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Tropical Sportswear liquidation plan lists $60 million of cash to distribute to creditors
New York, March 18 - Tropical Sportswear International Corp. currently has $60 million of cash that will be distributed to creditors, according to the company's disclosure statement for its plan of liquidation filed Thursday with the U.S. Bankruptcy Court for the Middle District of Florida.
Under the plan, secured, administrative and priority claims will be paid first along with any amounts owing under the debtor-in-possession facility.
As of the date the disclosure statement was prepared, CIT, the DIP agent, has no liens on any of the company's property other than cash held as collateral for letters of credit.
Tropical Sportswear will also repay in full the customs bond agent which currently holds $5.3 million of the company's cash. After debt to the U.S. Customs Service is paid, any extra cash will be released.
Next in line are unsecured creditors with a total of $110 million in claims including the $105.36 million owing on Tropical Sportswear's $100 million principal amount of 11% senior subordinated notes due 2008.
Unsecured creditors with claims below $2,000 or willing to reduce their claim to $2,000 can opt to be treated as convenience claims, which will be paid at the rate of 40% in cash.
Other unsecured creditors will receive the company's cash via a liquidating trust that will be created to handle distributions.
A hearing to confirm the plan of liquidation is scheduled for May 18.
Perry Ellis International, Inc. announced Feb. 28 that it completed the acquisition of the domestic operating assets of Tropical Sportswear International and the outstanding capital stock of Tropical Sportswear's U.K. subsidiary for $88.5 million in cash.
Tropical, based in Tampa, Fla., filed for bankruptcy on Dec. 16. Its Chapter 11 case number is 04-24134.
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