Elah Holdings Inc fka RELYQ (ELLH)

[Enterprising Investor]

Plan Confirmation and Treatment of Claims and Interests (5/02/18)

[Edited]

The Bankruptcy Court entered an order confirming the Company’s amended plan of reorganization. The Confirmation Order is subject to a stay that will expire at 12:01 a.m. on 5/09/18 The Effective Date will occur on 5/09/18.

The following is a summary of the material terms of the RI Plan.

The RI Plan generally provides for the payment in full of all timely filed and undisputed claims held by the Company’s secured and unsecured creditors, with secured creditors’ claims to be paid in full in cash or as otherwise permissible by the Bankruptcy Code, and each of unsecured priority claims and general unsecured creditors’ claims to be paid in full in cash or otherwise as the holders of such claims agree.

Under the RI Plan, because Class 5 voted to approve the Proposed RI Plan, the holders of the Common Stock interests that are outstanding prior to the Effective Date will receive their pro rata share of 20% of the common stock of the Company (the “New Common Stock”) to be issued and outstanding as of the Effective Date in full satisfaction, release and discharge of and in exchange for such allowed common interests. The holders of the Company’s Series B Preferred interests will, in addition to a $2 million cash payment, receive 31% of the New Common Stock as of the Effective Date in full satisfaction, release and discharge of and in exchange for such the Series B Preferred shares.

Further, as provided in the RI Plan, as of the Effective Date, the Reorganized Company will issue the number of shares, in the aggregate, that is equal to 49% of the New Common Stock to those entities (or their affiliates) who provided the Company’s debtor-in-possession financing (the “DIP Facility”) and sponsors of the Proposed RI Plan (the “SPA Investors”) for $17.5 million, less the amount of outstanding principal and interest on the DIP Facility, pursuant to a Securities Purchase Agreement to be entered into with such parties on the Effective Date (the “SPA”). The funding of payments to the Company’s creditors, the $2 million cash settlement to the holder of the Company’s Series B Preferred interests and other costs and expenses necessary to consummate the RI Plan shall be made from the proceeds of such sale to the SPA Investors. Holders of warrant interests shall receive in full satisfaction, settlement, release and discharge of and exchange for such allowed warrant interests, $0.09 per warrant, and such warrants shall be cancelled on the Effective Date. All option contracts, other warrant interests and other equity interests not already exercised, converted or exchanged for the Common Stock are otherwise to be terminated under the RI Plan as of the Effective Date.

On the Effective Date, the Company will adopt new organizational documents, which include a change of the Company’s name to “ELAH Holdings, Inc.”, and the board of directors of the Reorganized Company will be fixed at five persons in a three-class, classified board structure. These five directors will be appointed as of the Effective Date: two to be appointed by the SPA

Investors, one to be appointed by the holder of the Company’s Series B Preferred Interests, one who has been selected by the Company to represent existing common stock interest holders, and one independent director. On the Effective Date, the officers of the Company will continue to serve as officers of the Reorganized Company.

The Reorganized Company’s revised organizational documents will continue to have similar transfer restrictions on any transfer of shares that would result in a holder obtaining 4.9 percent or greater of the total outstanding issued New Common Stock that presently are contained in the Company’s Amended and Restated Bylaws.

The RI Plan further provides that the Reorganized Company will abandon the equity interests in RAIH upon the earlier of the consummation of the sale of the assets of Real Alloy or 6/30/18.

The foregoing descriptions of the Confirmation Order and RI Plan do not purport to be complete and are qualified in their entirety by reference to the Confirmation Order and RI Plan attached hereto as Exhibit 99.1 and 2.1, respectively, and incorporated herein by reference.

As set forth under the RI Plan, on the Effective Date, the shares of Common Stock will be cancelled, and holders of such shares of Common Stock of the Company will receive one share of New Common Stock for each 200 shares of Common Stock held. As provided in the RI Plan, fractional shares created by such 1:200 exchange ratio will be rounded up at 0.51 shares or more and down at 0.50 shares or less, and there will be no cash payment in lieu of fractional shares. Therefore, holders of 100 or fewer shares of Common Stock prior to the Effective Date will receive no shares or cash as a result of the action in the RI Plan. In connection with the processing of the reorganized capitalization of the Company by the Company’s transfer agent, FINRA, and the Depository Trust Company, the Company anticipates there may be a period of time in which the Common Stock and New Common Stock may have suspended trading or trade on a very limited basis, while the administration of the new capitalization as set forth in the RI Plan is being implemented.

Further, as previously disclosed, under the Proposed RI Plan and RI Plan, the Company intends to deregister its common stock from reporting with the Securities and Exchange Commission (“SEC”) and expects to file a Form 15 with the SEC as soon as practicable. The Company expects that the common stock of the Reorganized Company will continue to trade, subject to the foregoing paragraph, on the Over The Counter Pink Sheets.

Cautionary Note Regarding the Company’s Common Stock

The Company cautions that trading in its securities during the pendency of the Chapter 11 Proceedings and through the Effective Date is highly speculative and poses substantial risks.

Additional Information on the Chapter 11 Proceedings

Court filings and other information related to the court-supervised proceedings are available at a website administered by the Company’s claims agent, Prime Clerk, at https://cases.primeclerk.com/realindustry. Additional information on Real Industry can be found at its website www.realindustryinc.com.

https://www.sec.gov/Archives/edgar/data/38984/000155837018004062/f8-k.htm