Finance & Investing | Debt | Capital Markets
Niobrara-Focused Shoreline Reduces Debt; Secures U.S. Lender
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Shoreline Energy Corp. has reported that, as a result of a dispute relating to conveyance of legal title, the $15,700,000 principal payment due June 19, 2013 (as described in notes to Shoreline's first quarter financial results) is no longer required to be paid by Shoreline.
As a result, Shoreline has reduced its current debt by $15,700,000.
In addition, Shoreline is pleased to announce that it has selected a US lender for its US assets for the purpose of repaying its $5,000,000 bridge loan and for working capital. The current terms of the proposed debt contemplate a $15,000,000, two year term facility, repayable at any time, with Libor plus 11.5% interest which is consistent with Shoreline's current cost of capital. Management anticipates that this facility will ensure that Shoreline can meet all its near term liabilities, working capital covenants, and capital expenditure needs, and most importantly correct its working capital covenant obligations with ATB Financial. Closing is scheduled on or before August 12, subject to completion of definitive documentation and fulfilment of certain closing conditions.
Also, Shoreline anticipates closing the final tranche of its flow through share offering on or about July 15, 2013 at which time Shoreline will publish its third quarter capital expenditure program and associated guidance.
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