From the AP via the Asbury Park Press:
Kara chooses specialist in turnarounds
Under fire to change its management, Kara Homes Inc. has selected a veteran of corporate turnarounds to guide the company through its bankruptcy, according to court documents filed Monday.
If approved by a bankruptcy judge, Perry Mandarino, senior managing director of the New York-based financial consulting firm Traxi LLC., would be Kara’s chief restructuring officer and be in charge of daily operations, according to the filing.
“He’s a well-known commodity in the restructuring field,” said Michael D. Sirota, a Hackensack lawyer representing a committee of Kara’s unsecured creditors. “He understands the complexities of Chapter 11 and has the ability to bring instant credibility to the debtor.”
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The company is under pressure by creditors to bring in new management to either help or replace founder Zuhdi Karagjozi. It also needs to find short-term financing to finish about 300 homes it has sold. Kara had yet to line up financing as of Monday.U.S. Bankruptcy Judge Michael B. Kaplan is scheduled to decide next Monday whether to approve Mandarino’s selection or side with the U.S. Trustee’s Office, which last week filed a motion asking him to appoint a trustee to oversee the company’s operations.
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The Trustee’s Office said creditors haven’t been able to get timely or reliable financial information about Kara since the home builder filed for bankruptcy, and they have lost confidence in Karagjozi’s ability to manage the company.Kaplan’s decision would have a big impact on Karagjozi, 46, who started the company in 1999. If Kaplan chooses Mandarino, Karagjozi would stay at the company, albeit in a secondary role. If he chooses a trustee, Karagjozi would be replaced, said Allison Berger, a Lawrence lawyer who represents a masonry company owed close to $2 million.