INTERNATIONAL SHIPHOLDING CORPORATION (OTCMKTS:ISHCO) Files An 8-K Bankruptcy or Receivership
Item 1.03.
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Bankruptcy or Receivership.
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As previously reported by International Shipholding Corporation
(the Company), on July 31, 2016, the Company and certain of its
direct and indirect subsidiaries (together with the Company, the
Debtors) filed voluntary petitions for relief under Chapter 11 of
Title 11 of the U.S. Code (the Bankruptcy Code) in the United
States Bankruptcy Court for the Southern District of New York
(the Bankruptcy Court). The Debtors Chapter 11 cases are being
jointly administered under the caption and case number, In re:
International Shipholding Corporation, et al., Case No. 16-12220
(Jointly Administered).
(the Company), on July 31, 2016, the Company and certain of its
direct and indirect subsidiaries (together with the Company, the
Debtors) filed voluntary petitions for relief under Chapter 11 of
Title 11 of the U.S. Code (the Bankruptcy Code) in the United
States Bankruptcy Court for the Southern District of New York
(the Bankruptcy Court). The Debtors Chapter 11 cases are being
jointly administered under the caption and case number, In re:
International Shipholding Corporation, et al., Case No. 16-12220
(Jointly Administered).
Confirmation of Plan
On March 2, 2017, the Bankruptcy Court entered an order
confirming (the Confirmation Order) the First Amended Modified
Joint Chapter 11 Plan of Reorganization for International
Shipholding Corporation and its Affiliated Debtors (the Plan of
Reorganization). Copies of the Confirmation Order and the Plan of
Reorganization are filed as Exhibit 99.1 and Exhibit 2.1,
respectively, to this Current Report on Form 8-K and are
incorporated by reference into this Item 1.03.
confirming (the Confirmation Order) the First Amended Modified
Joint Chapter 11 Plan of Reorganization for International
Shipholding Corporation and its Affiliated Debtors (the Plan of
Reorganization). Copies of the Confirmation Order and the Plan of
Reorganization are filed as Exhibit 99.1 and Exhibit 2.1,
respectively, to this Current Report on Form 8-K and are
incorporated by reference into this Item 1.03.
Summary of Plan
The Plan of Reorganization, as confirmed by the Bankruptcy Court,
generally provides for the following treatment of classes and
types of claims and interests in the Debtors (terms used below
refer to the terms set forth in the Plan of Reorganization):
generally provides for the following treatment of classes and
types of claims and interests in the Debtors (terms used below
refer to the terms set forth in the Plan of Reorganization):
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SEACOR Capital Corp. (SEACOR) will cause $25.0 million of
committed financing to be made available to the Debtors by one or more money center banks; |
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SEACOR will provide a capital infusion of $10.5 million
(the Cash Consideration) in exchange for 35.6% of the ownership interests in the reorganized Company; provided that, if the proceeds from certain vessel dispositions, less the amount necessary to satisfy the DVB Facility claims and the purchase of certain leased vessels, are equal to or less than $15.2 million, then the Cash Consideration may be increased by an amount equal to such deficiency up to $13.5 million; |
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SEACOR will buy out any portion of the
Debtor-in-Possession Credit Agreement among Company and the other Debtors party thereto, as borrowers, SEACOR Capital Corp, as administrative agent, collateral agent, security trustee and a lender, and DVB BANK SE, as a lender (as amended, the DIP Credit Facility) funded by any other party, so that it is the sole beneficial owner of any DIP Credit Facility claims in exchange for 64.4% of the ownership interests in the reorganized Company; provided, however that with respect to those funds advanced to the fifth amendment to the DIP Credit Facility, the Debtors shall repay such borrowing in cash prior to the effective date of the Plan of Reorganization; |
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holders of allowed claims on account of certain of the
Debtors fixed rate credit agreement with DVB Bank SE (the DVB Facility) will receive, at the option of the applicable Debtor, with the consent of SEACOR or the reorganized Debtors, as applicable, in full and final satisfaction of such claims, either (i) a cash payment in the amount of $28,162,271.03, plus interest and any reasonable fees, costs, or charges provided for under the DVB Facility to the extent required under section 506(b) of the Bankruptcy Code, (ii) in the event of any disposition of the collateral securing such allowed DVB Facility claim, the proceeds generated by such disposition up to an amount sufficient to provide payment in full, subject only to claims secured by such collateral that are senior in priority to the allowed DVB Facility claims, or (iii) delivery of the collateral securing such allowed DVB Facility claim to the agent under the DVB Facility or its nominee; |
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holders of allowed claims on account of certain of the
Debtors credit agreement with Citizens Asset Finance will receive, at the option of the applicable Debtor, with the consent of SEACOR or the applicable reorganized Debtor, as applicable, in full and final satisfaction of such claims, either (i) in the event of any disposition of the collateral securing such claims, the proceeds generated by such disposition or (ii) delivery of the collateral securing such claims to the holder of such claims; |
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holders of allowed claims on account of certain of the
Debtors variable rate financing agreement with Capital One N.A. will receive, at the option of the applicable Debtor, with the consent of SEACOR or the applicable reorganized Debtor, as applicable, in full and final satisfaction of such claims, either (i) in the event of any disposition of the collateral securing such claims, the proceeds generated by such disposition or (ii) delivery of the collateral securing such claim to the holder of such claim; |
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holders of allowed claims on account of certain of the
Debtors senior secured credit facility with a syndicate of lenders led by Regions Bank (the Regions Facility) will receive their pro rata share of: |
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(i) the proceeds generated from the disposition or
collection of certain collateral under the Regions Facility or (ii) solely to the extent that all of such collateral has not been disposed of or collected, as applicable, prior to the effective date, a non-recourse note issued to Regions Bank, as agent, in the principal amount equal to $4.5 million minus the amount of proceeds realized and paid on account of such claim from the disposition or collection, as applicable, of such collateral, plus |
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cash in an amount necessary to satisfy the secured
Regions Facility claims in full after accounting for any distribution described above; |
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holders of Allowed Other Priority Claims will receive,
in full and final satisfaction of such claims, payment of such claims in full in cash unless the holders of such claims agree to an alternative treatment; |
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holders of Allowed Other Secured Claims will receive,
at the option of the applicable Debtor, with the consent of SEACOR or the applicable reorganized Debtor, as applicable, in full and final satisfaction of such claims, either (i) payment in full in cash, including interest, to the extent applicable or (ii) such other treatment as may be agreed to by the holders of such claim and the applicable reorganized Debtor; |
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holders of Allowed General Unsecured Claims against
LCI Shipholdings, Inc. will receive, in full and final satisfaction of such claims, their pro rata share of $2.55 million of cash; |
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holders of Allowed General Unsecured Claims against
each of Gulf South Shipping PTE LTD and Marco Shipping Company PTE LTD will receive, in full and final satisfaction of such claims, the remaining cash on hand on the applicable Debtors balance sheet prior to distribution of such cash to holders of interests in the applicable Debtor; |
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holders of Allowed General Unsecured Claims against
the Debtors other than LCI Shipholdings, Inc., Gulf South Shipping PTE LTD and Marco Shipping Company PTE LTD (the GUC Trust Debtors) will receive, in full and final satisfaction of such claims, their pro rata share of $3.0 million in cash; |
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there will be no distribution to holders of 510
Claims on account of such claims; |
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there will be no distribution to the holders of
intercompany claims on account of such claims, and such claims will be cancelled, reinstated, or modified, as determined by the Debtors in consultation with SEACOR, on the effective date of the Plan of Reorganization; |
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all current equity interests in the Company shall be
cancelled and existing equity holders will not receive a distribution on account of their equity interests; and |
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intercompany interests shall be cancelled and, solely
with respect to the Operating Reorganized Debtors (i.e., International Shipholding Corporation; Central Gulf Lines, Inc.; Coastal Carriers, Inc.; Waterman Steamship Corporation; N.W. Johnsen Co., Inc.; Tower LLC; Gulf South Shipping PTE LTD ; and LCI Shipholdings, Inc.) new interests shall be issued and held in accordance with the terms of the Plan of Reorganization. No distributions shall be made on account of the intercompany interests unless all Claims against a Debtor have been satisfied in full, in which case any remaining funds shall be distributed to the applicable holder of intercompany interests. |
The distributions to the holders of the Allowed General
Unsecured Claims described above reflect a settlement reached
between the unsecured creditors committee and the Debtors
with respect to the treatment of the Debtors general
unsecured creditors. As part of the settlement, the unsecured
creditors committee and the Debtors agreed to the formation
of a trust for the benefit of the holders of Allowed Class 7
General Unsecured Claims of the GUC Trust Debtors to be
funded with $3.0 million of cash and certain causes of action
that will be transferred to the trust on the effective date
of the Plan of Reorganization. These cash allocations to the
holders of General Unsecured Claims described above ensures
that the holders of General Unsecured Claims in each class
would receive more than they would in a Chapter 7 liquidation
as set forth in the liquidation analysis attached as an
exhibit to the Disclosure Statement. The settlement assumes
that no payments will be made to the holders of Intercompany
Claims.
Unsecured Claims described above reflect a settlement reached
between the unsecured creditors committee and the Debtors
with respect to the treatment of the Debtors general
unsecured creditors. As part of the settlement, the unsecured
creditors committee and the Debtors agreed to the formation
of a trust for the benefit of the holders of Allowed Class 7
General Unsecured Claims of the GUC Trust Debtors to be
funded with $3.0 million of cash and certain causes of action
that will be transferred to the trust on the effective date
of the Plan of Reorganization. These cash allocations to the
holders of General Unsecured Claims described above ensures
that the holders of General Unsecured Claims in each class
would receive more than they would in a Chapter 7 liquidation
as set forth in the liquidation analysis attached as an
exhibit to the Disclosure Statement. The settlement assumes
that no payments will be made to the holders of Intercompany
Claims.
The Plan of Reorganization provides that, after the entry of
the Confirmation Order but prior to the effective date of the
Plan of Reorganization, and without any further corporate
action or further order of the Bankruptcy Court, the Debtors
are authorized to effect a series of transactions to which
the applicable Debtors will purchase two leased vessels from
their respective lessors and transfer such leased vessels,
plus two owned vessels, to NYK Group Americas Inc. (or an
affiliate of NYK Group Americas, Inc.) for an aggregate
purchase price of $77 million, free and clear of all liens,
claims and encumbrances.
the Confirmation Order but prior to the effective date of the
Plan of Reorganization, and without any further corporate
action or further order of the Bankruptcy Court, the Debtors
are authorized to effect a series of transactions to which
the applicable Debtors will purchase two leased vessels from
their respective lessors and transfer such leased vessels,
plus two owned vessels, to NYK Group Americas Inc. (or an
affiliate of NYK Group Americas, Inc.) for an aggregate
purchase price of $77 million, free and clear of all liens,
claims and encumbrances.
The effective date of the Plan of Reorganization will be a
date specified by the Debtors in a notice, the form and
substance of which shall be reasonably acceptable to
SEACOR, filed with the Bankruptcy Court as the date on
which the Plan of Reorganization will take effect, which
date will be the first business day on which all of the
conditions set forth in the Plan of Reorganization have
been satisfied or waived in accordance with the Plan of
Reorganization and no stay of the Confirmation Order is in
effect.
date specified by the Debtors in a notice, the form and
substance of which shall be reasonably acceptable to
SEACOR, filed with the Bankruptcy Court as the date on
which the Plan of Reorganization will take effect, which
date will be the first business day on which all of the
conditions set forth in the Plan of Reorganization have
been satisfied or waived in accordance with the Plan of
Reorganization and no stay of the Confirmation Order is in
effect.
The description of the Plan of Reorganization is qualified
in its entirety by reference to the full text of the Plan
of Reorganization, a copy of which is attached as Exhibit
2.1 to this Current Report on Form 8-K and incorporated
into this Item 1.03 by reference.
in its entirety by reference to the full text of the Plan
of Reorganization, a copy of which is attached as Exhibit
2.1 to this Current Report on Form 8-K and incorporated
into this Item 1.03 by reference.
Cautionary Note Regarding the Companys Equity Securities
As of February 24, 2017, the Company had 7,436,834 shares
of common stock outstanding, 250,000 shares of 9.50% Series
A Cumulative Perpetual Preferred Stock outstanding, and
316,250 shares of 9.00% Series B Cumulative Perpetual
Preferred Stock outstanding. The Plan of Reorganization
provides that the Companys existing common stock and
preferred stock will be cancelled on the effective date and
the existing holders will not receive any distribution.
Even though the Companys common stock and preferred stock
continues to be quoted on the OTC Pink Marketplace, it has
no underlying asset value under the Plan of Reorganization.
The Companys stockholders should not view the trading
activity of its common stock or preferred stock on the OTC
Pink Marketplace or any other market or trading platform as
being indicative of the recovery the Companys stockholders
will receive in the Chapter 11 case.
of common stock outstanding, 250,000 shares of 9.50% Series
A Cumulative Perpetual Preferred Stock outstanding, and
316,250 shares of 9.00% Series B Cumulative Perpetual
Preferred Stock outstanding. The Plan of Reorganization
provides that the Companys existing common stock and
preferred stock will be cancelled on the effective date and
the existing holders will not receive any distribution.
Even though the Companys common stock and preferred stock
continues to be quoted on the OTC Pink Marketplace, it has
no underlying asset value under the Plan of Reorganization.
The Companys stockholders should not view the trading
activity of its common stock or preferred stock on the OTC
Pink Marketplace or any other market or trading platform as
being indicative of the recovery the Companys stockholders
will receive in the Chapter 11 case.
Assets and Liabilities
In the Companys most recent monthly operating report filed
with the Bankruptcy Court on February 15, 2017 and
furnished as Exhibit 99.1 to the Companys Current Report on
Form 8-K filed with the SEC on February 27, 2017, the
Company reported total assets of $249,123,470.28 and total
liabilities of $210,520,750.98 as of January 31, 2017.
with the Bankruptcy Court on February 15, 2017 and
furnished as Exhibit 99.1 to the Companys Current Report on
Form 8-K filed with the SEC on February 27, 2017, the
Company reported total assets of $249,123,470.28 and total
liabilities of $210,520,750.98 as of January 31, 2017.
| Item 3.03. |
Material Modification to Rights of Security
Holders. |
As provided in the Plan of Reorganization, all outstanding
shares of the Companys common stock and preferred stock
will be cancelled on the effective date of the Plan of
Reorganization.
shares of the Companys common stock and preferred stock
will be cancelled on the effective date of the Plan of
Reorganization.
| Item 5.02. |
Departure of Directors or Certain Officers;
Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
The Plan of Reorganization provides that, as of the
effective date of the Plan of Reorganization, the terms of
the current members of the board of directors and officers
of the Company shall expire.
effective date of the Plan of Reorganization, the terms of
the current members of the board of directors and officers
of the Company shall expire.
| Item 7.01. |
Regulation FD Disclosure.
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On March 6, 2017, the Company issued a press release
announcing the entry of the Confirmation Order by the
Bankruptcy Court. A copy of the press release is
furnished as Exhibit 99.2 to this Current Report on Form
8-K and incorporated into this Item 7.01 by reference.
announcing the entry of the Confirmation Order by the
Bankruptcy Court. A copy of the press release is
furnished as Exhibit 99.2 to this Current Report on Form
8-K and incorporated into this Item 7.01 by reference.
| Item 8.01. |
Other Events.
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Amendments to DIP Credit Facility
On February 1, 2017, the Company and the other Debtors
party thereto, as borrowers, SEACOR, as administrative
agent, collateral agent, security trustee and a lender,
and DVB BANK SE, as a lender, entered into a fourth
amendment to the DIP Credit Facility, that, among other
things, (i) extended the stated maturity date from
January 31, 2017 to March 31, 2017 and (ii) extended the
deadlines to achieve certain milestones under the DIP
Credit Facility and waived certain events of default
related to the failure of the Bankruptcy Court to enter
certain orders approving the disclosure statement and
confirming the plan of reorganization by the deadlines
specified in the DIP Credit Facility. On March 1, 2017,
the same parties entered into a fifth amendment to the
DIP Credit Facility that, among other things, increased
the committed amount under the DIP Credit Facility from
$18.1 million to $20.1 million.
party thereto, as borrowers, SEACOR, as administrative
agent, collateral agent, security trustee and a lender,
and DVB BANK SE, as a lender, entered into a fourth
amendment to the DIP Credit Facility, that, among other
things, (i) extended the stated maturity date from
January 31, 2017 to March 31, 2017 and (ii) extended the
deadlines to achieve certain milestones under the DIP
Credit Facility and waived certain events of default
related to the failure of the Bankruptcy Court to enter
certain orders approving the disclosure statement and
confirming the plan of reorganization by the deadlines
specified in the DIP Credit Facility. On March 1, 2017,
the same parties entered into a fifth amendment to the
DIP Credit Facility that, among other things, increased
the committed amount under the DIP Credit Facility from
$18.1 million to $20.1 million.
Exchange Act Reports
The Company has suspended the filing of its regular
periodic reports on Form 10-K and Form 10-Q with the SEC.
The Company, however, intends to furnish copies of the
Monthly Operating Reports that are required to be
submitted to the Bankruptcy Court under cover of Current
Reports on Form 8-K and to continue to file Forms 8-K
disclosing material developments concerning the Company.
periodic reports on Form 10-K and Form 10-Q with the SEC.
The Company, however, intends to furnish copies of the
Monthly Operating Reports that are required to be
submitted to the Bankruptcy Court under cover of Current
Reports on Form 8-K and to continue to file Forms 8-K
disclosing material developments concerning the Company.
| Item 9.01. |
Financial Statements and Exhibits.
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Exhibits.
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Exhibit No.
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Description
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2.1
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First Amended Modified Joint Chapter 11 Plan of
Reorganization for International Shipholding Corporation and its Affiliated Debtors |
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99.1
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Findings of Fact, Conclusions of Law and Order
Confirming First Amended Modified Joint Chapter 11 Plan of Reorganization for International Shipholding Corporation and Its Affiliated Debtors |
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99.2
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Press Release
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About INTERNATIONAL SHIPHOLDING CORPORATION (OTCMKTS:ISHCO)
International Shipholding Corporation is a holding company. The Company, through its subsidiaries, operates a diversified fleet of the United States and international-flagged vessels that provide domestic and international maritime transportation services under medium to long-term time charters or contracts of affreightment. It operates through three segments: Jones Act, which deploys over two bulk carriers, over three integrated tug or barge units, each consisting of one tug and one barge, and one harbor tug acquired; one belt self-unloading coal carrier to transport coal under a time charter, and one vessel that transports molten sulfur under a contract of affreightment; Pure Car Truck Carriers (PCTCs), which deploys over five PCTCs, including over four United States flag vessels and one international-flagged vessel, and Rail-Ferry, which uses its two roll-on or roll-off special purpose double deck vessels that carry rail cars between the United States Gulf Coast and Mexico. INTERNATIONAL SHIPHOLDING CORPORATION (OTCMKTS:ISHCO) Recent Trading Information
INTERNATIONAL SHIPHOLDING CORPORATION (OTCMKTS:ISHCO) closed its last trading session 00.0000 at 0.0500 with 215 shares trading hands.
