Shareholder FAQs
General Meeting 26 July 2021
1. What is the purpose of resolution 1 – what is the difference between allotting the shares and issuing them i.e. why is resolution 1 needed – why not just the authority to issue?
Allotment creates an unconditional right for a person to be registered as a shareholder of a company. The shares are issued after the name of the person to whom those shares have been allotted are entered into the shareholder register. That person is then able to exercise his or her rights as a shareholder. Resolution 1 is an ordinary resolution and has a 50% approval threshold.
2. Could you kindly explain the purposes of resolutions 3 & 4 particularly #3?
The Companies Act 2006 gives shareholders a pre-emption right, pro-rata to their existing shareholdings over any proposed share allotments. The purpose of Resolutions 3 and 4 is to allow the Company to allot and issue the share amounts stated in Resolutions 1 and 2 respectively on a non-pre-emptive basis. This is done when the Company believes the issuance of the shares on a non-pre-emptive basis is in the best interests of the company and its shareholders. Factors taken into consideration when deciding on a non-pre-emptive equity issuance versus an alternative rights issue included the time available and capital requirement to conclude the associated asset acquisition. Resolutions 3 and 4 are special resolutions and have a 75% approval threshold.
General Meeting 03 June 2021
1. Does i3e intend to re-purchase its shares this year and if so, why is this money not being put into drilling?
i3 has no near-term plans to conduct share buybacks.
2. Are there any other repercussions of eliminating the Share Premium Account other than eliminating the retained losses?
No.
3. Does this resolution impact tax liabilities on future profits?
No.
4. Will the dividend paid quarterly or bi-annually?
A bi-annual dividend distribution is expected.
5. Can the value of the Q1 dividend be inferred as 20-30% of a quarters FCF?
FCF expectations will change across a given year resulting from fluctuations in productivity and realized commodity prices. Annual dividends will be trued to these actual figures once they have become historical.
6. How much free cash flow does the company have to generate before you increase the dividend payout ratio to 40%?
Above i3’s minimum commitment to distribute 20% of FCF to its shareholders, all capital decisions will be made in consideration of maximizing shareholder return.
7. Considering the large share-float and low trading multiples, why haven’t the company shown more interest in buying back shares?
i3 is acquiring assets and deploying operational capital at a return level that is below the Company’s trading multiple in the market. Buybacks would typically occur when that dynamic is reversed.