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Chapter 11 announced - Part 11 - Judge's Opinion


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Big change in BSA's financials.

17c7637d-c326-4612-9685-10cfeb89a4f0_10280.pdf (omniagentsolutions.com)

They transferred their entire Unrestricted RBT Balance to cash.  So, their cash went to $83.65M; however, their RBT Balance is now at $0.

The RBT is their "Retirement Benefits Trust".  

They also state they have $63M additional in cash set aside to pay JPM as they exit.

Their bankruptcy fees dropped (which is a bit odd).  THey showed a decrease of $5.9M in professional fees.  Total is now $362M.

 

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I have nothing to say that is worthy of much attention, other than I am SOOO VERY grateful for Eagle1993 and his excellent reverse engineering of this opinion, and other such. I, for one, am indebted

Final plan & exhibits were uploaded last night.  Century supports the updates; however, we may see some fireworks with Guam and possibly the judge.   3b0d7c7a-ca0e-4eab-ad84-f43950dc2b65_1029

A flurry of action today: - The Judge approved the BSA/GSUSA agreement to stop suing each other: cd5eb23c-6a2c-4c70-a015-dc989fbfd257_10193.pdf (omniagentsolutions.com) - The US Trustee/DOJ

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Hearing has started and ongoing.  It seems clear the plan will be approved; however, some minor changes will be required (at least so far).  It could take a few days as they need to notify some other parties of changes.  

This will not go into effect until post appeal approval (so even after the plan is approved, BSA and others agreed it isn't effective immediately).  That also means BSA cannot say appeals are moot as they already implemented th plan.

 

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17 minutes ago, Eagle1993 said:

Hearing has started and ongoing.  It seems clear the plan will be approved; however, some minor changes will be required (at least so far).  It could take a few days as they need to notify some other parties of changes.  

This will not go into effect until post appeal approval (so even after the plan is approved, BSA and others agreed it isn't effective immediately).  That also means BSA cannot say appeals are moot as they already implemented th plan.

 

What are your thoughts on a timetable going forward?

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DI-Gyu9WAAAj5rg.jpg

 

All joking aside, I do not think BSA, nor councils, can survive. I looked at the revised plan found Revised plan found at https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/7f73fba1-1980-4766-a6b3-d80e203fd73f_10263.pdf and I got concerns. Especially since I know one council plans to sell properties and reinvest the money into the main property. Yet the doc above says they are suppose to go tot the trust.

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25 minutes ago, Eagle1970 said:

What are your thoughts on a timetable going forward?

Not an expert but one reference is Purdue as it is another complex bankruptcy case.  The latest plan was approved March 9, but there has been on appeals ruling yet.  Also, that one already went through District which took 2 months.  So ... if similar ... 8+ months?  Just attempting to ballpark this comparing to a similar case.  

I know district on Purdue took 2 months and that was considered very fast (and they rejected the plan).

So, in Purdue, they are 1 year past their original plan confirmation date.  So, it is very possible we are talking 12+ months, but my hope is closer to 4-6.

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15 hours ago, Eagle1993 said:

 $368 is simply the direct bankruptcy costs paid by BSA.

... Paid by BSA ... help me with my understanding.   BSA is also paying costs for legal costs for those with claims and overhead.  In addition, Omni, land appraisals. etc, etc.   So, I'm reading it as BSA is not spending $13m per month defending itself or being oppositional.  BSA is paying costs from many sides.  ... Please correct me if I'm wrong.

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34 minutes ago, Eagle94-A1 said:

DI-Gyu9WAAAj5rg.jpg

 

All joking aside, I do not think BSA, nor councils, can survive. I looked at the revised plan found Revised plan found at https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/7f73fba1-1980-4766-a6b3-d80e203fd73f_10263.pdf and I got concerns. Especially since I know one council plans to sell properties and reinvest the money into the main property. Yet the doc above says they are suppose to go tot the trust.

What is key is really Exhibit F.  In the end, as long as local councils in total provide $500M in cash & properties + $125M note they are free and clear.  If they miss this by $1, no council will have any protection.  There is a breakdown of donated property; however, that is subject to change if they provide cash vs property.

I think if they sell property, they are supposed to notify the court.  However, I know places are being sold and it seems like those concerns are no longer present as there is the $625M settlement agreement.

So, basically, BSA will need to herd the cats and ensure all make their contribution.

 

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2 minutes ago, fred8033 said:

... Paid by BSA ... help me with my understanding.   BSA is also paying costs for legal costs for those with claims and overhead.  In addition, Omni, land appraisals. etc, etc.   So, I'm reading it as BSA is not spending $13m per month defending itself or being oppositional.  BSA is paying costs from many sides.  ... Please correct me if I'm wrong.

Correct.  BSA is directly paying their lawyers, TCC lawyers, Omni, consultants, Trustee, etc.  The only people they are not directly paying is individual claimant counsel (and actually some of them are attempting to get paid from the trust directly).

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4 minutes ago, Eagle1993 said:

The only people they are not directly paying is individual claimant counsel (and actually some of them are attempting to get paid from the trust directly).

Yes. The Coalition to the tune of 20M claims. One of the Coalition principals is front row, center in court today. 

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By way of court color commentary, we've already had three recesses. One was because the judge had no Zoom feed. Another because we were exceeding online capacity. People were being dropped and/or denied access. Mid-morning, the number of Zoom attendees capped out the 1000 mark and they had to upgrade. The third recess was due to the attorney then appearing and speaking had a hiccup attack. To this humble reporter, the poor fella seemed on the verge of being sick. 

This post is intended as a substantive process report for those unable to attend this important proceeding.  

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One point of that $80+M of cash + the $63M reserved for JPM.  Based on the plan, as soon as it is effective (post appeal) BSA must pay all by $25M or so of their cash/non restricted assets and a big chunk to JPM.  So, I expect most of their current cash will go away and be paid out post effective date.

They also state they will get a $48M loan from the foundation to survive after they pay out most of their cash.

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Next steps ... order has some very discrete changes & process will be quick.  Guam claimants will have some time to review and will be served.  

Status conference to be setup next week Wednesday; however, unlikely needed.  If needed, will be very short and zoom only (save BSA$ on travel).  

So, expect plan approval Wednesday/Thursday next week (or earlier).  

Judge ... "interesting case".

 

 

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And the question on every Survivor's mind...."Judge, you had EVERYONE there.  They flew in to town to get things done and get this finished.  Why didn't you send them out into a meeting room, or tell them to hammer it out overnight, and finalize it?"  Bonus question to the BSA... "How do you feel knowing that the issue EVERYONE knew about, Guam and Century, wasn't addressed before today and Guam stated NO ONE reached out to her?  The result being travel expenses for your professionals and the TCC's as well as continued expenses to get this done in the next six days?"  It will get done.  It will cost the BSA more.  It's headed to District Court review with appeals teed up by insurers and Guam.  In the mean time, let's see if Century decides any sort of resolution isn't acceptable and pulls or lowers its offer because it will have continued exposure with Guam.  Then what dominoes fall?  Then who says "No DICE, NOT the deal we agreed to"  The 800-pound Gorilla is still sitting by patiently waiting to be addressed.  It wasn't today.  Should be an interesting weekend for the BSA's attorneys as they scramble to make this work.

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1 minute ago, MYCVAStory said:

In the mean time, let's see if Century decides any sort of resolution isn't acceptable and pulls or lowers its offer because it will have continued exposure with Guam. 

Very good point.  I don't think the Guam claimants can disrupt this much.  However, if Century pulls out then the plan is dead.  Tanc made an ominous appearance just before the zoom call ended.  There is one piece that is being discussed that Tanc indicated was critical to not change materially.  The judge went back and forth with Tanc and she said as long as it is consistent with the plan she is fine.... and Tanc seemed to agree.  However, it was a bit disconcerting.  

I still think 99% chance this is approved and agree, it should have been done tonight.

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