This message is an update of recent developments in the Richard L. Bruhn case as well as developments in the Dick Bruhn, Inc. case that affect the creditors of Richard L. Bruhn.
LIQUIDATION OF SELIX FORMALWEAR
Over the past few months, it appeared that the Selix Formalwear chain would be sold as a going concern and the sale was set to have gone forward today, January 9, 2008. Unfortunately, we learned yesterday afternoon that the prospective buyer had withdrawn its offer. There are no other prospective purchasers, and Selix will not be sold as a going concern. Instead the chain will be liquidated.
On January 9, 2008, the Court granted a request for an expedited hearing on the matter. (See Motion for Authority to Sell) The hearing on the liquidation will take place next Monday, January 14, 2008 at 3:00 p.m. (See Notice of Hearing) before Judge Efremsky in the San Jose Bankruptcy Court.
PLAN AND DISCLOSURE STATEMENT
There will be no hearing on a proposed Plan and Disclosure Statement on January 10, 2008. The Creditors' Committee filed a Plan and Disclosure Statement in December. However, based on guidance provided by the Court at a hearing in late December, the Committee has elected to withdraw the Plan and Disclosure Statement and take the hearing off of the Court's calendar. The hearing was to have been on Thursday, January 10, 2008. The Committee expects to work collaboratively with the Debtor's attorneys to prepare and file an Amended Plan and Disclosure Statement that addresses various issues of concern raised by the Court. We hope that the hearing on the Amended Plan and Disclosure Statement can be held in February or March.
SETTLEMENT
The estates of DBI and Richard L. Bruhn have been involved in lengthy negotiations over an inter-estate settlement agreement which would resolve all issues between the two estates and presumably facilitate a quicker and larger distribution to the creditors of Richard L. Bruhn. The estates have now reached an agreement in principle on the settlement and will soon be filing a motion to approve the settlement agreement. The Court will likely hold a hearing on the motion to approve the settlement in early February.
SALE OF 300 MAIN STREET, SALINAS
Professionals employed by Donna Bruhn, as conservator for Richard L. Bruhn, have advised that it is most prudent to attempt to sell the Salinas property in the near-term. Reasons for the sale include the state of the current real estate market as well as the fact that there appears to be a buyer interested in the property now. Bruhn filed an Application for Employment of a real estate professional to list the 300 Main Street property. The estate of John Maness filed an Objection to that application. The application has therefore been withdrawn and the matter is to be either resolved between Maness and Donna Bruhn or brought before the Court. (See Notice of Withdrawal) The Committee believes that it is in the best interest of the creditors that the property be listed for sale. We will continue to monitor these issues.
