Optim Energy secures court approval to enter plan support agreement

By Caroline Salls

Pittsburgh, Aug. 18 – Optim Energy, LLC 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, according to an order filed Tuesday with the U.S. Bankruptcy Court for the District of Delaware.

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

As previously reported, the company said Blackstone, the Optim debtors and the Optim pre-bankruptcy secured lenders and debtor-in-possession financing lender have reached a global settlement, the terms of which are incorporated in the plan support agreement.

Under the plan support 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.

In addition, Blackstone’s appeals will be held in abeyance pending confirmation and the effective date of Optim Energy’s third amended plan and the new plan based on the support agreement. Once the plan takes effect, the appeals will be dismissed.

According to the motion, treatment of the other Optim creditors and equityholders will be substantially similar to the company’s plan of reorganization related to the liquidating debtors, except that Optim Generation will be added as a merging debtor.

Specifically, 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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