Zargon Oil & Gas Ltd. ("Zargon" or the "Company") (TSX:ZAR)(TSX:ZAR.DB) announces that it has taken up $15.56 million aggregate principal amount of its 6.00% convertible unsecured subordinated debentures (the "Debentures") at tender prices ranging from $890 to $1,000 per $1,000 principal amount of Debentures, for a total cash consideration of $14.84 million, which is equivalent to an average cost of $954 per debenture. The redemption of the Debentures was completed pursuant to the Company's previously announced redemption of up to $19 million aggregate principal amount of Debentures at cash prices determined by a "Dutch auction" process (the "Redemption Auction").
Holders of the Debentures ("Debentureholders") had the opportunity under the Redemption Auction to tender their Debentures until 5:00 p.m. (Eastern Time) on March 31, 2017. A total of $15.56 million aggregate principal amount of Debentures were properly tendered and not withdrawn under the Redemption Auction, all of which was taken up at the respective tender price for such Debentures. Payment of the redemption price for Debentures being redeemed will be in cash and will be made promptly in accordance with the terms of the indenture governing the Debentures.
As of April 1, 2017, changes to the Debentures took effect, which are more particularly described in the Company's information circular dated January 16, 2017 (the "Information Circular") and as approved by the Debentureholders at a meeting held February 14, 2017. Debentures that were not tendered and were not redeemed pursuant to the Redemption Auction (the "Amended Debentures") now have an annual interest rate of 8.00%, a maturity date of December 31, 2019 and are subject to other changes as further described in the Information Circular (available on the Company's SEDAR profile at www.sedar.com).
The Amended Debentures will commence trading on the Toronto Stock Exchange under the new symbol "ZAR.DB.A" at the open of markets on April 3, 2017. After giving effect to the Redemption Auction, there is approximately $41.94 million aggregate principal amount of the Amended Debentures outstanding.
Macquarie Capital Markets Canada Ltd. acted as exclusive financial advisor to Zargon for this component of its strategic alternatives process.
Zargon is a Calgary based oil and natural gas company working in the Western Canadian and Williston sedimentary basins and is focused on oil exploitation projects (waterfloods and tertiary ASP) that profitably increase oil production and recovery factors from existing oil reservoirs.
In order to learn more about Zargon, we encourage you to visit Zargon's website at www.zargon.ca where you will find a current shareholder presentation, financial reports and historical news releases.
SOURCE: Zargon Oil & Gas Ltd.
The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.