Petra funds file Chapter 11 plan to distribute remaining assets

By Caroline Salls

Pittsburgh, Feb. 18 - Petra Fund REIT Corp. and Petra Offshore Fund, LP filed their plan of reorganization and related disclosure statement Thursday with the U.S. Bankruptcy Court for the Southern District of New York.

A liquidation trust will be established under the plan if not all of the companies' assets are converted to cash before the effective date.

According to the disclosure statement, the funds' remaining assets include $500,000 in cash, settlement payments, class F, G and J bonds, the equity interests of PS SPV, which owns class K bonds and CDO preferred shares, and asset sale proceeds.

Treatment of creditors will include:

• Holders of administrative claims and priority tax claims will be paid in full in cash;

• JPM and RBS secured claims will be exchange for new debt;

• Holders of other secured claims will be paid either from liquidation trust funds or the companies' assets after all administrative and priority claims and liquidation trust expenses have been paid in full;

• Holders of general unsecured claims will receive a share of distributable assets within 120 days of the plan effective date and then annually thereafter, with a total payment equal to 100% of their claims.

If a liquidation trust is not created, these creditors will receive a share of remaining assets after payment of administrative, priority and other secured claims; and

• Interests will be cancelled, and holders will receive no distribution.

Petra Fund REIT is a New York-based real estate investment trust. The companies filed for bankruptcy on Oct. 20. The Chapter 11 case number is 10-15500.

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