WARREN - With no cash or liquid assets left, attorneys for bankrupt First Place Financial Corp. filed court documents this week that could lay the groundwork for an end to the holding company.
Attorneys on Wednesday asked a federal bankruptcy court judge to allow the thrift holding company to convert the case from Chapter 11 bankruptcy, commonly known as "reorganization," to Chapter 7, commonly known as "liquidation."
The holding company's spokeswoman Debra Bish stressed Thursday that the Chapter 7 bankruptcy would not affect operations at First Place Bank, now owned by Michigan-based Talmer Corp. which purchased the bank through bankruptcy proceedings of its holding company.
The debtor's sale to Talmer closed Jan. 1, leaving First Place Financial Corp.with few remaining assets and no remaining cash. In the interim, Talmer agreed to fund the "wind-down" of the debtor's operations.
"Given that all of the debtor's primary creditors received direct payment in satisfaction of their claims ... and the debtor has no funds to distribute under a Chapter 11 plan, the debtor determined that it would be in the best interest of all creditors and stakeholders to convert this case to a proceeding under Chapter 7 of the Bankruptcy Code," the corporation's attorneys wrote in the court document.
The future of the holding company's shares of stock, now trading at a fraction of a penny as "FPFCQ," is still unknown, as is the future of the holding company's board of directors. Those issues are expected to be resolved in court proceedings.
Objections to the court motion are due by March 20 and a hearing is scheduled for March 27 in Delaware's federal bankruptcy court.