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UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

MIAMI DIVISION

www.flsb.uscourts.gov

In re: 

PERFORMANCE INSURANCE COMPANY SPC Chapter 15

Debtor in a Foreign Proceeding. Case No.: 21-12609-AJC

________________________________________/

MOTION TO AUTHORIZE DISTRIBUTION OF ESTATE FUNDS

HELD IN THE UNITED STATES TO THE CAYMAN ISLANDS

Kenneth Krys and Neil Dempsey (the “Foreign Representatives”), the Official Joint 

Liquidators of Performance Insurance Company SPC (the “SPC”) and ten of its twelve segregated 

portfolios1(collectively, the “Debtor”), file this Motion to Authorize Distribution of Estate Funds 

Held in the United States to The Cayman Islands (the “Motion”), to authorize the Foreign 

Representatives to repatriate the funds held in the U.S. bank accounts of the Debtor pertaining to 

its segregated portfolio Omega Insurance Company SP (“Omega SP”) to its corresponding bank 

accounts in the Cayman Islands so they can be administered in the Debtor’s foreign main 

proceeding. In support of their Motion, the Foreign Representatives state as follows:

 

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 The Debtor’s segregated portfolios are: (i) Bottini Insurance SP; (ii) Gen 1 Insurance 

Company SP; (iii) Goldenstar Holdings Company SP; (iv) Greystone Insurance SP; (v) Hudson 

York Insurance Company SP; (vi) Omega Insurance Company SP; (vii) Performance 5 SP; (viii) 

Prewett Insurance Company SP; (ix) Smart Insure SP; (x) SSS Insurance SP; (xi) Sustainable 

Insurance Company SP; and (xii) Triangle RGK SP. These twelve segregated portfolios are 

hereinafter referred to as the “Segregated Portfolios.” The Foreign Representatives are the Official 

Joint Liquidators for all segregated portfolios but not for Bottini Insurance SP and SSS Insurance 

SP. 

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RELEVANT FACTS

I. The Debtor and the Kentucky Litigation

1. The Debtor is a segregated portfolio company incorporated in the Cayman Islands

operating in the captive insurance industry through its 12 Segregated Portfolios. D.E. 2.

2. The Debtor is a defendant in a lawsuit commenced in 2019 in the United States 

District Court for the Western District of Kentucky, styled as Lexington Insurance Co., et al v. 

The Ambassador Group LLC, et al, Case No. 3:20-CV-00330-BJB-LLK (the “Kentucky Action”).

3. Among other things, the Kentucky Action sought injunctive relief against the SPC 

and some of its segregated portfolios. In connection with that relief, the Kentucky court entered 

two consent orders (the “Consent Orders”), one on May 14, 2020 and the other on October 13, 

2020. Part of the Consent Orders involves certain of the Debtor’s segregated portfolios (“Consent 

Order SPs”), including Omega SP, and the maintenance and use of the accounts held by or for the 

benefit of the Consent Order SPs (“Consent Order Accounts”). Among other things, the Consent 

Orders provide (in paragraph 5 of each order) that Performance “shall not transfer, diminish or 

dissipate” funds in the Consent Order Accounts “other than to adjust, pay or settle claims made 

by policyholders and certificate holders in the normal course.”

II. The Debtor’s Cayman Islands Liquidation

4. Due to the exposure to liability in litigation and its inability to generate income 

after the issuance of a desist order against it by the Cayman Islands Monetary Authority, the 

Debtor’s directors and its sole shareholder entered resolutions to wind up the Debtor on February 

26, 2021, thereby commencing its voluntary liquidation (the “Debtor’s Cayman Liquidation”). 

D.E. 2. The Debtor’s Cayman Liquidation became subject to the supervision of the Grand Court 

of the Cayman Islands (the “Cayman Court”) on April 7, 2021. D.E. 18.

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5. The plaintiffs in the Kentucky litigation have filed proofs of debt with the foreign 

representatives in the Debtor’s Cayman Liquidation. 

III. The Recognition of the Debtor’s Insolvency Proceeding Under Chapter 15

6. On March 19, 2021, the Foreign Representatives filed a petition and motion for 

recognition of the Debtor’s Cayman Liquidation under Chapter 15 of the Bankruptcy Code. D.E. 

1 & 2.

7. On April 15, 2021, the Court entered its Order Granting Recognition of Foreign 

Main Proceeding Pursuant to §§ 1515 and 1517 of the Bankruptcy Code and Granting Additional 

Relief (the “Recognition Order”). D.E. 17. The Recognition Order recognized the Debtor’s courtsupervised liquidation pending in the Cayman Islands as a foreign main proceeding and the 

Foreign Representatives as foreign representatives. D.E. 17. 

8. Among other things, the Recognition Order entrusts the Foreign Representatives 

with “the full administration and realization of all or part of the Debtor’s bankruptcy estate and 

assets within the territorial jurisdiction of the United States.” D.E. 17, at ¶ 3.

9. The Recognition Order also institutes the automatic stay under section 362 of the 

Bankruptcy Code, and specifically provides as follows: 

a. “All persons and entities are stayed from commencing or continuing any 

action or proceeding concerning the assets, rights, obligations or liabilities, 

of the Debtor or the Debtor’s bankruptcy estate, located in the United States.” 

D.E. 17, at ¶ 6 (emphasis added).

b. “All persons and entities are stayed from executing against the assets of the 

Debtor or the Debtor’s bankruptcy estate located in the United States.” D.E. 

17, ¶ 7.

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c. “All persons and entities are prohibited from transferring, encumbering or 

otherwise disposing of, or exercising control over any assets of the Debtor 

or the Debtor’s bankruptcy estate, located in the United States.” D.E. 17, ¶ 8

(emphasis added).

10. The Recognition Order also addresses the Consent Orders, and provides that the 

Foreign Representatives should not take any action inconsistent with the Consent Orders unless 

this Court granted leave to do so, as follows:

17. Notwithstanding anything in this Order to the contrary, by agreement of 

the Foreign Representatives: 

A. For Consent Order Accounts that are located in the territorial 

jurisdiction of the United States of America, the Foreign Representatives shall not 

take any action that is inconsistent with the Kentucky Consent Orders in regard to 

such Consent Order Accounts, unless the Foreign Representatives have sought and 

received, after notice and hearing, either consent of this Court to take such action 

or an adjudication from this Court that the Foreign Representatives may take 

such action notwithstanding the existence of the Kentucky Consent Orders.

B. For Consent Order Accounts that are located outside the territorial 

jurisdiction of the United States of America, the Foreign Representative shall not 

take any action that is inconsistent with the Kentucky Consent Orders in regard to 

such Consent Order Accounts unless the Foreign Representatives have sought and 

received, after notice and hearing, consent of the Court in the Foreign Main 

Proceeding to take such action. 

For avoidance of doubt, nothing in this Order is intended or should be 

construed to (a) prevent the litigants in the Kentucky Litigation to seek further relief 

from the Foreign Main Proceeding, or from this Court regarding the Consent Order 

Accounts or the Kentucky Litigation including requesting relief from the automatic 

stay, (b) prevent the Foreign Representative from obtaining signatory authority or 

similar rights over any bank account(s) that comprise the Consent Order Accounts 

or to cause the transfer of funds in any of those bank accounts to another banking 

institution in the same territorial jurisdiction if necessary for the purpose of gaining 

control in accordance with the statutory obligations of the Foreign Representatives, 

(c) effectuate a waiver of the rights, remedies, and defenses of the litigants in the 

Kentucky Litigation or the Foreign Representative regarding the impact of the 

automatic stay on the Kentucky Consent Orders, or (d) prevent this Court from 

considering any rulings or adjudications made by the Court in the Foreign Main 

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Proceeding with regard to the Consent Order Accounts or to communicate with 

such Court as permitted by law on such subject.

D.E. 17, ¶ 17 (emphasis added).2

IV. The Novation Settlements

11. The stakeholders of the Debtor’s segregated portfolios Gen 1 Insurance Company 

SP, Greystone Insurance SP, Prewett Insurance Company SP, Smart Insure SP, Triangle RGK SP, 

and Sustainable Insurance Company SP (the “Novated SPs”) entered into settlement agreements 

whereby their respective obligations and liabilities would be assigned to other captive insurance 

companies. D.E. 50 & 53. The Cayman Court approved these settlements. 

12. This Court granted the Foreign Representatives’ motions to authorize the 

distribution of the Novated SPs assets in the United States to permit the Foreign Representatives 

to implement the settlement agreements. D.E. 51 & 54. 

13. Though the settlements affected the Novated SPs, the settlements did not affect the 

Debtor’s six other segregated portfolios, including Omega SP. 

V. The Cayman Remuneration Order

14. On August 24, 2022, the Grand Court of the Cayman Islands overseeing the 

Debtor’s official liquidation entered an Order (the “Remuneration Order”) approving the 

remuneration and expenses of the Foreign Representatives up to and including July 31, 2021,

under Cayman Islands law with respect to their remuneration agreements as to the SPC and four 

of its segregated portfolios Goldenstar Holdings Company SP, Omega SP, Hudson York Insurance 

 

2 The entry of the Recognition Order and the additional relief granted under section 1521(1) 

& (2), stayed the enforceability of the Consent Orders as to the Consent Order SPs and the Consent 

Order Accounts. See 11 U.S.C. § 1520(a)(1) & 1521(a)(1) & (2); In re C.W. Min. Co., No. 08-

20105, 2008 WL 3539795, at *3 (Bankr. D. Utah Aug. 7, 2008) (enforcing automatic stay to 

prevent enforcement of prepetition injunction against the debtor). 

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Company SP, and Performance 5 SP. The “Remuneration Order” is attached hereto as “Exhibit 

A”.

15. The Remuneration Order further authorizes the Foreign Representatives to make 

an interim payment for 80% of their remuneration and 100% of their expenses, including legal 

fees, incurred from August 1, 2021 onwards. Ex. A, ¶ 5. The Remuneration Order further 

authorizes the Foreign Representatives “to make any applications in other court outside of the

Cayman Islands in order to give effect to the approval and payment of the [Foreign 

Representatives] past and future remuneration and expenses in respect of the [Debtor] and the 

Subject SPs.” Ex. A, ¶ 6.

RELIEF REQUESTED AND BASIS FOR RELIEF

16. Pursuant to 11 U.S.C. §§ 1521(a)(7) & 1521(b), the Foreign Representatives 

request an order from the Court entrusting them with the distribution of the funds located in the 

accounts Omega SP in the United States (the “US Accounts”) to the Cayman Islands to permit the 

Foreign Representatives to administer these funds in connection with the Debtor’s Cayman

Liquidation. 

17. Pursuant to section 1521(a)(5), the Court has entrusted the Foreign Representatives 

with the “full administration or realization of all or part of the Debtor’s bankruptcy estate and 

assets within the territorial jurisdiction of the United States.” D.E. 17, at ¶ 3; see 11 U.S.C. § 

1521(a)(5).

18. Under section 1521(b), the court may “entrust the distribution of all or part of the 

debtor’s assets located in the United States to the foreign representative ... provided that the court 

is satisfied that the interest of creditors in the United States are sufficiently protected.” 11 U.S.C. 

§ 1521(b). “This alternative provision allows the debtor’s estate to exit the United States for 

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distribution.” In re Agrokor d.d., 591 B.R. 163, 188 (Bankr. S.D.N.Y. 2018); see In re British Am. 

Ins. Co., 488 B.R. 205, 225 (Bankr. S.D. Fla. 2013). This relief is conditioned, however, on 

whether the interests of U.S. creditors are “sufficiently protected.” 11 U.S.C. § 1521(b). 

Additionally, any relief under section 1521(b) may only be granted “if the interests of creditors 

and other interested entities, including the debtor, are sufficiently protected.” 11 U.S.C. § 1522(a).

19. Accordingly, “a bankruptcy court must be satisfied that local creditors’ interests are 

‘sufficiently protected’ before allowing a foreign representative to distribute property in a foreign 

proceeding, and though not an express requirement, is not precluded from satisfying itself that 

foreign creditors are ‘sufficiently protected’ before allowing a foreign representative to distribute 

property in a foreign proceeding.” SNP Boat Serv. S.A. v. Hotel Le St. James, 483 B.R. 776 (Bankr. 

S.D. Fla. 2012). 

20. Courts consider the following three factors in determining whether a creditor is 

afforded “sufficient protection”: (i) the just treatment of all holders of claims against the 

bankruptcy estate; (ii) the protection of U.S. claimants against prejudice and inconvenience in the 

processing of claims in the [foreign] proceeding; and (iii) the distribution of proceeds of the foreign 

estate substantially in accordance with the order prescribed by U.S. law. In re Markus, 610 B.R. 

64, 76 (Bankr. S.D.N.Y. 2019), aff'd, 620 B.R. 31 (S.D.N.Y. 2020).

21. There is no doubt that the Debtor’s U.S. creditors are afforded “sufficient 

protection.” The Debtor’s estate is governed by the Cayman Islands Companies Act (the 

“Companies Act”), which is applicable to all company insolvencies in the Cayman Islands. 

Accordingly, the assets of the Debtor and its segregated portfolios are subject to the Foreign 

Representatives’ exclusive control for the purpose of their liquidations. Companies Act, Sec. 110. 

The Companies Act affords creditors the right to file a proof of debt regarding any claim they may 

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have against the Debtor, Companies Act, Sec. 139, and the Plaintiffs in the Kentucky Action have 

filed proofs of debt in the Debtor’s Cayman Liquidation. Further, the Companies Act does not 

distinguish or otherwise prejudice the claims of local creditors from the claims of foreign creditors, 

such as the Debtor’s U.S. creditors. Companies Act, Secs. 139, 140, 141 & 142. Accordingly, 

the holders of claims against the Debtor’s estate are treated fairly and U.S. claimants are neither 

prejudiced nor inconvenienced by processing their claims in the Cayman Liquidation. 

22. Third, the distribution of the estate in a liquidation scenario under the Companies 

Act is similar to the scheme under the U.S. Bankruptcy Code. The Companies Act, provides 

priority of payment to “preferred” and secured creditors, then payment of non-secured and nonpreferred creditors in a pari passu basis, and finally to equity interests. Companies Act, Sec. 140.

23. Importantly, the relief sought is necessary to effectuate the purposes of chapter 15

of promoting the fair and efficient administration of the Debtor’s foreign estate located in the 

Cayman Islands by centralizing the claims against the estate and distribution in the forum of the 

main foreign proceeding. 

WHEREFORE, the Foreign Representatives request that the Court enter an order, 

substantially in the form of Exhibit “A”, granting this Motion and permit the Foreign 

Representatives to distribute the funds of Omega SP to the Cayman Islands.

I HEREBY CERTIFY that a true and correct copy of the foregoing has been served upon 

all interested parties registered to receive notice via this Court’s CM/ECF electronic notification 

system on October 31, 2022.

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Dated: October 31, 2022 Respectfully submitted,

SEQUOR LAW, P.A.

1111 Brickell Avenue, Suite 1250 

Miami, Florida 33131

Telephone: (305) 372-8282 

Facsimile: (305) 372-8202

Email: ggrossman@sequorlaw.com

jmendoza@sequorlaw.com 

By: /s/ Gregory S. Grossman

Gregory S. Grossman

Florida Bar No. 896667

Juan J. Mendoza

Florida Bar No.: 113587

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing was filed via electronic 

filing using the CM/ECF system with the Clerk of the Court which sent e-mail notification of such 

filing to all CM/ECF participants in this case and via regular US mail to all participants who are 

not on the list to receive e-mail notice/service for this case as indicated on the service list on 

October 31, 2022.

By: /s/ Gregory S. Grossman

Gregory S. Grossman

Case 21-12609-AJC Doc 56 Filed 10/31/22 Page 9 of 12
EXHIBIT A 

Case 21-12609-AJC Doc 56 Filed 10/31/22 Page 10 of 12
UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

MIAMI DIVISION

www.flsb.uscourts.gov

In re: 

PERFORMANCE INSURANCE COMPANY SPC Chapter 15

Debtor in a Foreign Proceeding. Case No.: 21-12609-AJC

________________________________________/

ORDER GRANTING MOTION TO AUTHORIZE DISTRIBUTION OF 

ESTATE FUNDS HELD IN THE UNITED STATES TO THE CAYMAN ISLANDS

THIS CAUSE came before the Court on __________ ___, 2022, (the “Hearing”) upon the 

Motion to Authorize the Distribution of Estate Funds Held in the United States to the Cayman 

Islands (the “Motion”) [DE ___] filed by Kenneth Krys and Neil Dempsey (the “Foreign 

Representatives”), the Official Joint Liquidators of Performance Insurance Company SPC and ten 

Case 21-12609-AJC Doc 56 Filed 10/31/22 Page 11 of 12
of its twelve segregated portfolios1 (collectively, the “Debtor”). The Court has considered the 

Motion, the record, and arguments of counsel for the Foreign Representatives at the Hearing, the 

Court finds that the interests of the Debtor’s U.S. creditors are sufficiently protected under the 

Debtor’s Cayman Liquidation. Accordingly, it is 

ORDERED that:

1. The Motion is GRANTED as set forth below.

2. The Foreign Representatives are authorized and entrusted with the distribution of

the funds in the United States bank accounts of segregated portfolio Omega Insurance Company 

SP, to such accounts in the Cayman Islands as specified by the Foreign Representatives. 

###

Submitted by:

Gregory S. Grossman, Esq.

Juan J. Mendoza, Esq.

SEQUOR LAW, P.A.

1111 Brickell Avenue, Suite 1250

Miami, Florida 33131

ggrossman@sequorlaw.com

jmendoza@sequorlaw.com

Telephone: (305) 372-8282

(Juan J. Mendoza is directed to serve a copy of this order upon all interested parties who do not 

receive service by CM/ECF and file a proof of service within three days of entry of this order)

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 The Debtor’s segregated portfolios are: (i) Bottini Insurance SP; (ii) Gen 1 Insurance 

Company SP; (iii) Goldenstar Holdings Company SP; (iv) Greystone Insurance SP; (v) Hudson 

York Insurance Company SP; (vi) Omega Insurance Company SP; (vii) Performance 5 SP; (viii) 

Prewett Insurance Company SP; (ix) Smart Insure SP; (x) SSS Insurance SP; (xi) Sustainable 

Insurance Company SP; and (xii) Triangle RGK SP. These twelve segregated portfolios are 

hereinafter referred to as the “Segregated Portfolios.” The Foreign Representatives are the Official 

Joint Liquidators for all segregated portfolios but not for Bottini Insurance SP and SSS Insurance 

SP. 

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