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UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

FORT LAUDERDALE DIVISION

In re: Case No. 20-19106-SMG

SEVEN STARS ON THE HUDSON CORP., Chapter 11

Debtor.

/

ORDER CONFIRMING THE DEBTOR’S 

SUBCHAPTER V PLAN FOR REORGANIZATION

This matter came before the Court on May 6, 2021 at 1:30 p.m., to consider 

confirmation of the Debtor’s Third Amended Plan (the “Plan”) (ECF. No. 194) filed on 

April 20, 2021 by the Debtor, Seven Stars on the Hudson Corp.; the Objection to 

Confirmation (ECF No. 217); the Motion to Assume Lease (ECF. No. 92); the 

Objection to Assumption of Lease (ECF No. 157); the Amended Motion to Borrow 

(ECF No. 180). In connection with the confirmation of the Plan, the Court has 

considered the evidence presented as well as the record of this case, including: (i) the 

confirmation affidavit of Eddy Berding (ECF No. 214), (ii) the certificate of proponent 

of plan (ECF No. 213), (iii) the testimony of Eddy Berding. Having considered that 

Scott M. Grossman, Judge

_____________________________________________________________________________ United States Bankruptcy Court

ORDERED in the Southern District of Florida on May 11, 2021.

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all classes of creditors that were required to vote on the Plan have accepted the Plan, 

and no objections to confirmation of the Plan have been filed or remain unresolved, 

after notice and a hearing, the Court finds and concludes as follows:

FINDINGS OF FACTS & CONCLUSIONS OF LAW

A. Jurisdiction. The Court has jurisdiction over this matter under 

28 U.S.C. §§ 157 and 1334, the United States District Court’s general order of 

reference, and other various applicable provisions of the Bankruptcy Code1 and the 

Federal Rules of Bankruptcy Procedure (“FRBP”).

B. Venue. Venue before the Court is proper under 28 U.S.C. §§ 1408 and 

1409.

C. Notice. Due, adequate, and sufficient notice of the Plan and the order 

setting a hearing on confirmation (ECF No. 187) were served upon all creditors, 

interest holders, the Post-Petition Lenders and parties requesting notice. 

Accordingly, the method of service and solicitation of acceptance of the Plan, notice of 

the hearing to consider confirmation of the Plan, and notices of all other deadlines or 

requirements relating thereto (collectively, the “Confirmation Deadlines”) were in 

compliance with the FRBP, were adequate and reasonable under the circumstances 

of this case, and no further or additional notice of the confirmation hearing or the 

confirmation deadlines was necessary or required.

D. Objections to Confirmation. The Court overruled the Objection to 

Confirmation (ECF No. 217) filed by MDG Powerline Holdings, LLC. 

 1 The term “Bankruptcy Code” refers to the applicable section(s) of 11 U.S.C. § 101, et. seq.

unless otherwise indicated.

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E. Proper Classification of Claims – 11 U.S.C. §§ 1122 and 1123. The 

Plan adequately and properly identifies and classifies all claims. Pursuant to

11 U.S.C. § 1122(a), the claims placed in each class are substantially similar to other 

claims in each such class. Pursuant to 11 U.S.C. § 1123(a)(1), valid legal and business 

reasons exist for the various classes of claims created under the Plan and such 

classification does not unfairly discriminate among holders of claims. The 

classification of claims in the Plan is reasonable.

F. Specified Unimpaired Classes – 11 U.S.C. § 1123(a)(2). The Plan 

specifies all classes or claims or interests that are not impaired under the plan. 

G. Specified Treatment of Impaired Classes – 11 U.S.C. § 1123(a)(3). 

The Plan specifies the treatment of all classes of claims or interests that are impaired 

under the Plan.

H. No Discrimination – 11 U.S.C. § 1123(a)(4). The Plan provides for 

the same treatment of claims or interests in each respective class unless the holder 

of a particular claim or interest has agreed to a less favorable treatment of such claim

or interest.

I. Implementation of the Plan – 11 U.S.C. § 1123(a)(5). Article IV of 

the Plan provides adequate means for the Plan’s implementation. The Debtor will 

continue to operate its business. Projections show the Debtor’s ability to pay its 

creditors. 

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J. Non-Voting Equity Securities/Allocation of Voting Power –

11 U.S.C. § 1123(a)(6). Inapplicable. 

K. Interests of the Creditors, Equity Security Holders, & Public Policy

– 11 U.S.C. § 1123(a)(7). The Plan contains only provisions that are consistent with the interests 

of creditors and equity security holders and with public policy with respect to the manner of 

selection of any officer, director, or trustee under the Plan and any successor to such officer, 

director, or trustee.

L. Assumption & Rejection – 11 U.S.C. § 1123(b)(2). Article IX of the 

Plan, pursuant to 11 U.S.C. § 365, provides for the assumption, rejection, or 

assignment of any executory contract or unexpired lease of the Debtor not previously 

rejected under such section.

M. Pending Claims - 11 U.S.C. §§ 1123(b)(3). The Plan provides that the

Debtor will retain its cause of action against MDG Powerline Holdings, LLC and XBK

Management, LLC pending under Adversary Proceeding No. 19-01230-SMG.

N. Additional Plan Provisions – 11 U.S.C. § 1123(b)(6). Each of the 

provisions of the Plan is appropriate and not inconsistent with the applicable 

provisions of the Bankruptcy Code.

O. Principal Purpose of the Plan – 11 U.S.C. § 1129(d). The principal 

purpose of the plan is not the avoidance of taxes or the avoidance of the application 

of section 5 of the Securities Act of 1933.

P. Subchapter V Plan Requirements – 11 U.S.C. § 1189. The Plan 

complies with 11 U.S.C. § 1189 because the initial plan was filed by the Debtor not 

later than 90 days after the order for relief under Chapter 11.

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Q. Contents of a Subchapter V Plan – 11 U.S.C. § 1190. In compliance 

with § 1190, the Plan includes: (1) a brief history of the business operations of the 

debtor, (2) a liquidation analysis, and (3) projections with respect to the ability of the 

Debtor to make payments under the proposed plan for reorganization. The Plan 

provides for the submission of all or such portions of the future earnings or other 

future income of the Debtor to the supervision and control of the Subchapter V 

Trustee as is necessary for the execution of the Plan. 

R. Satisfaction of Conditions – 11 U.S.C. § 1191(a). The Court finds 

that the Plan satisfies the relevant provisions of 11 U.S.C. § 1129(a) and, as a result, 

is a consensual Subchapter V plan under 11 U.S.C. § 1191(a). With respect to the 

relevant provisions of 11 U.S.C. § 1129(a), the Court finds and concludes as follows:

a. 11 U.S.C. § 1129(a)(1) and (a)(2). The Plan and the Plan 

proponent comply with the applicable provisions of the Bankruptcy Code.

b. 11 U.S.C. § 1129(a)(3). The Plan was proposed in good faith and 

not by any means forbidden by law.

c. 11 U.S.C. § 1129(a)(4). Any payment made or to be made by the 

Debtor, for services or for costs and expenses in or in connection with the case, 

or in connection with the Plan and incident to the case, has been approved by, 

or is subject to the approval of, the Court as reasonable.

d. 11 U.S.C. § 1129(a)(5). The Plan has disclosed the identity and 

affiliations of any individual proposed to serve, after confirmation of the plan, 

as a director, officer, or voting trustee of the Debtor, and the appointment to, 

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or continuance in, such office of such individual, is consistent with the interests 

of creditors and equity security holders, and with public policy; and the Plan 

proponent has disclosed the identity of any insider that will be employed or 

retained by the reorganized debtor, and the nature of any compensation for 

such insider.

e. 11 U.S.C. § 1129(a)(7). The Plan provides that, with respect to 

each impaired class of claims or interests, each holder of a claim or interest of 

such class has accepted the plan, or will receive or retain under the plan on 

account of such claim or interest property of a value, as of the effective date of 

the plan, that is not less than the amount that such holder would so receive or 

retain if the debtor were liquidated under chapter 7 of this title on such date 

f. 11 U.S.C. § 1129(a)(8). With respect to each class of claims or 

interests, such class has accepted the Plan, or such class is not impaired under 

the plan.

g. 11 U.S.C. § 1129(a)(9). Except to the extent that the holder of a 

particular claim has agreed to a different treatment of such claim, the Plan 

provides that with respect to a claim of a kind specified in 11 U.S.C. §§ 

507(a)(2) or 507(a)(3), on the Effective Date of the Plan, the holder of such claim 

will receive on account of such claim cash equal of the allowed amount of such 

claim. 

h. 11 U.S.C. § 1129(a)(10). If a class of claims is impaired under 

the Plan, at least one class of claims that is impaired under the Plan has 

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accepted the Plan, determined without including any acceptance of the plan by 

any insider.

i. 11 U.S.C. § 1129(a)(11). Confirmation of the Plan is not likely 

to be followed by the liquidation, or the need for further financial 

reorganization, of the debtor or any successor to the debtor under the Plan, 

unless such liquidation or reorganization is proposed in the Plan.

j. 11 U.S.C. § 1129(a)(12). All fees payable under 28 U.S.C. § 1930, 

as determined by the Court at the hearing on confirmation of the plan, have 

been paid or the plan provides for the payment of all such fees on the effective 

date of the Plan.

Accordingly, the Court ORDERS:

1. Confirmation. The plan is confirmed under 11 U.S.C. § 1191(a).

2. Assumption of Lease. The Motion to Assume Lease (ECF No. 92) is 

granted. The Debtor shall pay to the landlord the sum of $225,000.00 upon this order 

becoming final.

3. Approval of the Post-Petition Lender Agreements. The PostPetition Agreements attached as an exhibit to the Plan are approved and the Debtor 

is authorized to borrow funds thereunder on the terms and conditions outlined in the 

Plan. Should the Debtor obtain any recovery in the Lawsuit, or if a settlement results 

in the Debtor receiving funds in exchange for leaving the facility, the proceeds after 

the expenses of litigation including litigation funding will be paid, in the following 

order, first to satisfy Allowed Claims of Broward County, second to satisfy amounts 

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owed to the Post-Petition Lenders under the Post-Petition Agreements on a pro-rata 

basis, third to satisfy any Allowed Claims of Wells Fargo, and fourth to pay Allowed 

Claims of Unsecured Creditors on a pro-rata. The Claims of the Post-Petition 

Lenders will be paid ahead of the claims of Wells Fargo only with respect to funds 

derived from litigation proceeds.

4. Binding Effect of Plan. Pursuant 11 U.S.C. § 1141(a), except as 

provided in §§ 1141(d)(2) and (3), the provisions of the Plan as of the Effective Date, 

bind the debtor, and any creditor, equity security holder, or general partner in the 

Debtor, whether or not the claim or interest of such creditor, equity security holder, 

or general partner, is impaired under the plan and whether or not such creditor,

equity security holder, or general partner has accepted the Plan.

5. Re-vesting of Property. Under 11 U.S.C. § 1141(b), except as 

otherwise provided in the Plan or in this Confirmation Order, as of the Effective Date, 

all of the property of the estate vests in the Debtor. Except as provided in 11 U.S.C. 

§§ 1141(d)(2) and (3) and except as otherwise provided in the Plan or in this Order, 

after confirmation of the Plan, the property dealt with by the Plan is free and clear of 

all claims and interests of creditors, equity security holders, and of general partners 

in the debtor. Any and all liens of Broward County Tax Collector and Wells Faro 

against property of the Debtor survive and remain in full force until final payment is 

made to satisfy the secured claims of Broward County Tax Collector and Wells Fargo.

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6. Post-Confirmation Operation of Business. Except as otherwise 

provided in the Plan or in this Confirmation Order, on and after the Effective Date, 

the Debtor may operate its business and may use, acquire, and dispose of property 

free of any restrictions of the Bankruptcy Code and Bankruptcy Rules and in all 

respects as if there were no pending case under any chapter or provisions of the 

Bankruptcy Code. The Debtor is entitled to retain and compensate professionals 

without the necessity of further approval of this Court. Except as set forth in the 

Plan concerning objections to claims, the Debtor may also settle or compromise any 

claims without Court approval.

7. Injunction and Discharge. Except as otherwise expressly provided 

in the Plan or in this Confirmation Order, as of the Effective Date: (i) the Debtor shall 

be discharged from any debt to the fullest extent provided by 11 U.S.C. § 1141(d); and 

(ii) all holders of any discharged claims against the Debtor are enjoined from 

enforcing any such claim to the fullest extent provided by 11 U.S.C. § 524(a). To the 

extent the Plan discharge provisions set forth in section XI of the Plan are 

inconsistent with this Confirmation Order or the Bankruptcy Code, this Order and 

the Bankruptcy Code, including 11 U.S.C. § 1141(d), control.

8. Disbursing Agent. Eddy Berding is named as Disbursing Agent and 

must make all payments to holders of allowed claims as required by the Plan.

9. United States Trustee Guidelines. The Debtor must comply with the 

guidelines set forth by the Office of the United States Trustee until the closing of this 

case by the issuance of a Final Decree by the Bankruptcy Court.

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10. Effect of Confirmation Order on Plan. The failure to reference or 

address all or part of any particular provision of the Plan herein has no effect on the 

validity, binding effect, or enforceability of such provision and such provision has the 

same validity, binding effect, and enforceability as every other provision of the Plan. 

To the extent that any inconsistencies exist between the terms of the Plan and this 

Confirmation Order, the terms of this Confirmation Order shall control.

11. Executory Contracts and Leases. Except as otherwise provided in a 

separate order of the Court, all executory contracts and unexpired leases not 

otherwise assumed are deemed rejected as of the Effective Date.

12. Service of Confirmation Order. Brian K. McMahon is directed to 

serve a copy of this Order on all parties and file a certificate of service within five (5) 

days of the entry of this Order.

13. Documents Required to Effectuate Plan. The Debtor is authorized 

to execute any and all documents reasonably required to effectuate the provisions of 

the Plan or prior Orders of this Court.

14. Modification After Confirmation. Under 11 U.S.C. § 1193(b), the 

Debtor may modify the Plan at any time after confirmation of the Plan and before 

substantial consummation of the Plan, but may not modify the Plan so that the Plan 

as modified fails to meet the requirements of 11 U.S.C. §§ 1122 and 1123, with the 

exception of 11 U.S.C. § 1123(a)(8). The Plan, as modified, becomes the Plan only if 

circumstances warrant the modification and the Court, after notice and a hearing, 

confirms the Plan as modified under 11 U.S.C. § 1191(a). Under 11 U.S.C. § 1193(d), 

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any holder of a claim or interest that has accepted or rejected the Plan is deemed to 

have accepted or rejected, as the case may be, the Plan as modified, unless, within 

the time fixed by the Court, such holder changes the previous acceptance or rejection 

of the holder.

15. Discharge of the Subchapter V Trustee. Under 11 U.S.C. § 1183, 

the service of the Subchapter V Trustee in the case shall terminate when the Plan 

has been substantially consummated, except that the United States trustee may 

reappoint a trustee as needed for performance of duties under § 1183(b)(3)(C) and 

§ 1185(a). Not later than 14 days after the Plan is substantially consummated, the 

Debtor shall file with the Court and serve on the Subchapter V Trustee, the United 

States trustee, and all parties in interest notice of such substantial consummation. 

The Debtor must file the Local Form “Final Report and Motion for Entry of Final 

Decree” on the later of: (a) substantial consummation of the Plan, or (b) entry of a 

final order resolving all disputed claims. Prior to the discharge of the Subchapter V 

Trustee, the Subchapter V Trustee shall comply with 11 U.S.C. § 1194 and distribute 

any applicable payments in accordance with the Plan.

16. Jurisdiction. The Bankruptcy Court retains jurisdiction to:

a. Resolve issues with respect to the Debtor’s substantial 

consummation of the Plan and to the extent the Debtor seeks to amend or 

modify the plan;

b. Resolve any motions, adversary proceedings, or contested 

matters, that are pending as of the date of substantial consummation;

c. Adjudicate objections to claims; 

d. Resolve disputes with respect to any and all injunctions created 

as a result of confirmation of the Plan;

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e. Adjudicate modifications of the plan under 11 U.S.C. § 1193;

f. Review and consider issues associated with the Debtor’s final 

report and entry of final decree, and to enter a final decree; and 

g. Enter such orders as the Court deems necessary or appropriate 

with respect to enforcement of the Plan.

17.Post-Confirmation Status Conference. The Court will conduct a 

post-confirmation status conference on July 28, 2021 at 1:30 p.m. The hearing will be 

conducted via Zoom Video Communications, Inc. For instructions regarding the video 

conference, please refer to the General Procedures for Hearings by Video Conference 

on Judge Grossman’s web page on the Court’s website, 

http://www.flsb.uscourts.gov/judges/judge-scott-m-grossman. To register for the 

video conference, click on the following link or manually enter the following link in a 

browser: 

https://www.zoomgov.com/meeting/register/vJIsceqsqzMtG7hezfpqRtlAFR1SzvHOb

JU

# # #

Submitted by:

Brian K. McMahon, P.A.

1401 Forum Way, 6th Floor

West Palm Beach, FL 33401

Tel (561) 478-2500

Fax (561) 478-3111

briankmcmahon@gmail.com

Attorney McMahon must serve a copy of the signed order on all parties served with 

the motion and must file with the court a certificate of service conforming with Local 

Rule 2002-1(F).

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