Citadel Broadcasting emerges from pre-packaged bankruptcy case

By Caroline Salls

Pittsburgh, June 3 - Citadel Broadcasting Corp. completed its financial restructuring and emerged from Chapter 11 bankruptcy on Thursday, according to a company news release.

Citadel's plan of reorganization was confirmed on May 19 by the U.S. Bankruptcy Court for the Southern District of New York.

As previously reported, Citadel made a pre-packaged Chapter 11 bankruptcy filing in December after reaching an agreement with more than 60% of its senior secured lenders on the terms of a pre-negotiated financial restructuring that extinguishes $1.4 billion of debt.

Under the plan:

• Citadel's secured lenders will receive a new $762.5 million five-year term loan, which will bear interest at Libor plus 800 basis points, 90% of the new common stock in the reorganized company and any amount of cash by which the total amount of the company's unrestricted cash on the effective date exceeds the sum of $86 million and the sum of estimated unpaid fee claims accrued as of the effective date, unpaid cure claims, unpaid administrative claims, fees payable in connection with the new term loan, unpaid priority non-tax claims and priority tax claims, a subordinated notes indenture trustee fee and a subordinated notes paying agent fee;

• Holders of general unsecured claims, including the secured lenders' deficiency claim, will receive a share of 10% of the new common stock and $36 million in cash; and

• All equity interests in Citadel will be cancelled or extinguished on the plan effective date.

Citadel, a Las Vegas-based radio broadcasting company, filed for bankruptcy on Dec. 20, 2009. Its Chapter 11 case number is 09-17442.

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