MPC Computers eyes approval of settlement agreement with Gateway

By Lisa Kerner

Charlotte, N.C., Oct. 5 - MPC Computers, LLC asked the court to approve a settlement by and among MPC, Gateway, Inc., Gateway Technologies, Inc., MPC Corp., GTG PC Holding, LLC, MPC-G, LLC, MPC Solution Sales, LLC, MPC-Pro, LLC, Gateway Cos. Inc., Gateway Pro Partners, LLC and Gateway Professional, LLC and the official committee of unsecured creditors, according to a Tuesday filing with the U.S. Bankruptcy Court for the District of Delaware.

The settlement proposes:

• A mutual general release of all claims of the opposing parties;

• A settlement payment to Gateway by the debtors of $5.65 million;

• Gateway's entitlement to 45% of the net proceeds, less costs of collection including reasonable attorneys fees, of the accounts receivable of MPC-Pro, obtained from May 31, 2010 until the entry date of a final decree in the debtors' bankruptcy cases;

• Assignment to Gateway of all warranty claims of the debtors relating to extended warranties for Gateway-branded products sold prior to Oct. 1, 2007; and

• The allowance of Gateway's unsecured deficiency claim against the debtors' estates in the amount of the Gateway claim, less the settlement payment and Gateway's receipt of certain proceeds of MPC-Pro's accounts receivable.

A hearing is proposed for Oct. 18.

MPC, a major U.S. PC vendor since 1991, provides enterprise internet technology hardware services to mid-sized businesses, government agencies and education organizations. The company filed for bankruptcy on Nov. 6, 2008. Its Chapter 11 case number is 08-12667.

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