Calfrac arranges $35-million rights offering

Executive Summary

• Calfrac Well Services Ltd. is launching a $35-million rights offering to raise capital for the redemption of approximately $120-million in outstanding second-lien secured notes due in 2026.
• The offering is fully backstopped by existing directors and shareholders, including EdgePoint Investment Group Inc., ensuring the full $35-million is raised.
• Proceeds will be combined with draws from existing credit facilities to repay the second-lien notes, aiming to reduce long-term debt and lower cash interest expenses.

Key Details

• Rights Offering Structure:
  • Gross Proceeds: $35-million.
  • Subscription Price: $2.69 per whole common share.
  • Subscription Ratio: One transferable right for each common share held on the record date (Nov 21, 2025). Each right entitles the holder to subscribe for 0.1514872 of a common share (approx. 6.6 rights per share).
  • Discount: The subscription price represents a 15% discount to the 5-day volume-weighted average trading price on the TSX.
  • Expiry: Rights expire at 5 p.m. Toronto time on Dec 19, 2025.
  • Trading: Rights listed on TSX under symbol CFW.RT, trading commences Nov 21, 2025, and ends at 12 p.m. on the expiry date.
• Use of Proceeds & Debt Refinancing:
  • Primary Goal: Repay outstanding 10.875% second-lien secured notes issued by Calfrac Holdings LP.
  • Note Redemption: Aggregate principal amount of notes is approx. $120,000,100 (USD). Redemption price is 100% of principal plus accrued/unpaid interest.
  • Additional Funding: Company expects to draw up to $15-million from existing syndicated or operating facilities.
  • Term Loan: Completion of rights offering allows company to draw on an available $120-million term loan.
• Standby Purchase Agreement:
  • Backstopers: George Armoyan, Ronald P. Mathison, Charles Pellerin, EdgePoint Investment Group Inc., and Brian Luborsky.
  • Terms: Backstopers agree to exercise their basic subscription privileges and purchase any unsubscribed shares on a pro-rata basis to ensure the full $35-million is raised.
  • Fees: No fees payable to standby purchasers.
  • Related Party Status: Armoyan, Mathison, and Pellerin are directors; Armoyan and Mathison control >10% of shares. Transaction exempt from MI 61-101 valuation/approval requirements under Section 5.1(k).
• Timeline:
  • Record Date: Nov 21, 2025.
  • Anticipated Completion/Redemption: On or about Dec 23, 2025.
• Conditions: Subject to regulatory approvals, including final acceptance by the TSX.

Notable Quotes

• Mike Olinek, CFO: "In addition to addressing Calfrac's near-term debt maturities and expanding the lending syndicate to include an additional Tier 1 bank, this refinancing plan aligns with Calfrac's financial priorities of continued debt reduction and lowering cash interest expense. When combined with our strong operating results and the expectation for a sizable decrease in capital spending during 2026, the company anticipates significantly lowering its long-term debt and borrowing costs on a year-over-year basis."