Stone Energy equity committee motion denied under plan treatment deal

By Caroline Salls

Pittsburgh, Dec. 21 – An informal Stone Energy Corp. shareholders group’s motion for appointment of an official equity committee for Stone’s Chapter 11 case was denied Wednesday in accordance with a related stipulation, according to an order filed with the U.S. Bankruptcy Court for the Southern District of Texas.

Under the stipulation, the informal shareholders’ group will support confirmation of the company’s plan of reorganization.

In addition, the stipulation provides that holders of pre-bankruptcy notes claims will receive 95% of the new common stock in the reorganized company, provided, however, that if the court orders appointment of an official equity committee any time before the plan effective date, that amount will be increased to 96%.

Holders of old common stock or other Stone equity interests that were exchanged for old common stock that did not submit a release opt-out will receive 5% of the new common stock. If an official equity committee is appointed before the effective date, that amount will be reduced to 4%.

Holders of old common stock that object to or take any action to interfere with the effectiveness of the plan will receive no distribution.

Stone Energy is a Lafayette, La., oil and gas exploration and production company. The company filed bankruptcy on Dec. 14 under Chapter 11 case number 16-36390.

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