American LaFrance Files Plan of Reorganization

American LaFrance, LLC (the "Company" or "ALF") announced today that it has filed its Plan of Reorganization ("Plan") and supporting Disclosure Statement. The court has set March 3, 2008 to approve the Disclosure Statement and April 9, 2008 to approve the confirmation of the Plan. Contemporaneously, the Company filed a motion to sell the assets of the Company if the Plan is not approved by creditors and confirmed by the bankruptcy court. The Company's related motion to establish bidding procedures is set for hearing on February 21, 2008. The Company has secured an agreement with Patriarch Partners Agency Services to serve as the stalking horse bidder for the asset sale.

The Plan contemplates satisfaction in full of all senior secured debt, administrative claims, and priority claims. To address the $84 million of contingent and non-contingent general unsecured debt), the Plan provides for the assumption by the reorganized company of approximately $27 million of such claims and establishing a fund of assets including $5 million of cash and litigation assets with an estimated value of $17 million for the remainder of the claimants to share pro-rata. Unsecured creditors with balances $2,500 or below (or those willing to reduce the claim to $2,500) will be paid in full without interest.
William K. Snyder, the proposed CRO, stated, "This Plan allows the Company to clear the deck of contentious litigation, clean up its balance sheet and quickly exit bankruptcy; it is anticipated the unsecured creditors would much prefer reorganization with a significant return than a quick asset sale followed by liquidation of the old company."
The Plan will allow the Company to reject leases and unprofitable contracts so that it may be profitable and to restructure its debt for long term success. The Company has announced the closure of its Sanford, FL; Lake Mary, FL; Hanahan, SC; Lebanon, PA; Jedburg, SC and Portland, OR facilities in order to consolidate and reduce overhead expenses.
American LaFrance, LLC, through its predecessor entities, is one of the oldest fire, rescue, and EMS vehicle manufacturers in the United States, dating back to its founding in 1832. The Company operates 8 manufacturing/servicing facilities and two company-owned vehicle dealerships.