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Trustee Charles Forman Makes Major Distribution to Asbestos Claimants

On May 1, 2023, the United States Bankruptcy Court for the District of Delaware issued an order approving an interim pro‐rata distribution in the amount of $15 million to unsecured creditors by Charles M. Forman, the Chapter 7 Trustee for National Service Industries, Inc.

During the bankruptcy case, approximately 20,000 asbestos claims were asserted against NSI. After a claim review process developed by the Trustee and approved by the court, approximately 4,000 of these claims were approved.

We successfully liquidated thousands of asbestos-related insurance claims in a single Chapter 7 proceeding, a rare achievement. –Charles M. Forman, Forman Holt

As of the petition date, NSI was subject to thousands of personal injury or wrongful death claims arising from the distribution of asbestos‐containing insulation by a previously-divested business of NSI dating back to the 1960s. NSI is the policyholder of numerous insurance policies that have covered and should continue to cover losses related to the asbestos claims.

Special insurance counsel to the Trustee, Gilbert LLP, negotiated numerous settlements with various insurance groups during the administration of the case, resulting in aggregate insurance recoveries in excess of $23 million.

The Trustee and his counsel will continue to pursue resolution of remaining, unresolved insurance assets and anticipates making a second distribution upon the close of the bankruptcy case which, hopefully, will occur next year.