IOG proposes to waive, defer senior secured bond terms to Sept. 29

By Marisa Wong

Los Angeles, Aug. 2 – IOG plc confirmed in a Wednesday press release that it is proposing a further waiver with respect to some terms of its €100 million senior secured bond, having been agreed in principle with key bondholders.

The waiver agreement is intended to provide a further period of stability for the company to address balance sheet challenges, with some items under the bond terms to be waived or deferred for the period to Sept. 29.

The proposals include, among other things, the following:

• Deferring the payment date for the July 31 and Sept. 20 interest payments to Sept. 29;

• Waiving the obligation to fund the debt service reserve account until Sept. 29 (however, existing funds will remain in that account);

• Waiving the minimum liquidity covenant and minimum interest coverage ratio requirement until Sept. 29; and

• Waiving some other technical potential events of default.

Subject to approval of the proposal, the repayment price of the bonds will be increased to 105% of par and the call option and early redemption prices increased by 5 percentage points.

In addition, a board observer will be appointed to attend IOG board meetings and advise the company on short and medium-term financial measures.

As these measures have now been agreed in principle with key bondholders, a summons for a written resolution reflecting the above is being issued to bondholders seeking approval of these amendments.

The company said it has received voting undertakings of support to vote in favor of the proposed resolution from bondholders controlling more than 60% of the voting bonds.

Chief executive officer Rupert Newall commented in the release, “This proposed waiver to the end of September has been agreed in principle with major bondholders. Upon execution, it will enable us to continue our dedicated efforts to address the challenges facing the business and deliver an outcome in the best interests of all stakeholders.”

IOG is a United Kingdom developer and producer of indigenous offshore gas. The company was previously known as Independent Oil & Gas plc.

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