Baking & Snack - November 2007 - 10

NEWS FRONT
IBC files motion for exit funds
Interstate Bakeries Corp., Kansas City, MO, moved forward in its
bankruptcy actions. The company filed a motion with the US Bankruptcy Court requesting authorization to enter into an agreement
with Silver Point Finance LLC to provide the company with up to
$400 million in exit financing upon emergence from Chapter 11.
The company is also seeking permission from the court to enter into
a funding agreement with JP Morgan Chase Bank, NA; McDonnell
Investment Management LLC; Quadrangle Master Fund Ltd.; and
Silver Point Capital LC (the plan supporters). The groups account
for approximately 48% of the funded amounts outstanding under
IBC's prepetition senior credit facility.
According to IBC, the plan supporters agreed to convert
approximately $218 million of funded prepetition senior secured
debt into new debt and equity securities to be issued upon the
company's emergence from Chapter 11. Both the Plan Funding Agreement and exit financing commitment are subject to
customary conditions, including that the company obtain agreement to and ratification of changes to its collective bargaining
agreements with major unions, , and the company obtain as
extension of its debtor-in-place financing facility scheduled to
mature on Feb. 9, 2008.
In late October, the Teamsters submitted a letter with nearly

4,000 Teamster IBC worker signatures to the IBC board of directors calling IBC's c.e.o. Craig Jung's management decisions
"misguided and dangerous."
"Silver Point's $400 million capital commitment to our company
sets the foundation for achieving a rational capital structure to support the company's business plan and allow IBC to emerge from
Chapter 11 with sufficient liquidity to compete in the marketplace,"
Mr. Jung said. "But we have very little time to reach a mutually
acceptable agreement with the Teamsters in order to save our
company and our jobs. Now is clearly the time for Teamsters' union
leadership to recognize that the livelihood of 25,000 families rests
squarely on their shoulders."
If the company receives authorization from the court to enter into
the financing agreements with Silver Point, it will be obligated to pay
at least $5 million in commitments fees for the exit facility commitment and up to $12 million in potential breakup fees if, among other
reasons, the company is not able to obtain the union agreements
necessary to implement its business plan.
"We believe that IBC has the business plan, leadership, skilled
work force and resources to emerge from Chapter 11 as a powerful
competitor in the baked goods industry able to achieve sustainable
profitability," Mr. Jung said.

ᮡ Caravan Ingredients helped promote World Bread Day with this sign posted
outside its Lenexa, KS, headquarters.

KSU narrows department
head search
The Department of Grain Science and Industry at Kansas State University, Manhattan, KS, recently completed the review process of applications received for the position of department head. The search
was narrowed to three candidates: Pavinee Chinachoti, Ph.D., product
science fellow, R&D, Hill's Pet Nutrition, Inc., Topeka, KS; Jon Faubion, Ph.D., professor, Department of Grain Science and Industry, KSU;
and Dirk E. Maier, Ph.D., associate head, Agricultural and Biological
Engineering Department, Purdue University, West Lafayette, IN.
The three candidates will now begin the interview process.

12 / BAKING & SNACK / November 2007

ᮡ Tim Cook, vice-president of sales and marketing, AMF Bakery Systems, is the first
baking industry allied member in recent history to chair PMMI's Pack Expo show
committee. The 2-year term includes both the recent Pack Expo Las Vegas and next
year's Pack Expo International at Chicago, IL. Mr. Cook noted that 15 to 20% of AMF
sales are outside the baking industry in secondary packaging and robotics.

Baking & Snack - November 2007

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