PETROQUEST ENERGY INC

PETROQUEST ENERGY INC terminated the registration of a class of securities, ending its reporting obligation for them.

listing compliance notice

On January 31, 2019 the bankruptcy court confirmed PetroQuest's Chapter 11 plan (the first amended plan, immaterially modified January 28), meeting the January 31 confirmation target. Existing common stock (25,587,441 shares at January 29, 2019) and Series B preferred (1,495,000 shares) will be cancelled on the effective date with no distribution or value to shareholders, while the $50 million term loan is repaid in cash from a new exit facility and the 2021 note and PIK note holders get 100% of the new equity (diluted by management incentive shares and the exit-facility backstop premium) plus $80 million of new PIK notes due 2024. The company is targeting an effective date on or before February 8, 2019 but gives no assurance, and technical plan amendments are possible.

bankruptcy or receivership

On November 6, 2018 PetroQuest and certain subsidiaries filed Chapter 11 in the Southern District of Texas (Case No. 18-36322), with a Restructuring Support Agreement signed by holders of 81.83% of the 2021 notes, 84.76% of the 2021 PIK notes and supporting term loan lenders. Under the plan, existing common and preferred stock would be extinguished with no distribution to shareholders; the $50 million term loan would be paid in cash from an exit facility, and the 2021 note and PIK note holders ($9.427 million and $275.0 million of claims) would receive 100% of the new equity (subject to dilution from management incentive shares and a backstop premium) plus $80 million of new 10% PIK notes due 2023. This resolves the forbearance thread by choosing Chapter 11 over a private exchange, and the filing also accelerates the debt and includes a motion to restrict trading in the equity to preserve tax attributes. Plan milestones: solicitation by November 20 and confirmation order by December 21, 2018. This is a proposed plan, not yet confirmed.

bankruptcy or receivership

PetroQuest bought another week from its creditors. Having skipped about $14.2 million of interest due on its two sets of 2021 second-lien notes in August, it extended forbearance with its term lenders and with holders of 77.9% of the notes and 70.7% of the PIK notes to 6 November, and said openly that Chapter 11 was among the options being weighed. The fourth such extension in six weeks - the negotiation, not the default, was now the story.

debt default or forbearance

On September 28, 2018 PetroQuest extended all three forbearance agreements (term loan lenders, 2021 notes holders, 2021 PIK notes holders) from September 28 to October 5, 2018. The $14.2 million August interest remains unpaid, and the company says it is still evaluating private debt exchanges or Chapter 11. No resolution yet, only another one-week delay.

material agreement

Effective September 14, 2018, PetroQuest signed forbearance agreements with the term loan lenders and with holders of about 77.9% of the 2021 notes and 70.7% of the 2021 PIK notes. All agree not to act on the unpaid $14.2 million August interest until September 28, 2018. The company says it is weighing private debt exchanges or a Chapter 11 filing and is negotiating with these creditors, with Seaport Global and Porter Hedges as advisors. It says it continues to pay suppliers and fund operations. This extends the August 15 missed-payment thread and puts bankruptcy on the table for the first time.

material agreement

On August 31, 2018 PetroQuest signed a new $50 million Multidraw Term Loan Agreement with Wells Fargo as agent, replacing the October 2016 loan, and borrowed the full $50 million at 10% interest, maturing October 17, 2020. It used $32.5 million to repay the previous loan and kept the balance, leaving no borrowing availability and about $25 million of cash. The loan has a first-priority lien on substantially all assets, a required reserves-value coverage ratio of 1.4x at September 30, 2018 and 1.5x from December 31, 2018, and still bars Series B preferred dividends. This was done during the forbearance on the missed note interest, and the filing says the company was in compliance with the covenants.

debt financing

PetroQuest chose not to pay about $14.2 million of semi-annual interest due August 15, 2018 on its 2021 second lien notes and 2021 PIK notes, stating this was to preserve liquidity. The term loan agent (Wells Fargo) and lenders agreed to forbear, meaning not act on the resulting defaults, until the earlier of September 14, 2018 or a further default. This is the first missed interest payment in the company's history shown here, and it puts the PIK-notes structure from 2016 under strain.

material agreement

PETROQUEST ENERGY INC's exchange filed to remove a class of its securities from listing.

listing compliance notice

On May 4, 2018 the NYSE suspended trading in PetroQuest stock and began delisting proceedings because the average market capitalization over 30 trading days was below $15 million. The shares began trading on the OTCQX market on May 7, 2018 under the symbol PQUE. The company can seek review by an NYSE committee and says it is considering what actions to take. This is the delisting threat flagged in the April notice and ends the long-running NYSE listing thread, although the formal delisting process may still continue.

listing compliance notice

On April 11, 2018 the NYSE told PetroQuest its stock fell below listing standards because the average closing price was under $1.00 over the 30 trading days ending April 9, 2018. The company has six months to get back above $1.00. Its market capitalization had also recently fallen below $15 million, and if the 30-trading-day average is under $15 million the NYSE will immediately suspend trading and start delisting. This is a worse price-based warning than the 2015 and June 2017 notices, which concerned price and market value or equity under $50 million.

listing compliance notice

On January 31, 2018 PetroQuest's subsidiary sold certain producing Gulf of Mexico oil and gas assets to Northstar Offshore Ventures LLC, effective December 1, 2017. It received no sale proceeds and must contribute $3.75 million to future abandonment costs, but it removes an approximate $35.4 million undiscounted abandonment liability and it expects a cash refund of about $10.3 million of bond collateral. If Northstar fails to post replacement bonds or security within a reasonable time, PetroQuest can rescind the sale. The filing also mentions 2017 reserves estimates in a news release, but the figures are not in the text provided.

material agreement

In December 2017 PetroQuest agreed to buy leases on about 24,600 gross acres of Austin Chalk in central Louisiana from Navitas Oil & Gas for up to about $18.8 million cash plus 2,000,000 new shares, with a first test well planned for Q2 2018. It funded this with $8.75 million from selling East Texas water disposal assets and about $6 million of cash. It also agreed to swap $4.75 million of 2021 notes for 2,240,000 shares, subject to NYSE approval, and the term loan lenders consented to the purchase. This is a new oil play and adds dilution, but cuts some debt.

asset acquisition disposition

On June 12, 2017 the NYSE told PetroQuest it fell below listing standards because average market value over 30 trading days was under $50 million and equity was under $50 million. The company has 45 days to submit a business plan, and the stock keeps trading while the plan is accepted and monitored. This repeats the equity and market value warning first received in December 2015.

listing compliance notice

On Oct 17, 2016 PetroQuest signed a Multidraw Term Loan Agreement with Franklin Income Fund and Wells Fargo as agent, for up to $50 million at 10% interest, available to draw for three years and maturing Oct 17, 2020. It replaces the JPMorgan bank facility, whose borrowing base had been cut to $0; nothing is borrowed yet. It is secured by a first-priority lien and carries reserve-coverage covenants and a ban on Series B preferred dividends. This delivers the Franklin commitment from August, though the filing says three-year availability against the four-year term described earlier.

debt financing

On Sept 27, 2016 PetroQuest closed its exchange offers: holders of $243.468 million of old 2017 and 2021 notes (about 86.9% of the total) tendered and received $243.468 million of new 10% Second Lien Senior Secured PIK Notes due Feb 15, 2021 plus 3,517,000 new common shares. This completes the August exchange thread; the shares dilute existing holders, and the new notes carry an option to pay part of the interest in kind for the first three interest dates. The filing states the new notes are second-lien, behind the bank facility. The text provided is cut off, so the effect on the remaining 2017 notes is not shown.

capital raising announcement

On Sept 1, 2016 PetroQuest chose not to pay the interest due on its 2017 notes and entered the 30-day grace period, and JPMorgan agreed to forbear on the resulting bank defaults until the earlier of Oct 1, 2016 or a forbearance default. The company says that if the exchange offers fail it will consider alternatives including a Chapter 11 filing, and that even if they succeed it may seek bankruptcy protection without further liquidity improvement and debt restructuring. This is the first explicit mention of bankruptcy in the filings and raises the risk for shareholders.

material agreement

On Aug 25, 2016 PetroQuest cut its bank borrowing base and commitments from $22.5 million to $0, with the lenders (other than JPMorgan, which stays as sole lender) leaving the facility, and approved up to $280.3 million of new second-lien PIK notes. It launched new exchange offers for the remaining 2017 notes ($135.6 million) and the 2021 notes ($144.7 million) into new 10% PIK notes plus up to 3,517,000 shares, with support agreements covering about 79% of the old notes. Franklin Income Fund also committed to a $50 million four-year first-lien term loan, conditional on at least 87% of the old notes exchanging and closing by Oct 21, 2016. This reverses the February deal's aim of a lasting fix and adds a new exchange and dilution.

material agreement

On June 20, 2016 the Fourteenth Amendment to the bank credit agreement cut the borrowing base and lender commitments from $32 million to $22.5 million and suspended the financial covenants until the first borrowing or letter of credit. Borrowing is effectively blocked: the company expects to be able to use $0 for now, and later no more than $5 million, with excess cash above $10 million required to prepay. The company also filed a risk factor saying the limited access could constrain funding of development. No borrowings were outstanding at June 20, 2016. This further shrinks the bank facility (the $42 million level in January had already fallen to $32 million by this filing, a step not described here).

material agreement

On April 20, 2016 PetroQuest's subsidiary sold the majority of its remaining Woodford Shale assets in the East Hoss field to GR Woodford Properties, LLC for about $18 million gross (before customary adjustments, effective April 1, 2016). The filing does not say how the proceeds will be used. This appears to be the Oklahoma asset sale the bank amendment had allowed by March 31, 2016, though the filing does not link them and the closing came after that date (inference).

material agreement

On Feb 17, 2016 PetroQuest completed its exchange offer for the 10% 2017 notes: holders of $214.379 million (about 61% of the notes) tendered, and received about $53.6 million cash, $144.674 million of new 10% Second Lien Senior Secured Notes due Feb 15, 2021 and 4,287,580 new common shares. The offer had been for up to $300 million, so the result fell short of the maximum; the filing says the new notes are secured by second-priority liens behind the bank facility. Note the filing states the 2021 notes' principal as $214.379 million, while the issued amount is $144.674 million (the filing's own wording). This completes the exchange thread launched in January and dilutes existing shareholders with the new shares.

capital raising announcement

On February 1, 2016 PetroQuest signed a Fourth Supplemental Indenture removing most restrictive covenants and some default provisions on the 10% 2017 notes after enough holders consented; it only takes effect when the exchange offer completes. The exchange offer is for up to $300 million of those notes in return for up to $75 million cash, $202.5 million of new 10% Second Lien Senior Secured Notes due 2021 and 6,000,000 common shares; a Feb 3 press release gave early-tender results, but the figures are not in the text provided. U.S. Bank replaced Bank of New York Mellon as trustee. This is the first sign of the 2017 notes refinancing that the credit amendments anticipated.

material agreement

On January 25, 2016 PetroQuest signed a Thirteenth Amendment to its bank credit agreement, cutting the borrowing base and commitments from $55 million to $42 million, with usage expected to be limited to about $10.5 million (25% of commitments) in the first quarter. It loosens the debt to EBITDAX limits (5.0x for March 2016, up to 5.75x later), replaces the current ratio test with a minimum EBITDAX to cash interest of 1.0x, allows up to $300 million of second-lien debt for the previously announced exchange of the 2017 notes, and permits a cash sale of most remaining Oklahoma assets by March 31, 2016 (borrowing base falls $10 million on that sale). It also bars preferred dividends on the 6.875% Series B preferred stock and removes the stock buyback allowance. No borrowings were outstanding at January 25, 2016.

material agreement

On December 28, 2015 the NYSE sent a second notice: PetroQuest's average market value fell below $50 million over 30 trading days while its stockholders' equity was also under $50 million. The company has 45 days to submit a business plan to regain compliance within 18 months, and the stock keeps trading in the meantime. This adds to the share-price notice of December 8.

listing compliance notice

On December 8, 2015 the NYSE told PetroQuest it fell short of the continued listing rule because the average share price was below $1.00 for over 30 consecutive trading days. The company has six months to get back above $1.00 (closing price and 30-day average) to avoid delisting, and the stock stays listed meanwhile. This is a new listing issue, separate from the clerical NYSE letter of 2013.

listing compliance notice

On September 8, 2015 PetroQuest signed a Twelfth Amendment to its bank credit agreement: the borrowing base and lender commitments were each cut from $70 million to $55 million, and the debt to EBITDAX limits were reset (4.0x for Sept 30, 2015, then 4.5x or 5.75x depending on unused availability, 5.0x from March 2017). It allows the company to redeem the 2017 notes with cash by June 30, 2016 if at least 25% availability remains, and requires a first-priority lien on at least 90% of oil and gas property value. No borrowings were outstanding at August 31, 2015.

material agreement

On June 4, 2015 PetroQuest sold most of its Woodford Shale and Mississippian Lime assets to WSGP Gas Producing, LLC for gross proceeds of about $280 million (before post-closing adjustments, effective Jan 1, 2015); about $14 million of that is deferred and tied to wells PetroQuest operates for WSGP. WSGP is the same buyer of the 2010 Woodford half-stake sale. In the same filing, the Eleventh Amendment to the bank credit agreement cut the borrowing base from $190 million to $70 million (commitments from $170 million to $70 million, settling the interim review due by July 1), released liens on Oklahoma assets, allowed up to $350 million of second-lien debt (no more than $50 million for purposes other than redeeming the 2017 notes), extended maturity to June 4, 2020 (or Feb 19, 2017 if 2017 notes remain unrefinanced), and replaced the covenants with a max total debt/EBITDAX of 4.0x and a 1.0x current ratio. This resolves the earlier open Woodford/WSGP thread in part (deferred payments now set out) and the interim redetermination thread.

asset acquisition disposition

On March 27, 2015 PetroQuest signed a Tenth Amendment: the borrowing base was cut from $220 million to $190 million (commitments unchanged at $170 million) and the minimum current assets to current liabilities ratio was lowered to 0.75x for the March and June 2015 quarters, then 1.0x. The company had $85 million drawn as of March 30, says it is in compliance, and has requested an interim redetermination by July 1, 2015 so its Thunder Bayou discovery well, expected to start production in early May 2015 at about 38,000 Mcfe/d, can be counted.

material agreement

On July 3, 2013 PetroQuest closed the $200 million offering of 10% Senior Notes due 2017, guaranteed by PetroQuest Energy L.L.C. and TDC Energy LLC. The notes are unsecured, rank equally with the existing $150 million of 10% notes, and sit behind the secured bank facility. The company also agreed to register the notes for exchange, with extra interest of up to 1% a year if this is not done within 300 days. The filing also lists an Item 2.01 completion of the Gulf of Mexico acquisition announced June 19, but the text provided is cut off before the closing details, so the closing and final price are not confirmed here.

asset acquisition disposition

On June 28, 2013 PetroQuest priced $200 million of new 10% Senior Notes due 2017, issued at face value plus interest from March 1, 2013, with terms substantially identical to its existing $150 million of 10% notes due 2017. The money is meant to pay for the Gulf of Mexico acquisition announced June 19, with any remainder for general corporate purposes. If the Hall acquisitions have not closed by Aug 9, 2013, the notes are redeemed from escrowed funds, and $50 million must be redeemed if the GOM-H purchase does not close. This is the permanent financing for the acquisition, replacing the bridge commitment in practice.

material agreement

On June 19, 2013 PetroQuest agreed to buy producing shallow-water Gulf of Mexico oil and gas assets from Hall-Houston Exploration II, III and IV and GOM-H Exploration for about $193 million in cash, effective Jan 1, 2013, with closing expected around July 3, 2013; a $5 million deposit is held in escrow. A Sixth Amendment to the credit facility permits the deal (if liquidity stays at $40 million or more), allows up to $200 million of acquisition debt, raises the borrowing base from $150 million to $200 million and lender commitments from $100 million to $150 million once the Hall-Houston purchases complete, and loosens the debt-to-EBITDAX limit from 3.0x to 3.5x from Sept 30, 2013. A bridge loan commitment of up to $185 million is in place as a backstop if other financing is not obtained. This is a new acquisition and is separate from the Eagle Ford sale permitted in March.

debt financing

On March 29, 2013 PetroQuest signed a Fifth Amendment raising its borrowing base from $130 million to $150 million. This was treated as the scheduled redetermination. The amendment permits an 'Eagle Ford Sale' and disregards those assets for borrowing base reductions if the sale closes by September 30, 2013. The filing also reports new gas swaps for April to December 2013, 5,000 MMbtu a day each at $4.05 and $3.74. The company says it now has about 13.1 Bcf of gas hedged for 2013 (49% of estimated gas production at an average $3.57/Mcf) and about 3.7 Bcf for 2014.

debt financing

On October 4, 2011 PetroQuest signed a Fourth Amendment to its credit agreement, extending maturity to October 3, 2016 and raising the borrowing base from $100 million to $125 million. Lender commitments are $100 million and can rise to $300 million. The company had no borrowings outstanding and was in compliance with its covenants. The amendment also permits up to $10 million of share buybacks, subject to a liquidity test, and lowers the share of properties that must be pledged as security from 85% to 80%.

debt financing

PetroQuest closed the purchase of 28,250 acres of Mississippian Lime in Pawnee County, Oklahoma for an adjusted $24.1 million. The acreage has about 50 Boe/d of production and five saltwater disposal wells. It then sold a 50% working interest in the Pawnee acreage for about $14.5 million. The company now has about 24,000 net acres in Oklahoma and Kansas and expects to spud its first Mississippian Lime well near the end of the year. This is a new area for the company.

drilling progress report

On August 19, 2010 PetroQuest closed the $150 million 10% Senior Notes due 2017 (due September 1, 2017, guaranteed by its subsidiaries, with interest starting March 1, 2011). It also bought a majority of the 2012 notes in the tender offer, and a supplemental indenture removed substantially all of that older issue's restrictive covenants. The remaining proceeds and cash on hand are intended to redeem or repurchase any 2012 notes not tendered. This completes the refinancing started earlier in the month.

security holder rights change

On August 12, 2010 PetroQuest priced a $150 million public offering of 10% Senior Notes due 2017 at par, with closing set for August 19, 2010. Net proceeds of about $146.2 million are meant to fund the tender offer and consent solicitation for the 10 3/8% notes due 2012. This is the new debt that replaces the 2012 notes, at a lower stated interest rate and a later maturity.

material agreement

On August 5, 2010 PetroQuest started a cash tender offer for all of its $150 million 10 3/8% Senior Notes due 2012, and asked holders to consent to removing most of the notes' restrictive covenants. A Third Amendment to the bank credit agreement the same day lets it issue up to $200 million of new debt to refinance those notes. It also gives more time and options to repay if the borrowing base is cut. This acts on the open question of how the 2012 notes would be dealt with.

material agreement

On May 24, 2010 PetroQuest sold WSGP Gas Producing, LLC (a NextEra Energy Resources subsidiary) an undivided 50% of its proven undeveloped Woodford Shale reserves, plus certain rights over 50% of its undeveloped Woodford acreage, for $60 million cash. WSGP will also pay $14 million on Nov 30, 2011, and a further $14 million if drilling performance targets are met. It will fund part of PetroQuest's drilling costs, up to $54 million in Phase 1 and up to $92.6 million in Phase 2 if it opts in. This is a partial sale of the Woodford Shale position that was under strategic review, and it creates a new joint venture partner.

material agreement

On September 30, 2009 PetroQuest amended its bank credit agreement a second time, cutting the borrowing base from $130 million to $100 million effective October 1, 2009. This is the redetermination that was due by Sept 30, 2009. The company had $100 million drawn and said it was in compliance with its covenants. It estimated cash of about $80 million. The amendment removes the $10 million minimum liquidity requirement and lets certain property sales be paid in asset exchanges rather than only cash. A same-day press release also raised third quarter production guidance, but the filing gives no figures for it.

material agreement

On June 24, 2009 PetroQuest priced a public offering of 10,000,000 new common shares at $3.50 each, with underwriters then taking an extra 1,500,000 shares, for expected net proceeds of about $37.7 million. Closing was scheduled for June 30, 2009. This dilutes existing shareholders by issuing 11.5 million new shares and brings in cash; the filing does not say how the money will be used.

material agreement

On March 24, 2009 PetroQuest amended its October 2008 credit agreement, cutting the borrowing base from $150 million to $130 million. The amendment adds a requirement to keep at least $10 million of liquidity, raises interest margins (Eurodollar margin now 2.5% to 3.5%, previously 1.5% to 2.25%), and waives the company's failure to deliver a reserve report and related items by March 1, 2009. The company estimated cash of about $30 million at February 28, 2009. This reverses the run of borrowing base increases through 2008.

material agreement

On October 2, 2008 PetroQuest replaced its prior credit facility with a new $300 million revolving credit facility (JPMorgan Chase as agent, with Calyon, Bank of America, Wells Fargo and Whitney) maturing February 10, 2012, or October 2, 2013 if the 10 3/8% senior notes due 2012 are prepaid or refinanced. The initial borrowing base is $150 million, the facility is secured by liens on substantially all assets of the borrower and subsidiaries, and $62 million was outstanding. Covenants include a maximum debt to EBITDAX of 3.0x and a minimum current ratio of 1.0x. Before the replacement, lenders had waived the current-ratio covenant from September 30 to November 30, 2008.

debt financing

PetroQuest signed a Second Amended and Restated Credit Agreement on November 18, 2005 with JPMorgan Chase, Macquarie Bank and Calyon, giving a $100 million revolving facility maturing November 19, 2009. The initial borrowing base is only $25 million, with $6 million drawn. It is secured by its oil and gas properties and carries a maximum debt-to-EBITDA ratio of 2.5 to 1. It replaces the earlier credit agreement that had been amended eight times.

debt financing

the New York Stock Exchange certified PETROQUEST ENERGY INC's securities for listing, clearing them to begin trading.

listing compliance notice

PetroQuest closed the remaining two of its four Oklahoma purchase agreements on July 1, 2005 for an adjusted $21.3 million, covering producing gas properties and four gas gathering systems. The extra 20% interest that had been proposed was not part of this closing. The price was paid with remaining proceeds from the 10 3/8% Senior Notes offering. This completes the Oklahoma acquisition thread started in the June amendment.

asset acquisition disposition

PetroQuest closed a $25.0 million add-on to its 10 3/8% Senior Notes due 2012 (priced at 99% of face, yielding 10.578%), bringing the total to $150.0 million alongside the $125.0 million issued on May 11, 2005. Its bank lenders also amended the credit agreement to allow the notes and to remove the cap on general and administrative expenses. For shareholders this adds unsecured debt with interest due each May 15 and November 15.

debt financing