Member Info for AussieRidge

Thre recent agreement RNS states about the receipt of cash "55% on completion of the Proposed Transaction (from which the Company will meet transaction expenses and related costs". This is nearly £30 mil. Are our transaction expenses and related costs £30 mil or will there be funds left over?

Garry Dempster (VP Finance & Commercial)

There will likely be material funds left over but the Board has yet to make a decision on what to do with them.

Please provide a list of all of the current institutional shareholders on the sound company register.

Mohammed Seghiri (Interim CEO)

Our principle cornerstone investor is OGIF with approximately 23%. Other shareholder information is available through the normal AIM channels.

Could you please provide the current cash position and monthly overhead expenditure.

Garry Dempster (VP Finance & Commercial)

I'm afraid we can't provide this outside of what has already been announced on RNS

I remember that too BigBench

Is Sound Energy paying 100% of the agreement transaction expenses and associated costs or will this be shared?

Mohammed Seghiri (Interim CEO)

Shared (each side pays their own)

What has been the involvement of ONHYM and Schlumberger with this deal? This is an important question as the funding of the infrastructure has undergone a massive change from BOOT to direct funding.

Sound Energy (Administrator)

We cannot comment on third parties positions I’m afraid.

Provide the details of Rothschild’s activity in relation to this deal. What costs have been incurred so far and what cost will be due to Rothschild on successful completion of the Agreement.

Mohammed Seghiri (Interim CEO)

The terms of the Rothschilds engagement have not been disclosed by RNS and are confidential but we do believe we secured very competitive terms.

How many years has the “purchaser” been a register private company in the UK

Fred Lacuha (General Counsel)

The identity will be required to be announced once we sign a binding document. Until then we cannot guide I'm afraid.

If this deal is undertaken in its described format will Sound Energy Shareholders receive any direct dividends prior to first gas?

Mohammed Seghiri (Interim CEO)

The Board, if the deal transacts, would have to decide what to do with the US$54,3M upfront cash proceeds. No decision has been taken at this point (deal isn’t even complete yet!) but it will be in due course and communicated at that time. We would remind everyone that the cash flows from a 23.3% position in a P50 production scenario are significant

I am worried about the CEO, CFO and Chairman all leaving within a very short period of time. Would you agree that this can worry the markets into thinking that something is untoward?

Mohammed Seghiri (Interim CEO)

The CEO exit has been long planned and has been signalled to the market multiple times over the years. The Chairman was a totally unexpected health issue.

Have our institutional investors been approached or made comment on the reduction in market cap?

Sound Energy (Administrator)

We cannot comment on the current movement on the share price but so far our corner investor has always given a strong support to our activity in Morocco

Personally I think the deal is terrible, would it not been more beneficial to raise and drill the Paleozoic than sell half of the eastern Moroccan Licence for very little return for investors?

Mohammed Seghiri (Interim CEO)

Every shareholder will have a vote on the deal. It is not the Board’s intention to pre-empt the shareholder vote.

Or at least paste them in from prepared text. They'd have got through things a damn sight faster.

Passing operatorship to a private company puts shareholders in an extremely poor position – it limits the information that must be made available to stakeholders, it significantly curtails the corporate governance requirements vs our current state, and it gives Sound shareholders limited recourse in future, if the development of Tendrara does not go to plan. How do you assuage these concerns? Furthermore, what weighting was given to the provenance of the offeror when assessing the offers you received? Can you confirm once and for all that there is absolutely no link, however tenuous, between the proposed JV partner/purchaser and any existing or former employee of Sound Energy PLC or any of their associates.

Fred Lacuha (General Counsel)

There is no link between the proposed purchaser and any existing or former employee or any associates of any of them obviously as far as the Company is aware

How much of the upfront cash component of the agreement (55% of $54.3m – approx. £23.23m) does the company envisage retaining after the payment of fees and expenses related to the deal? Will the remaining funds be earmarked for repayment of the outstanding debts, as was previously outlined by management? Given that the outstanding debt is currently larger than the proposed upfront cash component of the agreement, will the company need to raised capital in order to remain a going concern, and to participate in any exploration program that were to occur prior to FID and First Gas?

Mohammed Seghiri (Interim CEO)

Good question. If transaction is done, we will revert back to you on due course on this matter. The Board will study different possible scenarios (including distribution of a part of the cash proceeds to the shareholders).

Is it the intention of the management to pay off outstanding debt immediately if the "agreement" goes through or will the debt be it going until 2021?

Garry Dempster (VP Finance & Commercial)

If the transaction is done, we will revert back to you on due course on this matter. The Board will study different possible scenarios (including distribution of a part of the cash proceeds of the shareholders).

What is the current cash position at Sound Energy? It is important to know with the CEO going. It was £11.3 million at end of June, has it changed substantially?

Garry Dempster (VP Finance & Commercial)

We can only report what was in the last RNS which was for the interims and this was £11.1 million.

What happens to Brian and the geology team of the "agreement" goes through? Will they join the JV partner or stay with Sound Energy?

Mohammed Seghiri (Interim CEO)

The staffing plans are in progress but no firm decisions have yet been made with regards to the transfer or dedication of Sound Energy employees to the JV partner. The company continues, as it has always done, to right size our resources whilst we retain the appropriate skillset and continuity to deliver our operations both efficiently and safely.

If the "agreement " gets voted through and the company decides to relinquish Sidi Moktar will Sound Energy be in danger of becoming a cash shell and suffering removal from AIM? Would its share of the JV be enough of an asset to keep the company on AIM?

Mohammed Seghiri (Interim CEO)

Yes share of the asset will still make it eligible for AIM

The share price of 3-4p reflects what investors think about the agreement. What value does the Sound Energy management think the "agreement" should be or are investors correct?

Mohammed Seghiri (Interim CEO)

Not up to the management to comment on what the market values the deal at but independent sources value it at 19 p (17p less debt)