/raid1/www/Hosts/bankrupt/TCR_Public/160930.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, September 30, 2016, Vol. 20, No. 273
Headlines
1018 PULASKI: Disclosures, Plan Approval Hearing on Nov. 15
3324 N. CLARK: Case Summary & 6 Unsecured Creditors
39 FRANKLIN: Selling Nutley Property to Perosi, Jr. for $375K
7 BAY CORP: Ditches Reorganization Plan; To Liquidate Instead
8E LAUNDRY: Seeks to Hire Allen Barnes as Legal Counsel
ABENGOA BIOENERGY: Wants Plan Filing Period Extended to Jan. 19
ABENGOA SA: U.S. Creditors Want to Launch Probe
ACTIVECARE INC: Signs Asset Purchase Pact with JMJ Financial
ALLEGIANT TRAVEL: Scraps Planned $300M Bond to Finance Aircraft
ALLIANCE ONE: Continues to Monitor Crop Purchases
ALLIANCE ONE: Moody's Hikes Corporate Family Rating to Caa1
ALLIANCE ONE: Offering $275M Senior Secured Notes Due 2021
ALLIANCE ONE: Plans to Enter Into Revolving Credit Facility
ALLIANCE ONE: S&P Raises CCR to 'CCC+' on Refinancing
ALLIED CONSOLIDATED: Wants Jan. 31 Solicitation Period Extension
ALPHA DINER: Unsecureds To Recover 3% Under Plan
AMERICAN APPAREL: General Counsel Grayson Said to Assume CEO Post
ANTERO RESOURCES: S&P Retains 'BB' Sr. Unsecured Rating
ARMADA WATER: Court Moves Plan Filing Deadline to December 19
ATNA RESOURCES: ARI Unsecureds to Recoup 8% Under Liquidation Plan
AUTHENTIDATE HOLDING: Files Transition Report on Form 10-KT
AUTHENTIDATE HOLDING: Incurs $45,200 Net Loss in Third Quarter
AZURE MIDSTREAM: Adopts Incentive and Retention Bonus Program
BARBARA GORANSSON: Unsecureds To Get $25,000 Under Plan
BARBARA MAGNUSSON: Trustee Selling Spring Lake Property for $2.6M
BATE LAND & TIMBER: Bid to Dismiss BLC Appeal Granted
BAY CIRCLE: Seeks Plan Exclusivity Extension Until November 4
BEAZER HOMES: S&P Retains 'B-' Rating on Senior Unsecured Notes
BENNU TITAN: Hearing on Bid for Ch.11 Trustee Moved to Nov. 1
BIG GUYS PIZZERIA: Taps James Joyce as Legal Counsel
BIOCLINICA HOLDING: S&P Assigns 'B-' CCR; Outlook Stable
BLUE WAVE TECH: Court Affirms $8K Fee Awarded to Caribbean Tower
BONANZA CREEK: At Risk of Credit Squeeze After Overdrawing Revolver
BRIDGET BRASFIELD: Disclosures Ok'd, Plan Hearing on Nov. 15
CABLE & WIRELESS: Moody's Lowers CFR to Ba3; Outlook Stable
CAESARS ENTERTAINMENT: Hilton Hit with $4.7M ERISA Suit
CAESARS ENTERTAINMENT: Provides Report on Revised Plan Term Sheet
CAESARS ENTERTAINMENT: To Emerge From Ch. 11 Bankruptcy
CARIBBEAN TRANSPORT: Taps Rivera & Fernandez as Special Counsel
CBS RADIO: Moody's Assigns B1 Corporate Family Rating
CBS RADIO: S&P Assigns 'B+' CCR & Rates $250MM Facility 'BB-'
CCH JOHN EAGAN: Court Moves Solicitation Period Thru October 19
CHEMTURA CORP: S&P Puts 'BB-' CCR on CreditWatch Positive
CLAIRE'S STORES: Pays in Full Delayed Notes Interest
CLAIRE'S STORES: Said to Tap FTI Consulting
CLARK-CUTLER-MCDERMOTT: Pro Rata Share for Unsecureds Under Plan
CLIPPER ACQUISITIONS: Moody's Withdraws Ba1 Corp Family Rating
COMPASS MINERALS: Moody's Cuts Corporate Family Rating to Ba2
CORDERO CORDERO: Taps Richard Schell-Asad as Attorney
COSI INC: Case Summary & 20 Largest Unsecured Creditors
COSI INC: Files Chapter 11, Has Deal to Sell Biz for $6.8 Million
COSI INC: Files for Bankruptcy, Cites Drop in Sales
COSI INC: Files for Chapter 11 Bankruptcy to Facilitate Sale
DAILY HAVEN: Seeks to Employ Ordinary Course Professionals
DAL PARTNERS: Case Summary & 4 Unsecured Creditors
DAWSON INTERNATIONAL: Needs Until January 2017 to File Plan
DCP MIDSTREAM: S&P Affirms 'BB' CCR & Revises Outlook to Stable
DELIVERY AGENT: Selling Clean Fun Business to HALO
DIANE ROSE MAESTRI: Disclosures OK'd; Plan Hearing on Nov. 1
DIOCESE OF STOCKTON: Chapter 11 Exit Plan Has $17.1-Mil. Funding
DRUMMOND CO: S&P Affirms 'BB' CCR & Revises Outlook to Stable
DUCK NECK: Unsecureds To Be Paid From Sale Proceeds
EAST COAST FOODS: Judge Ousts President
ECI HOLDCO: S&P Lowers Rating to 'B', Outlook Stable
ECI HOLDINGS: Court to Consider Plan Outline on Nov. 2
EMERALD EXPOSITIONS: Moody's Affirms B2 Corporate Family Rating
EMERALD EXPOSITIONS: S&P Affirms B+ CCR & Revises Outlook to Pos.
ENERGY FUTURE: Wants to Settle Forest Creek's $32M Unsec. Claim
ESP RESOURCES: Asks Court to Extend Plan Filing Period to Dec. 5
EVEREST HOLDINGS: Moody's Cuts Corporate Family Rating to B3
FANSTEEL INC: Seeks to Hire Bradshaw Fowler as Legal Counsel
FRANCIS MARICONDA: Gets Court Approval of Ch. 11 Exit Plan
FRANK KERR: Novi Nine Mile Offers $9.83M for Novi Property
FREEPORT-MCMORAN INC: S&P Lowers CCR to 'BB-'; Outlook Stable
FTE NETWORKS: Appoints Lynn Martin as Chief Operating Officer
GAWKER MEDIA: Committee Seeks Court OK to Conduct Discovery
GAWKER MEDIA: Creditors Seek Access to Books, Depose Founder
GEI HOLDINGS: Sale of Three New Jersey Properties Approved
GERALD DEVER: To Pay Unsecureds in 60 Months Under Plan
GOLDEN MARINA: Wants Plan Filing Period Extended to Dec. 6
GOLFSMITH INTERNATIONAL: UST Wants Consumer Privacy Ombudsman
HAWTHORNE FAMILY FARMS: Hearing on Bankruptcy Plan Set for Nov. 2
HERCULES OFFSHORE: Judge Wants Parties to Resume Negotiations
HESTER CONSTRUCTION: Oct. 12 Plan, Disclosures Hearing
HEYL & PATTERSON: Committee May File Own Plan, Court Says
HIDALGO COUNTY: S&P Lowers Rating on $26.7MM Bonds to 'CCC'
HME HOLDINGS: Case Summary & 20 Largest Unsecured Creditors
HOSTESS BRANDS: Court Dismisses Suit vs. Bread Depo
HOUSTON AMERICAN: Remains Noncompliant with NYSE's Listing Rules
HRG GROUP: S&P Affirms 'B' CCR; Outlook Remains Stable
HTY INC: Voluntary Chapter 11 Case Summary
ICE THEATERS: Gets Court Approval of Liquidating Plan
IHEARTCOMMUNICATIONS INC: Soliciting Consents to Amend Indenture
INMAN STREET: Court to Convene Oct. 20 Hearing on Chapter 11 Plan
INNOVATIVE OBJECTS: Seeks to Hire Berman DeLeve as Legal Counsel
ION WORLDWIDE: Unsecured Creditors to Get 13%-17% Under Plan
IRF PROPERTIES: Case Summary & 2 Unsecured Creditors
ISLANDWIDE LOGISTICS: Case Summary & 20 Top Unsecured Creditors
ITT EDUCATIONAL: Makes First Appearance in Bankruptcy Court
JALAL NEISHABOURI: Enters into Lease of Bozeman Property
JAMES HUMPHREYS: Bid to Stay "Horne" Suit Pending Appeal Denied
JAMES SCOTT SMITH: Hearing on Plan Disclosures Set For Oct. 27
JC PENNEY: Moody's Hikes Corporate Family Rating to B1
JOHN RITTER: Sale of Clark County Parcels to D.R. Horton Approved
JOSUE CARRERO: Ch. 11 Case Converted to Ch. 7
KEITH GUERZON: Unsecureds To Recover 13% Under Plan
KEMET CORP: Files Copy of Investor Presentation with SEC
KENDALL LAKE TOWERS: Becker & Poliakoff Opposes Plan Outline
KENNETH ARTHURS: Unsecureds Get at Least 33% Dividend Under Plan
KHANH VAN TONG: Unsecured Creditors to Get Nothing Under Plan
KIDS ONLY II: Plan Confirmation Hearing on Oct. 4
KM VILLAS: Seeks to Hire Ice Legal as Counsel in Suit v. HSBC
LAREDO WO: WRR Offers $49.1M for Substantially All Assets
LAST CALL GUARANTOR: McCarron, Sullivan Represent M&D Clients
LEGACY RESERVES: S&P Lowers CCR to 'CCC' Over Liquidity
LEHMAN BROTHERS: To Pay Another $3.8-Bil. to Creditors
LEN-TRAN INC: Court Extended Plan Filing Deadline to Oct. 10
LEONEL DIAZ HERNANDEZ: Unsecureds To Recoup 3% Under Plan
LIFSCHULTZ ESTATE: Taps DelBello Donnellan as Legal Counsel
LIGHTSTREAM RESOURCES: Moody's Lowers PDR to D-PD on CCAA Filing
LINN ENERGY: Creditors Agree to Extend Plan Filing to Oct. 7
LINN ENERGY: Hearing on Bid to Hire Moelis Adjourned Sine Die
LRI HOLDINGS: Court OKs Plan Outline; Nov. 9 Conf. Hearing Set
LUCAS ENERGY: Supplements Current Report on APA Closing
LUVU BRANDS: Incurs $312,000 Net Loss in Fiscal 2016
M SPACE: Wants More Time to File Plan as Lender Talks Continue
MACELLERIA RESTAURANT: Selling NYC Restaurant Assets for $1.1M
MARSHA ANN RALLS: Hearing on Plan Disclosures Set For Oct. 19
MATTRESS FIRM: S&P Withdraws 'B+' Corporate Credit Rating
MAX EXPRESS: Seeks Oct. 31 Extension of Plan Filing Period
MCDONALD BUILDING: Taps Gallagher & Kennedy as Legal Counsel
MCKEESPORT AREA SD: Moody's Affirms Ba1 GO Rating, Outlook Neg.
MICHAEL D. COHEN: Seeks to Hire Cole Schotz as Legal Counsel
MICHAEL ROBERT WIGLEY: 8th Circ. BAP Junks Lariat Co.'s Appeal
MIDSTATES PETROLEUM: Texas Judge to Confirm Chapter 11 Plan
MIMM CONDOMINIUM: Hires Carballo as Special Counsel
MMM HOLDINGS: S&P Affirms 'B-' Counterparty Credit Rating
MORGANS HOTEL: Stockholders Approve SBE Merger Agreement
MRP GENERATION: Moody's Affirms B1 Rating on Sr. Credit Facility
MRP GENERATION: S&P Gives Prelim. BB- Rating on New $270MM Loan
MUSCLEPHARM CORP: Adopts Second Amended Bylaws
NAKED BRAND: Receives Noncompliance Notice from Nasdaq
NAVIDEA BIOPHARMACEUTICALS: Appoints President and CEO
NEPHROGENEX INC: Selling All Assets at Nov. 14 Auction
NORANDA ALUMINUM: Court OKs Stalking Horse Deal with MFR II
OAK CREEK: Exit Plan Sets Aside $100K to Pay Unsecured Creditors
OAKFABCO INC: Court Sets Oct. 31 Exclusive Plan Filing Deadline
OCH-ZIFF CAPITAL: To Pay Over $400-Mil. in Bribery Settlement
ORACLE PROJECT: Disclosures OK'd; Plan Hearing on Nov. 1
PACIFIC ANDES: Voluntary Chapter 11 Case Summary
PAE HOLDING: Moody's Assigns B3 Corporate Family Rating
PAE HOLDING: S&P Assigns 'B' CCR & Rates $550MM Term Loan 'B'
PAMELA FROG: Case Summary & 11 Unsecured Creditors
PARKER DEVELOPMENT: Case Summary & Unsecured Creditor
PERSEON CORP: Asks for Plan Exclusivity Extension Through Nov. 21
PETROQUEST ENERGY: Closes Exchange Offers & Consent Solicitation
PJ ROSALY: Case Summary & 20 Largest Unsecured Creditors
PLANDAI BIOTECHNOLOGY: EMA Reports 9.9% Stake as of Sept. 19
PORTER BANCORP: Signs New Employment Agreements with Executives
PREMIUM CAPITAL: Case Summary & 20 Largest Unsecured Creditors
PRIME GLOBAL: Stockholders Elect Five Directors
PROFESSIONAL DIVERSITY: To Effect Reverse Common Stock Split
PSC INDUSTRIAL: Moody's Lowers CFR to B3; Outlook Stable
PUERTO RICO: Pension Fund Joins Suit vs. UBS Over Muni Bonds
QUANTUM CORP: Grants Board Observer Rights to Messrs. Mutch & Rau
QUANTUM CORP: VIEX Capital Reports 11% Stake as of Sept. 23
RADIAN GUARANTY: S&P Raises ICR to 'BB'; Outlook Stable
RENNOVA HEALTH: Files Copy of Investor Presentation With SEC
REYNOLDS GROUP: S&P Raises CCR to 'B+' on $500MM Incremental Loan
RICE ENERGY: Moody's Puts B2 CFR Under Review for Upgrade
RICE ENERGY: S&P Affirms 'B' CCR, On CreditWatch Positive
RICHARD HAISFIELD: Disclosure Statement Hearing on November 10
RICK KHOMAL BENISASIA: Plan to Pay Unsecured Creditors in Full
RICOCHET ENERGY: Needs Until October 6 to File Chapter 11 Plan
RONALD B. GREY: Court Junks Appeal From Chase Claim Order
RP BROADCASTING: Case Summary & 20 Largest Unsecured Creditors
S & H OF WEST: Disclosure Statement Hearing on Oct. 25
S-3 PUMP SERVICE: Unsecureds To Recoup 40%-50% Under Plan
S-3 PUMP: Selling Collateral to CFSC to Pay Claim
SALESFORCE.COM INC: Egan-Jones Hikes Sr. Unsecured Ratings to BB-
SAMSON RESOURCES: Court Denies Extension of Exclusive Periods
SANDRIDGE ENERGY: Expects to Emerge from Chapter 11 Next Week
SANDRIDGE ENERGY: Plans to Issue $300,000,000 in Notes Due 2020
SATURN CORP: Court Approves Amended Disclosure Statement
SCT TRANSPORTATION: Disclosure Statement Hearing Set for Nov. 8
SESAC HOLDCO II: S&P Revises Outlook to Neg. & Affirms 'B' CCR
SEVENTY SEVEN: Moody's Assigns Caa1 CFR, Outlook Stable
SH 130 CONCESSION: Wants Plan Filing Period Moved to Nov. 30
SIMMONS FOODS: S&P Raises CCR to 'B'; Outlook Stable
SOUTHERN SEASON: Selling Assets at NC Stores to Calvert for $30K
ST. JUDE NURSING: Taps Senior Living Investment as Broker
STELLAR BIOTECHNOLOGIES: Mark McPartland Quits as VP Corp. Dev't
STONEWALL GAS: Moody's Places B2 CFR Under Review for Upgrade
STONEWALL GAS: S&P Puts 'B' CCR on CreditWatch Positive
SUBMARINA INC: Franchisees Try To Block Court OK on Disclosures
SUN PROPERTY: Has Until November 16 to File Chapter 11 Plan
SUNEDISON INC: Sale of Interests in Minnesota Projects Approved
SUNRISE LOGISTIC: Taps Steven A. Schwaber as Legal Counsel
SWEET BRIAR: S&P Raises Rating on 2006 Refunding Bonds to 'B'
T C & PAM: Plan Outline Okayed, Confirmation Hearing on Nov. 3
T-REX OIL: Announces Spin-Off of Subsidiary NexFuels, Inc.
TAYLOR-WHARTON: Court Extends Solicitation Period Through Oct. 28
TIAT CORPORATION: Unsecureds May Be Paid From Stock Sale Proceeds
TIM'S TRUCKING: Plan Outline Ok'd, Confirmation Hearing on Oct. 24
TITHERINGTON DESIGN: Proposes CRG Auction of Assets on Nov. 15
TLC HEALTH: Still Focuses on Patients' Needs, 16th PCO Report Says
TOM GJURAJ: Files Second Amended Disclosure Statement
TOYS R US: Negotiates $88-Mil. Mezzanine Deal for Propco II
TRIANGLE USA: Gibson, Young Conaway Represent Ad Hoc Noteholders
TRINITY CONSTRUCTION: Disclosures Ok'd, Plan Hearing on Oct. 19
TROLLEY ROCK: Wants Plan Filing Period Extended to Nov. 15
TWEDDLE GROUP: Moody's Assigns B2 Corporate Family Rating
UFS HOLDINGS: S&P Affirms 'B' CCR, Outlook Stable
UNIVERSAL FIBER: Debt-Funded Dividend is Within Moody's B2 CFR
UNIVERSAL SECURITY: Gets Noncompliance Notice From NYSE Anew
VALAIRCO INC: Seeks to Hire Vernoia Enterline as Accountant
VERTELLUS SPECIALTIES: Settles with EPA, 3 States
VIZIENT INC: Moody's Retains B2 CFR on Proposed Facility Amendment
WAREHOUSE 11: Seeks to Hire McKinley Onua as Legal Counsel
WIND ENTERTAINMENT: To Sell New Equity Interests Under Plan
WINNERS SPORTS BAR: Unsecureds To Recover 10% Under Plan
WISCONSIN DAIRY GOAT: Disclosures Okayed, Plan Hearing on Oct. 24
ZOHAR CDO 2003: High Court Decline's Tilton's Bid to Block SEC Suit
[*] AlixPartners Appoints David Hindman to Turnaround Team
[*] S.D.N.Y. Asks for Comment on Proposed Bankruptcy Rule Changes
[^] BOOK REVIEW: Oil Business in Latin America: The Early Years
*********
1018 PULASKI: Disclosures, Plan Approval Hearing on Nov. 15
-----------------------------------------------------------
The Hon. David E. Rice of the U.S. Bankruptcy Court for the
District of Maryland has scheduled for Nov. 15, 2016, at 11:00 a.m.
the hearing to consider the approval of 1018 Pulaski Highway LLC's
disclosure statement and the confirmation of the plan of
reorganization.
As reported by the Troubled Company Reporter on Sept. 6, 2016, the
Debtor filed the Plan, which proposes to sell three real properties
owned by the company in Hartfod County, Maryland, to ARLS
Properties LLC for $1.68 million to fund payments to creditors.
Oct. 21, 2016, is the last day for filing objections to the
confirmation of the Plan. Oct. 21 is also the deadline for filing
written acceptances or rejections of the Plan.
1018 Pulaski Highway LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Md. Case No. 15-25352) on Nov. 4, 2015.
3324 N. CLARK: Case Summary & 6 Unsecured Creditors
---------------------------------------------------
Debtor: 3324 N. Clark Street, LLC
917 W. Washington, Suite 127
Chicago, IL 60607
Case No.: 16-30934
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Donald R Cassling
Debtor's Counsel: Ariel Weissberg, Esq.
WEISSBERG & ASSOCIATES, LTD
401 S. LaSalle Street, Suite 403
Chicago, IL 60605
Tel: (312) 663-0004
Fax: 312 663-1514
E-mail: ariel@weissberglaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Simone Singer Weissbluth, manager of WMW
Investments, LLC, the manager of Debtor.
A copy of the Debtor's list of six unsecured creditors is available
for free at http://bankrupt.com/misc/ilnb16-30934.pdf
39 FRANKLIN: Selling Nutley Property to Perosi, Jr. for $375K
-------------------------------------------------------------
39 Franklin Realty, LLC, asks the U.S. Bankruptcy Court for the
District of New Jersey to authorize the private sale of real
property commonly known as 39 Franklin Avenue, Nutley, New Jersey
("Property") to Anthony Perosi, Jr. or an LLC to be Established for
Mr. Perosi, Jr., for $375,000, subject to higher or better offers.
A hearing on the Motion is set for Oct. 27, 2016 at 11:00 a.m. The
objection deadline is
Oct. 20, 2016.
A copy of the Real Estate Sales Contract attached to the Motion is
available for free at:
http://bankrupt.com/misc/39_Franklin_86_Sales.pdf
Pursuant to the Contract, the closing will occur 10 days after
entry of the Court's Order approving the sale.
Banco Popular North America ("Bank"), the mortgagee on the
Property, will accept by way of settlement the proceeds of the sale
in the sum of $375,000 in full and complete satisfaction of the
Debtor's and the guarantor's obligations to the Bank. Those
proceeds would be turned over to the Bank at closing, subject to
the Court's approval.
The proceeds of the proposed sale of the Property will assist the
Debtor in facilitating its Plan of Liquidation.
As part of the sale of the Property, the tenant, Plaza Pastry,
which is owned by John Catelli, the principal of the Debtor, will
enter into a new 5 year lease with a 5 year renewal option (if the
tenant is performing) at the rental rate of $4,250 per month on a
triple-net lease with the tenant being responsible for taxes,
hazard insurance, flood and maintenance. Plaza Pastry must pay a
3-month security deposit and 1 month's rent at closing. The form of
lease must be acceptable to the Purchaser.
Both the Purchaser and Mr. Catelli certify to the Court that the
363 sale is an arms-length transaction and that any and all terms
of the 11 U.S.C. Sec. 363 sale and the tenant lease have been fully
disclosed.
Mr. Catelli, in his business judgment, has determined that it is in
the best interest of the Estate and the creditors of the estate to
sell the Property.
The Purchaser:
Anthony Perosi, Jr.
654 Richmond Rd.
Staten Island, NY 10304
The Purchaser is represented by:
Michael J. Gaffney, Esq.
1164 Victory Blvd.
Staten Island, NY 10301
Counsel for the Debtor:
Melinda D. Middlebrooks, Esq.
MIDDLEBROOKS SHAPIRO, P.C.
841 Mountain Avenue
Springfield, NJ 07081
Telephone: (973) 218-6877
About 39 Franklin Realty
39 Franklin Realty, LLC sought Chapter 11 protection (Bankr. D.N.J.
Case No. 15-16879) on
April 15, 2015. The Debtor estimated assets in the range of $0 to
$50,000 and $100,001 to $500,000 in debt. The Debtor tapped
Melinda D. Middlebrooks, Esq. at Middlebrooks Shapiro, P.C. as
counsel. The petition was signed by John Catelli, president.
7 BAY CORP: Ditches Reorganization Plan; To Liquidate Instead
-------------------------------------------------------------
7 Bay Corp. filed on Sept. 19, 2016, an amended disclosure
statement disclosing that instead of reorganizing, it is pursuing a
Plan of Liquidation.
As previously reported, the Debtor owns the remaining development
rights for nine units in a fully permitted waterfront condominium
parcel of real property located on 7 Bay Street in Hull,
Massachusetts.
The cohesive and comprehensive financing plan presented in the
Liquidating Plan that proposes a custom construction completion for
each unit, in an efficient manner that is set in place with an
orderly sale process and allows for a cost benefit and maximum
return to the entire creditor body and not simply the senior
secured claimant, is based upon the Debtor's ability intended goal
to pay 100% of the allowed secured and unsecured claims prior to
any distribution to the equity class, through the Debtor's
completion of the project.
To the extent there are excess funds available after the payment of
all the administrative, Priority and the Claims in Classes One thru
Seven, then the holders of claims in Class Eight (equity interests)
will be entitled to share, pro rata, in any funds available for
distribution.
As protection of the rights of the Creditor Body and the Estate,
the Amended Plan will provide for the appointment of an independent
fiduciary or court appointed professional that will,
without limitation to any and all rights under the Bankruptcy code
and Rules and Title 11, investigate any and all claims and causes
of action that the Debtor holds or has rights to recover in the
form of funds, avoidance of liens, to seek the return of any
preferential payment or otherwise augment the Estate of the Debtor
for the benefit of Creditors.
A redlined copy of the Debtor's Liquidation Plan is available at:
http://bankrupt.com/misc/mab15-14885-272-1.pdf
About 7 Bay Corp
7 Bay Corp, based in Hull, Massachusetts, filed a Chapter 11
petition (Bankr. D. Mass. Case No. 15-14885) on Dec. 17, 2015.
Judge Frank J. Bailey presides over the case. John M. McAuliffe,
Esq., at MCAULIFFE & ASSOCIATES, P.C., serves as the Debtor's
counsel. In its petition, 7 Bay estimated $1 million to $10
million in both assets and liabilities. The petition was signed by
Steven Buckley, president.
8E LAUNDRY: Seeks to Hire Allen Barnes as Legal Counsel
-------------------------------------------------------
8E Laundry, Inc. seeks approval from the U.S. Bankruptcy Court for
the District of Arizona to hire legal counsel.
The Debtor proposes to hire Allen Barnes & Jones, PLC to provide
legal services in connection with its Chapter 11 case.
The individuals designated to represent the Debtor and their hourly
rates are:
Thomas H. Allen Member $395
Hilary Barnes Member $395
Michael A. Jones Member $325
Philip J. Giles Associate $285
Khaled Tarazi Associate $225
The hourly rate of the firm's legal assistants and law clerks
ranges from $115 to $135.
Allen Barnes is "disinterested" as defined in section 101(14) of
the Bankruptcy Code and has no connection with creditors, according
to court filings.
The firm can be reached through:
Thomas H. Allen, Esq.
Philip J. Giles, Esq.
Allen Barnes & Jones, PLC
1850 N. Central Ave., #1150
Phoenix, Arizona 85004
Tel: (602) 256-6000
Fax: (602) 252-4712
Email: tallen@allenbarneslaw.com
Email: pgiles@allenbarneslaw.com
About 8E Laundry
8E Laundry, Inc. filed a chapter 11 petition (Bankr. D. Ariz. Case
No. 0:16-BK-10138-BMW) on September 1, 2016.
The Debtor owns and operates a laundromat located in Yuma, Arizona.
The Debtor leases the commercial property located at 3325 S.
Avenue 8E, Suite 106, Yuma, Arizona to operate its business.
ABENGOA BIOENERGY: Wants Plan Filing Period Extended to Jan. 19
---------------------------------------------------------------
Abengoa Bioenergy US Holding, LLC, et. al. ask the U.S. Bankruptcy
Court for the Eastern District of Missouri to extend their
exclusive periods to file a plan of reorganization and solicit
votes on the plan of reorganization, to January 19, 2017 and March
20, 2017, respectively.
The Original Debtors, Abengoa Bioenergy US Holding, LLC, et. al.,
currently have until October 21, 2016 to file their plan of
reorganization, and until December 20, 2016 to solicit votes on
their plan of reorganization. On the other hand, Maple Debtors,
Abengoa Bioenergy Meramec Renewable, LLC, et. al., have until
October 10, 2016 to file a plan of reorganization, and until
December 9, 2016, to solicit acceptances to their plan.
The Court entered several Orders collectively approving the sale of
substantially all of the Debtors' assets.
The Debtors relate that they and their professionals have
undertaken substantial efforts to accomplish these major tasks:
(1) assuring smooth transition to operating as debtors in
possession in chapter 11 cases;
(2) restarting two ethanol production facilities that had been
shuttered in late 2015 due to the lack of funding; and
(3) consummating a sale process for substantially all of the
Debtors’ assets.
The Debtors further relate that they worked diligently with their
advisors to obtain DIP Financing, and to develop a budget that
would enable to the Debtors to accomplish their near-term
operational goals, instill confidence in their suppliers,
customers, and employees, and facilitate the marketing process in
order to maximize the value of the Debtors' assets.
The Debtors contend that with the sale of substantially all of
their assets almost complete, the Debtors, together with their
advisors, are currently focused on developing a chapter 11 plan.
The Debtors further contend that they are also working with the
Official Committee of Unsecured Creditors' advisors towards
consensually resolving any issues the Official Committee of
Unsecured Creditors may have with the plan, which will save estate
resources and wind down the chapter 11 cases in a more timely
fashion.
The Debtors tell the Court that an extension of the Exclusivity
Periods will allow them to develop and take all necessary steps to
implement the strategy that will result in the best outcome for all
stakeholders of the Debtors.
The Debtors say that in addition to overseeing the Debtors' chapter
11 cases, the Debtors' management is responsible for guiding
several of the Debtors' affiliates through their chapter 11 cases
in the District of Delaware, which were commenced on April 6, 2016
as part of the Abengoa S.A.'s global restructuring efforts. The
Debtors further say that Abengoa Bioenergy Biomass of Kansas, LLC,
an affiliate of the Debtors that owns a second-generation ethanol
production facility in Hugoton, Kansas, has a chapter 11 case
pending in the District of Kansas. The Debtors add that their
management is also focusing on developing chapter 11 plans for the
Delaware and Kansas Debtors.
The Debtors' Motion is scheduled for hearing on October 19, 2016,
at 10:00 a.m. The deadline for the filing of objections to the
Debtors' Motion is October 12, 2016.
About Abengoa Bioenergy US Holding, LLC.
Abengoa Bioenergy is a collection of indirect subsidiaries of
Abengoa S.A., a Spanish company founded in 1941. The global
headquarters of Abengoa Bioenergy is in Chesterfield, Missouri.
With a total investment of $3.3 billion, the United States has
become Abengoa S.A.'s largest market in terms of sales volume,
particularly from developing solar, bioethanol, and water
projects.
Spanish energy giant Abengoa S.A. is an engineering and clean
technology company with operations in more than 50 countries
worldwide that provides innovative solutions for a diverse range of
customers in the energy and environmental sectors. Abengoa is one
of the world's top builders of power lines transporting energy
across Latin America and a top engineering and construction
business, making massive renewable-energy power plants worldwide.
On Nov. 25, 2015, in Spain, Abengoa S.A. announced its intention to
seek protection under Article 5bis of Spanish insolvency law, a
pre-insolvency statute that permits a company to enter into
negotiations with certain creditors for restricting of its
financial affairs. The Spanish company is facing a March 28, 2016,
deadline to agree on a viability plan or restructuring plan with
its banks and bondholders, without which it could be forced to
declare bankruptcy.
Gavilon Grain, LLC, et al., on Feb. 1, 2016, filed an involuntary
Chapter 7 petition for Abengoa Bioenergy of Nebraska, LLC ("ABNE")
and on Feb. 11, 2016, filed an involuntary Chapter 7 petition for
Abengoa Bioenergy Company, LLC ("ABC"). ABC's involuntary Chapter
7 case is Bankr. D. Kan. Case No. 16-20178. ABNE's involuntary Case
is Bankr. D. Neb. Case No. 16-80141. An order for relief has not
been entered, and no interim Chapter 7 trustee has been appointed
in the Involuntary Cases. The petitioning creditors are represented
by McGrath, North, Mullin & Kratz, P.C.
On Feb. 24, 2016, Abengoa Bioenergy US Holding, LLC and five
affiliated debtors each filed a Chapter 11 voluntary petition in
St. Louis, Missouri, disclosing total assets of $1.3 billion and
debt of $1.2 billion. The cases are pending before the Honorable
Kathy A. Surratt-States and are jointly administered under Bankr.
E.D. Mo. Case No. 16-41161.
The Debtors have engaged DLA Piper LLP (US) as counsel, Armstron
Teasdale LLP as co-counsel, Alvarez & Marsal North America, LLC as
financial advisor, Lazard as investment banker and Prime Clerk LLC
as claims and noticing agent.
ABENGOA SA: U.S. Creditors Want to Launch Probe
-----------------------------------------------
Jonathan Randles, writing for Bankruptcy Law360, reported that U.S.
creditors of Spanish renewable energy developer Abengoa SA sought
permission from a Delaware bankruptcy judge to investigate the
company's finances, a day after Abengoa submitted an overview of a
complicated global plan to restructure billions of dollars in debt.
Abengoa's official committee of unsecured creditors is seeking a
variety of documents that members say will help them determine
whether the company's proposed Chapter 11 plan of reorganization is
in their best interest.
About Abengoa Bioenergy US
Abengoa Bioenergy is a collection of indirect subsidiaries of
Abengoa S.A., a Spanish company founded in 1941. The global
headquarters of Abengoa Bioenergy is in Chesterfield, Missouri.
With a total investment of $3.3 billion, the United States has
become Abengoa S.A.'s largest market in terms of sales volume,
particularly from developing solar, bioethanol, and water
projects.
Spanish energy giant Abengoa S.A. is an engineering and clean
technology company with operations in more than 50 countries
worldwide that provides innovative solutions for a diverse range
of customers in the energy and environmental sectors. Abengoa is
one of the world's top builders of power lines transporting energy
across Latin America and a top engineering and construction
business, making massive renewable-energy power plants worldwide.
On Nov. 25, 2015, in Spain, Abengoa S.A. announced its intention
to seek protection under Article 5bis of Spanish insolvency law, a
pre-insolvency statute that permits a company to enter into
negotiations with certain creditors for restricting of its
financial affairs. The Spanish company is facing a March 28,
2016, deadline to agree on a viability plan or restructuring plan
with its banks and bondholders, without which it could be forced
to
declare bankruptcy.
Gavilon Grain, LLC, et al., on Feb. 1, 2016, filed an involuntary
Chapter 7 petition for Abengoa Bioenergy of Nebraska, LLC ("ABNE")
and on Feb. 11, 2016, filed an involuntary Chapter 7 petition for
Abengoa Bioenergy Company, LLC ("ABC"). ABC's involuntary Chapter
7 case is Bankr. D. Kan. Case No. 16-20178. ABNE's involuntary
case is Bankr. D. Neb. Case No. 16-80141. An order for relief has
not been entered, and no interim Chapter 7 trustee has been
appointed in the Involuntary Cases. The petitioning creditors are
represented by McGrath, North, Mullin & Kratz, P.C.
On Feb. 24, 2016, Abengoa Bioenergy US Holding, LLC and five
affiliated debtors each filed a Chapter 11 voluntary petition in
St. Louis, Missouri, disclosing total assets of $1.3 billion and
debt of $1.2 billion. The cases are pending before the Honorable
Kathy A. Surratt-States and are jointly administered under Bankr.
E.D. Mo. Case No. 16-41161.
The Debtors have engaged DLA Piper LLP (US) as counsel, Armstrong
Teasdale LLP as co-counsel, Alvarez & Marsal North America, LLC as
financial advisor, Lazard as investment banker and Prime Clerk LLC
as claims and noticing agent.
ACTIVECARE INC: Signs Asset Purchase Pact with JMJ Financial
------------------------------------------------------------
ActiveCare, Inc., on Sept. 19, 2016, entered into a Securities
Purchase Agreement with JMJ Financial pursuant to which JMJ
purchased from the Company:
(i) a Promissory Note in the aggregate principal amount of up
to $1,500,000 due and payable on the earlier of Nov. 30,
2016, or the third business day after the closing of the
Public Offering; and
(ii) a Common Stock Purchase Warrant to purchase 10,000,000
shares of the Company's common stock at an exercise price
per share equal to the lesser of (i) 80% of the per share
price of the Common Stock in the Company's contemplated
public offering of securities, (ii) $0.05 per share, (iii)
80% of the unit price in the Public Offering (if
applicable), or (iv) the exercise price of any warrants
issued in the Public Offering.
Additionally, pursuant to the Purchase Agreement, the Company will
issue JMJ $200,000 worth of Common Stock on the 5th trading day
after the pricing of the Public Offering, but in no event later
than Dec. 15, 2016. The number of Origination Shares will equal
$200,000 divided by the lowest of (i) the lowest daily closing
price of the Common Stock during the ten days prior to delivery of
the Origination Shares or during the ten days prior to the date of
the Purchase Agreement (in each case subject to adjustment for
stock splits), (ii) 80% of the common stock offering price of the
Public Offering, (iii) 80% of the unit price offering price of the
Public Offering (if applicable), or (iv) the exercise price of any
warrants issued in the Public Offering
In accordance with its terms, the Purchase Agreement became
effective upon (i) execution by the Parties of the Purchase
Agreement Note, the Warrant, and (ii) delivery of an initial
advance pursuant to the Note of $500,000, which occurred on
Sept. 19, 2016. Pursuant to the Note, JMJ is obligated to provide
the Company an additional $500,000 advance under the Note as
certain milestones, contained within the Note, are achieved. JMJ
may make further advances of up to $500,000 under the Note, in such
amounts and at such times as the Parties may agree. In the event
of an Additional Advance or Further Advance, the Company shall
deliver an additional warrant within three days of such advances in
the form of the Warrant, with the following terms: (i) an aggregate
exercise amount equal to 100% of the principal sum attributable to
the Additional Advance or Further Advance, respectively (ii) at the
per share exercise price then in effect on the Warrant, and (iii)
the number of shares for which the Additional Warrant is
exercisable equal to the aggregate exercise amount for the
Additional Warrant divided by the exercise price. JMJ may, at its
election, exercise the Warrant, and each Additional Warrant, if
any, pursuant to a cashless exercise.
If the Company fails to repay the balance due under the Note, or
issues a Variable Security (as defined in the Note) up to and
including the date of the closing of the Public Offering, JMJ has
the right to convert all or any portion of the outstanding Note
into shares of Common Stock, subject to the terms and conditions
set forth in the Note. All amounts due under the Note become
immediately due and payable upon the occurrence of an event of
default as set forth in the Note.
Partners for Growth IV, L.P. Loan Forbearance
On Sept. 9, 2016, the Company and Partners for Growth IV, L.P., a
Delaware limited partnership entered into a forbearance loan and
security agreement. Pursuant to the terms of the Forbearance
Agreement, PFG will forbear from exercising remedies with regard to
certain breaches of agreements between the Company and PFG,
including the Loan and Security Agreement, dated as of Feb. 19,
2016, between the Company and PFG, and those certain security
agreements entered into in connection therewith. Additionally,
pursuant to the Forbearance Agreement, PFG has provided the Company
with the consent required under the Existing PFG Agreements to
enter into the Purchase Agreement with JMJ and issue the Note and
the Warrant thereunder. The Forbearance, subject to the terms of
the Forbearance Agreement, will last through Oct. 31, 2016, and
encompasses only specific breaches as described in the Forbearance
Agreement.
Conditional Warrant Cancellation Agreement
On Sept. 19, 2016, in connection with the Forbearance Agreement,
the Company, PFG, SVB Financial Group, and PFG Equity Investors,
LLC entered into a Conditionally-Effective Warrant Cancellation
Agreement. Pursuant to the terms of the Warrant Cancellation
Agreement, upon the Company's consummation of an equity financing
of at least $15,000,000, the Warrant Holders agree to terminate and
cancel the warrants they currently hold to purchase an aggregate of
up to 12,015,350 shares of the Company's Common Stock. As an
inducement to enter into the Warrant Cancellation Agreement, the
Warrant Holders will receive upon termination and cancelation of
the warrants an aggregate of 5,400,000 shares of the Company's
Common Stock in the amounts described in the Warrant Cancellation
Agreement. Additionally, if the Warrant Holders terminate and
cancel the warrants, the Company will issue PFG a new unsecured
promissory note in the form of Schedule B to the Warrant
Cancellation Agreement. In the event of issuance, the PFG Note
will have an initial principal amount of $180,000 and will not bear
cash interest. In lieu of cash interest, the principal of the PFG
Note will increase in the amount $3,333.34 each month until the
maturity date.
About ActiveCare
South West Valley City, Utah-based ActiveCare, Inc., develops and
markets products for monitoring the health of and providing
assistance to mobile and homebound seniors and the chronically
ill.
ActiveCare is organized into three business. The Stains and
Reagents segment is engaged in the business of manufacturing and
marketing medical diagnostic stains, solutions and related
equipment to hospitals and medical testing labs. The CareServices
segment is engaged in the business of developing, distributing and
marketing mobile health monitoring and concierge services to
distributors and customers. The Chronic Illness Monitoring segment
is primarily engaged in the monitoring of diabetic patients on a
real time basis.
ActiveCare reported a net loss of $12.8 million on $6.59 million of
chronic illness monitoring revenues for the year ended
Sept. 30, 2015, compared with a net loss of $16.4 million on $6.10
million of chronic illness monitoring revenues for the year ended
Sept. 30, 2014.
As of June 30, 2016, ActiveCare had $1.91 million in total assets,
$21.01 million in total liabilities and a total stockholders'
deficit of $19.10 million.
Tanner LLC, in Salt Lake City, Utah, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Sept. 30, 2015, citing that the Company has recurring losses,
negative cash flows from operating activities, negative working
capital, negative total equity, and certain debt that is in
default. These conditions, among others, raise substantial doubt
about its ability to continue as a going concern.
ALLEGIANT TRAVEL: Scraps Planned $300M Bond to Finance Aircraft
---------------------------------------------------------------
Bloomberg Brief reported that Allegiant Travel scrapped a $300
million junk bond that would have financed the purchase of new
aircraft, blaming "adverse market conditions."
According to the report, Allegiant has announced the withdrawal of
the proposed offering of $300 million aggregate principal amount of
senior notes due in 2023. The airline says that it is due to
market conditions and that it will continue to explore options to
raise secured and unsecured debt, the report said.
The Wall Street Journal reported in July that Allegiant, parent of
an ultradiscount leisure airline whose foundation is inexpensive,
used aircraft, was expected to announce its first order for new
planes in a bid to speed up its transition to a single fleet type
and hasten the retirement of another, older model it operates.
According to WSJ, as part of its second-quarter financial results,
the Las Vegas-based company is slated to disclose an order for 12
A320 single-aisle planes from Airbus Group SE. This will bring to
77 the number of Airbus jets the company is committed to, with 33
already in service with an average age of 12 years old, WSJ said.
As a result, its Allegiant Air unit intends to speed the retirement
of its workhorse MD-80 planes, with all 46 remaining to be out of
its fleet by the end of 2019, Maurice Gallagher, the chief
executive officer, said in an interview with WSJ. The 166-seat
MD-80s, built by a company Boeing Co. acquired, are 26 years old on
average, WSJ said. Older planes tend to burn more fuel and be less
reliable and more costly to maintain, WSJ noted.
* * *
The Troubled Company Reporter, on Sept. 23, 2016, reported that
Moody's Investors Service affirmed Allegiant Travel Company's
Corporate Family Rating (CFR) and Probability of Default Rating
(PDR) of Ba3 and Ba3-PD, respectively, and senior unsecured rating
of B1. Moody's also changed Allegiant's Speculative Grade Liquidity
rating to SGL-3 from SGL-2. The rating outlook is stable.
The TCR, on Sept. 23, also reported that S&P Global Ratings said
that it has lowered its corporate credit rating on Las Vegas-based
Allegiant Travel Co. to 'BB-' from 'BB'. The outlook is stable.
At the same time, S&P assigned its 'BB-' issue-level rating and
'4'
recovery rating to the company's proposed senior unsecured notes.
The '4' recovery rating indicates S&P's expectation that lenders
would receive average recovery (30%-50%; lower end of the range)
in
the event of a payment default.
Additionally, S&P lowered its issue-level rating on the company's
existing senior unsecured notes to 'BB-' from 'BB'. The '4'
recovery rating remains unchanged, indicating S&P's expectation
that lenders would receive average recovery (30%-50%; lower end of
the range) in the event of a payment default.
ALLIANCE ONE: Continues to Monitor Crop Purchases
-------------------------------------------------
In a regulatory filing with the Securities and Exchange Commission,
Alliance One International, Inc. disclosed that it continues to
carefully monitor crop purchases this season. The Brazilian 2016
crop was impacted by significantly higher rain fall attributed to
El Nino weather patterns. As a consequence, yields were
approximately 30% lower in certain regions for Virginia flue-cured
and burley tobaccos compared to the prior year, resulting in a
short crop and a reduction in anticipated processing volumes for
the fiscal year ending March 31, 2017. As a result, AOI
anticipates total Brazilian volumes sold in its fiscal year ending
March 31, 2017, will be lower than those in the prior fiscal year.
The August 2016 report of the Food and Agriculture Organization of
the United Nations highlights a return of La Nina weather patterns,
which is characterized by drier weather in the tobacco growing
areas of south Brazil, which the Company expects could result in
greater than typical historical crop levels in Brazil's 2017
growing season that will be sold in AOI's fiscal year ending March
31, 2018, for which plantings are currently underway.
The Company anticipates, based on current internal forecasts, that
its revenues for the fiscal year ending March 31, 2017, will be
improved compared to revenues for its fiscal year ended March 31,
2016, and its adjusted EBITDA for the fiscal year ending March 31,
2017, will be in the range of approximately $170 million to $185
million.
About Alliance One
Alliance One International is principally engaged in purchasing,
processing, storing, and selling leaf tobacco. The Company
purchases tobacco primarily in the United States, Africa, Europe,
South America and Asia for sale to customers primarily in the
United States, Europe and Asia.
Alliance One reported a net loss of $31.5 million on $261 million
of sales and other operating revenues for the three months ended
June 30, 2016, compared to a net loss of $25.95 million on $266.28
million of sales and other operating revenues for the three months
ended June 30, 2015.
As of June 30, 2016, Alliance One had $1.91 billion in total
assets, $1.67 billion in total liabilities and $242 million in
total equity.
* * *
As reported by the TCR on June 7, 2016, Moody's Investors Service
affirmed Alliance One International, Inc.'s 'Caa2' Corporate
Family Rating and revised the rating outlook to positive from
negative. Alliance One's 'Caa2' Corporate Family Rating reflects
Moody's expectation that credit metrics and liquidity will remain
weak over the next 12 to 18 months.
The TCR reported on Aug. 2, 2016, S&P Global Ratings lowered its
corporate credit rating on Morrisville, N.C.-based Alliance One
International Inc. (AOI) to 'CCC' from 'CCC+'. The rating outlook
is negative.
ALLIANCE ONE: Moody's Hikes Corporate Family Rating to Caa1
-----------------------------------------------------------
Moody's Investors Service upgraded Alliance One International,
Inc.'s Corporate Family Rating (CFR) to Caa1 from Caa2 and
Probability of Default Rating to Caa1-PD from Caa2-PD. Moody's also
upgraded the $720 million senior secured second lien notes to Caa2
from Caa3. At the same time, Moody's assigned a Ba3 rating to the
company's proposed $40 million ABL revolving credit facility and a
B1 rating to $275 million in proposed senior secured first lien
notes. In addition, Moody's affirmed the B1 rating on the company's
existing $210 million first lien revolving credit facility, as well
as the SGL-4 Speculative Grade Rating. The rating on the existing
$210 revolving credit facility will be withdrawn at closing when
the facility is repaid and retired. The outlook on all ratings is
stable.
The Corporate Family Rating upgrade to Caa1 reflects Moody's
somewhat diminished concerns about Alliance One's liquidity. A key
concern being addressed with the proposed refinancing is the
repayment of $200 million outstanding under the company's existing
revolving credit facility that expires in April 2017. Proceeds from
the proposed bond offering will be used to fully repay the $200
million outstanding under existing revolving credit facility.
Approximately $50 million of bond proceeds will be used to reduce
borrowings on uncommitted foreign lines of credit. Remaining
proceeds will increase cash balances.
The new Ba3 rating on the ABL revolving credit facility is four
notches above the Caa1 CFR, reflecting this facility's priority
position to a substantial amount of lower priority debt including
the proposed $275 million first lien notes and the existing $720
million second lien notes. While the ABL revolver and proposed
notes share a first lien on the same collateral, an inter-creditor
agreement gives ABL lenders first priority of payment with regards
to the most liquid assets (including accounts receivables,
inventories, and cash) and second priority of payment with regards
to the remaining assets. The notes have a second priority of
payment with regards to the most liquid assets and a first priority
of payment with regards to the remaining assets. In addition,
Moody's believes the provisions of the proposed ABL revolving
credit facility provide lenders with enhanced ability to minimize
loss. The Ba3 rating is one notch higher than it otherwise would be
rated if the facility did not contain such strong provisions.
The new B1 first lien note rating, three notches above the Caa1
Corporate Family Rating, reflects the notes' priority position to a
meaningful amount of lower priority debt including the $720 million
second lien notes.
The proposed ABL revolver and first lien notes are not guaranteed
by the company's foreign subsidiaries. Foreign subsidiaries account
for approximately 70% of revenue and 83% of assets. The ABL and
notes are structurally subordinated to liabilities at the foreign
subsidiaries, including uncommitted lines of credit and trade
payables. At June 30, 2016 uncommitted lines totaled $943 million
with $458 million drawn.
Ratings Upgraded:
-- Corporate Family Rating to Caa1 from Caa2
-- Probability of Default Rating to Caa1-PD from Caa2-PD
-- $720 million senior secured 2nd lien notes due 2021 to Caa2
(LGD 4) from Caa3 (LGD 5)
Ratings Assigned:
-- $40 million senior secured 1st lien ABL revolving credit
facility at Ba3 (LGD 1)
-- $275 million senior secured 1st lien notes due 2021 at B1
(LGD 2)
Ratings Affirmed:
-- $210 million 1st lien revolving credit facility at B1 (LGD
1) (to be withdrawn at closing)
-- Speculative Grade Liquidity Rating at SGL-4
The outlook on all ratings is stable.
RATINGS RATIONALE
Alliance One's Caa1 Corporate Family Rating reflects Moody's
expectation that credit metrics and liquidity will remain weak over
the next 12 to 18 months. Moody's is concerned that Alliance One's
maintenance of very high financial leverage will make its capital
structure unsustainable long term. Moody's is also concerned about
the company's low level of committed lines of credit. The rating
also reflects Alliance One's position as one of two major leaf
tobacco sourcing, processing, and marketing companies, its
established relationships with key tobacco manufacturing customers,
and its global procurement and processing network.
The stable outlook reflects Moody's expectation that volumes
continue to slowly decline and that the company is able to maintain
its operating profit at average historical levels. It also reflects
Moody's expectation that Alliance One's weak liquidity profile will
not deteriorate.
Ratings could be upgraded if Alliance One improves liquidity and
reduces financial leverage. Specific metrics targets include debt
to EBITDA sustained below 7.0 times, and EBITA to interest expense
sustained above 1.0 time.
Rating could be downgraded if the company's profitability or
liquidity deteriorates.
Headquartered in Morrisville, North Carolina, AOI is one of the
world's leading tobacco processors and merchants. Its principal
products include flue-cured, burley and oriental tobaccos, which
are major ingredients in cigarettes. Revenue for the twelve months
ended June 30, 2016 was approximately $1.9 billion.
ALLIANCE ONE: Offering $275M Senior Secured Notes Due 2021
----------------------------------------------------------
Alliance One International, Inc. announced its intention to offer,
subject to market and other conditions, $275 million in aggregate
principal amount of its senior secured first lien notes due April
15, 2021, to qualified institutional buyers pursuant to Rule 144A
under the Securities Act of 1933, as amended, and to persons in
offshore transactions in reliance on Regulation S under the
Securities Act.
Alliance One intends to use a portion of the net proceeds of the
offering to repay in full all outstanding indebtedness and accrued
and unpaid interest owed under its existing senior secured
revolving credit facility. The Company intends to apply the
remaining net proceeds of the offering for general corporate
purposes, which is anticipated to result in a reduction in the
amount of borrowings under its foreign seasonal lines of credit as
those lines are renewed or replaced.
About Alliance One
Alliance One International is principally engaged in purchasing,
processing, storing, and selling leaf tobacco. The Company
purchases tobacco primarily in the United States, Africa, Europe,
South America and Asia for sale to customers primarily in the
United States, Europe and Asia.
Alliance One reported a net loss of $31.5 million on $261 million
of sales and other operating revenues for the three months ended
June 30, 2016, compared to a net loss of $25.95 million on $266.28
million of sales and other operating revenues for the three months
ended June 30, 2015.
As of June 30, 2016, Alliance One had $1.91 billion in total
assets, $1.67 billion in total liabilities and $242 million in
total equity.
* * *
As reported by the TCR on June 7, 2016, Moody's Investors Service
affirmed Alliance One International, Inc.'s 'Caa2' Corporate
Family Rating and revised the rating outlook to positive from
negative. Alliance One's 'Caa2' Corporate Family Rating reflects
Moody's expectation that credit metrics and liquidity will remain
weak over the next 12 to 18 months.
The TCR reported on Aug. 2, 2016, S&P Global Ratings lowered its
corporate credit rating on Morrisville, N.C.-based Alliance One
International Inc. (AOI) to 'CCC' from 'CCC+'. The rating outlook
is negative.
ALLIANCE ONE: Plans to Enter Into Revolving Credit Facility
-----------------------------------------------------------
Alliance One International, Inc., intends to enter into a credit
agreement with certain bank lenders to establish a revolving
asset-based lending facility. Along with the issuance of senior
secured first lien notes, the ABL Facility will replace Alliance
One's existing $210.3 million senior secured revolving credit
facility.
The ABL Facility may be used for revolving credit loans, swingline
loans and letters of credit from time to time up to an initial
maximum principal amount of $40.0 million, subject to the
limitations. Under certain conditions, Alliance One may solicit
the ABL Lenders or other prospective lenders to provide additional
revolving loan commitments under the ABL Facility in an aggregate
amount not to exceed $25.0 million (less the aggregate principal
amount of any notes exceeding $285.0 million issued under the
indenture governing the notes). The ABL Facility will specify the
maximum amount of letters of credit that may be outstanding at any
one time. The maximum amount of swingline loans that may be
outstanding at any one time is $5.0 million and the amount
available under the revolving credit facility is limited by a
borrowing base consisting of eligible accounts receivable and
inventory as follows:
* 85% of eligible accounts receivable, plus
* the lesser of (i) 85% of the appraised net-orderly-liquidation
value of eligible inventory or (ii) 65% of eligible inventory
valued at the lower of cost (based on a first-in first-out
basis) and market value thereof (net of intercompany profits).
The borrowing base is anticipated to be subject to customary
reserves, which are to be established by the ABL Agent in its
permitted discretion from time to time.
In addition, loans under the ABL Facility shall not be made if
after incurrence of such loans there will be more than $180.0
million of unrestricted cash and cash equivalents in the aggregate
on the consolidated balance sheet of the Company and its
subsidiaries.
The ABL Facility permits both base rate borrowings and LIBOR
borrowings. Borrowings under the ABL Facility will bear interest
at an annual rate equal to LIBOR plus 250 basis points or 150 basis
points above base rate, as applicable, with a fee on unused
borrowings initially at an annual rate of 50 basis points until
March 31, 2017 and thereafter at annual rates ranging from 37.5 to
50 basis points based on our average quarterly historical
utilization under the ABL Facility.
Alliance One expects that the ABL Facility will mature on Jan. 14,
2021.
In addition, customary mandatory prepayments of the loans under the
ABL Facility are expected to be required upon the occurrence of
certain events including, without limitation, certain dispositions
of assets outside of the ordinary course of business in respect of
certain collateral securing the ABL Facility, unrestricted cash and
cash equivalents on the Company's consolidated balance sheet
exceeding $180.0 million for a period of seven consecutive business
days, and certain casualty and condemnation events. With respect
to base rate loans, accrued interest would be payable quarterly in
arrears on the last business day of each calendar quarter and, with
respect to LIBOR loans, accrued interest would be payable on the
last day of any applicable interest period, but not less frequently
than every three months.
The Company's obligations under the ABL Facility (and certain
related obligations and obligations in respect of certain hedging
arrangements) are expected to be (a) guaranteed by its subsidiary,
Alliance One Specialty Products, LLC, and each material domestic
subsidiary of Alliance One (currently there are no material
domestic subsidiaries of Alliance One) and (b) secured by
collateral, which is to consist of (i) security interests in
substantially all of the personal property assets of the Credit
Parties and (ii) mortgages on certain owned real property of the
Credit Parties including those with a value that exceeds a minimum
threshold.
The liens and other security interests granted by the Credit
Parties on the Collateral for the benefit of the ABL Lenders (and
certain related secured parties) will be, subject to certain
permitted liens, first-priority security interests on a pari passu
basis with the security interests securing the notes. The
obligations of Alliance One and Alliance One's guarantors under the
ABL Facility and the notes and any related guarantee will have
respective priorities in a waterfall with respect to portions of
the Collateral to be set forth in an intercreditor agreement to be
entered into by the agent for the ABL Lenders and a collateral
agent with respect to the notes.
Additional information is available for free at:
https://is.gd/WqSzOv
About Alliance One
Alliance One International is principally engaged in purchasing,
processing, storing, and selling leaf tobacco. The Company
purchases tobacco primarily in the United States, Africa, Europe,
South America and Asia for sale to customers primarily in the
United States, Europe and Asia.
Alliance One reported a net loss of $31.5 million on $261 million
of sales and other operating revenues for the three months ended
June 30, 2016, compared to a net loss of $25.95 million on $266.28
million of sales and other operating revenues for the three months
ended June 30, 2015.
As of June 30, 2016, Alliance One had $1.91 billion in total
assets, $1.67 billion in total liabilities and $242 million in
total equity.
* * *
As reported by the TCR on June 7, 2016, Moody's Investors Service
affirmed Alliance One International, Inc.'s 'Caa2' Corporate
Family Rating and revised the rating outlook to positive from
negative. Alliance One's 'Caa2' Corporate Family Rating reflects
Moody's expectation that credit metrics and liquidity will remain
weak over the next 12 to 18 months.
The TCR reported on Aug. 2, 2016, S&P Global Ratings lowered its
corporate credit rating on Morrisville, N.C.-based Alliance One
International Inc. (AOI) to 'CCC' from 'CCC+'. The rating outlook
is negative.
ALLIANCE ONE: S&P Raises CCR to 'CCC+' on Refinancing
-----------------------------------------------------
S&P Global Ratings said that it raised its corporate credit rating
on Morrisville, N.C.-based Alliance One International Inc. (AOI) to
'CCC+' from 'CCC'. The rating outlook is negative.
"At the same time, we assigned a 'B' issue-level rating to the
company's proposed $40 million ABL facility due 2020 with '1'
recovery rating, which indicates our expectation for very high
recovery (90%-100%) in the event of a payment default. We also
assigned a 'CCC+' issue-level rating to its proposed $275 million
senior secured first-lien notes maturing April 2021 with a '3'
recovery rating, indicating our expectation for meaningful recovery
(in at the low end of the 50%-70% range) in the event of a payment
default. The rating on the company's $720 million senior secured
second-lien notes remains 'CCC-', and we revised the recovery
rating to '6' from '5', indicating our expectation for negligible
recovery (in the 0%-10% range) in the event of a payment default,"
S&P said.
S&P will withdraw the ratings on the existing revolving credit
facility when it is repaid and matured.
The upgrade reflects S&P's assumption that the company will
successfully refinance its $210 million revolver with this proposed
debt, thus removing the risk of defaulting on this near-term
maturity. S&P views this transaction as an interim refinancing
step to provide liquidity to fund ongoing operations while making
efforts to improve margins and sustain better cash flows prior to
addressing its substantial first- and second-lien debt maturities
due in 2021 ($275 of first-lien debt in April 2021 and $720 million
of second-lien debt in July 2021). Based on the company's modestly
improving but still difficult operating environment, S&P believes
the company's liquidity and cash generation, including proceeds
from this transaction, will need to be tightly managed to fund
ongoing working capital needs, including drawings on its maturing
revolver. Therefore, S&P do not believe a near-term distressed
exchange on its notes is likely over the next year, though this
risk could become more prominent again beyond a year.
The company's operating performance remains weak, partly reflecting
difficult conditions in the global tobacco leaf industry. The
global oversupply of leaf tobacco and delayed shipments to
customers have led to negative free cash flow because of the
significant working capital build and weak profitability. S&P
expects the working capital trends to reverse, which, coupled with
the company's modest recent restructuring efforts, could lead to
positive free cash flow over the next year. However, the
sustainability of this improvement is highly uncertain, and the
company's ability to continue to meet its ongoing financial
commitments (primarily interest covering and work capital financing
until its 2020 maturity) is contingent on further improvement in
the tobacco leaf industry.
S&P's ratings incorporate the difficult conditions in the tobacco
leaf merchant industry, including volatile currency movements and a
global oversupply of leaf tobacco that has dragged on for a couple
of years, meaningfully reducing volumes and weakening leaf pricing.
While weather patterns and mixed leaf quality have played a role
in weaker volumes, S&P believes the oversupply could be a function
of a secular decline in demand from consumers in developed
economies, and of manufacturers adopting tighter supply chain
processes (including tobacco manufacturers' shorter inventory
procurement patterns). Therefore, S&P may not see a return to
historical demand levels and believe price increases, rather than
volume, will be the primary driver of future revenue growth. A
significant decline in revenues (about 12% in 2015 and another 8%
in 2016) has led to deterioration in credit metrics, which S&P
believes will be difficult to improve over the next year despite
recent restructuring efforts. Financial leverage weakened to well
over 10x at fiscal-year-ended March 31, 2016, compared with S&P's
prior forecast for about 9x, and it expects it to remain above 9x
in fiscal year 2017.
S&P's base-case forecast assumes real global GDP growth in the low-
to mid-3% area over the next several years, with relatively flat
global tobacco consumption. Other assumptions underlying S&P's
forecast include:
-- Low-single-digit revenue growth, as market supply and demand
move toward equilibrium to drive higher prices, but overall
volume stays stagnant. S&P expects low-single-digit sales
growth thereafter, with modest price and volume improvement;
-- Modest EBITDA improvement over the next couple of years
driven by cost savings from the company's global
restructuring program;
-- Around $25 million in capital expenditures in 2017,
including $8 million to rebuild a damaged warehouse in
Zimbabwe. S&P expects around $20 million annually
thereafter; and
-- No acquisitions or dividends.
Based on these assumptions, S&P estimates leverage, funds from
operations (FFO) to debt, and interest coverage in the mid-9x area,
low-single digits, and mid-1x area, respectively, in fiscal 2017.
S&P expects metrics will improve modestly but remain weak
thereafter.
S&P's ratings also incorporate the company's narrow focus in the
intensely competitive and volatile tobacco leaf industry merchant
industry and operations in high-risk regions, which expose the
company to political and economic uncertainties. The company's
recent financial performance has exhibited its exposure and
vulnerability to risks associated with the industry, including
supply and demand imbalances, fluctuations in input costs, foreign
exchange movements, and the ability to collect advances from
farmers, some of whom operate in high-risk regions. AOI also has
material customer concentrations with some of the largest cigarette
manufacturers in the world.
While S&P believes some of these manufacturers are shifting more of
their tobacco sourcing to third-party tobacco leaf merchants, all
of them maintain at least some direct sourcing operations, and
future actions to expand these operations remains a risk factor for
AOI. The size and scale of these companies, along with the threat
of vertical integration, limit AOI's bargaining power. The recent
accounting discrepancies and apparent employee collusion at the
company's Kenyan subsidiary, which caused the company to delay
filing financial statements and to restate past financial
statements, demonstrate some of the challenges associated with
operating in high-risk regions.
The negative outlook reflects the company's very high leverage,
difficult operating environment, as well as the possibility that
the company might repurchase its senior secured second-lien notes
at a material discount to par value. In S&P's forecast, it assumes
modest sales and EBITDA growth as volumes stabilize, prices rise,
and the company realizes cost savings from its restructuring
efforts. Although S&P believes supply and demand are moving toward
equilibrium, it believes the decline in demand may be secular in
nature and that pricing, rather than volume, will drive sales
growth. S&P expects modestly improved, albeit still very weak,
credit metrics and positive cash flow over the next 12 months.
S&P could revise the outlook to stable if the company's operating
performance improves so that the company sustains positive free
cash flow, meaningful covenant cushion, and EBITDA coverage of
interest close to 2x.
ALLIED CONSOLIDATED: Wants Jan. 31 Solicitation Period Extension
----------------------------------------------------------------
Allied Consolidated Industries, Inc. asks the U.S. Bankruptcy Court
for the Northern District of Ohio to extend its exclusive period to
solicit acceptances of its plan of reorganization through January
31, 2017.
The Debtor filed its plan of reorganization and disclosure
statement on August 10, 2016, within the Debtor's exclusive period
to file a plan. The Debtor relates that a hearing to consider
approval of the disclosure statement was held on September 27,
2016, and that a further hearing is tentatively scheduled for
November 15, 2016, on a second amended disclosure statement to be
filed in the case.
The Debtor tells the Court that although it has made substantial
progress in this case, the complexity of the business assets
justifies an extension of the already short 60-day Exclusive
Solicitation Period. The Debtor further tells the Court that the
business assets are mostly industry specific consisting of hundreds
of tons of scrap metal to computer driven CNC milling machines.
The Debtor contends that it has made substantial progress towards
the goal of reorganizing and exiting bankruptcy during the short
time since the Petition Date. It further contends that the
requested extension will not result in harm or undue delay of the
plan process. The Debtor asserts that it is seeking an extension
of the solicitation period to preserve the exclusivity period
achieved when it filed a plan within the first 120 days. It
further asserts that the Debtor and its professionals will continue
to work vigorously in seeking approval of the disclosure statement,
as amended, and ultimately confirmation of a plan of reorganization
for the benefit of all stakeholders.
About Allied Consolidated Industries, Inc.
Allied Consolidated Industries Inc. filed a chapter 11 petition
(Bankr. N.D. Ohio Case No. 16-40675) on April 13, 2016. The
petition was signed by John R. Ramun, president. The Debtor is
represented by Melissa M. Macejko, Esq., at Suhar & Macejko, LLC.
The case is assigned to Judge Kay Woods. The Debtor estimated both
assets and liabilities in the range of $0 to $50,000.
ALPHA DINER: Unsecureds To Recover 3% Under Plan
------------------------------------------------
Alpha Diner Corp. filed with the U.S. Bankruptcy Court for the
Eastern District of New York a disclosure statement for the
Debtor's plan of reorganization.
Scheduled Class 3 General Unsecured Claims include (1) scheduled
trade creditors in the amount of total $16,026.22 and (2) a class
action wage claim, disputed by the Debtor, filed in the amount of
$9,625,459.39.
Under the Plan, the Debtor will make distributions to unsecured
creditors over a five-year period. The Debtor will make monthly
payments, to a segregated interest bearing bank account, in the
amount of $5,000 per month for five years, for an aggregate amount
of $300,000. Distributions will issue to Class 3 creditors every
six months during the5 year plan, with the first distribution
checks to issue starting six months after the effective date of the
Plan. The distribution to unsecured creditors is difficult to
estimate because of the contingent nature of the wage claim. In
the event the wage claim is allowed as filed, creditors will
receive a 3% distribution.
Distributions under the Plan will come from the Debtor's ongoing
operations. The Debtor will make monthly payments into an interest
bearing segregated account, and will issue distributions to
unsecured creditors on a bi-annual basis. The length of the Plan
is five years.
The Disclosure Statement is available at:
http://bankrupt.com/misc/nyeb16-40648-31.pdf
About Alpha Diner
Alpha Diner Corp. operates a restaurant in Queens, New York. Alpha
Diner Corp. sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. E.D.N.Y. Case No. 16-40648) on Feb. 19, 2016. The
Petition was signed by its President, Dimitrios Athanasopoulos.
The Debtor is represented by Lawrence Morrison, Esq., at Morrison
Tenenbaum, PLLC. At the time of filing, the Debtor had $50,000
each in estimated assets and estimated liabilities.
AMERICAN APPAREL: General Counsel Grayson Said to Assume CEO Post
-----------------------------------------------------------------
Kat Greene, writing for Bankruptcy Law360, reported that American
Apparel Inc. is reportedly replacing Paula Schneider, brought on in
January 2015 to turn the retailer around after a bankruptcy and the
ousting of the company's founder, with General Counsel Chelsea
Grayson, an ex-Loeb & Loeb LLP partner whose expertise lies in
mergers and acquisitions. American Apparel will place Grayson at
its head on Oct. 3, 2016, according to reports in the Los Angeles
Times. Grayson had been general counsel for American Apparel for
nearly two years before her promotion to lead the company.
About American Apparel
American Apparel, Inc., American Apparel (USA), LLC, American
Apparel Retail, Inc., American Apparel Dyeing & Finishing, Inc.,
KCL Knitting, LLC and Fresh Air Freight, Inc. sought Chapter 11
bankruptcy protection (Bankr. D. Del. Proposed Lead Case No.
15-12055) on Oct. 5, 2015. The petition was signed by Hassan
Natha as chief financial officer.
The Debtors reported total assets of $199,360,934 and total
liabilities of $397,576,744.
The Debtors and their non-debtor affiliates operate a vertically
integrated manufacturing, distribution, and retail business
focused on branded fashion-basic apparel, employing approximately
8,500 employees across six manufacturing facilities and
approximately 230 retail stores in the United States and 17 other
countries worldwide.
The Debtors have engaged Jones Day as restructuring counsel,
Pachulski Stang Ziehl & Jones LLP as local counsel, Moelis &
Company as investment banker, FTI Consulting, Inc. as financial
advisor, DJM Real Estate as real estate consultant and Garden City
Group, LLC as claims and noticing agent.
* * *
The Debtors filed a proposed Joint Plan of Reorganization that
contemplates converting more than $200 million of senior notes
into equity interests of the reorganized American Apparel.
On Nov. 20, 2015, the Court approved the Disclosure Statement and
set a Jan. 7, 2016 voting deadline and a Jan. 20 plan confirmation
hearing.
On Jan. 10, 2016, the Debtors received a letter from former CEO
Dov Charney disclosing a proposed $300 million alternative
transaction that will be funded by Hagan Capital Group and Silver
Creek Capital Partners but American Apparel rejected the proposal.
On Jan. 25, 2016, the Court held a telephonic hearing, granting
confirmation of the Debtors' First Amended Plan, provided certain
revisions were made to the First Amended Plan and the proposed
confirmation order.
On Jan. 27, 2016, the Court entered an order confirming American
Apparel's First Amended Joint Plan of Reorganization, under which,
on Feb. 5, 2016, the Effective Date of the Plan, all shares of
Common Stock and other equity interests in the Company were
cancelled and terminated, and the Company was converted into a
Delaware limited liability company with membership interests
Issued
to unitholders, including certain Reporting Persons, in accordance
with the Plan.
ANTERO RESOURCES: S&P Retains 'BB' Sr. Unsecured Rating
-------------------------------------------------------
S&P Global Ratings revised its recovery rating on Denver–based
Antero Resources Corp.'s senior unsecured notes to '3' from '4'.
The '3' recovery rating indicates its expectation for meaningful
(50%-70%; upper half of the range) recovery of principal for
creditors in the event of a payment default. The 'BB' issue-level
rating on the notes remains unchanged.
S&P estimates that Antero will continue to increase its reserves
and production in the Marcellus and Utica through the updated
mid-year guidance.
RECOVERY ANALYSIS
Key analytical factors:
-- S&P's simulated default scenario contemplates a default in
2021 due to a sustained period of low commodity prices
(consistent with the conditions of past defaults in this
sector).
-- S&P based its valuation of Antero's reserves on S&P's
estimated mid-year 2016 PV-10 report, using S&P's recovery
price deck assumptions of $50 per barrel for WTI crude oil
and $3.00 per million British thermal units for Henry Hub
natural gas.
-- S&P caps the value for proved undeveloped reserves so that
they account for no more than 25% of the value of the proved
reserves, given the heightened uncertainty about the cost of
extracting these reserves.
-- S&P's recovery analysis for Antero also incorporates the
company's $4 billion of commitments less the $708 million
letters of credit outstanding on its senior secured reserve-
based loan facility, which S&P assumes will be fully drawn
at default.
Simulated default assumptions:
-- Simulated year of default: 2021
Simplified waterfall:
-- Reserve-based loan claims: $3.4 billion
-- Recovery expectations: Not applicable
-- Senior unsecured notes claims: $3.5 billion
-- Recovery expectation: 50%-70% (upper half of the range)
Note: All debt amounts include six months of prepetition interest.
RATINGS LIST
Antero Resources Corp.
Corporate Credit Rating BB/Stable/--
Ratings Unchanged; Recovery Ratings Revised
To From
Antero Resources Corp.
Antero Resources Finance Corp.
Senior Unsecured BB BB
Recovery Rating 3H 4L
ARMADA WATER: Court Moves Plan Filing Deadline to December 19
-------------------------------------------------------------
Judge David R. Jones of the U.S. Bankruptcy Court for the Southern
District of Texas extended the exclusive periods of Armada Water
Assets, Inc. and its subsidiaries to file and solicit acceptance of
a plan to Dec. 19, 2016 and Feb. 17, 2017, respectively.
As reported earlier by the Troubled Company Reporter, the Debtors
requested the Court to extend the exclusive periods to file and
solicit acceptance of a plan to Jan. 18, 2017 and March 20, 2017,
respectively.
The Debtors seek for an expedited relief because they learned of
two new issues that require additional time to draft and file a
plan, to wit:
(a) the discovery of an alleged Joint Development Agreement
with RecyClean Consulting Services, Inc., and
(b) the United States Trustee's appointment of an Official
Committee of Unsecured Creditors two weeks ago.
The Counsel to the Debtors, and indeed all of the Debtors' officers
and directors with the exception of the former CFO Sami Ahmad, were
unaware of the executed Recyclean JDA until after the recent
section 341 meeting. The Recyclean JDA could impact the new
technology that is a component of the Debtors' contemplated plan
for which the Debtors must investigate before filing their plan.
The Debtors and Recyclean are discussing options, but are unlikely
to resolve the issue before September 20, 2016.
The Debtors intend to work with counsel for the Committee toward
the goal of filing a consensual plan with respect to the recent
appointment of a Committee. The Debtors believe that given the
delayed appointment, the Debtors and the Committee will probably
not complete negotiations before September 20, 2016.
About Armada Water Assets
Armada Water Assets, Inc., and its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead
Case No. 16-60056) on May 23, 2016. The petition was signed by Tom
Breen, chief restructuring officer.
The cases are pending joint administration before Judge David R.
Jones under proposed Lead Case No. 16-60056.
The Debtors estimated both assets and liabilities in the range of
$10 million to $50 million.
The U.S. Trustee for the Southern District of Texas, on Aug. 18
appointed two creditors of Armada Water Assets, Inc., et al., to
serve on the official committee of unsecured creditors. The
committee members are: Pac-Van, Inc., and M & M Excavation Inc.
ATNA RESOURCES: ARI Unsecureds to Recoup 8% Under Liquidation Plan
------------------------------------------------------------------
Atna Resources Inc., and its affiliated debtors filed with the U.S.
Bankruptcy Court for the District of Colorado its disclosure
statement explaining their Chapter 11 Joint Plan of Liquidation.
The Debtors have a total of 240 General Unsecured Claims amounting
to $19,650,671. Outlined below is the estimated claims amounts
against each Debtors and corresponding recoveries of holders of the
General Unsecured Claims:
-- Atna Resources Ltd. with General Unsecured Claims amounting
to $1,634,162.05, will recover 5% of its allowed claims.
-- Canyon Resources Corporation with General Unsecured Claims
amounting to $141,329.95, will recover 36% of its allowed claims.
-- CR Briggs Corporation with General Unsecured Claims amounting
to $3,589,424.04, will recover 1% of its allowed claims.
-- CR Montana Corporation with General Unsecured Claims
amounting to $2,296.37, will recovery 100% of its allowed claims.
-- CR Kendall Corporation with General Unsecured Claims
amounting to $6,415,135.30, will recover 2% of its allowed claims.
-- Atna Resources Inc. with General Unsecured Claims amounting
to $7,868,323.71, will recover 8% of its allowed claims.
The Debtors propose to appoint a Liquidating Trustee and a
Liquidating Trust Committee as a means for implementation and
execution of the Plan. The Liquidating Trustee shall be deemed the
Estates’ representative who will have the right to:
(1) effect all actions and execute all agreements, instruments
and other documents necessary to implement the provisions of the
Plan and the Liquidating Trust Agreement;
(2) liquidate the assets transferred to the Liquidating Trust
Fund on the Effective Date;
(3) prosecute, settle, abandon or compromise any Retained
Causes of Action;
(4) make Distributions;
(5) establish and administer any necessary reserves for
Disputed Claims that may be required;
(6) object to the Disputed Claims and prosecute, settle,
compromise, withdraw or resolve in any manner approved by the
Bankruptcy Court such objections; and
(7) employ and compensate professionals and other agents.
To recall, the Debtors sought and obtained approval to sell their
assets to the following:
-- Waterton. Waterton was selected as the successful bidder for
the following assets: (i) the Debtors' Pinson Project for a credit
bid in the amount of $5 million, $500,000 of which was a credit bid
of the DIP Obligations; (ii) the Debtors' Columbia project for a
credit bid in the amount of $1.6 million from the DIP Obligations
and a grant of a one percent (1%) Net Profit Interest to Debtor CR
Montana Corporation with a five year term valued by the Debtors at
$1 million; (iii) certain royalty rights known as the "Copper
Cliffs Royalty" for a credit bid in the amount of $250,000 from the
DIP Obligations; and (iv) a royalty right held by Debtor Canyon
Resources Corporation to receive 50% of a 3% royalty interest in
Debtor CR Briggs Corporation for a credit bid in the amount of
$250,000 from Pre-Petition Indebtedness.
-- DV Natural Resources. DV Natural Resources was selected as
the successful bidder and acquired the Debtors' Briggs project for
consideration consisting of (i) the assumption of all of the Briggs
project's reclamation and environmental obligations, (ii) the
assumption of the surety bonds issued with respect to the Briggs
project and the related cash collateral, and (iii) the agreement of
Debtor CR Briggs Corporation to make an advance deposit of $180,000
for an engine repair necessary for the Briggs project.
-- The Solitario Bid. Solitario was selected as the successful
bidder and acquired a royalty right related to mineral rights owned
by Debtor CR Montana Corporation for a $50,000 cash payment.
-- The WRH Nevada Bid. WRH Nevada was selected as the successful
bidder and acquired mineral rights owned by Debtor CR Montana
Corporation for a $350,000 cash payment.
A full-text copy of the Disclosure Statement dated September 14,
2016 is available at https://is.gd/c9uHEd
About Atna Resources
Headquartered in Lakewood, Colorado, Atna Resources Ltd. --
http://www.atna.com/-- is engaged in all phases of the mining
business, including exploration, preparation of pre-feasibility and
feasibility studies, permitting, construction and development,
operation and final closure of mining properties.
The Company owns or controls various properties with gold
resources. The Company's production property includes Briggs Mine
California and Pinson Mine Property, Nevada. The Company's
development properties include Mag Pit at Pinson; Columbia Project,
Montana and Briggs Satellite Projects, California. Its Exploration
properties include Sand Creek Uranium Joint Arrangement, Wyoming;
Blue Bird Prospect, Montana and Canadian Properties, Yukon and
British Columbia. Its Closure Property is Kendall, Montana. The
Briggs mine is located on approximately 156 unpatented claims,
including approximately 15 mill site claims, covering over 2,890
acres. The Company's Pinson Mine Property is located in Humboldt
County, Nevada, over 30 miles east of Winnemucca.
Atna Resources, Inc. and its direct and indirect subsidiaries filed
Chapter 11 bankruptcy petitions (Bankr. D. Colo. Proposed Lead Case
No. 15-22848) on Nov. 18, 2015. The petitions were signed by
Rodney D. Gloss as vice president & chief financial officer.
Atna also sought ancillary relief in Canada pursuant to the
Companies' Creditors Arrangement Act in the Supreme Court of
British Columbia in Vancouver, Canada.
In its Chapter 11 petition, Atna estimated assets in the range of
$10 million to $50 million and liabilities of $50 million to $100
million.
Squire Patton Boggs (US) LLP serves as counsel to the Debtors.
On Dec. 14, 2015, the Office of the United States Trustee for the
District of Colorado appointed a statutory committee of unsecured
creditors in the Chapter 11 Cases. The Committee tapped Onsager
Guyerson Fletcher Johnson as attorneys.
AUTHENTIDATE HOLDING: Files Transition Report on Form 10-KT
-----------------------------------------------------------
Authentidate Holding Corp. filed with the Securities and Exchange
Commission a transition report on Form 10-KT for the period from
Jan. 1, 2015, to June 30, 2015.
In the Transitional Report on Form 10-KT, references to (1) "AEON"
refers to Peachstate Health Management LLC, d/b/a AEON Clinical
Laboratories prior to the AEON Acquisition; (2) the "Company,"
refers to Authentidate Holding Corp. and its wholly-owned
subsidiaries, including AEON, after the AEON Acquisition; (3)
"Authentidate" or "AHC" refers to the Authentidate Holding Corp.
prior to the AEON Acquisition.
On Jan. 27, 2016, AEON completed the transaction contemplated by
the Merger Agreement with Authentidate Holding Corp under which
AEON merged with a wholly owned subsidiary of Authentidate and will
be operated as a separate entity. The merger was accounted for as
a reverse acquisition with AEON treated for accounting purposes as
the acquirer. As such, the financial statements of AEON are
treated as the historical financial statements of the Company.
Effective as of the closing of the AEON Acquisition, AEON changed
its fiscal year-end from December 31 to June 30 in order to conform
to Authentidate’s fiscal year-end.
For the transition period from Jan. 1 to June 30, 2015, Peachstate
Health Management, LLC and Subsidiary d/b/a/ AEON Clinical
Laboratories reported net income of $3.79 million on $11.4 million
of net revenues.
For the year ended Dec. 31, 2014, Peachstate Health Management, LLC
and Subsidiary d/b/a/ AEON Clinical Laboratories reported net
income of $10.8 million on $24.1 million of net revenues compared
to net income of $8.22 million on $15.5 million of net revenues for
the year ended
Dec. 31, 2013.
As of June 30, 2015, Peachstate Health Management, LLC and
Subsidiary d/b/a/ AEON Clinical Laboratories had $7.82 million in
total assets, $2.43 million in total liabilities and $5.39 million
in total members' equity.
A full-text copy of the Form 10-KT is available for free at:
https://is.gd/s30tv1
About Authentidate
Authentidate Holding Corp. and its subsidiaries provide secure
web-based revenue cycle management applications and telehealth
products and services that enable healthcare organizations to
increase revenues, improve productivity, reduce costs, coordinate
care for patients and enhance related administrative and clinical
workflows and compliance with regulatory requirements. The
Company's web-based services are delivered as Software as a Service
(SaaS) to its customers interfacing seamlessly with billing,
information and document management systems. These solutions
incorporate multiple features and security technologies such as
business-rules based electronic forms, intelligent routing,
transaction management, electronic signatures, identity
credentialing, content authentication, automated audit trails and
remote patient management capabilities. Both web and fax-based
communications are integrated into automated, secure and trusted
workflow solutions.
Authentidate reported a net loss of $9.7 million on $3.68 million
of total revenues for the year ended June 30, 2015, compared to a
net loss of $7.14 million on $5.55 million of total revenues for
the year ended June 30, 2014.
As of Dec. 31, 2015, Authentidate had $3.41 million in total
assets, $9.55 million in total liabilities and a $6.14 million
total shareholders' deficit.
EisnerAmper LLP, in New York, issued a "going concern"
qualification on the consolidated financial statements for the year
ended June 30, 2015, citing that the Company's recurring losses
from operations and negative cash flows from operations raise
substantial doubt about its ability to continue as a going concern.
AUTHENTIDATE HOLDING: Incurs $45,200 Net Loss in Third Quarter
--------------------------------------------------------------
Authentidate Holding Corp. filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $45,198 on $7.61 million of total net revenues for the three
months ended March 31, 2016, compared to net income of $1.69
million on $4.80 million of total net revenues for the three months
ended March 31, 2015.
For the nine months ended March 31, 2016, Authentidate reported net
income of $9.03 million on $30.21 million of total net revenues
compared to net income of $7.13 million on $17.8 million of total
net revenues for the nine months ended March 31, 2015.
As of March 31, 2016, Authentidate had $55.2 million in total
assets, $11.5 million in total liabilities and $43.7 million in
total shareholders' equity.
At March 31, 2016, cash and cash equivalents amounted to $2.76
million and total assets at that date were $55.2 million compared
to June 30, 2015 cash and cash equivalents of $5.19 million and
total assets of $7.83 million. The Company's current estimated
monthly operational requirements are approximately $2.20 million.
For the nine months ended March 31, 2016, net cash provided by
operating activities was approximately $7.81 million, net cash used
by investing activities was $1.086 million, and net cash used by
financing activities totaled $9.15 million. During the nine months
ended March 31, 2016, there was a net decrease in cash of 2.43
million.
The Company does not have a bank line of credit or other fixed
source of capital reserves. Should it need additional capital in
the future, the Company said it will attempt to either (i) enter
into a bank line of credit or (ii) issue its debt securities in a
private or public offering. There can be no guarantee or assurance
that the Company will be successful in any such efforts.
Management believes the Company has sufficient capital to meet its
planned operating needs for the next 12 months.
The Company's quarterly report on Form 10-Q is available from the
SEC Web site at
https://is.gd/jUaZCT
About Authentidate
Authentidate Holding Corp. and its subsidiaries provide secure
web-based revenue cycle management applications and telehealth
products and services that enable healthcare organizations to
increase revenues, improve productivity, reduce costs, coordinate
care for patients and enhance related administrative and clinical
workflows and compliance with regulatory requirements. The
Company's web-based services are delivered as Software as a Service
(SaaS) to its customers interfacing seamlessly with billing,
information and document management systems. These solutions
incorporate multiple features and security technologies such as
business-rules based electronic forms, intelligent routing,
transaction management, electronic signatures, identity
credentialing, content authentication, automated audit trails and
remote patient management capabilities. Both web and fax-based
communications are integrated into automated, secure and trusted
workflow solutions.
Authentidate reported a net loss of $9.7 million on $3.68 million
of total revenues for the year ended June 30, 2015, compared to a
net loss of $7.14 million on $5.55 million of total revenues for
the year ended June 30, 2014.
EisnerAmper LLP, in New York, issued a "going concern"
qualification on the consolidated financial statements for the year
ended June 30, 2015, citing that the Company's recurring losses
from operations and negative cash flows from operations raise
substantial doubt about its ability to continue as a going concern.
AZURE MIDSTREAM: Adopts Incentive and Retention Bonus Program
-------------------------------------------------------------
The Compensation Committee of Azure Midstream Partners GP, LLC, on
behalf of the Partnership has adopted a Partnership Incentive and
Retention Bonus Program.
Terms of Retention of Retention Program include:
* Payment of cash bonuses to employees and consultants engaged
by the General Partner who provide services on behalf of the
Partnership.
* Amounts of bonus payments determined by the General Partner's
president or another officer to when he delegates authority.
* Awards may be of two types:
1) Awards payable in three installments, with the first two of
such installments in the amount of 25% of the total award,
which installments are to be paid as of November 1, 2016 and
February 1, 2017, and with the third such installment in the
amount of 50% of the total award, which installment is to be
paid as of August 1, 2017; and
2) Awards payable 100% in one payment to be paid as of
December 1, 2016;
* Recipients must be employed or engaged by the General Partner
as of the date of payment, unless paid earlier as a result of
a change in control of the Partnership or the General
Partner's terminating the recipient's employment or engagement
without cause.
* Bonuses paid by the Partnership under the Retention Program
may not exceed $1,000,000 in the aggregate, excluding employer
burden.
Bonuses of the first type, payable in three installments, have been
awarded under the Retention Program to the following named
executive officers in the following amounts: Amanda Bush, chief
financial officer, $130,625 and David Garrett, vice president -
commercial, $142,500.
A copy of the Partnership Incentive and Retention Bonus Program
is available for free at https://is.gd/UBCHes
About Azure Midstream
Azure Midstream Partners, LP, is a publicly traded Delaware master
limited partnership that was formed by NuDevco Partners, LLC and
its affiliates to develop, own, operate and acquire midstream
energy assets. The Company currently offers: (i) natural gas
gathering, compression, dehydration, treating, processing, and
hydrocarbon dew-point control and transportation services to
producers, marketers and third-party pipeline companies through our
gathering and processing business segment; and (ii) crude oil
logistics services to Associated Energy Services, LP, an affiliate,
through its logistics business segment.
As of June 30, 2016, Azure had $418.37 million in total assets,
$236.88 million in total liabilities and $181.48 million in total
partners' capital.
Azure reported a net loss of $222.42 million for the year ended
Dec. 31, 2015, compared to a net loss of $6.82 million for the year
ended Dec. 31, 2014.
KPMG LLP, in Dallas, Texas, issued a "going concern" qualification
on the consolidated financial statements for the year ended
Dec. 31, 2015, citing that the Partnership anticipates being out of
compliance with the requirements in the Credit Agreement during
2016, which would accelerate the maturity of the outstanding
indebtedness making it currently due and payable. The Partnership
does not have sufficient liquidity to meet the accelerated debt
service requirements. This issue raises substantial doubt about
its ability to continue as a going concern.
* * *
As reported by the TCR on Sept. 23, 2016, S&P Global Ratings
lowered its corporate credit rating on Azure Midstream Energy LLC
to 'CCC+' from 'B-'. "The downgrade reflects our view that Azure's
credit measures have worsened due to unfavorable commodity prices
and weak industry conditions, which has made it more challenging to
meet its financial commitments," S&P Global Ratings analyst Mike
Llanos said.
The TCR reported on Aug. 15, 2016, that Moody's Investors Service
downgraded Azure Midstream Energy LLC's Corporate Family Rating
(CFR) to Caa2 from B3, Probability of Default Rating (PDR) to
Caa2-PD from Caa1-PD, senior secured term loan rating to Caa2 from
B3, and the senior secured revolving credit facility rating to B1
from Ba3. The Speculative Grade Liquidity rating was withdrawn. The
outlook remains negative.
BARBARA GORANSSON: Unsecureds To Get $25,000 Under Plan
-------------------------------------------------------
Barbara Goransson filed with the U.S. Bankruptcy Court for the
Southern District of Florida a disclosure statement describing the
Debtor's plan of reorganization.
Under the Plan, Class 3 General Unsecured Claims are impaired.
Holders of these claims will share in a total distribution of
$25,000 pro rata. Payments of $5,000 will be distributed pro rata
on an annual basis, starting on the first of the month after the
Effective Date, until the aggregate amount of $25,000 is paid.
The Debtor has adequate compensation from her LLCs which will prove
feasibility, and after completing extensive repairs to her
homestead, will very likely be able to refinance her mortgage.
Coupled with the restructured debt terms described in the
Disclosure Statement and with positive future projections of cash
flow, the Debtor believes that the payment plan proposed in this
Disclosure Statement are feasible. Monthly net cash flows, before
and after debt service, are more than sufficient to fund the
existing Plan.
The Disclosure Statement is available at:
http://bankrupt.com/misc/flsb13-32445-237.pdf
The Plan was filed by the Debtor's counsel:
Aaron A. Wernick, Esq.
FURR COHEN, P.A.
2255 Glades Road, Suite 337W
Boca Raton, Florida 33431
Tel: (561) 395-0500
Fax: (561) 338-7532
E-mail: awernick@furrcohen.com
Barbara Goransson Debtor is an individual who owns her own
homestead and also has ownership interests in these limited
liability companies: 100% ownership interest in Cody Holdings, LLC,
100% ownership interest in Earth Wise Properties, LLC, 100%
ownership interest in TLC Realty, LLC, 100% ownership interest in
Efterlevande Enterprises, 100% ownership interest in Solsken
Enterprises, 19% indirect ownership interest in Venergy Group, LLC,
and 9.5% indirect ownership interest in Global Energy Technology,
LLC.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr. S.D.
Fla. Case No. 13-32445) on Sept. 20, 2013.
BARBARA MAGNUSSON: Trustee Selling Spring Lake Property for $2.6M
-----------------------------------------------------------------
Barry W. Frost, Chapter 11 Trustee for the estate of debtor Barbara
Magnusson, asks the U.S. Bankruptcy Court for the District of New
Jersey to authorize the private sale of the Debtor's interest in
the real property located at 14 Newark Avenue, Spring Lake, New
Jersey ("Property") to Joseph Bilotta and Donna Gierek for
$2,550,000, subject to higher and better offers.
A hearing on the Motion is set for Oct. 25, 2016 at 10:00 a.m. The
objection deadline is Oct. 18, 2016.
The Debtor does claim an exemption on the Property on Schedule C of
her Petition in the amount of $19,600.
On July 2, 2015, the Court entered an Order authorizing the
retention of Orrico Realty to assist the Trustee in marketing and
selling the estate' interest in the Property.
After marketing the Property, the Trustee garnered an offer from a
Buyer to purchase the estate's interest in the Property.
The Trustee engaged in arm's-length negotiations with the Buyer
pursuant to which the Trustee agreed to sell the Property to the
Buyer for $2,550,000 pursuant to the terms of the proposed
Agreement of Sale.
A copy of the Agreement of Sale attached to the Motion is available
for free at:
http://bankrupt.com/misc/Barbara_Magnusson_301_Sales.pdf
After carefully evaluating the Buyer's offer and the potential for
additional offers, the Trustee has determined that the price
offered by the Buyer is the highest and best price the Trustee can
obtain for the estate's interest in the Property under the
circumstances.
The salient terms of the Agreement of Sale are:
a. The Parties: The seller under the Agreement of Sale is the
Trustee, not individually or personally but on behalf of the
Debtor's bankruptcy estate and ownership interest in the Property.
The purchasers are Joseph Bilotta and Donna Gierek.
b. The Property: The land together with the buildings,
structures and improvements thereon and the appurtenances thereto,
situated at Lot 18, Block 95 and more commonly known as 14 Newark
Avenue, Spring Lake, New Jersey with all rights and title
pertaining thereto.
c. The Purchase Price: The total consideration for the sale of
the Property is $2,550,000.
d. The Deposit: The sum of $128,000 is to be paid by the Buyer,
which will be held by the Buyer's attorney.
e. "As Is, Where Is": The Buyer agrees to accept the Property
in its "as is" condition. The Trustee makes no representations or
warranties whatsoever.
f. Bankruptcy Court Approval: The sale of the estate's interest
in the Property is subject to Bankruptcy Court approval.
g. Existing Mortgage Lien: The sale will be free and clear of
all liens, claims encumbrances with the exception of the first
mortgage of Ocwen Loan Servicing, LLC as servicer for U.S. Bank
National Association, as Trustee for GSR Mortgage Loan Trust
2006-ARI, mortgage pass-through certificates series 2006-AR1 and
the second mortgage of 14 Newark Ave - SL, LLC which are to receive
a fixed distribution from the proceeds of sale.
Based upon the above reductions, the breakdown of sale proceeds
will be:
Sale Price: $2,550,000
Ocwen First Mortgage: $2,000,000
14 Newark Second Mortgage: $ 300,000
Broker's Commission: $ 127,500
Net Proceeds to the Estate: $ 122,500
The Trustee will accept all higher and better offers on the
estate's interest in the Property up to and including the hearing
date. All bidders must have $10,000 in certified funds on the
hearing date in order to bid.
Waiving the 14-day stay under Bankruptcy Rule 6004(h) is necessary
to permit the Trustee to minimize these costs by closing the
proposed sale transaction as soon as possible after the entry of
the Sale Order.
The Purchasers can be reached at:
Joseph Bilotta
Donna Gierek
160 Overlook Ave. Unit 6E2
Hackensack, NJ 07601
Barbara Magnusson sought Chapter 11 protection (Bankr. D.N.J. Case
No. 13-31122) on Sept. 27, 2013. The Debtor tapped Bunce Atkinson,
Esq., at Atkinson & DeBartolo, as counsel.
BATE LAND & TIMBER: Bid to Dismiss BLC Appeal Granted
-----------------------------------------------------
On September 6, 2016, Judge Terence W. Boyle of the United States
District Court for the Eastern District of North Carolina, Southern
Division, granted Bate Land & Timber's motion to dismiss the
appeals case captioned BATE LAND COMPANY, LP, Appellant, v. BATE
LAND & TIMBER, LLC, Appellee, Consolidated Case No. 7:16-CV-23-BO
(E.D.N.C.), as equitably moot. Subsequently, on September 13,
2016, Judge Boyle denied Bate Land Company, LP's emergency motion
for injunctive relief and for stay pending appeal to the court of
appeals the orders of the bankruptcy and district courts.
The bankruptcy court on February 3, 2016, entered its confirmation
order approving BLT's final Chapter 11 plan. Prior to entry of the
confirmation order, BLC had appealed four separate orders of the
bankruptcy court related to the Chapter 11 proceedings and plan
formation. Upon BLC's appeal of the final confirmation order, the
district court consolidated each of the five pending appeals.
On June 28, 2016, the district court denied BLC's motion to stay
the order of the bankruptcy court pending appeal, due to BLC's
unlikelihood of success on appeal. BLT moved to dismiss, arguing
that the appeal has been rendered equitably moot.
Judge Boyle granted BLT's motion, finding that BLC did not seek
review of the district court's denial of a stay in the court of
appeals, that BLT's reorganization plan has been substantially
consummated, and that the effect of a contrary finding at this
stage would plainly have a detrimental effect on the success of the
reorganization plan as well as on third parties.
BLC noticed its appeal of the district court's dismissal order on
September 9, 2016, and the same day filed a motion for emergency
injunctive relief and stay. BLC argued that emergency injunctive
relief and a stay is necessary to preserve its ability to obtain
meaningful review in the court of appeals.
BLC's emergency motion, however, failed to convince Judge Boyle
that his earlier ruling was in error or that circumstances have
changed such that a stay is warranted. The arguments proffered by
BLC in support of its motion to stay as they relate to the Judge
Boyle's order on equitable mootness are the same arguments which
the judge considered in deciding BLT's motion to dismiss. Judge
Boyle held that BLC has again not demonstrated a likelihood of
success on appeal. The judge also found that BLT will suffer harm
if prevented from both consummating what provisions remain of the
Chapter 11 reorganization plan and reentering the market as a
business.
A full-text copy of Judge Boyle's September 6, 2016 order is
available at http://tinyurl.com/jsvswclfrom Leagle.com.
A full-text copy of Judge Boyle's September 13, 2016 order is
available at http://tinyurl.com/jrefr7ufrom Leagle.com.
Bate Land Company, LP is represented by:
Joseph Z. Frost, Esq.
Laurie B. Biggs, Esq.
STUBBS & PERDUE, PA
9208 Falls of Neuse Road, Suite 201
Raleigh, NC 27615
Tel: (888)630-0074
Email: jfrost@stubbsperdue.com
lbiggs@stubbsperdue.com
-- and --
Matthew Nis Leerberg, Esq.
SMITH MOORE LEATHERWOOD LLP
434 Fayetteville Street, Suite 2800
Raleigh, NC 27601
Tel: (919)755-8700
Fax: (919)755-8800
Email: matt.leerberg@smithmoorelaw.com
-- and --
Trawick H. Stubbs, Jr., Esq.
STUBBS & PERDUE, PA
310 Craven St.
New Bern, NC 28560
Tel: (888)630-0074
Email: tstubbs@stubssperdue.com
Bate Land & Timber, LLC is represented by:
George Mason Oliver, Esq.
OLIVER FRIESEN CHEEK PLLC
405 Middle Street
New Bern, NC 28560
Tel: (252)633-1930
Email: george@olivercheek.com
-- and --
Mark R. Sigmon, Esq.
GRAEBE HANNA & SULLIVAN, PLLC
4350 Lassiter at North Hills Avenue, Suite 375
Raleigh, NC 27609
Tel: (919)863-9090
Fax: (919)863-9095
About Bate Land & Timber
Willotte, North Carolina-based Bate Land & Timber, LLC, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C.
Case No. 13-04665) on July 25, 2013. Judge Stephani W.
Humrickhouse oversees the Chapter 11 case.
The Debtor, in amended schedules, disclosed $53,477,624 in assets
and $74,162,211 liabilities as of the Chapter 11 filing. The
petition was signed by Brad Cheers, manager.
The Bankruptcy Administrator for the Eastern District of North
Carolina was unable to organize and recommend the appointment of a
committee of creditors holding unsecured claims against the Debtor.
BAY CIRCLE: Seeks Plan Exclusivity Extension Until November 4
-------------------------------------------------------------
Bay Circle Properties, LLC, DCT Systems Group, LLC, Sugarloaf
Centre, LLC, Nilhan Developers, LLC, and NRCT, LLC, ask the U.S.
Bankruptcy Court for the Northern District of Georgia to extend the
exclusive period for the Debtors to file their plans of
reorganization through Nov. 4, 2016.
By Orders entered Sept. 24, 2015, Dec. 8, 2015, March 14, 2016, and
May 13, 2016, the Court extended the exclusive period in which the
Debtors may file plans of reorganization through and including
Sept. 16, 2016, and extended the exclusive period to obtain
confirmation of the plans through and including Jan. 20, 2017.
The Debtors relate that on July 30, 2015, both Good Gateway, LLC
and SEG Gateway, LLC filed proofs of claim against all the Debtors
asserting secured claims for $2,500,000 and $12,000,000,
respectively, with no supporting documents and provided no basis
for the claim other than "Judgment". The claims asserted that they
were secured by real property and "other" which was described in
the claim as "#2010CA015315-O Orange County, FL." Accordingly, the
Debtors NRCT, Nilhan, DCT and Sugarloaf filed objections to the SEG
and Good claims.
The Debtors also relate that SEG and Good filed a motion for relief
from the automatic stay on Jan. 22, 2016, seeking leave to
liquidate the claims against all of the Debtors, where a hearing on
the Stay Motion was held Feb. 18, 2016 during which the Court
directed the parties to file briefs and continued the hearing to
May 12, 2016.
Consequently, at the May 12, 2016 hearing, the Court denied the
Stay Motion and set an "outside deadline" of 90 days for SEG and
Good to file an adversary proceeding in this Court; however, SEG
and Good failed to file an adversary proceeding on or before Aug.
10, 2016.
Due to the uncertainty surrounding SEG and Good's claims, the
Debtors have been unable to formulate a Plan of Reorganization by
September 16, 2016. Accordingly, the Debtors request a short
extension of the exclusive period for them to file their plans of
reorganization through November 4, 2016.
About Bay Circle Properties
Bay Circle Properties, LLC, DCT Systems Group, LLC, Sugarloaf
Centre, LLC, Nilhan Developers, LLC, and NRCT, LLC, own 16
different real properties including significant undeveloped
acreage. The properties also include office/warehouse buildings,
retail shopping centers and free standing single tenant buildings.
They filed Chapter 11 bankruptcy petitions (Bankr. N.D. Ga. Case
Nos. 15-58440 to 15-58444) on May 4, 2015. The Chapter 11 cases
are jointly administered. The petitions were signed by Chuck
Thakkar, manager. In its petition, Bay Circle estimated $1 million
to $10 million in both assets and liabilities. The Debtors are
represented by John A. Christy, Esq., J. Carole Thompson Hord,
Esq., and Jonathan A. Akins, Esq., at Schreeder, Wheeler & Flint,
LLP.
No trustee has been appointed and the Debtors are operating their
businesses as debtors-in-possession.
BEAZER HOMES: S&P Retains 'B-' Rating on Senior Unsecured Notes
---------------------------------------------------------------
S&P Global Ratings said it revised its recovery rating on Beazer
Homes USA Inc.'s senior unsecured notes to '3' from '4.' The '3'
recovery rating indicates S&P's expectation of meaningful (50% to
70%, lower end of range) recovery in the event of payment default.
The issue-level rating on the company's senior unsecured notes is
unchanged at 'B-', same as the corporate credit rating.
S&P revised the recovery rating because the company announced that
it intends to begin a tack-on offering of an additional
$100 million aggregate principal amount of its 8.75% senior notes
due 2022. The additional notes will be issued under the existing
indenture pursuant to which the company previously issued a
$400 million aggregate principal amount of its 8.75% senior notes
due 2022, all of which remain outstanding.
The net proceeds from the offering will be used to fund the
redemption of the company's 9.125% senior notes due 2019.
S&P's corporate credit rating on Beazer reflects S&P's view of the
company's business risk as vulnerable, due largely to S&P's view of
the sector's cyclical nature and the company's relatively small
platform compared with most public homebuilding peers. S&P assess
the company's financial risk as highly leveraged, because debt to
EBITDA was about 8x as of June 30, 2016.
RECOVERY ANALYSIS
Key analytical factors
-- The issue-level rating on the company's senior secured notes
is 'B+', (two notches higher than the 'B-' corporate credit
rating). The recovery rating is '1', indicating S&P's
expectation of very high (90% to 100%) recovery in the event
of payment default.
-- The issue-level rating on the company's senior unsecured
notes is 'B-', (same as the corporate credit rating). S&P
revised the recovery rating on the unsecured notes to '3'
from '4.' The '3' recovery rating indicates S&P's
expectation of meaningful (50% to 70%, lower end of range)
recovery in the event of payment default.
-- The recovery rating revision occurred as a result of the
company refinancing about $125 million of debt with about
$25 million of balance sheet cash and additional debt.
-- S&P estimates a gross recovery value of $825 million, which
assumes a blended 50% discount to the assumed $1.7 billion
in book value of inventory.
Simulated default and valuation assumptions
S&P's simulated default scenario contemplates a payment default in
2018. Under this scenario, a U.S. economic recession adversely
affects the volume of new home sales and drives average selling
prices back to trough levels, at which point liquidity is
constrained and the company cannot meet its fixed-charge
obligations.
Simplified waterfall
-- Gross recovery value: $825 million
-- Property level costs (5%): $41 million
-- Administrative costs (5%): $41 million
-- Net recovery value: $743 million
-- Priority claims (including outstanding letters of credit
outstanding): $16 million*
--------------------------------------------------------
-- Collateral available to secured claims: $727 million
-- Secured claims: $97 million*
-- Recovery expectations: 90% to 100%
-- Collateral available to unsecured creditors: $630 million
-- Senior unsecured debt claims: $1260 million*
-- Recovery expectations: 50% to 70% (lower half of the
range)
*Includes six months of accrued but unpaid interest.
Ratings List
Beazer Homes USA Inc.
Corporate Credit Rating B-/Stable/--
Rating Unchanged; Recovery Rating Revised
To From
Beazer Homes USA Inc.
Senior Unsecured B- B-
Recovery Rating 3L 4H
BENNU TITAN: Hearing on Bid for Ch.11 Trustee Moved to Nov. 1
-------------------------------------------------------------
A hearing on the Emergency Motion filed by filed by Beal Bank USA
and CLMG Corp. for an Order directing the appointment of a Chapter
11 Trustee for Bennu Titan LLC has been moved to Nov. 1, 2016 at
10:00 a.m. at US Bankruptcy Court, 824 Market St., 6th Fl.,
Courtroom #2, Wilmington, Delaware. Objections are due by Oct. 19,
2016.
Martin O'Sullivan, writing for Bankruptcy Law360, reported that a
Delaware bankruptcy judge has granted a bid by Bennu Titan LLC to
delay a hearing on the involuntary appointment of a Chapter 11
trustee, despite objections from a lender seeking $180 million.
The report noted that Beal Bank USA filed an involuntary Chapter 11
petition against Bennu Titan LLC in August, saying the company has
no cash to make payments on its debt because parent Bennu Oil & Gas
LLC had missed multiple monthly payments on an operating agreement
to run an offshore drilling platform.
The Alleged Debtor has filed a Motion to dismiss the Case.
An involuntary Chapter 11 bankruptcy petition was filed against
Houston, Texas-based offshore drilling firm Bennu Titan LLC, fka
ATP Titan LLC (Bankr. D. Del. Case No. 16-11870) on Aug. 11, 2016.
The petitioning creditors are Beal Bank USA, which is owed at least
$15,775 under a loan facility; and CLMG Corp., which is owed at
least $15,775 under a loan facility. The petitioning creditors are
represented by Michael J. Farnan, Esq., and Joseph J. Farnan, Esq.,
at Farnan LLP and Thomas E. Lauria, Esq., at White & Case LLP.
BIG GUYS PIZZERIA: Taps James Joyce as Legal Counsel
----------------------------------------------------
Big Guys Pizzeria and More, Inc. seeks approval from the U.S.
Bankruptcy Court for the Western District of New York to hire legal
counsel.
The Debtor proposes to hire James Joyce, Esq., to provide legal
services in connection with its Chapter 11 case. Mr. Joyce will be
compensated at the rate of $250 per hour.
In a court filing, Mr. Joyce disclosed that he is a "disinterested
person" as defined in section 101(14) of the Bankruptcy Code, and
does not hold or represent any interest adverse to the Debtor's
estate.
Mr. Joyce's contact information is:
James M. Joyce, Esq.
4733 Transit Road
Buffalo, NY 14043
Phone: (716) 656-0600
About Big Guys Pizzeria
Big Guys Pizzeria and More, Inc. sought protection under Chapter 11
of the Bankruptcy Code (Bankr. W.D.N.Y. Case No. 16-11735) on
September 6, 2016. The case is assigned to Judge Michael Kaplan.
BIOCLINICA HOLDING: S&P Assigns 'B-' CCR; Outlook Stable
--------------------------------------------------------
S&P Global Ratings assigned its 'B-' long-term corporate credit
rating to BioClinica Holding I L.P. The outlook is stable.
S&P assigned its 'B' issue ratings to the first-lien term loan and
revolving credit facility. The debt is issued by a co-borrower
group of BioClinica-Synowledge Holdings Corp., BioClinica-eClinical
Holdings LLC, BioClinica Synarc Corp., and BioClinica Clinverse
Corp. The recovery rating is '2' reflecting S&P's expectations for
substantial (70%-90%; the lower half of the range) recovery in the
event of a default.
At the same time, S&P assigned its 'CCC' issue rating to the same
co-borrower group's second-lien term loan. The recovery rating is
'6', reflecting S&P's expectation for negligible (0%-10%) recovery
in the event of a default.
At the close of the transaction, S&P expects to withdraw its 'B-'
corporate credit rating on Synarc-Biocore Holdings LLC (the issuer
of debt under the current capital structure) as well as the issue
level ratings on this entity's debt, as it will be redeemed.
"Our 'B-' corporate credit rating with a stable outlook on
BioClinica reflects our expectation that the company will operate
with debt leverage of about 8x at the close of the transaction,"
said S&P Global Ratings credit analyst Matthew Todd.
S&P believes that leverage is likely to remain high, despite the
potential for EBITDA growth, because S&P expects the company would
prioritize acquisitions, particularly in the imaging space, over
deleveraging. S&P expects BioClinica to generate positive free
cash flow in the long term as a result of high growth in its
eClinical and global clinical research segments. Although S&P
expects the company to pursue an aggressive growth strategy
supported by Cinven, the new financial sponsor, S&P do not expect
the new financial sponsor to extract a debt-funded dividend in the
next year due to the already high leverage.
The rating outlook is stable despite likely revenue growth in the
30% area over the next 12 months and adjusted EBITDA margins that
S&P expects will expand to the mid- to high-20% area. The company
has a limited track record as a combined company, and S&P believes
that the new financial sponsor will operate the company with high
leverage.
S&P could consider lowering the rating if it expects BioClinica to
experience persistent cash flow deficits. This could result from a
relatively modest deterioration in operations, given the company's
high leverage. This scenario could unfold if the company
experiences slow commercial uptake of its new software products,
especially the pharmacovigilance and financial services, or delays
in its multiple imaging and/or trial site studies. S&P believes
that the company will not be able to cover its interest and
maintenance capital expenditures if it grows revenue only to the
mid- to high-single-digit area in 2017 and adjusted EBITDA margins
are in the low-20% area.
S&P could consider raising the rating if the company exceeds S&P's
expectations for growth in both the eClinical and global clinical
research segments. This could occur if, for the year 2017, S&P
expects the company to grow organically in the low-20% area and
report EBITDA margins near 30%, which would be consistent with
soundly positive cash flows and leverage below 7x. In addition,
S&P would need to be confident that the company would sustain
leverage at those levels.
BLUE WAVE TECH: Court Affirms $8K Fee Awarded to Caribbean Tower
----------------------------------------------------------------
In the case captioned BLUE WAVE TECH CORP., et al. Appellants, v.
CARIBBEAN TOWER SITES, LLC, Appellee, Civil No. 15-1312 (PAD),
Judge Pedro A. Delgado-Hernandez of the United States District
Court for the District of Puerto Rico affirmed the orders issued by
the bankruptcy court requiring Appellants Blue Wave Tech Corp. and
its president, Brian Safreed, to pay for the attorney's fees
incurred by appellee, Caribbean Tower Sites, LLC, in securing the
appellants' compliance with previous court orders and discovery
obligations.
The Appellee filed a "Motion for the Reimbursement of Expenses and
Attorney's Fees Incurred in Connection with the Continuation of
Discovery and the Rescheduling of Depositions," detailing the
additional expenses incurred by the appellee's president, John
Campbell, for hotel accommodations, transportation and meals due to
the rescheduling of the depositions (totaling $1,480.00) and
requesting reimbursement of $8,330.00 in reasonable attorney's fees
incurred in procuring compliance with the discovery schedule.
The Appellants, however, opposed the appellee's motion. The
Appellee replied, submitting a redacted copy of the invoice
submitted by its attorneys, evidencing the time devoted to procure
the appellant's compliance with the discovery schedule, and copy of
the receipts for Mr. Campbell's hotel accommodations,
transportation and meals, which had not been available at the time
the original request for attorneys' fees was filed. The Appellants
sur-replied.
The bankruptcy court authorized the reimbursement of $7,630 in
attorney's fees and $404 in airfare expenses to be paid by
Appellant to Appellee. Appellants unsuccessfully moved for
reconsideration, and this appeal followed.
Judge Delgado-Hernandez held that the contention that the court
ordered reimbursement of attorney's fees relying on ex parte
information not available to the appellants lacks merit. They were
privy to what appellee requested and the factual grounds for the
request, the judge said. Albeit not making a specific finding
regarding "vexatious" behavior, it is clear the court acted within
its discretion in imposing attorney's fees on appellants for the
time reasonably incurred by appellee in securing appellants'
compliance with previous court orders and corresponding discovery
obligations, the judge added. The record shows no abuse of
discretion, and appellants have demonstrated none, the judge
pointed out.
A full-text copy of the Memorandum and Order dated September 19,
2016 is available at https://is.gd/FktjMe from Leagle.com.
Blue Wave Tech Corp., Appellant, is represented by Nelson
Robles-Diaz, Esq. -- Nelson Robles-Diaz Law Offices P.S.C..
Brian Safreed, Appellant, is represented by Jesus R.
Morales-Cordero, Esq. -- Morales Cordero, CSP & Nelson Robles-Diaz,
Nelson Robles-Diaz Law Offices P.S.C..
Carribean Tower Sites, LLC, Appellee, is represented by Miguel J.
Rodriguez-Marxuach, Esq. -- Rodriguez Marxuach, P.S.C..
US Trustee, Interested Party, is represented by Monsita
Lecaroz-Arribas, U. S. Trustee Office.
BONANZA CREEK: At Risk of Credit Squeeze After Overdrawing Revolver
-------------------------------------------------------------------
Harvard Zhang, writing for Bloomberg Brief, reported that Bonanza
Creek Energy and six other small oil and gas drillers are at risk
of being squeezed by their lenders in October after reaching or
exceeding limits on their revolving credit lines.
According to the report, citing Spencer Cutter, a distressed-
energy-company analyst at Bloomberg Intelligence, during twice
yearly redetermination periods, banks typically review their
lending to energy companies and smaller companies may be affected
more by a reduction in their borrowing base because they have fewer
assets to sell and less spare collateral to pledge, and they
extract fuel from less- economic basins.
"The borrowing-base redetermination may continue to cull the weak
companies out of the herd," Mr. Cutter said, the report related.
The report pointed out that Bonanza Creek has overdrawn its $200
million revolver by $43.9 million, and Vanguard exceeded its $1.33
billion line by almost $70 million, according to a Sept. 21 report
by Cutter that relied on figures, some in corporate filings, from
June to August.
Bonanza Creek and Vanguard Natural Resources, the gas company's
parent, both have recorded seven straight quarters of losses, the
report also pointed out, citing Bloomberg data.
"Banks are probably looking at these companies with their borrowing
capacity upside down as a workout situation," Thomas Watters,
managing director of oil and gas team at S&P Global Ratings, told
the news agency in a Sept. 23 phone interview.
The other drillers that have used all their borrowing capacity are
Gastar Exploration, Alta Mesa Holdings, Rex Energy, Stone Energy
and Mid-Con Energy Properties.
* * *
The Troubled Company Reporter, on Sept. 13, 2016, reported that S&P
Global Ratings raised its corporate credit rating on U.S.-based oil
and gas exploration and production company Bonanza Creek Energy
Inc. to 'CC' from 'D'. The rating outlook is negative.
At the same time, S&P raised its issue-level rating on the
company's senior unsecured debt to 'CC' from 'D'. The recovery
rating is unchanged at '6', indicating S&P's expectation for
negligible (0%-10%) recovery of principal in the event of a
payment
default.
The TCR, on Sept. 1, 2016, also reported that Bonanza Creek has
been notified by The New York Stock Exchange that it is no longer
in compliance with certain continued listing standards that are
applicable to the Company. The Company's 30-day average closing
share price as of Aug. 22, 2016, was $0.98, in violation of the
listing standard set forth in Section 802.01C of the NYSE Listed
Company Manual, requiring the trailing 30-day average closing share
price to remain above $1.00.
BRIDGET BRASFIELD: Disclosures Ok'd, Plan Hearing on Nov. 15
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Illinois
will consider approval of the Chapter 11 plan of Bridget Ellen
Brasfield at a hearing on November 15.
The hearing will be held at 9:00 a.m., at Melvin Price US
Courthouse, 750 Missouri Avenue, East St. Louis, Illinois.
The court had earlier approved the Debtor's disclosure statement,
allowing her to start soliciting votes from creditors.
The September 20 order required creditors to cast their votes and
file their objections to the plan on or before seven days prior to
the date of hearing.
About Bridget Ellen Brasfield
Bridget Ellen Brasfield is licensed as a Chiropractor, and
initially was self-employed and working with her former husband as
a Chiropractor and Weight Loss consultant. She established the
Advanced Medical Weight Loss business in August 2014. She also
operated for a short period of time Yoga Central, a yoga exercise
studio. The exercise studio had no positive cash flow, and closed
in February of 2015. All of the businesses operated at a loss in
2014, but Advanced, after the initial start up costs, is operating
at a sufficient profit to afford the Debtor wages with which to
cover her personal expenses and make payments to her creditors.
Ms. Brasfield has been a Chapter 11 Debtor (Bankr. S.D. Ill. Case
No. 15-30112) since May 2015. The case started as a Chapter 13
proceeding.
The Hon. Laura K. Grandy presides over the case.
Ms. Brasfield is represented by:
Rochelle D. Stanton, Esq.
745 Old Frontenac Square, Suite 202
Frontenac, MO 63131
Tel: 314-991-1559
CABLE & WIRELESS: Moody's Lowers CFR to Ba3; Outlook Stable
-----------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating of
Cable & Wireless Communications Limited (CWC) to Ba3 from Ba2. At
the same time, Moody's downgraded the senior secured ratings of
Sable International Finance Limited (SIFL) to Ba3 from (P)Ba2 and
CWC's probability of default rating to Ba3-PD from Ba2-PD. Moody's
also affirmed the Ba3 senior unsecured ratings of SIFL and Columbus
International Inc and downgraded the senior unsecured rating of
Cable & Wireless International Finance B.V. ("CWIF") to B2 from B1.
The outlook on all the ratings was changed to stable, from
negative.
These rating actions were taken:
Downgrades:
Issuer: Cable & Wireless Communications Limited
Probability of Default Rating, Downgraded to Ba3-PD from Ba2-PD
Corporate Family Rating, Downgraded to Ba3 from Ba2
Issuer: Cable & Wireless International Finance B.V.
Senior Unsecured Regular Bond/Debenture, Downgraded to B2 from
B1
Issuer: Sable International Finance Limited
Senior Secured Bank Credit Facility, Downgraded to Ba3 from
(P)Ba2
Outlook Actions:
Issuer: Cable & Wireless Communications Limited
Outlook, Changed To Stable From Negative
Issuer: Cable & Wireless International Finance B.V.
Outlook, Changed To Stable From Negative
Issuer: Columbus International Inc.
Outlook, Changed To Stable From Negative
Issuer: Sable International Finance Limited
Outlook, Changed To Stable From Negative
Affirmations:
Issuer: Columbus International Inc.
Senior Unsecured Regular Bond/Debenture, Affirmed Ba3
Issuer: Sable International Finance Limited
Senior Unsecured Regular Bond/Debenture, Affirmed Ba3
RATINGS RATIONALE
The downgrade of CWC's CFR is a reflection of the credit profile
and financial policies of its parent company, Liberty Global (Ba3,
stable), which acquired the company in May 2016. Under the new
management, CWC's Ba3 CFR incorporates Moody's expectations for a
weaker credit profile due to higher leverage and lower coverage
metrics on a sustained basis. Despite the uplift in CWC's EBITDA
generation and consolidated margins following the acquisition of
Columbus International in March 2015 and the ongoing potential for
additional synergies as part of the Liberty Global group, the
deleveraging process has been slowed by the higher debt burden
placed on CWC as part of its acquisition by Liberty Global.
As of the fiscal year ended March 2016, CWC's adjusted EBITDA
margin increased to 40%, reflecting the integration of Columbus's
higher margin operation as well operational synergies. However,
CWC's higher debt balance resulted in consolidated gross leverage
at 3.6 times as of March 2016, as adjusted by Moody's, and we
forecast that adjusted consolidated gross leverage will remain
elevated at around 3.8 times through March 2018. Upon acquiring
Columbus, Moody's originally expected to see a deleveraging trend
following the Columbus acquisition leading to under 3.0 times
during the same period.
CWC's Ba3 CFR also reflects the company's effective business model,
increasing profitability and leading market positions throughout
the Caribbean and Panama. The rating incorporates operating
challenges and exposure to the emerging economies where the company
operates as well as the competitive nature of the telecom industry.
Despite a higher debt burden, CWC's integration into the Liberty
Global group brings some benefits as it forms part of a larger,
well-funded group and will likely be able to capture synergies in
areas such as revenue, content, procurement, administration and
product development due to economies of scale.
The alignment of the unsecured ratings of Columbus and secured and
unsecured ratings of SIFL to CWC's Ba3 CFR reflects our assessment
that with the exception of the unsecured debt at CWIF, there is no
structural subordination or security that merits differentiation
from the CFR. The CWIF bonds are rated two notches below Columbus
and SIFL at B2 because they benefit only from a structurally
subordinated guarantee and have access to CWC cash flows only after
SIFL, ranking last in the priority of claims.
The stable outlook on CWC's ratings reflects expectations for
adjusted EBITDA margins remaining above 40%, moderate revenue
growth and an adequate liquidity position. The outlook also
incorporates gross consolidated leverage, as adjusted by Moody's,
remaining slightly under 4.0 times and negative to flat free cash
flow through 2018.
CWC's ratings could be downgraded if gross consolidated leverage,
as adjusted by Moody's, increases to over 4.0 times or if adjusted
EBITDA margins decline toward 35%, both on a sustained basis. If
the company's market shares decline or its liquidity position
weakens, the ratings would also come under pressure. CWC's ratings
could also be downgraded if Liberty Global's ratings are
downgraded.
A ratings upgrade is unlikely at this time given CWC's linkage to
Liberty Global's credit profile. However, a ratings upgrade could
be considered if more conservative financial policies lead to
deleveraging to under 2.5 times while maintaining stable EBITDA
margins and generating strong positive free cash flow. If Liberty
Global's ratings are upgraded, CWC's ratings could also be
upgraded.
The principal methodology used in these ratings was Global
Telecommunications Industry published in December 2010.
CAESARS ENTERTAINMENT: Hilton Hit with $4.7M ERISA Suit
-------------------------------------------------------
Carmen Castro-Pagan, writing for Bloomberg News, reported that a
group of current and former Hilton Hotels Corp. executives accuse
the hotel giant of failing to pay $4.7 million in retirement
benefits it allegedly owes as part of its relationship with Caesars
Entertainment Corp. ( Boyle v. Hilton Hotels Corp. , D. Nev., No.
2:16-cv-02250, complaint filed 9/26/16 ).
According to the report, the lawsuit, filed Sept. 26, 2016, in the
U.S. District Court for the District of Nevada, brings attention to
the 1998 spin-off of Hilton's gaming division -- formerly known as
Park Place Entertainment Corp. -- which later changed its name to
Caesars. After Caesars filed for bankruptcy last year, Hilton sued
the gaming company for its alleged failure to pay at least $17.7
million in contributions to a pension fund for former Hilton
employees, the report related. The case was settled this summer in
the bankruptcy court, the report said.
As part of the 1998 spin off, Hilton unilaterally allocated to
Caesars certain liabilities, including its pension obligations
related to the executives, Bloomberg further related, citing the
complaint. The executives, who were and continue to be
participants in Hilton's deferred compensation plans for highly
compensated individuals, allege that the hotel company is liable
for their benefits because it was never released from its
contractual obligation under the plans, the complaint said, the
report added.
The Bourassa Law Group, LLC represents the executives.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.,
is one of the world's largest casino companies. Caesars casino
resorts operate under the Caesars, Bally's, Flamingo, Grand
Casinos, Hilton and Paris brand names. The Company has its
corporate headquarters in Las Vegas. Harrah's announced its
re-branding to Caesar's in mid-November 2010.
In January 2015, Caesars Entertainment and subsidiary Caesars
Entertainment Operating Company, Inc., announced that holders of
more than 60% of claims in respect of CEOC's 11.25% senior secured
notes due 2017, CEOC's 8.5% senior secured notes due 2020 and
CEOC's 9% senior secured notes due 2020 have signed the Amended
and
Restated Restructuring Support and Forbearance Agreement, dated as
of Dec. 31, 2014, among Caesars Entertainment, CEOC and the
Consenting Creditors. As a result, The RSA became effective
pursuant to its terms as of Jan. 9, 2015.
Appaloosa Investment Limited, et al., owed $41 million on account
of 10% second lien notes in the company, filed an involuntary
Chapter 11 bankruptcy petition against CEOC (Bankr. D. Del. Case
No.
15-10047) on Jan. 12, 2015. The bondholders are represented by
Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP.
CEOC and 172 other affiliates -- operators of 38 gaming and resort
properties in 14 U.S. states and 5 countries -- filed Chapter 11
bankruptcy petitions (Bank. N.D. Ill. Lead Case No. 15-01145) on
Jan. 15, 2015. CEOC disclosed total assets of $12.3 billion and
total debt of $19.8 billion as of Sept. 30, 2014.
Delaware Bankruptcy Judge Kevin Gross entered a ruling that the
bankruptcy proceedings will proceed in the U.S. Bankruptcy Court
for the Northern District of Illinois.
Kirkland & Ellis serves as the Debtors' counsel. AlixPartners is
the Debtors' restructuring advisors. Prime Clerk LLC acts as the
Debtors' notice and claims agent. Judge Benjamin Goldgar presides
over the cases.
The U.S. Trustee has appointed seven noteholders to serve in the
Official Committee of Second Priority Noteholders and nine members
to serve in the Official Unsecured Creditors' Committee.
The U.S. Trustee appointed Richard S. Davis as Chapter 11
examiner.
* * *
The U.S. Bankruptcy Court for the Northern District of Illinois
approved the adequacy of the disclosure statement explaining the
second amended joint Chapter 11 plan of reorganization of Caesars
Entertainment Operating Company Inc. and its debtor-affiliates.
The Court set Oct. 31, 2016, at 4:00 p.m. (prevailing Central
Time)
as last day for any holder of a claim entitle to vote to accept or
reject the Debtors' plan.
A hearing is set for Jan. 17, 2017, at 10:30 a.m. (prevailing
Central Time) in Courtroom No. 642 in the Everett McKinley Dirksen
United States Courthouse, 219 South Dearborn Street, Chicago,
Illinois, to confirm the Debtors' plan. Objections to
confirmation, if any, are due Oct. 31, 2016, at 4:00 p.m.
(prevailing Central Time).
CAESARS ENTERTAINMENT: Provides Report on Revised Plan Term Sheet
-----------------------------------------------------------------
Caesars Entertainment Operating Company, Inc., and its Chapter 11
debtor subsidiaries on Sept. 28, 2016, provided the Bankruptcy
Court with a report on the term sheet that has been proposed to
provide the basis for a revised plan of reorganization for the
Debtors (the "Revised Plan of Reorganization").
Caesars Entertainment Corporation ("Caesars Entertainment") and
representatives of most of CEOC's major creditor groups have
confirmed their support for the term sheet. The term sheet
provides that the parties will negotiate definitive support
agreements and the Revised Plan of Reorganization in good faith
through the close of business on Sept. 30, a process which could
extend beyond such date. CEOC reported that the parties are
working diligently on those documents, and advised the Bankruptcy
Court that a further hearing may be necessary to address whether
any proposed adjustments to the plan confirmation timetable are
warranted if the definitive support agreements are agreed to and
executed and the Revised Plan of Reorganization is agreed to and
filed.
Also on Sept. 28, the Bankruptcy Court scheduled a hearing for Oct.
4 to consider a request that the Debtors intend to make for a stay
of certain litigation pending against Caesars Entertainment. That
litigation is presently stayed through Oct. 5. Assuming a Revised
Plan of Reorganization is agreed upon and definitive support
agreements are entered into, it is expected that most of CEOC's
major creditor groups will support the anticipated stay request.
In addition, an appeal of the Bankruptcy Court's previous denial of
a requested stay of such litigation is scheduled for argument on
Oct. 5 in the United States District Court for the Northern
District of Illinois. If the Bankruptcy Court does not grant
CEOC's request for a stay on Oct. 4, and subsequently, CEOC is
unsuccessful in its appeal on Oct. 5, such litigation would resume.
Summary judgment hearings in such litigation are scheduled in
United States District Court for the Southern District of New York
on Oct. 6, and in Delaware Chancery Court on Oct. 7. Further
information regarding such litigation can be found in Caesars
Entertainment's SEC filings.
The Revised Plan of Reorganization, if agreed and filed with the
Bankruptcy Court, will be subject to a formal creditor vote and
confirmation by the Bankruptcy Court. The completion of CEOC's
restructuring under the Revised Plan of Reorganization will be
subject to numerous conditions, including regulatory approval,
completion of definitive documentation implementing the Revised
Plan of Reorganization and consummation of the merger between
Caesars Entertainment and Caesars Acquisition Company.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.,
is one of the world's largest casino companies. Caesars casino
resorts operate under the Caesars, Bally's, Flamingo, Grand
Casinos, Hilton and Paris brand names. The Company has its
corporate headquarters in Las Vegas. Harrah's announced its
re-branding to Caesar's in mid-November 2010.
In January 2015, Caesars Entertainment and subsidiary Caesars
Entertainment Operating Company, Inc., announced that holders of
more than 60% of claims in respect of CEOC's 11.25% senior secured
notes due 2017, CEOC's 8.5% senior secured notes due 2020 and
CEOC's 9% senior secured notes due 2020 have signed the Amended and
Restated Restructuring Support and Forbearance Agreement, dated as
of Dec. 31, 2014, among Caesars Entertainment, CEOC and the
Consenting Creditors. As a result, The RSA became effective
pursuant to its terms as of Jan. 9, 2015.
Appaloosa Investment Limited, et al., owed $41 million on account
of 10% second lien notes in the company, filed an involuntary
Chapter 11 bankruptcy petition against CEOC (Bankr. D. Del. Case
No. 15-10047) on Jan. 12, 2015. The bondholders are represented
by Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor
LLP.
CEOC and 172 other affiliates -- operators of 38 gaming and resort
properties in 14 U.S. states and 5 countries -- filed Chapter 11
bankruptcy petitions (Bank. N.D. Ill. Lead Case No. 15-01145) on
Jan. 15, 2015. CEOC disclosed total assets of $12.3 billion and
total debt of $19.8 billion as of Sept. 30, 2014.
Delaware Bankruptcy Judge Kevin Gross entered a ruling that the
bankruptcy proceedings will proceed in the U.S. Bankruptcy Court
for the Northern District of Illinois.
Kirkland & Ellis serves as the Debtors' counsel. AlixPartners is
the Debtors' restructuring advisors. Prime Clerk LLC acts as the
Debtors' notice and claims agent. Judge Benjamin Goldgar presides
over the cases.
The U.S. Trustee has appointed seven noteholders to serve in the
Official Committee of Second Priority Noteholders and nine members
to serve in the Official Unsecured Creditors' Committee.
The U.S. Trustee appointed Richard S. Davis as Chapter 11
examiner.
* * *
The U.S. Bankruptcy Court for the Northern District of Illinois
approved the adequacy of the disclosure statement explaining the
second amended joint Chapter 11 plan of reorganization of Caesars
Entertainment Operating Company Inc. and its debtor-affiliates.
The Court set Oct. 31, 2016, at 4:00 p.m. (prevailing Central Time)
as last day for any holder of a claim entitle to vote to accept or
reject the Debtors' plan.
A hearing is set for Jan. 17, 2017, at 10:30 a.m. (prevailing
Central Time) in Courtroom No. 642 in the Everett McKinley Dirksen
United States Courthouse, 219 South Dearborn Street, Chicago,
Illinois, to confirm the Debtors' plan. Objections to
confirmation, if any, are due Oct. 31, 2016, at 4:00 p.m.
(prevailing Central Time).
CAESARS ENTERTAINMENT: To Emerge From Ch. 11 Bankruptcy
-------------------------------------------------------
Michael J. de la Merced, writing for The New York Times' DealBook,
reported that an agreement between Apollo Global Management, TPG
Capital and other private equity firms and Caesars Entertainment
resolves the long-running battle between the two parties, which
allows the bankrupt operating company to emerge from Chapter 11
bankruptcy.
According to the report, under the terms of the deal, Apollo and
TPG will hand over their $950 million stake in Caesars
Entertainment's parent company, which is publicly traded and not in
bankruptcy protection. They will retain a smaller stake in Caesars
Entertainment through their holdings in another affiliate, the
report noted. More senior creditors will also give up some of what
they are owed, the report said.
Over all, creditors will own 70 percent of Caesars when it emerges
from Chapter 11 protection, the report related. Shareholders in
the still-public parent company will own 6 percent in the newly
reorganized company, the report added.
According to the DealBook, Apollo and TPG were forced to concede
ground to stave off a potentially more disastrous defeat during
adverse legal decisions in the bankruptcy case.
About Caesars Entertainment
Caesars Entertainment Corp., formerly Harrah's Entertainment Inc.,
is one of the world's largest casino companies. Caesars casino
resorts operate under the Caesars, Bally's, Flamingo, Grand
Casinos, Hilton and Paris brand names. The Company has its
corporate headquarters in Las Vegas. Harrah's announced its
re-branding to Caesar's in mid-November 2010.
In January 2015, Caesars Entertainment and subsidiary Caesars
Entertainment Operating Company, Inc., announced that holders of
more than 60% of claims in respect of CEOC's 11.25% senior secured
notes due 2017, CEOC's 8.5% senior secured notes due 2020 and
CEOC's 9% senior secured notes due 2020 have signed the Amended
and
Restated Restructuring Support and Forbearance Agreement, dated as
of Dec. 31, 2014, among Caesars Entertainment, CEOC and the
Consenting Creditors. As a result, The RSA became effective
pursuant to its terms as of Jan. 9, 2015.
Appaloosa Investment Limited, et al., owed $41 million on account
of 10% second lien notes in the company, filed an involuntary
Chapter 11 bankruptcy petition against CEOC (Bankr. D. Del. Case
No.
15-10047) on Jan. 12, 2015. The bondholders are represented by
Robert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor LLP.
CEOC and 172 other affiliates -- operators of 38 gaming and resort
properties in 14 U.S. states and 5 countries -- filed Chapter 11
bankruptcy petitions (Bank. N.D. Ill. Lead Case No. 15-01145) on
Jan. 15, 2015. CEOC disclosed total assets of $12.3 billion and
total debt of $19.8 billion as of Sept. 30, 2014.
Delaware Bankruptcy Judge Kevin Gross entered a ruling that the
bankruptcy proceedings will proceed in the U.S. Bankruptcy Court
for the Northern District of Illinois.
Kirkland & Ellis serves as the Debtors' counsel. AlixPartners is
the Debtors' restructuring advisors. Prime Clerk LLC acts as the
Debtors' notice and claims agent. Judge Benjamin Goldgar presides
over the cases.
The U.S. Trustee has appointed seven noteholders to serve in the
Official Committee of Second Priority Noteholders and nine members
to serve in the Official Unsecured Creditors' Committee.
The U.S. Trustee appointed Richard S. Davis as Chapter 11
examiner.
* * *
The U.S. Bankruptcy Court for the Northern District of Illinois
approved the adequacy of the disclosure statement explaining the
second amended joint Chapter 11 plan of reorganization of Caesars
Entertainment Operating Company Inc. and its debtor-affiliates.
The Court set Oct. 31, 2016, at 4:00 p.m. (prevailing Central
Time)
as last day for any holder of a claim entitle to vote to accept or
reject the Debtors' plan.
A hearing is set for Jan. 17, 2017, at 10:30 a.m. (prevailing
Central Time) in Courtroom No. 642 in the Everett McKinley Dirksen
United States Courthouse, 219 South Dearborn Street, Chicago,
Illinois, to confirm the Debtors' plan. Objections to
confirmation, if any, are due Oct. 31, 2016, at 4:00 p.m.
(prevailing Central Time).
CARIBBEAN TRANSPORT: Taps Rivera & Fernandez as Special Counsel
---------------------------------------------------------------
Caribbean Transport Refrigeration & Power Systems, Inc. seeks
approval from the U.S. Bankruptcy Court for the District of Puerto
Rico to hire Rivera & Fernandez as special counsel.
The firm will represent the Debtor in matters related to the
possible claims for fraud, breach of contract and damages in
connection with the foreclosure of a commercial mortgage loan
issued by Firstbank Puerto Rico, Inc.
The firm's professionals and their hourly rates are:
Partners $185
Associates $150
Paralegals $95
Edgardo Rivera Rivera, Esq., disclosed in a court filing that his
firm is a "disinterested person" as defined in section 101(14) of
the Bankruptcy Code.
The firm can be reached through:
Edgardo L. Rivera Rivera, Esq.
Rivera & Fernandez
Galeria San Patricio, Suite 205
P.O. Box 360764
San Juan, PR 00936-0764
Tel: 787-281-0707
Fax: 787-281-0708
Email: erivera@rflawpr.com
About Caribbean Transport
Caribbean Transport Refrigeration & Power Systems Inc., based in
Morovis, PR, filed a Chapter 11 petition (Bankr. D.P.R. Case No.
16-06766) on August 25, 2016. Teresa M. Lube Capo, Esq., at Lube &
Soto Law Offices, PSC, serves as bankruptcy counsel.
In its petition, the Debtor estimated $0 to $50,000 in assets and
$1 million to $10 million in liabilities. The petition was signed
by Isidro Ojeda, president.
No official committee of unsecured creditors has been appointed in
the case.
CBS RADIO: Moody's Assigns B1 Corporate Family Rating
-----------------------------------------------------
Moody's Investors Service assigned CBS Radio Inc. a B1 corporate
family rating (CFR) and assigned a Ba3 rating to the proposed $1.25
billion first lien credit facility consisting of a $250 million
five year revolver and a $1 billion seven year term loan B. The
proposed $460 million senior notes are rated B3. The outlook is
stable.
The proceeds from the transaction will be distributed to CBS
Corporation as part of the split off of CBS Radio from the parent
company in addition to adding cash to the balance sheet and paying
transaction fees. Moody's said, “We expect the company to pursue
an IPO and begin operating as a standalone company in early
2017.”
A summary of Moody's rating action is as follows:
CBS Radio Inc.
-- Corporate Family Rating B1
-- Probability of Default Rating B1-PD
-- New $250 million revolver due 2021 assigned a Ba3 (LGD3)
-- New $1 billion term loan B due 2023 assigned a Ba3 (LGD3)
-- New $460 million senior notes due 2024 assigned a B3 (LGD5)
-- SGL-2 assigned
-- Outlook: stable
The assigned ratings are subject to review of final documentation
and no material change in the terms and conditions of the
transaction as provided to Moody's.
RATINGS RATIONALE
CBS Radio's B1 CFR reflects the company's position as the second
largest radio broadcaster in the US with leading market positions
in 19 of the top 25 markets. The company benefits from a
geographically diversified footprint with strong market clusters in
most of the areas it operates which enhances its competitive
position. A diversified format offering of music, news, and sports
are also positives to the rating. Leverage pro-forma for the
transaction is 4.8x as of Q2 2016 including Moody's standard lease
adjustments. Modest amounts of capital expenditures are expected to
lead to good free cash flow. The rating also reflects the secular
pressure in the radio industry with an increasing number of digital
music offerings and advertising alternatives as well as the
cyclicality of the industry. In the near term, the company will
focus on building its corporate operations as it begins operating
as an independent company which slightly elevates operational risk
until its operations are established. Revenue and EBITDA
performance was weak in 2015 as revenue declined almost 6% and
costs increased, but a restructuring plan implemented following a
change in management last year has led to reduced expenses. Revenue
declines moderated in the first half of 2016 compared to the prior
year period, but still declined by 2%. The second half of the 2016
should benefit modestly from political ad spending. Moody's said,
“We expect the company to focus on expanding its digital and
event revenues which comprised 19% of revenue in 2015.” Asset
swaps or acquisitions of radio assets that strengthen its
competitive position are also possible.
Liquidity is expected to be good as reflected in our speculative
grade liquidity rating of SGL-2. The company will benefit from a
$250 million revolver due in 2021 which is expected to be undrawn
and a cash balance of approximately $10 million at closing. CBS
Radio is anticipated to pay an annual dividend to shareholders,
with remaining free cash flow available for debt repayment or
acquisitions. The revolver is expected to be subject to a net
secured leverage ratio of 4x (up to 4.5x one year after permitted
acquisitions) as calculated by the credit agreement. The term loan
is expected to be covenant lite.
The outlook is stable and reflects our expectation for flat to
slightly negative growth through 2017. Free cash flow after
projected dividends are expected to be used for debt payment or
acquisitions which should support modest deleveraging over the
rating horizon.
The rating could be upgraded if leverage declined below 3.75x
(including Moody's standard adjustments) with a good liquidity
profile and a high single digit percentage of free cash flow to
debt ratio. Positive revenue growth and stable EBITDA margins would
also be required in addition to confidence that management would
maintain financial policies (including dividends, share
repurchases, and acquisitions) that were consistent with a higher
rating level.
The rating could be downgraded if leverage increased above 5.25x
due to underperformance, audience and advertising revenue migration
to competing media platforms, or leveraging events such as debt
financed acquisitions or shareholder distributions. A reduction in
free cash flow to debt ratio (after dividends) well below 5% or a
weakened liquidity profile could also lead to negative rating
pressure.
The principal methodology used in these ratings was Global
Broadcast and Advertising Related Industries published in May 2012.
CBS Radio Inc. is currently an operating subsidiary of CBS
Corporation which is planning to split off the division following a
planned IPO in early 2017. The company is the second largest radio
operator in the US based on revenue and operates in 26 radio
markets and 19 of the top 25 markets. LTM revenue as of Q2 2016 is
approximately $1.2 billion.
CBS RADIO: S&P Assigns 'B+' CCR & Rates $250MM Facility 'BB-'
-------------------------------------------------------------
S&P Global Ratings said that it assigned its 'B+' corporate credit
rating to New York-based radio broadcaster CBS Radio Inc. The
rating outlook is stable.
At the same time, S&P assigned its 'BB-' issue-level rating and '2'
recovery rating to CBS Radio's proposed $250 million revolving
credit facility due 2021 and $1 billion term loan due 2023. The
'2' recovery rating indicates S&P's expectation for substantial
(70%-90%; upper half of the range) recovery of principal for
lenders in the event of a payment default.
S&P also assigned its 'B-' issue-level rating and '6' recovery
rating to the company's proposed $460 million senior notes due
2024. The '6' recovery rating indicates S&P's expectation for
minimal (0%-10%) recovery of principal for lenders in the event of
a payment default.
"Our 'B+' corporate credit rating reflects CBS Radio's critical
mass as one of the largest U.S. radio broadcasters and its
favorable large market presence, which is tempered by its lack of
meaningful diversification outside radio broadcasting and the
secular pressures affecting radio advertising," said S&P Global
Ratings' credit analyst Jeanne Shoesmith. "We believe the
company's adjusted leverage will remain above 4x for the next 12-18
months, reflecting elevated debt in the capital structure following
the company's proposed debt-financed dividend and separation from
CBS Corp. and minimal leverage reduction."
The stable rating outlook reflects S&P's expectation that CBS Radio
will maintain adjusted leverage in the low-4x area over the next
one to two years.
S&P views an upgrade as more likely than a downgrade over the next
one to two years. S&P could raise the rating if the company
reduces leverage to about 4x. S&P could also raise the rating if
the company meaningfully diversifies its business, if it expands
its EBITDA margins, or if the radio industry returns to some modest
pace of sustainable growth.
S&P could consider a downgrade if deterioration in operating
performance or integration issues causes the company's deleveraging
to stall, with leverage increasing to 5x.
CCH JOHN EAGAN: Court Moves Solicitation Period Thru October 19
---------------------------------------------------------------
Judge Erik P. Kimball of the U.S. Bankruptcy Court for the
Southern District of Florida extended CCH John Eagan II Homes,
L.P.'s exclusive solicitation period through and including October
19, 2016.
On Sept. 21, 2016, the Troubled Company Reporter said the Debtor
requested the Court to extend the exclusive Plan solicitation
period through confirmation of the Debtor's amended plan, a hearing
of which has been scheduled for Oct. 19, 2016.
About CCH John Eagan
Headquartered in Palm Beach Gardens, Florida, CCH John Eagan II
Homes, L.P., owns and operates a 180 unit multifamily apartment
complex in Atlanta, Georgia commonly known as Magnolia Park
Apartments Phase II. It filed for Chapter 11 bankruptcy protection
(Bankr. S.D. Fla. Case No. 15-31082) on Dec. 1, 2015, and is
represented by Eric A. Rosen, Esq., at Fowler White Burnett, P.A.
At the time of the filing, the Debtor estimated its assets at
between $1 million and $10 million and liabilities at between $10
million and $50 million.
Judge Erik P. Kimball presides over the case.
The petition was signed by Yashpal Kakkar, managing member, CCH
John Eagan II Partners, LLC, GP.
CHEMTURA CORP: S&P Puts 'BB-' CCR on CreditWatch Positive
---------------------------------------------------------
S&P Global Ratings said that it placed its ratings, including the
'BB-' corporate credit rating, on Chemtura Corp. on CreditWatch
with positive implications.
The CreditWatch placement follows Lanxess AG's announcement that it
has agreed to acquire Chemtura for $33.50 per share. The
transaction values Chemtura at approximately $2.5 billion. The
company expects to complete the transaction around mid-2017.
"We plan to resolve the CreditWatch placement following the close
of the transaction, which is subject to customary closing
conditions and regulatory approval," said S&P Global Ratings credit
analyst Daniel Krauss. "Assuming the transaction closes as
planned, we would subsequently raise our ratings on Chemtura to
equalize them with our ratings on Lanxess before withdrawing our
corporate credit rating on Chemtura." S&P would also withdraw its
issue-level rating on Chemtura's $450 million senior unsecured
notes if they are fully repaid at closing. If the transaction
doesn't close, S&P would likely resolve the CreditWatch placement
and maintain its current ratings on Chemtura.
CLAIRE'S STORES: Pays in Full Delayed Notes Interest
----------------------------------------------------
Claire's Stores, Inc. announced the payment in full of interest due
Sept. 15, 2016, on its 9.0% Senior Secured First Lien Notes due
2019, 6.125% Senior Secured First Lien Notes due 2020 and 8.875%
Senior Secured Second Lien Notes due 2019. In addition, the
Company announced the closing of its previously announced private
offer to exchange, and the related refinancing of its U.S.
revolving credit facility. The Exchange Offer to holders of the
Company's Second Lien Notes, 7.750% Senior Notes due 2020 and
10.500% Senior Subordinated Notes due 2017 was made pursuant to a
confidential offer to exchange statement dated Aug. 12, 2016, as
amended on Aug. 29, 2016, and a related letter of transmittal. The
Company had delayed payment of interest on the Secured Notes
pending completion of the Exchange Offer, and a related amendment
and restatement of its Europe credit facility.
Exchange Offer
On Sept. 20, 2016, Claire's Stores accepted approximately $331.7
million aggregate principal amount of Notes tendered, consisting of
approximately $227.7 million aggregate principal amount of Second
Lien Notes, approximately $103.3 million aggregate principal amount
of Unsecured Notes and approximately $0.7 million aggregate
principal amount of Subordinated Notes, in exchange for
approximately $117.3 million aggregate principal amount of new
five-year term loans of the Company and certain of its
subsidiaries, consisting of approximately $20.4 million aggregate
principal amount of 9.00% senior secured term loans due 2021 of the
Company and its domestic subsidiaries, approximately $66.3 million
aggregate principal amount of 9.00% senior secured term loans due
2021 of CLSIP LLC, an indirect wholly-owned subsidiary of the
Company, and approximately $30.6 million aggregate principal amount
of 9.00% senior term loans due 2021 of Claire's (Gibraltar)
Holdings Limited, an indirect wholly-owned subsidiary of Claire's
Stores.
In addition, certain funds managed by affiliates of Apollo Global
Management, LLC and Claire's Inc., the parent of Claire's Stores
effected a similar exchange of all approximately $183.6 million
aggregate principal amount of Claire's Stores' 10.500% PIK Senior
Subordinated Notes due 2017 held by the Apollo Funds and all
approximately $58.7 million aggregate principal amount of
Subordinated Notes held by Claire's Inc. for approximately $10.5
million aggregate principal amount of Claire's Stores Term Loans,
approximately $34.2 million aggregate principal amount of CLSIP
Term Loans and approximately $15.8 million aggregate principal
amount of Claire's Gibraltar Term Loans.
Upon completion of the Exchange Offer and the Affiliated Holder
Exchange, approximately $573.9 million aggregate principal amount
of Notes was cancelled and replaced by $177.8 million aggregate
principal amount of Term Loans, consisting of $30.9 million
Claire's Stores Term Loans, $100.5 million aggregate principal
amount of CLSIP Term Loans and $46.4 million aggregate principal
amount of Claire's Gibraltar Term Loans. The Company's total
outstanding debt was reduced by approximately $396.0 million, debt
maturities were extended and the Company estimates it will realize
annual cash interest savings of approximately $24 million. As a
result of the Exchange Offer, the Affiliated Holder Exchange and a
May 2016 agreement with the Apollo Funds to exchange Subordinated
Notes for PIK Subordinated Notes, the Company estimates it will
realize annual cash interest savings of approximately $42 million.
Bank Refinancing
In addition, on Sept. 20, 2016, the Company's previously announced
Amendment No. 3 of the Amended and Restated Credit Agreement, dated
as of Sept. 20, 2012, among the Company, Credit Suisse AG, Cayman
Islands Branch, as Administrative Agent, and the other lenders
named therein became effective.
Pursuant to the Third Amendment, the Company completed a
refinancing of the U.S. Credit Facility as follows:
* the Company, its domestic subsidiaries and Claire's Inc., are
parties to an amendment and restatement of the U.S. Credit
Facility, pursuant to which, among other things, the
availability is reduced to an amount equal to $75.0 million
less any amounts outstanding under the ABL Credit Facility,
the maturity has been extended to Feb. 4, 2019, and certain
covenants have been modified;
* Claire's Gibraltar is party to a new $40.0 million credit
agreement maturing Feb. 4, 2019, with the Lenders, the
proceeds of which were used to reduce outstanding amounts
under the U.S. Credit Facility by $40.0 million; and
* the Company, its domestic subsidiaries and Claire's Inc., are
parties to a new ABL Credit Agreement maturing Feb. 4, 2019,
providing for revolving credit loans, subject to borrowing
base availability, in an amount up to $75.0 million less any
amounts outstanding under the U.S. Credit Facility.
Upon the delivery of financial statements for the quarter ended
July 30, 2016, to the Lenders, the Company would have been in
default under the Total Net Secured Leverage Ratio covenant
contained in the U.S. Credit Facility. However, the Third
Amendment changes the Total Net Secured Leverage Ratio covenant so
this default does not arise.
Additional information is available from the SEC website at:
https://is.gd/ux9RNn
About Claire's Stores
Claire's Stores, Inc. is a specialty retailer of fashionable
jewelry and accessories for young women, teens, tweens and girls
ages 3 to 35. The Company operates through its stores under two
brand names: Claire's and Icing. As of July 30, 2016, Claire's
Stores, Inc. operated 2,801 stores in 17 countries throughout North
America and Europe, excluding 806 concession locations. The
Company franchised 596 stores in 29 countries primarily located in
the Middle East, Central and Southeast Asia, Central and South
America, Southern Africa and Eastern Europe. More information
regarding Claire's Stores is available on the Company's corporate
website at www.clairestores.com.
As of July 30, 2016, Claire's Stores had $2.25 billion in total
assets, $2.90 billion in total liabilities and a $646.75 million
stockholders' deficit.
* * *
The TCR reported on April 11, 2016, that Moody's Investors Service
downgraded Claire's Stores, Inc. Corporate Family Rating (CFR) and
Probability of Default Rating to Caa3 and Caa3-PD, respectively.
"[The] downgrades reflect our view that there is an acute
likelihood of a debt restructuring ahead of the June 2017 maturity
of Claire's subordinated notes due to continuing erosion of
liquidity and weak operating performance," stated Moody's Vice
President Charlie O'Shea.
As reported by the TCR on Sept. 26, 2016, S&P Global Ratings
lowered its corporate credit rating on Hoffman Estates, Ill.-based
Claire's Stores Inc. to 'SD' from 'CC'. S&P also removed the
ratings from CreditWatch negative, where it placed them on Aug. 18,
2016.
CLAIRE'S STORES: Said to Tap FTI Consulting
-------------------------------------------
Lauren Coleman-Lochner and Lindsey Rupp, writing for Bloomberg
Brief, reported that FTI Consulting Inc. is advising Claire's
Stores Inc. as the beleaguered chain works to stave off default,
according to people with knowledge of the situation.
According to the report, citing the people, who asked not to be
identified because the information isn't public, FTI was hired in
recent weeks. The report noted that companies often turn to FTI
for help with restructuring, and it has worked with several retail
chains that recently filed for bankruptcy.
Claire's, a tween jewelry seller hurt by competition from online
rivals and other specialty chains, is looking for ways to pay
creditors as demands from its 2007 leveraged buyout by Apollo
Global Management drain its cash, the report related. A
just-completed refinancing deal may buy it time to operate through
the holiday season, but that could depend on support from its
suppliers, the report said, citing Charles O'Shea, an analyst at
Moody's Investors Service.
Claire's has announced revisions to its European credit facility
that allowed it to make up a missed $77 million interest payment
and complete a stalled debt swap, the report related. The line
must be paid off by Dec. 31, though, the report said.
About Claire's Stores
Claire's Stores, Inc. -- http://www.clairestores.com/-- operates
as a specialty retailer of fashion accessories and jewelry for
preteens and teenagers, as well as for young adults in North
America and internationally. It offers jewelry products that
comprise costume jewelry, earrings, and ear piercing services; and
accessories, including fashion accessories, hair ornaments,
handbags, and novelty items.
Based in Pembroke Pines, Florida, Claire's Stores operates under
two brands: Claire's(R), which operates worldwide and Icing(R),
which operates only in North America. As of Jan. 31, 2009,
Claire's Stores, Inc., operated 2,969 stores in North America and
Europe. Claire's Stores also operates through its subsidiary,
Claire's Nippon, Co., Ltd., 213 stores in Japan as a 50:50 joint
venture with AEON, Co., Ltd. The Company also franchises 198
stores in the Middle East, Turkey, Russia, South Africa, Poland
and Guatemala.
As of April 30, 2016, Claire's Stores had $2.27 billion in total
assets, $2.87 billion in total liabilities and a stockholders'
deficit of $606 million.
* * *
The Troubled Company Reporter, on Sept. 28, 2016, reported that
Moody's Investors Service affirmed the Ca-PD probability of default
rating of Claire's Stores, Inc. and appended the PDR with the "/LD"
(limited default) designation. The outlook is unchanged at
negative.
The TCR, on Sept. 26, 2016, reported that S&P Global Ratings
lowered its corporate credit rating on Hoffman Estates, Ill.-based
Claire's Stores Inc. to 'SD' from 'CC'. S&P also removed the
ratings from CreditWatch negative, where it placed them on Aug. 18,
2016. At the same time, S&P lowered the issue-level ratings on the
company's senior secured second-lien debt and senior unsecured debt
facilities to 'D' from 'C' and removed the ratings from CreditWatch
negative. The recovery rating is '6', indicating S&P's
expectations for negligible (0% to 10%) recovery.
As reported by the TCR on Aug. 22, 2016, S&P Global Ratings
lowered its corporate credit rating on Florida-based Claire's
Stores Inc. to 'CC' from 'CCC-' and placed it on CreditWatch with
negative implications.
The TCR reported on April 11, 2016, that Moody's Investors Service
downgraded Claire's Stores, Inc. Corporate Family Rating (CFR) and
Probability of Default Rating to Caa3 and Caa3-PD, respectively.
"[The] downgrades reflect our view that there is an acute
likelihood of a debt restructuring ahead of the June 2017 maturity
of Claire's subordinated notes due to continuing erosion of
liquidity and weak operating performance," stated Moody's Vice
President Charlie O'Shea.
CLARK-CUTLER-MCDERMOTT: Pro Rata Share for Unsecureds Under Plan
----------------------------------------------------------------
Clark-Cutler-McDermott Company, et al., filed with the U.S.
Bankruptcy Court for the District of Massachusetts a Joint Plan of
Liquidation and accompanying Disclosure Statement, which provides
for the liquidation and distribution of all of the Debtors'
assets.
The Debtors generated sales totaling $4.88 million, from
transactions approved by the Bankruptcy Court. They closed each
sale transaction during the week of Sept. 12, 2016.
Through these Sales, the Debtors liquidated substantially all of
their machinery and equipment, in additional to enhancing the value
of their Lafayette real estate by negotiating lease with Bonded
Logic, Inc., which carries a potential eleven-year term.
Significant assets remain in the Estates to be liquidated, however,
including real estate in Lafayette and Franklin, which CCM
Automotive Lafayette LLC owns through its corporate subsidiaries,
the 45% stake in a joint venture located in Irapuato, Mexico (the
Mexico JV), the 20% stake in
Marves Industries, Inc., Airloc LLC, and the lawsuit captioned The
Official Committee of Unsecured Creditors et al. v. General Motors,
LLC, Case No. 16-04083 (Bankr. D. Mass.) (the "GM lawsuit").
Under the Plan, General Unsecured Claims will receive a pro rata
share of distributable cash in the form of periodic distributions
from the Liquidating Trust from time to time. The Disclosure
Statement did not indicate estimated recovery for these Claims.
A full-text copy of the Disclosure Statement dated Sept. 16, 2016,
is available at http://bankrupt.com/misc/mab16-41188-254.pdf
The Debtors are represented by:
K&L GATES LLP
Charles A. Dale III, Esq.
Sven T. Nylen, Esq.
David A. Mawhinney, Esq.
State Street Financial Center
One Lincoln Street
Boston, Massachusetts 02111
Tel: (617) 261-3100
Fax: (617) 261-3175
E-mail: chad.dale@klgates.com
sven.nylen@klgates.com
david.mawhinney@klgates.com
About Clark-Cutler-McDermott Company
Automobile parts manufacturer Clark-Cutler-McDermott Company and
its subsidiary CCM Automotive Lafayette LLC filed chapter 11
petitions (Bankr. D. Mass. Lead Case No. 16-41188) on July 7, 2016.
The petitions were signed by James T. McDermott, CEO.
Hon. Christopher J. Panos presides over the case.
The Debtors are represented by Charles A. Dale, III, Esq., David
Mawhinney, Esq., and Mackenzie Shea, Esq., at K&L Gates LLP.
The Debtors each estimated assets of $10 million to $50 million and
debt of $10 million to $50 million at the time of the chapter 11
filings.
CLIPPER ACQUISITIONS: Moody's Withdraws Ba1 Corp Family Rating
--------------------------------------------------------------
Moody's Investors Servicehas upgraded Clipper Acquisitions Corp's
("Clipper" aka TCW) senior secured term loan and senior secured
revolving credit facility to Baa3 from Ba1. In a related action and
commensurate with the company's move into investment grade, TCW's
corporate family rating has been withdrawn, and an issuer rating of
Baa3 has been assigned. The rating outlook is stable.
The following ratings were upgraded:
-- Senior Secured Term Loan due February 2020, to Baa3 from Ba1
-- Senior Secured Revolving Facility due February 2018, to Baa3
from Ba1
The following rating was assigned:
-- Baa3, Issuer Rating
-- Rating Outlook: Stable
The following rating was withdrawn:
-- Ba1, Corporate Family Rating
RATINGS RATIONALE
The upgrade reflects TCW's significantly improved competitive
position in fixed income, along with much better profitability and
a stronger, less levered balance sheet. TCW's disciplined
investment process has produced good long-term performance, which
has attracted 10 consecutive quarters of net inflows. In turn,
revenues have increased substantially over this period to over $600
million as of 2Q 2016 (last twelve months) from $343 million in
2012. At the same time, the company's pre-tax margin has improved
from as low as 6% to the mid 20% range in recent quarters,
reflecting prudent expense management. This organic growth has led
to improved leverage with the Debt-to-EBITDA ratio declining to
1.9x from 2.9x in late 2012 when we first rated TCW.
TCW's ratings remained constrained by its concentration in fixed
income -- 83% of total AUM - and within fixed income to a single
fund, the MetWest Total Return Fund. However, our concerns around
concentration have been eased by a closer review of TCW's
investment process. "TCW's conservative, disciplined and
collaborative investment process has produced solid long-term
results and should mitigate adverse results should fixed income
fall out of favor," said Vice President -- Senior Analyst Dean
Ungar. In addition, Moody's believes that should fixed income fall
out of favor, TCW could withstand significant outflows and maintain
investment grade level operating and financial metrics.
“We have also become more comfortable with LBO risk related to
private equity sponsor Carlyle's ownership of TCW. Moody's believes
that the economics of another levered recapitalization would be
unlikely given TCW's vastly improved operating performance and
likely valuation. The more likely exit options for Carlyle -- a
corporate acquisition or initial public offering -- would likely
have credit positive implications for the company's ratings.”
Moody's said.
Upward ratings pressure could emerge under the following
conditions: (1) Debt-to-EBITDA continues to decline from its
current level of 1.9x to a sustained level of 1.5x or better; (2)
Equity and International AUM return to positive net flows; (3) the
company makes meaningful progress in diversifying its revenue base
away from the heavy reliance on fixed income.
Downward ratings pressure could result under the following
conditions: (1) Sustained outflows or significant market
depreciation in fixed income; (2) TCW makes a sizable acquisition
that adversely impacts its credit metrics to a level inconsistent
with the current rating; (3) Private equity sponsor Carlyle
implements an exit strategy that would have negative implications
for TCW's creditors.
The principal methodology used in these ratings was Asset Managers:
Traditional and Alternative published in December 2015.
The TCW Group, Inc. is a private independent investment manager.
Founded in 1971 and based in Los Angeles, the TCW Group, Inc.
offers U.S. equities, fixed income, international and alternative
strategies with approximately $198 billion of assets under
management as of 31 July 2016.
COMPASS MINERALS: Moody's Cuts Corporate Family Rating to Ba2
-------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating of
Compass Minerals International, Inc. (Compass Minerals) to Ba2 from
Ba1 and the probability of default rating to Ba2-PD from Ba1-PD.
Moody's also downgraded the senior secured credit facilities rating
to Ba2 from Ba1 and the senior unsecured rating to B1 from Ba2. The
downgrade concludes the review initiated on August 16, 2016 when
the company announced that it plans to acquire the remaining 65%
ownership in a Brazilian specialty plant nutrition company,
Produquimica Industria e Comercio S.A. (Produquimica). Moody's also
assigned a Ba2 rating to a new $450 million new senior secured term
loan due 2021. The proceeds of the term loan will be used to
acquire the remaining 65 percent of equity in Produquimica and
retire a portion of the debt Compass Minerals expects to assume
from Produquimica at closing. The ratings outlook is stable.
"The downgrade of Compass Minerals' ratings reflect increased
leverage pro forma for the 100% debt-funded Produquimica
acquisition and resulting reduced financial flexibility as the
company will get significant cash flow to pay down debt only in
years of above-average snow events," said Moody's analyst
Anastasija Johnson.
Downgraded:
Issuer: Compass Minerals International Inc.
-- Corporate Family Rating to Ba2 from Ba1
-- Probability of Default Rating to Ba2-PD from Ba1-PD
-- $300 million Senior Secured Revolving Credit Facility due
July 2021, to Ba2 (LGD 3) from Ba1 (LGD 3)
-- $400 million Senior Secured Term Loan due July 2021, to Ba2
(LGD 3) from Ba1 (LGD 3)
-- $250 million Senior Unsecured Notes due July 2024, to B1
(LGD 5) from Ba2 (LGD 5)
Assigned:
-- $450 million Senior Secured Term Loan due July 2021 Ba2 (LGD
3)
Affirmed:
-- SGL-3 Speculative Grade Liquidity Rating
The ratings outlook is stable.
RATINGS RATIONALE
The downgrade of Compass Minerals' ratings reflects high leverage
pro forma for the 100% debt-funded Produquimica acquisition at a
time when ongoing significant capital expenditures program combined
with dividends and weakness in salt and fertilizer segments reduce
the company's financial flexibility. Pro forma for the acquisition,
leverage increases to 3.5 times in the twelve months ended June 30,
2016 from 2.7 times actual. However, Moody's expects leverage to
rise close to 4 times by the end of 2016 as a result of the
expected decline in salt and specialty potash fertilizer volumes
and prices. The company is adding debt at a time when it continues
to have elevated capital expenditures for its capacity expansion
projects and continues to increase its dividend. The company is
projected to have negative free cash flow in 2016 and only modest
free cash flow in 2017 assuming average winter conditions. The
company generates sufficient cash to pay down debt only if the
number of snow events is above average, otherwise it will rely on
earnings growth to delever. The uncertainty related to the
weather-dependent business, which generates amajority of earnings,
as well as weak agricultural markets which could prevent recovery
in specialty potassium fertilizer prices contributed to the
downgrade. The rating reflects risks of operating a lower margin
agricultural business in the fragmented Brazilian market.
Compass Minerals has adequate liquidity, as reflected by its SGL-3
rating. Compass Minerals had $93 million of cash on hand as of June
30, 2016 and projected to be free cash flow negative in 2016 and
modestly free cash flow positive in 2017. The company is expected
to reduce its $108 million revolver borrowings by $50 million from
the proceeds of the new term loan. Pro forma for the transaction,
availability on the $300 million revolver increases to
approximately $240 million. The revolver expires in 2021. Moody's
said, “We expect the company will rely more on the revolver for
seasonal working capital swings as cash will be spent on the
ongoing capital expenditure projects.” After Compass Minerals
acquires Produquimica, the Brazilian company will rely on cash on
the balance sheet and local lines of credit for its liquidity.
Compass Minerals has no near-term debt maturities other than a 1%
per year amortization payments on its senior secured term loan of
approximately $8.5 million per year. The senior secured facility
agreement, which includes the revolver, has two financial
covenants, a maximum leverage covenant, and a minimum interest
coverage covenant. Moody's said, “We expect the company to
maintain good availability under its revolver as well as remain in
compliance under its covenants.”
The ratings could be downgraded if leverage remains above 4 times
on a sustained basis or the company undertakes another large
debt-financed acquisition. Ratings could also be downgraded if
operating conditions or liquidity deteriorate.
The ratings could be upgraded if the company successfully
integrates the Producquimica acquisition and improves credit
metrics amid a stronger operating environment, including a recovery
in the agricultural sector. Specifically, the ratings could be
upgraded if the company reduces leverage to below 3.5 times on a
sustained basis and improves retained cash flow to debt to 20%.
The principal methodology used in these ratings was Global Chemical
Industry Rating Methodology published in December 2013.
Headquartered in Kansas, US, Compass Minerals International, Inc.
(Compass Minerals) is a leading North American producer of salt
used for highway deicing, agriculture applications, water
conditioning, and other consumer and industrial uses. The company
is also a significant producer of SOP used on specialty crops, such
as fruits and nuts, in the US and Canada. For the twelve months
ended June 30 2016, Compass Minerals generated net sales (gross
revenues after shipping and handling) and a Moody's-adjusted EBITDA
of $792 million and $306 million, respectively.
CORDERO CORDERO: Taps Richard Schell-Asad as Attorney
-----------------------------------------------------
Cordero, Cordero & Asociados-Asesores Legales, P.S.C. seeks
approval from the U.S. Bankruptcy Court for the District of Puerto
Rico to hire Richard Schell-Asad, Esq.
Mr. Schell-Asad will represent the Debtor in a collection
proceeding it filed against the State Insurance Fund Corp. in the
State Court Superior Room of San Juan, Puerto Rico.
The proposed counsel will be paid an hourly rate of $150 for his
services.
In a court filing, Mr. Schell-Asad disclosed that he is a
"disinterested person" as defined in section 101(14) of the
Bankruptcy Code.
Mr. Schell-Asad's address is:
Richard Schell-Asad
254 San Jose St.
El Mundo Building, Third Floor
San Juan, PR 00901
Tel. (787)722-0741
Fax. (787)724-2563
Cel. (787)559-2712
Email: Rschellasad@aol.com
About Cordero,Cordero
Cordero, Cordero & Asociados-Asesores Legales, P.S.C. sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. D. P.R.
Case No. 16-00828) on February 4, 2016. The petition was signed by
Jose Ramon Cordero Rodriguez, president.
The case is assigned to Judge Enrique S. Lamoutte Inclan.
At the time of the filing, the Debtor estimated its assets and
liabilities at $1 million to $10 million.
COSI INC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Cosi, Inc. 16-13704
294 Washington Street, Suite 510
Boston, MA 02108
Cosi Sandwich Bar, Inc. 16-13705
Xando Cosi of Maryland, Inc. 16-13706
Hearthstone Associates, LLC 16-13707
Hearthstone Partners, LLC 16-13708
Type of Business: The Debtors operate multiple fast-casual
restaurant locations
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
District of Massachusetts (Boston)
Judge: Hon. Melvin S. Hoffman
Debtors' Counsel: Joseph H. Baldiga, Esq.
Paul W. Carey, Esq.
Christine E. Devine, Esq.
MIRICK, O'CONNELL, DEMALLIE & LOUGEE, LLP
1800 West Park Drive, Suite 400
Westborough, MA 01581-3926
Tel: (508) 898-1501
Fax: (508) 898-1502
Email: bankrupt@mirickoconnell.com
pcarey@mirickoconnell.com
cdevine@mirickoconnell.com
Debtors' EDWARD SCHATZ AND THE O'CONNOR GROUP, INC.
Financial
Consultant:
Total Assets: $31.24 million
Total Debts: $19.83 million
The petition was signed by Patrick Bennett, interim chief executive
officer.
Consolidated List of Debtors' 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Robert J. Dourney Severance $383,077
770 Boylston Street
Apt. 121
Boston, MA 02199
Email: dourneyrj@yahoo.com
Cadwalader Wickersham Legal Services $146,942
Email: andre.mentes@cwt.com
Quad/Graphics, Inc. Trade Debt $110,577
Email: shubbard@pg.com
55 Broad Street LP Lease $90,867
Email: tduring@rubin.com Obligations
Piece Management, Inc. Trade Debt $85,037
Email: cpriest@piecemanagement.com
498 Seventh, LLC Lease $75,637
Email: maureen@gcomfort.com Obligations
T-C 685 Third Avenue, LLC Lease $72,770
Email: Obligations
Anthony.Muscatelli@am.jll.com
Uniway Partners, LP Lease $68,239
Email: ocruickshank@empirestate Obligations
realtytrust.com
Bank Direct Capital Finance Trade Debt $65,960
Email:
contactus@bankdirectcapital.com
RCPI Landmark Properties, LLC Lease $65,047
Email: kwood@tishmanspeyer.com Obligations
SRI Eight 399 Boylston LLC Lease $62,287
Email: Jenn_DeRenzi@equityoffice.com Obligations
Rose Hill Property Associates, Inc. Lease $61,549
Email: nbalraj@mhpnyc.com Obligations
Pan Am Equities, agent for Lease $58,936
Whitehall Properties II, LLC Obligations
Email: JDiPaola@panAmEquities.com
Street Retail, Inc. Lease $57,096
Email: CRidgley@federalreaty.com Obligations
230 West Monroe PT, LLC Lease $52,286
Email: eradke@accessoservices.com Obligations
53 State Street Lessee LLC Lease $51,140
Email: sflagg@lpc.com Obligations
Easton Town Center LL, LLC Lease $51,018
Email: ckeller@steiner.com Obligations
Microsoft Corporation Trade Debt $50,437
Email:v-damen@microsoft.com
mscredit@microsoft.com
BDO USA, LLP Professional $46,835
Email: jbalchette@bdo.com Services
The Art Institute of Chicago Lease $46,643
Email: pjones@artic.edu Obligations
COSI INC: Files Chapter 11, Has Deal to Sell Biz for $6.8 Million
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Cosi, Inc. and its direct and indirect subsidiaries filed voluntary
Chapter 11 bankruptcy petitions (Bankr. D. Mass. Case No. 16-13704)
on September 28, 2016, in Boston. The Debtors continue to operate
their businesses and manage their properties as
"debtors-in-possession" under the jurisdiction of the Bankruptcy
Court and in accordance with the applicable provisions of the
Bankruptcy Code and orders of the Bankruptcy Court.
$4.1M DIP Financing Facility
In connection with the Chapter 11 Cases, the Debtors filed motions
seeking Bankruptcy Court approval of debtor-in-possession financing
on the terms set forth in that certain non-binding
Debtor-in-Possession (DIP) Financing Term Sheet effective on or
about September 28, 2016, with respect to the Company, the
Company's direct and indirect subsidiaries -- Hearthstone Partners,
LLC, Hearthstone Associates, LLC, Xando Cosi Maryland, Inc. and
Cosi Sandwich Bar, Inc. -- as joint and several borrowers, AB
Opportunity Fund LLC, AB Value Partners, L.P., and one or more
entities affiliated with MILFAM II L.P., as lenders.
The DIP Term Sheet provides for secured super-priority
debtor-in-possession multiple draw credit facility consisting of up
to a $4.1 million term loan, in the form of one or more promissory
notes, with a maximum draw of $1.8 million until the entry of a
final DIP order of the Bankruptcy Court, to be used for general
corporate expenditures and funding operations during a "363 Sale
Process", in accordance with the agreed upon documentation and an
approved budged. Interest will accrue at a rate of 12% per annum,
with a 3% facility fee of the committed amount, and an additional
3% exit fee.
The maturity date of the DIP Financing shall be the earliest of (i)
the closing of a sale of all or a substantial part of the assets of
Debtors; (ii) the three month anniversary of the entry of the
Interim DIP Order approving the DIP Financing by the Bankruptcy
Court; or (iii) the occurrence and declaration of an "Event of
Default" under the DIP Financing documentation.
The DIP Financing will be secured by security interests in all of
the property of the bankruptcy estates of the Debtors. The DIP
Financing is subject to certain customary and appropriate
conditions for financings of similar type. The DIP Lenders and the
Debtors anticipate finalizing and executing the DIP Financing
documentation promptly.
As of September 28, 2016, there was approximately $7.5 million in
outstanding borrowings under the prepetition credit arrangement. As
a result of the filing of the Chapter 11 Cases, all commitments
under the prepetition credit arrangement were terminated and all
loans (with accrued interest thereon) and all other amounts
outstanding under the prepetition credit arrangement became
immediately due and payable.
As a result of the filing of Chapter 11 Cases, the Company believes
that the ability of the Debtors' creditors to seek remedies to
enforce their rights against the Company under these and other
agreements are stayed and creditor rights of enforcement against
the Debtors are subject to the applicable provisions of the
Bankruptcy Code.
A copy of the None-Binding Term Sheet is available at
https://is.gd/Whziy7
Deal to Sell Biz for $6.8MM
The Debtors will begin immediately a process, called a "363 Sale
Process", to solicit bids and conduct a sale to one or more third
parties of substantially all of the assets of the Debtors. In
connection with the 363 Sale Process, the Company expects that the
DIP Lenders or their designees will serve as the "stalking horse
purchaser" under a "stalking horse agreement" for a purchase price
of approximately $6,800,000, which will consist of a credit bid of
all DIP obligations of approximately $4,100,000, amounts to cure
assumed leases in an estimated amount of $1,500,000 and cash amount
to the estate paid upon closing of $1,200,000. The stalking horse
agreement is expected to include a break-up fee of up to $315,000
plus expenses not to exceed $150,000 if another purchaser purchases
the assets in lieu of the DIP Lenders or their designee.
In connection with the 363 Sale Process, the DIP Facility
documentation and DIP orders will contain milestones and other
covenants related to the 363 Sale Process including the following
milestones which may be modified by the DIP Lenders in their sole
discretion:
(i) filing with the Bankruptcy Court no later than October 3,
2016 of a sale motion seeking approval of the 363 Sale Process and
bidding protections for the stalking horse purchaser,
(ii) execution of a stalking horse agreement with the DIP
Lenders as the stalking horse purchaser no later than October 7,
2016,
(iii) entry of order relating to bidding procedures no later
than October 14, 2016,
(iv) entry of order(s) approving transactions relating to the
sale of all or substantially all of the assets of the Debtors no
later than November 22, 2016 and
(vi) closing of transactions relating to sale of all or
substantially all of the assets of the Debtors no later than
November 28, 2016.
"We worked very hard to avoid this step," said Mark Demilio, Cosi's
Chairman of the Board. "With the advice and support of outside
advisors, we've explored multiple paths, including raising capital
through equity and/or debt in either public or private
transactions, selling the Company outside the bankruptcy process,
selling certain assets of the Company, and other transactions to
restructure the balance sheet or raise capital, while also focusing
on attempting to improve sales, reduce costs, and exit
underperforming locations. It's become clear that, despite the
extensive efforts by the Company, no such transactions are
achievable at this time, that the Company cannot continue to
operate in its current financial condition, and that the best
alternative for the Company and its creditors would be to
accomplish a sale through the bankruptcy process."
Prior to the Chapter 11 filing, the Company closed 29 of its 74
Company-owned restaurants. The 31 franchised locations are
unaffected. The plan outlines a fast-track process that will allow
Cosi to emerge from the restructuring under new ownership and with
an improved financial position and stronger brand.
"This was a difficult step, but it was necessary to address our
liquidity issues," said Patrick Bennett, Sr., interim CEO of Cosi,
Inc. "Cosi's core business and franchise base remain intact, and
we filed with the liquidity resources necessary to carry out the
restructuring plan. We believe this process will allow the Company
to right-size its balance sheet, reduce its debt, and focus on
improving the business and stabilizing the brand," Bennett stated.
Mirick, O'Connell, DeMallie & Loungee, LLP is serving as legal
counsel, and the Company will appoint a Chief Restructuring Officer
within 7-10 days.
Patrick Bennett continues to serve as interim CEO, and Edward
Schatz of The O'Connor Group, Inc. continues to serve as interim
CFO.
In the bankruptcy petition, Cosi listed more than $31.2 million in
assets and more than $19.8 million in total debt.
About Cosi, Inc.
Cosi -- http://www.getcosi.com/-- is an international fast casual
restaurant company known for flatbread and square bagels.
COSI INC: Files for Bankruptcy, Cites Drop in Sales
---------------------------------------------------
Cosi, Inc., operator of 107 fast-casual restaurants located in the
United States, the United Arab Emirates, and Costa Rica, has filed
for bankruptcy protection, citing deteriorating sales and a
conflict regarding a collateral agreement.
The Company is looking for potential purchasers of its remaining
profitable restaurants and believes that a going concern sale under
Section 363 of the Bankruptcy Code is the best route to maximize
the value of its operations.
Cosi was joined in Chapter 11 by affiliates Cosi Sandwich Bar,
Inc., Xando Cosi of Maryland, Inc., Hearthstone Associates, LLC and
Hearthstone Partners, LLC.
The Debtors have commenced the Chapter 11 proceedings "in order to
prevent the potential full shut-down of operations, to preserve the
jobs of more than 1,000 employees and to protect the interest of
their creditors and landlords."
Days prior to the bankruptcy filing, Cosi closed 29 underperforming
restaurants and laid off 450 employees in an attempt to preserve
its core business enterprise.
In an affidavit filed with the bankruptcy court, Interim Chief
Executive Officer Patrick Bennett said that the Debtors' cash flow
available for operations and for debt service has been negatively
impacted by the overall economic conditions within the "fast-casual
restaurant" industry, which has negatively impacted sales and
restaurant-level profits. He added that the Debtors have been
unable to fund much-needed expenditures required for many locations
to remain competitive within their market and to become
profitable.
For the year ending Dec. 31, 2015, the Debtors recorded revenue of
$89.89 million and a net operating loss of $15.65 million.
As of the end of the second quarter of 2016, the Debtors had
consolidated net sales of $22.3 million (a decrease of $1.7 million
compared to the second quarter of 2015), net losses of
approximately $3.1 million and cash on hand of approximately $3
million. As of the Petition Date, cash on hand decreased to
roughly $950,000.
As of June 27, 2016, Cosi had total assets of $31.24 million and
total liabilities of $19.83 million.
In late 2015, the Debtors began efforts to streamline their cost
structure and realign their operational structure to improve cash
flow. The Debtors had engaged Midtown Partners, a boutique
investment banking firm specializing in raising capital for
distressed companies to explore the possibility of a sale of the
Company to a strategic or financial buyer. However, due to the
Company's deteriorating financial condition (including negative
sales trends and increasing negative cash flow) and impending debt
due in April 2017, the Debtors failed to consummate a transaction.
Collateral Dispute Settlement
In April of 2014, the Debtors entered into a series of financing
transactions with three senior lenders, Milfam II LP, AB
Opportunity Fund LLC, and AB Value Partners, L.P. In connection
with the 2014 Financing, Cosi executed promissory notes in favor of
the Senior Secured Lenders which have principal balances as
follows: Milfam ($5 million); AB Opportunity ($2 million); and AB
Value ($500,000).
Two of Cosi's subsidiaries, Xando and CSB, have guaranteed Cosi's
obligations to the Senior Secured Lenders.
In connection with the 2014 Financing, Cosi provided the Senior
Secured Lenders with a Pledge Agreement by which Cosi pledged its
ownership interest in one of the subsidiaries, HALLC, to the Senior
Secured Lenders. HALLC is the 100% owner of the operating
subsidiary HPLLC. The Debtors assert that the Senior Secured
Lenders have no direct collateral interest in HPLLC.
In September 2016, the Senior Secured Lenders requested that the
Debtors confirm their collateral obligations by executing a
Collateral Agreement. As a result of the Senior Secured Lenders'
requests, on Sept. 9, 2016, all of the Debtors, except, HPLLC,
entered into a Collateral Agreement.
The Debtors said that since executing the 2016 Collateral
Agreement, they have determined that the original description in
the Senior Secured Notes was an insufficient grant of an interest
in their collateral pursuant to the Uniform Commercial Code,
Article 9, Section 108, which governs the sufficiency of collateral
descriptions in a security agreement and renders ineffective
"supergeneric" collateral descriptions. As a result, the Debtors
maintained that the 2016 Collateral Agreement provided each of the
Senior Secured Lenders with a significant enhancement of its
collateral position which the Debtors may be able to challenge
under certain provisions of the Bankruptcy Code, including, among
other things, preference avoidance and recovery positions.
The Senior Secured Lenders believe they have defenses to any
actions the Debtors may take to avoid their interests.
To address the dispute, the Debtors and the Senior Secured Lenders
have agreed that:
(a) the Senior Secured Lenders will fund the Debtors'
operations during the Chapter 11;
(b) the Senior Secured Lenders will be the staking horse
bidder for the purchase of the Debtors out of Chapter 11;
(c) the Senior Secured Lenders will be restricted regarding
their ability to "credit bid" in the sales process; and
(d) all issues related to the potential challenges to the 2014
Financing and the 2016 Collateral Agreement will be
preserved for a later determination in the bankruptcy
cases.
A full-text copy of Patrick Bennett's declaration is available for
free at http://bankrupt.com/misc/5_COSI_Declaration.pdf
About Cosi
Cosi, Inc. is an international fast-casual restaurant company
featuring its crackly-crust flatbread made fresh throughout the day
and specializing in a variety of made-to-order hot and cold
sandwiches, salads, bowls, breakfast wraps, "Squagels" (square
bagels), melts, soups, flatbread pizzas, S'mores, snacks, deserts
and a large offering of handcrafted, coffee-based, and specialty
beverages. Cosi prides itself on using the best ingredients,
including foods containing high quality proteins, and products
devoid of high-fructose corn-syrup and preservatives and
additives.
Cosi, the parent company of all the Debtors, was first established
in New York in 1996 and incorporated in Delaware in 1998. In 2002,
Cosi became publicly traded company on the Nasdaq exchange under
the symbol "COSI".
Prior to the Petition Date, the Debtors had 72 debtor-owned
locations and 35 franchised locations and employed 1,555 people.
Mirick, O'Connell, Demallie & Lougee, LLP serves as counsel to the
Debtors. Edward Schatz and The O'Connor Group, Inc., is the
Debtors' financial consultant.
The cases are pending in the U.S. Bankruptcy Court for the District
of Massachusetts and are assigned to Judge Melvin S. Hoffman.
COSI INC: Files for Chapter 11 Bankruptcy to Facilitate Sale
------------------------------------------------------------
Cosi, Inc., the fast-casual restaurant company, on Sept. 28, 2016,
disclosed that it and its subsidiaries filed voluntary Chapter 11
petitions in the United States Bankruptcy Court for the District of
Massachusetts, initiating a process intended to preserve value and
accommodate an orderly going-concern sale of Cosi's business
operations.
Cosi has obtained approximately $4 million in post-petition
debtor-in-possession (DIP) financing, which, subject to Bankruptcy
Court approval, will provide the Company with liquidity to maintain
its operations in the ordinary course of business during the
Chapter 11 process.
Prior to the Chapter 11 filing, Cosi entered into a non-binding
term sheet with its lenders, AB Opportunity Fund LLC, AB Value
Partners, L.P., and one or more entities affiliated with Milfam II
L.P., pursuant to which the DIP lenders or their designees have
proposed to purchase substantially all of Cosi's assets and,
subject to Bankruptcy Court approval, would serve as the "stalking
horse" in a sale process under Section 363 of the Bankruptcy Code.
The term sheet is non-binding and the transaction contemplated
thereby is subject to, among other things, Cosi's compliance with
certain covenants. Cosi intends for such a sale, if completed, to
ensure a smooth and swift transition of the business and operations
to the DIP Lenders or their designees, which would be supported by
a stronger balance sheet due to exiting underperforming locations
and once company assets are sold free of any claims.
In accordance with the sale process under Section 363 of the
Bankruptcy Code, notice of the proposed sale to the DIP lenders or
their designees will be given to third parties and competing bids
will be solicited. Cosi's Board of Directors will manage the
bidding process and evaluate the bids, in consultation with
independent professional advisors and as overseen by the Bankruptcy
Court.
Cosi's Board of Directors unanimously determined that a sale in
Chapter 11 is in the best interest of the Company and its
creditors. The process allows Cosi to continue normal business
operations during the Bankruptcy Court supervised sale process.
"We worked very hard to avoid this step," said Mark Demilio, Cosi's
Chairman of the Board. "With the advice and support of outside
advisors, we've explored multiple paths, including raising capital
through equity and/or debt in either public or private
transactions, selling the Company outside the bankruptcy process,
selling certain assets of the Company, and other transactions to
restructure the balance sheet or raise capital, while also focusing
on attempting to improve sales, reduce costs, and exit
underperforming locations. It's become clear that, despite the
extensive efforts by the Company, no such transactions are
achievable at this time, that the Company cannot continue to
operate in its current financial condition, and that the best
alternative for the Company and its creditors would be to
accomplish a sale through the bankruptcy process."
Prior to the Chapter 11 filing, the Company closed 29 of its 74
Company-owned restaurants. The 31 franchised locations are
unaffected. The plan outlines a fast-track process that will allow
Cosi to emerge from the restructuring under new ownership and with
an improved financial position and stronger brand.
"This was a difficult step, but it was necessary to address our
liquidity issues," said Patrick Bennett, Sr., interim CEO of Cosi,
Inc. "Cosi's core business and franchise base remain intact, and
we filed with the liquidity resources necessary to carry out the
restructuring plan. We believe this process will allow the Company
to right-size its balance sheet, reduce its debt, and focus on
improving the business and stabilizing the brand," Bennett stated.
Court filings and other information related to the restructuring
proceedings are available on the Company's website at
www.getcosi.com
Mirick, O'Connell, DeMallie & Loungee, LLP is serving as legal
counsel, and the Company will appoint a Chief Restructuring Officer
within 7-10 days. Patrick Bennett continues to serve as interim
CEO, and Edward Schatz of The O'Connor Group, Inc. continues to
serve as interim CFO.
About Cosi, Inc.
Cosi -- http://www.getcosi.com/-- is an international fast casual
restaurant company. There are currently 45 Company-owned and 31
franchise restaurants operating in fourteen states, the District of
Columbia, Costa Rica and the United Arab Emirates.
DAILY HAVEN: Seeks to Employ Ordinary Course Professionals
----------------------------------------------------------
Daily Haven, Inc. has filed a motion seeking approval from the U.S.
Bankruptcy Court for the Northern District of Georgia to hire
professionals used in the ordinary course of business.
The request, if granted, would allow the Debtor to hire "ordinary
course professionals" without filing separate employment
applications.
In the same filing, the Debtor asked the court to approve its
proposed procedures for compensating OCPs.
Under the proposed process, the Debtor will pay each OCP, without
prior application to the court, 100% of its fees and reimburse 100%
of its expenses.
No single OCP other than the Debtor's accountants will be paid in
excess of $5,000 per month on average over a rolling four-month
period. Meanwhile, accountants may be paid up to $10,000 per month
on average over a rolling six-month period, according to the
proposed procedures.
About Daily Haven
Daily Haven, Inc. operates a Home Health Care and Day Center for
individuals with special needs in the Conyers area.
The Debtor filed a Chapter 11 bankruptcy petition (Bankr. N.D. Ga.
Case No. 16-63419) on Aug. 1, 2016. The Debtor is represented by
James Brian Cronon, Esq.
In its petition, the Debtor estimated $500,000 to $1 million in
assets and liabilities. The petition was signed by Suzann Maughon,
owner and chief officer.
DAL PARTNERS: Case Summary & 4 Unsecured Creditors
--------------------------------------------------
Debtor: DAL Partners, LLC
1680 Rohrerstown Road
Lancaster, PA 17601
Case No.: 16-16844
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Hon. Magdeline D. Coleman
Debtor's Counsel: Barry A. Solodky, Esq.
NIKOLAUS & HOHENADEL, LLP
212 North Queen Street
Lancaster, PA 17603
Tel: 717-299-3726
Fax: 717-299-1811
E-mail: bsolodky@n-hlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dean Landis, president.
A copy of the Debtor's list of four unsecured creditors is
available for free at http://bankrupt.com/misc/paeb16-16844.pdf
DAWSON INTERNATIONAL: Needs Until January 2017 to File Plan
-----------------------------------------------------------
Dawson International Investments (Kinross) Inc. and certain of its
affiliates ask the U.S. Bankruptcy Court for the Southern District
of New York to extend the exclusive period to (a) file a chapter 11
plan for each of the Debtors through and including January 23,
2017, and (b) solicit acceptances of a chapter 11 plan for each of
the Debtors through and including March 24, 2017
According to the Debtors, the issues to be addressed in conjunction
with formulating a viable chapter 11 plan include, complex issues
regarding the termination of a pension plan, and the determination
of the magnitude of potential environmental claims that might exist
against one or more of the estates.
By Order entered on August 31, 2016, the Court authorized the
Debtors to, in their discretion, investigate and initiate a
standard termination of the pension plan, and the Debtors are now
beginning to undergo that process.
Additionally, while the General Bar Date for claims to be filed
against the estates was August 15, 2016, the Governmental Bar Date
is November 23, 2016 and has not yet occurred. The Debtors
anticipate that certain governmental agencies will likely file
claims against certain of the Debtors' estates based on alleged
environmental liabilities.
About Dawson International
Dawson International is in the cashmere business. It comprises two
trading divisions, based in the UK and the USA. The UK division
comprises the Barrie Knitwear business, based in Hawick Scotland.
It manufactures highest quality cashmere garments at its factory in
the Scottish borders and sells to some of the world's most
prestigious couture houses, department stores and private label
retail outlets.
Based in Natick, Massachusetts, Ilion Properties, Inc., Dawson
International Investments (Kinross) Inc., Dawson International
Properties, Inc., DCC USA Inc., and Dawson Luxury Garments LLC
filed separate Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y.
Case Nos. 16-11550 to 16-11554) on May 27, 2016. The Hon. James L.
Garrity Jr. presides over the cases.
Patrick L. Hayden, Esq., and Nathan S. Greenberg, Esq., at
McGUIREWOODS LLP, serve as counsel to the Debtors.
The Debtors estimate these assets and liabilities in their
petition:
Estimated Estimated
Assets Liabilities
----------- -----------
Ilion Properties, Inc. $1MM-$10MM $1MM-$10MM
Dawson International Investments $1MM-$10MM $1MM-$10MM
Dawson International
Properties, Inc. $1MM-$10MM $1MM-$10MM
DCC USA Inc. $1MM-$10MM $1MM-$10MM
The petitions were signed by David G. Cooper, president and sole
director.
DCP MIDSTREAM: S&P Affirms 'BB' CCR & Revises Outlook to Stable
---------------------------------------------------------------
S&P Global Ratings said it affirmed its 'BB' corporate credit and
senior unsecured debt ratings on DCP Midstream LLC and revised the
outlook to stable from negative. S&P also revised the recovery
rating on the company's senior unsecured debt to '3' from '4',
reflecting S&P's expectation of meaningful (50%-70%; lower end of
the range) recovery in the event of default). The 'BB' rating is
unchanged.
At the same time, S&P affirmed its 'BB' corporate credit and senior
unsecured debt ratings on master limited partnership DCP Midstream
Partners L.P. and revised the outlook to stable from negative.
"The stable rating outlook reflects our view of adequate liquidity
and NGL prices remaining above 40 cents per gallon, resulting in
consolidated adjusted debt to EBITDA below 5.5x in the long term,"
said S&P Global Ratings credit analyst Mike Llanos.
S&P could lower the rating if it expects consolidated leverage to
be sustained above 6x and if there were no offsetting actions taken
by management or additional support from the sponsors. This could
result from NGLs pricing at or below 35 cents per barrel.
S&P could raise the rating if it expects consolidated leverage to
be sustained below 5x, this could occur if NGL prices are sustained
above 55 cents.
DELIVERY AGENT: Selling Clean Fun Business to HALO
--------------------------------------------------
Delivery Agent, Inc., and affiliates ask the U.S. Bankruptcy Court
for the District of Delaware to authorize the asset sale agreement
with respect to the sale of merchandising and promotional marketing
company, Clean Fun Promotional Marketing, Inc. ("Clean Fun
Business"), and related assets to HALO Branded Solutions, Inc. for
a purchase price equal to the assumed liabilities plus a cash
payment of (i) $1,000,000 plus (ii) the value at Closing of the
uncollected accounts receivable relating to the Clean Fun Business
plus (iii) the Paid Pre-Petition Commission Amounts plus (iv) the
Identified Orders Payment Amount, less certain adjustments, subject
to overbid.
Delivery Agent ("Company") has developed one of the leading and
most advanced platforms to monetize entertainment content (TV,
movies, music, and sports) through an integrated suite of solutions
built to help increase fan engagement and drive direct revenue
generation.
In business for over a decade, the Company's solutions serve some
of the world's largest media companies and consumer brands. The
Company is headquartered in San Francisco, CA, with offices in
Denver, CO; Costa Mesa, CA; Crozet, VA; and New York, NY. The
Company engages in three related businesses: (1) e-commerce, (2)
romotional marketing (Clean Fun), and (3) television commerce or
"t-commerce" (ShopTV).
The Debtors operate Clean Fun Business, which enables major
entertainment, media, and consumer brands to address their business
and marketing needs. The Clean Fun Business operates out of, and
is the only business of the Debtors operating out of, the Debtors'
Costa Mesa offices.
In the ordinary course of business, the Clean Fun Business uses the
services of approximately 28 agents, who are independent
contractors and paid entirely for commissions earned ("Account
Executives"). As of the Petition Date, the amount owed to these
Account Executives on account of prepetition commissions earned was
approximately $458,700 in total. On Sept. 16, 2016, pursuant to the
first-day wages and benefits order, the Court approved payment to
the Account Executives of the accrued pre-petition commissions up
to a maximum of $12,850 per individual, which amounts the Debtors
have paid or expect to pay shortly ("Paid Pre-Petition Commission
Amounts").
On May 18, 2016, Delivery Agent retained Houlihan Lokey Capital,
Inc. to evaluate strategic alternatives and to engage in a
marketing process of all of the Company's business segments,
including the Clean Fun Business. Houlihan entered into
discussions with various strategic and financial buyers in early
June 2016 and continues to lead a robust marketing process that has
been underway for more than three months. Although Houlihan was
able to identify a number of interested parties, who provided both
formal and informal indications of that interest, by early August
2016, no purchaser had emerged with a commitment to acquire some or
all of the Company's business units.
By August 2016, with liquidity pressure increasing, it was
projected that obtaining a firm purchase or financing commitment
prior to exhausting the Debtors' remaining liquidity was unlikely.
The Debtors, in consultation with Houlihan and their other
advisors, ultimately concluded that a sale of substantially all of
the Debtors' assets pursuant to Section 363 of the Bankruptcy Code
would most likely maximize the value of the Debtors' assets. As no
buyer or lender had yet emerged from the process run by Houlihan
and the Debtors, the Debtors requested that its prepetition secured
lender, Hillair Capital Investments L.P. ("Hillair," or "DIP
Lender"), agree to become a stalking horse bidder and proposed DIP
lender for the purposes of continuing the sale process in the
context of a chapter 11 filing.
In order to provide the Debtors with the liquidity needed to
accomplish a sale of substantially all of their assets under
Section 363 of the Bankruptcy Code, the DIP Lender agreed to
provide debtor-in-possession financing to the Debtors in an amount
up to $5,425,000 ("DIP Financing") pursuant to the terms and
conditions in that certain Senior Secured, Superpriority
Debtor-In-Possession Loan and Security Agreement, as it may be
amended from time to time ("DIP Agreement"). A motion to approve
the DIP Financing and the DIP Agreement was filed with the Court on
the Petition Date, which the Court approved on an interim basis on
Sept. 16, 2016. A hearing to consider approval of the DIP
Financing on a final basis will be held on Oct. 11, 2016.
As part of the negotiations of the DIP Agreement, the DIP Lender
agreed to fund some of the operations of the Clean Fun Business for
a period of 30 days postpetition while the Debtors pursued a sale
of the Clean Fun Business and related assets. The DIP Agreement
requires that, by Oct. 14, 2016, the Debtors will have sold,
pursuant to terms acceptable to the DIP Lender, or closed the Clean
Fun Business. In other words, the Clean Fun Business must be
shuttered after Oct. 14, 2016, unless an interested party purchases
the assets by such date.
The Debtors also negotiated and entered into a "stalking horse"
Asset Purchase Agreement with the DIP Lender, pursuant to which
Hillair would acquire substantially all of the Debtors' assets,
subject to higher and better offers ("Primary Sale"). A hearing to
consider approval of the bidding procedures with respect to the
Primary Sale will be held on Oct. 11, 2016. Although the Primary
Sale is for substantially all of the Debtors' assets, the DIP
Lender did not agree to purchase the Clean Fun Business as a going
concern. Rather, Hillair and the Debtors contemplated that the
Clean Fun Business, if not sold through a separate sale, would be
discontinued prior to closing the Primary Sale and any remaining
assets of the discontinued business would be included in the
Primary Sale.
Shortly before the filing the chapter 11 petitions, it became clear
to the Debtors that they did not have working capital sufficient to
continue to support the Clean Fun Business through a closing of a
sale of the Clean Fun Business. Therefore, on
Sept. 13, 2016, in order to preserve business continuity of the
Clean Fun Business while the parties continued to work in good
faith in negotiating the Agreement, HALO and the Debtors agreed
("Interim Contract") that HALO would process those customer orders
identified by Clean Fun and authorized by the Company ("Identified
Orders"), and perform all necessary interim services with respect
to such Identified Orders, including providing the working capital
to make related vendor payments and pay commissions to Delivery
Agent's Account Executives. The Interim Contract will allow Clean
Fun to continue in business pending closing of the sale that is the
subject of the Motion.
After extensive arm's-length, good-faith negotiations among the
Selling Debtors, the Buyer, and the DIP Lender and their respective
advisors, the parties have reached an agreement pursuant to which
the Clean Fun Business and related assets will be excluded from the
Primary Sale, and the Buyer will acquire the Clean Fun Business and
related assets as a going concern. Because the proposed Sale would
permit the Clean Fun Business to continue to operate as a going
concern, the Debtors determined that the Agreement represents the
best opportunity for the Debtors to maximize the value of their
assets and serve as a basis for conducting an auction to seek
higher and/or better offers.
The Debtors have negotiated and entered into the Agreement,
pursuant to which the Buyer will acquire the Assets on the terms
and conditions specified therein.
The sale transaction pursuant to the Agreement is subject to
competitive bidding as set forth in the Bidding Procedures.
Pursuant to the terms of the Agreement, the Buyer has agreed to
purchase the Assets for a purchase price equal to the Assumed
Liabilities plus a cash payment of (i) $1,000,000 plus (ii) the
value at Closing of the uncollected accounts receivable relating to
the Clean Fun Business plus (iii) the Paid Pre-Petition Commission
Amounts plus (iv) the Identified Orders Payment Amount, less
certain adjustments.
The Interim Contract, which is a prepetition executory contract, is
incorporated and amended under the Agreement. To compensate
Debtors for any profit received by the Buyer as a result of
collection of the Identified Orders, and to cover the overhead
expenses incurred by the Debtors in maintaining the Clean Fun
Business post-petition, the Buyer will pay the Selling Debtors 7.5%
of the aggregate gross proceeds expected to be received from the
Identified Orders processed as of Closing ("Identified Orders
Payment Amount"), payable upon (a) the Closing or (b) termination
(i) by the Selling Debtors for the Buyer's material breach or (ii)
by the Buyer before the Diligence Deadline.
The Buyer, in making the offer, has relied on promises by the
Debtors to seek the Court's approval of a fee of $250,000
("Break-Up Fee"), which is approximately 4% of the estimated
aggregate Purchase Price to compensate the Buyer for its time,
effort, costs, and expenses incurred in examining the Debtors'
business, conducting due diligence, providing the services under
the Interim Contract, and the loss of opportunity that such time
and effort has caused should another bidder be the Successful
Bidder. The Debtors, in the exercise of their business judgment,
believe that the Break-Up Fee is a necessary inducement for the
Buyer, and thus, necessary to establish a "floor" for the sale of
the Assets and ultimately encourage competitive bidding and promote
the realization of the highest value for the Assets.
Because an official committee of unsecured creditors has not yet
been formed in these cases, and because the Office of the U.S.
Trustee has scheduled a formation meeting on Sept. 29, 2016, it was
the Debtors' view that in order to ensure that a creditors'
committee has opportunity to review the Agreement and the Break-Up
Fee, while preserving the ability of the Debtors to close the sale
transaction by the DIP Agreement's milestone date of Oct. 14, 2016,
as required under the DIP Agreement, the Bidding Procedures,
including the Break-Up Fee, and the Sale should be considered for
approval at the same hearing on Oct. 11, 2016.
To ensure that the Debtors receive the maximum value for the
Assets, the Agreement will serve as the "stalking-horse" bid for
the Assets.
The key provisions of the Bidding Procedures to be employed with
respect to the proposed sale of the Assets and assumption of
Assumed Liabilities as set forth in the Agreement are:
a. Bid Deadline: Oct. 7, 2016, at 12:00 p.m. (PT)
b. Qualified Bid: Greater than or equal to the sum of the
purchase price offered under the Asset Purchase Agreement, plus the
amount of the Break-Up Fee, plus $50,000.
c. Good Faith Deposits: 10% of the purchase price.
d. Auction: October 10, 2016, at 10:00 a.m. at the offices of
Pachulski Stang Ziehl & Jones LLP, located at 919 North Market
Street, 17th Floor, Wilmington, DE.
e. Subsequent Bid: At least $100,000 over the starting bid or
the leading bid.
f. Break-Up Fee: $50,000
g. Sale Hearing: Oct. 11, 2016
h. Objection Deadline: Oct. 6, 2016 at 4:00 p.m (PET)
The Debtors believe that the Bidding Procedures will encourage
bidding for the Assets and are consistent with the relevant
standards governing auction proceedings and bidding incentives in
bankruptcy proceedings. Accordingly, the proposed Bidding
Procedures are reasonable, appropriate, and within the Debtors'
sound business judgment.
A copy of the Agreement and Bidding Procedures attached to the
Motion is available for free at:
http://bankrupt.com/misc/Delivery_Agent_86_Sales.pdf
To facilitate and effect the sale of their Assets, the Debtors also
seek authorization to assume certain pre-petition executory
contracts and leases ("Assumed Contracts") of the Debtors related
to the Assets, and to assign such executory contracts to the Buyer
or the successful bidder.
The Agreement provides that the Buyer will pay all cure amounts, as
determined by the Court, if any, necessary to cure all defaults, if
any, and to pay all actual or pecuniary losses that have resulted
from such defaults under the Assumed Contracts assumed at Closing,
up to the amounts set forth on a Schedule to the Agreement that
will be prepared by the Selling Debtors.
If any counterparty objects for any reason to the assumption and
assignment of an Assumed Contract (including to a cure amount), the
Debtors propose that the counterparty must file the objection no
later than 4:00 p.m. (PET) on Oct. 6, 2016.
Pursuant to the Agreement, and because of the potentially
diminishing value of the Assets, the Debtors must close the sale
promptly after all closing conditions have been met or waived.
Thus, waiver of any applicable stays is appropriate in the
circumstance.
The Purchaser:
Marc S. Simon
HALO BRANDED SOLUTIONS, INC.
Two Prudential Plaza, Suite 3500
180 North Stetson
Chicago, IL 60601
Facsimile: (630) 218-7070
E-mail: marc.simon@halo.com
The Purchaser is represented by:
Ryan D. Harris, Esq.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, IL 60654
Facsimile: (312) 984-7700
E-mail: ryan.harris@kirkland.com
About Delivery Agent
Headquartered in San Francisco, California, Delivery Agent, Inc.,
turns audiences into revenue generating customers for brands,
device manufacturers, and media companies worldwide. It offers
ShopTV, a technology that allows audiences to engage with and
transact directly from advertisements and television shows through
Web, mobile, and advanced television applications; a cloud-based
shopping platform, which enables omni-channel commerce for its
clients with simplicity; eCommerce platform for omni-channel
shopping; relevant and personalized product offers to viewers
based
on the content they are watching with the help of contextual
database; and advertising solutions.
Delivery Agent, Inc., and affiliates MusicToday, LLC, Clean Fun
Promotional Marketing, Inc., and Shop the Shows, LLC, sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 16-12051) on
Sept. 15, 2016.
The Debtors hired Pachulski Stang Ziehl & Jones LLP as local
Counsel; Keller & Benvenutti LLP as general counsel; Arch & Beam
Global, LLC as financial advisor; and Epiq Bankruptcy Solutions,
LLC, as claims and noticing agent.
The cases are assigned to Judge Laurie Selber Silverstein.
DIANE ROSE MAESTRI: Disclosures OK'd; Plan Hearing on Nov. 1
------------------------------------------------------------
The Hon. Robert G. Mayer of the U.S. Bankruptcy Court for the
Eastern District of Virginia has approved the amended disclosure
statement describing the plan of reorganization filed by Diane Rose
Maestri.
The hearing on the confirmation of the Plan will be held on Nov. 1,
2016, at 11:00 a.m. Objections to the confirmation of the Plan
must be filed by Oct. 26, 2016. The last day for filing
acceptances or rejections of the Plan is Oct. 26, 2016. The Debtor
will file a summary of ballots on or before Oct. 28, 2016, and
serve a copy of the summary of ballots on the U.S. Trustee.
As reported by the Troubled Company Reporter on Sept. 14, 2016, the
Debtor filed the Amended Disclosure Statement dated Sept. 6, 2016,
describing the Debtor's Plan, which provides for payment of
administrative expenses, priority claims, and secured creditors in
full, either in cash or in deferred cash payments, and provides for
payments to unsecured creditors in an amount greater than they
would receive in the event of a Chapter 7 liquidation -- payment in
full for creditors that have joint claims against Debtor and her
husband, and payment of $10,000 to other non-joint creditors.
Diane Rose Maestri filed for Chapter 11 bankruptcy protection
(Bankr. E.D. Va. Case No. 15-12888) on Aug. 19, 2015.
The Debtor is represented by Daniel M. Press, Esq., at Chung &
Press, P.C.
DIOCESE OF STOCKTON: Chapter 11 Exit Plan Has $17.1-Mil. Funding
----------------------------------------------------------------
The Roman Catholic Bishop of Stockton on Sept. 20 filed with the
U.S. Bankruptcy Court for the Eastern District of California its
proposed plan to exit Chapter 11 protection, which is premised on
the contribution of about $17.1 million to fund the plan and
related expenses.
Of the total contribution, $9.89 million will come from the Debtor,
$3.305 million from insurers, $1 million from The Roman Catholic
Welfare Corporation of Stockton, and $2.905 million from
independent Catholic entities.
Each of the contributions except for those from the Debtor, will be
made pursuant to various settlement agreements.
Under the plan, general unsecured creditors with claims of $500 or
less will be paid on the effective date of the plan. General
unsecured creditors with claims greater than $500 will get 50% of
their claims and will receive cash payments.
The plan also provides for restructuring of the secured claims
against the Debtor, which will be paid over time from its future
business operations.
The restructuring plan maintains funding of programs within the
Debtor, which are considered essential to the financial
reorganization of the religious organization, according to the
disclosure statement explaining the plan.
A copy of the disclosure statement is available for free at
https://is.gd/R0Jwlt
About the Diocese of Stockton
The Diocese of Stockton, California was established on Feb. 21,
1962, by Pope John XXIII from the territory formerly located in
the Archdiocese of San Francisco and the Diocese of Sacramento.
The Diocese, comprising the six counties of San Joaquin,
Stanislaus, Calaveras, Tuolumne, Alpine, and Mono, currently
serves approximately 250,000 Catholics in 35 parishes.
As a religious organization, The Roman Catholic Bishop of
Stockton ("RCB") has no significant ongoing for-profit business
activities. Revenue for the RCB principally comes from the annual
ministry appeal, fees for services provided to non-RCB entities,
donations, grants, and RCB ministry revenue.
When the Diocese was created, most, if not all, of the property of
the Parishes (excluding the pre- and/or elementary (K-8) schools)
was held in the name of the RCB. The RCB also held the property
for the cemeteries in the Diocese as well as some of the real
property to be used for future parishes.
Several Roman Catholic dioceses in the U.S. have filed for
bankruptcy to settle claims from current and former parishioners
who say they were sexually molested by priests.
In Stockton's case, the RCB filed a Chapter 11 bankruptcy petition
(Bankr. E.D. Cal. Case No. 14-20371) in Sacramento on Jan. 15,
2014. Judge Christopher M. Klein oversees the case. Attorneys at
Felderstein Fitzgerald Willoughby & Pascuzzi LLP serve as counsel
to the Debtor.
Stockton scheduled total assets of more than $7.2 million against
debt totaling $11.85 million. The schedules also show that the
diocese has $1.6 million in secured debt. Creditors of the
diocese assert $367,290 in unsecured priority claims and $9.88
million in unsecured non-priority claims.
(Catholic Church Bankruptcy News; Bankruptcy Creditors' Service,
Inc., http://bankrupt.com/newsstand/or 215/945-7000)
DRUMMOND CO: S&P Affirms 'BB' CCR & Revises Outlook to Stable
-------------------------------------------------------------
S&P Global Ratings said it affirmed its 'BB' corporate credit
rating on Drummond Co. Inc. At the same time, S&P revised the
outlook to stable from negative.
"The stable outlook reflects our expectation that Drummond's
adjusted debt to EBITDA will remain between 2x and 2.5x in the next
12 months due to improved prices and volumes," said S&P Global
Ratings credit analyst Vania Dimova. "We expect the company to
maintain adequate liquidity and be able to refinance its revolving
credit facility before May 2017."
S&P could lower the rating if the adjusted debt to EBITDA
indicators increase above 3x or FOCF to debt drops below 15% on a
sustained basis. This would happen if S&P sees a drop in prices or
volumes. S&P could lower the rating if the liquidity becomes less
than adequate in the next 12 months.
S&P would raise the rating if the company's business risk profile
becomes stronger as a result of product diversification or improved
operating efficiency. S&P could also raise the rating if the
company's cash flow leverage improves materially, with adjusted
debt to EBITDA sustained below 2x.
DUCK NECK: Unsecureds To Be Paid From Sale Proceeds
---------------------------------------------------
Duck Neck Campground LLC and WBR Investment Corporation filed a
joint fourth amended disclosure statement accompanying their joint
fourth amended plan of liquidation filed on Aug. 18, 2016.
Under the Plan, holders of allowed Class 5 General Unsecured Claims
will be paid from the net proceeds, after payment of Class 1, 2, 3
and 4 creditors, from the sales of (1) the Campground; (2) the
Salisbury Farm and Residence; and (3) the Salisbury Outparcel.
To the extent that there are insufficient proceeds from the sales
of the Campground, the Salisbury Farm and Residence and the
Salisbury Outparcel to pay the Class 5 creditors in full, the
Debtors are entitled to and may, in their discretion and subject to
approval of the Court in the bankruptcy case of Wilson B. Reynolds,
Jr., elect to utilize net proceeds from the sale of the Tennessee
Campground, the sale of the Tennessee Cabins and Lots, or the sale
of the Tennessee Hotel to pay the Class 5 creditors, after
obtaining necessary approval from the Court. The Debtors
anticipate, but cannot be certain as of the date of the filing of
this Plan, that Class 5 claims will be paid in full. Payment to
allowed Class 5 claim holders will be made upon there being
sufficient funds in the Disbursing Account. No Class 5 claim will
be paid until payment is made in full to Classes 1 through 4.
Class 5 is a class of claims impaired under the Plan.
The Plan will be funded from cash on hand plus these assets: (a)
all net proceeds from the sale of the Campground and Duck Neck's
business as a going concern; (b) all net proceeds from the sale of
the Salisbury Farm and Residence; (c) all net proceeds from the
sale of the Salisbury Outparcel; (d) a portion of the net proceeds
from the sale of the Tennessee Campground; (e) a portion of the net
proceeds from the sale of the Tennessee Cabins and Lots; (f) a
portion of the net proceeds, if any, from the sale of the Tennessee
Hotel and (g) the prosecution and resolution of any Causes of
Action. Because the net proceeds from the Tennessee Campground,
the Tennessee Assets are all property of the Wilson B. Reynolds,
Jr. Bankruptcy Estate, in order to implement the terms of the Plan,
subject to the rights of creditors in the Reynolds Bankruptcy
proceeding, the Reynolds Bankruptcy Estate will seek approval from
this Court in the Reynolds Bankruptcy proceeding to permit the
transfer of certain net proceeds from the sales of the Tennessee
Assets into the Reynolds Bankruptcy Estate for distribution to the
Debtors' creditors, as needed in accordance with the forbearance
agreement. Notwithstanding any other cause of action the Debtors
may have, the Debtors have reviewed all relevant transactions and
have determined there are no potential avoidance actions from which
they can recover additional funds. Because the owners of the
Salisbury Farm and Residence and the Salisbury Outparcel are in
separate pending Chapter 11 cases, those debtors will either obtain
approval from the Court to sell and commit the net proceeds from
the sale of the Salisbury Farm and Residence and the Salisbury
Outparcel to the payment of creditors as set forth in the
forbearance agreement.
The Joint Fourth Amended Disclosure Statement is available at:
http://bankrupt.com/misc/mdb15-15973-216.pdf
Salisbury, Maryland-based WBR Investment Corporation owns
approximately 90 acres of campground located at 500 Double Creek
Point Road, Chestertown, Maryland, on which Chestertown,
Maryland-based Duck Neck Campground LLC operates a campground and
trailer park, with approximately 300 trailer sites, water and
electrical hookups, and sewer connections for its RV visitors.
Duck Neck filed for Chapter 11 bankruptcy protection (Bankr. D. Md.
Case No. 15-15973) on April 27, 2015, estimating its assets and
liabilities at between $1 million and $10 million each. The
petition was signed by Wilson Reynold, sole member.
WBR filed for Chapter 11 bankruptcy protection (Bankr. D. Md. Case
No. 15-15982) on April 27, 2015, estimating its assets and
liabilities at between $1 million and $10 million each.
Judge Thomas J. Catliota presides over the cases.
Alan M. Grochal, Esq., at Tydings & Rosenberg, LLP, serves as the
Debtors' bankruptcy counsel.
EAST COAST FOODS: Judge Ousts President
---------------------------------------
Katy Stech, writing for The Wall Street Journal Pro Bankruptcy,
reported that the president of Los Angeles's famed Roscoe's House
of Chicken and Waffles has been ousted by a federal judge who said
she doesn't trust him to run its four bankrupt restaurants "in
accordance with the law."
According to the report, U.S. Bankruptcy Court Judge Sheri Bluebond
said that under the management of President Herbert Hudson, who
also founded the chain, Roscoe's lost a $3.2 million employee
discrimination lawsuit, faced immigration law sanctions, underpaid
state taxes and kept informal accounting system with missing
records.
Judge Bluebond said that Mr. Hudson also inappropriately
transferred money from Roscoe's operations to his other businesses,
returning it only after a court-filed report revealed the transfers
to the court, the report related.
The report said Roscoe's bankruptcy lawyer Vahe Khojayan didn't
respond to requests for comment on Judge Bluebond's decision to put
new management in charge. At a court hearing, he argued that the
bankrupt restaurants are profitable -- making more than $200,000 a
month -- diffusing the need for outside leaders, but Judge Bluebond
rejected that argument, the report further related.
"No one's saying this business isn't making money, but he's not
worried about his creditors' interests. He’s worried about his
own interests," the report cited Judge Bluebond as saying of Mr.
Hudson, a Harlem native who founded the business in 1975. "Once the
creditors are paid off, he can have his baby back."
About East Coast Foods
East Coast Foods, Inc., a California corporation, is the owner and
operator of four Roscoe's Chicken N' Waffles restaurants is Los
Angeles area. East Coast Foods sought protection under Chapter 11
of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 16-13852) on
March 25, 2016. The petition was signed by Herbert Hudson,
president.
The Debtor is represented by Vakhe Khodzhayan, Esq., at KG Law,
APC. The case is assigned to Judge Sheri Bluebond.
The Debtor estimated assets of $0 to $50,000 and debts of $10
million to $50 million.
ECI HOLDCO: S&P Lowers Rating to 'B', Outlook Stable
----------------------------------------------------
S&P Global Ratings said that it has downgraded Missouri-based ECI
Holdco Inc. to 'B' from 'B+'. The outlook is stable.
At the same time, S&P lowered its issue-level rating on the
company's senior secured debt to 'B' from 'B+'. S&P's '3' recovery
rating on the debt remains unchanged, indicating its expectation
for meaningful (50%-70%; lower half of the range) recovery in a
payment default scenario.
"The downgrade reflects ECI's weaker-than-expected operating
performance in the second quarter of 2016 and for the remainder of
2016, which has resulted in high debt leverage," said S&P Global
credit analyst Christopher Corey. Following ECI's May 2016
acquisition of Whitepath Fab Tech Inc. for $35 million, S&P had
expected that the company would reduce its leverage in subsequent
quarters. However, challenging conditions in its core appliance
business and delays in some of its contracted sales have pressured
its EBITDA, leading its adjusted debt-to-EBITDA metric to increase
to about 6.0x as of June 30, 2016. Given the slower-than-expected
improvement in ECI's earnings, S&P has revised its base-case
forecast. S&P now estimates that the company's debt-to-EBITDA
metric will be in the 5.5x-6.0x range in 2016 before improving to
about 5.0x in 2017.
The stable outlook on ECI reflects S&P's expectation that the
company will remain highly leveraged over the next 12 months. S&P
anticipates that the company will maintain stable EBITDA margins
and free cash flow generation, which should support a gradual
improvement its key leverage ratios. Specifically, S&P expects
that the ECI's debt-to-EBITDA metric will remain between 5.0x and
5.5x while the company continues to pursue bolt-on acquisitions.
S&P could lower its ratings on ECI if the company continues to
pursue debt-funded acquisitions or engages in another debt-funded
dividend recapitalization such that its adjusted debt-to-EBITDA
metric increases above 6.5x. S&P could also consider downgrading
the company if challenging market conditions or customer contract
cancellations cause its S&P Global adjusted EBITDA margin to
deteriorate by 50 basis points (bps)-100 bps, which could also lead
its adjusted debt-to-EBITDA to increase above 6.5x. Furthermore,
weak free cash flow generation or low covenant headroom would
indicate to S&P that the company is facing liquidity concerns and
could also lead to a downgrade.
While unlikely over the next 12 months, S&P could raise its ratings
on ECI if the company demonstrates improved sales and profits such
that its debt-to-EBITDA metric falls well below 5x and its
FFO-to-debt ratio increases above 12%. S&P views the company's
ownership by a financial sponsor and its aggressive financial
policies as constraining the upside potential for the rating.
ECI HOLDINGS: Court to Consider Plan Outline on Nov. 2
------------------------------------------------------
The U.S. Bankruptcy Court for the District of California will
convene a hearing on Nov. 2, 2016, at 10:30 a.m., to consider
approval of the Disclosure Statement in support of the Chapter 11
Plan proposed by ECI Holdings, Inc.
Written objections to the Plan must be filed so as to be received
by the Court of the Clerk no later than Oct. 25, 2016.
As previously reported by The Troubled Company Reporter, the
Disclosure Statement reveals that ECI Holdings is unaware of any
Class 6 general unsecured claims other than the bifurcated portion
of any secured claim. Class 1, 2, 3 and 4 claims all have other
promising avenues of recovery and it is hoped that the unsecured
portions of these claims, which are Class 6 claims, will be paid in
full through those other avenues. However, because the assets of
the Debtor are sufficient to pay only the secured portion of the
Class 1 claim, Class 2 claim and a portion of the Class 3 claim, it
will not be possible to pay Class 6 unsecured creditors anything
under the plan. A copy of the disclosure statement is available for
free at https://is.gd/vHZOEk
About ECI Holdings
ECI Holdings, LLC sought protection under Chapter 11 of the
Bankruptcy Code in the District of South Carolina (Columbia)
(Case No. 16-02214) on May 2, 2016. The petition was signed by
Bettis C. Rainsford, managing member.
The Debtor is represented by Reid B. Smith, Esq., at Bird and
Smith, PA. The case is assigned to Judge David R. Duncan.
The Debtor estimated assets of $500,000 to $1 million and debts of
$1 million to $10 million.
EMERALD EXPOSITIONS: Moody's Affirms B2 Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service affirmed the current B2 corporate family
rating (CFR) of Emerald Expositions Holding, Inc. (Emerald) and
downgraded the upsized first lien credit facility to B2 from B1.
The outlook remains stable.
The proposed transaction will refinance the existing $200 million
senior unsecured notes with $200 million of incremental first lien
term loans. The proposed all first lien debt structure results in
the downgrade of the credit facility ratings to B2 as the bank debt
will no longer receive a one notch lift above the CFR from the
unsecured notes in the capital structure. The existing revolving
credit facility is also being upsized to $100 million from $90
million. The $200 million of incremental term loans is expected to
be fungible with the existing term loan. The Caa1 rating of the
senior unsecured notes will be withdrawn upon repayment.
The proposed transaction is expected to lead to approximately $8.5
million in interest expense savings, but slight shorten the
maturity of its debt structure as the term loan will mature in 2020
and the unsecured note matures in 2021.
The following is a summary of Moody's ratings actions:
Issuer: Emerald Expositions Holding, Inc.
-- Corporate Family Rating, affirmed at B2
-- Probability of Default Rating, downgraded to B3-PD from B2-
PD
-- Upsized $100mm Senior Secured Revolving Credit Facility,
downgraded to B2 (LGD3) from B1 (LGD3)
-- Upsized Senior Secured 1st Lien Term Loan B, downgraded to
B2 (LGD3) from B1 (LGD3)
-- Outlook, is stable
RATINGS RATIONALE
Emerald's B2 CFR reflects its leverage of 4.9x (including Moody's
standard adjustments) as of Q2 2016 and the highly cyclical nature
of the tradeshow business. The company generates over 90% of
revenue from tradeshows and conferences with the remaining revenue
coming from lower margin print publications and digital products
lines. The limited print exposure, which is in secular decline,
reduces the risk of converting print revenue to digital that has
been a challenge for many companies. Emerald also benefits from
very high EBITDA margins, strong free cash flow, a good liquidity
position, and growth in the event business following the 2008-2009
recession. Leverage has improved from material debt repayment in
2014, 2015, and 2016 as well as from acquisitions and organic
EBITDA growth. The company operates in ten different end markets,
although there is significant concentration to both the General
Merchandise and Sports & Apparel divisions. In addition,
approximately 37% of 2015 revenue was derived from its top five
shows. There is also sensitivity to long term disruptions in air
travel which would negatively impact performance.
Moody's anticipates that Emerald will have good liquidity over the
next 12 months supported by strong free cash flow, a cash balance
of approximately $22 million pro-forma for the transaction, and an
undrawn $100 million revolver due June 2018 (upsized from $90
million). Moody's said, “We anticipate the company will extend
the revolver well in advance of its maturity date. The term loans
are covenant lite and the revolver is subject to a 6x net first
lien leverage test if the revolver is more than 25% drawn. The
company has the ability to incur unlimited incremental secured debt
as long as the total first lien net leverage ratio does not exceed
4.5x plus $72 million ($28 million of the $100 million basket was
used previously).”
The stable outlook reflects Moody's expectation that Emerald will
continue to generate good free cash flow and grow organic revenue
in the low single digits with EBITDA growth at slightly higher
rates. We expect leverage to decline from EBITDA growth as well as
from the company's cash flow being used for acquisitions or debt
repayment.
Moody's could upgrade the ratings if the company maintains good
liquidity, generates a strong free cash flow to debt ratio of over
15%, and grows EBITDA or reduces debt such that leverage is
sustained below 4x. Confidence that the private equity owners would
maintain leverage below 4x would also be required as would positive
organic revenue growth.
Moody's could lower the ratings if leverage is sustained above
5.75x due to economic weakness, poor operating performance, or a
debt funded shareholder friendly transaction. Negative free cash
flow or a weak liquidity position would also lead to negative
rating pressure.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in December 2014.
Emerald Expositions Holding, Inc. (Emerald) (fka Nielsen Business
Media Holding Company) is one of the leading operators of
business-to-business event and tradeshows. The company operates
tradeshows in ten end markets (Gift, Home, General Merchandise &
Manufacturing; Sports & Apparel; Design; Jewelry, Luxury &
Antiques; eCommerce; Creative Services; Licensing; Healthcare;
Military; and Food). In June 2013, investment funds managed by an
affiliate of Onex Partners Manager LP (Onex) acquired the company
from the Nielsen Company for $949 million. Emerald is headquartered
in San Juan Capistrano, California.
EMERALD EXPOSITIONS: S&P Affirms B+ CCR & Revises Outlook to Pos.
-----------------------------------------------------------------
S&P Global Ratings said that it revised its rating outlook on
California-based trade show operator Emerald Expositions Holding
Inc. to positive from stable. At the same time S&P affirmed its
'B+' corporate credit rating on the company.
The 'BB-' issue-level and '2' recovery ratings on the upsized
senior secured credit facility are unchanged. The '2' recovery
indicates S&P's expectation for substantial recovery (70%-90%;
lower half of the range) of principal in the event of a payment
default. The issue-level rating is one-notch higher than the 'B+'
corporate credit rating on the company.
S&P will withdraw its ratings on the company's 9% senior unsecured
notes once they have been repaid with proceeds from the
$200 million add-on to the senior secured term loan B.
"The outlook revision reflects Emerald's stable operating
performance, strong free cash flow generation, repayment of debt,
and modest acquisition strategy, which have resulted in adjusted
leverage declining to 4.8x as of June 30, 2016, from 5.3x at the
end of 2015," said S&P Global Ratings' credit analyst Jawad
Hussain. "The revision also reflects our expectation that leverage
will moderate to below 4.5x over the next year as a result of
EBITDA growth and debt repayment."
The positive rating outlook reflects S&P's expectation that
Emerald's leverage will gradually decline to about 4.5x over the
next year as the company continues to grow EBITDA and repay debt
with excess cash flow. Further, S&P expects the company to
continue to demonstrate a financial policy of repaying debt,
funding acquisitions with free cash flow generation, and no debt
funded dividends.
S&P could revise the outlook to stable if the company experiences
slower revenue growth and declining EBIDTA margins, resulting in
leverage remaining above 4.5x on a sustained basis. Additionally,
S&P could revise the outlook to stable if the company adopts a more
aggressive financial policy that includes large debt-funded
acquisitions or shareholder returns.
S&P could raise the corporate credit rating if Emerald's adjusted
leverage decreases to below 4.5x on a sustained basis as a result
of continued low- to mid-single-digit revenue growth coupled with
stable EBITDA margins and solid free cash flow generation. S&P
also expects the company to continue demonstrating a financial
policy that uses free cash flow generation to fund tuck-in
acquisitions or to repay debt.
ENERGY FUTURE: Wants to Settle Forest Creek's $32M Unsec. Claim
---------------------------------------------------------------
BankruptcyData.com reported that Energy Future Holdings filed with
the U.S. Bankruptcy Court a motion for an order authorizing its
entry into and performance under a stipulation between Luminant
Energy Company and Forest Creek Wind Farm. According to documents
filed with the Court, "The Court's approval of the Stipulation will
authorize: (a) Forest Creek to receive after application of Letter
of Credit proceeds, an allowed general unsecured claim against
Luminant in the amount of $32,001,953 on account of its claim
number 10078, and an allowed administrative expense claim against
Luminant in the amount of $1,028,740.29 on account of the Unpaid
Net Energy and (b) the mutual release of all claims relating to the
Contract." The Court scheduled an October 26, 2016 hearing to
consider the motion, with objections due by
Oct. 12, 2016.
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a Portfolio
of competitive and regulated energy businesses in Texas.
Oncor, an 80 percent-owned entity within the EFH group, is the
largest regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS).
As of Dec. 31, 2013, EFH Corp. reported assets of $36.4 billion in
book value and liabilities of $49.7 billion. The Debtors have
$42 billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor, and
Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring agreement
are represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for the
second-lien noteholders owed about $1.6 billion, is represented by
Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A.
Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq.,
Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey,
Esq., and Howard L. Siegel, Esq. An Official Committee of
Unsecured Creditors has been appointed in the case. The Committee
represents the interests of the unsecured creditors of only of
Energy Future Competitive Holdings Company LLC; EFCH's direct
subsidiary, Texas Competitive Electric Holdings Company LLC; and
EFH Corporate Services Company, and of no other debtors. The
Committee has selected Morrison & Foerster LLP and Polsinelli PC
for representation in this high-profile energy restructuring. The
lawyers working on the case are James M. Peck, Esq., Brett H.
Miller, Esq., and Lorenzo Marinuzzi, Esq., at Morrison & Foerster
LLP; and Christopher A. Ward, Esq., Justin K. Edelson, Esq., Shanti
M. Katona, Esq., and Edward Fox, Esq., at Polsinelli PC.
* * *
In December 2015, the Bankruptcy Court confirmed the Debtors' Sixth
Amended Joint Plan of Reorganization. In May 2016, certain first
lien creditors of TCEH delivered a Plan Support Termination Notice
to the Debtors and the other parties to the Plan Support Agreement,
notifying the parties of the occurrence of a Plan Support
Termination Event. The delivery of the Plan Support Termination
Notice caused the Confirmed Plan to become null and void.
Following the occurrence of the Plan Support Termination Event as
well as the termination of a roughly $20 billion deal to sell the
Debtors' stake in Oncor Electric Delivery Co., the Debtors filed
the Plan of Reorganization and the Disclosure Statement with the
Bankruptcy Court on May 1, 2016. On May 11, they filed an amended
joint plan of reorganization and a related disclosure statement.
In June 2016, Judge Sontchi approved the disclosure statement
explaining Energy Future Holdings Corp., et al.'s second amended
joint plan of reorganization of the TCEH Debtors and the EFH
Shared Services Debtors.
On Aug. 27, 2016, Judge Sontchi confirmed the Chapter 11 exit plans
of two of Energy Future Holdings Corp.'s subsidiaries, power
generator Luminant and retail electricity provider TXU Energy Inc.
ESP RESOURCES: Asks Court to Extend Plan Filing Period to Dec. 5
----------------------------------------------------------------
ESP Resources, Inc. and ESP Petrochemicals, Inc. ask the U.S.
Bankruptcy court for the Southern District of Texas to extend the
exclusive period in which they may file a plan of reorganization
until December 5, 2016, with an additional 60 days, or through
February 3, 2017, in which to confirm a plan.
The current deadline for the Debtors to file their Chapter 11 Plan
and Disclosure Statement is October 6, 2016. Their exclusivity
period to confirm a plan expires on December 5, 2016.
The Debtors relate that since the Petition Date, they have
continued efforts to stabilize their business, including
cultivating new business opportunities and implementing cost
cutting measures. The Debtors further relate that these measures
have resulted in new sales opportunities and increased cash flow.
The Debtors relate that their CRO, Charles Johnson, has spent a
significant amount of time stabilizing their operations, including
closing locations, reducing staffing and implementing across the
board pay reductions for all employees. The Debtors further relate
that they have also received interest from several potential
investors and are exploring various exit strategies including a 363
sale of assets and auction in connection with a plan.
The Debtors tell the Court that given Mr. Johnson's recent
engagement, they will need additional time to develop a viable exit
strategy. The Debtors further tell the Court that they will likely
be unable to file and confirm a Chapter 11 Plan prior to the
expiration of the current exclusivity period. They add that the
terms of any plan of reorganization filed by the Debtors will be
dependent upon its income and value.
About ESP Resources, Inc.
Lafayette, Louisiana-based ESP Resources, Inc., is a manufacturer,
distributor and marketer of specialty chemicals and supply
specialty chemicals for a range of oil and gas field applications,
including killing bacteria, separating suspended water and other
contaminants from crude oil and separating oil from gas. The
company also offers analytical services and custom-blended
chemicals for oil and gas wells.
ESP Resources, Inc., and its affiliate ESP Petrochemicals, Inc.
filed chapter 11 petitions (Bankr. S.D. Tex. Case Nos. 16-60021 and
16-60020) on March 10, 2016. The cases are jointly administered
under Case No. 16-60020. The petitions were signed by David A.
Dugas, chief executive officer. The cases are assigned to Judge
David R. Jones. The Debtors are represented by Melissa Anne
Haselden, Esq., and Edward L Rothberg, Esq., at Hoover Slovacek
LLP.
ESP Resources disclosed assets of $4.08 million and debt of $9.55
million. ESP Petrochemicals, Inc., estimated both assets and
liabilities in the range of $1 million to $10 million.
EVEREST HOLDINGS: Moody's Cuts Corporate Family Rating to B3
------------------------------------------------------------
Moody's Investors Service downgraded Everest Holdings, LLC's (dba
"Eddie Bauer") Corporate Family Rating ("CFR") to B3 from B2 and
Probability of Default Rating to B3-PD from B2-PD. Moody's also
downgraded the company's $225 million senior secured term loan due
2020 to Caa1 from B3. The rating outlook is stable.
The downgrade reflects ongoing weaker than anticipated operating
performance and Moody's expectation that the company will be
challenged to reverse operating trends in a difficult retail
environment sufficiently to bring credit metrics back in line with
a B2 rating. Moody's estimates lease adjusted leverage at just over
6.0 times for the LTM period ended July 2, 2016, however leverage
for funded debt is approaching 8 times. In addition, interest
coverage (EBIT/Interest Expense) at below 1.0 time no longer
reflects a B2 rating. Credit metrics have been negatively impacted
by an almost 10% decline in revenue over the LTM period along with
weaker EBITDA margins and elevated borrowings on the company's
unrated $250 million asset-based revolving credit facility
("ABL").
Moody's anticipates that operating performance will improve in the
fourth quarter of fiscal 2016 (off of a weak fourth quarter in
2015) and that the company will make seasonal repayments to its ABL
revolver, which should reduce lease adjusted leverage below 6
times. However, according to Moody's Analyst Dan Altieri, "we
expect that interest coverage will remain depressed at around the 1
time range over the next 12-24 months."
Moody's took the following rating actions:
Issuer: Everest Holdings, LLC
-- Corporate Family Rating, Downgraded to B3
-- Probability of Default Rating, Downgraded to B3-PD
-- $225 million Senior Secured Term Loan due 2020, Downgraded
to Caa1, LGD-4
-- Outlook, Stable
RATINGS RATIONALE
Eddie Bauer's B3 CFR reflects the company's high leverage and weak
interest coverage resulting from a sizable debt-financed
distribution to shareholders in 2014, combined with weaker than
anticipated operating performance. The rating acknowledges that
there will likely be some decline in leverage as a result of
seasonal repayments to the company's revolving credit facility and
modest improvements in operating performance, but anticipates
interest coverage will remain around 1.0 time. The rating also
reflects negative comp store sales in 8 of the last 10 quarters
(after adjusting for FX), fashion risk associated with the
business, and financial policy risk resulting from Eddie Bauer's
financial sponsor ownership.
The B3 rating is supported by the company's well recognized brand
name, although it has struggled with its identity at times, and its
focus on the outdoor lifestyle end-market. Apparel geared towards
the active, outdoor lifestyle continues to be popular with
consumers which should benefit Eddie Bauer. However, competition is
stronger now than it was in the past as a result of numerous
companies focusing on the space. The rating also reflects Moody's
expectation that Eddie Bauer will maintain its adequate liquidity
profile.
Eddie Bauer's liquidity is adequate, supported by approximately $5
million of cash and about $51 million of availability under its
$250 million ABL facility due 2019, as of July 2, 2016. Free cash
flow for the LTM period was negative, largely driven by working
capital related outflows and growth capital spending, however
Moody's anticipates that the company should generate cash in fiscal
2016 and be close to breakeven free cash flow going forward as
working capital normalizes and the company pulls back capital
spending. The rating agency expects that Eddie Bauer will continue
to rely on the ABL facility for seasonal working capital needs,
particularly as it builds inventory for the fourth quarter, the
company's peak selling period. Borrowings as of July 2, 2016 are
approximately $90 million, which is higher than prior years.
Moody's anticipates additional borrowings in the third quarter, but
expects cash generated from operations in the fourth quarter should
result in outstanding borrowings below current levels.
The ABL facility contains a springing fixed charge covenant test of
1.0 time, which is triggered when availability falls below 10%.
Moody's does not expect the covenant to be triggered over the next
12-18 months, but would anticipate limited to no cushion during
some interim periods in the event that it were triggered. The term
loan has no financial covenants.
The Caa1 rating on Eddie Bauer's $225 million senior secured term
loan is one notch below the company's CFR, reflecting its junior
position in the capital structure relative to the ABL facility. The
term loan is secured by a first priority lien on essentially all
assets of domestic subsidiaries (excluding accounts receivable and
inventory on which it has a second priority lien behind the ABL) as
well as a 2/3 pledge of foreign subsidiary stock. The term loan's
collateral position creates effective priority relative to the
company's unsecured obligations including trade payables and lease
rejection claims.
The stable outlook reflects Moody's expectation that continued
pressure on the top line combined with modest improvement to EBITDA
margins resulting from management cost reduction initiatives should
keep credit metrics in line with the B3 rating.
A ratings upgrade would require a reversal of recent operating
trends including an improvement in top line and comp store sales,
as well as higher margins off of a weak LTM period. From a credit
metric perspective, an upgrade would also require debt to EBITDA
sustained below 6.0 times and EBIT/Interest above 1.25 times. In
addition, an upgrade would require Eddie Bauer to maintain its
adequate liquidity profile and the company's private equity owners
to exhibit a willingness to maintain credit metrics at these
levels.
Ratings could be downgraded if Eddie Bauer experiences continued
declines in sales or earnings resulting in EBIT/Interest expense
sustained below 1.0 times. Negative rating pressure could also
develop should the company's liquidity profile deteriorate or as a
result of aggressive financial policies.
The principal methodology used in these ratings was Retail Industry
published in October 2015.
Everest Holdings LLC (dba "Eddie Bauer"), headquartered in
Bellevue, WA, is a holding company with operations under the Eddie
Bauer brand name. Eddie Bauer operates 331 stores in the US,
Canada, and Germany (as well as a joint venture in Japan) and
generated LTM revenue of approximately $810 million through July 2,
2016. It also manages a direct business and domestic and
international licensing partnerships. Everest Holdings is owned by
Golden Gate Capital ("Golden Gate").
FANSTEEL INC: Seeks to Hire Bradshaw Fowler as Legal Counsel
------------------------------------------------------------
Fansteel Inc. and its subsidiaries filed separate applications
seeking approval from the U.S. Bankruptcy Court for the Southern
District of Iowa to hire legal counsel.
In their applications, Fansteel, Wellman Dynamics Corp. and Wellman
Dynamics Machinery & Assembly, Inc. proposed to hire Bradshaw,
Fowler, Proctor & Fairgrave P.C. to provide these legal services:
(a) advise the Debtors with respect to compliance with the
requirements of the U.S. trustee;
(b) advise the Debtors regarding matters of bankruptcy law;
(c) represent the Debtors in any proceedings or hearings in
the bankruptcy court and in any action in any other
court;
(d) conduct examinations of witnesses, claimants or adverse
parties and to assist in the preparation of reports,
accounts and pleadings related to the Debtors'
bankruptcy cases;
(e) advise the Debtors concerning the requirements of the
Bankruptcy Code and applicable rules;
(f) assist the Debtors in the formulation and implementation
of a Chapter 11 plan; and
(g) make any court appearances on behalf of the Debtors.
Jeffrey Goetz, Esq., is expected to serve as the Debtors' lead
attorney. Mr. Goetz's current billing rate is $375 per hour.
Bradshaw does not have any interest adverse to the Debtor or its
estate, and is a "disinterested person" as defined in section
101(14) of the Bankruptcy Code, according to court filings.
The firm can be reached through:
Jeffrey D. Goetz, Esq.
Bradshaw Fowler Proctor & Fairgrave P.C.
801 Grand Avenue, Suite 3700
Des Moines, IA 50309-8004
Tel: (515) 246-5817
Fax: (515) 246-5808
Email: goetz.jeffrey@bradshawlaw.com
About Fansteel
Headquartered in Creston, Iowa, Fansteel operates four business
units at four locations in the USA and one in Mexico with a
workforce of more than 600 employees. Fansteel generated
approximately $87.4 million in revenue in 2015 on a consolidated
basis. WDC contributes approximately 67% of Fansteel's sales. The
rest of the sales are generated from Intercast, a division of
Fansteel, and other non-debtor subsidiaries, as disclosed in court
documents.
Fansteel, Inc. and subsidiaries Wellman Dynamics Corporation and
Wellman Dynamics Machinery & Assembly Inc. each filed a voluntary
petition under Chapter 11 of the Bankruptcy Code. (Bankr. S.D. Iowa
Lead Case No. 16-01823) on Sept. 13, 2016, before Judge Anita L.
Shodeen.
The Debtors listed total assets of $32.9 million and total debts of
$41.97 million as of the bankruptcy filing.
The U.S. Trustee for Region 12 on Sept. 23 appointed nine creditors
of Fansteel Inc. to serve on the official committee of unsecured
creditors.
FRANCIS MARICONDA: Gets Court Approval of Ch. 11 Exit Plan
----------------------------------------------------------
A U.S. bankruptcy judge on September 19 approved the plan of
Francis Mariconda to exit Chapter 11 protection.
Judge Rosemary Gambardella of the U.S. Bankruptcy Court for the
District of New Jersey gave the thumbs-up to the restructuring plan
after finding that it satisfies the requirements for confirmation
under the Bankruptcy Code.
In the same filing, the bankruptcy judge also gave final approval
to the disclosure statement explaining the plan.
The Debtor is represented by:
Norgaard O'Boyle, Esq.
John O'Boyl
184 Grand Avenue
Englewood, New Jersey 07631
Tel: (201) 871-1333
Email: joboyle@norgaardfirm.com
Francis Mariconda sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. N.J. Case No. 15-11328). The case is
assigned to Judge Rosemary Gambardella.
FRANK KERR: Novi Nine Mile Offers $9.83M for Novi Property
----------------------------------------------------------
Frank W. Kerr Co. asks the U.S. Bankruptcy Court for the Eastern
District of Michigan to authorize the sale of its real property
located at 43155, 43157, and 43159 West Nine Mile Road, Novi,
Michigan ("Real Property") outside the ordinary course of business
to Novi Nine Mile Associates, LLC, for $9,825,000.
On Aug. 23, 2016, certain unsecured creditors filed an involuntary
petition for relief under Chapter 7 of the Bankruptcy Code against
the Debtor. O n Sept. 20, 2016, the Debtor consented to the entry
of an order for relief and converted the chapter 7 case to a
chapter 11 case.
In May 2016, the Debtor engaged Conway MacKenzie Management
Services, LLC ("CM") to assist it with cash flow issues and the
Debtor soon thereafter advised its lenders, J.P. Morgan Chase Bank,
N.A. and Comerica Bank, that the Debtor was in default under the
terms of its Credit Agreement.
On June 2, 2016, the Debtor appointed Jeffrey Tischler of CM as its
Chief Restructuring Officer and commenced a wind-down of its
operations. In connection with its wind-down, the Debtor, in
consultation with its advisors, desired to sell the Real Property.
On June 6, 2016, the Debtor and Signature Associates entered into
the Exclusive Listing Agreement for Sale ("Listing Agreement")
authorizing Signature Associates to act as a broker to sell the
Real Property. Pursuant to the Listing Agreement, the Debtor agreed
to grant to Signature Associates the exclusive right to sell the
Real Property until Dec. 31, 2016, and to pay Signature Associates
a commission of 5% of the aggregate sale price upon the closing of
sale of the Real Property.
In accordance with the Listing Agreement, the Debtor and Signature
Associates solicited offers for the purchase of the Real Property
in the summer of 2016. During the marketing process, the Debtor
received three competing offers for the purchase of the Real
Property; eventually, however, the Debtor accepted the terms of the
offer it received from RosDev Group on July 5, 2016, which offered
a purchase price of $10,100,000. The Debtor determined that the
offer was the highest and best offer it had received for the Real
Property.
RosDev Group, which formed Novi Nine Mile as its purchasing entity,
was also willing and able to close quickly and with the fewest
conditions as compared to other offers the Debtor received.
Furthermore, RosDev Group demonstrated the capacity to close and
its offer did not contain any financing contingencies.
In accordance with the offer, the Debtor and Novi Nine Mile
executed the Purchase Agreement, dated July 30, 2016, detailing the
terms and conditions of the sale of the Real Property.
A copy of the Purchase Agreement attached to the Motion is
available for free at:
http://bankrupt.com/misc/Frank_Kerr_86_Sales.pdf
The material terms of the Purchase Agreement include, but are not
limited to:
a. Novi Nine Mile will purchase the Real Property for
$10,100,000;
b. The Debtor will transfer and assign to Novi Nine Mile all of
the leases related to the Real Property ("Leases");
c. The Debtor will transfer and assign to Novi Nine Mile all of
the Debtor's right, title, and interest in all governmental license
and permits, building, architectural, engineering, mechanical,
electrical, and landscaping surveys, plans, and specifications, and
all transferable warranties and guaranties from manufacturers
relating to the Real Property ("Permits"); and
d. The Debtor will transfer and assign to Novi Nine Mile all of
the Debtor's right in service, utility, supply, maintenance, and
concession contracts, agreements, or other agreements affecting the
operating, maintenance, and repair of the Real Property which Novi
Nine Mile elects to assume ("Contracts").
On Aug. 3, 2016, the Debtor and Novi Nine Mile executed the Escrow
Agreement with First American Title Insurance Co. ("Escrow
Agreement"). Pursuant to the Escrow Agreement and in accordance
with the Purchase Agreement, Novi Nine Mile made a $100,000
purchase price deposit with First American.
On Aug. 22, 2016, the Debtor and Novi Nine Mile executed the First
Amendment to Purchase and Sale Agreement, changing the closing date
to Sept. 26, 2016, and changing the purchase price from $10,100,000
to $9,825,000, among other changes.
On Sept. 15, 2016, the Debtor and Novi Nine Mile executed the
Second Amendment to Purchase and Sale Agreement, which, among other
things: (i) noted the involuntary bankruptcy filed against the
Debtor on Aug. 23, 2016; (ii) required an order from the Court
approving the sale of the Real Property prior to the closing of the
sale, and acknowledged Novi Nine Mile's right to terminate the
Purchase Agreement if such an order is not entered; and (iii)
waived of the due diligence contingencies contained in the Purchase
Agreement.
Pursuant to terms of the Purchase Agreement, the Debtor desires
Court approval to close and finalize the sale of the Real
Property.
The Debtor submits that any such lien or encumbrance will be
adequately protected by either being paid in full at the time of
closing, or attaching to the proceeds of the sale, subject to any
claims and defenses the Debtor may possess with respect thereto.
The Debtor further requests that the order approving the sale
provide that the Contracts, Permits, and Leases will be assigned
to, and remain in full force and effect for the benefit of Novi
Nine Mile, notwithstanding any provisions in the Contracts,
Permits, and Leases, including those described in sections
365(b)(2) and (f)(1) and (3) of the Bankruptcy Code, that prohibit
such assignment. Upon information and belief, the Debtor does not
owe any amount under any current Contract, Permit, or Lease that
may be assigned to Novi Nine Mile.
In order to allow the immediate realization of value for the Real
Property, the Debtor requests that any order grating this Motion is
effective immediately and not subject to the 14-day stay imposed by
Bankruptcy Rules 6004(h) and 6006(d).
The Purchaser is represented by:
Kenneth J. Clarkson, Esq.
JAFFE, RAITT, HEUER & WEISS, P.C.
27777 Franklin Road, Suite 2500
Southfield, MI 48034
E-mail: kclarkson@jaffelaw.com
About Frank W. Kerr Company
Frank W. Kerr Company filed a chapter 7 petition on Aug. 23, 2016.
The Debtor consented to and the Court entered an order for relief
under chapter 11, converting the case to a chapter 11 proceeding
(Bankr. E.D. Mich. Case No. 16-51724) on Sept. 19, 2016.
The Debtor is represented by Stephen M. Gross, Esq. and Jayson B.
Ruff, Esq., at McDonald Hopkins PLC.
The Debtor was founded in 1913 and was one of the largest
independent pharmaceutical wholesalers in the United States,
operating its business from an owned facility in Novi, Michigan.
The Debtor's customers through the years included many local and
national chains, such as Revco, Cunningham Drug, Apex, Kmart,
Arbor, Meijer, Inc., and Sav-Mor Drugs. It provided retail
customers with brand and generic pharmaceuticals, over-the-counter
drugs, private label goods, sundries and promotional programs.
FREEPORT-MCMORAN INC: S&P Lowers CCR to 'BB-'; Outlook Stable
-------------------------------------------------------------
S&P Global Ratings said it lowered its corporate credit rating on
Phoenix-based Freeport-McMoRan Inc. to 'BB-' from 'BB'. The
outlook is stable.
At the same time, S&P lowered the issue-level ratings on the
company's senior unsecured debt to 'BB-' from 'BB'. The recovery
rating on the debt remains '3', indicating S&P's expectation of
meaningful (50% to 70%; upper half of the range) recovery in the
event of a payment default. In addition, S&P lowered its ratings
on the company's preferred stock to 'B' from 'B+'.
"The downgrade reflects an updated view of Freeport's competitive
position, operating efficiency, and scale," said S&P Global Ratings
credit analyst Chiza Vitta. "It also incorporates our view that
despite stagnant credit measures in the first half of 2016, we
anticipate a stronger financial risk profile by year end due to the
company's ongoing efforts to reduce debt."
Freeport continues to sell assets and is focusing on its core
copper business. Asset sale and equity issuance proceeds are being
applied toward repaying debt, which, along with elevated levels of
gold production over the next 24 months, is mitigating the recent
EBITDA decline and supporting leverage levels commensurate with an
aggressive financial risk profile.
S&P could lower the ratings if it believes leverage will remain
above 5x through the end of 2016. This could be the result of
canceled or delayed assets sales or equity issuances. S&P could
also lower the rating if it no longer considered the company's
business risk profile to be satisfactory. This could be the case
if adjusted EBITDA margins are likely to remain below 25%.
S&P could raise the rating if debt to EBITDA is sustained below 4x.
This would most likely be the result of successfully taking steps
toward reaching the $10 billion net debt target by the end of 2017.
S&P could also raise the rating once pending asset sales and
equity issuances are completed and applied toward debt repayment,
removing the related execution uncertainty.
FTE NETWORKS: Appoints Lynn Martin as Chief Operating Officer
-------------------------------------------------------------
FTE Networks, Inc., announced the appointment of Mr. Lynn Martin as
chief operating officer, effective Sept. 27, 2016. As COO, Lynn
Martin will be responsible for the prioritization and alignment of
company initiatives overseeing, developing, and setting the
strategic direction for the day-to-day operations of FTE Networks
and ensuring operational excellence across the company.
"The explosion in data and bandwidth needs is driving radical
shifts in the communications industry and cloud computing,
representing a significant opportunity to transform communications
networks and the way people meet and connect," said Martin. "I
look forward to leveraging FTE's deep expertise in telecom and IT,
providing the tools and processes that propel projects, and
enabling communications providers and enterprises to increase the
agility and efficiency of their networks."
Prior to joining FTE, Lynn was head of the communications,
software, and technology division of Nexius where he was
responsible for growing the business by delivering end-to-end
network solutions for emerging technologies, such as Open
Source/NFV/SDN and infrastructure services that provided relevant
value to customers and helped them to optimize their businesses. In
addition to leading the software and technology teams, he created
several new business offerings in Engineering, Fiber and Open
Source development where he joined efforts with Open Compute
Project and Telecom Infra Project communities both founded by
Facebook to provide new network architectures and solutions with
greater simplicity and efficiency. Before Nexius, Martin served as
executive director of Telcordia Technologies, where he ran the
company's next generation software product line, was a senior
strategist in Accenture's Network Practice, and spent over a decade
at Level 3 Communications at VP of Operational Integration and
Process Management.
"Lynn has proven leadership and deep operating experience that
makes him uniquely qualified to drive strategic prioritization to
further align our business for peak performance," said Mr. Michael
Palleschi, FTE Networks chairman and chief executive officer. "I
have great confidence in his ability to work closely with our
leadership team in order to execute on the company's vision and
strategy, optimize efficiencies, and extend our relationships with
key partners. Lynn has cultivated key relationships in the
technology and communications space that will further expand our
business globally and help develop and launch our managed network
strategy powered by compute to the edge. His longstanding industry
relationships coupled with the emerging market opportunity that is
available to FTE, make him an ideal fit for our Chief Operating
Officer position."
About FTE Networks
FTE Networks, formerly known as Beacon Enterprise Solutions Group,
Inc., is a vertically integrated company with an international
footprint. Since its inception, FTE Networks has steadily
advanced its management, operational and technical capabilities to
become a leading provider of services to the telecommunications
and wireless sector with a focus on turnkey solutions. FTE
Networks provides a comprehensive array of services centered on
quality, efficiency and customer service.
FTE Networks reported a net loss attributable to common
shareholders of $3.63 million on $14.4 million of revenues for the
year ended Sept. 30, 2015, compared to net income of $436,000 on
$16.9 million of revenues for the year ended Sept. 30, 2014.
As of June 30, 2016, FTE Networks had $9.69 million in total
assets, $19.95 million in total liabilities, $437,380 in total
temporary equity, and a total stockholders' deficiency of
$10.7 million.
GAWKER MEDIA: Committee Seeks Court OK to Conduct Discovery
-----------------------------------------------------------
The Official Committee of Unsecured Creditors of Gawker Media LLC
and its debtor-affiliates complains to the U.S. Bankruptcy Court
for the Southern District of New York that the Debtors have been
ignoring its request for production of documents. The Committee
tells the Court that its counsel Simpson Thacher & Bartlett LLP and
financial advisor Deloitte Financial Advisory Services LLP, began
to make informal requests to the Debtors for documents and other
information beginning in June 2016, shortly after the Committee
selected those firms. Instead, the Debtors, through their
advisors Ropes & Gray and Opportune LLC, have repeatedly delayed
providing the requested information to the Committee.
Initially, the Debtors told the Committee that it would have to
wait until the auction on August 16, 2016 before the Debtors could
provide the requested information. However, after the auction was
completed and the sale to Univision approved, the Debtors then took
the position that any responses to the Committee's requests would
have to wait until certain Ropes and Opportune personnel returned
from vacation because they had to "weigh in" on the requests.
Then, once the personnel from Ropes and Opportune returned from
vacation, the Debtors next told the Committee that it would have to
continue to wait until the sale to Univision Communications Inc.
had closed before the Debtors could respond to the Committee's
informal information requests. However, the Univision sale closed
on September 9, 2016, and the Debtors still have provided the
Committee with very little of the information that the Committee
requested.
On Sept. 20, 2016, with the Committee's requests still largely
outstanding, the Debtors informed the Committee that they intended
to seek confirmation of a plan of reorganization (not yet filed or
otherwise shared with the Committee) on a highly expedited
timetable, with a confirmation hearing before the end of the year.
Despite recent representations from the Debtors that they would
provide the Committee with the information it had requested months
earlier, the Debtors claimed that they could not inform the
Committee when it would receive the requested information until
September 26. Finally, on September 26, the Debtors provided a
vague response that "many" of the documents would be available by
the end of the week and that others were being "gathered" but no
deadline was provided.
Accordingly, the Committee asks the Court for authority to conduct
discovery of the Debtors through (a) document requests and (b) a
deposition of a representative or representatives of the Debtors
who is or are most knowledgeable about the matters for examination.
Among others, the Committee seeks permission to issue subpoenas
seeking documents and deposition testimony concerning, among other
things:
(a) the value of Debtors' assets, a matter that is highly
pertinent to the allocation of the sale proceeds between among the
Debtors under any proposed plan of reorganization;
(b) prepetition intercompany transfers and related
intercompany agreements;
(c) prepetition transfers to or on behalf of insiders,
including Nick Denton and what appears to the a Denton family trust
-- Greenmount Creek Limited (f/k/a Gawker Media Limited), including
communications, concerning the June 8, 2016 loan of $200,000 to
Nick Denton, including documents concerning the approval of the
loan and the source of the funding of the loan;
(d) the corporate relationships between and among the Debtors;
and
(e) other matters affecting or concerning the Debtors' assets,
liabilities, and financial condition.
"Based on the Debtors' conduct to date, however, the Committee
fears that absent an Order of this Court the Debtors may continue
to delay the provision of documents and other information to the
Committee that is necessary for the Committee to fulfill its
fiduciary duties and participate meaningfully in the plan
confirmation process," the Committee says.
The Committee's counsel, Simpson Thacher, can be reached at:
Sandeep Qusba, Esq.
William T. Russell, Jr., Esq.
SIMPSON THACHER & BARTLETT LLP
425 Lexington Avenue
New York, NY 10017
Tel: 212-455-2000
Fax: 212-455-2502
E-mail: squsba@stblaw.com
wrussell@stblaw.com
About Gawker Media
Founded in 2002 by Nick Denton, Gawker Media is privately held
online media company operating seven distinct media brands with
corresponding websites under the names Gawker, Deadspin,
Lifehacker, Gizmodo, Kotaku, Jalopnik, and Jezebel. The Company's
various Websites cover, among other things, news and commentary on
current events, politics, pop culture, sports, cars, fashion,
productivity, technology and video games.
Gawker sought bankruptcy protection after being ordered to pay
$140.1 million in connection with an invasion of privacy lawsuit
arising from publication of a report and commentary and
accompanying sex video involving Terry Gene Bollea.
New York-based Gawker Media, LLC -- fdba Gawker Sales, LLC, Gawker
Entertainment, LLC, Gawker Technology, LLC and Blogwire, Inc. --
filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No.
16-11700) on June 10, 2016. The Hon. Stuart M. Bernstein presides
over the Debtors' cases.
Affiliates Gawker Media Group, Inc. and Budapest, Hungary-based
Kinja, Kft. filed separate Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 16-11719 and 16-11718) on June 12, 2016. The cases are
jointly administered.
Gregg M. Galardi, Esq., David B. Hennes, Esq. and Michael S.
Winograd, Esq., at Ropes & Gray LLP serve as counsel to the
Debtors. William Holden at Opportune LLP serves as Gawkers' chief
restructuring officer. Houlihan Lokey Capital, Inc. serves as the
Debtors' investment banker. Prime Clerk LLC serves as claims,
balloting and administrative agent. Akin Gump Strauss Hauer & Feld
LLP serves as special counsel to the Special Committee of the
Company's Board.
The Debtors estimated $50 million to $100 million in assets and
$100 million to $500 million in liabilities.
The U.S. trustee for Region 2 appointed three creditors of Gawker
Media LLC and its affiliates to serve on the official committee of
unsecured creditors. The committee members are Terry Gene Bollea,
popularly known as Hulk Hogan, Shiva Ayyadurai, and Ashley A.
Terrill. The Committee retained Simpson Thacher & Bartlett LLP as
counsel, Cayman Island-based Mourant Ozannes as its special
counsel, and Deloitte Financial Advisory Services LLP as financial
advisor.
Counsel to US VC Partners LP, as Prepetition Second Lien Lender,
are David Heller, Esq., and Keith A. Simon, Esq., at Latham &
Watkins LLP.
Counsel to Cerberus Business Finance, LLC, as DIP Lender, are Adam
C. Harris, Esq., at Schulte Roth & Zabel LLP.
An auction of the Debtors' assets was held on August 16, 2016. The
stalking horse, an affiliate of Ziff Davis, LLC, entered the
auction with a $90 million offer. At the conclusion of the auction,
the Debtors designated the $135 million offer from UniModa LLC, a
wholly-owned subsidiary of Univision Communications Inc., as the
successful bid. On Aug. 22, the Court entered an order authorizing
the sale of the Debtors' assets to Univision. The sale closed on
Sept. 9.
GAWKER MEDIA: Creditors Seek Access to Books, Depose Founder
------------------------------------------------------------
Tom Corrigan, writing for The Wall Street Journal Pro Bankruptcy,
reported that creditors of Gawker Media have asked the U.S.
Bankruptcy Judge in New York for permission to investigate the
transactions conducted by the online-media company before its
bankruptcy filing in June.
According to the report, citing papers filed in bankruptcy court,
Gawker's creditors are seeking court approval to subpoena the
company's books and question founder Nick Denton and other company
insiders under oath.
In the court papers the creditors said they want more information
about assets transfers to what they said appears to be Mr. Denton's
family trust, the report related. Creditors say they learned of
these transfers through a review of public records and through
documents Gawker has already provided, the report further related.
In the filing, Gawker's creditors said a probe is needed to
determine if any of the company's actions before bankruptcy could
serve as grounds for lawsuits to recover more money, the report
said. Also, such litigation can give creditors greater leverage in
negotiating settlements, the report noted.
About Gawker Media
Founded in 2002 by Nick Denton, Gawker Media is privately held
online media company operating seven distinct media brands with
corresponding websites under the names Gawker, Deadspin,
Lifehacker, Gizmodo, Kotaku, Jalopnik, and Jezebel. The Company's
various Websites cover, among other things, news and commentary on
current events, politics, pop culture, sports, cars, fashion,
productivity, technology and video games.
Gawker sought bankruptcy protection after being ordered to pay
$140.1 million in connection with an invasion of privacy lawsuit
arising from publication of a report and commentary and
accompanying sex video involving Terry Gene Bollea.
New York-based Gawker Media, LLC -- fdba Gawker Sales, LLC, Gawker
Entertainment, LLC, Gawker Technology, LLC and Blogwire, Inc. --
filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No.
16-11700) on June 10, 2016. The Hon. Stuart M. Bernstein presides
over the Debtors' cases.
Affiliates Gawker Media Group, Inc. and Budapest, Hungary-based
Kinja, Kft. filed separate Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 16-11719 and 16-11718) on June 12, 2016. The cases are
jointly administered.
Gregg M. Galardi, Esq., David B. Hennes, Esq. and Michael S.
Winograd, Esq., at Ropes & Gray LLP serve as counsel to the
Debtors. William Holden at Opportune LLP serves as Gawkers' chief
restructuring officer. Houlihan Lokey Capital, Inc. serves as the
Debtors' investment banker. Prime Clerk LLC serves as claims,
balloting and administrative agent.
The Debtors estimated $50 million to $100 million in assets and
$100 million to $500 million in liabilities.
The U.S. trustee for Region 2 on June 24 appointed three creditors
of Gawker Media LLC and its affiliates to serve on the official
committee of unsecured creditors. The committee members are Terry
Gene Bollea, popularly known as Hulk Hogan, Shiva Ayyadurai, and
Ashley A. Terrill. The Committee retained Simpson Thacher &
Bartlett LLP, in New York, as counsel.
Counsel to US VC Partners LP, as Prepetition Second Lien Lender,
are David Heller, Esq., and Keith A. Simon, Esq., at Latham &
Watkins LLP.
Counsel to Cerberus Business Finance, LLC, as DIP Lender, are Adam
C. Harris, Esq., at Schulte Roth & Zabel LLP.
GEI HOLDINGS: Sale of Three New Jersey Properties Approved
----------------------------------------------------------
Judge John K. Sherwood of the U.S. Bankruptcy Court for the
District of New Jersey authorized GEI Holdings, LLC to sell its
properties located at 137-139 Carolina Ave, Irvington, New Jersey,
to David J. Tucker for $249,000; at 229 Columbia Avenue, Irvington,
New Jersey, to Jamal Hawkins for $249,000; and at 140-142
Huntington Terrace, Newark, New Hersey, to Linda Gindi for
$285,000.
At closing, Wilmington Trust will provide a letter advising the
third-party purchaser that its lien will attach to the sale
proceeds.
The proceeds of the sale must be used to satisfy Wilmington Trust's
lien on the real property, unless it is otherwise avoided by Court
Order. Until such satisfaction, the property is not free and clear
of the lien and the sale will not be valid.
The amount claimed as exempt may be paid to the Debtor.
A copy of the HUD settlement statement must be forwarded to
Wilmington Trust at least a day before the sale closes.
A separate application for the retention of professionals and for
fees and costs incurred by the Debtor in the sale of the real
property must be filed.
All rents having been utilized by the Debtor during the pendency of
the bankruptcy, to which Wilmington Trust was legally entitled,
must be accounted for by the Debtor and the accounting provided to
Wilmington Trust.
All rents collected from Sept. 13, 2016 onward will be turned over
to Wilmington Trust (minus agreed upon tax, insurance and property
maintenance expenses) immediately and on an ongoing basis.
About GEI Holdings
GEI Holdings, LLC, sought Chapter 11 protection (Bankr. D.N.J. Case
No. 16-24991) on Aug. 4, 2016, disclosing under $1 million in both
assets and liabilities. The Debtor is represented by John F. Wise,
Esq., at Goodson Law Offices, LLC. No official committee of
unsecured creditors has been appointed in the case.
GERALD DEVER: To Pay Unsecureds in 60 Months Under Plan
-------------------------------------------------------
Gerald Patrick Dever filed with the U.S. Bankruptcy Court for the
District of Maryland a Plan of Reorganization and Disclosure
Statement, which proposes to pay unsecured claims over a 60-month
period.
The Disclosure Statement relates that unsecured claims of Portfolio
Recovery Associates and AAS Debt Recovery Inc. are unimpaired;
while the unsecured claims of Sosnoski Associates, Timco Ltd., and
Jerry Thompson are impaired. The claim amounts range from $500 to
$150,000.
The Debtor is presently employed by and a part owner of BG
Petroleum LLC. BG Petroleum is a fully integrated oil distributor
and retailer for Exxon and Sunoco. Difficulties that BG Petroleum
encountered in its business also affected the Debtor's finances,
and prompted him to file for bankruptcy.
The Disclosure Statement reveals that BG Petroleum's business has
improved since then and the Debtor's pay has increased and will be
constant rather than intermittent. Given these improvements, the
Debtor is confident he will have the resources to pay his
creditors.
A full-text copy of the Disclosure Statement dated Sept. 16, 2016
is available at http://bankrupt.com/misc/mdb16-13325-31.pdf
Counsel to Gerald Dever is:
Michael Coyle
The Coyle Law Group
6700 Alexander Bell Drive, Ste 200
Columbia, MD 21046
Tel: 410-884-3180, 410-884-3181
E-mail: mcoyle@thecoylelawgroup.com
Gerald Patrick Dever sought bankruptcy protection (Bankr. D. Md.
Case No. 16-13325) on March 15, 2016.
GOLDEN MARINA: Wants Plan Filing Period Extended to Dec. 6
----------------------------------------------------------
Golden Marina Causeway LLC asks the U.S. Bankruptcy Court for the
Northern District of Illinois to extend its exclusive periods to
file a plan and disclosure statement and solicit acceptances to the
plan to December 6, 2016 and February 7, 2016, respectively.
The Debtor relates that it is in the midst of pursuing the sale of
its major asset, which is a 46-acre parcel of real estate in
downtown Milwaukee. The Debtor further relates that the deadline
set by the Court to file the plan and disclosure statement is fast
approaching, and the exclusivity period will expire too.
The Debtor's eexclusive period to file its plan and disclosure
statement will expire on October 4, 2016.
The Debtor contends that in order for it to complete the sale
process prior to the plan process, it needs a two-month extension
of the exclusivity periods and the deadline to file its plan and
disclosure statement without prejudice to further extensions .
The Debtor's Motion is scheduled for hearing on October 4, 2016 at
9:30 a.m.
About Golden Marina Causeway LLC
Golden Marina Causeway LLC owns two parcels of real estate, located
at 302 and 311 East Greenfield Avenue in Milwaukee, Wisconsin. The
parcel at 311 E. Greenfield consists of 47 acres and the smaller
parcel at 302 E. Greenfield is approximately 1 acre.
Lawrence D. Fromelius filed a Chapter 11 petition (Bankr. N.D. Ill.
Case No. 15-22373) on June 29, 2015. On July 2, 2015, L. Fromelius
Investment Properties LLC filed a petition for relief under Chapter
11 of the Bankruptcy Code under Case No. 15-22943, and on Feb. 5,
2016, Golden Marina Causeway LLC filed for relief under Chapter 11,
under Case No. 16-03587.
Mr. Fromelius is the sole member of Investment Properties. He is
also the sale member of East Greenfield Investors LLC, which in
turn is the sole member of Golden Marina Causeway LLC.
GOLFSMITH INTERNATIONAL: UST Wants Consumer Privacy Ombudsman
-------------------------------------------------------------
Andrew R. Vara, the Acting United States Trustee for Region 3,
objects to the request of Golfsmith International Inc., for
approval of bidding procedures to sell substantially all of their
assets. The Motion, according to Mr. Vara, does not provide
sufficient information for the U.S. Trustee to determine whether a
consumer privacy ombudsman needs to be appointed to protect
personally identifiable information about individuals.
He tells the Court, "It is the understanding of the U.S. Trustee
that the Debtors' privacy policy does not permit the transfer of
individual phone numbers, or the sale of individual email
addresses, unless certain exceptions are met. Accordingly, it
appears that appointment of a consumer privacy ombudsman is
necessary. The U.S. Trustee requests that the Debtors confirm that
it is the Debtors' intent to address any and all issues related to
consumer privacy under Section 363(b)(1) in any subsequent order
seeking approval of a sale under the sale procedures."
Information on the planned auction and sale of the Debtors' assets
were reported in the Sept. 22 edition of the Troubled Company
Reporter.
A hearing on the Debtors' Motion is set for Oct. 5, 2016 at 1:30
p.m.
About Golfsmith International
Headquartered in Austin, Texas, Golfsmith International Holdings,
Inc., the parent company of Golfsmith International, Inc., is a
holding company. The Company is a specialty retailer of golf and
tennis equipment, apparel, footwear and accessories. The Company
operates as an integrated multi-channel retailer, providing its
customers the convenience of shopping in the retail stores across
United States, through its Internet site,
http://www.golfsmith.com/,and from its catalogs. The Company
offers a product selection that features national brands,
pre-owned
clubs and its branded products. It offers a number of customer
services and customer care initiatives, including its club
trade-in
program, 30-day playability guarantee, 115% low-price guarantee,
its credit card, in-store golf lessons, and SmartFit, its
club-fitting program. As of January 1, 2011, the Company operated
75 stores in 21 states and 33 markets.
Golfsmith International Holdings, Inc., and its 12 debtor
affiliates filed Chapter 11 petitions (Bankr. D. Del. Case No.
16-12033) on Sept. 14, 2016, and are represented by Mark D.
Collins, Esq., John H. Knight, Esq., Zachary I. Shapiro, Esq., and
Brett M. Haywood, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware; and Michael F. Walsh, Esq., David N.
Griffiths, Esq., and Charles M. Persons, Esq., at Weil, Gotshal &
Manges LLP, in New York.
The Debtors' financial advisor is Alvarez & Marsal North America,
LLC. The Debtors' investment banker is Jefferies LLC. The
Debtors' claims, noticing and solicitation agent is Prime Clerk
LLC.
At the time of filing, the Debtor had $100 million to $500 million
in estimated assets and $100 million to $500 million in estimated
liabilities.
Andrew Vara, acting U.S. trustee for Region 3, on Sept. 23, 2016,
appointed seven creditors to serve on the official committee of
unsecured creditors.
HAWTHORNE FAMILY FARMS: Hearing on Bankruptcy Plan Set for Nov. 2
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana will
consider approval of the Chapter 11 plan of Hawthorne Family Farms,
Inc. at a hearing on November 2.
The hearing will be held at 10:00 a.m., at Room 103, Federal
Building, 121 W. Spring Street, New Albany, Indiana.
The court had earlier approved Hawthorne's disclosure statement,
allowing it to start soliciting votes from creditors.
The order set an October 21 deadline for creditors to cast their
votes and file their objections.
About Hawthorne Family Farms
Hawthorne Family Farms, Inc., is a family farm that's into grain
production. The farm started with 133 acres during its founding in
1956, grew to 600 acres by 1981, and grew by 350 acres since 2010.
Founder Joe Hawthorne owns 84% and his son Jon owns the remaining
16%.
On March 7, 2016, Hawthorne Family Farms, Inc., filed a voluntary
Chapter 12 petition for relief (Bankr. S.D. Ind. Case No.
16-70180). On April 7, 2016, the Debtor filed its motion to
convert to a proceeding under Chapter 11 due to it being ineligible
for a Chapter 12 due to the debt limits of a Chapter 12. On May 2,
2016, the Court entered its order converting the case to Chapter
11.
The Debtor is represented by David R. Krebs, Esq., at Tucker Hester
Baker & Krebs, LLC, in Indianapolis, Indiana.
HERCULES OFFSHORE: Judge Wants Parties to Resume Negotiations
-------------------------------------------------------------
Jeff Montgomery, writing for Bankruptcy Law360, reported that
Delaware Bankruptcy Judge Kevin Carey on Tuesday closed out the
contested Plan confirmation hearing and trial on Hercules Offshore
Inc.'s Chapter 11 Plan. Judge Carey suggested that the
parties-in-interest in the case resume settlement talks. The Plan
is repeatedly being attacked by stockholders as the unfair product
of a suspicious business failure, the report added.
The trial began Thursday last week. The report said Judge Carey
closed out the hearing without making an immediate confirmation
decision or hearing final arguments. Instead, the judge held a
private, 15-minute meeting with attorneys for the company, lenders,
creditors and stockholders who participated in earlier efforts to
reach a compromise.
According to a report by the Troubled Company Reporter on Sept. 20,
2016, Jacqueline Palank, writing for The Wall Street Journal Pro
Bankruptcy, said Hercules Offshore sweetened shareholders' payout
in its bankruptcy after a battle led by distressed investor
Centerbridge Partners. The Company on Sept. 15, submitted an
amended debt-payment plan that offers a cash payout of $15 million
to shareholders who rejected a previous plan.
Depending on the success of the sales of Hercules' rigs and other
assets, however, shareholder recoveries could rise as high as $138
million, the WSJ report said, citing an analysis by Hercules
investment bankers at PJT Partners.
A prior analysis of potential asset sale outcomes by PJT had
forecast a shareholder recovery of $0 to $27 million, the WSJ
report added, citing court papers.
Led by Centerbridge, shareholders teamed up to oppose a plan they
said would give Hercules senior lenders a "massive windfall" in the
company's second chapter 11 filing in as many years, the WSJ report
related.
Court papers show mediation led by U.S. Bankruptcy Court Judge
Christopher Sontchi produced a settlement in which lenders agreed
to reduce about $546 million in claims by $32.5 million, the report
further related. The deal also includes a pledge from the lenders
to allow the shareholders to receive the $15 million in cash before
the lenders are paid, the report said.
About Hercules Offshore
Hercules Offshore, Inc., and its debtor and non-debtor subsidiaries
are providers of shallow-water drilling and marine services to the
oil and natural gas exploration and production industry globally.
Hercules Offshore and 13 of its subsidiaries each filed a Chapter
11 bankruptcy petition (Bankr. D. Del. Proposed Lead Case No.
16-11385) on June 5, 2016. The petition was signed by Troy L.
Carson as vice president.
The Debtors listed total assets of $1.06 billion and total debts of
$521.37 million as of March 31, 2016.
The Debtors have hired Akin Gump Srauss Hauer & Feld LLP as general
bankruptcy counsel and Morris, Nichols, Arsht & Tunnell LLP as
co-counsel.
The U.S. Bankruptcy Court issued an order appointing Judge
Christopher Sontchi as mediator to govern mediation procedures and
assist in resolving certain objections related to confirmation of
Hercules Offshore's Joint Prepackaged Chapter 11 Plan of
Reorganization.
On June 20, 2016, the U.S. Trustee for the District of Delaware
appointed three members to the Equity Committee. The Equity
Committee is represented by Hogan McDaniel and Kasowitz, Benson,
Torres & Friedman LLP as co-counsel and Ducera Securities LLC as
financial advisors.
Kirkland & Ellis LLP and Kirkland & Ellis International LLP, White
& Case LLP and Klehr Harrison Harvey Branzburg LLP represent an ad
hoc group of certain first lien lenders party to that certain
credit agreement, dated as of Nov. 6, 2015, by and among Hercules
Offshore, Inc., as borrower, the Subsidiary Guarantors as
guarantors, the lenders party thereto, and Jefferies Finance LLC,
as administrative agent and collateral agent, as creditors and
parties-in-interest in the Debtors' Chapter 11 cases.
HESTER CONSTRUCTION: Oct. 12 Plan, Disclosures Hearing
------------------------------------------------------
The Hon. Austin E. Carter of the U.S. Bankruptcy Court for the
Middle District of Georgia has granted conditional approval to
Hester Construction, LLC's disclosure statement dated Sept. 7,
2016, describing the Debtor's plan of reorganization dated Sept. 7,
2016.
The final hearing to consider the adequacy of the Disclosure
Statement and the confirmation of the Plan will be held on Oct. 12,
2016, at 2:00 p.m. Objections to the Disclosure Statement and the
confirmation of the Plan must be filed by Oct. 6, 2016.
Oct. 6, 2016, is the last day for filing written acceptances or
rejections of the Plan.
Hester Construction, LLC, filed for Chapter 11 bankruptcy
protection (Bankr. M.D. Ga. Case No. 15-11512) on Nov. 12, 2015.
Kenneth W. Revell, Esq., at Zalkin Revell, PLLC, serves as the
Debtor's bankruptcy counsel.
HEYL & PATTERSON: Committee May File Own Plan, Court Says
---------------------------------------------------------
Judge Carlotta M. Bohm of the U.S. Bankruptcy Court for the Western
District of Pennsylvania extended Heyl & Patterson, Inc.'s
exclusive periods to file a chapter 11 plan and solicit votes on
the plan to December 29, 2016 and March 1, 2017, respectively.
Judge Bohm granted the Official Committee of Unsecured Creditors
the right to break exclusivity on its behalf alone, upon the filing
of a notice with the Court, advising the Court that the Unsecured
Creditors Committee has determined that breaking exclusivity is in
the best interest of the Bankruptcy Estate.
The Debtor previously sought the extension of its exclusive
periods, contending that its reorganization process is not a simple
endeavor and that since the Petition Date, a number of
contingencies have arisen that substantially affect the Debtor's
reorganization, which are too far unresolved to allow the Debtor to
propose a plan of reorganization that accurately states how certain
claims and interests can and will be treated.
The Debtor told the Court that these contingencies include: (a)
finding adequate funding to fully realize the Debtor's business
opportunities; (b) finding and procuring contracts for new
business; (c) the potential for a sale of the leasehold premises
which could result in payment of an intercompany loan providing
significant liquidity; and (d) the consideration of the possible
sale of some or all of the Debtor's assets.
About Heyl & Patterson, Inc.
Heyl & Patterson Inc. is an American specialist engineering
company, founded in 1887 and based in Pittsburgh, Pennsylvania.
Heyl & Patterson sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case No. 16-21620) on April 29,
2016. The petition was signed by John R. Edelman, CEO. The case
is assigned to Judge Carlota M. Bohm. The Debtor estimated both
assets and liabilities in the range of $1 million to $10 million.
The Debtor is represented by George T. Snyder, Esq., at Stonecipher
Law Firm. The Debtor hired Gleason & Associates as their financial
advisors.
Andrew Vara, acting U.S. trustee for Region 3, on May 31 appointed
seven creditors of Heyl & Patterson, Inc., to serve on the official
committee of unsecured creditors. The Committee retained
Whiteford, Taylor & Preston, LLC as its legal counsel; and Albert's
Capital Services, LLC as its financial advisor.
HIDALGO COUNTY: S&P Lowers Rating on $26.7MM Bonds to 'CCC'
-----------------------------------------------------------
S&P Global Ratings lowered its long-term rating to 'CCC' from 'B-'
on the Hidalgo County Health Services Corp., Texas' $26.7 million
combined series 2005, 2007, and 2008 bonds, issued for Mission
Regional Medical Center (Mission) and placed the rating on
CreditWatch with negative implications.
"The CreditWatch placement reflects the recent notification from
Financial Resources Group LLC (FRG), the required management
consultants, that Mission will not be able to find enough savings
to offset the loss of its supplemental payments," said S&P Global
Ratings credit analyst Kevin Holloran. This will require that
Mission enter into a Letter of Intent (LOI) with Doctors Hospital
at Renaissance (DHR), combined with the release of Mission's
third-quarter financial results (unaudited nine-month results
through June 30, 2016) that show continued losses as generally
outlined in the FRG notification.
Earlier this year, S&P Global lowered its rating on Mission to
'B-'.
HME HOLDINGS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: HME Holdings, Inc.
Rexco Industrial Park #150
Calle C, Esq. Calle B, Carr. 165
Guaynabo, PR 00968
Case No.: 16-07686
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Carmen D Conde Torres, Esq.
C. CONDE & ASSOCIATES
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: 787-729-2900
Fax: 787-729-2203
E-mail: condecarmen@condelaw.com
- and -
Luisa S Valle Castro, Esq.
C. CONDE & ASSOCIATES
254 Calle San Jose 5th Floor
San Juan, PR 00901-1523
Tel: 787 729-2900
E-mail: notices@condelaw.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ivan Marin, authorized representative.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/prb16-07686.pdf
HOSTESS BRANDS: Court Dismisses Suit vs. Bread Depo
---------------------------------------------------
In the case captioned OLD HB, INC. F/K/A HOSTESS BRANDS INC.,
Plaintiff, v. BREAD DEPO OF NEW YORK INC., Defendant, Docket No.
502918/14, Motion Seq. No. 4-5, 2016 NY Slip Op 31701(U), Judge
Genine D. Edwards of the Supreme Court, Kings County, denied the
plaintiff's summary judgment motion in its entirety; granted the
defendants's cross-motion to dismiss the complaint; and, dismissed
the action.
Plaintiff, Old HB, Inc., moves for summary judgment to recover a
debt for goods sold and shipped to the defendant over several
months in 2012. The Defendant cross-moves to dismiss the
complaint. The complaint alleges that the defendant owes plaintiff
for goods sold and accepted and/or for work, labor and services
performed for and accepted by the defendant. The complaint further
alleges that an account was established between the plaintiff and
the defendant and that the defendant owes the plaintiff an unpaid
balance. The Defendant interposed a July 6, 2015, verified answer,
including two affirmative defenses; failure to state a cause of
action and lack of capacity to sue.
The November 12, 2015 order approved the asset sale pursuant to the
terms of the Purchase Agreement, and the November 25, 2015 and
December 12, 2015 orders that U.S. Bankruptcy Judge Robert Drain
issued authorized the plaintiff's corporate dissolution, specified
that the dissolution would then terminate the plaintiff's ability
to prosecute and defend lawsuits and dismissed plaintiff's Chapter
11 case.
According to Judge Edwards, the Purchase Agreement is dispositive
of whether the plaintiff may maintain this action, and the
plaintiff has failed to present any indicia of its legal capacity
to sue. The Plaintiff may have held such capacity at the time it
filed the summons and complaint but lost the entitlement to collect
on the debt at issue through the subsequent Bankruptcy Court
orders, the judge said. The Plaintiff's legal right has thus
ceased, and this conclusion moots considering defendant's other
argument for dismissing the complaint, the judge held.
A full-text copy of the Decision, Order and Judgment dated
September 12, 2016 is available at https://is.gd/T7ZjX0 from
Leagle.com.
About Hostess Brands
Founded in 1930, Irving, Texas-based Hostess Brands Inc., is known
for iconic brands such as Butternut, Ding Dongs, Dolly Madison,
Drake's, Home Pride, Ho Hos, Hostess, Merita, Nature's Pride,
Twinkies and Wonder. Hostess has 36 bakeries, 565 distribution
centers and 570 outlets in 49 states.
Hostess filed for Chapter 11 bankruptcy protection early morning
on Jan. 11, 2011 (Bankr. S.D.N.Y. Case Nos. 12-22051 through
12-22056) in White Plains, New York. Hostess Brands disclosed
assets of $982 million and liabilities of $1.43 billion as of the
Chapter 11 filing.
The bankruptcy filing was made two years after predecessors
Interstate Bakeries Corp. and its affiliates emerged from
bankruptcy (Bankr. W.D. Mo. Case No. 04-45814).
In the new Chapter 11 case, Hostess has hired Jones Day as
bankruptcy counsel; Stinson Morrison Hecker LLP as general
corporate counsel and conflicts counsel; Perella Weinberg Partners
LP as investment bankers, FTI Consulting, Inc. to provide an
interim treasurer and additional personnel for the Debtors, and
Kurtzman Carson Consultants LLC as administrative agent.
Matthew Feldman, Esq., at Willkie Farr & Gallagher, and Harry
Wilson, the head of turnaround and restructuring firm MAEVA
Advisors, are representing the Teamsters union.
Attorneys for The Bakery, Confectionery, Tobacco Workers and Grain
Millers International Union and Bakery & Confectionery Union &
Industry International Pension Fund are Jeffrey R. Freund, Esq.,
at Bredhoff & Kaiser, P.L.L.C.; and Ancela R. Nastasi, Esq., David
A. Rosenzweig, Esq., and Camisha L. Simmons, Esq., at Fulbright &
Jaworski L.L.P.
The official committee of unsecured creditors selected New York
law firm Kramer Levin Naftalis & Frankel LLP as its counsel. Tom
Mayer and Ken Eckstein head the legal team for the committee.
Hostess Brands in mid-November 2012 opted to pursue the orderly
wind down of its business and sale of its assets after the Bakery,
Confectionery, Tobacco and Grain Millers Union (BCTGM) commenced a
nationwide strike. The Debtor failed to reach an agreement with
BCTGM on contract changes.
Hostess Brands sold its businesses and most of the plants to five
different buyers for an aggregate of $860 million. Hostess still
has some plants, depots and other facilities the buyers didn't
acquire.
The bankruptcy estate has changed its name to Old HB Inc.
HOUSTON AMERICAN: Remains Noncompliant with NYSE's Listing Rules
----------------------------------------------------------------
Houston American Energy Corp. announced receipt, on Sept. 26, 2016,
of notification from NYSE Regulation that the Company continues to
be in non-compliance with the NYSE MKT's continued listing
standards and that the listing of the Company's common stock was
being continued pursuant to an extension.
The notification cited continued failure to comply with Section
1003(a)(iii) of the NYSE MKT Company Guide as a result of the
Company's failure to maintain stockholders' equity of at least $6
million coupled with reported net losses in its five most recent
fiscal years. The notification also cited failure to comply with
Section 1003(f)(v) of the Company Guide as a result of the
continued trading of the Company's common stock at a low price.
As previously reported in a Current Report on Form 8-K filed on
March 22, 2016, the Company was previously notified by NYSE MKT
that the Company's continued listing was predicated on either
affecting a reverse stock split or otherwise demonstrating
sustained price improvement no later than Sept. 19, 2016. The
notification reflects the determination by NYSE Regulation that the
Company failed to demonstrate sustained price improvement, through
a reverse split or otherwise, by the Sept. 19, 2016, deadline.
Pursuant to the most recent notification, NYSE Regulation has
granted to the Company an extension to the cure period with respect
to its stock price through Jan. 3, 2017. If the Company is not in
compliance with the continued listing standards by Jan. 3, 2017, or
if it does not make progress consistent with the plan in the
interim, the NYSE Regulation staff may initiate delisting
proceedings as appropriate.
The NYSE MKT notice has no immediate impact on the listing of the
Company's common stock, which will, while the Company attempts to
regain compliance with the NYSE MKT listing standards and subject
to periodic review by NYSE Regulation, continue to trade on the
NYSE MKT under the symbol "HUSA," with the added designation of
".BC" to indicate that the Company is not in compliance with the
NYSE MKT's listing standards.
About Houston American Energy Corp.
Based in Houston, Texas, Houston American Energy Corp. is a
publicly-traded independent energy company with interests in oil
and natural gas wells, minerals and prospects. The Company's
business strategy includes a property mix of producing and
non-producing assets with a focus on Texas, Louisiana and
Colombia.
For additional information, view the Company's Web site at
http://www.HoustonAmericanEnergy.com/or contact the Houston
American Energy Corp. at (713) 222-6966.
As of June 30, 2016, the Company had $4.69 million in total assets,
$58,488 in total liabilities and $4.63 million in total
shareholders' equity. Houston American reported a net loss of
$3.83 million in 2015 following a net loss of $4.35 million in
2014.
GBH CPAs, PC, in Houston, Texas, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Dec. 31, 2015, citing that the Company has suffered recurring
losses from operations, which raises substantial doubt about its
ability to continue as a going concern.
HRG GROUP: S&P Affirms 'B' CCR; Outlook Remains Stable
------------------------------------------------------
S&P Global Ratings said that it affirmed its 'B' corporate credit
rating on New York-based HRG Group Inc. The outlook remains
stable.
S&P also raised its rating on HRG's $864.4 million senior secured
notes to 'BB-' from 'B+' and revised the recovery rating to '1',
indicating that creditors could expect very high (90%-100%)
recovery in the event of a payment default, from '2'. At the same
time, S&P raised its rating on HRG's $890 million senior unsecured
notes to 'B-' from 'CCC+' and revised S&P's recovery rating to '5',
indicating that creditors could expect modest (at the high end of
the 10%-30% range) recovery in the event of a payment default, from
'6'.
HRG's debt outstanding as of June 30, 2016 was $1.75 billion.
The affirmation incorporates the assumption that HRG will sell FGL,
realizing gross proceeds of about $1.3 billion, and use the net
proceeds for material debt reduction. However, S&P believes HRG
will likely use a portion of the funds to invest in new companies
and sectors, such that loan-to-value (LTV) can return to the 35%
area, in line with rating expectations.
S&P's ratings on HRG partly reflect the investment holding
company's weak asset diversity, which will temporarily worsen
following the anticipated FGL sale, when Spectrum Brands Holdings
Inc. (lead borrower Spectrum Brands Inc. rated BB-/Stable/--) will
constitute, on a pro forma basis, over 90% of the portfolio value.
S&P's ratings also reflect HRG's inconsistent track record with
respect to investment performance and return. Although HRG's
investments in both Spectrum Brands and FGL (both of which were
five to six years ago) have been very successful, its investment
performance over the last three years has been poor, including
large losses in the oil and gas sector, RadioShack, and, to a
lesser extent, Frederick's of Hollywood.
S&P has factored into the ratings its assumption that HRG will
meaningfully reduce debt with proceeds from the FGL sale but that
this reduction will only be temporary given the nature of its
business, which is to make investments in companies partly with
debt financing. S&P expects HRG to eventually redeploy excess cash
from the FGL sale and potentially add debt to expand into new
companies. Nevertheless, pro forma for the FGL sale, S&P estimates
the LTV ratio (net of cash) will improve meaningfully to about 10%
from about 30% presently. However, cash flow adequacy (dividends
from portfolio companies to interest expense and holding-company
expenses) will remain below 0.5x, which S&P views as weak. S&P
also assumes the FGL sale will result in initial temporary
improvement in cash, potentially doubling from the roughly $210
million reported as of June 30, 2016.
S&P's ratings also incorporate HRG's historical avoidance of
excessive debt usage to fund its portfolio, typically resulting in
an LTV of about 35%.
There is uncertainty related to future potential changes to HRG's
ownership structure, specifically the expiration earlier this year
of the standstill agreement with investment holding company
Leucadia National Corp., which, as its largest shareholder, owns
over 23% of HRG. It's not clear at this point whether Leucadia
will increase its investment in HRG and how it could affect HRG's
strategies and financial policy.
S&P forecasts the company will remain in compliance with its
financial maintenance covenants over the next year.
The stable outlook reflects S&P's expectation that--notwithstanding
regulatory delays--the FGL sale will close and that HRG will use a
substantial amount of the proceeds for debt repayment and at least
temporary liquidity enhancement. S&P estimates LTV will be about
10% and cash flow adequacy will be below 0.5x pro forma for the
transaction. However, if FGL is sold, S&P would expect HRG to
redeploy capital and add debt to invest in new companies and
verticals, such that the LTV would return to the 35% area, which
S&P views as HRG's target.
Downside scenario
S&P could lower the rating if HRG's financial policy becomes more
aggressive, such that debt increases materially to finance
shareholder distributions or leveraged acquisitions, or if there
are investments in new portfolio companies that perform poorly
resulting in weaker asset coverage, deteriorating liquidity, and
continued weak dividend coverage of holding-company expenses. S&P
could also lower the rating if Spectrum Brands' stock price drops
significantly and causes a material deterioration in LTV, if the
FGL sale fails to close, or if HRG fails to diversify its portfolio
into at least three companies across different sectors over the
near to medium term. The latter would result in a non-diversified,
deeply subordinated position compared to Spectrum Brand's company
creditors and would rely on subordinated and discretionary dividend
payments from the investee company.
Upside scenario
S&P could raise the rating if HRG successfully diversifies its
portfolio, including investing in new companies, resulting in
dividend coverage of holding company expenses sustained near 1x and
LTV maintained below 30%.
HTY INC: Voluntary Chapter 11 Case Summary
------------------------------------------
Debtor: HTY, Inc.
1300 Van Buren Avenue, Suite 112
Oxford, MS 38655
Case No.: 16-13370
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Northern District of Mississippi (Aberdeen)
Debtor's Counsel: Craig M. Geno, Esq.
LAW OFFICES OF CRAIG M. GENO, PLLC
587 Highland Colony Parkway
Ridgeland, MS 39157
Tel: 601-427-0048
E-mail: cmgeno@cmgenolaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Nathan Yow, president.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/msnb16-13370.pdf
ICE THEATERS: Gets Court Approval of Liquidating Plan
-----------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois on
Sept. 20 approved the Chapter 11 liquidating plan of Ice Theaters,
LLC.
The court gave the thumbs-up to the plan after finding that it
complied with the requirements for confirmation under the
Bankruptcy Code.
In the same filing, the court also gave final approval to Ice
Theaters' disclosure statement, which it conditionally approved on
July 26.
The plan calls for liquidation of properties owned by the company
and proposes to use the proceeds first to pay administrative
claims
in full. After the payment is completed, the remaining amount
will
be used to pay general unsecured creditors on a pro rata basis.
Under the plan, the estimated percentage recovery of Class 2
general unsecured claims is 57%.
The plan will be funded using, among other things, net receipts
from the sale of Ice Theaters' real property, which closed on
March
18, 2016. All creditors holding claims secured by the property
were paid in full at closing, according to the disclosure
statement.
A copy of the latest disclosure statement is available for free at
http://bankrupt.com/misc/IceTheaters_1DS07212016.pdf
About Ice Theaters
Ice Theaters, LLC, filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Ill. Case No. 15-26965) on Aug. 6, 2015, estimating
its assets and liabilities at between $1 million and $10 million
each. The petition was signed by Donzell Starks, manager.
Judge Pamela S. Hollis presides over the case. The Debtor is
represented by John F. Hiltz, Esq., and Blair R. Zanzig, Esq., at
Hiltz & Zanzig LLC.
Ice Theaters is headquartered in Chicago, Illinois. For a number
of years, it owned and operated a movie theater located at 3330
West Roosevelt Road, Chicago, Illinois 60624. It ceased theater
operations in December of 2013 and has since rented space in the
former theater to a variety of church and civic groups on an ad hoc
basis. As of the Petition Date, its principal asset consisted of
real property and improvements located on the real property.
IHEARTCOMMUNICATIONS INC: Soliciting Consents to Amend Indenture
----------------------------------------------------------------
iHeartCommunications, Inc., announced the commencement of a consent
solicitation to seek the consent of holders of its outstanding
Senior Notes due 2021 to a proposed amendment to the indenture
governing the Notes. The Proposed Amendment, if adopted, would
amend Section 4.09(b)(1) of the Indenture to increase the aggregate
principal amount of Indebtedness under Credit Facilities (as
defined in the Indenture) permitted to be incurred under Section
4.09(b)(1) by $500,000,000 to $17,270,638,000.
The Consent Solicitation will expire at 5:00 p.m., New York City
time, on Oct. 3, 2016, unless the Consent Solicitation is extended
or earlier terminated. Subject to the terms and conditions of the
Consent Solicitation, only the holders of Notes as of 5:00 p.m.,
New York City time, on Sept. 26, 2016, who validly deliver (and do
not validly revoke) their consents prior to the Expiration Time
will receive their portion of an aggregate cash payment of $8.6
million. The Consent Fee will be paid to each consenting holder
pro rata in accordance with the aggregate principal amount of Notes
for which consents were validly tendered (and not revoked) prior to
the Expiration Time. Consents may not be revoked after the earlier
of (i) the execution of the supplemental indenture giving effect to
the Proposed Amendment and (ii) the Expiration Time.
The Consent Solicitation is contingent upon the satisfaction of
certain conditions, including, without limitation, the receipt of
the consents of holders of at least a majority of the aggregate
principal amount of the Notes outstanding (excluding any Notes held
by the Company or its affiliates) as of the Record Time to the
Proposed Amendment by the Expiration Time. If any of the
conditions are not satisfied, the Company is not obligated to
accept any consent to the Proposed Amendment or to pay any portion
of the Consent Fee and may terminate the Consent Solicitation.
The complete terms and conditions of the Consent Solicitation are
set forth in a Consent Solicitation Statement dated as of the date
hereof and the related Letter of Consent that are being sent to the
holders of the Notes. The Company may, in its sole discretion,
terminate, extend or amend the Consent Solicitation at any time as
described in the Consent Solicitation Documents.
Moelis & Company LLC is acting as the solicitation agent for the
Consent Solicitation. Global Bondholder Services Corporation is
acting as the tabulation agent and information agent for the
Consent Solicitation. Questions regarding the Consent Solicitation
may be directed to Moelis & Company LLC at (866) 980-2551. Requests
for the Consent Solicitation Documents may be directed to Global
Bondholder Services Corporation at (212) 430-3774 (for bankers and
brokers) or (866) 470-3900 (for all others).
About iHeartCommunications
iHeartCommunications, Inc., (formerly known as Clear Channel
Communications, Inc.) is a global media and entertainment company.
The Company specializes in radio, digital, outdoor, mobile,
social, live events, on-demand entertainment and information
services for local communities, and uses its unparalleled national
reach to target both nationally and locally on behalf of its
advertising partners. The Company is dedicated to using the
latest technology solutions to transform the company's products
and services for the benefit of its consumers, communities,
partners and advertisers, and its outdoor business reaches over 40
countries across five continents, connecting people to brands
using innovative new technology.
IheartCommunications reported a net loss attributable to the
Company of $755 million on $6.24 billion of revenue for the year
ended Dec. 31, 2015, compared to a net loss attributable to the
Company of $794 million on $6.31 billion of revenue for the
year ended Dec. 31, 2014.
As of June 30, 2016, the Company had $13.3 billion in total assets,
$24.3 billion in total liabilities and a total shareholders'
deficit of $10.9 billion.
Bankruptcy Warning
"The ability to refinance the debt will depend on the condition of
the capital markets and our financial condition at such time.
Any refinancing of the debt could be at higher interest rates and
increase debt service obligations and may require us and our
subsidiaries to comply with more onerous covenants, which could
further restrict our business operations. The terms of existing
or future debt instruments may restrict us from adopting some of
these alternatives. These alternative measures may not be
successful and may not permit us or our subsidiaries to meet
scheduled debt service obligations. If we or our subsidiaries
cannot make scheduled payments on indebtedness, we or our
subsidiaries, as applicable, will be in default under one or more
of the debt agreements and, as a result we could be forced into
bankruptcy or liquidation," the Company said in its annual report
for the year ended Dec. 31, 2015.
* * *
iHeartCommunications carries a 'CCC' Issuer Default Ratings (IDR)
from Fitch Ratings and a 'Caa2 Corp." corporate family rating from
Moody's Investors Service.
INMAN STREET: Court to Convene Oct. 20 Hearing on Chapter 11 Plan
-----------------------------------------------------------------
Judge Shelley D. Rucker entered an order conditionally approving
the Disclosure Statement explaining the Chapter 11 Plan filed by
Inman Street Properties, LLC.
A hearing will be convened on Oct. 20, 2016, at 11:00 a.m. in
Chattanooga, Tennessee, to consider final approval of the
Disclosure Statement and confirmation of the Plan.
About Inman Street Properties
Inman Street Properties, LLC, filed for Chapter 11 bankruptcy
protection (Bankr. E.D. Tenn. Case No. 16-12254) on June 1, 2016.
The petition was signed by Mike Hodnett, operations manager. The
Debtor is represented by Richard L. Banks, Esq., at Richard Banks &
Associates, P.C. The Debtor estimated assets and liabilities at
$100,001 to $500,000 at the time of the filing.
INNOVATIVE OBJECTS: Seeks to Hire Berman DeLeve as Legal Counsel
----------------------------------------------------------------
Innovative Objects, LLC seeks approval from the U.S. Bankruptcy
Court for the Western District of Missouri to hire a legal counsel
in connection with its Chapter 11 case.
The Debtor proposes to hire Berman, DeLeve, Kuchan & Chapman, LLC
to provide these legal services:
(a) advising the Debtor regarding its rights and obligations;
(b) preparing legal papers;
(c) representing the Debtor at the meeting of creditors and
court hearings;
(d) soliciting consents to the Debtor's proposed plan of
reorganization and securing confirmation of the plan;
(e) representing the Debtor with respect to any matters that
may arise in connection with its reorganization and the
conduct and operation of its business; and
(f) examining claims of creditors.
The firm's attorneys designated to represent the Debtor are Ronald
Weiss, Esq., and Joel Pelofsky, Esq. They will be paid an hourly
rate of $300.
Meanwhile, the customary charges for paralegals and document
maintenance personnel are $90 per hour and $75 per hour,
respectively.
Berman DeLeve does not represent or hold any interest adverse to
the Debtor's estate, according to court filings.
The firm can be reached through:
Ronald S. Weiss, MO #21215
Joel Pelofsky, MO #17929
2850 City Center Square
1100 Main Street
Kansas City, MO 64105
Tel: (816) 471-5900
Fax: (816) 842-9955
Email: rweiss@bdkc.com
Email: jpelofsky@bdkc.com
About Innovative Objects
Innovative Objects, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W. D. Mo. Case No. 16-30446) on September
8, 2016. The petition was signed by Joe Frazier, manager.
The case is assigned to Judge Cynthia A. Norton.
At the time of the filing, the Debtor estimated assets of less than
$1 million and liabilities of $10 million to $50 million.
ION WORLDWIDE: Unsecured Creditors to Get 13%-17% Under Plan
------------------------------------------------------------
General unsecured creditors of iON Worldwide Inc. and iON America
LLC will get 13% to 17% of their claims under the companies' latest
Chapter 11 plan of reorganization.
Creditors holding Class 4 general unsecured claims will receive
their pro rata shares of $2.605 million on the effective date of
the plan, and of the first $100,000 of the amount to be recovered
from a lawsuit involving GoPro Inc., for a total recovery of $2.705
million.
General unsecured creditors assert a total of $15.88 million in
claims.
The plan is premised on the companies' restructuring support
agreement with Sky Light. Sky Light will commit to invest an
aggregate capital commitment of up to $12 million, and in exchange
will receive 100% of the new common stock issued by the companies.
Existing equity interests of the companies will be cancelled.
Proceeds of the funding will be used to pay claims of creditors,
according to the disclosure statement explaining the companies'
latest plan filed on Sept. 20 with the U.S. Bankruptcy Court in
Delaware.
A copy of the disclosure statement is available for free at
https://is.gd/T0joee
About iON Worldwide Inc.
iON Worldwide Inc. filed a Chapter 11 bankruptcy petition (Bankr.
N.D. Ga. Case No. 16-11543) on June 24, 2016. The Hon. Laurie
Selber Silverstein presides over the case. Anthony M. Saccullo,
Esq., and Thomas H. Kovach, Esq., at A.M. Sacullo Legal, LLC, and
Michael S. Fox, Esq., and Jonathan T. Koevary, Esq., at Olshan
Frome Wolosky LLP, in New York, serve as counsel.
Andrew Vara, acting U.S. trustee for Region 3, on July 6 appointed
three creditors of iON Worldwide, Inc., to serve on the official
committee of unsecured creditors. The Committee retained Benesch,
Friedlander, Coplan & Aronoff LLP as counsel.
IRF PROPERTIES: Case Summary & 2 Unsecured Creditors
----------------------------------------------------
Debtor: IRF Properties, LLC
P.O. Box 1011
Buffalo, NY 14240
Case No.: 16-11889
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Western District of New York (Buffalo)
Judge: Hon. Michael J. Kaplan
Debtor's Counsel: Arthur G. Baumeister, Jr., Esq.
AMIGONE, SANCHEZ & MATTREY LLP
1300 Main Place Tower
350 Main Street
Buffalo, NY 14202
Tel: (716) 852-1300
E-mail: abaumeister@amigonesanchez.com
Total Assets: $2.89 million
Total Liabilities: $2.25 million
The petition was signed by Brain Schectman, managing member.
A copy of the Debtor's list of two unsecured creditors is available
for free at http://bankrupt.com/misc/nywb16-11889.pdf
ISLANDWIDE LOGISTICS: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: Islandwide Logistics, Inc.
Rexco Industrial Park #150
Calle C, Esq. Calle B, Carr. 165
Guaynabo, PR 00968
Case No.: 16-07693
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Carmen D Conde Torres, Esq.
C CONDE & ASSOCIATES
254 San Jose Street, 5th Floor
San Juan, PR 00901-1523
Tel: 787-729-2900
Fax: 787-729-2203
E-mail: condecarmen@condelaw.com
- and -
Luisa S Valle Castro, Esq.
C CONDE & ASSOCIATES
254 Calle San Jose 5th Floor
San Juan, PR 00901-1523
Tel: 787 729-2900
E-mail: notices@condelaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ivan Marin, president.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/prb16-07693.pdf
ITT EDUCATIONAL: Makes First Appearance in Bankruptcy Court
-----------------------------------------------------------
Peg Brickley, writing for The Wall Street Journal Pro Bankruptcy,
reported that ITT Educational Services Inc. made its first
appearance in bankruptcy court on Sept. 28, after a sudden shutdown
cast 40,000 students and 8,000 employees adrift.
According to the report, Judge James Carr of the U.S. Bankruptcy
Court in Indianapolis is presiding over a cleanup effort for one of
the country's largest for-profit school operators, which closed its
doors abruptly Sept. 6 after federal authorities barred it from
receiving taxpayer-backed student loans.
The report related that in the 12 days since Indianapolis lawyer
Deborah Caruso was appointed chapter 7 trustee, she has signed up
liquidator Tiger Capital to sell the furniture, computers and other
assets, set up a website and a hotline to keep ex-students and
employees in the loop on developments and hired A&G Realty Partners
to start marketing ITT's 30 parcels of owned real estate.
She has also chosen an outside company to get 15 years of student
transcripts online within a week, started locking down personal
data scattered across the country in more than 100 servers, and
negotiated with secured lender Cerberus Capital Management for
money to pay for it all, Ms. Caruso's lawyers told Judge Carr, the
report further related.
The report said Judge Carr fired off questions about the massive
accounts receivable sitting on ITT's books, including money
allegedly owed by students who signed up for loans, started school,
and then dropped out.
Someone, the judge suggested, might take issue with attempts to
collect those debts, the report added. An assortment of state
attorneys general attended the court session, and one of them
signaled the state legal chiefs are preparing to weigh in on the
propriety of chasing former students for payment, the report
noted.
About ITT Educational
ITT Educational Services, Inc., is a proprietary provider of
post-secondary degree programs in the United States based on
revenue and student enrollment. As of Dec. 31, 2015, ITT was
offering: (a) master, bachelor and associate degree programs to
approximately 45,000 students at ITT Technical Institute and
Daniel
Webster College locations; and (b) short-term information
technology and business learning solutions for individuals.
ITT Educational and its subsidiaries ESI Service Corp. and Daniel
Webster College, Inc. ceased operations and commenced bankruptcy
proceedings by filing voluntary petitions for relief under Chapter
7 of the Bankruptcy Code in the U.S. Bankruptcy Court for the
Southern District of Indiana, Indianapolis Division on Sept. 16,
2016.
JALAL NEISHABOURI: Enters into Lease of Bozeman Property
--------------------------------------------------------
Jalal Neishabouri asks the U.S. Bankruptcy Court for the Central
District of California to authorize the Debtor to enter into lease
("Lease") with Sweet Peaks, Inc., of the Debtor's real property
located at 628 W. Main St., Bozeman, Montana ("Property").
The Property includes a 6,307-square-foot commercial building that
houses Debtor's business Anahita Rugs, and has an additional
commercial tenant, Onyx Salon.
Subject to approval by the Court, the Debtor and the Tenant have
entered into the Lease, which proposes to grant to Tenant a
leasehold interest in approximately 35% of the Property, for a term
of 5 years, with monthly rent due starting in year 1 of the lease
in the amount of $3,372, including triple net expenses for taxes,
insurance and common area maintenance.
A copy of the Neishabouri Declaration which sets forth the full
terms of the Lease is available for free at:
http://bankrupt.com/misc/Jalal_Neishabouri_42_Sales.pdf
The Lease is an arm's-length transaction between the Debtor and the
Tenant, in which the Debtor is represented by a real estate
professional. The Debtor has no connection to the Tenant and
submits that the Lease is in the best interests of the estate as it
fills a vacancy in Debtor's commercial building and generates
income for the estate.
Based upon his knowledge and experience as a landlord in Bozeman,
Montana, the based upon the arm's-length negotiations that led to
the Lease, and the lack of higher offers for the leased premises,
the Debtor submits that the rental rate under the Lease represents
the market rate for rent.
In good faith, the Tenant has paid its deposit under the Lease,
which is being held by Debtor pending the Court's ruling on the
Motion.
Attorneys for the Debtor:
Marc C. Forsythe, Esq.
Donald W. Reid, Esq.
Charity J. Miller, Esq.
GOE & FORSYTHE, LLP
18101 Von Karman Avenue, Suite 1200
Irvine, CA 92612
Telephone: (949) 798-2460
Facsimile: (949) 955-9437
E-mail: mforsythe@goeforlaw.com
dreid@goeforlaw.com
cmiller@goeforlaw.com
About Jalal Neishabouri
Jalal Neishabouri owns Rocky Mountain Rug Gallery, which supplies
hand-woven Persian and other oriental rugs in the Northern Rocky
Mountains. Jalal Neishabouri sought Chapter 11 protection (Bankr.
C.D. Cal. Case No. 16-12943) on July 13, 2016. The Debtor tapped
Marc C. Forsythe, Esq. at Goe & Forsythe, LLP as counsel.
JAMES HUMPHREYS: Bid to Stay "Horne" Suit Pending Appeal Denied
---------------------------------------------------------------
In the adversary proceeding captioned IRA HORNE and MAVIS HORNE,
Plaintiffs, v. JAMES HUMPHREYS and JAMES F. HUMPHREYS & ASSOCIATES,
L.C., Defendants, ADVERSARY PROCEEDING NO. 2:16-ap-2004 (Bankr.
S.D.W. Va.), Judge Frank W. Volk of the United States Bankruptcy
Court for the Southern District of West Virginia at Charleston
denied the motions filed by James Humphreys and the firm, James F.
Humphreys & Associates, L.C., for stay pending appeal of the July
15, 2016 memorandum opinion and order.
The judge also granted in part and denied in part the motion filed
by creditor and amici, Liberty Insurance Underwriters, to alter or
amend the July ruling, in part, insofar as it remanded to the
Circuit Court of Kanawha County the claims pled against Humphreys.
The defendants asserted they are "likely to prevail on appeal based
on at least three independent grounds." For their first ground,
they asserted the court erred in leaving to the assigned judicial
officer on the Circuit Court of Kanawha County the question of
insurance coverage for the Hornes' case. Judge Volk held that this
alleged error is now moot, considering that the insurance coverage
issues are now pending before an Article III judge who enjoys
plenary bankruptcy authority.
The defendants' second ground is that "the Court lacked the power
to do anything other than recommend remand ..." Judge Volk found
the contention to be errant, and pointed out that a remand order is
not -- as the defendants cast it -- "a final judgment." The judge
explained that in contrast to the finality of a court's judgment, a
remand motion typically seeks to return the case to the state court
on jurisdictional grounds. Judge Volk also added that, contrary to
what the defendants suggest, permissive abstention is also a matter
over which the bankruptcy court may enter a final order (as opposed
to a final judgment).
The defendants' third alleged error is that the court was mistaken
in some of its factual observations supporting the abstention
analysis. However, having reviewed the additional alleged factual
errors identified by the defendants, Judge Volk found that none
warrant reversal, much less a high likelihood of reversal.
Further, Judge Volk concluded that none of the alleged sources of
irreparable harm bear any weight.
In Liberty's motion to alter or amend the July Ruling, Liberty
requested that the court correct three "findings" it asserts are
factually inaccurate:
-- That Liberty joined the motion to remand;
-- That Liberty is well-steeped in the defense and progress
of the state court action; and
-- Liberty is representing both the firm and Humphreys.
To the extent the court omitted that Liberty did not desire to
permit the action in the circuit court to proceed against Humphreys
alone, Judge Volk held that the elaboration is now added.
With respect in particular to the extent Liberty is well-steeped in
the defense and progress of the state court action, Judge Volks
held that inasmuch as the challenged "finding" was tethered to the
undisputed matter of the defendants' close coordination of their
defense strategy with Liberty, there is no basis to revisit its
accuracy.
Lastly, Judge Volk held that the court's observation in the July
ruling was meant simply to reflect that Liberty is providing a
defense to both Humphreys and the Firm. The judge noted that the
observation is undisputed and unassailable, and thus, there is no
need to revisit the matter beyond this elaboration.
The bankruptcy case is IN RE: JAMES F. HUMPHREYS & ASSOCIATES,
L.C., Debtor, CASE NO. 2:16-bk-20006 (Bankr. S.D.W. Va.).
A full-text copy of Judge Volk's September 26, 2016 memorandum
opinion and order is available at
http://bankrupt.com/misc/wvsb16-20006-677.pdf.
About James F. Humphreys & Associates, L.C.
James F. Humphreys & Associates, L.C., filed for Chapter 11
bankruptcy protection (Bankr. S.D. W. Va. Case No. 16-20006) on
Jan. 13, 2016, estimating its assets and liabilities at between $1
million and $10 million each. The petition was signed by James F.
Humphreys, president.
The Firm said in a statement that it sought bankruptcy protection
to "resolve all pending and potential claims against the firm in
one forum and in a timely and equitable manner."
Judge Frank W. Volk presides over the case. Julia A. Chincheck,
Esq., who has an office in Charleston, West Virginia, and Danielle
L Dietrich, Esq., Judith K. Fitzgerald, and Beverly Weiss Manne,
Esq., at Tucker Arensberg P.C., serve as the Firm's bankruptcy
counsel. Bowles Rice LLP is the Firm's local counsel.
Mr. Humphreys said in the statement that the filing should not
affect the day-to-day operations of the firm and cases it currently
is handling.
Chris Dickerson, writing for West Virginia Record, relates that Mr.
Humphreys has been sued by former clients for allegedly Mishandling
hundreds of asbestos and flood damages cases. Mr. Humphreys and
the Firm were listed in a class action in October 2015 by people
who claim that the Firm mishandled a mass tort asbestos exposure
case against Celotex. West Virgina Record adds that in the new
Celotex complaint, McCormick claims Mr. Humphreys and the Firm
negligently failed to follow procedure for properly submitting the
plaintiffs' claims against Celotex.
James F. Humphreys & Associates, L.C., is headquartered in
Charleston, West Virginia.
JAMES SCOTT SMITH: Hearing on Plan Disclosures Set For Oct. 27
--------------------------------------------------------------
The Hon. Jimmy L. Croom of the U.S. Bankruptcy Court for the
Western District of Tennessee has scheduled for Oct. 27, 2016, at
9:30 a.m. the hearing to consider James Scott Smith and Vicky Diane
Smith's disclosure statement.
The Debtors filed the Disclosure Statement on Sept. 8, 2016.
Objections to the disclosure statement can be filed at any time
prior to the actual approval of the disclosure statement.
James Scott Smith and Vicky Diane Smith filed for Chapter 11
bankruptcy protection (Bankr. W.D. Tenn. Case No. 16-10945) on May
11, 2016. Thomas Harold Strawn, Jr., Esq., at Strawn & Edwards,
PLLC, serves as the Debtors' bankruptcy counsel.
JC PENNEY: Moody's Hikes Corporate Family Rating to B1
------------------------------------------------------
Moody's Investors Service upgraded J.C. Penney Company, Inc.'s
Corporate Family Rating to B1 from B3. Moody's also affirmed the
company's Speculative Grade Liquidity rating at SGL-1. The rating
outlook was changed to stable from positive. Actions on rated debt
instruments are detailed below.
The upgrade of J.C. Penney's ratings reflect its continued
improvement in operating performance in the face of challenging
market conditions for the department store sector. "While we
acknowledge the company has had easier comparisons than most of its
peers, its continued progress has resulted in significant
deleveraging which is evidence of the traction of its initiatives
and the recovery of market share" stated Vice President, Christina
Boni. Moody's believes the company can continue to increase sales
and operating margins through further improvements in
merchandising, sourcing and operations. Nonetheless, soft trends in
apparel spending, weak mall traffic, and continued market share
gains by off-price retailers are formidable headwinds that remain
for J.C. Penney and department stores generally.
Upgrades:
Issuer: Penney (J.C.) Company, Inc.
-- Probability of Default Rating, Upgraded to B1-PD from B3-PD
-- Corporate Family Rating, Upgraded to B1 from B3
Issuer: Penney (J.C.) Corporation, Inc.
-- Senior Secured Term Loan, Upgraded to Ba2(LGD2) from
B1(LGD2)
-- Senior Secured ABL Revolving Credit Facility, Upgraded to
Ba1(LGD2) from Ba3(LGD2)
-- Senior Secured Regular Bond/Debenture, Upgraded to Ba2(LGD2)
from B1(LGD2)
-- Senior Unsecured Medium-Term Note Program, Upgraded to (P)B3
from (P)Caa2
-- Senior Unsecured Regular Bond/Debenture, Upgraded to
B3(LGD5) from Caa2(LGD5)
-- Senior Unsecured Shelf, Upgraded to (P)B3 from (P)Caa2
Outlook Actions:
Issuer: Penney (J.C.) Company, Inc.
-- Outlook, Changed To Stable From Positive
Issuer: Penney (J.C.) Corporation, Inc.
-- Outlook, Changed To No Outlook From Positive
Affirmations:
Issuer: Penney (J.C.) Company, Inc.
-- Speculative Grade Liquidity Rating, Affirmed SGL-1
RATINGS RATIONALE
J.C. Penney's B1 Corporate Family Rating reflects the company's
high leverage and weak interest coverage. Debt/EBITDA is estimated
to be around 4.6 times as of year-end 2016 and EBITDA-Cap
Ex/Interest Expense is around 1.5 times. The rating is supported by
the company's solid liquidity profile with total liquidity of
approximately $2.4 billion ($429 million of cash and $1.9 billion
of undrawn revolving credit commitments as of July 30, 2016) and we
expect the company will continue to generate positive free cash
flow over the next 12 to 18 months. Moody's said, “We believe the
company still has room to recover market share lost under previous
management's failed business strategies and ongoing merchandising
and operational efficiencies will also help the company boost
margins over time. The ratings also consider the structural
challenges facing the Department Store segment which include market
share losses to off-price retailers, weak mall traffic, and the
cost of investments associated with managing consumer preferences
for online shopping.”
The stable rating outlook assumes that J.C.Penney will continue
track towards it operating plan and prioritize debt reduction.
Ratings could be upgraded if the company maintains continued growth
in operating earnings indicating its business initiatives continue
to succeed. Quantitatively ratings could be upgraded if debt/EBITDA
were sustained below 4.0x times and EBIT margins are sustained at
or above mid single digits.
Quantitatively ratings could be downgraded if credit metrics were
to weaken such that debt/EBITDA exceeded 5.0x, or if the company's
strong liquidity profile were to erode.
J.C. Penney Company, Inc. is the holding company of J.C. Penney
Corporation, Inc., a U.S. department store operator headquartered
in Plano, Texas, with about 1,100 locations in the United States
and Puerto Rico. It also operates a website, www.jcp.com. Revenues
are over $12.5 billion.
The principal methodology used in these ratings was Retail Industry
published in October 2015.
JOHN RITTER: Sale of Clark County Parcels to D.R. Horton Approved
-----------------------------------------------------------------
Judge Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada authorized Debtors John A. Ritter, Saguaro
Equities, LLC, and Southwest Desert Equities, LLC ("SWDE") to sell
Saguaro's and SWDE's parcels of undeveloped land located in Clark
County, Nevada, to D.R. Horton, Inc. for $297,000 per acre and
$294,250 per acre, respectively.
The sale of the parcels is free and clear of all liens, provided
that each lender will retain a lien (or interest in a lien) in the
net proceeds of the Sale commensurate with such lender's respective
lien (or interest in a lien) in the applicable parcel.
Any commissions payable to Focus Commercial Group, Inc. ("FCG")
and/or Bill Boschetto pursuant to the PSAs will be held in escrow
by Saguaro or SWDE pending the approval of FCG and/or Bill
Boschetto's retention as an estate professional pursuant to
Sections 327(a) and 330 of the Bankruptcy Code.
The net proceeds will be paid to or for the benefit of the lenders
in accordance with and pursuant to the terms of the PSAs and the
Acknowledgment and Releases.
The Order will be and is immediately effective notwithstanding the
14-day stay provided pursuant to Bankruptcy Rule 6004(h), which is
specifically waived.
About John A. Ritter
Certain alleged creditors of John A. Ritter, on Feb. 29, 2016,
filed an involuntary bankruptcy petition against him under chapter
7 of the Bankruptcy Code. Mr. Ritter opposed that petition.
However, following discussions with the petitioning creditors, he
agreed to entry of an order for relief against him under chapter
11
of the Bankruptcy Code.
Agave Properties, LLC, and its 11 affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No.
16-13338) on June 17, 2016. The petition was signed by John A.
Ritter, manager. The bankruptcy cases are jointly administered
under Mr. Ritter's Chapter 11 case, Case No. 16-10933.
The cases are assigned to Judge Mike K. Nakagawa.
At the time of the filing, Agave Properties and its 11 affiliates
estimated their assets at $10 million to $50 million and
liabilities at $100 million to $500 million.
JOSUE CARRERO: Ch. 11 Case Converted to Ch. 7
---------------------------------------------
Judge Brian K. Tester of the United States Bankruptcy Court for the
District of Puerto Rico granted the Motion to Convert to the
Chapter 11 case of Josue Carrion Carrero to a case under Chapter 7
pursuant to Section 1112(b) of the Bankruptcy Code.
The United States Trustee filed the Motion to Convert to Chapter 7.
Firstbank Puerto Rico filed the Motion Requesting Conversion or
Dismissal.
Judge Tester held that the Debtor, while acting as
debtor-in-possession and as a fiduciary to his creditors, acted
either deliberately or recklessly in failing to disclose the
existence of valuable estate assets. He continued to conceal that
information from his creditors for several months, the judge said.
An inexcusable failure to make numerous, material financial
disclosures supports a finding of cause for dismissal, conversion
or the appointment of a trustee under Section 1112(b), the judge
added. The court rejects the Debtor's explanation for his
unacceptable financial reporting. The court finds that the
Debtor's violation of his duties, at a minimum, reckless or, worse
still, purposeful. Either way, his conduct is inexcusable. Without
a reasonable justification for the Debtor's inadequate performance
as DIP, the case must be converted or dismissed.
Further, and more fundamentally, the Debtor has not established
that this case is unusual in either common meaning of the term or
in the specialized way it is employed in Section 1112(b)(2), such
that it would be appropriate to disregard the existence of cause of
conversion of the case, Judge Tester held. The UST has established
cause for relief under section 1112(b)(2) and the Debtor has failed
to establish the existence of unusual circumstances under section
1112(b)(2).
A full-text copy of the Opinion and Order dated September 1, 2016
is available at https://is.gd/oPYw7C from Leagle.com.
JOSUE CARRION CARRERO, Debtor, is represented by JESUS ENRIQUE
BATISTA SANCHEZ, Esq. -- THE BATISTA LAW GROUP, PSC.
About Josue Carrion Carrero
Josue Carrion Carrero filed a Chapter 11 bankruptcy petition
(Bankr. D.P.R. Case No. 16-0194) on March 11, 2016.
KEITH GUERZON: Unsecureds To Recover 13% Under Plan
---------------------------------------------------
Keith Guerzon filed with the U.S. Bankruptcy Court for the Southern
District of New York an amended disclosure statement in connection
with approval and confirmation of the Debtor's accompanying plan of
reorganization.
Allowed Class 3 Unsecured Claims -- which total $425,312.92 -- will
receive a total of $55,329.74. The Class 3 Unsecured Claims will
be paid from net disposable income of the Debtor/Reorganized Debtor
on a monthly basis over five years in an amount equal to 13% of the
Allowed Unsecured Claims. This class is impaired and entitled to
vote to accept or reject the Plan.
Payments to holders of allowed claims under the Plan will be made
by the Debtor/Reorganized Debtor from (a) cash on hand as of the
Effective Date, (b) cash realized from the Debtor's/Reorganized
Debtor's earnings following the Effective Date, and (c) cash
contributed or loaned by third parties.
The Amended Disclosure Statement is available at:
http://bankrupt.com/misc/nysb14-22171-69.pdf
The Plan was filed by the Debtor's counsel:
H. Bruce Bronson, Esq.
BRONSON LAW OFFFICES, P.C.
480 Mamaroneck Ave.
Harrison, NY 10528
Tel: (914) 269-2530
Keith Guerzon is an individual who is employed in an executive
capacity for a company that is engaged in excavation with
headquarters in Stamford, Connecticut.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 14-22171).
KEMET CORP: Files Copy of Investor Presentation with SEC
--------------------------------------------------------
William M. Lowe, Jr., executive vice president and chief financial
officer, of KEMET Corporation, was scheduled to provide certain
investor information, including an investor presentation commencing
on Tuesday Sept. 27, 2016 in Scottsdale, Arizona. The slide
package prepared by the Company for use in connection with these
presentations is available for free at https://is.gd/rFhlah
About KEMET
KEMET, based in Greenville, South Carolina, is a manufacturer and
supplier of passive electronic components, specializing in
tantalum, multilayer ceramic, film, solid aluminum, electrolytic,
and paper capacitors. KEMET's common stock is listed on the NYSE
under the symbol "KEM."
KEMET reported a net loss of $53.6 million on $735 million of net
sales for the fiscal year ended March 31, 2016, compared to a net
loss of $14.1 million on $823 million of net sales for the fiscal
year ended March 31, 2015.
As of June 30, 2016, Kemet had $671 million in total assets, $583
million in total liabilities and $88.4 million in total
stockholders' equity.
* * *
As reported by the TCR on March 26, 2013, Moody's Investors
Service downgraded KEMET Corp.'s Corporate Family Rating to 'Caa1'
from 'B2' and the Probability of Default Rating to 'Caa1-PD' from
'B2- PD' based on Moody's expectation that KEMET's liquidity will
be pressured by maturing liabilities and negative free cash flow
due to the interest burden and continued operating losses at the
Film and Electrolytic segment.
As reported by the TCR on Aug. 9, 2013, Standard & Poor's Ratings
Services lowered its corporate credit rating on KEMET to 'B-' from
'B+'. "The downgrade is based on continued top-line and margin
pressures and lagging results from the restructuring of the Film &
Electrolytic [F&E] business, which combined with cyclical weak
end-market demand, has resulted in sustained, elevated leverage
well in excess of 5x, persistent negative FOCF, and diminishing
liquidity," said Standard & Poor's credit analyst Alfred
Bonfantini.
The TCR reported in August 2014 that S&P revised its outlook on
KEMET to 'stable' from 'negative'. S&P affirmed the ratings,
including the 'B-' corporate credit rating.
KENDALL LAKE TOWERS: Becker & Poliakoff Opposes Plan Outline
------------------------------------------------------------
Becker & Poliakoff, P.A., asked the U.S. Bankruptcy Court for the
Southern District of Florida to deny approval of the disclosure
statement explaining the Chapter 11 plan of Kendall Lake Towers
Condominium Association, Inc.
In a court filing, Becker & Poliakoff, the condominium
association's largest unsecured creditor, said the disclosure
statement "does not contain adequate information."
"The disclosure statement fails to adequately describe the
debtor's operations for the last two years and the Board's failure
to render special assessments," Becker & Poliakoff said.
The creditor, which holds an unsecured claim of $225,000, also said
that the document contains "numerous inconsistencies" regarding the
accounting method used by the condominium association, and is
inconsistent concerning the association's net income and reserves.
Becker & Poliakoff is represented by:
Lisa M. Castellano, Esq.
1511 N. Westshore Boulevard, Suite 1000
Tampa, Florida 33607
Phone: 813-527-3900
Fax: 813-286-7683
About Kendall Lake Towers
Kendall Lake Towers Condominium Association, Inc. sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla., Case No.
16-12114) on Feb. 16, 2016. The Debtor is represented by Joel M.
Aresty, Esq., at Joel M. Aresty, PA.
At the time of the filing, the Debtor estimated its assets and
debts at $500,001 - $1 million.
KENNETH ARTHURS: Unsecureds Get at Least 33% Dividend Under Plan
----------------------------------------------------------------
Kenneth and Brenda Arthurs filed with the U.S. Bankruptcy Court for
the Western District of Pennsylvania a disclosure statement to
accompany the Debtors' plan of reorganization dated Sept. 12,
2016.
Under the Plan, Class 9 General Unsecured Non-Tax Claims -- owed by
the Debtor a total of $81,037.94 -- and Tax Claims totaling
$35,056.41 will have a dividend of at least 33%.
Unsecured claimants will each receive $855 per month starting Dec.
15, 2016, until Dec. 15, 2021. Payments to some creditors will not
be made until conclusion of the claim objections filed by the
Debtor. If any claims are determined to be valid, the Debtors will
commence making payments to that creditor and the monthly payment
amount to this class will increase accordingly. Furthermore, the
distribution to unsecured creditors may increase depending upon the
result of the Indiana County law suit.
Funds for planned payments will be taken from earnings from the
operation of the restaurant business operated by the Debtors.
The Disclosure Statement is available at:
http://bankrupt.com/misc/pawb15-70795-131.pdf
Kenneth J. Arthurs and Brenda L. Arthurs sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W. D. Pa. Case No.
15-70795). The case is assigned to Judge Jeffery A. Deller.
KHANH VAN TONG: Unsecured Creditors to Get Nothing Under Plan
-------------------------------------------------------------
General unsecured creditors will not receive a distribution under
the plan proposed by Khanh Van and Thuy Luu Tong to exit Chapter 11
protection.
According to the Debtors' disclosure statement, creditors holding
Class 3 general unsecured claims will receive an estimated 0%
distribution under the plan, which is what they would receive in a
Chapter 7 liquidation.
Class 3 consists of the general unsecured portion of the Internal
Revenue Service's claim and claims of medical creditors. General
unsecured creditors are entitled to vote on the plan.
Payments under the plan will be funded by the earnings of the
Debtors from their job as nail and beauty technicians, according to
the disclosure statement filed on Sept. 20 with the U.S. Bankruptcy
Court in Kansas.
A copy of the disclosure statement is available for free at
https://is.gd/SLGvQw
About The Tongs
Khanh Van Tong and Thuy Luu Tong, who work as nail and beauty
technicians, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Kan. Case No. 16-21262) on July 1, 2016.
The Debtors are represented by George J. Thomas, Esq.
KIDS ONLY II: Plan Confirmation Hearing on Oct. 4
-------------------------------------------------
The Hon. Robert Summerhays of the U.S. Bankruptcy Court for the
Western District of Louisiana has conditionally approved the
disclosure statements separately filed by Kids Only II of
Lafayette, LLC, and Kids Only III of Lafayette, LLC.
The Court will hold on Oct. 4, 2016, at 10:00 a.m. a hearing to
consider the final approval of the Disclosure Statements and the
confirmation of the Plans of reorganization.
Objections to the Disclosure Statements and the confirmation of the
Plans must be filed by Sept. 27, 2016. Written acceptances or
rejections of the Plans must also be filed by Sept. 27.
Kids Only III's Plan proposes that all of the assets of the Debtor,
including its daycare and related equipment and supplies, will be
sold. The Debtor proposes to sell the daycare for $325,000 or at
least an amount sufficient to pay RREF II PEBP-LA, LLC, and the
Internal Revenue Service their allowed secured claims and use the
remaining funds to pay creditors and distribute funds to
shareholder once creditors are paid in full.
Kids Only II of Lafayette, LLC, and Kids Only III of Lafayette,
LLC, provide childcare services.
Kids Only II of Lafayette, LLC, filed a Chapter 11 bankruptcy
petition (Bankr. W.D. La. Case No. 15-51354) on Oct. 20, 2015.
Kids Only III of Lafayette, LLC, filed a separate Chapter 11
petition (Bankr. W.D. La. Case No. 15-51355) on Oct. 20, 2015.
Both Debtors are represented by Thomas E. St. Germain, Esq. --
ecf@weinlaw.com -- at Weinstein Law Firm.
KM VILLAS: Seeks to Hire Ice Legal as Counsel in Suit v. HSBC
-------------------------------------------------------------
K.M. Villas LLC seeks approval from the U.S. Bankruptcy Court for
the Southern District of Florida to hire Ice Legal, P.A. as special
counsel.
The firm will represent the Debtor in a case it filed against HSBC
Bank USA, N.A. to contest the bank's $2.1 million claim. HSBC Bank
claims to have a first deed of trust against the Debtor's real
property located in West Hollywood, California.
The firm's professionals and their hourly rates are:
Thomas Ice $450
Other Attorneys $350
Paralegals $110
Steven Brotman, Esq., the attorney designated to represent the
Debtor, disclosed in a court filing that he does not hold or
represent any interest adverse to the bankruptcy estate.
Ice Legal can be reached through:
Steven Brotman, Esq.
Ice Legal, P.A.
1015 N. State Road 7, Suite D
Royal Palm Beach, FL 33411
Tel: 561.729.0530
Fax: 1.866.507.9888
Email: mail@icelegal.com
About K.M. Villas
K.M. Villas LLC, based in Miami, Florida, owns a four-unit
residential building located at 930-934 N. Harper Avenue, West
Hollywood, California. The Debtor has valued the property at $1.30
million.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr. S.D.
Fla. Case No. 15-14807) on March 16, 2015. Judge Robert A. Mark
presides over the case. The Debtor listed $1.3 million in assets
and $2.76 million in liabilities. The petition was signed by Kevin
Hinds, member.
LAREDO WO: WRR Offers $49.1M for Substantially All Assets
---------------------------------------------------------
Laredo Wo, Ltd., asks the U.S. Bankruptcy Court for the Western
District of Texas to authorize the purchase and sale agreement for
the sale of substantially all of Debtor's assets to WRR Interests,
LLC for $38,300,000, plus additional consideration of up to
$10,800,000 to be paid over time from monies paid by a MUD from
bond proceeds.
The Debtor was formed on Jan. 18, 2007, to acquire, develop, sell,
lease or operate a tract of land in Georgetown, Texas, to be called
the "Water Oak" ("Property") which currently consists of
approximately 1,159 acres of the Laredo Water Oak master planned
community located along the south side of SH-29 at Water Oak
Parkway and the north side of FM 2243 in Georgetown, Williamson
County, Texas.
The Property is fully entitled. The Debtor is a party to Amended
and Restated Development Agreement Concerning the Water Oak
Subdivision (f/k/a ABG Subdivision) dated March 14, 2012, and
recorded under Document No. 2012027844, Official Public Records of
Williamson County, Texas ("COG Development Agreement"). The COG
Development Agreement sets forth the terms, conditions and
agreements with applicable governmental authorities governing the
development of the Property.
The Property is also subject to an Amended and Restated Consent
Agreement dated Jan. 4, 2012 ("Consent Agreement") pursuant to
which the Williamson County Municipal; District #25 was created.
The Debtor filed the Chapter 11 Case on June 6, 2016 to prevent
foreclosure upon the Property and to either restructure its debts
or to conduct an orderly sale of the Property. Since the Petition
Date, and prior to engaging a real estate broker or actively
marketing the Property, the Debtor received numerous expressions of
interest to acquire the Property. Those early expressions of
interest progressed quickly to negotiations of a purchase and sale
agreement ("PSA") with one particular prospective buyer.
The general partner of the Debtor after weighing the sentiment of
its limited partners and taking into consideration that the offer
received by the Debtor is adequate to pay all of the creditors of
the estate in full, determined to forgo a market clearing process
and a formal sale procedure. The Debtor has executed a PSA with WRR
to purchase the Property for a base purchase price of $38,300,000
plus additional consideration of up to $10,800,000 to be paid over
time from monies paid by a MUD from bond proceeds ("WRR PSA"). The
Debtor is proceeding with the motion to sell the Property to the
WRR as a designated buyer.
Contemporaneously with the filing of the Motion, the Debtor is also
filing its application to retain Texas Land Advisors-Houston, LLC,
doing business as Land Advisors Organization ("Broker") to market
the Property in order to locate a prospective back up purchaser.
The WRR PSA permits the Purchaser a 75-day examination period
during which the Purchaser has the right to terminate the WRR PSA.
The Debtor seeks to retain the Broker to market the Property,
identify additional prospective purchasers for the Property and
negotiate a back-up contract(s) in the event the Purchaser elects
not to proceed with the purchase of the Property as provided in the
WRR PSA.
A copy of the WRR PSA attached to the Motion is available for free
at:
http://bankrupt.com/misc/Laredo_Wo_28_Sales.pdf
The executed WRR PSA generally provides the following:
a. Purchase Price: (i) $38,300,000 in cash; (ii) additional
consideration of up to $10,800,000 to be paid over time from monies
paid by a MUD from bond proceeds and (iii) assume certain
liabilities of Debtor.
b. Property: The proposed sale will include the Property which
comprise substantially all of the real property of the Debtor's
estate. The Debtor will also convey all improvements on the
Property, together with all tangible personal property owned by the
Debtor related to or used in connection with the Property or
improvements. The Debtor will also convey to the Purchaser all
plans, studies, reports, assessments and other intangible property
more fully described in the WRR PSA.
c. Sale Free and Clear: The Property is to be transferred free
and clear of all liens, interests, claims, or encumbrances.
d. Assumption of Executory Contracts and Leases: Seller will
assume and assign to the Buyer all of Debtor's rights under, title
to, and interest in those Assigned Contracts identified in the WRR
PSA, including, but not limited to the COG Development Agreement
and the partial assignment of the Consent Agreement.
e. Conditions to Closing: The WRR PSA does not contain any
financing condition. The WRR PSA does permit the Purchaser an
"Examination Period" of 75 days following the date the Court enters
the Sale Order. In addition to the forgoing conditions and other
customary conditions to closing, the Purchaser's performance is
conditioned upon the assignment of the Executory Contracts and
approval of the sale to WRR pursuant to the WRR PSA by the Court.
The Debtor requests that the Court enter orders accepting the
business judgment of the Debtor's management and partners and
approve the sale of the Property to WRR on the terms and conditions
of the WRR PSA between the Debtor and WRR.
On Feb. 22, 2007, Hillcrest Bank, a Kansas state banking
association ("HCB") the Debtor entered into an Acquisition and
Pre-Development Loan Agreement ("Loan Agreement") whereby HCB
agreed to loan the Debtor up to $48,500,000 ("Loan") in connection
with the acquisition of the Property. The Loan was secured by a
Deed of Trust (With Security Agreement, Assignment of Rents and
Lease and Financing Statement) ("First Deed of Trust") granted by
Debtor in favor of HCB, relating to the Property.
On Jan. 28, 2008, the Debtor and HCB entered into a First
Modification of Loan Documents. Contemporaneously therewith,
Borrower executed a Promissory Note ("Second Note") for the
principal sum of $599,555. The Second Note was secured by another
Deed of Trust (With Security Agreement, Assignment of Rents and
Lease and Financing Statement) granted by Borrower in favor of HCB,
relating to the Property. Borrower subsequently provided a third
Deed of Trust (With Security Agreement, Assignment of Rents and
Lease and Financing Statement) in favor of HCB in connection with a
Second Modification of Loan Documents on March 31, 2009. As of the
Petition Date, the Debtor alleges that the total indebtedness owed
to HCB was $36,151,911.
The only additional liens on the Property may consist of lienable
mechanics and materialmen's claims. The Debtor is not aware of any
mechanic's or materialmen's liens being recorded as of the date of
the Motion. The Debtor believes that the time has expired for any
possible lien claims to be filed. In addition, various taxing
authorities may assert claims for taxes accruing in 2016 which may
be lienable claims against the Property. Williamson County has
filed such a secured claim in the amount of $118,522.
All parties holding secured claims are aware of the proposed sale,
and thus, Debtor is confident it will obtain any necessary consent
on or before the Sale Hearing, thereby satisfying Bankruptcy Code
section 363(f)(2). Moreover, the purchase price proposed in the
WRR PSA is sufficient to pay all known claims against the Debtor.
Accordingly, the Debtor submits that one or more of the subsections
of Bankruptcy Code section 363(f) applies, and that any such
Interest will be adequately protected by having it attach to the
net proceeds of the sale, subject to any claims and defenses Debtor
may possess with respect thereto.
As part of the Motion, the Debtor also seeks authority to assume
and assign the Assigned Contracts to Purchaser. The WRR PSA
currently identifies the COG Development Agreement and a partial
assignment of the Consent Agreement as executory contracts to be
assumed by the Debtor and assigned to WRR.
The Debtor further requests the Court to waive the 14-day stay
period under Bankruptcy Rule 6004(g).
The Purchaser:
Mr. Randy Rollo
WRR INTERESTS, LLC
4807 Spicewood Springs Road, Suite B-104
Austin, TX 78759
Telephone: (512) 750-0896
E-mail: RandyRollo@gmail.com
The Purchaser is represented by:
Monty Watson, Esq.
WATSON LAW GROUP, PLLC
4925 Greenville Avenue
Floor 7, Suite 717
Dallas, TX 75206
Telephone: (214) 810-5914
Facsimile: (214) 550-2646
E-mail: monty@mmwatson.com
About Laredo WO
Headquartered in San Antonio, Texas, Laredo WO, Ltd., a Texas
limited partnership, owns a fully entitled, 1056 acre real estate
development with approximately 2400 residential lots located in
Georgetown, Texas.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr. W.D.
Tex. Case No. 16-51297) on June 6, 2016, listing $69.59 million in
total assets and $36.50 million in total debts. The petition was
signed by Bradford A. Galo, CEO of Galo, Inc. (managing GP of ABG
Enterprises, Ltd.) Judge Ronald B. King presides over the case.
Eric Terry, Esq., at Eric Terry Law, PLLC, serves as the Debtor's
bankruptcy counsel.
LAST CALL GUARANTOR: McCarron, Sullivan Represent M&D Clients
-------------------------------------------------------------
Pursuant to Rule 2019(a) of the Federal Rules of Bankruptcy
Procedure, McCarron & Diess and Sullivan Hazeltine Allinson LLC
filed with the U.S. Bankruptcy Court for the District of Delaware,
disclosing that McCarron & Diess is lead counsel and Sullivan
Hazeltine is local counsel to the M&D clients or creditors who hold
PACA trust claims against Last Call Guarantor, LLC, et al., for
unpaid produce sales in the Debtors' bankruptcy case who are acting
in concert to advance their common interests and are not composed
entirely of affiliates or insiders of one another.
M&D clients include:
a. Brothers Produce, Inc.,
c/o Lois Carlisle, Chief Financial Officer
P.O. Box 1207
Friendswood, Texas 77549-1207;
b. Brothers Produce of Dallas, Inc.
c/o James Bos, Chief Financial Officer
P.O. Box 550278, Dallas, Texas 75355
c. Charlie Sciara & Son Produce Co., Inc.
c/o Linda Sciara, Secretary/Treasurer
4700 Burbank
Memphis, TN 38118;
d. Creation Gardens, Inc.
c/o Jim Walker, President
2055 Nelson Miller Parkway
Louisville, KY 40223;
e. Dixie Produce, Inc.
c/o Robert L. Pittman, President
P.O. Box 429
Chattanooga, TN 37401-0429;
f. Frontier Produce, Inc.
c/o Robert A. DeWitt, President
10060 E. 52nd Street
Tulsa, OK 74146-5713;
g. Get Fresh Produce, Inc.
c/o Mark Mondrala, Controller
1441 Brewster Creek Boulevard
Bartlett, IL 60103;
j. Ambrogi Food Distribution, Inc.
c/o John G. Ambrogi, President
P.O. Box 38
Thorofare, NJ 08086;
h. LaGrasso Bros., Inc.
c/o Catherine LaGrasso, Vice President
P.O. Box 2638
Detroit, MI 48202-2638;
i. Liberty Fruit Co., Inc.
c/o Allen C. Caviar, President
1247 Argentine Boulevard
Kansas City, KS 66105-1508;
j. Piazza Produce, Inc.
c/o Charles Elsener, Controller
P.O. Box 68931
Indianapolis, IN 46268-0931;
k. Potato Specialty Co.
c/o Larry E. Ezell, Jr., President/Treasurer
2610 Avenue A
Lubbock, TX 79404-1616;
l. Premier Produce One Inc. a/t/a Produce One, Inc.
c/o Gary M. Pavlofsky, President/CEO
904 Woodley Road, Dayton, OH 45403;
m. Produce Source Partners, Inc.
c/o Steve Entz, Chief Financial Officer
13167 Telcourt Road
Ashland, VA 23 005-7575;
n. QF&V, LLC a/t/a Quality Fruit & Vegetable
c/o Nick Delgado, Managing Member
10 Zane Grey Street
El Paso, Texas 79906;
o. Sirna & Sons, Inc. a/t/a Sirna & Sons Produce
c/o Vincent Sirna, Vice President
7176 ST Rt 88, Ravenna, Ohio 44266-9189; and
q. Willie Itule Produce, Inc.
c/o William A. Itule, President
301 North 45th Avenue
Phoenix, Arizona 85043.
In addition to the principal PACA trust claims held by each of the
M&D Clients, all of the M&D Clients hold a PACA trust claim against
the Debtors for applicable interest thereon, with these entities
also holding PACA trust claims against the Debtors for attorneys'
fees:
-- Brothers Produce Dallas, Inc.
-- Creation Gardens, Inc.
-- Dixie Produce, Inc.
-- Get Fresh Produce, Inc.
-- J. Ambrogi Food Distribution Co., Inc.
-- Liberty Fruit Co., Inc.
-- Premier Produce One, Inc.
-- Produce Source Partners, Inc.
-- QF&V, LLC a/t/a Quality Fruit & Vegetable
-- Sirna & Sons, Inc. a/t/a Sirna & Sons Produce
-- Willie Itule Produce, Inc.
McCarron & Diess and Sullivan Hazeltine were retained and have
entered appearances in the case on behalf of each of the M&D
Clients. Neither McCarron & Diess nor Sullivan Hazeltine hold a
disclosable economic interest in any claims held by the M&D
Clients.
McCarron & Diess and Sullivan Hazeltine did not have, as of the
time of their employment by the M&D Clients, and do not now have,
any disclosable economic interest in the Debtors.
McCarron & Diess and Sullivan Hazeltine can be reached at:
Mary Jean Fassett, Esq.
McCarron & Diess
4530 Wisconsin Avenue, NW No. 301
Washington, D.C. 20016
Tel: (202) 364-0400
Fax: (202) 364-2731
E-mail: mjf@mccarronlaw.com
Elihu E. Allison III
Sullivan Hazeltine Allison LLC
901 North Market Street, Suite 1300
Wilmington, DE 19801
Tel: (302) 428-8191
Fax: (302) 428-8195
E-mail: zallinson@sha-llc.com
About Last Call Guarantor
Headquartered in Dallas, Texas, and with operations in 25 states,
Last Call Guarantor, LLC, et al., own and operate sports bar and
casual family-dining restaurants under three well-recognized
concepts, namely Fox & Hound, Bailey's Sports Grille, and Champps.
They operate 48 Fox & Hound locations, nine Bailey's locations, and
23 Champps locations. They have franchise agreements with five
franchisees for Champps Restaurants. The Company has more than
4,700 full and part-time employees.
On Aug. 10, 2016, each of Last Call Guarantor, LLC, Last Call
Holding Co. I, Inc., Last Call Operating Co. I, Inc., F&H
Restaurants IP, Inc., KS Last Call Inc., Last Call Holding Co. II,
Inc., Last Call Operating Co. II, Inc., Champps Restaurants IP,
Inc. and MD Last Call Inc. filed a Chapter 11 bankruptcy petition
(Bankr. D. Del. Case Nos. 16-11844 to 16-11852). The petitions were
signed by Roy Messing, the CRO.
Last Call Guarantor estimated assets in the range of $10 million to
$50 million and liabilities of $100 million to $500 million.
Dennis A. Meloro, Esq., Nancy A. Mitchell, Esq., Nancy A. Peterman,
Esq., Matthew Hinker, Esq., and John D. Elrod, Esq., at Greenberg
Traurig, LLP, represent the Debtors as counsel.
Judge Kevin Gross is assigned to the cases.
LEGACY RESERVES: S&P Lowers CCR to 'CCC' Over Liquidity
-------------------------------------------------------
S&P Global Ratings said that it lowered its corporate credit rating
on Legacy Reserves L.P. to 'CCC' from 'B-'. The rating outlook is
negative.
At the same time, S&P lowered its issue-level rating on the
company's outstanding senior unsecured notes to 'CCC-' from 'CCC+'.
The '5' recovery rating is unchanged, indicating S&P's expectation
for modest (10%-30%; lower half of the range) recovery of principal
in the event of a payment default.
The downgrade reflects S&P's expectation that the borrowing base on
Legacy's revolving credit facility could be lowered substantially
at its redetermination in October. Legacy has stated publicly that
its banking partners have been unwilling to act as counterparty on
additional hedge positions going forward, based on the company's
credit profile and the banks' desire to reduce exposure to the oil
and gas sector. Consequently, S&P believes the position the banks
have taken could be a precursor to a significant reduction in
company's revolving credit facility during the upcoming
redetermination period.
"The negative outlook reflects the increased likelihood of a debt
exchange, which we view as distressed, given Legacy's high leverage
measures and the current market value of its unsecured notes," said
S&P Global Ratings' credit analyst Aaron McLean. "We also believe
the company's liquidity could deteriorate further, since it faces a
possible reduction in its borrowing base at the scheduled October
redetermination."
S&P could lower its corporate credit rating on Legacy if S&P
expects a specific default scenario within six months or if the
likelihood of further distressed debt exchanges increases.
S&P could raise the corporate credit rating to 'CCC+' if Legacy is
able to maintain adequate liquidity and the probability of a
default or a debt exchange that S&P viewed as distressed over the
next 12 months decreased significantly.
LEHMAN BROTHERS: To Pay Another $3.8-Bil. to Creditors
------------------------------------------------------
Patrick Fitzgerald, writing for The Wall Street Journal Pro
Bankruptcy, reported that the team winding down Lehman Brothers
Holdings Inc. said it would be paying out $3.8 billion to creditors
next week, more than eight years after the investment bank's
collapse triggered the financial crisis.
According to the report, the distribution, the 11th since the
investment bank failed in 2008, will bring the total payout in the
firm's bankruptcy to more than $113.6 billion. The bulk of the
cash -- $83.6 billion -- has gone to pay so-called third-party, or
non-Lehman claims, the report related.
Lehman said in a filing in U.S. Bankruptcy Court in New York that
its senior unsecured creditors, Lehman bondholders who were
estimated to receive about 21 cents on the dollar when the bank's
bankruptcy plan went into effect in early 2012, will have recovered
more than 40 cents on the dollar after the next distribution is
completed, the report further related.
General unsecured creditors of Lehman's commodities unit,
meanwhile, will have received nearly 79 cents on the dollar
following the latest distribution, the report said.
The boost in recoveries has come from gains in the estate's real
estate, derivatives and private-equity investments, Lehman has
said, the report added.
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the
fourth largest investment bank in the United States. For more
than
150 years, Lehman Brothers has been a leader in the global
financial markets by serving the financial needs of corporations,
governmental units, institutional clients and individuals
worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petition
disclosed US$639 billion in assets and US$613 billion in debts,
effectively making the firm's bankruptcy filing the largest in
U.S. history. Several other affiliates followed thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant to
the provisions of the Securities Investor Protection Act (Case No.
08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. The Chapter 11 plan for the Lehman companies other than
the broker was confirmed in December 2011.
* * *
In October 2015, Lehman made its eighth distribution to creditors,
bringing Lehman's total distributions to unsecured creditors to
approximately $105.4 billion including (1) $77.2 billion of
payments on account of third-party claims, which includes
non-controlled affiliate claims and (2) $28.2 billion of payments
among the Lehman Debtors and their controlled affiliates.
As of September 2015, the trustee in charge of LBI has returned
around $7.65 billion to the defunct brokerage's unsecured
creditors, a recovery of about 35 cents on the dollar.
LEN-TRAN INC: Court Extended Plan Filing Deadline to Oct. 10
------------------------------------------------------------
Judge Michael G. Williamson of the U.S. Bankruptcy Court for the
Middle District of Florida extended the periods during which
Len-Tran, Inc., dba Turner Tree & Landscape has the exclusive right
to propose and file a plan of reorganization through and including
Oct. 10, 2016, and solicit acceptances of a plan through and
including Dec. 9, 2016.
The Troubled Company Reporter reported earlier that the Debtor
requested the Court to extend its exclusivity deadline contending
that although the Debtor is in the process of formulating its plan,
the Debtor requires an extension to finalize the plan.
About Len-Tran Inc.
Len-Tran, Inc., dba Turner Tree & Landscape, based in Bradenton,
Florida, filed a Chapter 11 petition (Bankr. M.D. Fla. Case No.
16-04145) on May 13, 2016. Elena P Ketchum, Esq., at Stichter,
Riedel, Blain & Postler, P.A., serves as counsel to the Debtor. In
its petition, the Debtor estimated $1 million to $10 million in
both assets and liabilities. The petition was signed by Darrell
Turner, president.
No official committee of unsecured creditors has been appointed in
the case.
LEONEL DIAZ HERNANDEZ: Unsecureds To Recoup 3% Under Plan
---------------------------------------------------------
Leonel Diaz Hernandez and Rosemarie Espinal Castillo filed with the
U.S. Bankruptcy Court for the District of Puerto Rico a first
amended disclosure statement describing the Debtors' plan of
reorganization.
Each holder of Class 4 General Unsecured Claims will receive a
distribution equal to 3% of its allowed claim pursuant to the terms
and conditions of the Plan, that is during the three years
following the effective date. Creditors will be paid on monthly
installments within a period of up to 36 months.
The First Amended Disclosure Statement is available at:
http://bankrupt.com/misc/prb15-06796-70.pdf
The Plan will be funded by cash on hand at the Effective Date, the
Debtors' income, savings on reduction of expenses, and savings on
mortgage monthly payments in the amount of $1,961 due to pay off
the same effective July 2016, will be use also for the payment
Plan.
Leonel Diaz Hernandez and Rosemarie Espinal Castillo filed for
Chapter 11 bankruptcy protection (Bankr. D.P.R. Case No. 15-06796)
on Sept. 2, 2015.
LIFSCHULTZ ESTATE: Taps DelBello Donnellan as Legal Counsel
-----------------------------------------------------------
Lifschultz Estate Management LLC seeks approval from the U.S.
Bankruptcy Court for the Southern District of New York to hire
legal counsel in connection with its Chapter 11 case.
The Debtor proposes to hire DelBello Donnellan Weingarten Wise &
Wiederkehr, LLP to provide these legal services:
(a) advise the Debtor regarding its powers, duties and
responsibilities;
(b) negotiate with creditors and work out a plan of
Reorganization;
(c) prepare legal papers and appear before the bankruptcy
court to protect the Debtor's interest;
(d) attend meetings and negotiate with representatives of
creditors and other parties;
(e) advise the Debtor in connection with any potential
refinancing of secured debt and sale of its assets;
(f) represent the Debtor in connection with obtaining post-
petition financing, if necessary; and
(g) take any necessary action to obtain approval of a
disclosure statement and confirmation of a plan of
reorganization.
The firm's professionals and their hourly rates are:
Partners $395 - $595
Of Counsel $375
Associates $200
Paraprofessionals $150
Jonathan Pasternak, Esq., at DelBello, disclosed in a court filing
that the firm is a "disinterested person" as defined in section
101(14) of the Bankruptcy Code.
The firm can be reached through:
Jonathan S. Pasternak, Esq.
Julie Cvek Curley, Esq.
DelBello Donnellan Weingarten
Wise & Wiederkehr, LLP
One North Lexington Avenue
White Plains, New York 10601
Tel: (914) 681-0200
Fax: (914) 684-0288
Email: jpasternak@ddw-law.com
About Lifschultz Estate
Lifschultz Estate Management LLC sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S. D. N.Y. Case No. 16-23144) on
August 23, 2016. The petition was signed by Bruce S. Abbott,
managing member.
The case is assigned to Judge Robert D. Drain.
At the time of the filing, the Debtor estimated its assets and
liabilities at $10 million to $50 million.
LIGHTSTREAM RESOURCES: Moody's Lowers PDR to D-PD on CCAA Filing
----------------------------------------------------------------
Moody's Investors Service downgraded the Probability of Default
Rating for Lightstream Resources Ltd. to D-PD from C-PD/LD in
response to the company's announcement that it obtained an initial
court order to restructure under the Companies' Creditors
Arrangements Act (CCAA).
Lightstream's C Corporate Family Rating (CFR) and C senior
unsecured notes rating were affirmed. The rating outlook is
negative.
Downgrades:
Issuer: Lightstream Resources Ltd
Probability of Default Rating, Downgraded to D-PD from C-PD /LD
Outlook Actions:
Issuer: Lightstream Resources Ltd
Outlook, Remains Negative
Affirmations:
Issuer: Lightstream Resources Ltd
Corporate Family Rating, Affirmed C
Senior Unsecured Regular Bond/Debenture, Affirmed C(LGD5 from
LGD6)
RATINGS RATIONALE
The downgrade of Lightstream's PDR to D-PD is a result of the
initial court order received on Sept. 26, 2016, to restructure
under CCAA. Lightstream's other ratings have been affirmed, which
reflects Moody's view on the potential overall family recovery.
Shortly following this rating action, Moody's will withdraw all
ratings of the company consistent with Moody's practice for
companies operating under the purview of creditor protection
wherein information flow typically becomes much more limited.
Lightstream is a Calgary, Alberta-based exploration and production
company with about 25,000 boe of daily production and proved
developed and total proved reserves of 51 million boe and 79
million boe, respectively.
The principal methodology used in these ratings was Global
Independent Exploration and Production Industry published in
December 2011.
LINN ENERGY: Creditors Agree to Extend Plan Filing to Oct. 7
------------------------------------------------------------
Linn Energy, LLC disclosed in a regulatory filing with the
Securities and Exchange Commission that on September 23, 2016, the
Debtors and certain of consenting creditors entered into a Second
Amendment to Restructuring Support Agreement, which extended the
date by which the Plan (or Plans, if separate), the Plan
Solicitation Materials (as defined in the Restructuring Support
Agreement) for the Plan (or Plans, if separate), and the motion or
motions to approve the Disclosure Statement (or Disclosure
Statements, if separate, and as defined in the Restructuring
Support Agreement) must be filed with the Court from 135 days to
149 days following the Petition Date -- Oct. 7, 2016.
Prior to the filing of the Bankruptcy Petitions, on May 10, 2016,
the Debtors entered into the Restructuring Support Agreement with
certain holders collectively holding or controlling at least 66.67%
by aggregate outstanding principal amounts under (i) the Company's
Sixth Amended and Restated Credit Agreement, dated as of April 24,
2013 and (ii) Berry Petroleum Company, LLC's Second Amended and
Restated Credit Agreement, dated as of November 15, 2010. The
Restructuring Support Agreement sets forth, subject to certain
conditions, the commitment of the Debtors and the Consenting
Creditors to support a comprehensive restructuring of the Debtors'
long-term debt, which will be effectuated through one or more plans
of reorganization to be filed in the Chapter 11 Cases.
A copy of the Second Amendment to Restructuring Support Agreement,
dated as of September 23, 2016, by and among the Debtors and the
supporting parties thereto, is available at https://is.gd/lvP3LP
The Company filed with the SEC a redacted copy of the Creditor
Signature Pages.
About Linn Energy
Headquartered in Houston, Texas, Linn Energy, LLC, and its
affiliates are independent oil and natural gas companies. Each
of Linn Energy, LLC, and 14 of its subsidiaries filed a voluntary
petition under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex.
Lead Case No. 16-60040) on May 11, 2016. The petitions were
signed by Arden L. Walker, Jr., chief operating officer of LINN
Energy.
The Debtors have hired Paul M. Basta, Esq., Stephen E. Hessler,
Esq., Brian S. Lennon, Esq., James H.M. Sprayregen, Esq., and
Joseph M. Graham, Esq., at Kirkland & Ellis LLP and Kirkland &
Ellis International LLP as general bankruptcy counsel, Jackson
Walker L.L.P. as co-counsel, Lazard Freres & Co. LLC as financial
advisor, AlixPartners as restructuring advisor and Prime Clerk LLC
as claims, notice and balloting agent.
Judge David R. Jones presides over the cases.
The Office of the U.S. Trustee has appointed five creditors of
Linn Energy LLC to serve on the official committee of unsecured
creditors.
Proposed Texas Oil & Gas Counsel to the Official Committee of
Unsecured Creditors:
John P. Melko, Esq.
David S. Elder, Esq.
Michael K. Riordan, Esq.
Gardere Wynne Sewell LLP
2000 Wells Fargo Plaza
1000 Louisiana Street
Houston, TX 77002
Telephone: (713) 276-5500
Facsimile: (713) 276-5555
E-mail: jmelko@gardere.com
delder@gardere.com
sbeausoleil@gardere.com
Counsel to the Official Committee of Unsecured Creditors are:
Mark I. Bane, Esq.
Keith H. Wofford, Esq.
Ropes & Gray LLP
1211 Avenue of the Americas
New York, NY 10036-8704
Telephone: (212) 596-9000
Facsimile: (212) 596-9090
E-mail: mark.bane@ropesgray.com
keith.wofford@ropesgray.com
The Committee has tapped Moelis & Company LLC as investment banker.
LINN ENERGY: Hearing on Bid to Hire Moelis Adjourned Sine Die
-------------------------------------------------------------
The hearing to consider approval of the application of the Official
Committee of Unsecured Creditors of Linn Energy, LLC, and its
affiliated debtors to retain Moelis & Company LLC as investment
banker, has been adjourned to a date and time to be determined.
The deadline to file an objection to the Application has been
extended, solely for the United States Trustee, to a date also to
be determined. When a new hearing date and UST Objection Deadline
for the Application have been determined, the Official Committee
will file and serve a supplemental notice with that information on
all parties in interest entitled to the notice.
The Committee filed the Application on Aug. 4, 2016. The
Committee, however, requests that the Court approve the firm's
retention, nunc pro tunc to June 16, 2016, which is the date on
which the Committee selected Moelis and the firm commenced
providing services to the Committee.
The Committee said its selection of Moelis as investment banker
reflects the panel's belief that Moelis' general restructuring
experience and expertise and its knowledge of capital markets make
Moelis the best candidate for the services to be provided, and that
the proposed fee structure is competitive and appropriate given the
Committee's understanding of the facts and circumstances of these
Chapter 11 Cases.
Moelis will provide these services to the Committee:
-- assist the Committee in reviewing and analyzing the
Debtors' results of operations, financial condition, and business
plan;
-- assist the Committee in reviewing and analyzing any
potential Restructuring and, to the extent requested, assist the
Committee in soliciting and developing alternative proposals for a
Restructuring;
-- assist the Committee in evaluating the Debtors' debt
capacity and in the determination of an appropriate capital
structure for the Debtors;
-- advise and assist the Committee and, if the Committee
requests, participate in negotiations of any Restructuring;
-- be available to meet with the Committee, the Debtors'
management, the Debtors' board of directors, and other creditor
groups, equity holders, or other parties in interest (in each case
who are institutional parties or represented by an advisor) to
discuss any Restructuring;
-- participate in hearings before the Court and provide
testimony, including as an expert witness, on matters mutually
agreed upon in good faith; and
-- provide other financial advisory and investment banking
services in connection with any Restructuring as Moelis and the
Committee may mutually agree upon in good faith.
Moelis does not provide, and will not be providing, legal, tax,
accounting, or actuarial advice.
The Committee is also seeking to retain Conway MacKenzie, Inc., to
provide distinct financial advisory services complementary to those
provided by Moelis. At the Committee's request, representatives of
CM and Moelis have met to address an appropriate and efficient
division of responsibilities. While both Moelis and CM recognize
that it is difficult to predict how these Chapter 11 Cases will
proceed, they will undertake to coordinate all of their services to
the Committee in order to minimize, wherever possible, any
unnecessary duplication of services and any potential burden on the
Debtors and their professional advisors.
The Committee proposes that Moelis be paid these fees:
-- Monthly Fee. During the term of Moelis' engagement, as set
forth in the Engagement Letter, a fee of $150,000 per month payable
in advance of each month. The Debtors will pay all Monthly Fees
that have been incurred since June 16, 2016 immediately upon entry
of an order approving this Application, and all subsequent Monthly
Fees prior to each monthly anniversary of the date of the
Engagement Letter. Whether or not a Restructuring has taken place
or will take place, Moelis shall earn
and be paid the Monthly Fee every month during the term of the
Engagement Letter.
-- Restructuring Fee. At the closing of a Restructuring, a
fee of $3,750,000. For the avoidance of doubt, in no event shall
Moelis, pursuant to this clause (b), earn more than $3,750,000.
-- Expert Testimony Fee. If Moelis provides expert testimony
services, a fee of $500,000.00. If Moelis provides a written
expert report, a fee of $1,500,000.00. For the avoidance of doubt,
in no event shall Moelis, pursuant to this clause (c), earn more
than $1,500,000.00.
If at any time during the 18 months following the expiration or
termination of the Engagement Letter -- Tail Period -- (i) the
Debtors (or any entity formed or invested in to consummate a
Restructuring) consummates a Restructuring or enters into an
agreement for a Restructuring, or (ii) a plan is filed regarding a
Restructuring and a Restructuring is subsequently consummated at
any time, then the Debtors (or any entity formed or invested in to
consummate a Restructuring) and their bankruptcy estates shall pay
Moelis the Restructuring Fee immediately upon the closing of such
transaction.
Any payments made to Moelis' outside legal counsel will be subject
to the U.S. Trustee Guidelines, the Complex Rules, and sections 330
and 331 of the Bankruptcy Code, without regard to whether such
attorneys have been retained under section 327 of the Bankruptcy
Code and without regard to whether such attorneys' services satisfy
section 330(a)(3)(C) of the Bankruptcy Code.
As part of the overall compensation payable to Moelis under the
terms of the Engagement Letter, the Committee has agreed to the
terms of certain indemnification, contribution, and reimbursement
obligations.
Robert J. Flachs, managing director of Moelis, disclosed that prior
to the formation of the Committee, Moelis was engaged by Milbank,
Tweed, Hadley & McCloy LLP, in its capacity as counsel to an ad hoc
group of certain holders of the $3.1 billion aggregate principal
amount of 6.5% Senior Notes due 2019, 6.25% Senior Notes due 2019,
8.625% Senior Notes due 2020, 7.75% Senior Notes due 2021, and 6.5%
Senior Notes due 2021 issued by LINN Energy, LLC. Consistent with
section 1103(b) of the Bankruptcy Code, the representation did not
constitute representation of an adverse interest. Moreover,
Moelis' engagement by Milbank ceased upon being retained by the
Committee. Prior to the Petition Date, the Debtors paid Moelis
$314,468.00 for fees and expenses related to Moelis' engagement by
Milbank.
Mr. Flachs attests that Moelis (i) is a "disinterested person"
within the meaning of section 101(14) of the Bankruptcy Code; (ii)
does not hold or represent an interest materially adverse to the
Debtors' estates; and (iii) has no connection to the Debtors, their
creditors, or related parties.
The firm may be reached at:
Robert J. Flachs
Managing Director
Moelis & Company
1999 Avenue of the Stars, Suite 1900
Los Angeles, CA 90067
Office: 310-443-2326
E-mail: Robert.Flachs@moelis.com
About Linn Energy
Headquartered in Houston, Texas, Linn Energy, LLC, and its
affiliates are independent oil and natural gas companies. Each
of Linn Energy, LLC, and 14 of its subsidiaries filed a voluntary
petition under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex.
Lead Case No. 16-60040) on May 11, 2016. The petitions were
signed by Arden L. Walker, Jr., chief operating officer of LINN
Energy.
The Debtors have hired Paul M. Basta, Esq., Stephen E. Hessler,
Esq., Brian S. Lennon, Esq., James H.M. Sprayregen, Esq., and
Joseph M. Graham, Esq., at Kirkland & Ellis LLP and Kirkland &
Ellis International LLP as general bankruptcy counsel, Jackson
Walker L.L.P. as co-counsel, Lazard Freres & Co. LLC as financial
advisor, AlixPartners as restructuring advisor and Prime Clerk LLC
as claims, notice and balloting agent.
Judge David R. Jones presides over the cases.
The Office of the U.S. Trustee has appointed five creditors of Linn
Energy LLC to serve on the official committee of unsecured
creditors. The Committee tapped Mark I. Bane, Esq., and Keith H.
Wofford, Esq., at Ropes & Gray LLP; and Moelis & Company LLC as
investment banker. It also retained as Texas Oil & Gas Counsel,
John P. Melko, Esq., David S. Elder, Esq., and Michael K. Riordan,
Esq., at Gardere Wynne Sewell LLP.
LRI HOLDINGS: Court OKs Plan Outline; Nov. 9 Conf. Hearing Set
--------------------------------------------------------------
BankruptcyData.com reported that LRI Holdings filed with the U.S.
Bankruptcy Court a First Amended Joint Plan of Reorganization and
related Disclosure Statement. According to the Disclosure
Statement, "On September 20, 2016, the Debtors, Creditors'
Committee and the parties to the Restructuring Support Agreement
agreed to the Creditors' Committee Settlement to resolve in
principle the objections that the Creditors' Committee raised
regarding the DIP Facilities, the Restructuring Support Agreement,
and the Plan and Disclosure Statement. That resolution is now
reflected in the Final DIP Order and Plan. Pursuant to the
Creditors' Committee Settlement, the treatment of holders of
General Unsecured Claims is improved by (i) an increase in the
amount of cash in the General Unsecured Claims Pool from $350,000
to a total of $1 million, (ii) a waiver of deficiency claims on
account of the Notes and all other unsecured claims held by the
Unanimous Supporting Noteholders, (iii) the waiver and release of
all Avoidance Actions by the Debtors and Reorganized Debtors, and
(iv) the appointment of an Ombudsman with consultation rights
regarding the allowance of general unsecured claims, subject to
certain thresholds. The Creditors' Committee Settlement will also
provide an estimated $5 million of increased liquidity for the
benefit of the Reorganized Debtors through a combination of adding
an additional $3.5 million of 'new money' loans under the Exit
Second Lien Facility and an estimated $1.5 million reduction in the
Cash-Out Payment as a result of lowering the threshold to determine
which holders of Unexchanged Notes Claims will receive a Cash-Out
Payment. [A]s a result of the benefits of the global settlement to
General Unsecured Creditors -- in the form of increased recoveries
and strengthening the Reorganized Debtors' financial position at
emergence -- the Creditors' Committee agreed to support
confirmation of the Plan, including the settlements and releases
embodied in the Plan."
According to the report, the Court subsequently approved the
Disclosure Statement and scheduled a November 9, 2016 Plan
confirmation hearing.
About Roadhouse Holding Inc.
Roadhouse Holding Inc. was founded in 2010 and is based in New
York. Roadhouse Holding, along with seven affiliates, which include
Logan's Roadhouse Inc. and LRI Holdings Inc., filed
for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No.
16-11819) on Aug. 8, 2016.
Roadhouse Holding, et al., are represented by Robert S. Brady,
Esq., Edmon L. Morton, Esq., Ryan M. Bartley, Esq., Elizabeth S.
Justison, Esq., and Norah M. Roth-Moore, Esq., at Young Conaway
Stargatt & Taylor, LLP.
Hilco Real Estate, LLC, serves as real estate advisor to the
Debtors; Jefferies LLC serve as financial advisor; and Donlin
Recano & Company as claims and noticing agent.
Andrew Vara, acting U.S. trustee for Region 3, on August 19
appointed five creditors of Roadhouse Holding Inc. to serve on
the official committee of unsecured creditors.
Dechert LLP and Ashby & Geddes, P.A., serve as counsel to (a)
BOKF, NA, as successor to Wells Fargo Bank, National Association,
as trustee and collateral agent under that certain Senior Secured
Notes Indenture, dated as of Oct. 4, 2010; (b) Carl Marks
Management Company, LLC; and (c) Marblegate Asset Management, LLC.
LUCAS ENERGY: Supplements Current Report on APA Closing
-------------------------------------------------------
Lucas Energy, Inc., has amended its current report on Form 8-K
dated Aug. 25, 2016, and filed with the Securities and Exchange
Commission on Aug. 31, 2016. The Form 8-K was filed to report,
among other things, the closing of the transactions contemplated by
the Asset Purchase Agreement dated Dec. 30, 2015, as amended by the
First Amendment to Asset Purchase Agreement dated April 20, 2016
and effective April 1, 2016, and the Second Amendment to Asset
Purchase Agreement dated Aug. 25, 2016.
In connection with the Closing, the Company acquired working
interests in producing properties and undeveloped acreage in Texas
and Oklahoma, including varied interests in two largely contiguous
acreage blocks in the liquids-rich Mid-Continent region of the
United States, and related wells, leases, records, equipment and
agreements associated therewith as well as producing shale
properties in Glasscock County, Texas, from the Sellers.
The Company amended the Current Report to supplement the Form 8-K
to include the financial statements and pro forma financial
information required by Item 9.01. A full-text copy of the Form
8-K/A is available for free at https://is.gd/pgWOJp
About Lucas Energy
Based in Houston, Texas, Lucas Energy (NYSE MKT: LEI) --
http://www.lucasenergy.com/-- is a growth-oriented, independent
oil and gas company engaged in the development of crude oil,
natural gas and natural gas liquids in the Hunton formation in
Central Oklahoma in addition to the Austin Chalk and Eagle Ford
formations in South Texas.
Lucas Energy reported a net loss of $25.4 million for the year
ended March 31, 2016, compared to a net loss of $5.12 million for
the year ended March 31, 2015.
As of June 30, 2016, Lucas Energy had $14.73 million in total
assets, $12.91 million in total liabilities and $1.82 million in
total stockholders' equity.
Hein & Associates LLP, in Houston, Texas, issued a "going concern"
qualification on the consolidated financial statements for the year
ended March 31, 2016, citing that the Company has incurred
significant losses from operations and had a working capital
deficit of $9.6 million at March 31, 2015. These factors raise
substantial doubt about the Company's ability to continue as a
going concern.
LUVU BRANDS: Incurs $312,000 Net Loss in Fiscal 2016
----------------------------------------------------
Luvu Brands, Inc. filed with the Securities and Exchange Commission
its annual report on Form 10-K disclosing a net loss of $312,000 on
$16.8 million of net sales for the year ended
June 30, 2016, compared to a net loss of $474,000 on $15.6 million
of net sales for the year ended June 30, 2015.
As of June 30, 2016, Luvu Brands had $3.75 million in total assets,
$6.27 million in total liabilities and a total stockholders'
deficit of $2.52 million.
Liggett & Webb, P.A., in Boynton Beach, Florida, issued a "going
concern" qualification on the consolidated financial statements for
the year ended June 30, 2016, citing that the Company has a net
loss of $312,000, a working capital deficiency of $2.4 million, and
an accumulated deficit of $9.2 million. These factors raise
substantial doubt about the Company's ability to continue as a
going concern.
The Company's Annual Report on Form 10-K is available from the SEC
Web site at
https://is.gd/anza52
About Luvu Brands
Luvu Brands, Inc., formerly known as Liberator, Inc., is a
U.S.-based manufacturer that has built several brands in the
wellness, lifestyle and casual furniture and seating categories.
Its brands are headquartered in Atlanta in a 140,000 square foot
manufacturing facility.
M SPACE: Wants More Time to File Plan as Lender Talks Continue
--------------------------------------------------------------
M Space Holdings, LLC requests the U.S. Bankruptcy Court for the
District of Utah to extend by 120 days the periods during which the
Debtor has the exclusive right to (a) file a Chapter 11 plan,
through and including Jan. 14, 2017, and (b) solicit acceptances of
such plan, through and including March 15, 2017.
The Debtor submits that it has sought for bankruptcy relief with
the intention of liquidating its assets through the assistance of
Gordon Brothers Commercial & Industrial, LLC, but the sales and
marketing have not met the initial projections. However, while
marketing its assets in good faith, the Debtor continues to operate
its business and pay its bills on time.
Currently, the Debtor is still having ongoing negotiations with PNC
Bank, National Association, as agent for itself and HSBC Bank USA,
National Association, regarding their support of a potential plan
of reorganization. The Debtor believes that, if PNC Bank will
agree, it can use certain sales proceeds to generate a sufficient
cash flow to reorganize its business.
In addition, the Debtor continues to be actively engaged in
resolving disputes with creditors, to wit, the Debtor is very close
to settling its disputes regarding the Bison Run project. If
finalized, the settlement would resolve substantial claims against
the estate.
About M Space Holdings
M Space Holdings, LLC, is a provider of turnkey complex modular
space solutions. M Space sought protection under Chapter 11
(Bankr. D. Utah Case No. 16-24384) on May 19, 2016. The petition
was signed by Jeffrey Deutschendorf, CEO and president.
The Debtor is represented by Mona L. Burton, Esq., Sherilyn A.
Olsen, Esq., and Ellen E. Ostrow, Esq., at Holland & Hart LLP. The
case is assigned to Judge Joel T. Marker. The Debtor's asset
Liquidator is Gordon Brothers Commercial & Industrial, LLC.
The Debtor estimated both assets and liabilities of $50 million to
$100 million.
No request has been made for the appointment of a trustee or
examiner, and an official unsecured creditors' committee was
appointed on June 1, 2016
MACELLERIA RESTAURANT: Selling NYC Restaurant Assets for $1.1M
--------------------------------------------------------------
Macelleria Restaurant, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York to authorize the private sale of
substantially all of the Debtor's assets related to its restaurant
business to The Meatpackers, Inc., for $1,100,000.
A hearing on the Motion is set for Oct. 19, 2016 at 10:00 a.m.
Objection deadline is Oct. 12, 2016.
The Debtor formerly owned and operated an Italian steakhouse known
as Macelleria in the heart of New York City's Meatpacking District
("Restaurant"). When the Restaurant opened in 2000, it was located
near Gansevoort Plaza at 48 Gansevoort Street, between Greenwich
Street and Washington Street, New York, New York. At that
location, the Restaurant was constructed from a former downtown
meat locker, with two-story exposed brick walls, hinged doors,
antique butcher blocks, vintage cases, and original 17th century
Dutch stone in the wine cellar, embracing the history of the era
and presenting a unique space for dining, private parties, and
events.
The Debtor's lease with its landlord, Gansevoort Street Ventures,
LLC, whose principal is the same principal as the Debtor's current
landlord, West Village, LLC, ("Landlord"), expired in 2008 and was
renewed for 2 years, on 2 occasions, with periods in excess of 5
months, both before and after, where the Debtor was on a
month-to-month lease, making it difficult to engage in long term
business planning.
In 2014, Landlord refused and ignored repeated requests to extend
the Debtor's lease. As a result, in 2015, the Debtor began
exploring alternative locations, and ultimately took an assignment
of lease ("Lease") for the restaurant space across the street, at
1-3 Little West 12th Street on Gansevoort Square, which was also
owned by the Landlord. The Lease has 19 years remaining, and
expires on Nov. 15, 2035.
The Debtor's new premises consists of a 4,500 square foot of
restaurant space seating 170 people, with 2 bars, 40 foot of
frontage, two party rooms, exhibit kitchen, sidewalk cafe on the
first floor, and on the lower level, one of the bars, prep kitchen,
and 5 bathrooms. The premises has been partially built out and the
Debtor has obtained and maintained current all permits.
Given the Debtor's past difficulties with the Landlord, the Debtor
explored the option of selling and assigning the Lease. After
consulting with an attorney, the Debtor was informed that it could
assign the Lease to a qualified assignee.
To that end, the Debtor began marketing the sale of the Restaurant.
These efforts procured one serious party, which invested hundreds
of thousands of dollars into acquiring the Restaurant, including
hiring engineers, designers, and architects. The buyer was backed
by a large private equity group and was more than financially
qualified. However, after nearly 1 year of working on the
assignment of the Lease, these efforts fell through when the
Landlord unreasonably withheld its consent to the assignment of the
Lease in May, 2016, leaving the Debtor with mounting debt in excess
of $1,600,000.
Additionally, in desperation and in an effort to obtain consent
from the Landlord for the assignment of the Lease, as early as
March 2016 and again in May 2016, the Debtor offered to pay the
Landlord a portion of the sales price, which offer was ultimately
rejected by the Landlord after additional delays and unreasonable
monetary demands by the Landlord. Upon information and belief, the
buyer has since moved onto another project and has entered into 2
other leases in New York City with other landlords the past year.
Subsequently, the Debtor retained Great American Brokerage, Inc.
("Broker") to market and sell the New Lease, and the Debtor's
assets located at the Restaurant. Although the initial terms of the
agreement with Broker expired, the Broker has continued its efforts
to scour the market and pursue leads to procure another purchaser.
On Sept.15, 2016, the Debtor received an offer from the Purchaser.
After several rounds of negotiations, the parties agreed to a
purchase price of $1,100,000, all cash, no contingencies, and an
immediate closing.
On Sept. 26, 2016, after arms-length negotiations, the Debtor and
the Purchaser entered into the Asset Purchase Agreement ("APA"),
and tender the $110,000 downpayment, which is currently being held
in escrow by DelBello Donnellan Weingarten Wise & Wiederkehr, LLP.
A copy of the APA attached to the Motion is available for free at:
http://bankrupt.com/misc/Macelleria_Restaurant_38_Sales.pdf
Subject to the Court's approval of higher and/or better offers
through an auction process, the Debtor seeks approval to sell the
assets to the Purchaser on these terms and conditions:
a. Seller: Macelleria Restaurant, Inc.
b. Purchaser: The Meatpackers, Inc.
c. Purchase Price: $1,100,000 payable as follows: (i) $110,000
downpayment currently held in escrow by DelBello Donnellan
Weingarten Wise & Wiederkehr, LLP ("Downpayment"), and (ii)
$990,000 payable at closing ("Closing Payment").
d. Acquired Assets: The Debtor would sell to Purchaser, all of
its right, title and interest, if any, in and to the following
assets associated with the Business: (i) all of Debtor's rights
title and interest in and to that Lease, as amended from time to
time, for the premises known as 1-3 Little West 12th Street, New
York, NY 10014 ("Premises"), together with all improvements made to
the Premises, (ii) all security deposits and other deposits,
applications, licenses and permits, and (iii) all of the Debtor's
rights, title and interest in and to any and all Permits, licenses,
approvals and authorizations by a federal, state, local or foreign
governmental or non-governmental board, bureau, agency or
regulatory body, to the extent transferable or assignable.
e. Terms: The Acquired Assets will be transferred at Closing on
an "as is where is" basis free and clear of all liens, claims,
security interests and encumbrances.
f. Closing Date: No later than 10 days after entry of the Sale
Approval Order.
Following the consummation of the private sale to the Purchaser,
the Debtor estimates these distributions under a chapter 11 plan:
Purchase Price: $1,100,000
Professional Fees:
Brokers: $100,000
Attorneys: $75,000
Accountants: $25,000
Landlord (through 10/31/2016) $480,000
, less the Debtor's claims to be adjudicated
NYS Dept Tax & Finance: $107,000
Secured Claim (Julie Darwent): $27,500
Other Secured Claims: $45,000
City of New York: $100,000
Estimated US Trustee Fees: $6,825
Estimated Remaining for Gen. Unsec. Creditors: $88,675
(Approx. 8% Distribution)
In connection with, and ancillary to, the Debtor's request for
approval of the APA, the Debtor seeks authority to assume and
assign its interest in the Lease. The Landlord will receive, from
the purchase price, its cure amount, in such amount to be allowed
by the Court, or otherwise agreed upon between the Debtor and the
Landlord, and the Lease will be deemed in full force and effect and
free of any defaults or purported termination thereunder.
The principal of the Purchaser is Christophe Perrin, a well-known
celebrity chef with 25 years of experience. The Curriculum Vital
of Chef Perrin will be provided to Landlord as part of the due
diligence package related to assignment of the Lease.
Given the substantial marketing of the Debtor's assets both pre-
and post-petition, the lack of any other offer to date, the
significant cash purchase price being offered by the Purchaser, the
continued deterioration of the Debtor's estate to the detriment of
the unsecured creditors, and the Purchaser's desire to close Oct.
31, 2016, the Debtor believes that the private sale is justified
and the best way to maximize value and save jobs. It is extremely
unlikely that an overbid process will generate higher and better
offers for the Debtor's assets.
The Purchaser:
Georges Vila
President
THE MEATPACKERS, INC.
c/o BANYM, Inc.
1270 Broadway, Suite 806
New York, NY 10001
The Purchaser is represented by:
Nathaniel Muller, Esq.
1270 Broadway, Suite 806
New York, New York 10001
Telephone: (646) 256-6003
Telecopier: (212) 244-4232
E-mail: nm@legalmuller.com
About Macelleria Restaurant
Macelleria Restaurant, Inc., based in New York, NY, filed a Chapter
11 petition (Bankr. S.D.N.Y. Case No. 16-12110) on July 25, 2016.
The Hon. Mary Kay Vyskocil presides over the case. Julie Cvek
Curley, Esq., and Jonathan S. Pasternak, Esq., at Delbello
Donnellan Weingarten Wise & Wiederkehr, LLP, as bankruptcy
counsel.
In its petition, the Debtor estimated $1.10 million to $1.58
million in both assets and liabilities. The petition was signed by
Violetta Bitici, president.
No official committee of unsecured creditors has been appointed in
the case.
MARSHA ANN RALLS: Hearing on Plan Disclosures Set For Oct. 19
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Columbia has
scheduled for Oct. 19, 2016, at 2:00 p.m. the hearing to consider
the approval of Marsha Ann Ralls' disclosure statement.
The Debtor filed the Disclosure Statement and a Chapter 11 plan on
Sept. 1, 2016.
Marsha Ann Ralls filed for Chapter 11 bankruptcy protection (Bankr.
D.D.C. Case No. 16-00222) on May 4, 2016. William C. Johnson Jr.,
Esq., at the Law Offices of William C. Johnson, Jr., serves as the
Debtor's bankruptcy counsel.
MATTRESS FIRM: S&P Withdraws 'B+' Corporate Credit Rating
---------------------------------------------------------
S&P Global Ratings withdrew its ratings on Mattress Firm Holding
Corp., including the 'B+' long-term corporate credit rating, at the
company's request. Prior to withdrawal, the ratings were on
CreditWatch with positive implications, where S&P placed them on
Aug. 8, 2016.
The withdrawal follows Steinhoff International Holdings N.V.'s
(Steinhoff) completed acquisition of the company. Steinhoff now
controls Mattress Firm Holding Corp. and has repaid its previously
rated debt. In S&P's view, Mattress Firm Holding Corp. would
continue to benefit from long-term financial support from its
parent and main shareholder, Steinhoff, enabling the company to
meet its liquidity needs over the coming 12 months despite
competitive retail market conditions.
MAX EXPRESS: Seeks Oct. 31 Extension of Plan Filing Period
----------------------------------------------------------
Max Express, Inc. asks the U.S. Bankruptcy Court for the Central
District of California to extend its exclusive period to file a
plan and disclosure statement from September 29, 2016 to October
31, 2016.
The Debtor tells the Court that it hopes to emerge from the
bankruptcy by confirming a plan of reorganization. The Debtor
further tells the Court that in order to file a plan and disclosure
statement, enough time needs to pass to:
(1) allow the Debtor to establish a history of financial
performance after its change in business model from independent
contractor truck drivers to hourly employee truck drivers and
utilize the new model to assess profitability and provide
projections supporting feasibility of any proposed plan; and
(2) allow the Debtor to resolve the objections it has to the
filed claims.
The Debtor contends that while it expects to file a plan and
disclosure statement by October 31, 2016, it is unable to file a
plan and disclosure statement by September 29, 2016.
About Max Express, Inc.
Max Express, Inc., is a trucking company located in Carson,
California that provides trucking services throughout the western
United States. It has approximately 30 trucks and 37 employees,
including the truck drivers and principals of the Debtor. The
Debtor currently rents real property located at 22420 S. Alameda 10
Street, Carson, CA 90810, for the premises used as its place of
business.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. C.D. Cal. Case No. 16-14868) on April 15, 2016. The
petition was signed by Richard Mo, secretary. The case is assigned
to Judge Deborah J. Saltzman. The Debtor estimated both assets and
liabilities in the range of $1 million to $10 million.
The Office of the U.S. Trustee on June 10, 2016, appointed three
creditors of Max Express, Inc., to serve on the official committee
of unsecured creditors. The Committee retained Levene, Neale,
Bender Yoo & Brill as its counsel.
MCDONALD BUILDING: Taps Gallagher & Kennedy as Legal Counsel
------------------------------------------------------------
McDonald Building, LLC seeks approval from the U.S. Bankruptcy
Court for the District of Arizona to hire legal counsel in
connection with its Chapter 11 case.
The Debtor proposes to hire Gallagher & Kennedy, P.A. to provide
legal services, which include assisting the Debtor in preparing a
Chapter 11 plan.
John Clemency, Esq., and Lindsi Weber, Esq., the attorneys expected
to represent the Debtor, will be paid $595 per hour and $395 per
hour, respectively.
Other G&K attorneys and paralegals may also render services to the
Debtor. The firm's hourly rates range from $390 to $625 for
shareholders, $340 to $385 for associates, and $250 to $260 for
paralegals.
G&K does not hold or represent any interest adverse to the Debtor,
according to court filings.
The firm can be reached through:
John R. Clemency, Esq.
Lindsi M. Weber, Esq.
Janel M. Glynn, Esq.
Gallagher & Kennedy, P.A.
2575 East Camelback Road
Phoenix, Arizona 85016-9225
Telephone: (602) 530-8000
Facsimile: (602) 530-8500
Email: john.clemency@gknet.com
Email: lindsi.weber@gknet.com
Email: janel.glynn@gknet.com
About McDonald Building
McDonald Building, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Ariz. Case No. 16-10430) on September 9,
2016. The petition was signed by Ceasar A. Perez, manager.
The case is assigned to Judge Madeleine C. Wanslee.
At the time of the filing, the Debtor estimated its assets and
debts at $1 million to $10 million.
At the time of the filing, the Debtor estimated assets of less than
$ and liabilities of $ million to $ million.
MCKEESPORT AREA SD: Moody's Affirms Ba1 GO Rating, Outlook Neg.
---------------------------------------------------------------
Moody's Investors Service has affirmed the Ba1 underlying general
obligation rating and Baa2 enhanced rating on McKeesport Area
School District, PA's $125.4 million in outstanding general
obligation debt. The outlook on both ratings is negative.
The Ba1 reflects the district's heavily burdensome debt, increasing
charter school pressure, and narrowing finances. It also reflects
the district's reliance on refinancing to fix current financial
pressure, coupled with the district's limited revenue generating
capabilities.
The Baa2 post-default enhanced rating reflects Moody's assessment
of each issuer participating in the Programs pursuant to the
methodology, "State Aid Intercept Programs and Financings: Pre and
Post Default." Credit considerations include availability of funds,
timing of state aid payments, state aid trend, strength of
notification requirement, and timing between notification and
intercept. Additional credit factors include a debt service
coverage ratio and the underlying ratings of the individual school
districts.
Rating Outlook
The negative outlook on the underlying reflects the challenges the
district will face while returning to structural balance and
rebuilding reserves due to increasing fixed costs. The enhanced
rating has a negative outlook based on this rule: For underlying
ratings at the post-default ceiling (A3) or higher, the outlook is
the same as the commonwealth's. For underlying ratings one or two
notches below the ceiling (Baa1 or Baa2), the outlook is the lower
of the outlook on the underlying or on the commonwealth. For
underlying ratings three notches below the ceiling (Baa3) or lower,
the outlook is the same as the underlying.
Factors that Could Lead to an Upgrade
Multiyear trend of reserve growth
Significant tax base expansion
Material declines in fixed costs
Reduced charter school pressure on the budget
Factors that Could Lead to a Downgrade
Declines in reserve and liquidity levels
Material declines in the tax base
Significant increases in the debt burden that further pressure
the financial position
Legal Security
The district's bonds are secured by its general obligation pledge
with some series subject to Act 1 property tax limitations.
Use of Proceeds
Not applicable.
Obligor Profile
The district is located in Allegheny County, 15 miles southeast of
Pittsburgh and serves approximately 3,550 students in McKeesport
City, South Versailles Township, and the Boroughs of Dravosburg,
Versailles, and White Oak.
Methodology
The principal methodology used in the underlying rating was US
Local Government General Obligation Debt published in January 2014.
The principal methodology used in the enhanced rating was State
Aid Intercept Programs and Financings: Pre and Post Default
published in July 2013.
MICHAEL D. COHEN: Seeks to Hire Cole Schotz as Legal Counsel
------------------------------------------------------------
Michael D. Cohen, M.D., P.A. seeks approval from the U.S.
Bankruptcy Court for the District of Maryland to hire Cole Schotz
P.C. as its legal counsel.
The firm will provide these services in connection with the
Debtor's Chapter 11 case:
(a) advising the Debtor regarding its rights, powers and
duties;
(b) assisting the Debtor in negotiation and documentation of
financing agreements, cash collateral orders and related
transactions;
(c) reviewing the nature and validity of agreements relating
to the Debtor’s business and properties;
(d) reviewing the nature and validity of liens asserted
against the Debtor;
(e) preparing legal papers; and
(f) advising the Debtor in connection with the formulation,
negotiation and implementation of Chapter 11 plans and
related documents.
The firm's professionals and their hourly rates are:
Members $430 - $895
Special Counsel $420 - $510
Associates $250 - $475
Paralegals $175 - $285
Litigation Support $295 - $395
Specialists
Project Assistants $75 - $200
The individuals expected to provide legal services to the Debtor
and their hourly rates are:
Irving Walker Member $600
Jonathan Grasso Associate $310
Pauline Ratkowiak Paralegal $275
Jennifer Donaghy Proj. Assistant $100
In a court filing, Mr. Walker disclosed that the firm is a
"disinterested person" as defined in section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Irving E. Walker, Esq.
Cole Schotz P.C.
300 E. Lombard Street, Suite 1450
Baltimore, MD 21202
Tel: (410) 230-0660
About Michael D. Cohen, M.D.
Based in Maryland, Michael D. Cohen, M.D., P.A. dba Cosmetic
Surgery Center of Maryland dba Belcara Health, dba Belcara, is a
professional corporation engaged in the business of providing
various physician services to its patients, including but not
limited to services in the areas of plastic surgery, dermatology,
and podiatry. Michael D. Cohen, M.D., is the sole shareholder of
the Debtor. Shari L. Cohen, Dr. Cohen's wife, is responsible for
the business administration of the Debtor's medical practice.
The Company filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. D. Md. Case No. 16-22231) on Sept. 12,
2016. The Debtor estimated assets in the range of $100,000 to
$500,000 and liabilities in the range of $1 million to $10 million
as of the bankruptcy filing.
The Debtor is represented by Irving Edward Walker, Esq., at Cole
Schotz P.C.
MICHAEL ROBERT WIGLEY: 8th Circ. BAP Junks Lariat Co.'s Appeal
--------------------------------------------------------------
In the case captioned Lariat Companies, Inc., Creditor-Appellant,
v. Michael Robert Wigley, Debtor-Appellee, Barbara Wigley,
Interested party-Appellee, No. 16-6008, in relation to bankruptcy
case In re: Michael Robert Wigley, Debtor, the United States
Bankruptcy Appellate Panel for the Eighth Circuit affirmed (1) the
bankruptcy court's November 18, 2015 order denying Lariat's request
to dismiss the Chapter 11 case of the debtor or to convert the case
to Chapter 7, denying confirmation of the Debtor's second modified
Chapter 11 plan, and establishing deadlines for the Debtor to file
a modified plan and obtain confirmation of it (November 18 Order);
and (2) the bankruptcy court's February 18, 2016 order confirming
the Debtor's fourth modified Chapter 11 plan.
The main issue on appeal is whether the bankruptcy court properly
denied Lariat's request to dismiss the Debtor's case or convert it
to Chapter 7, resulting in the ultimate confirmation of the
Debtor's fourth modified Chapter 11 plan.
This court sees no error with the bankruptcy court's findings that
the Debtor was in financial distress, and that he filed his Chapter
11 petition to maximize the value of his assets and to obtain the
benefits of the Bankruptcy Code. Likewise, we see no parallel to
the Eighth Circuit's Cedar Shore Resort, Inc. case where the
Chapter 11 filing was dismissed as being in bad faith because it
was made for the purpose of preventing creditors from pursuing
claims in state court, rather than to effectuate a valid bankruptcy
purpose, the BAP said.
A full-text copy of the Opinion dated September 21, 2016 is
available at https://is.gd/KAjGqP from Leagle.com.
Kurt Anderson, Esq. for Creditor-Appellant.
Thomas Gregory Wallrich, Esq. for Debtor-Appellee.
Mychal A. Bruggeman, Esq. -- Mychal@mantylaw.com -- Manty &
Associates, P.A. for Interested party-Appellee.
Jacqueline J. Williams, Esq. -- JWilliams@mantylaw.com -- Manty &
Associates, P.A. for Interested party-Appellee.
Joel David Nesset, Esq. -- jnesset@cozen.com -- Cozen O'Connor for
Debtor-Appellee.
MIDSTATES PETROLEUM: Texas Judge to Confirm Chapter 11 Plan
-----------------------------------------------------------
Jonathan Randles, writing for Bankruptcy Law360, reported that U.S.
Bankruptcy Judge David R. Jones in Texas approved Midstates
Petroleum's plan for restructuring billions of dollars in debt.
The report relates Judge Jones said he would sign an order
confirming the Chapter 11 plan, according to minutes of a courtroom
hearing in Houston on Sept. 28, 2016. Approval of the plan comes
after Midstates resolved remaining disputes over the plan with its
stakeholders.
Representatives of these entities appeared at the hearing:
-- William Guerrieri, Anna Rotman, Patrick King, Matthew
Cavanaugh and Patricia Tomasco for the Debtors,
-- Brian Resnick for Ad Hoc Group of Second Lien Noteholders,
-- Charles Kelley for SunTrust Bank,
-- Richard C. Pedone for Wilmington Trust NA,
-- Mark Hebbeln for Wells Fargo Bank, National Association,
-- Tyson Lomazow for the Cross-Over Ad Hoc Committee,
-- Benjamin Feder, by phone, for UMB Bank,
-- Richard Kincheloe for the United States, and
-- Ken McKay, Greg Werher, Stephen D. Lerner and Norman N.
Kinel for the Official Committee Of Unsecured Creditors.
At the hearing, the Debtor's counsel presented evidence and
testimony regarding confirmation.
According to a docket entry, the Judge signed the Confirmation
order.
Recovery to Unsecured Creditors
Subsequent to filing the Plan on July 13, 2016, the Debtors made
certain technical modifications to the Plan. On Sept. 27, the
Debtors filed a further modified version of the Plan reflecting
settlements implemented through the Plan and announced on the
record at the Confirmation Hearing resolving all claims,
objections, and other disputes raised by the Unsecured Creditors
Committee that is reflected in, among other things, the revised
treatment of Class 7 Claims. The settlement with each entity that
filed confirmatin objections is incorporated in the proposed
revised Confirmation Order.
The Unsecured Creditors Committee has agreed to drop its motion
seeking leave, standing, and authority to prosecute claims on
behalf of the Debtors' estates. The Committee will file that
withdrawal within three days of the date of entry of the
Confirmation Order.
The modified Plan provides that Unsecured 2020 Senior Notes Claims
(Unsecured Notes/General Unsecured Claims in Class 7) will be
Allowed in the aggregate principal amount of $293,626,000.00, plus
interest, fees, costs, and expenses, and the Unsecured 2021 Senior
Notes Claims shall be Allowed in the aggregate principal amount
equal to $347,651,000.00, plus interest, fees, costs, and expenses.
On the Effective Date, or as soon thereafter as reasonably
practicable, except to the extent that a Holder of an Allowed
Unsecured Notes Claim or an Allowed General Unsecured Claim agrees
to less favorable treatment, in full and final satisfaction,
compromise, settlement, release, and discharge of and in exchange
for each Allowed Unsecured Notes Claim or Allowed General Unsecured
Claim, each Holder of an Allowed Unsecured Notes Claim or an
Allowed General Unsecured Claim shall receive its Pro Rata share
of:
(i) 1.25% of the New Common Stock (which shall be subject to
dilution under the Management Incentive Plan, any other
compensation arrangements under the Management Compensation Term
Sheet, and New Common Stock issuable upon exercise of the New
Warrants), and
(ii) the Unsecured Creditor Warrants;
provided that in the event of a Settlement Termination Event, the
Unencumbered Distribution will be shared Pro Rata among all Holders
of Unsecured Notes Claims and General Unsecured Claims, including
the Deficiency Claims.
$170-Mil. New Credit Facility
On the Plan Effective Date, the Reorganized Debtors will enter into
a New Credit Facility with their First Lien Lenders led by SunTrust
Bank, the Administrative Agent, Lender and Issuing Bank. The New
Credit Agreement will consist of New Credit Facility Revolving
Loans and the New Credit Facility Term Loans. On the Effective
Date, the New Credit Facility shall consist of an aggregate
commitment of $170.0 million and shall be deemed fully drawn,
subject to the funding of the $40 million restricted account, which
following the Effective Date, may be applied to reduce the
outstanding amounts under the New Credit Facility Revolving Loans,
but which shall not be available for future borrowing until after
Reorganized Debtors' receipt of a borrowing base redetermination
notice on or about April 1, 2018. The lenders under the New Credit
Facility shall not be entitled to give notice of a borrowing base
redetermination to the Reorganized Debtors until April 1, 2018. The
New Credit Facility shall otherwise be in form and substance (i)
reasonably acceptable to the Debtors and the Requisite Second Lien
Noteholders and (ii) acceptable in all respects to the Requisite
First Lien Lenders.
SunTrust also will make available to Reorganized Midstates a letter
of credit sub-facility of up to $10,000,000.
Midstates Petroleum Company LLC, as borrower is indebted to the
Lenders in an aggregate amount equal to the principal amount
outstanding under the Credit Agreement in the amount of
approximately $249,183,640.00, plus accrued but unpaid interest,
fees, costs and expenses, and has reimbursement obligations in
respect of letters of credit that are outstanding in the aggregate
face amount of approximately $2,840,935.00.
On the Plan effective date, the Lenders shall receive a payment in
cash of an amount not less than $82,024,575, which shall be
allocated among the Lenders on a pro rata basis in accordance with
their respective share of the outstanding principal amount of the
Obligations.
Financial Covenants
(A) Leverage Ratio
As of the last day of any fiscal quarter, commencing December 31,
2016 through the fiscal quarter ended March 31, 2018, the ratio of
Total Indebtedness to EBITDA for the trailing four fiscal quarters
shall not exceed 2.25:1.00; provided that Total Indebtedness and
EBITDA:
(i) for the fiscal quarter ended December 31, 2016,
shall be equal to Total Indebtedness and EBITDA, respectively, for
the fiscal quarter ending on such date multiplied by 4,
(ii) for the fiscal quarter ended March 31, 2017, shall
be equal to Total Indebtedness and EBITDA, respectively, for the
two fiscal quarters ending on such date multiplied by 2 and
(iii) for the fiscal quarter ended June 30, 2017, shall
be equal to Total Indebtedness and EBITDA, respectively, for the
three fiscal quarters ending on such date multiplied by 4/3.
As of the last day of any fiscal quarter, commencing June 30, 2018,
the ratio of Total Indebtedness to EBITDA for the trailing four
fiscal quarters shall not exceed 3.00:1.00.
(B) Interest Coverage
As of the last day of any fiscal quarter, commencing December 31,
2016, the ratio of EBITDA to Interest Expense for the trailing four
fiscal quarters shall not less than 3.00:1.00; provided that EBITDA
and Interest Expense:
(i) for the fiscal quarter ended December 31, 2016,
shall be equal to EBITDA and Interest Expense, respectively, for
the fiscal quarter ending on such date multiplied by 4,
(ii) for the fiscal quarter ended March 31, 2017, shall
be equal to EBITDA and Interest Expense, respectively, for the two
fiscal quarters ending on such
date multiplied by 2 and
(iii) for the fiscal quarter ended June 30, 2017, shall
be equal to EBITDA and Interest Expense, respectively, for the
three fiscal quarters ending on such date multiplied by 4/3.
(C) Capital Expenditures
Beginning with the quarter ended December 31, 2016, Capital
Expenditures shall be capped at:
(a) for the 6 months ending December 31, 2016,
$50,000,000,
(b) for the fiscal year ending December 31, 2017,
$81,000,000,
(c) for the fiscal year ending December 31, 2018,
$85,000,000 and
(d) for the fiscal year ending December 31, 2019,
$78,000,000;
provided, however, that Capital Expenditures in an aggregate amount
up $10,000,000 and used solely for purposes of mitigating the
consequences of a regulatory curtailment issued by the Oklahoma
Corporation Commission shall not be included for purposes of
calculating Capital Expenditures for purposes of the covenant.
If the amount of Capital Expenditures in the Company's Business
Plan:
(a) for the 6 months ending December 31, 2016 is greater
than the amount of Capital Expenditures actually made in such six
month period (the amount by which such Capital Expenditures in the
Company's Business Plan for such six month period exceeds the
actual amount of Capital Expenditures for such six month period in
an aggregate amount up to $10,000,000, the "Initial Excess Amount")
or
(b) for any Fiscal Year is greater than the amount of
Capital Expenditures actually made in such Fiscal Year (the amount
by which such Capital Expenditures in the Company's Business Plan
for such Fiscal Year exceeds the actual amount of Capital
Expenditures for such Fiscal Year in an aggregate amount up to
$10,000,000, the "Excess Annual Amount",
then the Excess Amount -- Carry-Over Amount -- may be carried
forward to the next succeeding Fiscal Year; provided, that the
Carry-Over Amount applicable to a particular Succeeding Fiscal Year
may not be carried forward to another Fiscal Year. Capital
Expenditures made by the Credit Parties in any Fiscal Year shall be
deemed to reduce (x) first, the Carry-Over Amount, and (y) then,
the amount provided for above for such Fiscal Year.
(D) Minimum Liquidity
On the Plan Effective Date, Reorganized Midstates shall fund a cash
collateral account which shall be maintained at the Agent in an
amount equal to $40,000,000.
A redlined copy of the First Amended Plan and the New Credit
Facility Term Sheet is available at:
http://bankrupt.com/misc/txsb16-32237-0691.pdf
A redlined copy of the revised Findings of Fact, Conclusions of
Law, and Order Confirming the First Amended Joint Chapter 11 Plan
is available at:
http://bankrupt.com/misc/txsb16-32237-0691a.pdf
About Midstates Petroleum Company
Midstates Petroleum Company, Inc. --
http://www.midstatespetroleum.com/-- is an independent exploration
and production company focused on the application of modern
drilling and completion techniques in oil and liquids-rich basins
in the onshore U.S. Midstates' drilling and completion efforts are
currently focused in the Mississippian Lime oil play in Oklahoma
and Anadarko Basin in Texas and Oklahoma. The Company's
operations
also include the upper Gulf Coast tertiary trend in central
Louisiana.
Midstates Petroleum Company, Inc., and Midstates Petroleum Company
LLC filed separate Chapter 11 petitions (Bankr. S.D. Tex. Case
Nos.
16-32237 and 16-32238) on April 30, 2016. The petitions were
signed by Nelson M. Haight, executive vice president and chief
financial officer Judge David R Jones presides over the case. As
of
Dec. 31, 2015, the Company listed assets of $679 million and total
debts of $2 billion.
The Debtors have hired Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as lead bankruptcy counsel, Jackson Walker LLP
as
their local and conflicts bankruptcy counsel, and Evercore Group
L.L.C. as investment banker. Kurtzman Carson Consultants LLC
serves as claims and noticing agent.
The Office of the U.S. Trustee, on May 12, 2016, appointed three
creditors to serve on the official committee of unsecured
creditors. The Committee taps Squire Patton Boggs (US) LLP as
counsel, Berkeley Research Group LLC as financial advisor, and
Conway Mackenzie, Inc. as special E&P advisor.
MIMM CONDOMINIUM: Hires Carballo as Special Counsel
---------------------------------------------------
MIMM Condominium Association, Inc., seeks authorization from the
U.S. Bankruptcy Court for the Southern District of Florida to
employ the law firm of Carballo Law, P.A., as Special Counsel, nunc
pro tunc as of September 7, 2016.
Since late August, 2016, Carballo has provided legal services to
the Debtor which consisted of extensive litigation and negotiations
with AFP 103 Corp. in connection with an Amended Final Judgment
held by AFP against the Debtor. The Debtor requires the continued
services of Carballo for two purposes:
(1) Ongoing issues of litigation and negotiation which may arise
with AFP; and
(2) The investigation and prosecution of claims including,
without limitation -- those which the Debtor has or should have
against recalcitrant tenants.
Prosecuting the tenant claims will likely be the heart of the
Debtor’s reorganization.
Carballo will be paid at $325 hourly rates and will be reimbursed
for reasonable out-of-pocket expenses incurred.
Carballo has received a non-refundable retainer in the original
amount of $12,000.00, which was deposited into the trust account of
Carballo. Prior to the filing of the bankruptcy case, the Debtor
paid Carballo a pre-petition retainer in the amount of $6,500, and
incurred pre-petition fees and costs of $10,211.90, leaving an
unpaid pre petition debt of $3,711.90. Carballo has agreed to waive
the receivable. Thus no pre-petition debts remain due from the
Debtor to Carballo.
Joseph A. Carballo, managing partner of Carballo, assured the Court
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtors and their estates.
Carballo can be reached at:
Joseph A. Carballo, Esq.
CARBALLO LAW, P.A.
2355 Salzedo Street, Suite 300
Miami, FL 33134
Tel: 305-673-8300
Email: joe@carballolaw.com
About MIMM Condominium Association
MIMM Condominium Association, Inc. filed a chapter 11 petition
(Bankr. S.D. Fla. Case No. 16-22347) on Sept. 7, 2016. The petition
was signed by Serdar Bozkurt. The Debtor is represented by David
R. Softness, Esq., at David R. Softness, P.A. The case is assigned
to Jay A. Cristol. The Debtor estimated assets at $0 to $50,000
and liabilities at $1 million to $10 million at the time of the
filing.
MMM HOLDINGS: S&P Affirms 'B-' Counterparty Credit Rating
---------------------------------------------------------
S&P Global Ratings said that it affirmed its 'B-' counterparty
credit and secured debt ratings on MMM Holdings Inc. The outlook
was revised to stable from negative.
MMM reported first-half 2016 financial results that were generally
ahead of S&P's expectations. Medicare Advantage (MA) and Medicaid
(Reforma) membership were down 5% and 4%, respectively, versus
year-end 2015. However, first-half revenues increased by 7%
year-over-year, and the adjusted EBIT margin improved to 5.3%
versus 0.2% a year ago. MMM's product/benefit changes (including
network cuts) have hurt membership growth, but medical claims
trends have been favorable. Its Medicaid business, which is
relatively new (the contract started in April 2015), has been
profitable and performing better than S&P's expectations.
"We believe at least some part of MMM's earnings improvement will
be sustainable through the rest of 2016 and 2017. We forecast the
adjusted EBIT margin to hold at 3%-4% for 2016 and improve to 3%-5%
for 2017. For 2017, MMM should benefit from higher MA membership
growth and stronger revenues due to higher STAR quality-based
bonuses/rebates and a new risk adjustment model. MMM will also
benefit from the federal government's one-year moratorium on
Affordable Care Act (ACA) industry taxes in 2017. The spread of the
Zika virus remains a potential earnings risk (17,000 cases
confirmed as of September), but most Puerto Rico health insurers
have yet to report material Zika-related claims," S&P said.
MMM's recent earnings improvement puts it in a better position to
refinance or restructure its significant term loan maturity in
2017. As of June 30, 2016, it had $340.5 million outstanding on
its term loan, which matures Dec. 12, 2017. Under the company's
amendment no. 2 and waiver agreement with its lenders, the company
is not required to make quarterly amortization payments until March
31, 2017, but the amortization waiver period can be extended by
one-month periods through June 30, 2017, if MMM can demonstrate to
its lenders that it is working on a refinancing or strategic
alternative.
If the amortization waiver period is extended as described above,
MMM would only need to make an excess cash flow-based debt payment
on March 31, 2017, and then pay quarterly amortization starting
July 1, 2017, with the remaining balance due on Dec. 12, 2017.
However, if the amortization waiver period is not extended, MMM
would need to pay all previously waived amortization payments
($67 million if this occurs on March 31, 2017).
The stable outlook reflects S&P's view that at least some part of
MMM's recent earnings improvement will be sustainable through the
rest of 2016 and 2017. This should put MMM in a better position to
refinance or restructure its upcoming term loan maturity in 2017.
S&P expects MMM to generate revenue growth of 2%-3% in 2016 and
3%-5% in 2017, with adjusted EBIT margins of 3%-4% in 2016 and
3%-5% in 2017. S&P expects debt/EBITDA of about 3x at year-end
2016 and 2.0x-3.0x in 2017, and EBITDA interest coverage of 3.0x in
2016 and 3.0x-4.0x in 2017.
S&P may lower the ratings on MMM to the 'CCC' category in the next
12 months if earnings deteriorate from current run rates and this
raises the refinancing risk of its term loan. If it becomes
apparent to S&P that MMM will not be able to refinance its debt and
default is inevitable, S&P will lower the rating to 'CC'. An
actual default will result in a 'D' rating.
S&P may raise the rating on MMM to 'B' during the next 12 months if
the company is able to sustain its earnings improvement in 2017 and
is successful in refinancing or restructuring its debt on terms
that reduce its overall financial risk--in terms of the debt
maturity profile and key credit metrics, such as financial leverage
and EBITDA interest coverage.
MORGANS HOTEL: Stockholders Approve SBE Merger Agreement
--------------------------------------------------------
Morgans Hotel Group Co. held a special meeting of stockholders on
Sept. 26, 2016, at which the stockholders:
(1) voted to adopt the agreement and plan of merger, as it may
be amended from time to time, dated as of May 9, 2016,
among the Company, SBEEG Holdings, LLC and Trousdale
Acquisition Sub, Inc. and the other transactions
contemplated by the Merger Agreement, as described in the
Proxy Statement filed by the Company on Schedule 14A on
Aug. 4, 2016;
(2) approved, on an advisory (non-binding) basis, specified
compensation that may become payable to any named executive
officer of the Company in connection with the merger, as
described in the Proxy Statement filed by the Company on
Schedule 14A on Aug. 4, 2016; and
(3) approved the adjournment or postponement of the Special
Meeting for a period of no more than 30 days to solicit
additional proxies, if necessary, if there are insufficient
votes at the time of the Special Meeting to adopt the
Merger Agreement, as described in the Proxy Statement filed
by the Company on Schedule 14A on Aug. 4, 2016.
At the Special Meeting, following the vote and in response to
questions from stockholders regarding the status of SBE's financing
for the merger, representatives of the Company reiterated the
Company's public disclosure that the parties were working on the
financings and further stated that they were confident that the
financing for the SBE merger would be obtained.
As previously disclosed, SBE has not yet obtained consent from the
Company's mortgage lenders for an assumption of the Company's
mortgage debt and continues to engage in discussions with the
mortgage lenders. As previously disclosed, SBE does not currently
have alternative financing in place, and continues to review
refinancing alternatives for the mortgage debt. SBE is in the
process of finalizing the definitive agreements with Yucaipa
Hospitality Investments, LLC, Cain Hoy Enterprises LP and Security
Benefit Corporation on the terms set forth in the term sheets for
the equity and debt financing negotiated at the time the merger
agreement was executed, but those agreements are not yet final and
binding.
The assumption or refinancing of the mortgage debt is a condition
to the obligation of SBE to consummate the merger. As stated in
the Company's proxy disclosure on Sept. 26, 2016, there can be no
assurance that that the mortgage lenders will consent to an
assumption of the mortgage debt, or that SBE will obtain
alternative financing. Consequently, there can be no assurance
that the conditions to the obligation of SBE to complete the merger
will be satisfied.
About Morgans Hotel Group
Based in New York, Morgans Hotel Group Co. (Nasdaq: MHGC) --
http://www.morganshotelgroup.com/-- is widely credited as the
creator of the first "boutique" hotel and a continuing leader of
the hotel industry's boutique sector. Morgans Hotel Group
operates and owns, or has an ownership interest in, Morgans,
Royalton and Hudson in New York, Delano and Shore Club in South
Beach, Mondrian in Los Angeles and South Beach, Clift in San
Francisco, Ames in Boston, and Sanderson and St Martins Lane in
London. Morgans Hotel Group and an equity partner also own the
Hard Rock Hotel & Casino in Las Vegas and related assets. Morgans
Hotel Group also manages hotels in Isla Verde, Puerto Rico and
Playa del Carmen, Mexico. Morgans Hotel Group has other property
transactions in various stages of completion, including projects
in SoHo, New York and Palm Springs, California.
Morgans Hotel reported net income attributable to common
stockholders of $5.45 million on $220 million of total revenues for
the year ended Dec. 31, 2015, compared to a net loss attributable
to common stockholders of $66.6 million on $234 million of total
revenues for the year ended Dec. 31, 2014.
As of June 30, 2016, Morgans Hotel had $512 million in total
assets, $737 million in total liabilities and a total deficit of
$225 million.
MRP GENERATION: Moody's Affirms B1 Rating on Sr. Credit Facility
----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of MRP Generation
Holdings LLC (MRP Gen or Borrower or Project) following a change in
structure to its proposed refinancing transaction that will reduce
debt and increase equity. The affirmation applies to the B2 rating
on MRP's senior secured term loan B following the Borrower's
decision to reduce the size by $40 million to $270 million from
$310 million. In addition, Moody's affirmed the B1 rating to MRP
Gen's super senior revolving credit facility following its
downsizing by $10 million to $20 million from $30 million. The
outlook remains stable.
RATINGS RATIONALE
While the reduction in the debt quantum of the term loan and the
corresponding increase in the size of the equity from MRP Gen's
sponsor are positive factors to the Project's credit profile, the
resulting financial impact is relatively modest. This is because
any potential improvement to the financial metrics are largely
offset by a higher interest margin on the financing, which is going
to 700 bps over LIBOR from 575 bps. Despite the reduction in
leverage, under a Moody's sensitivity case assuming lower pricing
growth, MRP Gen's average 3-year debt service coverage ratio (DSCR)
measures below 2.0 times with a 3-year funds from operations
(FFO)-to-debt averaging below 5.0%. The expected financial metrics
still score in the Caa to B category under the Moody's Power
Generation Projects rating methodology.
Beyond the financial metrics, Moody's notes that the B1/B2 ratings
assigned to the debt instruments also consider the operating track
record of the project, the proven technology used in the plants and
the quality of the sponsorship, which is expected to support the
Project going forward.
For additional information on the transaction, the rating rationale
and outlook, please refer to the press release dated July 28, 2016,
and the credit opinion dated August 2, 2016.
The principal methodology used in these ratings was Power
Generation Projects published in December 2012.
MRP Generation Holdings LLC (MRP Gen) owns 1,380 MW of generating
capacity in CAISO and PJM. The largest plant is the 830 MW High
Desert combined-cycle facility located in Victorville, CA. The
remaining portfolio assets include the 300 MW Big Sandy peaking
facility located in Kenova, WV and the 250 MW Wolf Hills peaking
facility located in Bristol, VA. MRP Gen is indirectly owned by
funds managed by Avenue Capital Group (Avenue Capital), which has
total assets under management of approximately $11.6 billion.
Avenue Capital acquired the portfolio from Tenaska Power Fund, L.P.
in April 2016, and subsequently changed the name of the business to
the current MRP Generation Holdings LLC from the former TPF
Generation Holding, LLC.
MRP GENERATION: S&P Gives Prelim. BB- Rating on New $270MM Loan
---------------------------------------------------------------
S&P Global Ratings said that it assigned its preliminary 'BB-'
rating to MRP Generation Holding LLC's proposed $270 million term
loan B due 2022 and $20 million revolving credit facility due 2021.
The outlook is stable. S&P assigned a preliminary '1' recovery
rating to this debt, indicating expectations for very high
(90%-100%) recovery in the event of a payment default.
The 'B+' rating on the existing term loan B and revolving credit
facility due 2017 is unchanged, but S&P expects to withdraw it at
the close of this transaction, which is intended to repay that
debt. At close, S&P will review the final documentation associated
with the new debt to determine if features of the transaction
structure constrain the rating.
MRP Generation Holdings LLC is a special-purpose, bankruptcy-remote
entity that owns three merchant natural gas-fired power plants in
the PJM and California Independent System Operator (CAISO) markets
with a combined capacity of 1,380 megawatts (MW). The assets are
the 830-MW High Desert Facility, completed in April 2003; the
300-MW Big Sandy facility, completed in June 2001; and the 250-MW
facility Wolf Hills, completed in May 2001. High Desert sells
energy and capacity into CAISO near Los Angeles, while Big Sandy
and Wolf Hills sell energy, capacity, and ancillary services into
the PJM American Electric Power zone (AEP).
The 'BB-' rating on the new project debt reflects its operations
phase stand-alone credit profile and favorable comparison to
peers.
Operations Phase SACP: 'bb-'
Credit Strengths:
-- The refinancing reduces project-level debt by about
$140 million and improves credit quality.
-- As a result of planned coal retirements in the PJM, S&P
forecasts a slight improvement in capacity factors at Big
Sandy and Wolf Hills and therefore slightly improved energy
revenues from our previous forecast. The project has
transparent capacity pricing at Wolf Hills and Big Sandy
through mid-2020, with nearly 100% of each plant's nameplate
capacity cleared in the PJM Base Residual auction.
-- While difficult to forecast with certainty, S&P believes the
peaking facilities in PJM will enjoy some level of
incremental revenue from selling a greater amount of
ancillary services into the PJM.
Credit Weaknesses:
-- The Renewable Portfolio Standard (RPS) in California will
lead to a significant amount of new building in California,
which will be detrimental to the profitability of High
Desert. S&P expects capacity factors at High Desert to
steadily decline between 2016 and 2030 and spark spreads to
increase very little.
-- Lackluster demand in both the PJM and CAISO presents a
challenge for the portfolio; consequently, S&P expects
energy revenues to remain largely flat. The project has
refinance risk because minimum amortization is only 1% of
the term loan. While the presence of a 100% cash flow sweep
is positive for credit, the project depends on the sweep to
pay down principal on the term loan B by a meaningful
amount. S&P projects debt outstanding at refinancing to be
about $197 million including the $20 million revolving
credit facility.
Liquidity is assessed as neutral. Liquidity sources, including cash
flows, availability under the revolving credit facility, debt
service reserves, and major maintenance reserves, exceed uses,
including debt amortization and interest, by well over 2x during
the next 12 months.
The stable outlook reflects S&P's view that MRP Generation Holdings
LLC will continue to meet our expectations both operationally and
financially, with DSCRS above 1.5x on a consistent basis and high
availability at all plants.
S&P could lower the rating if DSCRs were to be sustained below 1.5x
on a consistent basis. This would likely be due to further
depressed power prices, unexpected forced outages, other
operational issues, or lower-than-expected dispatch.
While unlikely at this time, S&P could upgrade MRP Generation
Holdings LLC if DSCRs exceed 2.25x on a sustained basis, likely
stemming from higher-than-expected capacity prices in uncleared
years, higher-than-expected dispatch at each of the plants, and
markedly improved power prices in the PJM and California.
MUSCLEPHARM CORP: Adopts Second Amended Bylaws
----------------------------------------------
The Board of Directors of MusclePharm Corporation adopted the
Second Amended and Restated By-Laws, effective as of Sept. 27,
2016. A description of certain key provisions in the By-Laws is
provided below.
* Stockholder Nomination of Directors: The revised By-Laws clarify
procedures for nominating persons for election to the Board. The
revised By-Laws also clarify information required in notices from
stockholders nominating persons for election to the Board and
proposing other corporate actions. Those notices must include
information regarding the stockholder, its affiliates and
associates and information as to whether the stockholder has
complied with all disclosure requirements with respect to the
Company's securities. (Article 2, Section 2.6)
* Stockholder Voting Standard: The revised By-Laws provide that for
all matters other than a contested election of directors, the
outcome of shareholder votes shall be determined by a majority of
all votes cast on the matter affirmatively or negatively. The
revised By-Laws also provide that a director shall be elected by
the majority of the votes cast with respect to that nominee's
election at any meeting for the election of directors at which a
quorum is present, provided, however, that, in the case of a
director nominee in a Contested Election (as such term is defined
in the revised By-Laws), the Board, in its sole discretion, may
determine that directors shall be elected by a plurality of the
votes cast in any Contested Election. (Article 2, Section 2.8)
* Stockholder Meeting Procedures: The revised By-Laws revise
certain procedural requirements with respect to the conduct of
meetings and provide that the Chairman of the Board or any other
person specifically designated by the Board shall preside over
meetings of stockholders and prescribe applicable procedural rules.
Additionally, the revised By-Laws state that special meetings of
the Company may be called exclusively by (i) the Chairman of the
Board or the Chief Executive Officer, President or other executive
officer of the Company, (ii) the Board of Directors or (iii) the
request in writing of stockholders of record, and only of record,
owning not less than sixty-six and two-thirds percent (66 2/3%) of
the entire capital stock of the Company issued and outstanding and
entitled to vote. (Article 2, Sections 2.1 and 2.3)
* Director Resignation: The revised By-Laws specify that a director
may resign or voluntarily retire upon written notice given to the
Chairman of the Board or the Board, and such resignation or
retirement shall become effective upon giving of the notice, unless
the notice specifies a later effective date. (Article 3, Section
3.3.4)
* Notice of Board Meetings: The revised By-Laws allow special
meetings of the Board to be called on 24 hours' notice to each
director. (Article 3, Section 3.6)
* Board Action: The revised By-Laws state that Board action taken
at a meeting shall be determined by a vote of a majority of the
directors present, provided a quorum is present at that time. The
revised By-Laws also provide that the Board or any of its
committees may take action without a meeting by unanimous consent
in writing or by electronic transmission. (Article 3, Sections 3.7
and 3.8)
* Board Meeting Procedures: The revised By-Laws provide that the
Chairman of the Board (or his or her designee) shall have full
authority to control the process of any stockholder or Board
meeting. (Article 2, Section 2.1)
* Removal of Directors: The revised By-Laws state that the
stockholders of the Company may remove a member of the Board by the
affirmative vote of sixty-six and two-thirds percent (66 2/3%) of
the issued and outstanding stock entitled to vote. (Article 3,
Section 3.3.3)
* Description of Offices of President, Secretary, Treasurer and
Executive Officers: The revised By-Laws include a description of
the office of the President, Chief Executive Officer, Chief
Financial Officer, Secretary and Treasurer. (Article 6, Sections
6.7-6.11)
* Voting Securities: The revised By-Laws state that all stock and
other securities of any other corporation owned or held by the
Company for itself, or for other parties in any capacity, and all
proxies with respect thereto, shall be executed by the person
authorized to do so by resolution of the Board or, in the absence
of such authorization, by any Principal Officer (as such term is
defined in the revised By-Laws). (Article 7, Section 7.4)
* Amendments: The revised By-Laws state that (i) the stockholders
of the Company may alter, amend, repeal or remove the By-Laws or
any portion thereof only by the affirmative vote of sixty six and
two-thirds percent (66 2/3%) of the stockholders entitled to vote
at a meeting of the stockholders duly called, however that no such
change to any By-Law may alter, modify, waive, abrogate or diminish
the Company's obligation to provide indemnity called for by Article
10 of the revised By-Laws, the Articles of Incorporation or any
applicable law, and (ii) notwithstanding the above, the Board may,
by majority vote of those present at any meeting at which a quorum
is present, alter, amend or repeal the By-Laws or any portion
thereof, or enact such other By-Laws as in their judgment may be
advisable for the regulation of the conduct of the affairs of the
Company. (Article 12, Sections 12.1-12.2)
The amendments to the By-Laws also include immaterial language
changes and clarifying or conforming changes.
A full-text copy of the Second Amended and Restated By-Laws of
MusclePharm Corporation is available for free at:
https://is.gd/KbAquz
About MusclePharm
Headquartered in Denver, Colorado, MusclePharm Corporation
(OTC BB: MSLP) -- http://www.muslepharm.com/-- is a healthy life-
style company that develops and manufactures a full line of
National Science Foundation approved nutritional supplements that
are 100 percent free of banned substances. MusclePharm is sold in
over 120 countries and available in over 5,000 U.S. retail outlets,
including GNC and Vitamin Shoppe. MusclePharm products are also
sold in over 100 online stores, including bodybuilding.com,
Amazon.com and Vitacost.com.
MusclePharm Corporation reported a net loss of $13.8 million in
2014, a net loss of $17.7 million in 2013 and a net loss of $19
million in 2012.
As of June 30, 2016, MusclePharm had $50.62 million in total
assets, $65.63 million in total liabilities and a total
stockholders' deficit of $15 million.
NAKED BRAND: Receives Noncompliance Notice from Nasdaq
------------------------------------------------------
Naked Brand Group Inc. received on Sept. 23, 2016, written notice
from the Listing Qualifications Staff of The Nasdaq Stock Market
notifying the Company that it no longer complies with Nasdaq
Listing Rule 5550(b)(1) due to the Company's failure to maintain a
minimum of $2,500,000 in stockholders' equity or any alternatives
to such requirement. The Company reported stockholders' equity of
$1,558,715 in its quarterly report on Form 10-Q for the quarterly
period ended July 31, 2016.
Nasdaq's notice has no immediate effect on the listing of the
Company's common stock on The Nasdaq Capital Market. Under Nasdaq
Listing Rule 5810(c)(2), the Company has 45 days, or until Nov. 7,
2016, to provide Nasdaq with a plan to regain compliance with the
Minimum Stockholders' Equity Requirement. If Nasdaq accepts the
Company's plan, Nasdaq may grant an extension of up to 180 calendar
days from the date of the notice, or until March 22, 2017, to
evidence compliance with the Minimum Stockholders' Equity
Requirement. If Nasdaq does not accept the Company's plan, the
Company will have the right to appeal such decision to a Nasdaq
hearings panel.
The Company is currently evaluating various alternative courses of
action to regain compliance with the Minimum Stockholders' Equity
Requirement and intends provide Nasdaq with a plan before Nov. 7,
2016. There can be no assurance that Nasdaq will accept the
Company's plan or that the Company will be able to regain
compliance with the Minimum Stockholders' Equity Requirement or
maintain compliance therewith or with any other Nasdaq requirement
in the future.
About Naked Brand
Naked Brand Group Inc. designs, manufactures, and sells men's
innerwear and lounge apparel products in the United States and
Canada. It offers various innerwear products, including trunks,
briefs, boxer briefs, undershirts, T-shirts, and lounge pants
under the Naked brand, as well as under the NKD sub-brand for men.
The company sells its products to consumers and retailers through
wholesale relationships and direct-to-consumer channel, which
consists of an online e-commerce store, thenakedshop.com. Naked
Brand Group Inc. is based in New York, New York.
Naked Brand reported a net loss of US$19.06 million on US$1.38
million of net sales for the year ended Jan. 31, 2016, compared to
a net loss of US$21.07 million on US$557,000 of net sales for the
year ended Jan. 31, 2015.
As of July 31, 2016, Naked Brand had US$2.99 million in total
assets, US$1.44 million in total liabilities and US$1.55 million in
total stockholders' equity.
BDO USA, LLP, in New York, NY, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Jan. 31, 2016, noting that the Company incurred a net loss of
$19,063,399 for the year ended January 31, 2016 and the Company
expects to incur further losses in the development of its business.
This condition raises substantial doubt about the Company's
ability to continue as a going concern.
NAVIDEA BIOPHARMACEUTICALS: Appoints President and CEO
------------------------------------------------------
Navidea Biopharmaceuticals, Inc., appointed Michael M. Goldberg,
M.D., age 57, as its president and chief executive officer on Sept.
22, 2016.
Dr. Goldberg will remain a member of the Board of Directors of the
Company, however, he will no longer serve as the chairman of the
Board or as a member of its Audit Committee, which positions will
be filled by Dr. Eric Rowinsky. Dr. Goldberg has served as a
director of the Company since November 2013 and as interim chief
executive officer of the Company from May to October 2014. Dr.
Goldberg is currently a managing partner of Montaur Capital
Partners since January 2007. Prior to this role, he served as the
Chairman of the Board and chief executive officer of Emisphere
Technologies, Inc., the pioneer in the development of oral delivery
technologies for macromolecules, from August 1990 to January 2007.
Prior to Emisphere, Dr. Goldberg was a vice president in Investment
Banking of The First Boston Corporation, where he was a founding
member of the Healthcare Banking Group. Dr. Goldberg is or has been
a director of Echo Therapeutics, Inc., AngioLight, Inc., Urigen
Pharmaceuticals, Inc., Alliqua BioMedical, Inc., and ADVENTRX
Pharmaceuticals Inc. He graduated from the accelerated six year
combined BS/MD program from Rensselaer Polytechnic Institute and
the Albany Medical College in 1982, and obtained an M.B.A. from the
Graduate School of Business, Columbia University, in 1985.
In connection with his appointment, effective as of Sept. 22, 2016,
the Company entered into an employment agreement with Dr. Goldberg.
The Employment Agreement has a one-year term, renewable annually
by the Board. During the Term, Dr. Goldberg will receive an annual
base salary of $400,000, of which (i) $300,000 will be payable in
bi-monthly installments of $12,500, and (ii) $100,000 will be
payable at such time as the Board determines in its sole discretion
that the Company has adequate cash flow, subject to annual review
and increase by the Compensation Committee of the Board. Dr.
Goldberg will also be entitled to an annual bonus of up to 75% of
his annual base salary, based on achievement of annual target
performance goals established by the Compensation Committee. In
the event that the market capitalization of the Company at the end
of the calendar year during the Term is at least $250,000,000, then
the Compensation Committee of the Board may at its sole discretion
increase the annual bonus to an amount equal to up to 100% of his
annual base salary.
Pursuant to the Employment Agreement, Dr. Goldberg has been granted
options to purchase up to 5,000,000 shares of the Company's common
stock, $0.001 par value, at an exercise price of $1.00 per share,
to become vested and exercisable, subject to stockholder approval
of the Company's 2016 Stock Incentive Plan recently adopted by the
Board, in full if the average closing price of the Common Stock
over five consecutive trading days equals or exceeds $2.50 per
share (subject to adjustment); provided, however, if stockholder
approval of the 2016 Plan is not obtained at the first meeting of
stockholders at which a vote takes place, the stock options will be
deemed void ab initio and, for a period of five years, if the
Vesting Conditions are met, Dr. Goldberg shall be entitled to a
bonus upon his written notice to the Company calculated as the per
share closing price of the Common Stock on the date of such notice
minus $1.00 multiplied by 5,000,000. Dr. Goldberg is also entitled
to receive options in an amount equal to up to one percent (1%) of
the ownership interest in the Company's subsidiary, Macrophage
Therapeutics, as further described in the Employment Agreement.
The Employment Agreement is designed to approximate in value the
employment contract of the Company's prior chief executive
officer.
If, during the Term, the Company terminates Dr. Goldberg's
employment Without Cause or if he terminates his employment for
Good Reason (each as defined in the Employment Agreement), Dr.
Goldberg shall be paid as severance (i) his continued base salary,
as in effect at termination, payable through the Severance Period
(as defined in the Employment Agreement), (ii) a bonus equal to
twelve (12) months of his then current annual base salary plus an
additional two months' base salary for every completed year of his
service, and (iii) his unpaid bonus, if any, for the year he was
terminated, prorated to the date of termination.
The Employment Agreement also contains customary non-competition
and non-solicitation covenants that bind Dr. Goldberg during the
Term and for a period of one year thereafter.
About Navidea
Navidea Biopharmaceuticals, Inc. is a biopharmaceutical company
focused on the development and commercialization of precision
immunodiagnostic agents and immunotherapeutics. Navidea is
developing multiple precision-targeted products based on our
Manocept platform to help identify the sites and pathways of
undetected disease and enable better diagnostic accuracy, clinical
decision-making, targeted treatment and, ultimately, patient care.
As of June 30, 2016, Navidea had $8.68 million in total assets,
$72.58 million in total liabilities and a $63.90 million total
stockholders' deficit.
Navidea reported a net loss of $27.56 million in 2015, a net loss
of $35.72 million in 2014 and a net loss of $42.69 million in 2013.
NEPHROGENEX INC: Selling All Assets at Nov. 14 Auction
------------------------------------------------------
NephroGenex, Inc., filed a notice with the U.S. Bankruptcy Court
for the District of Delaware that it is selling substantially all
assets.
A hearing on the Motion is set for Nov. 14, 2016 at 10:00 a.m.
(ET). The objection deadline is Oct. 28, 2016 at 4:00 p.m. (ET).
The Debtor has reserved the right to seek Court approval, with
notice and an opportunity for hearing, of a party to serve as a
stalking horse purchaser ("Stalking Horse Purchaser") to acquire
the Assets pursuant to a Transaction Agreement between the Debtor
and the Stalking Horse Purchaser.
By order dated Sept. 23, 2016, the Court approved certain "Bidding
Procedures" that govern the sale of, or other transaction to
acquire, the Assets by the bidder submitting the highest or
otherwise best bid.
The Debtor has requested that the Court enter a Sale Order which
provides, among other things, for the sale of the Assets free and
clear of all liens, claims, encumbrances and other interests, to
the extent permissible by law, and the assumption of certain
liabilities. A separate notice will be provided to counterparties
to executory contracts and unexpired leases with the Debtor that
may be assumed and assigned in connection with the Sale Order.
The bid deadline is Nov. 10, 2016 at 5:00 p.m. (ET).
The auction for the Assets will commence on Nov. 14, 2016 at 10:00
a.m. (ET) at the Offices of Cole Schotz P.C., 500 Delaware Ave.,
Suite 1410, Wilmington, Delaware.
About NephroGenex, Inc.
Raleigh, N.C.-based NephroGenex, Inc., is a drug development
company that focuses on developing novel therapies for kidney
disease. It develops Pyridorin (pyridoxamine dihydrochoride), a
therapeutic agent, which is in Phase III clinical study for the
treatment of diabetic nephropathy.
NephroGenex filed for Chapter 11 bankruptcy protection (Bankr. D.
Del. Case No. 16-11074) on April 30, 2016, disclosing $4.9 million
in total assets and $6.2 million in total debt as of April 30,
2016. The petition was signed by John P. Hamill, chief executive
officer and chief financial officer.
David R. Hurst, Esq., at Cole Scotz P.C. serves as the Debtor's
bankruptcy counsel. Cassel Salpeter & Co. LLC is the Debtor's
investment banker and financial advisor. Kurtzman Carson
Consultants LLC is the Debtor's claims and noticing agent.
NORANDA ALUMINUM: Court OKs Stalking Horse Deal with MFR II
-----------------------------------------------------------
BankruptcyData.com reported that the U.S. Bankruptcy Court issued
an order approving Noranda Aluminum Holding's motion for an order
approving its entry into a stalking horse agreement and authorizing
bid protections in connection with the sale of its "New Madrid
Assets" located in Missouri and associated with the Debtors'
upstream business. As previously reported, "MFR II is the stalking
horse purchaser for the acquired assets associated with production
of the primary aluminum and conversion of the molten primary
aluminum into value-added products. Cash consideration of thirteen
million Dollars ($13,000,000) (the 'Cash Consideration'), subject
to a purchase price reduction for the price allocated to certain
real property as set forth in the Stalking Horse Agreement. The
parties are seeking approval of a 'breakup fee' of 3% of the Cash
Consideration, plus reimbursement of Buyer's out of pocket
expenses, capped at $130,000, for actual and documented
out-of-pocket fees and expenses, including fees and expenses of
legal advisors, financial advisors and accountants, incurred by
Buyer in connection with the Stalking Horse Agreement and the
transactions contemplated thereby, in the event that Seller
consummates an Alternative Transaction."
About Noranda Aluminum
Noranda Aluminum, Inc., and 10 of its affiliates filed separate
Chapter 11 bankruptcy petitions (Bankr. E.D. Mo. Lead Case No.
16-10083) on Feb. 8, 2016. The petitions were signed by Dale W.
Boyles, the chief financial officer. Judge Barry S. Schermer is
assigned to the cases.
The Debtors have engaged Paul, Weiss, Rifkind, Wharton & Garrison
LLP as counsel, Carmody MacDonald P.C. as local counsel, PJT
Partners, LP as investment banker, Alvarez & Marsal North America,
LLC as restructuring advisors and Prime Clerk LLC as claims,
solicitation and balloting agent.
The Debtors estimated both assets and liabilities in the range of
$1 billion to $10 billion. As of the Petition Date, the Debtors
had approximately $529.6 million in outstanding principal amount of
secured indebtedness, consisting of a revolving credit facility and
a term loan facility.
The Debtors had approximately 1,857 employees as of the Petition
Date.
OAK CREEK: Exit Plan Sets Aside $100K to Pay Unsecured Creditors
----------------------------------------------------------------
Oak Creek Plaza, L.L.C., on Sept. 20 filed with the U.S. Bankruptcy
Court for the Northern District of Illinois its proposed plan to
exit Chapter 11 protection.
The restructuring plan proposes to pay $100,452 to creditors
holding Class 2 general unsecured claims.
General unsecured creditors will receive payments within 180 days
of the effective date of the plan, according to the disclosure
statement explaining the plan.
A copy of the disclosure statement is available for free at
https://is.gd/SNETCK
About Oak Creek Plaza
Oak Creek Plaza, L.L.C. filed a chapter 11 petition (Bankr. N.D.
Ill. Case No. 16-16324) on May 13, 2016. The petition was signed
by Ronald L. Boorstein, managing partner. The Debtor is
represented by Paul M. Bach, Esq., at Bach Law Offices. The case
is assigned to Judge Jacqueline P. Cox. The Debtor estimated
assets and liabilities at $1 million to $10 million at the time of
the filing.
OAKFABCO INC: Court Sets Oct. 31 Exclusive Plan Filing Deadline
---------------------------------------------------------------
Judge Jack B. Schmetterer extended Oakfabco, Inc.'s exclusive
period and deadline to file a chapter 11 plan and disclosure
statement, and exclusive period to solicit acceptances to the plan,
to October 31, 2016 and December 31, 2016, respectively.
A status conference for a report on the status of the plan and
disclosure statement is scheduled for November 7, 2016 at 11:00
a.m.
The Debtor previously sought the extension of its exclusive period
to file a chapter 11 plan and disclosure statement through December
31, 2016 and February 28, 2017, respectively.
The Debtor related that since the late 1980s, thousands of
claimants have sought money damages against the Debtor for personal
injury and wrongful death alleged as a result of exposure to
asbestos-containing products allegedly manufactured or sold by the
Debtor or a predecessor in interest. The Debtor estimated that
there are approximately 3,400 active Asbestos Claims and over
30,000 inactive Asbestos Claims outstanding against the Debtor, as
of the Petition Date.
The Debtor contended that it is the policyholder under various
insurance policies that provide coverage for Asbestos Claims.
The Debtor further contended that after years of covering the
Debtor's defense and indemnity costs relating to the Asbestos
Claims, First State Insurance Company, et al., Affiliated FM
Insurance Company, and American Casualty Company, et al., also
known as the Settling Insurers, advised the Debtor prior to the
Petition Date that coverage for defense costs is or soon would be
exhausted.
The Debtor contended that it conducted negotiations with the
Settling Insurers prior to the filing of the Chapter 11 Case, which
resulted in three Insurance Settlement Agreements, that monetize
the policies issued by the Settling Insurers in the aggregate
amount of $17,333,079. The Debtor further contended that it filed
three Insurance Settlement Motions, seeking orders authorizing and
approving the Insurance Settlement Agreements.
The Debtor told the Court that in light of the adjournment of the
hearing dates for the two remaining Insurance Settlement Motions to
October 20, 2016, the current Exclusivity Periods do not allow the
Debtor sufficient time to obtain approval of those Insurance
Settlement Agreements and then formulate, negotiate, and file its
plan of liquidation.
About Oakfabco, Inc.
Oakfabco, Inc, formerly known as Kewanee Boiler Corporation, has
not manufactured boilers since 1988 when it sold its Kewanee boiler
business in an 11 U.S.C. Section 363 sale to Coppus Engineering
Corporation. In early 2009, it sold all of its remaining assets.
The Debtor has no employees, and, Frederick W. Stein is the
Debtor's sole officer and director. The Debtor's sole remaining
asset is its insurance, and it has no known liabilities other than
asbestos claims.
In January 1970, Kewanee Boiler Corp, then a newly-formed Illinois
Corporation, acquired the assets and debt of American Standard,
Inc.'s commercial boiler manufacturing division known as "Kewanee
Boiler." The boilers manufactured and sold by Kewanee Boiler were
insulated with asbestos.
Oakfabco sought Chapter 11 protection (Bankr. N.D. Ill. Case No.
16-27062) on Aug. 7, 2015, to resolve its remaining asbestos
claims. The petition was signed by Frederick W. Stein, president.
Stephen T. Bobo, Esq., Aaron B. Chapin, Esq., Paul M. Singer, Esq.,
Luke A. Sizemore, Esq., and Joseph D. Filloy, Esq., at Reed Smith
LLP, serves as counsel to the Debtor.
The Debtor estimated $10 million to $50 million in assets and
debt.
The U.S. Trustee for Region 11, appointed four members to the
Asbestos Claimants' Committee in the Chapter 11 bankruptcy case of
Oakfabco Inc.
OCH-ZIFF CAPITAL: To Pay Over $400-Mil. in Bribery Settlement
-------------------------------------------------------------
Alexanda Stevenson, writing for The New York Times' DealBook,
reported that more than a decade later, the hedge fund, Och-Ziff
Capital Management, and its founder, Daniel Och, are paying the
price for what the United States government has charged were more
than $100 million in bribes paid to government officials in Libya,
Chad, Niger, Guinea and the Democratic Republic of Congo to secure
natural resources deals and other investments.
According to the report, OZ Africa Management, a unit of Och-Ziff,
pleaded guilty in Federal District Court in Brooklyn to one count
of conspiracy -- an unusual violation for a hedge fund of a federal
law aimed at preventing bribery of foreign officials.
Mr. Och, who is also chief executive of Och-Ziff, agreed to pay
$2.2 million to settle a record-keeping violation with the
Securities and Exchange Commission, the report related. Joel M.
Frank, Och-Ziff’s chief financial officer, also agreed to settle
charges that executives ignored red flags, the report further
related.
And Och-Ziff itself will pay a $413 million fine as part of a
deferred-prosecution agreement to settle both the criminal and
civil charges, the report said.
The report noted that the settlement is one of the biggest criminal
penalties levied on a United States hedge fund firm, dealing a blow
to Och-Ziff as it works to stem withdrawals from its investors,
which include state pension funds, endowments and foundations.
Och-Ziff is a publicly owned investment management company that
was founded in 1994 and is based New York, New York with
additional offices in London, United Kingdom; Hong Kong; Tokyo,
Japan; Bangalore, India; and Beijing, China.
ORACLE PROJECT: Disclosures OK'd; Plan Hearing on Nov. 1
--------------------------------------------------------
The Hon. Scott H. Gan of the U.S. Bankruptcy Court for the District
of Arizona has approved Oracle Project I, LLC's first amended
disclosure statement describing the Debtor's first amended plan of
reorganization.
The plan confirmation hearing will be held on Nov. 1, 2016, at 1:30
p.m.
The last day for filing objections to confirmation of the First
Amended Plan is fixed at five business days prior to the hearing
date set for conformation of the First Amended Plan.
The written report by the plan proponent must be filed three
business days prior to the hearing date set for the confirmation of
the First Amended Plan.
As reported by the Troubled Company Reporter on Sept. 9, 2016, the
Debtors filed with a First Joint Disclosure Statement which states
that under the Plan, Class 1-F, which consists of allowed Unsecured
Claims against LPI, and Class 2-Q, which consists of allowed
unsecured claims against Ms. Anda, will be paid a pro-rata share
from the Debtors' excess cash flow, on a quarterly basis, in an
amount sufficient to fund the value of the Debtors' liquidation
equity, after all senior allowed claims have been paid in
accordance with the terms of the Plan.
About Oracle Project I
Oracle Project I, LLC's most significant asset is what is commonly
known as the historic "3C Ranch" in Oracle, Arizona. The property
is specifically located at 36033 South Mount Lemmon Road, Oracle,
Arizona 85623. Additionally, Oracle owns four small vacant
parcels. Oracle's members are Darimont Ranch, LLC (75%) and
Turnkey Opportunity, LLC (25%).
Oracle Project I, LLC, filed a Chapter 11 petition (Bankr. D. Ariz.
Case No. 15-08330) on July 2, 2015, and is represented by Jeffrey
M. Neff, Esq., and Amanda C. Fife, Esq., at Neff & Boyer, P.C., in
Tucson, Arizona.
PACIFIC ANDES: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Pacific Andes Resources Development Limited
Room 3201-3210
Hong Kong Plaza
188 Connaught Road West
Hong Kong
Case No.: 16-12739
Type of Business: Commercial Fishing
Chapter 11 Petition Date: September 29, 2016
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Hon. James L. Garrity Jr.
Debtor's Counsel: Tracy L. Klestadt, Esq.
KLESTADT WINTERS JURELLER
SOUTHARD & STEVENS, LLP
200 West 41st Street, 17th Floor
New York, NY 10036-7203
Tel: (212) 972-3000
Fax: (212) 972-2245
E-mail: tklestadt@klestadt.com
Estimated Assets: $1 billion to $10 billion
Estimated Debts: $100 million to $500 million
The petition was signed by Ng Puay Yee, Annie (Jessie), executive
chairman.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
Pacific Andes is related to China Fishery Group Limited (Cayman)
which filed for bankruptcy on June 30, 2016 (Bankr. S.D.N.Y. Case
No. 16-11895).
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/nysb16-12739.pdf
PAE HOLDING: Moody's Assigns B3 Corporate Family Rating
-------------------------------------------------------
Moody's Investors Service has assigned ratings to PAE Holding
Corporation ("PAE"), including a B3 Corporate Family Rating. The
rating outlook is stable.
RATINGS RATIONALE
The B3 CFR reflects financial leverage that will be elevated
following the pending recapitalization, whereby the company will
refinance its existing debt and pay a $370 million dividend.
Estimation of income-based leverage is complicated by the high
level of transactional and non-recurring operational expenses
during the last twelve month period. Pro forma for the pending debt
increase and excluding most of the recent transactional costs,
Moody's estimates debt to EBITDA in the mid-6x range with funds
from operation to debt of slightly below 10%. On a Moody's adjusted
basis, which includes both multi-employer and qualified defined
benefit pension adjustments, next twelve month free cash flow to
debt should be in the mid-single digit percentage range. The rating
incorporates the low profit margin that PAE reports versus other
contractors as the role that PAE fulfills often involves less
specialized services (but a wide range of them). Further, the
revenue base contains a high degree of materials procured on behalf
of customers, rather than revenues derived purely through direct
labor. Acquisitions of higher value added services businesses in
recent years have however raised the operating margin potential and
expanded bid opportunities. The company will likely remain focused
on making acquisitions.
The B3 CFR also factors in PAE's well-regarded heritage as a
provider of base operations, logistics and other mission support
services globally to the US Department of State, the US Department
of Defense, foreign governments and international organizations.
The enduring nature of missions that PAE supports results in a
portfolio of relatively longer-term service contracts which boosts
the company's backlog level and yields good revenue visibility.
The rating outlook is stable as PAE's robust bid pipeline should
support backlog. The outlook for US defense spending is stable with
services outlay growth anticipated beginning in 2017. The outlook
also benefits from the adequate liquidity profile expected to
follow the recapitalization.
Upward rating momentum would depend on low (at least) revenue
growth, a rising backlog trend and debt to EBITDA approaching the
low 5x range with free cash flow to debt nearing 10%.
Downward rating pressure would follow unfavorable contract
developments, low free cash flow or high dependence on the
revolving credit facility. A highly leveraging acquisition could
pressure the rating, particularly if PAE's free cash flow
generation appears to be muted (e.g. less than $30 million p.a.).
Assignments:
Issuer: PAE Holding Corporation
-- Probability of Default Rating, Assigned B3-PD
-- Corporate Family Rating, Assigned B3
-- Senior Secured 1st lien Bank Credit Facility, Assigned B2
(LGD3)
-- Senior Secured 2nd lien Bank Credit Facility, Assigned Caa2
(LGD5)
Outlook Actions:
Issuer: PAE Holding Corporation
-- Outlook, Assigned Stable
PAE Holding Corporation, headquartered in Arlington, VA, is a
holding company that is owned by entities of Platinum Equity, LLC.
Through its subsidiary, Pacific Architects and Engineers
Incorporated, PAE provides contract support services to US
government agencies, international organizations, and foreign
governments. Revenues for the last twelve months ended June 30,
2016 were $2.1 billion.
The principal methodology used in these ratings was Global
Aerospace and Defense Industry published in April 2014.
PAE HOLDING: S&P Assigns 'B' CCR & Rates $550MM Term Loan 'B'
-------------------------------------------------------------
S&P Global Ratings said that it has assigned its 'B' corporate
credit rating to PAE Holding Corp. The outlook is stable.
At the same time, S&P assigned its 'B' issue-level rating and '3'
recovery rating to the company's $550 million first-lien term loan
B due 2022. The '3' recovery rating indicates S&P's expectation
for meaningful recovery (50%-70%; upper half of the range) in a
default scenario.
In addition, S&P assigned its 'CCC+' issue-level rating and '6'
recovery rating to PAE's proposed $175 million second-lien term
loan due 2023. The '6' recovery rating indicates S&P's
expectations for negligible (0%-10%) recovery.
"Our rating on PAE reflects the company's high debt leverage
following the proposed refinancing, its ownership by a
private-equity sponsor, its modest scale, and its exposure to the
competitive government services market, which constrains its
margins," said S&P Global credit analyst Isha Bagga. "Our rating
also incorporates the company's relatively good program diversity
for its size, the long-term nature of most of its contracts, and
the improving outlook for government spending." S&P expects PAE's
debt-to-EBITDA to be in the 5.5x-6.5x range and its funds from
operations (FFO)-to-debt ratio to be below 10% in 2016, pro forma
for the transaction, with some improvement over the following 12
months as its earnings improve and it uses its excess cash flows to
reduce its debt. However, S&P do not expect the company's
debt-to-EBITDA metric to fall below 5x for an extended period
because S&P believes that it will likely pursue debt-financed
acquisitions or dividends.
The stable outlook on PAE reflects S&P's expectation that the
company's leverage will remain high following the proposed
transaction. Although S&P expects the company's credit ratios to
improve modestly over the next 12 months as its earnings increase
and it pays down some of its debt, S&P do not expect its
debt-to-EBITDA metric to fall below 5x because its private-equity
sponsor will probably undertake further dividends or debt-financed
acquisitions.
S&P could lower its ratings on PAE if a debt-financed acquisition,
dividend payment, or greater-than-expected level of operating
challenges causes its debt-to-EBITDA metric to increase to more
than 7x or material deteriorates its liquidity position.
The company's ownership by a private-equity firm and the potential
for a debt-financed dividend or other transaction that could
significantly increase its leverage makes it unlikely that S&P will
upgrade the company under its current structure.
PAMELA FROG: Case Summary & 11 Unsecured Creditors
--------------------------------------------------
Debtor: Pamela FROG, LLC
dba Pam's Academy of Champions
1205 Pierce Road
Lansing, MI 48910
Case No.: 16-04965
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Western District of Michigan (Grand Rapids)
Judge: Hon. John T. Gregg
Debtor's Counsel: Michael Shawn Mahoney, Esq.
MICHAEL S. MAHONEY, P.C.
912 Centennial Way, Suite 320
Lansing, MI 48917
Tel: 517-323-4410
Fax: 517-323-4503
E-mail: Michael@MahoneyLawoffices.com
Total Assets: $332,704
Total Liabilities: $1.13 million
The petition was signed by Pamela J. Eaton-Champion, managing
member.
A copy of the Debtor's list of 11 unsecured creditors is available
for free at http://bankrupt.com/misc/miwb16-04965.pdf
PARKER DEVELOPMENT: Case Summary & Unsecured Creditor
-----------------------------------------------------
Debtor: Parker Development, LLC
aka Parker Development I, LLC
852 Tidewater Drive
Norfolk, VA 23504
Case No.: 16-73359
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Eastern District of Virginia (Norfolk)
Judge: Hon. Stephen C. St. John
Debtor's Counsel: Greer W. McCreedy, II, Esq.
THE MCCREEDY LAW GROUP, PLLC
413 West York St
Norfolk, VA 23510
Tel: (757)233-0045
Fax: 757-233-7661
E-mail: McCreedy@McCreedylaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by George G. Parker, president.
The Debtor listed the treasurer of the City of Norfolk as its
largest unsecured creditor holding a claim of $33,000.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/vaeb16-73359.pdf
PERSEON CORP: Asks for Plan Exclusivity Extension Through Nov. 21
-----------------------------------------------------------------
BSD Medical Corporation fka Perseon Corporation requests the U.S.
Bankruptcy Court for the District of Utah for a 60-day extension of
the exclusive periods to file a chapter 11 plan and solicit
acceptances to such plan, through and including, Nov. 21, 2016, and
Jan. 18, 2017, respectively.
The Debtor relates that it has focused its efforts on continuing
its business operations, obtaining certification to continue to
sell its products in the European market, and consummating the sale
of the bulk of its assets with MedLink Technologies, LLC, a wholly
owned subsidiary of Scion Medical Technologies, LLC.
In addition, under the asset purchase agreement, the Debtor sold
the name "Perseon Corporation" to Scion, and consequently, the
Debtor has taken action with the Delaware Division of Corporations
to change its name to BSD Medical Corporation.
Having the sale transaction closed only on Aug. 22, 2016, the
Debtor has focused its efforts on developing the Plan and now it
will seek confirmation of the Plan to expeditiously distribute
funds -- the Debtor received $4.35 million purchase price, minus
the $850,000 bid deposit, from Scion -- to the its stakeholders.
The Debtor believes that, at this time, the filing of plans by
third parties, or even the mere threat of such a filing, would
serve no purpose other than to introduce delay and additional
administrative expenses to this case.
About Perseon Corp.
Perseon Corp., formerly known as BSD Medical Corp., sought Chapter
11 protection (Bankr. D. Utah Case No. 16-24435) on May 23, 2016,
in Salt Lake City. Perseon is publicly traded medical technology
developer and manufacturer that is primarily focused on creating
and manufacturing ablation technologies for treating cancer.
The Debtors listed $1 million to $10 million in assets and debt.
The Debtors are represented by Steven T. Waterman, Esq., at Dorsey
& Whitney LLP. Nixon Peabody LP serves as patents counsel. The
petition was signed by Clinton E. Carnell Jr., CEO/President.
Chief Judge R. Kimball Mosier is assigned to the case.
No trustee, examiner, or official committee of unsecured creditors
has been appointed in this case.
PETROQUEST ENERGY: Closes Exchange Offers & Consent Solicitation
----------------------------------------------------------------
PetroQuest Energy, Inc., disclosed that it has closed its private
exchange offers to eligible holders of its outstanding 10% Senior
Notes due 2017 (CUSIP No. 716748 AA6) and its outstanding 10%
Second Lien Senior Secured Notes due 2021 (CUSIP 716748 AE8 /
U7167U AB0) for certain consideration, and related consent
solicitation to adopt certain amendments to the indenture governing
the 2021 Notes and the registration rights agreement with respect
to the 2021 Notes.
At the closing, and in satisfaction of the consideration of
$243,468,000 in aggregate principal amount of the Old Notes,
representing approximately 86.9% of the outstanding aggregate
principal amount of Old Notes, validly tendered (and not validly
withdrawn) in the Exchange Offers, PetroQuest issued (i)
$243,468,000 in aggregate principal amount of its newly issued 10%
Second Lien Senior Secured PIK Notes due 2021 and (ii) 3,517,000
shares of its common stock. PetroQuest also paid, in cash, accrued
and unpaid interest on Old Notes accepted in the Exchange Offer
from the last applicable interest payment date to, but not
including, Sept. 27, 2016. Interest on the New Notes will accrue
from Sept. 27, 2016.
Following the consummation of the Exchange Offers, there are
$22,650,000 in aggregate principal amount of the 2017 Notes
outstanding and $14,177,000 million in aggregate principal amount
of the 2021 Notes outstanding.
On Sept. 23, 2016, the Company made the interest payment previously
due on Sept. 1, 2016, with respect to the 2017 Notes, which payment
was made prior to the expiration of the 30 day grace period for
payment of interest under the indenture governing the 2017 Notes.
About PetroQuest
PetroQuest Energy, Inc. is an independent energy company engaged in
the exploration, development, acquisition and production of oil and
natural gas reserves in East Texas, Oklahoma, South Louisiana and
the shallow waters of the Gulf of Mexico. PetroQuest's common
stock trades on the New York Stock Exchange under the ticker PQ.
As of June 30, 2016, Petroquest had $209 million in total assets,
$433 million in total liabilities, and a total stockholders'
deficit of $225 million.
In its quarterly report for the period ending June 30, 2016, the
Company stated, "Our substantially decreased level of capital
spending has had and is expected to continue to have a negative
impact on our production and cash flow from operating activities.
We expect production to continue to decline throughout 2016 and
when combined with current commodity prices and our existing cost
structure, including 10% interest expense on the $280 million of
debt represented by our 2017 Notes and 2021 Notes, we believe that
we will continue to incur significant losses and negative cash flow
from operating activities for the remainder of 2016. In addition,
$136 million of the indebtedness represented by our 2017 Notes will
mature on September 1, 2017 and would be reflected as a current
liability on our September 30, 2016 balance sheet if not refinanced
prior to the filing of our Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2016, which would raise
substantial doubt about our ability to continue as a going
concern," the Company stated in its quarterly report for the period
ended June 30, 2016.
"We are evaluating additional sources of liquidity including asset
sales, joint ventures, exchange offers and alternative financing
arrangements to replace the Credit Agreement, but there is no
assurance that these sources will provide sufficient, if any,
incremental liquidity. We are also evaluating various options to
address the September 2017 maturity of our 2017 Notes as well as
assessing our overall capital structure. These options include
additional public or private exchanges of 2017 Notes for new
secured debt and/or common stock, refinancing the 2017 Notes with
unsecured debt and/or common stock as well as a broader
restructuring of our 2017 and 2021 Notes. To assist the Board of
Directors and management team in evaluating these options, we have
retained Jefferies LLC and Seaport Global as our financial advisors
and Porter Hedges LLP as our legal advisor. There is no assurance
that any refinancing or debt or equity restructuring will be
possible or that additional equity or debt financing can be
obtained on acceptable terms, if at all. If we are unable to
improve our liquidity position, and refinance or restructure our
debt, we may seek bankruptcy protection to continue our efforts to
restructure our business and capital structure. As a part of that
process, we may have to liquidate our assets and may receive less
than the value at which those assets are carried on our
consolidated financial statements."
PJ ROSALY: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: PJ Rosaly Enterprises, Inc.
dba Islandwide Express
Rexco Industrial Park #150
Calle C, Esq. Calle B, Carr. 165
Guaynabo, PR 00968
Case No.: 16-07690
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Carmen D Conde Torres, Esq.
C. CONDE & ASSOCIATES
254 San Jose Street
5th Floor
San Juan, PR 00901-1523
Tel: 787-729-2900
Fax: 787-729-2203
E-mail: condecarmen@condelaw.com
- and -
Luisa S Valle Castro, Esq.
C. CONDE & ASSOCIATES
254 Calle San Jose 5th Floor
San Juan, PR 00901-1523
Tel: 787 729-2900
E-mail: notices@condelaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ivan Marin, president.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/prb16-07690.pdf
PLANDAI BIOTECHNOLOGY: EMA Reports 9.9% Stake as of Sept. 19
------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, EMA Financial, LLC disclosed that as of Sept. 19, 2016,
it beneficially owns 20,495,663 shares of common stock of
Plandai Biotechnology, Inc., representing 9.9 percent of the shares
outstanding. A full-text copy of the regulatory filing is
available for free at https://is.gd/s8cA7B
About Plandai
Based in Goodyear, Arizona, Plandai Biotechnology, Inc., through
its recent acquisition of Global Energy Solutions, Ltd., and its
subsidiaries, focuses on the farming of whole fruits, vegetables
and live plant material and the production of proprietary
functional foods and botanical extracts for the health and
wellness industry. Its principle holdings consist of land, farms
and infrastructure in South Africa.
Plandai reported a net loss of $10.07 million on $92,898 of
revenues for the year ended June 30, 2015, compared to a net loss
of $16.04 million on $265,735 of revenues for the year ended June
30, 2014.
As of March 31, 2016, Plandai had $6.62 million in total assets,
$17.1 million in total liabilities, and a stockholders' deficit of
$10.4 million.
Pritchett, Siler & Hardy P.C., in Farmington, Utah, issued a "going
concern" qualification on the consolidated financial statements for
the year ended June 30, 2015, citing that the Company Company
suffered a loss from operations during the years ended June 30,
2015 and 2014, has yet to establish a reliable, consistent and
proven source of revenue to meet its operating costs on an ongoing
basis and currently does not have sufficient available funding to
fully implement its business plan. These factors raise substantial
doubt about its ability to continue as a going concern.
PORTER BANCORP: Signs New Employment Agreements with Executives
---------------------------------------------------------------
Porter Bancorp and its banking subsidiary PBI Bank entered into new
employment agreements with the Company's four executive officers,
listed below.
John T. Taylor President and Chief Executive
Officer of the Company and PBI Bank
John R. Davis Chief Credit Officer of PBI Bank
Joseph C. Seiler Executive Vice President -- Head of Commercial
Banking -- Senior Lending Officer of PBI Bank
Phillip W. Barnhouse Chief Financial Officer of the Company and
Chief Financial Officer and Chief Operating
Officer of PBI Bank
The agreements are effective as of Sept. 21, 2016. The terms of
each of the 2016 employment agreements are substantially similar to
the terms of each executive's prior employment agreement, except
that the 2016 agreements do not include grants of restricted stock.
Term. Each of the employment agreements has an initial three-year
term. Prior to the second annual anniversary of the effective
date, and prior to each annual anniversary thereafter, the Board of
Directors of each of the Company and PBI Bank may approve a
one-year extension of the term of the agreement following a review
of the executive's performance, subject to the receipt of any
required bank regulatory consents. The Board of Directors must
give the executive written notice of any decision not to extend the
term not less than 30 days before the next applicable anniversary
of the effective date, in which case the agreement will terminate
at the conclusion of its remaining term.
Base salary. The initial annual base salaries of the Company's
executive officers are shown below:
John T. Taylor $400,000
John R. Davis $250,000
Joseph C. Seiler $240,000
Phillip W. Barnhouse $240,000
Mr. Taylor's employment agreement provides that his base salary
will increase to $425,000 effective July 1, 2017, and to $450,000
effective July 1, 2018. The Board of Directors may increase an
executive's base salary from time to time, but may only decrease it
with his express written consent.
Bonus. Mr. Taylor's employment agreement provides that for any
calendar year he may earn a bonus of up to 50% of his base salary
depending upon the achievement of target performance levels for the
applicable year. Mr. Taylor must submit proposed performance goals
for a calendar year to the Compensation Committee by February 1st,
and the Compensation Committee must approve the performance goals,
with reasonable modifications, by March 1st.
Benefits. The executive is entitled to participate in any
retirement, profit sharing, stock incentive, or other plans,
benefits and privileges given to employees and executives of PBI
Bank, to the extent commensurate with the executive's duties and
responsibilities at the time, as fixed by the board of directors.
Termination of employment. The employment agreements provide that
if the executive's employment is terminated for one of the
following reasons, he will have no right to compensation or other
benefits for any period after the date of termination:
* termination for "Cause";
* as a result of disability, retirement or death; or
* by the executive other than for "Good Reason."
The executive will be entitled to a cash severance payment if the
executive's employment is terminated for one of the following
reasons:
* by the Company other than for Cause, disability, retirement
or death;
* by the executive for Good Reason; or
* by the Company for other than Cause, disability, retirement
or death within six months following the expiration of the
term of the agreement;
For Messrs. Davis, Seiler and Barnhouse, the cash severance payment
would equal one times the executive's then current annual base
salary. For Mr. Taylor, the amount of the cash severance would be
one times his then current annual base salary if the termination is
not concurrent with or within 24 months after a Change in Control,
or if the Company or PBI Bank were deemed to be in "troubled
condition" under federal banking laws at the time of termination.
If the termination were concurrent with or within 24 months after a
Change in Control and neither the Company nor PBI Bank is deemed to
be in "troubled condition" at the time, then the severance payment
would effectively equal the maximum amount that would not
constitute a "parachute payment" under the Internal Revenue Code.
The employment agreements define "Change in Control" as a change in
the ownership of the Company or PBI Bank, a change in the effective
control of the Company or PBI Bank or a change in the ownership of
a substantial portion of the assets of the Company or PBI Bank, in
each case as provided under Section 409A of the Code and the
regulations thereunder.
The obligation of the Company and PBI Bank to pay the severance
amount is subject to several conditions, including the executive's
execution of a general release of claims and a determination that
the executive has not committed any fraudulent act or omission or
any breach of fiduciary duty, is not substantially responsible for
the insolvency or troubled condition of the Company or PBI Bank,
and has not materially violated any applicable federal or state
banking law or regulation, or violated certain other provisions of
federal law.
The employment agreements define "Cause' as termination because of
personal dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit, intentional failure to
perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses) or
final consent or cease-and-desist order or material breach of any
provision of the agreement.
"Good Reason" is defined as any material change in the Metro
Louisville, Kentucky location at which the executive must perform
his services or any material breach of the employment agreement by
the Company and the Bank, including:
* a material diminution in the executive's base compensation,
* a material diminution in his authority, duties or
responsibilities, or
* any change in the executive's reporting duties.
Prior to any termination for Good Reason, the executive must
provide written notice within 90 days of the initial existence of
the condition, and the Company and the Bank will have the right to
remedy the condition within 30 days of receipt.
The Company's present status as an institution in "troubled
condition" requires that the compensation the Company proposes to
pay any executive officer must comply with federal banking
regulations and be approved in advance by bank regulatory agencies.
In accordance with those regulations, the employment agreements
limit severance payments upon termination of employment to one
year's salary and include a "claw-back" provision that entitles the
Bank to recover any severance paid if it is subsequently determined
that violations of law or certain other enumerated adverse events
occurred.
Restrictive covenants. The employment agreements include covenants
not to compete with the Company and the Bank and not to solicit
their employees and customers for a period of 12 months after
termination of employment unless the executive's employment is
terminated in connection with or following a Change in Control of
the Company or the Bank (as defined under Section 409A of the
Internal Revenue Code and the regulations thereunder). The
agreements also include covenants to maintain the confidentiality
of the confidential information of the Company and the Bank other
than in the course of performing services for them.
About Porter Bancorp
Porter Bancorp, Inc., is a bank holding company headquartered in
Louisville, Kentucky. Through its wholly-owned subsidiary PBI
Bank, the Company operates 18 full-service banking offices in
12 counties in Kentucky.
Porter Bancorp reported a net loss of $3.21 million on $36.57
million of interest income for the year ended Dec. 31, 2015,
compared to a net loss of $11.15 million on $39.51 million of
interest income for the year ended Dec. 31, 2014.
As of June 30, 2016, Porter Bancorp had $916.55 million in total
assets, $875 million in total liabilities and $41.4 million in
total stockholders' equity.
The Company's auditor Crowe Horwath, LLP, in Louisville, Kentucky,
issued a "going concern" qualification on the consolidated
financial statements for the year ended Dec. 31, 2015, citing that
"the Company has incurred substantial losses in 2015, 2014 and
2013, largely as a result of asset impairments resulting from the
re-evaluation of fair value and ongoing operating expenses related
to the high volume of other real estate owned and non-performing
loans. In addition, the Company's bank subsidiary is not in
compliance with a regulatory enforcement order issued by its
primary federal regulator requiring, among other things, increased
minimum regulatory capital ratios as well as being involved in
various legal proceedings in which the Company disputes material
factual allegations against the Company. Additional losses,
adverse outcomes from legal proceedings or the continued inability
to comply with the regulatory enforcement order may result in
additional adverse regulatory action. These events raise
substantial doubt about the Company's ability to continue as a
going concern."
PREMIUM CAPITAL: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Premium Capital, LLC
5716 Corsa Av., Ste 110
Westlake, CA 91362
Case No.: 16-11795
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
Central District of California (Santa Barbara)
Judge: Hon. Peter Carroll
Debtor's Counsel: Al West, Esq.
WEST & ASSOCIATES
700 N Pacific Coast Hwy Suite 201
Redondo Beach, CA 90277
Tel: 310 374-4141
E-mail: WestandAssociates@gmail.com
Total Assets: $3.3 million
Total Debts: $13.39 million
The petition was signed by Steve Rogers, authorized agent.
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Ray Gutirerrez Contract for $900,000
428 Georgetown Avenue debt via note
Ventura, CA 93003 & assignment
Email: authorizedtrust.gmail.com
Marc & Michelle Griffith Contract for $600,000
6020 Healtherton Drive debt via Note
Somis, CA 93066 & Assignment
Email: notedresults@gmail.com
Sunil Wadhwa Contract for $600,000
747 Sturbridge Drive debt via Note
Folsom, CA 95630 & Assignment
Raj Wadhwa Contract for $575,000
1102 Penniman Dr. debt via Note
El Dorado Hills, CA 95762 & Assignment
Jane Bin Yu Contract for $575,000
1462 Michigan Avenue debt via Note
San Jose, CA 65002 & Assignment
Angela Leung Contract for $575,000
3217 Acalanes Avenue debt via Note
Lafayette, CA 94549 & Assignment
Greg Somerville Contract for $575,000
3416 Saint Andrews Drive debt via Note
Stockton, CA 95219 & Assignment
Stella Tan Contract for $570,000
4525 Lincoln Way debt via Note
San Francisco, CA 94122 & Assignment
Ellen Davenport Contract for $570,000
5555 Thayer Lane debt via Note
San Ramon, CA 94582 & Assignment
Harold Fuhrmann Contract for $500,000
1953 Village Court debt via Note
lone, CA 95640 & Assignment
Lorraine Moller Contract for $500,000
2525 Arapahoe, Suite 500 debt via Note
Boulder, Colorado 80302 & Assignment
Robert Burns Contract for $400,000
690 Heather Court debt via Note
Pacifica, CA 94044 & Assignment
John Lazell Contract for $175,000
debt via Note
& Assignment
Floro Anunciacion Contract for $175,000
debt via Note
& Assignment
Richard Guriel Contract for $170,000
debt via Note
& Assignment
Maritza Luz Vega Contract for $150,000
debt via Note
& Assignment
Leslie Edwards Contract for $150,000
debt via Note
& Assignment
Gerald Bardel Contract for $150,000
debt via Note
& Assignment
Steven Vaughn Contract for $150,000
debt via Note
& Assignment
John Tombarelli Contract for $150,000
debt via Note
& Assignment
PRIME GLOBAL: Stockholders Elect Five Directors
-----------------------------------------------
An annual meeting of stockholders of Prime Global Capital Group
Incorporated was held on Sept. 22, 2016, at which the
stockholders:
(a) elected Weng Kung Wong, Liong Tat Teh, Maylee Gan Suat Lee,
James E. Scheifley and Ham Poh Chai as directors for terms
expiring at the Company's 2017 Annual Meeting of the
Stockholders; and
(b) ratified the appointment of Crowe Horwath (HK) CPA Limited
as the Company's independent auditors for the fiscal year
ending Oct. 31, 2016.
About Prime Global
Kuala Lumpur, Malaysia-based Prime Global Capital Group operated in
the following three business segments during fiscal year 2014: (i)
software business (the provision of IT consulting, programming and
website development services); (ii) plantation business (including
oilseeds and castor seeds business); and (iii) its real estate
business. In the fourth quarter of fiscal 2014, the Company
discontinued its castor seeds business in China, and in December
2014 it discontinued the software business (the provision of IT
consulting, programming and website services) in Malaysia. As a
result, the Company no longer conduct business operations in China
and anticipate winding down or otherwise selling its interests in
the following entities: Power Green Investments Limited; Max Trend
International Limited and Shenzhen Max Trend Green Energy Co Ltd.
Prime Global reported a net loss US$1.59 million for the year ended
Oct. 31, 2015, compared to a net loss of US$1.33 million for the
year ended Oct. 31, 2014.
As of July 31, 2016, the Company had US$48.2 million in total
assets, U$18.3 million in total liabilities and US$29.8 million in
total equity.
Crowe Horwath (HK) CPA Limited, in Hong Kong, China, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Oct. 31, 2015, citing that the
Company has a working capital deficiency, accumulated deficit from
recurring net losses and significant short-term debt obligations
maturing in less than one year as of Oct. 31, 2015. All these
factors raise substantial doubt about its ability to continue as a
going concern.
PROFESSIONAL DIVERSITY: To Effect Reverse Common Stock Split
------------------------------------------------------------
Professional Diversity Network, Inc., had filed a Certificate of
Amendment to its Amended and Restated Certificate of Incorporation
to effect a 1-for-8 reverse stock split of its common stock that is
expected to become effective at 12:01 a.m. EDT on Sept. 27, 2016,
and the Company's common stock is expected to begin trading on a
post-split basis at the open of trading on Sept. 27, 2016.
At the Annual Meeting held Sept. 26, 2016, the Company's
stockholders approved the proposal authorizing the Board of
Directors to implement the reverse stock split at a ratio within
the range from 1-for-2 to 1-for-15, and to amend the Company's
Amended and Restated Certificate of Incorporation to effect the
reverse stock split and to proportionately reduce the number of
shares of common stock the Company is authorized to issue. The
Board of Directors approved a final 1-for-8 ratio immediately
following the Annual Meeting of Stockholders. The reverse stock
split was undertaken to raise the per share trading price of the
Company's common stock to regain compliance with the $1.00 per
share minimum bid price requirement for continued listing on the
Nasdaq Capital Market.
The reverse stock split will reduce the number of shares of the
Company's outstanding common stock from approximately 14.5 million,
to approximately 1.8 million and the number of shares of common
stock the Company is authorized to issue will be reduced from 25
million to approximately 3.1 million. Any fractional shares
resulting from the reverse stock split will be rounded up to the
next whole share. Proportional adjustments will be made to the
Company's outstanding stock options and warrants, and the number of
shares of common stock authorized for issuance under the Company's
2013 Equity Compensation Plan will be proportionately reduced.
The Company's shares will continue to trade on The Nasdaq Capital
Market under the symbol "IPDN" and a new CUSIP number, 74312Y 202,
has been assigned to the Company's common stock as a result of the
reverse stock split.
Continental Stock Transfer & Trust Company, Inc., the Company's
transfer agent, will be acting as the exchange agent in connection
with the reverse stock split. Stockholders holding common stock in
certificated form will receive instructions from the transfer agent
how to surrender the certificates representing the pre-split shares
in exchange for the new certificates. Stockholders who hold their
shares electronically or in street name are not required to take
any action to effect the exchange of their shares.
About Professional Diversity
Professional Diversity Network, Inc. is a dynamic operator of
professional networks with a focus on diversity. The Company uses
the term "diversity" to describe communities, or "affinities," that
are distinct based on a wide array of criteria which may change
from time to time, including ethnic, national, cultural, racial,
religious or gender classification. The Company serves a variety
of such communities, including Women, Hispanic-Americans,
African-Americans, Asian-Americans, Disabled, Military
Professionals, and Lesbian, Gay, Bisexual and Transgender (LGBT).
The Company's goal is (i) to assist its registered users and
members in their efforts to connect with like-minded individuals,
identify career opportunities within the network and (ii) connect
members with prospective employers while helping the employers
address their workforce diversity needs. The Company believes that
the combination of its solutions allows it to approach recruiting
and professional networking in a unique way and thus create
enhanced value for its members and clients.
As of June 30, 2016, Professional Diversity had $37.4 million in
total assets, $16.5 million in total liabilities and $20.9
million in total stockholders' equity.
The Company reported a net loss of $35.8 million in 2015 following
a net loss of $3.65 million in 2014.
PSC INDUSTRIAL: Moody's Lowers CFR to B3; Outlook Stable
--------------------------------------------------------
Moody's Investors Service downgraded the ratings of PSC Industrial
Outsourcing, LP (PSC), including its Corporate Family Rating to B3
from B2 and Probability of Default Rating (PDR) to B3-PD from
B2-PD. Concurrently, the ratings on the bank credit facility were
downgraded, including the first lien term loan and revolving credit
facility to B2 from B1, and the second lien term loan to Caa2 from
Caa1. The ratings outlook is stable.
The ratings downgrade reflects lower than expected operating
performance with margins and cash flow pressured by top-line
declines, despite a large proportion of recurring revenue, leading
to sustained high leverage, weak coverage metrics and reported
operating losses. Moreover, Moody's anticipates that leverage will
remain elevated and earnings under pressure amidst a difficult
operating environment, including lingering weakness and limited
visibility into the timing of a meaningful recovery in the
company's energy end markets.
Moody's took these rating actions:
Corporate Family Rating: downgraded to B3 from B2;
Probability of Default: downgraded to B3-PD from B2-PD;
Senior secured revolving credit facility: downgraded to B2
(LGD3) from B1 (LGD3);
Senior secured first lien term loan: downgraded to B2 (LGD3)
from B1 (LGD3);
Senior secured second lien term loan: downgraded to Caa2 (LGD5)
from Caa1 (LGD5).
The ratings outlook is stable.
RATINGS RATIONALE
The B3 CFR reflects Moody's expectation that challenging business
conditions and competitive pressures will continue to weigh on
PSC's earnings and free cash flow generation over the next year,
with a low likelihood of meaningful debt reduction, resulting in
relatively high leverage of around 5x (all metrics inclusive of
Moody's standard adjustments) and limited interest coverage
(EBITA/interest), currently below 1x. The rating also reflects the
company's modest scale with about $350 million of run rate revenue
and the fairly competitive landscape for many of its services,
which limits margin expansion opportunities. These factors
increase the likelihood of acquisitions, which Moody's expects PSC
would fund via free cash flow and the incurrence of some additional
debt, leading to relatively unchanged credit metrics. Customer
concentration is high with the top 10 contributing about 60% of
annual revenues.
The rating also considers PSC's large recurring revenue base, of
which approximately 60% is derived from service locations embedded
within customer facilities, as well as its solid market presence
across the US. The company employs advanced technology, which
increases accuracy and safety practices. Its long-standing
relationships, particularly with blue chip customers, help to
offset the high customer concentration. The adequate liquidity
profile lends support to the rating.
The stable outlook reflects Moody's expectation for flat to low
single digit organic revenue growth over the next year, as growth
in the utilities segment (including the impact of some recent
customer wins) helps to offset lingering energy end-market
pressures, and as demand for industrial and specialty environmental
services keeps up with regulatory requirements and GDP growth. The
company's sophisticated operational and back office advantages
should enable it take market share from small competitors. The
stable outlook anticipates that credit metrics will remain
supportive of the B3 rating, aided by cost measures and growth in
the company's utilities segment.
The one-notch downgrades in the first and second lien debt, to B2
and Caa2 respectively, incorporate the impact of the lower CFR.
The ratings could be downgraded with expectation of a continuation
of operating losses or rather low profitability with modestly
positive annual free cash flow generation at or below about $5
million. An expectation of declining EBIT margins, Debt to EBITDA
above 5.5x and sustained negative free cash flow or poor covenant
headroom would also lead to a downgrade, as would
shareholder-friendly actions that compromise debt-holder
interests.
Upward ratings momentum could occur with an upward inflection in
revenues and/or operating profit such that the prospect of debt
reduction beyond the modest scheduled amortization would improve
meaningfully. Expectation of Debt to EBITDA that approaches the
mid to low 4x, EBITA to interest approximating 1.5x and/or free
cash flow to debt approaching the mid-single digits could also lead
to higher ratings.
The principal methodology used in these ratings was Environmental
Services and Waste Management Companies published in June 2014.
PSC Industrial Outsourcing, LP provides industrial and specialty
cleaning services to oil & gas, utilities, chemical and general
manufacturing companies. The company is a subsidiary of PSC
Industrial Holdings Corp., which is owned by funds affiliated with
Littlejohn & Co. The company's annual revenue base is around
$350 million.
PUERTO RICO: Pension Fund Joins Suit vs. UBS Over Muni Bonds
------------------------------------------------------------
Romy Varghese, writing for Bloomberg News, reported that Puerto
Rico's retirement system, on the brink of insolvency, is joining a
lawsuit against UBS Group AG, faulting the company for poor
investment returns on $3 billion it borrowed in an effort to
bolster the pension.
According to the report, UBS underwrote bonds sold by the employees
and judiciary retirement systems in 2008 and served as the
investment consultant. The income from reinvesting the proceeds
was supposed to far exceed the cost of borrowing, delivering a
profit, the report related. Puerto Rico said in a statement that
much of the proceeds went instead into low-yielding accounts that
produced "negative investment income since day one," the report
further related.
UBS served as a major banker for the U.S. territory, which has been
defaulting on a growing share of its debt and has been placed under
federal financial oversight, the report said. The bank was able to
legally serve as an adviser, underwriter and bond-fund manager even
though such multiple roles are barred on the mainland because of
the conflicts of interest, the report added.
QUANTUM CORP: Grants Board Observer Rights to Messrs. Mutch & Rau
-----------------------------------------------------------------
Quantum Corporation has entered into an agreement with VIEX Capital
Advisors, LLC and its affiliates, under which Quantum has granted
Board observer rights to John Mutch and Raghu Rau until Dec. 1,
2016, subject to certain conditions. In addition, Quantum will use
its reasonable best efforts to hold its Annual Meeting of
Stockholders on Jan. 31, 2017, or another date mutually agreed by
the parties.
Under the Agreement, VIEX will abide by certain standstill
provisions related to the solicitation of proxies and other matters
until Dec. 1, 2016, subject to earlier termination under certain
circumstances.
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com/-- is a storage company specializing in
backup, recovery and archive. Quantum provides a comprehensive,
integrated range of disk, tape, and software solutions supported
by a world-class sales and service organization.
Quantum reported net income of $16.7 million on $553 million of
total revenue for the year ended March 31, 2015, compared to a net
loss of $21.5 million on $553 million of total revenue for the
year ended March 31, 2014.
As of June 30, 2016, Quantum had $209 million in total assets, $338
million in total liabilities and a $129 million total stockholders'
deficit.
QUANTUM CORP: VIEX Capital Reports 11% Stake as of Sept. 23
-----------------------------------------------------------
In an amended Schedule 13D filed with the Securities and Exchange
Commission, these reporting persons disclosed beneficial ownership
of Quantum Corporation's common stock as of Sept. 23, 2016:
Shares Percentage
Beneficially of
Reporting Person Owned Shares
---------------- ------------ -----------
VIEX Opportunities Fund, LP 7,407,865 2.8%
- Series One
VIEX Opportunities Fund, LP 1,413,191 Less Than
- Series Two 1%
VIEX Special Opportunities 20,710,666 7.7%
Fund III, LP
VIEX GP, LLC 8,821,056 3.3%
VIEX Special Opportunities 20,710,666 7.7%
GP III, LLC
VIEX Capital Advisors, LLC 29,531,722 11%
Eric Singer 29,531,722 11%
On Sept. 23, 2016, Quantum Corp entered into an agreement with the
Reporting Persons under which the Company has granted Board
observer rights to John Mutch and Raghavendra Rau until Dec. 1,
2016, subject to certain conditions. In addition, the Company will
use its reasonable best efforts to hold its Annual Meeting of
Stockholders on Jan. 31, 2017, or another date mutually agreed by
the parties.
Under the Agreement, the Reporting Persons have agreed to abide by
certain standstill provisions related to the solicitation of
proxies and other matters until Dec. 1, 2016, subject to earlier
termination under certain circumstances.
A full-text copy of the regulatory filing is available at:
https://is.gd/n9f6mx
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com/-- is a storage company specializing in
backup, recovery and archive. Quantum provides a comprehensive,
integrated range of disk, tape, and software solutions supported
by a world-class sales and service organization.
Quantum reported net income of $16.7 million on $553 million of
total revenue for the year ended March 31, 2015, compared to a net
loss of $21.5 million on $553 million of total revenue for the
year ended March 31, 2014.
As of June 30, 2016, Quantum had $209 million in total assets, $338
million in total liabilities and a $129 million total stockholders'
deficit.
RADIAN GUARANTY: S&P Raises ICR to 'BB'; Outlook Stable
-------------------------------------------------------
S&P Global Ratings said it raised its financial strength and
long-term issuer credit ratings on Radian Guaranty Inc. to 'BBB'
from 'BBB-', and raised its long-term issuer credit rating on
Radian Group Inc. to 'BB' from 'BB-'. The outlook is stable. S&P
Global Ratings also raised its ratings on senior unsecured notes
issued by Radian Group Inc. to 'BB' from 'BB-'.
"The upgrade reflects the relative strengthening of Radian's
financial risk profile, prospectively aided by a decline in
leverage in part due to execution of a capital management plan,
earnings accretion, and reduced reliance on double leverage
improving the quality of capital over the next few years," said S&P
Global Ratings credit analyst Hardeep Manku.
Execution of the quota share (QS) (and subsequent upstreaming of
$325 million of surplus notes from Radian Guaranty) and issuance of
senior notes (due 2021) earlier this year provided sufficient
resources for the company to progress on its capital management
plan. The company purchased a significant amount of convertible
notes due 2019 (and 2017) and paid down senior notes maturing 2017,
thereby spreading out the debt maturity profile and easing up the
liquidity pressure on the holding company. S&P expects Radian to
further act on remaining convertibles as the opportunity arises and
to target lower leverage levels over the near-to-medium term.
Further supporting S&P's ratings are the company's adequate
competitive position, reflecting its position as one of the leading
mortgage insurers in the U.S., relatively diverse base of
customers, improved operating performance, and national
footprint--partially offset by the mono-line nature of the
business.
The stable outlook reflects S&P's expectation of a supportive
macroeconomic environment, sustainable upper-adequate
capitalization, improved leverage position, and adequate
competitive position supported by ongoing compliance with Private
Mortgage Insurer Eligibility Requirements, which should enable
Radian to write new business and achieve operating metrics in line
with S&P's expectations.
S&P could raise the ratings during the next two years if
capitalization improves to moderately strong, assuming successful
execution of management's capital management plan results in
leverage in line with or better than S&P's expectations and
provided the macroeconomic environment remains supportive.
S&P could lower the ratings during the next two years if
capitalization declines to lower-adequate or financial
leverage/coverage ratios deteriorate significantly. This could
result from an earnings disruption that slows or impairs capital
build-up--including deterioration in the economy--or from increased
capital requirements from higher-than-expected volumes of new
business with an expanded risk profile, or from increased debt
load. Further downside risk emanates from the potential for
contingent liabilities (including from an unresolved tax dispute)
that stretch Radian's resources materially.
RENNOVA HEALTH: Files Copy of Investor Presentation With SEC
------------------------------------------------------------
Rennova Health, Inc., filed with the Securities and Exchange
Commission a copy of an investor presentation that it may present
to investors, analysts and others. A full-text copy of the
presentation materials is available for free at:
https://is.gd/2Jknkz
About Rennova
Rennova Health, Inc. is a vertically integrated provider of a suite
of healthcare related products and services. Its principal lines
of business are diagnostic laboratory services, and supportive
software solutions and decision support and informatics operations
services.
As of June 30, 2016, Rennova had $18.35 million in total assets,
$29.28 million in total liabilities and a $10.93 million total
stockholders' deficit.
The Company reported a net loss attributable to the Company's
common shareholders of $36.35 million following net income
attributable to the Company's common shareholders of $2.81
million.
"Although our financial statements have been prepared on a going
concern basis, we have recently accumulated significant losses and
have negative cash flows from operations, which raise substantial
doubt about our ability to continue as a going concern.
"If we are unable to improve our liquidity position we may not be
able to continue as a going concern. The accompanying consolidated
financial statements do not include any adjustments that might
result if we are unable to continue as a going concern and,
therefore, be required to realize our assets and discharge our
liabilities other than in the normal course of business which could
cause investors to suffer the loss of all or a substantial portion
of their investment," the Company stated in its annual report for
the year ended Dec. 31, 2015.
REYNOLDS GROUP: S&P Raises CCR to 'B+' on $500MM Incremental Loan
-----------------------------------------------------------------
S&P Global Ratings said that it has raised its corporate credit
rating on Reynolds Group Holdings Ltd. to 'B+' from 'B'. The
outlook is stable.
At the same time, S&P raised its issue-level rating on the
company's unsecured debt to 'B-' from 'CCC+'. The '6' recovery
rating remains unchanged, indicating S&P's expectation for
negligible recovery (0%-10%) in the event of payment default.
Additionally, S&P affirmed its 'B+' issue-level rating on Reynolds'
senior secured debt after incorporating the proposed $500 million
incremental senior secured term loan due 2023. Due to the pro
forma increase in the company's secured debt from the proposed
transaction, S&P revised its recovery rating on the debt to '3'
from '2'. The '3' recovery rating indicates S&P's expectation for
moderate (50%-70%; upper half of the range) recovery for lenders in
the event of a payment default.
Reynold will use the proceeds from the incremental term loan, along
with approximately $755 million in balance-sheet cash, to
refinance, redeem, or repurchase its outstanding 5.625% senior
notes due 2016 and 9.875% senior notes due 2019 and pay related
fees and expenses.
"The upgrade reflects the planned reduction in Reynolds' debt and
the proposed refinancing, which will extend the company's debt
maturities and decrease its future interest expense (because of the
lower coupon rates)," said S&P Global credit analyst Steven
Mcdonald. "We expect that the company's credit measures will
remain highly leveraged, including an adjusted debt-to-EBITDA
metric of about 6.5x by year-end 2017."
The stable outlook on Reynolds reflects S&P's expectation that the
company's relatively stable end-market demand and attractive EBITDA
margins will support solid free cash generation. Additionally, S&P
anticipates that the proposed reduction in the company's debt will
allow it to support a total adjusted debt-to-EBITDA leverage metric
of around 6.5x in the next 12 months.
Over the next 12 months, S&P could raise its ratings on Reynolds if
the company is able to substantially improve or successfully
resolve its governance-related issues, which currently limit the
upside potential for S&P's ratings. S&P could also raise its
ratings if the company maintains a less aggressive financial policy
and management makes a well-articulated commitment to improve
Reynolds' credit metrics.
S&P could lower its ratings on Reynolds if the company pursues a
more aggressive financial policy that includes large acquisitions
or shareholder distributions. This could lead the company to
increase its debt leverage such that its total adjusted
debt-to-EBITDA metric increases above 7x.
RICE ENERGY: Moody's Puts B2 CFR Under Review for Upgrade
---------------------------------------------------------
Moody's Investors Service placed the ratings of Rice Energy, Inc.
under review for upgrade, including the B2 Corporate Family Rating,
the B2-PD Probability of Default Rating (PDR), and the B3 senior
unsecured notes rating following Rice's announced agreement to
purchase Vantage Energy Inc. (Vantage, unrated) and its midstream
gas gathering business, Vista Gathering LLC (Vista, unrated).
Rice's SGL-2 Speculative Grade Liquidity Rating remains unchanged.
"With the acquisition of Vantage and Vista, Rice will nearly double
its Marcellus acreage position and significantly increase its
natural gas gathering capacity in the basin," said Vice President
Senior Analyst, RJ Cruz. "Rice's leverage metrics will improve
substantially based on our expectation that the company will fund
over 85% of the transaction with equity and retire the existing
debt at Vantage."
On Review for Upgrade:
Issuer: Rice Energy, Inc.
Corporate Family Rating, Review for Upgrade, currently B2
Probability of Default Rating, Review for Upgrade, currently B2-
PD
Senior Unsecured Notes, Review for Upgrade, currently B3 (LGD5)
Outlook Actions:
Issuer: Rice Energy, Inc.
Outlook, Rating Under Review From Stable
RATINGS RATIONALE
These rating actions were prompted by Rice's announcement yesterday
that it will acquire Vantage and Vista for approximately $2.7
billion. The acquisition would nearly double Rice's Marcellus
acreage to 179,000 net acres and would expand its drilling
inventory in the play to more than 1,100 locations. Notably,
Vantage's Marcellus acreage in Greene County, Pennsylvania is
contiguous to Rice's existing footprint.
The acquisition is expected to close on or before Nov. 15, 2016,
subject to customary closing conditions. The review for upgrade of
Rice's B2 CFR reflects Moody's expectation that the CFR will likely
be upgraded to B1 at the close of the transaction. The review will
focus on the combined entity's production and reserve base, hedge
position, and Moody's evaluation of the company's cash flow and
leverage metrics based on Moody's commodity price outlook when the
transaction closes. Risks related to integration and future
development of Vantage's upstream assets should be manageable given
the acquisition is adjacent to Rice's acreage in the Marcellus.
Moody's expects the review to conclude following the close of the
transaction.
The review on the rating of the senior unsecured notes will
consider the size of the revolving credit facilities committed
borrowing base at the time the transaction closes relative to the
senior notes outstanding in addition to Moody's expectations for
future usage of the revolver. A significant increase in revolver
borrowing capacity and/or expectations for revolver utilization
could result in the senior unsecured notes rating being confirmed
at B3 despite an upgrade of the CFR to B1.
The $2.7 billion transaction consists of two parts: (1) $2.1
billion for Vantage's upstream business and outstanding debt and
(2) $600 million for Vista. Concurrent with the announcement of
this transaction, Rice launched a $1 billion equity issuance to the
public. Proceeds from that offering and $980 million equity issued
directly to Vantage's owners will fund the upstream purchase ($1.4
billion) and retire Vantage debt, approximately $700 million. At
the same time, Rice Midstream Partners LP (RMP) will do a $250
million equity offering or issue $250 million units to Rice and
will draw $350 million on its revolver to fund the acquisition of
Vista.
The acquisition is sizeable and would increase Rice's current
production levels by over 50%. Reserves would more than double
from year-end 2015 level. Moreover, the acquisition of Vista will
increase Rice's midstream throughput, solidifying its position as a
leading gas gatherer in the Marcellus.
Given the largely equity financed nature of the transaction,
Moody's expects Rice's cash flow and leverage metrics to improve
substantially. Moody's expects Rice's Retained Cash Flow/Debt to
improve to over 25% by year-end 2017 from 11.3% for the 12 months
ending June 30, 2016, consolidated for Rice's midstream businesses.
Moody's also expects E&P Debt/Average Daily Production to decline
to under $8,000/boe from approximately $11,800/boe at June 30,
2016.
Rice Energy Inc. is an independent oil and gas exploration and
production company with production operations primarily in the
Marcellus Shale, and to a smaller scale and more early stage
production in the Utica Shale. In December 2014, Rice completed an
IPO of a master limited partnership, Rice Midstream Partners LP,
that contained certain of its midstream assets. Rice owns 33% of
the LP units of Rice Midstream Partners via its ownership of Rice
Midstream Holdings. Rice Midstream Holdings owns 92% of GP
Holdings, which also owns 100% of the MLP's incentive distribution
rights (IDRs).
The principal methodology used in these ratings was Global
Independent Exploration and Production Industry published in
December 2011.
RICE ENERGY: S&P Affirms 'B' CCR, On CreditWatch Positive
---------------------------------------------------------
S&P Global Ratings said that it affirmed its 'B' corporate credit
rating on U.S.-based Rice Energy Inc., and placed its ratings on
the company, including the corporate credit rating, on CreditWatch
with positive implications.
"The CreditWatch placement reflects the potential for an upgrade
when the acquisition closes," said S&P Global Ratings' credit
analyst Michael McConnell. "If the transaction closes as expected,
we could raise our ratings on Rice Energy, based on the company's
business risk profile assessment improving to weak from vulnerable
due to its increased scale and reserve size."
Upon the acquisition's closing, S&P expects Rice Energy to benefit
from increased scale, scope, and diversity, resulting from the
larger reserve base and increase in production, which the company
now expects to grow by 70% in 2017. At the same time, S&P expects
the company's credit measures to improve slightly as a result of
the proposed equity funding and increase in production.
S&P's 'B' corporate credit rating on Rice Energy is based on S&P's
assessment of the company's business risk profile as vulnerable and
its financial risk profile as aggressive.
S&P expects the company to have adequate liquidity pro forma for
the transaction, with liquidity sources exceeding uses by more than
1.2x.
During the 90-day CreditWatch period, S&P will gather additional
information on the transaction, including the ultimate size of the
company's borrowing base after the deal closes. If the transaction
is completed as proposed, S&P would expect to raise its ratings on
Rice Energy, based on the company's larger scale, scope, diversity,
and slightly improved credit measures. S&P expects to resolve the
CreditWatch status upon closing of the acquisition, which S&P
expects to occur by year-end.
RICHARD HAISFIELD: Disclosure Statement Hearing on November 10
--------------------------------------------------------------
Judge Paul M. Glenn of the U.S. Bankruptcy Court for the Middle
District of Florida has scheduled a hearing to be held on November
10, 2016 at 1:30 p.m., to consider and rule on the disclosure
statement filed by Richard Haisfield and Audrey L. Haisfield and
any objections or modifications. Any objection to the proposed
disclosure statement shall be filed and served 7 days before the
hearing date.
About The Haisfields
Richard Haisfield and Audrey L. Haisfield filed a Chapter 11
petition (Bankr. M.D. Fla. Case No. 11-08765), on December 2, 2011.
Judge Paul M. Glenn presides over the case. The attorney for the
debtors is: Jimmy D Parrish, whose address is 200 S Orange Avenue,
SunTrust Center − Suite 2300, Orlando, FL 32801
RICK KHOMAL BENISASIA: Plan to Pay Unsecured Creditors in Full
--------------------------------------------------------------
General unsecured creditors will receive full payment of their
claims under the Chapter 11 plan of reorganization proposed by Rick
Khomal and Prabhjot Kaur Benisasia.
Under the plan, general unsecured creditors will be paid 100% of
their Class 5 claims. These creditors, which assert a total of
$9,016 in claims, will receive a monthly payment of $150.27 for 60
months.
Funds to be used to make cash payments under the plan will come
from the Debtors' income, according to the disclosure statement
filed on Sept. 20 with the U.S. Bankruptcy Court for the Southern
District of Florida.
A copy of the disclosure statement is available for free at
https://is.gd/4cIXUi
The Debtors are represented by:
David Lloyd Merrill, Esq.
Merrill P.A.
Trump Plaza Office Center
525 S. Flagler Drive, 5th Floor
West Palm Beach, Florida 33401
Phone: +1.561.877.1111
Fax: +1.561.832.7668
About The Benisasias
Rick Khomal and Prabhjot Kaur Benisasia are residents of Palm Beach
County, Florida, who own and manage Seaspray Resort, Ltd.
Seaspray, a company previously in bankruptcy, owns a commercial
property and operates as a hotel and resort facility, which the
Debtors manage, with restaurant space and one manager's apartment.
The Debtors sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D. Fla. Case No. 16-11593) on February 3, 2016.
RICOCHET ENERGY: Needs Until October 6 to File Chapter 11 Plan
--------------------------------------------------------------
Ricochet Energy, Inc. and Ricochet Interests, LLC request the U.S.
Bankruptcy Court for the Western District of Texas to extend the
exclusive periods to file and solicit acceptances of a Chapter 11
plan for 20 days to and including October 6, 2016 and December 20,
2016, respectively.
Absent a new extension, the Debtors' extended exclusive filing
period was slated to expire on Sept. 17, 2016 and their exclusive
solicitation period is to expire Nov. 16, 2016.
The Debtors relate that they have been in discussions with the
Unsecured Creditors' Committee regarding reorganization of the
Debtors, which have been ongoing for over a month. According to the
Debtors, the Debtors and the Committee have been able to develop an
exit strategy to be formulated with a plan to be final on or before
October 6, 2016.
The Debtors believe that the final negotiations will be helped by
the extension of exclusivity. The Committee does not object to the
requested extension.
The Debtors assert that termination of exclusivity could be very
disruptive to the Debtors' efforts to develop a Chapter 11 plan.
Considering the complexities of the Chapter 11 Cases and the
multiple leases and contracts the Debtors have been negotiating,
neither the Debtors nor any other party in interest will be in a
position to formulate, promulgate and build consensus for a Chapter
11 plan before October 6, 2016.
Moreover, the Debtors assert that expiration of the Exclusive
Periods would likely lead to adversarial situations that would
cause deterioration in the Debtors' operations, the value of their
estates and their ability to negotiate a consensual Chapter 11
plan.
About Ricochet Energy
Ricochet Energy, Inc. and Ricochet Interests, Ltd. sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Tex. Case No. 16-51148 and Bankr. W.D. Tex. Case No. 16-51149) on
May 18, 2016. The petition was signed by Jerry L. Hamblin,
president and CEO. A motion for joint administration of the
Chapter 11 cases is pending.
Ricochet Energy estimated both assets and liabilities in the range
of $1 million to $10 million.
Ricochet Interests estimated assets of $10 million to $50 million
and debts of $1 million to $10 million.
The Debtors are represented by Michael G. Colvard, Esq. at MARTIN &
DROUGHT, P.C. of San Antonio, TX.
RONALD B. GREY: Court Junks Appeal From Chase Claim Order
---------------------------------------------------------
In the case captioned IN RE: MODERN ALLOYS INC., MAFAB, INC. RONALD
B. GREY, Case No. SA CV-15-1429-MWF (C.D. Calif.), Judge Michael W.
Fitzgerald of the United States District Court for the Central
District of California, Santa Ana Division, dismissed the appeal as
moot as during the pendency of the appeal Grey dismissed the
underlying adversary proceeding, which rendered the requested
relief moot.
Before the Court is a bankruptcy appeal from the United States
Bankruptcy Court's Order on Objection to Claims, which issued on
September 1, 2015.
Grey filed an Objection to Defendant-Appellee JPMorgan Chase Bank,
N.A.'s claims, arguing among other things that there was no
evidence to support Chase's asserted secured interest and no
evidence to indicate that Chase was the owner and holder of the
notes.
Grey voluntarily dismissed his adversary case against Chase. On
September 1, 2015, the bankruptcy court entered its Order, which
stated that Chase's Claim No. 7 was allowed. On September 3, 2016,
Grey appealed. On January 7, 2016, the bankruptcy court dismissed
Grey's Chapter 11 case along with the jointly administered case of
Modern Alloy, Inc., under 11 U.S.C. Section 1112. No party appealed
the dismissal.
A full-text copy of the Order dated September 13, 2016 is available
at https://is.gd/WyO4AA from Leagle.com.
Ronald B Grey, Appellant, is represented by Charity Joy Miller,
Esq. -- cmiller@goeforlaw.com -- Goe and Forsythe LLP.
Ronald B Grey, Appellant, is represented by Donald Walter Reid,
Esq. -- dreid@goeforlaw.com -- Goe and Forsythe LLP, Marc C.
Forsythe, Esq. -- mforsythe@goeforlaw.com -- Goe and Forsythe LLP &
Robert P. Goe, Esq. -- rgoe@goeforlaw.com -- Goe and Forsythe LLP.
JPMorgan Chase, Appellee, is represented by John M. Sorich, Esq. --
john.sorich@piblaw.com -- Parker Ibrahim and Berg LLC.
JPMorgan Chase, Appellee, is represented by Heather Elizabeth
Stern, Esq. -- heather.stern@piblaw.com -- Parker Ibrahim & Berg,
LLC.
RP BROADCASTING: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: RP Broadcasting Idaho, LLC
1140 West Highway 22
Jackson, WY 83001
Case No.: 16-28578
Chapter 11 Petition Date: September 28, 2016
Court: United States Bankruptcy Court
District of Utah (Salt Lake City)
Debtor's Counsel: Penrod W. Keith, Esq.
DURHAM JONES & PINEGAR, P.C.
111 East Broadway, Suite 900
P O Box 4050
Salt Lake City, UT 84110-4050
Tel: (801) 415-3000
Fax: (801) 415-3500
E-mail: pkeith@djplaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Richard O. Mecham, president and CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/utb16-28578.pdf
S & H OF WEST: Disclosure Statement Hearing on Oct. 25
------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida is
set to hold a hearing on October 25, at 9:30 a.m., to consider
approval of the disclosure statement and the Chapter 11 plan of
reorganization of S & H of West Palm Beach, Inc.
The hearing will take place at the Flagler Waterview Building,
Courtroom A, 8th Floor, 1515 North Flagler Drive, West Palm Beach,
Florida.
Creditors are required to file their ballots accepting or rejecting
the plan on or before October 14. The deadline for filing
objections to the disclosure statement and the plan is October 20.
The restructuring plan filed on September 8 provides that the
general unsecured creditors will receive a distribution of 8% of
their Class 1 claims. These creditors will be paid on a pro-rata
basis at $345.37 per month over a term of 60 months.
Payments under the plan will be funded by the Debtor's continued
operation of its dry cleaning business.
About S & H of West Palm Beach
S & H of West Palm Beach, Inc., sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 16-13452) on
March 10, 2016. The Petition was signed by the Company's
President, Hamid B. Bhatti. The Debtor is represented by Stephen
P. Orchard, Esq., at the Law Offices of Stephen Orchard.
At the time of filing, the Debtor had $50,000 in estimated assets
and $100,000 to $500,000 in estimated liabilities.
The Office of the U.S. Trustee disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of S & H of West Palm Beach, Inc.
S-3 PUMP SERVICE: Unsecureds To Recoup 40%-50% Under Plan
---------------------------------------------------------
S-3 Pump Service, Inc., filed with the U.S. Bankruptcy Court for
the Western District of Louisiana a disclosure statement for the
Debtor's plan of reorganization.
Under the Plan, Class 19 General Unsecured Claims, estimated at
$10,000,000, are impaired. Holders of Class 19 Claims will receive
Pro Rata share of Creditors Trust Interests. Estimated recovery
under this class is 40-50%.
Through its future business operations, the Reorganized Debtor will
generate earnings sufficient to service its Plan obligations to the
Secured Creditors and the Creditors Trust.
In order to evidence its seriousness and good faith in these
negotiations, the principals of Hallwood S3 (which will be the
specific Hallwood Financial-affiliated entity to be part of the
Reorganized Debtor) has agreed to deliver or cause to be delivered
to Debtor's counsel in escrow $2 million cash as a deposit against
its funding obligations under the Plan
The Disclosure Statement is available at:
http://bankrupt.com/misc/lawb16-10383-245.pdf
S-3 Pump Service, Inc., provider of high pressure pumping service,
filed a Chapter 11 bankruptcy petition (Bankr. W.D. La. Case No.
16-10383) on March 4, 2016. The petition was signed by Malcolm H.
Sneed, III, the president. Judge Jeffrey P. Norman is assigned to
the case.
The Debtor estimated assets and debt in the range of $10 million to
$50 million.
Blanchard, Walker, O'Quin & Roberts serves as the Debtor's
counsel.
S-3 PUMP: Selling Collateral to CFSC to Pay Claim
-------------------------------------------------
S-3 Pump Service, Inc., asks the U.S. Bankruptcy Court for the
Western District of Louisiana to authorize the sale of Caterpillar
320EL Hydraulic Excavator, Serial No. WBK01087 ("Collateral") to
Caterpillar Financial Services Corp. ("CFSC") in exchange for
CFSC's credit bid in the amount of $88,006, plus all accrued
postpetition interest at the rate of $5 per day.
A hearing on the Motion is set for Nov. 1, 2016 at 10:00 a.m. The
objection deadline is Oct. 25, 2016.
Prior to the Petition Date, on Aug. 27, 2014, the Debtor entered
into an Installment Sales Contract, Transaction No. 2382037, with
Louisiana Machinery Co., LLC, for the purchase of the Collateral
for the amount of $133,747.
Pursuant to the Contract, to secure the payment and performance of
the Debtor's obligations under the Contract, the Debtor granted
Louisiana Machinery a continuing, first priority security interest
in the Collateral. The Contract further provided that Louisiana
Machinery may thereafter assign the CFSC without notice to Debtor
and in which case CFSC would have all rights and remedies of
Louisiana Machinery under the Contract. Thereafter, Louisiana
Machinery sold, assigned, transferred, and set over to CFSC all of
its interest in and rights and remedies under the Contract by
assignment.
On Sept. 11, 2014, CFSC filed a UCC-1 Financing Statement, thereby
perfecting its security interest in the Collateral.
The Debtor has listed CFSC on its schedules with a secured claim
totaling $87,868. The Debtor values CFSC's Collateral at $90,000.
CFSC asserts that the outstanding indebtedness due on the Contract
as of the Petition Date was $88,006. CFSC does not dispute that it
was oversecured as of the Petition Date. However, interest has
continued to accrue at the rate of $5 per day since the Petition
Date, leaving little if any remaining equity in the Collateral. The
Debtor has not made any adequate protection payments to CFSC.
The Debtor has concluded that the estate does not have a long-term
need for the Collateral, that the Collateral is not necessary for
an effective reorganization, and that it is in the best interests
of the estate for the Debtor to sell the Collateral pursuant to
Section 363(b).
On Sept. 12, 2016, the Debtor filed its Disclosure Statement for
Plan of Reorganization Pursuant to Chapter 11 of the Bankruptcy
Code and Chapter 11 Plan of Reorganization. Neither the Disclosure
Statement nor Plan addresses the claim of CFSC. Instead, the Debtor
and CFSC have agreed that the Debtor will sell the Collateral to
CFSC free and clear of all liens and encumbrances pursuant to 11
U.S.C. Sec. 363(b)(1) in full satisfaction of CFSC's claim against
the Debtor and in exchange for a credit pursuant to 11 U.S.C. Sec.
363(k).
Considering the good faith of CFSC and the reasonableness of the
credit bid, the Debtor requests that the Court find that good cause
exists to authorize the consummation of the sale of the Collateral
without subjecting the Order to a stay of execution, as permitted
under Federal Rules of Bankruptcy Procedure 7062 and 6004(h).
The Purchaser can be reached at:
CATERILLAR FINANCIAL SERVICES CORP.
2120 West End Ave.
Nashville, TN 37203-0986
About S-3 Pump Service, Inc.
S-3 Pump Service, Inc., provider of high pressure pumping service,
filed a Chapter 11 bankruptcy petition (Bankr. W.D. La. Case No.
16-10383) on March 4, 2016. Honorable Judge Jeffrey P. Norman is
assigned to the case.
The petition was signed by Malcolm H. Sneed, III, the president.
The Debtor estimated assets and debt in the range of $10 million
to
$50 million.
Blanchard, Walker, O'Quin & Roberts serves as the Debtor's
counsel.
SALESFORCE.COM INC: Egan-Jones Hikes Sr. Unsecured Ratings to BB-
-----------------------------------------------------------------
Egan-Jones Ratings Company, on Sept. 23, 2016, upgraded the senior
unsecured ratings of debt issued by salesforce.com Inc. to BB- from
B+.
Salesforce.com is an American cloud computing company headquartered
in San Francisco, California.
SAMSON RESOURCES: Court Denies Extension of Exclusive Periods
-------------------------------------------------------------
Judge Christopher S. Sontchi of the U.S. Bankruptcy Court for the
District of Delaware denied Samson Resources Corporation, et al.'s
Motion which sought the extension of their exclusive periods to
file and solicit acceptances of their chapter 11 plan.
Judge Sontchi also denied the Motions filed by the Official
Committee of Unsecured Creditors which sought the Court's
authorization to file certain information under seal, and terminate
the Debtors' exclusive periods to file a chapter 11 plan and
solicit acceptances to the plan, as moot.
Matt Chiappardi, writing for Bankruptcy Law360, reported that
during a hearing in Wilmington, Judge Sontchi denied Samson's
request to extend its exclusivity period another six months through
March 2017, ruling that it wouldn't be "constructive" because the
Company has barely communicated or negotiated with unsecured
creditors, a key stakeholder in the case. Judge Sontchi said that
Samson had not engaged with the committee in good faith, and
"dominated" its dealings with unsecured creditors in an "aggressive
manner," dropping big case developments in its lap.
Law360 says Judge Sontchi's decision now opens the door for
unsecured creditors to file their own Chapter 11 plan for Samson,
which the court may evaluate side by side with the debtor's
strategy that combines raising money through asset sales with a
debt-for-equity swap. The decision also lifts the gate for any
constituency in the case to suggest a Chapter 11 plan, but the
judge said as a practical matter, the case is most likely to come
down to a contest between the debtor and its allies and the
unsecured creditors.
The report added that Judge Sontchi warned the committee to "get
busy" if it indeed wants to put out a rival plan, noting that
Samson is already on track to present the disclosure statement for
its plan in mid-October.
The Debtors, on May 16, 2016, filed a new debt-for-equity Chapter
11 Plan, a copy of whose Disclosure Statement is available at
http://bankrupt.com/misc/SAMSONds0517.pdf
The Plan contemplates an exchange of First Lien Claims for new
first lien debt (including commitments under a new reserve-based
revolving credit facility), Cash (including proceeds from Asset
Sales, if any), and new common equity.
In a subsequent filing, the Creditors Committee submitted a motion
in court seeking the termination of the Debtors' exclusivity
periods to file, and solicit acceptances for that, a Chapter 11
plan. As reported in the May 26, 2016 edition of The Troubled
Company Reporter, the Committee claimed that "the Debtors' Amended
Plan on file represents a no win choice for unsecured creditors:
vote for the plan and get less than one would in a Chapter 7
liquidation; fight the plan and either get nothing or end up six
months down the road with no plan and administrative expenses
running out of control."
About Samson Resources Corporation
Samson Resources Corporation, et al., filed Chapter 11 bankruptcy
petitions (Bankr. D. Del. Lead Case No. 15-11934) on Sept. 16,
2015. Philip W. Cook, the executive vice president and CFO, signed
the petition. The Debtors estimated assets and liabilities of more
than $1 billion.
Samson is an onshore oil and gas exploration and production company
with interests in various oil and gas leases primarily located in
Colorado, Louisiana, North Dakota, Oklahoma, Texas, and Wyoming.
The Operating Companies operate, or have royalty or working
interests in, approximately 8,700 oil and gas production sites.
Samson was acquired by KKR and Crestview from Charles Schusterman
in December 2011 for approximately $7.2 billion. The investor
group provided approximately $4.1 billion in equity investments as
part of the purchase price.
Kirkland & Ellis LLP represents the Debtors as general counsel.
Klehr Harrison Harvey Branzburg LLP is the Debtors' local counsel.
Alvarez & Marsal LLC acts as the Debtors' financial advisor.
Blackstone Advisory Partners L.P. serves as the Debtors' Investment
banker. Garden City Group, LLC, serves as claims and noticing
agent to the Debtors.
Andrew Vara, acting U.S. trustee for Region 3, appointed three
creditors of Samson Resources Corp. and its affiliated debtors to
serve on the official committee of unsecured creditors. The
Committee has tapped White & Case LLP as counsel and Farnan LLP as
local counsel.
SANDRIDGE ENERGY: Expects to Emerge from Chapter 11 Next Week
-------------------------------------------------------------
SandRidge Energy, Inc. on Thursday said it expects to emerge from
Chapter 11 reorganization and resume trading the week of Oct. 3,
2016, on the New York Stock Exchange, Ticker (NYSE:SD). SandRidge
Energy also provided an update of its Mid-Continent and Colorado
operations as well as full year 2016 capital
expenditure/operational guidance and hedging.
The Company will release third quarter 2016 earnings results on
Nov. 8, with a related conference call on Nov. 9.
SandRidge plans to invest $225 to $255 million of capital
expenditures in 2016, with $56 million spent during the second
quarter and $110 million during the first half of 2016, excluding
acquisitions and abandonment liabilities.
The Company will host a conference call to discuss these results on
Nov. 9 at 8:00am CT. The telephone number to access the conference
call from within the U.S. is (877) 201-0168 and from outside the
U.S. is (647) 788-4901. The passcode for the call is 86082124. An
audio replay of the call will be available from November 9, 2016
until 11:59pm CT on December 9, 2016. The number to access the
conference call replay from within the U.S. is (855) 859-2056 and
from outside the U.S. is (404) 537-3406. The passcode for the
replay is 86082124.
A copy of the Company's statement on its Operations Update and Full
Year 2016 Guidance is available at https://is.gd/6gp6mH
The Bankruptcy Court for the Southern District of Texas on
Sept. 9, 2016, entered an order confirming the Joint Chapter 11
Plan of Reorganization of SandRidge Energy, Inc. and its Debtor
Affiliates, as modified by the Confirmation Order.
SandRidge Energy said the Plan eliminates $3.7 billion in
pre-petition funded indebtedness.
The Plan contemplates the following treatment of claims against
and
interests in the Debtors:
* Holders of claims under the Debtors' existing first lien
credit facility will receive their proportionate share of a new
$425 million first lien reserve-based revolving credit facility and
$35 million in cash.
* Holders of claims under the Debtors' existing second lien
notes will receive their proportionate share of a new mandatorily
convertible note and new common stock, equal to 83.5%
of the total new common stock after conversion of the mandatorily
convertible note, subject to dilution from various sources.
* Holders of general unsecured claims against the Debtors will
receive their proportionate share of $10 million in cash, $27
million in cash proceeds of a new $35 million mortgage note issued
on certain real property, warrants to purchase new common stock,
and new common stock representing 16.5% of the total new common
stock after conversion of the mandatorily convertible note, subject
to dilution from various sources.
* Holders of certain trade claims against the Debtors were
provided the option to elect to receive 12.5% of their allowed
claim in cash in place of the treatment otherwise received by
general unsecured claims.
* Holders of Company preferred and common stock will receive no
recovery on account of their equity interests.
Unless otherwise specified, the treatment set forth in the Plan
and
Confirmation Order will be in full satisfaction of all claims
against and interests in the Debtors, which will be discharged on
the Effective Date. All of the Company's existing funded debt and
preferred and common stock will be extinguished by the Plan.
Additional information regarding the classification and treatment
of claims and interests can be found in Articles II and III of the
Plan.
About SandRidge Energy, Inc.
SandRidge Energy, Inc. (OTC PINK: SDOC) --
http://www.sandridgeenergy.com/-- is an oil and natural gas
exploration and production company headquartered in Oklahoma City,
Oklahoma, with its principal focus on developing high-return,
growth-oriented projects in the U.S. Mid-Continent and Niobrara
Shale.
SandRidge Energy, Inc. and 24 of its subsidiaries each filed a
voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Tex. Lead Case No. 16-32488) on May 16, 2016. The petitions
were signed by Julian M. Bott as chief financial officer.
The Debtors have hired Kirkland & Ellis LLP as general bankruptcy
counsel, Zack A. Clement PLLC as local counsel, Houlihan Lokey
Capital, Inc. as financial advisor, Alvarez & Marsal Holdings, LLC
as restructuring advisor and Prime Clerk LLC as claims and
noticing agent.
The cases are assigned to Judge David R Jones.
The Office of the U.S. Trustee has appointed five creditors of
SandRidge Energy, Inc., to serve on the official committee of
unsecured creditors. The Official Committee is represented by:
Charles R. Gibbs, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
1700 Pacific Avenue, Suite 4100
Dallas, TX 75201
Tel: (214) 969-2800
Fax: (214) 969-4343
- and -
Daniel H. Golden, Esq.
Abid Qureshi, Esq.
Brad M. Kahn, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
One Bryant Park
New York, NY 10036
Telephone: (212) 872-1000
Facsimile: (212) 872-1002
An Ad Hoc Committee of Shareholders is represented by:
Susan C. Mathews, Esq.
Lori Ann Hood, Esq.
BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ
A Professional Corporation
1301 McKinney St., Suite 3700
Houston, TX 77010
Tel: (713) 650-9700
Fax: (713) 650-9701
- and -
Sunil "Neil" Gupta, Esq.
BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ
A Professional Corporation
160 Northridge Dr.
Daly City, CA 94015
Tel: (408) 603-4779
Counsel to the First Lien Credit Agreement Agent:
Andrew V. Tenzer, Esq.
Leslie A. Plaskon, Esq.
Michael Comerford, Esq.
PAUL HASTINGS LLP
200 Park Avenue
New York, NY 10166
Counsel to the Ad Hoc Group of Consenting Unsecured Creditors:
Joseph H. Smolinsky, Esq.
Daniel N. Griffiths, Esq.
WEIL GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, NY 10153
Counsel to the Ad Hoc Group of Consenting Second Lien Creditors:
Damian S. Schaible, Esq.
Eli V. Vonnegut, Esq.
DAVIS POLK & WARDWELL, LLP
450 Lexington Avenue
New York, NY 10017
SANDRIDGE ENERGY: Plans to Issue $300,000,000 in Notes Due 2020
---------------------------------------------------------------
SandRidge Energy, Inc. filed with the Securities and Exchange
Commission a FORM T-3/A (Amendment No. 1) FOR APPLICATIONS FOR
QUALIFICATION OF INDENTURES UNDER THE TRUST INDENTURE ACT OF 1939,
in relation to the Company's plan to issue $300,000,000 in 0.00%
Convertible Senior Subordinated Notes Due 2020.
The amount may be decreased in accordance with and pursuant to the
terms of a Plan of Reorganization and a Confirmation Order,
A copy of the Form T-3/A (Amendment No. 1) is available at
https://is.gd/WcqMVx
A copy of the Form T-1 is available at https://is.gd/bdDqms
A copy of the Indenture with Wilmington Trust is available at
https://is.gd/j9MEUq
SandRidge is represented by:
Matthew R. Pacey
Kirkland & Ellis LLP
600 Travis Street, Suite 3300
Houston, TX 77002
Tel: (713) 835-3600
About SandRidge Energy, Inc.
SandRidge Energy, Inc. (OTC PINK: SDOC) --
http://www.sandridgeenergy.com/-- is an oil and natural gas
exploration and production company headquartered in Oklahoma City,
Oklahoma, with its principal focus on developing high-return,
growth-oriented projects in the U.S. Mid-Continent and Niobrara
Shale.
SandRidge Energy, Inc. and 24 of its subsidiaries each filed a
voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Tex. Lead Case No. 16-32488) on May 16, 2016. The petitions
were signed by Julian M. Bott as chief financial officer.
The Debtors have hired Kirkland & Ellis LLP as general bankruptcy
counsel, Zack A. Clement PLLC as local counsel, Houlihan Lokey
Capital, Inc. as financial advisor, Alvarez & Marsal Holdings, LLC
as restructuring advisor and Prime Clerk LLC as claims and noticing
agent.
The cases are assigned to Judge David R Jones.
The Office of the U.S. Trustee has appointed five creditors of
SandRidge Energy, Inc., to serve on the official committee of
unsecured creditors. The Official Committee is represented by
Charles R. Gibbs, Esq., Daniel H. Golden, Esq., Abid Qureshi, Esq.,
and Brad M. Kahn, Esq., at Akin Gump Strauss Hauer & Feld LLP.
An Ad Hoc Committee of Shareholders is represented by Susan C.
Mathews, Esq., Lori Ann Hood, Esq., and Sunil "Neil" Gupta, Esq.,
at Baker, Donelson, Bearman, Caldwell & Berkowitz.
Counsel to the First Lien Credit Agreement Agent are Andrew V.
Tenzer, Esq., Leslie A. Plaskon, Esq., and Michael Comerford, Esq.,
at Paul Hastings LLP.
Counsel to the Ad Hoc Group of Consenting Unsecured Creditors are
Joseph H. Smolinsky, Esq., and Daniel N. Griffiths, Esq., at Weil
Gotshal & Manges LLP.
Counsel to the Ad Hoc Group of Consenting Second Lien Creditors are
Damian S. Schaible, Esq., and Eli V. Vonnegut, Esq., at Davis Polk
& Wardwell, LLP.
SATURN CORP: Court Approves Amended Disclosure Statement
--------------------------------------------------------
Judge Thomas J. Catliota of the U.S. Bankruptcy Court for the
District of Maryland entered an order approving the Amended
Disclosure Statement in support of Saturn Corporation's Amended
Plan of Reorganization, which proposes pro rata share for allowed
general unsecured claims from Class 4 Assets.
The Disclosure Statement identifies the sources of proceeds to fund
the Plan:
(a) The New Equity Purchase Price, which consists of the net
proceeds of the sale of the Yosts' House used to satisfy the
Allowed Secured Claims of Wyvill after payment of any
broker/agent fees and commissions, and the senior
lienholders. The Yosts' House is encumbered by the following
liens: (i) 1st lien – SunTrust (approximately $298,818);
(ii) 2nd and 3rd liens – Wyvill ($962,257 in total); (iii)
4th lien – Vision Financial (approximately $45,171.50); and
(iv) 5th lien - Bank of America ($241,332).
Fielding Yost is president to the Company. Wyvill is secured
lender to the Debtor.
(b) The Reorganized Debtor shall make the payments to Classes 1,
2 (Other Secured), 3 (Priority Non-Tax) and 4 (General
Unsecured) Claims pursuant to the Plan from cash on hand,
and future revenues of the Reorganized Debtor.
(c) The holders of Allowed Class 4 Claims shall share Pro Rata
in the net recoveries from Avoidance Actions.
With the Court's recent ruling, the Debtor is now authorized to
solicit acceptances for the Plan.
Written objections to the Plan may be filed so as to be received by
the Clerk of the Court no later than Oct. 24, 2016.
The hearing on the confirmation of the Plan will be held on Nov. 7,
2016, at 10:00 a.m. Eastern Time, in Maryland.
A full-text copy of the Amended Disclosure Statement dated Sept.
15, 2016, and the Disclosure Statement Order, is available at:
http://bankrupt.com/misc/mdb16-12421-121.pdf
The Debtor is represented by:
COLE SCHOTZ P.C.
Gary H. Leibowitz (Bar No. 24717)
Jonathan A. Grasso (Bar No. 19278)
300 East Lombard Street, Suite 1450
Baltimore, MD 21202
Tel: (410) 230-0660
E-mail: gleibowitz@coleschotz.com
jgrasso@coleschotz.com
About Saturn Corporation
Saturn Corporation filed a Chapter 11 petition (Bankr. D. Md. Case
No. 16-12421) on February 28, 2016. The petition was signed by
Fielding W. Yost, president. The Debtor was founded in 1981 in
Maryland to provide data management services to non-profit and
membership organizations. The Debtor listed $1 million to $10
million in assets and liabilities at the Petition Date.
Gary Cole Schotz P.C., serves as counsel to the Debtor.
SCT TRANSPORTATION: Disclosure Statement Hearing Set for Nov. 8
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Mississippi
is set to hold a hearing on November 8, at 1:30 p.m., to consider
approval of the disclosure statement explaining the Chapter 11 plan
of reorganization of SCT Transportation Inc.
The hearing will take place at the U.S. Courthouse, Courtroom 4D,
501 East Court Street, Jackson, Mississippi. Objections are due by
October 26.
About SCT Transportation Inc.
SCT Transportation, Inc. filed a chapter 11 petition (Bankr. S.D.
Miss. Case No. 16-00989) on March 21, 2016. The petition was
signed by Ronnie H. Vanderford, director/president.
The Debtor is represented by J. Walter Newman, IV, Esq., at Newman
& Newman. The case is assigned to Judge Edward Ellington.
The Debtor estimated assets and liabilities at $0 to $50,000 at the
time of the filing.
SESAC HOLDCO II: S&P Revises Outlook to Neg. & Affirms 'B' CCR
--------------------------------------------------------------
S&P Global Ratings said that it revised its rating outlook on
Nashville, Tenn.-based SESAC Holdco II LLC to negative from stable
and affirmed its 'B' corporate credit rating on the company.
At the same time, S&P affirmed its 'B+' issue-level rating on the
company's first-lien term loan due 2019. The '2' recovery rating
is unchanged, indicating S&P's expectation for substantial recovery
(70-90%; upper half of the range) of principal for the debtholders
in the event of a payment default.
Additionally, S&P affirm its 'CCC+' issue-level rating on the
company's second-lien term loan due 2016. The '6' recovery rating
is unchanged, indicating S&P's expectation for negligible recovery
(0%-10%) of principal for the debtholders in the event of a payment
default.
"The outlook revision reflects the uncertainty regarding the
upcoming arbitration on SESAC's TV and radio licenses, as well as
potential regulatory changes from the U.S. Department of Justice's
interpretation of the antitrust consent decrees," said S&P Global
Ratings' credit analyst Khaled Lahlo. "These may have a material
impact on the company's profitability and free cash flow generation
(although the ruling was challenged recently by a federal judge,
which tempers risks)."
The negative rating outlook reflects the potential that S&P may
downgrade SESAC during the next 12 months if regulatory and
arbitration changes have a material impact on the company's
profitability and free cash flow generation.
S&P could lower its corporate credit rating on SESAC if regulatory
and arbitration changes have a material impact on the company's
profitability and free cash flow generation and if the company's
leverage doesn't go below 6.5x over the next few quarters, or if
S&P sees EBITDA margins declining to the low-20% area.
S&P could revise the outlook to stable if it believes the
regulatory and arbitration changes will not materially impact the
company's profitability and free cash flow generation.
SEVENTY SEVEN: Moody's Assigns Caa1 CFR, Outlook Stable
-------------------------------------------------------
Moody's Investors Service assigned new ratings to Seventy Seven
Operating LLC (SSO), an operating subsidiary of Seventy Seven
Energy, Inc. (SSE), including a Caa1 Corporate Family Rating, a
Caa1-PD Probability of Default Rating (PDR), and Caa1 ratings to
its senior secured term loan due 2020 and incremental senior
secured term loan due 2021. These rating assignments follow the
company's emergence from Chapter 11 bankruptcy proceedings. The
rating outlook is stable.
In June 2016, SSE filed a pre-packaged plan of reorganization under
Chapter 11 of the US Bankruptcy Code to effect a financial
restructuring, which included SSO. The pre-packaged plan provided
for approximately $1.1 billion of the company's outstanding senior
notes to be converted to all of SSE's post-bankruptcy common equity
and the maintenance of the company's existing $392 million senior
secured term loan and its existing $84 million incremental senior
secured term loan. "SSO's recapitalization and extinguishment of
$1.1 billion of existing debt significantly improves its leverage
and near term liquidity," said Moody's Vice President, John
Thieroff. "SSO's restructured balance sheet better positions the
company to survive the current deep, prolonged downturn in demand
for oilfield services."
Assignments:
Issuer: Seventy Seven Operating LLC
Corporate Family Rating of Caa1
Probability of Default Rating of Caa1-PD
Senior Secured Term Loan due 2020, Rated Caa1 (LGD5)
Senior Secured Incremental Term Loan due 2021, Rated Caa1 (LGD5)
Outlook: Stable
RATINGS RATIONALE
SSO's Caa1 CFR reflects the company's exposure to the highly
cyclical oil and natural gas land drilling and hydraulic fracturing
activities, high revenue concentration with Chesapeake Energy
Corporation (Caa2, positive), and a moderately leveraged capital
structure following the recent restructuring of the company's
parent, SSE. The rating is supported by contracts on its fleet of
land drilling rigs and pressure pumping spreads that provide a
measure of revenue visibility in 2017, however margins will likely
remain weak as contracts priced well-above current market rates
roll off through 2017 in an oversupplied market leading to
additional pricing erosion -- evidenced by the large number of
idled rigs the company has that are under contract. Additional
support to the rating is provided by the company's broad geographic
footprint in the onshore US and good service line diversification,
relative to similarly rated peers.
Moody's views SSO's liquidity as adequate through 2017, supported
primarily by cash on the balance sheet following completion of the
company's restructuring and an undrawn $100 ABL revolving credit
facility. The ABL facility is governed by a springing fixed charge
covenant that is activated when availability drops to less than
12.5% of the borrowing base. Required coverage is 1.0x, which the
company should be able to comfortably meet although utilization is
not expected to reach a point that the covenant would become
activated through 2017. The senior secured term loan matures in
2020, there are no other maturities prior to that.
SSO is the obligor under the revolving credit facility (not rated),
senior secured term loan due 2020 and the incremental senior
secured term loan due 2021. SSE and all of its other material
subsidiaries guarantee the revolver and the term loans. The
revolver is secured by a first lien on all of the company's
accounts receivable, inventory and other current assets as defined
in the agreement. The term loan is secured by a first lien on all
of the company's drilling rigs, oilfield services equipment and
other long-term tangible assets. The first priority position of
the revolver results in the term loans being rated Caa1, the same
rating as the CFR under Moody's Loss Given Default Methodology.
The stable outlook reflects the prospect for gradual improvement in
rig utilization and pressure pumping through 2017. Ratings could
be upgraded if SSO's debt to EBITDA appears sustainable below 4.0x,
after giving effect to the run-off of 2014 vintage contracts, while
maintaining adequate liquidity and the company is able to reduce
its Chesapeake cash flow concentration. The ratings could be
downgraded if EBITDA/interest coverage falls below 2.0x or
liquidity deteriorates below $50 million.
The principal methodology used in these ratings was Global Oilfield
Services Industry Rating Methodology published in December 2014.
Seventy Seven Operating LLC (SSO) is the primary operating
subsidiary of Seventy Seven Energy Inc. (SSE), a privately held
oilfield services company based in Oklahoma City, OK. SSE, through
SSO and its subsidiary companies owns and operates drilling rigs,
pressure pumping equipment and other oilfield services assets and
operates primarily in the Midcontinent and the Permian,
Haynesville, Eagle Ford and Appalachian basins.
SH 130 CONCESSION: Wants Plan Filing Period Moved to Nov. 30
------------------------------------------------------------
SH 130 Concession Company, LLC and certain of its affiliates ask
the U.S. Bankruptcy Court for the Western District of Texas to
extend their exclusive periods for filing a chapter 11 plan and
soliciting acceptances, through and including, November 30, 2016
and January 15, 2017, respectively.
According to the Debtors, they have filed the Plan and Disclosure
Statement and have been negotiating in good faith with the Senior
Lenders and other parties in interest, including the TIFIA Lender,
the Texas Department of Transportation, and the Debtors' sponsors
to address remaining open issues therein.
The Debtors seek this extension in order to capitalize on the
success of those negotiations and solicit acceptances of the Plan
in the most efficient and cost-effective manner possible without
the distraction of a competing plan process or the cost and delay
associated therewith.
If the Debtors' request for an extension of the Exclusive Periods
were denied, any party in interest would be free to propose a
chapter 11 plan for the Debtors. The Debtors said they should be
not be distracted by the risks inherent in a "free-for-all" plan
process that could result in substantial litigation and increased
administrative cost, depleting estate resources.
About SH 130 Concession
Headquartered in Buda, Texas, SH 130 Concession Company, LLC (the
"Concessionaire") was formed to finance, develop, design,
construct, operate, and maintain segments five and six of Texas
State Highway 130 in partnership with the Texas Department of
Transportation.
The Concessionaire, Zachry Toll Road - 56 LP and Cintra TX 56 LLC
filed Chapter 11 bankruptcy petitions (Bankr. W.D. Tex. Case Nos.
16-10262, 16-10263 and 16-10264, respectively) on March 2, 2016.
The petitions were signed by Alfonso Orol as chief executive
officer. The Debtors estimated both assets and debts in the range
of $1 billion to $10 billion.
Toll Road - 56 and TX 56 are holding companies that collectively
hold the equity interests in the Concessionaire. They have no
operations and have no creditors.
The Debtors have engaged Gibson, Dunn & Crutcher LLP as general
counsel, Jackson Walker L.L.P. as local counsel, and Prime Clerk
LLC as notice, claims, solicitation, balloting and tabulation
agent.
Judge Tony M. Davis has been assigned the case.
SIMMONS FOODS: S&P Raises CCR to 'B'; Outlook Stable
----------------------------------------------------
S&P Global Ratings raised its corporate credit rating on Siloam
Springs, Ark.-based Simmons Foods Inc. to 'B' from 'B-'. The
outlook is stable.
At the same time S&P raised its issue level ratings on the
company's $415 million second-lien notes maturing 2021 to 'B' from
'CCC+', with a revised recovery rating of '4', reflecting S&P's
expectations for average recovery (at the upper end of the 30% to
50% range) in the event of a payment default.
"The upgrade reflects improved credit measures on better operating
performance from the company's poultry and pet segments," said S&P
Global Ratings credit analyst Jessica Paige. "Poultry pricing and
volume growth is improving as the export market bounces back from
the 2015 avian flu outbreak, while the pet food segment has put
plant upgrade costs and equipment relocation delays behind them."
The stable outlook reflects S&P Global Ratings' belief that the
company will improve operating performance in 2016, while improving
and sustaining a debt-to-EBITDA ratio below 4.0x in the next 12
months. S&P believes low-single-digit consolidated sales and
volume growth together with muted feed costs in the poultry segment
and better capacity utilization in the pet food segment will allow
the company to modestly improve its EBITDA margins to over 8% and
sustain these improved credit measures.
SOUTHERN SEASON: Selling Assets at NC Stores to Calvert for $30K
----------------------------------------------------------------
Southern Season, Inc., asks the U.S. Bankruptcy Court for the
Middle District of North Carolina to authorize the private sale of
tangible assets, except for inventory, located at the Debtor's
stores in Raleigh, North Carolina and Asheville, North Carolina,
and all tangible assets, including inventory, located at the
Debtor's store in Charleston, South Carolina ("Supplemental Sale
Assets") to Calvert Retail, L.P., for $30,000.
On Aug. 21, 2016, the Court entered its Order (I) Approving the
Asset Purchase Agreement between the Debtor and Calvert Retail,
L.P., (II) Authorizing the Sale of Certain of the Debtor's Assets
Free and Clear of Liens, Claims, Interests and Encumbrances, (III)
Authorizing the Assumption and Assignment of a Certain Lease and
(IV) Granting Related Relief ("Sale Order").
On Aug. 22, 2016, the Debtor and Calvert Retail, L.P., closed the
sale of substantially all of the Debtor's assets pursuant to the
Sale Order and that certain Asset Purchase Agreement between
Calvert and the Debtor dated Aug. 17, 2016 ("APA"). The transfer
of the Sale Assets occurred at 12:01 a.m. Eastern time on Aug. 23,
2016, under Section 4.1 of the APA.
A copy of the APA attached to the Motion is available for free at:
http://bankrupt.com/misc/Southern_Season_313_Sales.pdf
Under the Sale Order and the APA, the Debtor retained ownership of,
and did not sell, certain Excluded Assets which are Supplemental
Sale Assets.
As set forth in the APA, the Debtor has agreed to sell the
Supplemental Sale Assets to Calvert for $30,000, subject to the
approval of the Court.
The Supplemental Sale Assets are subject to the secured claim of
SummitBridge National Investments IV, LLC. However, the
Supplemental Sale Assets constitute Carve-Out Assets under decretal
paragraph 29 of the Sale Order, to be used and distributed as more
particularly set forth therein. Therefore, the Debtor is authorized
to sell the Supplemental Sale Assets free and clear of any and all
liens, encumbrances or other interests pursuant to 11 U.S.C.
Section 363(f).
In order to avoid the significant continuing administrative expense
costs associated with storing the Supplemental Sale Assets in
certain of the Debtor's leased premises, the Debtor has permitted
Calvert to remove and take possession of the Supplemental Sale
Assets in advance of the consummation of the transactions
contemplated in the APA.
The Debtor consulted with the Committee and Iron Horse Auctioneers
to determine whether the highest and best value for the
Supplemental Sale Assets would be obtained through private sale or
through including the Supplemental Sale Assets. Iron Horse
Auctioneers indicated that the purchase price agreed to with
Calvert was higher than they would expect to receive if the
Supplemental Sale Assets were sold at public auction.
The Debtor, the Committee and SummitBridge support the sale of the
Supplemental Sale Assets to Calvert, and believe the sale is in the
best interests of the Debtor's bankruptcy estate.
The Debtor requests authority to close the sale under the APA, and
will turn over the sale proceeds to counsel for the Committee, to
be used and distributed pursuant to the terms of decretal paragraph
29 in the Sale Order.
About Southern Season
Southern Season, Inc., was founded in 1975 and is a premier retail
destination for specialty food and gifts. It currently operates
its flagship retail store located in Chapel Hill, North Carolina,
and its three "Taste of Southern Season" stores in Asheville,
Raleigh, North Carolina and Charleston, South Carolina.
Southern Season sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D.N.C. Case No. 16-80558) on June 24,
2016. The petition was signed by Clay Hammer, CEO.
On Aug. 8, 2016, John Fioretti of ABTV was appointed as the
Debtor's Chief Restructuring Officer. The CRO has the full and
complete authority to manage the affairs of the Debtor.
The Debtor is represented by John Paul H. Cournoyer, Esq., at
Northen Blue, LLP, and Richard M. Hutson, II, Esq., at Hutson Law
Offices, P.A. The case is assigned to Judge Benjamin A. Kahn.
At the time of the filing, the Debtor disclosed $9.82 million in
assets and $18.3 million in liabilities.
ST. JUDE NURSING: Taps Senior Living Investment as Broker
---------------------------------------------------------
St. Jude Nursing Center, Inc. received approval from the U.S.
Bankruptcy Court for the Eastern District of Michigan to hire
Senior Living Investment Brokerage, Inc.
The Debtor tapped the brokerage firm to market and sell its assets
as a "going concern," according to court filings.
Senior Living will charge the Debtor a fee for its services equal
to 3% of the sale price. The fee will be paid solely from the
proceeds of the sale.
Tom Rusthoven, a senior associate at Senior Living, disclosed in a
court filing that the firm is a "disinterested person" as defined
in section 101(14) of the Bankruptcy Code.
Senior Living can be reached through:
Tom Rusthoven
Senior Living Investment Brokerage, Inc.
490 Pennsylvania Avenue
Glen Ellyn, IL 60137
Phone: (630) 858-2501
Fax: (630) 858-2551
Email: rusthoven@slibinc.com
The Debtor is represented by:
Michael E. Baum, Esq.
Kim K. Hillary, Esq.
Schafer and Weiner, PLLC
40950 Woodward Avenue, Suite 100
Bloomfield Hills, MI 48304
Tel: (248) 540-3340
Email: khillary@schaferandweiner.com
About St. Jude Nursing
St. Jude Nursing Center, Inc., filed for Chapter 11 bankruptcy
protection (Bankr. E.D. Mich. Case No. 16-42116) on Feb. 18, 2016.
Hon. Thomas J. Tucker presides over the cases.
The Debtor is a privately owned and licensed long-term skilled
nursing facility located at 34350 Ann Arbor Trail, Livonia,
Michigan 48150. It consists of 64 licensed beds, located within
the Debtor-owned facility. The current census ranges between 55
and 56 residents. The majority of the residents are long term.
The Debtor continues to employ nearly 84 full and part-time
employees. The Debtor's facility continues to offer services such
as skilled nursing care, hospice care, Alzheimer's and dementia
patient care, physical rehabilitation, tracheal and enteral
services, wound care, and short-term respite care.
STELLAR BIOTECHNOLOGIES: Mark McPartland Quits as VP Corp. Dev't
----------------------------------------------------------------
Mark McPartland, vice president of corporate development and
communications of Stellar Biotechnologies, Inc., notified the
Company that he will resign from his position effective Sept. 29,
2016. Mr. McPartland is resigning to pursue a new business
opportunity. His decision was not due to any disagreement with the
Company on any matter relating to the Company's operations,
policies or practices, as disclosed in a Form 8-K report filed with
the Securities and Exchange Commission.
About Stellar
Port Hueneme, Cal.-based Stellar Biotechnologies, Inc.'s
business is to commercially produce and market Keyhole Limpet
Hemocyanin ("KLH") as well as to develop new technology related to
culture and production of KLH and subunit KLH ("suKLH")
formulations. The Company markets KLH and suKLH formulations to
customers in the United States and Europe.
KLH is used extensively as a carrier protein in the production of
antibodies for research, biotechnology and therapeutic
applications.
Stellar Biotechnologies reported a net loss of $8.43 million for
the year ended Aug. 31, 2014, a net loss of $14.5 million for the
year ended Aug. 31, 2013, and a net loss of $5.52 million for the
year ended Aug. 31, 2012. Stellar Biotechnologies reported a net
loss of $2.84 million on $758,689 of revenues for the year ended
Sept. 30, 2015.
As of June 30, 2016, Stellar had $8.50 million in total assets,
$839,002 in total liabilities, all current, and $7.66 million in
total shareholders' equity.
STONEWALL GAS: Moody's Places B2 CFR Under Review for Upgrade
-------------------------------------------------------------
Moody's Investors Service placed the ratings of Stonewall Gas
Gathering, LLC ("Stonewall") under review for upgrade including its
B2 Corporate Family Rating (CFR), B2-PD Probability of Default
Rating (PDR), and B2 senior secured term loan rating.
This action follows the announcement on September 26, 2016 that DTE
Energy Company (A3, on review for downgrade), a Michigan-based
utility and energy company, was purchasing 55% of Stonewall from M3
Midstream and Vega Energy Partners. The deal is expected to close
in the fourth quarter 2016, subject to HSR review.
"The ratings review for upgrade reflects our view that Stonewall's
ratings will benefit from the new ownership stake from DTE, an
investment grade company with an expanding midstream footprint and
greater financial resources," said Moody's Assistant Vice
President, Morris Borenstein. "The Stonewall gas gathering system
are ideally located for gathering gas from the Southwest Marcellus
and delivering it to multiple interstate pipelines and markets."
Ratings placed under review for upgrade:
Stonewall Gas Gathering, LLC.
-- Corporate Family Rating at B2;
-- Probability of Default Rating at B2-PD;
-- Senior Secured Bank Loan at B2 (LGD3).
RATINGS RATIONALE
DTE is acquiring M3 Midstream and Vega Energy Partners' entire 40%
and 15% ownership stake in Stonewall, respectively. Upon close, WGL
Midstream (a subsidiary of WGL Holdings, Inc., A3 stable) will
still own 30% of Stonewall and Antero Resources Corporation (Ba2
negative) will own the remaining 15%. Antero has the ability to
sell its 15% to DTE. Moody's rating review will focus on the impact
of DTE's ownership stake in Stonewall, including future operating
plans, financial policies and potential changes to its existing
capital structure. Moody's review will also consider the strategic
importance of the Stonewall ownership investment to DTE and the
other owner's to determine the likelihood of support, which could
provide one or two notches of ratings uplift. However, absent a
guarantee of the debt, Stonewall's ratings are likely to remain
below investment grade.
Stonewall's existing B2 CFR is supported by its low leverage and
MVC contracts from its anchor shipper Antero and other customers
including Mountaineer Keystone (unrated). Moody's expects further
deleveraging through 2016 through earnings growth. Stonewall's
ratings are also supported by its status as a southern outlet to
interstate pipelines and markets for natural gas produced in the
southwest portion of the Marcellus Shale play, which has take-away
capacity constraints. Stonewall's ratings are constrained by the
single-asset nature of the pipeline, small scale, and concentration
in Antero and MK, which are both supply-push customers with
commodity price risk exposure.
The principal methodology used in these ratings was Global
Midstream Energy published in December 2010.
Stonewall Gas Gathering, LLC is a project company with a 67-mile
pipeline system gathering natural gas from central delivery points
in the south-west portion of the Marcellus Shale play in West
Virginia since December 1, 2015. The system has the capacity to
move 1.4 Bcf/d of natural gas with the ability to expand to 2.0
Bcf/d with additional compression.
STONEWALL GAS: S&P Puts 'B' CCR on CreditWatch Positive
-------------------------------------------------------
S&P Global Ratings said it placed its 'B' corporate credit rating
on Stonewall Gas Gathering LLC on CreditWatch with positive
implications. S&P also placed its 'BB-' issue-level rating on
Stonewall's senior secured term loan B on CreditWatch positive.
The CreditWatch placement reflects DTE Energy's announcement that
it plans to acquire a 55% ownership interest in Stonewall Gas
Gathering. DTE Energy plans to acquire 40% from M3 Midstream and
15% from Vega Energy Partners. It will also purchase 100% of the
interconnected Appalachia Gathering System located in the Southwest
Marcellus/Utica shale basin. The total purchase price is
approximately $1.3 billion, and S&P expects the purchase to be
completed in October.
While S&P does not expect any changes to the capital structure, it
believes its ratings on Stonewall will benefit from implicit
support from DTE Energy under S&P's group ratings methodology
criteria.
Stonewall is a gas-gathering pipeline system located in the
southwestern part of the Marcellus shale basin. Pro forma for the
transaction, WGL Midstream will own 30% and Antero Midstream 15%.
"During the CreditWatch period, we will determine Stonewall Gas
Gathering's level of strategic importance to DTE Energy," said S&P
Global Ratings credit analyst Mike Llanos. "We will resolve the
CreditWatch placement upon the completion of the merger once we've
had an opportunity to assess the impacts of the change in
ownership."
SUBMARINA INC: Franchisees Try To Block Court OK on Disclosures
---------------------------------------------------------------
Franchisees SD Subbros, Inc., Subbros, Inc., EDRC LLC, J&C Mason
Inc., JTJM Inc., J & J Subs Inc., Masquerade Sub Corp., J TW Area
Developers Inc., Vonnie Audibert, Paul Simmons, Eddie Alcantar,
EricDannenberg, and Joe Mason filed with the U.S. Bankruptcy Court
for the District of Nevada an objection to Submarina, Inc.'s first
amended disclosure statement to the Debtor's plan of
reorganization.
As reported by the Troubled Company Reporter on Aug. 11, 2016, the
Debtor filed a Chapter 11 plan of reorganization that proposes to
pay general unsecured claims in full. According to the First
Amended Disclosure Statement dated July 26, 2016, the Plan proposes
that Class 6 non-insider general unsecured creditors will be paid
in full, without interest, from the judgments collected from
franchisees, or will receive equal monthly installments of all
amounts collected from the judgments for a period of 120 months.
The Franchisees claim that, among others:
a. the Disclosure Statement doesn't contain adequate
information. Kerensa Investment Fund LLC, the jointly
administered debtor, didn't file a disclosure statement
and plan and what was filed cannot be considered a
disclosure statement and plan for Kerensa Debtor. The
Debtor does reference Kerensa Investment Fund 1 LLC and
seems to refer to this entity as being the same as the
Kerensa Debtor. The Debtor doesn't provide information
about the Kerensa Debtor's assets and why the Kerensa
Debtor will lose its stock listed as having a value of $3
million;
b. the Disclosure Statement doesn't provide an adequate
description of the Debtor's assets and present condition
of the Debtor in Chapter 11;
c. the Debtor doesn't provide information on the anticipated
future of the Debtor and collection of judgments the
Debtor asserts it will obtain;
d. the Debtor fails to reveal the sources of the information
provided in the disclosure document; and
e. the Debtor admits that no one should rely on its monthly
operating reports and sets forth its alleged revenues and
royalties and M&P that it asserts have been withheld.
A copy of the Objection is available at:
https://is.gd/s89ZEU
The Franchisees are represented by:
Jeanette E. McPherson, Esq.
Schwartzer & McPherson Law Firm
2850 South Jones Boulevard, Suite 1
Las Vegas, Nevada 89146-5308
Tel: (702) 228-7590
Fax: (702) 892-0122
E-mail: bkfilings@s-mlaw.com
About Submarina Inc.
Submarina, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Nev. Case No. 12-22097) on Oct. 25,
2012. The petition was signed by Bruce N. Rosenthal, president and
CEO.
The Debtor is represented by Matthew L. Johnson, Esq., and Russell
G. Gubler, Esq., at Johnson & Gubler, P.C.
The case is assigned to Judge Mike K. Nakagawa.
At the time of the filing, the Debtor estimated its assets and
debts at $1,000,001 to $10,000,000.
SUN PROPERTY: Has Until November 16 to File Chapter 11 Plan
-----------------------------------------------------------
Judge Louis A. Scarcella of the U.S. Bankruptcy Court for the
Eastern District of New York extended the exclusive periods during
which only Sun Property Consultants, Inc. may file a chapter 11
plan and solicit acceptance of the plan, extending the time to
November 16, 2016, and January 13, 2017, respectively.
As earlier reported by the Troubled Company Reporter, the Debtor
sought the Court's authority to extend for 120 days the exclusive
periods during which only the Debtor may file a chapter 11 plan and
solicit acceptance of such plan, extending the time to Jan. 18,
2017, and March 20, 2017, respectively.
The Debtor tells that since the filing of its petition, the Debtor
and his professionals have been addressing numerous issues of
critical importance to the Debtor's estate, including working to
stabilize the Debtor's business and restructure its financial
operations and investigate claims against the Debtor's creditors.
The Debtor adds that although it has made progress addressing
various issues, the Debtor needs additional time to investigate its
basis to challenge the first mortgage held by SunCorp Investors LLC
and determine if there are affirmative claims against others.
About Sun Property Consultants
Sun Property Consultants, Ltd., sought protection under Chapter 11
of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 16-72267) on May
23, 2016. The petition was signed by Rajesh K. Singh, authorized
representative. The Debtor is represented by Marc A. Pergament,
Esq., at Weinberg, Gross & Pergament LLP. The case is assigned to
Judge Louis A. Scarcella. At the time of the filing, the Debtor
estimated its assets at $10 million to $50 million and debt at $1
million to $10 million.
SUNEDISON INC: Sale of Interests in Minnesota Projects Approved
---------------------------------------------------------------
Judge Stuart M. Bernstein of the U.S. Bankruptcy Court for the
Southern District of New York authorized SunE MN Development, LLC,
to sell and transfer 100% of the outstanding membership interests
("Equity Interests") in those Minnesota project companies ("Project
Companies") to SoCore MN Acquisition, LLC, for $79,804,159.
The Equity Interests will be transferred free and clear of all
liens, claims, liabilities, and encumbrances.
SunEdison, LLC, has 22 commercial and industrial segment projects
under development in Minnesota. These projects include 15
self-developed projects and 7 additional projects that have been
co-developed with Ecoplexus, Inc. ("Ecoplexus") under the terms of
a prior agreement ("Ecoplexus PSA"). The Minnesota projects will
provide 136 MW of power upon reaching their commercial operation
dates and are located in a cold weather state with a project
construction season dictated by the freeze and thaw cycles at
project sites.
SunEdison is authorized to enter into the Ecoplexus Settlement
Agreement which resolves certain claims related to a Ecoplexus PSA,
dated Sept. 30, 2015, by and between Ecoplexus and SunEdison, and
to take any and all actions necessary to implement the terms of the
Settlement Agreement without further order of the Court, in each
case consistent with applicable non-bankruptcy law. For the
avoidance of doubt, upon effectiveness of the mutual release
Section 7 of the Ecoplexus Settlement Agreement, Ecoplexus will not
have and will not file a claim against any Sun Edison or its
affiliates in the Chapter 11 Cases for any of the claims released
pursuant thereto. Any settlement or compromise contained within
the PSA or the Ecoplexus Settlement, including any releases by the
Debtors, are approved under Section 363(b) of the Bankruptcy Code
and Bankruptcy Rule 9019.
Any authorization contained in the Order and any proceeds obtained
by the Seller pursuant to the Transactions will be subject to any
applicable requirements imposed on the Debtors under the Final
Order (I) Authorizing Debtors to (A) Obtain Senior Secured,
Superpriority, Postpetition Financing Pursuant to Sections 105,
361, 362, 364(c)(1), 364(c)(2), 364(c)(3), 364(d)(1), and 364(e)
and (B) Utilize Cash Collateral Pursuant to Section 363, and (ii)
Granting Adequate Protection to Prepetition Secured Parties
Pursuant to Sections 361, 362, 363 and 364 and the other DIP Loan
Documents.
The requirements set forth in Bankruptcy Rules 6003(b) and 6004
have been satisfied or otherwise deemed waived.
About SunEdison, Inc.
SunEdison, Inc. (OTC PINK: SUNEQ), is a developer and seller of
photovoltaic energy solutions, an owner and operator of clean power
generation assets, and a global leader in the development,
manufacture and sale of silicon wafers to the semiconductor
industry.
On April 21, 2016, SunEdison, Inc., and 25 of its affiliates each
filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case Nos.
16-10991 to 16-11017). Martin H. Truong, the senior vice
president, general counsel and secretary, signed the petitions.
The Debtors disclosed total assets of $20.7 billion and total debt
of $16.1 billion as of Sept. 30, 2015.
The Debtors have hired Skadden, Arps, Slate, Meagher & Flom LLP as
counsel, Togut, Segal & Segal LLP as conflicts counsel, Rothschild
Inc. as investment banker and financial advisor, McKinsey Recovery
& Transformation Services U.S., LLC, as restructuring advisors and
Prime Clerk LLC as claims and noticing agent. The Debtors employed
PricewaterhouseCoopers LLP as financial advisors; and KPMG LLP as
their auditor and tax consultant.
An official committee of unsecured creditors has been appointed in
the case. The committee tapped Weil, Gotshal & Manges LLP as its
general bankruptcy counsel and Morrison & Foerster LLP as special
counsel.
SUNRISE LOGISTIC: Taps Steven A. Schwaber as Legal Counsel
----------------------------------------------------------
Sunrise Logistic Group, Inc. seeks approval from the U.S.
Bankruptcy Court for the Central District of California to hire
legal counsel in connection with its Chapter 11 case.
The Debtor proposes to hire the Law Offices of Steven A. Schwaber
to provide these legal services:
(a) advising the Debtor regarding its rights and duties
under the Bankruptcy Code;
(b) advising the Debtor regarding all documents required by
the Office of the U.S. Trustee;
(c) representing the Debtor at meetings and hearings as the
Office of the U.S. Trustee may require;
(d) taking actions to obtain court approval of any proposed
transactions by the Debtor that are not in the ordinary
course of its business;
(e) representing the Debtor with respect to contested
matters;
(f) prosecuting or defending third-party adversary
proceedings;
(g) conducting strategic planning and analysis;
(h) assisting the Debtor in the investigation of its acts,
conduct, assets, liabilities and financial condition, and
other matters relevant to the case; and
(i) assisting the Debtor in strategic planning and analysis
and participating in the formulation of a plan of
reorganization.
Steven Schwaber, Esq., will be paid $450 per hour for his services.
Mr. Schwaber will, to the extent not precluded by actual conflicts
of interest, utilize Mark Markus, Esq., as a part-time or contract
attorney. Mr. Markus' billing rate is also $450 per hour.
In a court filing, Mr. Schwaber disclosed that he is
"disinterested" as defined in section 101(14) of the Bankruptcy
Code.
Mr. Schwaber's contact information is:
Steven A. Schwaber, Esq.
Law Offices of Steven A. Schwaber
2600 Mission Street, Suite 100
San Marino, California 91108
Tel: (626) 403-5600
Email: steve@schwaberlaw.com
About Sunrise Logistic Group
Sunrise Logistic Group, Inc. sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. C. D. Calif. Case No. 16-20178) on July
31, 2016. The petition was signed by Tom Zhang, CEO/President.
The case is assigned to Judge Sheri Bluebond.
At the time of the filing, the Debtor estimated assets of less than
$100,000 and liabilities of $1 million to $10 million.
SWEET BRIAR: S&P Raises Rating on 2006 Refunding Bonds to 'B'
-------------------------------------------------------------
S&P Global Ratings raised its rating on Amherst Industrial
Development Authority, Va.'s series 2006 educational facilities
revenue refunding bonds, issued for Sweet Briar College, to 'B'
from 'CCC'. The outlook is stable.
"We raised the rating based in part on our Not-for-Profit Public
and Private Colleges and Universities methodology and our view of
the current leadership's efforts to restore sustainability after
previous announcements of closure," said S&P Global Ratings credit
analyst Sussan Corson.
Sweet Briar College has a new management team and board in place
since July 2016 that is still in the process of formulating its
management structure and policies and the college expects to hire a
new president to succeed the current one who will retire next
summer 2017. The college expects to update its long-term strategic
plan with the arrival of the new president.
The 'B' rating reflects what S&P views as this weakness for Sweet
Briar College:
-- Drastic reduction in enrollment and retention basis due to
disruptions last year;
-- Volatility in operations that are at risk of negative future
performance on a generally accepted accounting principles
basis;
-- Recent complete turnover of all management and the governing
board with leadership still in the process of recuperating
stability after transition; and
-- Continued weakness in selectivity and matriculation rates
reflecting vulnerability in the college's demand profile.
The rating also reflects what S&P views as these for the college:
-- Sufficient available resources, with fiscal 2015 expendable
resources of approximately $46 million representing 81% of
operations; and
-- Low maximum annual debt service burden equal to 3.6% of
operating expenses.
An unconditional general obligation pledge of the college secures
all debt.
The stable outlook reflects S&P's view of the college's sufficient
available resources to meet liquidity ratio covenants in its direct
purchase agreements and expectation that operations should continue
to stabilize, particularly with demonstrated support by fundraising
and commitment of the new management team and board.
S&P could consider a higher rating during the one-year outlook
period if Sweet Briar College demonstrates continued stabilization
of enrollment, stable available resources, and controlled endowment
spending, while improving financial operations as it establishes
its long-term strategy and management continuity.
S&P could consider a negative rating action in the next one year if
the college's available resources and liquidity were to deteriorate
significantly or if endowment spending increased significantly.
Furthermore, renewed concerns about the ability of the college to
meet its bond covenants or significant declines in enrollment could
create negative pressure on the rating.
Sweet Briar College is a private women's liberal arts and sciences
college in the community of Sweet Briar, 50 miles south of
Charlottesville.
T C & PAM: Plan Outline Okayed, Confirmation Hearing on Nov. 3
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Mississippi
will consider approval of the Chapter 11 plan of T C & Pam Cummings
STL Ministries at a hearing on November 3.
The hearing will be held at 9:30 a.m., at the Oxford Federal
Building, 911 Jackson Avenue, Oxford, Missouri.
The court will also consider at the hearing the final approval of T
C & Pam's disclosure statement, which it conditionally approved on
September 20.
The order set an October 21 deadline for creditors to cast their
votes and file their objections.
T C & Pam is represented by:
Robert Gambrell, Esq.
Gambrell & Associates, PLLC
101 Ricky D. Britt Boulevard, Suite 3
Oxford, MS 38655
Tel: (662) 281-8800
Fax: (662) 202-1004
Email: rg@ms-bankruptcy.com
About T C & Pam Cummings
T C & Pam Cummings STL Ministries filed Chapter 11 petition (Bankr.
N.D. Miss. Case No. 15-14241) on Nov. 27, 2015, and is represented
by Robert Gambrell, Esq., at Gambrell & Associates, PLLC.
T-REX OIL: Announces Spin-Off of Subsidiary NexFuels, Inc.
----------------------------------------------------------
T-Rex Oil, Inc. incorporated NexFuels, Inc., a wholly-owned
subsidiary in the State of Colorado on July 11, 2016. NexFuels was
created in order to develop the Company's Carbon Dioxide Recovery
Project.
The Company's Carbon Dioxide Recovery Project is focused on the
development of exhaust stack supplies of carbon dioxide for use in
enhanced oil recovery. The project involves the development, build
out and operation of a commercial scale carbon capture systems on
existing coal fueled electric power plants in the United States,
specifically in Wyoming. Once the carbon dioxide has been
captured, purified and condensed it can be sold and deliver the CO2
to oil producers in the surrounding areas through a company owned
and operated CO2 pipeline. The Company intended to develop the
program in concert with its oil production activities in the Powder
River Basin of Wyoming.
In April 2016, the Company entered into a Confidentiality Agreement
and a Memorandum of Understanding with Rocky Mountain Power, a
division of PacifiCorp, which is owned by Berkshire Hathaway
Energy. The Memorandum provides both parties the opportunity for a
period of 18 months to explore the feasibility of a Carbon Dioxide
Capture Facility, exclusively.
On Sept. 12, 2016, the Company announced that it had received the
first part of the Feasibility Analysis being prepared by Sargent &
Lundy, LLC regarding the future operation of a carbon capture
system to be used to generate a CO2 stream in conjunction with
enhanced oil recovery pursuant to the MOU. Phase 1 which was a
Regulatory and Permitting Study had been completed and it was
determined that the permitting and regulatory approvals were
feasible. The next phase, the technical feasibility and economic
studies, has commenced and it is expected to be completed in
October 2016.
As work on the project has developed, the Company's Board of
Directors began to explore opportunities for the financing and
development of the Project, including the development of the carbon
dioxide recovery project in a separate company able to develop the
project and able to obtain necessary financing without the further
dilution of the shareholders of the Company. The financing of the
two segments is very different. The Project will require large
amounts of financing that are accessed from capital markets that
include debt financing and equity financing.
The Board of Directors saw the value in the Project, however, it
was determined that in order to raise sufficient funds to implement
its commercialization, the Company would need to raise substantial
amounts of money, which would dilute current shareholder interests
in T-Rex. Therefore, to focus and better implement these
strategies, the Board of Directors approved the spin-off of
NexFuels.
The Company's Board of Directors has determined that spinning-off
of NexFuels and the carbon dioxide recovery project will accomplish
a number of important objectives. The spin-off will separate
distinct lines of business with different financial, investment and
operating characteristics so that each can adopt business
strategies and objectives tailored to their respective markets.
This will allow NexFuels and the carbon dioxide recovery project,
which have operations that are distinct from the Company's oil
exploration and production operations to better focus and
prioritize the allocation of both companies' management and
implement their financial resources for achievement of their
corporate objectives.
The Spin-Off
Record shareholders of T-Rex, as of the Record Date of Aug. 19,
2016, will receive one shares of NexFuels common stock for every
two shares (2) of T-Rex common stock owned. The stock dividend
will be based upon 17,009,628 shares of T-Rex common stock that are
issued and outstanding as of the Record Date.
Record shareholders of T-Rex will not automatically receive a paper
certificate for shares of common stock. Only after NexFuels is
registered with the SEC as a reporting company, can the NexFuels
transfer agent create an account for each T-Rex stockholder. On
the effective date of the distribution, the transfer agent will
credit the restricted shares issued to each registered stockholder
to their respective accounts with the transfer agent.
NexFuels Board of Directors
As part of the spin-off of NexFuels, the Company's chief executive
officer and Chairman, Mr. Donald Walford was appointed to the Board
of Directors of NexFuels, as was the Mr. Herbert Sears, who is also
a member of the T-Rex Board of Directors. Mr. Thomas Sweeney was
also appointed to the Board of Directors.
Description of Assets Held by NexFuels, Inc.
On Aug. 19, 2016, the Company assigned to NexFuels, Inc. the
following assets:
1. The idea, concept and plan to capture and sell CO2 generated
by the Dave Johnston power plant located in Converse County,
Wyoming and/or any other power plants owned by PacifiCorp.
2. The MOU by and between T-Rex and PacifiCorp Energy the
owner/operator of the power plant.
3. The existing contract by and between Sargent Lundy LLC to
perform the feasibility study.
4. Any and all other valid and subsisting contracts, agreement,
and instruments, rights or other interest that the Company
may have in the Project.
5. All valid and subsisting easements, permits, licenses,
servitudes, rights of way and other surface rights that
directly relate to or are otherwise directly applicable to
the Project.
At the time of the assignment of the Project, the Company had
incurred costs in connection with its development. These costs
were related primarily to management's time and travel and payment
to Sargent Lundy LLC for Phase 1 of the feasibility study. None of
these costs were accounted for as assets or capitalized.
The spin-off of NexFuels is not expected to have an impact upon
T-Rex's balance sheet, since the Project had no tangible or
intangible assets, which had been capitalized and the financial
statements of NexFuels on a stand-alone basis would therefore not
meet the 10% significance test of Instruction 4(ii) Item 2.01 of
Form 8-K and 11-01(b)(2) of Regulation S-X, as such financial
information has not been provided.
About T-Rex
T-Rex Oil, Inc., fka Rancher Energy Corp., is an energy company,
focused on the acquisition, exploration, development and production
of oil and natural gas.
B F Borgers CPA PC, in Denver, Colo., the Company's independent
registered public accounting firm, which audited the Company's
financial statements as of March 31, 2015, and for each of the
years in the two-year period then ended, raised substantial doubt
about the Company's ability to continue as a going concern in a
July 14, 2015 letter to the Company's board of directors and
stockholders. The letter was filed with the Securities and
Exchange Commission together with the Company's revised Annual
Report on Form 10-K delivered to the Commission in December.
B F Borgers said the Company's significant operating losses raise
substantial doubt about its ability to continue as a going
concern.
As of June 30, 2016, T-Rex had $3.27 million in total assets, $3.13
million in total liabilities and $58,891 in stockholders' equity.
TAYLOR-WHARTON: Court Extends Solicitation Period Through Oct. 28
-----------------------------------------------------------------
Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware extended the exclusive Plan solicitation
period of Taylor-Wharton International LLC and Taylor-Wharton
Cryogenics LLC through and including October 28, 2016.
As earlier reported by the Troubled Company Reporter, the Debtors
asked the Court to further extend their exclusive solicitation
period to provide the Debtors with an opportunity to seek
confirmation of their Plan without the unnecessary expense and
complication that would result from the tactical filing of any
competing plan for any third-party plan would unnecessarily detract
from the Debtors' orderly liquidation efforts to the detriment of
all stakeholders.
About Taylor-Wharton
Taylor-Wharton International LLC and Taylor-Wharton Cryogenics LLC
filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Proposed Lead
Case No. 15-12075) on Oct. 7, 2015. The petition was signed by
Thomas Doherty as chief restructuring officer.
Cryogenics is a leading designer, engineer and manufacturer of
cryogenic equipment designed to transport and store liquefied
atmospheric and hydrocarbon gases. Cryogenics has a single United
States operation in Theodore, Alabama. Cryogenics is the direct or
indirect parent of several foreign non-debtor subsidiaries which
have manufacturing operations in China, Malaysia, Slovakia, and
warehousing operations in Germany and Australia.
The Debtors have engaged Reed Smith LLP as general bankruptcy
counsel, Nixon Peabody LLP as special counsel, Argus Management
Corporation as interim management services provider, Stifel,
Nicolaus & Company, Incorporated and Miller Buckfire & Company LLC
as investment banker and Logan & Company, Inc., as noticing and
claims agent. Argus Management Corporation is authorized to
provide interim management services, and designate Thomas Doherty
as chief restructuring officer.
Taylor-Wharton International LLC disclosed total assets of
$14,463,438 and total liabilities of $47,978,923. O'Neal Steel
Inc. is listed as the largest unsecured creditor holding a trade
claim of $788,815.
Judge Brendan Linehan Shannon is assigned to the case.
The Office of the U.S. Trustee appointed the Committee pursuant to
Section 1102(a)(1) of the Bankruptcy Code. The Committee is
comprised of three members: (a) Pension Benefit Guaranty
Corporation, (b) O'Neal Steel, Inc., and (c) Harsco Corporation. On
the same day, the Committee selected Lowenstein Sandler LLP and The
Rosner Law Group LLC to serve as its co-counsel and EisnerAmper LLP
to serve as its financial advisor in the Chapter 11 Cases.
TIAT CORPORATION: Unsecureds May Be Paid From Stock Sale Proceeds
-----------------------------------------------------------------
Tiat Corporation filed with the U.S. Bankruptcy Court for the
District of Kansas a first amended Chapter 11 disclosure statement
dated Sept. 12, 2016, in connection with the Debtor's first amended
Chapter 11 plan.
It is anticipated that there may be payment on the Class 6 General
Unsecured Claims from the proceeds of the auction of the stock in
the Reorganized Debtor, after full payment of allowed
administrative priority claims, and Class 3, 4, and 5 priority tax
claims.
Creditor claims will be paid by the Reorganized Debtor from income
generated by ongoing operations and the sale of the stock in the
Reorganized Debtor.
As reported by the Troubled Company Reporter on Aug. 8, 2016, the
Debtor filed with a Chapter 11 plan that would set aside $168,000
to pay unsecured creditors. That plan proposed to pay Class 6
unsecured creditors a total of $168,000 at the rate of $2,000 per
month for seven years.
The First Amended Disclosure Statement is available at:
http://bankrupt.com/misc/ksb16-10764-108.pdf
About TIAT Corporation
TIAT Corporation dba The Inn at Tallgrass --
http://www.theinnattallgrass.com/-- is a corporation that operates
an 88-room hotel in located in Wichita, Kansas, called The Inn at
Tallgrass.
The hotel owner filed a Chapter 11 petition (Bank. D. Kan. Case
No. 16-10764) on April 29, 2016, and is represented by Mark J.
Lazzo, Esq., in Wichita. At the time of the filing, the Debtor
disclosed $2.25 million in assets and debts totaling $6.46 million.
TIM'S TRUCKING: Plan Outline Ok'd, Confirmation Hearing on Oct. 24
------------------------------------------------------------------
Tim's Trucking, Inc., is now a step closer to emerging from Chapter
11 protection after a bankruptcy judge conditionally approved the
outline of its plan of reorganization.
Judge Thomas Saladino of the U.S. Bankruptcy Court for the District
of Nebraska on September 20 gave the thumbs-up to the disclosure
statement, allowing the company to start soliciting votes from
creditors.
The order set an October 20 deadline for creditors to cast their
votes and file their objections.
If objections are filed, the hearing on final approval of the
disclosure statement and on confirmation of the plan will be held
on October 24, at 9:00 a.m., at the Robert V. Denney Courthouse,
460 Federal Building, 100 Centennial Mall North, Lincoln,
Nebraska.
If no objection to confirmation is served, the court will deem the
pleading unopposed and will consider confirmation without a
hearing.
Tim's Trucking. on September 15 filed its proposed restructuring
plan, under which the principals of the company will contribute a
sum equal to 10% of all allowed Class 3A unsecured claims, on a pro
rata basis and with no interest, amortized over five years in equal
annual payments. Payments will begin one year after confirmation.
Daniel Dugan, son of the officers of Tim's Trucking, will seek
financing to purchase all assets of the company, and the company
will be liquidated, according to the disclosure statement
explaining the plan.
A copy of the disclosure statement is available for free at
https://is.gd/4rITK3
Tim's Trucking is represented by:
John C. Hahn, Esq.
Wolfe, Snowden, Hurd, Luers & AHL, LLP
Wells Fargo Center
1248 "O" Street, Suite 800
Lincoln, NE 68508
Tel: (402) 474-1507
Fax: (402) 474-3170
Email: jhahn@wolfesnowden.com
About Tim's Trucking Inc.
Tim's Trucking, Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Neb. Case No. 16-40206) on February 17,
2016. The petition was signed by Raymond T. Dugan, president.
At the time of the filing, the Debtor estimated assets and
liabilities of less than $500,000.
TITHERINGTON DESIGN: Proposes CRG Auction of Assets on Nov. 15
--------------------------------------------------------------
Titherington Design & Manufacturing, Inc., asks the U.S. Bankruptcy
Court for the Northern District of New York to authorize and
schedule a public auction sale of the assets to be conducted by
Capital Recovery Group, LLC ("CRG"), including the sale and bid
procedures.
On June 1, 2016, the Court entered an order approving the Cash
Collateral Stipulation. Pursuant to that stipulation the Debtor
was obligated to obtain an offer for the sale of certain of the
Debtor's assets, or otherwise retain an auctioneer to effect the
sale of the Assets. Pursuant to the Machining Equipment Sale Order
the Court entered on Sept. 12, 2016, CRG purchased the Debtor's
machining equipment for the sum of $107,500.
Subsequent to that sale process, the Debtor's principal determined
that proceeding with the liquidation of the remaining assets,
consisting largely of plastic molding equipment ("Assets"), and
winding up the business was in the best interests of the Debtor,
its estate and creditors. Accordingly, the Debtor has retained CRG
to conduct an auction of the remaining assets. The remaining
assets are subject to the perfected security interest of NBT Bank
("NBT"). NBT has filed a claim in the amount of $1,904,831, secured
by a lien on all, or substantially all, of the Debtor's assets.
NBT has consented to the sale process, and has further agreed to a
carve-out from the sale proceeds in the amount of $30,000 for the
estate ("Carve-Out").
Pursuant to the terms of its retention application, CRG proposes to
provide a multi-tiered marketing and advertising campaign with
respect to the Assets to be sold. CRG's employees have over 50
years' experience in the valuation and/or disposition of industrial
assets. It proposes to perform a comprehensive audit of the
Debtor's equipment to create a catalog of the assets to be sold.
It also proposes to provide liability insurance and require that
its sub-contractors do the same, and that proof of such coverage is
provided. CRG will also supervise the removal of equipment sold as
well as any surplus equipment and leave the Debtor's facility in a
neat and orderly fashion.
To ensure that maximum value is obtained in connection with the
sale of the Assets, the Debtor is requesting that the Court enter
the Auction Sale Order so as to provide for, among other things,
advertising of the sale as determined by CRG in the exercise of its
business judgment and the scheduling of an auction sale at a date
and time determined by CRG in its discretion, but in no event on a
date later than Nov. 15, 2016 ("Auction Sale"). The schedule will
afford CRG sufficient time to inspect, catalog and advertise the
sale to prospective purchasers.
In order to facilitate an orderly sale of the assets, CRG has
prepared bidding procedures to be employed in the Auction Sale and
terms and conditions of the sale of the Assets to the successful
bidder.
A copy of the proposed bidding procedures and terms and conditions
of the Auction Sale ("Terms and Conditions") attached to the Motion
is available for free at:
http://bankrupt.com/misc/Titherington_Design_111_Sales.pdf
The salient provisions of the Terms and Conditions are:
a. CRG will conduct the Auction Sale not later than Nov. 15,
2016. The sale will be conducted at the Debtor's business address
at 102 Sharron Avenue, Plattsburgh, New York After the Auction
Sale, the Debtor will determine which bid is the highest and best
bid for the Assets.
b. The Assets are being sold "as is, where is," without recourse
to, representation by, or warranties by, the Seller of any kind or
description whatsoever, either express or implied, and without
contingencies of any kind.
c. Sales of the Assets will be free and clear of all liens and
encumbrances, with such liens and encumbrances attaching to the
proceeds of sale to the same extent and priority as such liens had
prior to the sale of the Assets.
d. CRG will have discretion to set bidding increments, and to
arrange for remote bidding in the form of telephone or internet
bidding, provided such bidders have qualified to participate in the
auction in accordance with CRG's policies and procedures.
e. CRG may offer the Assets in lots as it seems appropriate in
its experience and in the exercise of its business judgment.
f. Successful bidders will pay their respective bid amounts,
plus a 15% buyer's premium to CRG immediately following the
conclusion of the Auction Sale.
g. Pursuant to Section 363(k), any lienholder may credit bid at
the Auction Sale for so much of the Assets as subject to their
respective lien and up to the allowed amount of their secured
claim.
h. The Court will conduct a hearing on Nov. 16, 2016 at 10:30
a.m. to consider entering an Order approving the sales of the
Assets to the successful bidders. The sales of the Assets are
subject to approval by the Bankruptcy Court at the hearing ("Sale
Confirmation Hearing").
i. The successful bidder will pay the bid price plus the buyer's
premium immediately at the conclusion of the Auction Sale.
j. In the event of a default by any successful bidder, at the
sole option of the Debtor, the initial successful bidder's bid will
be deemed forfeited or withdrawn, and the Debtor will be authorized
to arrange for the sale of the particular item or items of Assets
to the second highest bidder for such properties without any
further notice. Except as expressly agreed by the Debtor, the
Terms and Conditions will govern in the event of a sale to the
second highest bidder.
Following submission of the auctioneer's report as provided for in
Local Rule 6005-1, the Debtor will file a motion for entry of an
order approving the auctioneer's report, allowing reimbursement of
the auctioneer's expenses and allowing disbursement of such fees,
payment of the Carve-Out to Nolan & Heller, LLP, and turnover of
the balance of the sale proceeds to NBT Bank on account of its
security interest in the Assets.
Time is of the essence with respect to the moving the sale process
to completion. Any order approving the sale in accordance with the
Terms and Conditions should be effective immediately upon entry of
such order by providing that the 10-day stay period provided under
both Bankruptcy Rules 6004 will not apply.
About Titherington Design
Titherington Design & Manufacturing, Inc., sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. N.D.N.Y. Case No.
16-10705) on April 21, 2016.
The petition was signed by Philip D. Titherington, president and
CEO. The Debtor is represented by Francis J. Brennan, Esq., at
Nolan & Heller, LLP.
The Debtor estimated assets of $500,000 to $1 million and debts of
$1 million to $10 million.
TLC HEALTH: Still Focuses on Patients' Needs, 16th PCO Report Says
-------------------------------------------------------------------
Linda Scharf, RN, DNS, the Patient Care Ombudsman for TLC Health
Care Network, has filed a Sixteenth Report for the period July 15,
2016 to September 15, 2016.
During the visits conducted on the facilities, the PCO found no
findings of decline in medical care. Though a complaint was
received from a subacute patient, the Nursing Home Unit, the
Director of Nursing assured that she would follow through.
As a summary of the Report, the PCO mentioned that the facility
continues to concentrate on the needs of its patients. Patients'
reports showed their satisfaction with the care provided by the
facility, and with the availability of supplies, medications and
staff when needed.
The PCO may be contacted through:
Linda Scharf, RN, DNS
6766 Tonawanda Creek Road
Lockport, NY 14094
Telephone (716) 433 0121
Email: lms676@roadrunner.com
About TLC Health Network
TLC Health Network filed a Chapter 11 petition (Bankr. W.D.N.Y.
Case No. 13-13294) on Dec. 16, 2013. The petition was signed by
Timothy Cooper as Chairman of the Board. The Debtor estimated
assets of at least $10 million and debt of at least $1 million.
Jeffrey A. Dove, Esq., at Menter, Rudin & Trivelpiece, P.C.,
serves
as the Debtor's counsel. Damon & Morey LLP is the Debtor's
special
health care law and corporate counsel. The Bonadio Group is the
Debtor's accountants. Howard P. Schultz & Associates, LLC is the
Debtor's appraiser.
The case is assigned to the Hon. Carl L. Bucki.
A three-member panel composed of Cannon Design, Chautauqua
Opportunities, Inc., and Jamestown Rehab Services has been
appointed as the official unsecured creditors committee. Bond,
Schoeneck & King, PLLC is the counsel to the Committee. The
Committee has tapped NextPoint LLC as financial advisor.
TOM GJURAJ: Files Second Amended Disclosure Statement
-----------------------------------------------------
Tom Gjuraj filed with the U.S. Bankruptcy Court for the District of
Connecticut his second amended disclosure statement dated September
14, 2016, a full-text copy of which is available at
https://is.gd/htRsGm
The Debtor proposes to pay the unsecured creditors holding allowed
non priority claims their pro rata share of the sum of $650 payable
each quarter over 6 years for a total of $15,600.
The Debtor believes that the filed and scheduled non-priority
unsecured allowed Claims total approximately $155,317.
The Debtor intends to primarily use his income, rental income and
income from his company as necessary to further the payments under
the Plan.
His assets relating to real estate include a multifamily property
located at 66 Lockwood Stamford CT, a residence located at 37
Hillwood Place, Norwalk, CT and his interest in Gjuraj Holdings,
LLC, which owns a multifamily property located at 46 Saint Mathias
Street, Bridgeport CT.
The Debtor sets October 26, 2016 as the Claims Objections
Deadline.
About Tom Gjuraj
Tom Gjuraj filed a Chapter 11 petition (Bankr. D. Conn. Case No.
15-51297) on September 14, 2015, and is represented by Matthew K.
Beatman, Esq., at Zeisler & Zeisler, P.C., in Bridgeport,
Connecticut.
TOYS R US: Negotiates $88-Mil. Mezzanine Deal for Propco II
-----------------------------------------------------------
Rick Green, writing for Bloomberg Brief, reported that Toys "R" Us
Inc. received a tentative offer for an $88 million financing deal
that requires the toy retailer to raise as much as $512 million in
the commercial mortgage-backed securities market.
According to the report, citing a regulatory filing, the nonbinding
letter of intent covers a five-year mezzanine facility for the Toys
"R" Us Property Company II unit. Negotiations for a definitive
agreement are in progress, the report said, citing the company.
Propco II owns fee and ground leasehold interests in 123 U.S.
properties covering 5 million square feet, Toys "R" Us said, the
report related. For the 12 months ended July 30, the Propco II
stores operated by the Toys-Delaware subsidiary generated revenue
of $958 million and operating earnings of $113 million, the report
further related, citing the filing.
* * *
The Troubled Company Reporter, on Aug. 26, 2016, reported that
Moody's Investors Service upgraded Toys "R" Us, Inc.'s Probability
of Default Rating (PDR) to B3-PD from Caa3-PD, and appended the PDR
with the "/LD" (limited default) designation. The outlook is
unchanged at stable.
The Troubled Company Reporter, on June 20, 2016, reported that
Fitch Ratings has affirmed the Issuer Default Rating (IDRs) for
Toys 'R' Us, Inc. (Toys, or the Holdco), Toys 'R' Us - Delaware,
Inc., Toys 'R' Us Property Co. II, LLC, and Toys 'R' Us Property
Co. I, LLC, post the company's announcement of plans to refinance
up to 83% of the $850 million of Holdco notes due in 2017 and
2018.
S&P Global Ratings affirmed its ratings on Toys "R" Us Inc.
including the 'B-' corporate credit rating. The outlook is
stable.
Moody's Investors Service stated that if the exchange offer
announced by Toys "R" Us, Inc. on June 14, 2016 proceeds as
outlined, it will constitute a distressed exchange, which is an
event of default under Moody's definition of default. As a result,
the Probability of Default rating is downgraded to Caa3-PD from
B3-PD.
"We view Toys' proposed exchange as opportunistic and driven by a
confluence of factors, and believe it enhances liquidity as it
takes two meaningful maturities off the table for the next five
years," stated Moody's Vice President Charlie O'Shea. "The
company's B3 corporate family rating is unaffected, and it is our
expectation that if this exchange closes as outlined in the 8K
filed yesterday, the PDR will return to the B3-PD rating level
shortly thereafter."
TRIANGLE USA: Gibson, Young Conaway Represent Ad Hoc Noteholders
----------------------------------------------------------------
Gibson, Dunn & Crutcher LLP and Young Conaway Stargatt & Taylor,
LLP, in connection with the Chapter 11 cases of Triangle USA
Petroleum Corporation, et al., submitted on Sept. 27, 2016, a
supplemental verified statement pursuant to Rule 2019 of the
Federal Rules of Bankruptcy Procedure.
On July 25, 2016, Gibson Dunn and Young Conaway filed a verified
statement pursuant to Federal Rule of Bankruptcy Procedure 2019,
wherein they disclosed their representation of Chambers Energy
Capital, Eaton Vance Management, Franklin Advisers, Inc., J.P.
Morgan Securities LLC (with respect to only its Credit Trading
group), Prudential Financial, Inc., Shenkman Capital Management,
Inc. (on behalf of certain advisory accounts in its capacity as
Investment Manager), and Southeastern Asset Management, Inc., in
these Chapter 11 cases.
On Sept. 13, 2016, Gibson Dunn and Young Conaway filed the First
Supplemental Verified Statement pursuant to Federal Rule of
Bankruptcy Procedure 2019. In the First Supplemental Verified
Statement, Gibson Dunn and Young Conaway disclosed that they no
longer represent Franklin Advisers, Inc., in these Chapter 11
cases.
In accordance with Bankruptcy Rule 2019, Gibson Dunn and Young
Conaway has supplemented that First Verified Statement and the
First Supplemental Verified Statement to disclose that it no longer
represents Prudential Financial, Inc., in these Chapter 11 cases.
The names and addresses of, and the nature and amount of all
disclosable economic interests held by, certain holders of the
Debtors' 6.75% Senior Notes due 2022 in relation to the Debtors as
of the date hereof, which reflects the removal of Prudential
Financial, Inc., include:
a. Chambers Energy Capital
600 Travis Street, Suite 4700
Houston, TX 77702
Principal Amount 6.75% Senior Notes due 2022: $9 million
b. Eaton Vance Management
Two International Place
Boston, MA 02110
Principal Amount 6.75% Senior Notes due 2022: $11 million
c. J.P. Morgan Securities LLC, with respect to only its Credit
Trading group
383 Madison Avenue, Level 3
New York, NY 10179
Principal Amount 6.75% Senior Notes due 2022: $31.688 million
d. Shenkman Capital Management, Inc.
on behalf of certain advisory accounts in its capacity as
Investment Manager
461 Fifth Avenue, 22nd Floor
New York, NY 10017
Principal Amount 6.75% Senior Notes due 2022: $19.875 million
e. Southeastern Asset Management, Inc.
6410 Poplar Avenue, Suite 900
Memphis, TN 38119
Principal Amount 6.75% Senior Notes due 2022: $225.792
million
Gibson Dunn and Young Conaway make no representation regarding the
amount, allowance, or priority of such claims, and reserves all
rights with respect thereto. Gibson Dunn and Young Conaway also
hold no disclosable economic interests in relation to the Debtors.
Neither the filing of this Second Supplemental Verified Statement
nor any subsequent appearance, pleading, claim, or suit is intended
or will be deemed to waive: (i) the right to have orders in
non-core matters entered only after de novo review by a district
court; (ii) the right to trial by jury in any proceeding so triable
in any case, controversy or adversary proceeding; or (iii) the
right to have the reference withdrawn in any matter subject to
mandatory or discretionary withdrawal of the Ad Hoc Noteholders.
In addition, all other rights, claims, actions, defenses, setoffs,
or recoupments to which the Ad Hoc Noteholders are or may be
entitled under agreements, in law, or in equity, all of which
rights, claims, actions, defenses, setoffs, and recoupments are
expressly reserved, and nothing contained in this Second
Supplemental Verified Statement should be construed as a limitation
upon, or waiver of, any of the Ad Hoc Noteholders' rights to
assert, file and amend their claims or statements of interests in
accordance with applicable law and any orders entered in these
Chapter 11 cases.
The counsel for the Ad Hoc Noteholders can be reached at:
Sean M. Beach, Esq.
Andrew L. Magaziner, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
E-mail: sbeach@ycst.com
amagaziner@ycst.com
-- and --
Matthew J. Williams, Esq.
Shira D. Weiner, Esq.
GIBSON, DUNN & CRUTCHER LLP
200 Park Avenue
New York, New York 10166-0193
Tel: (212) 351-4000
Fax: (212) 351-4035
E-mail: mjwilliams@gibsondunn.com
sweiner@gibsondunn.com
About Triangle USA
Triangle USA Petroleum Corporation is an independent exploration
and production company with a strategic focus on developing the
Bakken Shale and Three Forks formations in the Williston Basin of
North Dakota and Montana. TUSA is a wholly owned subsidiary of
Triangle Petroleum Corporation (NYSE MKT: TPLM). Neither TPLM nor
its affiliated company, RockPile Energy Services, LLC, is included
in TUSA's Chapter 11 filing.
Triangle USA Petroleum Corporation and its affiliates filed
voluntary petitions under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Lead Case No. 16-11566) on June 29, 2016. The
cases are pending before the Honorable Mary F. Walrath.
The Debtors have engaged Skadden, Arps, Slate, Meagher & Flom LLP
as counsel, AP Services, LLC, as financial advisor, PJT Partners
Inc. as investment banker and Prime Clerk LLC as claims & noticing
agent.
In its petition, TUSA estimated assets in the range of $500
million to $1 billion and liabilities of up to $1 billion.
TRINITY CONSTRUCTION: Disclosures Ok'd, Plan Hearing on Oct. 19
---------------------------------------------------------------
Trinity Construction of Virginia, LLC, is now a step closer to
emerging from Chapter 11 protection after a bankruptcy judge
conditionally approved the outline of its plan of reorganization.
Judge Rebecca Connelly of the U.S. Bankruptcy Court for the Western
District of Virginia on September 20 gave the thumbs-up to the
disclosure statement after finding that it contains "adequate
information."
The order set an October 12 deadline for creditors to cast their
votes and file their objections.
A court hearing to consider confirmation of the plan is scheduled
for October 19, at 11:00 a.m. The hearing will take place at the
U.S. Courthouse, Courtroom, 116 N. Main Street, Harrisonburg,
Virginia.
Trinity Construction is represented by:
Hannah W. Hutman, Esq.
Beth C Driver, Esq.
Hoover Penrod, PLC
342 South Main Street
Harrisonburg, VA 22801
Phone: 540-433-2444
Email: hhutman@hooverpenrod.com
bdriver@hooverpenrod.com
About Trinity Construction of Virginia
Trinity Construction of Virginia, LLC sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Va. Case No.
16-50281) on March 24, 2016. The petition was signed by Monica
Waugh, authorized agent.
The case is assigned to Judge Rebecca B. Connelly.
At the time of the filing, the Debtor estimated assets of less than
$100,000 and liabilities of less than $1 million.
TROLLEY ROCK: Wants Plan Filing Period Extended to Nov. 15
----------------------------------------------------------
Trolley Rock Truck Stop, LLC asks the U.S. Bankruptcy Court for the
Eastern District of Tennessee to extend the exclusivity period for
filing a plan in a small business case from September 30, 2016 to
November 15, 2016.
About Trolley Rock Truck Stop, LLC.
Trolley Rock Truck Stop, LLC filed a chapter 11 petition (Bankr.
E.D. Tenn. Case No. 16-11355) on April 4, 2016. The petition was
signed by Floyd Don Davis, owner. The Debtor is represented by
Robert S. Peters, Esq., at Swafford, Peters, Priest & Hall. The
case is assigned to Judge Shelley D. Rucker. The Debtor disclosed
total assets at $1.43 million and total liabilities at $859,266.
TWEDDLE GROUP: Moody's Assigns B2 Corporate Family Rating
---------------------------------------------------------
Moody's Investors Service assigned Tweddle Group, Inc. ("Tweddle")
a B2 Corporate Family rating ("CFR"), a B2-PD Probability of
Default rating ("PDR") and a B2 to the proposed senior secured
first lien term loan due 2023. The rating outlook is stable.
The net proceeds of the new debt issuance will be used to refinance
Tweddle's existing term loan and fund an approximately $100 million
distribution to Tweddle's shareholders, including affiliates of the
controlling financial sponsor, the Gores Group.
Issuer: Tweddle Group, Inc.
Assignments:
-- Corporate Family Rating, Assigned B2
-- Probability of Default Rating, Assigned B2-PD
-- Senior Secured First Lien Term Loan due 2023, Assigned B2
(LGD3)
Outlook:
-- Outlook, Stable
RATINGS RATIONALE
The B2 CFR reflects Tweddle's small revenue scale, narrow product
scope, significant customer concentration and moderately high
financial leverage. Tweddle's top three North American automotive
original equipment manufacturer ("OEM") customers comprised about
80% of its 2015 revenues. Moody's expects revenues of less than
$200 million annually, which is small for the B2 rating category.
Free cash flow will be only about $5 million, pressured by expected
earn out payments associated with the 2014 acquisition of the
majority of Tweddle's equity from the founding family by affiliates
of Gores Group. However, solid profitability, debt to EBITDA
expected to be around 4.5 times and EBITA to interest expense of
over 3 times provide rating support. That said, debt to EBITDA
would be over 5 times if anticipated earn-out payments due in 2017
and 2018 were added to debt. Also supporting the rating is
Tweddle's entrenched business position and long standing history
with its top customers, as well as 3 to 5 year contracts that
ensure revenue growth as the complexity of the driver and repair
manuals it produces grow with the complexity of the underlying
vehicles. In addition, the National Highway Traffic Safety
Administration's ("NHTSA") legal mandate requiring OEMs to have an
owner's manual present in a vehicle before it can be sold (new or
used) ensures solid demand for Tweddle's service offerings. Moody's
views Tweddle's long standing history with its top customers as a
key competitive barrier, giving the company the technical
experience and vast data libraries needed to provide value to its
customers as the complexity of and electronic content in new
vehicles continues to increase.
Moody's considers Tweddle's liquidity to be adequate, supported by
expectations of annual free cash flow of at least $5 million and a
fully available and undrawn $20 million ABL revolver (unrated) due
2021. Earn-out payments to the company's founding family will
likely consume cash and weaken liquidity in 2017 and 2018.
All financial metrics cited reflect Moody's standard adjustments.
The B2 rating on the term loan reflects both the PDR of B2-PD and
the loss given default assessment of LGD3, reflecting the term
loan's second priority lien on the company's most liquid assets,
which are pledged on a first priority basis to the ABL revolver,
and the term loan's priority over all other obligations.
The stable rating outlook reflects Moody's expectations for 5%
revenue growth, free cash flow of at least $5 million, and that
Tweddle will not lose any business with major customers. The
outlook incorporates Moody's anticipation of further debt-financed
shareholder distributions.
The ratings could be upgraded if 1) revenue scale is increased
while customer and geographic concentrations are reduced, 2) free
cash flow to debt is sustained at around 8% or better and 3)
financial policies remain balanced between creditors and
shareholders.
The ratings could be downgraded if 1) debt to EBITDA remains above
5.5 times, 2) free cash flow to debt is sustained below 2%, 3)
Tweddle loses or experiences a significant volume loss at any major
customer or 4) liquidity deteriorates.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in December 2014.
Tweddle, Group, Inc. based in Clinton Township, Michigan, develops
and authors user and service manuals, as well as other technical
and data driven content, to automotive OEMs, primarily in North
America.
UFS HOLDINGS: S&P Affirms 'B' CCR, Outlook Stable
-------------------------------------------------
S&P Global Ratings said that it affirmed its 'B' corporate credit
rating on UFS Holdings Inc. The rating outlook is stable.
At the same time, S&P affirmed its 'B+' issue-level rating (one
notch above the corporate credit rating) on the company's upsized
first-lien secured credit facilities. The '2' recovery rating is
unchanged, indicating S&P's expectation for substantial (70%-90%;
lower half of the range) recovery of principal in the event of a
payment default.
S&P also affirmed its 'CCC+' issue-level rating (two notches below
the corporate credit rating) on the company's $40 million
second-lien term loan. The '6' recovery rating is unchanged,
indicating S&P's expectation for negligible (0%-10%) recovery of
principal in the event of a payment default.
"The affirmation reflects our belief that although UFS Holdings'
debt leverage will increase moderately after the announced dividend
recapitalization closes, the company's credit measures will remain
appropriate for the rating, including weighted-average funds from
operations (FFO) to debt of about 10%," said S&P Global Ratings'
credit analyst Brian Garcia. "Our corporate credit rating on the
company reflects our assessment of its business risk profile as
weak and its financial risk profile as highly leveraged." UFS
Holdings maintains leading market shares in highly fragmented
markets with weak pricing power. S&P expects that the company's
profitability will improve moderately in 2016 and 2017, compared to
2015 levels, excluding one-time costs associated with its
acquisition by H.I.G Capital.
The stable outlook reflects S&P's view that UFS Holdings' EBITDA
margins will improve in 2016, compared with 2015 levels, due to
certain cost-saving initiatives, and they will remain relatively
stable thereafter because the company has a leading position in the
niche markets in which it operates. S&P don't expect additional
meaningful debt-funded acquisitions or shareholder rewards in S&P's
base-case forecast. S&P believes that improving EBITDA margins
will result in gradually improving credit measures and expect the
company to maintain FFO to total adjusted debt of about 10% over
the next 12 months.
S&P could lower its corporate credit rating on UFS Holdings during
the next 12 months if the company's performance deteriorates as a
result of increased raw material costs or decreased end-market
demand, causing leverage measures to weaken. In addition, S&P
could lower the rating if the company makes additional large
debt-funded acquisitions or shareholder rewards. Based on S&P's
downside scenario, it could lower the rating if FFO to total
adjusted debt falls to about 5%, without prospects for improvement
over the next 12 months.
Although S&P views an upgrade as unlikely over the next 12 months,
it could raise the rating if the company generates significantly
stronger EBITDA margins than S&P projects and use cash flow for
debt reduction, resulting in FFO to total adjusted debt exceeding
15% on a sustainable basis (pro forma for acquisitions. For an
upgrade to occur, S&P would also need to be convinced that the
company's owners are committed to maintaining leverage at these
levels by maintaining a prudent approach to balancing debt
reduction, growth investment, and returning capital to
shareholders.
UNIVERSAL FIBER: Debt-Funded Dividend is Within Moody's B2 CFR
--------------------------------------------------------------
Moody's Investors Service Universal Fiber Systems, LLC's ("UFS", B2
stable) proposed debt-funded dividend to shareholders, funded in
part by a $44 million increase to the company's existing first lien
senior secured term loan, is a credit negative event, but within
expectations for the B2 Corporate Family Rating.
Universal Fiber Systems, LLC ("Universal") manufactures
solution-dyed and natural synthetic fibers used primarily in
commercial carpet, automotive, specialty apparel, and industrial
end markets. The company has facilities in the United States,
China, Thailand, and the United Kingdom. Universal generated over
$250 million of revenue for the twelve months ended July 1, 2016.
UNIVERSAL SECURITY: Gets Noncompliance Notice From NYSE Anew
------------------------------------------------------------
Universal Security Instruments, Inc., announced that, on Sept. 22,
2016, it received a letter from NYSE MKT LLC reiterating that the
Company is not in compliance with Sections 134 and 1101 of the
Exchange's Company Guide due to the Company's failure to timely
file its annual report on Form 10-K for the year ended March 31,
2016, and its quarterly report on Form 10-Q for the quarter ended
June 30, 2016, with the Securities and Exchange Commission.
The letter also states that the Exchange has reviewed the Company's
previously submitted plan of compliance and determined to accept
the Plan and grant a Plan period through Oct. 12, 2016, during
which time the Company will be subject to periodic review to
determine whether it is making progress consistent with the Plan.
The letter from the Exchange advised that if the Company is not in
compliance with the continued listing standards of the Company
Guide by Oct. 12, 2016, with respect to the delayed Annual Report
on Form 10-K and the delayed Quarterly Report on Form 10-Q, or if
the Company does not make progress consistent with the Plan during
the Plan Period, then the Exchange staff may initiate delisting
proceedings as appropriate. The Company is working diligently to
file the late Annual Report on Form 10-K by Sept. 28, 2016, and the
late Quarterly Report on Form 10-Q by Oct. 12, 2016, and to regain
compliance with the Company Guide.
About Universal Security
Owings Mills, Maryland-based Universal Security markets and
distributes safety and security products which are primarily
manufactured through its 50%-owned Hong Kong Joint Venture.
At Dec. 31, 2015, the Company had $20,213,695 in total assets,
$3,226,026 in total current liabilities and $16,987,669 in total
shareholders' equity.
"Our history of operating losses, declining revenues in prior
years, and limited financing options raises substantial doubt about
our ability to continue as a going concern. The Company had net
losses of $1,362,552 for the nine months ended December 31, 2015,
and $3,704,985 and $4,450,244 for the fiscal years ended March 31,
2015 and 2014, respectively. The Company is monitoring its
liquidity and working capital position in light of continued
operating losses, and decreases in its cash and working capital
position over the past four fiscal years of operations. In
addition to the expanded factoring agreement with Merchant Factors
Corporation (Merchant) as discussed below, the Company has
negotiated payment terms on its trade accounts payable to the Hong
Kong Joint Venture. The payment terms on the trade accounts
payable to the Hong Kong Joint Venture provide ninety day repayment
terms on up to $1,000,000 of purchases of the Company's new sealed
product line. The Company also believes that its cash position can
be improved by a combination of reductions in inventory and by
lowering expenses. In addition, the Company is prepared to
initiate changes in its operations, if needed, to reduce its
operating costs while maintaining its current level of customer
service. However, there are potential risks, including that the
Company's revenues may not reach levels required to return to
profitability, costs may exceed the Company's estimates, or the
Company's working capital needs may be greater than anticipated.
Any of these factors may change the Company's expectation of cash
usage in the remainder of the fiscal year ending March 31, 2016,
and beyond, or may significantly affect the Company's level of
liquidity. These financial statements do not
include any adjustments that might result from the Company not
being able to continue as a going concern," the Company stated in
its quarterly report for the period ended Dec. 31, 2015.
VALAIRCO INC: Seeks to Hire Vernoia Enterline as Accountant
-----------------------------------------------------------
Valairco, Inc. seeks approval from the U.S. Bankruptcy Court for
the District of New Jersey to hire an accountant.
The Debtor proposes to hire Vernoia, Enterline & Brewer to provide
accounting services, including the preparation of income tax
returns and monthly operating reports.
The firm's professionals and their hourly rates are:
Partner $210
Manager $175
Senior Accountant $165
Staff Accountant $150
Bookkeeper $65
Randall Enterline, a certified public accountant employed with
Vernoia, disclosed in a court filing that the firm is
"disinterested" as defined in section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Randall H. Enterline
Vernoia, Enterline & Brewer
91 West End Avenue
Somerville, NJ 08876
About Valairco Inc.
Valairco, Inc., dba Valairco Heating & Cool --
http://www.valairco.com/-- sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. D. N.J. Case No. 16-25936) on Aug. 18,
2016, listing under $50,000 in assets and under $500,000 in
liabilities.
The Debtor designs and installs heating and air conditioning
systems.
Valairco also filed for Chapter 11 protection (Bankr. D.N.J. Case
No. 80-00742) on Oct. 8, 1980. Another Chapter 11 petition was
filed (Bankr. D.N.J. Case No. 05-22042) on April 14, 2005.
VERTELLUS SPECIALTIES: Settles with EPA, 3 States
-------------------------------------------------
Vertellus Specialties Inc., and its debtor-affiliates ask the
Bankruptcy Court to approve a settlement agreement among the
Debtors, Valencia Bidco LLC, as Purchaser of the Debtors' assets,
the Official Committee of Unsecured Creditors, the United States
Department of Justice, the United States Environmental Protection
Agency, and the States of Ohio, Indiana and Utah.
The Purchaser submitted the only bid and, therefore, the Debtors
sought approval of the sale of substantially all of the Debtors'
assets to the Purchaser. The EPA et al. filed an Objection to the
Sale.
The Settlement Agreement generally provides that the Debtors' wind
down budget will be modified to increase the line item for
environmental expenses to be incurred by the Debtors following the
Closing of the Sale and through the effective date of a Plan from
$450,000 to $1 million (with not less than $550,000 in cash to fund
an Environmental Response Trust).
Under the Settlement Agreement, the Debtors agree that any Plan
proposed by the Debtors will provide for the establishment of an
Environmental Response Trust, the terms of which will be reflected
in a trust agreement to be agreed upon among the Beneficiaries of
the Environmental Response Trust and the Debtors (after
consultation with the Creditors' Committee) and annexed to the Plan
(or Plan supplement) or order dismissing the Chapter 11 Cases.
The purpose of the Environmental Response Trust will be to own, and
conduct or pay for Work at, the real property being placed into the
Environmental Response Trust, and to pursue any Applicable
Insurance claims and/or proceeds assigned to the Environmental
Response Trust.
The Debtors also will assign all claims and/or proceeds under or
relating to the Applicable Insurance coverage for losses or
liabilities for environmental releases or contamination, to the
greatest extent permitted by law and without breaching the terms of
the Applicable Insurance contracts, to the Environmental Response
Trust upon the earlier to occur of (i) the effective date of a
confirmed Plan or (ii) the date of the entry of a dismissal order
by the Bankruptcy Court. The Debtors, with the cooperation and
consent of the Purchaser, Purchaser's owners, Purchasers' owners'
affiliates as well as the co-lenders (but excluding PNC Bank, N.A.)
under the Debtors' prepetition and postpetition credit facilities,
will assign, transfer and/or otherwise cooperate in ensuring that
the applicable governmental unit obtains the benefit of any
Financial Assurance no later than the earlier to occur of (a) the
effective date of a confirmed Plan or (b) the date of entry of a
dismissal order by the Bankruptcy Court.
The real properties initially to be placed in the Environmental
Response Trust shall include the Provo, Utah, Wendover, Utah and
Miley Avenue properties should such
properties not be sold by the Debtors pursuant to Paragraph 11 of
the Settlement Agreement. Upon agreement by the United States on
behalf of EPA and the affected state, the Environmental Response
Trust may also include properties in Illinois, Indiana, Ohio, Utah
and West Virginia, provided that any such property is not sold.
Post-closing of the Sale, Purchaser will not sign or otherwise
become party to the Tibbs Avenue Superfund Site Consent Decrees;
provided, however, that Purchaser will comply with the Tibbs Avenue
Superfund Site Consent Decrees, including provisions requiring the
maintenance of financial assurance; and provided further, that EPA
and IDEM shall continue in good faith to consider approving air
sparging as an alternative remedy with respect to the Tibbs Avenue
Superfund Site and entering into a new agreement with the Purchaser
that will replace the Tibbs Avenue Superfund Site Consent Decrees.
The Settlement Agreement further provides that nothing contained
therein shall (i) compromise any rights or claims of the
Governments (as defined in the Settlement Agreement) in their
proofs of claim, or the Debtors' and/or Committee's right to object
to the amount, allowance, estimation or classification of such
proofs of claim, or (ii) limit, impair or otherwise restrict the
Plan's characterization and treatment of the consideration being
contributed to the Environmental Response Trust as a distribution
or deemed distribution on the Beneficiaries' claims.
About Vertellus Specialties
Vertellus Specialties Inc. is a global specialty chemicals company
focused on the manufacture of ingredients used in pharmaceuticals,
personal care, nutrition, agriculture, and a host of other market
areas affected by trends favoring "green" technologies and
chemistries.
Headquartered in Indianapolis, Indiana, Vertellus Specialties Inc.
and several affiliates filed separate Chapter 11 bankruptcy
petitions (Bankr. D. Del. Case Nos. 16-11289 to 16-11299) on May
31, 2016. Judge Christopher S. Sontchi presides over the case.
Stuart M. Brown, Esq., Kaitlin M. Edelman, Esq., Richard A.
Chesley, Esq., Daniel M. Simon, Esq., and David E. Avraham, Esq.,
at DLA Piper LLP (US) serve as the Debtors' bankruptcy counsel.
Jefferies LLC is the Debtors' investment banker. Andrew Hinkelman
at FTI Consulting, Inc., is the Debtors' chief restructuring
officer. Kurtzman Carson Consultants is the Debtors' claims and
noticing agent.
The Debtors estimated their assets at between $100 million and
$500
million and debts at between $500 million and $1 billion.
The petitions were signed by Anne Frye, vice president, secretary
and general counsel.
The Official Committee of Unsecured Creditors of Vertellus
Specialties Inc., et al., has tapped Hahn & Hessen LLP as lead
counsel; Morris James LLP as co-counsel; and Zolfo Cooper, LLC as
its financial advisor.
VIZIENT INC: Moody's Retains B2 CFR on Proposed Facility Amendment
------------------------------------------------------------------
Moody's Investors Service said that Vizient, Inc.'s proposed
amendment and re-pricing of its senior secured credit facility is
credit positive, but does not currently impact the B2 Corporate
Family Rating, the B1 rating on the first lien senior secured
credit facilities, Caa1 rating on the senior unsecured notes, or
the stable rating outlook.
Based in Irving, Texas, Vizient, Inc. provides products and
services which enable health care organizations to deliver more
cost-effective care. Health care organizations accessing Vizient's
products and services range from independent, community-based
health care organizations to large, integrated systems and academic
medical centers. The company also provides consulting services to
address clinical resource utilization, workforce management, as
well as business analytics and intelligence tools. The Company
serves approximately 5,200 health system members and affiliates as
well as 167,000 non-acute health care customers with combined
purchasing volume of roughly $90 billion annually. In early-2016,
Vizient acquired the Spend and Clinical Resource Management ("SCM")
and Sg2 businesses from MedAssets, Inc. The company operates under
a participant member ownership structure. The company generates
annual net sales of approximately
$1.2 billion.
WAREHOUSE 11: Seeks to Hire McKinley Onua as Legal Counsel
----------------------------------------------------------
Warehouse 11, LLC seeks approval from the U.S. Bankruptcy Court for
the Eastern District of New York to hire legal counsel in
connection with its Chapter 11 case.
The Debtor proposes to hire McKinley Onua & Associates, PLLC to
provide these legal services:
(a) advising the Debtor regarding its powers and duties;
(b) negotiating with creditors, preparing a plan of
reorganization and taking legal steps to consummate a
plan;
(c) appearing before various taxing authorities to work out a
plan to pay taxes; and
(d) preparing legal documents and appearing before the court
to protect the Debtor's interests.
The firm's professionals and their hourly rates are:
Nnenna Onua $350
Associates $250
Paralegals $100
In a court filing, Ms. Onua, Esq., the attorney designated to
represent the Debtor, disclosed that the firm is a "disinterested
person" as defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Nnenna Onua, Esq.
McKinley Onua & Associates, PLLC
26 Court Street, Suite 300
Brooklyn, New York 11242
Tel: 718-522-0236
Fax: 718-701-8309
Email: nonua@mckinleyonua.com
About Warehouse 11 LLC
Warehouse 11, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E. D. N.Y. Case No. 16-43127) on July 14,
2016. The petition was signed by Herman Epstein, manager.
The case is assigned to Judge Elizabeth S. Stong.
At the time of the filing, the Debtor estimated its assets and
liabilities at $1 million to $10 million.
WIND ENTERTAINMENT: To Sell New Equity Interests Under Plan
-----------------------------------------------------------
Wind Entertainment Corp. filed with the U.S. Bankruptcy Court for
the District of Nevada a first amended disclosure statement
describing its Chapter 11 plan of reorganization.
According to the amended disclosure statement, the Debtor is
currently negotiating with its landlord, FX Luxury Las Vegas I,
LLC, regarding the assumption of its unexpired lease and an
extension of the Lease, as the Lease is currently set to expire in
approximately 2.5 years. The Debtor is seeking a 5-year extension
of the Lease. In connection with any extension, however, FX may
require a recapture provision, which will allow FX to recapture the
leased premises upon 90 days' notice to the Debtor. In the event
FX exercises any right to recapture the leased premises, the
Debtor's business operations may cease and general unsecured claims
may receive no payments in the case.
Pursuant to the Plan, and as the Debtor's principal Restructuring
Transaction, the Debtor seeks to sell its equity in conjunction
with the Plan Confirmation process. Any proposed transaction
respecting the sale of the Debtor's New Equity Interests is subject
to the prior approval of the Bankruptcy Court.
Persons interested in acquiring some or all of the New Equity
Interests of the Debtor must submit a Qualifying Bid to the
Debtor's counsel by 4:00 p.m., Prevailing Pacific Time, at least 14
Days prior to the Confirmation Hearing (the "Initial Bid
Deadline"), unless such date is extended in the sole discretion of
the Debtor.
The Confirmation Hearing will also serve as the hearing to approve
the sale of the New Equity Interests (the "Sale Hearing"). The
transactions to be implemented pursuant to the Plan are subject to
a determination of the Debtor of which Entity or Entities, if any,
has submitted the highest and best bid for the Assets.
Each bidder who submits a qualified bid shall be deemed a
"Qualified Bidder". The Debtor's principal, Tommy J. Riccardo's
initial bid shall consist of the: (i) conversion of his
administrative claim; and (ii) Equity Contribution.
The Confirmation Hearing shall also serve as an auction (the
"Auction"), whereby Qualified Bidders may submit subsequent bids
for the New Equity Interests, provided (i) that the initial bid at
the Auction must exceed the Mr. Riccardo's bid by at least
$25,000.00, (ii) each subsequent bid at the Auction must exceed the
previous bid by at least $25,000.00 (the "Bidding Increment"), and
(iii) any Qualified Bidder which submits a subsequent bid at the
Confirmation Hearing in excess of its Qualifying Bid must provide
evidence that it has the financial capability to
purchase the New Equity Interests at the new, higher purchase price
as set forth in its subsequent bid.
At the conclusion of Auction, the Bankruptcy Court (i) shall
determine which bid constitutes the highest and best offer and
which bidder constitutes the winning bidder (respectively, the
"Winning Bid" and the "Winning Bidder") and (ii) approve the
Winning Bid at the Sale Hearing.
Promptly after the entry by the Bankruptcy Court of its order
approving the sale of the New Equity Interests, which may be the
Confirmation Order, the Deposits submitted by all Qualified Bidders
(other than the bid of the Winning Bidder(s)) shall be returned to
the respective Qualified Bidders.
The Bankruptcy Court may hear any aspect of the proposed sale of
the New Equity Interests, including, controversies relating to any
bidders' due diligence and to challenge any determination
made in connection therewith. In the event the Winning Bidder does
not close on the purchase of the New Equity Interests as set forth
in such Winning Bidder's Definitive Agreement, the Debtor shall
next pursue a sale of the New Equity Interests to the subsequent
highest Qualified Bidders, until such time as the New Equity
Interests are sold.
The Effective Date of the Plan shall not occur until the Winning
Bidder closes on the New Equity Interests and completes all
obligations pursuant to the Definitive Purchase Agreement (as
approved by the Bankruptcy Court) including payment of the purchase
price to the Debtor.
A full-text copy of the First Amended Disclosure Statement is
available at
http://bankrupt.com/misc/nvb16-10391-92.pdf
About Wind Entertainment Corp.
Wind Entertainment Corp. was formed in December 2012, and operates
an entertainment business which provides a platform for performing
arts, magic and illusion shows, and nightlife entertainment on the
Las Vegas Strip, just north of the MGM Grand Hotel and Casino, in
Las Vegas, Nevada. Thomas J. Riccardo, Jr., is the Debtor's
president and owner of the Debtor.
The Debtor's central asset is its lease agreement with FX Luxury
Las Vegas I, LLC, for the lease of the premises located at 3765
South Las Vegas Boulevard, Las Vegas, Nevada 891019. The Premises
consist of the Wind Theater (also known as the TW Theater Night
Club and Events Center) where the Debtor operates its entertainment
business and provides several performing arts, magic, illusion and
other shows on the Las Vegas Strip.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Nev. Case No. 16-10391) on Jan. 28, 2016. The
Debtor is represented by Samuel A. Schwartz, Esq., at Schwartz
Flansburg PLLC.
WINNERS SPORTS BAR: Unsecureds To Recover 10% Under Plan
--------------------------------------------------------
Winners Sports Bar And Grill, Inc., filed with the U.S. Bankruptcy
Court for the Northern District of Illinois a disclosure statement
describing the Debtor's plan of reorganization dated Sept. 12,
2016.
Under the Plan, each holder of Class 2 General Unsecured Claims,
which total $101,830.14, will receive payment of 10% of portion of
the claim as may be allowed payable in monthly payments over a
period of four years, in full satisfaction, settlement, release and
discharge of and in exchange for the claim.
Payments and distributions under the Plan will be funded by the
future revenues generated by the Debtor's business.
The Disclosure Statement is available at:
http://bankrupt.com/misc/ilnb15-26116-37.pdf
Winners Sports Bar And Grill, Inc., started operations in 1989, as
an Illinois corporation, operating a bar lounge located at 5912 -
5914 W. Madison St., Chicago, Illinois. Its president Percy
Washington is an employee of the corporation and the sole
shareholder.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr. N.D.
Ill. Case No. 15-26116).
WISCONSIN DAIRY GOAT: Disclosures Okayed, Plan Hearing on Oct. 24
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Wisconsin
will consider approval of the Chapter 11 plan of Southwestern
Wisconsin Dairy Goat Products Cooperative at a hearing on October
24.
The hearing will be held at 10:00 a.m., at the U.S. Bankruptcy
Court, Courtroom 350, 120 N. Henry Street, Madison, Wisconsin.
The court will also consider at the hearing the final approval of
the Debtor's disclosure statement, which it conditionally approved
on September 20.
The order set an October 17 deadline for creditors to cast their
votes and file their objections.
About Southwestern Wisconsin
Southwestern Wisconsin Dairy Goat Products Cooperative sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Wis. Case No. 16-11994) on June 3, 2016.
The Debtor is represented by Eliza M. Reyes, Esq., at Krekeler
Strother, S.C. The case is assigned to Judge Robert D. Martin.
ZOHAR CDO 2003: High Court Decline's Tilton's Bid to Block SEC Suit
-------------------------------------------------------------------
The American Bankruptcy Institute, citing Reuters, reported that
the U.S. Supreme Court has rejected a request by Lynn Tilton, the
New York financier accused by the Securities and Exchange
Commission of defrauding investors, to put on hold an SEC
enforcement action as she challenges the agency's in-house judicial
proceeding against her.
According to the report, the court's action means that Tilton will
face an Oct. 24 hearing before an SEC administrative law judge over
whether she and her firm, Patriarch Partners, hid the poor
performance of assets underlying her Zohar collateralized loan
obligation funds, and collected nearly $200 million in improper
fees.
As previously reported by The Troubled Company Reporter, citing
Daily Bankruptcy Review, a federal appeals court in New York
refused to stand in the way of a fraud case that the U.S.
Securities and Exchange Commission brought against former
distressed-company financier Lynn Tilton.
According to the report, Ms. Tilton sought to raise a
constitutional challenge to the SEC administrative securities fraud
action, which focuses on the $2.5 billion collection of distressed
company loans she controlled until recently.
The Second Circuit Court of Appeals, in a split decision, said Ms.
Tilton and her Patriarch Partners private-equity firm cannot seek
the aid of a federal court until the SEC proceeding, an
administrative action, is concluded, the report related.
In a statement, Patriarch Partners spokesman Richard White said
the
firm is "extremely disappointed" in the ruling, the report further
related. Ms. Tilton is reviewing her legal options in the wake of
the appellate court's decision, the report said, citing Mr. White.
The ruling means the SEC can move ahead in a proceeding where Ms.
Tilton and Patriarch are battling allegations that investors were
misled and losses hidden in the loan funds that fed cash to her
collection of troubled companies, the report added.
About Zohar CDO 2003-1
Patriarch Partners XV, LLC filed involuntary Chapter 11 bankruptcy
petitions against Zohar CDO 2003-1, Corp., Zohar CDO 2003-1,
Limited and Zohar CDO 2003-1, LLC (Bankr. S.D.N.Y. Case Nos.
15-23681 to 15-23682) on Nov. 22, 2015.
Patriarch Partners disclosed that it has filed, through one of its
affiliates, an involuntary Chapter 11 petition for Zohar CDO
2003-1, Limited. Patriarch is Zohar I's largest creditor, holding
$286.5 million face amount of Zohar I notes. Patriarch has placed
Zohar I into Chapter 11 in order to protect Zohar I and Patriarch
from the efforts of MBIA Inc. and MBIA Insurance Corporation,
another creditor of Zohar I, to obtain Zohar I's assets for
itself.
Patriarch claimed it has been forced to pursue this route because
of MBIA's fraudulent scheme to induce Patriarch XV to spend over
$103 million to buy out a third-party noteholder in Zohar-I to
facilitate a restructuring of Zohar-I.
Lynn Tilton is CEO of Patriarch.
Patriarch's restructuring counsel is Skadden, Arps, Slate, Meagher
& Flom LLP and its financial advisor is Moelis & Co.
[*] AlixPartners Appoints David Hindman to Turnaround Team
----------------------------------------------------------
AlixPartners, in a press release dated Sept. 27, 2016, said the
company has appointed David Hindman as a new Managing Director in
the Turnaround and Restructuring team based in the firm's new
Houston office. In this role, David will work closely with clients
in the energy sector facing strategic, financial, and operational
challenges, to restore performance and create value. He brings over
15 years' transformation and turnaround experience to the role, in
addition to extensive energy industry expertise.
David joins AlixPartners from Direct Energy, a subsidiary of
Centrica plc, where he led successful turnarounds of two of the
company's largest divisions. Prior to this role, he was a leader in
the Corporate Finance and Energy practices at McKinsey and before
that a Restructuring Adviser at UBS Warburg, LLC.
AlixPartners opened its Houston earlier this month to further
support the firm's clients in the region.
Simon Freakley, Chief Executive Officer at AlixPartners, said:
"David has a considerable breadth of experience, both in consulting
and the energy sector, and we're delighted to welcome him to the
team. AlixPartners is widely recognized for its expertise and
strong record in working with companies to make a difference in
high-impact situations and deliver sustainable results. David's
appointment further enhances our unique offering and deepens the
expertise of our Houston based team."
Industry Experience
Joined AlixPartners, Managing Director, 2016; Houston, TX, U.S.
Direct Energy (subsidiary of Centrica) 2010-2015; Houston, TX,
U.S.
VP and General Manager, US Residential (2014-2015);
VP and Head of Texas Wholesale and North American Retail Supply
(2010-2013).
McKinsey & Company, Leader in the Corporate Finance and Energy
practices, 2003-2010 and 1998-2000, Houston and Dallas, TX, U.S.
UBS Warburg LLC, Restructuring Adviser, 2002; New York, NY,
U.S.
Thayer Capital Partners, Private Equity Associate, 2000-2001;
Washington, DC, U.S.
Education
Masters of Business Administration, Harvard Business School
B.S. Mechanical Engineering and B.A. Economics, Rice
University.
Mr. Hindman may be reached at:
David Hindman
MANAGING DIRECTOR
Tel: (713) 276-4910
Email: dhindman@alixpartners.com
About AlixPartners
In today's fast paced global market timing is everything. You want
to protect, grow or transform your business. To meet these
challenges we offer clients small teams of highly qualified experts
with profound sector and operational insight. Our clients include
corporate boards and management, law firms, investment banks,
investors and others who appreciate the candor, dedication and
transformative expertise of our teams. We will ensure insight
drives action at that exact moment that is critical for success.
When it really matters.
[*] S.D.N.Y. Asks for Comment on Proposed Bankruptcy Rule Changes
-----------------------------------------------------------------
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
NOTICE TO THE BAR
PROPOSED AMENDMENTS TO LOCAL BANKRUPTCY RULES
The Local Rules Committee and the Judges for the United States
Bankruptcy Court for the Southern District of New York are
proposing amendments to the Local Bankruptcy Rules and have
requested that the proposals be circulated to the bar for comment.
The proposed amendments (appearing in purple redline against the
current version of the applicable Local Rules) are available at
http://www.nysb.uscourts.gov/by clicking on "Local
Rules/Orders/Guidelines" and then "Proposed Amendments to the Local
Rules effective December 1, 2016."
Please provide, as soon as possible, any comments with respect to
the proposed amendments. The comment deadline is Nov. 14, 2016 by
5:00 p.m. Please submit all comments electronically to
localrules@nysb.uscourts.gov or in writing to:
Emily Kehoe
Law Clerk to the Honorable Chief
Judge Cecelia G. Morris
Committee on Local Bankruptcy Rules
United States Bankruptcy Court for the
Southern District of New York
355 Main Street
Poughkeepsie, N.Y. 12601.
Please insert the phrase "Local Rules" in the subject line of all
comments.
The proposed amendments will not become effective until adopted by
the United States Bankruptcy Court for the Southern District of New
York.
[^] BOOK REVIEW: Oil Business in Latin America: The Early Years
---------------------------------------------------------------
Author: John D. Wirth Ed.
Publisher: Beard Books
Softcover: 282 pages
List price: $34.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at
http://is.gd/DvFouR
This book grew out of a 1981 meeting of the American Historical
Society. It highlights the origin and evolution of the state-
owned petroleum companies in Argentina, Mexico, Brazil, and
Venezuela.
Argentina was the first country ever to nationalize its
petroleum industry, and soon it was the norm worldwide, with the
notable exception of the United States. John Wirth calls this
phenomenon "perhaps in our century the oldest and most
celebrated of confrontations between powerful private entities
and the state."
The book consists of five case studies and a conclusion, as
follows:
* Jersey Standard and the Politics of Latin American Oil
Production, 1911-30 (Jonathan C. Brown)
* YPF: The Formative Years of Latin America's Pioneer State
Oil Company, 1922-39 (Carl E. Solberg)
* Setting the Brazilian Agenda, 1936-39 (John Wirth)
* Pemex: The Trajectory of National Oil Policy (Esperanza
Duran)
* The Politics of Energy in Venezuela (Edwin Lieuwen)
* The State Companies: A Public Policy Perspective (Alfred
H. Saulniers)
The authors assess the conditions at the time they were writing,
and relate them back to the critical formative years for each of
the companies under review. They also examine the four
interconnecting roles of a state-run oil industry and
distinguish them from those of a private company. First, is the
entrepreneurial role of control, management, and exploitation of
a nation's oil resources. Second, is production for the private
industrial sector at attractive prices. Third, is the
integration of plans for military, financial, and development
programs into the overall industrial policy planning process.
Finally, in some countries is the promotion of social
development by subsidizing energy for consumers and by promoting
the government's ideas of social and labor policy and labor
relations.
The author's approach is "conceptual and policy oriented rather
than narrative," but they provide a fascinating look at the
politics and development of the region. Mr. Brown provides a
concise history of the early years of the Standard Oil group and
the effects of its 1911 dissolution on its Latin American
operations, as well as power struggles with competitors and
governments that eventually nationalized most of its activities.
Mr. Solberg covers the many years of internal conflict over oil
policy in Argentina and YPF's lack of monopoly control over all
sectors of the oil industry. Mr. Wirth describes the politics
and individuals behind the privatization of Brazil's oil
industry leading to the creation of Petrobras in 1953. Mr. Duran
notes the wrangling between provinces and central government in
the evolution of Pemex, and in other Latin American countries.
Mr. Lieuwin discusses the mixed blessing that oil has proven for
Venezuela., creating a lopsided economy dependent on the ups and
downs of international markets. Mr. Saunders concludes that many
of the then-current problems of the state oil companies were
rooted in their early and checkered histories." Indeed, he says,
"the problems of the past have endured not because the public
petroleum companies behaved like the public enterprises they
are; they have endured because governments, as public owners,
have abdicated their responsibilities to the companies."
Jonh D. Wirth is Gildred Professor of Latin American Studies at
Standford University.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog,
Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa,
Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman,
Editors.
Copyright 2016. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
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are $25 each. For subscription information, contact Peter A.
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*** End of Transmission ***