Daily News: February 3, 2012

General Maritime Files Reorganization Plan, Disclosure Statement

General Maritime Corporation announced that it has filed a Plan of Reorganization and a Disclosure Statement with the U.S. Bankruptcy Court for the Southern District of New York. The company intends to seek confirmation of the plan by April 2012.

Under the terms of the plan, the company will receive an infusion of $175 million in new capital from funds managed by Oaktree Capital Management, L.P., less the amount raised in the rights offering described below, will continue to operate as a going concern and will reduce its funded indebtedness by approximately $600 million.

Jeffrey D. Pribor, General Maritime’s CFO, said, “The filing of our plan represents a significant milestone in our financial restructuring efforts. We have made good progress and are confident that this process will strengthen our balance sheet and enhance our financial flexibility without compromising our commitments to our valued customers, vendors and employees. We look forward to emerging as a stronger company, positioned for long-term growth as a leading provider of international seaborne oil transportation services.”

Additional terms of the plan include:

  • tax claims, obligations under the debtor-in-possession credit agreement, and other obligations secured with assets of the company will be paid in full, in cash;

  • $75 million of the company’s existing first and second lien secured credit facilities will be paid down, and the company will enter into new first and second lien secured credit facilities with terms that will provide the company with critical financial flexibility needed to operate its businesses after its emergence from bankruptcy;

  • the secured amount of the company’s existing third lien credit facility from Oaktree-managed funds will be converted into 50% of the new equity of the reorganized company on an undiluted basis;

  • holders of general unsecured claims against General Maritime will receive their pro rata share of warrants to purchase 2.5% of the new equity of the reorganized Company;

  • holders of general unsecured claims against the debtors who guarantee the company’s obligations under its secured facilities have the opportunity to participate in a rights offering to purchase up to 17.5% of the new equity of the reorganized Company on an undiluted basis for up to $61.25 million;

  • holders of general unsecured claims against the non-guarantor debtors will receive any cash available after payment of all senior claims; and

  • holders of old equity interests in General Maritime will receive no distribution on account of their interests.

    The plan provides for a record date of February 8, 2012 for determining generally the holders of general unsecured claims that are eligible to participate in the rights offering.

    Kramer Levin Naftalis & Frankel LLP is serving as legal advisor and Moelis & Company is serving as financial advisor to the Company.

    General Maritime Corporation is a crude and products tanker company operating principally within the Atlantic basin, which includes ports in the Caribbean, South and Central America, the United States, West Africa, the Mediterranean, Europe and the North Sea.

    Previously on abfjournal.com:

    Nordea Bank Agents $100MM DIP in General Maritime Restructuring, Friday, November 18, 2011