Red River Waste’s disclosure statement draws several objections

By Sarah Lizee

Olympia, Wash., July 26 – Red River Waste Solutions, LP’s amended disclosure statement for its Chapter 11 plan drew objections from the official committee of unsecured creditors, MUFG Union Bank, NA and TBK Bank, SSB, formerly known as Triumph Savings Bank, according to court documents filed with the U.S. Bankruptcy Court for the Northern District of Texas.

Part of the disclosure statement discusses a settlement with Union Bank.

The committee said that, in the settlement information section, there is “entirely new language” regarding committee professional fees, which isn’t found in the settlement documentation.

The committee said the new provisions attempt to have 25% of the committee’s professional fees deferred into a liquidating trust waterfall.

“This is brand new language, drafted for the very first time without any consultation with the committee beforehand, and not found anywhere in the Union Bank settlement,” the committee said. “Nor should it have been in there, because it is not what the committee agreed to.”

Meanwhile, Union Bank said the disclosure statement doesn’t provide enough information. In its limited objection, the bank said the statement shouldn’t be approved to the extent that the plan and statement are not consistent with the settlement.

Triumph had different concerns relating to the plan, specifically when it comes to the transfer of its truck collateral over to buyer Platform Waste Management, LLC.

Triumph said the debtor had initially excluded it and its collateral from the sale to Platform, but now, the proposed plan contemplates the debtor potentially leasing Triumph’s truck collateral directly to Platform, and then taking money from the lease to pay Triumph on account of a secured note.

“Why would the debtor undertake this administrative burden, when it yields no benefit to the estate?” Triumph said in its objection. “On information and belief, the debtor is attempting an end0run around the sale process in order to avoid a downward adjustment to the sale purchase price.”

Triumph said it is being forced to evaluate “entirely new treatment and concepts,” including the secured note and the Platform lease, which were not contemplated in the prior disclosure statement and plan, nor discussed with Triumph ahead of time.

The disclosure statement hearing is scheduled for July 28.

The Dripping Springs, Tex.-based waste management company filed bankruptcy on Oct. 14, 2021 under Chapter 11 case number 21-42423.

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