Daily Archives: May 24, 2021

.:Personal Bankruptcy:.

Bankruptcy is a court action to eliminate (discharge) your debts. The terms Chapter 7 and Chapter 13 Bankruptcy come from the sections of the federal bankruptcy law that contain these provisions. Spiraling credit card debt, the sudden loss of a job, medical bills, a divorce can wipe out a lifes savings. For many, bankruptcy provides a second financial chance.

In Chapter 7 you eliminate your debts completely. A Chapter 7 case usually lasts about 3 to 4 months. Chapter 7eliminates credit card debts, medical bills, judgments, taxes, loans and other debts. In Chapter 13 you repay some or all of your debts over a 3 to 5 year period. Chapter 13 stopsforeclosures, repossessions and evictions.

All cases in Vermont are filed at the U.S. Bankruptcy Court in Rutland. Bankruptcy hearings are held either in Rutland or Burlington. In order to file in Vermont you must have been a Vermont resident for at least three out of the last six months. In order to file Chapter 7 you must not have filed and received a discharge in a prior Chapter 7 case within the last 8 years. There are no limitations on how often you can file Chapter 13, but you cannot obtain a Chapter 13 Discharge if you obtained a discharge ina Chapter 7 case within the past 4 years, or in a Chapter 13 case within the past 2 years.

For many reasons, businesses may face serious cash flow issues at one point or another. Pressures from vendors and creditors can make it worse. Many businesses, especially those 10 years and younger, started with personal guarantees on certain debts. As a result, the financial concerns of struggling business owners can extend beyond their own business. Indeed, it is not uncommon for personal assets and finances to be at risk. For businesses in financial distress, bankruptcy may be an option. Some business seek bankruptcy protection while they reorganize -- giving themselves a little breathing room. Others seek it to wind down operations.

Click Here to read "Why bankrupt a corporation?.

No matter what the situation, business bankruptcies can be complex, especially if they involve issues of wages, benefits, deposits on services or merchandise, or tax contributions and payments.

Excerpt from:

Home - Vermont Bankruptcy Law Office

DEARBORN, Mich., May 24, 2021 /PRNewswire/ --Henry Ford Village ("HFV," "the community") today announced that the United States Bankruptcy Court in the Eastern District of Michigan has approved the sale of substantially all of HFV's assets to HFV OPCO, LLC, an affiliate of Sage Healthcare Partners ("Sage"), for $76.3 million, subject to entry of final agreed orders. The transaction remains subject to regulatory approvals and customary closing conditions, and HFV anticipates the sale will be completed in approximately 90 to 120 days.

The path forward for the community centers around its inclusion in Sage's network of senior living communities, and includes plans to increase programmatic activities for residents and employees while investing to improve HFV's campus more broadly. Sage has also pledged to uphold HFV's current commitments to maintain the health, safety and lifestyle of its residents.

"We're starting a new chapter in the Henry Ford Village story, and we're pleased to do so having achieved a stronger financial foundation and maintained the best interests for the full HFV community. Sage is already showing commitment and engagement with the people who make HFV so special, and we're confident that it will uphold HFV's values. Now, we look forward to emergence and seeing the long-term positive impact that Sage has on our community," said Bruce Blalock, Henry Ford Village's Executive Director.

"We are pleased to have executed a strong sale process that brought a proposed order to the Court, supported by all major constituencies. We are grateful to HFV's stakeholders for coming together to support the combination and path forward for the community," said Sheryl Toby, Partner at Dykema Gossett PLLC.

"We're excited to give HFV a chance to thrive for years to come and, more importantly, to begin focusing on what truly matters: the health and safety of every HFV community member," said Avi Satt, President of Sage Healthcare Partners. "Our priority is forming deep and meaningful relationships with staff and residents, and collaborating to carry on the legacy of a long-standing and wonderful senior living community."

Additional Information

All relevant sale-related court filings, as well as additional information about Henry Ford Village's Chapter 11 case are available at http://www.kccllc.net/HFV or by calling (866) 476-0898 for U.S./Canadian calls or (781) 575-2114 for international calls.

Henry Ford Village is represented in this matter by Sheryl Toby of Dykema Gossett PLLC. FTI Consulting is serving as Chief Restructuring Officer (CRO) and restructuring advisor.

About Henry Ford Village

Henry Ford Village is a Senior Living Community in Dearborn, MI, that encourages making the most out of every life opportunity. Henry Ford Village offers three levels of care for those 62 and older including independent living options, rehabilitation services, and assisted living. Henry Ford Village sits on 35 acres of land, which is home to over one hundred clubs and activities, and top-of-the-line residential care facilities for its residents to engage in and rely on. For more information, visit http://www.henryfordvillage.com.

About Sage Healthcare Partners

Sage is a premier operator of senior housing and healthcare facilities. It was founded on the principles of providing high-quality resident-focused care, with genuine diligence and dedication, and to create a work environment of equal caliber. Sage owns, operates, manages and consults across the full continuum of care in the senior housing and healthcare space, specializing in independent living, as well as continuing care retirement communities, assisted living, skilled nursing and memory care.

Media Contact:Rachel ChesleyFTI Consulting[emailprotected]

SOURCE Henry Ford Village

http://www.henryfordvillage.com

Excerpt from:

US Bankruptcy Court Approves Sale of Henry Ford Village to Sage Healthcare Partners Affiliate - PRNewswire

(Reuters) - Here is a look at some upcoming events of interest to the bankruptcy law community. Unless otherwise noted, all times are local, and court appearances are virtual due to the COVID-19 pandemic.

(Blank Headline Received)

Monday, May 24

10 a.m. The Boy Scouts of America will resume a hearing that began on May 19 on the youth organizations request to solicit creditor votes for its proposed reorganization plan. The plan includes a proposed settlement to resolve 80,000 sexual abuse claims, but claimants and insurers remain opposed to the deal. The case is In re Boy Scouts of America, U.S. Bankruptcy Court, District of Delaware, No. 20-10343. For the Boy Scouts: Jessica Lauria of White & Case.

Tuesday, May 25

1:30 p.m. Security systems provider Secure Home Holdings LLC will seek approval of its prepackaged reorganization plan, through which senior lenders will take control of the company. The case is In re Secure Home Holdings LLC, U.S. Bankruptcy Court, District of Delaware, No. 21-10745. For Secure Home: Van Durrer of Skadden Arps Slate Meagher & Flom.

Wednesday, May 26

10 a.m. Following several postponements to allow for ongoing negotiations with creditors, Purdue Pharma will seek approval to begin soliciting creditor votes for its proposed reorganization plan, which aims to resolve nearly 3,000 lawsuits accusing the company of fueling the national opioid crisis. The OxyContin maker has received some opposition to its solicitation materials from various states, cities, counties and tribes, as well as a group representing babies born with addiction-related health issues. The case is In re Purdue Pharma LP, U.S. Bankruptcy Court, Southern District of New York, No. 19-bk-23649. For Purdue: Marshall Huebner of Davis Polk & Wardwell.

1 p.m. Mallinckrodt Plc will seek approval to solicit creditor votes for its proposed reorganization plan, which would cut its debt stack by $1.3 billion and set up a $1.6 billion trust to pay out people and entities that have filed opioid-related claims against the company. Mallinckrodt has received several objections to its disclosures associated with the plan, which are necessary to begin vote solicitation. The case is In re Mallinckrodt Plc, U.S. Bankruptcy Court, District of Delaware, No. 20-12522. For Mallinckrodt: George Davis of Latham & Watkins.

Thursday, May 27

10 a.m. Chilean car distributor and importer Automotores Gildemeister SpA will seek approval of its prepackaged reorganization plan, which would reduce $200 million from its $567 million debt stack. The case is In re Automotores Gildemeister SpA, U.S. Bankruptcy Court, Southern District of New York, No. 21-10685. For Gildemeister: Jane VanLare of Cleary Gottlieb Steen & Hamilton.

Friday, May 28

10 a.m. The U.S.-based units of Singapores Eagle Hospitality Real Estate Investment Trust will hold a hearing on the sale of their assets. An affiliate of Monarch Alternative Capital LP is leading bidding with a $470 million offer. The case is In re EHT US1 Inc, U.S. Bankruptcy Court, District of Delaware, No.21-10036. For the debtors: Luc Despins of Paul Hastings. For Monarch: Gabriel Morgan of Weil Gotshal & Manges.

Know of an event that could be included in Week Ahead in Bankruptcy? Contact Maria Chutchian at maria.chutchian@thomsonreuters.com

See the article here:

Week Ahead in Bankruptcy: May 24, 2021 - Reuters

Presently no moratorium or mandate that prevents a commercial landlord from evicting a tenant in default exists. Federal and local governments have encouraged landlords to work with their tenants during the evolving impact of the COVID-19 pandemic. In contrast, residential tenants have been afforded a moratorium until at least June 30, 2021, in most instances. That said, some courts have recently issued rulings deeming the Center for Disease Controls orders related to the eviction moratorium as unconstitutional. Unless further extended or altered, it is likely in the next 60 to 90 days there will be a significant uptick in evictions, foreclosures, and possible bankruptcies. With that in mind, below are the Top Five Tips for Commercial Landlords in response to a tenant filing bankruptcy.

First, if possible, plan ahead. A third-party guarantor is one way a landlord may obtain better creditor protection when entering into a lease. The Bankruptcy Code does not prevent a landlord from taking action against a guarantor to a corporate tenant-debtors lease, provided the lease guarantor is not in bankruptcy. As highlighted below, once a tenant files for bankruptcy, it alters the landscape of enforcing the landlords rights. Thus, it is important that the landlord stay informed regarding the status of the bankruptcy.

Second, the automatic stay is just that, automatic. A tenant-debtor that files bankruptcy does not need to take further action to affirm the automatic stay applies. The automatic stay protects a debtor during the pendency of a bankruptcy proceeding unless terminated by the bankruptcy court. Landlords should not take any action to violate the automatic stay, such as filing a lawsuit against the debtor, continuing, a pending lawsuit against the debtor, or making demands to collect unpaid rent. Failure to abide by the protections of the automatic stay may subject a landlord to sanctions and punitive damages.

Third, if the debtor remains in the leased space, the debtor must fulfill all of its obligations as stated in the lease, including making timely post-bankruptcy payments. If the debtor does not remit timely post-bankruptcy payments, the landlord will need to pursue a motion for an administrative claim for the value of post-bankruptcy payments. An administrative claim has a higher priority ahead of other creditors in line for distribution from the tenant-debtor.

Fourth, assumption, assignment, or rejection of the lease. The tenant-debtor has the choice to either assume the lease for itself, assume and assign the lease to a third party, or reject the lease. These actions trigger important deadlines of which any landlord should be acutely aware. Each of the tenant-debtors options mentioned has varying implications.

Fifth, file a proof of claim with the bankruptcy court. It is common in the months leading to a bankruptcy filing that the tenant-debtor will fall behind in its rental payments. Shortly after the bankruptcy is filed, a debtor is required to file its schedules of assets and liabilities with the bankruptcy court, which lists all debts owed by the debtor before the filing of the bankruptcy. If the amounts owed to the landlord are not listed, or the amount listed is incorrect, then a proof of claim must be timely filed by the landlord.

In conclusion, the landlords rights and the tenant-debtors options mentioned each have varying legal implications. Therefore, it is highly recommended that landlords retain counsel for advice and guidance when a tenant-debtor files for bankruptcy.

Read more:

Will the Return to Normalcy Increase Tenants Seeking Bankruptcy Relief? - JD Supra

WHAT YOU NEED TO KNOW IN A MINUTE OR LESS

Companies should anticipate the possibility that they will find themselves in a situation where a vendor, customer, or other contract counterparty commences a bankruptcy case pursuant to Title 11 of the U.S. Code (the Bankruptcy Code). The ongoing COVID-19 pandemic has caused economic stress to a wide variety of business sectors, and it has underscored the risk that a contract counterparty may file for bankruptcy.

Vendor and customer contracts are subject to disruption or involuntary modification in bankruptcy. Contracts with ongoing duties of performance are treated as executory contracts under the Bankruptcy Code. A bankrupt debtor may elect to assume or reject executory vendor and customer contracts under 11 U.S.C. 365. Executory contracts (with some limitations) may be assumed and assigned to a third party, notwithstanding contractual anti-assignment provisions. If a debtor elects to assume a contract, it must cure defaults and provide adequate assurance of ability to perform. If the debtor elects to reject the contract, the debtor is relieved from future obligations of performance and the nondebtor party is entitled to file a damages claim in the bankruptcy case. Vendor and supply contracts are commonly transferred in bankruptcy sale transactions on terms that fix or eliminate rights to claim arrearages or redress for other defaults. It is important to timely identify the effect of the bankruptcy filing on executory contracts like vendor and supply agreements in order to ensure that contract rights are not eliminated or modified to the detriment of a nondebtor party.

Clients are accustomed to offsetting or netting obligations with vendors and customers. These rights of offset will be impacted by a bankruptcy filing. The Bankruptcy Code generally preserves rights of setoff. However, rights of setoff will be limited to the netting of only prepetition mutual obligations or only postpetition mutual obligations, and the effectuation of setoffs for prepetition obligations will be stayed. Setoff rights must be carefully preserved. If payments are made, the rights of setoff associated with those payments will be lost. Clients should carefully assess their rights of setoff and recoupment in order to preserve and enforce these valuable rights in bankruptcy.

The commencement of a bankruptcy case creates an automatic stay pursuant to 11 U.S.C. 362. The automatic stay is an injunction that precludes any act to collect debts, obtain rights in property of the party in bankruptcy (the debtor), or continue litigation against the debtor. The automatic stay prevents parties from terminating a contract with a debtor or threatening to do so. Parties should not send an invoice to, or request payment from, a debtor for prepetition debts, and they should not effectuate a setoff of mutual prepetition debts owing by the parties. Parties who violate the bankruptcy automatic stay can be liable for actual damages, punitive damages, attorneys fees, and costs. Companies should closely monitor bankruptcy notices they receive in the mail to make sure that they observe the automatic stay.

In order to prevent a debtor from preferring one creditor over others as it approaches bankruptcy, the Bankruptcy Code allows a bankruptcy trustee or debtor to sue creditors to claw back or avoid transfers they received in the 90-day period before the bankruptcy was filed (preferential transfers). This means a party that provided goods or services to the debtor may need to return payments that it received during the preference period in exchange for a claim in the bankruptcy proceeding. There are several defenses to a preference action, the most common being that the payment was made in the ordinary course of business affairs between the debtor and creditor or according to terms common in the industry. In order to preserve this defense, the creditor must carefully monitor payments from account debtors that it suspects might be experiencing financial troubles and ensure that payments are made pursuant to invoice terms or consistent with the time frame in which payments had previously been made. The ordinary course defense can be compromised by actions that are not ordinary, such as switching payment terms from check to wire, shortening payment terms, or applying unusual pressure to elicit payment. The Consolidated Appropriations Act of 2021 has temporarily amended the Bankruptcy Code to except, from avoidance as preferential transfers, certain payments to landlords and suppliers of goods or services. The exception applies to payments made pursuant to an agreement or arrangement entered into on or after 13 March 2020 to defer or postpone payments owed, and it is subject to certain other limitations.

The rest is here:

Litigation Minute: Bankruptcy Issues for Vendors and Other Contractual Counterparties - JD Supra