SSP Offshore Announces (i) Non-Brokered Private Placement and (ii)
Finalization of Regional Joint Venture for Southeast Asia
HOUSTON, TX,
Jan. 14, 2013 /CNW/ - SSP Offshore
Inc. ("SSP Offshore") announces that it has entered into: (i) a
definitive subscription agreement to complete a non-brokered
private placement with Huludao Jiangzhe Marine & Offshore
Equipment Co., Ltd. ("HJZ"), a private company based in
China with experience in
developing infrastructure projects in the offshore oil & gas
industry; and (ii) a series of agreements with HJZ establishing a
regional joint venture in Southeast
Asia to focus on the commercialization of SSP Offshore's
proprietary floating platform technology in that region.
(i) Private Placement- Under the terms of the
subscription agreement, HJZ is acquiring 7,125,000 treasury common
shares of SSP Offshore at a price of $0.21 US per share for total subscription
proceeds of $1,496,250 US.
There are no warrants or special rights attached to the common
shares being issued to HJZ. After completion of the private
placement, HJZ will own 9.99% of the outstanding common shares of
SSP.
Proceeds of the private placement will be used
for general working capital purposes to fund the ongoing execution
of SSP Offshore's business plan internationally. SSP Offshore
intends to close the private placement forthwith and file
supporting materials with the TSXV as an expedited private
placement in accordance with TSXV Policy 4.1.
(ii) SSP Asia Regional Joint Venture- SSP
Offshore and HJZ have established a new joint venture entity,
SSP_Asia Pte Ltd. ("SSP Asia"), which is incorporated and
headquartered in Singapore.
The equity of SSP Asia will be owned 51% by HJZ and 49% by SSP
Offshore Ltd., a wholly-owned subsidiary of SSP Offshore.
SSP Technologies Inc. ("SSP Technologies"),
another wholly-owned subsidiary of SSP that holds all technology
rights in the SSP group, has granted an exclusive Asian Master
Regional License (the "Asia
License") to SSP Asia relating to the SSP floating platform
technology in the geographic region which includes the territorial
waters of China and other
countries of Southeast Asia.
Under the terms of the Asia License, SSP
Technologies has received an upfront license payment from HJZ in
the amount of $1,000,000 US and will
be entitled to a further $1,000,000
license payment at the time that SSP Asia receives a letter of
intent for its first SSP unit and an additional $1,000,000 license payment at the time that SSP
Asia receives a definitive contract for its first SSP unit.
Beyond the cumulative $3,000,000
license payments to be funded by HJZ, SSP Technologies will also
receive a royalty payment payable from SSP Asia equal to 1.5% of
the "hull value" (as defined in the Asia License) for each project
undertaken by SSP Asia using the SSP Offshore technology.
Under the terms of the unanimous shareholders
agreement relating to SSP Asia, HJZ is also responsible for
contributing the first $3,000,000 US
in working capital to SSP Asia to fund commercialization
efforts. Of this amount, an initial $1,000,000 amount has been received upfront from
HJZ and the remaining $2,000,000 will
be funded by HJZ to SSP Asia on an "as needed" basis in the
future. Beyond the first $3,000,000 working capital commitment from HJZ,
further working capital requirements of SSP Asia will be
contributed pro rata by the shareholders.
SSP Offshore Ltd. is acquiring its 49% equity
interest in SSP Asia for nominal cash consideration based on the
inherent value attributed by the parties to the Asia License issued
by SSP Technologies.
Paul Illingworth,
CEO of SSP Offshore commented that "we believe that finalization of
the SSP Asia joint venture demonstrates another significant step
forward for our company. The $6,000,000 US cash committed by HJZ to acquire
their 51% interest in the SSP Asia joint venture, along with the
additional funds HJZ is investing at the parent company level
through the private placement, certainly represents a significant
vote of confidence in the commercial potential of the SSP floating
platform technology in the Chinese and Southeast Asian
markets. We look forward to working together with HJZ to
secure contracts for SSP projects in this region."
William Zhu,
director of HJZ, stated that "we are very pleased to have been
selected by SSP as their partner for the SSP Asia joint
venture. We look forward to combining the technical expertise
and commercial contacts of our respective teams to maximize our
effectiveness in bringing the exciting SSP floating platform
designs to this market."
About SSP Offshore Inc.
SSP Offshore is a public company listed under
the symbol "SSZ" on the TSX Venture Exchange. SSP Offshore is
actively commercializing its proprietary SSP® FPSO platform design
in two formats: (i) SSP Base; and (ii) SSP Plus. Visit the
company's website at www.sspoffshore.com for more information.
Neither the TSX Venture Exchange nor its
Regulatory 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.
Certain elements of this press release may
contain forward-looking statements and include reference to
managements' current expectation or belief in anticipated future
events. Investors are cautioned that any forward looking
statements are subject to known and unknown risks and
uncertainties, which may cause actual results to differ materially
therefrom.
SOURCE SSP Offshore Inc.