Intermet Corp. reports it has filed a reorganization plan with the federal court overseeing its Chapter 11 bankruptcy, following a commitment of $75 million in new investment capital with two equity firms, R2 Investments L.D.C. and Stanfield Capital Partners L.L.C. Interment filed for creditor protection last September 29.
The proposed reorganization plan remains subject to various requirements and the approval of the bankruptcy court.
The proposed reorganization plan provides for full payment of administrative claims, tax claims, claims pursuant to Intermet's debtor-in- possession credit agreement, U.S. Trustee fees, consignment claims, and claims of certain secured pre-petition creditors. These claims will be paid throught an exit credit facility that Intermet is negotiating, and a new $75 million equity investment following a successful implementation of the reorganization plan.
Under the plan, unsecured creditors may choose to receive shares of stock in the reorganized Intermet in exchange for their claims, or they may elect to receive cash. Reorganized Intermet will provide 2.5 million shares of common stock to unsecured creditors in exchange for their claims. Unsecured creditors who elect to receive shares of stock in the reorganized Intermet may also purchase up to 7.5 million additional shares of stock through the private rights offering at a price of $10 per share.
To the extent that the full $75 million is not purchased in the private offering, R2 and Stanfield have agreed to purchase the remaining shares of stock.
All pre-petition equity interests of Intermet Corp. will be canceled.
Intermet chairman and CEO Gary Ruff stated: "The commitment letter and the filing of our reorganization plan are major steps for us and represent the start of the final phase of Intermet's operational and financial restructuring. Over the last eight months, we believe much has been accomplished in terms of putting the company back on track in its strategy for long-term growth. We are especially pleased that we also have continued to receive new and replacement business awards in our ferrous, light-metals and European groups during this challenging time."