Galey & Lord emerges from Chapter 11

New York, March 5 - Galey & Lord Inc. said it emerged from Chapter 11 on Friday.

The Greensboro, N.C., sportswear fabric manufacturer obtained a $70 million exit facility from General Electric Capital Corp. At emergence, $22 million was drawn on the revolver.

Under Galey & Lord's reorganization plan, holders of its $4.5 million of economic development bonds and $500,000 of leases will see their claims reinstated unimpaired.

Holders of claims under the senior credit facility will share $35 million in cash, the company's $130 million of new term notes and all the common stock of the reorganized company. The new term notes will mature in 5.5 years and pay interest at 10%. The company estimates outstanding claims in this group total $298 million.

General unsecured creditors with claims totaling $15 million will share $500,000 in cash.

Holders of Galey & Lord's $300 million of 9 1/8% senior subordinated notes due 2008 will receive warrants to purchase 3% of the company's common stock. The warrants will run for three years and will have an exercise price that reflects a 100% recovery to senior lenders.

Holders of common and preferred stock will receive nothing.

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