In February 2012, Raleigh real estate developer Harold Lichtin filed for Chapter 11 bankruptcy protection, after failing to refinance some $39 million in construction-related loans and other debts connected to two office buildings that his company built in that city. The petition was filed with the U.S. Bankruptcy Court for the Eastern District of North Carolina,
Now, a bankruptcy court judge is conducting a confirmation hearing for his repayment plan.
Lichtin/Wade LLC filed an amended Chapter 11 reorganization plan on Jan. 22. The plan proposes to pay off all creditors in full over the next five years.
Accordign to the plan, ERGS II LL, the bankruptcy's leading secured creditor, will receive a lump sum payment of $2 million and monthly payments of $240,158 over the next five years. It will also receive a balloon payment for the remaining principal on the note within five years of the note's effective date.
Prior to the date of filing, Litchtin/Wade entered into four promissory notes with Branch Banking and Trust Company, secured by all of the Debtor’s real property, assignment of rents, and certain of the Debtor’s personal property. The four Secured Notes matured on December 15, 2011. On March 27, 2012, BB&T entered into an agreement with ERGS, whereby ERGS purchased from BB&T all of its rights, title, and interests in and to the Secured Notes. ERGS made the purchase of $39 million in promissory notes shortly after the bankruptcy petition was filed.
Other creditors will get month pyaments with a balloon payment at the end of five years.