- Revised Plan Allows Company to Exit Bankruptcy Prior to Conclusion of Ongoing Litigation
- Opt-In Proposal Provides Opportunity for Cash Settlement
- Syndication Date for $500 Million Exit Facility to be Announced Shortly
SemGroup, LP announced the company today filed its Third Amended Plan of Reorganization with the U.S. Bankruptcy Court in Delaware.
The amended plan is meant to allow the company to seek confirmation of the plan and exit Chapter 11 reorganization prior to the conclusion of, and regardless of the outcome of, ongoing litigation between SemGroup's prepetition lenders and certain oil and gas producer creditors. Under the terms of the amended plan, the company is offering opt-in cash settlements to holders of certain disputed claims.
The company anticipates a supplemental disclosure hearing on September 24, 2009, and a hearing on October 26, 2009, to consider confirmation of the latest plan, putting SemGroup on track to exit bankruptcy by early November. The Third Amended Plan of Reorganization does not materially alter proposed distributions to any creditors other than those being offered the opportunity to participate in the opt-in settlements. The opt-in proposal provides the opportunity for more cash to be distributed to more creditors.
The table below outlines the recovery percentages assuming the claimant elects to participate in the Opt-In Settlements, as described in the Third Amended Plan of Reorganization. To the extent the claimant does not elect to participate in the Opt-In Settlements, the claimant's recovery may be materially different, and the claimant should refer to the Third Amended Plan of Reorganization for detail on their recovery.
| Opt-In Settlements Construct | |||||
| Recovery % | Description | ||||
| Non-Eaglwing Claims | |||||
| Non-First Purchaser 503(b)(9) | 66.0% | Represents commodity, non-first purchaser, 503b9 claims. This recovery does not apply to Alon, who received a separate settlement at the beginning of the bankruptcy proceedings. | |||
| First Purchaser 503(b)(9) | 75.0% | Represents commodity, first purchaser 503b9 claims in all states. | |||
| First Purchaser - Lien States | 30.0% | Represents first purchaser, non-503b9 claims in the following states: Kansas, Oklahoma, Texas, New Mexico, and Wyoming. | |||
| First Purchaser - Other States Claims | 0.0% | Represents first purchaser, non-503b9 claims in the following states: Louisiana, Colorado, Louisiana, Missouri, Montana, Nebraska and North Dakota. | |||
| Eaglwing Claims | |||||
| Non-First Purchaser 503(b)(9) | 66.0% | Represents commodity, non-first purchaser, 503b9 claims at Eaglwing. | |||
| First Purchaser 503(b)(9) | 50.0% | Represents commodity, first purchaser 503b9 claims in all states. | |||
| First Purchaser - Lien States | 0.0% | Represents first purchaser, non-503b9 claims in the following states: Kansas, Oklahoma, Texas, New Mexico, and Wyoming. | |||
| First Purchaser - Other States Claims | 0.0% | Represents first purchaser, non-503b9 claims in the following states: Colorado, Louisiana, Missouri, Montana, Nebraska and North Dakota. | |||
Note:Participation in the Opt-In Settlements shall be viewed as full satisfaction of all claims, including any unsecured claims, as defined in the Third Amended Plan of Reorganization.
“These amendments are designed to enable SemGroup to seek confirmation of the plan, exit bankruptcy protection, and begin making distributions to creditors without having to wait for the potentially lengthy appeals process to play out,” said Terry Ronan, the company’s president and chief executive. “We look forward to concluding our successful restructuring and exiting Chapter 11 this fall as a leader in all of the markets we serve.”
The ongoing litigation includes the pending appeals filed by certain oil producers in the United States Court of Appeals for the Third Circuit.
Additionally, the company anticipates announcing the syndication date for its $500 million Exit Financing Facility shortly.
SemGroup, LP and certain subsidiaries filed voluntary petitions for Chapter 11 under the U.S. Bankruptcy Code on July 22, 2008.
About SemGroup
Based in Tulsa, Okla., SemGroup, L.P., is a midstream service company providing the energy industry means to move products from the wellhead to the wholesale marketplace. SemGroup provides diversified services for end users and consumers of crude oil, natural gas, natural gas liquids, refined products and asphalt. Services include purchasing, selling, processing, transporting, terminaling and storing energy.
Contacts:
Sitrick And Company
Tom Becker, 212-573-6100
tom_becker@sitrick.com
