New Chapter 11 Filing - TerraVia Holdings Inc.

TerraVia Holdings Inc.

• 8/1/17 Recap: TerraVia, a publicly-traded (Nasdaq: $TVIA) "next-generation" algae-based food company based out of San Francisco filed for bankruptcy. The company has a stalking horse bidder lined up to buy it for $20mm plus certain assumed liabilities and seeks to jam this case through bankruptcy in about 6 weeks lest it run out liquidity in the process (even with a proposed $10mm DIP); it claims that more time is unnecessary given that it ran a robust marketing process pre-filing that included outreach to over 100 parties. We'll let the company economics do the rest of the talking (see below).
• Jurisdiction: (Judge Sontchi)
• Capital Structure: $144.2mm 5% '19 convertible senior subordinated notes (GLAS Trust Company LLC) & $33.475mm 6% '18 convertible senior subordinated notes (Wilmington Trust)   
• Company Professionals:
  • Legal: Davis Polk & Wardwell LLP (Damian Schaible, Steven Szanzer, Adam Shpeen, Benjamin Kaminetzky) & (local) Richards Layton & Finger P.A. (Mark Collins, Amanda Steele)
  • Financial Advisor: 
  • Investment Banker: Rothschild & Co. (Tero Janne)
  • Claims Agent: KCC (*click on company name above for free docket access)
• Other Parties in Interest:
  • DIP Agent: Wilmington Savings Fund Society FSB & Ad Hoc Consortium of Holders of Convertible Senior Subordinated Debt (Gilead Capital LP, Higher Ground SICAV PLC Core Wealth Fund, Lazard Asset Management LLC, Passport Capital LLC, Wolverine Asset Management LLC, Zazove Associates LLC)
    • Legal: Brown Rudnick LLP (Robert Stark, Steven Levine, Brian Rice, Kellie Fisher) & (local) Ashby & Geddes P.A. (William Bowden, Gregory Taylor, Katharina Earle)
    • Financial Advisor: GLC Advisors & Co. LLC
  • Passport Capital
    • Legal: Shearman & Sterling LLP (Joel Moss) & (local) Drinker Biddle & Reath LLP (Patrick Jackson)
  • 6% Notes Successor Trustee: Wilmington Trust NA
    • Legal: Katten Muchin Rosenman LLP (Craig Barbarosh, Karen Dine, Jerry Hall) & (local) Morris James LLP (Eric Monzo)
  • JV Partner: Bunge Global Innovation LLC
    • Legal: Jones Day (Joshua Morse)
  • Silicon Valley Bank
    • Legal: Troutman Sanders LLP (Harris Winsberg, Stephen Roach) & (local) Chipman Brown Cicero & Cole LLP (William Chipman Jr., Mark Olivere)
  • Corbion NV
    • Legal: Baker & McKenzie LLP (Debra Dandeneau, Frank Grese) & (local) Whiteford Taylor & Preston LLC (L. Katherine Good, Aaron Stulman)

Updated 8/26/17

First Day Declaration.

New Chapter 11 Filing - Lombard Public Facilities Corporation

Lombard Public Facilities Corporation

• 7/28/17 Recap: Illinois-based not-for-profit corporation formed to finance the cost of acquiring, designing, constructing, and equipping a conference center, hotel (Westin), restaurant and related improvements in the Village of Lombard filed for bankruptcy with a prearranged deal with its creditors. The corporation was funded via revenue bonds (A through C, with the A-2 bonds wrapped by an ACA Financial Guaranty Corporation policy) on the basis of a 2005 market study. Much like we saw with the Chapter 9 filing of The Kennewick Public Hospital District back in June, the study proved to be off the mark and the project has underperformed from the get-go. Some of this was bad timing: the project came online in August 2007: we all know what came shortly thereafter. The convention business the Project depended upon never came, rendering revenues insufficient and debt service payments difficult. Reserves set aside for the bonds were quickly depleted and the Project defaulted on the bonds. The Project enters bankruptcy with the A bonds as the declared fulcrum and a consensual restructuring in hand with each of ACA, holders of a majority of the bonds (here, Nuveen Asset Management LLC and OppenheimerFunds Inc.), and the hotel and restaurant managers, respectively. Taking it as given that Lombard is an "affluent" suburb of Chicago, you have to wonder why people thought this financing was a good idea. Lombard sounds quaint and all - with its annual Lilac Festival and parade - but there's nothing there, far as we can tell, that screams "convention business." Query how many Mom and Pop municipal bond investors are getting burned by this (seemingly) ill-advised financing. 
• Jurisdiction: N.D. of Illinois (Judge Cox) 
• Capital Structure: $246.65mm principal and interest municipal debt (Amalgamated Bank of Chicago)   
• Company Professionals:
  • Legal: Adelman & Gettleman, Ltd. (Henry Merens, Brad Berish, Alexander Brougham)
  • Financial Advisor: EisnerAmper LLP (Thomas Buck, Deborah Friedland, Allen Wilen)
  • Claims Agent: Epiq Bankruptcy Solutions LLC (click on case name above for free docket)
• Other Parties in Interest:
  • ACA Financial Guaranty Corp.
    • Legal: Greenberg Traurig LLP (Nancy Peterman)
  • Lord, Abbett & Co. LLC
    • Legal: Shaw Fishman Glantz & Towbin LLC (Peter Roberts)
  • Indenture Trustee: Amalgamated Bank of Chicago
    • Financial Advisor: FTI Consulting Inc.

Updated 7/28/17

New Chapter 11 Filing - Rent-a-Wreck of America, Inc.

Rent-a-Wreck of America, Inc.

• 7/24/17 Recap: When we saw that this company filed for bankruptcy, we were practically drooling. We immediately thought: the narrative had to be an Uber-is-to-blame story for a company like Rent-a-Wreck filing for bankruptcy, didn't it? And so we decided to cover it, despite its relatively small size, writing the following: In Silicon Valley, "disruption" is a buzzword that wide-eyed startup founders use to drum up excitement about their new venture, raise funding, and determine product/market fit. 79-90% of the time - depending on which data you rely on - those companies flame out. But sometimes they don't. And in the even rarer case that a startup doesn't just succeed but becomes a unicorn - or maybe even a decacorn a la Uber - that success is usually to the detriment of other incumbent companies. Take Rent-a-Wreck ("RAWA"). RAWA, through its wholly-owned opco, Bundy, sells and administers franchises for the operation of vehicle rental/leasing/sharing, among other automobile business lines. There are 76 RAWA franchises in 28 US states in addition to some international operations. The company makes its money from franchise fees, servicing fees, and insurance underwriting via a non-debtor insurance subsidiary. Or, we should say, MADE its money. EXCEPT, according to the company's First Day Declaration, this isn't an innovation/disruption story. It's a more mundane cash-flow-draining-litigation story. How disappointing. The company filed for bankruptcy to rightsize its franchise network, stop the bleed from litigation/judgments, streamline ops, and try to maximize the value of its intellectual property. It seeks a $750k DIP from its prepetition lender/equityholder to do so. What a waste of a solid Silicon Valley commentary. 
• Jurisdiction: D. of Delaware 
• Capital Structure: $2.47mm secured debt     
• Company Professionals:
  • Legal: Quarles & Brady LLP (Faye Feinstein, Christopher Combest) & (local) Saul Ewing LLP (Mark Minuti, Aaron Applebaum)
  • Claims Agent: KCC (*click on company name above for free docket access)
• Other Parties in Interest (no UCC appointed):
  • 100% Equity Owner & DIP Lender: JJF Management Services Inc.

Updated 8/26/17

New Chapter 11 Filing - Prospector Offshore Drilling S.a r.l.

Prospector Offshore Drilling S.a r.l.

• 7/20/17 Recap: So that was fast. Like lightening fast. Like if you blinked you may have missed it. Just two days ago Paragon Offshore emerged from bankruptcy and one of the debtors, Paragon Offshore plc, continues down the road of administration. But now it's effectively in bankruptcy again because of feasibility. No, no, just kidding on that. That would be TOO crazy. The issue here pertains to sale leaseback agreements with third-party lessors affiliated with SinoEnergy Capital Management Ltd. and related forbearance agreements that were entered into pre-bankruptcy to keep certain subsidiary entities out of the prior proceeding. Those subsidiaries are debtors here. The debtors intend to use the "breathing spell" provided by the bankruptcy automatic stay to negotiate a resolution to the disputes under the agreements with the third-party lessors. 
• Jurisdiction: D. of Delaware
• Company Professionals:
  • Legal: Weil Gotshal & Manges LLP (Gary Holtzer, Stephen Youngman, Christopher Lopez, Jessica Liou, Alfredo Perez, Clifford Carlson, Patrick Thompson) & (local) Richards Layton & Finger PA (Mark Collins, Amanda Steele)
  • Financial Advisor: AlixPartners LLP
  • Investment Banker: Lazard Freres & Co. LLC
  • Claims Agent: KCC (*click on company name above for free docket access)

Updated 8/8/17

New Chapter 11 Filing - Dynamic International Airways LLC

Dynamic International Airways LLC

• 7/19/17 Recap: North Carolina based "aviation enterprise" that services transportation between, among other places, JFK International Airport and so-called secondary cities like Nanjing China, filed for bankruptcy. The company is allegedly approved to fly to more Chinese cities than any other US-based carrier. Not too shabby for an "aviation enterprise" that, when described like that, sounds like it should be piloted by Pablo Escobar. The company pegs operational challenges including rapid management turnover as one cause of bankruptcy. Another is a series of lawsuits. Aside from a $6mm security interest, the capital structure consists of "unsecured debt" which sounds suspiciously like equity held primarily among the two principals, one of whom is providing a $6mm DIP. 
• Jurisdiction: MD of North Carolina
• Capital Structure: $6mm secured debt
• Company Professionals:
  • Legal: Garman Turner Gordon LLP (Gerald Gordon) & (local) Bell Davis & Pitt (Daniel Bruton)
  • Financial Advisor: MJAC LLC d/b/a Allison Consulting

New Chapter 11 Filing - Beaulieu Group LLC

Beaulieu Group LLC

• 7/17/17 Recap: Georgia-based carpet manufacturer filed for bankruptcy as consumers increasingly prefer hardwood flooring over carpets that remind them of a convalescent center. Consequently, the $10b market has gotten increasingly competitive and price compression is the result: the company's revenues have declined nearly 50% from $1b in 2007 to approximately $525mm in 2016. Recognizing these trends, the company commenced an operational restructuring in 2016 but with sustained overhead and a bloated cost structure, the company needs to do more. Its borrowing base, however, has decreased and the company, therefore, has run out of liquidity to continue pursuing its efforts. The company has arranged a $70mm DIP facility to facilitate a restructuring - the form of which is unspecified. 
• Jurisdiction: ND of Georgia 
• Capital Structure: $51.7mm RCF (Bank of America NA), $15.8mm TL (Cygnets LLC), $6mm third lien loan (CT Lender LLC) 
• Company Professionals:
  • Legal: Scroggins & Williamson PC (Robert Williamson, Ashley Reynolds Ray, Matthew Levin)
  • Financial Advisor: Armory Strategic Partners LLC (Scott Avila)
  • Investment Banker: Coveview Advisors LLC and Advisory Group Equity Services Ltd. (Thomas Canning)
  • Claims Agent: American Legal Claim Services LLC 
• Other Parties in Interest:
  • Prepetition & DIP Agent: Bank of America NA
    • Legal: Parker Hudson Rainer & Dobbs LLP (C. Edward Dobbs, James Rankin Jr.)
  • Official Committee of Unsecured Creditors
    • Legal: Fox Rothschild LLP (Michael Menkowitz, Paul Labov, Jason Manfrey, Marie Dooley) & (local) Thompson Hine LLP (John Isbell, Garrett Nail, John Allerding, Douglas Walters)
    • Financial Advisor: Phoenix Management Services LLC (Michael Jacoby, Bayard Hollingsworth, Pat Bellot)

Updated 9/21/17

New Chapter 11 Filing - Cocoa Services LLC

Cocoa Services LLC

• 7/14/17 Recap: The company is a (i) part of a vertically-integrated group of companies that supported supply chain for cocoa products and (ii) wholly-owned subsidiary of Transmar Commodity Group Ltd. ("TCG"), which previously filed for bankruptcy and is in the process of being sold and wound down. TCG was the company's largest customer so...well, the bankruptcy of one has effectively dominoed into the bankruptcy of another. The company intends to sell itself to an entity known as JB Cocoa Inc. And since there's nothing else particularly interesting about this case, we're going to pour ourselves some bowls of cocoa puffs. Just because. 
• Jurisdiction: S.D. of New York (Judge Garrity) 
• Capital Structure: $5.3mm debt (Bank of the West), $2mm unsecured note (assumed from Transmar).      
• Company Professionals:
  • Legal: Riker Danzig Scherer Hyland & Perretti LLP (Joseph Schwartz, Tara Schellhorn, Rachel Gillen) & (local) Klestadt Winters Jureller Southard & Stevens LLP (Tracy Klestadt, Joseph Corneau)
  • Financial Advisor/CRO: Deloitte CRG (Robert Frezza)
  • Claims Agent: Prime Clerk LLC (*click on company name above for free docket access)

Updated 8/8/17 

New Chapter 11 Filing - BICOM NY LLC

BICOM NY LLC

• 7/10/17 Recap: Manhattan based group of Jaguar, Maserati, Ford car dealerships filed for bankruptcy to trigger the automatic stay, prevent JPMorgan Chase from enforcing its rights as secured lender, and buy it more time to pursue a sale of the dealerships.  
• Jurisdiction: S.D. of New York (Judge Wiles)
• Capital Structure: $82mm debt (JPMorgan Chase Bank NA)    
• Company Professionals:
  • Legal: Wilk Auslander LLP (Eric Snyder, Eloy Peral)
  • Financial Advisor/CRO: Carl Marks Advisory Group LLC (Steven Agran) 
  • Claims Agent: JND Corporate Restructuring (*click on company name above for free docket access)
• Other Parties in Interest:
  • Prepetition & DIP Lender: JPMorgan Chase Bank NA
    • Legal: Sidley Austin LLP (Richard Fries, Andrew Propps, Kevin Lantry, Jeremy Rosenthal)

New Chapter 11 Filing - Morehead Memorial Hospital

Morehead Memorial Hospital

• 7/10/17 Recap: North Carolina non-profit 108-bed general acute care community hospital and owner of a 121-bed skilled nursing facility filed for bankruptcy. The healthcare provider noted the following reasons for the bankruptcy filing: (i) decreased patient volume, net revenue and free cash flow due, in large part, to the delivery of medical services occurring increasingly in ambulatory and emergency room settings; (ii) low reimbursement rates for medical services; (iii) expensive and only partially-reimbursed service in fulfillment of its non-profit mission; (iv) rising costs and increased competition (including competition for physicians given the hospital's rural nature); and (v) debt and legacy pension liability. The hospital will use the bankruptcy period to undertake both an operational and balance sheet restructuring while contemporaneously seeking a potential strategic healthcare provider partner. 
• Jurisdiction: M.D. of North Carolina (Judge Kahn)
• Capital Structure: $34mm debt     
• Company Professionals:
  • Legal: Waldrep LLP (Thomas Waldrep Jr., Jennifer Lyday, Francisco Morales)
  • Financial Advisor: Grant Thornton LLP (Scott B. Davis)
  • Investment Banker: Hanlon Hammond Camp LLC (Michael Lane)
  • Claims Agent: Donlin Recano & Company Inc. (*click on company name above for free docket access)

Updated 7/13/17 6:36pm CT

First Day Declaration

New Chapter 11 Filing - Foundation Healthcare Inc.

Foundation Healthcare Inc.

• 6/22/17 Recap: Once publicly-traded owner ($FDNH) and manager of surgical facilities that, at its peak, owned and/or managed 5 surgical hospitals, 9 ambulatory surgical centers and 3 outpatient departments in the Southeastern United States filed for bankruptcy to liquidate. Boom, done. 
• Jurisdiction: N.D. of Texas (Nelms)
• Company Professionals:
  • Legal: Husch Blackwell LLP (Vickie Driver, Christina Stephenson)
  • Financial Advisor/CRO: Ankura Consulting Group LLC (Michael Miller)
  • Claims Agent: Donlin Recano & Company Inc. (*click on company name above for free docket access)

Updated 7/11/17

New Chapter 11 Filing - Wordsworth Academy

Wordsworth Academy

• 6/30/17 Recap: Loyal PETITION readers know that we love lending snarky editorial color to chapter 11 filings. But sometimes things go beyond the pale and just aren't funny. This is one of them. This entity is a Pennsylvania non-profit corporation that provides education, behavioral health and welfare services to nearly 5,000 children who have emotional, behavioral and academic challenges. Why did it file? The company claims it needs an operational restructuring but there is a critical overhang here: a resident of one of the facilities died while being restrained. On top of that, there were other "allegations of other serious problems" at the same facility where the death occurred. There is an ongoing wrongful death suit against the company. Litigation appears to have pushed this company into bankruptcy, plain and simple. Tragic, sad, and definitely not amusing.
• Jurisdiction: E.D. of Pennsylvania
• Capital Structure: $4.7mm debt (M&T Bank)    
• Company Professionals:
  • Legal: Dilworth Paxson LLP (Lawrence McMichael, Peter Hughes, Anne Aaronson)
  • Financial Advisor: Getzler Henrich & Associates LLC (William H. Henrich)
  • Claims Agent: Donlin Recano & Company Inc. (*click on company name above for free docket access)
• Other Parties in Interest:
  • Secured Lender: M&T Bank 
    • Legal: Reed Smith LLP (Peter Clark II, Jennifer Knox)

Updated 7/11/17

New Chapter 11 Filing - True Religion Apparel Inc.

True Religion Apparel Inc.

• 7/5/17 Recap: Another private equity backed retailer files for bankruptcy. Here, the "brand that is globally recognized for innovative, trendsetting denim jeans and apparel" has a fast-tracked prepackaged deal with its lenders and private equity sponsor to shed approximately 72% of its debt and continue its operational restructuring (read: more store closures). The Manhattan Beach California 128-store retailer (down after closing 30 stores worldwide) blamed a (i) "a macro consumer shift away from brick-and-mortar to online retail channels," (ii) a decline in the premium denim market segment in the fashion industry and corresponding rise of athleisure, (iii) fast fashion, (iv) the rise in competitive discounting to make up for lost foot traffic and sales, and (v) an over-levered balance sheet. We believe that the decline is primarily attributable to cheesy AF bedazzled and bejeweled jeans with heinous a$$-designs and stitching that no one other than the cast of the Jersey Shore would want to be caught dead in. Its initial claim-to-fame is its "iconic and trademarked" horsesh*t symbol...we mean, "iconic and trademarked horseshoe symbol." Seriously, how is True Religion ONLY #15 on this list of "50 Men's Fashion Trends That Never Should Have Happened"? We're truly asking. Anyway, the de-levered and operationally stream-lined company hopes to restructure around a business plan predicated upon a global e-commerce expansion, increased licensing, deployment of pop-up outlet stores, an expansion of its "Last Stitch" line, and other shenanigans in an attempt to keep this ugly brand from filing for Chapter 22 after the holiday season. On an aside, the pop-up strategy is interesting: the company notes that the outlet concept has been profitable, primarily because they are based on short-term 18-month-or-less leases with "little downside" for the company. Yikes, landlords. The company further noted that the conversion of True Religion locations to "Last Stitch" branded locations has been successful. Curious. Doesn't this signal that the True Religion brand is, uh, kinda worth f*ck all and the company's success is dependent upon shying away from it? Hmmm. 
• Jurisdiction: D. of Delaware (Sontchi)
• Capital Structure: $60mm ABL (Deutsche Bank AG New York Branch), $400mm first lien TL (Delaware Trust Company, as successor to Deutsche Bank AG New York Branch), $85mm second lien TL (Wilmington Trust National Association, as successor to Deutsche Bank AG New York Branch)
• Company Professionals:
  • Legal: Pachulski Stang Ziehl & Jones LLP (Laura Davis Jones, David Bertenthal, James O'Neill)
  • Financial Advisor: Maeva Group LLC (Harry Wilson)
  • Claims Agent: Prime Clerk LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • Sponsor: Towerbrook Capital Partners LP
    • Legal: Wachtell Lipton Rosen & Katz LLP (Joshua Feltman, Emil Kleinhaus) & (local) Morris Nichols Arsht & Tunnell LLP (Derek Abbott, Daniel Butz)
  • Ad Hoc Group of Lenders (Apex Credit Partners LLC, Farmstead Capital Management LLC, Goldman Sachs Asset Management LP, Investcorp Credit Management US LLP, Palmer Square Capital Management LLC, Southpaw Asset Management LP, Waddell & Reed Investment Management Company and Ivy Investment Management Company, 
    • Legal: Akin Gump Strauss Hauer & Feld LLP (Arik Preis, Allison Miller, Jason Rubin, Yochun Katie Lee) & (local) Ashby & Geddes PA (Karen Skomorucha Owens, Stacy Newman)
    • Financial Advisor: Moelis & Company LLP
    • DIP Lender: Citizens Bank NA 
      • Legal: Morgan Lewis & Bockius LLP (Robert A.J. Barry, Julia Frost-Davies, Christopher Carter) & (local) Reed Smith LLP (Kurt Gwynne, Emily Devan)
    • Official Committee of Unsecured Creditors
      • Legal: Cooley LLP (Jay Indyke, Cathy Hershcopf, Seth Van Aalten, Max Schlan, Lauren Reichardt) & (local) Klehr Harrison Harvey Branzburg LLP (Michael Yurkewicz, Sally Veghte)
      • Financial Advisor: Province Inc. (Peter Kravitz)

Updated 8/8/17

New Chapter 11 Filing - Takata Corporation

Takata Corporation

• 6/25/17 Recap: The long-awaited chapter 11 (and Japanese Civil Rehabilitation Act) filing of the publicly-traded ($TKJP) airbag manufacturer is finally upon us after the Company endured a massive airbag recall (affecting 124mm automobiles that were deployed with non-desiccated PSAN Inflators, worldwide) and corresponding liability. The Company intends to consummate an agreement in principle with privately-held Key Safety Systems out of Sterling Heights Michigan for a sale of substantially all of the Company's assets for $1.588b. Use of proceeds include satisfying the requirements of a plea agreement with the US Department of Justice, paying administrative costs and expenses of the restructuring (cha-ching Weil, PwC, Lazard & Prime Clerk), and funding unsecured creditor recoveries. The Company has secured a $227mm revolving credit facility from Sumitomo Mitsui Banking Corporation to fund the cases; per its press release, it has also negotiated with its Japanese original equipment manufacturers ("OEMs") for valuable accommodations and liquidity enhancements and continues to negotiate with OEMs elsewhere. Every car manufacturer under the sun is listed as an "undetermined" general unsecured creditor including the likes of Toyota, Ford, Tesla, Fisker, Ferrari, and, of course, the majors. 
• Jurisdiction: D. of Delaware
• Company Professionals:
  • Legal: Weil Gotshal & Manges LLP (Marcia Goldstein, Ronit Berkovich, Matthew Goren, Jessica Diab, Lauren Tauro) & (local) Richards Layton & Finger PA (Mark Collins, Michael Merchant, Amanda Steele, Brett Haywood)
  • Financial Advisor: PriceWaterhouseCoopers LLP (Bill Fasel, Stephen Hammond)
  • Investment Banker: Lazard Freres & Co. LLC
  • Claims Agent: Prime Clerk LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • Daimler Trucks North America LLC 
    • Legal: White & Case LLP (Thomas Lauria, Michael Shepard, Richard Graham)
  • General Motors Holdings LLC
    • Legal: O'Melveny & Meyers LLP (George Davis, Daniel Shamah, Andrew Sorkin, Gary Svirsky)
  • General Motors LLC
    • Legal: Honigman Miller Schwartz & Cohn LLP (Joseph Sgroi, Chauncey C. Mayfield II, Scott Kitai)
  • Key Safety Systems Inc.
    • Legal: Skadden Arps Slate Meagher & Flom LLP (Ron Meisler, Felicia Gerber Perlman, Christopher Dressel, Christine Okike, Esther Adzhiashvili)
  • Honda North America Inc.
    • Legal: Sidley Austin LLP (Michael Andolina, Jessica Knowles Boelter) & (local) Cole Schotz PC (Norman Pernick, J. Kate Stickles)
  • FCA US LLC
    • Legal: Sullivan & Cromwell LLP (Brian Glueckstein, Andrew Dietderich, Alexa Kranzley)
  • Ford Motor Company
    • Legal: McGuireWoods LLP (Mark Freedlander, Frank Guadagnino, John Thompson) & (local) Morris Nichols Arsht & Tunnell LLP (Derek Abbott)
  • Jaguar Land Rover North America LLC
    • Legal: Mayer Brown LLP (Richard Ziegler)
  • Subaru of America Inc.
    • Legal: Kramer Levin Naftalis & Frankel LLP (Adam Rogoff, Anupama Yerramalli, Philip Bentley, David Braun)
  • Toyota Motor Corporation
    • Legal: Frost Brown Todd LLC (Robert Sartin, Patrica Kirkwood Burgess, Ronald Gold) & (local) Landis Rath & Cobb LLP (Adam Landis, Kimberly Brown, Travis Ferguson)
  • BMW Manufacturing Co LLC
    • Legal: Norton Rose Fulbright US LLP (David Rosenzweig, Michael Parker) & (local) Morris Nichols Arsht & Tunnell LLP (Derek Abbott)
  • Nissan Motor Corporation
    • Legal: Jones Day (Pedro Jimenez)
  • Mitsubishi Motors North America Inc.
    • Legal: Paul Weiss Rifkind Wharton & Garrison LLP (Daniel Youngblut, Kevin O'Neill)
  • Tesla Inc.
    • Legal: Irell & Manella LLP (Jeffrey Reisner, Michael Strub, Kerri Lyman) & (local) Reed Smith LLP (Kurt Gwynne, Emily Devan)
  • Volkswagen Group of America, Inc.
    • Legal: Davis Polk & Wardwell LLP (Timothy Graulich, Elliott Moskowitz, Darren Klein)
  • Volvo Group North America LLC
    • Legal: Baker Hostetler LLP (Eric Goodman) & (local) Morris Nichols
  • Official Committee of Unsecured Creditors
    • Legal: Milbank Tweed Hadley & McCloy LLP (Dennis Dunne, Tyson Lomazow, Abhilash Raval, Bradley Scott Friedman) & (local) Whiteford Taylor & Preston LLP (Christopher Samis, L. Katherine Good, Kevin Shaw)
  • Committee of Unsecured Tort Claimant Creditors
    • Legal: Pachulski Stang Ziehl & Jones LLP (Laura Davis Jones, James Stang)

Updated 7/11/17 6 pm (CT)

New Chapter 11 Filing - Keystone Tube Company LLC (A.M. Castle & Co.)

Keystone Tube Company LLC (A.M. Castle & Co.)

• 6/18/17 Recap: Publicly-traded ($CASL) Illinois-based specialty metals distribution company with customers in some hard hit sectors of late, e.g., oil and gas, retail, mining, defense, filed a prepackaged bankruptcy case to de-lever its balance sheet. 
• Jurisdiction: D. of Delaware 
• Capital Structure: $112mm first lien debt (Cantor Fitzgerald Securities), $177mm
• 18 12.75% second lien notes (US Bank NA), $22.3mm '19 5.25% convertible third lien notes (US Bank NA)     
• Company Professionals:
  • Legal: Pachulski Stang Ziehl & Jones LLP (Richard Pachulski, Jeffrey Pomerantz, Maxim Litvak, John Lucas, Peter Keane)
  • Financial Advisor & Investment Banker: Imperial Capital LLC (Joseph Kazanovski)
  • Claims Agent: KCC (*click on company name above for free docket access)
• Other Parties in Interest:
  • Ad Hoc Lender Committee (At Filing: Corre Partners Management LLC, Highbridge Capital Management LLC, SGF Inc., Pandora Select Partners LP, Whitebox Advisors LLC, Wolverine Asset Management Ltd.)
    • Legal (except SGF Inc.): Paul Weiss Rifkind Wharton & Garrison LLP (Andrew Rosenberg, Jacob Adlerstein, Michael Rudnick) & (local) Young Conaway Stargatt & Taylor LLP (Pauline Morgan, Joel Waite, Ian Bambrick)
    • Legal (SGF Inc): Goodwin Proctor LLP (Michael Goldstein, Gregory Fox) & (local) Pepper Hamilton LLP (David Fournier, John Schanne)
    • Financial Advisor: Ducera LLC
  • Prepetition First Lien Agent: Cantor Fitzgerald Securities
    • Legal: Shipman & Goodwin LLP
  • Prepetition Indenture Trustee: US Bank NA
    • Legal: Dorsey & Whitney LLP (Eric Lopez Schnabel, Robert Mallard, Alessandra Glorioso)
  • Administrative Agent: PNC Bank NA
    • Legal: Goldberg Kohn Ltd (Jacob Marshall, Danielle Juhle) & (local) Blank Rome LLP (Josef Mintz)
  • Bank of America NA
    • Legal: Morgan Lewis & Bockius LLP (Jody Barillare, Rachel Jaffe Mauceri)
  • Nantahala Capital Management
    • Legal: King & Spalding LLP (Arthur Steinberg) & (local) The Rosner Law Group LLC (Frederick Rosner)

Updated 7/11/17 6:22 pm

Source: First Day Declaration.

New Chapter 11 Filing - Cornerstone Apparel Inc. (d/b/a Papaya Clothing)

Cornerstone Apparel, Inc. (d/b/a Papaya Clothing)

• 6/15/17 Recap: California-based apparel retailer targeted to the 16-25 year-old demographic and with 80 stores located in malls and shopping centers throughout the US filed for bankruptcy to take advantage of the Bankruptcy Code's "automatic stay" and have time to evaluate and rationalize its retail store footprint. Sadly, the company opted to expand at PRECISELY the wrong time as it opened approximately 50 stores in the last 6 years, incurring significant setup/startup costs in the process. Now it will need to engage in extensive negotiations with landlords to determine what, if anything, it can reorganize around. As part of the filing, the company has already identified 30 locations that it intends to exit from, if it hasn't already.
• Jurisdiction: C.D. of California (Judge Zurzolo)
• Capital Structure: No secured debt.   
• Company Professionals:
  • Legal: Levene Neale Bender Yoo & Brill LLP (Timothy Yoo, Eve Karasik, Juliet Oh)
  • Claims Agent: Rust Consulting/Omni Bankruptcy (*click on link above for free docket)
  • Other Parties in Interest:
    • Official Committee of Unsecured Creditors
      • Legal: Lewis Brisbois Bisgaard & Smith LLP (Scott Lee, Lovee Sarenas)

Updated 8/10/17

New Chapter 11 Filing - The Original Soupman Inc.

The Original Soupman, Inc.

• 6/13/17 Recap: Bankruptcy for you! Company that licensed the name and recipes of the chef who inspired the "Soup Nazi" on Seinfeld has filed for bankruptcy with a $2mm DIP credit facility to fund the case. The CFO had been indicted for tax evasion. We wonder whether the prison he goes to will have soup that lives up to the Soupman standard. Anyway, we digress. The company sells soups to and through grocery chains (6500 of them) and club stores throughout the United States; it also provides soup to the New York City School System and has six franchised restaurants, the largest of which resides on the Upper West Side. So a Nazi serves the school system. Awesome. 
• Jurisdiction: D. of Delaware (Silverstein).
• Capital Structure: $3.66mm secured debt (Hillair Capital Investments LP), $3.3mm unsecured notes.
• Company Professionals:
  • Legal: Polsinelli PC (Christopher Ward, Jarrett Vine, Jeremy Johnson)
  • Financial Advisor/CRO: Wyse Advisors LLC (Michael Wyse) 
  • Claims Agent: Epiq Bankruptcy Solutions LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • DIP Lender: Soupman Lending LLC
    • Legal: Arent Fox LLP (Robert Hirsh, Beth Brownstein) & (local) Bayard PA (Justin Alberto, Erin Fay)

Updated 6/17/17

New Chapter 11 Filing - CGG Holding (US) Inc.

CGG Holding (US) Inc.

• 6/14/17 Recap: Global geophysical and geoscience company servicing customers primarily in oil and gas E&P is the latest victim of the oil and gas downturn of the past two-or-so years. The company's success is tied heavily to the E&P space and those clients were reluctant to invest in data acquisition projects to identify areas for future production or increased current production; therefore, you can imagine what happened to revenues and what that means when you're looking at a debt-stack as aggressive as this one. Indeed revenues and earnings were cut by 67% from 2012 to 2016. Ad hoc groups of secured lenders and high yield bondholders as well as as certain holders of the converts and certain shareholders of CGG SA, the foreign entity that filed in France and for Chapter 15, have entered into a Lock-up agreement delineating a balance sheet restructuring. The upshot is that the high yield bondholders and converts will own the majority of the equity in the reorganized company. 
• Jurisdiction: S.D. of New York (Judge Glenn)
• Capital Structure: $810mm secured debt ($300mm French Revolver of CGG SA - Wilmington Trust (London), $165mm US Revolver - Credit Suisse AG, $342mm US TL - Wilmington Trust NA), $1.6b senior unsecured high yield bonds (The Bank of New York Mellon) and $402.7mm convertible notes (issued by CGG SA).     
• Company Professionals:
  • Legal: Paul Weiss Rifkind Wharton & Garrison LLP (Alan Kornberg, Brian Hermann, Lauren Shumejda, Christopher Hopkins) & (Chapter 15 for CGG SA) Linklaters LLP (Margot Schonholz, Robert Trust, Christopher Hunker)
  • Financial Advisor: AlixPartners LLP (Becky Roof, Susan Brown, Brad Hunter, John Creighton, Francisco Echevarria,John Somerville, David Shim)
  • Investment Banker: Morgan Stanley & Lazard (Kenneth Ziman)
    • Legal (Lazard): Sidley Austin LLP (Thomas Labuda Jr., Andrew Propps)
  • Claims Agent: Prime Clerk LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • Ad Hoc Secured Lender Committee (Och Ziff, Goldman Sachs International, Makuria Investment Management (UK) LLP, T. Rowe Price)
    • Legal: Kirkland & Ellis LLP (Kon Asimacopolous, Stephen Hessler, Anthony Grossi, Hannah Crawford)
  • Ad Hoc Committee of Holders of High Yield Bonds (Alden Global Capital, Attestor Capital LLP, Boussard & Gavaudan Asset Management LP, Contrarian Capital Management LLC, Aurelius Capital Management LP, Third Point LLC)
    • Legal: Wilkie Farr & Gallager LLP (John Longmire, Weston Eguchi)
  • Indenture Trustee for Senior Noteholders: Bank of New York Mellon
    • Legal: Hogan Lovells US LLP (Christopher Donoho, John Beck)

Updated 7/11/17 6:41 CT

New Chapter 11 Filing - GenOn Energy Inc.

GenOn Energy, Inc.

• 6/14/17 Recap: NRG Energy Inc. ("$NRG") owned deregulated wholesale power generation corporation and operator of 32 power plants in 8 states (Mid-Atlantic & California) filed a bankruptcy case with a restructuring support agreement agreed to by NRG and holders of 90% of the funded debt. The plan for the restructuring is to delever the company by $1b with the holders of the unsecured senior notes obtaining equity in the reorganized entity from NRG (and the right to participation in rights offering for $900mm in exit financing). This is another in a line of recent power cases including Panda Temple Power, Homer City Generation LP, Illinois Power Generating Co., La Paloma Generating Company LLC. And it probably won't be the last. The company cited the following causes - in addition to its over-levered capital structure - for the bankruptcy filing: (i) flat demand for power over the past five years, (ii) excess capacity (in part due to insufficient power plant retirements), (iii) lower cost structure for competitors, and (iv) significantly depressed natural gas prices. "This combination has caused energy and capacity prices to fall. So has the Debtors' profitability as a result." In the mid-Atlantic, electricity cleared $100 per megawatt hour in early 2014 and now the price hovers around $30 per megawatt hour. And nat gas isn't predicted to recover to industry price highs at least until 2030. So, looks like the merger that created this combined mid-Atlantic/California entity and levered this sucker up to the sky was a bit ill-timed, hey? 
• Jurisdiction: S.D. of Texas (Judge Jones)
• Capital Structure: $ '18 RCF (NRG Energy Inc. & U.S. Bank NA), $691mm '17 7.875% Senior Notes & $649mm '18 9.50% Senior Notes & $490mm '20 9.875% Senior Notes (Wilmington Trust Company NA), $366mm '21 8.50% Senior Notes & $329mm '31 9.125% Senior Notes (Wilmington Savings Fund Socieity FSB)    
• Company Professionals:
  • Legal: Kirkland & Ellis LLP (James Sprayragen, David Seligman, Steven Serajeddini, W. Benjamin Winger, Christopher Hayes, AnnElyse Scarlett Gibbons) & (local) Zack A. Clement PLLC (Zach Clement)
  • Financial Advisor: McKinsey Recovery & Transformation Services U.S., LLC (Kevin Carmody, Tanner MacDiarmid, Sam Jacobs)
  • Investment Banker: Rothschild & Co. (Todd Snyder)
  • Claims Agent: Epiq Bankruptcy Solutions LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • Ad Hoc Committee of GenOn Note and GAG Notes
    • Legal: Ropes & Gray LLP (Keith Woffard, Stephen Moeller-Sally, Marc Roitman, Meredith Parkinson) & (local) Porter Hedges LLP (John Higgins, Joshua Wolfshohl, Rachel Thompson)
  • Ad Hoc Steering Committee of GAG Notes
    • Legal: Quinn Emanuel Urquhart & Sullivan LLP (David Gerger, Emily Smith, Benjamin Firestone, Daniel Holzman)
  • NRG Energy Inc.
    • Legal: Baker Botts LLP (Emanuel Grillo, Ian Roberts, Christopher Newcomb)
  • Wilmington Trust Company
    • Legal: Covington & Burling LLP (Ronald Hewitt, Dianne Coffino)
  • Issuing Bank: Citibank NA
    • Legal: Latham & Watkins LLP (Richard Levy, David Hammerman)

Updated 7/11/17 6:47 pm CT

New Chapter 11 Filing - FirstRain Inc.

FirstRain, Inc.

• 6/5/17 Recap: California-based enterprise SaaS company that services Fortune 1000 companies with its software and analytics-driven apps to discover/read/discern/summarize useful insights about other companies/markets filed a prepackaged bankruptcy. The plan contemplates $7.5mm of total consideration including a $4mm DIP credit facility and the plan is to pay the DIP Lender in full, general unsecureds in full and provide the prepetition lender a partial recovery. ESW Capital LLC will own the company on the backend of the restructuring.
• Jurisdiction: D. of Delaware (Judge Silverstein)
• Capital Structure: $5.5mm secured debt (Pacific Western Bank as successor to Square 1 Bank)    
• Company Professionals:
  • Legal: The Rosner Law Group LLC (Frederick Rosner, Scott James Leonhardt)
  • Investment Banker: Atlas Technology Group LLC
  • Claims Agent: JND Legal Administration (*click on company name above for free docket access)
• Other Parties in Interest:
  • DIP Lender: ESW Capital LLC
    • Legal: Haynes and Boone LLP (Trevor Hoffman, Arsalan Muhammad) & (local) Morris Nichols Arsht & Tunnell LLP (Derek Abbott, Matthew Talmo)
  • Prepetition Lender: Pacific Western Bank
    • Legal: Levy Small & Lallas (Leo Plotkin) & (local) Chipman Brown Cicero & Cole LLP (William Chipman Jr.) 

Updated 7/18/17

New Chapter 11 Filing - CST Industries Holdings Inc.

CST Industries Holdings Inc.

• 6/9/17 Recap: So this is a soap opera. Kansas City-based manufacturer of (i) industrial containers used to store architectural and agricultural products, water, dry bulk and oil and gas and (ii) domes, filed for bankruptcy due to its unsustainable capital structure and seemingly strained relationship with its senior subordinated noteholders. According to the company's first day declaration, the company sought a prepetition sale that would pay off its BNP Paribas' loan and make a "substantial payout" to its unsecured creditors. But one obstreperous unsecured creditor rejected the sale overtures and demanded that the company pay to hire advisors "that in turn charged CST substantial fees and expenses" to the tune of $8-10mm (inclusive of its own pros fees). Welcome to the party pal. These fees, coupled with downturns in the oil and gas and Middle Eastern water markets, led to a precipitous drop in EBITDA and a liquidity crisis. Now the company hopes to use Chapter 11 to sell itself (pursuant to a $15mm DIP credit facility).
• Jurisdiction: D. of Delaware
• Capital Structure: $57.5mm TL (funded, BNP Paribas), $114.3mm senior subordinated notes (The Northwestern Mutual Life Insurance Company & OCM Mezzanine Fund II LP).     
• Company Professionals:
  • Legal: Hughes Hubbard & Reed LLP (Kathryn Coleman, Christopher Gartman, Jacob Gartman, Anson Frelinghuysen) & Potter Anderson & Corroon LLP (Jeremy Ryan, R. Stephen McNeill, D. Ryan Slaugh)
  • Financial Advisor/Investment Banker: CDG Group LLC (Robert Del Genio)
  • Claims Agent: Epiq Bankruptcy Solutions LLC (*click on company name above for free docket access)
• Other Parties in Interest:
  • TL Agent: BNP Paribas
    • Legal: Chadbourne & Parke LLP (Howard Beltzer, James Copeland, Joseph Giannini) & Norton Rose Fulbright US LLP (Louis Strubeck Jr.) & (local) Young Conaway Stargatt & Taylor LLP (Kara Hammond Coyle)
  • Official Committee of Unsecured Creditors
    • Legal: Lowenstein Sandler LLP (Jeffrey Prol, David Banker, Wojciech Jung, Bruce Nathan) & (local) Shaw Fishman Glantz & Towbin LLC (Thomas Horan, Ira Bodenstein, Christina Sanfelippo)
    • Financial Advisor: Teneo Restructuring and Teneo Capital LLC (Christopher Wu)
  • OCM Mezzanine Fund II, L.P.
    • Legal: Goldberg Kohn Ltd. (William Meyers)
  • Private Equity Sponsor: The Sterling Group

Updated 7/11/17