1. Meeting Summary
This hearing was largely about stabilizing the case procedurally and narrowing several contested issues. The debtor represented that there is now an agreement in principle on continued use of cash collateral, subject to tighter controls. The key points were that all reporting will move to a weekly cadence, including a retroactive report back to the February 4 petition date, and the debtor will appoint a CRO, with final details still to be worked out. That was an important development because Tiger and the committee made clear that their core issue remains lack of trust in the debtor's historical financial reporting, and they view the CRO and enhanced reporting as essential safeguards.
The parties also reached agreement on affiliate salary. Matt King will receive compensation annualized at $360,000 effective as of this hearing date, and Tiger, the committee, and the debtor agreed there would be no effort to disgorge the difference between that amount and prior compensation previously approved and paid under court order through this date. Tiger emphasized that this accommodation is based on the expectation of full cooperation, meaningful reporting, and transparency going forward.
On the Four Daughters lease issue, the debtor indicated it will file a motion to reject the lease effective March 31. The lease itself runs through July, but the debtor acknowledged an administrative claim for February and March rent, with the remaining balance to be treated as a general unsecured claim. John Anthony indicated that framework resolved his client's motion, and the court directed the parties to submit an agreed order.
The DIP financing request remains unresolved. The committee asked for additional time to evaluate whether the proposed DIP is necessary or beneficial to the business, and Tiger similarly indicated that it still has significant macro-level concerns and needs more information before taking a position. There was some discussion on timing, and the court ultimately continued both the DIP motion and continued use of cash collateral to March 31 at 9:30 AM so the issues can be addressed together. The U.S. Trustee also noted that the continued 341 meeting is scheduled in two weeks and that preliminary document review is still underway.
Overall, the tone of the hearing was more constructive than prior sessions. While the underlying distrust has not gone away, the combination of weekly reporting, a CRO, and a short continued schedule appears to have created enough structure for the parties to move forward without immediate litigation on every issue.
2. Attendee List
- Judge
- Audrey
- Brian Davis
- Michael Wolff
- Michael Probenzel
- John Anthony
- Jennifer Miranda
- Steven Fox
- Anthony Stumbo
- Jimmy Parish
- Greg Stenman
- Fred Ricupero
3. Action Items
- [Michael Wolff] Prepare and circulate proposed orders covering the agreed cash collateral terms and officer salary resolution before submission to the court.
- [Debtor / Michael Wolff] Provide weekly reporting instead of monthly reporting, in the agreed format.
- [Debtor / Michael Wolff] Provide retroactive reporting back to the February 4 petition date.
- [Debtor / Michael Wolff] Move forward with appointment of a CRO, with fee structure and final engagement details to be finalized.
- [Debtor / Michael Wolff] Provide the committee with the same reporting being provided to Tiger, subject to a confidentiality agreement.
- [Committee / Greg Stenman] Obtain committee approval of the agreements described on the record regarding cash collateral and salary treatment.
- [Tiger / Steven Fox and team] Work with debtor's counsel on final form of agreed orders consistent with the hearing record.
- [Debtor / Michael Wolff] File motion to reject the Four Daughters lease effective March 31.
- [John Anthony] Prepare the agreed order resolving the Four Daughters lease-related motion.
- [Debtor] Include approximately $1,800 in budgeted spend to address erosion/protection needs at the construction site.
- [Committee / Greg Stenman] Continue evaluating the proposed DIP financing and determine whether additional continuance or objection is necessary.
- [U.S. Trustee / Audrey and team] Continue preliminary document review in advance of the continued 341 meeting.
4. Relevant Timelines
- February 4, 2025 - Petition date. Debtor's enhanced reporting must include a retroactive report back to this date.
- Effective as of hearing date - Matt King's compensation reset to an annualized rate of $360,000.
- March 31, 2025 - Target effective date for lease rejection of the Four Daughters property.
- March 31, 2025 at 9:30 AM - Continued hearing on DIP financing and continued use of cash collateral.
- In two weeks from hearing date - Continued 341 meeting, with U.S. Trustee document review still in progress.
- July 2025 - Natural lease termination date for the Four Daughters lease, though debtor intends earlier rejection effective March 31.
5. Additional Notes
- Tiger was explicit that the central issue remains credibility of financial reporting. Their willingness to agree on interim relief is conditional and could reverse quickly if cooperation or transparency falls short.
- The committee echoed that it is still getting up to speed and has not yet completed its own internal approval process on the cash collateral and salary agreements.
- Weekly reporting was treated as a meaningful control point, not just an administrative change. The lenders and committee want visibility early enough to react if performance deteriorates.
- The CRO appointment is emerging as a key governance and oversight mechanism in the case.
- The DIP financing remains a live issue, but there was no sense from the hearing that the court or parties were ready to force that issue immediately. The near-term focus is on information flow, business visibility, and short-term operational control.
- The U.S. Trustee is still in the document review phase, so there may be additional compliance or governance issues raised once that process is further along.