Swift Energy Elects Not to Make Senior Notes Interest Payment and Continues Negotiations With Bondholder Group
Swift Energy Company (NYSE: SFY) (“Swift Energy” or the “Company”) today
announced that, although it has current liquidity sufficient to make the
$8.9 million semi-annual interest payment due December 1, 2015, on its
outstanding $250 million principal amount of 7.125% Senior Notes due
2017 (the “Notes”), it has elected not to do so. Non-payment of this
interest is not an event of default under the indenture governing the
Notes, but would become an event of default if the payment is not made
within 30 days.
As the Company has previously disclosed, it is engaged in ongoing
negotiations with a group of holders of its outstanding senior notes
(including the Notes) regarding restructuring those senior notes, along
with possible avenues for increasing its near-term liquidity, with no
understanding reached to date. The outcome and timing of the
negotiations cannot be predicted at this time.
Upon an event of default under the Notes indenture, the trustee or
holders of not less than 25% in aggregate principal amount of the Notes
then outstanding may declare the principal amount of the Notes plus
accrued and unpaid interest to be immediately due and payable. An event
of default under the Notes would also result in cross defaults under the
Company’s other outstanding senior notes and its revolving credit
facility.
As of November 30, 2015, outstanding borrowings (including outstanding
letters of credit) under the Company’s revolving credit facility totaled
$330 million. The Company is continuing to pay suppliers and trade
creditors and fund current operations on an ongoing basis.
The Company has retained Lazard to advise the Company’s management and
Board of Directors with respect to realigning its balance sheet, in
addition to addressing financing alternatives and enhancing its
liquidity profile. The Company has also hired the law firm of Jones Day
to serve as its restructuring counsel and Alvarez & Marsal North
America, LLC to serve as the Company’s financial advisor.
About Swift Energy Company
Swift Energy Company, founded in 1979 and headquartered in Houston,
engages in developing, exploring, acquiring and operating oil and gas
properties, with a focus on the Eagle Ford trend of South Texas and, to
a lesser extent, the onshore and inland waters of Louisiana.
Forward-Looking Statements
This press release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. The
opinions, forecasts, projections, or other statements contained herein
or implied by this press release, other than statements of historical
fact, are forward-looking statements. These forward-looking statements
relate, in part, to the outcome of the Company’s negotiations with its
bondholders, the risks relating to the possible restructuring of the
Company’s balance sheet and enhancing of its liquidity, including
whether or not the Company will be successful in doing so, and the
sufficiency of the Company’s current liquidity sources to fund its
current operations. These statements are based upon assumptions that are
subject to change and to risks in the Company’s business. Although the
Company believes that the expectations reflected in such forward-looking
statements are reasonable, it can give no assurance that such
expectations will prove to have been correct. Certain risks and
uncertainties inherent in the Company’s business are set forth in the
filings of the Company with the Securities and Exchange Commission.
View source version on businesswire.com: http://www.businesswire.com/news/home/20151201006719/en/
Copyright Business Wire 2015
Source: Business Wire
(December 1, 2015 - 4:30 PM EST)
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