Louisiana Pellets, German Pellets Louisiana file Chapter 11 bankruptcy

By Caroline Salls

Pittsburgh, Feb. 18 – Louisiana Pellets, Inc. and German Pellets Louisiana, LLC filed Chapter 11 bankruptcy on Feb. 18 in the U.S. Bankruptcy Court for the Western District of Louisiana, according to a notice from Louisiana Public Facilities Authority revenue bond trustee UMB Bank, NA.

The trustee said it is in talks with the debtors regarding the bankruptcy proceedings.

A status conference on the bankruptcy filing and progress made toward confirmation of a Chapter 11 plan is scheduled for July 6.

According to court documents, Louisiana Pellets has $100 million to $500 million in both assets and debt. German Pellets listed $50 million to $100 million in both assets and debt.

As previously reported, Louisiana Pellets failed to make $4.83 million in payments due Jan. 1 on the Louisiana Public Facilities Authority solid waste disposal facility revenue bonds. Specifically, the company, which is the borrower under the bond loan, failed to make a $2.4 million principal payment, a $1.85 million interest payment and a $575,000 interest payment in favor of the authority, which issued the bonds.

In addition, the trustee said the authority failed to make a $4.25 million debt service payment due Jan. 1 on the series 2013C bonds, as well as a $575,000 interest payment due Jan. 1 on the series 2014B bonds.

According to a notice released last month, the failure to make the payments constitutes an event of default under the bond indenture and loan agreement, and the failure of Louisiana Pellets to make the loan payments triggers an additional event of default under the indenture.

The trustee also said the construction manager for the Louisiana Pellets project said that there are very few personnel at the project site and that the electricity was turned off at the project as of Dec. 22.

The borrower’s counsel confirmed that the project is not operational, the notice said.

The company is represented by C. Davin Boldissar.

Louisiana Pellets’ Chapter 11 case number is 16-80162, and German Pellets’ case number is 16-80163.

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