M Waikiki, Marriott agree to resolve plan of reorganization disputes

By Caroline Salls

Pittsburgh, July 3 - M Waikiki LLC has reached an agreement with Marriott International Inc. and Marriott Hotel Services, Inc. on a global resolution of their disputes in connection with the plan of reorganization filed by M Waikiki and the Davidson Family Trust, according to a Monday filing with the U.S. Bankruptcy Court for the District of Hawaii.

The resolution includes an agreement on the treatment of the Marriott secured claim and the Marriott unsecured claim as well as the ownership of the company's hotel.

Marriott will receive payment for its secured and unsecured claim on the plan effective date. If the effective date has not occurred by July 27, the Davidson Trust must pay Marriott by July 30.

The Marriott payment will be a condition to effectiveness of the fifth amended plan.

Under the settlement and M Waikiki's fifth amended plan:

• Marriott withdraws its vote rejecting the joint plan;

• Marriott agreed not to file any other objection or other pleading or examine witnesses in connection with the fifth amended plan or the confirmation hearing or file any claim arising from the termination of a Marriott management agreement, a technical services and pre-opening agreement and a subordination, non-disturbance agreement; and

• Marriott will "urge support" for the confirmation of the company's fifth amended plan.

The plan confirmation hearing is scheduled for July 10.

M Waikiki, a San Diego-based hotel investment company, filed for bankruptcy on Aug. 31, 2011. The Chapter 11 case number is 11-02371.

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