Celsius considers other bids, delays disclosure statement filing

By Sarah Lizee

Olympia, Wash., April 14 – Celsius Network LLC has been negotiating with several other bidders since filing its Chapter 11 plan, which is centered on NovaWulf Digital Management, LP acting as stalking horse bidder, the company said in documents filed Thursday with the U.S. Bankruptcy Court for the Southern District of New York.

The debtors filed the plan on March 31, and expected to file a disclosure statement by April 12.

However, since discussions have continued with other bidders to develop alternative bids ahead of the April 17 bid deadline, Celsius said it isn’t prepared to file a disclosure statement or provide estimated recoveries for creditors under the plan yet.

As such, the debtors, the official committee of unsecured creditors and NovaWulf agreed to extend the deadline to file a disclosure statement to April 28.

The May 17 hearing to consider approval of the disclosure statement has been adjourned to a date to be determined.

As currently proposed, the plan provides for the distribution of a significant amount of the debtors’ liquid cryptocurrency to account holders on the effective date of the plan, and creation of a new public-reporting, regulatorily compliant entity (NewCo) that will manage the debtors’ illiquid assets (including the mining business, retail and institutional loan portfolios, staked cryptocurrency, and other alternative investments) and whose common equity will be 100% owned by creditors at emergence.

Certain claims and causes of action of the debtors will be preserved and pursued by a litigation administrator for the benefit of general Earn creditors.

Distributions will be funded with cash on hand, including from Novawulf’s $45 million management contribution and net proceeds from the sale of the GK8 assets; available cryptocurrency; the equity share tokens and management share tokens; and litigation proceeds.

The Hoboken, N.J.-based cryptocurrency lending platform filed bankruptcy on July 13, 2022 under Chapter 11 case number 22-10964.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.