W&T Offshore holders exchange 78.9% of 8½% notes by early deadline

By Susanna Moon

Chicago, Aug. 31 – W&T Offshore, Inc. said investors had tendered for exchange $710.2 million, or 78.9%, of its $900 million of outstanding 8½% senior notes due 2019 as of the early deadline at 5 p.m. ET on Aug. 30.

In exchange for the 8½% notes, the company is offering up to 76.59 million common shares, $202.5 million principal amount of new senior second-lien pay-in-kind toggle notes due 2020 and $180 million principal amount of new senior third-lien PIK toggle notes due 2021.

The exchange and consent solicitation will continue until 5 p.m. ET on Sept. 1, extended previously from 5 p.m. ET on Aug. 29.

The company amended the exchange offer and consent solicitation on Aug. 16, extending the early participation date from 5 p.m. ET on Aug. 8 and eliminating the minimum tender condition and changing the payment on offer.

Before the change, the company was offering up to 62.1 million shares. The third-lien notes will be issued in lieu of the unsecured senior PIK toggle notes due 2021 described in the original offer.

The total exchange value for each $1,000 principal amount of notes tendered for exchange by the early participation date is 85.1 shares (increased from 69 shares), $225 principal amount of new second-lien notes and $200 principal amount of new third-lien notes.

For each $1,000 principal amount of notes tendered for exchange after the early deadline, holders will receive 85.1 shares (increased from 69 shares), $200 principal amount of new second-lien notes and $200 principal amount of new third-lien notes.

The total exchange value includes an early tender premium of $25 principal amount of new second-lien notes per $1,000 principal amount.

Holders will also receive a cash payment for accrued interest up to but excluding the settlement date.

The company is soliciting consents from holders of the 8½% notes to a proposed amendment to the note indenture in order to permit the issuance of the new second- and third-lien notes. Holders who tender will be deemed to have consented to the amendment.

The exchange offer is conditioned on shareholder approval for the stock issue. It is no longer conditioned on a minimum of 95%, or $855 million, of notes being tendered for exchange.

The offer is only being made to holders who are qualified institutional buyers under Rule 144A or those who are not U.S. persons under Regulation S.

Evercore Group LLC is the dealer manager. The information agent is D.F. King & Co., Inc. (877 536-1561, 212 269-5550 or dfking.com/wti).

W&T Offshore is a Houston-based oil and natural gas exploration and production company.

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