/raid1/www/Hosts/bankrupt/TCR_Public/170626.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, June 26, 2017, Vol. 21, No. 176
Headlines
ABACUS INVESTMENT: Case Summary & 2 Unsecured Creditors
ACADANIA MANAGEMENT: Case Summary & 20 Largest Unsecured Creditors
ADVANCED PRECISION: Case Summary & 20 Largest Unsecured Creditors
ADVANCED RETAIL: Case Summary & 20 Largest Unsecured Creditors
AINA LE'A: Case Summary & 20 Largest Unsecured Creditors
ALISAL WATER: Fitch Affirms 'BB-' Issuer Default Rating
ALL-STATE FIRE: Case Summary & 20 Largest Unsecured Creditors
ALTICE USA: S&P Assigns 'B+' CCR Amid High Debt Leverage
AMERICAN AIRLINES: Union Equity Split in Good Faith, 9th Cir. Says
AMERILIFE GROUP: S&P Affirms 'B' CCR & Revises Outlook to Negative
APPLIED CLEANTECH: CEO Aharon Files Counterclaim vs. Shareholders
AVON INTERNATIONAL: Fitch Affirms 'B+' IDR; Outlook Negative
BADGER HOLDING: S&P Cuts CCR to 'B' on Acquisition by Brand Energy
BAKKEN INCOME: Taps TenOaks Energy as Sales Agent
BASEBALL PROTECTIVE: Plan Exclusivity Period Extended to July 29
BC EXPRESS: Wants July 18 Exclusive Plan Filing Deadline
BIG RACQUES RANCH: Wants Exclusive Plan Filing Extended to Sept. 6
BLACK MOUNTAIN GOLF: Seeks to Hire Coffey & Rader as Accountant
BOMBARDIER INC: Moody's Affirms B2 CFR, Outlook Stable
C & R EVENTS: Hearing on Disclosures Approval Set for July 18
C & R EVENTS: U.S. Trustee Unable to Appoint Committee
CABLEVISION SYSTEMS: S&P Raises CCR to 'B+'; Outlook Stable
CALIFORNIA PROTON: Seeks Summary Judgment vs. Scripps Clinic
CAMERON A. STEWART: Condo Units Up for July 24 Auction
CAPSTONE INFRASTRUCTURE: S&P Affirms Then Withdraws 'BB+' CCR
CARING HANDS: Unsecureds to Recoup 10% Under Plan
CCFA TRUST: Case Summary & 2 Unsecured Creditors
CELEBRATION COVE: Case Summary & 3 Unsecured Creditors
CEQUEL COMMUNICATIONS: S&P Raises CCR to 'B+'; Outlook Stable
CF BROADCASTING: Unsecureds to Recover 13% Over 36 Months
CHANDLER MEDICAL: Dental Center Up for Sept. 15 Auction
CHENIERE CORPUS: S&P Rates $1.5BB Secured Notes Due 2027 'BB-'
CHOICE ACADEMIES: S&P Affirms BB+ Rating on 2012 Bonds
CINRAM GROUP: Seeks December 14 Plan Filing Exclusivity Extension
CIRCULATORY CENTER: Plan Filing Deadline Moved to Aug. 21
CIRCULATORY CENTERS: Case Summary & 20 Top Unsecured Creditors
CNO FINANCIAL: S&P Affirms 'BB+' CCR & Alters Outlook to Stable
COMEBACK KINGS: Membership Certificates Up for Auction on June 28
CONCORDIA INTERNATIONAL: Hires Perella to Evaluate Alternatives
CROSIER FATHERS: U.S. Trustee Forms Five-Member Committee
DAKOTA PLAINS: Disclosures OK'd; Plan Hearing on Aug. 3
DAVID'S BRIDAL : Bank Debt Trades at 22% Off
DELIVERY AGENT: Seeks to Disqualify Firm on Abdo Representation
DELTAVILLE BOATYARD: Hearing on Disclosures OK Set for July 18
DIGIDEAL CORPORATION: Wants July 21 Exclusive Plan Filing Deadline
DON ROSE OIL: Case Summary & 20 Largest Unsecured Creditors
EAST TEXAS MEDICAL: Fitch Cuts Rating on 2007A/2011 Bonds to B+
EAST WEST COPOLYMER: 2 More Creditors Appointed to Committee
ECOARK HOLDINGS: Stockholders Elected Eight Directors
EL CANO DEVELOPMENT: Taps Mignucci as Special Counsel
EMAS CHIYODA: Needs Time to File Plan, End Non-Reorganizing Cases
ESTHEDONTICS INC: Life Investors Office Park Up for July 25 Sale
FANSTEEL INC: Taps Landis Rath as Special Counsel
FEDERAL-MOGUL LLC: Moody's Rates new EUR300MM Senior Sec. Notes B1
FEDERAL-MOGUL LLC: S&P Rates New EUR300MM Sec. Notes 'B-'
FINJAN HOLDINGS: Secures $15.3M Series A-1 Pref. Stock Financing
FIRSTRAIN INC: Hires JND Corporate as Noticing Agent
FLORIDA ORGANIC: U.S. Trustee Unable to Appoint Committee
FOLTS HOME: Seeks to Hire Clark Schaefer as Accountant
FORESIGHT ENERGY: Bank Debt Trades at 5% Off
GANDER MOUNTAIN: Needs More Time to Review Leases & File Plan
GATEWAY MEDICAL: U.S. Trustee Unable to Appoint Committee
GIGA-TRONICS INC: Incurs $1.54 Million Net Loss in Fiscal 2017
GIORGIO CAVALLI: U.S. Trustee Unable to Appoint Committee
GK HOLDINGS: S&P Lowers CCR to 'CCC+', Off CreditWatch Negative
GOLDEN MARINA: Exclusivity Periods Extended Through August 22
GREAT BASIN: Prices $2.7 Million Registered Offering of Units
GREENSTAR HOSPITALITY: Voluntary Chapter 11 Case Summary
GYMBOREE CORP: U.S. Trustee Forms Seven-Member Committee
HAMILTON ENGINEERING: HS Buy Steps Down as Member of Committee
HAMPSHIRE GROUP: Exclusivity Periods Extended Thru August
HASKELL PROPERTIES: NJ High Court Remands Suit vs. Insurers
HOME CAPITAL: S&P Affirms 'B-' Longterm ICR; Outlook Positive
HOMEJOY LLC: Unsecureds to Recoup 4.4% Under Plan
HT INTERMEDIATE: S&P Revises Outlook to Stable & Affirms 'B' CCR
IMMUCOR INC: Commences Notes Exchange Offer
IMMUCOR INC: Seeks to Extend Term Loan Maturity to 2021
INFRASTRUCTURE SOLUTION: Case Summary & 15 Top Unsecured Creditors
JACK ROSS: Disclosures OK'd; Plan Confirmation Hearing on July 26
JANKOSA INC: Wants Plan Exclusivity Extended through August 25
JO-ANN STORES: S&P Affirms 'B' CCR & Revises Outlook to Stable
KINGS INDUSTRIES: July 19 Plan Confirmation Hearing
KITTERY POINT: Voluntary Chapter 11 Case Summary
LAW-DEN NURSING: CAN Capital Objects to Plan & Disclosures
LENEXA HOTEL: Exclusive Plan Filing Period Extended Through Aug. 31
LIGHTING SCIENCE: Wins Appellate Reversal in Geveran Lawsuit
M2 NGAGE: Merges With Media Branding and Marketing Company Troika
MAISON HUGO: Seeks to Hire IPG as Real Estate Broker
MALIBU LIGHTING: MLC Unsecureds to Recover 6.1%-7.1% Under Plan
MARION SD 200: Moody's Cuts GOULT Debt Rating to Ba1
MAVERICK INT'L: Sale of Antique Canes, Beatles Items Until Today
MCCLATHCY CO: Will Sell Majority of 15% Ownership in CareerBuilder
MHE ASSOCIATES: Vacant Commercial Building Up for July 27 Auction
MISSISSIPPI POWER: Moody's Puts Ba1 CFR on Review for Downgrade
MOOD MEDIA: Moody's Assigns B3 CFR, Outlook Stable
NEW COVENANT PAINTING: Hires Bond Law Office as Attorney
NEXTERA ENERGY: Fitch Assigns First-Time BB+ Long-Term IDR
NEXTERA ENERGY: Moody's Assigns Ba1 Corporate Family Rating
NEXTERA ENERGY: S&P Assigns 'BB' CCR; Outlook Stable
NORTHWEST HARDWOODS: S&P Cuts CCR to 'B-' on Weak Credit Metrics
NUVERRA ENVIRONMENTAL: Wilmington Trust Opposes Bankr. Plan
OCEAN STATE THEATRE: June 30 Hearing to Name Permanent Receiver
OCONEE REGIONAL: Hires Bryan Cave as Bankruptcy Counsel
OLIVER C&I: Taps Nelson Robles-Diaz as Special Counsel
OMINTO INC: Director Mitch Hill Named Executive Chairman
OUTER HARBOR: Committee Appeals Decision Denying Ch. 7 Plan Probe
P & L GAS: To Pay IRS Monthly Installments, Plus 12% for 5 Yrs.
PACKAGING COORDINATORS: Moody's Cuts CFR to B3; Outlook Stable
PARAGON OFFSHORE: Exclusive Plan Filing Deadline Moved to Aug. 4
PAS REAL ESTATE: Case Summary & 2 Unsecured Creditors
PATTERN ENERGY: S&P Affirms 'BB-' CCR on Strategic Initiatives
PERFUMANIA HOLDINGS: In Talks With Nussdorfs on Restructuring
PERFUMANIA HOLDINGS: Incurs $9.65 Million Net Loss in 1st Quarter
PERFUMANIA HOLDINGS: Nussdorf Reports 13.7% Stake as of June 19
PETCO ANIMAL : Bank Debt Trades at 8% Off
PETSMART INC: Bank Debt Trades at 7% Off
PIONEER ENERGY: Current Drilling Utilization Is 83%
PREMIER DENTAL: S&P Rates $360-Mil. Secured Loans 'B-'
PREMIUM COMMERCIAL: Case Summary & 20 Largest Unsecured Creditors
PRESTIGE INDUSTRIES: Plan Filing Deadline Moved to August 15
PRIMELINE UTILITY: S&P Affirms 'B' CCR & Revises Outlook to Neg.
PUERTO RICO: Bid to Move SUT Dispute to PR Supreme Court Opposed
PUERTO RICO: Judge Dein May Handle Discovery, Pretrial Matters
PUERTO RICO: Judge Houser, 4 Others Named to Mediation Team
PUERTO RICO: June 28 Hearing on Procedures to Address SUT Dispute
PUERTO RICO: Retirees Tap Jenner & Block, Bennazar as Attorneys
QUANTEX LABORATORIES: Case Summary & 20 Top Unsecured Creditors
RANGER TRANSPORT: Case Summary & 9 Unsecured Creditors
RED PHOENIX: Voluntary Chapter 11 Case Summary
REV GROUP: Moody's Revises Outlook to Positive & Affirms B1 CFR
RLE INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors
RMS TITANIC: Equity Committee Hires Lincoln Partners as Advisors
ROBISON TIRE: Disclosures OK'd; Plan Hearing on Aug. 10
ROOSTER ENERGY: 2-Member Committee Appointed for Cochon Properties
ROOSTER ENERGY: 3-Member Committee Appointed for Rooster Petroleum
ROOSTER ENERGY: Taps Opportune as Restructuring Advisor
ROYAL HOLDINGS: S&P Raises CCR to 'B' on Improved Credit Metrics
RUPARI FOOD: Court Approves Amended $1.4M Employee Bonus Plans
RWK ELECTRIC: To Pay Unsecureds $30,300 Over Five Years
RYAN LLC: S&P Revises Outlook to Stable & Affirms 'B-' CCR
S K TRANSPORT: U.S. Trustee Unable to Appoint Committee
SANDERS NURSERY: Plan Solicitation Period Extended thru August 4
SEARS CANADA: CA$63.5 Million Directors' Charge Okayed
SEARS CANADA: CA$9.2-Mil. Key Employee Retention Plan Approved
SEARS CANADA: FTI Consulting Approved as CCAA Monitor
SEARS CANADA: To End Pension Payments, Retirees Hire Counsel
SERVICE WELDING: Taps Mark A. Weber as Accountant
SKIP BARBER RACING: Taps Rust/Omni as Claims & Noticing Agent
SPANISH BROADCASTING: Six Directors Elected by Stockholders
SPI ENERGY: BNY Mellon Reschedules ADR Termination Date
SPRUHA SHAH: Voluntary Chapter 11 Case Summary
STAFFING GROUP: Incurs $3.85 Million Net Loss in 2016
SUNEDISON INC: Oracle America Objects to Transition Services Pact
SUNEDISON INC: Unsecureds to Recoup 2.8% Under Amended Plan
SUNRISE REAL ESTATE: Files Delayed 2014 Annual Report
T.W. BYRNE: Tractors and Trailers Up for Auction on June 28
TAKATA CORP: Selling Biz to Key Safety Systems for $1.59-Billion
TAKATA CORP: Starts Civil Rehabilitation Proceedings in Japan
TAKATA CORP: U.S. & Mexican Units File for Chapter 11
TALOS ENERGY: S&P Withdraws 'SD' Corporate Credit Rating
TERRENO REALTY: Fitch Assigns BB Preferred Stock Rating
TRAMMELL FAMILY LAKE: Plan Filing Deadline Moved to Aug. 31
TRANSGENOMIC INC: Gives Financials for New Precipio Listing
US RENAL: Moody's Lowers Corporate Family Rating to B3
VANITY SHOP: Taps Diamond B Technology as IT Consultant
VENCORE INC: S&P Puts 'B' CCR on CreditWatch Positive
VINCE LLC: Moody's Cuts CFR to Caa2 & Revises Outlook to Negative
VRG LIQUIDATING: Exclusive Plan Filing Period Extended to Oct. 18
WALTER INVESTMENT: Bank Debt Trades at 8% Off
WEATHERFORD INTERNATIONAL: Deregisters Unissued Ordinary Shares
WERTHAN PACKAGING: Unsecureds To Recoup Up to 5% Under Plan
WHEATON LLC: Court Denies Confirmation of Reorganization Plan
WJA ASSET: TD REO Fund et al. Tap RJI International CPAs as Auditor
WORLD OF WOOD: July 18 Plan Confirmation Hearing
WRIGHT'S WELL: Hires HILCO as Asset Marketing and Sales Agent
XCEL DEVELOPMENT: Case Summary & 6 Unsecured Creditors
Z LIGHTS AND FURNITURE: Taps Olwan Ghannam as Accountant
[*] 24th Annual Distressed Investing Conference - Nov. 27, 2017
[*] CFPB, Law Firms Ordered to Mediate Deceptive Debt-Relief Claims
[*] Frank JC Newbould Joins Thornton Grout & Arbitration Place
[^] BOND PRICING: For the Week from June 19 to 23, 2017
*********
ABACUS INVESTMENT: Case Summary & 2 Unsecured Creditors
-------------------------------------------------------
Debtor: Abacus Investment Group, Inc.
1115 Shadow Court
Auburn, CA 95602
Business Description: The Company's principal assets are located
at 441 Lucerne Ave Tampa, FL 33606.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-05422
Court: United States Bankruptcy Court
Middle District of Florida (Tampa)
Debtor's Counsel: Joel S Treuhaft, Esq.
PALM HARBOR LAW GROUP, P.A.
2997 ALT 19 STE B
Palm Harbor, FL 34683-1907
Tel: 727-797-7799
Fax: 727-213-6933
E-mail: jstreuhaft@yahoo.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Herb Miller, president.
The Debtor's list of two unsecured creditors is available for free
at http://bankrupt.com/misc/flmb17-05422.pdf
ACADANIA MANAGEMENT: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Lead Debtor: Acadiana Management Group, LLC
101 La Rue France, Ste. 500
Lafayette, LA 70508
Type of Business: AMG and its affiliates generally own and operate
long-term acute care hospitals and associated
real estate for some of the hospitals across the
United States. The Operating Company Affiliates
operate LTAC hospitals in 12 locations: Wichita,
KS, Edmond, OK, Oklahoma City, OK, Tulsa, OK,
Greenwood, MS, Albuquerque, NM, Las Vegas, NV,
Lafayette, LA, West Greenfield, IN, Muncie, IN,
Houma, LA and Denham Springs, LA. Central
Indiana - AMG Specialty Hospital, L.L.C.
operates the West Greenfield and Muncie, IN
hospitals. LTAC Hospital of Edmond, L.L.C.
operates the hospitals in Edmond and Oklahoma
City, OK. AMG provides management, billing,
compliance, legal, financial, and accounting
services to the affiliated Debtors, and derives
income from the provision of those services.
The Chapter 11 filings were necessitated by the
effects of the U.S. Centers for Medicaid and
Medicare Services, new, more stringent LTAC
patient criteria, and a severe rate reduction
for non-qualifying patients receiving care at
AMG LTAC hospitals. These changes went into
effect for AMG and its affiliates in or about
September 2016.
Web site: http://amgihm.com/
Chapter 11 Petition Date: June 23, 2017
Affiliated debtors that simultaneously filed Chapter 11 petitions:
Debtor Case No.
------ --------
Acadiana Management Group, LLC 17-50799
AMG Hospital Company, LLC 17-50800
AMG Hospital Company II, LLC 17-50801
Albuquerque-AMG Specialty Hospital, LLC 17-50802
Central Indiana - AMG Specialty Hospital, LLC 17-50803
Tulsa - AMG Specialty Hospital, LLC 17-50804
LTAC Hospital of Louisiana - Denham Springs, LLC 17-50805
Las Vegas - AMG Specialty Hospital, LLC 17-50806
LTAC Hospital of Greenwood, LLC 17-50807
LTAC Hospital of Louisiana, LLC 17-50808
Houma - AMG Specialty Hospital, LLC 17-50809
LTAC Hospital of Edmond, LLC 17-50810
LTAC Hospital of Wichita, LLC 17-50811
AMG Realty I, LLC 17-50812
CHFG Albuquerque, LLC 17-50813
AMG Realty Youngsville, LLC 17-50814
Court: United States Bankruptcy Court
Western District of Louisiana (Lafayette)
Judge: Hon. Robert Summerhays
Debtors' Counsel: Bradley L. Drell, Esq.
Heather M. Mathews, Esq.
Gene B. Taylor, III, Esq.
GOLD, WEEMS, BRUSER, SUES & RUNDELL
POB 6118
Alexandria, LA 71307-6118
Tel: (318) 445-6471
E-mail: bdrell@goldweems.com
hmathews@goldweems.com
gtaylor@goldweems.com
Acadiana Management's
Estimated Assets: $0 to $50,000
Acadiana Management's
Estimated Debt: $50 million to $100 million
The petitions were signed by August J. Rantz, IV, president.
A full-text copy of Acadiana Management's petition is available for
free at:
http://bankrupt.com/misc/lawb17-50799.pdf
Acadiana Management's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
BOKF, NA dba Bank Real Estate Loan $14,117,647
of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
BOKF, NA dba Bank LTAC of Edmond, $6,862,744
of Oklahoma LLC, et al.
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
BOKF, NA dba Bank LTAC of Greenwood $490,196
of Oklahoma LLC
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
Capitol Hill $20,000
Consulting Group
499 South Capital
Street, SW
Suite 608
Washington, DC
20003
CHCT Louisiana, LLC AMG Realty $11,000,000
345 Cool Springs Blvd. Youngsville, LLC
Franklin, TN 37607
Computer Configuration $12,950
Services
Eastman National Bank LTAC of $73,529
Greenwood, LLC
Eastman National Bank Real Estate Loan $2,117,647
c/o BOKF NA dba
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
Eastman National Bank LTAC of Edmond, $1,029,406
c/o BOKF NA dba LLC, et al.
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
Health Care $33,196
Software, Inc.
KCI USA $9,787
NBC Oklahoma LTAC of $68,628
Greenwood, LLC
NBC Oklahoma Real Estate Loan $1,976,470
c/o BOKF NA dba
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
NBC Oklahoma LTAC of Edmond, $960,792
c/o BOKF NA dba LLC, et al.
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
PricewaterhouseCo $60,000
opers LLP
Prista Corporation $9,753
R&H Lear 60, LLC $15,900
Trustmark National Bank LTAC of $367,647
c/o BOKF NA dba Greenwood, LLC
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
Trustmark National Bank Real Estate Loan $10,588,235
c/o BOKF NA dba
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
Trustmark National LTAC of Edmond, $5,147,058
Bank LLC, et al.
c/o BOKF NA dba
Bank of Oklahoma
Attn: Brian Warden
9250 North May Ave.
Oklahoma City, OK
73102
ADVANCED PRECISION: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Advanced Precision Manufacturing, Inc.
2301 Estes Avenue
Elk Grove Village, IL 60007
Case No.: 17-18961
Business Description: Advanced Precision Manufacturing --
http://www.apmi.us/about.htm-- is a family-
owned business that produces and assembles
machined components for the aircraft
industries, as well as projects in the
automotive industry and commercial
manufacturing market. Founded in 1983, APMI
specializes in precision machining of all
standard metals as well as exotic materials
such as Inconel, Waspalloy, Titanium,
Beryllium Copper, Hastalloy, and other
materials for aviation aerospace, power
generation, medical and oil field drilling
applications.
Chapter 11 Petition Date: June 23, 2017
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Donald R Cassling
Debtor's Counsel: Jeffrey C Dan, Esq.
CRANE, HEYMAN, SIMON, WELCH & CLAR
135 S Lasalle St Ste 3705
Chicago, IL 60603
Tel: 312 641-6777
Fax: 312 641-7114
E-mail: jdan@craneheyman.com
Arthur G Simon, Esq.
CRANE, HEYMAN, SIMON, WELCH & CLAR
135 S Lasalle St Suite 3705
Chicago, IL 60603
Tel: 312 641-6777
Fax: 312 641-7114
Email: asimon@craneheyman.com
Brian P Welch
CRANE, HEYMAN, SIMON, WELCH & CLAR
135 S. LaSalle St., Suite 3705
Chicago, IL 60603
Tel: (312) - 641-6777
Fax: (312) 641-7114
Email: bwelch@craneheyman.com
David K Welch
CRANE, HEYMAN, SIMON, WELCH & CLAR
135 S Lasalle St, Suite 3705
Chicago, IL 60603
Tel: 312 641-6777
Fax: 312 641-7114
E-mail: dwelch@craneheyman.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Tadeusz Kozlowski, president.
The Debtor's 20 largest unsecured creditors is available for free
at:
http://bankrupt.com/misc/ilnb17-18961.pdf
ADVANCED RETAIL: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Advanced Retail Solutions, Inc.
1431 Airport Dr., Suite 600
Ball Ground, GA 30107
Business Description: Advanced Retail is a privately held company
in Ball Ground, GA, engaged in the business
of retail trade consulting.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-60948
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Debtor's Counsel: William A. Rountree, Esq.
MACEY, WILENSKY & HENNINGS LLC
Suite 4420
303 Peachtree Street, NE
Atlanta, GA 30308
Tel: 404-584-1200
Fax: 404-681-4355
E-mail: swenger@maceywilensky.com
csmith@maceywilensky.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Michael P. Reyes, president & CEO.
The Debtor's list of 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/ganb17-60948.pdf
AINA LE'A: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Aina Le'a, Inc.
fdba Aina Le'a, LLC
69-201 Waikoloa Beach Drive
Suite 2617
Waikoloa, HI 96738
Case No.: 17-00611
Type of Business: Headquartered in Waikoloa, Aina Le'a, Inc. --
http://ainaleahi.com/portfolio/kupu/--
acquires and develops land for residential and
commercial development. The Company constructs
townhomes, villas, and single-family residential
lots. Aina Le'a, Inc. was founded in 2009.
Chapter 11 Petition Date: June 22, 2017
Court: United States Bankruptcy Court
District of Hawaii (Honolulu)
Debtor's Counsel: Chuck C. Choi, Esq.
CHOI & ITO
745 Fort Street, Suite 1900
Honolulu, HI 96813
Tel: 808.533.1877
Fax: 808.566.6900
E-mail: cchoi@hibklaw.com
Estimated Assets: $100 million to $500 million
Estimated Debts: $10 million to $50 million
The petition was signed by Robert Wessels, CEO.
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
TrueStyle Pacific Builders Services $1,127,037
3517 West 10235 Rendered
South
South Jordan, UT
84095
E.M. Rivera and Sons, Inc. Services $572,537
P.O. Box 9031 Rendered
Kailua Kona, HI
96745
American Savings Bank Loan Purchase $480,000
P.O. Box 2300 Agreement
Honolulu, HI 96804
Nixon Peabody Services $253,685
Three First National Plaza Rendered
70 W Madison Ste
3500
Chicago, IL
60602-4224
Greenberg Traurig Services $242,523
Rendered
UHY/UKW Advisors Services $151,258
Rendered
Gusrae Kaplan Lawsuit $146,000
Nusbaum PLLC
First Insurance Funding Corp. $78,510
Prior Cashman Services $77,621
Rendered
Hawaii Precast, Inc. Trade Debt $66,898
Nakamoto, Okamoto & Services $47,665
Yamamoto Rendered
Tom Watts Services $44,741
Degele-Mathews & Yoshida Rendered
RR Donnelley Services $44,494
Rendered
McCorriston Miller Services $44,200
Mukai MacKinnon Rendered
MGO (Macias Gini & O'Connell LLP) Services $42,929
Rendered
Engineering Partners Services $38,224
Rendered
Aaron Chung, AAL $31,249
Morihara Lau & Fong Services $22,247
Rendered
Clifford & Company, Inc. Services $20,000
Rendered
Robert O'Brien Services $19,531
Rendered
ALISAL WATER: Fitch Affirms 'BB-' Issuer Default Rating
-------------------------------------------------------
Fitch Ratings has affirmed the following ratings for Alisal Water
Corporation (Alco):
-- Approximately $5.3 million of outstanding 2007A senior secured
taxable bonds at 'BB+';
-- Issuer Default Rating (IDR) at 'BB-'.
The Rating Outlook is Stable.
SECURITY
The bonds are secured by a security interest in pledged collateral,
which consists of all tangible and intangible assets owned by
Alco.
KEY RATING DRIVERS
ADEQUATE FINANCIALS: Alco's ratings reflect the utility's adequate
but relatively weak financial metrics, including below-average
all-in debt service coverage (DSC) and very low liquidity levels.
All-in DSC and days cash on hand finished at 1.2x and 71,
respectively, in fiscal 2016.
REGULATED PRIVATE UTILITY: Rate recovery is subject to approval
from the California Public Utilities Commission (CPUC). The
regulatory environment is relatively predictable and the utility
has generally achieved adjustments as needed, although customer
charges are somewhat high.
LIMITED SERVICE AREA AND MANAGEMENT: The customer base is limited
and the service area is characterized as having a weak economic
profile. Reflective of the size of operations, the number of
employees is relatively small, although the executive team is well
qualified.
CAPITAL STRUCTURE TO CONTINUE; NEEDS MANAGEABLE: Capital needs are
manageable which should help to improve Alco's elevated
debt-to-equity mix over time.
LONG-TERM SUPPLY ADEQUACY: The utility provides an essential
service and water supplies are sufficient to meet long-term
demands.
RATING SENSITIVITIES
CAPITAL STRUCTURE: Improvement in Alisal Water Corporation's
capital structure would alleviate leverage concerns.
RATE-BASE FLEXIBILITY: Unfavorable changes in California's
regulatory environment that make it more difficult to achieve
sufficient rate-base adjustments or other impediments to increasing
rates as necessary could pressure the rating.
CREDIT PROFILE
Alco is a private retail water company in Monterey County, CA. The
company serves a population of around 29,000 covering a portion of
the city of Salinas (the city). Part of Alco's certificated service
area includes undeveloped land within the city's extra-territorial
jurisdiction. Water supplies are derived exclusively from
groundwater sources.
ADEQUATE BUT WEAK FINANCIAL PERFORMANCE
Lower sales driven by conservation over the last three years have
led to lower operating revenue, with such measure finishing at $7.6
million in fiscal 2016 (down from a five-year high of $8.2 million
in 2014). However, a largely fixed portion of the customer bill
(resulting in less revenue volatility) combined with some capital
expenditure cuts in 2016 allowed management to somewhat preserve
financial margins. As a result, all-in debt service coverage
finished at just over 1.2x in fiscal 2016, a level commensurate
with the prior two years. EBITDA fared a little poorer, with
EBITDA-to-interest finishing 2016 at 1.4x versus 1.9x in the prior
year, as did return on equity (ROE), which finished at negative
2.6% in fiscal 2016 due to a net loss of negative $108,700. Alco's
financial ratios are low relative to most of Fitch's medians and
hence linked to the below investment-grade rating.
MIXED DEBT PROFILE
Alco's debt profile is mixed, with debt-to-EBITDA and
debt-to-equity remaining elevated. For example, the former finished
higher in fiscal 2016 given the lower earnings (finished at 6.6%
from 6.0% the year prior). Conversely, debt-per-customer improved
to $1,077 due to principal amortization. Principal amortization is
also favorable with 100% of debt to amortize within 10 years.
The debt profile should continue to improve as Alco's capital needs
are expected to be limited over the next five years and consist
basically of ongoing renewal and repair of assets, with such costs
paid from surplus revenues. Also, much of the company's capital
plan has been suspended to alleviate conservation-driven revenue
pressure.
STABLE REGULATORY ENVIRONMENT; ELEVATED RATES
The rates Alco charges its customers are regulated by the CPUC.
Historically, Alco has been granted timely rate increases as
needed. Fitch expects the CPUC will continue to allow future
adjustments to cover necessary inflationary, operating, and capital
expenditures, and to generate a ROE commensurate with other
similarly sized private water utilities in the state (currently in
the 10% range). Having said this, user rates are elevated and will
remain so. Currently, residential charges equal 1.1% of median
household income (MHI) based on 1,000 cubic feet of water usage per
month (Fitch considers rates over 1% of MHI to be elevated,
although Alco's rates are generally consistent with its regional
peers).
SUFFICIENT SUPPLY; LIMITED OPERATIONS
Supplies are estimated to be sufficient to meet customer demands
for the foreseeable future. Given the scope of operations, the
number of company personnel is limited, including the executive
team. Largely offsetting this concern are the sound experience and
qualifications associated with Alco's executive management team.
ALL-STATE FIRE: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: All-State Fire Protection, Inc.
107 Central Avenue
Wiggins, CO 80654
Case No.: 17-15844
Business Description: All State Fire Protection specializes in
the installation of fire sprinkler systems
for residential and commercial clients. The
Company provides in-house design,
fabrication and installation services. It
offers a range of steel and copper systems.
Founded in 1984, All State Fire Protection
also provides backhoe testing, tenant
finishing and annual inspection services.
Chapter 11 Petition Date: June 23, 2017
Court: United States Bankruptcy Court
District of Colorado (Denver)
Judge: Hon. Thomas B. McNamara
Debtor's Counsel: Kenneth J. Buechler, Esq.
BUECHLER & GARBER, LLC
999 18th St.
Ste., 1230 S
Denver, CO 80202
Tel: 720-381-0045
Fax: 720-381-0392
E-mail: ken@bandglawoffice.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Raymond Gibler, president.
The Debtor's list of 20 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/cob17-15844.pdf
ALTICE USA: S&P Assigns 'B+' CCR Amid High Debt Leverage
--------------------------------------------------------
S&P Global Ratings assigned its 'B+' corporate credit rating to
Bethpage, N.Y.-based Altice USA Inc. The outlook is stable.
The rating reflects high debt leverage, the capital-intensive
nature of the business, more fiber-based competition than most
incumbent cable providers, a degree of execution risk associated
with cost-cutting initiatives, and substitution risk from evolving
technology. These factors are partly offset by high barriers to
entry, good revenue visibility provided by a largely
subscription-based model, participation in well-clustered and
demographically favorable markets, and significantly improving
profitability.
The stable outlook reflects S&P's expectation for continued
deleveraging over the next year, with debt to EBITDA between
5.5x-6.0x by the end of 2017, as the company continues to benefit
from growth in HSD and cost-cutting initiatives. In addition, S&P
expects the company to generate positive FOCF despite planned
upgrades to the network, with FOCF to debt between 4%-6% in 2017.
S&P could lower the rating if subscriber trends worsen or planned
network investments result in a significant increase in capital
spending, such that FOCF declines substantially. S&P could also
lower the rating if leverage rises above 7x and remains there due
to a more aggressive financial policy, though a sizeable
acquisition could cause S&P to re-evaluate this threshold based on
its view of the business profile.
The rating is capped by the current 'B+' rating on the parent
Altice N.V. Accordingly, S&P could raise the rating if it upgrade
Altice N.V. and leverage falls below 5.5x at Altice USA with stable
subscriber trends, both of which S&P believes is unlikely over the
next year given the potential for debt-financed acquisitions.
AMERICAN AIRLINES: Union Equity Split in Good Faith, 9th Cir. Says
------------------------------------------------------------------
Kat Greene, writing for Bankruptcy Law360, reports that the Court
of Appeals for the Ninth Circuit found that the Transport Workers
Union of America hadn't acted in bad faith when it cut out certain
retirees from equity payments it received in an airline bankruptcy
settlement, concluding the union hadn't breached its duty of fair
representation of its members.
Workers who took an early separation deal in 2012 -- essentially, a
cash payment commensurate with how long they'd worked at the
company, plus their usual severance pay -- didn't get a share of
the equity payouts the union distributed after it struck a deal
with American in the bankruptcy proceedings, court records show,
according to Law360.
Circuit Judges Diarmuid F. O'Scannlain, Ronald M. Gould and Milan
D. Smith, Jr. concurred on the decision in late May 2017, Law360
points out.
The case is Daniel Demetris et al. v. Transport Workers Union Of
America, AFL-CIO et al., case number 15-15229, in the U.S. Court of
Appeals for the Ninth Circuit.
About American Airlines
AMR Corp. and its subsidiaries including American Airlines, the
third largest airline in the United States, filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 11-15463) in Manhattan
on Nov. 29, 2011, after failing to secure cost-cutting labor
agreements.
The Debtors tapped Weil, Gotshal & Manges LLP as bankruptcy
counsel; Paul Hastings LLP and Debevoise & Plimpton LLP Groom Law
Group, Chartered, as special counsel; Rothschild Inc., as
financial advisor; and Garden City Group Inc. as claims and notice
agent.
The Official Committee of Unsecured Creditors retained Jack
Butler, Esq., John Lyons, Esq., Felecia Perlman, Esq., and Jay
Goffman, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP as
counsel; Togut, Segal & Segal LLP as co-counsel for conflicts
and other matters; Moelis & Company LLC as investment banker;
and Mesirow Financial Consulting, LLC, as financial advisor.
AMR Corp., emerged from Chapter 11 bankruptcy protection on Dec.
9, 2013, upon which it merged with US Airways Group. The
combination of American Airlines and US Airways will result in the
largest U.S. airline, with the leading share of traffic along the
East Coast and Central U.S. regions.
AMERILIFE GROUP: S&P Affirms 'B' CCR & Revises Outlook to Negative
------------------------------------------------------------------
S&P Global Ratings said it affirmed its 'B' long-term corporate
credit rating on U.S. health/life insurance distributor AmeriLife
Group LLC. At the same time, S&P revised its outlook on the
company to negative from stable.
S&P also affirmed its 'B+' issue-level rating on the company's
first-lien secured revolver and term loan with a recovery ratings
of '2', indicating S&P's expectation for a substantial (70%)
recovery of principal in the event of a payment default. S&P also
affirmed its 'CCC+' issue-level rating on the second-lien secured
term loan with a recovery rating of '6', indicating S&P's
expectation for a negligible recovery (0%) in the event of a
payment default.
"The outlook revision reflects our view that AmeriLife's covenant
cushion under its first-lien credit agreement may tighten in
2017-2018 as the financial maintenance covenant (based on a total
net leverage ratio) steps down by 25 basis points per quarter
through the end of third-quarter 2018", said S&P Global Ratings
credit analyst James Sung. As of first-quarter 2017, AmeriLife had
a total net leverage ratio of 6.27x (as defined by the credit
agreement), a 16% covenant cushion versus the maximum allowed ratio
of 7.5x. However, S&P expects this cushion to tighten to about 10%
in 2017-2018 as the covenant steps down to 6.75x by year-end 2017
and 6.00x by year-end 2018.
S&P believes AmeriLife's business fundamentals remain sound, though
revenue and EBITDA growth have been slower than S&P forecasted.
Its competitive position is largely unchanged--it remains on one of
the largest independent distributors of senior-focused health/life
insurance products in the U.S. In addition, its client base is
stable; AmeriLife maintains long-standing relationships with top
insurance carriers. At the same time, AmeriLife's revenue and
EBITDA growth have been held back in recent years by the company's
focus on making growth-related investments in its core operations
instead of acquisitions. S&P believes these investments are
dampening EBITDA growth but will provide long-term competitive and
cost structure benefits.
In 2016, AmeriLife saw total revenues rise by 4.1% as renewal
commission growth offset first-year commission softness and
increased operational spending on new sales initiatives,
technology/system investments, and personnel restructuring. In
2017, S&P forecasts total revenues to grow by 5.5% with adjusted
EBITDA increasing by 13%-19%. S&P expects revenue and EBITDA
growth to be driven by Medicare sales, while new U.S. Dept. of
Labor (DOL) fiduciary regulations implemented in June 2017 will
constrain fixed-indexed annuity sales.
AmeriLife's key credit ratios remain weak, reflecting its
substantial debt load ($265.7 million on S&P's basis at year-end
2016) and slower-than-expected EBITDA growth. At year-end 2016,
AmeriLife had adjusted debt to EBITDA of 7.2x (versus our
expectations of 6.0x-6.5x) and EBITDA interest coverage of 1.8x
(versus S&P's expectations of 2.0x-2.5x). S&P forecasts adjusted
debt to EBITDA and EBITDA interest coverage to improve to 6.0x-6.5x
and 2.0x-2.5x, respectively, in 2017. This assumes AmeriLife uses
free cash flows for capital expenditures, requirement debt
amortization ($1.8 million per year), excess cash flow repayments,
and acquisitions.
S&P assess AmeriLife's liquidity as adequate, but S&P would likely
lower its assessment if its covenant cushion under its first-lien
credit agreement decreases to below 10% in 2017-2018. S&P expects
the covenant cushion under the second-lien credit agreement to
remain adequate (more than 15%). Regarding other aspects of
liquidity, - S&P expects cash sources to exceed uses by at least
1.2x in the next 12 months. S&P also believes its liquidity
profile benefits from sound banking relationships and generally
prudent financial management, and that its largely variable cost
structure and low capital expenditures provide financial
flexibility if needed.
Principal Liquidity Sources
-- $1 million-$3 million in run-rate cash and cash equivalents
-- $30 million revolver ($28 million in availability as of
March 31, 2017)
-- Positive funds from operations
Principal Liquidity Uses
-- Mandatory amortization of $1.8 million per year on the
first-lien term loan plus excess cash flow payments
-- Capital expenditures
-- Tax distributions to owners
-- Acquisitions
The negative outlook reflects S&P's expectation for the company's
covenant cushion to erode because of moderate step-downs. S&P'
believes the cushion could decrease to about 10% over the next 12
months. S&P forecasts total debt to EBITDA of 6.0x-6.5x by
year-end 2017 and 5.5x-6.0x by year-end 2018, with EBITDA interest
coverage of 2.0x-2.5x in both years.
S&P could lower the rating in the next 12 months if AmeriLife's
covenant cushion deteriorates modestly below 10%, and S&P believes
it is likely to stay at this level. This could be driven by a
moderate erosion of operating performance, covenant step-downs, or
some combination of both factors.
S&P could revise its outlook to stable in the next 12 months if the
company's covenant cushion stabilizes at 10%-15% (or higher) and it
appears likely to be sustained in 2018. This could result from the
company exceeding S&P's forecast through organic growth, or the
successful integration of acquisitions.
APPLIED CLEANTECH: CEO Aharon Files Counterclaim vs. Shareholders
-----------------------------------------------------------------
Rick Archer, writing for Bankruptcy Law360, reports that Applied
Cleantech CEO Refael Aharon argued in a counterclaim filed with the
Delaware Chancery Court that the Company's board members sabotaged
a potential deal and forced the company into insolvency for their
own financial benefit and to acquire its IP to develop through
third parties.
Previously, Law360 relates, investors Daniel Kleinberg, Tomer
Herzog, Saturn Partners LP II and Raika Engineering and
Infrastructures Ltd. claimed that Mr. Aharon has so mismanaged
Applied Cleantech and convinced the court to appoint a custodian.
In his counterclaim, Mr. Aharon specifically alleged that in 2015
and 2016, the suing shareholders sabotaged a deal with a Canadian
company, Law360 relates.
The case is SEPAGE Ltd. et. al. v. Daniel Kleinberg et. al., case
number 12719, in the Court of Chancery of the State of Delaware.
Applied Cleantech Inc. is an Israeli-based wastewater treatment
company.
AVON INTERNATIONAL: Fitch Affirms 'B+' IDR; Outlook Negative
------------------------------------------------------------
Fitch Ratings has affirmed Avon Products, Inc.'s (Avon) Long-Term
Issuer Default Rating (IDR) at 'B+'. The Rating Outlook is
Negative.
The ratings release was corrected on the same day it was released,
to include the affirmation of the Company's B+ IDR, which was
omitted from the original release.
KEY RATING DRIVERS
Weak Operating Trends: Avon's operating results have been on a
declining trajectory over the past five years. Two of the key
metrics that demonstrate the health of a direct-selling
organization, representative base and volume growth, have shown
continued declines. Avon has taken some positive steps, targeting
operating margin improvement through a three-year "Transformation
Plan", and selling a majority stake in the low-margin,
EBITDA-neutral North American business in 2016, which allows Avon
to focus on more profitable geographies.
Turnaround Visibility: Avon's recently reported first quarter
showed a 2% increase in revenue (-1% constant currency). It was
Avon's first quarter of positive growth since 3Q11 (including
currency impact). Fitch notes that the growth is a result of higher
price mix, as units sold continue to decline. Margins continue to
be challenged as Avon invests back in advertising and contends with
significantly higher bad-debt expense out of Brazil. The company
does appear to be on track with its Transformation Plan which
delivered $120 million in savings in 2016, ahead of expectations.
FX, Emerging Markets Exposure: Avon is one of the most
geographically diverse companies, selling to 57 countries and
territories. Avon's top 10 markets, mostly Emerging Markets,
account for 70% of revenue. Latin America represents 52% of
revenue, with Brazil, the single largest market, contributing 21%
of 2016's total revenue. Negative FX translation has had an
outsized impact on Avon's financials as most of its cash flows and
profits are generated outside the U.S.; economic and political
volatility can also have a significant impact.
Direct-Selling Model Challenge: The beauty industry is structurally
attractive and tends to be a resilient category throughout economic
cycles. Beauty & Personal Care categories reached $426 billion in
annual sales globally and Direct Selling reached $131 billion in
2015. With the channel shift towards e-commerce and specialty
stores, Avon, the world's #1 direct selling beauty company, is
facing intensified competition from multi-national beauty giants
who are implementing omni-channel strategies, as well as smaller,
nimbler, fast-growing companies.
Improved Financial Resiliency: The divestiture of the Liz Earle
business in 2015, sale of preferred stock, and partial sale of the
North American business in 2016 to Cerberus, enabled Avon to raise
liquidity and improve its capital structure, by repaying its 2016
notes and extending its maturity profile. No long-term debt is due
until March 2019. In 2016, Avon reduced debt by approximately $260
million. The Cerberus investment and dividend suspension provided
Avon with incremental liquidity. Fitch expects Total Debt/EBITDA to
remain within 4x-5x over the next three years.
DERIVATION SUMMARY
Avon's IDR reflects its sizable scale as a leading direct-selling
beauty company with $5.7 billion revenue in 2016 and its
well-recognized brand in the beauty industry. However, its
operating results have been on a declining trajectory in recent
years as the company faces challenges from its direct-selling
model, emerging market exposure, and FX headwinds. The Negative
Outlook continues to reflect the company's declining EBITDA trend,
due to its challenged business model and exposure to weak markets
such as Brazil and Russia.
Fitch's recovery analysis assumes $400 million going-concern
EBITDA, which represents approximately a 22% haircut to Avon's 2016
EBITDA of $510 million and a recovery multiple of 4x, driving an
estimated enterprise value (EV) of $1.6 billion. The going-concern
EBITDA reflects continued decline in Avon's key markets,
deteriorating margin due to competitive pressure, and business
model weakness. The recovery multiple of 4x EV/EBITDA multiple is
at the low end of recent consumer products transactions but
considers Avon's operating challenges. Avon is currently trading at
6x-7x EV/LTM EBITDA range.
Avon International's senior secured revolver and senior secured
notes are expected to have outstanding recovery prospects (91% -
100%) and as such are rated 'BB+/RR1' with 100% recovery prospect.
The revolver and senior secured notes are secured by Avon
International Operations, Inc., a wholly owned subsidiary of Avon,
and are guaranteed by Avon. Avon's senior unsecured notes are
expected to have average recovery prospects (31% - 50%) and are
rated 'B+/RR4' with a 39% recovery prospect.
KEY ASSUMPTIONS
Fitch's key assumptions within Fitch ratings case for the issuer
include:
-- Revenue is expected to grow at very low-single-digit rates,
primarily driven by pricing mix, barring further currency
movements
-- EBITDA (Fitch adjusted), which was approximately $510 million
in 2016, is projected to temporarily decline to approximately $470
million in 2017, due primarily to upfront investment in Avon's
Transformational Plan. Fitch expects that the combination of modest
revenue growth and expense management will drive EBITDA towards the
mid-$500 million level by 2020.
-- FCF is expected to be slightly negative in 2017 and turn
positive from 2018 onward given the completion of the
Transformation Plan and its associated cash costs in 2017. Fitch
assumes the company's dividend remains suspended throughout the
forecast period.
-- Leverage, which was 4.2x in 2016, is expected to increase to
mid-4x in 2017 on lower EBITDA, and improve toward 4.0x thereafter
on EBITDA improvement and some debt paydown.
RATING SENSITIVITIES
Future Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Stabilization of the Outlook is based on sustaining
flat-to-modestly positive representative growth as well as
low-single-digit organic growth;
-- While pricing may drive the bulk of organic growth in the near
term, Fitch expects positive volume to also be a contributor.
Future Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Continued sales declines;
-- EBITDA sustained below $500 million after 2017;
-- Reduced confidence in positive FCF after 2017;
-- Sustained increases in leverage over 5x;
-- Currency challenges in significant markets such as Brazil and
Russia. Avon's debt is dollar-based and cash flow for debt
service is generated offshore.
BADGER HOLDING: S&P Cuts CCR to 'B' on Acquisition by Brand Energy
------------------------------------------------------------------
S&P Global Ratings lowered its corporate credit rating on Badger
Holding LLC to 'B' from 'B+' and removed the rating from
CreditWatch, where S&P placed it with negative implications on
March 21, 2017. The outlook is stable.
At the same time, S&P withdrew its 'B+' issue-level rating and '4'
recovery rating on Safway Group Holding LLC's term loan because it
was repaid in connection with the transaction.
Subsequently, S&P withdrew its 'B' corporate credit rating on
Badger at the issuer's request.
These actions follow the completion of Brand Energy's acquisition
of Badger and its subsidiary Safway Group Holding LLC. Badger and
Safway are now wholly owned subsidiaries of Brand Energy and S&P
assess Badger as a core subsidiary of Brand Energy according to our
group rating methodology. Therefore, S&P equalized its corporate
credit rating on Badger with that of its parent before withdrawing
its ratings.
In S&P's view, it is highly unlikely that Brand Energy will sell
Badger because the company is successful, it has a commitment from
Brand Energy's management, and it operates in a business segment
that is integral to Brand Energy's overall strategy.
BAKKEN INCOME: Taps TenOaks Energy as Sales Agent
-------------------------------------------------
Bakken Income Fund LLC seeks approval from the U.S. Bankruptcy
Court for the District of Colorado to hire TenOaks Energy Advisors,
LLC as sales agent.
The Texas-based firm will facilitate the sale of the Debtor's oil
and gas interests and related assets.
TenOaks has already entered into a marketing agreement with
Coachman Energy Partners LLC and three other companies. Upon court
approval of its employment, the marketing agreement would be
amended to include the Debtor as a party.
The Debtor and the companies have agreed to pay the sales agent the
greater of (i) $350,000, or 3% of the aggregate consideration upon
the closing of each sale transaction.
Lindsay Sherrer, a partner at TenOaks, disclosed in a court filing
that her firm does not hold or represent any interest adverse to
the Debtor's bankruptcy estate.
The firm can be reached through:
Lindsay Sherrer
TenOaks Energy Advisors LLC
14180 N. Dallas Parkway, Suite 700
Dallas, TX 75254
Phone: 214-420-2320
About Bakken Income Fund
Bakken Income Fund LLC is an oil and gas investment fund. It was
formed in Colorado in 2011. Its corporate offices are located at
521 DTC Parkway, Suite 200, Greenwood Village, Colorado.
Bakken Income Fund sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Colo. Case No. 16-20212) on Oct. 17,
2016. Randall Kenworthy, the managing member, signed the petition.
The Debtor estimated its assets and liabilities at $1 million to
$10 million.
The Debtor is operating its business as debtor in possession
pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code. No
request has been made for the appointment of a trustee or
examiner, and no official committee has been established in this
case.
Judge Elizabeth E. Brown oversees the case.
The Debtor tapped Courtney H. Gilmer, Esq. at Baker, Donelson,
Bearman, Caldwell & Berkowitz, P.C. as lead bankruptcy counsel, and
Brownstein Hyatt Farber Schreck, LLP as co-counsel.
No trustee, examiner or official creditors' committee has been
appointed.
BASEBALL PROTECTIVE: Plan Exclusivity Period Extended to July 29
----------------------------------------------------------------
The Hon. James P. Smith of the U.S. Bankruptcy Court for the Middle
District of Georgia has extended, at the behest of Baseball
Protective, LLC, the period within which the Debtor has the
exclusive right to file a plan of reorganization, through and
including July 29, 2017, and to seek acceptance of such plan,
through and including Sept. 27, 2017.
As reported by the Troubled Company Reporter on June 1, 2017, the
Debtor said the extension of the exclusive periods will provide
time for the Debtor's management and special tax counsel to review
the disclosure statement and for the Debtor to provide more clarity
on the amount of potential sales taxes liability by allowing time
to the Debtor to consummate agreements regarding sales tax
liability. The Debtor also contends that the extension will permit
it to accurately estimate the return to creditors under its Plan
which will be beneficial to the Debtor's creditors and parties in
interest in considering the plan proposed by the Debtor.
About EvoShield, LLC
An involuntary Chapter 11 petition (Bankr. M.D. Ga. Case No.
16-31159) was commenced against EvoSheild, LLC, by petitioners Matt
Stover, KB3Interests, LLC, and Juanita Markwalter on Oct. 31, 2016.
The Petitioners hired McGuireWoods LLP and Crain Caton & James,
P.C., as counsel.
Headquartered in Bogart, Georgia, EvoShield LLC manufactures
protective sports gear for professional and college sports team.
The Debtor subsequently filed a consent to the bankruptcy petition.
On Dec. 1, 2016, an order of relief under Chapter 11 of the
Bankruptcy Code was entered in the case. The Debtor is operating
as a debtor-in-possession pursuant to 11 U.S.C. 1107 and 1108.
The Debtor tapped Lamberth, Cifelli, Ellis & Nason, P.A., as
counsel. The Debtor also hired Asbury Law as special tax counsel.
EvoShield was acquired by Wilson Sporting Goods Co. in October
2016. As of Nov. 17, 2016, Baseball Protective, LLC, operates as a
subsidiary of Wilson Sporting Goods Co.
BC EXPRESS: Wants July 18 Exclusive Plan Filing Deadline
--------------------------------------------------------
BC Express Mart, LLC, asks the U.S. Bankruptcy Court for the Middle
District of Georgia to extend the exclusive period for the Debtor
to file a plan through and including July 18, 2017, and the time
for the Debtor to obtain acceptances of any plan through and
including Sept. 15, 2017.
A hearing will be held on Aug. 2, 2017, at 11:00 a.m. to consider
the Debtor's request. Objections to the requested extension must
be filed by July 13, 2017.
About BC Express Mart
BC Express LLC filed for bankruptcy protection (Bankr. M.D. Ga.
Case No. 17-50113) on Jan. 18, 2017. The petition was signed by
owner, Belinda Calloway. The case is assigned to Hon. James P.
Smith.
The Debtor listed estimated assets and liabilities of $1 million to
$10 million.
Joel A.J. Callins, Esq., of The Callins Law Firm, LLC, serves as
counsel to the Debtor.
BIG RACQUES RANCH: Wants Exclusive Plan Filing Extended to Sept. 6
------------------------------------------------------------------
Big Racques Ranch, LLC, asks the U.S. Bankruptcy Court for the
Western District of Texas to extend the exclusive period for it to
file a plan of reorganization and disclosure statement until Sept.
6, 2017, and the deadline to obtain confirmation of the Plan until
Dec. 5, 2017.
The Debtor says that it will not be able to file a plan of
reorganization and disclosure statement by the current exclusive
plan filing deadline, July 8, 2017, because additional time is
needed to coordinate the completion and filing of the Plan and
Disclosure Statement. The Debtor is exploring all options,
including a sale of its assets (to realize the substantial equity
in real property), leasing the real property for hunting,
increasing agricultural income from harvesting, as well as any and
all available alternatives, to generate the necessary income to
service the outstanding debt of the Debtor. Capital Farm Credit
has a lien on all of the Debtor's assets.
The Debtor states that it has been working diligently with its
counsel to prepare the necessary information which is essential to
a Plan and Disclosure Statement. The Plan and Disclosure Statement
are in the process of being drafted and circulated to the Debtor
for review and comment. The Debtor tells the Court that more time
is needed to complete and finalize the plan terms prior to filing.
The Debtor and its counsel need up to an additional 60 days to
complete and file the Plan and Disclosure Statement. The goal of
the Debtor is to file a Plan and Disclosure Statement as soon as
possible, and the Debtor will continue with its best efforts in
doing so.
About Big Racques Ranch, LLC
Big Racques Ranch, LLC of Charlotte, Texas, filed a voluntary
petition under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex.
Case No. 17-50573) on March 10, 2017. The petition was signed by
Randy Benavides Balderas, president.
The Debtor is represented by William R. Davis, Jr. of Langley &
Banack, Inc. Judge Craig A. Gargotta presides over the case.
As of the date of the Petition Date, the Debtor listed $1 million
to $10 million in estimated assets and $1 million to $10 million in
estimated liabilities.
Lyssy and Eckel, Inc., is listed as the largest unsecured creditor.
BLACK MOUNTAIN GOLF: Seeks to Hire Coffey & Rader as Accountant
---------------------------------------------------------------
Black Mountain Golf & Country Club has filed an application seeking
approval from the U.S. Bankruptcy Court in Nevada to hire Coffey &
Rader CPA as its accountant effective March 30.
The Debtor also seeks approval for the payment of $2,750 to Coffey
& Rader for the preparation of its 2016 federal tax returns.
Coffey & Rader has been the Debtor's accountant prior to its
Chapter 11 filing. The firm, without knowledge of the bankruptcy
filing, prepared the Debtor's 2016 federal tax returns and invoiced
the Debtor $2,750. Because it was invoiced post-petition, the
Debtor's management company paid the amount.
Coffey & Rader is a "disinterested person" as defined in section
101(14) of the Bankruptcy Code, according to court filings.
The firm maintains an office at:
Coffey & Rader CPA
6625 W. Sahara Avenue, Suite 1
Las Vegas, NV 89146-0856
Phone: (702) 876-8900
Email: John@coffeyandrader.com
About Black Mountain Golf & Country Club
Based in Henderson, Nevada, Black Mountain Golf & Country Club is a
member-owned golf facility open to the public. The Company is
non-profit corporation and a tax-exempt entity.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Nev. Case No. 17-11540) on March 30, 2017. The
petition was signed by Larry Tindall, president. At the time of
the filing, the Debtor estimated its assets at $10 million to $50
million and debts at $1 million to $10 million.
The case is assigned to Judge Bruce T. Beesley. Morris Polich &
Purdy LLP is the Debtor's legal counsel.
BOMBARDIER INC: Moody's Affirms B2 CFR, Outlook Stable
------------------------------------------------------
Moody's Investors Service affirmed Bombardier Inc's Corporate
Family rating (CFR) at B2, its probability of default rating at
B2-PD, its senior unsecured rating at B3 and the company's
speculative grade liquidity rating at SGL-2, indicating good
liquidity. Bombardier's rating outlook remains stable.
"The rating affirmation reflects continued improvement in
Bombardier's margins and a reduction in cash consumption" said
Jamie Koutsoukis, Moody's analyst. She added that "Bombardier also
has sufficient liquidity to manage through to 2019, when Moody's
expects the company will become cash generative."
Issuer: Bombardier Inc.
Affirmations:
-- Probability of Default Rating, Affirmed B2-PD
-- Speculative Grade Liquidity Rating, Affirmed SGL-2
-- Corporate Family Rating, Affirmed B2
-- Senior Unsecured Regular Bond/Debentures, Affirmed B3 (LGD 4)
Issuer: Broward (County of) FL
-- Backed Senior Unsecured Revenue Bonds, Affirmed B3 (LGD 4)
Issuer: Connecticut Development Authority
-- Backed Senior Unsecured Revenue Bonds, Affirmed B3 (LGD 4)
Outlook Actions:
Issuer: Bombardier Inc.
-- Outlook, Remains Stable
RATINGS RATIONALE
Bombardier's B2 CFR is driven by its significant financial leverage
and ongoing cash consumption, but supported by good liquidity and
the expectation the company will be near cash flow breakeven by
2018. Moody's expects consolidated adjusted debt to EBITDA to be
about 10x this year and 8x by the end of 2018. This leverage is
high but Moody's recognizes the trade-off of leverage for
liquidity. Bombardier will not need to access the capital or bank
markets until the end of 2019. During this time Moody's expect they
will consume about $900 million in free cash flow in 2017, but will
improve to near breakeven in 2018 as the C Series commercial jet
program ramps up towards its own breakeven in 2020 and the Global
7000 business jet program approaches entry into service in the
latter part of 2018.
Bombardier has shown improving margins in its businesses except for
its commercial aircraft segment which is affected by C Series ramp
up costs. However across its three main segments (transport,
business jets and commercial aircraft) there continues to be
increased competition, coupled with demand softness which could
challenge further improvement. Moody's expects Bombardier's EBIT to
materially improve in 2017 compared to 2016 with increases in
revenues and margins driven by increased C Series deliveries,
organization changes resulting in improved efficiencies, and
rightsizing of production rates.
Bombardier's C Series is nearing a year of commercial operation,
and performance of the aircraft is above expectations. Eight CS100
and six CS300 have been delivered to date, however Bombardier has
not announced new orders for the C Series since its 2016 sales to
Delta and Air Canada. The US Commerce Department has begun an
anti-dumping investigation into the CSeries based on a petition
filed by Boeing Co which could negatively impact future sales in
the US. Though the C Series production schedule is full through
2020, Bombardier needs new orders in order to achieve profitability
on the program.
With the commercial aircraft segment consuming cash, the
transportation and business jet segments produce essentially all
the company's EBIT. However market conditions for large cabin
business jets have softened in recent quarters while Bombardier's
Global 7000 plane has seen program delays and will not enter into
service until late 2018. The transportation segment remains
relatively stable and has been improving its margins, but is still
contending with an increasingly competitive market .
The company's significant scale and diversity, established global
market positions, natural barriers to entry and sizeable backlog
levels in its primary business segments favorably influence the
rating.
Bombardier has good liquidity (SGL-2), with $3.9 billion of
available liquidity sources versus Moody's estimate of about $900
million of adjusted negative free cash flow in 2017 and minimal
debt maturities. At March/17, Bombardier had cash of $2.9 billion
and $980 million (USD equivalent) of unused revolvers ($400 million
at BA due June 2020 and EUR 640 million at BT due May 2020).
Additionally Bombardier will receive CAD $372.5 million in
repayable contributions from the Canadian government over four
years to support a ramp-up in production of the company's Global
7000 long-range business jet and CSeries narrow-body airliner.
Bombardier's bank financial covenants are not public, but they
include minimum liquidity and maximum leverage requirements.
Moody's expects the company will maintain headroom against the
covenants. The company does not have any material debt maturities
until 2019, when $600 million is due, and could be funded through
its current liquidity sources.
The stable ratings outlook reflects Bombardier's good liquidity
position, which supports its continuing cash consumption. It also
reflects Moody's expectation that the company will achieve
management's stated target of breakeven cash flow in 2018, while
leverage will improve from increased earnings as the C Series
program continues its production ramp up.
Bombardier's CFR rating could be upgraded if 1) the company
produces sustainable free cash flow, 2) adjusted financial leverage
reduces below 6.5x, and 3) the company is able to conduct business
without further government support.
Bombardier's CFR rating could be downgraded if 1) the company is
not able to achieve break-even free cash flow in 2018, 2) if the
company's adjusted debt/EBITDA leverage is likely to remain above
8x, or 3) if Moody's develops concerns over the adequacy of the
company's liquidity.
The principal methodology used in these ratings was Global
Aerospace and Defense Industry published in April 2014.
Headquartered in Montreal, Bombardier is a globally diversified
manufacturer of business and commercial jets as well as rail
transportation equipment. Annual revenues totaled roughly $16
billion in 2016.
C & R EVENTS: Hearing on Disclosures Approval Set for July 18
-------------------------------------------------------------
The Hon. David S. Kennedy of the U.S. Bankruptcy Court for the
Western District of Tennessee will hold on July 18, 2017, at 11:00
a.m. a hearing to consider the approval of C & R Events Enterprise
LLC's disclosure statement dated June 7, 2017, referring to the
Debtor's Chapter 11 plan dated June 7, 2017.
Objections to the Disclosure Statement must be filed by July 10,
2017.
About C & R Events Enterprise
Based in Memphis, Tennessee, C & R Events Enterprise LLC sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Tenn. Case No. 17-23363) on April 13, 2017. The petition was
signed by Francisco DaSilva, owner and manager.
At the time of the filing, the Debtor disclosed $1.87 million in
assets and $1.09 million in liabilities.
The case is assigned to Judge David S. Kennedy.
Henry C. Shelton, III, Esq., at Adams and Reese LLP serves as the
Debtor's bankruptcy counsel.
C & R EVENTS: U.S. Trustee Unable to Appoint Committee
------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of C & R Events Enterprise LLC as
of June 23, according to a court docket.
About C & R Events Enterprise
Based in Memphis, Tennessee, C & R Events Enterprise LLC was formed
to purchase the real estate at 2688 Poplar Avenue in Memphis as a
night club and entertainment venue.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. W.D. Tenn. Case No. 17-23363) on April 13, 2017. The
petition was signed by Francisco DaSilva, owner and manager. At
the time of the filing, the Debtor disclosed $1.87 million in
assets and $1.09 million in liabilities.
The case is assigned to Judge David S. Kennedy. Henry C. Shelton,
III, Esq., at Adams and Reese LLP serves as the Debtor's bankruptcy
counsel.
On June 7, 2017, the Debtor filed a disclosure statement, which
explains its proposed Chapter 11 plan of reorganization.
CABLEVISION SYSTEMS: S&P Raises CCR to 'B+'; Outlook Stable
-----------------------------------------------------------
S&P Global Ratings raised its corporate credit rating on Bethpage,
N.Y.-based Cablevision Systems Corp. to 'B+'. The outlook is
stable.
The upgrade reflects increased confidence that recently announced
investments in the network and user experience should allow the
company to maintain its market share relative to traditional
competitors over the next 2-3 years.
The stable outlook reflects S&P's expectation for continued
deleveraging over the next year, with debt to EBITDA between
5.5x-6.0x by the end of 2017, as the company continues to benefit
from growth in high-speed data and cost-cutting initiatives. In
addition, S&P expects the company to generate positive free
operating cash flow (FOCF) despite planned upgrades to the network,
with FOCF to debt between 4%-6% in 2017.
S&P could lower the rating if subscriber trends worsen or planned
network investments result in a significant increase in capital
spending, such that FOCF declines substantially. S&P could also
lower the rating if leverage rises above 7x and remains there due
to a more aggressive financial policy, though a sizeable
acquisition could cause S&P to re-evaluate this threshold based on
its view of the business profile.
The rating is capped by the current 'B+' rating on the parent
Altice N.V. Accordingly, S&P could raise the rating if it upgrades
Altice N.V. and leverage falls below 5.5x at Altice USA with stable
subscriber trends, both of which S&P believes is unlikely over the
next year given the potential for debt-financed acquisitions.
CALIFORNIA PROTON: Seeks Summary Judgment vs. Scripps Clinic
------------------------------------------------------------
Jeff Montgomery, writing for Bankruptcy Law360, reports that in an
adversary proceeding against Scripps Clinic Medical Group, Inc.,
California Proton Treatment Center LLC is seeking summary judgment
on Scripps' effort to shed its business operation contract as part
of the Debtor's chapter 11 proceeding.
Scripps operates the stand-alone San Diego facility under an
agreement with site and equipment owner California Proton.
California Proton said Scripps Clinic took in less than half its
minimum required revenues for the preceding two years under a
contract to operate California Proton's site and equipment, Law360
relates. The center generated $22 million a year against its $72
million annual budget, California Proton said, despite contract
requirements to cover at least 80 percent, or about $57 million, of
the yearly need, Law360 continues.
The adversary case is California Proton Treatment Center LLC v.
Scripps Clinic Medical Group, Inc, case number 1:17-ap-50330.
About California Proton Treatment Center
California Proton Treatment Center filed for Chapter 11 bankruptcy
protection (Bankr. D. Del. Case No. 17-10477) on March 1, 2017,
estimating its assets and debt at $100 million to $500 million. The
petition was signed by Jette Campbell, chief restructuring officer.
Judge Selber Silverstein presides over the case.
Locke Lord LLP serves as the Debtor's general counsel. The Debtor
hired Polsinelli PC as co-counsel with Locke Lord; Cain Brothers &
Company, LLC as investment banker; and Carl Marks Advisory Group
LLC as financial advisor.
On March 16, 2017, the Office of the U.S. Trustee appointed Melanie
L. Cyganowski as patient care ombudsman.
No request for the appointment of a trustee or an examiner has been
made in this Chapter 11 Case, and no committees have been appointed
or designated.
CAMERON A. STEWART: Condo Units Up for July 24 Auction
------------------------------------------------------
The Clerk of the Circuit Court in and for Duval County, Florida,
Ronnie Fussell, will at 11:00 a.m. Eastern time (ET) on July 24,
2017, offer for sale and sell to the highest bidder for cash at
www.duval.realforeclose.com Unit 3 and 4 of Mandarin Professional
Complex Condominium, together with its undivided share in the
common elements.
The sale will be held pursuant to a Final Judgment dated June 8,
2017, in the case styled as, COMPASS BANK, Plaintiff(s) vs. GORDON
P. JONES, as Trustee of the Bankruptcy Estate of DR. CAMERON A.
STEWART, D.C. LLC, a debtor under Bankruptcy Case No.
3:16-bk-04487-JAF filed in the United States Bankruptcy Court,
Middle District of Florida, DR. CAMERON A. STEWART, D.C. LLC, a
Florida limited liability company, MANDARIN PROFESSIONAL COMPLEX
CONDOMINIUM ASSOCIATION, INC., a Florida corporation, and ALL
UNKNOWN TENANTS or any parties in possession, Defendant(s), Case
No. 16-2017-CA-000991, in the Circuit Court in and for Duval
County, Florida. The sale will be made pursuant to and in order to
satisfy the terms of the Final Judgment.
Any person claiming an interest in the surplus from the sale, if
any, other than the property owner as of the date of the lis
pendens, must file a claim within 60 days after the sale.
Plaintiff's Attorney:
Michael A. Nardella, Esq.
Nardella & Nardella, PLLC
250 E. Colonial Drive, Suite 102
Orlando, FL 32801
Telephone: (407) 966-2680
E-mail: mnardella@nardellalaw.com
msayne@nardellalaw.com
CAPSTONE INFRASTRUCTURE: S&P Affirms Then Withdraws 'BB+' CCR
-------------------------------------------------------------
S&P Global Ratings said it affirmed its 'BB+' long-term corporate
credit rating on Capstone Infrastructure Corp. (CIC). At the same
time, S&P Global Ratings affirmed its 'B+' preferred stock rating
and 'P-4(High)' Canada national scale preferred share rating on the
company's preferred shares. The outlook is stable.
Subsequently, S&P Global Ratings withdrew its ratings on CIC at the
company's request.
The ratings on CIC before the withdrawal primarily reflected S&P's
view of a fair business risk profile, underpinned by a high
proportion of cash flows from long-term term contracts with
investment-grade counterparties, which provides stability to cash
flows. The company had no corporate-level debt and in S&P's debt
calculations S&P used imputed debt from the 50% of the preferred
shares. S&P expects the available cash flows will be used to
finance general and administrative expenses and preferred share
dividends at the corporate level. S&P also expected Capstone to
maintain credit metrics commensurate with the intermediate
financial risk profile.
RATINGS LIST
Ratings Affirmed
Capstone Infrastructure Corp.
Corporate Credit Rating BB+/Stable/--
Preferred Stock B+
Preferred Stock P-4(High)
Not Rated Action; CreditWatch/Outlook Action
To From
Capstone Infrastructure Corp.
Corporate Credit Rating NR/-- BB+/Stable/--
Preferred Stock NR B+
Preferred Stock NR P-4(High)
CARING HANDS: Unsecureds to Recoup 10% Under Plan
-------------------------------------------------
Caring Hands Home Care, Inc., asks the U.S. Bankruptcy Court for
the District of Minnesota to approve its disclosure statement dated
June 8, 2017, referring to its plan of reorganization.
The Class 2 general unsecured claims as listed in the Plan are
$399,367.90. The unsecured creditors will be paid 10% of their
claims within 24 months of the Effective Date.
Equity interest holders are parties who hold an ownership interest
(i.e., equity interest) in the Debtor. This class will consist of
the allowed ownership interests of the Debtor by its shareholders.
Gary and Patricia Johnson will pay a total of $1,000 on the
Effective Date of the Plan and shall be reinstated as the 100%
owners of the Debtor, with the ownership split as determined in the
sole discretion of the Johnsons.
Payments and distributions under the Plan will be funded by cash
flow from operations.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/mnb17-60044-36.pdf
About Caring Hands Home Care, Inc.
Caring Hands Home Care, Inc., has operated a home health care
agency since 1994 and is licensed by the Minnesota Department of
Human Services. The Debtor is also certified to provide services
under Medicare. Currently, the Debtor employs approximately 20
full and part-time employees, including 9 nurses, 7 home health
aides, 2 primarily administrative personnel, 1 occupational
therapist, and 1 physical therapist. The occupational therapist
and physical therapist are independent contractors who provide
services on a part time basis through the company.
The Debtor filed a voluntary Chapter 11 bankruptcy petition (Bankr.
D. Minn. Case No. 17-60044) on Jan. 27, 2017. The Debtor is
represented by Erik A Ahlgren, Esq. -- erikahlgren@charter.net --
at Ahlgren Law Office.
No committee of unsecured creditors has been established in this
case.
CCFA TRUST: Case Summary & 2 Unsecured Creditors
------------------------------------------------
Debtor: CCFA Trust Partnership
14995 Calle Privada
Rancho Santa Fe, CA 92091
Business Description: Single Asset Real Estate (as defined in 11
U.S.C. Section 101(51B))
Chapter 11 Petition Date: June 23, 2017
Case No.: 17-03728
Court: United States Bankruptcy Court
Southern District of California (San Diego)
Judge: Hon. Louise DeCarl Adler
Debtor's Counsel: Joseph M. Hoats, Esq.
LAW OFFICES OF JOSEPH M. HOATS
12672 Limonite Ave.
Suite 3E#345
Corona, CA 92880
Tel: 310-920-5806
Email: josephhoats@hotmail.com
josephmhoats@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dwight Jory, partner.
A list of the Debtor's two largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/casb17-03728.pdf
CELEBRATION COVE: Case Summary & 3 Unsecured Creditors
------------------------------------------------------
Debtor: Celebration Cove Resort LLC
245 Jess Jo Parkway
Branson, MO 65616
Business Description: Single Asset Real Estate (as defined in 11
U.S.C. Section 101(51B))
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-30335
Court: United States Bankruptcy Court
Western District of Missouri (Joplin)
Judge: Hon. Arthur B. Federman
Debtor's Counsel: Diana P. Brazeale, Esq.
BRAZEALE LAW FIRM, LLC
1484 Highway 248, Suite 105
Branson, MO 65616
Tel: 417-334-7494
Fax: 417-334-7405
E-mail: diana@brazealelaw.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Inderjit Grewal, member.
The Debtor's list of three unsecured creditors is available for
free at http://bankrupt.com/misc/mowb17-30335.pdf
CEQUEL COMMUNICATIONS: S&P Raises CCR to 'B+'; Outlook Stable
-------------------------------------------------------------
S&P Global Ratings raised its corporate credit rating on St.
Louis-based Cequel Communications Holdings I LLC to 'B+' from 'B'.
The outlook is stable.
At the same time, S&P raised all issue-level ratings one notch.
The upgrade reflects increased confidence that recently announced
investments in the network and user experience should allow the
company to maintain its market share relative to traditional
competitors over the next 2-3 years.
The stable outlook reflects S&P's expectation for continued
deleveraging over the next year, with debt to EBITDA between
5.5x-6.0x by the end of 2017, as the company continues to benefit
from growth in high-speed data and cost-cutting initiatives. In
addition, S&P expects the company to generate positive free
operating cash flow (FOCF) despite planned upgrades to the network,
with FOCF to debt between 4%-6% in 2017.
S&P could lower the rating if subscriber trends worsen or planned
network investments result in a significant increase in capital
spending, such that FOCF declines substantially. S&P could also
lower the rating if leverage rises above 7x and remains there due
to a more aggressive financial policy, though a sizeable
acquisition could cause S&P to re-evaluate this threshold based on
its view of the business profile.
The rating is capped by the current 'B+' rating on the parent
Altice N.V. Accordingly, S&P could raise the rating if it upgrades
Altice N.V. and leverage falls below 5.5x at Altice USA with stable
subscriber trends, both of which S&P believes is unlikely over the
next year given the potential for debt-financed acquisitions.
CF BROADCASTING: Unsecureds to Recover 13% Over 36 Months
---------------------------------------------------------
CF Broadcasting LLC filed with the U.S. Bankruptcy Court for the
Eastern District of Michigan a combined Chapter 11 plan and
disclosure statement dated June 12, 2017.
Class 6 General Unsecured Claims consist of claims filed by
creditors of the Debtors as well as deficiency claim of the Warner
Family Trust. Class 6 claims held by creditors other than the
Warner Trust total $22,821.61, excluding the disputed contingent
and unliquidated claims. All claims scheduled by the Debtor's as
contingent unliquidated or disputed, must timely file a Proof of
claim to receive distribution under the Plan. Failure to file a
proof of claim within the time allowed will result in no
distribution from the Estate. Confirmation of the Plan does not
provide for the allowance or payment of any individual claim. The
Debtor reserves the right to object to any claim.
Class 6 is impaired by the Plan. General unsecured creditors will
be paid an estimated of 13% of their claims via a base amount of
$3,000, over a 36-month period in twice yearly payments starting
180 days from the Effective Date of the Plan.
The effective date of the Plan will be Sept. 1, 2017, or 30 days
after entry of an order confirming the Plan, whichever will occur
later. For projection purposes, Sept. 1, 2017, has been used as
the effective date.
All payments due hereunder, unless otherwise stated, will commence
60 days after the Effective Date.
There are no post-petition transfers outside the ordinary course of
business to disclose of at this time.
The Debtor has received no post-petition financing of any sort.
Nor has adequate protection been requested or paid to any creditor.
It is expected there will be some post confirmation adequate
protection paid to the Warner Family Trust, in the time period
between the settlement of claims in the Adversary Proceeding and
confirmation of the Plan. This will only be subject to the Post
Confirmation Loan Agreement, Adversary Proceeding Settlement
Documents and further order of the
Court.
Resolution of the litigation with the Warner Family Trust has
allowed Debtor to reduce the amount necessary to service its
secured debt from 29% of gross revenue to approximately 13%, the
reduction in the amount necessary to service debt will allow
investment in the physical plant, and assure payment of future
operating expenses.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/mieb16-22172-56.pdf
CF Broadcasting LLC filed a Chapter 11 bankruptcy petition (Bankr.
E.D. Mich. Case No. 16-22172) on Dec. 14, 2016, disclosing under $1
million in both assets and liabilities. The Debtor is represented
by David R. Shook, Esq.
CHANDLER MEDICAL: Dental Center Up for Sept. 15 Auction
-------------------------------------------------------
Assets of Chandler Medical Building Investors, LLC, will be sold to
the highest bidder at a public auction at the lobby of Dickinson
Wright PLLC, 1850 North Central Avenue, Suite 1400, Phoenix,
Arizona 85004, at 10 a.m., on September 15, 2017, or at such later
time or location as may be announced by U.S. Bank National
Association, as successor trustee.
The assets are:
Parcel No. 1 Units A101, A103, A105, A201 and A205, Chandler
Medical/Dental Center, according to Declaration of Condominium
recorded in Document No. 2001-0462821B, and Affidavit of Correction
recorded in Document No. 20010979186, and plat recorded in Book 564
of Maps, Page 8, records of Maricopa County, Arizona
Parcel No. 2: Those certain non-exclusive easements for
ingress and egress pursuant to the Declaration of Easements,
Covenants, Conditions and Restrictions, recorded April 27, 2000 in
Document No. 2000-0318561, Maricopa County Records.
Parcel No. 3 Those certain non-exclusive easements for
ingress, egress and parking pursuant to the Declaration of
Covenants, Conditions and Restrictions, recorded on May 31, 2001 in
Document No. 2001-0462821A, as amended by First Amendment to
Chandler Medical/Dental Center Master Condominium Declaration of
Covenants, Conditions and Restrictions recorded September 17, 2002
in Document No. 2002-0951972 and by Second Amendment to Chandler
Medical/Dental Center Master Condominium Declaration of Covenants,
Conditions and Restrictions recorded on September 25, 2002 in
Document No. 2002-0984924, all Maricopa County Records.
Parcel No. 4 Those certain non-exclusive easements for ingress
and egress pursuant to the Declaration Establishing the Chandler
Medical/Dental Center Building A Condominium Association and
Declaration of Covenants, Conditions and Restrictions, recorded on
May 31, 2001 in Document No. 2001-0462821B, Maricopa County
Records.
U.S. Bank serves as successor to Wells Fargo Bank, N.A., as Trustee
for the registered holders of GS Mortgage Securities Corporation
II, Commercial Mortgage Pass-Through Certificates, Series 2007-GG10
by its Special Servicer C-III Asset Management LLC, a Delaware
limited liability company, 5221 N. O'Connor Blvd., Suite 600,
Irving, Texas 75039.
Goldman Sachs Commercial Mortgage Capital, L.P. serves as original
lender and secured party.
Chandler Medical has operates at:
-- 655 South Dobson Road Chandler, Arizona 85224;
-- 871 Country Club Road Suite B Eugene, Oregon 97401; and
-- 1095 W. Rio Salado Parkway Number 205 Tempe, Arizona
85282
U.S. Bank National Association, Successor to Wells Fargo Bank,
N.A., as Trustee, for the registered Holders of GS Mortgage
Securities Corporation II, Commercial Mortgage Pass-Through
Certificates, Series 2007-GG10 By: C-III Asset Management LLC, a
Delaware limited liability company, as successor to CW Capital
Asset Management LLC, in its capacity as special servicer pursuant
to that certain Pooling and Servicing Agreement dated July 1, 2007,
is represented by:
Michael R. Scheurich, Esq.
Dickinson Wright PLLC
1850 North Central Avenue, Ste. 1400
Phoenix, AZ 85004
Tel: (602) 285-5011
CHENIERE CORPUS: S&P Rates $1.5BB Secured Notes Due 2027 'BB-'
--------------------------------------------------------------
S&P Global Ratings said it assigned its 'BB-' issue-level rating
and '2' recovery rating to U.S. project financing Cheniere Corpus
Christi Holdings LLC's (CCH) $1.5 billion senior secured notes due
2027. The rating outlook is stable.
The '2' recovery rating indicates S&P's expectation for substantial
(70%-90%; rounded estimate: 80%) recovery in the event of a
default.
Since the rating on CCH's debt is capped by the corporate credit
rating on CEI, a negative outlook on or downgrade of CEI would
result in the same rating action on CCH's debt. At this time, S&P
thinks a deterioration of the rating on CEI over the outlook period
is unlikely. Aside from an adverse movement in S&P's rating on
CEI, a downgrade would require that the construction phase SACP
fall to 'b+'. Factors that would result in such a decline would be
major delays for completion or major cost overruns such that
available funding does not cover S&P's downside case cost profile
by a substantial margin. S&P considers such events unlikely.
Over the outlook horizon, the sole factor that would result in an
upgrade would be an upgrade of S&P's rating on CEI since it caps
the issue-level rating on CCH's debt. At this time, S&P thinks an
improvement in its rating on CEI over the outlook period is
unlikely.
Over the longer term during construction, once CEI has provided its
equity commitment, the rating would improve provided that the
construction phase SACP was at least 'bb'. Later, when the project
is at or near completion such that S&P has strong confidence in
operational performance, the rating would reflect the operations
phase risk profile.
CHOICE ACADEMIES: S&P Affirms BB+ Rating on 2012 Bonds
------------------------------------------------------
S&P Global Ratings revised its outlook to stable from positive and
affirmed its 'BB+' rating on the Phoenix Industrial Development
Authority, Ariz.'s series 2012 education facility revenue bonds
issued for Choice Academies Inc. (CA).
"The outlook revision is based on our expectations for financial
performance and lease-adjusted maximum annual debt service (MADS)
coverage (which include a small capital lease and an operating
lease for its Jefferson facilities) over the next year that will
remain more comparable to peers at the current rating," said S&P
Global Ratings credit analyst Melissa Brown. For fiscal year 2016,
the school did not meet expectations for a meaningful increase to
its waitlist, and financial performance was weaker than the prior
2015 audited year. Expectations for fiscal year 2017 indicate
similar performance to 2016, which would likely produce financial
profile metrics consistent with peers at the current rating.
S&P assessed CA's enterprise profile as adequate, characterized by
its healthy school-age population base, growing enrollment, lack of
a meaningful waitlist, good academics, and sound charter standing.
S&P assessed CA's financial profile as vulnerable with a high debt
burden, operating base of less than $10 million, positive
full-accrual operations, good liquidity, and sufficient
lease-adjusted MADS coverage for the rating.
The 2012 bonds are guaranteed by Choice Services LLC, an Arizona
limited liability company, the sole member of which is the school.
The guarantor currently operates a preschool facility in the new
building of the school's campus. Revenue of CA, as defined in
governing bond documents, primarily per-pupil funding from Arizona,
secures the bonds. In Arizona, state funding goes to the bond
trustee before it goes to the school.
CA Academy is a grade pre-K-12 charter school in northwest Phoenix.
"The stable outlook reflects our opinion that during the next year,
the charter school will maintain a steady financial profile by
continuing to generate positive revenue over expenses, keep its
healthy cash position, and maintain its sufficient lease-adjusted
MADS coverage for the rating," added Ms. Brown. S&P expects the
school's demand profile will continue to reflect good academics,
solid charter standing, and growing enrollment.
CINRAM GROUP: Seeks December 14 Plan Filing Exclusivity Extension
-----------------------------------------------------------------
Cinram Group Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the District of New Jersey to extend by approximately 150
days their exclusive periods to file chapter 11 plan and solicit
acceptances of such plan through and including December 14, 2017
and February 12, 2018, respectively.
The Debtors relate that they have made reasonable efforts since the
Petition Date to engage with the Committee and other key
stakeholders in an effort to reach a consensus regarding the terms
of a proposed chapter 11 plan. While those efforts have not yet
resulted in productive discussions among the parties, the Debtors
also relate that they have prepared and filed a Disclosure
Statement and Plan with the goal of confirming a fully consensual
plan.
Although the Debtors have filed a chapter 11 plan and are in the
process of seeking approval of the Disclosure Statement and to
solicit votes on such plan, the Debtors believe it is prudent to
extend the Exclusive Periods while they pursue confirmation of the
Plan. Accordingly, the Debtors seek an extension of the Exclusive
Periods of approximately 150 days.
The Debtors submit that having adequate opportunity to formulate
their plan and maintaining their exclusive right to file and
solicit votes on a chapter 11 plan is critical to their ability to
complete this process and achieve their remaining goals as
efficiently and expeditiously as possible without the risk of the
substantial additional costs and disruption that could result if
the Exclusive Periods were to expire.
As such, the Debtors contend that an extension of the Exclusive
Periods will provide them with adequate time to obtain approval of
the Disclosure Statement, conduct the solicitation process,
prosecute confirmation of the Plan and complete their restructuring
as efficiently as possible for the benefit of all stakeholders and
parties-in-interest.
About Cinram Group, Inc.
Cinram Group, Inc., based in Livingston, New Jersey, and its
affiliates filed a Chapter 11 petition (Bankr. D.N.J. Lead Case No.
17-15258) on March 17, 2017. The petition was signed by Glenn
Langberg, chief executive officer.
Cinram Group, Inc. estimated $1 million to $10 million in both
assets and liabilities. Cinram Operations, Inc. estimated $1
million to $10 million in assets and under $50,000 in liabilities.
Cinram Property Group, LLC listed $10 million to $50 million in
assets and under $50,000 in liabilities.
The Hon. Vincent F. Papalia presides over the jointly administered
cases. Kenneth A. Rosen, Esq., at Lowenstein Sandler, LLP, serves
as bankruptcy counsel to the Debtors.
On April 3, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee members
are SIR Properties Trust, MPEG LA LLC, Technicolor Home
Entertainment Services Inc., and Richter LLP. Cole Schotz P.C.
serves as bankruptcy counsel.
CIRCULATORY CENTER: Plan Filing Deadline Moved to Aug. 21
---------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Pennsylvania
has extended, at the behest of Circulatory Center of West Virginia,
Inc., the time in which only the Debtor may file its Plan of
Reorganization until Aug. 21, 2017, and the time in which the
Debtor may procure acceptance of the Plan until Nov. 18, 2017.
As reported by the Troubled Company Reporter on May 17, 2017, the
Debtor said it needs additional time to file a plan of
reorganization because it is still negotiating a sale of its
business operations, which sale is integral to any bankruptcy-exit
plan.
About Circulatory Center
Circulatory Center of West Virginia, Inc., sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
17-20211) on Jan. 20, 2017. The petition was signed by Tom Certo,
president. The case is assigned to Judge Gregory L. Taddonio. At
the time of the filing, the Debtor estimated assets of less than
$100,000 and liabilities of $1 million to $10 million.
The Debtor is represented by Robert O Lampl, Esq., at Robert O.
Lampl, Attorney at Law.
The Office of the U.S. Trustee on March 20, 2017, disclosed in a
court filing that no official committee of unsecured creditors has
been appointed in the Chapter 11 case of Circulatory Center of West
Virginia, Inc.
CIRCULATORY CENTERS: Case Summary & 20 Top Unsecured Creditors
--------------------------------------------------------------
Lead Debtor: Circulatory Centers, P.C.
300 Chapel Harbor Drive, Suite 102
Pittsburgh, PA 15238
Business Description: Circulatory Centers --
http://www.veinhealth.com-- is a provider
of varicose vein and spider vein treatment.
It is an affiliate of Circulatory
Center of West Virginia, Inc., which
sought bankruptcy protection on
Jan. 20, 2017 (Bankr. W.D. Pa. Case No.
17-20211).
Chapter 11 Petition Date: June 23, 2017
Affiliated debtors that simultaneously filed Chapter 11 bankruptcy
petitions:
Debtor Case No.
------ --------
Circulatory Centers, P.C. 17-22571
Circulatory Centers of America, LLC 17-22572
Circulatory Centers of Ohio, Inc. 17-22575
Circulatory Center of Pennsylvania, Inc. 17-22576
Court: United States Bankruptcy Court
Western District of Pennsylvania (Pittsburgh)
Judge: Hon. Gregory L. Taddonio
Debtors' Counsel: Robert O Lampl, Esq.
ROBERT O LAMPL, ATTORNEY AT LAW
960 Penn Avenue, Suite 1200
Pittsburgh, PA 15222
Tel: 412-392-0330
Fax: 412-392-0335
E-mail: rol@lampllaw.com
Estimated Estimated
Assets Liabilities
---------- -----------
Circulatory Centers, P.C. $100K-$500K $1M-$10M
Circulatory Centers of America, LLC $100K-$500K $1M-$10M
Circulatory Centers of Ohio, Inc. $100K-$500K $1M-$10M
Circulatory Center of Pennsylvania, Inc. $100K-$500K $1M-$10M
The petitions were signed by Tom Certo, president.
Circulatory Centers, P.C.'s list of 20 largest unsecured creditors
is available for free at:
http://bankrupt.com/misc/pawb17-22571.pdf
Circulatory Centers of America, LLC's list of 17 largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/pawb17-22572.pdf
Circulatory Centers of Ohio, Inc.'s list of five unsecured
creditors is available for free at:
http://bankrupt.com/misc/pawb17-22575.pdf
Circulatory Center of Pennsylvania, Inc.'s list of four unsecured
creditors is available for free at:
http://bankrupt.com/misc/pawb17-22576.pdf
CNO FINANCIAL: S&P Affirms 'BB+' CCR & Alters Outlook to Stable
---------------------------------------------------------------
S&P Global Ratings said it revised its outlook on CNO Financial
Group Inc. and its core operating subsidiaries to stable from
negative. At the same time, S&P affirmed its ratings on CNO and
its subsidiaries, including S&P's 'BB+' long-term counterparty
credit and 'BBB+' financial strength ratings on CNO. S&P's ratings
on CNO's subsidiaries include those on core operating subsidiaries
Bankers Conseco Life Insurance Co., Bankers Life & Casualty Co.,
Washington National Insurance Co., and Colonial Penn Life Insurance
Co.
"The outlook revision on CNO reflects the successful recapture of a
closed block of long-term care (LTC) insurance from Beechwood Re."
said Neal Freedman S&P Global Ratings credit analyst. The
September 2016 recapture resulted in a $75.4 million special charge
to pretax generally accepted accounting principles earnings, which
was consistent with the company's $70 million estimate when the
transaction was announced. Furthermore the company suspended its
shares repurchases in the fourth quarter of 2016 and contributed
$200 million of capital to its insurance operating companies to
maintain its target risk-adjusted capitalization and offset the
$135.9 million reduction in statutory surplus resulting from the
recapture. (CNO's regulatory risk-based capital ratio increased to
459% as of year-end 2016 from 449% in 2015, and share repurchases
resumed in first-quarter 2017.) Finally, the company produced 2016
adjusted EBIT (which excludes realized gains and losses and special
charges and includes imputed interest in operating leases) of
$475.6 million, which slightly exceeded our expectations of $350
million-$450 million and is consistent with prior expectations of
$450 million-$500 million.
The stable outlook reflects S&P's expectation that CNO will
maintain its strong competitive position with its expertise in the
middle-income market combined with its broad range of products and
its variety of distribution. S&P also expects it to maintain
risk-adjusted capitalization at least at the 'BBB' level per S&P's
model and to produce adjusted EBIT (which excludes realized gains
and losses and special charges and includes imputed interest on
operating leases) of $425 million-$475 million in 2017 and 2018.
S&P could lower the ratings by one notch if CNO's risk-adjusted
capitalization declines over the next 24 months and remains
consistently below the 'BBB' level per S&P's model. This would
likely occur if the company adopted a more-aggressive financial
policy or if earnings deteriorated significantly.
S&P could raise the ratings by one notch if CNO were to reduce its
LTC exposure significantly (especially to policies issued in 2002
and before) in the next 24 months. This would likely occur through
some agreement with an outside party. S&P could also raise the
ratings by one notch if the company were to adopt a more
conservative financial policy resulting in risk-adjusted
capitalization approaching the 'A' level per S&P's model on a
consistent basis.
COMEBACK KINGS: Membership Certificates Up for Auction on June 28
-----------------------------------------------------------------
Richard J. Kapner, Esq., PC, as attorney for Vilna Management, LLC,
will sell to the highest bidder at the public auction on June 28,
2017 at 10:00 a.m., the membership certificates of Comeback Kings
Media, LLC. The auction will be held at Richard J. Kapner, Esq.,
PC's offices in Hackensack, New Jersey.
The membership certificates were pledged to Vilna Management as
Collateral to guarantee payment to Vilna under a Promissory Note in
the principal sum of $500,000.00 made by Comeback Kings Media to
Vilna Management, LLC and dated April 7, 2017.
Comeback Kings has been declared in default under the Promissory
Note.
The Collateral may be redeemed by Debtors/owner(s) up to the time
of sale by payment in certified funds to the attorneys for the
Secured Party of all amounts then due and owing which approximates
$750,000.00 plus late feed and attorney's fees and costs as of June
9, 2017.
The Secured Party reserves the right to bid at sale, shall not be
required to post a deposit, and may credit against the purchase
price bid all amounts due it. The successful bidder shall be
required to deliver to the office of Richard J. Kapner, Esq., the
full purchase price at the time of the sale, in cash or by bank
check only. Should the successful bidder fail to so deliver the
purchase price, the Secured Party reserves the right, in its sole
discretion, to resell the Collateral, and any loss arising from
such re-sale shall be the responsibility of the defaulting
successful bidder. The sale may be subject to such further
conditions and provisions as may be announced at the start of the
sale.
The Collateral shall be sold "as is" and "where is", without
warranties, express or implied, and subject to superior liens, if
any.
Attorney for Vilna:
RICHARD J. KAPNER, ESQ., PC
155 Polifly Road, 2nd Floor
Hackensack, NJ 07601
Tel: (201) 883-0202
E-mail: richard@kapnerlaw.com
CONCORDIA INTERNATIONAL: Hires Perella to Evaluate Alternatives
---------------------------------------------------------------
Concordia International Corp. announced an update on the
development of its long-term growth strategy.
Further to previous communications, the Company's development of a
long-term growth strategy is nearing completion. Once finalized,
the Company intends to communicate its details with stakeholders in
the second half of 2017.
To support the development and execution of this strategy, the
Company has engaged Perella Weinberg Partners LP to provide
financial advisory services. These services may include, but are
not limited to, helping the Company explore and evaluate potential
transactional alternatives, including initiatives to optimize its
capital structure.
There can be no assurance that this process will result in any
transaction, or that any transaction, if pursued, will be
consummated. The Company does not expect to comment further unless
and until a specific transaction is approved by its Board of
Directors or the Company otherwise decides further disclosure is
appropriate or required.
"We have made significant progress on our long-term growth strategy
and we are looking forward to working with Perella Weinberg
Partners to support the Company in finalizing and executing on that
strategy," said Allan Oberman, chief executive officer of Concordia
International Corp.
About Concordia
Concordia -- http://www.concordiarx.com/-- is a diverse,
international specialty pharmaceutical company focused on generic
and legacy pharmaceutical products. Concordia has an international
footprint with sales in more than 90 countries, and has a
diversified portfolio of more than 200 established, off-patent
products. Concordia also markets Photofrin for the treatment of
certain rare forms of cancer.
The Company operates out of facilities in Oakville, Ontario and,
through its subsidiaries, operates out of facilities in Bridgetown,
Barbados; London, England and Mumbai, India.
Concordia reported a net loss of US$1.31 billion for the year ended
Dec. 31, 2016, compared to a net loss of US$31.56 million for the
year ended Dec. 31, 2015.
As of March 31, 2017, Concordia had US$3.61 billion in total
assets, US$4.05 billion in total liabilities and a total
shareholders' deficit of US$439.06 million.
* * *
In November 2016, Moody's Investors Service downgraded the ratings
of Concordia International Corp. including the Corporate Family
Rating to 'Caa1' from 'B3' and the Probability of Default Rating to
'Caa1-PD' from 'B3-PD'. "The downgrade follows continued weakness
in the business, an uncertain competitive environment, and an
unclear and challenging path towards deleveraging," said Jessica
Gladstone, Moody's senior vice president.
In May 2017, S&P Global Ratings lowered its corporate credit rating
on Concordia to 'CCC+' from 'B-'. "The downgrade reflects the
continued deterioration in Concordia's operating results, and
increased regulatory risk, which leads us to see heightened risk
for a potential distressed exchange or debt restructuring," said
S&P Global Ratings credit analyst Kim Logan.
CROSIER FATHERS: U.S. Trustee Forms Five-Member Committee
---------------------------------------------------------
Daniel McDermott, U.S. Trustee for Region 12, on June 22, 2017,
appointed five creditors to serve on the official committee of
unsecured creditors in the Chapter 11 cases of Crosier Fathers and
Brothers Province, Inc., and its debtor affiliates.
The committee members are:
(1) Kevin Cramsie
Attn: Mike Finnegan
Jeff Anderson & Associates, PA
366 Jackson Street, Suite 100
St. Paul, MN 55101
Tel: (651) 227-9990
E-mail: Mike@andersonadvociates.com
(2) Kelly Cummings
Attn: Mike Finnegan
Jeff Anderson & Associates, PA
366 Jackson Street, Suite 100
St. Paul, MN 55101
E-mail: Mike@andersonadvocates.com
Tel: (651) 227-9990
(3) Lyle Herbst
Attn: Mike Finnegan
366 Jackson Street, Suite 100
St. Paul, MN 55101
E-mail: Mike@andersonadvocates.com
Tel: (651) 227-9990
(4) Ben Januschka
Attn: Mike Finnegan
366 Jackson Street, Suite 100
St. Paul, MN 55101
E-mail: Mike@andersonadvocates.com
Tel: (651) 227-9990
(5) Jeff McMahon
Attn: Mike Finnegan
366 Jackson Street, Suite 100
St. Paul, MN 55101
E-mail: Mike@andersonadvocates.com
Tel: (651) 227-9990
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at a debtor's
expense. They may investigate the debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.
About Crosier Fathers and
Brothers Province, Inc.
Crosier Fathers and Brothers Province, Inc. --
https://www.crosier.org -- is a Minnesota non-profit corporation
that is the civil counterpart of the religious entity known as the
Canons Regular of the Order of the Holy Cross Province of St.
Odilia.
Crosier, Crosier Fathers of Onamia and The Crosier Community of
Phoenix sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D. Minn. Case No. 17-41681 to 17-41683) on June 1, 2017.
The Rev. Thomas Enneking, president, signed the petitions.
Crosier Fathers and Brothers listed under $1 million in assets and
under $500,000 in liabilities. Crosier Fathers of Onamia and The
Crosier Community of Phoenix each listed under $10 million in
assets. Crosier Fathers of Onamia listed under $10 million in
liabilities, while The Crosier Community of Phoenix listed under
$500,000 in debts.
Judge Robert J Kressel presides over the cases. The Debtors have
hired Quarles & Brady LLP as lead counsel and Larkin Hoffman as
local counsel. JND Corporate Restructuring has been retained as
claims and noticing agent.
The Debtors also have hired Keegan, Linscott and Kenon, P.C., as
accountant; Gaskins Bennett Birrell Schupp LLP as special insurance
counsel; Larson King LLP as special litigation counsel in civil
actions filed before the petition date; and Larkin Hoffman Daly &
Lindgren Ltd., as local counsel.
DAKOTA PLAINS: Disclosures OK'd; Plan Hearing on Aug. 3
-------------------------------------------------------
The Hon. Michael E. Ridgway of the U.S. Bankruptcy Court for the
District of Minnesota has approved the disclosure statement filed
by Dakota Plains Holdings, Inc., et al., on June 9, 2017, regarding
the Debtor's plan of reorganization dated June 9, 2017.
A hearing to consider confirmation of the Plan will be held on Aug.
3, 2017, at 1:00 p.m.
An objection to the confirmation of the Plan must be filed seven
days prior to the confirmation hearing.
Five days prior to the confirmation hearing is fixed as the last
day to timely file the ballots to accept or reject the Plan.
As reported by the Troubled Company Reporter on May 3, 2017,
BankruptcyData.com reported that the Debtors filed with the court a
joint plan of liquidation and related disclosure statement.
According to the Disclosure Statement, "[T]he Debtors conducted an
auction of substantially all of their assets on Jan. 23, 2017.
BioUrja Trading, LLC (the 'Purchaser') provided the highest and
best bid in the amount of $10.850 million. Following a hearing on
Jan. 27, 2017, the Bankruptcy Court entered the sale order, which,
among other things, approved the auction results and authorized the
sale of substantially all of the Debtors' assets to the purchaser.
Following the closing of the sale of substantially all of the
Debtors assets, the Debtors will no longer operate, but will
continue to liquidate any remaining assets and claims up until such
assets are transferred to the Liquidating Trust in accordance with
the Plan."
About Dakota Plains Holdings
Dakota Plains Holdings, Inc. (NYSE MKT: DAKP) --
http://www.dakotaplains.com/-- is an energy company operating the
Pioneer Terminal transloading facility. The Pioneer Terminal is
centrally located in Mountrail County, North Dakota, for Bakken and
Three Forks related Energy & Production activity.
Dakota Plains Holding and six of its wholly owned subsidiaries
filed voluntary Chapter 11 petitions (Bankr. D. Minn. Lead Case No.
16-43711) on Dec. 20, 2016, initiating a process intended to
preserve value and accommodate an eventual going-concern sale of
Dakota Plains' business operations. The petitions were signed by
Marty Beskow, CFO. The cases are assigned to Judge Michael E.
Ridgway.
At the time of the filing, Dakota Plains Holdings disclosed $3.08
million in assets and $75.38 million in liabilities.
Baker & Hostetler LLP has been tapped as the Debtors' legal
counsel. Ravich Meyer Kirkman McGrath Nauman & Tansey, A
Professional Association serves as co-counsel. Canaccord Genuity
Inc. serves as the Debtors' financial advisor and investment
banker, Carlson Advisors as accountant, James Thornton as special
purpose counsel.
The U.S. Trustee has been unable to appoint an official unsecured
creditors committee.
DAVID'S BRIDAL : Bank Debt Trades at 22% Off
--------------------------------------------
Participations in a syndicated loan under David's Bridal Inc is a
borrower traded in the secondary market at 78.40
cents-on-the-dollar during the week ended Friday, June 16, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.60 percentage points from the
previous week. David's Bridal pays 375 basis points above LIBOR to
borrow under the $0.520 billion facility. The bank loan matures on
Oct. 11, 2019 and carries Moody's B3 rating and Standard & Poor's
CCC+ rating. The loan is one of the biggest gainers and losers
among 247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended June 16.
DELIVERY AGENT: Seeks to Disqualify Firm on Abdo Representation
---------------------------------------------------------------
Martin O'Sullivan, writing for Bankruptcy Law360, reports that
executives of Delivery Agent Inc. are seeking for the
disqualification of Stearns Weaver Miller Weissler Alhadeff &
Sitterson PA from representing investor John Abdo in suing the
Debtors for alleged securities fraud -- saying that a company
executive previously sought legal advice from the firm.
The Delivery Agent officers, Law360 relates, said Stearns Weaver
should be booted from representing Abdo since attorney Alison
Miller had previously advised Delivery Agent CEO Fitzsimmons.
Law360 relates that investor John Abdo, as trustee of the John E.
Abdo Trusts, has alleged that the Debtors' officers, including CEO
Mark Fitzsimmons, concealed failures with the company's core
technology, particularly a product that was supposed to allow
consumers to purchase items advertised during Super Bowl XLVIII in
2014 directly from their televisions.
The case is Abdo et al. v. Fitzsimmons et al., case number
3:17-cv-00851, in the U.S. District for the Northern District of
California.
About Delivery Agent, Inc.
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 cases are assigned to Judge Laurie Selber
Silverstein.
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.
Andrew R. Vara, the Acting U.S. Trustee for Region 3, on Sept. 29,
2017, appointed seven creditors of Delivery Agent, Inc., to serve
on the official committee of unsecured creditors. The Committee
employs Pepper Hamilton LLP as counsel; and Carl Marks Advisory
Group LLC as financial advisors, nunc pro tunc to Oct. 3, 2016.
DELTAVILLE BOATYARD: Hearing on Disclosures OK Set for July 18
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Virginia will
hold on July 18, 2017, at 2:00 p.m. a hearing to consider the
approval of Deltaville Boatyard, LLC, et al.'s disclosure statement
referring to the Debtor's plan of reorganization.
Objections to the Disclosure Statement must be filed on or before
seven days prior to the date of the hearing.
About Deltaville Boatyard LLC
Boatyard Rentals, LLC, Deltaville Marina, LLC, and Deltaville
Boatyard, LLC, filed Chapter 11 petitions (Bankr. Case Nos.
16-35389, 16-35390, and 16-35974, respectively) on Nov. 2, 2016.
The petitions were signed by Kieth Ruse, manager. The Debtors are
represented by Paula S. Beran, Esq., at Tavenner & Beran, PLC.
Boatyard Rentals, LLC's case is assigned to Judge Keith L.
Phillips. Deltaville Marina, LLC's case is assigned to Judge Kevin
R. Huennekens. Deltaville Boatyard, LLC's case is assigned to
Judge Keith L. Phillips.
Boatyard Rentals, LLC, estimated assets of less than $1 million
and liabilities of $1 million to $10 million. Deltaville Marina,
LLC, estimated both assets and liabilities of $1 million to $10
million at the time of the filing. Deltaville Boatyard, LLC
estimated assets of less than $500,000 and liabilities of $1
million to $10 million.
DIGIDEAL CORPORATION: Wants July 21 Exclusive Plan Filing Deadline
------------------------------------------------------------------
Digideal Corporation asks the US Bankruptcy Court for the Eastern
District of Washington to extend to July 21, 2017, the exclusivity
period within which the Debtor has the exclusive right to file a
plan of reorganization.
About Digideal Corporation
Digideal Corporation sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Wash. Case No. 17-00449) on Feb. 22,
2017. The petition was signed by Michael J. Kuhn, president. The
case is assigned to Judge Frederick P. Corbit.
Kevin O'Rourke, Esq., at Southwell & O'Rourke, P.S., serves as the
Debtor's legal counsel.
At the time of the filing, the Debtor estimated its assets at $100
million to $500 million and liabilities at $1 million to $10
million.
DON ROSE OIL: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Don Rose Oil Co., Inc.
205 N. Ben Maddox Way
Visalia, CA 93292
Type of Business: Founded in 1972, Don Rose Oil is in the business
of wholesale distribution of petroleum and
petroleum products.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-12389
Court: United States Bankruptcy Court
Eastern District of California (Fresno)
Judge: Hon. Fredrick E. Clement
Debtor's Counsel: Riley C. Walter, Esq.
WALTER WILHEM LAW GROUP
205 E. River Park Circle, Ste. 410
Fresno, CA 93720
Tel: 559-435-9800
E-mail: rileywalter@w2ldg.com
Estimated Assets: $50 million to $100 million
Estimated Debts: $1 million to $10 million
The petition was signed by John Castellucci, president/CEO.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/caeb17-12389.pdf
Debtor's List of 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Kodiak Mining & Minerals II, LLC $2,000,000
7000 W. Palmetto Park Road
Suite 302
Boca Raton FL
33433-0000
Crestwood West Coast LLC $662,663
P.O. Box 95126
Dallas TX
75395-1216
NGL Crude Logistics LLC $377,139
6120 South Yale Ave.
Suite 805
Tulsa OK
74136-0000
Targa Liquids Marketing $371,132
P.O. Box 730155
Dallas, TX
75373-0155
NGL Crude Logistics LLC - AG $289,503
6120 South Yale Ave.
Suite 805
Tulsa, OK
74136-0000
JMBM $178,930
Flint Hills Resources, L.P. $172,487
Lubricating Specialties Co. $124,670
River City - AG $74,008
Targray Industries, Inc. $54,496
River City Petroleum $42,855
Gault Group LLC $38,369
Nations Fund 1, LLC $38,191
Firestream Worldwide, Inc. $20,728
Lee Financial Services $19,360
BMO Harris Bank NA $17,289
Morgan Stanley $13,600
The Diesel Doctor, Inc. $11,623
Amur Equipment Finance, Inc. $11,251
Department of Motor Vehicles $10,858
EAST TEXAS MEDICAL: Fitch Cuts Rating on 2007A/2011 Bonds to B+
---------------------------------------------------------------
Fitch Ratings has downgraded the rating for East Texas Medical
Center Regional Health System's (ETMC) to 'B+' from 'BBB-' on the
following revenue bonds issued on behalf of ETMC:
-- $35.8 million Wood County Central Hospital District hospital
revenue bonds, series 2011;
-- $244.2 million Tyler Health Facilities Development Corporation
hospital revenue bonds, series 2007A.
At the same time, ETMC's bonds have been placed on Rating Watch
Negative.
SECURITY
The bonds are secured by a pledge of gross revenues of the
obligated group, a first mortgage lien on certain property and debt
service reserve funds on the series 2007A and 2011 bonds.
KEY RATING DRIVERS
FUNDAMENTAL SHIFT IN OPERATING ENVIRONMENT: The rating downgrade
reflects ETMC's challenges navigating the recent payor shifts and
increased competition in their market and ETMC's resultant rapid
financial deterioration. At the time of Fitch's last review, Fitch
expected slow but steady improvement in operating performance
following the execution of new payor arrangements. The benefits
from these new payor contracts, however, have not materialized, and
ETMC has suffered significant operating losses as a result.
POTENTIAL ACQUISITION; ASSET SALE PRIMARY FIX: ETMC is not actively
pursuing any turnaround strategies and is instead focusing its
efforts on finding an acquisition partner for the system. The
execution risk is compounded by the separate sale of its ambulance
division following a whistle-blower lawsuit of that subsidiary.
RAPID DETERIORATION IN FINANCIAL PROFILE: Fiscal year 2017
represents the fourth year of progressively declining margins and
debt service coverage. The burn rate has accelerated through the
six months of fiscal 2017 (April 30) with operating EBITDA margin
deteriorating to -1.2%. ETMC expects to breach its rate covenant
for fiscal 2017. Furthermore, cash declined from a combination of
optional and early repayment of debt as well as ongoing operating
losses. As a result, days cash on hand (DCOH) decreased to 86.9
days as of April 30 from 104.8 days at fiscal year-end 2016.
RELIANCE ON SUPPLEMENTAL FUNDING: Fitch has historically viewed
ETMC's reliance on high supplemental payments from the Texas Waiver
1115 program to be a credit concern. After receiving net waiver
funds of $25.3 million in 2015 and $22.1 million in 2016, ETMC's
payments in 2017 decreased to $15 million after netting for state
recoupment of prior years' funding. Fitch expects the waiver
program to be extended past December 2017, although the level of
funding remains uncertain.
DECLINING SHARE OF COMPETITIVE MARKET: ETMC's declining market
share within its eight-county primary service area decreased again
in 2016 to 34%. The system's position is pressured by Trinity
Mother Frances (TMF), who has a slightly larger market share and
was acquired by CHRISTUS Health in 2016. TMF is a formidable
competitor in Tyler who gained market share in prior years while
ETMC was out of network with certain larger private payor contract
arrangements.
UNPROFITABLE RURAL HOSPITALS: ETMC's network of small rural
hospitals continues to struggle with low utilization. ETMC
discontinued six rural locations over the past couple years that
were no longer economically feasible. The declining trend, however,
continues for the rural hospitals that remain in ETMC's network.
RATING SENSITIVITIES
CONTINUED OPERATING PRESSURE IS EXPECTED: Fitch will review the
credit again in the coming months to assess progress towards the
acquisition of the system and the sale of the EMS division. The
rating is at risk of further downgrades, potentially multi-notch,
if the system does not find a strategic partner before triggering a
rate covenant default or substantially weakening the cash position
to a point that endangers the system's long-term viability.
CREDIT PROFILE
The ETMC health system services the east and northeastern regions
of Texas. ETMC's network consists of a tertiary care and level-one
trauma center in Tyler (Smith County), six smaller acute care
hospitals, and a rehabilitation and specialty hospital. The system
also has 40 rural clinics covering an eight-county area centered on
Smith County. Total revenues were $914.8 million in fiscal 2016.
Market Shifts
After more than a decade as the only hospital in Texas to be
excluded from the preferred provider organization (PPO) networks
for the largest private payers in the market, ETMC finally settled
with the insurers and signed a multi-year agreement in August 2016
with Blue Cross. In the couple of years preceding these agreements,
ETMC was challenged by the financial constraints caused by rising
deductibles for out-of-network care, decreasing out-of-network
reimbursement from the payors, and increasing pressure to refer
non-emergent procedures to network providers.
Fitch viewed the new PPO contracts as a key credit development as
it resolved a long-period of uncertainty for the hospital's patient
base and ETMC's financial future. Despite the favorable
arrangements, however, the contracts did not yield the expected
benefit due to other market changes that had started to occur at
the same time. ETMC joined Blue Cross' PPO network just as Blue
Cross was no longer offering the product to small employers and
business was shifting to the less lucrative HMO product available
on the exchange. Additionally, CHRISTUS Health's acquisition of TMF
made that provider a stronger competitor, further limiting ETMC's
ability to re-divert market share.
Rural Hospitals
ETMC has also continued to be challenged by the low utilization and
financial losses incurred by its network of small rural hospitals.
The Tyler hospital benefits from high- acuity referrals from these
hospitals but not enough to offset the fixed costs at these
facilities and the number of employed physicians needed to maintain
access and medical services to underserved areas.
ETMC and its rural hospitals rely heavily on the Texas waiver 1115
program for supplemental funding to offset some of these
challenges. However, ETMC's funding decreased significantly in
fiscal 2017 to $15 million from the higher levels in fiscal years
2015 and 2016 as the state is currently recouping prior years'
funding. The clawback is the result of a CMS audit that discovered
that rural hospitals in Texas were receiving reimbursement over the
permitted hospital cap limit. ETMC anticipates reimbursement of $18
million from the program in future years if it is extended past the
current December 2017 termination date.
EMS Division
ETMC's ambulance service division, Paramedics Plus, provides
ambulance services in and outside of Texas. In early 2017, the
Department of Justice alleged that ETMC participated in a more than
$20 million kickback scheme to obtain a public ambulance contract
in Oklahoma. The lawsuit is pending, but meanwhile ETMC is seeking
a buyer for Paramedics Plus. The division has approximately $116
million in net revenue and 800 employees. Depending on several
factors, there is a possibility that the sale of the EMS division
before the end of the fiscal year may generate a gain to prevent an
event of default from non-compliance with the rate covenant that is
otherwise expected to occur.
Acquisition Partner
ETMC has announced that it is searching for an acquisition partner
given the challenges that it faces as an independent small regional
system. The system expects to sign a letter of intent in the fall
of 2017 in anticipation of closing the deal in the first quarter of
calendar 2018. Management's early expectation is that the bonds
would be refunded at the time of an acquisition. Otherwise, the
system may be pressured by a possible event of default on the bonds
and further deterioration of its financial position.
Weakened Financial Profile
Financial results deteriorated in the current six month period with
a negative 9% operating margin and negative 1.2% operating EBITDA
margin, as compared to a negative 0.7% operating margin and 7%
operating EBITDA in the comparable period in 2016. Pressure
persists with continued dilutive performance at the rural
hospitals, decreased supplemental funding and increased competition
in Tyler.
Cash decreased in the six-month period as well, partly due to
ongoing losses but also due to early repayment of capital leases
that have been placed in a trust. Cash to debt of 65% is still
above the 50.8% median for the below investment grade category.
Debt Profile
Annualized maximum annual debt service (MADS) coverage of negative
0.4x for the six months of fiscal 2016 is calculated using lower
MADS of $26.6 million (reflecting the repayment of capital
leases).
ETMC has a conservative investment and debt profile with all fixed
rate debt. However, the system's pension contributions have been
modest in the past couple of years, and as a result the pension
liability for this frozen plan increased to $44.3 million in fiscal
2016 from $34.3 million in 2015.
EAST WEST COPOLYMER: 2 More Creditors Appointed to Committee
------------------------------------------------------------
The Office of the U.S. Trustee on June 23 appointed two more
creditors to serve on the official committee of unsecured creditors
in the Chapter 11 case of East West Copolymer, LLC.
The two unsecured creditors are:
(1) Thomas M. Allen
P.O. Box 150
Gonzales, LA 70707
Phone: (225) 677-8800
Fax: (225) 673-9286
Email: tallen@tmaen.com
(2) Americas Styrenics, LLC,
Attn: Carolina Cirilo
24 Waterway Ave., Suite 1200
The Woodlands, TX 77380
Phone: (832) 616-7874
Email: ccirilo@amsty.com
-- and --
Attn: Joseph Buoni
Andrews Kurth Kenyon, LLP
600 Travis, Suite 4200
Houston, TX 77002
Phone: (713) 220-4168
Fax: (713) 220-4285
Email: josephbuoni@andrewskurth.com
The trustee had earlier appointed Star Service Inc. of Baton Rouge,
Alberty & Blakeney LLC, and Estes Refractory & Insulation of
Louisiana Inc., court filings show.
About East West Copolymer LLC
East West Copolymer, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. M.D. La. Case No. 17-10327) on April 7, 2017. In its
petition, the Debtor estimated $1 million to $10 million in assets
and $10 million to $50 million in liabilities. The petition
was signed by Gregory Nelson, manager.
Stewart Robbins & Brown, LLC represents the Debtor as counsel.
On May 4, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee hired
Taylor, Porter, Brooks & Phillips LLP as bankruptcy counsel.
ECOARK HOLDINGS: Stockholders Elected Eight Directors
-----------------------------------------------------
The 2017 annual meeting of stockholders of Ecoark Holdings, Inc.,
was held virtually on June 13, 2017, at which the stockholders:
(1) elected Randy S. May, John P. Cahill, Susan M. Chambers,
Terrence D. Matthews, Peter Mehring, Gary Metzger, Steven
K. Nelson and Charles Rateliff to the Company's Board of
Directors;
(2) approved the Ecoark Holdings, Inc. 2017 Omnibus Incentive
Plan;
(3) approved a non-binding advisory resolution approving the
compensation of the Company's named executive officers;
(4) recommended, on an advisory non-binding basis, that the
Company hold future advisory votes to approve the
compensation of the Company's named executive officers
every year; and
(5) ratified the appointment of KBL, LLP as the Company's
independent registered public accounting firm for the
fiscal year ending March 31, 2018.
The Company has considered the outcome of this advisory vote and
has determined, as was recommended by the Company's Board of
Directors in the Proxy Statement, that the Company will hold future
say-on-pay votes on an annual basis until the occurrence of the
next advisory vote on the frequency of say-on-pay votes. The next
advisory vote regarding the frequency of say-on-pay votes is
required to occur no later than the Company's 2023 annual meeting
of stockholders.
About Ecoark Holdings
Ecoark Holdings, Inc., is a technology solutions company. The
Company offers technologies to fight waste in operations,
logistics, and supply chains worldwide. It provides pallet-level
time and temperature tracking, pre-cool prioritization and
monitoring, pallet routing, real-time in-transit monitoring, remote
visibility, and quality management solutions.
Ecoark reported a net loss of $25.23 million on $14.40 million of
revenues for the year ended Dec. 31, 2016, compared to a net loss
of $10.47 million on $7.67 million of revenues for the year ended
Dec. 31, 2015.
As of March 31, 2017, Ecoark had $20.24 million in total assets,
$5.40 million in total liabilities, and $14.83 million in total
stockholders' equity.
KBL, LLP, in New York, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2016, citing that the Company has incurred substantial losses and
needs to obtain additional financing to continue the development of
their products. The lack of profitable operations raises
substantial doubt about the Company's ability to continue as a
going concern.
EL CANO DEVELOPMENT: Taps Mignucci as Special Counsel
-----------------------------------------------------
El Cano Development Inc. seeks approval from the U.S. Bankruptcy
Court for the District of Puerto Rico to hire the Law Offices of
Ruben T. Nigaglioni Mignucci and Eduardo C. Berrios Falcon as
special counsel.
The firm will represent the Debtor in its lawsuit against Sucesion
Gloria Flores Amy, a creditor, in Ponce Superior Court.
Messrs. Mignucci and Falcon will charge $300 per hour and $150 per
hour, respectively.
In a court filing, Mr. Mignucci disclosed that he does not
represent any interest adverse to the Debtor or its bankruptcy
estate.
The firm can be reached through:
Ruben T. Nigaglioni Mignucci, Esq.
Law Offices of Ruben T. Nigaglioni Mignucci
and Eduardo C. Berrios Falcon
255 Recinto Sur, Second Floor
Old San Juan, P.R. 00901
Tel: 787-765-9966
Fax: 787-751-2520
Email: rth@nigaglionilaw.com
About El Cano Development
El Cano Development Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.P.R. Case No. 16-08122) on October 11,
2016. The petition was signed by Adrian J. Hilera Vidal,
president. At the time of the filing, the Debtor estimated assets
of less than $1 million and liabilities of less than $500,000.
Modesto Bigas Law Office is the Debtor's bankruptcy counsel.
EMAS CHIYODA: Needs Time to File Plan, End Non-Reorganizing Cases
-----------------------------------------------------------------
EMAS CHIYODA Subsea Limited, and its debtor-affiliates request the
U.S. Bankruptcy Court for the Southern District of Texas to extend
by 60 days the periods within which only the Debtors may file and
solicit acceptances of a chapter 11 plan, through and including
August 28, 20176 and October 25, 2017, respectively.
While they have made substantial progress on aggressive timeframes,
the Debtors request a modest extension of the Exclusivity Periods
to allow them additional time to confirm the Plan in an orderly
fashion. The Debtors assert that they also require additional time
to effectuate the resolution of the Chapter 11 Cases with respect
to Non-Reorganizing Debtors -- they are still considering how to
wind-down the Non-Reorganizing Debtors most effectively -- whether
by conversion to chapter 7, dismissal, or filing of a separate plan
of reorganization or liquidation.
Unless extended, the Debtors' Plan Period and Solicitation Period
will expire on June 27, 2017 and August 28, 2017, respectively.
Certain of the Debtors filed their Joint Chapter 11 Plan of
Reorganization and Disclosure Statement on May 6, 2017. The Plan
Debtors consist of: EMAS CHIYODA Subsea Inc.; EMAS CHIYODA Subsea
Services Pte. Ltd.; EMAS-AMC Pte. Ltd.; EMAS Saudi Arabia Ltd.;
EMAS CHIYODA Subsea Marine Base LLC; Lewek Falcon Shipping Pte.
Ltd.; and Lewek Constellation Pte. Ltd.
Subsequently, the Plan Debtors filed their Third Amended Joint
Chapter 11 Plan and Third Amended Disclosure Statement on May 24,
2017. The Court on May 25 entered an order approving the adequacy
of the Disclosure Statement. A hearing on confirmation of the Plan
is currently set for June 29 at 9:00 a.m. prevailing Central Time.
In addition, the Debtors tell the Court that they have continued to
engage constructively with their key stakeholders to address their
principal restructuring objectives. To this end, the Plan Debtors
and certain key constituents entered into a Plan Support Agreement.
Under the Plan Support Agreement, the Plan Support Parties (which
consist of many of the Debtors' largest creditors) agree to support
the Plan.
About EMAS CHIYODA Subsea Ltd
EMAS CHIYODA Subsea Limited is an international heavy lift subsea,
offshore and onshore contractor offering engineering, procurement,
construction, transportation, installation, and commissioning
services at every stage of the project lifecycle to deliver complex
construction projects for customers.
EMAS CHIYODA Subsea Limited and its affiliates filed voluntary
Chapter 11 petitions (Bankr. S.D. Tex. Lead Case No. 17-31146) on
Feb. 27, 2017.
The Debtors estimated assets of $500 million to $1 billion and
liabilities between $100 million and $500 million.
The cases are assigned to Judge Marvin Isgur.
The Debtors' bankruptcy counsel are George N. Panagakis, Esq.,
Justin M. Winerman, Esq., and Roy Leaf, Esq., at Skadden, Arps,
Slate, Meagher & Flom LLP, in Chicago, Illinois; Dominic McCahill,
Esq., and Kathlene Burke, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in London.
The Debtors' co-counsel are John F. Higgins, Esq., Joshua W.
Wolfshohl, Esq., Aaron J. Power, Esq., Brandon J. Tittle, Esq., and
Eric M. English, Esq., at Porter Hedges LLP, in Houston, Texas.
The Debtors' managerial service provider is KPMG Services PTE. LTD.
The Debtors' claims and noticing agent is Epiq Bankruptcy
Solutions, LLC. WongPartnership LLP, is the Debtors' special
Singapore counsel.
Judy A. Robbins, the U.S. Trustee for Region 7, on March 21
appointed five creditors of EMAS CHIYODA Subsea Limited, et al., to
serve on the official committee of unsecured creditors. Akin Gump
Strauss Hauer & Feld LLP serves as the Committee's counsel. Alvarez
& Marsal North America, LLC, serves as the Committee's financial
advisors.
ESTHEDONTICS INC: Life Investors Office Park Up for July 25 Sale
----------------------------------------------------------------
As a result of the judgment rendered in the case, Plaintiff
Acquired Capital II, L.P. v. Defendant John R. Doubet,
Esthedontics, Inc., jointly and severally/John R. Doubet,
Esthedontics, Inc., Mary Theresa Doubet, Linn County Iowa District
Court, Case No. EQCV086684, an execution was issued by the clerk of
court to the Sheriff of Linn County. The execution ordered the
sale of the defendant's real estate to satisfy the judgment.
The property to be sold consists of:
-- all that part of Lot 4, Life Investors Office Park Third
Addition to Cedar Rapids, Iowa
-- Lot 5, Life Investors Office Park Third Addition to Cedar
Rapids, Iowa. (3800 River, Ridge Dr. NE, Cedar Rapids, IA
52402)
The property will be offered for sale at public auction for cash on
July 25, 2017, at 10:00 a.m.
The sale will be held at:
Sheriff's Office
310 2nd Avenue SW
Cedar Rapids, Iowa
This sale is not subject to redemption.
The Judgment amount is $1,010,963.85.
Plaintiff's Attorney:
Adam D. Otto, Esq.
Tel: 641-792-7000
FANSTEEL INC: Taps Landis Rath as Special Counsel
-------------------------------------------------
Fansteel, Inc. received approval from the U.S. Bankruptcy Court for
the Southern District of Iowa to hire Landis Rath & Cobb, LLP as
special counsel.
The firm will assist the Debtor in reopening its previous
bankruptcy case filed in Delaware (Bankr. D. Del. Case No.
02-10109) on January 15, 2002, in order to correct the legal
description on its special warranty deed given to FMRI in 2004
regarding the Muskogee site, pursuant to the Order confirming the
Amended Joint Reorganization Plan of Fansteel and its subsidiaries.
That Plan was confirmed in an Order dated November 17, 2003.
Landis will receive a retainer in the amount of $5,000 for its
services.
Landis was Delaware counsel to the official committee of unsecured
creditors in the Fansteel I case, which representation ended over a
decade ago. Kerri K. Mumford, Esq., tells the Court that Landis
has no connection with creditors or other parties in interest in
the present case, its respective attorneys and accountants, the
United States Trustee, or any person employed in the office of the
United States Trustee, and represents no interest adverse to the
Debtor or the estate in matters upon which it is to be engaged.
Landis is a disinterested person within the meaning of Bankruptcy
Code Section 101(14), and its employment would be in the best
interest of the estate.
Landis can be reached through:
Kerri K. Mumford, Esq.
Landis Rath & Cobb, LLP
919 Market Street, Suite 1800
P.O. Box 2087
Wilmington, DE 19899
Direct Dial: (302)467-4414
Email: mumford@lrclaw.com
About Fansteel and Affiliates
Headquartered in Creston, Iowa, Fansteel, Inc., 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. Wellman Dynamics Corporation contributed 67% of Fansteel's
sales. The rest of the sales are generated from Intercast, a
division of Fansteel, and other non-debtor subsidiaries.
Fansteel, Inc., Wellman Dynamics Corporation, and Wellman Dynamics
Machinery & Assembly, Inc., filed Chapter 11 petitions (Bankr. S.D.
Iowa Case Nos. 16-01823, 16-01825 and 16-01827) on Sept. 13, 2016.
The petitions were signed by Jim Mahoney, CEO. The cases are
assigned to Judge Anita L. Shodeen. The Debtors disclosed total
assets of $32.9 million and total debt of $41.97 million.
The Debtors tapped Jeffrey D. Goetz, Esq., and Krystal R.
Mikkilineni, Esq., at Bradshaw, Fowler, Proctor & Fairgrave, P.C.,
as counsel; RSM US LLP as tax advisor; Jeffrey Sands and Dorset
Partners, LLC as business broker; and Mark J. Steger, Esq. at the
Clark Hill Law Firm as Environmental Counsel.
The Debtors filed motions to jointly administer the cases pursuant
to Bankruptcy Rule 1015(b), and the Court entered an Order
authorizing joint administration on Oct. 17, 2016. The Court
subsequently entered an Order on May 24, 2017 vacating its prior
Order granting joint administration and discontinuing the joint
administration of the Debtors' cases under the lead case of
Fansteel.
The U.S. Trustee for Region 12 on Sept. 23, 2016, appointed nine
creditors of Fansteel Inc. to serve on the official committee of
unsecured creditors. The Official Committee retained Morris
Anderson & Associates, Ltd., as financial advisor, and Archer &
Greiner, P.C. and Nyemaster Goode, P.C., as counsel.
Subsequently, the U.S. trustee for Region 12 announced that the
nine-member unsecured creditors' committee would no longer serve as
the official committee in the company's Chapter 11 case. The
bankruptcy watchdog said the panel will be reconstituted as the
official committee of unsecured creditors in the Chapter 11 cases
of Wellman Dynamics Corp. and Wellman Dynamics Machinery &
Assembly, Inc. In a filing on March 22, 2017, the U.S. trustee
disclosed that a new creditors' committee has not yet been
appointed in Fansteel's bankruptcy case.
FEDERAL-MOGUL LLC: Moody's Rates new EUR300MM Senior Sec. Notes B1
------------------------------------------------------------------
Moody's Investors Service assigned B1 ratings to Federal-Mogul
LLC's new senior secured notes. The new notes are expected to be
used to refinance, in like amount, a portion of the senior secured
tranche C term loan and pay related fees and expenses, borrowed by
Federal-Mogul Holdings LLC (Assumed by Federal-Mogul LLC).
Rating Assigned:
Federal-Mogul LLC
B1 (LGD3), to the new EUR300 million Euro senior secured
fixed-rate notes, due 2024
RATINGS RATIONALE
The transaction will extend certain debt maturity amounts by three
years. The transaction further favorably addresses Federal-Mogul
debt maturity profile following the company's recent note offerings
completed in March 2017. The earlier note offering also refinanced
and extended debt maturities, and eliminated the springing feature
under the asset based revolver. Federal-Mogul continues to make
progress on improving profitability levels resulting for
restructuring and profit improvement actions taken in 2016. Yet,
the company revenue growth is expected to be challenged by
plateauing global automotive demand.
Future events that have potential to drive a higher rating include
the continuation of positive operating trends resulting in
EBITA/Interest coverage approaching 2.5x, and Debt/EBITDA leverage
approaching 5.5x.
Future events that have potential to drive Federal-Mogul's ratings
lower include deterioration in automotive industry conditions
without offsetting restructuring actions; or lower profitability
resulting from market share losses, pricing pressure or material
increases in raw materials costs that cannot be passed on to
customers. Consideration for a lower rating could arise if any
combination of these factors were to result in EBITA/Interest
coverage approaching 1.0x or debt/EBITDA being sustained above
6.5x. Liquidity deterioration could also lead to a downgrade.
The principal methodology used in this rating was the Global
Automotive Supplier Industry published in June 2016.
Federal-Mogul LLC, headquartered in Southfield, MI is a leading
global supplier of products and services to the world's
manufacturers and servicers of vehicles and equipment in the
automotive, light, medium and heavy-duty commercial, marine, rail,
aerospace, power generation and industrial markets. The company's
products and services enable improved fuel economy, reduced
emissions and enhanced vehicle safety. Federal-Mogul is controlled
by affiliates of Icahn Enterprises L.P. Revenues in fiscal 2016
were $7.4 billion.
FEDERAL-MOGUL LLC: S&P Rates New EUR300MM Sec. Notes 'B-'
---------------------------------------------------------
S&P Global Ratings assigned its 'B-' issue-level rating and '4'
recovery rating to Michigan-based Federal-Mogul LLC's proposed
EUR300 million fixed-rate senior secured notes due 2024.
Federal-Mogul Financing Corp. is a co-issuer of these notes. The
'4' recovery rating indicates S&P's expectation for average
(30%-50%; rounded estimate: 40%) recovery for secured lenders in
the event of a payment default.
The company plans to use the proceeds from this offering to repay
part of its tranche C term loan due 2021 and pay associated fees
and expenses.
The proposed notes will rank pari passu in right of payment with
all of Federal-Mogul's existing and future senior indebtedness and
will have access to the same collateral as the company's term loan
facility.
All of S&P's other ratings on Federal-Mogul, including S&P's 'B-'
corporate credit rating, remain unchanged.
RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario anticipates a default in
2019 caused by reduced demand for Federal-Mogul's products
due to renewed economic weakness in the U.S. and Europe.
This scenario also envisions that the company's original
equipment manufacturing and aftermarket channels remain
highly competitive and commodity prices continue to
escalate. S&P expects that these conditions will reduce the
company's volumes, revenues, gross margins, and net income,
causing its liquidity to decline.
Simulated default assumptions
-- Simulated year of default: 2019
-- EBITDA at emergence: $450 million
-- EBITDA multiple: 4.5x
-- LIBOR and Euribor rise to 250 basis points
-- Asset-based lending facility is 60% drawn
Simplified waterfall
-- Net enterprise value after admin. expenses (5%): $1.922
billion
-- Obligor/nonobligor valuation split: 30%/70%
-- Estimated priority claims: $402 million
-- Collateral value available to secured debt: $840 million
-- Estimated first-lien claim: $2.650 billion
-- Recovery range: 30%-50% (rounded estimate: 40%)
Note: All debt amounts include six months of prepetition interest.
Collateral value equals asset pledge from obligors after priority
claims plus equity pledge from nonobligors after nonobligor debt.
RATINGS LIST
New Ratings
Federal-Mogul LLC
Federal-Mogul Financing Corporation
Senior Secured
EUR300M Fixed-Rate Nts Due 2024 B-
Recovery Rating 4(40%)
FINJAN HOLDINGS: Secures $15.3M Series A-1 Pref. Stock Financing
----------------------------------------------------------------
Finjan Holdings, Inc., has secured a $15.3 million Series A-1
Preferred Stock financing in a private placement transaction led by
Soryn HLDR Vehicle II LLC. Soryn HLDR was set up by Halcyon Long
Duration Recoveries Management LP and its affiliates in partnership
with Soryn Capital, LLC, an affiliate of Soryn IP Group, LLC.
Finjan will issue 153,000 shares of Series A-1 Preferred Stock at a
price of $100 per share to Soryn HLDR. In connection with this
transaction, the company will also issue to Soryn HLDR warrants to
purchase two million shares of common stock at an exercise price of
$3.18 per common share.
The Series A-1 Preferred Stock contains certain optional and
mandatory redemptive provisions, does not accrue an annual cash
dividend, and carries participation rights in certain of the
Company's revenue streams until securities are retired. More
complete information regarding the financing is included in a Form
8-K which was filed by Finjan with the Securities and Exchange
Commission on June 20, 2017, a copy of which is available for free
at https://is.gd/xM6Oph
"This second financing with our Soryn and Halcyon partners
represents an important milestone as they have grown to appreciate
not only the value of Finjan's patent portfolio but our ability to
execute against our strategic objectives," said Phil Hartstein,
president and CEO of Finjan Holdings. "We redeemed and retired
shares issued in the first financing in less than one year, our
balance sheet is well-infused with cash, and we continue to carry
no debt. As was the case in the first transaction, these new
funds, which were received on June 19, offer us additional security
to operate our business, pursue licensing at an accelerated rate
and the flexibility to explore both organic and inorganic paths
towards future growth."
"We are looking forward to this next stage of our relationship with
Finjan, a company with a rich history in cybersecurity, which has
also led the way in pioneering licensing best practices," commented
Michael Gulliford, the founder & managing principal of Soryn. "In
the past year, Finjan has achieved a cadence of new licensees,
multiple settlements, several new updates to its platform and a
promising partnership for its Mobile security business. We are
proud to continue standing behind a true innovator in the
cybersecurity space."
B. Riley & Company, LLC acted as placement agent for the
transaction.
The Series A-1 Preferred shares have not been registered under the
United States Securities Act of 1933 and may not be offered or sold
in the United States absent registration or an applicable exemption
from registration requirements.
About SORYN HLDR
Soryn HLDR was set up by Halcyon Long Duration Recoveries
Management LP and its affiliates in partnership with Soryn Capital,
LLC, an affiliate of Soryn IP Group, LLC, (www.sorynipgroup.com) a
patent advisory and finance firm headquartered in New York City.
About Finjan
Established nearly 20 years ago, Finjan is a globally recognized
leader in cybersecurity. Finjan's inventions are embedded within a
strong portfolio of patents focusing on software and hardware
technologies capable of proactively detecting previously unknown
and emerging threats on a real-time, behavior-based basis. Finjan
continues to grow through investments in innovation, strategic
acquisitions, and partnerships promoting economic advancement and
job creation. For more information, please visit www.finjan.com.
Finjan reported a net loss attributable to common stockholders of
$6.43 million for the year ended Dec. 31, 2016, compared to a net
loss attributable to common stockholders of $12.60 million for the
year ended Dec. 31, 2015. As of March 31, 2017, Finjan had $29.85
million in total assets, $6.54 million in total liabilities, $6.26
million in series A preferred stock and $17.04 million in total
stockholders' equity.
FIRSTRAIN INC: Hires JND Corporate as Noticing Agent
----------------------------------------------------
FirstRain, Inc. seeks authorization from the U.S. Bankruptcy Court
for the District of Delaware to employ JND Corporate Restructuring
as claims, noticing and balloting agent, nunc pro tunc to the June
5, 2017 petition date.
The Debtor requires JND Corporate to provide these services:
(a) preparing and serving required notices in the Chapter 11
Case, including:
-- notice of the commencement of the Chapter 11 Case and
the initial meeting of creditors under Bankruptcy Code
section 341(a);
-- a notice of the claims bar date;
-- notices of objections to claims and objections to
transfers of claims;
-- notices of hearings on motions filed by the Office of
the United States Trustee for the District of Delaware;
-- notices of transfers of claims;
-- notices of any hearings on a disclosure statement and
confirmation of the Debtor's plan or plans of
reorganization; and
-- such other miscellaneous notices as the Debtor or Court
may deem necessary or appropriate for an orderly
administration of the Chapter 11 Case.
(b) within seven days after the mailing of a particular notice,
filing with the Court a copy of the notice served with a
certificate of service attached indicating the name and
complete address of each party served;
(c) receiving, examining, and maintaining copies of all proofs
of claim and proofs of interest filed in the Chapter 11
Case;
(d) maintaining official claims registers in the Chapter 11
Case by docketing all proofs of claim and proofs of
interest in a claims database that includes the following
information for each such claim or interest asserted:
-- the name and address of the claimant or interest holder
and any agent thereof, if the proof of claim or proof of
interest was filed by an agent;
-- the date the proof of claim or proof of interest was
received by Agent and/or the Court;
-- the claim number assigned to the proof of claim or proof
of interest;
-- the asserted amount and classification of the claim; and
-- if applicable, the specific Debtor against which the
claim or interest is asserted.
(e) recording all transfers of claims pursuant to Bankruptcy
Rule 3001(e);
(f) revising the creditor matrix after the objection period
expires;
(g) recording any order entered by the Court which may affect a
claim by making a notation on the claims register;
(h) monitoring the Court's docket for any claims related
pleading filed and making necessary notations on the claims
register;
(i) maintaining a separate claims register for each debtor if
the Chapter 11 Case are jointly administered;
(j) filing a quarterly updated claims register with the Court
in alphabetical and numerical order. If there was no claims
activity, a certification of no claim activity may be
filed;
(k) maintaining an up-to-date mailing list of all creditors and
all entities who have filed proofs of claim or proofs of
interest and/or request for notices in the case and
providing such list to the Court or any interested party
upon request;
(l) providing access to the public for examination of claims
and the claims register at no charge;
(m) forwarding all claims, an updated claims register and an
updated mailing list to the Court within 10 days of entry
of an order converting a case or within 30 days of entry of
a final decree. The claims register and mailing list will
be provided in both paper and on disc and in alphabetical
and numerical order. The mailing list disc will be in .txt
format;
(n) implementing necessary security measures to ensure the
completeness and integrity of the claims registers;
(o) complying with applicable federal, state, municipal, and
local statutes, ordinances, rules, regulations, orders and
other requirements;
(p) providing temporary employees to process claims as
necessary;
(q) promptly complying with such further conditions and
requirements as the Clerk's Office or the Court may at any
time prescribe; and
(r) providing such other claims processing, noticing, and
administrative services as may be requested from time to
time by the Debtor.
JND Corporate will be paid on an hourly rate:
Clerical $35-$45
Case Assistant $65-$85
IT Manager $75-$95
Case Consultant $85-$135
Sr. Case Consultant $145-$165
Case Director $175-$195
JND Corporate will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Prior to the Petition Date, the Debtor paid JND Corporate a
retainer of $5,000.
Travis K. Vandell, chief executive officer of JND Corporate,
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 Debtor and its estate.
JND Corporate can be reached at:
Travis K. Vandell
JND Corporate Restructuring
8269 E. 23rd Ave, Suite 275
Denver, CO 80238
Tel: (855) 812-6112
E-mail: travis.vandell@JNDLA.com
About FirstRain Inc.
Headquartered in San Mateo, California, FirstRain, Inc. --
http://www.firstrain.com/-- is an enterprise software company
whose core IP is in data science and software algorithms that can
discover, read, discern and summarize useful insights about
companies and markets from a vast universe of content across the
global web and social media. FirstRain offers marketing, sales,
financial, and enterprise intelligence and integration services to
customers in the United States and India. FirstRain Inc. has a
wholly owned subsidiary in India, FirstRain Software Centre Private
Limited ("FirstRain India"), that provides support and development
services to the Debtor (its sole customer) on a cost plus basis.
FirstRain, Inc. filed a Chapter 11 bankruptcy petition (Bankr. D.
Del. Case No. 17-11249) on June 5, 2017. Vivie Lee, chief
executive officer, signed the petition. At the time of the filing,
the Debtor estimated its assets and liabilities at $1 million to
$10 million.
The Hon. Laurie Selber Silverstein is the case judge.
The Debtor tapped Wilson Sonsini Goodrich & Rosati, PC, as
corporate counsel, and JND Corporate Restructuring as claims and
noticing agent.
On June 5, 2017, the Debtor filed a disclosure statement, which
explains its proposed Chapter 11 plan of reorganization.
FLORIDA ORGANIC: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Florida Organic Aquaculture,
LLC, as of June 22, 2017, according to a court docket.
About Florida Organic Aquaculture
Based in Jupiter, Florida, Florida Organic Aquaculture, LLC, is
engaged in shrimp cultivation using energy-efficient and
sustainable aquaculture techniques. Florida Organic Aquaculture
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Fla. Case No. 17-15012) on April 24, 2017. The petition was
signed by Clifford Morris, managing member.
Malinda L. Hayes, Esq., at Markarian Frank & Hayes serves as the
Debtor's bankruptcy counsel.
The case is assigned to Judge Erik P. Kimball.
At the time of the filing, the Debtor estimated its assets and
debts at $10 million to $50 million.
FOLTS HOME: Seeks to Hire Clark Schaefer as Accountant
------------------------------------------------------
Folts Home and Folts Adult Home, Inc. seek approval from the U.S.
Bankruptcy Court for the Northern District of New York to hire an
accountant.
The Debtors propose to hire Clark, Schaefer, Hackett & Co. to
perform audits of each of their financial operations for the 2016
fiscal year.
The firm will also prepare the Debtors' financial statements and
reports that will be submitted to the Department of Housing and
Urban Development, Centers for Medicare and Medicaid Services and
the State of New York Department of Health.
Clark Schaefer will receive $27,500 from Folts Home, and $13,250
from Folts Adult Home for its services.
Kevin Allmandinger, principal of Clark Schaefer, 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:
Kevin E. Allmandinger
Clark, Schaefer, Hackett & Co.
4449 Easton Way, Suite 400
Columbus, OH 43219
Phone: 614-885-2208
Toll Free: 800-381-2684
Fax: 614-885-8159
About Folts Home
Folts Home is a New York not-for-profit corporation and the owner
of a 163-bed long-term residential health care and rehabilitation
facility located at 100-122 North Washington Street, Herkimer, New
York. In addition to long-term skilled nursing and residential
care, Folts Home provides memory care to residents with dementia,
palliative care and respite care and operates an adult day care
program. Folts Home also offers rehabilitation services, such as
physical, occupational and speech therapy, on both inpatient and
out-patient bases.
Folts Adult Home, Inc., also known as Folts-Claxton, is a
New York not-for-profit corporation and the owner of an 80-bed
adult residential center that was constructed in 1998 and is
located at 104 North Washington Street, Herkimer, New York. FAH
residents reside in separate apartments and are provided services
such as daily meals, laundry, housekeeping and medication
assistance.
Folts Home and Folts Adult Home, Inc., filed separate, voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code
(Bankr. N.D.N.Y. Case Nos. 17-60139 and 17-60140, respectively) on
Feb. 16, 2017. The cases are jointly administered. The petitions
were signed by Dr. Anthony E. Piana, chairman, Board of Directors.
At the time of filing, Folts Home listed assets and liabilities
between $10 million and $50 million.
The cases are assigned to Judge Diane Davis. The Debtors tapped
Stephen A. Donato, Esq. and Camille Wolnik Hill, Esq. at Bond,
Schoeneck & King, PLLC, as counsel; and CohnReznick Capital Markets
Securities, LLC as investment banker.
The Debtors, through duly-appointed receivers HomeLife at Folts,
LLC, and HomeLife at Folts-Claxton, LLC, continue to operate their
skilled nursing home and adult residence businesses, respectively,
and manage their properties as debtors-in-possession. The
receivers tapped Koch & Schmidt, LLC, and Hancock Estabrook, LLP,
as professionals to advise them during the pendency of the Chapter
11 cases.
The U.S. Trustee for Region 2, appointed Krystal Wheatley as
patient care ombudsman for the Debtors.
FORESIGHT ENERGY: Bank Debt Trades at 5% Off
--------------------------------------------
Participations in a syndicated loan under Foresight Energy is a
borrower traded in the secondary market at 95.48
cents-on-the-dollar during the week ended Friday, June 16, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents an increase of 0.40 percentage points from the
previous week. Foresight Energy pays 575 basis points above LIBOR
to borrow under the $0.825 billion facility. The bank loan matures
on March 7, 2022 and carries Moody's B2 rating and Standard &
Poor's B rating. The loan is one of the biggest gainers and losers
among 247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended June 16.
GANDER MOUNTAIN: Needs More Time to Review Leases & File Plan
-------------------------------------------------------------
Gander Mountain Company and Overton's, Inc. request the U.S.
Bankruptcy Court for the District of Minnesota to extend exclusive
periods in which only the Debtors may file a plan of reorganization
through October 31, 2017, and obtain acceptances of such plan
through December 31, 2017.
The Court will hold a hearing on the Debtors' Motion on July 5,
2017 at 1:30 p.m. Any response to the Motion must be filed and
served not later than June 30, 2017.
The Debtors' counsel have discussed the requested extension with
the counsel for the Official Committee of Unsecured Creditors prior
to filing the Motion. The Debtors believe that the Committee has no
objection to the relief requested.
Currently, the Debtors' exclusive period to file a plan will end on
July 8, 2017, and the exclusive period to obtain acceptances of a
plan will end on September 6.
The Debtors contend that since the commencement of their chapter 11
cases, majority of their time and effort has been devoted to
stabilizing their business operations, completing the transition to
operating as chapter 11 debtors in possession, and pursuing a sale
process on a relatively fast timeline.
The Debtors also contend that they have been required to focus on
the transition to Chapter 11 operations and on developing and
implementing the sale process, which has left little time for
analyzing information and negotiating and preparing a plan of
reorganization.
The Debtors relate that they have closed on the sales of their
assets under the approved Agency Agreement and the Camping World
Asset Purchase Agreement.
The Debtors note that under the Agency Agreement, the going out of
business and store closing sale of Debtor Gander Mountain Company's
merchandise to the public is continuing through August 31, 2017. In
addition, the Debtors note that Camping World has the right under
its Asset Purchase Agreement to designate leases for assumption and
assignment or rejection through and including October 6, 2017, as
stores are released by the Agent from the going out of business
sale.
The Debtors contend that the number of stores that may be assumed
and assigned will not be known for several months. Accordingly, the
Debtors will not be able to have a more accurate estimate of the
amount available to unsecured creditors and the total amount of
unsecured claims until after the going out of business sale is
completed and Camping World has made all or most of its decisions
regarding the leases.
In addition, the Debtors claim that they have received proceeds
from the Camping World APA and at least a portion of the Guarantee
Payment due the Debtors under the Agency Agreement. However, the
precise amount of the Guarantee Payment and other amounts owed by
the Debtor or the Agent under the Agency Agreement is yet to be
determined and finally reconciled, and that process is unfolding
over the next several weeks. The Debtors assert that the final
reconciliation will affect the amount of cash Debtors have
available for distribution under any proposed plan.
Pursuant to the Notice of Chapter 11 Bankruptcy Cases, the last day
for all creditors, including governmental units, to timely file
proofs of claim in this case is July 17, 2017. There have been a
number of claims filed in the case, and the Debtors expect claims
will be filed up to the bar date.
Accordingly, the Debtors assert that they need more time for the
development and analysis of the information necessary to prepare a
disclosure statement and propose a plan. The Debtors claim that the
requested extension will also allow the claims deadline to pass,
which is important to providing the Debtors with additional
information regarding the potential universe of claims.
The Debtors contend that they have commenced work on a plan and
disclosure statement and expect to work closely with the Official
Committee of Unsecured Creditors. Indeed the Committee may be a
co-sponsor of the plan of liquidation.
About Gander Mountain
Gander Mountain Company operates outdoor specialty stores dedicated
for shooting sports, hunting, fishing, camping, marine, apparel,
footwear, and outdoor lifestyle products. Its subsidiary
Overton's, Inc. is a catalog and internet retailer of products for
the recreational boater and other water sports enthusiasts at
http://www.Overtons.com/
Gander Mountain and Overton's Inc. sought protection under Chapter
11 of the Bankruptcy Code (Bankr. D. Minn. Case Nos. 17-30673 and
17-30675) on March 10, 2017. The cases were dointly administered
(Bankr. D. Minn. Lead Case No. 17-30673) The petitions were signed
by Timothy Becker, Executive VP of Lighthouse Management Group,
Inc., as CRO.
The cases are assigned to Judge Michael E. Ridgway.
At the time of the filing, the Debtor estimated its assets and
debts at $500 million to $1 billion.
The Debtors' advisors in the restructuring are Fredrikson & Byron,
PA, which serves as legal counsel; Lighthouse Management Group,
chief restructuring officer; Hilco Real Estate LLC, real estate
advisor; and Faegre Baker Daniels LLP, special corporate counsel.
Donlin, Recano & Company Inc. is the Debtors' claims, noticing and
balloting agent. Houlihan Lokey Capital Inc. serves as the Debtors'
Investment Banker.
On March 13, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee members
are: (1) Ellett Brothers; (2) Carhartt, Inc.; (3) Smith & Wesson
Corp; (4) Pure Fishing, Inc.; (5) Benelli USA; (6) Vista Outdoor
Sales, LLC; (7) National Retail Properties, Inc.; (8) Liberty Safe
and Security Products, Inc.; and (9) DDR Corp.
The Committee hired Jeffrey Cohen, Esq. at Lowenstein Sandler LLP
as its counsel and Connie Lahn, Esq., Christopher Knapp, Esq. and
Roger Maldonado, Esq. at Barnes & Thornburg LLP as co-counsel.
GATEWAY MEDICAL: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 cases of Gateway Medical Center, LLC
and Gateway Medical Center II, LLC as of June 23, according to a
court docket.
About Gateway Medical
Gateway is a Washington limited liability company formed on May 28,
2004. Gateway Medical Center, LLC owns a medical office building
located at 2501 NE 134th St., Vancouver, Washington. It is adjacent
to a medical office building owned by affiliate Gateway Medical
Center II, LLC located at 2621 NE 134th St., Vancouver,
Washington.
Gateway Medical Center, LLC and Gateway Medical Center II, LLC
filed separate Chapter 11 petitions (Bankr. W.D. Wash. Case Nos.
17-41779 and 17-41780, respectively), on May 4, 2017. At the time
of filing, Gateway Medical Center had $1 million to $10 million in
estimated assets and Gateway Medical Center II had $10 million to
$50 million in estimated assets. Both Debtors have liabilities
estimated to be between $1 million to $10 million.
The petitions were signed by Daniel J. Boverman, manager. The cases
are assigned to Judge Brian D Lynch. The Debtor is represented by
Tara J. Schleicher, Esq. at Farleigh Wada Witt.
No trustee or examiner has been appointed.
GIGA-TRONICS INC: Incurs $1.54 Million Net Loss in Fiscal 2017
--------------------------------------------------------------
Giga-Tronics Incorporated filed with the Securities and Exchange
Commission its annual report on Form 10-K reporting a net loss of
$1.54 million on $16.26 million of net sales for the year ended
March 25, 2017, compared to a net loss of $4.10 million on $14.59
million of net sales for the year ended March 26, 2016.
As of March 25, 2017, Giga-Tronics had $9.07 million in total
assets, $7.35 million in total liabilities and $1.72 million in
total shareholders' equity.
The Company has an accumulated deficit of $25.6 million as of March
25, 2017.
The Company has experienced delays in the development of features,
orders, and shipments for the new Advanced Signal Generator. These
delays have significantly contributed to a decrease in working
capital from $1.8 million on March 26, 2016, to $620,000 on March
25, 2017. The new ASG product has now shipped to several
customers, but potential delays in the refinement of features,
longer than anticipated sales cycles, or the ability to efficiently
manufacture the ASG, could significantly contribute to additional
future losses and decreases in working capital.
To help fund operations, the Company relies on advances under the
line of credit with Bridge Bank. The line of credit which expired
on May 7, 2017, was renewed through May 6, 2019. The agreement
includes a subjective acceleration clause, which allows for amounts
due under the facility to become immediately due in the event of a
material adverse change in the Company's business condition
(financial or otherwise), operations, properties or prospects, or
ability to repay the credit based on the lender's judgement. As of
March 25, 2017, the line of credit had a balance of $582,000, and
additional borrowing capacity of $234,000, respectively.
These matters raise substantial doubt as to the Company's ability
to continue as a going concern.
To address these matters, the Company's management has taken
several actions to provide additional liquidity and reduce costs
and expenses going forward.
* In July 2016, Microsource received a $1.9 million non-
recurring engineering order associated with redesigning a
component of its high performance YIG filter used on an
aircraft platform. The Company delivered NRE services for
approximately $884,000 during fiscal 2017 and we expect to
continue such services over the next nine to twelve months.
* On April 27, 2017, the Company entered into a new loan
agreement with PFG. Under the terms of the agreement, PFG
made a term loan to the Company in the principal amount of
$1,500,000, with funding occurring on April 28, 2017. The
loan has a two-year term, with interest only payments for the
term of the loan.
* With the elimination of Giga-tronics Switch, Power Meter,
Amplifier, and Signal Generator legacy product lines
resulting from the Asset Purchase Agreements with Spanawave
and Astronics, the Company has been able to reduce the number
of employees from 71 in fiscal 2016 to 57 in fiscal 2017,
while providing additional cash for operations from the
proceeds of the sales. The Company is also anticipating
reductions in overhead costs by relocating its operations
into a smaller facility beginning in fiscal 2018.
* In May 2017, the Company renewed its accounts receivable line
of credit with Bridge Bank through May 6, 2019.
* In the first quarter of fiscal 2016, the Company's
Microsource business unit also finalized a multiyear $10.0
million YIG Production Order. The Company started shipping
the YIG Production Order in the second quarter of fiscal
2017, and the Company expects to ship the remainder through
fiscal 2020.
* To assist with the upfront purchases of inventory required
for future product deliveries, the Company entered into
advance payment arrangements with certain customers, whereby
the customers reimburse the Company for raw material
purchases prior to the shipment of the finished products.
The Company will continue to seek similar terms in future
agreements with these customers and other customers.
Management said it will continue to review all aspects of the
business in an effort to improve cash flow and reduce costs and
expenses, while continuing to invest, to the extent possible, in
new product development for future revenue streams. Management
will also continue to seek additional working capital through debt,
equity financing or possible product line sales, however there are
no assurances that such financings or sales will be available at
all, or on terms acceptable to the Company.
Cash and cash-equivalents of $1.4 million and $1.3 million at March
25, 2017, and March 26, 2016, respectively, consisted of demand
deposits with a financial institution that is a member of the
Federal Deposit Insurance Corporation (FDIC). At March 25, 2017,
$1.1 million of the Company's demand deposits exceeded FDIC
insurance limits.
A full-text copy of the Form 10-K is available for free at:
https://is.gd/gTvhee
About Giga-Tronics
Headquartered in San Ramon, California, Giga-tronics Incorporated
includes the operations of the Giga-tronics Division and
Microsource Inc. (Microsource), a wholly owned subsidiary.
Giga-tronics Division designs, manufactures and markets the new
Advanced Signal Generator (ASG) for the electronic warfare market,
and switching systems that are used in automatic testing systems
primarily in aerospace, defense and telecommunications.
GIORGIO CAVALLI: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Giorgio Cavalli NY Inc. as of
June 23, according to a court docket.
About Giorgio Cavalli NY Inc.
Giorgio Cavalli NY Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 17-73136) on May 23,
2017, and is represented by Erica T Yitzhak, Esq. Judge Robert E.
Grossman presides over the case.
GK HOLDINGS: S&P Lowers CCR to 'CCC+', Off CreditWatch Negative
---------------------------------------------------------------
S&P Global Ratings lowered its corporate credit rating on
U.S.-based GK Holdings Inc. (Global Knowledge) to 'CCC+' from 'B-'.
At the same time, S&P removed its ratings on the company from
CreditWatch, where S&P placed them with negative implications on
Jan. 13, 2017. The rating outlook is negative.
Additionally, S&P lowered its issue-level rating on the company's
senior secured first-lien debt to 'CCC+' from 'B-'. The '3'
recovery rating remains unchanged, indicating S&P's expectation for
meaningful recovery (50%-70%; rounded estimate: 65%) of principal
in the event of a payment default.
S&P also lowered its issue-level rating on the company's senior
secured second-lien term loan to 'CCC' from 'CCC+'. The '5'
recovery rating remains unchanged, indicating S&P's expectation for
modest recovery (10%-30%; rounded estimate: 15%) of principal in
the event of a payment default.
The negative operating trends affecting Global Knowledge's revenue
growth continued into the quarter ending March 31, 2017, resulting
in leverage increasing to 8.2x. The company's amendment to its
credit agreement increases its first-lien net leverage covenant
cushion to about 9% as of March 31, 2017, reducing the risk of a
covenant breach. However, S&P believes the company's operating
challenges, very high leverage, and minimal free cash flow make its
capital structure unsustainable in the long term. While S&P don't
expect a missed interest or principal payment over the next year,
S&P believes that the company will face significant refinancing
risk as it nears the maturity of its revolver in January 2020 if
its operations don't materially improve.
The negative outlook reflects S&P's expectation that Global
Knowledge's operating performance will continue to face pressure
over the next 12-24 months, free operating cash flow will be
minimal, and liquidity will be thin. The outlook also reflects
S&P's view that further deterioration in the company's operating
performance could lead to its inability to service or refinance its
debt maturities when they come due.
S&P could lower its corporate credit rating on Global Knowledge if
S&P expects an event of default within the next 12 months. This
could occur if operating challenges, such as increased competition
and pricing pressure, result in lower revenues and EBITDA margins
and adversely affect the company's liquidity. S&P could also lower
the rating if it expects that the company would pursue a distressed
exchange.
S&P views an upgrade as unlikely over the next 12 months.
Nevertheless, an upgrade would entail the company demonstrating the
success of its investments in digital initiatives by generating
significant and sustainable organic revenue growth, and improved
EBITDA margins and cash flows, as well as S&P's expectation that it
will be able to consistently generate DCF to debt of above 5%.
GOLDEN MARINA: Exclusivity Periods Extended Through August 22
-------------------------------------------------------------
Judge Donald R. Cassling of the U.S. Bankruptcy Court for the
Northern District of Illinois extended Golden Marina Causeway LLC's
exclusive period for filing and soliciting acceptances to a plan to
August 22, 2017.
The Troubled Company Reporter has previously reported that the
Debtor told the Court that it has engaged in extensive negotiations
with the Anne Marie Barry Trust (its main creditor) over the terms
of a bankruptcy-exit plan, along with Lawrence Fromelius and L.
Fromelius Investments Properties LLC (both of whom are debtors in
their own Chapter 11 cases).
The Debtor claimed that it has filed a negotiated plan and served
the plan and disclosure statement on its creditors and will be
seeking confirmation of the plan at a hearing on June 27, 2017.
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.
Golden Marina Causeway, LLC, based in Downers Grove, Illinois,
filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 16-03587) on
Feb. 5, 2016. The petition was signed by Lawrence D. Fromelius,
manager. The Debtor is represented by Jeffrey K. Paulsen, Esq., at
The Law Office of William J. Factor, Ltd. The Debtor also hired
Nijman Franzetti LLP as special counsel.
Golden Marina's case was assigned to Judge Carol A. Doyle, and
later transferred to the chambers of Judge Donald R. Cassling.
Golden Marina estimated assets and liabilities at $1 million to $10
million at the time of the filing.
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.
Mr. Fromelius is the sole member of Investment Properties. He is
also the sole member of East Greenfield Investors LLC, which in
turn is the sole member of Golden Marina Causeway LLC.
GREAT BASIN: Prices $2.7 Million Registered Offering of Units
-------------------------------------------------------------
Great Basin Scientific, Inc. has priced a registered offering of
8.9 million units consisting of Class A Units and Class B Units at
unit prices of $0.30 and $0.29, respectively. Gross proceeds
before expenses are expected to be approximately $2.7 million.
Each Class A Unit will consist of one share of common stock and one
Series J Warrant. Each Series J Warrant will entitle the holder to
purchase 2.5 shares of common stock at an exercise price of $0.30
per share, and is exercisable immediately for a period of 60 days
following the date of issuance. Class B Units are being offered to
any purchaser whose purchase of Class A Units would result in that
purchaser owning more than 4.99% or 9.99%, at the purchaser's
election, of the Company's issued and outstanding common stock
following consummation of the offering. Each Class B Unit consists
of one pre-funded Series K Warrant and one Series J Warrant. The
Series K Warrants will be exercisable immediately after issuance
and until they are exercised in full thereafter at an exercise
price of $0.30 per share, of which $0.29 per share will be paid at
the closing with $0.01 per share payable upon exercise of the
Series K Warrant.
Roth Capital Partners acted as the exclusive placement agent for
the offering. After placement agent fees and estimated offering
expenses payable by Great Basin, the Company expects to receive net
proceeds from the sale of the units of approximately $2.0 million.
The offering is expected to close on or about June 21, 2017,
subject to customary closing conditions. Great Basin intends to use
the net proceeds of the offering to fund research and development,
for sales and marketing expenses, the redemption of certain notes,
and for general corporate purposes, including working capital.
The units, shares of common stock, Series J Warrants, Series K
Warrants and the shares issuable upon exercise of the Series J
Warrants and Series K Warrants are being offered by Great Basin
Scientific, Inc. pursuant to a registration statement on Form S-1,
as amended (File No. 333-216045) previously filed with and
subsequently declared effective by the U.S. Securities and Exchange
Commission. A final prospectus relating to the offering will be
filed with the SEC and will be available on the SEC’s website at
www.sec.gov.
Copies of the preliminary prospectus relating to this offering may
be obtained from Roth Capital Partners, 888 San Clemente Drive,
Suite 400, Newport Beach, CA 92660, (800) 678-9147 or by accessing
the SEC's website at www.sec.gov.
About Great Basin
West Valley City, Utah-based Great Basin Scientific Inc. is a
molecular diagnostic testing company focused on the development and
commercialization of its patented, molecular diagnostic platform
designed to test for infectious disease, especially
hospital-acquired infections. The Company believes that small to
medium sized hospital laboratories, those under 400 beds, are in
need of simpler and more affordable molecular diagnostic testing
methods. The Company markets a system that combines both
affordability and ease-of-use, when compared to other commercially
available molecular testing methods.
Great Basin Scientific reported a net loss of $89.14 million on
$3.04 million of revenues for the year ended Dec. 31, 2016,
compared to a net loss of $57.89 million on $2.14 million of
revenues for the year ended Dec. 31, 2015.
As of March 31, 2017, Great Basin had $29.24 million in total
assets, $59.10 million in total liabilities and a total
stockholders' deficit of $29.86 million.
The Company's independent accountants, BDO USA, LLP, in Salt Lake
City, Utah, expressed "substantial doubt" about the Company's
ability to continue as a going concern noting that the Company has
incurred substantial losses from operations, has negative
operating cash flows and has a net capital deficiency.
GREENSTAR HOSPITALITY: Voluntary Chapter 11 Case Summary
--------------------------------------------------------
Debtor: Greenstar Hospitality LLC
d/b/a Cabana Motel
10522 SE 211th St.
Kent, WA 98031
About the Debtor: Its principal assets are located at 655 E.
Windsor St. Othello, WA 99344.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-12815
Court: United States Bankruptcy Court
Western District of Washington (Seattle)
Judge: Hon. Timothy W. Dore
Debtor's Counsel: Lamont S. Bossard, Jr., Esq.
IWAMA LAW FIRM
333 5th Ave S
Kent, WA 98032
Tel: 253-520-7671
E-mail: monty@iwamalaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ahmed Fataftah, managing member.
The Debtor has no unsecured creditors.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/wawb17-12815.pdf
GYMBOREE CORP: U.S. Trustee Forms Seven-Member Committee
--------------------------------------------------------
Judy A. Robbins, U.S. Trustee for Region 4, on June 22, 2017,
appointed seven creditors to serve on the official committee of
unsecured creditors in the Chapter 11 case of Gymboree Corp.
The committee members are:
(1) Hansoll Textile
Hansoll Textile Building 268
Songpa-dacro, Songpa-gu
Seoul, Korea
Tel: (822) 3287-8300
Fax: (822) 3287-8220
E-mail: davidpark@hansoll.com
(2) GGP Limited Partnership
110 North Wacker Drive
Chicago, IL 60606
Tel: (312) 960-2707
Fax: (312) 442-6374
E-mail: Julie.minnick@ggp.com
(3) PREIT Services, LLC
200 S. Broad Street
Suite 300
Philadelphia, PA 19102
Tel: (215) 875-0135
E-mail Edward.Thrasher@preit.com
(4) Deutsche Bank Trust Company Americas
100 Plaza One, 6th Floor
Mail Stop: JCY03-0699
Jersey City, New Jersey 07311
Tel: (201) 593-4016
E-mail: Rodney.gaughan@ db.com
(5) Simon Property Group, Inc.
225 W. Washington Street
Indianapolis, IN 46204
Tel: (317) 263-2346
Fax: (317) 263-7901
E-mail: rtucker@simon.com
(6) Hutchin Hill Capital Primary Fund, Ltd.
c/o Hutchin Hill Capital, LP
888 Seventh Avenue
New York, New York 10106
Tel: (212) 757-4490
Fax: (646) 616-2051
E-mail: leagal@hutchinhill.com
(7) Li & Fung Centennial Pte Ltd.
7/F HK Spinners
Industrial Building
Phases I and II
800 Cheung Sha Wan Road
Kowloon, Hong Kong
Tel: (852) 2806-7980
Fax: (852) 3929-1329
E-mail: carmenchau@lfsourcing.com
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at a debtor's
expense. They may investigate the debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.
About The Gymboree Corp.
The Gymboree Corporation is a children apparel retailer in North
America, with 1,291 retail stores as of Jan. 28, 2017 operating
under three brands: Gymboree; Janie & Jack (a higher-end offering
launched in 2002); and Crazy 8 (a value-oriented line launched in
2007). The Company operates online stores at
http://www.gymboree.com/, http://www.janieandjack.com/and
http://www.crazy8.com/
In October 2010, Gymboree was acquired by Bain Capital Private
Equity, LP and certain of its affiliated investment funds or
investment vehicles managed or advised by it -- Sponsor -- for
approximately $1.8 billion.
The Gymboree Corp. and seven affiliates each filed a Chapter 11
voluntary petition (Bankr. E.D. Va. Lead Case No. 17-32986) on June
11, 2017. James A. Mesterharm, chief restructuring officer, signed
the petitions. The cases are pending before the Honorable Keith L.
Phillips.
Gymboree had $755.5 million in assets and $1.36 billion in total
liabilities as of March 14, 2017.
Kirkland & Ellis LLP is the Debtors' bankruptcy counsel. Kutak
Rock LLP is the Debtors' local bankruptcy counsel. Munger, Tolles
& Olson LLP is the Debtors' special counsel. Lazard Freres & Co.
LLC is the investment banker. AlixPartners, LLP, is the
restructuring advisor. Prime Clerk LLC is the claims agent.
Counsel to the Term Loan Agent and the DIP Term Loan Agent are
Milbank, Tweed, Hadley & McCloy LLP; and McGuireWoods LLP.
Rothschild & Co. also serves as advisor to the Term Loan Agent.
Bain Capital Partners is represented by Weil Gotshal & Manges LLP.
Counsel to the DIP ABL Administrative Agent are Morgan, Lewis &
Bockius LLP; and Hunton & Williams LLP.
Counsel to the DIP ABL Term Agent are Choate, Hall & Stewart LLP;
and Whiteford Taylor Preston, LLP.
The indenture trustee for the Debtors' senior unsecured notes is
Deutsche Bank Trust Company Americas.
Counsel to the ad hoc group of senior unsecured noteholders is Akin
Gump Strauss Hauer & Feld LLP.
* * *
The Gymboree Corporation is set to file a Chapter 11 plan of
reorganization that it negotiated with controlling owner Bain
Capital Private Equity, LP, and a majority of its term loan
lenders, prior to the bankruptcy filing.
The Plan will reduce debt by more than $900 million. Secured term
loan lenders owed $788.8 million will exchange their debt for most
of the new common shares of reorganized Gymboree.
Under the Plan, holders of general unsecured claims will not be
entitled to any recovery or distribution under the Plan. Holders
of existing common stock also won't receive anything.
HAMILTON ENGINEERING: HS Buy Steps Down as Member of Committee
--------------------------------------------------------------
HS Buy Van Associates Inc., a creditor of Hamilton Engineering
Inc., is no longer a member of the company's official committee of
unsecured creditors, according to a June 21 court filing.
HS Buy, together with Progressive Metal Manufacturing, Eco Heating
Systems Groningen, B.V. and Leading Edge Sales Corp., was appointed
to serve on the committee by the Office of the U.S. Trustee on June
16.
The committee is now composed of:
(1) Progressive Metal Manufacturing
David P. Laporte, CFO
3100 East Ten Mile Rd.
Warren, MI 48091
Phone: 248-546-2827
Email: dlaporte@pmmco.com
(2) Eco Heating Systems Groningen, B.V.
Marc N. Swanson, Counsel
150 West Jefferson Ave., Ste. 2500
Detroit, MI 48226
Phone: 313-496-7591
Fax: 313-496-8452
Email: swansonm@millercanfield.com
(3) Suzanne Fontana, Leading Edge Sales Corp
John Lange, Counsel
24780 Hathaway St., Ste. 300
Farmington Hills, MI 48335
Phone: 313-815-7477
Fax: 248-478-4026
Email: jlange@glmpc.com
Email: lesmkting@aol.com
About Hamilton Engineering
Founded in 1981, Hamilton Engineering is a family-owned, Livonia,
Michigan based, supplier of specially designed water heating and
building heat applications throughout North and South America.
Hamilton Engineering, Inc. filed a Chapter 11 petition (Bankr. E.D.
Mich. Case No. 17-48381) on June 3, 2017. Christina McIlhenney,
shareholder, signed the petition. At the time of the filing, the
Debtor estimated assets of less than $50,000 and liabilities of $1
million to $10 million.
The case is assigned to Judge Maria L. Oxholm. The Debtor is
represented by Ernest M. Hassan, III, Esq. and Elliot G. Crowder,
Esq. at Stevenson & Bullock, P.L.C.
HAMPSHIRE GROUP: Exclusivity Periods Extended Thru August
---------------------------------------------------------
Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the
District of Delaware on June 21 entered an order extending the
exclusive periods during which only Hampshire Group, Limited, and
its Debtor-affiliates may file a chapter 11 plan of liquidation and
solicit acceptances, through and including June 21, 2017 and August
21, 2017, respectively.
Also on June 21, the Debtors filed yet another motion to extend
their exclusivity periods -- their third such request. The next
day, the Debtors filed a notice of withdrawal of the motion.
The Troubled Company Reporter previously reported that the Debtors
told the Court that 30-day extensions of their Exclusive Periods
will further their efforts to finalize and file the proposed joint
chapter 11 plan, the related disclosure statement, and other
related documents.
The Debtors related that since the filing of the First Extension
Motion, the Debtors and their counsel had been engaged in
extensive, collaborative negotiations and discussions with the
Committee's professionals regarding a proposed joint chapter 11
plan of liquidation, a related disclosure statement, and other
related documents. Among other things, the Debtors and/or their
professionals (a) had negotiated and executed a Plan Term Sheet
with the Committee, (b) had worked with the Committee's
professionals to develop the framework for a draft joint chapter 11
plan of liquidation, and (c) had reviewed, revised and provided
extensive comments to drafts of a proposed joint chapter 11 plan of
liquidation, a related disclosure statement, a draft motion seeking
approval of such disclosure statement on an interim basis and
approval of solicitation procedures, and other related documents.
The Debtors believe that the draft joint chapter 11 plan and
related disclosure statement are in substantially final form,
subject to final review and signoff and any conforming changes, and
certain related documents are in the process of being drafted
and/or finalized for filing in the near future. The Debtors and the
Committee anticipate seeking a combined hearing on the proposed
plan and disclosure statement.
The Debtors mentioned that at the end of March 2017, they had
ceased business operations, closed their remaining offices, and
terminated their remaining staff, with William Drozdowski
continuing to serve as interim Chief Financial Officer of the
Debtors pursuant to a bankruptcy court order. In April 2017, the
Debtors completed the sale of their remaining inventory.
The Debtors also related that the Bankruptcy Court entered an order
on January 30, 2017, establishing March 6, 2017, as the deadline to
file prepetition claims and May 22 as the deadline for governmental
units to file prepetition claims. In addition, the Bankruptcy
Court on May 8 entered an order establishing June 15 as the
deadline by which persons must file applications for allowance of
administrative expense claims that arose between the Petition Date
and April 30, 2017.
About Hampshire Group, Ltd.
New York-based Hampshire Group, Limited (OTC Markets: HAMP) is a
provider of fashion apparel across a broad range of product
categories, channels of distribution and price points. As a holding
company, the Company operates through its wholly-owned
subsidiaries, Hampshire Brands, Inc. and Hampshire International,
LLC.
Hampshire Group, Limited and two affiliates -- Hampshire Brands and
Hampshire International -- sought Chapter 11 bankruptcy protection
(Bankr. D. Del. Case Nos. 16-12634 to 16-12636) on Nov. 23, 2016,
to facilitate the orderly wind-down of their business operations.
The petitions were signed by Paul Buxbaum, president and chief
executive officer.
Hampshire Group disclosed $25.9 million in assets and $41.8 million
in liabilities. Brands listed under $50 million in both assets and
debts. International listed under $50,000 in assets and under $50
million in liabilities.
Louis M. Rappaport, Esq. at Blank Rome LLP represents the Debtors.
William Drozdowski of GRL Capital Advisors LLC has been tapped as
the Debtors' chief financial officer.
The U.S. Trustee for Region 3 has appointed five creditors to serve
in the official unsecured creditors committee in the case.
Pachulski Stang Ziehl & Jones LLP serves as legal counsel and
Gavin/Solmonese LLC as financial advisor to the Committee.
* * *
The Bankruptcy Court authorized Hampshire Group, Limited to sell
certain assets to The Fashion Exchange, LLC pursuant to an asset
purchase agreement dated January 13, 2017. The sold assets
include James Campbell assets. The consideration for the Inventory
on Hand shall be an amount equal to $10.95 multiplied by the number
of items of Inventory on Hand as of the Closing Date. The
consideration for all other Acquired Assets shall be $0.14 million.
Klestadt Winters Jureller Southard & Stevens, LLP served as legal
advisor to the buyer.
HASKELL PROPERTIES: NJ High Court Remands Suit vs. Insurers
-----------------------------------------------------------
Bill Wichert at Bankruptcy Law360 reports that the New Jersey
Supreme court has granted the petitions of insurers Great American
Insurance Co. of New York, et al., for certification and remanded
the lawsuit against them from Haskell Properties LLC in order for
the state's Appellate Division to reconsider its August decision in
light of the Supreme Court's February opinion in Givaudan
Fragrances Corp. v. Aetna Cas. & Sur. Co.
Relying in part on the appellate decision in Givaudan, the
appellate panel in Haskell reversed a trial court's dismissal of
the company's claims related to coverage for occurrences predating
when the business bought the Haskell, New Jersey, property as part
of an asset purchase agreement with General Ceramics Inc. after GCI
had filed for Chapter 11 protection, Law360 points out.
Haskell has asserted that the company is entitled to coverage for
remediation costs from the insurers under policies issued to GCI,
but the insurer defendants have refused to provide such coverage,
arguing in part that the claims could not be assigned to Haskell
without their consent under the policies' so-called
consent-to-assignment clauses, Law360 cites.
Law360 relays that in its its Givaudan opinion, the Supreme Court
adopted the position recognized in Elat and the New Jersey Superior
Court's 1951 decision in Flint Frozen Foods Inc. v. Firemen's
Insurance Co. of Newark -- an anti-assignment clause does not bar
the post-loss assignment of a claim.
The case is Haskell Properties LLC v. American Insurance Co. et
al., case number 078210, in the New Jersey Supreme Court. The
insurer defendants are Great American Insurance Co. of New York,
American Insurance Co., Fireman's Fund Insurance Co., First State
Insurance Co. and St. Paul Fire & Marine Insurance Co.
Haskell Properties, Inc., a real estate agent, filed a Chapter 11
petition (Bankr. M.D.N.C. Case No. 08-80596) in Durham, North
Carolina on April 21, 2008. J. Marshall Shelton, Esq., at Ivey,
McClellan, Gatton & Talcott, LLP, in Greensboro, North Carolina,
serves as counsel. The Debtor estimated $1 million to $10 million
in assets and debt.
HOME CAPITAL: S&P Affirms 'B-' Longterm ICR; Outlook Positive
-------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' long-term issuer credit
ratings and its 'B' short-term issuer credit ratings on Home
Capital Group Inc. (HCG) and Home Trust Ltd., and its 'B-'
issue-level ratings on Home Trust's senior unsecured debt and
certificates of deposit. S&P Global Ratings removed the ratings
from CreditWatch developing, where they had been placed May 2,
2017. The outlook on S&P's long-term ratings is positive.
Since S&P's last rating action on May 2, it has witnessed several
incrementally positive developments regarding the creditworthiness
of HCG. S&P views the combined impact of these as significant, and
expect it to have a positive influence on depositor sentiment
toward HCG.
Late in the evening of June 21, HCG announced an agreement with
Berkshire Hathaway Inc. (BRK) for the latter to: invest up to C$400
million in HCG's common equity; and provide a new C$2 billion
credit facility, via BRK's wholly owned subsidiary Columbia
Insurance Co. (CIC; AA+/Stable/--). HCG expects BRK's equity
investment to come in two tranches. The initial investment, of
about C$153 million (20% stake, post-issuance), is due to close on
June 29, pending approval by the Toronto Stock Exchange (TSX). The
TSX approval is required because the offer is at a 20% discount to
the 20-day volume-weighted average price of the common shares on
the TSX as of the close of trading on
June 21. Assuming the initial investment closes by June 29,
BRK/CIC have committed to make an additional investment in HCG's
common equity, of about C$247 million (resulting in a 38% stake
when combined with initial investment). The additional investment
would require approval by current shareholders, to be decided at a
special shareholders' meeting in September. In addition, the BRK
group has agreed to provide a C$2 billion line of credit facility,
which HCG expects to be effective on June 29. HCG intends to use
this line to replace its existing credit facility, provided by the
Healthcare of Ontario Pension Plan (HOOPP). The BRK facility is on
similar but slightly more-favorable terms, compared with the HOOP
facility: For example, a 9.5% interest rate on balances outstanding
(versus the current 10%), to decrease to 9% after BRK's initial
equity investment; the standby fee on undrawn funds will decrease
to 1.75% (versus 2.50%) and to 1.00% after BRK's initial equity
investment; and no upfront commitment fee. S&P understands the BRK
line is not contingent on the initial equity investment closing.
The onerous rate on this facility, notwithstanding the slight
improvements in terms, still points to weakness in Home Capital's
market position and funding arrangements.
HCG has also announced an agreement, with KingSett Capital, to sell
to the latter about C$1.2 billion of HCG's commercial mortgage
assets. S&P also views this development positively as it will
generate substantial near-term liquidity inflow, and demonstrates
HCG's ability to liquefy its mortgage assets.
S&P also views positively HCG's June 14 announcements that it has
reached agreements to settle all outstanding claims with both the
OSC and plaintiffs in the class action lawsuit, subject to approval
by the OSC and the court. S&P understands substantially all
settlement costs, of about C$42 million, will be covered by HCG's
existing liability insurance.
Finally, S&P notes that HCG's deposit balances have shown tentative
signs of stabilization since the June 14 announcement. For example,
the company reported that the group's high-interest savings account
demand deposits amounted to about C$324 million on May 1; this
total declined steadily, although at a decelerating pace, to C$98.5
million on June 16, but has since stabilized at about C$112
million. Similarly, the group's guaranteed investment certificate
term deposits (of which only some are in a cashable position each
day) declined to C$12.013 billion on June 19 from C$12.749 billion
on May 1, but have slightly rebounded, to C$12.026 billion, as of
June 21.
The outlook is positive, implying at least a one-in-three chance
that S&P could raise the long-term ratings within one year.
Specifically, S&P could raise its long-term ratings if S&P viewed
HCG's near-term uncertainty as substantially mitigated, for example
with regard to the stability of funding arrangements and its
liquidity position, as a result of a closed deal with BRK.
S&P could also raise the long-term ratings if it sees sufficient
deposit stabilization to become convinced that HCG's liquidity
position (relative to expected cash outflows) has improved. Other
factors that might contribute to an upgrade could include that S&P
come to believe that the BRK investment will cause our
risk-adjusted capital ratio to sustainably rise above 15%, or that
HCG announces appointments to key senior management positions (CEO
and CFO, in particular), on a credible and permanent basis.
S&P could place the ratings on CreditWatch with developing
implications, or lower the ratings, were the BRK deal to be
cancelled, if significant deposit outflows were again to resume, or
were HCG to suffer further departures of key personnel from senior
management or its board of directors.
HOMEJOY LLC: Unsecureds to Recoup 4.4% Under Plan
-------------------------------------------------
Homejoy LLC filed with the U.S. Bankruptcy Court for the Northern
District of California a disclosure statement dated June 14, 2017,
describing the Debtor's plan of reorganization dated June 14,
2017.
A total of $1,707,182.17 of timely filed Class 3 General Unsecured
Claims have been asserted. As part of the overall global
settlement, a total of $75,000 will be distributed on a pro rata
basis to each of the holders of Class 3 allowed claims, which the
Debtor estimates will result in an estimated distribution of
approximately 4.4% if all timely filed Class 3 claims are allowed
in the amounts asserted. If any of these Class 3 filed claims are
ultimately disallowed, the estimated distribution to holders of
Class 3 allowed claims will increase. The Debtor is of the belief
that absent the global settlement and the confirmed Plan, general
unsecured creditors would not receive any distribution in this
case. Class 3 claims are impaired under the Plan and are therefore
entitled to vote on the Plan.
The distribution to holders of Class 3 allowed claims is expected
to be made within the later of (i) 30 days following the Effective
Date; and (ii) 30 days after the final disputed Class 3 claim is
resolved by final court order (or as soon as reasonably practicable
thereafter). The Committee reserves the right to seek an order of
the Court, after notice and a hearing, to disallow or to reduce any
asserted Class 3 claim which the Official Committee of Unsecured
Creditors disputes. Any objections to Class 3 claims must be filed
with the Court prior to the Effective Date.
The Plan will be funded from the estate funds and from any
recoveries obtained by the Debtor's estate from the pursuit of any
causes of action.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/canb15-53931-207.pdf
As reported by the Troubled Company Reporter on May 31, 2017, the
Debtor, in its previously proposed plan to exit Chapter 11
protection, would set aside $75,000 to pay general unsecured
creditors. According to that plan, and as part of the Debtor's
settlement with creditors, a total of $75,000 would be distributed
on a pro rata basis to general unsecured creditors. This would
result in an estimated distribution of 3.23% if all timely filed
Class 3 claims are allowed in the amounts asserted.
About Homejoy LLC
Homejoy (assignment for the benefit of creditors) LLC is the
assignee and special-purpose entity formed by Sherwood Management,
LLC for the benefit of creditors of Homejoy, Inc. The assignment
went effective on Aug. 5, 2015.
Prior to the assignment, Homejoy, Inc., was primarily in the
business of providing an on-line database and directory for
consumers to find and hire home cleaning and janitorial services.
Homejoy LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Calif. Case No. 15-53931) on Dec. 15, 2015. The
petition was signed by Tim J. Cox, responsible individual.
The Debtor estimated both assets and liabilities in the range of $1
million to $10 million.
Judge Elaine E. Hammond presides over the case. Ron Bender, Esq.,
and John-Patrick M. Fritz, Esq., at Levene, Neale, Bender Yoo &
Brill LLP, represent the Debtor as bankruptcy counsel. The Debtor
hired Fineman West & Company, LLP as its accountant.
The Office of the U.S. Trustee appointed a committee to represent
unsecured creditors.
HT INTERMEDIATE: S&P Revises Outlook to Stable & Affirms 'B' CCR
----------------------------------------------------------------
S&P Global Ratings said it revised its outlook on California-based
apparel retailer HT Intermediate Holdings Corp. to stable from
positive. At the same time, S&P affirmed all ratings, including
the 'B' corporate credit rating.
S&P also affirmed the 'B' issue-level rating on the secured notes.
The '3' recovery rating is unchanged and indicates S&P's
expectations for moderate (50%-70%; rounded estimate: 55%) recovery
in the event of a payment default.
The outlook revision reflects S&P's expectation for weaker
operating performance in fiscal 2017 resulting from excess
inventory and merchandise missteps leading to sharp traffic
declines and increased markdowns in the first quarter. S&P expects
operating performance to continue to be challenged in the second
quarter, and then begin to stabilize in the second half of the
year. In addition, while the company did successfully repay its
$110 million 12%/12.75% holdco pay-in-kind (PIK) toggle notes, it
was funded by a new issue of $110 million 13% PIK preferred stock,
which S&P treats as debt in our calculations. Therefore, the
company did not deleverage from the transaction as S&P had
initially anticipated, resulting in weaker-than-expected credit
metrics. S&P believes that the combination of these two events
limits the upside of the rating over the next 12 months.
The stable outlook on HT Intermediate Holdings Corp. reflects S&P's
expectation that operating trends will stabilize in the second half
of fiscal 2017 as the company improves its inventory position and
corrects its recent merchandise misstep. As of the quarter ended
April 29, 2017, debt to EBITDA was 5.2x and FFO to debt was 12.4%.
S&P expects debt to EBITDA at year-end 2017 to remain in the
low-5.0x area, and FFO to debt to decline to the mid-10% range.
S&P could take a negative rating action if the company further
underperforms S&P's expectations, driven by weak consumer spending
and continued merchandising issues that result in additional margin
pressure. This would cause gross margin to contract around 150 bps
beyond S&P's current base-case forecast, and sales to grow in the
low-single-digit range (compared with S&P's base-case forecast of
low- to mid-single-digit revenue increase). Under this scenario,
total adjusted debt to EBITDA would be in the 6.0x area. S&P could
also lower the rating as a result of additional debt-financed
dividend payments that cause credit protection measures to
materially weaken and leverage to exceed this threshold.
S&P could take a positive rating action in the next year if it
expects the company to maintain debt to EBITDA at or below 4.0x and
FFO to debt to be in the high-teens range on a sustained basis.
This would be supported by S&P's view that the likelihood of a
significant re-leveraging event has greatly diminished. Given the
sponsor ownership, S&P would expect a longer track record
demonstrating less aggressive policy before raising the rating and
would also expect sustained positive operating trends to support an
upgrade.
IMMUCOR INC: Commences Notes Exchange Offer
-------------------------------------------
Immucor, Inc., announced the commencement of an offer to eligible
holders to exchange any and all of Immucor's outstanding 11.125%
Senior Notes due 2019 for a new series of 11.125% Senior Notes due
2022. The Company also announced that upon launch of the Exchange
Offer, holders of approximately 71% of the outstanding principal
amount of the Old Notes had agreed, pursuant to a support agreement
entered into with the Company, to tender their Old Notes prior to
the Expiration Date. Citigroup Global Markets Inc. has agreed,
subject to certain terms and conditions, including the consummation
of the Exchange Offer as set forth in the Offering Documents to
purchase an amount of New Notes equal to the amount of Old Notes
not exchanged in the Exchange Offer, up to $116,000,000 in
aggregate principal amount, the proceeds of which will be used to
redeem any unexchanged Old Notes in full.
The Exchange Offer is being conducted upon the terms and subject to
the conditions set forth in the offering memorandum and related
letter of transmittal, each dated June 19, 2017. The Exchange
Offer is only being made, and copies of the Exchange Offer
documents will only be made available, to holders of the Old Notes
that have certified to Immucor in an eligibility letter as to
certain matters, including their status as either (1) a "qualified
institutional buyer" under Rule 144A under the Securities Act, or
(2) a person who is not a "U.S. person" as defined under Regulation
S under the Securities Act.
The Offering Documents will only be distributed to holders of Old
Notes who complete and return a letter of eligibility confirming
that they are Eligible Holders. Requests for copies of this
eligibility letter, the offering circular or other Offering
Documents may be directed to the information agent, Global
Bondholder Services Corporation, at (866) 470-3800 (toll free),
(212) 430-3774 (for banks and brokers) or by email at
contact@gbsc-usa.com.
The Exchange Offer will expire at 11:59 p.m., New York City time,
on July 17, 2017, unless extended by the Company.
The New Notes have not been and will not be registered under the
Securities Act or any state securities laws, and, unless so
registered, may not be offered or sold in the United States or to
any U.S. persons except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act and any applicable state securities laws.
About Immucor
Founded in 1982, Immucor, Inc., a Georgia corporation, is a
worldwide leader in the transfusion and transplantation in vitro
diagnostics markets. The Company's products perform typing and
screening of blood and organs to ensure donor-recipient
compatibility. The Company's offerings are targeted at hospitals,
donor centers and reference laboratories around the world.
Immucor reported a net loss of $43.8 million on $380 million of net
sales for the year ended May 31, 2016, compared to a net loss of
$60.7 million on $389 million of net sales for the year ended May
31, 2015. As of Feb. 28, 2017, Immucor had $1.66 billion in total
assets, $1.35 billion in total liabilities and $310.42 million in
total equity.
* * *
As reported by the TCR on June 22, 2017, S&P Global Ratings said it
affirmed its 'CCC+' corporate credit rating on Immucor Inc. and
revised the outlook to developing from negative. "The rating
affirmation reflects our view that, although the company addressed
the upcoming maturities and we expect a gradual improvement
resulting from the recently announced cost-cutting initiative,
Immucor's credit measures will remain relatively weak in 2018 with
leverage around 9x and funds from operations (FFO) to debt in the
low single digits," said S&P Global Ratings credit rating analyst
Maryna Kandrukhin. It also reflects Immucor's lack of a proven
track record of sustained operating improvement.
The TCR reported on March 31, 2016, that Moody's Investors Service
downgraded the ratings of Immucor, including the Corporate
Family Rating (CFR) to 'Caa1' from 'B3'.
IMMUCOR INC: Seeks to Extend Term Loan Maturity to 2021
-------------------------------------------------------
Immucor, Inc., made available to potential lenders certain
information regarding the business and operations of the Company in
connection with a proposed debt refinancing transaction. The
Company is party to a credit agreement and related security and
other agreements with a bank syndicate of lenders, and Citibank
N.A., as the administrative agent, which provide for a senior
secured term loan facility and senior secured revolving loan
facilities.
In addition, the Company commenced an offer to exchange any and all
of the Company's outstanding 11.125% Senior Notes due 2019 for
11.125% Senior Notes due 2022.
The proposed Refinancing and Exchange Offer are subject to market
and other conditions, and there can be no assurance as to the terms
of the proposed Refinancing or Exchange Offer, or that the proposed
Refinancing or Exchange Offer will occur.
Proposed Refinancing
As part of a proposed refinancing, Immucor Inc. is seeking to
extend the maturity of its senior secured term loan facility from
Aug. 19, 2018, to June 15, 2021, and to increase the principal
amount from $635 million to $647 million.
Transfusion and Transplant Markets
Based on the Company's estimates, it is a top 2 global player in
transfusion and transplantation diagnostics. The market
opportunity split between the Human Leukocyte Antigen transplant
market and the transfusion market is 25% and 75%, respectively. The
Company's market share in the transfusion and transplant markets
are 28% and 10%, respectively.
Blood Demand in the United States
The Company's transfusion revenues are relatively stable despite
end-market demand pressure.
From December 2008 through March 2015, the CAGR for US blood demand
was (5.1%). After April 2015, the CAGR was (0.3%).
Expanding Opportunities with Next Generation Sequencing
MIA FORA enables the Company to sell to high-resolution typing
customers. This gives the Company leverage to sell legacy
LIFECODES products and its entire portfolio to such customers.
Based on the Company's estimates, before MIA FORA was introduced,
the Company had access to a $200 million segment. The introduction
of MIA FORA gives the Company access to the entire $400 million
segment.
Cost Savings Positively Impact EBITDA
The Stamford, Connecticut manufacturing site was closed on May 31,
2017, and manufacturing activities for transplant products were
transferred to Waukesha, Wisconsin. This resulted in total savings
of $3.7 million, with $0.5 million recognized in FY2017 and $3.2
million to be recognized in FY2018. The cash-on-cash payback of
approximately one year with related cash spend was completed in
FY2017.
Together with the Company's cost reduction initiative, the Company
anticipates cost savings will positively impact EBITDA by over $18
million on an annualized basis starting in Q4 fiscal year 2017.
FY2017 Takeaways
FY2017 is in line with its guidance with low single-digit growth in
revenue and adjusted EBITDA, excluding Sentilus.
As of May 28, 2017, the Company's revolver balance was $0.
Beyond FY2018
Beyond FY2018, the Company expects that acceleration of the top
line will by driven by, in the transfusion segment, the
stabilization of U.S. blood demand, the penetration of the EU
patient market and continued success in the emerging markets, and
in the transplant and molecular segment, by the penetration of the
transplant market, led by MIA FORA, and the continued adoption of
successful mIH methods.
The Company expects that profitability will be led by revenue
growth, although cost synergy opportunities remain. The cash flow
profile of the business remains in line with historical
performance.
The regulatory filing is available for free at:
https://is.gd/755esD
About Immucor
Founded in 1982, Immucor, Inc., a Georgia corporation, is a
worldwide leader in the transfusion and transplantation in vitro
diagnostics markets. The Company's products perform typing and
screening of blood and organs to ensure donor-recipient
compatibility. The Company's offerings are targeted at hospitals,
donor centers and reference laboratories around the world.
Immucor reported a net loss of $43.8 million on $380 million of net
sales for the year ended May 31, 2016, compared to a net loss of
$60.7 million on $389 million of net sales for the year ended May
31, 2015. As of Feb. 28, 2017, Immucor had $1.66 billion in total
assets, $1.35 billion in total liabilities and $310.42 million in
total equity.
* * *
As reported by the TCR on June 22, 2017, S&P Global Ratings said it
affirmed its 'CCC+' corporate credit rating on Immucor Inc. and
revised the outlook to developing from negative. "The rating
affirmation reflects our view that, although the company addressed
the upcoming maturities and we expect a gradual improvement
resulting from the recently announced cost-cutting initiative,
Immucor's credit measures will remain relatively weak in 2018 with
leverage around 9x and funds from operations (FFO) to debt in the
low single digits," said S&P Global Ratings credit rating analyst
Maryna Kandrukhin. It also reflects Immucor's lack of a proven
track record of sustained operating improvement.
The TCR reported on March 31, 2016, that Moody's Investors Service
downgraded the ratings of Immucor, including the Corporate
Family Rating (CFR) to 'Caa1' from 'B3'.
INFRASTRUCTURE SOLUTION: Case Summary & 15 Top Unsecured Creditors
------------------------------------------------------------------
Debtor: Infrastructure Solution Services, Inc.
25 West Skippack Pike, Suite 101
Ambler, PA 19002
Tel: (484) 704-7200
Business Description: The Debtor is a contractor for
infrastructure and utility services.
Chapter 11 Petition Date: June 23, 2017
Case No.: 17-14344
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Judge: Hon. Ashely M. Chan
Debtor's Counsel: Richard J. Landry, Esq.
HENNESSY, BULLEN, MCELHENNY & LANDRY
55 N. Lansdowne Ave.
P.O. Box 217
Lansdowne, PA 19050
Tel: 610-745-0346
E-mail: rlandry30@comcast.net
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Peter A. Burns, president.
The Debtor's list of 15 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/paeb17-14344.pdf
JACK ROSS: Disclosures OK'd; Plan Confirmation Hearing on July 26
-----------------------------------------------------------------
The Hon. Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada has approved Jack Ross Industries, LLC's first
amended disclosure statement dated May 29, 2017, referring to the
Debtor's plan of reorganization.
A confirmation hearing will be conducted on July 26, 2017, at 2:00
p.m.
All objections to the Debtor's proposed Plan must be filed by July
12, 2017.
The Debtor will file any responsive pleading to objections to its
Plan on or before July 19, 2017.
All ballots for the acceptance or rejection of Debtor's Plan must
be delivered to the Debtor's counsel on or before July 21, 2017.
The Debtor will file a ballot summary pursuant to Local Rule 3018
on or before July 25, 2017.
The last day for creditors to file complaints against the Debtor
for non-dischargeability of a debt will be July 26, 2017.
As reported by the Troubled Company Reporter on June 6, 2017, the
Debtor filed with the Court a first amended disclosure statement
dated May 29, 2017, referring to the Debtor's plan of
reorganization, which proposes that the holder of Class 1 Secured
Claim, International Cartridge Corporation, retain its existing
security interest in the Debtor's property as identified in its
Security Agreement and UCC-1 Financing Statement. The obligation
will bear interest at the rate of 5% per annum. However, in the
event of objection by the Class 1 claimant, the obligation will
bear interest at a rate agreed upon by the parties or determined by
the Court at the Confirmation Hearing. The obligation will be paid
at the rate of $400 per month, commencing on the Effective Date
until paid in full (approximately 56 months). To the extent not
inconsistent with this paragraph, the terms and conditions of the
existing documents and security agreement will remain in full force
and effect.
About Jack Ross Industries
Jack Ross Industries, LLC, based in Reno, Nevada, operates an
indoor gun shooting range. The Debtor also sells ammunition and
other supplies related to gun maintenance.
The Debtor filed a Chapter 11 petition (Bankr. D. Nev. Case No.
16-51053) on Aug. 24, 2016. The petition was signed by Christopher
Parker, managing member. The Debtor is represented by Alan R.
Smith, Esq., at the Law Offices of Alan R. Smith. The case is
assigned to Judge Bruce T. Beesley. The Debtor disclosed $168,100
in assets and $1.06 million in liabilities.
No official committee of unsecured creditors has been appointed in
the case.
JANKOSA INC: Wants Plan Exclusivity Extended through August 25
--------------------------------------------------------------
Jankosa Inc. requests the U.S. Bankruptcy Court for the District of
Nevada to extend the period in which only the Debtor may
exclusively file a Chapter 11 Plan by a period of 60 days until
August 25, 2017.
The Debtor's current exclusivity period to file a plan ends June
26, 2017, absent an extension.
The Debtor contends that an extension will give it the time
necessary to complete the refinancing of debt owed to secured
creditor, Wells Fargo Bank, N.A. In the alternative, the Debtor
tells the Court that if the refinancing fails to close then the
Debtor will have adequate time in which to prepare and file a
Chapter 11 Plan.
The Debtor contends that it is presently negotiating with Nevada
Mortgage, Inc. to refinance Wells Fargo's debt. The Debtor says
that when the financing closes, it will no longer require the
protection of the Court and the instant case will likely be
voluntarily dismissed with the purposes of the Code being
maintained.
A hearing is set for July 26, 2017 at 1:30 p.m. to consider the
Debtor's Motion.
About Jankosa Inc.
Jankosa Inc. owns and manages a single parcel of real estate
property. Jankosa Inc. filed a Chapter 11 petition (Bankr. D. Nev.
Case No. 17-11492), on March 28, 2017. Jankosa Inc. is represented
by:
Roger P. Croteau, Esq.
Tmothy E. Rhoda, Esq.
Roger P. Croteau & Associates, Ltd.
9120 West Post Road, Suite 100
Las Vegas, NV 89148
Telephone: (702) 254-7775
Facsimile (702) 228-7719
Email: croteaulaw@croteaulaw.com
JO-ANN STORES: S&P Affirms 'B' CCR & Revises Outlook to Stable
--------------------------------------------------------------
S&P Global Ratings said it affirmed its 'B' corporate credit rating
on Hudson, Ohio–based fabrics and crafts specialty retailer
Jo-Ann Stores Holdings Inc. S&P revised the outlook to stable from
negative.
In addition, S&P lowered its issue-level rating on the upsized $821
million first-lien term loan to 'B' from 'B+'. S&P revised the
recovery rating to '3' from '2', indicating its expectation for
meaningful (50% to 70% range; rounded estimate: 60%) recovery of
principal in the event of a payment default. S&P also affirmed its
'CCC+' issue-level rating on unsecured notes. The recovery rating
remains '6', indicating S&P's expectations for negligible recovery
(0% to 10%; rounded estimate: 0%) in the event of default.
S&P does not rate the $400 million asset-backed lending (ABL)
revolving credit facility.
The outlook revision reflects S&P's expectation for continued
modest stabilization of market share position driven by improved
merchandising and store refreshes. S&P believes large product
assortment, expanded online channel capabilities, and increased
product curation will support continued customer loyalty and
provide modest advantage over discounters and independent
operators. Management has demonstrated a track record of gross and
EBITDA margin expansion, as well as reduction in leverage in the
period of declining comparable sales over the past two years,
achieving 5.3x leverage in the first quarter of 2017 (down from
mid-6x in 2015). S&P expects at least a leverage-neutral growth
over the next 12 months and with current 5.3x leverage, S&P thinks
there is a rating cushion in the event of modest top line softness
beyond S&P's current forecast.
The stable outlook on Jo-Ann reflects S&P's expectation that the
company's focus on refreshing stores and maintaining relevancy of
the Jo-Ann brand through investments in direct sourcing
capabilities will continue driving modest gross and EBITDA margin
expansion and allow Jo-Ann to maintain or increase its market share
in the fabric and crafts industry. S&P believes the company will
be able to extend its track record of operational execution and
gradually improve its credit measures to maintain leverage in the
low-5x area in the next 12 months.
S&P could revise the outlook back to negative if credit measures do
not improve or cash burn accelerates over the next 12 months. This
could occur if Jo-Ann cannot manage growth on a leverage-neutral
basis, whether from competitive pressures or traffic and ticket
declines. This would cause revenue growth to slow down to
–negative 3%, gross and EBITDA margins to decline more than 150
basis points, and debt to EBITDA to increase to 6x or above. S&P
would also consider revising the outlook or lowering the rating in
the event of a sponsor-led, debt-financed transaction.
S&P could revise the outlook to positive if the company executes on
its store growth plans while maintaining cost control and gradually
decreasing adjusted leverage to 5x or below. S&P could raise the
rating if it expects debt to EBITDA to remain below 5x on a
sustained basis, EBITDA margins to expand by more than 200 basis
points, and Jo-Ann gains market share and demonstrates continued
track record of successful new store openings. Additional reduction
in ownership by the private equity sponsor would support an upgrade
because S&P believes this would reduce the risk of the company
pursuing debt-financed shareholder returns.
KINGS INDUSTRIES: July 19 Plan Confirmation Hearing
---------------------------------------------------
The Hon. Shon Hastings of the U.S. Bankruptcy Court for the
District of Nebraska has conditionally approved Kings Industries,
LLC's disclosures statement dated June 7, 2017, referring to the
Debtor's amended plan of reorganization dated June 7, 2017.
The hearing on the final approval of the Disclosure Statement and
plan confirmation will be held on July 19, 2017, at 1:00 p.m.
Objections to the Disclosure Statement must be filed by July 14,
2017.
The last day to submit written acceptance or rejection of the Plan
is July 14, 2017. Ballots must be filed with the Court by July 17,
2017.
About Kings Industries LLC
Kings Industries, LLC, filed a Chapter 11 petition (Bankr. D. Neb.
Case No. 16-81049), on July 11, 2016. The petition was signed by
Sunnay Emmanuel, President. At the time of filing, the Debtor
estimated assets of less than $1 million and liabilities of less
than $50,000.
The case is assigned to Judge Shon Hastings. The Debtor is
represented by Howard T. Duncan, Esq., Howard T. Duncan, PC, LLO,
Omaha, Nebraska.
On April 4, 2017, the Debtor filed a Chapter 11 plan of
reorganization.
KITTERY POINT: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Kittery Point Partners, LLC
10 Lawrence Lane
P.O. Box 278
Kittery Point, ME 03905
Business Description: KPP is a limited liability corporation
first formed and registered under the
laws of Delaware on April 21, 2005.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-20316
Court: United States Bankruptcy Court
Maine (Portland)
Judge: Hon. Michael A. Fagone
Debtor's Counsel: George J. Marcus, Esq.
MARCUS CLEGG
One Canal Plaza, Suite 600
Portland, ME 04101-4102
Tel: (207) 828-8000
Email: bankruptcy@marcusclegg.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Tudor Austin, manager.
The Debtor did not file a list of its 20 largest unsecured together
with the petition.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/meb17-20316.pdf
LAW-DEN NURSING: CAN Capital Objects to Plan & Disclosures
----------------------------------------------------------
CAN Capital Asset Servicing Inc. filed with the U.S. Bankruptcy
Court for the Eastern District of Michigan a supplemental objection
to Law-Den Nursing Home, Inc.'s combined plan and disclosure
statement.
CAN Capital claims that the Combined Plan and Disclosure Statement
does not provide adequate information to CAN Capital to allow it to
be able to make an informed decision with respect to its treatment
under the proposed plan. Specifically, it does provide any
information that discloses why CAN Capital should not retain its
lien on the personal property of the Debtor and why it should not
be paid interest on its claim. To the extent CAN Capital retains
liens on property, it should be allowed in the plan confirmation
order to file deeds of trust and UCC financing statements where
appropriate.
Docket entry 159 is a stipulation between Law-Den Nursing Home,
Inc., and CAN Capital concerning the date by which CAN Capital was
to file objections to the proposed plan of reorganization. The new
deadline was stipulated to be June 7, 2017. On June 7, 2017, CAN
Capital filed its objection. The next day on June 8, 2017, the
Debtor filed an Amended Exhibit "F" to Chapter 11 Plan Payments.
This Amendment changes the treatment proposed by the Debtor in its
plan. This Amendment was filed after the date by which the Debtor
and CAN Capital stipulated to as the deadline for CAN Capital's
objection.
CAN Capital makes this Supplemental Objection because the changes
made to its treatment in the Amended Exhibit "F" to Chapter 11 plan
payments. The Amended Schedule "F" makes material changes to the
treatment of CAN Capital's claim under the proposed plan. The plan
provides that CAN Capital is to be paid sixty monthly payments
until CAN Capital's plan is paid in full. CAN Capital's claim is
fully secured in the amount of $192,804.11. This claim amount
divided by 60 equals a monthly payment of $3,213.40.
The Amended Exhibit "F" reduces the $3,213.40 monthly payment to
$2,296.28. CAN Capital says that not only does the Debtor intend
to reduce monthly payments to CAN Capital, Amended Exhibit "F"
shows, inexplicably, credits to be applied to CAN Capital, in other
words, the plan seems to require CAN Capital to makes payments to
the Debtor.
The Debtor, according to CAN Capital, has not filed any disclosure
that explains the changes made to the plan treatment by Amended
Exhibit "F". To be clear, no additional disclosure has been filed
in conjunction with Amended Exhibit "F".
The proposed plan removes CAN Capital's first lien against
insurance receivables (non-Medicare/Medicaid) and personal property
and replaces its secured position with a fourth lien on real
property of the Debtor.
CAN Capital complains that the plan is not fair and equitable as to
CAN Capital because, with respect to a class of secured claims, the
plan provides: (i)(I) that the holders of the claims retain the
liens securing the claims, whether the property subject to the
liens is retained by the Debtor or transferred to another entity,
to the extent of the allowed amount of the claims; and (II) that
each holder of a claim of the class receive on account of the claim
deferred cash payments totaling at least the allowed amount of the
claim, of a value, as of the effective date of the plan, of at
least the value of the holder's interest in the estate's interest
in the property; (ii) for the sale, subject to Section 363(k) of
this title [11 USCS Section 363(k)], of any property that is
subject to the liens securing the claims, free and clear of the
liens, with the liens to attach to the proceeds of the sale, and
the treatment of the liens on proceeds under clause (i) or (iii) of
this subparagraph; or (iii) for the realization by the holders of
the indubitable equivalent of the claims.
A copy of the Supplemental Objection is available at:
http://bankrupt.com/misc/mieb16-52058-176.pdf
CAN Capital is represented by:
The Gerger Law Firm, PLLC
Alan S. Gerger, Esq.
2211 Norfolk Street, Suite 517
Houston, Texas 77098
Tel: (713) 300-1430
Fax: (888) 317-0281
E-mail: asgerger@gerglaw.com
bkpfilings@gerglaw.com
About Law-Den Nursing Home
Law-Den Nursing Home, Inc., filed a Chapter 11 petition (Bankr.
E.D. Mich. Case No. 16-52058) on Aug. 30, 2016. The petition was
signed by Todd Johnson, administrator. The Debtor is represented
by Clinton J. Hubbell, Esq., at Hubbell Duvall PLLC, in Southfield,
Michigan. The case is assigned to Judge Phillip J. Shefferly. At
the time of its filing, the Debtor estimated assets at $0 to
$50,000 and liabilities at $1 million to $10 million.
The Debtor taps David E. Jerome and the Law Offices of Jerome &
McLean as labor relations counsel, and Michigan Business Advisor as
accountants.
Daniel M. McDermott, United States Trustee for Region 9, submitted
a Notice of Appointment of Patient Care Ombudsman before the U.S.
Bankruptcy Court for the Eastern District of Michigan naming
Deborah L. Fish as the Patient Care Ombudsman in the bankruptcy
case of Law-Den Nursing Home, Inc.
LENEXA HOTEL: Exclusive Plan Filing Period Extended Through Aug. 31
-------------------------------------------------------------------
Judge Dale L. Somers of the U.S. Bankruptcy Court for the District
of Kansas extended the exclusive periods during which only Lenexa
Hotel LP may file a Plan and Disclosure Statement, and solicit plan
acceptances, to and including August 31 and October 31, 2017,
respectively.
The Troubled Company Reporter has previously reported that the
Debtor asked the Court for a 90-day extension of its exclusivity
periods, contending that one of its significant assets was a
litigation claim involving Holiday Hospitality Franchising LLC.
The Debtor contended that it has just received a favorable ruling
from the Kansas Federal District Court, which denied the motion to
dismiss filed by Holiday Hospitality Franchising. The Debtor said
that the case will now move to a trial setting.
Accordingly, the Debtor told the Court it was working on various
financial options and additional options that should be available
as a result of the favorable ruling on its Claim. The Debtor
believed that it has reasonable prospects for filing a viable plan
of reorganization and believes additional time will aid and assist
in developing and negotiating a comprehensive and beneficial plan.
About Lenexa Hotel
Lenexa Hotel owns and operates a hotel at 12601 West 95th Street,
Lenexa, Kansas 66215. It is a Kansas limited partnership that was
originally formed in 1982. After formation, Lenexa acquired the
Hotel, which had been operating at the site since construction in
1971. The hotel has operated under various brands throughout its
history, and currently operates under a franchise agreement with
Holiday Hospitality Franchising, Inc. under the Crowne Plaza
brand.
Lenexa Hotel filed a Chapter 11 bankruptcy petition (Bankr. D.
Kans. Case No. 16-22172) on November 1, 2016. In its petition, the
Debtor estimated $1 million to $10 million in assets and $10
million to $50 million in liabilities. The petition was signed by
Stephen J. Craig, president.
Lentz Clark Deines PA represents the Debtor as counsel. Brennan
Fagan and Fagan Emert & Davis, LLC and the Skepnek Law Firm have
been tapped as special counsel. Michele C. Hammann, SS&C Solutions,
Inc and Summers, Spencer & Company, P.A., serve as accountants.
LIGHTING SCIENCE: Wins Appellate Reversal in Geveran Lawsuit
------------------------------------------------------------
The Florida Fifth District Court of Appeals reversed on June 9,
2017, the trial court's grant of summary judgment against Lighting
Science Group Corporation and the other defendants in the case,
including J.P. Morgan Securities, LLC in the lawsuit brought by
Geveran Investments Limited, a Cyprus-based investment entity
associated with Norwegian billionaire John Fredriksen.
Geveran, one of the Company's stockholders, filed suit on June 22,
2012, under Florida securities laws seeking rescission of its $25.0
million investment in the Company and recovery of attorneys' fees
and court costs for alleged violations of the Florida securities
laws. Geveran alternatively sought unspecified money damages, as
well as recovery of court costs, for alleged common law negligent
misrepresentation.
On Aug. 28, 2014, the Circuit Court for Orange County granted
Geveran's motion for partial summary judgment with respect to its
first cause of action for violation of the Florida Securities and
Investor Protection Act. On Nov. 30, 2015, the Circuit Court
entered judgment against the defendants, including the Company, on
a joint and several basis, in the amount of approximately $40.2
million. On Dec. 4, 2015, the Company, along with the other
defendants, filed a Notice to Appeal to the Appeals Court and each
of the Company and JP Morgan posted a bond in the amount of $20.1
million to secure the circuit court's judgment.
The Appeals Court's decision validates the Company's long-held
belief that the Circuit Court erred in granting summary judgment
against the Company and the other defendants. In reversing the
summary judgment decision, the Appeals Court held that Geveran must
prove that it relied on alleged misrepresentations by Company
representatives in connection with Geveran's investment. The
Appeals Court further held that there are genuine issues of
material fact as to both the materiality of the alleged
misrepresentations as well as Geveran's lack of reliance.
The Company and JP Morgan can move to discharge the bond once the
Appeals Court issues its mandate implementing its decision, which
is expected to occur within 30 days after the Appeals Court issued
its opinion, subject to Geveran's right to seek post-opinion relief
(for panel rehearing and/or rehearing en banc by the entire court,
for clarification, or to certify a question to the Florida Supreme
Court).
The case will now be remanded to the Circuit Court for further
proceedings, subject to Geveran's right to seek post-opinion
relief. The Company believes Geveran's suit is without merit and
intends to continue to vigorously defend the matter.
About Lighting Science
Lighting Science Group Corporation is a provider of light emitting
diode (LED) lighting technology. The Company designs, develops,
manufactures and markets illumination solutions that use LEDs as
exclusive light source. The Company's product portfolio includes
offerings, such as replacement lamps, luminaires and biological
lighting. LED-based retrofit lamps (replacement bulbs) are used in
existing light fixtures, as well as LED-based luminaires (light
fixtures).
Lighting Science reported a net loss of $20.21 million for the year
ended Dec. 31, 2016, compared to a net loss of $27.08 million for
the year ended Dec. 31, 2015.
"In connection with the preparation of the financial statements for
the year ended December 31, 2016, management concluded that due to
certain factors... such as our historical cash flows and operating
results, our existing and future debt obligations, the redemption
rights of certain preferred stockholders and our obligations to
make capital contributions to GVL upon closing of the pending Joint
Venture transaction, substantial doubt exists regarding our ability
to continue as a going concern. Nonetheless, management believes
that certain events that have occurred since December 31, 2016 and
certain actions expected to be implemented in 2017 will alleviate
such substantial doubt. Specifically, management has concluded that
it is probable that the following events will alleviate the
substantial doubt raised by the Liquidity Challenges and, as a
result, that we will be able to satisfy our estimated liquidity
needs for 12 months from the issuance of the financial statements
included in this Form 10-K:
* We issued Series J Securities in January and February 2017
for $10.0 million in aggregate gross proceeds;
* Proceeds from the recent issuances of Series J Securities
were used to repay a portion of the outstanding borrowings
under the Ares ABL, bringing the outstanding balance to $2.2
million as of March 31, 2017;
* Headcount reductions in February 2017 are expected to result
in significant cost savings;
* We anticipate that gross margins and cash flows will improve
following the closing of the Joint Venture;
* Following a series of transactions among certain holders of
Preferred Stock, Pegasus solely possesses the optional
redemption rights described above under the heading "Equity
financing and related matters" and Pegasus has indicted that,
subject to certain conditions, it will not exercise such
rights through November 14, 2019; and
* ... Pegasus has committed to provide financial support to us
to fund our operations and debt service requirements of up to
$13.2 million as they come due at least until April 12,
2018," the Company stated in its annual report for the
year ended Dec. 31, 2016."
M2 NGAGE: Merges With Media Branding and Marketing Company Troika
-----------------------------------------------------------------
Troika Acquisition Corp, a California corporation and wholly owned
subsidiary of M2 nGage Group, Inc., was merged into Troika Design
Group, Inc., a California corporation, founded in 2001,
(www.troika.tv) with Troika as the surviving company and a wholly
owned subsidiary of the Company.
On June 12, 2017, M2 nGage entered into a Merger Agreement with
Troika, a media branding and marketing innovations agency, each of
the Troika subsidiaries, Troika Acquisition Corp, a California
corporation and wholly owned subsidiary of the Company and Daniel
Pappalardo, the sole shareholder of Troika with the future
intention of rebranding the Company to Troika Media Group
(troikamedia.com), Inc., to take advantage of Troika's brand name
recognition and world class clients, including AT&T, ESPN, ABC,
NBC, CBS, MSG, UFC and Sony.
Subject to the terms and conditions of the Merger Agreement, all of
the shares of common stock of Troika were exchanged for the
following:
* 30,700,000 restricted shares of the Company's common stock.
* Company paid $2,800,000 to Troika to pay certain outstanding
debt obligations of Troika and deposited $2,200,000 in a
separate bank account, which will be used for working capital
of both the Company and Troika as determined by the Company
and Troika, and failing that by the Company's Board of
Directors.
* The Stock Consideration is subject to the terms of a Lock-Up
Agreement with Mr. Pappalardo and Subscription Agreements
with Mr. Pappalardo's Designees that will provide for certain
portions of the Stock Consideration to vest in thirty-six
equal tranches over a three year period, commencing on the
Closing Date.
* 3,070,000 shares of the Stock Consideration will be held in
escrow for a period of one year, which will secure the
indemnification obligations of Troika and Mr. Pappalardo.
* Certain employees of Troika will be entitled to performance
bonuses of up to $5,000,000 in accordance with their
respective Employment Agreements.
* Mr. Pappalardo entered into a five year employment agreement
with the Company to serve as the president of Troika
following the Effective Date.
* Mr. Pappalardo will have the right to be elected as one of
the Company's Board of Directors; provided that, as of June
19, 2017, Mr. Pappalardo has not been elected to the Board of
Directors and has not exercised any rights in connection
therewith.
* At closing Mr. Pappalardo was granted options to purchase
7,500,000 shares of Common Stock of the Company at the then
fair market value. The options will vest as follows (i) one-
half on July 1, 2018; and (ii) the remaining one-half on July
1, 2019.
* Following the Effective Date, the Company agreed that to
authorize an additional 30,000,000 shares of Common Stock
under its current Equity Incentive Plan and that former
employees of Troika will be eligible to receive options. The
Company also agreed that any such options would be registered
under a Registration Statement on Form S-8 within two years
of the Closing Date.
Mr. Pappalardo entered into a five year employment agreement with
the Company dated as of June 12, 2017 to serve as Troika's
president. The Employment Agreement provides for an annual base
salary of $347,288 for the term, subject to two-year extensions
unless earlier terminated.
About M2 Ngage
M2 nGage Group, Inc., formerly Roomlinx, Inc., was incorporated
under the laws of the state of Nevada. The Company, through its
subsidiaries, provides wired and wireless broadband services to
customers located throughout the United States, turnkey services
including all technology, infrastructure and expertise necessary to
construct both temporary and permanent broadband wireless networks
at large event forums, such as stadiums and concert venues and
sells, installs, and services in-room media and entertainment
solutions for hotels, resorts, and time share properties; including
its proprietary Interactive TV platform, internet, and free to
guest and video on demand programming. The Company also sells,
installs and services telephone, internet, and television services
for residential consumers. The Company develops software and
integrates hardware to facilitate the distribution of Hollywood,
adult, and specialty content, business applications, national and
local advertising, and concierge services. The Company also sells,
installs and services hardware for wired networking solutions and
wireless fidelity networking solutions, also known as Wi-Fi, for
high-speed internet access to hotels, resorts, and time share
locations. The Company installs and creates services that address
the productivity and communications needs of hotel, resort and time
share guests, as well as residential consumers. The Company may
utilize third party contractors to install such hardware and
software.
M2 nGage reported a net loss of $81.47 million for 2015 following a
net loss of $11.99 million for 2014.
As of Dec. 31, 2015, the Company had $13.07 million in total
assets, $42.08 million in total liabilities, and a total deficit of
$29 million.
RBSM LLP, in New York, issued a "going concern" qualification on
the consolidated financial statements for the year ended Dec. 31,
2015, citing that the Company has incurred recurring net losses,
used cash in operating activities, and had negative working
capital, which raise substantial doubt about its ability to
continue as a going concern.
MAISON HUGO: Seeks to Hire IPG as Real Estate Broker
----------------------------------------------------
Maison Hugo LLC seeks approval from the U.S. Bankruptcy Court for
the Southern District of New York to hire a real estate broker.
The Debtor proposes to hire International Properties Group in
connection with the sale of its lease. The Debtor's current base
rent is $27,810 per month under the lease, which is scheduled to
terminate in October 2025.
IPG will get a commission of 5% of the total sale price or 2.5% if
there is a co-broker.
George Donohue, president of IPG, 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:
George Donohue
International Properties Group
520 Eight Avenue, 8th Floor, New Tower
New York, NY
About Maison Hugo LLC
Maison Hugo LLC, which operates a modern French brasserie, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y.
Case No. 17-11554) on June 5, 2017. Florian Hugo, managing member,
signed the petition. At the time of the filing, the Debtor
estimated assets and liabilities of less than $50,000.
Pick & Zabicki LLP is the Debtor's bankruptcy counsel.
MALIBU LIGHTING: MLC Unsecureds to Recover 6.1%-7.1% Under Plan
----------------------------------------------------------------
Malibu Lighting Corporation and the Official Committee of Unsecured
Creditors filed with the U.S. Bankruptcy Court for the District of
Delaware a disclosure statement and a joint Chapter 11 plan of
liquidation dated June 14, 2017.
Class 5 General Unsecured Claims are impaired by the Plan and are
treated as follows:
* Class 5(A) ODC Debtors, estimated at $10 million, will recover
34.1% to 503%;
* Class 5(B) MLC, estimated at $4.8 million, will recover 6.1%
to 7.1%; and
* Class 5(C) NCOC Debtors, estimated at $2.6 million, will
recover 100%.
The Plan is a plan of liquidation which, inter alia, provides for
the treatment of all Claims against and equity security interests
in the Debtors. The Plan provides for partial substantive
consolidation of certain of the Debtors. Each of the Debtors are
being substantively consolidated with their respective parent
corporation as they (i) have de minimis, if any, assets, (ii) have
de minimis, if any Claims scheduled or filed against them, and
(iii) were not operating on the Petition Date.
The Plan contemplates the compromise, settlement, and release of
the Debtors' and the Estates' Claims against the Brinkmann Parties
and d the Debtors' insurer, Continental Casualty Insurance Company.
The proceeds from the global settlement will be deposited into an
account maintained by the Liquidation Trust for the benefit of
holders of allowed claims. The Liquidation Trust will make
distributions to all holders of allowed claims pursuant to the
terms of the Plan. The JBBI Secured Claims will not receive any
distributions under the Plan. The Equity Interests and Subsidiary
Equity Interests will be cancelled on the Effective Date of the
Plan. The Intercompany Claims are not classified, but they provide
the basis for the allocation of the Settlement Consideration
between and among the ODC Debtors, MLC and the NCOC Debtors,
pursuant to the Distribution Model Methodology. The Brinkman
Intercompany Claims will be treated in accordance with the Global
Settlement Agreement.
The Plan also provides for the compromise of controversy of all
claims and causes of action by the Debtors and the Estates pursuant
to Rule 9019 of the Bankruptcy Rules against CCC, the Brinkmann
Parties in exchange for the Settlement Consideration.
The Disclosure Statement is available at:
http://bankrupt.com/misc/deb15-12080-1267.pdf
The date by which ballots must be received is at 4:00 p.m. on July
19, 2017 (Prevailing Pacific Time).
Objections to the confirmation of the Plan must be filed by 4:00
p.m. on July 19, 2017 (Prevailing Eastern Time).
The hearing on confirmation of the Plan is on July 26, 2017, at
2:00 p.m. (prevailing Eastern time).
As reported by the Troubled Company Reporter on June 5, 2017,
Malibu Lighting and the Committee previously filed a disclosure
statement and a joint Chapter 11 plan of liquidation, dated May 19,
2017, which contemplated the compromise, settlement, and release of
the Debtors' and the Estates' claims against the Brinkmann Parties
and Continental Casualty Insurance Company.
About Malibu Lighting Corporation
Malibu Lighting Corp., Outdoor Direct Corp., National Consumer
Outdoors Corp., Beam Corp., Smoke 'N Pit Corp., Treasure Sensor
Corporation and Stubbs Collections Inc. filed Chapter 11 bankruptcy
petitions (Bankr. D. Del. Lead Case No. 15-12080) on Oct. 8, 2015.
The petition was signed by David M. Baker as chief restructuring
officer. Judge Kevin Gross is assigned to the case.
MLC was a manufacturer and supplier of outdoor and landscape
lighting products, such as solar and low voltage lights and home
security lights, including the parts and accessories associated
with these products.
ODC was a manufacturer and supplier of a variety of consumer goods,
including (a) outdoor cooking products, such as outdoor gas grills,
charcoal grills, smokers and fryers, (b) hand held lighting
products, like flashlights and spotlights, (c) landscape lighting
products, and (d) parts and accessories associated with the
foregoing products.
MLC and ODC are winding down operations as a result of the
termination of a business relationship with principal customer,
Home Depot.
NCOC is a manufacturer and supplier of both branded and private
label pet bedding and pet accessory products. NCOC manufactures
beds, accessories, and deodorizers for dogs as well as beds,
scratching posts, and toys for cats. In addition, NCOC markets
and sells boat covers manufactured primarily from Chinese
suppliers. Malibu estimated assets and liabilities of
$10 million to $50 million in its bankruptcy petition.
The Debtors have engaged Michael Seidl, Esq., Jeffrey N. Pomerantz,
Esq., and Maxim B. Litvak, Esq., at Pachulski Stang Ziehl & Jones
LLP as counsel, Piper Jaffray Co. as investment banker, and
Kurtzman Carson Consultants as claims and noticing agent.
On Oct. 20, 2015, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee hired
Lowenstein Sandler LLP as its counsel, Blank Rome LLP as its
Delaware co-counsel and BDO USA, LLP, as its financial advisor.
In March 2017, the Committee tapped Strasburger & Price LLP as
local counsel.
MARION SD 200: Moody's Cuts GOULT Debt Rating to Ba1
----------------------------------------------------
Moody's Investors Service has downgraded the rating on Marion,
Clinton, Washington & Jefferson Counties High School District 200
(Centralia), IL's general obligation unlimited tax (GOULT) debt to
Ba1 from Baa1. Concurrently, Moody's has assigned a negative
outlook. The district has $7.5 million in rated GOULT debt. The
downgrade to Ba1 reflects district's narrow liquidity position
following several years of operating deficits. Liquidity is being
further pressured by significant delays in categorical grant
payments, for which the district has above average dependence. Also
incorporated in the Ba1 is the district's limited tax base with
below average socioeconomic profile and average debt burden.
Rating Outlook
The negative outlook is driven by the district's trend of operating
deficits and a narrowing reserve position. While the district had
budgeted for improved financial operations in fiscal 2017, its
ability to stabilize reserves has been stymied by delays in state
categorical grant payments. Given its narrow reserve position, the
district has limited cushion to respond to the delays and begun to
cash flow borrow to bridge the payment gaps.
Factors that Could Lead to an Upgrade
Substantial improvement in the district's cash position
Improved financial operations
Factors that Could Lead to a Downgrade
Increase in delays in categorical grants, or decline or delays in
general state aid
Further deterioration of liquidity requiring Increased reliance on
short-term borrowing for cash flow
Significant increase in the district's debt burden, or pension
increased pension liabilities related to a pension cost-shift
Legal Security
Debt service on the district's outstanding GOULT bonds are secured
by its unlimited tax pledge by which the full faith, credit and
resources of the district are pledged, payable from ad valorem
taxes unlimited as to rate or amount.
Use of Proceeds. Not applicable
Obligor Profile
The district is located in southern Illinois approximately 60 miles
east of the city of St. Louis (A3 negative) and lies within Marion,
Clinton, Jefferson, and Washington counties. According to the 2015
American Community Survey, the district serves a population of
21,351 in the cities of Centralia, Wamac, Walnut Hill, and Central
City as well as some unincorporated surrounding areas. Enrollment
for the district was approximately 900 students in fiscal 2017.
Methodology
The principal methodology used in this rating was US Local
Government General Obligation Debt published in December 2016.
MAVERICK INT'L: Sale of Antique Canes, Beatles Items Until Today
----------------------------------------------------------------
An online auction of various antique canes, Beatles autographed
memorabilia, Rolling Stones autographed memorabilia and artwork
will end today.
The online auction, being conducted by Iron Horse Auction Company,
Inc., began June 19 and will close at 6 p.m., today, June 26.
Iron Horse Auction is based at 174 Airport Rd., in Rockingham,
North Carolina.
The properties to be sold include:
-- these antique canes
Victorian Silver Top Sword Cane
Horn Gun Crook Cane
Monogrammed Gold-Handled Walking Stick
Ladies Silver & Ivory Walking Stick Cane
Silver and MOP Stacked Horn Cane
English Horse Hoof Cane
Umbrella Crook-Neck Cane
Staghorn Twisted Shaft Cane
Lizard Skin Walking Stick Cane
Crook Neck Malacca Flask Cane
Silver and Stag Handle Cane
Brass Sword Cane
American Southwest Cholla Cactus Cane
Mexican Folk Art Cane
1Sterling Silver Knob Top Can Walking Stick
Agate Ball Cane
Silver and Ivory Elephant Cane
Cheroot Cannon Cane
Briggs Spring Loaded Pencil Cane
Carved ivory Automated Alligator Cane
Ivory Two Face Dress Cane
Silver horse Hoof Knobkerrie Cane
Tiffany Nast Eagle Cane
English Spyglass Cane
Agate and Silver Dress Cane
Agate and Ivory Ladies Cane
Ivory Phrenology Cane
English Ivory Pique Pomander Cane
Tiffany Silver Gargoyle Cane
Nautical Whale Bone Cane
Ivory Carved Bird Cane
French Ivory Pique Cane Walking Stick
Silver Cat Head Figural Dress Cane
Austro-Hungarian Sporting Cane
German Grotesque Portrait Cane
Tortoiseshell Crook Neck Cane
Carved Horn Horse Head Cane
Victorian Carved Ivory Dandy Cane
Military Compass Cane
French Porcelain Chinoiserie Cane
Folk Art Dagger Cane
German Carved Ivory Cane
Makhila Weapon Cane
Porcelain Saint Cloud Dress Cane
Gold Duck Head Cane
Remington Percussion Ball and Claw Rifle Cane
Saint Cloud Porcelain Cane
Silver Parrot Dress Cane
Porcelain Dress Cane
Meissen Porcelain Incroyable Cane
Meissen Porcelain Pug Dog Cane
Meissen Porcelain Dress Cane
Silver Mermaid Cane
Ivory Portrait Cane of a Gentleman
Nymphenburg German Porcelain Dress Cane
Remington Large Dog Head Gun Cane
Ivory Flute Playing Rabbit Cane
Meissen Cane of an Aristocratic Lady
Toledo Spain Sword Cane
Silver Art Deco Dog Cane
Damasceme Crook Dress Cane
Stag Horn Satirical Cane
Damascene Crook Dress Cane
Ivory Standing Elephant Cane
Porcelain Dress Cane
Art Nouveau Silver Cane
Stag Horn Portrait Cane
English Turnbridge Cane
Damascene Claw and Egg Cane
Damascene Ball Dress Cane
Double California Golf Quartz Dress Cane
Amethyst and Silver Dress Cane
Porcelain Coat of Arms Cane
Three Faces Crystal Cane
Damascene Dress Cane
Bacchanalian Figural Cane
Art Nouveau Silver Fair Maiden Cane
Toledo Damascene Steel and Gold Dress Cane
Nymphenburg Porcelain Dress Cane
Whalebone Scrimshaw Nautical Cane
Toledo Damascene Steel and Gold Dress Cane
Silver Elephant Dress Cane
Toledo Damascene Dress Cane
Porcelain Chinoserie Dress Cane
Hippo Ivory Dress Cane
Silver and Amethyst Dress Cane
Damascene Tau Handle Dress Cane
Damascene Dagger Cane
Sterling Silver Day Cane
Silver Fox and Pheasant Cane
Gold Presentation Cane
Damascene Dress Cane
Swiss Horn Cane
-- Framed Paul McCartney and Ringo Starr Signed "White
Album" Cover #0102403, with Records and Backstage Passes
to Beattles Concert Displayed, Certification of
Authenticity
-- Framed John Lennon signed "Mind Games" Album w/ Record
Displayed, Certification of Authenticity
-- Signed Rolling Stones Drum Head, Singed by Mick Jagger,
Ronnie Wood, Charlie Watts and Keith Richards. NAS
Certification
-- Framed, "Introducing...The Beattles" Album (Vee-Jay
Records StereoPhonic SR 1062) w/ Record and Stationary
Paper Bearing All Four Beattles Band Members Signatures.
-- Erte Serigraph, "La Sompteuse". 94/300. Framed and matted
under glass. 33 x 40 inches.
-- Grace Carol Bomer, "The Rapture". Christmas, 2006. 13
feet and 3 inches high. 10 feet and 3 inches wide.
Composed of six separate components. Painted on wood
panels. The artwork contains scripture and musical
scores.
-- Bill Mack, "Fascination" Wall Sculpture. Bonded sand
finish. 40 3/4 inches x 70 1/2 inches.
-- Barbara Wood, Serigraph, "The Foyer". Framed and matted
under glass, 50 inches x 52 inches. 335/350.
-- Barbara Wood, Serigraph, "Solitaire". Framed and matted
under glass, 40 inches x 45 inches. 274/350.
-- Itzchak Tarkey, "Unknown Title", Serigraph. Framed and
matted under glass, 24 x 28 inches. 337/350.
-- Louis Icart, "Fascination", Bronze. 20 inches tall.
7/100.
All items in this auction are selling "AS-IS, WHERE IS" with all
faults, if any. Iron Horse makes no representations or warranties,
expressed or implied, concerning the items being sold. Descriptions
of the items are believed to be correct, but are not guaranteed. It
is the Buyer's responsibility to conduct any inspections prior to
the auction. All due diligence periods end the date the auction is
scheduled to end and prior to the end of the auction.
It is possible that the property being sold is subject to local,
state and federal regulatory authorities and it is the Buyer's
responsibility to ascertain if they are subject to regulation and
permitting. Iron Horse Auction Company, Inc. has attempted to find
or locate all information deemed material facts. Ultimately, it is
the Buyer's responsibility to inspect all aspects of the items
before placing a bid. No sale shall be invalidated by the Buyer as
a result of he/she not conducting their own inspection prior to
placing a bid or doing due diligence.
It is automatically acknowledged by placing a bid that you have
personally inspected the property, hired an agent to inspect the
property, or waived your right to inspect the property.
The firm may be reached at 910-997-2248
Additional information may be reached at https://is.gd/tNW8qK
The assets being sold come from these bankruptcy estates:
-- Maverick Int'l, Inc., U.S. Bankruptcy Court Western
Division of North Carolina Charlotte Division Case
14-50805
-- Daniel J. Fontana, U.S. Bankruptcy Court Western Division
of North Carolina Charlotte Division Case 14-30773
-- Val Rhae Claypoole, U.S. Bankruptcy Court Western
Division of North Carolina Statesville Division Case
15-50186
Maverick Int'l, Inc., based in Mooresville, North Carolina, filed a
Chapter 11 petition (Bankr. W.D. N.C. Case No. 14-50805) on
November 5, 2014, listing under $500,000 in assets and under $10
million in debts. The Hon. Laura T. Beyer was assigned to the
case. The petition was signed by Phillip Winfield, president.
Maverick engaged as counsel:
James H. Henderson, Esq.
JAMES H. HENDERSON, P.C.
1201 Harding Place
Charlotte, NC 28204-2248
Tel: 704.333.3444
Fax: 704.333.5003
Email: henderson@title11.com
Daniel J. Fontana is a Chapter 7 debtor (Bankr. W.D. N.C. Case No.
14-30773). The case began as a Chapter 11 and was converted to a
Chapter 7 liquidation on February 27, 2015. John W. Taylor was
appointed as the Chapter 7 trustee. Mr. Fontana was represented by
David R DiMatteo, Esq., Travis W. Moon, Esq., and Richard S.
Wright, Esq., at Moon Wright & Houston, PLLC.
Val Rhae Claypoole is a debtor under W.D.N.C. Case No. 15-50186.
MCCLATHCY CO: Will Sell Majority of 15% Ownership in CareerBuilder
------------------------------------------------------------------
McClatchy has entered into an agreement along with other owners
TEGNA Inc., the controlling shareholder owning 53% of
CareerBuilder, LLC, and Tribune Media Company to sell CareerBuilder
to an investor group led by investment funds managed by affiliates
of Apollo Global Management along with the Ontario Teachers'
Pension Plan Board. The transaction is expected to close in the
third quarter of 2017 subject to regulatory approval and customary
closing conditions.
Prior to the sale, CareerBuilder has committed to making a normal
distribution to the current shareholders, of which McClatchy
expects to receive approximately $8 million.
As part of the agreement, current owners TEGNA Inc., Tribune Media
Company and McClatchy will retain a minority ownership stake in
CareerBuilder. McClatchy's ownership will be approximately 3.8% on
a fully-diluted basis.
McClatchy's after-tax proceeds related to the sale of CareerBuilder
are expected to be approximately $68 million bringing total cash
received (including the normal distribution above) to approximately
$76 million. In accordance with its 2012 bond indenture, the
company is required to offer its after-tax proceeds from the sale
to the holders of its secured bonds due in 2022 at par if not
reinvested into the business within one year of receiving the
proceeds. The company will record a non-cash impairment of $45
million to $55 million in the second quarter of 2017 in connection
with the prospective sale.
The Company's affiliate agreement with CareerBuilder will be
terminated upon the earlier of July 31st or the closing of the
transaction. Upon termination, the Company's media businesses will
continue to provide comparable digital employment solutions from
CareerBuilder and/or other employment providers while continuing to
list employment related ads on its websites and in its printed
newspapers.
Craig Forman, McClatchy's president and chief executive officer
said, "Our CareerBuilder interest has been a valuable asset over
the years, and we wish the company well in navigating the future.
For McClatchy, the result of the TEGNA-led CareerBuilder
transaction will provide after-tax proceeds to further reduce debt
and/or potentially use for reinvestment in the company."
About McClatchy
The McClatchy Company -- http://www.mcclatchy.com/-- is publisher
of iconic brands such as the Miami Herald, The Kansas City Star,
The Sacramento Bee, The Charlotte Observer, The (Raleigh) News &
Observer, and the (Fort Worth) Star-Telegram. McClatchy operates
30 media companies in 29 U.S. markets in 14 states, providing each
of its communities with high-quality news and advertising services
in a wide array of digital and print formats. McClatchy is
headquartered in Sacramento, Calif., and listed on the New York
Stock Exchange under the symbol MNI.
McClatchy reported a net loss of $34.19 million for the year ended
Dec. 25, 2016, compared to a net loss of $300.16 million for the
year ended Dec. 27, 2015. As of March 26, 2017, McClatchy had
$1.74 billion in total assets, $1.72 billion in total liabilities
and $21.72 million in total stockholders' equity.
* * *
Moody's Investors Service affirmed the Caa1 corporate family rating
rating of The McClatchy Company and changed the rating outlook to
stable from positive due to continued weakness in the print
advertising market and the ongoing pressure on the company's
operating cashflow, according to a TCR report dated Dec. 3, 2015.
As reported by the TCR on April 2, 2014, Standard & Poor's Ratings
Services affirmed all ratings on U.S. newspaper company The
McClatchy Co., including the 'B-' corporate credit rating, and
revised the rating outlook to stable from positive. The outlook
revision to stable reflects S&P's expectation that the timeframe
for a potential upgrade lies beyond the next 12 months, and could
also depend on the company realizing value from its digital
minority interests.
MHE ASSOCIATES: Vacant Commercial Building Up for July 27 Auction
-----------------------------------------------------------------
The Sheriff of DeKalb County will sell to the highest bidder for
cash, the real property of MHE Associates Limited Partnership on
July 27, 2017, at 1:00 p.m. at the DeKalb County Public Safety
Bldg., 150 N. Main, Sycamore, IL 60178.
The property is a described mortgaged real estate at Lot 1 in Peace
Corporate Center, a planned unit development at 2600 Wirsing
Parkway, DeKalb, IL.
The mortgaged real estate is a vacant commercial building.
The sale is being made pursuant to a Judgment Order of Foreclosure
and Sale entered on May 11, 2017, in the case, JPMCC 2006-LDP9
WIRSING PARKWAY, LLC, Plaintiff, v. MHE ASSOCIATES LIMITED
PARTNERSHIP, an Ohio limited partnership, KAE AMES, LLC, an Ohio
limited liability company, UNKNOWN OWNERS and NON-RECORD CLAIMANTS,
Defendants. 17CH 49, pending before the Circuit Court of the
Twenty-Third Judicial Circuit, Dekalb County, Illinois.
Bidders must present, at the time of sale, a cashier's or certified
check for 10% of the successful bid amount. The balance of the
successful bid shall be paid within 24 hours, by similar funds.
The property will NOT be open for inspection.
JPMCC 2006-LDP9 WIRSING PARKWAY, LLC ("Plaintiff"), acting by and
through LNR Partners, LLC, solely in its capacity as special
servicer, and pursuant to 735 ILCS 5/15-1507(c), will conduct a
sale of the collateral pursuant to the Illinois Mortgage
Foreclosure Law.
Plaintiff's Attorney:
Amy E. McCracken, Esq.
Duane Morris, LLP
190 South LaSalle Street
Chicago, IL 60603
Telephone: (312) 499-6700
MISSISSIPPI POWER: Moody's Puts Ba1 CFR on Review for Downgrade
---------------------------------------------------------------
Moody's Investors Service placed Mississippi Power Company's
ratings, including its Ba1 Corporate Family Rating (CFR), Ba1
senior unsecured; Ba2-PD Probability of Default, and Ba3 preferred
stock rating on review for downgrade. Moody's also lowered
Mississippi Power's speculative grade liquidity rating to SGL-4
from SGL-3.
The ratings and stable outlook of the parent company, The Southern
Company (Southern, Baa2 senior unsecured), are unchanged.
On Review for Downgrade:
Issuer: Mississippi Power Company
-- Probability of Default Rating, Placed on Review for Downgrade,
currently Ba2-PD
-- Corporate Family Rating, Placed on Review for Downgrade,
currently Ba1
-- Pref. Stock Preferred Stock, Placed on Review for Downgrade,
currently Ba3
-- Senior Unsecured Regular Bond/Debentures, Placed on Review for
Downgrade, currently Ba1
Issuer: Eutaw (City of) AL, Industrial Dev. Board
-- Senior Unsecured Revenue Bonds, Placed on Review for
Downgrade, currently Ba1
Issuer: Harrison (County of) MS
-- Senior Unsecured Revenue Bonds, Placed on Review for
Downgrade, currently Ba1
Issuer: Mississippi Business Finance Corporation
-- Senior Unsecured Revenue Bonds, Placed on Review for
Downgrade, currently Ba1
Downgrades:
Issuer: Mississippi Power Company
-- Speculative Grade Liquidity Rating, Downgraded to SGL-4 from
SGL-3
Outlook Actions:
Issuer: Mississippi Power Company
-- Outlook, Changed To Rating Under Review From Negative
RATINGS RATIONALE
"The review of Mississippi Power's ratings is prompted by
heightened cost recovery challenges associated with the uneconomic
and financially burdensome Kemper Integrated Gasification Combined
Cycle (IGCC) plant" said Michael G. Haggarty, Associate Managing
Director. "The Mississippi Public Service Commission's (MPSC) view,
articulated yesterday, that the plant should operate solely as a
natural gas facility could preclude recovery of up to $3.4 billion
of unrecovered plant costs, resulting in another substantial
write-off", added Haggarty.
The MPSC, following a meeting yesterday, indicated that it wanted
to amend the Kemper certificate to mandate that the plant burn only
natural gas, not synthetic gas made from lignite, which could mean
that costs associated with the gasifier portion of the plant may
not be included in rates. The MPSC encouraged a settlement on
Kemper related matters among Mississippi Power, the Mississippi
Public Utilities Staff and intervening parties over a 45 day period
following the next MPSC meeting on July 6, 2017. The MPSC directed
that the settlement include no rate increase and a potential rate
reduction for Mississippi Power customers, especially residential
customers.
The review of Mississippi Power's ratings will incorporate whether
a settlement is reached by the utility and the MPU Staff and the
provisions of any such settlement; the magnitude of any write offs
that will need to be taken by Mississippi Power and parent Southern
Company; the parent's ongoing support for Mississippi Power,
including the size and timing of any equity contributions to the
utility; the utility's plans to address its constrained liquidity
position; any rate orders or other regulatory decisions on the part
of the MPSC; Mississippi Power's projected financial ratios and
capital structure going forward; liquidity position and the overall
regulatory framework for Mississippi in light of the Kemper plant
problems.
The downgrade of Mississippi Power's speculative grade liquidity
rating to SGL-4 from SGL-3 reflects an inadequate liquidity profile
resulting from the near term maturity of the utility's bank term
loan and revolving credit facility, each of which expires over the
next 12 months. Mississippi Power has a $1.2 billion unsecured term
loan agreement with a group of banks that is now current, maturing
on April 1, 2018. Mississippi Power's cash on hand was only $6
million at March 31, 2017, down from $224 million at December 31,
2017, and the utility maintains $173 million of bank revolving
credit facilities that expire in 2017, of which $23 million was
drawn and $40 million provided liquidity support to variable rate
pollution control revenue bonds. The utility is also highly reliant
on the parent company, which currently provides $551 million of
promissory notes, for liquidity.
Mississippi Power's Ba1 CFR is predicated on the continued credit
and liquidity support of the Southern parent company. Mississippi
Power's December 31, 2016 SEC 10-K financial statement presentation
contemplates continuation of the utility as a going concern solely
as a result of Southern's anticipated and expressed ongoing
financial support for the company. In its first quarter earnings
call on February 22, 2017, Southern management indicated that it is
committed to the financial integrity of Mississippi Power, even
though it has no legal obligation to do so, an important
consideration supporting the current rating.
Southern's ratings and stable outlook are unchanged, reflecting
Mississippi Power's position as one of Southern's smaller utility
subsidiaries, with the Kemper project thus far having a material
but manageable impact on the parent's consolidated financial
condition. This is particularly the case since Southern's
acquisition of AGL Resources, Inc. (now Southern Company Gas) last
year, increased its overall scale, diversification, and resiliency.
Although Southern has taken over $2.8 billion of pre-tax charges
related to Kemper, the company's downgrade to Baa2 last year was
largely attributable to higher parent debt levels and lower
financial metrics due to the largely debt financed AGL
acquisition.
Southern's rating could be negatively affected if there are
additional, material debt financed acquisitions by the parent
company; if there are additional delays or cost increases at
Georgia Power's Vogtle new nuclear construction project; further
financial deterioration of Westinghouse Electric Company LLC
(unrated) guarantor Toshiba Corporation (Caa1, negative); if
Southern's consolidated credit metrics show a decline, including
cash flow from operations pre-working capital below 15% for an
extended period; or if there is rating pressure at one of its
larger subsidiaries, including Georgia Power Company (A3 negative),
Alabama Power Company (A1 stable), Southern Power Company (Baa1
stable), or Southern Company Gas Capital (Baa1 stable).
The principal methodology used in these ratings was Regulated
Electric and Gas Utilities published in December 2013.
The Southern Company is a utility holding company headquartered in
Atlanta, Georgia and the parent company of utility subsidiaries
Alabama Power Company, Georgia Power Company, Gulf Power Company,
Mississippi Power Company, Southern Company Gas, Southern Electric
Generating Company, wholesale power company Southern Power Company,
financing subsidiaries Southern Company Gas Capital and Southern
Company Capital Funding, Inc., and commercial paper issuer Southern
Company Funding Corporation.
MOOD MEDIA: Moody's Assigns B3 CFR, Outlook Stable
--------------------------------------------------
Moody's Investors Service assigned a B3 corporate family rating
(CFR), a B3-PD probability of default rating (PDR), and a stable
ratings outlook to Mood Media Borrower, LLC (MM Borrower). As part
of the same action, Moody's assigned a Caa1 rating to the company's
$175 million second lien notes. Co-issuers of the second lien
notes, MM Borrower and Mood Media Co-Issuer, Inc. (MM Co-Issuer),
are indirect, wholly-owned subsidiaries of Mood Media Corporation
(MM Corp; Caa1 negative).
Should the transaction close as currently contemplated, it will
constitute a distressed exchange (DE) in which MM Corp's $350
million senior unsecured notes are retired at a significant
discount to the face value. Moody's defines DEs as events of
default and consequently, at closing, the agency will append MM
Corp's Caa3-PD PDR with its /LD limited default indicator for one
business day (refer to Moody's 18 April 2017 press release).
Subsequently, since all of MM Corp's debts will be retired, MM Corp
will be privatized and re-domiciled in Delaware by GSO Capital
Partners LP and Apollo Global Management LLC, Moody's will withdraw
all of its ratings (refer to Moody's policies related to ratings
withdrawals).
The following summarizes rating actions:
Assignments:
Issuer: Mood Media Borrower, LLC
-- Corporate Family Rating: Assigned B3
-- Probability of Default Rating: Assigned B3-PD
-- Senior Secured Second Lien Notes: Assigned Caa1 (LGD5)
-- Outlook: Assigned Stable
RATINGS RATIONALE
Mood Media Borrower, LLC's (MM Borrower) B3 CFR stems from the
four-plus year runway prior to debt maturities to prove out the
uncertain return economics and growth prospects of the company's
in-store digital audio and visual media subscription branding and
advertising services, and reduce aggressive leverage of ~5.7x
debt/EBITDA (Moody's adjusted; 31Mar17, pro forma). Event risks
stemming from the company's private equity ownership include a debt
structure that suggests future re-levering even should de-levering
efforts be successful, as well as the potential of leverage
increasing via merger and acquisition activity aimed at augmenting
or substantiating the company's business model.
MM Corp is expected to have adequate liquidity arrangements based
primarily on free cash flow of $10 million to $15 million,
estimated cash of about $10 million, no debt maturities over the
next four quarters, and full availability under a new $15 million
revolving credit facility, along with adequate covenant compliance
cushions.
Rating Outlook
The stable ratings outlook is premised on a stable business
platform and leverage of 5.25x to 5.75x (5.7x at 31Mar17, pro
forma).
What Could Change the Rating -- Up
MM Borrower's CFR could be upgraded to B2 if Moody's expects:
* Positive industry fundamentals; and
* Maintenance of solid liquidity; and
* Margin expansion and growing EBITDA; and
* Leverage sustained below 5x (5.7x at 31Mar17, pro forma).
What Could Change the Rating - Down
MM Borrower's CFR could be downgraded to Caa1 if Moody's expects:
* Suppressed or deteriorating industry fundamentals; or
* Weak or deteriorating liquidity; or
* Declining margins or deteriorating EBITDA; or
* Leverage sustained above 6x (5.7x at 31Mar17, pro forma).
The principal methodology used in these ratings was Media Industry
published in June 2017.
Company Profile
Headquartered in Austin, Texas, Mood Media Borrower, LLC, provides
subscription branding and advertising services using primarily
in-store/premises digital audio and visual media for retail
companies in the United States (63% of revenue) and internationally
(37% of revenue).
NEW COVENANT PAINTING: Hires Bond Law Office as Attorney
--------------------------------------------------------
The New Covenant Painting of NWA, Inc., seeks authority from the
U.S. Bankruptcy Court for the Western District of Arkansas to
employ Bond Law Office, as attorney to the Debtor.
New Covenant requires Bond Law Office to represent the Debtor in
the Chapter 11 bankruptcy case.
The Debtor proposes that Bond Law Office will be paid at these
hourly rates:
Attorney $300
Associate $250
Paraprofessional $100
Prior commencement of the bankruptcy case, Bond Law Office received
from the Debtor a retainer of $5,000, and $1,717 filing fee.
Bond Law Office will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Stanley V. Bond, partner of Bond Law Office, 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 Debtor and its estates.
* * *
This is the Debtor's second attempt to seek Court approval to hire
Bond Law Office. At the onset of the bankruptcy case, the Debtor
sought the Court's permission to hire the firm. The U.S. Trustee,
however, objected to the engagement, and the Court denied the
Debtor's Application in an April 18 order.
On June 20, the U.S. Trustee again lodged an objection to the
Debtor's renewed request. The U.S. Trustee also has asked the
Court to either dismiss the case or convert it to Chapter 7
liquidation. A hearing on the Motion to Dismiss or Convert has
been continued to Aug. 16, 2017, at 9:00 a.m.
Bond Law Office can be reached at:
Stanley V. Bond, Esq.
BOND LAW OFFICE
PO Box 1893
Fayetteville, AR 72702-1893
Tel: (479) 444-0255
Fax: (479) 479-235-2827
About The New Covenant Painting of NWA, Inc.
The New Covenant Painting of NWA, Inc., filed a Chapter 11
bankruptcy petition (Bankr. W.D. Ark. Case No. 17-70191) on Jan.
27, 2017, disclosing under $1 million in both assets and
liabilities. The Debtor is represented by Emily J. Henson, Esq., at
Bond Law Office, as counsel.
NEXTERA ENERGY: Fitch Assigns First-Time BB+ Long-Term IDR
----------------------------------------------------------
Fitch Ratings has assigned Nextera Energy Partners, L.P. (NEP) a
first-time Long-term Issuer Default Rating (IDR) of 'BB+' with a
Stable Rating Outlook.
NEP's ratings are driven by the relatively stable and predictable
nature of contracted cash flow generation at its limited recourse
project subsidiaries, the asset and geographic diversity of its
wind, solar and natural gas pipeline portfolio, and strong sponsor
affiliation with Nextera Energy, Inc. (NEE, IDR 'A-'/Outlook
Stable), which is the largest renewable developer in the U.S. NEP's
ratings also take into account the structural subordination of
Holdco debt to the substantial limited recourse debt at the project
level, a capital structure that targets Holdco leverage ratio of
4.0x - 5.0x , and variability inherent in the wind resource. NEP is
subject to certain leverage and coverage ratios in its existing
credit agreements. The amortizing nature of debt at NEP's project
subsidiaries allows for accretion of residual value to Holdco in a
'run-off' scenario.
The ratings also reflect Fitch's view that the Yieldco model, while
still evolving, is sustainable despite its short and turbulent
history. The corporate governance changes announced will result in
NEE ceding control of NEP to the LP unit holders. Fitch has
observed a similar trend developing across the sector with Yieldcos
becoming more autonomous and independent of their sponsors.
NEP is a growth-oriented limited partnership formed by NEE to
invest in contracted clean energy projects with stable long-term
cash flows. Its current portfolio consists of 23 renewable
projects, which comprise 2.6 GW of wind and 442 MW of solar
generation capacity, and 4 billion cubic feet per day (Bcf/day) of
total pipeline capacity. Each of the wind and solar projects sell
their output and renewable energy attributes under long-term (20 -
30 years) power purchase agreements with creditworthy
counterparties, which primarily comprise utilities, electric
co-operatives and independent electricity system operators. The
natural gas pipeline portfolio consists of seven natural gas
pipelines in Texas with 3 Bcf/day of firm contracted capacity with
creditworthy counterparties, which primarily comprise large
exploration and production companies and midstream operators.
KEY RATING DRIVERS
Contractual Cash Flows and Asset Diversity
Fitch believes the asset and geographic diversity of NEP's
portfolio and the long-term contractual nature of revenues provide
adequate visibility into distributions the company receives from
its various project subsidiaries. Based on 2017 run-rate project
distributions, NEP's portfolio has 18-year remaining contract life
and an 'A-' weighted average counterparty credit rating (based on
Fitch's and other publically available ratings). The 2017 run-rate
project distributions to NEP are split into approximately 53% wind,
19% solar and 28% from natural gas pipelines. While the solar
portfolio is largely California based, the 18 wind projects are
geographically dispersed across 10 states in the U.S. and one
Canadian province. The pipeline portfolio has a weighted average
contract life of 13 years based on run-rate project distributions
to NEP. Fitch views the re-contracting risk associated with some of
the smaller pipelines as manageable. The volumetric risk comprises
less than 10% of the pipeline portfolio's total gross margin. Top 5
projects account for 47% of 2017 run-rate project distributions,
which include two pipeline projects, the 250 MW Genesis solar
project, and two wind projects financed with tax equity.
Strong Sponsor Support To Date
NEE currently controls 100% of NEP's GP and approximately 65% of
the LP interest. NEE established a Right of First Offer (ROFO)
portfolio at the time of NEP's IPO in 2014 under which Nextera
Energy Resources (NEER), the non-regulated generation subsidiary of
NEE, offers to NEP an identified set of solar and wind assets for
purchase at market prices. Aside from the acquisition of 990 MWs at
IPO, NEP has purchased approximately 2 GWs of additional wind and
solar assets from NEER to date. NEE is the largest renewable
developer in the U.S. and has 13 GW of renewable assets in service
(excluding those sold to NEP) as of Dec. 31, 2016. With the
corporate governance changes announced, NEP will continue to have
access to the ROFO portfolio. The ROFO agreement runs till July 1,
2020 and as of Dec 31, 2016, the ROFO pipeline stood at 1.2 GW. In
the fourth quarter of 2016, NEE implemented a structural
modification to the Incentive Distribution Rights (IDR) fee
structure that lowers NEP's cost of equity and makes future
acquisitions more accretive to LP unitholders.
NEE also provides to NEP its management, operational and
administrative services via various service agreements and
financial management services through a cash sweep and credit
support agreement. These agreements will continue to exist subject
to the determination by the new NEP Board. The management service
agreement (MSA) between NEE and NEP has a 20-year contract life and
cannot be terminated, except for cause. However, NEP's board will
have the ability to oversee the MSA.
Variability of Wind Resource a Key Risk
Fitch views resource variability as a key risk factor for NEP since
renewable generation is intermittent. However, solar resource
availability has typically been strong and predictable in Fitch's
experience and the geographical diversity of NEP's wind projects
mitigates wind resource variability to a large extent. Fitch has
used P50 to determine its rating case production assumption and P90
to determine its stress case production assumption. The Holdco
leverage metrics degrade by 30 basis points in the stress case as
compared to Fitch's rating case.
Project Debt Typically Sized for Investment Grade Rating
The limited recourse debt at the renewable projects is typically
sized to achieve a Debt Service Coverage Ratio (DSCR) > 1.2x and
generate a low to mid 'BBB' rating. Most recent DSCRs provided to
Fitch indicate that all the renewable projects financed with
project debt are performing well in excess of 1.2x. The natural gas
pipelines have DSCRs in 2.0x - 3.0x range. The debt typically
matures within the expiration date of the long-term contracts on
any project.
Robust Outlook for Wind and Solar Generation
Fitch believes the clarity on federal renewable tax subsidies,
State Renewable Policy Standards (RPS), customer demand for clean
energy, and improving economics will continue to drive wind and
solar growth in the U.S. NEE has a robust pipeline for new
renewable development and has outlined a target of 2.8 GW - 5.4 GW
of new wind and solar projects expected to come in service in 2017
- 2018. NEE is also repowering its older wind assets, where the
production tax credits have expired, and has outlined 1.6 GW of
repowering opportunity through 2018. NEE has also announced safe
harbor purchases that could qualify over 10 GW of wind for 100%
production tax credits. As a result, NEP should find no scarcity of
renewable assets to acquire from NEE or from third parties. Through
periodic acquisitions, Fitch believes NEP can meet its 12-15% LP
distribution growth guidance through 2022 and continue to have a
competitive cost of capital. Fitch's three-year financial forecasts
do not envisage diversification by NEP into other asset classes and
assumes future investments in its natural gas pipeline assets to be
modest.
Structural Tax Advantages
Even though NEP is a C corporation for U.S. federal income tax
purposes, it is not expected to pay meaningful federal income taxes
for at least 15 years because of Net Operating Losses (NOLs)
generated through the Modified Accelerated Cost Recovery System
(MACRS) depreciation benefits. NEP distributions up to an
investor's outside basis are expected to be characterized as
non-dividend distributions or return of capital for at least the
next eight years. This makes NEP competitive to Master Limited
Partnerships as a yield plus growth vehicle.
Target Holdco Leverage Ratio of 4.0x - 5.0x
NEP's 'BB+' IDR reflects subordination of Holdco debt to project
debt, which is typically sized to achieve a low to mid 'BBB'
rating. It also reflects management's target Holdco Debt/Parent
Only FFO ratio of 4.0x - 5.0x. The current Holdco debt is issued at
the indirect subsidiaries of NEP and consists of bank term loans of
$800 million (as of March 31, 2017) that mature in 2018 - 2019.
There is also a $250 million revolving credit facility that expires
in 2019 and approximately $10 million was drawn as of March 31,
2017. Fitch anticipates future debt issuance to be at the NEP
level. Fitch expects NEP to issue debt and equity to fund its
future asset acquisitions such that Holdco Debt/Parent Only FFO on
a run-rate basis is toward the lower end of 4.5x - 5.0x range by
2019. NEP has demonstrated access to capital markets on several
occasions since its IPO. Fitch defines Parent Only FFO as project
distributions less Holdco G&A expenses, fee for management service
agreement, credit fees and Holdco debt service costs. Fitch expects
Parent Only FFO to Interest Coverage ratio to be approximately 4.0x
in 2019 and the Payout Ratio (LP distributions and IDR fees divided
by Parent Only FFO) to be 83% in 2019, both on run-rate basis.
DERIVATION SUMMARY
Fitch is rating NEP based on a deconsolidated approach. The
company's portfolio comprises assets financed using non-recourse
project debt or with tax equity. The project debt has no cross
default covenants, either with other project debt or with Holdco
debt. NEP does not guarantee project debt obligations. NEP has the
ability to walk away from any non-performing project, whether it is
financed using project debt or tax equity.
Fitch's Renewable Energy Project Rating Criteria uses one-year P90
as the starting point in the determination of its rating case
production assumption. However, Fitch has used P50 to determine its
rating case production assumption for NEP since it owns a
diversified portfolio of operational wind and solar generation
assets. NEP's renewable portfolio consists of 23 projects that span
10 states in the U.S. and one Canadian province. In addition, NEP
derives approximately 28% of its 2017 run-rate project
distributions from its natural gas pipeline portfolio. Fitch
believes asset and geographic diversity reduces the impact that a
poor wind or solar resource could have on the distribution from a
single project. Fitch has used P90 to determine its stress case
production assumption. The Holdco leverage metrics degrade by 30
basis points in the stress case as compared to Fitch's rating case.
If volatility of natural resources and uncertainty in the
production forecast is high based on operational history and
observable factors, a more conservative probability of exceedance
scenario may be applied in the future.
NEP's ratings are derived on a standalone basis and are not linked
to the ratings of NEE. NEP units trade independently on the stock
exchange, and the corporate governance changes announced will
further cede control of NEP to the LP unitholders.
KEY ASSUMPTIONS
Fitch's key assumptions within its ratings case for the issuer
include:
-- P50 scenario used for rating case wind and solar production
assumption;
-- P90 scenario used for stress case wind and solar production
assumption;
-- Acquisition of renewable assets in 2017, 2018 and 2019 to meet
12-15% distribution growth. Asset acquisition metrics based on
8-11% 5-year cash available for distribution yield at the
project level;
-- Growth capex of $142 million at natural gas pipelines in 2017
and none thereafter;
-- Convertible preferred issuance of $550 million in 2017
(treated as 50% debt); and
-- Growth capex and acquisitions financed with debt and equity
such that target capital structure is maintained.
RATING SENSITIVITIES
Future Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- The structural subordination to the limited recourse project
debt, which is sized for a low to mid 'BBB' rating, and the
requirement to distribute a substantial portion of cash available
for distribution to its unitholders caps NEP's IDR at 'BB+'.
Future Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Growth strategy underpinned by aggressive acquisitions and/or
addition of assets in the portfolio that bear material volumetric,
commodity, counterparty or interest rate risks;
-- Material underperformance in the underlying assets that lends
variability or shortfall to expected project distributions;
-- Lack of access to equity markets to fund growth that may lead
NEP to deviate from its target capital structure;
-- Holdco leverage ratio exceeding 5.0x on a sustainable basis.
LIQUIDITY
NEP has a $250 million revolving credit facility that expires in
2019. As of March 31, 2017, approximately $110 million was drawn.
NEP also had 82 million as cash on hand as of March 31, 2017. NEP
generates strong FFO, however, it typically distributes a high
proportion of the FFO to LP holders after netting the IDR fees. The
growth capex associated with the natural gas pipeline portfolios
and future assets acquisitions are financed through external debt
and equity. As NEP grows, it is likely that it may seek to expand
its revolving credit facility to gain financial flexibility.
FULL LIST OF RATING ACTIONS
Fitch has assigned the following rating with a Stable Outlook:
Nextera Energy Partners, L.P.
-- Long-term IDR 'BB+'.
NEXTERA ENERGY: Moody's Assigns Ba1 Corporate Family Rating
-----------------------------------------------------------
Moody's Investors Service assigned a Ba1 Corporate Family Rating
(CFR), SGL-2 speculative grade liquidity rating to NextEra Energy
Partners LP. Moody's also assigned a Ba1 rating and LGD4 loss given
default rating to a $50 million term loan at NextEra Energy US
Partners Holdings LLC (Holdings). The term loan is guaranteed by
NextEra Energy Operating Partners, LP (NEOP). Holdings is an
indirect, 100% owned subsidiary of NEOP, whose limited partner
interests are owned 35% by NEP and 65% by NextEra Energy Inc
(NextEra, Baa1 stable). NEP owns a controlling, non-economic
general partner interest in NEOP
Assignments:
Issuer: NextEra Energy Partners, LP
-- Speculative Grade Liquidity Rating, Assigned SGL-2
-- Corporate Family Rating, Assigned Ba1
Issuer: Nextera Energy US Partners Holdings, LLC
-- Senior Secured Bank Credit Facility, Assigned Ba1(LGD4)
Outlook Actions:
Issuer: Nextera Energy US Partners Holdings, LLC
-- Outlook, Assigned Stable
Issuer: NextEra Energy Partners, LP
-- Outlook, Assigned Stable
RATINGS RATIONALE
"The Ba1 CFR is underpinned by stable cash flows arising from NEP's
diversified portfolio of renewable projects and gas pipelines with
a long contract life and Moody's expectations that leverage as
measured by consolidated Debt/EBITDA will not exceed 7.0x on a
sustained basis", said Swami Venkataraman, Senior Vice-President at
Moody's. "Moody's see the upcoming governance changes that increase
the independence of NEP as having both positive and negative credit
consequences, with features that strengthen its attractiveness to
investors but which also reduce the benefit that NEP receives from
being a part of the NextEra corporate family", he added.
NEP has a well diversified portfolio in several respects -- by
geography, by number of projects as well as by fuel. The company
has 2.6 GW of wind generation; 442 MW of solar generation; and 4
bcf/day of gas pipeline capacity spread over 23 projects and seven
pipelines. The projects are located in three broadly diversified
regions -- the west coast, the southern great plains and the upper
midwest and Canada. All projects benefit from fixed price,
long-term contracts, most with strong investment grade
counterparties, with an average remaining life of about 18 years.
NEP's proposed corporate governance changes creating greater
separation of NEP from NextEra have mixed credit implications which
are incorporated into the new rating. A change to the incentive
distribution rights (IDR) structure gives more cash flow to unit
holders and allows NEP to maintain dividend growth for longer with
the same amount of EBITDA. The planned changes to voting rights
also restrict NextEra's voting rights and effectively hand control
over to LP investors (who will also appoint a majority of the board
going forward). These changes are credit positive as they make NEP
stock more attractive to equity investors and improve access to
capital markets going forward.
However, the change in control (and deconsolidation of NEP from
NextEra for GAAP purposes) also creates greater distance between
NEE and NEP. LP investors have the ability, if they so chose, to
replace NEP's management going forward. In Moody's views there is
also a lower certainty that NEP will buy the assets currently in
NextEra's large renewable portfolio. The changes also allow NEP to
pursue its own financial policy that is not constrained by
NextEra's Baa1 credit rating.
Moody's rating incorporates the risk that yieldcos continue to be
an emerging and as yet unproven business model, although NEP has
been the best performing among all listed yieldcos to date. The
sector still faces challenging capital market conditions,
especially equity pricing, which makes issuing equity on an
accretive basis difficult. The changes to NEP's IDR structure and
other changes reflect an attempt to improve capital market access.
These concerns are partly balanced by the recognition that a lack
of growth is not necessarily credit negative for yieldcos, unless
management seeks to grow purely through the issuance of debt.
NEP's leveraged financial profile is a limiting factor to its
credit quality. NEP has a list of ROFO assets that currently totals
about 1,200 MW. NextEra has not at present indicated a desire to
add to this list. Should NEP acquire these projects in the next few
years, Moody's expects that it would do so while maintaining
leverage that is below 7.0x on a Debt/EBITDA basis and CFO pre-WC /
debt in the range of 9-11%.
NPV analysis of contract cash flows is an added component of
Moody's financial analysis for yieldcos, because Debt/EBITDA and
CFO pre-WC/Debt ratios look at one year's EBITDA or cash flow
relative to debt but do not fully capture the fact that yieldcos
have many years of contracted EBITDA. Specifically, for a given
level of annual Debt/EBITDA, the ratio cannot distinguish between a
company with ten years of contracted cash flows from another with
15 or 20 years of average contract life, with the latter clearly
exhibiting a superior credit quality. An NPV analysis allows us to
capture the full extent of contracted cash flow, in comparison with
other rated yieldcos. Moody's expects that the NPV of unlevered
free cash flows to total consolidated debt for NEP will remain in
the range of 175% to 200% over the next few years, higher than
other rated Yieldcos.
Outlook: The stable outlook reflects Moody's expectations for
consistent and predictable operations at NEP's diversified
portfolio of projects and that the company will maintain a
financial profile in line with Moody's expectations indicated
above.
Factors that Could Lead to an Upgrade: An upgrade of NEP's rating
is unlikely over the near term given the governance changes that
the company is undertaking, its plans for growth going forward, and
management's financial policy. However, a higher rating is possible
should NEP maintain is current strong contractual profile and
decrease leverage to less than 5x on a Debt/EBITDA basis and
generate CFO pre-WC / debt of at least 12% on a sustained basis.
Factors that Could Lead to a Downgrade: A deterioration in NEP's
contractual profile to incorporate shorter tenors, weaker
counterparties or merchant market exposure could result in a lower
ratings. Lower ratings may also result if leverage as calculated by
consolidated Debt/EBITDA increased to over 7x on a sustained
basis.
Liquidity NEP's liquidity is adequate as indicated by its SGL-2
rating. Moody's expects operating cash flow to cover all operating
needs, including dividend payments. NEP will need to access the
capital markets only to finance new project acquisitions. NEP has a
$250 million secured revolving credit facility at the Holdings
level that is shared with NEP's Canadian subsidiary (of which 240
million was available as of March 31, 2017) and a $150 million
facility at the NET pipeline (which is fully used) and which
Moody's see as being dedicated to the pipeline project.
NEP's liquidity is somewhat lower than its yieldco peers. NRG
Yield, Inc. (Ba2 stable) and Pattern Energy Group Inc. (Ba3 stable)
have significantly larger revolvers of $495 million and $500
million, respectively. However, both companies use their revolving
credit facility to finance acquisitions on a temporary basis before
raising long-term debt or equity financing. Moody's expects that
NEP will raise long-term capital prior to acquiring new assets,
which implies a much lower need for liquidity than other yieldcos.
To the extent that NEP also chooes to use its revolver to financ
acquisitions, Moody's assumes that the revolver will be upsized to
appropriately incorporate the size of NEP's business and its
liquidity needs when the company begins operating more
independently of NextEra.
The principal methodology used in these ratings was Unregulated
Utilities and Unregulated Power Companies published in May 2017.
NEXTERA ENERGY: S&P Assigns 'BB' CCR; Outlook Stable
----------------------------------------------------
S&P Global Ratings said it assigned its 'BB' corporate credit
rating to NextEra Energy Partners L.P. The outlook is stable.
The stable outlook reflects S&P's expectation that NEP's portfolio
of generation facilities will continue to operate under long-term
contracts with mostly investment-grade counterparties and generate
fairly predictable cash flows to support its holding-company debt
obligations.
"We expect the company to manage its base-case adjusted debt to
EBITDA at 5x and FFO to debt at 15%-16%," said S&P Global credit
analyst Michael Ferguson. "While debt to EBITDA would increase
incrementally upon an asset purchase, we expect leverage levels to
drop within a quarter to the 5x level. Finally, we expect any new
acquisition to be in generation assets of a similar nature and
contracted long term."
S&P Global Ratings would lower the ratings if adjusted run-rate
debt to EBITDA increases above 5.25x and if the FFO-to-debt ratio
consistently falls below 14% over S&P's outlook period. This could
result from a significant reduction in cash flows from the
company's projects as a result of a decline in operating
performance and asset reliability, higher-than-expected operating
costs, unfavorable weather events, or increased leverage at the
corporate level.
S&P could raise the ratings on NEP if adjusted debt to EBITDA falls
below 4.75x on a sustained basis or if FFO to debt moves materially
higher and is sustained above 18%. Ratings could also improve over
time as the company's portfolio becomes highly diversified. This
would require less reliance on distributions from NET Holdings, the
largest asset in the portfolio, perhaps through the development or
acquisition of new assets.
NORTHWEST HARDWOODS: S&P Cuts CCR to 'B-' on Weak Credit Metrics
----------------------------------------------------------------
S&P Global Ratings lowered its corporate credit rating on Tacoma,
Wash.-based Northwest Hardwoods Inc. to 'B-' from 'B'. The outlook
is negative.
At the same time, S&P lowered its issue-level rating on the
company's senior secured debt to 'B-' from 'B'. The '4' recovery
rating is unchanged and reflects S&P's expectation for average
(30%-50%; rounded estimate: 35%) recovery in the event of default.
S&P has lowered the rating on Northwest Hardwoods because credit
metrics have weakened significantly. Earnings underperformed our
forecast during the past 12 months primarily due to the company's
inability to source raw materials to adequately grow volumes. The
strengthening of the U.S. dollar and the expiration of the
U.S.-Canada softwood lumber agreement (SLA) made foreign softwood
more cost effective. As a result, Northwest Hardwoods' suppliers
are harvesting less wood, which impairs the company's ability to
fill its supply channels. In the Western U.S., timber companies
typically harvest hardwoods and softwoods simultaneously, so supply
issues in softwood typically affect hardwood supplies as well.
The outlook is negative, which incorporates S&P's expectation that
leverage will remain elevated for the next 12-18 months. S&P
believes the company's capital structure could become unsustainable
if earnings remain weak ahead of its ABL maturity in 2019 and bond
maturity in 2021.
S&P would likely lower our rating in the next 12 months if the
company continued to face raw material supply shortages leading to
debt to EBITDA over 7x and interest coverage at or below 1x. S&P
believes this could indicate that the company's financial
commitments are unsustainable in the long term when the ABL matures
in 2019.
S&P would revise its outlook to stable if EBITDA grew to
approximately $75 million. At this level of EBITDA, leverage would
improve to approximately 6x and interest coverage over 2x, which
S&P believes would improve the company's prospects for refinancing.
NUVERRA ENVIRONMENTAL: Wilmington Trust Opposes Bankr. Plan
-----------------------------------------------------------
Jeff Montgomery, writing for Bankruptcy Law360, reports that
Wilmington Trust N.A., as agent for a noteholder group of Nuverra
Environmental Solutions Inc., asked the Delaware Bankruptcy Court
to terminate a previous order giving the Debtor interim approval to
pay general unsecured claims.
Wilmington Trust argued that the Debtor is proposing an
"impermissible and unconfirmable" Chapter 11 plan that fully pays
general unsecured creditors without providing any cash to holders
of $41 million in notes, Law360 relays.
Wilmington Trust called the Debtors' offer to holders of $41
million in notes to receive 0.25 percent of the Debtors' new common
stock and rights to a proportional share of a $75 million new
equity rights offering as "illusory" and noted that the Debtors can
cancel the offering at any time, Law360 cites.
About Nuverra Environmental
Nuverra Environmental Solutions, Inc. (OTCQB: NESC) provides
environmental solutions to customers focused on the development and
ongoing production of oil and natural gas from shale formations.
The Scottsdale, Arizona-based Company operates in shale basins
where customer exploration and production activities are
predominantly focused on shale and natural gas.
Nuverra Environmental Solutions and its affiliates sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 17-10949) on May 1,
2017. The Hon. Kevin J. Carey presides over the cases.
As of March 31, 2017, Nuverra had $342.6 million in total assets
and $534.5 million in total liabilities.
Shearman & Sterling LLP serves as bankruptcy counsel to the
Debtors, with the engagement led by Fredric Sosnick, Esq., Sara
Coelho, Esq., and Stephen M. Blank, Esq. Young Conaway Stargatt &
Taylor, LLP and Shearman & Sterling LLP is the Debtors' co-counsel.
AP Services, LLC, is the Debtors' restructuring advisor. Lazard
Freres & Co. LLC and Lazard Middle Market LLC is the investment
banker. Prime Clerk LLC is the claims and noticing agent.
On May 19, 2017, the U.S. Trustee appointed an official committee
of unsecured creditors. Kilpatrick Townsend & Stockton LLP is
counsel and Batuta Capital Advisors LLC is financial advisor to the
Committee. Landis Rath & Cobb LLP serves as Delaware counsel.
OCEAN STATE THEATRE: June 30 Hearing to Name Permanent Receiver
---------------------------------------------------------------
Brian P. Stern, Associate Justice of the Kent County Superior
Court, in Rhode Island, appointed Linda Rekas Sloan, Esq., of
Providence, as Temporary Receiver of Ocean State Theatre Company,
Inc.
A Citation is to be issued to the Defendant, returnable to the Kent
County Superior Court sitting at 222 Quaker Lane, Warwick, Rhode
Island on June 30, 2017, at 9:30 a.m. at which time and place this
cause is set down for hearing on the prayer for the Appointment of
a Permanent Receiver.
The Court's Order says the Receiver is required to file a bond in
the sum of $5,000 with any surety company authorized to do business
in the State of Rhode Island as surety thereon, conditioned that
the Receiver will well and truly perform the duties of said office
and duly account for all monies and property which may come into
the Receiver's hands and abide by and perform all things which the
Receiver will be directed to do by the Kent, Rhode Island Superior
Court.
The Receiver is authorized to take possession and charge of all of
the estate, assets, effects, property and business of the
Defendant, to collect all of the debts and property belonging to it
and to preserve the same until further Court order.
The Receiver is authorized until further Court Order, in the
Receiver's discretion and as the Receiver deems appropriate and
advisable, to conduct the business of the Defendant, to borrow
money from time to time, to purchase, for cash or upon credit,
merchandise, materials and other property, to engage appraisers
and/or employees and assistants, clerical or otherwise, and to pay
all such individuals and entities in the usual course of business,
and to do and perform or cause to be done and performed all other
acts and things as are appropriate in the premises.
Pursuant to and in compliance with Rhode Island Supreme Court
Executive Order No. 2002-2, the Superior Court said it finds the
designation of the Receiver as warranted and required because of
the Receiver's specialized expertise and experience in operating
businesses in Receivership and in administrating non-routine
Receiverships which involve unusual or complex legal, financial, or
business issues.
The commencement, prosecution, or continuance of the prosecution,
of any action, suit, arbitration proceeding, hearing, or any
foreclosure, reclamation or repossession proceeding, both judicial
and non-judicial, or any other proceeding, in law, or in equity or
under any statute, or otherwise, against the Defendant or any of
its property, in any Court, agency, tribunal, or elsewhere, or
before any arbitrator, or otherwise by any creditor, stockholder,
corporation, partnership or any other person, or the levy of any
attachment, execution or other process upon or against any property
of said Defendant, or the taking or attempting to take into
possession any property in the possession of the Defendant or of
which the Defendant has the right to possession, or the
interference with the Receiver's taking possession of or retaining
possess of any such property, or the cancellation at any time
during the Receivership proceeding of any insurance policy, lease
or other contract with Defendant, by any of such parties as
aforesaid, other than the Receiver designated as aforesaid, or the
termination of telephone, electric, gas or other utility service to
Defendant, by any public utility, without obtaining prior approval
thereof from the Court, in which connection the Receiver shall be
entitled to prior notice and an opportunity to be heard, are
restrained and enjoined until further Court Order.
The Receivership case is, Amiee Turner, in her capacity as
President of Ocean State Theatre Company, Inc., Plaintiff vs. Ocean
State Theatre Company, Inc. Defendant KC 2017-0603, State of Rhode
Island, Superior Court of Kent County.
OCONEE REGIONAL: Hires Bryan Cave as Bankruptcy Counsel
-------------------------------------------------------
Oconee Regional Health Systems, Inc., et al. seek authority from
the United States Bankruptcy Court for the Middle District of
Georgia, Macon Division, to employ Bryan Cave LLP as its bankruptcy
counsel, nunc pro tunc to May 10, 2017.
Services to be provided by Bryan Cave are:
a. advise, assist, and represent the Debtors with respect to
its rights, powers, duties, and obligations in the administration
of these Chapter 11 cases, the disposition of assets, the
management of the Debtors estates, and the collection,
preservation, and administration of assets;
b. advise, assist, and represent the Debtors in connection
with all applications, motions, or complaints concerning the
Debtors or their assets;
c. advise, assist, and represent the Debtors in connection (i)
with any sale or other dispositions of any assets of the estates,
including, without limitation, the investigation and analysis of
the alternative methods of effecting same; (ii) employment of
investment bankers or other professionals to assist with regard the
case; (iii) negotiations with prospective purchasers; (iv) the
drafting of appropriate contracts, instruments of conveyance, and
other documents with regard to the case; (v) the preparation,
filing, and service as required of appropriate motions, notices,
and other pleadings that are necessary; and (vi) the representation
in connection with the consummation and closing of any such
transaction, provided, however, that the Debtors' long-term general
corporate counsel, James-Bates-Brannon-Groover LLP, played a larger
role in negotiating and documenting the terms of the current
proposed sale of the Debtors' assets, in addition to duties such as
board advice, dealing with Jasper, and related items, and so
for purposes of efficiency, the Debtors will be filing an
application to retain James-Bates as special corporate counsel to
continue in those roles post-petition;
d. to the extent creditor support can be had for a confirmable
plan, assist the Debtors in all matters relating to plan drafting
and prosecution;
e. support and assist the Debtors with regard to the proper
receipt, disbursement, and accounting for funds and property of the
estates;
f. provide legal services of any nature as may be required by
the Debtors in conducting the affairs of the estates, protecting
the estates’ assets, or in other necessary or appropriate
activity;
g. prepare pleadings, applications, motions, reports, and
other papers incidental to the administration of these Chapter 11
cases; and
h. represent the Debtor in any other matter arising as part of
the Debtors' statutory duties.
Prior to the Petition Date, and since its retention in early March
of 2017, Bryan Cave billed and collected $246,925 in fees and
$4,077.63 in expenses, billing on an approximately
weekly basis.
The principal attorneys designated to represent the Debtor and
their current hourly rates are:
Attorney Title Hourly Rate
Mark I. Duedall Partner $440
Michael Cooley Counsel $510
Leah Fiorenza McNeill Associate $470
Deborah Field Paralegal $310
Mark I. Duedall, partner with Bryan Cave LLP, attests that his firm
does not represent any other entity having an adverse interest in
connection with the Debtors' Chapter 11 cases.
The Firm can be reached through:
Mark I. Duedall
Leah Fiorenza McNeill
BRYAN CAVE LLP
One Atlantic Center, Fourteenth Floor
1201 W. Peachtree Street, NW
Atlanta, GA 30309-3471
Tel: (404) 572-6600
Fax: (404) 572-6999
Email: Mark.Duedall@bryancave.com
Leah.Fiorenza@bryancave.com
About Oconee Regional Medical Center
Oconee Regional Medical Center (ORMC) is located in Milledgeville
near the geographic center of Georgia, providing advanced
healthcare technologies to the 90,000 residents living in the seven
surrounding counties.
Oconee Regional Health Systems, Inc., owner of the Oconee Regional
Medical Center, and six of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. M.D. Ga.) on May 10, 2017. The six
affiliates are Oconee Regional Medical Center, Inc. (Case No.
17-51006), Oconee Regional Health Services, Inc. (Case No.
17-51007), Oconee Regional Emergency Medical Services, Inc. (Case
No. 17-51008), Oconee Regional Health Ventures, Inc., dba Oconee
(Case No. 17-51009), Oconee Internal Medicine, LLC (Case No.
17-51010), and Oconee Orthopedics, LLC (Case No. 17-51011).
Two more affiliates sought bankruptcy protection on May 11, 2017.
These affiliates are ORHV Sandersville Family Practice, LLC (Case
No. 17-51012), and Oconee Regional Senior Living, Inc. (Case No.
17-51013).
The petitions were signed by Steven M. Johnson, interim chief
executive officer.
The Debtors are represented by Mark I. Duedall, Esq., and Leah
Fiorenza McNeill, Esq., in Atlanta, Georgia.
The Debtors' special counsel is James-Bates-Brannan-Groover-LLP,
while the Debtors' investment banker is Houlihan Lokey.
Grant Thornton is the Debtors' financial advisor.
OLIVER C&I: Taps Nelson Robles-Diaz as Special Counsel
------------------------------------------------------
Oliver C & I Corp. seeks approval from the U.S. Bankruptcy Court
for the District of Puerto Rico to hire Nelson Robles-Diaz Law
Offices, P.S.C. as special counsel.
The firm will represent the Debtor in an adversary proceeding
against D Group Capital Corporation and 14 other corporate entities
with at least nine causes of action to collecf sums. Nelson will
also prosecute avoidance of transfers and request of damages caused
for violation of partnership agreements.
The hourly rates charged by the firm are:
Nelson Robles-Diaz $225
Junior Attorney $125
Paralegals/Law Clerks $40 - $50
The firm received a retainer from the Debtor in the amount of
$8,000.
Nelson Robles-Diaz Esq., disclosed in a court filing that he is a
"disinterested person" as defined in section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Nelson Robles-Diaz, Esq.
Nelson Robles-Diaz Law Offices, P.S.C.
P.O. Box 192302
San Juan , PR 00912
Tel: (787) 294-9518
Fax: (787) 294-9519
Email: nroblesdiaz@gmail.com
About Oliver C & I Corp.
Oliver C & I Corp., based in Guaynabo, Puerto Rico, filed a Chapter
11 petition (Bankr. D.P.R. Case No. 16-08311) on October 17, 2016.
The petition was signed by Max Olivera, vice-president and
treasurer. The case is assigned to Judge Mildred Caban Flores. In
its petition, the Debtor indicated $29.94 million in total assets
and $1.06 million in total liabilities.
The Debtor is represented by Carmen D. Conde Torres, Esq. at C.
Conde & Assoc. The Debtor employed Doris Barroso Vicens of RSM
Puerto Rico as its accountant; and Aurora Oti-Yvonnet of Villafane
& Oti, Certified Public Accountants, PSC, as its external auditor.
OMINTO INC: Director Mitch Hill Named Executive Chairman
--------------------------------------------------------
Ominto, Inc., announced that the Company's Board of Directors has
appointed Mitch Hill as executive chairman of the Board. Mr. Hill
will continue his work with Michael Hansen and the Board to provide
leadership in developing and executing the Company's business
strategy.
Mr. Hill has served on the Company's Board of Directors since May
of 2015 and as an executive director since June of 2016. He also
served as the Company's interim CEO during the first six months of
2016.
Mr. Hill has C-level executive experience in a number of public and
private companies including real estate, entertainment, healthcare
and e-commerce. Earlier in his career, he was president and CFO of
Buy.com Inc., a high-profile pioneer in early e-commerce solutions,
which is now part of Rakuten, Inc. Prior to Buy.com, Mr. Hill
served in a financial executive capacity for the Walt Disney
Company and worked in the investment banking division of Goldman
Sachs. Throughout his career he has supported startup launches,
and has transformed companies from R&D phases and private
capitalization to commercialization with manufacturing, marketing
and sales, including preparation for IPO. Mr. Hill received his
MBA from the Harvard Business School and his BS from Brigham Young
University.
Commenting on the announcement, Mr. Hansen stated, "I look forward
to continuing to work with Mitch. We appreciate the strategic,
financial and transactional expertise he contributes to the
company."
About Ominto, Inc.
Ominto, Inc. is a global e-commerce leader and pioneer of online
Cash Back shopping, delivering value-based shopping and travel
deals through its primary shopping platform and affiliated Partner
Program websites. At DubLi.com or at Partner sites powered by
Ominto.com, consumers shop at their favorite stores, save with the
best coupons and deals, and earn Cash Back with each purchase. The
Ominto.com platform features thousands of brand name stores and
industry-leading travel companies from around the world, providing
Cash Back savings to consumers in more than 120 countries.
Ominto’s Partner Programs offer a white label version of the
Ominto.com shopping and travel platform to businesses and
non-profits, providing them with a professional, reliable web
presence that builds brand loyalty with their members, customers or
constituents while earning commission for the organization and Cash
Back for shoppers on each transaction. For more information,
please visit Ominto's corporate website http://inc.ominto.com.
Ominto reported a net loss of $10.30 million for the year ended
Sept. 30, 2016, compared to a net loss of $11.69 million for the
year ended Sept. 30, 2015. As of March 31, 2017, Ominto had $68.62
million in total assets, $48.03 million in total liabilities and
$20.58 million in total stockholders' equity.
OUTER HARBOR: Committee Appeals Decision Denying Ch. 7 Plan Probe
-----------------------------------------------------------------
Ryan Boysen, writing for Bankruptcy Law360, reports that the
Committee of Unsecured Creditors of defunct Outer Harbor LLC have
filed an appeal on the U.S. Bankruptcy Court for the District of
Delaware's decision denying them an opportunity to challenge the
Debtor's Chapter 7 liquidation plan over $25 million in the
Debtor's suspicious prepetition payments.
According to Law360, the Committee sought to challenge the plan and
investigate the payments, made to affiliates of the Debtor's parent
company and debtor-in-possession lender HHH Oakland Inc., in the
hopes of clawing back some of the money to pay the $7 million to
$12.5 million in unsecured claims the Debtor owed.
Law360 recalls that the Court denied the Committee's request to
challenge the plan on May 5 because the court order that authorized
the DIP loan required challenges to be brought within 75 days,
which elapsed before the Committee was even formed.
About Outer Harbor Terminal
Outer Harbor Terminal, LLC -- aka Ports America Outer Terminal,
LLC, PAOH, and PAOHT -- was a joint venture of Ports America and
Terminal Investment Ltd. The Oakland, California-based port
operator filed for Chapter 11 protection (Bankr. D. Del. Case No.
16-10283) on Feb. 1, 2016. It announced plans to wind down
operations and leave Oakland to concentrate on its investments in
other terminals that the company operates in Tacoma, Los
Angeles-Long Beach, New York-New Jersey and Baltimore.
The Chapter 11 petition was signed by Heather Stack, chief
financial officer. The Hon. Laurie Selber Silverstein is the case
judge. The Debtor listed $103 million in assets and $370 million
in debt.
Milbank, Tweed, Hadley & Mccloy LLP is the Debtor's general
counsel. Mark D. Collins, Esq., at Richards, Layton & Finger,
P.A., serves as its Delaware counsel. Prime Clerk LLC is the
claims and noticing agent.
P & L GAS: To Pay IRS Monthly Installments, Plus 12% for 5 Yrs.
---------------------------------------------------------------
P & L Gas Dispensers, LLC, filed with the U.S. Bankruptcy Court for
the Southern District of Texas a second amended plan of
reorganization and disclosure statement.
Class 7 Allowed Unsecured Priority Claim of the Internal Revenue
Service is impaired by the Plan. The IRS is the holder of a
priority claim in the amount of $60,291.09. The IRS will retain
its liens, if any, on the Debtor's property for pre-petition taxes
and will receive payment by the Reorganized Debtor in monthly
installments for a period of 60 months from the petition date, with
interest at 12% in full payment of its claims due as of the
Effective Date.
A copy of the Second Amended Plan and Disclosure Statement is
available at http://bankrupt.com/misc/txsb16-30165-79.pdf
As reported by the Troubled Company Reporter on Dec. 12, 2016, the
Debtor filed with a first amended plan of reorganization and
disclosure statement, which stated that on the 90th day following
the Effective Date and every 90 days thereafter, the Reorganized
Debtor would make a contribution of $7,200 to an escrow account for
the benefit of the holders of Class 11 Allowed Unsecured Claims.
About P & L Gas
P & L Gas Dispensers LLC was originally opened as P & L Maintenance
as a sole proprietorship with Pedro Gonzalez Navarro as owner. In
2003 the company became P & L Gas Dispensers, LLC, with Mr. Navarro
as the manager of the Debtor, and sole member.
The Debtor filed a Chapter 11 bankruptcy petition (Bankr. S.D. Tex.
Case No. 16-30165) on Jan. 5, 2016. The Debtor is represented by
James Patrick Brady, Esq., at Brady Law Firm.
PACKAGING COORDINATORS: Moody's Cuts CFR to B3; Outlook Stable
--------------------------------------------------------------
Moody's Investors Service downgraded Packaging Coordinators Midco,
Inc.'s (PCI) Corporate Family Rating to B3 from B2. Actions on
other ratings are detailed below. The rating outlook remains
stable.
The downgrade reflects the company's weak financial performance
since the 2016 LBO by affiliates of Partners group. Manufacturing
disruptions associated with shifting production between facilities
and initiatives to support product serialization has resulted in
earnings declines. As a result, leverage has increased and is now
approaching 8 times. While the company has taken actions to improve
operations such that leverage should improve, Moody's expects
leverage to remain above 6 times for an extended period.
The following ratings were downgraded:
Packaging Coordinators Midco, Inc.
Corporate Family Rating to B3 from B2
Probability of Default Rating to B3-PD from B2-PD
Backed Senior Secured First Lien Revolving Credit Facility to B2
(LGD 3) from B1 (LGD3)
Backed Senior Secured First Lien Term Loan to B2 (LGD 3) from B1
(LGD3)
Backed Senior Secured Second Lien Term Loan to Caa2 (LGD 5) from
Caa1 (LGD5)
Rating outlook is stable
The B3 Corporate Family Rating (CFR) reflects PCI's modest size,
both on an absolute basis and relative to several much larger
competitors, high financial leverage and aggressive financial
policy. The ratings also incorporate Moody's expectation that the
company will pursue bolt-on acquisitions which may further increase
PCI's already high adjusted debt to EBITDA. Debt/EBITDA as of March
31, 2017 was near 8.0x. While Moody's expects leverage to improve
over the next year as the company has addressed recent production
challenges leverage will remain above 6x. The rating is also
constrained by the risk of revenue losses either due to patent
expirations of customers' products or selective in-sourcing by
customers. PCI benefits from its leading position among contract
packaging services companies, and its relatively well-diversified
customer base consisting largely of blue-chip pharmaceutical
clients. Moody's expects that PCI's growth will be supported by
favorable industry tailwinds, as the pharmaceutical industry will
continue to increase its reliance on outsourced service providers.
The company also maintains a good liquidity profile with positive
free cash flow, access to a substantially undrawn $65 million
revolver and a benign debt maturity profile with no debt coming due
until 2021.
The stable rating outlook reflects the company's good liquidity
profile and that leverage is expected to improve over the next 12
to 18 months.
Ratings could be upgraded if the company can profitably grow market
share and maintain good product and customer diversity and
operating margins recover toward historical levels. Ratings could
be upgraded if debt/EBITDA is sustained below 6 times.
Ratings could be downgraded if the company were to experience
continued operating disruptions or loss of major contracts. Ratings
could be downgraded if free cash flow were to turn negative or
interest coverage fell below one times, or if the company's
liquidity profile were to erode.
Packaging Coordinators Midco, Inc. (PCI) is a global provider of
outsourced pharmaceutical services that include commercial and
clinical packaging, clinical storage and distribution services,
high potency and non-potent drug manufacturing, and selected drug
development and analytical services. For the LTM period ending
March 31, 2017, PCI generated revenue of approximately $500
million. PCI's parent firm and financial statement filer, Pioneer
UK Midco 1 Limited is majority-owned by private equity firm
Partners Group, along with minority stakes by Frazier Healthcare
(owner of legacy PCI) and the management team.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
PARAGON OFFSHORE: Exclusive Plan Filing Deadline Moved to Aug. 4
----------------------------------------------------------------
The Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for
the District of Delaware has extended, at the behest of Paragon
Offshore plc, and its affiliated debtors, the Debtors' exclusive
periods to file a bankruptcy plan and solicit acceptances for that
plan through and including Aug. 4, 2017, and Oct. 3, 2017,
respectively.
As reported by the Troubled Company Reporter on June 7, 2017, the
Debtors sought the extension, which will enable them to move
forward with the confirmation hearing. Since the time the Court
granted their last exclusivity extension on April 28, 2017, the
Debtors have successfully participated in plan mediation with their
three major creditor constituents -- the ad hoc committee of
lenders under Paragon's Senior Secured Term Loan Agreement maturing
July 2021, the steering committee of lenders under Paragon's Senior
Secured Revolving Credit Agreement maturing July 2019, and the
Unsecured Creditors Committee.
About Paragon Offshore
Houston, Texas-based Paragon Offshore plc (OTC: PGNPQ) --
http://www.paragonoffshore.com/-- is a global provider of offshore
drilling rigs. Paragon is a public limited company registered in
England and Wales.
Paragon Offshore Plc, et al., filed Chapter 11 bankruptcy petitions
(Bankr. D. Del. Case Nos. 16-10385 to 16-10410) on Feb. 14, 2016,
after reaching a deal with lenders on a reorganization plan that
would eliminate $1.1 billion in debt. The petitions were signed by
Randall D. Stilley as authorized representative.
Judge Christopher S. Sontchi is assigned to the cases.
The Debtors reported total assets of $2.47 billion and total debt
of $2.96 billion as of Sept. 30, 2015.
The Debtors engaged Weil, Gotshal & Manges LLP as general counsel;
Richards, Layton & Finger, P.A. as local counsel; Lazard Freres &
Co. LLC as financial advisor; Alixpartners, LLP, as restructuring
advisor; PricewaterhouseCoopers LLP as auditor and tax advisor; and
Kurtzman Carson Consultants as claims and noticing agent.
No request has been made for the appointment of a trustee or an
examiner in the cases.
On Jan. 27, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. Paul, Weiss, Rifkind,
Wharton & Garrison LLP serves as main counsel to the Committee and
Young Conaway Stargatt & Taylor, LLP acts as co-counsel. The
committee retained Ducera Partners LLC as financial advisor.
Counsel to JPMorgan Chase Bank, N.A. (a) as administrative agent
under the Senior Secured Revolving Credit Agreement, dated as of
June 17, 2014, and (b) as collateral agent under the Guaranty and
Collateral Agreement, dated as of July 18, 2014, are Sandeep Qusba,
Esq., and Kathrine A. McLendon, Esq., at Simpson Thacher & Bartlett
LLP. PJT Partners serves as its financial advisor.
Delaware counsel to JPMorgan Chase Bank, N.A. are Landis Rath &
Cobb LLP's Adam G. Landis, Esq.; Kerri K. Mumford, Esq.; and
Kimberly A. Brown, Esq.
Counsel to Cortland Capital Market Services L.L.C. as
administrative agent under the Senior Secured Term Loan Agreement,
dated as of July 18, 2014, are Arnold & Porter Kaye Scholer LLP's
Scott D. Talmadge, Esq.; Benjamin Mintz, Esq.; and Madlyn G.
Primoff, Esq.
Delaware counsel to Cortland Capital Market Services L.L.C. are
Potter Anderson & Corroon LLP's Jeremy W. Ryan, Esq.; Ryan M.
Murphy, Esq.; and D. Ryan Slaugh, Esq.
Counsel to Deutsche Bank Trust Company Americas as trustee under
the Senior Notes Indenture, dated as of July 18, 2014, for the
6.75% Senior Notes due 2022 and the 7.25% Senior Notes due 2024,
are Morgan, Lewis, & Bockius LLP's James O. Moore, Esq.; Glenn E.
Siegel, Esq.; and Joshua Dorchak, Esq.
Freshfields Bruckhaus Deringer LLP serves as legal counsel to the
Term Loan Agent and FTI Consulting, Inc. serves as its financial
advisor.
* * *
Paragon Offshore said June 7, 2017, that the Bankruptcy Court has
approved the Company's consensual plan of reorganization. Under
the Consensual Plan, which the Company announced May 2, 2017,
Paragon's existing equity will be deemed worthless and the
company's secured creditors and unsecured bondholders will receive
equity in a new reorganized parent company.
Under the Consensual Plan of Reorganization announced May 2, 2017,
approximately $2.4 billion of previously existing debt will be
eliminated in exchange for a combination of cash and to-be-issued
new equity. If confirmed, the Secured Lenders will receive their
pro rata share of $410 million in cash and 50% of the new,
to-be-issued common equity, subject to dilution. The Bondholders
will receive $105 million in cash and an estimated 50% of the new,
to-be-issued common equity, subject to dilution. The Secured
Lenders and Bondholders will each appoint three members of a new
board of directors to be constituted upon emergence of the Company
from bankruptcy and will agree on a candidate for Chief Executive
Officer who will serve as the seventh member of the board of
directors of the Company.
As a necessary component of the Consensual Plan, Paragon Offshore
filed before the High Court of Justice, Chancery Division,
Companies Court of England and Wales an application for
administration in the United Kingdom and sought an order appointing
two partners of Deloitte LLP as administrators of the company. The
application was granted on May 23, 2017.
Neville Barry Kahn and David Philip Soden were appointed Joint
Administrators of Paragon Offshore Plc on May 23, 2017. The
affairs, business and property of the Company are managed by the
Joint Administrators. The Joint Administrators act as agents of
the Company and contract without personal liability.
PAS REAL ESTATE: Case Summary & 2 Unsecured Creditors
-----------------------------------------------------
Affiliated Debtors that filed separate Chapter 11 bankruptcy
petitions:
Debtor Case No.
------ --------
PAS Real Estate LLC - 17-18808
308 West New Indian Trail
2320 W. Peterson Avenue
Chicago, IL 60606
PAS Real Estate LLC - 1460 W Larkin 17-18809
2320 W. Peterson Avenue
Chicago, IL 60606
Business Description: Single Asset Real Estate (as defined in 11
U.S.C. Section 101(51B))
Chapter 11 Petition Date: June 22, 2017
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Donald R Cassling (17-18808)
Hon. Benjamin A. Goldgar (17-18809)
Debtors' Counsel: Penelope N Bach, Esq.
BACH LAW OFFICES
P.O. Box 1285
Northbrook, IL 60065
Tel: 847 564-0808
Fax: 847 564-0985
E-mail: pnbach@bachoffices.com
Estimated Estimated
Assets Liabilities
---------- -----------
PAS 308 West $0-$50K $1M-$10M
PAS 1460 W Larkin $500K-$1M $1M-$10M
The petition was signed by Aref Senno, managing member. Aref and
Pauline Senno sought bankruptcy protection (Bankr. N.D. Ill. Case
No. 17-14412) on May 8, 2017.
PAS Real Estate LLC - 308 West's list of two unsecured creditors is
available for free at:
http://bankrupt.com/misc/ilnb17-18808.pdf
PAS Real Estate LLC - 1460 W Larkin's list of two unsecured
creditors is available for free at:
http://bankrupt.com/misc/ilnb17-18809.pdf
PATTERN ENERGY: S&P Affirms 'BB-' CCR on Strategic Initiatives
--------------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' long-term corporate credit
rating on San-Francisco-based Pattern Energy Group Inc. (PEGI). The
outlook is stable.
At the same time, S&P Global Ratings affirmed its 'BB-' issue-level
rating on the company's $350 million senior unsecured notes due
2024. The '4' recovery rating on the notes is unchanged, and
indicates lenders can expect average (30% to 50%; rounded estimate
35%) recovery in a default scenario.
The affirmation reflects S&P's view that, while PEGI's recently
announced strategic initiatives will result in a temporary increase
in leverage as the company uses the revolving credit facility to
fund the announced dropdown, S&P expects PEGI to issue equity to
pay down the line of credit by the end of 2017. S&P therefore sees
no change to its aggressive financial risk profile assessment. In
addition, S&P believes the announced strategic initiative has a
neutral impact on the company's business risk profile.
The stable outlook reflects S&P's expectation that PEGI's portfolio
of wind power generation facilities will continue to operate under
long-term contracts with investment-grade counterparties, and
generate fairly predictable cash flows to support its
holding-company debt obligations. S&P expects the company to grow
through a mix of equity and debt financing and expect it to make
judicious use of the revolver, with the revolver prefunding any
acquisitions followed by the necessary and timely equity
financing.
A downgrade could occur if the FFO-to-debt ratio consistently falls
below 13% over S&P's outlook period. This could result from a
significant reduction in cash flows from PEGI's projects as a
result of a decline in operating performance and asset reliability,
higher-than-expected operating costs, unfavorable weather events,
or increased leverage at the corporate level. The rating could
also come under pressure if the company uses its revolver to fund
dropdowns without a credible commitment to raise equity within a
short period. Using a very large share of the revolver to support
a dropdown could result in a downgrade.
S&P would consider upgrading PEGI if FFO-to-debt moves materially
higher and stays above 20%. This could result from increased cash
flows from new projects or new acquisitions or deleveraging by
paying down the credit facility or low credit facility balances.
PERFUMANIA HOLDINGS: In Talks With Nussdorfs on Restructuring
-------------------------------------------------------------
Perfumania Holdings, Inc., announced that a special independent
committee of the Board of Directors of the Company is considering
various alternatives to address the Issuer's financial condition
and capital structure, and had contacted members of the Nussdorf
family (Stephen L. Nussdorf, Glenn H. Nussdorf, Arlene Nussdorf,
Lillian Ruth Nussdorf) to begin discussions over possible
alternatives that could result in value to all stockholders of the
Company.
The Family is considering potential alternatives in connection with
a potential restructuring of the operations and capital structure
of the Issuer and/or its subsidiaries in which, among other things,
members of the Family or related persons would make an investment
in the shares of common stock of the Issuer. Any such
restructuring could encompass a restructuring of the Issuer's
subsidiary retail operations, subject to the satisfaction of the
Family members as to the terms and conditions thereof. Moreover,
such alternatives could potentially involve the payment by the
Issuer of up to $2.00 in cash to stockholders of the Issuer (other
than members of the Family, and their respective affiliates) in a
restructuring in which members of the Family would potentially be
the sole stockholders of the Issuer after the consummation of such
restructuring. There can be no assurance that there will be any
restructuring of the Issuer and/or its subsidiaries, that any
restructuring will be agreed upon by the members of the Family, or
of the terms and conditions of any such restructuring (including
without limitation any such payment to the stockholders), and any
such restructuring is and would be subject to the agreement of all
terms and conditions by the members of the Family, the Issuer and
various third parties.
Other than as set forth above, Stephen and Glenn Nussdorf and other
members of the Family do not have current plans or proposals to
acquire or dispose of additional securities of the Issuer, or to
change the present board of directors or management of the Issuer
or any of its subsidiaries.
As of June 19, 2017, these reporting persons disclosed beneficial
ownership of shares of shares of common stock stock, $0.01 par
value, of Perfumania Holdings, Inc. as of June 19, 2017:
Shares Percentage
Beneficially of
Name Owned Shares
---- ------------ -----------
Glenn H. Nussdorf 4,113,220 25.81%
Stephen L. Nussdorf 3,021,132 18.66%
Lillian Ruth Nussdorf 133,333 0.86%
A full-text copy of the Schedule 13D/A is available for free at:
https://is.gd/0pCQVk
About Perfumania Holdings
Perfumania Holdings, Inc. (NASDAQ: PERF) --
http://www.perfumaniaholdings.com/or perf@jcir.com -- is a
specialty retailer and distributor of fragrances and related beauty
products across the United States. Perfumania has a 30-year
history of innovative marketing and sales management, brand
development, license sourcing and wholesale distribution making it
the premier destination for fragrances and other beauty supplies.
Perfumania reported a net loss of $23.63 million for the fiscal
year ended Jan. 28, 2017, following a net loss of $11.67 million
for the fiscal year ended Jan. 30, 2016. As of April 29, 2017,
Perfumania had $304.73 million in total assets, $253.93 million in
total liabilities and $50.80 million in total shareholders' equity.
PERFUMANIA HOLDINGS: Incurs $9.65 Million Net Loss in 1st Quarter
-----------------------------------------------------------------
Perfumania Holdings, Inc. filed with the Securities and Exchange
Commission its quarterly report on Form 10-Q disclosing a net loss
of $9.65 million on $97.89 million of net sales for the 13 weeks
ended April 29, 2017, compared to a net loss of $6.41 million on
$105.13 million of net sales for the 13 weeks ended April 30,
2016.
As of April 29, 2017, Perfumania had $304.73 million in total
assets, $253.93 million in total liabilities and $50.80 million in
total shareholders' equity.
Net cash used in operating activities during the thirteen weeks
ended April 29, 2017, was approximately $9.5 million, compared with
approximately $0.7 million used in operating activities during the
thirteen weeks ended April 30, 2016. This increase in cash used in
operations results from the increase in the Company's net loss and
changes in its working capital. The seasonality of the Company's
operations may lead to significant fluctuations in certain asset
and liability accounts between fiscal year-end and subsequent
interim periods.
Net cash used in investing activities was approximately $0.3
million in the thirteen weeks ended April 29, 2017, compared to
$0.8 million in the thirteen weeks ended April 30, 2016. Investing
activities during the thirteen weeks ended April 29, 2017,
consisted of corporate and information technology enhancements.
The decrease in cash used in investing activities resulted from
less information technology spending during the thirteen weeks
ended April 29, 2017, versus last year's comparative period and no
new Perfumania store openings during the thirteen weeks ended April
29, 2017, compared with the thirteen weeks ended April 30, 2016.
During the thirteen weeks ended
April 29, 2017, Perfumania did not open any new stores and closed
47 stores compared with one new store and 11 store closures during
the thirteen weeks ended April 30, 2016. The Company plans to open
one store and continue to close under-performing stores during the
remainder of fiscal 2017. The Company continues to evaluate the
need to close, remodel or relocate existing stores.
Net cash provided by financing activities during the thirteen weeks
ended April 29, 2017, was approximately $4.2 million, compared with
$1.3 million used in financing activities for the thirteen weeks
ended April 30, 2016. The $5.5 million increase in cash provided
by financing activities is due primarily to higher borrowings under
the Company's bank line of credit. Its borrowings under its line
of credit increased due to the increase in the Company's net loss
and the timing of payments to trade vendors during the thirteen
weeks ended April 29, 2017, compared with the thirteen weeks ended
April 30, 2016.
The Company has a $175 million revolving credit facility with a
syndicate of banks, which is used for the Company's general
corporate purposes and those of its subsidiaries, including working
capital. The Company and certain of its subsidiaries are
co-borrowers under the Senior Credit Facility, and the Company's
other subsidiaries have guaranteed all of their obligations
thereunder. The Company was in compliance with all financial and
operating covenants under the Senior Credit facility as of
April 29, 2017. As of April 29, 2017, the Company had $80.1
million available to borrow under the Senior Credit Facility which
includes $25 million for letters of credit, based on the borrowing
base at that date.
The Company has various unsecured notes payable outstanding to
affiliates which in aggregate total $125.4 million of principal. No
payments of principal may be made on any of these notes payable to
affiliates before the maturity of the Senior Credit Facility
although interest payments are permitted under certain conditions.
"Our liquidity is impacted by a number of factors, including our
sales levels, the amount of credit that our vendors extend to us
and our borrowing capacity under our Senior Credit Facility. Our
principal funding requirements are for inventory purchases,
financing extended terms on accounts receivable, paying down
accounts payable and debt, information system enhancements, and to
a lesser extent, opening new stores and renovation of existing
stores. These capital requirements generally have been satisfied
through borrowings under the Senior Credit Facility and funds from
operations. Based on current internal sales and cash flow
projections, current vendor payable support and our projected
available borrowing capacity under our Senior Credit Facility, as
well as other initiatives to maximize cash flow, we believe that
these resources will be adequate to meet our requirements in both
the short and long-term.
"In addition to the work on operational strategies described above,
we have announced that a special committee of our independent
directors is considering various alternatives to address the
Company's financial condition. The special committee is
considering the Company’s capital structure and possible
alternatives that could result in value to all shareholders, and
has contacted members of the Nussdorf family, our principal
shareholders, to begin discussions over possible approaches. The
Company does not have a defined timeline for the strategic review
process, and there can be no assurance that it will result in any
strategic alternative being announced or consummated."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/hIalwk
About Perfumania Holdings
Perfumania Holdings, Inc. (NASDAQ: PERF) --
http://www.perfumaniaholdings.com/or perf@jcir.com -- is a
specialty retailer and distributor of fragrances and related beauty
products across the United States. Perfumania has a 30-year
history of innovative marketing and sales management, brand
development, license sourcing and wholesale distribution making it
the premier destination for fragrances and other beauty supplies.
Perfumania reported a net loss of $23.63 million for the fiscal
year ended Jan. 28, 2017, following a net loss of $11.67 million
for the fiscal year ended Jan. 30, 2016.
PERFUMANIA HOLDINGS: Nussdorf Reports 13.7% Stake as of June 19
---------------------------------------------------------------
In an amended Schedule 13D filed with the Securities and Exchange
Commission, Arlene Nussdorf disclosed that as of June 19, 2017, she
beneficially owns 2,189,201 shares of common stock of Perfumania
Holdings, Inc. representing 13.74 percent of the shares
outstanding.
On May 26, 2017, Perfumania announced that a special independent
committee of the Board of Directors of the Company is considering
various alternatives to address the Company's financial condition
and capital structure, and had contacted members of the Nussdorf
family (Stephen L. Nussdorf, Glenn H. Nussdorf, Arlene Nussdorf,
Lillian Ruth Nussdorf) to begin discussions over possible
alternatives that could result in value to all stockholders of the
Company.
"The Family is considering potential alternatives in connection
with a potential restructuring of the operations and capital
structure of the Issuer and/or its subsidiaries in which, among
other things, members of the Family or related persons would make
an investment in the shares of common stock of the Issuer. Any
such restructuring could encompass a restructuring of the Issuer's
subsidiary retail operations, subject to the satisfaction of the
Family members as to the terms and conditions thereof. Moreover,
such alternatives could potentially involve the payment by the
Issuer of up to $2.00 in cash to stockholders of the Issuer (other
than members of the Family, and their respective affiliates) in a
restructuring in which members of the Family would potentially be
the sole stockholders of the Issuer after the consummation of such
restructuring. There can be no assurance that there will be any
restructuring of the Issuer and/or its subsidiaries, that any
restructuring will be agreed upon by the members of the Family, or
of the terms and conditions of any such restructuring (including
without limitation any such payment to the stockholders), and any
such restructuring is and would be subject to the agreement of all
terms and conditions by the members of the Family, the Issuer and
various third parties."
Other than as set forth above, Arlene Nussdorf and other members of
the Family do not have current plans or proposals to acquire or
dispose of additional securities of the Issuer, or to change the
present board of directors or management of the Issuer or any of
its subsidiaries.
A full-text copy of the regulatory filing is available at:
https://is.gd/OakeTs
About Perfumania Holdings
Perfumania Holdings, Inc. (NASDAQ: PERF) --
http://www.perfumaniaholdings.com/or perf@jcir.com -- is a
specialty retailer and distributor of fragrances and related beauty
products across the United States. Perfumania has a 30-year
history of innovative marketing and sales management, brand
development, license sourcing and wholesale distribution making it
the premier destination for fragrances and other beauty supplies.
Perfumania reported a net loss of $23.63 million for the fiscal
year ended Jan. 28, 2017, following a net loss of $11.67 million
for the fiscal year ended Jan. 30, 2016. As of April 29, 2017,
Perfumania had $304.73 million in total assets, $253.93 million in
total liabilities and $50.80 million in total shareholders' equity.
PETCO ANIMAL : Bank Debt Trades at 8% Off
-----------------------------------------
Participations in a syndicated loan under Petco Animal Supplies is
a borrower traded in the secondary market at 91.98
cents-on-the-dollar during the week ended Friday, June 16, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.38 percentage points from the
previous week. Petco Animal pays 325 basis points above LIBOR to
borrow under the $2.506 billion facility. The bank loan matures on
Jan. 26, 2023 and carries Moody's NR rating and Standard & Poor's B
rating. The loan is one of the biggest gainers and losers among
247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended June 16.
PETSMART INC: Bank Debt Trades at 7% Off
----------------------------------------
Participations in a syndicated loan under Petsmart Inc is a
borrower traded in the secondary market at 92.97
cents-on-the-dollar during the week ended Friday, June 16, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 1.91 percentage points from the
previous week. Petsmart Inc pays 300 basis points above LIBOR to
borrow under the $4.246 billion facility. The bank loan matures on
March 10, 2022 and carries Moody's Ba3 rating and Standard & Poor's
B+ rating. The loan is one of the biggest gainers and losers among
247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended June 16.
PIONEER ENERGY: Current Drilling Utilization Is 83%
---------------------------------------------------
From time to time, senior management of Pioneer Energy Services
meets with groups of investors and business analysts. The Company
prepared slides in connection with management's participation in
those meetings and participation in the 2017 Wells Fargo West Coast
Energy Conference. The slides provide an update on the Company's
operations and certain recent developments, which among others,
include the following:
Drilling
* May utilization was 74%. Current utilization is 83%.
. In the U.S., rigs remain 100% contracted with dayrates
continuing to increase. 16th AC rig upgrade completed
and now working in West Texas.
. In Colombia, four rigs currently working. Anticipate
two additional rigs to be contracted and begin earning
by mid-August.
Production Services
* Well Servicing May utilization was 48% as compared to 43% in
the prior quarter. June month-to-date utilization is 50%.
* Coiled Tubing activity and pricing improving from first
quarter 2017 levels.
* Wireline activity and pricing remains strong.
The slides are available for free at https://is.gd/gSqdFj
About Pioneer Energy
Pioneer Energy Services Corp. provides land-based drilling services
and production services to a diverse group of independent and large
oil and gas exploration and production companies in the United
States and internationally in Colombia. The Company also provides
two of its services (coiled tubing and wireline services) offshore
in the Gulf of Mexico.
Pioneer Energy reported a net loss of $128.39 million in 2016
following a net loss of $155.14 million in 2015. As of March 31,
2017, Pioneer Energy had $708.32 million in total assets, $451.09
million in total liabilities and $257.23 million in total
shareholders' equity.
* * *
As reported by the TCR on March 7, 2016, Moody's Investors Service,
on March 3, 2016, downgraded Pioneer Energy's Corporate Family
Rating (CFR) to 'Caa3' from 'B2', Probability of Default Rating
(PDR) to 'Caa3-PD' from 'B2-PD', and senior unsecured notes to 'Ca'
from 'B3'. "The rating downgrades were driven by the material
deterioration in Pioneer Energy's credit metrics through 2015 and
our expectation of continued deterioration through 2016. The
demand outlook for drilling and oilfield services is extremely
weak, as witnessed by the steep and continued drop in the US rig
count" said Sreedhar Kona, Moody's vice president. "The negative
outlook reflects the deteriorating fundamentals of the services
sector and the likelihood of covenant breaches."
The TCR reported on March 20, 2017, that S&P Global Ratings
affirmed its 'B-' corporate credit rating on Pioneer Energy. The
outlook is negative.
PREMIER DENTAL: S&P Rates $360-Mil. Secured Loans 'B-'
------------------------------------------------------
S&P Global Ratings revised its recovery rating on Premier Dental
Services Inc.'s senior secured credit facility to '4' from '3'
following Premier's proposed upsize of $20 million to the term loan
B and $10 million to the revolving credit facility. S&P rates the
$325 million senior secured term loan B and $35 million revolving
credit facility 'B-'. The '4' recovery rating indicates S&P's
expectation for average (30%-50%; rounded estimate: 45%) recovery
in the event of a payment default.
S&P revised its rounded estimate for recovery to 45% from 50%
because of the higher amount of debt in the capital structure
(estimated about 9% more debt at default) and resulting lower
expectations of recovery for secured lenders.
S&P's 'B-' corporate credit rating and stable outlook on Premier
Dental Services Inc. are unaffected by the upsize.
RECOVERY ANALYSIS
Key analytical factors
-- S&P's recovery analysis assumes that, in a hypothetical
bankruptcy scenario, Premier would reorganize, given its
ability to efficiently deliver dental services.
-- S&P has valued the company on a going-concern basis using a
4.5x multiple of S&P's projected emergence.
-- EBITDA, the same multiple that S&P applies to other dental
service organizations.
-- S&P estimates that, following a default, it assumes the
business is valued on a normalized EBITDA estimated to be
about $41 million.
-- S&P's simulated default scenario contemplates a default in
2019 resulting from reduced Denti-Cal reimbursement rates
and economic pressures limiting the ability of price-
sensitive customers to seek care.
Simulated default assumptions
-- Year of default: 2019
-- EBITDA at emergence: $41 million
-- Implied enterprise value (EV) multiple: 4.5x
Simplified waterfall
-- Net EV (after 5% administrative costs): $175 million
-- First-lien debt claims: $362 million*
-- Recovery expectation: 30%-50%; rounded estimate: 45%
*Includes six months of prepetition interest.
RATINGS LIST
Premier Dental Services Inc.
Corporate Credit Rating B-/Stable/--
Recovery Ratings Revised
To From
Premier Dental Services Inc.
Senior Secured B- B-
Recovery Rating 4 (45%) 3 (50%)
PREMIUM COMMERCIAL: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Premium Commercial Plumbing, Inc.
f/k/a Shadetree Electric of Arkansas, Inc.
4132 Interstate 30 West
Caddo Mills, TX 75135
Business Description: Shadetree Electric Of Arkansas Inc is a
nonresidential building operator whose
principal assets are located at 4717 State
Highway 34 S Greenville, TX 75402.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-32426
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Harlin DeWayne Hale
Debtor's Counsel: Nathan M. Nichols, Esq.
ORENSTEIN LAW GROUP, P.C.
1910 Pacific Ave
Suite 8040
Dallas, TX, TX 75201
Tel: (214) 757-9101
Fax: (972) 764-8110
E-mail: nathan@orenstein-lg.com
- and -
Rosa R. Orenstein, Esq.
ORENSTEIN LAW GROUP, P.C.
1910 Pacific Ave
Suite 8040
Dallas, TX, TX 75201
Tel: (214) 757-9101
Fax: (972)764-8110
E-mail: rosa@orenstein-lg.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Roy Wilcox, president.
The Debtor's list of 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/txnb17-32426.pdf
PRESTIGE INDUSTRIES: Plan Filing Deadline Moved to August 15
------------------------------------------------------------
Judge Kevin Gross of the U.S. Bankruptcy Court for the District of
Delaware extended Prestige Industries, LLC's exclusive periods to
file a Chapter 11 plan and to solicit acceptances of such plan
through August 15, 2017 and October 12, 2017, respectively.
The Troubled Company Reporter has previously reported that the
Debtor asked the Court to extend its exclusive periods contending
that, since the approval of the Sale of its business and
substantially all of its business assets, the Debtor and other
parties in interest -- including the Official Committee of
Unsecured Creditors and the Debtor's remaining secured creditor,
Medley Capital Corporation, as agent for itself and St. Cloud
Capital Partners IV LLC -- had been exploring the appropriate
process to resolve this Chapter 11 case.
The Debtor noted that the sale closed on May 12, 2017. The Debtor
told the Court its remaining assets were substantially limited to
cash -- earmarked for the payment of administrative expenses, wind
down expenses, and reduction of Medley Capital's secured debt --
causes of action, a disputed account receivable, and a potential
earn-out payment of up to $3 million from the purchaser of the
Debtor's business.
The Debtor said that if it would be determined that one or more
viable causes of action lie in favor of the Debtor's estate under
circumstances where the proceeds would benefit creditors in
addition to Medley Capital -- as secured creditor and
super-priority administrative claimant -- a liquidating plan under
which a liquidating trust will be created would appear to be an
appropriate resolution. The Debtor also said that Medley Capital
had expressed a potential willingness to voluntarily share with
other creditors a portion of the proceeds of litigation.
The Debtor stated that if it would determined that no causes of
action exist, the dismissal of the case may be appropriate, after
the resolution and payment of administrative expenses, the
resolution of post-closing matters arising from the Sale, and the
assignment other remaining assets to Medley Capital.
The Debtor contended that it intends to continue to work
cooperatively with the Committee, Medley Capital, the U.S. Trustee
and other parties-in-interest, to fashion a consensual resolution
of the case to be presented to the Court for approval, whether in
the form of a plan or a dismissal.
Furthermore, the Debtor said that it had contemporaneously filed a
motion to establish a claims bar date, but the Debtor believed that
it had a reasonable idea of the universe of claims that will need
to be dealt with under a plan.
About Prestige Industries, LLC
Prestige Industries LLC, based in North Bergen, New Jersey, filed a
Chapter 11 petition (Bankr. D. Del. Case No. 17-10186) on Jan. 30,
2017. The petition was signed by Jonathan Fung, CEO/CFO. The
Debtor is represented by Peter C. Hughes, Esq., at Dilworth Paxson
LLP. The Debtor engaged SSG Advisors, LLC, as its investment
banker. The case is assigned to Judge Kevin Gross. The Debtor
estimated assets and debt at $10 million to $50 million at the time
of the filing.
Andrew Vara, acting U.S. Trustee for Region 3, on Feb. 10 appointed
five creditors of Prestige Industries LLC to serve on the official
committee of unsecured creditors. The Committee hired Lowenstein
Sandler LLP as counsel, Whiteford, Taylor & Preston LLC as Delaware
and conflict counsel, Province, Inc., as financial advisor.
PRIMELINE UTILITY: S&P Affirms 'B' CCR & Revises Outlook to Neg.
----------------------------------------------------------------
S&P Global Ratings revised the outlook on PrimeLine Utility
Services LLC to negative from stable. S&P also affirmed the 'B'
corporate credit rating on the company.
At the same, S&P affirmed its 'B' issue-level rating on PrimeLine's
$60 million revolver due November 2020 and term loan B due November
2022. The '3' recovery rating remains unchanged, indicating S&P's
expectation for meaningful recovery (50%-70%; rounded estimate:
60%) in the event of a payment default.
The outlook revision reflects S&P's view that challenging
conditions within the company's mid-Atlantic electric transmission
segment have contributed to weaker operating performance than
previously expected. Although the company has experienced growth
across its other business lines pro forma for its 2016 acquisitions
(in particular- natural gas and telecommunications), customer
delays in spending and pricing pressure within its mid-Atlantic
transmission segment have more than offset any overall gains.
Although S&P expects improvement within this business over second
half of the year, the negative outlook reflects S&P's belief that
there is at least a one-in-three chance that it could lower its
ratings if weak operating performance persists, in PrimeLine's
electric transmission segment for example, contributing to weaker
than expected credit metrics over the second half of 2017.
The negative outlook on PrimeLine reflects S&P's concerns with
respect the company's underperformance relative to S&P's
expectations over the past few quarters and the potential for
further weakness throughout the rest of the year. Although S&P
expects a pick-up in activity across its electric transmission
segment from existing levels, S&P believes there is at least a
one-in-three chance that it could lower its ratings if credit
metrics deteriorate further.
S&P could lower its rating on PrimeLine within the next 12 months
if the company experiences prolonged weakness in credit measures,
due to softness in its mid-Atlantic electrical transmission
segment, for example. S&P believes that continued weakness in this
business line could put additional pressure on margins, resulting
in sustained leverage above 6x. Alternatively, S&P could lower the
ratings if the company's cash flow generation remains negative,
with limited signs of strengthening over the near-term.
S&P could revise the outlook to stable over the next 12 months if
credit measures rebound, such that leverage trends down below 6x.
This could occur if end-market conditions improve across its
electric transmission segment for example, contributing increased
revenue and stronger EBITDA margins over the second half of 2017.
PUERTO RICO: Bid to Move SUT Dispute to PR Supreme Court Opposed
----------------------------------------------------------------
Objections have been filed against the motion submitted in the
PROMESA Title III cases of the Commonwealth of Puerto Rico and
Puerto Rico Sales Tax Financing Corporation (COFINA), by the Puerto
Rico Funds and the Mutual Fund Group for relief from the automatic
stay to permit the litigation of certain pending motions to certify
questions to the Puerto Rico Supreme Court (the "Certification
Motions") in Lex Claims v. Rosello, No. 3:16-cv-02374-FAB (the "Lex
Claims Action"), and to permit the litigation of any certified
questions before the Puerto Rico Supreme Court.
The objections were filed by:
(1) the Ad Hoc Group of General Obligation Bondholders, composed
of Aurelius Capital Management, LP, Autonomy Capital (Jersey) LP,
FCO Advisors LP, Monarch Alternative Capital LP, Senator Investment
Group LP, and Stone Lion L.P., which collectively hold
approximately $3 billion of bonds issued or guaranteed by the
Commonwealth and backed by a pledge of its good faith, credit, and
taxing power;
(2) Ambac Assurance Corporation, a holder and/or insurer of
approximately $1.3 billion in net accreted value of bonds issued by
COFINA;
(3) the Financial Oversight and Management Board for Puerto
Rico, as the Debtors' representative pursuant to Section 315(b) of
the Puerto Rico Oversight, Management, and Economic Stability Act
("PROMESA").
Mutual funds managed by Oppenheimer Funds, Inc., Franklin Advisers,
Inc., and the First Puerto Rico Family of Funds (the "Mutual Fund
Group,") hold over $3.5 billion in accreted principal amount of
COFINA Bonds and over $2.9 billion in other bonds issued by Puerto
Rico and other territorial instrumentalities, including over $1.8
billion of Puerto Rico general obligation bonds ("GO Bonds").
These COFINA Bonds, like most of the Mutual Fund Group's bond
holdings, are uninsured. The Mutual Fund Group holds bonds on
behalf of hundreds of thousands of individual investors, including
thousands residing in Puerto Rico.
The UBS Family of Funds and the Puerto Rico Family of Funds
(collectively, the "Puerto Rico Funds") hold $613.3 million in
accreted principal amount of senior and subordinate bonds (the
"COFINA Bonds") issued by COFINA, all of which are uninsured. The
shareholders of the Puerto Rico Funds consist of thousands of
residents of Puerto Rico, including many retirees and those nearing
retirement, who have invested their savings in funds holding COFINA
Bonds.
Sales and Use Taxes
A critical legal issue to be determined in the Debtors' Title III
cases is whether and how much of the sales and use taxes imposed by
the Commonwealth are (i) property of the Commonwealth that is
available for distribution to the Commonwealth's creditors or (ii)
property of the COFINA.
In response to its fiscal crisis, the Commonwealth in 2007 created
COFINA as a financing vehicle to issue bonds secured by the
proceeds of a newly created Puerto Rico sales and use tax (the
"SUT"). The Commonwealth transferred legal ownership of a portion
of certain sales and use taxes to COFINA, protecting the SUT
revenues from "clawback" by the Commonwealth.
However, the proposed 10-year fiscal plan proposed by the
Commonwealth and the Oversight Board, however, is premised on the
assumption that all debt and revenue owned by any Commonwealth
instrumentality belongs to the Commonwealth.
Certification Question
The Movants, the Mutual Fund Group and the Puerto Rico Funds, wish
to have the stay lifted to engage in a two-step process outside of
the court overseeing the PROMESA Title III cases: first, to have
briefing in front of a different federal court seeking to certify
to the Puerto Rico Supreme Court a different question, i.e.,
whether the sales and use taxes are "available resources" of the
Commonwealth within the meaning of the Puerto Rico Constitution
(the "Certification Question"), and, if successful, to have the
Certification Question resolved by the Puerto Rico Supreme Court.
Specifically, the Mutual Fund Group and the Puerto Rico Funds want
the stay lifted to permit the litigation of certain pending motions
to certify questions to the Puerto Rico Supreme Court (the
"Certification Motions") in Lex Claims v. Rosello, No.
3:16-cv-02374-FAB (the "Lex Claims Action"), and to permit the
litigation of any certified questions before the Puerto Rico
Supreme Court.
In the Lex Claims lawsuit, the general obligation ("GO")
bondholders of the Commonwealth sought a judgment declaring the
sales-and-use-tax revenues belonging to COFINA and securing its
bonds to be "available resources" of the Commonwealth under the
Puerto Rico Constitution, and requiring that those funds be
transferred, contrary to Puerto Rico statutes, to the Commonwealth
Treasury.
The Mutual Fund Group and the Puerto Rico Funds sought, and were
granted, leave to intervene in the Lex Claims Litigation to defend
the constitutionality of the COFINA structure.
The Puerto Rico Funds, as well as Ambac, moved to certify the
question of the constitutionality of COFINA to the Puerto Rico
Supreme Court -- motions that the U.S. Court of Appeals for the
First Circuit stayed through May 1 under PROMESA Sec. 405 and the
Oversight Board stayed under Title III's automatic stay by filing
petitions for Puerto Rico on May 3 and COFINA on May 5.
P.R. Supreme Court
As Puerto Rico proposed a budget for the fiscal year starting July
1, 2017 which contemplates the use of COFINA's Dedicated Sales Tax
revenues, the Mutual Fund Group and the Puerto Rico Funds believe
that the issue of COFINA's validity must be determined within the
next few months.
"This Court may be able to address the available resources question
in another forum, such as the COFINA Title III case or adversary
proceedings that may be filed in these cases. But no matter how
this Court resolves the issue, it will not be the final word. Any
decision by this Court as to how it believes the Supreme Court of
Puerto Rico would resolve the question of COFINA's
constitutionality under the Puerto Rico Constitution will be
appealed by the disappointed parties. The First Circuit would then
likely be asked to certify the question to the Puerto Rico Supreme
Court. Direct certification, by contrast, allows for a final and
definitive decision in the near term, as the Supreme Court of
Puerto Rico is the final word on matters of Puerto Rico law. Any
approach besides direct certification to Puerto Rico's high court
will be inefficient and will unduly delay the administration of
these Title III cases," Says John K. Cunningham, Esq., at White &
Case, counsel to the Puerto Rico Funds.
Oversight Board Opposes Different Forum
The Oversight Board, in its objection to the Lift Stay Motion, said
that the likelihood of resolving the Commonwealth-COFINA Dispute,
especially by settlement, is materially greater if two designated
agents of the Debtors litigate and negotiate together in the Puerto
Rico District Court, which is overseeing the Title III cases,
rather than having a swarm of creditors on each side of the dispute
litigate the issue in a different forum. Such a procedure for
unitary resolution is what the FOMB has proposed to join the issue
properly and resolve it between the Debtors.
"The resolution of the Certification Question will not resolve the
Commonwealth-COFINA Dispute, which requires the interpretation and
application of federal law. Resolution of the Certification
Question is not dispositive of how PROMESA -- a federal statute --
should be interpreted and applied. Critically, the First Circuit
has ruled that a determination of what constitutes property for
purposes of federal bankruptcy law cannot be impeded by the
idiosyncrasies of local property laws," said Hermann D. Bauer,
Esq., at O'Neill & Borges LLC, counsel to the Oversight Board.
"In addition, Movants are creditors of the Debtors and, as such,
lack standing to raise the Certification Question because the
Debtors themselves own and control their respective claims to the
sales and use taxes. Movants' requested relief would usurp these
causes of action from the Commonwealth and COFINA and allow them to
be litigated improperly by the creditors in some other forum."
"Furthermore, in seeking to lift the automatic stay, Movants
overlook the Rules of the Puerto Rico Supreme Court and its
jurisprudence on certification. First, it is not up to a federal
court to determine whether a Commonwealth court will decide a
certified question; that decision is made by the Commonwealth court
itself. Second, the Puerto Rico Supreme Court does not decide mixed
questions of federal and Commonwealth law. Thus, it is not clear
whether or when the Puerto Rico Supreme Court would decide the
Certification Question."
Landscape Has Changed, Says Ambac
Ambac does not oppose certification generally, nor does it contest
that certification of the "available resources" question to the
Supreme Court of Puerto Rico may be warranted in the appropriate
context. Indeed, as Movants note, Ambac argued in favor of
certification of the "available resources" question in the context
of the Lex Claims Action. But the landscape has changed
dramatically, cautioning strongly against artificially reviving a
stayed GO bondholder suit.
Ambac's attorney, Dennis F. Dunne, Esq., at Milbank, Tweed, Hadley
& Mccloy LLP, explains, "First, any questions of Puerto Rico
constitutional law should be properly presented in a live dispute
for this Court to determine whether and what to certify to the
Supreme Court of Puerto Rico. In the Lex Claims Action, GO
bondholders aggressively moved to take COFINA's property and its
bondholders' collateral, seeking a court ruling that would declare
that money to be resources available to the Commonwealth as a
constitutional matter and
requiring the Commonwealth to take it. But following the Title III
filings, GO bondholders, perhaps in recognition of their lack of
standing in light of the Commonwealth's Title III filing, have not
sought to advance that litigation. And while the Commonwealth
plainly has designs on the money—treating it as its own in the
fiscal plan certified by the Financial Oversight and Management
Board for Puerto Rico (the "Oversight Board") on March 13, 2017
(the "Fiscal Plan")—the Oversight Board has represented that the
Commonwealth will give 30 days' notice before moving to divert
those funds from COFINA. The Dedicated Sales Taxes are the
property of COFINA until a court of competent jurisdiction declares
otherwise. And no litigant, whether the Commonwealth or the GO
bondholders, is currently seeking such a declaration. There is
accordingly no basis to lift the stay and press forward with
certification at this time."
"Second, the GO plaintiffs in the Lex Claims Action no longer have
standing to assert a claim directed at increasing the assets of the
Commonwealth estate. As a result of the Commonwealth's Title III
filing, that claim is now property of the Debtor, which cannot be
asserted by individual GO bondholders. Yet Movants' proposal would
have those same GO bondholders litigate the "available resources"
question directly to the Supreme Court of Puerto Rico,
notwithstanding the fact that neither those plaintiffs nor the
Commonwealth itself has sought to pursue such litigation at this
time. To the extent the "available resources" question needs to be
litigated -- and it is not clear that it must be -- the GO
plaintiffs in Lex Claims would be improper litigants.
"Third, even if the GO plaintiffs had standing, Movants' proposal
would seek to revive the Lex Claims Action, skip over the
dispositive questions, many of which have already been presented
and briefed, and go straight to the constitutional question. Such
an approach violates principles of constitutional avoidance and
would prejudice COFINA and its creditors, including by denying them
the right to have their motions to dismiss or for judgment on the
pleadings heard. Indeed, Movants' proposal purports to restrict
the parties' ability to litigate the merits of the claims advanced
in the Lex Claims Action, essentially forcing the parties to
litigate the "available resources" question while preventing them
from seeking dismissal altogether. Movants' proposal would
unfairly restrict Ambac and others from pursuing the litigation
strategy of their choosing, in violation of their due process
rights under the U.S. Constitution."
Moot by End of July
The Ad Hoc Group of General Obligation Bondholders (the "GO Group")
says the question of whether the SUT are property of the
Commonwealth or COFINA will have to be resolved, either
conclusively in litigation or as part of a negotiated settlement.
But the GO Group claims that the procedure the Movants have
proposed for seeking resolution of a portion of this dispute should
be rejected, the Movants' proposal would utterly divorce the legal
questions on which they seek certification from the concrete claims
and requests for relief at issue in the Lex Claims Action.
According to the GO Group, the federal courts lack jurisdiction to
serve as forums for such abstract legal debates.
Moreover, the GO Group asserts that the relevant claim that was the
subject of the Certification Motions in the Lex Claims Action will
be mooted by the end of July, making resolution of any certified
questions by the Puerto Rico Supreme Court a practical
impossibility.
"Even if Article III did not foreclose Movants' proposal today, the
claim at issue in the Lex Claims Action would be moot well before
the Puerto Rico Supreme Court could rule on the constitutional
validity of the COFINA structure. Although the Lex Claims
Plaintiff's Second Cause of Action implicated the validity of the
COFINA structure, it was pled as a preemption challenge to
Executive Order 2016-30, pursuant to which the Commonwealth
defaulted on its Constitutional Debt. The Commonwealth's statutory
authority for implementing Executive Order 2016-30 rests on the
Puerto Rico Financial Emergency and Fiscal Responsibility Act, Act.
No. 5-2017. That Act purports to authorize the Governor to
promulgate executive orders providing priority rules for the
Commonwealth's spending during an "Emergency Period," id. Sec.
203(c), but provides that the Emergency Period shall expire, at the
latest, on August 1, 2017. At that point, the Lex Claims
Plaintiffs' PROMESA-based challenge to Executive Order 2016-30 will
become moot, because Executive Order 2016-30 will no longer have
any basis in any Puerto Rico statute," says Andrew N. Rosenberg,
Esq., at Paul, Weiss, Rifkind, Wharton & Garrison LLP, counsel of
the GO Group.
Counsel to the Puerto Rico Funds:
Jose C. Sanchez-Castro
Alicia I. Lavergne-Ramirez
Maraliz Vazquez-Marrero
LOPEZ SANCHEZ & PIRILLO LLC
270 Munoz Rivera Avenue, Suite 1110
San Juan, PR 00918
Tel: (787) 522-6776
Fax: (787) 522-6777
E-mail: janchez@lsplawpr.com
alavergne@lsplawpr.com
mvazquez@lsplawpr.com
- and -
Glenn M. Kurtz, Esq.
John K. Cunningham, Esq.
WHITE & CASE LLP
1221 Avenue of the Americas
New York, NY 10036
Tel: (212) 819-8200
Fax: (212) 354-8113
E-mail: gkurtz@whitecase.com
jcunningham@whitecase.com
Jason N. Zakia
WHITE & CASE LLP
200 S. Biscayne Blvd., Suite 4900
Miami, FL 33131
Tel: (305) 371-2700
Fax: (305) 358-5744
E-mail: jzakia@whitecase.com
Counsel to the Mutual Fund Group:
TORO, COLON, MULLET, RIVERA & SIFRE, P.S.C.
Manuel Fernandez-Bared
Linette Figueroa-Torres
Jane Patricia Van Kirk
P.O. Box 195383
San Juan, PR 00919-5383
Tel: (787) 751-8999
Fax: (787) 763-7760
E-mail: mfb@tcmrslaw.com
lft@tcmrslaw.com
jvankirk@tcmrslaw.com
- and -
KRAMER LEVIN NAFTALIS & FRANKEL LLP
Thomas Moers Mayer
Amy Caton
Philip Bentley
David E. Blabey Jr.
Douglas Buckley
1177 Avenue of the Americas
New York, New York 10036
Tel: (212) 715-9100
Fax: (212) 715-8000
E-mail: tmayer@kramerlevin.com
acaton@kramerlevin.com
pbentley@kramerlevin.com
dblabey@kramerlevin.com
dbuckley@kramerlevin.com
Attorneys for Ambac Assurance Corporation:
FERRAIUOLI LLC
Roberto Camara-Fuertes
Sonia Colon
221 Ponce de Leon Avenue, 5th Floor
San Juan, PR 00917
Telephone: (787) 766-7000
Facsimile: (787) 766-7001
E-mail: rcamara@ferraiuoli.com
scolon@ferraiuoli.com
- and -
MILBANK, TWEED, HADLEY & MCCLOY LLP
Dennis F. Dunne
Andrew M. Leblanc
Atara Miller
Grant R. Mainland
28 Liberty Street
New York, NY 10005
Telephone: (212) 530-5000
Facsimile: (212) 530-5219
E-mail: ddunne@milbank.com
aleblanc@milbank.com
amiller@milbank.com
gmainland@milbank.com
Counsel to the Ad Hoc Group of General Obligation Bondholders:
J. Ramon Rivera Morales
JIMENEZ, GRAFFAM & LAUSELL
P.O. Box 366104
San Juan, PR 00936
Telephone: (787) 767-1030
Facsimile: (787) 751-4068
E-mail: rrivera@jgl.com
- and -
Lawrence S. Robbins
Mark T. Stancil
Gary A. Orseck
Kathy S. Zecca
Ariel N. Lavinbuk
Donald Burke
ROBBINS, RUSSELL, ENGLERT, ORSECK,
UNTEREINER & SAUBER LLP
1801 K Street, N.W., Suite 411-L
Washington, DC 20006
Telephone: (202) 775-4500
Facsimile: (202) 775-4510
E-mail: mstancil@robbinsrussell.com
- and -
Andrew N. Rosenberg
Richard A. Rosen
Walter Rieman
Kyle J. Kimpler
Karen R. Zeituni
PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP
1285 Avenue of the Americas
New York, NY 10019
Telephone: (212) 373-3000
Facsimile: (212) 757-3990
E-mail: arosenberg@paulweiss.com
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
management of other pretrial proceedings.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq.,
at O'Neill & Borges are onboard as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at:
https://cases.primeclerk.com/puertorico
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of Funds,
which collectively hold over $3.5 billion in COFINA Bonds and over
$2.9 billion in other bonds issued by Puerto Rico and other
instrumentalities, including over $1.8 billion of Puerto Rico
general obligation bonds ("GO Bonds").
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual Advisers LLC,
Monarch Alternative Capital LP, Senator Investment Group LP, and
Stone Lion Capital Partners L.P.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management
II LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.
The Retiree Committee tapped Jenner & Block LLP and Bennazar,
Garcia & Milian, C.S.P., as its attorneys.
PUERTO RICO: Judge Dein May Handle Discovery, Pretrial Matters
--------------------------------------------------------------
The Honorable Judith Dein, a United States Magistrate Judge for the
District of Massachusetts, has been designated to the United States
District Court for the District of Puerto Rico to preside over
matters referred to her by Judge Laura Taylor Swain in the Title
III cases of the Commonwealth and its instrumentalities pursuant to
section 636 of Title 28 of the United States Code, which defines
the powers and duties of United States Magistrate Judges. The
matters that may be referred to Judge Dein include discovery
disputes, management of other pretrial proceedings, and making
proposed findings and recommendations concerning motions.
Judge Dein will have authority and responsibilities in these cases
only to the extent specified in written Orders of Reference entered
by Judge Swain. Judge Dein will issue orders regarding hearings and
procedures in the matters that are referred to her, entering them
on the relevant case or adversary proceeding dockets.
Judith Gail Dein was appointed Magistrate Judge of the United
States District Court for the District of Massachusetts on July 31,
2000 and served as Chief Magistrate Judge from February 2009 until
February 2012. She graduated from Union College, summa cum laude
in 1976, and Boston College Law School, cum laude, in 1979. She
joined the litigation department of Hale and Dorr, LLP, first as an
associate and then as a junior partner (1981-1989), and then became
a partner at Warner & Stackpole, LLP, which later merged with
Kirkpatrick & Lockhart, LLP. She remained at the firm until her
appointment to the bench. While in private practice, her work
focused on civil litigation with an emphasis on commercial
litigation and employment law.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
management of other pretrial proceedings.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq.,
at O'Neill & Borges are onboard as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at:
https://cases.primeclerk.com/puertorico
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of Funds,
which collectively hold over $3.5 billion in COFINA Bonds and over
$2.9 billion in other bonds issued by Puerto Rico and other
instrumentalities, including over $1.8 billion of Puerto Rico
general obligation bonds ("GO Bonds").
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual Advisers LLC,
Monarch Alternative Capital LP, Senator Investment Group LP, and
Stone Lion Capital Partners L.P.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management
II LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.
The Retiree Committee tapped Jenner & Block LLP and Bennazar,
Garcia & Milian, C.S.P., as its attorneys.
PUERTO RICO: Judge Houser, 4 Others Named to Mediation Team
-----------------------------------------------------------
U.S. District Judge Laura Taylor Swain has entered an order
appointing members of a mediation team for the Title III cases and
related proceedings of the Commonwealth of Puerto Rico and its
instrumentalities.
Each of the members of this team has been designated through the
intercircuit assignment procedures of the Judicial Conference of
the United States to serve as a judicial mediator as needed in the
Title III cases and proceedings through Dec. 22, 2017, with
potential for renewal as needed:
1. The Honorable Barbara Houser, Mediation Team Leader
Chief Bankruptcy Judge
U.S. Bankruptcy Court for the Northern District of Texas
2. The Honorable Thomas Ambro
United States Circuit Judge
U.S. Court of Appeals for the Third Circuit
3. The Honorable Nancy Atlas
Senior United States District Judge
U.S. District Court for the Southern District of Texas
4. The Honorable Victor Marrero
Senior United States District Judge
U.S. District Court for the Southern District of New York
5. The Honorable Christopher Klein
United States Bankruptcy Judge
U.S. Bankruptcy Court for the Eastern District of California
No objections have been received to the appointment of any of the
proposed members of the Mediation Team for these Title III cases
and related proceedings, as announced in the Court's June 14, 2017,
order and notice of the preliminary designation of the Mediation
Team. A concern was raised concerning the availability of
appropriate substantive expertise to the Mediation Team through the
appointment of advisors or otherwise; necessary resources will be
made available to the Mediation Team.
The Mediation Team was appointed to further the goal of the
successful, consensual resolution of the issues raised in these
debt adjustment proceedings. The Team will facilitate confidential
settlement negotiations of any and all issues and proceedings
arising in the Title III cases and proceedings.
Judge Houser will explain the mediation process in further detail
at the Omnibus Hearing on June 28, 2017, in San Juan, Puerto Rico.
Thereafter, the Mediation Team will identify the issues to be
addressed and the sequence in which those issues will be addressed
after consulting with all interested parties and after considering
confidential mediation statements that will be requested from the
parties. Mediation sessions will be held as necessary, and both
the participants and the mediators will be bound by
confidentiality. Participation in mediation sessions will be
voluntary, although all interested parties will be required to
engage in good faith in preliminary discussions with members of the
Mediation Team and in the submission of confidential mediation
statements. This will allow the Mediation Team to develop a list
of issues to be addressed in mediation and the sequence in which
those issues will be addressed after assessing the relative
priority of the issues to a resolution of the cases. The members
of the Mediation Team may issue orders as necessary to facilitate
their work with parties in interest in accordance with these
principles.
To insure the integrity of both the adjudicative process and the
mediation process, the undersigned, as the judge presiding over the
Title III cases and proceedings, will not participate in the
mediation process and the mediators will not provide any
information about the positions taken by parties, or the substance
of the mediation process, to the undersigned. The mediation
process will remain confidential and separate from, and will
proceed concurrently with, the adjudication of issues and
proceedings in the Title III cases and proceedings.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
management of other pretrial proceedings.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq.,
at O'Neill & Borges are onboard as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at:
https://cases.primeclerk.com/puertorico
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of Funds,
which collectively hold over $3.5 billion in COFINA Bonds and over
$2.9 billion in other bonds issued by Puerto Rico and other
instrumentalities, including over $1.8 billion of Puerto Rico
general obligation bonds ("GO Bonds").
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual Advisers LLC,
Monarch Alternative Capital LP, Senator Investment Group LP, and
Stone Lion Capital Partners L.P.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management
II LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.
The Retiree Committee tapped Jenner & Block LLP and Bennazar,
Garcia & Milian, C.S.P., as its attorneys.
PUERTO RICO: June 28 Hearing on Procedures to Address SUT Dispute
-----------------------------------------------------------------
The Financial Oversight and Management Board for Puerto Rico, as
representatives of the Commonwealth of Puerto Rico and the Puerto
Rico Sales Tax Financing Corporation ("COFINA"), at a hearing June
28, 2017, will seek approval of its proposed procedures for
settling the issue of whether and how much sales and use taxes used
to secure bonds issued by COFINA are property of the Commonwealth
or COFINA.
In response to its fiscal crisis, the Commonwealth in 2007 created
COFINA as a financing vehicle to issue bonds secured by the
proceeds of a newly created Puerto Rico sales and use tax (the
"SUT"). The Commonwealth transferred legal ownership of a portion
of certain sales and use taxes to COFINA, protecting the SUT
revenues from "clawback" by the Commonwealth. As of July 31, 2016,
there is approximately $17.3 billion of COFINA Bonds outstanding
($7.6 billion of Senior Bonds and $9.7 billion of Subordinate
Bonds). Approximately $2.6 billion of COFINA bonds are insured.
COFINA's debt service requirement is approximately $725 million for
the fiscal year ending June 30, 2017 and is projected to grow
annually.
For purposes of the Title III Cases, the dominant issue is whether,
after considering all procedural and substantive defenses, the
Pledged Sales Taxes are either (a) property of the Commonwealth
within the meaning of PROMESA section 301(c)(5), or (b) subject to
an allowable claim of the Commonwealth having priority over all
claims of COFINA (the "Commonwealth-COFINA Dispute"). If they are,
then there may be no funds available to pay COFINA debt. If they
are not, then there will be $725 million less available per year to
pay Commonwealth liabilities and expenses, which annual amount
increases over time.
The Commonwealth has issued approximately $17.8 billion in general
obligation bond debt (the "GO Debt"). The GO Debt falls into two
categories: (i) the Commonwealth's general obligation bonds ("GO
Bonds"), which were issued by the Commonwealth, and are backed by a
pledge of the Commonwealth's good faith, credit, and taxing power;
and (ii) bonds issued by certain of the Commonwealth's public
corporations, which are guaranteed by the same pledge of the
Commonwealth's good faith, credit, and taxing power ("GO-Guaranteed
Bonds"). Holders of the GO Debt argue, among other things, that
the Puerto Rico Constitution requires the Commonwealth to pay the
GO Debt ahead of any other expenditure. They point to Article VI,
Section 8 of the Puerto Rico Constitution which provides that, if
Puerto Rico's "available resources" are insufficient to meet all
its appropriations, "interest on the public debt and amortization
thereof shall first be paid, and other disbursements shall
thereafter be made in accordance with the order of priorities
established by law."
Holders and insurers of COFINA Bonds argue that the sales and use
taxes were legislatively rendered property of COFINA from their
inception, thereby eliminating any possibility the taxes may be
property or available resources of the Commonwealth.
Time Is of Essence
"Of the approximately $74 billion in aggregate debt owed by the
Commonwealth, the GO Debt and COFINA Bonds together account for
approximately 55% of the total bond debt to be restructured. The
outcome of the Commonwealth-COFINA Dispute will likely be
dispositive as to the relative recoveries of the debt holders of
COFINA and the Commonwealth. The debt service on the COFINA Bonds
alone is estimated to be $725 million in fiscal year 2017, and is
projected to grow each fiscal year. On the other hand, the Fiscal
Plan contemplates an average of $787 million in available funds for
debt service. Should the COFINA structure be determined to be
valid, almost the entirety of the funds available for debt service
may need to continue to flow to those creditors, leaving very
little recovery to creditors of the Commonwealth," says Martin J.
Bienenstock, Esq., at Proskauer Rose LLP, counsel to the Oversight
Board.
"Time is of the essence to resolve the Commonwealth-COFINA Dispute
because, if the Commonwealth is not entitled to any of the Pledged
Sales Taxes,6 it will, absent borrowing or further slashing
expenses to a counterproductive extent, face acute cash management
issues shortly after November 1, 2017. If there is no settlement
or final adjudication as to the Commonwealth-COFINA Dispute by
November 1, 2017, the Commonwealth will likely need to borrow funds
from COFINA to fund the Commonwealth's operating budget."
"Further, until a resolution is reached on this gating issue, it is
far less feasible for the Oversight Board to negotiate a consensual
title III plan of adjustment for the Commonwealth and COFINA or any
of their other Debtor-affiliates."
Proposed Procedures
As representative of each Debtor, the Oversight Board proposes
these procedures to resolve the Commonwealth-COFINA Dispute:
a. The Oversight Board, as representative of title III debtor
Commonwealth of Puerto Rico pursuant to PROMESA section 315(b),
shall appoint an independent agent to serve as the Commonwealth
representative to litigate and/or settle the Commonwealth-COFINA
Dispute on behalf of the Commonwealth (the "Commonwealth Agent").
b. The Oversight Board will select the Commonwealth Agent from
among the general statutory creditors' committee appointed in the
Commonwealth's title III case and at least two nominations made by
the creditors of the Commonwealth listed as follows:
1. Ad Hoc Group of GO Bondholders
2. Assured Guaranty
3. Financial Guaranty Insurance Co.
4. Syncora
5. UCC
c. The Oversight Board, as representative of title III debtor
COFINA pursuant to PROMESA section 315(b), shall appoint an
independent agent to serve as the COFINA representative to litigate
and/or settle the Commonwealth-COFINA Dispute on behalf of COFINA
(the "COFINA Agent").
d. The Oversight Board shall select the COFINA Agent from among
the statutory creditors' committee that may be appointed in
COFINA's title III case and at least two nominations made by the
creditors and other interested stakeholders of COFINA listed as
follows:
1. UBS Family of Funds/Puerto Rico Family of Funds
2. Mutual Fund Group
3. COFINA Senior Bondholders
4. Ambac Assurance Corp.
5. National Public Finance Guarantee Corp
e. If the creditors fail to agree on two nominations, Oversight
Board members Arthur J. Gonzalez and David A. Skeel shall select
the Agent(s) after consulting with creditors and considering
potential persons that had and had not been nominated.
f. Each Agent shall be entitled to retain legal and other
professionals it reasonably deems appropriate. Each Agent and each
of its retained advisors shall be compensated by the Debtor on
whose behalf they are acting, in conformity with PROMESA Section
316 and any interim compensation procedures ordered by the Court.
g. The Agents shall cooperate to commence the litigation to
resolve the Commonwealth-COFINA Dispute by no later than 10 days
after the Agents are appointed. In advance of the commencement of
such litigation, the Agents, the Oversight Board, and AAFAF shall
agree to a schedule constructed to enable the Court to rule, on a
final basis, on the Commonwealth-COFINA Dispute, on or before Nov.
1, 2017, in the absence of a prior settlement. The order will not
impair or release any rights of the government or the Oversight
Board under PROMESA or otherwise, including PROMESA section 305.
h. Each Agent will endeavor to the best of the Agent's ability
under the circumstances to litigate and negotiate from the
perspective of what result is best for the Debtor the Agent
represents based on the Agent's estimation of the probabilities of
the potential outcomes, as opposed to what result is best for any
particular type of creditor of the Debtor the Agent represents,
consistent with the approach explained by Chancellor Allen of the
Delaware Chancery Court in Credit Lyonnais Bank Nederland, N.V. v.
Pathe Communications Corp., 1991 Del. Ch. LEXIS 215*108 n. 55 (Del.
Ch. 1991), and espoused in Protective Committee for Independent
Shareholders of TMT Trailer Ferry, Inc. v. Anderson, 390 U.S. 414,
424-425 (1968).
i. To the extent it is necessary or desirable to link a
settlement to the treatment of creditors' claims in a title III
plan of adjustment, the Oversight Board may participate in the
negotiations in an effort to reach such a settlement.
j. Any settlement negotiated by the Agents shall only be
effective upon (i) consent of the Oversight Board, (ii) an order of
the Court granting an Oversight Board motion requesting approval of
such settlement, or (iii) confirmation of a title III plan of
adjustment incorporating such settlement.
k. Notwithstanding the appointment of Agents, the Oversight
Board shall remain the only party authorized by PROMESA to propose
a title III plan of adjustment, and to carry out that power and
duty, the Oversight Board may, at any time, propose a title III
plan of adjustment for the Commonwealth and/or COFINA that
incorporates a settlement of the Commonwealth-COFINA Dispute
developed by the Agents, or developed by the Oversight Board, and
the Oversight Board may negotiate with creditors to achieve such
settlement of the Commonwealth-COFINA Dispute.
Objections Filed
Goldman Sachs Asset Management, L.P, a registered investment
advisor that manages funds and accounts owning relevant financial
instruments issued by the Commonwealth itself or its
instrumentalities, submits that the Debtors' motion should be
rejected.
"The Oversight Board has proposed a very novel approach to resolve
that dispute. GSAM believes that resolution of this dispute should
proceed via a more traditional route: a parallel path of
negotiations open to interested parties and, to the extent
necessary, narrowly focused litigation on specific issues,
similarly open to interested parties. GSAM believes such a
procedure is most likely to result in a resolution that is fair to
all interested parties," William P. Smith, Esq., at McDermott Will
& Emery LLP, counsel to GSAM says.
The Mutual Fund Group also objects, saying that the proposed
procedures violate the U.S. Constitution.
"The Court should deny the Protocol Motion. The Oversight Board
seeks -- without any legal authority -- to wrest control over the
Commonwealth-COFINA Dispute through entry of an order (the
"Proposed Order") that would exceed the bounds of PROMESA and
violate the United States Constitution. The Proposed Order would
appoint an agent to enforce COFINA's right to pledged revenues in
which COFINA itself has only minimal equity -- the agent would act
as a receiver. There is no authority for such appointment. The
Proposed Order provides for a collusive litigation between the
Oversight Board's own agents, on the Oversight Board's own
schedule, with the Oversight Board retaining the power to settle,
in violation of Article III of the United States Constitution,"
says Thomas Moers Mayer, Esq., at Kramer Levin Naftalis & Frankel
LLP, counsel to the Mutual Fund Group.
Independent COFINA Agent
National Public Finance Guarantee Corporation, which insures more
than $690 million of general obligation bonds issued by the
Commonwealth and more than $1.1 billion in senior sales tax revenue
bonds issued by COFINA, says the Motion should be denied and said
that an independent COFINA agent should be selected by COFINA
creditors, not by the Oversight Board.
"By filing the Motion, the Oversight Board has finally conceded the
point that National and other creditors have been making for
months: the Oversight Board and its counsel have an irreconcilable
conflict and cannot fairly represent the interests of the Puerto
Rico Sales Tax Financing Corporation ("COFINA"). But after
acknowledging the conflict, the Oversight Board's proposal fails to
cure it. It asks the Court to vest the Oversight Board—the
conflicted party -- with both the ability to appoint an
"independent Oversight Board agent" to serve as COFINA's
representative and veto power over any settlement negotiated by
that agent. Accepting this proposal would bless the conflict
instead of resolving it. Simply put, given its now admitted
conflict, the Oversight Board cannot continue to pull COFINA's
strings," National said.
The COFINA Senior Bondholders' Coalition says that while the GO
Bondholders' claims lack merit for a variety of reasons, it does
not dispute that the Commonwealth-COFINA Dispute is a gating issue
in the Title III Cases. Moreover, in recognition of the key role
that the Oversight Board plays in the Title III Cases, the COFINA
Senior Bondholders' Coalition is prepared to participate in the
process that the Oversight Board has proposed, subject to
modification of certain key aspects of the Proposed Procedures that
it believes raise significant concerns.
The COFINA Senior Bondholders' Coalition includes Jose F. Rodriguez
Perello and the following institutional holders of the COFINA
senior bonds: Aristeia Horizons, L.P.; Camino Cipres LLC; Camino
Roble LLC; Canary SC Master Fund, L.P.; Canyon Capital Advisors LLC
(on behalf of its participating clients); River Canyon Fund
Management LLC (on behalf of its participating clients); Crescent
1, L.P.; CRS Master Fund, L.P.; Cyrus Opportunities Master Fund II,
Ltd.; Cyrus Select Opportunities Master Fund, Ltd.; Cyrus Special
Strategies Master Fund, L.P.; Decagon Holdings 1, L.L.C.; Decagon
Holdings 2, L.L.C.; Decagon Holdings 3, L.L.C.; Decagon Holdings 4,
L.L.C.; Decagon
Holdings 5, L.L.C.; Decagon Holdings 6, L.L.C.; Decagon Holdings 7,
L.L.C.; Decagon Holdings 8, L.L.C.; Decagon Holdings 9, L.L.C.;
Decagon Holdings 10, L.L.C.; Merced Partners Limited Partnership;
Merced Partners IV, L.P.; Merced Partners V, L.P.; Pandora Select
Partners, L.P.; SB Special Situation Master Fund SPC, Segregated
Portfolio D; Scoggin International Fund Ltd.; Scoggin Worldwide
Fund Ltd.; Taconic Master Fund 1.5 L.P.; Taconic Opportunity Master
Fund L.P.; Tilden Park Investment Master Fund LP; Varde Credit
Partners Master, L.P.; Värde Investment Partners, L.P.; Värde
Investment Partners (Offshore) Master, L.P.; The Värde Skyway
Master Fund, L.P; Whitebox Asymmetric Partners, L.P.; Whitebox
Institutional Partners, L.P.; Whitebox Multi-Strategy Partners,
L.P.; and Whitebox Term Credit Fund I L.P.
Ambac Assurance Corporation ("Ambac"), a holder and/or insurer of
approximately $2.7 billion of bonds issued by the Commonwealth,
COFINA, and other Commonwealth instrumentalities, says it supports
an expeditious resolution of the GO-COFINA Dispute, but not on the
unnecessarily rushed time frame proposed by the Oversight Board.
"The Commonwealth's articulated need for cash come November does
not, as the Oversight Board suggests, require immediate invasion of
COFINA's property. Other financing alternatives, which the
Oversight Board has not pursued, may obviate the need to quickly
resolve a weighty legal issue. The Oversight Board is plainly not
representing COFINA's interests, Ambac's counsel, Dennis F. Dunne,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, counsel to AMBAC
explains.
Revisions to Procedures
The COFINA Senior Bondholders' Coalition, Ambac Assurance Corp.,
and National (collectively, the "COFINA Senior Representatives")
say they have been working diligently to coordinate a joint
response to the Motion and, while unable to reach complete
agreement on every issue, particularly given the short time frame
in which to object, the COFINA Senior Representatives have
identified several areas upon which they unanimously agree.
The COFINA Senior Representatives submit that any order approving
the Motion (the "Procedures Order") should include the following:
* The COFINA Senior Representatives Must Unanimously Agree on
the Selection of A COFINA Agent. The COFINA Agent must be an
individual upon whom the COFINA Senior Representatives unanimously
agree. The COFINA Senior Representatives will submit the nominee
to serve as the COFINA Agent within 10 days of entry of the
Procedures Order, who shall be appointed as the COFINA Agent.
* Court Approval of Any Settlement of the Commonwealth-COFINA
Dispute Shall Be Required. Any settlement reached pursuant to the
Procedures Order shall not be effective unless and until the Court
has entered an order approving such settlement.
* COFINA Senior Representatives Shall Be Granted Intervention in
Any Litigation Commenced Pursuant to the Procedures Order. The
COFINA Senior Bondholders' Coalition, Ambac, and National shall be
authorized to intervene in any litigation commenced pursuant to the
Procedures Order without any further order of the Court.
* The COFINA Agent Shall Owe Fiduciary Duties to COFINA. The
COFINA Agent shall owe fiduciary duties to COFINA, and not to any
individual creditor or creditor group. For the avoidance of doubt,
no Agent shall have the authority to litigate or settle any matter
other than the Commonwealth-COFINA Dispute.
* Pre-Petition Mediation Shall Resume. The mediation that began
prior to the commencement of the Title III Cases among the COFINA
senior bondholders, COFINA subordinate bondholders, monolines, GO
Bondholders, and the Oversight Board, among others, shall resume
promptly. The mediator shall be selected from among the members of
the Court-appointed mediation team.
Counsel for the COFINA Senior Bondholders' Coalition:
QUINN EMANUEL URQUHART & SULLIVAN, LLP
51 Madison Avenue, 22nd Floor
New York, New York 10010-1603
Susheel Kirpalani
Eric Winston
Daniel Salinas
Eric Kay
Kate Scherling
Brant Duncan Kuehn
E-mail: susheelkirpalani@quinnemanuel.com
ericwinston@quinnemanuel.com
danielsalinas@quinnemanuel.com
erickay@quinnemanuel.com
katescherling@quinnemanuel.com
brantkuehn@quinnemanuel.com
Attorneys for National Public Finance Guarantee Corporation:
Eric Perez-Ochoa
Alexandra Casellas-Cabrera
Lourdes Arroyo Portela
Adsuar Muniz Goyco Seda & Perez-Ochoa, P.S.C.
208 Ponce de León Avenue, Suite 1600
San Juan, Puerto Rico 00936
Telephone: 787. 756.9000
Facsimile: 787. 756.9010
E-mail: epo@amgprlaw.com
acasellas@amgprlaw.com
larroyo@amgprlaw.com
– and –
Marcia Goldstein
Jonathan Polkes
Salvatore A. Romanello
Gregory Silbert
Kelly DiBlasi
Gabriel A. Morgan
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
E-mail: marcia.goldstein@weil.com
jonathan.polkes@weil.com
salvatore.romanello@weil.com
gregory.silbert@weil.com
kelly.diblasi@weil.com
gabriel.morgan@weil.com
Counsel to GSAM:
William P. Smith, Esq.
James W. Kapp, III, Esq.
Megan Thibert-Ind, Esq.
Kaitlin P. Sheehan, Esq.
McDERMOTT WILL & EMERY LLP
444 West Lake Street, Suite 4000
Chicago, Illinois 60606
Tel: (312) 372-2000
Fax: (312) 984-7700
E-mail: wsmith@mwe.com
jkapp@mwe.com
mthibert-ind@mwe.com
ksheehan@mwe.com
- and -
Ramon Dapena, Esq.,
Victor Quinones
Ivan Llado, Esq.,
MORELL BAUZA CARTAGENA & DAPENA, LLC
Plaza 273, Suite 700
273 Ponce de Leon Ave.
Hato Rey, Puerto Rico 00917-1934
Tel: (787) 723-1233
Fax: (787) 723-8763
E-mail: ramon.dapena@mbcdlaw.com
victor.quinones@mbcdlaw.com
ivan.llado@mbcdlaw.com
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
management of other pretrial proceedings.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq.,
at O'Neill & Borges are onboard as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at:
https://cases.primeclerk.com/puertorico
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of Funds,
which collectively hold over $3.5 billion in COFINA Bonds and over
$2.9 billion in other bonds issued by Puerto Rico and other
instrumentalities, including over $1.8 billion of Puerto Rico
general obligation bonds ("GO Bonds").
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual Advisers LLC,
Monarch Alternative Capital LP, Senator Investment Group LP, and
Stone Lion Capital Partners L.P.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management
II LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.
The Retiree Committee tapped Jenner & Block LLP and Bennazar,
Garcia & Milian, C.S.P., as its attorneys.
PUERTO RICO: Retirees Tap Jenner & Block, Bennazar as Attorneys
---------------------------------------------------------------
The Official Committee of Retired Employees of the Commonwealth of
Puerto Rico formed in the PROMESA Title III cases has tapped Jenner
& Block LLP and Bennazar, Garcia & Milian, C.S.P., as its
attorneys.
The Official Retiree Committee was appointed by the United States
Trustee on June 15, 2017. The Retiree Committee represents the
160,000 retirees of Puerto Rico that would be affected by the cuts
proposed in Puerto Rico's fiscal plan. Puerto Rico owes $49
billion in pension liabilities to its retirees and all three
principal retirement systems for public employees in Puerto Rico
are severely underfunded.
Bennazar previously filed a notice of appearance in the Title III
cases on behalf of an organization called Movimiento Pro
Pensionados de Puerto Rico, which had constituted itself as an "Ad
Hoc Retiree Committee" of retired employees of different agencies
of the Commonwealth. Bennazar has filed a notice of withdrawal of
appearance in light of the appointment of the Official Retiree
Committee.
Robert D. Gordon, then with the firm of Clark Hill, also
represented the former Ad Hoc Committee. Mr. Gordon ceased his
legal representation of the former Ad Hoc Committee and now, as a
member of the firm of Jenner & Block, together with other members
of that firm, has been retained by the Official Committee of
Retirees as its proposed counsel.
The Retiree Committee's attorneys can be reached at:
JENNER & BLOCK LLP
Robert Gordon, Esq.
Richard Levin, Esq.
919 Third Ave
New York, NY 10022-3908
Tel: 212-891-1600
Fax: 212-891-1699
E-mail: rgordon@jenner.com
rlevin@jenner.com
JENNER & BLOCK LLP
Catherine Steege, Esq.
Melissa Root, Esq.
353 N. Clark Street
Chicago, IL 60654
E-mail: csteege@jenner.com
mroot@jenner.com
Tel: 312-222-9350
Fax: 312-239-5199
- and -
BENNAZAR, GARCIA & MILIAN, C.S.P.
A.J. Bennazar-Zequeira, Esq.
Edificio Union Plaza
PH-A piso 18
Avenida Ponce de León #416
Hato Rey, San Juan
Puerto Rico 00918
E-mail: ajb@bennazar.org
Tel: 787-754-9191
Fax: 787-764-3101
Unlike in cases commenced under the Bankruptcy Code, professionals
retained by the Debtors and the Oversight Board do not require
court authorization for retention. However, by virtue of PROMESA's
incorporation of Section 1103 of the Bankruptcy Code, the retention
of any professionals for any official committees will require court
approval. As of June 23, 2017, the Retiree Committee has not
submitted applications to retain Jenner & Block LLP and Bennazar as
its attorneys.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ("PROMESA").
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21.
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
management of other pretrial proceedings.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq.,
at O'Neill & Borges are onboard as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at:
https://cases.primeclerk.com/puertorico
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Toro, Colon, Mullet, Rivera & Sifre, P.S.C. and Kramer Levin
Naftalis & Frankel LLP serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc.,
Franklin Advisers, Inc., and the First Puerto Rico Family of Funds,
which collectively hold over $3.5 billion in COFINA Bonds and over
$2.9 billion in other bonds issued by Puerto Rico and other
instrumentalities, including over $1.8 billion of Puerto Rico
general obligation bonds ("GO Bonds").
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, Franklin Mutual Advisers LLC,
Monarch Alternative Capital LP, Senator Investment Group LP, and
Stone Lion Capital Partners L.P.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management
II LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed a nine-member Official Committee of
Retirees and a seven-member Official Committee of Unsecured
Creditors of the Commonwealth.
The Retiree Committee tapped Jenner & Block LLP and Bennazar,
Garcia & Milian, C.S.P., as its attorneys.
QUANTEX LABORATORIES: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: Quantex Laboratories, Inc
300 Eastpark Blvd, Ste 100
Cranbury, NJ 08512
Business Description: Quantex Laboratories --
http://www.quantexlabs.com-- serves the
Pharmaceutical, personal care products,
medical device, cosmetics and other life
science companies. Founded in 1992, the
Company provides analytical testing,
responsiveness to client needs, flexibility
in its approach, and collaborative
communication from scientist to scientist.
The Company's GMP analytical services
support product manufacturing, formulation
development, release testing, analytical
chemistry, analytical development, drug and
biopharmaceutical development, CMC support,
stability storage, and drug delivery device
testing, as well as regulatory support for
e-liquids.
Chapter 11 Petition Date: June 22, 2017
Case No.: 17-22754
Court: United States Bankruptcy Court
District of New Jersey (Trenton)
Judge: Hon. Michael B. Kaplan
Debtor's Counsel: Paul Gauer, Esq.
347 Franklin Street
Bloomfield, NJ 07003
Tel: (973) 743-7050
Fax: (973) 743-9173
Email: gauerlaw@aol.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by James Menoutis, CEO.
A list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/njb17-22754.pdf
RANGER TRANSPORT: Case Summary & 9 Unsecured Creditors
------------------------------------------------------
Debtor: Ranger Transport, Inc.
P.O. Box 124
Georgetown, GA 39854
Case No.: 17-11221
Business Description: Provides freight transportation services and
hauling cargo
Chapter 11 Petition Date: June 23, 2017
Court: United States Bankruptcy Court
Middle District of Alabama (Dothan)
Judge: Hon. William R. Sawyer
Debtor's Counsel: Cameron A. Metcalf, Esq.
ESPY, METCALF & ESPY, P.C.
P. O. Drawer 6504
Dothan, AL 36302
Tel: 334-793-6288
E-mail: cam@espymetcalf.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robert E. Thompson, Esq.
The Debtor's list of nine unsecured creditors is available for free
at:
http://bankrupt.com/misc/almb17-11221.pdf
RED PHOENIX: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Red Phoenix Investments, LLC
9951 Patton Road SW
Calgary, Alberta T2V 5G1
Business Description: Founded in 2000, Red Phoenix is a California
Limited Liability Company that provides
consulting services to businesses,
developers, and land owners requiring
government relations, regulatory approvals,
debt re-structuring, managed buy-outs and
liquidation assistance.
Chapter 11 Petition Date: June 23, 2017
Case No.: 17-51513
Court: United States Bankruptcy Court
Northern District of California (San Jose)
Judge: Hon. Elaine M. Hammond
Debtor's Counsel: Perry D. Popovich, Esq.
LAW OFFICES OF PERRY POPOVICH
19711 Tollhouse Rd
Clovis, CA 93619
Tel: (650) 856-0672
E-mail: popovchp@pacbell.net
perrypopovich@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Alex Fraser, manager.
The Debtor did not file a list of its 20 largest unsecured
creditors on the Petition Date.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/canb17-51513.pdf
REV GROUP: Moody's Revises Outlook to Positive & Affirms B1 CFR
---------------------------------------------------------------
Moody's Investors Service changed REV Group, Inc. outlook to
positive from stable due to Moody's expectations that the company's
financial policies will be supportive of an improved long-term
financial leverage profile following the repayment of the company's
senior secured notes due November 2019 with IPO proceeds. Moody's
also expects the company's profit improvement initiatives will
yield further growth in EBITDA margins which expanded from 3.2% in
2014 to 6.9% for the last twelve months through April 2017.
Concurrently, Moody's assigned a B1 (LGD-4) rating to the company's
$350 million asset-based revolving credit facility due 2022 and an
SGL-3 speculative grade liquidity ("SGL") rating. REV's B1
corporate family rating (CFR) and B1-PD probability of default
ratings were affirmed.
Moody's has taken the following rating actions:
Ratings assigned:
$350 million senior secured revolving credit facility due April
25, 2022, at B1 (LGD-4)
Speculative Grade Liquidity Rating, at SGL-3
Ratings affirmed:
Corporate Family Rating, at B1
Probability of Default Rating, at B1-PD
Outlook: Changed to Positive from Stable
Moody's does not rate REV's $75 million term loan due April 2022
RATINGS RATIONALE
The change in outlook to positive is based on the expectation that
the company will maintain a prudent capital structure that balances
the growth expectations that often are demanded of a publicly
traded company versus a more conservative financial debt structure
that includes paying down revolver debt soon after acquisitions.
The company has publicly indicated its intent to partially use free
cash flow generated in the second half of its fiscal year to pay
down debt through the end of its fiscal year ended October 31,
2017. The change in outlook is also based on Moody's expectations
that the company will sustain a moderately improving revenue and
EBITDA stream stemming from positive end-market fundamentals,
recent acquisitions and proactive actions the company has been
taking to increase profitability.
The lower level of permanent debt stems from the company's use of
$180 million of its January 2017 IPO proceeds to redeem its 8.5%
senior notes outstanding due 2019. Since then the company has put
in place its existing $350 million ABL, which it has utilized to
fund recent acquisitions as well as a $75 million term loan due
2022 put in place in April of this year.
REV's B1 CFR reflects the company's moderate leverage for the
rating category balanced against the expectation that the company
will have to continue to invest in capital and other costs to
sustain its anticipated growth and backlog. Debt/EBITDA for the
twelve month period ended April 29, 2017 (including Moody's
standard adjustments) totaled 2.1x. The rating also recognizes the
company's leading market positions primarily in its fire &
emergency and type A school bus market segments as well as strong
brand recognition for its various well-known brands within each of
its businesses inclusive of its growing recreational vehicle
segment. The rating is supported by the company's scale, strong
competitive position within its niche markets, product
diversification and adequate liquidity.
In addition, the company has grown both organically and through
acquisitions and is expected to continue to use its free cash flow
towards modestly-sized acquisitions and continued new product
development. Over the longer-term, the ratings reflect the
aforementioned favorable demographic and demand trends in the
company's end-markets. These factors are counterbalanced by
relatively low EBITDA margins for the rating category, an
acquisitive history largely debt-financed, cyclical end-markets and
high degree of seasonality in certain segments.
The positive rating outlook is supported by the expectation that
the company will effectively integrate recent acquisitions and
continue to improve operating margins while maintaining a
conservative financial leverage profile of below 2.5 times with
intermittent spikes to accommodate bolt-on acquisitions.
A ratings upgrade would likely emanate from a meaningful and
sustained improvement in profitability metrics with EBITA margins
increasing beyond 8% while maintaining debt-to-EBITDA towards 2.5x.
In addition, a strengthening in the company's liquidity profile
with FCF-to-debt in the mid-to-high single-digits would also be
considered for an upgrade.
The ratings could be pressured downward if there were a decline in
revenue growth or pressure on current operating margins. In
addition, the ratings could potentially be downgraded if there is
the expectation that end-market fundamentals are weakening due to
recessionary conditions impacting municipal and commercial
spending, or if the company's financial policies become aggressive
through debt-financed acquisitions or shareholder remuneration.
The principal methodology used in these ratings was Global
Manufacturing Companies published in June 2017.
REV is a producer of specialty vehicles that operates in three
segments: Commercial, Fire & Emergency, and Recreation. American
Industrial Partners formed the company in February 2010 by
combining its portfolio companies Collins Industries, E-One,
Fleetwood RV and Halcore Group. Post the company's January 2017
IPO, American Industrial Partners remains a controlling
shareholder, owning approximately 70 percent of the company's
common shares. Revenues for the twelve month period ended April 29,
2017 totaled $2.1 billion.
RLE INDUSTRIES: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Affiliated Debtors that filed separate Chapter 11 bankruptcy
petitions:
Debtor Case No.
------ --------
RLE Industries LLC 17-11748
dba Robert Lighting & Energy
1175 York Avenue, #15 E
New York, NY 10065
NEI Industries Inc. 17-11749
dba Northeast Electric
35 Kulick Road
Fairfield, NJ 07004
Business Description: Founded in 1997, RLE Industries, LLC --
http://rleindustries.com/-- manufactures
commercial lighting fixtures.
Chapter 11 Petition Date: June 23, 2017
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Hon. Michael E. Wiles
Debtors' Counsel: Dawn Kirby, Esq.
DELBELLO DONNELLAN WEINGARTEN
WISE & WIEDERKEHER, LLP
One North Lexington Avenue
White Plains, NY 10601
Tel: (914) 681-0200
Fax: 914-681-0288
E-mail: dkirby@ddw-law.com
- and -
Jonathan S. Pasternak, Esq.
DELBELLO DONNELLAN WEINGARTEN
WISE & WIEDERKEHR, LLP
One North Lexington Avenue
White Plains, NY 10601
Tel: (914) 681-0200
Fax: (914) 684-0288
E-mail: jpasternak@ddw-law.com
Debtors'
Financial
Advisors: FORESIGHT ADVISORS LLC
Estimated Estimated
Assets Liabilities
---------- -----------
RLE Industries LLC $500K-$1M $1M-$10M
NEI Industries Inc. $500K-$1M $1M-$10M
The petitions was signed by Scott Koenig, president.
RLE Industries LLC's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/nysb17-11748.pdf
NEI Industries Inc. list of 20 largest unsecured creditors contains
a single entry: Fairfield Fuels, holding an unsecured claim of
$15,951. A full-text copy of the petition is available at
http://bankrupt.com/misc/nysb17-11749.pdf
RMS TITANIC: Equity Committee Hires Lincoln Partners as Advisors
----------------------------------------------------------------
The Official Committee of Equity Security Holders of Premier
Exhibitions, Inc. and RMS Titanic, Inc. seeks authorization from
the U.S. Bankruptcy Court for the Middle District of Florida to
employ Lincoln Partners Advisors LLC as financial advisor to the
equity committee, nunc pro tunc to April 3, 2017.
The Equity Committee requires Lincoln Advisors to:
(a) review and analyze the Debtors' operations, assets,
financial condition, business plan, strategy, and operating
forecasts;
(b) evaluate the assets and liabilities of the Debtors and
evaluate the Debtors' strategic and financial alternatives;
(c) assist in the determination of an appropriate go-forward
capital structure for the Debtors;
(d) analyze and assist with any proposed financings,
including assistance with obtaining debtor in possession
and exit financing;
(e) assist the Equity committee in developing, evaluating,
structuring and negotiating the terms and conditions of a
restructuring, plan of reorganization, or sale transaction,
including the value of the securities, if any, that may be
issued to the Equity committee under any such
restructuring, plan of reorganization, or sale transaction;
(f) analyze any merger, divestiture, joint-venture, or
investment transaction, including the proposed structure
and form thereof;
(g) analyze any new debt or equity capital and assist with
obtaining new debt or equity capital;
(h) assist in the evaluation and investigation of prepetition
transactions in which the Debtors and their insiders were
involved;
(i) if requested by the legal counsel to the Equity committee,
prepare reports with respect to any and all proposed
financings, the valuation of the Debtors or any specific
assets of the Debtors, or proposed merger, divestiture,
joint-venture, or investment transaction;
(j) provide the Equity committee with other appropriate general
restructuring advice as the Equity committee and its
counsel deems appropriate; and
(k) testify in connection with Lincoln Advisors' provision of
any of the abovementioned services in the Bankruptcy Court
or other court.
As previously reported in the Troubled Company Reporter, the Equity
Committee hired Teneo Securities LLC as financial advisor for the
Committee. On December 8, 2016, the Court approved the employment
of Teneo Securities as financial advisor to the Equity Committee
nunc pro tunc to October 2016.
As of April 3, 2017, Brent C. Williams and Brendan J. Murphy,
formerly Managing Directors at Teneo who provided services under
the Teneo Engagement Letter, became Managing Directors at Lincoln
Advisors.
The Services for the Equity Committee and the Creditors Committee
below the Managing Director level will continue to be provided by
Teneo employees under the Teneo Engagement Letter, specifically by
Jeremy DeKoe. Lincoln Advisors and Teneo agree to coordinate with
each other to provide the services set out in the Lincoln Advisors
Engagement Letter and Teneo Engagement Letter, as applicable.
Lincoln Advisors will be paid on an hourly rate:
Brent C. Williams, Sr. Managing Director $565
Brendan J. Murphy, Managing Director $525
Analyst to Vice President $320-$480
The Equity Committee requests that Lincoln Advisors and Teneo be
entitled to monthly fees at the rate set forth in the Teneo
Engagement Letter and Lincoln Advisors Engagement Letter with a cap
of $25,000 per month as compensation for professional services
rendered to the Equity Committee, as well as reimbursement for
reasonable and documented out-of-pocket expenses.
In addition to the Monthly Fee, if the Debtors announce, consummate
or enter into an agreement with respect to one or more Equity
Distributions during the term of Teneo's and Lincoln Advisors'
engagement, then the Debtors shall pay Teneo and Lincoln Advisors,
immediately upon consummation, a non-refundable cash fee equal to:
-- 1.00% of the first $20 million, plus
-- 1.25% of the amount of between $20 million and $40 million,
plus
-- 1.50% of the amount above $40 million (the "Equity
Distribution Fee").
The Equity Distribution Fee will be paid by the Debtors as follows:
50% to Lincoln Advisors and 50% to Teneo.
Brent C. Williams, senior managing director at Lincoln Advisors,
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 Debtor and its estate.
Lincoln Advisors can be reached at:
Brent C. Williams
LINCOLN PARTNERS ADVISORS LLC
444 Madison Avenue, Suite 300
New York, NY 10022
Tel: (212) 257-7750
E-mail: bwilliams@lincolninternational.com
About About RMS Titanic Inc.
Premier Exhibitions, Inc. (Nasdaq: PRXI), located in Atlanta,
Georgia, is a presenter of museum quality exhibitions throughout
the world. Premier --http://www.PremierExhibitions.com/-- develops
and displays unique exhibitions for education and entertainment
including Titanic: The Artifact Exhibition, BODIES...The
Exhibition, Tutankhamun: The Golden King and the Great Pharaohs,
Pompeii The Exhibition, Extreme Dinosaurs and Real Pirates in
partnership with National Geographic. The success of Premier
Exhibitions lies in its ability to produce, manage, and market
exhibitions.
RMS Titanic and seven of its subsidiaries filed voluntary petitions
for reorganization under Chapter 11 of the Bankruptcy Code (Bankr.
M.D. Fla. Lead Case No. 16-02230) on June 14, 2016. Michael J.
Little, RMS Titanic's Former Chief Financial Officer and Chief
Operating Officer, signed the petitions. The Chapter 11 cases are
assigned to Judge Paul M. Glenn.
The Debtors estimated both assets and liabilities of $10 million to
$50 million.
The Debtors are represented by Daniel F. Blanks, Esq. and Lee D.
Wedekind, III, Esq. at Nelson Mullins Riley & Scarborough LLP. The
Debtors employ Brian A. Wainger, Esq. at Kaleo Legal as special
litigation counsel, outside general counsel, securities counsel,
and conflicts counsel; Robert W. McFarland, Esq. at McGuireWoods
LLP as special litigation counsel; Steven L. Berson, Esq. at
Dentons US LLP and Dentons Canada LLP as outside general counsel
and securities counsel; Oscar N. Pinkas, Esq. at Dentons LLP as
outside general counsel and securities counsel.
The Debtors also employed Ronald L. Glass as Chief Restructuring
Officer and GlassRatner Advisory & Capital Group, LLC, as financial
advisors.
On August 24, 2016, the United States Trustee appointed an official
committee of unsecured creditors, as well as an official committee
of equity security holders. The Creditors Committee consists of TSX
Operating Co., LLC, Dallian Hoffen Biotechnique Co., Ltd., and B.E.
Capital Management Fund, LP. The Equity Committee consists of
Jonathan Heller, Lawndale Capital Management LLC, Ian Jacobs, ACK
Investments, LLC, and Frank Gerber.
The Creditors Committee retained Avery Samet, Esq. and Jeffrey
Chubak, Esq. at Storch Amini & Munves PC, and Richard R. Thames,
Esq. and Robert A. Heekin, Jr., Esq. at Thames Markey & Heekin,
P.A. as counsel.
The Equity Committee retained Peter J. Gurfein, Esq. at Landau
Gottfried & Berger LLP as counsel; Jacob A. Brown, Esq. and
Katherine C. Fackler, Esq. at Akerman LLP as Co-Counsel; and Teneo
Securities LLC as financial advisor.
ROBISON TIRE: Disclosures OK'd; Plan Hearing on Aug. 10
-------------------------------------------------------
The Hon. Katharine M. Samson of the U.S. Bankruptcy Court for the
Southern District of Mississippi has approved Robison Tire Company,
Inc.'s disclosure statement filed on April 24, 2017, referring to
the Debtor's plan of reorganization dated April 24, 2017.
A hearing on confirmation of the Plan will be held on Aug. 10,
2017, at 1:30 p.m.
Objections to the plan confirmation must be filed by July 27,
2017.
Aug. 3, 2017, is the last day for submitting ballots of acceptance
or rejection of the Plan with the attorney for the Debtor.
About Robison Tire
Since the early 1970's, Robison Tire Co., Inc., has been an
authorized wholesaler and retailer of a number of the brands,
including Armour, Bridgestone, Goodyear, Hankook, Hercules and
Toyo.
Robison Tire Co., Inc. sought the Chapter 11 protection (Bankr.
S.D. Miss. Case No. 16-51183) on July 14, 2016. The petition was
signed by Michael Windham, president. Judge Katharine M. Samson
is assigned to the case. The Debtor estimated assets in the range
of $500,000 to $1 million and $1 million to $10 million in debt.
Jarrett Little, Esq. at Lentz & Little, PA serves as the Debtor's
Counsel, while Corlew Munford & Smith, PLLC acts as special
counsel. The Debtor employs Taylor Auction & Realty, Inc. as
auctioneer and appraiser; and Molloy-Seidenburg & Co., P.A. as
accountant.
No official committee of unsecured creditors has been appointed in
the case.
ROOSTER ENERGY: 2-Member Committee Appointed for Cochon Properties
------------------------------------------------------------------
Henry G. Hobbs, Jr., Acting U.S. Trustee for Region 5, on June 22,
2017, appointed two creditors to serve on the official committee of
unsecured creditors in the Chapter 11 case of Cochon Properties,
LLC.
The committee members are:
(1) Chairman:
Jimmie "Beau" Martin
E-mail: beau@bjmartininc.com
Tel: (985) 632-2727
P.O. Box 448
Cut Off, LA 70345
(2) K & K Marine LLC
Oren Dupre
P.O. Box 1502
Amelia, LA 70340
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at a debtor's
expense. They may investigate the debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.
About Rooster Energy
Houston, Texas-based Rooster Energy Ltd. --
http://www.roosterenergyltd.com-- is an integrated oil and natural
gas company with an exploration and production (E&P) business and a
downhole and subsea well intervention and plugging and abandonment
service business. The Company's operations are located in the
state waters of Louisiana and the shallow waters of the Gulf of
Mexico, mature regions that have produced since 1936.
Rooster Energy, L.L.C., Rooster Energy Ltd., and five other
affiliates filed a Chapter 11 petition (Bankr. W.D. La. Lead Case
No. 17-50705) on June 2, 2017. Jan M. Hayden, Esq., Lacey
Rochester, Esq., Susan C. Mathews, Esq., and Daniel J. Ferretti,
Esq., at Baker Donelson Bearman Caldwell & Berkowitz, P.C., serve
as bankruptcy counsel.
In its petition, Rooster Energy L.L.C. estimated $0 to $50,000 in
assets and $50 million to $100 million in liabilities. The
petition was signed by Kenneth F. Tamplain, Jr., president and
chief executive officer.
Counsel for Angelo, Gordon Energy Servicer, LLC, the administrative
agent and collateral agent on behalf of itself and the holders of
secured notes issued pursuant to a Note Purchase Agreement, dated
as of November 17, 2014, Louis M. Phillips, Esq., at Kelly Hart &
Pitre, and Paul E. Heath, Esq., and Bradley R. Foxman, Esq., at
Vinson & Elkins LLP.
Henry Hobbs, Jr., acting U.S. trustee for Region 5, on June 23
appointed three creditors to serve on the official committee of
unsecured creditors in the Chapter 11 case of Rooster Petroleum
LLC, an affiliate of Rooster Energy, LLC.
ROOSTER ENERGY: 3-Member Committee Appointed for Rooster Petroleum
------------------------------------------------------------------
Henry Hobbs, Jr., acting U.S. trustee for Region 5, on June 23
appointed three creditors to serve on the official committee of
unsecured creditors in the Chapter 11 case of Rooster Petroleum
LLC, an affiliate of Rooster Energy, LLC.
The committee members are:
(1) Laredo Construction, Inc.
Tarn Springob
13385 Murphy Road
Stafford, TX 77477
Phone: 281-499-2565
Email: tspringob@laredogroup.org
(2) C & G Boats
Neil Vincent
100 Commission Blvd.
Lafayette, LA 70508
(3) DeepCor Marine
c/o Mark Joachim
Polsinelli
1401 Eye Street, N.W.
Washington, DC 20005
Tarn Springob will serve as chairman of the committee.
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at a debtor's
expense. They may investigate the debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.
About Rooster Energy
Houston, Texas-based Rooster Energy Ltd. --
http://www.roosterenergyltd.com-- is an integrated oil and natural
gas company with an exploration and production (E&P) business and a
downhole and subsea well intervention and plugging and abandonment
service business. The Company's operations are located in the
state waters of Louisiana and the shallow waters of the Gulf of
Mexico, mature regions that have produced since 1936.
Rooster Energy, L.L.C., Rooster Energy Ltd., and five other
affiliates filed a Chapter 11 petition (Bankr. W.D. La. Lead Case
No. 17-50705) on June 2, 2017.
In its petition, Rooster Energy estimated assets of less than
$50,000 and liabilities of $50 million to $100 million. The
petition was signed by Kenneth F. Tamplain, Jr., president and
chief executive officer.
Jan M. Hayden, Esq., Lacey Rochester, Esq., Susan C. Mathews, Esq.,
and Daniel J. Ferretti, Esq., at Baker Donelson Bearman Caldwell &
Berkowitz, P.C., serve as bankruptcy counsel. The Debtors hired
Donlin Recano & Company, Inc., as claims, noticing and solicitation
agent.
Counsel for Angelo, Gordon Energy Servicer, LLC, the administrative
agent and collateral agent on behalf of itself and the holders of
secured notes issued pursuant to a Note Purchase Agreement, dated
as of November 17, 2014, Louis M. Phillips, Esq., at Kelly Hart &
Pitre, and Paul E. Heath, Esq., and Bradley R. Foxman, Esq., at
Vinson & Elkins LLP.
Henry G. Hobbs, Jr., Acting U.S. Trustee for Region 5, on June 22,
2017, appointed two creditors to serve on the official committee of
unsecured creditors in the Chapter 11 case of Cochon Properties,
LLC.
ROOSTER ENERGY: Taps Opportune as Restructuring Advisor
-------------------------------------------------------
Rooster Energy, L.L.C. seeks approval from the U.S. Bankruptcy
Court for the Western District of Louisiana to hire Opportune LLP
as restructuring advisor.
The firm will provide these services to the company and its
affiliates in connection with their Chapter 11 cases:
(a) assist in the preparation of bankruptcy documents;
(b) assist in the preparation of financial-related
disclosures required by the court;
(c) assist in the preparation of financial information
including cash flow forecasts, long term business plans,
and other key information;
(d) assist with respect to mortgages and lien perfections;
(e) assist in the identification of executory contracts and
leases and perform cost/benefit evaluations;
(f) analyze creditor claims;
(g) assist in the preparation of information and analysis
necessary for the confirmation of a plan of
reorganization;
(h) assist in the analysis and preparation of information
necessary to assess the tax implications related to the
confirmation of a plan;
(i) provide litigation advisory services with respect to
accounting and tax matters, along with expert witness
testimony on case-related issues; and
(j) provide support with respect to managing the day-to-day
requirements of the bankruptcy process.
The hourly rates charged by the firm are:
Partner $835
Managing Director $665
Director $475
Manager $425
Senior Consultant $385
Consultant $325
Opportune received an initial retainer of $75,000 on May 30. The
retainer was received from Jones Walker, LLP on behalf of Corn Meal
LLC, a special purpose entity formed by Jones Walker's client,
Chester Morrison, Jr.
Mr. Morrison owns approximately 85% of the issued common stock of
Rooster Energy, Ltd., an affiliate of Rooster Energy.
Sean Clements, a partner at Opportune, disclosed in a court filing
that his firm does not hold any interest adverse to the Debtors'
bankruptcy estates or their creditors.
The firm can be reached through:
Sean Clements
Opportune LLP
711 Louisiana, Suite 3100
Houston, TX 77002
Office: 713.490.5050
Email: sclements@opportune.com
About Rooster Energy
Houston, Texas-based Rooster Energy Ltd. --
http://www.roosterenergyltd.com-- is an integrated oil and natural
gas company with an exploration and production (E&P) business and a
downhole and subsea well intervention and plugging and abandonment
service business. The Company's operations are located in the
state waters of Louisiana and the shallow waters of the Gulf of
Mexico, mature regions that have produced since 1936.
Rooster Energy, L.L.C., Rooster Energy Ltd., and five other
affiliates filed a Chapter 11 petition (Bankr. W.D. La. Lead Case
No. 17-50705) on June 2, 2017. In its petition, Rooster Energy
L.L.C. estimated assets of less than $50,000 and liabilities of $50
million to $100 million. The petition was signed by Kenneth F.
Tamplain, Jr., president and chief executive officer.
Baker Donelson Bearman Caldwell & Berkowitz, P.C., serve as the
Debtors' bankruptcy counsel. The Debtors hired Donlin Recano &
Company, Inc. as their claims, noticing and solicitation agent.
Counsel for Angelo, Gordon Energy Servicer, LLC, the administrative
agent and collateral agent on behalf of itself and the holders of
secured notes issued pursuant to a Note Purchase Agreement, dated
as of November 17, 2014, are Louis M. Phillips, Esq., at KELLY HART
& PITRE; and Paul E. Heath, Esq. and Bradley R. Foxman, Esq., at
VINSON & ELKINS LLP.
ROYAL HOLDINGS: S&P Raises CCR to 'B' on Improved Credit Metrics
----------------------------------------------------------------
S&P Global Ratings raised its long-term corporate credit rating on
Royal Holdings Inc. to 'B' from 'B-'.
At the same time, S&P raised its rating on the company's first-lien
senior secured debt to 'B' from 'B-'. The recovery rating remains
'3', indicating S&P's expectation for meaningful (50%-70%; rounded
estimate: 50%) recovery in the event of a payment default. S&P also
raised its rating on the company's second-lien debt to 'CCC+' from
'CCC'. The recovery rating remains '6', indicating S&P's
expectation for negligible (0%-10%; rounded estimate: 5%) recovery
in the event of payment default.
The upgrade reflects S&P's expectation for gradual EBITDA
improvement for 2017 and 2018. In 2016, the company generated
solid cash flow, and generated stronger EBITDA and profitability
measures than S&P previously forecasted due to a favorable raw
material pricing environment and improved product mix, combined
with the company's focus on supply chain improvement initiatives.
S&P believes the improved operating performance will result in a
funds from operations (FFO) to debt ratio between 10% and 12%.
S&P's expectations at the previous rating for this ratio was below
10%. S&P expects the company's financial policies will remain
aggressive and the company's financial profile will remain highly
leveraged with debt to EBITDA above 5x due to the company's
financial sponsor ownership by American Securities LLC. In
addition, S&P expects Royal to continue to pursue strategic tuck-in
acquisitions, and use excess cash flow to reduce outstanding
revolver balances.
The stable outlook reflects S&P Global Ratings' view that Royal
Holdings Inc. will maintain a capital structure that is consistent
with measures in the stronger end of the highly leveraged financial
risk profile, specifically with debt to EBITDA of between 5x and 6x
over the next 12 months, and FFO to debt is between 10% and 12%.
S&P's base case assumption is for oil prices to remain low and
support a low raw material pricing environment, which would
continue to benefit Royal's profitability measures. S&P also
expects the company will maintain its financial policy and pursue
modest-size acquisitions. At S&P's current rating, it do not
envisage a reduction in debt levels beyond modest amortizations or
any debt funded shareholder rewards.
S&P could lower ratings over the next 12 months if operating
challenges significantly decrease free cash flow generation so that
leverage increases to the greater than 6.5x on a sustained basis,
with no prospect of near-term improvement, which could happen if
EBITDA margins deteriorate by 200 bps. S&P could also lower the
ratings if the company's liquidity position deteriorates.
Additionally, S&P could downgrade Royal if the company pursues any
debt-funded dividend recapitalizations.
S&P could raise the ratings over the next year if the company
reduces debt to less than 5x debt to EBITDA and if FFO to debt
approaches 12% on what S&P believes to be a sustained basis, which
could happen if EBITDA margins improve by 200 basis points (bps).
An important consideration in any review for an upgrade would be
our assessment of management's support for credit measures
appropriate for a higher rating.
RUPARI FOOD: Court Approves Amended $1.4M Employee Bonus Plans
--------------------------------------------------------------
Vince Sullivan of Bankruptcy Law360 reports that U.S. Bankruptcy
Judge Kevin Carey has approved the amended Key Employee Incentive
Plan and Key Employee Retention Plan of Rupari Food Services, Inc.,
after reviewing submitted changes.
The Debtor changed terms of the KEIP to resolve objections from the
lender Antares Capital LP and the U.S. Trustee.
The maximum amount allowed under the KEIP for Rupari executives
remains capped at $1.4 million, but has been modified to state that
to qualify for bonuses under the plan, executives must remain
employed with the debtor full-time until the closing of an asset
sale, Law360 relays. Payment of health care benefits has been
removed from the plan, Law360 adds.
The KERP, aimed toward rank-and-file employees whose efforts are
needed as the company pursues a sale and ultimately a wind-down,
was also altered to resolve the objections, Law360 relates. A
provision that would have allowed employees to receive a portion of
their bonuses should they be terminated has been eliminated from
the plan, and the payments have been divided into two tranches,
Law360 points out.
Antares Capital's objection balked at the use of the cash
collateral for the bonus plan payments before its secured claim
could be satisfied, while the U.S. Trustee's objection pointed to
the easy-to-attain benchmarks for executives to attain under the
bonus plans, Law360 relates.
About Rupari Holding Corp.
Established in 1978, Rupari -- http://www.rupari.com/-- is a
culinary supplier of sauced and unsauced ribs, barbeque pork, and
BBQ chicken. Since 1978, Rupari Foods has been producing and
distributing the finest, restaurant-quality, pre-cooked, sauced,
bone-in proteins, and related barbeque products. The Company
offers a full line of meats under the Rupari brand name, as well
as a variety of products under the retail names of Tony Roma's and
Butcher's Prime. The Company's products are available at large
And mid-sized retailers throughout the United States and Canada.
Rupari Holding Corp. and its affiliate Rupari Food Services, Inc.
filed Chapter 11 petitions (Bankr. D. Del. Case Nos. 17-10793 and
17-10794, respectively) on April 10, 2017. The petitions were
signed by signed by Jack Kelly, CEO.
At the time of filing, the Debtors each estimated $50 million to
$100 million in assets and $100 million to $500 million in
liabilities.
The cases are assigned to Judge Kevin J. Carey.
R. Craig Martin, Esq., Maris J. Kandestin, Esq., Richard A.
Chesley, Esq., and John K. Lyons, Esq., at DLA Piper LLP (US) are
serving as counsel to the Debtors. Kinetic Advisors LLC is the
financial advisor. Donlin, Recano & Co., Inc., is the claims and
noticing agent.
Andrew R. Vara, Acting U.S. Trustee for Region 3, on April 20,
2017, appointed three creditors to serve on the official committee
of unsecured creditors in the Chapter 11 case of Rupari Holding
Corp.
The Committee tapped Lowenstein Sandler LLP as lead bankruptcy
counsel, Whiteford Taylor & Preston LLC, as Delaware counsel, and
CohnReznick LLP and CohnReznick Capital Market Securities, LLC, as
its financial advisor and investment banker.
RWK ELECTRIC: To Pay Unsecureds $30,300 Over Five Years
-------------------------------------------------------
RWK Electric Co., Inc., filed with the U.S. Bankruptcy Court for
the District of Arizona a disclosure statement dated June 14, 2017,
referring to the Debtor's plan of reorganization dated June 14,
2017.
Class IV consists of all Allowed General Unsecured Claims that are
not entitled to classification in any other class of claims. The
Debtor will pay holders of Allowed Class IV Claims the sum of
$30,300 over five years. The Debtor will pay the holders of
Allowed Class IV Claims on the first Business Day that occurs 11
months after the Effective Date and every year thereafter for four
years each Class IV Claimant's pro rata share of Allowed Class IV
Claims. The payments will be as follows: (i) Year One -- $6,000;
(ii) Year Two -- $6,000; (iii) Year Three -- $6,100; (iv) Year Four
-- $6,100; and (v) Year Five -- $6,100. Additionally, assuming
there is a remaining balance from the ASU Receivables and T-3
Receivables after payment of administrative claims and the Union
Claim, the Debtor will make a lump sum payment to the Allowed
General Unsecured Claims. No interest will accrue or be paid to
the holders of the Allowed Class IV Claims. If a disputed Class IV
Claim is not an allowed claim prior to 30 days after the Effective
Date, the Class IV Claim will receive payment on the one-year
payment date that falls after their Class IV Claim becomes an
Allowed Claim. The Class IV Claims are impaired.
The Debtor will fund the Plan with its prepetition receivables, its
post-petition income, and post-confirmation income. The
pre-petition receivables (including the ASU Receivables and T-3
Receivables) total approximately $615,845.83, excluding any
pre-liens; the total post-petition, pre-confirmation receivables
total approximately $54,464.86. Finally, Debtor has approximately
$248,874.43 on hand that is earmarked to help fund the Plan.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/azb16-14195-86.pdf
About RWK Electric Co.
RWK Electric Co., Inc., is an Arizona corporation in the business
of providing electrical services for commercial and residential
properties. The Debtor's principal, Rodney Kawulok, started the
business in Phoenix, Arizona in 1986. The Debtor is Small Business
Enterprise-certified, and it has established an excellent
reputation in the industry. The Debtor offers a wide range of
electrical services including: (i) general service for commercial
and residential properties; (ii) maintenance, configuration, and
installation of low and high voltage (AC and DC) systems; and (iii)
servicing and installing specialty systems, including fire and life
safety systems, generators, and other backup power systems.
The Debtor filed a Chapter 11 bankruptcy petition (Bankr. D. Ariz.
Case No. 16-14195) on Dec. 16, 2016. The petition was signed by
Rodney W. Kawulok, president. In its petition, the Debtor
estimated $1 million to $10 million in both assets and liabilities.
Judge Eddward P. Ballinger Jr. presides over the case. Allen
Barnes & Jones, PLC, represents the Debtor as counsel.
No official committee of unsecured creditors has been appointed in
the Debtor's case.
RYAN LLC: S&P Revises Outlook to Stable & Affirms 'B-' CCR
----------------------------------------------------------
S&P Global Ratings revised its rating outlook on U.S.-based Ryan
LLC. to stable from negative and affirmed its 'B-' corporate credit
ratings on the company.
The stable outlook on Ryan reflects S&P's expectation that the
company's liquidity will remain adequate over the next 12 months
and its performance will remain stable, with positive organic
revenue and EBITDA growth. S&P expects the company will maintain
an over 20% compliance headroom under its covenants.
The stable rating outlook reflects S&P's expectation that Ryan's
liquidity will remain adequate over the next 12 months and its
performance will remain stable, with low- to mid-single-digit
percentage organic revenue and EBITDA growth.
S&P could lower the corporate credit rating one notch to 'CCC+' if
Ryan's operating performance declines and S&P believes the company
is at risk of violating its financial covenants. A downgrade could
also occur if S&P views Ryan's leverage as unsustainable and
believe the company would find it challenging to refinance its debt
maturing in 2020.
S&P would raise the rating if the company decreases its leverage to
4x. Additionally, an update would require that S&P become
convinced Ryan would generate enough cash flow internally for the
business to fund its growth. This would likely entail the company
generating meaningful discretionary cash flow and reducing its
average days sales outstanding (DSO) on it unbilled revenue and
account receivables to more manageable levels.
S K TRANSPORT: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of S K Transport Inc. as of June
23, according to a court docket.
About S K Transport Inc.
S K Transport Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.W.V. Case No. 17-20298) on May 30,
2017. Charles Shannon, owner, signed the petition. At the time of
the filing, the Debtor estimated its assets and debts at $1 million
to $10 million.
Judge Frank W. Volk presides over the case. The Debtor hired
Joseph W. Caldwell, Esq., at Caldwell & Riffee as bankruptcy
counsel.
SANDERS NURSERY: Plan Solicitation Period Extended thru August 4
----------------------------------------------------------------
Judge Tom R. Cornish of the U.S. Bankruptcy Court for the Eastern
District of Oklahoma extended Sanders Nursery & Distribution
Center, Inc.'s exclusive period for obtaining acceptance of its
chapter 11 plan of reorganization, from June 7, 2017 to and
including August 4, 2017.
The Troubled Company Reporter has previously reported that the
Debtor filed its sixth request for an extension of the exclusive
solicitation period for its Second Modified First Amended Plan of
Reorganization.
The Debtor filed its chapter 11 Plan of Reorganization and
Disclosure Statement on April 1, 2016, which was amended on May 23,
2016. Following a hearing to consider the Disclosure Statement, on
June 17, 2016, the Court entered an order approving a modified
version of the Disclosure Statement. The Debtor then filed a
Modified Disclosure Statement to Accompany Debtor's First Amended
Plan of Reorganization, and set a confirmation hearing for August
24, 2016. The solicitation period had expired. The voting deadline
was July 22, 2016, and the deadline for filing objections to
confirmation of the Plan was August 8, 2016.
The Debtor said that all ballots received were cast in favor of the
Plan and no objections to confirmation were filed, with the
exception of the ballots of BFN Operations, LLC. The Debtor also
said that BFN Operations later assigned its claim in the Debtor's
bankruptcy case to Nursery Solutions, LLC.
On February 20, 2017, the Debtor filed its Modified First Amended
Plan of Reorganization. Thereafter, on May 12, 2017, the Debtor
filed its Second Modified First Amended Plan of Reorganization,
which includes, among other things, a guaranty of all plan
performance and payment obligations by one its equity owners, Burl
Berry. The confirmation hearing was scheduled for May 23 and 24.
However, the Debtor said that after it filed a second modified
plan, claimant Nursery Solutions requested a 60-day extension of
time to conduct further discovery, to which the Debtor consented.
In addition, the Debtor told the Court that upon the filing of
Nursery Solutions' application to continue the confirmation
hearing, the hearing was stricken, and a status hearing was held on
May 24, concerning, among other things, notice of the second
modified plan and scheduling a new hearing date.
The Debtor said the Plan modifications have enhanced recoveries for
Class 4 and 5 creditors, increase the likelihood that the Plan will
be fully performed, and represent the Debtor's good faith efforts
to reach a consensual resolution of its bankruptcy case. In
addition, the Debtor claimed that it was not attempting to pressure
creditors to accede to its reorganization demands, but instead, the
Debtor will utilize the extended exclusivity period to further its
good faith efforts towards reorganization.
The Debtor noted the five prior requests for exclusivity extension
were unopposed and that the Assistant U.S. Trustee, counsel for the
Committee, and counsel for Nursery Solutions have no objections to
the current requested extension.
About Sanders Nursery & Distribution Center
Headquartered in Tahlequah, Oklahoma, Sanders Nursery &
Distribution Center, Inc., filed for Chapter 11 bankruptcy
protection (Bankr. E.D. Okla. Case No. 15-81312) on Dec. 4, 2015.
The petition was signed by Burl Berry, vice president. Judge Tom
R. Cornish presides over the case. The Debtor estimated its assets
and liabilities at $1 million to $10 million at the time of the
filing. Brandon Craig Bickle, Esq., at Gable & Gotwals, P.C.,
serves as the Debtor's bankruptcy counsel.
An Official Committee of Unsecured Creditors was appointed in the
case by the Office of the United States Trustee on December 29,
2015. The Committee is represented by Mac Finlayson of Eller &
Detrich.
SEARS CANADA: CA$63.5 Million Directors' Charge Okayed
------------------------------------------------------
Sears Canada Inc. and its subsidiaries on June 22, 2017, told the
Ontario Superior Court of Justice, Commercial List, that a
successful restructuring will only be possible with the continued
participation of its directors, management and employees. These
personnel are essential to the viability of the Applicants'
continuing business and the preservation of enterprise value.
Accordingly, the Applicants sought and obtained an order from the
Ontario Court to set a directors' and officers' charge in an amount
of up to $63.5 million.
With the assistance of the Monitor, the Applicants estimated the
potential exposure of the Applicants' present and former directors
and officers for unpaid statutory amounts, including unpaid accrued
wages, unpaid accrued vacation pay and unpaid sales and services
taxes at approximately $64 million.
Sears Canada's present and former directors and officers who are or
were employed by Sears Canada are among the potential beneficiaries
under liability insurance policies that cover an
aggregate annual limit of US$50 million. The Applicants do not
believe that this insurance policy provides sufficient coverage
against the potential liability that the directors and officers
could incur in relation to this CCAA proceeding.
The Applicants' directors and officers have indicated that, due to
the potential for significant personal liability associated with
the CCAA proceeding, they cannot continue their service and
involvement during the stay period unless the Initial Order
includes the Directors' Charge.
The Directors' Charge would act as security for indemnification
obligations for the Directors' and officers' potential
liabilities.
The Directors' Charge is bifurcated into a "Directors' Priority
Charge" in the amount of $44 million and the "Directors'
Subordinated Charge" in the amount of $19.5 million. The
Directors' Priority Charge is proposed to stand in priority to the
proposed charges for the DIP Revolver and DIP Term Loan (the "DIP
Lenders' Charges") and the $4.6 million KERP Subordinated Charge,
but would be subordinate to the proposed the $5 million charge for
the Monitor and the Applicants' attorneys ("Administration Charge")
and $3.3 million charge for the Applicants' financial advisor ("FA
Charge"), and $4.6 million KERP Priority Charge. The Directors'
Subordinate Charge is proposed to be subordinate to the DIP
Lenders' Charges and the $4.6 million KERP Subordinated Charge.
The Applicants claimed that the requested Directors' Charge is
reasonable given the nature of the Applicants' retail business, the
number of employees and the corresponding potential exposure of the
directors and officers to personal liability. The magnitude of the
Directors Charge is consistent with the directors' charges granted
other large and/or complex CCAA proceedings.
About Sears Canada
Sears Canada Inc. (TSX: SCC; NASDAQ: SRSC) -- http://www.sears.ca/
-- is one of Canada's largest multi-format retailers, employing
17,000 people at 225 stores across Canada and at its head office in
Toronto, Ontario (as of June 22, 2017). Sears Canada and its
subsidiaries sell goods and services through its full-line
department stores, Sears Home, Sears Hometown, Sears Outlet, and
Corbeil stores, and via its online sales platform.
As of June 13, 2017, Sears Holdings Corp. CEO Edward S. Lampert and
his investment fund ESL Investments, Inc., held 46,162,515 common
shares, representing 45.3% of Sears Canada's total outstanding
common shares. In addition, Sears Holdings held 11,962,391 common
shares, representing 11.7% of the shares outstanding. Fairholme
Capital Management, LLC, held 20,375,533 shares, representing 20%
of the shares outstanding.
The Company's balance sheet as of April 29, 2017, showed total
assets of CA$1.187 billion against total liabilities of CA$1.108
billion.
Amid mounting losses and liquidity constraints Sears Canada and
certain of its subsidiaries on June 22, 2017, applied to the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act ("CCAA"), in order
to continue to restructure its business.
The Company has engaged BMO Capital Markets, as financial advisor,
and Osler, Hoskin & Harcourt LLP, as legal advisor. The Board of
Directors and the Special Committee of the Board of Directors of
the Company has retained Bennett Jones LLP, as legal advisor.
FTI Consulting Canada Inc. is the monitor. FTI tapped Norton Rose
Fulbright Canada LLP as counsel.
* * *
Sears Canada and its subsidiaries on June 22, 2017, were granted an
order (the "Initial Order") under the Companies' Creditors
Arrangement Act (the "CCAA"). Pursuant to the Initial Order, FTI
Consulting has been appointed Monitor. The Initial Order also
provides for a stay of proceedings for an initial 30-day period
until July 22, 2017, subject to further extensions by the Court.
SEARS CANADA: CA$9.2-Mil. Key Employee Retention Plan Approved
--------------------------------------------------------------
At the behest of Sears Canada Inc. and its subsidiaries, the
Ontario Superior Court of Justice, Commercial List, on June 22,
2017, approved a key employee retention plan and granted a
court-ordered charge -- KERP Charge -- up to the aggregate amount
of $9.2 million as security for payments under the KERP.
The KERP was developed by the Applicants, in consultation with
Osler, Hoskin & Harcourt LLP and with the involvement of FTI
Consulting Canada, to facilitate and encourage the continued
participation of senior management and other key employees of the
Applicants who are required to guide the business through the
restructuring and preserve value for stakeholders. The KERP will
provide its participants with additional payments as an incentive
to continue their employment through the CCAA proceedings. These
employees have significant experience and specialized expertise
that cannot be easily replicated or replaced. Further, these key
employees will likely have other, more certain employment
opportunities and will be faced with a significantly increased
workload during the restructuring process. Additionally, certain
senior store level employees are included in the KERP in order to
facilitate a successful liquidation of the closing stores and an
orderly exit from the premises.
The Applicants proposed to include these employees in the KERP:
Number of
Role Employees Estimated Cost
---- ---------- --------------
HQ Employees 43 $7.6 million
Closing Store Employees 116 $1.6 million
--- ------------
Total 159 $9.2 million
The KERP payments for the HQ employees will be made in three
installments payable as follows: (i) 45 days after the filing date;
(ii) 90 days after the filing date; and (iii) 180 days after the
filing date.
In the event of the completion of a successful restructuring plan
in this CCAA proceeding and (where applicable) the successful
completion of specified Key Performance Indicator ("KPI")
milestones (as determined by management), then all unpaid
installments become payable.
The first, second and third installments will each be in an amount
equal to 25 percent of the total KERP payment payable to the HQ
employee in question. The final 25 percent of the total KERP
payment only becomes payable upon the completion of the successful
restructuring. The total KERP payments for the HQ employees range
from 25 percent to 100 percent of the base salary of the relevant
employees.
The KERP payments for the closing store employees will be made upon
the closure of the store where the employee was employed and the
successful achievement of certain KPIs. The KERP payments for the
closing store employees are in an amount equal to 25 percent of the
employees' base salaries.
If the Sears Canada Group finds itself in a full liquidation
scenario, any amounts not yet earned by HQ employees who are not
part of the liquidation process would instead be eligible to be
used to provide a KERP for store level personnel at the additional
closing stores.
The current version of the KERP only provides incentive payments
for store level employees for stores that are known to be closing
at the outset of the CCAA proceedings. It is therefore proposed
that the Applicants, with the consent of the Monitor, be provided
with the flexibility to transfer all or a portion of those unused
KERP amounts for HQ employees who are not part of the liquidation
process to store level employees in a full liquidation scenario.
Assuming the Applicants are able to retain all of the key employees
and all of the milestones are met, the total amount payable under
the KERP would be a maximum of approximately $9.2 million.
The Applicants sought a charge (the "KERP Charge") to secure the
amounts payable under the KERP. A portion of the KERP Charge (the
"KERP Priority Charge") is proposed to rank immediately below the
$5 million charge for the Monitor and the Applicants' attorneys
("Administration Charge") and $3.3 million charge for the
Applicants' financial advisor ("FA Charge") and immediately above
the $36.5 charge in favor of directors and officers (Directors'
Priority Charge"). The remainder of the KERP Charge (the "KERP
Subordinated Charge") is proposed to rank immediately below the
charges for the DIP Revolver and DIP Term Loan (the "DIP Lenders'
Charges") and immediately above $16.5 million charge for the
directors and officers (the "Directors' Subordinated Charge").
The Initial Order entered June 22, 2017, provides for approval of
up to $4.6 million for the KERP Priority Charge and up to $4.6
million for the KERP Subordinated Charge.
About Sears Canada
Sears Canada Inc. (TSX: SCC; NASDAQ: SRSC) -- http://www.sears.ca/
-- is one of Canada's largest multi-format retailers, employing
17,000 people at 225 stores across Canada and at its head office in
Toronto, Ontario (as of June 22, 2017). Sears Canada and its
subsidiaries sell goods and services through its full-line
department stores, Sears Home, Sears Hometown, Sears Outlet, and
Corbeil stores, and via its online sales platform.
As of June 13, 2017, Sears Holdings Corp. CEO Edward S. Lampert and
his investment fund ESL Investments, Inc., held 46,162,515 common
shares, representing 45.3% of Sears Canada's total outstanding
common shares. In addition, Sears Holdings held 11,962,391 common
shares, representing 11.7% of the shares outstanding. Fairholme
Capital Management, LLC, held 20,375,533 shares, representing 20%
of the shares outstanding.
The Company's balance sheet as of April 29, 2017, showed total
assets of CA$1.187 billion against total liabilities of CA$1.108
billion.
Amid mounting losses and liquidity constraints Sears Canada and
certain of its subsidiaries on June 22, 2017, applied to the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act ("CCAA"), in order
to continue to restructure its business.
The Company has engaged BMO Capital Markets, as financial advisor,
and Osler, Hoskin & Harcourt LLP, as legal advisor. The Board of
Directors and the Special Committee of the Board of Directors of
the Company has retained Bennett Jones LLP, as legal advisor.
FTI Consulting Canada Inc. is the monitor. FTI tapped Norton Rose
Fulbright Canada LLP as counsel.
* * *
Sears Canada and its subsidiaries on June 22, 2017, were granted an
order (the "Initial Order") under the Companies' Creditors
Arrangement Act (the "CCAA"). Pursuant to the Initial Order, FTI
Consulting has been appointed Monitor. The Initial Order also
provides for a stay of proceedings for an initial 30-day period
until July 22, 2017, subject to further extensions by the Court.
SEARS CANADA: FTI Consulting Approved as CCAA Monitor
-----------------------------------------------------
The Ontario Superior Court of Justice, Commercial List, on June 22,
2017, approved the request of Sears Canada Inc. and its
subsidiaries to appoint FTI Consulting Canada Inc. as an officer of
the Court to monitor the assets, businesses and affairs of the
Sears Canada Group.
Professionals from FTI will be onsite in the field and at Sears
Canada head office on a regular basis, working with the Company
throughout the CCAA process. FTI's responsibilities include
monitoring the Company's restructuring initiatives, assisting the
Company with the preparation of cash flow statements and other
financial reporting, liaising with stakeholders, and reporting to
the Court from time to time on the progress of the CCAA
proceedings.
Court materials, including reports prepared by the Monitor, will be
available at the Monitor's website,
http://cfcanada.fticonsulting.com/searscanada
As directed in the Initial Order entered June 22, 2017, Sears
Canada and their shareholders, officers, directors, and assistants
shall advise the Monitor of all material steps taken by the Sears
Canada Group, and will co-operate fully with the Monitor in the
exercise of its powers and discharge of its obligations and provide
the Monitor with the assistance that is necessary to enable the
Monitor to adequately carry out the Monitor's functions.
Norton Rose Fulbright Canada LLP is the Monitor's counsel.
The Ontario Court has approved a request that the Monitor, along
with its counsel, and attorneys to Sears Canada be protected by a
Court-ordered charge on all of the property of the Applicants up to
a maximum amount of $5 million as security for their respective
fees and disbursements (the "Administration Charge").
According to the Initial Order, the Monitor is directed and
empowered to:
(a) monitor the Sears Canada Group's receipts and
disbursements;
(b) liaise with the Sears Canada Group and the Assistants and,
if determined by the Monitor to be necessary, the Hometown Dealers
and Corbeil Franchisees, with respect to all matters relating to
the Property, the Business, the Restructuring and such other
matters as may be relevant to the proceedings herein;
(c) report to the Court at such times and intervals as the
Monitor may deem appropriate with respect to matters relating to
the Property, the Business, the Restructuring and such other
matters as may be relevant to the CCAA proceedings;
(d) assist the Sears Canada Group, to the extent required by the
Sears Canada Entities, in their dissemination of financial and
other information to the DIP ABL Agent, the DIP ABL Lenders, the
DIP Term Agent, the DIP Term Lenders and each of their respective
counsel and financial advisors, pursuant to and in accordance with
the Definitive Documents;
(e) advise the Sears Canada Group in their preparation of the
Sears Canada Entities' cash flow statements and any reporting
required by the Definitive Documents, which information will be
reviewed with the Monitor and delivered to the DIP ABL Agent, the
DIP ABL Lenders, the DIP Term Agent, the DIP Term Lenders and each
of their respective counsel and financial advisors, pursuant to and
in accordance with the Definitive Documents;
(f) advise the Sears Canada Group in their development of the
Plan and any amendments to the Plan;
(g) assist the Sears Canada Group, to the extent required by the
Sears Canada Entities, with the holding and administering of
creditors' or shareholders' meetings for voting on the Plan;
(h) have full and complete access to the Property (including any
Property in the possession of the Hometown Dealers and the Corbeil
Franchisees), including the premises, books, records, data,
including data in electronic form, and other financial documents of
the Sears Canada Entities, to the extent that is necessary to
adequately assess the Business and the Sears Canada Entities'
financial affairs or to perform its duties arising under this
Order;
(i) be at liberty to engage independent legal counsel or such
other persons as the Monitor deems necessary or advisable
respecting the exercise of its powers and performance of its
obligations;
(j) assist the Sears Canada Entities, to the extent required by
the Sears Canada Entities, with any matters relating to any foreign
proceeding commenced in relation to any of the Sears Canada
Entities, including retaining independent legal counsel, agents,
experts, accountants, or such other persons as the Monitor deems
necessary or desirable respecting the exercise of this power; and
(k) perform other duties as are required by the Initial Order or
by the Court from time to time.
About Sears Canada
Sears Canada Inc. (TSX: SCC; NASDAQ: SRSC) -- http://www.sears.ca/
-- is one of Canada's largest multi-format retailers, employing
17,000 people at 225 stores across Canada and at its head office in
Toronto, Ontario (as of June 22, 2017). Sears Canada and its
subsidiaries sell goods and services through its full-line
department stores, Sears Home, Sears Hometown, Sears Outlet, and
Corbeil stores, and via its online sales platform.
As of June 13, 2017, Sears Holdings Corp. CEO Edward S. Lampert and
his investment fund ESL Investments, Inc., held 46,162,515 common
shares, representing 45.3% of Sears Canada's total outstanding
common shares. In addition, Sears Holdings held 11,962,391 common
shares, representing 11.7% of the shares outstanding. Fairholme
Capital Management, LLC, held 20,375,533 shares, representing 20%
of the shares outstanding.
The Company's balance sheet as of April 29, 2017, showed total
assets of CA$1.187 billion against total liabilities of CA$1.108
billion.
Amid mounting losses and liquidity constraints Sears Canada and
certain of its subsidiaries on June 22, 2017, applied to the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act ("CCAA"), in order
to continue to restructure its business.
The Company has engaged BMO Capital Markets, as financial advisor,
and Osler, Hoskin & Harcourt LLP, as legal advisor. The Board of
Directors and the Special Committee of the Board of Directors of
the Company has retained Bennett Jones LLP, as legal advisor.
FTI Consulting Canada Inc. is the monitor. FTI tapped Norton Rose
Fulbright Canada LLP as counsel.
* * *
Sears Canada and its subsidiaries on June 22, 2017, were granted an
order (the "Initial Order") under the Companies' Creditors
Arrangement Act (the "CCAA"). Pursuant to the Initial Order, FTI
Consulting has been appointed Monitor. The Initial Order also
provides for a stay of proceedings for an initial 30-day period
until July 22, 2017, subject to further extensions by the Court.
SEARS CANADA: To End Pension Payments, Retirees Hire Counsel
------------------------------------------------------------
Sears Canada Inc. said it plans to file a motion with the Ontario
Superior Court of Justice, Commercial List, to suspend monthly
payments for the defined benefit component of its pension plan
because it is running low on cash.
The Sears Canada Group currently maintains these pension
arrangements:
(a) Sears Canada Inc. Registered Retirement Plan, a pension plan
registered under the Ontario Pension Benefits Act, R.S.O. 1990, c.
P.8 (the "PBA") and the Income Tax Act, R.S.C. 1985, c. 1 (5th
Supp) (the "ITA") with a defined benefit component and a defined
contribution component, and which is maintained for employees of
Sears Canada, Sears Contact, Corbeil and SLH (the "Sears Pension
Plan");
(b) Sears Canada Inc. Supplementary Retirement Plan, a
non-registered supplemental pension plan maintained to provide
benefits to eligible participants in the defined benefit component
of the Sears Pension Plan (the "Supplemental Plan");
(c) Pension Plan for the eligible Employees of 168886 Canada
Inc., a pension plan registered under the Pension Benefits
Standards Act, R.S.C. 1985, c. 32 (2nd. Supp.) (the "PBSA") and the
ITA which provides defined contribution pension benefits to
employees in the Eastern Division of 168886 Canada Inc. (the
"168886 Eastern Plan");
(d) Pension Plan for the eligible Employees of 168886 Canada
Inc., a pension plan registered under the PBSA and the ITA which
provides defined contribution pension benefits to employees in the
Western Division of 168886 Canada Inc. (the "168886 Western Plan");
and
(e) A U.S. defined contribution pension plan for the employees
of The Cut Inc. (the "401K Plan") that is provided through a third
party administrator, Trinet.
In addition, all permanent employees of the Sears Canada Group are
eligible to join a group registered retirement savings plan (the
"Group RRSP") on a voluntary basis. No member of the Sears Canada
Group is required to make any contributions in respect of any of
its employees that participate in the Group RRSP.
Sears Canada also maintains a post-retirement benefit plan, which
provides life insurance, medical and dental benefits to eligible
retired employees of the Sears Canada Group through an employee
health and welfare trust (the "PRB Plan").
Sears Canada has 17,000 employees. The average monthly wage costs
of Sears Canada's work-force during the first quarter of Fiscal
2017 was approximately $31 million per month, excluding costs
relating to pension and benefits.
On June 22, 2017, Sears Canada said that it is closing 20 full-line
locations, plus 15 "Sears Home" Stores, 10 "Sears Outlet" and 14
"Sears Hometown" locations. Following the closings, Sears Canada
will have 75 full-line department stores, 8 Sears Home stores, 0
Outlet stores, 49 Hometown stores, and 32 Corbeil stores. The
closures will result in a reduction in workforce of 2,900 positions
across its retail network and at its corporate head office in
Toronto.
Sears Canada also said it is filing a motion to seek approval to
(i) make special payments with respect to the defined benefit
portion of the Sears Pension Plan and (ii) make payments with
respect to other post-retirement benefits under the PRB Plan.
DB Component of Sears Pension Plan
The Sears Pension Plan consists of a defined benefit component ("DB
Component") and a defined contribution component ("DC Component").
Sears Canada acts as both the sponsor employer and as the
"administrator" of the Sears Pension Plan for the purposes of the
PBA. The DB Component of the Sears Pension Plan was closed to new
entrants as of June 30, 2008 and all members of the DB Component
ceased to accrue pensionable service after June 30, 2008. However,
earnings increases continue to be recognized for participants in
the DB Component while such members are in active employment with
Sears Canada.
Contributions to the DB Component of the Sears Pension Plan are
required to be made in accordance with the most recent actuarial
valuation report that has been filed with the pension regulator,
the Financial Services Commission of Ontario, which was prepared as
at Dec. 31, 2015 and dated September 2016 (the "Pension Valuation
Report"). The Pension Valuation Report indicates that, as at
December 31, 2015, the hypothetical wind-up deficit under the DB
Component of the Sears Pension Plan was $266,805,000 and the
transfer (wind-up) ratio was 81%.
The Pension Valuation Report indicates that, in accordance with
temporary funding relief options available in Ontario, Sears Canada
elected to consolidate the existing solvency special payments
established prior to Dec. 31, 2015 into a new five-year payment
schedule and elected to defer by 12 months (i.e., to Dec. 31, 2016)
the commencement of special payments relating to the new solvency
deficiency established through the Pension Valuation Report. The
combined effect of these two elections resulted in the minimum
annual special payments required to be made to the Sears Pension
Plan being approximately $44.2 million for the calendar years
2017-2020 and approximately $30.5 million for the 2021 calendar
year. These special payment obligations may be modified pursuant
to the next valuation report for the DB Component of the Sears
Pension Plan, which is required to be performed no later than as at
Dec. 31, 2018. These special payments are currently required to be
made in equal monthly installments of approximately $3.7 million
and are due at the end of each month.
As service accruals ceased under the DB Component of the Sears
Pension Plan effective July 1, 2008, no normal cost contributions
are required for the DB Component of the Sears Pension Plan
(however, normal cost contributions continue to be made under the
Sears Pension Plan in respect of the employees in the Sears Canada
Group that participate in the DC Component of the Sears Pension
Plan). As of Dec. 31, 2016, there were 16,921 members in the DB
Component of the Sears Pension Plan (3,025 active/disabled
members; 160 transferred members; 195 suspended members; 396
deferred vested members; and 13,121 retired members).
Based on the significantly constrained liquidity position of the
Applicants, the Applicants intend to serve a motion in the near
term seeking court approval to cease making the monthly special
payments for the DB Component of the Sears Pension Plan. The Sears
Canada Group can no longer afford to make these special payments in
respect of the DB Component of the Sears Pension Plan as it
attempts to restructure under the CCAA. The cash forecasts do not
include making any special payments beyond June 2017.
Eligible active employees of Sears Canada, Sears Contact, Corbeil
and SLH11 are eligible to participate in the DC Component of the
Sears Pension Plan. Under the DC Component of the Sears Pension
Plan, employees can select a contribution level from 1% to 7% of
earnings (which includes base pay, variable pay, overtime pay and
commissions). The participating employers under the DC Component
of the Sears Pension Plan are required to make a matching
contribution equal to 50% of the contributions made by an employee
(i.e., subject to a maximum match of 3.5% of earnings). There were
5,409 associates enrolled in the DC Component of the Sears Pension
Plan as at May 25, 2017, with an additional 7,476 associates that
were eligible to participate in the DC Component of the Sears
Pension Plan but who had not enrolled. In Fiscal 2016, the Sears
Canada Group made contributions of $4.8 million to the DC Component
of the Sears Pension Plan. Sears Canada Group has paid to the
Sears Pension Plan all contributions that are due (under both the
DB Component and the DC Component of the Sears Pension Plan).
Retiree Group Hires Attorneys
Sears Canada recounts that a group of former Sears Canada
executives has formed a retiree group to advance their interests in
respect of the Sears Pension Plan (the "Retiree Group"). The
Retiree Group retained Koskie Minsky LLP as their counsel and Sears
Canada has recently started paying their reasonable legal fees.
Sears Canada has been communicating with the Retiree Group with
respect to the funded status and ongoing administration of the DB
Component of the Sears Pension Plan. The Applicants intend to
continue this dialogue and engage with the Retiree Group as part of
the CCAA proceedings.
On June 22, 2017, the Ontario Superior Court of Justice Commercial
List signed an endorsement providing that Koskie Minsky LLP will be
appointed as representative counsel for active employees and
retirees with respect to pension matters regarding the defined
benefit component of the Sears Pension Plan, the Supplemental Plan
and the post-employment benefits, and Ursel Phillips Fellows
Hopkinson LLP will be appointed as representative counsel for
current and former employees whose rights are affected by this
order subject in each case to:
(a) terms of engagement to be reflected in a further order of
the Court, which may be granted as a consent order on consent of
the Applicants, the Monitor and representative counsel; and
(b) the comeback rights of any interested person to be heard on
July 13, 2017.
About Sears Canada
Sears Canada Inc. (TSX: SCC; NASDAQ: SRSC) -- http://www.sears.ca/
-- is one of Canada's largest multi-format retailers, employing
17,000 people at 225 stores across Canada and at its head office in
Toronto, Ontario (as of June 22, 2017). Sears Canada and its
subsidiaries sell goods and services through its full-line
department stores, Sears Home, Sears Hometown, Sears Outlet, and
Corbeil stores, and via its online sales platform.
As of June 13, 2017, Sears Holdings Corp. CEO Edward S. Lampert and
his investment fund ESL Investments, Inc., held 46,162,515 common
shares, representing 45.3% of Sears Canada's total outstanding
common shares. In addition, Sears Holdings held 11,962,391 common
shares, representing 11.7% of the shares outstanding. Fairholme
Capital Management, LLC, held 20,375,533 shares, representing 20%
of the shares outstanding.
The Company's balance sheet as of April 29, 2017, showed total
assets of CA$1.187 billion against total liabilities of CA$1.108
billion.
Amid mounting losses and liquidity constraints Sears Canada and
certain of its subsidiaries on June 22, 2017, applied to the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act ("CCAA"), in order
to continue to restructure its business.
The Company has engaged BMO Capital Markets, as financial advisor,
and Osler, Hoskin & Harcourt LLP, as legal advisor. The Board of
Directors and the Special Committee of the Board of Directors of
the Company has retained Bennett Jones LLP, as legal advisor.
FTI Consulting Canada Inc. is the monitor. FTI tapped Norton Rose
Fulbright Canada LLP as counsel.
* * *
Sears Canada and its subsidiaries on June 22, 2017, were granted an
order (the "Initial Order") under the Companies' Creditors
Arrangement Act (the "CCAA"). Pursuant to the Initial Order, FTI
Consulting has been appointed Monitor. The Initial Order also
provides for a stay of proceedings for an initial 30-day period
until July 22, 2017, subject to further extensions by the Court.
SERVICE WELDING: Taps Mark A. Weber as Accountant
-------------------------------------------------
Service Welding & Machine Company LLC seeks approval from the U.S.
Bankruptcy Court for the Western District of Kentucky to hire an
accountant.
The Debtor proposes to hire Mark A. Weber CPA PSC to, among other
things, prepare tax returns, perform adjusting entries to
bookkeeping, and provide other accounting services related to its
Chapter 11 case.
The firm will charge $100 to $140 per hour depending on the
complexity of work performed.
Mark Weber, a certified public accountant, 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:
Mark A. Weber
Mark A. Weber CPA PSC
4175 Wesport Road, Suite 206
Louisville, KY 40207
About Service Welding & Machine Company
Service Welding & Machine Company, LLC, based in Louisville,
Kentucky, sells and installs single and double wall storage tanks
for a variety of industries including petroleum, chemical,
distillery, potable water, industrial, and food/agriculture.
Service Tanks was established in 1928 and was primarily
manufacturing storage tanks and doing repair work. In 2013, the
owners sold the business to Jeff Androla, president, and two other
investors.
The Debtor filed a Chapter 11 petition (Bankr. W.D. Ky. Case No.
17-30485) on Feb. 17, 2017. The Hon. Joan A. Lloyd presides over
the case. In its petition, the Debtor estimated $516,432 in assets
and $2.12 million in liabilities. The petition was signed by Jeff
Androla, president. Charity B. Neukomm, Esq., at Kaplan & Partners
LLP, serves as bankruptcy counsel to the Debtor.
SKIP BARBER RACING: Taps Rust/Omni as Claims & Noticing Agent
-------------------------------------------------------------
Skip Barber Racing School LLC seeks authorization from the U.S.
Bankruptcy Court for the Southern District of New York to employ
Rust Consulting/Omni Bankruptcy ("Omni") as claims and noticing
agent.
The Debtor requires Omni to:
(a) prepare and serve required notices and documents in the
chapter 11 case in accordance with the Bankruptcy Code and
the Federal Rules of Bankruptcy Procedure in the form and
manner directed by the Debtor and/or the Court, including
(i) notice of the commencement of the chapter 11 cases and
the initial meeting of creditors under Bankruptcy Code
section 341(a), (ii) notice of any claims bar date, (iii)
notices of transfers of claims, (iv) notices of objections
to claims and objections to transfers of claims, (v)
notices of any hearings on a disclosure statement and
confirmation of the Debtor's plan or plans of
reorganization, including under Bankruptcy Rule 3017(d),
(vi) notice of the effective date of any plan and (vii) all
other notices, orders, pleadings, publications and other
documents as the Debtor or Court may deem necessary or
appropriate for an orderly administration of the chapter 11
case;
(b) maintain an official copy of the Debtor's schedules of
assets and liabilities and statement of financial affairs,
listing the Debtor's known creditors and the amounts owed
thereto;
(c) maintain (i) a list of all potential creditors, equity
holders and other parties-in-interest; and (ii) a "core"
mailing list consisting of all parties described in
sections 2002(i), (j) and (k) and those parties that have
filed a notice of appearance pursuant to Bankruptcy Rule
9010; update said lists and make said lists available upon
request by a party-in-interest or the Clerk;
(d) furnish a notice to all potential creditors of the last
date for the filing of proofs of claim and a form for the
filing of a proof of claim, after such notice and form are
approved by this Court, and notify said potential creditors
of the existence, amount and classification of their
respective claims as set forth in the Schedules, which may
be effected by inclusion of such information on a
customized proof of claim form provided to potential
creditors;
(e) maintain a post office box or address for the purpose of
receiving claims and returned mail, and process all mail
received;
(f) for all notices, motions, orders or other pleadings or
documents served, prepare and file or caused to be filed
with the Clerk an affidavit or certificate of service
within 7 business days of service which includes (i) either
a copy of the notice served or the docket numberss and
titles of the pleadings served, (ii) a list of persons to
whom it was mailed with their addresses, (iii) the manner
of service, and (iv) the date served;
(g) process all proofs of claim received, including those
received by the Clerk's Office, and check said processing
for accuracy, and maintain the original proofs of claim in
a secure area;
(h) maintain the official claims register for the Debtor (the
"Claims Register") on behalf of the Clerk on a case
specific website; upon the Clerk's request, provide the
Clerk with certified, duplicate unofficial Claims Register;
and specify in the Claims Register the following
information for each claim docketed: (i) the claim number
assigned, (ii) the date received, (iii) the name and
address of the claimant and agent, if applicable, who filed
the claim, (iv) the amount asserted, (v) the asserted
classifications of the claim, (vi) the applicable Debtor,
and (vii) any disposition of the claim;
(i) provide public access to the Claims Registers, including
complete proofs of claim with attachments, if any, without
charge;
(j) implement necessary security measures to ensure the
completeness and integrity of the Claims Register and the
safekeeping of the original claims;
(k) record all transfers of claims and provide any notices of
such transfers as required by Bankruptcy Rule 3001(e);
(l) relocate, by messenger or overnight delivery, all of the
court-filed proofs of claim to the offices of Claims and
Noticing Agent, not less than weekly;
(m) upon completion of the docketing process for all claims
received to date for the case, turn over to the Clerk
copies of the Claims Register for the Clerk's review;
(n) monitor the Court's docket for all notices of appearance,
address changes, and claims-related pleadings and orders
filed and make necessary notations on and changes to the
Claims Register;
(o) assist in the dissemination of information to the public
and respond to requests for administrative information
regarding the case as directed by the Debtor or the Court,
including through the use of a case website and call
center;
(p) if the case is converted to chapter 7, contact the Clerk's
Office within 3 days of the notice to Claims and Noticing
Agent of entry of the order converting the case;
(q) Thirty days prior to the close of this case, to the extent
practicable, request that the Debtor submit to the Court a
proposed Order dismissing the Claims and Noticing Agent and
terminating the services of such agent upon completion of
its duties and responsibilities and upon the closing of
these cases;
(r) Within 7 days of notice to Claims and Noticing Agent of
entry of an order closing the chapter 11 case, provide to
the Court the final version of the Claims Register as of
the date immediately before the close of the chapter 11
case; and
(s) at the close of this case, box and transport all original
documents, in proper format, as provided by the Clerk's
Office, to (i) the Federal Archives Record Administration,
located at Central Plains Region, 200 Space Center Drive,
Lee's Summit, MO 64064 or (ii) any other location requested
by the Clerk's Office.
Omni will be paid on an hourly rate:
Clerical Support $26.25-$37.50
Project Specialists $48.75-$63.75
Project Supervisors $63.75-$78.75
Consultants $78.75-$105
Technology/Programming $82.50-$123.75
Senior Consultants $131.25-$146.25
Equity Services $168.75
Omni will also be reimbursed for reasonable out-of-pocket expenses
incurred.
Paul H. Deutch, executive managing director of Omni, 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 Debtor and its estate.
Omni can be reached at:
Paul H. Deutch
RUST CONSULTING/OMNI BANKRUPTCY
1120 Avenue of the Americas, 4th Floor
New York, NY 10036
Tel: (212) 302-3580
Fax: (212) 302-3820
About Skip Barber Racing School
Skip Barber Racing School LLC is a Braselton, Georgia-based racing
school. It operates a fully-integrated system of racing schools,
driving schools, racing championships, corporate events and OEM
events across North America, teaching emergency braking, skid and
slide control, proper cornering techniques, an understanding of
vehicle dynamics, and a variety of other car-control skills.
Skip Barber Racing School filed a Chapter 11 bankruptcy petition
(Bankr. S.D.N.Y. Case No. 17-35871) on May 22, 2017. The petition
was signed by Michael Culver, managing member. The Debtor
estimated $1 million to $10 million in assets and $10 million to
$50 million in debt.
Judge Cecelia G. Morris presides over the case. Gerard R. Luckman,
Esq. and Brian J. Hufnagel, Esq., at Forchelli, Curto, Deegan,
Schwartz, Mineo & Terrana, LLP serve counsel.
No trustee, examiner or committee of creditors has been appointed.
SPANISH BROADCASTING: Six Directors Elected by Stockholders
-----------------------------------------------------------
Spanish Broadcasting System, Inc., held its annual meeting of
stockholders on June 15, 2017, at which the stockholders elected
Raul Alarcon, Joseph A. Garcia, Manuel E. Machado, Jason L.
Shrinsky, Jose A. Villamil and Mitchell A. Yelen as directors to
hold office until such time as their respective successors have
been duly elected and qualified.
Alan Miller and Gary Stone, the two directors elected by the
holders of the Series B Preferred Stock at the 2014 annual meeting,
were not subject to election at this year's annual meeting and
continue to serve as directors.
About Spanish Broadcasting
Spanish Broadcasting System, Inc. (OTCMKTS:SBSAA) --
http://www.spanishbroadcasting.com/-- is one of the largest owners
and operators of radio stations in the United States. SBS owns and
operates 17 radio stations located in the top U.S. Hispanic markets
of New York, Los Angeles, Miami, Chicago, San Francisco and Puerto
Rico, airing the Spanish Tropical, Regional Mexican, Spanish Adult
Contemporary, Top 40 and Latin Rhythmic format genres. SBS also
operates AIRE Radio Networks, a national radio platform which
creates, distributes and markets leading Spanish-language radio
programming to over 250 affiliated stations reaching 93% of the
U.S. Hispanic audience. SBS also owns MegaTV, a television
operation with over-the-air, cable and satellite distribution and
affiliates throughout the U.S. and Puerto Rico. SBS also produces
live concerts and events and owns multiple bilingual websites,
including http://www.LaMusica.com/, an online destination and
mobile app providing content related to Latin music, entertainment,
news and culture.
Spanish Broadcasting reported a net loss of $16.34 million for the
year ended Dec. 31, 2016, compared with a net loss of $26.95
million for the year ended Dec. 31, 2015. As of March 31, 2017,
Spanish Broadcasting had $451.13 million in total assets, $575.99
million in total liabilities and a total stockholders' deficit of
$124.86 million.
Crowe Horwath LLP, in Fort Lauderdale, Florida, issued a "going
concern" qualification on the consolidated financial statements for
the year ended Dec. 31, 2016, stating that the 12.5% Senior Secured
Notes had a maturity date of April 15, 2017. Cash from operations
or the sale of assets was not sufficient to repay the notes and
other short term obligations when they became due, which resulted
in significant liquidity requirements on the Company that raise
substantial doubt about its ability to continue as a going
concern.
* * *
As reported by the TCR on May 25, 2017, S&P Global Ratings withdrew
its 'D' corporate credit rating and issue-level ratings on
U.S.-based Spanish-language broadcaster Spanish Broadcasting
System. "We withdrew the ratings because we were unlikely to raise
them from 'D', based on SBS' ongoing plans to restructure its
debt," said S&P Global Ratings' credit analyst Scott Zari. S&P had
downgraded SBS to 'D' on April 21, 2017, following the company's
announcement that it didn't repay its $275 million 12.5% senior
secured notes that were due April 15, 2017.
In April 2017, Moody's Investors Service downgraded SBS's corporate
family rating to 'Ca' from 'Caa2'. SBS's 'Ca' corporate family
rating reflects an elevated expected loss rate following the
recently announced default under the company's 12.5% senior secured
notes due April 2017.
SPI ENERGY: BNY Mellon Reschedules ADR Termination Date
-------------------------------------------------------
The Bank of New York Mellon, the depositary for SPI Energy Co.,
Ltd.'s American depositary shares, issued a notice on June 16,
2017, to holders of the Company's ADSs that it had rescheduled the
termination of the Company's existing American Depositary Receipts
facility to Sept. 18, 2017.
The Depositary has waived its American Depositary Share
cancellation fees from June 16, 2017, to the Termination Date.
Owners and holders of ADSs may surrender their ADSs for delivery of
the underlying shares of SPI. However, owners and holders of ADSs
remain liable for any applicable U.S. or local taxes or
governmental charges upon the surrender of the ADSs and the
delivery of the underlying shares of SPI.
Subsequent to the Termination Date, under the terms of the Deposit
Agreement, the Depositary may attempt to sell the underlying
shares. Please be advised that there is currently no public
trading market for the SPI ordinary shares. Therefore, the
Depositary may not be able to sell the underlying shares or receive
any value for them. If the Depositary has sold such underlying
shares or received value for such shares, you must surrender your
ADSs to obtain payment of the sale proceeds, net of the expenses of
sale, and any applicable U.S. or local taxes or government
charges.
To surrender your ADRs, the address of the Depositary is: The Bank
of New York Mellon, 101 Barclay Street, Depositary Receipts
Division -- 22nd Floor, Attention: Cancellation Desk, New York, NY
10286. Registered or overnight mail is the suggested method of
delivering ADRs to the Depositary. For further information
regarding your ADRs, please contact the Depositary at
1-888-269-2377 for US callers or 1-201-680-6825 for non-US
callers.
Note: As of Feb. 27, 2017, BNY Mellon is no longer the Exchange
Agent for processing the exchange of the common stock of Solar
Power, Inc. for ADSs representing ordinary shares of SPI. Any
inquiries pertaining to such Exchange may be directed to the
following individuals at SPI: Mr. Xiaofeng Peng (email:
Idkpeng@spisolar.com) or Mr. Tairan Guo (email:
tairan.guo@spisolar.com).
About SPI Energy Co., Ltd.
SPI Energy Co., Ltd. is a global clean energy market place for
business, residential, government and utility customers and
investors. SPI Energy focuses on the downstream PV market including
the development, financing, installation, operation and sale of
utility-scale, residential/commercial solar power and storage
projects, and clean energy solution provider in China, Japan,
Europe and North America. The Company operates an innovative
online energy e-commerce and investment platform, www.solarbao.com,
which enables individual and institutional investors to purchase
innovative PV-based investment and other products; as well as
www.solartao.com, a B2B e-commerce platform offering a range of PV
products for both upstream and downstream suppliers and customers.
The Company has its operating headquarters in Hong Kong and
maintains global operations in Asia, Europe, North America and
Australia.
SPI Energy reported a net loss of $185 million on $191 million of
net sales for the year ended Dec. 31, 2015, compared to a net
loss of $5.19 million on $91.6 million of net sales for the year
ended Dec. 31, 2014.
As of Dec. 31, 2015, SPI Energy had $710 million in total assets,
$493 million in total liabilities and $216.6 million in total
stockholders' equity.
KPMG Huazhen LLP, in Shanghai, China, issued a "going concern"
qualification on the consolidated financial statements for the
year ended Dec. 31, 2015, citing that SPI Energy Co., Ltd., and
its subsidiaries have suffered significant losses from operations
and have a negative working capital as of Dec. 31, 2015. In
addition, the Group has substantial amounts of debts that will
become due for repayment in 2016. The auditors said these
factors raise substantial doubt about the Group's ability to
continue as a going concern.
SPRUHA SHAH: Voluntary Chapter 11 Case Summary
----------------------------------------------
Affiliated debtors that simultaneously filed Chapter 11 bankruptcy
petitions:
Debtor Case No.
------ --------
Spruha Shah, LLC 17-18858
194 Hillandale D.
Bloomingdale, IL 60108
Sneh and Sahil Enterprises, Inc. 17-18861
194 Hillandale Dr.
Bloomingdale, IL 60108
Business Description: Spruha Shah listed its business as a Single
Asset Real Estate (as defined in 11 U.S.C.
Section 101(51B).
Sneh and Sahil also known as Arlington
Rental -- http://www.arlingtonrental.com/--
provides party & event rentals and tools &
equipment rentals.
Chapter 11 Petition Date: June 22, 2017
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Deborah L. Thorne (17-18858)
Hon. Benjamin A. Goldgar (17-18861)
Debtors' Counsel: Timothy C. Culbertson, Esq.
LAW OFFICES OF TIMOTHY C. CULBERTSON
1107 Lincoln Ave.
Fox River Grove, IL 60021
Tel: (847) 913-5945
Fax: (847) 574-8220
E-mail: tcculb@yahoo.com
tcculb@gmail.com
Estimated Estimated
Assets Liabilities
---------- -----------
Spruha Shah, LLC $1M-$10M $1M-$10M
Sneh and Sahil Enterprises $1M-$10M $1M-$10M
The petitions were signed by Sanjay Shah, managing member.
The Debtors each did not file a list of its 20 largest unsecured
creditors on the Petition Date.
Full-text copies of the petitions are available for free at:
http://bankrupt.com/misc/ilnb17-18858.pdf
http://bankrupt.com/misc/ilnb17-18861.pdf
STAFFING GROUP: Incurs $3.85 Million Net Loss in 2016
-----------------------------------------------------
The Staffing Group Ltd. filed with the Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss of
$3.85 million for the year ended Dec. 31, 2016, compared to a net
loss of $272,364 for the year ended Dec. 31, 2015.
Contract staffing services were $4.278 million for the year ended
Dec. 31, 2016, a decrease of $1,684,477 or 28.3% from $5.962
million (Predecessor) for the year ended Dec. 31, 2015. The
decrease in revenue is primarily due the Company's decision of not
accepting new contracts from third party vendors.
Cost of staffing services were $2.908 million for the year ended
Dec. 31, 2016, a decrease of $1.561 million or 34.9% from $4.469
million (Predecessor) for the year ended Dec. 31, 2015. The
decrease in cost of services is due to the decrease in net revenues
and increase in gross profit percentage. Fluctuations in cost of
sales items are based on the number of contracts on going at a
given point in time.
Gross profit was $1.370 million for the year ended Dec. 31, 2016,
which is approximately 32.0% of contract staffing services revenue,
from $1.493 million (Predecessor) for the year ended Dec. 31, 2015,
which is approximately 25.1% of contract staffing services revenue.
The increase in gross profit is due to the Company seeking out
contracts with higher gross profit percentage.
As of Dec. 31, 2016, Staffing Group had $1.95 million in total
assets, $4.93 million in total liabilities and a total
stockholders' deficit of $2.98 million. The Company's
stockholders' deficiency is primarily due to, among other reasons,
funding its historical net losses.
As of Dec. 31, 2016, the Company had a working capital deficit of
$3.506 million.
The Company's principal sources of liquidity include cash from
operations and proceeds from debt and equity financings. As of
Dec. 31, 2016, the Company had $123,156 in bank indebtedness.
"The Company is funding its operations primarily through the sale
of equity, convertible notes payable and shareholder loans. In the
event the Company experiences liquidity and capital resources
constraints because of greater than anticipated sales growth or
acquisition needs, the Company may need to raise additional capital
in the form of equity and/or debt financing including refinancing
its current debt. Issuances of additional shares will result in
dilution to its existing shareholders. There is no assurance that
the Company will achieve any additional sales of its equity
securities or arrange for debt or other financing to fund any
potential acquisition needs or increased growth. If such
additional capital is not available on terms acceptable to the
Company, or at all, then the Company may need to curtail its
operations and/or take additional measures to conserve and manage
its liquidity and capital resources, any of which would have a
material adverse effect on its business, results of operations and
financial condition. The ability to successfully resolve these
factors raise substantial doubt about the Company's ability to
continue as a going concern within one year from the date of this
filing. The consolidated financial statements of the Company do
not include any adjustments that may result from the outcome of
these aforementioned uncertainties. In order to mitigate the risk
related with this uncertainty, the Company plans to issue
additional shares of common stock for cash and services during the
next 12 months," as disclosed in the report.
On April 1, 2016, the Company purchased the operating assets of
four branch locations in Charlotte, NC, Indianapolis, IN,
Nashville, TN and Raleigh, NC from Labor Smart, Inc. for
consideration with a fair value of $2,666,000. The financial
statements present a summary of continuing operations for the year
ended Dec. 31, 2016, with comparative operations from the Four
Branches (Charlotte, North Carolina, Indianapolis, Indiana,
Nashville, Tennessee and Raleigh, North Carolina) acquired on April
1, 2016, from the carved-out financial statements Labor Smart, Inc
for the year ended Dec. 31, 2015 (the "Predecessor").
A full-text copy of the Form 10-K is available for free at:
https://is.gd/UUitxE
About The Staffing Group, Ltd.
Headquartered in Kennesaw, GA, The Staffing Group, Ltd. --
http://www.staffinggroupltd.com/-- is engaged in the business of
providing temporary staffing solutions. The Company provides
general laborers to construction, light industrial, refuse, retail
and hospitality businesses, and recruits, hires, trains and manages
skilled workers. The Company operates approximately one staffing
location in Montgomery, Alabama through its subsidiary, Staff Fund
I, LLC. Staff Fund I, LLC, is focused in the blue collar staffing
industry.
SUNEDISON INC: Oracle America Objects to Transition Services Pact
-----------------------------------------------------------------
Rick Archer, writing for Bankruptcy Law360, reports that Oracle
America Inc. has objected to a proposed transition services
agreement between SunEdison, Inc., and its yieldcos.
According to Law360, Oracle America claims that the deal may impact
its intellectual property. The report shares that Oracle America
told the U.S. Bankruptcy Court for the Southern District of New
York that the Debtor's motion to approve the deal does not give
sufficient detail for the software company to determine if any of
its contracts would be transferred to the Debtor's affiliated
yieldcos, TerraForm Power Inc. and TerraForm Global Inc., but that
the Court should reject the motion if they do.
Law360 quoted Oracle America as saying, "If the TSA contemplates
that the transitional services the Debtors will provide to TERF
includes the shared use of Oracle licensed software and services,
or if the TSA purports to grant to both the debtors and TERF the
right to simultaneous use of, and access to, Oracle's software,
such use exceeds the scope of the permitted uses under the Oracle
agreements, and constitutes an unauthorized splitting of the
respective licenses."
Oracle America is represented by in-house counsel Deborah Miller,
Esq., and Michael Czulada, Esq., and:
Amish R. Doshi, Esq.
Shawn M. Christianson
MAGNOZZI & KYE, LLP
New York Office
23 Green Street
Suite 302
Huntington, New York 11743
Tel: (844) 340-7454
Fax: (631) 923-2860
E-mail: adoshi@magnozzikye.com
-- and --
Valerie Bantner Peo, Esq.
BUCHALTER PC
55 Second Street
Suite 1700
San Francisco, California 94105-3493
Tel: (415) 227-3533
Fax: (415) 227-0770
Mobile: (415) 516-5021
E-mail: vbantnerpeo@buchalter.com
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 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.
SunEdison also tapped Eversheds LLP as its special counsel for
Great Britain and the Middle East. Cohen & Gresser LLP has also
been retained as special counsel.
The Debtors retained Ernst & Young LLP to provide tax-related
services. Keen-Summit Capital Partners LLC has been hired as real
estate advisor. Binswanger of Texas, Inc., also has been retained
as real estate agent.
Sullivan & Cromwell LLP serves as counsel to TerraForm Power, Inc.,
and TerraForm Global, Inc.
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. Togut, Segal & Segal LLP and Kobre & Kim LLP serve as
conflicts counsel. Alvarez & Marsal North America, LLC, serves as
the committee's financial advisors.
Counsel to the administrative agent under the Debtors' prepetition
first lien credit agreement are Richard Levy, Esq., and Brad
Kotler, Esq., at Latham & Watkins.
Counsel to the administrative agent under the postpetition DIP
financing facility are Scott Greissman, Esq., and Elizabeth Feld,
Esq. at White & Case LLP.
Counsel to the Tranche B Lenders (as defined in the DIP credit
agreement) and the steering committee of the second lien creditors
are Arik Preis, Esq., and Naomi Moss, Esq., at Akin Gump Strauss
Hauer & Field, LLP.
Counsel to the administrative agent under the Debtors' prepetition
second lien credit agreement is Daniel S. Brown, Esq., at Pillsbury
Winthrop Shaw Pittman LLP.
The collateral trustee under the Debtors' prepetition second lien
credit agreement and the indenture trustee under each of the
Debtors' outstanding bond issuances, is represented by Marie C.
Pollio, Esq., at Shipman & Goodwin LLP.
Counsel to the ad hoc group of certain holders of the Debtors'
convertible senior notes is White & Case LLP's Tom Lauria, Esq.
SUNEDISON INC: Unsecureds to Recoup 2.8% Under Amended Plan
-----------------------------------------------------------
SunEdison, Inc., et al., filed with the U.S. Bankruptcy Court for
the Southern District of New York a first amended disclosure
statement dated June 12, 2017, for the Debtors' first amended joint
plan of reorganization.
Each holder of Class 4A-4E General Unsecured Claims will receive
its pro rata portion of the Class A GUC/Litigation Trust Interests,
subject to the specifics set forth in the Plan. For the avoidance
of doubt, holders of an Allowed General Unsecured Claims will not
receive any of the Class B GUC/Litigation Trust Interests. The
holders will recover 2.8%.
Class 4 General Unsecured Claims are impaired by the Plan.
Distributions to holders of General Unsecured Claims will be made,
based on their pro rata portion of the Class A GUC/Litigation Trust
Interests, from the GUC/Litigation Trust which will distribute the
potential value from assets reserved for the benefit of Holders of
General Unsecured Claims pursuant to the Committee DIP Settlement
and the Committee/BOKF Plan Settlement. The GUC/Litigation Trust
will be seeded with $7.5 million, and the GUC/Litigation Trust
Causes of Action, the D&O Insurance Proceeds, the YieldCo Avoidance
Allocation, and the Voluntary Professional Fee Reduction Amount
will be transferred to the GUC/Litigation Trust. Distributions
from the GUC/Litigation Trust will be on a consolidated basis
without reference to Debtor-specific Claims.
The value available to fund the Plan consists of the following
components:
(i) the value that will be realized by the Debtors' Estates
as a result of the consideration received prior to
consummation of the Jointly Supported Transactions which
are made possible as a result of the settlements that the
Debtors reached with the YieldCos (which settlements were
approved by the Bankruptcy Court on June 7, 2017); (the
agreements documenting the terms of the Jointly Supported
Transactions were entered into on March 6, 2017, and are
still subject to YieldCo shareholder and regulatory
approval);
(ii) the value that has been and will be realized (including
after the Effective Date) by the Debtors' Estates from
the proceeds of asset sales by the Debtors and non-
Debtors (other than the Jointly Supported Transactions)
that have occurred and continue to occur during the
Chapter 11 cases, including, without limitation, direct
asset sale proceeds and earnouts realized after the
closing of any sales;
(iii) solely in the event of the TERP Share Election
Alternative, the proceeds of (A) the Rights Offering,
backstopped by the Rights Offering Backstop Purchasers on
a fully committed basis, pursuant to which eligible
holders of Second Lien Claims will be offered the rights
to purchase 67.5% of the New SUNE Common Stock and 67.5%
of the Continuing TERP Class A Shares to be issued or
distributed under the Plan, and receive a portion of the
Reinstated Second Lien Claims pursuant to the Reinstated
Second Lien Modification Terms in the same proportion as
they will hold New SUNE Common Stock, which will generate
gross cash proceeds of $213.75 million (subject to
increase to $225 million); and (B) the direct purchase of
22.5% of the New SUNE Common Stock and 22.5% of
Continuing TERP Class A Shares to be issued or
distributed under the Plan by the Rights Offering
Backstop Purchasers, resulting in gross cash proceeds of
$71.25 million (subject to increase to $75 million);
(iv) remaining cash on hand of the Debtors, and any cash that
the Reorganized Debtors receive after the Effective Date,
from Residual Assets Proceeds, Earnout Assets, and
Repatriated Cash; and
(v) other sources of value, including, without limitation,
the D&O Insurance Proceeds.
The Plan incorporates the Debtors' sale, distribution, or transfer
of all of their interests in the YieldCos, either pursuant to the
Jointly Supported Transactions, or, pursuant to the Plan
immediately following completion of the Jointly Supported
Transactions. Pursuant to the Jointly Supported Transaction
Agreements, the Debtors will sell (for cash) all of their interests
in GLBL. Pursuant to the TERP Merger Agreement and the TERP
Settlement Agreement, and in exchange for the Debtors' Class B
Shares of TERP Inc. common stock and Class B units of TERP LLC, the
Debtors will receive Class A shares of TERP Inc. common stock, and
with respect to each Class A share of TERP Inc. common stock held
by them, either (1) elect to retain one Continuing TERP Class A
Share and receive $4.50 in cash or (2) elect to receive $9.52 in
Cash and retain zero Continuing TERP Class A Shares.
The Debtors will only elect the TERP Cash Election Alternative in
the event that (a) they do not receive a commitment to fully
backstop the Rights Offering, (b) the Rights Offering Backstop
Commitment is not approved by the Court, or (c) the Equity
Commitment Agreement is terminated prior to the date that the
Debtors need to make their election.
In the TERP Share Election Alternative only, the Continuing TERP
Class A Shares will be offered to Eligible Holders of Second Lien
Claims pursuant to the Rights Offering. The Rights Offering will
be backstopped by the Supporting Second Lien Parties on a fully
committed basis.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/nysb16-10992-3314.pdf
As reported by the Troubled Company Reporter on June 20, 2017, the
Debtors filed with the Court a plan to exit Chapter 11 protection,
which incorporates the agreement that settles all litigation filed
or that may be filed in the future by BOKF, N.A., or the official
committee of unsecured creditors. Pursuant to that agreement,
certain assets would be transferred to a trust for the benefit of
general unsecured creditors in exchange for the settlement of all
litigation.
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 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.
SunEdison also tapped Eversheds LLP as its special counsel for
Great Britain and the Middle East. Cohen & Gresser LLP has also
been retained as special counsel.
The Debtors retained Ernst & Young LLP to provide tax-related
services. Keen-Summit Capital Partners LLC has been hired as real
estate advisor. Binswanger of Texas, Inc., also has been retained
as real estate agent.
Sullivan & Cromwell LLP serves as counsel to TerraForm Power, Inc.,
and TerraForm Global, Inc.
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. Togut, Segal & Segal LLP and Kobre & Kim LLP serve as
conflicts counsel. Alvarez & Marsal North America, LLC, serves as
the committee's financial advisors.
Counsel to the administrative agent under the Debtors' prepetition
first lien credit agreement are Richard Levy, Esq., and Brad
Kotler, Esq., at Latham & Watkins.
Counsel to the administrative agent under the postpetition DIP
financing facility are Scott Greissman, Esq., and Elizabeth Feld,
Esq. at White & Case LLP.
Counsel to the Tranche B Lenders (as defined in the DIP credit
agreement) and the steering committee of the second lien creditors
are Arik Preis, Esq., and Naomi Moss, Esq., at Akin Gump Strauss
Hauer & Field, LLP.
Counsel to the administrative agent under the Debtors' prepetition
second lien credit agreement is Daniel S. Brown, Esq., at Pillsbury
Winthrop Shaw Pittman LLP.
The collateral trustee under the Debtors' prepetition second lien
credit agreement and the indenture trustee under each of the
Debtors' outstanding bond issuances, is represented by Marie C.
Pollio, Esq., at Shipman & Goodwin LLP.
Counsel to the ad hoc group of certain holders of the Debtors'
convertible senior notes is White & Case LLP's Tom Lauria, Esq.
SUNRISE REAL ESTATE: Files Delayed 2014 Annual Report
-----------------------------------------------------
Sunrise Real Estate Group, Inc., recently filed with the Securities
and Exchange Commission its delayed annual report on Form 10-K for
the year ended Dec. 31, 2014. The Company previously notified the
SEC that its Form 10-K for the fiscal year ended Dec. 31, 2014,
would be delayed. The Company's prior accounting firm, Finesse
CPA, P.C. has ceased operation, is no longer registered with the
PCAOB and is no longer able to provide its consent to the use of
its audit report for 2013, which must accompany the Form 10K for
the fiscal year ended Dec. 31, 2014.
Sunrise Real reported a net loss of US$5.21 million on US$8.61
million of net revenues for the year ended Dec. 31, 2014, compared
to a net loss of US$6.74 million on US$11.24 million of net
revenues for the year ended Dec. 31, 2013.
As of Dec. 31, 2014, Sunrise Real had US$101.33 million in total
assets, US$104.63 million in total liabilities and a total
stockholders' deficit of US$3.29 million.
As of Dec. 31, 2014, the Company have approximately 597 record
holders of its common stock. On Dec. 31, 2014, the closing price
of its common stock was $0.04.
No cash dividends were declared on the Company's common stock in
2014 and 2013. The major reason for not declaring any cash
dividends is that the Company is still a growing company and
require sufficient liquidity to fund its business activities. In
the future, in the event the Company has funds available for
distribution, it may consider paying cash dividends on its common
stock.
The Company did not repurchase any of its outstanding equity
securities nor have any sales of unregistered securities during the
year ended Dec. 31, 2014.
In August and November 2014, the Company issued 40 million shares
in aggregate at $0.085 per share for $3,400,000 for cash in
aggregate to Ace Develop, of which Lin Chi-Jung, its CEO, President
and Chairman, is the sole shareholder.
As of Dec. 31, 2014, the Company had a working capital deficiency
of $9,527,421, an accumulated deficit from recurring net losses of
$19,780,232 and short-term debt obligations of $91,038,087.
"Management believes that the Company will generate sufficient cash
flows to fund its operations and to meet its obligations on timely
basis for the next twelve months by successful implementation of
its business plans, obtaining continued support from its lenders to
rollover debts when they became due, and securing additional
financing as needed," as disclosed in the report. "We have been
able to secure new bank lines of credit and secure additional loans
from affiliates to fund our operations to date. However, if events
or circumstances occur that the Company is unable to successfully
implement its business plans, fails to obtain continued supports
from its lenders or to secure additional financing, the Company may
be required to suspend operations or cease business entirely."
Kenne Ruan, CPA, P.C., in Woodbridge, Connecticut, issued a "going
concern" qualification on the consolidated financial statements for
the year ended Dec. 31, 2014, citing that the Company has a working
capital deficiency, accumulated deficit from recurring net losses
for the current and prior years, and significant debt obligations
are maturing in less than one year. These conditions raise
substantial doubt about its ability to continue as a going concern.
A full-text copy of the Form 10-K is available for free at:
https://is.gd/5tZouH
About Sunrise Real Estate
Headquartered in Shanghai, the People's Republic of China, Sunrise
Real Estate Group, Inc. was initially incorporated in Texas on
Oct. 10, 1996, under the name of Parallax Entertainment, Inc.
On Dec. 12, 2003, Parallax changed its name to Sunrise Real
Estate Development Group, Inc. On April 25, 2006, Sunrise Estate
Development Group, Inc., filed Articles of Amendment with the
Texas Secretary of State, changing the name of Sunrise Real Estate
Development Group, Inc. to Sunrise Real Estate Group, Inc.,
effective from May 23, 2006.
The Company and its subsidiaries are engaged in the property
brokerage services, real estate marketing services, property
leasing services and property management services in China.
T.W. BYRNE: Tractors and Trailers Up for Auction on June 28
-----------------------------------------------------------
By virtue of default by T.W. Byrne Transport, Inc., under the terms
of various agreements, People's United Equipment Finance Corp.
f/k/a Financial Federal Credit Inc. -- the holder of the agreements
and the indebtedness represented thereby -- will sell all of the
right, title and interest in and to the Collateral to the highest
qualified bidder at public sale on Wednesday, June 28, 2017, 11:30
a.m.
The auction will be held at:
T.W. Byrne Transport, Inc.
128 Sefton Avenue
Warwick, RI 02886
The Collateral consists of the Company's rights, title and interest
in and to
(3) 2012 Kenworth T700 Tractors, VINs: 1XKFD49X5CJ306300,
1XKFD49X9CJ306137, 1XKFD49X8CJ306128
(1) 2012 Kenworth T660 Tractor, VIN: 1XKAD49X2CJ305387
(1) 2010 Kenworth T660 Tractor, VIN: 1XKAD49X5AJ258028
(1) 2004 Kenworth T600 Tractor, VIN: 1XKADB9X34J061920
(4) 2006 Utility 53x102 Refrigerated Trailers, VINs:
1UYVS25306U011209, 1UYVS25396M614904, 1UYVS25306M614905,
1UYVS25376M614903
(3) 2004 Utility 53x102 Refrigerated Trailers, VINs:
1UYVS25304M065008, 1UYVS25394M065010, 1UYVS25324M065009
Prospective bidders must submit 25% of the purchase price payable
by certified or cashier's check at the time of sale, with the
balance payable in good funds by noon on the following business
day, unless the bidder has pre-qualified by presenting People's
United a commitment for funding from a source and in a form
acceptable to People's United in its sole discretion.
The bidder must have obtained credit approval from PUEFC in advance
of the sale date.
People's United reserves the right to bid at the sale.
For further information or to make inspection arrangements, please
contact Peter C. Huse at (201) 801-0300.
People's United may be reached at:
People's United Equipment Finance Corp.
f/k/a Financial Federal Credit Inc.
300 Frank W. Burr Blvd., Suite 50
Teaneck, NJ 07666
Tel: (201) 801-0300
TAKATA CORP: Selling Biz to Key Safety Systems for $1.59-Billion
----------------------------------------------------------------
Takata Corporation, a global supplier of automotive safety systems
such as seat belts, airbags and child seats, and its Chinese-owned
rival, Key Safety Systems ("KSS"), which is based in Sterling
Heights, Michigan, announced June 25, 2017, that they have reached
an agreement in principle to sponsor a restructuring plan for the
sale of substantially all of Takata's global assets and operations
to KSS for an aggregate purchase price of approximately JPY175
billion (US$1.588 billion), subject to certain adjustments at
closing.
Under the agreement, KSS will acquire substantially all of Takata's
assets, except for certain assets and operations that relate to the
Company's manufacturing and sale of phase-stabilized ammonium
nitrate (PSAN) airbag inflators (collectively, the "PSAN Assets").
It is expected that Takata's PSAN-related operations will be run by
a reorganized Takata following the transaction closing and
eventually will be wound down. Takata expects to continue to meet
demand for airbag inflator replacements without interruption.
By combining substantially all of Takata with KSS, the transaction
would form a leading global safety-supply auto parts company with
approximately 60,000 employees in 23 countries focused on serving
customers and providing superior products and innovation in the
rapidly evolving auto safety industry.
Jason Luo, President & CEO of KSS, said: "Takata has deep
management talent, a dedicated work force and a long history of
exceptional customer service. Although Takata has been impacted by
the global airbag recall, the underlying strength of its skilled
employee base, geographic reach, and exceptional steering wheels,
seat belts and other safety products has not diminished. We look
forward to finalizing definitive agreements with Takata in the
coming weeks, completing the transaction and serving both our new
and long-standing customers while investing in the next phase of
growth for the new KSS."
Shigehisa Takada, Chairman and CEO of Takata, said: "KSS is the
ideal sponsor as we address the costs related to airbag inflator
recalls, and an optimal partner to the Company's customers,
suppliers and employees. The combined business would be well
positioned for long-term success in the global automotive industry.
Throughout this process, our top priorities have been providing a
steady supply of products to our valued customers, including
replacement parts for recalls, and a stable home for our
exceptional employees. This agreement would allow that to
continue."
The proposed structure for the potential transaction is intended to
minimize supply chain disruption concerns for Takata's OEM
customers. The companies anticipate a quick and seamless
integration, utilizing the combined strengths of their respective
management teams to implement a smooth transition.
KSS will continue to support Takata's customers, suppliers and
employees and embrace and honor Takata's Japanese heritage:
* KSS plans to retain substantially all of Takata's employees
across the world on comparable employment terms as currently
provided.
* KSS has held in-depth discussions with Takata's major OEM
customers and has jointly developed a transaction structure and
operating plan to facilitate ongoing supply of Takata parts. This
should provide continuity of supply to Takata's customers and
confidence to Takata's employees, suppliers and other key
stakeholders.
* KSS plans to continue to support and utilize Takata's
presence in Japan, and does not intend to shut down any of Takata's
manufacturing facilities there. Furthermore, KSS intends to
establish an Asia regional headquarters in Tokyo, which should
create new jobs in Japan, and plans to retain Takata's existing
non-PSAN supplier contracts to maintain an uninterrupted supply
chain. KSS also intends to invest in many of Takata's other
worldwide manufacturing facilities and technology and R&D centers.
KSS has substantially completed its due diligence, and Takata and
KSS are working toward finalizing a definitive agreement in the
coming weeks, with an expected transaction close in the first
quarter of 2018.
Hideaki Sudo, Chairman of Takata's Steering Committee and Partner
at Tokyo Fuji Law office, said, "Since February 2016, the Steering
Committee has been working diligently, with assistance from our
financial and legal advisors, to develop a path forward for Takata
that resolves the recall costs and liabilities on a consensual
basis in partnership with Takata's automotive customers. After a
rigorous global process, the Committee has recommended KSS as the
best sponsor candidate based on a variety of factors including
strategic fit, valuation, and certainty of closing. We are pleased
that Takata has accepted such recommendation. We appreciate the
cooperation of the affected automotive manufacturers, who have
worked closely with us to devise this restructuring plan, which we
firmly believe is in the best interests of the Company and its
stakeholders."
Proceeds of the Sale
As contemplated and as expected to be detailed in the Plan, Takata
intends to use the Civil Rehabilitation in Japan and the Chapter 11
process in the U.S. to address the costs and liabilities related to
airbag inflator recalls, including to fund its remaining
obligations under the terms of the plea agreement with the U.S.
Department of Justice ("DOJ") that was announced on Jan. 13, 2017
("the DOJ Plea Agreement") and Consent Orders entered into by
Takata with the National Highway Traffic Safety Administration
("NHTSA").
Pursuant to the DOJ Plea Agreement, Takata paid $25 million as a
fine to the DOJ and was required to fund two restitution funds: (1)
a fund of $125 million to meet liabilities to current or future
personal injury claimants and (2) a fund of $850 million to satisfy
a portion of the claims of OEM customers who purchased airbags
containing PSAN inflators. Each of the restitution funds will be
administered by a special master in accordance with the DOJ Plea
Agreement. The $125 million fund for personal injury claimants was
funded on March 29, 2017. Consistent with the DOJ Plea Agreement,
the agreements in principle with the Customer Group and the
proposed restructuring terms provide for the proceeds of the sale
to KSS to be used to fund the $850 million OEM restitution fund.
After setting aside sufficient funds to capitalize RTK following
completion of the Chapter 11 process, any remaining sale proceeds
after satisfaction of the foregoing obligations and the payment of
other claims entitled to priority or payment in full would be used
to fund recoveries to holders of general unsecured claims.
Mr. Takada said, "We believe taking these actions in Japan and the
U.S. is the best way to address the ongoing costs and liabilities
of the airbag inflator issues with certainty and in an organized
manner while ensuring that Takata's operations worldwide continue
in the ordinary course and without interruption. During the Civil
Rehabilitation proceedings and Chapter 11 process and beyond,
Takata remains fully committed to supporting all actions that
advance vehicle safety. We deeply regret the circumstances that
have led to this situation, but we are grateful to have reached a
resolution that will allow us to continue to promote the safety of
the driving public."
The commencement of Civil Rehabilitation proceedings in Japan and
the Chapter 11 filing in the U.S. should have no effect on the
ability of drivers to get replacements for recalled Takata airbag
inflators free of charge. Vehicle owners in the U.S. should
continue to visit https://www.airbagrecall.com/ for more
information on airbag inflator replacements.
Debtor-in-Possession Financing
and Customer Accommodations
TKJP has obtained a commitment for up to a JPY25 billion (U.S. $227
million) revolving credit facility debtor-in-possession ("DIP")
financing from Sumitomo Mitsui Banking Corporation.
Additionally, the Japanese OEMs have committed to provide Takata
with valuable accommodations and liquidity enhancements during the
Civil Rehabilitation and the Company is working with the Customer
Group on an agreement to do so on a global basis. Upon approval by
the supervisor appointed by the Tokyo Court and approval by the
Delaware Court, the DIP financing in Japan and the accommodations
and additional liquidity support from the Customer Group in both
Japan and the U.S., along with Takata's cash flow from operations,
are expected to provide Takata with sufficient liquidity to
continue to operate its business and serve automotive customers
globally in the ordinary course and without any significant
disruptions.
Uninterrupted Global Operations
Shigehisa Takada, said, "We are committed to ensuring that the
restructuring process has as little impact as possible on our
employees, customers and suppliers across the world, as well as on
drivers whose safety is always our primary focus."
The Company has requested Court approval in the U.S. to continue to
pay its employees without interruption and in the same manner as
before the filing and expects the request to be granted as part of
the Court's "first day" orders. Also, under the Civil
Rehabilitation Act, the salaries of the Company's employees will be
statutorily protected. As a result, the Company's salaried and
hourly employees should continue to be paid on the normal schedule.
Additionally, there are expected to be no changes to various
employee benefit programs.
With the additional liquidity to be provided by the DIP financing
in Japan and the accommodations and other liquidity enhancements to
be provided globally by the Customer Group, the Company's suppliers
can be assured that Takata has the ability to pay its post-petition
obligations on a timely basis and intends to do so as required
under the Civil Rehabilitation Act and the U.S. Bankruptcy Code,
which grants priority status to goods and services received after
the Civil Rehabilitation and Chapter 11 filing date.
Mr. Takada added, "I would like to thank all of our constituents
for their continued support during this process. In particular, I
and the rest of our management team recognize that the Company's
success is dependent upon our talented and dedicated employees, and
we are grateful for their hard work and loyalty. We are taking
these actions to ensure that Takata remains a stable and
financially secure employer for thousands of workers in Japan, the
U.S. and across the world."
Media Contacts:
TAKATA:
U.S./U.K.
Sard Verbinnen & Co
Jared Levy/Devin Broda/Kelsey Markovich
212-687-8080
media@takata.com
- or -
Japan
Ashton Consulting
Dan Underwood, +81 (0) 3 5425-7220
media@takata.com
- or -
Germany/Europe
Hering Schuppener Consulting
Georg Lamerz, +49.211.430.79-276
Takata-hs@heringschuppener.com
KEY SAFETY SYSTEMS:
Global
KSS
Jean-Luc Blancou, +1-586-726-4046
blancoj2@keysafetyinc.com
- or -
Edelman
Chad Tendler, Nadia Damouni
+1-917-868-6899
+1-646-239-5723
E-mail: chad.tendler@edelman.com
nadia.damouni@edelman.com
- or -
Japan
Edelman
Deborah Hayden, +81 3 80-8741-0417
E-mail: deborah.hayden@edelman.com
About Key Safety Systems
Key Safety Systems (KSS) is a global leader in mobility safety
through the system integration and performance of safety-critical
components to the automotive and non-automotive markets serving the
active safety, passive safety and specialty product sectors. KSS'
technology is featured in more than 300 vehicle models produced by
over 60 well-diversified customers worldwide. KSS is headquartered
in Sterling Heights, Michigan, with a global network of more than
13,000 employees in 32 sales, engineering, and manufacturing
facilities. The company has five main technical centers located in
the key regions of the Americas, Europe and Asia. It is a wholly
owned subsidiary of Chinese firm Ningbo Joyson Electronic Corp.
(SHA:600699).
About Takata Corp
Japan-based Takata Corporation (TYO:7312) --
http://www.takata.com/en/-- develops, manufactures and sells
safety products for automobiles. The Company offers seatbelts,
airbags, steering wheels, child seats and trim parts.
Headquartered in Tokyo, Japan, Takata operates 56 plants in 20
countries with approximately 46,000 global employees worldwide.
The Company has subsidiaries located in Japan, the United States,
Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea,
China and other countries.
In May 1995, a voluntary recall in the U.S. affecting 8 million
predominantly Japanese built vehicles made from 1986 to 1991 with
seat belts manufactured by the Takata was conducted. Large recalls
of vehicles due to faulty Takata-made airbags then began in 2013.
Takata is facing massive costs of recalling 100 million defective
airbag inflators worldwide and lawsuits tied to at least 16 deaths
and numerous injuries.
As of May 19, 2015, Takata has already recalled 40 million
vehicles across 12 vehicle brands for defective airbags.
In November 2015, Takata was fined $200 million by U.S. federal
regulators for mishandling the way it recalled its air bag
inflators. The fine is the largest civil penalty in NHTSA
history.
After reaching a deal to sell all its global assets and operations
to Key Safety Systems (KSS) for US$1.588 billion, Takata and its
Japanese subsidiaries commenced proceedings under the Civil
Rehabilitation Act in Japan in the Tokyo District Court (the "Tokyo
Court") on June 25, 2017.
In addition, on June 25, 2017, Takata's main U.S. subsidiary TK
Holdings Inc. and eleven of its U.S. and Mexican affiliates each
filed voluntary petitions under Chapter 11 of the Bankruptcy Code
in the United States Bankruptcy Court for the District of Delaware.
The Debtors have requested that their cases be jointly
administered under Case No. 17-11375.
Nagashima Ohno & Tsunematsu is the counsel in the Japanese
proceedings. Weil, Gotshal & Manges LLP and Richards, Layton &
Finger, P.A., are serving as counsel in the U.S. cases.
PricewaterhouseCoopers is serving as financial advisor, and Lazard
is serving as investment banker to Takata. Ernst & Young LLP is
tax advisor.
Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal
counsel, KPMG is serving as financial advisor, Jefferies LLC is
acting as lead financial advisor while UBS Investment Bank also
provides financial advice to KSS.
Prime Clerk is the claims and noticing agent and maintains the case
Web site http://www.takata.com/
TAKATA CORP: Starts Civil Rehabilitation Proceedings in Japan
-------------------------------------------------------------
Takata Corp and its Japanese subsidiaries have commenced
proceedings under the Civil Rehabilitation Act in Japan in the
Tokyo District Court. In addition, Takata's U.S. and Mexican units
commenced Chapter 11 cases in the U.S. bankruptcy court in
Wilmington, Delaware, after reaching an agreement in principle for
Chinese-owned American rival, Key Safety Systems, to sponsor a
restructuring plan for the sale of substantially all of Takata's
global assets and operations to KSS for an aggregate purchase price
of JPY175 billion (US$1.588 billion).
Following the bankruptcy filings, the Tokyo Stock Exchange halted
trading of Takata's shares and stated it will delist the company on
Tuesday.
The commencement of Civil Rehabilitation proceedings in Japan and
the Chapter 11 filing in the U.S. should have no effect on the
ability of drivers to get replacements for recalled Takata airbag
inflators free of charge, Takata said.
Excluding recall-related costs and liabilities, Takata has
continued to produce healthy profits and cash flows from its
existing businesses. Nevertheless, Takata has determined that it
is in the best interests of the Company and its stakeholders to
address the recall-related issues in conjunction with the proposed
sale. Accordingly, with the expected support of a group of its OEM
customers representing more than 80% of Takata's annual sales (the
"Customer Group") and KSS as plan sponsor, Takata and its Japanese
subsidiaries have commenced proceedings under the Civil
Rehabilitation Act in Japan in the Tokyo District Court (the "Tokyo
Court").
The Civil Rehabilitation Act is Japan's version of U.S. Chapter 11
bankruptcy. The civil rehabilitation law is designed to help
distressed companies quickly reorganize before they fall into
insolvency.
The Japanese OEMs have committed to provide Takata with valuable
accommodations and liquidity enhancements during the Civil
Rehabilitation and the Company is working with the Customer Group
on an agreement to do so on a global basis. Takata intends to use
the Civil Rehabilitation Act and Chapter 11 processes to continue
to work with its Customer Group and KSS to finalize and execute
restructuring support agreements (each an "RSA") that would include
comprehensive terms of the restructuring. The RSAs will reflect the
commitment of the Customer Group and KSS to the restructuring
transactions to be effectuated pursuant to the Chapter 11 Plan of
Reorganization (the "Plan") that would be subject to approval of
the Delaware Court, as well as the business transfer to be
implemented by the Tokyo Court. The transaction with KSS would
also be subject to approval by the Tokyo Court and the Delaware
Court, as well as a number of other conditions, including
regulatory and other third-party approvals.
It is contemplated that upon the anticipated effective date of the
Plan, Takata's global PSAN Assets will be transferred to TKH or one
of its subsidiaries, as reorganized under the Plan ("RTK" or
"Reorganized Takata"), and all of the PSAN Assets, including PSAN
contracts, will be transferred to RTK. It is expected that RTK will
emerge from the Chapter 11 process and operate independently from
KSS under the supervision of a Plan administrator and oversight
board. RTK will continue to manufacture PSAN airbag inflators for
recalls and the ongoing production needs of Takata's customers.
It is expected that the proceedings under the Civil Rehabilitation
Act in Japan and Chapter 11 process in the U.S. will be completed
in the first quarter of 2018.
About Takata Corp
Japan-based Takata Corporation (TYO:7312) --
http://www.takata.com/en/-- develops, manufactures and sells
safety products for automobiles. The Company offers seatbelts,
airbags, steering wheels, child seats and trim parts.
Headquartered in Tokyo, Japan, Takata operates 56 plants in 20
countries with approximately 46,000 global employees worldwide.
The Company has subsidiaries located in Japan, the United States,
Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea,
China and other countries.
In May 1995, a voluntary recall in the U.S. affecting 8 million
predominantly Japanese built vehicles made from 1986 to 1991 with
seat belts manufactured by the Takata was conducted. Large recalls
of vehicles due to faulty Takata-made airbags then began in 2013.
Takata is facing massive costs of recalling 100 million defective
airbag inflators worldwide and lawsuits tied to at least 16 deaths
and numerous injuries.
As of May 19, 2015, Takata has already recalled 40 million
vehicles across 12 vehicle brands for defective airbags.
In November 2015, Takata was fined $200 million by U.S. federal
regulators for mishandling the way it recalled its air bag
inflators. The fine is the largest civil penalty in NHTSA
history.
After reaching a deal to sell all its global assets and operations
to Key Safety Systems (KSS) for US$1.588 billion, Takata and its
Japanese subsidiaries commenced proceedings under the Civil
Rehabilitation Act in Japan in the Tokyo District Court (the "Tokyo
Court") on June 25, 2017.
In addition, on June 25, 2017, Takata's main U.S. subsidiary TK
Holdings Inc. and eleven of its U.S. and Mexican affiliates each
filed voluntary petitions under Chapter 11 of the Bankruptcy Code
in the United States Bankruptcy Court for the District of Delaware.
The Debtors have requested that their cases be jointly
administered under Case No. 17-11375.
Nagashima Ohno & Tsunematsu is the counsel in the Japanese
proceedings. Weil, Gotshal & Manges LLP and Richards, Layton &
Finger, P.A., are serving as counsel in the U.S. cases.
PricewaterhouseCoopers is serving as financial advisor, and Lazard
is serving as investment banker to Takata. Ernst & Young LLP is
tax advisor.
Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal
counsel, KPMG is serving as financial advisor, Jefferies LLC is
acting as lead financial advisor while UBS Investment Bank also
provides financial advice to KSS.
Prime Clerk is the claims and noticing agent and maintains the case
Web site http://www.takata.com/
TAKATA CORP: U.S. & Mexican Units File for Chapter 11
-----------------------------------------------------
Takata Corporation's main U.S. subsidiary TK Holdings Inc. and 11
of its U.S. and Mexican affiliates each filed voluntary petitions
under Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court for the District of Delaware (Bankr. D. Del.) on
June 25, 2017. The Debtors have requested that their cases be
jointly administered under Case No. 17-11375.
The Chapter 11 debtors are:
* TK Holdings, Inc.;
* Takata Americas;
* TK Finance, LLC;
* TK China, LLC;
* Takata Protection Systems Inc.;
* Interiors in Flight Inc.;
* TK Mexico Inc.;
* TK Mexico LLC;
* TK Holdings de Mexico S. de R.L. de C.V.;
* Industrias Irvin de Mexico, S.A. de C.V.;
* Takata de Mexico, S.A. de C.V.; and
* Strosshe-Mex, S. de R.L. de C.V.
The Debtors' other international affiliates and subsidiaries are
not debtors in the chapter 11 cases.
Aside from the Chapter 11 filing, Takata and its Japanese
subsidiaries have commenced proceedings under the Civil
Rehabilitation Act in Japan in the Tokyo District Court (the "Tokyo
Court") after reaching a deal to sell most of the business to Key
Safety Systems for US$1.588 billion.
Takata said it is working with a group of its OEM customers
representing 80% of its annual sales (the "Customer Group") on an
agreement to provide Takata with valuable accommodations and
liquidity enhancements to finance the Chapter 11 cases. These
proposed accommodations would be in the form of waivers of setoff
rights, acceleration of payments to Takata, and resourcing
limitations.
Under Chapter 11, goods and services received on or after the
Chapter 11 filing date (June 25, 2017) are entitled to priority
status. Therefore, the Debtors will pay their obligations to
suppliers going forward in the ordinary course.
The Chapter 11 filing entities have sought authorization from the
Court to maintain their cash management systems in the ordinary
course across all of Takata's businesses in the U.S., and the
Debtors expect the Court will approve that request in the next day
or two.
With respect to goods and services received before the filing date
the Chapter 11 Debtors are seeking authorization from the Court to
pay certain prepetition claims of essential suppliers in the
ordinary course if those suppliers agree to payment terms that are
acceptable to TKH.
In addition to its balance and cash from operations, Takata is
working with the Customer Group on an agreement to provide Takata
with valuable accommodations and liquidity enhancements to finance
the restructuring. These proposed accommodations would be in the
form of waivers of setoff rights, acceleration of payments to
Takata, and resourcing limitations. Upon approval by the Court, the
accommodations and additional liquidity support, along with
Takata's cash flow from operations are expected to enable Takata to
continue to operate our business and serve automotive customers
globally in the ordinary course and without any significant
disruptions.
The deadline for filing a proof of claim has not yet been set. Once
a deadline is set, creditors will receive notice of the deadline
and instructions about how to file a proof of claim.
The Company said that the Chapter 11 filing in the U.S. and
proposed sale to KSS should have no effect on the ability of
drivers to get replacements for recalled Takata airbag inflators
free of charge. Vehicle owners should respond to the recall notice
that they received or vehicle owners in the U.S. can visit
https://www.airbagrecall.com/ for more information on airbag
inflator replacements.
About Takata Corp
Japan-based Takata Corporation (TYO:7312) --
http://www.takata.com/en/-- develops, manufactures and sells
safety products for automobiles. The Company offers seatbelts,
airbags, steering wheels, child seats and trim parts.
Headquartered in Tokyo, Japan, Takata operates 56 plants in 20
countries with approximately 46,000 global employees worldwide.
The Company has subsidiaries located in Japan, the United States,
Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea,
China and other countries.
In May 1995, a voluntary recall in the U.S. affecting 8 million
predominantly Japanese built vehicles made from 1986 to 1991 with
seat belts manufactured by the Takata was conducted. Large recalls
of vehicles due to faulty Takata-made airbags then began in 2013.
Takata is facing massive costs of recalling 100 million defective
airbag inflators worldwide and lawsuits tied to at least 16 deaths
and numerous injuries.
As of May 19, 2015, Takata has already recalled 40 million
vehicles across 12 vehicle brands for defective airbags.
In November 2015, Takata was fined $200 million by U.S. federal
regulators for mishandling the way it recalled its air bag
inflators. The fine is the largest civil penalty in NHTSA
history.
After reaching a deal to sell all its global assets and operations
to Key Safety Systems (KSS) for US$1.588 billion, Takata and its
Japanese subsidiaries commenced proceedings under the Civil
Rehabilitation Act in Japan in the Tokyo District Court (the "Tokyo
Court") on June 25, 2017.
In addition, on June 25, 2017, Takata's main U.S. subsidiary TK
Holdings Inc. and eleven of its U.S. and Mexican affiliates each
filed voluntary petitions under Chapter 11 of the Bankruptcy Code
in the United States Bankruptcy Court for the District of Delaware.
The Debtors have requested that their cases be jointly
administered under Case No. 17-11375.
Nagashima Ohno & Tsunematsu is the counsel in the Japanese
proceedings. Weil, Gotshal & Manges LLP and Richards, Layton &
Finger, P.A., are serving as counsel in the U.S. cases.
PricewaterhouseCoopers is serving as financial advisor, and Lazard
is serving as investment banker to Takata. Ernst & Young LLP is
tax advisor.
Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal
counsel, KPMG is serving as financial advisor, Jefferies LLC is
acting as lead financial advisor while UBS Investment Bank also
provides financial advice to KSS.
Prime Clerk is the claims and noticing agent and maintains the case
Web site http://www.takata.com/
TALOS ENERGY: S&P Withdraws 'SD' Corporate Credit Rating
--------------------------------------------------------
S&P Global Ratings said its ratings on Talos Energy LLC remain
unchanged and then withdrew the ratings, including the 'SD'
(selective default) corporate credit rating, at the company's
request.
TERRENO REALTY: Fitch Assigns BB Preferred Stock Rating
-------------------------------------------------------
Fitch Ratings has assigned a 'BBB-' rating to the private placement
offering issued by Terreno Realty LLC, the operating partnership of
Terreno Realty Corp (NYSE: TRNO). The offering consists of $100
million of unsecured notes due 2024 that will bear interest at
3.75%. The transaction is anticipated to close on or around July
14, 2017. As part of the use of proceeds, the company intends to
redeem all of its 7.75% Series A Cumulative Preferred Stock on July
19, 2017.
KEY RATING DRIVERS
Fitch's ratings take into account TRNO's portfolio concentration in
strong markets, transparent industrial property-focused business
model, experienced management, and credit metrics that are
moderately strong for the rating. The potential for greater cash
flow volatility stemming from market, asset and tenant
concentration risk and possible missteps surrounding the company's
value-added acquisition-led growth strategy balance these credit
positives. Also, the company has a less developed and shorter track
record as an unsecured borrower.
The Stable Outlook reflects Fitch's expectation that TRNO will
maintain credit metrics that are consistent with the 'BBB-' rating
over the two-year Outlook horizon, as well as Fitch's view of near-
to medium-term industrial property fundamentals.
Portfolio Concentrated in Strong Markets: Fitch expects TRNO's
portfolio market fundamentals to outperform the U.S. average over
the near- to medium-term, based on its superior demographics and
barriers to new supply. The company's portfolio is located in six
of the strongest U.S. industrial markets, characterized by vibrant
and growing local and regional economies, favorable population and
income demographics and meaningful barriers to new supply.
The above-average occupancies and rents in Terreno's markets
highlight these strong fundamentals relative to the total U.S.
industrial property base. Institutional investor and lender
interest in TRNO's assets is likely above its peer average given
the desirable market locations, thus supporting the company's
contingent liquidity position.
Transparent Operating Strategy: Terreno's transparent, well-defined
operating strategy is a credit positive. The company targets 100%
fee simple ownership of industrial assets in six key logistics
markets that include Northern NJ/NY (23.7% of annualized base rent
[ABR]), D.C./Baltimore (23.2%), Los Angeles (14.4%), Miami (13.9%),
San Francisco (13.5%) and Seattle (11.3%).
TRNO's strategy does not contemplate investments in ground-up
development or unconsolidated joint venture partnerships (JVs). The
absence of these items helps simplify the company's business model,
improve financial reporting transparency and reduce potential
contingent liquidity claims.
Fitch's ratings for TRNO include some flexibility for selective
ground-up development at existing owned in-fill properties, as well
as a limited amount of JVs if, for example, only a partial interest
in an attractive industrial portfolio in its markets was available
for purchase.
Appropriate Credit Metrics: Fitch expects TRNO's leverage to
sustain within a range of 6.0x-6.5x through 2019, on an adjusted
basis that includes a full-year's contribution from external
investment activity. TRNO's leverage was 5.2x for the TTM ending
March 31, 2017, which is appropriate for the 'BBB-' rating. The
company's leverage was 5.6x including 50% equity credit for its
perpetual preferred stock in total debt.
Fitch expects the company's fixed-charge coverage (FCC) to improve
moderately over the Rating Outlook horizon as the company
stabilizes value-add acquisitions and achieves better leverage of
its fixed costs as total assets grow. Fitch expects the company's
FCC will be in the mid-3.0x range through 2019.
The company has publicly committed to financial policies through
the cycle that are consistent to moderately strong for a 'BBB-'
rated REIT with TRNO's asset profile. These include maintaining
leverage below 6.5x and FCC above 2.0x. The company's dividend
policy is to pay 100% of its taxable net income to its equity
holders. Fitch expects TRNO's dividend payout ratio of AFFO to
range between the mid-80% to mid-90% level over the rating horizon,
excluding stabilization capex related to value-add acquisitions.
Experienced Management: TRNO has a strong management team with
extensive industrial real estate and capital markets experience.
Many of the company's key executives previously held high-level
executive positions at AMB Property prior to its merger with
ProLogis.
Portfolio Market and Tenant Concentration: Fitch expects the
portfolio's asset and tenant granularity to improve as TRNO
executes on its value-add acquisition-led growth strategy. However,
Fitch does not expects the company to expand beyond its six major
markets. TRNO's concentrated portfolio strategy exposes it to
idiosyncratic market and asset risks and could result in
above-average property income volatility. Examples could include a
regional economic downturn or loss of a significant tenant.
The company's small size and concentration in markets with higher
per square foot industrial values relative to its peers has
contributed to its below-average asset granularity. However, the
multiple-building nature of many of its larger assets as well as
their infill locations helps to offset the asset concentration
risk.
Two markets - Northern NJ/NY and D.C./Baltimore - comprised 46.9%
of the company's ABR as of March 31, 2017. Moreover, its 10 largest
properties (at cost) accounted for roughly 35% of its total
investment in real estate.
TRNO's top-20 tenants comprised 37.8% of ABR at March 31, 2017,
which is more concentrated than the industrial REIT peer median of
slightly more than 20%. Moreover, the company's largest tenant
(FedEx Corp.) was 5.7% of its ABR versus a comparable peer median
top tenant exposure of approximately 2%. Fitch views the company's
portfolio tenant concentration as a credit risk that could lead to
greater cash flow volatility. However, the generally strong credit
quality of its largest tenants and multiple leases with several of
these tenants help balance the concentration risk.
Execution Risk in Value-Add Acquisitions: TRNO's external growth
strategy centers on the acquisition and stabilization of industrial
assets, primarily through some combination of lease-up and property
redevelopment. Fitch generally views the value-add strategy as
being in between "core" investments and ground-up development in
risk/return space. Value-add acquisitions can entail additional
risk given less familiarity with an asset compared to the
repositioning of existing owned assets. However, Fitch views TRNO
management's extensive industrial property experience and the small
dollar value and homogeneity of industrial assets as risk
mitigants. The company has improved its portfolio occupancy to
97.4% at 1Q17 from 90.7% at 1Q16, demonstrating its ability to
successfully stabilize value-add acquisitions.
Improving Unsecured Capital Access: Fitch continues to view TRNO as
a less established unsecured bond issuer. However, this transaction
improves TRNO's demonstration of its added financial flexibility;
it has now raised $250 million of private placement unsecured notes
since September 2015. This repeated, ongoing access to private
placement unsecured notes is an important milestone in the
company's transition to a predominantly unsecured borrowing
strategy.
Preferred Stock Notching: The two-notch differential between TRNO's
Issuer Default Rating (IDR) and preferred stock rating is
consistent with Fitch's criteria for corporate entities with a
'BBB-' IDR. These preferred securities are deeply subordinated and
have loss absorption elements that would likely result in poor
recoveries in the event of a corporate default. Upon the expected
closing of the notes offering on July 14, 2017, the company intends
to redeem all of its 7.75% Series A preferred stock on July 19,
2017, at which point the company will not have any preferred stock
outstanding
DERIVATION SUMMARY
TRNO's ratings reflect the issuer's strong portfolio of industrial
real estate in the top U.S. markets with a solid management team
and leverage that is relatively low for the rating category. The
company should experience outsized growth in the next few years and
has a rather simple business model with minimal exposure to
development risk. These strengths are partially offset by lower FCC
and higher dividend payout ratio than its peers as well as a
smaller size and scale, which provides less overall granularity and
diversification in comparison to the other larger industrial
REITs.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for TRNO include:
-- GAAP SSNOI growth in the 4% to 5% range through the 2018
projection period;
-- Net acquisitions of roughly $200 million to $300 million
through 2018;
-- Annual unsecured issuance of between $50 million and $150
million;
-- Equity issuance of $100 million to $150 million per annum;
-- The company unencumbers assets as mortgages mature with the
proceeds from new unsecured debt and equity raises.
RATING SENSITIVITIES
The following factors may have a positive impact on the ratings
and/or Rating Outlook:
-- TRNO's demonstrated adherence to its financial policies during
through the cycle given its value-add acquisition strategy,
which could result in greater relative cash flow volatility;
-- Fitch's expectation of leverage sustaining in the low 6.0x
range (leverage was 5.2x for the TTM ended March 31, 2017);
-- Fitch's expectation of FCC sustaining above 3.0x;
-- Increased asset and tenant level diversification within the
company's concentrated, six-market portfolio;
-- Further demonstrated access to the unsecured bond market.
The following factors may have a negative impact on the ratings
and/or Rating Outlook:
-- Fitch's expectation of leverage sustaining above 7.0x;
-- Fitch's expectation of FCC sustaining below 2.0x.
LIQUIDITY
TRNO's sources of capital cover its uses by 1.9x for the April 1,
2017 to Dec. 31, 2018 period under Fitch's base case liquidity
analysis after adjusting for events subsequent to quarter-end,
including $100 million of private placement unsecured notes, $46
million of preferred stock redemption and $25.3 million of
contracted dispositions, which was offset by $51.3 million of
completed acquisitions. This includes $16 million drawn on the
company's $200 million revolver, cash on hand, and a modest amount
of retained cash flow after dividends as the company's primary
sources of liquidity.
Although near-term maturities are modest, the company's debt ladder
has elevated maturities in the 2020s, consisting of term loans and
unsecured borrowings. Fitch expects the company to refinance the
2021 term loan ahead of its stated maturity, most likely with
proceeds from new unsecured private placement notes. TRNO's
longer-dated maturities should decline as a percentage of total
debt as the company executes its value-add acquisition growth
strategy.
TRNO's unencumbered assets cover its unsecured debt (UA/UD) by 2.4x
using a direct capitalization approach of TRNO's annualized 1Q17
unencumbered net operating income (NOI) that assumes a stressed
8.75% through-the-cycle cap rate. Fitch expects the company's UA/UD
to moderate to the low- to mid-2x range as it progresses in its
unsecured borrowing strategy, which would remain appropriate for
the 'BBB-' rating.
FULL LIST OF RATING ACTIONS
Fitch rates TRNO:
Terreno Realty Corporation
-- Issuer Default Rating (IDR) 'BBB-';
-- Preferred Stock 'BB'.
Terreno Realty LLC
-- IDR 'BBB-';
-- Senior unsecured revolving line of credit 'BBB-';
-- Senior unsecured term loan 'BBB-';
-- Senior unsecured private placement notes 'BBB-'.
The Rating Outlook is Stable.
TRAMMELL FAMILY LAKE: Plan Filing Deadline Moved to Aug. 31
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Alabama has
extended, at the behest of Trammell Family Lake Martin Properties,
LLC, and Trammell Family Orange Beach Properties, LLC, the Debtors'
exclusive period to file a Chapter 11 plan through Aug. 31, 2017.
As reported by the Troubled Company Reporter on May 29, 2017, the
Debtors are defendants in litigation in the U.S. District Court for
the Southern District of Alabama, entitled: SE Property Holdings,
LLC v. Center, case number 15-cv-00033 (S.D. Ala.). The Debtors
relate that in this litigation, creditor SE Property Holdings, LLC,
asserts that substantially all of the Debtors' assets have been
fraudulently transferred to the Debtors, and seeks to unwind the
transfers to divest the Debtors of their property. The Debtors
anticipate that the Southern District Court will need at least 30
days after it receives the post-trial briefs to issue a conclusive
ruling due to the complexity of the fraudulent conveyance
litigation and the amount of evidence at issue.
About Trammell Family Lake Martin
Trammell Family Lake Martin, LLC, sought protection under Chapter
11 of the Bankruptcy Code (Bankr. M.D. Ala. Case No. 17-30260) on
Jan. 30, 2017. The petition was signed by Amy Brown, manager. The
case is assigned to Judge William R. Sawyer. At the time of the
filing, the Debtor estimated assets of $1 million to $10 million
and liabilities of less than $500,000.
The Debtor is represented by Lee R. Benton, Esq., and Samuel C.
Stephens, Esq., at Benton & Centeno, LLP.
TRANSGENOMIC INC: Gives Financials for New Precipio Listing
-----------------------------------------------------------
As previously reported on Oct. 13, 2016, Transgenomic, Inc., New
Haven Labs Inc., a wholly-owned subsidiary of the Company, and
Precipio Diagnostics, LLC entered into an Agreement and Plan of
Merger pursuant to which Precipio will become a wholly-owned
subsidiary of the Company, on the terms and subject to the
conditions set forth in the Merger Agreement. Following the
Merger, Transgenomic will change its name to Precipio, Inc.
On June 20, 2017, the Company provided Nasdaq with certain
requested financial information as part of Nasdaq's review of the
Company's previously filed initial listing application with respect
to the New Precipio common stock.
According to the unaudited pro forma condensed combined balance
sheet, New Precipio had $39.68 million in total assets, $26.78
million in total liabilities and $12.90 million in total
stockholders' equity.
New Precipio reported a net loss from continuing operations
available to common stockholders of $3.19 million on $907,000 of
net sales for the three months ended March 31, 2017.
The unaudited pro forma condensed combined financial statement is
available for free at https://is.gd/ZkYbtn
About Transgenomic
Transgenomic, Inc. -- http://www.transgenomic.com/-- is a global
biotechnology company advancing personalized medicine in oncology
and inherited diseases through advanced diagnostic technologies,
such as its revolutionary ICE COLD-PCR, which enables use of liquid
biopsies for mutation detection. The company also provides
specialized clinical and research services to biopharmaceutical
companies developing targeted therapies. Transgenomic's diagnostic
technologies are designed to improve medical diagnoses and patient
outcomes.
Transgenomic reported a net loss available to common stockholders
of $8 million on $1.55 million of net sales for the year ended Dec.
31, 2016, compared with a net loss available to common stockholders
of $34.27 million on $1.92 million of net sales for the year ended
Dec. 31, 2015. As of March 31, 2017, Transgenomic had $1.22
million in total assets, $21.87 million in total liabilities and a
total stockholders' deficit of $20.64 million.
Marcum LLP, in Hartford, CT, issued a "going concern" qualification
on the consolidated financial statements for the year ended Dec.
31, 2016, stating that the Company has incurred operating losses
and used cash for operating activities for the past several years.
This raises substantial doubt about the Company's ability to
continue as a going concern.
US RENAL: Moody's Lowers Corporate Family Rating to B3
------------------------------------------------------
Moody's Investors Service downgraded the ratings of U.S. Renal
Care, Inc. including its Corporate Family Rating to B3 from B2 and
its Probability of Default Rating to B3-PD from B2-PD. Moody's also
downgraded U.S. Renal's senior secured first lien credit facilities
to B2 from B1, and its senior secured second lien credit facility
to Caa2 from Caa1. The outlook is stable.
The downgrade reflects weak operating performance and Moody's
belief that U.S. Renal will be unable to meaningfully reduce its
financial leverage over the near-to-intermediate term. Moody's
anticipates that U.S. Renal will face near-term operational
headwinds due to rising clinic costs, commercial pricing pressures,
and a mix shift towards government payors, which will limit
earnings and cash flow growth.
Ratings Downgraded:
U.S. Renal Care, Inc.
Corporate Family Rating to B3 from B2
Probability of Default Rating to B3-PD from B2-PD
Senior secured first lien revolving credit facility expiring 2020
to B2 (LGD 3) from B1 (LGD 3)
Senior secured first lien term loan due 2022 to B2 (LGD 3) from B1
(LGD 3)
Senior secured second lien term loan due 2023 to Caa2 (LGD 6) from
Caa1 (LGD 6)
The outlook is stable.
RATINGS RATIONALE
The B3 CFR reflects the company's very high financial leverage and
aggressive new clinic opening strategy. Moody's also incorporates
the company's weak operating trends relating specifically to its
clinic level earnings into the CFR. The rating also reflects U.S.
Renal's relatively modest scale compared to its two largest
competitors, and Moody's expectation that the company will use
internally-generated cash to fund the development of new clinics.
Finally, the rating reflects the company's sole focus on the
dialysis services marketplace and its high concentration of
revenues from government based programs.
The rating benefits from favorable long-term demographics
characterized by increasing incidences of end stage renal disease
and the medical necessity of the service provided. Further, the
rating also reflects the company's strong, albeit declining profit
margins, which are better than those of other dialysis providers
rated by Moody's.
The stable outlook reflects Moody's expectation that U.S. Renal's
credit metrics will be challenged in the near-term by shifts in
payor mix and reimbursement pressure and elevated clinic costs. It
also reflects Moody's belief that the company will continue to
acquire existing clinics and open new ones to mitigate the earnings
impact of the aforementioned headwinds.
The ratings could be upgraded if U.S Renal is able to sustain
adjusted debt to EBITDA below 6.5 times while solidifying its
operating performance.
The ratings could also be downgraded if changes in the
reimbursement rate environment precipitate a profit decline, or if
acquisitions or shareholder friendly initiatives further weaken the
company's credit metrics. The ratings could also be downgraded if
U.S. Renal's liquidity deteriorates.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
U.S. Renal Care, Inc. provides dialysis services to patients who
suffer from chronic kidney failure. U.S. Renal provides dialysis
services through 321 outpatient facilities in 31 states and the
Territory of Guam, along with acute dialysis services through
contractual relationships with hospitals and home dialysis
services. Revenues are around $1.2 billion. The company is
primarily owned by private equity sponsors Leonard Green &
Partners, L.P., Frazier Healthcare, New Enterprise Associates,
Cressey & Company, and SV Life Sciences, and by some of U.S.
Renal's executives.
VANITY SHOP: Taps Diamond B Technology as IT Consultant
-------------------------------------------------------
Vanity Shop of Grand Forks, Inc. seeks authority from the United
States Bankruptcy Court for the District of North Dakota to employ
Diamond B Technology Solutions, LLP as its consultant for the
purpose of providing Hilco IP Services d/b/a Hilco Streambank with
information technology services in support of the Debtor's efforts
to sell its Intellectual Property assets.
DBTS would assist Hilco Streambank by creating a virtual data room
and uploading content from the Debtor's existing databases as
requested by Hilco Streambank. DBTS's anticipated services may also
include gathering the Debtor’s customer lists, customer
segmentation, data aggregation, social media accounts, rewards,
ecommerce and trademark information.
Scott Roller, Vice-President of Technology for Diamond B Technology
Solutions, LLC, attests that neither he nor his firm will hold or
represent any interest adverse to the interest of the Debtor or the
estate.
DBTS bills its services to clients on a time and materials basis.
DBTS published rates are:
Data Analysis/Consulting $185/hr
Software Development $165/hr
Project Management $150/hr
IT Support $150/hr
Project Discovery $150/hr
Travel time $95/hr
Training $85/hr
On-site training $185/hr - $1500/day
Onsite Hardware installation $165/hr
Network Design/Analysis $185/hr
Data Center Support $100/hr
Operations management center staff $35/hr
Operations management center manager $65/hr
The Consultant can be reached through:
Scott Roller
Diamond B Technology Solutions, LLC
4201 38th St. S., Suite 208
Fargo, ND 58104
Tel: 701-212-4795
Mobile: 701-219-9461
Email: scott@diamonbts.com
About Vanity Shop of Grand Forks
Based in Fargo, North Dakota, Vanity Shop of Grand Forks, Inc.
filed a Chapter 11 petition (Bankr. D. N.Dak. Case No. 17-30112) on
March 1, 2017. The petition was signed by James Bennett, chairman
of the Board of Directors. In its petition, the Debtor estimated
assets of less than $100,000 and liabilities of $10 million to $50
million.
Judge Shon Hastings presides over the case. Caren Stanley, Esq.,
at Vogel Law Firm, serves as the Debtor's bankruptcy counsel. The
Debtor hired Eide Bailly, LLP as auditor; Bell Bank as trustee for
the ERISA Plan; and Jill Motschenbacher as accountant.
On March 10, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee hired Fox
Rothschild LLP as bankruptcy counsel, BGA Management, LLC, as
financial advisor, and Brady Martz & Associates PC, as accountant.
VENCORE INC: S&P Puts 'B' CCR on CreditWatch Positive
-----------------------------------------------------
S&P Global Ratings placed all of its ratings on Vencore Inc.,
including S&P's 'B' corporate credit rating, on CreditWatch with
positive implications.
The CreditWatch positive placement follows Vencore's recent
announcement that its parent, Vencore Holding Corp., intends to
issue an IPO and use the proceeds to reduce its debt. According to
the SEC filing, Vencore's equity sponsor, Veritas Capital, will not
be selling any of its shares in connection with the IPO and will
remain the controlling shareholder with over 50% ownership. The
company did not state exactly what level of proceeds it expects to
receive from the IPO, although a notional $250 million sale was
indicated in the SEC filing. If the company is able to reduce its
debt by at least $250 million as part of this transaction, its
debt-to-EBITDA metric would likely decline to around 5.0x from 6.9x
as of the 12 months ended March 31, 2017. Because S&P believes that
this IPO is Veritas' first step toward exiting its ownership of the
company, S&P do not view a re-leveraging event as likely after the
IPO is completed.
S&P intends to resolve the CreditWatch placement if the IPO closes
or if it seems unlikely that it will be executed. The extent of
the potential upgrade depends on the magnitude of the company's
debt repayment and management's commitment to maintaining a lower
level of leverage, with a one-notch upgrade likely if its
debt-to-EBITDA falls below 5x.
Although less likely, S&P could raise its rating on the company by
two notches if its debt-to-EBITDA declines to around 4x and
management commits to maintain this reduced level of leverage. In
addition, there could be multi-notch issue-level upgrades based on
the raised corporate credit rating, as well as potentially improved
recovery prospects depending on the proportion of first- and
second-lien debt that the company pays down with its IPO proceeds.
VINCE LLC: Moody's Cuts CFR to Caa2 & Revises Outlook to Negative
-----------------------------------------------------------------
Moody's Investors Service downgraded Vince, LLC's, Corporate Family
Rating (CFR) to Caa2 from Caa1 and Probability of Default Rating to
Caa2-PD from Caa1-PD. The Caa2 rating on the company's senior
secured first lien term loan due 2019 and SGL-4 Speculative Grade
Liquidity Rating were affirmed. The outlook was changed to
negative.
"The downgrade and negative outlook reflect ongoing weak operating
performance in the business and a worsened liquidity profile, that
is highlighted by negative free cash flow, greater reliance on the
company's ABL facility, and an expectation that Vince's term loan
credit agreement will need to be amended over the near term in
order to avoid an event of default," said Moody's Assistant Vice
President and lead analyst Dan Altieri.
Over the LTM period ended April 29, 2017, Vince has seen revenue
declines in the mid-teens percentage range, with Moody's adjusted
EBITDA lower by around $25 million (before accounting for operating
leases), which has resulted in the company breaching the net
leverage ratio test in its term loan credit agreement in the last
two fiscal quarters. Vince has since made two specified equity
contributions for the fourth quarter of 2016 and first quarter of
2017 totaling around $18 million to cure the violations and keep
the company in compliance. However these payments have
substantially reduced the company's balance sheet cash as the
proceeds from the equity contribution were used to repay borrowings
outstanding under the revolver. In addition, negative free cash
flow of around $30 million over the LTM period has resulted in
greater reliance on the company's $80 million asset-based revolving
credit facility ($70 million loan cap) due 2020. As of April 29,
2017, there was about $21 million was drawn on the company's ABL
facility with approximately $15 million available for borrowing,
versus only $5 million outstanding at year end 2016 and with $27
million available for borrowing.
The SGL-4 liquidity rating further reflects Moody's expectation
that operating performance over the next few quarters will not
improve enough to remain compliant with the net leverage ratio test
in the company's term loan credit agreement. Barring an amendment
to the facility, Moody's expects Vince will breach the covenant
which after the applicable grace period would result in an event of
default. (Vince's credit agreement prohibits no more than two
equity cures in any four quarter period.) The ABL facility also
contains a springing minimum EBITDA covenant ($20 million) which
was temporarily modified to be tested if availability falls below
the greater of 12.5% of the loan cap or $5 million (from 15% or $10
million), giving the company a little more availability on the
facility before triggering the test. Compliance with this test is
also less certain given Moody's expectation for continued reliance
on the facility and a potentially lower borrowing base as a result
of the lower cash balance (cash is temporarily permitted to be
included in the borrowing base calculation).
Moody's notes that Vince has received a rights offering commitment
letter from Sun Capital Partners V, L.P. ("Sun Capital"), the
company's majority shareholder, for $30 million which requires
among other things the company enter into an amendment to its term
loan agreement that is acceptable to Sun Capital. If Vince is able
to meet the terms of the rights offering and receive $30 million of
cash proceeds, it would improve the company's near term liquidity
profile. However, over the longer term the company still needs to
address ongoing declines in the business.
The negative outlook reflects Moody's expectation that the company
will be challenged to reverse recent operating trends in a
difficult retail environment, which would likely result in further
negative rating actions. If the company can improve its liquidity
profile, including addressing potential near term covenant
violations, improving its cash position, and stabilizing negative
free cash flow trends, the outlook could be changed to stable.
Moody's took the following rating actions:
Issuer: Vince, LLC
Corporate Family Rating, Downgraded to Caa2 from Caa1
Probability of Default Rating, Downgraded to Caa2-PD from Caa1-PD
$175 million ($45 million outstanding) Sr. Secured 1st Lien Term
Loan due 2019, Affirmed at Caa2 (LGD4)
Speculative Grade Liquidity Rating, Affirmed SGL-4
Outlook, changed to Negative
RATINGS RATIONALE
Vince's Caa2 CFR reflects the company's very weak liquidity profile
and credit metrics, as well as Moody's expectation that the company
will require an amendment to its term loan credit agreement in
order to avoid an event of default. The rating also reflects
Vince's limited scale and high product concentration in premium
priced women's apparel, a segment that appeals to a limited number
of consumers and that is subject to very high fashion risk and
fluctuating consumer tastes which are factors that have led to
ongoing weak operating performance. The company's relatively
limited track record with the brand having been established in
2002, as well has high distribution concentration at luxury
department stores also constrains the rating. The three largest
customers (Nordstrom, Saks Fifth Avenue and Neiman Marcus)
represented 45% of total revenue in fiscal 2016. The rating is
supported by Vince's modest amount of debt (only $45 million
outstanding on the term loan and $21 million outstanding on the
revolver as of April 29, 2017) which provides the company with some
flexibility as it works through its current operational and capital
structure challenges.
The affirmation of the Caa2 rating on the company's first lien term
loan reflects its modest size in the capital structure, with only
$45 million remaining outstanding, relative to the size of Vince's
operating lease commitments and accounts payable remainder. It also
acknowledges that Moody's believes there is enough value in the
Vince brand name which would support a recovery in line with the
Caa2 rating. The term loan is ranked below the company's $80
million ABL facility, which has a priority position in the capital
structure, and is secured by a second lien position on the more
liquid assets (accounts receivable and inventory) behind the ABL
facility. The term loan has a first lien on essentially all other
domestic assets (the primary value attributed to the Vince brand
name).
Ratings could be downgraded if the company is unable to resolve its
current liquidity constraints, including its modest cash balance
and the likely violation of its financial maintenance covenant,
resulting in a heightened risk of default. A downgrade would also
be likely if recent operating trends including lower revenue and
EBITDA, and negative free cash flow continue. The rating on the
term loan could also be downgraded should Vince take actions that
would weaken the term loan lenders priority claim on the Vince
brand name.
An upgrade would require sustained improvement in the business
including topline and EBITDA growth, as well as an improved
liquidity profile including positive free cash flow, and an
expectation that the company will remain compliant with its credit
agreements.
The principal methodology used in these ratings was Global Apparel
Companies published in May 2013.
Vince, LLC designs, manufactures and markets apparel for women and
men under the "Vince" brand. The company's products are sold
globally in luxury department stores such as Neiman Marcus,
Nordstrom, Saks Fifth Avenue and Harrods, as well as in the
company's branded retail stores and on its ecommerce website. As of
April 29, 2017 the company operated 54 stores in the United States
and generated LTM revenue of approximately $259 million.
VRG LIQUIDATING: Exclusive Plan Filing Period Extended to Oct. 18
-----------------------------------------------------------------
The Hon. Laurie Selber Silverstein of the U.S. Bankruptcy Court for
the District of Delaware has extended, at the behest of VRG
Liquidating, LLC, et al., the periods within which the Debtors have
the exclusive right to file a Chapter 11 plan of liquidation and
solicit acceptances for the plan through and including Oct. 18,
2017, and Dec. 18, 2017, respectively.
As reported by the Troubled Company Reporter on June 9, 2017, the
Debtors ask the Court for extension, saying that they require
additional time to complete their analysis of these claims and,
where appropriate, to object to these claims. The Debtors submit
that the complexity and relatively short duration of these cases
warrants the extension of the Exclusive Periods. While the Debtors
have already made significant progress by preparing the Plan and
Disclosure Statement, before proceeding with an amended Plan and
Disclosure Statement the Debtors need to complete their analysis
and reconciliation of the administrative expense claims and
priority claims that have been filed to date and, where
appropriate, to object to those claims. The extent to which these
claims are allowed or disallowed at the conclusion of this process
may necessitate further revisions to the Plan and Disclosure
Statement.
About VRG Liquidating, LLC
Vestis Retail Group and eight of its affiliates filed Chapter 11
bankruptcy petitions (Bankr. D. Del. Lead Case No. 16-10971) on
April 18, 2016. The Debtors estimated assets in the range of $0 to
$50,000 and debts of $100 million to $500 million. The petitions
were signed by Thomas A. Kennedy as secretary.
Headquartered in Meriden, Connecticut, Vestis Retail Group, LLC, et
al., operate 144 retail stores, which are located in 15 states.
Bob's Stores operates 36 stores throughout New England, New York,
and New Jersey. Eastern Mountain Sports operates 61 stores,
located primarily in the Northeastern states. Sport Chalet
operates 47 stores throughout California, Arizona, and Nevada.
Bob's Stores and EMS primarily operate stores located in the
Northeastern states, while Sport Chalet's stores, which are
currently being liquidated, are located in the Western states.
Prior to the Petition Date, each of the three Debtor retailers
operated an e-commerce site at, respectively, www.bobstores.com,
www.sportchalet.com, and www.ems.com. In 2015, the Debtors
collectively generated 5% of their total sales, or approximately
$32 million, through e-commerce, according to Court documents.
Judge Laurie Selber Silverstein is assigned to the cases.
The Debtors have hired Young, Conaway, Stargatt & Taylor, LLP, as
their counsel, FTI Consulting, Inc. and Lincoln Partners Advisors
LLC as their financial advisor and Kurtzman Carson Consultants,
LLC, as their claims and noticing agent, KPMG LLP as tax compliance
and consulting service provider.
An official committee of unsecured creditors has been appointed in
the cases. The Committee has tapped Cooley LLP as its lead counsel
and Polsinelli as conflicts counsel. Zolfo Cooper, LLC, serves as
its bankruptcy consultant and financial advisor.
WALTER INVESTMENT: Bank Debt Trades at 8% Off
---------------------------------------------
Participations in a syndicated loan under Walter Investment
Management Corp is a borrower traded in the secondary market at
91.95 cents-on-the-dollar during the week ended Friday, June 16,
2017, according to data compiled by LSTA/Thomson Reuters MTM
Pricing. This represents an increase of 0.80 percentage points
from the previous week. Walter Investment pays 375 basis points
above LIBOR to borrow under the $1.5 billion facility. The bank
loan matures on Dec. 18, 2020 and carries Moody's Caa1 rating and
Standard & Poor's CCC rating. The loan is one of the biggest
gainers and losers among 247 widely quoted syndicated loans with
five or more bids in secondary trading for the week ended June 16.
WEATHERFORD INTERNATIONAL: Deregisters Unissued Ordinary Shares
---------------------------------------------------------------
Weatherford International PLC filed with the Securities and
Exchange Commission post-effective amendments relating to the
following Registration Statements on Form S-8 filed by the Company
with the SEC:
* Registration Statement (Form S-8 No. 333-13531), as amended,
pertaining to, among other things, the registration of
1,000,000 ordinary shares of the Company, par value $0.001
per share, to be delivered under the Weatherford
International, Inc. Foreign Executive Deferred Compensation
Stock Plan;
* Registration Statement (Form S-8 No. 333-112378), as
amended, pertaining to (i) the registration of 200,000
Ordinary Shares to be delivered under the Foreign Executive
Plan, (ii) the registration of 3,000,000 Ordinary Shares to
be delivered under the Weatherford International, LLC 401(k)
Savings Plan and (iii) the registration of 150,000 Ordinary
Shares to be delivered under the Weatherford International
Ltd. Deferred Compensation Plan for Non-Employee Directors,
as amended;
* Registration Statement (Form S-8 No. 333-81676), as amended,
pertaining to, among other things, the registration of an
aggregate of 360,000 Ordinary Shares to be delivered under
the Stock Option Agreements Dated Sept. 26, 2001, with Non-
Employee Directors; and
* Registration Statement (Form S-8 No. 333-36598), as amended,
pertaining to, among other things, the registration of
3,000,000 Ordinary Shares to be delivered under the 401(k)
Plan.
On Jan. 1, 2016, the Company removed its Ordinary Shares as an
investment option under the 401(k) Plan. All benefits under (i)
the Foreign Executive Plan and (ii) the Non-Employee Directors Plan
were distributed on Jan. 3, 2017, in accordance with the terms of
the respective plan and these plans are no longer in effect. The
Stock Option Agreements have all expired pursuant to their terms.
In accordance with an undertaking made by the Company in the
Registration Statements to remove from registration, by means of a
post-effective amendment, any of the securities that had been
registered for issuance that remain unsold at the termination of
such offering, the Company hereby files these Post-Effective
Amendments to the Registration Statements in order to deregister
all Ordinary Shares that were registered under the Registration
Statements and remain unissued under the Foreign Executive Plan,
the 401(k) Plan, the Non-Employee Directors Plan and the Stock
Option Agreements.
About Weatherford
Ireland-based Weatherford International plc (NYSE: WFT) --
http://www.weatherford.com/-- is one of the largest multinational
oilfield service companies providing innovative solutions,
technology and services to the oil and gas industry. The Company
operates in over 100 countries and has a network of approximately
1,000 locations, including manufacturing, service, research and
development, and training facilities and employs approximately
31,000 people.
Weatherford International reported a net loss attributable to the
Company of $3.39 billion on $5.74 billion of total revenues for the
year ended Dec. 31, 2016, compared to a net loss attributable to
the Company of $1.98 billion on $9.43 billion of total revenues for
the year ended Dec. 31, 2015. As of March 31, 2017, Weatherford
had $12.16 billion in total assets, $10.47 billion in total
liabilities and $1.69 billion in total shareholders' equity.
* * *
In November 2016, Fitch Ratings has downgraded the ratings for
Weatherford and its subsidiaries, including the companies'
Long-Term Issuer Default Ratings (IDRs) to 'CCC' from 'B+'.
In November 2016, S&P Global Ratings lowered its corporate credit
rating on Weatherford International to 'B+' from 'BB-'. "The
downgrade reflects our revised free operating cash flow estimates
for Weatherford following weaker-than-anticipated cash inflows in
the third quarter," said S&P Global Ratings credit analyst Carin
Dehne-Kiley.
WERTHAN PACKAGING: Unsecureds To Recoup Up to 5% Under Plan
-----------------------------------------------------------
Werthan Packaging, Inc., and the Official Committee of Unsecured
Creditors filed with the U.S. Bankruptcy Court for the Middle
District of Tennessee a joint disclosure statement dated June 12,
2017, referring to the Chapter 11 plan for the Debtor.
Class 2 General Unsecured Claims -- estimated at $8 million -- are
impaired by the Plan. On the Distribution Date, each holder of an
Allowed General Unsecured Claim will receive its pro rata share of
the Estate assets remaining after payment of the Allowed
administrative and priority claims. Estimated percentage recovery
for the Class 2 Claimants is between 2% and 5%.
All assets to be distributed for the benefit of General Unsecured
Creditors will be held by the Debtor's bankruptcy estate, which
will continue in existence after confirmation of the Plan. The
agent will be appointed to manage the Estate's assets and
distributions to creditors. The value of the estate assets
(available for distribution to Claimants in Classes 2 and 3) could
be as much as $400,000, but the actual value may be lower,
depending on a number of factors that are impossible to predict.
This value has been determined based on the proceeds from the Sale
that remained after payment of the Debtor's secured debt. Those
proceeds were reduced by administrative expenses of the Debtor,
which included fees for Resurgence Financial Services, LLC, and the
Debtor's attorneys and the Committee's attorneys, through Jan. 31,
2017, or Feb. 28, 2017.
Although the Estate will initially consist of cash from the
Debtor's bank accounts that cash must first be used to pay
administrative expense claims, fee claims, and priority claims.
The cash will also be used to fund the ongoing expenses of the
Estate, which the Plan Proponents expect will be fairly nominal.
There can be no assurance that any of such cash will otherwise be
available for distribution to General Unsecured Creditors.
The Plan was designed to maximize the recoveries to creditors by
providing for the continuation of the bankruptcy estate with the
appointment of a Liquidating Agent to liquidate the assets of the
estate and distribute them to creditors according to the Plan. All
of the Debtor's property and the Estate's assets will remain with
the Estate after Confirmation to pay the Debtor's Allowed
Administrative Claims, Allowed Fee Claims and Allowed Priority
Claims in full. After paying those claims, the remainder of the
Debtor's property will be distributed pro rata to allowed unsecured
claims.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/tnmb16-08624-177.pdf
About Werthan Packaging
Werthan Packaging, Inc., based in White House, TN, is a supplier of
multiwall paper packaging for the pet food industry. Werthan
Packaging filed a Chapter 11 petition (Bankr. M.D. Tenn. Court Case
No. 16-08624), on Dec. 4, 2016. The Debtor is represented by Paul
G. Jennings, Esq., and Gene L. Humphreys, Esq., at Bass, Berry &
Sims PLC of Nashville, Tennessee. On Dec. 8, 2016, the Office of
the U.S. Trustee appointed an official committee of unsecured
creditors.
WHEATON LLC: Court Denies Confirmation of Reorganization Plan
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Maryland denied
approval of Wheaton LLC's Chapter 11 plan of reorganization and
disclosure statement.
The company's restructuring plan proposed to pay unsecured claims
in full over 24 months starting on the first day of the first full
month that is at least 30 days after the effective date of the
plan. Wheaton also proposed to fund the plan through contributions
from Paul Palitti, the company's sole member.
About Wheaton LLC
Wheaton LLC filed a Chapter 11 bankruptcy petition (Bankr. D.MD.
Case No. 17-11789) on February 10, 2017. Hon. Thomas J. Catloita
presides over the case. Drescher & Associates, P.A. represents the
Debtor as counsel.
The Debtor disclosed total assets of $1.5 million and total
liabilities of $936,689. The petition was signed by Paul Palitti,
sole member.
WJA ASSET: TD REO Fund et al. Tap RJI International CPAs as Auditor
-------------------------------------------------------------------
TD REO Fund, LLC, and TD Opportunity Fund, LLC, debtor-affiliates
of WJA Asset Management LLC, seek authority from the United States
Bankruptcy Court for the Central District of California, Sta Ana
Division, to employ RJI International CPAs, as auditors.
The Debtors seek to employ the Firm to complete the audits it
commenced earlier this year. The Firm estimates that the audit of
TD REO is approximately 98% completed and the TD Opportunity Fund
audit is approximately 25% completed. The Firm estimates that the
fees to complete the audit for TD REO will be approximately
$10,000.00 (in addition to the $6,825.00 in fees already incurred
post-petition) and for TD Opportunity Fund will be approximately
$20,000.00, after exhaustion of the pre-petition retainer.
The majority of the work will be performed by Gordon S. MacLean,
whose hourly rate is $375.00. However, the Firm reserves the right
to have other employees of the Firm perform work in this case, as
the Firm deems appropriate.
Gordon S. MacLean attests that his Firm does not represent an
individual or entity which holds an interest adverse to any of the
Debtors.
The Firm can be reached through:
Gordon S. MacLean
RJI INTERNATIONAL CPAs
18012 SkyPark Circle, Suite 200
Irvine, CA 92614
Tel: (949) 852-1600
Fax: (949) 852-1606
About WJA Asset Management
Founded in 2011, WJA Asset Management is a small organization in
the management services industry located in Laguna Hills,
California. WJA Asset and its affiliates are part of a network of
entities or "funds" formed to offer a range of investment
opportunities to clients.
The Debtors sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. C.D. Calif. Lead Case No. 17-11996) on May 18, 2017.
Howard Grobstein, chief restructuring officer, signed the
petitions.
At the time of the filing, WJA estimated assets of less than
$500,000 and liabilities of $1 million to $10 million.
Judge Scott C. Clarkson presides over the cases.
Lei Lei Wang Ekvall, Esq., Philip E. Strok, Esq., Robert S.
Marticello, Esq., and Michael L. Simon, Esq., at Smiley
Wang-Ekvall, LLP, serve as counsel to the Debtors.
WORLD OF WOOD: July 18 Plan Confirmation Hearing
------------------------------------------------
The Hon. Brian F. Kenney of the U.S. Bankruptcy Court for the
Eastern District of Virginia has approved World of Wood, Ltd.'s
second amended disclosure statement referring to the Debtor's plan
of reorganization.
A hearing to consider the confirmation of the Plan will be held on
July 18, 2017, at 1:30 p.m.
Objections to the plan confirmation must be filed by July 11,
2017.
Ballots must be returned to the counsel for the Debtor by July 11,
2017. The Counsel must file a Summary of Ballots by 5 p.m. on July
17, 2017.
As reported by the Troubled Company Reporter on June 9, 2017, the
Debtor filed with the Court a second amended disclosure statement
dated May 26, 2017, referring to its plan of reorganization. This
latest version of the Plan reflects the Debtor's obligation to the
U.S. Small Business Administration instead of Wells Fargo Bank.
The SBA is serviced by The Business Finance Group, Inc., of
$986,000 which obligation the Debtor guaranteed for Artisan
Partnerships, LLC.
About World of Wood, Ltd.
World of Wood, Ltd. dba Hardwood Aritsans filed a Chapter 11
petition (Bankr. E.D. Va. Case No. 16-13186), on Sept. 19, 2016.
The petition was signed by Curtis Smay, co-CEO. The case is
assigned to Judge Brian F. Kenney. The Debtor is represented by
Christopher L. Rogan, Esq., at ROGANMILLERZIMMERMAN, PLLC. The
Debtor disclosed $320,649 in total assets and $4.23 million in
total liabilities. The petition was signed by Curtis Smay,
co-CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/vaeb16-13186.pdf
WRIGHT'S WELL: Hires HILCO as Asset Marketing and Sales Agent
-------------------------------------------------------------
Wright's Well Control Services, LLC seeks authorization from the
U.S. Bankruptcy Court for the Western District of Louisiana to
employ a joint venture composed of Hilco Industrial LLC, Myron
Bowling Auctioneers and Cincinnati Industrial Auctioneers as Asset
Marketing and Sales Agent, nunc pro tunc to June 2, 2017.
The Debtor requires HILCO to:
(a) develop an advertising and marketing plan for the Assets;
(b) implement the advertising and marketing plan as deemed
necessary by HILCO to maximize net recovery on the Assets;
(c) prepare for the sale of the Assets, including gathering
specifications and photographs for pictorial brochures and
arranging the Assets in a manner, which in HILCO's judgment
would be designed to enhance the net recovery on the
Assets;
(d) provide fully qualified and experienced personnel who will
prepare for and sell the Assets;
(e) provide a complete auction crew to handle computerized
accounting functions necessary to provide auction buyers
with invoices and the Debtor with a complete accounting of
all Assets sold at an auction;
(f) make the Assets available for viewing by potential buyers
and oversee removal;
(g) work with the Debtor for the sale of Assets either through
a negotiated sale or auction for cash to the highest bidder
"as is," "where is," and in accordance with the terms of
the AMA;
(h) submit an initial sales report to the Debtor within
14 days after the sale of the Assets and a final complete
sales report to the Debtor within fourteen days after the
end of the Term.
HILCO will be compensated as follows:
-- in consideration of its services hereunder, HILCO will be
entitled to (i) payment by the Debtor of a commission equal
to 10% of the Gross Proceeds from the sale of the Assets
and (ii) charge and retain for its own account an industry
standard buyer's premium of 16% of the Gross Proceeds for
Assets that are sold. For purposes of clarification, the
buyer's premium is a fee charged in addition to the sale
price of the Assets and is paid for by the buyer. All
commission and buyer's premiums shall be withheld by HILCO
upon collection of proceeds from applicable buyers.
Notwithstanding the foregoing, any of the Assets purchased
by MidSouth, by credit bid shall not be subject to the 16%
buyer's premium, provided that, MidSouth shall be obligated
to pay HILCO a commission equal to 15% of the credit bid to
acquire any of the Assets, which amount shall be paid prior
to the transfer of title to MidSouth.
-- HILCO will advance and will be entitled to reimbursement
by the Debtor for all Expenses regardless whether or not
any Assets are sold, provided that the Expenses shall not
exceed $50,000 without the Debtor and MidSouth's prior
consent and if required by the Bankruptcy Court. "Expenses"
mean reasonable expenses incurred by HILCO in connection
with HILCO's performance of its services hereunder,
including, but not limited to, advertising, promotion and
sales costs, lodging, travel, labor associated with project
management oversight, labor and other costs and expenses
associated with previewing and removing the Assets, and
other miscellaneous costs and expenses. The Debtor and
MidSouth agree that all Expenses may be withheld from Gross
Proceeds of the sale of any Assets or such amounts shall be
paid by MidSouth in the event of a credit bid and there is
insufficient Gross Proceeds to pay such Expenses. HILCO
agrees to use the same level of discretion and judgment in
incurring expenses under this Agreement as it does in
incurring non-reimbursable expenses in its own internal
operations and business.
Ryan Lawlor, vice president and deputy general counsel of Hilco
Trading, 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 Debtor and
its estate.
HILCO can be reached at:
Ryan Lawlor
HILCO INDUSTRIAL, LLC
5 Revere Drive, Suite 206
Northbrook, IL 60062
Tel: (847) 509-1100
Fax: (847) 897-0868
E-mail: rlawlor@hilcoglobal.com
About Wright's Well Control Services, LLC
Wright's Well Control Services, LLC, based in Lake Charles,
Louisiana, filed a Chapter 11 petition (Bankr. W.D. La. Case No.
17-50354) on March 22, 2017. The Hon. Robert Summerhays presides
over the case. Kent H. Aguillard, Esq., at H. Kent Aguillard,
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 David Christopher Wright, the Debtor's manager and member.
XCEL DEVELOPMENT: Case Summary & 6 Unsecured Creditors
------------------------------------------------------
Debtor: Xcel Development, LLC
P.O. Box 295
2145 Route 9W
Cornwall, NY 12518
Tel: 845-222-7352
Business Description: Xcel Development --
http://www.xcelfinehomes.com--
is a real estate developer in Cornwall, New
York. The Debtor sought bankruptcy
protection amid numerous mortgage
foreclosure lawsuits, property liens and
unsecured debts in relation to the
development of residential property. The
Debtor said the foreclosures are in part
due to the failure of Hometown bank to
provide the construction loans to it
pursuant to their mutual understanding.
The Debtor's assets mainly consist
of the Mt. Airy residential building lots.
The Debtor is controlled by a Managing
Member, Christopher Kirwan. There was one
prior bankruptcy case filed by the Debtor on
Oct. 5, 2016 (Bankr. S.D.N.Y. Case No. 16-
36716), which case was dismissed by the
Court.
Chapter 11 Petition Date: June 23, 2017
Case No.: 17-36076
Court: United States Bankruptcy Court
Southern District of New York (Poughkeepsie)
Judge: Hon. Cecelia G. Morris
Debtor's Counsel: Philip A. Wellner, Esq.
WELLNER AND ASSOCIATES PLLC
1376 Route 23
Craryville, NY 12521
Tel: 518-851-2400
Fax: 518-935-9723
Email: pwellner@wellner-law.com
Total Assets: $1.47 million
Total Liabilities: $3.65 million
The petition was signed by Christopher Kirwan, manging member.
The Debtor's list of six unsecured creditors is available for free
at:
http://bankrupt.com/misc/nysb17-36076.pdf
Z LIGHTS AND FURNITURE: Taps Olwan Ghannam as Accountant
--------------------------------------------------------
Z Lights and Furniture received approval from the U.S. Bankruptcy
Court for the Eastern District of Virginia to hire Olwan Ghannam &
Associates as its accountant.
The firm will assist the Debtor in preparing and filing its annual
tax returns and in handling accounting matters related to its
Chapter 11 case.
Olwan Ghannam will charge $525 per month or $350 per hour for its
services.
Fozan Ghannam, an accountant employed with Olwan Ghannam, disclosed
in a court filing that he does not hold any interest adverse to the
Debtor or its bankruptcy estate.
The firm can be reached through:
Fozan Ghannam
Olwan Ghannam & Associates
5144 Leesburg Pike
Alexandria VA 22302
Phone: 703-998-3143
Email: fghannam@ogtax.com
About Z Lights and Furniture
Z Lights and Furniture, based in Alexandria, Virginia, filed a
Chapter 11 petition (Bankr. E.D. Va. Case No. 17-11066) on March
30, 2017. Ghassan Saoudm, president, signed the petition. At the
time of the filing, the Debtor estimated assets of less than
$50,000 and liabilities of less than $500,000.
The Debtor is represented by the Law Offices of Jeffrey M. Sherman.
[*] 24th Annual Distressed Investing Conference - Nov. 27, 2017
---------------------------------------------------------------
Beard Group, Inc., will be hosting the 24th Annual Distressed
Investing Conference on Mon., Nov. 27, 2017 -- the Monday following
Thanksgiving Day -- at The Harmonie Club in Midtown Manhattan.
Sponsorship and speaking opportunities are available. Contact
Joseph S. Cardillo at joseph@beardgroup.com or (856) 381-8268 by
e-mail or Peter A. Chapman at peter@beardgroup.com by e-mail or
(215) 945-7000 by telephone for more information.
This conference is the oldest and most established event in the
distressed debt community, attracting more than 200 of the top
corporate restructuring professionals.
Information about last year's conference is available at
http://bankrupt.com/DI2016/and Beard Group was honored to have
these firms participate in last year's conference:
* A.L. Sarroff Management, LLC
* Berkeley Research Group LLC
* Birch Lake Holdings L.P.
* Bracewell
* Broadbill Investment Partners LP
* Brown Rudnick
* Bryan Cave LLP
* Bryan, Mansell & Tilley LLP
* Cleary Gottlieb Steen & Hamilton
* Columbia Business School
* Conway MacKenzie, Inc.
* Debevoise & Plimpton
* Debtwire
* Development Specialists, Inc.
* Dhalion Advisors LP
* Elliott Management Corp.
* Fairfield University
* Foley & Lardner LLP
* Freshfields Bruckhaus Deringer LLP
* Goldman, Sachs & Co.
* Graham Fisher & Co.
* Grant & Eisenhofer
* Greenberg Traurig, LLP
* Innovation Brain
* Jones Day
* JP Morgan
* Kase Capital Management
* Kasowitz, Benson, Torres & Friedman LLP
* Kirkland & Ellis
* Miller Buckfire & Co., LLC
* Morrison & Foerster
* Mortgage Bankers Association
* Murdock Capital Partners
* NYU Stern School of Business
* O'Melveny & Myers
* Owl Creek Asset Management, L.P.
* Paulson & Co. Inc.
* Perini Capital
* Perry Capital
* Pershing Square Capital Management LP
* PJT Partners Inc.
* Quest Turnaround Advisors
* Reorg Research, Inc.
* Reuters
* Richards, Layton & Finger
* Ruppert Fux Landmann GmbH
* S&P Global Market Intelligence
* Stroock & Stroock & Lavan
* Sullivan & Cromwell
* The Delaware Bay Company LLC
* The New York Times
* Triage Capital Management
* U.S. Bankruptcy Court (S.D.N.Y.)
* UBS Financial Services Inc.
* Virtus Capital, LP
* Walkers Global
* Weil Gotshal & Manges
* White & Case LLP
[*] CFPB, Law Firms Ordered to Mediate Deceptive Debt-Relief Claims
-------------------------------------------------------------------
Steven Trader, writing for Bankruptcy Law360, reports that U.S.
District Judge Josephine Staton ordered the Consumer Financial
Protection Bureau, Howard Law PC and two other firms to mediate a
dispute over the firms' alleged running of a debt-relief scheme
that extracted millions in "exorbitant" and illegal advance fees
from consumers with large debts.
In its January 2017 lawsuit, CFPB alleged that the firms violated
the Telemarketing and Consumer Fraud and Abuse Prevention Act, the
Federal Trade Commission's Telemarketing Sales Rule and the
Consumer Financial Protection Act of 2010. CFPB accused that the
firms and Morgan Drexen collected millions of dollars in illegal
advance fees from vulnerable consumers suffering from financial
difficulties, promising them that the law firms would negotiate
affordable repayments but rarely succeeding, according to the
complaint, Law360 relates.
The case is Consumer Financial Protection Bureau v. Vincent Howard
et al., case number 8:17-cv-00161, in the U.S. District Court for
the Northern District of California. It named as defendants
Williamson Law Firm LLC, Howard Law Firm and Williamson & Howard
LLP, along with owners Vincent Howard and Lawrence Williamson.
[*] Frank JC Newbould Joins Thornton Grout & Arbitration Place
--------------------------------------------------------------
The Hon. Frank J.C. Newbould, Q.C., has joined Thornton Grout
Finnigan LLP, and Arbitration Place.
Mr. Newbould, who retired from the Ontario Superior Court of
Justice on June 1, 2017, will join the roster at Arbitration Place
as a Member Arbitrator, where clients will benefit from his
extensive experience resolving disputes fairly and efficiently. He
also joins TGF, as counsel to the firm, where he will share his
expertise and significant experience in multi-jurisdictional
restructuring proceedings and litigation strategy with the firm's
national and international clients, serve as a resource to members
of the firm and provide input on client files.
During his more than ten years on the bench Mr. Newbould served
most recently as the Team Leader of the Commercial List in Toronto,
the country's first specialized commercial court. As a judge,
counsel, and arbitrator, Frank Newbould has earned a reputation as
a "giant" in commercial law. He has advanced the law and practice
in a variety of complex and high profile cases, including presiding
over the first cross-border trial between a Canadian Court and a
foreign Court (Delaware Bankruptcy Court) in the worldwide Nortel
insolvency proceedings.
He has been regularly cited in directories including Chambers
Global, the International Who's Who of Business Lawyers and the
Lexpert/American Lawyer Guide to the 500 Leading Lawyers in Canada.
In 2016 Canadian Lawyer magazine named him one of the Top 25 Most
Influential Lawyers in Canada. Mr. Newbould was called to the bar
in 1969, and was appointed Queen's Counsel in 1981. He is a Fellow
of the American College of Trial Lawyers, a Chartered Arbitrator
with the ADR Institute of Canada, and a member of the ICC Canada
arbitration committee.
Mr. Newbould can be reached at:
Thornton Grout Finnigan LLP
Suite 3200, 100 Wellington Street West
P.O. Box 329, Toronto-Dominion Centre
Toronto, ON, M5K 1K7
Canada
Tel: +1(416) 304-7980
E-mail: fnewbould@tgf.ca
-- and --
Arbitration Place Toronto
Bay Adelaide Centre
333 Bay Street, Suite 900
Toronto ON M5H 2R2
Tel: +1(416) 848-0203
E-mail: fnewbould@arbitrationplace.com
About Thornton Grout
Thornton Grout Finnigan LLP -- www.tgf.ca -- is a Canadian law firm
located in Toronto, Ontario focused on commercial litigation and
restructuring. It is regularly involved in some of the most
complex and high profile Canadian and cross-border litigation and
insolvency cases, resulting in it being named "Insolvency Firm of
the Year" by Benchmark Litigation Canada for each of the past 3
years and in Canadian Lawyer Magazine's Top 10 Litigation
Boutiques. Lexpert's Guide to Leading Lawyers in Canada
consistently ranks TGF as a leading law firm in its areas of
practice, and 100% of its partners are individually recognized.
Clients of the firm include financial institutions and other
lenders, regulatory agencies, private and public companies, pension
plans, bondholders and court officers appointed in restructuring
and litigation proceedings.
About Arbitration Place
Arbitration Place -- www.arbitrationplace.com -- is a fully
integrated arbitration centre located in the Canada's financial
district in downtown Toronto, with a scheduled expansion to Ottawa,
Canada's national capital, in September 2017. Featuring a roster
of internationally-renowned resident and member arbitrators,
Arbitration Place offers an 'all-encompassing approach', which
includes state-of-the-art hearing and breakout rooms,
concierge-level administrative services, an on-site commercial
kitchen staffed by a team of chefs, and in-house legal counsel to
act as a tribunal secretary.
Arbitration Place hosts an on-site court reporting service offering
a full portfolio of reporting, transcription, and videography
services, staffed with personnel that have the highest
certification standards and years of experience handling arbitral
proceedings.
[^] BOND PRICING: For the Week from June 19 to 23, 2017
-------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
A. M. Castle & Co CASL 5.250 15.000 12/30/2019
A. M. Castle & Co CASL 7.000 58.000 12/15/2017
AV Homes Inc AVHI 8.500 104.070 7/1/2019
Actavis Inc AGN 1.875 100.010 10/1/2017
Affinion Investments LLC AFFINI 13.500 102.000 8/15/2018
Alpha Appalachia
Holdings Inc ANR 3.250 0.750 8/1/2015
American Eagle Energy Corp AMZG 11.000 0.933 9/1/2019
Armstrong Energy Inc ARMS 11.750 46.125 12/15/2019
Armstrong Energy Inc ARMS 11.750 46.125 12/15/2019
Avaya Inc AVYA 10.500 10.438 3/1/2021
Avaya Inc AVYA 10.500 14.500 3/1/2021
BPZ Resources Inc BPZR 6.500 3.017 3/1/2015
BPZ Resources Inc BPZR 6.500 3.017 3/1/2049
Bon-Ton Department
Stores Inc/The BONT 8.000 40.500 6/15/2021
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 7.875 30.500 4/15/2022
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 8.625 30.500 10/15/2020
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 8.625 23.250 10/15/2020
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 8.625 23.250 10/15/2020
Buffalo Thunder
Development Authority BUFLO 11.000 38.250 12/9/2022
CONSOL Energy Inc CNX 6.375 101.375 3/1/2021
Caesars Entertainment
Operating Co Inc CZR 5.750 87.000 10/1/2017
Chassix Holdings Inc CHASSX 10.000 8.000 12/15/2018
Chassix Holdings Inc CHASSX 10.000 8.000 12/15/2018
Chesapeake Energy Corp CHK 2.750 99.000 11/15/2035
Chukchansi Economic
Development Authority CHUKCH 9.750 41.375 5/30/2020
Chukchansi Economic
Development Authority CHUKCH 9.750 41.375 5/30/2020
Cinedigm Corp CIDM 5.500 35.000 4/15/2035
Claire's Stores Inc CLE 9.000 50.750 3/15/2019
Claire's Stores Inc CLE 6.125 46.500 3/15/2020
Claire's Stores Inc CLE 8.875 11.500 3/15/2019
Claire's Stores Inc CLE 7.750 12.875 6/1/2020
Claire's Stores Inc CLE 9.000 46.250 3/15/2019
Claire's Stores Inc CLE 9.000 50.500 3/15/2019
Claire's Stores Inc CLE 6.125 40.750 3/15/2020
Claire's Stores Inc CLE 7.750 12.875 6/1/2020
Cobalt International
Energy Inc CIE 2.625 26.500 12/1/2019
Coeur Mining Inc CDE 7.875 103.709 2/1/2021
Cumulus Media Holdings Inc CMLS 7.750 28.679 5/1/2019
EV Energy Partners LP /
EV Energy Finance Corp EVEP 8.000 52.186 4/15/2019
Emergent Capital Inc EMGC 8.500 45.827 2/15/2019
Energy Conversion
Devices Inc ENER 3.000 7.875 6/15/2013
Energy Future Holdings Corp TXU 6.500 12.500 11/15/2024
Energy Future Holdings Corp TXU 6.550 12.500 11/15/2034
Energy Future Holdings Corp TXU 9.750 29.250 10/15/2019
Energy Future Holdings Corp TXU 5.550 8.500 11/15/2014
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 11.250 36.000 12/1/2018
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 9.750 35.625 10/15/2019
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 11.250 35.000 12/1/2018
FirstCash Inc FCFS 6.750 105.400 4/1/2021
Fleetwood Enterprises Inc FLTW 14.000 3.557 12/15/2011
GenOn Energy Inc GENONE 9.500 67.250 10/15/2018
GenOn Energy Inc GENONE 9.500 67.331 10/15/2018
GenOn Energy Inc GENONE 9.500 67.317 10/15/2018
Global Brokerage Inc GLBR 2.250 42.000 6/15/2018
Gymboree Corp/The GYMB 9.125 1.000 12/1/2018
Homer City Generation LP HOMCTY 8.137 38.750 10/1/2019
Illinois Power Generating Co DYN 7.000 33.000 4/15/2018
Illinois Power Generating Co DYN 6.300 36.250 4/1/2020
IronGate Energy Services LLC IRONGT 11.000 34.500 7/1/2018
IronGate Energy Services LLC IRONGT 11.000 34.500 7/1/2018
IronGate Energy Services LLC IRONGT 11.000 34.500 7/1/2018
IronGate Energy Services LLC IRONGT 11.000 34.500 7/1/2018
Las Vegas Monorail Co LASVMC 5.500 0.833 7/15/2019
Lehman Brothers Holdings Inc LEH 5.000 3.326 2/7/2009
Lehman Brothers Holdings Inc LEH 4.000 3.326 4/30/2009
Lehman Brothers Holdings Inc LEH 2.070 3.326 6/15/2009
Lehman Brothers Holdings Inc LEH 1.383 3.326 6/15/2009
Lehman Brothers Holdings Inc LEH 2.000 3.326 3/3/2009
Lehman Brothers Holdings Inc LEH 1.500 3.326 3/29/2013
Lehman Brothers Holdings Inc LEH 1.600 3.326 11/5/2011
Lehman Brothers Inc LEH 7.500 1.226 8/1/2026
MF Global Holdings Ltd MF 3.375 27.500 8/1/2018
MModal Inc MODL 10.750 10.125 8/15/2020
Mashantucket Western
Pequot Tribe MASHTU 7.350 19.375 7/1/2026
Midstates Petroleum
Co Inc / Midstates
Petroleum Co LLC MPO 10.750 0.473 10/1/2020
Mirant Mid-Atlantic
Series B Pass
Through Trust GENONE 9.125 97.625 6/30/2017
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 2.741 5/15/2019
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 2.741 5/15/2019
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 2.741 5/15/2019
Nine West Holdings Inc JNY 6.125 10.938 11/15/2034
Nine West Holdings Inc JNY 6.875 15.000 3/15/2019
Nine West Holdings Inc JNY 8.250 25.000 3/15/2019
Nine West Holdings Inc JNY 8.250 21.750 3/15/2019
Nuverra Environmental
Solutions Inc NESC 12.500 21.875 4/15/2021
OMX Timber Finance
Investments II LLC OMX 5.540 9.250 1/29/2020
Permian Holdings Inc PRMIAN 10.500 29.125 1/15/2018
Permian Holdings Inc PRMIAN 10.500 29.125 1/15/2018
Pernix Therapeutics
Holdings Inc PTX 4.250 31.000 4/1/2021
Pernix Therapeutics
Holdings Inc PTX 4.250 29.963 4/1/2021
Prospect Holding Co LLC /
Prospect Holding
Finance Co PRSPCT 10.250 48.250 10/1/2018
Renco Metals Inc RENCO 11.500 22.250 7/1/2003
Rolta LLC RLTAIN 10.750 16.700 5/16/2018
Samson Investment Co SAIVST 9.750 7.960 2/15/2020
SandRidge Energy Inc SD 7.500 2.319 2/15/2023
SunEdison Inc SUNE 3.375 2.001 6/1/2025
SunEdison Inc SUNE 2.750 2.250 1/1/2021
SunEdison Inc SUNE 2.375 2.313 4/15/2022
SunEdison Inc SUNE 0.250 2.313 1/15/2020
SunEdison Inc SUNE 5.000 10.500 7/2/2018
SunEdison Inc SUNE 2.000 2.250 10/1/2018
SunEdison Inc SUNE 2.625 2.313 6/1/2023
TMST Inc THMR 8.000 18.750 5/15/2013
Talos Production LLC /
Talos Production
Finance Inc TALPRO 9.750 62.625 2/15/2018
Talos Production LLC /
Talos Production
Finance Inc TALPRO 9.750 62.625 2/15/2018
TerraVia Holdings Inc TVIA 5.000 42.000 10/1/2019
TerraVia Holdings Inc TVIA 6.000 60.587 2/1/2018
Terrestar Networks Inc TSTR 6.500 10.000 6/15/2014
Trans-Lux Corp TNLX 8.250 20.125 3/1/2012
UCI International LLC UCII 8.625 6.875 2/15/2019
Vanguard Natural
Resources LLC /
VNR Finance Corp VNR 7.875 49.500 4/1/2020
Vanguard Operating LLC VNR 8.375 50.000 6/1/2019
Verizon Communications Inc VZ 1.100 99.824 11/1/2017
Walter Energy Inc WLTG 9.500 0.370 10/15/2019
Walter Energy Inc WLTG 9.500 0.370 10/15/2019
Walter Energy Inc WLTG 9.875 0.834 12/15/2020
Walter Energy Inc WLTG 9.500 0.370 10/15/2019
Walter Energy Inc WLTG 9.500 0.370 10/15/2019
Walter Energy Inc WLTG 8.500 0.834 4/15/2021
Walter Energy Inc WLTG 9.875 0.834 12/15/2020
Walter Energy Inc WLTG 9.875 0.834 12/15/2020
Walter Investment
Management Corp WAC 4.500 33.500 11/1/2019
iHeartCommunications Inc IHRT 10.000 57.779 1/15/2018
iHeartCommunications Inc IHRT 6.875 59.868 6/15/2018
rue21 inc RUE 9.000 3.500 10/15/2021
rue21 inc RUE 9.000 4.400 10/15/2021
*********
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 2017. 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
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000 or Nina Novak at 202-362-8552.
*** End of Transmission ***