American International Petroleum Completes $10 Million Debt FinancingNEW YORK--(BUSINESS WIRE)--Feb. 18, 1999--American InternationalPetroleum Corporation (NASDAQ-NMS:AIPN) announced today it hascompleted the private placement of $10 million of 5% redeemablesecured Debentures, due February 2004, with a fund advised by ThePalladin Group, L.P.
Proceeds of the financing will be used to pay variousobligations,including $3.5 million of the Company's outstanding convertible notes,leaving a principle balance of $2.9 million of notes.
Chairman and CEO Dr. George Faris said, "We are very pleased thatthe Company has been able to complete this financing, particularly atthis difficult time for our industry, and to work with aninstitutional investor who shares our vision of growth. In addition torepaying a majority of the Company's outstanding notes, the financingwill allow our refining operations to accelerate their business planand fulfill our exploration and development group's obligations inKazakhstan." Over the next several months the Company, working in conjunctionwith its outside financial advisors, will seek to arrange long termconventional financing in order to redeem both new and old outstandingdebentures, accelerate exploration and development activities inKazakhstan, expand refinery operations and augment working capital.
The Debentures are secured by a first mortgage on the Company'sLake Charles, Louisiana refinery and property. The Debentures may notbe converted into common stock of the Company before July 18, 1999,unless certain minimum above current market price criteria for theCompany's common stock are met, including a restriction on sales basedupon the percentage of trading volume in its stock. After July 18,1999, should the Debentures not have been redeemed, they may beconverted into common stock of the Company under certain conditionsand restrictions at a variable price determined by reference to themarket price.
Additionally, the Company intends to withdraw its registrationstatement filed in July 1998, with the Securities and ExchangeCommission for a $40 million equity line financing with HP Partners.
American International Petroleum Corporation is a diversifiedpetroleum company which, through various wholly owned subsidiaries, isinvolved in oil and gas exploration and development in the Republic ofKazakhstan, and in refining, marketing and transportation of itsrefined products in the United States.
The matters discussed herein are forward-looking statements.These statements involve risks and uncertainties, such as timelyavailability of products and services, as set forth in the Company'sfiling with the Securities and Exchange Commission. These risks anduncertainties could cause actual results to differ materially from anyforward-looking statements made herein. --30--tia/ny* CONTACT: American International Petroleum, New York
Michael Dodge, 212/688-3333
www.aipcorp.com
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