Each one in plain English, with the numbers worked through for a shareholder.
19 Jan 2005debt financing▲ GoodMajor
On January 12, 2005 Syntroleum Nigeria signed a Participation Agreement with Lundin Petroleum, Palace Exploration, Challenger Minerals, Providence Resources and Howard Energy, letting them earn 67.5% of Syntroleum's interest in the OML 113 joint venture; this follows the earlier YFP deal. Syntroleum's share of the initial well cost (estimated at about $20.9 million total) is capped at 10% under a turnkey contract, and on January 14, 2005 it posted the $10 million letter of credit to YFP, with the Participants agreeing to reimburse 90% of it. The Participants will pay a signature bonus once Nigerian approvals arrive and a development bonus after commercial production begins.
28 Oct 2004security holder rights change● NeutralMajor
On October 24, 2004 the company adopted a Second Amended and Restated Rights Agreement (a shareholder rights plan) with American Stock Transfer & Trust, running to October 24, 2014. The rights trigger if someone acquires 20% or more of the stock (35% for Robert Day and his family and affiliates), letting other holders buy shares at a discount. Separately, a consulting letter agreement with TI Capital Management (principal Ziad Ghandour, a director) was amended so he would be paid shares or cash equal to 1% of net proceeds of a financing with a Chinese company represented by Bear Stearns, at $5.79 per share, if it closes by February 1, 2006.
This amendment updates the Nigerian OML 113 deal: on October 7, 2004 Syntroleum and YFP signed a Joint Venture Agreement under the earlier Heads of Agreement. The filing sets new dates: an international operator by January 15, 2005 (or Syntroleum commits to drill alone), a letter of credit by January 15, 2005 (or the JV agreement terminates), and the first well to start by February 15, 2006, subject to extensions.
On August 27, 2004, Syntroleum's subsidiary signed a Heads of Agreement with Yinka Folawiyo Petroleum (YFP) to appraise and possibly develop the Aje Field discovery on Oil Mining Lease 113 offshore Nigeria. Syntroleum must drill an appraisal well, estimated at about $10 million, within 12 months of getting an interest in the lease, backed by a letter of credit that YFP could draw as liquidated damages if drilling does not start; it must also bring in an experienced international operator, and its final share depends on terms still to be negotiated.
