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FIRESTONE ENERGY LIMITED - First Stage Settlement Completed

Release Date: 05/02/2013 08:00
Code(s): FSE     PDF:  
Wrap Text
First Stage Settlement Completed

           
FIRESTONE ENERGY LIMITED
(Incorporated in Australia)
(Registration number ABN 058 436 794)
Share code on the JSE Limited: FSE  
Share code on the ASX: FSE
ISIN: AU000000FSE6
(SA company registration number 2008/023973/10)
("FSE" or "the Company")





 5 February 2013                                                                             About Firestone Energy

                                                                                             Firestone Energy Limited is an
                                                                                             independent, Australian exploration and
                 1st stage Settlement Occurs under the Financial Restructure                   development company listed on the
                                                                                             Australian Stock Exchange Ltd (ASX) and
         The Board of Firestone Energy Limited (ASX/JSE: FSE) (the “Company” or              the Johannesburg Stock Exchange (JSE).
         “Firestone”) is pleased to advise that the first stage of Completion has occurred   Firestone Energy has entered into a Joint
         and that the Company has issued 27.145 million new secured convertible notes in     Venture with Sekoko Resources (Pty) Ltd
         accordance with the Restated Investment Agreement between the Company,              through which Firestone Energy has
         Ariona Company SA (Ariona), BBY Nominees Pty Ltd and Jaguar Funds                   acquired the right to 60% participation
                                                                                             interests in the Waterberg Coal Project
         Management Limited.                                                                 located in Lephalale area, Limpopo Province,
                                                                                             South Africa.
         Under the First Completion, Firestone received $5million in cash (less reimbursed
         costs). The $5 million comprised the additional $600,000 in interim funding         The first stage of the project is to develop the
         Firestone received as announced on 17 December 2012 and the drawdown from           Smitspan mine which has a substantial
         the original $1 million working capital facility, which was rolled into the new     measured thermal coal resource and to
         convertible notes.                                                                  develop the Vetleegte mine which is a
                                                                                             substantial metallurgical coal deposit.
         As a result Firestone has now issued $27.145 million of new convertible notes
                                                                                             Firestone Energy is committed to becoming a
         (NCNs) to Ariona for;
                                                                                             profitable independent coal and energy
                                                                                             producer at its projects in South Africa,
              • the injection of A$5 million of cash into Firestone, and                     thereby making a substantial contribution to
              • the redemption and replacement of $21.3 million of Existing Convertible      the social and economic development of the
                 Notes (ECNs) and accrued interest of $845,000.                              Lephalale area and South Africa.

                                                                                             Corporate Details
         In addition the holders of the ECNs were issued 241,145,620 fully paid ordinary                                          ASX: FSE
         shares in the Company in satisfaction of the balance of the interest which had                                           JSE: FSE
         accrued on the ECNs.
                                                                                                                             Issued Capital:
                                                                                                              3,114 million ordinary shares
         In accordance with the approval of shareholders provided at the General Meeting
         held on 5 October 2012, as a result of the redemption of the Existing Convertible                            Major Shareholders:
                                                                                                               Sekoko Resources (Pty) Ltd
         Notes, 300 million incentive options were issued to the former holders of the                                     Linc Energy Ltd
         ECNs.                                                                                                     BBY Nominees Pty Ltd
                                                                                                                 Bell Potter Nominees Ltd

         Under the Second Completion, Ariona will provide a further $12.5 million for                              Directors and Officers
         NCNs which will be applied to additional working capital. Second Completion is
                                                                                                               Non Executive Directors:
         scheduled to occur by not later than 28 February 2013.                                                Mr Tim Tebeila (Chairman)
                                                                                                         David Perkins (Deputy Chairman)
                                                                                                                           Dr Pius Kasolo
                                                                                                                          Ben Mphahlele
         In accordance with the Restated Investment Agreement, from conclusion of First                                 Kobus Terblanche
         Completion, Ariona nominated and Firestone appointed, three persons to the
                                                                                                                              Officers:
         Board of Firestone, namely Mr David Hillier, Mr Oren Zohar and Mr Jack Robert                              Mr David Knox CEO
         James. A brief bio for each of those directors is set out below:                                       Ms Amanda Matthee CFO
                                                                                                      Mr Jerry Monzu Company Secretary
         Mr David Hillier
                                                                                                                                 Contact:
                                                                                                             Suite B9, 431 Roberts Road
         David Hillier is a chartered accountant and has more than 30 years experience in               Subiaco, Western Australia 6008
         the resources industry globally. Mr Hillier was previously Executive Chairman of                        Tel: +61 (08) 9287 4600
         Buka Gold Limited which successfully identified a number of gold anomalies in the             Web: www.firestoneenergy.com.au
         Maryborough Basin in Queensland, an area not previously considered prospective
         for gold. Throughout 2008 he worked as Chief Financial Officer, and subsequently as an executive
         director, of Buka's major shareholder based in London. Between 1989 and 2002, Mr Hillier held a
         range of senior executive positions in the Normandy Mining Limited Group of companies and was
         Chief Financial Officer of Normandy for six of these years. He has served as Chairman and as a director
         of a number of public companies in the mining and exploration field. Mr Hillier is a currently Chairman
         of Lawson Gold Limited and Non-Executive Director of Phoenix Copper Limited.

         Mr Zohar

         Mr Zohar holds a Bachelor of Commerce degree from UWA, and a Master of Business Administration
         from Melbourne Business School. He is also a Chartered Accountant, registered and official liquidator.
         Mr Zohar has practised in the areas of corporate restructuring and advisory for over 20 years. He was a
         founding partner of KordaMentha (WA).

         After retiring from KordaMentha in 2006, Mr Zohar co-founded a boutique corporate advisory and
         private equity firm, which held an AFS Licence, provided specialist advisory services for clients and
         sourced, negotiated and project managed several syndicated investment opportunities.

         Mr Zohar has recently been appointed as Acting Managing Director of Frankland River Olive Company
         Ltd and is also a Director of Black Star Petroleum Limited.

         Mr Jack James

         Mr James has a Bachelor of Business from the Queensland University of Technology and is a Chartered
         Accountant.

         Mr James provides accounting, secretarial and advisory advice to private and public companies,
         government and other stakeholders. Mr James has over fifteen years' experience in chartered
         accounting specialising in corporate advisory and reconstruction. Most recently, he held senior roles in
         Ernst & Young and KordaMentha.

         Mr James is currently a Director of Eumeralla Resources Limited and Black Star Petroleum Limited.

         The Company has also used the opportunity of First Completion to repay $1,457,006 drawn down on a
         finance facility provided by BBY by issuing 194,674,462 fully paid ordinary shares.

         "The redemption of the existing notes, the injection of $5 million of cash and the repayment of the BBY
         facility with shares ahead of a further $12.5 million due at the end of February, places the Company on
         a firm financial footing" said Mr Knox. "Achieving First Completion is an important step in capitalising
         the Company and funding the finalisation of the Bankable Feasibility Study for the Company's flagship
         Waterberg Coal Joint Venture Project."


          Yours sincerely,



         David Knox
         Chief Executive Officer
         www.firestoneenergy.com.au
         Tel: Australia (+61 08 9287 4600)
              South Africa (+27 11 706 3548)




         5 February 2013
         Sponsor
         River Group

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