XCOR update: Bankruptcy court now recognizes the MDC as a secured creditor

In 2012, the MDC paid XCOR $10 million to relocate its headquarters to Midland from Mojave, California. The original contract did not have the MDC as a collateralized secured creditor.

In 2012, the MDC paid XCOR $10 million to relocate its headquarters to Midland from Mojave, California. The original contract did not have the MDC as a collateralized secured creditor. Photo: Tim Fischer\Reporter-Telegram Photo: Tim Fischer\Reporter-Telegram Image 1 of / 1 Caption Close XCOR update: Bankruptcy court now recognizes the MDC as a secured creditor 1 / 1 Back to Gallery

The MDC voted at its meeting Tuesday to amend its agreement with bankrupt aerospace company XCOR to pursue becoming a secured creditor.

In 2012, the MDC paid XCOR $10 million to relocate its headquarters to Midland from Mojave, California. The original contract did not have the MDC as a collateralized secured creditor.

Tuesday’s action was a retroactive approval, as Chairman Brent Hilliard had filed uniform commercial code (UCC) financing statements with the Texas, California and Florida secretaries of state on Nov. 8, the day XCOR filed for bankruptcy in California.

The bankruptcy court now recognizes the MDC as a secured creditor, according to court documents. XCOR’s debt to the economic development group is the full $10 million.

In the same document, it is stated that XCOR has $1,106,624.21 in assets — all of it personal property — and $27,460,550.15 in total liabilities. Of its liabilities, $13,860,756.59 is for creditors who have secured claims. Space Florida is another major creditor with a secured claim.

Space Florida, a state-backed economic development group, enticed XCOR with a $5.7 million deal, according to a 2012 Space News article. XCOR agreed to manufacture and fly the Lynx from Kennedy Space Center.

Space Florida says XCOR owes it more than $3.6 million, according to a court filing.

On Oct. 25, Space Florida submitted civil lawsuit filings in Midland County court. On Oct. 31, Judge George D. “Jody” Gilles granted a temporary restraining order against XCOR so that Space Florida could obtain electronically stored information from XCOR’s servers, hard drives and other devices. XCOR did not attend the hearing.

The remaining liabilities are split between priority unsecured claims ($13,364.55) and nonpriority unsecured claims ($13,586,429.01).

In original financial filings, XCOR reported having $1,424.66 in cash.

No value was given to the Lynx MK1, a spaceplane in development that would take off and land horizontally. Between $15 million and $20 million would be required to finish the Lynx, according to documents. An estimated $25 million to $30 million was invested.

Also on Tuesday, the board approved a resolution allowing agreements with law firms for legal matters tied to the XCOR bankruptcy. The original item was amended to specify XCOR; the board considered the wording of the original resolution too general, encompassing all legal matters. Hilliard abstained from voting.

The board also ratified a month-to-month contract with Cirro Energy to provide power for hangars A and B at Midland International Air & Space Port. XCOR previously was paying for electricity there.