Here’s the restructure plan:
https://storage.courtlistener.com/recap/gov.uscourts.orb.528157/gov.uscourts.orb.528157.113.0.pdf
These are the highlights that I copied from a post over on VAF:
- Existing equity gets wiped out (including the ESOP which is being terminated).
- The Van Grunsvan loans totaling $7m will be converted to equity (i.e. Van will be the sole shareholder).
- Customers who made "priority" claims for their customer deposits get paid $3350 on the effective date of the plan (i.e. when approved by the court).
- The remainder of deposits are grouped as unsecured creditors class and will get an "impaired" $0.55 on the dollar paid over three years -- a total of $2.7m or 80% of net disposable income through 2027. It's different amounts allocated for payments over the three years, so the payments would be uneven: $860,000 on or before june 15, 2025, plus $570,000 on or before June 15, 2026, plus $1,320,000 on or before June 15, 2027. However, they can be prepaid by the company at any time, say, if its disposable income is more than projected at this time. The projections are relatively steady for $69m to $73m in revenue in the next three years.
- The company is allocating 20% of net income annually "reinvested in business operations" to hire additional staff, purchase more manufacturing equipment, and upgrade software.
- Anybody with a "small" unsecured claim under $1000 will be paid 100% within 60 days from the effective date. If your claim is greater than $1000, you can elect to reduce your claim to $1000 in order to be treated as a "small" unsecured claim.
- The company can object to claims up to 60 days after the effective date.
- All replacements for LCP are expected to be shipped by November 2024.
- 82% of customers with deposits elected to sign new contracts.
I don’t know anything about bankruptcy so I don’t totally understand what all of this means but it would appear to me that Vans is going to survive but at the cost of creditor losses.