ITR Concession pre-packaged restructuring confirmed; cash use allowed

By Kali Hays

New York, Oct. 28 – ITR Concession Co. LLC won confirmation of its joint pre-packaged plan of reorganization and approval of a related disclosure statement, according to an Oct. 28 order from the U.S. Bankruptcy Court for the Northern District of Illinois.

A separate order also granted the company access to the cash collateral of its pre-bankruptcy lender to fund the reorganization process and continued business operations.

As previously reported, the company said it reached an agreement on the terms of a plan of reorganization after discussions with a committee of senior secured lenders and existing equity sponsors.

The approved plan calls for either a sale of substantially all company assets or a comprehensive balance sheet restructuring.

If pursued, the sale process will be conducted by a special committee and could run through Aug. 1, 2015.

Following completion of a sale, ITR will make distributions in accordance with the plan and be wound down and dissolved to the extent its equity interests are not acquired in connection with the sale.

If no sale is completed, the company will either enter into a $2.75 billion loan facility comprised of $2 billion in first-lien loans and $750 million in second-lien loans, which will be distributed to pre-bankruptcy senior secured creditors, or ITR will obtain new third-party financing, the cash proceeds of which will be distributed to the senior secured creditors.

Also under the restructuring option, the company’s pre-bankruptcy senior secured creditors will receive 95.75% of the equity interests in reorganized ITR. Reorganized Statewide Mobility Partners LLC will receive the remaining 4.25% of the equity interests, and the equity sponsors will retain their equity interests in reorganized Statewide.

Before the plan effective date, the equity sponsors may elect to receive some or all of $80 million in lieu of the distribution of reorganized holding company interests to reorganized Statewide.

The equity sponsors will have the right to operate and manage the Indiana Toll Road for an initial term of 10 years in exchange for either cash reimbursement for the cost of services provided or up to 3% of the equity interests in the reorganized holding company. Those equity interests will vest over 10 years after the effective date of the plan.

In the event of a change of control or sale of substantially all of the assets of the reorganized company during the 18-month period after the plan effective date, the equity sponsors and/or reorganized Statewide can cause the reorganized ITR to purchase their share of reorganized holding company interests for their share of $80 million, and the reorganized company can purchase the holding company interests held by Statewide for $100 million.

Under both the sale and restructuring plan options, general unsecured claims will be paid in full in cash.

ITR is a Chicago-based toll road operator that filed for bankruptcy on Sept. 21. The Chapter 11 case number is 14-34284.

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