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Lone Star Value Questions Antares Board Over Asset Sales In Advance Of A Board Election

Lone Star Value Questions Antares Board Over Asset Sales In Advance Of A Board
                                   Election

Expresses Disappointment with Current Board's Disregard for Shareholder Rights

Renews Call on Antares Shareholders to Remove Two Employee Directors and Elect
Five Highly-Qualified, Independent Directors

PR Newswire

NEW YORK, June 13, 2014

NEW YORK, June 13, 2014 /PRNewswire/ --Lone Star Value Investors, LP, a
significant shareholder of Antares Energy Limited (ASX: AZZ) (OTC: AZZEF), is
seeking the removal of two of the current executive directors of Antares and
the election of five new independent and highly-qualified directors to the
Board at a meeting of the shareholders to be held on 22 July.

"We see an enormous opportunity to enhance value for all Antares shareholders
and the first step to unlocking this value is enhancing Antares' Board of
Directors with the independence and skills needed to get the job done.
However, in the meantime, the current Board should refrain from any and all
material decisions until the General Meeting is held" said Lone Star Value
founder and one of the candidate directors to the Antares Board of Directors,
Jeff Eberwein.

Lone Star Value criticised Antares CEO James Cruickshank for failing to adhere
to ASX best practices guidelines following his recent comments in an interview
in the press and at a sparsely attended annual general meeting revealing that
the Company may be in talks with an interested party for the sale of its
Southern Star asset and that it may be considering options for joint ventures
for Northern Star and Big Star. Lone Star Value believes this improper
disclosure is yet another indication that Antares' Board oversight needs to be
strengthened.

Lone Star Value has called on Antares to provide details about the potential
sale to ASX.

"While we are pleased that Mr. Cruickshank agrees with us on the benefits of
monetising and developing the Permian Basin assets with more established
partners, we do not think a Board dominated by the CEO and his employees
should be allowed to lead this process," Mr Eberwein said.

"Consistent with its past practices, Antares has provided only scattered
information about its potential strategic opportunities in the Permian, far
short of fulsome disclosure shareholders should expect (or ASX best practices
advocate). We fear Mr. Cruickshank and his fellow directors are attempting to
keep their positions on the Board by making vague promises to shareholders
that value-realisation is just around the corner.

"The current Board needs to be enhanced for the full value of Antares' assets
in the Permian Basin to ever be maximised. In our view, the current Board does
not have the expertise to run a successful sales process with sophisticated
counterparties in the Permian Basin, especially given the sparse Permian Basin
experience of the incumbent directors and lack of relevant M&A experience,
legal experience, or oil & gas financial experience. Lone Star Value has
proposed a robust strategic alternative review process as the key plank to the
future of Antares - to be led by an independent Board that has the relevant
experience, industry connections, regional knowledge, and a clear commitment
to shareholder rights and value."

In criticising the current Board structure of three executives and only one
independent director, Lone Star Value stated that Mr. Cruickshank has impaired
shareholder value and Board independence by concentrating all critical
decision-making power through his combined role as the Executive Chairman of
the Board, Chief Executive Officer, Managing Director, and a member of the
Audit & Compliance Committee and Remuneration Committee.

"In our view, this Board is deeply entrenched," Mr. Eberwein said. "We are
disappointed that the Board rejected our offer to hold a meeting at our
expense and instead insisted on a meeting that gives them greater control but
for which all shareholders must pay. They have also refused to include in the
agenda a proposal that would invalidate any unilateral appointments to the
Board they make prior to the general Meeting which may make the shareholders
selection of their representatives on the Board less impactful. We believe
that these entrenchment tactics and poor corporate governance are major
reasons Antares shares trade at such a large discount to their intrinsic value
and why Antares has underperformed its Permian Basin peers."

Lone Star Value made note that its candidates have deep experience in a broad
range of areas, and are all independent and are not receiving any outside
remuneration from Lone Star Value. "Naturally, I am compensated for my
employment with Lone Star Value but not for serving as its director candidate.
In fact, it is our intention that should our candidates be elected, overall
Board compensation will remain the same despite an increase in Board numbers.
Our Board nominees' interests are fully aligned with all shareholders and our
nominees have only one goal – to maximise value for the benefit of all
shareholders of Antares." Mr. Eberwein said.

Lone Star Value urged all Antares shareholders to read carefully the materials
that Lone Star Value is mailing to them today as those materials contain
important information. Lone Star Value called on shareholders to vote on its
blue and white proxy card to improve the Board of Antares.

Lone Star Value contact:
Jeffrey E. Eberwein
Lone Star Value Investors, LP
+1.203.542.0235

Media enquiries please contact:
John Hurst
Cannings Corporate Communications
+61 418 708 663

SOURCE Lone Star Value Management, LLC
 
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