Regent Files Objection To Creditor's Equity Committee Proposal
April 5, 2010 at 1:01 PM (PT)
REGENT COMMUNICATIONS has filed an objection to deny creditor RESILIENT CAPITAL MANAGEMENT's motion to appoint an Equity Committee in its bankruptcy case.
The motion was filed FRIDAY (4/2) in U.S. Bankruptcy Court in DELAWARE and raises several issues with RESILIENT's request, saying that REGENT is "not seeking to deny Resilient or any other equity holder its day in court. Rather, in connection with the Confirmation Hearing, the Debtors stand prepared to litigate, if necessary, the very issue that lies at the heart of the Motion — valuation. At the Confirmation Hearing, the Debtors will present evidence and testimony in support of their financial advisors’ valuation, which shows conclusively that equity interests are out of the money and that the Plan can and should be confirmed."
The lengthy objection tells the court that RESILIENT has "not shouldered the heavy burden to demonstrate that an equity committee is appropriate in these Chapter 11 cases," specifically not having established any likelihood that shareholders "will receive a meaningful distribution from the Debtors’ estates other than the gift from the prepetition secured lenders," and that the shareholder's interests "have been vigorously represented prior to and throughout these Chapter 11 Cases. Ironically, RESILIENT’s own actions may jeopardize the gift to equity that management and the Board of Directors fought to obtain."
A hearing on the confirmation of REGENT's reorganization plan and on RESILIENT's motion will be held FRIDAY (4/9).