TLCVision to Restructure Debt in Pre-Arranged Chapter 11 Filing
22 December 2009 - 2:21AM
Marketwired
TLC Vision Corporation (NASDAQ: TLCV) (TSX: TLC), North America's
premier eye care services company, said today that it has reached
an agreement with holders of a majority of the Company's senior
secured debt to restructure its balance sheet.
To expedite its financial restructuring, which includes a
pre-arranged plan of reorganization, the Company and two of its
wholly owned subsidiaries, TLC Vision (USA) Corporation and TLC
Management Services Inc., have filed voluntary petitions under
Chapter 11 of the U.S. Bankruptcy Code in the United States
Bankruptcy Court for the District of Delaware. In addition, the
Company is seeking a recognition of its Chapter 11 filing in a case
that it is commencing in the Ontario Superior Court of Justice
under the Canadian Companies' Creditors Arrangement Act. No other
company operations, affiliates or subsidiaries -- including its TLC
Laser Eye Centers -- are involved in the filing.
TLCVision said clinical care for patients continues without
change or interruption. TLCVision will continue to honor the TLC
Lifetime Commitment. The Company also said the filing will not
affect its on-going commitments to current employees.
The Company said that it and a group of its senior secured
lenders have agreed on a Chapter 11 plan of reorganization. The
plan provides for the following: a conversion of certain of the
funded indebtedness to 100% of the new equity of TLC Vision (USA)
Corporation, which will emerge as a privately held Company;
reinstatement of the balance of the funded indebtedness on
restructured terms and conditions; payments to employees and
critical vendors in the ordinary course of business; and
distributions to certain secured and unsecured creditors. There is
no assurance of any distribution of funds to the shareholders of
the Company under the plan.
TLCVision President and Chief Operating Officer Jim Tiffany
said, "This proceeding will enable us to continue providing our
surgeons and eye care professionals with the tools, technologies
and services they need to deliver high-quality patient care. After
evaluating a number of strategic alternatives with our board of
directors and advisors, we decided that restructuring our debt
through court protection was the best way to preserve the value of
our business.
"We expect to emerge swiftly from Chapter 11 with a stronger
balance sheet and able to better capitalize on our industry
leadership position."
In conjunction with today's announcement, TLCVision filed a
number of first-day motions that will allow it to continue to
operate in the ordinary course during the restructuring process.
These motions include: immediate approval of use of a $15 million
debtor-in-possession financing facility; continued payment of
wages, salaries and other employee benefits; and authority to use
its cash collateral. Additionally, the Company filed a motion
seeking the necessary relief from the Court to pay certain critical
vendors in full. In conjunction with the filing, the Company has
also reached agreement to sell its six refractive centers in
Canada. Closing of the transaction is subject to customary
conditions and approval of the Bankruptcy Court. The Canadian
centers will continue to operate under the TLC Canada name.
For access to Court documents and other general information
about the Chapter 11 cases, please visit
http://chapter11.epiqsystems.com/tlcvision. In addition, we have
established a restructuring hotline: 877-879-5075 for US and Canada
callers, 503-597-7713 for International callers. The Company's lead
U.S. restructuring counsel is the law firm of Proskauer Rose LLP
and Canadian restructuring counsel is the law firm of Torys LLP.
The Company's financial advisor is Conway Del Genio Gries &
Co., LLC.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of Section 27A of the U.S. Securities Act of
1933, Section 21E of the U.S. Securities Exchange Act of 1934 and
Canadian Provincial Securities Laws, which statements can be
identified by the use of forward-looking terminology, such as
"may," "will," "expect," "intend," "anticipate," "estimate,"
"predict," "plans" or "continue" or the negative thereof or other
variations thereon or comparable terminology referring to future
events or results. We caution that all forward-looking information
is inherently uncertain and that actual results may differ
materially from the assumptions, estimates or expectations
reflected in the forward-looking information. A number of factors
could cause actual results to differ materially from those in
forward-looking statements, including but not limited to economic
conditions, the level of competitive intensity for laser vision
correction, the market acceptance of laser vision correction,
concerns about potential side effects and long term effects of
laser vision correction, the ability to maintain agreements with
doctors on satisfactory terms, quarterly fluctuation of operating
results that make financial forecasting difficult, the volatility
of the market price of our common shares, profitability of
investments, successful execution of our direct-to-consumer
marketing programs, the ability to open new centers, the reliance
on key personnel, medical malpractice claims and the ability to
maintain adequate insurance therefore, claims for federal, state
and local taxes, compliance with industry regulation, compliance
with U.S. and Canadian healthcare regulations, disputes regarding
intellectual property, many of which are beyond our control.
Therefore, should one or more of these risks materialize, or
should assumptions underlying the forward-looking statements prove
incorrect, actual results may vary significantly from what we
currently foresee. Accordingly, we warn investors to exercise
caution when considering any such forward-looking information
herein and to not place undue reliance on such statements and
assumptions. We are under no obligation (and we expressly disclaim
any such obligation) to update or alter any forward-looking
statements or assumptions whether as a result of new information,
future events or otherwise, except as required by law. See the
Company's reports filed with the Canadian Securities Regulators and
the U.S. Securities and Exchange Commission from time to time for
cautionary statements identifying important factors with respect to
such forward-looking statements, including certain risks and
uncertainties, that could cause actual results to differ materially
from results referred to in forward-looking statements. TLCVision
assumes no obligation to update the information contained in this
press release.
About TLCVision
TLCVision is North America's premier eye care services company,
providing eye doctors with the tools and technologies needed to
deliver high-quality patient care. Through its centers' management,
technology access service models, extensive optometric
relationships, direct to consumer advertising and managed care
contracting strength, TLCVision maintains leading positions in
Refractive, Cataract and Eye Care markets. Information about vision
correction surgery can be found on the TLC Laser Eye Centers'
website at www.tlcvision.com.
Contacts: Investor: James J. Hyland VP Investor Relations (636)
534-2369 Email: investor.relations@tlcvision.com Media: Stephen
Phillips Fleishman Hillard (314)-982-8754
stephen.phillips@fleishman.com
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