SAN ANTONIO, April 26, 2017 /PRNewswire/ -- Lilis Energy,
Inc. (NASDAQ: LLEX), an exploration and development company
operating in the Permian Basin of West
Texas, today announced the closing of $140 million in new financings. The financings
include a $125 million convertible
second lien term loan facility funded by Vӓrde Partners, Inc.
("Vӓrde"), and an additional $15
million in the form of incremental term loans under Lilis's
existing first lien credit facility. The funds will be used to fuel
the Company's continued expansion in the Permian Basin through
leasing activity and acquisitions, as well as to fund Lilis's
drilling program. Additionally, the funds will be used to repay
approximately $38 million of the
Company's existing debt, as well as for general corporate
purposes.
The $125 million financing from
Vӓrde consists of an $80 million
convertible, second lien term loan that funded at closing on
April 26, and a $45 million delayed-draw term loan on the same
terms, to fund future acreage acquisitions. The delayed-draw term
loan is committed to Lilis for leasing activity within defined
parameters and available either in a single draw or in multiple
draws to fund future acreage acquisitions. Both tranches earn
interest at 8.25% annually, paid-in-kind, through a four-year
maturity. The Vӓrde term loans are convertible, subject to
certain terms and conditions, at $5.50 per share. The new $15 million term loan was structured as an
amendment to the Company's existing first lien term loan
facility.
"Värde is a welcomed partner who sees our vision, and recognizes
our progress and commitment to increasing value for all
stakeholders. We are drilling wells that are among the best in the
country on a BOE per lateral foot basis. We have surpassed our
June 30 acreage target of 10,000 net
acres in the core of the Delaware
Basin, well ahead of schedule. Our goals are to continue our rapid
growth through the drill bit, aggressive leasing, and accretive
acquisitions. This financing gets us the dry powder we need to
accelerate our efforts," said Avi
Mirman, Lilis's Chief Executive Officer.
"We look forward to our partnership with Lilis, and appreciate
the opportunity to participate in the Company's exciting growth
prospects," said Markus Specks, Managing Director at Värde who
leads Oil and Gas investing. "This transaction pairs well with our
objective to provide tailored capital solutions to the oil and gas
industry in a way that aligns value creation for all
stakeholders."
Upon closing, Värde received one Observer seat on Lilis's Board
of Directors and, upon conversion ,may receive up to two Board
seats based on its proportionate holdings of the Company's common
equity. Lilis's Board of Directors have the right to approve
proposed candidates for Board seats.
The Company also announced that it has redeemed or converted all
outstanding shares of its outstanding preferred stock. Through an
agreement reached with the holders of its Series B 6% Preferred
Stock, all shares of Series B 6% Preferred Stock converted into
approximately 14.3 million shares of common stock concurrently with
the closing of the second lien term loan facility. Additionally,
the Company redeemed, in full, its 6% Redeemable Preferred Stock as
of April 21, 2017.
Joseph C. Daches, Lilis's EVP and CFO added: "We are pleased to
have successfully redeemed and converted these two pieces of
preferred stock, and have made progress on our efforts to
streamline our capital structure. We are also excited to
partner with Värde and believe we have negotiated a structure that
will exponentially enhance shareholder value."
KES 7 Capital Inc. acted as the Company's adviser for the new
first lien credit facility financing.
Bracewell LLP served as legal advisor to the Company, and
Kirkland & Ellis LLP served as legal advisor to Vӓrde.
About Lilis Energy, Inc.
Lilis Energy, Inc. is a San
Antonio-based independent oil and gas exploration and
production company that operates in the Permian's Delaware Basin, considered amongst the leading
resource plays in North America.
Lilis's total net acreage in the Permian Basin is over 10,000
acres. Lilis Energy's near-term E&P focus is to grow current
reserves and production, and pursue strategic acquisitions in its
core areas. For more information, please visit
www.lilisenergy.com.
About Värde Partners
Värde Partners is a $12 billion
global alternative investment firm that employs a value-based
approach to investing across a broad array of geographies, segments
and asset types, including real estate, corporate credit,
residential mortgages, specialty finance, transportation, and
energy. Värde sponsors and manages a family of private investment
funds with a global investor base that includes foundations and
endowments, pension plans, insurance companies, other institutional
investors and private clients. Now in its third decade, Värde
employs 250 people with main offices in Minneapolis, London and Singapore. For more information about the
firm, please visit www.varde.com, and for more information about
the firm's activity in the oil and gas industry, please contact
Markus Specks by email at mspecks@varde.com.
Forward-Looking Statements:
This press release
contains forward-looking statements within the meaning of the
federal securities laws. Such statements are subject to a number of
assumptions, risks and uncertainties, many of which are beyond the
control of the Company. These risks include, but are not limited
to, our ability to replicate the results described in this release
for future wells; the ability to finance our continued exploration,
drilling operations and working capital needs, all the other
uncertainties, costs and risks involved in exploration and
development activities; and the other risks identified in the
Company's Annual Report on Form 10-K and its other filings with the
Securities and Exchange Commission (the "SEC"). Investors are
cautioned that any such statements are not guarantees of future
performance and that actual results or developments may differ
materially from those projected in the forward-looking statements.
The forward-looking statements in this press release are made as of
the date hereof, and the Company does not undertake any obligation
to update the forward-looking statements as a result of new
information, future events or otherwise.
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SOURCE Lilis Energy, Inc.