Several filings in Reagor-Dykes bankruptcy case
Attorneys involved in the Reagor-Dykes bankruptcy case filed several documents this week as the Auto Group prepares for a stalking horse bidder to purchase it by late next month.
Attorneys for Reagor-Dykes ask the court to approve an agreement allowing KamKad Automotive to purchase vehicles traded in at Reagor-Dykes dealerships. KamKad is the stalking horse bidder that signed a purchase agreement Sept. 30.
The filing states allowing KamKad to be involved in trade-ins would "kick start" business operations until closing of the sale of Reagor-Dykes. In earlier court hearings, the chief restructuring officer now running Reagor-Dykes said only a few vehicles have been traded in because the dealerships do not have access to necessary funds or financing.
Specifics are in a pdf below. The agreement states before a customer purchases a vehicle from Reagor-Dykes, KamKad would submit a purchase bid on each proposed trade-in. KamKad would set up a process for Reagor-Dykes to submit photos of trade-in vehicles, along with information on any liens and payoff amounts. The attorneys ask for a hearing on this matter Oct. 18.
Pay off of TT&L
Attorneys for Reagor-Dykes ask for all of its retail lenders to pay off tax, title and license fees and trade-in lien payoffs.
The filing states in late July Ford Credit placed personnel at each Reagor-Dykes dealership, took possession of vehicle keys, titles and notified indirect lenders to send money from unpaid sales contracts to Ford Credit instead of Reagor-Dykes. The filing states, as a result, commercial banks placed holds on the Auto Group's funds and retail lenders stopped funding completed retail sales contracts.
Because of this, Reagor-Dykes has not been able to pay for TT&L or trade-ins. The filing states the Auto Group has learned some customers have not been able to register their cars and are facing threat of repossession and/or demand for payment on either the new vehicle or the one the customer traded in.
Reagor-Dykes' attorneys argue, while the dealerships were responsible for these payments before it filed for chapter 11, the retail lenders now hold the affected contracts. Therefore, the retail lenders should now pay all unpaid TT&L and trade-in payoff amounts, under the "holder rule" in bankruptcy law.
Reagor-Dykes' attorneys asks the court to order the holder of all lenders who hold titles on property related to Reagor-Dykes or sold by Reagor-Dykes to pay the TT&L and trade-in liens. A separate debtor-in-possession bank account would be set up exclusively for these transactions.
Amarillo landlord wants rent
An attorney for the owner of property where Reagor-Dykes Mitsubishi in Amarillo is located asked the court to force Reagor-Dykes or a potential purchaser of the Auto Group to pay rent. The filing states the owner, FayeBuck Family, LLC, has not received rent payment since July. A check sent in August was returned by Reagor-Dykes' bank following filing for chapter 11 protection. This issue will be heard Oct. 17 in court.
Lengthy list of creditors
Reagor-Dykes also asks the court to limit the number of parties it must send notice as required in bankruptcy proceedings. There are more than 250 creditors and potential creditors, equity interest holders and other parties involved in the case, according to this filing. More are expected.
The notice states "the potential costs associated with the copying and mailing or otherwise serving of pleadings on all creditors and other interested parties would impose an undue and expensive administrative burden upon the Debtors and the bankruptcy estate."
This proposal would limit the list of parties requiring notice to: the debtors, counsel for the debtors, United States Trustee, 20 largest unsecured creditors, and other parties that have or will request to be added to a "limited mailing matrix".
Filing for KamKad to be involved in trade-ins:
Filing related to TT&L and trade-ins:
Request to limit notice: