NextPoint starts Chapter 15 process in Delaware bankruptcy court

By Sarah Lizee

Olympia, Wash., July 26 – NextPoint Financial Inc. started its previously announced Chapter 15 proceedings in the U.S. Bankruptcy Court for the District of Delaware on Wednesday.

As previously reported, the company initiated Companies' Creditors Arrangement Act proceedings on Tuesday. The Chapter 15 filing seeks U.S. recognition of those proceedings.

The company’s approximately 2,200 Liberty Tax franchised locations are not part of the proceedings.

RSA

NextPoint has entered into a restructuring support agreement with lenders BP Commercial Funding Trust, Series SPL-X and BP Commercial Funding Trust II, Series SPL-I and Drake Enterprises Ltd.

BP Commercial has agreed to purchase substantially all of NextPoint’s assets for up to $281 million, primarily consisting of a credit bid of at least $100 million of secured debt, cash to be paid at closing and obligations assumed.

Under the terms of the agreement, the transaction will be implemented through a court-approved sale and investment solicitation process in which the senior lender's stalking horse bid will be subject to higher or otherwise better offers from interested third parties.

DIP

All three lenders have committed $25 million in debtor-in-possession financing.

The facility will provide liquidity to fulfill ongoing obligations to franchisees and customers and pay employees and vendors in the ordinary course.

Other steps

NextPoint appointed a new chief executive officer, Scott Terrell, effective immediately. He has worked in other roles with the company, most recently as interim chief executive officer in May.

DLA Piper (Canada) LLP and DLA Piper LLP (US) are serving as legal counsel to the company in Canada and the U.S., respectively, and Province is serving as its financial restructuring adviser. As previously announced, Peter Kravitz of Province is serving as NextPoint's chief restructuring officer.

NextPoint is a Hurst, Tex.-based marketplace for financial services aimed at underserved consumers and small businesses. The Chapter 15 case number is 23-10983.

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