Colt Defense LLC, the hand-gun maker that skipped an interest payment last month, has entered into a restructuring agreement with loan lenders to provide the necessary funding for a prepackaged bankruptcy plan, Bloomberg News reported today. The agreement includes $15 million in debtor-in-possession loans as well as exit financing should Colt go ahead with a prepackaged chapter 11 case, the company said yesterday. Colt also amended terms of its bond exchange offer and will consider commencing the bankruptcy plan if conditions aren’t met. The West Hartford, Conn.-based weapons maker has been asking creditors since April to choose between a debt-for-debt exchange that Standard & Poor’s called “deeply distressed” or bankruptcy. Colt didn’t pay the $10.9 million due May 15 to holders of its $249.4 million of 8.75 percent unsecured notes due November 2017, S&P said last month in a report.
