Denbury Announces Senior Subordinated Notes Exchange Agreements
May 04 2016 - 12:34AM
Denbury Resources Inc. (NYSE:DNR) (“Denbury” or the “Company”)
today announced that it has entered into privately negotiated
exchange agreements with holders of approximately $839.4 million in
aggregate principal amount of its outstanding senior subordinated
notes (the “Old Notes”) to exchange that principal amount of Old
Notes for approximately $482.9 million in aggregate principal
amount of the Company’s new 9% Senior Secured Second Lien Notes due
2021 (the “New Notes”) and approximately 33.6 million shares of the
Company’s common stock (the “Shares”). Pursuant to the
exchange agreements, the Company will exchange the New Notes and
Shares for approximately $123.4 million in aggregate principal
amount of its outstanding 6⅜% Senior Subordinated Notes due 2021
(the “2021 Notes”), approximately $301.7 million in aggregate
principal amount of its outstanding 5½% Senior Subordinated Notes
due 2022 (the “2022 Notes”) and approximately $414.3 million in
aggregate principal amount of its 4⅝% Senior Subordinated Notes due
2023 (the “2023 Notes”), as reflected in the table below.
Amounts
in millions (1) |
Principal Amount Outstanding
atDecember 31, 2015 |
First Quarter2016 Note
Repurchases (2) |
Principal Amount Covered by Exchange
Agreements |
Pro Forma Principal Amount
Outstanding |
6⅜% Senior Subordinated Notes due 2021 |
$ |
400.0 |
|
$ |
(4.0 |
) |
$ |
(123.4 |
) |
$ |
272.6 |
|
5½% Senior Subordinated Notes due 2022 |
1,250.0 |
|
(42.3 |
) |
(301.7 |
) |
906.1 |
|
4⅝% Senior Subordinated Notes due 2023 |
1,200.0 |
|
(106.0 |
) |
(414.3 |
) |
679.7 |
|
9% Senior Secured Second Lien Notes due 2021 |
— |
|
— |
|
482.9 |
|
482.9 |
|
Total |
$ |
2,850.0 |
|
$ |
(152.3 |
) |
$ |
(356.5 |
) |
$ |
2,341.2 |
|
(1) Some amounts do not sum due to rounding.(2) As previously
announced, the Company repurchased during the first quarter of 2016
a total of $152.3 million principal amount of Old Notes in
open-market transactions, consisting of $4.0 million in aggregate
principal amount of 2021 Notes, $42.3 million in aggregate
principal amount of 2022 Notes, and $106.0 million in aggregate
principal amount of 2023 Notes, for a total purchase price of $55.5
million, excluding accrued interest.
The New Notes will be senior in right of payment
to Old Notes which remain outstanding and to any other current or
future subordinated indebtedness of the Company. The New
Notes will mature on May 15, 2021 and will bear interest at a rate
of 9% per annum payable in cash. The New Notes will be fully
and unconditionally guaranteed, jointly and severally, by
subsidiaries of the Company representing substantially all of the
Company’s assets, operations and income and will be secured by
second-priority liens on substantially all of the assets that
secure the Company’s senior secured bank credit facility. The
Company expects that the exchanges will close on May 10, 2016,
subject to customary closing conditions.
The Company has not registered, and does not
currently intend to register, the New Notes or Shares under the
U.S. Securities Act of 1933, as amended, or under any state
securities laws, and the New Notes and Shares will be issued
pursuant to an exemption therefrom. The New Notes and Shares
may not be offered or sold within the United States or to or for
the account or benefit of any U.S. person, absent registration or
an applicable exemption from registration requirements.
This press release contains forward-looking
statements that involve risks and uncertainties that are based on
assumptions that management believes are reasonable based on
currently available information. There is no assurance that these
assumptions will prove to be correct. In addition, any
forward-looking statements represent the Company’s estimates only
as of today and should not be relied upon as representing its
estimates as of any future date. Denbury assumes no
obligation to update its forward-looking statements.
Denbury is an independent oil and natural gas
company with operations focused in two key operating areas: the
Gulf Coast and Rocky Mountain regions. The Company’s goal is
to increase the value of its properties through a combination of
exploitation, drilling and proven engineering extraction practices,
with the most significant emphasis relating to CO2 enhanced oil
recovery operations.
DENBURY CONTACTS:
Mark C. Allen, Senior Vice President and Chief Financial Officer, 972.673.2000
John Mayer, Investor Relations, 972.673.2383
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