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Trump, noteholders reject equity committee's attempt to disqualify UBS
By Jeff Pines
Washington, Jan. 21 - Trump Hotels & Casino Resorts Inc. and the Trump Atlantic City noteholders objected to an emergency move by the equity committee to eliminate UBS Securities LLC from testifying on the company's post-petition financing motions. They accused the equity committee of trying to derail or at least delay the company's reorganization.
UBS is not advising the company while it is in bankruptcy but helped it before the Trump company filed for bankruptcy. The company wants final approval for a $100 million debtor-in-possession financing facility and the use of cash collateral.
Both the company and the committee said UBS is intimately familiar with Trump Hotels & Casino Resorts' position and that UBS helped the company with structuring and negotiating the DIP. In addition, UBS will not be paid for its testimony. The investment bank has agreed to act as joint-lead arranger and bookrunner for the exit financing proposed in the reorganization plan.
In its emergency motion, the equity committee accused the company of trying to circumvent the bankruptcy code by not employing UBS, saying that paying UBS before filing for bankruptcy and then paying it after for exit financing is an "elaborate artifice" to get around the rules governing professionals under the bankruptcy code.
The committee wants UBS' testimony excluded unless the company asks the court for permission to retain its services.
The hearing is scheduled for Jan. 21.
Trump Hotels & Casino Resorts filed for bankruptcy on Nov. 21 in the U.S. Bankruptcy Court for the District of New Jersey. The company's Chapter 11 case number is 04-46917.
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