Delaware Bankruptcy Insider:
Be In The Know

About This Blog


The Delaware Bankruptcy Insider is a premier blog designed to bring its readers a comprehensive analysis of the latest Delaware corporate bankruptcy news and rulings.  Brought to you by Ashby & Geddes, P.A.

Get Updates By Email

Topics

Judges

Recent Posts

Helpful Links


Federal Courts App
 (iTunes)
Federal Courts App (Google Play)
The Bankruptcy Code
Delaware Bankruptcy Court                                                                          Delaware Bankruptcy Court - Local Rules and Orders
Delaware District Court
Third Circuit Court of Appeals
U.S. Supreme Court
The United States Courts
Office of the United States Trustee for the Third Circuit
Delaware Bankruptcy American Inn of Court

For more information


Karen B. Skomorucha Owens, Esq.
(302) 504-3725
kowens@ashby-geddes.com

Aaron H. Stulman, Esq.
(302) 504-3728
astulman@ashby-geddes.com

Ashby & Geddes, P.A.
500 Delaware Avenue
P.O. Box 1150
Wilmington, Delaware 19899-1150
(302) 654-1888               

Showing 4 posts in Make Whole Payments / Prepayment Obligations.

Applying New York Law, Third Circuit Holds That Acceleration Clauses Do Not Negate Make-Whole Redemption Provisions Absent Clear Contractual Language

Delaware Trust Co. v. Energy Future Intermediate Holding Co. (In re Energy Future Holdings Corp.), 842 F.3d 247 (3d Cir. 2016)

Disagreeing with the United States Bankruptcy Court for the Southern District of New York, the Court of Appeals for the Third Circuit held in this Opinion that New York law requires the Energy Future debtors (“EFIH”) to pay redemption premiums (or a “make-whole”) to their first and second lien noteholders under the terms of governing indentures.  In doing so, the Court reversed the district court decision affirming the Delaware Bankruptcy Court’s ruling (discussed here) that the make-whole payments were not due. Read More ›

UPDATE – After Trial And Despite Likelihood Of Success On The Merits, Bankruptcy Court Holds No “Cause” To Lift Automatic Stay, Ending Make-Whole Adversary Proceeding in EFH

Delaware Trust Co. v. Energy Future Intermediate Holding Co. (In re Energy Future Holdings Corp.), Adv. Pro. No. 14-50363 (CSS), --- B.R. ---- (Bankr. D. Del. July 8, 2015)

Previously, the Delaware Bankruptcy Court determined that an evidentiary hearing was necessary on the issue of whether “cause” exists to lift the automatic stay with respect to the make-whole dispute.  For a general background of the facts and law, see our recent blog post here.  Now, after a three-day trial, Judge Sontchi has held that, under the totality of the circumstances, cause does not exist to lift the automatic stay to allow the Trustee* to waive the default, decelerate the Notes, and collect the Applicable Premium (the make-whole payment). Read More ›

Significant Headway Made Relating To EFH Make-Whole Dispute, But Stay Relief Motion And Make-Whole Liability Hang In The Balance

Delaware Trust Co. v. Energy Future Intermediate Holding Co. (In re Energy Future Holdings Corp.), Adv. Pro. No. 14-50363 (CSS), --- B.R. ---- (Bankr. D. Del. Mar. 26, 2015)

On March 26, 2015, Judge Sontchi made a significant, but not entirely dispositive, ruling in the on-going make-whole litigation encompassed within the Energy Future Holdings Corp. (with its affiliates, the “Debtors”) bankruptcy proceedings.  In this Opinion, Judge Sontchi granted summary judgment for the Debtors in part, ruling that (i) the bankruptcy filing caused an automatic redemption and no “Applicable Premium” or make-whole was due; (ii) the EFIH Debtors’ did not file bankruptcy to intentionally default under the parties’ indenture agreement (the “Indenture”); (iii) the Trustee’s right to waive the automatic default and rescind acceleration of the Notes was not barred by the language of the Indenture; (iv) the Trustee’s attempt to waive the default and decelerate the Notes by sending a notice was barred by the automatic stay; and (v) the Trustee has no other claims under the Indenture or New York law arising out of the alleged breach of the Indenture by the EFIH Debtors.  Importantly, the Court denied summary judgment on whether the Trustee could establish “cause” to lift the automatic stay nunc pro tunc to a date on or before the EFIH refinancing, which would allow the Trustee to waive the default, decelerate the Notes, and collect the Applicable Premium. Read More ›

Discovery Regarding a Debtor’s Valuation and Solvency Held Relevant to Makewhole Dispute

CSC Trust Co. of Delaware v. Energy Future Intermediate Holdings Co. (In re Energy Future Holdings Corp.), No. 14-10979 (CSS) (Bankr. D. Del. Aug. 5, 2014)

In the CSC Trust Co. adversary proceeding pending in connection with the Energy Future Holdings Corp. bankruptcy proceedings, an indenture trustee for certain senior secured notes sought a declaration from the Court that certain debtors (the “EFIH Debtors”) are obligated to pay a redemption premium in connection with a proposed refinancing of the notes.  In his Opinion, Judge Sontchi held discoverable information regarding the EFIH Debtor’s valuation and solvency, finding that such information is relevant to the amount that may need to be paid should an enforceable makewhole provision be found.  Despite the foregoing, however, such information was held to be obtainable only from the EFIH Debtors and not from third parties—namely, an ad hoc committee of noteholders—as such parties did not take a position regarding, or intend to offer expert or other evidence on, the EFIH Debtors’ insolvency. Read More ›