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Katy Industries Interim Disclosure Statement Approved

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The U.S. Bankruptcy Court issued an interim order approving Katy Industries and its official committee of unsecured creditors’ Joint Chapter 11 Combined Plan of Liquidation and related Disclosure Statement.

As previously reported, “This Combined Plan and Disclosure Statement contemplates the appointment of a Plan Administrator who, under the terms of this Combined Plan and Disclosure Statement, shall make Distributions for the benefit of Holders of various Allowed Claims….Section 10 provides general procedures concerning Distributions under the Plan, including the deemed consolidation of the Debtors’ Estates with respect to Allowed General Unsecured Claims. This means that the separate Debtors and Estates will be treated as if they were a single Debtor with a single Estate, so that Claims enforceable against more than one Estate will be treated as a single Claim against the consolidated Estate. Other procedures in Section 10 include: (i) disallowance of post-petition interest, (ii) treatment of undeliverable distributions, (iii) preservation of the Debtors’ setoff rights, and (iv) minimum distribution amounts and disposition of any residual Cash….Section 12 provides a comprehensive proposed settlement regarding Retiree Claims and the termination of the Debtors’ Retiree Life Insurance Plan, which is necessary given that the Debtors have no continuing operations and limited funds available for distribution. Under the Retiree Settlement, (i) the Retiree Life Insurance Plan will terminate, (ii) the Debtors will make a lump-sum payment of $50,000 to the Retirees’ Committee for distribution to the Retirees, (iii) claims, if any, under the Debtors’ self-insured medical plan will have continued to be honored during a 60-day ‘runoff period’ post-termination, and (iv) Retiree Claims will be released and discharged upon the Retirees’ Committee’s receipt of the Retiree Settlement Amount.” The Court subsequently scheduled an April 25, 2018 hearing to consider the Combined DSP, with objections due by April 13, 2018.

Read more Katy Industry bankruptcy news.

The post Katy Industries Interim Disclosure Statement Approved appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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