Novation Companies’ Second Amended Joint Chapter 11 Plan of Reorganization became effective, and the Company emerged from Chapter 11 protection. The U.S. Bankruptcy Court confirmed the Plan on June 12, 2017.
BankruptcyData’s detailed Plan Summary notes, “The Plan is premised that on the Effective Date the disputes between the Debtors and the Noteholders will be fully settled, and the Noteholders will receive: a lump sum payment in an amount of approximately $5,800,000 so long as the Effective Date will occur on or before July 31, 2017; the Amended Senior Notes in principal amounts equal to the existing principal amounts under the Indentures, which will accrue non-default interest at LIBOR + 350 basis points, have a maturity date of March 20, 2033, and $500,000 in the aggregate on account of reimbursement of outstanding fees and expenses of the Noteholders’ respective counsel through the Effective Date, payable to the respective Noteholders counsel directly.”
In addition, “The Liquidation Analysis for Reorganized Novation Companies estimates the Net Liquidation Proceeds to be between $31.2 million and $39.7 million. The recovery rate to the Senior Notes is estimated to be between 34.1% and 43.3%.”
This diverse services provider filed for Chapter 11 protection on July 20, 2016, listing $32 million in pre-petition assets.
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