Edgemere Dallas initiated a voluntary and comprehensive restructuring through Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Northern District of Texas.
Edgemere remains fully operational throughout the Chapter 11 process, continuing to provide care and services to its residents and their families and fulfilling obligations to its other stakeholders. Edgemere is negotiating with its financial stakeholders on a restructuring plan that will provide the community with a healthier, more sustainable financial future. To help fund and protect its operations during the Chapter 11 process, Edgemere is seeking court approval for debtor-in-possession (DIP) financing provided by UMB Bank, as indenture trustee. Edgemere is confident that it will gain long-term financial flexibility and stability by reaching a permanent resolution with its financial stakeholders through this process.
Simultaneously with the bankruptcy filing, Edgemere also filed a lawsuit against its landlord, Intercity Investments, and its agent, Kong Capital, alleging claims for, among other things, breach of contract, promissory fraud, tortious interference with business and contractual obligations, civil conspiracy and equitable subordination. The community believes that pursuing the lawsuit is in the best interest of Edgemere, its residents, the bondholders and all stakeholders, and it intends to pursue the lawsuit vigorously.
“Edgemere has entered into this process with support of its bondholders and Lifespace Communities; and we remain steadfast in our commitment to our residents as we work through this process in a manner that will allow current and future residents to enjoy all that Edgemere has to offer for many years to come,” Jesse Jantzen, president and CEO of Lifespace Communities, said. “The only outstanding piece is resolution with the landlord and its agents, and we have filed a lawsuit against them alleging claims for their actions over the last year. Edgemere has faced various challenges—from managing the impact of the COVID-19 pandemic to responding to Winter Storm Uri in February of 2021. Like previous challenges we have overcome, we will tackle these issues head-on and remain committed to identifying a long-term financial solution. As always, the interests of our current and future residents are our main priority.”
Edgemere has filed certain motions with the U.S. Bankruptcy Court that will allow it to meet go-forward commitments to all stakeholder groups through the Chapter 11 process, including employee wages and benefit programs. These motions are typical in Chapter 11 proceedings and remain subject to court approval.
Edgemere’s owner, Lifespace Communities, has not filed for Chapter 11 and will continue to own and operate Edgemere throughout the Chapter 11 process.
Edgemere is represented in this matter by Polsinelli as legal counsel and FTI Consulting as restructuring advisor.
