Chalk one up for anyone who has ever been screwed by Cornell in the past!!
U.S. Federal Bankruptcy Court Confirms Cobalis Corp's Plan of Reorganization
Cobalis Corp Emerges From Bankruptcy
Apr 12, 2010 9:15:00 AM
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IRVINE, CA -- (MARKET WIRE) -- 04/12/10 -- Federal Bankruptcy Court Judge Theodor C. Albert, of the Central District of California issued his final ruling on April 7, 2010, handing Cobalis Corp (PINKSHEETS: CLSC) a resounding victory by confirming Cobalis Corp's plan of reorganization. Upon confirmation, Cobalis will officially emerge from bankruptcy, with requirements to pay its creditors over a 5-year period.
In deciding his ruling, Judge Albert heard and reviewed extensive testimony, documents and expert opinions from both Cobalis Corp and from YA Global (formerly known as Cornell Capital), which filed a competing plan that the Court did not confirm.
Judge Albert decided that Cobalis' plan for reorganization met all the criteria of The United States Bankruptcy Code, and afforded Cobalis' creditors, shareholders and investors a significantly higher level of protection than did YA Global's competing plan which would have eliminated all current shareholder equity.
Under the now-approved Cobalis plan of reorganization, all classes of creditors will be paid in full on their allowed claims with interest as determined by the Court, fully amortized over a five year term in monthly installments. Management believes it may well be able to meet these obligations in a shorter term, based on revenues generated. As Cobalis continues to dispute certain creditor claims, including those of YA Global, payments will be paid into an escrow account on the same schedule. Notably, under Cobalis' plan, existing shares in Cobalis are preserved.
Commenting on the litigation contesting the amount owed to YA Global, the Court stated: "Even though the Court has discounted the litigation threat on a temporary basis for voting purposes, if debtor prevails, it is conceivable that no amount would be owed YA Global and this could be determined well in advance of the payment schedule facing all others."
As the Court made clear at the confirmation hearing, "If debtor's plan is confirmable then it alone should receive the confirmation order as instructed by 11 U.S.C. Section1129(c) since it alone provides something for the shareholders and, as well, it is supported by a much wider margin of the unsecured creditors."
Cobalis CEO Chas Radovich said: "The Court's confirmation of Cobalis' plan of reorganization and our emergence from bankruptcy represents a true turning point for Cobalis, and endorses our unwavering commitment to protect our shareholders. We view the Court's confirmation of our plan as vindication of what we have believed from the beginning -- Cobalis has a viable and feasible plan to bring an amazing product in PreHistin® to market to help the hundreds of millions of allergy sufferers worldwide find a better alternative to after-the-fact antihistamines. As we move forward now out of bankruptcy, the Company intends to return to a fully-reporting status and fulfill our obligations to creditors under our plan of reorganization. We especially thank our shareholders, stakeholders and investors as well as our directors, management, advisors, legal team and creditors who have stood by us during this contentious period. We look forward to building a strong, profitable company well into the future."
