Rooster Energy Ltd. and six affiliated Debtors filed for Chapter 11 protection with the U.S. Bankruptcy Court in the Western District of Louisiana, lead case number 17-50705 (Rooster Energy, L.L.C.). The Company, which explores for, develops, and produces oil and gas properties, is represented by Jan M. Hayden of Baker, Donelson, Bearman, Caldwell & Berkowitz.
The Company anticipates that it will file for recognition of any orders entered under Chapter 11 of the Code under the Companies’ Creditors Arrangement Act (CCAA). British Columbia, Canada-based Rooster Energy Ltd. is the ultimate parent corporation of the other Debtors, and its common stock trades on the TSX Venture Exchange.
Rooster Energy has arranged for up to $525,000 in debtor-in-possession financing from lender from Corn Meal: a special purpose entity formed and owned by Chester F. Morrison, Jr., the largest shareholder in Rooster Energy and a holder of a significant portion of the subordinated secured debt as well as other unsecured debt. Rooster Energy’s C.E.O., Kenneth F. Tamplain, Jr., notes, “To be clear, I do not believe that the DIP Loan proceeds are sufficient to allow the Debtors to fund operations absent approval of the use of Cash Collateral.”
Documents filed with the Court explain, “As a result of sustained, low oil and natural gas commodity prices, the oil and gas industry in general is in severe crisis. Independent oil and gas producers have been significantly affected, with over 100 companies filing for bankruptcy in 2015 and 2016.”
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