Signal National - Chapter 11 Case Summary

Business Description

Headquartered at 3500 Maple Avenue, Suite 420, Dallas, Texas 75219, Signal National LLC ("Signal National"), together with its affiliated debtors and debtors in possession, including parent holding companies 777 Partners LLC ("777 Partners") and 600 Partners LLC ("600 Partners") (collectively, the "Debtors" or the "Company"), comprises an enterprise that historically operated, through 777 Partners and 600 Partners, as a diversified investment holding business.

• 777 Partners and 600 Partners, the two parent holding companies, held businesses and investments across structured finance and private credit, insurance and reinsurance, financial technology, litigation finance, aviation, professional sports, media and entertainment, and sustainability.
• Those businesses were conducted through numerous operating subsidiaries, special-purpose entities, and portfolio holding companies.

Brickell Insurance Holdings LLC ("Brickell"), a non-Debtor affiliate, historically served as the principal holding company platform for the Company's insurance and reinsurance investments, operating as a related but separate holding company.

• Brickell's historical insurance-related investments included Sutton National Group, Merit Life Insurance Company, and 777 Re, a Bermuda reinsurer.
• Although 777 Partners, 600 Partners, and Brickell were distinct holding company platforms, the broader enterprise was managed by Steven Pasko ("Pasko") and Joshua Wander ("Wander").

A number of the Debtors' businesses remain going concerns. Among other things, certain of these businesses own special-purpose vehicles that hold structured-receivables assets that self-liquidate over time. According to the Debtors, fully monetizing those assets for creditors will take years and will require the involvement of people who understand how these esoteric portfolios are structured, serviced, and realized.

The Debtors historically maintained principal offices in Miami, Florida at various locations. For the past two years, however, the majority of the workforce became predominantly remote, and the Company's day-to-day operations and major business decisions have been directed from the Dallas offices of GlassRatner Advisory & Capital Group LLC ("GlassRatner"), which serves as the Debtors' notice address in these cases.

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Corporate History

777 Partners was formed as a Delaware limited liability company in 2015 by Wander and Pasko. Its original business was underwriting and financing the purchase of structured-settlement portfolios and other non-traditional receivables, including medical-lien receivables, structured-settlement payment streams, and annuity-backed receivables.

• Beginning around 2018, and accelerating from 2021, 777 Partners expanded well beyond that base into consumer and commercial finance, insurance distribution, aviation and airlines, media and entertainment, and ownership interests in professional sports clubs and leagues across the United States, Europe, South America, Australia, and the Caribbean.
• Pasko formed 600 Partners as a Delaware limited liability company in 2017 as an affiliated investment holding company. Its portfolio overlapped with a number of 777 Partners' business lines, including structured settlements, aviation, media and entertainment, and professional sports.

The Debtors are part of a corporate structure comprising hundreds of direct and indirect subsidiaries, special-purpose entities, and holding companies organized under the laws of numerous U.S. and foreign jurisdictions. At its peak in 2023, the 777 Partners and 600 Partners enterprise had invested more than $10 billion in assets and was a major employer worldwide through its network of holding and portfolio companies. Per the Declaration, the original unabridged May 2024 organizational chart, prepared when GlassRatner was first engaged, spanned more than 500 legal entities across 60 pages.

Ownership

• 777 Partners is owned by Wander and Pasko through JARM Capital LLC and MTCP LLC, which hold interests in SuttonPark Acquisition LLC, the direct parent of 777 Partners.
• 600 Partners is owned by Pasko through MTCP LLC and SPA II LLC.

Two-Wave Filing Structure

Chapter 11 has long been part of the Debtors' wind-down plan, and the Company had been preparing to file for several months. Because the Involuntary Petition accelerated the timing, the Company is filing in two waves.

• The Debtors commencing these Chapter 11 Cases in the first wave (the "First-Wave Debtors") are the parent holding companies and the affiliated entities whose assets, operations, or role in the DIP and wind-down structure require that they be in chapter 11 now. The First-Wave Debtors comprise 777 Partners, 600 Partners, and their direct and indirect subsidiaries listed on Exhibit A to the Declaration—23 entities in total.
• Several additional affiliates (the "Subsequent Debtors") require more time to prepare their filings and are expected to file their own chapter 11 petitions within approximately 60 days.

The First-Wave Debtors are grouped as follows:

• Administrative and DIP-borrower entities. Signal National was formed as a Texas limited liability company in February 2026 to consolidate certain administrative functions for the Debtors, including payroll and employee benefits, and to facilitate the final stage of the restructuring from Texas, where GlassRatner and the Debtors' restructuring professionals have been directing much of the day-to-day restructuring work. 777 Asset Management LLC likewise supports the enterprise's asset-management functions. These entities are filing to preserve the centralized administrative and cash-management operations on which the wind-down depends.
• Parent holding companies. 777 Partners and 600 Partners are the primary obligors or guarantors under the principal prepetition facilities and the borrowers under the DIP Credit Facility, and their estates are the focal point of the litigation and claims to be administered in these cases.
• Structured-finance and receivables entities. SuttonPark Capital LLC and SuttonPark Servicing LLC (structured-settlement purchasing and servicing), Singer Asset Finance Company, L.L.C., the Signal receivables entities (Signal Servicing LLC, Signal National LLC, Signal AHF Medical Receivables HoldCo LLC, Signal MLH Medical Receivables HoldCo LLC, and Signal LF Portfolio Holdco LLC), and related holding and funding entities hold or service the self-liquidating receivables that constitute most of the Debtors' remaining going-concern value. They are filing to protect that value and to enable an orderly, centralized monetization under a chapter 11 plan. The Declaration also groups Sphinx Funding LLC among these entities and refers to it as a Debtor, though Sphinx Funding does not appear on Exhibit A's list of the 23 First-Wave Debtors; per Exhibit B, the Sphinx Funding litigation-funding business remains subject to ongoing litigation management.
• Consumer/commercial finance and litigation-finance entities. F3EA Holdings LLC, F3EA Capital LLC, F3EA Servicing LLC, Employee Funding of America, LLC, Tactical Marketing Partners LLC, and Lex Capital Holdings LLC hold residual assets, contracts, or claims from the consumer-finance and litigation-finance verticals that are best administered within these estates.
• Other holding and asset entities. Daedalus I LLC, Ironman Capital LLC, Lumiere Acquisitions Company LLC, Lumiere Financing LLC, Phoenicia LLC, Thresher Acquisition LLC, and certain other holding entities are filing because they hold residual equity, contract rights, or claims, or because their inclusion is necessary to administer intercompany obligations and preserve the integrity of the cash-management and DIP structure.

Management Transition

• The Declaration is submitted by Mark Shapiro, the Debtors' independent Chief Operating Officer and authorized signatory and a Senior Managing Director of GlassRatner since 2016. Shapiro has over thirty years of experience as a turnaround advisor and corporate financial executive, previously served as chief financial officer of public companies including Big Lots Inc. and Central Parking Corp., is a Certified Public Accountant (inactive), and states that he has been directly involved in over 30 sales and other dispositions of assets or business units of the Debtors and their affiliates.
• In May 2024, the Company retained GlassRatner to provide independent financial and operational leadership. Ian Ratner and Ronald Glass were appointed independent managers, and Mark Shapiro was appointed COO to run day-to-day operations. Shapiro replaced Mr. Glass as a manager upon his resignation on September 18, 2024.
• Michael Thatcher of GlassRatner became Chief Financial Officer of 777 Partners and 600 Partners effective December 19, 2025.
• In preparation for these chapter 11 cases, GlassRatner determined it was in the best interests of the Debtors to seek new independent managers during the pendency of the cases. Ian Ratner and Shapiro accordingly resigned as managers of 777 Partners and 600 Partners, and on August 6, 2026, Anna Phillips was appointed independent manager for both entities.
• Since May 2024, neither Wander nor Pasko has had any role in managing the Company.

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Operations Overview

The Company's operations were historically organized into several verticals, which the Debtors describe generally as follows:

• Private credit / structured finance — acquisition, financing, servicing, and monetization of structured settlement payment streams, medical receivables, lottery receivables, and other specialty-finance assets.
• Insurance / reinsurance — insurance distribution, insurance-company investments, reinsurance, and related asset-management activities.
• Financial technology — consumer and specialty finance, servicing, and technology-enabled lending businesses.
• Litigation finance — funding and management of litigation-related receivables and claims.
• Aviation — airline technology, airline investments, aircraft leasing, and related aviation assets.
• Sports — ownership and financing of interests in professional football and basketball clubs, leagues, and sports-related businesses.
• Media and entertainment — film-completion guarantees, production and post-production services, media-rights and related entertainment investments.
• Sustainability — investments in businesses focused on sustainable products and related commercial opportunities.

Private Credit / Structured Finance

• The structured-finance and private-credit businesses were among the Company's earliest and most significant operations, covering the acquisition, financing, servicing, and monetization of structured settlement payment streams, medical receivables, lottery receivables, and other specialty-finance assets.
• These businesses generally used special-purpose entities to originate, purchase, finance, and service structured settlement payment streams, lottery receivables, medical and healthcare provider receivables, and insurance commission receivables.
  • The portfolios were financed through asset-backed lending facilities and securitization vehicles, with borrowing bases tied to the value of eligible receivables.
  • The assets self-liquidate as the underlying payment streams are collected over a period of years. This vertical comprises a significant amount of the Debtors' remaining going-concern value.

Other Historical Verticals

• Through Debtor F3EA Holdings LLC and its subsidiaries, including Debtors F3EA Capital LLC, F3EA Servicing LLC, Employee Funding of America, LLC, and Tactical Marketing Partners LLC, the Company originated and serviced consumer and commercial finance receivables, including consumer installment loans and related lending products marketed through a network of merchant and lead-generation channels.
• Through Debtor Lex Capital Holdings LLC and Scout Law Group Holdings LLC, the Company held interests in the litigation-finance and legal-services vertical, which originated and acquired litigation-related receivables and funded claims through platforms operated under the JusticeFunds business. The Declaration refers to Scout Law Group Holdings LLC as a Debtor, though it does not appear on Exhibit A's list of the 23 First-Wave Debtors; per Exhibit B, the Scout Law plaintiff's-law business was sold to management in February 2026 for assumption of debt and nominal cash consideration.
• Through Debtors Phoenicia LLC and Daedalus I LLC, the Company held its aviation investments, comprising both aviation-technology platforms and airline investments, including a minority interest in Flair Airlines in Canada and the start-up Australian carrier Bonza. Per Exhibit B to the Declaration, Bonza entered voluntary administration and liquidation proceedings in Australia, and the Company's Flair position was disposed of in July 2025 through an Article 9 public disposition of a convertible promissory note issued by Flair Airlines LTD and the repurchase of Flair's preferred shares by Flair.
• Through Debtors Lumiere Financing LLC and Lumiere Acquisitions Company LLC, the Company held its interest in the Film Finances business, a film completion-guarantee and production-services enterprise. Per Exhibit B, Film Finances Inc. filed a chapter 11 case in Delaware in January 2025 and its assets were sold in a section 363 sale, with no cash proceeds to the estate.
• Through Debtor Thresher Acquisition LLC, the Company held interests in entities related to an insurance-distribution and technology platform that marketed and administered life and annuity insurance products.
• Exhibit B to the Declaration reflects the disposition or wind-down of the remaining verticals, including the sale of 777 Equipment Finance to a third party for $3.8 million of cash proceeds; the sale of Merit Life, a provider of fixed annuity products, to a third party generating approximately $25.0 million of cash applied to the reduction of senior debt; the restructuring of Sutton National's ownership into a trust; the termination of the Company's license for the British Basketball League and that league's shutdown, together with UK administration proceedings for the London Lions; and the Article 9 dispositions of England Holdings 3, Inc., the holding company for the STX movie and television studio, in satisfaction of $6.5 million of debt in May 2025 and, together with equity interests in Chiller Island and Flair and related promissory notes, $21.5 million of debt in July 2025.

Remaining Assets

After two years of dispositions and foreclosures, the Company's remaining value is concentrated in its self-liquidating structured-receivables portfolios and related servicing operations, together with residual equity interests, contract rights, litigation claims (including the Leadenhall commercial reasonableness and bond claims), and avoidance and other estate causes of action.

• These structured-receivables assets remain going concerns and will generate value as the underlying payment streams are collected over a period of years.
• According to the Debtors, realizing that value requires continuity of knowledgeable management and servicing, which the Debtors propose to preserve through these cases and a liquidating trust (the "Liquidating Trust").

Workforce

As of the Petition Date, the Debtors employ approximately 15 employees, consisting of 14 full-time employees and one part-time employee, along with three independent contractors. Twelve employees are salaried and three are hourly, and all employees work remotely.

• Employees are employed on a full-time or part-time basis by 777 Partners LLC, SuttonPark Capital LLC, or SuttonPark Servicing LLC (the body of the Declaration states more narrowly that the employees are employed by 777 Partners), and payroll is processed through Signal National, with payroll processing functions managed by ADP. Full-time employees are paid current bi-weekly, while part-time employees and the independent contractors are paid bi-weekly in arrears, with all payroll funded and paid at the same time.
• The employees fill the functional roles of in-house legal, accounting, treasury, finance, human resources, and portfolio servicing on behalf of all Debtors and are, per the Debtors, critical to ongoing operations and the preservation of estate value.
• As a result of the two-year wind-down and the sale of most of the Company's operating assets, the current workforce is far smaller than at its historical peak. It is concentrated in finance, legal, and functions supporting the continued servicing and management of the remaining receivables, regulatory and financial reporting, the wind-down of remaining assets, and the prosecution and defense of litigation.

Employee Benefits

• Employees receive 15 days of PTO per year and may carry over a maximum of five days to the next fiscal year.
• Health, vision, and dental insurance is provided through Cigna, EyeMed Vision Care, and MetLife, with premiums paid monthly by the Debtors and cost-shared with employees. The total approximate annual amount paid by the Debtors for health insurance in 2026 is approximately $215,000.
• The Debtors provide voluntary and basic life insurance, accidental death and dismemberment, an employee assistance program, voluntary critical illness, voluntary accident, and disability insurance through MetLife at an approximate annual cost of $17,000.
• Workers' compensation insurance is maintained through Zurich at statutorily required levels in each state in which the Debtors operate; the total cost of the current program for the current policy period is $3,560, paid monthly.
• Miscellaneous employee programs, consisting of health savings accounts and flexible savings accounts, carry an approximate annual cost of $42,000.

Cash Management and Insurance

• The Debtors' cash management system comprises 10 bank accounts held at Axos Bank, City National Bank of Florida, Customers Bank, and East West Bank. As of the Petition Date, the Debtors hold approximately $10.3 million of total cash in these accounts, of which approximately $9.1 million is held for the benefit of non-Debtor third parties or is subject to reconciliation, leaving approximately $1.2 million available for operations and expenses. The accounts include a settlement-proceeds account holding funds for the benefit of a non-Debtor third party, suspense and passthrough accounts holding unidentified or third-party collections pending reconciliation and disbursement to the appropriate Debtor or non-Debtor parties, and a SuttonPark Servicing operating account funded in part through protective advances made by National Founders under a loan facility with a non-Debtor affiliate. Signal National's two East West Bank accounts serve as the primary general operating and payroll accounts for all Debtors and receive DIP credit facility deposits, with the SuttonPark Debtors reimbursing those accounts for expenses incurred on their behalf. The 777 Partners account at Customers Bank, a former operating account for payroll and accounts payable, has activity currently suspended due to garnishment.
  • Bank fees are paid monthly in arrears and vary but approximate $4,500 per month.
  • The Debtors provide corporate credit card access through Ramp Visa to approximately four senior-level employees, with a total limit of $30,000.
• The Debtors maintain approximately four insurance policies, including one expired director and officer liability policy that has remaining policy limits during the policy period, plus additional expired excess policies amending that policy. The policies provide coverage for, among other things, commercial general liability, employee benefits liability, and director and officer liability, and carry an aggregate annual premium of approximately $103,800.
  • The policies are generally one year in length, typically renew in November, and are paid annually in advance.

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Prepetition Obligations

As of the Petition Date, the Debtors report at least $2,705,233,601.28 in prepetition funded-debt obligations. The Debtors caution that the summary covers only major debt obligations, excludes the obligations of non-Debtor affiliates and certain guaranties, and reflects estimates still subject to reconciliation that should not be construed as an admission of any amount owed. The Debtors further note that the ACAP facilities and the Dacian obligations described below are among a number of obligations owed by the Debtors or their affiliates to ACAP and Dacian affiliates, with a complete breakdown set forth on Schedule 1.3 to the DIP Credit Agreement. The principal facilities are as follows:

Senior Secured DIP Credit Facility

• Pursuant to a Superpriority Debtor-in-Possession Credit Agreement dated as of June 9, 2026, entered into by the Debtors and certain non-Debtors, ACM Delegate LLC ("ACM"), as administrative agent, and AAV2024 LLC ("AAV2024"), Advantage Capital Holdings LLC ("ACH"), Dacian Master Fund LP ("Dacian"), Haymarket Insurance Company ("Haymarket"), and National Founders LP ("National Founders"), as lenders (collectively, the "DIP Lenders"), agreed to provide a new credit facility (the "DIP Credit Facility") comprising prepetition new-money advances of up to $8,632,000 to fund working capital and the preparation of these cases, plus additional postpetition funding of up to $6,238,000 for the costs of administering the cases.
  • As of the Petition Date, prepetition advances under the DIP Credit Facility total $8,632,000.
  • Borrowings are secured by substantially all of the Debtors' assets, including senior first-priority liens on assets not subject to valid, perfected, and non-avoidable liens (including proceedings or property recovered in connection with chapter 5 causes of action), and junior liens on all assets subject only to valid, properly perfected, and non-avoidable liens existing as of the Petition Date.
  • The DIP Lenders are also receiving Priming Liens, but each DIP Lender's Priming Liens attach only to collateral in which such lender already held first-priority liens in its capacity as a prepetition lender.

ACAP Holdco Facility

• Certain Debtors are borrowers or guarantors under an Amended and Restated Loan and Security Agreement dated as of November 2, 2023 among 600 Partners, 777 Partners, and JARM Capital LLC, as borrowers, together with other corporate guarantors, ACM, as administrative and collateral agent, and AAV2024 and Haymarket, as lenders (the "ACAP Holdco Facility"). The facility amended and restated, without novation, an existing Loan and Security Agreement dated as of February 27, 2020 between 777 Partners, as borrower, and Haymarket, as lender, in an original principal amount of $46 million.
  • The ACAP Holdco Lenders made available a secured loan facility in a maximum principal amount of up to $891,235,612.59, the proceeds of which were used for working capital for the borrowers, corporate guarantors, and their various portfolio investments, and for the acquisition of portfolio investments.
  • Borrowings are secured by substantially all assets of 600 Partners, 777 Partners, and the guarantors thereto.
  • The facility matured on November 2, 2024 and is in default. As of June 30, 2026, principal and interest owed—inclusive of the 777-600 Bridge Loan, TAMI Tranche, JARM Obligations, and MCAG Tranche, each as set forth on Schedule 1.3 to the DIP Credit Agreement—totals approximately $1,259,454,011.76.

ACAP Unsecured Facility

• On or about December 12, 2024, 777 Partners, as borrower, and ACH, as lender, entered into an Unsecured Loan Agreement providing an unsecured facility in a maximum principal amount of up to $25 million to fund operational costs and professional fees.
  • As of June 30, 2026, the principal balance owed is $25,037,805.82, with the excess over $25 million resulting from PIK interest accruing and being added to outstanding principal.

Leadenhall Master Facility

• 777 Partners and 600 Partners are unsecured guarantors under a Loan and Security Agreement dated as of May 7, 2021 among both Debtor and non-Debtor subsidiaries, as borrowers, the lenders, Leadenhall Capital Partners LLP, as administrative agent, and Leadenhall Life Insurance Linked Investments Fund PLC, as collateral agent (collectively, "Leadenhall").
  • The Debtors note that the facility is an obligation of special-purpose borrower entities and that 777 Partners and 600 Partners are unsecured guarantors only, not secured borrowers, with Leadenhall holding no lien on their assets—a point the Second Circuit confirmed.
  • The non-Debtor subsidiary borrowers under the facility are SPLCSS III LLC, Signal SML 4 LLC, Insurety Agency Services LLC, and Dorchester Receivables II LLC. Leadenhall exercised rights under the facility to appoint independent managers for each of the borrowers, for Insurety Agency Services in December 2024 and for the remaining borrowers in December 2025.
  • The facility is structured through separate borrower and lender groups and provided committed financing subject to borrowing base limitations and specified sub-facility limits, which originally totaled $300 million but were increased to $350 million. Loans were funded based upon the value of eligible receivables comprising the applicable borrowing base and were secured by senior liens on substantially all of the borrowers' assets, including structured settlement receivables, lottery receivables, medical-related receivables, health-care provider loan receivables, and insurance commission receivables.
  • Leadenhall alleges that the same collateral securing the facility—reportedly more than 1,600 assets valued at approximately $185 million—was also pledged to other lenders, and that certain Debtors and their principals made material misrepresentations regarding the ownership and priority status of that collateral. Leadenhall asserts a claim of approximately $609 million, including default interest, fees, and other charges. The Debtors dispute the validity and amount of Leadenhall's claims.
  • Per the Debtors, Leadenhall's aggressive posture in litigation and collateral disputes has driven a disproportionate share of the cost, delay, and disruption in the Company's wind-down.

National Founders (Knightsbridge) Facilities

• Certain of the Company's structured-finance special-purpose vehicles are borrowers under facilities provided by National Founders, secured by the receivables held in those vehicles. SuttonPark Capital LLC is a guarantor on certain of those facilities, and both 777 Partners and 600 Partners act as guarantors as well.
  • As of June 30, 2026, the principal amount owed under the National Founders facilities is $1,187,113,090.59.
  • SuttonPark Capital LLC has pledged all of its right, title, and interest in one of the non-Debtor affiliates to secure the obligations under those facilities.

Other Material Secured Debt

• Vida Margin Loan. 777 Partners is a borrower under an Amended and Restated Margin Loan Agreement dated as of July 14, 2020 with the Vida lenders in an original principal amount of approximately $59.7 million, secured by a pledge of collateral by non-Debtor affiliate Brickell PC Insurance Holdings LLC and guaranteed by SuttonPark Capital LLC and Signal Financial Holdings LLC.
  • Following an alleged default, Vida obtained a $26 million judgment against 777 Partners, SuttonPark Capital LLC, Signal Financial Holdings LLC, and Brickell PC Insurance Holdings LLC in the Supreme Court of the State of New York, County of New York. That judgment is the stated basis for the Involuntary Petition.
• ING Capital Facility. Sierra 2016, LLC ("Sierra 2016"), a special-purpose entity, is a borrower under a credit agreement dated June 17, 2016 with ING Capital LLC ("ING Capital"), as sole lender and administrative agent, secured by a first-priority lien on substantially all of Sierra 2016's assets. ING Capital asserts that Sierra 2016 owes more than $28 million and has brought an action seeking to recover those loan proceeds on a fraud theory. The Debtors dispute ING Capital's claims.
• 777 Revolver. 777 Partners is a borrower under a Second Amended and Restated Revolving Loan and Security Agreement dated as of February 17, 2022 with Dacian, one of the DIP Lenders, as sole lender, secured by, among other things, a brokerage account owned by 777 Partners (the "Dacian Revolver Facility"). The Debtors' capital structure summary reflects $14,000,000 outstanding. The Dacian Revolver Facility is among several other obligations owed by the Debtors or their affiliates to Dacian.
• Additional facilities reflected in the Debtors' capital structure summary include the EFOA Loan ($76,379,331), the SPS Secured Rated Loan ($56,654,579.70), the Thresher Seller Note ($19,342,782.41), and the 777 Condo Loan ($4,620,000).

Workforce Obligations

• As of the Petition Date, the Debtors estimate total outstanding workforce obligations of approximately $97,106.15, which the Debtors' schedule identifies as accrued but unpaid PTO for active employees. The Debtors state that no amounts will be due and owing on account of accrued and unpaid PTO as of the Petition Date, and they seek authority to allow employees to roll that $97,106.15 of PTO over and use it postpetition in the ordinary course; the Debtors expressly do not seek authority to pay cash in satisfaction of any PTO accrued before the Petition Date. The Debtors estimate no amounts are owed on account of accrued but unpaid wages to employees or independent contractors, ADP payroll processing fees, deductions, health insurance, other benefits, workers' compensation, or miscellaneous employee programs, though they seek authority to pay any prepetition amounts owed to the independent contractors and to continue honoring those obligations in the ordinary course.
• The Debtors also expect to owe approximately $4,500 in bank fees and approximately $17,000 on the corporate credit card as of the Petition Date, and do not believe any prepetition amounts are due on account of insurance premiums.

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Events Leading to Bankruptcy

Macroeconomic Pressure and Collateral Irregularities

The Debtors attribute their financial distress to the convergence of several developments over a period of years. Beginning in 2022, sharply rising interest rates increased the cost of financing and affected the valuation and economics of a number of rate-sensitive assets and financing structures across the Company, while the Company's aviation and professional sports investments were operating through the extended effects of the COVID-19 pandemic, which had materially disrupted both industries. These pressures increased the liquidity required to support certain portfolio companies and reduced the availability and attractiveness of external financing.

• Separately, issues emerged by 2022 concerning the ownership, eligibility, valuation, and allocation of receivables supporting certain specialty-finance facilities, including instances in which assets were reported as collateral under more than one facility or were not available to the borrower in the manner reflected in lender reporting.
• The Company's later forensic work has shown that these issues predated the 2024 management transition. Their existence created disputes among 777-related entities and their lenders and materially complicated the Company's financing position.

Reinsurance Disruption and Loss of Capital Access

During late 2023 and early 2024, regulatory and ratings developments affecting 777 Re created additional liquidity and business pressure. The Bermuda Monetary Authority took regulatory action with respect to 777 Re, and certain reinsurance counterparties subsequently recaptured or began recapturing business and related assets, reducing 777 Re's asset base and financial flexibility and affecting businesses that had historically depended on capital or liquidity associated with the reinsurance platform. Per Exhibit B to the Declaration, 777 Re's Bermuda license was ultimately revoked and the company is in wind-down.

• By late 2023, the combination of tightening credit, the reinsurance disruption, mounting creditor concerns, continued mismanagement, and significant adverse publicity surrounding Wander and the proposed Everton acquisition caused the Company's access to outside capital to contract sharply, and investors and creditors lost confidence in Wander.
• Leadenhall commenced litigation, and the Company could no longer fund its expansion or, before long, its ordinary operations without lender forbearance and continued funding.

Management Transition and Out-of-Court Wind-Down

By the spring of 2024, those issues had developed into a broader liquidity, governance, and creditor-management problem. Wander and Pasko voluntarily resigned and were replaced by independent restructuring management in May 2024, with GlassRatner professionals taking charge of day-to-day operations.

• Since that time, the Debtors have pursued sales, negotiated transitions, foreign insolvency processes, and consensual surrenders, and have monitored and where appropriate addressed the exercise of secured-creditor remedies across the Company's portfolio, all while maintaining the personnel and infrastructure necessary to preserve and administer remaining assets. A summary of these dispositions and creditor actions is attached to the Declaration as Exhibit B.
• The largest transactions reflected in Exhibit B include the consensual sale of the equity of Trans Atlantic Lifetime Mortgages Limited ("TAMI"), a UK equity-release mortgage business, to an ACAP affiliate in satisfaction of up to $275 million of debt, subject to valuation and future performance; the Article 9 public disposition of the equity of Nutmeg Acquisition LLC, which held international football club interests, in satisfaction of $157 million of debt; the sale of Uown, a consumer rent-to-own business, to an ACAP affiliate in satisfaction of $61.0 million of debt plus $1.0 million of cash proceeds; the sale of the GO7 / Flexflight aviation-technology business to a third party for assumption of approximately $45.0 million of liabilities plus $1.0 million of cash; the sale of the MLH medical-lien receivables business generating $32.0 million of cash applied to the reduction of senior debt; the sale of Triplet Global, the owner of a private aircraft, generating $23.5 million applied to the reduction of senior debt; the Article 9 strict foreclosure by an ACAP affiliate on the equity of 777 Stream LLC in full satisfaction of $23.2 million of debt; and the consensual redemption of 777 Partners' equity interest in Advantage Capital Holdings in satisfaction of $12.7 million of debt.
  • Exhibit B reports outcomes in differing forms—cash proceeds, satisfaction or reduction of debt, and assumption of liabilities—and includes governance actions, wind-downs, and lender-controlled foreclosures for which the Debtors report no consideration to the estates.
• Of the dispositions reflected in Exhibit B, a number were negotiated sales the Debtors actively directed that generated cash proceeds or a reduction of the Debtors' secured or guaranty obligations; others were consensual, non-cash resolutions that extinguished guaranty or other contingent exposure without generating cash proceeds; and still others—including certain dispositions of collateral securing the ACAP Holdco Facility—were conducted by the Debtors' senior secured lenders as collateral agent, exercising their own remedies with respect to already-pledged collateral, where the Debtors' ability to actively direct or negotiate terms was limited.
• Throughout this period, the Debtors' ability to monetize assets was constrained by the nature of the funding available to them and, with respect to certain assets, by the preliminary injunction Leadenhall obtained restraining the guarantors' assets, since vacated.
  • The Debtors' senior secured lenders made protective advances at GlassRatner's request to fund the wind-down on a basis sufficient to preserve going-concern operations and avoid an uncontrolled collapse, but that funding was not structured, and was not intended, to provide working capital for reinvestment in the underlying businesses.
  • As a result, in a number of instances, assets that could have commanded a materially higher price if marketed and sold on a fully-funded, non-distress basis were instead disposed of on a distressed timeline dictated by the availability of funding, the pendency of litigation, and, in certain instances, the constraints imposed by and the continued negative publicity resulting from the Leadenhall complaint and preliminary injunction.
• Certain of the Debtors' largest secured creditors supported that process with additional liquidity, including AAV2024, ACH, Dacian, Haymarket, and National Founders, all of whom are participating in the bridge and proposed debtor-in-possession financing for these cases. Their continued funding allowed the Debtors to avoid a disorderly and value-destructive shutdown while restructuring professionals worked through a portfolio of assets that included long-duration receivables, foreign investments, litigation claims, and other assets that cannot be responsibly liquidated on a single timetable.

Regulatory, Criminal, and Civil Litigation

The Debtors are the subject of a number of pending civil and regulatory matters that have substantially impacted their operations, reputation, and access to capital. The Debtors note that the following highlights major ongoing matters and is not intended as a complete list of the litigation to which the Debtors are parties; all litigation matters will be set forth in each Debtor's forthcoming Statement of Financial Affairs.

• SEC Enforcement Action. On October 16, 2025, the SEC filed a complaint against Wander, Pasko, 777 Partners, 600 Partners, and Damien Alfalla, the Company's former chief financial officer, alleging that the defendants misled investors about the Company's financial condition and fraudulently induced investments in the $237 million preferred-equity offering by falsely representing that the Company had, and would continue to have, net income sufficient to pay a 10% annual dividend. The complaint further alleges that Wander and Alfalla misused a credit facility, resulting in a $300 million overdraw.
  • Alfalla resolved the SEC's claims by consent judgment entered December 16, 2025, and Pasko did so by consent judgment entered April 1, 2026. Wander's motion to dismiss remains pending, and civil discovery was stayed in full on May 11, 2026 pending the criminal case.
• Criminal Prosecution of Wander. On October 16, 2025, the U.S. Attorney's Office for the Southern District of New York unsealed an indictment charging Wander with conspiracy to commit wire fraud, wire fraud, conspiracy to commit securities fraud, and securities fraud, arising from a scheme to defraud the Company's lenders and investors of more than $500 million, principally through the double-pledging of collateral and the digital alteration of bank statements. Alfalla pleaded guilty to an information on October 14, 2025, two days before the indictment was unsealed.
  • On June 30, 2026, prosecutors filed a superseding indictment adding allegations that Wander diverted the majority of a $20 million loan into his personal brokerage account and directed employees to fabricate bank statements to conceal the diversion, together with a witness-tampering count alleging that Wander attempted to discourage a former Company analyst from testifying. Wander is contesting the charges, and trial is set for October 19, 2026.
• Leadenhall Litigation. On May 3, 2024, Leadenhall filed a complaint against Wander, Pasko, 777 Partners, 600 Partners, and certain Debtor and non-Debtor affiliates, among others, in the U.S. District Court for the Southern District of New York (the "SDNY Court"), asserting federal RICO claims together with fraudulent-inducement and contract claims, and alleging that Wander and the Debtors defrauded Leadenhall by double-pledging certain collateral securing its SPE-level facilities. The Debtor-related defendants' motion to dismiss the amended complaint was fully briefed as of December 19, 2024 and remains pending.
  • On March 23, 2026, the U.S. Court of Appeals for the Second Circuit vacated the preliminary injunction that had restrained the guarantors' assets, holding that the SDNY Court lacked authority to enjoin 777 Partners' and 600 Partners' assets because Leadenhall asserted no valid lien on, or equitable interest in, those assets. 777 Partners and 600 Partners intend to pursue the injunction bond to recover damages caused by the vacated injunction.
• Leadenhall Article 9 Foreclosures. In May 2025, Leadenhall conducted Article 9 foreclosure auctions of the assets of three non-Debtor borrower entities—Signal SML 4 LLC, SPLCSS III LLC, and Dorchester Receivables II LLC—consisting of structured-settlement and receivables portfolios whose value depends on specialized knowledge of the underlying payment streams. Leadenhall acquired portfolios it had itself valued at more than $170 million for nominal credit bids of $1 each.
  • The Company contends these sales were not conducted in a commercially reasonable manner, stripped hundreds of millions of dollars of value from the estates at a fire-sale price, and were engineered to inflate Leadenhall's guaranty claims against 777 Partners and 600 Partners. On February 5, 2026, the Company filed a verified amended complaint seeking, among other things, a declaration that the plaintiffs bear no deficiency liability because Leadenhall failed to conduct the sales in a commercially reasonable manner.
  • Following the auctions, Leadenhall asserted that certain of the foreclosed receivables had been transferred to DASIR 2 LLC and directed third-party obligors to remit collections to DASIR 2. The Company contends that, despite repeated requests, Leadenhall and DASIR 2 failed to provide the sale closing documents, written assignments, or other documentation sufficient to establish DASIR 2's ownership of the receivables or authority to redirect those collections.
• ING Capital Litigation. ING Capital initially sued 777 Partners, 600 Partners, Wander, Pasko, and others in the SDNY Court in October 2024, alleging that the Debtors defrauded ING Capital by pledging more than $28 million in assets that the borrower did not own. That action was voluntarily dismissed for lack of subject-matter jurisdiction, and on January 27, 2025 ING Capital refiled a substantially similar complaint in the Circuit Court for Miami-Dade County, Florida.
  • On May 20, 2026, the United States moved to intervene and stay that action pending the Wander criminal trial, and the court granted the stay on June 1, 2026. ING Capital moved for reconsideration on June 2, 2026 on the basis that the order was entered before the opposition deadline; following an August 6, 2026 hearing, the Florida state court reconsidered its ruling and is allowing expert discovery to proceed. No trial date has been set.

The Involuntary Petition and Chapter 11 Filing

The Debtors had been planning for an eventual, coordinated chapter 11 process on a measured timeline. However, on July 16, 2026, Vida Longevity Fund LP, Vida Insurance Credit Opportunity Fund II, L.P., and Vida Insurance Credit Opportunity Fund III, LP (collectively, "Vida") filed an involuntary chapter 7 petition (the "Involuntary Petition") against 777 Partners in the U.S. Bankruptcy Court for the Southern District of Florida, Case No. 26-19312-PDR, premised on Vida's $26 million judgment under the Vida Margin Loan. The Company sought to engage Vida toward a consensual resolution consistent with the orderly wind-down, but Vida declined to cooperate.

• Absent the Involuntary Petition, the Debtors would have continued their consensual wind-down without a chapter 11 filing at the Debtor level and, on a modestly longer timeline, commenced streamlined voluntary chapter 11 cases.
• The Debtors each filed voluntary chapter 11 petitions on August 9, 2026 in the U.S. Bankruptcy Court for the Northern District of Texas, Fort Worth Division, and will continue to operate their businesses and manage their assets as debtors in possession. 777 Partners' deadline to respond to the Involuntary Petition is August 11, 2026.
• Concurrently with these cases, the Debtors intend to ask the Florida bankruptcy court to convert the involuntary case to chapter 11 and transfer venue of that case to the Texas court. The Debtors do not intend to contest entry of an order for relief in the involuntary case.

Chapter 11 Strategy

The Debtors' stated objective in chapter 11 is to preserve remaining value, complete sales and other monetizations that should occur during the bankruptcy, establish an orderly process to resolve creditor claims and litigation, and transfer longer-duration assets and causes of action to a liquidating trust that can realize value over time.

• The DIP Credit Facility is being provided by the Company's senior secured prepetition lenders, who have made protective advances at GlassRatner's request to fund working capital and have agreed to continue funding through these cases. Per the Debtors, their support reflects both their economic stake in maximizing the value of the collateral and their confidence in the Debtors' management and wind-down strategy.
• The Debtors intend to market and sell certain remaining assets during these cases where a sale will realize value more efficiently than holding the asset, through a Court-supervised process designed to protect against the kind of value-destructive, below-market disposition experienced in the Leadenhall Article 9 auctions. Assets not sold during the cases will be transferred to the Liquidating Trust for monetization over time.
• The cases will also establish an orderly, centralized, Court-supervised process for creditors to file and, where necessary, adjudicate claims, and allow the Debtors to pause the surrounding litigation—a process the Debtors view as particularly important given that several of the largest asserted claims, including the Leadenhall guaranty claim and the ING Capital claim, are disputed and bound up with the fraud allegations and collateral disputes described above.
• The Debtors intend to propose a chapter 11 plan establishing the Liquidating Trust to hold and monetize the remaining self-liquidating receivables and other going-concern assets for the benefit of creditors following the plan's effective date, and to provide a stable, long-term vehicle for pursuing the estates' retained litigation and avoidance claims.
• The Debtors assert that a chapter 11 wind-down will realize materially more value for creditors than a chapter 7 liquidation, under which a trustee new to these businesses—lacking the years of institutional knowledge current management has developed and operating under a mandate to liquidate promptly—would face a substantial risk of a forced, premature fire sale, as the Leadenhall $1 credit bids for portfolios valued in the hundreds of millions of dollars illustrate.

First Day Motions

• Concurrently with their petitions, the Debtors filed First Day Motions seeking, among other things, DIP financing; maintenance of the cash management system and authority to pay related prepetition obligations, including bank fees and amounts owed on the corporate credit card; continuation of the Debtors' insurance program, entry into new policies, and payment of premiums; an extension of time to file schedules and statements; authority to file a consolidated creditor matrix; authority to pay prepetition wages, salaries, other compensation, and reimbursable expenses and to continue employee benefit programs; and retention of Epiq Corporate Restructuring, LLC as claims, noticing, and solicitation agent effective as of the Petition Date. The Debtors also request joint administration of these 23 chapter 11 cases, and anticipate thousands of persons and entities to be noticed, with case information available at https://dm.epiq11.com/SignalNational.
• Through the Creditor Matrix Motion, the Debtors seek authority to file a single consolidated creditor matrix for all Debtors and a single consolidated list of their 30 largest general unsecured creditors, to redact the home addresses and other personally identifiable information of individuals, including creditors, employees, and former employees, and to establish notice procedures and a master service list.
• Through the Schedules and Statements Extension Motion, the Debtors seek an additional 18 days to file their schedules and statements, for a total of 33 days from the Petition Date, through and including September 11, 2026.