Bullet-Cougar Golf Reorganization OKd

A reorganization plan that turns Bullet-Cougar Golf Corp.’s chief creditor into the golf club maker’s owner was approved in federal bankruptcy court Friday.

The financial rescue will take effect next Friday, ending the company’s Chapter 11 bankruptcy nearly seven months after it began.

Under the plan, Florida-based Clearwater Fund will waive about $1.9 million in debt in exchange for gaining 100% interest in Bullet-Cougar, chief subsidiary of publicly traded Bullet Sports International Inc.

Unsecured creditors, many of them Bullet-Cougar suppliers, will receive payments from an $850,000 fund, financed largely by Clearwater. The repayment fund will cover about 50% of the unsecured claims that were approved by the court, said Robert Freedman, a Los Angeles-based turnaround specialist hired earlier this year to shepherd Bullet-Cougar through the bankruptcy.

Any additional payments to creditors would be based on Bullet-Cougar’s future profitability, he said.

Terms of the reorganization plan also call for Florida-based Clearwater Fund to provide working capital for Bullet-Cougar, which has corporate offices and its golf club assembly plant in Santa Ana. The company has 43 employees.

Officials at Clearwater Fund could not be reached for comment on their plans for Bullet-Cougar after the reorganization plan takes effect.

Bullet Sports stock closed Friday at 20 cents a share, up 4 cents, in light trading in the over-the-counter market. Officials of the holding company could not be reached for comment.