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November 9, 2018 – Lucky Dragon Hotel & Casino’s Official Committee of Unsecured Creditors filed a motion to convert the Debtors’ Chapter 11 case to a case under Chapter 7 [Docket No. 964]. The Debtors state, “Through the Motion, the Committee seeks an order converting the Debtors’ Chapter 11 cases to cases under Chapter 7 for “cause” pursuant to section 1112(b) of the Bankruptcy Code because, for among other reasons: (1) the Debtors have failed to confirm their chapter 11 plan of reorganization and the Court has determined that the chapter 11 plan is not viable; (2) the Debtors’ Monthly Operating Reports (‘MORS’) evidence the Debtors’ continual post-petition losses, such that they have no prospect of reorganization; (3) Snow Covered Capital, LLC obtained relief from the automatic stay and has foreclosed on the Debtors’ hotel and casino (the ‘Property’); (4) the Debtors’ principals are non-responsive and have conflicting interests calling into question whether they will act in the best interests of the estates; and (5) the Debtors have assets for the Chapter 7 trustees to administer for the benefit of the estates. There is no longer any reason for the Debtors to remain in Chapter 11 bankruptcy cases, which would only result in increased administrative expenses, and further delay and prejudice the creditors of the Debtors’ estates.”
The Court scheduled a November 20, 2018 hearing to consider the motion.
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