Two competing plans to take the Baltimore Jewish Times' publisher out of bankruptcy have been taken off the table, and talks continued Tuesday between the company and a key creditor after a judge approved an emergency cash infusion.
Alter Communications Inc.'s lawyer, Alan M. Grochal, said Tuesday that two proposals for the bankruptcy court to consider recently fell through, although the major investors involved in each one are interested in working on new arrangements. He said negotiations are continuing, with a hearing scheduled Wednesday morning U.S. Bankruptcy Court to either present a plan or request more time.
Andrew Alter Buerger, Alter's chief executive officer and vice president, said the tone of often-rancorous discussions between Alter and its main creditor and former printer, H.G. Roebuck & Son Inc., seems better.
"People are finally putting down the swords and picking up the pens and figuring out how this can work," Buerger said early Tuesday afternoon, as he and lawyers for both sides ended their hearing on the emergency loan and returned to private meetings. Reached later in the afternoon, Buerger said both sides seemed "very motivated" to reach agreement, and he expected talks to last into the night.
Since Alter filed for Chapter 11 reorganization in the spring of 2010, the two sides have failed to reach an agreement, and in recent court filings each side accused the other of acting in bad faith. Alter's bankruptcy came months after it lost a breach-of-contract suit filed by Roebuck and was hit with a $362,000 Circuit Court judgment in 2009. Roebuck — one of about 40 creditors — claims that it is still owed about $1.4 million.
Edmund A. Goldberg, a lawyer with the Office of the U.S. Trustee, who has been monitoring the negotiations, told the judge Tuesday that both sides had made "herculean" efforts to reach a deal. He called the 93-year old Jewish Times — a magazine-format weekly with a paid circulation of about 8,500 — "an absolutely first-rate publication that has great community value." Alter also publishes Style magazine.
U.S. Bankruptcy Court Judge Nancy V. Alquist agreed that the two sides had been working hard the past few days. After approving a motion for an urgent loan, Alquist said "I hope this financing will be a bridge to a plan. I have been impressed with the coming together of the parties and I hope it will continue."
She referred specifically to the fact that Roebuck did not object to Alter's motion for the emergency loan, which Grochal argued the company needed to make it through the week.
Ronnie Buerger, an Alter co-publisher who owns a 45-percent stake in the company, agreed to lend $100,000 to Alter under conditions that would limit her risk. Roebuck and another key creditor, Wells Fargo, supported the motion, but it was initially opposed by Alter's landlord, 901 LLC of Owings Mills, which has been otherwise supportive of Alter.
Ronnie Buerger had already transferred the loan to the company Monday, but the judge had to approve terms under which the loan was made so that it could be used to pay urgent bills, including employee salaries, printing and the phone and Internet connection. David Dean, the attorney for the landlord of Alter's Park Avenue office, dropped his objection at the end of the hearing after Grochal agreed to include $8,000 toward a $47,000 back-rent bill in the list of payments covered by the loan.
Grochal said before the hearing that key investors in two competing reorganization plans offered by Alter and Roebuck could still be involved in a deal, but under new terms. Alter had proposed a plan that involved an investor group led by Dr. Scott Rifkin, a Baltimore physician turned health care entrepreneur, which had agreed to put up $600,000 in exchange for an 80 percent stake in Alter.
Roebuck's plan included an $800,000 investment by WJW Group LLC, the publisher of the Washington Jewish Week.
Grochal said "unresolved issues" emerged during close examination of the Rifkin deal. He said representatives of Washington Jewish Week spent much of the day Sunday at the Baltimore Jewish Times "looking at the books."
Neil Rubin, senior editor of news for the Baltimore Jewish Times, has not been privy to the negotiations, but he marveled at the complexity and length of the proceedings.
"This has taken so many turns it's dizzying," he said. "You couldn't do a flow chart of this."