Material Fact - Reverse Split of Common Shares and Global Depositary Shares Approved

RIO DE JANEIRO, June 24, 2014 /CNW/ - HRT Participações em Petróleo S.A. (the "Company" or "HRT") (BM&FBOVESPA: HRTP3, TSX-V: HRP), announces today that, at the Special Shareholders` Meeting ("SSM") of the Company, held on this date, upon second call, among other matters, the shareholders of the Company approved the reverse split of the Company's common shares at the rate of ten (10) common shares for one (1), pursuant to Article 12 of Law 6,404/76, which also includes the reverse split of the issued and outstanding Global Depositary Shares ("GDSs") of the Company, at the rate of ten (10) GDSs for one (1), maintaining the proportion currently in force of two (2) GDSs to one (1) common share.

In the context of discussions on the Management Proposal for the reverse stock split at a ratio of thirty (30) common shares to one (1), the Company's shareholders resolved by majority, to approve the reverse stock split at a ratio of ten (10) common shares to 1 (one), in line with the proposal submitted by a shareholder of the Company, which is more suitable to its current situation.

Background and Reasons for the Reverse Split

The Company's proposal to effect the reverse split is in line with the understanding that, further to some indications received from the BM&FBOVESPA's Company Follow-up Department. In the opinion of BM&FBOVESPA Exchange, such a target price protects companies from being affected by high fluctuations in percentage, resulting from low fluctuations in stock prices.

Furthermore, in February 2014, the BM&FBOVESPA Exchange enacted the new regulations for the Listing of Issuers and Admission of Securities for Trading (Regulamento para Listagem de Emissores e Admissão à Negociação de Valores Mobiliários), created with the aim to improve and streamline the relationship of issuers with the BM&FBOVESPA Exchange and market participants. This regulation will be in place from August 2014.

Effects of the Reverse Split

The shareholders (holders of common shares or GDSs) will have until August 1, 2014 to, at its discretion, dispose of or acquire as many shares as necessary in order to eliminate fractions of shares that may result from the completion of the reverse split by the Company.

After such date, the group of shares which compose the share fractions will be sold through an auction on the stock exchange, by an intermediary of a brokerage firm, in Brazil, and a selling agent, in Canada. The proceeds resulting from the sale of the fractions of common shares and GDSs will be credited to their holders.

As of August 4, 2014, the common shares and GDSs will be traded on a reverse split basis. The reverse split will not affect (i) the amount (in Brazilian reais (R$)) of the Company's consolidated Capital Stock, (ii) the rights attributed to common shares and GDSs, or (iii) the ownership interest of each shareholders in the Company's Capital Stock, except to the extent that the reverse split, or otherwise, results in a shareholder owning a fraction of common share or GDS, as the case may be.

The subscription bonuses and the stock options or subscription for common shares issued by the Company will also be proportionally adjusted to reflect the reverse split.

The reverse split will not result in a change of the Company's name.

As at June 24, 2014, 297,466,746 common shares of the Company are issued and outstanding. Upon completion of the reserve split of common shares approved at the SSM, there will be approximately 29,746,675 common shares of the Company issued and outstanding (on a non-diluted basis and subject to fractions as discussed in this material fact). As at the same date, 118,090,300 GDSs are issued and outstanding. Upon completion of the reserve split of GDSs also approved at the SSM, there will be approximately 11,809,030 GDSs issued and outstanding (on a non-diluted basis and subject to fractions as discussed in this material fact).

For additional information, please contact HRT's Investor Relations Department.

Sedar Profile # 00031536

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

About HRT

HRT Participações holds one of the largest independent oil and gas exploration and production companies in Brazil. The HRT Group comprises six main subsidiaries: IPEX (Integrated Petroleum Expertise Company Serviços em Petróleo Ltda.), HRT O&G Exploração e Produção de Petróleo Ltda., HRT Netherlands B.V., HRT África Petróleo S.A., HRT América Inc. and HRT Canada Inc.. The Company retains a 55% interest in 19 exploratory blocks in the Solimões Basin and 60% of interest in The Polvo Field, located in the southern portion of the Campos Basin. HRT also operates 10 exploratory blocks off the Namibian coast: eight blocks in the Orange Sub-basin and two blocks in the Walvis Sub-basin. HRT's team includes PHDs and masters in geochemistry, geophysics, biology and engineering, most of them former employees of Petrobras and ANP (Brazil petroleum agency). HRT is committed to minimizing any possible environmental impacts in the sites where it acts. Our commitment to the local communities is towards health conditions, safety and quality of life. For more information, please visit the Company's website:


This news release contains forward-looking statements. All statements other than statements of historical fact contained in this news release are forward-looking statements, including, without limitation, statements regarding our drilling and seismic plans, operating costs, acquisitions of equipment, expectations of finding oil, the quality of oil we expect to produce and our other plans and objectives. Readers can identify many of these statements by looking for words such as "expects", "believe", "hope" and "will" and similar words or the negative thereof. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. By their nature, forward-looking statements require us to make assumptions and, accordingly, forward-looking statements are subject to inherent risks and uncertainties. We caution readers of this news release not to place undue reliance on our forward-looking statements because a number of factors may cause actual future circumstances, results, conditions, actions or events to differ materially from the plans, expectations, estimates or intentions expressed in the forward-looking statements and the assumptions underlying the forward-looking statements.

The following risk factors could affect our operations: the contingent resource and prospective resource evaluation reports involving a significant degree of uncertainty and being based on projections that may not prove to be accurate; inherent risks to the exploration and production of oil and natural gas; limited operating history as an oil and natural gas exploration and production company; drilling and other operational hazards; breakdown or failure of equipment or processes; contractor or operator errors; non-performance by third party contractors; labour disputes, disruptions or declines in productivity; increases in materials or labour costs; inability to attract sufficient labour; requirements for significant capital investment and maintenance expenses which HRT may not be able to finance; cost overruns and delays; exposure to fluctuations in currency and commodity prices; political and economic conditions in Namibia and Brazil; complex laws that can affect the cost, manner or feasibility of doing business; environmental, safety and health regulation which may become stricter in the future and lead to an increase in liabilities and capital expenditures, including indemnity and penalties for environmental damage; early termination, non-renewal and other similar provisions in concession contracts; and competition. We caution that this list of factors is not exhaustive and that, when relying on forward-looking statements to make decisions, investors and others should also carefully consider other uncertainties and potential events. The forward-looking statements herein are made based on the assumption that our plans and operations will not be affected by such risks, but that, if our plans and operations are affected by such risks, the forward-looking statements may become inaccurate.

The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this news release are made as of the date of this news release. Except as required by applicable securities laws, we do not undertake to update such forward-looking statements.

SOURCE: HRT Participações em Petróleo S.A.

For further information:

Eduardo Larangeira Jácome - Organizational Management and Investor Relations Officer
Sandra Calcado - Investor Relations Manager
Tainah Costa - Investor Relations Senior Analyst 

+55 21 2105-9700

Profil de l'entreprise

HRT Participações em Petróleo S.A.

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