Lucky Bucks’ plan, disclosure statement hearing set for July 24

By Sarah Lizee

Olympia, Wash., June 15 – Lucky Bucks, LLC’s combined hearing on confirmation of its pre-packaged Chapter 11 plan and approval of its related disclosures statement was scheduled for July 24, according to a notice filed Thursday with the U.S. Bankruptcy Court for the District of Delaware.

The confirmation objection deadline is set for July 17.

As previously reported, secured lenders holding over 86% of Lucky Bucks’ secured debt have entered into a restructuring support agreement and have agreed to equitize substantially all of Lucky Bucks’ secured debt and provide up to $43 million of new capital in the form of new first-lien debt.

The recapitalization transaction, which remains subject to court and regulatory approval, will reduce Lucky Bucks’ total secured debt by over $500 million and enhance liquidity.

The plan contemplates the reorganization of the operating companies either through a sale or through a standalone restructuring, and the winding down of the holding company.

The company’s first-lien secured lenders have also agreed to provide $82 million of debtor-in-possession financing, $20.5 million of which is new money, to fund Lucky Bucks’ capital needs during the Chapter 11 cases. The remaining amount of the facility is a rollup of existing term loans.

According to the disclosure statement, holders of Lucky Bucks HoldCo PIK note claims are expected to receive a 4% recovery. Holders will receive their pro rata share of a settlement consideration remaining after payment in full in cash of any portion of the holding company’s DIP facility from the settlement consideration, administrative claims against the holding company to the extent not paid by the DIP facility, and the funding of a wind-down escrow account.

In a stand-alone restructuring scenario, OpCo DIP claims will be paid in full in cash, or converted into loans under an OpCo exit term facility, with the new money DIP loans converted on a dollar-for-dollar basis into first-out priority exit term loans and the rolled term loans converted into the holder’s pro rata portion of the second-out priority exit term loans.

In a sale scenario, OpCo DIP claims will be paid in full in cash.

Holdings intercompany claims, interests and section 510(b) claims will be canceled with no distribution.

Holders of OpCo other secured claims and other priority claims are unimpaired by the plan.

Holders of $635.7 million of prepetition OpCo first-lien claims are expected to receive a recovery of 44% to 71%. In a stand-alone restructuring scenario, each holder of a prepetition OpCo first-lien claim will receive on account of the prepetition OpCo first-lien claim its pro rata share of (i) 100% of the new reorganized OpCo debtor equity, subject to dilution for any new reorganized OpCo debtor equity issued in connection with the lender equity allocation in connection with the OpCo exit facility, any new reorganized OpCo debtor equity allocated to the rolled term loans, if applicable, and any management incentive plan (MIP). Holders will also receive an amount of second-out priority exit term loans equal to the total second-out priority exit term loan principal amount less the amount required to refinance the rolled term loans.

In a sale scenario, holders of prepetition OpCo first-lien claims will receive their pro rata share of the sale proceeds remaining after satisfaction of the OpCo DIP claims.

Holders of OpCo general unsecured claims are expected to receive a full recovery. The projected amount of claims is $1 million to $1.4 million. Holders will receive payment in full in cash either on the effective date or in the ordinary course.

Holders of OpCo section 510(b) claims, intercompany interest, intercompany claims and equity interests are receiving nothing under the plan.

Lucky Bucks is a Norcross, Ga.-based digital skill-based coin operated amusement machine route operator. The company filed bankruptcy on June 8 under Chapter 11 case number 23-10758.

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