Hornbeck Offshore Announces Private Offering Of $260,000,000 Of Convertible Senior Notes

Hornbeck Offshore Services, Inc.

announced today that it intends, subject to market and other conditions, to offer $260,000,000 aggregate principal amount of convertible senior notes due 2019 (the "Convertible Notes") in a private offering within the United States to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). The notes will be guaranteed on a senior, unsecured basis by the same subsidiaries of the Company that currently guarantee its revolving credit facility and other outstanding senior notes. The Company expects to grant a 30-day option to the initial purchasers of the Convertible Notes for up to an additional $40,000,000 aggregate principal amount of the Convertible Notes. The Convertible Notes are expected to pay interest semiannually and will be convertible into cash, shares of the Company's common stock or a combination of cash and shares of the Company's common stock, at the Company's election, based on a conversion rate to be determined. The Convertible Notes will mature in 2019, unless repurchased or converted in accordance with their terms prior to such date. Prior to June 1, 2019, the Convertible Notes will be convertible only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. In connection with the offering, the Company expects to enter into convertible note hedge transactions in respect of its common stock with one or more affiliates of the initial purchasers of the Convertible Notes (the "Option Counterparties"). These convertible note hedge transactions are expected to reduce the potential dilution upon future conversion of the Convertible Notes. In addition, the Company expects to enter into separate warrant transactions with the Option Counterparties at a higher strike price. The warrant transactions could separately have a dilutive effect to the extent that the market value per share of the Company's common stock exceeds the applicable strike price of the warrants. If the initial purchasers exercise their option, the Company expects to enter into additional convertible note hedge and warrant transactions with the Option Counterparties.