Holley Performance files plan; secured noteholders to receive stock in new company

By Jennifer Lanning Drey

Portland, Ore., March 10 - Holley Performance Products Inc. filed its proposed plan of reorganization and related disclosure statement Wednesday with the U.S. Bankruptcy Court for the District of Delaware.

Creditor treatment under the plan includes:

• Holders of $20.3 million of secured credit agreement claims will be paid in full in cash;

• Holders of $50 million of secured note claims will receive their share of common stock in the reorganized company or the expected value of the shares in cash for a 61% recovery;

• Holders of other secured claims will have their claims fully reinstated;

• Holders of other priority claims will be paid in full in cash;

• Holders of $11 million of general unsecured claims, as well as holders of subordinated securities claims and holders of equity interests will receive no recovery; and

• Equity interests in Holley's subsidiaries will remain effective and outstanding.

Exit financing

Also under the plan, Holley plans to obtain a $17.8 million senior secured credit facility from Wells Fargo Capital Finance, Inc.

The facility will include a $10 million secured revolving line of credit and a $7.8 million three-year secured term loan.

Additionally, the plan includes an $11.2 million second-lien facility from Ore Hill Credit Hub Fund Ltd., consisting of a five-year secured term loan.

Holley, a Bowling Green, Ky.-based maker of high-performance carburetors and other automotive engine equipment, filed for bankruptcy on Sept. 28. Its Chapter 11 case number is 09-13333.

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