Trico Marine Services amended liquidation plan effective as of Aug. 11

By Caroline Salls

Pittsburgh, Aug. 11 - Trico Marine Services Inc.'s second amended plan of liquidation took effect on Thursday, according to a filing with the U.S. Bankruptcy Court for the District of Delaware.

The plan was confirmed on Aug. 2.

As previously reported, debtors attorney John Mitchell assured the court at the plan confirmation hearing that changes made to the plan to incorporate settlements with Tennenbaum DIP Opportunity Fund LLC and Tennenbaum Opportunities Partners V LLP and with Arrowgrass Master Fund Ltd. would in no way cause "a material negative impact on the timing, and/or amount of the consideration projected to be distributed to the various classes of creditors as set forth and estimated in the original plan and disclosure."

Under an agreement reached July 28, Tennenbaum is to receive $20 million, allocated between creditor classes five and six, with two-thirds being funded from class five funds and one-third from class six. Tennenbaum also will receive a $250,000 cash payment on the plan's effective date.

Arrowgrass will receive $500,000 as an administrative claim and asked Tuesday that the claim be paid in cash on the plan's effective date. Arrowgrass also has the right to file a 503(b) claim of up to $150,000, which the debtors will not oppose.

Creditor treatment

Under the plan, treatment of creditors includes:

• Holders of administrative claims and priority claims will be paid in full in cash;

• U.S. credit facility claims and debtor-in-possession facility claims were paid in full before the amended plan was filed, so the company will not make any distribution for these claims under the plan;

• Holders of 8 1/8% notes secured claims will be paid in full in cash. Trico said operating company equity and warrants will not be monetized to satisfy the notes claims unless they have not been paid in full one year from the plan effective date;

• Holders of other secured claims will either be paid in full in cash, have their claims reinstated or receive the collateral securing the claims;

• Holders of general unsecured claims will receive a share of $250,000 in cash;

• Holders of qualified investor claims and 8 1/8% notes deficiency claims will receive a share of distribution assets; and

• Holders of inter-company claims, inter-company interests and old TMS equity will receive no distribution.

Trico, a marine services company based in the Woodlands, Texas, filed for bankruptcy on Aug. 25, 2010. The Chapter 11 case number is 10-12653.

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