In addition, any new bidders will be up against a lowered sale price for the company.
Bruce Bailey, counsel for Hardwick Clothes, told U.S. Bankruptcy Judge Shelley D. Rucker he had received the request at the last minute on May 16, the last day either bids or a request for an extended period could be made.
Bailey did not disclose the identity of the person or persons making the request.
The order for bidding procedures issued April 15 included, at the insistence of the Pension Benefit Guaranty Corporation — Hardwick’s largest debtor — a stipulation that should a potential bidder notify the Hardwick attorneys they desired “additional time to conduct due diligence,” and gave that notice by May 16, the deadline for bidding would be extended to May 30.
The extension opens up the time frame for any bidder and not just the potential bidder who requested the new deadline.
Another revelation during Wednesday’s hearing was that Jones CapitalCorp. and Hardwick had been in negotiations over the past few weeks concerning necessary improvements to the Hardwick plant.
Bailey noted the plant used diesel boilers until the 1990s and the environmental levels of any substances related to the use of diesel fuels had been “approved by TDEC (Tennessee Department of Environment and Conservation).”
“At that time, screening levels were more stringent than they are now,” Bailey said. “The current levels are not OK by today’s standards,” he added.
He told the court Jones has an environmental consultant still at work on the issue, but under the terms of the approved procedures Hardwick could fix the issues themselves and still sell at the original agreed-to price of $2 million or renegotiate that price.
Hardwick chose to renegotiate with Jones and the price was reduced to $1.9 million.
The new schedule of events will be the bidding deadline of May 30.
If one or more competing bids against the current bid by Jones CapitalCorp. are received, an auction would be held in Chattanooga at 9 a.m. on June 2.
Whether an auction is held or not, a final court determination on the sale of Hardwick Clothes would come in U.S. Bankruptcy Court, at a hearing on June 6 at 9:30 a.m.