Goodrich Petroleum announced yesterday:
Goodrich Petroleum Corporation today announced that it has commenced offers to exchange newly issued shares of common stock, par value $0.20 per share, for any and all of its Existing Unsecured Notes and for any and all shares of its Existing Preferred Stock. The Company has also announced it intends to offer to exchange its Second Lien Notes into new second lien notes with materially identical terms except that interest thereon may be paid either (a) at the Company's option in cash or in-kind or (b) deferred until maturity. The Second Lien Notes Exchange Offers, together with the Unsecured Notes Exchange Offers and the Preferred Exchange Offers collectively referred to as the "Exchange Offers" and the "Recapitalization Plan". [...]It looks like this would give 184 million shares to unsecured noteholders. The company currently has 61 million shares outstanding.
If successful with the above referenced Existing Unsecured Notes Exchange and Second Lien Notes Exchange, the Company would eliminate between $213 million and $224.2 million in unsecured senior indebtedness with respect to the exchange and cancellation of Existing Unsecured Notes in the Exchange Offers, and $29.8 million to $31.4 million in cash interest payment obligations per year, thereby preserving liquidity in the near term. [...]
The Company is conducting the Exchange Offers in response to the current low commodity price environment that has had a significant, adverse impact on the Company. While the Company is not currently in default under its existing debt instruments, its ability to make the March 2016 interest payments on its 8.00% Second Lien Senior Secured Notes due 2018 and 8.875% Senior Notes due 2019 and service its other debt and fund its operations is at significant risk as a result of the sustained continuation of the current commodity price environment. If the Company is unable to complete the Recapitalization Plan, including the Exchange Offers, and address its near-term liquidity needs, it may need to seek relief under the U.S. Bankruptcy Code. This relief may include: (i) seeking bankruptcy court approval for the sale or sales of some, most or substantially all of the Company's assets pursuant to section 363(b) of the U.S. Bankruptcy Code and a subsequent liquidation of the remaining assets in the bankruptcy case; (ii) pursuing a plan of reorganization (where votes for the plan may be solicited from certain classes of creditors prior to a bankruptcy filing) that the Company would seek to confirm (or "cram down") despite any classes of creditors who reject or are deemed to have rejected such plan; or (iii) seeking another form of bankruptcy relief, all of which involve uncertainties, potential delays and litigation risks.