Swift Energy granted bankruptcy court approval of reorganization plan

By Caroline Salls

Pittsburgh, March 31 – Swift Energy Co.’s plan of reorganization was confirmed on Thursday by the U.S. Bankruptcy Court for the District of Delaware.

The reorganization implements a restructuring agreement that was reached with an ad hoc group of senior noteholders before the company filed for bankruptcy.

Treatment of creditors will include the following:

• RBL credit agreement secured claims will be paid in full in cash. Treatment of this loan had not been agreed at the time the company filed for Chapter 11. Cash for the refinancing will come from a new $320 million reserve-based exit loan to be provided by Swift’s bank group. This loan will also fund other obligations under the plan and the company’s ongoing operations;

• Other secured claims will be reinstated or holders will be paid in full in cash or receive the collateral securing the claims;

• The $75 million DIP facility will be converted to equity. Treatment of this facility had not been agreed at the time the company filed for Chapter 11;

• Holders of senior notes and rejection claims will receive a share of a distribution equal to 88.5% of new common stock;

• General unsecured claims will be either reinstated or paid in full in cash;

• Intercompany claims and intercompany interests will be reinstated; and

• Holders of equity interests will receive new equity and warrants if they opt to grant voluntary plan releases and no distribution if they do not grant the releases. The new equity will represent 4% of the common stock and the warrants will represent 30%.

The plan will cut Swift’s debt by $905 million.

Swift Energy said in a news release that it expects to exit from Chapter 11 on or before April 15.

Swift Energy is a Houston-based developer, explorer, acquirer and operator of oil and gas properties, with a focus on oil and natural gas reserves onshore in Texas and Louisiana and in the inland waters of Louisiana. It filed for bankruptcy on Dec. 31. The Chapter 11 case number is 15-12670.

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