Charys disclosure statement approved; plan confirmation hearing Feb. 25

By Jennifer Lanning Drey

Portland, Ore., Jan. 8 - Charys Holding Co. obtained court approval of the disclosure statement for its plan of reorganization, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

The plan confirmation hearing is scheduled for Feb. 25.

As previously reported, the plan calls for establishment of a new holding company, with holders of Charys' 8.75% senior convertible note claims scheduled to receive 94% of the new equity in the holding company.

The new holding company will transfer the funds necessary to make plan creditor payments to a liquidating trust.

Creditor treatment

Treatment of creditors will include:

• Holders of administrative expense claims, professional compensation and reimbursement claims, priority tax claims, other priority claims and secured tax claims will recover 100% in cash;

• Holders of secured working capital facility claims and other secured debt claims will recover 100% either in cash, the return of the collateral securing the claim or the proceeds from the sale of the collateral;

• Holders of $5.4 million in Cotton Seller note claims will be treated in accordance with a Cotton Seller settlement agreement;

• Holders of CTSI/MSAI Seller note claims and $8 million in mirror note claims will be treated in accordance with a CTSI/MSAI settlement;

• Holders of $210 million in Charys Holdings 8¾% senior convertible note claims will receive a share of $20 million in new 15% four-year secured notes, a share of 94% of the new equity interests in the reorganized company and a class B beneficial interest in the Charys liquidating trust;

• Holders of $44.2 million in general unsecured claims will receive a class B beneficial interest in the liquidating trust; and

• Holders of Charys Holdings subordinated debt, securities and equity interests and C&B debtor 8.75% senior convertible notes, subordinated debt claims, securities claims and equity interests will receive no distribution under the plan.

Charys is an Atlanta-based infrastructure services company that filed for bankruptcy on Feb. 14, 2008. Its Chapter 11 case number is 08-10289.

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