Foresight Energy LP ("Old Foresight") announced today that it has consummated its chapter 11 plan of reorganization (the "Plan").
In connection with consummation of the Plan on June 30, 2020 (the "Effective Date"), all of Old Foresight’s assets with exception of Foresight Energy LP, Foresight Energy GP LLC, and Foresight Energy LLC (but otherwise including such entities’ assets) were transferred to Foresight Energy Operating LLC, a newly formed Delaware limited liability company that is wholly-owned by Foresight Energy Resources LLC, a Delaware limited liability company. Foresight Energy LP, Foresight Energy GP LLC, and Foresight Energy LLC will be dissolved. Foresight Energy Resources LLC (together with its direct and indirect subsidiaries, "Foresight") is the new parent company for Old Foresight’s non-dissolving subsidiaries and go-forward business.
Pursuant to the Plan, Foresight discharged over $1 billion of indebtedness and eliminated approximately $94 million of anticipated annual cash interest payments, plus additional reductions in annual cash flow expenses through modified contractual terms with key logistics, mineral interest, and vendor counterparties. Holders of Old Foresight’s limited partnership units received no recovery under the Plan. Additionally, pursuant to the Plan, Foresight has emerged from chapter 11 with only $225 million in secured exit facility loans (the "Exit Facility"), $75 million of which will convert to equity 60 days following the closing of the Exit Facility, and will have approximately $65 million in cash liquidity.
"We are thankful to our many stakeholders, including our creditors, employees, customers, vendors, trade creditors, and key contract counterparties, for their continued support. With their cooperation, we have been able to implement our reorganization plan within four months of entering chapter 11. As a result of this support, we have achieved a capital structure that provides our very productive and low cost mining operations the ability to aggressively compete domestically and globally in a very competitive coal market. We look forward to the future under our new ownership and capital structure," said Robert D. Moore, Chief Executive Officer.
Foresight’s Plan and the order of the Court confirming the Plan were previously provided in a Current Report on Form 8-K to be filed with the Securities and Exchange Commission (the "SEC") on June 24, 2020, which can be viewed on the SEC’s website at http://www.sec.gov. Additional information is available by calling (833) 991-0977 (toll free) or (503) 597-7679 (international). Court filings and other information related to the court-supervised proceedings are available at a website administered by Foresight’s claims agent, Prime Clerk LLC, at https://cases.primeclerk.com/foresightenergy.
Foresight is a leading producer and marketer of thermal coal controlling nearly 2.1 billion tons of coal reserves in the Illinois Basin. Foresight operates three longwall mining complexes with four longwall mining systems and the Sitran river terminal on the Ohio River. With the resumption of longwall mining at Hillsboro, Foresight has idled continuous miner production at its Macoupin complex. Foresight’s operations are strategically located near multiple rail and river transportation access points, providing transportation cost certainty and flexibility to direct shipments to the domestic and international markets. Foresight is headquartered in St. Louis, Missouri.
Cautionary Statement Regarding Forward-Looking Statements
Statements contained in this press release, and oral statements made from time to time by our representatives, that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements made in good faith that are subject to risks, uncertainties and assumptions. These forward-looking statements are based on our current beliefs, intentions, and expectations. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions, future events or performance (often, but not always identifiable by the use of the words or phrases such as "will result," "expects to," "will continue," "anticipates," "plans, "intends," "estimated," "projects," "target," "goal," and "outlook") are not historical facts and may be forward-looking and, accordingly, such statements involve estimates, assumptions and uncertainties which could cause actual results to differ materially from those expressed in these forward-looking statements. Our actual results, performance or achievements could differ materially from those we express in the foregoing discussion as a result of a variety of factors. We have discussed many of these factors in more detail in our Annual Report on Form 10-K for the year ended December 31, 2019, including under the heading "Risk Factors" in Item 1A. In addition, our actual results could be affected by the risks and uncertainties relating to the Plan, including but not limited to, (i) the ability of the Company and its subsidiaries to achieve the expected benefits of the transactions contemplated by the Plan, (ii) the effects of the Company’s bankruptcy on the Company and on the interests of various constituents, (iii) the Company’s ability to maintain customer and/or vendor relationships that are essential to the Company’s operations, and (iv) the Company’s ability to retain key executives and employees. These factors are not necessarily all the important factors that could affect us. Other unpredictable or unknown factors could also have material adverse effects on actual results of matters that are the subject of our forward-looking statements. All forward-looking statements speak only as of the date on which they are made and we undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. We advise readers that they should (1) recognize that important factors not referred to above could affect the accuracy of our forward-looking statements and (2) use caution and common sense when considering our forward-looking statements.