Chesapeake Energy obtains approval of 'first-day' motions that will keep the company operating, officials say
'First-day' relief aids Chesapeake with debt
Chesapeake Energy announced late Monday the U.S. Bankruptcy Court for the Southern District of Texas approved company motions seeking a variety of “first-day” relief the company requested as part of its filing.
Motions the court granted gave the company continued authority to pay owner royalties, employee wages and benefits, and to continue to pay certain vendors and suppliers for goods and services provided as the company continues its operations.
The court also approved, on an interim basis, the company's $925 million in debtor-in-possession ("DIP") financing, which Chesapeake secured from certain lenders under its revolving credit facility.
Officials said Chesapeake will use that cash to fund operations while the court oversees its reorganization proceedings.
Chesapeake voluntarily sought Chapter 11 protection seeking to strengthen its balance sheet and restructure its legacy contractual obligations to achieve a more sustainable capital structure, company officials have said.