The Plan of Reorganization has the support of more than 70% of the Senior Secured Noteholders (the First Lien Holders), the holders of certain funds and accounts under management that collectively own or control a percentage of the company’s senior secured first-in, last-out notes, who also hold a percentage of the first lien notes, second lien notes, and senior unsecured notes, as well as the support of the Unsecured Creditors Committee (UCC) whose members consist of trade creditors, the Pension Benefit Guaranty Corporation, certain unions, and the indenture trustee for the unsecured noteholders.
A hearing before the United States Bankruptcy Court for the Southern District of New York is scheduled for June 7, 2018 for the Company to seek approval of its first amended disclosure statement and to establish the voting procedures for the Plan of Reorganization.
The terms of the Plan of Reorganization will enable the company to exit Chapter 11 with a highly deleveraged balance sheet, which will allow the company to focus on its operations and grow its businesses. Prior to filing for Chapter 11, the company’s liabilities included approximately $1.1 billion in funded debt. Upon emergence, the company’s funded debt will be reduced to under $400 million.
As part of the revised agreement with the First Lien Holders, the amount of funded debt issued upon exit will be reduced from $200 million to $100 million.
“Today’s announcement is a very important milestone in our efforts to delever our balance sheet,” said Robert G. Burton Sr., Cenveo’s chairman and CEO. “These agreements provide Cenveo a clear path towards confirmation of our Plan of Reorganization and exiting Chapter 11 bankruptcy in the summer of 2018 as we had initially indicated.”
In addition, Cenveo announced that upon emergence from Chapter 11, Robert G. Burton Sr. will retire from the company and will be succeeded by his son Robert G. Burton, Jr., who will become CEO. Michael G. Burton, Cenveo’s current COO, will become president upon emergence. Robert G. Burton Sr. will serve as an advisor to Cenveo until Dec. 31, 2018 and will remain a Cenveo shareholder.