AI
Thursday, June 11, 2009 8:30:36 PM
June 12, Fridays Play and into next week. News and an 8k from today on bottom.
AbitibiBowater Wins Final OK on Receivables Financing Deal
By Peg Brickley of DOW JONES DAILY BANKRUPTCY REVIEW
June 11, 2009
WILMINGTON, Del. (DOW JONES) -- Abitibibowater Inc. (ABWTQ) Thursday won court approval of a $270 million accounts receivable securitization arrangement after agreeing to pay continued interest and professional fees to secured term lenders.
Judge Kevin Carey signed off on the accounts receivable arrangement at a hearing in U.S. Bankruptcy Court in Wilmington, Del.
The deal from a syndicate led by Citigroup Inc. (C) allows AbitibiBowater to speed and smooth its cash flow as it continues operation under the protection of courts in Canada and the U.S.
It's the third piece of the financing that the world's largest producer of newsprint needs to keep its plants running. Carey last week granted final approval to a #206 million Chapter 11 loan, while Canadian courts approved a $100 million loan.
The new accounts receivable arrangement replaces an existing deal from Citigroup that has allowed AbitibiBowater to stay on its feet financially after its May 18 bankruptcy filing. The existing deal terminates Monday.
Term lenders who are owed $347 million had objected to the deal, demanding "adequate protection" payments, including continuing interest on their loans.
Under U.S. law, adequate protection payments are warranted when troubled companies use property that is considered collateral for their secured loans. In this case, lenders say the accounts and the cash are considered collateral.
Term lenders threatened to block the replacement arrangement for accounts receivable unless the company agreed to keep paying them interest.
Company attorney Kelley Cornish said AbitibiBowater agreed to make "modified" adequate protection payments in order to make sure the deal won approval. That includes footing the bill for professionals to look out for the term lenders in the cross-border insolvency proceeding.
AbitibiBowater, based in Montreal, south protection from creditors in an effort to deal with two lines of debt that are the heritage of the 2007 combination that created the company. One series of loans is linked to the Bowater companies; the other is linked to the Abitibi group.
(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection.)
8k filed today a/h.
Form 8-K for ABITIBIBOWATER INC.
--------------------------------------------------------------------------------
11-Jun-2009
Entry into a Material Definitive Agreement, Financial Statements and Exhibits
Item 1.01. Entry into a Material Definitive Agreement.
Effective June 5, 2009, AbitibiBowater Inc. ("AbitibiBowater"), Bowater Incorporated ("Bowater"), a subsidiary of AbitibiBowater, Bowater Newsprint South LLC ("BNS"), a subsidiary of AbitibiBowater, Bowater Canadian Forest Products Inc. ("Bowater Canada"), an indirect subsidiary of Bowater, the subsidiaries of Bowater, BNS and Bowater Canada and certain lenders party thereto entered into an amendment (the "Amendment") to the Senior Secured Superpriority Debtor In Possession Credit Agreement dated as of April 21, 2009 (the "Credit Agreement").
The Amendment modifies the Credit Agreement to, among other things,
(i) correct certain documentation errors, including, but not limited to, (a) correcting the minimum base rate from 2.50% per annum to 4.50% per annum, (b) modifying the calculation of the fixed charge coverage ratio required to be maintained by Bowater and the guarantors under the Credit Agreement and (c) clarifying certain provisions related to interest calculations and payment dates (including waiving certain defaults which occurred as a result of confusion over the prior language); (ii) amend the definition of consolidated EBITDA to, among other things, permit Chapter 11 and Companies' Creditors Arrangement Act (Canada) expenses, including professional fees, to be added to net income for purposes of calculating consolidated EBITDA; (iii) permit additional debt owed by Calhoun Newsprint Company to one or more Bowater entities so long as the aggregate amount of such additional debt, together with any additional investments in Calhoun Newsprint Company, does not exceed $10,000,000; (iv) extend the time available to appoint a Chief Restructuring Officer from June 5, 2009 to June 20, 2009; and (v) extend the time available from June 5, 2009 to June 30, 2009 to (a) obtain private debt ratings from Moody's and Standard & Poor's on the loans under the term loan facility provided pursuant to the Credit Agreement and any other incremental facility and (b) provide the mortgages and other related documentation with respect to certain properties.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the Amendment, which is filed as Exhibit 10.1 hereto, and is incorporated herein by reference.
--------------------------------------------------------------------------------
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
10.1 Amendment No. 1, dated as of June 5, 2009, to the Senior Secured Superpriority Debtor In Possession Credit Agreement, dated as of April 21, 2009 by and among AbitibiBowater Inc., Bowater Incorporated, Bowater Canadian Forest Products Inc. and each of the lenders party thereto
AND.............................................................
AbitibiBowater Wins Final OK on Receivables Financing Deal
By Peg Brickley of DOW JONES DAILY BANKRUPTCY REVIEW
June 11, 2009
WILMINGTON, Del. (DOW JONES) -- Abitibibowater Inc. (ABWTQ) Thursday won court approval of a $270 million accounts receivable securitization arrangement after agreeing to pay continued interest and professional fees to secured term lenders.
Judge Kevin Carey signed off on the accounts receivable arrangement at a hearing in U.S. Bankruptcy Court in Wilmington, Del.
The deal from a syndicate led by Citigroup Inc. (C) allows AbitibiBowater to speed and smooth its cash flow as it continues operation under the protection of courts in Canada and the U.S.
It's the third piece of the financing that the world's largest producer of newsprint needs to keep its plants running. Carey last week granted final approval to a #206 million Chapter 11 loan, while Canadian courts approved a $100 million loan.
The new accounts receivable arrangement replaces an existing deal from Citigroup that has allowed AbitibiBowater to stay on its feet financially after its May 18 bankruptcy filing. The existing deal terminates Monday.
Term lenders who are owed $347 million had objected to the deal, demanding "adequate protection" payments, including continuing interest on their loans.
Under U.S. law, adequate protection payments are warranted when troubled companies use property that is considered collateral for their secured loans. In this case, lenders say the accounts and the cash are considered collateral.
Term lenders threatened to block the replacement arrangement for accounts receivable unless the company agreed to keep paying them interest.
Company attorney Kelley Cornish said AbitibiBowater agreed to make "modified" adequate protection payments in order to make sure the deal won approval. That includes footing the bill for professionals to look out for the term lenders in the cross-border insolvency proceeding.
AbitibiBowater, based in Montreal, south protection from creditors in an effort to deal with two lines of debt that are the heritage of the 2007 combination that created the company. One series of loans is linked to the Bowater companies; the other is linked to the Abitibi group.
(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection.)
AbitibiBowater Wins Final OK on Receivables Financing Deal
By Peg Brickley of DOW JONES DAILY BANKRUPTCY REVIEW
June 11, 2009
WILMINGTON, Del. (DOW JONES) -- Abitibibowater Inc. (ABWTQ) Thursday won court approval of a $270 million accounts receivable securitization arrangement after agreeing to pay continued interest and professional fees to secured term lenders.
Judge Kevin Carey signed off on the accounts receivable arrangement at a hearing in U.S. Bankruptcy Court in Wilmington, Del.
The deal from a syndicate led by Citigroup Inc. (C) allows AbitibiBowater to speed and smooth its cash flow as it continues operation under the protection of courts in Canada and the U.S.
It's the third piece of the financing that the world's largest producer of newsprint needs to keep its plants running. Carey last week granted final approval to a #206 million Chapter 11 loan, while Canadian courts approved a $100 million loan.
The new accounts receivable arrangement replaces an existing deal from Citigroup that has allowed AbitibiBowater to stay on its feet financially after its May 18 bankruptcy filing. The existing deal terminates Monday.
Term lenders who are owed $347 million had objected to the deal, demanding "adequate protection" payments, including continuing interest on their loans.
Under U.S. law, adequate protection payments are warranted when troubled companies use property that is considered collateral for their secured loans. In this case, lenders say the accounts and the cash are considered collateral.
Term lenders threatened to block the replacement arrangement for accounts receivable unless the company agreed to keep paying them interest.
Company attorney Kelley Cornish said AbitibiBowater agreed to make "modified" adequate protection payments in order to make sure the deal won approval. That includes footing the bill for professionals to look out for the term lenders in the cross-border insolvency proceeding.
AbitibiBowater, based in Montreal, south protection from creditors in an effort to deal with two lines of debt that are the heritage of the 2007 combination that created the company. One series of loans is linked to the Bowater companies; the other is linked to the Abitibi group.
(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection.)
8k filed today a/h.
Form 8-K for ABITIBIBOWATER INC.
--------------------------------------------------------------------------------
11-Jun-2009
Entry into a Material Definitive Agreement, Financial Statements and Exhibits
Item 1.01. Entry into a Material Definitive Agreement.
Effective June 5, 2009, AbitibiBowater Inc. ("AbitibiBowater"), Bowater Incorporated ("Bowater"), a subsidiary of AbitibiBowater, Bowater Newsprint South LLC ("BNS"), a subsidiary of AbitibiBowater, Bowater Canadian Forest Products Inc. ("Bowater Canada"), an indirect subsidiary of Bowater, the subsidiaries of Bowater, BNS and Bowater Canada and certain lenders party thereto entered into an amendment (the "Amendment") to the Senior Secured Superpriority Debtor In Possession Credit Agreement dated as of April 21, 2009 (the "Credit Agreement").
The Amendment modifies the Credit Agreement to, among other things,
(i) correct certain documentation errors, including, but not limited to, (a) correcting the minimum base rate from 2.50% per annum to 4.50% per annum, (b) modifying the calculation of the fixed charge coverage ratio required to be maintained by Bowater and the guarantors under the Credit Agreement and (c) clarifying certain provisions related to interest calculations and payment dates (including waiving certain defaults which occurred as a result of confusion over the prior language); (ii) amend the definition of consolidated EBITDA to, among other things, permit Chapter 11 and Companies' Creditors Arrangement Act (Canada) expenses, including professional fees, to be added to net income for purposes of calculating consolidated EBITDA; (iii) permit additional debt owed by Calhoun Newsprint Company to one or more Bowater entities so long as the aggregate amount of such additional debt, together with any additional investments in Calhoun Newsprint Company, does not exceed $10,000,000; (iv) extend the time available to appoint a Chief Restructuring Officer from June 5, 2009 to June 20, 2009; and (v) extend the time available from June 5, 2009 to June 30, 2009 to (a) obtain private debt ratings from Moody's and Standard & Poor's on the loans under the term loan facility provided pursuant to the Credit Agreement and any other incremental facility and (b) provide the mortgages and other related documentation with respect to certain properties.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the Amendment, which is filed as Exhibit 10.1 hereto, and is incorporated herein by reference.
--------------------------------------------------------------------------------
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
10.1 Amendment No. 1, dated as of June 5, 2009, to the Senior Secured Superpriority Debtor In Possession Credit Agreement, dated as of April 21, 2009 by and among AbitibiBowater Inc., Bowater Incorporated, Bowater Canadian Forest Products Inc. and each of the lenders party thereto
AND.............................................................
AbitibiBowater Wins Final OK on Receivables Financing Deal
By Peg Brickley of DOW JONES DAILY BANKRUPTCY REVIEW
June 11, 2009
WILMINGTON, Del. (DOW JONES) -- Abitibibowater Inc. (ABWTQ) Thursday won court approval of a $270 million accounts receivable securitization arrangement after agreeing to pay continued interest and professional fees to secured term lenders.
Judge Kevin Carey signed off on the accounts receivable arrangement at a hearing in U.S. Bankruptcy Court in Wilmington, Del.
The deal from a syndicate led by Citigroup Inc. (C) allows AbitibiBowater to speed and smooth its cash flow as it continues operation under the protection of courts in Canada and the U.S.
It's the third piece of the financing that the world's largest producer of newsprint needs to keep its plants running. Carey last week granted final approval to a #206 million Chapter 11 loan, while Canadian courts approved a $100 million loan.
The new accounts receivable arrangement replaces an existing deal from Citigroup that has allowed AbitibiBowater to stay on its feet financially after its May 18 bankruptcy filing. The existing deal terminates Monday.
Term lenders who are owed $347 million had objected to the deal, demanding "adequate protection" payments, including continuing interest on their loans.
Under U.S. law, adequate protection payments are warranted when troubled companies use property that is considered collateral for their secured loans. In this case, lenders say the accounts and the cash are considered collateral.
Term lenders threatened to block the replacement arrangement for accounts receivable unless the company agreed to keep paying them interest.
Company attorney Kelley Cornish said AbitibiBowater agreed to make "modified" adequate protection payments in order to make sure the deal won approval. That includes footing the bill for professionals to look out for the term lenders in the cross-border insolvency proceeding.
AbitibiBowater, based in Montreal, south protection from creditors in an effort to deal with two lines of debt that are the heritage of the 2007 combination that created the company. One series of loans is linked to the Bowater companies; the other is linked to the Abitibi group.
(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection.)
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