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Terrace completes exchange of 8% convertibles for secured convertibles
By Marisa Wong
Morgantown, W.Va., May 13 – Terrace Energy Corp. said it completed its previously announced plan of arrangement, under which all of its outstanding 8% convertible unsecured notes due April 2, 2018 have been exchanged for new convertible secured notes due April 2, 2021.
The new notes will be listed for trading on the TSX Venture Exchange on May 17 under the ticker symbol “TZR.DB,” according to a Friday press release.
On Wednesday the company announced that the Supreme Court of British Columbia granted a final order approving the plan of arrangement.
The court approval was conditioned on approval from the holders of existing notes, which was obtained at a May 9 meeting. Holders representing 87.6% of the outstanding principal of the existing notes – or 91.7% in number of the holders – voted in favor of the arrangement.
As previously reported, the new notes will be convertible into common shares of the company at a conversion price of C$0.50 per share, compared to C$2.00 per share under the existing notes. They will be secured by a general security agreement against all of the company’s assets.
The new notes will be interest free but subject to a maturity bonus equal to 5% of the total outstanding principal amount of the new notes payable on their maturity date, in cash or common shares at the option of the company. In the event that the company redeems the new notes within 180 days prior to the maturity date, the redemption price will be 1.025% of par.
Terrace is a Vancouver, B.C.-based oil and gas development-stage company concentrating on unconventional oil extraction, particularly in South Texas.
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