Bonanza Creek starts exchange offer, consent bid for two HighPoint notes series

By Rebecca Melvin

New York, Feb. 10 – Bonanza Creek Energy Inc. is offering to exchange shares of its common stock and newly issued 7½% senior notes due 2026 for any and all of HighPoint Resources Corp.’s 7% senior notes due 2022 and 8¾% senior notes due 2025, according to a joint news release.

HighPoint is soliciting, on behalf of its operating company subsidiary, consents to proposed amendments to the indentures governing the HighPoint notes.

The exchange offers and consent solicitations are being commenced in connection with Bonanza Creek’s proposed acquisition of Highpoint, and HighPoint is soliciting votes from holders of its senior notes to accept or reject a prepackaged plan of reorganization under Chapter 11 of the United States Bankruptcy Code.

The exchange offers are conditional on at least 97.5% of the outstanding principal amount of each series of notes being validly tendered. If the minimum participation condition is not met, HighPoint intends to file voluntary petitions under Chapter 11 to pursue the prepackaged bankruptcy plan.

For notes validly tendered prior to 5 p.m. ET on March 11, holders of HighPoint senior notes will be eligible to receive 14.90274240 shares of Bonanza Creek common stock and $138.46153846 principal amount of new Bonanza Creek senior notes.

If less than 100% of the notes are validly tendered and accepted, holders will receive additional Bonanza Creek common shares upon proration of the aggregate 9,314,212 shares. If greater than 97.5% are validly tendered and accepted, holders will receive a higher principal amount of Bonanza Creek senior notes upon proration of the aggregate principal amount of notes equal to $100 million minus the total principal amount of notes not tendered.

If 97.5% of the aggregate principal amount outstanding of HighPoint notes are exchanged, $84,375,000 aggregate principal amount of Bonanza Creek senior notes will be issued and $15,625,000 aggregate principal amount of HighPoint senior notes will remain outstanding. If 100% of the aggregate principal amount outstanding of HighPoint notes are exchanged, $100 million of the new Bonanza Creek notes will be issued.

The exchange consideration will consist of 9,314,214 shares of Bonanza Creek common stock and an aggregate principal amount of Bonanza Creek senior notes equal to $100 million minus the total principal amount of HighPoint senior notes not validly tendered and accepted in the exchange offers.

Epiq Corporate Restructuring LLC (855 914-4726, tabulation@epiqglobal.com) is the exchange agent and information agent for the offers, consent solicitations and voting agent for the plan solicitation.

Bonanza Creek is an independent oil and gas company, and High Point is a company focused on the development of oil and gas assets located in the Denver-Julesburg Basin of Colorado. Both are based in Denver, Colo.

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