NEW YORK — U.S. Bankruptcy Court judge Richard Bohanon on Wednesday approved The Warnaco Group’s disclosure statement, paving the way for the company to begin soliciting votes from creditors on the firm’s reorganization plan.
This story first appeared in the November 14, 2002 issue of WWD. Subscribe Today.
Bohanon, who has been “on loan” to the Manhattan bankruptcy court, gave his OK during a video conference hearing from his home base in Oklahoma City, while attorneys in the case spoke from a courtroom in Manhattan.
Warnaco’s bankruptcy counsel disclosed during the hearing the receipt of an informal letter the firm received by Warnaco from the Department of Justice. The letter, the counsel pointed out, was not a “formal” one and basically asked for clarification of certain items in the reorganization plan. The department’s involvement, the counsel said, arose from customs issues surrounding Warnaco’s importation of goods.
Warnaco will seek $275 million in exit financing, down from the originally planned amount of $325 million. Also, Warnaco amended its disclosure statement to report a bonus that was paid to current chairman and director Stuart Buchalter. The bonus — $210,000 in cash and $140,000 worth of stock in a reorganized Warnaco — was in recognition of both his contribution to the firm’s reorganization and his agreement to continue serving on the board.
Warnaco will begin soliciting votes for its reorganization plan on Nov. 25. A hearing to confirm the plan is set for Jan. 16.