On February 2, 2007 another affiliate of Kara Homes, Horizons at Shrewbury Commons, LLC (“Shrewbury Commons”), filed a petition for relief under Chapter 11 of the Bankruptcy Code. Shrewbury Commons lists $14,000,000 of secured debt and $87,357.60 of general unsecured debt. In addition, the only asset listed is inventory of 66 contracts with an undisclosed value.
On February 5, 2007, the Court held a hearing addressing the following items:
1. Final Hearings authorizing Debtors to incur post-petition secured indebtedness for the purpose of winterizing the Debtors’ estates: The Debtors have entered into consent agreements with various lenders to secure financing to winterize each development on a development-by-development basis. Final hearings were scheduled for February 5, 2007 on the Debtors’ (a) interim order authorizing the Debtors to incur post-petition secured indebtedness from Bank of America, NA for the purpose of winterizing Kara at Navesink, LLC and Kara at Lacey, LLC, (b) interim order authorizing the Debtors to incur post-petition secured indebtedness from ING Direct for the purpose of winterizing Horizon at Woods Landing, LLC, and (c) interim order authorizing the Debtors to incur post-petition secured indebtedness from Yardville National Bank for the purpose of winterizing Estates at Galloway Woods, LLC.
a) Final and Amended Order authorizing Debtors to incur post-petition secured indebtedness from Bank of America for the purpose of winterizing Kara at Navesink, LLC and Kara at Lacey, LLC: The Court granted this motion authorizing the Debtors to obtain post-petition financing to winterize Kara at Navesink and Kara at Lacey. Bank of America has a first priority lien, not subject to priming, on both Kara at Navesink and Kara at Lacey and shall be repaid, with interest, upon the sale of the properties.
b) Final Order authorizing Debtors to incur post-petition secured indebtedness from ING Direct for the purpose of winterizing Horizons at Woods Landing: The Court granted this motion authorizing the Debtors to incur up to $233,018.00 to winterize the property at Horizons at Woods Landing. ING Direct has a first priority lien on the Horizons at Woods Landing property in the amount necessary to winterize the property which is not subject to avoidance, subordination or challenge by any party-in-interest.
c) Final Order authorizing Debtors to incur post-petition secured indebtedness from Yardville National Bank for the purpose of winterizing Estates at Galloway Woods: The Court granted this motion authorizing the Debtors to incur up to $88,370.00 to winterize the property at Estates at Galloway Woods. Yardville National Bank has a first priority lien on the Estates at Galloway Woods property in the amount necessary to winterize the property which is not subject to avoidance, subordination or challenge by any party-in-interest.
2. Motion for relief from stay by the estate of Edwin Zuczek and Joan Zuczek to proceed with the civil trial pending before the New Jersey Superior Court Law Division: The parties entered into a consent order.
3. Motion to compel assumption or rejection of contract to purchase home at 76 Vicari Way, Winding Run Estates by Kara, LLC, Little Egg Harbor: The parties entered into a consent order.
4. Motion for relief from stay re: 4085 West Jersey Avenue and various properties located on Monet Drive filed by the Township of Hamilton (Atlantic County):
The Court denied the motion without prejudice.
5. Motion for relief from the stay re: property located at Horizons at Woods Landing filed by the Township of Hamilton (Atlantic County): The Court denied the motion without prejudice.
6. Motion to approve settlement agreement between Quakerbridge Mews, LLC, Kara Homes, LLC and Kara Homes Development, LLC: The court approved the settlement. Quakerbridge Mews and the Debtors were engaged in a joint venture to develop two lots in Wall Township (the “Joint Venture”). Disputes have arisen due to non-performance under the Joint Venture and the parties have agreed to settle the disputes. The terms of the settlement provide that Quakerbridge Mews will purchase the Debtors interest in the Joint Venture for the sum of $275,000 ($225,000 on the entry of the settlement and $50,000 on the sale or foreclosure of the second lot). In addition, Quakerbridge Mews assumes all duties and obligations under the Joint Venture and indemnifies the Debtors from any third parties in connection with the Joint Venture.
7. Motion to extend date by which Debtors must file plans of reorganization: The motion was adjourned until February 15, 2007.
8. Motion to compel Debtors to assume or reject executory contracts and for injunctive relief filed by Eric H. Lindenman on behalf of Bond Safeguard Insurance Co., Lexon Insurance Co.: Adjourned to February 20, 2007.
9. Cross Motion for an Order pursuant to 11 U.S.C 1112(b) converting Debtors' cases to cases under Chapter 7 of the Code by North Fork Bank: Withdrawn by WCP Real Estate Strategies Fund, LP.
10. Application authorizing Debtors to pay expense reimbursement fees with respect to securing construction financing facility: Withdrawn by Debtors.
On February 15, 2007 at 10:00 am the Court is scheduled to hear the motions to determine whether the Debtor-affiliates are “single asset real estate” entities for purposes of the Bankruptcy Code and the evidentiary hearing related to the motion for termination of Donna and Seoung Baik’s contract.
The next omnibus hearing date is scheduled for February 20, 2007 at 1:00 pm in Trenton, New Jersey.
On February 5, 2007, the Court held a hearing addressing the following items:
1. Final Hearings authorizing Debtors to incur post-petition secured indebtedness for the purpose of winterizing the Debtors’ estates: The Debtors have entered into consent agreements with various lenders to secure financing to winterize each development on a development-by-development basis. Final hearings were scheduled for February 5, 2007 on the Debtors’ (a) interim order authorizing the Debtors to incur post-petition secured indebtedness from Bank of America, NA for the purpose of winterizing Kara at Navesink, LLC and Kara at Lacey, LLC, (b) interim order authorizing the Debtors to incur post-petition secured indebtedness from ING Direct for the purpose of winterizing Horizon at Woods Landing, LLC, and (c) interim order authorizing the Debtors to incur post-petition secured indebtedness from Yardville National Bank for the purpose of winterizing Estates at Galloway Woods, LLC.
a) Final and Amended Order authorizing Debtors to incur post-petition secured indebtedness from Bank of America for the purpose of winterizing Kara at Navesink, LLC and Kara at Lacey, LLC: The Court granted this motion authorizing the Debtors to obtain post-petition financing to winterize Kara at Navesink and Kara at Lacey. Bank of America has a first priority lien, not subject to priming, on both Kara at Navesink and Kara at Lacey and shall be repaid, with interest, upon the sale of the properties.
b) Final Order authorizing Debtors to incur post-petition secured indebtedness from ING Direct for the purpose of winterizing Horizons at Woods Landing: The Court granted this motion authorizing the Debtors to incur up to $233,018.00 to winterize the property at Horizons at Woods Landing. ING Direct has a first priority lien on the Horizons at Woods Landing property in the amount necessary to winterize the property which is not subject to avoidance, subordination or challenge by any party-in-interest.
c) Final Order authorizing Debtors to incur post-petition secured indebtedness from Yardville National Bank for the purpose of winterizing Estates at Galloway Woods: The Court granted this motion authorizing the Debtors to incur up to $88,370.00 to winterize the property at Estates at Galloway Woods. Yardville National Bank has a first priority lien on the Estates at Galloway Woods property in the amount necessary to winterize the property which is not subject to avoidance, subordination or challenge by any party-in-interest.
2. Motion for relief from stay by the estate of Edwin Zuczek and Joan Zuczek to proceed with the civil trial pending before the New Jersey Superior Court Law Division: The parties entered into a consent order.
3. Motion to compel assumption or rejection of contract to purchase home at 76 Vicari Way, Winding Run Estates by Kara, LLC, Little Egg Harbor: The parties entered into a consent order.
4. Motion for relief from stay re: 4085 West Jersey Avenue and various properties located on Monet Drive filed by the Township of Hamilton (Atlantic County):
The Court denied the motion without prejudice.
5. Motion for relief from the stay re: property located at Horizons at Woods Landing filed by the Township of Hamilton (Atlantic County): The Court denied the motion without prejudice.
6. Motion to approve settlement agreement between Quakerbridge Mews, LLC, Kara Homes, LLC and Kara Homes Development, LLC: The court approved the settlement. Quakerbridge Mews and the Debtors were engaged in a joint venture to develop two lots in Wall Township (the “Joint Venture”). Disputes have arisen due to non-performance under the Joint Venture and the parties have agreed to settle the disputes. The terms of the settlement provide that Quakerbridge Mews will purchase the Debtors interest in the Joint Venture for the sum of $275,000 ($225,000 on the entry of the settlement and $50,000 on the sale or foreclosure of the second lot). In addition, Quakerbridge Mews assumes all duties and obligations under the Joint Venture and indemnifies the Debtors from any third parties in connection with the Joint Venture.
7. Motion to extend date by which Debtors must file plans of reorganization: The motion was adjourned until February 15, 2007.
8. Motion to compel Debtors to assume or reject executory contracts and for injunctive relief filed by Eric H. Lindenman on behalf of Bond Safeguard Insurance Co., Lexon Insurance Co.: Adjourned to February 20, 2007.
9. Cross Motion for an Order pursuant to 11 U.S.C 1112(b) converting Debtors' cases to cases under Chapter 7 of the Code by North Fork Bank: Withdrawn by WCP Real Estate Strategies Fund, LP.
10. Application authorizing Debtors to pay expense reimbursement fees with respect to securing construction financing facility: Withdrawn by Debtors.
On February 15, 2007 at 10:00 am the Court is scheduled to hear the motions to determine whether the Debtor-affiliates are “single asset real estate” entities for purposes of the Bankruptcy Code and the evidentiary hearing related to the motion for termination of Donna and Seoung Baik’s contract.
The next omnibus hearing date is scheduled for February 20, 2007 at 1:00 pm in Trenton, New Jersey.
