The U.S. Bankruptcy Court issued an order denying Noranda Aluminum Holding’s ad hoc consortium of minority pre-petition term lenders’ motion for entry of an order providing adequate protection of their interests in property pursuant to the pre-petition term loan agreement, the final D.I.P. order and Bankruptcy Code Sections 361 and 364.
The Court order states, “After consideration of the Motion, the objections thereto, the Minority Lenders’ omnibus reply, the evidence submitted by the parties, the arguments of counsel, and all other matters presented to the Court, for the reasons stated on the record by the Court and the conclusion of the hearing, and good cause appearing thereof, this Court finds that: The Motion sought additional adequate protection in two forms: (i) affirmance of the Minority Lenders’ entitlement under Paragraph 8(f) of the Final DIP Order to ‘the same reporting, notification and other information rights’ as the Term DIP Lenders, and (ii) payment of the fees, expenses and disbursements of the Minority Lenders’ primary and local counsel.”
The order continues, “Specifically, the Court finds that: a. The Minority Lenders’ allegation that ‘a potential conflict exists due to a potential value-eroding credit bid of the [Term DIP Loans, or a coercive credit bid by [the Pre-Petition Term Agent] of the Pre-Petition Term Debt that enriches only the Majority Lenders’ is speculative, as no such evidence is before the Court.”
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