SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report December 30, 2002
(Date of earliest event reported) December 16, 2002
SEVEN SEAS PETROLEUM INC.
(Exact Name of registrant as Specified in its Charter)
Cayman Islands 0-22483 73-468669
(State or Other Jurisdiction of (Commission File Number) (I.R.S. Employer
Incorporation or Organization) Identification Number)
5555 SAN FELIPE, SUITE 1700, HOUSTON, TEXAS 77056
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (713) 622-8218
Item 5. Other Events
On December 16, 2002, Seven Seas Petroleum Inc. announced that it is in
default under its 12-1/2% $110 Million Senior Subordinated Notes ("Senior
Notes") due to a failure to make the $6,875,000 semiannual interest payment on
November 15, 2002. The full principal plus accrued and unpaid interest will be
due and payable immediately upon notice by the trustee or holders of 25% of the
Senior Notes.
As previously announced, the Company is currently in default under its 12%
Senior Secured $45 Million Notes ("$45 Million Notes") as a result of
cross-default provisions in the governing documents relating to the Company's
failure to meet the obligations owed to the Senior Notes. On December 13, 2002,
Chesapeake Energy accelerated all amounts owing to Chesapeake Energy, including
principal, accrued interest, fees, costs, and expenses, and as a result, such
amounts are immediately due and payable. Additionally, under the terms of the
$22.5 million CHK Note (one-half of the $45 Million Notes) the rate of interest
has been increased from 12% to a default rate of 13%.
Chesapeake, as collateral agent for the $45 Million Notes, has exercised
its rights to exclusive control over Seven Seas' bank accounts, pursuant to
deposit control agreements related to the Note Purchase and Loan Agreement dated
July 9, 2001. Seven Seas cannot access its US bank accounts without prior
approval from the collateral agent. Most of Seven Seas' operating cash is held
in these accounts. Seven Seas has been advised by the collateral agent that the
collateral agent currently intends to approve disbursements by the Company and
its subsidiaries from these accounts as necessary to prudently operate the
Guaduas Oil Field in the ordinary course of business.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99 December 16, 2002 press release
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SEVEN SEAS PETROLEUM INC.
By: RONALD A. LEFAIVE
Name: Ronald A. Lefaive
Title: Vice President of Finance and Chief
Financial Officer
Date: December 30, 2002
INDEX TO EXHIBITS
Exhibit No. Description Method of Filing
- ----------- ----------- ----------------
99 December 16, 2002 Press release Filed herewith electronically