OFS International gets interim OK of statement; plan hearing Dec. 9

By Sarah Lizee

Olympia, Wash., Oct. 28 – OFS International, LLC received interim approval of the disclosure statement for its Chapter 11 plan of reorganization, according to an order filed Thursday with the U.S. Bankruptcy Court for the Southern District of Texas.

The combined hearing on final approval of the statement and confirmation of the plan is scheduled for Dec. 9.

According to the disclosure statement, the plan will be implemented with funds available from one or more new term loans secured by the debtors’ real estate, one or more new revolving credit facilities secured by the debtors’ non-real estate assets, available cash on hand as of the effective date, a new value contribution, and future revenues generated by the reorganized debtors’ business operations.

The company said the debtors have received multiple term sheets for refinancing their real estate and non-real estate assets and are in the process of negotiating and finalizing the best terms available.

Under the plan, the holder of the debtor-in-possession facility will receive a cash payment equal to the remaining amount of its claim.

The holders of the PAO TMK secured claim will have an allowed secured claim in the amount of $17.6 million, which will be paid in cash in full.

Secured tax claims will be paid in full in cash.

Holders of secured equipment claims will have their claims reinstated or receive other treatment leaving their claims unimpaired.

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

The PPP claim will be reinstated.

Holders of convenience claims will receive payment in full in cash.

Holders of general unsecured claims will receive their pro rata share of the initial GUC distribution, which is $1.25 million in cash, and the plan payments, which will be equal to the sum of $2.5 million with interest accruing at 5% per annum, amortized over three years, with payments to start seven months from the effective date and thereafter paid quarterly.

In exchange for the new value contribution, which is $350,000 in cash, all interests will be reinstated.

The Houston-based company provides oil company tubular goods and services. The company filed bankruptcy on May 31 under Chapter 11 case number 21-31784.

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