Each one in plain English, with the numbers worked through for a shareholder.
3 Mar 2017security holder rights change▼ BadMajor
The plan took effect on February 28, 2017, and all LinnCo common shares were cancelled and extinguished. LinnCo filed a Form 15 that day to end its SEC registration and will only wind up its affairs. The filing says there will be no distribution to shareholders on account of their shares, though they have a contingent right to tax-related distributions that may become available in the future from the liquidation. The company will stop filing regular reports, including the 2016 annual report, and file only 8-Ks on material wind-up events. This completes the cancellation foreshadowed by the plan confirmation.
On January 27, 2017, the bankruptcy court confirmed the Chapter 11 plan. The filing states that all of LinnCo's existing equity will be extinguished and each common share (251,644,889 outstanding as of October 31, 2016) cancelled when the plan takes effect, and that LinnCo will be wound down and liquidated. The company was targeting the effective date within 30 days but gave no assurance. This is the confirmation step of the plan path set out in the earlier restructuring agreements.
On October 21, 2016, Linn Energy signed an amended and restated Restructuring Support Agreement that adds certain credit facility lenders and replaces both the October 7 agreement and the May 10 bank agreement. The plan was filed with the court the same day. Bank lenders' claims are to be allowed as fully secured, with a cash paydown of $500 million plus other cash on hand and a take-back debt facility. The filing says most other terms are substantially identical to the original; it does not restate the treatment of LinnCo shares, which the earlier agreement said would be extinguished.
On October 14, 2016, the Linn debtors and some noteholders amended the October 7 Restructuring Support Agreement, moving the plan and disclosure statement filing deadline from seven to fourteen days after that agreement and the court approval date for the disclosure statement from December 6 to December 9, 2016. A Fourth Amendment to the bank agreement also moved its plan-filing deadline from 156 to 163 days after the petition date. The filing describes no change to the equity treatment.
On October 7, 2016, Linn Energy and its subsidiaries signed a new Restructuring Support Agreement with certain second lien and unsecured noteholders (the bank lenders were not yet parties). It states that all existing equity of LinnCo and Linn Energy would be extinguished without recovery, and sets out a $1.7 billion exit facility, $530 million of rights offerings and a plan-effective-date termination trigger of March 1, 2017. The same filing also reports a Third Amendment to the May 10 bank agreement, moving the plan-filing deadline from 149 to 156 days after the May 11 petition date (with a possible extension to 163 days).
On September 23, 2016 the debtors and some consenting creditors signed a second amendment to the Restructuring Support Agreement, extending the deadline to file the plan, solicitation materials and disclosure statement motion from 135 to 149 days after the May 11 petition date. This is a second deadline extension; the filing describes no change to plan terms.
On September 8, 2016 the debtors and some consenting creditors amended the May 10 Restructuring Support Agreement, pushing back the deadline to file the plan, solicitation materials and disclosure statement motion from 120 to 135 days after the May 11 petition date. The filing states only a deadline extension; no change to plan terms is described.
LinnCo reports completing the exchange offer on August 1, 2016: 123,909,317 Linn units (about 35% of outstanding) were accepted for exchange and LinnCo now owns about 71% of Linn's units. It plans to file financial statements and pro forma information by a later 8-K/A, within 71 calendar days of when this report was due. This repeats the offer result already reported in the final tender offer amendment.
The exchange offer closed on August 1, 2016 and this is the final amendment reporting results. In total 123,909,317 Linn units (about 35% of outstanding), 19,954,774 of them in the subsequent period, were accepted and LinnCo shares issued, leaving LinnCo owning about 71% of Linn's units. This ends the exchange offer thread; LinnCo remains a Chapter 11 debtor.
LinnCo extended the subsequent offering period again, to August 1, 2016. About 16,411,302 Linn units have now been tendered in that period, with new LinnCo shares issued for all of them, and LinnCo owns about 70% of Linn's units. The press release now shows LinnCo and Linn quoted over the counter (LNCOQ and LINEQ), consistent with the earlier delisting.
LinnCo extended the subsequent offering period of its Linn unit exchange offer to June 30, 2016. About 12,066,714 more Linn units were tendered in that period and new LinnCo shares were issued for them, bringing LinnCo's stake to about 68.9% of Linn's units. The press release says the court authorized the offer to continue on May 13, 2016, which settles the earlier open request for court approval, and that the offer aims to let Linn holders avoid future cancellation-of-debt income allocations.
NASDAQ told LinnCo on May 13, 2016 that its shares will be delisted, citing the Chapter 11 filing, concerns about the residual equity interest of existing shareholders, and the bid price having closed below $1.00 for 30 consecutive trading days. LinnCo does not intend to appeal, so trading on NASDAQ is to be suspended at the open on May 23, 2016, and the company expects the shares to be quotable on the OTC Pink, a more limited market that may be less liquid. This resolves the earlier minimum-bid warning with delisting rather than a cure.
LinnCo filed Amendment No. 4 to its tender offer statement, adding Prospectus Supplement No. 1 (May 12, 2016) and the May 11 press release as exhibits. The press release repeats the Chapter 11 filing and says the company has asked the court for approval to keep the exchange offer open through May 23, 2016, and that a bankruptcy plan would likely cause substantial cancellation of debt income. The amendment itself adds no new terms.
LinnCo, Linn Energy, certain Linn subsidiaries and Berry filed for Chapter 11 on May 11, 2016 in the Southern District of Texas, after signing a restructuring support agreement on May 10 with lenders holding at least 66.67% of the Linn and Berry credit facilities. The plan states that all existing equity interests of LinnCo, Linn Energy and Berry will be extinguished without recovery, which is the outcome the earlier filings had warned about. Plan terms include a new $2.2 billion Linn exit facility and conversion of unsecured claims to new equity.
