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Amcast Industrial Corp. has become the latest member of the nation’s smokestack industry to sidestep its pension obligations by transferring them to the federal government. The auto parts maker on Tuesday won court approval of a motion to terminate its pension plans through an oral order from Judge Lawrence S. Walter in the U.S. Bankruptcy Court for the Southern District of Ohio in Dayton. The move leaves the Pension Benefit Guaranty Corp. facing an unsecured claim of $83 million, according to Jean R. Robertson, counsel for the unsecured creditors at McDonald Hopkins Co. in Cleveland. “If [the motion] had not been approved, the debtors would have been obligated to fund over $30 million from 2006 to 2011,” she said. Amcast on Tuesday also won an extension for soliciting the votes of creditors for its first amended reorganization plan until July 31. On March 23, the Dayton court extended Amcast’s exclusivity until April 30, but because a motion to approve another extension was not heard until May 19, a bridge extension was granted until that date. The company filed its reorganization plan on Dec. 16 and filed an amended proposal on May 2. The disclosure statement for the amended plan was filed on April 28. According to the disclosure statement, the unsecureds hold claims of about $43.7 million but are due to only receive an estimated 2 percent recovery after dividing a $1 million cash payment. Amcast is looking for $89 million in exit financing, consisting of a $20 million revolver, a $42 million first priority term loan and a $27 million second priority term loan. Debtor-in-possession lenders, Heritage Bank SSB and Highland Capital Management LP are supposed to provide the exit loan. Much of this money will go to the secured creditors, who hold about $108.3 million in claims and are earmarked for a 65 percent recovery. According to court papers, the revolver and first term loan financing would be priced at LIBOR plus 375 basis points. The second term loan is priced at 12 percent, with 10 percent as pay-in-kind interest and 2 percent paid in cash each quarter. The commitment fee is 1.5 percent, the administrative fee is $6,500 a month and the success fee is 1.5 percent. The fee on the unused portion is the same fee for the revolver times 0.75 percent. The revolver terminates on Oct. 30, 2009; the first term loan on Oct. 30, 2009; and the second term loan on April 30, 2010. Amcast filed for Chapter 11 in the Dayton court on Nov. 30. Alan R. Lepene, Jeremy M. Campana, Jennifer L. Maffett and Lawrence T. Burick at Thompson Hine are debtor counsel. Robertson, Beth E. Hansen and Scott N. Opincar at McDonald Hopkins represent the unsecureds. Copyright �2005 TDD, LLC. All rights reserved.

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