Legend Oil gets release of obligations under parent’s financing as part of restructuring

By Toni Weeks

San Luis Obispo, Calif., Aug. 20 – Legend Oil and Gas Ltd. said it has obtained a release from any and all obligations under Legend Energy Canada, Ltd.’s financing. Legend Energy is the parent company of Legend Oil.

According to a press release, Legend Oil signed a release and settlement agreement with National Bank of Canada, the senior lender for Legend Energy, discharging Legend Oil from obligations under a general security agreement and letter of guarantee, both dated May 11, 2012, as well as a letter of financing entered into on July 17, 2012.

The bank also released its securities interests held in any and all assets of Legend Oil as part of the company’s restructuring.

Legend Oil paid C$250,000 to National Bank of Canada for providing the releases.

“When the restructuring of Legend began, one of the most urgent orders of business was to work with all of our financing partners to remedy Legend’s existing defaults under its various debt instruments and to create a financial platform from which to grow,” chief restructuring officer Andrew Reckles said in a press release.

Added chief financial officer Warren Binderman, “This resolution allows us to further expand the company’s operations and financial platform, such that we expect to have better access to the capital markets through banks and potential investors. Further, this settlement allows us to simplify our financial processes while continuing to streamline our operating cost structure and related cash outlays, such that our funds can be spend on drilling and acquisition of oil and gas properties, giving us expected returns on investment.”

Alpharetta, Ga.-based Legend Oil is a managed risk, oil and gas exploration/exploitation, development and production company with a current focus on leases in southeastern Kansas.

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