New Delaware Chapter 11 Filing – ATD Corporation (American Tire Distributors)
ATD Corporation, along with nine affiliates and subsidiaries, has filed a petition for relief under chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Lead Case No. 18-12221). ATD, headquartered in Huntersville, North Carolina, is the largest replacement tire distributor in North America, with 122 distribution centers across the United States and another 24 in Canada. According to the First Day Declaration, ATD’s filing was precipitated by the recent decisions of Goodyear Tire & Rubber Company and Bridgestone Americas, Inc. to cease using ATD as a distributor of their products and instead form a joint venture competing against ATD. According to ATD’s press release, ATD enters chapter 11 having reached a restructuring support agreement with its bondholders, who have agreed to exchange over $1 billion in outstanding bonds for 95% of the equity in the reorganized ATD. ATD is also seeking authority for a DIP facility from ATD’s prepetition ABL Lenders, which will provide up to $200 million in new money financing. Kurtzman Carson Consultants is the proposed claims and noticing agent. The cases have been assigned to the Honorable Kevin J. Carey.
Contact Norman L. Pernick, G. David Dean or Myles R. MacDonald for more information regarding this matter.
As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.
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