The law firm of Vedder Price represented the Board of Directors of Tronox Inc. (OTC: TRXAQ, TRXBQ) in connection with a reorganization plan that secures new funding and settles its environmental liabilities. The plan will grant certain bond holders a 70% stake in the reorganized company in exchange for an equity infusion of $105 million.
Under the plan, all government claims relating to Tronox’s legacy environmental sites will be settled through creation of a remediation trust and a litigation trust. Tronox will contribute $115 million in cash and 88% of its interest in litigation against Anadarko Petroleum Corp. and Kerr-McGee Corp. The remaining 12% of the Anadarko/Kerr-McGee litigation will go to other claimholders.
Tronox has entered into a credit agreement for a new $425 million debtor-in-possession financing facility which repaid the company’s outstanding secured debt, including the current debtor-in-possession financing.
Headquartered in Oklahoma City, Tronox is the world’s fourth largest producer and marketer of titanium dioxide pigment, with an annual production capacity of 535,000 tons. Titanium dioxide pigment is an inorganic white pigment used in paint, coatings, plastics, paper and many other everyday products. The company’s four pigment plants, which are located in the United States, Australia and the Netherlands, supply high performance products to approximately 1,100 customers in over 100 countries. In addition, Tronox produces electrolytic products, including sodium chlorate, electrolytic manganese dioxide, boron trichloride, elemental boron and lithium manganese oxide.
Guy E. Snyder, a Shareholder in Vedder Price’s Finance and Transactions group, led the firm’s team on the transaction. David L. Doyle, Chair of the firm’s Commercial Litigation group, also advised the Board on various litigation risk assessment matters.