GMX elects PIK option to pay Dec. 1 interest payment for 2017 notes

By Toni Weeks

San Diego, Oct. 17 - GMX Resources Inc. said it has elected the PIK option for making its Dec. 1 semiannual interest payment to noteholders of record as of Nov. 15 for the company's 2017 senior secured notes, according to an 8-K filing with the Securities and Exchange Commission.

The company may choose either the cash or the pay-in-kind election for the June 1 and Dec. 1 interest payments each year. The PIK election includes a 9% per year coupon paid in cash and a 4% per year coupon paid in the form of additional notes, whereas the cash option is an 11% per year cash interest payment.

Selecting the PIK interest payment will increase the outstanding principal balance of the 2017 senior secured notes by $5.8 million, the filing noted.

Oklahoma City-based GMX Resources explores, develops and produces properties for the production of crude oil and natural gas.

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