Lonestar Resources US Inc. announces restructuring support agreement

FORT WORTH, Texas – () – Lonestar Resources US Inc. (the “Company” or “Lonestar”) (NASDAQ: LONE) today announced that it and certain of its domestic direct and indirect wholly-owned subsidiaries (collectively with the Company , the “Debtors”) have entered into a Restructuring Support Agreement (the “Support Agreement”) with its key stakeholders that will eliminate approximately $ 390 million in debt and preferred interests.

Pursuant to the Support Agreement, approximately $ 250 million of the Company’s 11.250% Senior Notes due 2023 (the “Notes”) will be converted into equity and accrued interest thereon will be extinguished. In addition, lenders under the Company’s revolving credit facility who agree to accept the Plan (as defined below) will receive, among other things, their pro rata share of the warrants (the “New Warrants”). subscription ”) to buy up to 10% of the new share subscription warrants in the Company (subject to dilution only by the issue of new shareholdings as part of a management incentive plan (“ MIP Equity ” ), revolving loans under the Revolving Exit Credit Facility and term loans under the Secondary Exit Term Facility. Holders of preferred interests in the Company will receive their pro rata share of 3% of the new interests in the Company. Company (subject to dilution by MIP Equity and New Warrants) and holders of existing Class A ordinary shares of the Company will receive their quota of 1% of the new parties. cipations in the Company (subject to dilution by MIP Equity and New Warrants).

Under the Support Agreement, the Debtors would effect the Proposed Transactions through a pre-arranged reorganization plan (the “Plan”) under Chapter 11 of the US Bankruptcy Code (“Chapter 11”). The Company has already secured support for proposed transactions from lenders holding 100 percent of the total principal amount outstanding under its revolving credit facility, with noteholders holding approximately 67.1 percent of the total principal amount outstanding under its revolving credit facility. by virtue of its notes and equity interests.

The Company is confident, based on the Support Agreement, that it will be able to meet its financial commitments and continue to operate as usual throughout the restructuring period. The Company expects to fund the Cases and continue to operate the business with cash on hand and certain proceeds from the consensual termination of the Debtors’ existing hedging agreements with certain lenders under its revolving credit facility. The support agreement provides that the company will continue to operate its business without disrupting its customers, suppliers, partners or employees. In addition, the Support Agreement provides that unsecured commercial creditors will be paid in full under the plan.

“We have carefully considered our options in the unprecedented environment facing the energy industry and have concluded that a consensual restructuring is in the best interests of the Company. In combination with our efforts to significantly reduce our investment and operating costs, the significant reduction in leverage that this transaction will provide to the Company will position Lonestar to be very competitive going forward, ”said Frank D. Bracken III, CEO of the Company. .

The Company is represented in this matter by Latham & Watkins LLP, Hunton Andrews Kurth LLP, Intrepid Partners LLC, Rothschild & Co US Inc. and AlixPartners, LLP.

About Lonestar

Lonestar is an independent energy company focused on the development, production and acquisition of unconventional oil, natural gas liquids and natural gas properties in the Eagle Ford Shale in Texas.

Forward-looking statements

This communication includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are, or may be considered, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties and projections of operating results or financial condition or forecasts of future events that could lead to actual results, performance or events. differ materially from those expressed or implied in such statements. Words such as “could”, “will”, “may”, “assume”, “predict”, “position”, “predict”, “strategy”, “expect”, “intend”, “plan” , “Estimate,” “” anticipate “,” believe “,” project “,” budget “,” potential “,” forward “or” continue “and similar expressions are used to identify forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this communication include statements regarding management’s expectations regarding plans, strategies, objectives, growth and expected financial and operational performance, financial outlook; sources and intended uses of capital; the transactions contemplated by the Support Agreement, including the restructuring of the Company, including the expected benefits of such transactions, business strategies, intended sources and uses of capital, future financial prospects and other matters which are not not historical facts. These forward-looking statements involve numerous risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, the inability to complete the Plan or restructuring; risks associated with disruption of management attention related to ongoing business transactions due to Chapter 11 files to be filed by debtors or due to restructuring; and the effects of future litigation, including litigation relating to Chapter 11 matters or restructuring. Forward-looking statements may be affected by assumptions used or by known or unknown risks or uncertainties. Therefore, no forward-looking statement can be guaranteed. These forward-looking statements speak only as of the date of this communication, and the Company expressly disclaims any obligation or commitment to release any update or revision to any forward-looking statement contained herein to reflect any change in the Company’s expectations. in this regard or any change in the events, conditions or circumstances on which such statement is based. Please refer to the Company’s public documents, including the most recent Forms 10-K and 10-Q for additional information about the Company and the risks and uncertainties associated with the Company’s business which may affect the statements made in this communication.

No solicitation or offer

Any new securities to be issued in connection with the restructuring transactions may not be registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities law, but may be issued under an exemption from such registration under the United States Bankruptcy Code. These new securities may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any state securities laws. This press release does not constitute an offer to sell or buy, or the solicitation of an offer to sell or buy, any securities referred to herein, and this press release is not nor a solicitation of consents or votes to accept a Chapter 11 plan. Any solicitation or offer will be made only under a confidential offering memorandum and a disclosure statement and only to persons and within jurisdictions authorized by applicable law.

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