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EBW Credit Bid Acquisition
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SRZ represented a hedge fund in its credit-bid purchase of Everything But Water, a leading retailer of women’s swimwear and resort apparel. Judge Mary Walrath of the U.S. Bankruptcy Court in Delaware approved the sale of the assets on May 1, 2009. The hedge fund, a prepetition secured creditor of the debtors, provided DIP financing and agreed to act as the so-called “stalking horse” bidder in a sale of substantially all of the debtors’ assets. Despite numerous objections from the creditors’ committee and a contested sale hearing, we negotiated and closed a sale of the debtors’ assets in 54 days. We assisted in structuring the asset sale process, including creating a holding company that bid for the assets, negotiating an asset purchase agreement with the debtors, evaluating the tax implications associated with the purchase, evaluating employee retention and termination issues, and analyzing over 70 store leases. The creditors’ committee has appealed the sale and continues to challenge the hedge fund's credit bid. We are also representing the hedge fund in post-sale litigation and appeals.
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