Skope Energy sets terms on minimum C$15 million five-year convertibles to yield 8%, up 30%

By Rebecca Melvin

New York, Dec. 2 - Skope Energy Inc. said it has set the terms on a minimum principal amount of C$15 million of five-year convertible unsecured subordinated debentures on a bought deal basis to yield 8% with an initial conversion premium of 30%, according to a news release.

The Regulation S deal, which has a 15% greenshoe, is being underwritten by a syndicate of underwriters co-led by National Bank Financial Inc. and CIBC World Markets Inc. and also includes GMP Securities LP and HSBC Securities (Canada) Inc.

The bonds are non-callable until Dec. 31, 2014 and then are provisionally callable for one year until Dec. 31, 2015 at a price hurdle of 125%. After Dec. 31, 2015, the debentures are freely callable.

About C$12 million of the proceeds will be used to reduce amounts outstanding under the company's credit facility, which will be permanently reduced to C$48 million. The balance of the proceeds will be applied to further reduce the credit facility.

The public offering, being offered in all of the provinces of Canada excluding Quebec, is expected to close the week of Dec. 19 and is subject to regulatory approval.

Skope is a Calgary, Alta.-based oil and natural gas exploration and development company.

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