Good Enterprises offers debt-settlement deal

Feb. 18--Land and other assets of Good Enterprises would be sold to repay the $6.2 million owed its lender under a proposal disclosed Friday.

The procedure is spelled out in an agreement between Christine Shubert, the trustee handling Good Enterprises' liquidation, and Susquehanna Bank.

The 13-page agreement was filed in U.S. Bankruptcy Court in Philadelphia.

To go into effect, it needs the approval of U.S. Bankruptcy Judge Jean K. FitzSimon.

FitzSimon has set a hearing about the proposal for 9:30 a.m. on March 19.

Good Enterprises was known for its Good Books division plus its Old Country Store, cooking store and ice-cream parlor in Intercourse.

The family business closed and filed for bankruptcy liquidation in December.

The shutdown idled 36 employees, including owners Merle and Phyllis Good and their two daughters.

Good Enterprises owes $6.2 million to the bank - its biggest creditor by far - on three secured loans totaling $8.2 million, borrowed from 2005 to 2009.

Susquehanna has liens on most of Good Enterprises' assets.

These include store inventory, quilts, paintings, antiques, unsold books and $441,000 in deposit and escrow accounts at Susquehanna.

The bank also has liens on the cooking store property, a 2-acre parking lot and 26.6 undeveloped acres, all in Intercourse and all owned by Good Enterprises.

Under the proposal, Susquehanna would keep the funds that Good Enterprises has in the bank accounts.

To turn the other assets into cash, the trustee would hire an auctioneer and broker to sell them.

Most of the net proceeds - after commissions, transfer taxes etc. - would go to the bank.

But Shubert would get $250,000 of the proceeds to pay the professionals she has hired to help.

These are a law firm, accounting firm and consultant Dean Mast, the former business manager of Good Enterprises.

The bank would get the proceeds of the sale of the assets plus the $441,000 in the bank accounts, up to $6.2 million.

Excess proceeds would go to the trustee, to be dispersed to other creditors.

Until the assets are sold, Susquehanna would be responsible for paying real estate tax on the Good Enterprises' properties.

The bank also would be obligated for the rent on the store spaces Good Enterprises has leased, insurance, utilities and other expenses.

The procedure specified Friday eventually should result in good news for Good Enterprises' other creditors.

That assumes the firm has accurately estimated its assets' value.

Good Enterprises estimated last month that its assets were worth $12.6 million, far above its $10.3 million in debts.

It also assumes Shubert has success turning a paper asset into cash, by collecting $2.6 million in accounts receivable.

Among the other creditors are its former employees, who are owed a collective $121,000 in wages, commissions and accrued vacation.

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