The bankruptcy proceedings of the DBSI companies were commenced on November 10, 2008.
The DBSI management team, led by Douglas Swenson, was removed by the Bankruptcy Court upon the appointment of the Chapter 11 Trustee (Order for appointment of Chapter 11 Trustee).
The Chapter 11 Trustee was appointed as a fiduciary for the bankruptcy estates of all of the DBSI companies that filed for bankruptcy. This followed the interim findings of an Examiner, whose Final Report of Examiner was issued in October 2009 and the motion of the US Trustee for appointment of a Trustee.
The Chapter 11 Trustee retained Conrad Myers, an expert in turnaround management of distressed businesses and their reorganization or orderly liquidation, to oversee management of the debtor companies following the Chapter 11 Trustee’s appointment in August 2009.
The Chapter 11 Trustee and the Official Committee of Unsecured Creditors jointly proposed a chapter 11 plan. (“the Plan”).
The Chapter 11 Trustee and the Committee prepared certain Disclosure Statements to provide parties with information about the Plan:
Master Disclosure Statement: contains comprehensive information about the Plan.
Note/Bond/Fund Investor Disclosure Statement: provides more streamlined information about the Plan for persons or entities who purchased notes, bonds or units from certain funding entities affiliated with DBSI, Inc.
TIC Investor Disclosure Statement: provides more streamlined information about the Plan for persons or entities who made tenant-in-common investments in certain real properties that were managed by DBSI, Inc. and/or its affiliates under masterleases, operating agreements, or management agreements.
The Plan and applicable Disclosure Statements were distributed submitted to creditors for a vote.
On October 26, 2010 the United States Bankruptcy Court for the District of Delaware entered an order confirming the Plan.
The Plan became effective on October 29, 2010.
Under the Plan two separate liquidating trusts; the DBSI Liquidating Trust (“The DBSI Liquidating Trust”) and the DBSI Real Estate Liquidating Trust (“The DBSI Real Estate Liquidating Trust”) were created for the purpose of liquidating the remaining assets of the debtor companies. The Trustee of both asset liquidating trusts is Conrad Myers.
The Plan also created two litigation trusts; The DBSI Estate Litigation Trust and the DBSI Private Actions Trust. The Trustee for both of these trusts is James R. Zazzali, who formerly served as the Chapter 11 Trustee.