Rhodes exits Chapter 11 bankruptcy

By Caroline Salls

Pittsburgh, June 8 - Rhodes, Inc. emerged from Chapter 11 bankruptcy after its plan of liquidation took effect on May 24, according to a Thursday filing with the U.S. Bankruptcy Court for the Northern District of Georgia.

The plan was confirmed on May 23.

The plan will be funded with liquidation proceeds, including any cash received from the collection of outstanding accounts receivable, the sale of the company's assets and the prosecution or settlement of any causes of action.

Joel Dugan has been appointed liquidation agent and will be responsible for distributing the liquidation proceeds as detailed in the plan.

Treatment of creditors under the plan includes:

• Holders of general unsecured claims will receive an estimated 15.8% recovery in a share of liquidation proceeds;

• Holders of unsecured convenience claims of less than $500 will receive a cash payment of 25% of their claim;

• Holders of subordinated claims and Rhodes Holdings II claims will receive any liquidation proceeds remaining after payment of administrative claims, DIP lender claims, priority tax claims and general unsecured claims.

• Holders of old equity interests will receive no distribution under the plan.

Rhodes, an Atlanta-based furniture retailer, filed for bankruptcy on Nov. 4, 2004. Its Chapter 11 case number is 04-78434.

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