Endeavour Announces Redemption and Amendment of Convertible Preferred Stock
November 18th, 2009 - Posted in Energy CompaniesHOUSTON, Nov. 17 /PRNewswire-FirstCall/ — Endeavour International Corporation (Amex: END - News; LSE: ENDV - News) today announced that it has signed an agreement to redeem $75 million of its $125 million Series C Convertible Preferred Stock and amend the terms of the remaining $50 million outstanding. The redemption and amendment reduces the current dilution to common shareholders and eliminates the potential dilution Endeavour common shareholders faced if equity capital was utilized for value-added growth opportunities.
We believe the redemption and amendment gives Endeavour additional simplicity in its capital structure and financial flexibility to create further avenues for growth by removing the dilution uncertainty for our common equity,” said William L. Transier, chairman and chief executive officer. “Endeavour has not pursued several potential business opportunities due to concerns about dilution to our common shareholders. Our convertible preferred stockholders also recognized the restrictive impact of the anti-dilution provisions to our growth efforts. The ability to accomplish this very positive transaction with our convertible holders is a strong endorsement of our management team and the underlying value of Endeavour.”
Endeavour’s redemption of $75 million will include a $25 million cash payment and the issuance of a five-year $50 million subordinated note payable, pre-payable at anytime, bearing cash interest at an annual rate of 10 percent plus two percent interest accruing in the balance of the note. It will amortize over a four-year period beginning in 2011. The remaining $50 million outstanding Series C Convertible Preferred Stock has been amended to reduce the annual dividend rate to 4.5 percent from 8.5 percent, adjust the conversion price to $1.25 per share and eliminate the previously included anti-dilution provisions.(more)
