According to the U.S. Bankruptcy Court docket, the Court approved New Gulf Resources’ motion to approve a compromise, under Rule 9019, with respect to a settlement agreement by and between the Debtors and Energy & Exploration Partners (ENXP).
As previously reported, “If the Settlement Agreement is promptly approved by New Gulf’s and ENXP’s respective Bankruptcy Courts and becomes effective, the substantial amount of litigation among the parties will cease, New Gulf and ENXP will have certainty as to how they will be treated under each other’s plan, and important conditions precedent to the effectiveness of the Debtors’ chapter 11 plan will be satisfied. All of this greatly increases the likelihood of New Gulf successfully exiting chapter 11 on the time line contemplated by the Restructuring Support Agreement, dated December 17, 2015, by and among the Debtors and the Ad Hoc Committee.”
Court-filed documents continue, “New Gulf agrees to pay ENXP, from the funds released from escrow, an amount equal to $3 million, less a reserve that will be held by New Gulf to fund ENXP’s share of the cost of certain specified lease elections that ENXP may make under the JOAs prior to the seventh day following the confirmation of the Debtors’ Plan. New Gulf agrees to waive its secured claim in ENXP’s cases of approximately $3.086 million, for ENXP’s unpaid share of drilling costs….Through the Settlement Agreement, there will be an elimination of ENXP’s $15 million secured claims, a substantial savings in the costs of litigation for these estates, and an increased likelihood in the occurrence of the effective date of the Debtors’ Plan.”
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