Petrogrand: Withdraws Shelton Board Member Request and Waits for Annual Report

Petrogrand AB announced on 21 March 2014 at 16:05 CET a public cash offer to the owners of shares, convertible bonds and warrants in Shelton Petroleum AB.

In the light of the recommendation by the Securities Council, as well as new information regarding the number of shares in Shelton Petroleum, Petrogrand has decided the following:

1)   To withdraw the proposal for election of a board of directors in Petrogrand’s request for an Extraordinary General Meeting in Shelton Petroleum dated 28 March 2014 Proposal for minority auditor remains. In addition, Petrogrand will instead propose a new board at the Annual General Meeting of Shelton Petroleum 20 May 2014;

2)   To postpone the previously announced tentative timetable for the Offer. The reasons for the postponement include providing the shareholders in Shelton Petroleum and Petrogrand the opportunity to take part of the annual report and information from the period from January to March 2014 that Shelton Petroleum, according to their calendar, will publish in April.

The new estimated time schedule is as follows:

Publication of the Offer document   17 April 2014

Acceptance period   22 April 2014 — 13 May 2014

Settlement                                            22 May 2014

3)   To clarify that the Offer is not conditional upon that an independent due diligence of Shelton Petroleum may be made. Due to a clerical error the summary of the press release regarding the publication of the Offer included a writing from an early draft that the completion of the Offer would be subject to Petrogrand completing a due diligence of Shelton Petroleum. Petrogrand will withdraw its request for due diligence and await the audited Annual Report or other public information, to remove the uncertainty surrounding Shelton Petroleum’s short-term receivables and other assets, and therefore the value of Shelton Petroleum.

4)   Petrogrand also makes a clarification in relation to the conditions of the Offer in respect to Petrogrand reserving the right to restate compensation per A-share, B-Share, convertible bond and / or warrant in the event that the number of outstanding shares, convertible bonds or warrants would be subject to change until the end of the acceptance period. Petrogrand clarifies that such a conversion will only occur in the event that such a change in the number of outstanding shares, convertible bonds or warrants would result in the value per share of Shelton Petroleum decreasing.