The distributions will be semi- annually and it will be based on available cash from liquidation.
Although the Disclosure Statement says there will be an estimated recovery of 14.7 % for Classes 3 - 8 - with the exception of Class 5's distributions going to Class 3 until they are paid in full - it is not likely that the Debtors will wait until the end of the bankruptcy and just give 1 distribution.
Let me try to explain in another way.
Classes 1 and 2 are Secured Claims which simply means that they get paid !00% of their Claim before Unsecured Claims.
Classes 3 - 8 are Unsecured Claims. The numerical order does not indicate priority but only the type of Claim.
According to the Disclosure Statement Class 3 is equal in priority to Classes 4, 6, 7, 8.
According to the Disclosure Statement Class 3 is senior in priority to Class 5
According to the Disclosure Statement Class 5 is equal in priority to Classes 4, 6, 7, 8.
According to the Disclosure Statement Class 5 is junior in priority to Class 3.
There is a subordination clause in Class 5's Guarantee that says in the event of a bankruptcy Senior Bonds - Class 3 - is entitled to be paid in full first.
Classes 4, 6, 7, 8 will continue to receive their pro rata share distributions at the same time as Class 3 because they are equal in priority to Class 3.
Only Class 5 is subordinate to Class 3 and that is why their distribution is reallocated to Class 3 until the Senior Notes are paid in full.
By the time Class 3 is paid in full Classes 4, 6, 7, 8 will have been approx 83 % paid in full.
Class 5 will not have to wait until Classes 4, 6, 7, 8, are paid in full to receive their distributions.
If Classes 3, 4, 6, 7, 8 are not equal in priority under the bankruptcy code then Class 5 is being treated unfairly.
