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Bed Bath & Beyond Inc. said it doesn’t have the funds to repay its banks after they determined the retailer has defaulted on its credit lines, WSJ Pro Bankruptcy reported. The home-goods chain said Thursday it received a notice of default from JPMorgan Chase & Co. on Wednesday. The banks are calling for an immediate repayment of all outstanding loans under the credit agreement. The company has $550 million in loans outstanding from the banks led by JPMorgan, as well as $375 million from a facility provided by Sixth Street Partners, according to a securities filing. It had $154 million in unrestricted cash and equivalents in late November. As a result of the default, Bed Bath’s interest rate goes up by 2 percentage points, according to the filing, and it is required to put up cash collateral to back letters of credit, which are often tapped for payments to suppliers. The company has $186 million in outstanding letters of credit. Bed Bath & Beyond has racked up losses as its sales have plummeted, the result of a failed turnaround that swapped name brands such as KitchenAid mixers and Calphalon cookware for private-label goods that didn’t resonate with shoppers. The chain has had trouble stocking its stores after it fell behind on payments to suppliers.

FTX has objected to a U.S. Department of Justice request for an independent investigation into the once-prominent crypto exchange's collapse, saying it is already conducting a wide-ranging probe that includes family members of FTX founder Sam Bankman-Fried, Reuters reported. FTX said in a court filing in Wilmington, Delaware, late on Wednesday that the DOJ's proposed review would only add cost and delay to its bankruptcy case. FTX acknowledged "fraud, dishonesty, incompetence, misconduct, mismanagement, and irregularity" in its past conduct, but said that its previous wrongdoing is already being probed by the company's new management, its creditors and law enforcement agencies. As part of its own investigation, FTX asked U.S. Bankruptcy Judge John Dorsey, who is overseeing its chapter 11 proceedings, to help it secure documents from Bankman-Fried, members of his family and other insiders with information about FTX transactions that used "misappropriated and stolen" funds. These transactions, it said, include a $16.7 million Bahamian real estate purchase under the name of Bankman-Fried's parents, Joseph Bankman and Barbara Fried. FTX is also seeking information about political donations by Mind the Gap, a political action committee founded by Barbara Fried, and Guarding Against Pandemics, an advocacy organization founded by Sam Bankman-Fried and his brother, Gabriel Bankman-Fried. FTX said Guarding Against Pandemics' multimillion-dollar Washington, D.C., headquarters was purchased with misappropriated funds.

New Jersey-based cryptocurrency lender BlockFi has requested the court to approve bonus paychecks for its staff so the company can keep its talent throughout its bankruptcy proceedings, according to court documents filed on Monday, YahooFinance.com reported. “Despite an incredibly turbulent time in the digital asset industry, the opportunities for participants elsewhere have not dried up,” BlockFi Chief People Officer Megan Crowell said in a submitted declaration. “The war for talent remains active, and the participants have many opportunities inside and outside the cryptocurrency sector.” Last week, Zodia Markets, a digital asset exchange based in London, hired the former BlockFi head of international’s institutional sales in Asia, Paul Howard, as its own head of sales. BlockFi fired about two-thirds of its workforce and filed for chapter 11 bankruptcy in late November following the collapse of the Bahamas-based cryptocurrency exchange, FTX.com. Sam Bankman-Fried, the founder of the exchange, had agreed to a deal to rescue BlockFi from earlier financial woes in July, before FTX filed for its own bankruptcy on Nov. 11. The unsecured creditors' committee has submitted objections to BlockFi’s retention plan, while the U.S. Trustee in the case objected to the lender’s decision to seal from the public details on the proposed payments and recipients. A lawyer representing the unsecured creditors' committee argued in the court filings that BlockFi is seeking permission to spend US$12.3 million for retention payments and up to another $12 million in estate resources and fees.

The chapter 11 trustee for a collapsed United Furniture Industries Inc. was approved on Wednesday by a bankruptcy judge, the Winston-Salem (N.C.) Journal reported. Derek Henderson was selected as the trustee by a federal bankruptcy trustee after being signed off on by United and its creditors, led by Wells Fargo & Co. The chapter 11 motion approved on Jan. 18 for United gives the manufacturer the opportunity to direct the sale of its assets with the oversight of a trustee. United unexpectedly shut down Nov. 22, immediately ending employment and health insurance benefits for 530 Triad employees and about 2,700 companywide. Among its assets is the 850,000-square-foot production facility at 401 W. Hanes Mill Road in Winston-Salem. Wells Fargo filed a motion for chapter 7 liquidation of the manufacturer’s assets and the appointment of a bankruptcy trustee. The bank said in a Dec. 30 court filing requesting the chapter 7 liquidation of United that it is owed $99.21 million in secured debt. However, the bank acknowledged it “estimates that any recoveries from liquidation of (United’s) collateral will result in a recovery equal to a fraction of this amount.”

A Tampa, Fla.-based food hall operator has filed for chapter 11 protection to reorganize the debt on an Orlando location, the Tampa Bay Business Journal reported. Jamal Wilson, who launched his food halls with The Hall on Franklin in 2017, told the Tampa Bay Business Journal on Wednesday that he is reorganizing his debt "due to high construction costs" during the COVID-19 pandemic. Wilson's Orlando location, The Hall at the Yard, opened in 2021. The bankruptcy filing will not affect day-to-day operations at The Hall at the Yard, Wilsons said, and he doesn't plan to file for bankruptcy protection for any other locations. "The cost of the tenant improvements was higher than expected," according to the bankruptcy filing. "Unfortunately, the debtor borrowed funds from various MCA lenders. The debt to the MCA lenders and the exorbitant fees and costs associated therewith has been crippling. The debtor filed this case to restructure its debts and reorganize for the benefit of all creditors." The filing lists 10 MCA lenders who are owed a combined $901,055, though the amount owed to G and G Funding Group LLC is unidentified. The lenders are owed amounts ranging from $44,000 to $181,000. Secured debt also includes a $4.2 million loan to Newtek Small Business Finance. There is also a $359,000 Paycheck Protection Program loan from Kabbage LLC that is "likely unsecured," according to the filing. The largest unsecured creditors have claims that range from unknown to $119,000.

Heritage Power LLC, a power-plant operator owned by GenOn Holdings LLC filed for bankruptcy with a lender backed-plan to trim debt from its balance sheet, saying its business has struggled because of low electricity prices and operational problems during extreme winter weather last month, WSJ Pro Bankruptcy reported. Heritage said in papers filed Wednesday in the U.S. Bankruptcy Court in Houston that it has struck a deal with its owner, GenOn, and its lenders on a chapter 11 plan to either restructure $686 million in debt or explore selling its assets. The agreement is backed by lenders that own 80% of its $485 million in outstanding term loans, according to court documents. The bankruptcy marks the second time Heritage power plants have passed through chapter 11 since 2017. Heritage and its affiliates were part of the earlier bankruptcy of GenOn, which emerged from chapter 11 in December 2018. GenOn employees manage Heritage, which operates more than a dozen oil- and natural-gas-fired power plants in three states. Heritage President David Freysinge said GenOn formed the companies involved in the current bankruptcy in 2019 to separately own and operate the power plants in New Jersey, Pennsylvania and Ohio. Heritage sells its power to PJM Interconnection LLC, which operates a power grid serving roughly 65 million customers across 13 states and the District of Columbia.

Brazilian shopping chain Americanas SA yesterday filed for chapter 15 bankruptcy, a move that protects its U.S. assets while insolvency proceedings play out in its home country, Bloomberg News reported. The retailer nosedived in January after becoming mired in an accounting scandal. The firm, backed by billionaire Jorge Paulo Lemann, filed for bankruptcy at a court in Rio de Janeiro on Jan. 19. In disclosures to investors, the firm implied it misreported numbers connected to some of its financing and wrongly deducted interest paid to lenders from its liabilities. In all, there were nearly $4 billion of accounting “inconsistencies,” according to a regulatory filing.

Developer AD1 Global Hotels LLC put eight Florida properties using Marriott, Hilton, Hyatt and IHG brands under bankruptcy protection, blaming rising interest rates, Hurricane Nicole and allegedly unreasonable demands by lender HPS Investment Partners LLC, WSJ Pro Bankruptcy reported. The Hollywood, Fla.-based parent company of the hotels isn’t part of the bankruptcy. It plans to seek an equity investor for the properties, and potentially refinance their debt and sell assets. The bankruptcy filing covers eight newly constructed or renovated properties that owe $165 million to HPS Investment Partners, according to a filing Wednesday in the U.S. Bankruptcy Court in Wilmington, Del. AD1’s chief operating officer, Alex Fridzon, said in a declaration in bankruptcy court the portfolio of properties has been valued at $210.5 million to $262 million. AD1’s portfolio has more than 25 properties. Roughly a third, with a total of more than 1,200 rooms, are part of the bankruptcy case.

Celsius Network LLC is considering issuing a new digital-asset token to repay creditors as part of a proposal to reorganize and exit bankruptcy as a regulated crypto platform, the company said in court yesterday, Bloomberg News reported. Reorganizing Celsius into a publicly-traded company that is properly licensed would bring in more money for creditors than selling hard-to-liquidate assets at today’s depressed prices, company attorney Ross M. Kwasteniet said during a video-court hearing. Celsius has been negotiating with various creditor groups over how to set up the new company and issue a new token to creditors as part of a payout plan, Kwasteniet told US Bankruptcy Judge Martin Glenn, who is in New York. Another troubled crypto platform had created digital assets to cover customer losses, but Celsius is likely the first crypto company to try to issue a new token — which must be blessed by a federal judge — to help buy its way out of bankruptcy. A group of creditors has been pushing Celsius to follow the example set by the Bitfinex exchange, which issued new tokens to customers who lost money due to a hack. In September, a Beijing-based provider of Bitcoin mining-pool services said it would issue tokens to clients equal to the value of various crypto assets that had been frozen.

Binance Holdings Ltd., the world’s largest crypto platform, acknowledged that it mistakenly keeps collateral for some of the tokens it issues in the same wallet as exchange-customer funds, Bloomberg News reported. Reserves for almost half of the 94 coins that Binance issues, known as Binance-peg tokens or “B-Tokens,” are currently stored in a single wallet called “Binance 8” which also holds customer assets, according to listings visible on its website on Monday. The wallet contains significantly more tokens in reserve than would be required for the amount of B-Tokens that Binance has issued, indicating that collateral is being mixed with customers’ coins rather than being stored separately, as has been done for other Binance-peg tokens according to the company’s own guidelines. “‘Binance 8’ is an exchange cold wallet. Collateral assets have previously been moved into this wallet in error and referenced accordingly on the B-Token Proof of Collateral page,” a Binance spokesperson said. “Binance is aware of this mistake and is in the process of transferring these assets to dedicated collateral wallets.” Crypto exchanges such as Binance have attempted to be more transparent about their holdings following the collapse of rival platform FTX in November, which turned the management of reserves into a hot-button issue for the crypto industry. FTX, the Bahamas-based exchange founded by Sam Bankman-Fried, allegedly allowed its sister trading firm Alameda Research unfettered access to customer assets to fuel its own bets — and with billions of dollars at stake, customers are eager to spot any potential warning signs of trouble elsewhere.