By Chris Wack
GWG Holdings Inc. said it and some of its subsidiaries have filed voluntary Chapter 11 petitions with the U.S. Bankruptcy Court for the Southern District of Texas as part of a restructuring process.
The company said the restructuring was intended to enable it to improve its liquidity and its ability to meet its financial obligations, while increasing the value of its assets.
The debtor subsidiaries in the Chapter 11 cases are GWG Life LLC and GWG Life USA LLC.
GWG Holdings stock was halted in premarket trading at $1.89.
The company also said it had obtained financing from the debtor in possession to facilitate the restructuring and had filed a petition with the court for the approval of this financing.
The DIP Credit Agreement is structured as a $65 million multi-draw term loan facility and will be provided by National Founders LP.
Proceeds from all or part of the DIP Credit Agreement may be used for, among other things, general corporate purposes, including working capital and permitted acquisitions, administrative expenses, bonuses, expenses and transaction fees contemplated by Chapter 11 cases, and for other purposes consistent with the DIP Credit Agreement.
GWG Holdings intends to continue its day-to-day operations as a debtor in possession.
Write to Chris Wack at [email protected]