TOUSA, Inc. Files Plan of Reorganization and Disclosure Statement
14 Octobre 2008 - 2:45PM
PR Newswire (US)
'Stand-Alone' Plan Calls for Conversion of More Than $300M in
Second Lien Debt to Equity HOLLYWOOD, Fla., Oct. 14 /PRNewswire/ --
TOUSA, Inc. (Pink Sheets: TOUS) and certain of its subsidiaries,
today announced the filing of their Plan of Reorganization (the
"Plan") and related Disclosure Statement (the "Disclosure
Statement") with the U.S. Bankruptcy Court for the Southern
District of Florida, Fort Lauderdale Division. "The filing of our
Plan of Reorganization is an important achievement and we are
excited to announce this development. We have made significant
progress over the past nine months in restructuring our operations
and have transformed our business in this very difficult market
environment. Our 'stand-alone' Plan of Reorganization includes a
substantial reduction in our debt obligations, allowing us to
emerge from Chapter 11 with a stronger balance sheet and greater
financial flexibility that will position TOUSA to compete
effectively in the industry and to continue to deliver quality
homes to our customers," said TOUSA CEO and President, John R.
Boken. Key provisions of the Company's Plan, as filed with the
Bankruptcy Court, include: -- The conversion of more than $300
million in Second Lien debt to equity and full ownership of the
restructured enterprise, subject to the outcome of certain
litigation. -- Use of the Company's significant cash balance at
emergence, which is expected to be in the range of $125 million to
$145 million, to fund operations post-emergence. -- The
extinguishment of approximately $1 billion in bond debt and
approximately $600 million of other unsecured obligations. -- The
creation and funding of a litigation trust for the purpose of
continuing to pursue certain claims, including the Creditors'
Committee Action, challenging the liens of certain secured
creditors of TOUSA, and the distribution of litigation trust
interests to unsecured creditors, while at the same time preserving
the status quo of the relative rights, claims and defenses of all
parties to the Committee Action, including the defendants named
therein. -- Issuance of new first lien debt to the Company's first
lien bank creditors such that they will receive full payment of
their claims, subject to the outcome of certain litigation. --
Issuance of $15 million in new second lien debt to the Company's
second lien bank creditors in partial satisfaction of their claims,
subject to the outcome of certain litigation. -- Current holders of
TOUSA common stock will receive no distribution, and those
securities will be canceled and shall be of no further force or
effect. "The filing of our Plan of Reorganization represents the
culmination of an extensive effort to identify and pursue numerous
opportunities to restore TOUSA's financial health and maximize
recoveries for our creditors. As we move through the next stages of
this process, we will continue to work closely with the holders of
our second lien debt, and our other creditor constituencies, to
explore potential variations that may result in modifications to
certain aspects of the Plan of Reorganization," added Mr. Boken.
Upon emergence from Chapter 11, the TOUSA enterprise will continue
to be a leading national homebuilder. Moreover, the Company's
non-debtor affiliates Universal Land Title, Inc., Preferred Home
Mortgage Company and Alliance Insurance and Information Services
will remain an integral part of Company operations and an important
element of TOUSA's service offering. The Plan consists of separate
Chapter 11 plans for each of the 39 Debtor entities. However, the
plans for the majority of the Debtors provide for identical
treatment for similarly situated classes of creditors. The
Disclosure Statement includes an overview of the Company's
restructuring progress and other information about the Company, a
description of distributions to creditors and an analysis of the
Plan's feasibility, as well as many of the technical matters
required prior to exiting from Chapter 11, such as descriptions of
who will be eligible to vote on the Plan and the voting process.
Copies of the Plan and Disclosure Statement materials can be found
at http://www.tousa.com/reorg. In addition, TOUSA will file a Form
8-K with the Securities and Exchange Commission,
http://www.sec.gov/. TOUSA, Inc., and certain subsidiaries filed
voluntary petitions for Chapter 11 under the U.S. Bankruptcy Code
on January 29, 2008. About TOUSA, Inc. TOUSA, Inc. is a leading
homebuilder in the United States, operating in various metropolitan
markets in 10 states located in four major geographic regions:
Florida, the Mid-Atlantic, Texas, and the West. TOUSA designs,
builds, and markets high-quality detached single-family residences,
town homes, and condominiums to a diverse group of homebuyers, such
as "first-time" homebuyers, "move-up" homebuyers, homebuyers who
are relocating to a new city or state, buyers of second or vacation
homes, active-adult homebuyers, and homebuyers with grown children
who want a smaller home ("empty-nesters"). It also provides
financial services to its homebuyers and to others through its
subsidiaries, Preferred Home Mortgage Company and Universal Land
Title, Inc. This press release may contain forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, including statements regarding the intent,
belief or current expectations of the Company and its management.
Any such forward-looking statements are not guarantees of future
performance and involve a number of risks and uncertainties that
could materially affect actual results such as, but not limited to:
(i) the Company's ability to continue as a going concern; (ii) the
ability of the Company to operate pursuant to the terms of its cash
collateral arrangement with its secured lenders; (iii) the
Company's ability to obtain court approval with respect to motions
in the Chapter 11 proceeding; (iv) the ability of the Company to
develop, confirm and consummate one or more plans of reorganization
with respect to the Chapter 11 proceeding; (v) risks associated
with third parties seeking and obtaining court approval to
terminate or shorten the exclusivity period for the Company to
propose and confirm one or more plans of reorganization, for the
appointment of a Chapter 11 trustee or to convert the cases to
Chapter 7 cases; (vi) the ability of the Company to obtain and
maintain normal terms with vendors and service providers; (vii) the
Company's ability to maintain contracts that are critical to its
operations; (viii) the potential adverse impact of the Chapter 11
cases on the Company's liquidity or results of operations; (ix) the
ability of the Company to fund and execute its business plan;(x)
the ability of the Company to attract, motivate and/or retain key
executives and employees; (xi) the ability of the Company to
attract and retain customers and (xii) other risks and factors
regarding the Company and the home building industry identified
from time-to-time in the Company's reports filed with the SEC,
including the risk factors identified in its Annual Report on Form
10-K for the year ended December 31, 2007, which can be found on
the Company's website at http://www.tousa.com/. All information set
forth in this news release is as of today's date, and the Company
undertakes no duty to update this information. DATASOURCE: TOUSA,
Inc. CONTACT: Jennifer E. Mercer of Van Meter Inc.,
+1-954-364-4013, Web Site: http://www.sec.gov/
http://www.tousa.com/ http://www.tousa.com/reorg
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