Ironclad Performance Wear Corp. (ICPW), a maker of high-performance task-specific work gloves, announced Monday that the company and its subsidiary filed for Chapter 11 bankruptcy protection with stalking horse bid from Radians Wareham Holding, Inc.
The company filed the voluntary petitions under Chapter 11 of the U. S. Bankruptcy Code in the U. S. Bankruptcy Court, Central District of California, San Fernando Valley Division on September 8. The Company's Chapter 11 cases are expected to be jointly administered.
During the pendency of the Chapter 11 cases, Ironclad will continue in the possession of its assets and will continue to operate and manage its business in the ordinary course. This includes continuing the development, manufacture and sale of its high-performance task-specific work gloves, pending the sale of substantially all of its assets pursuant to a sale under Section 363 of the Bankruptcy Code.
The company intends to request Bankruptcy Court approval of a series of customary motions related to the payment of various expenses to continue operations.
To facilitate continued business operations, on September 8, Ironclad entered into a Debtor-in-Possession Credit Agreement and Agreement for the Use of Cash Collateral with Radians. Pursuant to this, Radians will provide to Ironclad a secured multiple draw term loan credit facility of up to $1 million for normal business operations, and up to an additional $1 million for additional purchases of inventory.
On September 8, Ironclad also entered into a Stalking Horse Asset Purchase Agreement with Radians pursuant to which Radians will purchase substantially all of Ironclad's assets for an aggregate amount of $20 million, subject to a reduction to $15 million if certain conditions are not met, and the assumption of certain of Ironclad's liabilities.
The closing of the transactions contemplated under the Purchase Agreement is conditioned on approval by the Bankruptcy Court, and consideration by Ironclad and the Bankruptcy Court, of higher or better competing bids for Ironclad's assets at an auction.
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