Davis Polk is advising an ad hoc group of secured lenders (the “Secured Lender Group”) in connection with the restructuring of Hornbeck Offshore Services, Inc. and certain of its subsidiaries (“Hornbeck”). On May 13, 2020, pursuant to a Restructuring Support Agreement with the Secured Lender Group, which holds approximately 83% of Hornbeck’s secured debt, and a group of holders of approximately 79% of Hornbeck’s unsecured notes (the “Noteholder Group”), Hornbeck commenced a solicitation of votes on a prepackaged chapter 11 plan of reorganization (the “Plan”) and launched a $100 million equity rights offering to be consummated at the same time. Also on May 13, 2020, certain members of the Secured Lender Group and the Noteholder Group signed commitment papers to backstop the equity rights offering and to provide Hornbeck with a $75 million debtor-in-possession financing facility in order to bridge the company through the prepackaged bankruptcy cases. The DIP facility will be used to refinance the company’s existing ABL credit facility and provide incremental liquidity to fund the chapter 11 process. Under the Plan, Hornbeck’s first-lien term lenders will exchange their debt for new debt and equity issued by the reorganized company and Hornbeck’s second-lien lenders and unsecured noteholders will exchange their debt for equity and warrants issued by the reorganized company. Hornbeck’s prepetition first- and second-lien lenders and unsecured noteholders will have the opportunity to participate in the equity rights offering. Hornbeck is expected to file the chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas on or after May 15, 2020, and to seek a hearing on confirmation of the Plan on or around June 19, 2020.

Hornbeck Offshore Services, Inc. is a leading provider of technologically advanced, new generation offshore service vessels primarily in the Gulf of Mexico and Latin America.

The Davis Polk restructuring team includes partners Damian S. Schaible and Darren S. Klein and associates Stephanie Massman and Zachary Levine. The finance team includes partner Kenneth J. Steinberg and associate Scott M. Herrig. The corporate team includes partner Harold Birnbaum and associate Doug Howell. Partner Adam Kaminsky is providing executive compensation advice. Members of the Davis Polk team are based in the New York and Washington DC offices.

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