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Bicycle Racing News and Opinion,
Tuesday, November 10, 2020

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2020 Tour de France | 2019 Giro d'Italia

Money doesn't talk, it swears. - Bob Dylan

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Nikolas Maes will be a team director at Lotto Soudal

Lotto-Soudal sent me this release:

From January 1st, Nikolas Maes will join the group of Lotto Soudal team directors with a very specific schedule. Maes, a professional cyclist for fourteen years, announced his retirement as a cyclist two weeks ago.

"I am already preparing for my second career in the construction and real estate industry but I cannot pass up the opportunity to lend a hand to Lotto Soudal. Cycling is and will always be my passion,” explains Nikolas Maes.

"We love not to waste the expertise we have in-house," continues John Lelangue, General Manager of Lotto Soudal. "We are continuing what we started last year with Maxime Monfort, our new Performance Manager. Nikolas will be deployed in the spring and will take care of the youth in the team. He has plenty of experience and knows the house like the back of his hand. Over the past four seasons, Nikolas has shown himself to be an indispensable link at Lotto Soudal during the spring classics."

“The classics are my field. The team is counting on my experience, but I am also looking forward to integrating all those many young, new and youthful talents into the team. This is a project that I like to put my shoulders under. 2021 will be very instructive year for me,” Nikolas Maes concludes.

Advanced Sports Enterprises trustee tries to claw back millions in preferential payments

Bicycle Retailer & Industry News sent me this:

DURHAM, N.C. (BRAIN) — Nearly two years after Advanced Sports Enterprises and its subsidiaries filed for bankruptcy, ASE's brands have moved on to new lives: Performance Bike, Nashbar, and the former ASI bike brands of Fuji, Kestrel, SE, and others have new owners distinct from the old company.

But the case continues and the estate for ASE, now named AE Bike Liquidation, Inc., is now trying to recover so-called "preferential payments" that suppliers received from Performance and the other brands in the weeks before than bankruptcy filing in November 2018.

Bankruptcy law generally allows the trustee for the estate to recover those payments;  the proceeds are added to the estate's assets and eventually distributed to the creditors.

In August, the estate's trustee sent demand letters to 30 suppliers, offering to settle the debt for a bit less than the total. It reached settlements with 16 companies, recovering $355,000.  On Friday, the trustee sued 14 companies that have not agreed to settle, seeking $2.1 million in judgments.

The founder of one company that received a demand letter in August said it left him feeling "violated."

"Just when you think the (expletive deleted, take your pick) at Performance couldn't screw you more, this comes up," he said in an email to BRAIN this summer.

"We wrote off a bunch in the bankruptcy, and now they want us to give them more. I'm learning it's part of the bankruptcy process, but definitely feel violated. It's amazing how the bad business decisions of some, keep on giving to legitimate businesses. Some formerly respected people in the industry keep on giving a lot of pain."

Companies that reached settlements include Saris Cycling, Vittoria North America, Accell North America, Park Tool, GU, and J&B. The court has approved the settlements with Park, Saris, Vittoria and ANA. It has not yet approved the settlements with CatEye, GU and J&B. Hearings are scheduled on those settlements later this month.

Bike industry companies sued Friday include Shanghai Global Sports, Clif Bar & Co., Active Cycle, Skratch Labs, Shimano, and PT Insera Sena. (Individual judgment amounts demanded is below).

The preferential clawbacks are especially galling to some suppliers because they are often unsecured creditors to the bankruptcy as well. So they are owed money for services or goods they delivered after the bankruptcy, and have little hope they will receive more than pennies on the dollar for that debt. Then on top of that, they are now asked to return the payments they did receive.

But, that's the law. The reasoning is that the policy discourages aggressive collection activities that can force a debtor into bankruptcy. It also curtails companies that are on a path to bankruptcy from paying friends or insiders while they can, at the expense of other creditors.

There are some defenses against a preference suit. The defendant (the supplier) can argue that the payment was received "in the ordinary course of business," such as a monthly utility bill.

They also can use the "new value defense" and show that goods or services were provided to the debtor after one or more of the preference payments were made. Then the value of those new goods are services can offset the preference payment.

The trustees anticipated the new value defense and the settlements proposals subtracted any known new values the trustee could document.

The suits filed also account for the new value defense. For example, Shimano received payments from the ASI companies totaling over $731,000 in the weeks prior to the bankruptcy. But Shimano then provided new goods valued at $530,000, according to the trustee. So the suit is seeking a judgment of $197,000 from Shimano.

You can read the entire story here.

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