Meeting Scheduled on VEDC’s Chapter 11 Status

A court order has set a date for the first status conference in the Valley Economic Development Center’s Chapter 11 restructuring case. The meeting, disclosed Tuesday in court documents, will be held August 20 in the Edward R. Roybal Federal Building and U.S. Courthouse in downtown Los Angeles. The Sherman Oaks small business lending organization filed last week for Chapter 11 protection amidst a liquidity crisis that left it unable to pay back more than $35 million in outstanding loans to its lenders. Court documents indicate that “many” loans made by VEDC are in default. The status conference will shed light on such questions as to what led to VEDC’s Chapter 11 filing and what are the main legal disputes likely to be encountered during the bankruptcy. Additionally, the conference will consider evidence regarding VEDC’s projected income, expenses and cash flow for the first six months of bankruptcy, as well as how to manage VEDC’s unexpired contracts and leases. It also will propose a deadline for the filing of a disclosure statement and restructuring plan.