INAP and its 6 affiliated debtors filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York on 16 March.
$75 million financing
INAP affiliates consist of Datagram LLC, Hosting Intellect LLC, Internap Connectivity LLC, SingleHop LLC, Ubersmith, Inc., and Internap Technology Solutions Inc. (collectively with INAP, the “INAP RSA Parties” or the “Company”).
Peter Aquino, INAP Chairman, and Chief Executive Officer talked about INAP’s voluntary petition, saying,
“INAP has been exploring strategic alternatives and financial initiatives to best position the Company in an ever-evolving IT infrastructure landscape. After a thoughtful evaluation of all available options, today, we are taking decisive action to strengthen our capital structure.
We expect to emerge quickly, financially stronger and well positioned to deliver our comprehensive portfolio of premium data center infrastructure, best-in-class cloud solutions and high-performance network services well into the future.”
They entered into a Restructuring Support Agreement (the “RSA”) with an ad hoc lender group holding approximately 77% of its outstanding term loans. The Ad Hoc Lender Group provides financing of $75 million to continue operating as usual and position the Company to drive future growth. The Company will operate at the position “debtors-in-possession” under the jurisdiction of the Bankruptcy Court. Michael Sicoli, INAP President and Chief Financial Officer said:
“We appreciate the support we have received from our existing lender group, which underscores their belief in our business and commitment to its growth. We look forward to working with them closely as we move ahead to invest in our business to meet the ever-growing demands of our customers and channel partners.”
Chapter 11 of the U. S. Bankruptcy Code enables a company to reorganize by forming a corporation or partnership. A Chapter 11 case begins with an involuntary or voluntary petition of a debtor who usually proposes a plan of reorganization to keep its business alive and pay creditors over time.