SuperMedia Secures Approval for Prepackaged Bankruptcy

April 30, 2013

SuperMedia and Dex One completed their merger and emerged from chapter 11 bankruptcy protection on April 30 after a Delaware Bankruptcy Court approved their twin, prepackaged bankruptcy plans. The new company, Dex Media, will be one of the largest national providers of social, local and mobile marketing solutions through direct relationships with local businesses. The common stock of Dex Media began trading May 1, 2013 on the NASDAQ stock exchange under the symbol: DXM.

Cleary Gottlieb represented SuperMedia in filing a prepackaged chapter 11 proceeding on March 18, 2013 to effectuate its merger with Dex One Corporation, which also filed a prepackaged chapter 11 case on the same day. The prepackaged plans had the overwhelming support of each companies’ secured lenders and stockholders.

The proposed merger was first announced in August 2012, and required certain amendments to SuperMedia and Dex One’s loan agreements. Outside of a court process, these amendments required consent of each lender under the affected loan agreements, but under bankruptcy law, the amendments could be approved with the consent of only one-half of lenders holding two-thirds in amount of the loans under the affected loan agreements. Although SuperMedia did not obtain the consent of every lender, it did obtain acceptance of its prepackaged plan by lenders holding more than 91 percent of the outstanding loans.

Prior to filing the chapter 11 proceeding, SuperMedia also solicited its stockholders for approval of the prepackaged plan. Under the prepackaged plan, stockholders received the same treatment they would receive if the merger had been consummated outside of bankruptcy. Of the SuperMedia stock that voted, over 99 percent voted to accept SuperMedia’s prepackaged plan. SuperMedia stockholders now hold approximately 40 percent of the stock of the combined company, Dex Media, and Dex One stockholders hold the remaining shares.

Dex One’s lenders and stockholders also voted to accept Dex One’s prepackaged plan. Under the prepackaged plans, unsecured creditors of SuperMedia and Dex One are unimpaired and entitled to full payment of their allowed claims.