MD America details plan terms; combined hearing set for Nov. 19

By Sarah Lizee

Olympia, Wash., Oct. 15 – MD America Energy, LLC’s combined hearing on approval of its disclosure statement and confirmation of its Chapter 11 plan of reorganization has been scheduled for Nov. 19, according to a filing in the U.S. Bankruptcy Court for the Southern District of Texas Houston Division.

As previously reported, the company said it plans to implement a comprehensive balance sheet restructuring and pre-packaged plan of reorganization and proposed a confirmation schedule that would result in emerging from bankruptcy in 45 to 60 days.

According to the disclosure statement, the plan will be funded with an equity issuance and a new $60 million four-year first-lien term loan from existing lenders.

The administrative agent for the loan is Loan Admin Co LLC.

Interest is Libor plus 775 basis points, subject to a 1.5% floor.

Amortization is 0.625% paid on a quarterly basis.

Under the plan, holders of other priority claims will be paid in full in cash.

Holders of other secured claims will be paid in full in cash or receive other treatment that renders the claims unimpaired.

Holders of secured tax claims will be paid in full in cash, have their claims reinstated or receive the collateral securing their claims.

Holders of prepetition term loan claims will receive their pro rata share of equity and the new first-lien loan.

Holders of trade claims will be paid in full in cash or have their claims reinstated.

Paycheck protection loan claims will be reinstated.

General unsecured claims and section 510 claims will be discharged without any distribution.

Intercompany claims will be reinstated or, at the option of the reorganized debtors, cancelled. No distribution will be made on account of any intercompany claims other than in the ordinary course of business. Intercompany claims that are reinstated will be subordinate to the new first-lien term loan.

Intercompany interests will be reinstated or cancelled with no distribution.

MD America interests will be cancelled with no distribution.

MD America Energy is a Fort Worth-based exploration and production company that filed Chapter 11 bankruptcy on Oct. 12 under case number 20-34966.

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