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SFX Entertainment Plan Filed

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SFX Entertainment filed with the U.S. Bankruptcy Court a Fifth Amended Joint Plan of Reorganization and related Disclosure Statement.

According to the Disclosure Statement, “The Plan proposes the issuance of three classes of securities: New Series A Preferred Stock, New Series B Preferred Stock and New Common Stock. The shares of New Series A Preferred Stock to be issued shall have a face amount and a liquidation value as of the Effective Date equal to 102% of the sum of (1) the amount, as of the Effective Date, of Incremental Tranche B DIP Accordion Claims, net of amounts paid or payable in Cash in accordance with the Plan, and (2) the New Series A Preferred Stock Investment Amount.”

The Disclosure Statement continues, “The issuance of the New Series A Preferred Stock shall be funded through (A) with respect to the amount described in clause (1) of the preceding sentence, the conversion of the Incremental Tranche B DIP Accordion Claims, net of amounts paid or payable in Cash in accordance with the Plan, into shares of New Series A Preferred Stock, and (B) with respect to the amount described in clause (2) of the preceding sentence, the sale of shares of the New Series A Preferred Stock pursuant to the New Series A Preferred Stock Investment Agreement. The New Series A Preferred Stock shall, among other things, (i) accrue PIK dividends at 15% per annum and shall be perpetual preferred subject to a mandatory redemption at the New Series A Preferred Stock Liquidation Preference, upon a Liquidity Event, (ii) have voting rights entitling it to vote on a 20:1 ratio to the voting rights of the New Common Stock, (iii) be senior in right of payment to the New Series B Preferred Stock and (iv) have such other terms and conditions as set forth in the applicable New Governance Documents or the New Series A Preferred Stock Certificate….The Plan also proposes the issuance of three series of warrants: the Series A Warrants, the Series B Warrants, and the Series C Warrants.”

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