Express Grain disclosure statement OK’d; trustee objection resolved

By Sarah Lizee

Olympia, Wash., Jan. 6 – Express Grain Terminals, LLC received approval of the amended disclosure statement for its Chapter 11 plan, according to documents filed Thursday with the U.S. Bankruptcy Court for the Northern District of Mississippi.

As previously reported, the U.S. trustee had objected to the disclosure statement. The objection was resolved by amending the documents to provide that, among other things, the liquidating trustee’s specified duties and obligations include the obligation to oversee and ensure the filing of post-confirmation monthly operating expenses, and to oversee and ensure the timely payment of U.S. trustee quarterly fees.

It was also amended so that, as to the debtor’s directors, officers, managers or other members of any governing body of the debtor, the term “discharge” relates only to the discharge of the noted individual’s employment and related duties, and does not mean that any debt owed to the debtor by the individuals is forgiven, reduced, eliminated, compromised or settled.

It was further amended to reserve, unto the U.S. trustee, any objection to the exculpation and indemnification provisions of the amended disclosure statement, with the U.S. trustee asserting that they are overbroad, particularly as to the liquidating trustee who has not yet been approved.

Also, UMB Bank has been released from any and all claims that the debtor may have, or may have had, as to the bank in connection with the global settlement that was approved by the court in December.

Settlement terms

As previously reported, the settlement was between the debtor, lenders and promissory noteholders.

On April 11, 2022, Express Grain was given permission to sell all of its assets to UMB. Based on the sale order, there are no material assets with any equity for certain lenders.

Express Grain has settled claims with its lenders, business debtors and entity EGT Leverage.

Leverage loans are not collectible and there is no value to equity interests that were part of related option agreements. Accordingly, leverage loans from 2015, 2018 and 2020 will be canceled with the related option agreements.

When entities Rustic, MuniStrategies, Amcref 47, Amcref 50, New Markets and Heartland receive funds from their respective accounts they will be able to apply the funds to their respective loan documents and the balance of their proofs of claim will be withdrawn and the debtors will disclaim any further interest in those accounts.

The business debtors will release the leverage loan lenders from all causes of action, including avoidance actions.

EGT Leverage will release three investment funds from three leverage loans.

Plan terms

The plan establishes a liquidating trust for the purpose of receiving and liquidating the debtor, its property and assets, and distributing the funds to holders of claims and interests.

Express Grain said in the disclosure statement that there currently isn’t enough cash to pay for the administrative expense claims and priority claims in full at confirmation. However, the claims will be paid as and when cash is available to pay them.

The secured claims of Bank of the West, BankPlus, CAT Financial and Chase Auto have already been paid in full.

UMB Bank NA asserts liens on various proceeds, and there may also be certain assets that are subject to the UMB lien that were not sold. The company said it will continue to liquidate those assets and pay the funds that UMB is entitled to on or before the effective date of the plan and thereafter as funds become available and are not used otherwise.

Unsecured convenience claims totaling less than $2,500 will be paid in full in cash on the effective date at the rate of 15% of the allowed amount of those claims.

Unsecured creditors will receive, upon the final distribution in the case, all remaining cash which has not been used to pay prior classes.

Equity security interests will be canceled.

Greenwood, Miss.-based Express Grain Terminals is an agricultural processing and marketing company. It filed bankruptcy on Sept. 29, 2021 under Chapter 11 case number 21-11832.

© 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.