A U.S. bankruptcy judge in Wilmington, Delaware has agreed to let Prospect Park sell $5.3 million in Connecticut tax credits to Apple, Inc., reports Law360.
As previously reported, Prospect Park is liquidating their assets following their failure to successfully re-launch long-running ABC Daytime soap operas All My Children and One Life to Live online.
The bulk of funds generated by transferring the tax credits to Apple will go to Prospect Park's creditor, EP Financial Solutions. The lender reportedly extended a tax credit loan to the production company in June 2013. The U.S. Bankruptcy Court issued an order approving the sale earlier this week. Here's an excerpt:
“This sale order and the consummation of the sale of the tax credits are supported by good business reasons and will serve the best interests of the debtors, its estates and creditors by maximizing the value obtained.”
Connecticut offers a 30 percent credit to companies with certain production costs more than $1 million. In court documents, Prospect Park claimed they had roughly $20 million in qualified expenses during 2013.
According to the Law360 article, Prospect Park borrowed $5 million from EP Financial Solutions in June of 2013. Fifteen months later the production company filed for Chapter 11 protection. Under the Bankruptcy Code, Prospect Park is required to "maximize value for certain transaction".
In their bankruptcy filing, Prospect Park listed between $10 million and $50 million in debts. The production company is suing Disney-ABC, alleging the media giant conspired to sabotage the launch of One Life to Live online by killing off borrowed characters on ABC Daytime's General Hospital.
Prospect Park further alleges Disney-ABC wouldn't give them access to show websites, promotion opportunities, etc. and that it was Disney-ABC's intent to create a "megasoap" from the ashes of All My Children and One Life to Live.
Prospect Park is seeking $95 million in damages. Disney-ABC vigorously denies Prospect Park's claims, and is suing the firm for unpaid licensing fees and damages.