First Guaranty files disclosure statement and plan, wants to fast track

Chicago, Sept. 8 – First Guaranty Mortgage Corp. filed a combined disclosure statement and Chapter 11 plan, bidding procedures and a proposed expedited calendar for sale procedures in filings with the U.S. Bankruptcy Court for the District of Delaware.

In terms of treatment, the filing currently has the following treatments for unclassified claims:

• Administrative claims with full recovery;

• Debtor-in-possession repo loan claims in the amount of $53,655,159 with a full recovery;

• Cash flow DIP claims in the amount of $35,048,628 with an estimated recovery of 10% to 35%, but unclassified and not entitled to vote;

• Priority tax claims would be fully recovered.

For classified claims, the company outlines:

• Priority non-tax claims would be fully recovered;

• Other secured claims would be fully recovered;

• Secured prepetition claims of approximately $557,617,115 would have an estimated recovery of around 90% to 95%;

• Loan settlement claims are yet to be determined;

• Prepetition LVS II offshore guaranty claims in the amount of $25 million would not be recovered but will receive a pro rata share of the liquidating trust;

• General unsecured claims would receive a pro rata share of the liquidating trust; and

• Interests would have no recovery.

The company proposes a voting record date and a hearing on the solicitation procedures of Sept. 20 with solicitation starting Sept. 23.

The voting deadline would be Oct 14 with a combined hearing on final approval of disclosures and confirmation of the combined disclosure statement and plan hearing on Oct. 31.

All of the classes except the priority non-tax claims, other secured claims and interests would be entitled to vote. The first two classes are presumed to accept the plan and the last class is presumed to reject the plan.

Bidding procedures

First Guaranty plans to sell its assets or a sub-set of its assets.

The stalking horse deadline would be Oct. 7 and the bid deadline would be Oct. 10. An auction is proposed to be held on Oct. 14 with a sale hearing on Oct. 27.

The cash flow DIP lender and DIP Repo Guarantor are deemed to be qualified bidders with the only permitted credit bids.

Shortened notice period

First Guaranty also requested a shortened notice period to establish the bidding procedures, proposing a hearing for Sept. 20 and objections due by Sept. 15.

The Plano, Tex.-based mortgage lender filed Chapter 11 bankruptcy on June 30 under case number 22-10584.

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