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Plan Broadly Approved by Lenders and Noteholders
Debt to be Reduced by Approximately $200 Million
Operations to Continue Uninterrupted and Trade Creditors to be Paid in Full
White Plains, NY, January 11, 2010 — Haights Cross Communications, Inc. (“HCC”, and together with its U.S. subsidiaries, the “Company”)announced today that in response to the broad support received for its previously announced prepackaged plan of reorganization (the “Plan”) from holders of the obligations under that certain Credit Agreement, dated as of August 15, 2008, as amended, by and among Haights Cross Operating Company (“HCOC”), as borrower, the guarantors party thereto, including HCC, and the administrative agent thereto on behalf of the lenders party thereto from time to time (the “Credit Agreement”), holders of HCOC’s 11 ¾% Senior Notes due 2011 (the “Senior Notes”) and holders of HCC’s 12 ½% Senior Discount Notes due 2011 (“Senior Discount Notes”), the Company has elected to commence voluntary proceedings under Chapter 11 of the U.S. Bankruptcy Code to seek confirmation of the Plan. As previously announced, of those voting, 100% in dollar amount and 100% in number of holders of the obligations under the Credit Agreement, 100% in dollar amount and 100% in number of holders of the Senior Notes and approximately 90% in dollar amount and 90% in number of holders of the Senior Discount Notes voted to approve the Plan.
“Today's action is the next step in the process to significantly reduce our debt and create a new capital structure that will better enable us to invest in our business and build on our industry leadership," said Paul J. Crecca, HCC’s President and Chief Executive Officer. “Over the last several months, we have worked closely with our stakeholders to develop and now implement our plan to position Haights to meet the challenges of our industry. We plan to continue operations as normal through the Chapter 11 process, which we expect to conclude within 60 days.”
As previously disclosed, on September 3, 2009 the Company entered into a plan support agreement with all of the lenders under the Credit Agreement and holders of approximately 80% in principal amount of the Senior Notes on the terms of a consensual financial restructuring that would reduce the Company’s debt obligations by approximately $200 million (to approximately $180 million in the aggregate) and extend the maturity of the Company’s debt until no earlier than three years from the effective date of the Plan. The Plan otherwise leaves unimpaired the Company’s general unsecured claims, including those of trade creditors, which would be paid in full.
The Company filed its voluntary chapter 11 petitions and Plan in the U.S. Bankruptcy Court for the District of Delaware in Wilmington.
A form of the Plan and the related Disclosure Statement, which provide a substantial description of the restructuring, may be accessed through http://www.haightscross.com/.
Important Note
The transaction described above is subject to numerous closing conditions and there can be no assurances that the treatment of creditors outlined above will not change significantly. In the event that the Company is not able to successfully complete the restructuring contemplated by the Plan, it intends to explore all other restructuring alternatives available to it at that time. The Company cannot make assurances that any alternative restructuring arrangement or plan could be accomplished.
The above summary of the Plan is qualified in its entirety by the full text of the Plan and related Disclosure Statement referenced above.
About Haights Cross Communications:
Founded in 1997 and based in White Plains, NY, Haights Cross Communications is a premier educational and library publisher dedicated to creating the finest books, audio products, periodicals, software and online services, serving the following markets: K-12 supplemental education, public and school libraries, and consumers. Haights Cross companies include:
Triumph Learning, BuckleDown Publishing and Options Publishing, and Recorded Books. For more information, visit www.haightscross.com. Triumph Learning is HCC’s test-preparation and intervention business and is comprised of its Coach, Buckle Down, and Options brands. Recorded Books is a leading publisher of unabridged audiobooks and other audio media for libraries, schools, and consumers, with operations in the U.S., U.K. and Australia.
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