Solimar Announces Private Placement and Extension of Debenture Maturity Date

Solimar Announces Private Placement and Extension of Debenture Maturity Date
  
 

MELBOURNE, AUSTRALIA--(Marketwired - Jan 31, 2014) - Solimar Energy Limited ("Solimar" or the "Company") (ASX:SXS)(TSX-VENTURE:SXS) is pleased to announce that, subject to TSXV approval, it intends to complete a non-brokered private placement for aggregate gross proceeds of up to C$2,000,000 via the issuance of Units at a price of C$0.065 per Unit. Each Unit will be comprised of one common share and one half of one right. Each right will entitle the holder to acquire one warrant upon shareholder approval of the conversion of the rights to warrants. Assuming shareholder approval is obtained, each warrant will allow the holder to purchase one common share of the Company at a price of C$0.065 for a 24 month period following closing.

The private placement is expected to close in tranches with a first closing on January 31, 2014.

The Company intends to hold a shareholder meeting before the end of March 2014 in order for, among other things, shareholders to vote on, and if deemed appropriate, to approve the conversion of the rights to warrants.

Following or concurrent with the shareholder meeting the Company intends to proceed with an ASX rights offering.

In connection with the extension of the debentures issued pursuant to the debenture indenture dated June 26, 2012, as amended and restated August 14, 2013, entered into among the Company and Computershare Trust Company of Canada ("Computershare"), the Company has granted first priority security to such Debenture holders over all of the assets of the Company and its subsidiaries and has instructed Computershare to pay an extension fee of $250,000 payable rateably and proportionately to such holders on January 31, 2014. The new maturity date for the debentures is July 31, 2014.

Proceeds of the placements will be used for oil and gas activities, operating and debt servicing costs.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Reader Advisory: Forward-looking statements

This news release contains forward-looking information relating to the private placement, planned development and exploration activities on the properties in which the Company has interests, and other statements that are not historical facts. Such forward-looking information is subject to important risks, uncertainties and assumptions. The results or events predicated in this forward-looking information may differ materially from actual results or events. As a result, you are cautioned not to place undue reliance on this forward-looking information.

Forward-looking information is based on certain factors and assumptions. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward looking-information is subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what is currently expected. These factors include risks associated with the private placement, risks associated with instability of the economic environments in which the Company operates or owns interests, oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, reliance on key personnel, regulatory risks and delays, including risks relating to the acquisition of necessary licenses and permits, environmental risks and insurance risks.

You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While the Company may elect to, the Company is under no obligation and does not undertake to update this information at any particular time, except as required by law.

ABN 42 112 256 649

Solimar Energy LimitedJason BednarDirector+1 805 643 4100 or [phone]www.solimarenergy.com.au