DDi disclosure statement approved

By Peter Heap

New York, Oct. 3 - DDi Corp.'s disclosure statement for its Chapter 11 reorganization obtained the approval of the United States Bankruptcy Court for the Southern District of New York.

The confirmation hearing for the plan was set for Nov. 18.

Objections to the plan are due by Nov. 5 and ballots from creditors voting on the plan must be received by Nov. 8.

Under the company's debt restructuring, which was agreed with creditors committees ahead of the prepackaged Chapter 11 filing:

* The full amount of the senior secured credit facility, currently $72.9 million plus accrued interest and fees will be restructured in an out-of-court agreement. The restructured senior credit facility will mature on April 15, 2008, and amortization will be deferred until June 30, 2005. The lenders under the restructured senior secured credit facility will receive warrants for 10% of DDi's common stock.

* Holders of DDi Capital's senior discount notes, with $16.09 million outstanding, will receive restructured senior discount notes with a maturity date of Jan. 1, 2009. Payment-in-kind interest on the notes will accrue at 16%, with an option to transition to cash pay at 14%. The noteholders will also receive warrants representing 2.5% of DDi's common stock.

* Holders of DDi's 5¼% convertible subordinated notes, with $100 million outstanding, will receive 43% of the new common stock of DDi and shares of a new class of preferred stock of DDi Europe, DDi's European operating company, with an annual dividend of 15% and a liquidation preference of $7.5 million.

* Holders of DDi's 6¼% convertible subordinated notes, with $100 million outstanding, will receive 51% of the new common stock of DDi and shares of a new class of preferred stock of DDi Europe, DDi's European operating company, with an annual dividend of 15% and a liquidation preference of $7.5 million.

* DDi's common stock holders will receive 1% of the common stock in the restructured company. All outstanding stock options will be cancelled.

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