Philadelphia Orchestra to make expedited exit from bankruptcy
The Philadelphia Orchestra Association can exit from bankruptcy on an expedited schedule.In a hearing Monday in U.S. Bankruptcy Court, Judge Eric L. Frank said he would approve a timeline to bring the orchestra before the court again on June 28 for a confirmation hearing. Because of the "aggressive scheduling," Frank said, any objections to the orchestra's reorganization plan would have to be heard at the confirmation hearing, which could take a day or two. The judge, after reviewing a list of procedural concerns, said he was approving the quicker-than-usual schedule in recognition of the case's notoriety, suggesting that any interested parties were already aware of the bankruptcy. Ballots approving or objecting the plan are being sent to creditors and are due back by June 26.
The Philadelphia Orchestra Association can exit from bankruptcy on an expedited schedule.
In a hearing Monday in U.S. Bankruptcy Court, Judge Eric L. Frank said he would approve a timeline to bring the orchestra before the court again on June 28 for a confirmation hearing.
Because of the "aggressive scheduling," Frank said, any objections to the orchestra's reorganization plan would have to be heard at the confirmation hearing, which could take a day or two. The judge, after reviewing a list of procedural concerns, said he was approving the quicker-than-usual schedule in recognition of the case's notoriety, suggesting that any interested parties were already aware of the bankruptcy. Ballots approving or objecting the plan are being sent to creditors and are due back by June 26.
Lawrence G. McMichael, the orchestra's chief bankruptcy lawyer, said he expected no objections. Frank said he agreed with the orchestra's argument that there was little reason to believe that "any major dissident faction" would surface.
The orchestra filed for Chapter 11 bankruptcy protection April 16, 2011, and has spent 14 months negotiating new contracts in an effort to reduce its operating costs. After contentious talks with musicians, a new concessionary labor agreement was reached. A merger in process with Peter Nero and the Philly Pops was halted, and the groups split. The orchestra withdrew its participation in the national musicians' pension fund and moved participants to a defined-contribution plan. A new lease agreement was agreed to by the orchestra's landlord for Verizon Hall, the Kimmel Center. A new donor agreement between the orchestra and the Annenberg Foundation (the orchestra's most generous donor) was crafted.
Lawyers from these groups attended — or in the case of the Annenberg Foundation, listened in on — Monday's hearing.
In presenting his argument for an expedited exit from bankruptcy, McMichael said the association wanted creditors paid as soon as possible and wanted to avoid an additional month of legal and other professional fees.
"This case has gone on longer than we would have liked." he told Frank.