Common Stock to Cease Trading on May 14, 2009
Source Interlink Companies, Inc. (Nasdaq:SORC), one of the largest
publishers of magazines and online content for enthusiast audiences and
a leading distributor of DVD's, CD's, magazines, video games and books
today provided an update concerning its structured reorganization and
announced that its common stock will cease trading on the The Nasdaq
Stock Market at opening of business on May 14, 2009.
On Tuesday, April 28, 2009, the Company announced that it had reached a
restructuring agreement to take the Company private and eliminate nearly
$1 billion of its existing debt. To facilitate the restructuring, the
Company filed a lender-approved pre-packaged Plan of Reorganization
under Chapter 11 of the U.S. Bankruptcy Code. During first day motions,
held Wednesday, the Court entered various orders to enable the Company
to continue operations in the ordinary course, including authorization
to pay all vendors in full and on time if they agree to maintain current
credit and payment terms and approval of a $385 million
debtor-in-possession financing arrangement. The financing arrangement
was consummated on Thursday and vendors began receiving payment of
pre-filing charges immediately. Recognizing the unique nature of the
case and the parties’ desire for a prompt conclusion of the proceedings,
the Court set a hearing for May 28, 2009 to confirm the Company’s Plan
of Reorganization.
In accordance with the Company’s plan to go private, The Nasdaq Stock
Market informed the Company by letter dated May 5, 2009 that the
Company’s common shares would be delisted and all trading suspended at
the opening of business on May 14, 2009 pursuant to NASDAQ Marketplace
Rules 5100, 5110(b), IM-5100-1 and 5250(c)(1). The action followed the
filing of the Company’s Plan of Reorganization and decision to devote
its resources to the restructuring process rather than the filing of its
Annual Report on Form 10-K for the fiscal year ended January 31, 2009.
Because the delisting is a necessary step in the Company’s plan to go
private, the Company does not intend to request a hearing before the
Nasdaq Listing Qualifications Panel to appeal the decision.
Source Interlink Chairman and Chief Executive Officer Greg Mays said,
“We continue to be very pleased with the progress made this week in our
plan to go private and eliminate a substantial portion of our existing
debt. We are also pleased with the response of our trading partners, all
of which have enthusiastically supported our plan. Our restructuring is
progressing better than expected. We are on schedule to emerge shortly
with significantly less debt, materially reduced interest expense and
substantially improved free cash flow allowing us to capitalize on
several operational opportunities to further improve and grow our
business. Our restructuring also will permit our employees to continue
to do what they do best - provide exceptional service to our customers.”
ABOUT SOURCE INTERLINK COMPANIES, INC. Source Interlink
Companies, Inc. (NASDAQ:SORC), a media and marketing services company,
is a leading U.S. distributor of home entertainment products and
services and one of the largest publishers of magazines and online
content for enthusiast audiences. Source Interlink Media, LLC publishes
more than 75 magazines and 90 related Web sites. Source Interlink
Distribution, LLC services tens of thousands of retail store locations
throughout North America distributing DVDs, music CDs, magazines, video
games, books, and related items. In addition to distributing more than
6,000 distinct magazine titles annually, the Company maintains the
largest in-stock catalog of CDs and DVDs in the US -- a combined total
of more than 260,000 titles. Supply chain relationships include consumer
goods advertisers, subscribers, movie studios, record labels, magazine,
book, and newspaper publishers, confectionary companies and
manufacturers of general merchandise.
For more information about the reorganization go to: www.SourceInterlink.com
and click on the Reorganization Information tab or contact Cynthia
Beauchamp, at (239) 949-7624.
Source Interlink Companies, Inc., Bonita Springs
Cynthia Beauchamp,
239-949-7624
