The U.S. Bankruptcy Court approved Chaparral Energy’s motion for an order authorizing the Debtors to (i) conduct a rights offering, (ii) enter into a backstop commitment agreement and (iii) pay fees and expenses associated therewith and approving subscription form.
As previously reported, “The overall purpose of the Plan will be to provide for a restructuring of the Debtor’s balance sheet liabilities in a manner designed to maximize recoveries and to enhance the financial viability of the Debtors as reorganized (the ‘Reorganized Debtors’).”
In addition, “In general, the Plan Term Sheet contemplates the following restructuring: All allowed Administrative Expense Claims, Priority Tax Claims, Other Priority Claims, Other Secured Claims, and Secured Tax Claims will be paid in full or otherwise unimpaired; Each holder of Prepetition Credit Agreement Claims shall receive (a) its pro rata share of $375 million in loans outstanding to be restructured into a four-year credit facility, consisting of (i) a $225 million first-out revolving loan and (ii) a $150 million second-out term loan (collectively, the ‘Exit Facility Loans’) and (b) to the extent the Prepetition Credit Agreement Claims of such holders exceed the Exit Facility Loans, cash sufficient to satisfy the remainder.”
The motion continues, “Each holder of an Unsecured Notes Claim shall receive its pro rata share of (a) 100% of the ownership interests in Reorganized Chaparral Parent, subject to dilution by the Management Incentive Plan….The Debtors will conduct a $50 million Rights Offering for the Rights Offering Shares.…Although the Debtors will offer Subscription Rights to all Eligible Holders, it is possible that the Debtors will be unable to obtain sufficient commitments from the Eligible Holders to purchase $50 million of Rights Offering Shares.”
Read more energy bankruptcy news.
The post Chaparral Energy Rights Offering Approved appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.