Wells Energy Commits to Mountainview Facility
Mountainview Energy announced its wholly owned subsidiary, Mountain Divide, entered into a commitment letter with Wells Fargo Energy Capital, with respect to a new term facility and a $16 million unsecured subordinated convertible promissory note to replace the current senior secured advancing credit facility between the borrower and the lender in connection with the company’s 12-Gage project in the Williston Basin in Divide County, ND; and = the 39% after pay-out net profits interest (the NPI) associated with the old facility.
Terms for the $49.5 million term loan facility are as following: The floating rate was calculated as the base rate plus 4%. The base rate is defined as the maximum of 4%, the Wells Fargo stated prime rate, one-half of one percent (0.50%) per annum above the federal funds rate, or 1.5% above a LIBOR based calculated rate. At this time, the base rate is 4% and the effective floating rate is 8%. Monthly repayments of outstanding interest plus principal are required on the new facility based on 85% of net profits from the 12-gage project.
Maturity is October 1, 2016.