Atty. Larry Yang

Six Flags Magic Mountain in bankruptcy

Tuesday, 04 August 2009 23:25 Atty. Lawrence Yang

PRACTICALLY every one in California has been to Magic Mountain at one time or another. Six Flags operates 20 theme parks in the US, Mexico and Canada. It’s a right of passage for kids in California to graduate from Disneyland to Magic Mountain as soon as they get to middle school. The company had 25 million visitors last year producing record revenues. Let’s assume the cost of a ticket is $40, that number of visitors would have generated $10 billion of gross receipts. We don’t know how the bottom line figures look like but despite the huge revenues, Six Flags is unable to sustain $2.4 billion of debt. At 10 percent interest, that level of debt would require $240 million of interest payment a year just to keep the debt current! Thus, the company filed for Chapter 11 bankruptcy reorganization last month. The purpose of the bankruptcy is to allow Magic Mountain to get rid of at least 75 percent of its debt. Instead of trying to pay off the $2.4 billion of debt, the company will get rid of $1.8 billion without any payment, through bankruptcy. This means that Magic Mountain will emerge out of bankruptcy court owing only $600 million of debt instead of $2.4 billion, just like magic.

Six Flags Magic Mountain in bankruptcy

Sunday, 02 August 2009 22:18 Atty. Lawrence Yang

This means the creditors will have to suffer a loss of 75 percent or $1.8 billion of money owed to them by Magic Mountain. Creditors will be given lifetime VIP tickets to the theme park in exchange for voiding 75 percent of the IOU’s. The company said that it inherited a "$2.4 billion debt load that cannot be sustained, particularly in these challenging financial markets…"

BK motion for relief

Sunday, 26 July 2009 20:58 Atty. Lawrence Yang

BANKRUPTCY law creates a protective shield around the debtor and the bankruptcy estate upon filing of the bankruptcy case. This is known as the "automatic" stay or injunction that stops all claims against the debtor on the date of filing of his bankruptcy petition. Claims against the debtor include the filing of a lawsuit or continuing a lawsuit that has been filed. It also includes levies, garnishments and other liens against the debtor’s assets and income, phone calls and collection letters, and creditor actions to get assets securing a loan, such as repossessing a car, or foreclosing on a house. But is the creditor without remedy?

GM and Chrysler both out of bankruptcy

Sunday, 19 July 2009 20:16 Atty. Lawrence Yang

THE new leaner and more competitive GM emerged out of bankruptcy court on July 10, 2009, forty days after it filed for bankruptcy protection. The good assets were sold to a new GM owned by the government and workers. The bad assets remain under the protection of the bankruptcy court, which is sorting out creditor claims against the assets. The good assets include the Cadillac and Chevrolet brands, which are profitable. The new GM comes out of bankruptcy court with only one fourth of the original debt carried by GM. It was able to get rid of 75 percent of accumulated debt in forty days in bankruptcy court with the profitable assets in tow. Last month, GM sold the Saturn line to Penske Automotive Group, and the Hummer line to a Chinese heavy machinery maker in Sichuan, China.

On the other hand, Chrysler was in and out of bankruptcy court in 45 days. The good assets of Chrysler were sold to Italy’s FIAT and the new Chrysler also shed off a lot of debt, and is now leaner and more competitive.

Like a thief in the night

Sunday, 12 July 2009 22:55 Atty. Lawrence Yang

MICHAEL Jackson’s death last week emphasizes the Biblical warning that death comes like a thief in the night. There are no exceptions. Even one as great and talented as Michael who had planned to start 50 concerts in England next week could not foresee that his life on earth was going to end last week. The best laid plans of mice and men are nothing before the Lord. So, here’s Michael, who is half a billion dollars in debt, required to work again at the age of 50 so that he start paying off his debt. He cannot sleep even with the use of prescription sleeping pills. If you had half a billion of debt, you wouldn’t be able to sleep either. Many clients complain that they cannot sleep and all they owe is $50,000 of credit card debt. Michael owes a thousand more times $50,000! Not being able to sleep is the least of his problems. His creditors have him by the neck. They literally own him. If they ask him to sing and dance, the only question he can ask is when and where. The latest investigation into his death reveals that Michael had been taking the strongest sleeping medicine available by prescription. The nurse practitioner that administered the drug said that Michael said that he could not sleep with regular prescription sleeping pills. The only drug that worked for him was administered intravenously and would knock him out completely immediately.

Debt and Michael Jackson

Tuesday, 30 June 2009 21:11 Atty. Lawrence Yang

MICHAEL Jackson died at the age of 50 last week. The world will miss his rare and tremendous musical talent. The immediate cause of death was cardiac arrest. But I believe his debts killed him. He had $400 million of debt! Not even the King of Pop can handle that kind of debt. The human body is not built to handle that kind of debt. In the eighties, he bought the catalog of Beatle songs for $48 million and his "Neverland" house in Santa Barbara for $15 million. It is estimated that his ownership of his own and the Beatle songs is currently worth $ 1 billion. But despite making hundreds of millions during his career as the most successful pop musician of all time, Michael Jackson owes between $400 to $500 million of debt.

Does hell exist?

Sunday, 28 June 2009 21:29 Atty. Lawrence Yang

(Part 2)

LAST month I wrote about Bill Wiese’s book called 23 Minutes in Hell. Jesus brought Bill to Hell to let him experience Hell and tasked him with the responsibility of telling people that Hell really exists. He said that he was placed in a prison cell carved from stone and there was no light but he could see that there were two hideous creatures with him in the cell. He knew that the creatures were evil and wanted to harm him. These creatures cursed God and hated God. Bill states that God is not in Hell. Thus, there is no good, no life, and no light in Hell because God is not there. It is there where Lucifer and his cohorts, his demons and minions have been banished forever by God. Unfortunately, humans who have not chosen to believe in Jesus as the Redeemer of Man are also banished there. Devils and demons torment the physical bodies of humans who go there but they do not die, they just feel the physical pain. But it is the absence of God in that place that creates the deepest feelings of hopelessness, despair and suffering, and complete absence of joy and happiness that will convince you to avoid going there at all costs.

Creditors appeal Chrysler sale to Fiat in BK court

Saturday, 20 June 2009 06:39 Atty. Lawrence Yang

Creditors appeal Chrysler sale to Fiat in BK Court

Tuesday, 16 June 2009 22:09 Atty. Lawrence Yang

CHRYSLER has been in bankruptcy for a little over a month now and is actually ready to get out of bankruptcy with the sale of most of its assets to FIAT. President Obama had indicated that he wanted Chrysler to have a quick prepackaged bankruptcy with the FIAT purchase and partnership, and it certainly looks that way. The Bankruptcy court has approved the reorganization plan, which calls in part for the sale of most of Chrysler’s assets to FIAT. The sale was about to take place when a group of secured creditors objected to the sale to FIAT claiming that the sale prejudiced their rights as secured creditors. Since Bankruptcy courts are Federal Courts, appeal is made to the United States Court of Appeals, and thereafter to the United States Supreme Court.