Nine Point Energy secures approval to sell assets to lender affiliate

By Sarah Lizee

Olympia, Wash., June 30 – Nine Point Energy Holdings, Inc. received court approval to sell its assets to stalking horse bidder Meadowlark Resources LLC, an affiliate of pre-petition lender AB Private Credit Investors LLC, according to an order filed Tuesday with the U.S. Bankruptcy Court for the District of Delaware.

The purchase price includes a credit bid, on a dollar-for-dollar basis, of $250 million, comprised of the full amount of the debtor-in-possession obligations outstanding as of the closing date, and up to 100% of the pre-petition obligations.

In addition to approving the sale, the court granted pipeline provider Caliber adequate protection for its liens. The purchaser will assume Caliber’s disputed secured claim in an amount to be determined by the court.

As previously reported, Caliber asserts it has first-priority liens in some assets of the debtors, including priority over the liens granted to the debtors’ DIP lenders, the replacement liens granted to the agent and the lenders, and the agent’s and lenders’ pre-petition liens in the property and assets.

Caliber had objected to the company’s asset sale motion, saying that it purported to provide holders of interests or claims adequate protection in the form of attachment to the “net cash proceeds of the sale,” but because the sale process contemplated that the pre-petition lenders and DIP lenders would credit bid their debt, there would be no cash proceeds if they were the winning bidder.

Under these circumstances, Caliber said its interests would be protected only if its senior liens “ride through” the sale and remain attached to the purchased assets, or the credit-bidding purchaser funds an escrow, posts security, or provides other assurances that Caliber’s senior liens will be paid.

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

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.