American court hearing recordings and interviews - Listen to the Ultinon Motion Holding B.V. et al. March 31 bankruptcy court hearing

Episode Date: March 31, 2026

This is the official audio of the court hearing held 3/31 and is docketed in the bankruptcy proceedings as docket number 51. For more information about the bankruptcy proceedings see the case administration site at https://restructuring.ra.kroll.com/ultinon/Home-Index

Good afternoon. This is Judge Lopez. Today is March 31st. I'm going to call the 1 p.m. case. First day hearings in 26, 904-28. Today is a virtual hearing. There's no one in the courtroom. I just asked if you are on the line and wish to make an appearance. Please hit 5-star, and I will unmute your line. I would also ask that you please make an appearance electronically. Just jump on the line. the Southern District of Texas web page you'll find a link to my home page and a place to make electronic appearances and they'll find a link in this case so I'm going to unmute a few lines here make 2-1-2 number good afternoon your honor David Feldman from Clifford chance on behalf of the proposed debtors I'm joined here today by my colleague Maddie Nicolini I'll be making some introductory remarks and Maddie will be handling the balance of the first-day motions Okay, good, good afternoon. Here's another 2-12 number.

Good afternoon, Your Honor. Christian Jensen, Sullivan and Cromwell, representing Banco Santander and Deva Capital Investments the left agent and lender under the debtor-secured facility. Good afternoon. A 202 number. Good afternoon, Your Honor. Jason Ruff of the U.S. Ruff. Good afternoon, Mr. Ruff.

And a 917 number. Good afternoon, Your Honor. My name is Jamie Donat. I am the Independent Director. and the independent director at the Altonan holding companies. Good afternoon. Does anyone else wish to make an appearance? Give me one moment.

Okay. Who should I turn this over to? Believe it would be me, Your Honor. Okay. Thank you so much, Your Honor. Again, David, for the record, David Feldman, Clifford Chance on behalf of the proposed debtors. We're here today for the first day hearing for three entities, each of one. which is a, as we noted in the papers, a First Lands affiliate,

but we believe this is a separate and distinct and should be a fairly streamlined and hopefully simple case. The three entities that have filed are called Liberty 1B, Liberty 2BV, and Ultanon Motion Holding BV. We have with us today, as noted, on the appearances, Jamie Donath, who is an independent, independent direction, of each of these three entities. When I finish my opening remarks, I would seek to offer Mr. Donuts' declaration into evidence

and his direct testimony in support of the First Day motions, and we'll offer him up for cross-examination to the extent anyone has any questions. I will note that as of this moment, and not surprising, I think, once we get a question, into the substance of what we're requesting here. We have not. We have been in detailed discussions, as would be typical, with the U.S. trustee and appreciate the U.S. trustee's efforts in navigating through our first-day motions, but we have received no third-party formal or informal objection to any of our first-day motions.

We're also joined on the line by Gary Polkowitz of Teneo, who, who is the proposed financial advisor to the debtors, as well as the representative of Kroll, which is the proposed claims agent for the debtors. I want to thank the court for accommodating us for this first day hearing. And again, thank the U.S. trustee for their helping cooperation to getting through the first day motions fairly quickly, a fairly expedited basis.

Just to give you a little background here, these three entities that have filed for bankruptcy today are holding companies of a business line of first brands called Altonon. Altonon is a successor entity to a business that was called LumaLeds. LumaLeds was an aftermarket producer of headlamps for vehicles around the world. world with manufacturing facilities in multiple jurisdictions around the world and had was a big at a big market share in this particular in this particular industry it was a business that in addition to the three holding companies there are 20 some odd operating subsidiaries that operate around the world those those entities are not before your honor and will not be before your honor in this in the bankruptcy

proceedings several of those entities have already commenced insolvency proceedings in their local jurisdictions with likely more to come i'll get back to that in a moment just from a corporate government standpoint but all of those operating subsidiaries that you see on the chart which is attached to this is going on its first day after david um for the declaration um they those are the operating subsidiaries that were that we're talking about. So the Ultanonan business was acquired from Lumillads in 2024. The business was acquired for a purchase price $238 million. At that time, at the time it was acquired, it had EBITDA of 60 some of million

in 2022 and I think 48 million in 2023. It was until fairly recently an operating business, as I said, with manufacturing and sales facilities around the world. As of today, virtually all of those operations have ceased, and we are – Mr. Donath was appointed as inmate. independent director for these entities. The initial appointment was for the two Liberty entities in November of 2025, and then subsequently in early 2026, he was added as the sole independent director of the Holdings entity.

The ultimate election holding entity is the direct 100 percent shareholder of all of those operating subsidiaries that I have mentioned. The debtors do not have any employees or operations. It's a fairly simple capital structure. There is, as Mr. Jensen noted, a secured lending facility, and I'll get into what that means, at the holding company. The principal amount of that facility was used as acquisition financing to acquire the Luminous business. in the first instance. The debt sits at the holding companies,

but has been guaranteed by many of the operating subsidiaries. Some of those guarantees are secured, some are not secured. The assets, I think one point that's important to note, the assets currently of the holding companies at this point is really limited to the equity value in the subsidiaries, of which at this point it looks like it's unclear that there will be any equity value in any of the subsidiaries. I think that will depend on how each of those operating subsidiaries is wound down and whether there is and can be any equity value remaining. There is some cash on hand which will be principally used to fund this case.

And most notably, there are what we believe to be a series of litigation claims, arising out of the notion that this was fully operating business when acquired and less than two years later, it is an insolvent business or the intelligent operating companies where we believe that significant portions of the value of this enterprise have ultimately been transferred out to other parts of first brands and other places. So we believe that there are viable litigation claims here that the holding entities have for the benefit of the creditors of those entities and would like to preserve the value of those claims for the benefit of those creditors.

We have been in discussions. One thing that's important to note is, and the reason we don't have a cash collateral emotion before you're on today, is that while the lenders do have security interest in certain assets, they do not have security interest in the cash on hand at the debtor. So there is no – we've been working with them and coordinating with them as to our cash spend, given the limited amount of cash that's available. But there is no – this is not their cash collateral, nor are we seeking – therefore we don't need to seek use of cash collateral.

The, the, the, so we had been in discussions with, with the lenders about the best course of action here, discussing the notion of the creation of a litigation trust for the benefit of creditors to pursue these causes of action at some point of the future. I think it's important to note, and as you can see from our, you know, cash balance on hand, we do not intend or expect to litigate any of these claims before your honor during this bankruptcy proceeding. This proceeding will all be about in a very near future we intend to file a plan disclosure statement and a litigation trust document that we will be negotiating with our major creditors that would preserve the value of all these claims for subsequent prosecution by the beneficiaries

of that trust. The, I probably, to spend a moment on, a little bit on the, on the, the lending facility and then some of our other creditors and the reason that we are in this proceeding, you know, at this time. So Mr. Jensen, you know, represents the agent and one of the lenders in the facility,

as I said initially this facility was put in place as acquisition financing but during a time period when the debtors were looking to determine whether there were viable sales of the various lines of business including the Eltonon business as we understand it and lot some of this you know pre preceded sort of preceded you know for the chance of involvement but also some of it preceded mr. Donuts involvement as well, but there was a process that was teed up to the first brand debtors professionals to seek to sell the various businesses. And while the ultanon business was cash-strapped, there was various accommodations

and extensions of credit and forbearances entered into by the lenders. As part of that process, the dip lenders, in the main case, funded through a first brand affiliate, a portion of funds that were made available to the Ultiman entities without getting into all the detail. I think it's set forth in our first affidavit, and probably Mr. Jensen can speak more to the details better than I can. But the end result was that this first brand affiliated, Andy, effectively, which reflects the advances of the DIP lenders that the first brand affiliated entity holds currently approximately 75% of the existing lending facility and the DEVA Santander entity owns the remaining 25%.

And again, Mr. Jensen, if I said anything incorrect, you can clarify or correct. In addition to that facility, there are certain trade creditor and service providers at the holding company. Substantially all of those service providers and contract counterparties were for the benefit of our operating companies. In the past several weeks, as cash was dwindling and operations, at the, at our opcos was winding down. We started to receive significant demands on various contracts by various, our contract counter-provided service providers. In addition to, and one of, you know, perhaps the most significant claimants at the

hold, though, is Lumillads itself. They were given how recent this transaction was, Lumillads was still providing transition services to Altonan. They were asserting significant amounts due, and as part of an ongoing discussion with them on very shortened notice, they took action in the Netherlands to freeze one of our significant bank accounts, and once we became aware of that, while we were in the process of preparing for this Chapter 11, we expedited our timeline to file, and we found ourselves in bankruptcy as of the end of last week.

As I noted before, we have not yet – and hope and expectation have been that perhaps we would have even more streamlined a case and would have filed a plan, disclosure statement and litigation trust at all in advance, but unfortunately we weren't able to do that. We wanted to get this case in – take – get advantage – get the advantage of – the global automatic stay to prevent further actions like this from occurring all over the world as against any of our, you know, assets or, you know, cash that's sitting at various accounts. But we will, we intend in the coming weeks, as I said, to file a plan of organization, disclosure statement, and litigation trust agreement with the cooperation of the lender group.

I think maybe I would pause there. I probably forgot something, but I think that you get the gist of what we have here. There's obviously more detail in the First Day Declaration, but I'm happy to answer any questions that Your Honor may have before I move for admission of the Zonath Declaration into evidence. I have no questions. Let me just see if anyone wishes to... make any brief opening remark before we launch into the evidence? I'm happy to speak briefly, Your Honor.

Once again, this is Christian Jensen Sullivan and Cromwell, counsel to Bank of San Bernardian Capital. Mr. Feldman's description is after this. You may recall there was a motion before the court in the first brand case last November to provide for the on-lending of some dip proceeds to the open all business, which included a purchase of a sub-participation in the existing debt that was held by the debit capital, the end result of which there is a 75-25 split between the intercompany lender, KTRI, and debit capital.

The whole super senior incremental facility that was provided in late fall, as well as the original acquisition debt that was remaining. I'll just speak very briefly, Your Honor, at the outset before we get into the motions that, you know, my clients are supportive of the relief requested today, and the broader goal of this, this Chapter 11 proceeding to provide a forum to preserve these litigation claims, which are likely the most significant asset remaining for these businesses and the source of any recovery for creditors. Thank you.

Anyone else? Just briefly, Judge, then Jason Ross for the U.S. trustee. As I was alluded to earlier, we did get a chance to review. all the motions that are filed today and we're able to work through our comments. So you probably won't be hearing much from me. And other than me to confirm that, you know, from my perspective, I think we're all set as far as and don't have any opposition to any of the relief that's being saw today. So unless your honor has any questions, I'll be remaining quiet probably to the rest of the hearing.

Okay. Thank you very much, Mr. Reffman. Anyone else? Let me just check. Okay, let's get into the evidence. Well, actually, Your Honor, one more point that I'm sitting in waiting. I realized I forgot to mention, and this is just, I guess, an FYI. The one motion that we had discussed with Mr. Ruff, and I had mentioned to you that at this point, a handful of the operating subsidiaries have commenced insolvency proceedings around the world.

In order to commence those insolvency proceedings, it requires the sign. of the 100% shareholder, which is this ultimate on motion holding entity. We had initially prepared a motion which would have, I think I would characterize essentially a comfort order that we have the authority in the ordinary course of business to enter into, to sign off on those filings on a go forward basis. Mr. Ruff had an objection to the that relief didn't think it was necessary. You can speak for himself.

I think we agree, frankly, that this is, you know, ordinary course to be able to sign off as 100% shareholder, ordinary course corporate governance action of the holding company. I know – I mention it for two reasons. One, that, you know, that's still an issue that's ongoing where – while the decision to file – whether to file or not to file are being made by the operating company, their boards and, you know, their advisors, they do require as a technical matter of sign-off from the shareholder, and we intend to continue to provide those sign-off, but to the extent there's an issue at any point, you know, we may well come back to your honor on an expedited

basis to seek authority to the extent we think we need it. We don't think we need it, but I want to just flag that for you as a placeholder. Understood. Thank you for the update. Okay. So at this point, I'd like to move into evidence Mr. Donath's declaration in place of his direct testimony. The declaration goes through some of the background information, as I just described, but also will provide the evidentiary support for each of the first-day motions that my colleague, Madeline McEleney, will take the court through. And again, Mr. Donut is available for cross-examination if anyone has any questions on any part of the declaration.

Any objection to the admission of the Donat Declaration for purposes of today's hearing? Okay. It's admitted. Okay, Your Honor, I'm going to shift my seat, otherwise, you know, seed the podium to my colleague, Madeline McElaney, because we're sitting in the conference room, and she'll take it from here. Thank you. All right. Thank you. And let me steal some down there. I just, I could. Council, why don't you make an appearance? I'm going to move your agenda around just a little bit. Just I, go ahead and state your name for the record. Good afternoon, Your Honor.

Madeline McLean, it's the per chance of post-counsel's better. Okay, good afternoon. I wanted to just get comfortable with where we were and to, before I signed joint admin, that I kind of understood the relationship and everything. I get the declaration into evidence. So I'm comfortable with where we are. I'm going to sign while we're talking, join admin. I'm going to designate this as a complex Chapter 11 case,

and I'm going to approve the ex-party application for Kroll. So I'm going to take care of one, two, and three on your agenda while we're talking here. I'm comfortable with where we are, and that I know that they need to be separate. it. And so I'll let you pick whichever one you want after that one, but I'll take care of one, two, and three now. Thank you, Your Honor. I appreciate it. I appreciate the fact that you have just as a joint admin, joint administration motion. We do just want to clarify on the record that the debtors are not seeking to jointly administer these Chapter 11 cases with the larger First Branch Chapter 11 cases, which are being jointly administered before this court as well. You know,

Given the significant interest in the first plans, close cases and the number of parties involved, we just wanted to clear that point to vote in confusion and confirm that these cases are proceeding separately. We just want to take that on the record simply, and thank you for answering those orders. All right. So the first now item on the agenda is agenda item number four,

which is the debtors request for authority to file a consolidated creditor matrix motion and consolidated list of the debtors' 30 largest creditors, as well as to the back personal information of individuals identified in the debtors' filing as well as to seek the approval of a form and manner, a form of notice of no-sign creditors of the commencement of these Chapter 11 cases. The authority to file consolidated a creditor matrix and consolidate a list of the 30-largest unsecured

creditors as compensated by the complex case procedures to alleviate the debtors of the administrative burden of compiling separate creditor list for each of the debtors, limit the associated costs for the debtors have limited cash on hand, and reduce the possibility of duplicative services. Accordingly, the debtors' request authority to file consolidated creditor matrix and consolidated list of the 30 largest creditors all of the debtors here. The debtors have further requested permission to exact potentially identi-personally identifiable information of individuals included in the debtors' filing.

This relief is particularly important here where the debtors operate in the European Union and other countries where applicable law imposes significant constraints on the disclosure of information relating to identified individuals and potentially significant fine for violations. of those authorities. Finally, the better seeks approval of the form and matter of the notice of commencement through broadied to creditors, which is attached to the zip-a to the motion. Unless Your Honor, there's any questions, we respectfully request that the order filed the document number 6-1 be entered.

No, motion granted. Thank you. And so the next item on the agenda is item number five, which the bettors request for entry an order enforcing the automatic stay protections under the bankruptcy code, which is filed at Sackettlement number seven. The debtors are based in Netherlands. Accordingly, many of their creditors and other parties' interests are located in Netherlands and other jurisdictions outside of the United States.

While the debtors do believe that many of their creditors and other parties' interests are subject to the automatic stay, many do not have U.S. operations, and we anticipate that not all parties in interest will be familiar with the global reach and the self-executing nature of the automatic stay. Through this motion in the proposed orders, the debtors are not seeking to bridge or enlarge or otherwise modify the rights of any parties with respect to the next day. As is typical in cases involving foreign debtors and foreign creditors and counterparties, we are seeking entries in order simply confirming and reinforcing the protections of the automatic stay, particularly here where the debtor's creditors have already taken actions against the

debtor's property outside the United States, absent order of the bankruptcy court reinforcing the protections of the automatic stay, the debtors are concerned that parties may tend to take improper action against the debtors and or the property of their state. Therefore, we're seeking entry of an order to ensure all parties in interest are aware of these provisions of the U.S. Bankruptcy Code,

and the debtors believe that the motions as drafted appropriately lay out these key provisions. We did share the motion in the proposed order with the United States trustee, who did not have any objections to the motion or the relief requested here. So accordingly, we respectfully request the order filed the socket number 7-1 be entered.

Does anyone wish to be heard in connection with this motion? Okay, the motion is granted. I think it makes perfect sense in a case like this to grant such relief requested on a and it's really just restating the code and the provisions there. So it makes perfect sense to me. I'll grant the motion. Thank you, Your Honor. So the next item is on the agenda is item number six,

which is the better's motion for entry in order authorizing the debtors to pay pre-petition obligations to certain critical service providers, which is filed as docket number eight. By this motion, the debtors are seeking permission to pay certain pre-petition amounts owed by the debtors to critical service providers and the amount not exceed $15,000. Betters Liberty 1 and Liberty 2 engaged services of a Netherlands-based corporate and financial service provider that performs certain financial reporting services for those debtor entities, as well as a Netherlands-based tax law firm that provides corporate tax filing support. These providers are critical to insurance debtors remaining good standing and in compliance

with the applicable statutory, regulatory, and governance requirements under Dutch law. And absent the engagement of these professionals, there is a risk debtor as a principal has compliance with applicable legal and regulatory requirements. This is a result of potential penalties for the debtors and claims against the states, which would not be in the interest of debtor's stakeholders, particularly where the pre-position amount the case is very limited. And at the outset of this hearing, you know, the debtors and their advisors are failing news to the situations and continue to get our arms around the information.

We limited the relief that we've requested today to what we thought was absolutely necessary at the time of filing based on the information that we had and what was strictly needed for the debtors to get through the first 21 days or so of these cases. We're continuing to review our books and records as well as to engage in communications with our contract counterparties. Based on that, there is the possibility that we may identify additional providers outside of these two that are specifically identified in the motion. And we may seek court authority to make certain pre-position payments account of those critical providers.

We expect that those amounts be similarly very limited, but we just want to flag after the court as well. And so unless Your Honor has any questions, we respectfully reflect that the order filed at docket number 8-1, 8-1 be answered here. I want to wish to be heard in connection with this motion. Okay, the motion's granted. Thank you, Your Honor. So the next item on the agenda is item number seven, which is the debtor's motion for an order

extending the time to file schedules of assets and liabilities as statements of financial affairs, as well as waiving the requirement or on the alternative extending the time to file, Rule 2015 reports, which filed as document number nine. As described in the motion, since the independent director has been appointed late last year and early this year, respect to both entities, we've endeavored to understand the assets and the liabilities at the debtor as well as the operations of the debtors, non-debtors, of the non-debtors subsidiaries. While the debtors are holding companies with no employees and no operations, the ability to access the information necessary to file, to compile the statements about

the liabilities and the statements of financial affairs has been complex, somewhat complicated by the actions of prior management and the current status of sort of the Ultanom business, including limited people remaining within the operations that are familiar with legacy systems systems and historical transactions. While Panea, who's the debtor's advisor, financial advisor, has worked constructively with the personnel at the businesses, as well as Albert and Marcel, who is a financial advisor in the larger first branch, Chapter 11 cases, given the amount of work, you know, in contailed and completing schedules and statements, as well as competing demands on the debtors limited

number of people in Yolson on business, the debtors may not be able to complete the schedules and statements properly and accurately within the required timeframe. Accordingly, the debtors of requesting an extension of the deadline by which the federal will file the schedules of assets of liabilities and statements of financial affairs, through including May 10, 2026, which is 45 days to the petition date, without prejudice with the ability to request further extensions. The U.S. trustee has reviewed the motion prior to the filing and did not have any objections to the request of extension of the time to file with schedules and statements.

Through the motion, the debtors are also seeking a waiver of the requirement to bankruptcy rule of 2015.3. And while the U.S. trustee did not have an objection to the extension of the deadline to file the statements and federal, he did have an objection to the requested waiver to file – the requested waiver of the requirement to file the report set forth in Rule 2015.3. And with full respect to the decision of the United States trustee, the debtors do submit that the posture here is somewhat unique and a waiver is justified under the surface. circumstances. As we say at the outset, the debtors are affiliates of the debtors in the larger

first-brands group, but we are not seeking to have these cases jointly administered. And because the debtors are affiliates of the debtors in the larger first-brands group, as part of the periodic report regarding value, operations, and profitability of entities in which the debtors has stapled a substantial controlling interest, which was filed as document number 1389 in the larger first-brance case in order to comply with the requirements of Rule 2015-3, The debtors in the first branch group, Chapter 11 cases, did include in that periodic report, each of the debtors, as well as each of the 20 non-debtors operating companies that the ultimate-motion holding is the parent company of.

Thus, any 2015 report that is filed in these Chapter 11 cases would contain substantially identical information to the disclosures that were already made in the larger First Branch Groups filing would be of limited the utility to parties in interest and would result in unnecessary duplication of effort and expense. Further, the best source of information for the 2015 reports in these Chapter 11 cases would have been the first branched entities, given the further dissertation of personnel from the Elton on Business, the limited available records, and that many of the entities that would be included in these reports are in Local R or Reading and Solvency Proceedings or preparing to be in

proceedings themselves. And so it's unlikely that the debtors here would be able to provide more accurate or comprehensive information beyond what has already been provided. And while the debtors submit that a waiver is justified under these unique circumstances, the debtors do understand the importance of notifying parties and interests of the disclosures that have been made in the larger first branch group of Chapter 11 cases. And thus provide that notice, the debtors would propose to publish on the website maintained by Kohl, our claims and noticing agent, a link to the periodic report that was filed in the larger

chapter, excuse me, larger first branch, Chapter 11 case, and as well as file a notice on the docket, providing parties and interest with a link to that, filing, as well as the information necessary to access it. Based on these circumstances that better submit that granting the request of waiver coupled with the notice through Kohl appropriately balances the objectives of Rule 2015 with the practical realities of these cases and serve the interest better to states and their creditors. In the alternative, if Your Honor's not prepared to grant a waiver, we would request the same extension of the deadline to file through May 10th, 2026. Okay.

Anyone wish to be heard in connection with this case, with this matter? Yeah. Governor, I know just briefly, I actually thought we had resolved this. What the council just went over there as far as an alternative? I was actually perfectly fine with. I think given the facts and circumstances here, I think what was expressed to me is that it would be very difficult for them to this team to be able to perform the work necessary to independently verify what had already been done in the first branch matters.

And there's very limited resources in this state. So given the very specific facts and circumstances of these cases, I thought, what better what council proposed was was satisfactory and probably you know provided the same amount of information otherwise i think they would have been left with the choice of just listing it and then maybe put noting it the global notes anyway that they're relying on someone else's you know work so i i think what council's proposing to do as far as just making the information easily accessible to predators and other parties and interest in this case actually makes sense. Yeah, I thought that made a lot of sense, too.

And I do like putting it on the website, just linking it. So if someone wanted to see it, that just made a lot of sense to me. So I know Mr. Ruff is probably right. This may be the only case in which I preside over during my tenure here, in which I'll grant a waiver on the first day. but this one just makes a lot of sense and understanding. It's just a really, really unique fact set. I think I'm going to grant the relief requested here in the motion.

Just ask that you put kind of whatever reports are there, in the first Brown's case, just kind of link them up so that someone wanted to see them. They could see them here. But, Your Honor, we'll do that. So one question for you, is the order that, You'd be asking me to sign, do I need to sign something different? Or can I just sign the proposed order? And I'm more than, I don't need to order you to put it on the website.

But as long as it doesn't conflict with anything that we're doing now, I think I'm fine signing the order. So the order provides for a waiver. It does not explicitly go into the sort of proposed noticing through poll. We're happy to upload a revised form of order for what we prefer or otherwise. wise. Yeah, let's just, it's on the record. I'll sign the order. We all know what I'm, we all know what I'm doing.

We can just, just get it, as long as that link is there, then I'm considering it satisfied. Okay. Thank you, I will work with pull to get that up as soon as possible. And so the next and final item on the agenda is number eight, which is the better's motion for continued use of the debtor's cash management system, which is filed at docket number 10. Through this motion, the debtors are requesting authority continue their sufficient cash management system in the ordinary courts, including maintaining increasing bank accounts, engaging the services of non-debtor affiliates in ordinary

courts, paying certain precision obligations and an extension of the time to comply with Section 345B to bankruptcy code. Before the commencement of these cases, the debtors operated as part of a cash pooling system where monies were swept up from two ultramed motion holding and paid down to the the non-dare subsidiaries that make up the alternate business to fund the operating clock of those entities. But the debtor's understanding is that cash billing system has largely been shut down at the beginning of this year.

Today in the ordinary course of business, the better is utilized an integrated cash management system that enables a better to monitor the collection and dispersement of flows as appropriate and maintain control of the administration of their bank accounts. As step-in-the-motion, the veterans maintained 22 bank accounts across five banks. The majority of the debtors cash is held in the debtor's primary operating account has been used to make vendor disbursements as well as advanced funds of their operating entities. Fifteen of the debtors accounts are currently located in non-authorized depositories.

We discussed this with the United States trustee and understand that the Office of the United States trustee does not object to a 45-day extension for the debtors to come in compliance with their requirements of Section 345B is bankruptcy code without prejudice to seek further extensions. Through this motion, the debtors are also seeking permission to, in their discretion, continue a relationship with a non-debtor affiliate called GOC Automated Malaysia, which provides certain back office and finance support to the debtors at a cost of about $5,000 per month. The debtors submit that maintaining such service and relationships critical for the debtor's transition to the Chapter 11 cases and to preserving these state assets for the

benefits for creditors, as the back office service provides much of the finance reports that goes in preparing, sort of reporting and as well as facilitating the payments necessary for the debtors to continue their operations. The debtors are also seeking authority to establish professional fee escrow account and related to professional fee procedures. The debtors have designated one of their bank accounts at J.C. Morgan Chase has a segregated account to hold budget of professional expenses in these Chapter 11 cases. as well as fees the flyer seat paid to the clerk of the court and the United States trust fee.

Through this motion, the debtors are seeking authorization to fund that account on a loosey basis each Friday, pursuant to the budget, which is attached as a Zibbit D to the cash management motion, which is also included as a divot number six on a witness and a pivot list. The budget in this case is very thin and cash is very limited. As it flows in the cash management motion, the betters only have about $3.4 million of cash on hand, and as of today, portion of that fits in a blocked account. And the budget for these better professionals is therefore very modest. While the professional for the escrow account is not intended to be functioned as a cap

on a lot of professional fees or expenses, it is meant to provide professionals in these cases with a limited and reasonable protection under the circumstances. We've shared the task management motion in proposed order with the United States' trustee, but the minor comments to the proposed order that we've implemented in the versions filed on the docket at 101 and 2. We further provided the office of the NITRSTC with some information requested with respect to the debtors' bank accounts. And so unless your Honor has any questions, we respectfully submit that the court entered the interim cash management order, filed as docket number 10.10-1.

Okay. Everything makes sense to me. I'm going to grant interim approval of the cash management motion. This is just to allow the debtor. to ease into the Chapter 11 process. And I think what we need to, when do you want to come back for a final hearing? So we think that the week of April 27th, subject to your honor's availability, would work for a second day hearing?

Let's see. Let me ask, are you planning on filing anything else that week to kind of go in? The reason I'm asking is it's going to have to be a virtual only hearing. I'm going to be out of town. I can get you in. But we can just do it. Let's see. Do you think we could do?

And obviously, if there's no objection to any of this on a final basis, why don't we do this? If there's no objection, just file a C&L. But why don't we do April 27th at 3 p.m. Central? And then we'll do the objection deadline. Let me just give folks as much time as possible. Give them April 22nd. And then if there's no objections, just file a CNO.

I'll take care of it. Okay. Thank you, Your Honor. Hold on a second. Let me fill this in so I don't forget. But it's going to be a virtual only hearing. I'm going to put April 22nd at 4 p.m. Central. That's the objection deadline. Okay.

That is going to be signed and it'll hit the docket today. Is there anything else we need to take care of today? That's it for much. That's it for much, Your Honor, unless you have any further questions for us, nothing further for us today. Thank you, again, Your Honor and your chambers for accommodating us. All right, folks, thank you very much. Have a good afternoon.

Thank you. Thank you.