MacKeyser negotiates global settlement deal with lenders and committee

By Kali Hays

New York, Sept. 19 – MacKeyser Holdings, LLC has reached a settlement agreement with its official committee of unsecured creditors and lenders, Health Evolution Partners Fund I, LP and Health Evolution Partners Co-Invest, LLC, according to a Friday motion with the U.S. Bankruptcy Court for the District of Delaware.

The company said that the settlement “will pave the way for an orderly and value-maximizing case exit” while resolving committee objections to its debtor-in-possession financing, cash collateral use and the liens asserted by Health Evolution in exchange for subordinating a portion of its loans and consenting to continued cash collateral access.

“The settlement will also enable the estates to move towards the consummation of a Chapter 11 plan of liquidation that provides for the possibility of a recovery for general unsecured creditors,” the motion stated.

Specifically, Health Evolution has agreed to forbear from exercising its rights under the final DIP order requiring the facility be repaid in full from the proceeds of asset sales, to voluntarily extend the maturity date of the facility, and to subordinate a portion of the loan obligations to administrative and priority creditors.

Proceeds from asset sales will be held in escrow to be used for the payment of permitted senior liens.

In addition, Health Evolution will subordinate its pre-petition secured claim of $2.25 million.

With those compromises, MacKeyser agreed to waive non-insider preference and the committee agreed not to pursue any of its objections and support the releases included in the final DIP order, according to the motion.

MacKeyser also agreed to pay fees and expenses of Health Evolution up to $100,000 and repay a portion of the DIP loan in the amount of $523,614 after entry of a court order approving the settlement.

Upon the effective date of a confirmed liquidation plan, the settlement agreement calls for the creation of a litigation trust which will be assigned all rights, causes of action, remaining cash and assets of the estate.

The proceeds held by the trust will be used first to pay allowed administrative claims and then to pay all remaining DIP obligations.

A hearing to approve the settlement is set for Oct. 16.

Las Vegas-based MacKeyser Holdings and operating affiliates American Optical Services, LLC and Exela Hearing Services, LLC manage integrated eye care and hearing systems providers. The company filed for bankruptcy on June 20 under Chapter 11 case number 14-11550.

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