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Midway Gold Objection Filed

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The U.S. Trustee (UST) assigned to the Midway Gold case filed with the U.S. Bankruptcy Court an objection to the Company’s Disclosure Statement related to the Plan of Reorganization.

The Trustee asserts, “The Debtors’ stock has been delisted in Canada and the United States. Debtors should disclose whether it has any pending securities law defaults, such as delinquent 10-K filings. Pages 3 and 11 of the Statement are also not consistent. Page 3 implies delisting in both Canada and the United States, whereas page 11 implies that only the New York Stock Exchange and not the Toronto Exchange has delisted the stock. More detail should be provided about the status of the Canadian reorganization proceeding. Debtors’ statement that ‘more than 200 hundred proofs of claims have been filed’ appears to be a typographic error which should be corrected. The Debtors’ discussion about the EPC Services Adversary Proceeding should discuss how the disputed claims will be resolved if the bankruptcy court lacks jurisdiction to decide those issues or chooses to abstain from deciding them.”

The objection continues, “The pertinent issues appear to be governed only by Nevada state law which raises justifiability issues. Some estimate of the professional fees should be provided. The Current designation as ‘undetermined’ is not adequate. Further background should be provided about the Golder Associates Claims settlement and the propriety of affording this creditor a different treatment than other mechanics lien claimants. The Debtors should provide far more detail about the selection of the Liquidating Trustee and Liquidating Trust Committee, particularly addressing any conflicts of interest. The UST asserts that the Committee and Trustee should be selected pre-confirmation and creditors provided disclosures about the identity, qualifications, compensation, estimated costs and contact information.”

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