Source: Company Press Release
 
Stallion Oilfield Services Ltd. (“Stallion” or the “Company”), a leading oilfield services company that provides comprehensive wellsite support and production and logistics services to oil and natural gas exploration and production companies, today announced that it has received the requisite support of its lenders and equity holders for the balance sheet restructuring agreement that it announced on October 7, 2009 and that it has filed voluntary petitions for chapter 11 relief to move forward to implement its prearranged plan and obtain the necessary court approvals.
 
On October 7, 2009, Stallion announced that it had reached an agreement in principle with a working group of secured lenders, a sub-committee of debtholders, and its key equity holders to implement a restructuring that would eliminate approximately $515 million of the Company’s unsecured debt as well as $26 million of accrued interest.
 
As of October 19, 2009, the Company has more than $80 million of cash on hand to support both the restructuring and operations. Stallion indicated that it does not anticipate any changes to the overall business or its ability to meet customer needs as a result of this action. Mr. Craig M. Johnson, Stallion’s President and Chief Executive Officer, said, “Stallion is committed to ensuring a seamless restructuring process for all parties involved, and will emerge as a leaner, stronger company poised to capitalize on expected recoveries in the oil and natural gas industry.”
 
The restructuring agreement includes a lock-up agreement with holders of more than 90% in principal amount of its secured obligations and more than 74% in principal amount of its unsecured bridge lenders and more than 88% in principal amount of its unsecured noteholders as well as more than 68% of equity holders supporting the restructuring. The terms of the restructuring agreement provide that (a) the Company’s secured lenders would receive approximately $25 million in principal payments permanently reducing the Company’s obligations outstanding under the Company’s secured credit agreement, (b) approximately $259 million in obligations outstanding under the Company’s unsecured bridge loan agreement and approximately $284 million in obligations outstanding on account of the 9.75% unsecured notes due February 1, 2015 would be converted on a pro rata basis for 98% of the common equity in the reorganized Stallion, and (c) the Company’s existing equity holders would receive 2% of the common equity and warrants to purchase 1% of the common equity in reorganized Stallion.
 
The full implementation of the agreement is dependent upon a number of factors, including the filing of a plan of reorganization, the approval of a disclosure statement and confirmation and consummation of the plan of reorganization in accordance with the provisions of the Bankruptcy Code.
 
The Company’s filing includes key initiatives to ensure there is little or no impact on Stallion’s operations and its employees, customers, vendors and suppliers. For example, Stallion is seeking court authority to continue payment of employee wages and benefits and vendors for goods and services delivered both before and after the filing in the normal course.
 
Stallion filed its chapter 11 petitions in the United States Bankruptcy Court for the District of Delaware. Customers, vendors, suppliers and others seeking more information about Stallion’s restructuring may contact Stallion at 1-888-290-6621. Parties can access court papers from the Court’s electronic records system at http://ecf.deb.uscourts.gov or www.chapter11.epiqsystems.com/stallion.
 
The following affiliates of Stallion were included in the Company’s chapter 11 filings: Stallion Oilfield Services Ltd.; Central Industries, Inc.; Salty’s Disposal Wells, LP; Salty’s Manufacturing, Ltd.; Stallion Acquisition, LLC; Stallion Heavy Haulers, LP; Stallion Interests, LLC; Stallion Offshore Quarters, Inc.; Stallion Oilfield Construction, LLC; Stallion Oilfield Finance Corp.; Stallion Oilfield Holdings GP, LLC; Stallion Oilfield Holdings, Ltd.; Stallion Oilfield Services, Inc.; Stallion Production Services, LP; Stallion Production, LLC; Stallion Rockies Ltd.; Stallion Solids Control, Inc.; and Stallion Stables, LLC.
 
Kirkland & Ellis LLP is serving as Stallion’s chapter 11 counsel and Miller Buckfire & Co., LLC, and AP Services, LLC are serving as its financial advisors.