Asia Energy Logistics : Announcements and Notices - Conversion of the Tranche 2 Notes

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This announcement is for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of the Company.

ASIA ENERGY LOGISTICS GROUP LIMITED

亞 洲 能 源 物 流 集 團 有 限 公 司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 351) CONVERSION OF THE TRANCHE 2 NOTES

On 25 July 2016, the Company received a conversion notice from the Subscriber in respect of the exercise of the Conversion Rights attached to the Tranche 2 Notes in the aggregate amount of HK$1,000,000 held by the Subscriber at the Conversion Price of HK$0.0397 per Conversion Share, which is the Floating Conversion Price and equals to 80% of the average of the closing price per Share on three consecutive Business Days from 28 June 2016 to 30 June 2016 of HK$0.050. As a result of this conversion, the Company allotted and issued the Tranche 2 Conversion Shares to the Subscriber on 26 July 2016.

CONVERSION OF THE TRANCHE 2 NOTES

Reference is made to the circular of the Company dated 11 April 2016 (the "Circular") and the announcement of the Company dated 1 March 2016, 3 May 2016, 10 May 2016, 23 June 2016 and 19 July 2016 (the "Announcements") in relation to the issue and conversion of the Tranche 2 Notes. Capitalised terms used in this announcement shall have the same meanings as those defined in the Circular and the Announcements unless otherwise stated herein.

On 25 July 2016, the Company received a conversion notice from the Subscriber in respect of the exercise of the Conversion Rights attached to the Tranche 2 Notes in the aggregate amount of HK$1,000,000 held by the Subscriber at the Conversion Price of HK$0.0397 per Conversion Share, which is the Floating Conversion Price and equals to 80% of the average of the closing price per Share on three consecutive Business Days from 28 June 2016 to 30 June 2016 of HK$0.050. As a result of this conversion, the Company allotted and issued a total of 25,188,916 Conversion Shares (the "Tranche 2 Conversion Shares") to the Subscriber on 26 July 2016.

As disclosed in the Circular, the Conversion Price shall be the greater of the 50% of the Closing Price, which is HK$0.0265 per Conversion Share and is calculated based on 50% of the closing price for the Business Day immediately preceding the Conversion Date on which the Shares were trades on the Stock Exchange, or the Floating Conversion Price, which is 80% of the average of the closing prices per Share on any three consecutive Business Days as selected by the relevant Noteholder during the 45 Business Days immediately preceding the relevant Conversion Date on which Shares were traded on the Stock Exchange.

The Tranche 2 Conversion Shares will rank pari passu with all the existing Shares at the date of allotment and among themselves in all respects. The issued share capital of the Company will be increased to 14,221,998,958 Shares upon allotment and issue of the Tranche 2 Conversion Shares and the Tranche 2 Conversion Shares represent approximately 0.1774% of the issued share capital of the Company immediately before the allotment and issue of the Tranche 2 Conversion Shares and approximately 0.1771% of the issued share capital of the Company as enlarged by the allotment and issue of the Tranche 2 Conversion Shares.

By order of the Board

Asia Energy Logistics Group Limited Liang Jun

Executive Director

26 July 2016

As at the date of this announcement, the executive directors of the Company are Mr. Liang Jun, Mr. Fung Ka Keung, David, Ms. Yu Sau Lai, Mr. Tse On Kin, Mr. Fu Yong Yuan and Mr. Lin Wenqing; the non-executive directors of the Company are Mr. Yu Baodong (Chairman) and Ms. Sun Wei; and the independent non-executive directors of the Company are Mr. Chan Chi Yuen and Professor Sit Fung Shuen, Victor.