According to the U.S. Bankruptcy Court docket, Colt Defense filed a Second Amended Joint Plan of Reorganization and related Disclosure Statement. The Court scheduled a December 16, 2015 confirmation hearing, with objections due by December 9, 2015.
According to the Disclosure Statement, “The Debtors, the other Plan Support Parties, and the Committee 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 Debtors, the other Plan Support Parties, and the Committee, the Plan will allow the Debtors to strengthen their balance sheet by restructuring $250 million of Senior Notes Claims as described more fully herein 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 Plan, if confirmed, would also ensure that the Company continues to operate out of its West Hartford Facility for the foreseeable future and would preserve the jobs of over 700 existing employees….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 Unit. For the avoidance of doubt, Consenting 8.75% Noteholders will participate in the Offering. The aggregate new capital raised through the Offering may be increased by up to $5 million as detailed in the Restructuring Term Sheet regarding the Additional Offering Amount.”
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