VANCOUVER, Sept. 30, 2013 /CNW/ - Lignol Energy Corporation (TSXV: LEC) ("LEC" or the "Company"), a leading technology company in the advanced biofuels and renewable chemicals sectors, today announced that the Company has agreed to vary the terms and conditions of its existing loan to Territory Biofuels Limited ("TBF") in the amount of A$500,000 (the "Loan") and LEC's recently announced investment (the "Investment") in TBF of up to A$1,000,000. The Company and TBF have agreed that the Loan and the Investment amounts will be applied to the subscription for secured convertible notes (the "Notes") of TBF, in the aggregate amount of up to A$1,500,000. In accordance with its previous Investment commitment, LEC has provided funding to TBF totaling A$500,000 and is in the process of providing the opportunity to existing TBF investors to subscribe for the remaining A$500,000 worth of Notes. Existing investors of TBF may subscribe for these Notes on the basis of their proportionate entitlement and LEC has agreed to fund any amounts not subscribed by these existing shareholders and to close this transaction no later than November 15, 2013. The closing of this entire transaction is subject to regulatory approval. Each of the Notes is convertible into ordinary shares of TBF after June 30, 2014 and at any time up to November 15, 2018. The Notes are interest free, due if not converted on December 15, 2018 and are secured by TBF's assets. The terms for the conversion of the Notes into TBF equity depends on a range of criteria related to the development of the Darwin facility amongst other matters, the outcome of which are expected to be known by June 30, 2014. Upon completion of the Investment, and the conversion of all the Notes, LEC is expected to increase its majority holding up to potentially between 76% and 87% of the issued and outstanding shares of TBF, and up to potentially between 75% and 86% on a fully diluted basis, assuming no other existing investors participate in this investment opportunity.