Welcome!

News Feed Item

Tuscany International Drilling Inc. Announces Commencement of Restructuring Proceedings, Amended Credit Agreement, Support Agreement and Forbearance Agreement

CALGARY, ALBERTA -- (Marketwired) -- 02/03/14 -- Tuscany International Drilling Inc. ("Tuscany" or the "Company") (TSX:TID)(COLOMBIA:TIDC) announces that it and one of its subsidiaries, Tuscany International Holdings (U.S.A.) Ltd. ("Tuscany USA") have commenced proceedings under Chapter 11 of the United States Bankruptcy Code ("US Code") in the United States Bankruptcy Court for the District of Delaware (the "Chapter 11 Proceedings") to implement a restructuring of the Company's debt obligations and capital structure through a plan of reorganization under the US Code (the "Plan"). The Company and Tuscany USA also intend to commence ancillary proceedings in the Court of Queen's Bench of Alberta under the Companies' Creditors Arrangement Act ("CCAA") to seek recognition of the Chapter 11 Proceedings and certain related relief (the "CCAA Proceedings"). The Chapter 11 Proceedings and the CCAA Proceedings will provide for a stay of proceedings against the Company and Tuscany USA. Other than Tuscany USA, none of the Company's other subsidiaries are parties to the Chapter 11 Proceedings or the CCAA Proceedings. The proposed USD $35 million DIP Credit Facility described in this press release is expected to provide the Company with sufficient working capital to allow its subsidiaries to continue to operate in the normal course and meet their ongoing obligations over the course of the restructuring.

The Company will enter into a fourth amended and restated senior secured guaranteed credit agreement (the "Amended Credit Agreement") with Credit Suisse AG, Cayman Islands Branch, as administrative agent (the "Agent") and its various lenders. The Company has entered into a restructuring support agreement (the "Support Agreement") with the Agent and certain of its lenders. The Amended Credit Agreement and the Support Agreement are to facilitate the Company's restructuring under the US Code and the CCAA.

Pursuant to the Amended Credit Agreement, certain of the Company's lenders (the "Lenders") will provide a new credit facility to the Company under the Amended Credit Agreement (the "DIP Credit Facility") which will provide new funding to the Company in an aggregate principal amount of USD $35 million. The DIP Credit Facility is subject to Court approval and the new funds will be used to provide the Company and its subsidiaries with working capital to meet their ongoing obligations over the course of the restructuring. The DIP Credit Facility is subject to various conditions, including a condition that it be approved by the United States Bankruptcy Court for the District of Delaware pursuant to the US Code. Upon satisfaction or waiver of the conditions precedent contained in the Amended Credit Agreement, the Company will be indebted to the Lenders in the principal amount of approximately USD $237 million under the Amended Credit Agreement (the "Obligations"). The Company and the Lenders have also entered into a forbearance agreement pursuant to which the Lenders have agreed to forbear from enforcing their existing rights and remedies against the Company's subsidiaries in order to allow those subsidiaries to carry on business in the normal course during the Company's restructuring process.

The Company and the Lenders have agreed, subject to the terms of the Support Agreement, to pursue a balance sheet restructuring. The Support Agreement contemplates a bidding and marketing process to seek strategic alternatives that in accordance with bid procedures to be approved by the US Court (the "Bid Procedures") is intended to maximize value for stakeholders.

The foregoing summary description of the Support Agreement is not a complete description of the rights and obligations under such agreement, and interested parties are encouraged to review the copy of Support Agreement which has been filed by the Company on SEDAR.

During the restructuring proceedings the Company expects to continue with its day-to-day operations, and employee obligations and any trade payables incurred after today are expected to be paid or satisfied in the ordinary course. The DIP Credit Facility, together with current cash balances of and anticipated cash flow from operations, are expected to provide sufficient liquidity to the Company through the restructuring period.

Trading the Company's common stock on the Toronto Stock Exchange and the Colombian Stock Exchange has been halted, and the Company anticipates that the trading halt will remain in effect pending delisting of the common stock. The Company expects to complete the restructuring during the second quarter of 2014.

About Tuscany

Tuscany, a corporation headquartered in Calgary, Alberta, is engaged in the business of providing contract drilling and work-over services along with equipment rentals to the oil and gas industry. Tuscany is currently focused on providing services to oil and natural gas operators in South America. Tuscany has operating centers in Colombia, Brazil and Ecuador.

Further Information

For more information, please visit Tuscany's website at www.tuscanydrilling.com.

READER ADVISORIES

Statements in this news release contain forward-looking information including, without limitation, statements with respect to Tuscany's strategic alternatives, the restructuring of the assets and liabilities of the Company and the future financial position and focus of the Company. Readers are cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Tuscany.

These risks include, but are not limited to: (i) Tuscany's level of indebtedness and the acceleration of such indebtedness; Tuscany's ability to complete a strategic restructuring and refinancing transaction or alternative transaction, Tuscany's ability to negotiate and execute definitive documentation with respect to the restructuring (including Tuscany's ability to complete a new debtor-in-possession credit facility and new replacement senior secured credit facility) and obtain bankruptcy court approval thereof; (ii) the effects of the commencement of the CCAA and US Code proceedings on Tuscany and the interests of various creditors, equity holders and other constituents; (iii) bankruptcy court rulings and the outcomes of the proceedings in general; (iv) the length of time Tuscany will operate under the proceedings; (v) risks associated with third party motions in the proceedings, which may interfere with Tuscany's ability to consummate Tuscany's restructuring plan; (vi) the potential adverse effects of the proceedings on Tuscany's liquidity or results of operations; (vii) Tuscany's ability to execute its business and restructuring plan; (viii) increased legal and other costs related to the proceedings; (ix) Tuscany's ability to maintain contracts that are critical to its operation and to obtain and maintain normal terms and relationships with its suppliers, other service providers, customers, employees, stockholders and other third parties; (x) Tuscany's ability to retain key executives, managers and employees; (xi) Tuscany's ability to generate sufficient cash flow from operations or obtain adequate financing to fund its capital expenditures and meet working capital needs and its ability to continue as a going concern during the restructuring; (xii) the volatility of Tuscany's stock price; (xiii) the availability of capital on economic terms to fund Tuscany's significant capital expenditures and acquisitions; (xiv) Tuscany's ability to obtain adequate financing to pursue other business opportunities; (xv) regulatory and environmental risks associated with exploration, drilling and production activities; (xvi) the adverse effects of changes in applicable tax, environmental and other regulatory legislation; (xvii) a deterioration in the demand for Tuscany's products; (xviii) the risks and uncertainties inherent in estimating future revenues and the timing of expenditures; (xix) intense competition with companies with greater access to capital and staffing resources; (xx) the risks of conducting operations in foreign jurisdictions and the impact of pricing differentials, fluctuations in foreign currency exchange rates and political developments on the financial results of Tuscany's operations; and (xxi) other risks as described in reports that the Company files with securities regulators.

Any of these factors could cause the Company's actual results and plans to differ materially from those in the forward-looking statements. The risks outlined above should not be construed as exhaustive. The reader is cautioned not to place undue reliance on this forward-looking information. Tuscany does not undertake any obligation to update or revise any forward-looking statements except as expressly required by applicable securities laws.

The listing of Tuscany's common shares on the Colombian Stock Exchange does not imply a certification by the BVC of the value or the solvency of Tuscany.

The Toronto Stock Exchange has not reviewed, nor does it accept responsibility for the adequacy or accuracy of this release.

Contacts:
Tuscany International Drilling Inc.
Walter Dawson
President and CEO
(403) 265-8258

Tuscany International Drilling Inc.
Matt Moorman
CFO
(403) 265-8258

Tuscany International Drilling Inc.
Deryck Helkaa
CRO
(403) 265-8258
(403) 265-8793 (FAX)

Tuscany International Drilling Inc.
1950, 140-4th Avenue S.W.
Calgary, Alberta
www.tuscanydrilling.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
IoT offers a value of almost $4 trillion to the manufacturing industry through platforms that can improve margins, optimize operations & drive high performance work teams. By using IoT technologies as a foundation, manufacturing customers are integrating worker safety with manufacturing systems, driving deep collaboration and utilizing analytics to exponentially increased per-unit margins. However, as Benoit Lheureux, the VP for Research at Gartner points out, “IoT project implementers often ...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform and how we integrate our thinking to solve complicated problems. In his session at 19th Cloud Expo, Craig Sproule, CEO of Metavine, will demonstrate how to move beyond today's coding paradigm ...
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, wh...
So, you bought into the current machine learning craze and went on to collect millions/billions of records from this promising new data source. Now, what do you do with them? Too often, the abundance of data quickly turns into an abundance of problems. How do you extract that "magic essence" from your data without falling into the common pitfalls? In her session at @ThingsExpo, Natalia Ponomareva, Software Engineer at Google, provided tips on how to be successful in large scale machine learning...
In his general session at 18th Cloud Expo, Lee Atchison, Principal Cloud Architect and Advocate at New Relic, discussed cloud as a ‘better data center’ and how it adds new capacity (faster) and improves application availability (redundancy). The cloud is a ‘Dynamic Tool for Dynamic Apps’ and resource allocation is an integral part of your application architecture, so use only the resources you need and allocate /de-allocate resources on the fly.
Your business relies on your applications and your employees to stay in business. Whether you develop apps or manage business critical apps that help fuel your business, what happens when users experience sluggish performance? You and all technical teams across the organization – application, network, operations, among others, as well as, those outside the organization, like ISPs and third-party providers – are called in to solve the problem.
Information technology is an industry that has always experienced change, and the dramatic change sweeping across the industry today could not be truthfully described as the first time we've seen such widespread change impacting customer investments. However, the rate of the change, and the potential outcomes from today's digital transformation has the distinct potential to separate the industry into two camps: Organizations that see the change coming, embrace it, and successful leverage it; and...
SYS-CON Events announced today that Roundee / LinearHub will exhibit at the WebRTC Summit at @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LinearHub provides Roundee Service, a smart platform for enterprise video conferencing with enhanced features such as automatic recording and transcription service. Slack users can integrate Roundee to their team via Slack’s App Directory, and '/roundee' command lets your video conference ...
Digital transformation is too big and important for our future success to not understand the rules that apply to it. The first three rules for winning in this age of hyper-digital transformation are: Advantages in speed, analytics and operational tempos must be captured by implementing an optimized information logistics system (OILS) Real-time operational tempos (IT, people and business processes) must be achieved Businesses that can "analyze data and act and with speed" will dominate those t...
The Jevons Paradox suggests that when technological advances increase efficiency of a resource, it results in an overall increase in consumption. Writing on the increased use of coal as a result of technological improvements, 19th-century economist William Stanley Jevons found that these improvements led to the development of new ways to utilize coal. In his session at 19th Cloud Expo, Mark Thiele, Chief Strategy Officer for Apcera, will compare the Jevons Paradox to modern-day enterprise IT, e...
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Bradley Holt, Developer Advocate a...
More and more companies are looking to microservices as an architectural pattern for breaking apart applications into more manageable pieces so that agile teams can deliver new features quicker and more effectively. What this pattern has done more than anything to date is spark organizational transformations, setting the foundation for future application development. In practice, however, there are a number of considerations to make that go beyond simply “build, ship, and run,” which changes ho...
SYS-CON Events announced today the Kubernetes and Google Container Engine Workshop, being held November 3, 2016, in conjunction with @DevOpsSummit at 19th Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA. This workshop led by Sebastian Scheele introduces participants to Kubernetes and Google Container Engine (GKE). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, students learn the key concepts and practices for deploying and maintainin...
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service. In his session at 19th Cloud Exp...
There is growing need for data-driven applications and the need for digital platforms to build these apps. In his session at 19th Cloud Expo, Muddu Sudhakar, VP and GM of Security & IoT at Splunk, will cover different PaaS solutions and Big Data platforms that are available to build applications. In addition, AI and machine learning are creating new requirements that developers need in the building of next-gen apps. The next-generation digital platforms have some of the past platform needs a...