New MACH Gen (NMG) and certain of its subsidiaries entered into a restructuring support agreement with its first lien lender and its equity owner. The restructuring will be implemented under a Chapter 11 filing with the U.S. Bankruptcy Court in Delaware.
According to a related court filing, Beal Bank will provide up to $20 million in DIP financing to assist with the reorganization. CLMG will act as administrative and collateral agent for the transaction.
The transactions are designed to reduce NMG’s overall indebtedness, result in the extension of additional credit to NMG from its equity owner and align NMG’s balance sheet with anticipated future financial performance.
Terms of the RSA, subject to customary approvals and conditions, include:
- NMG transferring its interest in the Harquahala electric generating facility to its first lien lender in exchange for a reduction of its indebtedness under its refinanced first lien credit facility
- The same facility refinanced to modify its economic terms and extend its maturity to 2023
- NMG’s equity owner providing additional new financing to NMG
_x000D_
_x000D_
_x000D_
During the restructuring process, NMG expects to continue to meet all its third-party obligations and is working with its suppliers and business partners to ensure its business continues uninterrupted. It anticipates an emergence from bankruptcy in the second half of 2018.
“Since taking over management of the company, CEO Dale Lebsack and I have made it a priority to partner with our lender and equity owner to improve our capital structure,” said John Chesser, chief financial officer of NMG. “The company and its advisors have worked closely with its first lien lender to consensually restructure its credit facility. We’re pleased to announce that we’ve reached a mutually-agreeable plan to restructure our balance sheet, providing for a continued path forward as markets recover.”
Evercore acted as financial advisor, Alvarez & Marsal as restructuring advisor and Young Conaway Stargatt & Taylor as legal advisor for NMG.
NMG owns and manages a portfolio of three natural gas-fired electric generating facilities located in Athens, NY; Maricopa County, AZ and Charlton, MA.
