According to the U.S. Bankruptcy Court docket, Allen Systems Group and two affiliated Debtors filed for Chapter 11 protection in the District of Delaware, lead case number 15-10332. The Company, which provides information technology management software solutions, is represented by Laura Davis Jones of Pachulski Stang Ziehl & Jones. Allen Systems Group concurrently filed a Joint Prepackaged Plan of Reorganization and related Disclosure Statement, both dated February 9, 2015.
The Disclosure Statement explains, “The Plan provides for the discharge of Claims and Interests through: (a) the issuance of the New Common Stock; (b) the consummation of the Rights Offering; (c) entry in to the Exit Facilities; and the (d) payment of Cash. As more fully described herein: (a) holders of Secured Tax Claims will be paid in full in cash; (b) holders of Other Secured Claims will be reinstated or receive collateral; (c) holders of Other Priority Claims will be paid in full in cash; (d) holders of Domestic Credit Facility Claims will be paid in full in cash, unless the holders of two thirds (2/3rds) in amount of the Domestic Credit Facility Claims agree to less favorable treatment, including the terms of such less favorable treatment, in which case such less favorable treatment shall be binding on all holders of Domestic Credit Facility Claims; (e) holders of Notes Claims will receive their Pro Rata share of (A) Notes Claims Stock and (B) if such holder is an Eligible Holder of Notes Claims, Subscription Rights to subscribe for a Pro Rata share of Rights Offering Stock for an aggregate purchase price equal to the Subscription Payment Amount; (f) holders of Allowed Other Unsecured Claims will be paid in full in Cash; provided, however, that, for the avoidance of doubt, the Notes Deficiency Claims and the Allen Claims do not constitute Other Unsecured Claims and shall not be entitled to any distribution provided to the holders of Allowed Class 6 Claims; (g) holders of ASG Interests will have their interests canceled; (h) holders of Intercompany Claims will be left unaltered; (i) holders of Intercompany Interests will be left unaltered; and (j) holders of Section 510(b) Claims will have their interests canceled.”
Allen Systems Group explains, “The Company’s declining financial performance in 2014 accelerated as information about its financial distress spread into the marketplace and customers grew increasingly concerned about the Company’s long-term viability. The Company believes that the consummation of the Plan will stabilize the Company and mitigate this obstacle to revenue generation.” Learn more about Allen Systems Group’s bankruptcy bonds.