Cyclone Power Technologies, Inc. (fka CYPW)

[zeekhoe]

NEWS: Cyclone Power Technologies Approves Plan to Capitalize and Spin-Off Its Waste Heat Subsidiary "WHE Generation"

http://www.otcmarkets.com/news/otc-market-headline?id=16296468

Jul 17, 2014 (ACCESSWIRE via COMTEX) -- Cyclone plans to improve balance sheet and cash position with funds raised in transactions, continuing equity interest in WHE GEN, and on-going licensing royalty payments
POMPANO BEACH, FL / July 17, 2014 / Cyclone Power Technologies Inc. (OTCQB: CYPW), developer of the all-fuel clean-tech Cyclone Engine, announced that its Board of Directors has approved and the Company has signed the first agreements in a series of transactions to secure strategic capital funding for its subsidiary, WHE Generation Corp. ("WHE GEN"), while materially reducing Cyclone's liabilities and building long-term value for its shareholders.

These transactions are formalized in a Separation Agreement and Amended License Agreement between Cyclone and its subsidiary. They will form the foundation by which WHE GEN plans to raise funding and structure its business moving forward. Upon the successful closing of WHE GEN's contemplated financings, Cyclone is expected to receive $175,000 in license and consulting fees, retire all of its senior secured debt, reduce other payables by approximately $200,000, and remove another $300,000 in contract liabilities from its balance sheet.

Cyclone may raise additional capital from the sale of a portion of its WHE GEN equity holdings to further reduce existing debt and provide operating capital. It will retain a minority equity interest in WHE GEN, estimated between 12% and 23% depending on the size of the several capital raises. Should WHE GEN be successful in its future business pursuits, Cyclone will also benefit from on-going licensing revenue in the form of royalties from WHE GEN.

In connection with the Separation Agreement, Christopher Nelson is moving to the position of Chief Executive Officer of WHE GEN and has resigned as President of Cyclone. The Board appointed Frankie Fruge, whom has been with the Company since inception, as his replacement. Douglas Hutchinson has assumed the position of Chief Operating Officer of WHE GEN, and resigned as Vice President of Cyclone. Joel Mayersohn has also resigned as a Director of the Company to become a Director of WHE GEN.

Cyclone's Board has received a Fairness Opinion and Valuation Report from a certified valuation expert in connection with the Separation Agreement and funding structures. In the opinion of the expert, the transactions are fair to Cyclone's shareholders from a financial perspective.

Such securities which may ultimately be offered will not be or have not been registered under the Securities Act of 1933, and may not be offered or sold in the United States absent registration or an applicable exemption from registration.