The opinion of the court was delivered by: FORMAN
The debtor has but one creditor who owns all of the obligations. He is Maxwell Abbell, Esq., and the obligations consisted of the following as of January 11, 1947:
First Mortgage . . . $ 280,000.00
Second Mortgage . . . 517,000.00
Non-Interest Bearing Notes to Fund Delinquent Interest . . . 219,207.39
Total . . . $ 1,016,207.39
The debtor has outstanding $ 697,100 in shares of preferred stock with a par value of $ 100 each, whose holders proportionately own the outstanding 3,493 shares of common stock.
In July of 1946 the creditor was about to reduce to judgment and execution in the State court the debt represented by the non-interest bearing notes mentioned above when the debtor filed its petition herein, which was adjudged to have been filed in good faith and stayed the creditor's action.
Proceedings were taken toward the development of a plan for reorganization and on December 9, 1946, a plan was filed by the debtor, but when the same came on for hearing before the Special Master on January 8, 1947, it failed of further development. Accordingly the Special Master so reported and recommended that the debtor be liquidated in bankruptcy in accordance with Sec. 236(2) of the Bankruptcy Act, 11 U.S.C.A. § 636(2).
The report and recommendation of the Special Master came on for hearing before the court on January 13, 1947, at which time the Trustees produced a new plan conceived only within 24 hours of the time of hearing. This plan proposes that an offer should be accepted to pay the full indebtedness including accrued interest due the creditor in cash, and a sum of $ 69,710, which would provide some equity for the stockholders.
Conditions of the said offer are as follows:
'Purchase for cash at par, with accrued interest, all obligations of Hotel Realty Company presently held by Maxwell Abbell, Creditor, same to be held by purchaser free of any previous commitments, if any, limiting the right to foreclose.
'Pay $ 69,710 to the Trustee of Hotel Realty Company in said Court for the conveyance by said Trustees, or by said Hotel Realty Company, or both, of all the assets of Hotel Realty Company, both real, personal and mixed, said assets comprising the Stacy-Trent Hotel, of the City of Trenton, located on the easterly side of Willow Street between West State Street on the front and Front Street in the rear, and the vacant lot adjoining the building on the Front Street side, including real estate, improvements, furniture, fixtures and equipment, and all personal property owned by Hotel Realty Company, the said transfer to include any cash on hand, exclusive of the amount herein agreed to be paid after payment of all fees, costs and administration expenses in connection with the proceedings in the United States District Court.'
'Subject to Federal Court approval, same to be obtained at any time after the expiration of sixty days from the date hereof.
'There shall be no public offering for sale of the assets of Hotel Realty Company prior to Court action on the offer herewith submitted, it being understood, however, that any notice with respect to this offer, or any other like offer to interested parties, ...