UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

WEST PALM BEACH DIVISION

www.flsb.uscourts.gov

In re: Chapter 11

ICAN BENEFIT GROUP, LLC, Case No. 21-12567-MAM

Jointly Administered with:

ICAN HOLDINGS, LLC, Case No. 21-12568-MAM

ON CALL ONLINE, LLC, Case No. 21-12569-MAM

Debtors.

/

VERIFIED RESPONSE IN OPPOSITION TO 

DEBTORS’ EMERGENCY MOTION TO USE CASH COLLATERAL

Southern Guaranty Insurance Company (“SGIC”) hereby responds in opposition to the 

motion of ICAN BENEFIT GROUP, LLC (“Benefit Group”), ICAN HOLDING, LLC 

(“Holding”), and ON CALL ONLINE, LLC (“OnCall,” and together with Benefit Group and 

Holding, the “Debtors”) for order authorizing use of cash collateral (the “Motion”) [ECF No. 13]. 

The Motion should be denied because (i) the Debtors have access to other cash that appears 

sufficient to fund their proposed expenses without resorting to using SGIC’s cash collateral; and 

(ii) the Debtors have provided incomplete and misleading information and have failed to carry 

their burden of proving that SGIC’s interest in the Debtors’ cash collateral will be adequately 

protected.

PRELIMINARY STATEMENT

1. SGIC asserts that these bankruptcy cases have been commenced solely to protect 

the interests of the owner of the Debtors, Steven Tucker, from the consequences of his actions prefiling, and to frustrate and delay enforcement of SGIC’s rights. As described below, SGIC holds

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an option to purchase the assets of the Debtors and was in the process of negotiating terms of its 

exercise of that option that would have provided substantial benefits to the Debtors and their other 

creditors. In the midst of those negotiations, the Debtors filed their petitions on March 18, 2021. 

SGIC believes that the Debtors have and will continue to sustain cash losses in its businesses and 

ultimately these cases will fail when the Debtors have exhausted available cash, to the detriment 

of SGIC and the other creditors of the Debtors. Indeed, the Debtors’ proposed cash collateral 

budget demonstrates that the Debtors’ cash on hand and cash to be received will decline during 

the three-week period from $524,843 to an ending cash balance of $312,023. Without serious 

reductions in expenses, it appears the Debtors will quickly run out of cash to pay operating 

expenses and other chapter 11 administrative expenses.

2. Moreover, the Debtors’ budget note 1 lists $386,191 of proceeds from a PPP loan. 

SGIC does not claim a perfected security interest in the PPP loan proceeds and does not object to 

use of those funds to pay expenses in the budget. That cash appears to be sufficient to pay expenses 

during the initial requested period of use. Therefore, the Debtors have not demonstrated a need to 

use SGIC’s cash collateral in order to avoid immediate and irreparable harm, which is required by 

Fed. R. Bankr. Pro. 4001(b)(2). 

BACKGROUND

3. The Debtors are indebted to SGIC pursuant to that certain Amended and Restated 

Loan and Security Agreement dated March 19, 2019 among SGIC, on one hand, and the Debtors 

and various affiliates of the Debtors, on the other hand (the “Loan Agreement”). Pursuant to the 

Loan Agreement, the Debtors granted SGIC a security interest in substantially all of their assets 

(the “Collateral”) to secure all Obligations owed by the Debtors to SGIC and its Affiliates, as 

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defined in the Loan Agreement. The Collateral includes “cash collateral” as that term is used in 

section 363(a) of the Bankruptcy Code. 

4. SGIC perfected its security interest by filing a UCC-1 financing statement with the 

Florida Secretary of State on March 20, 2019 as File No. 201908175409. 

5. The Obligations under the Loan Agreement total in excess of $9,757,846.

6. Steven Tucker, the ultimate owner of the Debtors, executed a “Bad Boy” Guaranty 

in favor of SGIC.

7. The parties entered into the Loan Agreement in the context of a broader 

restructuring transaction of the Debtors’ business. In conjunction with the Loan Agreement, 

Holding entered into a Purchase Agreement pursuant to which Holding acquired indirectly from a 

third-party investor group equity interests in Benefit Group and all of the equity interests in OnCall. 

8. To facilitate the Purchase Agreement, the Debtors and their affiliates requested (i) 

SGIC to enter into the Loan Agreement to finance the purchase and continued operations, (ii) CD 

Paradise Management, LLLP (“Paradise”), an affiliate of SGIC, to provide management services, 

and (iii) SGIC and certain affiliates to provide certain guaranties of obligations of Holding and 

Benefit Group. 

9. To induce SGIC and its affiliates to provide such accommodations and support, the 

Debtors and certain affiliates (the “iCan Parties”) entered into an Option Agreement. Pursuant to 

the Option Agreement, the iCan Parties granted an option to a designee of SGIC, Premier

Administration Solutions, Inc. (“TPA”), Paradise, and Dale Schmidt to acquire the business 

conducted by the Debtors. The consideration for granting the Option Agreement comprised of (i) 

SGIC’s accommodations and support to facilitate the Purchase Agreement and (ii) a one-time 

payment of $100,000 to Mr. Tucker, which was paid in 2019. In the event of an exercise of the 

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Option, the optionee exercising the option would be required to satisfy and release certain 

liabilities.

10. Upon the closing of the restructuring transactions, Mr. Tucker used $500,000 of the 

loan proceeds to pay himself a “transaction bonus.”

11. The 2019 restructuring did not go well. After ongoing non-performance by the 

Debtors and forbearance by SGIC, in January 2021, SGIC finally sent a demand and acceleration 

letter to the Debtors. The parties engaged in settlement discussions, including a resolution 

whereby the Debtors would voluntarily surrender the Collateral to SGIC.

12. In February 2021, the Debtors proposed a voluntary surrender of the Collateral to 

SGIC. Accordingly, SGIC provided the Debtors with a proposed foreclosure and surrender 

agreement.

13. In March 2021, in lieu of a voluntary surrender, the Debtors instead proposed that 

SGIC designate an entity to exercise the option under the Option Agreement. Accordingly, at the 

Debtors’ suggestion, an affiliate of SGIC (CTS VI, LLLP) exercised the option under the Option 

Agreement and the parties commenced negotiating and preparing the necessary option exercise 

transaction documents. As part of the contemplated transactions, SGIC or its assigns would have 

assumed and paid certain liabilities and would have released Mr. Tucker from his (substantial) 

personal liability. 

14. In the midst of those activities, and SGIC’s and its affiliates’ good faith negotiations 

regarding the option exercise, without warning, the Debtors filed voluntary Chapter 11 petitions, 

apparently to seek leverage in the negotiations between the Debtors and SGIC and its affiliates, 

raising serious questions about the good faith of these filings.

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ARGUMENT

I. THE MOTION SHOULD BE DENIED BECAUSE SGIC’S INTEREST IN CASH 

COLLATERAL WILL NOT BE ADEQUATELY PROTECTED.

15. Under section 363(c)(2)(A) of the Bankruptcy Code, a debtor is not allowed to use 

cash collateral unless the debtor obtains the consent of the creditor with the secured interest in such 

cash collateral. Here, SGIC has not consented to the Debtors’ use of cash collateral.

16. Alternatively, a debtor may obtain the use of cash collateral under section 

363(c)(2)(B) if the Court, after notice and hearing, authorizes such use of cash collateral in 

accordance with the provisions of that section. A prerequisite for a court’s approval of a debtor’s 

request to use cash collateral is that adequate protection be provided to the party with a secured 

interest in cash collateral under section 363(e). In re Delco Oil, Inc., 599 F.3d 1255, 1258 (11th 

Cir. 2010); In re Martin, 761 F.2d 472, 475 (8th Cir. 1985). Section 361 provides that adequate 

protection may take the form of (1) periodic cash payments, (2) additional or replacement liens, 

and (3) such other relief as will result in the realization by the secured creditor of the indubitable 

equivalent of its interest in the property. 11 U.S.C. § 361.

17. What constitutes adequate protection is decided on a case-by-case basis. See, e.g., 

In re George Ruggiere Chrysler-Plymouth, Inc., 727 F.2d 1017, 1019 (11th Cir. 1984) (requiring 

individual determination of value of secured interest and whether use of cash collateral threatens 

that value); Matter of Karl A. Neise, Inc., 16 B.R. 600, 601 (Bankr. S.D. Fla. 1981) (“What 

constitutes adequate protection varies with the facts and circumstances of each particular 

case . . . .”); In re Mosello, 195 B.R. 277, 289 (Bankr. S.D.N.Y. 1996) (“the determination of 

adequate protection is a fact-specific inquiry . . . left to the vagaries of each case”); In re Beker 

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Indus. Corp., 58 B.R. 725, 736 (Bankr. S.D.N.Y. 1986) (the application of adequate protection “is 

left to the vagaries of each case, but its focus is protection of the secured creditor from diminution 

in the value of its collateral during the reorganization process”) (citation omitted).

18. The critical purpose of adequate protection is to guard against the diminution in the 

value of a secured creditor’s collateral during the period when such collateral is being used by the 

debtor in possession. Matter of Karl A. Neise, Inc., 16 B.R. 600, 601 (Bankr. S.D. Fla. 1981); In 

re 495 Central Park Avenue Corp., 136 B.R. 626, 631 (Bankr. S.D.N.Y. 1992).

19. The Debtors bear the burden of proof of the issue of adequate protection. 11 U.S.C. 

§ 363(p)(1).

20. For adequate protection, the Debtors propose to provide SGIC with a replacement 

lien. However, the Debtors have not demonstrated that a replacement lien will protect SGIC’s

interest in the Debtors’ cash collateral from diminution in value, because they have not 

demonstrated that SGIC is protected by a sufficient “equity cushion”. 

21. The Debtors rightly acknowledge that SGIC has an interest in cash collateral, but 

nowhere does the Motion disclose the amount owed under the Loan Agreement. The Debtors 

cannot claim ignorance, as they received multiple demand letters from SGIC in January 2021, 

including a full itemized detail of the amount owed as of December 31, 2020: not less than 

$9,757,846. 

22. The Debtors have also failed to establish that SGIC is protected by an equity 

cushion, because they have not established by any evidence presented to this Court as to the value 

of SGIC’s collateral. The only “evidence” provided by the Debtors is their statement in footnote 

4 that the Debtors’ business is worth somewhere between $33 million to $60 million, based on an 

out-of-date net present value of the stream of premium payments that was projected to occur over 

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a ten year period. That valuation depended on account policy renewal assumptions and other 

assumptions that are no longer true. The Debtors’ book of business has declined since August 

2020, and the present bankruptcy cases will almost certainly mean a higher rate of non-renewals. 

The Debtors have not established that SGIC is protected by a sufficient equity cushion to allow 

the Debtors’ use of cash collateral.

23. The only thing that is certain is that the Debtors propose to use up SGIC’s cash 

collateral. The only evidence in the record, in the form of the budget attached to the Motion (the 

“Budget”), shows a steady decline in the Debtors’ cash balance. The Debtors have provided no 

evidence that the value of SGIC’s collateral base will be stable over the course of the period in 

which it seeks to use cash collateral.

24. In addition, the Debtors have not proposed to make monthly payments or any other

form of adequate protection to ensure that SGIC realizes the indubitable equivalent of its interest 

in the property under 11 U.S.C. § 361(3).

25. Finally, the Debtors have also failed to demonstrate a need to use cash collateral on 

an emergency basis. Fed. R. Bankr. Pro. 4001(b)(2) provides that the court may authorize use of 

cash collateral on shorter than 14 days’ notice but the court may authorize such use only to the 

extent necessary to avoid immediate and irreparable harm. The Motion and Budget show the 

Debtors have access to PPP loan proceeds of at least $386,000 to pay expenses. SGIC does not 

claim a perfected lien in those loan proceeds. They appear to be more than sufficient to pay 

projected expenses totaling $309,420 for the period of use. Therefore, there is no need to use cash 

collateral subject to SGIC’s lien on an emergency basis. 

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CONCLUSION

For the foregoing reasons, SGIC respectfully requests that the Court deny the Debtors’ 

motion for order authorizing use of cash collateral.

/s/ Lara Roeske Fernandez

LARA ROESKE FERNANDEZ

Florida Bar No. 0088500

lfernandez@trenam.com

TRENAM, KEMKER, SCHARF, BARKIN,

FRYE, O’NEILL & MULLIS, P.A.

101 E. Kennedy Blvd., Suite 2700

Tampa, FL 33602

Tel: (813) 223-7474

Attorneys for Southern Guaranty Insurance 

Company

/s/ Clinton E. Cutler

CLINTON E. CUTLER

Minnesota Bar No. 158094 (pro hac pending)

ccutler@fredlaw.com

JAMES C. BRAND

Minnesota Bar No. 387362 (pro hac pending)

jbrand@fredlaw.com

FREDRIKSON & BYRON, P.A.

200 South Sixth St., Suite 4000

Minneapolis, MN 55402

Tel: (612) 492-7000

Attorneys for Southern Guaranty Insurance 

Company

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CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on March 23, 2021, a true and correct copy of the foregoing 

was furnished by Notice of Electronic Filing to: Jacqueline Calderin, Esq., jc@agentislaw.com; 

Robert P. Charbonneau, Esq., rpc@agentislaw.com; Office of the U.S. Trustee, 

USTPRegion21.M.M.ECF@usdoj.gov and to all those receiving electronic notice. 

/s/ Lara Roeske Fernandez

Attorney

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