Creditor Q and A
A chapter 11 filing is a voluntary action taken by a company that allows a company to continue normal day to day operations while it attempts to “reorganize” its debts. The company, often with the participation of creditors, creates a reorganization plan under which to repay all or part of its debts.
An official committee of unsecured creditors is formed by the Office of the United States Trustee and typically includes from 5 to 9 of the company’s largest unsecured creditors. This committee hires counsel and gathers and reviews information about the debtor company, including the debtor company activities and financial condition, and participates in the development and negotiation of a chapter 11 plan of reorganization.
A bar date notice is sent out to parties who may have a claim against the company requesting that they submit a “proof of claim” by a specific date.
The company has the exclusive right to formulate a plan of reorganization during the first 120 days of the chapter 11 process which details, among other things, how the company intends to pay its creditors. This plan of reorganization is filed with the Bankruptcy Court along with a disclosure statement. The disclosure statement is a document that contains information concerning the assets, liabilities, and business affairs of the debtor company sufficient to enable a creditor to make an informed decision about the debtor’s plan of reorganization. Once the disclosure statement is approved by the Bankruptcy Court, the company sends out the plan of reorganization along with the disclosure statement to all creditors who are entitled to vote on the plan of reorganization.
After the creditors vote on the plan of reorganization, the company seeks Bankruptcy Court approval of its plan of reorganization. If the plan of reorganization is approved or “confirmed” by the Bankruptcy Court, the company will pay the creditors claims pursuant to the plan of reorganization.
The United States Trustee Program is part of the Department of Justice and seeks to promote the efficiency and protect the integrity of the Federal bankruptcy system. The primary role of the U.S. Trustee Program is to serve as the “watchdog over the bankruptcy process.” The United States Trustee Program monitors the conduct of bankruptcy parties, oversees related administrative functions, and acts to ensure compliance with applicable laws and procedures in order to further the public interest in the just, speedy and economical resolution of cases filed under the Bankruptcy Code.
Specific Responsibilities of the United States Trustees include:
- Taking legal action to enforce the requirements of the Bankruptcy Code and to prevent fraud and abuse;
- Ensuring that bankruptcy estates are administered promptly and efficiently;
- Appointing and convening creditors’ committees in Chapter 11 business reorganization cases;
- Reviewing applications for the retention of professionals and ensuring that professional fees are reasonable; and
- Advocating matters relating to the Bankruptcy Code and rules of procedure in court.
Pursuant to Section 1102(a)(1) of the United States Bankruptcy Code, the Official Committee of Unsecured Creditors, generally referred to as the Creditors’ Committee, was appointed effective March 25, 2019. The Committee appointed generally consists of the holders of the largest claims against the debtors. Its primary functions is to be the negotiating body for the Plan of Reorganization as the representatives of the various types of creditors they represent and provide supervision of the debtors in possession.
The parties appointed to the Creditors Committee are:
Delaware Trust Company
c/o Michele Dreyer, Managing Director
251 Little Falls Drive
Wilmington, DE 19808
Regions Equipment Finance Corp.
c/o Robert Korte, Senior Vice President
2050 Parkway Office Circle, 3rd Floor
Birmingham, AL 35244
Oaktree Capital Management, LP
c/o Jordan Mikes, Senior Vice President
333 South Grand Avenue, 28th Floor
Los Angeles, CA 90071
Helicopter Support, Inc.
c/o Marvin Collins, Manager
Financial Planning & Analysis
124 Quarry Road
Trumbull, CT 06611
Q5-R5 Trading, Ltd.
c/o Scott McCarty, Assistant Secretary
301 Commerce Street, Ste. 3200
Fort Worth, TX 76102-4150
The Unsecured Creditors’ Committee has hired the following professionals to assist it:
Dennis F. Dunne, Esq.
Alan J. Stone, Esq.
Samuel A. Khalil, Esq.
55 Hudson Yards
New York, NY 10001-2163
Telephone: (212) 530-5000
Facsimile: (212) 530-5219
HAYNES AND BOONE, LLP
Ian T. Peck, Esq.
Stephen M. Pezanosky, Esq.
David L. Staab, Esq
2323 Victory Avenue, Suite 700
Dallas, TX 75219
Telephone: (214) 651-5000
Facsimile: (214) 651-5940
Andrew M. Leblanc, Esq.
1850 K. Street NW, Suite 1100
Washington, DC 20006
Telephone: (202) 835-7500
Facsimile: (202) 263-7586
The meeting of creditors under Section 341 of the Bankruptcy Code was held on April 23, 2019 at 11:00 a.m. (CT) at the Office of the United States Trustee, 1100 Commerce Street, Dallas, Texas 75242. At this meeting, representatives of the Debtors appeared and submitted to an examination under oath. The purpose of the examination was to learn of the liabilities and financial conditions of the Debtors, the operation of their businesses, and their prospects for reorganization.
IN THIS CASE, PROOFS OF CLAIM MAY BE FILED EITHER ELECTRONICALLY OR BY HARD COPY PRIOR TO THE DEADLINE ESTABLISHED BY THE BANKRUPTCY COURT
The Bankruptcy Court has set the following deadlines for filing proofs of claim against the Debtors:
General Bar Date (all creditors other than Governmental Units): June 24, 2019 at 4:00 p.m. (CT)
Governmental Unit Bar Date: September 10, 2019 at 4:00 p.m. (CT)
Proof of claim may be submitted online through the electronic interface for filing Proofs of Claim at the following link: https://cases.primeclerk.com/phi/EPOC-Index or through the Court's online Proof of Claim filing system at the following link: https://ecf.txnb.uscourts.gov/cgi-bin/autoFilingClaims.pl
Completed forms can be sent to the following address:
PHI, Inc. Claims Processing Center
c/o Prime Clerk LLC
850 Third Avenue, Suite 412
Brooklyn, NY 11232
T: (844) 216-8745
Please click here to download a Proof of Claim Form.
Proofs of Claim sent by facsimile or e-mail transmission will NOT be accepted, with the exception of Proofs of Claim submitted through the Electronic Filing System as indicated above.
The company has the exclusive right by law to propose a plan of reorganization during the first 120 days of the chapter 11 process which plan of reorganization details, among other things, how the company intends to pay its creditors. The plan of reorganization is filed with the bankruptcy court along with a disclosure statement. The disclosure statement is a document that contains information concerning the assets, liabilities, and business affairs of the debtor company sufficient to enable a creditor to make an informed decision about the debtor’s plan of reorganization. Once the disclosure statement is approved by the bankruptcy court, the company sends the plan of reorganization along with the disclosure statement to all creditors who are entitled to vote on the plan of reorganization.
On April 1, 2019, the Debtors filed their Plan of Reorganization and the Disclosure Statement related thereto. The Bankruptcy Court will hold a hearing to consider approval of the Disclosure Statement before the Honorable Judge Harlin D. Hale, United States Bankruptcy Judge, at the Earle Cabell Federal Building, United States Courthouse, 1100 Commerce Street, 14th Floor, Courtroom No. 3, Dallas, Texas 75242-1496, on June 5, 2019 at 9:00 a.m. (CT).
Please click here to view the Debtors' Plan & Disclosure Statement.