The company also announced that it will attempt to sell most of its
assets or the stock of its subsidiaries to a local investor and secure
debtor-in-possession (DIP) financing from that investor pending the
negotiation and consummation of the sale, all of which would be subject
to bankruptcy court approval. NuMED is in the business of
providing health care management services to home health care providers,
primarily through the operation of its subsidiaries.
Court Overturns Ruling Against Sears
The 5th U.S. Circuit Court of Appeals on Monday handed a setback to
plaintiffs who had sued Sears, Roebuck & Co. over collection
practices, according to the Associated Press. The court overturned
a ruling by a federal judge in South Texas that the plaintiffs, all
people who had filed for bankruptcy protection from creditors, could
file a class-action lawsuit against the giant retailer. The
plaintiffs accused Sears of violating a mishmash of federal laws
regarding bankruptcy, fraud, fair debt collection and truth in
lending.
The plaintiffs include people who bought goods at Sears on credit,
declared bankruptcy and later either made payments to Sears, had
property repossessed or incurred costs due to Sears' collection
efforts. The consumers accused Sears of using several illegal
practices to recover payment on debt that was wiped away by
bankruptcy.
United Companies to Exit Chapter 11
United Companies Financial Corp. yesterday announced that it has
entered an order confirming the debtors' fourth amended reorganization
plan in the U.S. Bankruptcy Court for the District of Delaware in
Wilmington, according to a newswire report. The bankruptcy court
preliminarily approved the plan last Friday. The terms of the
liquidating plan, provide for bank loan claims totaling $857.9 million
to receive a recovery estimated at 83.7 percent, senior note claims
totaling $238.9 million to receive a recovery estimated at 48.4 percent,
and general unsecured claims estimated at $30 million to receive a
recovery of 40 percent. Holders of the debtors' subordinated debenture
claims totaling $158 million will receive a cash payment of $2.5
million. The plan also provides for the establishment of a litigation
trust.
United Companies, a Baton Rouge, La.-based finance company,
anticipates that the plan will become effective this month. The
company filed for chapter 11 on March 1, 1999.
T & W Financial Files for Bankruptcy and Plans
Liquidation
T & W Financial Corp. yesterday announced that the Tacoma,
Wash.-based company and its operating subsidiary T & W Financial
Services Company LLC filed voluntary chapter 11 on Oct. 31, according to
a newswire report. The cases are pending in the U.S. Bankruptcy
Court for the Western District of Washington in Seattle.
Crown Vantage Enters Issues Letter of Intent to Sell Specialty
Business
Crown Vantage Inc. and its wholly owned subsidiary, Crown Paper Co.,
yesterday announced that Crown Paper has signed a letter of intent with
KPS Special Situations Fund LLC (KPS) for the sale to KPS or its
designee of the specialty, packaging, text and cover papers business of
Crown Paper, according to a newswire report.
The consideration for the purchase of the assets is $17.5 million in
cash and a $7.5 million note payable in seven years, with interest
payable in cash or additional notes at the option of the purchaser. In
addition, if the purchaser subsequently sells certain assets above a
threshold level, under certain specific conditions, Crown Paper will be
entitled to share in the proceeds of any such sale. The purchaser has
also agreed to assume certain liabilities of Crown Paper arising after
the filing of the chapter 11 case. Crown Vantage, based in
Cincinnati, is a manufacturer of value-added papers for printing,
publishing and specialty packaging.
