Motor Coach Industries Emerges from Chapter 11

Company Completes Restructuring in Seven Months, Secures $230 Million in Exit Financing

SCHAUMBURG, ILL--()--Motor Coach Industries (“MCI” or “the Company”) announced that on Friday, April 17, the Company emerged from its voluntary Chapter 11 reorganization. The United States Bankruptcy Court for the District of Delaware confirmed the Second Amended Joint Plan of Reorganization for MCI and certain of its affiliated companies on January 28, 2009.

“The completion of our financial restructuring is a major milestone in the 76-year history of MCI,” said Tom Sorrells, President and CEO. “I am particularly pleased that, given a very challenging economic backdrop and the tight credit markets, we were able to complete the process in just seven months. This is a testament to the strong reputation and presence of our Company in the industry and the unyielding commitment of Franklin Mutual Advisers, LLC, our new majority shareholder, through the final negotiations.”

“This achievement also reflects the dedication of all MCI employees who continued their focus on delivering quality coaches and customer service during this period. We are also extremely appreciative of the outstanding support we received from our lenders and legal and financial advisors in this process,” said Sorrells. “Finally, I want to especially recognize MCI’s customers and suppliers, whose loyalty and support throughout were critical components of this successful result. We look forward to building on our reputation for innovation and continuing as the leader in the motor coach industry.”

Certain investment funds managed by Franklin Mutual Advisers, LLC (collectively “FMA”), a recognized and established global investment management firm, have become the Company’s majority shareholders through the conversion of third lien secured debt into common stock and the issuance of $200 million in new preferred stock. In conjunction with its emergence from Chapter 11, MCI has obtained $230 million of exit financing and consummated its pre-negotiated plan. GE Capital is the arranger and lead lender under a $75 million senior secured revolving credit facility. The Company has also arranged for a $155 million second lien term loan from a group of lenders.

“The decision to further invest in MCI and its future is based on a recognition and respect of its leading position in the strategic transportation sector and its commitment to building customer relationships, providing consistent quality and innovation, and working with integrity, all values we share,” said Shawn Tumulty, Vice President and Portfolio Manager for FMA. “We are familiar with MCI and its operations as an investor over the last five years and look forward to the opportunity to work with MCI’s executive leadership in developing a renewed strategy for growth and success.”

“We have secured a strong new financing package, the terms of which were improved as a result of FMA agreeing to enhance the Company’s post-emergence capital structure,” added Mr. Sorrells. “With a strengthened financial base, we are well positioned to take greater advantage of market opportunities and further grow our business.”

The Company was advised by Rothschild Inc., AlixPartners LLP and Simpson Thacher & Bartlett LLP. FMA was advised by Sills Cummis & Gross P.C. and Houlihan Lokey Howard & Zukin Capital, Inc.

Franklin Mutual Advisers, LLC, is a subsidiary of Franklin Resources, Inc. (NYSE: BEN), a global investment management organization based in San Mateo, CA, with over $391 billion in assets under management as of March 31, 2009.

Motor Coach Industries, headquartered in Schaumburg, Illinois, is the leading manufacturer of intercity coaches for the tour, charter, line-haul, scheduled service, and commuter transit sectors in the U.S. and Canada. The Company also operates seven sales centers and eight service centers in the U.S. and Canada and is the industry's leading supplier of aftermarket parts for most makes and models.

Contacts

MWW Group:
Mr. Rich Tauberman, 202-585-2282
rtauberman@mww.com
or
Ms. Susan Kenney, 201-964-2392
skenney@mww.com

Contacts

MWW Group:
Mr. Rich Tauberman, 202-585-2282
rtauberman@mww.com
or
Ms. Susan Kenney, 201-964-2392
skenney@mww.com