KA and KM Development ("Lake Eve")

KA and KM Development, Inc., Debtor; Bankruptcy Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court for the Middle District of Florida, Orlando Division

This is the official site for creditors to obtain updated bankruptcy case information from the Unsecured Creditors Committee of KA and KM Development, Inc. Updates will be posted on this site when there is a newsworthy event.

The information contained herein presents general information about Broad and Cassel and the KA and KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel and review the online pleadings filed with the U.S. Bankruptcy Court to the extent not posted herein.

Please refer to the Notice to Unsecured Creditors you received in the mail in September 2009 for further creditor information procedures. For easy reference, the Notice is dated September 1, 2009.

The Committee is currently meeting weekly on Wednesday evenings due to the complexity of the case and will meet more or less often as the case issues or activities dictate.

Updates

Case Update

6/21/2010

Please see the attached Order. For your convenience we have also included the Schedule A that was attached to the Motion. Pursuant to paragraph 5 of the Order the deadline to object to the distribution schedule is JULY 8, 2010. Thereafter, SunTrust will disburse the funds.

Click here to view DE466 Order Granting Motion Directing Suntrust Bank to Disburse Escrow Deposits and to Maintain Other Funds in Escrow.

Click here to view DE465 Schedule A.

Hearing Proceeding Memo Hearing Held Ruling 1 - 5

6/11/2010

The bankruptcy Court continued items numbered 1-5 until June 16 at 2:00 pm (Orlando time) since no counsel for these particular unit owners appeared.

To give these unit owners the best possible opportunity to explain to the Court why they did not respond to the Objections to Claims last fall they need to either appear through their attorneys or contact Judge Jenneman's calendar clerk Dan Munoz at 407-648-6906 to make arrangements to appear by telephone.

Please share this information on your blog. I will also post on our website. If you know any of these individuals or how to contact them directly please make sure to the best of your ability, that they are aware that the Court has given them one last opportunity to explain why they failed to timely respond to the claims objections.

Sent on behalf of Roy S. Kobert - dictated but not read.

Click here to view

Order Extending Class 3 Option Deadline to 5/5/10

4/4/2010

Click here to view

Plan Confirmed and Claims Objections

3/25/2010

Plan Confirmed and Claims Objections

CASE UPDATE: KA & KM Development, Inc. (the “Debtor”), Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division. Dated: March 24, 2010.

Plan Confirmed

The hearing on the Debtor’s Plan of Reorganization was held on March 24, 2010. The Court confirmed the Debtor’s Plan.

The Court also granted the Committee’s Motion to allow unsecured creditors to continue to file ballots after the March 17, 2010 ballot deadline for the limited purpose of electing Options 1 or 2 for their claims. If you have not submitted your ballot form to the Court, please fill out the form, select Option 1 or Option 2 and send it to the Clerk of the Bankruptcy Court at the address listed on the ballot form. If you did file a ballot but you voted to reject the proposed Plan, please fill out another ballot form indicating whether you prefer Option 1 or Option 2. You must file the ballot form with your election no later than May 5, 2010. If you do not file your election, unsecured creditors with allowed claims will be treated under Option 1.

If you need more information on Options 1 and 2, please see Solicitation Letter under the March 9, 2010 link on this website labeled “Solicitation Package”. Also included within the link is a copy of the ballot form in .pdf format that you can download and fill out.

Claims Objections

Now that the Plan is confirmed, we will follow-up with Debtor’s counsel to file withdrawals of the Debtor’s Objections to Claim for those creditors who filed responses.

We are aware that some of the creditors who filed responses have received Orders granting the Debtor’s Objection to their claim. The Committee’s counsel is prohibited from assisting you with your individual claim. However, we did request that the Court move all hearings on claims to a new date. The Court has scheduled a hearing on April 28, 2010 at 10:15 a.m. to hear any unresolved claims objections.

Creditors who have filed responses but received the Court Order should take action on their own and write to the Court as soon as possible. You should attach all documents proving that you did timely respond to the Objection. Please send your letters to the Clerk of the U.S. Bankruptcy Court, 135 W. Central Blvd., Suite 950, Orlando, FL 32801. The letter should reference the Debtor’s name and the Case Number listed above in the heading. A copy of your letter should also be sent to the Debtor’s attorney, Elizabeth A. Green, Esquire, Baker & Hostetler, 200 South Orange Avenue, Suite 2300, Orlando, FL 32801-3432.

If you do not hear anything from Ms. Green’s office about your letter, please contact her office directly at (407) 649-4000 in an effort to resolve the matter prior to the April 28 hearing.

*******

The information contained herein presents general information about Broad and Cassel and the KA & KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel.

Please refer to the Notice to Unsecured Creditors you received in the mail in September 2009 for further creditor information procedures. For easy reference, the same Notice is posted here that was posted in the September 2, 2009 update.

Solicitation Package

3/9/2010

TENTATIVE SETTLEMENT REACHED AT MEDIATION

2/17/2010

CASE UPDATE: KA & KM Development, Inc., Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division. Dated February 17, 2010.

As directed in the Court's November 17, 2009 Order Directing Contested Matters to Mediation, the members of the Official Committee of Unsecured Creditors participated in a mediation on November 30, 2009 and December 1, 2009 with KA and KM Development, Inc. and SunTrust Bank.

At mediation, a Settlement Agreement was entered into by the Official Committee of Unsecured Creditors, KA and KM Development, Inc., Arti Kalidas, Vinod Kalidas, Nirmaksee Kalidas, and SunTrust Bank that will resolve the claims of certain unit purchasers with respect to the Lake Eve development. Earlier , SunTrust Bank notified counsel for the Official Committee of Unsecured Creditors that SunTrust Bank has agreed in principle to the loan modification referenced in Paragraph 4 of the Settlement Agreement, subject to the resolution of certain details and the internal approval procedures of SunTrust Bank. A copy of the Settlement Agreement is available here.

The Official Committee of Unsecured Creditors received Monday night, February 15, 2010, an intial draft of KA and KM Development, Inc.'s Plan of Reorganization and Disclosure Statement. Counsel for the Official Committee of Unsecured Creditors has transmitted comments to the Plan of Reorganization and Disclosure Statement to counsel for KA and KM Development, Inc. Presuming that such comments are incorporated into the Plan of Reorganization and Disclosure Statement, the Official Committee of Unsecured Creditors intends to seek the approval of the Court to include a solicitation letter summarizing the contents of the Plan of Reorganization and Disclosure Statement with KA and KM Development, Inc.'s solicitation package. A copy of the proposed solicitation letter explaining your availalbe options is available here.

*******

The information contained herein presents general information about Broad and Cassel and the KA & KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel.

Please refer to the Notice to Unsecured Creditors you received in the mail in September 2009 for further creditor information procedures.

Order Granting Motion to Extend Time Until January 6, 2010

12/9/2009

Order Granting Motion for Turnover of Property of the Estate

12/7/2009

Schedule of Deposits

12/7/2009

ESCROW DEPOSITS

11/24/2009

CASE UPDATE: KA & KM Development, Inc. (the “Debtor”), Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division. Dated: November 24, 2009.

Yesterday, the bankruptcy Judge executed the attached Court Order has entered which contained, as Exhibit “A”, a schedule (the “Schedule”) prepared by the former Escrow Agent, TitleConcepts, LLC, with the following information:

a. The name and address of each unit purchaser for whom the former Escrow Agent held a deposit;

b. The amount of the total deposit received by the former Escrow Agent from each unit purchaser;

c. The amount of the deposit that has been disbursed by the former Escrow Agent to the Debtor; and

d. The amount of the deposit remaining in escrow with the new Escrow Agent, SunTrust Bank.

Please review the Schedule carefully. This Schedule was prepared by the former Escrow Agent and has not been verified for accuracy by the Committee or Broad and Cassel. The Court has entered the attached Order that requires you to file an objection (an “Objection”) with the Court if you disagree with the information contained in the Schedule “A” regarding your deposit(s). The deadline to file your Objection is December 22, 2009. A copy of the Order is also attached to this posting for your reference.

It is important to act quickly in order to avoid missing the deadline if you believe the information contained in the Schedule is incorrect. If you do not file an Objection, the information forth on the Schedule will be deemed correct. Objections are required to be filed on or before December 22, 2009. (Unlike the deadline for responses to claim objections, the Committee is NOT pursing a request of an extension of this deadline.)

Please send your Objections to the Clerk of the U.S. Bankruptcy Court, 135 W. Central Blvd., Suite 950, Orlando, FL 32801, if you do not agree with the information contained in the Schedule. The Objection should reference the Debtor’s name and the Case Number listed above in the heading. A copy of your Objection should also be sent to the Debtor’s attorney, Elizabeth A. Green, Esquire, Baker & Hostetler, 200 South Orange Avenue, Suite 2300, Orlando, FL 32801-3432 and the attorney for SunTrust Bank, Jules S. Cohen, Esquire, Akerman Senterfitt, 420 South Orange Avenue, Suite 1200, Orlando, FL 32801-4304. Please note that any Objection sent to Broad and Cassel will be for informational purposes only and will not be filed with the Court for consideration.

You may file an Objection on your own with the Clerk of the Court, or you can hire your own attorney to represent you. You will receive a written notice of any hearing scheduled on your Objection to the Schedule if you file an Objection.

As counsel to the Committee, Broad and Cassel is prohibited from assisting you with preparing and filing your Objection to the Schedule.

*******

The information contained herein presents general information about Broad and Cassel and the KA & KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel.

Please refer to the Notice to Unsecured Creditors you received in the mail in September 2009 for further creditor information procedures. For easy reference, the same Notice is posted here that was posted in the September 2, 2009 update.

See November 23, 2009 Order Granting in Part and Denying in Part Unsecured Creditor Committee’s Motion for Transfer of Custody (But Not Control) of its Constituents’ Funded Escrow Deposits.

OBJECTIONS TO CLAIMS

11/23/2009

CASE UPDATE: KA & KM Development, Inc. (“Lake Eve”), Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division. Dated: November 23, 2009.

KA & KM filed a series of Objections to Claims in early November. Please note that every creditor may not have been listed in these Objections. If your claim was objected to, you will receive a written notice from KA & KM’s attorney.

If you disagree with the Debtor’s Objection to your claim, it is important that you file a response with the Court on or before the deadline. Responses are required to be filed within thirty (30) days of the date of the Objection was sent to you, not the date you received it. Original objection should be sent to the Clerk of the U.S. Bankruptcy Court, 135 W. Central Blvd., Suite 950, Orlando, FL 32801, if you do not agree with the treatment of your claim as stated in the Objection. You will find the date of the Objection on one of the last pages under the heading “Certificate of Service”. To play it safe, you should send your response so that it is received by December 4, 2009. (Due to the UK postal strikes, the Committee is asking the Court to extend the response deadline. If the request is granted, the Committee will post such notification on its website.) A copy of your response should also be sent to the Debtor’s attorney, Elizabeth A. Green, Baker & Hostetler, LLP, 200 South Orange Avenue, Suite 2300, Orlando, FL 32801. Please note that any responses sent to Broad and Cassel will be treated as a courtesy copy for informational purposes only and will not be filed with the Court for consideration.

You may file a response on your own with the Clerk of the Court, or you may hire your own attorney to represent you. In the event you file a response in opposition to an objection, a hearing will be scheduled on your the claims objection. You will receive a written notice of any hearing scheduled on an objection to your claim if you filed a response.

As counsel to the Committee, Broad and Cassel is prohibited from assisting you with interpreting the Objection to your particular claim, nor can we assist you with preparing and filing your specific response to the Objection. However, we are providing some general suggestions for you to consider when preparing your response so you or your counsel can determine if they are applicable to your particular situation. You may have other unique responses not listed here based on your own facts and circumstances.

Section III of the Objection you received may contain one or all of the following subparagraphs. These are generic suggestions you could consider when preparing your response for your claim:

H. KA/KM is excused from performance under the Unit Contract because Claimant committed a prior material breach.

You may dispute whether KA/KM (“Debtor”) has performed all of its duties under the Contract for Purchase and Sale (the “Contract”). For example, the Debtor may not have tendered a deed to the Unit to the purchaser and demanded that the purchaser make the payment required by the Contract. Further, even if you failed to close as scheduled, the Debtor may have waived the default by agreeing to extend your closing by not setting a new closing date. Further, following a default, the Debtor may not have sent a notice of default to you demanding that you close, which may mean that you still have the right to close. There may be other things the Debtor promised only you and failed to perform.

J. Claimant is not entitled to a claim for unjust enrichment.

Unjust enrichment means that if a party receives money or other property unfairly and at the expense of another by chance, mistake, or without any personal effort, the recipient should return the property to the rightful owner. Depending on which party defaulted under the Contract as outlined in paragraph H above, a claim for unjust enrichment may be available to the purchaser.

K. Claimant has failed to provide any evidence that a deposit was paid.

Evidence of your deposit should not be required to maintain a claim unless the Debtor refutes the fact that a deposit was ever made. However, proof of your deposit can be provided to the Court in many ways. For example, you can provide the Court with a copy of a cancelled check, wire confirmation, or deposit receipt. Paragraph 2(a) of the Contract states, “Escrow Agent shall give Purchaser a receipt for his deposit upon his request.” Additionally, Florida law requires the Escrow Agent to give a purchaser a receipt for the purchaser’s deposit, upon request. The Escrow Agent under the Contract is TitleConcepts, LLC (the “Escrow Agent”). You can request a receipt for your deposit from the Escrow Agent by contacting the Escrow Agent. It is our understanding that the Escrow Agent’s current address is 121 South Orange Avenue, Suite 1470, Orlando, Florida 32801; (407) 849-9403 (phone); (407) 428-1630 (fax). Further, it is our general understanding that the Debtor sent a letter to some or all of the purchasers, dated December 22, 2008, acknowledging that a deposit equal to 30% of the purchase price was placed in escrow upon execution of the Contract with the Debtor.

Finally, you may wish to consider the following when preparing your response to Section III, Subparagraph I:

I. Claimant’s claim is not entitled to priority treatment under 11 USC § 507(a)(7).

§ You may dispute the fact that the condominium was intended and available for personal use or family use, even if that use was one of many uses which was to be made of the unit.

§ The sample contract for purchase and sale that we have reviewed does not state that the condominium can be used only for commercial or business purposes nor does it state that the condominium may not be used for personal or family use. You should review the terms of your individual contract for purchase and sale, as each contact may not be the same.

§ It may be disputed that the deposits were made, not for a business purpose, but for the personal use and enjoyment of the individual purchasers.

§ You may be able to present documents to show that a deposit was made for purchase of the condominium for personal use or family use. For example, the sample Declaration of Condominium which we have reviewed does not prohibit personal use or family use of the condominium units. Also, the Prospectus we reviewed states that, “As a general proposition, each Unit is to be occupied by a family, its servants and guests, as a residence and for no other purpose.” It also provides that, “Residential Units may be leased, sublet, or rented………”In addition, financing documents may show that the debt to be incurred for the purchase of the condominium was to be consumer debt rather than debt incurred for business ventures or other profit-seeking activities.

§ Regardless of whether there could be business use made of the condominium, you may be able to provide evidence that the deposits made were for purchase of a condominium which, at least in part, was for the purchaser’s private or family use and enjoyment.

* * *

The information contained herein presents general information about Broad and Cassel and the KA & KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel.

Please refer to the Notice to Unsecured Creditors you received in the mail in September, 2009 for further creditor information procedures. For easy reference, the same Notice is posted here in the September 2, 2009 update.

Mediation

11/20/2009

CASE UPDATE: KA & KM Development, Inc. (“Lake Eve”), Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division. Dated: November 20, 2009.

On November 17, 2009, the Court entered an Order Directing Contested Matters to Mediation. The Court directed the following parties to participate in the mediation:

a. KA and KM Development, Inc.

b. SunTrust Bank

c. the Official Committee of Unsecured Creditors

d. All Claimants whose claims have been objected to.

If your particular claim has been objected to, you should have received an Objection to Claim. A copy of the Court’s Order on mediation is attached to this posting.

The Mediation will be held on November 30, 2009 and December 1, 2009 at the Law Offices of Baker & Hostetler LLP, 200 S. Orange Ave., SunTrust Center, Suite 2300, Orlando, FL 32801-3432, beginning at 9:00 a.m., Orlando time each day and lasting all day.

DAY 1: The mediation on November 30, 2009 will address the separate lawsuits filed by certain unsecured creditors against the Debtor, the Debtor’s principals and SunTrust Bank.

DAY 2: The Mediation on December 1, 2009 will address all other unsecured creditors. (Unsecured creditors who filed a lawsuit and participated on Day 1 are welcome to participate on Day 2.)

Members of the Committee will attend both days of mediation in person. We understand that travel to the United States for mediation would be difficult for creditors overseas. To accommodate the unsecured creditors, the Court Order provides you with 2 options to participate in the mediation:

A. On December 1, 2009 utilize the telephone conference call in option beginning at 2:00 p.m. Orlando time/7:00 p.m. UK time. The call in phone number, following the USA Country Code is: 00 1-888-853-9376, Passcode: 4076494036 followed by the “pound” or “hash” (#) key.

OR

B. You may fill out and sign the attached Limited Proxy for Use Related to Court Ordered Mediation which allows the Committee to act on your behalf during the mediation only. (You are still invited to dial in under option “A”, but it is not required with an executed Proxy.) Send your signed proxy to Roy S. Kobert, P.A., Broad and Cassel, 390 N. Orange Avenue, Suite 1400, Orlando, FL 32801 (email address c/o Ronnie Owens – rowens@broadandcassel.com). So as to arrive at Broad and Cassel by no later than November 30, 2009.

IT IS IMPORTANT THAT YOU ACT ON ONE OF THESE OPTIONS IMMEDIATELY.

You can elect (i) “A” OR “B” or (ii) “A” and “B”. However, you must pick an option.

BLOGGING DURING MEDIATION

During the Mediation, the Committee members present (i) will provide periodic updates on the mediation process; and (ii) allow you the opportunity to ask questions or provide the Committee with real time feedback during the Mediation. Access to this site will be open to all unsecured creditors in the case (including unsecured creditors who have also filed a lawsuit). If you would like access to the internet blog, please send your request by email to Broad and Cassel at rowens@broadandcassel.com by November 30, 2009. We will email the blog instructions and password to you when it is established by the Committee. Please do not share the password with anyone who is not an unsecured creditor.

*************

The information contained herein presents general information about Broad and Cassel and the KA & KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel.

Please refer to the Notice to Unsecured Creditors you received in the mail in September 2009 for further creditor information procedures. For easy reference, the same Notice is posted here in the September 2, 2009 update.

Limited Proxy for use Related to Court Ordered Mediation

11/20/2009

Click here to view

DE205 Order Directing Mediation for Contested Matters

11/20/2009

Click here to view

Case Update

9/29/2009

CASE UPDATE: KA & KM Development, Inc. (“Lave Eve”), Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division. Dated: September 29, 2009.

REMINDER: The court deadline for creditors to file a Proof of Claim in the case is October 2, 2009. Your claim must be received by the Clerk of the U.S. Bankruptcy Court on or before October 2, 2009 to be considered filed timely.

All claims must be filed with the Clerk of the Court, 135 West Central Blvd., Suite 950, Orlando, Florida 32801. Proofs of Claim sent to counsel for the Creditors Committee are not considered “filed” claims and only those claims filed with the Bankruptcy Court shall be eligible to receive a distribution. Claims sent to the Creditors Committee or its counsel shall be considered a courtesy copy for our information only.

The information contained herein presents general information about Broad and Cassel and the KA & KM Development, Inc. bankruptcy and is not intended to constitute legal advice. Before acting on any of the materials presented here, you are advised to seek your own legal counsel.

Please refer to the Notice to Unsecured Creditors you received in the mail in September 2009 for further creditor information procedures. For easy reference, the same Notice is posted here in the September 2, 2009 update.

Website Frequently Asked Questions

9/29/2009

KA & KM Development, Inc. (“Lave Eve”), Case No. 6:09-bk-06245-KSJ, United States Bankruptcy Court, Middle District of Florida, Orlando Division

FREQUENTLY ASKED QUESTIONS

Q. Why is the value shown in Schedule F one-third the value of my deposit?

A. This is the amount the Debtor values your deposit. It is important that you file a Proof of Claim using the Form B10 with the amount you consider is owed to you. Unless and until the Debtor objects to your claim, the amount of your claim will tromp over the amount listed in Schedule F.

Committee Questionnaire (Deadline 9/22/09)

9/15/2009

Click here to view

Motion to Transfer Custody

9/14/2009

Click here to view

Notice to Unsecured Creditors

9/2/2009

Click here to view