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Irate shareholders of Horsehead Holding Corp won backing on Monday from a U.S. judge for an official role in the zinc producer's chapter 11 case, sending its stock soaring, Reuters reported yesterday. Stockholders had argued that they felt misled by the company's sudden bankruptcy filing in February, which came after the largest U.S. zinc producer indicated it had sufficient funds for its operations. "Something doesn't smell right to the court," Bankruptcy Judge Christopher Sontchi said as he approved appointing an official equity committee. The campaign for an official shareholder committee in the Horsehead case was led by investment fund manager Guy Spier and Phil Town, the author of a 2006 New York Times best-seller, "Rule #1."

Dex Media Inc. reached an agreement with some of its creditors yesterday on a plan to enter chapter 11 protection, setting in motion the company’s third trip to bankruptcy court in less than a decade, Bloomberg News reported yesterday. The plan comes after months of negotiations with creditors. If approved, it will help the phone-book publisher cut its $2.42 billion in debt and simplify its capital structure, according to a statement from the company. Dallas-based Dex has been discussing a debt reorganization with holders of its more than $2 billion of loans since last fall and has been wrangling with a group of junior bondholders that considered putting the company into involuntary bankruptcy after it skipped an interest payment on Sept. 30. Lenders holding $2.1 billion of Dex’s loans must vote on the proposal by May 16, while holders of $270 million of subordinated notes must consent by May 30, according to the disclosure statement for the plan. The company said that it has support for the pre-packaged reorganization plan from a majority of its bondholders and creditors controlling two-thirds of its loans.

Bankruptcy Judge Benjamin Goldgar ruled yesterday that creditors of the bankrupt operating unit of Caesars Entertainment Corp will have an additional 15 days to decide if they object to the casino company's bankruptcy exit plan, which still lacks key details, Reuters reported. "It's hard to shoot a moving target," Judge Goldgar said at an emergency hearing before postponing the deadline for creditor objections to May 17. He was responding to junior creditors' complaints in a court filing that the plan omits "virtually all of the information that creditors actually care about." Objections to the plan were initially due on yesterday. At the heart of the uncertainty is how much Caesars, backed by private equity groups Apollo Global Management LLC and TPG Capital Management, will contribute to its unit's reorganization. The reorganization plan envisions splitting the bankrupt unit into an operating company and a real estate investment trust. Creditors have accused the parent of stripping the operating unit of its best hotel and casino assets prior to a $18 billion bankruptcy filing in January 2015 and are demanding compensation. Caesars has denied the allegations. A court-appointed examiner found in March that Caesars could be on the hook for between $3.6 billion and $5.1 billion for pre-bankruptcy transactions.

Core Entertainment Inc., the company behind the “American Idol” TV series, won approval from a bankruptcy judge on Friday to tap its lenders’ cash and move forward with its chapter 11 proceedings, the Wall Street Journal reported today. Bankruptcy Judge Stuart Bernstein approved Core’s first-day motions, including paying its employees and its taxes. Core, as well as Los Angeles-based 19 Entertainment Ltd., and related companies that own and produce content for the global “American Idol” franchise, and “So You Think You Can Dance,” and “Prison Wives,” sought chapter 11 protection on Wednesday. The company has yet to secure a bankruptcy loan, but it is still negotiating with its lenders, Core’s lawyers said in court on Friday.

The official keeping an eye on the professional fee meter in the Caesars Entertainment Operating Co. bankruptcy says the recent hourly rate increases at various law firms working on the case — some of which brought top rates close to the $1,500-per-hour mark — deserve a deeper dive, the Wall Street Journal reported on Saturday. Nancy Rapoport, a law professor and independent member of the committee monitoring professionals’ fees, says that the four-figure rates themselves aren’t necessarily the issue. Rather, “the controlling issue here is whether the clients of those firms are paying those rates,” she wrote, requesting evidence that a firm’s bankruptcy and non-bankruptcy clients alike each pay those rates — i.e., that there is no bankruptcy premium. Rapoport’s remarks came in conjunction with the fee committee’s review of the third round of fee applications in Caesars Entertainment’s chapter 11 case, filed in court this week. She said that the latest bills in the casino company’s $18 billion restructuring “triggered fewer areas of concern” than prior bills but still required some fee reductions tied to staffing and expenses like travel, hotels and meals.

Two more publicly traded oil and natural gas companies, with combined debts of more than $5.8 billion, filed for chapter 11 bankruptcy protection in Texas as the industry continues to suffer amid stubbornly low prices, Dow Jones Newswires reported yesterday. Houston'sUltra Petroleum Corp. and Oklahoma-based Midstates Petroleum Co. separately filed for court protection Friday in U.S. Bankruptcy Court in Houston. Ultra, which has some $3.8 billion in debt — all of it unsecured — filed for bankruptcy after failing to reach a debt-restructuring deal with its lenders and bondholders, according to an affidavit filed by Chief Financial Officer Garland R. Shaw. Both companies, in court filings, pointed to persistently low commodity prices as the reason for their financial woes. Ultra, with 159 full-time employees, operates mainly in Wyoming's Pinedale Field, which produces natural gas. The company also owns properties in Utah, which produce primarily crude oil, and Pennsylvania, which produce natural gas. Midstates, which has 120 full-time workers, drills for crude and natural gas in Texas and Oklahoma. Read more. 

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. 

Energy Future Holdings Corp, the largest power company in Texas, marked the two-year anniversary of its $42 billion bankruptcy by essentially hitting the reset button and unveiling on Sunday a new chapter 11 exit plan, Reuters reported. The plan comes after investors withdrew their support last week for acquiring Energy Future's crown jewel, its Oncor power distribution business. That deal, valued at up to $20 billion, was led by Energy Future's creditors and Hunt Consolidated Inc of Dallas, and was meant to fund the prior bankruptcy exit plan. The company is seeking an even quicker schedule to exit Chapter 11 and asked for a hearing to confirm its new plan on Aug. 1. Like the original plan, Energy Future proposes spinning off its power plants and retail electricity business to senior creditors. Unlike the prior plan, the new plan allows those creditors to take control of those assets without waiting for a deal for the Oncor side of Energy Future's business. Under the new plan, creditors of the Oncor side of Energy Future could take control of the distribution business, or it could be sold.

A trucking company that works at California’s teeming ports of Los Angeles and Long Beach has filed for bankruptcy protection, facing a demand to pay nearly $7 million to its truck drivers over a labor dispute, the Wall Street Journal reported today. Pacific 9 Transportation’s bankruptcy filing on Tuesday halts collection attempts from drivers who have fought for back pay, arguing the Carson, Calif., company improperly classified them as independent contractors instead of employees. Last month, a judge finalized the payment award amounts, which vary for each driver. Pacific 9 Transportation’s bankruptcy-court records show one driver in Inglewood, Calif., is owed $186,304.26, while another from Rialto, Calif., could collect $336,999.11. The 75-worker company will continue to operate during the case, which will give the company time to figure out a debt repayment plan, said Pacific 9 Transportation lawyer Vanessa Haberbush.

Pacific Exploration & Production Corp said an Ontario court approved a $500 million debtor-in-possession financing facility for the Canadian company and its units, hours after it filed for creditor protection, Reuters reported yesterday. The Ontario Superior Court of Justice also approved a $134 million letter-of-credit facility and second-priority lien over assets under the facility, Pacific Exploration said. The company said earlier in the day that it had filed for protection from creditors under the Companies' Creditors Arrangement Act, an insolvency law in Canada that allows companies to restructure their finances and stay in business. Pacific Exploration said it also plans to file for protection under chapter 15 in the U.S. Pacific Exploration reached a deal last week with creditors, including Catalyst Capital Group Inc., to convert almost all of its debt to equity after it missed an interest payment due in March. Read more. 

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