HighPeak Energy, Inc. has entered into a comprehensive refinancing agreement involving a $450 million investment in newly issued Series A 6.0% Perpetual Convertible Preferred Stock and a new $800 million reserve-based credit facility. The preferred stock investment is being made by PT Danantara Energy International (DEI), a subsidiary of PT Danantara Investment Management, and PT Tunas Harapan Perkasa (THP), a subsidiary of PT Energi Mega Persada Tbk. The total gross proceeds from the sale of 450,000 shares of Series A Preferred Stock are expected to be approximately $450 million.
The Series A Preferred Stock features a liquidation preference of $1,000 per share and is convertible into HighPeak common stock at an initial rate of $9.50 per share. The stock pays cumulative cash dividends quarterly, with rates increasing over time: 6.0% per annum for the first two years, 7.5% for years three through five, and 10.0% thereafter. The preferred stock may be redeemed by the Company on or after the third anniversary of the closing at a price resulting in a 10.0% internal rate of return (IRR), or it may be mandatorily converted if the common stock price exceeds 150% of the conversion price for 30 out of 40 consecutive trading days.
Under the terms of the agreements, DEI and THP will each be entitled to nominate one individual for election to HighPeak’s Board of Directors. Additionally, the investors have agreed to a two-year standstill period and transfer restrictions on the preferred stock following the closing. The Company also entered into a debt commitment letter with Citigroup, N.A. and Fifth Third Bank, National Association for the new $800 million credit facility, which is expected to be used to repay the Company’s existing $1.17 billion term loan in full. The transaction is expected to close during the fourth quarter of 2026, subject to customary conditions.
