Feb. 7, 2007 — Innovative Communication Corp. owner Jeffrey Prosser is working on a plan to settle the debt with his creditors. However, the plans hinge upon the court upholding a $402 million settlement agreement previously negotiated between the two parties — an agreement that representatives from the Rural Finance Telephone Cooperative and Greenlight Companies have said is currently "unacceptable" and no longer valid because Prosser failed to meet his financing deadlines.
During a creditors meeting held Wednesday at District Court on St. Thomas, Prosser laid out at least three initiatives that he said would cover the $402 million (plus interest), which includes the sale of two of Prosser's cable television companies in Martinique and Guadeloupe and the possible sale of the V.I. Telephone Co. to the Government Employees Retirement System.
While GERS Administrator Willis C. Todmann has said he is unsure whether a deal between ICC and the retirement system "will be consummated," Prosser said Wednesday that the GERS Board of Trustees will be meeting on Feb. 15 to select a financial advisor who will "handle" the financial aspects of the purchase.
Late last month, Prosser's camp issued a statement regarding the sale of the two French companies, with a price set at $70 million (See "Prosser Sells French Island Cable Companies for $70 Million"). During Wednesday's meeting, Prosser said money garnered from the sale — which is scheduled to close on March 25 — would be credited against the proposed $402 million figure.
Prosser said that "due diligence" is also being conducted on the possible sale of a cable company located in France. Although he said, "the price for that company has not yet been set," Prosser estimated its worth to be approximately $25 million."
Prosser added that discussions are currently ongoing between Rothschild, an international investment bank, and two unspecified banks and hedge fund companies to obtain the financing needed to pay down the remainder of the debt.
"It's my view that the $402 million, if upheld by the court, would settle all the claims of RTFC and Greenlight filed against the debtors," he said.
Over the past two days, however, Prosser's creditors have said that they would not be accepting the $402 million figure, included in a settlement agreement reached last year.
During a hearing held in District Court on Tuesday, Gregg Galardi, representing Greenlight, said the agreement is no longer binding since Prosser failed to meet a deadline for financing.
Prosser's Assets and Debt
During Wednesday's meeting, Assistant U.S. Trustee Guy G. Gebhardt put on record a list of Prosser's assets, which include a number of properties and companies located throughout the Caribbean, Europe and the U.S. mainland. In addition to his local businesses — including the Daily News Publishing Co., which has not been included in the list of companies up for sale — Prosser also has subsidiary companies in the British Virgin Islands, Curacao, Bonaire and St. Martin.
In response to questions posed by Galardi about his income, Prosser said that he is "allocated" $120,000 every two weeks by New ICC, one of his V.I. subsidiary companies. Prior to filing for bankruptcy, the allocation was paid by ICC-LLC (a limited liability company located in Delaware) and Emerging Communications Inc.– both co-debtors in Prosser's bankruptcy cases.
In addition to having stock in numerous other ventures, including a telecommunications company in Belize, Prosser is also the majority shareholder and joint owner of the V.I. Community Bank (VICB). During Wednesday's hearing, Prosser said the stock is being used as collateral on a loan from Banco Popular, which he said was initially taken out to purchase the VICB stock.
A representative from Banco Popular said Wednesday that Prosser currently owes the bank $400,000 for purchases charged to credit cards issued to 31 top ICC executives. The limit on the credit cards range from $5,000 to $200,000.
Prosser said that the cards were generally used for "business expenses," and the cardholders were required to file an expense report at the end of each month. However, he said the cards have not been used since last July.
During a hearing held Tuesday, U.S Bankruptcy Court Judge Judith K. Fitzgerald estimated Prosser's debt at around $650 million, for which interest is accruing at a rate of approximately $12 million a month. "That's a lot of money. And since June 2005, not a penny has been paid," she said.
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