Morris Nichols Client TPC Secures Chapter 11 Plan Confirmation
In mid-2022 through early 2023, Morris Nichols, as co-counsel with Baker Botts, represented TPC Group Inc. and its affiliated debtors in successfully securing confirmation of the debtors’ Chapter 11 plan.
A Texas-based operator of a petrochemical processing plant and pipeline, TPC suffered setbacks after an explosion of one of its plants in 2019. On June 1, 2022, TPC filed for chapter 11 bankruptcy protection in Delaware with a restructuring support agreement in place.
Early in the chapter 11 cases, an ad hoc group of junior noteholders launched an adversary proceeding to challenge a series of prepetition transactions that rendered the group junior in the debtor’s capital structure relative to the debtor’s prepetition senior secured noteholders. This closely watched litigation represented a significant development in a cutting-edge area of the law and received significant press and industry coverage and analysis as a result.
The Honorable Craig T. Goldblatt held a summary judgment hearing on the inter-creditor dispute on June 29, 2022 and issued summary judgment in favor of the debtors and senior noteholders, which the junior noteholders appealed. Following the denial by the US District Court for the District of Delaware of the junior noteholders’ motion to stay Judge Goldblatt’s summary judgment order, the junior noteholders voluntarily dismissed the adversary proceeding and pending appeal.
Days after Judge Goldblatt’s order, the debtors returned to the Bankruptcy Court and obtained final approval of their DIP financing transaction after defeating all outstanding objections.
On November 30, 2022, the Bankruptcy Court confirmed the Debtors’ chapter 11 plan of reorganization. The plan restructured or eliminated more than $1 billion in secured debt, addressed substantial litigation claims against the debtors, and turned control of the private equity-backed company to the debtor’s prepetition senior secured noteholders. The debtors’ chapter 11 plan was the product of extensive negotiations between the debtors and their many stakeholders, including the official committee of unsecured creditors and counsel to nearly 10,000 plaintiffs pursuing claims against the debtors resulting from an explosion of the debtors’ plant.
Morris Nichols’ team was led by partners Rob Dehney, Curtis Miller, and Andrew Remming, together with senior counsel Dan Butz and associate Matt Talmo.