Bankruptcy News

Peabody Energy Plan Summarized

BankruptcyData's detailed analysis and summary of Peabody Energy's Second Amended Plan of Reorganization [Revised], dated March 15, 2017, is now available. The U.S. Bankruptcy Court confirmed the Plan on March 17, 2017; however, an effective date has not yet been issued. BankruptcyData notes, "The Plan and the Global Settlement Agreement contemplates that the Debtors’ debt burden will be reduced by over $6.6 billion, a necessary step for the Debtors’ financial health given the volatile industry in which the Debtors operates. The Plan will provide creditors with recoveries, funded in large part by a $1.5 billion first lien exit facility, subject to being upsized as described herein, a $750 million rights offering available to holders of Allowed Second Lien Notes Claims in Class 2 and Allowed General Unsecured Claims in Class 5B as of the Rights Offering Record Date and a $750 million direct investment by the Noteholder Co-Proponents and certain additional creditors….Ultimately, to resolve the Valuation Dispute, in connection with the Global Settlement embodied in the Plan, the Plan Proponents agreed that the Plan enterprise value is $4.275 billion and that Plan equity value is $3.105 billion." BankruptcyData's Plan Summary continues, "The Liquidation Analysis for Reorganized Peabody Energy Corporation estimates the Total Distribution Value to be between $2,854.8 million and $3,254.7 million with the Midpoint to be $3,053.0 million. The recovery rate to the First Lien Lender Claims is estimated to be between 85% and 91%. The recovery rate to the Second Lien Notes Claims and General Unsecured Claims is estimated to be zero." BankruptcyData subscribers receive access to the full summary, which provides further details on corporate background, events leading to Peabody Energy's April 30, 2016 Chapter 11 filing, recovery specifications and a comprehensive break-down of all claimant classes.

NephroGenex Disclosure Statement Approved

The U.S. Bankruptcy Court issued an order approving NephroGenex's Disclosure Statement and scheduled a May 10, 2017 hearing to consider the Plan of Reorganization. As previously reported, "The Debtor projected that, under the Liquidating Plan, the Debtor's unsecured creditors would receive distributions equal to 26.8% to 37.1% of the allowed amounts of their claims….Medpace has agreed to waive its Cash Distribution under the Plan and exchange its General Unsecured Claim against the Debtor in the amount of $4,312,698.51 (the 'Medpace Claim') for one hundred percent (100%) of the New Common Stock in the Reorganized Debtor. The Medpace Claim is by far the largest Claim against the Debtor's estate and comprises at least 65% of the pool of General Unsecured Claims. As a result of the contemplated restructuring under the Plan, Holders of Allowed General Unsecured Claims are projected to receive a 46.4% to 50.4% recovery on their Claims - which is a material improvement over the 26.8% to 37.1% projected recovery under the Debtor's Liquidating Plan." Under the Court order, the Debtors shall file any Plan Supplements before April 21, 2017 and Plan objections must be filed by April 27, 2017.

hhgregg Objection Filed

hhgregg's official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to the Debtors' post-petition financing motion. The objection asserts, "The course of these chapter 11 cases was set day one by the Debtors' secured lenders for their sole and exclusive benefit and without regard to the consequences for the Debtors' administrative and general unsecured creditors. Rather than serve as a lifeline for the Debtors, the DIP Facility appears to be nothing more than a nail in the coffin. If the DIP Facility is approved as proposed, the DIP Secured Parties would receive exorbitant fees and obtain all of the benefits of chapter 11, without sufficiently providing for the costs and expenses of administering these cases… At the same time, the DIP Secured Parties seek to grab the few remaining unencumbered assets of these estates, including avoidance actions, leasehold proceeds and commercial tort claims. The DIP Secured Parties also stand to be paid more than $5 million in fees and interest in exchange for limited funding which appears to give the Debtors no option but to liquidate. The Committee will not support approval of a DIP facility that takes money otherwise be available for creditors whose real estate, goods and services are buoying the value of the lenders' collateral, and uses it to line the pockets of the Debtors' secured lenders."

Nortel Networks M.O.R. Filed

Nortel Networks filed with the U.S. Bankruptcy Court a monthly operating report for February 2017. For the month, the Company reported total disbursements of $6.4 million and cash receipts of $0.2 million and paid $4.8 million in professional fees. Cash at the beginning of February 2017 was $559.7 million and $553.5 million at month's end, with a $6.2 million net decrease in cash flow.

CHC Group Plan Effective

CHC Group's Fourth Amended Chapter 11 Plan of Reorganization became effective, and the Company emerged from Chapter 11 protection. The U.S. Bankruptcy Court confirmed the Plan on March 3, 2017. BankruptcyData's Plan Summary notes, "Pursuant to the Plan Support Agreement and Plan, holders of Allowed Senior Secured Notes Claims and Allowed Unsecured Notes Claims that are Eligible Offerees will have the opportunity to participate in the $300 million Rights Offering, with Subscription Rights to participate in $280 million of the Rights Offering (which equates to 74.41% of the New Membership Interests issuable upon conversion of such New Second Lien Convertible Notes on a fully diluted basis (but subject to dilution for the Management Incentive Plan) as of the Effective Date (i.e., $404,444,444 face amount of the New Second Lien Convertible Notes as of the Effective Date)) allocated to the holders of Allowed Senior Secured Notes Claims and $20 million of the Rights Offering (which equates to 5.32% of the New Membership Interests issuable upon conversion of such New Second Lien Convertible Notes on a fully diluted basis." This helicopter services provider filed for Chapter 11 protection on May 4, 2016, listing $2.3 billion in pre-petition assets.

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