SunEdison
SUNE Has Partially Tapped LC Facility
Fri 04/15/2016 13:12 PM
Relevant Document:
8-K
SunEdison has drawn down about $145 million in letters of credit, Reorg Research has learned. Lenders under the LC credit facility have a first-priority lien on substantially all of the assets of the company and the guarantor subsidiaries, ahead of the second liens. Further, second lien claims are explicitly subordinated to claims stemming from the LC credit facility under an intercreditor agreement between the LC and second lien lenders.
The LC facility “had $716 million of outstanding third party letters of credit backed by the Credit Facility, which reduced the available capacity” as of Sept. 30, according to the third-quarter financials, which are the latest the company has disclosed. Sources tell Reorg Research that as of April 10, the LC lenders have paid a portion to counterparties - including the $145 million noted above, which, along with any other amounts paid to counterparties, would potentially be senior secured claims in a bankruptcy.
SunEdison spokesman Ben Harborne declined to comment.
SunEdison has just disclosed that it was discussing with certain second lien lenders in March a $310 million DIP, though terms of the potential deal have not yet been finalized and agreed to by the company and the potential DIP lenders, according to these sources. The LC facility has been one of the sticking points in negotiations with creditors, given concerns about the size of potentially priming LC claims.
The second lien facility is still quoted in the high 30s after the cleansing materials were released, according to trader runs, but there has been no trading.
The sources and uses mentioned in the presentation today - which note a cash balance of just $33 million as of March 10 - make note of an equal amount of LC collateralization and relief that would take place through June 23, moving the cash balance down and up $246 million, respectively.
Goldman Sachs, Deutsche Bank, Wells Fargo and Macquarie Capital were joint bookrunners on the original credit facility in 2014 that provided for the letter of credit.
The first lien credit agreement which provides for the LCs was amended in January as part of the second lien financing.
8-K
SunEdison has drawn down about $145 million in letters of credit, Reorg Research has learned. Lenders under the LC credit facility have a first-priority lien on substantially all of the assets of the company and the guarantor subsidiaries, ahead of the second liens. Further, second lien claims are explicitly subordinated to claims stemming from the LC credit facility under an intercreditor agreement between the LC and second lien lenders.
The LC facility “had $716 million of outstanding third party letters of credit backed by the Credit Facility, which reduced the available capacity” as of Sept. 30, according to the third-quarter financials, which are the latest the company has disclosed. Sources tell Reorg Research that as of April 10, the LC lenders have paid a portion to counterparties - including the $145 million noted above, which, along with any other amounts paid to counterparties, would potentially be senior secured claims in a bankruptcy.
SunEdison spokesman Ben Harborne declined to comment.
SunEdison has just disclosed that it was discussing with certain second lien lenders in March a $310 million DIP, though terms of the potential deal have not yet been finalized and agreed to by the company and the potential DIP lenders, according to these sources. The LC facility has been one of the sticking points in negotiations with creditors, given concerns about the size of potentially priming LC claims.
The second lien facility is still quoted in the high 30s after the cleansing materials were released, according to trader runs, but there has been no trading.
The sources and uses mentioned in the presentation today - which note a cash balance of just $33 million as of March 10 - make note of an equal amount of LC collateralization and relief that would take place through June 23, moving the cash balance down and up $246 million, respectively.
Goldman Sachs, Deutsche Bank, Wells Fargo and Macquarie Capital were joint bookrunners on the original credit facility in 2014 that provided for the letter of credit.
The first lien credit agreement which provides for the LCs was amended in January as part of the second lien financing.
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