Good afternoon, counsel. This is Judge Horan.
We're on the record in Realist Technology, case
26 -10371. I want to start out by acknowledging
that this schedule change puts everybody in a
tougher position than they would have been. Frankly,
I had a death in the family and I've got to travel.
today and I know that the the interim order was
going to expire so I thought it important that
I not leave before doing this hearing so I I
apologize particularly to those who might not
have read the ECF notifications until this morning
and saw that there was a change in the schedule
so with that I'll stop apologizing and turn it
over to debtors. Hi, Your Honor. Good afternoon.
Darren Asden from McDermott, proposed counsel
to the debtors. I guess my question for Your
Honor is how you want to proceed with today as
a status conference. I guess I assumed that you
maybe wanted to get understanding from the parties
about whether we could come to an agreement on
a further initial interim order to accommodate
the court for a further second day, a second
interim hearing. Is that how your honor would
like to proceed? Because I think there's a way
to easily do that. Yeah, I think that's right.
The bill landscape is somewhat altered because
of the objections that were filed by 1548199
Alberta and the ward trust. I'm hopeful that
both parties are represented at this hearing
this afternoon, but it certainly bears on the
relief that was granted. We're here on an interim
hearing, so what my goal is is to address it
insofar as I can to get a further order approved
that prevents immediate and irreparable harm
to the debtors, but we're going to have to have
a more, well, we're going to have to have a full
hearing on the objections that were raised. Well,
let me make a proposal. Let the court and other
parties know what would work for the debtors,
and then I guess we can hear from the objecting
parties, if that makes sense, Your Honor. Yeah,
please, Mr. Esmond. Sure. So as you noted, the
order expires on its own terms tomorrow. So obviously,
the first thing we need is whenever the second
interim hearing is scheduled, the current order
or a revised form of that would need to carry
through to that hearing. And I guess it'd be
good to hear from your honor at some point what
dates work for your honor. We can certainly accommodate
pretty much anything. And then the only additional
item is we need to increase the cap. You'll remember
that the interim cash collateral order as well
as the second interim. Which I guess I should
note that Mr. Wilford's client has already consented
to entry of that, but you're right, there is
an objection from another party now that will
need to be addressed. But I'm sure that Mr. Wilford
and I can agree on a slightly increased amount
for what I'll call the revised first interim
period. I think what my folks are telling me
is that as long as we had a second interim order
hearing before the end of this week, we would
be comfortable with increasing the cap to 2 .5
million. that would get us through April 3rd.
If there's other dates that the court or other
parties want to think about, I kind of have different
numbers depending on what it is. There's obviously
a push in built in, it's not exact, but I just
wanted to throw that out there for your honor
to understand and for the other parties. But
we would be fine with carrying the first interim
order with the slightly increased cap to 2 .5
through the end of this week, as well as obviously
pushing out the expiration of the first interim
order. Okay, okay, I appreciate that. Let me
hear from Mr. Geller. Mr. Geller, good morning
or good afternoon. 1548199 in Alberta. Also here
with my co -counsel Thomas Padish and Alyssa
Kiriakos. Your Honor, we are certainly not trying
to be in any way preventing the debtor from having
use of cash collateral. Obviously our projection
was limited for that purpose and we're amenable
certainly to a further interim order. One thought
we had was to take an interim order through to
the 16th when we have a bunch of other things
teed up and have it all heard at the same time.
and I'm sure we could work with the debtors in
terms of making sure that that gets to the point
where they have enough cash available to get
to that hurdle. Okay. That would also work, Your
Honor, obviously. It would be preferable. Okay,
Mr. Hesman. How about the ward trust? Your Honor,
Mr. Shirley. I'll just see me... Okay, Ethan,
you were able to get on. I was just about to
say that Mr. Sulik had emailed me saying he didn't
have the video link, but I'm glad you were able
to get on. Yeah, and again, I apologize, Mr.
Sulik, for the little notice, which was entirely
my doing, so I apologize for that. Your Honor,
the Richard Ward Trust is also amenable to the
proposal. Okay, so let me just clarify with Mr.
Sulik and Mr. Gellert. What you're proposing
is that enter a second interim order on the term
set forth in the initial order with a change
in the cap to 2 .5 million? Yes, that's correct,
Your Honor. Okay. That's our understanding as
well. Yes. Your Honor. Mr. Wilford. Yes, good
afternoon. Your Honor, good afternoon. Keith
Wilford from White and Case on behalf of Celsius.
As your honor is aware, and I think as Mr. Asman
alluded to, we put in a form of second interim
order that was proposed and agreed that in fact
had an expiration of the 16th. There's obviously
a lot of volatility around crypto. Celsius as
a secured creditor is secured by not only cryptocurrency,
but also assets that are in effect dependent
on cryptocurrency for value. And so we've been
balancing with the debtors. the duration of this
interim period versus the protection. So in the
proposed interim, there was an increase of the
usage cap effectively to $5 million. But then
there was also a series of protections, including
a trigger for potential emergency hearing, given
that if there was a correct collapse in the value
of crypto, obviously the alleged pushing would
reduce substantially. There were a number of
other elements in that draft order, which are
primarily around information and around segregation
of sales of any non -crypto assets in a segregated
account with respect to proceeds. And from our
perspective, the ideal scenario would be that
those protections would come into place now as
we had negotiated those as a package with the
debtors in exchange for use through the 16th.
We don't believe that those elements are prejudicial
to any of the objectors. And so, to the extent
there is a proposal to go to the 16th, we would
like the second interim order to be the form
rather than the existing form. Subject to, of
course, any agreement of the debtors, if they
want to lower the $5 million, obviously we don't
have an objection to that. Your Honor, I want
to clarify. The $2 .5 million that I had mentioned
would get us to the end of this week. I think
what Mr. Gellert and Mr. Sulek were indicating,
and they'll correct me if I'm wrong, is that
They're actually okay with the form of second
interim order that's been agreed to with Mr.
Wilford and I and our clients that carries us
to the 16th. So we should put aside the $2 .5
million that I threw out. I agree with Mr. Wilford.
We should just go forward with the order that's
on file again, subject to Mr. Geller and Mr.
Sola saying there's an issue with that. But I
thought that that's what they were saying. Let
me start Mr. Geller. Are you agreeing to the
form of second interim order? You know, I can't
say that I've scoured that one. Yeah, it was
only filed yesterday. Yeah. Yeah, I was going
to say, I just certainly want them to have the
availability of cash. I just would want to look
at the additional protections that they're referencing.
Yeah. Mr. Sulek? Our goal is just to get to the
16th and to have our rights preserved without
further prejudice for our client. we'd prefer
the opportunity to also look at the proposed
form of order and then perhaps coordinate with
the debtors to see if we're amenable to that
after reviewing. Okay. Your Honor, also if I
may. Yeah, Ms. Van Lair. Good afternoon. Welcome.
Yes. Thank you. Good afternoon. Jane Van Leer,
Cleary .com. It's Jan Hamilton on behalf of the
ad hoc group of Blockville's customers. I just
wanted to chime in. We don't have an objection
to the cash collateral order, but it was filed
yesterday and my clients are extremely concerned
about the expenses of the estate. And so we would
like similarly an opportunity to review the order,
review the amounts that are being proposed. And
also there's a provision in the order that says
the amounts can be exceeded with Celsius' consent.
And we certainly want to add that our own, the
ad hoc group as another party that should similarly
get consent in the event that the debtors will
exceed the amount. Yeah, and look, I hear that,
and in addition, I know that the Office of the
United States Trustee has appointed a committee
who I suspect has not yet retained counsel. Here's
what I think we ought to do. I would like the
parties to discuss offline, if possible, and
see where you can get if the Look if they had
ad hoc group and Alberta and the ward trust and
Celsius are all on board on a form of order that
could get us through to the 16th, which is when
the parties will be Be here again. Well, actually
I'll tell you what I can look at other dates
if we need that but if The point being, if you
can agree on a form of order submitted under
certification of council, but if you can't get
there, then what I would be willing to approve
would be a further form of order substantially
in the form of the original interim order. It
can have an adjustment to the cap to reflect
the budgetary needs of the debtors moving ahead.
But on a substantive basis I think frankly there's
a lot in there that the parties probably want
to have a chance not only to review but to discuss
with their clients and get proper direction before
agreeing to it. Again, I just want to prevent
immediate and irreparable harm to the debtors
and not do anything that's going to inappropriately
affect the rights of the objecting parties without
an opportunity for a full adjudication of their
objections. get all the parties on board with
a form of second interim order that takes us
to the 16th. But just as a procedural matter,
what is Your Honor's availability if in the event
we're not able to get the deal on that? When
is Your Honor, when do you need me to upload
a second revised order that's consistent with
the first one other than an increase to the cap
to make sure that we don't break the expiration
of the first interim order tomorrow? That's my
main concern. Okay, my expectation is that today
I will have pretty much continuous internet access
for the rest of today. Tomorrow it's going to
be a lot more difficult, but we will keep an
eye out. And I know my staff will do their best
to get a hold of me. We'll take care of it. The
order won't lapse without a new order in place.
I appreciate that. Thank you, Your Honor. Sure.
Sure thing. Okay. Anything else? Not from the
debtors, Your Honor. Okay. And Mr. Asmon, I take
it that you have not heard from a firm that's
been retained by the committee at this point.
You know, my understanding is that the committee
is holding pitches for legal counsel today, so
I suspect we'll know who we're dealing with by
the end of today or tomorrow, hopefully. Okay,
fantastic. Okay, well look, I'll leave you to
it and we will look at for a certification of
counsel or, you know, if you can't get there
and you need judicial intervention, maybe I can...
Maybe I can get a colleague to help out, but
hopefully you can get there. We will try to avoid
the need to have to do that, Your Honor. Okay,
I do appreciate that. All right. Well, thank
you all for being so accommodating to my schedule.
I genuinely do appreciate it. And we'll look
out for the certification of counsel. Okay? Okay,
thanks. Thank you, Your Honor.