MSR Hotels & Resorts' disclosure statement, stipulation agreement, DIP facility access OK'd

By Lisa Kerner

Charlotte, N.C., Dec. 20 - MSR Hotels & Resorts, Inc.'s disclosure statement was approved by the U.S. Bankruptcy Court for the Southern District of New York on Dec. 20.

The plan confirmation hearing is scheduled for Feb. 6 at 11:00 a.m. ET.

As previously reported, proceeds from the sale of the company's resort marks and any liquidation of MSR's estate will be distributed under the plan. A liquidating trust will be formed to make distributions.

Treatment of creditors will include the following:

• Holders of administrative claims, debtor-in-possession claims, priority tax claims and other priority claims will receive a share of first-priority beneficial interests in the liquidating trust;

• Holders of other secured claims will either be paid in full in cash, receive the collateral securing their claims or have their claims reinstated;

• Holders of Midland Loan Services claims will receive a share of a payment equal to 80% of total sale proceeds up to $10 million and 90% of total sale proceeds in excess of $10 million, up to a maximum of $12 million, plus any special servicer fee payable to Midland and the fees and expenses of counsel to Midland, 450 Lex Private Ltd. and C Hotel Mezz Private Ltd.;

• Holders of unsecured claims will receive no distribution; and

• Interests will be cancelled, and holders will receive no distribution.

Stipulation approved

Also on Friday, the court approved a stipulation agreement between MS Resort Purchaser LLC and 450 Lex Private Ltd. and its affiliates (GIC RE) regarding the sale of the company's resort marks.

As previously reported, under the stipulation, GIC RE agreed to serve as the stalking horse bidder for the resort marks under the company's Chapter 11 plan, with a $5.5 million cash offer, subject to higher or better bids.

GIC RE, by virtue of its indirect beneficial interest in the resort marks, also agreed to an allocation of 80% of the first $10 million in sale proceeds and 90% of any sale proceeds in excess of $10 million to be paid to the resort marks secured lender.

GIC RE has agreed to turn over any sale proceeds it receives in excess of $12 million, net of up to $500,000 in expenses.

The parties have also agreed to mutual releases.

DIP financing approved

Lastly, the court granted final approval for MSR to obtain $2 million of DIP financing from CNL DIP Recovery Acquisition LLC.

MSR Hotels, a New York-based real estate investment trust, filed for bankruptcy on May 8, 2013. Its Chapter 11 case number is 13-11512.

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