New Delaware Chapter 11 Filings – American Gilsonite Holding Company

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American Gilsonite Holding Company—a hydrocarbon resin supplier based in Houston, Texas—and four of its affiliates have filed petitions for relief under chapter 11 in the United States Bankruptcy Court for the District of Delaware (Case No. 16-12315).   The Debtors enter chapter 11 with a prepacked plan of reorganization and $30 million in proposed debtor in possession financing provided by an ad hoc group of the Debtors’ second lien noteholders.  According to the First Day Declaration, the Plan will convert $270 million in Second Lien Notes into 98% of the equity in the reorganized Gilsonite and $100 million in subordinated notes, while providing current equity holders with the remaining 2% of equity.  General unsecured claims will be paid in the ordinary course and be unimpaired under the Plan.  The Debtors’ disclosure statement can be found hereWeil, Gotshal & Manges LLP is proposed counsel to the Debtors and Epiq Bankruptcy Solutions, LLC is the proposed claims agent.  The cases have been assigned to the Honorable Christopher S. Sontchi.

Contact Norman L. Pernick and  Nicholas J. Brannick for more information.

As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.

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