The following information has been received from Blum Collins and is being posted concerning notices received by ex-Hellerites as to the settlement agreement:
Early this week you will receive two notices from the Claims Administrator in the Heller bankruptcy regarding resolution of your claims against Heller arising out of your employment at Heller. The most important notice, related to the class settlement, is quite elaborate and does not require further detailed discussion. We did, however, want to give you a heads up about what these notices mean and invite you to email to us any questions you might have [collins@blumcollins.com and dthorpe@thorpelink.com]. Our intention is to gather the questions we receive and to send by email and post on Heller Highwater answers that are of interest to everyone. Of course we will deal with individual questions separately.
You will receive a Notice to Plaintiff Class of the proposed settlement we have negotiated with Heller and its Creditors’ Committee (the “Class Notice”). In the Class Notice you are advised of the economic significance of the settlement to the class generally and of the amounts of your claims against the net assets in the Heller estate that will be given priority, non-priority and subordinated status. The details are well described in the Class Notice, but in summary, the class will receive an allocation of approximately $4.5 million in priority wage claims, $7.5 million in non-priority wage claims and $7.0 million in waiting time penalty claims, although is quite unlikely that you will recover anything on the waiting time penalty claims. How your interest in those amounts has been calculated is described in the Class Notice and through the examples that are in Exhibit 2 to the Class Notice. One provision of the Bankruptcy Code that significantly impacts the total amount you may receive through allocation of your claims between priority and non-priority status is that there is a limit of $10,950 on the amount any employee can receive as priority wages (the “Priority Wage Cap”) so even if you have an aggregate claim (accrued vacation plus unpaid wages plus WARN) in a greater amount, the Code limits the amount that can be given priority treatment to $10,950; the balance is in the non-priority category.
If things go according to the present schedule, the full priority amounts (less tax withholding on wages) will be paid in late July or August. The amount you will receive on your allocated non-priority claims, and when you will receive additional payments, depends on Heller’s future success in collecting money from its debtors, including Bank of America and the Heller shareholders with the largest interests in the firm. Those risks are discussed in the draft Disclosure Statement and will be described in detail in the approved Disclosure Statement you will receive at the time you are asked to vote on the Plan.
You do not need to do anything to be included in the class and receive the benefits of the settlement. As with all class claims, you have the right to Opt-Out of the class; however, if you Opt-Out, you relinquish any benefits you would otherwise receive as a member of the class and you will have to pursue your claims individually. The details of the consequences of opting-out are described on page 17 of the Class Notice.
You also should receive a 2-page Notice of Hearing to Consider Approval of the Disclosure Statement describing the proposed Plan. You do not need to respond unless you have an objection to the adequacy of the proposed Disclosure Statement. As indicated in the Notice, on May 5 the Bankruptcy Court will address the adequacy of the Disclosure Statement and, when approved, a final Disclosure Statement will be mailed to all creditors, which includes employees. At that time that you will be asked to vote on the proposed Plan.
© 2010, copyright Thomas MacEntee
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