Energy Alloys Holdings files term sheet for plan support agreement

By Sarah Lizee

Olympia, Wash., April 26 – Energy Alloys Holdings, LLC is seeking authorization to enter into a binding plan support agreement term sheet between the debtors, the official committee of unsecured creditors, the Wingfoot/second-lien required lenders, Blackstone/GSO Capital Solutions Fund LP and GSO CSOMF Energy Alloys, Inc., according to a motion filed Friday with the U.S. Bankruptcy Court for the District of Delaware.

The term sheet contemplates the wind-down of the debtors and their estates under a combined Chapter 11 plan of liquidation and disclosure statement to be confirmed by the court.

The plan will provide for the liquidation and distribution of proceeds from the claims, causes of action and avoidance actions and other assets, net of any costs of liquidation or distribution, through a to-be-established liquidation trust, and the funding of those wind-down efforts.

The term sheet contains milestones, including filing a combined plan and statement no later than May 3, obtaining approval to enter into the term sheet no later than May 18, and receiving confirmation of the plan and having the plan go into effect no later than June 30.

Under the plan, all fee claims will be paid in full.

Holders of pre-petition secured lender claims will receive 75% of the debtors’ cash on hand as of the effective date; net proceeds from the sale of any of the debtors’ property on which the pre-petition secured lender has a valid lien; the remaining claims reserve; and the remaining fee escrow amount. They will also receive 100% of the recoveries from causes of action against the pre-petition secured lender and related parties; against the debtors’ present of former employees with respect to wage and severance payments; related to the severance and retention bonuses paid to Kevin Burnett, Doris Stuart and Neil Thomas, and related to board of director fees.

Holders of general unsecured claims will receive their pro rata share of the interests in the liquidation trust, as those distributions become available.

Holders of intercompany claims and equity interests will not receive or retain any property under the plan.

A hearing is scheduled for May 18.

Houston-based Energy Alloys provides oilfield metals, services and supply chain solutions to global oil and gas manufacturers and service companies in the energy industry. The company filed Chapter 11 on Sept. 9 under case number 20-12088.

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