Unit Exits Chapter 11 Bankruptcy With Debt-for-Equity Exchange

Updated 9 months 1 week ago

Unit has emerged from Chapter 11 bankruptcy protection. The company will complete a debt-for-equity exchange with the holders of 6.625% senior subordinated notes and will exchange its prior common stock for warrants to purchase its new common stock. An existing BOKF credit facility has been converted into a $140 million reserve-based lending revolving loan and $40 million term loan with BOKF.

Unit will issue 12 million shares of new common stock. 95% will be issued to subordinated note holders and certain general unsecured claims, and 5% has been issued to the lenders. Warrants to purchase up to an aggregate of approximately 1.8 million shares of common stock will be issued to holders of old common stock. The exercise price of the warrants will be determined and the warrants will become exercisable once unsecured claims are resolved. The initial exercise price per share for the warrants, which will be set at an amount that implies a recovery by holders of the subordinated notes of the $650 million principal amount of the notes plus interest on the May 15, 2021 maturity date of the Notes.

The new board consists of seven directors, including Robert Anderson, Alan Carr, Phil Frohlich, Steven Hildebrand, David Merrill, Philip Smith, and Andrei Verona. The company is seeking to facilitate trading of the new common stock on one of the OTC markets to be determined by the board. The company expects to complete this process during the 2020 fourth quarter and will publicly disclose the results once completed. Evercore served as investment banker.