Large Scale Biology disclosure statement approved; liquidation plan confirmation hearing set for July 31

By Caroline Salls

Pittsburgh, June 26 - Large Scale Biology Corp. obtained court approval of the disclosure statement for its first amended plan of liquidation, according to an 8-K filing with the Securities and Exchange Commission.

The plan confirmation hearing will be held July 31.

According to the disclosure statement, the company's board of directors chose to liquidate rather than to restructure operations and continue as a public company because Large Scale Biology does not have the level of ongoing revenue-generating contracts or business and lacks the financial resources and access to additional funding to cover substantial anticipated research, development and other expenses needed.

Treatment of creditors under the plan will include:

• Holders of administrative claims will be paid in full in cash;

• Holders of secured claims will be paid in full with sale proceeds;

• Holders of other secured claims will retain their liens and receive deferred cash payments;

• Holders of convenience class claims of $5,000 or more or who elect to reduce their claims to that amount will be paid in full;

• Holders of general unsecured claims will receive payment in full from sale proceeds;

• All stock options will be canceled, and holders will receive their share of any remaining funds after all other claims have been paid.

Large Scale Biology, a Vacaville, Calif., company developing therapeutic and industrial proteins, vaccines and diagnostic products for effective characterization and treatment of disease, filed for bankruptcy on Jan. 9, 2006 in the U.S. Bankruptcy Court for the Eastern District of California. Its Chapter 11 case number is 06-20046.

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