C&J Energy Services filed with the U.S. Bankruptcy Court a Second Amended Joint Plan of Reorganization and related Disclosure Statement.
According to the Disclosure Statement, “The Debtors have reached a comprehensive settlement with the Committee. The material terms of the settlement are as follows: the Debtors will increase the aggregate Cash consideration paid to holders of Unsecured Claims to $33 million, which amount will be split between the Convenience Class Recovery Pool (in an amount not to exceed $2.5 million) and the Unsecured Creditor Cash Pool (in an amount not less than $30.5 million); the Debtors will divide the New Warrants into the Unsecured Creditor New Warrants (exercisable into up to 4% of the New Common Stock), which will be included in the Unsecured Creditor Recovery Pool, and the Interest Holder New Warrants (exercisable into up to 2% of the New Common Stock), which will be distributed, as applicable, to holders of Interests in C&J Energy.”
The Disclosure Statement continues, “[O]n the Effective Date, the Debtors and the Committee will enter into the Unsecured Creditor Agreement, which will govern certain aspects of the post-Effective Date reconciliation, objection, settlement, and distribution of General Unsecured Claims and which contemplates appointment of an Unsecured Claims Representative (that will be granted certain consultation rights and standing to object to certain Claims), all as described more fully in Article VI.F of the Plan; the Committee will agree to (a) support and take actions necessary to obtain Bankruptcy Court approval of the Plan and Disclosure Statement, (b) not object to the Debtors’ senior executive incentive plan, as modified by the Debtors and the Required Supporting Creditors, and (c) abate all discovery requests and suspend all discovery efforts with respect to the Debtors, the holders of Lender Claims, and their respective representatives; and the Debtors, the Committee, and the Supporting Creditors will agree to toll the Challenge Period indefinitely, subject to certain limitations.”
In addition, “The compromises and settlements to be implemented pursuant to the Plan preserve value by enabling the Debtors to avoid costly and time-consuming litigation with the Committee that could delay the Debtors’ emergence from chapter 11.”
The Debtors also filed the following amended Disclosure Statement Exhibits: Exhibit F: liquidation analysis, Exhibit G: financial projections and Exhibit H: valuation analysis.
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