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Vanguard Natural Resources Bankruptcy Plan Filed

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Vanguard Natural Resources filed with the U.S. Bankruptcy Court a Second Amended Chapter 11 Plan of Reorganization and related Disclosure Statement.

According to the Disclosure Statement, “Specifically, the Plan provides for: (a) The Rights Offering, consisting of (i) a $10.176081 million rights offering to be conducted in reliance upon the exemption from registration under the Securities Act provided in section 1145 of the Bankruptcy Code (the ‘1145 Rights Offering’), pursuant to which Holders of Senior Notes Claims are entitled to purchase equity in Reorganized VNR Finance (the ‘1145 Rights Offering Equity’), (ii) a $117.698919 million rights offering to be conducted in relianceupon the exemption from registration under the Securities Act provided in section 4(a)(2) of the Securities Act (the ‘Accredited Investor Rights Offering’), pursuant to which Accredited Investor Eligible Holders of Senior Notes Claims are entitled to purchase equity in Reorganized VNR Finance (the ‘Accredited Investor Rights Offering Equity’), and (iii) a $127.875 million equity investment (the ‘4(a)(2) Backstop Commitment’), pursuant to which the Commitment Parties will purchase equity in Reorganized VNR Finance (the ‘4(a)(2) Backstop Commitment Equity’); (b) A fully committed $19.25 million equity investment from the Second Lien Investors for shares of New Common Stock equal to 6.4% of the aggregate New Common Stock as of the Effective Date and subject to dilution as set forth in the Plan (the ‘Second Lien Investment Equity’); (c) A full recovery for Holders of Allowed Lender Claims consisting of (i) cash in the amount of the Credit Agreement Interest plus (ii) cash in the amount of its Pro Rata share of the Glasscock Sale Proceeds.”

In addition, “If the Holder elects (or is deemed to elect, upon its execution of the Exit Facility Credit Agreement) Option 1 on its Ballot, it shall also receive its Option 1 Pro Rata Share of (i) the Lender Paydown, (ii) the Exit Revolving Loans, and (iii) the Exit Term A Loans; (d) The issuance of new notes to Holders of Allowed Second Lien Notes Claims in an aggregate principal amount of approximately $78.075 million, plus accrued and unpaid postpetition interest through the Effective Date (the ‘New Second Lien Notes’).”

Read more VNR bankruptcy news.