ERG Intermediate committee settlement with LVN, CLMG approved

By Mark Reccek

Bethlehem, Pa., Aug. 27 – ERG Intermediate Holdings LLC’s official committee of unsecured creditors received authorization of a final settlement with LVN Corp. and CLMG Corp., according to an order filed Wednesday with the U.S. Bankruptcy Court for the Northern District of Texas.

CLMG serves as the debtor-in-possession and collateral agent and LVN as the DIP lender.

The terms of the settlement include LVN funding $4 million in payments to necessary suppliers, funding of an advance in the amount of $1 million to the liquidated trust for the purposes of liquidating the assets and funding the committee’s professional fees.

Additional settlement terms include a waiver of any right to distributions due LVN as a result of unsecured deficiency, waiver by LVN of liens against certain property, the committee’s waiver of any challenges to claim stipulations under the final DIP order, as well as committee support of any approved transaction, including LVN's right to credit bid on the assets.

As previously reported, ERG said the settlement would eliminate the need for costly and lengthy litigation, while providing a stream of funding to the unsecured creditors.

ERG is a Houston-based independent oil and gas company that filed for bankruptcy on April 30. The Chapter 11 case number is 15-31858.

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