Founders of ZaZa Energy Corp. (NasdaqCM: ZAZA) agreed to convert $47.3 million in subordinated notes into a combination of common shares and a new series of perpetual preferred stock, the company said Feb. 25.
Shareholders of the notes to be converted will receive about 3.16 million common shares, valued at $0.9495 each, the company said. The amount of shares to be received is based on the volume weighted average price per share for ten trading days preceding the agreement, the company noted.
The new series of perpetual preferred stock has a $12.8 million liquidation preference, the company added. These shares will be issued as Series A cumulative, redeemable preferred stock, based on a $25 per share liquidation preference.
At year-end 2013, Zaza had about $26.3 million, in aggregate principal amount, in senior secured notes outstanding, the company said. It also had about $40 million outstanding in convertible senior notes and about $47.3 million in subordinated notes, the company added.
The senior secured notes’ amount was reduced to $15 million under the release of $11.5 million held in escrow from Hess Corp. (NYSE: HES), the company noted.
Under the current conversion agreement, ZaZa’s debt will be about $55 million, down from $113.6 million at year-end 2013, the company said, noting that the reduction is also partly due to the release of the Hess escrow.
The conversion of the subordinated notes is scheduled to coincide with the refinancing of the senior secured notes, ZaZa said, noting that the conversion is subject to the company’s repayment of the remaining $15 million of senior secured notes.
Houston-based ZaZa Energy is an E&P company focused on the Texas Eagle Ford and Eaglebine areas.
Recommended Reading
Canadian Government to Fund Portion of Cedar LNG’s $5.96B Development Cost
2025-03-24 - The Government of Canada has pledged to contribute up to $200 million to help the Haisla Nation and Pembina Pipeline Corp. develop the $5.96 billion Cedar LNG Project
Trump Ambiguous Whether Canadian-Mexico Tariffs to Include Oil
2025-01-31 - At a news conference, President Trump said that he would exclude oil from tariffs before backtracking to say that he “may or may not” impose duties on crude.
US NatGas in Storage Grows for Second Week
2025-03-27 - The extra warm spring weather has allowed stocks to rise, but analysts expect high demand in the summer to keep pressure on U.S. storage levels.
US LNG Exports May See EU Demand Drop-Off, Asian Surge
2025-03-27 - Ukrainian peace talks could end with Russian gas back on the market, Poten & Partners analysts said.
Arc Resources to Supply Exxon with LNG Offtake from Cedar LNG
2025-03-11 - Exxon Mobil Asia Pacific Pte. Ltd. has agreed to buy 1.5 million tonnes per annum of ARC Resources’ LNG offtake from the Cedar LNG Project when the facility begins commercial operations.