The U.S. Bankruptcy Court for Delaware on Dec. 9 approved the Chapter 11 reorganization plan of renewable power plant owner Noble Environmental Power LLC.
The plan turns the reorganized company over to its primary lender. The plan provides that the reorganized company will be managed by its sole member, Paragon Noble LLC.
Said a Dec. 6 brief tht Noble filed with the court in support of this plan: “The Debtor and the Lender believe that the proposed restructuring under the Plan is favorable for the Debtor’s creditors because it achieves a substantial deleveraging of the Debtor’s balance sheet (approximately $21.5 million) through consensus with the Debtor’s most significant creditor and eliminates potential deterioration of value—and disruptions to operations—that could otherwise result from a protracted and contentious bankruptcy case. Importantly, the Debtor would not be able to implement the conversion of debt to equity proposed under the Plan without the support of its creditor constituents. In sum, the Plan avoids a default that could decrease value for all creditors and delay (and possibly derail) the restructuring process, which, in turn, would devastate future revenues. The Debtor believes that the Plan provides a fair and reasonable path to preservation of operations and value.
“The Debtor has worked diligently to formulate a plan of reorganization in the Chapter 11 Case that will rehabilitate the Debtor such that Reorganized NEP will be a viable going concern following emergence, and distribute the value of the Debtor’s estate in a fair and equitable manner consistent with applicable law. To accomplish these goals, the Debtor has endeavored to achieve consensus among their key creditor constituency regarding the form and substance of the restructuring and the Plan.”
The Federal Energy Regulatory Commission on Nov. 14 had approved a Sept. 16 application related to the bankruptcy sale of interests in several wind generating facilities controlled by Noble.
The applicants for this approval were Noble Altona Windpark LLC, Noble Bliss Windpark LLC, Noble Chateaugay Windpark LLC, Noble Clinton Windpark I LLC, Noble Ellenburg Windpark LLC, Noble Great Plains Windpark LLC and Noble Wethersfield Windpark LLC. They sought commission authorization for their upstream owner, Noble Environmental Power (Noble Power), to transfer 100% of its ownership interests to Paragon Noble LLC.
Noble Power is a renewable energy holding company. The upstream ownership of Noble Power is divided into several classes of interests. The voting interests in Noble Power are owned 54% by Paragon Noble, 28% by JPMP Wind Energy (Noble) LLC, 14% by CPP Investment Board (USRE II) Inc. (USRE II), and 4% by individuals, trusts and limited liability companies (called the Management Investors).
MSD Capital LP (MSD Capital) is an investment firm that owns more than 90% of Paragon Noble. MSD Capital Management LLC is the sole general partner of MSD Capital, which was formed to manage the capital of Michael S. Dell and his family.
Each of the applicants is an exempt wholesale generator with market-based rate authority and an indirect subsidiary of Noble Power. Except for the wind energy project owned by Noble Great Plains, which is located within the Southwest Power Pool market, each of the wind energy projects owned by the applicants is located in the New York Independent System Operator (NYISO) market.
- Noble Altona owns and operates a 97.5-MW generating facility in Altona, New York.
- Noble Bliss owns and operates a 100.5-MW generating facility in Wyoming County, New York.
- Noble Clinton owns and operates a 100.5-MW generating facility in the Town of Clinton, New York.
- Noble Ellenburg owns and operates an 81-MW generating facility in the Town of Ellenburg, New York.
- Noble Chateaugay owns and operates a 106.5-MW generating facility near the Town of Chateaugay, New York.
- Noble Great Plains owns and operates the Great Plains Project, a 114-MW generating facility in Hansford County, Texas.
- Noble Wethersfield owns and operates a 126-MW generating facility near the Town of Wethersfield, New York.
Paragon Noble currently has no energy related assets other than through its interest in Noble Power. Further, apart from the applicants, MSD Capital does not own or control any electric generation capacity within the Southwest Power Pool or New York ISO markets.
FERC noted in the Nov. 14 approval: “According to Applicants, the Proposed Transaction shall consist of a Chapter 11 bankruptcy proceeding in order to cancel the existing ownership interests in Noble Power and issue 100 percent of the new ownership interests in Noble Power to the existing majority owner and secured lender, Paragon Noble, in exchange for various beneficial modifications of the existing loan, including the reduction of a portion of the principal amount of the debt, a reduction of interest rate, and extension of maturity date. Applicants represent that because Paragon Noble is the existing majority owner of Noble Power, control of Noble Power will not change.”