I found this on YAHOO...Hope this person is correct !
Legal Points of Chapter 11 Bankruptcy #1 kitty557_98
Jul 23 1998
9:02AM EDT
I am an attorney who regularly practices bankruptcy law. I have recently reviewed some of the messages on this board and felt the need to share some legal points with the readers on this thread. Unfortunately, I also hold shares of FPAM and, needless to say, am very disturbed by the events of this past few days. Since there have been lots of questions regarding the shareholders legal rights, I wanted to share a few points with you.
First of all, a Chapter 11 bankruptcy proceeding is codified under 11 U.S.C., of our Federal Bankruptcy Code. The shareholders of FPAM are considered "equity security holders" under 11 U.S.C. 101 (17). Under 11 U.S.C. 501(a), an equity security holder may file a proof of interest with the court. (This is similar to a proof of claim filed by a creditor. Please note that equity security holders are not considered creditors) It is suggested that all pre-petition equity security holders should file a proof of interest with the Clerk of the Court. You can probably obtain the required form and instructions at your local federal bankruptcy court.
11 U.S.C. 1102(a)(1) states."As soon as practicable after the order for relief under chapter 11 of this title, the United States trustee.may appoint .committees of equity security holders as the United States trustee deems appropriate. (This is why it is important that we all file our notices of interest and perhaps, even communicate with the U.S. Trustee) Under subdivision two of this same section, it states. "on request of a party in interest, the court may order the appointment of additional committees .of equity security holders if necessary to assure adequate representation of .equity security holders.
11 U.S.C. 1101 (b)(2). A committee of equity security holders appointed under subsection (a)(2) of this section shall ordinarily consist of the persons, willing to serve, that hold the seven largest amounts of equity securities of the debtor of the kinds represented on such committee.
It is my guess that several different levels of equity security holders committees will be formed, perhaps consisting of a committee of 1) institutional equity security holders, (ie. deep pockets.) 2)employee equity security holders (ie. those shareholders who sold their practices in exchange for this worthless stock; 3)large private investors similar to those shareholders being solicited on this thread by "FastTrial" ; 4)small private investors of $10,000.00 or less. Especially for the small investors and the large private investors, it is crucial that we make it clear to the Trustee that it is within our best interest to have our own committee. I am certain that FPA has already struck private side deals with their large equity holders. That is why management has now proposed that the equity holders interest be terminated thereby leaving the small investors holding the bag.
Once a shareholders committee is formed, the committee has broad powers and duties including the power to "investigate the acts, conduct, assets, liabilities, and financial condition of the debtor, the operation of the debtor's business and the desirability of the continuance of such business, and any other matter relevant to the case or to the formulation of a plan." The most important power is the committee's power to accept or reject the plan. 11 U.S.C. 1103 ( c ) 2 & 3.
I hope that some of the above information is of assistance to this thread. The proposals made to terminate the equity holders interest are just proposals. I hope I have made it clear that the shareholders have rights as enumerated above. I think the most important issue will come down to a determination of just how much FPAM is worth. It may serve us well to start gathering as much information as we can from the articles and filings we have seen to date. I do not believe that this company is worthless as management would have us believe. Otherwise, why should the shareholders shares become worthless.
Thank you for taking the time to peruse this message. For those of you who have access to Silicon Investor, please post a copy of this message on that thread because I am not a subscriber. Please let me know if I may be of further assistance. This whole situation has me so upset that I have considered attending the committee meetings, the 341 hearing and the court hearings or perhaps appearing on behalf of private shareholders.
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