Forbes Energy Service’s Joint Prepackaged Chapter 11 Plan of Reorganization became effective, and the Company emerged from Chapter 11 protection. The U.S. Bankruptcy Court confirmed the Plan on March 29, 2017.
BankruptcyData’s detailed Plan Summary notes, “Upon emergence from chapter 11, the Reorganized Debtors expect to have outstanding debt primarily consisting of obligations under a contemplated $50 million term loan Exit Facility. The Exit Facility will have a four-year maturity date and will accrue interest at the rate of 5.00% per annum, which will be payable in cash, plus an additional 7.00% per annum, which will be payable in cash or in-kind at the election of the Reorganized Parent, provided, that the latter rate of interest will increase by 2% per annum every 12 months. Accordingly, the Reorganized Debtors will have a significantly deleveraged and improved balance sheet and a more appropriate capital structure.”
BankruptcyData’s Plan Summary continues, “The Liquidation Analysis for Reorganized Forbes Energy estimates Gross Liquidation Proceeds Available for Distribution to be between $92.7 million and $119.1 million, representing a 63% – 71% discount to book value. The recovery rate to the Class 4 – Senior Unsecured Note Claims and Class 5 – General Unsecured Claims is estimated to be between 16% and 26%.”
This oil and gas services’ provider filed for Chapter 11 protection on January 22, 2017, listing $413 million in pre-petition assets.
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