Category Archives: Bankruptcy

The judge in Vesttoos Chapter 11 bankruptcy case has called for all sides to stop litigating and start cooperating to find a common ground on key issues that have been holding back progress at a hearing yesterday. Meeting to discuss whether the joint provisional liquidators (JPLs) to the segregated cells of Aons White Rock SAC should be able to attend a Bermuda court hearing without fear of violating the stay that has been imposed, Judge Mary F Walrath concluded that they should, as long as they take no action that would violate it.

As we reported yesterday, the battle over control of and access to segregated cells used for Vesttoo linked reinsurance contracts affected by the fraudulent letters of credit (LOC) continues.

Yesterdays hearing was driven by the JPLs seeking clarity over their attendance of an upcoming Bermuda Supreme Court hearing regarding the liquidation of cells linked to Aon intellectual property reinsurance transactions.

What came out of it was an approval that they and White Rock should be able to attend, but in doing so they must not take any actions that would violate the current interim stay orders and automatic stay.

Judge Mary Walrath stated, Let me address the narrow issue that is before me. It is whether or not the JPLs else can attend Fridays hearing to answer any questions that the Bermuda court, which appointed them, may ask and I think the answer to that is clearly yes.

I do not see that as violating the automatic stay or the terms of the interim stay orders.

They are a fiduciary appointed by the Bermuda court under the Bermuda courts purview and if the circumstances were reversed, I would expect the fiduciary that I had appointed in a bankruptcy case to appear at a hearing I scheduled to address my questions about what is going on, in both that case, and any related Chapter 15 case.

I dont think another order is necessary, we already have four interim orders regarding the effect of the stay, we have the automatic stay and I understand that the JPLs and White Rock have stated that they do not intend to violate the automatic stay.

If they do, the debtor has remedies.

Clearer still, was the frustration of the judge in having to mediate between the parties over matters they had failed to agree on.

Leading her to say, I am not deciding any property interests in the Vesttoo segregated cells that are implicated by the debtors bankruptcy, but I do have the jurisdiction to decide that issue at the appropriate time.

I also have jurisdiction to decide the motion that the debtor has filed regarding whether or not White Rock has or the JPLs have already violated the stay and that is scheduled and will be heard.

But I agree with the committee and the debtor, that we ought to stop litigating and start cooperating.

She went on to discuss the importance of protecting the bankruptcy estate, which perhaps provides a glimpse into how the US court may deal with the subject of segregated cells, their ownership and whether they constitute part of the bankruptcy estate or not.

For the judge, it seems to all be about protecting value and maximising it for the benefit of creditors, which speaks to the very reason for bankruptcy courts in the first place.

Saying, There is limited property, as in any bankruptcy or wind up proceeding. It is in the interest of both parties, I believe, to maximise the value of that property and it ought to be done before the parties, as in any bankruptcy, often it is appropriate to preserve and or sell property of the estate before anybody fights over their share of that pie.

In addition, Judge Walrath called for the establishment of a protocol that would allow a level of coordination between the Chapter 11 bankruptcy court in Delaware and the Bermuda Supreme Court where the White Rock cell liquidation and restructuring case is set to be heard.

There also should be an appropriate protocol that will allow this court to communicate with the Bermuda court and vice versa to try and set up procedures that will assist the parties in working cooperatively to the end that both of them hope and that is maximising the value of the estate, Walrath said.

Judge Walrath went on to advise the parties that a mediator may be able to assist, in finding common ground between them, particularly related to the topics of the functioning of a protocol between the courts, of how far the automatic stay extends, whether the property of the White Rock cells is the property of the bankruptcy estate, and so whether Vesttoo as debtor should be allowed to control them.

These are topics where there remains a substantial amount of disagreement, particularly on the White Rock cells and their ownership.

Summarising, the judge explained, I think the JPLs as fiduciaries in the Bermuda case, are obligated to appear at the hearing to answer the courts questions. They have committed that they will not seek affirmative relief that would violate the automatic stay and Im satisfied with that representation today.

I understand the debtor would be permitted to attend the Bermuda hearing and can protect its interests there.

The call for cooperation is timely, as with the Bermuda hearing nearing there is every possibility that after that the disagreement over the way forward, in relation to the fraud affected cells, their ownership and whether they form part of the bankruptcy estate, may escalate.

Interestingly though, there was no mention in yesterdays hearing of the creditor committee statement that counsel had discovered that a large amount of cash may have been withdrawn from certain of the Vesttoo Segregated Accounts since mid-July 2023.

That seems an important piece of the puzzle and one were likely to learn more about as this saga continues.

Read all of our coverage of the alleged fraudulent or forged letter-of-credit (LOC) collateral linked to Vesttoo deals.

See the rest here:

Vesttoo case: Time to "stop litigating and start cooperating" says ... - Artemis.bm

In a significant development, digital asset lender BlockFi has seen its bankruptcy plan receive approval. Indeed, bankrupt judge Michael Kaplan has approved the crypto firms Chapter 11 bankruptcy plan, as noted in a court hearing that took place this week.

BlockFi still owed over 1,000 creditors a sum of nearly $10 billion. Moreover, the lender owes Three Arrows Capital $220 million, with its top creditor being owed $1 billion. Now, the approval creates a pathway for customers to be paid back.

Also Read: SEC to Delay $30 Million BlockFi Fine Until Investors are repaid

Digital asset lender BlockFi has seen its bankruptcy plan receive official court approval in a court hearing on Tuesday. Indeed, customers of the platform are now on a journey toward their repayment. Subsequently, the $10 billion owed is likely to begin being paid back in the near future.

US bankruptcy judge Michael Kaplan approved the plan as part of a hearing with the US Bankruptcy Court of New Jersey. Yet, unsecured creditors may still have to wait for their funds to be returned. Specifically, the reimbursement may rely on BlockFis positive results in its legal conflict with FTX.

Also Read: BlockFi Will Refund $297 Million to Users

BlockFi had submitted its liquidation plan in late November, with revisions following, according to Crypto Potato. Specifically, three different amended plans were filed between May and July, according to court records. However, the plan was ultimately approved by Kaplan this week

Alternatively, the court filing notes the contentious bankruptcy proceedings that had been taking place. Yet they also pointed out that the settlement that was reached curbed certain administrative costs. Therefore, maximizing customer recovery remained their priority.

Read more from the original source:

BlockFi Bankruptcy Plan Receives Approval - Watcher Guru

A recent incident involving a former CEO of a local US bank has been the latest reminder of the risks tied to the crypto world. As the industry grows despite tales of fortunes made and lost abound, this particular story paints a cautionary tale of corporate responsibility gone awry.

Heartland Tri-State Bank, a cornerstone in Kansas, primarily served the financial needs of local farmers and businesses. According to a recent report from Bloomberg, this institution, known for its deep-rooted community connections, suddenly became thrust into the spotlight of an investment scandal.

At the helm of this financial whirlwind was its then-CEO, Shan Hanes. Hanes redirected the banks assets to a crypto venture based in Hong Kong. His actions were not immediately apparent until a significant decision caught the attention of many.

Bloombergs investigative piece revealed the first signs of Hanes predicament. In what appeared to be an act of desperation, the CEO reached out to one of his wealthiest clients with a proposal to borrow $12 million.

Trying to justify his request, Hanes disclosed his involvement in the crypto world. The then-CEO spoke of an individual guiding him through crypto investments. But all was not going well.

Hanes shared that due to some unforeseen complications related to wire transfers, Hanes needed significant funds to salvage the situation. To sweeten the deal and perhaps win over the clients trust, Hanes offered $1 million in interest on the loan.

The repercussions of Shan Hanes investment decisions cast a long shadow over Heartland Tri-State Banks future. Notably, The Federal Deposit Insurance Corporation (FDIC) eventually intervened, setting aside over $54 million to safeguard the interests of the banks patrons, shielding them from the fallout of the banks financial insolvency.

Although specific details of Hanes transactions remain enigmatic, the report points fingers at a probable pig-butchering scam. Such schemes, as outlined by US regulatory bodies, cunningly entice victims into channeling more funds under the illusion of recovering their assets.

Bloomberg cited Law enforcement data indicating that billions have evaporated from the pockets of individuals trapped by these predatory tactics.

As the financial storm Hanes stirred intensified, Heartland Tri-State Banks viability stood shaky. Questions about the banks ability to remain solvent amid the financial chaos began circulating.

Amid the turbulence, a silver lining emerged for the banks clients. According to the report, Dream First, a fellow banking entity, entered the fray, acquiring the banks assets. This acquisition ensured that Heartlands customers did not lose any deposited funds.

However, while Heartland Tri-State bankers could sigh relief, the banks original shareholders bear the brunt, facing significant financial repercussions.

Featured image from Unsplash, Chart from TradingView

Read this article:

From Bank To Bankruptcy: How This Crypto Scam Toppled A US ... - Bitcoinist

Source: AdobeStock / Rafael Henrique

Prominent media outlets, including Bloomberg, Dow Jones & Company, The New York Times, and The Financial Times, have raised objections to a joint motion by the debtors and the Official Committee of Unsecured Creditors asking for further data redactions in FTX bankruptcy case.

The motion sought authorization to extend the redaction of confidential customer information for an additional 90 days, covering the names, addresses, and email addresses of all of the debtors' customers, including entities and institutional creditors who were also customers.

Media Intervenors expressed their opposition in a court filing, highlighting concerns over the continued redaction of customer data.

They argued that the motion lacked substantial new evidence to support an extension of the redaction deadline.

The media outlets emphasized that stating ongoing discussions with third parties as the reason for the extension was insufficient justification.

These objections are part of a larger legal battle between the media outlets and FTX Trading Ltd. concerning the redaction of customer names in court filings.

In December 2022, Media Intervenors successfully intervened in the bankruptcy case to oppose the redaction of the FTX creditors' names in court documents. Their intervention was granted by the court.

Despite objections from Media Intervenors, on June 15, 2023, the court partially granted a joint motion by the debtors and the Official Committee of Unsecured Creditors, allowing certain redactions of customer data for a specified period.

Media Intervenors promptly appealed this decision, and the appeal is currently pending in the United States District Court for the District of Delaware.

The ongoing legal dispute underscores the tension between privacy concerns and transparency in bankruptcy proceedings.

While the debtors and the Official Committee of Unsecured Creditors seek to protect customer data, Media Intervenors argue for greater disclosure and transparency in court filings.

The court will now consider Media Intervenors' objections in this complex case, and the outcome may have implications for the handling of customer data in bankruptcy cases, setting a potential precedent for future disputes in this area.

Continue reading here:

Mainstream Media Objects to Further Customer Data Redactions in ... - Cryptonews

The Center for Autism and Related Disorders (CARD) is now back under the leadership of its founder and former CEO.

Doreen Granpeesheh and her business partner Sangam Pant acquired CARD out of bankruptcy in a deal involving a consortium made up of PE firm Audax Group and its portfolio companies. The deal approved by a judge at the end of July and valued at about $48.5 million closed at the end of August.

Now that she owns the company, Granpeesheh will take over its daily management as CEO, reversing her career trajectory. When Granpeesheh sold the company to investment titan Blackstone in 2018, she planned to hand over the reins to another CEO, taking on a board role and slowing down, she explained on the latest episode of the Behavioral Health Business Perspectives podcast.

But then COVID hit. And she became a nearly constant advisor to the companys new leadership as it navigated the historic crisis. Ultimately, she stepped away from her board role as the company stumbled under the pressures triggered by the pandemic.

She would have done several things differently in navigating the challenges brought about by COVID. She also details how she plans to navigate the still-relevant pressures that put CARD into bankruptcy in the first place.

As a new company Pantogran LLC now owns CARD Granpeesheh shared her insights on where the company came from and where she will take it now that she is back at the helm.

Highlights from the conversation are below, edited for length and clarity. Subscribe to BHB Perspectives to be notified when new episodes are released.

Granpeesheh: I started treating children coming out of UCLA (University of California, Los Angeles). UCLAs clinic was very small and research-oriented. The patients who wanted ongoing therapy moved over to my new practice with me.

It was a very small operation. I did everything: hiring therapists, training them, billing patients for them, seeing the patients, record writing, everything. A few of the parents whose children had done very well started writing books about the interventions. Lots of parents started reaching out to me from different parts of the country, requesting that I come and open a clinic where they were. Parents asked me to start clinics there. I told them if they could get about 20 or 25 patients, it would be feasible for me to come out there and open a clinic. It started gradually, and then I started opening more clinics and building the companys infrastructure.

Id say they would be from 2015 to 2017. We had figured out the formula; lets put it that way. We had a very good system in place to scale up. Those were very key.

I never had any kind of outside funding. I managed the company pretty closely, I would say. We would raise funds through revenue and allocate them to further growth or research. We were always able to reinvest. What happened was that we had opened over 150 or so clinics during those last couple of years, from 2016 and 2017.

These clinics were great. They had the infrastructure, and they were doing well. But it was getting to the point where it was very difficult to manage. We were exhausted. We had been working very long hours and very hard for many years now. Sangam and I as well as our core leadership team which was predominantly clinicians felt that if we got to 300 clinics, we would be holding the company back because we dont have enough span. We cant expand more and keep it under control.

We all felt that bringing in an investor like Blackstone might help us expand. That was the whole reason for this. I had been approached by a variety of investors all the way back to the early 2000s. I was never interested because I saw the path and wanted to stay on the path.

Around 2017 or so, it had gotten to the point where the private equity industry had entered our field. So, other providers were growing through acquisition faster than we were. I felt that we needed help expanding beyond this number.

It took CARD a little longer to figure out exactly how to adjust because we had new leadership. (Tony Kilgore succeeded Granpeesheh in December 2019. He was replaced by Jennifer Webster in 2022.)

There were a few other things. People point to the debt. But we didnt bring on debt immediately [as part of the Blackstone investment]. It wasnt just the debt. The company was really healthy before COVID. But there was a slight imbalance of expenses and revenue. That tends to happen when you bring in large infrastructure all at once.

The difference was that over the years that we were building CARD, it was a very gradual process of adding expensive things, whether it was new leadership that needed to have higher compensation or a new electronic health record that cost us a lot whatever it was, it was all gradual.

Coupled that [sudden growth in expenses] with the reduced revenue resulting from the initial hit from COVID with a new management team all of that together is what caused CARD to struggle.

One of the things that I disagreed with or would do differently, personally, is centers were shut down because they were just struggling with cutting costs. The way that we would have operated in the past would have been to go in and try to figure out why theyre struggling, and see if we can help them and see if we can turn things around.

We started engaging on this after the bankruptcy auction in mid-July. We divided up the costs among the management team. Sangam took over all vendor agreements and started renegotiating and reducing costs on those. An organization the size of CARD had hundreds of vendor contracts. A lot of those contracts were honestly too big for the size of the company that it is now. In a short period of time, we negotiated a lot of those contracts, including payer contracts.

I started working on employment and getting employees back in. I had a couple of weeks to rehire as many employees that we want to keep as possible. As we were doing this, our goal was to bring in as many savings as we could. Sangam and I taking over allowed us to make the hierarchy more flat. A lot of the costs were associated with the top level of the company. We were able to make that a lot less.

Were starting out with a much more lean company. Thats the answer. We have to keep the company lean, go back to taking care of our patients and staff and also pay attention to the business. That essentially means going back to not outsourcing every single function. Keeping cost at the forefront and managing the books a little more carefully will be in mind when taking care of patients and staff.

Over the last few years, CARD started to restrict its patients to younger children because it aimed to focus on early intervention. Im not going to do that; weve changed that. Were going to have clinics for all patients of all ages.

View original post here:

CARD's Founding CEO Returns to the Helm: What's Next for the ... - Behavioral Health Business

On September 27, 2023, Your Team Marketing (YTM) analyzed Jungkook's Calvin Klein promotional campaign, which focused on a Personal Branding strategy to increase profits and sales for their brand, which was on the verge of bankruptcy.

YTM, who consider themselves marketing experts, pointed out how Calvin Klein demonstrated that personal branding can be more effective in driving sales and profits compared to mass marketing. They stated:

They further stated:

As YTM tweeted their analysis of the significance of using personal branding, which generated authenticity and developed a personal connection and trust with the targeted audience, fans were over the moon, feeling proud of Jungkook's worldwide influence.

As Jungkook's promotional campaign for Calvin Klein resulted in positive outcomes, including a gross profit of $1,250.3 million, according to YTM, and a turnover of $2,157.9 million for the first quarter, fans were proud of him and stated that he is a brand himself. Moreover, YTM also cited the following contributions that Jungkook, as the global ambassador for Calvin Klein, made:

As Jungkook contributed to preventing Calvin Klein from falling into bankruptcy (a legal process initiated against a business/organization or an individual unable to pay their outstanding loans, thus falling into a debt trap), fans are proudly stating that the brand should be grateful. They also noted that Calvin Klein has since increased the prices of its products.

Check out how fans are reacting to the increase in profits and sales of Calvin Klein because of Jungkook:

Meanwhile, Your Team Marketing also emphasized that by harnessing Jungkook's influence and thereby building trust, popularity, and authenticity worldwide, the American brand was able to emerge from its unfortunate state of bankruptcy and regain momentum in the market.

This led to products selling out within minutes, resulting in increased sales and greater exposure on their social media accounts.

As fans began discussing Your Team Marketing's analysis on social media, they attributed this success to how Jungkook promoted their products on Weverse Live, folding the Calvin Klein clothing pieces. Some even mentioned having a pile of clothes because of him.

In conclusion, Your Team Marketing highlighted the growing significance of Personal Branding in today's society, referring to the idol as the "sold-out king." They stated:

They added:

Meanwhile, some fans have stated that personal branding may only work with influential personalities like BTS and their members due to their reputation and substantial presence in the industry, unlike celebrities who often hide behind a facade.

The golden maknae is set to release his second digital single, 3D, on September 29, 2023.

Link:

"Calvin Klein was once on the verge of bankruptcy": BTS' Jungkook's ... - Sportskeeda

Chicagos Lerner family fight is rippling deeper into local real estate development deals.

Michael Nathan Lerner is seeking bankruptcy protection from a foreclosure on a Wicker Park apartment building he owns, the latest event in a series of legal disputes among members of his prominent Chicago real estate family.

In a Chapter 11 filing earlier this month, Lerner said that although the 25-unit property he owns at 1741 North Western Avenue is cash-flow positive, he had to seek bankruptcy protection due to the actions of his father, longtime multifamily developer Michael J. Lerner.

The elder Lerner is the founder of Chicago-based MCZ Development, which has a portfolio of apartment complexes in Chicago, Kansas City, Washington, D.C. and elsewhere.

The younger Lerner states in the filing that he and his father have worked in real estate for more than a decade and had agreed to evenly share the proceeds and costs of certain investments that the son owned, including the North Western Avenue building.

The filing alleges that Lerners father stopped paying his share of expenses for the properties, which has added up to more than $2 million, including $600,000 related to the North Western Avenue property.

Lerner states that the assets lender, Heartland Bank and Trust Company, refused to refinance a $5 million loan secured by the property despite having done so before, which he suspects is due to the creditors close business relationship with his father.

After the maturity default, the lender turned over the rights and interest in the mortgage to AEB Services, an entity controlled by a close friend and longtime business partner of the elder Lerner, according to the suit.

In the suit, Lerner added that the ongoing blitz of litigation from his father, a trust controlled by his parents and AEB have made it challenging to facilitate refinancing the property to satisfy his obligations to the lender.

An attorney representing Michael J. Lerner and AEB did not respond to a request for comment. Heartland did not respond to a request for comment. MCZ Development did not return a request for comment.

Over the summer, a lawsuit brought by a trust controlled by Lerners mother, Jamie Lerner, claimed that the son closed real estate deals without getting her permission when he was legally required to and that Jamie Lerner was entitled to receive half the proceeds from but never did.

Months earlier, Lerner privately settled separate litigation brought by his father that sought to usurp the sons equity in a $35 million Fulton Market development site sale to Miami-based developer Crescent Heights, which plans a 52-story, 587-unit apartment tower on the property at 420 North May Street.

A hearing in the sons bankruptcy case is scheduled for 9 a.m. Wednesday next week, court records show.

Read this article:

Lerner Family Fight: Father's Actions led to Bankruptcy, son Says - The Real Deal

Mercy Iowa City is shown Aug. 7 in Iowa City. The hospital has asked its separate nonprofit foundation for $4 million to fund operating expenses, prompting the foundation to ask the bankruptcy court to clarify its power and obligations. , (Jim Slosiarek/The Gazette)

IOWA CITY Mercy Iowa City this month asked its separate nonprofit foundation for $4 million to help fund day-to-day operating expenses through its bankruptcy proceedings, and the foundation said no even as creditors without access to foundation resources insist the hospital should tap the foundation funds first, before draining the cash it could use to repay them.

In a court filing, the Mercy Hospital Foundation on Wednesday sought to have a bankruptcy judge clarify its powers and obligations.

The foundation noted in the filing that a committee of unsecured creditors along with secured bondholders which Mercy owes more than $62 million have asserted the foundation has violated or will violate the foundations bylaws if the foundation does not fund (Mercys) operational needs, or if the foundation does not assist in paying (Mercys) creditors.

The bondholders said in court Sept. 13 they had evidence of (Mercys) sole and absolute control over the foundation, according to the foundations complaint. In contrast, the foundation vehemently asserts that there is no control by (Mercy) over the foundation, the foundations assets are totally separate and distinct from (Mercys) assets, and the foundations assets may not be commingled with or included in (Mercys) estate.

During hearings both last week and this week, attorneys representing Preston Hollow Community Capital Mercys largest bondholder said the hospital is burning through resources available to pay back creditors who have both secured and non-secured claims.

Arguing against a two-week delay to discuss whether Mercy should be allowed to keep using the cash for daily operations that it could use to pay back his clients, attorney Nathan Coco said costs associated with postponement are steep.

A continuation of the final hearing for two weeks is a million dollars a week, which is a pretty steep price from our perspective with respect to our cash collateral, Coco said, urging the hospital use foundation dollars instead.

Attorney Megan Preusker, also representing the bondholders during a discussion this week about Mercys request to keep paying hefty sums for interim management services, noted, This is a case where the burn rate for estate professionals is averaging approximately $483,000 per week.

We have a proposed sale of substantially all (Mercys) assets for $20 million, yet the outstanding secured debt is in excess of $62 million and then there are pension and other liabilities as the court is aware, Preusker said. These are factors to take into account in assessing the reasonableness of a proposed compensation arrangement.

A bankruptcy judge agreed to both delay the discussion about Mercys use of cash collateral and allow Mercy to keep using ToneyKorf Partners for interim management, given some amendments to its compensation deal.

But bondholders and unsecured creditors have maintained their insistence Mercys nonprofit foundation has resources the hospital could and should be using.

In summarizing the debate, attorney Dan Simon representing Mercy noted that while the foundation is a separate entity unencumbered by Mercy Iowa Citys debt, with a separate board and separate attorneys, Mercy Hospital is the foundations sole member and as such has certain rights.

And the committee (of unsecured creditors) and Preston Hollow allege that (Mercys) fiduciary duties demand that they effectively empty the coffers of the foundation, Simon said. And even if the board of the foundation denies their request to do so, the hospital board should replace that board all made up of volunteer board members and override the decision of the foundation and then empty the coffers.

In seeking a court declaration on its rights, powers, and remedies, the foundation asked whether and under what circumstances and for what purpose it must respond to funding requests from Mercy Iowa City and the entities and individuals to which it owes tens of millions.

And it argued its mission directs it to help Mercy solely for charitable purposes.

While (Mercy) may seek funding from the foundation, the foundation has sole discretion in approving or disapproving (Mercys) requests and, in any event, the foundation is only able to partially fund some of (Mercys) capital needs from time to time and only for charitable purposes, but not to fund (Mercys) operational needs, not to make distributions that may result in private inurement, and not to pay (Mercys) creditors, such as the bondholders, the foundation argued in its court filings.

The foundation therefore posits it may, pursuant to its current bylaws, properly and legally deny (Mercys) request to fund (Mercys) operational needs.

Even so, the foundation in its complaint noted, Mercy has more liabilities than assets and its creditors will not receive full payment in (Mercys) Chapter 11 proceeding.

The foundation which, as of March, reported assets totaling $17.7 million, including $9.7 million without restrictions did not guarantee or co-sign on any of Mercys debts.

The bondholders do not have any guarantor or co-debtor claim against the foundation, according to that entitys court filing.

In summarizing the complaint in an email to employees on Thursday, Mercy President and CEO Tom Clancy and Chief Restructuring Officer Mark Toney said the foundation is seeking only legal clarity on its rights and the rights of the other parties.

The bondholders and the unsecured creditors committee have asserted in the bankruptcy case that the foundation should either willingly give up, or Mercy Hospital should force the foundation to release a significant portion of its assets to fund the bankruptcy and pay creditors, the administrators wrote. The foundation believes it has its responsibilities, and we recognize and respect its decision to seek legal guidance.

Despite productive discussions that, on some points, have resulted in consensual compromise, Mercy attorney Simon last week said there has been backroom discord serving as another reason to delay discussion on using foundation dollars vs. Mercys cash collateral.

There's been significant acrimony behind the scenes, he said. We want to bring the temperatures down I think it's time to put down our swords for a short period to redouble the efforts on a settlement.

With the deadline to submit bids on the Mercy assets moved to Oct. 2, and a hearing on how Mercy funds its operations on an interim basis moved to Oct. 3, hospital executives on Thursday told employees that prospective bidders other than the University of Iowa have signed nondisclosure agreements, are performing their due diligence, and have scheduled tours.

We are bound by confidentiality agreements not to disclose the names of any interested parties at this time, Clancy and Toney wrote. However, after the bid deadline passes, we can share the additional parties with you.

The executives also noted that senior leadership next week will host Mercys annual Medical Staff and New Physician Reception and meeting.

We will update our medical staff on the current situation and encourage them to continue to support Mercy Iowa City during these times, they wrote. This will be an opportunity for our medical staff (new and old) to meet, renew and build referral relationships for our future.

Vanessa Miller covers higher education for The Gazette.

Comments: (319) 339-3158; vanessa.miller@thegazette.com

See the rest here:

Mercy Foundation asks court to clarify its role in bankruptcy - The Gazette

NEW YORK, May 17 (Reuters) - A lawyer for Celsius Network on Wednesday said the crypto lender hopes to conclude an auction for its assets within days and the current lead bidder is Fahrenheit LLC, a consortium that includes blockchain-based venture capital firm Arrington Capital, at a U.S. bankruptcy court hearing in Manhattan.

Celsius attorney Ross Kwasteniet told U.S. Bankruptcy Judge Martin Glenn the auction has taken longer than expected, but has been highly competitive. The current bids are "hundreds of millions of dollars" higher than the initial bid by NovaWulf LLC, a digital asset investment firm, he said.

New Jersey-based Celsius filed for Chapter 11 protection in July, one of several crypto lenders to go bankrupt following the rapid growth of the industry during the COVID pandemic. Celsius said at the time it had more than 1.7 million registered users and approximately 300,000 active users with account balances greater than $100.

Celsius kicked off an auction on April 22, seeking to find a buyer who can guide its crypto lending and bitcoin mining businesses out of bankruptcy. Celsius initially planned to accept NovaWulf's bid, but took more time to develop additional bids from Fahrenheit, and Blockchain Recovery Investment Committee (BRIC), a holding company affiliated with the Winklevoss-owned Gemini Trust.

Celsius plans to choose between the Fahrenheit and NovaWulf bids, since both offer a way to continue Celsius's lending business as well as its bitcoin mining business. Celsius has not set a deadline for final offers, but expects to conclude the auction within a week, Kwasteniet said.

BRIC's bid, which would preserve only the mining business, will serve as a backup bidder in case the Fahrenheit or NovaWulf bids fail to get regulatory approvals.

Kwasteniet said he does not expect Celsius to share the fate of Voyager Digital, a crypto lending company forced to liquidate after regulatory concerns scuttled Binance.US's plan to acquire it.

"We've kept the regulatory concerns front of mind and are confident that either party would be able to consummate a transaction," Kwasteniet said.

Reporting by Dietrich Knauth, Editing by Alexia Garamfalvi and Chris Reese

Our Standards: The Thomson Reuters Trust Principles.

Continued here:

Celsius bankruptcy auction nears end, with Fahrenheit in the lead - Reuters

Craig Barritt/Getty Images for VICE Media

Think back to a faraway time when Vice Media was a darling of the journalism landscape. It sported a hefty $6 billion valuation, had a high-profile documentary series on HBO, and web traffic soared largely thanks to a certain polarizing president who'd just taken office. The year was 2017.

Fast-forward to the present, when Vice saddled with liabilities of up to $1 billion has filed for bankruptcy.

It's far from alone. Six other large companies threw in the towel within a recent 48-hour span, the most active such period for bankruptcies since 2008, according to Bloomberg data looking at companies with at least $50 million in liabilities.

The reason is relatively straightforward: the Federal Reserve's interest-rate hikes designed to rein in inflation have laid bare the market's weak hands. A credit crunch is here, and it's spreading quickly, crippling companies with large, cumbersome debt loads. For those looking to refinance, the ship has sailed.

A look at the other recent bankruptcies from recent days (handily compiled by Bloomberg) shows a consistent theme: exorbitant liabilities, mostly in the form of debt.

It's worth noting that a bankruptcy filing is not necessarily a death knell for a company. Bankruptcies tend to wipe out stockholders, and give companies an opportunity to restructure their debt and come out the other side with a healthier balance sheet. Still, an uptick in bankruptcy filings clearly demonstrates increasing economic stress.

Data from Moody's suggests that the bankruptcy trend is just getting underway. The ratings giant expects defaults for companies with speculative-grade debt to rise to 4.9% by March 2024, up from 2.9% at the end of the first quarter of 2023, and exceeding the long-term average of 4.1%.

S&P Global's reading of the situation isn't much more promising. It sees the default rate for junk-rated companies getting to 4% by year-end, more than double the 1.7% figure from the end of 2023, though still off the peaks of the post-COVID era.

A separate look at private bankruptcy is arguably even more troubling. As of early April, UBS found that private filings were outpacing even the early stages of COVID, when many firms went under. A four-week moving average of 7.8 registered in late February handily exceeded a comparable figure of 4.5 reached in June 2020, the firm found.

The chart below highlights this comparison between present conditions and early COVID-era times, with the caveat that the same trend isn't being seen in public filings:

On a specific industry basis, the financial sector is under duress following the collapse of Silicon Valley Bank, with multiple other institutions following suit in recent weeks. Retailers from Bed Bath & Beyond to David's Bridal have filed for bankruptcy in recent weeks. Envision Healthcare a medical-staffing company backed by KKR was one of the six firms to declare alongside Vice.

What this assorted list shows is that no industry is safe from balance-sheet bogeys. If a company got too aggressive loading up on debt during the low-interest-rate era, chances are it will soon be feeling the pain.

Loading...

View post:

Surge in corporate bankruptcies just the start for debt-loaded firms - Business Insider