Club Ventures expects to emerge from Chapter 11 by end of October

By Lisa Kerner

Charlotte, N.C., Sept. 23 - Club Ventures Investments, LLC's second amended plan of reorganization was confirmed by the U.S. Bankruptcy Court for the Southern District of New York.

The plan allows the company to reduce its debt by about two-thirds, according to a company news release.

Club Ventures said it anticipates emergence from Chapter 11 protection on or about mid-October.

As previously reported, Club Ventures filed an amended plan on Sept. 20 that did not change the treatment of creditors but specified that the plan's effective date will be on or before Oct. 31.

Under the proposed plan of reorganization, treatment of creditors will include the following:

• Holders of priority tax claims, administrative claims and non-tax priority claims will be paid in full in cash;

• The Bank of America secured claim will be reinstated, provided, however, that the company's deadline for repaying all principal and interest on the Bank of America loan will be extended to Sept. 15, 2012.

• Bank of America cannot declare a default or accelerate the loan until that date if the company makes its monthly interest payments;

• The holder of the LBN secured claim will receive LBN notes and reimbursement obligations and new membership interests;

• The holders of the Praesidian secured claim will receive Praesidian notes and new membership interests;

• Holders of other secured claims will be reinstated, be paid in full in cash or receive the collateral securing the claims;

• Member unsecured claims, insured claims and subsidiary debtor interests will be reinstated;

• Convenience claims, which are unsecured claims of $250 or less, will be paid in full in cash;

• Holders of general unsecured claims will receive a share of a general unsecured claim distribution;

• All insured claims will be reinstated;

• Holders of subordinated claims will receive no distribution;

• Interests in subsidiary debtors will be reinstated; and

• Holders of series A and series B preferred interests and class A, class B and class C interests will receive no distribution.

Club Ventures, a New York-based operator of upscale health clubs, filed for bankruptcy on March 2. Its Chapter 11 case number is 11-10891.

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