Congress Financial, Airwalk Internationals senior secured creditor, has been granted an expedited hearing on November 26, 2003 to press their case with the U.S. Bankruptcy Court in Denver. The Court had stayed the initial NY State Court order that enabled the bank to foreclose on Airwalk and collect $14 million in debt.
As reported in SEW_0346, a group of Asian factories pushed Airwalk into Chapter 11 bankruptcy on November 13 to stymie attempts by Airwalks parent, Sunrise Capital Partners, to buy the company out of foreclosure for $26 million free and clear of any other debt.
Sunrise and Congress were jointly funding the buyback.
At the center of the case is Sunrises contention that they hold Airwalks junior secured debt worth approximately $86 million. Congress and Sunrise argue that there is nothing left for the non-secured group after the senior and junior secured guys get their due.
