Holley Performance Products granted court approval for pre-packaged plan of reorganization

By Jennifer Lanning Drey

Portland, Ore., March 18 - Holley Performance Products Inc. obtained court approval for its pre-packaged plan of reorganization, according to a Tuesday filing with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, the plan is based on a restructuring agreement with a majority of its secured noteholders.

Under the pre-packaged plan, Holley's second-lien notes will be exchanged for $50 million in new 51/2-year 12½% second-lien notes and second-lien note shares, and the company's unsecured notes will be exchanged for either cash equal to $100 per $1,000 of note claims or for 48 unsecured warrants for each $1,000 of note claims.

Plan creditor treatment

Treatment of creditors will include:

• Holders of administrative claims, priority tax claims, pre-bankruptcy indenture trustee fees and expenses claims, DIP credit agreement claims and other priority claims will recover 100% in cash;

• Holders of $145.83 million in second-lien note claims will recover 45.8% in new second-lien notes and note shares;

• Other secured claims and general unsecured claims will be reinstated;

• Holders of $4.17 million in unsecured note claims will recover 10% in cash or warrants;

• Holders of subordinated securities claims and Holley equity interests will receive no distribution under the plan; and

• Holley subsidiaries' equity interests will remain outstanding.

Holley is a Bowling Green, Ky.-based maker of high-performance carburetors and other automotive engine equipment. Its Chapter 11 case number is 08-10256.

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