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January 14, 2022 – The Debtor filed a motion to extend the periods during which it has an exclusive right to file a Chapter 11 Plan, and solicit acceptances thereof, through and including June 13, 2022 and August 10, 2022 respectively [Docket No. 295]. Absent the requested relief, the Plan filing and solicitation periods are scheduled to expire on February 11, 2022 and April 12, 2022, respectively. This is the Debtor's first extension request.
The Debtor's motion refers to "certain challenges from its pre-petition lender MUFG Union Bank, N.A." which is perhaps something of an understatement, MUFG having filed a blizzard of objections in mid-December relating to retentions, cash collateral and DIP financing.
Also objecting to use of cash collateral and DIP financing in mid-December were the Debtor's Official Committee of Unsecured Creditors (the “Committee”), with the Committee then noting that "without a concrete path in this case, the proposed financing could provide a 'bridge to nowhere'.”
DIP financing and use of cash collateral were both on the agenda for the Debtor's January 13th hearing as contested matters, with the Debtor's January 14th exclusivity motion, although noting the January 13th hearing and the resolution of other matters, ominously quiet about each of these existential issues beyond the less than optimistic comment that: "the Court recently approved the Debtor’s employment of special counsel to investigate potential claims and causes of action the bankruptcy estate may hold against its pre-petition lender, MUFG Union Bank, N.A. The extensions requested in the Motion will provide the Debtor the opportunity to ….begin these noted investigations…"
The extension motion explains, “This chapter 11 case is progressing, and the Debtor continues to work toward maximizing value for all stakeholders. Since the Petition Date, the Debtor has enjoyed the benefits of the chapter 11 process to stabilize its business and work with important constituents to maximize value, while dealing with certain challenges from its pre-petition lender MUFG Union Bank, N.A. related to a number of things, including use of cash collateral, securing debtor-in-possession financing, providing financial reports, and employing bankruptcy professionals.
….Notwithstanding the progress made to date in this bankruptcy case, the Debtor still has work to do before it is sufficiently informed about how best to exit this case in a way that maximizes value for all stakeholders.”
The motion continues: "As discussed at the January 13, 2022, hearing, the Debtor has settled several outstanding issues with its insurance providers and a certain municipality. It continues to work with other municipalities on other responsible, financially vi able solution. In addition, the Court recently approved the Debtor’s employment of special counsel to investigate potential claims and causes of action the bankruptcy estate may hold against its pre-petition lender, MUFG
Union Bank, N.A. The extensions requested in theMotion will provide the Debtor the opportunity to (a) finalize negotiating with other key credito rs, (b) begin these noted investigations, and (c) develop, file, and solicit a chapter 11 plan that maximizes value for all stakeholders."
A hearing on the motion is scheduled for February 9, 2022.
About the Debtor
According to the Debtor: “Red River, a third-generation family-run waste management services company, was founded in its in current form in 1988 and rebranded with its current name in 1993. Based in Dripping Springs, Texas, and originally known as Midland Maintenance, Red River was founded by Weldon Smith. Smith began the family’s waste management lineage in 1953 by providing refuse collection and disposal services to the United States Army at Fort Sill, the United States Air Force Academy, Fort Benning, Fort Hood and Tinker Air Force Base.
Now operated by Mr. Smith’s son and grandson, Jim and Weldon James, Red River provides solid waste management services for more than 310,000 households and commercial locations across the Southern and Midwestern United States. The Company serves these customers in (i) Huntsville, Alabama; (ii) Fort Wayne, Indiana; (iii) Elizabethtown and Hardin County, Kentucky, (iv) Nashville, Newbern, Union City, Dyer County, Gibson County and Obion County, Tennessee; and (v) Del Rio, Texas. Red River also offers industrial services (such as roll-off containers, self-contained compactors, and stationary compactors), and landfill management.”
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