Bankruptcy News

We've summarized the latest docket activity and news for publicly traded companies currently operating under U.S. Bankruptcy Court protection.

Bankruptcy/Chapter 11 / Banks

Mercantile Bancorp Plan Filed

Mercantile Bancorp filed with the U.S. Bankruptcy Court a Chapter 11 Plan of Liquidation and related Disclosure Statement. According to the Disclosure statement, “On February 24, 2014, the Debtor filed the Plan with the Bankruptcy Court to facilitate the liquidation of the Debtor’s Estate and the Distribution of the Assets to holders of Allowed Claims. The Debtor believes that the Plan provides the best recoveries possible for holders of Allowed Claims and strongly recommend that, if such holders are entitled to vote, they vote to accept the Plan. Pursuant to section 1141(d)(3) of the Bankruptcy Code, the Plan does not contain a discharge for the Debtor as the Plan is a liquidating plan and the Debtor will not be engaging in business after the consummation of the Plan. Therefore, the Debtor is not entitled to a discharge under section 727(a) of the Bankruptcy Code” According to the Plan, all administrative, priority and other claims will be paid in full in cash on the initial distribution date. Holders of general unsecured claims will be paid distributions from all cash funds remaining in the estate. All equity interests will be cancelled. The Disclosure continues, “If the Plan is not Confirmed, the Chapter 11 Case may be converted to a case under chapter 7 of the Bankruptcy Code, pursuant to which a trustee would be elected or appointed to liquidate the assets of the Debtor for Distribution in accordance with the priorities established by the Bankruptcy Code. The Debtor believes that any such conversion would likely reduce any Distribution to holders of Claims based on, among other things, the (i) increased costs of a chapter 7 case arising from the fees payable to a chapter 7 trustee and professional advisors to such trustee (ii) substantial increases in claims which would be satisfied on a priority basis and (iii) substantially longer period of time that would elapse until distributions could be made under chapter 7.”

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