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3/18/2002



Rail News: Rail Industry Trends

RailWorks files reorganization plan with federal bankruptcy court


RailWorks Corp. March 15 announced that it recently filed a reorganization plan for the corporation and its 22 U.S. debtor subsidiaries in a Baltimore federal bankruptcy court.
The plan, approved by RailWorks' secured lenders and primary surety, calls for full repayment of debtor-in-possession (DIP) claims, satisfaction of secured claims held by certain pre-petition secured lenders through the issuance of a new secured note, and satisfaction of the balance of claims held by pre-petition secured lenders through the conversion of such claims into substantially all of the reorganized company's equity.
Under the plan, RailWorks would issue 3 percent of the reorganized company's stock to holders of RailWorks' $175 million 11.5 percent senior subordinated notes due in 2009 and to unsecured creditors, and eliminate equity holders' interests in RailWorks.
The reorganized company would receive $250 million in debt financing and $350 million in surety bonding capacity.
RailWorks also filed a motion requesting bankruptcy court approval to file by April 2 its disclosure statement providing plan details.
The corporation in September voluntarily filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The rail product and service supplier's Canadian operations aren't included in the filings and continue to operate outside bankruptcy.


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