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Triangle USA Petroleum Objection Filed

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Triangle Petroleum (TPC) acting through the special committee of the board of directors filed with the U.S. Bankruptcy Court an objection to Triangle USA Petroleum’s (TUSA) Disclosure Statement.

The objection asserts, “Under the Plan, the Debtors propose to cancel TPC’s shares in TUSA without any distribution to TPC on account of its equity interest. The proposed treatment of TPC’s equity interest, and the absence of a grant of a warrant to TPC with a strike price that would guarantee full repayment of creditors before TPC could exercise such warrant, may risk violating the absolute priority rule by overpaying senior creditors at a junior class’s expense….Under the Plan, the Debtors further request that the Court enter an injunction (the ‘Tax Injunction’) that would enjoin TPC from claiming a ‘worthless stock deduction’ on account of its loss of its $468 million in downstream transfers to TUSA and otherwise prohibiting TPC from taking steps that might limit TUSA’s post-emergence use of its ‘net operating losses.’ The consequences of the Tax Injunction to TPC would be severe: TPC would be prevented from claiming an approximately $468 million worthless stock deduction to which it is entitled under tax law that could be used to offset TPC’s future taxable income.”

In addition, “[T]hrough this Objection, TPC seeks certain clarifications and inclusion by the Debtors of risk factors regarding TPC’s objections herein, and ramifications to creditors under the confirmation process and Plan, if TPC’s objections are sustained, to insure that all creditors are provided information sufficient to enable them to make an informed decision before they cast votes to accept or reject the Plan.”

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The post Triangle USA Petroleum Objection Filed appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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