加拿大华人论坛 加拿大留学移民美国投资移民 - 转载：Chapter 11 offers options for beef plant（南达科塔州）

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Former employees say National Beef reps toured Northern Beef Packers July 27, 2013|By Jeff Natalie-Lees, [email protected] The future is uncertain for Northern Beef Packers as it heads into Chapter 11 bankruptcy, but there are several possible scenarios. Jon Van Patten, professor at the University of South Dakota School of Law with a specialty in bankruptcy law, said Northern Beef's decision to file Chapter 11 shows that the owners want to retain control of the company's future within the limits imposed by the bankruptcy court. "The company did not choose Chapter 7 bankruptcy, which is basically a liquidation," Van Patten said. "The owners are not discharging their debt, but are seeking to re-write the debt to whatever the creditors will accept." The bankruptcy plan includes such provisions as readjusted debt amounts. Northern Beef owes millions of dollars to 277 unsecured creditors. "The creditors may say they are willing to take less money in the hopes of getting something rather than nothing," Van Patten said. "As the saying goes, 'They are going to take a haircut.’ ” The plan typically includes payback schedules and various conditions. The creditors have a large say in determining this, Van Patten said. Restructuring debt could potentially make the company better able to attract new investments or make it more attractive to a buyer, he said. There has been speculation that Northern Beef is up for sale or is trying to attract a partner. Several former employees have said that representatives from National Beef, the fourth-largest beef processor in the country with headquarters in Kansas City, Mo., toured the plant in early June. Mark Wojtaszek, a laid-off Northern Beef employee, said that a National Beef representative visited the knife room at the plant while he was working there. "They were taking a tour of the plant," he said. "I can't say if they were there to buy it or invest in it. All I can say is that they were there asking questions." Jeffery LaCroix, a laid-off meat cutter at Northern Beef, said he also saw the group touring the plant. Northern Beef Packers filed for Chapter 11 bankruptcy protection on July 19. On Wednesday, 260 workers were laid off from the plant. Van Patten said that Chapter 11 is sometimes used as a way to buy time when a company is trying to find a buyer. A bankruptcy plan is not due until 120 days after filing. There can also be extensions granted. Van Patten said that there are many examples of companies that have gone through Chapter 11 and come out it to become successful. It, however, depends on the industry and specific conditions in the industry, he said. "There were a lot of beef plant bankruptcies in the 1980s, but the conditions were different," he said. "At that time, the plants were struggling with high costs and used Chapter 11 as a way to get concessions on labor costs. It sounds like that is not the problem at Northern Beef. The problem seems to be on the revenue side if they are not slaughtering cattle." Formulating the bankruptcy plan is a process of negotiation between the company, its secured creditors and unsecured creditors. There is a possibility that the Chapter 11 bankruptcy does not work out and the court converts it to a Chapter 7 bankruptcy. A lot more will be known after the motion to use cash collateral is heard, Patten said. That motion releases money to allow a company to operate on the short term. Important conditions and stipulations are often involved in that motion, he said. "You will be able to know a lot more about where the case is headed after that hearing," he said. The motion is scheduled to be heard Wednesday in federal court in Sioux Falls, according to court documents. Judge Charles Nail Jr. will hear the case. Follow @Business_AAN on Twitter.

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