TARGET ENERGY LIMITED 27 April 2014
Partially Underwritten Rights Issue Corporate information Renounceable pro‐rata entitlement issue to raise up to approximately
$5.0m, with approximately $2.9m of underwriting secured Directors to sub‐underwrite approximately $1.3 million of the entitlement issue and further $1.4 million of commitments have been received from shareholders
Target's major shareholder, Wyllie Group Limited, has committed to participate for its full entitlement $0.45m.
Rights issue priced at a 68% discount to 30 day volume weighted average price1 with one free listed option for every two shares issued to encourage shareholder participation Divestment of the West Texas Fairway Project is still planned however
Target will seek to sell into a stronger market Fairway oil and gas production remains operating cash flow positive at current oil prices2
Target continues to hold a large working interest in 4,483 acres in the most coveted and prolific hydrocarbon basin in the United States with multiple, thick, oil bearing horizons
US‐focused oil and gas producer, Target Energy Limited (Target), advises that it is undertaking a renounceable pro‐rata entitlement issue (Entitlement Issue) to raise up to approximately A$5m.
Eligible shareholders will be able to subscribe for 5 new fully paid ordinary shares in Target (Shares) for every 3 existing Shares they hold at the Record Date (as set out in the timetable below) at an issue price of A$0.006 per share, together with one free attaching option to acquire a Share for every two Shares issued (New Option). The New Options will have an exercise price of $0.012 and an expiry date of 28 February 2017.
Patersons Securities Limited (Patersons) has agreed to underwrite the first
$2.9m raised under the Entitlement Issue. Directors have agreed to convert their existing loans into Shares and New Options as part of the Entitlement Issue, thereby retiring over $640,000 in company debt.
1Shares in Target Energy Limited have not traded since 31 March 2015 due to a trading halt and voluntary suspension. The volume weighted average price is calculated on the 30 trading days to 31 March 2015. The last traded price on the 31 March was $0.013.
2 Operating cash flows defined as net revenues (after royalties) less field operating costs. Does not
include general and administration costs. Current WTI benchmark oil prices are US$56/bbl.
ASX Code: TEX
OTCQX Code: TEXQY
Board of Directors Chris Rowe, Chairman Laurence Roe, Managing Director
Stephen Mann, Director
Ralph Kehle, Chairman TELA (USA)
Rowan Caren, Company Secretary
ABN
73 119 160 360
Contact details
6 Richardson St, Suite 5
West Perth WA 6005
Tel: +61 8 9476 9000
1900 St James Place, Suite 425
Houston Tx 77056
USA
Tel: +1 713 275 9800
E: admin@targetenergy.com.au
W: www.targetenergy.com.au
Media Inquiries: Australia
Ross Dinsdale
Business Development Manager
(Perth)
+61 429 702 970
ross.dinsdale@targetenergy.com.au
USA
Laurence Roe
Target Houston
+1 303 319 4920 cell
+1 713 275 9800 direct
Laurence.roe@targetenergyusa.com
TARGET ENERGY LIMITED Address 6 Richardson St (Suite 5), West Perth WA 6005
Mailing Address PO Box 140 West Perth WA 6872 ABN 73 119 160 360 | Ph +618 9476 9000
Fax +618 9476 9099 | email admin@targetenergy.com.au | www.targetenergy.com.au
ASX Announcement27 April 2014
Funds raised from the Entitlement Issue will be used to address payables, provide working capital and to potentially allow the Company to undertake an asset optimisation program.
For more details on the Entitlement Issue please refer to the table of key dates to follow and the Entitlement Issue prospectus which will be despatched to eligible shareholders in accordance with the proposed timetable.
Target's Managing Director, Laurence Roe commented, "We originally invested in the Fairway asset because of the excellent geology and access to infrastructure in the Permian Basin. We committed a significant amount of the Company's resources in the development of Fairway to grow production, cash flows and reserves but also to position the Fairway asset for a divestment."
"Earlier this year Target and its partners made the decision to defer the divestment until oil prices recover or until such time as we receive a suitable offer. It is our belief that commodity prices are beginning to recover and if that recovery continues, we should have a better market in which to sell the Fairway asset."
"In the meantime, we are pleased to have secured a solid underwriting from which to launch this Entitlement Issue and I wish to thank our underwriter, a number of our Top 20 shareholders and my fellow directors and staff for their strong support."
ENDS
For and on behalf of TARGET ENERGY LIMITED
Managing Director
TARGET ENERGY LIMITED Address 6 Richardson St (Suite 5), West Perth WA 6005
Mailing Address PO Box 140 West Perth WA 6872 ABN 73 119 160 360 | Ph +618 9476 9000
Fax +618 9476 9099 | email admin@targetenergy.com.au | www.targetenergy.com.au
ASX Announcement27 April 2014
Key Dates for Entitlement Issue Event DateLodgement of Prospectus with the ASIC 24 April 2015
Lodgement of Prospectus & Appendix 3B with ASX 24 April 2015
Notice sent to Shareholders 28 April 2015
Ex date 29 April 2015
Rights start trading 29 April 2015
Record Date for determining Entitlements 1 May 2015
Prospectus sent out to Shareholders & Company announces this
has been completed
6 May 2015
Rights stop trading 8 May 2015
Shares and New Options quoted on a deferred settlement basis 11 May 2015
Last day to extend the Offer* 12 May 2015
Closing Date 15 May 2015
ASX notified of under subscriptions 19 May 2015
Issue date/Shares and New Options entered into Shareholders'
security holdings
21 May 2015
Quotation of Shares and New Options issued under the Offer* 22 May 2015
* This timetable is indicative only and may be subject to change. The Directors can extend the Closing Date by giving at least 3 Business Days notice to ASX prior to the Closing Date.
TARGET ENERGY LIMITED Address 6 Richardson St (Suite 5), West Perth WA 6005
Mailing Address PO Box 140 West Perth WA 6872 ABN 73 119 160 360 | Ph +618 9476 9000
Fax +618 9476 9099 | email admin@targetenergy.com.au | www.targetenergy.com.au
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