SAExploration revises plan, amends support and backstop agreements

By Sarah Lizee

Olympia, Wash., Nov. 4 – SAExploration Holdings, Inc. revised its plan and related disclosure statement and made some amendments to its restructuring support agreement and backstop commitment agreement, according to an 8-K filing with the Securities and Exchange Commission.

Revised plan and statement

The revised plan and disclosure statement provide, among other things, for the modification of the treatment of certain claims and interests.

Holders of asset-based credit agreement claims will receive their pro rata share of participation in the second-lien exit facility, the right to purchase under the rights offering up to its pro rata share of the first-lien term loans and the new first-lien exit facility equity and the payment in full in cash on the effective date of all accrued pre-petition and post-petition interest under the ABL credit agreement.

Holders of term loan credit agreement claims will receive their pro rata share of 100% of the new common shares to be issued by the reorganized company under the plan, subject to dilution, and the right to purchase under the rights offering up to its pro rata share of the first-lien term loans and the new first-lien exit facility equity.

Convertible note claims, general unsecured claims and existing common stock and related warrants will be discharged with no distribution.

Support agreement amendment

Under the Nov. 1 restructuring support agreement amendment, some Chapter 11 milestones were revised so that provisional approval of the disclosure statement takes place by Nov. 5, the plan is confirmed by Dec. 17 and the effective date occurs by Dec. 31.

As outlined in the amended restructuring support agreement, the company’s restructuring transactions will include entering into a $15 million first-lien exit term loan facility and converting the existing ABL facility into a new $20.5 million second-lien exit facility with existing lenders of the ABL facility.

In addition, the company will begin a backstopped rights offering under which all eligible holders of loans under the ABL facility and loans under the term loan credit agreement will be offered the opportunity to purchase loans to be advanced under the first-lien exit facility and new shares of common stock in the reorganized company for an aggregate purchase price of $15 million.

The new common shares to be issued will constitute 95% of the new common shares as of the effective date, subject to dilution only by the management incentive plan.

Backstop premium

As consideration for the backstop commitment, a premium payable to the backstop parties will equal a number of (a) new common shares equal to 2.5% of the outstanding new common shares to be issued by the reorganized company, subject to dilution only by the post-effective date management incentive plan, under which new common shares in the aggregate amount of 9% of the new common shares, on a fully diluted basis, will be reserved and allocated as part of the compensation provided to the reorganized company’s management, or (b) cash in the aggregate amount of $850,000, if the backstop agreement is terminated in some circumstances.

SAExploration is a Houston-based oil field services company. The company filed bankruptcy in the U.S. Bankruptcy Court for the Southern District of Texas on Aug. 27 under Chapter 11 case number 20-34306.

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