Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comCubic Energy Inc. files for Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman|February 9, 2016
Cubic Energy Inc. files for Chapter 11
Cubic Energy Inc. files for Chapter 11 Bankruptcy Protection
Cubic Energy Inc. files for Chapter 11
It has been announced that Cubic Energy Inc., one of the largest remaining oil companies in Texas, had filed for Chapter 11 bankruptcy protection. According to The Wall Street Journal, the company is just the latest to feel the brunt of the collapse of oil prices. As part of its bankruptcy plan, Cubic Energy will hand over control of the company in a debt-for-equity swap with Wells Fargo Energy Capital Inc., as well as with a portion of its secured lenders.
To explain its need for the bankruptcy filing, the company cited the historic 65 percent drop in oil prices in 2015 from $100 per barrel to $35. According to Market Watch, these prices dropped and remained low for the majority of 2015, and there is no certainty that OPEC will make any changes that could potentially boost oil prices in the near future. As a result, Cubic Energy joined more than 30 oil and gas exploration and production companies seeking Chapter 11 bankruptcy protection in recent months.
As a result of its financial shortcomings at the tail end of 2014, Cubic Energy has looked to sell the firm and its assets for over a year. In its court documents, the company listed assets of $120.7 million and debts of $126.4 million in debt, with $29.9 million owed to Wells Fargo.
Cubic Energy reached an agreement with its lenders on a pre-packaged bankruptcy plan. The Wall Street Journal reported that a majority of its creditors led by Wells Fargo will receive equity shares in the company in exchange for relief from the debt total owed to them. Wells Fargo will also gain ownership of the company’s Louisiana holdings valued at $10 million, while Anchorage Capital Group LLC, Corbin Capital Partners LP and O-CAP Management LP will take control over the remaining company assets worth approximately between $46 million to $76 million.
The company is seeking approval for several first day bankruptcy motions to maintain its current business operations. Its goal is to keep the business running until the sale is complete so as to not depreciate its asset or net worth. In its bankruptcy documents, Cubic Energy also stated that it intends to emerge from the bankruptcy period as a viable business, which makes its continuing business operations crucial.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
Cubic Energy Inc. files for Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman
It has been announced that Cubic Energy Inc., one of the largest remaining oil companies in Texas, had filed for Chapter 11 bankruptcy protection. According to The Wall Street Journal, the company is just the latest to feel the brunt of the collapse of oil prices. As part of its bankruptcy plan, Cubic Energy will hand over control of the company in a debt-for-equity swap with Wells Fargo Energy Capital Inc., as well as with a portion of its secured lenders.
To explain its need for the bankruptcy filing, the company cited the historic 65 percent drop in oil prices in 2015 from $100 per barrel to $35. According to Market Watch, these prices dropped and remained low for the majority of 2015, and there is no certainty that OPEC will make any changes that could potentially boost oil prices in the near future. As a result, Cubic Energy joined more than 30 oil and gas exploration and production companies seeking Chapter 11 bankruptcy protection in recent months.
As a result of its financial shortcomings at the tail end of 2014, Cubic Energy has looked to sell the firm and its assets for over a year. In its court documents, the company listed assets of $120.7 million and debts of $126.4 million in debt, with $29.9 million owed to Wells Fargo.
Cubic Energy reached an agreement with its lenders on a pre-packaged bankruptcy plan. The Wall Street Journal reported that a majority of its creditors led by Wells Fargo will receive equity shares in the company in exchange for relief from the debt total owed to them. Wells Fargo will also gain ownership of the company’s Louisiana holdings valued at $10 million, while Anchorage Capital Group LLC, Corbin Capital Partners LP and O-CAP Management LP will take control over the remaining company assets worth approximately between $46 million to $76 million.
The company is seeking approval for several first day bankruptcy motions to maintain its current business operations. Its goal is to keep the business running until the sale is complete so as to not depreciate its asset or net worth. In its bankruptcy documents, Cubic Energy also stated that it intends to emerge from the bankruptcy period as a viable business, which makes its continuing business operations crucial.
Are you a creditor in a bankruptcy? Have you been sued by a bankrupt? If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.
