Curing Ambiguities and Defects Without Noteholder Vote: Not So Fast
Funds Talk: October 2016
Dewey & LeBoeuf LLP — Kramer Levin represented JPMorgan Chase Bank, N.A., as administrative agent for more than $75 million of secured bank debt and as collateral agent for more than $225 million in secured bank and bond debt, in the chapter 11 proceedings of Dewey & LeBoeuf — the largest law firm bankruptcy case ever filed and one of the most newsworthy bankruptcies of 2012. Within two weeks of the bankruptcy filing, Kramer Levin successfully negotiated the terms of a consensual cash collateral order to enable the debtor to finance its wind-down, including the collection of accounts receivable and the pursuit and/or settlement of potential claims against former partners and the law firms to which such partners migrated. Kramer Levin also advised the agent in connection with a partner contribution plan that was approved in October 2012.
Orchard Brands — Kramer Levin represented American Capital, Ltd. in connection with the bankruptcy cases of Orchard Brands Corporation and its affiliates, one of the nation’s largest catalog retailers. Kramer Levin counseled American Capital as lender in connection with a $140 million debtor-in-possession financing, and negotiated the terms of a chapter 11 plan of reorganization and $400 million in exit financing facilities and other agreements. Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del. called the restructuring an “excellent result” that will preserve about 4,000 jobs.
Tribune Company — Kramer Levin represented bank lenders holding more than $3 billion in claims in the chapter 11 reorganization of Tribune Company. Tribune, which has over $10 billion in bank and bond debt, owns The Chicago Tribune, The Los Angeles Times, numerous other media properties including TV and radio stations, and — prior to the sale of the ball club in bankruptcy — the Chicago Cubs.
Charter Communications, Inc. — Kramer Levin represented first lien bank lenders holding approximately $2 billion in claims in the chapter 11 reorganization of Charter Communications, Inc., a case that involved the restructuring of over $22 billion in bank and bond debt. On behalf of this group, Kramer Levin opposed the reinstatement of the obligations under the first lien credit facilities under the plan of reorganization, arguing that certain defaults existed (including a change of control) which could not be cured. Charter, the fourth-largest cable operator in the country with operations in 27 states and approximately 5.5 million residential and commercial customers, confirmed its plan of reorganization in November 2009. An appeal of these issues (among others) was dismissed as a part of a consensual amendment to the credit facilities in April 2010.
CIT Group — Kramer Levin represented a member of the Steering Committee of bondholders who negotiated the restructuring of CIT.
AbitibiBowater Inc. — Kramer Levin represented a significant creditor and lender to AbitibiBowater Inc. under the $206 million debtor-in-possession financing. AbitibiBowater Inc. is the world’s largest producer of newsprint by capacity and one of the largest publicly traded pulp and paper manufacturers in the world.
Performance Transportation Services — Kramer Levin represented the agent for the first lien lenders and the DIP lenders in the bankruptcy case of Performance Transportation Services, the second largest hauler of automotive vehicles in North America. In connection with this representation the firm engaged in a review of PTS’ workers’ compensation insurance, contracts with original equipment manufacturers and labor relations in the automotive industry.
Owens Corning — In the bankruptcy of Owens Corning, a mass tort bankruptcy of national prominence, Kramer Levin represented the agent for a consortium of 47 bank lenders with $1.6 billion of debt, in opposing efforts by bondholders and asbestos creditors of Owens Corning to use substantive consolidation or fraudulent conveyance theories to set aside guarantees obtained by the banks against several Owens Corning subsidiaries. The firm spearheaded extensive discovery, including depositions of more than 30 witnesses, and a trial of the substantive consolidation issues, and played a key role in an appeal that resulted in an historic decision by the Third Circuit Court of Appeals ruling out substantive consolidation in the Owens Corning case.
Citigroup — Kramer Levin represented Citigroup as agent for lenders in connection with a real estate transaction. Kramer Levin’s litigation, bankruptcy and real estate lawyers collaborated to enable Citigroup to foreclose on a $126 million loan facility against an aggressive and litigious borrower.
BNP Paribas — Kramer Levin represented BNP Paribas as agent to the lenders under a first lien credit facility in connection with an out-of-court restructuring of a privately held cabinet manufacturer.
Pacific Gas & Electric Company — In the Pacific Gas & Electric Company bankruptcy case, Kramer Levin represented the bank group agent on letters of credit supporting tax-free bonds. The firm also represented the bank group agent in connection with a construction financing under a synthetic lease and the restructuring of PG&E Company’s non-regulated businesses to make certain assets bankruptcy-remote.
Aspen Marketing — Kramer Levin represented the agent for the bank group in a successful out of court restructuring of Aspen Marketing, a direct marketing company that provided a range of marketing communications, specialist printing and communications services. In the restructuring, the bank group acquired 100% of the voting equity of the company. The firm led the bank group through a sale and auction process that resulted in a substantial recovery for the bank syndicate.
Glenoit Corporation — Kramer Levin represented the bank group of Glenoit Corporation, an international producer and distributor of home furnishings and textiles. On behalf of the bank group, the firm was actively involved in the sale of various operating businesses and confirmation of a plan of reorganization that permitted the company to reorganize around a going concern.
Precision Custom Coatings — Kramer Levin represented the bank group in connection with the bankruptcy of Precision Custom Coatings, advising the banks with respect to the extension of DIP financing and the negotiation of the terms of a potential sale of the debtor, a potential exit facility and the terms of the plan of reorganization.
American Capital — Kramer Levin represented American Capital, Ltd. in connection with the bankruptcy cases of Orchard Brands Corporation and its affiliates, one of the nation’s largest catalog retailers. Kramer Levin counseled American Capital as lender in connection with a $140 million debtor-in-possession financing, and negotiated the terms of a chapter 11 plan of reorganization and $400 million in exit financing facilities and other agreements. Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del. called the restructuring an “excellent result” that will preserve about 4,000 jobs.
Credit Suisse — Kramer Levin represented Credit Suisse as agent for first lien lenders in connection with the pre-negotiated bankruptcy of the third largest manufacturer of greeting cards in the U.S. The matter involved a complex sale of the business to a competitor and large creditor of the borrower. Kramer Levin also represented Credit Suisse as agent for first lien lenders in connection with an out of court restructuring for a leading magazine and media company. The matter involved the conversion of first lien debt into new debt and equity of the reorganized company.