Denbury Resources Commences Next Step to Implement Pre-Packaged Plan to Strengthen Its Balance Sheet and Reduce Debt

Denbury Resources Inc. (NYSE: DNR) (“Denbury” or the “Company”) today announced it has taken the next step to implement its “pre-packaged” plan to eliminate the Company’s $2.1 billion of bond debt, consistent with the terms of its previously announced Restructuring Support Agreement (the "RSA").

As announced on July 29, 2020, Denbury entered into an RSA with funded debtholders holding 100% of the Company’s revolving credit facility loans, approximately 67.2% of its second lien notes and approximately 70.8% of its convertible notes.  As contemplated by the RSA, Denbury and its subsidiaries have voluntarily filed petitions for reorganization under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas (the “Court”).  Denbury expects to continue normal course operations throughout the Court-supervised process.

Pursuant to their commitment letter, the Company’s existing lenders are providing a debtor-in-possession (“DIP”) revolving loan that will “roll” into an exit facility with up to $615 million in availability.  Upon Court approval, this new financing and the cash generated from Denbury’s ongoing operations are expected to be sufficient to support the business during the Court-supervised process.

Chris Kendall, Denbury’s President and CEO, commented, “We are pleased to be moving forward with our pre-packaged plan and we are grateful to have the support of our lenders and bondholder groups, which will enable us to complete our financial restructuring on an expedited basis.  Against a backdrop of unprecedented industry challenges, we expect this process to significantly enhance Denbury’s financial flexibility and position our company for long-term success.  In recent days, we have spoken with many of our partners and stakeholders, and we appreciate their confidence in our ongoing business.

“Throughout this process, we are committed to continuing to perform at a high level, remaining focused on safe, responsible and efficient operations.  I again want to thank our dedicated team for their hard work and unwavering dedication to the Company’s success.  We look forward to emerging a financially stronger company, and we are excited about building on the multiple advantages of our unique CO2 EOR focused strategy for many years to come.”

In connection with the Chapter 11 filing, Denbury has filed a number of customary motions with the Court seeking authorization to support its operations while this process is ongoing, including authority to continue to pay employee wages and benefits in the ordinary course, honor customer commitments and make payments to lessors and royalty owners in the ordinary course of business.  The Company also expects to pay vendors in full for goods and services provided on or after the Chapter 11 filing date.  Under terms of the pre-packaged plan, which is subject to Court approval, general unsecured pre-petition claims will also be paid in full in the ordinary course.

Additional information is available at www.denburyrestructuring.com or by calling Denbury’s Restructuring Hotline, at 855-917-3570 (toll-free in the U.S.) or 503-520-4467 (for calls originating outside the U.S.).  Court documents and additional information about the Court-supervised process are available on a separate website administered by Denbury’s claims agent, Epiq, at https://dm.epiq11.com/Denbury.

Kirkland & Ellis LLP is acting as legal counsel to Denbury, Evercore Inc. is acting as financial advisor and Alvarez & Marsal is serving as restructuring advisor.