In connection with the bankruptcy of the Issuer as described in the Issuer’s current report on Form 8-K, dated as of April 29, 2010 and filed on May 4, 2010 (the “Issuer’s Form 8-K”), and pursuant to the Debtors’ Modified Fourth Amended Joint Plan of Reorganization under Chapter 11 of the Bankruptcy Code, as confirmed by the Bankruptcy Court on April 29, 2010 (the “Plan”), as of April 30, 2010 (the “Effective Date”), the Reporting Persons (a) received 114,912 shares of Common Stock pursuant to the conversion of SFI Unsecured Claims (as defined in the Plan); (b) received 144,152 shares of Common Stock at no cost pursuant to the Delayed Draw Equity Purchase (as defined in the Plan) and (c) purchased 1,720,992 shares of Common Stock for a purchase price of $29.4204 per share and 351,670 shares of Common Stock for a purchase price of $22.065 per share, for an aggregate purchase price of approximately $58.391 million from working capital of the Reporting Persons. |
On June 13, 2009, the Issuer, its domestic subsidiaries and certain of the Issuer’s affiliates (collectively, the “Debtors”) filed voluntary petitions in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) for relief under Chapter 11 of the Bankruptcy Code. On April 1, 2010, the Debtors filed with the Bankruptcy Court the Plan of Reorganization, as subsequently modified. On April 30, 2010, the Bankruptcy Court entered an order confirming the Plan. On the Effective Date, the Debtors consummated their reorganization through a series of transactions contemplated by the Plan and the Plan became effective pursuant to its terms. Upon emergence from Chapter 11 on the Effective Date, all outstanding shares of the Issuer’s Common Stock and other equity interests in the Issuer were cancelled, as well as certain debt securities. As described above, pursuant to the terms of the Plan and in settlement of its claims against the Debtors, the Reporting Persons received 114,912 shares of Common Stock pursuant to the conversion of the SFI Unsecured Claims. The Plan provides, among other things, that, as of the Effective Date, a (i) new certificate of incorporation and bylaws of the Issuer be in effect, (ii) the name of the Issuer’s corporation name change to Six Flags Entertainment Corporation, and (iii) new members of the board of directors be established, including Daniel C. Murphy, an employee of Pentwater Capital, who was selected by a creditors’ committee, of which Pentwater Capital was party. Pursuant to the Plan, on the Effective Date, the Issuer entered into a registration rights agreement (the “Registration Rights Agreement”) with each stockholder who, as of the Effective Date, held (together with its affiliates) at least 1% of the Common Stock, including the Reporting Persons. Pursuant to the Registration Rights Agreement, the Issuer agreed to register the resale of the shares of Common Stock issued to such holders in accordance with the requirements of the Securities Exchange Act of 1933, as amended (the “Securities Act”) (including, within 30 days following the Effective Date, pursuant to a resale shelf registration statement pursuant to Rule 415 promulgated under the Securities Act). The Registration Rights Agreement provides that, at any time from and after the Effective Date, holders party thereto collectively owning at least 20% of the then outstanding shares of Common Stock (and securities convertible into Common Stock) have the right to require the Issuer to effect certain underwritten registered offerings of such holders’ Common Stock (and convertible securities), including Common Stock acquired pursuant to the Plan or the Offering (as defined in the Plan), on the terms and conditions set forth in the Registration Rights Agreement. Holders of the Common Stock entitled to demand such registrations are entitled to request an aggregate of five (5) underwritten offerings (which, individually, must include an amount of Common Stock to be registered and/or sold by such holders in excess of $100 million). In addition, holders party to the Registration Rights Agreement are entitled to request an unlimited number of piggyback registrations. The above summary of the material terms of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the Registration Rights Agreement, a copy of which is included as Exhibit 4.1 to the Issuer’s Form 8-K, and is incorporated by reference herein. In consideration for the Reporting Persons commitment to enter in a Backstop Commitment Agreement (as defined in the Plan), the Reporting Persons received 144,152 shares of Common Stock at no cost pursuant to the Delayed Draw Equity Purchase. Pursuant to the Plan, on the Effective Date, the Reporting Persons entered into the Backstop Commitment Agreement (as defined in the Plan), whereby the Reporting Persons have agreed, pursuant to the terms and conditions set forth in the Backstop Commitment Agreement, to purchase an additional $25 million of shares of Common Stock on or before June 1, 2011 following approval by a majority of the members of the Issuer’s board of directors. The above summary of the material terms of the Backstop Commitment Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the Backstop Commitment Agreement, a copy of which is included as an Exhibit to the Issuer’s Form 8-K, filed with the Securities and Exchange Commission on May 11, 2010, and is incorporated by reference herein. The Reporting Persons expect to evaluate on an ongoing basis the Issuer’s financial condition and prospects and its interest in, and intentions with respect to, the Issuer and their investment in the securities of the Issuer, which review may be based on various factors, including whether various strategic transactions have occurred or may occur, the Issuer’s business and financial condition, results of operations and prospects, general economic and industry conditions, the securities markets in general and those for the Issuer’s securities in particular, as well as other developments and other investment opportunities. Accordingly, each Reporting Person reserves the right to change its intentions and develop plans or proposals at any time, as it deems appropriate. In particular, each Reporting Person may at any time and from time to time, in the open market, in privately negotiated transactions or otherwise, acquire additional securities of the Issuer, including additional Common Stock; |
