Oct. 17 (Bloomberg) -- Satcon Technology Corp., which makes equipment that converts solar-cell energy for use on power grids, filed for bankruptcy after defaulting on some debt earlier this month.
The company, based in Boston, listed assets of $92.3 million and debt of $121.9 million as of June 30 in Chapter 11 documents filed today in U.S. Bankruptcy Court in Wilmington, Delaware. Six units also entered bankruptcy.
Satcon’s board “determined that the Chapter 11 filings were a necessary and prudent step,” Chief Executive Officer Steve Rhoades said in a statement. Satcon will have “the opportunity to reorganize with a stronger balance sheet and capital structure,” he said.
Satcon said it expects to get consent from secured lenders to use cash collateral to finance operations. The company in February announced a manufacturing partnership to supply solar-plant equipment to a unit of China Electronics Corp.
Satcon missed an Oct. 1 payment on a $16 million unsecured subordinated convertible note, the company said Oct. 11 in a U.S. Securities and Exchange Commission filing. A notice from the noteholder gave Satcon five days to pay $7.5 million, or 120 percent of the outstanding principal, plus accrued and unpaid interest.
The company’s failure to pay the note when due constituted a default under its credit agreement with Silicon Valley Bank, according to the SEC filing.
Among Satcon’s largest unsecured creditors listed in court papers are Perfect Galaxy International Ltd. of Hong Kong, owed $25.6 million in trade debt; and Heights Capital Management of San Francisco, holders of $10 million in convertible notes.
Satcon hired Greenberg Traurig LLP as general bankruptcy counsel. Lazard Middle Market LLC will serve as financial adviser and investment banker, according to the filing.
The case is In re Satcon Technology Corp., 12-12869, U.S. Bankruptcy Court, District of Delaware (Wilmington)
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