Highway Technologies case to convert to Chapter 7; WARN deal approved

By Jim Witters

Wilmington, Del., Dec. 11 - Highway Technologies Inc. received approval to convert its Chapter 11 case to Chapter 7 and approval for a settlement of claims under the federal Worker Adjustment and Retraining Notification Act during a Dec. 11 hearing in the U.S. Bankruptcy Court for the District of Delaware.

The case conversion will be delayed about two weeks to allow checks issued by the debtors to clear the bank, according to attorney Debra I. Grassgreen.

Judge Kevin J. Carey stated his intent to sign the conversion order when the debtors submit it.

No Chapter 7 trustee can be appointed to administer the case until the order is signed.

The conversion was supported by the lenders and the official community of unsecured creditors.

The company said a Chapter 11 plan was not feasible, given the estimate for claims that may be asserted.

WARN agreement

The WARN claimants asserted that the debtors violated the act's requirements "before ordering mass layoffs and plant closings on or about May 17."

Highway Technologies disputed the assertion but estimated that the maximum WARN damages would total $2.02 million.

The settlement calls for the WARN claimants at an affected facility in Texas will collectively receive a general unsecured class claim in the amount of $750,000 and those at an affected facility outside of Texas will collectively receive an allowed general unsecured claim of $363,133.

Highway Technologies is a Houston-based highway safety services and equipment provider. Its Chapter 11 case number is 13-11326.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.