The case is easy to misread. Disclosure-statement language, the confirmed plan, and later docket activity do not always match. A GUC trust described in one document, for example, is not the operative treatment in the confirmed plan.
This article covers why Zachry filed, the Golden Pass settlement, how the confirmed plan treats each class, and what creditors should check on the docket. It separates confirmed terms from earlier proposals and from later implementation.
Key Takeaways
- Zachry's filing grew out of Golden Pass LNG cost and payment disputes, and the settlement let it exit the project.
- The confirmed plan pays Class 6 general unsecured creditors through GUC Promissory Notes, not the earlier trust structure.
- Actual recovery depends on allowed claims, so check claim status on the docket.
- Confirmation (Feb. 27, 2025) and the effective date (April 10, 2025) are different events.
Why Zachry Filed Chapter 11
The business and the project
Zachry Industrial, Inc. (ZII) provides engineering, construction, maintenance, turnaround and fabrication services. On Golden Pass, ZII was lead contractor in the CCZJV joint venture with Chiyoda and CB&I.
Zachry Construction is a separate business. The first-day declaration states that no Zachry Construction entities are debtors, so don't confuse the two.
Fixed-price pressure
The first-day declaration (Dkt. 7, filed May 21, 2024) describes an amended fixed-price EPC contract exceeding $10 billion, with roughly $5.8 billion attributable to ZII and its joint-venture partners. Billings depended on Golden Pass approval of change orders.
These are debtor assertions, not court findings. The debtors cited:
- Inaccurate geological studies and adverse site conditions
- COVID-related labor, equipment and supply-chain disruption
- Inadequate or delayed change-order relief
The declaration does not establish an adjudicated overrun figure.
Cash-flow deterioration
Per the declaration:
| Period | Reported event |
|---|---|
| Before April 2024 | Expenses of about $30-40 million per week against progress payments of about $70 million per month |
| March 2024 | Golden Pass began paying vendors directly and recovered much of it from advance progress payments |
| April 2024 | Golden Pass stopped progress payments |
| May 8, 2024 | EPC default notice citing unpaid liens above $23.5 million; CCZJV issued its own notice under the HJVA |
| May 16-21, 2024 | Further default notice, then a standstill to the petition date |
Financing and liquidity
The prepetition credit agreement totaled $956.25 million. At filing, the declaration reported about $125 million in revolving loans, $156.25 million in term loans and $618.9 million in undrawn letters of credit, secured by first-priority liens.
The court's interim order (Dkt. 59, May 22, 2024) authorized cash collateral use under an approved budget with periodic budget-to-actual reporting. Adequate protection included replacement liens. The core first-day materials show no DIP facility, so this was a cash collateral case.
Case Snapshot and Key Timeline
- Court: U.S. Bankruptcy Court, Southern District of Texas, Houston Division
- Lead case: 24-90377, jointly administered; Judge Marvin Isgur
- Debtors: 19 entities, including Zachry Holdings, Zachry Industrial and Zachry Engineering (case numbers 24-90377 to 24-90395)
- General bar date (including 503(b)(9)): September 16, 2024, 5:00 p.m. Central
- Governmental bar date: November 18, 2024, 5:00 p.m. Central
| Date | Event |
|---|---|
| May 21, 2024 | Petitions and first-day declaration (Dkt. 7) |
| May 22, 2024 | Interim cash collateral order (Dkt. 59) |
| July 25, 2024 | Interim settlement order (Dkt. 625) |
| July 26, 2024 | Bar date order (Dkt. 636) |
| Aug. 12, 2024 | Final Golden Pass settlement order (Dkt. 744) |
| Jan. 23, 2025 | Disclosure statement (Dkt. 1986) |
| Feb. 23, 2025 | Further modified amended plan (Dkt. 2362) |
| Feb. 26, 2025 | Fifth plan supplement (Dkt. 2417) |
| Feb. 27, 2025 | Confirmation order (Dkt. 2431) |
| Apr. 10, 2025 | Effective date notice (Dkt. 2731) |
Zachry's own release says the court confirmed the plan on February 26. The entered confirmation order is dated February 27, which is the date to cite.
Confirmation is the court's approval. The effective date is when the plan is implemented after its conditions are satisfied or waived. Dkt. 2731 records that date as April 10, 2025. Where secondary summaries conflict with the docket, the primary filings control.
How the Golden Pass Settlement Shaped the Reorganization
Purpose and terms
The settlement let Zachry exit its lead-contractor role while Golden Pass and its partners continued the project. In a later opinion (Dkt. 1266, Oct. 29, 2024), the court described it as resolving disputes among the Golden Pass owners, settling levee-failure claims and facilitating project completion.
Under the final order (Dkt. 744):
- Golden Pass agreed to pay covered valid unpaid ZII obligations for project work, subject to a cap
- Debtors transferred project-site equipment interests to Golden Pass, with lien releases from the prepetition agent
- Specified letter-of-credit draws and cancellation mechanics were authorized
- Releases were approved and the adversary proceeding was to be dismissed with prejudice
The public order text does not disclose the cap or draw amounts.
Rejection and releases
The EPC contract and HJVA were rejected under section 365. The order states that rejection does not create rejection-damages claims against the estates, which removed a potentially large category of claims.
The court said CB&I and Chiyoda released Zachry from $93 million in liabilities and Golden Pass released $1.4 billion. Those are released liabilities, not cash proceeds or creditor recoveries.
Why it mattered to the plan
The settlement cut litigation risk, separated Zachry from construction operations and gave the estate a cleaner basis for claims reconciliation. Valid vendors and subcontractors gained a payment path through Golden Pass. Whether any given claim was ultimately paid depends on its own record. Project completion and rehiring outcomes should not be assumed from the settlement alone.
What the Confirmed Chapter 11 Plan Provides
Class treatment
| Class | Treatment |
|---|---|
| 1 Other Secured | Unimpaired |
| 2 Other Priority | Unimpaired; paid in full or per Code priority |
| 3 Prepetition Credit Facility | Impaired; about $281.25 million of principal handled through the exit facility |
| 4 Deferred Compensation | Unimpaired |
| 5 Convenience | Unimpaired; cash treatment |
| 6 General Unsecured | Impaired; GUC Promissory Notes plus specified postpetition interest |
| 7 Intercompany Claims | Reinstated, converted, settled or cancelled by election |
| 8 Intercompany Interests | Reinstated or cancelled by election |
| 9 Zachry Interests | Reinstated and unimpaired |
GUC trust versus GUC notes
The January 2025 disclosure statement described a liquidating GUC Trust. The confirmed plan instead issues notes to Class 6 holders. Don't treat the trust's reserve and distribution mechanics as operative. A class recovery percentage is not readily available from the disclosure statement, so no recovery figure should be assumed.
GUC note terms
The amended term sheet (Dkt. 2122-1, filed Feb. 11, 2025) was labeled "Draft as of February 11" and subject to revision. Check executed documents. As filed:
- Principal equals allowed GUC claims plus postpetition interest at the federal judgment rate
- Interest is 15% per year: 7.5% cash, paid quarterly, and 7.5% PIK added to principal
- Maturity is the first business day after 91 days following the Exit Revolving Maturity Date
- The lien is junior to the A&R credit facility and permitted Sunbelt-related deferred-payables debt
This describes document terms and is not investment advice.
Exit facility, GPX claims and releases
The plan provides an amended and restated exit facility and an Exit Intercreditor Agreement among the A&R facility agent, Sunbelt (as lender under its promissory note) and the GUC Note Collateral Agent. The exit facility amount is not stated in the available plan excerpts.
Allowed GPX claims unpaid by the effective date are to be paid by Golden Pass under the GPX Settlement. The plan includes third-party release opt-out procedures, and non-creditor employees were excluded from the third-party release and sent an Employee Letter.
Implications for Creditors and Other Stakeholders
What drives recovery
Allowed status is the gate. Distributions generally follow within 30 days after a claim is allowed, and a GUC Note goes to the administrative agent within 10 business days after a disputed claim is allowed. Bar dates and rejection deadlines (the later of the bar date or 30 days after the rejection order) decide whether a claim counts at all.
By stakeholder
- Vendors and subcontractors: Check whether the claim falls under the Golden Pass settlement's valid-obligation payment path or Class 6.
- Secured lenders: Treatment runs through the exit facility and intercreditor structure.
- General unsecured creditors: Expect GUC Notes only on allowed claims.
- Employees: Review the Employee Letter and release exclusion.
- Equity holders: Zachry Interests were reinstated.
- Governmental units: The bar date was November 18, 2024.
Claims agent
Verita Global (formerly KCC) runs the case site, claims register and notices at veritaglobal.net/ZHI. Confirm current contact details there.
Verita's index shows claims-objection activity and a July 2025 final-decree item for certain cases. That is not evidence that every affiliated case or claim matter closed. This article is informational, so consult qualified bankruptcy counsel about claim preservation, releases and distributions.
How to Research and Monitor the Zachry Case
Status as of October 20, 2026. Verify anything time-sensitive against the docket.
Document checklist
- Petition and first-day declaration (Dkt. 7)
- Cash collateral order (Dkt. 59)
- Interim and final settlement orders (Dkt. 625, 744)
- Bar date order (Dkt. 636)
- Disclosure statement (Dkt. 1986)
- Plan (Dkt. 2362), plan supplement (Dkt. 2417) and confirmation order (Dkt. 2431)
- GUC note term sheet (Dkt. 2122-1) and executed note documents
- Effective date notice (Dkt. 2731)
Tracking later activity
Watch for amended schedules, claim objections, distribution notices, effective-date filings, appeals and post-confirmation orders. Verita and PACER are the primary sources.
Professionals who monitor many cases can use BankruptcyData's coverage, which spans filings, case activity, plans, recoveries, and outcomes. It also offers docket tracking, capital structure and stakeholder views, alerts, and 45+ years of U.S. filing history. It supplements primary filings and does not replace them.
Frequently Asked Questions
Who owns Zachry Group?
Court and company materials do not identify ultimate owners. The plan reinstated "Zachry Interests" without naming holders. Zachry Group and Zachry Holdings are separate from Zachry Construction.
What is Zachry Group's revenue?
The ENR 2025 Top 400 lists Zachry Group at $5,932.5 million in 2024 construction revenue. That is an industry-ranking figure, not audited revenue, and not a 2025 number.
Who is the CEO of Zachry Group?
Zachry's February 26, 2025 release names John B. Zachry as Chairman and CEO of Zachry Holdings, Inc. That is accurate as of the release date; confirm current status.
What is Zachry Company?
Zachry Company is not one of the 19 debtor names and is not defined as a single legal entity in the filings. Clarify whether the reference means Zachry Holdings, Zachry Industrial, or the separate Zachry Construction.
