Idearc files reorganization plan; lenders to obtain 95% of new stock

By Jennifer Lanning Drey

Portland, Ore., May 18 - Idearc Inc. filed its plan of reorganization and related disclosure statement Friday with the U.S. Bankruptcy Court for the Northern District of Texas.

Under the plan, 95% of the stock in the reorganized company will be distributed to holders of secured credit facility claims.

The remaining new common stock will be distributed to holders of unsecured note claims.

Reorganized Idearc will also receive $3 billion in new term loans.

Creditor treatment

Creditor treatment under the plan includes:

• Holders of administrative, priority, secured tax and other priority claims will be paid in full in cash;

• Holders of other secured claims will be paid in full by having their claims reinstated;

• Holders of secured credit facility claims will receive their share of cash on hand as of the effective date in excess of $150 million, $3 billion of new senior secured term loans and 95% of the new common stock in reorganized Idearc;

• Holders of general unsecured claims may elect to have their claims reclassified as convenience claims and receive a single cash payment. The recovery percentage has not yet been estimated;

• Holders of unsecured note claims and general unsecured claims not voluntarily classified as convenience claims will receive their share of 5% of the new common stock and any distributions made from a litigation trust;

• Holders of Idearc subordinated claims and interests will receive no distributions under the plan; and

• Existing Idearc common stock will be cancelled.

Idearc, a Dallas-based provider of yellow and white page directories and related advertising products, filed for bankruptcy on March 31 in the U.S. Bankruptcy Court for the Northern District of Texas. Its Chapter 11 case number is 09-31828.

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