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CALGARY, March 25 /CNW/ - Bellatrix Exploration Ltd. ("Bellatrix" or the "Company") (BXE-TSX) is pleased to announce that it has entered into an agreement with a syndicate of underwriters led by National Bank Financial Inc. and including Wellington West Capital Markets Inc., Genuity Capital Markets, and Macquarie Capital Markets Canada Ltd. to issue (the "Offering") on a bought deal basis, $55 million of 4.75% Convertible Unsecured Subordinated Debentures due April 30, 2015 (the "Debentures"). Bellatrix has also granted the underwriters an option (the "Over-Allotment Option") to purchase up to an additional $5.5 million principal amount of Debentures exercisable in whole or in part for a period of 30 days following the closing of the Offering.
Subject to closing of the Offering, Bellatrix intends to give notice on or following with the closing date of the Offering of its intention to redeem its currently outstanding approximately $84.9 million 7.50% Convertible Unsecured Subordinated Debentures due June 30, 2011 (the "Existing Debentures"). The Existing Debentures are redeemable for an amount of $1,050 for each $1,000 principal amount of the Existing Debentures plus accrued unpaid interest if redeemed on or prior to June 30, 2010 or an amount of $1,025 for each $1,000 principal amount of the Existing Debentures plus accrued unpaid interest if redeemed after June 30, 2010. A determination as to the redemption date will be made prior to closing of the Offering. Proceeds from the Offering will be used by Bellatrix to partially fund the redemption of the Existing Debenture and the balance of the redemption amount is intended to be funded through bank indebtedness.
The Debentures will bear interest from the date of issue at 4.75% per annum, payable semi-annually in arrears on April 30 and October 31 of each year commencing April 30, 2010. The Debentures will have a maturity date of April 30, 2015 (the "Maturity Date").
The Debentures will be convertible at the holder's option into common shares ("Common Shares") of the Company at a conversion price of $5.60 per Common Share (the "Conversion Price"), subject to adjustment in certain events.
The Debentures will not be redeemable before April 30, 2013. On and after April 30, 2013 and prior to April 30, 2014, the Debentures will be redeemable at the Company's option, in whole or in part, at par plus accrued unpaid interest if the weighted average trading price of the Common Shares for the specified period is not less than 125% of the Conversion Price. After April 30, 2014, the Debentures will be redeemable at the Company's option, in whole or in part, at any time at par plus accrued and unpaid interest.
Bellatrix will file a preliminary short form prospectus relating to the issuance of the Debentures with securities commissions in each of the provinces of Canada other than Quebec. Closing is expected to occur on or about April 20, 2010 and is subject to certain conditions including, but not limited to, receipt of all the necessary approvals including the approval of the Toronto Stock Exchange.
Bellatrix Exploration Ltd. is a growth oriented exploration and production company based in Calgary, Alberta, Canada.
The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
ADVISORY: This press release contains forward looking statements. More particularly, this press release contains statements concerning the anticipated closing date of the offering, the anticipated use of the net proceeds of the offering and the intended plans with respect to the redemption of the Existing Debentures. Although Bellatrix believes that the expectations reflected in these forward looking statements are reasonable, undue reliance should not be placed on them because Bellatrix can give no assurance that they will prove to be correct. Since forward looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. The closing of the offering could be delayed if Bellatrix is not able to obtain the necessary regulatory and stock exchange approvals on the timelines it has planned. The offering will not be completed at all if these approvals are not obtained or some other condition to the closing is not satisfied. Accordingly, there is a risk that the offering will not be completed within the anticipated time or at all. The intended use of the net proceeds of the offering by Bellatrix and Bellatrix's plans with respect to the redemption of the Existing Debentures may change if the board of directors of Bellatrix determines that it would be in the best interests of Bellatrix to proceed in a different manner. The forward looking statements contained in this press release are made as of the date hereof and Bellatrix undertakes no obligations to update publicly or revise any forward looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.