KAL ENERGY INC

On April 12, 2010 KAL, Thatcher, PT Kubar and Kangaroo Resources (KRL) replaced the September 2009 $5 million exit deal with a new Cooperation Agreement. KRL pays KAL $850,000 and assigns KAL an 8% free-carried economic interest in Graha (GPK), and gets a call option, exercisable 12 months from the agreement, to buy KAL's interest for another $4 million. KAL also releases and indemnifies the other parties over existing agreements. The filing says the original release was dropped because of unavailable parties, administrative difficulty and deteriorating understanding, and that KRL had been delaying payments over doubts about the signatories. KAL keeps a reduced stake rather than receiving the full $5 million.

material agreement

On September 29, 2009 KAL and Thatcher agreed to give up all claims to the Graha (GPK) coal concession, ending the January 2007 agreement that gave them its economic rights, in exchange for US$5,000,000 from Kangaroo Resources Ltd (KRL), payable as $100,000, $2.4 million and $2.5 million over about 60 days (extendable for penalty fees). KAL cites funding shortages, legal costs and uncertainties such as third-party claims and a delayed licence extension, and plans to use the proceeds to pay some debts and pursue other opportunities. This would end the Graha project that the company had been developing, and a sale would trigger repayment of the HH&P loan under its terms (inference).

asset acquisition disposition

On April 14, 2009 KAL's subsidiary PT Kubar Resources borrowed $400,000 from its former Indonesian law firm Hadiputranto, Hadinoto & Partners (HH&P), guaranteed by KAL, at 5% interest. In a separate settlement, about $134,000 of legal fees owed to HH&P is deferred and released claims against the firm. The loan and fees fall due within five days of KAL raising $4,000,000 in funding or selling any interest in an Indonesian mining project. This is KAL's first disclosed debt facility, and it creates a repayment trigger tied to any sale of its mining interests.

debt financing

Starting February 24, 2009, KAL privately placed a total of 24 million shares at $0.01 each, with chairman and CEO William Bloking taking $140,000 worth and another investor the rest, for $240,000 gross. On February 27 it also settled about $265,000 of debts owed to a group of individuals, including $156,000 to Bloking and $60,000 to Andrew Caminschi (described as CFO), by issuing about 22.1 million shares at $0.012. Together this issues roughly 46 million new shares at very low prices, which dilutes existing holders. It follows the $60,000 Bloking purchase in February; the subscription form says proceeds are for working capital and paying down debt.

capital raising announcement

On February 24, 2009 Indo decided not to proceed from the January letter of intent to a final joint venture, which ended the LOI. Indo paid a total of $25,000 and earned no interest in KAL's projects. Indo cited technical compliance issues with the Graha licences that it believed might not be resolved in time; KAL management disagrees and says it is now pursuing alternate strategic relationships. This ends the proposed 70/30 deal and the US$1.3 million payment plan.

material agreement termination

On January 20, 2009 the company and Thatcher Mining signed a non-final letter of intent with Indo Mines and Indo Energy for a joint venture on the Graha concession, with Indo at 70% and KAL at 30%. Indo would pay all exploration, feasibility and development costs until a decision to mine, and pay KAL US$1.3 million in total, but only if due diligence is satisfactorily completed. This is a new proposed partner and is not yet a binding joint venture.

material agreement

A new resource statement (announced December 1, 2008) for the Graha concession (Block 24) raises the estimated coal resource to 248 million tonnes from 204 million. 141 million tonnes are now rated indicated and 107 million tonnes inferred. Resources are not reserves; the company plans Phase II drilling once it gets its exploration licence extension and a Forestry Department permit, and aims to apply for an exploitation licence by year-end, hoping to receive it by end of May 2009. The company address is now Jakarta.

resource reserve update

On September 17, 2008 four stockholders agreed to return 9,000,000 shares to the company, which holds them as treasury stock to reissue only to attract and retain directors, executives and staff. The press release says outstanding shares fall from 143,416,171 to 134,416,171 and describes the move as avoiding further dilution; the fully diluted count stays at 153,294,505. It also says 13.6 million shares/options are available for incentives, and that the company is searching for a new CEO. This follows the 2007 option pool thread.

material agreement

On June 27, 2008 the company settled a dispute with the three investors from the June 2007 financing by restating the deal: the price fell from $0.80 to $0.15 per share and 4,062,500 extra shares were issued, for 5,000,000 shares in total. The never-issued 937,500 warrants at $1.428 were cancelled, and gross proceeds stay at about $750,000. For shareholders this means more shares outstanding for the same money; the company also must file a Form SB-2 to register these shares for resale, which continues that open thread.

capital raising announcement

The March 2008 placement closed on June 17, 2008 at a much smaller size. One investor who had subscribed for 26,666,667 shares (about $4,000,000) had paid only $700,000 and could not pay the remaining $3,300,000 by June 13, so its subscription was cut to 4,666,667 shares. The offering fell from 60,686,732 to 38,686,732 shares, and gross proceeds from about $9.1 million to about $5.8 million. This resolves the March 2008 financing thread, and the company's address is now Singapore.

material agreement

On March 12, 2008 the company agreed to sell 60,686,732 shares at $0.15 each to 24 investors for gross proceeds of about $9.1 million, closing on a rolling basis through March 31, 2008. The price is far below the $0.80 paid in the June 2007 placement, and the share count is large compared with the roughly 97.6 million shares outstanding after the Thatcher deal, so existing holders face significant dilution (inference). Martin Hurley now signs as CEO.

capital raising announcement

The Thatcher Mining deal closed on February 9, 2007, resolving the December 2006 agreement. Thatcher, which holds rights to two coal concessions in Indonesia, is now a wholly-owned subsidiary and the company's sole intended line of business. The company issued 32,000,000 shares to Thatcher's holders and raised $3,523,000 in a private placement of 17,315,000 shares, leaving 97,602,772 shares outstanding, so earlier shareholders now hold about 48%. The company says it is still at the exploration stage with no assurance of commercially viable coal, and it moved its offices to London. Laith Reynolds and Andrew Caminschi joined the board alongside Strato Malamas, with Reynolds as Chairman. Loans to Thatcher, which reached $615,000 including a further $425,000, were cancelled at closing.

business combination

The company (formerly Patriarch, Inc.), now named KAL Energy, agreed on December 29, 2006 to buy Singapore-based Thatcher Mining by issuing 32,000,000 of its shares to Thatcher's shareholders, paying them $10,000 and a royalty of $0.40 per metric ton of coal sold. Closing was expected around January 23, 2007. Existing shareholders would hold about 46.9 million of roughly 78.9 million shares afterward, the board and president would change, and the company must sell off its pre-closing business. It had also lent Thatcher $190,000, to be cancelled at closing.

material agreement

KAL ENERGY INC deregistered its securities, ending its obligation to file reports with the SEC.

listing compliance notice