First NBC Bank plan effective date deadline extended to Jan. 29

By Sarah Lizee

Olympia, Wash., Nov. 12 – First NBC Bank Holding Co. received court approval of an extension of its deadline for obtaining investor funding and of the occurrence of the Chapter 11 plan effective date through Jan. 22 and Jan. 29, respectively, according to a Thursday filing with the U.S. Bankruptcy Court for the Eastern District of Louisiana.

As previously reported, the Department of Treasury objected to the plan in July 2019 in connection with the treatment of its equity interests in the company. The court ruled in favor of the plan proponents and confirmed the plan in May.

The Department of Treasury filed a notice of appeal on May 15.

The plan requires a first round of investments in the amount of $5 million deposited in escrow by Sept. 4. While all first-round investors have placed at least 10% of their investments in the account, the remaining portion of the investment has not yet been deposited as a result of the investors’ concerns related to the appeal.

The company said that it has devoted significant effort toward alleviating investors’ funding concerns to help enable occurrence of the effective date.

After obtaining the consent of the Department of Treasury on Oct. 5, the plan proponents filed a motion to expedite the disposition of the appeal. On Oct. 8, the district court granted the motion to expedite and stated that disposition of the appeal would be considered on an expedited basis. No further orders of the district court have been entered since that time, the debtor said.

First NBC said it also invested a substantial amount of time in seeking additional investors that could potentially facilitate joint plan funding prior to resolution of the appeal. The company believes that the availability of additional funds would reduce the risks of all first-round investors and elicit their agreement to proceed forward with plan funding while the appeal remains pending.

After negotiations with multiple investor groups, the debtor said it now believes that it will be able to secure the requisite investments for joint plan funding within 45 to 60 days, following the new investors’ due diligence period.

First NBC, a New Orleans-based bank holding company, filed bankruptcy on May 11, 2017. The Chapter 11 case number is 17-11213.

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