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8-K - FORM 8-K - SYNTHESIS ENERGY SYSTEMS INC | c21571e8vk.htm |
EX-10.2 - EX-10.2 - SYNTHESIS ENERGY SYSTEMS INC | c21571exv10w2.htm |
Exhibit 99.1
P R E S S R E L E A S E
Synthesis Energy Systems and China Energy Announce
Extension of Agreement for $83.8 Million Equity Investment
Extension of Agreement for $83.8 Million Equity Investment
Move Provides Time to Include Strategic Commercialization Partners
Houston, Texas August 16, 2011 Synthesis Energy Systems, Inc. (NASDAQ: SYMX) (SES), a
global energy and gasification technology company that provides products and solutions to the
energy and chemicals industries, announced today that it has agreed with Zhongjixuan Investment
Management Company Ltd. (ZJX) and China Energy Industry Holding Group Co., Limited (China
Energy) to extend the closing period of their March 31, 2011 share purchase agreement through
December 31, 2011. ZJX/China Energy recently notified SES of its intent to complete the investment
into SES in partnership with Yima Coal Industry Group Co., Ltd. (Yima) and requested the
extension in order to allow China Energy and YIMA sufficient time to complete the required Chinese
governmental approvals.
Yima is a Chinese state-owned enterprise with operating revenue in 2010 of approximately US$3.0
billion. Yima has recently taken part of its coal business public on the Shanghai Stock Exchange
via the listing of Da You Energy (600403:Shanghai), which is 85% owned by Yima. Da You has a market
capitalization of approximately US$4.5 billion.
SES is currently partnered with Yima on a coal chemical project in Henan Province, China, which is
in the advanced stages of construction. This project is the first phase of a planned multi-project
industrial park with total investment of approximately US$4.0 billion.
Our collaboration with China Energy has drawn the interest of important Chinese companies such as
Yima that have plans to build new, large scale coal-to-natural gas, chemicals, and energy projects
in China, stated Robert Rigdon, President and CEO of SES. Through this partnership with Yima,
ZJX/China Energy is further strengthening its capability, which will be helpful to SES in terms of
accelerating its growth in China through connecting low quality coal resources into near term
projects. We therefore believe it is prudent to extend the agreement to allow the related
governmental approval steps to be completed.
Feng Feng, Managing Chairman of China Energy, stated, We believe in the potential to significantly
improve our cooperation with SES by partnering with Yima to complete the investment into SES. Yima
is a well-established company in Chinas coal industry that also has coal to chemicals and energy
projects operating and under construction, with plans to build new, large-scale projects in the
near future. We see Yima as a particularly strong strategic and financial partner due to its access
to capital and its plans for aggressively growing its coal and coal-to-gas and chemicals
businesses. We appreciate the efforts made by SES in working with us to engage strong strategic
partners that can provide additional resources along with operational expertise and large scale investment projects.
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This transaction remains subject to shareholder approval as well as customary closing conditions.
Full details of the transaction are available in an 8-K filed with the Securities and Exchange
Commission on March 31, 2011.
About Synthesis Energy Systems, Inc.
SES provides technology, equipment and engineering services for the conversion of low rank, low
cost coal and biomass feedstocks into energy and chemical products. Its strategy is to create
value through providing technology and equipment in regions where low rank coals and biomass
feedstocks can be profitably converted into high value products through its proprietary
U-GAS® fluidized bed gasification technology, which SES licenses from the Gas Technology
Institute. U-GAS® gasifies coal cost effectively, without many of the harmful emissions
normally associated with coal combustion plants. The primary advantages of U-GAS®
relative to other gasification technologies are (a) greater fuel flexibility provided by the
ability of SES to use all ranks of coal (including low rank, high ash and high moisture coals,
which are significantly cheaper than higher grade coals), many coal waste products and biomass feed
stocks; and (b) the ability of SES to operate efficiently on a smaller scale, which enables the
construction of plants more quickly, at a lower capital cost, and, in many cases, in closer
proximity to coal sources. SES currently has offices in Houston, Texas, and Shanghai, China. For
more information on SES, visit www.synthesisenergy.com or call (713) 579-0600.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements other than statements of historical fact are forward-looking statements.
Forward-looking statements are subject to certain risks, trends and uncertainties that could cause
actual results to differ materially from those projected. Among those risks, trends and
uncertainties are the early stage of development of SES, its estimate of the sufficiency of
existing capital sources, its ability to successfully develop its licensing business, its ability
to raise additional capital to fund cash requirements for future investments and operations, its
ability to reduce operating costs, the limited history and viability of its technology, the effect
of the current international financial crisis on its business, commodity prices and the
availability and terms of financing opportunities, its results of operations in foreign countries
and its ability to diversify, its ability to maintain production from its first plant in the ZZ
joint venture, its ability to complete the expansion of the ZZ project, its ability to obtain the
necessary approvals and permits for its Yima project and other future projects, the estimated
timetables for achieving mechanical completion and commencing commercial operations for the Yima
project, its ability to negotiate the terms of the conversion of the Yima project from methanol to
glycol, the sufficiency of internal controls and procedures and the ability of SES to grow its
business as a result of the ZJX and Zuari transactions as well as its joint venture with Midas
Resource Partners. Although SES believes that in making such forward-looking statements its
expectations are based upon reasonable assumptions, such statements may be influenced by factors
that could cause actual outcomes and results to be materially different from those projected. SES
cannot assure you that the assumptions upon which these statements are based will prove to have been correct.
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Important Notice
In connection with the proposed transaction, SES has filed a preliminary proxy statement, and
intends to files a definitive proxy statement, with the SEC and intends to mail the definitive
proxy statement to the stockholders of SES. SES and its directors and officers may be deemed to be
participants in the solicitation of proxies from the stockholders of SES in connection with the
transaction. Information about the transaction is set forth in the preliminary proxy statement
filed, and will be set forth in the definitive proxy statement to be filed by SES with the SEC.
When available, you may obtain the preliminary and definitive proxy statements for free by visiting
EDGAR on the SEC website at www.sec.gov. Investors should read the definitive proxy statement
carefully before making any voting or investment decision because that document will contain
important information.
# # #
Contact:
Synthesis Energy Systems, Inc.
Kevin Kelly
Chief Accounting Officer
(713) 579-0600
Kevin.Kelly@synthesisenergy.com
Kevin Kelly
Chief Accounting Officer
(713) 579-0600
Kevin.Kelly@synthesisenergy.com
MBS Value Partners, LLC
Matthew D. Haines
Managing Director
(212) 710-9686
Matt.Haines@mbsvalue.com
Matthew D. Haines
Managing Director
(212) 710-9686
Matt.Haines@mbsvalue.com
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