I’ll treat April Fools as now effectively over — as of Friday evening. It is certainly over — for KaloBios, Mr. Shkreli and the December 2015 PIPE putative purchasers. [No, gentle readers, you have not lost your way. This is one of a very rare occasional cross-postings, from the mini-site, on KaloBios’ Chapter 11 bankruptcy.]
Earlier I mentioned in comments that an April 5, 2016 hearing has been scheduled for 2 PM EDT in Delaware. I cannot tell (because the electronic dockets do not say) exactly what will be on the agenda — but I now think it may entail more than just an update on the DiP progress.
The notice lists a Bankruptcy Rule 105(d)(2) hearing as being teed up — for Tuesday afternoon.
That particular bankruptcy rule is an exceptionally broad one — it empowers the court to collapse time frames, sanction parties who are (arguably) hindering the speedy administration of the case, and even to approve a Chapter 11 plan and disclosure statement — all at one hearing. It is likely the most Brigadoon-like rule — in all the bankruptcy court’s village of rules.
So my revised guess is that KaloBios is going to ask the court to cut off all additional debate on the claims of the PIPE Group, and move forward with the DiP Stalking Horse process, essentially immediately.
Note that even under the previously court-approved extended dating, KaloBios has only until April 7, or Thursday of next week, to have signed the definitive stalking horse deal. If the company keeps having to argue about whether the PIPE group claim has merit — i.e., the constructive trust theory, on that $8.2 million — the whole plan may fall apart (or so I expect Kalobios’ lawyers will argue).
So — we could well see the court order a stay on all PIPE claims, until the plan is confirmed and the DiP process is completed.
Or. . . it might all just be to get authority to change some of the DiP terms. We shall see.
In closing, I’ll note that Hogan Lovells today filed its second set of legal bills, for reimbursement — for the month of February (i.e., a month behind). The amount is over $340,000. And we haven’t seen the Morris firm (on local Delaware law) for February yet. In the first two months, then (not including March time), the aggregated legal bills are approaching $1.6 million.
The clock is literally ticking, now — and the estate is racking up some serious bills.
Should all make for an interesting mid-week, next week. Have a stellar weekend, one and all!