Finance & Investing | Debt | Bankruptcy / Restructure Update | Capital Markets

Triangle's Bakken - Focused E&P Arm Files Chapter 11

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Triangle USA Petroleum Corporation and its affiliates today filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware to implement the terms of a Plan Support Agreement that will facilitate the restructuring of its balance sheet.

• TUSA expects to continue its operations without interruption
• At the time of its Chapter 11 filing, TUSA had approximately $88 million in cash and cash equivalents.
• Entered into a PSA with holders of ~73% of TUSA's $381 million 6.75% Senior Unsecured Notes due 2022, provides for the Notes to be converted into equity
• Continue discussions with other stakeholders including other noteholders, the bank group in its senior reserve-backed credit facility and parties with which TUSA currently has midstream agreements

TUSA is a wholly-owned subsidiary of Triangle Petroleum Corporation.

Neither TPLM nor its affiliated company, RockPile Energy Services, LLC, is included in TUSA's Chapter 11 filing.

Ranger Fabrication, LLC, a minor, wholly-owned subsidiary of TPLM that ceased operating earlier this year, has filed for bankruptcy alongside TUSA in order to complete an orderly wind down of its affairs.

TUSA expects to continue its operations without interruption and has more than adequate liquidity to fund its operations during the restructuring process.

At the time of its Chapter 11 filing, TUSA had approximately $88 million in cash and cash equivalents.

TUSA has requested Court approval to utilize cash collateral as approved under an agreement with its bank group. Accordingly, TUSA does not expect to seek debtor-in-possession financing.

Following several months of negotiations, TUSA has entered into a PSA with holders of approximately 73% of TUSA's $381 million 6.75% Senior Unsecured Notes due 2022.

The PSA provides for the Notes to be converted into equity and a new money rights offering for $100 million, which will be backstopped by a commitment from certain Participating Noteholders. TUSA's existing reserve-backed credit facility will be paid in full from a new revolving credit facility, existing cash at emergence, and proceeds of the new money rights offering.

TUSA plans to utilize the Chapter 11 process to continue discussions with other stakeholders, including other noteholders, the bank group in its senior reserve-backed credit facility and parties with which TUSA currently has midstream agreements, including affiliates of Caliber Midstream Partners, L.P.

TUSA has filed a variety of customary "first day" motions with the Court seeking, among other things, authority to maintain its existing cash management system, and the ability to make payments to royalty interest holders, working interest partners, and with respect to wages and benefits, lease operating expenses, drilling and production costs, and other related operating costs, and other customary relief. When granted, such motions will ensure TUSA's ability to maintain operations without interruption throughout the restructuring process.

John Castellano of AP Services, LLC has been appointed TUSA's Chief Restructuring Officer.