Luna Innovations Chapter 11 plan proposes to pay all creditors in full

By Caroline Salls

Pittsburgh, July 20 - Luna Innovations Inc. filed its plan of reorganization and disclosure statement Friday with the U.S. Bankruptcy Court for the Western District of Virginia.

As previously reported, if Luna's request to estimate Hansen Medical, Inc.'s litigation claim at $1.3 million is granted, the company believes creditors would recover 100% of their claims and existing shareholders would be left in place.

Creditor treatment will include:

• Holders of administrative claims, priority tax claims and professional fee claims will recover 100% in cash;

• Holders of miscellaneous secured claims will recover 100% either in cash or through reinstatement or the claim or the return of the property securing the claim;

• Holders of Carilion claims will have their notes reinstated and recover 100% of their claims in cash;

• Holders of unsecured claims and litigation claims will recover 100% in cash plus interest accruing from the bankruptcy filing date through the distribution date; and

• Interests will be reinstated and holders will retain their rights to the interests.

Luna, a Roanoke, Va.-based company involved in research, development and commercialization of innovative technologies in molecular technology solutions and sensing solutions, filed for bankruptcy on July 17. Its Chapter 11 case number is 09-71811.

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