Interep files plan of reorganization based on bondholder restructuring agreement

By Caroline Salls

Pittsburgh, April 24 - Interep National Radio Sales, Inc. filed its plan of reorganization and related disclosure statement Wednesday in the U.S. Bankruptcy Court for the Southern District of New York.

As previously reported, the company entered into a pre-packaged restructuring agreement with its largest bondholders, Oaktree Capital Management, LP and Silver Point Capital, LP, which will allow the company to eliminate all of its existing cash-pay debt.

Also, the company and the supporting noteholders are discussing the terms of an up to $50 million exit facility that would be used to repay amounts outstanding under the DIP financing and provide the reorganized company with additional capital for its future growth.

Treatment of creditors under the pre-packaged plan will include:

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

• Holders of secured claims will receive either cash equal to the claim amount or the return of the collateral securing the claim, or the claims will be reinstated;

• Holders of $99 million in principal and $2.48 million in interest of 10% senior subordinated notes due July 2008 will receive their share of class 3 distributable securities, which includes $40 million in new 10-year second-lien secured debt securities and new common stock in the reorganized company;

• Holders of general unsecured claims will recover 100% through their share of class 4 cash, plus quarterly distribution of any additional distribution amount;

• Intercompany claims will be reinstated;

• Holders of Section 510(b) claims and old equity interests will receive no distribution under the plan; and

• Holders of subsidiary interests will have their interests reinstated.

A hearing on approval of the disclosure statement is scheduled for May 28.

Interep, a New York-based radio advertising and marketing company, filed for bankruptcy on March 30. Its Chapter 11 case number is 08-11079.

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