Education Resources Institute, creditors committee file joint plan

By Caroline Salls

Pittsburgh, Sept. 23 - The Education Resources Institute, Inc. and its official committee of unsecured creditors filed a joint plan of reorganization Tuesday with the U.S. Bankruptcy Court for the District of Massachusetts.

A plan trust will be established for liquidation and distribution of the company's assets for the benefit of holders of general unsecured claims.

TERI said a minimum of $36 million in available cash will be transferred to the trust on the plan effective date. The plan is required to take effect by Dec. 31.

Under the plan:

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

• If the creditors committee does not exercise a plan proponent settlement withdrawal election, holders of make and wait lender claims will receive distribution under a make and wait lender settlement unless they choose the make and wait lender election. If they choose the lender election, creditors will receive an alternative make and wait lender treatment.

If the committee does exercise the withdrawal election, these creditors will receive the collateral securing their claims to the extent that the court determines that the claim is an allowed secured claim;

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

• Holders of convenience claims will be paid in full from available cash;

• Holders of securitization trust claims who vote to accept the plan will be treated in accordance with a securitization trust settlement.

Holders of these claims who vote to reject the plan will be deemed to have opted out of the settlement and will have their claims litigated in the bankruptcy court after entry of the confirmation order; and

• Holders of non-securitization trust general unsecured claims will receive a share of distributions on account of a $4 million master trust assigned claim and securitization trust distribution account.

TERI, a Boston non-profit access-to-education promoter, filed for bankruptcy on April 7, 2008. Its Chapter 11 case number is 08-12540.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.