ProtoStar creditors committee objects to extending exclusivity periods

By Jennifer Lanning Drey

Portland, Ore., June 25 - ProtoStar Ltd.'s official committee of unsecured creditors objected to the company's motion to extend its exclusive periods to file a plan of reorganization and solicit votes on the plan, according to a Friday filing with the U.S. Bankruptcy Court for the District of Delaware.

According to the filing, ProtoStar is in negotiations with the committee and its lender constituencies in an attempt to reach a consensual resolution related to two lawsuits initiated by the committee that challenge the liens of the lender groups.

However, the committee said there was no reason to assume the requested exclusivity extension would help the company reach a settlement in the near term.

"With no end to the settlement talks yet in view, the only reasonable alternative at this time is to give other proper parties in interest an opportunity to file and prosecute a Chapter 11 plan or plans, by not further extending the exclusivity periods," they said.

As previously reported, ProtoStar wants to extend its exclusive filing period to Aug. 25 from May 25 and the solicitation period to Oct. 26 from July 26.

A hearing is scheduled for July 7.

ProtoStar, a Bermuda satellite company, filed for bankruptcy on July 29, 2009. Its Chapter 11 case number is 09-12659.

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