Gulfport Receives Court Approval of First-Day Motions to Support Ongoing Operations
November 17 2020 - 11:11AM
Gulfport Energy Corporation (NASDAQ: GPOR) (“Gulfport”) today
announced that the United States Bankruptcy Court for the Southern
District of Texas (the “Court”) granted approval of all
Gulfport’s “first day” motions, authorizing, among other
things, Gulfport to continue paying royalties, employee wages
and benefits, and certain vendors and suppliers in the ordinary
course of business for goods and services provided, and to enter
into new hedging arrangements in accordance with an agreement with
certain prepetition lenders.
The Court also authorized Gulfport to borrow up
to $90 million in debtor-in-possession (“DIP”) financing. The DIP,
combined with cash generated by Gulfport, will support ongoing
operations in the ordinary course of business during the
restructuring.
Gulfport intends to use the bankruptcy
proceedings to strengthen its balance sheet, restructure certain
debt obligations, significantly reduce its midstream cost
structure, and achieve a more sustainable capital structure.
Gulfport intends to continue to operate in the ordinary course of
business during the restructuring process.
As previously announced, on November 14, 2020,
Gulfport and all of its wholly-owned subsidiaries filed petitions
for voluntary relief under chapter 11 of the United States
Bankruptcy Code. In connection with the filing, Gulfport also
entered into a Restructuring Support Agreement (“RSA”) with over
95% of its revolving credit facility lenders and certain
noteholders holding over two-thirds of the outstanding aggregate
principal amount of its senior unsecured notes. Attached to the RSA
is a “pre-negotiated” restructuring plan, pursuant to which
Gulfport will eliminate approximately $1.25 billion in funded debt
and significantly reduce its annual cash interest going forward.
Gulfport will also issue $550 million of new senior unsecured notes
under the plan to existing unsecured creditors of certain Gulfport
subsidiaries. Certain senior secured noteholders have committed to
backstop a minimum new money investment of $50 million in the form
of convertible preferred stock.
Gulfport expects to exit the chapter 11 process
with leverage below two times and rapidly delever thereafter due to
a much-improved cost structure driven by reduced legacy firm
transport commitments and costs. Gulfport has also received a
commitment from its existing lenders to provide $580 million in
exit financing upon emergence from chapter 11.
Additional information regarding Gulfport’s
chapter 11 filing will be available at
www.gulfportenergy.com/restructuring. Court filings and information
about the claims process are available at
https://dm.epiq11.com/Gulfport. Questions should be directed to
Gulfport’s claims agent by email to GulfportInfo@epiqglobal.com or
by phone at (888) 905-0409 (toll free) or +1 (503) 597-7687
(international).
Kirkland & Ellis LLP and Jackson Walker
L.L.P. are serving as legal co-counsel, Perella Weinberg Partners
and its affiliate, Tudor Pickering Holt & Co. are serving as
financial advisors, and Alvarez & Marsal is serving as
restructuring advisor to Gulfport.
About
GulfportGulfport is an independent
returns-oriented, gas-weighted, exploration and development company
and is one of the largest producers of natural gas in the
contiguous United States. Headquartered in Oklahoma City, Gulfport
holds significant acreage positions in the Utica Shale of Eastern
Ohio and the SCOOP Woodford and SCOOP Springer plays in Oklahoma.
Gulfport has 259 employees.
Forward-Looking StatementsThis
press release includes “forward-looking statements” for purposes of
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are statements other than statements of
historical fact. They include statements regarding: (i) the effect
of the chapter 11 reorganization and sufficiency of the financing
package; (ii) Gulfport’s ability to continue implementing operating
efficiencies and technical developments; and (iii) Gulfport’s
ability to capitalize on the reorganization and emerge as a
stronger and more competitive enterprise. Although Gulfport
believes the expectations and forecasts reflected in the
forward-looking statements are reasonable, Gulfport can give no
assurance they will prove to have been correct. They can be
affected by inaccurate or changed assumptions or by known or
unknown risks and uncertainties. Important risks, assumptions and
other important factors that could cause future results to differ
materially from those expressed in the forward-looking statements
are described under "Risk Factors" in Item 1A of Gulfport’s annual
report on Form 10-K for the year ended December 31, 2019 and any
updates to those factors set forth in Gulfport's subsequent
quarterly reports on Form 10-Q or current reports on Form 8-K
(available at http://www.ir.gulfportenergy.com/all-sec-filings).
Gulfport undertakes no obligation to release publicly any revisions
to any forward-looking statements, to report events or to report
the occurrence of unanticipated events.
Investor ContactJessica Antle –
Director, Investor
Relationsjantle@gulfportenergy.com405-252-4550
Media ContactReevemarkHugh
Burns / Paul Caminiti / Nicholas Leasure212-433-4600
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