This is likely to make many sad (probably not), but, the iconic American gun maker Colt and their company Colt Defense LLC, which began in 2002 after Colt’s Manufacturing Company, Inc. reorganized, has filed for “Voluntary Chapter 11.” In other words, they filed for bankruptcy.
The company, however, is calling it “restructuring” — which is just a fancy word for “dealing with the bankruptcy” without freaking out all investors, employees, and management.
According to Keith Maib, Chief “Restructuring” Officer at Colt Defense LLC:
The plan we are announcing and have filed today will allow Colt to restructure its balance sheet while meeting all of its obligations to customers, vendors, suppliers and employees and providing for maximum continuity in the Company’s current and future business operation… Colt remains open for business and our team will continue to be sharply focused on delivering for our customers and being a good commercial partner to our vendors and suppliers. We look forward to successfully executing on this plan, which provides a sound path of stewardship for an iconic American brand and the key stakeholders we serve.
Which is all ‘corporatese’ for “nothing to see here, it’s all going to be fine.. even though the sh*t hit the fan and we had to file Chapter 11.”
According to CNN:
The company has been struggling financially and missed a $10.9 million interest payment on its debt in mid-May.
Let’s see if this “restructuring” of the company works. However, according to the press release:
This press release contains “forward-looking statements.” These statements about Colt’s expectations, beliefs, plans, objectives, assumptions and future events are not statements of historical fact and reflect only Colt’s current expectations regarding these matters. Colt’s actual actions and results may differ materially from what is expressed or implied by these statements due to a variety of factors, including (i) the potential adverse impact of the Chapter 11 filings on Colt’s liquidity or results of operations, (ii) changes in Colt’s ability to meet financial obligations during the Chapter 11 process or to maintain contracts that are critical to Colt’s operations, (iii) the outcome or timing of the Chapter 11 process and the Section 363 process, (iv) the effect of the Chapter 11 filings or the Section 363 process on Colt’s relationships with third parties, regulatory authorities and employees, (v) proceedings that may be brought by third parties in connection with the Chapter 11 process or the Section 363 process, (vi) the Court approval or other conditions or termination events in connection with the Section 363 process, (vii) the increased administrative costs related to the Chapter 11 process; (viii) Colt’s ability to maintain adequate liquidity to fund operations during the Chapter 11 process and thereafter and (ix) other factors listed from time to time in Colt’s filings with Securities and Exchange Commission. Forward-looking statements in this press release speak only as of the date on which they are made and Colt undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Meaning… they’re not nearly out of the woods yet.
As an aside, the Colt website’s description of the history of the company, they say:
Abe Lincoln may have freed all men, but Sam Colt made them equal.
Um, okay. Yeah, no. But that sure sounds nice, doesn’t it?
Creator, Sam Colt’s biggest claim to fame, was the “invention of a weapon capable of firing without reloading” which lead to how modern-day guns are currently made.
The history of the company continues, though, explaining the evolution of guns and the company. Which, to present day, helps supply firearms to not only consumers, but also “military, law enforcement, and international markets.”
Featured image via Flickr – Jin’s diary 87