Business
Source Energy Announces Recapitalization Transaction with Substantial Support of Key Stakeholders
(TheNewswire) Calgary, Alberta - TheNewswire - Octobe...
About this update from Source Energy Services Ltd.
[{"type":"text","content":"Source Energy Announces Recapitalization Transaction with Substantial Support of Key Stakeholders\n \n \n (TheNewswire)\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Calgary, Alberta -\n \n \n TheNewswire -\n \n \n October 7, 2020\n \n \n (\n \n \n TSX:SHLE\n \n \n \n \n \n \n )\n \n \n \n \n Source Energy Services Ltd. (together with its\naffiliates, \"\n \n \n Source\n \n \n \" or the \"\n \n \n Company\n \n \n \")\nannounced today a proposed recapitalization transaction (the\n\"\n \n \n Recapitalization\nTransaction\n \n \n \") designed to provide the\nCompany with a stronger, long-term capital structure to withstand\ncurrent industry challenges and build on its position as the largest\nfrac sand provider in the Western Canadian sedimentary basin\n(\"\n \n \n WCSB\n \n \n \"). The Recapitalization Transaction is supported by\nholders of approximately\n \n \n 74\n \n \n % of the principal obligations under the Company's 10.5%\nsenior secured first lien notes due 2021 (the \"\n \n \n Notes\n \n \n \") and\n \n \n \n shareholders holding\napproximately 45\n \n \n \n % of Source's common\nshares\n \n \n .\n \n \n \n \n The Recapitalization Transaction will, among other\nthings:\n \n \n \n \n \n \n - proactively address the maturity and obligations\n(including all accrued and unpaid interest) under the Notes through an\nexchange of the Notes for a combination of new senior secured first\nlien notes due March 15, 2025 (the \"\n \n \n New Secured Notes\n \n \n \"), resulting in a $32.7 million decrease of the\nprincipal amount and the issuance of new common shares of Source,\nconstituting approximately 62.5% of the common shares outstanding on a\nfully diluted basis, immediately following completion of the\nRecapitalization Transaction (the \"\n \n \n New Common Shares\n \n \n \");\n \n \n \n \n - enable Source to access new funding under a $20.0\nmillion term loan facility (the \"\n \n \n BDC Facility\n \n \n \")\nfrom Business Development Bank of Canada (\"\n \n \n BDC\n \n \n \"), with\nparticipation from the Company's existing lending syndicate, as\ncontemplated under a non-binding term sheet executed between the\nCompany and BDC;\n \n \n \n \n - provide enhanced liquidity and financial flexibility\nas a result of the terms of the New Secured Notes and the BDC\nFacility, which enable the Company to pay interest i...