On April 14, 2016, Energy XXI announced that it reached an agreement with certain of its senior secured noteholders on the terms of a balance sheet restructuring plan that is expected to strengthen the Company's financial position by reducing long-term debt and enhancing financial flexibility. In order to implement the terms of the agreement, Energy XXI commenced cases under Chapter 11 of the Bankruptcy Code for the Southern District of Texas, Houston Division.
As part of the reorganization process, Energy XXI will be required to periodically disclose certain financial results. Energy XXI will not issue earnings news releases or hold quarterly conference calls during the reorganization proceedings. Energy XXI plans to continue to file quarterly and annual reports with the Securities and Exchange Commission.
Court filings and other information related to the court-supervised proceedings are available at a website administered by the Company's claims agent, Epiq Systems, at http://dm.epiq11.com/EnergyXXI
While the Company moves through the court-supervised process, Energy XXI common stock may continue be traded in the Pink Sheets. There can be no assurance, however, that it will be, or will continue to be, traded.
Energy XXI's agreement with certain of its senior secured noteholders provides that, upon the Company's emergence from Chapter 11, no distribution is expected on account of Energy XXI's existing stock, and the senior secured noteholders will receive 100% of the new stock in the reorganized Company, subject to dilution on account of a management incentive plan. Any recovery to existing stockholders will be determined in connection with the Company's plan of reorganization upon emergence from Chapter 11; however, the Restructuring Support Agreement provides that no distribution is expected on account of the existing equity interests in Energy XXI. We expect that existing Energy XXI stockholders will receive no recovery at the end of the restructuring process.