LONDON (ShareCast) - (Sharecast News) - Latin America-focussed upstream oil and gas company Echo Energy updated the market on the continued restructuring of its existing debt to defer all cash interest payments during 2020 on Thursday, in a bid to preserve existing cash resources.
The AIM-traded firm confirmed an amendment to its €5m 8% secured convertible debt facility with Lombard Odier Asset Management Europe.

Under the amendment, it was agreed that the company has not and would not be required to make the previously-required 31 March quarterly interest payment, removing the previously-announced event of default, and that no further payments would be required under the loan before 31 March 2021.

Instead, 2020 interest under the loan will accrue and be calculated on the last business day of December, so as to form part of the principal amount of the loan.

For the period from the last business day of December and until maturity, interest would be calculated and payable on a quarterly basis.

As part of the amendment, the approval of the restructuring of the firm;s Luxembourg-listed €20m 8.0% secured notes, which would be put to the noteholders at an adjourned noteholder meeting on 22 May, was required within 90 days of the amendment.

"The amendment is a further important step in the successful restructuring of the company's debts, and provides a waiver of default for any non-payment of interest previously due under the loan," the Echo Energy board said in its statement.

"Entry of the amendment follows the successful April restructuring of the company's existing ?1m secured loan and, should noteholders approve the restructuring of the notes at the forthcoming adjourned noteholder meeting, the company will have completed the restructuring of all of its existing debt to defer all cash interest payments during 2020."

At 1222 BST, shares in Echo Energy were up 3.45% at 0.57p.

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