CONDENSED CONSOLIDATING FINANCIAL INFORMATION | 9 Months Ended |
Sep. 30, 2014 |
Condensed Consolidating Financial Information [Abstract] | ' |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION | ' |
CONDENSED CONSOLIDATING FINANCIAL INFORMATION |
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Presented below are Verso Holdings’ consolidating balance sheets, statements of operations and comprehensive income, and statements of cash flows, as required by Rule 3-10 of Regulation S-X of the Securities Exchange Act of 1934, as amended. The consolidating financial statements have been prepared from Verso Holdings’ financial information on the same basis of accounting as the consolidated financial statements. Investments in our subsidiaries are accounted for under the equity method. Accordingly, the entries necessary to consolidate Verso Holdings’ subsidiaries that guaranteed the obligations under the debt securities described below are reflected in the Eliminations column. |
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Verso Holdings, or the “Parent Issuer,” and its direct, 100% owned subsidiary, Verso Paper Inc., or the “Subsidiary Issuer,” are the issuers of the 11.75% Senior Secured Notes due 2019, the 11.75% Secured Notes due 2019, the 8.75% Second Priority Senior Secured Notes due 2019, the Second Priority Adjustable Senior Secured Notes, the 11.38% Senior Subordinated Notes due 2016, and the Adjustable Senior Subordinated Notes, or collectively, the “Notes.” In accordance with ASU 2013-04 related to joint and several liability arrangements, the Notes have been recorded by the Parent Issuer as it is the intent of the issuers for the Parent Issuer to settle the obligation. The Notes are jointly and severally guaranteed on a full and unconditional basis by the Parent Issuer’s direct and indirect, 100% owned subsidiaries, excluding the Subsidiary Issuer, Bucksport Leasing LLC, Verso Quinnesec REP LLC, Verso Bucksport Power LLC, and Verso Androscoggin Power LLC, or collectively, the “Guarantor Subsidiaries.” Chase NMTC Verso Investment Fund, LLC, a consolidated VIE of Verso Holdings, is a “Non-Guarantor Affiliate.” |
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Verso Paper Holdings LLC |
Condensed Consolidating Balance Sheet |
September 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | |
| Parent | Subsidiary | Guarantor | Non- | Non- | | |
Guarantor | Guarantor |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiaries | Affiliate | Eliminations | Consolidated |
ASSETS | | | | | | | |
Cash and cash equivalents | $ | — | | $ | — | | $ | 11,829 | | $ | 5 | | $ | 10 | | $ | — | | $ | 11,844 | |
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Accounts receivable, net | — | | — | | 96,317 | | — | | — | | — | | 96,317 | |
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Inventories | — | | — | | 129,075 | | — | | — | | — | | 129,075 | |
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Prepaid expenses and other assets | — | | — | | 16,688 | | 1,674 | | 4 | | — | | 18,366 | |
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Current assets | — | | — | | 253,909 | | 1,679 | | 14 | | — | | 255,602 | |
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Property, plant, and equipment, net | — | | — | | 664,633 | | 23,380 | | — | | (289 | ) | 687,724 | |
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Intercompany/affiliate receivable | 1,375,370 | | — | | 2,343 | | 36,124 | | 31,153 | | (1,444,990 | ) | — | |
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Intangibles and other assets, net(1) | — | | — | | 97,638 | | 2,088 | | 85 | | — | | 99,811 | |
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Total assets | $ | 1,375,370 | | $ | — | | $ | 1,018,523 | | $ | 63,271 | | $ | 31,252 | | $ | (1,445,279 | ) | $ | 1,043,137 | |
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LIABILITIES AND MEMBER'S EQUITY | | | | | | | | | | | | |
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Accounts payable | $ | — | | $ | — | | $ | 88,259 | | $ | — | | $ | 15 | | $ | — | | $ | 88,274 | |
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Accrued liabilities | 44,590 | | — | | 72,902 | | 306 | | 126 | | — | | 117,924 | |
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Current maturities of long-term debt | — | | — | | — | | 40,000 | | — | | — | | 40,000 | |
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Current liabilities | 44,590 | | — | | 161,161 | | 40,306 | | 141 | | — | | 246,198 | |
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Intercompany/affiliate payable | — | | — | | 1,411,494 | | 33,496 | | — | | (1,444,990 | ) | — | |
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Investment in subsidiaries | 601,955 | | — | | 13,043 | | — | | — | | (614,998 | ) | — | |
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Long-term debt(2) | 1,306,977 | | — | | — | | — | | 23,305 | | — | | 1,330,282 | |
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Other liabilities | — | | — | | 36,886 | | — | | 8,128 | | (205 | ) | 44,809 | |
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Member's (deficit) equity | (578,152 | ) | — | | (604,061 | ) | (10,531 | ) | (322 | ) | 614,914 | | (578,152 | ) |
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Total liabilities and equity | $ | 1,375,370 | | $ | — | | $ | 1,018,523 | | $ | 63,271 | | $ | 31,252 | | $ | (1,445,279 | ) | $ | 1,043,137 | |
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-1 | Intangibles and other assets, net of Guarantor Subsidiaries include $23.3 million of a long-term note receivable from Verso Finance. | | | | | | | | | | | | | | | | | | | | |
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-2 | Long-term debt of Non-Guarantor Affiliate is payable to Verso Finance. | | | | | | | | | | | | | | | | | | | | |
Verso Paper Holdings LLC |
Condensed Consolidating Balance Sheet |
December 31, 2013 |
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| | | | | | | | | | | | | | | | | | | | | |
| Parent | Subsidiary | Guarantor | Non- | Non- | | |
Guarantor | Guarantor |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiaries | Affiliate | Eliminations | Consolidated |
ASSETS | | | | | | | |
Cash and cash equivalents | $ | — | | $ | — | | $ | 11,230 | | $ | — | | $ | 10 | | $ | — | | $ | 11,240 | |
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Accounts receivable, net | — | | — | | 104,624 | | — | | — | | — | | 104,624 | |
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Inventories | — | | — | | 137,687 | | — | | — | | — | | 137,687 | |
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Assets held for sale | — | | — | | 50 | | — | | — | | — | | 50 | |
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Prepaid expenses and other assets | — | | — | | 20,616 | | — | | 5 | | — | | 20,621 | |
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Current assets | — | | — | | 274,207 | | — | | 15 | | — | | 274,222 | |
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Property, plant, and equipment, net | — | | — | | 724,063 | | 19,171 | | — | | (288 | ) | 742,946 | |
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Intercompany/affiliate receivable | 1,335,323 | | — | | 1,393 | | — | | 31,153 | | (1,367,869 | ) | — | |
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Intangibles and other assets, net(1) | — | | — | | 103,424 | | 1,251 | | 85 | | — | | 104,760 | |
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Total assets | $ | 1,335,323 | | $ | — | | $ | 1,103,087 | | $ | 20,422 | | $ | 31,253 | | $ | (1,368,157 | ) | $ | 1,121,928 | |
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LIABILITIES AND MEMBER'S EQUITY | | | | | | | | | | | | |
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Accounts payable | $ | — | | $ | — | | $ | 88,397 | | $ | — | | $ | 15 | | $ | — | | $ | 88,412 | |
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Accrued liabilities | 58,847 | | — | | 63,462 | | — | | 126 | | — | | 122,435 | |
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Current maturities of long-term debt | 13,310 | | — | | — | | — | | — | | — | | 13,310 | |
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Current liabilities | 72,157 | | — | | 151,859 | | — | | 141 | | — | | 224,157 | |
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Intercompany/affiliate payable | — | | — | | 1,335,323 | | 32,546 | | — | | (1,367,869 | ) | — | |
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Investment in subsidiaries(3) | 439,125 | | — | | 12,124 | | — | | — | | (451,249 | ) | — | |
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Long-term debt(2) | 1,235,167 | | — | | — | | — | | 23,305 | | — | | 1,258,472 | |
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Other liabilities | — | | — | | 42,502 | | — | | 8,087 | | (164 | ) | 50,425 | |
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Member's (deficit) equity | (411,126 | ) | — | | (438,721 | ) | (12,124 | ) | (280 | ) | 451,125 | | (411,126 | ) |
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Total liabilities and equity | $ | 1,335,323 | | $ | — | | $ | 1,103,087 | | $ | 20,422 | | $ | 31,253 | | $ | (1,368,157 | ) | $ | 1,121,928 | |
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| | | | | | | | | | | | | | | | | | | | | |
-1 | Intangibles and other assets, net of Guarantor Subsidiaries include $23.3 million of a long-term note receivable from Verso Finance. | | | | | | | | | | | | | | | | | | | | |
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-2 | Long-term debt of Non-Guarantor Affiliate is payable to Verso Finance. | | | | | | | | | | | | | | | | | | | | |
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-3 | Investment in subsidiaries has been corrected to reflect presentation as a liability in conformity with current year presentation. | | | | | | | | | | | | | | | | | | | | |
Verso Paper Holdings LLC |
Condensed Consolidating Statements of Operations and Comprehensive Income |
Three Months Ended September 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | |
| Parent | Subsidiary | Guarantor | Non- | Non- | | |
Guarantor | Guarantor |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiaries | Affiliate | Eliminations | Consolidated |
Net sales | $ | — | | $ | — | | $ | 350,227 | | $ | 957 | | $ | — | | $ | (957 | ) | $ | 350,227 | |
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Cost of products sold (exclusive of depreciation, amortization, and depletion) | — | | — | | 295,364 | | 396 | | — | | (957 | ) | 294,803 | |
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Depreciation, amortization, and depletion | — | | — | | 22,717 | | 386 | | 14 | | (14 | ) | 23,103 | |
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Selling, general, and administrative expenses | — | | — | | 18,130 | | (364 | ) | 8 | | — | | 17,774 | |
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Interest income | (35,450 | ) | — | | (380 | ) | — | | (387 | ) | 35,837 | | (380 | ) |
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Interest expense | 35,450 | | — | | 35,067 | | 2,025 | | 379 | | (35,837 | ) | 37,084 | |
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Other loss, net | — | | — | | 14,006 | | — | | — | | — | | 14,006 | |
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Equity in net loss of subsidiaries | (36,163 | ) | — | | — | | — | | — | | 36,163 | | — | |
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Net loss | $ | (36,163 | ) | $ | — | | $ | (34,677 | ) | $ | (1,486 | ) | $ | (14 | ) | $ | 36,177 | | $ | (36,163 | ) |
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Other comprehensive income | 211 | | — | | 211 | | — | | — | | (211 | ) | 211 | |
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Comprehensive loss | $ | (35,952 | ) | $ | — | | $ | (34,466 | ) | $ | (1,486 | ) | $ | (14 | ) | $ | 35,966 | | $ | (35,952 | ) |
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Verso Paper Holdings LLC |
Condensed Consolidating Statements of Operations and Comprehensive Income |
Nine Months Ended September 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | |
| Parent | Subsidiary | Guarantor | Non- | Non- | | |
Guarantor | Guarantor |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiaries | Affiliate | Eliminations | Consolidated |
Net sales | $ | — | | $ | — | | $ | 970,256 | | $ | 1,706 | | $ | — | | $ | (1,706 | ) | $ | 970,256 | |
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Cost of products sold (exclusive of depreciation, amortization, and depletion) | — | | — | | 873,823 | | 683 | | — | | (1,706 | ) | 872,800 | |
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Depreciation, amortization, and depletion | — | | — | | 73,237 | | 1,007 | | 41 | | (41 | ) | 74,244 | |
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Selling, general, and administrative expenses | — | | — | | 54,211 | | (1,058 | ) | 24 | | — | | 53,177 | |
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Interest income | (105,804 | ) | — | | (1,138 | ) | — | | (1,160 | ) | 106,964 | | (1,138 | ) |
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Interest expense | 105,804 | | — | | 104,214 | | 3,804 | | 1,136 | | (106,964 | ) | 107,994 | |
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Other loss, net | — | | — | | 32,773 | | — | | — | | — | | 32,773 | |
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Equity in net loss of subsidiaries | (169,594 | ) | — | | — | | — | | — | | 169,594 | | — | |
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Net loss | $ | (169,594 | ) | $ | — | | $ | (166,864 | ) | $ | (2,730 | ) | $ | (41 | ) | $ | 169,635 | | $ | (169,594 | ) |
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Other comprehensive income | 635 | | — | | 635 | | — | | — | | (635 | ) | 635 | |
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Comprehensive loss | $ | (168,959 | ) | $ | — | | $ | (166,229 | ) | $ | (2,730 | ) | $ | (41 | ) | $ | 169,000 | | $ | (168,959 | ) |
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Verso Paper Holdings LLC |
Condensed Consolidating Statements of Operations and Comprehensive Income |
Three Months Ended September 30, 2013 |
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| | | | | | | | | | | | | | | | | | | | | |
| Parent | Subsidiary | Guarantor | Non- | Non- | | |
Guarantor | Guarantor |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiary | Affiliate | Eliminations | Consolidated |
Net sales | $ | — | | $ | — | | $ | 374,876 | | $ | — | | $ | — | | $ | — | | $ | 374,876 | |
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Cost of products sold (exclusive of depreciation, amortization, and depletion) | — | | — | | 305,718 | | — | | — | | — | | 305,718 | |
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Depreciation, amortization, and depletion | — | | — | | 26,064 | | 269 | | 13 | | (13 | ) | 26,333 | |
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Selling, general, and administrative expenses | — | | — | | 18,453 | | (433 | ) | 8 | | — | | 18,028 | |
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Restructuring charges | — | | — | | 145 | | — | | — | | — | | 145 | |
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Interest income | (34,843 | ) | — | | (384 | ) | — | | (387 | ) | 35,230 | | (384 | ) |
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Interest expense | 34,843 | | — | | 34,335 | | 394 | | 379 | | (35,230 | ) | 34,721 | |
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Other loss, net | 70 | | — | | — | | — | | — | | — | | 70 | |
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Equity in net loss of subsidiaries | (9,685 | ) | — | | — | | — | | — | | 9,685 | | — | |
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Net loss | $ | (9,755 | ) | $ | — | | $ | (9,455 | ) | $ | (230 | ) | $ | (13 | ) | $ | 9,698 | | $ | (9,755 | ) |
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Other comprehensive income | 634 | | — | | 634 | | — | | — | | (634 | ) | 634 | |
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Comprehensive loss | $ | (9,121 | ) | $ | — | | $ | (8,821 | ) | $ | (230 | ) | $ | (13 | ) | $ | 9,064 | | $ | (9,121 | ) |
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Verso Paper Holdings LLC |
Condensed Consolidating Statements of Operations and Comprehensive Income |
Nine Months Ended September 30, 2013 |
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| | | | | | | | | | | | | | | | | | | | | |
| Parent | Subsidiary | Guarantor | Non- | Non- | | |
Guarantor | Guarantor |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiary | Affiliate | Eliminations | Consolidated |
Net sales | $ | — | | $ | — | | $ | 1,038,481 | | $ | — | | $ | — | | $ | — | | $ | 1,038,481 | |
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Cost of products sold (exclusive of depreciation, amortization, and depletion) | — | | — | | 891,465 | | — | | — | | — | | 891,465 | |
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Depreciation, amortization, and depletion | — | | — | | 77,814 | | 806 | | 41 | | (41 | ) | 78,620 | |
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Selling, general, and administrative expenses | — | | — | | 57,254 | | (1,274 | ) | 24 | | — | | 56,004 | |
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Restructuring charges | — | | — | | 1,327 | | — | | — | | — | | 1,327 | |
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Other operating income | — | | — | | (3,971 | ) | — | | — | | — | | (3,971 | ) |
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Interest income | (103,628 | ) | — | | (1,156 | ) | — | | (1,160 | ) | 104,788 | | (1,156 | ) |
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Interest expense | 103,628 | | — | | 102,822 | | 1,181 | | 1,136 | | (104,788 | ) | 103,979 | |
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Other loss, net | 2,776 | | — | | — | | — | | — | | — | | 2,776 | |
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Equity in net loss of subsidiaries | (87,787 | ) | — | | — | | — | | — | | 87,787 | | — | |
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Net loss | $ | (90,563 | ) | $ | — | | $ | (87,074 | ) | $ | (713 | ) | $ | (41 | ) | $ | 87,828 | | $ | (90,563 | ) |
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Other comprehensive income | 2,020 | | — | | 2,020 | | — | | — | | (2,020 | ) | 2,020 | |
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Comprehensive loss | $ | (88,543 | ) | $ | — | | $ | (85,054 | ) | $ | (713 | ) | $ | (41 | ) | $ | 85,808 | | $ | (88,543 | ) |
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Verso Paper Holdings LLC |
Condensed Consolidating Statements of Cash Flows |
Nine Months Ended September 30, 2014 |
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| | | | | | | | | | | | | | | | | | | | | |
| | | | Non- | Non- | | |
| Parent | Subsidiary | Guarantor | Guarantor | Guarantor | | |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiary | Affiliate | Eliminations | Consolidated |
Net cash used in operating activities | $ | — | | $ | — | | $ | (70,184 | ) | $ | 863 | | $ | — | | $ | — | | $ | (69,321 | ) |
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Cash flows from investing activities: | | | | | | | | | | | | | | |
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Proceeds from sale of assets | — | | — | | 351 | | — | | — | | — | | 351 | |
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Transfers from (to) restricted cash | — | | — | | 2,020 | | (1,408 | ) | — | | — | | 612 | |
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Capital expenditures | — | | — | | (33,717 | ) | — | | — | | — | | (33,717 | ) |
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Other investing activities | — | | — | | 5,020 | | — | | — | | — | | 5,020 | |
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Advances to subsidiaries | (277,956 | ) | — | | — | | — | | — | | 277,956 | | — | |
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Payments from subsidiaries | 217,863 | | — | | — | | — | | — | | (217,863 | ) | — | |
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Net cash used in investing activities | (60,093 | ) | — | | (26,326 | ) | (1,408 | ) | — | | 60,093 | | (27,734 | ) |
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Cash flows from financing activities: | | | | | | | | | | | | | | |
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Borrowings on revolving credit facilities | 240,250 | | — | | — | | 100,199 | | — | | — | | 340,449 | |
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Payments on revolving credit facilities | (167,500 | ) | — | | — | | (60,199 | ) | — | | — | | (227,699 | ) |
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Debt issuance costs | — | | — | | — | | (2,434 | ) | — | | — | | (2,434 | ) |
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Repayments of long-term debt | (13,310 | ) | — | | — | | — | | — | | — | | (13,310 | ) |
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Contribution from Verso Paper | 690 | | — | | — | | — | | — | | — | | 690 | |
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Cash distributions | (37 | ) | — | | — | | — | | — | | — | | (37 | ) |
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Return of capital to Parent Issuer | — | | — | | — | | (892 | ) | — | | 892 | | — | |
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Advances from parent | — | | — | | 277,956 | | — | | — | | (277,956 | ) | — | |
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Payments to parent | — | | — | | (180,847 | ) | (36,124 | ) | — | | 216,971 | | — | |
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Net cash provided by financing activities | 60,093 | | — | | 97,109 | | 550 | | — | | (60,093 | ) | 97,659 | |
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Change in cash and cash equivalents | — | | — | | 599 | | 5 | | — | | — | | 604 | |
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Cash and cash equivalents at beginning of period | — | | — | | 11,230 | | — | | 10 | | — | | 11,240 | |
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Cash and cash equivalents at end of period | $ | — | | $ | — | | $ | 11,829 | | $ | 5 | | $ | 10 | | $ | — | | $ | 11,844 | |
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Verso Paper Holdings LLC |
Condensed Consolidating Statements of Cash Flows |
Nine Months Ended September 30, 2013 |
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| | | | | | | | | | | | | | | | | | | | | |
| | | | Non- | Non- | | |
| Parent | Subsidiary | Guarantor | Guarantor | Guarantor | | |
(Dollars in thousands) | Issuer | Issuer | Subsidiaries | Subsidiary | Affiliate | Eliminations | Consolidated |
Net cash used in operating activities | $ | — | | $ | — | | $ | (66,473 | ) | $ | 78 | | $ | (7 | ) | $ | — | | $ | (66,402 | ) |
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Cash flows from investing activities: | | | | | | | | | | | | | | |
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Proceeds from sale of assets | — | | — | | 28,357 | | — | | — | | — | | 28,357 | |
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Transfers to restricted cash | — | | — | | (941 | ) | (78 | ) | — | | — | | (1,019 | ) |
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Capital expenditures | — | | — | | (26,703 | ) | — | | — | | — | | (26,703 | ) |
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Return of capital to Parent Issuer | 8,653 | | — | | — | | — | | — | | (8,653 | ) | — | |
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Advances to subsidiaries | (127,500 | ) | — | | — | | — | | — | | 127,500 | | — | |
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Payments from subsidiaries | 105,353 | | — | | — | | — | | — | | (105,353 | ) | — | |
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Net cash provided by investing activities | (13,494 | ) | — | | 713 | | (78 | ) | — | | 13,494 | | 635 | |
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Cash flows from financing activities: | | | | | | | | | | | | | | |
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Borrowings on revolving credit facilities | 127,500 | | — | | — | | — | | — | | — | | 127,500 | |
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Payments on revolving credit facilities | (105,000 | ) | — | | — | | — | | — | | — | | (105,000 | ) |
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Debt issuance costs | (220 | ) | — | | — | | — | | — | | — | | (220 | ) |
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Return of capital to Verso Paper | (8,653 | ) | — | | — | | — | | — | | — | | (8,653 | ) |
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Cash distributions | (133 | ) | — | | — | | — | | — | | — | | (133 | ) |
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Return of capital to Parent Issuer | — | | — | | (8,653 | ) | — | | — | | 8,653 | | — | |
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Advances from parent | — | | — | | 127,500 | | — | | — | | (127,500 | ) | — | |
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Payments to parent | — | | — | | (105,353 | ) | — | | — | | 105,353 | | — | |
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Net cash (used in) provided by financing activities | 13,494 | | — | | 13,494 | | — | | — | | (13,494 | ) | 13,494 | |
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Change in cash and cash equivalents | — | | — | | (52,266 | ) | — | | (7 | ) | — | | (52,273 | ) |
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Cash and cash equivalents at beginning of period | — | | — | | 61,453 | | — | | 17 | | — | | 61,470 | |
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Cash and cash equivalents at end of period | $ | — | | $ | — | | $ | 9,187 | | $ | — | | $ | 10 | | $ | — | | $ | 9,197 | |
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Advances to and payments from subsidiaries amounts have been corrected to be presented in investing activities in conformity with current year presentation. |