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Party City to Emerge from Bankruptcy with Most Stores Intact
A bankruptcy judge in the Southern District of Texas has approved Party City’s plan to emerge from bankruptcy, multiple sources report. The plan, which will cancel $1 billion in company debt, will enable Party City to close just a “handful” of its nearly 800 stores and save thousands of jobs, Party City attorney Ken Ziman said at a court hearing in Houston, as reported by Reuters.
Ownership of the company will be turned over to the retailer’s current lenders, but the deal will wipe out individual shareholders. “The math is what the math is,” U.S. Bankruptcy Judge David Jones told a shareholder who spoke up at the hearing per Reuters. “It’s one of those things where there simply is not an alternative.”
Under the plan, $1 billion in pre-petition debt will be converted into equity shares, and Party City will receive a new $562 million loan from its existing lenders. The company also will raise additional cash by selling $75 million in new equity shares.
Party City’s junior creditors, including unpaid trade vendors, will receive $3.5 million in cash plus Party City’s share of a $5.6 billion class action settlement related to credit card payment
FTX bankruptcy will be ‘very expensive’ but there’s a reason: Auditor
Fees charged by the lawyers and the restructuring team working on the bankrupt crypto exchange FTX have topped $200 million in just over seven months, but an independent auditor argues it makes sense, given the mammoth task.
On June 20 the court-appointed fee examiner, Katherine Stadler, filed a 47-page report on the fees charged by the law firms in the roughly three months following FTX’s Nov. 11 bankruptcy and concluded they were not “wholly unreasonable in the moment.”
She remarked on the “largely unregulated financial system” in which FTX operates, adding the case was “remarkable” for the exchange’s “global scope, the complete absence of corporate records, and the non-existence of even the most basic corporate governance.”
FTX Professional Fees
This continues to be an extremely expensive case and the Estate has been petitioned for nearly $225mm over 5.5 months (with a couple small stragglers remaining).March fees peaked at $1.6mm PER DAY!
Fortunately, April is trending positively downward. pic.twitter.com/eMTJC3R9Xr
— Mr. Purple ️ (@MrPurple_DJ) June 14, 2023
Stadler confirmed the team working on FTX had “requested more than $200 million in fees” since its November bankruptcy, adding:
“Notwithstanding the relative scope of the known asset pool, these proceedings appear on
FTX’s bankruptcy lawyers and advisers pocket $32.5M in February
February’s round of legal expenses for bankrupt crypto exchange FTX has been published, and it remains a scary figure for debtors.
A series of court filings from April 4 to April 10 detailed the monthly fee statements for February of the law firms involved with FTX’s bankruptcy proceedings, which come to a combined total of around $32.5 million.
The figure didn’t include the recompense for restructuring chief and CEO John J. Ray III, who pocketed $305,000 in February, according to a March court filing.
Ray’s remuneration for March came in at a similar figure, with an April 10 filing showing his total fees and expenses were $329,173.
The FTX chief billed at $1,300 per hour and reported working 255.9 hours for the period of March 1 to March 31. This makes his fees a whopping $327,470, with the remaining $1,703 for airfares, lodging, transport, meals and other expenses.
The law firm Quinn Emanuel Urquhart and Sullivan sought a total of over $2.7 million in reimbursements for February. Partners at the firm billed between $1,246 and $1,917 per hour and associates billed between $747 and $1,183
Lawyers for Genesis and Its Creditors Are ‘Optimistic’ for a Quick Resolution to Bankruptcy Woes
Lawyers for Genesis Global told a federal bankruptcy court in New York City on Monday that they’ve been working with creditors’ representatives and the U.S. Trustee’s Office “around the clock” for the past two months in order to reach a “consensual resolution” with the embattled company’s creditors.
Genesis’ lending arm halted withdrawals on Nov. 18, 2022, after what its lawyers described as “a run on the bank” in the wake of FTX’s collapse earlier that month. Two months later, on Jan. 19, Genesis Global Holdco – the holding company of Genesis Global Capital – and two of its subsidiaries, Genesis Asia Pacific (GAP) and Genesis Global Capital (GGC), global-files-for-bankruptcy-protection/” data-ylk=”slk:filed for Chapter 11 bankruptcy protection” class=”link “filed for Chapter 11 bankruptcy protection in New York.
Genesis’ lawyers – from the New York-based law firm Cleary Gottleib – told bankruptcy court Judge Sean H. Lane at a hearing on Monday they expect to reach an agreement with the creditors by the end of the week.
“We have a timeline and an approach to get through this case as quickly as possible,” Genesis attorney Sean O’Neal told the judge. “We really want to avoid getting involved in a prolonged