Lonestar Resources US Inc. Announces Restructuring Support Agreement

Lonestar Resources US Inc. (the “Company” or “Lonestar”) (NASDAQ: LONE) today announced that it and certain of its direct and indirect wholly-owned domestic subsidiaries (collectively with the Company, the “Debtors”) have entered into a Restructuring Support Agreement (the “Support Agreement”) with its largest stakeholders that will eliminate approximately $390 million in aggregate debt obligations and preferred equity interests.

Under the terms of the Support Agreement, approximately $250 million of the Company’s 11.250% Senior Notes due 2023 (the “Notes”) will be converted to equity and accrued interest thereon will be extinguished. In addition, lenders under the Company’s revolving credit facility who agree to accept the Plan (as defined below) will, among other things, receive their pro rata share of warrants (the “New Warrants”) to purchase up to 10% of the new equity interests in the Company (subject to dilution only by the issuance of new equity interests under a management incentive plan (“MIP Equity”)), revolving loans under the exit revolving credit facility, and term loans under the second-out exit term facility. Holders of preferred equity interests in the Company will receive their pro rata share of 3% of the new equity interests in the Company (subject to dilution by the MIP Equity and the New Warrants) and holders of existing Class A Common Stock in the Company will receive their pro rata share of 1% of the new equity interests in the Company (subject to dilution by the MIP Equity and New Warrants).

Under the terms of the Support Agreement, the Debtors would effectuate the proposed transactions through a prepackaged plan of reorganization (the “Plan”) under Chapter 11 of the U.S. Bankruptcy Code (“Chapter 11”). The Company has already obtained support for the proposed transactions from lenders holding 100 percent of the aggregate principal amount outstanding under its revolving credit facility, noteholders holding approximately 67.1 percent of the aggregate principal amount outstanding under its Notes, and holders of 100 percent of its preferred equity interests.

The Company is confident, based on the Support Agreement, that it will be able to meet its financial commitments and otherwise continue to operate its business as usual throughout the restructuring period. The Company anticipates funding the Cases and continuing to operate the business with cash-on-hand and certain proceeds from the consensual termination of the Debtors’ existing hedging arrangements with certain lenders under its revolving credit facility. The Support Agreement contemplates that the Company will continue operating its business without disruption to its customers, vendors, partners or employees. In addition, the Support Agreement contemplates that unsecured trade creditors will be paid in full under the Plan.

“We have carefully considered our options in the unprecedented environment faced by the energy industry and concluded that a consensual restructuring is in the best interest of the Company. In combination with our efforts to meaningfully reduce our capital and operating costs, the significant reduction in leverage that this transaction will afford the Company will position Lonestar to be highly competitive going forward,” said Frank D. Bracken III, Chief Executive Officer of the Company.

The Company is represented in this matter by Latham & Watkins LLP, Hunton Andrews Kurth LLP, Intrepid Partners LLC, Rothschild & Co US Inc. and AlixPartners, LLP.

About Lonestar

Lonestar is an independent energy company, focused on the development, production and acquisition of unconventional oil, natural gas liquids and natural gas properties in the Eagle Ford Shale in Texas.