Lawyers for The Greenbrier, responding to a judge’s ultimatum, say they are close to completion of a $500 million financing deal with the New York firm Kennedy Lewis Investment Management but are asking the court for more time.
The attorneys for The Greenbrier say more time is necessary to work through complications like the sheer size of the financial deal, regulatory oversight of the casino license and the finer details of a resulting joint venture.
“As they have from the start, Defendants and KLIM will continue working diligently to push the transaction across the finish line, and they anticipate being able to do so by August 7, 2026,” wrote lawyers for The Greenbrier.
Judge Frank Volk, who is overseeing a federal lawsuit over control of The Greenbrier, ordered a filing about where the financing deal stands by 8:30 a.m. today. Lawyers for The Greenbrier filed several minutes before that time hit.
The lawyers for The Greenbrier also filed a motion to continue the proceedings.
The response to the judge’s show cause order includes a statement from representatives of The Greenbrier’s potential financing partner, Kennedy Lewis Investment Management, reiterating its commitment to the deal.
“KLIM agrees that the transaction parties are working diligently to consummate the anticipated transaction as quickly as reasonably possible, subject to the completion of definitive transaction documents and certain conditions precedent to closing,” wrote the representatives of Kennedy Lewis Investment Management.
Lawyers for The Greenbrier are requesting that the court grant until August 7 to finalize the $500 million refinancing transaction. The attorneys characterize the request as a “brief additional period” and a “further limited extension.”
From today, it’s almost three more weeks.
If the transaction has not closed by this date, the lawyers for The Greenbrier propose the court order an immediate inquiry by a magistrate judge into the circumstances of the delay.
Lawyers for The Greenbrier emphasized that the potential is is particularly complex because of its $500 million amount, the many entities involved, the effects on parcels of real property “and the fact that the transaction is not merely a loan but a joint venture, which required the negotiation and delineation of the terms of the relationship between the transacting parties.
“The parties to the deal have worked diligently throughout the process and have moved forward with remarkable speed given its size and complications. There is nothing unusual or improper about a transaction taking longer to close than its participants originally had hoped, despite the best efforts of those involved.”
Volk is overseeing a case where the Omni Hotels affiliate White Sulphur Springs Holdings owns about $300 million in first-lien debt on The Greenbrier Hotel. Lawyers for the holding company say their collateral is at risk, and they’ve been asking the judge to appoint a third-party receiver to oversee the hotel while pushing out the owners, Senator Jim Justice and his family business.
The Justices and their Greenbrier Hotel Corporation say the $500 million deal could pay off White Sulphur Springs Holdings and other entities owed money while also providing enough to invest in long-needed hotel improvements.
On May 22, lawyers for the Justices requested a delay in court activity for 60 days to work toward completion of the deal.
On May 30, Volk then granted the delay “with the expectation that closing will occur on or before July 16, 2026.”
Volk had indicated that if there’s a push to delay beyond that, the court’s patience could grow thin.
“If Defendants seek further extensions for either (1) more extended negotiations with, or financing due diligence by, the financing partner, or (2) to allow additional forays with other lenders, the balance of prejudice will likely shift rather abruptly,” Volk wrote.
That date has come and gone, but with a bunch of back-and-forth.
Volk entered a show cause order on Sunday telling lawyers for The Greenbrier to put in writing why the court should not move ahead with proceedings that have been delayed more than a month.
The lawyers for The Greenbrier say they need enough time to resolve issues that they they say are not entirely within their control, such as regulatory approvals and the “timely cooperation” of White Sulphur Springs Holding regarding lien releases.
The three outstanding matters described by The Greenbrier attorneys include:
West Virginia Lottery Commission approval: The deal requires the lottery commission to review and approve the transaction as it relates to The Greenbrier’s casino license.
Title insurance: Because the transaction involves dozens of parcels of real property, it requires title insurance from a third-party company.
Lien releases: Lawyers for The Greenbrier are aiming to gain lien releases to meet the transaction’s requirements. Doing so requires reaching agreement with White Sulphur Springs Holdings.
The lawyers for The Greenbrier propose filing status reports on July 27 to confirm that all transaction documents have been completed, on July 31 for an update on the lottery commission review, the title insurance and the lien releases and August 7 as a final deadline.
Lawyers for The Greenbrier maintain that the transaction is nearing its finish line and that resuming receivership proceedings now could derail the deal entirely.
“The refinancing transaction will stabilize Defendants’ finances and provide funding for The Greenbrier to preserve and build upon its nearly 250-year heritage. In so doing, it will benefit The Greenbrier’s employees, the local economy, and the entire state. A receivership, by contrast, would put the refinancing and all its associated benefits at serious risk for no good reason,” wrote attorneys for The Greenbrier.
“Defendants are not asking for a few months to close the deal. Rather, they seek only a brief period to complete their transaction documents and for the aspects of the transaction that are not within their control to reach a reasonable conclusion. Receivership proceedings would not be justified under the facts of this matter, and a further continuance is warranted.”