Energy & Exploration Partners Inc. (ENXP) plans to offer $375 million in aggregate principal amount of convertible subordinated notes due 2019. Holders of the notes will have the option to elect to convert their notes into shares of ENXP's common stock upon the closing of the first qualified, registered public offering of ENXP's common stock.
ENXP will have the right to redeem the notes that are not converted at a redemption price equal to 100% of the principal amount of the notes plus accrued and unpaid interest. The notes will be subordinated in right of payment to all of ENXP's senior indebtedness.
ENXP intends to use the net proceeds from the offering, together with borrowings under a senior secured term loan that ENXP intends to enter into in conjunction with the closing of the notes offering, to pay the purchase price for ENXP's recently announced acquisition of oil and gas assets from TreadStone Energy Partners LLC, refinance and replace ENXP's outstanding senior unsecured notes, and fund a portion of its 2014 and 2015 capital expenditure budget.