TLC Vision Corp., a Canadian eye care services company, said Monday it has filed for Chapter 11 protection in a U.S. court and has a rough draft of a reorganization plan worked out with senior creditors.
The plan calls for certain creditors to be given all the equity of the reorganized company in exchange for debt. TLC would emerge as a private company.
TLC runs treatment centers for patients with myopia, astigmatism and cataracts as well as offices that perform laser eye surgery. TLC said that besides its U.S. Chapter 11 filing in Delaware, it has filed for bankruptcy protection in Canada.
The company said it has an agreement with creditors who hold a majority of its senior secured debt to swap debt for all the equity in the reorganized company. It would also restructure its balance sheet and honor obligations to employees, vendors and certain other creditors, under the proposed plan. Since the plan would wipe out the old stock, shareholders would have "no assurance" or any recovery, the company said.
TLC said it also has a deal to sell six refractive centers in Canada. It plans to continue to operate centers under the TLC Canada name.