Metrolux parent company moves toward creation of reorganization plan

LOS ANGELES — Metropolitan Theatre Corp., which operates two movie theaters in Loveland, has been ordered to file its bankruptcy court reorganization plan by May 28 and a status report by June 4, and be available for a status conference June 11.

Metropolitan on Feb. 29 filed for Chapter 11 bankruptcy protection in the Central District of California, where its headquarters is located. The company operates 16 theaters including two IMAX theaters, one of which is in Loveland.

The company said in an April 4 status report that movement toward the reorganization plan is continuing apace with the key factor being negotiations with landlords, including the two Loveland landlords.

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“While the debtor believes the plan will be consensual, it is in the early stages of its discussions with landlords. … (T)he debtor believes that the relatively small size of the unsecured claims and the debtor’s intention to reinstate the secured claims will lead to a consensual plan,” the company’s attorneys wrote in the status report.

Further, “secured claims are expected to be reinstated and priority claims, if any, paid at confirmation. Unsecured claims will be paid from projected disposable income … in the three-year period, or such longer period not to exceed five years as the court may fix.”

Metropolitan Theatres is talking with Independent Bank, which holds the largest unsecured guaranty claim. It plans to reinstate its Small Business Administration loan. 

“The debtor’s exit from bankruptcy is tied largely to its negotiations with its landlords,” the attorneys wrote.

Independent Bank, which has loaned money to Metro Foundry LLC, the landlord of the downtown Loveland theater, has a $1.9 million contingent guaranty claim, and Metropolitan hopes to secure an agreement out of court to limit liability, its status report said.

David Corwin, president of Metropolitan, told BizWest previously that the pandemic, followed by the actors’ strike that limited new movies to show, harmed the industry overall. He said business is improving but has not returned to 2019 levels. 

Corwin did not respond to a request for an updated comment.

The bankruptcy action is Metropolitan Theatres Corp., case number 2024bk11569 filed Feb. 29, 2024, in the California Central District Bankruptcy Court.