Rebuffed in Bankruptcy Court, the Government Wins a Stay of Voyager’s Confirmation
The U.S. Attorney argued in district court that the Voyager plan would bar the government from enforcing federal regulations and criminal laws.
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WeWork Starts Bond Exchange as Part of Debt-Restructuring Plan
WeWork Inc. said it is offering to swap two sets of bonds worth about $1.2 billion for new debt and stock as part of a sweeping restructuring effort, Bloomberg reported. The company is seeking to exchange its 7.875% notes due 2025 and 5% bonds due 2025, according to a statement. Terms for investors depend on if they agree to participate in a new debt financing for the company. Bondholders who agree to purchase the company’s new 15% first-lien pay-in-kind notes due 2027 can swap their holdings for a mix of new second-lien notes and stock, or a larger stock-only allocation. Those that don’t buy the PIK notes can get new third-lien notes and stock, or all stock. The new first-lien PIK notes pay 7% in cash and 8% in-kind. The second-lien and third-lien bonds also have PIK portions, and have 11% and 12% coupons, respectively. All mature in 2027. WeWork, the struggling co-working company, struck a deal last month to shave off about $1.5 billion of debt on a net basis and receive more than $1 billion of capital commitments.
Delaware and New York District Courts Split on Permissibility of Non-Debtor Releases
Upholding confirmation of the Boy Scouts’ chapter 11 plan, the district judge in Delaware disagreed with his counterpart in New York who found no statutory power to impose non-consensual, non-debtor third-party releases.
Bankruptcy Code
Renewing a Title Loan Just Before Chapter 13 Didn’t Make the Filing in Bad Faith
Ruling the other way would have barred chapter 13 filings after renewing title loans.
Oversecured Creditor Granted ‘Default’ Interest on a Loan Purchased at Discount
District judge in Connecticut upheld an award of ‘default’ interest, even though the fully secured lender had opposed the chapter 11 process and resisted the use of its cash collateral.
Alex Jones Would Get $520,000 Salary Under Bankruptcy Plan
Alex Jones' media company has proposed a plan in its bankruptcy case to pay the conspiracy theorist $520,000 a year while leaving $7 million to $10 million annually to pay off creditors, including relatives of Sandy Hook shooting victims, ABC News reported. The Sandy Hook families won nearly $1.5 billion in lawsuits last year against the Infowars host, for his calling the 2012 shooting that killed 20 children and six educators in Newtown, Connecticut, a hoax perpetrated by crisis actors. The families also said they were harassed and threatened by Jones' followers. But it remains unclear how much money the Sandy Hook families will actually get from Jones and Infowars' parent company, Free Speech Systems. Jones is appealing the verdicts and has said on his show that he has $2 million or less to his name. Free Speech Systems, owned solely by Jones, filed a proposed reorganization plan Tuesday in its chapter 11 bankruptcy case in Houston that predicts it will have $7 million to $10 million annually after expenses to pay creditors from 2023 to 2027. The judge in the case, which was filed last year, would determine who gets that money and how much. The new filing shows the company expects to sell more than $30 million a year in dietary supplements, which Jones hawks on his show and are the company's main source of income.
Revlon Says: Creditors Lack Standing to Assert Claims of ‘General Interest to the Estate’
A creditor with ‘derivative’ claims based on preference or fraudulent transfer can’t convert them to ‘direct’ claims by asking for equitable relief.