Vineyard National Bancorp files bankruptcy after bank closure, sale

By Caroline Salls

Pittsburgh, July 22 - Vineyard National Bancorp filed for Chapter 11 bankruptcy on Tuesday in the U.S. Bankruptcy Court for the Central District of California after its wholly owned subsidiary and principal asset Vineyard Bank, NA was closed by the Office of the Currency of the Comptroller, according to an 8-K filed with the Securities and Exchange Commission.

The company said the Federal Deposit Insurance Corp. was appointed as the bank's receiver and facilitated the acquisition by California Bank & Trust of most of Vineyard Bank's assets and liabilities on July 17.

Vineyard National Bancorp plans to file a liquidating plan within several weeks.

Debt details

According to the 8-K, the company has $2.1 million in total assets and $181.7 million in total debt.

First Vineyard's largest unsecured creditors include:

• First Tennessee Bank, NA of Memphis, Tenn., with a $50.83 million loan agreement claim;

• Vineyard Statutory Trust XI is Wilmington, Del., with a $19.49 million junior subordinated debentures claim;

• Vineyard Statutory Trust IX of Wilmington, Del., with a $16.13 million junior subordinated debentures claim;

• Vineyard Statutory Trust I of Boston, with a $13.35 million junior subordinated debentures claim;

• Vineyard Statutory Trust VI of Houston, with a $13.18 million junior subordinated debentures claim;

• Vineyard Statutory Trust III of Wilmington, Del., with an $11.05 million junior subordinated debentures claim;

• Vineyard Statutory Trust V of Houston, with an $11.02 million junior subordinated debentures claim;

• Vineyard Statutory Trust IV of Wilmington, Del., with a $10.97 million junior subordinated debentures claim;

• Vineyard Statutory Trust VII of Wilmington, Del., with a $10.9 million junior subordinated debentures claim; and

• Vineyard Statutory Trust VII of Wilmington, Del., with a $10.82 million junior subordinated debentures claim.

The company said the bankruptcy filing triggered events of default under several of its trust preferred securities indentures, as well as its subordinated debentures and its senior line of credit with First Tennessee Bank, NA.

Officer changes

Vineyard National said directors Harice "Dev" Ogle and James G. LeSieur III resigned on July 21. LeSieur will remain as the company's chief financial officer to oversee its administrative activities during the bankruptcy case.

The company has appointed Donald Pelgrim as executive vice president and chief administrative officer.

Vineyard National is the holding company for Vineyard Bank and is located in Corona, Calif. Its Chapter 11 case number is 09-26401.

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