Remington Outdoor Company, one of the largest US makers of firearms, has filed for bankruptcy protection to carry out a debt-cutting deal with creditors amid mounting public pressure for greater gun control.
The company's chief financial officer, Stephen Jackson, said in court papers that Remington's sales fell significantly in the year before its bankruptcy.
He said the company was having difficulty meeting requirements from its lenders.
Remington, America's oldest gunmaker, announced in February it would reduce its $950m debtload in a deal that will transfer control of the company to creditors.
The company plans to wrap up its bankruptcy as soon as May 3, according to court papers.
The filing comes after a February 14 shooting at a Parkland, Florida high school that killed 17 and spurred an intense campaign for gun control by activists.
The massacre led to huge US anti-gun rallies by hundreds of thousands of young Americans on Saturday.
In some of the biggest US youth demonstrations for decades, protesters called on politicans and President Donald Trump to confront the issue.
Voter registration activists fanned out in the crowds, signing up thousands of the nation's newest voters.
Major US companies and retailers have taken some steps to restrict firearm sales.
Citigroup said last week it will require new retail-sector clients to sell firearms only to customers who passed background checks and to bar sales of high-capacity magazines.
Citi also said it was restricting sales for buyers under 21, a move adopted by other large retailers, while Kroger Co's superstore chain Fred Meyer said it will stop selling firearms entirely.
Cerberus Capital Management, the private equity firm that controls Remington, will lose ownership in the bankruptcy.
Remington's creditors, which sources told Reuters include Franklin Templeton Investments and JPMorgan Asset Management, will exchange their debt holdings for Remington equity.
The creditors inked the debt-cutting deal prior to the Parkland shooting, and it is unclear if any have exited.
The restructuring support agreement allows creditors to sell their holdings, but the buyer is bound by the deal.
After a Remington Bushmaster rifle was used in the Sandy Hook elementary school shooting in Connecticut in 2012 that killed 20 children and six adults, Cerberus tried unsuccessfully to sell Remington, then known as Freedom Group.
Remington and other gunmakers have suffered from slumping sales in the past year as fears of stricter gun laws have faded.
The chief executive of American Outdoor Brands, maker of the Smith & Wesson gun used in the Parkland shooting, said on March 1 that some gun retailers reported increased sales after the Florida school shooting.