NEW ORLEANS, July 13, 2017 /PRNewswire/ -- Tidewater Inc.
(NYSE: TDW) ("Tidewater" or the "Company") today announced that the
United States Bankruptcy Court for the District of Delaware (the "Court") has confirmed the
Second Amended Joint Prepackaged Chapter 11 Plan of Reorganization
of Tidewater and its Affiliated Debtors, originally dated
May 17, 2017 and amended on
July 12, 2017 and July 13, 2017 (the "Plan"). The Company
expects that Judge Brendan L.
Shannon will enter a written confirmation order within the
next few business days (the "Confirmation Order").
"We are very pleased that the court has confirmed our Plan
within a relatively short time frame," said Jeffrey M. Platt, Tidewater's President and
Chief Executive Officer. "The substantial deleveraging of our
balance sheet through the recapitalization contemplated by the
Plan, as well as our strong liquidity position, should reassure our
customer and vendor base of our ongoing ability to perform our
contracts and meet our obligations while we weather the continuing
headwinds in the offshore energy industry. Additionally, this
restructuring will position us to consider possible targeted
acquisition opportunities in an industry where consolidation is to
be expected. We are working hard to complete the remaining steps
necessary to emerge from bankruptcy by the end of this month.
Tidewater is thankful for the continued support of our many
stakeholders, including our lenders, noteholders, stockholders,
employees, customers, vendors and trade creditors. Their support
has been integral to the successful outcome of the chapter 11
process, and we look forward to emerging in the coming weeks as a
strong, well-capitalized company, poised to continue providing our
customers with the same safe, compliant and efficient services
which have been the hallmark of our Company throughout our
history."
The following is a summary of the material terms of the Plan.
This summary highlights only certain substantive provisions of the
Plan and is not intended to be a complete description of the Plan.
Capitalized terms used but not defined below have the meanings
ascribed to them in the Plan. Following the entry of the written
Confirmation Order, the Company will file a Current Report on Form
8-K with the Securities and Exchange Commission, which will include
the Plan and Confirmation Order as exhibits.
The Plan of Reorganization and Treatment of Claims and
Interests
The Plan contemplates the following treatment of claims against
and interests in the Debtors:
- The lenders under the Credit Agreement, the holders of Notes,
and the lessor parties (the "Sale Leaseback Parties") to certain
sale leaseback agreements (the "Sale Leaseback Agreements") holding
claims thereunder (collectively, the "General Unsecured Creditors"
and the claims thereof, the "General Unsecured Claims") will
receive their pro rata share of (a) $225
million of cash, (b) subject to the considerations discussed
below, common stock and, if applicable, warrants (the "New Creditor
Warrants") to purchase common stock, representing 95% of the pro
forma common equity in reorganized Tidewater (subject to dilution
by a management incentive plan and the exercise of warrants issued
to existing stockholders under the Plan as described below); and
(c) new 8% fixed rate secured notes due in 2022 in the aggregate
principal amount of $350 million (the "New Secured Notes").
The Company and the Sale Leaseback Parties are not in agreement
with respect to the allowed amount of claims of the Sale Leaseback
Parties (the "Sale Leaseback Claims"). Accordingly, on the
Effective Date, a portion of the cash, New Creditor Warrants, and
New Secured Notes referenced above, in an amount that the Company
believes represents the maximum possible distributions owing on
account of such disputed Sale Leaseback Claims, will be withheld
from distributions to General Unsecured Creditors and will be
distributed according to the terms of the Plan as such claims are
resolved. To the extent the Sale Leaseback Claims are resolved for
less than the amount withheld, the remainder will thereafter be
distributed to holders of allowed General Unsecured Claims pro
rata.
To assure the continuing ability of certain vessels owned by the
Company's subsidiaries to engage in U.S. coastwise trade, the
number of shares of the Company's common stock that would otherwise
be issuable to the allowed General Unsecured Creditors may be
adjusted to assure that the foreign ownership limitations of the
United States Jones Act are not exceeded. The Jones Act requires
any corporation that engages in coastwise trade be a U.S. citizen
within the meaning of that law, which requires, among other things,
that the aggregate ownership of common stock by non-U.S. citizens
within the meaning of the Jones Act be not more than 25% of its
outstanding common stock. The Plan requires that, at the time
Tidewater emerges from bankruptcy, not more than 22% of the
outstanding common stock will be held by non-U.S. citizens. To that
end, the Plan provides for the issuance of a combination of common
stock of reorganized Tidewater and the New Creditor Warrants to
purchase common stock of reorganized Tidewater on a pro rata basis
to any non-U.S. citizen among the allowed General Unsecured
Creditors whose ownership of common stock, when combined with the
shares to be issued to other General Unsecured Creditors and
existing Tidewater stockholders that are non-U.S. citizens, would
otherwise cause the 22% threshold to be exceeded. The New Creditor
Warrants will not grant the holders thereof any voting or control
rights or dividend rights, or contain any negative covenants
restricting the operation of the Company's business. Generally, the
New Creditor Warrants will be transferrable and will be exercisable
immediately at a nominal exercise price, subject to restrictions
contained in the Company's new certificate of incorporation
designed to assure the Company's continuing eligibility to engage
in coastwise trade under the Jones Act that prohibit the exercise
of such warrants where such exercise would cause the total number
of shares held by non-U.S. citizens to exceed 24% of the Company's
outstanding common stock. Tidewater will establish, under its
charter and through DTC, appropriate measures to assure compliance
with these ownership limitations.
- The Company's existing shares of common stock will be cancelled
as of the Effective Date. Existing common stockholders of Tidewater
will receive their pro rata share of common stock representing 5%
of the pro forma common equity in reorganized Tidewater (subject to
dilution by a management incentive plan and the exercise of
warrants issued to existing stockholders under the Plan) and
six-year warrants to purchase additional shares of common stock of
reorganized Tidewater. These warrants will be issued in two
tranches, with the first tranche (the "Series A Warrants") being
exercisable immediately, at an aggregate exercise price based upon
an equity value of the Company of approximately $1.71 billion, and the second tranche (the
"Series B Warrants") being exercisable immediately, at an aggregate
exercise price based upon an equity value of the Company of
$2.02 billion. The Series A Warrants
will be exercisable for a number of shares equal to 7.5% of the sum
of (i) the total outstanding shares of common stock after
completion of the transactions contemplated by the Plan, and (ii)
any shares issuable upon exercise of the New Creditor Warrants and
the Series A Warrants, while the Series B Warrants will be
exercisable for a number of shares equal to 7.5% of the sum of (x)
the total outstanding shares of common stock after completion of
the transactions contemplated by the Plan, and (y) any shares
issuable upon the exercise of the New Creditor Warrants, the Series
A Warrants, and Series B Warrants. Like the New Creditor Warrants,
the Series A Warrants and the Series B Warrants will not grant the
holders thereof any voting or control rights or dividend rights, or
contain any negative covenants restricting the operation of the
Company's business and will be subject to the restrictions in the
Company's new certificate of incorporation described above that
prohibit the exercise of such warrants where such exercise would
cause the total number of shares held by non-U.S. citizens to
exceed 24% of the Company's outstanding common stock.
- The undisputed claims of other unsecured creditors such as
customers, employees, and vendors, will be paid in full in the
ordinary course of business (except as otherwise agreed among the
parties).
Unless otherwise specified, the treatment set forth in the Plan
and Confirmation Order will be in full satisfaction of all
claims against and interests in the Debtors, which will be
discharged on the Effective Date. All of the Company's existing
common stock will be extinguished by the Plan.
Additional Information
Additional details about the restructuring are available on the
Company's website and at http://dm.epiq11.com/tidewater, or
via the Company's restructuring information line 844-843-0204 (toll
free) or 504-597-5543 (international calls).
Forward-Looking Statements
In accordance with the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, the Company notes that
certain statements set forth in this press release provide other
than historical information and are forward looking. The actual
achievement of any forecasted results, or the unfolding of future
economic or business developments in a way anticipated or projected
by the Company, involve numerous risks and uncertainties that may
cause the Company's actual performance to be materially different
from that stated or implied in the forward-looking statement. Among
those risks and uncertainties, many of which are beyond the control
of the Company, including, without limitation, the ability to
satisfy the conditions necessary to declare the Plan effective in
the anticipated timeframe; effects on the market price of the
Company's common stock and on the Company's ability to access the
capital markets; volatility in worldwide energy demand and oil and
gas prices, and continuing depressed levels of oil and gas prices,
without a clear indication of if, or when, prices will recover to a
level to support renewed offshore exploration activities;
consolidation of our customer base; fleet additions by competitors
and industry overcapacity; our views with respect to the need for
and timing of the replenishment of our asset base, including
through acquisitions or vessel construction; changes in capital
spending by customers in the energy industry for offshore
exploration, field development and production; loss of a major
customer; changing customer demands for vessel specifications,
which may make some of our older vessels technologically obsolete
for certain customer projects or in certain markets; delays and
other problems associated with vessel construction and maintenance;
uncertainty of global financial market conditions and difficulty in
accessing credit or capital; potential difficulty in meeting
financial covenants in material debt or other obligations of the
Company or in obtaining covenant relief from lenders or other
contract parties; acts of terrorism and piracy; integration of
acquired businesses and entry into new lines of business;
disagreements with our joint venture partners; significant weather
conditions; unsettled political conditions, war, civil unrest and
governmental actions, such as expropriation or enforcement of
customs or other laws that are not well developed or consistently
enforced, or requirements that services provided locally be paid in
local currency, in each case especially in higher political risk
countries where we operate; foreign currency fluctuations; labor
changes proposed by international conventions; increased regulatory
burdens and oversight; changes in laws governing the taxation of
foreign source income; retention of skilled workers; enforcement of
laws related to the environment, labor and foreign corrupt
practices; and the resolution of pending legal proceedings. Readers
should consider all of these risk factors as well as other
information contained in this press release.
Tidewater is the leading provider of Offshore Service Vessels
(OSVs) to the global energy industry.
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SOURCE Tidewater Inc.