Bonanza Creek Energy Prepackaged Chapter 11 Plan of Reorganization Confirmed by Court
April 07 2017 - 12:03PM
Bonanza Creek Energy, Inc. (NYSE:BCEI) (“Bonanza Creek” or the
“Company”) today announced that, just over three months after it
filed for Chapter 11 relief, the United States Bankruptcy Court for
the District of Delaware (the “Court”) has confirmed its Third
Amended Plan of Reorganization (the “Prepackaged Plan”). In
addition, the Court approved the commencement of a rights offering
that will result in the infusion of approximately $200 million of
new liquidity into the Company upon its emergence from
bankruptcy. Bonanza Creek expects to emerge from bankruptcy
before the end of this month.
“The Court’s confirmation of our Prepackaged Plan represents a
significant step toward completing our successful financial
restructuring,” said Richard Carty, Bonanza Creek’s President and
Chief Executive Officer. “We will emerge as a strong and
deleveraged company with a competitive business plan that will
position us well vis a vis our industry peers. Bonanza Creek is
thankful for the steadfast support of our dedicated employees,
creditors, vendors and other parties throughout the restructuring
process.”
The Prepackaged Plan, which received unanimous support from
Bonanza’s creditors, incorporates the terms of the previously
announced Restructuring Supporting Agreement the Company entered
into with certain noteholders and one of its crude oil purchase and
sale counterparties, NGL Crude Logistics, LLC and its parent, NGL
Energy Partners LP. The Prepackaged Plan equitizes
over $867 million of unsecured debt, eliminates
over $50 million in annual cash interest, and completes a
new capital raise of $200 million through the rights
offering.
In addition, the Prepackaged Plan implements (i) agreements
the Company reached with its existing secured lenders to continue
their support of the Company through an amended and restated
revolving reserved based lending agreement, (ii) a settlement
with the Company’s equity holders to provide them with their pro
rata share of up to 4.5% of the equity of reorganized Bonanza
Creek, subject to dilution as set forth in the Prepackaged Plan,
and 3 year warrants for up to 7.5% of such equity of reorganized
Bonanza Creek and (iii) a settlement with members of an ad hoc
group of equity holders. All customer, vendor, and employee
obligations associated with the ongoing business will remain
unaffected.
Advisors
Davis, Polk & Wardwell LLP is acting as legal counsel,
Perella Weinberg Partners LP is acting as financial advisor, and
Alvarez & Marsal LLC is acting as restructuring advisor to the
Company in connection with its restructuring efforts.
About Bonanza Creek Energy
Bonanza Creek Energy, Inc. is an independent oil and natural gas
company engaged in the acquisition, exploration, development and
production of onshore oil and associated liquids-rich natural gas
in the United States. The Company’s assets and operations are
concentrated primarily in the Rocky Mountain region in the
Wattenberg Field, focused on the Niobrara and Codell formations,
and in southern Arkansas, focused on oily Cotton Valley sands. The
Company’s common shares are listed for trading on the NYSE under
the symbol: “BCEI.” For more information about the Company, please
visit www.bonanzacrk.com. Further information on the restructuring
process and the Prepackaged Plan can be found on the Company’s case
information website, located at
http://cases.primeclerk.com/bcei. Please note that the
Company routinely posts important information about the Company
under the Investor Relations section of its website.
Safe Harbor Statement
This release includes forward-looking statements
and projections, made in reliance on the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995, including
statements regarding our liquidity. Bonanza Creek has made
every reasonable effort to ensure that the information and
assumptions on which these statements and projections are based are
current, reasonable, and complete. However, a variety of
factors could cause actual results to differ materially from the
projections, anticipated results or other expectations expressed in
this release, including: (i) changes in demand for our services and
any related material impact on our pricing and utilizations rates,
(ii) Bonanza Creek’s ability to execute, manage and integrate
acquisitions successfully, (iii) changes in our expenses, including
labor or fuel costs and financing costs, (iv) continued volatility
of oil or natural gas prices, and any related changes in
expenditures by our customers, (v) competition within our industry,
(vi) Bonanza Creek’s ability to comply with its financial and
other covenants and metrics in its debt agreements, as well as any
cross-default provisions, and (vii) the ability to execute Bonanza
Creek’s business and restructuring plan. Additional important risk
factors that could cause actual results to differ materially from
expectations are disclosed in Item 1A of Bonanza Creek’s Form 10-K
for the year ended December 31, 2016. While Bonanza Creek
makes these statements and projections in good faith, neither
Bonanza Creek nor its management can guarantee that anticipated
future results will be achieved. Bonanza Creek assumes no
obligation to publicly update or revise any forward-looking
statements made herein or any other forward-looking statements made
by Bonanza Creek, whether as a result of new information, future
events, or otherwise.
Contacts:
James R. Edwards
Director, Investor Relations
(720) 440-6136
Prime Clerk
Information Call Center
(855) 252-4427
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