Seadrill New Finance Limited Announces Extension of Forbearance Agreement

Rhea-AI Summary

Seadrill Limited announced an extension of a forbearance agreement regarding its 12.0% senior secured notes due 2025. This extension, agreed to with certain note holders, prevents them from exercising enforcement rights until March 24, 2021, or until the agreement is terminated. The forbearance aims to provide time for the Issuer and its stakeholders to negotiate a comprehensive restructuring of the balance sheet, potentially involving a court-supervised process. This follows Seadrill's Chapter 11 filings in Texas and a missed interest payment due on January 15, 2021.

Positive

• Extension of forbearance agreement allows more time for restructuring negotiations.
• Prevents immediate enforcement actions by note holders.

Negative

• Missed 4% cash interest payment due January 15, 2021.
• Company filed for Chapter 11 bankruptcy, indicating financial distress.

HAMILTON, Bermuda, March 9, 2021 /PRNewswire/ -- Seadrill Limited ("Seadrill" or the "Company") (OSE:SDRL, OTCQX:SDRLF) announces that Seadrill New Finance Limited (the "Issuer"), a subsidiary of the Company, has agreed to extend the existing forbearance agreement announced on 11 February 2021, and extended on 23 February 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 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 24 March 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.

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 of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

CONTACT:

seadrill@hawthornadvisors.com  

020 3745 4960

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/seadrill-limited/r/seadrill-new-finance-limited-announces-extension-of-forbearance-agreement,c3303500

View original content:http://www.prnewswire.com/news-releases/seadrill-new-finance-limited-announces-extension-of-forbearance-agreement-301243975.html

SOURCE Seadrill Limited

FAQ

What is the significance of the Seadrill forbearance agreement extension on March 9, 2021?

The extension allows Seadrill to negotiate restructuring without immediate enforcement actions from note holders.

What events led to Seadrill's extension of the forbearance agreement?

The extension was prompted by a missed interest payment and Chapter 11 filings by the company.

How does the forbearance agreement affect Seadrill's financial situation?

It provides temporary relief from enforcement actions, allowing negotiations for a comprehensive restructuring of its balance sheet.

When is the deadline for the Seadrill forbearance agreement?

The deadline for the extension is March 24, 2021, or until the agreement is terminated.

What financial obligations did Seadrill fail to meet prior to the forbearance agreement?

Seadrill failed to make a semi-annual 4% cash interest payment due on January 15, 2021.