Denbury Resources Inc. (NYSE: DNR) has entered into exchange agreements with holders of its $610 million senior notes, due 2022 and 2023, in exchange for roughly $466 million in new notes, the company said Nov. 30.
The new notes consist of approximately $382 million in aggregate principal amount of 9.25% senior secured second lien notes due 2022 and approximately $85 million in 3.5% convertible senior notes due 2024.
The company will exchange the new notes for approximately $364 million of its outstanding 5.5% senior subordinated notes due 2022, reducing the outstanding principal amount of the 2022 notes to $409 million. And also exchange approximately $246 million in aggregate principal amount of its 4.625% senior subordinated notes due 2023, reducing the outstanding principal amount of the 2023 notes to $377 million.
The new second lien notes will mature on March 31, 2022 and will bear interest at a rate of 9.25% per annum payable in cash and the new convertible notes will mature on March 31, 2024 and will bear interest at a rate of 3.50% per annum payable in cash.
In November, Denbury also said its $1.05 borrowing base under its senior secured bank credit facility was reaffirmed in conjunction with its fall borrowing base redetermination.
“This exchange is another positive step on our path toward improving our balance sheet, and will result in a debt principal reduction of $144 million upon closing, increasing to approximately $228 million assuming the convertible notes fully convert into 39 million shares,” Chris Kendall, Denbury’s CEO and president, said.
“This is a prime example of our ability to use the flexibility in the company’s capital structure to positively impact the company and its stakeholders.”
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