not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws. This Current Report on Form 8-K does not constitute an offer to sell or buy, nor the solicitation of an offer to sell or buy, any securities referred to herein, nor is this Current Report on Form 8-K a solicitation of consents to or votes to accept any chapter 11 plan. Any solicitation or offer will only be made pursuant to a confidential offering memorandum and disclosure statement and only to such persons and in such jurisdictions as is permitted under applicable law.
DIP Facility
Subject to the approval of the Bankruptcy Court (as defined below), the Debtors expect to enter into a senior secured superpriority debtor-in-possession letter of credit facility (the “DIP Facility”), pursuant to that certain Senior Secured Debtor-In-Possession Credit Agreement, by and among the Debtors, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other parties thereto (the “DIP Credit Agreement”).
The DIP Facility is expected to be in an aggregate principal amount of $120 million, subject to availability under the Debtors’ borrowing base thereunder. On the effective date of the DIP Facility, the Debtors expect that all of the outstanding undrawn letters of credit under the Existing ABL Facility will be deemed outstanding under the DIP Facility.
The DIP Credit Agreement will include protections customary for financings of this type and size, including superpriority claims and priming liens on substantially all of the Debtors’ assets that were encumbered under the Existing ABL Facility, liens on previously unencumbered assets (other than owned real property), and other protections to be set forth in the orders approving the DIP Facility. The DIP Credit Agreement is expected to include conditions precedent, representations and warranties, affirmative and negative covenants, events of default, and other provisions customary for financings of this type and size.
The foregoing description of the DIP Facility does not purport to be complete and is qualified in its entirety by reference to the full text of the DIP Credit Agreement, which will be attached to a motion filed with the Bankruptcy Court in connection therewith as part of the Company’s first day pleadings.
Item 1.03
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Bankruptcy or Receivership.
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On December 7, 2020, the Debtors filed voluntary petitions for relief (collectively, the “Petitions”) under the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas (Houston) (the “Bankruptcy Court”). In addition to the Petitions, the Debtors have filed, among other things, a motion with the Bankruptcy Court seeking to jointly administer the Cases under the caption “In re: Superior Energy Services, Inc., et al.”
Concurrently, the Debtors also filed with the Bankruptcy Court the Plan, as contemplated by the Amended RSA. The Debtors will continue to operate their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court.
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