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Neiman Marcus Group Inc. denied violating the terms of a loan from top-ranking lender Deutsche Bank AG, saying it has $100 million more cash on hand than projected because sales have been better than expected, WSJ Pro Bankruptcy reported. Deutsche Bank, in court papers filed Friday, said the bankrupt retailer breached the terms of a $760 million loan by overvaluing the inventory backing the asset-based loan. Neiman said in response that generating more cash than expected has, in turn, lowered the level of inventories backing the Deutsche Bank loan. The company said it would use cash to replenish inventory back to levels required under the loan. Deutsche Bank on Friday raised concerns about allowing Neiman to continue to have access to the loan financing unless the luxury retailer replenishes a cash collateral reserve meant to protect the bank and other lenders against losses, according to the bank’s court filings. Neiman Marcus filed for bankruptcy in early May with a $675 million bankruptcy loan from large creditors, including Pacific Investment Management Co., Davidson Kempner Capital Management LP and Sixth Street Partners LLC. The company, however, is also relying on a deal with Deutsche Bank and other asset-backed lenders — holders of Neiman’s most senior debt — to use their cash to fund its business during the chapter 11 case.

The U.S. Supreme Court let the liquidator of Bernard Madoff’s investment firm press ahead with efforts to recoup $3 billion from European banks and other overseas investors, Bloomberg News reported. The justices, without comment yesterday, turned away an appeal by investors led by HSBC Holdings Plc who said trustee Irving Picard was impermissibly trying to apply U.S. bankruptcy law to foreign transactions. A federal appeals court let Picard sue the investors. The case affects foreign customers of Fairfield Greenwich Group and other offshore feeder funds that channeled investors’ money to Bernard L. Madoff Investment Securities LLC. The investors include Koch Industries, whose chairman and chief executive officer, Charles Koch, is a major Republican patron. The investors allegedly withdrew more money than they put in before Madoff’s Ponzi scheme collapsed in 2008. The money is the biggest remaining bucket of cash being sought by Picard as he tries to compensate customers who lost $19 billion in principal after Madoff’s arrest. So far Picard has recovered more than $14 billion and distributed more than $13 billion to victims — significantly more than many predicted when he was appointed in 2008.

Deutsche Bank AG , one of Neiman Marcus Group Ltd.’s lenders, says the bankrupt retailer has breached the terms of a $760 million loan, raising concerns about the company’s ability to restructure its business, the Wall Street Journal reported. The department-store chain reported that it overvalued the inventory backing the asset-based loan by $159 million, Deutsche said in a Friday court filing. The overvaluation means Neiman is in default, Deutsche said. Deutsche Bank said that it has “concerns” about allowing Neiman to continue to have access to its cash unless the luxury retailer replenishes a cash collateral reserve meant to protect the bank and other lenders against losses, according to the bank’s court filings. Neiman Marcus filed for bankruptcy in early May with a $675 million bankruptcy loan from large holders of its term loan, including Pacific Investment Management Co., Davidson Kempner Capital Management LP and Sixth Street Partners LLC. The company, however, is also relying on a deal with Deutsche Bank and other lenders of the $760 million asset-based loan — Neiman’s most senior debt — to use their cash to fund its business during the chapter 11 case.

The closing of a $252 million sale of the Philadelphia Energy Solutions oil refinery to a Chicago-based real estate developer has been delayed, Reuters reported. Hilco Redevelopment Partners won an auction in January to purchase the 1,300-acre site along the Schuylkill River in south Philadelphia. The companies were scheduled to close on the purchase agreement by the end of this month. City of Philadelphia officials were told that the closing was delayed, a city spokesman said by email. PES filed for chapter 11 bankruptcy in July and put its refinery, which was the largest and oldest on the U.S. East Coast, up for sale. More than 1,000 full-time workers were laid off, including 640 United Steelworkers. The U.S. Bankruptcy Court for the District of Delaware in February approved the transaction with Hilco, whose plan has been to transform the site into a mixed-use industrial park, and seemingly secured the permanent end to operations at the plant. The bankruptcy judge also signed off on a backup bidder, developer Industrial Realty Group, LLC, in case the deal with Hilco fell through.

The judge overseeing the Boy Scouts of America’s bankruptcy said law firm Sidley Austin LLP can hold on to the job of advising the youth organization over the protests of a former client that is one of the Boys Scouts’ liability insurers, WSJ Pro Bankruptcy reported. The decision from Bankruptcy Judge Laurie Selber Silverstein marks a victory for Sidley and the Boy Scouts, which argued that forcing them to hire new bankruptcy advisers would unsettle their efforts to restructure. The dispute stems from Sidley’s years representing Century Indemnity Co., an insurer that wrote policies covering liability claims against the Boy Scouts. The Boy Scouts hired Sidley in the fall of 2018, seeking advice on how to deal with hundreds of claims of sexual abuse of children at the hands of Scout volunteers. Sidley dropped Century as a client shortly before it guided the Boy Scouts into chapter 11 protection in February. A subsidiary of Chubb, Century protested the law firm’s request to steer the bankruptcy, accusing Sidley of a conflict of interest. The Boy Scouts are counting on insurers including Century to put up money to cover sexual-abuse claims, putting them at odds with the organization. With many American companies considering chapter 11 as a refuge to endure the coronavirus pandemic, law firms are staffing up their restructuring practices. Friday’s ruling concerns the road map for large firms like Sidley that have multiple areas of practice and large client rosters to steer around conflict rules when advising troubled companies. Judge Silverstein said that Sidley’s decision in January to cut ties with its insurance company client kept the law firm in line with bankruptcy rules on conflicts of interest. “Chubb contends that my approval of Sidley’s retention will encourage law firms to impermissibly drop clients in order to take on more lucrative bankruptcy work,” Judge Silverstein said, adding that she didn’t believe that would happen.

PG&E Corp. said yesterday that its chapter 11 reorganization plan has been confirmed by a California power regulator, bringing the power provider one step closer to emerge from bankruptcy and participate in a state-backed wildfire fund, Reuters reported. The decision by the California Public Utilities Commission (CPUC) also approved the company’s request to issue new debt and securities to finance its exit from bankruptcy, PG&E said in a statement. The San Francisco-based utility had filed for chapter 11 bankruptcy protection in January last year, citing potential liabilities exceeding $30 billion from major wildfires sparked by its equipment in 2017 and 2018. The company needs to exit bankruptcy by June 30 to participate in a state-backed wildfire fund that would help reduce the threat to utilities from wildfires. The power provider has had a tumultuous phase since the filing, with CPUC having asked the company in April for governance and oversight changes to its reorganization plan. Governor Gavin Newsom too had previously raised concerns about the plan.

NMC Health PLC, a hospital operator based in the United Arab Emirates that collapsed amid allegations of a multibillion-dollar fraud, filed for bankruptcy protection in the U.S. and could liquidate as it faces shareholder lawsuits over its financial irregularities, the Wall Street Journal reported. The company, which does business mainly in the Middle East but also in other regions, including the U.S., was placed into administration by a U.K. court last month following the discovery of a hole in its books of more than $3 billion. NMC Health yesterday filed for chapter 15 protection in the U.S. Bankruptcy Court in Wilmington, Del. Founded by Bavaguthu Raghuram Shetty, NMC Health operates a network that includes 38 hospitals and 146 medical centers in 19 countries. The Indian-born Shetty and Emirati billionaire Khaleefa Butti Omair Yousif Ahmed al-Muhairi, formerly NMC’s executive vice chairman, resigned from the company’s board in February. The company, now overseen by three Alvarez & Marsal Europe LLP administrators, said the U.S. bankruptcy filing is intended to put a stop to collection and enforcement actions, giving it time to evaluate how to best manage its U.S. medical practices and other assets. World-wide, it has about 20,000 employees, including about 2,000 doctors.

The Diocese of St. Cloud (Minn.) will pay $22.5 million to sexual abuse survivors and declare bankruptcy under the terms of a settlement agreement announced yesterday, the Minneapolis Star Tribune reported. The agreement, subject to a bankruptcy court filing expected in the next few weeks, addresses allegations made against 41 priests by some 70 survivors dating back to the 1950s. Many of the clerics are now dead, though one was still in active ministry as recently as 2015 at St. Andrew’s Catholic Church in Elk River. Attorney Jeff Anderson, who negotiated the settlement agreement on behalf of abuse survivors, said it amounts to “validation and affirmation” for those survivors, some of whom Anderson first represented in lawsuits filed in the 1980s. In 2014, the St. Cloud Diocese released the names of 33 priests who had been credibly accused of sexual abuse. New lawsuits and information boosted that number to 41. The diocese announced in 2018 that it would file for bankruptcy, beginning the negotiations that led to yesterday’s announcement. The agreement also calls for the diocese to turn over its files on the 41 credibly accused priests.

Hertz Global Holdings Inc. paid more than $16 million in retention bonuses to senior managers, including its new chief executive, just days before it filed for bankruptcy on Friday, WSJ Pro Bankruptcy reported. The car-rental company said it agreed to pay a $700,000 bonus to Chief Executive Paul Stone, who was named to the post this month. Chief Financial Officer Jamere Jackson received $600,000 and Chief Marketing Officer Jodi Allen got $189,633, according to a regulatory filing yesterday. In all, Hertz said that it would pay $16.2 million in cash bonuses to about 340 employees in recognition of uncertainty the company and its employees face as a result of the coronavirus pandemic’s impact on travel. Proponents of such payments say they are needed to keep the best executives from jumping ship when they are needed most. Detractors say they are simply another way for top-level managers to enrich themselves. But with many businesses struggling to survive the coronavirus pandemic — Hertz’s revenue in April fell 73 percent from a year earlier — incentive bonuses based on financial metrics are essentially out of reach.