ShoreBank's amended joint plan of liquidation effective as of Friday

By Caroline Salls

Pittsburgh, June 29 - ShoreBank Corp.'s amended joint plan of liquidation took effect on June 29, according to a filing with the U.S. Bankruptcy Court for the Northern District of Illinois.

The plan was confirmed on June 13.

As previously reported, the plan is based on a settlement under which the Federal Deposit Insurance Corp. will receive $8.5 million of a federal income tax refund in exchange for its receivership claims.

The plan calls for the liquidation of ShoreBank's remaining assets and distributions of proceeds to creditors.

Treatment of creditors

Under the confirmed plan, creditor treatment includes:

• Secured claims will be paid in cash or reinstated;

• Non-tax priority claims will be paid in full;

• The FDIC will receive the $8.5 million federal income tax receivable;

• Holders of senior debt claims will receive an interest in the company's liquidating trust and subordinated notes redistribution interests;

• Holders of general unsecured claims will receive a liquidation trust interest;

• Holders of subordinated notes claims are not expected to receive a distribution; and

• Holders of other subordinated claims and old equity interests will receive no distribution.

Chicago-based ShoreBank is a bank holding company. The company filed for bankruptcy on Jan. 9 under Chapter 11 case number 12-00581.

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