debenture news and update-so debenture is rolled over for 2 years and debenture holders have agreed to take common shares vs cash. I would say that is pretty positive. Yes the debt still sits on the balance sheet, but with the extension out 2 full years, gives the company the runway to execute. Bottomline is the debenture holders are fully onboard and are clearly believers and working with and backing the company.
-Operations in Wyoming are 'reaching a 5-year high during 4th quarter'...pretty good considering the state of the industry. Sounds like Wyoming is picking up business from those that arent able to weather the current environment.
-New linear motor goes in sometime in January based on clients schedule.
GLTA C1
Divergent Energy extends 10% debentures to 2017 2015-12-22 09:17 ET - News Release
Mr. Ken Berg reports
DIVERGENT ENERGY SERVICES ANNOUNCES AMENDMENTS TO 10% SECURED DEBENTURES AND OPERATING UPDATE
Subject to the final approval of the TSX Venture Exchange and pursuant to the terms of the debenture indenture, as amended, Divergent Energy Services Corp. has amended the terms of its previously issued 10-per-cent secured, subordinated debentures. The terms of the debentures were amended to: (i) extend the maturity date of the debentures to Dec. 31, 2017; (ii) provide Divergent with the ability, at its discretion, to pay any interest obligation that becomes due by the issuing of common shares of the corporation; (iii) allow for the partial redemption of the outstanding debentures at the discretion of the corporation; and (iv) remove all references in the indenture to CDN Oilfield Technologies & Solutions S de RL de CV, a direct, wholly owned subsidiary of the corporation as a guarantor and removing any reference to any security interest over CDN Mexico's present and after-acquired real and personal property.
The amendments were approved by an extraordinary resolution of the holders of the debentures, effective Dec. 18, 2015, and Divergent will enter into a supplemental indenture with Computershare Trust Company of Canada, as debenture trustee, to reflect the amendments.
Pursuant to its right referenced above, the corporation has elected to satisfy an interest obligation in the amount of $144,932 due on Dec. 31, 2015, by the issue of 579,728 common shares at a deemed price of 25 cents per common share to the debentureholders. Of the common shares that will be issued to satisfy the interest obligation, 13,108 common shares will be issued to directors and/or officers of the corporation.
In consideration for the debentureholders approving the amendments, the corporation has agreed, subject to the final approval of the TSX-V, to issue to each debentureholder an additional 500 common share purchase warrants for each $1,000 principal amount of debentures held by such debentureholder, for a total of 2,875,000 additional warrants. Each additional warrant entitles the holder thereof to purchase one common share in the capital of the corporation at an exercise price of 24 cents on or before Dec. 31, 2017. Of the additional warrants being issued, 65,000 additional warrants will be issued to directors and/or officers of the corporation.
Operating update
Securing the amendments provides Divergent with enhanced financial flexibility as the corporation continues to advance development of its revolutionary linear electric submersible pump. The first of these linear pumps is expected to be installed in a well in southeast Saskatchewan by one of Divergent's oil and gas producer clients early in 2016, following the resumption of full operations after the holiday season. Divergent is in discussions with other oil and gas operators regarding additional installations at sites in Canada and the United States, which would be anticipated following the successful deployment of this linear pump in Saskatchewan.
The corporation's Wyoming-based electric submersible pump operation continues to exceed expectations and internal estimates, with activity levels reaching a five-year high during the fourth quarter of 2015. This growth is a clear demonstration of Divergent's ability to exceed client expectations for its products and services, with continued market expansion anticipated as industry activity increases within the Powder River basin.
We seek Safe Harbor.