(Energy Analytics Institute, Ian Silverman, 12.Jun.2018) – Frontera Energy Corporation entered into an unsecured loan agreement with Puerto Bahia.
The agreement is pursuant to which Frontera has agreed to loan an aggregate amount of $30.46 million to Puerto Bahia, subject to certain terms and conditions. The loan bears an annual interest rate of 14% and will mature on May 31, 2019.
Puerto Bahia is a private company organized and existing under the laws of Colombia that is responsible for the design, construction, ownership, operation and maintenance of a large-scale multi-purpose port facility located in the Cartagena Bay in Colombia.
On October 4, 2013, Pacinfra Holding Ltd., a wholly-owned subsidiary of the Company, Pacific Infrastructure Inc., an entity in which Frontera indirectly owns a 39.22% interest, Puerto Bahia, a wholly-owned subsidiary of Pacific Infrastructure, and Wilmington Trust, National Association (as administrative agent) entered into an equity contribution agreement pursuant to which Pacinfra Holding and Pacific Infrastructure agreed to both jointly and severally cause equity or debt contributions to be made to Puerto Bahia up to an aggregate amount of $130 million in circumstances where it is determined that there were certain deficiencies related to operation and maintenance of the a multi-purpose port facility developed by Puerto Bahia and Puerto Bahia’s ability to make payments towards its bank debt obligations.
In accordance with the equity contribution agreement, a deficiency notice to Pacinfra Holding was issued requesting the company fund, or cause to be funded, a total amount of $30.46 million to Puerto Bahia, due May 31, 2018. The loan agreement was entered into to satisfy this funding commitment.
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