Hawker Beechcraft, Inc., an airline manufacturer headquartered in Wichita, Kansas, filed a chapter 11 petition for reorganization under the federal bankruptcy code in New York City on Thursday, May 3, 2012. The announced purpose of the filing is to implement an agreed “comprehensive financial restructuring.” In essence, the agreement will convert all of the company’s secured bank and bond debt to equity.
In a ruling on February 29, 2012, the U.S. Bankruptcy Court for the Central District of Illinois allowed a bankruptcy trustee to avoid an Illinois mortgage as to other creditors of the estate because the mortgage failed to expressly state the maturity date of and interest rate on the underlying debt (In Re Crane, Case 11-90592, U.S. Dist Ct, C.D. IL, February 29, 2012).
Introduction
Summary
Recent court decisions in the state of Michigan—Wells Fargo Bank, NA v. Cherryland Mall, ____ N.W.2d _____, 2011 WL 6785393 (Mich.App. 2011) (Cherryland) in the Michigan intermediate appellate court and 51382 Gratiot Avenue Holdings Inc. v. Chesterfield Development Company, 2011 U.S. Dist. LEXIS 142404 (E.D. Mi. Dec.
Summary
In re Nance Properties, Inc., Case No. 11-06197- 8-JRL (Bankr. E.D.N.C. Nov. 8, 2011)
CASE SNAPSHOT
Prepayment provisions are intended, in part, to protect lenders in a depressed market from losses resulting from the costs of replacing their loans sooner than expected and having to relend at rates lower than those originally charged. A New York federal district court recently upheld a bankruptcy judge's ruling denying a lender's claim for a $7.5 million prepayment premium against a borrower-debtor.1 The lender must have been both surprised and disappointed to learn from the courts' decisions that this result could have been avoided had the lender's loan documents included
Although 2011 saw major decisions concerning many facets of bankruptcy law, perhaps no area of bankruptcy law drew as many high-profile decisions as the standards for confirming a chapter 11 plan of reorganization. We draw your attention to three particularly important 2011 decisions that are likely to heavily influence the contours of many future chapter 11 plans.
Designating Votes Not Cast in Good Faith
Many experienced business people are now familiar with the process by which their valid and successful debt collection efforts result in liability under the preference provisions of the Bankruptcy Code.