Debtor Files Amended Chapter 11 Plan of Reorganization and Amended Disclosure Statement

After the Court entered an Order denying the Debtor’s Disclosure Statement of 12/31/10 subsequent to the hearing held on 2/10/11, the Debtor on 2/17/11 filed an Amended Chapter 11 Plan of Reorganization (“Amended Plan”) and Amended Disclosure Statement, as required by subsequent Order of Court.  The Debtor now proposes to pay unsecured creditors with claims greater than $1,500.00 approximately ten percent (10%) over three (3) years, and those with claims equal to or less than $1,500.00 approximately fifty percent (50%) after Plan confirmation.  A hearing on the approval of the Amended Disclosure Statement is scheduled for February 24, 2011, at 10:00 a.m. in the Bankruptcy Courtroom, U.S. Courthouse, 17 South Park Row, Erie.  

The Debtor also makes certain concessions in its Amended Disclosure Statement to address the prior Objections of Mercer County State Bank, the Pension Benefit Guaranty Corporation, and First Niagara Leasing, Inc.  Additionally the Debtor now includes more specific allocations for the approximately $80,000.00 in proceeds from its prior public auction of unencumbered assets. 

If you would like to have complete access to the Bankruptcy Court docket in this case, you can request a PACER I.D. by following the PACER link on this page, which will enable you to access the docket as well as view and print documents filed in the case.  Please also feel free to contact us at wldcommittee@quinnfirm.com to obtain a copy of the Amended Plan, Amended Disclosure Statement, or any other pleadings as filed.

Mercer County State Bank, Pension Benefit Guaranty Corporation Among Creditors Filing Objections to Debtor’s Disclosure Statement

As posted previously, on December 31, 2010, the Debtor filed its Chapter 11 Plan of Reorganization (“Plan”), Disclosure Statement to Accompany Chapter 11 Plan of Reorganization (“Disclosure Statement”), and Motion for Authority to Incur Secured Debt, to Enter into Financing Agreement with Mercer County State Bank (the “Bank”), and to Grant First Priority Liens pursuant to Bankruptcy Code Section 364(C) (“Motion”).  On January 31, 2011, the Bank filed an Objection to the Disclosure Statement to the extent that it does not adequately explain how the Debtor proposes to make a total distribution of approximately $2,124,000.00 when the Bank has agreed to lend no more than $2,000,000.00 to the Debtor pursuant to the refinancing proposed by the Motion.

In addition on January 28, 2011, the Pension Benefit Guaranty Corporation (“PBGC”) filed an Objection to the Disclosure Statement to the extent that it does not adequately explain how the Debtor intends to treat its alleged obligation to provide retirement benefits to its employees.

Finally on February 3, 2011, First Niagara Leasing Inc. (“First Niagara”) filed an Objection to the Disclosure Statement to the extent that it listed First Niagara’s claim in an amount lower than what First Niagara alleges its claim to be.

A hearing on the approval of the Disclosure Statement is scheduled for February 10, 2011, at 10:00 a.m. in the Bankruptcy Courtroom, U.S. Courthouse, 17 South Park Row, Erie. 

Debtor Files Chapter 11 Plan of Reorganization, Disclosure Statement, and Motion for Authority for Plan Financing

On 12/31/10, the Debtor filed its Chapter 11 Plan of Reorganization (“Plan”) and Disclosure Statement, which proposes to pay unsecured creditors with claims greater than $250.00 approximately ten percent (10%) over three (3) years, and those with claims equal to or less than $250.00 approximately ninety percent (90%) after Plan confirmation.  A hearing on the approval of the Disclosure Statement has been scheduled for February 10, 2011, at 10:00 a.m. in the Bankruptcy Courtroom, U.S. Courthouse, 17 South Park Row, Erie, with objections to the Disclosure Statement due by February 3, 2011.  

Also on 12/31/10 the Debtor filed a Motion for Authority to Incur Secured Debt, to Enter into Financing Agreement with Mercer County State Bank (the “Bank”), and to Grant First Priority Liens pursuant to Bankruptcy Code Section 364(C) (“Motion”).  By the Motion the Debtor seeks to obtain financing from the Bank in the amount of $2,000,000.00 for the purposes of funding the Plan and ongoing operations, in exchange for which the Bank will receive first priority liens on certain of the Debtor’s assets and assets of the Debtor’s principals.  A hearing on the Motion has also been scheduled for February 10, 2011, at 10:00 a.m. in the Bankruptcy Courtroom, U.S. Courthouse, 17 South Park Row, Erie, with objections to the Motion due by February 3, 2011.  


If you would like to have complete access to the Bankruptcy Court docket in this case, you can request a PACER I.D. by following the PACER link on this page, which will enable you to access the docket as well as view and print documents filed in the case.  Please also feel free to contact us at wldcommittee@quinnfirm.com to obtain a copy of the Plan, Disclosure Statement, Motion, or any subsequently filed pleadings.

Court Enters Orders Approving Cash Collateral, Committee Counsel, and Distribution of Sale Proceeds

On November 8, 2010, the Bankruptcy Court entered a Final Order Approving Cash Collateral Stipulation.  A hearing is currently scheduled on the Debtor’s ongoing use of cash collateral for December 2, 2010.

Also on November 12, 2010, the Bankruptcy Court entered an Order Granting Application to Employ Nicholas R. Pagliari and the Law Firm of Quinn, Buseck, Leemhuis,

Toohey and Kroto, Inc. as Counsel to the Official Committee of Unsecured Creditors.

Finally, on or about November 22, 2010, the Bankruptcy Court entered a Consent Order granting the Debtor authority to partially distribute sale proceeds from its prior public auction.  Debtor’s Counsel has been authorized to use up to $10,000 of the $80,365.00 in proceeds from unencumbered assets to fund operational costs and professional fees.  Debtor’s Counsel will continue to hold the remaining proceeds in escrow for the benefit of creditors, subject to further order of Court.