Local Insight, Caribe Media reorganization plans confirmed by court

By Caroline Salls

Pittsburgh, Nov. 3 - Local Insight Media Holdings, Inc. and Caribe Media, Inc. won confirmation of their plans of reorganization at a joint hearing held Nov. 3 in the U.S. Bankruptcy Court for the District of Delaware.

Under Local Insight's plan, the company will emerge with a new credit facility, and total debt will be reduced by more than 90%.

Treatment of Local Insight's creditors will include the following:

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

• Other secured claims will either be reinstated or holders will be paid in full in cash or receive the collateral securing the claims;

• Holders of debtor-in-possession facility claims will be paid in full through an exit financing facility;

• Holders of Regatta credit facility claims will receive reorganized Regatta common stock and a share of Regatta notes distribution property;

• Holders of Regatta subordinated notes claims, Regatta Investor general unsecured claims, Super Holdco general unsecured claims, LIM Finance II senior subordinated note claims, LIM Finance term loan claims, LIM Finance general unsecured claims, Regatta Investor and Regatta Holdings Interests, Super Holdco interests, LIM Finance interests and section 510(b) claims will receive no distribution;

• Holders of Regatta general unsecured claims will receive cash equal to 13% of their claims;

• Holders of LIM Finance II term loan claims will receive equity securities in Local Insight Media LP and LIM, GP LLC and a share of LIM Finance II note distribution property;

• Holders of LIM Finance II general unsecured claims will receive equity securities in Local Insight Media LP and LIM, GP LLC; and

• Berry Cos. interests will be reinstated.

Exit commitment

As previously reported, Local Insight has received court approval to enter into a commitment letter for $35 million of exit financing from GSO Capital Partners LP.

The financing will fund plan of reorganization payments, including payments for debtor-in-possession facility and administrative, secured and general unsecured claims, as well as fund the reorganized company's post-emergence working capital needs.

According to the motion, holders of all Regatta senior credit facility claims will be allowed to participate in the exit facility. GSO has agreed to backstop the entire facility if not enough Regatta lenders participate.

Interest on the three-year exit loan will be either Libor plus 700 basis points with a 300 bps floor or the alternate base rate plus 600 bps with a 400 bps floor, at the company's option.

Caribe Media plan

Meanwhile, under Caribe Media's plan,

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

• Holders of senior secured credit facility claims will receive a share of the exit facility and 100% of the new common stock; and

• Holders of senior subordinated note claims, Caribe interests and section 510(b) claims will receive nothing.

Caribe Media, an Englewood, Colo.-based publisher of directories in Puerto Rico and the Dominican Republic, filed for bankruptcy on May 3, 2011. The Chapter 11 case number is 11-11387.

Caribe Media's parent, CII Acquisition Holding Inc., is a wholly owned subsidiary of Local Insight Media Holdings LP debtor Local Insight Media Holdings III Inc.

CII Acquisition is a debtor in Caribe Media's Chapter 11 case.

Local Insight, an Englewood, Colo., publisher of print and online directories, filed for bankruptcy on Nov. 17, 2010. Its Chapter 11 case number is 10-13677.

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