SDRL - Seadrill New Finance Limited Announces Extension of Forbearance Agreement

Rhea-AI Summary

Seadrill Limited has announced an extension of its forbearance agreement related to its 12.0% senior secured notes due 2025. This agreement, initially disclosed on April 19, 2021, allows the Note Holders to refrain from enforcing rights due to defaults, including a missed cash interest payment on January 15, 2021. The forbearance aims to provide Seadrill New Finance Limited and its stakeholders additional time to negotiate a comprehensive restructuring of its balance sheet, possibly through a court-supervised process, until June 18, 2021.

Positive

• Extension of forbearance agreement provides time for restructuring negotiations.

Negative

• Missed semi-annual 4% interest payment due on January 15, 2021.
• Filing for Chapter 11 bankruptcy in the U.S. adds financial risk.

HAMILTON, Bermuda, June 3, 2021 /PRNewswire/ -- Seadrill Limited ("Seadrill" or the "Company") (OSE:SDRL, OTCPK:SDRLF) announces that Seadrill New Finance Limited (the "Issuer"), a subsidiary of the Company, has agreed to further extend the existing forbearance agreement announced on 19 April 2021, and extended on 17 May 2021 and 27 May 2021, with respect to the 12.0% senior secured notes due 2025 (the "Notes") with certain holders of the Notes (the "Note Holders").

Pursuant to the forbearance agreement, as extended, the consenting Note Holders have agreed not to exercise any enforcement rights with respect to the Issuer and any subsidiary of the Issuer which is an obligor under the Notes to, or otherwise take actions in respect of, certain events of default that may arise under the Notes as a result of, amongst other things, the Issuer not making the semi-annual 4% cash interest payment due to the senior secured noteholders on 15 January 2021 in respect of their Notes and the filing of Chapter 11 cases in the U.S. Bankruptcy Court for the Southern District of Texas by the Company and certain of its consolidated subsidiaries (excluding the Issuer and its consolidated subsidiaries) until and including the earlier of 18 June 2021 and any termination of the forbearance agreement.

The purpose of the forbearance agreement is to allow the Issuer and its stakeholders more time to negotiate on the heads of terms of a comprehensive restructuring of its balance sheet. Such a restructuring may involve the use of a court-supervised process.

About Seadrill

Seadrill is a leading offshore drilling contractor utilizing advanced technology to unlock oil and gas resources for clients across harsh and benign locations across the globe. Seadrill's high quality, technologically advanced fleet spans all asset classes allowing its experienced crews to conduct its operations from shallow to ultra-deep-water environments. The company operates 43 rigs, which includes drillships, jack-ups and semi-submersibles.

Seadrill is listed on the Oslo Børs and OTCPK. For more information, visit https://www.seadrill.com/

FORWARD LOOKING STATEMENTS

This news release includes forward looking statements. Such statements are generally not historical in nature, and specifically include statements about the Company's plans, strategies, business prospects, changes and trends in its business, the markets in which it operates and its restructuring efforts. These statements are made based upon management's current plans, expectations, assumptions and beliefs concerning future events impacting the Company and therefore involve a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, which speak only as of the date of this news release. Consequently, no forward-looking statement can be guaranteed. When considering these forward-looking statements, you should keep in mind the risks described from time to time in the Company's regulatory filings and periodical reporting. The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for the Company to predict all of these factors. Further, the Company cannot assess the impact of each such factor on its business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward looking statement.

This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

CONTACT:
seadrill@hawthornadvisors.com 
020 3745 4960

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SOURCE Seadrill Limited

FAQ

What is the purpose of Seadrill's forbearance agreement extension?

The forbearance agreement extension allows Seadrill New Finance Limited to negotiate a comprehensive restructuring of its balance sheet.

What dates are significant for the forbearance agreement related to SDRLF?

The forbearance agreement was first announced on April 19, 2021, and extended on May 17 and 27, 2021, with a deadline of June 18, 2021.

What are the consequences of not making the interest payment by Seadrill?

Failure to make the semi-annual interest payment could lead to enforcement actions by the Note Holders.

What company filed for Chapter 11 related to SDRLF?

Seadrill Limited and certain consolidated subsidiaries filed for Chapter 11 in the U.S. Bankruptcy Court.