GB Holdings asks court to determine Atlantic Holding stock be credited against debts

By Jennifer Lanning Drey

Eugene, Ore., Sept. 29 - GB Holdings, Inc. asked the court to make a determination that its Atlantic Holding Inc. stock be credited against its debts to secured creditors, according to a Friday filing with the U.S. Bankruptcy Court for the District of New Jersey.

The company wants the stock to be considered a dollar-for-dollar reduction in the claims against GB Holdings' estate, according to the motion.

In the filing the company said the official committee of unsecured creditors' plan provides for a transfer of the Atlantic stock from GB Holdings to a liquidation trust without providing any consideration to the company's estate.

In addition, the company claims any distribution of stock on the plan's effective date would not reduce the unsecured claims owed by GB Holdings.

The company also said that in the event that unsecured claims are fully satisfied from the proposed distribution of stock, the committee plan would violate the best interests of creditors and interest holders.

The stock represents a 28.8% interest in Atlantic Holdings and is GB Holdings' only tangible asset, according to the motion.

GB Holdings owed $46.1 million to certain noteholders when the company filed for Chapter 11, according to the motion.

GB Holdings said resolving the issues related to the Atlantic stock would greatly reduce the costs of administration.

GB Holdings has no operating activities. It filed for bankruptcy on Sept. 29, 2005. Its Chapter 11 case number is 05-42736.

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