Greenfire Resources' Announces Expiration and Results of Change of Control Offer for Senior Secured Notes Due 2028

Rhea-AI Summary

Greenfire Resources (NYSE: GFR) (TSX: GFR) announced the expiration of its change of control offer to purchase its outstanding 12.000% Senior Secured Notes Due 2028. The offer, which expired on February 19, 2025, resulted in only $5,000 in aggregate principal amount of Notes being validly tendered.

The offer was triggered by Waterous Energy Fund's acquisition of additional shares on December 23, 2024, increasing its ownership to 56.5% of Greenfire's outstanding common shares. Under the indenture terms, Greenfire was required to offer to purchase the Notes at 101% of their principal amount, plus accrued and unpaid interest. Settlement of the tendered Notes is scheduled for February 24, 2025.

Positive

• Minimal noteholder participation in the change of control offer ($5,000) indicates strong confidence in the company post-acquisition
• Successful completion of mandatory change of control offer requirements

Negative

• 12% interest rate on Senior Secured Notes indicates relatively high cost of debt

Insights

Fixed Income Analyst

The minimal response to Greenfire Resources' change of control offer provides several key insights into both investor confidence and market dynamics. With only $5,000 in notes tendered out of the total outstanding, noteholders have effectively voted with their wallets to maintain their positions, despite being offered a 1% premium.

The 12% coupon rate on these senior secured notes is particularly noteworthy in the current market environment. This high yield reflects both the risk profile of the energy sector and the security features of the notes. The overwhelming decision by noteholders to retain their positions suggests they view this yield as attractive and are comfortable with Waterous Energy Fund's increased control to 56.5%.

Waterous Energy Fund's reputation in the energy sector and their majority stake acquisition brings several strategic advantages:

• Enhanced financial backing and operational expertise
• Stronger corporate governance framework
• Potential for operational synergies and cost optimizations

The 2028 maturity provides a stable long-term debt structure, while the senior secured status offers noteholders substantial protection. The minimal tender response indicates noteholders' confidence in both the company's ability to service this debt and the potential for value appreciation under the new ownership structure.

Calgary, Alberta--(Newsfile Corp. - February 20, 2025) - Greenfire Resources Ltd. (NYSE: GFR) (TSX: GFR) (“Greenfire” or the “Company”) today announced that the change of control offer made by Greenfire to purchase any and all of its outstanding 12.000% Senior Secured Notes Due 2028 (the “Notes”) expired at 5:00 pm, New York City Time, on February 19, 2025. Greenfire did not extend the offer.

As of the expiration of the offer, a total of $5,000 in aggregate principal amount of the Notes had been validly tendered and not withdrawn. Greenfire has accepted all validly tendered Notes for purchase, and settlement of the tendered Notes will occur on February 24, 2025 or as soon as practicable thereafter. The Notes were originally issued by Greenfire pursuant to an indenture dated as of September 20, 2023 (the “Indenture”).

On December 23, 2024, Waterous Energy Fund acquired shares to increase its interest in Greenfire to 56.5% of the issued and outstanding common shares of Greenfire (the “Acquisition”). Under the terms of the Indenture, Greenfire was required to make an offer to purchase the Notes at a price equal to 101% of the aggregate principal amount of the Notes repurchased, plus accrued and unpaid interest to, but not including, the date the Notes are purchased by Greenfire, following the “Change of Control Offer” (as defined in the Indenture), which occurred on December 27, 2024 as a result of the Acquisition.

The complete terms and conditions of the offer were set forth in the Notice of Change of Control and Offer to Purchase dated December 27, 2024 (the “Offer to Purchase”), which were transmitted to holders of the Notes through the facilities of the Depository Trust Company.

About Greenfire

Greenfire is a junior oil sands producer actively developing its long-life and low-decline thermal oil assets in the Athabasca region of Alberta, Canada. The Company plans to leverage its large resource base and significant infrastructure in place to drive meaningful, capital-efficient production growth. Greenfire common shares are listed on the New York Stock Exchange and Toronto Stock Exchange under the symbol "GFR". For more information, visit greenfireres.com or find Greenfire on LinkedIn and X.

Contact Information

Greenfire Resources Ltd.
205 5th Avenue SW
Suite 1900
Calgary, AB T2P 2V7
investors@greenfireres.com
greenfireres.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/241546

FAQ

How many Greenfire Resources (GFR) notes were tendered in the change of control offer?

Only $5,000 in aggregate principal amount of notes were validly tendered in the change of control offer that expired on February 19, 2025.

What percentage stake does Waterous Energy Fund now own in Greenfire Resources (GFR)?

Waterous Energy Fund increased its ownership to 56.5% of Greenfire's outstanding common shares on December 23, 2024.

What was the purchase price offered for GFR's Senior Secured Notes in the change of control offer?

Greenfire offered to purchase the notes at 101% of their principal amount, plus accrued and unpaid interest.

When will Greenfire Resources (GFR) settle the tendered notes from the change of control offer?

Settlement of the tendered notes is scheduled for February 24, 2025 or as soon as practicable thereafter.