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Avaya Bankruptcy PSA Approved

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The U.S. Bankruptcy Court approved Avaya’s motion for entry of an order authorizing the Debtors to enter into and perform under a plan support agreement (PSA).

As previously reported, “In particular, the mediation resulted in the substantial resolution of issues among the parties, which are reflected in the Second Amended Joint Chapter 11 Plan of Reorganization. Among other things, the Second Amended Plan: (a) increases the recovery of Holders of Second Lien Notes Claims by providing each such Holder its Pro Rata share of (i) 4.0% of Reorganized HoldCo Common Stock, and (ii) warrants to acquire an additional 5.132% of the Reorganized HoldCo Common Stock; (b) reduces the equity distribution to Holders of First Lien Debt Claims from 91.5% to 90.5% of the Reorganized HoldCo Common Stock; (c) modifies PBGC’s proposed recovery to consist of $340 million in cash and 5.5% of the Reorganized HoldCo Common Stock; and (d) reduces the General Unsecured Recovery Cash Pool to $57,500,000, but also provides funding for the GUC Oversight Administrator Costs in an amount up to $500,000 for the first year following the Effective Date.”

In addition, “In form, the Crossover PSA mirrors the terms and conditions of that certain plan support agreement by and among the Debtors and members of the Ad Hoc First Lien Group dated August 6, 2017 (the ‘First Lien PSA’), which agreement was approved by the Court on August 25, 2017. In substance, the Court’s approval of the Crossover PSA will lock in support from members of the Ad Hoc Crossover Group who hold, in the aggregate, more than 65% of Second Lien Notes Claims, and approximately 20% of First Lien Debt Claims, which, together with the support already in place from the Ad Hoc First Lien Group, PBGC, and the Committee, will (again, subject to the Court’s approval) permit the Debtors to continue solicitation and proceed to confirmation on their Second Amended Plan on a consensual basis among every major creditor constituency in these chapter 11 cases.”

Read more Avaya bankruptcy news.

The post Avaya Bankruptcy PSA Approved appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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