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Article Date: May 2017
Word Count: 195

Payless DIP Order Approved, Reserving Unsecured Creditor Rights on $350 Million Claim

Unsecured creditors negotiated language in the DIP order that preserves potential claims for fraudulent transfer and illegal dividend on two recapitalizations of Payless in 2013 and 2014 that put $350 million into the pockets of the equity holders, a claim that it believes may lead to a substantial recovery for unsecured creditors. They also got agreements to include vendor payments post-petition into the budget and will pay some $20-25 million in stub rent claims to landlords. The 389 stores that are closing will get paid stub rent immediately, and stores that remain open after the reorganization will ... Log in to view full article.


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