CERTIFIED PUBLIC ACCOUNTANTS
 
FRAUD EXAMINERS  
 
RESTRUCTURING ADVISORS

 

Creditor

Bionol Clearfield, LLC

Bionol Clearfield, LLC

On July 20, 2011, Bionol Clearfield, LLC, along with two affiliated companies, Bionol Clearfiled Holdco, LLC and BioEnergy Holdings, LLC filed for Chapter 7 Bankruptcy protection, resulting from a contract dispute with Getty Petroleum Marketing, Inc. All three companies are based in Clearfield, PA.

Bionol Clearfield Holdco, LLC's sole asset was its 100% stock ownership interest in Bionol Clearfield, LLC, and deemed to have no value.

Bioenergy Holding, LLC had scheduled assets of $11,423,512.21, which primarily consisted of a note receivable from BioEnergy International, LLC. As part of the DIP financing, the Chapter 7 Trustee, Alfred T. Giuliano (the "Trustee") carved out this asset for the benefit of the estate. The Trustee later determined that this asset was substantially uncollectible since the only asset remaining of BioEnergy International, LLC was a parcel of real estate that was part of the ethanol plant's footprint. The Trustee negotiated with BioEnergy and obtained the property for the estate so that it could be sold to Pennsylvania Grain Processing in the sale of property within the Bionol Clearfield LLC estate. The agreed upon price is $100,000.

Bionol Clearfield, LLC was an Ethanol manufacturing facility located on a 34.26 acre property in Clearfiled, PA. At or around the time of the Bankruptcy filing, assets included:

  • Ethanol Manufacturing Facility - Estimated Value of $31,009,590.27
  • Plant Equipment - $49,107,889.57
  • Cash on Hand - $3,533,916.89
  • Miscellaneous Security Deposits - $493,420
  • Miscellaneous Accounts Receivable - $2,388,421.97
  • Miscellaneous office furniture and equipment - $666,768.56
  • Inventory - $1,664,826.00
  • Debt Issuance Costs - $5,350,187.28
  • Arbitration award against Getty Petroleum Marketing, Inc. (GPMI) for approximately $230,000,000.

SALE OF ASSETS

In February 2012, the Trustee commenced efforts to schedule auction procedures for the sale of certain assets and real estate property of Bionol Clearfiled. This auction resulted in a sale of all real estate and plant equipment to Pennsylvania Grain Processing, LLC. Included in the sale, were the ethanol plant, related plant equipment, inventory on hand, as well as miscellaneous office furniture and equipment, for a total of $9,991,898.55

ADDITIONAL CASH COLLECTIONS

In addition to the property sale, the Trustee has secured the return of $200,000 in security deposits, $42,676.48 in miscellaneous refunds, and $182,033.21 representing the balance of retainers from professionals. The Trustee has also collected $18,404.00 in accounts receivable, and secured the turnover of $3,008,791.01 in cash from various financial institutions.

GPMI LITIGATION AND JUDGMENT

Since the commencement of the case, the Trustee has pursued collection of the judgment against GPMI for damages resulting from a breach of contract, which they obtained on July 21, 2011. GPMI filed for bankruptcy protection in the southern district of NY (Case No: 11-15606) on December 4, 2011. After a hearing and legal argument, the Bankruptcy Court Judge in the GPMI matter determined that Bionol had an allowed claim for $234,823,135.72 against the estate of Getty Petroleum for the amount of the judgment plus interest. GPMI's unsecured creditors, of which Bionol is the largest, put forth a Chapter 11 plan that was confirmed by the GPMI Judge in August 2012. Pursuant to the plan, the Bionol Trustee became the Liquidating Trustee of the GPMI Liquidating Trust. The Trust prosecuted litigation against LukOil that resulted in a settlement in July 2013 for $93 million. The Trust paid cost of litigation and Chapter 11 claims in full. The Trust has since resolved the Getty Realty Claim. Distributions to date from the Trust to Bionol have been $24,503,553.59. The Trust has targeted final distribution, which will be significant, to creditors prior to the end of 2015.

AVOIDANCE ACTIONS

The Trustee has issued demand letters to 54 vendors to avoid preferential transfers. In addition to these demand letters, the Trustee has engaged in 14 adversary cases. The total amount of transfers to these 68 vendors was $5,785,311.71. To date, $549,870.33 has been collected through these actions. All avoidance actions are now complete and fully administrated.

OUSTANDING PROFESSIONAL FEES

There are currently two outstanding professional fee applications:

  • CRG Partners, LLC - $16,481.22
  • Thomas M. Hoole - $6,649.96