Court approves Spartans' bankruptcy plan
A federal court has accepted the Nashua Spartans Drum & Bugle Corps’ bankruptcy plan to pay debts and reorganize for a possible return to the city next year.
The corps has not performed this year, as the organization owed more than $200,000 to creditors – an amount that did not include a lapsed $849,000 mortgage on the outfit’s longtime home at 73 E. Hollis St.
But as part of the Chapter 11 plan, which was accepted Aug. 13 in U.S. Bankruptcy Court in Manchester, money remaining from the recent $915,000 sale of Spartans Hall will help the corps get out of the red.
That figure was lessened greatly with the bankruptcy plan eliminating nearly $155,000 of debt.
The Spartans will now regroup, changing management and undergoing a fundraising campaign to prepare for a 2010 return, said the corps’ attorney, Eleanor Dahar. The Spartans will work out of a temporary home at 491 Amherst St. as it searches for a permanent home, Dahar said. The corps intends to stay in Nashua, she said.
“We’re now assembling teachers and staff, a new board. We have the support of the community and mayor’s office,” she said.
Former Spartans Director Peter LaFlamme had blamed the weak economy for the group’s downfall when news of the corps’ financial difficulties became known in January.
LaFlamme’s nephew, Paul LaFlamme, and two other directors at the time faulted Peter LaFlamme for mismanaging the group and providing inadequate information for the board to oversee the corps and its finances.
Paul LaFlamme will now serve as an unpaid interim executive director, with the volunteer help of two other area residents in managing the corps. A task force will also oversee the transition: helping recast a new board of directors and conducting inventory and liquidation of unneeded supplies and equipment.
The Spartans lost their East Hollis Street facility after falling behind on its mortgage. The group was to have made $5,300 monthly payments to Bank of New England.
The bank bought the building at auction last month with an $800,000 bid. But the Chapter 11 plan filed in court lists building sale proceeds at $915,000.
With cash already in the Spartans account and the sale of the hall, the corps paid off its remaining mortgage of $849,000 and $21,200 in interest to Bank of New England, according to court documents.
Remaining funds will pay $12,500 in administrative costs, $5,033 to the Internal Revenue Service, and $8,800 in wages. The Spartans had owed $182,015 in unsecured claims, but the bankruptcy plan cut that to three payments of $9,100 each.
The Spartans didn’t perform this year to allow for cost savings and restructuring, according to court documents. But the corps intends to sign up members for 2010 at a fee of $1,250 each.
Also considered as possible future revenue for the Spartans, according to the bankruptcy filing, is fundraising, about $30,000 generated from performances around the country, $20,000 from a home show and an alumni giving program.
The Spartans Drum & Bugle Corps was formed in 1955.