A.M. Castle and four affiliated Debtors filed for Chapter 11 protection with the U.S. Bankruptcy Court in the District of Delaware, lead case number 17-11330 (Keystone Tube Company). The Company, which operates as a specialty metals and plastics distributor, is represented by Peter J. Keane of Pachulski Stang Ziehl & Jones.
On June 9, 2017, the Company announced that it had achieved the support of an overwhelming majority of its secured creditors by aggregate number and dollar value for its Prepackaged Joint Chapter 11 Plan of Reorganization (dated May 15, 2017), which was filed concurrently with the related Disclosure Statement.
According to the Disclosure Statement, “Through the Plan, the Debtors expect to reduce their ongoing cash interest expense by more than 70% and to create a sustainable capital structure that will uniquely position the Reorganized Debtors for success in the metals industry.”
In addition, “Under the Plan, the Prepetition First Lien Secured Claims will be paid in full through the New ABL Facility or refinanced and exchanged into the New Roll-Up Facility, and the Prepetition Second Lien Secured Claims and the Prepetition Third Lien Secured Claims will be exchanged for a respective share of New Notes and New Common Stock in Reorganized Parent, subject to, among other things, dilution on account of shares of New Common Stock issued upon conversion of the New Notes and shares issued or available for issuance under the Management Incentive Plan….Equity Interests in Parent will be extinguished, but Holders of Equity Interests will be entitled to share in a portion of the New Common Stock as part of a settlement embodied in the Plan if such Holders do not object to the Plan and provide third party releases as part of the Plan.”
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