The New Year starts on a positive note for brothers Jeff and Lee Faclis as their Resolution Digital Studios and Show Department companies emerge from the Chapter 11 bankruptcy filed more than a year ago.
A reorganization plan, effective Jan. 1, was approved by the U.S. Bankruptcy Court of Northern Illinois.
Under the new plan, the three companies (including Facklis-owned Screenworks) will operate as divisions under Ops 3 LLC, a newly formed holding company. Jeff and Lee Faclis and RDS general manager Fred Booras will be Ops 3 LLC employees, according to the official confirmation of RDS’ reorganization that was sent to creditors.
Ops 3 LLC is owned by FBP Holding LLC, a private equity firm specializing in owning and managing service industry assets.
When Resolution Digital Studios filed for Chapter 11 Sept. 11, 2010, its main creditor, American Chartered Bank, claimed debts of $2.1 million. As of June 30, 2011, the bank debt was reduced to $1.95 million.
Throughout the bankruptcy process, claims RDS attorney Ellen Parker, “American Chartered Bank employed aggressive strategies in an attempt to force the companies into liquidation, including sending select, negative documents to clients, vendors and employees.”
Under the proposed plan, which has to be confirmed, creditors will be paid “equitably and fairly,” to the best of Ops 3 LLC’s ability, possibly over an 18 month period.
In coming out of the bankruptcy period, “I am thankful for the employees who stuck with us through this very emotional time. We saved 75 jobs and that is really a good thing,” said Jeff Facklis in a press release,
Show Department convention clients are major industries
Founded in 1983 by the brothers, the Show Department, Chicago’s biggest event companies is a nationally recognized leader in the meeting and event industry.
It develops and stages live corporate meetings, trade shows, live broadcast and virtual meetings for companies in major industries, such as pharmaceutical, automotive, medical, insurance and technology.
As a privately owned company, Show Department’s gross sales are unpublished, but in previous years its annual gross sales were publicly estimated at $10-$13 million.
Resolution Digital Studios opened in April, 2005, as a 100% HD, full-service company whose services augmented those provided by Show Department. The vertical stage complex in a building adjacent to Show Department was built at a cost of $7.5 million for construction and equipment.
The resurgence of the convention and meetings business after a three year slump, combined with Show Department’s new sales and marketing initiatives has resulted in a better year than expected for the company. That helped solidify the case for the confirmation of the reorganization plans, Faclis added.
He also praised legal counsel Andrew Maxwell of Maxwell Law Group, LLC, for guiding the company through the bankruptcy process.