Hydrocarb Energy Corp (OTCBB:HECC) was a notable mover during Monday’s trading session. The stock surged by close to 44% on high volumes, which were 5 times the daily average. The stock has been trending higher ever since it broke-out above the resistance zone of $1.310. The stock currently trades above all daily moving averages. The indicator for relative strength continues to trend in the overbought zone and show no signs of a reversal. The MACD oscillator has given a buy signal, which is considered to be bullish. Traders see the stock heading to levels of $2.85 in the near term.
Hydrocarb Energy Corp (OTCBB:HECC) announced that it had decided to retire all of its convertible notes having floorless conversion rights. As per the reports, it had paid in full before converting the debt into equity.
Insights of The Matter
The one thing that prompted Hydrocarb to come up with these notes was to arrange additional financing; however, it was able to receive financing from other sources at favorable terms lately. It helped the company to make up its mind for retiring these notes even before any conversion could take place. Hydrocarb got funding from a few sources, including $1.74 million amount via a private placement that took place recently.
In addition to these funds, the company has also decided to implement a new series of “Cash Redeemable Notes” for a short term period. These notes are neither intended nor designed to be converted into the common shares of the company.
The senior management team of the company is positive about this announcement and hopes that it will have a positive impact on the overall funding in the coming months. According to Kent Watts, Chief Executive Officer, Hydrocarb Corp, the strategic steps taken by the company over the past few months has put it in such a position that it doesn’t require these notes any longer.
By retiring these floorless notes, Hydrocarb has made sure that its common stocks aren’t diluted. The next objective of the company is to look for a long-term solution to fulfill all the debt related requirements in a hassle-free way. If everything falls in line regarding financing, Hydrocarb can go on to develop its assets based in Namibia and Galveston Bay in a hassle-free way.
It is expected to take a number of steps to ensure that financing and operational efficiency can remain intact over the coming quarters. Details of such initiatives will be shared publically at the right time.