Global Safety Textiles out of bankruptcy after plan takes effect

By Caroline Salls

Pittsburgh, Jan. 11 - Global Safety Textiles Holdings Inc. emerged from Chapter 11 bankruptcy when its plan of reorganization took effect on Friday, according to a filing with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, under the plan holders of priority lender claims will receive a share of all of the new equity interests in the reorganized company, $70 million of new three-year first-lien notes and $30 million of new three-year lender second-lien notes.

The notes will bear interest at 10% to be paid in kind and 0.25% to be paid in cash, provided, however, that under some circumstances the interest on the first-lien notes will accrue at a rate of Libor plus 600 basis points with a 3% Libor floor.

In addition, holders of priority lender claims who are also debtor-in-possession facility lenders will receive a share of $5 million of new lender three-year first-lien notes. Cash interest on these notes will accrue at a rate of Libor plus 1,000 bps with a 3% Libor floor.

Treatment of creditors will include:

• Holders of administrative claims, tax claims and convenience claims will be paid in full in cash;

• Priority claims will be reinstated;

• Holders of priority lender claims will receive new common stock in the reorganized company and new first-lien and second-lien notes;

• Holders of other secured claims will be paid in full either in cash or through the transfer of the collateral securing the claims; and

• Holders of general unsecured claims and equity interests will receive no distribution.

Global Safety, a subsidiary of Greensboro, N.C.-based textile manufacturer International Textile Group, Inc., filed for bankruptcy on June 30, 2009. Its Chapter 11 case number is 09-12234.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.