PrimaLend Capital Partners - Chapter 11 Plan Terms
PrimaLend Capital Partners’ proposed Chapter 11 liquidation plan contemplates the credit-bid sale of assets to First Lien PCP Lenders and Amarillo National Bank subject to an alternative transaction toggle, whereby unsecured noteholder recoveries are channeled through a Liquidating Trust seeded with a $350,000 cash carve-out and litigation claims against non-released insiders.
RSA Terms
Overview
- The Plan is the result of extensive good faith negotiations between the Debtors and key economic stakeholders, contemplating multiple transactions designed to maximize value for all parties.
- Pursuant to Bankruptcy Rule 9019, the Plan constitutes a good faith compromise and settlement of all claims, interests, and controversies relating to contractual, legal, and subordination rights.
Sale Transactions
- The proposed restructuring contemplates the sale of assets through credit bid transactions negotiated with senior secured lenders, subject to "toggle" provisions allowing for alternative transactions pursuant to bidding procedures:
- PCP Transferred Assets: To be sold to an entity formed by the First Lien PCP Lenders in exchange for the PCP Credit Bid.
- Subject to an "Alternative Transaction Toggle" allowing for a sale to a Successful Bidder with the First Lien PCP Lenders' consent.
- GFL Transferred Assets: To be transferred to Amarillo National Bank (ANB), or its assigns, in full satisfaction of amounts owed on the Prepetition GFL Credit Facility Claims.
- Subject to an ability to sell the assets to a Successful Bidder with ANB’s consent.
- PCP Transferred Assets: To be sold to an entity formed by the First Lien PCP Lenders in exchange for the PCP Credit Bid.
DIP Financing
- The Debtors secured a postpetition senior secured superpriority term loan facility ("DIP Facility"), approved by the Bankruptcy Court on an interim basis.
- DIP Facility Claims include all principal, interest, reasonable and documented fees, expenses, and other charges held by the DIP Lenders and DIP Agent.
Chapter 11 Plan of Liquidation
- Liquidating Trust: The Plan provides for the creation of a Liquidating Trust for the benefit of Senior Unsecured Noteholders, Junior Unsecured Noteholders, and General Unsecured Creditors.
- On the Effective Date, the Liquidating Trust Assets shall automatically vest in the trust free and clear of all liens and encumbrances.
- Transferred assets include:
- Claims and Causes of Action against Insiders (excluding Released Parties);
- Avoidance Actions; and
- The Liquidating Trust Expense Carve-Out.
- Wind Down Administrator: A trustee will be appointed on the Effective Date to oversee the Wind Down Estates and the dissolution of the Debtors in accordance with the Plan.
Wind-Down Funding
- The Plan establishes a "Liquidating Trust Expense Carve-Out" to fund the administration of the trust.
- This consists of $350,000 in cash to be funded from the Debtors' Cash and deposited into a reserve on the Effective Date.
Releases and Exculpation
- Released Parties: The Plan provides for releases of claims and causes of action (excluding criminal acts, intentional fraud, gross negligence, or willful misconduct) for specific parties, including:
- The Debtors and the Wind Down Administrator;
- The DIP Lender;
- The Prepetition First Lien PCP Lenders;
- The Committee and the Ad-Hoc Noteholders Group (including their respective members);
- The Independent Manager; and
- Professionals retained by the Debtors, Independent Manager, or Committee.
- Exculpated Fiduciaries: The Plan exculpates the Debtors, Wind Down Administrator, the Committee and its members, and the Independent Manager for acts or omissions taken in their capacities during the Chapter 11 Cases.