On April 19, 2016, Seventy Seven Energy Inc. announced that it has entered into a Restructuring Support Agreement with certain lenders representing 92% of the outstanding principal amount under the Company’s Incremental Term Supplement (Tranche A) loan and certain noteholders collectively owning or controlling in excess of 57.7% of the aggregate outstanding principal amount of the Company’s 6.625% senior notes due 2019. The Agreement outlines an expected restructuring through a prepackaged plan of reorganization.
On April 19, 2016, Standard & Poor’s Ratings Services lowered its corporate credit rating on Seventy Seven Energy Inc. to CC from CCC-, its secured term loan to CCC from CCC+ and its unsecured notes to CC from CCC-. “The downgrade follows SSE’s announcement that it has entered into a restructuring support agreement with certain lenders of its incremental term supplement loan, currently representing 92% of the aggregate outstanding principal amount…,” said Standard & Poor’s credit analyst Kevin Kwok. Read more on distressed companies.