Stearns and Joint Venture and Preferred Partner Entities to Continue Operating as Normal During Financial Restructuring Process
On July 9, 2019, Stearns Holdings announced that Stearns and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. This process is expected to significantly reduce the Company’s outstanding debt, continue Stearns’ operations and better position the Company for long-term success.
On September 11, 2019, Stearns announced that it reached an agreement with its largest noteholders under which the noteholders will support the Company’s modified Plan of Reorganization. With the noteholders’ support, Blackstone will serve as the plan sponsor and will contribute new capital to Stearns in return for 100% of the ownership of the reorganized company. The Company will seek confirmation of the Plan at a hearing scheduled for October 24, 2019.
Stearns is operating as normal and its employees are focused on providing customers with the high-quality service they expect from the Company. We remain firmly committed to our mission of helping homebuyers find the best loans for their current and future needs.
The joint venture and preferred partner entities to which Stearns is a party are not subject to the Chapter 11 filings and continue to operate in the ordinary course of business. The Company is continuing to pay employee wages and provide health care and other benefits as usual and is paying vendors and suppliers in full under normal terms for goods and services provided on or after the filing date of July 9, 2019.