Stone Energy and its domestic subsidiaries have filed voluntary petitions under chapter 11 of title 11 of the US code, the bankruptcy code, in the US Bankruptcy Court for the Southern District of Texas to pursue a pre-packaged plan of reorganization.
On 14 December Stone agreed to an amended and restated restructuring support plan that gained some 79.7% approval from holders of the company’s outstanding notes, and 100% of its bank loans.
Under the pre-packaged deal, noteholders will receive their pro rata share of US$100 million in cash, 96% of the common stock in reorganized Stone, and$225 million of new 7.5% second lien notes due 2022.
Existing common stockholders of Stone will receive their pro rata share of 4% of the common stock in reorganized Stone and warrants for up to 10% of the post-petition equity exercisable upon the company reaching certain benchmarks pursuant to the terms of the proposed new warrants.
Banks signing to the agreement will receive their respective pro rata share of commitments and obligations under an amended credit agreement, as well as their respective share of the company's unrestricted cash, as of the effective date of the plan, in excess of
Banks not signing the deal will have the option to receive either the same treatment as the banks signing the deal, or their respective pro rata share of new senior secured term loans plus collateral for their respective pro rata share of issued but undrawn letters of credit.
All claims of creditors with unsecured claims other than claims by the noteholders, including vendors, shall be unaltered and will be paid in full in the ordinary course of business to the extent such claims are undisputed. Stone estimates that such unsecured claims are in the range of approximately
Assuming implementation of the plan, Stone expects to eliminate approximately
Subject to the approval of the bankruptcy court, the plan is expected to be completed in approximately 90 days.
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