Goodrich Petroleum reorganization plan confirmed by bankruptcy court

By Caroline Salls

Pittsburgh, Sept. 29 – Goodrich Petroleum Corp.’s plan of reorganization was confirmed Wednesday by the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, through its restructuring, Goodrich said it would slash about $400 million of debt from its balance sheet and substantially deleverage its capital structure.

The restructuring agreement removes all of the company’s pre-bankruptcy funded debt other than its first-lien reserve-based loan facility.

The key components of the plan include the following:

• Payment in full, in cash, of administrative claims, professional fee claims, priority tax claims, statutory fees and other priority claims;

• Senior credit facility claims will be treated in accordance with an agreement between Goodrich, the senior credit facility claimants and the majority second-lien noteholders. Specifically, these creditors will receive cash in an amount sufficient to reduce the claims to a balance of $20 million with the remaining $20 million to be refinanced into a new first-lien credit facility;

• About $175 million of debt under the second-lien notes will be converted for 100% of the new Goodrich equity interests, subject to dilution from shares issued in connection with a management incentive plan;

• Holders of unsecured notes claims will receive with holders of general unsecured claims a share of out-of-the-money warrants equal to up to 10% of the new Goodrich equity interests with a maturity of 10 years and an equity strike price equal to $230 million, plus 2% of the new equity interests; and

• Equity interests in Goodrich will be cancelled and discharged, and holders will receive no distribution.

Goodrich, a Houston-based oil and gas exploration and production company, filed bankruptcy on April 15. The Chapter 11 case number is 16-31975.

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