Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Halcon Resources Files for Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman
Date: July 19, 2016
Key Contacts
Back
Halcon Resources Files Chapter 11
Recently, Halcon Resources, one of the largest energy exploration and production companies in the U.S., announced that it will file for Chapter 11 bankruptcy protection. According to Oil and Gas 360, the company has negotiated a prepackaged agreement with its primary noteholders to eliminate $1.8 billion from its debt total.
Halcon Resources’ mounting debt load lands it in insolvency
In 2015, Halcon had a series of debt-for-equity swaps that converted $258 million in unsecured notes into 144.8 million shares of common stock for noteholders such as Union Square Park Partners, Pioneer Investments, JPMorgan Securities, Goldman Sachs Asset Management and Franklin Templeton Investment.
In its recent financial report, dated May 9, Halcon listed only $8.6 million in cash on its balance sheet after it recorded a $539.99 million net loss for the first quarter of this year. Its stock on the New York Stock Exchange closed recently at 26.1 cents, which represented a 72 percent drop from 97 cents in less than one week.
Halcon Resources’ reorganization plan
In its bankruptcy documents, the company stated that it will restructure its balance sheet as part of a deal reached with senior noteholders. The plan calls for Halcon Resources’ annual interest debt load to be reduced by over $200 million. The debtholders will own majority shares in the newly restructured organization, while preferred shareholders will receive $11.1 million in cash and common shareholders will receive 4 percent of pro forma equity.
The Street reported that the terms of the deal will provide certain shareholders $1.02 billion in 13 percent third-lien notes by 2022, $297.2 million in 8.875 percent senior unsecured notes in 2022, $37.2 million in 9.25 percent senior unsecured notes in 2022, $315.5 million in 9.75 percent senior unsecured notes in 2020, $267.75 million in 8 percent convertible senior unsecured notes in 2020 and 5.75 percent perpetual convertible preferred stock.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
For more articles dealing with energy companies filing for Bankruptcy, check out:
- Chaparral Energy Inc. files for Chapter 11 Bankruptcy Protection
- Energy & Retail Lead the Way as Business Bankruptcies Increase
- SunEdison Prepping to File for Chapter 11 Bankruptcy
- Practices: Bankruptcy & Creditors' Rights
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Does Your Homeowners Insurance Provide Adequate Coverage?
Your home is likely your greatest asset, which is why it is so important to adequately protect it. Homeowners insurance protects you from the financial costs of unforeseen losses, such as theft, fire, and natural disasters, by helping you rebuild and replace possessions that were lost While the definition of “adequate” coverage depends upon a […]
Author: Jesse M. Dimitro
Understanding the Importance of a Non-Contingent Offer
Making a non-contingent offer can dramatically increase your chances of securing a real estate transaction, particularly in competitive markets like New York City. However, buyers should understand that waiving contingencies, including those related to financing, or appraisals, also comes with significant risks. Determining your best strategy requires careful analysis of the property, the market, and […]
Author: Jesse M. Dimitro
Fred D. Zemel Appointed Chair of Strategic Planning at Scarinci & Hollenbeck, LLC
Business Transactional Attorney Zemel to Spearhead Strategic Initiatives for Continued Growth and Innovation Little Falls, NJ – February 21, 2025 – Scarinci & Hollenbeck, LLC is pleased to announce that Partner Fred D. Zemel has been named Chair of the firm’s Strategic Planning Committee. In this role, Mr. Zemel will lead the committee in identifying, […]
Author: Scarinci Hollenbeck, LLC
Novation Agreement Process: Step-by-Step Guide for Businesses
Big changes sometimes occur during the life cycle of a contract. Cancelling a contract outright can be bad for your reputation and your bottom line. Businesses need to know how to best address a change in circumstances, while also protecting their legal rights. One option is to transfer the “benefits and the burdens” of a […]
Author: Dan Brecher
What Is a Trade Secret? Key Elements and Legal Protections Explained
What is a trade secret and why you you protect them? Technology has made trade secret theft even easier and more prevalent. In fact, businesses lose billions of dollars every year due to trade secret theft committed by employees, competitors, and even foreign governments. But what is a trade secret? And how do you protect […]
Author: Ronald S. Bienstock
What Is Title Insurance? Safeguarding Against Title Defects
If you are considering the purchase of a property, you may wonder — what is title insurance, do I need it, and why do I need it? Even seasoned property owners may question if the added expense and extra paperwork is really necessary, especially considering that people and entities insured by title insurance make fewer […]
Author: Patrick T. Conlon
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Halcon Resources Files for Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman
Halcon Resources Files Chapter 11
Recently, Halcon Resources, one of the largest energy exploration and production companies in the U.S., announced that it will file for Chapter 11 bankruptcy protection. According to Oil and Gas 360, the company has negotiated a prepackaged agreement with its primary noteholders to eliminate $1.8 billion from its debt total.
Halcon Resources’ mounting debt load lands it in insolvency
In 2015, Halcon had a series of debt-for-equity swaps that converted $258 million in unsecured notes into 144.8 million shares of common stock for noteholders such as Union Square Park Partners, Pioneer Investments, JPMorgan Securities, Goldman Sachs Asset Management and Franklin Templeton Investment.
In its recent financial report, dated May 9, Halcon listed only $8.6 million in cash on its balance sheet after it recorded a $539.99 million net loss for the first quarter of this year. Its stock on the New York Stock Exchange closed recently at 26.1 cents, which represented a 72 percent drop from 97 cents in less than one week.
Halcon Resources’ reorganization plan
In its bankruptcy documents, the company stated that it will restructure its balance sheet as part of a deal reached with senior noteholders. The plan calls for Halcon Resources’ annual interest debt load to be reduced by over $200 million. The debtholders will own majority shares in the newly restructured organization, while preferred shareholders will receive $11.1 million in cash and common shareholders will receive 4 percent of pro forma equity.
The Street reported that the terms of the deal will provide certain shareholders $1.02 billion in 13 percent third-lien notes by 2022, $297.2 million in 8.875 percent senior unsecured notes in 2022, $37.2 million in 9.25 percent senior unsecured notes in 2022, $315.5 million in 9.75 percent senior unsecured notes in 2020, $267.75 million in 8 percent convertible senior unsecured notes in 2020 and 5.75 percent perpetual convertible preferred stock.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
For more articles dealing with energy companies filing for Bankruptcy, check out:
- Chaparral Energy Inc. files for Chapter 11 Bankruptcy Protection
- Energy & Retail Lead the Way as Business Bankruptcies Increase
- SunEdison Prepping to File for Chapter 11 Bankruptcy