OKLAHOMA CITY, July 8 /PRNewswire-FirstCall/ -- Tronox Incorporated (Pink Sheets: TRXAQ, TRXBQ), on behalf of itself and its affiliated debtors and debtors in possession (collectively, "Tronox") announced today that it has filed a Plan of Reorganization and the accompanying Disclosure Statement with the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court"), where Tronox's Chapter 11 cases are currently pending.
The Plan contains the framework of agreements Tronox is formulating with its principal creditors -- the United States government, several states, its unsecured creditors' committee, various tort claimants and its equity committee -- and is premised upon the transfer of Tronox's legacy environmental and tort liability to certain trusts to be funded upon Tronox's emergence from bankruptcy.
Under the Plan: -- Newly created government trusts responsible for environmental remediation at properties located throughout the United States will be funded with a package of consideration that includes (i) up to $145 million in cash, (ii) 88% of Tronox's interest in pending litigation against Anadarko Petroleum Corporation and Kerr-McGee Corporation (the "Anadarko Litigation"), (iii) preferred stock and warrants convertible to common equity of Reorganized Tronox, allowing the trusts to share the benefit of improvements in Tronox's enterprise value, and (iv) certain other real property, insurance and financial assurance assets. -- Tort claims will be satisfied through separate trusts funded with 12% of the Anadarko Litigation proceeds, $7 million in cash and certain insurance assets. If tort claimants vote to reject the Plan, they will share in the general unsecured pool and Tronox will retain 12% of the Anadarko Litigation and the $7 million in cash. -- General Unsecured Claims (including claims held by the company's prepetition noteholders) are slated to receive all of the primary common equity of Reorganized Tronox. Tronox expects general unsecured creditors will recover between 80 and 100% of their claims based on plan valuation. -- Existing equity holders will recover warrants to purchase up to 5% of the common equity (subject to certain terms and conditions) if they vote to accept the Plan.
"The filing of the Plan is a key milestone for Tronox as it focuses on emerging from Chapter 11. We believe the plan contains the elements necessary to achieve a consensual settlement of our environmental and other legacy liabilities," said Tronox Chairman and Chief Executive Officer Dennis Wanlass. "Importantly, the Plan would enable Tronox to emerge from Chapter 11 as a going concern, responsibly capitalized and well positioned to ensure its long-term viability for the benefit of all stakeholders -- including the environmental trusts and agencies responsible for serving the public interest."
Wanlass stated: "We are pleased to be able to propose a fair and comprehensive package to the government while still achieving substantial recoveries for all of our other creditor groups. While there is much work ahead, the end of this complex bankruptcy is in sight and we will continue to work closely with our stakeholders in an effort to garner their support for the plan before voting begins. We thank our customers, suppliers, business partners and employees for their ongoing commitment to the company through this process, which has helped us to build a stronger Tronox."
The hearing to consider approval of the Disclosure Statement that explains Tronox's plan is scheduled for August 5, 2010.
Copies of the Plan and Disclosure Statement can be found under the "Reorganization" section of Tronox's website at http://www.tronox.com/. The Plan is subject to receiving the requisite votes from stakeholders, receiving approval from the Bankruptcy Court and satisfying closing conditions. The Plan is subject to change.
About Tronox
Tronox commenced its Chapter 11 cases on January 12, 2009. Tronox is among the world's leading producers of titanium dioxide pigment and other specialty chemicals used in the manufacture of products, such as paints, plastics, and paper and battery applications. Tronox has approximately 1,100 customers located in more than 90 countries. For more information, visit http://www.tronox.com/.
Forward-Looking Statements: Some information in this news release regarding the company's or management's intentions, beliefs or expectations, or that otherwise speak to future events, including the terms of the Plan, are "forward-looking statements" within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include those statements preceded by, followed by or that otherwise include the words "believes," "will," "expects," "anticipates," "intends," "estimates," "projects," "target," "budget," "goal," "plans," "objective," "outlook," "should," or similar words. Future results and developments discussed in these statements may be affected by numerous factors and risks, such as the accuracy of the assumptions that underlie the statements, the approval of the Plan by the Bankruptcy Court and requisite stakeholders, the satisfaction of closing conditions, the market value of Tronox's products, demand for consumer products for which Tronox's businesses supply raw materials, the market for debt and/or equity financing, changes in laws and regulations, the ability to respond to challenges in international markets, changes in currency exchange rates, political or economic conditions in areas where Tronox operates, trade and regulatory matters, general economic conditions, and other factors and risks identified in the Risk Factors Section of Tronox's Annual Report on Form 10-K for the year ended December 31, 2007, and subsequent Quarterly Reports on Form 10-Q, as filed with the U.S. Securities and Exchange Commission (SEC), and other SEC filings. Actual results and developments may differ materially from those expressed or implied in this news release. The company does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made. Investors are urged to consider closely the disclosures and risk factors in Tronox's Annual Report on Form 10-K for the year ended December 31, 2007, available on Tronox's website, http://www.tronox.com/. This also can be obtained from the SEC by calling 1-800-SEC-0330.
Media Contact: Robert Gibney Direct: 405-775-5105 Email: robert.gibney@tronox.com
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Tronox Incorporated
CONTACT: Robert Gibney of Tronox, +1-405-775-5105,
robert.gibney@tronox.com
Web Site: http://www.tronox.com/
