CiCi’s Pizza

DEBTORS AND THEIR BUSINESSES

• CiCi’s Holdings, Inc.
• Awesome Acquisition Company
• CiCi Acquisition Company, LLC
• CiCi Enterprises, LP
• CiCi GP, LLC
• CiCi Services, LLC
• JMC GP, LLC
• JMC Restaurant Distribution, LP
• Pizza Parent, LLC

DEBTORS ARE TRYING TO CRAM THROUGH A PLAN AGAINST CREDITORS’ INTERESTS

The jointly administered CiCi’s Pizza Debtors have filed what is known as a “pre-pack” bankruptcy. This means that the Debtors have already filed a proposed plan of reorganization and are trying to get confirmation of that plan on a very shortened timeline.

This is a common practice in larger bankruptcies but, unfortunately, it typically ends up harming the unsecured creditors more than any other parties.

In the CiCi’s case, the proposed plan, if confirmed, would pay unsecured creditors of all of the Debtors a total of only $50,000. That $50,000 is proposed to be distributed evenly among all of the Debtors’ unsecured creditors. While we do not have any information on the total creditors pool, it is nearly certain that the proposed $50,000 will pay unsecured creditors only pennies on the dollar.

CREDITORS MUST ACT FAST

Pre-pack bankruptcies like the CiCi’s case move very fast. In fact, the CiCi’s case already has a confirmation hearing scheduled for March 3, 2021.

All creditors from the largest to the smallest have a right to be heard in bankruptcy cases. However, once a plan is confirmed, there is not much that can be done. So, if creditors want to speak out against the proposed plan treatment that will deliver only pennies on the dollar to unsecured creditors, they must do so as soon as possible.

While pre-pack bankruptcies can sometimes feel like an impossible situation for creditors, that is not necessarily the case. With an organized and targeted approach, creditors may be able to improve their treatment and get more of their hard-earned money back in their pockets.