Restoration Forest Products’ pre-packaged Chapter 11 plan confirmed

By Sarah Lizee

Olympia, Wash., March 27 – Restoration Forest Products Group, LLC received confirmation of its pre-packaged Chapter 11 plan from the U.S. Bankruptcy Court for the District of Delaware on Wednesday, according to an order.

Prior to filing bankruptcy, the company said it faced multiple challenges in completing construction of its facility in Bellemont, Ariz., which led to an overall delay of 16 months and cost increases of about $30 million.

The company received $95 million in debtor-in-possession financing from funds managed by Invesco Senior Secured Management, Inc. The financing consists of $29 million in new money multi-draw term loans, with the remaining amount being a rollup of prepetition bridge debt.

Upon completion of the Chapter 11 process, Invesco will become the new majority owner of the company in partnership with the existing equity sponsor, Lateral Investment Management.

Restoration Forest Products’ current capital structure includes about $64.34 million in bridge loans with Invesco, $128.87 million in series A bonds with Invesco, $107.37 million in series B bonds with Lateral and others and a $56.7 million loan agreement with Lateral.

The company intends to complete a restructuring plan that will strengthen its balance sheet and substantially reduce debt.

According to a disclosure statement, the plan will result in the following:

• Conversion of about $35 million of DIP claims to an exit facility with the balance of DIP claims to receive their ratable share of new class A units, subject to dilution on account of the management incentive plan;

• Discharge of the bridge loan claims with the holders of such claims to receive their ratable share of the new class A units, subject to dilution;

• Discharge of the senior series A bond claims with the holders of such claims to receive their ratable share of new class A units, subject to dilution;

• Discharge of the subordinated series B bond claims with the holders of such claims to receive their ratable share of new class B units, subject to dilution;

• Discharge of about $307 million of prepetition claims in total; and

• Cancellation of equity interests.

Construction of the facility in Bellemont, Ariz., is expected to be fully completed in the second quarter of 2024, with significant growth in production volume expected over this same timeframe, the company said.

The Bellemont, Ariz.-based sustainable forest products company filed Chapter 11 bankruptcy on Jan. 29 under case number 24-10120.

© 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.