New York agency's trustee grants forbearance amid Bronx Parking restructuring talks

By Caroline Salls

Pittsburgh, Dec. 18 - The New York City Industrial Development Agency's series 2007 civic facility revenue bonds trustee U.S. Bank NA is in restructuring talks regarding Bronx Parking Development Co., LLC project bonds and entered a second default forbearance agreement, according to a notice to bondholders from the trustee.

Under the second forbearance, the trustee agreed not to act on specified installment sale agreement, indenture and continuing disclosure agreement defaults through Dec. 15, 2015.

U.S. Bank said the parties agreed to the forbearance to allow more time to seek potential operational and/or land use alternatives to maximize Bronx Parking's future revenue and to give the parties enough time to analyze the operational results arising from the 2014 fiscal year.

In addition, the trustee said the agreement was designed to prevent the company from needing to immediately file Chapter 11 bankruptcy and to allow partial payments under the indenture during the forbearance period.

Specifically, the trustee said the proceeds of any sale, lease, sublease or release of the company's leasehold interest in any of the Harlem River South Lot, the 153rd St. Garage, the Harlem River North Lot, the 153rd St. Lot or the River Avenue Lot received during the forbearance period will be transferred by the purchaser or lessee/sublessee to the bond fund, and the majority consenting bondholders will agree on application of those funds.

Under a proposed restructuring term sheet, tendered existing bonds would be exchanged for new series A bonds due 2046, new series B subordinate bonds due 2056 and new series C junior subordinate bonds due 2056.

The restructuring would be implemented through either an out-of-court exchange offer or, if a 98% minimum acceptance ratio is not obtained, through a Chapter 11 plan.

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