*STATEMENT BY MEMBERS REQUISITIONING GENERAL MEETING OF BOWEN ENERGY LIMITED (ABN 71 120 965 095) (THE "COMPANY") TO THE SHAREHOLDERS OF THE COMPANY*
Dear Fellow Shareholders,
We consider the Company has recently been underperforming. We believe that a new Board will reinvigorate the Company, creating new value and strength to your share price.
By voting YES TO RESOLUTIONS 1 TO 8 INCLUSIVE you will be voting to replace all but one of the members of the Board as at 22 April 2009, the date our meeting requisition was given to the Company. The other Board member on that date, Mr Bill Hayes, resigned on 1 May 2009. Accordingly, the Board will be reduced from the current seven members to three persons that is, Kevin Nichol, John Yin, and the third person will be appointed director by Kevin and John to fill the casual vacancy created by Bill Hayes' resignation. All three members of the new Board will be Australian residents, enabling simple but effective management of the Company. Presently, four of the members of the Board are linked to Bhushan Steel (Australia) Pty Ltd ("*Bhushan*"). Three of those four directors were appointed after entry into a subscription agreement dated 11 September 2008 ("*Subscription Agreement*") which gave Bhushan the right to appoint a Board majority from the date of subscription for shares by Bhushan. However, the Subscription Agreement was terminated without the proposed subscription of shares being undertaken, but the directors appointed in contemplation of that subscription remain, giving Bhushan current control of the Board. We consider it inappropriate for the Board to be constituted in this way.
The new Board members will be Kevin Nichol and John Yin and (filling the casual vacancy created by Bill Hayes' resignation), a third director. Kevin Nichol (B Comm (Hons), CFA ) was the founding Managing Director of the Company. He has worked for the late Kerry Packer's private company, Consolidated Press Holdings Pty Ltd as a financial analyst. He has also been a manager of a trading floor team for one of the largest banks in the world. In the last 25 years he has gained a wide experience in the equities market with substantial capital raising experience particularly in the resource sector. He brings to the Board many years of market knowledge and his previous experience with the Company is invaluable.
John Yin is a company director with 10 years experience in setting up and successfully operating an IT company based in Sydney. He acts as a business consultant for listed and private companies. He is actively involved in investing in mining and resources companies and has extensive knowledge of capital raising, having been involved in raising millions of dollars for ASX listed companies and is experienced in and committed to maximising shareholder value.
If the vote on all those resolutions is successful, the new Board proposes the following changes for the Company:
1. The new Board proposes to replace current listed options that expire on 27 November 2009 (the "*2009 Options*") with new, listed options with the exercise price reduced from the current 20 cents to 10 cents per option. The expiry date for this new class of option ("*2012 Options*") will be 27 November 2012. Shareholders will pay $0.001 (one tenth of a cent) for each new option which will replace their existing 2009 Options. Option holders who elect not to take-up the 2012 Options will of course retain their options in the current option series. The issue of the 2012 Options requires shareholder approval, which is the reason why the meeting requisitioners have proposed resolution 9.
2. In order to establish JORC compliant resource as soon as possible, the new Board intends to core 3 holes on each of the recently drilled Coking and PCI coal tenements. This will enable a "JORC" compliant resource to be established quickly and at a cost estimated to be approximately $300,000.
3. The new Board will as a matter of urgency revisit the current funding of the Company. The Subscription Agreement with Bhushan referred to above related to a placement to Bhushan of 100 million shares at 32 cents to raise $32 million that would have gone into your company as cash. The Subscription Agreement provided for a first instalment of equity funds from Bhushan in an amount of $16 million on passing of a resolution of shareholders. In November 2008 the Subscription Agreement was amended so that that first instalment of $16 million was broken up into four instalments of $4 million each with only the first instalment being payable on shareholder approval of the Subscription Agreement, and with the Company also taking an informal loan from Bhushan for working capital. At the end of March this year the current Board agreed with Bhushan to terminate the Subscription Agreement. Absent Bhushan's equity funding commitment under the terminated Subscription Agreement the proposed new Board intends to recapitalise the Company by offering up to $5,000.00 worth of new shares to every shareholder (with a minimum parcel valued at $500.00 worth of shares) at the best price possible under the ASX Listing Rules. A placement to sophisticated investors can accompany the share purchase plan if further funding is required.
4. The proposed new Board is determined to put this company back in shareholder's hands.
VOTE YES TO ALL RESOLUTIONS TO MAKE THIS POSSIBLE
ALL SHAREHOLDERS, LARGE AND SMALL ARE CALLED ON TO MAKE THIS A REALITY.
Those of you who have 2,000 or 5,000 shares, the smaller shareholders, do count. The shareholders proposing these resolutions need smaller and larger shareholders to stand shoulder to shoulder in order to have a chance of changing the current status quo.
This Statement is issued by the proactive shareholders who signed the section 249D notice requesting this general meeting.
BWN Price at posting:
10.0¢ Sentiment: Buy Disclosure: Held
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