Following a series of postponements, Celsius Network, LLC alongside some of its affiliates serving as debtors and debtors in possession, popularly referred to as the “Debtors” or “Company” or “Celsius”, filed a disclosure statement on June 27th. The disclosure is primarily intended to inform creditors and additional interested parties with regard to the intended ‘Joint Chapter 11 Plan of Reorganization’ envisaged by Celsius Network LLC and its Debtor Affiliates. This plan will, of course, have significant implications for the company in the near future, including its capacity to handle debts.
As suggested by its name, this Joint Chapter 11 Plan of Reorganization forms part of the Chapter 11 bankruptcy process in American law. Chapter 11 essentially allows a debtor corporation to reorganize its business with the overarching objectives to maximize the return to its creditors and to keep its business alive.
Upon filing the Chapter 11 plan, the company home to the debtor is provided an exclusive four months period to propose a reorganization plan. This period could be at the discretion of the court extended to up to 18 months. Afterwards, the creditors can propose a plan. Should the plan proposed be accepted by the creditors and subsequently confirmed by the court, the debtor company is able to carry on its business, but remain subject to the oversight of the court.
Reports indicate that the Debtors are represented by Polsinelli, a reputable law firm in the US known for its practical approach towards legal challenges in the market. Polsinelli’s involvement will without doubt bring a measure of assurance to the proceedings.
More specific details regarding Celsius’ Chapter 11 Plan of Reorganization could be found in the official statement released by the company. It remains to be seen how this reorganization will impact all those with a stake in the operations of Celsius Network.