Canacol Energy entered into a committed 24-month, $75 million senior secured term loan facility with Macquarie Group. Canacol intends on using the proceeds of the facility for general corporate purposes.
The initial draw on funding is expected to be $50 million, with a further commitment of $25 million available for a 12-month period should certain production metrics be met. The facility bears an annual interest rate of SOFR +8.0% on drawn amounts and 2.4% on undrawn amounts during the commitment period. The corporation expects to enter a SOFR hedging agreement with Macquarie fixing the interest rate. The facility matures on Sept. 3, 2026, and has a 12-month principal payment grace period. No prepayments may be made during the first twelve months. The facility is secured by all material assets of the corporation.
Covenants on the facility have been largely harmonized with the corporation’s existing covenants on its 2028 senior unsecured notes and its senior unsecured revolving credit facility which matures in February 2027.
In connection with the facility, Macquarie will be issued 1,888,448 common share purchase warrants, with each warrant entitling Macquarie to purchase one common share of the corporation at an exercise price equal to the five-day volume weighted average trading price of the common shares ending on the date hereof. The warrants will expire three years after the date of issuance. The Warrants remain subject to the final approval of the Toronto Stock Exchange.
