Frontera Resources Corporation Notice of General Meeting (7963A)

TIDMFRR

RNS Number : 7963A

Frontera Resources Corporation

10 June 2016

Houston, Texas, U.S.A. - 10 June 2016

FRONTERA RESOURCES CORPORATION

("Frontera" or the "Company")

Notice of General Meeting

Frontera Resources Corporation (AIM: FRR), an independent oil and gas exploration and production company, today announces that it will hold a general meeting of shareholders ("General Meeting") on 28 June 2016, at 9:00 a.m. CST (3:00 p.m. BST), at 3040 Post Oak Blvd, Room 109, Houston TX, 77056. Circular containing the formal notice of the General Meeting and the agenda is being sent to shareholders today and a copy is available on the Company's website at www.fronteraresources.com.

Enquiries:

Frontera Resources Corporation

Jesse Jefferies

[phone]

[e-mail]

Buchanan Communications

Ben Romney/Hannah Brandstaetter

[phone]

[e-mail]

Nominated Adviser

Cairn Financial Advisers LLP

61 Cheapside, London EC2V 6AX

Jo Turner/ Liam Murray

[phone]

Broker

Cornhill Capital Limited

Nick Bealer

[phone]

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents of this document or the action you should take, you should immediately consult your stockbroker, bank manager, solicitor, accountant or other independent professional adviser duly authorised pursuant to the Financial Services and Markets Act 2000 (as amended) (or, if you are outside the United Kingdom, a person otherwise duly qualified in your jurisdiction) who specialises in advising in connection with shares and other securities.

If you sell or have sold or otherwise transferred all of your ordinary shares in Frontera Resources Corporation (Company), please immediately forward this document to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the sale or transfer was effected, for onward transmission to the purchaser or transferee. If you sell or have sold or otherwise transferred only part of your holding of ordinary shares, you should retain these documents.

FRONTERA RESOURCES CORPORATION

(Incorporated and registered in the Cayman Islands with company number 256380)

Strategic Transactions to Advance the Company's Work Programs,

Increase of Authorised Share Capital,

Notice of General Meeting to be held on 28 June 2016

This is an important shareholder notice and your immediate attention is required

Notice convening a General Meeting of the Company to be held at 9:00 a.m. CST (3:00 p.m. BST) on 28 June 2016 at 3040 Post Oak Blvd, Room 109, Houston TX, 77056, is set out at the end of this document. Holders of ordinary shares in the Company from time to time (Shareholders) will also find enclosed with this document a Form of Proxy.

The action to be taken by Shareholders is set out on page 5. To be valid, the Form of Proxy must be completed, signed and returned in accordance with the instructions printed thereon so as to be received by the Company's registrars, Computershare Investor Services (Cayman) Ltd, for and on behalf of the Company Secretary, as soon as possible but in any event not later than 9:00 a.m. CST (3:00 p.m. BST) on 24 June 2016. The completion and return of a Form of Proxy will not preclude Shareholders from attending and voting in person at the General Meeting should they subsequently wish to do so.

LETTER FROM THE CHAIRMAN OF THE BOARD OF DIRECTORS AND CHIEF EXECUTIVE OFFICER OF

FRONTERA RESOURCES CORPORATION

(Incorporated and registered in the Cayman Islands with company number 256380)

 
                                  Headquarters and Registered 
                                                     offices: 
 
 Steve Nicandros (Chairman 
  and CEO) 
  Zaza Mamulaishvili (Executive 
  Director, President and 
  CFO) 
 Andrew Szescila (Non-Executive 
  Director) 
 Luis Giusti (Non-Executive 
  Director) 
 
                                           Frontera Resources 
                                                  Corporation 
                                          3040 Post Oak Blvd, 
                                                   Suite 1100 
                                         Houston, Texas 77056 
                                                          USA 
 
                                    Maples Corporate Services 
                                                      Limited 
                                                 P.O. Box 309 
                                                 Ugland House 
                                        Grand Cayman KY1-1104 
                                               Cayman Islands 
 

10 June 2016

Dear Shareholder

Strategic Transactions to Advance the Company's Work Programs,

Increase of Authorised Share Capital,

Notice of General Meeting to be held on 28 June 2016

Introduction

I am writing to inform you that a general meeting of the Company (General Meeting) will be held at 9:00 a.m. CST (3:00 p.m. BST) on 28 June 2016 at 3040 Post Oak Blvd, Room 109, Houston, TX 77056. The formal notice of the General Meeting and the resolutions (Resolutions) to be proposed are set out at the end of this document. The Directors believe that the passing of the Resolutions is important to the successful outcome of the Company's operations going forward and therefore urge Shareholders to complete and return their Forms of Proxy/Instruction and vote in favor of the Resolutions whether or not they intend to attend the General Meeting in person. The Directors intend to vote in favor of the proposed Resolutions in respect of their own shares.

To date, the Company has advanced strategic technical success from its exploration initiatives and established the existence of materially significant oil and gas resources throughout its portfolio, as well as critically unique technical applications for potentially achieving associated commercial development/production operations. Because of this progression, which has been achieved as a result of investment of approximately US$400 million, the Company is pleased to announce a series of initiatives aimed at providing necessary financial resources for undertaking the next phase of technical and commercial work in order to potentially achieve a step-change in results, thereby increasing shareholder value through growth of its on-going operations in Georgia, as described in detail below (Transactions).

This document explains the background to and reasons for the Transactions and why the Board considers the Transactions to be in the best interests of the Company and its Shareholders, and recommends that you vote in favour of the Resolutions to be proposed at the General Meeting.

Background to and reasons for the Transactions

The Company continues to significantly advance technical study, workover, drilling, and stimulation completion programs associated with its ongoing Oil Window and Gas Window operations at its South Kakheti Gas Complex and Shallow Fields Production Unit within its Block 12 portfolio in the country of Georgia. The proposed Transactions will enable implementation of accelerated and more technically advanced operations over the remainder of this year and next year, in order to increase revenue from exploration related pilot-production programs for oil and gas in 2016 and 2017, and potentially establish the basis for initiating full-scale commercial development from both areas. Overall, the planned operations are anticipated to achieve a transformational step forward of value creation for the Company.

Specifically, the Transactions will enable the company to undertake the following exploration work programs (Work Programs):

- 2016 - Stimulation equipment purchase; 15 existing well stimulation program; 6 new well drilling program

   -               2017 - 15 existing well stimulation program, 6 new well drilling program, continued infrastructure expansion associated with increased production volumes 

It is anticipated that the planned exploration Work Programs will enable the Company to:

- Expand its current inventory of stimulation pumping and drilling/workover-rig equipment in order to be able to cost-efficiently implement technically advanced stimulation-completions in its planned exploration work programs

- Build on historical technical advancements and attempt to achieve enhanced production results from the next evolution of larger stimulation designs

- Potentially achieve year-end 2016 pilot-production rates of as much as approximately 2,200 boe per day and year-end 2017 production rates of as much as approximately 4,500 boe per day. Assuming $50/bbl oil price and $7/Mcf gas price, this will potentially result in increased 2016 annual revenue of as much as US$11 million, and 2017 annual revenue of as much as US$70 million.

Details of the Transactions

In order to undertake the Work Programs described above, the Company recommends completion of the following strategic Transactions pending passing of the Resolutions to be proposed at the General Meeting as described in detail below:

(1) The Company has conditionally completed service agreements with two strategic service providers in Georgia (Service Providers) whereby the Company will procure an aggregate US$4,000,000 worth of oil field services in support of its planned 2016 and 2017 Work Programs from the Service Providers in exchange for the issuance of new Ordinary Shares in the Company issued to the Service Providers. The number of shares to be issued will be determined based on an average of the daily volume weighted average prices of the shares traded during the 15 consecutive trading days beginning on 28 June 2016. To date, the Service Providers have increasingly become strategic alliance members of the Company's on-going operations. In this context, the Service Providers provide key oil field services that permit the Company to advance its work in the most cost efficient manner possible in contrast to mobilizing similar services from outside of Georgia and/or building associated in-house capabilities. The Service Providers will provide: i) supporting equipment and labor, including up to four drilling and workover rigs; ii) transportation services for handling/moving produced oil and associated liquids within field processing operations; iii) maintenance services for oil and gas transportation infrastructure and access roads; and iv) maintenance services and operational support of Company owned oil field equipment.

(2) The Company has entered into financing agreements with YA II PN, Ltd., formerly known as YA Global Master SPV Ltd. (Yorkville), dated 28 June 2011, 27 January 2012 and 31 December 2013 (as amended from time to time), that provide for a standby equity distribution agreement and related convertible debt financing for up to approximately US$31 million (GBP21 million) of available equity/debt investment. The Company will work with Yorkville to make approximately US$14 million available over the next six months. The Company will use these funds to:

(i) purchase approximately US$4 million of additional oil field equipment to expand the Company's current fleet in order to undertake larger well-stimulation completions in the planned Work Programs. This will include acquisition of frac/pumping units; a frac blender and other associated equipment, and; a workover/drilling rig.

(ii) provide approximately US$10 million of working capital in support of the Work Programs as well as costs associated with this transaction.

Increase of Authorized Share Capital In Order To Undertake the Transactions

The Company does not currently have sufficient authorised share capital to undertake the proposed strategic Transactions. Currently, the Company's authorized share capital comprises US$174,000 divided into 4,350,000,000 ordinary shares of a nominal or par value of US$0.00004 each (Ordinary Shares), and the Company's issued share capital comprises 4,076,363,695 Ordinary Shares. Accordingly, the Transactions are conditional upon the passing of the Resolutions to be proposed at the General Meeting.

In order to fully complete the Transactions, provide additional headroom to allot shares going forward, and maintain sufficient reserve of shares in respect of outstanding convertible securities of the Company, the Company is proposing, and the Shareholders are being requested, to approve an increase of the Company's authorised share capital from US$174,000 divided into 4,350,000,000 Ordinary Shares of a nominal or par value of US$0.00004, to US$354,000 divided into 8,850,000,000 Ordinary Shares of a nominal or par value of US$0.00004. The increase of the authorised share capital will require amendment of the Company's Memorandum of Association and its constitutional documents.

General Meeting

Attached at the end of this document is a formal notice convening the General Meeting, to be held at 9:00 a.m. CST (3:00 p.m. BST) on 28 June 2016 at 3040 Post Oak Blvd, Room 109, Houston, TX 77056, with the following agenda, to consider, and if thought fit, pass the following Resolutions:

ORDINARY BUSINESS

Update regarding status of on-going operations, description of the proposed strategic transactions, question and answer session

SPECIAL BUSINESS

Increase of authorised share capital (Resolution 1 - Ordinary Resolution)

Conditional upon the passing of Resolution 2, that the authorised share capital of the Company be increased from US$174,000 divided into 4,350,000,000 shares of a nominal or par value of US$0.00004 each, to US$354,000 divided into 8,850,000,000 shares of a nominal or par value of US$0.00004 each.

Amendment to articles (Resolution 2 - Special Resolution)

To amend the Company's Memorandum of Association to reflect the increase in authorised share capital.

Action to be taken

Shareholders will find enclosed with this document a Form of Proxy for use in connection with the General Meeting. Whether or not you propose to attend the General Meeting in person, you are requested to complete, sign and return the Form of Proxy in accordance with the instructions printed thereon. To be valid, completed Forms of Proxy must be received by the Company's registrars, Computershare Investor Services (Cayman) Ltd, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, for and on behalf of the Company Secretary, as soon as possible but in any event not later than 9:00 a.m. CST (3:00 p.m. BST) on 24 June 2016 (or 48 hours prior to any adjourned meeting).

If you complete and return a Form of Proxy, you may still attend and vote at the General Meeting in person should you subsequently decide to do so.

Please read the notes to the notice of General Meeting and the accompanying Form of Proxy for detailed instructions. The attention of Shareholders is also drawn to the voting intentions of the Board set out below.

Questions and Answers

In order to give shareholders the opportunity to obtain answers to questions they may have with respect to the proposed Transactions and Resolutions, the Company invites shareholders to submit questions by email to [e-mail] by 12pm CST/6pm BST on 15 June 2016. Questions will be addressed in a Q&A that will be uploaded to the secure section of the Company's website at: http://www.fronteraresources.com by 6pm CST/12am BST on 22 June 2016. Shareholders will be provided with instructions and password to access the secure site in the Form of Proxy and Form of Instruction posted to them.

Recommendation

The Board considers that the Resolutions to be put to the General Meeting are in the best interests of the Company and its Shareholders as a whole and unanimously recommends Shareholders to vote in favor of the Resolutions. The Board believes that the passing of the Resolutions is important to the successful outcome of the Company's operations going forward and therefore urges all Shareholders to complete and return their Forms of Proxy/Instruction and vote in favour of the Resolutions irrespective of whether or not they intend to attend the General Meeting in person. The Board members intend to vote in favor of the proposed Resolutions in respect of their own shares.

Yours faithfully

Steve C. Nicandros

Chairman of the Board of Directors

and Chief Executive Officer

FRONTERA RESOURCES CORPORATION

(Company)

(Incorporated and registered in the Cayman Islands with company number 256380)

NOTICE OF GENERAL MEETING

NOTICE IS HEREBY GIVEN that the General Meeting of the Company (Meeting) will be held at 3040 Post Oak Blvd, Room 109, Houston, TX 77056 at 9:00 a.m. CST (3:00 p.m. BST) on 28 June 2016 for the transaction of the following business:

ORDINARY BUSINESS

Update regarding status of on-going operations, description of the proposed strategic transactions, question and answer session

SPECIAL BUSINESS

1. By way of ordinary resolution (and conditional upon the passing of resolution 2 below) the authorised share capital of the Company be and is hereby increased from US$174,000 divided into 4,350,000,000 shares of a nominal or par value of US$0.00004 each, to US$354,000 divided into 8,850,000,000 shares of a nominal or par value of US$0.00004 each.

2. By way of special resolution, the Memorandum of Association of the Company be and is hereby amended such that words:

"The authorised share capital of the Company is US$174,000 divided into 4,350,000,000 shares of a nominal or par value of US$0.00004 each"

be deleted in their entirety and replaced with:

"The authorised share capital of the Company is US$354,000 divided into 8,850,000,000 shares of a nominal or par value of US$0.00004 each"

By Order of the Board

Levan Bakhutashvili

Vice President, General Counsel and Corporate Secretary

DATE: 10 June 2016

Headquarters and Registered offices:

Frontera Resources Corporation

3040 Post Oak Blvd, Suite 1100

Houston, Texas 77056 USA

Maples Corporate Services Limited

P.O. Box 309

Ugland House

Grand Cayman KY1-1104

Cayman Islands

Notes to the Notice of General Meeting:

1. The Company has specified that only those members entered on the register of members at close of business on 24 June 2016 (or in the event that this meeting is adjourned, on the register of members 48 hours before the time of any adjourned meeting) shall be entitled to attend, speak and vote at the Meeting in respect of the number of ordinary shares in the capital of the Company held in their name at that time. Changes to the register after close of business on 24 June 2016 shall be disregarded in determining the rights of any person to attend, speak and vote at the Meeting.

Appointment of proxies

2. Members are entitled to appoint a proxy or proxies to exercise all or any of their rights to attend and vote at the Meeting. A proxy need not be a Shareholder. A Shareholder holding two or more shares may appoint more than one proxy in relation to the Meeting. Please contact the Registrar if you wish to appoint multiple proxies.

3. A Form of Proxy is enclosed for use by Shareholders holding shares in certificated form. The completion and return of a Form of Proxy whether in hard copy form or in CREST will not preclude a member from attending in person at the meeting and voting should he or she wish to do so. Holders of Depositary Interests in CREST who wish to attend the meeting and/or vote at the meeting must notify the Depositary in writing.

4. To be valid, the Form of Proxy and the power of attorney or other authority (if any) under which it is signed or a certified copy of such power or authority must be lodged at the offices of the Company's registrars, Computershare Investor Services (Cayman) Ltd, c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, for and on behalf of the Company Secretary, by hand, or sent by post, so as to be received not less than 48 hours before the time fixed for the holding of the meeting or any adjournment thereof (as the case may be), weekends and bank holidays excluded.

CREST Voting Instructions for Depository Interest Holders

5. Holders of Depository Interests in CREST may transmit voting instructions by either completing and returning the Form of Instruction to the office of the Depository, The Pavilions, Bridgwater Road, Bristol BS99 6ZY, by hand, or sent by post, so as to be received not less than 72 business hours before the time fixed for the holding of the meeting, or utilising the CREST voting service in accordance with the procedures described in the CREST Manual. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider, should refer to their CREST sponsor or voting service provider, who will be able to take appropriate action on their behalf. In order for instructions made using the CREST voting service to be valid, the appropriate CREST message (a "CREST Voting Instruction") must be properly authenticated in accordance with Euroclear's specifications and must contain the information required for such instructions, as described in the CREST Manual (available via www.euroclear.com/CREST).

6. To be effective, the CREST Voting Instruction must be transmitted so as to be received by the Company's agent (3RA50) no later than 9:00 a.m. CST (3:00 p.m. BST) on 23 June 2016. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the CREST Voting Instruction by the CREST applications host) from which the Company's agent is able to retrieve the CREST Voting Instruction by enquiry to CREST in the manner prescribed by CREST. Holders of Depository Interests in CREST and, where applicable, their CREST sponsors or voting service providers should note that Euroclear does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply in relation to the transmission of CREST Voting Instructions. It is the responsibility of the Depository Interest holder concerned to take (or, if the Depository Interest holder is a CREST personal member or sponsored member or has appointed a voting service provider, to procure that the CREST sponsor or voting service provider takes) such action as shall be necessary to ensure that a CREST Voting Instruction is transmitted by means of the CREST voting service by any particular time. In this connection, Depository Interest holders and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.

Issued shares and total voting rights

7. As at close of business on 8 June 2016 (being the latest practicable date prior to the publication of this Notice), the Company's issued share capital comprised 4,076,363,695 Ordinary Shares with a nominal par value of $0.00004 each fully paid. On a poll, each Ordinary Share carries the right to one vote at a general meeting of the Company and, therefore, the total number of voting rights in the Company as at close of business on 8 June 2016 are 4,076,363,695.

This information is provided by RNS

The company news service from the London Stock Exchange

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June 10, 2016 02:00 ET (06:00 GMT)