Golden Energy 2017 bondholders OK standstill, extension, interest cut

By Wendy Van Sickle

Columbus, Ohio, March 30 – Holders of Golden Energy Offshore Service AS’ senior secured callable bond issue 2014/2017 approved a standstill expiring April 25, a maturity date extension and an interest reduction, according to a notice from bond trustee Nordic Trustee ASA.

The company sought the measures after it did not make the principal and interest payments due on the bonds on Feb. 28.

As previously reported, the company said it altered its original proposal announced in February after receiving feedback from some large bondholders requiring some changes. Initially, the bondholders meeting had been scheduled for March 11, but it was postponed until March 30 to accommodate those changes.

In order to obtain the support of these bondholders, the company agreed to amend the proposal to

• Remove the proposed addition of a call option at any time at par;

• Add a waiver of the asset coverage ratio covenant until Dec. 30, 2016; and

• Make the effectiveness of the amendments contingent on the redemption of at least NOK 100 million of the bonds by April 29.

In addition to the standstill, the company proposed to extend the maturity date to Dec. 31, 2017 from May 28, 2017, make the missed installment payment in kind on or about April 4 and reduce the interest rate for the period of Nov. 30 to April 29 to 5% from Nibor plus 725 basis points.

The proposal passed with approval from holders of 94.54% of the notes represented at the meeting.

Golden Energy plans to buy back up to NOK 100 million of the bonds at 30% of par in cash in April through a reverse auction tender offer. The company said it has received a “soft commitment” from affiliates to inject additional equity into the company to fund the offer, which is subject to the approval of the company’s proposal and the receipt of a firm commitment.

According to a prior notice from the trustee, the values of Golden Energy’s two vessels are declining, the company is not in compliance with an asset coverage ratio covenant under the bond agreement, and it has not received some charter payments, causing liquidity difficulties.

The offshore services company is based in Alesund, Norway.

© 2015 Prospect News.
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