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Mirant Corp. could pay an extra $1.15 million in fees to cover the fifth postponement of a hearing for its $2.35 billion exit loan. Judge D. Michael Lynn in U.S. Bankruptcy Court for the Northern District of Texas in Fort Worth late Wednesday granted Mirant an extension on its exit financing until Oct. 2, according to Eric Taube, an Austin, Texas, co-counsel for the official equity committee at Hohmann, Taube & Summer. But the delay will come at a price, he said Thursday. The Atlanta utility, already facing creditor complaints over the loan’s $15 million fee, is expected to pay about $700,000 in attorney fees for continued due diligence on a loan that was initially proposed in May, Taube said. Lenders J.P. Morgan Chase & Co., Deutsche Bank Securities Inc. and Goldman Sachs Credit Partners LLP would also each bill an additional $150,000 for fees to cover the five-week extension, he said. Lynn tabled the issue during Wednesday’s marathon hearing so the special valuation implementation committee could have more time to issue its preliminary report. On June 30, the court ordered Mirant to revise its valuation by immediately tacking on $450,000 to the estate in a move that could give shareholders a rare victory in a bankruptcy petition. The official equity committee and the ad hoc committee of bondholders in bankrupt affiliate Mirant Americas Generation LLC, or MAGI, both objected to the extension while the creditors committee did not. The equity committee and the creditors’ panel have sometimes been at odds in the complex case as they struggle to lock in recoveries for their claims. “We didn’t consent to it, but the court felt that the debtors’ request for the extension was reasonable,” Taube said. The court had targeted a Sept. 30 exit for Mirant that will now apparently be pushed back. Debtor counsel Thomas Lauria in Miami at White & Case didn’t respond to calls on Thursday. Lynn gave the valuation committee until Sept. 13 to file its report, and the court is expected to issue a statement on the matter about a week later, Taube said. The committee was told to revise Mirant’s valuation after a record 27 days of hearings on the value of the bankrupt utility ended on June 29. Mirant is expected to meet continued creditor opposition to the exit financing package whenever it’s heard, owing to the $15 million fee for plan revision as well as other fees. The $2.35 billion loan consists of a $1 billion senior revolver, a $500 million term loan and a bridge component of not less than $850 million. While the commitment letter was filed under seal, certain terms were uncovered in court documents. The $1 billion revolver, which would provide working capital for MAGI and also deal with intercompany transactions, is priced at prime plus between 100 basis points and 125 basis points and matures in six years. The $500 million term loan is priced at prime and between 75 basis points and 100 basis points while the 12-month unsecured bridge loan costs LIBOR plus 450 basis points or prime plus 325 basis points and carries a 0.325 percent, or $3.2 million, commitment fee. The disclosed fees include an underwriting charge of 1.5 percent, or $15 million, on the $1 billion revolver and another 1.5 percent fee, or $7.5 million, if Mirant taps the $500 million term loan. The financing terms also require an additional 1 percent fee on the $850 million bridge loan. The creditors’ committee filed an objection to the loan under seal while the equity panel is objecting because it wants to revise the filed reorganization plan since it only gives them warrants for common stock, Taube said. Only those shareholders that vote to approve would be eligible for the warrants, however. Any revision to the plan would also trigger the $15 million fee. The first plan mandates a combination of cash payouts and the reinstatement of the MAGI long-term notes. Mirant filed for Chapter 11 on July 14, 2003. Besides White & Case, Robin Phelan is Dallas debtor co-counsel at Haynes and Boone. Paul Silverstein represents the creditors in New York at Andrews & Kurth. Edward Weisfelner and Andrew Dash in New York and Howard Siegel in Hartford, Conn., represent the official equity committee at Brown Rudnick Berlack Israels while Taube and Mark Taylor are Austin co-counsel at Hohmann, Taube & Summers. Matthew Cantor and Edward Sassower are New York counsel at Kirkland & Ellis for the ad-hoc bondholders’ committee in MAGI while Jeffrey Hurt and John Lilly are Dallas co-counsel at Hurt & Lilly. Copyright �2005 TDD, LLC. All rights reserved.

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