End may be in sight with proposed liquidation plan for RDAG bankruptcy

End may be in sight with proposed liquidation plan for RDAG bankruptcy
(Source: KCBD)

LUBBOCK, Texas (KCBD) - The attorneys for Reagor-Dykes Auto Group filed a second amended Chapter 11 bankruptcy plan of liquidation for the fallen auto giant.

The plan will shut down the remaining business operations, sell off everything that is left, and will hand over the consumer issues to a creditors trustee and the consumer ombudsman. The plan also supports the settlement with Rick Dykes.

The company filed for bankruptcy on Aug. 1, 2018. The court hearing to decide whether the Reagor-Dykes estate stays in reorganization or is liquidated under Chapter 7 bankruptcy law was continued until March 24, 2020.

This new plan is only for the bankruptcy case for Reagor-Dykes Auto Group and has nothing to do with the criminal cases that have been filed in Federal Court.

The second amended chapter 11 bankruptcy plan will “effect an orderly wind down” of RDAG business operations, will liquidate all assets, and transfer of all causes of action to the creditors trust. The business operations include the resolution to the 108 consumer title issues.

The terms of the plan state a creditors trust will be established and the creditors trustee will be appointed upon confirmation of the plan.

The following are details of the plan and treatment of claims:

All Assets, including Causes of Action, all rights to challenge the extent, priority and validity of alleged liens, and all Collateral not surrendered under the terms of this Plan will be transferred to the Creditors Trust and the Creditors Trustee.

All Holders of Allowed Administrative Claims will be paid from liquidation proceeds in their relative priorities, consumers will reap the benefits of the Consumer/Dykes Settlement and the services of the Consumer Ombudsman, all Holders of Allowed Unsecured Claims will receive a beneficial interest in the Creditors Trust equal to the pro rata amount of their Allowed Unsecured Claim, and the Creditors Trustee will make distributions to all Allowed Unsecured Claims in Class 11 pursuant to the terms and conditions of this Plan and a Creditors Trust Agreement.

Ford Credit’s Allowed Secured Claim will be paid in full by surrender of Collateral.

Ford Credit’s Unsecured Claim is a Disputed Claim. To the extent Allowed, Ford Credit’s Unsecured Claim will be treated in Class 12 and paid as follows: In full and final satisfaction and release of all Ford Credit’s Unsecured Claims against the Debtors, Ford Credit will receive its Pro Rata Share of the Creditors Trust Assets. All Causes of Action against Ford Credit are reserved under this Plan.

GM Financial’s Allowed Secured Claim will be paid in full by surrender of Collateral.

GM Financial’s Unsecured Claim is a Disputed Claim. To the extent Allowed, GM Financial’s Unsecured Claim will be treated in Class 13 and paid as follows: In full and final satisfaction and release of all GM Financial’s Unsecured Claims against the Debtors, GM Financial will receive its Pro Rata Share of the Creditors Trust Assets. All Causes of Action against GM Financial are reserved under this Plan.

Pursuant to that certain Expedited Motion for Approval of Compromise and Settlement with First Bank & Trust Texas, N.A. and the Order Granting Expedited Motion for Approval of Compromise and Settlement with First Bank & Trust Texas, N.A. entered thereon by the Court on November 18, 2019, the liens alleged to secure FB&T’s claims against the Debtors are treated as avoided by consent, FB&T’s claims are subordinated to the claims of all other creditors of the Estates, and FB&T will receive no distribution under this Plan. All Causes of Action against FB&T are released under this Plan.

Pursuant to that certain Motion for Approval of Compromise and Settlement with Vista Bank Pursuant to Bankruptcy Rule 9019 and For Settlement Related Bar Order, Vista Bank’s claims are subordinated to the claims of all other creditors of the Estates, and Vista Bank will receive no distribution under this Plan. All Causes of Action against Vista Bank are released under this Plan.

The Creditors Trust shall make distributions to Holders of Allowed Class 11 Unsecured Claims of their Pro Rata Share (calculated together with Allowed Claims in Classes 12, 13, and 15) of the Creditors Trust Assets. All Causes of Action not otherwise compromised, settled and released pursuant to this Plan are hereby preserved.

The second amended Chapter 11 bankruptcy plan is subject to approval by the court.

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