CorEnergy Infrastructure Trust, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Convertible Debt

Convertible Debt

9 Months Ended

Sep. 30, 2016

On May 23, 2016, the Company repurchased $1 million of its convertible bonds on the open market. This resulted in the company writing off a portion of the original underwriter's discount and deferred debt costs, as well as recognizing a gain on extinguishment of debt of $72 thousand which is included in Interest Expense in the Consolidated Statements of Income.

The following is a summary of the impact of Convertible Notes on interest expense for the three and nine months ended September 30, 2016 and 2015, respectively:



Convertible Note Interest Expense
	For the Three Months Ended				For the Nine Months Ended
	September 30, 2016		September 30, 2015		September 30, 2016		September 30, 2015
7% Convertible Notes	$	2,017,167	$	2,012,500	$	6,013,195	$	2,057,222
Discount Amortization	185,391		192,418		559,353		192,418
Deferred Debt Issuance Amortization	11,539		9,266		36,497		9,266
Total	$	2,214,097	$	2,214,184	$	6,609,045	$	2,258,906

The Convertible Notes were initially issued with an underwriters' discount of $3.7 million which is being amortized over the life of the Convertible Notes. Including the impact of the convertible debt discount and related deferred debt issuance costs, the effective interest rate on the Convertible Notes is approximately 7.8 percent and 7.7 percent for the three and nine months ended September 30, 2016, respectively, compared to 7.7 percent and 7.8 percent for the three and nine months ended September 30, 2015, respectively.