That's a darn good question, 12Yearplan. There is an element of faint hope that maybe Horizon would reconsider seizing and selling all of Cereplast's assets, or that Scheer faintly hopes that he can secure financing before Horizon can seize and sell the assets.....or the Filing was an action to protect Scheer from any personal liability IF there is a sale of Cereplast's assets that would be deficient in satisfying the secured debt to Horizon.
Added EDIT: I know of no company that would grant Cereplast Debtor In Possession (DIP) financing when Horizon owns the entirety of Cereplast's assets.
If Horizon moves the Court to honor the encompassing agreement that secures absolutely every asset of Cereplast then the Court would be obligated to change the Chapter 11 Reorganization to a Chapter 7 Liquidation.
It is important to recognize that Secured Creditors are the first priority in every bankruptcy. In most BK's there are more than one Secured Creditor so the Judge must consider each Secured Creditor's demands which prolongs those BK's. With Cereplast Horizon is the ONLY Secured Creditor and Horizon has liens on 100 % of Cereplast's assets, so the Judge has no conflicts of other Secured Creditors.
Cereplast agreed in writing to not use any proceeding including insolvency (ie., any Chapter of BK) to interfere with the seizure and sale of their assets....ALL of them, so it is expected that Horizon will file their response expeditiously.
Everything now hinges on Horizon's response because the Judge has no latitude to recognize or accept any pleas by Cereplast to continue operations.
To bite the worm of incite is to bite the HOOK of the antagonist . They win .
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