Petroleum Africa
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Tuesday, September 29, 2015
VAALCO Energy’s board of directors authorized the adoption of a stockholder rights plan. VAALCO’s rights plan is designed to proactively assure that all of the company’s stockholders receive fair and equal treatment in the event of a proposed acquisition of the company, to guard against tactics to gain control of the company without paying all stockholders a premium for that control, and to enable all of its stockholders to realize the value of their investment. It is not intended to interfere with any takeover, merger, or other business combination approved by the board.
The adoption of the stockholders rights plan aims to protect the interests of all VAALCO stockholders. The board and management look forward to continuing to engage in constructive dialogue with stockholders regarding the company’s plans for its business and remain committed to strengthening performance and enhancing stockholder value.
Pursuant to the rights plan, the company will issue one preferred share purchase right for each outstanding share of its common stock to stockholders of record on the close of business on October 7. Initially, these rights will not be exercisable and will trade with the shares of the company’s common stock. Unless earlier redeemed or exchanged, the rights will expire at the close of business on September 25, 2016.
Under the rights plan, the rights will generally become exercisable only if a person or group acquires beneficial ownership of 10% or more of the outstanding common stock or announces a tender or exchange offer that would result in beneficial ownership of 10% or more of the company’s voting stock. In such situation, each holder of a right will be entitled to purchase one ten-thousandth (1/10,000) of a share of a series of junior preferred stock at an exercise price of $7.20 per right at a 50% discount, subject to anti-dilution adjustments.
VAALCO will be entitled to redeem the rights at $0.001 per right at any time prior to the acquisition of beneficial ownership of 10% or more of the company’s common stock by a person or group.
If a stockholder or group beneficially owns 10% or more of its outstanding common stock at the time of the announcement of the rights plan, that stockholder’s existing ownership percentage will be grandfathered, but the rights will become exercisable if at any time after the announcement of the rights plan such stockholder increases its ownership of its common stock by one share or more.
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