Davis Polk is advising an ad hoc group (the “Ad Hoc Group”) of holders of senior secured second lien notes issued by Ultra Resources, Inc. in connection with the chapter 11 restructuring of Ultra Petroleum Corp. and certain of its affiliates and subsidiaries (collectively, “Ultra Petroleum”). On May 14, 2020, Ultra Petroleum filed voluntary chapter 11 petitions in the United States Bankruptcy Court for the Southern District of Texas after entering into a restructuring support agreement (the “RSA”) with the Ad Hoc Group, lenders of its reserve-based lending facility (the “RBL Lenders”) and lenders of its first-lien term loan (the “Term Loan Lenders”).

Under the terms of the RSA and the attached proposed plan, members of the Ad Hoc Group will receive their pro rata share of 2.5% of the common stock of reorganized Ultra Petroleum (subject to dilution) and 45% of any net proceeds received by Ultra Petroleum in connection with the resolution of its pending make-whole litigation. The Term Loan Lenders will receive their pro rata share of 97.5% of the common stock of reorganized Ultra Petroleum (subject to dilution) and the right to participate in a $70 million rights offering. The RBL Lenders will have the option to receive a cash payment at 85% of their allowed claims, provided that they participate in an exit reserve-based lending facility as part of the rights offering, or alternatively will receive their pro rata share of 97.5% of the common stock of reorganized Ultra Petroleum (subject to dilution). As of the petition date, the RSA was supported by 100% of the RBL Lenders, more than 85% of the Term Loan Lenders, and more than 67% of holders of the prepetition senior secured second lien notes.

Ultra Petroleum is an independent exploration and production company focused on developing long-life natural gas reserves in the Pinedale and Jonah Fields of Wyoming’s Green River Basin. Controlling more than 117,000 gross (83,000 net) acres in and around the prolific Pinedale and Jonah Fields, Ultra Petroleum is the top natural gas producer in the State of Wyoming.

The Davis Polk restructuring team includes partner Damian S. Schaible and associates Stephen D. Piraino and Samuel Wagreich. All members of the Davis Polk team are located in the New York office. 

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