JED Oil signs engagement agreement with CB Securities, gets extension on forbearance agreement

By Devika Patel

Knoxville, Tenn., July 18 - JED Oil Inc. said it has signed an engagement agreement with CB Securities Inc. to market JED's northern Alberta oil and gas assets in the Steen River area of northern Alberta.

Proceeds from the asset sales will be used to redeem JED's $40.24 million of 10% senior subordinated convertible notes, plus interest from Jan. 1, and to pay outstanding trade creditors. The balance of proceeds will be used for the company's 2008-2009 drilling program and general working capital.

The sales are expected to close by Oct. 31, unless shareholder approval is required. In that case, the sales are expected to close by Nov. 21

The forbearance and note amending agreement between JED and holders of a majority of the notes containing the terms of the term sheet was signed on July 1.

The company and noteholders agreed that the deadlines in the July 1 forbearance agreement did not provide adequate time to market the assets.

Accordingly, JED and holders of a majority of the notes signed an amended and restated forbearance and note amending agreement on July 11, which adopted the schedule of CB Securities for the asset sales and extended the maturity date of the notes to either Oct. 31 or Nov. 21 if shareholder approval is required.

JED Oil is an oil and natural gas company that is based in Didsbury, Alta.

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