8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of report (Date of earliest event reported): January 30, 2017, (January 27, 2017)

 

 

LINN ENERGY, LLC

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   000-51719   65-1177591

(State or other jurisdiction of

incorporation or organization)

   (Commission File Number)  

(I.R.S. Employer

Identification No.)

 

600 Travis

Houston, Texas

   77002
(Address of principal executive offices)   (Zip Code)

(281) 840-4000

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 1.03 Bankruptcy or Receivership

On May 11, 2016, Linn Energy, LLC (the “Company”), LinnCo, LLC (“LinnCo”), an affiliate of the Company, and certain of the Company’s direct and indirect subsidiaries (collectively with the Company and LinnCo, the “Debtors”), filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas (the “Court”). The Debtors’ Chapter 11 cases are being administered jointly under the caption In re Linn Energy, LLC, et al., Case No. 16-60040 (the “Chapter 11 Cases”).

On January 27, 2017, the Court entered the Order Confirming (I) Amended Joint Chapter 11 Plan of Reorganization of Linn Energy, LLC and its Debtor Affiliates Other Than Linn Acquisition Company, LLC and Berry Petroleum Company, LLC and (II) Amended Joint Chapter 11 Plan of Reorganization of Linn Acquisition Company, LLC and Berry Petroleum Company, LLC (the “Confirmation Order”), which approved and confirmed the Amended Joint Chapter 11 Plan of Reorganization of Linn Energy, LLC and Its Debtor Affiliates Other Than Linn Acquisition Company, LLC and Berry Petroleum Company, LLC (the “Plan”).

The Debtors expect that the effective date of the Plan will occur as soon as all conditions precedent to the Plan have been satisfied (defined in the Plan as the “Effective Date”). Although the Debtors are targeting occurrence of the Effective Date within the next 30 days, the Debtors can make no assurances as to when, or ultimately if, the Plan will become effective. It is also possible that technical amendments could be made to the Plan.

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. This summary is qualified in its entirety by reference to the full text of the Plan and the Confirmation Order, which are attached hereto as Exhibits 2.1 and 99.1, respectively, and incorporated by reference herein.

The Plan of Reorganization and Treatment of Claims and Interests

The Plan contemplates a restructuring of the Debtors through (a) rights offerings in the aggregate amount of $530 million backstopped by certain of the creditors (collectively, the “LINN Rights Offerings”) and open to all holders of allowed LINN Second Lien Notes Claims (as defined in the Plan) and all holders of allowed LINN Unsecured Notes Claims (as defined in the Plan); (b) a full recovery for the LINN Lenders (as defined in the Plan) consisting of (i) a $500 million cash payment from the proceeds of the LINN Rights Offerings and other cash payments from existing cash on hand, (ii) an exit facility in the aggregate amount of $1.7 billion (the “LINN Exit Facility”), or (iii) non-conforming term notes issued to those LINN Lenders who elect not to participate in the LINN Exit Facility; (c) the issuance of common stock in the reorganized Company (a new entity, the form of which shall be determined on or before the effective date of the Plan) to holders of the LINN Second Lien Notes Claims and the LINN Unsecured Notes Claims; (d) the right to participate in the LINN Rights Offerings for eligible holders of LINN Second Lien Notes Claims and LINN Unsecured Notes Claims; (e) a pro rata cash payment of $30 million to LINN Second Lien Noteholders (as defined in the Plan); (f) a full recovery for holders of Allowed LINN Convenience Class Claims (as defined in the Plan) and holders of LINN Allowed General Unsecured Claims (as defined in the Plan) who elect to reduce their LINN Allowed General Unsecured Claims (as defined in the Plan) to $2,500; and (h) a pro rata cash distribution from the LINN GUC Cash Distribution Pool (as defined in the Plan) to the holders of Allowed LINN General Unsecured Claims.

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 funded debt and equity will be extinguished by the Plan.

Additional information regarding the classification and treatment of claims and interests can be found in Article IV of the Plan.

Capital Structure

Pursuant to the Plan, each of the Company’s units outstanding immediately before the Effective Date (including any options and warrants to purchase such units) will be cancelled and of no further force or effect after the Effective Date. As of October 31, 2016, there were 355,032,380 units outstanding. Under the Plan, the Debtors’ new organizational documents will become effective on the Effective Date. The Company’s new organizational documents will authorize the Company to issue new equity, certain of which will be issued to holders of allowed claims pursuant to the Plan on the Effective Date. In addition, on the Effective Date, the Company will enter into a registration rights agreement with certain equityholders.

Settlement, Releases and Exculpations

The Plan incorporates an integrated compromise and settlement of claims to achieve a beneficial and efficient resolution of the Chapter 11 Cases. Unless otherwise specified, the settlement, distributions, and other benefits provided under the Plan, including the releases and exculpation provisions included therein, are in full satisfaction of all claims and causes of action that could be asserted.

The Plan provides releases and exculpations for the benefit of the Debtors, certain of the Debtors’ claimholders, other parties in interest and various parties related thereto, each in their capacity as such, from various claims and causes of action, as further set forth in Article VIII of the Plan.

Certain Information Regarding Assets and Liabilities of the Company

Information regarding the assets and liabilities of the Company as of the most recent practicable date is hereby incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2016, filed with the Securities and Exchange Commission on November 3, 2016.

 

Item 9.01 Financial Statements and Exhibits

 

  (d) Exhibits.

 

Exhibit

   

Description

2.1    Amended Joint Chapter 11 Plan of Reorganization of Linn Energy, LLC and Its Debtor Affiliates Other Than Linn Acquisition Company, LLC and Berry Petroleum Company, LLC
99.1    Order Confirming (I) Amended Joint Chapter 11 Plan of Reorganization of Linn Energy, LLC and its Debtor Affiliates Other Than Linn Acquisition Company, LLC and Berry Petroleum Company, LLC and (II) Amended Joint Chapter 11 Plan of Reorganization of Linn Acquisition Company, LLC and Berry Petroleum Company, LLC

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    LINN ENERGY, LLC
January 30, 2017     By:  

/s/ Candice J. Wells

      Candice J. Wells
      Senior Vice President, General Counsel and Corporate Secretary

EXHIBIT INDEX

 

Exhibit

   

Description

2.1    Amended Joint Chapter 11 Plan of Reorganization of Linn Energy, LLC and Its Debtor Affiliates Other Than Linn Acquisition Company, LLC and Berry Petroleum Company, LLC
99.1    Order Confirming (I) Amended Joint Chapter 11 Plan of Reorganization of Linn Energy, LLC and its Debtor Affiliates Other Than Linn Acquisition Company, LLC and Berry Petroleum Company, LLC and (II) Amended Joint Chapter 11 Plan of Reorganization of Linn Acquisition Company, LLC and Berry Petroleum Company, LLC