jaxstraw
11 years ago
It appears totally upside down when looking at it. No chance of recovery. But certain items are starting to be filed that make it at least worth looking at, and show a possibility of some recovery for equity.
The company has been bleeding for a while in the end of last year and took on a secured credit facility of 35mm from a distressed debt vulture known as Gores Group last Sept.
There were certain covenants in place that if thresholds weren't maintained Gores had ramifications.
The Debtor states that when Gores swept all it's cash in Jan due to breaking the covenant agreement it was forced to file.
One of the items in the 10K though, in the Agreement for the CF with Gores, was a 'Solvency Certificate' where they state in Sept 2012.....
"Pursuant to Section 4.01(g) of that certain Credit Agreement, the undersigned, Kevin Michaels, as Chief Financial Officer of Borrower, hereby certifies, solely in his capacity as an officer of Borrower and not in any individual capacity, that as of the Closing Date, the sum of the Borrower’s current liabilities do not exceed the present fair saleable value of the Borrower’s assets.
http://www.sec.gov/Archives/edgar/data/1023362/000119312513014948/d469213dex101.htm
All the way down to the bottom almost.
This directly contradicts the Statements of Assets and Liabilities when they filed only 3 months later. By a huge margin.
Maybe things have changed, and I know Gores has argued in some of the docs ( Use of Cash Collateral for one) that the assets are not enough, and used that argument to try and sway the court into siding for that particular motion . But have never actually challenged that Solvency Certificate, or even mention it.
So the Debtor is now looking to sell all assets in a 363 sale.
Here is what originally caught my eye about that and made the possibility of equity seeing some recovery if certain things fall into place .....
http://www.kccllc.net/documents/1310134/1310134130304000000000007.pdf
Part of the sale they might be seeking (and/or) is to try and have a 'Plan Sponsored Agreement' where the buyer will purchase all , or part of, the equity interests in the debtor.
http://www.kccllc.net/documents/1310134/1310134130222000000000004.pdf
pg 8
And/or is the catch.
But clearly some of the thought process of the Debtor is for an equity recovery.
Something to notice and depending on the individual, possibly risk an investment.
It is worth noting that the UCC is representing two underlying notes large held by large funds that hold large convertible notes in the agreements. These are the largest Subordinated Debt the debtor has.
The holder at the bottom is P-Wave Holdings ( Gores Group) that is secured.
Kryznowski is Deutsche Bank, and I believe Silver Lake ( big fund..took Dell private) , Empire and Aries are part of the repurchase of the two notes that took place in 2011.
They all took a large stake in the company.
This is from the Financial Statements when they filed. Any of these become less than 5% owners they need to file and none have so far.
Of course they could be selling presently, but would have to exercise the notes first and then file as soon as they get below 5%
http://investorshub.advfn.com/uimage/uploads/2013/3/14/ckrfrrsz_pw1.jpg
Most have been represented in the courtroom telephonically. As well as some other big distressed debt funds.
http://www.kccllc.net/documents/1310134/1310134130204000000000004.pdf
Also interesting to note, from the sign in sheet of the hearing last week on the 21st, ( the sign in sheet was on the minute entry court doc....now it is gone for some reason...was 3 pages when entered...now 1) that an 'Ad Hoc Note Holders Committee' is being represented. Why they are not part of the UCC is a development I would like to uncover. Their interests should be aligned, as well as paid for by the estate...yet some have sought their own representation.
As far as these funds holding the convertible notes, they are presently convertible, yet none seem to be divesting. .Although I do not ever get my hopes up when dealing with these funds anymore since their self interest can very easily submarine equity...even when it appears they are aligned.
The share structure is small. About 32mm OS, and about 15mm is held by those funds and insiders. There were a few 13g filings after BK showing that the convertible is being counted towards the present OS ( I believe I'm right about that.)
http://investorshub.advfn.com/uimage/uploads/2013/3/14/ckrfrrsz_pw1.jpg
http://investorshub.advfn.com/uimage/uploads/2013/3/14/sgiivrsz_pw2.jpg
CowBoE
11 years ago
March 14, 2013 (1:00 p.m. ET), Meeting of Creditors Notice of Commencement and Meeting of Creditors
http://www.kccllc.net/documents/1310134/1310134130207000000000001.pdf
NOTICE OF COMMENCEMENT OF CHAPTER 11 BANKRUPTCY CASE,
MEETING OF CREDITORS AND FIXING OF CERTAIN DATES
On January 28, 2013, the above-captioned debtor and debtor in possession in the abovecaptioned
case (the “Debtor”) filed a voluntary petition for relief under chapter 11 of title 11 of the United
States Code, 11 U.S.C. §§ 101 through 1330 (the “Bankruptcy Code”). The Debtor’s address, case
number and federal tax identification number are as follows:
Powerwave Technologies, Inc. 1801 E. St. Andrews Place
Santa Ana, CA 92705 13-10134 (MFW) 11-2723423
DATE, TIME AND LOCATION OF MEETING OF CREDITORS. In accordance with section 341 of
the Bankruptcy Code, a meeting of the Debtor’s creditors will be conducted on Thursday, March
14, 2013, at 1:00 p.m. prevailing Eastern Time, J. Caleb Boggs Federal Courthouse, 844 King
Street, 2nd Floor, Room 2112, Wilmington, DE 19801.
DEADLINE TO FILE A PROOF OF CLAIM. Notice of deadline will be sent at a later time.
NAME, ADDRESS AND TELEPHONE NUMBER OF TRUSTEE. None appointed to date.
POTTER ANDERSON &
CORROON LLP
Laurie Selber Silverstein (DE Bar No.
2396)
Jeremy W. Ryan (DE Bar No. 4057)
R. Stephen McNeill (DE Bar No.
5210)
1313 North Market Street, Sixth Floor
P.O. Box 951
Wilmington, DE 19801
Telephone: (302) 984-6000
Facsimile: (302) 658-1192
PROSKAUER ROSE
LLP
Mark K. Thomas
Peter J. Young
Three First National Plaza
70 West Madison, Suite
3800
Chicago, IL 60602-4342
Telephone: (312) 962-
3550
Facsimile: (312) 962-
3551
PROSKAUER ROSE LLP
Jared Zajac
Eleven Times Square
(Eighth Avenue & 41st
Street)
New York, NY 10036-
8299
Telephone: (212) 969-
3000
Facsimile: (212) 969-
2900
1 The last four digits of the Debtor’s federal tax identification number are 3423.
Case 13-10134-MFW Doc 70 Filed 02/07/13 Page 1 of 2
PAC 1093261v.2
COMMENCEMENT OF CASES. Petition for reorganization under chapter 11 of the Bankruptcy Code
have been filed in this Court by the Debtor listed above, and an order for relief has been entered. You
will not receive notice of all documents filed in this case. All documents filed with the Court, including
lists of the Debtor property and debts, are available for inspection at the Office of the Clerk of the
Bankruptcy Court. In addition, such documents may be available at www.deb.uscourts.gov (the “Court
Website”).
PURPOSE OF CHAPTER 11 FILING. Chapter 11 of the U.S. Bankruptcy Code enables a debtor to
reorganize pursuant to a plan. A plan is not effective unless approved by the court at a confirmation
hearing. Creditors will be given notice concerning any plan, or in the event the case is dismissed or
converted to another chapter of the Bankruptcy Code. The Debtor will remain in possession of its
property and will continue to operate any business unless a trustee is appointed.
CREDITORS MAY NOT TAKE CERTAIN ACTIONS. A creditor is anyone to whom a debtor owes
money or property. Under the Bankruptcy Code, a debtor is granted certain protection against creditors.
Common examples of prohibited actions by creditors are contacting a debtor to demand repayment,
taking action against a debtor to collect money owed to creditors or to take property of a debtor, and
starting or continuing foreclosure actions or repossessions. If unauthorized actions are taken by a creditor
against a debtor, the Court may penalize that creditor. A creditor who is considering taking action against
a debtor or the property of a debtor should review § 362 of the Bankruptcy Code and may wish to seek
legal advice. The staff of the Clerk of the Bankruptcy Court are not permitted to give legal advice.
MEETING OF CREDITORS. The Debtor’s representative, as specified in Rule 9001(5) of the Federal
Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), is required to appear at the meeting of creditors
on the date and at the place set forth above for the purpose of being examined under oath. Attendance by
creditors at the meeting is welcomed, but not required. At the meeting, the creditors may examine the
Debtor and transact such other business as may properly come before the meeting. The meeting may be
continued or adjourned from time to time by notice at the meeting, without further written notice to the
creditors.
CLAIMS. Schedules of creditors will be filed pursuant to Bankruptcy Rule 1007. Any creditor holding a
scheduled claim which is not listed as disputed, contingent, or unliquidated as to amount may, but is not
required to, file a proof of claim in these cases. Creditors whose claims are not scheduled or whose
claims are listed as disputed, contingent, or unliquidated as to amount and who desire to participate in the
cases or share in any distribution must file its proofs of claim. A creditor who desires to rely on the
schedule of creditors has the responsibility for determining that the claim is listed accurately. Separate
notice of the deadlines to file proofs of claim and proof of claim forms will be provided to the
Debtor’s known creditors. Proof of claim forms also are available in the clerk’s office of any
bankruptcy court. Proof of Claim forms are also available from the Court’s web site listed above.
Additionally, Kurtzman Carson Consultants LLC (“KCC”) is the claims agent in this case and can
provide a proof of claim form if you cannot obtain one from your local bankruptcy court. Proof of claim
forms are also available from KCC’s web site at www.kccllc.net/powerwave.
DISCHARGE OF DEBTS. Confirmation of chapter 11 plan may result in a discharge of debts, which
may include all or part of your debt. See Bankruptcy Code § 1141(d). A discharge means that you may
never try to collect the debt from the debtor, except as provided in the plan.
For the Court: /s/ David D. Bird Dated: February 7, 2013
smf222
11 years ago
Volume Surge - Big Move Coming Next Week
Nearly one million shares traded. Highest volume in two weeks. PWAV must declare in court their intention to reorganize or sell assets Tuesday....
IMO, Gores Group has taken the lead in salvaging the company's assets out of Chapter 11 - preserving the interests of Clear Lake, Empire, Deutsche Bank, and their own - and will resurrect the assets (likely later sell them at profit) as a profitable company.....
But, unfortunately, at the expense of common shareholders....
smf222
11 years ago
RE: Sign in sheet for the 1/31 Hearing
This is a very interesting audience. Thank you.
First, I must clarify my earlier statement regarding Silver Lake's current interest in PWAV to note they received warrant interests as "payment in kind."
But most interesting, in reviewing PWAV's credit agreement with Gore Group, it contains these provisions which would become effective should PWAV fail to maintain any of numerous covenents detailed in the credit agreement:
" Pursuant to the terms of the Security Agreement, the Company (i) granted to the Agent, on behalf of the Lenders, a first priority perfected security interest in substantially all of its assets, including all of its intellectual property rights; and (ii) pledged and delivered possession of all of the equity securities held by the Company of certain of its domestic subsidiaries and 66% of the equity securities of certain of its foreign subsidiaries held by the Company.
" The Security Agreement further provides that, amongst other things, upon the occurrence and during the continuance of an Event of Default (as defined therein), the Agent will become entitled to (i) take possession of and to sell the assets of the Company in order to recover the amounts due to the Lenders under the Credit Agreement and any other amounts, fees or payments that may be due and payable to the Lenders under the Credit Agreement or any related documents; and (ii) transfer the pledged securities into its name, to vote those securities and, subject to applicable securities laws, to sell those securities in order to recover amounts owed to it by the Company under the Credit Agreement.
" Furthermore, the Company and the Agent entered into a customary Copyright Security Agreement, Patent Security Agreement and Trademark Security Agreement, in substantially the forms attached to the Security Agreement. "
Current report filing (8-K)
Date : 09/12/2012 @ 9:15AM
Source : Edgar (US Regulatory)
Sounds as if Gore Group got "first priority" legal rights to the company's assets for $50 million, doesn't it?
smf222
11 years ago
RE: CASE INFORMATION - COURT DOCS
Thank you for the link.
I agree with you that even large entities take losses and that shareholders hold on to the hope that because big players are involved there is hope.
But the timing of Gore Group and Silver Lake involvement is, indeed, curious to me.
We have details and timing of Gore Group funding, but not so with Silver Lake. I'm surmising that since they noted becoming beneficial owners as of 12/31/12, they had recently provided some financial consideration to PWAV for which they received payment "in kind" in the form of shares.
In this apparent end-stage of PWAV's operation, they appear to be attempting to delay the inevitable. However, based on Gore Group and Silver Lake individual track records, I see them well aware of what they were getting into when they engaged with PWAV; and, further, that they saw a profitable outcome for their respective interests. PWAV common shareholders will not likely see a profitable outcome; but I believe we will see profitable outcomes for both Gore Group and Silver Lake, indeed.
BTW, are you aware of any connection between Gore Group and Silver Lake? That would be an interesting item....
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