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Zohar III Bankruptcy Trustee, Examiner Sought

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The U.S. Trustee filed with the U.S. Bankruptcy Court a motion for the appointment of a Chapter 11 trustee or, in the alternative, an examiner to the Zohar III case.

The motion explains, “Cause exists to appoint a chapter 11 trustee under section 1104(a) of the Bankruptcy Code because the debilitating and entrenched acrimony among the Debtors and their creditors, including MBIA Insurance Corporation, the Zohar III Controlling Class, and Alvarez &Marsal Zohar Management, LLC (collectively, the ‘Creditors’) is impeding the reorganization process, and the appointment of a trustee may be the only effective way to pursue reorganization. Appointment of a chapter 11 trustee would also be in the best interests of creditors, equity security holders, and other interests of the estate, because the Debtors’ director has exhibited a lack of diligence and an inability to fulfill the fiduciary duties imposed on management of a chapter 11 debtor-in-possession.”

In addition, “Creditors, as well as investors, require an independent, conflict-free, and experienced fiduciary to manage the Debtors, unravel their financial affairs, recover assets, and determine appropriate litigation and reorganization strategies. In the alternative, if a chapter 11 trustee is not appointed, the record supports the appointment of an examiner under section 1104(c) of the Bankruptcy Code.” The motion also seeks shortened notice and consideration.

Read more Zohar bankruptcy news.

The post Zohar III Bankruptcy Trustee, Examiner Sought appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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