Cap Energy Ltd
LSE : CAPP

November 08, 2013 02:00 ET

Reduction of Share Capital and Re-registration as a Public Limited Company

                                                                                                            
                                                                                             8 November 2013
                                                                                                GB00BCHWWB79
                                                      
                                             CAP ENERGY LIMITED
                                          ("Cap" or the "Company")
                                                      
                 Reduction of Share Capital and Re-registration as a Public Limited Company
                                                      
Set  out below is the text of a letter which is being posted to shareholders in the Company today.  Copies  of
the full circular will be available via the Company's website www.capenergy.co.uk  and at www.isdx.com.

"Dear Shareholder,

Reduction of Share Capital and Re-registration as a Public Limited Company
Cancellation of Deferred Shares

The  purpose of this letter is to provide you with a brief summary and explanation of the resolutions proposed
by  Cap  Energy  Limited  ("Cap" or the "Company") as set out in the attached notices convening  two  separate
General  Meetings ("GMs") of the Company ("Notices of GM").  It is proposed that the first General Meeting  be
held  at  10.00am  on  27 November 2013 (the "Reduction Meeting") and the second General Meeting  be  held  at
10.00am on 12 December 2013 (the "Re-Registration Meeting").

As  the  Company continues to grow, it will be restricted from raising finance publically due to  its  current
status  as a private limited company and therefore the Board has resolved that the Company take steps  to  re-
register itself as a public limited company.

In order to re-register as a public limited company, it is a key requirement that the Company has positive net
assets based on the tests set out in the Companies Act 2006.   In order to meet these tests, the Company  must
first  carry  out a reduction of the amount standing to the credit of the Company's share premium  account  to
create  a  positive  reserve (which is treated as realised profit), which can then be  used  to  set  off  the
Company's  historic  accumulated losses.   The Company's share premium account  is  now  sufficient  for  this
purpose  following  the issue of the new ordinary shares of 5 pence each on the conversion  of  existing  loan
notes  of  the  Company and the additional subscriptions for new ordinary shares which  were  announced  on  3
October 2013.

Both  this reduction of share capital and the re-registration as a public limited company require the approval
of shareholders.

In addition, in order to clean up the Company's share capital, the Board are also proposing that the Company's
7,917,649  deferred  shares  in  issue  ("Deferred Shares"),  which  were  created  pursuant  to  the  capital
reorganisation of the Company in 2012 and which have minimal value,  be cancelled pursuant to the terms of the
Company's articles of association (the "Articles").

The Company would like to propose the following Special Resolutions at the Reduction Meeting:

Resolution 1

Resolution  1  proposes to reduce the amount standing to the credit of the Company's share  premium  account
from  £3.43  million to zero, with the amount so reduced being credited to a reserve.    This  reduction  is
intended  to enable the Company to meet the positive net assets test set out in the Companies Act  2006  for
the purpose of re-registering as a public limited company.

Resolution 2

In  order  to  effect the proposed reduction of capital and cancellation of the Deferred Shares without  the
need  to obtain the sanction of the court (as is permitted by the Companies Act 2006), Resolution 2 proposes
a  minor  change to the Articles to remove the reference to the court process being involved  in  the  share
capital reduction required prior to cancellation.

Resolution 3

Resolution 3 authorises the reduction of capital on, and cancellation of, the Deferred Shares.

Subject  to the passing of the Special Resolutions at the Reduction Meeting, the Company would also like  to
propose the following Special Resolutions at the Re-Registration Meeting:

Resolution 1

Resolution 1 proposes that the Company be re-registered as a public limited company.

Resolution 2

Resolution  2 amends the Articles to reflect the Company's new name on re-registration, remove reference  to
the  Deferred Shares, and make a few other consequential amendments in keeping with the Company's new status
as a public limited company.

Share certificates will remain valid following the re-registration and change of name.

Timetable

The  expected  timetable of events if the Special Resolutions are passed by shareholders at the  GMs  is  as
follows:

    *       Expected date for the reduction of share premium and cancellation of deferred shares - 27 November
            2013.
    *       Expected date for the re-registration as a public limited company - 12 December 2013.

Shareholder Voting

All  Shareholders  registered as holding ordinary shares of the Company at 6pm on 25 November  2013  or,  if
adjourned,  6pm on the day that is the second day prior to the date of the adjourned meeting (not  including
any  day that is not a business day) shall be entitled to attend the GMs and vote on the Special Resolutions
proposed.

Action to be taken by Shareholders

Attached  to  the  Notices of GM accompanying this letter are two Proxy Forms for use by Shareholders.   All
Shareholders  are invited and encouraged to attend the GMs or, if they are unable to attend  in  person,  to
complete,  sign and return the Proxy Forms to the Company.  Lodgement of a Proxy Form will not preclude  the
Shareholder from attending and voting at the GMs in person.

Shareholders can either deliver the Proxies by hand, by mail, by facsimile or as an attachment by email.

Recommendation

The  Board  believes that the Special Resolutions are fair and reasonable and in the best interests  of  the
Company and Shareholders alike, and therefore recommends you to vote in favour of them as the directors have
undertaken  to  do  in respect of the 2.3 million ordinary shares held by them, representing  8.24%  of  the
Company's issued share capital.  In addition, Global Energy Trade Limited (which is owned and controlled  by
Lina Haidar and Alexander Haly, both directors and shareholders of the Company) holds 23.17 million ordinary
shares,  representing 82.74% of the Company's issued share capital as at the date hereof has also undertaken
to vote in favour of all of the Special Resolutions.

Yours sincerely,


Timothy Hearley
Chairman"


The Directors of Cap Energy Limited are responsible for the contents of this announcement.

For further information please contact:

Tim Hearley, Chairman
Tel: +44 (0) 7850 390998
Email: tim.hearley@capenergyplc.com

Lina Haidar, Chief Executive Officer
Tel: +44 (0) 20 7491 9196
Email: lina.haidar@capenergyplc.com

Corporate Adviser:
Mark Anwyl and Duncan Vasey
Peterhouse Corporate Finance Limited
Tel: +44 (0) 20 7469 0930
Email: duncan@pcorpfin.com

Cap Energy Limited
25 Dover Street
London W1S 4LX
Tel: +44 (0) 20 7491 9196
Email: info@capenergyplc.com




Contact Information

  • Cap Energy Ltd