PRC obtains court approval to hire CEO, other advisers ahead of disclosure statement filing April 1

By Rebecca Melvin

New York, March 27 - PRC LLC received bankruptcy court approval Thursday to hire Regis G. McElhatton as chief executive. In addition, other motions were approved, clearing the way for the services company to file its plan disclosure statement by April 1.

The company was authorized to hire McElhatton, who became the company's chief executive last summer while he was still working under a consultant services agreement.

Under the employment agreement that runs through Jan. 23, 2009, the company is authorized to pay McElhatton a bonus of up to $375,000.

PRC also gained approval of a post-petition severance program that covers 9,000 employees.

A motion to retain J.H. Cohn LLP as financial adviser and forensic accountant to the official committee of unsecured creditors was also approved, as was a motion to employ Blank Rome LLP as counsel to the official committee of unsecured creditors.

Finally, Jenner & Block LLP was retained to deal with conflict matters.

The disclosure statement will be filed on time, but financial projections are not expected to be ready and will be submitted in a subsequent filing by April 9, counsel for the company told the court.

Disclosure statement hearing May 8

The Plantation, Fla., provider of customer-relationship management services is moving ahead with a pre-packaged case at the U.S. Bankruptcy Court for the Southern District of New York, aiming for a disclosure statement approval hearing May 8 and a plan confirmation hearing June 18.

The company is "working hard' to meet upcoming deadlines, but there are potential objections ahead that could result in a contested hearing, counsel for the company told judge Martin Glenn.

PRC is "working hard on putting together the financial aspects that we're going to need to support the disclosure statement," attorney Alfredo Perez of Weil Gotshal & Manges said.

"In the coming month, now that we have severance in place, there will be significant movement with the company and getting closer to what it will look like when it comes out [of bankruptcy]," Perez said.

"Service businesses don't tend to do well in bankruptcy," Perez said, indicating a need for expediency in the case. "The company will be smaller in terms of revenue, but much healthier."

Glenn asked that the company inform his chambers as soon as possible if there is a need to schedule evidentiary hearings.

PRC filed for bankruptcy on Jan. 23. Its Chapter 11 case number is 08-10239.

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