Each one in plain English, with the numbers worked through for a shareholder.
22 Nov 2010material agreement▲ GoodMajor
Energy XXI agreed to its largest deal yet: a $1.012 billion cash purchase of nine shallow-water Gulf of Mexico shelf fields from ExxonMobil and Mobil affiliates, sitting between its existing South Timbalier and Main Pass operations. The deal is to be financed with a $450 million term loan, $350 million of revolver borrowings and cash on hand, and comes with a roughly $200 million estimated plugging-and-abandonment liability and a $225 million standby letter of credit to cover it - a transformational scale-up that also loads the company with major legacy decommissioning obligations.
Lenders waived credit-agreement covenants to let Energy XXI Gulf Coast use about $133 million of the October equity-raise proceeds to redeem its 16% Second Lien Notes (by March 2011) and, once those were retired, its 10% Senior Notes (by September 2011) - the mechanics behind the ongoing high-cost-debt payoff.
27 Oct 2010capital raising announcement▲ GoodMajor
Energy XXI launched another round of equity raises - 9.5 million common shares plus $200 million of new convertible preferred stock - earmarked to buy back $119 million of its expensive 16% Second Lien Notes and repay $91.5 million of revolver debt, continuing to unwind the costly 2009 crisis-era financing.
Confirming the recovery from its 2009 crisis-era lows, Energy XXI's credit facility borrowing base was back up to $350 million, and lenders amended the agreement to let Gulf Coast fund up to $25 million to induce early conversion of the 7.25% preferred stock and up to $9 million a year for preferred dividends - directly financing the deleveraging program underway.
15 Oct 2010capital raising announcement▲ GoodMajor
Energy XXI expanded the preferred-stock conversion program, exchanging another 347,500 preferred shares for common stock, cutting the outstanding preferred balance to 680,500 shares.
Energy XXI began retiring its 7.25% convertible preferred stock, exchanging 72,000 preferred shares for common stock under a formula tied to the stock's recent trading price - part of a push to simplify its capital structure as the post-crisis recovery took hold.
Energy XXI launched concurrent public offerings of 90 million common shares and $75 million of convertible preferred stock to fund the MitEnergy acquisition, alongside underwriter over-allotment options.
