Solstad seeks to defer bond payments for one year through December

By Susanna Moon

Chicago, Dec. 6 – Solstad Offshore ASA, formerly Solstad Farstad ASA, is seeking to defer paying principal and interest on its senior bond issue 2014/2019 because it is being constrained by its “liquidity situation,” according to a notice by Nordic Trustee AS.

The Solstad group has requested a majority of its secured lenders to defer principal and interest, which is being negotiated with the final terms yet to be determined.

The loan deferral will require that bondholders agree to suspend interest and amortization payments for one year from Dec. 20 through Dec. 20, 2019.

The deferral will be in effect through the earliest of the one-year period, termination of the senior deferral agreement and the date on which a liquidator is appointed for any Solstad subsidiary.

Bondholders are being summoned to a meeting set for Dec. 19 in Oslo.

Specifically, the issuer is looking to define the term majority secured creditors to mean lenders representing at least two-thirds of the Solstad group's secured bank loans. For this calculation, the lease financing of the vessel “Normand Maximus” will not be included in the calculation, according to the notice.

The term “senior deferral agreement” will mean either an agreement between the obligors in the Solstad group and the majority secured creditors that will suspend payment of principal and interest to the majority secured creditors for a period of time and may include a cash sweep mechanism with a threshold amount, and will include undertakings from the majority secured creditors not to accelerate or enforce any of the debt owing to them from the Solstad Group as a result of nonpayment of principal and interest or breach of financial covenants for the tenor of the senior deferral agreement and subject to the terms of the senior deferral agreement, or a waiver from the majority secured creditors of the payment obligations of the Solstad Group having the same effect as or an agreement set out in direct continuation of a waiver.

During the deferral period, the company will operate its business as usual, the notice said.

In order to form a quorum, at least one-half of the voting bonds must be represented at the meeting. To pass, bondholders representing at least two-thirds of the bonds represented must vote in favor of it.

Arctic Securities AS (+47 48403260 or anders.eide@arctic.com) is the financial adviser.

Solstad’s fleet is engaged in the offshore petroleum industry. The company is based in Skudeneshavn, Norway.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.