Wednesday, March 07, 2001
Wilkinson stores get help
Temporary plan funds companies
The Associated Press
LEXINGTON A Lexington bankruptcy judge approved a temporary financing plan Monday that will keep bookstore companies owned by former Gov. Wallace Wilkinson operating for at least the next six weeks.
The plan will provide several million dollars in interim financing by IBJ Whitehall Financial Group., a subsidiary of the International Bank of Japan, to keep the companies going until their busy purchasing season begins in mid-April. U.S. Bankruptcy Judge William S. Howard scheduled another hearing on March 29 to review the final order.
Attorneys for Mr. Wilkinson's companies argued that the interim financing, along with income generated by the bookstores, would provide relief while a long-term solution is settled upon by the companies and their creditors.
Mr. Wilkinson filed for personal bankruptcy protection on Feb. 8 after several creditors sought to force him into liquidation to recover more than $300 million they claim he owes them.
Last Wednesday, Wallace's Book Co. Inc. and Wallace's Bookstores Inc. filed for Chapter 11 bankruptcy in Delaware, where one of the individual bookstores in the Wallace's Bookstores chain is located and incorporated.
In a motion filed in the Lexington court, The United Co. argued that as a matter of legal procedure the bookstore company case belongs in Kentucky, not Delaware, and that it makes much more sense to have it in the same court with Mr. Wilkinson's per sonal bankruptcy.
Judge Howard then signed the transfer order for the two cases Friday in Lexington. The order means both the bookstore companies' bankruptcy and Mr. Wilkinson's can proceed, and will be treated as one case.
Mr. Wilkinson's incomplete filings show that he owes more than $340 million in business-related debts, while his companies have declared more than $52 million in debts.
Mr. Wilkinson, 59, was governor of Kentucky from 1987 to 1991. He is expected to disclose most of his debts and assets on March 14.
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