filed

Under terms of the reorganization announced Monday, Crescent's outstanding secured debt will be reduced by approximately $1 billion, to $465 million. The company also seeks proposals for exit financing between $125 million and $150 million, with proceeds used to refinance outstanding debtor-in-possession borrowings, fund exit costs and provide significant working capital.

"We expect to emerge from bankruptcy early in the second quarter of 2010," says Andrew Hede, Crescent CEO and chief restructuring officer. "The plan will provide for a significantly deleveraged capital structure with greater financial flexibility to execute our business plan and operate the company long term."

Hede adds that Crescent will emerge in a better position to serve its customers and anticipates gradual recovery through mid-2011. "The capital structure contemplated in our plan is correctly sized for current market opportunities," he says. "I am confident we have both the financial flexibility and strategy to succeed."

Under terms of the plan, holders of prepetition secured debt will receive a combination of reinstated debt and 100% of the equity of the reorganized company. In addition, unsecured creditors of the company will receive an interest in a litigation trust to be formed as part of the plan and various project lenders will have their existing debt reinstated.

Crescent is a joint venture between Duke Energy Corp. and Morgan Stanley Real Estate Funds. Its projects include mixed-use developments, single-family neighborhoods, apartment/condominium complexes, class A office buildings, industrial parks and shopping centers.

Instant Insights /

Crescent Resources Files Reorganization Plan

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