Goodrich Petroleum Corp. has reached an agreement with creditors to use its "best efforts" to file for Chapter 11 by April 15 with a prepackaged plan to reorganize and emerge from court as an operating business.
The new plan of reorganization would give second-lien lenders an equity stake in the newly reorganized company, according to a statement.
The agreement comes after Goodrich’s debt-for-equity exchange offer failed to gain enough traction among debtholders. The company extended the offer a final time to April 8. As of March 31, it fell short of the participation levels it required, with only 61 percent of its unsecured notes tendered of the 95 percent needed.
On March 16, Goodrich delayed releasing its annual report, citing a large loss that auditors have determined may affect the company’s ability to operate as a going concern. The loss comes "mainly as a result of substantial impaired asset writedowns," Goodrich said in the filing.
In prepackaged reorganizations, companies win support for their plans from almost all bondholders before filing Chapter 11 and asking a judge to impose the deals on dissidents.
Its most actively traded debt, $117 million of 8.87 percent unsecured bonds due 2019, last traded at .375 cents on the dollar on Feb. 17, down from as high as 54.5 cents on April 27, 2015, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.