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Solutia Inc to emerge from Chapter 11
26
Feb '08
Solutia Inc announced it has reached an agreement with Citigroup Global Markets Inc, Goldman Sachs Credit Partners L.P., and Deutsche Bank Securities Inc. to fund Solutia's exit financing package and has scheduled a closing date on February 28, 2008, at which time Solutia's plan of reorganization will become effective and the company will emerge from Chapter 11.

"We are extremely pleased to have reached an agreement on the exit financing package that will result in Solutia's emergence from Chapter 11," said Jeffry N. Quinn, chairman, president and CEO of Solutia Inc. "Importantly, this agreement enables Solutia to emerge with the plan of reorganization intact, providing significant recoveries for our stakeholders and providing a firm foundation for Solutia's future success."

Under the terms of the revised exit financing package, the banks have agreed to waive the market material adverse change provision that was contained within the original loan commitment documents and increase the size of the senior secured asset-based revolving credit facility from $400 million to $450 million.

The banks will provide a $1.2 billion senior secured term loan facility at LIBOR plus 500 basis points with a minimum LIBOR floor of 350 basis points for the first four years.

Additionally, the exit financing package includes a $400 million senior unsecured bridge facility. The total cost of the financing, as well as the available liquidity of the company, issubstantially consistent with the projections that were included in the disclosure statement previously approved by the bankruptcy court.


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