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Oil and gas producer Magnum Hunter Resources Corp and its affiliates filed for chapter 11 protection yesterday to carry out a debt-cutting plan as a prolonged slump in oil prices has depleted the company's cash, Reuters reported. The company entered into a restructuring agreement that will convert its funded debt into equity, substantially reducing its more than $1 billion in debt, according to a company statement. To fund its operations during its bankruptcy, the company's lenders agreed to provide up to $200 million in financing, which will also convert into equity when Magnum Hunter emerges from bankruptcy. Magnum Hunter ranks among the biggest energy producers to file for bankruptcy this year, joining Samson Resources Corp., Sabine Oil & Gas Corp., Quicksilver Resources Inc and Energy & Exploration Partners Inc.

Seaboard Realty, a company that owns and manages a number of commercial and residential properties in Stamford, Conn., filed for bankruptcy protection yesterday and its president stepped down after two partners in the company questioned his bookkeeping, the Stamford Advocate reported today. Unspecified “recent events” prompted two owners to question the company’s finances under now-former president John DiMenna’s leadership, and the two hired a law firm and forensic accountant, according to a statement from the company. DiMenna resigned from his managerial duties with Seaboard Realty and also from its affiliates.

Arch Coal Inc., the second-largest coal miner in the U.S., said that it has chosen to extend by 30 days a $90 million in bond interest payments that was due today, Reuters reported. The company, which ended a proposed debt swap in October that was seen as key to delaying a potential bankruptcy, said that it plans to use the grace period to continue talks with creditors to restructure its balance sheet. Arch Coal, struggling under strict regulation and plummeting coal prices, had said last month that it could follow its smaller peers into bankruptcy in the near term, even if current talks with creditors yield a restructuring agreement. Competitors such as Walter Energy Inc., Alpha Natural Resources Inc. and Patriot Coal have all filed for bankruptcy this year.

Chesapeake Energy Corp. is working with restructuring advisers at Evercore Partners Inc. to shore up its balance sheet as commodity prices extend their decline, the Wall Street Journal reported today. The Evercore bankers are advising the natural-gas producer on potential measures to reduce its $11.6 billion debt load, such as exchanging existing bonds at a discount for new securities or selling assets. The Oklahoma City company, co-founded in 1989 by famed gas explorer Aubrey McClendon, became one of the dominant U.S. natural-gas producers during the shale boom. Fueled by cheap debt, Chesapeake expanded aggressively in Ohio, Texas and other parts of the U.S., becoming the second-largest U.S. natural-gas producer behind Exxon Mobil Corp. But the tumble in natural gas prices has hurt the company, which has posted three straight quarterly losses this year. Chesapeake ended September with $1.8 billion in cash, down from $4.1 billion at the end of 2014, according to regulatory filings.

Cubic Energy Inc., the latest Texas oil company brought down by falling oil prices, filed for bankruptcy protection after reaching a deal with its lenders to hand over control of the company, MarketWatch.com reported yesterday. The Dallas-based Cubic, which drills for oil and natural gas in Texas and Louisiana, said that it has agreed to cede control of the company to Wells Fargo Energy Capital and its secured bondholders, including an affiliate of Anchorage Capital Group. The company, which listed assets of $120.7 million and debts of $114.2 million in its bankruptcy petition, filed for chapter 11 with a pre-packaged bankruptcy plan having already secured the votes to secure passage of its debt-for-equity swap. Read more.

For further analysis and insight into oil and energy company bankruptcies, be sure to pick up a copy of ABI’s When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy. 

Millennium Health LLC’s chapter 11 plan cleared a major hurdle on Friday when a bankruptcy judge brushed aside objections to the plan, which funds a $256 million settlement of fraud accusations with the Justice Department, the Wall Street Journal reported on Saturday. Judge Laurie Selber Silverstein approved the bulk of a reorganization strategy designed as a fresh start for the drug-testing company. Millennium hasn’t admitted to civil charges that it fraudulently billed taxpayers. The judge withheld her signature while pondering the form of the order she is being asked to sign. Assuming she grants confirmation at a hearing on Tuesday, lenders will take over from the existing owners, including James Slattery, who founded Millennium, and TA Associates, a private-equity firm that owns a minority stake in the company. At a hearing on Friday in the U.S. Bankruptcy Court in Wilmington, Del., Judge Silverstein cited a looming Dec. 30 deadline for Millennium to cover the settlement or face revocation of its right to bill Medicare and other government programs.

Tribune Publishing Co. says that it is working to put together an offer for Freedom Communications Inc., one that would top a bid from the existing owner of the Orange County Register publisher, the Wall Street Journal reported today. Tribune is performing due diligence that will ultimately lead to “a stalking-horse offer that Tribune Publishing is optimistic will be viewed as the highest and best offer” for Freedom, the company said in a document filed with the U.S. Bankruptcy Court in Santa Ana, Calif. The court filing, a term sheet for a bankruptcy loan, was made public as part of an objection from Tribune, which publishes the Los Angeles Times and other newspapers, to Freedom’s currently proposed bankruptcy financing. That financing, from hedge fund Silver Point Capital LP, provides $3 million to Freedom but also refinances an additional $19 million in pre-bankruptcy debt owed to Silver Point.

Energy & Exploration Partners Inc. filed for chapter 11 protection on Monday, following several other oil and gas drillers into bankruptcy, Bloomberg News reported yesterday. The company’s bankruptcy petition listed debt of $1 billion to $10 billion and assets of $500 million to $1 billion. The Fort Worth, Texas oil and gas driller’s federal bankruptcy filings convert an involuntary bankruptcy petition filed Nov. 25 by creditors Baker Hughes Oilfield Operations Inc., Cactus Pipe & Supply and Schlumberger Technology Corp. to a voluntary petition, according to court papers. In addition, to fund its operations during the restructuring process, Energy and Exploration said that it secured commitments for up to $135 million of new debtor-in-possession financing from a group of its senior lenders.

For futther analysis of oil and gas bankruptcy proceedings, be sure to pick up a copy of ABI's When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy.

Wireless venture LightSquared LP said it reached a settlement yesterday with Deere & Co. over spectrum use that will provide support for the company as it emerges from bankruptcy, Reuters reported yesterday. The agreement could potentially lead to further settlements with other GPS providers over interference between LightSquared's spectrum and GPS signals. LightSquared officially exited chapter 11 protection on Monday after the Federal Communications Commission (FCC) agreed to allow the transfer of its valuable wireless spectrum into a newly-formed company, ending one of the longest and most litigious chapter 11 cases in recent years. The company was planning to build a nationwide wireless network when the FCC proposed to suspend indefinitely its terrestrial spectrum authorizations, pushing it into bankruptcy in May of 2012 and bitter litigation with stakeholders vying for control of its valuable spectrum. Under the new deal with Deere, LightSquared will reduce out-of-band emissions and forego terrestrial use on parts of its spectrum closest to GPS.

A Delaware judge won’t let Murray Energy Corp. use a loophole to avoid cashing out creditors of Foresight Energy LP, saying the move breached an agreement to buy back $600 million in bonds, Bloomberg News reported on Saturday. Friday’s ruling comes in a lawsuit brought by a bond trustee alleging that Foresight altered Murray’s purchase from a controlling 80 percent to a minority stake of 34 percent to avoid triggering the payment under a debt agreement. Murray acquired 34 percent of the voting rights in Foresight in April as part of a $1.37 billion takeover, while maintaining a 50 percent economic interest in the company. Murray, seeking to expand its presence in low-cost mining regions such as the Illinois coal basin where Foresight operates, revised the terms after struggling to raise the required debt to fund the deal.