Optim Energy Chapter 11 plan of liquidation now effective

By Mark Reccek

Bethlehem, Pa., Oct. 16 – Optim Energy LLC's Chapter 11 plan of liquidation became effective Oct. 15, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

The plan was confirmed on Oct. 14.

Under the plan, administrative and professional claims will be released.

As previously reported, the company received court approval of a plan support agreement designed to implement an unopposed plan of liquidation for Optim’s other debtors, resolve Blackstone’s appeal of the July 24 order confirming Optim Energy’s plan and resolve various claims brought by Blackstone.

The Blackstone parties include Black Walnut Mining LLC, Lonestar Generation LLC, Major Oak Power LLC, The Blackstone Group LP and Walnut Creek Mining Co.

Blackstone, the Optim debtors and the Optim pre-bankruptcy secured lenders and debtor-in-possession financing lender reached a global settlement, the terms of which were incorporated in the plan support agreement.

Under the plan agreement, Blackstone will receive a $3.12 million cash payment in full satisfaction of a 503(b)(9) claim and a $3.93 million general unsecured claim for which it will receive a total cash payment of $1.48 million in full satisfaction of its general unsecured claims.

Blackstone’s $190 million rejection damages claim will be discharged under the plan with no recovery.

Holders of Optim Energy pre-bankruptcy secured claims will receive a share of distributable cash, holders of Optim Energy general unsecured claims and convenience class claims will receive a share of $10,000, interest holders will receive no distribution and holders of Twin Oaks debtor general unsecured claims will receive a share of $80,000 if they vote to accept the subplan for that debtor or no distribution if they vote to reject it.

A liquidation trust will be created under the plan.

Optim, a Silver Spring, Md.-based power plant owner, filed for bankruptcy on Feb. 12, 2014. The Chapter 11 case number is 14-10262.

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