The cross-border restructuring of North Star Manufacturing (London) Ltd. (“North Star”) and Atrium Companies, Inc. (together with North Star and 18 of its US subsidiaries, “Atrium”) pursuant to the Companies' Creditors Arrangement Act (Canada) (the “CCAA”) and Chapter 11 of the US Bankruptcy Code was completed on April 30, 2010, 100 days following the commencement of proceedings on January 20, 2010.
North Star, the only Canadian subsidiary in Atrium's group, commenced proceedings pursuant to both the CCAA and Chapter 11.
As a result of the balance sheet restructuring, Atrium has reduced its outstanding debt by almost 60 per cent, from US$680 million at the time of the filings to approximately US$280 million at emergence on April 30, 2010.
In addition, Atrium secured US$170 million in new equity commitments from Golden Gate Capital and Kenner & Company, and US$280 million in new exit financing. Golden Gate Capital and Kenner & Company have acquired 92.5 per cent of the reorganized parent company's new common stock. Former bondholders have received the remaining 7.5 per cent of the new common stock.
Through the CCAA and Chapter 11 proceedings, Atrium effected a pre-negotiated plan of reorganization pursuant to Chapter 11 that was subsequently recognized and implemented in Canada under the CCAA.
In connection with the Chapter 11 plan, Atrium obtained a commitment from GE Business Financial Services Inc. (as agent) to provide debtor-in-possession financing, consisting of a US$40,000,000 delayed draw term loan.
The plan was confirmed by the US Bankruptcy Court on April 28, 2010, and on April 29, 2010, Justice Colin Campbell entered an order recognizing and implementing in Canada the Chapter 11 Plan of Reorganization.
The exit financing closed on April 30, 2010, which was the Plan effective date.
Leading the restructuring for Atrium was Philip Ragona, Atrium's Senior Vice President and General Counsel, and Robert Reed, Atrium's Director of Litigation and Assistant General Counsel. North Star was represented in Canada by a team from Goodmans LLP that included Jay Carfagnini, Brian Empey and Lauren Cappell (restructuring), David Wiseman, Jonathan Freeman and Ronna Wiens (banking and finance) and Ira Barkin (real estate).
Richard Cieri, Joshua Sussberg, Brian Schartz, Manoj Ramia (restructuring) and Ari Mintzer (finance) of Kirkland & Ellis LLP acted as US bankruptcy counsel to Atrium, with Domenic Pacitti of Klehr Harrison Harvey Branzburg LLP acting as Delaware counsel. Ari Mintzer and Joseph Laws of Kirkland & Ellis represented Atrium in respect of the UBS term loan credit agreement and the Golden Gate Capital mezzanine debt financing. Joel Simon, Michael Chernick, Rick Denhup, Bret Votano and Ingrid Fuentes of Paul, Hastings, Janofsky & Walker LLP represented Atrium in respect of the GE asset-backed revolving credit agreement; and Luke Iovine, Joel Simon and Claudia Kim of Paul Hastings represented Atrium in the sale of reorganized Atrium's common stock.
UBS AG and GE were represented by a team from Latham & Watkins LLP that included Christopher Plaut, Rajani Gupta, Amber Haywood, Doug Bacon and Robert Drobnak.
The Plan Investor (Golden Gate Capital and Kenner & Company) was represented by a team from Curtis, Mallet-Prevost, Colt & Mosle LLP that included Steven Reisman and Lara Sheikh, with Kenner & Company also being represented by a team from Hughes Hubbard & Reed LLP that included Kathryn Coleman.
Atrium's noteholders were represented by a team from Wachtell, Lipton, Rosen & Katz that included Scott Charles and Michael Benn.
The unsecured creditors' committee appointed in connection with the Chapter 11 proceeding was represented by a team from Otterbourg, Steindler, Houston & Rosen, P.C. that comprised Scott Hazan, David Posner and Jenette Barrow-Bosshart.
Ernst & Young Inc. acted as the court-appointed monitor in the CCAA proceedings, with Derrick Tay and Evan Cobb (restructuring), and Randy Sutton (litigation) of Ogilvy Renault LLP acting as Canadian counsel to the monitor, and Ken Coleman and Amélie Baudot of Allen & Overy LLP acting as US counsel to the monitor.
Other key Canadian participants in North Star's restructuring included: (i) GE as agent, represented in Canada by Kevin McElcheran and James Gage (restructuring) and Richard Higa (banking and finance) of McCarthy Tétrault LLP; (ii) UBS AG by Peter MacGowan and Alexis Levine (financial services), Christopher Burr (restructuring), Iris Tam (real estate) and Gary Daniel (intellectual property) of Blake, Cassels & Graydon LLP; (iii) Royal Bank of Canada, represented by David Ullmann and Melissa McCready (restructuring) of Minden Gross LLP; and (iv) Canada Revenue Agency, represented by Diane Winters of the Department of Justice.