Pacific Drilling – Files Amendment in Plan to Report on New First Lien Notes & New Second Lien PIK Toggle Notes

Register, or to view the article

September 1, 2018 – Pacific Drilling filed with the Court a First Amended Joint Plan of Reorganization [Docket No. 551] and related Disclosure Statement [Docket No. 552]. The Disclosure Statement notes, “The Restructuring pursuant to the Plan and the related documents provide for the comprehensive recapitalization of the Debtors through the following principal financing transactions (collectively, the “Exit Financing Transactions”): 

(a) $700.0 million issuance of notes maturing five years following their issuance, secured by a first-priority security interest in and Lien on the New Notes Collateral (as defined herein) (the ”New First Lien Notes”) fully committed by the initial purchaser (the “Initial Purchaser”) and for which QPGL and/or its designees have agreed to place orders for at least $100.0 million; 
(b) $300.0 million issuance of notes maturing seven years after their issuance, with interest payable in kind or in cash, subject to certain limitations, at the option of the issuer, secured by a second-priority security interest and lien on the New Notes Collateral (the “New Second Lien PIK Toggle Notes,” and together with the New First Lien Notes, the “New Notes”), which will be marketed by the Initial Purchaser on a best-efforts basis and fully backstopped by the Ad Hoc Group, and for which QPGL and/or its designees have agreed to place orders for at least $100.0 million; 
(c) $350.0 million equity rights offering (the ”Rights Offering”)3 that will provide Holders of Allowed Term Loan B Claims, 2017 Notes Claims, and 2020 Notes Claims (collectively, the “Undersecured Claims”) with subscription rights to purchase up to 44.8% of the common shares of Reorganized PDSA (the “New Common Shares”) outstanding on the Effective Date (the ”Rights Offering Subscription Rights”), at a price that represents an implied 46.9% discount to a stipulated plan equity value of $1,472 million (based on a  total  enterprise  value  of  $2,075  million  (the ”Equity Purchase Price”), which may be subject to dilution by the new equity issued pursuant to the management incentive plan to be implemented by Reorganized PDSA, as approved by the New Board of Reorganized PDSA on or after the Effective Date (the “Management Incentive Plan”); 
(d) $100.0 million private placement (the “AHG Private Placement”) to the members of the Ad Hoc Group and certain other holders of the Undersecured Creditors that will obligate such parties (in such capacity, the “Reserve Parties”) to purchase 12.8% of the aggregate number of New Common Shares outstanding on the Effective Date, subject to conditions, and subject to dilution by the new equity issued pursuant to the Management Incentive Plan; and 
(e) $50.0 million private placement (the “QPGL Private Placement,” and together with the AHG Private Placement, the “Private Placements,” and collectively, such Private Placements together with the Rights Offering, the “Equity Issuance”) to QPGL that will obligate QPGL to purchase 6.4% of the aggregate number of New Common Shares outstanding on the Effective Date, subject to conditions, and subject to dilution by the new equity issued pursuant to the Management Incentive Plan..”
The following is a summary of classes, claims and voting rights:

  • Administrative Claims: Have an estimated recovery of 100% and are not entitled to vote.
  • Priority Tax Claims: Have an estimated recovery of 100% and are not entitled to vote.
  • Classes 1A – 1E – Secured Tax Claims: Have an estimated allowed amount of $0.00, an estimated recovery of 100% and are unimpaired/deemed to accept.
  • Classes 2A – 2E Other Secured Claims: Have an estimated allowed amount of $0.00, an estimated recovery of 100% and are unimpaired/deemed to accept.
  • Classes 3A – 3E Other Priority Claims: Have an estimated allowed amount of $0.00- $1.0 million, an estimated recovery of 100% and are unimpaired/deemed to accept. 
  • Class 4A RCF Claims: Have an estimated allowed amount of $480,356,944.00, an estimated recovery of 100% and are unimpaired/deemed to accept.
  • Class 5B SSCF Claims: Have an estimated allowed amount of $661.5 million plus applicable interest, an estimated recovery of 100% and are unimpaired/deemed to accept.
  • Class 6A(i) Term Loan B Claims: Have an estimated allowed amount of $724.9 million, an estimated recovery of 37% and are impaired/entitled to vote.
  • Class 6A(ii) 2020 Notes Claims: Have an estimated allowed amount of $768.1 million, an estimated recovery of 37% and are impaired/entitled to vote. 
  • Class 6C 2017 Notes Claims: Have an estimated allowed amount of $453.6 million, an estimated recovery of 46.7% and are impaired/entitled to vote. 
  • Classes 7A – 7E General Unsecured Claims: Have an estimated allowed amount of $1.0 $2.0 million, an estimated recovery of 100% and are unimpaired/deemed to accept. 
  • Classes 8A – 8E Section 510(b) Claims: Have an estimated allowed amount of $0.0, an estimated recovery of 0.0% and are impaired/deemed to reject. 
  • Class 9A – 9E Intercompany Claims: Have an estimated recovery of 0.0% -%100% and are unimpaired/deemed to accept [or] impaired/deemed to reject.
  • Class 10D PDSA Interests: Have an estimated recovery of 0.0% and are impaired/deemed to reject. 
  • Classes 11A, 11B, 11C, and 11E Intercompany Interests: Have an estimated recovery of 0.0% -%100% and are unimpaired/deemed to accept [or] impaired/deemed to reject.

Read more Bankruptcy News