BSPV-Plano defends exclusivity; trustee seeks to push back hearings

By Sarah Lizee

Olympia, Wash.., Jan. 23 – BSPV-Plano, LLC defended its exclusive right to file and solicit votes on a Chapter 11 plan in court documents filed Friday with the U.S. Bankruptcy Court for the Eastern District of Texas.

As previously reported, the company has filed a plan, with the disclosure statement hearing scheduled for Feb. 7. Bond trustee Huntington National Bank has asked the court to end the company’s exclusivity so that it can file a competing plan.

“If the bond trustee had had its way at the outset, there would have been a fireside sale, an uncompleted project, and unpaid creditors – including its own two junior classes of bondholders,” the company said Friday.

The debtor said the bond trustee is acting only upon the instructions of senior class A and B bondholders, who owe no duties to the junior class C and D bondholders.

If the bond trustee gets the liquidation that it wants, or rather the class A and B bondholders want, then they alone get all of the upside and equity, the company said.

“That is what is really motivating the motion,” the debtor stated.

The company said because of its efforts and the commitment from insiders, the bond trustee is over-secured, the value of its collateral has increased and is still increasing, and there is more than enough value to pay all claims in full.

Meanwhile, the bond trustee has asked the court to extend the hearing on the motion to terminate exclusivity to Feb. 28 from Jan. 24, and the hearing on the disclosure statement from Feb. 7 to at least two weeks after the motion to terminate is heard.

Huntington said that if the court grants the motion to terminate, creditors should be afforded the right to consider the trustee’s plan at the same time as the debtor’s.

The trustee said the court should consider requiring the parties to file a single, joint disclosure statement describing both plans so creditors won’t be confused by receiving multiple disclosure statements for the same case.

“If the court grants the motion to terminate after the disclosure statement hearing, that relief would not be available,” Huntington said.

“For that reason, the motion to terminate must be heard before a hearing on the debtor’s disclosure statement.”

The Plano, Tex.-based company was formed in May 2018 to acquire, own, develop and operate the Bridgemoor at Plano. It filed Chapter 11 bankruptcy on March 1, 2022 under case number 22-40276.

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