Raytech Corporation Announces Emergence From Bankruptcy

    SHELTON, Conn.--April 18, 2001--Raytech Corporation today reported that the Confirmation of the Corporation's Second Amended Plan of Reorganization ("Plan") became effective on this date, April 18, 2001 ("Effective Date"). The United States Bankruptcy Court for the District of Connecticut ("Court") had confirmed the Plan on August 31, 2000, but the effectiveness of the Plan had been delayed pending the occurrence of conditions precedent. The conditions were all met on this date, and the Plan became effective.
    The Plan provides for allowed general unsecured claims, including asbestos-related personal injury allowed claims estimated to be $6.76 billion and environmental allowed claims of $432 million to be exchanged for 90% of the common stock of the Corporation, as well as certain other consideration, with existing equity holders in the Corporation retaining their shares equivalent to 10% of the common stock of the Corporation.
    In accordance with the Plan, all present and future asbestos-related personal injury claims are assumed and will be resolved by an independently administered claims trust ("P.I. Trust"). A channeling injunction has been ordered by the Court pursuant to Section 524(g) of the Bankruptcy Code, which permanently stays, enjoins and restrains any current or future asbestos-related claims against the Corporation, thereby channeling such claims to the P.I. Trust for resolution.
    The Plan provides for the classification and treatment of all claims against, and equity interests in the Corporation in exchange for and in complete satisfaction, discharge and release of all such claims and equity interests.
    Accordingly, the Corporation has emerged from bankruptcy under its confirmed and effective Plan. The Corporation intends to file its Form 8-K on April 20, 2001.
    Raytech Corporation is a global manufacturer of energy absorption and power transmission products, as well as custom engineered components.