Horizon Petroleum arranges $1.2M debenture financing

Executive Summary

• Horizon Petroleum Ltd. announced a private placement of secured convertible debentures with an aggregate principal amount of up to $1.2 million.
• The proceeds are designated to fund the final payments for long-lead items and civil works for the re-entry of the Lachowice 7 gas well, as well as to provide working capital for general corporate purposes in Poland and Canada.
• The debentures carry a 7% interest rate, mature 24 months after closing, and are convertible into company units at a price of 10 cents per unit.

Key Details

• Financing Structure: Private placement of secured convertible debentures.
• Principal Amount: Up to $1.2 million.
• Price: $1,000 per debenture.
• Security Ranking: Secured, ranking in third position on default behind Series 1 debentures (due May 20, 2026) and other convertible debentures (due Dec. 19, 2027; Dec. 29, 2027; and Feb. 27, 2028).
• Interest Rate: 7% per annum from the issuance date.
• Maturity/Term: 24 months following the closing date.
• Anticipated Closing Date: March 31, 2026.
• Conversion Terms:
  • Convertible into units at the holder's option prior to the last business day preceding maturity.
  • Conversion Price: 10 cents per unit (subject to adjustment).
  • Unit Composition: One common share and one-half of one common share purchase warrant.
  • Warrant Exercise Price: 15 cents per common share.
  • Warrant Expiry: 36 months from the debenture closing date.
• Use of Proceeds: Final payments for long-lead items and civil works for the planned re-entry of the Lachowice 7 gas well; working capital for general corporate purposes in Poland and Canada.
• Related Party Transaction: Certain directors and officers are expected to participate. The offering is exempt from formal valuation and minority approval requirements of MI 61-101 due to insider participation.
• Regulatory Approval: Subject to approval of the TSX Venture Exchange (TSX-V).
• Finder’s Fees: Up to 7% in cash and 7% in warrants.
• Hold Period: All securities subject to a statutory four-month hold period.

Notable Quotes

• "The proceeds will pay the final payments for long-lead items and civil works for the planned re-entry of the Lachowice 7 gas well and provide working capital for general corporate purposes in Poland and in Canada." — David Winter, Chief Executive Officer