In a major step forward for the reorganization of Celsius Network LLC and its affiliated debtors (the "Debtors"), the United States Bankruptcy Court for the Southern District of New York approved the adequacy of the Debtors’ fourth amended disclosure statement and the solicitation and voting procedures for their joint plan of reorganization (the "Plan") on August 17, 2023. The court order (the “Order”) sets forth the key dates and deadlines relating to the confirmation process, such as filing objections, voting on the Plan, and attending the confirmation hearing. The Order approving the disclosure statement can be found here.

A hearing on confirmation of the plan is tentatively scheduled for October 2, 2023, at 2:00 p.m. ET. Prior to the confirmation hearing, creditors will have a chance to vote on the Plan and those Creditors eligible to vote will be receiving solicitation materials, likely in the next few days. The Plan that creditors are going to be voting on is substantially the same as the one that we analyzed in our prior post.

The following is a summary of some of the key terms contained in the Order and the Solicitation Procedures related to voting and confirmation of the Plan.

The Order establishes the following key dates and deadlines for the Plan confirmation process:

The Order also approved the Debtors’ Solicitation Procedures, which govern the distribution of solicitation packages and the Plan voting process. The Solicitation Procedures provide for the following:

• Solicitation packages will include a cover letter, a letter from the official committee of unsecured creditors, the Solicitation Procedures, the applicable ballot form, a notice of claims settlement, the Disclosure Statement and its exhibits (including the Plan), the Order, the notice of the Confirmation Hearing, and any additional court-ordered documents.

• Solicitation packages will be distributed primarily via email (e.g., for account holders and other holders with email addresses on file). The Debtors will also cause a “push” notification to be delivered via their mobile application to holders of certain claims. Physical packages will be provided upon request.

• Holders of claims entitled to vote on the Plan may submit their Ballots via (a) the Claims, Noticing, and Solicitation Agent's online voting platform at https://case.stretto.com/Celsius/balloting, or (b) mail or hand-delivery to the Claims, Noticing, and Solicitation Agent at Celsius Ballot Processing c/o Stretto, 410 Exchange, Suite 100, Irvine, CA 92602.

• Non-voting notices will be provided in lieu of Solicitation Packages for unimpaired claims, claims deemed to reject the Plan, disputed claims, and unclassified claims.

• On the voting ballot, applicable creditors will have the option to opt out of the settlement, whereby claims are increased by 5% in exchange for waiving fraud claims.

• Assumption and rejection notices will be provided to contract counterparties.

• Irregular ballots will be subject to the Debtors' discretion (in consultation with the Committee).

• Amendments to plan documents will be allowed, subject to Bankruptcy Court approval and notice requirements.

• One potentially noteworthy revision to the amended disclosure statement is pointing out that the Debtors have yet to settle with the CEL Token Holders and, to the extent that they have not done so by the time of the Confirmation Hearing and the CEL Token Holders vote to reject the Plan, they will look to the Court for guidance.

• Repayment to Earn and most other creditors will not take place until after the Plan is confirmed.

The Plan provides better treatment for those Creditors who actively vote for the plan, as such creditors should carefully review the Solicitation Procedures and the instructions on the ballot forms before voting on the Plan and consult with their legal advisors regarding their rights and obligations under the Plan. Creditors should also monitor the Debtors' case website at https://cases.stretto.com/celsius/ for any updates or amendments to the Plan, the Order, or the Solicitation Procedures. In particular, if there is any discrepancy in your claim type or amount you should reach out to Stretto, the company, or your legal counsel.