Ahern Rentals ballots tabulated for competing debtor, noteholder plans

By Jim Witters

Wilmington, Del., May 21 - The ballots for Ahern Rentals, Inc.'s competing Chapter 11 plans have been tabulated by Evan Gershbein, senior vice president of corporate restructuring services with Kurtzman Carson Consultants LLC, according to a May 20 filing with the U.S. Bankruptcy Court for the District of Nevada.

The plans under consideration were the debtor's second amended plan of reorganization and the second amended plan of reorganization proposed by certain holders of the 9¼% senior secured second-lien notes due 2013.

Debtor's plan vote

Under the plan proposed by the debtors, the tabulation showed:

• Holders of second-lien loan claims: eight in number (14.29%) and $277,036 in (0.13%) amount voted to accept; 48 in number (85.71%) and $218.02 million in amount (99.87%) voted to reject;

• A holder of Kubota claims: one in number (100%) and $266,125 in amount (100%) voted to accept; zero voted to reject;

• Holders of class 6D personal injury claims: one in number (50%) and $3 million in amount (92.31%) voted to accept; one in number (50%) and $250,000 in amount (7.69%) voted to reject;

• A holder of class 6E personal injury claims: one in number (100%) and $28,583 in amount (100%) voted to accept;

• A holder of class 6K personal injury claims: one in number (100%) and $500,000 in amount (100%) voted to reject;

• A holder of class 6L personal injury claims: one in number (100%) and $10,000 in amount (100%) voted to accept;

• Holders of general unsecured claims: 292 in number (96.05%) and $3.06 million in amount (93.18%) voted to accept; 12 in number (3.95%) and $224,348 in amount (6.82%) voted to reject; and

• Holders of convenience claims: 111 in number (100%) and $136,121 in amount (100%) voted to accept.

Noteholders' plan vote

• Holders of second-lien notes claims: 56 in number (94.92%) and $220.44 million in amount (99.88%) voted to accept; three in number (5.08%) and $257,000 in amount (0.12%) voted to reject;

• Holders of personal injury claims: five in number (71.43%) and $3.09 million in amount (80.45%) voted to accept; two in number (28.57%) and $750,000 in amount (19.55%) voted to reject; and

• A holder of equity interests: one in number (100%) and 30 shares in amount (100%) voted to reject.

Bankruptcy code

Under the bankruptcy code, an entire class of claims is deemed to accept a plan if the plan is accepted by creditors that hold at least two-thirds in amount and more than one-half in number of the allowed claims in the class.

If there are impaired classes of claims, the court cannot confirm a plan unless it has been accepted by at least one class of non-insiders who hold impaired claims.

Holders of unimpaired claims are deemed to have accepted the plan.

A hearing on confirmation of a Chapter 11 plan is scheduled for June 3.

Debtor plan treatment

Treatment of creditors under Ahern's amended plan would include:

• Administrative claims, priority tax claims and other priority claims will be paid in full;

• Holders of term loan claims will receive the full amount of the term loan;

• Holders of second-lien loan secured claims will receive a share of $160 million in cash and junior secured A notes if the class votes to accept the plan and a share of junior secured B notes if the class does not accept the plan;

• Holders of other secured claims will either have their claims reinstated or be paid in full in cash, receive the proceeds from the sale of the collateral securing the claims or receive the collateral;

• Holders of personal injury claims will be paid in full for the first $250,000 of each insured personal injury claim, less defense costs. Claims not paid in full will receive a share of policy proceeds of liability insurance policies remaining as of the bankruptcy filing date;

• Holders of general unsecured claims will be paid in full in cash in installments over one year with 5% interest;

• Holders of Kubota claims will receive cash equal to 5% of the claim on the plan effective date, cash equal to 5% of the claim 90 days after the effective date and the balance 180 days after the effective date;

• Holders of convenience claims will receive cash equal to 85% of their claims; and

• Holders of equity interests will retain their interests.

Noteholder plan treatment

Creditor treatment under the noteholder plan would include:

• Holders of other secured claims will either have their claims reinstated, be paid in full in cash, receive the proceeds from the sale of the collateral securing the claims or receive the collateral;

• Holders of priority claims, first-lien term loan claims, personal injury claims and general unsecured claims will be paid in full in cash;

• Holders of second-lien notes claims will receive a share of the new equity interests in the reorganized company;

• Holders of insider claims will receive semiannual payments over two years with interest at a rate to be determined by the court upon the later of the resolution of lawsuits related to insider causes of action, resolution of avoidance actions against an insider who holds an insider claim and another date set by the court; and

• Holders of equity interests that vote to accept the plan will receive a share of new warrants. Those who vote to reject the plan will receive no distribution.

Ahern Rentals, a Las Vegas-based equipment rental company, filed for bankruptcy on Dec. 22, 2011 under Chapter 11 case number 11-53860.

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