The "QUEEN MARY" bankrupcy saga carries on...
| LONG BEACH --The Queen Mary's operator has asked for two more weeks to come up with a plan to emerge from bankruptcy, claiming it has four potential partners willing to pay its debts and develop land around the ship.
Queen's Seaport Development Inc. asked for the extension in an effort to continue those talks and avoid a looming Friday deadline to submit its reorganization plan.
Joseph Eisenberg, QSDI's attorney, said that Judge Vincent Zurzolo has approved the request, which was made Tuesday. But official court records had yet to reflect the approval Wednesday. In seeking the extension, QSDI argued that a weeklong Chinese banking holiday has tied up negotiations with a potential Asian investor, and that the Jewish High Holidays and Columbus Day have held up talks with others.
"I think we have very good suitors, as I call it, and I think we need a little more time to properly evaluate them all,'' said Joseph Prevratil, QSDI's president and CEO.
In its court filing, the company said it has four potential suitors willing to steer the company out of bankruptcy.
QSDI filed for bankruptcy protection in March after a lengthy dispute with the city of Long Beach, which owns the Queen Mary and its surrounding 55 acres.
City officials claim the company defaulted on its 66-year lease to run the ship and develop the land by taking more than $4 million in inappropriate rent credits since 2001.
QSDI disputes the city's conclusion, saying the credits were allowed by the lease.
The city is one of dozens of creditors, however, claiming that QSDI owes them money. The largest creditor is Northern California investor Barney Ng, who has loaned QSDI more than $24 million in recent years to spark development at the site and keep the Queen Mary a viable attraction. QSDI has until Friday to submit its reorganization and development plan, after receiving an earlier 90-day extension. The latest extension request would give QSDI until Oct. 28 to present its plan. If the company fails to produce a plan, any group will be eligible to file a plan for Zurzolo to consider. In its court filing, QSDI said its board of directors has met seven times in the last 10 days to discuss and analyze the four potential reorganization proposals.
Prevratil declined to provide details about the investors or their potential development plans. But in the court filing, the company said ÔÔcertain of the four suitors are Asian investors.'' A seven-day banking holiday in China has held up negotiations with that suitor, the filing said. A second suitor appears to be a new limited liability company involving one of QSDI's minority shareholders, Bandero LLC. Bandero, which owns 24 percent of QSDI, and Prevratil have been at odds since the bankruptcy filing.
Bandero's attorneys have previously suggested their clients would consider submitting a reorganization plan of their own. On Wednesday, attorney Vincent Coscino said that Bandero now owns 49 percent of the newly formed Queen Mary Partners LLC, which has submitted a plan to Prevratil. He declined to identify the remaining owners.
Coscino said Bandero hopes that Prevratil will select the Queen Mary Partners' proposal for submittal to the judge. If Queen Mary Partners is not selected, Bandero may still submit a reorganization plan of its own, he said. Bandero would need approval from the judge to submit such a plan for consideration.
Reorganization plans have been in flux for months. In August, QSDI asked Zurzolo to allow a $30 million short-term loan to attract another potential investor. The judge later denied the request." |
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