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  • Another Stimulus-Backed Energy Company Files for Bankruptcy

    After months of financial turmoil, an Energy Department-backed lithium ion battery company has filed for Chapter 11 bankruptcy protection.

    The company, Ener1, received a $118 million grant from DOE in 2010 as part of the president’s stimulus package. The money, which went to Ener1 subsidiary EnerDel, aimed to promote renewable energy storage battery technology for electrical grid use.

    But despite generous federal support for the company, Ener1 was racked by problems last year. In October, NASDAQ delisted the company due to non-compliance with Securities and Exchange Commission filing requirements. A month later, the company’s president, chief executive, and top financial officer were fired.

    On Thursday, Ener1 announced it will initiate a pre-packaged Chapter 11 bankruptcy plan as part of an agreement to restructure the company’s debt obligations.

    Ener1, Inc. (OTC: HEVV) (the “Company”) today announced that it has reached agreement with its primary investors and lenders on a restructuring plan that will significantly reduce its debt and provide up to $81 million to recapitalize the Company to support its long-term business objectives and strategic plan.

    To implement this restructuring plan, the Company has voluntarily initiated a “pre-packaged” Chapter 11 case in U.S. Bankruptcy Court in the Southern District of New York, in which it is requesting that the Court confirm a pre-packaged Plan of Reorganization to implement the restructuring.  The Company filed a proposed Disclosure Statement and Plan of Reorganization with the Court and anticipates completing the restructuring process in approximately 45 days…

    The pre-packaged restructuring plan, which has been unanimously accepted by all of Ener1′s impaired creditors, provides for a restructuring of the Company’s long-term debt and the infusion of up to $81 million of equity funding, which will support the continued operation of Ener1′s subsidiaries and help ensure that the restructuring will not adversely impact their employees, customers and suppliers.  Of this amount, a new debtor-in-possession (DIP) credit facility of up to $20 million will be available upon Court approval to support working capital needs during the restructuring.  The balance, for a total of up to $81 million, will be available over the four years following Court approval of the restructuring plan and subject to the satisfaction of certain terms and conditions.

    Ener1 is not the first energy storage technology company to file for Chapter 11 after receiving significant stimulus support. Beacon Power, which manufactures flywheel energy storage technology, received a $43 million loan guarantee from the same stimulus program that funded Solyndra. Despite having used $3 million marked for loan repayment to continue funding its daily operations, Beacon filed for Chapter 11 in November.

    UPDATE: Vice President Biden lauded Ener1 as a stimulus success one year ago – to the day. The stimulus was, Biden claimed, “not just creating new jobs, but sparking whole new industries that will ensure our competitiveness for decades to come — industries like electric vehicle manufacturing.” He went on to single out Ener1 specifically.

    Posted in Scribe [slideshow_deploy]

    26 Responses to Another Stimulus-Backed Energy Company Files for Bankruptcy

    1. Brent says:

      The new definition of insanity: Obama's energy policy

    2. John Timmerman says:

      Ener1 now makes the total of just about $1 Billion of POTUS's failed energy projects.

    3. GTS says:

      Vice President Biden, while visiting Ener1’s new plant in Indiana last January, a day after the State of the Union address last year, pronounced, “Once America has set a goal as a nation, we have never, never not achieved it!”

      And Ener1’s CEO announced, “This is about planting the roots of a critical industry firmly in American soil.”

      But here’s the shocking part. Ener1 is majority-owned and controlled by Russian interests.

      • PMD says:

        Where can I find that? The only thing I find is that they are publicly traded, headquartered in NYC and have mfging plants in US and Korea.

        • Jim Barclay says:

          Ener1's principal shareholder is a Russian businessman named Boris Zingarevich from the Ilim Timber Group (Russia)

    4. Ener1, Inc bankruptcy makes a total of almost $1billion in POTUS's failing Government Funded Green Energy Projects.

    5. steve h says:

      Is that what happens in venture capitalism? I've never heard of a venture capitalist that hits 100%. Hence the word 'venture'.

      • Joe R says:

        The venture capitalist also uses his, or his firm's, own capital, to fund these "investments". These companies petition for the cash and have to sell the company HARD. The venture capitalist uses cold, factually based analysis to determine what firms are worthy of his funding.

        In Politics, this doesn't exist. Obama wants green energy, therefore, a handful of green energy companies get cash. This cash doesn't come from Obama, he'll earn his money whether this "investment" fails or not. His neck isn't on the line, so he has little economic incentive to make selective picks. Only economic ones. Fortunately, the apologist brigade like you guys will use lines like this to "explain it away".

        • dakotaland says:

          I agree, and a venture capitalist does a better due diligence, since it is his or her money at risk.

      • This isn't venture capitalism it's crony capitalism. Besides venture capitalist use their own money that's why its called venture not stimulus.

    6. Raymond B says:

      Our president(pino) is too stupid to fix what's wrong with America. Bring back American jobs and you'll have a surplus of funds. Fund other countries businesses and what will you have. BANKRUPTCY!
      But hey he got Government Motors through one.

    7. flyfysr says:

      How much did the owners of this company contribute to Obama's campaign prior to going belly up?

    8. Randybuyland says:

      Are we realllly surprised by this announcement that ANOTHER of the so-called "green" companies has gone bust? WE THE PEOPLE will NOT forget this when we go to the polls in November! Time for some REAL hope and change!

    9. Jim Beachley says:

      Another great waste of taxpayer money/ All in the name of GREEN.

      • Joe R says:

        I think you mean GREED.

        You know, the kind Liberals insist they oppose. Except this time, greed doesn't result in working extra hard to please, but a handout to people who will waste it on things the public doesn't want.

    10. Rob Ryan says:

      Can't wait to see how much their execs "donated" to the Obama campaign… Crony capitalism/socialism at it's finest! 284 more days until Obama is fired!

    11. jackieaxe says:

      Kinda looks like a flux-capacitor!

    12. HiHeels says:

      this is so ironic, i was arguing politics with an arizona lady today and she says she will not get the new smart meter because she is solar and not polluting.

      I asked her about the solar battery collection and how much energy and pollution did it take to make them.

      I see the answer is not much.. he he he my pretty because they went belly up..

    13. steve h says:

      I love that Mitch Daniels gave the SOTU GOP response and he has been one of the biggest supporters of (aliong with many other Republicans) Ener1. See statement below – Daniels = most important individual to Ener1. How's that for irony?

      “No single individual has been more important to us than Governor Mitch Daniels, our advocate-in-chief in Washington and on missions abroad,” the executive said, introducing Daniels.

      “Indiana is committed to maintaining a climate where innovative businesses like Ener1 can succeed,” Governor Daniels said in his prepared remaks. “We’re very proud to have played a role in bringing these two companies together and look forward to their shared success as they develop the next phase of the electric car industry. Today’s announcement is an example of one of many fruitful partnerships between Indiana and China and shows that the Hoosier economy has a global reach.”

      • Pat says:

        So whats your point; that Mitch Daniels is doing his job as Governor and bringing business to his state. He understands capitalism he is a good conservative republican and is very pro business in all types of industries. There is a difference in generating and supporting business for jobs and supporting questionable technologies with tax payers dollars for political gain which is all the Obama administration is doing.

    14. Bobbie says:

      …another one bites the dust!
      and another one gone, another one gone, another one bites the dust!
      HEY! it'll get you too, another one bites the dust!

    15. Carlos says:

      Pinky and the Brain…will it never end…oh elections are coming…Whew

    16. Mike Hyland says:

      My grandfather always believed in throwning any Green Weenies into the trash… immediately

    17. Marine1972 says:

      Does anyone have or know of a site capturing the obummer failures?

    18. Buy Direct says:

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