5th Feb 2020 13:11
(Alliance News) - Nostra Terra Oil & Gas Co PLC on Wednesday said it will issue a single circular with a notice for a general meeting by this time next week after receiving two requisitions from shareholders Eridge Capital Ltd in recent weeks.
Nostra on Monday said it received a letter from Eridge on January 31 requisitioning a meeting for shareholders to consider removing Non-Executive Chair Ewen Ainsworth from the board.
The company had earlier in January received another requisition notice from Eridge, tabling a resolution to remove Chief Executive Officer Matt Lofgran.
Nostra explained: "The board of Nostra Terra believes it is in the best interests of the company and its shareholders as whole to consider the requisitions at a single general meeting rather than to incur the costs and expenses associated with publishing two separate circulars."
Nostra said that publishing just one circular to shareholders by February 5, in relation to the first requisition notice, would not have allowed time for the company to include the additional resolution in regards to Ainsworth's future.
The company added: "The board believes that publishing a single circular to shareholders by February 5 to consider the requisitions would not allow sufficient time for these additional items to be responded to by the board. The company recognises that this does not comply with the Companies Act 2006 and it will use all reasonable endeavours to publish the circular as soon as possible (in any event no later than 12 February)."
Also, Nostra said that a loan issued to its subsidiary New Horizons Energy 1 LLC from the Washington Federal Bank Inc included a key man clause. The covenant stipulated that Hofgren must remain as president of New Horizons.
Should he stop being New Horizons president, the subsidiary would risk being in default of the loan. Nostra is now seeking to have the key man clause removed from the loan agreement.
"In the event Lofgran is voted off the board at the company's forthcoming general meeting, there is no guarantee that Lofgran would remain as an employee of the Nostra Terra group, and therefore as president of New Horizons. Accordingly, the company's board at such time would seek the written consent of Washington Federal Bank to waive the key man clause, however there is a risk that this would not be given."
Nostra shares were 5.0% lower at 0.76 pence each in London on Wednesday afternoon.
By Eric Cunha; [email protected]
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