Boots & Coots International Well Control (AMEX:WEL) - Another Runt With Promise
Hey, guys. Take a look at this one. Looks like another runt with promise in the new year. I just bought a stake this morning.
FWIW, Jerry Winchester is an old Halliburton hand who I collaborated with several years back on a well control bid in Pakistan.
Razor
"Boots & Coots Completes Financial Restructuring Agreement"
Wednesday January 3, 9:02 am Eastern Time
Press Release
SOURCE: Boots & Coots International Well Control, Inc.
HOUSTON, Jan. 3 /PRNewswire/ -- Boots & Coots International Well Control, Inc. (Amex: WEL - news), announced today that it has concluded the restructuring of its subordinated debt with Prudential Insurance Company of America (``Prudential''). As previously disclosed, the Company had been in default under its subordinated note agreement with Prudential since the second quarter of 1999.
Prudential's aggregate claims of approximately $41 million through October 24, 2000 were resolved by the Company: (i) paying $12 million cash at closing; (ii) establishing $7.2 million of new subordinated debt; (iii) issuing $5 million of senior preferred stock; and (iv) issuing $8 million of convertible preferred stock. All interest payments and dividends are paid in kind and deferred for two years from the date of closing. Additionally, as a component of this transaction, Prudential has received newly issued warrants to purchase 8.8 million shares of the Company's common stock and the Company has agreed to reprice the existing common stock purchase warrants held by Prudential.
As a result of the transaction, the Company is current in its obligations to Prudential and the Company is in full compliance with all loan covenants. Furthermore, the Company has the right to repurchase, at a discount to face value, all of its debt, stock and warrants issued to Prudential for an agreed period.
Specialty Finance Fund I, LLC (``Specialty Finance''), the holder of the $8 million participation interest in the senior credit facility, has converted all but $1 million of its secured debt and accrued interest to convertible preferred stock. As previously announced, the Company recently paid the Comerica Bank -- Texas (``Comerica'') portion of its senior secured credit facility of approximately $13 million.
Given the net effect of the referenced transactions, the Company has reduced its total combined senior debt from Comerica and Specialty Finance from approximately $21 million to $1 million. Further, the Company has reduced Prudential subordinated debt and related claims of approximately $41 million to $7.2 million in subordinated debt and the equity securities previously referenced.
The Company's Chairman and Chief Executive Officer Larry Ramming said, ``The completion of this last significant step in our financial restructuring initiative allows us to once again focus on the opportunities inherent in an increasingly active market sector. By reducing total debt and related claims from approximately $62 million to $8.2 million, we have significantly de-leveraged our Company. With a restructured balance sheet and realigned services around our core emergency response, our proprietary products and Risk Management businesses, we are now fully prepared to get on with the business at hand. The WELLSURE® program continues to expand as do our Safe Guard programs for self insured customers.''
Boots & Coots International Well Control, Inc., Houston, Texas, is a global emergency response company that specializes, through its Well Control unit, in responding to and controlling oil and gas well emergencies, including oil and gas well blowouts and well fires as well as providing a complete menu of non-critical well control services as a result of its Well Control Alliance with Halliburton. Through its Special Services unit, the Company responds to marine oil spills and emergencies, refinery, pipeline, manufacturing and transportation emergencies, inclusive of hazardous material handling. Through internal growth, strategic acquisitions and continued alliance integration with Halliburton, the Company is expanding its role as an integrated, full-service, emergency-response company with the in-house ability to provide its expanded full-service prevention, response and restoration capabilities to the global needs of the oil and gas and petrochemical industries.
Forward-looking statements contained in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements involve risks and uncertainties which may cause actual results to differ from anticipated results, including risks associated with the timing and development of, and market acceptance of, the Company's services and products as well as risks of downturns in economic conditions generally, risks associated with competition and competitive pricing pressures, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including its latest Form 10-K at December 31, 1999.
Company Contact: Jerry Winchester
Boots & Coots Group
713-621-7911
Dominique Kasischke
Boots & Coots Group
713-621-7911
Investor Contact: Barry Gross
Gross Capital Associates
361-949-4999
Laurence Alpert
Columbine Financial
303-721-9990
SOURCE: Boots & Coots International Well Control, Inc.
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