American court hearing recordings and interviews - Listen to the Saks bankruptcy court hearing of May 1, 2026, 9 am

Episode Date: May 6, 2026

seeking and receiving approval of a revised disclosure statement that is subject to further revision, towards commencing solicitation of votes in support of a chapter 11 plan to exit bankruptcy

Good morning. It's 9 a.m. on Friday, May 1, 2026. We're here on various matters in case number 26-9013, SAC's Global Enterprises LLC. So why don't we get appearances of counsel, and then we can proceed. Good morning, Your Honor. Deborah Sinclair, Wilkie Far and Gallagher,

on behalf of the Global Better. Good morning. Good morning, Your Honor. Bob Britton, Paul Weiss on behalf of his different. lenders I'm joined on the screen by my partner this happens morning good morning your honor the Renzell Mary Newsie Morrison enforced her on behalf of the official community of unsecured creditors good morning good morning honor this is uh michael weirden on behalf of the SO5 digital letters good morning good morning your honor jerry

lee miller from chisdley afton on behalf of sign of property group morning good morning your honor omni 40 of siddley austin on behalf of sonic and related entities. All right. Does anyone else wish to make an appearance? All right, Ms. Sinclair? Yes, Your Honor. Good morning, Your Honor.

Again, for the record, Debris, and Clair, Rokey Farned Gallagher for the global debtors. Your Honor, we are here to seek conditional approval of the disclosure statement for the joint Chapter 11 plan of Stax Global Goldings LLC and its affiliated global debtors. Before we get into the substance of the disclosure statement, I just want to thank, Your Honor, for accommodating us this morning. I know we filed the proposed documentation just a few hours before the start of the hearing, but the good news is that the vast majority of the changes you'll see in the documents are intended to reflect the deal that we announced on the record last week. With the, I'm getting a lot of background.

Yeah, I know. We have a lot of people on. So I'm going to activate the hand-raising feature, so hit five-star one time. Conference, muted. All right, I think you're back on. Yes, Your Honor, can you hear me? I can. Great.

So as I was saying, most of the changes you'll see in the documents that we filed on the docket are intended to reflect the deal we discussed at our last hearing, which, again, is a global settlement among the global debtors, the ad hoc group and the official committee of unsecured creditors. We have also, since our initial filing of the disclosure statement, resolved all other formal and informal comments that we received from parties in interest in the case. So we expect that we really are proceeding here on a consensual basis today. And before I walk through the changes to the documents, Your Honor, I'd like to note that the settlement really marks a critical achievement for the global debtors.

Assuming, Your Honor, is ready to approve our disclosure statement on a conditional basis, fact, global would be ready to start soliciting creditor votes on a Chapter 11 plan of reorganization. And in light of the settlement with the UCC and our restructuring support agreement, will be commencing that plan solicitation with the support of our ad hoc group and the official committee of unsecured creditors, which is a key step along our path to emergence this summer. I want to note quickly, Your Honor, that the documents do remain subject to the review of the ad hoc group and the UCC, as well as the company. We're expecting to make some non-material changes to the docs that we do not collectively believe will require us to come back before the court.

As you probably have surmised, we were working overnight with UCC in the ad hoc group to get the documents as far as we could for this morning's hearing, and we wanted to give people time to get before their clients, given that we were putting the finishing touches on things at an extremely late hour. So that's the reason that you see that disclaimer at the top of the dock, but again, we don't think any of those changes will be material. We're anticipating finalizing everything early this evening so that we can meet strato's internal deadlines to get our solicitation commence no later than Monday, May 4th, as is reflected in the proposed order. With that, Your Honor, I would propose that we move into the presentation of the disclosure statement,

which was filed a docket number 2163. Right, before you do that, let me see clear, before you do that, does anyone else wish to be heard by way of, in essence, an opening statement? Just, let me just pause for a minute. Ms. Boardy, did you hit five star? Your hands raised. Did you hit five star? I did make a hit five star.

I just wanted to make a statement at the end. At the end. So I just wanted to be unmuted at that time. Thank you. All right. All right. I guess there's no statements. So Ms. Miller, are you here for the disclosure statement or for the status conference?

Hit five, hit, oh, just hit five star one time. No, I don't see you. There you go. I think I just unmuted you. Thank you, Your Honor. Can you hear me? I can hear you, yes. Your Honor, I did have one brief comment just to make with respect to the status conference,

happy to make it after the disclosure statement or before at your preference. Okay. I mean, either way, either way. So we'll let's go forward with the disclosure statement and then we'll come back to that. Sounds good, Your Honor. Thank you. All right. All right.

Go ahead, Ms. Sinclair. Yes, Your Honor. So I think the easiest way to do this might. for me to explain the material terms of the global settlement so that Your Honor understands the lay of the land, and then we can walk through at a very high level of the substantive changes to the disclosure statement, if it pleases the court. Go ahead. The key element of the settlement that we've reached with the ad hoc group and the unsecured

creditors is the establishment of a litigation trust. It will be administered by a trust administrator that is selected by the UCC with the reasonable consent to require consenting dip term loan lenders. That trustee will be empowered to investigate. litigate and settle claims on behalf of the trust with the goals of obtaining recoveries for the beneficiaries. In terms of the trust funding, the trust is slated to receive $20 million in cash on the effective date from the global debtors. That will be repaid to the global debtors from the proceeds of any litigation trust access, subject to a one-point-time multiple uninvested capital.

In terms of the trust assets, the litigation trust will receive all causes of action that are not otherwise retained by the global debtors, released under the plan. As for the allocation of the trust assets, the Class A trust interest will be distributed to holders of both the DIP term loan claims and the pre-petition secured obligations, while the Class B trust interest will be distributed to holders of general unsecured claims with any further sub-allocation of those Class B interests to be determined by the Official Committee of Unsecured creditors in consultation with the company. The truck proceeds will be distributed as follows, first to repay the initial funding, as I just mentioned.

Second, after that repayment is made, the Class A and Class B interest share all proceeds 50-50 until $80 million of proceeds in the aggregate had been recovered. And then after that initial distribution and after that $80 million in proceeds is recovered, third, class A beneficiaries would receive 80% of any subsequent proceeds while the class B beneficiaries would receive the remaining 20% of any such proceeds. Just a few other things I think are important to note on the settlement. First, in connection with the settlement, the parties have agreed upon the terms of the release and exploitation that are reflected in the most recently filed version of the plan. Second, the plan now separately classified go-forward trade claims.

Those holders are anticipated to receive both litigation trust class B interest as well as a pro-out a share of a supplemental cash pool. And finally, the key term of the settlement, Your Honor, the UCC must immediately cease incurring fees and expenses in connection with the ongoing investigation, subject to some limited exceptions for ongoing discovery matters. Of course, the creditors committee has agreed to support the plan and the disclosure statement on these terms and to recommend that all general and secured creditors vote in favor. of the plan.

With that, Your Honor, unless you have questions about the settlement, I propose that I do a high-level walk-through of the red line, and to the extent, Your Honor, with questions about specific provisions, I can address those. No, go ahead. I did have a chance to review the red lines, so this morning. Go ahead. Excellent, Your Honor. So I'll be quick, then.

Starting at the top, on page 2, we built in a clear recommendation from the debtors, the ad hoc group in the UCC that creditors vote in favor of the plan by the proposed voting deadline of June 1. Following that, we made a handful of updates about the company's progress with brands, including that since the petition date, nearly 720 brands have resumed shipping to the debtors, and more than 320 brands have either agreed or near-reaching agreement on go-forward trade terms. In the FAQ section, which covers roughly pages 9 through 32 of the red line, there are a number changes intended to account for the final plan classification scheme, the proposed treatment

of creditors, and again a summary of the terms of the settlement we just described. Following that, Your Honor, we then added, and I think this really takes us through about page 60, we've added a handful of updates about motions and other case developments that have all largely been before your honor. On pages 57 through 58, I'll take a minute here because I think it's important. We've added a disclosure from Council of the Special Committee, regardless of the first committee, regarding the special committee's work on the company's restructuring and their independent investigation into any claims or causes of action that should be preserved by the debtors.

The work the special committee has done thus far, and this is reflected in the DS insert, it does serve as the basis for the proposed releases in the plan and the scope of the retaining causes of action in the litigation trust. On page 61, we similarly included a disclosure regarding the UCC's investigation, which we've also obviously taken into account in the terms of our global settlement. Your Honor, for the balance of the changes to the document, I think I would just put them into a few categories. One is filling in placeholders and making cleanup changes to the plan treatment section,

which previously had some blanks. We've added the exhibits, the liquidation analysis, the valuation and the projections. We've updated our tax disclosures to reflect the UCC settlement. We've removed the concept of a plan administrator. and inserted all of the key terms around the litigation trust, again reflecting the terms of the settlement we just talked about. We have incorporated comments from the indenture trustees around cancellation of the securities documentation

and their fees and expenses. We've reflected the committee settlement in the modifications and amendment section, and we have inserted language requested by the debtor surety bond providers and the PBGC, which we agreed upon with each of those respective parties. So unless, Your Honor, any questions, the debtor submit that the disclosure statement contains adequate information within the meaning of Section 1105 and request that you approve the DS on a conditional basis today. All right. Does anyone else wish to be heard?

Your Honor, if I may be heard, Lorenzo Marinoosie Morrison and Forster on behalf of the UCC, I think of Ms. Sinclair's fortunately succinct presentation on the disclosure statement doesn't accurately convey the amount of work that went into getting here. and the, I won't say, excruciating, but pretty agonizing late-night discussions over the settlement, which is now incorporated into the disclosure statement. We did finish our discussions, as you're on our notes from the timing of the filing of the revised plan of the disclosure statement, well into the night. We've all got clients that have to have an opportunity to review what it is that we're putting in front of them, although we've been keeping them up to speed generally on the open points over the course of the past several weeks

that we've been negotiating to get to this point. We expect everything will be fine, but as Ms. Sinclair said, there might be some changes that we're going to work through, and we will do a great job as we've done to get here to finalize the plan documents so that they can get filed today. All right. Anyone else? Thank you. I did have an opportunity, as I indicated, to review the red lines this morning of the revised plan disclosure statement. And I think that they contain sufficient information. I commend the parties for having reached a settlement with respect to the treatment.

So, Ms. Borty, did you want to make your statement now? Thank you, Your Honor. I was having trouble getting off mute quickly enough. We just wanted to note that we did have a reservation of rights with respect to the disclosure statement. We do not have an objection with respect to disclosure statement. We also thank the debtors and the ad hoc group for work. constructively, but at this time, we are not resolved, and we may be back in front of your honor with respect to the plan and the treatment of the exonic claims.

At this time, we are not resolved, and we do not believe that the plan can be confirmed based on the treatment that we've been provided. Thank you, Your Honor. All right. Okay. All right. Anyone else wish to be heard? All right.

So, as I indicated, I do think that the disclosure statement contains sufficient information to go to be set. for a vote. So and and you know, I think we're on a quick timeline. So we're about five weeks out from, uh, from confirmation. Uh, so, uh, Ms. Sinclair, you, you all filed a, an order at, uh, 2166. Is that the order, is that order? Is that order the one you want me to enter? Yes, your honor. Okay. Yeah. I think the, the only point I would notice that our draft header was also on that order.

I do think it's appropriate to remove the draft header for purposes of entering the order, understanding that we're all working through the DS itself and the plan. That order has been signed and sent to docketing. Thank you, Your Honor. Your Honor, I apologize. Lerentzor Mary News again. One thing I neglected to mention, we have a very short letter urging support for the plan that will send the chamber shortly after this call.

It's the letter that you've seen many times, I'm sure. Yeah, no, and I did notice that there was a specific, insert saying that there was a letter there was going to be a letter from the committee we're just waiting for client sign off that'll be over too shortly thank you all right all right for some reason the other matters today have all been set for 10 o'clock and I don't know whether it was that originally we all had it set all at 10 and then moved some up to 9 but I don't feel comfortable going forward now on the other matters that are set for 10 o'clock. I know everyone's here already, but so in connection, for instance, the UCC's motion to expedite,

Richard Baker's motion to quash, is that still going forward at, uh, at 10? I don't believe. So you're all to refer to Mr. No, you're on. Okay. You're on it's it's not going forward at 10. All right. So, so what we really have at, at 10 is, uh,

Mr. Reardon's conditional approval and I guess the assignment status conference, those are the two things that are set at 10 that are still going forward. Hold on. Mr. Angelou, I think I just unmuted someone. Yes, Your Honor. I apologize. I can't actually get onto the camera. This is Jason Angelo from Reed Smith on behalf of Citibank. We're indenture trustee, collateral agent for certain of the notes.

I just want to say something on the record. We appreciate very, very much the debtors and out-hap committee working with us on a variety of changes, much of which has been incorporated into the plan that was filed last night. We'll continue to work with them. Just for the note for just for purposes of the statute of record, there are two roles that we have, as collateral agent that we'd like to see added to the definition of pre-petition trustees and agents that has to do with the definition in turn of the released parties under the plan. I'm confident that we can work together with Wilkie to resolve that and our other issues,

but I just wanted to put that on the record. Otherwise, we had no other objections. As I said, we worked constructively with the team at Wilkie to resolve our informal comments and we appreciate it. All right, Ms. Miller. Your Honor, can you hear me okay? I can hear you fine, yes. If it's okay with Your Honor, I'm happy to make the brief update with respect to the status conference now.

Okay, go ahead. Okay, Your Honor, we still believe we have a deal with the global debtors. We have hit some snags in the definitive documentation process, but we've talked to all the parties while working constructively and we have commitments to try to resolve it all over the weekend. So, Your Honor, our plan right now is to have a 90-19-19, motion on file for your honor's consideration by midday Tuesday and to the extent that falls through and we don't have it on we'll just reach out to your honor's courtroom deputy to schedule a hearing to

move forward on the status conference okay all right sounds good yeah so all right so i think what we're i think what we need to do unfortunately is just um you know go have a cup of coffee and come back at 10 and then we'll we'll pick up with uh mr at that point. Thank you, Your Honor. All right. So we're in recess until 10 o'clock.