Relativity Media submitted a reorganization plan to U.S. Bankruptcy Court on Wednesday that claims it will reduce its debt below $60 million, raise $100 million in new equity and release up to seven of its orphaned movies within 18 months after its planned emergence from Chapter 11 in January 2016.
“Relativity today took a significant step forward in its chapter 11 process and filed a plan of reorganization with the court. Upon emergence in late January, the company’s $35 million DIP loan will be paid in full, its debt load will be reduced to $60 million or less, and it expects to receive up to $100 million in new equity,” a Relativity spokesperson said.
“Additionally, Relativity plans to release seven films funded in part by a new $250 million Ultimates/P&A facility. As is often the case in complex chapter 11 cases, the plan may evolve as the parties refine negotiations.”
The proposed reorganization plan requires the approval of New York Bankruptcy Court Judge Michael Wiles. The next court hearing in the Relativity case is scheduled for December 16.
The $100 million in capital comes from a pact with Chicago- and New York-based investor Jim Cantelupe of Summit Trail Advisors, with funds to be escrowed on or before the end of the year. More importantly, perhaps, than a capital infusion is Relativity’s stated plan to settle its obligations to creditors and the cash loan or “debtor-in-possession” financing, that it has used for daily operations since filing for bankruptcy in July.
The company said it intends to completely repay its $35 million DIP loan in January, and reduce overall debt to less than $60 million. Unsecured creditors will receive roughly $4 million in cash payments and “the opportunity to share with the company in future recoveries.”
The films Relativity purports to roll out include: Kristen Wiig‘s “Masterminds,” Kate Bosworth‘s “Before I Wake,” Kate Beckinsale‘s “The Disappointments Room,” Halle Berry’s “Kidnap,” Lake Bell‘s “Shot Caller,” the Rooney Mara-Theo James drama “Secret Scripture” and Colin Farrell’s “Solace.”