Endeavour Completes Financing Transactions with Smedvig Family

Endeavour International Corporation confirmed the closing of the previously announced $40 million (USD) investment by the Smedvig Family Office of Norway. The Smedvig family also committed an additional $60 million (USD) for future investments with Endeavour on terms to be decided at the time of the investment. The initial investment of $40 million (USD) and a new $25 million (USD) lending facility with its primary banks has been used, together with existing cash resources, to retire the $75 million (USD) second lien term loan established as part of the Talisman asset acquisition in 2006. The retired second lien term loan carried an interest rate of Libor plus 700 basis points and a number of restrictive covenants, including the requirement to pay dividends to the companies' preferred shareholders with common stock.

"The completion of these transactions is another significant step in the growth of our company," said William L. Transier, chairman, president and chief executive officer. "The refinancing improves the company's cost of capital and removes onerous restrictions contained in the second lien covenants that we believe were a hindrance to the company's future growth plans. The Smedvig family investment represents a vote of confidence in our management team and the company's ability to execute on its future business strategy."

The Smedvig family investment takes the form of a $40 million (USD) convertible note due 2014 with a conversion price of $2.36 (USD) and carries a coupon of 11.5%. The coupon will not be paid in cash, but will accrue and be convertible into common shares at the conversion price. The new lending facility, which the company expects to repay during 2008, bears interest at Libor plus 350 basis points.

Company: Endeavour International Corporation more info
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