A bankruptcy court judge in Delaware approved several interim measures today that will allow The Weinstein Company to continue to meet payroll and maintain business operations as it works through the sale of its film and television assets.
Judge Mary Walrath granted what are known as “first day” applications that accompany a Chapter 11 bankruptcy filing, which are designed to minimize the adverse effects of the proceeding until a company’s assets can be sold. She also agreed to an accelerated bidding process for the sale of the studio’s assets.
The company filed Chapter 11 paperwork Monday night. The company has entered a “stalking horse” agreement to sell substantially all of its assets to the Dallas-based investment firm Lantern Capital, though it must also entertain other bids.
Walrath wrote that “the relief requested is necessary to avoid immediate and irreparable harm.” She scheduled an April 6 hearing date to consider a motion outlining the bidding procedure, and another hearing for April 19.
The judge allowed TWC to pay its 85 full-time employees and 12 independent contractors, so long as no individual employee receives a payment in excess of $12,850. She capped total payments at $819,080, an amount that should carry the payroll through April 19. Walrath also set certain parameters to allow TWC to continue using its existing bank accounts for normal business operations until April 19, and authorized the company to hire Epiq Bankruptcy Solutions as its claims and noticing agent.
The court approved debtor-in-possession loan of up to $25 million for The Weinstein Company — $7.5 million of which would be available on an immediate, emergency basis to provide the needed working capital for a studio to maintain relationships with vendors, suppliers and distributors and pay its employees.
Finally, Walrath agreed to jointly administer the bankruptcy filings for the 55 limited liability corporations the company established to finance individual film and television projects, such as The Untouchable SPV created for the film The Upside.
“As a multi-dimensional company, the affairs of (The Weinstein Co.) are very complex,” wrote Robert Del Genio, the company’s chief restructuring officer in a court document. “The company consists of numerous separate entities for many individual projects and assets. The financing for these individual projects and assets, consisting of corporate-level and project-level debt, is also complex.”
Some 30 people attended the hearing in Wilmington, DE today including representatives of the DGA, WGA and SAG-AFTRA; Viacom; A&E Network; and various financial institutions.