WHL Inks Agreement With Energy Capital Partners to Recapitalize Firm

Australian energy company WHL Energy Limited (WHL Energy or the Company) disclosed Tuesday that the Company has entered into agreements with Energy Capital Partners Pty Ltd (ECP) to facilitate a recapitalization of the Company.


WHL Energy has moved to implement a definitive action plan for immediate funding and cost savings in order to stabilize the Company’s financial position.

The Company's directors have worked tirelessly over the past months to source funding solutions in the best interests of shareholders in a difficult financial market. The Company has considered alternatives and believes that the ECP recapitalization proposal is the only proposal currently executable within the timeframe required by the company’s third party debt providers.

In order for the Company to meet its immediate funding requirements to lenders and creditors it has accepted an offer that, while heavily dilutive to shareholders, allows the Company to recapitalize and restructure its forward financial and asset position and continue to implement a significant cost reduction strategy.

Recapitalization Offer

The recapitalization proposal comprises the issue of convertible notes (Convertible Notes) secured over the Company’s assets to the value of $1.6 million (AUD 2 million), converting into ordinary fully paid shares in the Company at $0.0008 (AUD 0.001) (subject to shareholder approval). Subject to the satisfaction of certain conditions precedent, ECP will subscribe for, or procure the subscription for, the Convertible Notes in two tranches of $0.8 million (AUD 1 million) June 4 and 19. If shareholder approval is obtained for the conversion of the Convertible Notes, approximately 2 billion new ordinary shares in the Company will be issued.

In consideration for ECP procuring the subscription for Convertible Notes, the Company has agreed to issue ECP shares and options in the Company and pay fees on the terms set out in the schedule to this announcement.The Company will convene a shareholder meeting in due course to seek approval for the issue of the shares upon conversion of the Convertible Notes along with the issue of the ECP Options. If shareholder approval is obtained, the Convertible Notes will convert into shares in the Company.

Proceeds from the recapitalization will be used:


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