Arsenal Resources’ Second Pre-Packaged Chapter 11


Simpson Thacher represented Arsenal Resources in the financial restructuring.

On November 6, 2019, Arsenal executed a restructuring support agreement with all of its principal lenders and the majority of its equity holders, and as a result was able to file for chapter 11 on November 8 with the full support of its creditor constituencies.

Pursuant to the plan, Arsenal’s two largest creditors will exchange over $360 million in outstanding secured debt for a 100% interest in the reorganized company and will infuse the company with $100 million in new equity. In addition, the lenders under Arsenal’s existing revolver facility are providing $90 million in debtor-in-possession financing and have committed to providing $130 million in exit financing upon Arsenal’s emergence from chapter 11. Arsenal expects to consummate the plan and emerge from chapter 11 before year end.

In connection with the restructuring, Arsenal also has successfully negotiated new agreements with two of its major providers of gas gathering and transportation services.

Arsenal Resources is an independent exploration and production company headquartered in Pittsburgh, Pennsylvania that is engaged in the acquisition, exploration, development and production of natural gas in the Appalachian Basin.

The Simpson Thacher team included Michael Torkin (Picture), Kathrine McLendon, Nicholas Baker, Daniel Biller, Edward Linden, Jamie Fell and Chase Bentley (Restructuring); Erland Modesto, Brandan Still, Michael Halper and Michael Paparozzi (Credit); Christopher May, Jim Cross, Brad Honeycutt and Nate Bascom (M&A); Brian Rosenzweig and Matt Hart (Capital Markets); Bill Russell (Litigation); John Creed and Jasmine Hay (Tax); Larry Moss and Pasco Struhs (ECEB); and Elisa Alcabes (Insurance).

Involved fees earner: Elisa Alcabes – Simpson Thacher & Bartlett; Nicholas Baker – Simpson Thacher & Bartlett; Nathaniel Bascom – Simpson Thacher & Bartlett; Chase Bentley – Simpson Thacher & Bartlett; John Creed – Simpson Thacher & Bartlett; Jim Cross – Simpson Thacher & Bartlett; Jamie Fell – Simpson Thacher & Bartlett; Michael Halper – Simpson Thacher & Bartlett; Matthew Hart – Simpson Thacher & Bartlett; Jasmine Hay – Simpson Thacher & Bartlett; Brad Honeycutt – Simpson Thacher & Bartlett; Edward Linden – Simpson Thacher & Bartlett; Christopher May – Simpson Thacher & Bartlett; Kathrine McLendon – Simpson Thacher & Bartlett; Erland Modesto – Simpson Thacher & Bartlett; Laurence Moss – Simpson Thacher & Bartlett; Michael Paparozzi – Simpson Thacher & Bartlett; Brian Rosenzweig – Simpson Thacher & Bartlett; William Russell – Simpson Thacher & Bartlett; Brandan Still – Simpson Thacher & Bartlett; Pasco Struhs – Simpson Thacher & Bartlett; Michael Torkin – Simpson Thacher & Bartlett; Daniel Biller – Sullivan & Cromwell;

Law Firms: Simpson Thacher & Bartlett; Sullivan & Cromwell;

Clients: Arsenal Resources;