Zachry Holdings, Inc. and its affiliates have filed a modified first amended joint Chapter 11 plan of reorganization and accompanying disclosure statement in the U.S. Bankruptcy Court for the Southern District of Texas (Case No. 24-90377), detailing their strategy to restructure approximately $281.25 million in funded debt obligations while maintaining operations.
The San Antonio-based engineering and construction services company, represented by White & Case LLP, submitted the modified plan on January 23, 2025, following unsuccessful attempts to secure junior exit financing under their initial reorganization proposal. The new plan eliminates the need for additional capital raising while preserving the same economic value for stakeholders.
Key elements of the restructuring include:
- Amendment and restatement of the company's prepetition credit facility
- Creation of a General Unsecured Claims (GUC) trust for creditors
- A $50 million capital contribution from Zachry's parent company, comprising $30 million in cash and $20 million in forgiveness of intercompany liabilities
- Full assumption of the company's deferred compensation plan, affecting 315 participants with approximately $62.58 million in obligations
The plan provides for two voting classes: Class 3 (Prepetition Credit Facility Claims) and Class 6 (General Unsecured Claims). Notably, convenience claims of $25,000 or less will receive full payment in cash.
The disclosure statement indicates that creditors holding approximately $132.50 million in outstanding trade debt will be treated under various categories, with about $57.40 million classified as general unsecured claims under the plan.
A hearing on the plan is scheduled for February 26, 2025, at 1:30 p.m. Central Time, with voting deadlines set for February 20, 2025.
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Document length: 80 pages