In the matter of TCI 2 Holdings, LLC, et al., Debtors, 428 B.R. 117

Summary

Both plans provided for full satisfaction of the claims of the lenders and continuation of the debtors' operations. The debtors' plan also provided for an equity distribution to the second lien creditors, a nominal distribution to unsecured creditors, and subscription rights in new stock of the debtors. The lenders' plan provided for no distribution to the second lien creditors or unsecured creditors and resulted in the debtors' emergence from bankruptcy with no debt. The bankruptcy court held that both plans, with modifications, were confirmable, but the debtors' plan was the more beneficial to all creditors and equity security holders. While the lenders' plan was the more feasible plan in deleveraging of the debtors and infusion of capital in the form of equity, leaving the debtors with a clean balance sheet and adequate capital to rebuild the business, the debtors' plan clearly was more advantageous to creditors. Further, an overwhelming number of creditors voted in favor of the ...