MTE Holdings eyes court approval of corporate governance settlement

By Caroline Salls

Pittsburgh, Feb. 6 – MTE Holdings LLC requested court approval to enter a settlement and amend the operating agreements of some of its debtors to allow for the constitution of a board of managers, according to a motion filed Wednesday with the U.S. Bankruptcy Court for the District of Delaware.

MTE said in the motion that its Chapter 11 cases “have been mired in litigation since they were filed.” The company said this included a dispute over whether Riverstone Credit Management, LLC validly installed directors immediately before the bankruptcy filing date.

After it defeated a motion related to that dispute, the company said three creditor groups filed trustee appointment motions based on allegations of pre-bankruptcy mismanagement and other alleged misconduct.

“Although the debtors vigorously contested the allegations in these motions and believed they would ultimately defeat them, the debtors were concerned that litigation with these creditor groups would continue in other contexts thereafter, threatening even more substantial cost and delay, which could jeopardize the debtors’ efforts to reorganize,” the motion said.

MTE said the proposed settlement provides a governance framework for a consensual resolution of its Chapter 11 cases.

Specifically, the settlement calls for the creation of a board of managers on which chief executive officer Mark Siffin and independent managers Matthew Doheny and Neal Goldman will serve.

Richard Betz will be appointed as a board observer and “lend to the board his significant industry expertise.”

In addition to the continuation of Siffin as CEO, the settlement calls for the appointment of Scott Pinsonnault as a new chief restructuring officer and Ankura Consulting Group, LLC as the MTE debtors’ financing adviser.

A hearing is scheduled for Feb. 24.

MTE is a Midland, Tex.-based holding company. The company filed bankruptcy Oct. 22 under Chapter 11 case number 19-12269.

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