Nuverra Environmental Solutions, Inc. (OTCMKTS:NESC) Files An 8-K Entry into a Material Definitive Agreement
Item1.01.
| Entry into a Material Definitive Agreement. |
As previously disclosed, on May1, 2017, Nuverra Environmental
Solutions, Inc. (the Company) and its subsidiaries (collectively
with the Company, the Nuverra Parties) filed voluntary petitions
under chapter 11 of the United States Bankruptcy Code in the
United States Bankruptcy Court for the District of Delaware (the
Bankruptcy Court) to pursue prepackaged plans of reorganization.
In connection with the Nuverra Parties chapter 11 cases, on
May19, 2017, the United States Trustee for the District of
Delaware appointed an official committee of unsecured creditors
(the Committee) in the chapter 11 cases. On June22, 2017, the
Nuverra Parties entered into a Plan Support Agreement (the PSA)
with the Committee and holders (the Supporting Noteholders) of
approximately 86% of the Companys 12.5%/10.0% Senior Secured
Second Lien Notes due 2021 (the 2021 Notes) as part of a
settlement with the Committee to resolve the Committees issues,
concerns, and objections with respect to certain matters in the
Nuverra Parties proposed plan of reorganization (the Plan).
to the PSA, the Committee agreed to, among other things,
(i)withdraw its objection to the Plan and support efforts to
normalize the Nuverra Parties business operations throughout the
chapter 11 cases, (ii)support confirmation of the Plan, as
amended in connection with the settlement with the Committee (the
Amended Plan), (iii) not take any action to delay, impede, or
interfere with the confirmation of the Amended Plan, and
(iv)cooperate with the Nuverra Parties to oppose any objection to
the Amended Plan. In addition, the Committee agreed that any
payment to the trustee (the Trustee) of the Companys 9.875%
Senior Notes due 2018 (the 2018 Notes) is contingent upon the
Trustee (i)withdrawing its objection to the Nuverra Parties
motion to pay certain prepetition general unsecured claims in the
ordinary course of business and (ii)not taking certain actions
adverse to the Nuverra Parties restructuring efforts.
to the PSA, the Nuverra Parties agreed to file the Amended Plan
and cooperate, along with the Supporting Noteholders, to reduce
the allowed claims in the Affected Classes, other than the 2018
Notes claims. Affected Classes means holders of the 2018 Notes
claims and certain claims relating to the rejection of executory
contracts and unexpired leases. Among other terms and conditions,
as part of the settlement with the Committee, the Plan will be
amended as follows:
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Affected Classes will receive an aggregate 1.25% of the reorganized Companys common stock that remains after giving effect to certain distributions contemplated by the Amended Plan (the Remaining Reorganized Nuverra Common Stock), including shares subscribed for in a rights offering of new shares that may be conducted by the Company prior to the effective date of the Amended Plan (the Rights Offering) and shares distributed to the Supporting Noteholders in respect of secured debtor in possession and term loan claims and first lien term loan claims. The other 98.75% of Remaining Reorganized Nuverra Common Stock will be distributed to holders of the Nuverra Parties existing 2021 Notes. The Plan previously provided for distribution of 0.25% of the Remaining Reorganized Nuverra Common Stock to holders of claims relating to the 2018 Notes only, and 99.75% of Remaining Reorganized Nuverra Common Stock to holders of 2021 Notes. |
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Affected Classes will receive warrants to purchase 1.00% of the reorganized Companys common stock at an exercise price equal to an enterprise value of the reorganized Company equal to $507.6million. |
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The aggregate allowed claims in the Affected Classes will be no more than $45million. |
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The Rights Offering, to which the Company will distribute rights to permit the holders thereof to acquire common stock of the Company at Plan Value of $350million, will be reduced from rights to purchase $150million of newly issued common stock of the Company to $105million. As a result, holders of claims related to the 2018 Notes will have the number of shares they can purchase from the rights distributed in the rights offering reduced from $75million to $30million. |
The foregoing description of the PSA is only a summary and does
not purport to be a complete description of the terms and
conditions under the PSA, and such description is qualified in
its entirety by reference to the full text of the PSA, a copy of
which is filed as Exhibit 10.1 to this Current Report on Form 8-K
and incorporated by reference into this Item 1.01.
Item9.01. |
Financial Statements and Exhibits. |
(d) |
Exhibits |
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| 10.1 |
Plan Support Agreement, dated as of June22, 2017, by and among the Company, its subsidiaries, the Committee, and the Supporting Noteholders |
Nuverra Environmental Solutions, Inc. ExhibitEX-10.1 2 d265822dex101.htm EX-10.1 EX-10.1 Exhibit 10.1 PLAN SUPPORT AGREEMENT This PLAN SUPPORT AGREEMENT (together with all exhibits,…To view the full exhibit click here About Nuverra Environmental Solutions, Inc. (OTCMKTS:NESC)
Nuverra Environmental Solutions, Inc. (Nuverra) provides environmental solutions to customers focused on the development and production of oil and natural gas from shale formations. The Company’s environmental solutions include delivery, collection, treatment, recycling, disposal of water, wastewater, waste fluids, hydrocarbons, and restricted solids that are part of the drilling, completion, and production of shale oil and natural gas. The Company operates through three segments, which include the Northeast division comprising the Marcellus and Utica Shale areas; the Southern division comprising the Haynesville, Eagle Ford and Permian Basin Shale areas, and the Rocky Mountain division comprising the Bakken Shale area. Nuverra operates in select shale areas in the United States, including oil shale areas consisting of the Bakken, Eagle Ford and Permian Shale areas, and natural gas shale areas in Haynesville, Marcellus and Utica.
