Niko Resources amends loan agreement to get waiver of some covenants

By Jennifer Chiou

New York, Feb. 12 – Niko Resources Ltd. announced that it reached an agreement with the institutional lenders of its $340 million senior term loan facilities to obtain a waiver and amend certain terms.

According to a news release, the company obtained a waiver until Dec. 15, 2015 of some financial covenants and undertakings set out in the agreement, including the senior debt to EBITDAX and proved plus probable reserves for the D6 Block in India to senior debt.

The company's operating results for the trailing four quarters ended Dec. 31, 2014 were not sufficient to satisfy the senior debt to EBITDAX financial covenant in the original facilities agreement. The amendment to the facilities agreement ensured that there was not an event of default under that agreement.

The waiver will apply through June 16 if milestones related to the potential sale of the company's interest in the D6 Block are not met by a certain date, the release said.

The changes, among other things, also require the company to achieve certain milestones related to the above-mentioned potential sale and to maintain specified minimum cash balances.

The release stated that there are restrictions on capital expenditures for non-core assets and general and administrative expenditures.

In addition, Niko Resources has to offer to make a principal repayment of $5 million on the term loan by Feb. 27.

Calgary, Alta.-based Niko Resources is an oil and natural gas exploration and production company with operations in India, Bangladesh, Indonesia, Madagascar, Pakistan and Trinidad.

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