General Maritime Announces Agreement With Creditors

Press Release
Wednesday, March 28, 2012

New York - General Maritime Corporation announced that it had reached an agreement on a modified plan of reorganization with the Official Committee of Unsecured Creditors, funds managed by Oaktree Capital Management, L.P. and their investment entities and holders of more than 40 percent of the Company's Senior Notes. 

The Modified Plan is also supported by 66-2/3 percent of the Company's key senior lenders, including its bank group, led by Nordea Bank Finland plc., New York Branch as administrative agent. The Modified Plan will allow for a consensual reorganization of the Company, substantially deleverage the Company's balance sheet, provide a greater recovery to unsecured creditors, and position the Company to be a financially stronger, competitive global enterprise. 

"This is an important step to completing the restructuring process,” said Jeffrey D. Pribor, General Maritime's Chief Financial Officer. “ The Modified Plan, which is supported by our bank lenders, the Oaktree Funds and the Creditors' Committee, provides for enhanced recoveries for unsecured creditors and is designed to clear a path to confirmation. Through this restructuring, we are strengthening our balance sheet and improving our financial flexibility. We have made substantial progress, and we intend to continue working with our stakeholders to position General Maritime for long-term growth as a leading provider of international seaborne energy transportation services." 

Under the Modified Plan, the Company will no longer be implementing the previously announced rights offering. Instead, each class of claims or interests against the Company will receive the same or better treatment than under the original plan of reorganization. Holders  of allowed unsecured claims against the Company and its debtor subsidiaries which guarantee the Company's obligations under its secured facilities will share in $6 million in cash, warrants to purchase 3 percent of the equity in the reorganized company and 2 percent of the reorganized equity, increasing their estimated recovery from 0.75-1.88 percent under the original plan of reorganization to approximately 5.41 percent under the Modified Plan.  In addition, the Modified Plan resolves all disputes between the Company, the pre-petition senior lenders, the Oaktree Funds, certain large unsecured bondholders and the Creditors' Committee with respect to the original plan, thereby avoiding the expense and delay caused by a contested confirmation process.

The Modified Plan continues to provide for an infusion of $175 million in new capital from the Oaktree Funds. 

To facilitate the implementation of the agreed-upon restructuring, the Company, the Oaktree Funds, the Creditors' Committee, and holders of over 40 percent of the Senior Notes entered into a plan support agreement. The Bankruptcy Court agreed to hear a motion to approve the plan support agreement and modifications to the plan on April 2 at 10:00 a.m. ET.

Following the completion of the restructuring process, General Maritime will reduce its funded indebtedness by approximately $600 million and continue to provide international seaborne energy transportation services.   


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