Current business will continue while Chapter 11 proceedings commence
NEW YORK, Feb. 01, 2016 (GLOBE NEWSWIRE) -- SFX Entertainment, Inc. (NASDAQ:SFXE) (the "Company") today announced that it has reached an agreement with an ad hoc group of bondholders ("ad hoc group") to significantly restructure the Company's outstanding debt. SFX and the ad hoc group have entered into a Restructuring Support Agreement ("RSA") that will eliminate more than $300 million in debt from its balance sheet, provide significant working capital and convert the majority of the bondholder group debt into equity in a newly strengthened private company.
In order to facilitate the restructuring, SFX Entertainment, Inc. has today filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. The Company's international operating subsidiaries are not included and will not be impacted by the filing. Moreover, the Company will continue to prepare for, plan and produce all of its festivals and events around the world and in the United States without interruption.
Robert F.X. Sillerman, Chairman and CEO said, "This expression of confidence from our lenders is testimonial to the vibrancy and potential of our business, and the dedication and professionalism of the over 600 people who make up SFX. Of course this was not where we thought we'd be but with this restructuring we have the opportunity to achieve all that SFX can and will be. I'm looking forward to continuing to be part of the new SFX as Chairman. We will immediately commence a search for a new CEO to lead us as we continue to set the trend in the exploding culture that is electronic music."
SFX anticipates moving expeditiously through this process. The RSA includes a commitment from the ad hoc group to provide up to $115 million in DIP (debtor-in-possession) financing. This financing, which is subject to court approval, will be used to pay ongoing, normal course of business, obligations including artists, venues, sponsors, partners, vendors and suppliers. All scheduled and planned events and festivals will take place without interruption providing SFX's millions of fans an uninterrupted season of spectacular experiences.
The Company and the ad hoc group have agreed to the principal terms of a Chapter 11 Plan of Reorganization, which will be subject to approval by the Bankruptcy Court. Moreover, upon emergence, the DIP loan will convert to provide a fully funded exit from Chapter 11.
Michael Katzenstein, of FTI Consulting, Inc. is serving as the Company's Chief Restructuring Officer, Greenberg Traurig, LLP is serving as legal advisor and Moelis & Company is the Company's investment banker.
Additional information, including court filings and other documents related to the reorganization, can be found by visiting www.kccllc.net/SFX or by calling 888-201-2205 (in the U.S.) or +1-310-751-1839 (international callers). Vendors or suppliers with inquiries can call the numbers above or send an email to firstname.lastname@example.org.