Nine Energy Service, Inc. 8-K

What Happened

• Nine Energy Service, Inc. (NINEQ) confirmed its Chapter 11 Plan (Bankruptcy Court order on March 4, 2026) and effected the Plan on the Plan Effective Date (March 5, 2026). Under the Plan the company (i) converted its debtor‑in‑possession financing into a new Exit ABL Facility, (ii) cancelled prior secured notes and prepetition debt arrangements, and (iii) cancelled existing common stock and issued new equity to former senior secured noteholders.
• The company entered into an Exit Loan and Security Agreement providing a first‑priority, senior secured asset‑based revolving credit facility with $135.0 million in revolving commitments (the “Exit ABL Facility”), replacing the prior $125.0 million DIP ABL Facility. The Exit ABL Facility matures three years after the Plan Effective Date.

Key Details

• Exit ABL Facility: $135.0M maximum revolver (up to $5.0M of which may be used for letters of credit); borrowings limited by a borrowing base tied to eligible accounts, inventory, machinery & equipment and optional real property pledges. Real Property/M&E availability cap = $30.0M (amortizing).
• Pricing & covenants: Interest = term SOFR (1‑month) subject to a 1.50% floor + margin of 3.50%–4.00% (plus a 0.50% premium for loans using certain sub‑availabilities). Financial covenants include minimum excess availability of $5.0M and a 1.10x fixed charge coverage ratio when excess availability falls below specified thresholds.
• Capital structure and equity: Old Common Stock (43,310,777 shares outstanding pre‑Plan) was cancelled and approximately 13,950,000 shares of New Common Stock were issued to former Senior Secured Noteholders, who now hold 100% of the outstanding New Common Stock.
• Governance and corporate charter: Board turnover occurred under the Plan; several directors resigned and new/re‑appointed directors include Patrick J. Bartels, Sandy Esslemont, Ann G. Fox, Jerome (Joey) D. Hall, J. Carney Hawks and Darryl K. Willis (one additional director to be appointed). The company adopted a new Certificate of Incorporation and Bylaws (authorized shares reduced to 85M: 70M common, 15M preferred; board declassified; lower vote thresholds to remove directors).

Why It Matters

• The filing documents a balance‑sheet restructuring: secured note claims were cancelled and converted into equity, creditors (former noteholders) now control the company, and prior equity holders were wiped out. That is a fundamental change to ownership and voting control.
• The $135M Exit ABL Facility restores a committed borrowing base and liquidity source for working capital and general corporate needs, but borrowing is subject to borrowing‑base limits and financial covenants that could restrict cash flow flexibility if availability declines.
• Governance and charter changes (declassified board, reduced removal thresholds, indemnification) alter shareholder rights and board election dynamics going forward. Retail investors should note the ownership shift and new capital structure when assessing equity value and voting prospects.