Jericho Oil Announces New Joint $30 Million Credit Facility
TULSA, OK, and VANCOUVER, BC, August 3, 2016 – Jericho Oil Corporation (“Jericho”) (TSX-V: JCO; OTC: JROOF) announces that, in conjunction with its private family partner, it has entered into a USD$30 million Senior Secured Revolving Credit Facility (the “Facility”) with East West Bancorp, Inc. (NASDAQ: EWBC) as the sole arranger. The initial borrowing base has been set at $10 million. The Facility is available for working capital requirements,
capital expenditures, acquisitions, general corporate purposes, and to support letters of credit.
The Facility will bear interest at a rate of WSJ Prime (currently 3.50%) plus 75 basis points and will be payable monthly. The interest rate will be fixed at 4.25% for the first six months of the Facility. The Facility, subject to customary financial covenant tests, matures on July 29, 2018 and will be subject to semi-annual re-determinations and will be secured by a first lien on substantially all of the Company’s assets.
“We welcome our new relationship with East West, a Tier 1 bank with a talented, veteran energy team,” said Allen Wilson, CEO of Jericho Oil. “Their approval of the Facility and the favorability of their terms is a testament to our clean balance sheet and the quality of our existing portfolio of assets, and allows us to accelerate our roll-up of undervalued, high quality Central Oklahoma oil and gas assets. Until now, we have financed our acquisitions and property development exclusively through the strong support of our equity shareholders and today marks an exciting step forward in positioning our capital structure to support further growth and opportunities.”
In connection with and subject to the new Facility, Jericho has also entered into commodity hedging contracts to strengthen and protect the Company’s cash flows, while maintaining optimal upside, covering 75% of forecasted engineered oil and natural gas volumes for the term of the Facility. The following table presents the Partnership’s open commodity oil and natural gas derivatives positions as of August 1, 2016:
About Jericho Oil Corporation
Jericho is a growth-oriented oil and gas company engaged in the acquisition, exploration, development and production of overlooked and undervalued oil properties in the Mid-Continent. For more information, please visit http://www.jerichooil.com.
About East West
East West Bancorp, Inc. is a publicly owned company with total assets of $33.0 billion and is traded on the Nasdaq Global Select Market under the symbol “EWBC”. The Company’s wholly owned subsidiary, East West Bank, is one of the largest independent banks headquartered in California with a market capitalization near $5 billion. For more information, please visit http://www.eastwestbank.com
Cautionary Note Regarding Forward-Looking Statements: This news release includes certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and Canadian securities laws. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual events and results to differ materially from Jericho’s expectations include risks related to the exploration stage of Jericho’s project; market fluctuations in prices for securities of exploration stage companies; and uncertainties about the availability of additional financing.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Director, Investor Relations
Director, Corporate Communications