Sunshine Oilsands Ltd. Announces Private Placement Financing of HK $336 Million of Common Shares and Warrants Under the General Mandate

CALGARY, Alberta and HONG KONG, Dec. 3, 2013 /CNW/ - Sunshine Oilsands Ltd. ("Sunshine" or the "Corporation") (HKEX: 2012, TSX: SUO) is pleased to announce that it has received and accepted irrevocable subscription agreements (the "Subscription Agreements ") for 197,976,471 units of the Corporation ("Units") at a price of HK $1.70 per Unit (the "Subscription Price") (approximately CDN $0.23 per Unit at current exchange rates) for total gross proceeds of HK $336,560,000 (approximately CDN $46.1 million) (the "Placing").

Each Unit is comprised of one Class "A" Common Voting Share of the Corporation ("Common Share") and one-third of one purchase warrant of the Corporation ("Warrant"). Each whole Warrant entitles the holder to acquire one Common Share at an exercise price of HK $1.88 per Common Share (the "Warrant Exercise Price") (approximately CDN $0.26 per Common Share) for a period of 24 months following the closing date of the Placing. The Warrant Exercise Price will be subject to normal adjustment provisions in the case share capital or corporate reorganizations.

The respective subscribers (the "Subscribers" or each a "Subscriber") will subscribe for the following number of new Units pursuant to the Subscription Agreements:

(i) Global Petroleum Services Limited ("Global Petroleum"), an independent, third party investment company based in Hong Kong, will subscribe for 91,176,471 Units;

(ii) Immediate Focus International Limited ("Immediate Focus"), an independent, third party investment company based in Beijing, will subscribe for 90,000,000 Units;

(iii) Yarui Limited ("Yarui"), an independent, third party investment company based in Hong Kong will subscribe for 12,000,000 Units; and

(iv) Mr. Wang Yusen, an individual investor based in Hong Kong, will subscribe for 4,800,000 Units.

None of the Subscribers are connected persons to the Corporation.

In connection with the Placing, the Corporation has agreed to pay a finder's fee equal to 3% of the gross proceeds of the Placing to certain finders, which finders' fee may, at the sole election of the Corporation, be paid through the issuance of Units to the finders (the "First Finders") at a deemed price of HK $1.70 per Unit (the "Finder Price") (approximately CDN $0.23 per Unit). Additionally, the Corporation has agreed to pay certain other finders (the "Second Finders") a finders' fee equal to two-fifths of a Warrant for each Unit issued under the Placing.

With respect to the subscription of Global Petroleum, the First Finder is Far East Enterprise Investment Foundation Limited ("Far East"), an independent, third party investment company based in Hong Kong, which will receive a 3% cash fee equal to HK $4,650,000. With respect to the subscriptions for Immediate Focus, Yarui and Mr. Wang Yusen, the First Finder is Sunny Stone Limited, an independent, third party investment company based in Hong Kong, which will receive a 3% cash fee equal to HK $5,446,800. None of the First Finders are connected persons to the Corporation.

With respect to the subscription of Global Petroleum, the Second Finder is Goldeast Limited, an investment company based in Hong Kong, which will receive 36,470,588 Warrants. With respect to the subscriptions for Immediate Focus and Yarui, the Second Finder is Million View Limited, an independent, third party investment company based in Hong Kong, which will receive 40,800,000 Warrants. With respect to the subscription for Mr. Wang Yusen, the Second Finder is Hinds Industrial (Hong Kong) Company Limited, an independent, third party investment company based in Hong Kong, which will receive 1,920,000 Warrants. None of the Second Finders are connected persons to the Corporation.

The Subscription Price, the Warrant Exercise Price, the Finder Price and the cash finder's fee were determined by negotiation between the Corporation, the Subscribers, the First Finders and the Second Finders.

An application will be made by Sunshine to the Hong Kong Stock Exchange for the listing of, and permission to deal in, the Common Shares to be issued pursuant to the Units issued to the Subscribers, the First Finders and the Second Finders.

Each of the Subscription Price and the Finder Price represent:

(i) a discount of approximately 7.1% to the average closing price per Common Share of approximately HK $1.83 as quoted on the Hong Kong Stock Exchange for the last thirty (30) trading days up to and including December 2, 2013 (being the trading day immediately preceding the signing of the Subscription Agreements);

(ii) a discount of approximately 9.6% to the average closing price per Common Share of HK $1.88 as quoted on the Hong Kong Stock Exchange for the last five (5) trading days up to and including December 2, 2013 (being the trading day immediately preceding the signing of the Subscription Agreements); and

(iii) a discount of approximately 4.5% to the closing price per Common Share of HK $1.78 as quoted on the Hong Kong Stock Exchange on December 2, 2013 (being the trading day immediately preceding the signing of the Subscription Agreements).

The Warrant Exercise Price represents:

(i) a premium of approximately 2.7% to the average closing price per Common Share of approximately HK $1.83 as quoted on the Hong Kong Stock Exchange for the last thirty (30) trading days up to and including December 2, 2013 (being the trading day immediately preceding the signing of the Subscription Agreements);

(ii) a premium of approximately 0.0% to the average closing price per Common Share of HK $1.88 as quoted on the Hong Kong Stock Exchange for the last five (5) trading days up to and including December 2, 2013 (being the trading day immediately preceding the signing of the Subscription Agreements); and

(iii) a premium of approximately 5.6% to the closing price per Common Share of HK $1.78 as quoted on the Hong Kong Stock Exchange on December 2, 2013 (being the trading day immediately preceding the signing of the Subscription Agreements).

To the best of the Directors' knowledge, information and belief after having made all reasonable enquiries, each of the Subscribers, the First Finders and the Second Finders and, if applicable, their ultimate beneficial owner is/are third parties independent of and not connected with Sunshine and the connected persons of Sunshine.

The Common Shares to be issued pursuant to the Units issued to the Subscribers represent approximately 6.9% of the existing issued Common Shares and, immediately following the completion of the Placing, approximately 6.4% of the then enlarged total issued Common Shares of the Company.

Assuming the cash finder's fee is paid in Units, and assuming the exercise of all Warrants issued to the Subscribers, the First Finders and the Second Finders, the Common Shares to be issued pursuant to the Units issued to the Subscribers, the First Finders and the Second Finders and upon the exercise of all Warrants will total 351,078,275 and will represent approximately 12.2% of the existing issued Common Shares and, immediately following the completion of the Placing, approximately 10.8% of the then enlarged total issued Common Shares of the Company

Closing of the Placing is conditional upon: (i) the Hong Kong Stock Exchange ("HKEX") and the Toronto Stock Exchange approving the listing of the Common Shares comprising the Units, the Common Shares issuable upon exercise of the Warrants and the Common Shares issuable in connection with the payment of the finder's fees; (ii) compliance of the Placing with other requirements under the HKEX Listing Rules and the Hong Kong Code on Takeovers and Mergers or otherwise of the HKEX and the Securities and Futures Commission of Hong Kong; and (iii) the receipt of all other required regulatory approvals. One or more closings, commencing on or about December 6, 2013, are expected to occur for the Subscription Agreements upon receipt of listing approvals and the subscription proceeds from each Subscriber.

REASONS FOR THE PLACING AND USE OF PROCEEDS FROM THE PLACING

The Directors consider that the Placing represents an opportunity to raise capital for Sunshine at an important time for the Corporation. The net proceeds of the Placing, after payment of the cash finder's fee will be HK $326,463,200 (approximately CDN$ 44.7 million) which will be used by the Corporation to address its short term capital requirements, corporate objectives and for general corporate purposes.

EFFECTS ON SHAREHOLDING STRUCTURE

The existing shareholding structure of Sunshine and the effect of the Placing on the shareholding structure of Sunshine immediately following the completion of the Placing is set out below. The following table assumes the cash finder's fee is paid in cash and no Warrants are exercised.

GENERAL MANDATE TO ISSUE THE NEW COMMON SHARES

The Common Shares issued pursuant to the Units will be allotted and issued under the General Mandate granted to the Board at the annual general meeting of Sunshine held on May 7, 2013 to issue up to 20% of its aggregate issued and outstanding share capital (the "General Mandate"). As at the date of this announcement, Sunshine has not issued any Common Shares under the General Mandate. The Common Shares when issued pursuant to the Units will be credited as fully paid and rank pari passu in all respects with the other existing Common Shares.

Completion of the Placing is subject to the satisfaction of certain conditions. Shareholders and potential investors are advised to exercise caution when dealing in the securities of Sunshine.

Trading in the Common Shares will resume at 1:00 p.m. today (Hong Kong time).

ABOUT SUNSHINE OILSANDS LTD.

Sunshine Oilsands Ltd. is one of the largest holders of oil sands leases by area in the Athabasca oil sands region, which is located in the province of Alberta, Canada. Since Sunshine's incorporation on 22 February 2007, Sunshine has secured over one million acres of oil sands leases (equal to approximately 7% of all granted leases in this area).

Sunshine's principal operations are the evaluation, development and production of its diverse portfolio of oil sands leases. Its principal operating regions in the Athabasca area are at West Ells, Thickwood, Legend Lake, Harper, Muskwa, Goffer, Pelican and Portage. Sunshine's oil sands leases are grouped into three main asset categories: clastics, carbonates and conventional heavy oil.

FORWARD-LOOKING INFORMATION AND DISCLAIMER

This announcement may contain forward-looking information that is subject to various risks, uncertainties and other factors. All statements other than statements and information of historical fact are forward-looking statements. The use of any words "estimate", "forecast", "expect", "project", "plan", "target", "vision", "goal", "outlook", "may", "will", "should", "believe", "intend", "anticipate", "potential", and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on Sunshine's experience, current beliefs, assumptions, information and perception of historical trends available to Sunshine, and are subject to a variety of risks and uncertainties including, but not limited to those associated with resource definition and expected reserves and contingent and prospective resources estimates, unanticipated costs and expenses, regulatory approval, fluctuating oil and gas prices, expected future production, the ability to access sufficient capital to finance future development and credit risks, changes in Alberta's regulatory framework, including changes to regulatory approval process and land-use designations, royalty, tax, environmental, greenhouse gas, carbon and other laws or regulations and the impact thereof and the costs associated with compliance.

Although Sunshine believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned that the assumptions and factors discussed in this information release are not exhaustive and readers are not to place undue reliance on forward-looking statements as our actual results may differ materially from those expressed or implied. Sunshine disclaims any intention or obligation to update or revise any forward-looking statements as a result of new information, future events or otherwise, subsequent to the date of this announcement, except as required under applicable securities legislation. The forward-looking statements speak only as of the date of this announcement and are expressly qualified by these cautionary statements. Readers are cautioned that the foregoing lists are not exhaustive and are made as at the date hereof. For a full discussion of our material risk factors, see "Risk Factors" in our most recent Annual Information Form, "Risk Management" in our current MD&A and risk factors described in other documents we file from time to time with securities regulatory authorities, all of which are available on the Hong Kong Stock Exchange at www.hkexnews.hk, on the SEDAR website at www.sedar.com or our website at www.sunshineoilsands.com.

This document does not constitute and is not an offer to sell or a solicitation of an offer to buy common shares of Sunshine in the United States (including its territories and possessions, any State of the United States and the District of Columbia) or elsewhere.

SOURCE Sunshine Oilsands Ltd.