Ryland Oil Reports on Closing of Debt Financing
Ryland Oil has closed the syndicated loan of CDN$8,000,000 previously announced on November 10, 2009. The loan is for a term of one year and bears interest at the rate of 10% per annum, calculated annually and payable quarterly. The final interest payment together with the principal amount are payable on the first anniversary of the date of the loan. The five lenders are arms' length to Ryland. In connection with the loan, the Company has issued 4,571,429 bonus shares at a deemed price of $0.35 per share to the lenders. The bonus shares are subject to a hold period expiring on April 16, 2010. Proceeds will be used to pay outstanding debts and for general working capital.
The Company also announces that it has received approval from the TSX Venture Exchange respecting the agreement with Fairway Exploration LLC ("Fairway") previously announced on November 26, 2009, pursuant to which Fairway has agreed to sell to Ryland a 3% overriding royalty which is held over production from all southeast Saskatchewan properties held by the Company's wholly owned subsidiary, Pebble Petroleum Inc. In return for the 3% royalty, the Company has agreed to pay Fairway a cash payment of US $1,200,000 and issue 1,200,000 common shares at a deemed price of CDN $0.36. The closing of the sale is pending