WTI - W&T Offshore Announces Liquidity-Enhancing Modifications to the Non-Recourse Term Loan with Munich Re | Benzinga
HOUSTON, March 18, 2024 (GLOBE NEWSWIRE) -- W&T Offshore, Inc. (NYSE:WTI) ("W&T" or the "Company") today announced modifications to the first-lien non-recourse term loan (the "Term Loan") between its wholly-owned special purpose vehicles (the "SPVs") and Munich Re Reserve Risk Financing, Inc. ("MRRF"), which is expected to provide additional liquidity to the Company over 2024 without increasing the Company's net leverage. The Term Loan was initially arranged on May 19, 2021 ("Closing Date") and had a principal balance of $215 million which has been amortized down to around $114 million as of December 31, 2023. There have been a few alterations to the Credit Agreement signed by the SPVs and MRRF on May 19, 2021 (the "Original Credit Agreement").
Key highlights of the transaction are as follows:
- Effective extension of weighted average maturity by deferring principal payments of around $30 million that would have been due over the four quarters of 2024 – no change in the final maturity date of May 19, 2028 ("Maturity Date"); Mandatory principal repayments to restart in first quarter of 2025 with the option, but not obligation, to catch up on deferred amortization through excess cash flow sweep;
- No change in coupon (will stay at 7.00% fixed rate) and cash interest will be due each quarter of 2024 on the remaining principal balance (around $114 million as of December 31, 2023);
- The revised optional prepayment premium schedule will be as follows:
- Through and including the third anniversary of the Closing Date, a cash amount equal to the present value at 7.00% discount rate of the aggregate dollar amount of scheduled interest payments on the Term Loan that would have become due and payable from the applicable prepayment date through and including the Maturity Date (similar to the Original Credit Agreement),
- If such prepayment or repayment is made on any date from the third anniversary of the Closing Date through and including the fourth anniversary of the Closing Date, a cash amount equal to 3.0% (3.0% in the Original Credit Agreement as well) of the prepaid or repaid principal amount of the Term Loan,