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To keep its nationwide bankruptcy liquidation from crashing to a halt, Sports Authority Holdings Inc. has cut a deal with senior lenders that portends bad news ahead for landlords and suppliers to the failed sports retailer, the Wall Street Journal reported today. Going-out-of-business sales are still in full swing at many stores, as liquidators sell off the last bicycles, skateboards and rest of the gear and apparel still on the shelves. Sports Authority auctioned off its intellectual property, which is going to high-bidder Dick’s Sporting Goods, for $15 million, and some leases. But in a court filing on Tuesday, Sports Authority admitted what creditors’ lawyers predicted early in the case — banks are claiming all the money rung up in the company’s last days. Without a deal, lenders will be poised on Friday to shut off the funds to Sports Authority, forcing an abrupt shutdown, court papers say. “So as to prevent these chapter 11 cases from coming to a grinding halt,” Sports Authority agreed to compromise legal disputes with the lenders, a group that is led by Wilmington Savings Fund Society. In a separate motion, Sports Authority revealed lenders have agreed to fund up to $2.85 million in bonuses to senior executives of the dying company. Under the proposal, four top executives are in line for up to $1.5 million in bonuses. Sports Authority won’t identify those getting bonuses at the end of a bankruptcy that cost 14,000 people their jobs. By Friday, Sports Authority will have paid off its top layer of debt from liquidation proceeds. Lenders claim to be owed an additional $240 million, a figure that includes loss of value in their collateral during the bankruptcy.

Top-ranked bondholders of Lightstream Resources Ltd. could take control of the struggling Canadian energy company under a proposed debt-for-equity swap, dealing another blow to creditors left out of a previous rescue plan, Bloomberg News reported yesterday. The oil producer, facing a July 15 deadline to make an interest payment, tentatively agreed to give secured noteholders a 95 percent equity stake. The deal includes forbearance on Lightstream’s overdrawn revolving credit line while the company works out a plan to stay in business, according to the statement. If that doesn’t work, Lightstream said that it hired TD Securities Inc. to sell the business or its assets. Lightstream is struggling to stay afloat amid a two-year crude market rout that has driven 85 North American oil and gas producers into bankruptcy since the beginning of 2015, according to Haynes & Boone LLP. Calgary-based Lightstream was sued over a debt exchange last year that gave funds run by Apollo Global Management LLC and Blackstone Group LP’s GSO Capital Management second-lien claims on assets, pushing earlier debt investors further back in the line for a payout in a restructuring.

Oil-field-services provider Seventy Seven Energy Inc. is preparing to get out of bankruptcy after a judge agreed to approve a reorganization plan that would give the Oklahoma company access to up to $100 million in a new borrowing deal, the Wall Street Journal reported today. Bankruptcy Judge Laurie Selber Silverstein said in court yesterday that she would give Seventy Seven Energy permission to put its reorganization plan into action. The plan would allow bondholders owed $1.1 billion to take over most of the ownership in the company, which provides drilling, hydraulic fracturing and oilfield-rental services to exploration and production companies. Under the company’s reorganization plan, its unsecured debt would be fully paid. Shareholders would receive warrants for 20 percent of new common stock. Seventy Seven Energy filed for bankruptcy on June 7, facing roughly $1.7 billion in debt.

Venoco Inc. won bankruptcy-court approval yesterday for a restructuring plan that will slash nearly $1 billion in debt from the oil and gas producer’s books, the Wall Street Journal reported today. Bankruptcy Judge Kevin Gross confirmed Venoco’s chapter 11 plan of reorganization, paving the way for the Denver-based company to exit bankruptcy protection. Smoothing the way for Venoco to secure the court’s approval was an early settlement of potential legal claims by one major bondholder and a last-minute deal to resolve the objections to the restructuring from two other bondholders. Amid the decline in oil and gas prices, Venoco sought chapter 11 protection in March after securing support for its restructuring from secured bondholders Apollo Capital Management and MAST Capital Management. Apollo, a unit of New York-based Apollo Global Management, and Boston-based MAST agreed to forgive some $339 million in first- and second-lien bond debt in exchange for most of the new equity in the restructured Venoco. Apollo representatives are also slated to get three of the company’s four board seats when it leaves bankruptcy, Venoco lawyer Robert Burns said at yesterday’s hearing. Read more. (Subscription required.) 

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Don’t miss the Great Debate at ABI’s Views from the Bench conference on Oct. 7, as Judge Robert Gerber (ret.) & Goodwin Procter's William Weintraub debate whether §363 sales lawfully be free and clear of successor-liability claims. The early bird rate expires on Friday, so please register here! 

All the chapter 11 filings from Pacific Andes group companies will be administrated in the U.S. together, with the company willing to meet with lenders alleging some $1 billion of suspicious transactions, Undercurrent News reported yesterday. During a hearing in New York on July 11, the court approved the motion by the group for joint administration under chapter 11. In addition, the company’s counsel “confirmed their willingness to meet with counsel representing creditors on July 14, 2016 in an effort to address outstanding issues between the parties.” The group indicated to the court that the motion relating to cash management would likely be made by the end of this week after consultation with counsel to the club lenders on a confidential and non-disclosed basis later this week. This comes after four Pacific Andes lenders filed a document on July 8, alleging there are $1 billion in "questionable transactions" in the group and suspicions of "substantial" fabrications of revenue and payments.

The owner of the shuttered Cal Neva Lodge & Casino once owned by Frank Sinatra has filed for bankruptcy protection, again jeopardizing plans to reopen the historic resort on the shores of north Lake Tahoe, the Associated Press reported yesterday. Criswell-Radovan, a California-based developer, purchased the property in 2013 with ambitious renovation plans. Tahoe Regional Planning Agency officials hope the developer follows through with plans to reopen the 10-story hotel and 6,000-square-foot casino straddling the California-Nevada border. Criswell-Radovan has canceled numerous announced grand openings for the property over the last several years, most recently this spring. Criswell-Radovan owed more than $27 million last month to creditors affiliated with the project, including $7 million to the lead contractor, the Las Vegas-based Penta Building Group.

Lawyers for Gawker Media LLC say that founder and Chief Executive Nick Denton will join his media company in bankruptcy unless a judge steps in to block litigation from former professional wrestler Hulk Hogan and his billionaire backer, the Wall Street Journal reported today. Gawker’s lawyers said in court papers filed on Monday that the personal bankruptcy filing “would undoubtedly occur” if a judge rejects Gawker’s bid for an injunction that would halt legal action from Terry Bollea, the wrestler’s real name, as well as others who have sued the embattled publisher. William Holden, Gawker’s chief turnaround officer, said in sworn testimony that Denton has already hired bankruptcy lawyers using a $200,000 loan from the company. Bollea won a $140 million judgment against Gawker earlier this year that ultimately pushed the company into chapter 11. The invasion-of-privacy suit was tied to a tape of Bollea having sex, which Gawker published in 2012. Denton is jointly liable along with another former Gawker employee for $115 million of the judgment and is personally liable for another $10 million.

C&J Energy Services Ltd. said yesterday that it has entered into a restructuring support agreement (RSA) with certain of its secured lenders representing greater than 50 percent of the outstanding principal amount under the Company’s secured credit facility, according to a company press release. The terms of the RSA provide for the implementation of a restructuring that contemplates, among other things, a debt-to-equity conversion of the entire secured credit facility and an equity rights offering through a chapter 11 plan of reorganization. The restructuring will enable the company to deleverage its balance sheet — eliminating approximately $1.4 billion of existing debt — while continuing daily operations in the normal course. Read more. 

Listen to a panel of experts drill down through the issues involved in an oil and gas bankruptcy at ABI's 23rd Annual Northeast Bankruptcy Conference starting on Thursday at the Omni Mount Washington Resort in Bretton Woods, N.H. Register here.

Get a better understanding of what happens when an oil, gas or other natural resources company goes bankrupt. Order your copy of ABI's revised and expanded When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy, Second Edition.