Dlubak Corp., the Blairsville, Pa.-based supplier of security glass and architectural flat and bent glass laminates that filed for Chapter 11 bankruptcy protection last August, filed a motion on March 7 to convert the case to a Chapter 7 bankruptcy. The motion was filed by company owner Frank Dlubak.
In the months since the initial Chapter 11 bankruptcy protection filing made last summer in U.S. Bankruptcy Court for the Western District of Pennsylvania, the company’s assets were sold off in two separate transactions. The company first sold its non-real estate assets to Grey Mountain Partners, agreeing to do so shortly after it filed for Chapter 11 protection. This past February, the court approved the sale of the company’s real estate assets, specifically its operating facility, to KMS Property Acquisition Co., for $800,000. That sale closed on March 6.
With those assets sold, the company stated in its March 7 Chapter 7 filing that it no longer has the ability to fund a feasible plan of reorganization. Continuing the Chapter 11 case, therefore, would serve no purpose, it stated.
Meanwhile, the entity called “Dlubak Specialty Glass” is now operating under the ownership of Grey Mountain Partners. Given that it has broken off as a separate entity under new ownership, the company had no comment on the case concerning the Dlubak Corp. bankruptcy. “We’re alive and well and moving forward as Dlubak Specialty Glass,” said Chris Cotton, general manager of Dlubak Specialty Glass.
With assets sold and Dlubak Specialty Glass “moving forward,” Frank Dlubak and Dlubak Corp. are left to resolve issues with their creditors. The filing to convert the case to Chapter 7 comes after a group of creditors, called the Official Committee of Unsecured Creditors of Dlubak Corp., filed a liquidating plan in February. On March 12, Frank Dlubak filed an objection to the committee’s plan and disclosure statement.
Among other contentions, the filing states that the “lack of oversight is a common thread throughout the proposed plan, as counsel for the Committee grants himself nearly unfettered discretion to carry out the Plan as the Plan Administrator, and minimizes the role of the Court in overseeing the carrying out of the proposed Plan.”
Steven Shreve, an attorney for Dlubak Corp., could not be reached for comment at press time.
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