Pacific Drilling Commences Voluntary Chapter 11 Proceedings; Restructuring Support Agreement to Eliminate All $1.1 Billion of Bond Debt

Pacific Drilling S.A. (NYSE: PACD) announced today that it and certain of its domestic and international subsidiaries have filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas and have entered into a restructuring support agreement with an ad hoc group of the largest holders of its outstanding bond debt. This consensual financial restructuring transaction will eliminate the Company’s approximately $1.1 billion in principal amount of outstanding bond debt through the cancellation and exchange of debt for new equity in the reorganized Company.

The Company also announced today that it has repaid its $50 million first lien superpriority revolving credit agreement with Angelo, Gordon Energy Servicer, LLC, as administrative agent and the lenders party thereto.

With approximately $120 million of cash and cash equivalents as of October 30, 2020, and seven of the most advanced high-specification drillships in the world, Pacific Drilling intends to continue its world-wide operations as usual, deliver services for existing and prospective clients and, subject to court approval, pay all obligations incurred during the Chapter 11 case in full. The Company expects to emerge by year-end with access to new capital in the form of an $80 million exit facility and with approximately $100 million of cash and cash equivalents on the balance sheet.

Since the beginning of 2020, the global health crisis caused by COVID-19 and the resulting oil supply and demand imbalance have caused significant disruption in world economies and markets, including a substantial decline in the price of oil. The impact of these market conditions on Pacific Drilling’s business has been direct and significantly negative, rendering our current capital structure unsustainable over the long-term.

Bernie Wolford, Chief Executive Officer, stated, “After spending several months evaluating options for addressing our long-term financial needs in light of challenging market and operational conditions, we are pleased to reach agreement with an ad hoc group of our noteholders that paves the way for an expeditious Chapter 11 restructuring process. This restructuring is intended to enhance our financial flexibility by eliminating our entire prepetition debt and cash interest burden. We expect to emerge from this process in a stronger position to compete in today’s challenging, lower-commodity-price environment. I appreciate the ongoing support of our employees, clients and vendors as we complete this accelerated restructuring process. We remain committed to delivering the safest, most efficient and reliable deepwater drilling services in the industry.

Additional information regarding the restructuring and Chapter 11 proceedings can be found (i) on our website at www.pacificdrilling.com/restructuring, (ii) on a website administered by our claims agent, Prime Clerk, at http://cases.primeclerk.com/PacificDrilling2020, or (iii) via our dedicated restructuring information line at: +1 877-930-4314 (toll free) or +1 347-897-4073 (international).

Advisors

Greenhill & Co. is acting as financial advisor, Latham & Watkins LLP and Jones Walker LLP are serving as legal counsel, and AlixPartners is acting as restructuring advisor to Pacific Drilling in connection with the restructuring. Houlihan Lokey is acting as financial advisor and Akin Gump Strauss Hauer & Feld LLP is acting as legal advisor to the noteholders.

About Pacific Drilling

With our best-in-class drillships and highly experienced team, Pacific Drilling is committed to exceeding our customers’ expectations by delivering the safest, most efficient and reliable deepwater drilling services in the industry. Pacific Drilling’s fleet of seven drillships represents one of the youngest and most technologically advanced fleets in the world. For more information about Pacific Drilling, including our current Fleet Status, please visit our website at www.pacificdrilling.com.

Contacts

Investor Contact:
James Harris
Pacific Drilling S.A.
+713 334 6662
Investor@pacificdrilling.com

Media Contact:

Amy L. Roddy
Pacific Drilling S.A.
+713 334 6662
Media@pacificdrilling.com

Contacts

Investor Contact:

James Harris
Pacific Drilling S.A.
+713 334 6662
Investor@pacificdrilling.com

Media Contact:

Amy L. Roddy
Pacific Drilling S.A.
+713 334 6662
Media@pacificdrilling.com