Xcite Energy Limited ("Xcite Energy" or the "Company") - Private Placement of 30,000,000 Units

/NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION/

TSX-V, LSE-AIM: XEL

TORONTO, June 13, 2012 /CNW/ - Xcite Energy announces that it has agreed a private placement of 30,000,000 units (the "Placing") with Global Resource Funding Partners LLC ("Global Resource"), based in Boston Massachusetts.

The financing made available from the Placing will further strengthen the Company's balance sheet at an important time in the development of the Bentley field.

In addition, the private placement provides for a subscription of further units by Global Resource by mutual agreement of the parties.

Rupert Cole, Chief Financial Officer, commented:

"We are very pleased to welcome Global Resource as a shareholder at this important time for the Company. Against a backdrop of challenging economic and market conditions, this further strengthens our balance sheet and provides important flexibility as we move ahead with the field development work programme towards first oil on Bentley."

The Placing

The Placing will occur in three stages. The first stage, which closed today, provides the Company with gross proceeds of £6.43 million (C$10.28 million) through the issuance of 8,000,000 units (each, a "Unit") at a price of £0.8044 per Unit.

Each Unit in the first tranche comprises one ordinary share in the capital of the Company (a "Share") and one-half of one ordinary share purchase warrant (a "Warrant"). Each whole Warrant issued pursuant to the first tranche of the Placing is exercisable for one additional Share at 120% of the Unit price per share for three years from the date of issue. The exercise price of the Warrants issued in the first stage of the Placing is approximately £0.97.

The completion of the second and third stages of the Placing, which will comprise 10,000,000 Units and 12,000,000 Units respectively, will be completed at any time between 20 and 55 business days from the date of this first stage.

The price per Unit of the second and third stages of the Placing will be equal to a 10% discount to the average of the ten daily volume weighted average prices ("VWAP") of the Shares on the AIM market of London Stock Exchange plc ("AIM") ending two trading days prior to the closing of the second and third stage, respectively, and subject to the private placement pricing parameters of the TSX Venture Exchange (the "TSX-V"). In the event the TSX-V policies on Discounted Market Price affect the pricing of any tranche of the Placing, the parties have agreed a mechanism by which the value of subsequent tranches can be adjusted.

The Warrants are subject to a forced exercise provision at the Company's option, provided:

(i)     the VWAP per Share on AIM for 15 consecutive trading days on average is greater than 170% of the applicable exercise price, and;

(ii)     the average daily trading volume of the Shares on AIM during such 15 consecutive trading days is greater than 1,000,000 Shares per day.

If such criteria are met, the Company may require Global Resource to exercise the Warrants within 10 business days from the date of such notice or the Warrants will lapse.

Additional Information

Octagon Capital Corporation ("Octagon") acted as advisor to the Company with respect to the Placing. A fee in the amount of 4.5% of the gross proceeds of each stage of the Placing is payable by the Company to Octagon at closing of each of the respective stages of the Placing.

The closing of each stage of the Placing is subject to final acceptance from the TSX-V. Except in accordance with Canadian securities laws and with the prior written approval of the TSX-V, the Shares underlying the Units and the Shares issuable upon exercise of the Warrants may not be sold or otherwise traded on or through the facilities of the TSX-V or otherwise in Canada or to or for the benefit of a Canadian resident until the date that is four months and one day from the date of issue.

Application has been made for admission to AIM of the 8,000,000 Shares underlying the Units issued in the first stage of the Placing ("Admission"), and dealings are expected to commence on 14 June 2012. The Shares shall rank pari passu in all respects with the Company's existing issued ordinary shares of no par value. At Admission, Global Resource will hold 3.13% of the Company's current issued share capital, together with 4,000,000 warrants.

Total Voting Rights

Following Admission, the Company's enlarged issued share capital will comprise 255,693,630 Shares with one voting right per share. There are no shares held in treasury. The total number of voting rights in the Company is therefore 255,693,630. At Admission there will be a total of 11,947,647 outstanding warrants to subscribe for Shares.

This figure of 255,693,630 Shares may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the Financial Service Authority's Disclosure and Transparency Rules.

This press release shall not constitute an offer for sale of the securities referenced herein in the United States. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an exemption from those registration requirements.

Neither the 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.

Forward-Looking Statements 

Certain statements contained in this announcement constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to the Company's future outlook and anticipated events or results and, in some cases, can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "target", "potential", "continue" or other similar expressions concerning matters that are not historical facts. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities. While the Company considers these assumptions to be reasonable based on information currently available to us, they may prove to be incorrect. Forward-looking information is also subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what we currently expect. These factors include risks associated with the oil and gas industry (including operational risks in exploration and development and uncertainties of estimates oil and gas potential properties), the risk of commodity price and foreign exchange rate fluctuations and the ability of Xcite Energy to secure financing. Additional information identifying risks and uncertainties are contained in the Company's annual information form dated October 26, 2010 and in the interim Management's Discussion and Analysis for Xcite Energy for the three months ended 31 March 2012 filed with the Canadian securities regulatory authorities and available at www.sedar.com. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.

SOURCE Xcite Energy Limited

For further information:

ENQUIRIES:

Xcite Energy Limited 
+44 (0) 1483 549 063

Richard Smith
Chief Executive Officer

Rupert Cole
Chief Financial Officer

Oriel Securities (Joint Broker and Nomad)
+44 (0) 207 710 7600

Emma Griffin
Partner

Michael Shaw
Partner

Morgan Stanley (Joint Broker)
+44 (0) 207 425 8000

Andrew Foster
Managing Director

Pelham Bell Pottinger
 +44 (0) 207 861 3232

Mark Antelme
Director

Henry Lerwill
Account Director

Paradox Public Relations
+1 514 341 0408

Jean-Francois Meilleur
Consultant

Global Resource Funding Partners LLC
+1 617 778 7759

Yossi Raucher
Director

Profil de l'entreprise

Xcite Energy Limited

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