@Robin:
the here document is a trick to feed variables to read in a safe manner. The here document is pre-processed by the shell (and usually stored in a temp file) then opened as a stream. While processing the here document a `command` is executed and a $var is substituted, but not the contents of $var.
BTW the processing can be restricted by putting the EOF marker in quotes: <<"EOF" or <<'EOF', then the here document is treated as a quoted string.

I am not convinced that one cannot use the evil eval here.

Code:

while IFS="=" read VAR VALUE
do
  case "$VAR" in
    WHOA*)
    ;;
    [A-Z]*)
    eval $VAR='$VALUE'
    export $VAR
    ;;
  esac
done < $file