Restaurant reservation – Cucina Papoff http://cucinapapoff.com/ Tue, 28 Jun 2022 17:02:55 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://cucinapapoff.com/wp-content/uploads/2021/10/icon-120x120.jpg Restaurant reservation – Cucina Papoff http://cucinapapoff.com/ 32 32 ERGO Analyzing Developments Impacting Business: Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2022. https://cucinapapoff.com/ergo-analyzing-developments-impacting-business-insolvency-and-bankruptcy-board-of-india-insolvency-resolution-process-for-corporate-persons-second-amendment-regulations-2022/ Tue, 28 Jun 2022 15:51:49 +0000 https://cucinapapoff.com/ergo-analyzing-developments-impacting-business-insolvency-and-bankruptcy-board-of-india-insolvency-resolution-process-for-corporate-persons-second-amendment-regulations-2022/ Introduction Indian Insolvency and Bankruptcy Board (table) see its circular no. IBBI/2022-23/GN/REG084 of June 14, 2022, in the exercise of the powers conferred by subparagraph Amendments The main changes introduced by the Amending Regulations are as follows: It is now mandatory that an operational creditor (who must register for GST) accompany their Article 9 application, […]]]>

Introduction

Indian Insolvency and Bankruptcy Board (table) see its circular no. IBBI/2022-23/GN/REG084 of June 14, 2022, in the exercise of the powers conferred by subparagraph

Amendments

The main changes introduced by the Amending Regulations are as follows:

  • It is now mandatory that an operational creditor (who must register for GST) accompany their Article 9 application, provide copies of the relevant excerpts from Forms GSTR-1 and GSTR-3B and copy of electronic transport invoices.
  • The regulations now require the personnel of the debtor company, its promoters or any other person associated with the management of the debtor company to provide the information requested by the IRP/RP in the format and within the time limits that the IRP/RP may require. A similar requirement has also been imposed on the creditors of a debtor company who are now required to provide the IRP/RP with information concerning the assets and liabilities of the debtor company from the last valuation report, the inventory status, receivables status, property inspection reports, audit report, inventory audit report, title search report, technical agents report, bank account statement and any other information that will assist the IRP/RP in preparing the information memorandum, determining the valuation, and generally carrying out the insolvency resolution process
  • In a significant change, the regulations now require that if the two estimates of a value in an asset class are significantly different, or upon receipt of a proposal for the appointment of a third appraiser registered by the creditors’ committee, the resolution professional may appoint a third chartered appraiser for an asset class for submission of an estimate of fair value and liquidation value calculated by two chartered appraisers. For the purposes of these Regulations, the class of assets shall have the definition given to it under the Companies (Registered Appraisers and Valuation) Rules 2017 and materially different has been defined as meaning a difference of twenty-five per cent of the liquidation value under an asset class.
  • The creditors of the debtor company are now mandated to provide the resolution professional with a relevant extract of the audits of the debtor company, carried out by the creditors such as inventory audit, transaction audit, judicial audit , etc. They are also required to provide the latest resolution professional financial statements and other relevant debtor company financial information available with them.
  • By way of a significant amendment, the mandatory content of a resolution plan has been updated to include-

“provides for the manner in which proceedings concerning cancellation transactions, if any, under Chapter III or fraudulent or illicit transactions under Chapter VI of Part II of the Code, will be prosecuted after the approval of the plan of resolution and the manner in which the proceeds, if any, of these proceedings will be distributed:

Provided that this clause shall not apply to any resolution plan which has been submitted to the contracting authority pursuant to subsection (6) of section 30 on or before the date of the opening of the Indian Council of the ‘Insolvency and Bankruptcy (Insolvency Resolution Process for Business Persons) (Second Amendment) Regulations 2022.’

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  • The Amending Regulations require operational creditors to provide excerpts of Form GSTR1, Form GSTR-3B and electronic freight bills, as applicable, with the application filed under Article 9 of the Code. The requirement to submit these documents at the time of filing the CIRP opening can improve the efficiency of the admissions process and prevent the contracting authority from wasting time requesting the required documents.
  • The Amending Regulation strengthened the existing provisions, including Article 19 of the Code, by stipulating an obligation for the debtor company, its promoters or any other person associated with the management of the debtor company to provide the information in the form, manner and within the time limits prescribed by the resolution professional.
  • The Amending Regulation modified the contours of the valuation (equitable and liquidation) of the debtor company. This has been done by replacing the existing provision, which provided that if the resolution professional is of the opinion that the two valuations submitted are materially different, they may appoint another registered valuator with a new, more objective provision which provides a definition of different and also requires that a third appraiser can be appointed if the creditors’ committee makes a proposal for the same or if there is a material difference in the values ​​of an asset class. This gives more discretion to the CoC which ultimately has to exercise its commercial wisdom.
  • The Amending Regulation attempted to ensure a free and rapid flow of information to the IRP/RP by requiring all creditors of the debtor company to provide information about the debtor company to the IRP/RP, including information about the assets and liabilities of the debtor company. , financial statements, valuation reports, bank statements, (judicial audit, inventory audit, etc.). This change could speed up the whole process by providing the IRP/RP with a sustainable data platform to rely on for purposes such as preparing briefing notes or identifying avoidable transactions. .
  • The Amending Regulation also addressed a vexatious issue by providing that a resolution plan should include (as mandatory content) provisions relating to how the procedure relating to avoidance transactions under Chapter III or Chapter VI of Part II of the Code should be prosecuted and how proceeds related to the proceedings should be distributed. In particular, this amendment has been made applicable only with prospective effect and will not apply to the resolution plan submitted to the contracting authority, before the entry into force of the Amending Regulation (date of publication in the official journal).

Conclusion

The amending regulation provides for essential changes and seems to have been prepared after taking into account the difficulties encountered by stakeholders in a CIR process. Arrangements for the flow of information to the IRP/RP can help improve the speed and efficiency of the CIR process. It is worth noting that the amendment relating to a resolution plan containing a provision to deal with avoidable transactions and the proceeds thereof will not apply to plans which have been submitted to the adjudicating authority, however, if the plans have been approved by a creditors’ committee but not submitted to the contracting authority, they may need to be modified to meet this requirement. This should be considered in light of previous amendments which prescribed that a plan could only be amended once.

The contents of this document do not necessarily reflect the views/positions of Khaitan & Co but remain solely those of the authors. For any other questions or follow-up, please contact Khaitan & Co at [email protected].

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3 key financial facts from the Corsicana Mattress bankruptcy filing https://cucinapapoff.com/3-key-financial-facts-from-the-corsicana-mattress-bankruptcy-filing/ Sun, 26 Jun 2022 15:32:54 +0000 https://cucinapapoff.com/3-key-financial-facts-from-the-corsicana-mattress-bankruptcy-filing/ The Corsicana factory in Richmond, Virginia. DALLAS – Mattress manufacturer Mattress Corsicana Co. and 11 related companies have filed for bankruptcy protection under Chapter 11 of the US Bankruptcy Code, and the filing offers insight into the company’s struggles. According to the filing, the company is working on a proposed asset purchase agreement with a […]]]>

The Corsicana factory in Richmond, Virginia.

DALLAS – Mattress manufacturer Mattress Corsicana Co. and 11 related companies have filed for bankruptcy protection under Chapter 11 of the US Bankruptcy Code, and the filing offers insight into the company’s struggles.

According to the filing, the company is working on a proposed asset purchase agreement with a subsidiary of Blue Torch Funding as an approaching horse bidder. The company has proposed in court documents that Blue Torch acquire the assets of Corsicana through a court-supervised auction.

The plan is subject to court approval.

In addition to the proposed sale, Blue Torch has agreed to provide debtor in possession financing to the company.

In connection with the proposed sale transaction, Corsicana has received a debtor-in-possession financing commitment from Blue Torch. Once approved by the court, the new funding, along with cash generated from ongoing operations, should allow the mattress business to continue operating as usual. In the filing, Corsicana seeks approval to pay its 865 full-time and part-time employees and 58 contract employees, as well as benefit programs, during the restructuring.

“The Chapter 11 process allows Corsicana to accelerate its refocusing on its core customers, renegotiate agreements, flatten our organization and increase efficiency in all aspects of our operations,” said Eric Rhea, CEO of Corsicana. “Our primary commitment is to serve our valued customers transparently, maintain partnerships with key vendors, and operate with integrity. As a result, we will provide high-quality sleep products coast-to-coast to Americans ordinary, handcrafted in the USA at the best possible price, ensuring Corsicana’s business will be strong for another 50 years.

Here are three key financial facts from the court case:

  1. As of May 30 — before the June 25 court filing — the company’s unaudited balance sheets showed total assets of about $151 million and total liabilities of about $260 million.
  2. The company estimates that its unsecured creditors owe about $45 million. The filing lists Corsicana’s top 20 unsecured creditors who owe approximately $20.56 million.
  3. Corsicana currently has more than $145 million in funded debt which, coupled with declining volume and unsatisfactory business performance, is unsustainable, according to the filing.

To guide the restructuring of the business, the company appointed Michael Juniper as Chief Restructuring Officer. Juniper is a partner of CR3 Partners, a Dallas-based turnaround Advice.

In addition to Corsicana, the 11 affiliated companies included in the file are: Thetford Leasing; Olive Branch Building; Eastern Sleep Products Co.; Mississippi Englander-Symbol Mattress; Hylton Home Furniture; Luuf; Florida Mattress symbol; Pennsylvania Mattress Symbol; Wisconsin symbol mattress; Transport mattress symbol; and Master Craft sleep products.

Prior to the filing, Corsicana had cut costs and sought to reduce the number of its factories. More recently, the company announced plans to close a former Symbol Mattress factory in Richmond, Virginia. Earlier this year, Corsicana announced that it would close its new boxed bed manufacturing plant in Indiana after it opened two months prior.

See also:

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Who says Johnny Depp can’t get $10.35 million from Amber Heard if she goes bankrupt? Here’s how he could earn “income” from her for decades! https://cucinapapoff.com/who-says-johnny-depp-cant-get-10-35-million-from-amber-heard-if-she-goes-bankrupt-heres-how-he-could-earn-income-from-her-for-decades/ Sat, 25 Jun 2022 07:02:42 +0000 https://cucinapapoff.com/who-says-johnny-depp-cant-get-10-35-million-from-amber-heard-if-she-goes-bankrupt-heres-how-he-could-earn-income-from-her-for-decades/ How Amber Heard can pay damages to Johnny Depp (Photo credit: Instagram, still from the film) Amber Heard and Johnny Depp’s legal drama continues as Aquaman 2 actress gets written order to pay $10.35 million as the damage has passed. As she will receive $2 million of Depp on his counterclaims. When this was announced, […]]]>
How Amber Heard can pay damages to Johnny Depp (Photo credit: Instagram, still from the film)

Amber Heard and Johnny Depp’s legal drama continues as Aquaman 2 actress gets written order to pay $10.35 million as the damage has passed. As she will receive $2 million of Depp on his counterclaims. When this was announced, Heard was in the spotlight that she couldn’t afford to pay the sum as her entire net worth was below that.

The actress was even trolled after she was spotted traveling on a private jet and later shopping at a discount store. Meanwhile, Depp is focusing on his career. It was recently announced that the Pirates of the Caribbean actor is going on a European tour with the band Hollywood Vampires.

Getting back to the point, Amber Heard, who has now received a written order to pay Johnny Depp $10.35 million after losing the defamation, will find it difficult to cover it. A lawyer, Raiford Dalton Palmer, told HollywoodLife how the payment can be made even if Heard doesn’t have enough money.

Palmer said Johnny Depp can collect his future income from movies and other projects. In addition to this, its assets can also be collected. “Johnny has a judgment saying she owes him,” the attorney said. “He can recover his assets and income for decades. But smart people with money know how to protect their assets,” he added.

“She could try to use bankruptcy to slow down payment, but that’s not a panacea,” Raiford Dalton Palmer said. On top of that, Amber has hinted that she intends to appeal the verdict in the case. If she does, she will have to pay more.

According to some reports, Judge Azacarate has said that Amber Heard will have to pay $480,000 (6% interest) if she were to file an appeal against Johnny Depp.

Must Read: ‘Captain America’ Chris Evans Ditches His Old iPhone 6s and Upgrades, Delighted Fans Shout ‘HALLELUJAH’!

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Bankruptcies have fallen, but economic pressures could send more small businesses looking for cover https://cucinapapoff.com/bankruptcies-have-fallen-but-economic-pressures-could-send-more-small-businesses-looking-for-cover/ Tue, 21 Jun 2022 17:08:39 +0000 https://cucinapapoff.com/bankruptcies-have-fallen-but-economic-pressures-could-send-more-small-businesses-looking-for-cover/ It may come as a surprise that, despite the pandemic, bankruptcy filings have dropped significantly over the past year: in March, annual bankruptcy filings stood at 395,373, compared to 473,349 cases in 2021, according to recently published statistics by the US Courts Administrative Office. It’s a 16.5% lessen. Government assistance programs and a historic rise […]]]>

It may come as a surprise that, despite the pandemic, bankruptcy filings have dropped significantly over the past year: in March, annual bankruptcy filings stood at 395,373, compared to 473,349 cases in 2021, according to recently published statistics by the US Courts Administrative Office. It’s a 16.5% lessen.

Government assistance programs and a historic rise in household wealth fueled by a strong stock market and higher house prices are among the reasons for this trend. But unfortunately, many experts believe that this trend will reverse and bankruptcies will soon increase.

Why? Because higher inflation, supply chain issues, slowing global production and rising interest rates are contributing to growing concern that the US economy could enter a recession this year. If that happens, small businesses, some of which are still reeling from the pandemic, could see lower demand and pressure on earnings that could force them to make tough decisions about whether or not to declare bankruptcy.

Brad Sadek, a bankruptcy lawyer based in Philadelphia, says that many small businesses tend to file for bankruptcy, not in the event of financial difficulties, but as a result of financial difficulties.

“If a business has been unable to get its Paycheck Protection Program loans forgiven, or if it is struggling to repay other debts due to a downturn, bankruptcies will increase,” he said. “Many business owners may also see their assets at risk, particularly if the real estate market continues to slow and property values ​​decline. The number of bankruptcies will increase.

It all sounds grim. But there is good news. Indeed, in 2019, a bill called the Small Business Reorganization Act was passed to help small businesses take advantage of Chapter 11 bankruptcy rules without incurring the high costs and regulations required by applicable law.

The legislation – called subchapter 5 by those in the know – streamlines the process of reorganizing small businesses. For example, it allows a business owner in financial difficulty to propose a plan of reorganization to an appointed trustee without having to obtain the approval or solicit the votes of his unsecured creditors, which is the case under the chapter 11. The law also establishes the 90-day deadline for filing a plan of reorganization, which helps business owners get back on their feet faster, instead of letting the process drag on without firm deadlines.

There are other advantages.

Rather than requiring a business owner to provide more capital in order to retain their stake — a condition that creditors often impose — the legislation only requires that the plan of reorganization be “fair and equitable” and ensure that the business owner’s projected payments or the value of assets to be distributed under the plan is not less than the owner’s projected disposable income. In many cases, the personal residence of the business owner can also be protected. An extended period is also allowed to pay administrative expenses, and a business owner can potentially be released from bankruptcy faster than under Chapter 11.

While the Small Business Reorganization Act established these simplified bankruptcy procedures to help small business owners keep their business afloat and preserve jobs, it was limited only to businesses that had debts of up to $2.7 million. The 2020 CARES Act temporarily allowed more small businesses to receive these benefits by increasing the small business debt limit from $2.7 million to $7.5 million. Unfortunately, this increase expired on March 27.

New bipartisan legislation, called the Bankruptcy Threshold Adjustment and Technical Corrections Act, aims to address this problem. The bill, which was signed into law by President Joe Biden on Tuesday after Congress passed it earlier this month, provides for a two-year extension of the CARES Act increase to 7.5 million dollars and makes minor technical fixes to the Small Business Reorganization Act. It also increases the debt limit for individuals to qualify for Chapter 13 personal bankruptcy for two years, allowing more people to try to save their homes from foreclosure.

Sen. Chuck Grassley (R., Iowa) was a key sponsor of the bill and estimates it could help up to 40% more businesses facing bankruptcy survive with its simplified rules.

“Maybe a local restaurant won’t be passed down from generation to generation,” he told me recently. “But there are a lot of small manufacturing businesses that do, and so this legislation will also help businesses continue for successive generations of a family.”

Hopefully your small business will never have to face bankruptcy. But if you find yourself in this situation and you qualify, then extending the rules of subchapter 5 can be crucial for your survival. If you think this is a possibility, it is important to speak to a bankruptcy expert as soon as possible.

“The new legislation is a very good thing for companies facing financial difficulties,” says Sadek. “And I think that’s going to be used by more small businesses here over time.”

Gene Marks is a Chartered Accountant and owner of Marks Group, a technology and financial management consultancy firm in Bala Cynwyd.

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Houston-area restaurant with self-service bar concept closes and files for bankruptcy https://cucinapapoff.com/houston-area-restaurant-with-self-service-bar-concept-closes-and-files-for-bankruptcy/ Mon, 20 Jun 2022 00:55:43 +0000 https://cucinapapoff.com/houston-area-restaurant-with-self-service-bar-concept-closes-and-files-for-bankruptcy/ SPRING BRANCH, Texas – Less than a year after launching its new self-service bar concept, a Spring Branch restaurant is closing its doors for good. The shutdown is just one example of how small businesses are struggling in a tough economy. PREVIOUS: Houston owner launches self-service bar and offers investors free pizza for life After […]]]>

Less than a year after launching its new self-service bar concept, a Spring Branch restaurant is closing its doors for good.

The shutdown is just one example of how small businesses are struggling in a tough economy.

PREVIOUS: Houston owner launches self-service bar and offers investors free pizza for life

After an 11 month run, shoot the moon is filing for Chapter 7 bankruptcy. The restaurant, which opened last July, allowed customers to pour their own beer, wine, liquor and cocktail directly from a tap wall.

“Today is our last day of service. We will remain open regular hours until 10 p.m. and then we will officially file for bankruptcy,” said Kevin Floyd, the owner.

Floyd helped bring popular Houston staples like Anvil, Underbelly and Julep to fruition. His curriculum vitae and his experience were the recipe for success. But in 2022, these factors were simply not enough.

“The fundamental gross foot traffic that we needed to make the business cash flow positive just never materialized there,” Floyd said.

RELATED: Inflation in May hits highest level in 41 years, says Labor Department report

“I have never seen such a drastic increase in the cost of food across the board happen so quickly and sustainably,” Floyd said. “They’re not going down. I don’t think we’ll ever see cost of goods sold again from 2019.”

While Floyd attributes the business’s closure primarily to its location, he acknowledges that supply chain issues and record inflation may also have contributed to its post-pandemic downfall.

Last week, inflation hit a 40-year high of 8.6%.

“If any of those factors were slightly different, we’d probably be in a different place, but they all happened at the same time and there’s just no way we can adapt to all of that.” , said Floyd. .

AFTER: Biden tells oil refiners: produce more gas and diesel, less profit

As growing fears of a possible recession loom, President Biden has said tackling inflation is his number one priority.

Gas prices are currently averaging just under $5 a gallon across the country.

Consumer spending is also showing signs of slowing, according to a Bloomberg report.

As for Floyd, he is now focused on picking up parts and interviewing for a new job.

“I will most likely end up in personal bankruptcy, overall. I’m the type of business owner that won’t leave anything on the line, so I put everything I could into this,” Floyd said. .

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Revlon Files for Chapter 11 Bankruptcy Protection https://cucinapapoff.com/revlon-files-for-chapter-11-bankruptcy-protection/ Thu, 16 Jun 2022 10:42:55 +0000 https://cucinapapoff.com/revlon-files-for-chapter-11-bankruptcy-protection/ Daniel Acker | Bloomberg | Getty Images Cosmetics giant Revlon filed for Chapter 11 bankruptcy on Wednesday night as it struggled with heavy debt and a congested supply chain. The company said it expects to receive $575 million in debtor-in-possession financing from its existing lender base, which will help support its day-to-day operations. The filing […]]]>

Daniel Acker | Bloomberg | Getty Images

Cosmetics giant Revlon filed for Chapter 11 bankruptcy on Wednesday night as it struggled with heavy debt and a congested supply chain.

The company said it expects to receive $575 million in debtor-in-possession financing from its existing lender base, which will help support its day-to-day operations.

The filing “will allow Revlon to bring our consumers the iconic products we’ve offered for decades, while providing a clearer path for our future growth,” Revlon President and CEO Debra Perelman said in a statement. press release issued Thursday morning.

“Our challenging capital structure has limited our ability to manage macro issues to meet this demand,” Perelman added.

Revlon’s bankruptcy filing says the company is currently unable to meet nearly a third of customer demand for its products in a timely manner, due to an inability to source “sufficient and regular in raw materials”. Shipping components from China to the United States takes Revlon eight to 12 weeks and costs four times 2019 prices, he said.

Revlon is the first major consumer-facing company to file for bankruptcy protection in what has been a years-long hiatus from distress in the retail sector. More than three dozen retailers filed for bankruptcy in 2020, marking an 11-year high in what experts said was a significant, pandemic-driven surge in restructuring activity.

Through May 31, S&P Global Market Intelligence has tracked 143 bankruptcies, across all industries, so far this year, the slowest pace since at least 2010. S&P has tracked just three bankruptcy filings. retail over the same period, the lowest number in at least 12 years, he said.

Now, however, as inflation rages, interest rates rise and consumers begin to cut spending on discretionary items, experts predict that more retail businesses will be forced to restructure. Especially since many of these companies are struggling with ongoing supply chain challenges that have left them with the wrong inventories.

The nail polish and lipstick maker, which is controlled by billionaire Ron Perelman’s MacAndrews & Forbes, has listed assets and liabilities between $1 billion and $10 billion, according to a filing in the US bankruptcy court. Southern District of New York.

Revlon had long-term debt of $3.31 billion as of March 31, according to a securities filing. The company’s market capitalization was nearly $123 million at the close of trading on Wednesday. Trading in Revlon shares was halted during Thursday’s premarket session.

In late 2020, as stuck-at-home consumers drastically cut spending on beauty items, Revlon narrowly avoided bankruptcy when enough bondholders participated in its debt restructuring program. The company had warned in early November of that year that it might be forced to seek Chapter 11 protection.

Its sales of about $1.9 billion in 2020 were down 21% from 2019 levels. Although business rebounded in 2021, Revlon’s revenue is still below pre-pandemic levels.

Start-ups such as Glossier, Kylie Jenner’s Kylie Cosmetics and Rihanna’s Fenty Beauty have also challenged Revlon as it vies for money from young consumers.

Perelman’s MacAndrews & Forbes acquired Revlon in a hostile takeover for about $1.8 billion in 1985. It went public 11 years later.

The business has grown over the years through acquisitions, including the Cutex business of Coty and Elizabeth Arden. In addition to her eponymous makeup banner, her portfolio also includes Almay, American Crew and Britney Spears Fragrances.

PJT Partners is acting as financial advisor to Revlon, and Alvarez & Marsal is acting as restructuring advisor.

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Fourth Circuit ruling clarifies application of exceptions to discharge in Subchapter V | Bradley Arant Boult Cummings LLP https://cucinapapoff.com/fourth-circuit-ruling-clarifies-application-of-exceptions-to-discharge-in-subchapter-v-bradley-arant-boult-cummings-llp/ Tue, 14 Jun 2022 20:25:52 +0000 https://cucinapapoff.com/fourth-circuit-ruling-clarifies-application-of-exceptions-to-discharge-in-subchapter-v-bradley-arant-boult-cummings-llp/ As previously discussed posts and items (here, here and here), in 2019, Congress passed the Small Business Reorganization Act creating the new Subchapter V of Chapter 11 of the Bankruptcy Code. The purpose of Subchapter V was to make small business bankruptcies faster and less costly. However, the substantial benefits of Subchapter V may come […]]]>

As previously discussed posts and items (here, here and here), in 2019, Congress passed the Small Business Reorganization Act creating the new Subchapter V of Chapter 11 of the Bankruptcy Code. The purpose of Subchapter V was to make small business bankruptcies faster and less costly. However, the substantial benefits of Subchapter V may come at a cost for small businesses.

The recent decision of the Fourth Circuit In re Cleary Packaging, LLC2022 WL 2032296 (4e Cir. June 7, 2022) clarified that in certain cases of sub-chapter V, the statutory exceptions to the bankruptcy discharge will apply to debtor companies. This is a significant change in the law of business reorganization under Chapter 11 of the Bankruptcy Code. Small business lenders may consider pursuing non-discharge claims in bankruptcy cases filed under Subchapter V.

In re Cleary Packaging, LLC

The dispute over the discharge exception that reached the Fourth Circuit began with a state court judgment. Cantwell-Cleary Co., Inc. won a judgment of more than $4 million against Cleary Packaging, LLC, a company formed by the former president and CEO of Cantwell-Cleary. The state lawsuit alleged willful interference with contracts, tortious interference with commercial relationships and related claims. In response to the judgment, Cleary Packaging filed a petition under Chapter 11 of the Bankruptcy Code, electing to proceed under Subchapter V. In its bankruptcy plan, Cleary Packaging proposed to only pay Cantwell- Cleary only 2.98% of his judgment, with the rest of the debt to be discharged. Cantwell-Cleary filed adversarial proceedings seeking to determine that the state court judgment was a debt for “willful and malicious injury” that was not dischargeable under sections 1192 and 523(a)(6) of the Code. bankruptcies. If Cantwell-Cleary prevailed, it meant that Cleary Packaging would not be relieved of the bankruptcy judgment. The bankruptcy court dismissed Cantwell-Cleary’s suit, finding that the exceptions to release under § 523(a) do not apply to corporate debtors. On direct appeal, the Fourth Circuit decided the sole issue of whether Cleary Packaging, as a Subchapter V corporate debtor, can discharge its over $4 million debt to Cantwell-Cleary “for willful and malicious harm”.

The discharge of debts under subchapter V is governed by § 1192(2). This section provides: “If the debtor’s plan is confirmed…the court shall grant the debtor a discharge from all debts…except any debt…of the type specified in Section 523(a) of this title.” In turn, Section 523(a) provides that releases in the specified release provisions of the bankruptcy code, including Section 1192 which applies to Subchapter V, do not release a individual debtor among the 21 types of debt listed in the law. The bankruptcy court interpreted this provision as limiting the exceptions to the discharge only to individual Subchapter V Debtors. On appeal, the Fourth Circuit found that in Subchapter V cases where the debtor fails to confirm a consensual plan, the relief exceptions of § 523(a) apply to individual debtors and corporate.

The Fourth Circuit first turned to the text of § 1192(2), which provides a “debtor” relief. According to the definitions of the Bankruptcy Code, this term includes both individuals and companies, and it is logical that there is no distinction in the discharge that is applied to these debtors. This is also consistent with Subchapter V’s exclusion of the application of the exception to the discharge of a company provided for in § 1141(d) upon liquidation, thus eliminating the distinction between a discharge for an individual and an entity in a liquidation. The court also focused on the wording of section 1192(2), which states that it excludes from release “any debt … of the kind specified in Section 523(a). The Fourth Circuit concluded that the use of the word “debt” was decisive, as it does not lend itself to encompassing the “type” of debtors discussed in § 523(a). Further, the court held that the combination of the terms “debt” and “of the genre” indicated Congress’s intent to refer only to the list of non-dischargeable debts found in § 523(a).

The Fourth Circuit also felt that its interpretation serves fairness and justice. A Subchapter V debtor can confirm a non-consensual plan – that is, a “cram-down” plan – in which business owners can retain their interest without paying the business’s creditors in full. This is a dramatic departure from traditional Chapter 11 cases which are governed by what is known as the “overriding priority rule.” Since an eligible small business debtor receives greater relief in Sub-Chapter V, it should not receive debt relief for fraud, willful and malicious injury, and other violations of public order reflected in the list of exceptions in Section 523(a). at the landfill.

Practical application

Generally, in a traditional Chapter 11, the exceptions to discharge for debtor companies are more limited if the company is not in liquidation. Based on the decision of the Fourth Circuit in In re Cleary Packaging, LLC, Subchapter V includes broader exceptions to the discharge for a debtor who cannot confirm a consensual plan, including claims against corporate debtors for certain types of fraud and other intentional and malicious injuries.

Practitioners and small business lenders should be aware of the applicable exceptions to discharge in Subchapter V and determine whether they should file an adversarial proceeding to declare such debts non-dischargeable. And, if you are seeking such relief, it is essential to keep in mind that the Bankruptcy Code and Bankruptcy Rules provide strict time limits for filing these adversarial proceedings.

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Electric vehicle manufacturer Electric Last Mile Solutions files for bankruptcy https://cucinapapoff.com/electric-vehicle-manufacturer-electric-last-mile-solutions-files-for-bankruptcy/ Mon, 13 Jun 2022 02:30:00 +0000 https://cucinapapoff.com/electric-vehicle-manufacturer-electric-last-mile-solutions-files-for-bankruptcy/ U.S. commercial electric vehicle maker Electric Last Mile Solutions (ELMS) showcases its all-electric city utility van and commercial truck in Troy, Michigan, U.S., November 19, 2021. REUTERS/Rebecca Cook Join now for FREE unlimited access to Reuters.com Register June 12 (Reuters) – U.S. commercial electric vehicle maker Electric Last Mile Solutions Inc (ELMS) (ELMS.O) said on […]]]>

U.S. commercial electric vehicle maker Electric Last Mile Solutions (ELMS) showcases its all-electric city utility van and commercial truck in Troy, Michigan, U.S., November 19, 2021. REUTERS/Rebecca Cook

Join now for FREE unlimited access to Reuters.com

June 12 (Reuters) – U.S. commercial electric vehicle maker Electric Last Mile Solutions Inc (ELMS) (ELMS.O) said on Sunday it planned to file for Chapter 7 bankruptcy, following a review of its products and marketing plans.

The move comes after the Troy, Michigan-based company disclosed a U.S. Securities and Exchange Commission investigation and withdrew all of its previously published March business outlook. Read more

ELMS had said the SEC was investigating issues discussed in previous filings, including disagreements with an accounting firm and compliance with Nasdaq listing rules.

Join now for FREE unlimited access to Reuters.com

In February, then-Chairman and CEO Jim Taylor and Chairman and Founder Jason Luo resigned, following an investigation into their stock purchases. Read more

“The compound effect of these events, along with an ongoing SEC investigation launched this year, has made it extremely difficult to find a new auditor and secure additional funding,” ELMS said in a statement Sunday. .

The electric vehicle maker previously laid off around 24% of its staff as it focused on its core business. Read more

The company went public in June 2021 through a merger with blank check company Forum Merger III Corp.

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Reporting by Baranjot Kaur in Bengaluru; Editing by Shailesh Kuber

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Student loan borrowers need a better bankruptcy process: Durbin https://cucinapapoff.com/student-loan-borrowers-need-a-better-bankruptcy-process-durbin/ Sat, 11 Jun 2022 11:43:48 +0000 https://cucinapapoff.com/student-loan-borrowers-need-a-better-bankruptcy-process-durbin/ Biden administration officials have appeared willing to reform the student loan bankruptcy process. But the Department of Education continued to oppose debt cancellation claims in court. Senator Dick Durbin said it’s time to rethink bankruptcy law that prevents borrowers from getting relief. Loading Something is loading. Daniel and Monica Woolley have a student debt of […]]]>
  • Biden administration officials have appeared willing to reform the student loan bankruptcy process.
  • But the Department of Education continued to oppose debt cancellation claims in court.
  • Senator Dick Durbin said it’s time to rethink bankruptcy law that prevents borrowers from getting relief.

Daniel and Monica Woolley have a student debt of $111,000 which they say they cannot repay.

Although employed by the U.S. Postal Service as a mail carrier, Daniel has exhausted his paid time off to undergo knee surgery, and he is still unable to return to work due to complications from the operation, according to a document filed by the Woolleys in March. Monica, his wife, is a salesperson who earns around $2,400 a month and has donated plasma to help pay the bills.

The Woolleys say the cost of daily necessities and health insurance for Daniel’s surgeries has placed significant financial pressure on them. They have filed for debt discharge through bankruptcy because they don’t see their income increasing anytime soon.

“Because of his age and ill health, the plaintiffs believe it is reasonably likely that his income will not recover because he will be physically unable to meet the demands of his job as a letter carrier for the U.S. Postal Service,” says the folder. . “Mr. Woolley would show that he has no reasonable prospect of advancement in his profession or increase in income. Plaintiffs would show that their economic prospects will remain the same or deteriorate.”

Just over a month after the Woolleys filed their lawsuit, President Joe Biden’s Education Department filed a response opposing the request for discharge. While this is a common response in this type of legal case, it sets in motion a process that makes it harder for student loan borrowers than people with other types of debt to get relief. by bankruptcy.

Senate Majority Whip Dick Durbin thinks it’s time to reassess this process.

“I also think we need to rethink the provisions of our federal bankruptcy laws that make student loan debt one of the few debts that cannot be canceled in bankruptcy proceedings,” said Durbin in the Senate this week, adding that “bankruptcy should be allowed to be used as a last resort for borrowers who have no other place to turn.”

Biden administration officials have indicated a desire to reform the student loan bankruptcy process. But it’s unclear what those reforms would be, or when they would be implemented, meaning borrowers continue to fight the government in court.

“Borrowers facing extreme hardship pay the price”

Much of the reason it’s so difficult to get rid of student debt in court comes down to the “undue hardship” standard, where borrowers must show they can’t maintain a minimum standard of living. , that their situation is unlikely to improve, and that they have made a good faith effort to repay their debt.

But to prove that the difficulties are not easy; very few borrowers seeking relief through bankruptcy were able to provide sufficient evidence to qualify. And as a senator in 2005, Biden expanded that standard to apply to borrowers with private loans.

Biden’s education department acknowledged problems with the process. On Monday, James Kvaal, undersecretary for education, said: “We want to review this policy, and that’s something that’s ongoing. There’s an interagency process for that, it’s not just to departmental discretion, and we’re working pretty hard on that, actually.”

In the past year, however, the department has appealed discharge approvals, including of a borrower who said his expensive cancer treatment prevented him from earning enough money to pay off his debt.

Dan Zibel, vice president and chief counsel of Student Defence, an organization that defends the rights of borrowers, said in a recent statement that “although the Department of Education has publicly acknowledged the problems, to date we We’ve seen little concrete change in policy, and borrowers facing extreme hardship are paying the price.”

Durbin and some of his colleagues have offered legislative solutions. Last year, Durbin and GOP Sen. John Cornyn introduced a bill that would allow borrowers to seek release from their federal student loans after 10 years and remove the undue hardship requirement.

And in late March, 27 Democratic senators said student loan borrowers had to jump an “unnecessarily high bar” to get rid of debt in court, making it “virtually impossible for those unrepresented.”

Do you have a story to share about your student loan bankruptcy? Contact Ayelet Sheffey at asheffey@insider.com.

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Evacuated Horizon West Condo Owners Continue to Face Financial Uncertainty | Waukesha County News https://cucinapapoff.com/evacuated-horizon-west-condo-owners-continue-to-face-financial-uncertainty-waukesha-county-news/ Thu, 09 Jun 2022 12:14:00 +0000 https://cucinapapoff.com/evacuated-horizon-west-condo-owners-continue-to-face-financial-uncertainty-waukesha-county-news/ WAUKESHA – Despite the September deadline to demolish the dilapidated Horizon West condo building, condo owners still face financial uncertainty and hurdles. “My daughter and I have been traumatized and my budget is currently collapsing,” Carlos Bergin said in a statement. He lived in Horizon West for six years and still owes over $50,000 on […]]]>

WAUKESHA – Despite the September deadline to demolish the dilapidated Horizon West condo building, condo owners still face financial uncertainty and hurdles.

“My daughter and I have been traumatized and my budget is currently collapsing,” Carlos Bergin said in a statement. He lived in Horizon West for six years and still owes over $50,000 on his Horizon West mortgage. “I was stuck in motels that I couldn’t afford for about three or four months until I found an apartment. I wouldn’t wish that on anyone!”

Horizon West residents were evacuated from their homes on 15 minutes’ notice on December 2 due to an imminent risk of collapse.


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The city issued a shaving order in January for the Horizon West building, which residents appealed. Residents continue to pay their old mortgages, finance new living arrangements and may have to pay the bill for the demolition of the building.

According to condo owner Laurel Peterson, the razing order “requires owners to provide over $1 million in funds to complete the demolition, which includes special asbestos abatement due to the materials used during the construction of Horizon West in 1966. If the association can’t come up with those funds and remove the building within 120 days, then the city will make its own arrangements to demolish it at the city’s expense and bill the owners under the form of a tax lien,” she said in a statement. .

“I have no idea where I would find the money to pay for the demolition of the building, let alone find the money to pay a down payment on another house.” Mary O’Herron said in a statement. “Based on the sale price of the same floor plan with similar upgrades to mine, I believe I lost about $130,000 in equity. That’s money I would have used if I chose to move to be closer to my adult children and their families, or if I needed to move to an assisted living facility.

All owners of Horizon West were required to carry homeowners insurance for their unit, and the condo association also had an insurance policy through Travelers Insurance for common areas and the structure of the building as a whole, said Peterson.

“That’s exactly why people buy insurance, but unfortunately there’s no specific ‘imminent collapse’ insurance that we could have bought,” Peterson said in a statement. Peterson, his wife and daughter lived in Horizon West for two years and owe over $100,000 on their mortgage. “If Travelers turns us down and we don’t get any help, that sends a message to condo owners everywhere that you run the risk of losing everything at any time and your insurance is worthless,” Peterson said.

Continuing lawsuit

In April, 27 of the condo owners filed a $17 million lawsuit against Travelers Insurance for failure to pay claims.

Travelers Insurance will not comment on pending litigation.

Horizon West has insured the building for a new cost of over $17 million.

The suit added that the building is a total loss.

“In its latest cover letter, Travelers goes so far as to say that since the issue of the razing order, there is no cover but if the building collapses, Travelers could cover,” said the suit.

Many owners have had to restart their retirement plans or return to work after retiring.

“My wife and children had finally convinced me to retire at 78,” RJ Esposito said in a statement. Esposito lived with his wife, Pat, in Horizon West for four years. He retired a few hours earlier on the day of the evacuation. “It completely upended our retirement plans. I’m working again, but at 78 I don’t have the energy I had 5 or 10 years ago, so I don’t know how long I can go on,” he said. Some residents had to declare bankruptcy.

“This has undermined my credit and bankruptcy is imminent,” Todd Dreger said in a statement. Dreger lived in Horizon West for four years and had $30,000 in equity as well as a $100,000 mortgage. “It has disrupted our financial planning, and my significant other has major health issues. I will not be able to retire as I had planned.

Condo owner Robert Berry worries about financial uncertainty.

“Imagine having to buy two houses in one year. We are devastated and traumatized,” Berry said in a statement. “Paying two mortgages while only being able to live in one place is unaffordable for anyone. This will force us to file for bankruptcy and ruin our perfect credit.

A GoFundMe account has been created for Horizon West Condominium owners to help offset the financial burden they are facing. It can be found at https://www.gofundme.com/f/help-48-evacuated-families.

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