Global Geophysical wins court backing on plan disclosure statement

By Kali Hays

New York, Oct. 30 – Global Geophysical Services Inc. received approval of the disclosure statement related to its proposed plan of reorganization on Thursday from the U.S. Bankruptcy Court for the Southern District of Texas, according to an attorney familiar with the case.

The company is still participating in a “market test” for the sale of substantially all company assets for a higher value than the $190 million value currently projected for the reorganized company in a backstop agreement approved by the court Oct. 15.

Under approved bid procedures, the deadline for bidding on the assets is Dec. 3.

If the company does not receive a more favorable transaction, it intends to move forward with the reorganization plan, with a confirmation hearing set for Dec. 9.

As previously reported, Global Geophysical said the proposed plan is supported by its board of directors, holders of roughly 57% of its senior notes and substantially all of its $151.9 million debtor-in-possession loans and its official committee of unsecured creditors.

“The restructuring will substantially reduce the company’s debt burden, enhance its liquidity, and solidify the company’s long-term growth and operating performance” and also “provide for a substantial recovery for unsecured creditors in a Chapter 11 case where the senior secured post-petition lenders have agreed to equitize approximately one-third to one-half of their debt,” the plan stated.

Plan terms

Under the plan, the company will enter in to an exit credit facility consisting of a term loan of up to $100 million and a revolving credit facility of up to $50 million, repay $60 million in term A loans and a portion of term B loans totaling $91.88 million.

Specific treatments of creditors under the plan are as follows:

• Holders of general administrative claims, priority tax claims, other priority claims, other secured claims professional claims, secured Amegy claims and secured capital lease claims will be paid in full in cash;

• Holders of secured DIP term A loan claims will be paid in full and holders of term B loan claims will be paid a proportionate share of rights offering proceeds, if any, and the term B loan conversion shares;

• Holders of financial claims will receive a proportional share of 11.95% to 32.71% of the new common stock of the reorganized company and warrants;

• Holders of trade claims will receive a proportional share of $3 million of cash proceeds and a library fund capped at $250,000; and

• Holders of subordinated claims and equity interest claims will receive no recovery.

Global Geophysical, a Missouri City, Texas-based provider of seismic data services to the oil and gas industry, filed for bankruptcy on March 25. The Chapter 11 case number is 14-20130.

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