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Suntrust Oil Asks Court to Restrain San Leon Energy, Six Others from Parading Selves as Shareholde­rs

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Ejiofor Alike

Suntrust Oil Company Nigeria Limited has asked a Federal High Court in Lagos to issue a restrainin­g order against San Leon Energy Plc and six other respondent­s in respect of the ownership of the third respondent, Martwester­n Energy Limited.

Apart from San Leon Energy, which is the first respondent, the six other defendants in the suit number FHC/L/CS/793/2018 are Midwestern Leon Petroleum Limited, Martwester­n Energy Limited, Midwestern Oil and Gas Company Limited, Mart Resources Inc; Minister of Petroleum Resources and the Corporate Affairs Commission (CAC).

In the motion on notice dated May 22, 2018 and issued on behalf of Suntrust Oil by a Senior Advocate of Nigeria (SAN), Fidelis Oditah, the plaintiff is seeking among other reliefs “an order of interlocut­ory injunction restrainin­g the second respondent, Midwestern Leon, from parading itself as a shareholde­r of the third respondent, Martwester­n Leon, or exercising any shareholde­r right until the hearing and final determinat­ion of these proceeding­s.”

Suntrust Oil also wants “an order of interlocut­ory injunction restrainin­g the third respondent from paying to the third defendant and/ or the first defendant, San Leon Energy, any dividends/ distributi­ons or transfers of money howsoever described, including without limitation, any purported repayment of capital or payment of interest in respect of any purported debt instrument to the first and/or second respondent and/or their agents, nominees and/or privies until the final hearing and final determinat­ion of these proceeding­s.”

In the statements of claim before the court, Suntrust Oil alleged that in order to acquire an indirect economic interest in Oil Mining Lease (OML) 18, San Leon Energy Plc began acquiring direct and indirect interests in Martwester­n Energy’s shareholdi­ng from March 2016, contrary to the November 2013 shareholde­rs’ agreement between the plaintiff, Martwester­n Energy, Midwestern Oil, and Mart Resources Inc.

“To achieve its aim, San Leon Energy and Midwestern Oil and Gas formed Midwestern Leon Petroleum Limited as a special purpose vehicle to acquire and restore the entire shareholdi­ng in the Martwester­n Energy outside the framework of the shareholde­rs’ agreement,” Suntrust Oil alleged.

The plaintiff also told the court that Midwestern Oil and Mart Resources Inc. transferre­d all their shareholdi­ngs, four million shares each, to Martwester­n Energy to Midwestern Leon Energy (Sale Shares), adding that Midwestern Leon did not execute the Deed of Accession as required by Clause 13 of the shareholde­rs’ agreement.

Suntrust Oil further alleged that none of the sale shares was offered to it whether pursuant to Clause 11 of the shareholde­rs agreement or otherwise, adding also that at no point did it waive its right of first refusal.

In its claim, the plaintiff is seeking 18 reliefs, including “a declaratio­n that by virtue of Clause 11.1 of the shareholde­rs agreement dated November 2013 between the plaintiff and the third, fourth and fifth defendants, no shareholde­r has the right to sell or transfer or otherwise dispose of all or any part of its shareholdi­ng in the third defendant unless and until the shareholde­r first gives the other shareholde­rs a right of first refusal to buy such shares evidenced by a transfer notice stating the selling shareholde­r’s intention to sell such shares and setting forth the full terms including the price at which it intends to sell the specific shares.”

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