Paragon Offshore plc (OTC: PGNPF) and certain of its subsidiaries have elected to begin proceedings under Chapter 11 of the US Bankruptcy Code in the US Bankruptcy Court in the District of Delaware.
As announced on Feb. 12, Paragon entered into a plan support agreement (PSA) to support a restructuring of Paragon's balance sheet. As of Feb. 15, ,the PSA has been signed by an ad hoc committee representing 77% in the aggregate of holders of its senior unsecured notes and a group comprising 96% of the amounts outstanding under Paragon's senior secured revolving credit agreement. An additional member of the revolving credit agreement group signed the PSA subsequent to the Feb. 12 announcement. Approval of the transaction by the revolver lenders and the bondholders will require that 2/3 in principal amount and 1/2 in number of those voting in each class to approve the transaction.
The company also announced that it has filed certain first-day motions with the court to facilitate operating in the normal course throughout the Chapter 11 process. These motions will ensure that the company's vendors, as well as employees, will continue to be paid. Paragon expects to maintain sufficient liquidity throughout the restructuring process to maintain its business operations.
Weil, Gotshal & Manges LLP is serving as legal counsel to Paragon, and Lazard is serving as financial advisor.