Nine Point Energy files Chapter 11 plan; statement hearing June 28

By Sarah Lizee

Olympia, Wash., May 25 – Nine Point Energy Holdings, Inc. filed a Chapter 11 plan of liquidation and related disclosure statement Monday with the U.S. Bankruptcy Court for the District of Delaware.

A hearing on approval of the disclosure statement is scheduled for June 28.

The debtors plan to complete the sale of substantially all of their assets as soon as possible.

The company entered into a stalking horse agreement with Meadowlark Resources LLC, an entity designated by AB Private Credit Investors, which is the company’s pre-petition agent and debtor-in-possession lender.

As previously reported, the company’s court-approved bid procedures provide for a bid deadline of June 11, an auction in June 15, and a sale hearing on June 17.

General administrative claims and priority tax claims will be paid in full from a wind-down reserve.

Professional fee claims will be paid in full from a professional fee escrow reserve. To the extent there is not enough in the reserve to pay these claims in full, the remaining amounts will be paid from any source, including the wind-down reserve.

In the event that Meadowlark is the buyer of the company’s assets, DIP claims will be deemed satisfied when the sale is completed, as a result of the credit bid that is part of the purchase price. If Meadowlark is not the buyer, then DIP claims will be paid in full from sale proceeds.

Likewise, in the event that Meadowlark is the buyer of the company’s assets, pre-petition loan secured loan claims will be deemed satisfied by the credit bid. Otherwise, holders will receive their pro rata share of the distributable cash remaining after the funding of the wind-down reserve and the professional fee escrow account, up to the full amount of each pre-petition loan secured claim.

Holders of pre-petition loan deficiency claims will receive their pro rata share of the unsecured claims distributable cash.

Holders of other priority claims will receive payment in full in cash from the wind-down reserve, or other treatment that leaves holders unimpaired.

Holders of other secured claims will be paid in full in cash, receive the collateral securing their claims or receive other treatment leaving them unimpaired.

Holders of general unsecured claims will receive their pro rata share of the unsecured claims distributable cash.

Holders of section 510(b) claims and Nine Point Energy Holdings interests will receive no recovery except to the extent that unsecured claims distributable cash remains after satisfaction in full of general unsecured claims and pre-petition loan deficiency claims, in which event holders will be entitled to their pro rata share of the remaining unsecured claims distributable cash.

Holders of intercompany claims and intercompany interests will not receive any distribution.

The Denver-based exploration and production company filed bankruptcy on March 15 under Chapter 11 case number 21-10570.

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