Cypress Energy Partners (CELP) Seeks Chapter 11 Protection, Signs Restructuring Deal
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Today, Cypress Environmental Partners, LP (NYSE: CELP) announced that it filed for Chapter 11 bankruptcy protection and reached a restructuring support agreement with its priority senior secured lender, an affiliate of Argonaut Private Equity (“Argonaut”), that is expected to clear approximately $58 million worth of debt. The petition was filed in the US Bankruptcy Court for the Southern District of Texas, Houston division. Paul Hastings LLP is serving as legal counsel.
Judge Isgur entered a series of interim orders on “first day” motions that will facilitate Cypress’s continued normal business operations and reorganization efforts, including continuing to pay employee wages and other obligations. In addition, the Court heard Cypress’s emergency scheduling motion and set a hearing date of June 21, 2022 to consider both Cypress’s prepetition solicitation and confirmation of its prepackaged plan of reorganization.
Cypress also secured a $5 million debtor-in-possession financing facility from Argonaut that, combined with cash from operations, would provide enough liquidity during the Chapter 11 proceedings to continue business as usual. The facility is subject to court approval.
“With this important first step, we hope to have our plan confirmed before the end of June to allow our valuable employees to no longer be distracted so that they may solely focus on serving our customers,” said Peter C. Boylan III, Chairman, President and CEO of Cypress.
Cypress filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code on May 8, 2022, in the United States Bankruptcy Court for the Southern District of Texas, Houston Division. The case number is 22-90039. More information about Cypress’s Chapter 11 filing is available on the Internet at http://www.kccllc.net/Cypress including the “first day” motions, related orders and other court filings. The NYSE filed a Form 25 with the SEC on May 9, 2022 to de-list our units. Cypress plans to file a Form 15 to de-register the units on May 19, 2022.