Velti confirmed Chapter 11 plan of liquidation effective as of June 27

By Kali Hays

New York, June 27 – Velti, Inc.’s Chapter 11 plan of liquidation is in effect as of June 27, according to a Friday notice with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, the company obtained confirmation of the plan May 29, and the sale of substantially all company assets to GSO Capital Partners LP affiliate GSO MMBU Acquisition LLC was approved by the court in December.

The liquidation plan includes a litigation trust that was prefunded with $550,000, of which $300,000 will be distributed to general unsecured creditors under the plan and $250,000 will be held in reserve for payment of professional fees and expenses of the trust.

Velti said additional amounts received, generated or recovered by the trust will be used to pursue causes of action, to adjudicate general unsecured claims, to pay trust costs and expenses and for distribution to trust beneficiaries.

Treatment of creditors will include the following:

• Administrative claims, priority tax claims and other priority claims will be paid in full in cash, without interest;

• Holders of other secured claims will either be paid in full in cash or receive the collateral securing the claims;

• After administrative claims, other secured claims and priority claims and other wind-down costs are paid, remaining amounts in the company's estates will be paid to senior secured loan lenders. These amounts will not include any litigation trust funds;

• Holders of general unsecured claims will receive a share of distributable cash from a litigation trust except to the extent they have been paid by Velti or its purchaser before the plan effective date;

• The holder of a GSO deficiency claim will receive litigation trust cash remaining after general unsecured claims have been paid in full;

• Intercompany claims are deemed waived under a global settlement; and

• Holders of equity interests will receive no distribution.

London-based Velti provides mobile software platforms, applications and services for operators and advertising agencies in southeastern Europe, the United Kingdom and the United States. The U.S. operations filed for bankruptcy on Nov. 4, 2013 under Chapter 11 case number 13-12878.

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