Iona Energy Inc.
TSX VENTURE : INA

Iona Energy Inc.

March 12, 2015 09:32 ET

Iona Energy Inc.: Bondholder Meeting Summons

CALGARY, ALBERTA--(Marketwired - March 12, 2015) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR DISSEMINATION IN UNITED STATES

Iona Energy Inc. ("Iona" or the "Company") (TSX VENTURE:INA), a Canadian independent oil and gas company with assets in the UK North Sea provides the following update.

Bondholder Meeting Summons

On September 27, 2013, Iona, via its UK subsidiary Iona Energy Company (UK) plc (the "Issuer"), issued US$275 million in senior secured bonds (the "Bonds"). The Issuer today published a summons to a bondholder meeting (the "Summons") proposing to the bondholders a range of amendments to its bond agreement including:

  • Full waiver of financial covenants through to first oil at Orlando including net debt / EBITDA and minimum capitalization ratios
  • Conversion of interest payments to payment-in-kind (i.e. added to principal, therefore non-cash) for 2015 and 2016
  • Scheduled 2016 amortization payments (US$85 million in aggregate) deferred until bond maturity in September 2018
  • Company to conduct a review process to work through a number of alternatives to ensure the business is fully funded to first oil at Orlando. The review will result in a proposal being made to bondholders for their approval by end June 2015
  • New independent director to be appointed to the Board of Iona, which is anticipated to be reduced to not more than six directors
  • Bondholders to receive a fee in the form of non-transferable warrants to purchase common shares of Iona (the "Bonus Warrants") representing in aggregate 10% of the existing common shares of Iona. The Bonus Warrants shall have an exercise price of C$0.05 per warrant. The warrants shall be exercisable until September 27, 2018 and will be subject to a hold period of four months and a day from issuance

The full details of the proposed amendments can be found in the Summons published today. To assist reading of this document the Company has prepared a short presentation which summarizes the main points included in the Summons. Both the Summons and the presentation can be found on the Company's website at www.ionaenergy.com

A bondholder meeting is scheduled for March 27, 2015 to approve the amendments. Iona has secured pre-acceptances to vote in favour of the proposed amendments from bondholders representing over 40% of the outstanding Bonds. To approve the resolution put to the meeting, bondholders representing at least 2/3rds of the Bonds represented in person or by proxy at the meeting must vote in favour of the resolution.

Issuance of the Bonus Warrants remains subject to approval of the TSX Venture Exchange.

Tom Reynolds, Chief Executive Officer, commented:

"This is a very positive step forward following proactive engagement with bondholders initiated by the management team to protect value for all our stakeholders. The proposed amendments provide Iona with significant additional financial flexibility with a total of up to US$135 million of scheduled interest and amortization payments deferred. The amendments provide a strong foundation for the management team to execute its strategy which includes delivering first production from the Orlando project."

Conference Call

Tom Reynolds, CEO will be hosting a conference call for investors and analysts today at 14.00GMT (London) / 07.00MDT (Calgary) / 09.00ET (Toronto). To join the call please dial in 5-10 minutes prior to the start time using the information below.

Dial in details:

UK Toll-Free Number: 0808 237 0030
Canada: +1 866 404 5783
USA: +1 866 928 7517
Participant Pin Code: 10396969#

Additional information relating to the Company is available on SEDAR at www.sedar.com.

Camarco is a financial public relations group assisting the Company with this press release.

About Iona Energy:

Iona is an oil and gas company with assets in the United Kingdom's North Sea.

Forward-Looking Statements

Some of the statements in this announcement are forward-looking, including statements regarding anticipated amendments to the Bonds, related changes in Iona's business and the anticipated timing thereof. When used in this announcement, the words "expects," "believes," "anticipate," "plans," "may," "will," "should", "scheduled", "targeted", "estimated" and similar expressions, and the negatives thereof, are intended to identify forward-looking statements. Such statements are not promises or guarantees, are based on various assumptions by Iona's management, including the anticipated effects of the amendments on Iona's business, and are subject to risks and uncertainties that could cause actual outcomes to differ materially from those suggested by any such statements, including without limitation: the risk that the Bond amendments are not approved by the bondholders or are delayed for any reason, and the risk that the TSX Venture Exchange does not grant approval for the issuance of Bonus Warrants.

Neither the TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Iona Energy Inc.
    Tom Reynolds, CEO
    Robert Gair, CFO
    +44 (0) 1224 228400
    info@ionaenergy.com

    Camarco
    Billy Clegg / Georgia Mann
    +44 (0) 20 3757 4980