Grandparents.com filed with the U.S. Bankruptcy Court a motion to compromise controversy with VB Funding.
The motion explains, “The Debtors seek approval of a settlement reached with VB Funding, which will result in a distribution to general unsecured creditors which in all circumstances will be no less than 8% higher than if this settlement was not achieved. The settlement could permit those distributions to approach 80%….Based upon the Debtors’ evaluation of: (i) the Estates’ and VB Funding’s arguments as to certain lien rights; (ii) the anticipated costs that will be incurred in connection with that dispute; (iii) the estimated amount of allowed claims against the Estates and the guaranteed recovery to same which the Settlement permits; and (iv) the costs and risks to the Estates associated with continued litigation at both the trial and appellate levels, the Debtors believe that the Settlement should be approved.”
In addition, “The terms of the Settlement are: VB Funding has contributed $200,000 to the Debtors to wind down and otherwise administer the remaining assets in the Estates. VB Funding has funded $50,000, specifically earmarked for a general unsecured creditor distribution. VB Funding, which has an allowed claim in the amount of $9,188,537.96, shall waive its lien on any assets of the Estates and Liquidating Trust. VB Funding will receive the first $300,000 of any net proceeds from any net litigation recovery by the liquidating trust. The general unsecured creditors will receive the next $450,000 of the net proceeds of any litigation claims.”
The Court scheduled a September 15, 2017 hearing to consider the motion.
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