PGS ASA

Capital/Financing Update • Oct 21, 2020

PGS ASA: Binding Agreements with Majority of Lenders

PGS ASA: Binding Agreements with Majority of Lenders

October 21, 2020: Oslo, Norway, PGS ASA (the "Company" or "PGS") has, further to

its announcement on September 25, 2020, regarding its agreement in principle on

main terms with its lenders, now entered into a lock-up agreement (the "Lock-Up

Agreement") with lenders representing, in aggregate, 79.6% of its ~$350 million

revolving credit facility ("RCF") and ~$522 million term loan B facility

("TLB"). PGS has also entered into a consent and amendment agreement (the

"Consent and Amendment Agreement") with the representative of 100% of the

finance parties under its ~$300 million export credit facilities ("ECF").

Overview of the Transactions

As previously announced, the agreed terms of these transactions (the

"Transactions") will, once consummated, enable PGS to extend its current near-

term maturity and amortization profile under its RCF/TLB and ECF facilities by

approximately two years. Together with the cost saving initiatives previously

announced, the Transactions will strengthen PGS's liquidity profile in the

currently challenging operating environment.

The main terms agreed pursuant to the Lock-Up Agreement and the Consent and

Amendment Agreement are as follows:

* The $135 million RCF due 2020, the $215 million RCF due 2023 and the ~$2

million TLB due 2021 will each be converted into a new TLB on the same terms

as the ~$520 million 2024 TLB

* Quarterly amortization payments of up to 5% per annum of the original

principal amount of the ~$520 million 2024 TLB will be replaced by the new

amortization payments described below

* The post transaction total debt under these credit facilities of ~$872

million (subject to any increases in principal due to payment-in-kind fees

and any reduction in principal due to lenders electing to exchange part of

their existing debt into new convertible bonds; see further below) maturing

in March 2024 will have following amortization profile (payable pro-rata to

all TLB lenders):

* ~$135 million amortization payment due in September 2022

* $200 million amortization payment due in September 2023

* ~$9 million quarterly amortization starting March 2023

* Quarterly amortization payments totalling ~$106 million due over the next

two years under the ECF will be deferred and repaid over four quarters

starting December 2022

* The current excess cash flow sweep for the RCF/TLB facilities will be

replaced by an excess liquidity sweep for any liquidity reserve in excess of

$200 million at each quarter end, with such amounts to be applied against

(i) the deferred amortization amounts under the ECF and (ii) the ~$135

million TLB amortization, until they have both been paid in full;

thereafter, any liquidity reserve in excess of $175 million at each quarter

end will be applied against the remaining TLB amortizations

* The financial maintenance covenants will be amended, with the net leverage

ratio to be 4.5x through June 30, 2021, 4.25x through December

31, 2021, 3.25x through December 31, 2022 and 2.75x thereafter

* The lenders' security package will be strengthened

* Total fees across the lender groups of up to ~$7.6 million will be payable

in cash and up to ~$9.9 million will be payable in kind

* An up to ~NOK 116.2 million 3-year 5% unsecured convertible bond (the "CB")

which can be converted into new PGS shares at NOK 3 per share (up to a

maximum of 38,720,699 shares, equalling 10% of the currently outstanding PGS

shares) will be issued by PGS. Lenders under the RCF and TLB facilities will

have a pro rata preferential right to subscribe for the CB against

conversion of a corresponding amount of their existing secured loans. To the

extent the CB is not fully subscribed, certain lenders under the TLB will

(i) subscribe for 80% of the unallocated amount for cash and (ii) have the

right to subscribe for the remaining 20% of the unallocated amount for cash.

PGS will be able to require that bondholders convert the CB into shares if

the PGS share price exceeds NOK 6 for 30 consecutive trading days

Support for the Transactions/Implementation

The representative of all of the ECF financing parties has entered into the

Consent and Amendment Agreement which (i) provides for the proposed amendments

to the ECF and (ii) maintains the forbearance arrangements (including

restrictions on acceleration and enforcement action) (the "Forbearance") as put

in place with the ECF following the previous market announcement on September

25, 2020. The non-amendment terms of the Consent and Amendment Agreement are

effective immediately and are subject to customary termination events.  The

amendment terms will become effective upon the consummation of the Transactions.

The Lock-Up Agreement has been entered into by RCF and TLB lenders representing

in aggregate 79.6% by amount and 65.3% by number, including:

* An informal Ad-Hoc Committee of TLB lenders and certain other TLB lenders

representing 78.9% of the ~$522 million TLB facilities

* 100% of the $215 million 2023 RCF

* 50.4% of the $135 million 2020 RCF

The Lock-Up Agreement outlines the terms of the proposed amendments to the

RCF/TLB Credit Agreement. Under the terms of the Lock-Up Agreement, the lenders

have agreed, among other things, to take such steps as are required to support

the implementation and the consummation of the Transactions. The Lock-Up

Agreement also maintains the terms of the Forbearance arrangement as put in

place with the majority of the RCF and TLB lenders prior to the previous market

announcement on September 25, 2020. The terms of the Lock-Up Agreement are

effective immediately and subject to customary undertakings and termination

events.

Following this announcement, the Company will launch a request for support from

TLB lenders who have not yet seen the details of the Transactions and from RCF

lenders who have not yet signed the Lock-Up Agreement.

Unless 100% of the RCF and TLB lenders consent to the Transactions, the

amendments to the RCF and TLB will be implemented pursuant to an English law

scheme of arrangement upon approval of the English Court, after obtaining the

necessary majority creditor consent (being 75% by value and a majority in number

of the total RCF and TLB voting in the Scheme) (the "Scheme"). The Scheme will

enable the Transaction in respect of the RCF and TLB to be implemented and bind

all RCF and TLB lenders (including those who vote against or do not vote). To

date, lenders holding a sufficient amount of RCF and TLB debt to meet the

relevant Scheme approval levels have already signed the Lock-up Agreement. The

governing law of the RCF and TLB has been changed to English law in furtherance

of the Scheme.

The agreed amendments to the RCF, TLB and ECF facilities are inter-conditional

and subject to customary conditions precedent and subsequent. They remain

subject to the implementation processes described above.

If implemented consensually (assuming 100% consent from the RCF and TLB

lenders), the Transactions are expected to close during Q4 2020. If implemented

through the Scheme, it is anticipated that the Transactions will close during

the course of Q1 2021. Further details on implementation will be announced in

due course.

Further information on the Transactions, as well as the summary financial

information shared with Ad-Hoc Committee of TLB lenders and certain other TLB

lenders, can be found in the presentation titled Cleansing Presentation on the

Company's website www.pgs.com (http://www.pgs.com) - Investors - Presentations.

The Company will continue to operate its business as usual by performing other

obligations, including making payments of interest, as they fall due.

The Company will provide updates in due course as appropriate.

FOR DETAILS, CONTACT:

BÅRD STENBERG, VP IR & CORPORATE COMMUNICATION

MOBILE:  +47 99 24 52 35

***

PGS is an integrated marine geophysical company, providing advanced subsurface

images, plus 2D and 3D data, that energy companies use to find and produce oil

and gas. PGS MultiClient data library is among the largest in the seismic

industry, with modern 3D coverage in all significant offshore hydrocarbon

provinces worldwide. The Company operates on a worldwide basis with headquarters

in Oslo, Norway and the PGS share is listed on the Oslo stock exchange (OSE:

PGS). For more information on PGS visit www.pgs.com (http://www.pgs.com/).

***

The information included herein contains certain forward-looking statements that

address activities, events or developments that the Company expects, projects,

believes or anticipates will or may occur in the future. These statements are

based on various assumptions made by the Company, which are beyond its control

and are subject to certain additional risks and uncertainties. The Company is

subject to a large number of risk factors including but not limited to the

demand for seismic services, the demand for data from our multi-client data

library, the attractiveness of our technology, unpredictable changes in

governmental regulations affecting our markets and extreme weather conditions.

For a further description of other relevant risk factors we refer to our Annual

Report for 2019. As a result of these and other risk factors, actual events and

our actual results may differ materially from those indicated in or implied by

such forward-looking statements. The reservation is also made that inaccuracies

or mistakes may occur in the information given above about current status of the

Company or its business. Any reliance on the information above is at the risk of

the reader, and PGS disclaims any and all liability in this respect.

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