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Abraxas extends consent solicitation for 11½% notes, ups payment
New York, June 17 - Abraxas Petroleum Corp. said it has again extended its solicitation of noteholder consents to proposed changes in the indenture of its 11½% secured notes due 2007 and has increased the consent payment.
The company is now offering $15 per $1,000 up to a total of $841,000 instead of $10 per $1,000.
The solicitation was extended to 5 p.m. ET on June 18, subject to possible further extension, from the previous June 17 deadline.
As previously announced, Abraxas - a San Antonio-based oil and gas exploration and production company - said on June 3 that it had begun a consent solicitation for its $128 million principal amount of 11½% notes, seeking to modify the covenants limiting it to $10 million a year in capital expenditures.
It initially set an expiration deadline of 5 p.m. ET on June 14, which has now been extended.
The company said that under the proposed amendment, capital expenditures would be limited so that the ratio of the company's consolidated EBITDA to the sum of consolidated cash interest expense plus capital expenditures minus net proceeds from qualifying equity security or subordinated debt offerings could not be less than 1.0-to-1.0 for any fiscal year beginning with the fiscal year ending Dec. 31, 2004.
Abraxas needs consents from holders of a majority of the notes. It will pay $10 per $1,000 principal amount to holders who consent to the changes.
If the consents received exceed the majority requirement, then the consent payment will be paid on a pro rata basis.
Guggenheim Capital Markets LLC is solicitation agent (212 381-7500). Global Bondholder Services Corp. is tabulation agent and information agent (212 430-3774).
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