Pieridae Energy Ltd T.PEA

RE: $$ Long Term Debt

[commonsense9]

A year ago, PEA and Third Eye Capital would have had nothing to fight over. Anyway...

• PEA cannot possibly pay the debt when due in full next year.
• The whole Alberta gas operation is security for the loan. So theoretically TEC could take possession, get rid of non-operational management, and effectively dispossess shareholders of all value.
• For a lot of reasons that is not going to happen. But the theorectical/legal power matters.
• So TEC and PEA negotiate what will happen. I dont even have a guess where that will land.

Except to say generally, that TEC is going to end up with a lot more shares (they are already the largest shareholder by far). Even if PEA is making money, holding is not the TEC game, but PEA is such a funny animal that there are not a lot of options for TEC.
Since like it or not they are going to be holders of the value, they have nothing to gain by stalling. But its another negotiating chip that they are due the 15% interest for over another year and a half. So when they agree to more reasonable interest- they get another pound of flesh for that.

The fact hat there is value and no one wants to kill the goose- that doesnt get you a deal.

1rockit wrote: With the price of nat gas where it is, one would think that the company could get a better deal on long term debt. All of the sudden their debt isn't looking so risky. You'd think they'd be able to at least cut their obligations of 20% interest on their debt to at least half that . I could definitely see some stock price appreciation because I this.. Just another angle that this company is a better buy than ITE . Another reason is the 40 thous barrels P/D Equivalent.

[commonsense9]

When TEC cut this deal, they would make out like bandits if the LNG project went through. But they had to have known that if it did not- it was questionable how much of their loan they could recover. (Only shareholders were under illusions the Shell gas operations were inherently profitable, at the price futures people expected then.) And then there is the kicker of the operating licences PEA

[ppp]

Like you say TEC owns 25 mil shares or so, so why would they kill kill the goose that lays the golden eggs. IMO PEA just needs to continue paying it off till term and refinance at that time, work out a deal on the 125 mil remaining and carry on. IMO TEC will have made 50 mil on their shares as I would think the share price should be well over 3 dollars. by then.