Ann: Quantum Leap for LWP Technologies, page-2

INVESTMENT HIGHLIGHTS:  First Commercial Transaction - LWP enters into JV to commercialise proppants  Milestones 2 & 3 triggered under Ecopropp Acquisition Agreement  LWP completes further $6.6 m capital raising First Commercial Transaction LWP Technologies Limited (ASX: LWP) (LWP, the Company) is pleased to announce that it has entered into a Joint Venture Agreement with Hallmark Minerals (I) Pvt Ltd (Hallmark),for the production of LWP’s flyash-based proppants, in the state of Maharashtra in India. This major milestone for LWP represents the first commercialisation transaction for its next generation, light weight ceramic proppants, designed for use in hydraulic fracturing (fracking) of oil and gas wells globally. Hallmark is a leading manufacturer of ceramic proppants. Under the terms of the Joint Venture, LWP’s technology will be utilised to produce its unique flyash proppants in the Hallmark manufacturing facility, which has previously manufactured bauxite-based ceramic proppants. A joint venture company will be formed which will be co-owned by LWP and Hallmark. (JV Company) Joint Venture Agreement LWP will own 60% of the JV Company and Hallmark will own the remaining 40%. Pursuant to the Heads of Agreement terms:  The JV Company will own the manufacturing plant;  LWP will receive US$1 million for the technology license for the state of Maharashtra in India;  LWP will receive 10% of gross revenues in royalties for the technology license;  The Partners of the JV Company will establish a Board consisting of five members and LWP will nominate three members including the Chairman; and  The JV Company will investigate additional opportunities for expansion in Maharashtra province including the major cities of Mumbai and Nagpur. LWP and Hallmark have agreed to prepare such further documentation as may be required to implement the Joint Venture Agreement. LWP Technologies Limited, Suite 29 Level 54 111 Eagle Street Brisbane ABN 80 112 379 503 │T +61 (0)7 3122 2233 │F +61 (0)7 3012 6699 | E [email protected] | W www.Lwptech.com LWP Technologies Limited, Suite 29 Level 54 111 Eagle Street Brisbane ABN 80 112 379 503 │T +61 (0)7 3122 2233 │F +61 (0)7 3012 6699 The Manufacturing Facility Located in the city of Pune in the Maharashtra province of India, the facility currently has a maximum manufacturing capacity of 12,000 tonnes per annum, operating primarily on a batch processing basis. It is the Joint Venture partners’ intention to increase existing capacity via automation to a 24/7 operation. The Facility previously manufactured bauxite based ceramic proppants for the oil & gas industry. Trigger Events – Milestones 2 & 3 Achieved LWP also advises that pursuant to the terms of the previously announced acquisition agreement (Acquisition Agreement) between LWP (then known as Coretrack, ASX: CKK) and Ecopropp (ASX announcement, 12 May 2015), execution of the LWP-Hallmark Joint Venture Agreement will result in Milestones 2 and 3 of the LWP-Ecopropp agreement being satisfied. The satisfaction of both of these Milestones will allow LWP to make the final purchase price payment due under the Acquisition Agreement with a final issue of approx. 1.054 billion LWP Shares to the Ecopropp vendors, pursuant to the Acquisition Agreement. LWP Chairman Siegfried Konig said “The signing of this agreement is the culmination of intensive effort over a long period by the LWP team and I am delighted that the loyal Ecopropp shareholders will now be rewarded for their patience. The Hallmark manufacturing facility has a replacement value in excess of US$15 million and the Joint Venture will allow us to enter the market more rapidly than would otherwise be the case and prove our technology down-hole in a much shorter period of time. While our long term focus remains on being a technology licensor, making the majority of income from royalties, in the initial stages of commercialisation we will seek to take advantage of plants in working order that are easily converted to our process and that can be acquired for well below replacement cost. The Hallmark Joint Venture represents the first execution of this strategy.” Capital Raising In conjunction with the signing of the JV, LWP has completed a capital raising of AUD$6.6 million at prices of AUD$ 0.01 to AUD$ 0.011 cents per share to professional and sophisticated investors in both Australia and the United States. State One Stockbroking Ltd acted as Lead Manager to the Placement and was supported by the Company’s U.S. advisor, New York based EAS Advisors LLC, acting through Merriman Capital, Inc. Chairman Siegfried Konig stated “We were astounded and overjoyed with the support we have received from both current large shareholders and many new large institutional investors and would like to thank EAS Advisors in particular for their assistance. The placement was oversubscribed beyond the initial target of USD $4 million (AUD $5.4 million AUD). The funds will allow LWP to execute our plans in the Maharashtra province of India and provide us with additional working capital to investigate similar commercialization opportunities.”