4/17/17 Recap: Large US manufacturer of photovoltaic solar cells used in residential, commercial and government solar applications filed for bankruptcy because of (cue ominous music) CHINA. Shocker! China's well-documented cheap solar capacity and flooding of the US market has pressured the US market for years (and resulted in the imposition of 30% tariffs on the Chinese - tariffs that were easily circumvented through creative delivery through other parts of Asia). Luckily, management didn't get ahead of their skis and expand by (i) tripling the company's manufacturing capacity and (ii) spending nearly $100mm on larger facilities (while incurring new debt). Oh wait, strike that: that's precisely what management did. Oops. (More to come.)
Jurisdiction: D. of Delaware
Capital Structure: $50.9mm (SQN Asset Servicing LLC), $15mm LOC (Wanxiang America Corporation - now first in priority as successor to Wells Fargo's rights)
Company Professionals:
Legal: KilpatrickTownsend & Stockton LLP (Todd Meyers, Colin Bernardino, Gianfranco Finizio) & (local) Potter Anderson & Corroon LLP (Jeremy Ryan, R. Stephen McNeill, D. Ryan Slaugh)
Financial Advisor/CRO: Aurora Management Partners Inc. (David Baker, Steve Smerjac, Matt McEnerney)
Claims Agent: The Garden City Group Inc. (*click on the company name above for free docket)
Other Parties in Interest:
SunEdison Products Singapore Pte. Ltd.
Legal: Togut Segal & Segal LLP (Frank Oswald, Brian Moore)
Wells Fargo NA
Legal: Morgan Lewis & Bockius LLP (Richard Esterkin, Kelly Costello)
Alternative DIP Lender: Lion Point Capital LP
Legal: Cleary Gottlieb Steen & Hamilton LLP (Sean O'Neal, Jane VanLare, Thomas Kessler) & Ashby & Geddes PA (Ricardo Palacio, Karen Skomorucha Owens)
3/8/17 Recap: The Pittsburgh-based manufacturer of saltwater batteries used for energy storage has filed for bankruptcy after burning through tens of millions of dollars. The goal is to explore an asset sale. Prepetition efforts by Citi Global Markets Inc. to attract a buyer or raise capital for the company fell short (something tells us their engagement letter and tail payment are going to be in the rejection bin). The privately-owned company received $180mm of venture capital money from high profile investors like Bill Gates (labeled the "kiss of death in energy storage" here and conveniently omitted from mention in the filing declaration), top venture capital fund Kleiner Perkins Caufield & Byers, and corporate venture capital units of Total, Exelon Corporation and Royal Dutch Shell. This case is generally smaller than what we cover but it is representative of the fact that, despite widespread adoption of renewable energy sources, storage solutions are very expensive to deploy.
Capital Structure: $20mm TL (~$5.2mm funded)(Trinity Capital Fund II LP)
Jurisdiction: D. of Delaware
Company Professionals:
Legal: Pachulski Stang Ziehl & Jones LLP (Laura Davis Jones, David Bertenthal, Joseph Mulvihill, Maxim Litvak) & (special counsel) Morgan Lewis & Bockius LLP (Julia Frost-Davies)
Financial Advisor: Protiviti Inc. (Suzanne Roski)
Claims Agent: KCC (*click on company name for docket)
2/27/17 Recap: High-flying (ugh) drone startup that put together kick-a$$ production videos and crowdfunded tens of millions of dollars ($34.8mm to be exact) from tens of thousands of generous suckers (61.450 to be exact) filed for bankruptcy to implement an IP sale, a liquidating plan and avoid investigation and litigation. They'll probably throw in extensive releases for Spark Capital for good measure because, well, why the hell not? And next thing you know, the "revolutionary" and "disruptive" founders will end up fundraising for their next hair-brained scheme and convince yield-starved investors to back them again a la Fab.com's Jason Goldberg. No bubble to see here. Just the dumpster fire that is $13.8mm of Spark Capital's equity capital.
Jurisdiction: D. of Delaware
Capital Structure: ~$4mm TL (Spark Capital, VC, successor to SVB Financial Group)
Company Professionals:
Legal: Orrick Herrington & Sutcliffe LLP (Laura Metzger, Jennifer Asher, Douglas Mintz) & (local) Morris Nichols Arsht & Tunnell LLP (Robert Dehney, Andrew Remming, Marcy McLaughlin)
2/6/17 Recap: These bada$$ strapping towing lads fought the law and the law won. Meaning: a $5mm judgment was rendered against the Illinois-based company for purportedly charging excessive fees and now the company has less money, mo' problems. The company filed chapter 11 to obtain cover under the automatic stay (and avoid enforcement of the judgment) and sell the company. No stalking horse bidder, however, is in tow (see what we did there?). First lien lender Wells Fargo is providing a $32.25mm DIP to fund the case.
Jurisdiction: D. of Delaware
Capital Structure: $32.3mm first lien credit facility ($13.8mm out - Wells Fargo) & $17mm second lien credit facility ($19.4 claim - Medley Capital)
Company Professionals:
Legal: Winston & Strawn LLP (Daniel McGuire, Grace D'Arcy, Carrie Hardman) & (local) Young Conaway Stargatt & Taylor LLP (M. Blake Cleary, Ryan Bartley, Andrew Magaziner)
Financial Advisor: Getzler Henrich & Associates LLC
Investment Banker: SSG Advisors LLC
Claims Agent: Rust Consulting/Omni Bankruptcy LLC (*click on company name for docket)
12/21/16 Recap: A "classic example of a good company with a bad balance sheet," the Virginia-based largest US-owned provider of temporary and permanent modular buildings files a prearranged bankruptcy and corresponding CCAA to restructure its balance sheet. The company struggled after the 2007 recession, with utilization levels dropping meaningfully. More recently, oil-related business in Texas and Western Canada has contracted significantly. Finally, a proposed merger with Williams Scotsman International Inc. which would have infused the company with new equity and help manage the balance sheet issues collapsed after new money equity investors grew skittish after Brexit. Subsequent equity investment proposals were rejected and a restructuring transaction pursued and ultimately agreed upon.
Jurisdiction: D. of Delaware
Capital Structure: $984.2mm total funded debt + $37.7mm of accrued interest ($609.2 ABL (Bank of America), $375mm 10.25% '19 senior secured second lien notes (Wells Fargo))
Company Professionals:
Legal: Cleary Gottlieb Steen & Hamilton LLP (James Bromley, Jane VanLare, Kara Hailey, Samuel Hershey) & (local) Young Conaway (Pauline Morgan, Joel Waite, Ian Bambrick)
Financial Advisor: Zolfo Cooper (David Orlofsky)
Investment Banker: Lazard Freres & Co. LLC and Lazard Middle Market LLC (Jason A. Cohen)
Claims Agent: KCC (*click on company name for docket)
Other Parties in Interest:
Wells Fargo Capital Finance LLC
Legal: Otterbourg PC (Andrew Kramer)
ABL Lenders
Legal: Parker Hudson Rainer & Dobbs (C. Edward Dobbs, James Rankin, Eric Anderson) & (local) Ashby & Geddes LLP (William Bowden)
Ad Hoc Group of Consenting Noteholders (AllianceBernstein, Blackrock, Brookfield, Carl Marks, Corre Partners, KLS Diversified, Manulife, and Symphony)
Legal: Dechert LLP (Michael Sage, Brian Greer, Stephen Wolpert, Michael Maloney) & (local) Richards Layton & Finger PA (Daniel DeFranceschi, Robert Stern)
