Cygnus Business Media emerges from bankruptcy; French named CEO

By Caroline Salls

Pittsburgh, Sept. 21 - Cygnus Business Media, Inc. emerged from Chapter 11 bankruptcy when its pre-packaged plan of reorganization took effect on Monday, according to a company news release.

As previously reported, Cygnus Business Media filed its pre-packaged plan on Aug. 3 after being unable to reach agreement with one of its 24 lenders on a financial restructuring plan.

The plan, which was confirmed on Sept. 8 by the U.S. Bankruptcy Court for the District of Delaware, restructures the company's secured debt by converting a portion to equity.

All general unsecured creditors, including all vendors, will be paid in full in the ordinary course of business.

Plan treatment

Plan creditor treatment will include:

• Holders of administrative claims and priority tax claims will recover 100% in cash;

• Holders of other priority claims and general unsecured claims will either be paid in full in cash or their rights to the claim will remain unaltered;

• Holders of other secured claims will either be paid in full in cash, their claims will remain unaltered or they will receive the collateral securing the claim;

• Holders of first-lien facility claims will recover up to 70% through a new $60 million term note due June 30, 2013 and new common stock in the reorganized company. Interest on the term note will be Libor plus 650 basis points, with a 3.25% Libor floor;

• Holders of second-lien facility claims will recover up to 4% in warrants to purchase 7,600 shares of new class A common stock at an exercise price of $450 per share;

• Intercompany claims will be discharged; and

• Series A, B, C and D preferred stock interests and other equity interests will be cancelled, with holders receiving no distribution.

The company said earlier this month that it planned to obtain $5 million in exit financing due June 30, 2013 to fund plan distributions.

Interest will be Libor plus 750 bps, with a 3.25% Libor floor.

New CEO

According to the release, John French has been named as the reorganized company's new chief executive officer.

"Cygnus Business Media is a formidable influence in business today," French said in the release.

"We have strong footprints in the areas of public safety, security, aviation, transportation and construction, all industries that provide the backbone of America's renewal."

French was most recently the CEO of Penton Media, Inc. and a member of its board of directors.

Cygnus Business Media, a Fort Atkinson, Wis., publisher of business-to-business media products, filed for bankruptcy on Aug. 3. Its Chapter 11 case number is 09-12765.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.