Nashville, Aug. 27 - InterOil Corp. announced the private placement of $30 million to $40 million of five-year 8.875% senior convertible debentures, plus warrants, to a limited number of institutional investors on Friday.
The debentures are immediately convertible at $20.16 or C$26.45. InterOil shares closed Thursday at C$23 on the Toronto Stock Exchange.
InterOil also issued five-year warrants to investors to purchase 239,610 to 319,480 shares with an exercise price of $21.91 or C$28.75.
As part of the terms of the private placement, InterOil has agreed to file a registration statement to cover the resale of the securities by the investors.
Toronto-based InterOil said it plans to use proceeds for additional working capital and general corporate purposes.
The company's assets include an oil refinery, upstream petroleum exploration licenses and retail and commercial distribution assets. Its chief operations are located in Papua, New Guinea.
Terms of the deal are:
| Issuer: | InterOil Corp.
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| Issue: | Convertible senior debentures
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| Amount: | $30 million to $40 million
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| Maturity: | 5 years
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| Coupon: | 8.875%
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| Conversion price: | $20.16 or C$26.45
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| Forced conversion: | If stock is trading above $28.23 or C$37.03 after year one
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| Put: | After 21 months, in cash or common shares at a 10% discount
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| Announcement date: | Aug. 27
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| Distribution: | Private placement, with registration rights
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