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12 Days To Break Deadlock

By LAMECH JOHNSON

Tribune Staff Reporter

ljohnson@tribunemedia.net

MAJOR stakeholders in the multi-billion dollar Baha Mar resort development have been granted 12 days by a judge to negotiate a solution in getting the stalled project over the finish line.

Attorneys for the relevant parties appeared before Justice Ian Winder in the Supreme Court on Tuesday morning for an expected full hearing on Baha Mar’s application for the judge to extend a ruling in the resort’s ongoing Chapter 11 bankruptcy proceedings in the United States.

The judge last week delayed the hearing by five days to allow the government and the resort’s lender – China Export-Import Bank – to be heard as parties on the application to get an approved extension from the Supreme Court in The Bahamas for its debtor-in-possession (DIP) financing approval by the Delaware court to take effect.

“I’m obliged to asked for an adjournment,” Roy Sweeting, Baha Mar’s attorney said on Thursday. He also noted: “The adjournment is to allow the parties to engage in negotiations to resolve the issues.”

He added that Damian Gomez and Brian Simms, representing the Crown and China EXIM Bank respectively, had agreed to the move in earlier discussions.

Mr Sweeting suggested a hearing date be set close to July 20, where proceedings were to resume in the Delaware court.

“I can hear the matter on the 20th (of July),” said Justice Winder.

Mr Gomez replied: “We have no objection to the adjournment.”

“All of the parties, including the applicant have agreed to meet, in good faith, (to) resolve the outstanding issues,” he added.

He also revealed that on Monday evening, Mr Simms’ client, “the president (of China EXIM Bank) spoke with the Prime Minister (Perry Christie) and wishes for immediate talks with all parties in Beijing.”

“There is a commitment to seeing this project through,” Mr Gomez added, emphasising that “this is a matter of extreme urgency and we wish to have a date to put parties to work on actually resolving the issues.”

Mr Gomez, also minister of state for legal affairs, took note of the presence of a number of attorneys in court holding “watching briefs” for Baha Mar’s creditors, which, he said, “speaks to their significance to the economy.”

Mr Sweeting noted that there were 13 days between the present proceedings and the hearing scheduled for July 20 in a Delaware court and expressed concern of applications being made by other creditors making applications to be joined as parties to the pending request while negotiations were taking place among the major stakeholders.

Mr Simms, in his contribution to the brief hearing, also agreed to an adjournment and recommended that a status hearing prior to the July 20 substantive hearing “be a chamber (hearing) update as to not prejudice the negotiations in any way.”

He also suggested that the creditors could make applications at another hearing.

Justice Winder expressed concern with having a large number of parties involved in the application.

Mr Gomez said counsel for other creditors have approached the respondents “with intent to be in a watching brief situation.”

He said depending on the outcome of the negotiations, “there may not be a pressing need to limit the amount of counsel.”

Lester Mortimer, lawyer for Cable Bahamas Ltd, told the court that he would be following the proceedings closely on his client’s behalf before a determination is made as to whether it would become a party to the proceedings.

Cable Bahamas is one of Baha Mar’s creditors.

Sean Moree, attorney for China Construction America Bahamas Ltd, said it was his client’s intent to file an application to be a party to the proceedings as China EXIM and the government had done at last Thursday’s hearing.

Mr Moree received no objections from the attorneys present, as all three confirmed that CCA would also be a part of negotiations in the oncoming days.

The proposed date of July 20 was agreed to among all parties and the judge also set a status hearing for July 14 to be held in chambers.

Justice Winder said if a solution was reached before July 14 and/or July 20, they were to give him two days notice in advance and the matter could be heard before the dates set.

Baha Mar released a statement after the hearing, which said: “Baha Mar’s singular focus is to do all it realistically can to enable Baha Mar to be completed and opened successfully as soon as practicable. Therefore we welcome the parties’ agreement today to our motion for the adjournment of these proceedings to July 20.

“We look forward to engaging in substantive discussions with the parties to try and reach a consensual resolution that will allow us to move forward, and acknowledge the government’s constructive role in those conversations.”

On June 29, Baha Mar and its affiliated companies filed for bankruptcy in a Delaware court, blaming the resort’s contractor, CCA, for the construction delays that caused it to miss previous opening deadlines.

The resort also took legal action last week Tuesday against CCA’s parent company, China State Construction Engineering Company in England’s High Court of Justice.

Last Wednesday, US Judge Kevin Carey approved the resort’s request to begin tapping into $80m in financing to keep the resort on track for opening while it undergoes Chapter 11 bankruptcy proceedings in that state.

However, the Delaware judge’s approval of the debtor-in-possession (DIP) financing request, to include $30 million to be used by the resort over the 30 days, was conditional on the approval of the Bahamas’ Supreme Court.

Part of this report was unfortuntately omitted from yesterday’s Tribune.

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