Lion signs agreement with KRX and Risco
Monday, June 17 2013 - 02:54 AM WIB
ASX-listed Lion Energy Limited announced that it has entered into a binding transaction coordination agreement and convertible loan agreement with KRX Energy Pte Ltd and Risco Energy Investments Pte Ltd.
With the agreement, the company has secured a US$1.5 million convertible loan facility in favour of the company from Risco, the company said in a press statement on Monday.
It also stated that it will raise $2,500,000 by the placement of 100,000,000 fully paid ordinary shares in the capital of the company to Risco (or its nominees).
It will also seek shareholder approval to issue up to 80,000,000 new shares to professional and sophisticated investors, and will acquire all of Risco?s rights to a 35 percent interest in an area of mutual interest agreement which includes various unconventional oil and gas joint study applications onshore Indonesia in consideration for the issue of 39,900,108 shares.
The funds provided under the convertible loan will be used to provide funding to KRX (by way of a loan) enabling KRX to meet cash call obligations in respect of the South Block A operation.
The company is currently a 30.77 percent shareholder of KRX as a result of its previous $1 million investment in KRX.
As announced on 22 January 2013, the Company and the KRX Shareholders had previously entered into a non-binding terms sheet in respect of the acquisition of all of the remaining issued capital in KRX.
However, that proposal was conditional, among other things, upon the parties entering into a formal share purchase agreement by 14 February 2013. This condition was never satisfied and the terms sheet was terminated.
The Proposed Transactions are viewed by the directors of the Company as the first steps in a major strategic initiative which will see the Company renew its focus on the South East Asian region through substantial exposure to the booming west Indonesian gas markets.
Editing by Benget Besalicto Tnb.