O-I Glass, Inc. announced that wholly owned subsidiary Paddock Enterprises, LLC has filed its plan of reorganization and a related disclosure statement with the United States Bankruptcy Court for the District of Delaware as part of the Chapter 11 bankruptcy case Paddock initiated on January 6, 2020.
The Plan, once confirmed by the courts, will result in a permanent resolution of all current and future asbestos personal injury claims. The Plan is jointly proposed by the “Plan Proponents,” which are O-I Glass, the Official Committee of Asbestos Personal Injury Claimants, Paddock, and the legal representative for future asbestos personal injury claimants.
Andres Lopez, CEO of O-I Glass, said, “We are pleased that Paddock is one significant step closer towards achieving the goal of resolving its legacy liabilities in a manner that is fair and efficient for claimants and that provides finality for O-I Glass and Paddock. This plan represents a favourable outcome for all parties, and we look forward to the plan’s implementation as Paddock moves toward emergence.”
The plan’s centrepiece is a trust established under section 524(g) of the Bankruptcy Code that will process and pay asbestos claims pursuant to Asbestos Trust Distribution Procedures. In exchange for funding the asbestos trust, Paddock and its parent company, O-I Glass, as well as certain additional parties, will be protected by an injunction that will prohibit assertion of asbestos claims against the protected parties and will channel all such claims to the asbestos trust.
The asbestos trust would be funded with USD 610 million on the effective date of the plan. The plan follows extensive informal negotiations and over a month of formal mediation proceedings among the plan proponents. A hearing to consider approval of the disclosure statement is scheduled with the Bankruptcy Court for February 16, 2022. Paddock anticipates a confirmation hearing on the plan to be scheduled for the second quarter of 2022.