Fort Worth-Based Firm Successfully Confirms Four Reorganization Plans During First Half of 2022
FORT WORTH, Texas, Aug. 16, 2022 /PRNewswire/ -- The bankruptcy and reorganization team at Fort Worth's Forshey Prostok, LLP successfully confirmed four bankruptcy plans during the first half of 2022, continuing the Fort Worth-based bankruptcy and reorganization boutique's string of success in all areas of the reorganization practice.
"Because of the pandemic, many businesses faced severe financial difficulties in 2020 and 2021; but, thankfully, that wasn't the end of the story," says name partner Jeff P. Prostok, the firm's managing partner. "Thanks to a lot of hard work by my colleagues, many of these businesses are emerging from the bankruptcy process on a healthier financial footing, ready to serve their customers and support their communities."
The Hospital operates the Faith Community Health System in Jack County, Texas, and the Faith Community Hospital in Jacksboro, Texas. The Debtor was organized under the Texas Constitution and Chapter 1079 of the Texas Special District Local Laws Code. As a municipality, the Hospital was required to file under Chapter 9 of the Bankruptcy Code.
The Forshey Prostok team assisted the Hospital with back-to-back Chapter 9 cases to allow the Hospital to take full advantage of pandemic-related financial relief available through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The Hospital voluntarily dismissed its first Chapter 9 case so that it could apply for a Paycheck Protection Program (PPP) loan that was not available to bankruptcy debtors. This allowed the Hospital to receive desperately needed funds during the most challenging period of the pandemic and permitted the Hospital to file its second Chapter 9 case with the financial wherewithal to successfully reorganize.
Ultimately, the team at Forshey Prostok assisted the Hospital in confirming a Plan of Adjustment providing for a restructuring of roughly $92 million in debt, thereby allowing the Hospital to continue delivering high-quality healthcare services to an underserved region.
Partners Jeff P. Prostok and Lynda L. Lankford and Associate Dylan T.F. Ross represented Flexible Funding Ltd. Liability Co. and Instapay Flexible, LLC in their jointly administered Chapter 11 bankruptcy cases.
Flexible and Instapay are privately held asset-based lending and factoring companies, primarily focused on the staffing and transportation industries. Immediately after filing the two Chapter 11 bankruptcy cases, the team at Forshey Prostok sought the expedited auction and sale of the Debtors' portfolio assets. After two successful competitive auctions, the Debtors sold the portfolio assets – at a premium – for more than $85 million. The expedited relief allowed the Debtors to close the two asset sales within the first seven weeks of the Debtors' bankruptcy cases, thereby preserving the portfolio value of the assets and permitting the Debtors to retire all of their senior secured debt.
Following the sales, Forshey Prostok successfully confirmed a Joint Plan of Liquidation for Flexible and Instapay that provides for the Debtors' substantive consolidation and the efficient liquidation of remaining assets to maximize distributions to creditors.
Partner Jeff P. Prostok and Associate Dylan T.F. Ross represented LWO Acquisitions Company LLC, d/b/a Circuitronics, Inc. in its Chapter 11 bankruptcy case. Circuitronics is a provider of specialized printed circuit board assembly and related electronic manufacturing services.
The COVID-19 pandemic severely impacted Circuitronics' business, which relied substantially on a customer that supplied media and sound equipment for large festivals and music venues that virtually shut down during the pandemic. Circuitronics was further hampered by an economically burdensome office lease that placed the duty to maintain an increasingly unstable building on Circuitronics.
In the bankruptcy case, the attorneys at Forshey Prostok first assisted the Debtor in rejecting the burdensome office lease, and then helped confirm a Plan of Liquidation providing for the sale of substantially all of the Circuitronics assets and payment of the majority of creditor claims in full. The sale allowed operations to continue post-bankruptcy, thereby preserving jobs and the going concern value of the business.
Partner Lynda L. Lankford represented Four New Millennium Group, Inc. (d/b/a Sneaky Pete's) in its successful reorganization under Chapter 11 (Subchapter V).
Sneaky Pete's operates the largest restaurant on the shores of Lake Lewisville and has been an institution and familiar gathering place for multiple generations of families and friends since its inception in 1989. During the pandemic, Sneaky Pete's was forced to shutter operations for an extended period, ultimately resulting in the landlord declaring that the lease had been terminated.
In the bankruptcy case, Sneaky Pete's attorneys successfully defeated the lease challenge, allowing Sneaky Pete's to continue operations and emerge from bankruptcy with a Plan of Reorganization providing for payment in full of all non-insider creditor claims.
About Forshey Prostok LLP
Forshey Prostok LLP provides extensive experience in all areas of bankruptcy law from its offices in Fort Worth, Dallas, and Houston. The firm's scope of representation includes handling complex business reorganizations, enforcing of creditor's rights, leading commercial and bankruptcy-related litigation, overseeing creditors' committees, directing workouts, and closing bankruptcy acquisitions. Forshey Prostok is ranked by the Chambers USA legal guide and received a Tier 1 ranking from Best Law Firms for bankruptcy and creditor/debtor rights. For more information, visit https://forsheyprostok.com/.
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