Acceptance Insurance Companies Inc. (OTC: AICIQ) filed a voluntary petition under Chapter 11 on 1/07/05 in the United States Bankruptcy Court for the District of Nebraska. Additionally, two subsidiaries, Acceptance Insurance Services, Inc. and American Agrisurance, Inc., filed voluntary petitions under Chapter 7 of the Bankruptcy Code on 1/07/05 in the same venue.
Bankruptcy Judge Timothy J. Mahoney denied the Motion to Extend/Limit Exclusivity for Filing a Chapter 11 Plan and Disclosure Statement on 8/20/08 [Docket 355].
AICI Capital Trust, 9.00% Preferred Securities, liquidation amount $25 per share, guaranteed by Acceptance Insurance Companies, Inc., redeemable at the issuer's option on or after 9/30/2002 at $25 per share plus accrued and unpaid dividends, maturing 9/30/2027, distributions of 9.00% ($2.25) per annum are paid quarterly on 3/31, 6/30, 9/30 & 12/31 to holders of record on 3/15, 6/15, 9/15 & 12/15 respectively. The company has the right, at any time, to defer dividend payments for up to 20 consecutive quarters (but not beyond the maturity date). The trust's assets consist of the 9% Junior Subordinated Deferrable Interest Debentures due 9/30/2027 which were purchased from the company using the funds generated from the sale of the trust preferred securities. There were 3,795,000 shares outstanding at 11/22/02. AICPQ holders were detailed as having a total claim of $115,059,998, made up of $94,875,00 in principal and $20,184,998 in interest.
Acceptance Insurance Companies Inc. had $22 million in litigation claims when it filed for bankruptcy protection.
P. Thompson Buchanan filed a $13 million claim for wrongfull termination (Buchanan v. Martin, et al., No. 2004-527 District Court, Lubbock County, Texas). The claim was listed in the Chapter 11 filing, however, it was not resubmitted by the 1/12/11 deadline to remain a valid claim when the case converted to Chapter 7.
Granite Reinsurance Co Ltd had a $9 million judgement. The judgement with accrued interest stood at $17,533,966 at 9/30/15. Continental Casualty Company had a claim against Granite Re and several other parties in the amount of $44,295,056 plus interest. The District Court entered a judgement on 1/27/15 in favor of Continental against Granite Re subjecting Granite Re's interest as holder of the Granite Re Judgment to the payment of the Continental Judgement and assigned Granite Re's interest to Continental. The Settlement Agreement provided that AIC would pay Continental $11 million and Continental released AIC and AICIQ (the parent) from any and all liabilities related to the Granite Re Judgement.
All legacy litigation claims have now been resolved.
Richard D. Myers of McGill, Gotsdiner, Workman & Lepp, PC is the Chapter 7 Trustee. James E. Bird of Polsinelli PC is Special Counsel for the Chapter 7 Trustee.