For those who were complaining about the $600 million debt financing arrangement that Connacher made on November 19, 2007 take a look at it now in light of the debt financing arrangement that Oilexco made today!

Connacher's original press release on November 19, 2007 stated the following about it's debt financing arrangement:

"Calgary, Alberta - Connacher Oil and Gas Limited (CLL - TSX) announced today it has entered into a definitive agreement to issue and sell US$600 million face value of 10.25% Senior Secured Notes due December 15, 2015 ("Notes") at a price of 98.657%, resulting in a yield to maturity of 10.50%. The Notes have been resold through a syndicate of investment banks to certain institutional investors pursuant to applicable securities law exemptions. The completion of the Note financing is anticipated to occur on December 3, 2007 and is subject to the finalization of definitive documentation and other customary closing conditions.

Now, compare this to Oilexco's press release on November 19. 2008 today in terms of it's debt financing arrangement:

"The offering being marketed consists of up to U.S. $150,000,000 aggregate principal amount of Convertible Senior Unsecured Bonds due 2013 (the "Bonds") and up to 20,000,000 common shares (the "Common Shares") at an issue price of C$2.25. Subject to market conditions, the offering is anticipated to close on or about December 5, 2008.

The Bonds are expected to be senior, unsecured obligations of Oilexco bearing interest at an annual rate of 15% payable quarterly in arrears commencing in March, 2009 and maturing five years and one day following the closing date. Bonds are expected to be convertible at the option of the holder into common shares of Oilexco at a conversion price (using a fixed exchange rate of U.S.$1.00=C$1.2239) of C$2.74 per common share from the 41st day after the closing date to the 6th business day before the maturity date. "

Connacher's financing is for 10.5% for a larger sum of money due two years later, compared to Oilexco's rate of 15% if I read this correctly. It looks like Oilexco got hosed in the current economic environment. We are very fortunate that Richard Gusella and his team got us the financing arrangement when they did.

Cheers; Scott