Bankrupt company's official committee of unsecured creditors is asking a judge to postpone the hearing on a restructuring support agreement it had no involvement in and is seeking authority to commence litigation.
Mike Moreno
Green Field Energy Services' official committee of unsecured creditors is asking a judge to postpone a hearing on a restructuring support agreement that settles a number of disputes involving Green Field, its largest customer Royal Dutch Shell PLC, bondholders and company founder Mike Moreno, The Wall Street Journal reported Jan. 6.
Earlier this week ABiz reported that Moreno's Green Field Energy Services, which filed for Chapter 11 bankruptcy protection Oct. 23 along with affiliated companies Hub City Tools and Proppant One, told the court on Dec. 17 that it wants to pay bonuses to its employees. However, that plan, filed in U.S. bankruptcy court in Delaware, is not sitting well with U.S. Trustee Roberta A. DeAngelis, who said in court documents Dec. 31 that the "Bonus Plan" is more about keeping the employees from jumping ship, rather than rewarding them for job performance. Retention bonuses for high-level employees are typically illegal in bankruptcy; they must be tied to challenging goals that require officers to perform at a high level so that the company can successfully restructure. Even then, such bonuses are being more closely scrutinized by the courts. Read that story here.
The creditors committee for the bankrupt oil services company was not involved in the restructuring deal, in which bondholders owed about $256 million will get stock in a reorganized company named NewCo. The WSJ reports that Moreno would get equity in NewCo in return for his contribution of his stake in Turbine Generation Services, formerly Green Field Power Generation, to the new company.
WSJ also reported:
The proposed deal calls for Green Field's assets to be sold at a bankruptcy auction, with Shell receiving a percentage of the asset sale, plus $5 million of the company's cash and a so-called turnover distribution capped at $40 million.
Creditors are also asking for the appointment of an examiner, or independent outsider with investigative powers, and they are seeking authority to commence litigation in Green Field's Chapter 11 case.
Read the story here.