 "Aban subsidiary bond holders okay changes in agreement")
The company said lack of new drilling contracts for Aban Group's various rigs, among other reasons, negatively impacted the ability to set aside funds to redeem the bonds on the original final maturity date.
"The proposed resolution obtained 90.58% of the votes, and the proposal was adopted according to the voting requirements of the bond agreement. The bond agreement will therefore be changed as set out in the summons to the meeting," said a notice from the bond holders' meeting signed by an official of Nordic Trustee ASA, which manages third-party contractual rights on the basis of individual assignments.
Earlier, the company had said it will seek time from bond holders to repay the $87.5 million outstanding amount, owing to the delay in payment by oil companies and poor market conditions to raise additional funds.
The company, in a presentation in October, this year, said Deep Drilling1 Pte Ltd issued a $125 million senior secured bond guaranteed by Deep Drilling Invest Pte Ltd in December 2011 with a 4 year tenor.
The bond issue is now approaching its final maturity date on December 21, 2015 with $87.5 million outstanding after have been repaid by $37.5 million in scheduled repayments. The bond issue is secured on a first priority basis in the jack up rig Deep Driller 1 on contract with Pemex until early September 2016.
The changes in the proposed amendments include an agreement to repay $22.5 million principal plus accrued interest on December 21, 2015, with principal amount of $65 million remaining.
The final maturity date was proposed to postpone until December 21, 2017 and the interest rate has been increased to 15% per annum from December 21, 2015 and paid quarterly. The bond agreement dated December 21, 2011 was for 12% Deep Drilling 1 Pte Ltd Senior Secured Callable bond.
In its summons to the bond holder, earlier this month, the company requested them to take into consideration that payments from Pemex, which is the end user of the Rig, are increasingly delayed.
The last payment for the Rig was made in October, 2015 for drilling in July, with no further payments expected in 2015 as Pemex has yet to permit invoicing.
By year-end 2015, a total of five months' hire of approximately $21.5 million at 95% efficiency, is expected to be outstanding for the Rig.
"The terms of the contract (including day rate and duration) remain unchanged, and the outstanding amount is not disputed. The delay in payments combined with early termination of Deep Driller 7 and a lack of new drilling contracts for Aban Group's other rigs, has negatively impacted the ability to set aside funds to redeem the bonds," said the company on December 7, 2015.
In a presentation in October, this year, the company said that Deep Drilling 1's revenue backlog was $33.7 million and its accounts receivable $8.3 million. Deep Drilling Invest's revenue backlog was around $62.1 million and its accounts receivable $215.9million. Of Deep Drilling Invest's eight jackup rigs, only Deep Driller 1 has firm contract backlog extending into 2016, added the company.
"Payments from the oil companies are increasingly delayed and the guarantor's accounts receivable have increased by $55.6 million (35%) in the six month period ending September 30, negatively impacting the ability to set aside funds to redeem the bonds in full," said the company adding that raising additional common equity in the current market is challenging.
Refinancing the bonds with a new bond is prohibited under a negative pledge provision contained in the main bank financing agreements and would thus require approval from all bank 19 lenders of the Aban Group, it added in October.
