Open Letter to Toby Hayward

Toby Hayward.


Open Letter to the Interim CEO of Afren plc.


As a shareholder i have read the recent announcements with regards to re-capitalisation and trading updates with interest.

I wish that i could say that i read them in anything but disappointed interest.

As an Interim CEO I am sure you are aware that you, the Board of Directors and the Chairman have a duty to act in the interest of shareholders who are the owners of the company.


Before I vote and attend the EGM, I would like some clarification on a few points.


Point 1. Why did Afren not try to undertake a placing or rights issue when the share was many times higher than they currently are? As a shareholder this seems to be a colossal mistake costing Shareholders dearly.
Are any of the BOD, or yourself agreeing to a salary sacrifice for its failure ?


Point 2. In 2014 Afren produced 31.8kBOPD, why under its current financial problems is it then spending a Capex of $500m to achieve a production of 29-36kBPOD for 2015? It seems very strange to spend this money without predicting any firm increase in production and it seems strange to spend this money if the company simply doesn't have it?


Point 3. Can you confirm whether any of the Ad Hoc Committee members had shorted the Afren Share either pre or post its creation ? again shareholders would be happy to see "everyone all in this together", but only if Bondholders have not benefited from the collapse of Afren.


Point 4. You mention I believe for the first time that the Hedging facility was closed in Dec 2014. Can you confirm this was the case, can you also confirm why this has only been notified to share holders now? I believe this to be very price sensitive information when it occurred in Dec, for which the company had an obligation to inform the shareholders in a timely manner.


Point 5. Why are we re-finacing and diluting for the 2019-2020 debt? Trying to refinance debt due in 4 or 5 years time, when the company is at its weakest seems to be inadvisable.


Point 6. Am i right in saying that money will be raised by giving cheap shares to the bond holders, and then this money will be used to pay off the interest due on those bonds i.e given back to the bond holders? Surely this is a zero risk transaction for which the bondholders are being rewarded.


Point 7. Will Afren forgo the ability to issue share options or pay in shares for its senior managers and Board of Directors? it would seem inadvisable for the very people who are largely to blame for not raising funds when times where good to benefit from a low share price.


I have to say as a shareholder it appears to me that the Bond Holders will have made somewhere between 100-300% profit when all is said on and done on these Bonds. The Board of Directors and Senior management have and will continue to benefit from nice wages and secure jobs.


As a shareholder I am certainly not scared to vote NO in the EGM for these proposals, I would be happy to take the risk that the assets are worth more than the debt to certain parties, or that the bondholders would increase there offer.


If you can answer the questions above that would be appreciated, if not then I will try and ask them at the EGM, before I vote.


Thanks


(Awaiting response)