Cleveland Integrity seeks dismissal of Chapter 11 case following sale

By Sarah Lizee

Olympia, Wash., June 7 – Cleveland Integrity Services, Inc. is seeking dismissal of its Chapter 11 bankruptcy case, according to a motion filed Tuesday with the U.S. Bankruptcy Court for the Southern District of Texas.

The company said that following the sale of its assets to CIS Purchaser, LLC, an affiliate of its prepetition secured lenders, the debtors don’t have enough unencumbered assets to make distributions to general unsecured creditors through a confirmed Chapter 11 plan or conversion to Chapter 7.

The purchase price was a $30 million credit bid, in addition to the assumption of some liabilities and payment of the debtors’ post-petition payroll obligations accrued as of the closing date.

The company said the debtors’ estates exist only to satisfy any outstanding obligations under the purchase agreement and to effectuate an orderly exit from bankruptcy in line with the final debtor-in-possession financing order and the sale order.

“Remaining in Chapter 11 will not serve these goals but will cause the debtors’ estates to continue to accrue professional fees and U.S. trustee fees,” the company said.

The Cleveland, Okla.-based company is a provider of inspection services to oil and gas pipelines. It filed bankruptcy on Jan. 29 under Chapter 11 case number 23-90052.

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