Serinus Announces EBRD Debt Restructuring Agreement
October 30 2017 - 2:00AM
Serinus Energy Inc. (“Serinus”, “SEN” or the “Company”) (TSX:SEN)
(WARSAW:SEN) is pleased to announce that it has reached an
agreement with the European Bank of Reconstruction and Development
(“EBRD”) to restructure the terms of the two debt facilities the
Company has outstanding with the EBRD. The Company believes that
this restructuring of the debt provides the appropriate balance for
the Company to be able to meet the debt servicing requirements
while also being able to make the capital investments necessary to
grow the Company to the benefit of the equity shareholders in the
Company.
The Company has two outstanding loan agreements
with the EBRD, these being the Senior Loan Facility and the
Convertible Loan Facility. Both loan agreements contain a number of
affirmative covenants, including maintaining the specified
security, environmental and social compliance, and maintenance of
specified financial ratios. The new agreement provides for changes
to specific terms of each of the loan facilities as well as to the
affirmative covenants.
The outstanding principal of the Senior Loan
Facility is currently US$5.4 million with an interest rate of
6-month LIBOR plus 6.0% and an original maturity date of March
2019. The original payment schedule had the principal repayments
made in twelve equal semi-annual instalments with the first
repayment made on March 31, 2015. The new agreement with the EBRD
involves the following changes to the terms of the Senior Loan
Facility:
- The repayment schedule no longer requires the scheduled US$1.7
million payments for September 30, 2017, March 31, 2018 and
September 30, 2018, with the remaining balance thereof to be paid
on March 31, 2019. Instead, the terms under the new agreement are
such that the Company will make payments of $2.7 million on March
31, 2019 and September 30, 2019, covering the remaining balance of
the Senior Loan Facility.
- The cash sweep is now computed at the corporate level, instead
of only Tunisia, on the annual and semi-annual consolidated
accounts. Any cash balance in excess of US$7.0 million is to be
used to prepay the senior loan in inverse order of maturity until
the outstanding senior loan balance is no greater than that under
the original amortisation schedule.
- The interest rate of 6-month LIBOR plus 6.0% remains unchanged
and the payment of accrued interest is unchanged.
The Convertible Loan Facility has a current
outstanding principal of US$25.4 million with an original maturity
of June 2021 and an original interest rate of 6-month Libor plus a
margin. The original margin was determined by the calculation of
the Incremental Net Revenues Percentage (INRP) for Tunisia, which
is the percentage rate equal to (i) the amount by which the Net
Revenues (revenues minus royalties) for the most recent complete
Financial Year exceeds US$35,000,000, divided by (ii) US$2,000,000
(rounded down to two decimal points). The minimum margin is 8.0%
and the maximum margin is 17.0%. Under the new agreement, the terms
of the Convertible Loan Facility have changed as follows:
- The maturity is extended to June 2023, with accrued interest
accumulation until June 2020.
- In June 2020, the total outstanding principal plus accumulated
accrued interest will be determined and this amount will constitute
the new balance to be equally amortized over four annual payments
to be made each month of June for the years 2020 to
2023.
- From the date of the loan amortization, interest is paid on the
outstanding loan balance on each interest payment date.
- The Loan Conversion option remains as per the original
agreement.
- The interest rate remains 6-month LIBOR plus the margin, but
the margin is now calculated on the consolidated net revenues of
our Tunisia and Romania subsidiaries exceeding US$25,000,000
instead of US$35,000,000 for Tunisia alone as per the original
agreement. The minimum and maximum margins remain the same at 8.0%
and 17.0%, respectively.
In addition to the specific changed terms
applied to each of the loan facilities, some of the affirmative
covenants of both facilities have also been changed. The original
agreements had a debt service coverage ratio calculated on a
quarterly basis for Tunisia and at the corporate level, with a
minimum ratio of 1.3x for Tunisia and 1.5x for consolidated
required to be in compliance. A debt-to-EBITDA ratio was also
calculated on a quarterly basis at the Tunisia and corporate level
in both original agreements with a maximum ratio of 2.5x for
Tunisia and 2.75x consolidated required to be in compliance. The
new agreement covenants have changed as follows:
- The debt service coverage ratio will now only be calculated on
a consolidated corporate level and only for the Senior Loan
Facility starting in December 2018. This ratio will no longer be
applicable to the Convertible Loan Facility. The minimum ratio is
1.3x.
- For the debt-to-EBITDA ratio, the maximum ratio for compliance
will be 10.0x for calculation in September 2018 and December 2018,
reverting to a maximum of 2.5x for quarterly calculations from 2019
onwards.
- The definition of cash flow after debt service has been changed
to exclude any capital expenditures made from any equity proceeds
raised by the Company.
The new loan restructuring agreement will
maintain the original security on both loans, with an additional
security pledge of the shares of Serinus Energy Romania S.A.,
holder of the Romanian assets.
About Serinus
Serinus is an international upstream oil and gas
exploration and production company that owns and operates projects
in Tunisia and Romania.
For further information, please refer to the
Serinus website (www.serinusenergy.com) or contact the
following:
Serinus Energy
Inc.Calvin BrackmanVice President, External
Relations & StrategyTel.: +1-403-264-8877
cbrackman@serinusenergy.com |
|
Serinus Energy Inc.
Jeffrey AuldChief Executive OfficerTel.:
+1-403-264-8877 jauld@serinusenergy.com |
Translation: This news
release has been translated into Polish from the English
original.
Forward-looking Statements
This release may contain forward-looking statements made as
of the date of this announcement with respect to future activities
that either are not or may not be historical facts. Although the
Company believes that its expectations reflected in the
forward-looking statements are reasonable as of the date hereof,
any potential results suggested by such statements involve risk and
uncertainties and no assurance can be given that actual results
will be consistent with these forward-looking statements.
Various factors that could impair or prevent the Company from
completing the expected activities on its projects include that the
Company's projects experience technical and mechanical problems,
there are changes in product prices, failure to obtain regulatory
approvals, the state of the national or international monetary, oil
and gas, financial , political and economic markets in the
jurisdictions where the Company operates and other risks not
anticipated by the Company or disclosed in the Company's published
material. Since forward-looking statements address future events
and conditions, by their very nature, they involve inherent risks
and uncertainties and actual results may vary materially from those
expressed in the forward-looking statement. The Company undertakes
no obligation to revise or update any forward-looking statements in
this announcement to reflect events or circumstances after the date
of this announcement, unless required by law.
Semco (NYSE:SEN)
Historical Stock Chart
From Jun 2024 to Jul 2024
Semco (NYSE:SEN)
Historical Stock Chart
From Jul 2023 to Jul 2024