A meeting open to any and all of the Philadelphia Orchestra Association's potential 23,000 creditors was held Thursday morning. In attendance were the Association's bankruptcy lawyer, a couple of members of the orchestra administration (the new development vice president Marilyn Lucas and CFO Mario Mestichelli), two musicians, and, as far as I can tell (despite the mass mailing advising potential creditors of the meeting), four actual subscriber/donor types.
As much as I'd like to report fully on the substance of the meeting, I can't. At the start, the lawyer from the U.S. Trustee's office said the meeting was not open to the public, and he asked me to leave. The Inquirer's lawyers are now looking into the question of whether the meeting is considered public. (I suppose I could have pulled out my creditor's letter, which the orchestra sent me, which might have secured my right to be in attendance; perhaps I bought orchestra tickets at some point?)
The U.S. Trustee is the agency of the U.S. Department of Justice responsible for overseeing the administration of bankruptcy. The trustee's lawyer said that because of the bankruptcy judge's decision to extend the deadline for the orchestra to file its schedule of assets and liabilities to June 15, it was "very difficult" to hold the meeting - which is designed to give creditors (you) a chance to ask questions of the debtor (the Orchestra Association).
But the meeting went ahead. According to one person who attended, a portion of the discussion addressed the status of donors who contributed money to the orchestra as part of an annuity plan. The program is a deal in which a donation can be made to the orchestra; in exchange, the donor receives a quarterly annuity check for the rest of his or her life.
From the orchestra's website:
"Would you like to convert low-yielding or non-income producing assets into lifelong income? Are you interested in receiving a fixed income stream, no matter what happens in the financial markets? Would you like to minimize your capital gains tax and receive a current income tax deduction for a future gift? Through a charitable gift annuity, you will receive a specified rate of return, based on your age at the time the planned gift is created. Current rates are listed below, illustrating a $20,000 single life annuity."
With the bankruptcy, those charitable gift annuity donors - the orchestra says there are 27 of them - are now creditors, but an Association representative told attendees that the orchestra expects to make good on its next quarterly payment, scheduled for June, according to the source. An orchestra spokeswoman confirmed that plan.
Another meeting for creditors has been scheduled after the orchestra files its schedule of assets and liabilities. The new meeting date is June 27, 10 a.m., 833 Chestnut Street, suite 501.