Rex Energy Corporation (Nasdaq:REXX) announced that it has closed two privately negotiated exchange transactions with certain holders of the company's securities, including the 8.875% Senior Notes due 2020 ("2020 Notes"), the 6.250% Senior Notes due 2022 ("2022 Notes"), the Series A 6.00% Convertible Perpetual Preferred Stock ("Preferred Stock"), and the 1.00%/8.00% Senior Secured Second Lien Notes due 2020 (the "Second Lien Notes"), in which those holders agreed to exchange their existing securities for shares of the company's common stock.
2020 Notes and 2022 Notes
Rex Energy executed a privately negotiated exchange pursuant to which the holder exchanged $26.9 million in aggregate principal amount of the 2020 Notes and 2022 Notes and waive all accrued and unpaid interest for approximately 5.2 million shares of common stock. With this transaction, the company's interest savings in 2016 and 2017 will be $1.8 million and $2.1 million, respectively. Total interest expense savings from the exchange will be approximately $11.6 million.
Preferred Stock and Second Lien Notes
The company executed a second privately negotiated exchange with a different holder pursuant to which the holder agreed to exchange $13.8 millionin face value of the Preferred Stock and waive all accrued and unpaid dividends, and to exchange $2.2 million in aggregate principal amount of the Second Lien Notes and waive all accrued and unpaid interest, for an combined total of approximately 1.9 million shares of common stock. With this transaction, the company will save approximately $0.8 million in dividend payments per year.
"These exchanges represent another positive step in our efforts to improve our balance sheet and enhance our overall liquidity profile," said Tom Stabley, Rex Energy's President and Chief Executive Officer. "With a combined $29.1 million reduction in overall debt and over $12.0 million in savings on interest payments, we are making good progress on our balance sheet and liquidity improvement initiatives and will continue to pursue other strategic enhancements while we weather a challenging commodity price environment."Connect with us on Facebook and Twitter!