The Celsius Customer Conundrum, Revlon’s Liquidity, A Different Perspective on the Boy Scouts, Lunar Liquidation and Collateral Damage in Voyager | Seward & Kissel LLP

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Below is our initial take on recent bankruptcy-related developments:

Revlon Obtains Court Approval for $1.4 Billion Loan | Reuters

After creditors objected that the $1.4 billion loan could be an obstacle to their ability to recover money from Revlon’s bankruptcy, a U.S. bankruptcy judge approved the loan citing the need for cosmetics company to continue its bankrupt operations.

S&K Take: An unsurprising result here. Revlon now has access to a significant DIP facility that should allow it to maintain the status quo.

Boy Scouts Nears End of Bankruptcy, but Group Faces Challenges | the wall street journal

Last week, a bankruptcy court approved the bulk of a $2.5 billion compensation plan that would resolve more than 80,000 individual sexual abuse claims against the Boy Scouts of America and end the bankruptcy of the organization.

S&K Take: Interesting article as it focuses on the future of the Boy Scouts now that a plan has been confirmed, at least in part. It makes sense that trust needs to be rebuilt, and it will be a long way to go.

Space company Masten files for bankruptcy after struggle with NASA’s Moon contract | CNBC

After receiving a $75 million contract from NASA two years ago to bring transmission units to the moon, Masten Space Systems filed for Chapter 11 bankruptcy due to the extremely expensive and high- space industry risk.

S&K Take: Sounds like a pretty grim case for creditors, although the industry is certainly unique and interesting. The only real asset available to satisfy some large debts is a NASA contract. Most creditors are industry players, so maybe a high risk of low collection is normal.

Bankrupt Crypto Lender Celsius Might Leave Customers Last To Get Paid | Forbes

Ever since Celsius declared bankruptcy last month, customers of the crypto lender have been blocked from accessing their funds. It remains to be seen how the bankruptcy court will categorize Celsius users, but Celsius’s terms of service and court documents indicate that users will be treated as unsecured creditors.

S&K Take: The gauntlet has certainly been thrown down by the debtors, making it clear that the crypto held by Celsius is the property of the bankruptcy estate. However, there appears to be a significant feeling on the part of customers that they have been materially misled, which may affect the validity of the user agreement. I imagine this will be a major focus of the case, and could lead to a long and intense fight between customers and debtors.

Voyager bankruptcy jeopardizes payouts for US female pro soccer players: report | Decrypt

In December 2021, the US National Women’s Soccer League partnered with Voyager Capital. Voyager has since declared bankruptcy, threatening crypto payouts promised to players under Voyager’s sponsorship deal with the NWSL.

S&K Take: Although the claims are unique, they still look like unsecured claims. Customer issues are sure to take priority in these cases, so complaints like these are likely to receive little fanfare.

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