Extraction Oil & Gas Completes Financial Restructuring
Company Achieves
Extraction to embrace new E&P business and governance model
Extraction also announced the appointments of
Extraction’s new Board has also established the Company’s first Environmental, Social and Governance committee made up of directors. The committee will oversee the Company’s programs, policies and practices relating to environmental, health and safety, sustainability, corporate social responsibility and other public policy matters.
“The Extraction team has worked hard over the last six months to right-size the business, lower its cost structure and optimize its midstream agreements,” said
New Capital Structure
Extraction’s capital structure now includes a new
Unrestricted Cash
- Approximately
$11 million cash balance at emergence
New RBL Facility
$500 million initial borrowing base- Approximately
$265 million drawn at emergence - Matures
July 2024
Rights Offering
$200 million in proceeds raised from a rights offering subscribed by the Company’s unsecured note holders, existing equity holders and general unsecured creditors- Proceeds used to repay Debtor-in-Possession (DIP) facility
New Common Equity
- Approximately 25 million shares of common stock outstanding
- Approximately 0.7 million incremental shares reserved for potential future distribution to certain general unsecured claimants whose claim values are pending
Pro Forma Capital Structure Details
Pro forma for the repaid DIP facility and drawings under the new RBL facility, the restructuring resulted in a net reduction of approximately
As of | Restructuring | Pro Forma at | ||||||||
Shares Outstanding (in thousands) | Adjustments | Emergence | ||||||||
Series A Preferred Stock | 185 | (185 | ) | — | ||||||
Stockholders’ Equity: | ||||||||||
Common Stock | 138,372 | (138,372 | ) | — | ||||||
Treasury Stock | 38,859 | (38,859 | ) | — | ||||||
New Common Stock | — | 24,927 | 24,927 | |||||||
Shares Outstanding (1)(2)(3) | 177,231 | (152,304 | ) | 24,927 |
(1) Excludes 0.7 million shares reserved for potential distribution to general unsecured claimants
(2) Excludes approximately 2.9 million Tranche A Warrants, exercisable for one share of New Common Stock per Tranche A Warrant at an initial exercise price of
(3) Excludes approximately 1.5 million Tranche B Warrants, exercisable for one share of New Common Stock per Tranche B Warrant at an initial exercise price of
As of |
Restructuring |
Pro Forma at |
|||||||||||
Debt and Preferred Stock (in thousands) | Adjustments |
Emergence |
|||||||||||
RBL Facilities: | |||||||||||||
DIP | 110,000 | (110,000 | ) | — | |||||||||
Pre-Petition RBL | 453,746 | (453,746 | ) | — | |||||||||
New RBL | — | 265,000 | 265,000 | ||||||||||
Sub-total RBL Facilities | $ | 563,746 | $ | (298,746 | ) | $ | 265,000 | ||||||
Senior Unsecured Notes: | |||||||||||||
2024 Senior Notes due |
400,000 | (400,000 | ) | — | |||||||||
2026 Senior Notes due |
700,189 | (700,189 | ) | — | |||||||||
Sub-total Senior Unsecured Notes | 1,100,189 | (1,100,189 | ) | — | |||||||||
Total Debt (1) | $ | 1,663,935 | $ | (1,398,935 | ) | $ | 265,000 | ||||||
Series A Preferred Stock | $ | 189,840 | $ | (189,840 | ) | $ | — | ||||||
Liquidity (in thousands) | |||||||||||||
RBL Borrowing Base | $ | 650,000 | $ | (150,000 | ) | $ | 500,000 | (2) | |||||
(-) RBL Drawn | (600,500 | ) | 335,500 | (265,000 | ) | ||||||||
(-) Letters of Credit Outstanding | (49,500 | ) | 40,300 | (9,200 | ) | ||||||||
(+) Cash | 121,165 | (110,255 | ) | 10,910 | (3) | ||||||||
Total Liquidity | $ | 121,165 | $ | 115,545 | $ | 236,710 |
(1) Total Debt amount excludes leases accounted for pursuant to ASC 842 and outstanding letters of credit
(2) New RBL borrowing base of
(3) Expected cash balance upon emergence and may not reflect changes in net working capital on the Effective Date
Listing on NASDAQ
In connection with emergence from Chapter 11, the Company’s existing equity interests will be converted into shares in the newly capitalized company, effective
Details of the restructuring, securities issued pursuant to the Plan and the debt and other agreements entered into as part of the Plan will be provided in a Form 8-K which can be viewed on the Company’s website or the Securities and Exchange Commission’s website at www.sec.gov.
Court filings and other information related to the restructuring will continue to be available on the Company’s website at www.extractionog.com/restructuring-information and at http://www.kccllc.net/extractionog, which is a website administered by the Company’s noticing agent,
About
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in this press release constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included herein concerning, among other things, planned capital expenditures, increases in oil and gas production, the number of anticipated wells to be drilled or completed after the date hereof, future cash flows and borrowings, pursuit of potential acquisition opportunities, our financial position, business strategy and other plans and objectives for future operations, are forward-looking statements. These forward-looking statements are identified by their use of terms and phrases such as “may,” “expect,” “estimate,” “project,” “plan,” “believe,” “intend,” “achievable,” “anticipate,” “will,” “continue,” “potential,” “should,” “could,” and similar terms and phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they do involve certain assumptions, risks and uncertainties. These forward-looking statements represent our expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our control that could cause actual results to differ materially from the results discussed in the forward-looking statements.
Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, we do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for us to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in the “Risk Factors” section of our most recent Form 10-K and Forms 10-Q filed with the
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Source: Extraction Oil & Gas, Inc.