Buzz FX Bankruptcy Restructuring Success
The following appeared in The Gazette (Montreal) on July 23, 1997. The citation is 1997-07-23. Buzz is back: creditors okay deal. The Gazette (Montreal); Business, p. C9.
Buzz is back: Creditors okay deal
The bloom is back at Groupe Image Buzz following acceptance by creditors of a new repayment plan.
The locally-based animation, visual-effects and post-production house offered to pay $ 1.3 million within 30 months to 70 suppliers and unsecured creditors - about 93 per cent of what they were owed when Buzz sought protection on May 30.
The creditors voted 50-1 to accept the proposal at a meeting last week, said Michel Desjardins, Buzz's vice-president (communications.)
Those owed $ 5,000 or less should get their money by Oct. 30.
Holders of $ 2.3 million in debentures have agreed to convert their loans into shares that will be bought back over 10 years.
Buzz got into financial difficulty largely because of a $ 3-million contract with Hanna-Barbera Cartoons Inc. to provide 100 minutes of 3-D animation for the TV series The Adventures of Jonny Quest, Desjardins said. The contract cost the company more than it was bringing in, until Buzz finally got out of it.
Buzz, which employed and continues to employ 53 people, "is not in bad shape," Desjardins said.
"The problem came from that contract, which dug a big hole in our cash flow. We had to restructure, make the operation leaner."
Buzz administrator Gilles Massicotte said the company's business partners and employees have been remarkably supportive.
"In the months to come," he said, "Buzz will demonstrate more than ever its dynamism and determination to be a leader in its field."