Kosmos Energy Ltd. Announces
Offering Of $300 Million Of Convertible Senior Notes Due
2030
March 4, 2024
Dallas, March 4, 2024 - Kosmos Energy Ltd.
(NYSE/LSE: KOS) ("Kosmos" or the "Company") announced today that it
intends to offer, subject to market and other conditions, $300
million aggregate principal amount of its convertible senior notes
due 2030 (the "notes") in a private placement. The Company also
expects to grant the initial purchasers an option to purchase up to
an additional $45 million aggregate principal amount of notes, for
settlement within a 13-day period beginning on, and including, the
date on which the notes are first issued. The notes will be senior,
unsecured obligations of the Company. The notes will rank pari
passu with the Company's existing senior notes and the Company's
revolving credit facility. The notes will be guaranteed (i) on a
senior, unsecured basis by certain of the Company's existing
subsidiaries that guarantee on a senior basis the Company's
revolving credit facility and the Company's existing senior notes,
and (ii) on a subordinated, unsecured basis by certain of the
Company's existing subsidiaries that borrow under or guarantee the
Company's commercial debt facility and guarantee on a subordinated
basis the Company's revolving credit facility and the Company's
existing senior notes. Upon conversions of the notes, the Company
will satisfy its conversion obligation by paying cash up to the
aggregate principal amount of the notes to be converted, and paying
or delivering, as the case may be, cash, shares of the Company's
common stock or a combination of cash and shares of the Company's
common stock, at the Company's election, in respect of the
remainder, if any, of its conversion obligation in excess of the
aggregate principal amount of the notes to be converted. The
interest rate, conversion rate and other terms of the notes are to
be determined upon pricing of the offering.
The Company intends to use the net
proceeds from the sale of the notes to (i)
repay a portion of outstanding indebtedness under the Company's
commercial debt facility; (ii) pay the cost of the capped call
transactions described below; and (iii) pay fees and expenses
related to the offering.
In connection with the pricing of
the notes, the
Company expects to enter into privately negotiated capped call
transactions with one or more of the initial purchasers of the
notes or their respective affiliates and/or other financial institutions (the
"option counterparties").
The capped call transactions are expected
generally to reduce potential dilution to the Company's
common stock upon
any conversion of
the notes and/or
offset any cash payments the Company is required to make in excess
of the principal amount of converted notes,
as the case may be, with such reduction and/or offset subject to a
cap. If the initial
purchasers of the notes exercise their option to purchase
additional notes, the Company expects to enter into additional
capped call transactions with the option counterparties, and
expects to use a portion of the net proceeds from the additional
notes to pay the cost of such additional capped call
transactions.
In connection with establishing
their initial hedges of the capped call transactions, the Company
expects the option counterparties or their respective affiliates to
enter into various derivative transactions with respect to the
Company's common stock concurrently with or shortly after the
pricing of the notes, and may unwind these various derivative
transactions and purchase the Company's common stock in open market
transactions shortly after the pricing of the
notes. This
activity could increase (or reduce the size of any decrease in) the
market price of the Company's common stock or the notes at that
time.
In addition, the option counterparties or their
respective affiliates may modify their hedge positions by entering
into or unwinding various derivatives with respect to the Company's
common stock and/or purchasing or selling the Company's common
stock or other securities of the Company in secondary market
transactions following the pricing of the notes and prior to the
maturity of the notes (and are likely to do so during any
observation period related to a conversion of
notes). This
activity could also cause or avoid an increase or a decrease in the
market price of the Company's common stock or the
notes, which could
affect the ability of noteholders to convert the notes
and, to the extent
the activity occurs during any observation period related to a
conversion of the notes,
it could
affect the number of shares and value of
the consideration that noteholders will receive upon conversion of the
notes.
The offering is being made to
persons reasonably believed to be qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended
(the "Securities Act"). The offer and sale of the notes, the guarantees and any shares
of the Company's common stock issuable upon conversion of the notes
have not been and will not be registered under the Securities
Act, or under any
state securities laws, and the notes and such shares may not be
offered or sold in the United States except pursuant to an
exemption from, or
in a transaction not subject to, the registration requirements of
the Securities Act and applicable state securities laws.
This announcement does not
constitute an offer to sell or the solicitation of an offer to buy
the notes in the offering,
nor shall there be any sale of such notes in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
Forward-Looking Statements
This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. All statements, other than statements of historical
facts, included in this press release that address activities,
events or developments that Kosmos expects, believes or anticipates
will or may occur in the future are forward-looking statements,
including the potential offering of convertible senior notes and
the anticipated terms of, and effects of entering into, the capped
call transactions. Kosmos' estimates and forward-looking statements
are mainly based on its current expectations and estimates of
future events and trends, which affect or may affect its businesses
and operations. Although Kosmos believes that these estimates and
forward-looking statements are based upon reasonable assumptions,
they are subject to several risks and uncertainties and are made in
light of information currently available to Kosmos. When used in
this press release, the words "anticipate," "believe," "intend,"
"expect," "plan," "will," "potential," "may" or other similar words
are intended to identify forward-looking statements. Such
statements are subject to a number of assumptions, risks and
uncertainties, many of which are beyond the control of Kosmos,
which may cause actual results to differ materially from those
implied or expressed by the forward-looking statements. Further
information on such assumptions, risks and uncertainties is
available in Kosmos' Securities and Exchange Commission filings.
Kosmos undertakes no obligation and does not intend to update or
correct these forward-looking statements to reflect events or
circumstances occurring after the date of this press release,
except as required by applicable law. You are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date of this press release. All
forward-looking statements are qualified in their entirety by this
cautionary statement.
About Kosmos Energy Ltd.
Kosmos is a full-cycle deepwater
independent oil and gas exploration and production company focused
along the Atlantic Margins. The Company's key assets include
production offshore Ghana, Equatorial Guinea and the U.S. Gulf of
Mexico, as well as a world-class gas development offshore
Mauritania and Senegal. Kosmos also maintains a sustainable proven
basin exploration program in Equatorial Guinea and the U.S. Gulf of
Mexico. Kosmos is listed on the New York Stock Exchange and London
Stock Exchange and is traded under the ticker symbol
KOS.
Kosmos Energy Ltd. is headquartered in Dallas,
TX.
Investor Relations
Jamie Buckland
+44 (0) 203 954 2831
jbuckland@kosmosenergy.com
Media Relations
Thomas Golembeski
+1-214-445-9674
tgolembeski@kosmosenergy.com
SOURCE: Kosmos
Energy Ltd.