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On February 17, 2017, Harvest entered into an agreement with a Korean based bank that allows Harvest to borrow $500 million through a three year fixed rate term loan. Once drawn, proceeds from the term loan will be used to repay credit facility borrowings. In addition, as at February 23, 2017, Harvest has received formal commitments for a new three year $500 million revolving credit facility with a syndicate of banks that will replace the Company's $1 billion revolving credit facility. Both the term loan and new syndicated revolving credit facility are guaranteed by KNOC and are both expected to close on February 24, 2017. The new syndicated revolving credit facility is secured by a first floating charge over all of the assets of Harvest and its material subsidiaries and contains no financial covenants. On December 22, 2016, KNOC converted all its outstanding loans to common shares of Harvest. The carrying value of the loans, plus accrued interest at December 22, 2016 of $722.2 million was converted to equity and $10.3 million previously recognized in contributed surplus relating to these loans were transferred to shareholder's capital. As a result, 72.7 million common shares were issued to KNOC. As at December 31, 2016 there were no related party loans outstanding. This transaction provides significant savings to Harvest through reducing interest expense by approximately $40.0 million annually, improving the Company's balance sheet, and is further evidence of KNOC's continuing financial support of Harvest. On June 16, 2016 Harvest completed an exchange of a significant portion of its 6 % senior notes due 2017, for new 2 1/3% senior notes due 2021, at an exchange ratio of US$900 principal amount of the new 2 1/3% senior notes for each US$1,000 principal amount of the old 6 % senior notes.

For the original version including any supplementary images or video, visit http://www.marketwatch.com/story/harvest-operations-reports-2016-year-end-results-2017-02-23-191732339

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