STOCKHOLDER SUPPORT AND IRREVOCABLE PROXY AGREEMENT
EXECUTION
VERSION
STOCKHOLDER
SUPPORT AND IRREVOCABLE PROXY AGREEMENT, dated as of September 22, 2008 (this
“Agreement”),
between United Energy Group Limited, an exempted company with limited liability
existing under the laws of Bermuda (“Purchaser”), and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the “Stockholder”). Defined
terms used but not defined herein shall have the meanings ascribed to such terms
in the Investment Agreement (as defined below).
WHEREAS,
as of the date hereof, the Stockholder owns of record and beneficially and has
good, valid and marketable title to, and has the sole power to vote and full
right, power and authority to sell, transfer and deliver 12,482,981 shares of
common stock, par value US$0.0006 per share (the “Common Stock”), of
Transmeridian Exploration Incorporated, a Delaware corporation (the “Company”) (all such
shares of the Common Stock and any shares of the Common Stock of which ownership
of record or the power to vote is hereafter acquired by the Stockholder prior to
the termination of this Agreement, whether upon the conversion of convertible
securities, or by means of purchase, dividends, distribution, exchange of
shares, gift, bequest or as a successor in interest in any capacity or
otherwise, being referred to herein as the “Shares”);
WHEREAS,
on June 11, 2008, Purchaser and the Company entered into that certain Investment
Agreement, as amended by a letter agreement dated July 22, 2008 (as amended, the
“Original Investment
Agreement”);
WHEREAS,
concurrently herewith, Purchaser and the Company are entering into that certain
Amended and Restated Investment Agreement, dated as of June 11, 2008 and amended
and restated as of September 22, 2008, which amends and restates the Original
Investment Agreement in its entirety (as it may be amended from time to time,
the “Investment
Agreement”); and
WHEREAS,
as a condition and inducement to Purchaser’s entering into the Investment
Agreement and incurring the obligations set forth therein, Purchaser has
required that the Stockholder enter into this Agreement.
NOW,
THEREFORE, in consideration of the foregoing and of the mutual covenants and
agreements contained herein, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:
1. Grant of Irrevocable
Proxy. The Stockholder, by this Agreement, with respect to his
Shares and solely in his capacity as a stockholder of the Company, hereby grants
an irrevocable proxy and power of attorney to Purchaser with full power of
substitution and resubstitution (and agrees to execute such additional documents
or certificates evidencing such proxy as Purchaser or its designees may
reasonably request) to cause the Shares to be represented at any meeting and any
adjournment or postponement thereof for quorum purposes and
to vote, at any meeting of the stockholders of the Company and any adjournment
or postponement thereof, and take action by written or electronic consent, (a)
in favor of the approval and adoption of (i) any amendments to the Company’s
Amended and Restated Certificate of Incorporation, including any Certificate of
Designations relating to any series of the Company’s preferred stock, required
to consummate the transactions contemplated by the Investment Agreement; (ii)
the issuance of the new convertible preferred stock of the Company required to
consummate the transactions contemplated by the Investment Agreement; and (iii)
any other matters required by applicable Law or otherwise to approve and adopt
the Investment Agreement and approve the transactions contemplated thereby; (b)
against any action, agreement or transaction (other than the transactions
contemplated by the Investment Agreement) or proposal that would result in a
breach of any covenant, representation or warranty or any other obligation or
agreement of the Company under the Investment Agreement or that could result in
any of the conditions to the Company’s obligations under the Investment
Agreement not being fulfilled; and (c) in favor of any other matter necessary to
the consummation of the transactions contemplated by the Investment Agreement
and considered and voted upon (or consented to) by the stockholders of the
Company. THIS PROXY IS IRREVOCABLE AND COUPLED WITH AN INTEREST
SUFFICIENT IN LAW TO SUPPORT AN IRREVOCABLE POWER. The Stockholder
hereby revokes each proxy and power of attorney he may have heretofore granted
with respect to the Shares. Notwithstanding any of the foregoing,
this proxy shall be limited to matters reasonably required in order to
consummate the transactions contemplated by the Investment Agreement; the
Stockholder shall retain his voting rights with respect to all other matters
(except to the extent set forth in the
Stock
Purchase Agreement, dated as of June 11, 2008, between the Stockholder and
Purchaser (the “SPA”)).
2. Restrictions on
Transfer. The Stockholder agrees that he shall not transfer,
sell, tender, assign, option, pledge, hypothecate, put, convert or redeem or
otherwise directly, indirectly or by operation of Law or otherwise (including
without limitation by merger or sale of equity in any direct or indirect holding
company), dispose of or subject to any Encumbrance any of the
Shares.
3. Representations and
Warranties of the Stockholder. The Stockholder hereby
represents and warrants to Purchaser as follows:
(a) The
Stockholder has full capacity to execute and deliver this Agreement, to perform
his obligations hereunder and to consummate the transactions contemplated
hereby. This Agreement has been duly executed and delivered by the
Stockholder and (assuming the due authorization, execution and delivery by
Purchaser) constitutes a legal, valid and binding obligation of the Stockholder,
enforceable against the Stockholder in accordance with its terms, except as may
be limited by bankruptcy, insolvency, fraudulent conveyance, fraudulent
transfer, reorganization, moratorium or other similar Laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles (whether considered in a proceeding in equity or at
law). The failure of the spouse, if any, of the Stockholder to be a
party or signatory to this Agreement shall not (i) prevent the Stockholder from
performing his obligations and consummating the transactions contemplated
hereunder or (ii) prevent this Agreement from constituting the legal, valid and
binding obligation of the Stockholder in accordance with its terms.
(b) The
execution and delivery of this Agreement by the Stockholder do not, and the
performance of this Agreement by the Stockholder will not (A) conflict with or
violate any Law applicable to the Stockholder or by which any property or asset
of the Stockholder is bound or affected, or (B) result in any breach of or
constitute a default (or an event which, with notice or lapse of time or both,
would become a default) under, or give to others any right of termination,
amendment, acceleration or cancellation of, or result in the creation of any
Encumbrance on any property or asset of the Stockholder pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation, except for any such conflicts,
violations, breaches, defaults or other occurrences as would not, individually
or in the aggregate, prevent or materially delay the performance by the
Stockholder of any of his obligations pursuant to this Agreement.
(c) The
execution and delivery of this Agreement by the Stockholder do not, and the
performance of this Agreement by the Stockholder will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
Governmental Authority on the part of the Stockholder.
(d) As
of the date hereof, the Stockholder owns of record and beneficially 12,482,981
Shares. Other than as set forth herein, there are no voting trusts,
agreements, proxies or other agreements or understandings in effect with respect
to the Shares.
(e) None
of the information relating to the Stockholder provided by or on behalf of the
Stockholder for inclusion in any disclosure document, including any offer to
purchase or proxy statement, to be prepared pursuant to applicable Law by
Purchaser or the Company in connection with the Transactions (the “Disclosure
Documents”) will, at the respective times the Disclosure Documents are
filed with the SEC or are first published, sent or given to stockholders of the
Company, contain any untrue statement of material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(f) No
broker, finder or investment banker is entitled to any brokerage, finder’s or
other fee or commission in connection with the transactions contemplated by this
Agreement based upon arrangements made by or on behalf of the
Stockholder.
4. Representations and
Warranties of Purchaser. Purchaser hereby represents and
warrants to the Stockholder as follows:
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(a) This
Agreement has been duly executed and delivered by Purchaser and (assuming the
due authorization, execution and delivery by the Stockholder) constitutes a
legal, valid and binding obligation of Purchaser, enforceable against Purchaser
in accordance with its terms, except as may be limited by bankruptcy,
insolvency, fraudulent conveyance, fraudulent transfer, reorganization,
moratorium or other similar Laws relating to or affecting the rights and
remedies of creditors or by general equitable principles (whether considered in
a proceeding in equity or at law).
(b) The
execution and delivery of this Agreement by Purchaser do not, and the
performance of this Agreement by Purchaser will not (A) conflict with or violate
any Law applicable to Purchaser or by which any property or asset of Purchaser
is bound or affected, or (B) result in any breach of or constitute a default (or
an event which, with notice or lapse of time or both, would become a default)
under, or give to others any right of termination, amendment, acceleration or
cancellation of, or result in the creation of any Encumbrance on any property or
asset of Purchaser pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation,
except for any such conflicts, violations, breaches, defaults or other
occurrences as would not, individually or in the aggregate, prevent or
materially delay the performance by Purchaser of any of its obligations pursuant
to this Agreement.
(c) The
execution and delivery of this Agreement by Purchaser do not, and the
performance of this Agreement by Purchaser will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
Governmental Authority on the part of Purchaser.
(d) Other
than Citigroup Global Markets Inc., no broker, finder or investment banker is
entitled to any brokerage, finder’s or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of Purchaser.
5. Additional
Shares. The Stockholder agrees, while this Agreement is in
effect, to give prompt written notice to Purchaser of the number of any new
Shares acquired (or for which voting rights are acquired) by the Stockholder
after the date hereof.
6. Termination. This
Agreement shall be terminated and the transactions contemplated hereby shall be
abandoned at the earlier of (a) the Swap Closing and (b) the date the Investment
Agreement is terminated pursuant to Article X thereof.
7. Disclosure. The
Stockholder hereby authorizes and agrees to permit Purchaser to publish and
disclose the Stockholder’s identity and ownership of Shares and the nature of
his commitments, arrangements and understandings under this Agreement in any
disclosure document required by Law, including the Securities Laws, in
connection with the transactions contemplated by the Investment Agreement and
this Agreement.
8. Miscellaneous.
(a) Expenses. Except
as otherwise provided herein, all costs and expenses, including fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses, whether or not the Swap
Closing shall have occurred.
(b) Notices. All
notices, requests, claims, demands and other communications hereunder shall be
in writing and shall be given or made (and shall be deemed to have been duly
given or made upon receipt) by delivery in person, by courier service, by
facsimile upon written confirmation of delivery or by registered or certified
mail (postage prepaid, return receipt requested) to the respective parties at
their addresses as specified on the signature page(s) of this
Agreement.
(c) Waiver. The
waiver by a party of compliance with any provision of this Agreement by another
party shall not operate or be construed as a waiver of any other provision of
this Agreement or of any subsequent breach by such party of a provision of this
Agreement.
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(d) Assignment. Neither
this Agreement, nor any right, obligation or interest hereunder may be assigned
or otherwise transferred or disposed of, whether by operation of Law, security
or otherwise, by the Stockholder or Purchaser without the prior written consent
of the other and any attempted assignment without the required consent shall be
void; provided,
however, that
Purchaser may assign all or any of its rights and obligations hereunder to any
Affiliate of Purchaser, provided that no such
assignment shall relieve the assigning party of its obligations hereunder if
such assignee does not perform such obligations. For the avoidance of
doubt, Purchaser shall be entitled to conduct the transactions contemplated by
this Agreement through a wholly owned subsidiary of Purchaser; provided, however, that
Purchaser shall guarantee the obligations of such subsidiary in connection
therewith.
(e) Severability. If
any term or other provision of this Agreement is invalid, illegal or incapable
of being enforced by any rule of law or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any
party.
(f) No Third Party
Beneficiaries. This Agreement shall be binding upon and inure
solely to the benefit of the parties hereto and their respective successors and
permitted assigns, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other Person any legal or equitable right,
benefit or remedy of any nature whatsoever under or by reason of this
Agreement.
(g) Specific
Performance. The parties hereto agree that irreparable damage
would occur in the event any provision of this Agreement was not performed in
accordance with the terms hereof and that the parties shall be entitled to
specific performance of the terms hereof, in addition to any other remedy at law
or in equity.
(h) Governing
Law. This Agreement shall be governed by, and construed in
accordance with, the Laws of the State of New York applicable to contracts
executed in and to be performed in that State. All actions and
proceedings arising out of or relating to this Agreement shall be heard and
determined exclusively in any New York state or federal court sitting in The
City of New York. The parties hereto hereby (i) submit to the
exclusive jurisdiction of any state or federal court sitting in The City of New
York for the purpose of any action or proceeding arising out of or relating to
this Agreement brought by any party hereto, and (ii) irrevocably waive, and
agree not to assert by way of motion, defense, or otherwise, in any such action
or proceeding, any claim that is not subject personally to the jurisdiction of
the above-named courts, that its property is exempt or immune from attachment or
execution, that the action or proceeding is brought in an inconvenient forum,
that the venue of the actions and proceedings is improper, or that this
Agreement or the transactions contemplated hereby may not be enforced in or by
any of the above-named courts.
(i) Waiver of
Jury Trial. Each of the parties hereto hereby
waives to the fullest extent permitted by applicable law any right it may have
to a trial by jury with respect to any litigation directly or indirectly arising
out of, under or in connection with this Agreement or the transactions
contemplated hereby. Each of the parties hereto (i) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce that foregoing waiver and (ii) acknowledges that it and the other
parties hereto have been induced to enter into this Agreement and the
transactions contemplated hereby, as applicable, by, among other things, the
mutual waivers and certifications in this Section 8(i).
(j) Entire
Agreement. This Agreement, the Investment Agreement and the
SPA constitute the entire agreement between the parties with respect to the
subject matter hereof and supersede all prior agreements and undertakings, both
written and oral, among the parties, or any of them, with respect to the subject
matter hereof.
(k) Amendment. This
Agreement may not be amended except by an instrument in writing signed by each
of the parties hereto.
(l) Counterparts. This
Agreement may be executed and delivered (including by facsimile transmission) in
one or more counterparts, and by the parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above.
| UNITED ENERGY GROUP LIMITED | |||
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||
| Name: | ▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||
| Title: | Chairman and Executive Director | ||
| Address: | |||
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/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||
| Name: | ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||
| Address: | |||