TPC Group Commences Transformational Deleveraging and Recapitalization

Comprehensive pre-arranged financial restructuring will strengthen the Company’s balance sheet and position it for future growth opportunities

Houston, TX. (June 1, 2022) –– TPC Group Inc. (“the Company”), a global leader in providing a diverse range of quality products to chemical and petroleum-based companies worldwide, announced today that it has taken definitive steps to strengthen its balance sheet and position the Company to be a stronger, more competitive business. The Company and certain of its subsidiaries have voluntarily filed for Chapter 11 protection in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Company intends to use the proceedings to implement a financial restructuring with the support of a majority of its secured noteholders that will deleverage and recapitalize the Company’s balance sheet and definitively address other legacy liabilities. The Company expects to continue its operations uninterrupted throughout the process.

In connection with the Chapter 11 filings, the Company and certain of its affiliates entered into a Restructuring Support Agreement (as amended, the “RSA”) with an ad hoc group of holders of approximately 88% of the Company’s $205.5 million outstanding 10.875% secured notes due 2024 and approximately 78% of the Company’s $930 million outstanding 10.5% secured notes due 2024 (the “Supporting Noteholders”) and the Company’s equity sponsors (the “Sponsors”), among others. The RSA locks in the support of the Supporting Noteholders and Sponsors and establishes the framework for the Company’s restructuring, which, on emergence, is expected to resolve all tort liabilities arising from the Port Neches facility incident and eliminate from the Company’s balance sheet over $950 million of the Company’s approximately $1.3 billion of secured funded debt. The transactions contemplated by the RSA, once consummated, will result in the Company emerging from bankruptcy with a significantly enhanced liquidity profile by providing for capital infusions in the form of:

$450 million in connection with two rights offerings and $350 million in exit notes, all of which will be backstopped by certain of the Supporting Noteholders, subject to the terms and conditions set forth in the RSA;
a $323 million delayed draw debtor-in-possession financing facility provided by certain of the Supporting Noteholders, which includes up to $85 million of new money to support the operations of the Company and help fund the restructuring process, subject to customary conditions; and
a $200 million asset-based revolving debtor-in-possession facility provided by Eclipse Business Capital LLC and its affiliates, with the Company’s option to convert such facility into an exit asset-based revolving facility, subject to customary conditions.

“Over the past several years, TPC Group has positioned our business as a critical partner and player in the petrochemical industry. However, a series of unprecedented events including the COVID-19 pandemic, supply chain issues, commodity price increases, higher energy costs and operational challenges resulting from 2021 Winter Storm Uri, and the explosion at our Port Neches plant in November of 2019 have caused financial strain for the Company,” said Chairman, President and Chief Executive Officer of TPC Group, Edward J. Dineen. “We have undertaken many efforts to address the impacts of these events and preserve liquidity, which has given us the necessary time to consider the best path forward for our business and our stakeholders. We are confident that through this process, we will bolster our liquidity, substantially improve our debt position, and definitively resolve the liabilities associated with the Port Neches facility incident.”

For more than 75 years, the Company has operated as the largest independent processor of crude C4 and as a leader in North America across all of its product lines. Furthermore, the Company provides critical infrastructure and logistics services to petrochemical operators along the Gulf Coast. By establishing a suitable underlying financial structure, the chapter 11 process will allow the Company to continue to expand upon its rich history and resume the path to sustained, profitable growth.

The Company has filed certain “First-Day” motions with the Bankruptcy Court so that it can seamlessly transition into chapter 11 without disruption to its ordinary course operations, thereby enabling the Company to fulfill its go-forward commitments to its stakeholders, and pay its employees and certain vendors. The Company is committed to continuing its operations in a safe and environmentally responsible manner, while fulfilling its commitments to its partners in the petrochemical industry, as well as to its employees and surrounding communities.

For more information about the Company’s Chapter 11 case, please visit https://cases.ra.kroll.com/TPCGroup. A copy of the RSA and related cleansing materials can be found on the Company’s secure investor portal for current investors who have registered and filed in the Company’s Chapter 11 case.

The Company is advised in this process by Baker Botts L.L.P., Simpson Thacher & Bartlett LLP, Moelis & Company LLC, and FTI Consulting. The Supporting Noteholders are advised by Paul Hastings LLP and Evercore. Eclipse Business Capital LLC is advised by Goldberg Kohn Ltd.

About TPC Group

TPC Group, headquartered in Houston, is a leading producer of value-added products derived from petrochemical raw materials such as C4 hydrocarbons, and provider of critical infrastructure and logistics services along the Gulf Coast. The Company sells its products into a wide range of performance, specialty and intermediate markets, including synthetic rubber, fuels, lubricant additives, plastics and surfactants. With an operating history of more than 75 years, TPC Group has a manufacturing facility in the industrial corridor adjacent to the Houston Ship Channel and operates product terminals in Port Neches, Texas and Lake Charles, Louisiana.

No Solicitation or Offer

Any new securities to be issued pursuant to the restructuring transactions may not be registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws but may be issued pursuant to an exemption from such registration provided in the U.S. bankruptcy code or the Securities Act. Such new securities may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and any applicable state securities laws. This press release does not constitute an offer to sell or buy, nor the solicitation of an offer to sell or buy, any securities referred to herein, nor is this press release a solicitation of consents to or votes to accept any chapter 11 plan. Any solicitation or offer will only be made pursuant to a confidential offering memorandum and disclosure statement and only to such persons and in such jurisdictions as is permitted under applicable law.

Contact:

Sara Cronin

Media Relations
713.475.5243

Andrew Grygiel

Investor Relations

713.840.2045