Fleming Reorganization Plan to Take Effect Next Month

DALLAS - Fleming Cos.' third amended plan of reorganization, confirmed earlier this week by the U.S. Bankruptcy Court in Wilmington, Del., is scheduled to become effective in mid-August.

The plan provides for the reorganization of the debtors, centered on the Fleming convenience store distribution operations, through the formation of a new entity known as Core-Mark Holding Co., Inc. Unsecured creditors will receive the majority of the common stock of Core-Mark. Financing commitments from General Electric Capital Corp. for a $240 million revolving credit facility and a $10 million term loan have been provided. Sankaty Advisors, LLC has provided a commitment for an additional $70 million term loan facility. Also, Fleming's remaining assets and liabilities not related to the convenience operations will be transferred to either a post-confirmation trust, which will have the responsibility for liquidating such assets and liabilities, pursuing causes of action, and reconciling and paying claims, or a reclamation creditors' trust, which will have similar responsibilities and rights with respect to reclamation creditors.

San Francisco-based Core-Mark distributes products to convenience stores and other retailers from 22 distribution centers. Core-Mark's distribution centers service customers in 38 states and five Canadian provinces.

In a statement, Mike Walsh, Core-Mark's president and c.e.o., said: "We are pleased to emerge from bankruptcy as an independent company with a loyal customer base and a strong balance sheet. We look forward to working with our new board of directors and owners to drive our business forward."

Archie Dykes, c.e.o. of Fleming, said in the same statement: "We appreciate the strong support for our plan of reorganization by creditors and lenders. They have been cooperative and constructive partners throughout Fleming's reorganization process. We are also grateful to our vendors, customers, and associates for their continued support during this challenging time, and we greatly appreciate the time and attention Judge Walrath and the bankruptcy court, clerks, and staff have given to this case."

According to published accounts, an SEC probe into Fleming's accounting practices is still under way, while a securities class action against Fleming's former officers, directors, and auditors has been on hold for the duration the company's bankruptcy.
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