Solus Alternative Asset Management Lp

Allegations: SOLUS ALTERNATIVE ASSET MANAGEMENT LP RECEIVED A SEC INQUIRY RELATING TO AN ALLEGED VIOLATION OF RULE 105 OF REGULATION M UNDER THE SECURITIES EXCHANGE ACT OF 1934 IN CONNECTION WITH SOLUS CLIENTS PARTICIPATING IN A FOLLOW-ON OFFERING. RULE 105 GENERALLY PROHIBITS PURCHASING AN EQUITY SECURITY IN A REGISTERED FOLLOW-ON OFFERING IF THE PURCHASER SOLD SHORT THE SAME SECURITY DURING A RESTRICTED PERIOD. RULE 105'S PROHIBITION APPLIES IRRESPECTIVE OF ANY INTENT TO VIOLATE THE RULE. THE ALLEGED VIOLATION OCCURRED IN SEPTEMBER 2013. Status: Final Sanction Detail: SOLUS ALTERNATIVE ASSET MANAGEMENT LP AGREED TO SETTLE A SEC INQUIRY RELATING TO AN ALLEGED VIOLATION OF RULE 105 OF REGULATION M WITHOUT ADMITTING OR DENYING THE SEC'S SUBSTANTIVE ALLEGATIONS. THE TOTAL SETTLEMENT AMOUNT OF $105,495.22 (A DISGORGEMENT PAYMENT OF $39,600, A CIVIL MONETARY PENALTY $65,000 AND INTEREST IN THE AMOUNT OF $895.22) WAS PAID TO THE SEC ON SEPTEMBER 17, 2014 IN ACCORDANCE WITH THE TERMS OF THE RELATED CEASE AND DESIST ORDER. Summary: IN SEPTEMBER 2014, SOLUS ALTERNATIVE ASSET MANAGEMENT LP ("SOLUS") SETTLED A SEC INQUIRY RELATING TO RULE 105 OF REGULATION M WITHOUT ADMITTING OR DENYING THE SEC'S SUBSTANTIVE ALLEGATIONS. RULE 105 GENERALLY PROHIBITS PURCHASING AN EQUITY SECURITY IN A REGISTERED FOLLOW-ON OFFERING IF THE PURCHASER SOLD SHORT THE SAME SECURITY DURING A RESTRICTED PERIOD (GENERALLY DEFINED AS FIVE BUSINESS DAYS BEFORE THE PRICING OF THE OFFERING). RULE 105'S PROHIBITION APPLIES IRRESPECTIVE OF ANY INTENT TO VIOLATE THE RULE. SOLUS NOTES THAT THERE HAVE BEEN NO ALLEGATIONS BY THE SEC THAT SOLUS INTENDED TO VIOLATE RULE 105. IN ADDITION, SOLUS' PARTICIPATION IN THE FOLLOW-ON OFFERING AND THE AMOUNT OF THE TRADES IN ISSUE WAS DE MINIMUS (I.E., $39,600 OF PROFITS) AND THE RELEVANT SHORT POSITION IN ISSUE WAS FULLY CLOSED ON THE DAY THE OVERNIGHT FOLLOW-ON OFFERING OCCURRED. UNDER THE TERMS OF THE SETTLEMENT, SOLUS AGREED TO CEASE AND DESIST FROM COMMITTING OR CAUSING ANY FUTURE VIOLATIONS OF RULE 105 OF REGULATION M. SOLUS ALSO AGREED TO PAY A CIVIL PENALTY OF $65,000, DISGORGEMENT OF $39,600, AND PREJUDGMENT INTEREST OF $895.22. SOLUS NOTES THAT IT PAID THE SETTLEMENT AMOUNT WITHOUT REIMBURSEMENT FROM ANY OF ITS CLIENTS. FURTHERMORE, SOLUS HAS ADOPTED ENHANCED COMPLIANCE POLICIES AND PROCEDURES DESIGNED TO PREVENT VIOLATIONS OF RULE 105.