Friday, April 25, 2014

TelexFree News Update 4/25/2014: millions deposited with lawyers in only 2 months

A series of disclosures by the lawyers involved with TelexFree yielded many interesting tidbits

1) According to disclosure by Greenberg Traurig, they were retained by TelexFree in February 2014, when Massachussetts started asking questions. Then on April 7th, when TelexFree started contemplating bankruptcy, they signed a new contract.

See  paragraph 4 and 5

2) Greenberg Traurig has been paid over 3.72 MILLION dollars so far, but only spent about 557 thousand as of 4/24/14.

See paragraph 6

3) To handle bankruptcy in Nevada, another lawfirm, Gordon Silver, was retained on April 13th. That's the same day the bankruptcy petition was entered in Nevada. They were paid 750K, of which they spent 55K as of 4/24/14

See paragraph 4

4) Then Gordon Silver hired Kurtzman Carson  (i.e. KCCLLC), who were paid 350K, and spent very little of it thus far.

5) We don't know how much did Alvarez and Marsal (restructuring experts) were paid, but they were hired on April 10th. But it should be more than KCC.

6) TelexFree lied to Alvarez and Marsal, and A&M duly repeated the lies. To quote:
The Company experienced exponential growth in revenue between 2012 and
2013 (from de minimus amounts to over $1 billion), which put tremendous pressure on the
Company's financial, operational and management systems
$1 billion is what TelexFree PROMISED to the affiliates/investors, not TelexFree's revenue. Actual revenue is more like $300 million. 

See  Paragraph 12

7) There will be no more TelexFree Massachusetts
TelexFree Nevada is the contracting party to the terms and conditions contract with the Promoters (the "Promoter Contract"). TelexFree Florida is the owner of the Company's primary bank account. TelexFree Massachusetts was the original corporate entity but is being phased out.
See  Paragraph 16

8) TelexFree is NOT going to honor ANY contract to affiliates/promoters before bankruptcy petition
Because neither of the Pre-Petition Comp Plans meets the needs of the Debtors businesses. The Debtors intend to discontinue and reject the Pre-Petition Comp Plans and quantify the legitimate claims under those Plans ...
Debtors (TelexFree) have determined that it is imperative that they reject the Rejected
Contracts as of the Petition Date
so as to quantify claims thereunder and work on putting a new program in place. 
See Paragraph 85 and 86
Original plan, revised plan, all go out the window.

Enhanced by Zemanta

1 comment:

  1. @Andrea jibar gomez -- no lo accepta spam. Solo tienes un "pagina de captura" alli. No hay ningun information.