One week ago the market was pricing in a 33% chance that the Fed would keep rates steady and a 67% chance that the Fed would increase rates. After this week’s market data, that expectation got flipped around and now … as you can see here 👇 … the market thinks the Fed is gonna …

What drove the old switcheroo? A couple of things.

First, and foremost, the US nonfarm payrolls report surprised very much to the downside: the US labor market experienced a July contraction, shedding 23k jobs in the face of expected growth.

Wait. But, PETITION, the unemployment rate went down. Yes, that’s true, but so did the labor force participation rate — to the lowest level since February ‘21. You can see which sectors got hit the most 👇:

Labor market softness mixed with the most recent easing of PCE to 3.7% make for a powerful cocktail.*

*****

Which we desperately want to drink.

Johnny reviewed July’s RX action and hot damn it was pathetic. A newly released Pitchbook report highlights why. Check out these charts:

Your eyes aren’t deceiving you: these particular rates are down. LME flow, however, enjoyed a sequential 0.10% uptick in July thanks to System1 Group, SonicWall Holdings, and Medical Solutions all consummating deals.

But even LME activity is depressed. Per Pitchbook:

“Over the past 12 months, 18 index issuers that conducted distressed LMEs contributed to the dual-track default rate, which compares to 37 issuers for the same period last year.”

They add:

“Proportionately speaking, LMEs accounted for 56% of the dual-track default rate at the end of last month, down from a 73% share in July 2025.”

There is a bright side for those of you looking for something more to do than play golf:

“The distress ratio by amount (again, defined as the share of loans trading below 80 cents on the dollar) remains elevated, ticking up to 6.89% in July to mark a sixth straight month above 6.25%. The ratio is nearing the 7.11-7.36% range reached in Q4 2022, which was a period marked by the Federal Reserve’s significant interest rate hikes.”

Of course, a lot of that probably pertains to the recent bloodbath in software so it may be far too early to get excited about any of that. Time will tell.

For now, though, we guess you ought to milk em’ if you got em’:

*****

Speaking of LMEs, let’s dive into some IB earnings below. We also discuss a couple of recent filings, including one that looks like an unmitigated sh*t show. Let’s dig in ⬇️.

*Compounding matters is the fact that Q2 US GDP showed annualized growth at a meager 1.5%, falling 600 bps short of consensus expectations and 600 bps short of Q1 figures. What fed the drag? The US trade deficit is out of f*cking control, primarily. Lower government spending also contributed, both combining to offset AI-based infrastructure spending and the resilient consumer.

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On August 2, 2026, EchoStar Corporation ($ECHO)-owned Hughes Satellite Systems Corporation and eleven affiliates (collectively, the “debtors” and together with their non-debtor subsidiaries, the “company”) filed chapter 11 bankruptcy cases in the Southern District of Texas (Judge Perez).

In case the thought crossed your mind, yes, the ECHO-parented debtors are sister cos. of the “prepackaged” DISH DBS Corporation cases.

In this instance, though, counsel White & Case LLP (“W&C”) dispensed with deigning to tricks us all with any sort of “prepack” label.

Anyway, let’s turn back to the company. It (i) provides broadband internet service to rural communities, (ii) sells enterprise and government services to multinationals and, well, governments, and (iii) designs and manufactures satellite systems and related tech for operators and, again, governments.

On the consumer broadband side, the company has ~641k subscribers as of the petition date, which is … uh … part of a death spiral. A year prior, the company had ~819k, a ~21.7% YOY decline, and there is no coming back. This part of the business is basically a dinosaur because its satellite internet service uses geostationary orbit (“GEOs”) networks hovering about 22.3k miles above the equator. That height comes at a significant cost: latency is huge, about 600ms for round-trip of the signal.

GEO, however, is no longer the only option. Space Exploration Technologies Corp. ($SPCX) (“SpaceX”), Amazon Leo, and “… other operators …” have moved into the market and provide internet access using newer-age, low-earth orbit satellites, which sit at ~210 to ~750 miles above the earth and are, at their absolute apex height, ~3.3% of the GEOs’ total distance. Speeds are therefore substantially faster, and latency isn’t even an issue; it’s about 20 to 40ms, effectively the same as traditional broadband providers. Ergo, consumers have flocked over to the company’s competition, resulting in GEO posting a ~$1.3b loss for FY’25.

⚡️Let’s take a brief tangent here. SPCX reported its Q2’26 earnings earlier this week — its first earnings as a public company — and Starlink is clearly the company’s primary revenue engine. It drove $4.29b of revenue in the quarter, up a staggering 66% YOY. If you’re wondering how that fits into the overall enterprise, Starlink represents 54% of SPCX’s total $7.81b of revenue, far outweighing earnings from 🚀, AI, etc, and is the only profitable business segment. How? Well, the Starlink subscriber base is now 12mm, double what it was last year. Commercial adoption is also soaring, with revenue up 108% YOY to $1.81b. In fact, you may have indirectly noticed this adoption the last time you flew, say, Virgin Atlantic or American Airlines ($AAL). While all of that 👆is obviously impressive, it’s still rough for the likes of GEO to lose to a company that overall is incinerating cash, including, at least thus far in its early tenure, public equity investor cash (though, to be fair, that 👇 stock price is only minimally off the IPO price … it was much farther off just a few days ago … SPCX ripped this week, despite the dreaded lock-up expiration that everyone predicted would sink it farther).⚡️

Ok, now we’re back — and SPCX will be too 👇.

All of the foregoing has the company thinking its future is in the second business segment ☝️, and that’s where 100% of its focus has been placed. A business for which you apparently need a substantially smaller headcount. In late July ‘28, the debtors notified ~400 employees they’d be clocking out for the last time within the next two months.

No doubt that’s upsetting to many of the formerly employed. But you know who also ain’t tickled? The holders of the debtors’ (i) ~$750mm in principal amount senior secured notes (the “secured notes”) and (ii) ~$750mm in principal amount senior unsecured notes (the “unsecured notes”), each of which matured on August 1, 2026 and haven’t been paid back.* The debtors also declined to engage with the noteholders prior to kicking off the chapter 11 cases. They never even bothered to send drafts of customary first day papers.

You know who takes offense to that? Jones Day’s Bruce Bennett, which had Johnny all like:

Legend.

Mr. Bennett and his team represent an ad hoc group of 69%+ of the secured notes and 82%+ of the unsecured notes (the “ad hoc group”), and prior to the petition date, the group was busy. On July 21, 2026, it sent a love letter (😜) to W&C — attached to the cash collateral motion (the “cc motion”) — expressly noting their lack of consent to cash collateral usage and outlining “… claims that the Noteholders have identified thus far, which could generate well in excess of $1.7 billion …” What kind of claims? The letter only scratches the surface, but we’ll skip forward in time — on August 5, 2026, Mr. Bennett dove into more detail … in a motion to appoint an examiner:

“The Jupiter 3 Satellite Lease. In 2023, EchoStar caused Hughes to enter into an above-market lease for EchoStar’s Jupiter 3 satellite (the ‘Satellite Lease’), owned by EchoStar’s subsidiary, EchoStar XXIV, LLC (‘EchoStar XXIV’). This satellite lease became effective in December 2023, triggering approximately $191 million annually in lease payments. At this rate, Hughes will have paid EchoStar XXIV enough in lease payments to fully cover EchoStar XXIV’s cost of constructing the satellite in just over 2.1 years and also paying for the ancillary gross costs of the satellite, such as launch costs, in just three years, despite the satellite having well over a decade of remaining economic useful life …

Cash Dividends. On February 15, 2024, Hughes declared and paid a $529 million cash dividend to EchoStar (the “February Dividend”). The next month, on March 12, 2024, Hughes declared and paid another $500 million cash dividend to EchoStar …

Excessive Tax Payments. In 2024, Hughes paid EchoStar approximately $196 million allegedly related to income taxes. This tax payment to EchoStar was wildly out of line with cash tax payments Hughes reported in the prior three years, where Hughes paid just $4.9 million in 2023, $12.5 million in 2022, and $10.6 million in 2021 … neither Hughes nor EchoStar has disclosed the existence of any tax sharing agreement between them since then that would explain or justify this payment.

Prepayment of Satellite Lease. In March 2024, Hughes prepaid $100 million in EchoStar XXIV satellite lease obligations, and in June 2024 prepaid an additional $85 million, further depleting Hughes’s liquidity for the benefit of an EchoStar subsidiary without any corresponding benefit to Hughes …

The SpaceX Transaction. In September 2025, EchoStar announced an agreement to transfer various spectrum licenses and related assets to SpaceX, including the referral of Hughes’s subscribers to SpaceX in exchange for a referral fee … In addition, it appears from Hughes’s annual report for 2025 that Hughes may also have agreed to transfer certain satellite assets and regulatory authorizations to SpaceX as part of the EchoStar transactions with SpaceX. Publicly filed financial reports do not show the percentage, if any, of the transaction consideration, including SpaceX shares, that have been allocated to Hughes in exchange for its participation in the transaction.”

Who cares about the merits. This is leverage first and foremost, and Mr. Bennett is the 🐐 for making his enemies’ existences a living hell. Not that the motion was limited to those types of claims. Naturally, related fiduciary sh*t followed, especially purported claims against controller shareholder Charles Ergen. We especially liked this bit relating to purported “independent directors” appointed by Mr. Ergen to post facto deal with some of the hair on this dog:

“As professional “independent” directors, each of them fully understands that he will not have any future employment opportunities as “independent” directors if they take any action that is contrary to the wishes of the parties responsible for appointing them. Regardless of the integrity and experience of the individuals expected to serve as “independent” directors, they cannot be considered as truly independent when they are engaged and compensated at the direction of the very persons and entities that are being investigated. There is no reason why the estates should have to bear the risk of relying on an investigation that has even a small chance of infection by bias, corruption or incompetence.”

How dare Mr. Bennett impugn the integrity of the (professional) independent director industry! Suffice it to say, he thinks an examiner who ain’t beholden to Mr. Ergen or the professionals involved here will be a fairer arbiter.

It’s hard to blame Mr. Bennett for taking aggressive action because, jumping back in time, his prior letter fell on deaf ears. Which is not to say he didn’t ramp up shortly thereafter. On July 28, 2026, the ad hoc group also delivered a letter to the court opposing emergency first day relief — W&C attached that one to the cc motion too. Naturally, the group objected to the debtors’ first day relief, couched as an adequate protection beef, as well.

Regardless, the court-letter didn’t stop the first day hearing from pushing forward on August 3, 2026, where Mr. Bennett grilled the debtors’ CRO and FTI Consulting, Inc. ($FCN)’s Robert Del Genio since he’d been in the role for … five minutes? Okay, it’d been five days, a timeframe that similarly extended to the debtors’ independent directors Anthony Horton and FTI-alum Michael Buenzow, who are, you know, very independently performing an investigation with the aid of Kirkland & Ellis LLP.

In any event, it wasn’t much time and Mr. Bennett’s efforts weren’t a waste. For one, he created delay — an achievement in itself; the hearing didn’t end on August 3 and extended ~1.75 hours into the next day. For two, he almost got the debtors to settle … but the parties never got across the finish line. For three, that wasn’t too big a deal — ahead of that second day, the debtors revised the interim cash collateral order to incorporate most of the changes Mr. Bennett had asked for, including removal of the professional fee carveout.

Most importantly, though, the court didn’t just defer to the debtors thereafter: Judge Perez took it a step further on August 4 and kicked the can down the road by requiring the debtors to escrow interest on the notes until the second day hearing (interim order here). The court will catch up to the kicked can at the second day hearing, which is scheduled for August 26, 2026 at 1pm CT — the date on which the court will also take up the examiner motion, 🍿.

The debtors are represented by W&C (Thomas Lauria, David Turetsky, Michael Shepherd, Jason Zakia, Matthew Linder, Roberto Kampfner, Charles Koster, Adam Swingle, Matthew Brown, Fan He) as legal counsel and FCN (Robert Del Genio) as financial advisor and CRO. The debtors’ special committee is composed of Anthony Horton and Michael Buenzow and is represented by Kirkland & Ellis LLP (Patrick Nash, Jr., Matthew Fagen, Ciara Foster, Richard Howell, Ravi Subramanian Sankar, Michael Esser) as legal counsel. The ad hoc group of noteholders is represented by Jones Day (Bruce Bennett, Joshua Mester, Benjamin Sandberg, Oliver Zeltner) as legal counsel. U.S. Bank Trust Company, National Association, as unsecured notes indenture trustee, is represented by Seward & Kissel LLP (John Ashmead, Catherine LoTempio, Shivani Patel) as legal counsel. Customer Delta Air Lines, Inc. ($DAL) is represented by Hughes Hubbard & Reed LLP (Kathryn Coleman, Jeffrey Margolin) as legal counsel.

*The debtors also assert to owe ~$51mm to ECHO, of which $50mm is secured, under intercompany financing arrangements.

Company Professionals:

• Legal: White & Case LLP (Thomas Lauria, David Turetsky, Michael Shepherd, Jason Zakia, Matthew Linder, Roberto Kampfner, Charles Koster, Adam Swingle, Matthew Brown, Fan He)

• Financial Advisor/CRO: FTI Consulting, Inc. ($FCN) (Robert Del Genio)

• Special Committee: Anthony Horton and Michael Buenzow

  • Legal: Kirkland & Ellis LLP (Patrick Nash, Jr., Matthew Fagen, Ciara Foster, Richard Howell, Ravi Subramanian Sankar, Michael Esser)

• Claims Agent: Epiq (Click here for free docket access)

Other Parties in Interest:

• Ad Hoc Group of Holders of Senior Notes

  • Legal: Jones Day (Bruce Bennett, Joshua Mester, Benjamin Sandberg, Oliver Zeltner)

• Secured Notes Indenture Trustee: Wilmington Savings Fund Society, FSB

  • Legal: Pryor Cashman LLP (Seth Lieberman, Patrick Sibley, Andrew Richmond, Daniel Brenner) and Vinson & Elkins LLP (Paul Heath, Kiran Vakamudi, Ariana Erfani, Steven Abramowitz)

• Unsecured Notes Indenture Trustee: U.S. Bank Trust Company, National Association

  • Legal: Seward & Kissel LLP (John Ashmead, Catherine LoTempio, Shivani Patel)

• Customer: Delta Air Lines, Inc.

  • Legal: Hughes Hubbard & Reed LLP (Kathryn Coleman, Jeffrey Margolin)

On July 31, 2026, Naugatuck, CT-based Uniroyal Holding, Inc. (“Uniroyal”) and Great Hill Corporation (“Great Hill” and together with Uniroyal, the “debtors”) filed prepackaged chapter 11 bankruptcy cases in the District of New Jersey (Judge Kaplan). The debtors are … um … well, they don’t have any business operations. Uniroyal was incorporated back in ‘85 as part of a corporate reorganization of its direct parent Uniroyal, Inc. (“Inc”), and while it initially owned 50% of the equity in a tire and rubber op, Uniroyal sold its stake in ‘90 to Michelin. It hasn’t owned a real biz since.*

Instead, since the sale, its only purpose has been to (i) provide post-employment benefits — e.g., medical and life insurance benefits — to retirees of Uniroyal and Inc’s discontinued businesses and (ii) manage litigation, mainly personal injury and wrongful death claims related to pre-1976 asbestos manufacturing (the “PI/WD claims”).

Benefits aren’t really an issue any longer either. Seeing annual costs rising year in, year out, in the ‘90s, Uniroyal kicked over, with retiree consent, those obligations and assets to fund ‘em to four voluntary employee beneficiary associations (“VEBAs”), which put them out of the reach of any other creditor. Plus, you know, time is the king of men. In ‘26, there are only 140 retirees alive and their average age is 92.

Which leaves the PI/WD claims as the root cause of the filing. For the background, here’s long-time debtor employee and president Robert D’Angelo, Jr.:

“For the last 40 years, Uniroyal has successfully settled or defended claims against it and managed its liabilities, but the sheer number of asserted litigation claims is massive and will quickly become unmanageable upon retirement of the current Uniroyal employee team that has actively directed and coordinated this effort. Since Uniroyal’s formation more than 40 years ago, 516,656 PI/WD Claims have been filed against it.”

Sure as sh*t, that was expensive. Back to Mr. D’Angelo:

“Uniroyal has resolved and made payments of just under $500 million for 216,994 of those cases. 264,232 of those claims were dismissed without payment, leaving a total of over 35,000 pending cases. Uniroyal has paid an additional amount of $160 million in defense costs.”

… and after 35+ years of that primary work …

… the debtors’ three full-time employees — all between 69 to 73 — are, unlike 99% of the senior folk in the RX industry, ready to retire. Can you blame them? Can you imagine spending decades — literal decades — of your life doing nothing but managing asbestos claims. Holy f*cking hell.

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There’ve been a lot of problems lately at the pool.

Not that one.

We mean Leslie’s, Inc. ($LESL)(“Leslie’s” or the “company”), the AZ-based pool supplies retailer that has also been desperately attempting repairs and which we’ve covered quite extensively here, here, and, most recently, here.

The company was seemingly starting to turn things around; it hit its (revised) targets for FY25 (ended 10/4/25), halted margin erosion over the last four quarters, and even returned to growth on the top line in 2Q26 (more on that below). The stock recovered sufficiently for NASDAQ to declare the company was back in compliance with its listing requirements.

Then, on July 22, 2026, Bloomberg dropped this article:

This headline was a bit misleading. Dig into the actual article — something a lot of people don’t seem to do anymore — and you’d note that it reported how Leslie’s “…is considering a range of strategic options to address its debt load, including a potential Chapter 11 bankruptcy filing” and the “…company has been holding confidential discussions with creditors to extend its debt,” according to unidentified sources. It went on:

“While the company has weighed a Chapter 11 filing, discussions are ongoing and no final decision has been made, the people said. Given the firm is in the peak summer season, its recent performance will have some sway on its path forward, some of the people said.”

The company has not commented on the story, but it is not out of step with what CEO Jason McDonnell had to say on the 2Q26 earnings call back in May:

“We continue to evaluate capital structure opportunities and are actively working with our incumbent lenders as well as third party capital providers to finance a series of incremental initiatives that could further accelerate our growth and shorten the path to profitability.”

Aren’t we all, in some way, always considering a bankruptcy filing? Or is that just us?

Still, the article caused the stock, which had recovered so valiantly in the two months since the last earnings report, to take a … dive. It fell from over $10 a share back below $1, giving up all the gains it had made since the relatively positive 2Q earnings report. While it has recovered a little bit, this demonstrates the brutality 👇:

As we noted above, Leslie’s operating performance through the first half of FY26 (ended March) offered early signs that the turnaround was starting to take hold. Leslie’s turnaround strategy seemingly includes anything and everything they and their advisors could think of: adjusting pricing strategy, targeting lapsed customers, closing underperforming stores and consolidating its footprint, altering store compensation structures, and optimizing inventory spend.

In 2Q26 (ended March) revenue ⬆️ 4.3% despite significant store closures. Same store sales ⬆️ by 6.6%, making it the first quarter of meaningful same store sales growth since ’22. 2Q26 Adj. EBITDA was negative, as is typical for the company in the first half of the year leading up to “pool season,” but losses narrowed to ($27mm) vs. ($36mm) in the prior year. Lower occupancy, labor, and other store operating expenses, as well as improved operating leverage and more favorable product mix, all contributed to improve Adj. EBITDA margins.

As you can see in the quarterly numbers above, the company generates more than 70% of revenue and all its positive Adj. EBITDA in the second half of year, so the more critical earnings reports are yet to come. However, the company reaffirmed its full year guidance in conjunction with its 2Q26 earnings. On an LTM basis, it is tracking ahead of the midpoint for revenue and forecasting more margin recovery in the back half of the year.

Leslie’s ended 2Q26 with $17mm of cash and $97mm available under its $250mm ABL revolver. The company drew down $25mm on the ABL Revolver in 1Q26 and a further $74mm in 2Q26, bringing the total draw up to $99mm and total leverage north of 14x. These draws follow the company’s usual pattern of drawing down on its revolver during 1H to prepare for the peak season and then paying it off in full in the back half of its fiscal year.

The ABL revolver bears interest at S+125-175 and is due three months inside of the company’s term loan due March ’28. The senior secured term loan (S+250-275) due March ’28 has $757mm outstanding and is pricing deep in distressed territory (~38c as of August 3, 2026).

The company has not yet set a date for its 3Q26 earnings report, but last year released preliminary 3Q results on July 28, 2025 and full results on August 6, 2025. We look forward to skewering reviewing them.

⚡️Update: Verra Mobility Corp. ($VRRM)⚡️

Management over at Mesa, Arizona-based Verra Mobility Corp. ($VRRM)(“Verra” or the “company”) must’ve been like “holy hell, we made PETITION, we’d better get our sh*t together.”

And so a mere nine days after we wrote about the hot mess that transpired after Avis Budget Group ($CAR)(“Avis”) said …

… and terminated its commercial services contract with the company — decimating the company’s stock by 70%(!) — the company dropped this bit of news to calm markets:

And … like … it … kinda worked … ? Take a look 👇:

That’s what you call a healthy ~44.5% bump, y’all. But there’s still quite a long way to go to get back to where it was before the initial announcement.

The company’s Q2’26 earnings release will be later today, August 5, 2026 after market close.

Management will have a lot of ‘splainin to do.

💥New Chapter 11 Bankruptcy Filing - ASP Unifrax Holdings Inc. (Alkegen)💥

On July 26, 2026, Irving, TX-based, Clearlake Capital Group, L.P. (“Clearlake”)-owned ASP Unifrax Holdings Inc. and sixty-two affiliates (collectively, the “debtors” and together with their non-debtor subsidiaries, the “company”) filed previously-announced prepackaged chapter 11 bankruptcy cases in the Northern District of Texas (Judge Everett), which, if we can be honest here, look to be set up to be pretty damn 🍿-free. We are not complaining.

Anyway, the company manufactures thermal management, filtration, emissions control, and battery fire protection “solutions” — think blast furnaces, catalytic furnace linings, exhaust systems — and is the result of Clearlake’s ‘18 acquisition of Unifrax LLC, which in turn acquired Lydall, Inc. in September ‘21 and created the company as it exists today.

It’s a big operation: 3.9k employees, 23 countries, excluding the debtors’ stake in the non-debtor, China-based Luyang Energy-Savings Materials Co. Ltd. (”Luyang”).

The company has two primary divisions: (i) the industrial solutions group, which as the name suggests, is focused on industrial applications and accounted for $636mm, or 64%, of the company’s ‘25 revenue; and (ii) the mobility solutions group, which homes in on the automobile industry, came in at $267mm, or 27%, for the same period.*

Like basically every industrial debtor, the debtors blame the bankruptcy on “… macroeconomic crosscurrents and market-specific pricing pressures …” In other words, interest rates are ⬆️, supply overcapacity is ⬆️, and market share is therefore ⬇️.** In addition, growth initiatives were underwhelming — could there be a root cause lying in CEO and Alvarez & Marsal LLC’s Brian Whittman’s first day dec? Let’s see what he says:

“Alkegen’s highly leveraged capital structure at times led to a focus on higher impact activities with more difficult execution, while under-investing in the core business.”

LOL, holy hell, that’s one of the best commentaries on the virtues of liability management exercises Johnny has ever seen — which happened in ‘24 when the company stepped into this bloated a$$ debt stack:

Mr. Whittman, though, can thank that bloat for his gig. Bob Caruso, the company’s chief restructuring transformation officer, can too. In October ‘25, the company showed prior management the door and brought them on “… to support a comprehensive review of the business, develop a 2026 budget and long-range business plan, and identify and implement a series of performance improvement initiatives,” which, in 1Q26, roped in the next workstream. That is, formulating a deal with an ad hoc group of debt holders (the “ad hoc group”) repped by Davis Polk & Wardwell LLP (“DPW”) and PJT Partners LP (“PJT”). Naturally, a special committee also integrated itself into the mix. That’s composed of David Ford and Todd Arden.

In any event, after a few months of trading term sheets, a deal emerged among the company, the ad hoc group, and Clearlake, which is embodied in a July 19, 2026 restructuring support agreement (the “RSA”). The RSA, as well as the related chapter 11 plan and disclosure statement (the “DS”), is supported by holders of (i) ~99% of 1L claims, (ii) ~80% of 2L claims, (iii) ~95% of the company’s pref A stock, and (iv) ~99% of its senior common stock*** and provides:

📍DIP Facility. A $630mm DIP loan composed of (a) $315mm in new money term loans and notes ($265mm interim) and (b) a $315 million roll-up of the DIP lenders’ 1L term loans and notes (also $265mm interim), which will be used to refinance the prepetition revolver in full. The DIP bears interest at SOFR + 8.375%, with up to 50% PIK, and includes a 5% backstop fee payable in net (discount from the funded proceeds) or cash to the ad hoc group members backstopping the DIP, a 2.5% upfront fee payable by netting, and a 2.25% exit fee.

📍Equity Rights Offering. An up-to $335mm equity rights offering (the “ERO”), which will be offered to 1L holders, for 59% of the reorg equity, subject to dilution by any MIP, and which is also backstopped by members of the ad hoc group. For the backstopping, they will straight-up receive 3% of the reorg equity (the “ERO fee”) under the plan.

📍Treatment of Claims. The plan provides a comprehensive restructuring. 1Ls will receive that right immediately ☝️, as well as $85mm in exit term loans and 100% of the reorg equity prior to giving effect to the ERO, the MIP, the ERO fee, and the junior funded debt recovery … which provides that all other funded debt claims, including 1L deficiency claims, will receive (i) five-year warrants to purchase 5% of the reorg equity at a ~$2b strike price and (ii) 1% of the reorg equity, subject to dilution by the MIP and the new warrants, but not the ERO or the ERO fee. Finally, the big one: GUCs. Imagine our delight when we saw this prepack did the typical prepack thing — it passes GUCs through entirely unimpaired. If there’s an official committee of unsecured creditors in the cases, we can’t imagine them complaining. Clearlake, as equity sponsor, will also receive the customary treatment — cancellation in full of its equity interests.

📍Exit Term Loan. To get out of bankruptcy, there’s a pre-baked $400mm term loan that’ll be put to use by refinancing the DIP and giving the 1Ls’ their $85mm in take-back debt.

📍Timeline. It’s fast. Obviously.

Will anyone have any issues with the pace? GUCs aren’t hurt, and the deleveraging is massive …

… so we reckon ‘no’.

The court held the first day hearing on July 28, 2026. Unfortunately, the audio isn’t available, but we imagine there was a lot of hand-holding and back-patting. Regardless, the court granted all requested relief and scheduled (i) the second day hearing for August 25, 2026 at 9:30am CT and (ii) the combined hearing on confirmation of the plan and final approval of the DS for September 3, 2026 at 10:30am CT.

The debtors are represented by Kirkland & Ellis LLP (Anup Sathy, Steven Serajeddini, Nicholas Adzima, Margaret Reiney) and Gray Reed (Jason Brookner, Lydia Webb, Emily Shanks) as legal counsel, Alvarez & Marsal LLC (Brian Whittman, Bob Caruso, Doug Donoghue) as financial advisor, CEO, and CTO, Centerview Partners LLC (Robert Beasley) as investment banker, and C Street Advisory Group as strategic communications advisor. Todd Arden and David Ford are the debtors’ independent directors and compose its special committee, which is represented by Katten Muchin Rosenman LLP (Steven Reisman, Marc Roitman, Robert Smith, Michael Rosella, Michaela Croker) as legal counsel. The ad hoc group is represented by DPW (Damian Schaible, Angela Libby, Jarret Erickson, Jacob Goldberger) and Haynes and Boone, LLP (Ian Peck, Jordan Chavez, Kelli Norfleet, David Trausch) as legal counsel and PJT Partners LP as investment banker. Wilmington Savings Fund Society FSB, as DIP agent and 1L collateral agent, is represented by Seward & Kissel LLP (John Ashmead, Gregg Bateman, Catherine LoTempio) and Blank Rome LLP (Buffey Klein, Jordan Williams) as legal counsel. JPMorgan Chase Bank NA, as the 1L admin agent, is represented by Paul Hastings LLP (Matthew Warren, Charles Persons, William Reily) as legal counsel. Wilmington Trust NA, as the indenture trustee under the debtors’ senior unsecured notes, is represented by Kelley Drye & Warren LLP (James Carr, Kristin Elliott, Andrew Matott, Jennifer Provenzano) as legal counsel.

*The company’s industrial filtration group — felt-based filtration materials for industrial waste gases — rounded up the last 9% ($88mm in revenue). It also has a start-up business business in the lithium-ion battery-space, which hasn’t yet reached commercialization.

**For a point of reference, Luyang’s sales fell by $141 million in ‘25, leading to a decrease in adjusted EBITDA of 50%+.

***The “vast majority” of the company’s stock is held by Clearlake entities.

📚Resources📚

There’s a lot of jittery market activity out there so you’ll have to forgive us for having market dysfunction on our minds. As you know, we’ve had a long-standing list of a$$-kicking resources on the topics of restructuring, tech, finance, investing, and disruption which, in case you forgot,💥you can find here💥. We do occasionally update it and this week you’ll now find a number of titles we’ve been dabbling in related to financial bubbles/crises. Take a look and read until your heart’s discontent.

📤 Notice📤

Kristine Manoukian (Partner) joined DLA Piper LLP from McDermott Will & Schulte LLP.

Kyle Trevett (Associate) joined Debevoise & Plimpton LLP from Kirkland & Ellis LLP.

Nicholas Dunstone (Partner) joined Jones Day from Milbank LLP.

(Former Judge) Robert Drain (Senor Advisor & Head of Fiduciary Services) joined M3 Advisory Partners LP from Skadden.

🍾Congratulations to…🍾

Darryl Myers on his promotion to Managing Director at BDO USA.

Matt Rahmani on his promotion to Partner at Perella Weinberg Partners.

Willkie Farr & Gallagher LLP (James Burbage, Hon. Shelley Chapman (Ret.), Brett Miller, Jennifer Hardy) for securing the legal mandate on behalf of the official committee of unsecured creditors in the Camp Mystic LLC chapter 11 bankruptcy cases.

NOTE: do you have exciting news to share? Feel free to email us — especially if you’re a firm administrator — with any and all personnel news at petition@petition11.com.

💰New Opportunities💰

PETITION is looking for MBA and JD candidates to work with us as paid interns. This is primarily a research and writing position for up to 10-20 hours a week that will give awesome exposure to the worlds of distressed investing, bankruptcy and restructuring. Work is remote. If interested, email us your resume at petition@petition11.com with the subject line “Internship” and we’ll be happy to answer questions. Cheers.

*****

PETITION is also seeking a freelance social media manager to give life to PETITION’s accounts on Instagram and potentially other platforms. The ideal candidate has experience managing social for a media brand or creator, is fluent in Canva and/or Illustrator, can adapt newsletter content into sharp, on-brand social posts (feed, stories, reels), and understands and enjoys financial storytelling. If you’re interested or know someone who could be a great fit, please send your/their portfolio, relevant social handles, and a short note about your/their availability to petition@petition11.com.

On July 26, 2026, Irving, TX-based, Clearlake Capital Group, L.P. (“Clearlake”)-owned ASP Unifrax Holdings Inc. and sixty-two affiliates (collectively, the “debtors” and together with their non-debtor subsidiaries, the “company”) filed previously-announced prepackaged chapter 11 bankruptcy cases in the Northern District of Texas (Judge Everett), which, if we can be honest here, look to be set up to be pretty damn 🍿-free. We are not complaining.

Anyway, the company manufactures thermal management, filtration, emissions control, and battery fire protection “solutions” — think blast furnaces, catalytic furnace linings, exhaust systems — and is the result of Clearlake’s ‘18 acquisition of Unifrax LLC, which in turn acquired Lydall, Inc. in September ‘21 and created the company as it exists today.

It’s a big operation: 3.9k employees, 23 countries, excluding the debtors’ stake in the non-debtor, China-based Luyang Energy-Savings Materials Co. Ltd. ("Luyang”).

The company has two primary divisions: (i) the industrial solutions group, which as the name suggests, is focused on industrial applications and accounted for $636mm, or 64%, of the company’s ‘25 revenue; and (ii) the mobility solutions group, which homes in on the automobile industry, came in at $267mm, or 27%, for the same period.*

Like basically every industrial debtor, the debtors blame the bankruptcy on “… macroeconomic crosscurrents and market-specific pricing pressures …” In other words, interest rates are ⬆️, supply overcapacity is ⬆️, and market share is therefore ⬇️.** In addition, growth initiatives were underwhelming — could there be a root cause lying in CEO and Alvarez & Marsal LLC’s Brian Whittman’s first day dec? Let’s see what he says:

“Alkegen’s highly leveraged capital structure at times led to a focus on higher impact activities with more difficult execution, while under-investing in the core business.”

LOL, holy hell, that’s one of the best commentaries on the virtues of liability management exercises Johnny has ever seen — which happened in ‘24 when the company stepped into this bloated a$$ debt stack:

Mr. Whittman, though, can thank that bloat for his gig. Bob Caruso, the company’s chief restructuring transformation officer, can too. In October ‘25, the company showed prior management the door and brought them on “… to support a comprehensive review of the business, develop a 2026 budget and long-range business plan, and identify and implement a series of performance improvement initiatives,” which, in 1Q26, roped in the next workstream. That is, formulating a deal with an ad hoc group of debt holders (the “ad hoc group”) repped by Davis Polk & Wardwell LLP (“DPW”) and PJT Partners LP (“PJT”). Naturally, a special committee also integrated itself into the mix. That’s composed of David Ford and Todd Arden.

In any event, after a few months of trading term sheets, a deal emerged among the company, the ad hoc group, and Clearlake, which is embodied in a July 19, 2026 restructuring support agreement (the “RSA”). The RSA, as well as the related chapter 11 plan and disclosure statement (the “DS”), is supported by holders of (i) ~99% of 1L claims, (ii) ~80% of 2L claims, (iii) ~95% of the company’s pref A stock, and (iv) ~99% of its senior common stock*** and provides:

📍DIP Facility. A $630mm DIP loan composed of (a) $315mm in new money term loans and notes ($265mm interim) and (b) a $315 million roll-up of the DIP lenders’ 1L term loans and notes (also $265mm interim), which will be used to refinance the prepetition revolver in full. The DIP bears interest at SOFR + 8.375%, with up to 50% PIK, and includes a 5% backstop fee payable in net (discount from the funded proceeds) or cash to the ad hoc group members backstopping the DIP, a 2.5% upfront fee payable by netting, and a 2.25% exit fee.

📍Equity Rights Offering. An up-to $335mm equity rights offering (the “ERO”), which will be offered to 1L holders, for 59% of the reorg equity, subject to dilution by any MIP, and which is also backstopped by members of the ad hoc group. For the backstopping, they will straight-up receive 3% of the reorg equity (the “ERO fee”) under the plan.

📍Treatment of Claims. The plan provides a comprehensive restructuring. 1Ls will receive that right immediately ☝️, as well as $85mm in exit term loans and 100% of the reorg equity prior to giving effect to the ERO, the MIP, the ERO fee, and the junior funded debt recovery … which provides that all other funded debt claims, including 1L deficiency claims, will receive (i) five-year warrants to purchase 5% of the reorg equity at a ~$2b strike price and (ii) 1% of the reorg equity, subject to dilution by the MIP and the new warrants, but not the ERO or the ERO fee. Finally, the big one: GUCs. Imagine our delight when we saw this prepack did the typical prepack thing — it passes GUCs through entirely unimpaired. If there’s an official committee of unsecured creditors in the cases, we can’t imagine them complaining. Clearlake, as equity sponsor, will also receive the customary treatment — cancellation in full of its equity interests.

📍Exit Term Loan. To get out of bankruptcy, there’s a pre-baked $400mm term loan that’ll be put to use by refinancing the DIP and giving the 1Ls’ their $85mm in take-back debt.

📍Timeline. It’s fast. Obviously.

Will anyone have any issues with the pace? GUCs aren’t hurt, and the deleveraging is massive …

… so we reckon ‘no’.

The court held the first day hearing on July 28, 2026. Unfortunately, the audio isn’t available, but we imagine there was a lot of hand-holding and back-patting. Regardless, the court granted all requested relief and scheduled (i) the second day hearing for August 25, 2026 at 9:30am CT and (ii) the combined hearing on confirmation of the plan and final approval of the DS for September 3, 2026 at 10:30am CT.

The debtors are represented by Kirkland & Ellis LLP (Anup Sathy, Steven Serajeddini, Nicholas Adzima, Margaret Reiney) and Gray Reed (Jason Brookner, Lydia Webb, Emily Shanks) as legal counsel, Alvarez & Marsal LLC (Brian Whittman, Bob Caruso, Doug Donoghue) as financial advisor, CEO, and CTO, Centerview Partners LLC (Robert Beasley) as investment banker, and C Street Advisory Group as strategic communications advisor. Todd Arden and David Ford are the debtors’ independent directors and compose its special committee, which is represented by Katten Muchin Rosenman LLP (Steven Reisman, Marc Roitman, Robert Smith, Michael Rosella, Michaela Croker) as legal counsel. The ad hoc group is represented by DPW (Damian Schaible, Angela Libby, Jarret Erickson, Jacob Goldberger) and Haynes and Boone, LLP (Ian Peck, Jordan Chavez, Kelli Norfleet, David Trausch) as legal counsel and PJT Partners LP as investment banker. Wilmington Savings Fund Society FSB, as DIP agent and 1L collateral agent, is represented by Seward & Kissel LLP (John Ashmead, Gregg Bateman, Catherine LoTempio) and Blank Rome LLP (Buffey Klein, Jordan Williams) as legal counsel. JPMorgan Chase Bank NA, as the 1L admin agent, is represented by Paul Hastings LLP (Matthew Warren, Charles Persons, William Reily) as legal counsel. Wilmington Trust NA, as the indenture trustee under the debtors’ senior unsecured notes, is represented by Kelley Drye & Warren LLP (James Carr, Kristin Elliott, Andrew Matott, Jennifer Provenzano) as legal counsel.

*The company’s industrial filtration group — felt-based filtration materials for industrial waste gases — rounded up the last 9% ($88mm in revenue). It also has a start-up business business in the lithium-ion battery-space, which hasn’t yet reached commercialization.

**For a point of reference, Luyang’s sales fell by $141 million in ‘25, leading to a decrease in adjusted EBITDA of 50%+.

***The “vast majority” of the company’s stock is held by Clearlake entities.

Company Professionals:

• Legal: Kirkland & Ellis LLP (Anup Sathy, Steven Serajeddini, Nicholas Adzima, Margaret Reiney) and Gray Reed (Jason Brookner, Lydia Webb, Emily Shanks)

• Financial Advisor/CEO/CTO: Alvarez & Marsal LLC (Brian Whittman, Bob Caruso, Doug Donoghue)

• Investment Banker: Centerview Partners LLC (Robert Beasley)

• Strategic Communications Advisor: C Street Advisory Group

• Disinterested Directors: Todd Arden, David Ford

  • Legal to Special Committees: Katten Muchin Rosenman LLP (Steven Reisman, Marc Roitman, Robert Smith, Michael Rosella, Michaela Croker)

• Claims Agent: (Click here for free docket access)

Other Parties in Interest:

• Ad Hoc Group of Lenders

  • Legal: Davis Polk & Wardwell LLP (Damian Schaible, Angela Libby, Jarret Erickson, Jacob Goldberger) and Haynes and Boone, LLP (Ian Peck, Jordan Chavez, Kelli Norfleet, David Trausch)

  • Investment Banker: PJT Partners LP

• DIP Agent and 1L Collateral Agent: Wilmington Savings Fund Society FSB

  • Legal: Seward & Kissel LLP (John Ashmead, Gregg Bateman, Catherine LoTempio) and Blank Rome LLP (Buffey Klein, Jordan Williams)

• 1L Admin Agent: JPMorgan Chase Bank NA

  • Legal: Paul Hastings LLP (Matthew Warren, Charles Persons, William Reily)

• Indenture Trustee under the 7.5% senior unsecured notes due ‘29: Wilmington Trust NA

  • Legal: Kelley Drye & Warren LLP (James Carr, Kristin Elliott, Andrew Matott, Jennifer Provenzano)

• Sponsor: Clearlake Capital Group LP

⚡️Update 1: JELD-WEN Holding, Inc. ($JELD)⚡️

Since we last covered North Carolina-based window and door maker JELD-WEN Holding, Inc. ($JELD)(“JELD-WEN” or the “company”) back in March …

… when the stock was down ~21% YTD. Since then, the stock has been a roller coaster of ups and down and now sits meaningfully below its March ’26 value.

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⚡️Update 1: America’s Car-Mart Inc. ($CRMT)⚡️

Barely a month ago, we wrote about Arkansas-based America’s Car-Mart Inc. ($CRMT)(“Car-Mart” or the “company”). As a reminder, the company sells and finances very used cars to very subprime buyers; it had historically done so without tapping credit markets, but couldn’t resist turning to the securitization market to fuel growth during the headiest days of the ’20-’21 used car boom. You can revisit our prior coverage here👇:

Luckily for those of us starved of interesting (potential) restructurings to follow, the company is back with its 4Q26 (ended April) earnings report and an update on its negotiations with lenders, who have been generously granting the company forbearance since June 1, 2026.

First, the quarter. Revenue ⬇️ 18% YOY to $303mm, with sales volumes ⬇️ 27% YOY. According to the company, the declines don’t reflect lower underlying demand; rather, declines are the natural consequence of the company having fewer cars to sell and fewer places to sell them after Car-Mart slashed inventory purchases and closed 30% of its dealerships during the quarter to preserve cash.

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🔗New Chapter 11 Bankruptcy Filing - Poolin Technology PTE LTD🔗

Back on July 22, 2026, Poolin Technology PTE LTD (“Poolin”) and two affiliates, Lonestar Taproot LLC (“LT”) and Lonestar Dream Inc. (“LD,” and together with LT and Poolin, the “debtors”) filed chapter 11 bankruptcy sale cases in the District of New Jersey (Judge O’Hagan). While LT and LD are DE entities, Poolin is a private limited company registered in Singapore; it operated in China through affiliated operating entities, primarily in the business of providing crypto mining pool, wallet, and related blockchain infrastructure services. By September ‘19, it was, at least according to the first day declaration of proposed CRO/FA/IB Michael DuFrayne of DuFrayne LLC, “…the largest crypto mining pool in the world.”

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💥New Chapter 11 Bankruptcy Filing - CashCall, Inc.💥

The facts of this case are … um … unique.

On July 20, 2026, La Jolla, CA-based CashCall, Inc. (the “debtor”) filed a chapter 11 bankruptcy case in the Southern District of California (Judge Marum). Founded in ‘03, the debtor’s business is providing unsecured personal loans to people with poor credit history. Or was, it originated its last loans in March ‘26 and fired its last employee in June ‘26, down from a high of ~1.1k.

Anyway, we’re talking poor credit here, so clearly the loans were uber expensive and default rates were high. Like, holy sh*t were they expensive. Here’s J. Paul Reddam, the debtor’s founder, sole shareholder, and CEO:

“Initially, the Debtor offered $10,000 loans at 24%-39% interest … To broaden its market, the Debtor began to offer additional loan products, including $5,000 loans at interest rates of 47%-59%, and starting in late 2004, a loan of $2,600 at a 79% interest rate and maximum term of 42 months …

To maintain profitability on these risky loans (default rates exceeded 45%), the Debtor eventually raised interest rates to 96%. While the Debtor targeted 15%-20% profits on the $2,600, it was only ever able to achieve about 7-8% profit…

However, as default rates spiked in the wake of the 2008 recession, the Debtor was forced to raise interest rates on its $2,600 loans to up to 135% by July 2009. During this time, the default rate on loans made by the Debtor exceeded 50%.”

The cases flow from those rates and loan-structuring. There has been mucho litigation:

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💥New Chapter 11 Bankruptcy Filing - Alea Holdings US Company💥

On July 19, 2026, Hartford CT-based, Catalina Re-owned Alea Holdings US Company, Alea Group Holdings (Bermuda) Ltd. and venue-providing TX-LLC, FIN Alea LLC, (collectively, the “debtors” and together with two non-debtor entities, the “company”) filed prepackaged (for real) bankruptcy cases in the Southern District of Texas (Judge Lopez). The debtors’ business is — try to stay awake here — to “… oversee their non-Debtor insurance subsidiaries … in their performance of a wide variety of activities, including establishing reserves, negotiating settlements, paying outstanding insurance claims, and managing regulatory and capital requirements,” 😴. The ones on the bottom of this chart 👇:

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📚PETITION’s A$$-Kicking Resources📚

There’s a lot of jittery market activity out there so you’ll have to forgive us for having market dysfunction on our minds. As you know, we’ve had a long-standing list of a$$-kicking resources on the topics of restructuring, tech, finance, investing, and disruption which, in case you forgot,💥you can find here💥. We do occasionally update it and this week you’ll now find a number of titles we’ve been dabbling in related to financial bubbles/crises. Take a look and read until your heart’s discontent.

That was a long time ago. Things have changed. For its part, Poolin is kaput. LD was formed later to house two mining sites in Texas. Powering those sites, however, proved to be a challenge and the debtors lost a whole lot of millions on them. They’ve since been wound down, but LD still owns the sites. LT performed integrated business functions with respect to the mining sites … whatever the hell that means … and it owns some sh*t (~$41.7mm worth). We’d attempt to dig in more to the papers but … truthfully? … we don’t give a f*ck … these cases reek. Cutting to the chase, there’s a stalking horse (Thor CALAP LLC) for one of the mining sites and certain of the debtors’ assets but the total, split between two discreet sales, is $52mm.*

The problem here is that there’s debt — the largest portion of which (~$163.7mm) is unsecured IOUs owed to a whole bunch of foreigners who trusted Poolin for their crypto needs. There’s other stuff too bringing the total nut to over $170mm. In short/conclusion, a lot of people gonna get a good ol’ fashioned international f*cking here.

The debtors are represented by Archer & Greiner PC (Stephen Packman, Alexander Andrews, Doug Leney, Natasha Songonuga) as legal counsel and the aforementioned DuFrayne LLC (Michael DuFrayne) as CRO, financial advisor, and investment banker. Thor CALAP LLC is represented by Wachtel Missry LLP (Jason Libou, Steven Cohen).

*A bid procedures motion is already on file.

Company Professionals:

• Legal: Archer & Greiner PC (Stephen Packman, Alexander Andrews, Doug Leney, Natasha Songonuga)

• Financial Advisor/CRO & Investment Banker: DuFrayne LLC (Michael DuFrayne)

• Claims Agent: Verita (Click here for free docket access)

Other Parties in Interest:

• Stalking Horse Purchaser: Thor CALAP LLC

  • Legal: Wachtel Missry LLP (Jason Libou, Steven Cohen)

The facts of this case are … um … unique.

On July 20, 2026, La Jolla, CA-based CashCall, Inc. (the “debtor”) filed a chapter 11 bankruptcy case in the Southern District of California (Judge Marum). Founded in ‘03, the debtor’s business is providing unsecured personal loans to people with poor credit history. Or was, it originated its last loans in March ‘26 and fired its last employee in June ‘26, down from a high of ~1.1k.

Anyway, we’re talking poor credit here, so clearly the loans were uber expensive and default rates were high. Like, holy sh*t were they expensive. Here’s J. Paul Reddam, the debtor’s founder, sole shareholder, and CEO:

“Initially, the Debtor offered $10,000 loans at 24%-39% interest … To broaden its market, the Debtor began to offer additional loan products, including $5,000 loans at interest rates of 47%-59%, and starting in late 2004, a loan of $2,600 at a 79% interest rate and maximum term of 42 months …

To maintain profitability on these risky loans (default rates exceeded 45%), the Debtor eventually raised interest rates to 96%. While the Debtor targeted 15%-20% profits on the $2,600, it was only ever able to achieve about 7-8% profit…

However, as default rates spiked in the wake of the 2008 recession, the Debtor was forced to raise interest rates on its $2,600 loans to up to 135% by July 2009. During this time, the default rate on loans made by the Debtor exceeded 50%.”

The cases flow from those rates and loan-structuring. There has been mucho litigation:

📍In July ‘08, a putative class filed a case against the debtor alleging those rates ☝️, although not then-capped by state law,* were “… unconscionable,” which over the course of fifteen years round its way through California state and federal courts before the state court certified a class of “… 119,844 class members …” encompassing “ … 133,848 loans …” and ordered the debtor to pay ~$245.5mm in restitution, which was held up on appeal in February ‘26.

📍In December ‘13, the Consumer Financial Protection Bureau (the “CFPB”) sued the debtor and Mr. Reddam, arguing that one of the debtor’s lending models — under which it effectively routed loans through sovereign tribal lands — was very much no bueno. Despite the debtor having obtained the advice of legal counsel in orchestrating the structure, the CFPB was determined to have been right. After appeals and subsequent remands in that lawsuit, the district court entered judgment in favor of the CFPB and imposed a $33mm civil penalty and $134mm in restitution, offset by $10mm for an earlier payment made during the course of the case. The debtor also appealed that, but the Ninth Circuit affirmed in April ‘25 and the Supreme Court closed the door in March ‘26.

📍Which brings us back to that advice of counsel. It created two more suits. In ‘17, the debtor filed a malpractice suit against its former counsel, which settled in ‘21. However, the debtor is organized as an S-corp. and therefore doesn’t pay any direct income taxes. Instead, they flow up to Mr. Reddam, who needed and was provided a chunk of change to kick over what was owed to Uncle Sam. That’s where the second suit comes in: one of the class reps didn’t like the upstreaming from the debtor and sued to claw it back in August ‘24. Mr. Reddam and the debtor filed motions for summary judgment, but a week before the bankruptcy, the court ruled against each.

Ergo, the bankruptcy, which, among other things, placed the clawback action in the hands of the estate, where it represents, by far, the largest asset. It’s worth upwards of $45mm, and the second largest asset is a ~$1.5mm loan portfolio.

At this point, you might be thinking, “yeah, but there’s no way the debtor will sue its owner, founder, and CEO for the cash …” to which it replies:

Seeing that its business didn’t work any more, in 2Q26, the debtor brought on Manatt, Phelps & Phillips, LLP (Patrick DuBois, Schuyler Carroll) and Dundon Advisers, LLC (Matthew Dundon) as advisors and installed Craig Jalbert as an independent director. Sometime between then and the petition date, the debtor also rung up Leslie Gladstone (of Financial Law Group) to serve as CRO, and those folks are fully in control of the cases and intend to pursue the action against Mr. Reddam.

Who, to his credit, still isn’t walking away from the business. Through Absolutely Zero Corporation (“AZC”), Mr. Reddam tried to supply the debtor with a $3.995mm DIP ($1.3mm interim) on unbelievable terms. Interest is at SOFR plus … well … nothing. Just SOFR. There’s also zero fees and zero releases.

Buuuuuuuuttttt it does include a lien on all estate causes of action, which pissed off the US Trustee (the “UST”) and the CFPB. As we noted above, the debtor isn’t operating any more and doesn’t have any employees, so in their view, it doesn’t need any cash, let alone an insider DIP. Moreover, the UST ain’t on board with the DIP amount because it greatly exceeds the value of the loan portfolio.

The debtor, however, wasn’t dissuaded. On July 20, 2026, it filed a reply justifying the DIP because Messrs. DuBois, Carroll, Dundon, and Jalbert, as well as Ms. Gladstone, don’t intend to work for free and the UST kinda failed to mention the fraudulent transfer asset altogether, which the lot of them thinks has real value.

Does it? We have no clue. But you have to admit, these are a novel set of circumstances.

The court held the first day hearing on July 24, 2026. Which seemed to have gone … not great. For the DIP at least; the docket suggests the UST’s and CFPB’s arguments resonated with Judge Marum. Instead of the interim $1.3mm, he limited the borrowings to $300k and scheduled the second day hearing for August 26, 2026 at 11am CT, which means, during the interim four weeks, the debtor’s professionals will almost certainly have to go without a cumulative ~$290k budgeted for the carveout account. Likely a few other creditors too — based on the budget, the debtor is going to be riding into that hearing on fumes.

The debtor is represented by Manatt, Phelps & Phillips, LLP (Schuyler Carroll, Patrick DuBois) as legal counsel, Dundon Advisers, LLC (Matthew Dundon) as financial advisor, and Financial Law Group (Leslie Gladstone) as CRO. Craig Jalbert is the debtor’s independent director. AZC is represented by Marshack Hays Wood LLP (Aaron de Leest) as legal counsel.

*Presently, California caps $2.5k-$10k loans at 36% interest.

Company Professionals:

• Legal: Manatt, Phelps & Phillips, LLP (Patrick DuBois, Schuyler Carroll)

• Financial Advisor: Dundon Advisers, LLC (Matthew Dundon)

• Independent Director: Craig Jalbert

• Claims Agent: Verita (Click here for free docket access)

Other Parties in Interest:

• Insider DIP Lender: Absolutely Zero Corporation

  • Legal: Marshack Hays Wood LLP (Aaron de Leest)

On July 19, 2026, Hartford CT-based, Catalina Re-owned Alea Holdings US Company, Alea Group Holdings (Bermuda) Ltd. and venue-providing TX-LLC, FIN Alea LLC, (collectively, the “debtors” and together with two non-debtor entities, the “company”) filed prepackaged (for real) bankruptcy cases in the Southern District of Texas (Judge Lop…

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On July 26, 2026, Atlanta-based Republic National Distributing Company, LLC (“RNDC”) and seventeen affiliates (collectively, together with RNDC, the “debtors” and together with their non-debtor affiliates, the “company”) filed chapter 11 bankruptcy cases in the Southern District of Texas (Judge Lopez). Up until recently, the company was a conglomerate that owned and operated the US’s second largest alcohol beverage distributor and if you feel compelled to take a deep drive into the pre-Prohibition era founding of its constituent parts, you are in luck. AlixPartners LLP’s (“Alix”) John Castellano, the company’s CRO, provides a wealth of unnecessary (but still interesting!) info in his first day declaration, going all the way back to 1898.

The TL;DR version is that Newman Goldring, Chris Carlos, Al Davis, and Edward Block …

… got into or re-entered the liquor distribution biz post-Prohibition, grew their businesses over decades, and consolidated into one big happy family through the late ‘90s and ‘00s. The descendants of those long-gone farts still own the company today through New BG Distribution Partners, LLC (“NBG”) and NDC Partners, LLC (“NDC”), which, respectively, have a one-third and two-thirds stake in RNDC.

The company then grew from ‘07 to ‘23 through twelve+ acquisitions and partnerships, bringing its distribution skills to ~19 new states over the following years. At its peak, that generated ~$12b in annual revenue across a cumulative ~40 states and had 10k+ employees.

This is where the story catches up to modern times: COVID happened. Here’s Mr. Castellano with the specifics:

“Before the COVID-19 pandemic, the alcohol industry experienced a prolonged period of steady growth. As government shutdowns forced the closure of restaurants and bars in April 2020, Americans were confined to their homes and increasingly turned to retail stores to purchase alcohol for in-home consumption. Retail and online sales channels saw a corresponding boom, resulting in an approximate 35% increase in retail alcohol sales during the spring of 2020.[] Distributors like RNDC raced to meet this incredible surge in demand by stockpiling unprecedented levels of inventory. Given that retail customers have historically generated the vast majority of RNDC’s revenue, and because RNDC was one of the only distributors with an eCommerce sales channel, RNDC was able to fully capitalize on this historic demand.”

The pandemic waned, demand did too, and the company was left with too much inventory. The kicker? That inventory doesn’t appear to be going anywhere. Back to Mr. Castellano:

“Since 2022, fewer and fewer Americans have reported drinking alcohol; the percentage of adults in the United States that report themselves as regular consumers of alcohol is the lowest it has been in nearly 90 years.”

The US drinking rate is now ~54% because, among other things, the younger crowd seems to prefer CBD/THC — Johnny sure as sh*t does too — and the older ones are on Ozempic. The upshot of which is that the company is obligated to purchase more booze from its distillery, winery, and brewery suppliers than it can sell to its bar, restaurant, and retail customers.

Those same suppliers are taking a beating too, which, from late ‘22 to ‘25, resulted in the loss of suppliers accounting for $3b+ in annual revenue, including Sazerac, the minds, taste buds, and livers behind Buffalo Trace, Pappy Van Winkle, SoCo, and Blanton’s.

Then mishaps with acquisition partners, and just like that, the company wasn’t able to service its funded debt: ~$1.3b in 1L, ~$260mm in equity-owned 2L, ~$7mm in equipment loans, and $47.7mm in owner notes (PETITION Note: we didn’t include a chart on purpose; you’ll see why). In September and October ‘25, the debtors retained the aforementioned Alix, Kirkland & Ellis LLP (“K&E”), and Lazard Frères & Co. LLC (“Lazard”) to advise, who shook the magic eight ball to reveal the company’s fortunes:

Time for the independents. In November ‘25, Scott Vogel and Charles Piper received the call, followed by John Young, Jr. in December. Meanwhile, the debtors’ 1L lenders and agent — Wells Fargo Bank, N.A. (“Wells”), repped by Paul Hastings LLP — pushed for a 363 sale process.

Which the company didn’t want. Given the heavy regulatory overlay in the alcohol industry, as well as the lack of legal documentation prevalent in it,** it and its advisors didn’t think that would come together in a BK and the debtors would instead be forced to liquidate for pennies on the dollar. Letter-writing ensued,*** but in January ‘26, the company got its way; the lenders pumped in another $250mm to facilitate a sale of the debtors assets in seven, later increased to eleven, markets to Reyes Holdings, L.L.C. (“Reyes”), which closed, subject to an end of year transition services agreement, on May 29, 2026.

To close out other pending sales, including (i) those of Nebraska, North Dakota, and South Dakota to Quality Brands Distribution, LLC, (ii) its wine-searcher.com business, and (iii) JV interests in an Idaho op, the lenders put in another $74mm.

Anyway, the net proceeds brought down the 1L debt ~$1.1b to this petition date figure:

But the lenders still aren’t done. They’re going to toss in another $75mm in new money ($50mm interim) under a DIP to try to find buyers for the assets in ~18 other states and otherwise liquidate the estates, for which they will receive (i) an interim roll-up of the $66.3mm in delay draw term loans ☝️ and (ii) a final order roll-up of ~$108.7mm on the revolver.**** The DIP requires the debtors to (i) file a plan and disclosure statement within five business days, (ii) execute binding purchase agreements for a majority of the going concern sales within thirty days, and (iii) confirm a plan and go effective within, respectively, seventy and seventy-five days.

The plan will also address the 2L and owner notes, and attached to Mr. Castellano’s declaration is the proposed settlement. Under it:

📍One-thirds equity owner New BG Distribution Partners, LLC and its related parties (collectively, “NBG”) will (i) pay $10.25mm to the debtors directly, (ii) waive any claim for expense reimbursement in negotiating the settlement, (iii) waive deferred compensation claims, (iv) waive any right to recovery on their prepetition debt, and (v) agree to the contribution of claims against them to a GUC trust, provided it is covered by a debtor D&O policy.

📍Two-thirds equity owner NDC Partners, LLC and its related parties (collectively, “NDC”) will (i) pay $40mm to the debtors directly and (ii) otherwise agree to the same framework above.

Which, if you’re wondering the reason for the generosity, Mr. Castellano has that too:

“Since 2018, RNDC LLC …”

… which is a pass-through entity for tax purposes …

“… has made more than $700 million in tax distributions to its direct equityholders, New BG Partners and NDC Partners, in proportion to their ownership of RNDC LLC.”

The Goldring, Carlos, Davis, and Block families be clingin’ onto that bag and don’t want too much heat from the debtors’ GUCs, who are estimated to be owed ~$400mm.

While on the topic of decision-making, let’s go back to governance for a moment. All of the sales consummated to date were prepetition. Like within a handful of months. Obviously that could be problematic for Messrs. Vogel, Piper and John Young, Jr. They had a leading role in seeking out, approving, and closing the sales, and naturally, they will want a release under the plan too.

So. What’s a debtor to do?

Simple: add more governance. On June 25, 2026, Jill Frizzley got the call-up as the debtors’ fourth independent and sole member of an “additional special committee.” It’s tasked to look under the hood and … bless her peers’ prior decision-making, 🙄^.

Whether that’s ever an issue is for another time. No doubt an official committee of unsecured creditors will have their own estate-funded peek too — at the prepetition sales prices and any assertable claims against the board members and equity.

The court held a ~1.33-hour long first day hearing on July 27, 2026, where the US trustee expressed new, negative feelings toward carveouts but was quickly overruled as all requested relief was granted. The second day hearing is scheduled for August 24, 2026 at 1pm CT.

The debtors are represented by K&E (Joshua Sussberg, Christopher Marcus, Maddison Levine, Joshua Raphael, Rachel Golden, Jennifer Davis) and Porter Hedges LLP (John Higgins, M. Shane Johnson, Megan Young-John, Joanna Caytas) as legal counsel, Alix (John Castellano) as financial advisor and CRO, and Lazard (Christian Tempke) as investment banker. The debtors’ independent managers are Scott Vogel, Charles Piper, John Young, Jr., and Jill Frizzley. Wells, as prepetiton and DIP agents, is represented by Paul Hastings LLP (Justin Rawlins, Geoffrey King, Lindsey Henrikson, Charles Persons) as legal counsel. One-third equity owner NBG is represented by Katten Muchin Rosenman LLP (Steven Reisman, Cindi Giglio, Rachel Riley, Stephen Rochester) as legal counsel, while two-thirds owner NDC is represented by Seward & Kissel LLP (John Ashmead, Robert Gayda, Thomas Hooper, Kwame Akuffo) as legal counsel.

*Namely, the debtors’ entry into CA and AZ was a disaster. In August ‘19, the company purchased a 50% stake in Young’s Market Company, LLC (“YMC”) from Young’s Holdings, Inc. (“YHI”) for $297mm, with respective put and call options for the other 50%. In August ‘22, YHI exercised the put, and the parties disputed the price. Ultimately, the company bought the other half of the equity for $422mm in November ‘22. Another dispute, relating to the termination of the Sazerac relationship, arose too, and to cut to the chase, the company paid YHI another $7.5mm to put it to bed.

**Suppliers and distributors seemingly operate on a handshake model.

***The dec attaches a well-written, January ‘26 letter from K&E to PH about the need for a DIP and the disastrous results that would befall the company if they pursued a wholly in-court transaction. Kudos to the writers.

****The DIP bears interest at SOFR + 8.50% and features a 3% closing fee, a 2% exit fee, and a $375k arranger fee.

💰How Are the Investment Banks Doing? (Lazard Edition)💰

Given Lazard Inc.’s ($LAZ)(“Lazard”) involvement in RNDC 👆, we figured we’d check in on our boys’ financial performance.

On Thursday, July 23, 2026, Lazard reported its Q2’26 results and they were … decidedly mixed. Featuring a top-line revenue beat, the firm sharply missed analysts’ EPS expectations mostly due to (i) an unusually high quarterly tax rate and (ii) bankers getting paid too damn much (or hiring … whatever). Well, also, financial advisory — that’s where our friends in RX sit — comped pretty poorly on a YOY basis (though, to be fair, LAZ lumps all financial advisory together so we have no way of measuring how RX fared on a sequential or YOY basis other than Head of Strategy and IR, William Murdock, saying that the group “…delivered strong results, achieving its best first-half performance in almost a decade.”).

In terms of highlights, the firm reported $786mm in adjusted net revenue (⬆️ 2% YOY) and GAAP net income of $5mm, a 91% YOY drop. Generally speaking financial advisory net revenue has followed an up/down/up/down/up pattern, like LAZ is strumming to some kinda sh*tty 311 track.* Meanwhile its asset management segment has been showing pretty strong growth. You can see for yourself here👇:

We would note that at least some of that there financial advisory revenue stems from the firm’s role advising Xerox Corporation ($XRX)** in connection with its IP joint venture transaction and associated new money financing from TPG Credit Solutions — something we wrote about here:***

But enough about that. We don’t really give a sh*t how much these guys are making or what the firm’s stock is doing … oh, by the way, it’s doing this …

… read: down 14% YTD as of July 28, 2026 … what we do care about is what they say about the future of RX activity.

Unfortunately, the answer is: not a heck of a whole lot. Asked about what level of momentum the RX group is seeing across different geographies, all CEO Peter Orszag had to say, in the bro-iest way imaginable, was that “[t]he restructuring team is flat out. Sorry, I should say restructuring and liability management since most of it’s liability management.” Illuminating, Peter, uber-f*cking “flat-out” illuminating.

Whatever. Get ready for more “another failed liability management exercise” entries in PETITION’s pages.

*Random, we know. There was a recent video of them playing in the NYC subway that, for whatever reason, got fed to Johnny’s social feed.

**The firm also highlighted several other roles, including:

“Lazard’s restructuring and liability management practice has been engaged in a broad range of mandates including debtor roles involving Deutsche Glasfaser, Republic National Distributing Company, Searles Valley Minerals, and Xerox Holdings, and creditor roles involving Dish, Gigaclear, Saks Global, and Trinseo.

In addition, Lazard is the preeminent financial advisor to governments and public sector entities across the world with recent mandates including the Government of Morocco, SriLankan Airlines, and the Government of Zambia.”

***As we subsequently discussed here, there ought to be some good follow-on work there too.

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💥Serta Simmons: Another Failed Liability Management Exercise. Part IX.💥

On July 19, 2026 we noted …

… that the losers third-party defendants in the Serta Simmons Bedding LLC drama …

… were trying to perform a little bit of (literal) damage control and hide the hit they’d be taking from Judge Lopez’s decision. Specifically, the losers third-party defendants sought to keep the “apportionment schedule” under seal but the plaintiffs noted that they “…believe the Court should enter the Apportionment Schedule along with the Judgment on the public docket” — to which we said “[n]ame and shame, fellas, name and shame!”

We got our wish.

On July 20, 2026, the damages apportionment schedule hit the docket with the defendants named and damages and pre-judgement interest allocations delineated. In summary — and to finally close the book on this matter — the results are as follows:

Check in on your friends y’all.

💥New Chapter 11 Bankruptcy Filing - Trajector Holdings LLC💥

On July 23, 2026, Trajector Holdings LLC (“holdco”) and twenty-one affiliates (collectively, together with holdco, the “debtors”) filed chapter 11 bankruptcy cases in the Middle District of Florida (Judge Brown). Founded in ‘14 by James Hill, II, Gina Uribe, and Richard Blaser, the debtors attempt to help clients “… understand, access, and navigate …” the US’s convoluted benefits programs. Their two principal businesses focus on programs under the U.S. Department of Veterans Affairs (the “VA business”), where they help ensure vets “… have complete and credible medical evidence …” for their applications, and the Social Security Administration (the “SSA business”), where it’s typically more straightforward: eligibility verification, paperwork, filing claims, yada yada yada.

The debtors are in chapter 11 because Mr. Hill and Ms. Uribe — each of whom owns ~44.67% of the company — don’t play well in the sandbox any more. You see, the holdco LLC agreement gives Ms. Uribe decision-making authority over “… technical medical consulting operations …” and Mr. Hill gets it over everything else. A spat arose about the delineation, and while the debtors thought they worked it out in August ‘24 via an addendum, surprise, they didn’t. It arose anew in early ‘26. Which maybe would’ve been fine if the debtors weren’t preoccupied with refinancing a ~$62.9mm, Deutsche Bank AG New York Branch (“DBAG”)-agented facility. But they were, 😔.

Delaware litigation for clarification ensued in May ‘26, and yes, technically, the company and Mr. Hill carried the day, but lack of agreement with their lenders — as well as the filing of two putative class actions in ‘26 alleging the VA business, which isn’t accredited, unlawfully charges fees “… for assisting with the preparation, presentation, and prosecution of VA disability claims,”* — made that victory Pyrrhic.

So chapter 11 it is — good, LOL, to see Mr. Hill and Ms. Uribe could agree on that. To get that process underway, the court held the first day hearing on July 24, 2026, where it granted all requested relief, and scheduled the second day hearing for August 17, 2026 at 11am ET.

The debtors are represented by Berger Singerman LLP (Jordi Guso, Clay Roberts, Edward Peterson) as legal counsel and Michael Moecker & Associates (Mark Healy) as financial advisor and CRO. DBAG is represented by White & Case LLP (Andrew Zatz, Kristin Schultz, Clint Simkins) and Smith Hulsey & Busey (John Thomas, Allan Wulbern, Carli Frederick) as legal counsel. Mr. Hill and his related entities — Blackfin Capital, LLC and Turner Raymond & Associates LLC — are represented by Burr & Forman LLP (J. Ellsworth Summers Jr.) as legal counsel.

*The debtors dispute the class actions, arguing they only create medical evidence. Think that’s right? It probably doesn’t matter. Many states have enacted, or are enacting, legislation similar to the state law cited in the two pending suits, so the business is likely dead any which way you cut it.

📚Resources📚

There’s a lot of jittery market activity out there so you’ll have to forgive us for having market dysfunction on our minds. As you know, we’ve had a long-standing list of a$$-kicking resources on the topics of restructuring, tech, finance, investing, and disruption which, in case you forgot,💥you can find here💥. We do occasionally update it and this week you’ll now find a number of titles we’ve been dabbling in related to financial bubbles/crises. Take a look and read until your heart’s discontent.

📤 Notice📤

Amanda Rush (Partner) joined Kirkland & Ellis LLP from Jones Day.

Daniel Prieto (Partner) joined Kirkland & Ellis LLP from Jones Day.

Sean Davis (Partner) joined Baker Donelson from Winstead PC.

Stephanie Marshak (Partner) joined Simpson Thacher & Bartlett LLP from Wachtell Lipton Rosen & Katz LLP.

NOTE: do you have exciting news to share? Feel free to email us — especially if you’re a firm administrator — with any and all personnel news at petition@petition11.com.

💰New Opportunities💰

PETITION is looking for MBA and JD candidates to work with us as paid interns. This is primarily a research and writing position for up to 10-20 hours a week that will give awesome exposure to the worlds of distressed investing, bankruptcy and restructuring. Work is remote. If interested, email us your resume at petition@petition11.com with the subject line “Internship” and we’ll be happy to answer questions. Cheers.

We’re also seeking a freelance social media manager to give life to PETITION’s accounts on Instagram and potentially other platforms. The ideal candidate has experience managing social for a media brand or creator, is fluent in Canva and/or Illustrator, can adapt newsletter content into sharp, on-brand social posts (feed, stories, reels), and understands and enjoys financial storytelling. If you’re interested or know someone who could be a great fit, please send your/their portfolio, relevant social handles, and a short note about your/their availability to petition@petition11.com.

On July 26, 2026, Atlanta-based Republic National Distributing Company, LLC (“RNDC”) and seventeen affiliates (collectively, together with RNDC, the “debtors” and together with their non-debtor affiliates, the “company”) filed chapter 11 bankruptcy cases in the Southern District of Texas (Judge Lopez). Up until recently, the company was a conglomerate that owned and operated the US’s second largest alcohol beverage distributor and if you feel compelled to take a deep drive into the pre-Prohibition era founding of its constituent parts, you are in luck. AlixPartners LLP’s (“Alix”) John Castellano, the company’s CRO, provides a wealth of unnecessary (but still interesting!) info in his first day declaration, going all the way back to 1898.

The TL;DR version is that Newman Goldring, Chris Carlos, Al Davis, and Edward Block …

… got into or re-entered the liquor distribution biz post-Prohibition, grew their businesses over decades, and consolidated into one big happy family through the late ‘90s and ‘00s. The descendants of those long-gone farts still own the company today through New BG Distribution Partners, LLC (“NBG”) and NDC Partners, LLC (“NDC”), which, respectively, have a one-third and two-thirds stake in RNDC.

The company then grew from ‘07 to ‘23 through twelve+ acquisitions and partnerships, bringing its distribution skills to ~19 new states over the following years. At its peak, that generated ~$12b in annual revenue across a cumulative ~40 states and had 10k+ employees.

This is where the story catches up to modern times: COVID happened. Here’s Mr. Castellano with the specifics:

“Before the COVID-19 pandemic, the alcohol industry experienced a prolonged period of steady growth. As government shutdowns forced the closure of restaurants and bars in April 2020, Americans were confined to their homes and increasingly turned to retail stores to purchase alcohol for in-home consumption. Retail and online sales channels saw a corresponding boom, resulting in an approximate 35% increase in retail alcohol sales during the spring of 2020.[] Distributors like RNDC raced to meet this incredible surge in demand by stockpiling unprecedented levels of inventory. Given that retail customers have historically generated the vast majority of RNDC’s revenue, and because RNDC was one of the only distributors with an eCommerce sales channel, RNDC was able to fully capitalize on this historic demand.”

The pandemic waned, demand did too, and the company was left with too much inventory. The kicker? That inventory doesn’t appear to be going anywhere. Back to Mr. Castellano:

“Since 2022, fewer and fewer Americans have reported drinking alcohol; the percentage of adults in the United States that report themselves as regular consumers of alcohol is the lowest it has been in nearly 90 years.”

The US drinking rate is now ~54% because, among other things, the younger crowd seems to prefer CBD/THC — Johnny sure as sh*t does too — and the older ones are on Ozempic.

The upshot of which is that the company is obligated to purchase more booze from its distillery, winery, and brewery suppliers than it can sell to its bar, restaurant, and retail customers.

Those same suppliers are taking a beating too, which, from late ‘22 to ‘25, resulted in the loss of suppliers accounting for $3b+ in annual revenue, including Sazerac, the minds, taste buds, and livers behind Buffalo Trace, Pappy Van Winkle, SoCo, and Blanton’s.

Then mishaps with acquisition partners, and just like that, the company wasn’t able to service its funded debt: ~$1.3b in 1L, ~$260mm in equity-owned 2L, ~$7mm in equipment loans, and $47.7mm in owner notes (PETITION Note: we didn’t include a chart on purpose; you’ll see why). In September and October ‘25, the debtors retained the aforementioned Alix, Kirkland & Ellis LLP (“K&E”), and Lazard Frères & Co. LLC (“Lazard”) to advise, who shook the magic eight ball to reveal the company’s fortunes:

Time for the independents. In November ‘25, Scott Vogel and Charles Piper received the call, followed by John Young, Jr. in December. Meanwhile, the debtors’ 1L lenders and agent — Wells Fargo Bank, N.A. (“Wells”), repped by Paul Hastings LLP — pushed for a 363 sale process.

Which the company didn’t want. Given the heavy regulatory overlay in the alcohol industry, as well as the lack of legal documentation prevalent in it,** it and its advisors didn’t think that would come together in a BK and the debtors would instead be forced to liquidate for pennies on the dollar. Letter-writing ensued,*** but in January ‘26, the company got its way; the lenders pumped in another $250mm to facilitate a sale of the debtors assets in seven, later increased to eleven, markets to Reyes Holdings, L.L.C. (“Reyes”), which closed, subject to an end of year transition services agreement, on May 29, 2026.

To close out other pending sales, including (i) those of Nebraska, North Dakota, and South Dakota to Quality Brands Distribution, LLC, (ii) its wine-searcher.com business, and (iii) JV interests in an Idaho op, the lenders put in another $74mm.

Anyway, the net proceeds brought down the 1L debt ~$1.1b to this petition date figure:

But the lenders still aren’t done. They’re going to toss in another $75mm in new money ($50mm interim) under a DIP to try to find buyers for the assets in ~18 other states and otherwise liquidate the estates, for which they will receive (i) an interim roll-up of the $66.3mm in delay draw term loans ☝️ and (ii) a final order roll-up of ~$108.7mm on the revolver.**** The DIP requires the debtors to (i) file a plan and disclosure statement within five business days, (ii) execute binding purchase agreements for a majority of the going concern sales within thirty days, and (iii) confirm a plan and go effective within, respectively, seventy and seventy-five days.

The plan will also address the 2L and owner notes, and attached to Mr. Castellano’s declaration is the proposed settlement. Under it:

📍One-thirds equity owner New BG Distribution Partners, LLC and its related parties (collectively, “NBG”) will (i) pay $10.25mm to the debtors directly, (ii) waive any claim for expense reimbursement in negotiating the settlement, (iii) waive deferred compensation claims, (iv) waive any right to recovery on their prepetition debt, and (v) agree to the contribution of claims against them to a GUC trust, provided it is covered by a debtor D&O policy.

📍Two-thirds equity owner NDC Partners, LLC and its related parties (collectively, “NDC”) will (i) pay $40mm to the debtors directly and (ii) otherwise agree to the same framework above.

Which, if you’re wondering the reason for the generosity, Mr. Castellano has that too:

“Since 2018, RNDC LLC …”

… which is a pass-through entity for tax purposes …

“… has made more than $700 million in tax distributions to its direct equityholders, New BG Partners and NDC Partners, in proportion to their ownership of RNDC LLC.”

The Goldring, Carlos, Davis, and Block families be clingin’ onto that bag and don’t want too much heat from the debtors’ GUCs, who are estimated to be owed ~$400mm.

While on the topic of decision-making, let’s go back to governance for a moment. All of the sales consummated to date were prepetition. Like within a handful of months. Obviously that could be problematic for Messrs. Vogel, Piper and John Young, Jr. They had a leading role in seeking out, approving, and closing the sales, and naturally, they will want a release under the plan too.

So. What’s a debtor to do?

Simple: add more governance. On June 25, 2026, Jill Frizzley got the call-up as the debtors’ fourth independent and sole member of an “additional special committee.” It’s tasked to look under the hood and … bless her peers’ prior decision-making, 🙄^.

Whether that’s ever an issue is for another time. No doubt an official committee of unsecured creditors will have their own estate-funded peek too — at the prepetition sales prices and any assertable claims against the board members and equity.

The court held a ~1.33-hour long first day hearing on July 27, 2026, where the US trustee expressed new, negative feelings toward carveouts but was quickly overruled as all requested relief was granted. The second day hearing is scheduled for August 24, 2026 at 1pm CT.

The debtors are represented by K&E (Joshua Sussberg, Christopher Marcus, Maddison Levine, Joshua Raphael, Rachel Golden, Jennifer Davis) and Porter Hedges LLP (John Higgins, M. Shane Johnson, Megan Young-John, Joanna Caytas) as legal counsel, Alix (John Castellano) as financial advisor and CRO, and Lazard (Christian Tempke) as investment banker. The debtors’ independent managers are Scott Vogel, Charles Piper, John Young, Jr., and Jill Frizzley. Wells, as prepetiton and DIP agents, is represented by Paul Hastings LLP (Justin Rawlins, Geoffrey King, Lindsey Henrikson, Charles Persons) as legal counsel. One-third equity owner NBG is represented by Katten Muchin Rosenman LLP (Steven Reisman, Cindi Giglio, Rachel Riley, Stephen Rochester) as legal counsel, while two-thirds owner NDC is represented by Seward & Kissel LLP (John Ashmead, Robert Gayda, Thomas Hooper, Kwame Akuffo) as legal counsel.

*Namely, the debtors’ entry into CA and AZ was a disaster. In August ‘19, the company purchased a 50% stake in Young’s Market Company, LLC (“YMC”) from Young’s Holdings, Inc. (“YHI”) for $297mm, with respective put and call options for the other 50%. In August ‘22, YHI exercised the put, and the parties disputed the price. Ultimately, the company bought the other half of the equity for $422mm in November ‘22. Another dispute, relating to the termination of the Sazerac relationship, arose too, and to cut to the chase, the company paid YHI another $7.5mm to put it to bed.

**Suppliers and distributors seemingly operate on a handshake model.

***The dec attaches a well-written, January ‘26 letter from K&E to PH about the need for a DIP and the disastrous results that would befall the company if they pursued a wholly in-court transaction. Kudos to the writers.

****The DIP bears interest at SOFR + 8.50% and features a 3% closing fee, a 2% exit fee, and a $375k arranger fee.

Company Professionals:

• Legal: Kirkland & Ellis LLP (Joshua Sussberg, Christopher Marcus, Maddison Levine, Joshua Raphael, Rachel Golden, Jennifer Davis) and Porter Hedges LLP (John Higgins, M. Shane Johnson, Megan Young-John, Joanna Caytas)

• Financial Advisor/CRO: AlixPartners LLP (John Castellano)

• Investment Banker: Lazard Frères & Co. LLC (Christian Tempke)

• Strategic Communications Advisor: Joele Frank

• Independent Managers: Scott Vogel, Charles Piper, John Young, Jr., Jill Frizzley

• Claims Agent: Omni (Click here for free docket access)

Other Parties in Interest:

• Wells Fargo Bank, N.A.

  • Legal: Paul Hastings LLP (Justin Rawlins, Geoffrey King, Lindsey Henrikson, Charles Persons)

  • Financial Advisor: Carl Marks Advisors

• 1/3rd Non-Debtor Equity Holder: New BG Distribution Partners, LLC

  • Legal: Katten Muchin Rosenman LLP (Steven Reisman, Cindi Giglio, Rachel Riley, Stephen Rochester)

• 2/3rds Non-Debtor Equity Holder: NDC Partners, LLC

  • Legal: Seward & Kissel LLP (John Ashmead, Robert Gayda, Thomas Hooper, Kwame Akuffo)

On July 23, 2026, Trajector Holdings LLC (“holdco”) and twenty-one affiliates (collectively, together with holdco, the “debtors”) filed chapter 11 bankruptcy cases in the Middle District of Florida (Judge Brown). Founded in ‘14 by James Hill, II, Gina Uribe, and Richard Blaser, the debtors attempt to help clients “… understand, access, and navigate …” the US’s convoluted benefits programs. Their two principal businesses focus on programs under the U.S. Department of Veterans Affairs (the “VA business”), where they help ensure vets “… have complete and credible medical evidence …” for their applications, and the Social Security Administration (the “SSA business”), where it’s typically more straightforward: eligibility verification, paperwork, filing claims, yada yada yada.

The debtors are in chapter 11 because Mr. Hill and Ms. Uribe — each of whom owns ~44.67% of the company — don’t play well in the sandbox any more. You see, the holdco LLC agreement gives Ms. Uribe decision-making authority over “… technical medical consulting operations …” and Mr. Hill gets it over everything else. A spat arose about the delineation, and while the debtors thought they worked it out in August ‘24 via an addendum, surprise, they didn’t. It arose anew in early ‘26. Which maybe would’ve been fine if the debtors weren’t preoccupied with refinancing a ~$62.9mm, Deutsche Bank AG New York Branch (“DBAG”)-agented facility. But they were, 😔.

Delaware litigation for clarification ensued in May ‘26, and yes, technically, the company and Mr. Hill carried the day, but lack of agreement with their lenders — as well as the filing of two putative class actions in ‘26 alleging the VA business, which isn’t accredited, unlawfully charges fees “… for assisting with the preparation, presentation, and prosecution of VA disability claims,”* — made that victory Pyrrhic.

So chapter 11 it is — good, LOL, to see Mr. Hill and Ms. Uribe could agree on that. To get that process underway, the court held the first day hearing on July 24, 2026, where it granted all requested relief, and scheduled the second day hearing for August 17, 2026 at 11am ET.

The debtors are represented by Berger Singerman LLP (Jordi Guso, Clay Roberts, Edward Peterson) as legal counsel and Michael Moecker & Associates (Mark Healy) as financial advisor and CRO. DBAG is represented by White & Case LLP (Andrew Zatz, Kristin Schultz, Clint Simkins) and Smith Hulsey & Busey (John Thomas, Allan Wulbern, Carli Frederick) as legal counsel. Mr. Hill and his related entities — Blackfin Capital, LLC and Turner Raymond & Associates LLC — are represented by Burr & Forman LLP (J. Ellsworth Summers Jr.) as legal counsel.

*The debtors dispute the class actions, arguing they only create medical evidence. Think that’s right? It probably doesn’t matter. Many states have enacted, or are enacting, legislation similar to the state law cited in the two pending suits, so the business is likely dead any which way you cut it.

Company Professionals:

• Legal: Berger Singerman LLP (Jordi Guso, Clay Roberts, Edward Peterson)

• Financial Advisor/CRO: Michael Moecker & Associates (Mark Healy)

• Claims Agent: Verita (Click here for free docket access)

Other Parties in Interest:

• Prepetition Agent: Deutsche Bank AG New York Branch

  • Legal: White & Case LLP (Andrew Zatz, Kristin Schultz, Clint Simkins) and Smith Hulsey & Busey (John Thomas, Allan Wulbern, Carli Frederick)

• Equity Owner: James S. Hill, II, Blackfin Capital, LLC and Turner Raymond & Associates LLC

  • Legal: Burr & Forman LLP (J. Ellsworth Summers Jr.)

Quickly recall that back on June 12, 2026, Minnesota-based Sleep Number Corp. ($SNBR) and four affiliates (collectively, the “debtors” or the “company”) filed chapter 11 bankruptcy cases in the Southern District of New York (Judge Kyu Young Paek) — and then take a look at the title we slapped onto our case coverage 👇 (which followed months of pre-petition attention here, here, here and here):

After which you should then take a look at this chart 👇:

It seems we underestimated the debtors and their professionals, Davis Polk & Wardwell LLP (“Davis Polk”) and, in particular, Guggenheim Securities LLC (“Guggenheim”).

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Back on July 10, 2026, Central Falls Detention Facility Corporation (the “debtor”) filed a prearranged chapter 11 bankruptcy case in the District of Rhode Island (Judge Dorsey).* The public corp. debtor owns and operates the Donald W. Wyatt Detention Facility in Central Falls, Rhode Island (the “city”), which can house up to 782 detainees awaiting trial…

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Our beloved Johnny found himself in NYC recently and opted, on a sweltering summer day, to take an MTA bus rather than suffer the Hades that is NYC’s underground subway system. As the Select-bus pulled up, a dozen people disembarked while about two score piled in. Only Johnny’s dumba$$ actually paid. Literally. So how did he pay? He …

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On a Tuesday afternoon.

The irony decidedly lost on the guy.

“Suuuuure you are,” thought Johnny, “the entire industry is twiddling their thumbs but you’re super crazy busy, got it.” Cue the 🙄.

Yes. Johnny is judgmental as f*ck.

But the numbers back his skepticism.

On Friday, July 17, 2026, Fitch Ratings (“Fitch”) issued new commentary. They indicated:

“In June 2026, the U.S. leveraged loan (LL) trailing 12 months (TTM) default rate fell sharply to 3.8% from 4.5%, while the high-yield (HY) bond rate declined to 2.7% from 2.9%. These moves were driven mainly by base effects as large June 2025 defaults, including Altice France S.A., rolled out of the trailing window, rather than by meaningful underlying credit improvement. In HY, this was partly offset by DISH DBS’s USD9.75 billion Chapter 11 filing.”

Ok, fine. No meaningful underlying credit improvement. That’s believable. There’s more:

“Fitch maintains its 2026 default forecasts at 4.5%-5.0% for LLs and 2.5%-3.0% for HY bonds and expects defaults to rise in the second half of the year as base effects fade and maturity pressure builds. Total amount outstanding on Fitch’s combined Market Concern Loan lists rose to a record USD273 billion, or roughly 17.2% of the LL market, up from 16.4% in early June. This is consistent with Fitch’s 2026 default forecast, which anticipates further defaults, and underscores ongoing market distress. By contrast, the Market Concern Bond list declined to 9.9% of the market from 10.2% at the beginning of June, as DISH DBS and Accendra Health, Inc. exited following default.”

Fitch’s take comported with S&P Global Ratings (“S&P”) which, for its part, issued a new report on Thursday, July 16, 2026. Here were its “key takeaways:

Maybe homeboy was busy on some distressed exchanges. Per S&P:

“Distressed exchanges remained the primary driver of defaults in June, accounting for 60% of the month’s total (three of five defaults) and 46% of defaults year to date. While distressed exchanges continue to lead, their YTD share is materially lower than 57% for the same period in 2025, reflecting a decline in the number of distressed-exchange defaults to 23 through June 2026 from 36 a year earlier. Missed payments were the second most common cause of default, totaling 16 YTD, followed by bankruptcy-related defaults with seven.”

Or maybe not.

Even the LME bros have more time for golf, it seems.

Blackrock, after underscoring the same downward trending default rate noted ⬆️, indicated that certain segments of the private credit universe might be where Johnny’s golf buddy’s action may lie. In a recent report dated July 16, 2026, research strategists Dominique Bly and Jack Sweeney wrote:

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On June 26, 2026, Braskem S.A. and five affiliates (collectively, the “debtors” and together with their non-debtor affiliates, the “company”) filed long-anticipated chapter 15 recognition proceedings through their foreign representative Antonio Reinaldo Rabelo Filho (the “foreign rep”) in the Southern District of New York (Judge Wiles). A growing trend!

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If you recall, at the very end of ‘24 — a staggering 1.5 years ago — the Fifth Circuit took a massive pre-cyclospora deuce on the man formerly known as Judge Jones by unanimously reversing his decision that the June ‘20 liability management exercise (“LME”) performed by Serta Simmons Bedding (together …

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💥New Chapter 11 Bankruptcy Filing - DISH DBS Corporation and DISH Wireless L.L.C.💥

What even is a “prepack”? At one point, Johnny thought he knew — a filing that was expected to go smooth as butter on account of prebaked widespread support.

More and more though, he isn’t sure.

Case in point. On June 30, 2026, EchoStar Corporation ($ECHO)-owned, Englewood, CO-based DISH DBS Corporation (“DBS”), DISH Wireless L.L.C. (“DWLLC”), and sixteen affiliates (collectively, together with DBS and DWLLC, the “debtors” and together with their non-debtor affiliates, the “company”) filed chapter 11 bankruptcy cases in the Southern District of Texas (Judge Lopez).

Cases, which, debtors’ counsel White & Case LLP (“W&C”) says are prepackaged. Here’s the plan and here’s the disclosure statement.

We’ll assume some familiarity with the company. It’s a well-known pay-TV, wireless, and internet service provider, and the debtors constitute two of its business segments. That is, DWLLC and four debtors (collectively, the “wireless debtors”) built out (PETITION NOTE: key tense there) the company’s nationwide 5G mobile network infrastructure following its antitrust-driven acquisition of Sprint Corporation’s Boost Mobile in ‘20. All in, the company dumped ~$46b into that op before, following an “… unusual …” — first day declarant and COO John Swieringa’s words — investigation by the US Federal Communications Commission (the “FCC”) in spring ‘25, (i) agreeing to sell its spectrum to AT&T Mobility II LLC (“AT&T”) and Space Exploration Technologies Corp. ($SPCX) (“SpaceX”) for ~$42b, a figure roughly $12b more than the company paid for the spectrum, and (ii) calling a FCC-inspired force-majeure event under its agreements under its tower leases and infrastructure and vendor agreements, which in turn prompted lawsuits to rain down. Now, those entities don’t operate.

Meanwhile, DBS and its subsidiaries (collectively, but excluding the wireless debtors, the “DBS debtors”) do. They run the TV segment, including Sling TV,* and with respect to those entities, we agree with W&C. This is a prepack. After two+ years of litigation relating to a liability-managing, asset-shuffling transaction,** they hammered out a restructuring support agreement (the “RSA”) in March ‘26 — you know, 3-ish months before the petition date — with an ad hoc group of the DBS debtors’ funded debt holders (the “ad hoc group”), represented by Milbank LLP and Lazard Frères & Co. ($LAZ).

Importantly, the DBS debtors and the wireless debtors have wholly-different capital structures. DBS has that third-party funded debt ☝️, and had they filed on their own, the DBS debtors would fly through chapter 11. In fact, no one on that side of the house is even taking a haircut. The notes will be amended and paid in full, and every other class — including general unsecured claims — will pass through the bankruptcy unimpaired.

Easy peasy. In principle.

Unfortunately for the ad hoc group, the DBS debtors filed alongside the wireless debtors, which aside from intercompany “loans” (discussed 👇), are burdened by contingent creditors — i.e., litigants in the lawsuits demanding billions in damages, which the company disputes. AKA there’ll be a lot of painful, long-lived bankruptcy litigation.

So, no matter how hard W&C’s Tom Lauria floats around the term “prepackaged,” the wireless debtors’ cases are not. Hearing length illustrates that. In a real prepack, everybody’s singing kumbaya and praises abound — the hearings are damn quick and (mostly) efficient. As they should be.

The debtors’ July 1, 2026 first day hearing was not that. It ran — holy hell — ~3.5 hours …

… which still wasn’t enough.

July 8 served as the second first-day hearing, which ran another three hours. For an aggregate 6.5 hours of judicial oversight to get standard-a$$ first-day relief.

Relief that, btw, did not include the debtors’ emergency ask for conditional approval of the DS.

LOL, “prepack.”

Now seems a good time to introduce the disruptors. They’re Crown Castle, repped by Paul, Weiss, Rifkind, Wharton & Garrison LLP (“PW”), American Towers LLC and its affiliates, repped by Ropes & Gray LLP, and DPI Retail, GGP Services Inc., Landmark Dividend, and LBA Realty, LLC, repped by Allen Matkins Leck Gamble Mallory & Natsis LLP and Kelley Drye & Warren LLP, each of which were burned by the force-majeure call. They sure as sh*t ain’t signed off on the plan with respect to the wireless debtors. To illuminate, here’s PW’s Brian Hermann:

“The [wireless debtors’ path], to be fair, is a freefall Chapter 11 through which the DISH Wireless Debtors will liquidate and its creditors are projected by DISH to receive 1 to 2 cents on the dollar. I take issue with Mr. Lauria’s characterization of that as a classic prepack. Unsecured creditors who were not spoken with during the two years that the company has been moving assets around and doing all kinds of things to restructure, are our client and I think the creditors that are similarly situated to our client have not been spoken with about the restructuring and this is not a prepack.”

LMAO, a “prepack” lacking key creditor input, 🤣.

Wait, somebody had to have been solicited, right? Oh, somebody was. Back to Mr. Hermann:

“… as you heard, Mr. Lauria would like to carry the class of unsecured claims [at the wireless debtors] with an inter-company claim that was possessed up until recently by an insider affiliate. That’s an $8.8 billion claim that resided at DISH Network Corporation that they then transferred to DBS, and then they inexplicably transferred to a trust for the benefit of creditors who are otherwise being paid in full under the DBS Plan.”

The company calls that claim a loan, but PW clearly intends to put it under the microscope. The company documented the “loan” in August ‘25 for amounts “borrowed” by the wireless debtors dating back to ‘20 and, even though the company trades publicly, never reported it. Anyway, Mr. Hermann goes on:

“Your Honor, while I don’t know this to be true sitting here today because I don’t have access to discovery, I can say pretty confidently that this is a contrived mechanism to take what is an insider claim and give it the appearance of a third party claim.”

Yeah, that sounds right, Mr. Hermann. “Prepack.”

Johnny’s starting to experience semantic satiation.

Anyway, what exactly is driving ECHO’s decision-making here? Simple. We’ll point you to the $42b sale of spectrum and go back to Mr. Hermann one last time:

“I would point out that that’s $12 billion more than they paid for the spectrum only five years earlier, so they did so at a substantial profit. And candidly I think what the DISH Wireless case is all about is how much of that can they keep for themselves, so how much can EchoStar’s non-Debtor keep, as opposed to having to share it with the creditors of DISH Wireless.”

Now we get it. Even though its approach to the plan is “novel,” ECHO intends to effectuate that outcome without reinventing the wheel. It has a $300mm stalking horse 363 bid set up for the wireless debtors’ assets,*** including, duh, claims against ECHO and its affiliates, offset by a credit bid of ECHO’s proposed $85mm wireless debtor DIP.****

The debtors will take a shot at that DIP, the DS motion (again), and less controversial second-day relief on July 23 at 9am CT, followed by a vote estimation motion for the disruptors and SBA Telecommunications, LLC in mid-August.

We’ll be sure our 🍿 is good and buttered for both.

The debtors are represented by W&C (Thomas Lauria, David Turetsky, Samuel Hershey, Andrea Amulic, Matthew Linder, Laura Baccash, Ronald Gorsich, Doah Kim, Charles Koster) as legal counsel, FTI Consulting, Inc. ($FCN) as financial advisor, and FCN-affiliate FCN’s FTI Capital Advisors, LLC (Glenn Tobias, Douglas Edelman) as investment banker. The debtors’ special committee is composed of Gerard Uzzi and Vikram Jindal and is represented by Dentons US LLP (Van Durrer II, David Shim) as legal counsel. The ad hoc group is represented by Milbank LLP (Dennis Dunne, Lisa Laukitis, Abigail Debold, Andrew Leblanc) and Howley Law PLLC (Tom Howley, Eric Terry) as legal counsel and LAZ as investment banker. Crown Castle is represented by PW (Brian Hermann, Kyle Kimpler, Jeffrey Recher, Grace Hotz) and Porter Hedges LLP (John Higgins, M. Shane Johnson, Megan Young-John, Jack Eiband) as legal counsel. American Towers LLC is represented by Ropes & Gray LLP (Daniel Forman, David Hennes, Andrew Todres, Casey Kyung-Se Lee, Margaret Alden, William Roberts) and Hunton Andrews Kurth LLP (Tad Davidson II, Ashley Harper, Philip Guffy) as legal counsel. DPI Retail, GGP Services Inc., Landmark Dividend, and LBA Realty, LLC is represented by Allen Matkins Leck Gamble Mallory & Natsis LLP (Ivan Gold) and Kelley Drye & Warren LLP (Robert LeHane, Jennifer Raviele, Charles Fendrych) as legal counsel. ECHO is represented by Morris, Nichols, Arsht & Tunnell LLP (Robert Dehney, Sr., Eric Schwartz, Matthew Harvey, Daniel Butz, Sophie Rogers Churchill, Luke Brzozowski) as legal counsel. SBA Telecommunications, LLC and its affiliates are represented by Akerman LLP (Lucian Murley, Laura Taveras) as legal counsel.

*These really are distinct businesses too. In ‘25, the DBS debtors booked operating income of $2.4b on revenue of $9.7b. Compare that to the wireless debtors, which in ‘24 — their last full year of operation — brought home negative $477mm in operating income on revenue of $3.6b.

**Here’s the gist of the January ‘24 LME, courtesy of Milbank’s Dennis Dunne:

“In January of 2024 DISH DBS moved a substantial amount of our collateral and other value out of the DBS obligor’s on our debt, specifically DBS transferred 4.7 billion of intercompany loan receivables to a wholly owned subsidiary of EchoStar for zero consideration, they transferred 3 million DISH TV subscribers to a newly formed unrestricted subsidiary and they designated its Sling TV subsidiaries as unrestricted subsidiaries thereby placing the Sling TV business beyond the reach of the DBS bond holders.

In addition, DBS effectuated a series of cash advances from DBS to DISH Network totaling over time more than $2 billion. Around the same time DBS launched an exchange offer for the bonds, the exchange offer was priced at what we believe were unattractive levels. Our group entered into a cooperation agreement and the exchange offer failed and was ultimately withdrawn.”

Defeat notwithstanding, the company didn’t return the assets to DBS, so the ad hoc group sued.

***Which doesn’t carry any bid protections.

****The DIP isn’t up for hearing yet. DWLLC has sufficient cash to trudge along, so the debtors put the DIP on ordinary notice. The would-be DIP proposes to pay 11.5% PIK interest and has no fees. It’s also proposed to be subordinate to an April ‘26, $75mm DBS-to-DWLLC secured loan, which we assume Mr. Hermann will also be scrutinizing.

🚤Update - West Marine Inc.🚤

Back on May 17, 2026, West Marine, Inc. and seven affiliates, retailers of, among other things, boating supplies, fishing gear, marine equipment (collectively, the “debtors”), filed prearranged chapter 11 bankruptcy cases in the District of Delaware (Judge Owens). The upshot of the filing was that the debtors had a restructuring support agreement (the “RSA”) with substantial support from (most) parties in interest and that the restructuring would dramatically reduce leverage …

… by, among other things, equitizing that there 👆 ‘28 term loan facility held by a variety of sophisticated lenders. There was — as one might expect from a Kirkland & Ellis LLP (“Kirkland”) RSA — a toggle option, about which we wrote the following:

This, we should note, was the continuation of a tepid marketing process pre-petition, during which Portage Point had reached out to five potential purchasers.

So? Was our skepticism warranted?

It appears so. Seems the debtors drew scant interest.

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What even is a “prepack”? At one point, Johnny thought he knew — a filing that was expected to go smooth as butter on account of prebaked widespread support.

More and more though, he isn’t sure.

Case in point. On June 30, 2026, EchoStar Corporation ($ECHO)-owned, Englewood, CO-based DISH DBS Corporation (“DBS”), DISH Wireless L.L.C. (“DWLLC”), and sixteen…

Read more