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 a rights offering described below. The company will continue to operate as a going concern and will reduce its funded indebtedness by approximately $600 million.
Under the plan:
- 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 the 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 percent of the new equity of the reorganized company on an undiluted basis;
- holders of general unsecured claims against General Maritime Corporation will receive their pro rata share of warrants to purchase 2.5 percent 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 percent 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 Corporation will receive no distribution on account of their interests.
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."
Mr. Pribor added, "Our stakeholders have helped us make significant progress in our financial restructuring and we look forward to building on our success and our strong business relationships in the months and years to come. I want to thank our vendors and customers for their loyalty and support, as well as our employees for their continued hard work and dedication.
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. In addition, holders of general unsecured claims who file a proof of claim after February 8, 2012 but before the general bar date of February 23, 2012, certain additional claims holders as described in the plan, and transferees of claims in accordance with the plan may also be eligible to participate in the rights offering. The rights offering will be limited to those holders of general unsecured claims that are either qualified institutional buyers or accredited investors as defined by applicable securities laws.
The company says that discussions with the Creditors' Committee and certain other holders of Senior Note Claims are ongoing and the parties are hopeful that consensus on the plan will be reached.
The plan is subject to confirmation by the court.
The disclosure statement, which is available at www.gmrrestructuring.com, includes a historical profile of the company, a description of proposed distributions to creditors, and an analysis of the plan's feasibility, as well as many of the technical matters required for the solicitation process, such as descriptions of who will be eligible to vote on the plan and the voting process itself.
February 1, 2011