Echo Energy, the Latin American focused upstream oil and gas company, provides a further update on the proposed restructuring of the Company's existing debt to defer all cash interest payments during 2020 with a view to enabling the Company to preserve existing cash resources.

The Company announces entry of an amendment to the Company's £1.0 million 12.0% loan facility such that the Company has not been required to make the previously required quarterly interest payment under the £1m Loan on 31 March 2020 and no further payment will be required of the Company under the £1m Loan prior to 31 March 2021. 

In addition, the Company confirms that negotiations to agree the deferral of 2020 interest payments with the holder of the Company's EUR 5.0m 8.0% secured convertible debt facility (the "EUR 5m Loan") continue to progress well and that the loan holder has indicated their continued support of the Company.

In order to provide the parties with the time required to conclude an amendment to the EUR 5m Loan, the holder of that loan has confirmed to the Company that, whilst the parties remain in constructive negotiations in relation to the amendment, it will waive default rights under the EUR 5m Loan for the non-payment of 31 March 2020 interest.  The Company looks forward to updating shareholders on the amendment to the EUR 5m Loan shortly.

As announced by the Company on 25 March 2020, deferral of interest payments under the Company's Luxembourg listed EUR 20.0m 8.0% secured notes will required approval at a meeting of the holders of the Notes. The Company has notified the Note Holders of the Company's proposal to delay payment of interest due on the Notes on 31 March 2020. The Company is finalising its proposals in this regard, and where relevant taking note of any representations made by Note Holders, ahead of convening a Note Holder general meeting. The Company confirms that it has not met the 31 March 2020 Notes interest payment and as a result the Company will be in default on the Notes until such time as Note Holder approval is received for a restructuring of Note interest payments. The Company will convene a meeting of the Note Holders as soon as is reasonably practicable.

£1m Loan amendment

The £1m Loan has been amended such that, with effect from 1 January 2020, interest on the £1m Loan will now accrue at an unchanged annual interest rate of 12.0% and, at the end of each quarterly interest period, be added to the aggregate principal amount owing under the £1m Loan, for payment on maturity. The Company has agreed that, as amended, the £1m Loan will now be repayable as follows: (a) £100,000 in March 2021; (b) three quarterly instalments of £50,000 on the last business day of the relevant month commencing in June 2021; and (c) the balance of £750,000, together with accrued interest, on 8 March 2022. The other terms of the £1m Loan remain unchanged.

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