jin
Joined: 10 Dec 2015
Posts: 44
Location: Schenectady, NY
|
 Posted: 15 Jan 2016 08:03 Post subject: nike air max 90 id womens shoe |
 |
|
Auctions of Hecker's stuff won't come close to making up what creditors are owed
No matter what pandora murano glass beads wholesale you think of Denny Hecker, you have to admit he had some nice toys.
At the auction house west of Minneapolis where a couple of dozen of the bankrupt auto mogul's possessions will go on sale Tuesday, there's a golf cart decked out as a black Cadillac Escalade, parked just a few feet from a matching full size Escalade. There are the five Harley Davidson motorcycles, including a couple of "Screaming Eagles," shiny from lack of use. There's a snowmobile with 10 miles on it and a Vespa scooter covered in Target logos.
And towering over everything is the 35 foot Cobalt, described by experts as a "gentleman's performance boat" that clocks 70 mph at full throttle, complete with cabin, toilet, GPS navigation and a driver's seat with so many switches and gauges that it looks more like an airplane cockpit.
"Everything Hecker had is premier," says auctioneer Fred Radde of Fred W. Radde Sons in New Germany. That quality, along with the media attention that's come with Hecker's staggering $767 million bankruptcy and federal fraud charges, will likely mean a full house for Tuesday's auction. "There are a lot of people who are there just because they want to see what he had or what it brings," Radde says.
Hecker, of course, won't see a dime from the sale. Once the owner of a large auto dealership network and leasing operation, he filed for bankruptcy last June after a judge ruled that he owed $477 million to lender Chrysler Financial for loans he had personally guaranteed. Hecker has said he expects to owe an estimated $400 million after his assets are liquidated essentially a lifetime in debt. Today, he is so broke that he had to have a lawyer appointed by the court to defend him against charges that he defrauded lenders and the bankruptcy court. He has pleaded not guilty.
Tuesday will be the third Hecker auction. The more than 300 items Radde has auctioned off in the first two, including hundreds of golf clubs, two pandora retired earrings pontoons and a half dozen personal watercraft, have netted $119,000 for the bankruptcy estate. The auctions are the most public way the trustee liquidates assets to collect money to pay creditors, but not the pandora necklaces sterling silver only way.
So far, the trustee, Randall Seaver, has collected $1.5 million. That's a lot of money compared with the typical bankruptcy case. But it won't go very far toward satisfying Hecker's host of creditors.
When Hecker filed for bankruptcy, he listed among his assets a million dollar Medina home, a lavish estate in Crosslake valued at between $7 million and $11 million, two condos in Bayport, a 53 foot Hatteras yacht, jewelry and other trappings of wealth.
In a bankruptcy with assets, a trustee works behind the scenes to find, retrieve and liquidate the assets. Even then, unsecured creditors usually get just pennies on the dollar. This case has been particularly complex, as the trustee, Seaver, has uncovered more assets than what Hecker initially reported, but has also found no value in others.
Almost all of the big ticket items have been taken back by secured lenders in foreclosure proceedings, or are about to be.
Nearly a year after Hecker filed for bankruptcy, Seaver said the hunt and legal wrangling for assets likely will continue for at least another year. The average asset bankruptcy case takes two years to complete, and bankruptcy experts agree there's nothing average about the Hecker case.
Seaver is "pleased with where the case is today," his attorney, Matt Burton, said last week.
But don't start counting the pennies just yet. Not all of that money will be available for creditors. Because legal title to many items was held by Hecker's many businesses, some of the money is tied up in litigation to determine whether the bankruptcy estate even has a right to it. And administrative expenses to pay the trustee, his lawyers, accountants, auctioneers and other professionals will consume a sizeable portion.
Seaver's work on this case is typical Pandora 2016 of any bankruptcy, although on a larger scale than most. A trustee has to go through a cost benefit analysis to determine what's worth liquidating and be a bit of a forensic detective to make sure the debtor reported all assets.
"You have to balance speed and efficiency to get the most you can for creditors," said David Leibowitz, a private trustee in Chicago and a director of the National Association of Bankruptcy Trustees. "In addition to that, you can't spend too much money doing it."
Those administrative costs can add up quickly, particularly in complex cases such as Hecker's, in which the trustee has hired many attorneys, accountants and other professionals. For example, the auctioneer selling Hecker's items gets a 15 percent fee from the total generated by the auction. The trustee's attorneys are making anywhere from $150 to $390 per hour. The trustee will get a percentage of the total amount collected, according to federal bankruptcy law. It works out to be $53,250 for the first $1 million, plus 3 percent of anything above that.
Data from asset cases in Minnesota the past 10 years show administrative expenses account for an average of 30 percent of the total money recovered. Leibowitz said that figure tends to be higher for smaller cases, and lower for larger cases. A national study reported in the American Bankruptcy Law Journal last year found that administrative expenses consumed 74 cents for every dollar doled out to unsecured creditors.
This balancing of costs versus returns helps explain why Seaver agreed to allow Hecker to keep the furnishings in his Medina home including a tanning bed in exchange for $15,000 ponied up by his friends a deal that is set to be finalized Wednesday. Moving, storing and auctioning off those items might not have yielded a better return.
Allowing a debtor to buy back his or her items is more common than people think, said Patti Sullivan, a trustee who handles cases in the St. Bankruptcy Court. Hecker also bought back a pair of skis and ski boots for $200.
"At the end of the day, whoever pays the most for the asset is the one who takes it home," Sullivan said.
Seaver has also recovered several assets through legal actions. For example, title to several of the items in Tuesday's auction, including the 35 foot Cobalt, were held by one of Hecker's companies. Seaver fought that claim in court and won.
Other assets Hecker listed on his bankruptcy filing won't benefit the bankruptcy estate. The 53 foot Hatteras yacht had already been repossessed by a lender, and the Crosslake vacation property is up for sheriff's sale Monday, with $6.9 million owed. Most of his car dealerships had already been sold, and many of the other 236 businesses Hecker reported were holding companies that owned real estate that was heavily mortgaged.
"Throughout the case, and continuing to this day, the asset situation has been fluid," Burton explained.
The $1.5 million in the bankruptcy estate coffers comes from a variety of deals and legal actions some that made news and others that went largely unnoticed at the time. Some examples:
$439,200 from a promissory note owed to Hecker by Transcend Communications, a telecom company Hecker once had an ownership stake in.
$425,000 from the sale of Hecker's former Brainerd area Toyota dealership to Paul Walser, the head of the Walser Automotive Group. Seaver stepped in to negotiate a sale after a bankruptcy judge rejected an earlier deal Hecker had made with Walser that would have netted Hecker a $775,000 consulting deal. In the end, Walser got the business, the bankruptcy estate got $425,000 and Hecker got nothing. However, Cornerstone Bank claims it has a secured interest in this money.
$95,000 from the sale of two boat slips in Bayport. The remainder of the $1.1 million sale price went to secured lender Crown Bank. Two condominiums in Bayport, which Hecker valued at $300,000 each, were mortgaged for more than they were worth and ended up in foreclosure.
$80,000 from a personal services agreement Hecker had negotiated as part of the sale of the Inver Grove Heights Toyota dealership. A lawsuit is pending to determine whether this money belongs to Hecker or the bankruptcy estate.
_________________
weterggbf |
|
