U.S. Energy Corp. Announces Amendment to Existing Credit Agreement including Maturity Extension through July 30, 2019
June 29 2017 - 6:00AM
U.S. Energy Corp. (Nasdaq:USEG) (“U.S. Energy” or
“Company”) announced that the Company and its sole lender, APEG
Energy II, L.P. (“APEG”), have entered into the 5th Amendment to
the Credit Agreement. The amendment extends the maturity date
of the Credit Agreement through July 30, 2019, while setting forth
new covenants which can be seen below:
Amended Credit Facility
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Prior CreditAgreement Terms |
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New CreditAgreement Terms |
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Maturity Date: |
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July 30, 2017 |
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July 30, 2019 |
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Effective Weighted
Average Interest Rate: |
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7.39% |
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8.75% |
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Outstanding Debt: |
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$6.0mm |
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$6.0mm |
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New Covenant Calculations at
3/31/17
PDP Coverage
Ratio: |
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Greater than 1.2x |
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PDP
PV-101: |
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$8.4mm |
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Outstanding Debt: |
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$6.0mm |
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PDP Coverage Ratio: |
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1.4x |
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In Compliance |
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Current
Ratio: |
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Greater than 1.0 to 1.0 |
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Current Assets |
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$4.7mm |
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Current
Liabilities subject to calculation2 |
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$1.2mm |
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Current
Ratio |
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3.8 to 1.0 |
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In Compliance |
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1 SEC
pricing of $47.61 oil and $2.73 gas was used in calculation2
Represents the amount derived from new covenant calculation
definition |
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Current Hedge Position
Period |
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Oil (Bbls/d) |
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Swap Price ($USD) |
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2017 Crude Oil Swaps |
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May 1, 2017
– December 31, 2017 |
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300 |
$ |
52.40 |
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“We are pleased to have completed this amendment
to our Credit Agreement and to have Angelus as a strategic partner
going forward,” commented David Veltri, U.S. Energy’s President and
Chief Executive Officer. “The multi-year extension to U.S. Energy’s
only existing debt will allow the Company to focus on navigating
the current commodity price environment and provide the flexibility
to execute on its corporate initiatives. We expect our growth
to be through accretive acquisitions and asset consolidation in the
near term. The Company is forecasted to remain in full compliance
with the amendment’s new financial covenants and we expect to
re-classify the associated debt balance as a long-term liability on
our upcoming quarterly financial report.”
“We are very excited about working with U.S.
Energy and its strong management team to provide a refinancing
solution that, in combination with becoming a strategic partner to
U.S. Energy’s attractive portfolio of low-decline assets, should
allow for the creation of meaningful value for all stakeholders. We
strongly believe that our partnership with U.S. Energy will serve
as a foundation for future success and position the Company to take
advantage of the dislocation in the current market environment,”
said Paul Haarman and Patrick Duke, Managing Partners at Angelus
Capital, in a joint statement.
About APEG Energy II, L.P.
APEG Energy II, L.P. was formed by Angelus Capital,
a private equity firm headquartered in Austin, TX, to make energy
investments across the capital structure through multiple
platforms. Angelus Capital specializes in investments primarily in
development stage real estate properties and growth oriented
domestic energy assets.
Forward-Looking Statements
All statements included in this release relating
to future plans, projects, events or conditions and all other
statements other than statements of historical fact included in
this release are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995.
Forward-looking statements in this press release relate to, among
other things, the offering of the Convertible Notes and the
expected use of proceeds from such offering. These statements
are based upon current expectations and are subject to a number of
risks, uncertainties and assumptions, including changes in
long-term oil and gas prices and other market conditions affecting
the oil and gas industry, reservoir performance, the outcome of
commercial negotiations and changes in technical or operating
conditions, among others, that could cause actual results,
including project plans and related expenditures and resource
recoveries, to differ materially from those described in the
forward-looking statements. The Company does not assume any
obligation and expressly disclaims any duty to update the
information contained herein except as required by law.
Corporate Contact:
U.S. Energy Corp.
Ryan Smith
Chief Financial Officer
303-993-3200
www.usnrg.com
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