Sound Oil is pleased to announce signature of the Reserve Based Lending facility for the Nervesa discovery which was previously announced on 23 September 2014.
The Company is pleased to confirm signature of a Euro 7 million, 24 month bullet loan issued at par with a 5% coupon (the "Loan"). The Loan is provided by Greenberry S.A. (Greenberry), an affiliate of Continental Investment Partners S.A. (Continental), Sound Oil's cornerstone investor. The Loan is secured upon the Carita permit (which holds the Nervesa discovery) and after award of the first Nervesa production concession, expected during 2015, will be without recourse to the Company.
In addition the Company has conservatively decided to ringfence 50% of the free cash flows from Rapagano and Nervesa for the 24 month period of the Loan. This cash pool will then be applied towards the settlement of the Loan.