SUPERIOR ENERGY SERVICES, INC. Item 1.03. Bankruptcy or Receivership.
As previously disclosed, on
Plan of Reorganization
The following is a summary of the material terms of the Plan. This summary highlights only certain substantive provisions of the Plan and is not intended to be a complete description of the Plan. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Plan. This summary is qualified in its entirety by reference to the full text of the Plan, which is attached hereto as Exhibit 2.1 and incorporated herein by reference.
Pursuant to the Plan:
• The Debtors will enter into a $120 million asset-based revolving credit
facility (the "Exit ABL Facility") on terms and conditions acceptable to
the Consenting Noteholders who executed the Restructuring Support
Agreement on September 29, 2020 and hold at least 66.6% of the aggregate
principal amount of the Prepetition Notes (the "Required Consenting
Noteholders");
• Under the Plan, certain classes of claims will receive the following
treatment:
• Administrative expense claims, priority tax claims, other priority
claims, and other secured claims will be paid in full in the ordinary
course (or receive such other treatment rendering such claims
unimpaired);
• The Company's existing equity will be discharged and terminated
without any distribution or retaining any property on account of such
equity interests;
• General unsecured creditors for the Affiliate Debtors will remain
unimpaired and are to receive payment in cash, in full, in the
ordinary course;
• Each holder of an Allowed Prepetition Notes Claim against the Company
will receive its pro rata share of a $125,000 cash pool (the "Parent
GUC Recovery Cash Pool "); provided that the holders of the Prepetition
Notes Claims against the Company shall waive any distribution from the
Parent GUC Recovery Cash Pool ;
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• Each holder of a General Unsecured Claim against the Company will
receive its pro rata share of the $125,000 Parent GUC Recovery Cash
Pool ;
• Eligible holders of the Allowed Prepetition Notes Claims Against
Affiliate Debtors will receive their pro rata share of:
• the Cash Payout; or
• solely to the extent that such a holder timely and validly elects
to be a Cash Opt-Out Noteholder, (A) 100% of the New Common Stock
Pool , subject to dilution from and after the Effective Date on
account of the New MIP Equity, and (B), to the extent such holder
is an Accredited Cash Opt-Out Noteholder, Subscription Rights;
• The Debtors intend to conduct a rights offering (the "Equity Rights
Offering") of subscription rights (the "Subscription Rights") exercisable
by the Accredited Cash Opt-Out Noteholders for purchase of the new common
stock issued by the reorganized Company (the "New Common Stock") on a pro
rata basis;
• Eligible holders of the Allowed Prepetition Notes Claims Against
Affiliate Debtors that do not elect to become a Cash Opt-Out Noteholder
shall receive a cash distribution in an aggregate amount equal to 2.00%
of the principal due under the Prepetition Notes held by such holders in
full and final satisfaction thereof (such aggregate amount, the "Cash
Payout"). The proceeds from the Equity Rights Offering will be used to
exclusively fund the Cash Payout, and the Cash Payout shall not exceed
the total amount of the proceeds of the Equity Rights Offering. Any
remaining portion of such holder's Prepetition Notes Claims that is not
satisfied by the Cash Payout will receive the treatment such holder would
otherwise be entitled to if such holder were a Cash Opt-Out Noteholder;
and
• Outstanding letters of credit under the DIP Agreement that remain undrawn
upon consummation of the Transaction shall be rolled into the Exit ABL
Facility or receive such other treatment as may be acceptable to the
Debtors, the DIP Agent, and the Required Consenting Noteholders.
• The Plan will contain customary releases, exculpations and injunctions
concerning certain parties in interest, as outlined in the Plan.
The foregoing description of the Plan does not purport to be complete and is qualified in its entirety by reference to the full text of the Plan, a copy of which is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Although the Debtors intend to pursue the transactions (collectively, the "Transaction") contemplated in the Plan and in accordance with the terms set forth therein, there can be no assurance that the Debtors will be successful in completing the Transaction, whether on the same or different terms.
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Any new securities to be issued pursuant to the Plan have not been registered
under the Securities Act or any state securities laws. Therefore, the new
securities may not be offered or sold in
Item 7.01 Regulation FD Disclosure.
On
The information contained in this Item 7.01, including in Exhibit 99.1, shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated by reference into any of the Company's filings under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and regardless of any general incorporation language in such filings, except to the extent expressly set forth by specific reference in such filings.
Forward-Looking Statements
Certain statements in this Current Report on Form 8-K contain forward-looking
statements within the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Generally, the words "contemplates," "expects,"
"anticipates," "targets," "goals," "projects," "intends," "plans," "believes,"
"seeks" and "estimates," variations of such words and similar expressions
identify forward-looking statements, although not all forward-looking statements
contain these identifying words. All statements other than statements of
historical fact included in this Current Report on Form 8-K regarding, without
limitation, the Company's business operations, financial position, financial
performance, liquidity, strategic alternatives, market outlook, future capital
needs, capital allocation plans, business strategies and other plans and
objectives of the Company's management for future operations and activities are
forward-looking statements. These statements are based on certain assumptions
and analyses made by the Company's management in light of its experience and
prevailing circumstances on the date such statements are made. Such
forward-looking statements, and the assumptions on which they are based, are
inherently speculative and are subject to a number of risks and uncertainties
that could cause actual results to differ materially from such statements, such
as uncertainties including but not limited to: the Company's ability to obtain
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continuing risks associated with the Company's ability to achieve the Company's
stated goals and continue as a going concern; the conditions in the oil and gas
industry; the effects of public health threats, pandemics and epidemics, and the
adverse impact thereof on the Company's business, financial condition, results
of operations and liquidity, including, but not limited to, the Company's
growth, operating costs, supply chain, labor availability, logistical
capabilities, customer demand and industry demand generally, margins,
utilization, cash position, taxes, the price of the Company's securities, and
the Company's ability to access capital markets, including the macroeconomic
effects from the continuing COVID-19 pandemic; the ability of the members of
OPEC+ to agree on and to maintain crude oil price and production controls; the
Company's outstanding debt obligations and the potential effect of limiting the
Company's ability to fund future growth; the Company may not be able to generate
enough cash flows to meet the Company's debt obligations; necessary capital
financing may not be available at economic rates or at all; volatility of the
Company's common stock; operating hazards, including the significant possibility
of accidents resulting in personal injury or death, or property damage for which
the Company may have limited or no insurance coverage or indemnification rights;
the Company may not be fully indemnified against losses incurred due to
catastrophic events; claims, litigation or other proceedings that require cash
payments or could impair financial condition; credit risk associated with the
Company's customer base; the effect of regulatory programs and environmental
matters on the Company's operations or prospects; the impact that unfavorable or
unusual weather conditions could have on the Company's operations; the potential
inability to retain key employees and skilled workers; political, legal,
economic and other risks and uncertainties associated with the Company's
international operations; laws, regulations or practices in foreign countries
could materially restrict the Company's operations or expose the Company to
additional risks; potential changes in tax laws, adverse positions taken by tax
authorities or tax audits impacting the Company's operating results; changes in
competitive and technological factors affecting the Company's operations; risks
associated with the uncertainty of macroeconomic and business conditions
worldwide; potential impacts of cyber-attacks on the Company's operations;
counterparty risks associated with reliance on key suppliers; challenges with
estimating the Company's potential liabilities related to the Company's oil and
natural gas property; and risks associated with potential changes of the
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 2.1 First Amended Joint Prepackaged Plan of Reorganization forSuperior Energy Services, Inc. and its Affiliate Debtors Under Chapter 11 of the Bankruptcy Code 99.1 Press Release, datedJanuary 19, 2021 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 5
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