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American Eagle Energy Plan Filed

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American Eagle Energy filed with the U.S. Bankruptcy Court Chapter 11 Plan of Liquidation and related Disclosure Statement.

According to the Disclosure Statement, “The purpose of the Plan is to provide for the distribution of the Sale Proceeds to the holders of Claims against the Debtors, and to create the Liquidation Trust to oversee an orderly liquidation and distribution of the Debtors’ remaining assets. The provisions of the Plan governing, among other things: (i) the payment of allowed fees and expenses incurred by the Creditors’ Committee Professionals; (ii) the payment of the Unsecured Creditor Payment; and (iii) the establishment of the Liquidation Trust have been fully negotiated by and among the Debtors, Ad Hoc Group, and the Committee.”

The Disclosure Statement continues, “The Plan contemplates the creation of the Liquidating Trust controlled by the Liquidating Trustee. The Ad Hoc Group will designate the Liquidating Trustee prior to the Effective Date. On the Effective Date of the Plan, the Liquidating Trust Assets will be transferred to the Liquidating Trust. The Liquidation Trust will liquidate such assets in an orderly fashion for the benefit of the Unsecured Creditors (Class 7). The Plan also provides that the holders of Allowed Administrative Claims and Allowed Priority Tax Claims will be paid in full on the Effective Date or the date that such Claims become Allowed Claims. Upon the Effective Date, existing equity in the Debtors will be cancelled. Section 4.2 of the Plan incorporates a settlement offer to the holders of Outstanding Well Lien Claims. Sections 4.3 – 4.5 of the Plan incorporate the terms of settlements that have been agreed upon by the Debtors, Indenture Trustee, and Ad Hoc Group, on the one hand, and the claimant(s) whose claims are treated under Sections 4.3 – 4.5, respectively, on the other hand.”

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