By Susanna Moon
Chicago, June 13 – Eco-Stim Energy Solutions Inc. executed a $15 million negotiable demand promissory note in favor of Eco-Lender, LLC and an affiliate of one or more funds managed by Fir Tree, Inc. on June 8, according to an 8-K filing with the Securities and Exchange Commission.
The funds collectively hold a majority of the outstanding shares of capital stock of the company.
Under the note, the lender advanced about $5.5 million of funds to the company on June 8.
The company said it may not reborrow any amounts that have been advanced and repaid under the note, and the lender is not obligated to make any additional advances under the note after the initial advance.
Interest accrues at an annual rate of 10% on the unpaid principal balance of the note, subject to a default interest rate of 14% or 24% depending on the payment date following the occurrence of a default.
The company may prepay the principal, interest and other amounts under the note with a prepayment premium of 4%, provided that the minimum amount is the lesser of $1 million and the outstanding balance at the time.
All of the company’s obligations under the note are guaranteed by EcoStim, Inc., a wholly owned subsidiary of the company.
Proceeds will be used for general working capital purposes.
The Houston-based oilfield services company is focused on reducing the ecological impact and improving the economic performance of the well stimulation process.
| Issuer: | Eco-Stim Energy Solutions Inc.
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| Guarantor: | EcoStim, Inc.
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| Issue: | Negotiable demand promissory note
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| Amount: | $15 million
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| Coupon: | 10%
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| Pricing date: | June 13
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