Tronox Inc. (TROX)

[Madclown]

WSJ - Tronox Lenders Extend Deadline On $425M Bankruptcy Loan
By Eric Morath Of DOW JONES DAILY BANKRUPTCY REVIEW

Tronox Inc. (TRXAQ, TRXBQ) struck a deal with its lenders to extend a $425 million bankruptcy loan that will allow the chemical company to avoid facing a possible liquidation after acknowledging that it will miss a key June 24 loan deadline.

The extension, subject to court approval, would allow Tronox to continue to access the funding and give it until Sept. 24 to send a bankruptcy-exit plan to creditors for a vote, the company said in papers filed Tuesday with the U.S. Bankruptcy Court in Manhattan.

Tronox has said it will miss a June 24 deadline to obtain court approval of an outline of its Chapter 11 plan, which is required before the company can send its plan to creditors for a vote.

Without the amended loan, Tronox "would be unable to comply with the restructuring milestones" and could be forced to pay off the loan on an accelerated basis or "commence a process to sell its assets," the company said in court papers.

Tronox agreed to pay an unspecified amount of fees to its lenders, led by Goldman Sachs Group Inc. (GS), in exchange for the extended maturity date. In addition to an "arrangement fee," Tronox will pay a fee equal to 0.5% of the outstanding amount of the loan to each lender that consents to the amended loan terms.

A hearing on the matter is scheduled for June 24.

The loan was a key component to Tronox's decision late last year to abandon plans to sell itself and instead pursue a standalone reorganization. The loan, which repaid Tronox's pre-bankruptcy secured debt, will convert to exit financing after the company emerges from Chapter 11.

In addition to the financing, the company struck a deal for bondholders to backstop a $105 million equity-rights offering and reached an agreement with the U.S. government to settle claims for environmental liabilities.

Despite those deals, the Oklahoma City company said progress on a Chapter 11 plan that reaches a consensual agreement among all parties is moving slower than it expected.

The company said it has also so far failed to reach a binding deal with other government entities, including state and tribal jurisdictions, over environmental claims. The deadline to reach that agreement was June 30.

Tronox, which filed for bankruptcy protection in January 2009, produces titanium dioxide, a whitening pigment used in everything from paint to toothpaste.

The company was created in March 2006 when it was spun off from Kerr-McGee Corp., which was later acquired by Anadarko Petroleum Corp. (APC). Tronox took on a host of environmental liabilities in the deal, and blamed those costs for its bankruptcy filing.

(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection.)

-By Eric Morath; Dow Jones Daily Bankruptcy Review; 202-862-9279; [e-mail]

http://online.wsj.com/article/BT-CO-20100616-711160.html?mod=WSJ_latestheadlines