8-K 1 d80913e8-k.txt FORM 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 October 1, 2000 -------------------------------------------------------------------------------- Date of Report (Date of earliest event reported) COSTILLA ENERGY, INC. -------------------------------------------------------------------------------- (Exact name of registrant as specified in its character) Delaware 0-21411 75-2658940 -------------------------------------------------------------------------------- (State or other (Commission File Number) (IRS Employer jurisdiction) Identification No.) 400 West Illinois, Suite 1000 Midland, Texas 79701 -------------------------------------------------------------------------------- (Address of principal executive offices) (915) 683-3902 -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) N/A -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Page 1 of 4 2 ITEM 3. BANKRUPTCY OR RECEIVERSHIP Debtor's Plan of Reorganization (Liquidation), Restated to Reflect All Amendments and Modifications (the "Chapter 11 Plan") of Costilla Energy, Inc. (the "Company") in its bankruptcy proceeding styled In Re Costilla Energy, Inc., Case No. 99-70653 in the United States Bankruptcy Court for the Western District of Texas, Midland Division, became effective on October 1, 2000 (the "Effective Date"). A copy of the Chapter 11 Plan is attached hereto as Exhibit 99.1. The Bankruptcy Court approved the Chapter 11 Plan by its Order Confirming Debtor's Plan of Reorganization (Liquidation), as Restated to Reflect All Amendments and Modifications entered on September 15, 2000, which became final on September 25, 2000. Substantially all of the oil and gas assets of the Company were sold on June 15, 2000. Accordingly, the material features of the Chapter 11 Plan relate to the distribution of the proceeds from that sale, the creation of a liquidating trust, and the cancellation of all of the equity interests of the Company. With respect to the distribution of the sale proceeds, the estimated recovery for the various classes of claims under the Chapter 11 Plan as set forth in the Disclosure Statement with respect to Debtor's Plan of Reorganization (Liquidation), as Amended (the "Disclosure Statement"), are as follows (assuming net proceeds available for distribution of approximately $116,000,000 as provided in the Disclosure Statement and other assumptions provided therein): secured claims, 100%; administrative and priority claims, 100%; administrative convenience unsecured claims, 100%; general unsecured claims including the Company's 10 1/4% Senior Notes due 2006, 44%; and equity interests, 0. The amount available for distribution is subject to adjustment related to post-confirmation liquidation expenses and activities. The Chapter 11 Plan creates the Costilla Liquidating Trust, and by operation of the confirmation order, the Trust takes possession and title to all of the Debtor's property. A plan trustee has been appointed as provided in the confirmation order and has the power and authority to complete the liquidation of the remaining assets of the Company, including without limitation, the prosecution of claims, objections, preferential transfer claims and other lawsuits. The plan trustee is further authorized to take any action on behalf of the Company that would otherwise require the approval of shareholders, directors or officers of the Company without obtaining such approval. The Chapter 11 Plan provides that the officers and directors of the Company have no further duties or responsibilities after the Effective Date, and all of the officers and directors of the Company resigned prior to the Effective Date. The Chapter 11 Plan also provides for the creation of a separate directors' and officers' litigation trust with a separate trustee to investigate and pursue, if appropriate, any claims that the Company may have against its former officers and directors. All of the outstanding equity interests of the Company, including the Company's common stock and preferred stock and any options or other rights related thereto, were cancelled pursuant to the terms of the Chapter 11 Plan as of the Effective Date. Holders of equity interests are not entitled to any distributions under the Chapter 11 Plan, unless all of the creditors are paid in full, with interest, and all of the costs and expenses of the trusts have been paid. Any such distribution would be made to the shareholders of the Company as of the Effective Date in the order of the rights of such shareholders (i.e., first, to the preferred shareholders, and then, to the common shareholders). There were 50,000 shares of the Company's preferred stock and 14,101,580 shares of the Company's common stock outstanding on the Effective Date. The Company believes that it is very unlikely that any distributions will be made to the holders of equity interests of the Company. Page 2 of 4 3 The following is a statement of assets and liabilities (identified by type and class under the Chapter 11 Plan) based on unaudited financial information as of June 30, 2000 as presented in the Disclosure Statement: STATEMENT OF ASSETS (in thousands)
Preliminary Balance Sheet June 30, 2000 % Plan (unaudited) Recovery Liquidation Cash and cash equivalents $114,884 100% $114,884 Accounts Receivable-Trade, net 582 40% 233 Accounts Receivable-Oil & Gas Sales -- 0% -- Prepaids 370 0% -- Total Current Assets 115,836 115,117 Oil & Gas Properties, net -- 0% -- Other Property & Equipment, net 1,800 10% 180 Gas Balancing Receivable -- 0% -- Other Assets, net 12,580 0% -- Title Defects Escrow 2,020 32% 646 Total Assets $132,236 $115,943 Net Proceeds Available for Distribution $115,943
ALLOWABLE CLAIMS OF SECURED, ADMINISTRATIVE, PRIORITY AND UNSECURED CLAIMANTS (in thousands)
Allowable Claims Secured Creditor Claims: Class 1: Banker's Trust Revolver $ 845 Class 2: Banker's Trust Hedging Obligation 19,462 Class 3: Dawson 525 Class 4: Other Secured Claims 749 Non-default interest at 6-30-00 1,020 Default interest at 6-30-00 655 ---------- Subtotal $ 23,256
Page 3 of 4 4 Administrative & Priority Claims: Trust Professional Fees $ 1,800 Chapter 11 Professional Fees 1,200 Transaction Fee on Sale 1,250 Post-Petition Creditors 2,500 General and Administrative 1,200 Priority Tax Claims -0- ---------------- Subtotal $ 7,950 Unsecured Claims: Class 5: Allowed Priority Non-Tax Claims $ -0- Class 6: Administrative Convenience Claims 354 Class 7: General Unsecured including Bonds 189,346 Class 8: Disallowed Claims, etc. 15,601 --------------- Subtotal $ 205,301 Class 9: Equity $ -0-
ITEM 7. FINANCIAL STATEMENT, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (c) Exhibits 99.1 Debtor's Plan of Reorganization (Liquidation), Restated to Reflect all Amendments and Modifications 99.2 Order Confirming Debtor's Plan of Reorganization (Liquidation), as Restated to Reflect all Amendments and Modifications SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. COSTILLA ENERGY, INC. Dated: October 12, 2000 By: /s/ Bobby W. Page ---------------------------------- Bobby W. Page, Liquidating Trustee Page 4 of 4 5 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------ ----------- 99.1 Debtor's Plan of Reorganization (Liquidation), Restated to Reflect all Amendments and Modifications 99.2 Order Confirming Debtor's Plan of Reorganization (Liquidation), as Restated to Reflect all Amendments and Modifications