QualTek hearing on confirmation of pre-packaged plan set for June 30

By Sarah Lizee

Olympia, Wash., May 25 – QualTek Services Inc.’s combined hearing on confirmation of its pre-packaged Chapter 11 plan of reorganization and final approval of the related disclosure statement is scheduled for June 30, according to an order filed Wednesday with the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, the plan aims to reduce the debtors’ prepetition debt by roughly $307 million, deleverage their balance sheet, and provide additional liquidity.

The debtors are gathering commitments from their creditors for a restructuring support agreement that memorializes support for the plan.

QualTek said it expects that the debtors’ only asset-based lender, lenders of about 85% of their term loan debt, about 80% of their convertible noteholders, and the debtors’ largest equity holder will document their support for the restructuring.

The company had asked to fast-track the process and proposed a voting deadline of 5 p.m. ET on June 23 and a combined hearing on June 30.

QualTek hopes to emerge from bankruptcy within 65 days.

Creditor treatment

Under the plan, holders of administrative claims and other priority claims will receive payment in full in cash.

Holders of allowed priority term loan claims will have their priority term loan claim converted on a dollar-for-dollar basis into a first-lien exit facility loan.

Holders of allowed rollover term loan claim will receive their pro rata share of the third-lien exit facility loans.

Holders of allowed tranche B term loan claims will receive their pro rata share of 40% of new equity interests, subject to dilution by warrants and a management incentive plan (MIP).

Holders of allowed convertible notes claims will receive their pro rata share of 10% of new equity interests, subject to dilution by the warrants and the MIP, and their pro rata share of warrants.

General unsecured claims will be reinstated or otherwise receive payment in full in cash.

QualTek is a Blue Bell, Pa.-based provider of turnkey services to the North American telecommunications, infrastructure and power industries. The company filed bankruptcy on May 24 under Chapter 11 case number 23-90584.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.