Calfrac Well Services converts C$44.8 million in PIK notes due 2023

By Mary-Katherine Stinson

Lexington, Ky., Dec. 22 – Calfrac Well Services Ltd. completed the conversion incentive program for its 10% 1.5 lien senior secured convertible PIK notes due 2023, according to a press release.

The program was launched on Nov. 22 and ended on Dec. 15.

Under the program, each noteholder that converted their notes to common shares during the early conversion period, received a payment equal to 50% of each holder's respective foregone interest entitlement from the date of conversion to the maturity date of the notes plus accrued interest. The payment was made on Dec. 18.

Approximately C$44.8 million principal amount of notes were converted under the program.

As a result, the company issued about 33.6 million shares upon conversion, reduced its outstanding debt by about C$44.8 million and realized savings of about C$2.3 million of interest that would have otherwise been payable on the notes.

It was announced on Nov. 22 that the company had conversion commitment letters from holders of an aggregate of C$43,254,000 principal amount of notes, or about 91% of the total notes outstanding, agreeing to convert all of their notes according to the program.

After the conversion, approximately C$2.7 million of notes remain outstanding.

Any notes that are not converted will continue to accrue interest and remain convertible for common shares on their existing terms.

Calfrac is a Calgary, Alta.-based company that provides specialized oilfield services to exploration and production companies.

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