Romano’s Macaroni Grill operator files reorganization plan, disclosure

By Caroline Salls

Pittsburgh, Oct. 26 – Mac Acquisition LLC, also known as Romano’s Macaroni Grill, filed its plan of reorganization and related disclosure statement Wednesday with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, Romano’s filed its Chapter 11 cases to implement a balance sheet and operational restructuring “that will allow the debtors to re-emerge as a successful leading casual dining restaurant chain.”

The proposed plan has the support of two of the company’s largest secured creditors, Bank of Colorado and Riesen Funding LLC. According to Machado, those creditors both entered into a restructuring support agreement with Romano’s.

While the company believes the plan will provide the greatest opportunity for it to promptly emerge from bankruptcy and make distributions to creditors, Romano’s said when it filed bankruptcy that it is also currently looking to hire an investment banker to market its companies and assets on a parallel path with the plan process.

If the marketing process identifies a third party that is willing to pay a purchase price that provides greater value for the estate than the proposed plan, both the restructuring support agreement and the company’s debtor-in-possession financing agreement contain “fiduciary outs” that would allow Romano’s to pursue an alternative sale transaction.

Under the plan, administrative claims, priority tax claims, other priority claims and debtor-in-possession credit agreement claims will be paid in full in cash.

Holders of other secured claims will either be paid in full in cash, receive the proceeds from the sale of the collateral securing the claims or receive the collateral.

Holders of Bank of Colorado claims will receive a share of a $3.5 million cash payment, $41,667 reach month for 24 months to be applied to the reduction of the principal amount of the claim, payment of interest only at the rate of 5% on the remaining balance owed and reinstatement of letters of credit that remain issued.

Holders of Riesen claims will receive a share of equity in the reorganized company.

The new equity interests will be subject to dilution if warrants to acquire 5% of the interests granted under the company’s exit facility are exercised.

Holders of general unsecured claims will receive a share of a cash pool if the class votes to accept the plan or no distribution if it does not.

Holders of existing equity interests and subordinated claims will receive no distribution.

The disclosure statement hearing is scheduled for Dec. 4.

Mac Acquisition operates full-service casual dining restaurants. The company filed bankruptcy on Oct. 18 under Chapter 11 case number 17-12224.

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