Summary of December 1 Hearing
DIP Financing
On December 1, 2006, the Court, over the objections of the secured lenders and other creditors, granted the Debtors' motion to obtain post-petition financing from Bear Stearns Investment Products, Inc. ("Bear Stearns"). The Order entered on December 5, 2006 authorized the Debtor to receive the balance of a $2,600,000 revolving line of credit from Bear Stearns. The post-petition financing is necessary for the Debtors to continue their businesses and to manage and preserve the assets of their estates. The interest on the loan is due monthly and accrues at a rate of 15% per annum. The entire loan is due on the earlier of the confirmation of the plan of reorganization; conversion to a Chapter 7 case; the 180th day following entry of the order approving the loan; appointment of a trustee; or a default under the loan agreement.
In order to secure the post-petition loan, Bear Stearns received a first priority security interest in all assets that were not otherwise encumbered, including all proceeds from avoidance actions up to the first $350,000 of the recovery and then half of all recoveries over $700,000. In addition, Bear Stearns received a perfected lien and security interest in all of the Debtors' collateral junior to all other security interests in the collateral that were validly perfected before the post-petition loan was approved. Lastly, Bear Stearns was granted a superpriority administrative claim for the loan.
Motion authorizing the Debtors to pay employees of Kara Birbach Geller & Co., Ltd.
Kara Birbach Geller & Co. is a non-debtor affiliate that employs salepeople involved in the sale of homes to the public. The employees continue to work for the Debtors and this motion sought to continue to pay the employees of Kara Birbach Geller & Co. in the ordinary course. There were no objections to this motion and the Court granted the motion.
Motion enjoining Atlantic City Electric from discontinuing utility service
The Court rescheduled this Motion to December 26, 2006 at 1:00 pm.
On December 1, 2006, the Court, over the objections of the secured lenders and other creditors, granted the Debtors' motion to obtain post-petition financing from Bear Stearns Investment Products, Inc. ("Bear Stearns"). The Order entered on December 5, 2006 authorized the Debtor to receive the balance of a $2,600,000 revolving line of credit from Bear Stearns. The post-petition financing is necessary for the Debtors to continue their businesses and to manage and preserve the assets of their estates. The interest on the loan is due monthly and accrues at a rate of 15% per annum. The entire loan is due on the earlier of the confirmation of the plan of reorganization; conversion to a Chapter 7 case; the 180th day following entry of the order approving the loan; appointment of a trustee; or a default under the loan agreement.
In order to secure the post-petition loan, Bear Stearns received a first priority security interest in all assets that were not otherwise encumbered, including all proceeds from avoidance actions up to the first $350,000 of the recovery and then half of all recoveries over $700,000. In addition, Bear Stearns received a perfected lien and security interest in all of the Debtors' collateral junior to all other security interests in the collateral that were validly perfected before the post-petition loan was approved. Lastly, Bear Stearns was granted a superpriority administrative claim for the loan.
Motion authorizing the Debtors to pay employees of Kara Birbach Geller & Co., Ltd.
Kara Birbach Geller & Co. is a non-debtor affiliate that employs salepeople involved in the sale of homes to the public. The employees continue to work for the Debtors and this motion sought to continue to pay the employees of Kara Birbach Geller & Co. in the ordinary course. There were no objections to this motion and the Court granted the motion.
Motion enjoining Atlantic City Electric from discontinuing utility service
The Court rescheduled this Motion to December 26, 2006 at 1:00 pm.
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