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DBSD North America: Ad hoc committee eyes OK to file modified plan
By Lisa Kerner
Charlotte, N.C., Dec. 28 - DBSD North America, Inc.'s ad hoc committee of parties that hold or manage holdings of the DBSD-issued 7.5% convertible senior secured notes due 2009 and affiliate debtors asked the court to allow the committee to file a revised version of the debtors' plan that does not violate the absolute priority rule, according to a filing with the U.S. Bankruptcy Court for the Southern District of New York.
The ad hoc committee also asked the court to modify the debtors' exclusive period to solicit acceptances under the debtors' plan. The period is set to expire on Jan. 15.
A hearing date is proposed for Jan. 5.
As previously reported, DBSD's plan of reorganization confirmation order was partially reversed on Dec. 6 by the U.S. Court of Appeals for the Second Circuit in connection with an appeal filed by Sprint Nextel Corp.
Sprint's appeal was based on the grounds that the "gift" of equity to the debtors' parent company violated the absolute priority rule.
The ad hoc committee said it is prepared to file a minimally modified version of the debtors' plan that eliminates the offending gift but leaves the remainder of the debtors' plan largely intact.
According to the filing, the debtors could run out of cash as early as February 2011.
"A confirmable plan of reorganization for the debtors must be filed immediately to avoid the debtors becoming administratively insolvent," the filing said.
DBSD is a subsidiary of ICO Global Communications (Holdings) Ltd., a Reston, Va., mobile satellite services company. The subsidiary filed for bankruptcy on May 15, 2009. Its Chapter 11 case number is 09-13061.
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