April 03, 2014
Osage Exploration and Development Announces $30 Million Refinancing with Apollo Investment Corp.
SAN DIEGO, CALIFORNIA, April 3, 2014 - Osage Exploration and Development, Inc. (OTCBB:OEDV), an independent exploration and production company focused on the Horizontal Mississippian and Woodford plays in Oklahoma, announced today that the Company has entered into a new $30 million draw-down credit facility with Apollo Investment Corporation ("Apollo"). This agreement refinances Osage's existing $20 million credit facility and provides an additional $10 million of liquidity at an overall interest rate approximately 25% lower than Osage's previous credit facility with Apollo.
Further, all loan covenants that previously applied have been reset, and Osage's cost of capital on the entire $30 million facility has decreased to LIBOR plus 11% as opposed to the previous rate of LIBOR plus 15%. No additional warrants or equity of any kind was issued by the Company in connection with this refinancing.
Management Comments
"Osage was fortunate enough to receive the early financial support of Apollo while we were still in the infancy of our Mississippian and Woodford project. Now we are intent on achieving much greater growth in production, and we are still doing so with the full confidence and support of Apollo.
"We feel the ability to simultaneously increase our borrowings with a correspondingly reduced interest rate underscores Apollo's commitment to grow with us as we move aggressively forward in our current operating mode. Our goal to keep one rig running continuously in Logan County and to begin drilling our Pawnee County and Coal County projects with a second rig is absolutely within our reach this year.
"This additional capital will enable us to demonstrate the true potential of these three projects, which will unlock tremendous value for Osage. This is the time that Osage shareholders have been waiting for," stated Kim Bradford, Chairman and CEO.
About Osage Exploration and Development, Inc.
Based in San Diego, California, with production offices in Oklahoma City, Oklahoma, Osage Exploration and Development, Inc. is an independent exploration and production company with interests in oil and gas wells and prospects in the U.S. osageexploration.com
About Apollo Investment Corporation
Apollo Investment Corporation ("AIC", NASDAQ: AINV) is a leading provider of subordinated debt and equity capital to middle-market companies. We generate both current income and capital appreciation through debt and equity investments. AIC is managed by Apollo Investment Management and its corporate governance is provided by an independent board of directors. The company is registered with the SEC as a business development company under the Investment Company Act of 1940, which provides the company with structural advantages, including public liquidity and an advantageous tax structure. Our portfolio is comprised primarily of investments in subordinated loans and senior secured loans of private middle-market companies with equity interests such as warrants or equity co-investments. The value of our portfolio is determined by independent, third-party firms. Within the energy space, AIC is focused on $20 million to $200 million investments in oil and gas producers, oilfield service providers, midstream and alternative energy companies. apolloic.com
Safe Harbor Statement
The information in this release includes certain forward-looking statements as defined by the Securities and Exchange Commission that are based on assumptions that in the future may prove not to have been accurate. Those statements and Osage Exploration and Development, Inc. are subject to a number of risks, including production variances from expectations, volatility of product prices, inability to raise sufficient capital to fund its operations, environmental risks, competition, government regulation, and the ability of the Company to execute its business strategy, among others.
Contacts
Osage Exploration and Development, Inc.
Jack Zedlitz, VP of Corporate Development
Phone: 405-270-0989
jzedlitz@osageexploration.com
Kim Bradford, President and CEO
Phone: 619-677-3956
kbradford@osageexploration.com
osageexploration.com.
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This is very good news. They now have the money they need for their drilling program (most of it), they have removed doubt raised by the loan covenants with Apollo, and they have significantly reduced their financing cost. Very good indeed. |
