Energy technology company, LWP Technologies Limited, has announced that the company has entered into a US$6 million placement agreement with Lanstead Capital LP.
Pursuant to the placement agreement, UK-based specialist investment firm Lanstead Capital LP, will take up a placement of 1.2 billion shares at US$0.005/share. LWP will receive an initial payment of US$900 000, with the remaining US$5.1 million invested in the sharing agreement to be received over the next 18 months.
The sharing agreement allows LWP to secure much of the potential appreciation in the share price arising from future news flow. The value of the settlements received monthly over the next 18 months are based on a Benchmark price of US$0.0067/share calculated on the 5 day value weighted average price prior to settlement. If the price exceeds the Benchmark price, LWP will receive more than the monthly settlement due on a pro-rata basis, with no upper limit, if the price is below LWP will receive less than the monthly settlement on a pro-rata basis. It should be noted that the price paid does not impact on the number of shares issued.
LWP has agreed to make a value payment of 60 million shares as consideration for the sharing agreement.
The placement to Lanstead is subject to final documentation and agreements that are expected to be signed by Thursday the 28th July and to approval by shareholders at an EGM expected to be held on the 26th August 2016. At the time of the EGM this will give Lanstead a 19.9% shareholding in LWP.
The Company intends to strategically deploy these funds to advance the commercialisation of its unique energy technologies, namely:
- The ongoing development, commercialisation and licensing of LWP’s proprietary ceramic proppant technology.
- The development, commercialisation and licensing of its new aluminum-graphene-oxygen (air) battery technology.
LWP Chairman Siegfried Konig stated: “Securing this placement with Lanstead provides LWP with financial certainty and allows LWP to deliver on our dual track strategy of commercialising our two unique and disruptive energy technology offerings. Lanstead have a successful track record of investing in early stage ASX listed companies such as LWP, therefore it follows that Lanstead’s investment represents a solid endorsement of the Company and its technologies. I look forward to updating shareholders on our progress across the business in the coming weeks and months.”
The placement to Lanstead is subject to approval by shareholders at an Extraordinary General Meeting (EGM) to be held on 26 August 2016, as detailed in the Notice of Meeting that was filed with the ASX.
As previously communicated, (ASX announcement 7 June 2016), LWP’s staff and the Directors have voluntarily agreed to participate in the Company’s ongoing cost reduction initiatives. Shareholder approval will therefore also be sought at the EGM for the issue of LWP shares to Directors in lieu of cash remuneration as part of the Company’s cost reduction initiatives.
LWP Chairman Siegfried Konig said: “While LWP has adequate working capital on hand, plus additional funding provided by the Lanstead placement, the directors and staff of LWP have voluntarily agreed to be paid all or part of their remuneration by way of LWP shares which will decrease LWP’s cash outflows. That support, plus all of the directors having taken up their maximum entitlements of US$15 000 each under the Share Placement Plan that closed last week, provides further evidence of the confidence in the future prospects of LWP by LWP’s personnel”.
Adapted from a press release by David Bizley
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