General Maritime disclosure approved; plan hearing set for April 25

By Caroline Salls

Pittsburgh, Feb. 29 - General Maritime Corp. received court approval of the disclosure statement for its first amended plan of reorganization, according to a Wednesday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The plan confirmation hearing is scheduled for April 25.

As previously reported, General Maritime filed bankruptcy to implement an agreement reached with its key senior lenders on the terms of a financial restructuring designed to strengthen the company's balance sheet and enhance its financial flexibility.

The key senior lenders include General Maritime's bank group, led by administrative agent Nordea Bank Finland plc, New York Branch and affiliates of Oaktree Capital Management, LP.

Under the agreements, funds managed by Oaktree will provide a $175 million new equity investment in General Maritime and convert its pre-bankruptcy secured debt to equity, less the amount raised in an up to $61.25 million rights offering.

Plan terms

Under the plan

• Oaktree will provide the reorganized company with a new $175 million equity investment, $75 million of which will be used to pay down the company's senior secured first-lien facilities;

• Oaktree will convert 100% of its senior secured debt into equity of the reorganized company;

• The key senior lenders will amend their credit facilities to provide the company with an amortization holiday until June 2014, deferring roughly $140 million of cash payments for two and a half years;

• DIP facility claims, administrative and priority claims will be paid in full in cash;

• Holders of claims pre-bankruptcy senior facility claims will each receive pay-downs and a share of new credit facilities;

• Holders against debtors that are not obligated on the company's pre-bankruptcy funded debt obligations will receive any cash available for distribution after all senior claims are paid in full;

• Holders of general unsecured claims against General Maritime will receive a share of warrants to purchase new common stock, exercisable at a cash-less strike price reflecting a total implied equity value of $421.1 million for the reorganized debtors at any time for a period of five years from the plan effective date, representing a total of 2.5% of the new General Maritime common stock;

• Eligible holders of general unsecured claims against debtors that are obligated on the pre-bankruptcy funded debt obligations will receive a share of the rights to subscribe for up to 17.5% of new common stock in exchange for up to $61.25 million in cash, as well as applicable oversubscription rights;

• Guarantor debtor general unsecured creditors who are not eligible to participate in the rights offering will receive the lesser of their share of a non-eligible distribution fund or 0.75% of the amount of the claim in cash;

• All existing equity interests will be cancelled, and holders will receive no distribution.

General Maritime is a New York-based provider of international seaborne crude oil transportation services. The company filed for bankruptcy on Nov. 17. The Chapter 11 case number is 11-15285.

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