The Restructuring Support Agreement Clause Samples

The Restructuring Support Agreement. On August 6, 2014, after months of intensive negotiations, Eagle and a majority of holders of loans under the Prepetition Credit Facility, who hold substantially in excess of two-thirds of the principal amounts outstanding thereunder, entered into the Restructuring Support Agreement. The Restructuring Support Agreement bound the Consenting Lenders to support a restructuring, to be consummated through a prepackaged chapter 11 plan of reorganization, which would substantially reduce Eagle’s debt burden and solidify Eagle’s long-term growth and operating performance. Specifically, the parties agreed to support the Plan that embodied the terms set forth in a term sheet annexed to the Restructuring Support Agreement. These terms provided for the following: ● The Prepetition Credit Facility Lenders will receive 99.5% of the New Eagle Common Stock (subject to dilution) and the Prepetition Credit Facility Cash Distribution. ● Unimpairment of all General Unsecured Claims under section 1124 of the Bankruptcy Code. ● Equity Interests will be cancelled as of the Effective Date and holders of such Equity Interests will receive the Shareholder Equity Distribution, representing 0.5% of the New Eagle Common Stock (or, if applicable, the Shareholder Cash Distribution), and the New Eagle Equity Warrants, representing 7.5% of the New Eagle Common Stock (each, subject to dilution), which are being provided to holders of Equity Interests in exchange for the surrender or cancellation of their Equity Interests and for the releases by such holders of the Released Parties. This value is being provided to holders of Equity Interests solely from amounts that would otherwise be distributable to the Prepetition Credit Facility Lenders. ● Establishment of a Management Incentive Program that provides senior management and certain other employees with 2.0% of the shares of the New Eagle Common Stock and two tiers of stock options with staggered strike prices based on increasing equity values (each, on a fully diluted basis). Pursuant to the Management Incentive Program, no less than 2.5% of the shares of New Eagle Common Stock (on a fully diluted basis), subject to upward adjustment as may be agreed by the Debtor and the Majority Consenting Lenders prior to the Effective Date, will also be reserved for future issuances by the Reorganized Debtor to senior management and certain other employees of the Reorganized Debtor at the direction of the New Board. ● Entry into the Exit Financing Fac...