Halcón Resources Corporation (Halcón) has been involved in discussions with certain of its stakeholders in respect of a possible restructuring of the indebtedness and capitalization of Halcón and its subsidiaries.

On August 2, 2019 the Company entered into a restructuring support agreement with holders of approximately 67.3% of the aggregate outstanding principal amount of the 6.75% Senior Notes due 2025 issued by Halcón under that certain indenture, dated as of February 16, 2017, pursuant to which the parties have agreed to support a restructuring on the terms of a prepackaged plan of reorganization.

The RSA contemplates that the Company will file for voluntary relief under title 11 of chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas on or before August 7, 2019 if certain approval levels are attained from the Senior Noteholders in favor of the restructuring in accordance with the terms of the RSA. 

In connection with the RSA and the Chapter 11 Case, the Company has received an underwritten commitment from BMO Harris Bank, N.A. for the entire amount of a new $750 million senior secured revolving credit facility (the “Exit Facility”), effective upon the Company’s emergence from the Chapter 11 Case, which will be arranged by BMO Capital Markets Corp. The Exit Facility will have an expected initial borrowing base of $275 million.  A portion of the Exit Facility in the amount of $50 million will be available for the issuance of letters of credit. The proceeds of the Exit Facility will be used to refinance indebtedness that the Company incurs during the pendency of the Chapter 11 Case under a debtor-in-possession credit facility, for working capital and other general corporate purposes, to issue letters of credit, for transaction fees and expenses and for fees related to the Company’s emergence from the Chapter 11 Case. The Exit Facility is subject to customary closing conditions and approval by the Bankruptcy Court, which has not been obtained at this time.
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