The Agent Alliance, a buying group of 17 telecom agencies, said it has been named to the creditors committee in the Chapter 11 bankruptcy proceeding for Trans National Communications International Inc., a privately held reseller and VoIP carrier based in Boston.
The service provider filed Oct. 9 for protection under Chapter 11 of the U.S. bankruptcy code. The creditor’s committee, which was named Oct. 20, also includes Sprint and Verizon.
According to the U.S. government website for the federal judiciary, a creditors committee is appointed by the U.S. Trustee and usually consists of unsecured creditors who hold the largest claims against the debtor. Among other things, the committee consults with the debtor in possession on administration of the case, investigates the debtors conduct and operation of the business, and participates in formulating a plan. A creditors committee may, with the courts approval, hire an attorney or other professionals to assist in the performance of the committees duties. A creditors committee can be an important safeguard to the proper management of the business by the debtor in possession.
In its filing, TNCI reported more than $13 million owed to its top 20 unsecured creditors, which primarily are the resellers underlying network providers, including Sprint, AT&T Qwest/CenturyLink and Verizon as well as numerous CLECs, including PAETEC, One Communications (now part of EarthLink Business), XO Communications and Covad (now MegaPath).
Unlike the other creditors’ committee members, the Agent Alliance was not listed in the filing as being among the top 20 creditors. However, the Agent Alliance has a joint contract with TNCI and has banked heavily on the success of TNCI, creating an equity program for the alliance and other telecom agents in June 2008.
TNCI Spokesperson Jeanne Duca told Channel Partners earlier this month that the equity program itself is not impacted by the Chapter 11 reorganization. Agents that have earned equity will retain that percentage. As to the value of that equity, Duca said once TNCI emerges from bankruptcy a healthier company, the value may not take the expected hit. It will, however, necessarily delay to time to transaction, she said. The original plan was for the company to be sold in 2011.
TNCI has said it will continue to serve its customers and pay its telecom agents uninterrupted through the bankruptcy process. An automatic stay provision provided in a Chapter 11 filing prohibits TNCI’s underlying carriers from making changes to customers current services, contract terms, or rates during this period.
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May 17 2019 @ 15:34:37 UTC