As Sundance starts and sends excitement throughout the town, there is another reason for some to be excited….the parties involved in the Promontory bankruptcy case have all agreed on the reorganization plan! Here is the letter from the legal team to members:
I’m happy to tell you that Promontory’s lawyers advised the Bankruptcy Judge this morning that Promontory, Pivotal, Credit Suisse, and the Creditors Committee have all agreed to the terms of a reorganization plan. And they have all agreed to continue Pivotal’s financing of Promontory through April, 2009.
Under the proposed plan – if it is approved by the Court – the club membership agreements, lot purchase agreements and related development agreements will be assumed and reinstated, and Promontory should be out of bankruptcy in April.
The plan, in very general terms, provides that the Credit Suisse lender group will take ownership of Promontory in March (we expect that many if not most of the key operational employees will be retained), but only if that lender group is able to commit the funds necessary to assume and perform the agreements referred to above. If the lender group is unable to do so, then there will be an auction among potential acquirers who areable to do so. While it has agreed to support this plan, the Committee has retained the right to contest, if necessary, the lender group’s (or any auction bidder’s) ability to assume and perform those agreements. In the Committee’s view, that ability is the most important qualification for Promontory’s ownership going forward.
The agreement among Promontory, Credit Suisse, Pivotal, and the Committee will be posted on the Committee’s website, www.promontorycommittee.com, by the close of business this afternoon. A proposed disclosure statement, which will describe the proposed plan in detail, will be posted on the website as soon as it is filed in Court. That will probably be next Thursday. There will be a Bankruptcy Court hearing near the end of January on the adequacy of the disclosure statement. If it is approved, then it and the proposed plan will be distributed to voting creditors early in February. After the votes are counted, the proposed plan would then be presented to the Bankruptcy Court for confirmation in mid-March. The exact dates for these events will also be posted on the Committee’s website as soon as they are calendared by the Bankruptcy Court.
The bottom line is this: Promontory has the necessary financing to operate comfortably through April, as the golf season ramps up. And the four most actively involved parties in this bankruptcy case – Promontory, Credit Suisse, Pivotal and the Committee – have all agreed to the terms of a reorganization plan that can be confirmed by then. And the plan they have agreed on provides for Promontory to emerge from bankruptcy with its membership rights and amenities intact and significantly less debt on its books. Given current economic conditions, in the Committee’s view, this has the potential to be a very good result for our community.
This sounds good to me…We will see how things take shape though. I would imagine Credit Suisse will run the club on auto-pilot for a while with the same employees that are there now. Then try to either get a club operator in there, or just sell it when the economy starts to turn around.
P.S. there is not a soul on the slopes, no lift lines, and great snow!!!
Things to Consider...
- Promontory’s Bankruptcy Plan Amended
- Promontory Reorganization Plan Confirmed by Bankruptcy Court
- Promontory Club Bankruptcy Update
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