Island One seeks plan confirmation despite unsecured class rejections

By Caroline Salls

Pittsburgh, April 19 - Island One, Inc. is asking the U.S. Bankruptcy Court for the Middle District of Florida to confirm its plan of reorganization even though creditors in eight unsecured claim classes did not vote to accept it, according to a Tuesday court filing.

Specifically, the company said holders of H.J.C. Floridian claims, Island One general unsecured claims, IOI Funding general unsecured claims, IORMC general unsecured claims, Virgin Island Design claims, Maple Leaf, LLC claims, St. Croix One general unsecured claims and Navigo general unsecured claims did not vote as a class to accept the plan.

However, Island One said Section 1129(b) of the Bankruptcy Code allows a company to confirm a plan over the negative vote of a class of creditors if the plan does not unfairly discriminate against and is fair and equitable for each impaired creditor class that has not approved the plan.

According to the motion, Island One's plan can be confirmed because it calls for the cancellation of existing equity interests.

The company said the Bankruptcy Code deems a plan fair and equitable if the holder of any claim that is junior to the claims of the class in question does not receive a distribution.

The plan confirmation hearing is scheduled for April 20.

Island One, an Orlando, Fla.-based timeshare resort development and hospitality management company, filed for bankruptcy on Sept. 10, 2010. Its Chapter 11 case number is 10-16177.

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