The purchase and sale agreement, entered into by Hupecol Caracara as the owner and operator of the Caracara Prospect, and effective as of January 1, 2008, provides for a sale price of $920 million.
Pursuant to its investment in Hupecol Caracara, Houston American holds a 1.59% interest in the Caracara Prospect and will receive its proportionate interest in the net sale proceeds after deduction of commissions and transaction expenses.
Completion of the sale of the Caracara prospect is subject to the satisfaction of various conditions set out in the purchase and sale agreement, including the granting of all consents and approvals of the Colombian government authorities required for the transfer of the assets to the purchaser.
John Terwilliger, president and chairman of Houston American, said: The execution of the purchase and sale agreement is the culmination of the previously announced efforts of Hupecol to selectively monetize assets. We believe the terms of the proposed sale are favorable to Houston American shareholders.
