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Zargon Oil & Gas Ltd ZARFF

Energy Oil & Gas E&P
Zargon Oil & Gas Ltd is a producer of oil and gas. It is engaged in the exploration, development, and production of oil and natural gas in Canada and the United States. The company works on three phases of oil reservoir exploitation which include Primary recovery, Waterflood recovery, and Tertiary recovery. Its portfolio includes Alberta plains north, Alberta plains south and Williston basin projects.


GREY:ZARFF - Post by User

Zargon Oil & Gas Ltd > ZAR's US financing
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Comment by pablo87on Nov 04, 2018 8:11pm
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Post# 28922335

RE:RE:RE:RE:RE:ZAR's US financing

RE:RE:RE:RE:RE:ZAR's US financingYes this is the most likely scenario IMO.  But there are other scenarios of course.

Please understand that these debentures are not "debt" in the traditional sense.

This was a financial vehicle (read many of these indentures, legal language almost identical) created by the big banks to offload the debt owed to them by o&g's. Offload to whom you ask? Well their own clients of course!

In the process, they subordinated the debentures to unsecured creditors and gave the company the option to convert the debt into shares at the end of the term (in case they didn't have the money to pay back investors).  

From day 1, debentureholders were always one corporate move away from becoming shareholders at the end of the term, whether they realized it or not. 

The other part of the equation of course is the dilutive effect on shareholders, whether THEY realized it or not.  

Just a poorly thought out financial instrument that lacks transparency and creates uncertainty.
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