AUSTIN, Texas--(BUSINESS WIRE)--Mood Media, the world’s leading on-premise and connected media solutions company dedicated to elevating the Customer Experience, today announced that it has entered into a comprehensive Restructuring Support Agreement (the “RSA”) with certain of its lenders, noteholders and equity sponsors on the terms of a “prepackaged” financial restructuring plan that will reduce the Company’s debt by $404 million, thereby providing financial flexibility and positioning the Company for long-term success. Currently, more than 90% of the Company’s first lien term loan lenders, more than 70% of its second lien PIK noteholders, and over 60% of the Company’s equity sponsors have signed up to the RSA.
To implement the RSA, the Company is initiating a process to solicit approval of the “prepackaged” financial restructuring plan from its lenders and noteholders. Following the solicitation, no later than July 30, 2020, the Company expects to file voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas, with a confirmation hearing scheduled for July 31, 2020. The Company’s international subsidiaries will not be part of the contemplated Chapter 11 filing.
The Company will continue operating throughout the contemplated court-supervised process with a primary focus on the health and safety of its employees, independent affiliates and clients. Mood Media intends to build on its structure, support and resources to continue serving its clients as they manage through the global COVID-19 pandemic and over the longer-term once the pandemic has passed.
“We recognize this is a unique and unprecedented time for our team members, our clients and our Company,” said David Hoodis, Chief Executive Officer of Mood Media. “Like many others, we have taken difficult but necessary steps to protect our business and preserve liquidity. We are now taking action to provide a clear and expedited path to strengthen our financial position, address our debt levels and enable us to be an even better partner to our clients as the world’s leading on-premise and connected media solutions Company. We appreciate the support of our financial stakeholders, which we believe represents their confidence in our business and will enable us to move through the process on an expedited basis.”
Mr. Hoodis continued, “We thank our clients for their continued support during this unprecedented time, and we are truly grateful for their business. We look forward to working alongside our clients as they begin to open their businesses again and welcome back their employees and customers. I would also like to thank the engaged Mood employees and our independent affiliates, many of whom have been impacted by the actions we’ve been taking to protect our business over the last several months. Their continued resiliency and dedication to our clients and to each other will enable us to succeed now and well into the future.”
In connection with the expected court-supervised process, the Company has received a commitment for up to approximately $240 million in new financing, including $40 million of new capital, from HPS Investment Partners, LLC and other first lien term loan lenders. The new financing will be subject to Court approval and, together with cash generated from the Company’s ongoing operations, is expected to provide ample liquidity for the Company to continue operating in the ordinary course during and after the contemplated court-supervised process.
Subject to Court approval, the Company intends to pay vendors, suppliers and independent affiliates for goods and services provided prior to the expected filing date in the ordinary course of business. Pursuant to the terms of the financial restructuring plan, which will also be subject to Court approval, vendors’, suppliers’ and independent affiliates’ prepetition claims will be unimpaired. The Company also intends to pay vendors, suppliers and independent affiliates under normal terms for goods and services provided on or after the expected filing date.
Additional Information
Additional information is available on Mood Media’s restructuring website at www.moodmediarestructuring.com or by calling the Company’s Restructuring Hotline at (877) 606-3614 (toll-free in the U.S.) or (949) 569-5201 (for calls originating outside the U.S.). Questions can also be emailed to moodmediainfo@PrimeClerk.com. Documents and materials related to the solicitation are available on a separate website administered by Mood Media’s claims agent, Prime Clerk, at https://cases.primeclerk.com/moodmedia.
Kirkland & Ellis LLP is acting as legal advisor to Mood Media, PJ Solomon is acting as its investment banker, and Berkeley Research Group, LLC is acting as its financial advisor.
About Mood Media
Mood Media is the world’s leading on-premise and connected media solutions company dedicated to elevating the Customer Experience. We create greater emotional connections between brands and consumers through the right combination of sight, sound, scent, social and systems solutions. We reach more than 150 million consumers each day through more than 400,000 subscriber locations in 100+ countries around the globe. Mood’s clients include businesses of all sizes and market sectors, from the world’s most recognized retailers and hotels to quick-service restaurants, local banks and thousands of small businesses. For more details: www.moodmedia.com.
Forward-Looking Statements
This press release contains “forward-looking statements” related to future events. Forward-looking statements contain words such as “expect,” “anticipate,” “could,” “should,” “intend,” “plan,” “believe,” “seek,” “see,” “may,” “will,” “would,” or “target.” Forward-looking statements are based on management’s current expectations, beliefs, assumptions and estimates and may include, for example, statements regarding our pursuing protection under Chapter 11 of the Bankruptcy Code (the “Chapter 11 Cases”), the Company’s ability to complete the restructuring and its ability to continue operating in the ordinary course while the Chapter 11 Cases are pending. These statements are subject to significant risks, uncertainties, and assumptions that are difficult to predict and could cause actual results to differ materially and adversely from those expressed or implied in the forward-looking statements, including risks and uncertainties regarding the Company’s ability to successfully complete a restructuring under Chapter 11, including: consummation of the restructuring; potential adverse effects of the Chapter 11 Cases on the Company’s liquidity and results of operations; the Company’s ability to obtain timely approval by the bankruptcy court with respect to the motions filed in the Chapter 11 Cases; objections to the Company’s recapitalization process or other pleadings filed that could protract the Chapter 11 Cases; employee attrition and the Company’s ability to retain senior management and other key personnel due to the distractions and uncertainties; the Company’s ability to comply with financing arrangements; the Company’s ability to maintain relationships with suppliers, customers, employees and other third parties and regulatory authorities as a result of the Chapter 11 Cases; the effects of the Chapter 11 Cases on the Company and on the interests of various constituents, including holders of the Company’s common stock; the bankruptcy court’s rulings in the Chapter 11 Cases, including the approvals of the terms and conditions of the restructuring and the outcome of the Chapter 11 Cases generally; the length of time that the Company will operate under Chapter 11 protection and the continued availability of operating capital during the pendency of the Chapter 11 Cases; risks associated with third party motions in the Chapter 11 Cases, which may interfere with the Company’s ability to consummate the restructuring or an alternative restructuring transaction; increased administrative and legal costs related to the Chapter 11 process; potential delays in the Chapter 11 process due to the effects of the COVID-19 virus; and other litigation and inherent risks involved in a bankruptcy process. Forward-looking statements are also subject to the risk factors and cautionary language described from time to time in the reports the Company files with the U.S. Securities and Exchange Commission. These risks and uncertainties may cause actual future results to be materially different than those expressed in such forward-looking statements. The Company has no obligation to update or revise these forward-looking statements and does not undertake to do so.