United Road Towing, Inc. Undertakes Chapter 11 ReorganizationFeb 8th, 2017 | By Editorial Staff | Category: Spotlight
United Road Towing, Inc. Press Release:
MOKENA, Ill., February 6, 2017 – United Road Towing, Inc. (the “Company”) today announced that it has commenced a process to restructure its balance sheet and position the Company for the future. To facilitate this restructuring, the Company, URT Holdings, Inc. and certain of their subsidiaries have filed voluntary petitions for reorganization under chapter 11 of the U.S. Bankruptcy Code in the Bankruptcy Court for the District of Delaware.
The Company was profitable in 2016, as has been the case in prior years, but the overall debt burden plus certain potential liabilities created by an unfavorable court ruling lead the Company to choose the best course of action to secure the continued strength in its financial position. “Our decision to initiate a court-supervised restructuring was a difficult but important step to address our immediate liquidity issues and best position the Company for the future,” said Jerry Corcoran the Company’s CEO. “The court process will allow us to reduce our debt, providing the opportunity to support the business going forward while focusing on our core strengths. As a result of this process, we expect that the Company will be in an even better position over the long term to utilize our capabilities in service of our customers, vendors, and employees.”The Company has secured commitments for new capital in debtor-in-possession (DIP) financing. Subject to Court approval, these financial resources will be made available to the Company to support its continuing business operations, minimize disruption to its worldwide projects and partnerships, and make necessary operational changes.
The new financing will support day-to-day operations during the reorganization, including:
- Paying wages and benefits for employees;
- Continuing to provide services to customers;
- Paying vendors, continuing landlords and suppliers in the ordinary course for goods and services provided on or after the date of the chapter 11 filing;
- Proceeding with work on ongoing projects and maintenance; and
- Complying with all regulatory obligations.
The Company has made customary filings, including first day motions, with the Court, which, if granted, will help ensure a smooth transition into chapter 11 without business disruption. The motions are expected to be addressed by the Court promptly following the filing, and include, among other things, a request for approval of the debtor-in-possession financing, as well as requests for authority to make wage and salary payments, continue various benefits for employees, and other relief in order to continue the day-to-day operations of the Company.
The company has been engaged in a process with the intention to emerge from bankruptcy in approximately two months’ time.
Additional information on the restructuring, and the claim process, can be found at
http://omnimgt.com/UnitedRoadTowing. The Company has hired Winston & Strawn LLP, Young Conaway Stargatt & Taylor, LLP, Getzler Henrich & Associates LLC, and SSG Capital Advisors, LLC as advisors in connection with the Company’s restructuring.
United Road Towing, Inc., headquartered in Mokena, Illinois, conducts towing, recovery, impound,and vehicle management in both the private and public sector. Through a portfolio of local and regional brands operating across 10 different regions in eight different states, the company dispatches approximately 500,000 tows, manages over 200,000 impounds and sells or disposes of over 38,000 vehicles annually across the United States.