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SunEdison cash-management plan would give creditors financial oversight


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SunEdison cash-management plan would give creditors financial oversight

asked a U.S.bankruptcy judge to allow it to continue using an existing cash-managementsystem while giving creditors oversight of the company's finances.

Theproposed order, filed July 6 in U.S. Bankruptcy Court for the Southern Districtof New York, would require the renewable energy developer to submit spendingreports every two weeks to unsecured creditors and other parties in the Chapter11 case detailing expected transactions with non-debtor affiliates, includingthe names of funding recipients, the terms and business rationale for payments,and the timing and method of repayment.

Theproposal represents a compromisewith unsecured creditors who objected to SunEdison being given unfetteredaccess to the cash-management system it used before bankruptcy to distributefunds through its vast network of companies. In their objections, creditorscited past allegations of financial wrongdoing at SunEdison and the company's "opaquecapital structure."

"Inconnection with the ongoing utilization of their Cash Management System, theDebtors shall continue to maintain accurate and detailed records with respectto all transfers of cash … so that all transactions are adequately documentedand readily ascertainable," according to the proposed order.

SunEdison'sdownfall started in mid-2015 after excitement about the company's aggressivegrowth strategy gave way to concerns about its heavy debt load and creativefinancial practices. The company has yet to file its annual report for 2015, inpart because of material weaknesses in its financial compliance procedures.Executives are also accused of diverting funds from an affiliate to repay a marginloan and to improve SunEdison's liquidity position.