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| IMPLEMENTATION | ■ Transaction to be implemented in-court through a pre-arranged bankruptcy filing |
■ All court filings and definitive documentation concerning the restructuring shall be in form and substance acceptable to the ad hoc group of holders (the “Ad Hoc Group”) of the $300 million 1.75% Senior Convertibles Notes due March 2017 (the “Converts”) and 7.50% Senior Notes due 2022 (the “2022 Notes”) |
TREATMENT OF REVOLVING LENDERS | ■ No borrowing base deficiency payments are made post May 2016 |
| ■ At closing / emergence, revolving lenders to receive (i) cash paydown to conform to a $300 million borrowing base; and (ii) take-back debt at the following terms: |
| • Five-year revolving credit facility with total commitments of $500 million |
| • Borrowing base subject to semi-annual redetermination based on NYMEX strip pricing beginning on June 30, 2018 with a minimum $300 million borrowing base through 2Q’18 |
| • L + 250 - 350bps (based on availability grid - implies 100bps increase to existing facility) |
• Financial covenants through the end of the maturity with adequate cushions to business plan; provided that the business plan shall be acceptable in form and substance to the Ad Hoc Group |
TREATMENT OF UNSECURED CREDITORS | ■ Conversion of both Converts and 2022 Notes claims ($1,075 million), on a pro rata basis, into the following: |
| ● $475 million of Second Lien Notes |
| • Coupon: 1% in first year, 5% in second year, 10% thereafter, payable semi-annually in cash |
| • Maturity: 5 year; callable after year 3 (105% in year 4, par thereafter) |
| ● $165 million of non-convertible PIK Preferred Stock |
| • Dividend: 12%, payable in cash or kind at the Company's election |
| • Maturity: 12 years, redeemable in cash at accreted value after year 3; redeemable at maturity in cash |
● 87.5% of the common equity; provided that such equity shall be subject to dilution including, without limitation, in connection with any management equity incentive plan and future issuances of common equity from time to time |
| ■ Subject to the Ad Hoc Group's approval of the long-term business plan, cash collateral budget and definitive documentation |
| ■ Certain other unsecured creditors may also share in pro rata allocation of Second Lien Notes, PIK Preferred Stock and common equity¹ |
| ■ Critical vendor program, convenience class, and treatment of other unsecured creditors TBD |
TREATMENT OF EXISTING SHAREHOLDERS | ■ Stockholders to receive reorganized equity in the form of 12.5% of the common equity; provided that such equity shall be subject to dilution including, without limitation, in connection with any management equity incentive plan and future issuances of common equity from time to time |
