Out of Court Debt Restructures

The options for a financially distressed business mainly depend upon whether the business is viable and funds exist for restructuring or whether the financial or operational difficulties are intractable, making restructuring unfeasible.

For businesses that can be restructured, the two primary options include an out-of-court workout or filing for bankruptcy protection under Chapter 11. There are many choices for restructuring a business under either of these options. They include, among others, a sale of the business, a recapitalization, a consensual debt restructuring, or a non-consensual debt restructuring (e. g., a cramdown). Any or all of these options can be pursued (with the exception of the cramdown) through an out-of-court restructuring. Debtors often select the out-of-court option because the costs are considerably less than a Chapter 11 case and the process can be implemented and concluded much faster.

Snow Spence Green LLP has extensive experience handling all facets of analyzing, negotiating, drafting, and closing debt restructure agreements, workouts and recapitalizations. Because not all situations and cases are alike, "one size fits all" solutions rarely work well. Our attorneys' depth of experience with varying facts has allowed the Firm to use innovative strategies to maximize the restructure outcomes on a case by case basis.

Our lawyers have represented numerous creditor groups and debtors in connection with negotiation and documentation of debt restructure agreements and the associated transaction documents.

Representative Experience

The following are examples of engagements by firm attorneys within this area:

  • S. Lavon Evans, Jr. Operating Co., Inc., S. Lavon Evans Operating Texas, LLC, E&D Services, Inc., S. Lavon Evans, Jr. Drilling Ventures, LLC, Wausau Development Corporation and Long Leaf Pipeline, LP: Negotiation and documentation of terms of Debt Restructure Agreement and underlying security agreements, deeds of trust, and assignments between S. Lavon Evans, Jr. Operating Co., Inc. and its affiliates and a group of creditors.

  • JHP Operating, L.L.C., Henry Oil, L.C., D. John Henry, individually, and JMJH Land Services, Inc: Negotiation and documentation of the terms of a Debt Restructure Agreement and underlying security agreements and deeds of trust between JHP Operating, L.L.C., Henry Oil, L.C., D. John Henry, individually, JMJH Land Services, Inc., and a group of creditors.

  • Benz Energy, Inc. and its affiliate Texstar Petroleum, Inc.: Negotiation and documentation of the terms of a Debt Restructure Agreement and underlying security agreements, deeds of trust, and assignments between Benz Energy, Inc. and its affiliate Texstar Petroleum, Inc. and approximately 90 creditors aggregating approximately $12 million in debts.

  • Canadian Imperial Venture Corp. and its affiliate Imperial Venture Corp.: Negotiation and documentation of the terms of a Debt Restructure Agreement and underlying security agreements, mortgages, and assignments between Canadian Imperial Venture Corp. and its affiliate Imperial Venture Corp. and approximately 100 creditors aggregating approximately $11 million in debts.

  • Meridian Resources Corporation: Negotiation of potential debt restructure and underlying agreements between Meridian Resources Corporation and approximately 400 creditors aggregating approximately $34 million in debts. Necessity for implementation of agreement avoided by securing additional financing.

  • AFE Oil and Gas, LLC and Premium Resources II, L.P.: Negotiation and documentation of the terms of a Debt Restructure Agreement and underlying agreements between AFE Oil and Gas, LLC and Premium Resources II, L.P. and approximately 30 creditors aggregating approximately $900,000 in debts.

  • Reata Oil and Gas Corp. and Shield Petroleum Incorporated: Negotiation and documentation of the terms of a Debt Restructure Agreement and underlying agreements between Reata Oil and Gas Corp. and Shield Petroleum Incorporated and its trade creditors.