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| Seven Seas Announces Allocation Between Series A Notes and Warrants |
HOUSTON, Feb. 15 /PRNewswire-FirstCall/ -- Seven Seas Petroleum Inc. (Amex: SEV) announced the allocation of the issue price between the Series A Senior Secured Notes and Warrants that were issued as a part of the rights offering to shareholders in December 2001. On December 14, 2001, the Company issued, at a purchase price of $104.75, units comprised of a $100 Series A Senior Secured Note and a Warrant to purchase approximately 56 shares of common stock at an exercise price of about $1.78 per share. As previously disclosed in U.S. Securities and Exchange Commission (SEC) filings, all of these warrants have an anti-dilution clause that would require the Company to reset the warrant exercise price in the event the Company issued common stock at a price less than $1.78 per share. This event would trigger the reset of the warrant exercise price below $1.78 per share. Additional information on this matter can be found by reviewing the Master Warrant Agreement and the Chesapeake Warrant, which were filed as exhibits to the Company's registration statement on Form S-2 for the rights issue. An independent business valuation firm contracted by the Company recently issued a report on the fair market value of the Series A Notes and Warrants at the time of issuance. Based on this fair market valuation, the allocation of the $104.75 issue price of the unit is 95.13% to the Series A Note and 4.87% to the Warrant. The Company expects to list on the American Stock Exchange (Amex) the shares underlying the warrants issued to Chesapeake Energy Corp. in July 2001 and the purchasers of the Series A Notes in December 2001. However, such approval is contingent on the shares being issued in conformance with Amex rules. Seven Seas Petroleum Inc. is an independent oil and gas exploration and production company operating in Colombia, South America. The Company's primary emphasis is on the development and production of the Guaduas Oil Field and exploration of the Subthrust Dindal Prospect, both of which are located in Colombia's prolific Magdalena Basin. Statements regarding anticipated oil and gas production and other oil and gas operating activities, including the costs and timing of those activities, are "forward looking statements" within the meaning of the Securities Litigation Reform Act. The statements involve risks that could significantly impact Seven Seas Petroleum Inc. These risks include, but are not limited to, adverse general economic conditions, operating hazards, drilling risks, inherent uncertainties in interpreting engineering and geologic data, competition, reduced availability of drilling and other well services, fluctuations in oil and gas prices and prices for drilling and other well services and government regulation and foreign political risks, as well as other risks discussed in detail in the Seven Seas Petroleum Inc.'s filings with the U.S. Securities and Exchange Commission.SOURCE Seven Seas Petroleum Inc.
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Bryan Sanchez, Investor Relations of Seven
Seas Petroleum Inc., +1-713-622-8218
