Pipeline Data's second amended Chapter 11 liquidation plan confirmed

By Jim Witters

Wilmington, Del., Oct 9 - Pipeline Data, Inc.'s second amended Chapter 11 plan of liquidation was confirmed during an Oct. 9 hearing in the U.S. Bankruptcy Court for the District of Delaware.

Judge Kevin J. Carey said he would sign the confirmation order when the debtors submit the final language.

As previously reported, Pipeline Data reached a global settlement in May that resolved claims in the bankruptcy proceeding and litigation pending in the Supreme Court of New York, paving the way for the Chapter 11 plan of liquidation.

The agreement settles a dispute between Camofi Master LDC, acting as collateral agent for some senior convertible secured notes, as the holder of those notes and as attorney-in-fact for Pipeline Data, Inc. and Cynergy Data, LLC; Comvest Pipeline Cynergy Holdings, LLC; and Pipeline Cynergy Holdings, LLC.

The company closed on the $9.75 million sale of substantially all of its assets in March.

Other issues

A hearing on the U.S. Trustee's motion to convert the case to Chapter 7 was delayed, because no attorneys from the trustee's office attended the hearing.

Pipeline attorneys said the trustee's office has been affected by the partial shutdown of the federal government, and no one had returned their calls.

The court also granted final approval of Pipeline's use of cash collateral.

Creditor treatment

Treatment of creditors under the liquidation plan includes the following:

• Administrative expense claims, secured tax claims, priority tax claims and non-tax priority claims will be paid in full in cash;

• Holders of non-insider secured notes claims and insider secured notes claims will be paid in accordance with the global settlement; and

• Holders of general unsecured claims and interests will receive no distribution.

Pipeline Data, a Brashear Falls, N.Y.-based credit card payment processing and merchant services company, filed for bankruptcy on Nov. 19, 2012. Its Chapter 11 case number is 12-13123.

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