- Canadian Overseas Petroleum Limited (XOP) has signed purchase agreements for two convertible bonds worth of US$25.2 million
- One US$12.6 million bond will mature in 2024 and another US$12.6 million in 2025
- This will replace the previous bridge loan announced back in April
- The convertible is unsecured and permits the company to structure a new senior debt
- US$19.7 million from the convertible will be used to finance the cash component of the acquisition of the Cuda Energy LLC assets
- Canadian Overseas Petroleum Limited (XOP) is down 21.88 per cent and is trading at $0.25 per share as of 12:11 p.m. ET
Canadian Overseas Petroleum Limited (XOP) has signed purchase agreements for two convertible bonds with a total worth of US$25.2 million.
One convertible bond of US$12.6 million will mature in 2024 and another US$12.6 million maturing in 2025.
The company stated this will replace the previous bridge loan announced back in April and is structured to accommodate the implementation of a planned reserve-based loan facility. The convertible is initially unsecured and permits the company to structure a new senior debt.
According to Canadian Overseas, a tap feature has been included to increase the convertible which will allow the company to draw further development funds to increase production or for future drilling plans.
Canadian Overseas shared that the subscription proceeds of US$19.7 million from the convertible will be used to finance the cash component of the acquisition of the Cuda Energy LLC assets.
The convertible has a 13 per cent interest per annum in cash. Interest will accumulate and increase by 0.75 per cent every three months until Canadian Overseas gives notice to the bondholders that it shall henceforth pay all interest coupons in cash.
Interest will then decrease by 2.00 per cent each year, and no further quarterly increases will apply as Canadian Overseas provides a notice that it will pay interest and make whole payments in cash moving forward.
Canadian Overseas Petroleum Limited (XOP) is down 21.88 per cent and is trading at $0.25 per share as of 12:11 p.m. ET.