IN RE: Dark Rhiino Security (2026)

Chapter 11

Subchapter V

MEMORANDUM OPINION CONFIRMING FIRST AMENDED PLAN OF REORGANIZATION OF DARK RHIINO SECURITY, INC.

Subchapter V Debtor In Possession Dark Rhiino Security, Inc. (the “Debtor”) seeks confirmation of its First Amended Plan of Reorganization (the “Plan”).¹ Headquartered in Dublin, Ohio, the Debtor provides managed cybersecurity services, technology and training to mid-size businesses and provides internet hosting services to over a hundred customers with hundreds of thousands of members.² The Debtor has four shareholders. Two of the shareholders are current employees: Manoj Tandon (“Mr. Tandon”), the Debtor's Chief Executive Officer, and Robert T. Smith (“Mr. Smith”), its Chief Technology Officer and President.³ The other two shareholders were prior employees of the Debtor: Kevin Casey (“Mr. Casey”), the former CEO, and Anna Day (“Ms. Day”).⁴ The Plan is non-consensual because impaired classes have not accepted it.

For the reasons elaborated below, the Plan meets the applicable requirements of the Bankruptcy Code and will be confirmed. A settlement between the Debtor and Ms. Day was announced at the confirmation hearing held on February 2, 2026 (the “Confirmation Hearing”), resulting in her withdrawal of her objection to the Plan,⁵ and the objections of Mr. Casey ⁶ not otherwise resolved by agreement on the record are overruled.

I. BACKGROUND

A. THE BUSINESS DIVORCE

This case centers around what has been described as a “toxic business divorce.”⁷ When this case began, the Debtor asserted that, in addition to the COVID-19 pandemic, its financial hardship was due to the alleged mismanagement and misconduct of Mr. Casey, whom the Debtor further alleges misappropriated company funds for personal and lifestyle expenses; incurred debt without shareholder consent; concealed a romantic relationship with, and made certain payments to, an employee; and hid from the other shareholders certain lawsuits filed against the Debtor.⁸ The Debtor explained that these allegations precipitated its termination of Mr. Casey in February 2024, prior to the time the Debtor commenced its bankruptcy case.⁹ These allegations remain punctuated by the Debtor in its proposed Plan.¹⁰ While this Court makes no findings today as to whether these allegations are true or false, they may explain the Court-perceived animosity between the Debtor's current management and Mr. Casey. This in turn, adds context to the contested matter before it, which centers around the Plan treatment of Mr. Casey, as both a creditor and interest holder. At the Confirmation Hearing, the Debtor's counsel continued to characterize this case as a contentious business divorce among shareholders, but counsel for both the Debtor and Mr. Casey agreed that all affected parties gave good faith efforts towards settlement.¹¹

B. THE PROPOSED PLAN

With the parties’ disputes unresolved despite such good faith efforts, the Debtor's proposed Plan is a toggle plan, the treatment thereunder dependent upon the outcome of future, Casey/Day Litigation,¹² which the Debtor explains in its Plan would object to the claims of Mr. Casey and Ms. Day; seek subordination of such claims; and seek recovery on claims against them, with offset as appropriate. The Plan proposes to pay non-priority, unsecured claims (Class 3) the Debtor's projected disposable income over three years in the total amount of $241,310.00, which the Plan explains translates to between approximately 11.7% and 16.1% of Class 3 claims, depending upon the outcome of the Casey/Day Litigation. To the extent that the Casey/Day Litigation generates net proceeds, such net proceeds would also be paid to the claimants in this class; on the flip side, to the extent such litigation instead results in allowed claims of Casey and/or Day, the Plan also proposes to reserve sufficient funds to pay them as allowed, Class 3 claimants.¹³

Separately, the Plan further provides treatment in Class 5 of shareholder interests as follows:

All shareholders will retain the value of their shares. Mr. Smith and Mr. Tandon will retain their interests in the Debtor. Under principles of equitable subordination, the Debtor will acquire the interests of Mr. Casey and Ms. Day by paying to each shareholder the difference between (a) the value of that shareholder's shares as determined by a professional valuation analyst or as agreed to by the parties minus (b) the amount of any judgment obtained against that shareholder in the Casey/Day Litigation or the amount of liability agreed to by the parties. Any payments due under this Class 5 will be made over 60 months in quarter annual installments beginning in the quarter following the completion of payments to Class 3 creditors above. In the event the Debtor collects on any judgment in excess of the value of shares, i.e., (b) above exceeds (a) above, the excess will be distributed to Class 3 creditors.14

C. REMAINING OBJECTION TO CONFIRMATION

Mr. Casey initially objected to confirmation of the Plan on several grounds, which can be summarized as follows: 1) a five-year payment period rather than a three-year period should be used for all unsecured claims; 2) the Plan fails to articulate how reserves to potentially pay later-allowed Mr. Casey claims are held and thus may be subject to existing or future liens; 3) the Plan is unclear as to whether Mr. Casey's defenses he may raise in a future adversary proceeding are retained; and 4) Mr. Casey's equity interest should remain in place absent further order of the Court and should not be valued by an appraiser chosen by Debtor.¹⁵ Except for the first-enumerated objection and a related, factual issue raised as to the projections, all other objections have been resolved, either through the Plan's amendment to the Original Plan or through clarification and agreement confirmed on the record.¹⁶

D. THE CONFIRMATION HEARING

The Court conducted the Confirmation Hearing on February 2, 2026, at which arguments were made and evidence introduced, which is discussed further below. Based on Court inquiry during the Confirmation Hearing, Mr. Casey requested an opportunity to research and brief further. After further briefing was filed by Mr. Casey and the Debtor, the Court held a further hearing on March 3, 2026. The anticipated withdrawal of the objection of Ms. Day and attendant 9019 settlement motion remained outstanding, prompting a further status conference on April 2, 2026. As noted above, the Day objection has now been withdrawn.

II. ANALYSIS

With the above-discussed resolutions and clarifications, the issues before the Court are streamlined as follows: 1) Casey's objections contending that the Plan should require a five-year versus three-year commitment period and raising a factual question of whether the projections show all disposable income being committed, and 2) this Court's independent duty to confirm the Plan's compliance with the Bankruptcy Code. As discussed below, the Plan meets the applicable requirements of the Bankruptcy Code, including §§ 1123,¹⁷ 1190 and 1191(b).¹⁸

A. THE COURT'S INDEPENDENT DUTY:

The Court will first address its independent duty to determine that the Plan contains the provisions set forth in §§ 1123 and 1190 and satisfies § 1191(b).¹⁹ The Debtor must demonstrate compliance with each statutory requirement for confirmation of a Subchapter V Chapter 11 plan by a preponderance of the evidence. To meet that burden, at the Confirmation Hearing, the Debtor offered into evidence exhibits and the testimony of Mr. Tandon. Mr. Tandon was cross-examined by Mr. Casey. Mr. Casey did not move any exhibits into evidence, asking the Court to instead take judicial notice of the Debtor's monthly operating reports,²⁰ which the Court takes to the extent permitted under Federal Rule of Evidence 201(b).

1. PLAN CONTENTS

a. § 1190

The Bankruptcy Code provides that the contents of a Subchapter V plan:

(1) shall include—

(A) a brief history of the business operations of the debtor;

(B) a liquidation analysis; and

(C) projections with respect to the ability of the debtor to make payments under the proposed plan of reorganization;

(2) shall provide for the submission of all or such portion of the future earnings or other future income of the debtor to the supervision and control of the trustee as is necessary for the execution of the plan; and

(3) [not applicable to this case 21].22

Here, the Plan includes a history of the business, a liquidation analysis and cash flow projections; provides that the Subchapter V Trustee shall be the disbursing agent for Classes 3 and 4 under the Plan; and, by agreement, requires that funds sufficient to pay Mr. Casey as a Class 3 creditor will be paid to the Subchapter V Trustee to be held pending a determination of whether his unsecured claim is allowed or disallowed through the retained litigation.²³ Additionally, the record further supports that the contents of a plan required under Bankruptcy Code § 1123 exist (with the exception of §§ 1123(a)(8) and 1123(c), which are inapplicable in a Subchapter V case pursuant to § 1181(a)).²⁴

b. § 1123

As noted, among other things, § 1129(a)(1) requires that the Plan complies with the applicable provisions of the Bankruptcy Code. This includes compliance with § 1123(a)(4). Pertinent to an analysis of interest holders in Class 5, § 1123(a)(4) requires a Chapter 11 plan to “provide the same treatment for each ․ interest of a particular class, unless the holder of a particular ․ interest agrees to a less favorable treatment of such particular ․ interest.”²⁵

Here, the Court concludes that § 1123(a)(4) is satisfied. First, § 1123(a)(4) is satisfied by agreement: the Debtor and Mr. Casey agree that the valuation of his equity interest will be made by judicial determination or by further agreement between the parties; with this valuation process, Mr. Casey further agrees that the Plan can provide for the partial redemption of shares, such that § 1123(a)(4) is then satisfied for purposes of plan confirmation.²⁶ Even if one were to conclude that Mr. Casey's agreement to have his interests redeemed does not satisfy § 1123(a)(4) due to his remaining objections, the Court concludes that the “same treatment” requirement is separately satisfied. Courts have clarified that “same treatment” means that “all members of the class must receive equal value.”²⁷ Aligned with the Quigley equal value requirement, Class 5 is clear: “All shareholders will retain the value of their shares,” albeit with two shareholders retaining their shares to receive that value, with Mr. Casey instead receiving that value through consented-to redemption after an agreed valuation process.²⁸

Based on the record before it, the Court concludes that all other requirements of § 1123(a) applicable in a Subchapter V case are also met.

2. NON-CONSENSUAL PLAN UNDER § 1191(B)

Where, as here, a Subchapter V proposed plan is non-consensual, Bankruptcy Code § 1191(b) applies, which in turn incorporates by reference the requirements of § 1129(a), except paragraphs (8), (10), and (15). If these § 1129(a) requirements are satisfied, then this Court “shall confirm the [P]lan notwithstanding the requirements of [paragraphs (8), (10), and (15)] if the [P]lan does not discriminate unfairly, and is fair and equitable, with respect to each class of claims or interests that is impaired under, and has not accepted, the [P]lan.”²⁹

a. § 1129(a) Requirements Satisfied

This Court first finds that the applicable requirements of § 1129(a) incorporated into § 1191(b) are satisfied as follows:

• § 1129(a)(1) and (2) requires that the Plan and plan proponents comply with the applicable provisions of the Bankruptcy Code. They do.30 Above, the Court elaborates on compliance with § 1123(a)(4) in particular.

• § 1129(a)(3) dictates that this Court find that the Plan was proposed in good faith and not by any means forbidden by law. No filed objection disputes this finding. Mr. Tandon testified to the Debtor's good faith in proposing the Plan, and the Court found his testimony credible and unchallenged on this point.31

• § 1129(a)(4) requires that any payments made or to be made by the Debtor or the Estate for costs and expenses in connection with the case be approved as reasonable. The Plan is supported by projections, which Mr. Tandon testified were conservative.32 For any fees and costs that must be Court approved, this Court will not approve any fees or expenses that are unreasonable. The Plan thus complies with § 1129(a)(4).

• § 1129(a)(5) requires the Debtor to disclose the identify and affiliations of anyone proposed to serve post-confirmation as director or officer, as well as the nature of any insider compensation. The Plan does this as well.

• § 1129(a)(6) is inapplicable because there is no regulatory or rate change involved.

• § 1129(a)(7) requires that the Debtor shows each holder of an impaired claim or interest has either “accepted the plan” or would receive under the Plan, value that is not less than the amount they would receive in a hypothetical Chapter 7. The record shows that this “best interests of creditors” test is satisfied.33

• §§ 1129(a)(8) and (10) are not satisfied but the Plan may still be confirmed as a non-consensual plan under § 1191(b).

• § 1129(a)(9) provides for payment of priority claims on the effective date of the plan “[e]xcept to the extent that the holder of a particular claim has agreed to a different treatment of such claim.”34 Articles 3 and 4 of the Plan provide for payment of administrative and priority claims on the later of the Effective Date of the Plan or the date on which such a claim is allowed. No claimant objected to this, so the treatment is agreed to by any such affected claimant.35

• § 1129(a)(11) requires a finding that confirmation of the Plan “is not likely to be followed by the liquidation, or the need for further financial reorganization, of the [D]ebtor or any successor to the [D]ebtor under the [P]lan.”36 The Court makes this finding. Among other facts in the record, Mr. Tandon testified that for the first time, the Debtor was cash flow positive and paid taxes in 2025 and appears to have a significant tax bill this year due to making a profit.37 The Debtor has added nine new clients despite a miniscule marketing budget.38

• § 1129(a)(12) is satisfied because “[t]here are no statutory fees required to be paid under 28 U.S.C. § 1930 that are owed on or before the Effective Date of this Plan.”39

• §§ 1129(a)(13) (retiree benefits), (14) (domestic support), (15)40 (for individual debtors), and (16) (transfers by a nonprofit entity) are inapplicable by their terms.

b. Cramdown Analysis

With the § 1129(a) requirements in § 1191(b) satisfied, the Court turns to the cramdown analysis as to the impaired classes that also rejected the Plan. As noted, even if a class of claims or interests is impaired and rejects a plan, the Court shall still confirm the Plan provided that it “does not discriminate unfairly, and is fair and equitable, with respect to each [such] class of claims or interests.”⁴¹

i. Unfair Discrimination Standard

“Unfair discrimination” under § 1191(b) is not defined in the Bankruptcy Code, but this requirement mirrors that in § 1129(b)(1). The Third Circuit Court of Appeals in the Tribune bankruptcy case recently refined the interpretation of unfair discrimination in the Chapter 11 context: “ ‘[D]iscriminate unfairly’ is a horizontal comparative assessment applied to similarly situated creditors ․ where a subset of those creditors is classified separately, does not accept the plan, and claims inequitable treatment under it.’ ”⁴²

ii. Fair and Equitable Requirements

For the “fair and equitable” analysis, Subchapter V does replace the rule of construction in § 1129(b)(2) with a new rule of construction, § 1191(c), which enumerates requirements that are “include[d]” in the condition that a plan is “fair and equitable,” such as a requirement for secured claims; the application of all of the projected disposable income during the plan period is applied to plan payments, or the value of the property to be distributed over the plan term is not less than such projected disposable income; and a finding that the debtor will be able to make the plan payments, or is reasonably likely to make all plan payments (with corresponding remedies for nonpayment).⁴³

iii. Non-Casey Classes 1 and 2

Class 1 is unimpaired, meaning that this Court need not analyze the unfair discrimination and fair and equitable tests as to it. Class 2 is impaired and deemed to reject, although no objections were filed as to Class 2. The Court has considered the Plan and the record to independently conclude that Class 2 does not discriminate unfairly and is fair and equitable. This leaves us with Classes 3, 4, and 5.

iv. Mr. Casey: Classes 3, 4, and 5

Mr. Casey wears a few proverbial “hats” in this case: a Class 3 creditor to the extent that his claims are allowed in the Casey/Day Litigation;⁴⁴ a Class 4 creditor to the extent his claims are subordinated or otherwise offset by virtue of the Casey/Day Litigation; and a Class 5 equity interest holder.

As noted, Mr. Casey's only remaining objection to confirmation of the Plan is that the Plan should impose a five-year, rather than a three-year, commitment period (with a related fact issue as to the projections), arguing that this is required to satisfy the fair and equitable standard. No objection on the basis of unfair discrimination was made, and, applying a horizontal assessment, the Court finds that there is no unfair discrimination. The Court will evaluate Mr. Casey's fair and equitable objection in the context of each of his pecuniary interests in this case.

aa. Class 3 Accepted the Plan.

The toggle structure of the Plan contemplates Mr. Casey as either a Class 3 or Class 4 creditor, depending upon the outcome of the Casey/Day Litigation. Therefore, to the extent Mr. Casey is a Class 3 creditor, he is part of a class that has accepted the Plan.⁴⁵ Because Class 3 has accepted the Plan, the cramdown analysis under § 1191(b) does not apply to it.⁴⁶ Instead, where, as here, there is a dissenting creditor (Casey) in an accepting class (Class 3), the dissenting creditor is only protected by the “best interests of creditors test,” and that test is satisfied.⁴⁷

bb. Class 4 Members Lack Standing to Object to Commitment Period.

As a Class 4 creditor, Mr. Casey lacks standing to raise a commitment period objection because the length of the commitment period does not affect a Class 4 member's direct interests. Section 1109(b) of the Bankruptcy Code provides that “[a] party in interest, including ․ a creditor, ․ may raise and may appear and be heard on any issue in a case under this chapter.”⁴⁸ “Although the definition of ‘party in interest’ is broad, it is not limitless. ‘[T]he case law on party-in-interest standing under § 1109(b) limits an objector to asserting its own rights—it may not assert the rights of others.’ ”⁴⁹ In the confirmation context, this has been construed to mean that one class of creditors lacks standing to assert the rights of another class under a plan or to otherwise challenge plan provisions that do not directly and negatively affect their pecuniary interests.⁵⁰

Wearing his hat as a Class 4 creditor, Mr. Casey lacks standing to object because his direct interest remains the same under either commitment period. Whether the commitment period is three or five years, Class 3 creditors would not be paid in full; in turn, under either commitment period, Class 4 members—paid, if at all, after Class 3 is paid in full—recover zero.

cc. Class 5 Treatment by Agreement and No Standing

Mr. Casey has agreed to the treatment of his equity interest in Class 5, i.e. valuation of his shares coupled with Debtor's share redemption, subject to the outcome of the Casey/Day Litigation.⁵¹ Further, even if his objection to the commitment period is asserted by him in his capacity as a Class 5 equity holder notwithstanding this, as is true as a Class 4 member, he would suffer no pecuniary harm from a three versus five-year commitment period; he therefore does not have standing as a Class 5 member on this issue.⁵²

B. THREE-YEAR COMMITMENT PERIOD IS FAIR AND EQUITABLE IN ANY EVENT

Even were this Court to assume, arguendo, that it would be appropriate to conduct a cramdown analysis as to Class 3 (or to assume that despite the lack of negative pecuniary impact, Mr. Casey still has standing as a Class 4 or 5 member to trigger a cramdown analysis), the record in this case supports a finding that the three-year commitment period is fair and equitable anyway.

This Court agrees with the Trinity court that it has “broad discretion” in deciding whether to require a debtor to commit all of its projected disposable income for a longer period than three years and that it should consider the “totality of the circumstances” of the case when exercising this broad discretion.⁵³

The Trinity court further concluded a debtor's choice of repayment period should be given deference only if there is no objection to the repayment period, but that where, as here, there are objections, the debtor has the burden of proof on the issue of whether the repayment period is fair and equitable.⁵⁴ This Court disagrees. The statute itself defaults to a three-year period unless the court—exercising discretion—fixes otherwise; the statute does not say that if faced with objection, the debtor then must demonstrate that three years is fair and equitable.

Importantly, when exercising its discretion, the Court must be mindful of separate findings under § 1191(c) that it must make to conclude that treatment is fair and equitable. Specifically, the Court must also find that the Debtor “will be able to make all payments under the plan” or that “there is a reasonable likelihood that the [D]ebtor will be able to make the payments,” in which case, the Court must further find that the Plan “provides appropriate remedies ․ in the event that the payments are not made.”⁵⁵

The record in this case makes the Court reticent to find that there is a reasonable likelihood that the Debtor will be able to make the payments beyond three years. To the contrary, the record reflects a real risk that once the existing contract periods (some of which expire in three years) and other developments by the government and/or Project Management Institute (“PMI”) occur, the Debtor's business could constrict, which in turn, suggests a reasonable likelihood that the Debtor cannot make plan payments to unsecureds beyond three years. Specifically, Mr. Tandon explained that one of their business lines—providing hosting services to the PMI chapters globally—“has been changing,” with PMI discouraging chapters from renewing contracts with Debtor (possibly to provide such services to its members for free itself), which makes it difficult to project out beyond the currently known, three-year contract terms and which could cause a shortfall of “about a half a million dollars.”⁵⁶ Mr. Tandon further explained that “[i]n [Debtor's] business, three years is like 30 in somebody else's” adding that in addition to the PMI uncertainty, their “federal government clients ․ have decided to shift away from a technology ․ that [Debtor] support[s],” the revenue from which Debtor knows “is going to go away,” albeit taking “a couple of years.”⁵⁷ Together, these uncertainties make a three-year period “less risky” and more supported by what is known currently.⁵⁸ Considering the record, the Court cannot make a finding that the Debtor has a reasonable likelihood to be able to make payments over a five-year (or longer than a three-year) period. Unable to make such a finding, the Court must decline to exercise discretion to diverge from (and decide to default to) a three-year commitment period.⁵⁹

This should end the inquiry. However, even were the Debtor to bear a burden to defend a three-year period, applying the Trinity factors—which are neither exhaustive nor dispositive—the record still supports a finding that the three-year commitment period is fair and equitable sufficient to satisfy that burden.⁶⁰

First, as highlighted by the Subchapter V Trustee at the Confirmation Hearing and as supported by the testimony and exhibits, the Plan stretches out payments to the secured creditor over ten years, which in turn, benefits the unsecured creditors by freeing up more projected disposable income; “[i]f [Debtor] had crammed the SBA into a three or five-year payment term, that would have significantly reduced what was available to unsecured creditors.”⁶¹ And all proceeds (if any) from the retained litigation would go to the unsecureds in addition to the projected disposable income.⁶²

Here, there are no capital reserves. But the Debtor is keeping $75,000 of cash in reserve during the three-year plan, while making payments to unsecured creditors of at least $241,310.⁶³ Mr. Casey contends that it is unclear whether the reserves are high enough for the maintenance of the Debtor's computers and other capital equipment.⁶⁴ The Debtor adduced testimony explaining the basis for, and reasonableness of, these projections. Mr. Tandon testified that the Debtor “[does not] have any capital equipment per se ․, other than laptops or things of that [sort], but what [the reserve] provides for is a reserve to not cash starve the business at least a month of salaries,” to protect from a “very real scenario” of a customer delaying payment.⁶⁵ This evidence supports the basis for and reasonableness of the Debtor's cash in reserve.

Salaries are reasonable—if not below market. Mr. Tandon testified that the salaries (including intended increases) are “very fair” and “low compared to market rate” and that previously intended pay increases had not been taken to ensure that the company does not impact cash flow, which is “everything for [Debtor].”⁶⁶

The cash flow projections are reasonable compared to historical performance coupled with developments in the marketplace, as explained by Mr. Tandon.⁶⁷

As highlighted above, there are substantiated risks that PMI business may disappear after existing three-year contracts, with other government/security business potentially lost over a finite time as well. These risks support a three-year plan period.⁶⁸

In short, the Trinity non-exhaustive factors and the totality of the circumstances in this record show that any Debtor-burden in defense of a three-year commitment period is satisfied.

Lastly, the record supports a finding that there is a “reasonable likelihood that the [D]ebtor will be able to make all payments under the[P]lan,” and that the Plan “provides appropriate remedies ․ to protect the holders of claims or interests in the event that the payment are not made.”⁶⁹ As discussed above, Mr. Tandon explained that there are three-year terms to existing PMI contracts as well as likely years delay to the risk of future loss to the government business, meaning that projections informed by historical performance would remain supportable at least for that shorter period.⁷⁰ And, the Plan spells out remedies in the event of nonpayment sufficient to satisfy § 1191(c).⁷¹

III. CONCLUSION

For the foregoing reasons and as supported by the record, the Court will enter a separate order confirming the Plan.

FOOTNOTES

1.   Doc. 108.

2.   See Plan at 1.

3.   See id.

4.   See id. at 2.

5.   Withdrawal of Objection of Anna Day to Debtor's First Amended Plan of Reorganization of Dark Rhiino Security, Inc., Doc. 159.

6.   See Docs. 80, 113 &145.

7.   The transcript of the Confirmation Hearing (“Feb. Tr.”) is located at Doc. 154. See Feb. Tr. at 11:2.

8.   See Declaration of Robert T. Smith in Support of First Day Motions (Doc. 6) ¶ 8.

9.   Id. at ¶ 8.

10.   See Plan (Doc. 108), at section A, ¶ 3.

11.   Feb. Tr. at 5:5–9.

12.   Capitalized terms not otherwise defined in this opinion shall have the meaning so ascribed in the Plan.

13.   See Plan, Article 4, 4.01, Classes 3 and 4.

14.   Plan, Article 4, 4.01, Class 5. The additional classes in the Plan, Classes 1 and 2, are not the subject to objection and therefore not summarized here. The Court addresses these classes below when undertaking the Court's independent duty to evaluate the Plan for compliance with the Bankruptcy Code.

15.   See Docs. 80, 113, 145.

16.   Specifically, as to #2 (the reserves issue), Mr. Casey's counsel confirms that paying funds into the Subchapter V Trustee and having him hold those reserve funds until Mr. Casey's unsecured claim is allowed or disallowed through the litigation resolves that issue. March Tr. (Doc. 156) at 28:5–9, 22–24. As to #3 (the retained defenses issues), the Debtor's counsel confirmed that the Debtor had no intent to strip Mr. Casey of his defenses in connection with the retained litigation. March Tr. at 29–30:25–16. As to #4, counsel for both parties confirmed that they have an agreement that the valuation of the shareholder shares would be done by judicial determination or by further agreement; with this agreement, Mr. Casey further agreed that § 1123(a)(4) is satisfied for purposes of plan confirmation. March Tr. at 16–17:14–4; 24:17–22 (Mr. Casey's counsel stating, “if the provision providing that the valuation is pursuant to an appraiser they select comes out and is replaced by the judicial or agreement of the parties, we would say that 1123(a)(4) is satisfied for purposes of plan confirmation.”). At the April 2, 2026 status hearing, the Court invited the parties to submit a stipulation as to these agreed points to streamline the record. As of the date of this Memorandum Opinion, such stipulation has not been filed but is incorporated into the record if and when filed.As to #4, Mr. Casey also raised in his second-filed objection a concern regarding the two remaining shareholders drawing “significant salaries” while using Debtor assets to fund litigation. See Doc. 113. Even if true, a debtor is permitted to retain and pursue its litigation causes of action (as are preserved in this Plan); additionally, so long as the projected disposable income is allocated (as the Plan here does) and provided that the salaries are market-appropriate (as the record supports), the Debtor may operate in the ordinary course of business, including but not limited to, making equity distributions or employee payments. 11 U.S.C. § 363(C)(1). See Plan (Doc 108). This basis to object to confirmation is unsupported by the law or the record and is overruled.

17.   This excludes § 1123(a)(8) and 1123(c), which are inapplicable in a Subchapter V case pursuant to § 1181(a).

18.   As incorporated by reference into § 1191(b), the requirements of § 1129(a), other than paragraphs (8), (10) and (15), are also met.

19.   As incorporated by reference into § 1191(b), the requirements of § 1129(a), other than paragraphs (8), (10) and (15), must be met.

20.   Feb. Tr. at 84:20–25.

21.   This subsection deals with real property that is the principal residence of the debtor, which is inapplicable here and therefore not quoted in toto.

22.   11 U.S.C. § 1190.

23.   See Plan (Doc. 108); see also March Tr. at 28:5-9, 22-24.

24.   See generally Plan. The Subchapter V-specific provision, Bankruptcy Code § 1190, is entitled “Contents of plan”, which is the identical heading ascribed to § 1123. Section 1190 does not reference § 1123 at all; it is silent as to whether its required contents are in addition to, or in lieu of, the contents required under § 1123. (By contrast, § 1191, entitled “Confirmation of plan,” does cross reference and incorporate some, but not all, provisions of § 1129(a), which has the identical heading, making it clear what does, and does not apply from the non-Subchapter V, identically titled provision.) Because § 1190 says a plan “shall include” the history, liquidation analysis, and projections and provide for the submission of future earnings or other future income without more, one could argue that these content requirements are an exhaustive list, in place of those set forth in § 1123. On the other hand, § 1181 states that §§ 1123(a)(8) and 1123(c) do not apply in a Subchapter V case, suggesting that the remaining provisions in § 1123 do. Because the Court finds all provisions of § 1123 (excluding §§ 1123(a)(8) and (c)) are satisfied in this case, the Court need not resolve this ambiguity today.

25.   11 U.S.C. § 1123(a)(4).

26.   March Tr. at 16:21-25, 23:5-13, 24: 17-22.

27.   In re Quigley Co., 377 B.R. 110, 116–19 (Bankr. S.D.N.Y. 2007).

28.   See Plan, Article 4, 4.01 (emphasis added). The Ninth Circuit Court of Appeals explains the important distinction between treatment of an interest versus an independent plan impact on the holder of that interest. In re Acequia Inc., 787 F.2d 1352, 1362-63 (9th Cir. 1986). There, § 1123(a)(4) was satisfied because the value of the interests was the same, even though one shareholder lost voting participation rights. The Acequia court focused on the difference between a shareholder's position as a director and officer and its position as equity security-holder. Id. Similarly, Mr. Casey's potential liability resulting from the Casey/Day Litigation (if any) would be separate from his position as an equity security-holder retaining the value of his shares. The treatment in Class 5 is the same—all shareholders retain the value of their interests. That his net recovery after his equally valued interests could be later reduced by offset due to liability (if any) resulting from the Casey/Day Litigation does not cause the Plan treatment with equally valued equity interests to be unequal. This Court need not form an opinion as to whether, absent Mr. Casey's agreement to share redemption with an agreed valuation process, a plan that requires redemption of some, but not all shares, provides the “same” treatment for each interest to satisfy § 1123(a)(4).

29.   11 U.S.C. § 1191(b).

30.   11 U.S.C. § 1123. This excludes § 1123(a)(8) and 1123(c), which are inapplicable in a Subchapter V case pursuant to § 1181(a).

31.   Feb. Tr. at 86:11-13

32.   Id. at 78:25-79:1.

33.   See Plan Ex. A; see also Certification of Acceptances and Rejections of Proposed Plan of Reorganization (Doc. 81); Feb. Tr. at 30:9-15.

34.   11 U.S.C. § 1129(a)(9).

35.   See In re EAS Graceland, LLC, No. 20-24484, 2021 WL 10395821, at *6 (Bankr. W.D. Tenn. July 20, 2021) (“Here, no objection to designation of a claim or interest was asserted by any party-in-interest under 11 U.S.C. § 1129(a)(9)․ The Court therefore concludes that Debtor has demonstrated by a preponderance of the evidence that the Plan complies with § 1129(a)(9).”).

36.   11 U.S.C. § 1129(a)(11).

37.   Feb. Tr. at 21:8–19.

38.   Id. at 21:24-22:6–7.

39.   Plan at 6.

40.   Section 1129(a)(15) is also an inapplicable provision in a Subchapter V pursuant to § 1181(a).

41.   11 U.S.C. § 1191(b).

42.   In re Tribune Co., 972 F.3d 228, 232 (3d Cir. 2020); see also In re Murray Metallurgical Coal Holdings, LLC, 623 B.R. 444, 520 (Bankr. S.D. Ohio 2021) (“Unfair discrimination is rough justice. It exemplifies the Code's tendency to replace stringent requirements with more flexible tests that increase the likelihood that a plan can be negotiated and confirmed.’ ”) (quoting Tribune, 972 F.3d at 245).

43.   See 11 U.S.C. § 1191(c). Notably, § 1129(b)—and its differently enumerated requirements included to make a plan fair and equitable—expressly does not apply in Subchapter V cases. See 11 U.S.C. § 1181(a).

44.   The Plan defines Class 3 as a class with “[h]olders of all allowed claims that are not entitled to priority and not included in Class 2 or 4,” adding that there could be distributions under Class 3 to Mr. Casey (and Ms. Day) “depending on the outcome of the Casey/Day Litigation.” Plan at 8. Class 4 also qualifies treatment of its members, if any, upon the outcome of the Casey/Day Litigation. See id. In other words, the Plan tells Mr. Casey (and Ms. Day) that they are either in Class 3 or Class 4, depending upon the outcome of yet-to-be filed Casey/Day Litigation.

45.   Mr. Casey did not submit a ballot as a Class 3 member. See Mr. Casey's ballot attached to the Stipulation Regarding Plan Ballot (Doc. 149). Had Mr. Casey also submitted a ballot as a Class 3 member, it appears that, given the $270,865.86 combined total of his Proofs of Claim, Class 3 would have rejected the Plan, which in turn, would have triggered the § 1191(b) cramdown analysis as to Class 3 (versus as to Classes 4 or 5). See Certification of Acceptances and Rejections of Proposed Plan of Reorganization (Doc. 81) at 1; see also Claims Register, Claim Nos. 2-1, 3-1, and 4-1. However, as discussed below, even had Mr. Casey so voted, the record supports a finding that Class 3 satisfies the cramdown requirements in any event.

46.   See In re Robinson, 632 B.R. 208, 220 (Bankr. D. Kan. 2021) (“[A]ll impaired classes have accepted the plan, thereby avoiding confirmation as a nonconsensual plan under § 1191(b).”).

47.   In re Aegerion Pharms., Inc., 605 B.R. 22, 32–33 (Bankr. S.D.N.Y. 2019) (cleaned up). See also id. at 29 (“[T]hose requirements [that the plan does not discriminate unfairly and be fair and equitable] only apply to creditors in a rejecting class. Dissenting creditors in an accepting class are only protected by section 1129(a)(7)—the best interests test—which requires that dissenting creditors receive at least as much as they would in a Chapter 7 liquidation.”). This § 1129(b) analysis applies with equal force to § 1191(b), given that it has the same “with respect to each class of claims or interests that is impaired under, and has not accepted, the plan” language that is found in § 1129(b).

48.   11 U.S.C. § 1109(b).

49.   In re The Roman Catholic Church of the Archdiocese of New Orleans, No. 20-10846, 2026 WL 688166, at *11 (Bankr. E.D. La. Mar. 10, 2026) (quoting In re AIO US, Inc., 672 B.R. 261, 274 (Bankr. D. Del. 2025)).

50.   See In re Genesis Glob. Holdco, LLC, 660 B.R. 439, 498 n.58 (Bankr. S.D.N.Y. 2024). In support of this restriction on standing, the Genesis court cited and summarized numerous cases as follows:EFL Ltd. v. Miramar Res., Inc. (In re Tascosa Petrol. Corp.), 196 B.R. 856, 863 (Bankr. D. Kan. 1996) (stating that prudential standing limitations prevented a Class 5 creditor from challenging portions of a reorganization plan that did not affect its direct interests and from asserting the rights of a Class 4 under the plan); In re Evans Prods. Co., 65 B.R. 870, 874 (S.D. Fla. 1986) (debtors “have standing only to challenge those parts of a reorganization plan that affects their direct interests” and lack standing “to raise the rights of wrongly classified creditors as a means to attack the overall reorganization plan” that had been proposed by a lender); In re Simplot, 2007 WL 2479664, at *10 (Bankr. D. Idaho Aug. 28, 2007) (stating that “parties may not assert confirmation objections that relate solely to others, or that go to issues that do not directly and adversely affect them pecuniarily” and limiting standing of entity in which debtor owned stock to specific plan confirmation issues, while rejecting standing to raise others); In re Orlando Inv., L.P., 103 B.R. 593, 596–97 (Bankr. E.D. Pa. 1989) (objectors could not challenge plan releases that only affected other interest holders, stating that “it is difficult to see how the rights of the objectors have been adversely affected by the inequality of treatment proposed by th[e] plan, and difficult to accord them standing to raise this issue.”); In re Johns-Manville Corp., 68 B.R. 618, 623 (Bankr. S.D.N.Y. 1986) (“[N]o party may successfully prevent the confirmation of a plan by raising the rights of third parties who do not object to confirmation.”), aff'd, 78 B.R. 407 (S.D.N.Y. 1987), aff'd sub nom. Kane v. Johns–Manville Corp. (In re Johns–Manville Corp.), 843 F.2d 636, 644 (2d Cir. 1988).Id. See also In re Cypresswood Land Partners, I, 409 B.R. 396, 418 (Bankr. S.D. Tex. 2009) (holding that “[c]ourts across the nation have determined that parties-in-interest may only object to plan provisions that ‘directly implicate its own rights and interests.’ ” (quoting In re Quigley Co., 391 B.R. 695, 705 (Bankr. S.D.N.Y. 2008)) (discussing supporting case law).

51.   See supra, footnote 16. Of note, the Ballot for Accepting or Rejecting Plan of Reorganization utilized in this case did not include Class 5 among the creditors or equity interests entitled to vote. See Doc. 54, Ex. A. Arguably, absent agreement, Class 5 is impaired, and interest holders should have been entitled to vote. Given the parties’ agreement as to Class 5 treatment and the absence of objection on this basis, this is harmless error.

52.   If anything, it appears that Mr. Casey would suffer a worse pecuniary impact as an equity holder with a five versus three-year commitment period because cash flow that would otherwise be unrestricted after year three would instead become restricted due to its allocation to creditors for a longer period, which in turn, negatively affects the value of the Debtor's equity, at least under a discounted cash flow analysis.

53.   In re Trinity Family Practice & Urgent Care PLLC, 661 B.R. 793, 821 (Bankr. W.D. Tex. 2024).

54.   Id. at 821–22.

55.   11 U.S.C. § 1191(c)(3).

56.   Feb. Tr. at 23:17–18; 24:24.

57.   Id. at 78:4–20.

58.   Id. at 79.

59.   Although not part of the record and not the basis for the Court's ruling, it is interesting to note that the three-year statutory default and the record here are also aligned with the statistics highlighted in the House Report for Congress to pass the Small Business Reorganization Act of 2019 (with its goal of making it easier for small businesses to reorganize): “According to the Small Business Administration Office of Advocacy, approximately 20 percent of small businesses survive the first year, but by the five-year mark only 50 percent are still in business and by the ten-year mark only one-third survive.” H.R. Rep. No. 116-171 (2019), reprinted in 2019 U.S.C.C.A.N 366, 367; see also In re Urgent Care Physicians, Ltd., No. 21-24000-BEH, 2021 WL 6090985, at *10 (Bankr. E.D. Wis. Dec. 20, 2021) (“Congress's recognition that small businesses typically have shorter life-spans than large businesses suggests that a plan term of three years is more reasonable, generally speaking (or as a default), than a five-year term, absent unusual circumstances.”)

60.   The Trinity factors are as follows:i. Capital reserves or capital expenditures during the period of plan payments;ii. Reasonableness of income and expenses set forth in the plan projections during the period of plan payments as compared to historical operations and operations during the post-petition, pre-confirmation time period;iii. Salary and/or other payments to insiders during the period of plan payments;iv. Risks and consequences of a longer period of plan payments; andv. Any other unique or extraordinary facts specific to the case.Trinity, 661 B.R. at 822–23 (cleaned up).

61.   Feb. Tr. at 90:21–24;

62.   Id. at 14:10-16.

63.   See Plan at 7; Exhibit B (Projected Disposable Income).

64.   See First Casey Obj. (Doc. 80) at 3.

65.   Feb. Tr. at 29:4–24. In Trinity, the complaint regarding the reserves was the opposite, i.e. that the reserve at $31,816.05 was too high when the distribution to unsecured creditors over the three-year term of the plan was only $38,816.05. There, the Court found insufficient evidence to support the reserves. Trinity, 661 B.R. at 823.

66.   Feb. Tr. at 22:20–24.

67.   See Feb. Tr. at 78:25–79:1. Mr. Casey does not appear to raise an issue with the Debtor's projections of operating expenses, but only its projections of revenue. See First Casey Obj. at 3.

68.   See Trinity, 661 B.R. at 825-826 (“The bankruptcy court should also consider any other facts that suggest that a longer period of plan payments increases the risk of the business failing.”)

69.   11 U.S.C. § 1191(c)(3)(B).

70.   Feb. Tr. at 23:17–18; 24:24; 78:4–20.

71.   See Plan, Article 9, ¶¶ 1-4.