Lowenstein Sandler announced a comprehensive settlement on behalf its client, the Official Committee of Unsecured Creditors of Gibson Brands, one of the world’s premier manufacturers of guitars and other musical instruments. Announced in court as part of Gibson’s Chapter 11 bankruptcy proceedings, the settlement will be implemented in the company’s Third Amended Plan and Disclosure Statement. The settlement provides the opportunity for smaller creditors to receive up to a 50 percent distribution for claim amounts below $40,000 and the opportunity for larger creditors to participate in a litigation trust on a pro rata basis. This is a positive development for the many small, family-run businesses that have conducted business with Gibson for many years. It also represents an important milestone in the course of Gibson’s restructuring efforts and paves the way for confirmation of the company’s restructuring plan in late September 2018.
The Lowenstein team includes Jeffrey Cohen, Bruce D. Buechler, Paul Kizel, Lowell A. Citron, Jennifer F. Delgado, Courtney E. Alvarez, Reynold Lambert, Michael Savetsky, and Gabriel L. Olivera. Lowenstein’s Delaware co-counsel on the engagement is Adam Landis of Landis Rath & Cobb LLP.