Hawaiian Telecom's disclosure statement approved; plan hearing Oct. 7

By Alice Popovici

New York, Aug. 31 - Hawaiian Telecom Communications Inc.'s disclosure statement for its plan of reorganization was approved Friday, according to a filing with the U.S. Bankruptcy Court for the district of Hawaii.

A plan confirmation hearing is scheduled for Oct. 7.

Under the plan:

• About $590 million of the company's senior secured credit facility and swap liabilities will be converted into new equity of the reorganized company and a new $300 million five-year senior secured term loan;

• Holders of $350 million in senior notes will receive warrants to acquire 12.75% of the new equity of the reorganized company and subscription rights to purchase up to $50 million of new equity;

• Holders of general unsecured claims will receive their share of a cash distribution; and

• Existing 12½% senior subordinated notes and existing common shares will be cancelled.

The company said it expects to have a $30 million undrawn revolving credit facility at emergence, as well as at least $45 million of cash on hand after plan distributions are made.

Hawaiian Telcom, Inc., a Honolulu-based telecommunications provider, filed for bankruptcy on Dec. 1 in the U.S. Bankruptcy Court for the District of Delaware. The case was later transferred to Hawaii. The company's Chapter 11 case number is 08-02005.

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