CoServ Files Reorganization Plans.Business Editors CoServ Electric CoServ Electric is a non-profit rural electric utility cooperative headquartered in Corinth, Texas. CoServ was organized in 1937 as the Denton County Electric Cooperative, and took its current DBA name (a shortened version of "cooperative services") in 1998. and eight of its related companies, including the CoServ telephone and cable businesses, announced today that plans of reorganization and other related disclosure statements were filed June 24 in the U.S. Bankruptcy Court bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. for the Northern District of Texas. CoServ Realty realty n. a short form of "real estate." (See: real estate) REALTY. An abstract of real, as distinguished from personalty. Realty relates to lands and tenements, rents or other hereditaments. Vide Real Property. Holdings, L.P. filed its reorganization plan A scheme authorized by federal law and promulgated by the president whereby he or she alters the structure of federal agencies to promote government efficiency and economy through a transfer, consolidation, coordination, authorization, or abolition of functions. and disclosure statement June 13. It is anticipated that the CoServ entities currently moving through the reorganization process will emerge from this process before or during the fourth quarter of 2002. The CoServ Electric plan was filed by CoServ Electric, CoServ Utility Holdings, L.P. and CoServ Investments, L.P., and was filed jointly with the National Rural Utilities Cooperative Finance Corporation (CFC CFC See: Controlled foreign corporation ), embodying the global settlement reached by the parties on May 2, 2002. The CoServ Electric plan provides for the continued existence of the electric cooperative for the benefit of its members, payment in full of all allowed claims of the debtors' estates and the establishment of a $200 million 10-year credit facility for future capital expenditures of the electric cooperative. Exit financing is provided by both CFC and CoBank, ACB ACB American Council of the Blind ACB Asia Commercial Bank ACB America's Community Bankers ACB Adjusted Cost Base ACB Alliance for the Chesapeake Bay ACB Amphibious Construction Battalion (US Navy) ACB Australian Cricket Board , another electric cooperative lending institution Noun 1. lending institution - a financial institution that makes loans financial institution, financial organisation, financial organization - an institution (public or private) that collects funds (from the public or other institutions) and invests them in . The CoServ Realty plan likewise provides for payment in full to all creditors, including CFC, which will receive a transfer of the debtor's real estate developer loan portfolio. This plan will provide for the continued funding of the developer loans by CFC. The CoServ Telecom plan provides for payment of an estimated 70% of all claims to the creditors of the CoServ telecom companies. The telecom companies previously announced debtor in possession financing debtor in possession financing Financing arranged during the time a company is in Chapter 11 bankruptcy. from CFC in the amount of $7.8 million, which will provide funding through the end of 2002. If the assets are not sold prior to that time, the ownership of the operations will be transferred to CFC. The customers of CoServ Communications are expected to continue receiving uninterrupted service through this plan. "We will emerge from bankruptcy with a stronger balance sheet, poised for future growth and focused on our core electric business," said Bill McGinnis, president and chief executive officer of CoServ Electric. "This plan is a great outcome for our members and our creditors." For nearly 65 years, CoServ Electric has provided dependable, affordable, electric power to thousands of homes. In 1998, CoServ Electric expanded both its service area and its service offerings to include a broad range of services, including telephone and cable. Further information on CoServ Electric is accessible at www.coserv.com. |
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