HOUSTON, July 29 /PRNewswire/ -- KCS Energy, Inc. (NYSE: KCS) today
announced that the Company has entered into new forbearance agreements on each
of its revolving bank credit agreements which provide that the lenders will
refrain from exercising any rights and remedies not heretofore exercised until
October 5, 1999. The lenders have also rescinded their declaration that all
amounts outstanding under the credit agreements are immediately due and
payable and effectively waived the default rate of interest. The agreements
also preclude the Company from making interest payments on its senior and
subordinated notes.
Under the terms of the new agreements, the Company has committed to make
principal payments of $2.5 million each month commencing July 31, 1999. In
addition, a portion of the proceeds from the sale of any of the Company's oil
and gas properties will be dedicated to payment of principal under the
facilities. When the forbearance agreements expire, the lenders will be able
to exercise their rights under the credit agreements, including declaring the
principal balances immediately due and payable.
KCS Energy President and Chief Executive Officer James W. Christmas said,
"We are pleased that our lenders support the Company's objectives to reduce
our outstanding debt in an orderly fashion and continue our planned 1999
capital expenditure program of approximately $60 million. The Company
continues to work with its financial advisors, Houlihan Lokey Howard & Zuken,
to pursue a restructuring transaction that would result in a significantly
deleveraged the balance sheet and enable us to pursue growth opportunities."
KCS is an independent energy company engaged in the acquisition,
exploration, development and production of natural gas and crude oil with
operations in the Mid-Continent and Gulf Coast regions. The Company also
purchases reserves (priority rights to future delivery of oil and gas) through
its Volumetric Production Payments (VPP) program. For more information on KCS
Energy, Inc., please visit the Company's web site at
http://www.kcsenergy.com .
To receive KCS' latest news and other corporate developments via fax at no
cost, please call 1-800-PRO-INFO. Use company code KCS. See also
http://www.frbinc.com .
This press release contains forward-looking statements that involve a
number of risks and uncertainties. Among the important factors that could
cause actual results to differ materially from those indicated by such
forward-looking statements are delays and difficulties in developing currently
owned properties, the failure of exploratory drilling to result in commercial
wells, delays due to the limited availability of drilling equipment and
personnel, fluctuations in oil and gas prices, general economic conditions and
the risk factors detailed from time to time in the Company's periodic reports
and registration statements filed with the Securities and Exchange Commission.
SOURCE KCS Energy, Inc.
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Related links:
http://www.kcsenergy.com
CONTACT:
Kathryn M. Kinnamon, VP, Treasurer & Acting
CFO of KCS Energy Inc., 713-877-8006; or General Info, Marianne
Stewart, 212-661-8030, Analysts, Beth Lewis, 617-342-7003, Media,
Claudine Cornelis 212-661-8030, all of the Financial Relations
Board
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