Firm News
Schulte Advises Greenvale Capital in 2U’s Successful Restructuring
September 16, 2024
Schulte Roth & Zabel LLP advised Greenvale Capital LLP (together with its affiliated funds and accounts, “Greenvale”), a significant former convertible noteholder and lender under the debtor-in-possession (“DIP”) financing facility, in connection with 2U, Inc.’s successful financial restructuring and emergence from chapter 11. Under 2U’s chapter 11 plan, Greenvale received equity in reorganized 2U in exchange for its convertible notes claims and participation in the equity rights offering, the proceeds of which were used to make distributions under 2U’s chapter 11 plan and fund general corporate purposes. Greenvale’s DIP facility claims were converted into loans under an exit second-lien credit facility.
The Schulte team was led by Kristine Manoukian, co-chair of Schulte’s Business Reorganization Group, and included M&A and Securities partner David Curtiss, Finance partner Gregory Ruback, Tax partner Joseph Reich, Business Reorganization associates Kelly Knight and Reuben Dizengoff, M&A and Securities associates Mitchell DaSilva and Julia Cummings, and Tax associate Moshe Mashitz, among others.
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Alerts
On Aug. 19, 2024, the US Securities and Exchange Commission (the “SEC”) charged Obra Capital Management, LLC (“Obra Capital”) with violations of Rule 206(4)-5 under the Investment Advisers Act of 1940, otherwise known as the “Pay-to-Play Rule” (the “Rule”), arising out of a $7,150 campaign contribution made by an individual prior to joining Obra Capital.[1] This campaign contribution was made to a government official in Michigan who had influence over hiring investment advisers for the Michigan Public Employees’ Retirement Fund (the “Michigan Pension Fund”), which was an investor in a fund managed by Obra Capital (the “Obra Fund”). Notably, the Michigan Pension Fund had been an investor in the Obra Fund for several years prior to the hiring of the individual who made the contribution. And perhaps even more notably, this campaign contribution was made several months prior to the individual becoming a “Covered Associate” (as defined by the Rule[2]) of Obra Capital. By virtue of Obra Capital continuing to provide investment advisory services for compensation to the Obra Fund in which the Michigan Pension Fund was invested after hiring the individual, Obra Capital violated the Rule and agreed to pay a $95,000 fine to settle the charges.
Alerts
On Aug. 19, 2024, the US Securities and Exchange Commission (the “SEC”) charged Obra Capital Management, LLC (“Obra Capital”) with violations of Rule 206(4)-5 under the Investment Advisers Act of 1940, otherwise known as the “Pay-to-Play Rule” (the “Rule”), arising out of a $7,150 campaign contribution made by an individual prior to joining Obra Capital.[1] This campaign contribution was made to a government official in Michigan who had influence over hiring investment advisers for the Michigan Public Employees’ Retirement Fund (the “Michigan Pension Fund”), which was an investor in a fund managed by Obra Capital (the “Obra Fund”). Notably, the Michigan Pension Fund had been an investor in the Obra Fund for several years prior to the hiring of the individual who made the contribution. And perhaps even more notably, this campaign contribution was made several months prior to the individual becoming a “Covered Associate” (as defined by the Rule[2]) of Obra Capital. By virtue of Obra Capital continuing to provide investment advisory services for compensation to the Obra Fund in which the Michigan Pension Fund was invested after hiring the individual, Obra Capital violated the Rule and agreed to pay a $95,000 fine to settle the charges.