Former Point Blank inks payment deal with remaining DIP loan lenders

By Caroline Salls

Pittsburgh, Aug. 17 - SS Body Armor I, Inc., formerly Point Blank Solutions Inc., requested court approval of a settlement reached with its remaining debtor-in-possession financing lenders, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

The remaining DIP financing lenders include Privet Opportunity Fund I LLC and Privet Fund LP, as well as Prescott Group Capital Management, LLC.

SS Body Armor said the settlement globally resolves the motion of its official committee of equity security holders to vacate the company's interim and final financing orders.

Under the settlement:

• The company will pay the remaining amounts owed to the remaining DIP lender parties under the DIP financing agreements and plan support agreements, provided that the remaining lender parties waive their right to payment of unpaid default interest and their share of a breakup fee payable under the plan support agreement;

• The equity security interests held by the remaining DIP lender parties will be allowed equity interests for all purposes in the SS Body Armor bankruptcy cases and will not be subject to disallowance, recharacterization or objection;

• The equity committee will withdraw its motion with prejudice; and

• Upon receipt of settlement agreement payments, the remaining DIP lender parties will be deemed to have received full payment of senior obligations, and the DIP protections granted to the remaining lenders will be automatically terminated and released.

However, the remaining lenders' rights to indemnification under the DIP credit agreement will be deemed reinstated in case a claim is threatened or filed against the lender parties.

A hearing is scheduled for Sept. 6.

Point Blank is a Pompano Beach, Fla., producer of body armor systems for law enforcement and the military. The company filed for bankruptcy on April 14, 2010. Its Chapter 11 case number is 10-11255.

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