Lilis Energy disclosure statement approved; plan hearing Nov. 17

By Sarah Lizee

Olympia, Wash., Oct. 15 – Lilis Energy, Inc.’s disclosure statement for its first amended joint Chapter 11 plan of liquidation was approved on Thursday in the U.S. Bankruptcy Court for the Southern District of Texas.

A hearing on confirmation of the plan is scheduled for Nov. 17.

As previously reported, the debtors are pursuing a process to sell substantially all of their assets, which may include one or more sale transactions that will close on or before the effective date.

Under the plan, holders of senior priority lien claims will receive payment in full in cash, the collateral securing their claims or other treatment that renders their claims unimpaired.

Holders of other priority claims will receive payment in full in cash.

Holders of non-affiliated RBL claims will receive, in the event that the assets aren’t sold under a credit bid, their pro rata share of the net sale proceeds, the series A liquidation trust interests and all distributions from the liquidation trust assets, other than distributions from the unsecured claim pool and any residual interest in the claims reserve or the professional claims escrow account, in each case, until the non-affiliated RBL claims are paid in full.

In the event the assets are sold under a credit bid, holders of non-affiliated RBL claims will receive their pro rata share of the series A liquidation trust interests and all distributions from the liquidation trust assets, other than distributions from the unsecured claim pool and any residual interest in the claims reserve or the professional claims escrow account, in each case, until the non-affiliated RBL claims are paid in full.

Holders of affiliated RBL claims will receive, regardless of whether or not the assets are sold under a credit bid, their pro rata share of the net sale proceeds remaining after the payment in cash in full of all non-affiliated RBL claims, if any, the series B liquidation trust interests and, only after the payment in cash in full of all non-affiliated RBL claims, all distributions from the liquidation trust assets, other than distributions from the unsecured claim pool, until the affiliated RBL claims are paid in full and, only after the payment in full of all non-affiliated RBL claims, any residual interest in the claims reserve, RBL secured parties A/R, or the professional claims escrow account.

Holders of unsecured claims will receive their pro rata share of the series C liquidation trust interests, which includes the exclusive right to receive a recovery from the unsecured claim pool.

Intercompany claims, section 510(b) claims, existing preferred equity interests, existing common equity interests and intercompany interests will be cancelled with no distributions.

Lilis is a Fort Worth-based independent oil and gas exploration and production company that operates in the Permian’s Delaware Basin. The company filed bankruptcy on June 28 under Chapter 11 case number 20-33274.

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