GWG Holdings Solicits Votes for Chapter 11 Plan

DALLAS, May 15, 2023 (GLOBE NEWSWIRE) -- On May 15, 2023, GWG Holdings, Inc. (“GWG” or the “Company”) (OTC: GWGHQ) announced that it and its fellow debtors-in-possession in the Chapter 11 cases pending at 22-90032 in the United States Bankruptcy Court for the Southern District of Texas Houston Division (the “Court”) are soliciting votes for the Debtors’ Further Modified Second Amended Joint Chapter 11 Plan, Submitted by the Debtors, the Bondholder Committee, and L Bond Management, LLC as Co-Proponents (the “Plan”) following the Court’s approval of the Disclosure Statement for the Debtors’ Second Amended Joint Chapter 11 Plan (the “Disclosure Statement”). The Plan is supported by the Official Committee of Bondholders (the “Bondholder Committee”), the fiduciary appointed in the Chapter 11 cases to represent the interests of all Bondholders.

The Plan provides for the creation of two separate trusts—the Wind Down Trust and the Litigation Trust—each of which will monetize their respective assets with the goal of maximizing the value of those assets for the benefit of Bondholders and other creditors and equityholders. The Wind Down Trust will hold the beneficial interest in the Litigation Trust and will hold all of GWG’s current assets (except litigation claims and interests in its D&O Liability Insurance Policies). The assets to be held by the Wind Down Trust include all of GWG’s interests in (i) Beneficient, (ii) FOXO, and (iii) the Policy Portfolio. The Wind Down Trust will monetize its assets and distribute the net proceeds to Bondholders until they are paid in full, then, if any value remains, to other stakeholders. The Litigation Trust will receive all of GWG’s litigation claims and all of GWG’s interests in the D&O Liability Insurance Policies. The net amount recovered from the pursuit or settlement of these litigation claims will be distributed to the Wind Down Trust for further distribution as provided in the Plan. The Debtors and the Bondholder Committee believe that the Plan will result in greater recovery to Bondholders than would a liquidation under chapter 7 of the Bankruptcy Code.  

Jeffrey S. Stein, the Company’s Chief Executive Officer and Chief Restructuring Officer, said, “I believe that the Plan provides the best path forward for maximizing the potential recoveries for the Company’s creditors and is fully supported by the Bondholder Committee and the Ad Hoc Group of Broker/Dealers. We are pleased that the Disclosure Statement was approved and encourage all creditors to vote to accept the Plan so that the Company can emerge from Chapter 11 and the Trusts can proceed with their orderly efforts to maximize the value of the Company’s assets.”