By Devika Patel
Knoxville, Tenn., May 17 - Forbes Energy Services Ltd. said it has negotiated a $14.52 million private placement of 5% series B senior convertible preferred stock.
The company is selling 580,800 preferreds at $25.00 apiece.
The preferreds are initially convertible into common shares at 36 shares per preferred. They may be called at par plus dividends after three years if the stock price is more than 120% of the issue price. They are subject to mandatory redemption after seven years.
Settlement is expected May 20.
Proceeds will be used to repurchase, in cash, at least $6.6 million of the company's 11% senior secured notes and for general corporate purposes.
Based in Alice, Texas, Forbes Energy is an independent oilfield services contractor that provides a range of drilling- and production-related services to oil and natural gas companies, primarily onshore in Texas.
| Issuer: | Forbes Energy Services Ltd.
|
| Issue: | Series B senior convertible preferred stock
|
| Amount: | $14.52 million
|
| Shares: | 580,800
|
| Price: | $25.00
|
| Dividends: | 5%
|
| Conversion ratio: | Into 36 shares (per preferred)
|
| Call: | After seven years, or after three years if the stock closes above 120% of the issue price
|
| Warrants: | No
|
| Pricing date: | May 17
|
| Settlement date: | May 20
|
| Stock symbol: | Toronto: FRB
|
| Stock price: | C$0.54 at close May 17
|
| Market capitalization: | C$29.3 million
|
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