Global Aviation: Creditors committee, Cerberus agree to support plan

By Caroline Salls

Pittsburgh, Feb. 14 - Global Aviation Holdings Inc. requested court approval to enter into a plan of reorganization support agreement with its official committee of unsecured creditors and lender agent Cerberus Business Finance LLC, according to a Friday filing with the U.S. Bankruptcy Court for the District of Delaware.

Global Aviation said the proposed plan is subject to overbid protections set in its asset sale procedures order.

The terms of the proposed plan include the following:

• A designee of Cerberus would purchase new equity interests in reorganized Global Aviation through a credit bid of a portion of pre-bankruptcy loan claims and debtor-in-possession loan claims and conversion of a portion of the loan claims into exit financing maturing five years from the plan effective date;

• Administrative and priority claims would be paid in full in cash.

Up to 3½% of the exit financing interest would be paid in cash, and any interest in excess of that percentage would be paid in kind;

• Existing equity interests would be cancelled;

• A liquidating trust would be established for the benefit of unsecured creditors. The reorganized company will make an initial $350,000 payment to the trust, and the trust will also be vested with all non-waived Chapter 5 actions; and

• A total of 50% of trust distributions in excess of $900,000 will be distributed to Cerberus in prepayment of exit financing principal or on account of its beneficial interests.

Global Aviation, a Peachtree City, Ga.-based provider of charter air transportation for the U.S. military and of commercial global passenger and cargo air transportation services, filed for bankruptcy on Nov. 12. The Chapter 11 case number is 13-12945.

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