Messrs. Hai Zhou and Feng Jin

October 02, 2013 16:24 ET

Messrs. Hai Zhou and Feng Jin Acquire Convertible Debentures of Sundance Energy Corporation

TORONTO, ONTARIO--(Marketwired - Oct. 2, 2013) - Messrs. Hai Zhou and Feng Jin (the "Subscribers") are pleased to announce that they have entered into a subscription agreement (the "Subscription Agreement") with Sundance Energy Corporation ("Sundance"), pursuant to which the Subscribers, on a private placement basis, each have purchased a 10% secured subordinated convertible debenture in the principal amount of $250,000 ("Principal Amount").

The debentures will bear interest at the rate of ten percent (10%) per annum, payable quarterly and will mature on the date that is the earlier of: (a) five years from the date of issuance; and (b) the date that is sixty days' following the receipt (the "60 Day Date") by Sundance of written notice from the Subscriber of a debenture that the term has been reduced to such 60 Day Date, which notice may be given in a Subscriber's sole discretion at any time during the period from two years from the date of issuance until five years from the date of issuance of the debenture.

The debentures will be secured against the personal and real property of Sundance and will be convertible at a Subscriber's option into common shares of the Sundance (the "Common Shares") at a conversion price of: (i) $0.05 per common share until the date that is one year from the closing date; and (ii) $0.10 per common share for the period from the date following one year from the closing date up to and including the maturity date.

As of the date of this news release, the Subscribers do not own any Common Shares.

If a Subscriber converts the entirety of the Principal Amount of their debenture into Common Shares at the conversion price of $0.05, that Subscriber will be entitled to 5,000,000 Common Shares which will represent approximately 24.3% of the total issued and outstanding Common Shares of Sundance.

Pursuant to the Subscription Agreement, if a Subscriber has converted their Principal Amount into such number of Common Shares that it holds 10% or more of the outstanding Common Shares of Sundance, it shall, jointly with any other holder of a convertible debenture that has converted their holdings into 10% or more of the outstanding Common Shares ("10% Converted Holder"), have the right to collectively appoint one nominee (the "Debenture Nominee") to Sundance's board of directors (the "Board"), subject to the approval of such Debenture Nominee by the TSX Venture Exchange. Thereafter, all 10% Converted Holders will jointly be entitled to collectively nominate (with the support of the Board) at least one member of the Board, provided that the number of Debenture Nominees on the Board will be proportionately adjusted (rounded up to the nearest whole number) to account for any increase in the number of members on the Board above five.

The Purchased Shares were acquired for investment purposes. Depending on market conditions and other factors, the Subscribers may from time to time acquire additional securities of Sundance or dispose of securities of Sundance in the open market, by private agreement or otherwise.

A copy of the requisite early warning report will be filed on the SEDAR profile for Sundance Resources Corp. at www.sedar.com.

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