Bankruptcy News

We've summarized the latest docket activity and news for publicly traded companies currently operating under U.S. Bankruptcy Court protection.

Bankruptcy/Chapter 11 / Bonds

Vanguard Natural Resources Chapter 11 Petition Filed

Vanguard Natural Resources and 13 affiliated Debtors filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Southern District of Texas, lead case number 17-30560. The Company, which acquires and develops oil and natural gas properties, is represented by James T. Grogan of Paul Hastings. In connection with the bankruptcy, Vanguard Natural Resources has entered into a restructuring support agreement (RSA) with certain consenting holders of the Company's 7.875% Senior Notes due 2020, 8 3/8% Senior Notes due 2019 and 7.0% Senior Secured Second Lien Notes due 2023. Under the RSA, the restructuring support parties agreed to support a plan of reorganization for the Company that would include (i) a fully committed $19.25 million equity investment by the consenting holders of the second lien notes and (ii) a $255.75 million rights offering that is fully backstopped by the consenting holders of the Senior Notes due 2020 and Senior Notes due 2019. Through implementation of the transactions set forth in the RSA, the Company would eliminate approximately $708 million in debt under the Company's reserve-based credit facility and senior unsecured debt. Vanguard Natural Resources has obtained a committed $50 million debtor-in-possession financing facility underwritten by Citibank, JPMorgan Securities and Wells Fargo Bank. Subject to Court approval, this financing, combined with the Company's cash from operations, is expected to provide sufficient liquidity during the Chapter 11 cases to support its continuing business operations and minimize disruption. Scott W. Smith, president and C.E.O., comments, "The depressed commodity price cycle which has persisted over the past two years, combined with a tightened regulatory environment for senior debt providers, has resulted in a situation where, despite reducing our total debt by over $500 million in 2016, we find ourselves unable to meet the obligations of our current credit facility. With a successful restructuring of our balance sheet, Vanguard will be better positioned to weather this new lower for longer commodity price environment, while also improving our long-term financial security and better position us for long-term success."

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