CGX Energy Announces US$2.5 Million Loan Agreement

Executive Summary

• CGX Energy’s subsidiary, CGX Resources Inc., entered into a US$2.5 million senior secured loan facility with Frontera Energy Corporation (via a Frontera subsidiary).
• The loan is non‑revolving, available for drawdown in tranches up to US$1.9 million per tranche, with total commitments not to exceed US$2.5 million, and carries interest at 19.32% per annum (monthly compounding).
• Funds will be used to finance CGX’s share of corporate working‑capital costs and other budgeted expenses related to its joint‑venture activities in the Corentyne block offshore Guyana.

Key Details

• Loan Amount: US$2.5 million senior secured facility.
• Lender: Frontera Energy Corporation (TSX: FEC) – through a Frontera subsidiary.
• Borrower: CGX Resources Inc., wholly‑owned subsidiary of CGX Energy Inc. (TSXV: OYL).
• Drawdown Structure:
• Non‑revolving facility for a six‑month drawdown period starting upon satisfaction of conditions precedent to the first tranche.
• Maximum per‑tranche drawdown: US$1,900,000.
• Aggregate drawdowns may not exceed US$2,500,000.
• Interest Rate: 19.32% per annum, compounded monthly.
• Maturity: Principal and accrued interest payable one (1) year after the loan date.
• Purpose of Funds: Finance CGX’s share of corporate working‑capital costs and other budgeted expenditures tied to the Corentyne block joint venture.
• Regulatory Conditions: Subject to customary conditions, including required regulatory approvals.
• Related‑Party Transaction: The loan is a related‑party transaction under Multilateral Instrument 61‑101 but is exempt from formal valuation and minority shareholder approval requirements; a material change report will disclose the exemption details.

Notable Quotes

(No executive quotes were included in the release.)