News Release

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Azure Midstream Partners, LP Announces Effectiveness of Plan of Liquidation

Dallas, June 2, 2017 – As previously disclosed, on May 19, 2017 the United State Bankruptcy Court for the Southern District of Texas, Houston Division (the “Court”) approved Azure Midstream Partners, LP,’s (the “Partnership” and together with its general partner and direct and indirect subsidiaries, “Azure” or “Debtors”) Fifth Amended and Restated Plan of Liquidation (the “Plan”) filed with the Court on May 18, 2017, Case No. 17-30461 (“Confirmation Order”). On June 2, 2017, all conditions to the occurrence of the effective date (the “Effective Date”) set forth in the Plan and Confirmation Order were satisfied or waived in accordance therewith and the Effective Date occurred. On the same date, the Partnership filed a notice of Effective Date of the Plan with the Court.

As previously disclosed on January 30, 2017, Azure filed voluntary petitions with the Court under chapter 11 of title 11 of the U.S. Bankruptcy Code.

In accordance with the Plan, as of the Effective Date all common units have been cancelled without consideration and an entity formed pursuant to the Plan (the “Azure Custodian”) holds a single new unit of the Partnership’s common units as custodian for the benefit of the former unitholders, consistent with such unitholders’ former relative priority and economic entitlements. Awards granted and vested under the partnership’s 2013 long term incentive plan will be converted into the right to receive the amount, if any, they would be entitled to as holders of the equivalent number of common units vested and issued as of April 28, 2017. Also as of the Effective Date, all of the Partnership’s direct and indirect subsidiaries have been merged with and into the Partnership with the Partnership being the sole survivor of the merger. As soon as practicable and in accordance with the Plan, Azure’s corporate existence will be terminated.

Under the terms of the Plan, a portion of the allowed, secured claims arising under Debtors’ prepetition credit agreement (the “Secured Claims”) shall continue to be paid pursuant to the Plan and, thereafter, the Debtors shall pay all allowed tax claims, administrative expense claims, professional fees and expenses, general unsecured claims, and any costs associated with winding down the Debtors’ estates. After such claims have been paid in full, any remaining cash will be used to first satisfy the remainder of allowed Secured Claims. If any cash remains in the Debtors’ estates after satisfying the prepetition Secured Claims and all other allowed claims, and after liquidating the all remaining assets of the Debtors’ estates, the Plan provides that Azure Custodian shall receive all such remaining cash, which will be distributed on a pro rata share to the common unitholders. As previously disclosed, it is unlikely that any common unitholders will receive any distributions.

Copies of the Plan, the Court’s order confirming the Plan and Azure’s notice of Effective Date of the Plan are available at Going forward, Azure will post press releases, if any, on the kccllc site as it plans to discontinue its use of the site in the near future. We urge you to continue monitoring the kccllc website for important information and future press releases, if any, going forward.

Cautionary Note Regarding Forward Looking Statements

This press release includes "forward-looking statements" as defined by the Securities and Exchange Commission. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Partnership expects, believes or anticipates will or may occur in the future are forward-looking statements. Terminology such as "will," "would," "should," "could," "expect," "anticipate," "plan," "project," "intend," "estimate," "believe," "target," "continue," "potential," the negative of such terms or other comparable terminology are intended to identify forward-looking statements. These statements include, but are not limited to, the consummation of the Plan and the Partnership's expectations and anticipated results with respect thereto. These statements are based on certain assumptions made by the Partnership based on its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances, but such assumptions may prove to be inaccurate. Such statements are also subject to a number of risks and uncertainties, many of which are beyond the control of the Partnership, which may cause the Partnership's actual results to differ materially from those implied or expressed by the forward-looking statements. These include risks and uncertainties relating to, among other things: the ability to consummate the Plan; the ultimate receipt of proceeds and the application and distribution of proceeds, which are subject to a number of contingencies and uncertainties; and no assurance can be made that distributions will not be made if claims by creditors are less than currently anticipated or proceeds ultimately received by the partnership are greater than currently expected. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements in this press release are qualified in their entirety by these cautionary statements. Except as required by law, the Partnership undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.

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 Contact: Steven C. Sullivan, 518-587-5995