AMER.L Regulatory News (AMER)

24 Jun 2005 07:00

Chaco Resources PLC24 June 2005 CHACO RESOURCES PLC ("Chaco" or "the Company) Notice of Extraordinary General Meeting • EGM called for 18 July 2005 at 11 a.m. at Institute of Directors • Hydrocarbon exploration and production permits in Colombia applied for through Chaco's strategic partners. • If any are granted, the Company will need to raise funding at very short notice to secure them • Purpose of EGM is to seek shareholder approval to increase Board's authority to place shares for cash in order to have maximum flexibility on fundraising. Introduction On the 10th March this year, the Board announced that the Company was seeking toacquire hydrocarbon exploration and production contracts in Colombia tocomplement its ongoing activities in Paraguay. Further to that announcement, the Company has been introduced to a number ofopportunities and is currently applying for exploration and exploitation permitsin Colombia through its strategic partners. Due to the highly competitive environment and the fact that the Company is stillin discussions, it is not condidered prudent to give any further details at thistime. However, should any of these permits be granted, securing them wouldrequire the Company to raise funding at very short notice. The purpose of theExtraordinary General Meeting ("EGM") is to ask shareholders to grant the Boardthe necessary flexibility to ensure that this can be done. At Chaco's EGM last November, under Section 89 of the Companies Act, theCompany's shareholders granted the Board the discretionary right to place sharesfor cash up to an aggregate nominal amount of £41,725.83. This would beinsufficient for the purposes referred to above. The Board are asking theCompany's shareholders to increase this to £125,177.49. This authority will be reviewed at the AGM, currently planned for mid September. Current Share Capital At the date of this announcement the authorised share capital of the Company is£600,000 divided into 600,000,000 ordinary shares of 0.1p each ("OrdinaryShares"), of which 391,757,414 are issued, 13,830,000 Ordinary Shares arereserved for issue pursuant to outstanding options and a balance of 25,500,910Ordinary Shares ("the Consideration Shares") are reserved for issue pursuant tothe agreements to acquire Bohemia S.A. and Amerisur S.A., which were approved atthe EGM of the Company in November last year. Extraordinary General Meeting Yesterday, the Company sent to its shareholders a letter from the Chairman and aNotice convening an Extraordinary General Meeting to be held at 11.00am onMonday 18 July 2005 at the Institute of Directors, Room 402, 116 Pall Mall,London SW1Y 5ED at which the following resolutions will be proposed: Resolution 1 An Ordinary Resolution to increase the authorised share capital of the Companyfrom £600,000 to £700,000 by the creation of an additional 100,000,000 OrdinaryShares. Resolution 2 An Ordinary Resolution to grant the Directors authority for the purposes ofsection 80 of the Companies Act 1985 ("the Act") to allot relevant securities upto an aggregate nominal value of £166,903.32 (being 166,903,320 OrdinaryShares). The authority sought by this resolution will last for the period offive years after the date of the passing of the resolution. Resolution 3 A Special Resolution to grant the Directors authority to disapply section 89(1)of the Act in connection with a placing, a rights issue or other pre-emptiveissue, and any other issue of equity securities for cash up to an aggregatenominal value of £125,177.50 (being 125,177,500 Ordinary Shares), representing30 per cent of the enlarged issued share capital of the Company assuming theissue of all the Consideration Shares. The authority sought by this resolutionwill last until the conclusion of the next Annual General Meeting of the Companyin 2005 or, if sooner, 15 months after the passing of the resolution. Action to be Taken Shareholders will find enclosed with the Chairman's letter a notice of meetingand a Form of Proxy for the Extraordinary General Meeting. Whether or not theCompany's shareholders intend to be present at the meeting, they are requestedto complete, sign and return the Form of Proxy in accordance with theinstructions printed on it. The Form of Proxy should be returned to CapitaRegistrars, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU as soon aspossible and, in any event, so as to arrive not later than close of business onFriday, 15 July 2005. Recommendation, Voting Intentions and Notification The Directors consider the resolutions to be proposed at the ExtraordinaryGeneral Meeting to be in the best interests of the Company and of Shareholderstaken as a whole. The Directors have unanimously recommended allShareholders to vote in favour of the Resolutions to be proposed at the EGM.The Directors who hold ordinary shares in the Company have confirmed that theywill vote in favour of the resolutions to be proposed at the Extraordinary General Meeting of the Company. Accordingly, 4,750,000 Ordinary Shares (in aggregate)which, at the date of this document, represents approximately 1.21per cent ofthe issued share capital of the Company will be voted in favour of theresolutions. Additional copies of the Notice of Extraordinary General Meetingand Form of Proxy, as circulated by post to shareholders yesterday, will beavailable from Daniel Stewart & Company Plc, 48 Bishopsgate, London, EC2N 4AJ. The precise wording of the Notice follows: NOTICE OF EXTRAORDINARY GENERAL MEETING CHACO RESOURCES PLC ("the Company") (Registered in England and Wales under number 04030166) NOTICE IS HEREBY GIVEN that an Extraordinary General Meeting of the Company willbe held at 11.00 a.m. on Monday 18 July 2005 at the Institute of Directors, Room402, 116 Pall Mall, London SW1Y 5ED to consider and, if thought fit, pass thefollowing resolutions, of which resolutions 1 and 2 will be proposed as ordinaryresolutions and resolution 3 will be proposed as a special resolution: ORDINARY RESOLUTIONS 1 That the authorised share capital of the Company be increased from £600,000 to £700,000 by the creation of 100,000,000 new ordinary shares of 0.1p each ("Ordinary Shares") having attached thereto the rights set forth in the Articles of Association of the Company. 2 That the Directors be generally and unconditionally authorised in accordance with section 80 of the Companies Act 1985 (the "Act") to exercise all the powers of the Company to allot relevant securities (as defined in section 80(2) of the Act) provided that: 2.1 this authority shall be in substitution for any equivalent authority which may have been given to the Directors prior to the date of the passing of this resolution; 2.2 this authority shall be limited to the allotment of relevant securities up to an aggregate nominal value of £166,903.32 2.3 unless previously revoked, varied or extended, this authority shall expire five years after the date of the passing of this resolution except that the Company may at any time before such expiry make an offer or agreement which would or might require relevant securities to be allotted after such expiry and the Directors may allot relevant securities in pursuance of such an offer or agreement as if this authority had not expired; and 2.4 in relation to the grant of any right to subscribe for, or convert any security into, shares in the Company, the reference in this resolution to the maximum amount of relevant securities that may be allotted is to the maximum amount of shares which may be allotted pursuant to such right. SPECIAL RESOLUTION 3 That the Directors be empowered pursuant to section 95 of the Act and pursuant to the authority conferred by resolution 2 above to allot equity securities (as defined in section 94(2) of the Act) for cash as if section 89(1) of the Act did not apply to such allotment provided that: 3.1 this power shall be limited to: 3.1.1the allotment of new equity securities in connection with any rights issue or other offering of new equity securities in favour of the holders of equity securities in proportion to the respective numbers of such securities held by them (but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements and/or transfer and/or holding of any securities in uncertificated form or legal or practical problems under the laws of, or the requirements of any regulatory body or any stock exchange in, any territory); 3.1.2the allotment of new equity securities pursuant to the exercising of existing options over 13,830,000 ordinary shares of 0.1p each in the capital of the Company; and 3.1.3the allotment, otherwise than pursuant to paragraphs 3.1.1 and 3.1.2 above, of equity securities up to an aggregate nominal amount of £125,177.50; 3.2 unless previously revoked, varied or extended, this power shall expire on the earlier of the conclusion of the next Annual General Meeting of the Company and the date falling 15 months after the date of the passing of this resolution except that the Company may before the expiry of this power make an offer or agreement which would or might require equity securities to be allotted after such expiry and the Directors may allot equity securities in pursuance of such offer or agreement as if this power had not expired. Dated: 23 June 2005 BY ORDER OF THE BOARDRegistered Office:Prestige Travel Suite David ParsonsBarclays Bank House Secretary81-83 Victoria RoadSurbiton KT6 4NS Background Chaco Resources PLC is the successor company to Gold Mines of Sardinia PLC. In2004, the Company changed its strategy to one of pursuing hydrocarbonexploration and development opportunities in South America, focusing initiallyon Paraguay. Two local companies, Amerisur SA and Bohemia SA, were acquired forshares whereby Chaco obtained preliminary rights to approximately 4.7 millionhectares they together held under 3 applications. For various reasons, thecountry has seen comparatively little exploration activity to date, but it is ofinterest due to commercial extraction of hydrocarbons having been made inadjoining countries from hydrocarbon basins which extend into Paraguay. All thehistorical seismic data relative to the applications was purchased at the timeof the acquisitions. A small, highly professional, but extremely cost-effectiveoffice was opened in Asuncion. Two of the three applications are in their final stage - in Congress, awaitingto become Concession Law. The third application is still at the first stage andwill be progressed immediately thereafter. The seismic data, which dates backover a 30 year period and which is extensive, is due to be re-processed usingthe most modern methods. As there were concerns about the original data beingtransported to Europe, it is currently in Argentina being copied onto disk. The data has been examined, sorted and prioritised. Once it has been reprocessedand reinterpreted (this has an August target for completion, but key priorityinformation is expected sooner), the Company will move forward with itsstrategic options. Any drilling programmes are expected to be done with farm-inpartners. Colombia Subsequently, Chaco was introduced to opportunities in Colombia, where afundamental change in the fiscal laws and an overhaul of the state's managementof hydrocarbon exploration and exploitation permits created a very favourableinvestment environment. Chaco has teamed up with strategic partners who havemany years of experience operating in Colombia and through whom it has appliedfor exploration and exploitation permits. There has been a small investment toget to this stage, but the presence of the Asuncion office has allowed this tobe minimised. Further news concerning these applications is expected during July(For commercial reasons, no further information is being given at this stage). Enquiries : Martin Groak, Finance DirectorChaco Resources plctel : 07949 209 301 Ruari McGirr, Daniel Stewart & Company plctel : 020 7374 6789 The Directors of the Company accept responsibility for the information containedin this document. To the best of the knowledge and belief of the Directors (whohave taken all reasonable care to ensure that such is the case) the informationcontained in this document is in accordance with the facts and does not omitanything likely to affect the import of such information. This information is provided by RNS The company news service from the London Stock Exchange