California Bankruptcy Lawyer Blog

Fremont Bankruptcy Lawyer Discusses Creditors of Advanced Marketing Services Want Bankruptcy Judge To Order Company To Liquidate

Advanced Marketing Services, a bestselling book distributor to warehouse stores, is encountering resistance from creditors to its Chapter 11 bankruptcy reorganization efforts. In a petition filed last week by AMS’s unsecured creditors, a judge is being asked to order the company to cease operations and “transition into liquidation mode.”

A hearing is scheduled today for a federal bankruptcy judge to hear AMS’s proposal for how it will develop a plan to sell, partially sell, or refinance the business. The California-based company says it has formed confidentiality agreements with potential buyers and investors. It wants a bankruptcy judge to grant it permission to sell Publishers Group West, one of its subsidiaries, to publishing and distribution company Perseus Books.

While AMS’s creditors support the sale of Publishers Group West, they believe that the debtor is insolvent and should stop spending money by shutting down its operations. Last week, a committee of AMS’s unsecured creditors filed objections to the company’s proposal, which they are convinced will fail. Penguin Books and Random House are members of the committee.

“Because AMS's business has crumbled, AMS is no longer a viable business entity, and it should quickly ratchet back the scope of the operations and expenses and transition into a liquidation mode,” said a committee member.

Continue reading " Fremont Bankruptcy Lawyer Discusses Creditors of Advanced Marketing Services Want Bankruptcy Judge To Order Company To Liquidate " »

Posted by Scott Sagaria | Permalink | Email This Post | Comments (0)

Posted In: Chapter 11

Bookmark:

Redwood City Bankruptcy Attorney Discusses Delta Air Lines Creditors Request Postponement of Bankruptcy Hearing

In the Delta Airlines Chapter 11 bankruptcy case, an adhoc creditors committee for the carrier company is requesting a postponement of a February 7 bankruptcy hearing. The creditors say they want to examine a $9.87 billion offer from US Airways Group Inc. to purchase the bankrupt carrier company.

In a written statement submitted yesterday, the creditors said that the US Airways offer of cash and stock offers a "superior recovery for creditors compared to what they would receive under Delta's standalone Chapter 11 plan." The creditors group is made up of creditors holding approximately $2.4 billion in claims. Previously, the creditors had asked Delta to consider the U.S. Airways offer. Now, they want the official creditors committee to ask Delta to look at the offer.

According to Anne Granfield, a spokeswoman for the ad hoc committee, "As it stands, unless the official committee comes out and says something, creditors won't have a choice."

According to Granfield, US Airways says it will increase its bid amount for Delta as long as the creditors are able to postpone the hearing. US Airways, however, says it has not offered to increase its offer, which will expire on February 1. But the carrier does say that it will withdraw its bid if Delta’s reorganization hearing isn’t postponed by Thursday. US Airways had attempted a hostile takeover to purchase Delta last November.

Delta estimates that its value will be somewhere between $9.4 billion and $12 billion if it exits from Chapter 11 bankruptcy by the middle of the year as a standalone company. Once its disclosure statement, which it submitted in December, is approved, the carrier company can begin soliciting votes to get its reorganization plan approved.

Continue reading " Redwood City Bankruptcy Attorney Discusses Delta Air Lines Creditors Request Postponement of Bankruptcy Hearing " »

Posted by Scott Sagaria | Permalink | Email This Post | Comments (0)

Posted In: Chapter 11

Bookmark:

San Jose Bankruptcy Lawyer Discusses City of Los Angeles Files Objection To Delta’s Bankruptcy Reorganization Plan

The California city of Los Angeles has filed an objection to Delta Air Lines Inc.’s Chapter 11 bankruptcy reorganization plan, claiming that the plan cannot be approved because of the undue authority it gives Delta to reject certain leases.

The city of Los Angeles owns Ontario International Airport and Los Angeles International Airport, both airports in Southern California where Delta maintains its leases and runs its operations. The city claims that Delta’s disclosure statement does not describe the possible effect that ending its Terminal 5 lease at LAX would have on the airline company’s financial performance and operations. Without this information, the city of LA and other creditors cannot accurately evaluate the workability of Delta’s reorganization plan.

LA also says that Delta’s reorganization plan improperly gives the airline company broad discretion to defer its decisions when it comes to rejecting or assuming certain unexpired leases beyond the effective plan date.

The airline company, which filed for Chapter 11 bankruptcy in 2005, estimates that it will be worth $9.4 billion to $12 billion if it emerges from bankruptcy protection as planned and as a standalone company by mid-2007.

Continue reading " San Jose Bankruptcy Lawyer Discusses City of Los Angeles Files Objection To Delta’s Bankruptcy Reorganization Plan " »

Posted by Scott Sagaria | Permalink | Email This Post | Comments (0)

Posted In: Bankruptcy Law , Chapter 11

Bookmark:

San Mateo Bankruptcy Attorney Discusses Pacific Lumber Company Files For Bankruptcy Protection

Pacific Lumber Co. announced last week that it had filed for Chapter 11 bankruptcy protection. The lumber company said a major reason that it needed to file for bankruptcy was because it had entered into the “Headwaters agreement,” which protected some of the world’s largest and oldest redwood trees from being chopped up at lumber mills.

Pacific Lumber is one of the largest timber companies in California. It filed for bankruptcy protection at a Texas federal court in Corpus Christi, Texas. Based in Scotia, California, the lumber company said it would not be able to make its $27 million interest payment that was due to bond holders last Saturday. This missed payment, according to Pacific Lumber, would cause the company to default on $714 worth of loans and lose the 200,000 acres of timberlands in Humboldt County that it had used for collateral.

Pacific Lumber, the State of California, and the U.S. government had signed an agreement giving the timber company 7700 acres of public timberland and $300 million in exchange for 5,600 acres of company land, where some of the tallest and oldest redwood trees in the world continue to grow. The deal also included a “habitat conservation plan” which regulated how many trees the company cut down.

In December 2006, Pacific Lumber filed a lawsuit against California claiming that certain government regulations ran afoul of the agreement. The timber company said the agreement had increased its logging expenses and the conservation plan made it so hard to cut down trees that the company’s future had been put at risk.

Continue reading " San Mateo Bankruptcy Attorney Discusses Pacific Lumber Company Files For Bankruptcy Protection " »

Posted by Scott Sagaria | Permalink | Email This Post | Comments (0)

Posted In: Chapter 11

Bookmark:

http://www.sagarialaw.com/lawyer-attorney-1176211.htmlSan Jose Bankruptcy Attorney Discusses San Jose-Based Calpine Corp. Seeks Investors To Finance Chapter 11 Bankruptcy Exit

Calpine Corp. says that it is looking for new equity investors to help finance its exit from Chapter 11 Bankruptcy. The San Jose-based energy company also says that it has given a business plan—which could form the basis of its proposed reorganization—to creditors.

Calpine has been under bankruptcy protection since December 2005. The company has until June 20 to submit its reorganization plan that will show how it plans to exit Chapter 11 and pay back creditors.

In Court papers, the energy company stated that its net loss between December 2005 and November 2006 was $800 million greater than for that same period of time the year previous. The company attributes the loss to spending $1 billion in reorganization items. It’s core operating results, however, improved from the past year.

Calpine is the number one operator of natural-gas-fired power plants in the United States. It powers 27 million homes and supplies 3.5% of all electricity used in the US. The company has sold nearly 1/5 of its 92 plants since filing for bankruptcy protection.

Continue reading " San Jose Bankruptcy Attorney Discusses San Jose-Based Calpine Corp. Seeks Investors To Finance Chapter 11 Bankruptcy Exit " »

Posted by Scott Sagaria | Permalink | Email This Post | Comments (0)

Posted In: Bankruptcy Law

Bookmark: