Davis Polk is advising an ad hoc group of holders of the second-lien notes of SandRidge Energy, Inc. in connection with SandRidge Energy, Inc.’s May 16 chapter 11 bankruptcy filing in the Bankruptcy Court for the Southern District of Texas. Before the bankruptcy filing, holders of approximately 98% in principal amount outstanding under SandRidge’s reserve-based lending facility, 79% in principal amount of SandRidge’s second-lien notes, and 55% in principal amount of SandRidge’s senior unsecured notes agreed to a Restructuring Support Agreement, filed with the Court on May 16. The RSA contemplates a plan of reorganization that includes, among other things, equitizing approximately $3.7 billion in second-lien and unsecured debt. Under the RSA, the second-lien holders will receive 85% of the new common stock issued by reorganized SandRidge, $300 million in new convertible debt and an opportunity to participate in a $150 million rights offering for new common stock to be issued at a discount to plan value.

SandRidge is an oil and natural gas company with a principal focus on exploration and production activities in the Mid-Continent region of the United States. SandRidge also operates businesses and infrastructure systems that are complementary to its primary exploration and production activities, including gas gathering and processing facilities, marketing operations, a saltwater gathering and disposal system, an electrical transmission system and a drilling and related oil field services business.

The Davis Polk insolvency and restructuring team includes partners Damian S. Schaible and Eli J. Vonnegut, associates Christopher Robertson, Sarah E. Levin and Erik Jerrard. The credit team includes partners James A. Florack and Monica Holland and associate Stevan R.B. Nicholas. The executive compensation team includes counsel Jack T. Wright. Counsel Susan D. Kennedy provided real estate advice. All members of the Davis Polk team are based in the New York office. 

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