IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE

Transcription

1 Case KG Doc 110 Filed 12/09/13 Page 1 of 8 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: ) Chapter 11 FISKER AUTOMOTIVE HOLDINGS, INC., et al.,' ) ) Case No (KG) Debtors. ) ) Jointly Administered ) ) Related to Docket Nos. 15, 16, 39 ) LIMITED RESPONSE AND RESERVATION OF RIGHTS OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS TO THE MOTION OF THE DEBTORS FOR ENTRY OF AN ORDER (A) APPROVING THE ADEQUACY OF THE DEBTORS' DISCLOSURE STATEMENT, (B) APPROVING SOLICITATION AND NOTICE PROCEDURES WITH RESPECT TO CONFIRMATION OF THE DEBTORS' PROPOSED JOINT PLAN OF LIQUIDATION, (C) APPROVING THE FORM OF VARIOUS BALLOTS AND NOTICES IN CONNECTION THEREWITH, (D) SCHEDULING CERTAIN DATES WITH RESPECT THERETO, AND (E) GRANTING RELATED RELIEF The Official Committee of Unsecured Creditors (the "Committee") appointed in the above-captioned proceedings (the "Chapter 11 Cases") of Fisker Automotive Holdings, Inc., et al. (the "Debtors" or "Fisker"), by and through its proposed co-counsel, hereby submits this limited response and reservation of rights (the "Committee Response") in connection with the Motion of the Debtors for Entry of an Order (A) Approving the Adequacy of the Debtors' Disclosure Statement, (B) Approving Solicitation and Notice Procedures with Respect to Confirmation of the Debtors' Proposed Joint Plan of Liquidation, (C) Approving the Form of Various Ballots and Notices in Connection Therewith, (D) Scheduling Certain Dates with The Debtors, together with the last four digits of each Debtor's federal tax identification number, are Fisker Automotive Holdings, Inc. (9678) and Fisker Automotive, Inc. (9075). The service address for the Debtors is 5515 East La Palma Avenue, Anaheim, California

2 Case KG Doc 110 Filed 12/09/13 Page 2 of 8 Respect Thereto, and (E) Granting Related Relief [Docket No. 39] (the "Disclosure Statement Motion"). 2 In support hereof, the Committee respectfiffly states as follows: BACKGROUND 1. The Debtors commenced these Chapter 11 Cases by filing Voluntary Petitions [Docket No. 1] on November 22, On November 24, 2013, Fisker filed the Motion of the Debtors for the Entry of (1) An Order (A) Approving Form and Manner of Notices and (B) Scheduling a Sale Hearing and Establishing Dates and Deadlines Related Thereto; and (II) An Order (A) Authorizing the Sale of Substantially All of the Debtors' Assets Free and Clear of Liens, Claims, Encumbrances, and Other Interests, (B) Granting the Purchaser the Protections Afforded to a Good Faith Purchaser, and (C) Granting Related Relief [Docket No. 13] and Motion of the Debtors for Entry of Interim and Final Orders (I) Authorizing Postpetition Financing, (II) Granting Liens and Providing Superpriority Administrative Expense Priority, (III) Authorizing Use of Cash Collateral, (IV) Granting Adequate Protection, (V) Modifying the Automatic Stay, and (VI) Scheduling a Final Hearing Pursuant to Sections 105, 361, 362, 363 and 364 of the Bankruptcy Code and Bankruptcy Rules 2002, 4001, and 9014 [Docket No. 17]. 3. As set forth therein and in the Declaration of Marc Beilinson in Support of First Day Motions [Docket No. 3] (the "Beilinson Declaration"), the Debtors propose to sell substantially all of their assets to Hybrid Tech Holdings, LLC ("Hybrid") in a private sale for, among other consideration, a $75 million credit bid and the waiver of $4 million in DIP Facility Claims. See Beilinson Declaration 51. An affiliate of Hybrid is both the postpetition lender to 2 Capitalized terms used but not defined herein have the meanings given them in the Disclosure Statement Motion. 2

3 Case KG Doc 110 Filed 12/09/13 Page 3 of 8 the Debtors and the holder of the Department of Energy's interests in its prepetition loan to the Debtors. See id. TIT Also on November 24, 2013, Fisker filed the Debtors' Joint Plan of Liquidation Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 15] (the "Plan") and attendant Disclosure Statement for the Debtors' Joint Plan of Liquidation Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 16] (the "Disclosure Statement"). On November 25, 2013, the Disclosure Statement Motion was filed with the Court. 5. On December 5, 2013, the United States Trustee for Region 3 appointed a sevenmember Committee in these Chapter 11 Cases. See Notice of Appointment of Committee of Unsecured Creditors [Docket No. 102]. The Committee has selected Brown Rudnick LLP and Saul Ewing LLP as its proposed co-counsel. LIMITED RESPONSE 6. Given the highly compressed time frame established by the Debtors in these cases, the Committee has commenced, but has not yet concluded, its diligence relating to the Prepetition Loans, the proposed Sale, and the proposed Plan and Disclosure Statement. As a result, the Committee is not yet able to formulate an informed and responsible view regarding the adequacy of the Disclosure Statement and whether, in the Committee's view, creditors should vote to accept or reject the Plan. Nonetheless, the Committee endeavors to work cooperatively with the Debtors and the Buyer to complete its diligence in due course, and prior to the Voting Deadline, make a formal recommendation to unsecured creditors regarding whether to vote to accept or reject the Plan, and, prior to the confirmation hearing currently scheduled for January 3, 2014, raise objections, if any, to the Disclosure Statement and/or Plan. To aid in this effort, the Committee requests that the Court, upon approval of the Disclosure Statement and 3

4 Case KG Doc 110 Filed 12/09/13 Page 4 of 8 Solicitation Procedures, order that (i) a provisional recommendation from the Committee regarding the Plan shall be included in the Solicitation Packages to be sent to creditors and, (ii) once the Committee completes its due diligence relating to the Plan, its final recommendation to creditors shall be distributed by the Claims and Noticing Agent to all holders of unsecured claims against the Debtors. 7. As the Court well knows, the Committee has the duty to "participate in the formulation of a plan, advise those represented by such committee of such committee's determinations as to any plan formulated, and collect and file with the court acceptances or rejections of a plan." 11 U.S.C. 1103(c)(3); see also 7 Collier on Bankruptcy SW [b] ("The first duty of a committee under section 1103(c) is to consult with the trustee or the debtor in possession concerning the administration of the estate. The debtor and the committee have a common goal in the chapter 11 case the confirmation of plan of reorganization generating the maximum return to creditors and, if possible, equity security holders."); In re The A.C. Williams Co., 24 B.R. 173, 177 (Bankr. N.D. Ohio 1982) (committees have "duty to consult with the debtor/debtor-in-possession regarding the disclosure statement as the same [a]ffects the creditors whom they represent"). 8. To discharge these duties, official committees engage in a thorough and careful analysis of a debtor's disclosure statement and proposed plan to ensure the rights and entitlements of unsecured creditors are fully protected. Upon completion of this process, committees typically make a recommendation to creditors whether to vote to accept or reject a debtor's proposed plan. Such recommendations are routinely distributed with the disclosure statement when creditor votes are solicited. See, e.g., In re Rural/Metro Corp., et al., Case No (IOC) (Bankr. D. Del. Nov. 1,2013) [Docket No. 592]; In re School Specialty, Inc. et 4

5 Case KG Doc 110 Filed 12/09/13 Page 5 of 8 al, Case No (MC) (Bankr D. Del. April 24, 2013) [Docket No. 872]; In re A123 Systems, Inc., et al., Case No (10C) (Bankr. D. Del. March 14, 2012) [Docket No. 1239]. 9. Here, we are in an unusual circumstance where the Debtors have established an extraordinarily accelerated schedule for the provisional approval of a Disclosure Statement less than a week after Committee formation and the final approval of a private sale of substantially all of the Debtors' assets and confirmation of a Plan less than 25 days thereafter. The Committee, formed only 4 days ago, has only just begun its diligence and has not yet selected its financial advisor. And, as this Court is aware, unsecured creditors have raised concerns regarding the disclosure, and preservation, of potential estate causes of action and, especially important to trade creditors, information regarding what the reorganized Fisker will look like upon emergence, especially as to the viability of its post-emergence business plan. 10. Indeed, at the hearing on November 26, 2013, the Court heard concerns from certain creditors regarding the Debtors' proposed timeline for distribution of the Disclosure Statement and solicitation of votes from creditors on the Plan. In response to these concerns, and following a conference with counsel to these creditors, the Debtors proposed "proceed[ing] with solicitation potentially provisionally," Nov. 26, 2013 Ileg Tr. at 87:11-12, to allow the Committee, if necessary, to "persuade[] the Court that we haven't carried our burden for adequate disclosure, conditionally or otherwise, [and] the Court would certainly be able free to continue out the confirmation schedule to an appropriate time," id. at 87:24-88:3; see also id. 85:13-17 ("the concession made by the debtors today that objections to disclosure be provisional and that or the approval of the disclosure statement be provisional subject to later objections we [creditors] support"). The Court then scheduled December 10, 2013 "for disclosure /

6 Case KG Doc 110 Filed 12/09/13 Page 6 of 8 statement hearing, with the understanding, of course, that the committee will have been formed by then and may object to timing or whatever." Id. at 88: The Committee is working cooperatively and constructively with the Debtors and the Buyer to conduct its required due diligence regarding the Prepetition Loans, the proposed Sale, and the proposed Plan and Disclosure Statement. Of course, given that the Committee was just formed days ago and these cases are proceeding on an unparalleled track for a nonprepackaged chapter 11 case, further work is required by the Committee before it will be in a position to make an informed and responsible recommendation to unsecured creditors regarding acceptance or rejection of the Plan. See 11 U.S.C. 1103(c)(2) (committees have power and duty to "investigate the acts, conduct, assets, liabilities and financial condition... and any other matter relevant to the case or to the formulation of a plan"); 7 Collier on Bankruptcy [1][c][i] ("In order to be able to analyze whether there should be a plan, and also, what type of plan is most appropriate in the case, the committee must first understand the nature of the debtor's business and the source of the debtor's financial distress."). 12. To allow the Committee to complete its diligence, without delaying the distribution of the Debtors' Disclosure Statement, the Committee requests that the Debtors' Solicitation Packages include a preliminary letter from the Committee, substantially in the form attached hereto as Exhibit A (the "Preliminary Committee Letter"). The Preliminary Committee Letter will inform unsecured creditors of the recent appointment of the Committee, explain that the Committee is charged with, and in the process of, evaluating the Plan and particularly the treatment of unsecured creditors under that Plan, and that the Committee intends to distribute a -6

7 Case KG Doc 110 Filed 12/09/13 Page 7 of 8 supplement to the Preliminary Committee Letter (the "Committee Recommendation") to recommend that creditors vote to accept or reject the Plan To ensure that the Committee Recommendation is received by as many unsecured creditors as possible prior to the Voting Deadline, the Committee further requests that any order approving the Disclosure Statement Motion provide for the Debtors' Claims and Noticing Agent, within 24 hours of the delivery of the Committee Recommendation to the Debtors, to (i) distribute the Committee Recommendation (in the same manner that the Solicitation Packages were distributed) to all recipients of the Solicitation Packages and (ii) prominently display a link to the Committee Recommendation on the website of the Debtors' Claims and Noticing Agent, located at Finally, the Committee requests that any order approving the Disclosure Statement Motion explicitly provide that the Preliminary Committee Letter and Committee Recommendation are protected as solicitation materials compliant with and governed by section 1125(e) of the Bankruptcy Code and, to the fullest extent permitted by law, that the Committee and its counsel and other representatives shall incur no liability relating to the distribution of the Preliminary Committee Letter or Committee Recommendation to unsecured creditors The Committee reserves the right to expressly identify in the Committee Recommendation any claims, causes of action or other estate causes of action that may exist against the Released Parties or others in order to preserve any such claims, causes of action or estate causes of action for the benefit of unsecured creditors in accordance with sections 1123 and 1125 of the Bankruptcy Code. See, e.g., In re Rural/Metro Corp., et al., Case No (KJC) (Bankr. D. Del. Nov. 5, 2013) [Docket No. 597], 44 ("In accordance with section 1125(e) of the Bankruptcy Code, to the fullest extent permitted by law, none of the Debtors or the Creditors' Committee (including each of their respective directors, officers, employees, shareholders, members, partners, agents, or representatives (including attorneys, accountants, financials advisors, and investment bankers), each solely in their capacity as such) shall have any liability on account of soliciting votes on the Plan or participating in such solicitation, for violation of any applicable law, rule, or regulation governing solicitation of acceptance or rejection of a plan or the offer, issuance, sale, or purchase of securities."). -7-

8 Case KG Doc 110 Filed 12/09/13 Page 8 of 8 RESERVATION OF RIGHTS 15. The Committee reserves all rights with regard to the Debtors Disclosure Statement Motion, Disclosure Statement, and Plan, including but not limited to the right to object to the Disclosure Statement at a later date and otherwise to object to confirmation of the Plan on any basis. WHEREFORE, the Committee respectfully requests that the Court (i) grant the relief requested herein, (ii) modify any order granting the Disclosure Statement Motion accordingly, and (iii) grant the Committee such other and further relief as is equitable and proper. Dated: December 9, 2013 SAUL.,EWING LLP By: Mark Minuti (DE Bar ( ) Lucian B. Murley (DE Bar No. 4892) 222 Delaware Avenue, Suite 1200 P.O. Box 1266 Wilmington, DE Telephone: (302) Facsimile: (302) and - BROWN RUDNICK LLP William R. Baldiga Seven Times Square New York, NY Telephone: (212) Facsimile: (212) Sunni P. Beville Nicolas M. Dunn One Financial Center Boston, MA Telephone: (617) Facsimile: (617) Proposed Co-Counsel to the Official Committee of Unsecured Creditors -8-

9 Case KG Doc Filed 12/09/13 Page 1 of 3 EXHIBIT A

10 Case KG Doc Filed 12/09/13 Page 2 of 3 OFFICIAL COMMITTEE OF UNSECURED CREDITORS OF FISICER AUTOMOTIVE HOLDINGS, INC., ET AL. c/o Brown Rudnick LLP Seven Times Square New York, New York c/o Brown Rudnick LLP One Financial Center Boston, Massachusetts c/o Saul Ewing LLP 222 Delaware Avenue, Suite 1200 Wilmington, Delaware December [12], 2013 TO: THE HOLDERS OF UNSECURED CLAIMS AGAINST FISKER AUTOMOTIVE HOLDINGS, INC. OR FISICER AUTOMOTIVE, INC. On November 5, 2013, the Official Committee of Unsecured Creditors (the "Committee") was appointed in the bankruptcy cases of Fisker Automotive Holdings, Inc., et al. ("Fisker"), to represent the interests of the Debtors' unsecured creditors. Under the Bankruptcy Code, the Committee is charged with the responsibility, on behalf of unsecured creditors generally, to investigate and evaluate Fisker's business operations and financial condition and its proposed plan of reorganization, and to then make a recommendation to creditors as to whether to vote to accept or reject that plan. We write to advise you that, since its formation only a few days ago, the Committee, with its proposed co-counsel Brown Rudnick LLP and Saul Ewing LLP, has begun that work, and at present is having a constructive dialogue with Fisker and with the proposed Buyer of Fisker's assets to obtain the information necessary to recommend to you whether to vote to accept, or reject, the Debtors' Joint Plan of Liquidation Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 15] (the "Plan") and Disclosure Statement for the Debtors' Joint Plan of Liquidation Pursuant to Chapter 11 of the Bankruptcy Code [Docket No. 16] (the "Disclosure Statement"). The Committee's work in that regard is in its early stages, and so we cannot yet make that recommendation. Upon completion of our work, and in advance of the December 30, 2013 deadline for unsecured creditors to vote to accept or reject the Plan, the Committee will announce whether it supports the Plan and the reasons therefor, and will make a recommendation that you vote to accept or reject the Plan (collectively, the "Committee Recommendation"). At this time, given the very early stage of our work, THE COMMITTEE RECOMMENDS THAT CREDITORS NOT YET SUBMIT ANY BALLOT, AND THAT YOU WAIT UNTIL THE COMMITTEE MAKES A RECOMMENDATION BEFORE SUBMITTING YOUR BALLOT TO ACCEPT OR REJECT THE PLAN. As soon as possible, the Committee Recommendation will be distributed to recipients of this letter and made available on the website of Fisker's Claims and Noticing Agent, located at http :// com/fiskerautomotive.

11 Case KG Doc Filed 12/09/13 Page 3 of 3 In the interim, if you have any questions concerning the Plan or Disclosure Statement, please contact Sunni P. Beville at Brown Rudnick. Sunni can be reached by telephone at (617) or by at sbeville@brownrudnick.com. Thank you /

12 Case KG Doc Filed 12/09/13 Page 1 of 2 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: ) Chapter 11 FISKER AUTOMOTIVE HOLDINGS, INC., et al., ) Case No (KG) Debtors. ) Jointly Administered CERTIFICATE OF SERVICE I, Lucian B. Murley, hereby certify that on December 9, 2013, I caused a copy of the foregoing Limited Response and Reservation of Rights of the Official Committee of Unsecured Creditors to the Motion of the Debtors for Entry of an Order (A) Approving the Adequacy of the Debtors' Disclosure Statement, (B) Approving Solicitation and Notice Procedures with Respect to Confirmation of the Debtors' Proposed Joint Plan of Liquidation, (C) Approving the Form of Various Ballots and Notices in Connection Therewith, (D) Scheduling Certain Dates with Respect Thereto, and (E) Granting Related Relief to be served on the parties on the attached Service List in the manner indicated therein. SAUL EWING LLP Dated: December 9, 2013 By: Mark Minuti (DE o. 2659) Lucian B. Murley (DE Bar No. 4892) 222 Delaware Avenue, Suite 1200 P.O. Box 1266 Wilmington, DE Telephone: (302) Facsimile: (302)

13 Case KG Doc Filed 12/09/13 Page 2 of 2 FISKER AUTOMOTIVE HOLDINGS, INC., et at. Service List Via Hand Delivery: Laura Davis Jones, Esquire James O'Neill, Esquire Peter J. Keane, Esquire Pachulski Stang Ziehl & Jones LLP 919 North Market Street, 17th Floor P.O. Box 8705 Wilmington, DE Mark Kenney, Esquire Office of The United States Trustee 844 King Street, Suite 2207 Lockbox 35 Wilmington, DE Richard A. Barkasy, Esquire Fred W. Hoensch, Esquire Schnader Harrison Segal & Lewis LLP 824 N. Market Street, Suite 800 Wilmington, DE Via Electronic Mail: James H.M. Sprayregen, Esquire Anup Sathy, Esquire Ryan Dahl, Esquire Kirkland and Ellis LLP 300 North La Salle Street Chicago, IL Tobias S. Keller, Esquire Peter Benvenutti, Esquire Keller & Benvenutti LLP One Montgomery Tower, Suite 2200 San Francisco, CA /