Free Speech Systems: Plan confirmation hearings set for March

By Sarah Lizee

Olympia, Wash., Feb. 12 – Free Speech Systems LLC owner Alex Jones and the official committee of unsecured creditors will have their Chapter 11 plans considered for approval at hearings scheduled for March 25 through March 27, according to a notice filed Friday with the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, Jones and the committee have filed competing Chapter 11 plans for Jones. Both disclosure statements were approved by the court.

For background, Jones and his Free Speech Systems company filed separate Chapter 11 cases in 2022. Jones posted at least $1.5 billion in liabilities and was facing litigation on the brink of judgment at the time.

The Free Speech debtor had filed a Chapter 11 subchapter V small business plan of reorganization back in March 2023, and the committee proposed its own plan for the debtor in November.

Jones’ most recent plan provides for the reorganization of the debtor and the payment of allowed claims through the continued orderly liquidation of certain non-exempt assets of the debtor, and the debtor’s commitment to contribute funds from his future income.

Jones will contribute 100% of the net disposable income of Free Speech Systems and 50% of Jones’ plan income over five years and 25% of Jones’ plan income over an additional five years. The minimum annual distribution is set at $5.5 million.

As a result, all administrative claims, priority claims and secured claims will be paid in full, and unsecured creditors will receive a distribution.

Jones’ plan also allows for unsecured creditors to opt in to a “settling class” allowing for faster payment of their claims and repayment from some exempt assets of the debtor in exchange for settlement of certain existing litigation claims.

Under the committee’s liquidation plan for Jones, each holder of a general unsecured claim will receive, at the holders’ election, their pro rata share of a $50,000 cash pool, or their pro rata share of GUC trust interests.

The GUC trust assets will include all Jones’ assets, rights and claims that are not exempt assets, whether owned by Jones directly, indirectly, or otherwise held for the benefit of Jones existing as of the effective date, and 100% of Jones’ equity ownership interests in Free Speech Systems, PQPR Holdings Ltd. LLC, all assets held in the Jones trusts, litigation assets and other amounts.

Austin, Tex.-based Free Speech Systems filed bankruptcy on July 29, 2022 under Chapter 11 case number 22-60043. Jones’ Chapter 11 case number is 22-33553.

© 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.