Cardinal Energy issues redemption notice for 8% convertibles

Chicago, Feb. 4 – Cardinal Energy Ltd. announced that it will redeem its outstanding $28,207,000 of 8% convertible subordinated debentures due Dec. 31, 2022 (Cusip: 14150GAB9), according to a press release.

The debentures have no pre-payment penalty.

The notes will be redeemed at par plus interest on March 11, 2021.

The debentures are listed on the Toronto Stock Exchange under the symbol “CJ.DB.A.”

Noteholders may convert their debentures into common shares of Cardinal at a conversion price of C$1.25 per share at any time before 5 p.m. ET on March 10.

Noteholders who convert their notes will receive approximately 800 shares per $1,000 note.

Any fractional shares will be paid in cash.

Funding for the redemption will come from a new issue of up to $26,884,423 of subordinated non-convertible notes which will be issued at 95 for proceeds of $26.75 million.

The new notes will have an 8% coupon until Sept. 30 and step up to 9% on Oct. 1, again move up to 10% on April 1, 2022 and further up to 12% on Sept. 30, 2022.

The closing of the new notes will occur on the redemption date.

The financing is being provided by certain insiders of the company.

The amount of notes issued will depend on the actual principal amount of debentures outstanding on the redemption date after giving effect to conversions, if any, before the redemption date.

Calgary, Alta.-based Cardinal Energy is an oil-focused company with operations in Alberta.

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