Bankruptcy News

We've summarized the latest docket activity and news for publicly traded companies currently operating under U.S. Bankruptcy Court protection.

Bankruptcy/Chapter 11

Colt Defense Plan Filed

Colt Defense filed with the U.S. Bankruptcy Court a Joint Chapter 11 Plan of Reorganization and related Disclosure Statement. According to the Disclosure Statement, "The Plan Support Parties believe that absent a consensual resolution of their complex Claims, these bankruptcy cases would require extensive and potentially prohibitively expensive litigation to the detriment of the Debtors' estates, creditors, and all parties in interest. Through the settlement of these Claims and all other disputed issues among the Plan Support Parties, the Plan will allow the Debtors to strengthen their balance sheet by converting $250 million of Senior Notes Claims into equity and will allow the Debtors to avoid the incurrence of significant litigation costs and delays and exit bankruptcy with the liquidity necessary to execute their business plan....The Debtors will raise $50 million in new capital from the private Offering of Offering Units consisting of (i) third lien secured debt to be issued pursuant to a third lien exit facility and (ii) 100% of the New Class A LLC Units (subject to dilution by New Class A LLC Units granted under the New Management Incentive Plan and by New Class A LLC Units issued to NPA in accordance with the West Hartford Facility Term Sheet and the Restructuring Term Sheet)….On or after the Effective Date, the New Board will adopt the New Management Incentive Plan, which will provide for grants of equity-based compensation of up to 10% of the New Class A LLC Units in Reorganized Parent to members of the Reorganized Debtors' management team, including New Class A LLC Units which will dilute the New Class A LLC Units issued in the Offering and the New Class B LLC Units as described in the Restructuring Term Sheet."

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