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Hobbico Chapter 7 Conversion Sought

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Hobbico filed with the U.S. Bankruptcy Court a motion to convert its Chapter 11 case to a Chapter 7 case. The conversion motion explains, “In accordance with the Bidding Procedures Order, an auction was held on March 28, 2018, and continued and concluded on April 12, 2018.  As a result, the Debtors have now sold all of their operational assets of any meaningful value. While the Debtors have taken several steps since closing the Sale to wind-up their estates, at this point the Debtors do not believe that their estates will continue to benefit by remaining in chapter 11. Accordingly, the Debtors submit that these chapter 11 cases should be converted to chapter 7. In addition, the Debtors have insufficient funds to confirm a chapter 11 plan of reorganization. With the cessation of operations and no significant tangible assets left to administer, a successful rehabilitation under the auspices of chapter 11 of the Bankruptcy Code is not possible.  Thus, drawing out the chapter 11 process will result in additional administrative expense with little or no benefit to the Debtors’ estates, and the Debtors believe that conversion of these chapter 11 cases to cases under chapter 7 of the Bankruptcy Code will maximize residual value for the benefit of all stakeholders.” The Court scheduled a July 11, 2018 hearing to consider the conversion motion with objections due by July 5, 2018.

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The post Hobbico Chapter 7 Conversion Sought appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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