Metronomic receives court approval of settlement with Fuse Funding

By Sarah Lizee

Olympia, Wash., May 5 – Metronomic Holdings, LLC received court approval of a settlement with secured creditor Fuse Funding Fund I, LLC, according to an order filed Wednesday with the U.S. Bankruptcy Court for the Southern District of Florida.

Metronomic had said in its motion that after mediation and months of negotiations between the debtor and Fuse, on Dec. 10, they entered a memorandum of understanding, which memorialized certain sale and disposition procedures for 19 properties upon which Fuse holds a first-position mortgage.

Under the MOU, proceeds of the sales of the Fuse portfolio properties would be first applied to Fuse’s hypothetical stated interest secured claim amount.

The next $150,000 of proceeds were to be earmarked for the payment of allowed administrative expenses for professional fees and costs in the Chapter 11 case.

Proceeds in excess of the professional fee carveout were to be paid to Fuse until Fuse’s allowed secured claim was paid in full, and thereafter any proceeds were to be made available to the debtor’s estate.

“After completion of the auction process of the Fuse portfolio properties, it became clear that potential proceeds from the sale of the Fuse portfolio properties would be insufficient to pay the hypothetical stated interest fuse secured claim amount and, accordingly, no proceeds were or could be made available for the professional fee carveout or for the payment of claims of other parties in interest in this Chapter 11 case without a direct infusion of cash by Fuse,” Metronomic said.

After further negotiations between the debtor and Fuse, Fuse agreed to voluntarily provide the debtor’s estate with a $100,000 carveout from the proceeds of the sales of the Fuse portfolio properties located in Illinois for the payment of allowed administrative expenses for professional fees and costs; pay the commissions of the debtor’s real estate broker, Hilco Real Estate, in connection with the sale of the two Illinois properties; pay the due and outstanding ad valorem real estate taxes on the Fuse portfolio properties; and pay all valid, properly-filed, perfected, and superior lien claims held against the two Illinois properties, all in exchange for a general and mutual settlement and release with Metronomic.

Metronomic is a Coral Gables, Fla.-based sustainable real estate developer. The company filed Chapter 11 bankruptcy on Sept. 23, 2020 under case number 20-20310.

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