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Intervention Energy noteholder, unitholder EIG eyes case dismissal
By Caroline Salls
Pittsburgh, May 24 – Intervention Energy Holdings, LLC secured noteholder and common unitholder EIG Energy Fund XV-A, LP asked the U.S. Bankruptcy Court for the District of Delaware to dismiss Intervention’s Chapter 11 case, according to a motion filed Tuesday.
“The court should dismiss these Chapter 11 cases because Intervention filed them without the proper authority,” EIG said in the motion.
Specifically, EIG said Intervention entered into a nine-month forbearance agreement with EIG before it filed for bankruptcy in exchange for allowing EIG to become a member of the holding company, “with a consent right over its Chapter 11 filing.”
“At the end of the nine-month period, Holdings breached its LLC agreement by commencing these Chapter 11 cases without obtaining the requisite EIG consent,” the motion said.
“Even setting aside Intervention’s lack of corporate authority, these Chapter 11 cases serve no legitimate reorganization objective under Chapter 11 and will not benefit any class of creditors.”
EIG said an out-of-court process “that has been in the works for months” would have left Intervention’s general unsecured creditors unimpaired and deleveraged Intervention’s balance sheet to enable it to continue as a going concern.
EIG said its funds are the largest creditors at both Intervention entities by a wide margin, and “it would make no sense for the EIG funds to support a plan of reorganization in these Chapter 11 cases that provides them with less than either a full recovery on their respective loans or the collateral securing their respective promissory notes.”
Based in Minot, N.D., Intervention Energy is a non-operating oil and gas exploration and production company. The company filed bankruptcy on May 20 under Chapter 11 case number 16-11247.
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