By Scott Shumaker | East Valley Tribune
Last week, an attorney for Legacy Cares canceled a federal bankrupcy court auction that had been set for Oct. 5 to sell the 320-acre Legacy Park in southeast Mesa, telling the judge the nonprofit had not yet received any qualified bids.
In his filing, Legacy attorney Henk Taylor still held out hope of securing a bid for the youth and amateur sports facility before debtor-in-possession financing runs out in late October.
He wrote that Legacy Cares is still working with interested parties to improve their bids and “believes it is still possible to bring such an offer to the Court within the timeframe set by the existing (budget).”
But an orderly exit from Chapter 11 bankruptcy – with a new owner taking over and pumping money into operations to keep the doors open – looks increasingly unlikely as signs appear that its creditors have lost hope that a sale will materialize.
The recent actions by creditors also suggest they will not be willing to pump any more emergency funding into Legacy Cares to keep Legacy Park open beyond October.
On Sept. 27, an attorney for Legacy’s unsecured creditors – who don’t hold liens on park property – filed a motion to convert Legacy Cares’ bankruptcy from Chapter 11 to Chapter 7.
While Chapter 11 is considered a “reorganization” effort, Chapter 7 is a “liquidation” in which “the bankruptcy trustee gathers and sells the debtor’s nonexempt assets and uses the proceeds of such assets to pay holders of claims,” according to the U.S. Courts system.
