Special Devices obtains court approval of plan of reorganization

By Jennifer Lanning Drey

Portland, Ore., July 24 - Special Devices, Inc. received court approval of its plan of reorganization Friday from the U.S. Bankruptcy Court for the District of Delaware, according to a source familiar with the case.

As previously reported, under the plan, holders of senior subordinated note claims and general unsecured claims will have the option to receive either new common stock or cash in exchange for their notes.

The company will obtain at least $31.5 million in exit financing, consisting of $10 million to $15 million in new secured notes and $16.5 million to $21.5 million in new preferred stock.

Treatment of creditors under the plan will include:

• Holders of secured claims will recover 100% either in cash or the return of the collateral securing the claim;

• Holders of senior subordinated note claims and general unsecured claims will recover up to 7.5% either in new common stock or cash;

• Holders of unsecured convenience claims will recover 10% in cash;

• Intercompany claims will be reinstated; and

• Holders of old preferred stock, old common stock and section 510(b) claims will receive no distribution.

Special Devices, a Moorpark, Calif., manufacturer of pyrotechnic devices for airbags, filed for bankruptcy on Dec. 15, 2008. Its Chapter 11 case number is 08-13312.

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