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Foresight Energy pushes back deadline on bondholder deal

Aftermonths of negotiationswith holders of its 7.875% senior notes due 2021, Illinois Basin coal producerForesight Energy LPannounced that it has extended the time needed to finalized an agreement withthem.

Accordingto a May 9 filing, Foresight has extended the deadline for the to May 17 from theoriginal date of May 6. If the agreement is not finalized by that date, it maybe terminated automatically after three business days upon the partnership'sfailure to enter into it on or before May 17, according to a Form 8-K filed byForesight.

Negotiationshad been ongoing since a Delaware court ruled against the company in December2015, finding that Murray EnergyCorp.'s acquisition of a 34% noncontrolling interest in Foresight'sgeneral partner with the option to purchase 46% of the partnership for just $25million amounted to a change in the control of the company. filed a lawsuit arguing the change of control triggered a provision of an agreementrequiring Foresight to purchase the notes at 101% of the principal amounttendered in addition to accrued and unpaid interest.

Adeal between Foresight and lenders announced April 18 involves a $75 millionreduction in commitments under the revolving credit agreement with another $25million reduction at the end of 2016. The agreement also raises the creditagreement's interest rate 1% and includes other concessions.

Foresighthas also proposed a restructuring with a series of proposed transactions includingForesight Reserves LP's purchase of up to $106 million aggregate principalamount of outstanding notes held by non-affiliates of Foresight Energy. It alsoproposed an exchange for up to $300 million second lien senior one-yearconvertible payment-in-kind notes and up to $300 million in second-lien seniorsecured notes due August 2021.

Thepartnership said it extended an existing forbearance agreement entered into onDec. 18, 2015, with certain holders of its 7.875% senior notes due 2021. Thenew deadline is also set for May 17.