Bellatrix Announces Acquisition and Retirement of US$10 Million of Its Senior Unsecured Notes Due 2020
May 02 2018 - 6:54PM
Bellatrix Exploration Ltd. (“Bellatrix” or the “Company”) (TSX:BXE)
(NYSE:BXE) today announces that it has entered into an exchange
agreement with a holder (the "Holder") of its 8.50% senior
unsecured notes due May 15, 2020 (the “Senior Notes”) to exchange
in a privately negotiated transaction, US$10 million aggregate
principal amount of the Senior Notes for 7,081,837 common shares of
Bellatrix. Pursuant to the exchange agreement, the Senior
Notes will be acquired at a 10% discount to their face value, and
the common shares will be issued at a 5% discount to the volume
weighted average price on the Toronto Stock Exchange for a 20
trading day period preceding April 30, 2018, subject to the
satisfaction or waiver of the closing conditions. The terms of the
exchange agreement require the Company to qualify the common shares
issuable in the exchange pursuant to a prospectus supplement to be
filed by Bellatrix under the Company's existing base shelf
prospectus. The Toronto Stock Exchange (the "TSX") has
conditionally approved the listing of the common shares to be
issued pursuant to the exchange on the TSX. In addition,
application has been made to list the common shares to be issued
pursuant to the exchange on the New York Stock Exchange (the
"NYSE"). Listing will be subject to the Company fulfilling all of
the listing requirements of the TSX and the NYSE, as applicable.
The transaction is expected to close on or before May 7, 2018.
The reduction of US$10 million of Senior Notes
outstanding provides annualized interest savings of approximately
$1.1 million using the current Canadian/US dollar exchange
rate. The exchange agreement is consistent with Bellatrix’s
strategy to improve financial strength, optimize its capital
structure, and enhance long term shareholder value.
The Holder currently exercises control or
direction over 517,430 Bellatrix common shares. In addition, the
Holder currently exercises control or direction over $25,027,000
principal amount of convertible debentures of Bellatrix, which are
convertible into 3,089,753 common shares based on a conversion
price of $8.10 per common share. Following completion of the
exchange, it is expected that the Holder will exercise control or
direction over an aggregate of 7,599,267 common shares or 13.5% of
the Company's issued and outstanding common shares and if the
Holder was to elect to convert the convertible debentures held by
the Holder, the Holder would exercise control or direction over an
aggregate of 10,689,020 common shares or 17.9% of the Company's
issued and outstanding common shares (assuming no other holder of
the convertible debentures elected to convert their convertible
debentures). Under the terms of the exchange agreement, and
in an undertaking provided to the TSX, the Holder has agreed to not
convert the convertible debentures it holds if it would result in
the Holder beneficially holding greater than 19.9% of the issued
and outstanding common shares of the Company.
Bellatrix Exploration Ltd. is a publicly traded
Western Canadian based growth oriented oil and gas company engaged
in the exploration for, and the acquisition, development and
production of oil and natural gas reserves, with highly
concentrated operations in west central Alberta, principally
focused on profitable development of the Spirit River liquids rich
natural gas play.
For further information, please
contact:
Steve Toth, CFA, Vice President, Investor
Relations & Corporate Development (403) 750-1270
Bellatrix Exploration Ltd.1920,
800 – 5th Avenue SWCalgary, Alberta, Canada T2P 3T6Phone: (403)
266-8670Fax: (403) 264-8163www.bxe.com
FORWARD LOOKING STATEMENTS: Certain information
contained in this press release may contain forward looking
statements within the meaning of applicable securities laws. The
use of any of the words "forecast", "believe", "expect",
"position", "maintain", "continue", "plan", "future", "estimate",
"intend", "strategy", "anticipate", "enhance" and similar
expressions are intended to identify forward-looking statements.
More particularly and without limitation, this document contains
forward-looking statements concerning the expectation that the
common shares to be issued pursuant to the exchange will be
qualified for issuance pursuant to a prospectus supplement to be
filed by Bellatrix under the Company's existing base shelf
prospectus, the expected annualized interest savings resulting from
the reduction of amounts outstanding under the Senior Notes, the
expected number and percentage of the issued and outstanding shares
(and other securities) to be held by the Holder following
completion of the Exchange and Bellatrix’s strategy to improve
financial strength, optimize its capital structure and enhance long
term shareholder value, may constitute forward-looking statements
under applicable securities laws. To the extent that any
forward-looking information contained herein constitute a financial
outlook, they were approved by management on May 2, 2018 and are
included herein to provide readers with an understanding of the
anticipated funds available to Bellatrix to fund its operations and
readers are cautioned that the information may not be appropriate
for other purposes. Forward-looking statements necessarily involve
risks, including, without limitation, risks associated with any
delay or failure to file a prospectus supplement, obtain exchange
approval or satisfy the closing conditions for the exchange
transaction. Events or circumstances may cause actual results to
differ materially from those predicted, as a result of the risk
factors set out and other known and unknown risks, uncertainties,
and other factors, many of which are beyond the control of
Bellatrix. In addition, forward looking statements or information
are based on a number of factors and assumptions which have been
used to develop such statements and information but which may prove
to be incorrect and which have been used to develop such statements
and information in order to provide shareholders with a more
complete perspective on Bellatrix's future operations. Such
information may prove to be incorrect and readers are cautioned
that the information may not be appropriate for other purposes.
Although the Company believes that the expectations reflected in
such forward looking statements or information are reasonable,
undue reliance should not be placed on forward looking statements
because the Company can give no assurance that such expectations
will prove to be correct. In addition to other factors and
assumptions which may be identified herein, assumptions have been
made regarding, among other things, the closing of the exchange
transaction and the timely receipt of any required regulatory
approvals. Readers are cautioned that the foregoing list is not
exhaustive of all factors and assumptions which have been used. As
a consequence, actual results may differ materially from those
anticipated in the forward-looking statements. Additional
information on these and other factors that could affect
Bellatrix's operations and financial results are included in
reports (including, without limitation, under the heading "Risk
Factors" in the Company's Annual Information Form for the year
ended December 31, 2017) on file with Canadian and United States
securities regulatory authorities and may be accessed through the
SEDAR website (www.sedar.com), through the SEC website
(www.sec.gov), and at Bellatrix's website
(www.bellatrixexploration.com). Furthermore, the forward looking
statements contained herein are made as at the date hereof and
Bellatrix does not undertake any obligation to update publicly or
to revise any of the included forward looking statements, whether
as a result of new information, future events or otherwise, except
as may be required by applicable securities laws.