Creditors who fought initial bankruptcy exit plan sign off on new liquidation proposal, which does not protect company founder Mike Moreno from future lawsuits.
Dow Jones/The Wall Street Journal's Tom Corrigan reported this week that Green Field Energy Service's unsecured creditors are now supporting the Lafayette-based company's liquidation proposal. For months, the unsecured creditors had fought the exit plan, which still must be approved by the bankruptcy judge.
Millions of dollars in Green Field equipment sat idle March 5 at the old Fruit of the Loom site on Hwy. 14 in Abbeville.
Green Field, the first company to run its hydraulic fracturing equipment on natural gas, filed for Chapter 11 bankruptcy protection Oct. 27, hoping to reorganize its approximately $500 million in outstanding debt - about the same amount it listed in assets.
Dow Jones reported that any proceeds left over from the sale of Green Field's assets after paying secured creditors will be placed in a trust that will be shared by bondholders and unsecured creditors, also noting:
Royal Dutch Shell PLC is waiving all its claims, which exceed $100 million, in exchange for $5 million and protections against future lawsuits. Company founder Michel Moreno will not receive protection from future lawsuits, and any proceeds from lawsuits against him will also be placed in the trust.
Green Field is expected to bring in $67.5 million from the sale of its assets, with $50 million guaranteed through a proposed sale to a unit of Gordon Brothers Group.
Much of the case has centered on resolving disputes over the right to pursue lawsuits against both Shell and Mr. Moreno. Under an earlier plan, creditors lost all such rights, prompting them to request an examiner, or an independent outsider with investigative powers. That plan, which unsecured creditors were not involved in negotiating, was eventually dropped.
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