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LodgeNet Files Prepackaged Chapter 11

Monday January 28th, 2013 - 10:09AM

SIOUX FALLS, SD—LodgeNet Interactive Corporation has commenced a prepackaged Chapter 11 process in the Southern District of New York in order to effect a recapitalization in which a syndicate of investors led by Colony Capital will invest $60 million in LodgeNet, as previously announced.

LodgeNet’s operations will continue as normal throughout this process and current customers will continue to receive services.

Under the terms of the plan, LodgeNet’s lenders will provide for a multi-year extension of its existing senior debt and unsecured creditors of LodgeNet will be paid in full in cash for any prepetition claims when the restructuring process has concluded.

LodgeNet also negotiated a debtor-in-possession facility from some of its lenders providing for up to $15 million in new financing, which, should the court approve, will make funds available to satisfy the customary obligations of the company’s business during the restructuring.

The company expects to complete restructuring within 60 days.