underwriting agreement amendment

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24 October 2008
AMENDMENT TO UNDERWRITING AGREEMENT
Cougar Energy Limited (ASX Code: CXY) wishes to advise the market that its Notice of Annual General
Meeting (the “Notice”) will be mailed to all shareholders later today. A copy of this Notice has today been
announced separately to the market. The agenda of the meeting does not contain any resolutions in relation
to the issue of ordinary shares pursuant to the underwriting agreement entered into between CXY and Direct
Invest Pte Ltd (“DI”).
As previously announced to the market on 10 September 2008, CXY has entered into an underwriting
agreement with DI for it to underwrite CXY’s December 2008 listed options (ASX Code: CXYO). Pursuant
to the terms of that underwriting agreement, DI will subscribe for the same number of ordinary shares (CXY)
in Cougar as the number of CXYO options not exercised prior to 5:00 pm on Wednesday 31 December 2008
(the “Shortfall Securities”).
As the potential number of ordinary shares that could be issued to DI under the underwriting agreement may
exceed 15%, CXY originally intended to seek shareholder approval for the issue of these shares pursuant to
listing rule 7.1 and for an exemption to the takeover provisions of the Corporations Act 2001, in the event
that DI ended up with in excess of 20% of the issued ordinary shares of CXY. However, listing rule 7.3.2
states that, “For the holders of ordinary securities to approve an issue or agreement to issue, the notice of
meeting must include... the date by which the entity will issue the securities. The date must be no later than 3
months after the date of the meeting...”.
As the underwriting agreement provides for DI to subscribe for all the shortfall securities on a progressive
basis up until Tuesday 31 March 2009, this would mean that CXY would not have complied with listing rule
7.3.2, because with the Company’s Annual General Meeting scheduled for Thursday 27 November 2008,
CXY must issue any shares approved by members pursuant to the Notice by Thursday 26 February 2009.
On Wednesday 1 October 2008, the Company applied to the ASX for a waiver to listing rule 7.3.2.
Unfortunately the ASX declined the Company’s request. As a result, CXY has had to modify its Notice by
removing from the agenda of its upcoming Annual General Meeting any voting by members on the issue of
the shortfall securities to DI pursuant to the terms of the underwriting agreement. CXY is in the process of
discussing an amendment to the underwriting agreement with DI and will make a further announcement to
the market, once negotiations have been finalised.