Australia-based Lion Energy Limited has entered into a binding transaction coordination agreement and convertible loan agreement with Australia-based KRX Energy Private Limited and Indonesia-based Risco Energy Investments Private Limited. Based on this agreement, the company:
- has secured a $1.5 million convertible loan facility in its favour from Risco;
- will raise $2.5 million through the placement of 100,000,000 fully paid ordinary shares in its capital to Risco;
- will seek shareholders’ approval to issue up to 80,000,000 new shares to institutional investors; and
- will acquire all of Risco’s rights to a 35 per cent interest in the area of mutual interest agreement that includes various unconventional oil and gas joint study applications onshore Indonesia in consideration for the issue of 39,900,108 shares.
The funds raised by the company from Risco through the convertible loan will be used to provide funding to KRX (by way of a loan), thus enabling the company to meet cash call obligations with respect to its operations.