Chaparral Energy said March 21 it successfully completed its reorganization agreement and emerged from bankruptcy with more than $100 million in liquidity.
In May 2016, Chaparral filed voluntary petitions for Chapter 11 bankruptcy in the U.S. Bankruptcy Court of Delaware. As part of the reorganization, the company converted $1.2 billion of pre-petition debt to equity and eliminated about $100 million of annual interest expense.
Chaparral’s new capital structure includes its cash on hand, a reserve-based lending facility with an initial borrowing base of $225 million and an additional $150 million term loan. Both the revolver and loan will mature in four years. The company also received an additional $50 million in cash from an equity offering.
RELATED: Chaparral Aims For Pipeline Sale In Push To Exit Bankruptcy
The Oklahoma City-based company's emergence from bankruptcy "marks a new and prosperous time in Chaparral's storied history," said K. Earl Reynolds, Chaparral CEO.
“Our balance sheet now provides the stability and opportunity needed to focus our operations on developing our approximate 100,000 net acre position in the Stack Play," Reynolds said in a statement. "With more than 5,000 potential Stack locations and one of the industry’s lowest operating cost structures, we are well-positioned to generate significant returns for Chaparral and our investors in the near- and long-term future."
In November, Reynolds succeeded Mark A. Fischer as CEO and board chairman at Chaparral following Fischer's retirement. Fischer, who founded the company in 1988, served as its CEO and chairman since its inception.
In addition, the company’s new board of directors became effective March 21 and includes Reynolds, Douglas Brooks, Matt Cabell, Robert Heinemann, Sam Langford, Ken Moore and Gysle Shellum.
Chaparral was advised through the reorganization process by financial adviser Evercore, restructuring adviser Opportune LLP and the law firm of Latham & Watkins LLP.
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