By Sheri Kasprzak
New York, June 14 - North American Palladium Ltd. has exercised its right to require Kaiser-Francis Oil Co. to buy another $13.5 million in convertible notes as part of the $58.5 million note offering closed in March.
The new notes bear interest at 6.5% annually, are due in one year and are convertible into common shares at $12.18 each.
Kaiser will also receive warrants equal to half of the shares issuable upon conversion of the new notes. The warrants are exercisable at the lesser of $13.48 or the volume weighted average price for the five trading days before exercise.
Proceeds from the new notes will be used to repay a loan to Kaiser.
On March 3, North American Palladium issued 6.5% notes to Kaiser-Francis and other investors. Those notes were convertible into common shares at a 13% premium to the market price at closing.
Toronto-based North American is a platinum group metals exploration company.
| Issuer: | North American Palladium Ltd.
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| Issue: | Convertible notes
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| Amount: | $13.5 million
|
| Maturity: | One year
|
| Coupon: | 6.5%
|
| Price: | Par
|
| Yield: | 6.5%
|
| Conversion price: | $12.18
|
| Warrants: | Equal to 50% of the shares issuable upon conversion
|
| Warrant expiration: | Four years
|
| Warrant strike price: | The lesser of $13.48 or VWAP for the five trading days before exercise
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| Investors: | Kaiser-Francis Oil Co.
|
| Announcement date: | June 14
|
| Stock symbol: | Amex: PAL
|
| Stock price: | $7.40 at close June 13
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