Venoco: Unsecured noteholder agrees to support amended Chapter 11 plan

By Caroline Salls

Pittsburgh, March 24 – Venoco, Inc. entered an agreement in principle under which unsecured noteholder Candlewood Investment Group, LP would join the company’s restructuring support agreement and support an amended Chapter 11 plan on behalf of funds it manages or advises, according to an 8-K filed Thursday with the Securities and Exchange Commission.

Specifically, Candlewood holds about 70% of Venoco’s 8 7/8% senior notes.

Under the amended plan, holders of the 8 7/8% senior notes would receive a $6.5 million cash payment, 2.6% of the common stock in the reorganized company, which will be completed through a transfer of the equity the backstoppers of Venoco’s debtor-in-possession facility are to receive as a backstop fee, as well as a sliding scale 1% to 5% overriding royalty interest to specified oil and gas.

The company said Candlewood would not receive any warrants, as called for in the original plan.

Under the restructuring support agreement, the final DIP financing order must be entered within 45 days of March 18, the support agreement must be approved within 60 days of March 18, the company’s disclosure statement must be approved within 90 days of March 18, the plan must be confirmed within 150 days of March 18, and the plan must take effect within 14 days of the entry of the confirmation order.

Venoco, a Denver-based energy company, filed bankruptcy on March 18 in the U.S. Bankruptcy Court for the District of Delaware. The Chapter 11 case number is 16-10655.

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