BPZ Notes Exercise of Option Purchase for Senior Notes
BPZ Resources announced today that the initial purchaser of its previously reported offering of $140 million principal amount of 6.5% convertible senior notes due March 1, 2015 exercised in full its option to purchase an additional $21 million aggregate principal amount of the Notes. The Notes were sold in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. In addition, until March 15, 2010, the International Finance Corporation (IFC) has the right to participate in the Offering, which if exercised would increase the size of the Offering.
The Notes will be convertible under certain circumstances and during certain periods at an initial conversion rate of approximately 148.38 shares of BPZ's common stock per $1,000 principal amount of Notes, representing an initial conversion price of approximately $6.74 per share of BPZ common stock, which is equal to an approximate 20% conversion premium over the negotiated reference price.
Net proceeds from the sale of the Notes as a result of the option exercise, after deducting the discounts and commissions and any offering expenses payable by the Company, were approximately $20.3 million. The Company intends to use the net proceeds for general corporate purposes, including without limitation, capital expenditures and working capital, reduction or refinancing of debt, or other corporate obligations.
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