Protected Vehicles creditors committee motion for case conversion taken under advisement

By Jennifer Lanning Drey

Portland, Ore., July 17 - Protected Vehicles Inc.'s official committee of unsecured creditors' motion to convert the company's Chapter 11 bankruptcy case to Chapter 7 liquidation was taken under advisement Thursday following a hearing at the U.S. Bankruptcy Court for the District of South Carolina, according to a source who attended the hearing.

During the hearing, judge David Duncan indicated cause exists to convert the case but said he needed to further consider whether case conversion would be in the best interest of the company's creditors, the source said.

An order is expected within the next few days.

As previously reported, the committee filed a prior case conversion request that was denied in a March 25 hearing when the court ruled that the committee had failed to show there was an absence of a reasonable likelihood of rehabilitation.

In the committee's more recent motion for conversion, the creditors argued the case should be converted because the company continues to suffer substantial losses and has not been able to find additional funding sources, a buyer or an investor.

The creditors committee further claimed that Protected Vehicles' estate has been mismanaged because a motion filed by the company for permission to use cash collateral contained significant errors.

Protected Vehicles, a North Charleston, S.C., designer and manufacturer of mine and ballistic protected vehicles, filed for bankruptcy on Feb. 5, 2008. Its Chapter 11 case number is 08-00738.

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