Westmount Engy. Regulatory News (WTE)

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

This announcement does not constitute an offer to sell or the solicitation of an offer to buy any securities of the Company and for the avoidance of doubt this announcement is not an offer and not capable of being accepted.

24 October 2018

WESTMOUNT ENERGY LIMITED

("Westmount" or the "Company")

Convertible Loan Notes due 2021

Director/PDMR Shareholding

The Board of Westmount is pleased to announce that the Company has raised £1,600,000, from three existing significant shareholders of the Company, including Mr Gerard Walsh (Chairman), through the issue of £1,600,000 principal of 10% convertible unsecured loan notes due 2021 ("Convertible Loan Notes"). The Company also announces that it may issue additional Convertible Loan Notes up to a further £3,400,000 by invitation to a restricted circle of existing shareholders and other potential investors (the "Subscription") as £5,000,000 principal of Convertible Loan Notes have been created pursuant to a loan note instrument executed by the Company on 24 October 2018 (the "Loan Note Instrument").

The net proceeds of the issuance of Convertible Loan Notes will be used to pursue Westmount's ongoing investment strategy, as well as for general corporate purposes.

Principal terms of the Convertible Loan Notes

The principal terms of the Convertible Loan Notes are as follows:-

(a) the Convertible Loan Notes are repayable at their full nominal value on 31 March 2021, unless the Company elects to repay (by issue of an "Early Repayment Notice"), in whole or in part, the Convertible Loan Notes at their full nominal value at any earlier time and without penalty, by giving not less than 20 days' notice thereof to the holders of the Convertible Loan Notes (the "Noteholders") or such notice period as the Company and the relevant holder may agree;

(b) the Convertible Loan Notes will become repayable immediately (together with interest accrued thereon) upon certain events of default occurring in relation to the Company (including for this purpose, a takeover offer for the Company becoming or being declared wholly unconditional);

(c) interest, which is aggregated on a daily basis, is payable on the Convertible Loan Notes at the rate of 10 per cent. per annum; payable in arrears on 31 October 2019, 31 October 2020 and pro-rata at repayment date.;

(d) a Noteholder has the right at any time from 31 October 2020 up until the final repayment date upon giving not less than 3 calendar months' prior written notice to the Company ("Noteholder Loan Note Conversion Notice"), to convert the principal amount of the Convertible Loan Notes held (plus any accrued interest post the 31 October 2020) into new ordinary shares of nil par value in the Company ("Ordinary Shares") at an amount per share equal to the higher of £0.08 per share and a 25% discount to the volume weighted average price ("VWAP") of the Ordinary Shares as reported by Bloomberg for the 5 trading days immediately prior to the date that the conversion notice becomes effective (the "Noteholder Conversion Price"), provided that an Early Repayment Notice has not been issued by the Company in advance.

(e) the Company has the right, upon giving not less than 5 days' prior written notice to a Noteholder, to convert the interest payable on the 31 October 2019 into new Ordinary Shares at a 10% discount to the VWAP of the Ordinary Shares as reported by Bloomberg for the 5 trading days immediately prior to that interest payment date (the "Company Conversion Price") with any such conversion effective on that interest payment date;

(f) a Noteholder also has the right upon giving not less than 3 calendar months' prior written notice to the Company, to convert the interest payable on the 31 October 2020 into new Ordinary Shares at the Noteholder Conversion Price (with any such conversion effective on that interest payment date);

(g) the conversion rights under the Convertible Loan Notes may be subject to adjustment as the Company's auditors, nominated adviser or broker (as appointed by the Board for that purpose) thinks fit in the event of specific corporate actions affecting the share capital of the Company after conversion notices have been issued;

(h) the Convertible Loan Notes registered in a Noteholder's name will be evidenced by a Convertible Loan Note certificate issued by the Company (and will not be issued in uncertificated form);

(i) the Convertible Loan Notes are not transferable;

(j) the Convertible Loan Notes will not be listed on AIM or any other stock exchange;

(k) Ordinary Shares issued on the exercise of conversion rights in respect of the principal of, or interest on, the Convertible Loan Notes will be issued in certificated form or uncertificated form (at the election of the Noteholder (in the notice exercising the relevant conversion rights or as provided to the Company); and

(l) following conversion of any Convertible Loan Notes the Company shall, within 3 business days after the effecive date of the relevant conversion, allot and issue the new Ordinary Shares to be issued upon such conversion and, provided the Ordinary Shares are traded on AIM (or any other stock exchange), make an application for the new Ordinary Shares to be admitted to trading on AIM (or that other stock exchange).

The Subscription

Letters of invitation to subscribe are being sent to a restricted circle of shareholders and other prospective investors, providing further detail on the Subscription and the application process. The Company expects to complete the Subscription by 15 November 2018, following which it will announce the total amount raised. The Company may, at its discretion, extend this deadline, albeit to no later than 30 November 2018.

The availability of the Subscription has been limited in order to avoid the requirement to publish a prospectus in accordance with Jersey and UK prospectus legislation. Such action has been taken to avoid substantial costs for the Company and the requirement for significant management resource in the short to mid-term, that the Directors believe would be a hindrance to implementing Westmount's strategy.

Convertible Loan Notes may only be subscribed for, and will only be issued by the Company, in multiples of £5,000 principal.

Under the terms of the Subscription, subscribers will undertake not to dispose of any Ordinary Shares issued on conversion of the Convertible Loan Notes for a period of 3 months following the date of such issue.

Related Party Transactions

Hargreave Hale Limited ("Hargreave Hale"), which controls approximately 15.2 per cent of the Company's existing issued ordinary share capital, and Mr Gerard Walsh (Chairman) are deemed to be related parties pursuant to Rule 13 of the AIM Rules for Companies. Hargreave Hale and Mr Walsh have subscribed for Convertible Loan Notes with a value of £1,000,000 and £500,000 respectively, which therefore each constitute Related Party transactions.

The independent directors of the Company (namely Thomas O'Gorman, Dermot Corcoran and David King) consider, having consulted with Cenkos Securities plc, the Company's nominated adviser, that the terms of the issue of Convertible Loan Notes to Hargreave Hale and Mr Walsh are fair and reasonable insofar as the Company's shareholders are concerned.

Director's Loan Repayment

Further to the Company's announcement dated 28 August 2018, the Company gives notification that the interest-free loan made by Mr Gerard Walsh to the Company for £200,000, has been settled through the issue of £200,000 principal of Convertible Loan Notes. The balance of £300,000 principal of Convertible Loan Notes has been paid for by Mr Walsh in cash.

For further information, please contact:

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