Indianapolis Downs wins confirmation of joint plan of reorganization

By Jim Witters

Wilmington, Del., Jan. 31 - Indianapolis Downs, LLC's modified second amended joint plan of reorganization was confirmed in a Jan. 31 opinion by judge Brendan L. Shannon filed with the U.S. Bankruptcy Court for the District of Delaware.

In a 28-page opinion, Shannon overruled several pending objections from the Oliver Parties, who include senior management and holders of equity and debt instruments of the debtors, and by the U.S. Trustee.

The Oliver parties include: Ross J. Mangano, individually and as the trustee of the Jane C. Warriner Trust dated Feb. 26, 1971, the J. Oliver Cunningham Trust dated Feb. 26, 1971, and the Anne C. McClure Trust dated Feb. 26, 1971; Troon & Co.; John C. Warriner; Oliver Estate, Inc.; and Oliver Racing, LLC.

In addition, the restructuring support parties, while strongly supporting confirmation of the plan, objected to certain releases in the plan.

Judge Shannon found in favor of Indianapolis Downs on each objection.

The opinion comes more than three months after a two-day confirmation hearing, during which the court heard from six witnesses and the parties submitted into evidence more than 200 exhibits.

Asset sale pending

As previously reported, plan confirmation was predicated on a sale of substantially all of the debtors' assets.

On Oct. 31, the court approved a $500,000,001 sale to Centaur LLC.

The sale transaction remains pending, as the parties await regulatory approvals from the state of Indiana.

Creditor treatment

Under the confirmed plan of reorganization, treatment of creditors includes:

• Each holder of a pre-bankruptcy second-priority note claim and second-priority guarantee claim will receive a share of all of a new second-lien term loan or all of the proceeds from alternative second-lien financing, as well as 95% of a new unsecured PIK term loan and 95% of new series A warrants;

• Each holder of a pre-bankruptcy third-priority note claim and a third-priority guarantee claim will receive 5% of the new unsecured PIK term loan, 5% of the new series A warrants and 100% of new series B warrants;

• All debtor-in-possession financing claims, administrative claims and priority tax claims will be paid in full;

• Other priority claims and other secured claims will be unimpaired; and

• Holders of general unsecured claims and interests will receive no distribution.

Indianapolis Downs, a Shelbyville, Ind., racetrack, off-track betting and gaming company, filed for bankruptcy on April 7, 2011. Its Chapter 11 case number is 11-11046.

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