Category Archives: Bankruptcy

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Less than 24 hours after the Treasury Department formally extended cash grant offers to the six largest airlines in the U.S., the union representing 120,000 flight attendants is blasting the move with a dire warning.

"This will lead to airline bankruptcies," said Sara Nelson, president of the Association of Flight Attendants union. "The Treasury Department is destabilizing the industry, not helping save it."

Nelson's anger is fueled by the Treasury Department deciding to make30% of each cash grant offer a low interest loan payable to the federal government.

That move, which caught many airline executives by surprise, means the $25 billion approved by Congress for immediate cash grants will actually be$17.5 billion. The other $7.5 billion will now be loans airlines will be required to re-pay.

"This is not what Congress approved," said one industry executive who asked not to be identified given the ongoing discussions between airlines and the Treasury Department. "The aid was supposed to be $25 billion in cash grants and $25 billion in loans."

While Congress may have intended for $25 billion in immediate cash assistance to be money airlines would not have to re-pay,the CARES Act gaveTreasury Secretary Steven Mnuchin the latitude to set terms and conditions for the cash grants.

"It is our objective to make sure, as I have said, that this is not a bailout, but to make sure that airlines have the liquidity to keep their workers in place," Mnuchin told CNBC on Thursday as the Treasury Department was finalizing the grant offers.

When the offers came on Friday, they included the stipulation airlines accepting grants not lay off employees before September 30th, a requirement all carriers have already committed to meeting. Still,executives at multiple airlines told CNBC they were surprised by the loan component in the grants. They say it meansTreasury will award just over half of the money they requested to cover their payrolls for the next six months.

When airlines submitted their grant applications, they included Form 41 documents which are filed regularly with the Department of Transportation detailing payroll obligations. For the industry, the total payroll obligations April 1st through September 30th is approximately $31 Billion. If Treasury awarded $25 Billion in immediate cash, it would cover 80% of airline payroll needs. The Treasury Department's current plan to award $17.5 Billion in cash grants covers 56% of the $31 billion the airlines requested.

Nelson says reducing the immediate cash amount airlines will not have to repay amounts to Treasury taking money Congress earmarked to immediately pay airline workers and turning it into a loan airlines may opt not to take. Nelson and her team spent Friday trying to reach members of the a Treasury Department to discuss Secretary Mnuchin's plan for awarding grants. "We have called, we have sent e-mails, but there has been no conversation with Treasury," she said.

The leadership teams of airlines have spent much of the weekend discussing whether or not to take the grants. "It's starting to not be worth it," a senior airline executive told CNBC when asked if they would accept the cash grant. "I could see airlines just laying people off because it's cheaper."

Critics of the $50 billion airline bailout say U.S. carriers should not receive cash grants from the federal government and should instead restructure in bankruptcy or borrow billions more in order to have the liquidity needed to withstand the the rapid drop in business.

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'This will lead to airline bankruptcies' flight attendant union furious with Treasury bailout offers - CNBC

The Swiss government announced Thursday that it will look at temporarily amending its bankruptcy laws during the coronavirus crisis to help companies that have encountered cash-flow problems and mounting debt.

The government warned on Wednesday that the Swiss economy could shrink as much as 10.4 percent this year. Justice minister Karin Keller-Sutter said that companies that were previously safe are now being threatened.

The measures are meant to help companies hurt by coronavirus over the hump, but not to keep failing operations on life support. The measures are also meant to help Switzerlands exporters, which are being impacted due to a failing demand from other countries.

The government said that a halt on debt collections and a court holiday would end on April 19, and that it would look at moving civil court proceedings to a teleconference platform to maintain the operation of the justice system.

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Switzerland to amend bankruptcy laws to aid companies during COVID-19 pandemic - JURIST

All Chinese businesses, large and small, have struggled since COVID-19 emerged at the beginning of this year, forcing stores, restaurants, and factories to cut down on hours or completely shutter. While the full economic impact of the outbreak on Chinas economy is still uncertain, popular business writer W Xiob detailed in a recent report that about 247,000 Chinese companies declared bankruptcy in the first two months of 2020.

Wu Xiaobos financial blog revealed(in Chinese)that Guangdong was the most impacted province, with over 30,000 firms going out of business in January and February, followed by Shandong, Jiangsu, Sichuan, and Zhejiang.

The observation echoes a string of previous surveys showing many Chinese companies, especially small businesses, feeling the pinch as the pandemic brought consumer activity to a halt. Almost 36% of the private-owned firms that responded to a survey conducted by Tsinghua University in February said that they were hammered by the economic fallout from the outbreak and did not expect to survive after a month. In another survey released in February, more than 60% of the small and medium-sized enterprises in Shandong said that they could only hold out for a maximum of three months under current conditions.

Unsurprisingly, Wu also noted that new companies were the most vulnerable businesses affected by the crisis. Of the companies that pulled the plug in January and February, roughly 55% were startups under three years old.

When it comes to specific sectors, Wu says that companies in the hospitality and retail industry have been going through a particularly rough time because people were advised to practice social distancing and avoid public places. This is in line with a report released by China Chain Store and Franchise Association (CCFA) about two months ago, which showed that retail shops in China were experiencing a 50% sales drop, with restaurants making only 30% of their normal profits. Other sectors that were seriously impacted by the knock-on effect of the outbreak include rental services, construction, and farming.

While the pandemic is devastating to most companies, some businesses have been thriving in the crisis. According to business data platform Tianyancha(in Chinese), since February, more than 28,000 companies across China have expanded their scope to include healthcare-related services and the manufacture of medical equipment such as thermometers and masks. Internet-based firms have also seized the opportunity to grow as people face a new reality in which online classes and virtual meetings have become the norm.

Wus report also notes that given the large-scale closure of government offices in January and February, a considerable number of companies in serious financial trouble were unable to file for bankruptcy. As China slowly grinds back into activity starting this month, the report predicts that more bankruptcy applications will go through in the next two months and more companies will officially go out of business.

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More than 240,000 Chinese companies declare bankruptcy in the first two months of 2020 - SupChina

More than a million Canadians believe they are on the verge of having to declare bankruptcy, according to the findings of a new poll released Thursday.

The survey conducted by DART & maru/Blue found an even larger group 4.2 million Canadian adults said they consider themselves to be heading towards bankruptcy over the next three months unless their personal financial conditions improve.

Middle-aged and younger Canadians with middle-to-lower incomes appear most vulnerable to bankruptcy, the survey found.

This will be the next wave that we will have to keep a close eye on over the next couple of months

This middle-age, middle-income group is going to get hammered the hardest with the reduction of jobs and lost income, said John Wright, a partner at DART.

This will be the next wave that we will have to keep a close eye on over the next couple of months.

He said his groups polling from the outset of the pandemic crisis in North America has consistently shown that between four and five per cent of the Canadian population believes themselves to be in either dire or desperate circumstances over the next three months.

Geographically, people who consider themselves headed towards bankruptcy in the short-term are most likely to be found in Alberta, Saskatchewan and Manitoba, the survey released Thursday found. This is perhaps not surprising, given that western Canada has been hit by a second economic shock from low oil prices at the same time as the economy ground to a near halt.

With the widespread shutdowns of non-essential businesses halting or crimping paycheques across the country, and government aid just beginning to roll out, many financial institutions have made concessions for their customers during the COVID-19 outbreak. This has included allowing many to defer payments on personal loans including mortgages and credit cards.

Nevertheless, the survey found almost one in 10 primary residence mortgage holders believe default is imminent over the next three months.

After examining their current financial situation over the next three months including all government measures to support them and their home ownership including payment deferrals eight per cent affirm they wont be able to pay the mortgage and will begin to default without greater help, the survey found.

A small fraction of those believe they will have to sell their house because they wont be able to cover any loans.

The poll was released as new unemployment figures showed that Canada lost over one million jobs in March, the largest monthly employment decline ever.

Wright said the unemployment numbers released Thursday are the thin edge of the wedge as cascading effects of the clampdown have yet to emerge in official figures.

I suspect that we will see a widespread increase in these numbers and in bankruptcies, and in (defaults on) mortgages over the next 30 to 60 days, he said. Thats the simple math of how much income people have and how much debt they are carrying.

He added that the number of such financial casualties could increase over the next year, with Prime Minister Justin Trudeau indicating Thursday that restrictions, in some form, could remain in place for a year or more while a vaccine against COVID-19 is developed and made available.

The Dart survey was conducted April 1 and 2 among 3,030 Canadian adults randomly selected from maru/BLUEs online panel. A subset of more than 1,000 who own a primary residence with a mortgage were surveyed, with results of that sub-sample considered accurate to within 3.4 percentage points. The results were weighted by education, age, gender, and region to match the Canadian population, according to Census data.

Email: bshecter@nationalpost.com | Twitter:

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More than a million Canadians believe they are on verge of bankruptcy, new poll suggests - Financial Post

Law360, London (April 9, 2020, 6:59 PM BST) -- A London judge on Thursday paused extraordinary bankruptcy proceedings against an Indian magnate facing extradition from the U.K. on fraud charges, saying he has to be given a chance to settle his 1.05 billion ($1.3 billion) debt with several banks in India.

High Court Judge Michael Briggs adjourned the banks effort to bankrupt Vijay Mallya as a prelude to seizing his assets in the U.K., ruling that theyre trying to claw back their debts even though the businessman has launched a number of legal fights in India.

One of those challenges could see Indias Supreme Court produce a settlement between Mallyas...

In the legal profession, information is the key to success. You have to know whats happening with clients, competitors, practice areas, and industries. Law360 provides the intelligence you need to remain an expert and beat the competition.

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Beer Tycoon Delays Bankruptcy As Bank Fight Turns To India - Law360

Alaskan airline RavnAir's decision to file for bankruptcy Sunday is expected to delay the ability for remote communities in the state to be tested for COVID-19.

RavnAir, which operated RavnAir Alaska, PenAir and RavnAir Connect, announced its bankruptcy Sunday in a statement, saying it lost 90 percent of its revenue from passengers due to traveling concerns associated with the coronavirus. The airline had canceled all flights indefinitely last week.

The Yukon-Kuskokwim Health Corp. (YKHC), which operates a hospital in Bethel and clinics in 48 surrounding villages, planned to start village-based testing last week, before the airlines announcement, Anchorage Daily News reported.

But spokeswoman Tiffany Zulkosky told The Hill in a statement that none of the communities served by the corporation are accessible by road, and 18 are left without any scheduled passenger or cargo service at this time.

Lack of regularly scheduled passenger and cargo service threatens the life and well-being of thousands of Alaskans, while also endangering a delicate supply chain including the movement of lab samples (like COVID-19 testing kits, blood draws), delivery of chronic medications, personal protective equipment, and much more, she said.

Without RavnAir Group, the health corporation cannot deliver fragile medications like insulin and cannot retrieve medical samples before they expire. Zulkosky said it is chartering flights to move patients and supplies in high need circumstances but acknowledged it is not a long-term solution.

YKHC President and CEO Dan Winkelman cautioned in a statement that If a large COVID-19 surge happens simultaneously in numerous villages, our health system will be overwhelmed.

Moreover, under a worse case scenario, even with National Guard support, there will likely not be timely medevacs for all patients and people would die, he added.

The first coronavirus case was identified in Bethel on Monday as the Alaska Native Tribal Health Consortium works to send out 2,400 COVID-19 test kits and 40 rapid testing machines, each with 48 test kits, to the states rural communities.

The supplies will be given to tribal health organizations like YKHC for distribution, according to Anchorage Daily News. YKHC is slated to receive four machines but will struggle reaching its communities.

The airline was a main source of transportation for passengers, freight and mail to 115 rural Alaska communities, Anchorage Daily News reported.

RavnAir Group cited its need for additional funding as reasoning to ground its 72 planes last week in its Sunday statement. All employees were laid off until the company is in a position to cover the costs of rehiring, resuming flights and operating to the many communities it serves through our state.

Meanwhile, other airlines such as Grant Aviation, Ryan Air and Yute are trying to provide minimum service to communities previously only accessible by RavnAir Group, which reduces the number of flights in other communities in the state.

YKHC spokeswomanZulkosky said it could take several weeks or a month for these airlines to fill in the gaps.

Alaska Gov. Mike Dunleavy (R) banned all nonessential travel in the state and issued a stay-at-home order at the end of March. The state has confirmed 226 coronavirus cases, leading to 27 hospitalizations and seven deaths so far.

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Alaskan airline's bankruptcy expected to delay testing, treatment for remote communities | TheHill - The Hill

Enacted March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) places short-term obligations and restrictions on lenders and servicers of federally backed loans. As part of these limitations due to Coronavirus Disease 2019 (COVID-19), lenders and servicers are temporarily subject to moratoriums on foreclosures, mandatory forbearance obligations, and revised credit reporting obligations. For borrowers currently in bankruptcy or who received a discharge but retained real property and continued making payments thereon, lenders and servicers should proceed with caution to minimize their risk of violating the Bankruptcy Code. This GT Alert outlines the obligations created by the CARES Act, identifies some potential litigation concerns, and discusses certain considerations for minimizing risk of exposure.

Key Provisions of the CARES Act

While the CARES Act provides relief to a wide swath of industries, companies, and individuals, there are two overarching considerations relevant to borrowers and the Bankruptcy Code.1First, the CARES Act makes three significant revisions to the Bankruptcy Code:

Increasing the cap for small business debtors seeking relief pursuant to the Small Business Reorganization Act under Subchapter 5 of the Bankruptcy Code from approximately $2.7 million to $7.5 million.

Removing COVID-19-related relief payments from calculations of (a) a debtors income for determining eligibility for Chapter 7 and Chapter 13 relief and (b) a debtors disposable income for a Chapter 13 Plan.

Permitting a Chapter 13 debtor with a confirmed Plan to modify the Plan based on material financial hardship resulting directly or indirectly from the COVID-19 pandemic, including extending payments under the Plan up to seven years after the debtors initial Plan payment was due.

Second, lenders and servicers dealing with consumer borrowers subject to the Bankruptcy Code, in addition to the automatic stay applicable under section 362 of the Bankruptcy Code during pending bankruptcy proceedings, should be aware of the following provisions of the CARES Act: (i) the moratorium on foreclosures and foreclosure-related evictions for federally-backed mortgages; (ii) the mandate for short-term forbearance accommodations for federally-backed mortgages; (iii) the suspension of GAAP requirements to permit loan modifications without designating a loan as a troubled debt restructuring; and (iv) revisions to Fair Credit Reporting Act (FCRA) obligations. For more in-depth discussions of these provisions under the CARES Act, please see ourApril 2 GT Alert on the Mortgage Foreclosure Moratoriumand ourApril 9 GT Alert on CARES Act and the FCRA. In addition, lenders and servicers should keep abreast of additional state-issued COVID-19 mandates, prohibitions, regulations, and guidelines for any state in which they service debts.

Potential Bankruptcy Issues

Because the CARES Act does not explicitly address the interplay between its statutory provisions and the Bankruptcy Code, lenders and servicers may wish to evaluate the status of borrowers and loans subject to the Bankruptcy Code. There are three general categories of debtors that warrant consideration given the requirements of the CARES Act:

Debtors that recently filed bankruptcy and request an accommodation when no Plan has been proposed or confirmed;

Debtors that are operating under a confirmed Chapter 11 or Chapter 13 Plan, and either become delinquent under the Plan or request an accommodation; and

Debtors who have received a discharge of their personal liability for a mortgage debt but elected to retain the subject property2and continue making monthly payments, and have either become delinquent or request an accommodation.

For borrowers that recently filed for bankruptcy, the CARES Act does not prohibit a post-petition request for an accommodation. Thus, lenders and servicers should be aware of any contact from debtors or their counsel seeking an accommodation pursuant to the CARES Act. At the same time, lenders and servicers should remain cognizant that any accommodations under the CARES Act are temporary in nature. Thus, negotiations of any Plan treatment or other post-petition payment terms that will extend beyond the expiration of the applicable stimulus provisions of the CARES Act should address how the terms will change after the temporary statutory benefits expire.

For borrowers operating under a confirmed Plan, lenders and servicers should be aware that debtors are entitled to request accommodations under the CARES Act and that Chapter 13 debtors are additionally able to seek modifications to their Plan extending payments up to seven years after the first payment was due under the Plan. This right to modification is provided to the debtor and does not require consent of the creditor, though requested modification must still comply with the requirements of sections 1322(a), 1322(b), and 1323(c) of the Bankruptcy Code.

For borrowers that have already received a discharge of their personal liability but retained real property subject to a security interest, lenders and servicers should recognize that the CARES Act extends to payment obligations generally, not just those that constitute personal liabilities. Post-discharge borrowers may, therefore, still request an accommodation, and lenders and servicers should follow the same protocol in granting accommodations and forbearances, as they would for borrowers still obligated under a promissory note.

Finally, as to borrowers in the second and third categories, lenders and servicers should be careful before filing any pleadings suggesting a default under a confirmed Plan or sending any pre-foreclosure notices until the expiration of the current foreclosure moratorium. Making any such filings or sending any such notices during the pendency of the moratorium period could be construed by a Bankruptcy Court as initiating a foreclosure process, which, in turn, could subject the lender or servicer to the risk of potential sanctions to the extent the Bankruptcy Court retains jurisdiction over any dispute. Further, for any property believed to be abandoned or vacant, lenders and servicers should confirm that status before proceeding with any foreclosure activity.

1All three of these revisions are temporary and will expire on March 27, 2021.

2Under the CARES Act, the foreclosure moratorium does not apply to abandoned or vacant property.

2020 Greenberg Traurig, LLP. All rights reserved.

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Bankruptcy and Mortgage Servicing with CARES Act - The National Law Review

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Heartland Regional Medical Center

MARION Quorum Health Corporation, which owns Heartland Regional Medical Center and 22 other community hospitals across the country, announced Tuesday it filed for bankruptcy.

According to a statement posted to the companys website, Quorum Health filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.

According to a news release from Heartland Regional Medical Center, the hospital is unaffected by the restructuring and remains open and available to provide care to patients. Hospital employees will continue to receive their wages and benefits for the work they perform, and patients and families should experience the same care that exists today.

This decision comes at a critical time when all hospitals are facing unprecedented challenges related to the coronavirus pandemic, Ed Cunningham, chief executive officer of Heartland Regional Medical Center, said. This is an important step toward long-term financial stability and will ensure that our hospital has the resources and cash flow needed to address the COVID-19 crisis and continue caring for patients and the community.

Quorum CEO Bob Fish said in the companys statement that the company has been transparent about the need to reduce its debt and its interest rate.

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Heartland Regional Medical Center says operations unaffected by parent company's bankruptcy filing - The Southern

In the wake of a S&P Global report that forecasted AMC Entertainments depletion of cash by mid-summer and its potential inability to re-open by June, media reports have already written the chains obituary.

But hold on one moment.

While distribution and rival exhibition sources wouldnt be shocked if AMC files Chapter 11 in the near future, thats not necessarily a scarlet letter for the biggest theater chain in the world. Rather its the best thing that could happen for AMC which is saddled with $4.9 billion debt and currently valued at $327.3M. Last Wednesday, the Wall Street Journal reported that lenders for the Leawood, KS-based chain have hired law firm Gibson, Dunn & Crutcher LLP for advice on expected restructuring negotiations.

Also, should AMC file for bankruptcy, that doesnt mean that theatrical exhibition and moviegoing is dead. AMC can still re-open under Chapter 11 according to sources and thats because studios and distributors are likely to be deemed by a bankruptcy court as critical vendors. In bankruptcy lingo, a critical vendor is one witha specialized skillset, mandatory safety certification or proprietary product whose discontinuation of service would have a significant negative impact on a debtors operations.

Explained in laymans terms, movies from studios are the primary means by which AMC makes money, before popcorn or Coca-Cola. AMC on average reps 20%-25% of a wide releases opening weekend gross, or up to 30% on a great weekend. While an attrition in AMC locations is to be expected, studio distribution heads arent anticipating the chains demise. In fact, we hear AMC is already reaching out to find out what catalog titles are available from the majors for an anticipated May re-opening. Exactly where AMC reopens its 630 U.S. locations remains a question at this point in time. Should New York city, which is currently battling over 76K COVID-19 cases, continue to have cinemas closed throughout the summer, we understand that the majors would likely forgo the opening of an event title under such circumstances.

Who gets hurt the most here in an AMC bankruptcy equation are landlords. According to AMCs 10-K, the chain leases 875 theaters (10,1k screens) and owns or partially owns 62 theaters (561 screens) worldwide. Stateside, AMC manages or has a partial interest in seven theatres and 73 screens. Sources further inform us that landlords arent typically high up on the debtor food chain, like studios are, and in such cases AMC would go in an either renegotiate or shed leases. In such cases, mall landlords would likely re-negotiate terms given how cinemas spur foot traffic to other neighboring retail establishments and restaurants.

Already, AMC is sending a note around to landlords that theyre ceasing to pay rent effective this month (you can read that note from AMCs SVP of Development and International, David Ellis here). In the letter, AMC notes that theyve furloughed 25K employees, instituted a reduced pay program for general theatre managers, placing a hold on discretionary expenditures and making pay/employee cuts at their corporate headquarters in an effort to re-open as soon as its safe to do so. AMC also informs their landlords that they intend to advocate at the federal level for appropriate relief for the theatre and exhibition industries. Its not clear yet how much AMC or other big circuits will cash in from the $2 trillion relief bill passed by Congress, though businesses with under 500 employees look to have an edge.

In the states, distribution bosses expect AMCs roughly 200 Classic Theatres which were former Carmike venues to be a logical casualty in the chains attrition of locations. Many of these theaters are $1 theaters, and arent big revenue generators. Ever since AMC paid $1.2 billion for Carmike back in 2016, the former Columbus, GA circuits locations have been an albatross around AMCs neck.

Last week, S&P Global lowered AMCs credit rating with a negative outlook, reflecting our expectation that there could be a liquidity shortfall within the next six months absent some form of incremental financing. It also reflects the potential for a distressed debt exchange over the next six months, which we would view as akin to a default. AMCs junior bonds traded last Wednesday at 40 cents on the dollar, down from 80 cents at the start of March per MarketAxess.

Back in the 1999-2001 period, several exhibitors simultaneously declared bankruptcy including Regal, Carmike Cinemas (then No. 3 chain), Loews Cineplex (then No. 4), United Artists (then No. 6), General Cinema, Edwards Theatres, Mann Theatres, Dickinson Theatres and Silver Cinemas. In short, they expanded too fast. One of the big outcomes saw Regal absorbing Edwards and United Theaters while Loews merged with AMC in 2006. The consolidation continued, seeing Regal swallowed up by Cineworld of the U.K. and AMC acquired by Dalian Walda of China.

Yet throughout exhibitions bankruptcy stretch during the early part of the millennium, studio sources tell Deadline: They werent burned.

An AMC representative didnt respond Tuesday to a request for comment for this piece.

Below is AMCs letter to landlords:

Dear Landlord:

This letter is to formally advise you that AMC temporarily suspended operation of all of its theatres in the United States (including the theatre referenced above) on March 17, 2020 in response to circumstances beyond AMCs control and specifically the COVID-19 pandemic and the national state of emergency declared by the President of the United States on March 13, 2020, and in compliance with various federal, state and local government mandates and directives (including those that now limit public gatherings to no more than 10 people and emphasize social distancing). All other major theatre operators in the United States have also closed their theatres.

As the crisis unfolded and movie studios pulled major new releases (significantly reducing film product), AMC took steps to adapt and remain open. AMC proactively reduced capacity by 50% per the initial CDC guidelines, and then to 50 persons per auditorium per revised CDC. Some of the steps AMC has implemented are: (a) making the very difficult decision to furlough over 25,000 employees in the United States, (b) instituting a reduced pay program for theatre General Managers, (c) placing a hold on discretionary capital expenditures, and (d) making significant cost and personnel cuts at AMCs corporate offices.

The final step AMC is currently taking directly impacts you. Without revenue from its theatres, AMC will cease paying rent and charges under the lease effective as of April, 2020.

AMC asks for your patience and understanding during this difficult time. AMC intends to reopen its theatres as soon as possible after it is safe to do so. AMC looks forward to getting back to business as usual.

AMC intends to advocate at the federal level for appropriate relief for the theatre exhibition and real estate industries. AMC is willing to discuss with you any suggestions you may have for getting through this crisis and planning for when AMC can reopen and pay rent.

Sincerely,

AMERICAN MULTI-CINEMA, INC.

Daniel E. Ellis

Senior Vice-President, Development & International

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AMC Theatres Bankruptcy Rumors Grow, But That Move Wouldnt Be The End Of The Chain Or The Biz - Deadline

BISMARCK, N.D. - The impacts of the pandemic have forced many into financial hardship.

Because of this, lawyers say they're getting ready for an influx of clients.

Local lawyers say their expertise and experience could save you time and frustration during an already volatile situation.

The novel coronavirus has brought with it unemployment, medical expenses and overextended credit: three factors common among people considering filing for bankruptcy.

Lawyers say many people might be turning to them for solutions in the near future.

"I am probably expecting an increase and a lot more calls about bankruptcy. A lot of people just calling for information to see whether bankruptcy is a possibility for them," said Attorney Chad Anderson of Chad Anderson Law Firm in Bismarck.

Anderson says lawyers can help people navigate through alternatives to bankruptcy or help choose which type of bankruptcy to file.

He says they can guide you on a path toward healthy credit after the process is complete.

While there's no immediate spike in local bankruptcy filings, data firm BankruptcyData reports about 200 more cases of Chapter 11 filings through March of this year than in 2019.

The federal stimulus package is also geared toward an uptick of bankruptcies by offering relief to those who file.

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Bankruptcy lawyers expect and increase of filings - KFYR-TV