| Item 1.01 | Entry into a Material Definitive Agreement. |
As previously reported by PetroQuest Energy, Inc. (“PetroQuest,” the “Company,” “we,” “our,” and “us”) on November 6, 2018 (the “Petition Date”), the Company, PetroQuest Energy, L.L.C. (“PQE”) and certain of our wholly-owned direct and indirect subsidiaries (collectively, the “Debtors”) filed voluntary petitions (the “Petition,” and the cases commenced thereby, the “Chapter 11 Cases”) seeking relief under Chapter 11 of Title 11 of the United States Code in the United States Bankruptcy Court for Southern District of Texas (the “Court”) to pursue a Chapter 11 plan of reorganization under the caption In rePetroQuest Energy Inc., et. al (CaseNo. 18-36322).
On January 14, 2019, the Company filed the Debtors’ First Amended Chapter 11 Plan of Reorganization, as Immaterially Modified as of January 14, 2019 (the “Modified Plan”) with the Court that incorporates the terms of a settlement among the Debtors, the Creditors’ Committee, and the Consenting Creditors whereby the Creditors’ Committee and the holders of the Hoog/Lee Litigation Claims (as defined below) agreed to support confirmation of the Modified Plan. Capitalized terms not otherwise defined herein have the meaning ascribed to them in the Modified Plan.
The Modified Plan provides, among other things, for the modification of the treatment of certain claims. Under the Modified Plan, holders of Allowed General Unsecured Claims will receive aggregate cash consideration of $1,200,000, to be distributed as follows:
| | • | | Holders of Allowed General Unsecured Claims (the “Convenience Subclass”) with a face amount equal to or less than $7,500 (the “Convenience Subclass Claims”) shall be entitled to a distribution equal to 50.0% of such Convenience Subclass Claim’s Allowed General Unsecured Claim. Holders of Allowed General Unsecured Claims in excess of $7,500 may elect, post-Effective Date, to reduce their Allowed General Unsecured Claim to $7,500 and receive treatment consistent with the Convenience Subclass Claims;provided,however, that holders of claims related to the Company’s 10% Second Lien Secured Senior Notes due 2021 and the Company’s 10% Second Lien Senior Secured PIK Notes due 2021 will not receive any distribution on account of their Allowed Second Lien Deficiency Claims;provided,further that, subject to the entry of an order authorizing the holders of the litigation claims arising fromKevin Hoog v. PetroQuest Energy, LLC et al., Case No.16-cv-00463, pending in the United States District Court for the Eastern District of Oklahoma andPhilip Lee v. PetroQuest Energy, LLC et al., Case No.16-cv-00516, pending in the United States District Court for the Eastern District of Oklahoma (the “Hoog/Lee Litigation Claims”) to file a class proof of claim on account of such claims, the aggregate portion of the General Unsecured Claims Distribution distributed to the holders of the Hoog/Lee Litigation Claims shall not exceed $400,000. |
| | • | | Holders of Allowed General Unsecured Claims with a face value greater than $7,500 who have not elected to be treated as a Convenience Subclass Claim shall receive theirpro rata share of the General Unsecured Claims Distribution Pool less (i) the funds distributed to holders of Allowed General Unsecured Claims in the Convenience Subclass and (ii) the reasonable out of pocket expenses of the GUC Administrator. |
A copy of the Modified Plan is attached as Exhibit 10.1 to this Current Report on Form8-K. The foregoing description of the Modified Plan is only a summary, does not purport to be complete, and is qualified in its entirety by reference to the Modified Plan.
1
