BK? BESV may have seen the last good news...
Anything anybody learned here about investing? This is a serious inquiry... like what were the red flags that this was coming? What happens when a company does a mission swerve? Any chance to sue the bastards?
Form 8-K for BLAST ENERGY SERVICES, INC.
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8-Jan-2007 Other Events
Item 8.01 Other Events.
As an update to our prior disclosure on Form 8-K filed on Friday, January 5, 2007, we have received written notice from our senior lender of various events of default under the loan agreements and related agreements with the senior lender. The senior lender notified us that it intends to charge any and all default amounts under the loan documents as a result of the events of default.
As previously disclosed, due to the inability of Blast to obtain full utilization of its rigs and due to a slowdown in market conditions, Blast has suspended interest payments on its senior debt, in order to conserve cash. At the current contractual interest rate, the monthly interest payment on the senior debt is approximately $370,000. Blast did not pay the interest on its due date. Following a three-day grace period that expires at the end of business on January 5, 2007, the terms of the senior debt provide that there is an event of default. Under the terms of the senior debt, following an event of default, additional interest accrues on the unpaid principal balance at the rate of 1% per month. In addition, an event of default would allow the senior lender to pursue remedies under the loan documents, which include accelerating the indebtedness, charging default interest, and entering foreclosure proceedings on the loan collateral.
Blast is presently in discussions with the senior lender to obtain a waiver, forbearance, or other accommodation relating to the event of default. It is uncertain at this time whether discussions with the senior lender will be successful, or if successful, whether the terms will be favorable to Blast. If Blast is not successful in obtaining a waiver, forbearance or other accommodation on acceptable terms, Blast may be forced to seek creditor protection under applicable bankruptcy laws or seek other accommodations from the senior lender.
AI
