/raid1/www/Hosts/bankrupt/TCR_Public/180312.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, March 12, 2018, Vol. 22, No. 70
Headlines
4 WEST HOLDINGS: March 16 Meeting Set to Form Creditors' Panel
54 NIPOMO: Taps Pacifica Commercial Realty as Real Estate Broker
6 VIA PARADISO: Taps Law Office of Mike Beede as Legal Counsel
919 PROSPECT: Additional Financing From White Oak Has Interim OK
A & K ENERGY: Asks Exclusivity Pending Plan Confirmation
ABERCROMBIE & FITCH: S&P Alters Outlook to Stable & Affirms BB- CCR
ALAMO TOWERS: Wants Exclusive Plan Filing Deadline Moved to May 16
ALL AMERICAN: U.S. Trustee Unable to Appoint Committee
B N EMPIRE: Wants to Maintain Plan Exclusivity Through May 4
BEERCO LIMITED: Taps Goldberg Weprin as Bankruptcy Counsel
BLACKMAN COMMUNITY: Taps Jason Shirey as Real Estate Appraiser
BON-TON STORES: Challenges Noteholders' Credit Bid Rights
BON-TON STORES: Noteholders Defend Credit Bid Rights
BOSSLER ROOFING: Seeks July 10 Exclusive Plan Period Extension
BTH QUITMAN: May Obtain Unsecured DIP Financing From Heetway
BUANNO TRANSPORT: Voluntary Chapter 11 Case Summary
CAMBER ENERGY: Signs LOI to Acquire Texas Assets for $250,000
CAPITOL SUPPLY: Delays Plan Pursuing Settlement Negotiations
CARECENTRIX INC: Moody's Affirms B1 CFR & Alters Outlook to Neg.
CAREVIEW COMMUNICATIONS: HealthCor et al Have 41.2% Stake
CLEVELAND BIOLABS: Alpha Capital Stake Now at 1.77% as of April 20
COBALT INTERNATIONAL: Suspends Filing of Reports with SEC
COMMUNITY HOME: Trustee Awarded Damages in Suit v. Dickson, et al.
CONSTRUCTION MATERIALS: Taps Honey Law Firm as Legal Counsel
CORPORATE RESOURCE: Trustee Reaches Deal with Crowe Horwath
CUISINE365 LLC: Taps Demetrius J. Parrish as Legal Counsel
CYANCO INTERMEDIATE 2: S&P Lowers Rating on 1st Lien Debt to B
CYTOSORBENTS CORP: OKs 129.7K Restricted Stock Units Bonus Awards
D&M INVESTMENTS: Sale of Ramada Inn Delays Plan Filing
DATA COOLING: Files Chapter 11 Plan of Liquidation
DETROIT SERVICE: S&P Cuts 2011 Public School Bonds Rating to 'B'
DIFFUSION PHARMACEUTICALS: Falls Short of Nasdaq's Bid Price Rule
DPW HOLDINGS: Buys Additional 1,000 Shares of WSI Industries
ECOARK HOLDINGS: Zest Labs Inks $1.5M Services Pact with Walmart
ECORSE, MI: S&P Lowers 2011 Financial Recovery Bonds to 'BB-'
ENVIGO HOLDINGS: S&P Affirms 'B-' CCR, Outlook Developing
EXTENDED STAY: S&P Alters Outlook to Positive & Affirms 'BB-' CCR
FARGO TRUCKING: Needs Time to Resolve Fraudulent Conveyance Claims
FASTENER ACQUISITION: Moody's Assigns B3 Corporate Family Rating
FASTENER ACQUISITION: S&P Assigns 'B' CCR, Outlook Stable
FIRESTAR DIAMOND: Seeks to Hire Getzler Henrich, Appoint CRO
FLYING COW: Case Summary & 4 Unsecured Creditors
GADFLY ENTERPRISES: Taps Mobile Accounting USA as Accountant
GASTAR EXPLORATION: Closes Sale of Acreage in Oklahoma for $107.5M
GB SCIENCES: Terminates Business Relationship with Pacific Leaf
GENESIS TOTAL: Taps Atty. George Jacobs as Legal Counsel
GENON ENERGY: Subsidiary to Pay Peabody Coalsales $80K Cure Amount
GILDED AGE: Court Denies Access to Cash Collateral
GREENTECH AUTOMOTIVE: Sec. 341 Creditors' Meeting Set for April 5
HARDES PARTNERSHIP: Case Summary & 3 Unsecured Creditors
HCR MANORCARE: Taps Epiq as Claims and Noticing Agent
HEARING HEALTH: Taps Wernette Heilman as Legal Counsel
HELP KIDS: Taps Leonard K. Welsh as Legal Counsel
HGIM CORP: S&P Cuts CCR to 'D' After Chapter 11 Bankruptcy Filing
HI-LO FARMS: Gets Authorization to Use Cash Collateral
HOUGHTON MIFFLIN: S&P Lowers CCR to 'B-' on Negative Cash Flow
HUMANIGEN INC: Black Horse Entities Become Majority Owners
HUMANIGEN INC: Nomis Bay Has 31.4% Stake as of March 5
HYLAND SOFTWARE: Moody's Affirms B2 CFR After Debt-Funded Purchase
ICONIX BRAND: Radcliffe Capital Has 9.5% Stake as of Feb. 22
IHEARTCOMMUNICATIONS INC: Inks Forbearance Agreement with Lenders
IHEARTCOMMUNICATIONS INC: OKs Bonuses for Executives Under KEIP
IOWA FINANCE: Fitch Rates Series 2018 A&B Revenue Bonds 'B-'
J.C. PENNEY: S&P Rates New $350MM Second-Lien Notes Due 2025 'B'
JACOB WIRTH: Court Sets March 13 Hearing on Exclusivity Motion
JADE INVESTMENTS: Wilmington Trust Wants to Ban Cash Collateral Use
JAMES R. PITCAIRN: Taps Einwag Morrow as Accountant
JC PENNEY: Moody's Affirms B1 CFR & Rates New 2nd Priority Notes B1
JONES & PINER: PFCU Wants to Prohibit Cash Collateral Use
KMR HOLDINGS: U.S. Trustee Unable to Appoint Committee
LAYLA GRAYCE: Case Summary & 20 Largest Unsecured Creditors
LEVERETTE TILE: Delays Filing of Liquidating Plan Until Sale Closes
LEVERETTE TILE: Has Until April 2 to Exclusively File Plan
LIFE TIME: Moody's Affirms B2 CFR After $200MM Term Loan Add-on
LIGHTBRIDGE CORP: Will be Featured in International Journal
LONG BLOCKCHAIN: Appoints Loretta Joseph to Board of Directors
LOTUS INDUSTRIES: Hires Andrew A. Paterson, Jr. Counsel
MADISON-LARAMIE SELF STORAGE: Taps Chuhak & Tecson as Counsel
MANHATTAN JEEP: Case Summary & 20 Largest Unsecured Creditors
MCCLATCHY CO: Bluestone 5.16% of Shares as of March 2
MDM PHYSICAL: Taps Richardson & Richardson as Legal Counsel
MEDIACOM COMMUNICATIONS: S&P Affirms BB CCR, Alters Outlook to Pos.
MERCYFULL HOME: Case Summary & 2 Unsecured Creditors
MONAKER GROUP: Reduces Pacific Grove Warrants Exercise Prices
MOUNTAIN CREEK RESORT: Has Until April 8 to Exclusively File Plan
NORFOLK STREET: Taps DelBello Donnellan Weingarten as Attorney
NUSTAR ENERGY: Fitch Affirms BB IDR & Alters Outlook to Negative
OAKTREE SPECIALTY: S&P Raises ICR & Sr. Unsec. Notes Rating to BB+
OMINTO INC: Submits its Plan to Regain Nasdaq Compliance
OMNITRACS LLC: Moody's Assigns B2 CFR & Rates New 1st Lien Loans B2
ONE HORIZON: Inks Exchange Agreement with C-Rod
PACIFIC DRILLING: Wants Plan Filing Deadline Moved to July 10
PACIFIC DRILLING: Wants Plan Filing Deadline Moved to July 10
PARAGON GLOBAL: Needs More Time to Analyze New Sources of Revenue
PATRIOT NATIONAL: Court Enters Final OK on $15.5-Mil. Financing
PETROLIA ENERGY: Completes Acquisition of Bow Energy
PETROQUEST ENERGY: Lowers Fourth Quarter Net Loss to $389,000
PMHC II: S&P Assigns 'B-' Corp. Credit Rating, Outlook Positive
POINTE SDMU: Case Summary & 9 Unsecured Creditors
PREFERRED CARE: May Obtain Financing, Use Cash on Final Basis
PROVIDENCE WIRELESS: Taps Rice Pugatch Robinson as Special Counsel
PROVIDENCE WIRELESS: Taps Shraiberg Landau as Legal Counsel
PUERTO RICO: Contract Spending Speeds Up with Army Corps Exit
QUALITY CARE: Inks Plan Support Agreement with HCR ManorCare
REAL ALLOY: Unsecureds Back Sale of Real Alloy to Noteholders
REAL T PROPERTIES: Taps Mark S. Roher as Legal Counsel
RESOLUTE ENERGY: Fir Tree Narrows Stake to 7.1% as of March 1
REVOLUTION ALUMINUM: Trustee Plan to Reissue New Equity Interests
ROBERT T. WINZINGER: Seeks 90-Day Extension of Exclusivity Periods
ROSE COURT: Unsecured Creditors to Get 100% Under Plan
SCRIBEAMERICA INTERMEDIATE: Moody's Assigns B3 Corp. Family Rating
SEMLER SCIENTIFIC: Incurs $1.5 Million Net Loss in 2017
SENIOR CARE: Exclusive Plan Filing Period Extended to April 30
SIVYER STEEL: Involuntary Chapter 11 Case Summary
SOUTHCROSS ENERGY: Gen Partner CEO Takes Medical Leave of Absence
SOUZA PROPERTIES: Voluntary Chapter 11 Case Summary
SPINLABEL TECHNOLOGIES: Plan Filing Deadline Moved to April 6
SPRINGLEAF FINANCE: Fitch to Rate $500MM Sr. Unsecured Notes B(EXP)
TEXDOM INVESTMENTS: Wants Insurance Financing Pact With IPFS
TITAN ENERGY: GSO/Blackstone Have 17.9% Stake as of Feb. 26
TOPS HOLDING: U.S. Trustee Forms Seven-Member Committee
TOYS "R" US: Reportedly Prepping Shutdown of U.S. Stores
TRIAD WELL: U.S. Trustee Unable to Appoint Committee
TWO RIVERS: Making Progress on its Hemp Crop Share Arrangement
US OIL: US Court Recognizes Canadaian Ruling Granting Financing
VICI PROPERTIES: S&P Raises CCR to 'BB' on Improved Leverage
VILLAGE VENTURE: U.S. Trustee Unable to Appoint Committee
WALKING CO: March 20 Meeting Set to Form Creditors' Panel
WEATHERFORD INTERNATIONAL: Closes Tender Offer for 9.625% Notes
WEATHERFORD INTERNATIONAL: Completes $600 Million Notes Offering
WELLS ENTERPRISES: S&P Assigns 'BB' Rating on New $175MM Term Loan
WICKED TACO: Case Summary & 6 Unsecured Creditors
WILMA'S DEN: Voluantary Chapter 11 Case Summary
WRAP MEDIA: Court Approves Disclosure Statement
WTE-S&S AG: Lender Plan Proposes 50% Recovery to Unsecureds
ZERO ENERGY: Voluntary Chapter 11 Case Summary
[*] ILR Criticizes Asbestos Trust Sufficiency & Safeguards
[^] BOND PRICING: For the Week from March 5 to 9, 2018
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4 WEST HOLDINGS: March 16 Meeting Set to Form Creditors' Panel
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William T. Neary, United States Trustee for Region 6, will hold an
organizational meeting on March 16, 2018, at 12:30 p.m. in the
bankruptcy cases of 4 West Holdings, Inc., et al.
The meeting will be held at:
Office of the U. S. Trustee
Earl Cabell Federal Building
1100 Commerce Street, Room 524
Dallas, Texas 75242
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors pursuant
to Section 341 of the Bankruptcy Code. A representative of the
Debtor, however, may attend the Organizational Meeting, and provide
background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States Trustee
appoint a committee of unsecured creditors as soon as practicable.
The Committee ordinarily consists of the persons, willing to serve,
that hold the seven largest unsecured claims against the debtor of
the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee may
consult with the debtor, investigate the debtor and its business
operations and participate in the formulation of a plan of
reorganization. The Committee may also perform other services as
are in the interests of the unsecured creditors whom it
represents.
About 4 West Holdings
4 West Holdings, Inc., et al. — http://www.orianna.com— are
licensed operators of 41 skilled nursing facilities and manage one
skilled nursing facility located in seven states: Georgia, Indiana,
Mississippi, North Carolina, South Carolina, Tennessee and
Virginia. In addition, one of related entity, Palladium Hospice and
Palliative Care, LLC f/k/a Ark Hospice, LL,C provides hospice and
palliative care services at certain of the Facilities and other
third party locations. They employ approximately 5,000 people,
including but not limited to, nurses, nursing assistants, social
workers, regional directors and supervisors.
4 West Holdings, Inc. and 134 of its affiliates and subsidiaries
filed voluntary petitions in the United States Bankruptcy Court for
the Northern District of Texas in Dallas seeking relief under the
provisions of Chapter 11 of the United States Bankruptcy Code on
March 6, 2018 (Bankr. N.D. Tex. Lead Case No. 18-30777), with a
restructuring plan that contemplates the transfer of 22 facilities
to new operations.
The Debtors continue to operate their businesses and manage their
properties as debtors-in-possession.
4 West Holdings estimated $10 million to $50 million in assets and
$50 million to $100 million in liabilities as of the filing.
The Hon. Harlin DeWayne Hale is the case judge.
The Debtors tapped DLA PIPER LLP (US) as bankruptcy counsel;
HOULIHAN LOKEY as investment banker; CROWE HORWATH LLP as financial
advisor; ANKURA CONSULTING GROUP, LLC, as interim management
services provider; and RUST CONSULTING/OMNI BANKRUPTY as claims
agent.
54 NIPOMO: Taps Pacifica Commercial Realty as Real Estate Broker
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54 Nipomo Partners, LLC, received approval from the U.S. Bankruptcy
Court for the Northern District of California to hire Pacifica
Commercial Realty as its real estate broker.
The firm will assist the Debtor in the sale of its real property
located at 170 South Frontage Road, Nipomo, California.
The Debtor will pay the firm a commission of 5% of the purchase
price to be split with the buyer's agent, if any. The listing
price of the property is $5.75 million.
Pacifica Commercial Realty does not hold any interest adverse to
the Debtor's estate, according to court filings.
The firm can be reached through:
Gerald Jankowski
Pacifica Commercial Realty
2520 Professional Parkway
Santa Maria, CA 93455
Tel: (805) 928-2800
Fax: (805) 349-9375
E-mail: Gerald@PacificaCRE.com
About 54 Nipomo Partners
54 Nipomo Partners, LLC, listed its business as single asset real
estate (as defined in 11 U.S.C. Section 101(51B)) whose principal
assets are located at 170 South Frontage Road Nipomo, California.
54 Nipomo Partners sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Cal. Case No. 18-40282) on Feb. 1,
2018. In the petition signed by Robert Marinai, general manager,
the Debtor estimated assets and liabilities of $1 million to $10
million. Judge Charles Novack presides over the case. Kornfield,
Nyberg, Bendes, Kuhner & Little, P.C. is the Debtor's bankruptcy
counsel.
6 VIA PARADISO: Taps Law Office of Mike Beede as Legal Counsel
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6 Via Paradiso, LLC, seeks approval from the U.S. Bankruptcy Court
for the District of Nevada to hire The Law Office of Mike Beede,
PLLC, as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; assist in the preparation of a plan of
reorganization; prosecute actions to protect its bankruptcy estate;
and provide other legal services related to its Chapter 11 case.
Beede charges an hourly fee of $300 for its attorneys and $100 for
paraprofessionals.
The firm and its associates are "disinterested persons" as defined
in section 101(14) of the Bankruptcy Code, according to court
filings.
Beede can be reached through:
Michael Beede, Esq.
The Law Office of Mike Beede, PLLC
2470 St. Rose Parkway, Suite 201
Henderson, NV 89074
Tel: 702-473-8406
Fax: 702-832-0248
E-mail: eservice@LegalLV.com
About 6 Via Paradiso
6 Via Paradiso, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Nev. Case No. 17-16658) on Dec. 14,
2017. Judge Laurel E. Davis presides over the case. At the time
of the filing, the Debtor estimated assets of less than $500,000
and liabilities of less than $1 million.
919 PROSPECT: Additional Financing From White Oak Has Interim OK
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The Hon. Shelley C. Chapman of the U.S. Bankruptcy Court for the
Southern District of New York has authorized on an interim basis
Ian Gazes, the Chapter 11 trustee for 919 Prospect Ave LLC, to
enter into into additional postpetition financing agreement with
White Oak Profit Sharing Plan, nunc pro tunc to Feb. 27, 2018,
until entry of a final order following a final hearing on the
motion.
The sole asset in this case is the Debtor's fee simple interest in
certain real property located at 919 Prospect Avenue, Bronx, New
York, consisting of 37 residential rental units and additional
commercial rental units located on the Property's ground floor.
Although the construction work is partially completed, and the City
agencies have removed certain violations there remains a
considerable amount of construction work for lines "C", "F", and
"G". The cost of construction for the Lines is approximately
$848,000 not including costs of administration like the fees and
expenses of the property and construction managers. The Property's
rental income, which was used pre-petition to service the mortgage
on the Property and to pay the Debtor's ordinary course operating
expenses, is insufficient to fund the extensive repairs and
remediation to the Lines.
Accordingly, the Chapter 11 Trustee seeks the Court's approval of
his proposed agreement with the Lender, the Debtor's owner and an
entity controlled by the Debtor's principal, whereby the Lender has
agreed to remit to the estate and additional sum of $848,000.
Previously the Trustee obtained financing from the Lender pursuant
to a Note the sum of $1 million, which provided for additional
funding of $250,000 and was approved by the Court pursuant to the
final court order. The funds remitted form the 1st Note were used
to pay construction costs primarily for Line "A" and related
emergency repairs at the property.
The principal terms of the 2nd Note, which supersedes and replaces
the 1st Note, are:
-- Interest Rate: 8% per annum with regard to funds loaned
under the 2nd Note with no change of interest on funds
loaned under the 1st Note; if there is an Event of Default
principal balance of all loans at 24% based upon a 360 day
year;
-- Maturity: The earlier of the sale of the Property under a
confirmed Chapter 11 plan or the sale of the Property by a
Chapter 7 trustee or subject to Section 5(a), 18 months
after the date that 2nd Note is approved by the Court and
funding occurs;
-- Events of Default: (a) Failure to make required payment
when due; false or misleading material representation or
warranty by borrower; breach of borrower's obligations
under note; borrowers commencement of "Adverse Bankruptcy
Action"; entry of order granting Adverse Bankruptcy
Action; conversion of bankruptcy case to Chapter 7 case;
occurrence of "Event of Default" under interim Financing
Order; final Financing Order is not entered within 45 days
after the date the interim Financing Order is entered;
-- Liens: the Lender will have lien on Property junior to all
Prior Liens;
-- Borrowing Limits: $2.098 million subject to increase of up
to $250,000 on consent of Borrower and Lender; and
-- Borrowing Conditions: (i) entry of Financing Order; (ii)
absence of Adverse Bankruptcy Action; (iii) no Event of
Default; (v) borrower has provided Lender with al required
information; (vi) borrower's compliance with Note; and
(vii) accuracy of representations and warranties.
To the extent the Trustee has utilized the 2nd Credit Facility the
Lender will have a perfected secured lien attaching to the
Property, subordinate to all Prior Liens, as that term is defined
in the 2nd Note.
The Debtor, Lender, and the Chapter 11 Trustee are authorized to
take those steps necessary to give full force and effect to the 2nd
Credit Facility.
The Chapter 11 Trustee's authorization to use the 2nd Credit
Facility will be subject to the following terms and restrictions:
-- from the entry of the Interim Order and continuing until
entry of a final court order or an Event of Default, the
Lender will fund the 2nd Credit Facility as provided under
the 2nd Note; and
-- the Lender is granted a security interest in and against
the Property, junior to all Prior Liens, as that term is
defined in and pursuant to the terms of the Note. The
Lender, subject to a separate Order of the Court under
U.S. Bankruptcy Code Section 362, is authorized but not
required to file this Note as evidence of the Lender's
effective and valid junior lien as against the Property.
Until all Obligations have been fully satisfied, the
Lender's security interest in the Property will continue
in full force and effect. Notwithstanding the foregoing,
or any failure on the part of the Lender to take any of
the actions set forth herein, the liens and security
interests granted will be deemed valid, enforceable and
perfected by entry of this interim court order. No
financing statement, notice of lien, mortgage, deed of
trust or similar instrument in any jurisdiction or filing
office need to be filed or any other action taken in order
to validate and perfect the Liens and security interests
granted by or pursuant to the 2nd Note or this interim
court order.
Copies of the motion and the court order are available at:
http://bankrupt.com/misc/nysb16-13569-101.pdf
http://bankrupt.com/misc/nysb16-13569-109.pdf
About 919 Prospect
919 Prospect Ave LLC filed a Chapter 11 bankruptcy petition (Bankr.
S.D.N.Y. Case No. 16-13569) on Dec. 22, 2016, disclosing total
assets of $5 million and total liabilities of $2.40 million. The
petition was signed by Seth Miller, managing member of Debtor and
the trustee of White Oak Profit Sharing Plan, which is also a
member of the Debtor.
The Hon. Shelley C. Chapman is the case judge.
Rosen, Kantrow & Dillon, PLLC, served as the Debtors bankruptcy
counsel.
Ian J. Gazes was later appointed as Chapter 11 trustee. The
Trustee hired Gazes LLC as his bankruptcy counsel; MYC &
Associates, Inc., as property manager; and CBIZ Accounting, Tax and
Advisory of New York, LLC, as financial advisor.
A & K ENERGY: Asks Exclusivity Pending Plan Confirmation
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A & K Energy Conservation, Inc., asks the U.S. Bankruptcy Court for
the Middle District of Florida to extend the 180-day period during
which it has the exclusive right to solicit acceptances of the plan
of reorganization so that the extended 180-day period will expire
upon the Court's conclusion of the hearing to consider
confirmation, without prejudice to the Debtor's right to seek
further extensions.
As reported by the Troubled Company Reporter on Nov. 23, 2017, the
Court extended the exclusive period by which only the Debtor could
propose and file its plan of reorganization and disclosure
statement through Jan. 31, 2018, as well as the exclusive period to
solicit acceptances of its plan through April 2, 2018.
The Debtor assures the Court that its motion is not submitted for
purposes of delay and the Debtor submits that the relief requested
in this motion will not prejudice any party, as the confirmation
hearing has been scheduled for May 17, 2018.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/flmb17-03318-326.pdf
About A & K Energy Conservation, Inc.
A&K Energy Conservation, Inc. -- http://www.akenergy.com/-- offers
customized lighting solutions and energy management services,
including energy audits, lighting retrofits, rebate processing, and
more.
A & K Energy Conservation filed a Chapter 11 petition (Bankr. M.D.
Fla. Case No. 17-03318) on April 19, 2017. William Maloney, chief
restructuring officer, signed the petition. The case is assigned
to Judge Catherine Peek McEwen. The Debtor is represented by Amy
Denton Harris, Esq., and Mark F Robens, Esq., at Stichter, Riedel,
Blain & Postler, P.A. The Debtor estimated assets and liabilities
between $1 million and $10 million.
The Debtor hired Bill Maloney of Bill Maloney Consulting, as chief
restructuring officer; and Wells Houser & Schatzel, P.A., as
certified public accountant.
ABERCROMBIE & FITCH: S&P Alters Outlook to Stable & Affirms BB- CCR
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Ohio-based specialty apparel retailer Abercrombie & Fitch Co. has
reported steady improvement at the Abercrombie brand in fiscal
2017, while maintaining consistently solid operating performance at
Hollister over that time period.
S&P Global Ratings revised the outlook on Ohio-based apparel
retailer Abercrombie & Fitch Co. to stable from negative. At the
same time, S&P affirmed the 'BB-' corporate credit rating on the
company.
S&P said, "We also affirmed our 'BB+' issue-level rating on its
asset-backed lending (ABL) revolver and our 'BB' issue-level rating
on its term loan. The recovery rating on the ABL revolver remains
'1', reflecting our expectation for very high (90%-100%; rounded
estimate: 95%) recovery in the event of a payment default. The
recovery rating on the term loan remains '2', reflecting our
expectation for substantial (70%-90%; rounded estimate: 70%)
recovery in the event of payment default.
"The rating action reflects our view that operating performance at
the Abercrombie & Fitch brand (which represents a little over 40%
of sales) has generally stabilized and the brand repositioning
efforts are gaining traction, although there is uncertainty whether
good performance at the brand is sustainable in the long term. In
addition, the Hollister brand (which makes up the balance of sales)
has consistently outperformed the industry because of its on-point
merchandising and successful loyalty program, which has increased
the size and frequency of customer transactions. Credit metrics
also improved following the most recent quarter, with debt to
EBITDA now in the low-4x area.
"The stable outlook reflects the consistent and meaningful
improvement in performance at Abercrombie in fiscal 2017, and
continued solid performance at Hollister. While we expect the
specialty apparel environment to remain difficult, we forecast
positive trends at Abercrombie & Fitch Co. to continue in 2018 as
Hollister further leverages its successful loyalty program and
on-point merchandising, and Abercrombie continues to gain traction
on its brand repositioning efforts. We forecast debt to EBITDA will
be in the low-4x area and FFO to total debt about 17% at year-end
2018.
"We could lower the rating in the next year if the company cannot
maintain recent momentum in the repositioning of the Abercrombie &
Fitch brand, or if there is a significant reversal of recent good
operating trends at Hollister because of merchandise missteps or
lower consumer spending on discretionary items. Under this
scenario, debt to EBITDA would weaken to around 5x. This could
happen if sales decline in the low-single-digit percentage in 2018
(compared with our forecast of a low-single-digit growth), and
gross margin contracts 175 bps below our base-case forecast.
"We could raise the rating if the company maintains recent positive
performance trends at the Abercrombie & Fitch brand, while
maintaining solid performance at Hollister, demonstrating a
track-record of consistent positive operating performance with
limited volatility. This would lead to improved traffic trends and
decreased promotional activity, resulting in adjusted EBITDA margin
approaching 20%. Under this scenario, we could also expect the
company to maintain debt to EBITDA below the 4x and the company's
financial policy supports this trend."
ALAMO TOWERS: Wants Exclusive Plan Filing Deadline Moved to May 16
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Alamo Towers - Cotter, LLC, asks the U.S. Bankruptcy Court for the
Western District of Texas to extend the exclusive periods during
which only the Debtor can file a plan of reorganization and solicit
acceptances of the plan through and including May 16, 2018, and
July 16, 2018, respectively.
The Debtors' initial Exclusive Filing Period and Exclusive
Solicitation Period are currently set to expire on March 6, 2018,
and May 6, 2018, respectively.
The Debtor tells the Court that cause exists to extend the
exclusivity date in this case for these reasons:
A. the Debtor filed this case in good faith to prevent the
foreclosure of LNR Partners, LLC's security interest and
the loss of significant equity in the Alamo Towers
properties. The Debtor has been working with LNR on the
use of cash collateral to continue operating the building
until the closing of a sale occurs. Further, the Debtor
has commenced making monthly interest payments on its loan
with LNR as contemplated by 11 U.S.C. Section 362(d)(3),
and believes it can continue to do so until the properties
are sold. According to the Debtor's schedules, the
secured lender MF-CFC 2007-7 NE Loop 410, LLC c/o LNR, was
believed to be owed approximately $10,698,178.83 as of the
filing date. The ad valorem property taxes assessed
against the properties are current. In addition, the
Debtor lists $120,000.54 due to mechanic's lien claimants
and judgment holders, and $177,920.81 to unsecured
creditors (both priority and general unsecured);
B. Cushman & Wakefield U.S., Inc., has recently commenced the
marketing process and there has been interest in the Alamo
Towers properties from various buyers. C&W anticipates a
brief marketing period where highest and best offers for
the properties would be due between mid and late April.
Once that process is completed, the Debtor's
representative and counsel will be in a better position to
assess the amount of the net sales proceeds that would be
available to satisfy creditors in this case. This
information is important in determining whether or not any
creditors will be impaired by the Plan, and would greatly
streamline the confirmation process. The Debtor filed
this case seeking to reorganize its debts under Chapter 11
of the U.S. Bankruptcy Code through a liquidating plan.
The Debtor has filed an application to employ C&W as real
estate broker to represent it in connection with the sale
of the Alamo Towers properties. C&W has commenced the
marketing process for the properties. The Debtor's
counsel spoke with the listing brokers from C&W and was
advised that there has been interest in the Alamo Towers
properties from various buyers. C&W anticipates a brief
marketing period where highest and best offers for the
properties would be due between mid and late April. Once
that process is completed, the Debtor's representative and
counsel will be in a better position to assess the amount
of the net sales proceeds that would be available to
satisfy creditors in this case;
C. the extension is not sought for purposes of delay. The
Debtor continues to pay its obligations, post-petition, as
they become due;
D. the Debtor has reasonable prospects for filing and
obtaining confirmation of a viable plan in this case.
Based upon a recent appraisal, there is sufficient equity
in the property to pay off creditors who may hold allowed
claims in this case with funds remaining to be
administered for the benefit of the heir of the Estate of
James F. Cotter;
E. the Debtor is not using an extension of the exclusivity
period as a means to pressure creditors to submit to the
debtor's reorganization demands. To the contrary, Debtor
is seeking the extension for the purpose of negotiating a
sale of the properties that maximizes the value to all
parties-in-interest; and
F. the Debtor has requested no prior extensions of the
exclusivity deadlines in this case.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/txwb17-52599-40.pdf
About Alamo Towers - Cotter
Alamo Towers - Cotter, LLC, owns an eight-story low-rise building
in San Antonio, Texas. Located in the heart of the north central
office market, Alamo Towers is centrally accessible to all key
activities in the city. The 198,452 sq. ft. facility features easy
access to San Antonio's major highways, panoramic views and ample
parking space.
Alamo Towers - Cotter filed a Chapter 11 petition (Bankr. W.D. Tex.
Case No. 17-52599) on Nov. 6, 2017. In the petition signed by
Marcus P. Rogers, as Ind. Adm. of the Est. of James F. Cotter,
Dec'd, the Debtor estimated assets and liabilities at $10 million
to $50 million each.
The case is assigned to Judge Craig A. Gargotta.
The Debtor is represented by Anthony H. Hervol, Esq., of the Law
Office of Anthony H. Hervol.
No trustee or examiner has been appointed in the Debtor's Chapter
11 case.
ALL AMERICAN: U.S. Trustee Unable to Appoint Committee
------------------------------------------------------
The Office of the U.S. Trustee on March 6 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of All American Readers, Inc.,
About All American Readers
Based in Saint Louis Park, Minnesota, All American Readers, Inc.,
filed a Chapter 11 petition (Bankr. D. Minn. Case No. 18-40308) on
Feb. 1, 2018, estimating under $1 million in both assets and
liabilities. Judge Katherine A. Constantine presides over the
case. The Debtor's counsel is Chad A. Kelsch, Esq. at Fuller,
Seaver, Swanson & Kelsch, P.A.
B N EMPIRE: Wants to Maintain Plan Exclusivity Through May 4
------------------------------------------------------------
B N Empire, LLC, asks the U.S. Bankruptcy Court for the Middle
District of Florida to extend the Debtor's exclusivity period to
file a Chapter 11 Plan to May 4, 2018, as well as the exclusivity
period to confirm a Chapter 11 Plan to July 2, 2018.
The Debtor timely filed its Chapter 11 Plan of Reorganization and
Disclosure Statement on Dec. 29, 2017. The Court conditionally
approved the Disclosure Statement and scheduled the confirmation
hearing for Feb. 22, 2018.
On Jan. 4, 2018, the Court granted the Debtor's Motion to Extend
Exclusivity extending the Debtor's exclusivity period pursuant to
1121(b) to March 5, 2018 and pursuant to Section 1121(c)(3) to May
1, 2018. However, Sherwood Forest of Temple Terrace, Inc. filed a
Motion for Reconsideration and Relief from Order Granting Motion to
Extend Exclusivity Period, which the Court granted in part.
Consequently, the Order Extending Exclusivity was vacated and the
Motion to Extend Exclusivity was scheduled for a hearing on
February 22, 2018 at 11:00 a.m.
On Feb. 12, 2018, Sherwood Forest of Temple Terrace, Inc.,
transferred its claim to Y & M Tampa 18, LLC. Y & M is now the
mortgage holder encumbering the Debtor's real property and the
Debtor's largest creditor.
The Debtor filed an unopposed Motion to reschedule hearing on the
consolidated hearing on the final approval of the disclosure
statement and confirmation of the Debtor's Plan and extend all
confirmation related deadlines. Consequently, the Court has
rescheduled the confirmation hearing to April 19, 2018 at 10:00
a.m.
Additionally, the Debtor filed a Motion to reschedule hearing on
Motion to Extend Exclusivity, which the Court granted. Now, the
hearing on the Debtor's Motion to Extend Exclusivity has been
scheduled for April 19, 2018 at 10:00 a.m.
Thus, in order to preserve its rights and in an abundance of
caution, the Debtor requests that the Court extend the Debtor's
exclusivity period to file and a Chapter 11 Plan for an additional
60 days through and including May 4, 2018 and July 2, 2018,
respectively.
About B N Empire
B N Empire, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
M.D. Fla. Case No. 17-07841) on Sept. 5, 2017. In its petition
signed by Rajesh Bahl, its manager, the Debtor estimated $1 million
to $10 million in assets and $1 million to $10 million in
liabilities. Johnson Pope Bokor Ruppel & Burns, LLP, is the
Debtor's counsel.
BEERCO LIMITED: Taps Goldberg Weprin as Bankruptcy Counsel
----------------------------------------------------------
BeerCo Limited LLC seeks authority from the U.S. Bankruptcy Court
for the Southern District of New York to employ Goldberg Weprin
Finkel Goldstein LLP as bankruptcy counsel.
Services to be provided are:
a. provide the Debtor with necessary legal advice in
connection with the operation and rehabilitation of its restaurant
business during the Chapter 11 case and its responsibilities and
duties as a debtor-in-possession;
b. represent the Debtor in all proceedings before the
Bankruptcy Court and/or the United States Trustee;
c. review and prepare all necessary legal papers, petitions,
orders, applications, motions, reports and plan documents of the
Debtor's behalf;
d. assist the Debtor in negotiations with its landlord or to
take necessary action towards a potential sale of the restaurant;
e. perform all other legal services for the Debtor which may
be necessary to obtain a successful conclusion of the Chapter 11
case, including resolution of claims with the franchiser.
Kevin J. Nash, member of Goldberg Weprin Finkel Goldstein LLP,
attests that neither he nor any member of his firm holds an
interest that would disqualify his firm from re representing the
Debtor in connection with this Chapter 11 case.
The firm's current billing rates for bankruptcy and real estate
matters are $575.00 per hour for partner time, and between $275.00
to $425.00 for associate time.
The counsel can be reached through:
Kevin J. Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
1501 Broadway, 22nd Floor
New York, NY 10036
Phone: 212-221-5700
Fax: 212-730-4518
About BeerCo Limited
BeerCo Limited LLC is a Nevada limited liability company which
operates a "Belgian Beer Cafe" style restaurant with a seating
capacity of 245 patrons. The Restaurant operates at 220 Fifth
Avenue, New York, NY pursuant to a commercial lease and a franchise
and co-operation agreement with a Belgian-based company known as
Creneua International NV, located in Hasselt, Belgium.
On Jan. 22, 2018, BeerCo sought Chapter 11 protection (Bankr.
S.D.N.Y. Case No. 18-10150). The Debtor disclosed total assets of
$2.18 million and total liabilities of $420,588. The Hon. James L.
Garrity Jr. is the case judge. GOLDBERG WEPRIN FINKEL GOLDSTEIN
LLP is the Debtor's counsel.
BLACKMAN COMMUNITY: Taps Jason Shirey as Real Estate Appraiser
--------------------------------------------------------------
Blackman Community Water System Inc. received approval from the
U.S. Bankruptcy Court for the Northern District of Florida to hire
Jason Shirey, a real estate appraiser in Florida.
Mr. Shirey will conduct a valuation of the Debtor's real property
that is collateral securing its debt. He will charge $250 per hour
for his services.
In a court filing, Mr. Shirey disclosed that he does not hold any
interest adverse to the Debtor's estate.
Mr. Shirey maintains an office at:
Jason Shirey
4507 Furling Lane, Suite 114
Destin, FL 32541
Phone: 850-543-5953
About Blackman Community Water System
Blackman Community Water System Inc. filed a Chapter 11 petition
(Bankr. N.D. Fla. Case No. 16-30031) on Jan. 15, 2016. In the
petition signed by Randall Ward, president, the Debtor disclosed
$5.32 million in assets and $1.96 million in liabilities.
Judge Jerry C. Oldshue Jr. presides over the case.
The Debtor hired Chesser & Barr P.A. as its bankruptcy counsel, and
Carr, Riggs & Ingram, LLC as valuation analyst.
BON-TON STORES: Challenges Noteholders' Credit Bid Rights
---------------------------------------------------------
The Delaware Bankruptcy Court will convene today, March 12, 2018 to
consider the request of The Bon-Ton Stores, Inc., for approval of
sale and bidding procedures.
The Bon-Ton and the official unsecured creditors' committee filed
papers last week urging the bankruptcy court to approve the bidding
procedures, and overrule an objection lodged by an Ad Hoc Committee
of Second Lien Noteholders. They do not want the Noteholders group
to participate in the auction of the assets.
The Debtors said they have consensually resolved -- either in
principle or outright -- all objections to the Bidding Procedures
Motion other than those filed by the Second Lien Noteholders and
certain landlords. With respect to the Unresolved Landlords, the
Debtors have been actively soliciting feedback from those parties
regarding the Revised Bidding Procedures Order and Revised Bidding
Procedures, and will continue to work with such parties prior to
the March 12 scheduled hearing in an effort to reach a consensual
resolution, as the Debtors have done with other landlord
constituents.
As it relates to the Second Lien Noteholders' Objection, the
Debtors said the Second Lien Noteholders seek modifications to the
Bidding Procedures that would (a) prematurely declare in a vacuum
that any potential credit bid they may make will be a "Qualified
Bid," notwithstanding that liens they have on a substantial portion
of the Debtors' assets are avoidable, and (b) constrain the
Debtors' intentionally flexible Bidding Procedures in a variety of
ways. These modifications, the Debtors argue, likely could
diminish, rather than maximize, the value of the Debtors' estates
and, therefore, should not be adopted.
The Second Lien Noteholders have indicated they have been involved
in discussions with Great American Group, LLC about the possibility
of submitting a joint bid. The Debtors understand that such a bid
-- Joint GA/2L Bid -- would be a joint liquidating bid for
substantially all of the assets, whereby Great American purportedly
would provide cash in an amount sufficient to repay the DIP Loan in
full and the Second Lien Noteholders would credit bid up to the
$350 million face amount of their claims to "top up" the Joint
GA/2L Bid.
According to the Debtors, the Second Lien Noteholders want the
Court to determine now that any credit bid made by them is a
"Qualified Bid" under the Bidding Procedures -- before the Joint
GA/2L Bid has even been made and the auction has even started, and
in disregard of the limitations on credit bidding set forth in
section 363(k) of the Bankruptcy Code. Although a portion of their
liens in the assets may be avoidable, the Noteholders imply that
they have valid, perfected, unavoidable liens in substantially all
of the Debtors' assets.
"Such a suggestion is misleading," the Debtors argue. "To the
contrary, the Second Lien Noteholders' liens on a material portion
of the Debtors' personal property (i.e., accounts receivable,
inventory, etc.) are subject to avoidance. In particular, the
Debtors believe that the Second Lien Noteholders' financing
statements with respect to three Debtors who own the vast majority
of the Debtors' personal property lapsed prepetition."
"Similarly, the Second Lien Noteholders also did not have a valid
mortgage on one of the Debtors' distribution centers. When the
Second Lien Noteholders became aware of these defects in their
collateral position, they asked the Debtors to file new financing
statements and record a mortgage on their behalf shortly before the
Petition Date, which the Debtors did. As a result, while the Second
Lien Noteholders may have had valid, perfected liens on
substantially all of the Debtors' assets as of the Petition Date,
the perfection of those liens on a substantial portion of the
Debtors' assets was preferential, and, accordingly, the liens are
avoidable.
"In this context, no grounds exist to anoint any hypothetical
credit bid by the Second Lien Noteholders in a vacuum at this time
as an unfettered 'Qualified Bid' under the Bidding Procedures. The
Second Lien Noteholders' assurance that their credit bid would be
only with respect to those assets on which they have 'valid,
perfected and unavoidable liens' does not solve the problem
because, among other things, it fails to address how the credit bid
would be allocated in the context of any actual bid. If a secured
"creditor's lien reaches only some of the property to be sold, the
creditor cannot credit bid the secured claim for the unencumbered
property but must pay cash. How much the creditor must pay depends
on the relative value of the encumbered and unencumbered
property."
The Unsecured Creditors Committee on Thursday said the Debtors'
request should be granted to the extent the Bid Procedures are
modified in the form approved by the Committee and as agreed by the
Debtors. The Committee believes that the Modified Bid Procedures
proposed in the Sale Motion are fair, reasonable and will serve to
maximize value.
The Committee reminds the Court that it is the statutory fiduciary
for approximately 14,000 men and women, and hundreds of landlords
and vendors, and its goal is to see Bon-Ton continue as a going
concern so that the employees have jobs, the vendors have a
customer and the landlords have a tenant.
"This is inapposite to the goals of the Ad Hoc Committee of Second
Lien Noteholders, which sought to convince this court at the first
day hearings that the Debtors would be better off liquidating. The
Noteholders sought to push the company into liquidation by
objecting to routine first day relief that sought the payment of
taxes, wages and vendors, which are so desperately needed for the
continued operations of any retail business. They were
unsuccessful," the Committee recounts.
"Now the Noteholders in their limited objection to the Sale Motion
continue in their attempt to push these cases to a full chain
liquidation. The Noteholders seek to impose unnecessary and rigid
restrictions on the sale and auction process that serve only to
chill bidding, make no economic sense for the estates, and are
detrimental to the interests of all creditors, except arguably the
Noteholders themselves (and that certainly is not clear, especially
since the liens of the Noteholders are defective)."
The Committee agrees with the Debtors that the Noteholders do not
have an absolute statutory right to credit bid.
"The statute is clear that credit bid rights are not absolute; they
may be limited by order of the Bankruptcy Court, for cause," the
panel says.
The Committee also reminds the Court that, while the Debtors have
stipulated to the validity of the Noteholders' secured claims, the
Noteholders' claims are under investigation by the Committee who
has the right to seek standing to challenge the Debtors'
stipulations until April 16, 2018, which will not have passed by
the currently scheduled Auction date.
"The Noteholders have already acknowledged that certain of their
liens lapsed prepetition and that they hold alleged secured claims
(subject to further investigation) as against only a portion of the
Debtors' assets," the Committee continues. "Based on the
Committee's preliminary investigation, the Noteholders' collateral
(upon information and belief) represents approximately 15% of the
Debtors' overall value, or stated differently, based on the
Committee's preliminary investigation it appears that 85% of the
Debtors' value is contained in the three entities that the
Noteholders' security interest lapsed. If there was ever a case
not to prejudge the validity of a purported secured creditors'
liens, this is it, and the validity of the Noteholders' alleged
secured claims should not be pre-judged by giving them an absolute
right to credit bid, particularly when the Committee will be
seeking standing to challenge their claims prior to the
Challenge Deadline."
According to the Committee, by allowing Noteholders to credit bid
the full face amount of their claim as against the Limited
Noteholder Collateral and using price as a primary criterion for
determining the highest and best bid, Noteholders can force a
piecemeal liquidation and freeze out any going concern sale of the
Debtors' Assets.
"This is value destructive and chilling," the Committee says.
The Committee also asserts that Bankruptcy Courts have broad
discretion and flexibility to determine the successful bidder at an
auction. Where bids are complex and the determination of which is
the highest or best bid is not always clear, courts must consider
other factors than price alone.
The Committee is represented by:
Bradford J. Sandler, Esq.
Jeffrey N. Pomerantz, Esq.
Robert J. Feinstein, Esq.
Bradford J. Sandler, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
919 North Market Street, 17th Floor
P.O. Box 8705
Wilmington, DE 19899
Telephone: 302-652-4100
Facsimile: 302-652-4400
E-mail: jpomerantz@pszjlaw.com
E-mail: rfeinstein@pszjlaw.com
bsandler@pszjlaw.com
BON-TON STORES: Noteholders Defend Credit Bid Rights
----------------------------------------------------
The Second Lien Noteholders tell the Bankruptcy Court that The
Bon-Ton Stores has, for the first time, raised an objection to the
Noteholders' right to credit bid, asserting several arguments as to
why "cause" exists to deny such right. The Debtors' primary (if
not sole) basis for disputing the Second Lien Noteholders' right to
credit bid is their contention that the Second Lien Noteholders'
liens as to the personal property assets of three of the Debtors
are disputed, and that the value of those assets is "material" and
"substantial." According to the Debtors, the fact that the Second
Lien Noteholders' liens as to these three Debtors have been
disputed apparently demonstrates sufficient "cause" to prevent the
Second Lien Noteholders from credit bidding for any of the assets
of any of the Debtors, including the seven for whom there is no
dispute as to the validity of their liens on personal property, or
the real estate on which they have mortgage liens that are
undisputed.
"The Debtors are wrong," the Second Lien Noteholders assert.
The Second Lien Noteholders clarify that they requested that the
Bidding Procedures be amended to properly reflect their statutory
right as well as their Collateral Agent's to submit a credit bid,
whether separately or pursuant to a joint bid. As made clear in
that Limited Objection, they only seek to credit bid on assets as
to which there is no dispute as to the validity, perfection, or
avoidability of the lien. These assets include the personal
property of seven of the ten Debtors, as well as real estate
properties owned by the Debtors (with one exception).
As set forth in their Limited Objection and supporting declaration,
the Second Lien Noteholders claim they have uncontested, perfected
security interests in the personal property of seven of the
Debtors:
(a) Carson Pirie Scott II, Inc.;
(b) Bon-Ton Distribution, LLC;
(c) BonStores Realty One, LLC;
(d) BonStores Realty Two, LLC;
(e) BonStores Holdings One, LLC;
(f) BonStores Holdings Two, LLC; and
(g) the Bon-Ton Giftco, LLC.
They also assert that they have valid, perfected, unavoidable liens
on all of the Debtors' real property with one exception for a
distribution center in Illinois.
The Second Lien Noteholders point out that the Debtors do not
contest the validity of these liens or argue that they are somehow
avoidable.
The Noteholders, citing Cohen v. KB Mezzanine Fund II, LP (In re
SubMicron Sys. Corp.), 432 F.3d 448, 459–60 (3d Cir. 2006), also
argue that the Debtors now ignore well settled law in the Third
Circuit -- which was recognized in their own Sale Motion -- which
make clear that the amount of a credit bid is not limited by the
"value" of property subject to the liens. Rather, as held by the
Third Circuit, a credit bid can be as much as the "full face value
of the secured claims," without regard to the underlying economic
value of the assets.
They also point out that the Debtors have agreed that other secured
parties who have liens on individual assets are entitled to credit
bid -- for example, two of the landlords who serve on the Unsecured
Creditors Committee, GGP Limited Partnership and Washington Prime
Group, Inc. -- but are now seeking to change their own rules to
deprive the Second Lien Noteholders of their statutory right to
credit bid.
The Second Lien Noteholders and a nationally known liquidator,
Great American Group, LLC, have submitted a term sheet to the
Debtors, under which they would jointly agree to purchase
substantially all of the Debtors' assets, with payment in the form
of a combination of:
a) cash in an amount sufficient to repay the DIP Lenders
in full (an amount estimated to be in excess of
$500 million) and fund winddown costs not to exceed
$60 million;
b) a credit bid by the Second Lien Noteholders, in the
amount of $100 million, on the assets where their liens
are neither subject to dispute or avoidance.
"In effect, the cash portion of the payment in excess of the $560
million to satisfy the DIP Lenders and cover winddown costs will be
applied to assets where the Second Lien Noteholders do not have
valid, perfected liens or where their liens are subject to bona
fide dispute, and the credit bid will be applied solely to assets
where there are valid, perfected liens and no such bona fide
dispute exists," the Noteholders explain.
Great American is affiliated with one of the Second Lien
Noteholders, B. Riley FBR, Inc., which holds $10.7 million of the
Second Lien Notes.
The Second Lien Noteholders deny that their valid, perfected liens,
including their liens on personal property of The Bon-Ton Stores,
Inc., The Bon-Ton Department Stores, Inc., and McRIL, LLC, are
subject to avoidance under chapter 5 of the Bankruptcy Code.
"That question need not be addressed here, however, given that the
Second Lien Noteholders are only seeking the right to credit bid on
assets as to which there is no dispute as to validity, perfection
and avoidability," they add.
The Second Lien Noteholders are funds and accounts managed or
advised by these institutions:
1. Alden Global, LLC;
2. B. Riley FBR, Inc.;
3. Brigade Capital Management, LP;
4. Cetus Capital, LCC;
5. Contrarian Capital; and
6. Wolverine Asset Management, LLC
The Second Lien Noteholders are the beneficial holders of
$251,352,000 in principal amount of 8.00% Second Lien Senior
Secured Notes Due 2021, of which $350 million in principal amount
were issued by The Bon-Ton Department Stores, Inc., pursuant to an
Indenture dated as of May 28, 2013, among (a) The Bon-Ton
Department Stores, Inc., as issuer, (b) Wells Fargo Bank, N.A. as
trustee and collateral agent, and (c) the guarantors party thereto.
Wells Fargo Bank, National Association is the original indenture
trustee and collateral agent. Wilmington Savings Fund Society, FSB
is the successor indenture trustee and collateral agent.
Attorneys for the Second Lien Noteholders:
COLE SCHOTZ P.C.
Katherine M. Devanney, Esq.
Norman L. Pernick, Esq.
J. Kate Stickles, Esq.
500 Delaware Avenue, Suite 1410
Wilmington, Delaware 19801
Telephone: (302) 652-3131
Facsimile: (302) 652-3117
E-mail: npernick@coleschotz.com
kstickles@coleschotz.com
kdevanney@coleschotz.com
- and -
Sidney P. Levinson, Esq.
Genna L. Ghaul, Esq.
Charles S. Wittmann-Todd, Esq.
JONES DAY
250 Vesey Street
New York, New York 10281
Telephone: (212) 326-3939
Facsimile: (212) 755-7306
E-mail: slevinson@jonesday.com
gghaul@jonesday.com
cwittmanntodd@jonesday.com
- and -
Bruce Bennett, Esq.
Joshua M. Mester, Esq.
JONES DAY
555 South Flower Street, Fiftieth Floor
Los Angeles, CA 90071
Telephone: (213) 489-3939
Facsimile: (213) 243-2539
E-mail: bbennett@jonesday.com
jmester@jonesday.com
BOSSLER ROOFING: Seeks July 10 Exclusive Plan Period Extension
--------------------------------------------------------------
Bossler Roofing, Inc., asks the U.S. Bankruptcy Court for the
Southern District of Florida to extend the Debtor's exclusive
period to file a plan of reorganization through and including July
10, 2018, as well as the exclusive period to solicit acceptances of
its plan of reorganization for 60 days thereafter, or Sept. 10,
2018.
Currently, the exclusive filing period expires on April 11, 2018.
But the deadline for creditors in this case to file proofs of
claims is April 9, 2018. Accordingly, the Debtor requests that the
exclusivity deadline be extended so all claims be filed prior to
Debtor being required to propose a Plan of Reorganization.
The Debtor is not seeking this extension to delay the
administration of the case or to pressure creditors to accept an
unsatisfactory plan. To the contrary, the requested extension to
the Exclusive Periods will permit the Debtor to move forward in an
orderly, efficient and cost-effective manner to maximize the value
of the Debtor's assets. Thus, the Debtor does not believe that any
creditors or parties in interest will be prejudiced by this
extension.
About Bossler Roofing
Bossler Roofing, Inc., is a Lake Worth, Florida-based roofing
company owned by Christopher Bossler. The company offers
installation services of all roofing systems, concrete roof tile
restoration, attic radiant and reflective roof coating energy
saving applications, concrete tile and asphalt shingle "Cool Roof"
energy star installations, Henry Roof Certified waterproofing (flat
roof installation) services, Poly-Foam Certified (Metro-Dade County
approved concrete and clay roof tile adhesive application)
installations, and all commercial and residential roof repairs,
from minor to major leak penetrations.
Bossler Roofing, Inc., filed a Chapter 11 petition (Bankr. S.D.
Fla. Case No. 17-24798) on Dec. 12, 2017. In the petition signed
by Christopher Bossler, its president, the Debtor disclosed
$567,055 in assets and $1.06 million in liabilities. This case is
assigned to Judge Paul G. Hyman, Jr. Craig I. Kelley, Esq. at
Kelley & Fulton, P.L., is the Debtor's general counsel.
BTH QUITMAN: May Obtain Unsecured DIP Financing From Heetway
------------------------------------------------------------
The Hon. Bruce T. Beesley of the U.S. Bankruptcy Court for the
District of Nevada has entered an order denying in part and
granting in part BTH Quitman Hickory LLC's request for
authorization to obtain post-petition financing.
The Debtor is authorized to obtain unsecured post-petition
financing from Heetway Inc. in form of a multi-draw credit line in
an amount not to exceed $156,973. The Post-Petition Lender is
granted an administrative expense claim in an amount equal to the
total of all of the Debtor's draws against the DIP Loan.
All indemnification provisions related to the DIP Bridge Loan will
be eliminated from the terms of the DIP Loan.
As reported by the Troubled Company Reporter on Dec. 20, 2017, the
Debtor sought the Court's permission to obtain from Heetway a
non-amortizing multiple draw super-priority bridge loan facility in
an aggregate principal amount not to exceed $350,000, of which
$156,973 is in the form of new money funding and refinance and roll
up of a protective prepetition secured loan to the Debtor since
Aug. 1, 2017, of $193,027, which funds were used to protect and
preserve the assets of the Debtor, including the payment of
casualty insurance, payroll, security guard service and utilities.
A copy of the court order is available at:
http://bankrupt.com/misc/nvb17-51375-63.pdf
About BTH Quitman Hickory
BTH Quitman Hickory LLC, based in Quitman, Mississippi, is a
privately held provider of torrefied wood pellets designed to offer
pellets of varying energy content to meet the diverse needs of
potential buyers. The company's wood pellets focuses on innovative
and renewable energy source that can be produced on a commercial
scale, enabling businesses to meet the needs of the present without
compromising the ability of future generations to meet their own
needs. BTH Quitman Hickory LLC operates as a subsidiary of New
Biomass Holding LLC.
BTH Quitman Hickory filed for Chapter 11 bankruptcy protection on
(Bankr. D. Nev. Case No. 17-51375) on Dec. 10, 2017, listing $4.22
million in total assets and $59.46 million in total liabilities.
The petition was signed by Neal Smaler, president of managing
member BTH Quitman, LLC.
Judge Bruce T. Beesley presides over the case.
Kevin A. Darby, Esq., at Darby Law Practice, serves as the Debtor's
bankruptcy counsel.
BUANNO TRANSPORT: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Buanno Transport Company, Inc.
dba BTA
151 Riverside Drive
Fultonville, NY 12072
Business Description: Buanno Transport Company, Inc. is a
privately held trucking company in
Fultonville, New York.
Chapter 11 Petition Date: March 7, 2018
Case No.: 18-60283
Court: United States Bankruptcy Court
Northern District of New York (Utica)
Judge: Hon. Diane Davis
Debtor's Counsel: Stephen J. Waite, Esq.
WAITE & ASSOCIATES, P.C.
199 New Scotland Avenue
Albany, NY 12208
Tel: 518-463-4257
E-mail: swaite@waite-associates.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Peter Buanno, president.
The Debtor failed to incorporate in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at:
https://www.scribd.com/document/373347130/nynb18-60283
CAMBER ENERGY: Signs LOI to Acquire Texas Assets for $250,000
-------------------------------------------------------------
Camber Energy, Inc., has executed a letter of intent in connection
with the acquisition of an asset located in the Texas panhandle for
a purchase price of $250,000. The closing of the transaction is
subject to customary closing conditions.
In the event the transaction closes, the Company will acquire
approximately 500 net leasehold acres in Hutchinson County, Texas,
including 49 non-producing well bores. The acquisition also
includes five saltwater disposal wells and the required
infrastructure and equipment necessary to support future
hydrocarbon production.
Camber is evaluating hydrocarbon production opportunities across
all of the to-be acquired acreage including the existing
non-producing well bores for workover opportunities. The Company
plans to begin the process of reestablishing production from some
of the non-producing well bores in the weeks following the
closing.
Richard N. Azar II, the CEO of Camber noted that "This acquisition
will provide opportunities for the Company to increase its reserve
base and cash flows. We estimate that production from some of the
non-producing well bores will be restored within a few weeks of
closing."
Mr. Azar continued, "This is all part of Camber's plan to add
similar acquisitions intended to provide an inventory of lower risk
opportunities which increase both our reserve base and cash flow."
The Company also reports that on March 2, 2018, the institutional
investor which agreed to purchase $16 million of Series C Preferred
Stock from the Company in October 2017 (of which $6 million has
been sold to date), entered into an agreement with the Company
whereby the investor agreed that the discount to the volume
weighted average trading price calculation associated with the
Company's common stock, which ties into the conversion price of the
conversion premium of such preferred stock, would remain at $0.05
per share (unless a trigger event has occurred in connection
therewith as described in the designation of the preferred stock),
notwithstanding the Company's previously announced 1-for-25 reverse
stock split.
About Camber Energy
Based in San Antonio, Texas, Camber Energy (NYSE American: CEI) —
http://www.camber.energy.com/— is an independent oil and natural
gas company based in Houston, Texas with a field office in
Gonzales, Texas. The Company is engaged in the acquisition,
development and sale of crude oil, natural gas and natural gas
liquids from various known productive geological formations,
including from the Hunton formation in Lincoln, Logan and Payne
Counties, in central Oklahoma; the Cline shale and upper Wolfberry
shale in Glasscock County, Texas; and recently in connection with
our entry into the Horizontal San Andres play on the Central Basin
Platform of the Permian Basin in West Texas announced on Jan. 3,
2017. Incorporated in Nevada in December 2003 under the name
Panorama Investments Corp., the Company changed its name to Lucas
Energy, Inc. effective June 9, 2006 and effective Jan. 4, 2017, the
Company changed its name to Camber Energy, Inc.
Camber reported a net loss of $89.12 million on $5.30 million of
total net operating revenues for the year ended March 31, 2017,
compared to a net loss of $25.44 million on $968,146 of total net
operating revenues for the year ended March 31, 2016. As of Dec.
31, 2017, Camber Energy had $18.18 million in total assets, $41.80
million in total liabilities and a total stockholders' deficit of
$23.61 million.
GBH CPAs, PC — http://www.gbhcpas.com/— in Houston, Texas,
issued a "going concern" opinion in its report on the consolidated
financial statements for the year ended March 31, 2017, citing that
the Company has incurred significant losses from operations and had
a working capital deficit at March 31, 2017. These factors raise
substantial doubt about the Company's ability to continue as a
going concern, the auditors said.
CAPITOL SUPPLY: Delays Plan Pursuing Settlement Negotiations
------------------------------------------------------------
Capitol Supply, Inc., asks the U.S. Bankruptcy Court for the
Southern District of Florida for an extension of the Exclusive
Filing Period for a period of 60 days to through and including May
4, 2018, and an extension of the Exclusive Solicitation Period for
a period of 60 days to through and including July 3, 2018.
The Debtor further requests that the Procedures Order Deadline be
extended to through and including May 4, 2018.
The Debtor requests an extension of the Procedures Deadline Order,
Exclusive Filing Period and Exclusive Solicitation Period for a
period of 60 days in order to have additional time to formulate its
plan of reorganization and pursue settlement negotiations with the
United States and Bank of America. The Debtor believes that there
are reasonable prospects for filing a viable plan.
Since the Petition Date, the Debtor has devoted a significant
amount of time:
(a) complying with the requirements of operating as a
debtor-in-possession during a Chapter 11 case,
(b) defending the appeal of the Court's order granting in part
the Debtor's motion to enforce the automatic stay against an action
by the United States and Louis Scutellaro pending before the
District Court for the District of Columbia, including recently
seeking and obtaining permission to file a surreply,
(c) negotiating the sale of the Debtor's interest in certain
agreements and related business divisions with proposed sellers and
the Debtor's secured lender,
(d) obtaining court approval of such sales and related contract
assignments, and
(e) preparing cash budgets for continued use of cash collateral
and projections for a plan of reorganization.
Additionally, the Debtor is in settlement discussions with one of
its largest unsecured creditors, the United States, with respect to
the claims asserted in the DC Case, and with its secured lender,
Bank of America, with respect to potential consensual plan terms.
As a result, the Debtor requires additional time pursue such
settlement discussions with the United States and Bank of America,
and to formulate its plan of reorganization.
About Capitol Supply
Since 1983, Capitol Supply, Inc., has provided the United States
Government, the U.S. Military, State and local government agencies
and consumer and commercial customers worldwide various products
needed to operate their businesses. Capitol Supply offers office
supply, office furniture, hardware, tools, auto parts, cleaning
supplies, dorms and quarters, package room, and GSA schedule
needs.
Capitol Supply was formerly known as Capitol Furniture Distributing
Company and changed its name to Capitol Supply, Inc. in March
2005.
Capitol Supply, based in Boca Raton, Florida, filed a Chapter 11
petition (Bankr. S.D. Fla. Case No. 17-21544) on Sept. 20, 2017.
In the petition signed by CEO Robert J. Steinman, the Debtor
estimated $1 million to $10 million in both assets and liabilities.
The Hon. Erik P. Kimball presides over the case. Bradley S.
Shraiberg, Esq., at Shraiberg Landaue & Page, P.A., serves as
bankruptcy counsel to the Debtor.
CARECENTRIX INC: Moody's Affirms B1 CFR & Alters Outlook to Neg.
----------------------------------------------------------------
Moody's Investors Service affirmed CareCentrix, Inc.'s B1 Corporate
Family Rating (CFR) and B1-PD Probability of Default Rating
following the announced refinancing and dividend transaction.
Moody's also assigned a B1 rating to CareCentrix's proposed first
lien revolver and term loan. The outlook was changed to negative
from stable.
Proceeds from the $570 million term loan and about $38 million in
cash will be used to repay existing debt, pay a $423 million
dividend and cover fees and expenses.
"The debt funded dividend significantly increases leverage with
debt to EBITDA rising to 5.3 times from 1.7 times at September 30,
2017," stated Moody's AVP - Analyst Todd Robinson. "However, the
affirmation reflects the company's strong earnings growth outlook,
favorable industry dynamics, strong track record of business
execution and moderate financial policies," continued Robinson.
Moody's anticipates that adjusted debt to EBITDA will decline
rapidly over the next 12-18 months.
The negative rating outlook reflects minimal cushion at the B1
ratings and the risk that adjusted debt to EBITDA does not decline
as expected. The B1 rating incorporates Moody's expectation that
adjusted debt to EBITDA will decline below 4.5 times over the next
12-18 months. Failure to achieve anticipated levels of growth or
further shareholder dividends would likely lead to rating
pressure.
Rating actions:
CareCentrix, Inc.:
Ratings affirmed:
-- Corporate Family Rating at B1
-- Probability of Default Rating at B1-PD
Ratings assigned:
-- $50 million gtd senior secured first lien revolving credit
facility due 2023 at B1 (LGD4)
-- $570 million gtd senior secured first lien term loan due 2025
at B1 (LGD4)
Ratings affirmed and to be withdrawn upon transaction close:
-- $30 million senior secured first lien revolving credit
facility at B1 (LGD4)
-- $175 million senior secured first lien term loan B at B1
(LGD4)
Outlook Actions:
The rating outlook was changed to negative from stable
RATINGS RATIONALE
CareCentrix's B1 CFR reflects its high leverage, significant
customer concentration and low operating margins. The significant
increase in debt positions the company weakly in the rating
category. Especially given that almost all revenue and profits are
from three customers, with Cigna Corporation (Baa1 stable)
accounting for more than half of the business. However, the rating
is supported by CareCentrix's leading market position, strong
organic growth prospects, high level of revenue visibility and good
liquidity. Moody's also expects that the company will maintain
conservative financial policies with no material debt funded
acquisitions or dividends in the near term.
The ratings could be upgraded if CareCentrix realizes greater
scale, further expansion into the post-acute cost management space
and a significant reduction in customer concentration.
Additionally, the company would have to materially improve its cash
flow and credit metrics.
The ratings could be downgraded if the company in unable to
materially grow earnings or if leverage is expected to remain above
4.5 times over the next 12 to 18 months. A material reduction in
free cash flow or additional debt funded transactions could also
result in a ratings downgrade.
The principal methodology used in these ratings was Business and
Consumer Service Industry published October 2016.
CareCentrix manages post-acute care claims for insurance companies.
The company's service offering includes home health, home infusion,
durable medical equipment, sleep management and care transition.
CareCentrix is owned by Summit Partners and generates about $1.5
billion in revenue.
CAREVIEW COMMUNICATIONS: HealthCor et al Have 41.2% Stake
---------------------------------------------------------
HealthCor Management, L.P., HealthCor Associates, LLC, HealthCor
Hybrid Offshore Master Fund, L.P., HealthCor Hybrid Offshore GP,
LLC, HealthCor Group, LLC, HealthCor Partners Management, L.P.,
HealthCor Partners Management GP, LLC, HealthCor Partners Fund,
L.P., HealthCor Partners L.P., HealthCor Partners GP, LLC, Jeffrey
C. Lightcap, Arthur Cohen, Joseph Healey beneficially own an
aggregate of 97,775,364 shares of common stock of CareView
Communications, Inc., representing:
(i) 5,062,500 shares of Common Stock that may be acquired upon
conversion of the 2018 Notes (including interest payable in
kind through March 31, 2018);
(ii) 8,790,189 shares of Common Stock that may be acquired upon
conversion of the 2015 Notes (including interest paid or
payable in kind through March 31, 2018);
(iii) 20,977,387 shares of Common Stock that may be acquired
upon conversion of the 2014 Notes (including interest paid
or payable in kind through March 31, 2018);
(iv) 8,306,877 shares of Common Stock that may be acquired upon
conversion of the 2012 Notes (including interest paid or
payable in kind through March 31, 2018);
(v) 35,876,643 shares of Common Stock that may be acquired
upon conversion of the 2011 Notes (including interest paid
or payable in kind through March 31, 2018);
(vi) 11,782,859 shares of Common Stock that may be acquired
upon exercise of the 2011 Warrants;
(vii) 4,000,000 shares of Common Stock that may be acquired upon
exercise of the 2014 Warrants;
(viii) 1,916,409 shares of Common Stock that may be acquired upon
exercise of the 2015 Warrants;
(ix) 1,000,000 shares of Common Stock that may be acquired upon
exercise of the Sixth Amendment Warrants; and
(x) 62,500 shares of Common Stock that may be acquired upon
exercise of the 2018 Warrants.
This aggregate amount represents approximately 41.2% of the
Issuer's outstanding common stock, based upon 139,380,748 shares
outstanding, as reported outstanding as of Nov. 9, 2017 in the
Issuer's most recent Quarterly Report on Form 10-Q, and gives
effect to the conversion of all 2011 Notes, 2012 Notes, 2014 Notes,
2015 Notes and 2018 Notes held by the Reporting Persons into Common
Stock and the exercise of all Warrants held by the Reporting
Persons.
Of this amount:
(i) HCP Fund is the beneficial owner of (A) 2,822,646 shares of
Common Stock underlying the current principal amount of the 2015
Note issued to it (including interest paid or payable in kind
through March 31, 2018), (B) 9,771,267 shares of Common Stock
underlying the current principal amount of the 2014 Note issued to
it (including interest paid or payable in kind through March 31,
2018), (C) 3,869,343 shares of Common Stock underlying the current
principal amount of the 2012 Note issued to it (including interest
paid or payable in kind through March 31, 2018), (D) 16,711,340
shares of Common Stock underlying the current principal amount of
the 2011 Note issued to it (including interest paid or payable in
kind through March 31, 2018), (E) 465,800 shares of Common Stock
that it has a right to acquire upon exercise of its Sixth Amendment
Warrant, (F) 615,384 shares of Common Stock that it has a right to
acquire upon exercise of its 2015 Warrant, (G) 1,863,200 shares of
Common Stock that it has a right to acquire upon exercise of its
2014 Warrant and (H) 5,488,456 shares of Common Stock that it has a
right to acquire upon exercise of its 2011 Warrant.
(ii) By virtue of their relationship to HCP Fund, each of HealthCor
Partners, L.P., HCPGP, HealthCor Partners Management, L.P., and
HCPMGP may be deemed to share beneficial ownership with HCP Fund of
the shares of Common Stock beneficially owned by the HCP Fund.
(iii) Hybrid Fund is the beneficial owner of (A) 11,206,120 shares
of Common Stock underlying the current principal amount of the 2014
Note issued to it (including interest paid or payable in kind
through March 31, 2018), (B) 4,437,534 shares of Common Stock
underlying the current principal amount of the 2012 Note issued to
it (including interest paid or payable in kind through March 31,
2018), (C) 19,165,303 shares of Common Stock underlying the current
principal amount of the 2011 Note issued to it (including interest
paid or payable in kind through March 31, 2018), (D) 534,200 shares
of Common Stock that it has a right to acquire upon exercise of its
Sixth Amendment Warrant, (E) 2,136,800 shares of Common Stock that
it has a right to acquire upon exercise of its 2014 Warrant and (F)
6,294,403 shares of Common Stock that it has a right to acquire
upon exercise of its 2011 Warrant.
(iv) By virtue of their relationship to Hybrid Fund, each of
Offshore GP, Group, HealthCor Management, L.P., and Associates may
be deemed to share beneficial ownership with Hybrid Fund of the
shares of Common Stock beneficially owned by the Hybrid Fund.
(v) By virtue of his relationship to HCP Fund, Mr. Lightcap may be
deemed to share beneficial ownership of the shares of Common Stock
beneficially owned by HCP Fund. In addition, Mr. Lightcap is the
beneficial owner of (A) 5,062,500 shares of Common Stock underlying
the current principal amount of the 2018 Note purchased by him
under the Eighth Amendment (including interest payable in kind
through March 31, 2018), (B) 1,975,852 shares of Common Stock
underlying the current principal amount of the 2015 Note purchased
by him under the Fifth Amendment (including interest paid or
payable in kind through March 31, 2018), (C) 62,500 shares of
Common Stock that he has a right to acquire upon exercise of his
2018 Warrant and (D) 430,769 shares of Common Stock that he has a
right to acquire upon exercise of his 2015 Warrant.
(vi) By virtue of his relationship to HCP Fund and Hybrid Fund, Mr.
Cohen may be deemed to share beneficial ownership of the shares of
Common Stock beneficially owned by each of the Funds. In addition,
Mr. Cohen is the beneficial owner of (A) 2,298,103 shares of Common
Stock underlying the current principal amount of the 2015 Note
purchased by him under the Fifth Amendment (including interest paid
or payable in kind through March 31, 2018) and (B) 501,025 shares
of Common Stock that he has a right to acquire upon exercise of his
2015 Warrant.
(vii) By virtue of his relationship to HCP Fund and Hybrid Fund,
Mr. Healey may be deemed to share beneficial ownership of the
shares of Common Stock beneficially owned by each of the Funds. In
addition, Mr. Healey is the beneficial owner of (A) 1,693,588
shares of Common Stock underlying the current principal amount of
the 2015 Note purchased by him under the Fifth Amendment (including
interest paid or payable in kind through March 31, 2018) and (B)
369,231 shares of Common Stock that he has a right to acquire upon
exercise of his 2015 Warrant.
On Feb. 23, 2018, Careview Communications, Mr. Lightcap, and
certain other investors (including the Funds in their capacity as
the Majority Holders approving the transactions and not as
investors) entered into the Eighth Amendment to Note and Warrant
Purchase Agreement, pursuant to which the Company sold and issued,
for an aggregate of $2,050,000 in cash, (i) additional notes in the
aggregate principal amount of $2,050,000, with a conversion price
per share equal to $0.05 (subject to adjustment as described
therein) and a maturity date of Feb. 22, 2028 and (ii) additional
warrants to purchase an aggregate of up to 512,000 shares of Common
Stock at an exercise price per share equal to $0.05 and with an
expiration date of Feb. 23, 2028. Of this amount, Mr. Lightcap
purchased Eighth Amendment Supplemental Notes with an initial
principal amount of $250,000 and Eighth Amendment Supplemental
Warrants to purchase 62,500 shares of Common Stock.
A full-text copy of the regulatory filing is available at:
https://is.gd/Y1F4C8
About CareView Communications
Headquartered in Lewisville, Texas, CareView Communications, Inc.
-- http://www.care-view.com/-- is a provider of products and
on-demand application services for the healthcare industry,
specializing in bedside video monitoring, software tools to improve
hospital communications and operations, and patient education and
entertainment packages. Its proprietary, high-speed data network
system is the next generation of patient care monitoring that
allows real-time bedside and point-of-care video monitoring
designed to improve patient safety and overall hospital costs. The
entertainment packages and patient education enhance the patient's
quality of stay.
CareView reported a net loss of $18.66 million in 2016 following a
net loss of $16.35 million in 2015. As of Sept. 30, 2017, CareView
had $14.32 million in total assets, $71.54 million in total
liabilities, and a total stockholders' deficit of $57.21 million.
CLEVELAND BIOLABS: Alpha Capital Stake Now at 1.77% as of April 20
------------------------------------------------------------------
Alpha Capital Anstalt disclosed in a Schedule 13G/A filed with the
Securities and Exchange Commission that as of April 20, 2017, it
beneficially owns 199,404 shares of common stock of Cleveland
BioLabs, Inc., constituting 1.77 percent based on 11,279,834 shares
outstanding as reported on Form 10-Q for the period ended Sept. 30,
2017. A full-text copy of the regulatory filing is available for
free at https://is.gd/HSODk1
About Cleveland BioLabs
Cleveland BioLabs, Inc. -- http://www.cbiolabs.com/-- is a
biopharmaceutical company developing novel approaches to activate
the immune system and address serious medical needs. The Company's
proprietary platform of Toll-like immune receptor activators has
applications in radiation mitigation, immuno-oncology, and
vaccines. The Company's most advanced product candidate is
entolimod, which is being developed as a medical radiation
countermeasure for the prevention of death from acute radiation
syndrome, an immunotherapy for oncology and other indications. The
Company conducts business in the United States and in the Russian
Federation through a wholly-owned subsidiary, BioLab 612, LLC, and
a joint venture with Joint Stock Company RUSNANO, Panacela Labs,
Inc. The company maintains strategic relationships with the
Cleveland Clinic and Roswell Park Cancer Institute.
Cleveland Biolabs incurred a net loss of $9.84 million in 2017
following a net loss of $2.59 million in 2016. As of Dec. 31,
2017, Cleveland Biolabs had $9.62 million in total assets, $2.22
million in total liabilities and $7.40 million in total
stockholders' equity.
COBALT INTERNATIONAL: Suspends Filing of Reports with SEC
---------------------------------------------------------
Cobalt International Energy, Inc. filed a Form 15 with the
Securities and Exchange Commission notifying the termination of
registration of its common stock, $0.01 par value, under Section
12(g) of the Securities Exchange Act of 1934. As of March 5, 2018,
there were 122 holders of record of Common Shares. As a result of
the Form 15 filing, the Company is not anymore obligated to file
periodic reports with the SEC.
About Cobalt International
Cobalt International Energy -- http://www.cobaltintl.com-- is an
independent exploration and production company active in the
deepwater U.S. Gulf of Mexico and offshore West Africa. Cobalt was
formed in 2005 and is headquartered in Houston, Texas.
Cobalt International Energy, Inc., and five of its subsidiaries
filed voluntary petitions for relief under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 17-36709) on Dec.
14, 2017. In the petitions signed by CFO David D. Powell, the
Debtors reported total assets of $1.69 billion and total debt of
$3.16 billion as of Sept. 30, 2017.
The Debtors tapped Zack A. Clement PLLC as local bankruptcy
counsel; Kirkland & Ellis LLP and Kirkland & Ellis International
LLP as general bankruptcy counsel; Houlihan Lokey Capital, Inc., as
financial advisor and investment banker; Ernst & Young LLP as
auditor; and Kurtzman Carson Consultants LLC as claims and noticing
agent. Baker Botts LLP and Susman Godfrey LLP serve as special
litigation counsel.
An official committee of unsecured creditors was appointed in the
Debtors' cases. Pachulski Stang Ziehl & Jones LLP serves lead
counsel to the Committee; Snow Spence Green LLP as local counsel;
and Conway MacKenzie, Inc., as financial advisor.
COMMUNITY HOME: Trustee Awarded Damages in Suit v. Dickson, et al.
------------------------------------------------------------------
Judge Neil P. Olack of the U.S. Bankruptcy Court for the Southern
District of Mississippi addresses the First Amended Verified
Complaint to recover money, damages or property; to avoid
pre-petition and post-petition transfers; for turnover of property;
for injunctive relief; and for equitable subordination filed by
Kristina M. Johnson, trustee of the estate of Community Home
Financial Services, Inc., the Defendant Reshonda Rhodes' Answer to
First Amended Verified Complaint; and the Answer and Defenses of
Defendants, Discount Mortgage, Inc. et al., and the Answer of
Defendant William D. Dickson.
Upon assessment of the facts and review of the evidence, Judge
Olack finds as follows:
1. Count 1 (Federal RICO): Dickson, but not Rhodes, violated the
Federal RICO Act. The Trustee's Victim Impact Statement submitted
in the Criminal Proceeding on Dec. 8, 2015, reflected approximate
damages to the Estate as of that date in the amount of $16,454,339.
After subtracting credits to Dickson per the Restitution Order in
the amount of $6,703,837.78 and after adding Trustee's fees,
ClearSpring's servicing fees, and other Estate professional fees
and expenses, the Estate has been damaged in the amount of
$13,485,492 as of the date of Trial. Accordingly, the Trustee is
entitled to a judgment against Dickson for the amount of
$13,485,492, trebled, together with post-judgment interest at the
legal rate until satisfied.
2. Count 2 (Mississippi Racketeering Act): Dickson, but not
Rhodes, violated the Mississippi Racketeering Act. As previously
stated, the Trustee's Victim Impact Statement submitted in the
Criminal Proceeding on Dec. 8, 2015, reflected approximate damages
to the Estate as of that date in the amount of $16,454,339. After
subtracting credits to Dickson per the Restitution Order in the
amount of $6,703,837.78 and after adding Trustee's fees,
ClearSpring's servicing fees, and other Estate professional fees
and expenses, the Estate has been damaged in the amount of
$13,485,492 as of the date of the Trial. Accordingly, the Trustee
is entitled to a judgment against Dickson for the amount of
$13,485,492, trebled, together with post-judgment interest at the
legal rate until satisfied.
3. Count 3 (Tortious Interference with Contract): Dickson and
the Corporate Defendants tortiously interfered with CHFS's
contracts with its borrowers. As previously stated, the Trustee's
Victim Impact Statement submitted in the Criminal Proceeding on
Dec. 8, 2015, reflected approximate damages to the Estate as of
that date in the amount of $16,454,339. After subtracting credits
to Dickson per the Restitution Order in the amount of $6,703,837.78
and after adding additional Trustee's fees, ClearSpring's servicing
fees, and additional Estate professional fees and expenses, the
Estate has been damaged in the amount of $13,485,492 as of the date
of the Trial. Accordingly, the Trustee is entitled to a judgment
against Dickson and the Corporate Defendants, jointly and
severally, in the amount of $13,485,492, together with
post-judgment interest at the legal rate until satisfied.
4. Count 4 (Mississippi Fraudulent Transfer Act): Dickson and
the Corporate Defendants fraudulently transferred CHFS's assets.
Accordingly, the Trustee is entitled to a judgment against Dickson
and the Corporate Defendants for the avoidance of the Pre-Petition
Transfers. Similarly, to the extent that the Loan Transfers were
made pre-petition, the Trustee is entitled to avoid those transfers
and to a judgment vesting title in the Estate of all loans
ostensibly in the name of DMI or DHMI.
5. Count 5 (Avoidance of Transfers by Dickson Enterprises): The
Trustee has abandoned Count 5, and, therefore, Count 5 is dismissed
with prejudice.
A full-text copy of Judge Olack's Memorandum Opinion dated Feb. 27,
2018 is available at:
http://bankrupt.com/misc/mssb12-01703-2187.pdf
About Community Home Financial
Community Home Financial is a specialty finance company providing
contractors with financing for their customers. It operated from
one central location providing financing through its dealer network
throughout 25 states, Alabama, Delaware, and Tennessee. On
December 23, 2013, the Debtor changed its principal place of
business to Panama.
The Debtor filed a Chapter 11 petition (Bankr. S.D. Miss. Case No.
12-01703) on May 23, 2012. The petition was signed by William D.
Dickson, president.
The Debtor scheduled $44.9 million in total assets and $30.3
million in total liabilities. Judge Edward Ellington presides over
the case.
The Debtor was first represented by Roy H. Liddell, Esq., and
Jonathan Bissette, Esq., at Wells, Marble, & Hurst, PPLC as Chapter
11 counsel. Wells Marble was terminated Nov. 13, 2013.
The Debtor is now being represented by Derek A. Henderson, Esq., in
Jackson, Mississippi. In 2013, the Debtor sought to employ David
Mullin, Esq., at Mullin Hoard & Brown LLP, as special counsel.
On Jan. 9, 2014, Kristina M. Johnson was appointed as Chapter 11
trustee for the Debtor. Jones Walker LLP serves as counsel to the
trustee, while Stephen Smith, C.P.A., acts as accountant.
CONSTRUCTION MATERIALS: Taps Honey Law Firm as Legal Counsel
------------------------------------------------------------
Construction Materials Testing Services, Inc., seeks approval from
the U.S. Bankruptcy Court for the Western District of Arkansas to
hire Honey Law Firm, P.A., as its legal counsel.
The firm will advise the Debtor regarding the administration of its
estate; investigate and prosecute preference actions; assist in the
preparation of a plan of reorganization; and provide other legal
services related to its Chapter 11 case.
Marc Honey, Esq., and Wm. Marshall Hubbard, Esq., the attorneys who
will be handling the case, will charge $350 per hour and $250 per
hour, respectively.
Mr. Honey disclosed in a court filing that he is a "disinterested
person" as defined in Section 101(14) of the Bankruptcy Code.
Honey Law Firm can be reached through:
Marc Honey, Esq.
Honey Law Firm, P.A.
P.O. Box 1254
Hot Springs, AR 71902
Phone: 501-321-1007
Fax: 501-321-1254
About Construction Materials
Testing Services Inc.
Construction Materials Testing Services, Inc., handles quality
assurance and quality control and related construction services.
Construction Materials Testing Services sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ark. Case No.
17-73174) on Dec. 21, 2017. Judge Ben T. Barry presides over the
case. At the time of the filing, the Debtor estimated assets and
liabilities of less than $50,000.
CORPORATE RESOURCE: Trustee Reaches Deal with Crowe Horwath
-----------------------------------------------------------
BankruptcyData.com reported that the Chapter 11 trustee assigned to
Corporate Resource Services' case filed with the U.S. Bankruptcy
Court a motion to approve a settlement, by and among the Trustee
and Crowe Horwath LLP. The settlement motion explains, "The
Settlement resolves potential claims by the Trustee against Crowe
Horwath that otherwise would have resulted in protracted and costly
litigation. The Trustee believes that the Debtors' estates have
meritorious claims against Crowe Horwath, but Crowe Horwath
strongly denies these claims and has identified numerous defenses
it would assert, and as with any litigation the ultimate outcome is
uncertain. In contrast to the delay, cost, and uncertainty of
litigation, the Settlement represents a favorable alternative for
all parties in interest. The Debtors' estates will recover $2.1
million in the near term and avoid the risk and delay of
litigation. The Parties engaged in extensive negotiations with the
assistance of counsel that culminated in the proposed Settlement.
The Trustee respectfully submits that the Settlement is beneficial
to the Debtors' estates and the creditors, and requests that the
Court approve the Settlement and grant the other relief sough
herein." The Court scheduled a March 27, 2018 hearing with
objections due by March 20, 2018.
About Corporate Resource Services
Corporate Resource Services, Inc., is a provider of corporate
employment and human resource solutions, headquartered in New York.
CRS leases its headquarters and does not own any real property.
About 90% of CRS shares are owned by Robert Cassera and the balance
are traded OTC.
As of Dec. 31, 2014, CRS was one of the largest employment staffing
companies in the U.S., providing employment and human resources
solutions for corporations with annual sales of about one billion
dollars. In February 2015, CRS began an orderly wind down of
operations after discovering that TS Employment, Inc., a privately
held company owned by Mr. Cassera, failed to remit tens of millions
of dollars of the Debtors' withholding taxes to taxing
authorities.
TS Employment Inc., a professional employer organization that
provided payroll-related services for CRS, sought Chapter 11
protection (Bankr. S.D.N.Y. Case No. 15-10243) in Manhattan on Feb.
2, 2015. The case is before Judge Martin Glenn. TSE tapped Scott
S. Markowitz, Esq., at Tarter Krinsky & Drogin LLP, in New York, as
counsel. Realization Services Inc. serves as the Debtor's
consultant.
CRS and its subsidiaries sought Chapter 11 protection (Bankr. D.
Del. Lead Case No. 15-11546) on July 23, 2015, to complete their
orderly wind down of operations. The CRS Debtors' cases were
transferred to New York (Bankr. S.D.N.Y. Lead Case No. 15-12329),
on Aug. 18, 2015, and assigned to Judge Glenn. CRS estimated $10
million to $50 million in assets and $50 million to $100 million in
debt.
The CRS Debtors tapped Gellert Scali Busenkell & Brown, LLC, as
bankruptcy counsel; Wilmer Cutler Pickering Hale & Dorr LLP, as
special counsel; Carter Ledyard & Milburn LLP, as special SEC
counsel; SSG Capital Advisors as financial advisors and investment
bankers; and Rust Omni LLC as claims agent.
James S. Feltman has been appointed as Chapter 11 trustee for the
CRS Debtors and for TS Employment. He has tapped Togut, Segal &
Segal LLP as counsel; and Jenner & Block LLP and Greenberg Traurig,
P.A., as special counsel; Jeffer Mangels Butler & Mitchell LLP, as
special litigation counsel.
CUISINE365 LLC: Taps Demetrius J. Parrish as Legal Counsel
----------------------------------------------------------
Cuisine365, LLC, seeks approval from the U.S. Bankruptcy Court for
the Eastern District of Pennsylvania to hire the Law Office of
Demetrius J. Parrish, Jr., as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; assist in the preparation of a plan of
reorganization; and provide other legal services related to its
Chapter 11 case.
Parrish will charge an hourly fee of $300 for its services. The
firm received a retainer in the sum of $2,000 from the Debtor.
Demetrius Parrish, Jr., Esq., disclosed in a court filing that he
does not represent any interest adverse to the Debtor and its
estate.
The firm can be reached through:
Demetrius J. Parrish, Jr., Esq.
Law Office of Demetrius J. Parrish, Jr.
7715 Crittenden Street, Suite 360
Philadelphia, PA 19118
Tel: (215) 735–3377
Fax: (215) 827-5420
E-mail: djpesq@gmail.com
About Cuisine365 LLC
Cuisine365, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Pa. Case No. 18-11420) on March 1,
2018. Judge Eric L. Frank presides over the case. At the time of
the filing, the Debtor estimated assets and liabilities of less
than $50,000.
CYANCO INTERMEDIATE 2: S&P Lowers Rating on 1st Lien Debt to B
--------------------------------------------------------------
S&P Global Ratings lowered its issue-level and recovery ratings on
Cyanco Intermediate 2 Corp.'s first-lien credit facilities, and
affirmed the ratings on the second-lien debt. The corporate credit
rating is unchanged.
S&P said, "Given the upsizing of the first-lien debt, we lowered
our issue-level rating on the first-lien secured debt to 'B' from
'B+' after revising the recovery rating to '3' from '2'. The '3'
recovery rating indicates our expectation of meaningful (50%-70%;
rounded estimate: 65%) recovery in the event of payment default.
"The issue-level rating on second-lien debt remains 'CCC+' and the
recovery rating remains '6'. The '6' recovery rating indicates our
expectation of negligible (0%-10%; rounded estimate: 5%) recovery
in the event of payment default.
"The rating action reflects our view of Cyanco's plan to increase
its first-lien term loan by $20 million to $400 million, and
decrease the second-lien term loan by $20 million to $80 million.
The re-tranched deal is leverage-neutral compared with the original
proposed transaction; therefore, the 'B' corporate credit rating is
unaffected."
ISSUE RATINGS--RECOVERY ANALYIS
Key analytical factors
-- S&P has revised its recovery analysis to reflect a change in
the proposed capital structure, with $20 million being shifted from
the second-lien to the first-lien term loan.
-- S&P has lowered the issue-level and recovery ratings to 'B' and
'3', respectively, on the proposed first-lien credit facilities,
consisting of a $50 million revolver and $400 million term loan.
The '3' recovery rating indicates S&P's expectation of meaningful
(50% to 70%; rounded estimate: 65%) recovery in the event of a
payment default.
-- S&P has affirmed the 'CCC+' issue-level and '6' recovery
ratings on the proposed $80 million second-lien term loan. The '6'
recovery rating indicates S&P's expectation of negligible (0% to
10%; rounded estimate: 5%) recovery in the event of a payment
default.
-- S&P's simulated default scenario assumes a payment default in
2021, stemming from client attrition, unplanned downtime, and
declining volume amid weak end-market demand, which pressures
margins, working capital, and cash flow.
-- S&P assumes the company seeks covenant amendments on the path
to default, resulting in higher interest costs.
-- To value Cyanco, S&P has applied a 5x multiple to its estimated
post-default emergence EBITDA of $66 million, which results in a
gross enterprise value of $330 million. The 5x multiple is
consistent with that used for other commodity chemical peers such
as Koppers Inc. and Kraton Corp.
Simulated default assumptions
-- Simulated year of default: 2021
-- EBITDA at emergence: $66 million
-- Implied enterprise value (EV) multiple: 5x
Simplified waterfall
-- Net EV (after 5% administrative costs): $313 million
-- Valuation split in % (obligors/nonobligors): 80%/20%
-- Total value available for first-lien secured creditors: $305
million
-- First-lien claims: $447 million
—-Recovery expectation: 50% to 70% (rounded estimate: 65%)
-- Total value available for second lien secured creditors: $8
million
-- Second-lien claims: $84 million
-—Recovery expectation: 0% to 10% (rounded estimate: 5%)
Note: All debt amounts at default include six months accrued
prepetition interest.
Ratings List
Cyanco Intermediate Corp.
Corporate Credit Rating B/Stable
Issue Level Ratings Downgraded; Recovery Rating Revised Cyanco
Intermediate 2 Corp.
To From
Senior Secured B B+
Recovery Rating 3(65%) 2(70%)
Ratings Affirmed; Recovery Expectations Revised
Cyanco Intermediate 2 Corp
Senior Secured CCC+ CCC+
Recovery Rating 6(5%) 6(0%)
CYTOSORBENTS CORP: OKs 129.7K Restricted Stock Units Bonus Awards
-----------------------------------------------------------------
The Compensation Committee of the Board of Directors of
CytoSorbents Corporation approved the following equity bonus awards
for its executive officers:
Bonus
Restricted
Name Position Stock Units
---- -------- -----------
Phillip P. Chan, MD, PhD Pres. and CEO 43,000
Vincent J. Capponi Chief Operating Officer 38,000
Kathleen P. Bloch Chief Financial Officer 34,700
Eric R. Mortensen Chief Medical Officer 14,000
The restricted stock units were awarded in the discretion of the
Compensation Committee in recognition of the Company's 2017
performance. The restricted stock units were granted under the
Company's 2014 Long-Term Incentive Plan and have a 10 year term.
Vesting as to one-third of the restricted stock units will occur on
each of the date of grant, the first anniversary of the date of
grant, and the second anniversary of the date of grant, subject to
the grantee's continued service as of the applicable vesting date,
and will be settled into common stock of the Company, $0.001 par
value per share.
About CytoSorbents
Based in Monmouth Junction, New Jersey, CytoSorbents Corporation is
engaged in critical care immunotherapy commercializing its CytoSorb
blood purification technology to reduce deadly uncontrolled
inflammation in hospitalized patients around the world, with the
goal of preventing or treating multiple organ failure in
life-threatening illnesses. The Company, through its subsidiary
CytoSorbents Medical Inc. (formerly known as CytoSorbents, Inc.),
is engaged in the research, development and commercialization of
medical devices with its blood purification technology platform
which incorporates a proprietary adsorbent, porous polymer
technology.
The Company, through its European subsidiary, conducts sales and
marketing related operations for the CytoSorb device. CytoSorb,
the Company's flagship product, is approved in the European Union
and marketed in and distributed in thirty-two countries around the
world, as a safe and effective extracorporeal cytokine absorber,
designed to reduce the "cytokine storm" that could otherwise cause
massive inflammation, organ failure and death in common critical
illnesses such as sepsis, burn injury, trauma, lung injury, and
pancreatitis. CytoSorb is also being used during and after cardiac
surgery to remove inflammatory mediators, such as cytokines and
free hemoglobin, which can lead to post-operative complications,
including multiple organ failure. In March 2011, the Company
received CE Mark approval for its CytoSorb device.
CytoSorbents recognized a net loss of $11.93 million on $9.52
million of total revenue for the year ended Dec. 31, 2016, compared
to a net loss of $8.13 million on $4.79 million of total revenue
for the year ended Dec. 31, 2015. As of Sept. 30, 2017,
Cytosorbents had $22.21 million in total assets, $12.74 million in
total liabilities and $9.47 million in total stockholders' equity.
WithumSmith+Brown, PC, in New Brunswick, New Jersey, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2016, noting that the
Company has suffered recurring losses from operations and has a net
capital deficiency that raises substantial doubt about its ability
to continue as a going concern.
D&M INVESTMENTS: Sale of Ramada Inn Delays Plan Filing
------------------------------------------------------
D&M Investments, Inc., and MNM Holdings, LLC, ask the U.S.
Bankruptcy Court for the Northern District of West Virginia to
extend the exclusive period to file a plan of reorganization be
extended by 60 days, or until May 2, 2018, and that the exclusive
right to solicit acceptances or rejections to that plan also be
extended by 60 days to July 1, 2018.
The Debtors' exclusive right to file a plan of reorganization
expires on March 3, 2018, and their exclusive right to solicit
acceptances or rejections of any proposed plan expires on May 2,
2018.
The Debtors intend to fund a plan based on the proceeds received
through a Section 363 sale of the Hotel and surrounding properties.
D&M owned and operated a hotel doing business as "The Ramada Inn",
at 20 Scott Avenue, in Morgantown, WV. The Hotel was part of a
Ramada Inn franchise. The Hotel stopped operating on or about June
30, 2017. The Debtors have hired a broker to sell the Hotel and
surrounding properties and will be filing a motion to approve the
bidding procedures for the same in the near future.
The Debtors' retained Equity Partners HG, LLC, on Dec. 12, 2018, as
brokers to market the same exclusively for a 120-day period.
The Debtors will not file a plan until the conclusion of the
Section 363 auction, since a 363 sale is most prudent way to fund a
liquidating plan in these cases.
Since the Petition Date, the Debtors continue to make efforts to
pay bills. This is the first time that the Debtors have sought
extension of the Exclusivity Periods.
The Debtors tell the Court that since the Petition Date, they have
been diligently preparing and filing the necessary forms and
reports for the U.S. Trustee.
The Debtors assure the Court that they do not seek this extension
in order to pressure creditors to submit to a debtor's plan. To
the contrary, the Debtors have been in ongoing open dialogues with
key creditors regarding the progress of the cases and the status of
the impending sale. It is the Debtors' aim to file a liquidating
plan that is fair and hopefully uncontested.
About MNM Holdings and D&M Investments
Based in Morgantown, West Virginia, MNM Holdings LLC, is a small
business debtor as defined in 11 U.S.C. Section 101(51D). The
company is in the real estate leasing business. D&M Investments,
Inc., operates public hotels and motels.
MNM Holdings LLC and D&M Investments, Inc., sought Chapter 11
protection (Bankr. N.D. W.Va. Case No. 17-01104 and 17-01105) on
Nov. 3, 2017. In the petitions signed by Alan B. Mollohan, its
managing member, MNM Holdings and D&M Investments each estimated $1
million to $10 million in both assets and liabilities.
The case is assigned to Hon. Patrick M. Flatley.
Salene Rae Mazur Kraemer, Esq., at Mazurkraemer Business Law, in
Canonsburg, Pennsylvania.
DATA COOLING: Files Chapter 11 Plan of Liquidation
--------------------------------------------------
Data Cooling Technologies, LLC, and Data Cooling Technologies
Canada, LLC, filed a Chapter 11 plan of liquidation and
accompanying disclosure statement proposing to pay general
unsecured creditors a pro rata share of the net proceeds of the
Liquidating Trust Assets.
The disclosure statement explaining the Plan did not specify the
estimated recovery of general unsecured creditors.
The Plan contemplates the liquidation of the Debtors. All of the
Debtors' operations and substantially all of the Debtors' tangible
Assets have already been liquidated and converted to Cash. Upon
Confirmation of the Plan and transfer of the Liquidating Trust
Assets to the Liquidating Trust, the Debtors’ only remaining
Assets will be Cash, Causes of Action (including Avoidance Actions
and Insider Causes of Action), proceeds from the sales of
miscellaneous assets, and any rights to refunds or other contingent
assets.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/ohnb17-52170-260.pdf
About Data Cooling Technologies
Data Cooling Technologies LLC is the exclusive North American
licensee of US Patent No. 7753766. The KyotoCooling patented
solution utilizes a heat wheel and an indirect economization
process to produce the most reliable and efficient cooling
technology in the data center industry.
Based in Streetsboro, Ohio, Data Cooling Technologies LLC and Data
Cooling Technologies Canada LLC filed Chapter 11 petitions (Bankr.
N.D. Ohio Lead Case No. 17-52170) on Sept. 8, 2017. In the
petitions signed by CEO Gregory Gyllstrom, Data Cooling estimated
assets and liabilities at $10 million to $50 million, and Data
Canada estimated assets of less than $50,000 and liabilities of
less than $500,000.
The Hon. Alan M. Koschik presides over the case.
The Debtors tapped McDonald Hopkins LLC, as counsel, and Western
Reserve Partners LLC, as investment banker.
The official committee of unsecured creditors formed in the case
retained Dahl Law LLC as its legal counsel.
DETROIT SERVICE: S&P Cuts 2011 Public School Bonds Rating to 'B'
----------------------------------------------------------------
S&P Global Ratings lowered its long-term rating to 'B' from 'BB-'
on Michigan Finance Authority's series 2011 public school academy
limited obligation revenue and refunding bonds, issued on behalf of
Detroit Service Learning Academy (DSLA). The outlook is stable.
"The lowered rating reflects our view of the academy's refinancing
and liquidity risk with a short timeframe and limited market access
from its unrated, privately placed subordinate bonds," said S&P
Global Ratings credit analyst Kaiti Wang. "The academy had
attempted but failed to refinance this debt in 2016, leaving
substantially less time to resolve the liquidity event risk," Ms.
Wang added.
DLSA was initially chartered as the YMCA Service Learning Academy
by Lake Superior State University (LSSU) in 1999. The academy is
located in northwest Detroit and serves more than 1,400
predominantly underprivileged pre-kindergarten through eighth-grade
students.
DIFFUSION PHARMACEUTICALS: Falls Short of Nasdaq's Bid Price Rule
-----------------------------------------------------------------
Diffusion Pharmaceuticals Inc. received on March 2, 2018, a written
notice from the staff of the Listing Qualifications Department of
The Nasdaq Stock Market, LLC indicating that the Company was not in
compliance with Nasdaq Listing Rule 5550(a)(2) because the bid
price for the Company's common stock had closed below $1.00 per
share for the previous 30 consecutive business days.
In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company
has 180 calendar days from the date of such notice, or until Aug.
29, 2018, to regain compliance with the minimum bid price
requirement. To regain compliance, the bid price for the Company's
common stock must close at $1.00 per share or more for a minimum of
10 consecutive business days.
Nasdaq's written notice has no effect on the listing or trading of
the Company's common stock at this time, and the Company is
currently evaluating its alternatives to resolve this listing
deficiency.
About Diffusion Pharmaceuticals
Based in Charlottesville, Virginia, Diffusion Pharmaceuticals Inc.
– http://www.diffusionpharma.com/— is a clinical-stage
biotechnology company focused on extending the life expectancy of
cancer patients by improving the effectiveness of current
standard-of-care treatments including radiation therapy and
chemotherapy. Diffusion is developing its lead product candidate,
trans sodium crocetinate, for use in the many cancers where tumor
hypoxia (oxygen deprivation) is known to diminish the effectiveness
of SOC treatments. TSC targets the cancer’s hypoxic
micro-environment, re-oxygenating treatment-resistant tissue and
making the cancer cells more vulnerable to the therapeutic effects
of SOC treatments without the apparent occurrence of any serious
side effects.
Diffusion reported a net loss of $18.03 million for the year ended
Dec. 31, 2016, compared to a net loss of $6.71 million for the year
ended Dec. 31, 2015. As of Sept. 30, 2017, the Company had $28.32
million in total assets, $21.97 million in total liabilities and
$6.35 million in total stockholders' equity.
KPMG LLP, in McLean, Virginia, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Dec. 31, 2016, citing that the Company has suffered recurring
losses from operations, has limited resources available to fund
current research and development activities, and will require
substantial additional financing to continue to fund its research
and development activities. These conditions raise substantial
doubt about its ability to continue as a going concern.
DPW HOLDINGS: Buys Additional 1,000 Shares of WSI Industries
------------------------------------------------------------
DPW Holdings, Inc. reported in a Schedule 13D/A filed with the
Securities and Exchange Commission that as of Feb. 27, 2018, it
beneficially owns 260,915 shares of common stock of WSI Industries,
Inc., constituting 8.8% (based on 2,951,676 shares of common stock
outstanding as of Dec. 22, 2017).
DPW Holdings purchased an additional 1,000 shares of the Issuer's
Common Stock in the open market since its Schedule 13D/A filed with
the SEC on Feb. 21, 2018 and therefore presently owns aggregate of
260,915 those shares.
Milton C. Ault III, the chief executive officer of DPW Holdings,
Inc., sent a letter dated Feb. 16, 2018 that arrived on Feb. 20,
2018 to Michael J. Pudil, the chairman and chief executive officer
of the Issuer, which letter sets forth DPW Holdings' intention,
among other items, to commence a tender officer to acquire a
majority of the issued and outstanding shares of Common Stock at
the proposed purchase price of $6.00 per share in cash.
On Feb. 26, 2018, WSI Industries delivered a letter to the
Reporting Person requesting information regarding the Reporting
Person's plans and proposals relating to the Company and its
shareholders. Milton C. Ault III, the chief executive officer of
DPW Holdings, Inc., sent a letter dated March 4, 2018 to Michael J.
Pudil, the chairman and chief executive officer of WSI Industries,
which letter sets forth the detailed response of the Reporting
Person to the Issuer.
Mr. Ault stated in the letter that, "In case my February 16
correspondence was somehow unclear, DPW Holdings, Inc. ("DPW") is
not at this time asking for disinterested committee consideration
and approval for a business combination (as defined under Minnesota
Statutes Section 302A.011) as you suggest in your correspondence.
Rather, as stated in such correspondence and as detailed in
Minnesota Statutes Section 302A.673, DPW is seeking prior approval
of a disinterested committee for its proposed acquisition of shares
of common stock of WSI so that the possibility of a future business
combination with an affiliate of DPW within the next four years
would not be precluded. Given DPW's involvement with many
interesting business opportunities and its interest in driving the
value of WSI higher for WSI shareholders, it would be in the best
interests of WSI to keep open the future possibility for WSI to be
able to engage in a business combination with an affiliate of DPW
during such period, should a circumstance arise where such a
combination would be in the best interests of the shareholders of
WSI. Under Minnesota Statutes Section 302A.673, without prior
approval of our share acquisition in excess of ten percent, such
potentially beneficial opportunities would be foreclosed for four
years."
A copy of the letter from the Reporting Person is available for
free at https://is.gd/RgOPBQ
A full-text copy of the regulatory filing is available at:
https://is.gd/SkbgGR
About DPW Holdings
Headquartered in Fremont, California, DPW Holdings, Inc., formerly
known as Digital Power Corp. -- http://www.DPWHoldings.com-- is a
diversified holding company that, through its wholly owned
subsidiary, Coolisys Technologies, Inc., is dedicated to providing
technology-based solutions where innovation is the main driver for
mission-critical applications and lifesaving services. Coolisys'
growth strategy targets core markets that are characterized by
"high barriers to entry" and include specialized products and
services not likely to be commoditized. Coolisys through its
portfolio companies develops and manufactures cutting-edge resonant
switching power topologies, specialized complex high-frequency
radio frequency (RF) and microwave detector-log video amplifiers,
very high-frequency filters and naval power conversion and
distribution equipment. Coolisys services the defense, aerospace,
medical and industrial sectors and manages four entities including
Digital Power Corporation, www.DigiPwr.com, a leading manufacturer
based in Northern California, 1-877-634-0982; Digital Power Limited
d/b/a Gresham Power Ltd., www.GreshamPower.com, a manufacturer
based in Salisbury, UK.; Microphase Corporation, www.MicroPhase.com
with its headquarters in Shelton, CT 1- 203-866-8000; and
Power-Plus Technical Distributors, www.Power-Plus.com, a wholesale
distributor based in Sonora, CA 1-800-963-0066. Coolisys operates
the branded division, Super Crypto Power,
www.SuperCryptoPower.com.
Digital Power reported a net loss of $1.12 million for the year
ended Dec. 31, 2016, and a net loss of $1.09 million for the year
ended Dec. 31, 2015. As of Sept. 30, 2017, Digital Power had
$18.26 million in total assets, $10.79 million in total liabilities
and $7.46 million in total equity.
"The Company expects to continue to incur losses for the
foreseeable future and needs to raise additional capital to
continue its business development initiatives and to support its
working capital requirements. In March 2017, the Company was
awarded a 3-year, $50 million purchase order by MTIX Ltd. ("MTIX")
to manufacture, install and service the Multiplex Laser Surface
Enhancement ("MLSE") plasma-laser system. Management believes that
the MLSE purchase order will be a source of revenue and generate
significant cash flows for the Company. Management believes that
the Company has access to capital resources through potential
public or private issuance of debt or equity securities. However,
if the Company is unable to raise additional capital, it may be
required to curtail operations and take additional measures to
reduce costs, including reducing its workforce, eliminating outside
consultants and reducing legal fees to conserve its cash in amounts
sufficient to sustain operations and meet its obligations. These
matters raise substantial doubt about the Company's ability to
continue as a going concern," said the Company in its quarterly
report for the period ended Sept. 30, 2017.
ECOARK HOLDINGS: Zest Labs Inks $1.5M Services Pact with Walmart
----------------------------------------------------------------
Zest Labs, an AgTech company modernizing the post-harvest fresh
food supply chain, announced the launch of its professional
services offering. The Company also announced that it has signed a
$1.5 million professional services agreement with one of the
world's largest retailers, Walmart Inc. Zest Labs is a subsidiary
of Ecoark Holdings, Inc.
Zest Labs' professional service offering addresses three core areas
that are critical to improving the fresh food supply chain and
reducing waste:
* Systems Integration and Customization of Quality Control
Systems, Warehouse Management Systems (WMS) and Third-party
Logistics (3PLs)
* Evaluation of Current Waste Sources to identify and quantify
shrink sources and issues that impact freshness and shelf-
life
* Operational Efficiency Assessments that establish process
adherence and equipment/asset utilization metrics and provide
improvement strategies
"By assessing all the variables that can impact delivered freshness
across the supply chain, we're able to provide organizations with
the right strategies for creating the operational efficiencies
necessary to improve product margin and sustainability by reducing
food waste," said Peter Mehring, CEO of Zest Labs.
One of the world's leading retailers has engaged Zest Labs, after a
pilot program, for its unmatched experience designing and
implementing freshness management solutions for the cold supply
chain that improve food safety and reduce waste. The company's
Zest Fresh solution improves the freshness of produce sold to
customers and helps organizations achieve efforts toward zero waste
within their operations and throughout their supply chain.
"This agreement is a testament to the innovation and thought
leadership exhibited by Zest Labs and the value that post-harvest
freshness management solutions provide today's marketplace," said
Mehring.
The professional services project is expected to be completed this
year.
About Zest Labs
Zest Labs is an AgTech company modernizing the post-harvest fresh
food supply chain to improve food safety and reduce food waste by
50% or more. Its flagship solution, Zest Fresh, provides
autonomous, field-to-shelf visibility for proactive decision making
to improve delivered freshness and reduce shrink. Integrated
blockchain technology provides true transparency for food safety,
product freshness and traceability. Zest Fresh improves
profitability and increases customer satisfaction and brand loyalty
while promoting sustainability.
About Ecoark Holdings
Rogers, Arkansas-based Ecoark Holdings, Inc. --
http://www.ecoarkusa.com/-- is an innovative and growth-oriented
company founded in 2007 that develops and deploys intelligent
technologies and products in order to meet the demand for
sustainable, integrated solutions to contemporary business needs.
Ecoark Holdings is a holding company that supports the businesses
of its subsidiaries in providing technological solutions for
customers to achieve ecological conservation through improvements
in efficiency or reduction of waste. Ecoark Holdings is the parent
company of Ecoark, Inc. and Magnolia Solar Inc.
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.
Ecoark reported a net loss of $25.23 million in 2016, and a net
loss of $10.47 million in 2015. As of Dec. 31, 2017, Ecoark had
$11.72 million in total assets, $2.71 million in total liabilities,
and $9.01 million in total stockholders' equity.
ECORSE, MI: S&P Lowers 2011 Financial Recovery Bonds to 'BB-'
-------------------------------------------------------------
S&P Global Ratings lowered its long-term rating on Ecorse, Mich.'s
series 2011 financial recovery bonds to 'BB-' from 'A'. The outlook
is stable.
"The downgrade is due to our analytical error where we are now
analyzing this transaction under our "Issuer Credit Ratings Linked
to U.S. Public Finance Obligors' Creditworthiness" criteria,
published Jan. 22, 2018, and our "Local Government GO Ratings
Methodology and Assumptions" criteria, published Sept. 13, 2013,
instead of our "Special Tax Bonds" criteria, published June 13,
2007.
S&P said, "At issuance in 2011 and in subsequent reviews, we
applied our Special Tax Bonds criteria to analyze the bonds. We
applied these criteria because of the various property taxes
pledged to support the bonds, some of which are limited." On June
2, 2015, however, the Special Tax Bonds criteria were updated to
include a section clarifying the characteristics of property
tax-secured bonds that may allow the obligation to be evaluated as
special tax bonds. Specifically, the criteria indicate that
property tax-secured bonds may be analyzed as special tax bonds
when bondholders are not pledged access to available balances of
the obligor. "Given the series 2011 bonds contain a dedicated
judgement millage and a limited-tax general obligation pledge of
the city, the source for which includes all legally available funds
of the obligor, based on the updated criteria, we have now
determined that the property tax pledge is not a special tax as
described in the Special Tax Bond criteria and therefore those
criteria do not apply," said S&P Global Ratings credit analyst
Errol Arne.
S&P said, "The stable outlook reflects our opinion that the city
will maintain balanced budgets by making the necessary adjustments
to maintain at least an adequate budgetary performance so as to
maintain at least a strong flexibility profile. As such we do not
expect the rating to change over our two-year outlook period.
"We could consider raising the rating if the city sustains its
strong budgetary performance and flexibility profile while
continuing to increase the funding percentage of its pension
liability and as long as the city's economic metrics (market value
per capita and per capita EBI) does not materially deteriorate from
its current levels.
"We could consider lowering the rating if the city's budgetary
performance falls to adequate or weak and is sustained at this
level for at least two years while negatively affecting the
budgetary flexibility profile."
ENVIGO HOLDINGS: S&P Affirms 'B-' CCR, Outlook Developing
---------------------------------------------------------
Envigo Holdings Inc. and Avista Healthcare Public Acquisition Corp.
recently announced the mutual termination of their agreement to
combine.
S&P Global Ratings affirmed its 'B-' long-term corporate credit
rating on Somerset, N.J.-based non-clinical contract research
organization (CRO) Envigo Holdings Inc. and removed the rating from
CreditWatch, where it was placed with positive implications on Dec.
1, 2017. The outlook is developing. The rating was initially placed
on CreditWatch with developing implications on Sept. 19, 2017.
S&P said, "At the same time, we affirmed our 'B-' rating on Envigo
Holdings Inc.'s senior secured debt and removed the rating from
CreditWatch. The recovery rating on this debt is '3', indicating
expectations for meaningful (50%-70%; rounded estimate 50%)
recovery in the event of a default.
"In addition, we affirmed our ratings on Envigo Laboratories Inc.'s
existing debt, including the 'B+' rating on the first-lien debt and
'CCC' rating on the second-lien debt. The recovery ratings are '1'
and '6', respectively. The '1' recovery rating reflects our
expectation for very high (90%-100%; rounded estimate 95%) recovery
in the event of a payment default. The '6' recovery rating reflects
our expectation for negligible (0%-10%; rounded estimate: 0%)
recovery in the event of a payment default.
"Our rating reflects our belief that Envigo will generate modestly
positive free cash flow (in the $10 million area) in 2018 and 2019,
despite the step-up in the interest rate in April 2018 (for some of
its issues) that will increase cash interest to about $40 million
annually. Our developing outlook reflects our belief that the cash
flow generation makes it likely that Envigo will be successful in
refinancing its $450 million in debt over the next few months. At
the same time, the developing outlook reflects weakening liquidity
and the potential for a downgrade if Envigo is not able to
refinance its debt over the next 12 months because of its $310
million of maturities in 2020.
"Our developing outlook reflects our belief, in the upside
scenario, that Envigo will likely refinance its capital structure
over the next six months and if the company is successful, we could
consider a positive outlook or higher rating depending on the final
capital structure. The outlook also reflects, in the downside
scenario, the risk that Envigo will not be able to refinance its
debt over the next six to 12 months. In this scenario, credit risk
would increase significantly because of its $310 million of
maturities in 2020, and we could consider a lower rating. Our 2018
expectations are for low- to mid-single-digit revenue growth,
essentially flat EBITDA margins, adjusted debt leverage in the
low-6x area, and free cash of about $10 million."
EXTENDED STAY: S&P Alters Outlook to Positive & Affirms 'BB-' CCR
-----------------------------------------------------------------
S&P Global Ratings revised its outlook on Charlotte, N.C.-based
Extended Stay America Inc. to positive from stable. S&P affirmed
all of its ratings on the company, including the 'BB-' corporate
credit rating.
S&P said, "The positive outlook reflects our expectation that
continued modest comparable hotel EBITDA growth, combined with
proceeds from additional asset sales, could result in leverage of
3.5x and FFO to debt in the low-20% area by 2019. These leverage
levels would likely provide sufficient cushion compared to our
upgrade thresholds of 4x adjusted debt to EBITDA and 20% adjusted
FFO to debt to accommodate a moderate level of future economic
variability, and as a result we could consider raising the rating
on Extended Stay within the next year. We recognize that supply in
the extended stay segment of the lodging industry has been growing
faster than that of the overall industry for the last several years
and could pressure occupancy growth. However, robust demand growth
in the segment has tempered the effect of increased supply so far.
Additionally, Extended Stay competes with more traditional economy
and midscale hotels, and we expect supply growth in these segments
to be relatively modest. The positive outlook assumes that the
lodging growth environment will remain supportive for Extended
Stay, allowing it to grow revenue per available room (RevPAR) even
if supply growth remains high and occupancy is flat or declines
modestly as a result.
"The positive outlook reflects our expectation that continued
modest comparable hotel EBITDA growth combined with proceeds from
additional asset sales could allow the company to reduce leverage
to 3.5x and FFO to debt in the low-20% area by 2019. These leverage
levels would likely provide sufficient cushion compared to our
upgrade thresholds of 4x adjusted debt to EBITDA and 20% adjusted
FFO to debt, and as a result we could consider raising the rating
on Extended Stay within the next year.
"We could raise the rating one notch to 'BB' if we believe Extended
Stay will sustain adjusted debt to EBITDA below 4x and FFO to debt
above 20% over the volatile lodging cycle. We would consider
raising the rating once we are confident that Extended Stay will
hit its leverage target of 3.5x, which would likely represent a
sufficient cushion compared to our upgrade threshold. This would
likely result from continued modest same-store EBITDA growth and
from the company using proceeds from asset sales to pay down debt
to offset any lost EBITDA from the sales.
"We could revise the outlook to stable if operating performance is
materially worse than our current expectations, or if we no longer
believe management will make financial policy decisions conducive
to achieving and maintaining leverage of 3.5x. Although unlikely
given our current base case forecast, we could consider lowering
the rating by one notch if Extended Stay's operating performance is
significantly worse than we expect and if we believe that the
company would not sustain adjusted debt to EBITDA under 5x and FFO
to debt above 12%."
FARGO TRUCKING: Needs Time to Resolve Fraudulent Conveyance Claims
------------------------------------------------------------------
Fargo Trucking Company, Inc., asks the U.S. Bankruptcy Court for
the Central District of California to extend the exclusivity period
during which only the Debtor can file a plan of reorganization from
March 6, 2018, to at least until June 4, 2018.
The Debtor hopes to emerge from bankruptcy by confirming a plan of
liquidation or reorganization. In order to file a plan and
disclosure statement, enough time needs to pass to (i) allow the
Debtor to work with the Official Committee of Unsecured Creditors,
judgment holders, the California Department of Labor Standards
Enforcement, Office of the Labor Commissioner, and the Joe Murez
Exempt Trust to resolve any concerns they have as to the settlement
motion, (ii) allow the Debtor sufficient time to resolve the
fraudulent conveyance claims through the settlement motion which
will provide funds with which the Debtor can fund a plan, (iii)
allow the Debtor sufficient time to resolve the claims filed
against it, (iv) allow the Debtor sufficient time to assess
profitability and provide projections supporting feasibility of any
proposed plan, and (v) allow the Debtor time to engage in
settlement negotiations with the Committee regarding a joint plan.
To emerge from bankruptcy, the Debtor's intention was to enter into
a settlement with various entities that may have liabilities to the
Debtor based on fraudulent conveyance and other theories. The
Debtor reached settlement with the various entities. On Jan. 10,
2018, the Debtor filed a motion for an order approving settlement
between the Debtor and CKT Logistics, Inc., Fargo International,
LLC, Fargo Transport, LLC, Fargo Trucking Logistic Co., LLC,
Express FTC, Inc., Hancore Brokerage Services, Inc., W3
International, Inc., June H. Ou, Philip H. Ting, Gershom Shing,
Robert F. Wallace, Kurt Oliver, and Sigmund H. Ting pursuant to
Federal Rule of Bankruptcy Procedure 9019. The proposed settlement
provides for payment of the total sum of $2 million and transfer of
52 trucks to the Debtor's estate and the waiver of a claim of at
least $1.2 million (a settlement having a value to the estate of $5
million -- not taking into account the value of the waived claim).
This settlement will provide funds with which the Debtor can fund a
plan.
The Debtor says that while it is unsure when it will be able to
file a plan and disclosure statement, the Debtor believes a 90-day
extension of the exclusivity period will allow the Debtor to
continue to work with the Committee and other parties to resolve
their objections to the settlement motion, negotiate a
reorganization, and start the process to resolve the claims filed
against it. Further, this period is short enough that creditors
and the Committee can have assurance that the Debtor will continue
diligently on the path or reorganization. Additionally, the
settlement motions is set for hearing on May 1, 2018, and no party
will be able to file a plan before the settlement motion is
resolved.
The Debtor's bankruptcy case presents complex issues related to
resolution of fraudulent transfer claims against third parties.
The Debtor must resolve the fraudulent transfer claims before
preparing a plan of liquidation or reorganization. The Debtor has
reached a settlement with third parties, which would resolve the
fraudulent transfer claims and provide significant funds for a
plan, but the Committee, judgment holders, Labor Commissioner, and
the landlord objected to the settlement motion on the basis that
they needed additional information to evaluate the proposed
settlement. Consequently, the Court ordered the settlement motion
to be a contested matter and therefore, allowed the parties to
start discovery. Due to the amount of discovery the Committee has
indicated it requires to analyze the settlement motion, resolving
the fraudulent transfer claims will take time. Further, as of
March 6, 2018, 53 proofs of claim have been filed, 50 of which
filed by the Debtor's drivers and the California Labor
Commissioner.
Some of these creditors have filed their claims as secured claims;
based on the Debtor's information regarding these claims, the
Debtor believes that they are undersecured and their priority and
secured status will need to be determined pursuant to a motion
brought under 11 U.S.C. Sec. 506. Moreover, because the bar date
has not passed, it is possible that more of the Debtor's drivers
will file proofs of claim. Once the bar date passes, the Debtor
will need to evaluate the legitimacy of the claims and determine
whether the Debtor has any objection to the claims.
Due to the number of claims that have been filed, and the number of
possible claims that may still be filed, the Debtor believes it
will need approximately 30 days to evaluate the legitimacy of the
claims and determine whether the Debtor has any objection to the
claims. The Debtor expects the claim objections to be resolved
within 45 days after the objections are filed. These claims should
be adjudicated by the Court prior to the filing a plan and
disclosure statement. Finally, since the Committee was recently
appointed on Dec. 19, 2017, the Debtor has been working with the
Committee and its financial advisors to resolve the Committee's
concerns, as well as work toward consensual resolution of this
case.
The Debtor needs time to negotiate with the judgment holders to
resolve their claims and to resolve the fraudulent conveyance
claims. The Debtor started settlement communications with a large
number of the drivers holding the judgments prior to the bankruptcy
filing. The Debtor intends to continue these negotiations during
the bankruptcy to try and reach an agreement with these creditors.
In addition, the Debtor needs time to evaluate the claims filed
against it and object to the filed claims, if necessary. The
drivers' claims should be resolved before the Debtor can prepare a
plan and disclosure statement.
The Committee has requested the Debtor to provide it with several
documents in relation to the settlement motion. The Debtor is in
the process of providing the Committee and its financial advisors
with the documents they have requested.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/cacb17-23714-90.pdf
About Fargo Trucking Company
Fargo Trucking Company, Inc., is Compton, California-based company
that provides trucking services.
Fargo Trucking sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. C.D. Cal. Case No. 17-23714) on Nov. 6, 2017. In the
petition signed by CEO Robert Wallace, the Debtor estimated assets
of less than $500,000 and liabilities of $1 million to $10
million.
Judge Neil W. Bason presides over the case.
David R. Haberbush, Esq., Vanessa M. Haberbush, Esq., and Lane K.
Bogard, Esq., at Haberbush & Associates, LLP, serve as the Debtor's
bankruptcy counsel.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors in the Debtor's case. The Committee retained
Levene, Neale, Bender, Yoo & Brill LLP, as its legal counsel.
FASTENER ACQUISITION: Moody's Assigns B3 Corporate Family Rating
----------------------------------------------------------------
Moody's Investors Service assigned a first-time B3 Corporate Family
Rating and B3-PD Probability of Default Rating to Fastener
Acquisition, Inc. dba SouthernCarlson, Inc., a national distributor
of fastening and packaging materials, and related building
materials predominately throughout the United States. In related
rating actions, Moody's assigned a B2 rating to the proposed senior
secured 1st lien bank debt and Caa2 to its proposed senior secured
2nd lien term loan. Proceeds from new debt will be used to
refinance company's existing term loan (unrated), to distribute a
dividend to affiliates of Kelso and Company ("Kelso"), primary
owner of SouthernCarlson, and to other investors, and to pay
related fees and expenses. The rating outlook is stable.
SouthernCarlson's new capital structure will consist of a $35
million senior secured revolving credit facility expiring in 2023,
of which there will be no borrowings expected at closing, $225
million senior secured 1st lien term loan maturing in 2025, and $85
million senior secured 2nd lien term loan maturing in 2026.
The following ratings/assessments are assigned:
Corporate Family Rating assigned B3
Probability of Default Rating assigned B3-PD;
$35 Million Gtd Senior Secured 1st Lien Revolving Credit Facility
due 2023 assigned B2 (LGD3);
$225 Million Gtd Senior Secured 1st Lien Term Loan due 2025
assigned B2 (LGD3);
$85 Million Gtd Senior Secured 2nd Lien Term Loan due 2026
assigned Caa2 (LGD5).
Outlook, assigned Stable
RATINGS RATIONALE
Fastener Acquisition, Inc.'s B3 Corporate Family Rating results
from its leveraged capital structure following the leveraged buyout
of SouthernCarlson by affiliates of Kelso and Company in July 2016,
debt utilized in past acquisitions, and recently proposed
debt-financed dividend. Balance sheet debt is increasing to $310
million from $185 million at calendar year-end 2016. Moody's
forecasts adjusted leverage of about 5.7x by FYE19. Large amount of
balance sheet debt and resulting cash interest payments, as well as
higher levels of working capital to meet growth demands, will
result in slightly positive adjusted free cash flow-to-debt over
next 12 to 18 months, limiting the amount of future debt reduction.
Moody's projections include modest organic growth, earnings from
past acquisitions, some synergies, some debt reduction, and Moody's
standard adjustments for operating leases. Moody's views the
debt-financed dividend as aggressive, since the dividend represents
multiple years of free cash flow. Liquidity is adequate on account
of low levels of free cash flow generation, and small revolver
relative to company's revenue base and fixed-charges.
SouthernCarlson's operating margins, which Moody's project will
improve, are low due to large amortization expense from purchase
accounting when Kelso acquired SouthernCarlson. However, by adding
back amortization SouthernCarlson's EBITA margin becomes more
in-line with other rated distributors, and Moody's project interest
coverage, measured as adjusted EBITA-to-interest expense, in 1.5x
range over next 12 to 18 months, which is reasonable relative to
company's current rating. SouthernCarlson has a very extended
maturity profile with no significant maturities beyond term loan
amortization until 2023 when its revolver expires.
Further, fundamentals of U.S. private construction end markets
remain sound. New home construction, from which SouthernCarlson
derives preponderance of its revenues and resulting earnings and
cash flows, is growing steadily. Moody's maintains a positive
outlook for the domestic homebuilding industry and projects new
housing starts will reach 1.280 million in 2018, representing a 6%
increase from 1.209 million in 2017. US repair and remodeling
activity, another source of revenues, remains upbeat. Moody's
expectations about financial performance considers trends in the
National Association of Home Builders (NAHB) Remodeling Market
Index -- an industry survey that gauges remodeling contractors'
expectations of demand over the next three months. The Remodeling
Market Index's overall reading was 59.8 in 4Q17. Over next 12 to 18
months, Moody's anticipate the overall reading remaining in
expansion mode.
SouthernCarlson has a good business model with a national
footprint, giving it access to all growing regions within the
United States. Company distributes mainly fastening supplies and
tools, and packaging equipment and supplies, affording it
reoccurring maintenance products' revenues.
Stable rating outlook reflects Moody's expectations that
SouthernCarlson's credit profile, such as leverage sustained below
6.5x, will remain supportive of its B3 Corporate Family Rating over
the next 12 to 18 months.
B2 rating assigned to proposed first-lien lien senior secured bank
debt, consisting of a $35 million revolving credit facility
expiring in 2023, and $225 million term loan due in 2025, one notch
above Corporate Family Rating, results from its effective seniority
to company's proposed second-lien debt. Revolving credit facility
and term loans are pari passu to each other in a recovery scenario.
These credit facilities have a first priority security on
substantially all domestic assets. Material domestic operating
subsidiaries of Fastener Acquisition, Inc., primary obligor of bank
debt, provide upstream guarantees. Term loan amortizes 1% per year
with bullet payment at maturity.
Caa2 assigned to proposed $85 million second-lien term loan, two
notches below Corporate Family Rating, results from its lien
subordination on collateral securing company's other bank debt, and
putting this commitment in a first-loss position relative to
company's secured debt. Residual value of collateral securing this
credit facility would be non-existent in a recovery scenario,
making it effectively unsecured debt. Material domestic operating
subsidiaries of Fastener Acquisition, Inc., primary obligor of bank
debt, provide upstream guarantees. This term loan does not
amortize, but has bullet payment at maturity.
Moody's does not anticipate positive rating actions over
intermediate term due to elevated debt leverage. However,
SouthernCarlson's ratings could be upgraded if operating
performance exceeds Moody's forecasts, and company uses free cash
flow to reduce permanently balance sheet debt, yielding adjusted
debt-to-EBITDA trending towards 5.0x. Better liquidity profile
would contribute to upwards rating momentum.
Downward rating pressure is not likely over next 12 to 18 months.
However, negative rating actions could ensue beyond then if
SouthernCarlson's operating performance falls below Moody's
expectations, resulting in debt-to-EBITDA staying above 6.5x, or
EBITA-to-interest expense trending below 1.0x (all ratios
incorporate Moody's standard adjustments), or company's liquidity
deteriorates. Large debt-financed acquisitions and more dividends
could also put downward pressure on ratings.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in December 2015.
Fastener Acquisition, Inc. dba SouthernCarlson, headquartered in
Omaha, NE, is a national distributor of fastening and packaging
materials, tools and related building materials predominately
throughout the United States. Kelso and Company, through its
affiliates, is primary owner of SouthernCarlson. Revenues for 12
months through December 31, 2017 totaled approximately $448 million
(excluding annualized revenues from acquisitions) SouthernCarlson
is privately-owned and does not make financial information publicly
available.
FASTENER ACQUISITION: S&P Assigns 'B' CCR, Outlook Stable
---------------------------------------------------------
S&P Global Ratings assigned its 'B' corporate credit rating to
fastener equipment and supplies distributor Fastener Acquisition
Inc. The outlook is stable.
S&P said, "We also assigned our 'B+' issue-level rating (one notch
above the corporate credit rating) to FAI's proposed $35 million
revolving credit facility due in 2023 and $225 million senior
secured first-lien term loan due in 2025. The '2' recovery rating
on the first-lien facilities indicates our expectation for
substantial recovery (70%-90%; rounded estimate: 75%) to lenders in
the event of a default.
"In addition, we assigned our 'CCC+' issue-level rating to the
company's proposed $85 million second-lien term loan due in 2026
with a '6' recovery rating, indicating that lenders could expect
negligible recovery (0%-10%; rounded estimate: 0%) in the event of
a default.
"The 'B' corporate credit rating and stable outlook on FAI reflects
our view of the company's very narrow niche product and packaging
focus, limited to fastener equipment, fasteners, and related
supplies. Our ratings on FAI also reflect the company's relatively
small (but rapidly growing) size; lack of geographic diversity with
nearly all sales in the U.S.; and somewhat cyclical demand for its
fastener products. We believe that end markets such as new
residential and commercial construction, roof replacement,
remodeling spending, and furniture manufacturing partially drive
the cyclicality of its business.
The stable outlook takes into account the strong demand drivers for
FAI's fastener business driven by good construction trends,
specifically in new home construction, and repair and remodeling
activity in the U.S. S&P believes these positive market
fundamentals should cause FAI to sustain a pro forma debt-to-EBITDA
ratio between 5x and 5.5x and interest coverage of about 2.5x over
the next 12 months.
S&P said, "We view a downgrade as unlikely given the favorable
economic environment driving new housing demand, remodeling
spending, and furniture manufacturing. However, we could downgrade
the company within the next year if conditions changed (possibly
due to a swift and extreme decrease in construction activity such
that FAI's EBITDA fell by 20% or more, bringing leverage above 6x
and interest coverage below 2x). We could also lower the rating if
the owners undertook aggressive debt-financed acquisitions or
dividends that drove metrics to these levels.
"Given the company's small size and niche product focus, we view an
upgrade as equally unlikely in the next year unless the company
grew significantly and diversified its products and end markets,
while reducing and sustaining leverage well below 5x. Incorporated
into the potential for an upgrade would be our assumption that
financial sponsor ownership would be committed to maintaining
leverage at less than 5x with a low risk of releveraging."
FIRESTAR DIAMOND: Seeks to Hire Getzler Henrich, Appoint CRO
------------------------------------------------------------
Firestar Diamond, Inc., seeks approval from the U.S. Bankruptcy
Court for the Southern District of New York to hire Getzler Henrich
& Associates LLC and appoint Mark Samson, the firm's managing
director, as chief restructuring officer.
The firm will assist the company and its affiliates, A. Jaffe Inc.
and Fantasy Inc., in developing and implementing a restructuring;
assess their current financial position and working capital needs;
negotiate with creditors; oversee any process for the sale of their
assets and resolution of claims; and provide other services related
to their Chapter 11 cases.
Getzler's professional fees will be at the rate of $160 to $625 per
hour, depending on the personnel assigned to the particular tasks.
The CRO will be charged at the rate of $535 per hour. However,
such fees will be capped at a maximum of $21,000 per week in the
aggregate with respect to all Debtors.
The firm's professional fees will be allocated among the Debtors
with 25% allocated to A. Jaffe and 75% allocated to Firestar and
Fantasy.
Prior to the Petition Date, the Debtors paid the firm a retainer in
the sum of $70,000, to be allocated 25% to services performed on
behalf of A. Jaffe and 75% to services performed on behalf of
Firestar and Fantasy.
Mr. Samson disclosed in a court filing that he and his firm do not
hold any interest adverse to the Debtors.
Getzler can be reached through:
Mark Samson
Getzler Henrich & Associates LLC
295 Madison Avenue, 20th Floor
New York, NY 10017
Tel: 212-697-2400
Fax: 212-697-4812
Email: msamson@getzlerhenrich.com
About Firestar Diamond
Firestar Diamond Inc. procures, designs, manufactures, and
distributes diamond-studded jewelry. Firestar Diamond's operations
span the USA, Europe, the Middle East, the Far East and India. The
Company employs over 1200 people. Firestar Diamond has offices in
Mumbai, Surat, New York, Chicago, Johannesburg, Antwerp, Yerevan,
Dubai, and Hong Kong. A. Jaffe, Inc., a subsidiary of Firestar
Diamond, designs and manufacturers wedding rings and wedding
bands.
Firestar Diamond, Inc., A. Jaffe, Inc., and Fantasy, Inc., sought
Chapter 11 protection (Bankr. S.D.N.Y. Case Nos. 18-10509 to
18-10511) on Feb. 26, 2018.
Firestar Diamond estimated assets and debt of $50 million to $100
million.
The Hon. Sean H. Lane is the case judge.
Ian R. Winters, Esq., at Klestadt Winters Jureller Southard &
Stevens, LLP, serves as counsel to the Debtors.
FLYING COW: Case Summary & 4 Unsecured Creditors
------------------------------------------------
Debtor: Flying Cow Ranch HC, LLC
1000 N US Hwy 1 #762
Jupiter, FL 33477
Type of Business: Flying Cow Ranch HC, LLC, is a privately held
company in Jupiter, Florida. It is a small
business debtor as defined in 11 U.S.C.
Section 101(51D).
Chapter 11 Petition Date: March 8, 2018
Case No.: 18-12681
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Hon. Paul G. Hyman, Jr.
Debtor's Counsel: Jordan L Rappaport, Esq.
RAPPAPORT OSBORNE & RAPPAPORT, PLLC
1300 N Federal Hwy #203
Boca Raton, FL 33432
Tel: (561) 368-2200
E-mail: office@rorlawfirm.com
- and -
Kenneth S Rappaport, Esq.
RAPPAPORT OSBORNE & RAPPAPORT, PLLC
1300 N Federal Hwy #203
Boca Raton, FL 33432
Tel: (561) 368-2200
E-mail: office@rorlawfirm.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $100,000 to $500,000
The petition was signed by James Hall, manager of FCR Investor
Group I, LLC, member.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/flsb18-12681.pdf
List of Debtor's Four Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Gunster Trade Debt- $14,616
Legal Fees
Lewis, Longman & Trade Debt $40,995
Walker, PA
Mallon Blatcher Trade Debt $36,105
Wantman Group Inc Trade Debt $86,388
GADFLY ENTERPRISES: Taps Mobile Accounting USA as Accountant
------------------------------------------------------------
Gadfly Enterprises Inc. seeks approval from the U.S. Bankruptcy
Court for the District of Maryland to hire Mobile Accounting USA as
its accountant.
The services to be provided by the firm include the preparation and
filing of quarterly payroll tax returns, reconciliation of bank
accounts; and assistance with operation of QuickBooks and
processing payroll.
The Debtor will make payments of $500 per month to the accountant,
except for the month of April when the firm will be paid $1,500 in
connection with the preparation of its annual income tax returns.
Dale Martin, a member of Mobile Accounting who will be providing
the services, disclosed in a court filing that he does not hold or
represent any interest adverse to the Debtor's estate.
Mobile Accounting can be reached through:
Dale E. Martin
Mobile Accounting USA
1 Research Court, Suite 450
Rockville, MD 20850
Phone: 888-816-1040
E-mail: info@mobileaccountingusa.com
About Gadfly Enterprises
Gadfly Enterprises Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Md. Case No. 18-10270) on Jan. 8, 2018.
At the time of the filing, the Debtor estimated assets of less than
$100,000 and liabilities of $1,000,001 to $10 million. Judge Lori
S. Simpson presides over the case. Cohen Baldinger & Greenfeld,
LLC is the Debtor's bankruptcy counsel.
GASTAR EXPLORATION: Closes Sale of Acreage in Oklahoma for $107.5M
------------------------------------------------------------------
Gastar Exploration Inc. has completed the previously announced sale
of its interest in the West Edmond Hunton Lime Unit for $107.5
million, adjusted for the effective date of Oct. 1, 2017 and
resulting in net cash proceeds of $98.8 million at closing. The
WEHLU encompasses only the Upper and Lower Hunton producing
formations and is primarily located in Oklahoma and Logan counties,
Oklahoma.
Michael A. Gerlich, Gastar's senior vice president and chief
financial officer, commented, "The completion of this asset
divestiture allows Gastar to redirect funds from a non-core asset
to the drilling of operated Osage and Meramec wells on our 67,000
net surface acres in our core STACK position. This level of
activity will allow us to continue to both delineate our acreage
for the Osage and Meramec formations as well as hold our acreage by
production."
About Gastar Exploration
Houston, Texas-based Gastar Exploration Inc. --
http://www.gastar.com/-- is a pure play Mid-Continent independent
energy company engaged in the exploration, development and
production of oil, condensate, natural gas and natural gas liquids.
Gastar's principal business activities include the identification,
acquisition, and subsequent exploration and development of oil and
natural gas properties with an emphasis on unconventional reserves,
such as shale resource plays. Gastar holds a concentrated acreage
position in the normally pressured oil window of the STACK Play, an
area of central Oklahoma that is home to multiple oil and natural
gas-rich reservoirs including the Meramec and Osage limestone
formations, the Oswego limestone, the Woodford shale and Hunton
limestone formations.
Gastar reported a net loss attributable to common stockholders of
$103.5 million on $58.25 million of total revenues for the year
ended Dec. 31, 2016, compared to a net loss attributable to common
stockholders of $474.0 million on $107.3 million of total revenues
for the year ended Dec. 31, 2015. As of Sept. 30, 2017, Gastar had
$370.8 million in total assets, $391.6 million in total
liabilities, and a total stockholders' deficit of $20.77 million.
* * *
In March 2017, S&P Global Ratings affirmed its 'CCC-' corporate
credit rating, with a negative outlook, on Gastar Exploration.
Subsequently, S&P withdrew all its ratings on Gastar at the
issuer's request.
In April 2017, Moody's Investors Service withdrew all assigned
ratings for Gastar Exploration, including the 'Caa3' Corporate
Family Rating, following the elimination of all of its rated debt.
GB SCIENCES: Terminates Business Relationship with Pacific Leaf
---------------------------------------------------------------
GB Sciences, Inc. and Pacific Leaf Ventures, LP entered into an
agreement to terminate all prior agreements between the parties,
according to a Form 8-K filed with the Securities and Exchange
Commission.
On May 12, 2015, GB Sciences commenced a business relationship with
Pacific Leaf starting with a credit facility whereby Pacific Leaf
would advance the Company up to $1,750,000 pursuant to a 6%
convertible note. The Company also agreed to pay Pacific Leaf a
royalty of up to 18.2% on the Company's gross sales revenue for a
royalty period of 10 years in exchange for the use by the Company
of certain Pacific Leaf technology. Over time the business
relationship was modified with the credit facility increasing to
$2,750,000 and the royalty rate payable to Pacific Leaf being
reduced in exchange for 1,000,000 shares of the Company's common
stock and the grant of options to purchase 1,500,000 shares of
common stock at the purchase price of $0.36 per share.
On Feb. 23, 2018, the Company and Pacific Leaf entered into an
Agreement whereby all rights and obligations between the parties
pursuant to all prior agreements would terminate. Under the terms
of the agreement, the Company paid Pacific Leaf $1,269,818 upon the
signing of the agreement and will pay Pacific Leaf an additional
$1,500,000 on or before July 31, 2018. The Company will also issue
Pacific Leaf 1,600,000 shares of restricted common stock on or
before July 31, 2018. Thereafter, no business relationship will
exist between the parties.
About GB Sciences
Las Vegas, Nevada-based GB Sciences, Inc., formerly Growblox
Sciences, Inc., is developing and utilizing state of the art
technologies in plant biology, cultivation and extraction
techniques, combined with biotechnology, and plans to produce
consistent and measurable medical-grade cannabis, cannabis
concentrates and cannabinoid therapies. The Company seeks to be an
innovative technology and solution company that converts the
cannabis plant into medicines, therapies and treatments for a
variety of ailments.
GB Sciences reported a net loss of $10.08 million for the 12 months
ended March 31, 2017, compared to a net loss of $7.07 million for
the 12 months ended March 31, 2016. As of Dec. 31, 2017, GB
Sciences had $16.39 million in total assets, $7.92 million in total
liabilities and $8.47 million in total equity.
The Company's independent registered public accountants' report for
the year ended March 31, 2017 includes an explanatory paragraph
that expresses substantial doubt about the Company's ability to
continue as a "going concern." Soles, Heyn & Company LLP, in West
Palm Beach, Florida, stated as of March 31, 2017, the Company had
accumulated losses of approximately $35,255,000, has not generated
any revenue. These factors and the need for additional financing
in order for the Company to meet its business plan, raise
substantial doubt about its ability to continue as a going concern.
GENESIS TOTAL: Taps Atty. George Jacobs as Legal Counsel
--------------------------------------------------------
Genesis Total Healthcare LLC received approval from the U.S.
Bankruptcy Court for the Eastern District of Michigan to hire
George Jacobs, Esq., as its legal counsel.
Mr. Jacobs will advise the Debtor regarding its duties under the
Bankruptcy Code and will provide other legal services related to
its Chapter 11 case. He will charge an hourly fee of $295 for his
services.
In a court filing, Mr. Jacobs disclosed that he is a "disinterested
person" as defined in section 101(14) of the Bankruptcy Code.
Mr. Jacobs maintains an office at:
George E. Jacobs, Esq.
2425 S. Linden Road, Suite C
Flint, MI 48532
Phone: (810) 720-4333
Email: george@bklawoffice.com
About Genesis Total Healthcare
Genesis Total Healthcare, LLC, practices as a home health provider
in Burton, Michigan. Genesis Total Healthcare sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
17-32058) on Sept. 8, 2017. Judge Daniel S. Oppermanflint presides
over the case. At the time of the filing, the Debtor estimated
assets of less than $500,000 and liabilities of less than $1
million.
GENON ENERGY: Subsidiary to Pay Peabody Coalsales $80K Cure Amount
------------------------------------------------------------------
BankruptcyData.com reported that GenOn Energy filed with the U.S.
Bankruptcy Court a stipulation by and among GenOn Energy, and GenOn
Energy Management and Peabody Coalsales. The stipulation notes, "In
connection with GEM's assumption of the Coal Supply Agreement, GEM
shall pay Peabody COALSALES a cure amount of $80,769.50 (the
'Agreed Cure Amount') in accordance with article V.C. of the Plan.
Payment of the Agreed Cure Amount shall be deemed to cure,
compensate and otherwise fully satisfy any and all actual and/or
alleged defaults, losses and/or related obligations accruing or
otherwise arising under or in relation to the Coal Supply Agreement
up through and including December 31, 2017, for which GEM may be
responsible under 11 U.S.C. section 365(b)(1)(A) and (B)."
About GenOn Energy
GenOn Energy, Inc., is a wholesale power generation corporation
with 15,394 megawatts in generating capacity, operating operate 32
power plants in eight states. GenOn is subsidiary of NRG Energy
Inc., which is a competitive power company that produces, sells and
delivers energy and energy services, primarily in major competitive
power markets in the U.S.
GenOn is the product of two mergers since 2010. First, on Dec. 3,
2010, two wholesale power generation companies -- RRI Energy, a
company formerly known as Reliant Energy, and Mirant Corporation
-- completed an all-stock, tax-free merger with Mirant becoming
RRI's wholly-owned subsidiary. Following the merger, RRI took its
current name: GenOn.
NRG, through a wholly-owned subsidiary, and GenOn completed a
stock-for-stock merger in a $6 billion deal, with GenOn continuing
as the surviving company on December 14, 2012. NRG, as
consideration for acquiring GenOn's entire equity, issued 0.1216
shares of NRG common stock for each outstanding share of GenOn. In
structuring the merger, NRG "ring-fenced" GenOn's debt, leaving
GenOn's creditors without recourse against NRG's assets in the
event of GenOn's default.
As of March 31, 2017, GenOn Energy had $4.81 billion in total
assets, $4.51 billion in total liabilities and $304 million in
total stockholders' equity.
GenOn Energy, Inc. ("GenOn"), GenOn Americas Generation, LLC
("GAG") and 60 of their directly and indirectly-owned subsidiaries
commenced the Chapter 11 cases in Houston, Texas (Bankr. S.D. Tex.
Lead Case No. 17-33695) on June 14, 2017, to implement a
restructuring plan negotiated with stakeholders prepetition. The
Debtors' cases have been assigned to Judge David R. Jones.
Kirkland & Ellis LLP is the Debtors' bankruptcy counsel. Zack A.
Clement, PLLC, is the local counsel. Rothschild Inc. is the
financial advisor and investment banker. McKinsey Recovery &
Transformation Services U.S. is the restructuring advisor. Epiq
Systems, Inc., is the claims and noticing agent.
Credit Suisse Securities (USA) LLC serves as GenOn Energy's
financial advisor and investment banker.
Special Counsel to the GAG Steering Committee is Quinn Emanuel
Urquhart & Sullivan, LLP. The Steering Committee of GAG
Noteholders is comprised of Benefit Street Partners LLC, Brigade
Capital Management, LP, Franklin Mutual Advisers, LLC, and Solus
Alternative Asset Management LP, each on behalf of itself or
certain affiliates, and/or accounts managed and/or advised by it or
its affiliates.
Counsel to the GenOn Steering Committee and the GAG Steering
Committee are Keith H. Wofford, Esq., Stephen Moeller-Sally, Esq.,
and Marc B. Roitman, Esq., at Ropes & Gray LLP.
Counsel for NRG Energy, Inc., are C. Luckey McDowell, Esq., and Ian
E. Roberts, Esq., at Baker Botts L.L.P.
GILDED AGE: Court Denies Access to Cash Collateral
--------------------------------------------------
The Hon. Diane Finkle of the U.S. Bankruptcy Court for the District
of Rhode Island denied Gilded Age Properties LLC's Cash Collateral
Motion because there is no budget attached for the applicable
period of March 1, 2018 through March 30, 2018.
About Gilded Age Properties
Gilded Age Properties, LLC, owns and operates two properties: a
commercial rental property located at 117 Bellevue Avenue in
Newport, Rhode Island and a residential apartment building located
at 38-40 Freebody Street in Newport, Rhode Island.
Gilded Age Properties filed a Chapter 11 petition (Bankr. D.R.I.
Case No. 17-10738) on May 4, 2017. In the petition signed by
member Peter M. Iascone, the Debtor estimated assets and
liabilities between $1 million and $10 million. The case is
assigned to Judge Diane Finkle. The Delaney Law Firm LLC is the
Debtor's bankruptcy counsel. Kirby Commercial, LLC, is the
Debtor's real estate agent.
GREENTECH AUTOMOTIVE: Sec. 341 Creditors' Meeting Set for April 5
-----------------------------------------------------------------
The Office of the U.S. Trustee for Region 4 will conduct a Sec. 341
meeting of creditors in the Chapter 11 cases of GreenTech
Automotive, Inc., and its five debtor-affiliates on April 5, 2018,
at 10:00 a.m. at the Office of the U.S. Trustee (Chapter 11), 115
South Union Street, Suite 208, Alexandria, Virginia.
According to a docket entry, creditors must file proofs of claim by
July 5, 2018. Complaints for determination of dischargeability of
debt must be filed by June 4, 2018.
About GreenTech Automotive
GreenTech Automotive, Inc. -- http://www.wmgta.com/us-- an
electric car company, and five affiliates filed for Chapter 11
bankruptcy protection (Bankr. E.D. Va. Lead Case No. 18-10651) on
Feb. 26, 2018.
GreenTech Automotive, headquartered in Sterling, Virginia, was
organized in Mississippi in 2009 for the purpose of developing,
producing, marketing and financing energy efficient automobiles,
including electric cars. WMIC, a Virginia corporation, is a
holding company that holds a majority of the outstanding shares of
common stock of GreenTech.
GreenTech estimated $100 million to $500 million in both assets and
liabilities. The petition was signed by Norman Chirite, authorized
representative.
The Hon. Brian F. Kenney presides over the cases.
Kristen E. Burgers, Esq., at HIRSCHLER FLEISCHER PC; and Mark S.
Lichtenstein, Esq., at CROWELL & MORING LLP, serve as co-counsel to
the Debtors.
HARDES PARTNERSHIP: Case Summary & 3 Unsecured Creditors
--------------------------------------------------------
Debtor: Hardes Partnership
18461 355th Ave
Miller, SD 57362-5511
Business Description: Hardes Partnership is a privately held
company in the crop farming industry located
in Miller, South Dakota. Hardes' gross
revenue amounted to $974,721 in 2017
and $1.88 million in 2016.
Chapter 11 Petition Date: March 8, 2018
Case No.: 18-30011
Court: United States Bankruptcy Court
District of South Dakota (Central (Pierre))
Judge: Hon. Charles L. Nail, Jr.
Debtor's Counsel: Robert L. Meadors, Esq.
BRENDE & MEADORS LLP
P.O. Box 1024
Sioux Falls, SD 57101-1024
Tel: 605-333-0070
Fax: 605-333-0121
E-mail: rlm@bsmllp.com
Total Assets: $1.03 million
Total Liabilities: $11.33 million
The petition was signed by Wade Hardes, managing partner.
A full-text copy of the petition, along with a list of three
unsecured creditors, is available for free at
http://bankrupt.com/misc/sdb18-30011.pdf
HCR MANORCARE: Taps Epiq as Claims and Noticing Agent
-----------------------------------------------------
HCR ManorCare, Inc. received approval from the U.S. Bankruptcy
Court for the District of Delaware to hire Epiq Bankruptcy
Solutions, LLC as its claims and noticing agent.
The firm will oversee the distribution of notices and the
maintenance, processing and docketing of claims filed in the
Debtor's Chapter 11 case.
The hourly rates charged by the firm for claims administration
are:
Clerical/Administrative Support $25 – $45
IT/Programming $65 – $85
Case Managers $70 – $165
Consultants/Directors/VP $160 – $190
Solicitation Consultant $190
Executive VP, Solicitation $215
Executives No Charge
Communication Consultant $395
The Debtor provided the firm a retainer in the sum of $25,000 prior
to the Petition date.
Kathryn Tran, director of Epiq, disclosed in a court filing that
her firm is a "disinterested person" as defined in section 101(14)
of the Bankruptcy Code.
Epiq can be reached through:
Kathryn Tran
Epiq Bankruptcy Solutions, LLC
777 Third Avenue, 12th Floor
New York, NY 10017
Phone: (347) 867-5858
E-mail: ktran@epiqglobal.com
About HCR ManorCare
Headquartered in Toledo, Ohio, HCR ManorCare, Inc. --
https://www.hcr-manorcare.com/ -- is a national healthcare provider
that, through certain non-debtor providers, operates a network of
more than 450 locations nationwide across these business segments:
(a) skilled nursing and inpatient rehabilitation facilities (SNFs),
memory care facilities, and assisted living facilities; (b) hospice
and home health care agencies; and (c) outpatient rehabilitation
clinics and other ancillary healthcare and related businesses. The
company has approximately 50,000 employees in full- and part-time
positions.
HCR ManorCare sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 18-10467) on March 4, 2018, with a
deal in which its landlord, Quality Care Properties Inc., will take
control of the company.
In the petition signed by CRO John R. Castellano, the Debtor
disclosed $4.264 billion in assets and $7.118 billion in
liabilities as of Dec. 31, 2017.
Judge Kevin Gross presides over the case.
The Debtor hired Sidley Austin LLP as bankruptcy counsel; Young,
Conaway, Stargatt & Taylor LLP as Delaware counsel; Moelis &
Company LLC as investment banker; and AP Services LLC as financial
advisor.
HEARING HEALTH: Taps Wernette Heilman as Legal Counsel
------------------------------------------------------
Hearing Health Science, Inc., seeks approval from the U.S.
Bankruptcy Court for the Eastern District of Michigan to hire
Wernette Heilman PLLC as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; negotiate with creditors; assist in the
preparation of a plan of reorganization; and provide other legal
services related to its Chapter 11 case.
Michael Wernette, Esq., and Ryan Heilman, Esq., the attorneys who
will be handling the case, will charge $315 per hour and $330 per
hour, respectively.
Wernette Heilman received the sum of $12,500, of which $4,191 was
used to pay its fees and expenses incurred prior to the Petition
Date, and $1,717 for the filing fee.
Ryan Heilman, Esq., at Wernette Heilman, disclosed in a court
filing that his firm is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
Wernette Heilman can be reached through:
Ryan D. Heilman, Esq.
Wernette Heilman PLLC
24725 W. 12 Mile Rd., Suite 110
Southfield, MI 48034
Phone: (248) 663-5146
Email: ryan@wernetteheilman.com
About Hearing Health Science
Hearing Health Science, Inc., is a start-up health research company
that has developed a nutritional supplement called Soundbites that
helps preserve hearing. The company is headquartered in Ann Arbor,
Michigan.
Hearing Health Science sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Mich. Case No. 18-41927) on Feb. 15,
2018. Judge Marci B. Mcivor presides over the case. At the time
of the filing, the Debtor estimated assets and liabilities of
$1,000,001 to $10 million.
HELP KIDS: Taps Leonard K. Welsh as Legal Counsel
-------------------------------------------------
Help Kids, Inc., received approval from the U.S. Bankruptcy Court
for the Eastern District of California to hire the Law Offices of
Leonard K. Welsh as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; assist in the preparation of a plan of
reorganization; and provide other legal services related to its
Chapter 11 case.
Welsh received a pre-bankruptcy retainer of $30,000, of which
$5,842 was paid to the firm for services provided and costs
incurred prior to the petition date.
The firm does not hold any interests adverse to the Debtor,
according to court filings.
Welsh can be reached through:
Leonard K. Welsh, Esq.
Law Offices of Leonard K. Welsh
4550 California Avenue, 2nd Floor
Bakersfield, CA 93309
Tel: (661) 328-5328
Fax: (661) 760-9900
E-mail: lwelsh@lkwelshlaw.com
About Help Kids Inc.
Help Kids, Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Calif. Case No. 18-10390) on February
6, 2018. Judge Rene Lastreto II presides over the case.
At the time of the filing, the Debtor disclosed that it had
estimated assets of $1,000,001 to $10 million and liabilities of
less than $1 million.
HGIM CORP: S&P Cuts CCR to 'D' After Chapter 11 Bankruptcy Filing
-----------------------------------------------------------------
U.S.-based offshore service provider HGIM Corp. announced that it
has filed a voluntary, prepackaged Chapter 11 bankruptcy.
S&P Global Ratings lowered its corporate credit rating on
U.S.-based offshore service provider HGIM Corp. to 'D' from
'CCC-'.
At the same time, S&P lowered its issue-level rating on the
company's senior secured debt to 'D' from 'CCC-'. The recovery
rating remains '3'. The '3' recovery rating indicates S&P's
expectation of meaningful (50%-70%; rounded estimate: 50%) recovery
in the event of a payment default.
The downgrade follows the company's announcement that it has
voluntarily filed a prepackaged Chapter 11 bankruptcy.
S&P expects to withdraw the ratings after 30 days.
HI-LO FARMS: Gets Authorization to Use Cash Collateral
------------------------------------------------------
Judge Katharine M. Samson of the U.S. Bankruptcy Court for the
Southern District of Mississippi authorized Hi-Lo Farms, Inc., to
use the cash collateral of the Bank of Okolona for maintenance,
marketing and administrative costs, until Hi-Lo's farm is sold or
this case is dismissed.
Prior to Petition Date, Hi-Lo obtained loans from the Bank of
Okolona, which is secured by the real property of Hi-Lo in Monroe
County, Mississippi along with other property owned and controlled
by the equity security holder of Hi-Lo.
The real property of the Debtor generates rental income of $2,978
per month, paid by Prestage Farms, Inc. pursuant to the lease,
which represents as cash collateral of the Bank of Okolona.
A full-text copy of the Order is available at
http://bankrupt.com/misc/mssb17-51239-116.pdf
About Hi-Lo Farms
Hi-Lo Farms, Inc., is a privately-held company in Gulfport,
Mississippi, which is engaged in farming. It sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Miss. Case No.
17-51239) on June 23, 2017. In the petition signed by Martha L.
Cole, president, the Debtor estimated assets and liabilities of $1
million to $10 million. Judge Katharine M. Samson presides over
the case. Patrick Sheehan at Sheehan Law Firm, PLLC, serves as
bankruptcy counsel to the Debtor.
HOUGHTON MIFFLIN: S&P Lowers CCR to 'B-' on Negative Cash Flow
--------------------------------------------------------------
U.S.-based pre-K through 12 education solutions company Houghton
Mifflin Harcourt Co.'s (HMH) 2018 addressable market will likely be
about $2.5 billion, lower than S&P's previous expectation of $2.7
billion.
S&P Global Ratings lowered its corporate credit rating on
Boston-based Houghton Mifflin Harcourt Co. (HMH) to 'B-' from 'B'.
The outlook is stable.
S&P said, "At the same time, we lowered our issue-level rating on
the company's $800 million senior secured term loan ($780 million
outstanding) to 'B' from 'B+'. The '2' recovery rating is
unchanged, indicating our expectation for substantial (70%-90%;
rounded estimate: 75%) recovery of principal for lenders in the
event of a payment default.
"The downgrade reflects HMH's track record of negative free
operating cash flow (FOCF) in 2016 and 2017, and our expectation
for improving but negative FOCF in 2018 due to limited or no growth
in its addressable market. The company's profitability within the
K-12 educational publishing sector is volatile and dependent on the
size of its addressable market, which fluctuates significantly with
state textbook adoption cycles. HMH's addressable market has
declined to about $2.5 billion in 2017 from about $3 billion in
2014, a year of record sales and profitability, causing credit
ratios to weaken considerably. We now expect the market to remain
flat in 2018, lower than our previous expectations of about $2.7
billion. We expect significant market growth to over $3 billion in
2019 due to key reading and language arts curriculum adoptions
scheduled for Texas and mathematics adoption in Florida, and for
HMH's FOCF to exceed $125 million in 2019. However, the company
remains susceptible to returning to negative FOCF during the next
cyclical trough. We believe this could occur if HMH can't increase
its extension businesses' revenue, which has less volatility than
the core curriculum products sold through new state adoptions; if
it can't maintain or increase market share; or if there are any
operational missteps that cause HMH to miss certain new state
adoptions.
"The stable outlook reflects our expectation for negative but
improving FOCF in 2018 before it increases to over $125 million in
2019 due to significant growth in the addressable market and HMH
maintaining or modestly increasing its 38% market share. We expect
FOCF to debt will improve above 12% in 2019.
"We could lower the corporate credit rating if we expect HMH's 2019
addressable market will not grow to the $3 billion area, HMH to
lose market share, or FOCF will not exceed $100 million in 2019. In
this scenario, we would view HMH to be vulnerable and dependent
upon favorable business, financial, and economic conditions to meet
its financial commitments or that its capital structure as
unsustainable due to K-12 textbook market volatility, lost market
share, high debt-service burden, or limited or negative FOCF.
"Though unlikely over the next 12 months, we could raise our rating
if we believe HMH's recent restructuring and efforts to increase
its extension businesses' revenue will result in consistent
positive FOCF, with FOCF to debt remaining in the 5% area or higher
through the next trough in the addressable K-12 textbook market. An
upgrade would also require HMH to maintain a financial policy
focused on profitable reinvesting in the business or debt repayment
rather than shareholder returns during peak market conditions like
those expected in 2019."
HUMANIGEN INC: Black Horse Entities Become Majority Owners
----------------------------------------------------------
Humanigen, Inc. previously entered into a securities purchase and
loan satisfaction agreement and a forbearance and loan modification
agreement on Dec. 21, 2017, each with Black Horse Capital Master
Fund LTD, Black Horse Capital LP, Cheval Holdings, LTD and Nomis
Bay LTD, in connection with a series of transactions providing for,
among other things, the satisfaction and extinguishment of the
Company's outstanding obligations under the Credit and Security
Agreement dated Dec. 21, 2016, as amended between the Company and
the Lenders, and the infusion into the Company of $3 million of new
capital. The Transactions were completed on Feb. 27, 2018.
On the Effective Date, the Company: (i) in exchange for the
satisfaction and extinguishment of all of the Company's
approximately $16.7 million of outstanding obligations under the
Credit Agreement, (a) issued to the Lenders an aggregate of
59,786,848 shares of the Company's common stock, with Nomis Bay and
the Black Horse Entities each receiving 50% of the New Lender
Shares; and (b) transferred and assigned to an entity owned 70% by
Nomis Bay and 30% by the Company, all of the Company's assets
related to benznidazole, the Company's former drug candidate,
capable of being so assigned; and (ii) issued to Cheval an
additional 32,028,669 shares of the Company's common stock for
total cash consideration of $3 million, $1.5 million of which the
Company received on Dec. 22, 2017 in the form of a bridge loan. The
issuances of the New Common Shares were made in reliance on the
exemption from registration provided by Section 4(a)(2) of the
Securities Act of 1933, as amended, as transactions not involving a
public offering.
In addition, on the Effective Date, the Company and the Lenders
also entered into a Termination and Release Agreement and a
Registration Rights Agreement.
Termination and Release Agreement
Pursuant to the terms of the Termination Agreement, on the
Effective Date: (i) all of the Company's outstanding obligations
under the Credit Agreement were deemed to be satisfied and
extinguished; (ii) each of the Credit Agreement, all promissory
notes issued thereunder and the Intellectual Property Security
Agreement, dated as of Dec. 21, 2016, by and between the Company
and the Lenders, were terminated and are no longer of further force
or effect; and (iii) all security interests of the Black Horse
Entities and Nomis Bay in the Company's assets were released.
Although the Company's outstanding obligations under the Credit
Agreement were satisfied and extinguished, if the JV Entity (at the
election of Nomis Bay) elects not to keep the Benz Assets following
its evaluation of the Benz Assets and certain claims related
thereto after the Effective Date, the Benz Assets will revert back
to the Company.
Registration Rights Agreement
On the Effective Date, the Company also entered into a Registration
Rights Agreement with the Lenders, pursuant to which the Company
granted to the Lenders certain registration rights related to the
New Common Shares and any other shares of the Company's common
stock owned by the Lenders as of the Effective Date. Under the
Registration Rights Agreement, the Company agreed to prepare and
file with the Securities and Exchange Commission a registration
statement on an appropriate form for the purpose of registering the
resale of the Registrable Securities within 180 days after the
Effective Date, and to use its best efforts to cause the Shelf
Registration Statement to be declared effective by the SEC. If the
Company has not filed the Shelf Registration Statement by the
Filing Deadline, or if the Company fails to maintain the
effectiveness of the Shelf Registration Statement, the Lenders may
demand that the Company register all or any portion of the
Registrable Securities pursuant to a registration statement on Form
S-1. In addition, if the Company proposes to register the offer
and sale of any shares of its common stock under the Securities Act
in another offering, either for its own account or for the account
of other stockholders, the Lenders will be entitled to certain
"piggyback" registration rights allowing them to include their
Registrable Securities in such registration. The Registration
Rights Agreement does not provide for payment by the Company to the
Lenders of any penalties or other fees in any circumstances. The
Company has agreed to indemnify the Lenders and their affiliates
against certain liabilities arising in connection with performance
of the Company's obligations under the Registration Rights
Agreement.
Additional Information
The completion of the Transactions on the Effective Date resulted
in a change in control of the Company, as the issuance of the New
Common Shares to the Black Horse Entities resulted in the Black
Horse Entities and their affiliates owning more than a majority of
the Company's outstanding common stock. As a result, the Black
Horse Entities and their affiliates, acting together, will be able
to exert control over matters of the Company and will be able to
determine all matters of the Company requiring stockholder
approval. Upon completion of the Transactions, the Black Horse
Entities collectively hold approximately 62.6% of the Company's
outstanding common stock, and Nomis Bay holds approximately 31.4%
of the Company's outstanding common stock. Dale Chappell, a former
director of the Company who resigned on Nov. 9, 2017, is an
affiliate of each of the Black Horse Entities.
Amendments to Articles
Effective Feb. 26, 2018, the Company amended its Amended and
Restated Certificate of Incorporation, as amended, to amend Article
IV of the Charter to (i) increase the number of authorized shares
of Common Stock from 85,000,000 to 225,000,000, and (ii) authorize
the issuance of 25,000,000 shares of preferred stock of the
Company, par value $0.001, with such powers, rights, terms and
conditions as may be designated by the Company's board of directors
upon the issuance of shares of Preferred Stock at one or more times
in the future. As previously disclosed in the Company's definitive
information statement filed Jan. 30, 2018, the Charter Amendment
was approved and adopted by the written consent of a majority of
the stockholders of the Company in accordance with the applicable
provisions of the Delaware General Corporation Law, the Charter,
and the Company's Second Amended and Restated Bylaws.
About Humanigen, Inc.
Formerly known as KaloBios Pharmaceuticals, Inc., Humanigen, Inc.
(OTCQB: HGEN), -- http://www.humanigen.com/-- is a
biopharmaceutical company focused on advancing medicines for
patients with neglected and rare diseases through innovative,
accelerated business models. Lead compounds in the portfolio are
benznidazole for the potential treatment of Chagas disease in the
U.S., and the proprietary monoclonal antibodies, lenzilumab and
ifabotuzumab. Lenzilumab has potential for treatment of various
rare diseases, including hematologic cancers such as chronic
myelomonocytic leukemia (CMML) and juvenile myelomonocytic leukemia
(JMML). Humanigen is based in Brisbane, California.
KaloBios filed a voluntary petition for bankruptcy protection under
Chapter 11 of Title 11 of the United States Bankruptcy Code (Bankr.
D. Del. Case No. 15-12628) on Dec. 29, 2015. The Company was
represented by Eric D. Schwartz of Morris, Nichols, Arsht &
Tunnell. KaloBios emerged from Chapter 11 bankruptcy six months
later.
HORNE LLP, in Ridgeland, Mississippi, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Dec. 31, 2016, noting that the Company has recurring losses
from operations that raise substantial doubt about its ability to
continue as a going concern.
KaloBios reported a net loss of $27.01 million in 2016 following a
net loss of $35.37 million in 2015. As of Sept. 30, 2017,
Humanigen had $2.56 million in total assets, $24.14 million in
total liabilities and a total stockholders' deficit of $21.57
million.
HUMANIGEN INC: Nomis Bay Has 31.4% Stake as of March 5
------------------------------------------------------
In a Schedule 13D/A filed with the Securities and Exchange
Commission, Nomis Bay LTD reported that as of March 5, 2018, it
beneficially owns 33,573,530 shares of common stock of Humanigen,
Inc., constituting 31.44 percent based upon approximately
106,802,229 shares of Common Stock outstanding as of Feb. 27, 2018.
A full-text copy of the regulatory filing is available for free
at:
https://is.gd/m5ecLv
About Humanigen, Inc.
Formerly known as KaloBios Pharmaceuticals, Inc., Humanigen, Inc.
(OTCQB: HGEN), — http://www.humanigen.com/— is a
biopharmaceutical company focused on advancing medicines for
patients with neglected and rare diseases through innovative,
accelerated business models. Lead compounds in the portfolio are
benznidazole for the potential treatment of Chagas disease in the
U.S., and the proprietary monoclonal antibodies, lenzilumab and
ifabotuzumab. Lenzilumab has potential for treatment of various
rare diseases, including hematologic cancers such as chronic
myelomonocytic leukemia (CMML) and juvenile myelomonocytic leukemia
(JMML). Humanigen is based in Brisbane, California.
KaloBios filed a voluntary petition for bankruptcy protection under
Chapter 11 of Title 11 of the United States Bankruptcy Code (Bankr.
D. Del. Case No. 15-12628) on Dec. 29, 2015. The Company was
represented by Eric D. Schwartz of Morris, Nichols, Arsht &
Tunnell. KaloBios emerged from Chapter 11 bankruptcy six months
later.
HORNE LLP, in Ridgeland, Mississippi, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Dec. 31, 2016, noting that the Company has recurring losses
from operations that raise substantial doubt about its ability to
continue as a going concern.
KaloBios reported a net loss of $27.01 million in 2016 following a
net loss of $35.37 million in 2015. As of Sept. 30, 2017,
Humanigen had $2.56 million in total assets, $24.14 million in
total liabilities and a total stockholders' deficit of $21.57
million.
HYLAND SOFTWARE: Moody's Affirms B2 CFR After Debt-Funded Purchase
------------------------------------------------------------------
Moody's Investors Service affirmed Hyland Software, Inc.'s
Corporate Family Rating ("CFR") and probability of default ratings
at B2 and B2-PD respectively. Moody's also affirmed the B1 rating
on its upsized first lien debt and the Caa1 rating on its upsized
second lien debt. The rating outlook is stable.
The add-on borrowings along with cash on the balance sheet will be
used to finance the acquisition of the OneContent assets from
Allscripts Healthcare Solutions, Inc. OneContent is an enterprise
software business specializing in Enterprise Content Management
("ECM") for hospitals and healthcare facilities that provides
healthcare document management solutions to hospital staff and
physicians.
RATINGS RATIONALE
Hyland's B2 Corporate Family Rating reflects its high leverage and
acquisition appetite. The rating is supported by Hyland's leading
niche ECM market positions and its well-regarded vertical market
focused product offerings. Although OneContent and the recent
Perceptive businesses were declining prior to Hyland's acquisition,
they appear to be good strategic fits and Moody's expect that the
company will manage the integrations successfully. Pro forma for
the acquisitions, Hyland's leverage was about 6.5x excluding
certain one-time expenses (over 7x including those expenses and
well over 10x on a GAAP basis). Moody's expects leverage to decline
to under 6.5x over the next 12-18 months as restructuring costs run
off in the absence another acquisition or leveraging dividend. The
rating incorporates the expectation that Hyland could lever up
temporarily to fund acquisitions or dividends but will de-lever
shortly thereafter.
Liquidity is good based on a cash balance of at least $90 million
post the acquisition and an undrawn $100 million revolving credit
facility as well as positive free cash flow generation. Hyland's
estimated uses of liquidity includes annual first lien term loan
amortization of 1% and mandatory debt repayment from excess cash
flow. Moody's expect the company will have sufficient headroom
under its covenants.
Hyland's capital structure consist of a first lien revolver and
term loan (both rated B1) and a second lien term loan (rated Caa1),
with each rating reflecting the debt position in the capital
structure relative to the B2 corporate family rating.
The stable outlook reflects Moody's expectation that Hyland will
complete the integrations of Perceptive (acquired July 2017) and
OneContent with minimal disruption and flat to modest net organic
revenue growth over the next 12-18 months.
Given the complexities of integrating multiple acquisitions and
Hyland's high financial risk tolerance under financial sponsor
ownership, a ratings upgrade is not expected in the near term.
However, Hyland's ratings could be upgraded over time if it
demonstrates a meaningful increase in profits and operating cash
flow and if Moody's believe that the company will maintain leverage
below 5.0x.
The ratings could be downgraded if Hyland's operating performance
deteriorates or if leverage is expected to remain above 6.75x or
its FCF is negative on other than a temporary basis. .
Affirmations:
Issuer: Hyland Software, Inc.
-- Probability of Default Rating, Affirmed B2-PD
-- Corporate Family Rating, Affirmed B2
-- Senior Secured 1st Lien Bank Credit Facility, Affirmed B1
LGD3)
-- Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa1
(LGD6)
-- Outlook, Remains Stable
The principal methodology used in these ratings was Software
Industry published in December 2015.
Headquartered in Westlake, OH, Hyland Software, Inc. ("Hyland")
provides Enterprise Content Management software that combines
document management, business process management and records
management solutions. The company primarily focuses on the
mid-market segment and divisions of large organizations. Moody's
expect Hyland to generate over $700 million in revenue in 2018.
Hyland is owned by funds managed by private equity firm Thoma
Bravo, the founder's family, management and other shareholders.
ICONIX BRAND: Radcliffe Capital Has 9.5% Stake as of Feb. 22
------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, these reporting persons disclosed beneficial ownership
of shares of common stock of Iconix Brand Group, Inc. as of Feb.
22, 2018:
Shares Percentage
Beneficially of
Reporting Person Owned Shares
---------------- ------------ ----------
Radcliffe Capital Management, L.P. 5,961,598 9.5%
RGC Management Company, LLC 5,961,598 9.5%
Steven B. Katznelson 5,961,598 9.5%
Christopher Hinkel 5,962,598 9.5%
Radcliffe Ultra Short
Duration Master Fund, L.P. 5,464,054 8.7%
Radcliffe Capital Investors, LLC 5,464,054 8.7%
A full-text copy of the regulatory filing is available at:
https://is.gd/yNdPcN
About Iconix Brand
Broadway, New York-based Iconix Brand Group, Inc. --
http://www.iconixbrand.com/-- is a brand management company and
owner of a diversified portfolio of over 30 global consumer brands
across the women's, men's, entertainment, home and international
segments. The Company's business strategy is to maximize the value
of its brands primarily through strategic licenses and joint
venture partnerships around the world, as well as to grow the
portfolio of brands through strategic acquisitions.
Iconix reported a net loss attributable to the Company of $252.1
million in 2016 following a net loss attributable to the Company of
$189.3 million in 2015. As of Sept. 30, 2017, Iconix had $1.08
billion in total assets, $1.13 billion in total liabilities, $30.72
million in redeemable non-controlling interest, and a $77.66
million total stockholders’ deficit.
"Due to certain developments, including the recent decision by
Target Corporation not to renew the existing Mossimo license
agreement and by Walmart, Inc., not to renew the existing
DanskinNow license agreement with us and our revised forecasted
future earnings, we forecasted that we would be unlikely to be in
compliance with certain of our financial debt covenants in 2018 and
that we may face possible liquidity challenges in 2018. This raises
substantial doubt about our ability to continue as a going concern.
Our ability to continue as a going concern is dependent on our
ability to raise additional capital and implement our business
plan," said the Company in its quarterly report for the period
ended Sept. 30, 2017.
IHEARTCOMMUNICATIONS INC: Inks Forbearance Agreement with Lenders
-----------------------------------------------------------------
iHeartCommunications, Inc., and certain lenders entered into a
forbearance agreement on March 4, 2018, with respect to the Credit
Agreement, dated as of May 13, 2008, as amended and restated as of
Feb. 23, 2011, among the Company, as the parent borrower, the
subsidiary co-borrowers and foreign subsidiary revolving borrowers
party thereto, iHeartMedia Capital I, LLC, as a guarantor,
Citibank, N.A., as administrative agent, swing line lender and
letter of credit issuer, and the other lenders from time to time
party thereto. The Consenting Lenders constitute the lenders
required under the Credit Agreement to grant a forbearance.
Pursuant to the Forbearance Agreement, the Consenting Lenders
agreed to temporarily forbear from accelerating the obligations
under the Credit Agreement or otherwise exercising any rights or
remedies thereunder as a result of any actual or prospective event
of default under Section 8.01(e) of the Credit Agreement resulting
from the Company's failure to make an interest payment beyond the
applicable grace period with respect to its 14.00% Senior Notes due
2021 that was originally due on Feb. 1, 2018. The forbearance
became effective upon all parties' execution thereof and will
terminate immediately and automatically upon the earliest to occur
of (i) March 7, 2018 at 11:59 p.m. Central time and (ii) an event
of default under the Credit Agreement other than those that
resulted in the entry into the Forbearance Agreement.
Pursuant to the Forbearance Agreement, the Company agreed to not
make payments on account of any indebtedness or obligations under
the indentures governing the Company's legacy notes and the
Company's 14.00% Senior Notes due 2021 during the Forbearance
Period.
Restructuring Discussions Update
As previously disclosed, the Company has engaged in discussions
with its stakeholders with respect to the restructuring of its
capital structure. In connection with those discussions,
iHeartMedia, Inc., the indirect parent of the Company, and the
Company have been working on a proposed draft restructuring support
agreement and related proposed draft restructuring term sheet with
advisors to groups of the Company's noteholders, lenders and equity
holders. The draft restructuring support agreement and related
draft restructuring term sheet have been shared by those advisors
with the groups they represent.
No agreement has been reached with respect to the discussions or
the terms and discussions remain ongoing. iHeartMedia, Inc. will
continue to work with all of its constituents to develop a
consensual transaction to allocate consideration among its various
stakeholders. There can be no assurances that a consensual
transaction or any agreement will be reached.
About iHeartMedia, Inc. and
iHeartCommunications, Inc.
iHeartMedia, Inc. (PINK:IHRT), the parent company of
iHeartCommunications, Inc., is a global media and entertainment
company. Based in San Antonio, Texas, iHeartCommunications
specializes in radio, digital, outdoor, mobile, social, live
events, on-demand entertainment and information services for local
communities, and uses its unparalleled national reach to target
both nationally and locally on behalf of its advertising partners.
The Company's outdoor business reaches over 34 countries across
five continents.
iHeartCommunications reported a net loss attributable to the
Company of $296.31 million in 2016, a net loss attributable to the
Company of $754.6 million in 2015, and a net loss attributable to
the Company of $793.8 million in 2014.
As of Sept. 30, 2017, iHeartCommunications had $12.25 billion in
total assets, $23.93 billion in total liabilities and a total
stockholders’ deficit of $11.67 billion.
* * *
As reported by the TCR on Feb. 12, 2018, Fitch Ratings has affirmed
iHeartCommunications, Inc.'s Long-Term Issuer Default Rating (IDR)
at 'C'. iHeart's 'C' IDR reflects the likelihood for a near-term
default and potential restructuring event, which increased
following the company's strategic decision to not pay the $106
million cash interest payment on a more junior piece of debt that
was due on Feb. 1, 2018.
Also in February 2018, S&P Global Ratings lowered its corporate
credit ratings on Texas-based iHeartMedia Inc. and its iHeart
subsidiary to 'SD' (selective default) from 'CC'. The downgrade
follows iHeart's recent announcement that it did not make a $106
million net cash interest payment on its 12%/14% senior notes due
2021. The payment was due on Feb. 1.
HeartCommunications' carries a 'Caa2' Corporate Family Rating from
Moody's Investors Service.
IHEARTCOMMUNICATIONS INC: OKs Bonuses for Executives Under KEIP
---------------------------------------------------------------
The Compensation Committee of the Board of Directors of
iHeartCommunications, Inc., has approved bonus payments for the
following named executive officers of the Company.
Robert W. Pittman. The Compensation Committee approved a bonus
opportunity for Robert W. Pittman, the Company's chairman and chief
executive officer, under a new 2018 Key Incentive Bonus Plan,
pursuant to which Mr. Pittman will be eligible to earn a target
bonus for each calendar quarter of 2018 of $2,325,000. The
Compensation Committee approved payment of Mr. Pittman's Quarterly
Bonus for the period ending March 31, 2018; provided that Mr.
Pittman is required to repay the after-tax value of the Quarterly
Bonus if he were to be terminated for "cause" or voluntarily resign
without "good reason" before March 31, 2019. In addition, the
Compensation Committee accelerated the payments of bonuses Mr.
Pittman previously earned during 2016 ($500,000) and 2017
($500,000) under the iHeartMedia, Inc. 2015 Supplemental Incentive
Plan. Mr. Pittman is required to repay the after-tax value of the
relevant portion of these SIP payments upon any termination of his
employment if he would have forfeited such portion if payment of
these SIP payments had not been accelerated.
Richard J. Bressler. The Compensation Committee approved a bonus
opportunity for Richard J. Bressler, the Company's president, chief
operating officer and chief financial officer, under the 2018 KEIP,
pursuant to which Mr. Bressler will be eligible to earn a Quarterly
Bonus for each calendar quarter of 2018 of $1,325,000. The
Compensation Committee approved payment of Mr. Bressler's Quarterly
Bonus for the period ending March 31, 2018; provided that Mr.
Bressler is required to repay the after-tax value of the Quarterly
Bonus if he were to be terminated for "cause" or voluntarily resign
without "good reason" before March 31, 2019. In addition, the
Compensation Committee accelerated the payments of bonuses Mr.
Bressler previously earned during 2016 ($500,000) and 2017
($500,000) under the SIP. Mr. Bressler is required to repay the
after-tax value of the relevant portion of these SIP payments upon
any termination of his employment if he would have forfeited such
portion if payment of these SIP payments had not been accelerated.
Robert H. Walls, Jr. The Compensation Committee approved a bonus
opportunity for Robert H. Walls, Jr., the Company's executive vice
president, general counsel and secretary, under the 2018 KEIP,
pursuant to which Mr. Walls will be eligible to earn a Quarterly
Bonus for each calendar quarter of 2018 of $225,000. The
Compensation Committee approved payment of Mr. Walls' Quarterly
Bonus for the period ending March 31, 2018; provided that Mr. Walls
is required to repay the after-tax value of the Quarterly Bonus if
he were to be terminated for "cause" or voluntarily resign without
"good reason" before March 31, 2019.
All of the payments are in addition to the bonuses the named
executive officers will earn for 2017 performance under the plans
in effect for 2017, and any SIP payments earned during 2015, all of
which were paid in accordance with the terms of the agreements.
About iHeartMedia, Inc. and
iHeartCommunications, Inc.
iHeartMedia, Inc. (PINK:IHRT), the parent company of
iHeartCommunications, Inc., is a global media and entertainment
company. Based in San Antonio, Texas, iHeartCommunications
specializes in radio, digital, outdoor, mobile, social, live
events, on-demand entertainment and information services for local
communities, and uses its unparalleled national reach to target
both nationally and locally on behalf of its advertising partners.
The Company's outdoor business reaches over 34 countries across
five continents.
iHeartCommunications reported a net loss attributable to the
Company of $296.31 million in 2016, a net loss attributable to the
Company of $754.6 million in 2015, and a net loss attributable to
the Company of $793.8 million in 2014.
As of Sept. 30, 2017, iHeartCommunications had $12.25 billion in
total assets, $23.93 billion in total liabilities and a total
stockholders’ deficit of $11.67 billion.
* * *
As reported by the TCR on Feb. 12, 2018, Fitch Ratings has affirmed
iHeartCommunications, Inc.'s Long-Term Issuer Default Rating (IDR)
at 'C'. iHeart's 'C' IDR reflects the likelihood for a near-term
default and potential restructuring event, which increased
following the company's strategic decision to not pay the $106
million cash interest payment on a more junior piece of debt that
was due on Feb. 1, 2018.
Also in February 2018, S&P Global Ratings lowered its corporate
credit ratings on Texas-based iHeartMedia Inc. and its iHeart
subsidiary to 'SD' (selective default) from 'CC'. The downgrade
follows iHeart's recent announcement that it did not make a $106
million net cash interest payment on its 12%/14% senior notes due
2021. The payment was due on Feb. 1.
HeartCommunications' carries a 'Caa2' Corporate Family Rating from
Moody's Investors Service.
IOWA FINANCE: Fitch Rates Series 2018 A&B Revenue Bonds 'B-'
------------------------------------------------------------
Fitch Ratings has assigned a 'B-' rating to the Iowa Finance
Authority's Midwestern Disaster Area Revenue Bonds series 2018A and
2018B. Fitch has also affirmed the rating on the outstanding 2013
and 2016 Midwestern Disaster Area Revenue Bonds (series 2013, 2016,
2018A and 2018B together, the revenue bonds) at 'B-'. The Rating
Outlook has been revised to Stable from Negative. The Iowa Finance
Authority has issued a total of $1.185 billion ($1.156 billion
outstanding) of revenue bonds on behalf of Iowa Fertilizer Company
LLC (IFCo).
RATING RATIONALE
The ratings reflect that a limited margin of safety remains for
repayment of the bonds. The 2018 bond exchange improves the
project's long-term financial profile, and recently achieved
provisional acceptance positions the project to generate stable
operating cash flow. Notwithstanding, the facility could face
ramp-up issues and remains vulnerable to a volatile and potentially
weak product pricing environment. Favorably, access to abundant and
advantageously priced feedstock partially mitigates margin risk.
The Outlook revision reflects the project has reached provisional
acceptance, and started operations and generating operational cash
flow. The project has sufficient liquidity available in the form of
a debt service reserve fund (DSRF) and operations and maintenance
reserve fund (O&MRF) to help mitigate short-term liquidity issues.
KEY RATING DRIVERS
Nitrogen Market Price Exposure: IFCo sells its nitrogen products to
farmers, distributors, wholesalers, cooperatives, and blenders at
market prices. The project's main products have historically
exhibited considerable price volatility. Favorably, the project
enjoys some geographical product pricing advantages, but remains
exposed to long-term market supply and demand risks.
Natural Gas Price Risk: The project is procuring its natural gas
feedstock via an existing pipeline at prices linked to the Henry
Hub index, which is an important advantage compared to some
international competitors. IFCo has entered into natural gas call
swaptions for the first seven years of the project to moderate the
risk of a reversal in gas pricing trends. In addition, the project
will fund a feedstock reserve and can enter into further call
swaptions to help mitigate price risk during the non-hedged period,
which would also dispense with the requirement to fund a hedging
reserve account.
Unproven Operating Profile: Non-feedstock O&M and maintenance cost
projections have not been tested, and the project may require
several years of operations to establish a stable cost profile. The
use of commercially proven technologies and a plant design with
oversized capacity could help mitigate operating performance risk.
Improved Long Term Financial Profile: The 2018 bond exchange and
achieved provisional acceptance improve the long-term financial
profile and positions the project to achieve operational
self-sufficiency. Through the 2018 bond exchange, IFCo has extended
the debt maturity and lowered its annual debt service. Over the
full debt term, Fitch's analysis suggests that IFCo's ability to
meet ongoing mandatory debt payments remains vulnerable to
deterioration of operating margins. Given the ongoing uncertainty
surrounding nitrogen product prices, Fitch's financial scenarios do
not assume any improvement in operating margins over the extended
debt term. Fitch's base and rating cases indicate that debt service
coverage at current product prices would average 3.08x and 2.31x
through debt maturity. Although the rating case minimum drops to
0.82x in the year of a major facility turnaround, the project has
enough liquidity in its DSRF and O&MRF to comfortably mitigate the
shortfall. On a long-term basis, the project's relatively high
equity distribution triggers will support debt repayment and
replenishment of reserves during potential periods of low operating
cash flow.
Peer Analysis: IFCo's peer group includes merchant project
financings in which product sales are susceptible to the inherent
volatility of commodity markets. Merchant projects that have
achieved ratings in the 'BB' category have demonstrated some
combination of long-term feedstock price certainty, materially
lower leverage, structural enhancements, or a proven,
quasi-monopolistic competitive advantage. Merchant projects in the
'B' rating category or lower typically face significant technology
implementation or construction risks, are exposed to price and
volume risk, and operate in a business environment with highly
volatile margins.
RATING SENSITIVITIES
Future Developments That May, Individually or Collectively, Lead to
Negative Rating Action:
-- Early operational performance below expectations or weakening
in near-term product prices.
-- A fundamental shift in the supply-demand balance or global
producer cost curve that results in materially lower operating
margins expected to persist over a long period.
-- Inability to effectively manage operating costs or failure to
reach and sustain projected capacity and utilization rates.
Future Developments That May, Individually or Collectively, Lead to
Positive Rating Action:
-- Long-term positive product pricing trends.
-- Sustained production and margins exceeding expectations.
J.C. PENNEY: S&P Rates New $350MM Second-Lien Notes Due 2025 'B'
----------------------------------------------------------------
S&P Global Ratings assigned its 'B' issue-level rating and '5'
recovery rating to J.C. Penney Corp.'s (JCP) proposed $350 million
second-lien notes due 2025. The '5' recovery rating reflects S&P's
expectation for modest (10%-30%; rounded estimate 20%) in the event
of a default. The company plans to use the net proceeds to tender
for and repay portions of its unsecured debt that matures in 2019
and 2020.
S&P's ratings on JCP, including the 'B+' corporate credit rating
and negative outlook are not affected by this refinancing action,
which reflects the company's continued focus on improving the
capital structure. Last month, the company repaid $190 million of
maturing debt with cash.
Ratings Assigned
J.C. Penney Corp. Inc.
Senior Secured
US$350 mil 2nd lien nts due 2025 B
Recovery Rating 5(20%)
Ratings Affirmed; Recovery Expectation Revised
To From
J.C. Penney Corp. Inc.
Senior Secured BB- BB-
Recovery Rating 2(85%) 2(80%)
J.C. Penney Co. Inc.
J.C. Penney Corp. Inc.
Senior Unsecured B B
Recovery Rating 5(20%) 5(15%)
J.C. Penney Co. Inc.
Senior Unsecured B B
Recovery Rating 5(20%) 5(15%)
JACOB WIRTH: Court Sets March 13 Hearing on Exclusivity Motion
--------------------------------------------------------------
The Hon. Melvin S. Hoffman of the U.S. Bankruptcy Court for the
District of Massachusetts will hold a hearing on March 13, 2018, at
10:00 a.m., to consider extending the exclusive period for Jacob
Wirth Restaurant Company, LLC, to file a Plan of Reorganization.
Any objections must be filed and served no later than 12:00 noon on
March 12, 2018.
The Debtor asked the Court to extend the exclusive period for the
Debtor to file a Plan of Reorganization up to and including June
15, 2018 as it is still attempting to sell its business as a going
concern. The Debtor anticipated filing a liquidating plan or other
procedural mechanism to pay creditors.
About Jacob Wirth Restaurant
Jacob Wirth Restaurant Company, LLC, is a German-American
restaurant and bar located at 37 Stuart Street in Boston,
Massachusetts. Founded in 1868, Jacob Wirth is one of the oldest
restaurants in Boston serving a menu of traditional German
specialties and current American favorites.
Jacob Wirth Restaurant Company sought protection under Chapter 11
of the Bankruptcy Code (Bankr. D. Mass. Case No. 17-14263) on Nov.
15, 2017. In the petition signed by Kevin W. Fitzgerald, its
manager and member, the Debtor estimated assets of $100 million to
$500 million and liabilities of $1 million to $10 million.
Judge Melvin S. Hoffman presides over the case.
Gary W. Cruickshank, Esq., at Law Office of Gary W. Cruickshank,
serves as the Debtor's legal counsel.
JADE INVESTMENTS: Wilmington Trust Wants to Ban Cash Collateral Use
-------------------------------------------------------------------
Secured Creditor Wilmington Trust, National Association, for the
benefit of the holders of B2R Mortgage Trust 2015-2 Mortgage
Pass-Through Certificates requests the U.S. Bankruptcy Court for
the Southern District of West Virginia to prohibit Jade
Investments, LLC, from using the rents the Debtor assigned to
Wilmington Trust.
In the alternative, Wilmington Trust requests that the Court
require the Debtor to provide Wilmington Trust adequate protection
for the Debtor's use of Wilmington Trust's cash collateral.
Wilmington Trust is the owner and holder of the Loan Documents
evidencing a loan made to Debtor in the original principal amount
of $925,000, secured by a first and perfected lien on various real
and personal property and improvements located in Raleigh County,
West Virginia. The Collateral encompasses all real and personal
property related to the Property, including, without limitation,
the rents.
Wilmington Trust asserts that the rents are Wilmington Trust's
property and are not property of the Debtor's estate. To the extent
that the Court finds that rents are property of the Debtor's
estate, Wilmington Trust claims that the Debtor cannot provide it
with adequate protection for the Debtor's use of the rents, which
constitute Wilmington Trust cash collateral.
Wilmington Trust is a secured creditor of the Debtor with a
security interest in and lien on, and an absolute assignment of
leases and rents with respect to, the Debtor's Single Asset Real
Estate comprised of a dozen rental properties in Beaver, Mt. Hope
and Beckley, West Virginia.
Wilmington Trust objects to the Debtor's use of Wilmington Trust's
cash collateral. Wilmington Trust does not consent to the Debtor's
use of the rents and the Debtor cannot adequately protect
Wilmington Trust's interest if they remain as Debtor-in-possession.
The Debtor has a demonstrated history of putting the interests of
its members ahead of the financial health of the Debtor and the
interests of its creditors. Thus, it cannot be trusted, even with
the oversight available in bankruptcy, to operate the Debtor any
differently now.
Wilmington Trust tells the Court that the Debtor's continued
possession of the collateral and operation of the Property puts
Wilmington Trust's interests in the rents and in the collateral at
risk. Based on the Debtor's history of failing to pay the
Property's obligations, a real danger exists that the Debtor will
siphon rents from the Property while Wilmington Trust's collateral
position in the Property and in the rents erodes. Based on the
foregoing facts, Wilmington Trust cannot consent to the Debtor's
use of the Rents.
Attorneys for Wilmington Trust:
R. Andrew Hutchinson, Esq.
Baker, Donelson, Bearman, Caldwell & Berkowitz, PC
100 Med Tech Parkway, Suite 200
Johnson City, Tennessee 37604
Phone: (423) 928-0181
Fax: (423) 928-5694
E-mail: dhutchinson@bakerdonelson.com
About Jade Investments
Jade Investments, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. W.Va. Case No. 18-50025) on Feb. 6,
2018. In the petition signed by Joshua Conaway, member, the Debtor
estimated assets and liabilities of less than $1 million. Judge
Frank W. Volk presides over the case. Caldwell & Riffee is the
Debtor's counsel.
JAMES R. PITCAIRN: Taps Einwag Morrow as Accountant
---------------------------------------------------
James R. Pitcairn, Inc., seeks approval from the U.S. Bankruptcy
Court for the Western District of Pennsylvania to hire Einwag
Morrow & Associates, P.C. as its accountant.
The firm will assist the Debtor in preparing its income tax returns
and will provide other accounting services in connection with its
Chapter 11 case.
The firm's hourly rates are:
Staff $70
Senior Staff $95
Manager $138
Senior Manager $180
Partner $260
Ronald Einwag, a partner at Einwag Morrow, disclosed in a court
filing that all employees of his firm are "disinterested persons"
as defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Ronald J. Einwag
Einwag Morrow & Associates, P.C.
20 Stanwix Street, No. 630
Pittsburgh, PA 15222
Phone: (412) 281-8248/(412) 281-7183
Fax: (412) 281-8454
About James R. Pitcairn Inc.
Based in Pittsburgh, Pennsylvania, James R. Pitcairn, Inc. --
http://www.jamesrpitcairn.com/-- sells, services, installs, and
repairs residential elevators, wheelchair lifts, stair lifts, and
dumbwaiters. Its products are manufactured by Custom Elevator
Manufacturing Company, Inc., and hand crafted to meet each
specialized individual's mobility needs.
James R. Pitcairn sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case No. 17-24210) on Oct. 21,
2017.
In the petition signed by Craig M. Pitcairn, the Debtor estimated
assets of less than $50,000 and liabilities of $1 million to $10
million.
Judge Carlota M. Bohm presides over the case.
Gary William Short, Esq., at the Law Firm of Gary W. Short, serves
as the Debtor's bankruptcy counsel.
JC PENNEY: Moody's Affirms B1 CFR & Rates New 2nd Priority Notes B1
-------------------------------------------------------------------
Moody's Investors Service affirmed Penney (J.C.) Company, Inc.'s
(J.C. Penney) Corporate Family Rating of B1 rating. Moody's also
assigned a B2 to the proposed senior secured second priority notes
of Penney (J.C.) Corporation, Inc. The net proceeds from the
offering are expected to be used to tender for a portion of its
senior unsecured notes maturing in 2019 and 2020. Upon completion
of the proposed transaction, the company's senior secured term loan
and senior secured notes have been downgraded to Ba3 from Ba2 and
its ABL Revolving Credit Facility has been downgraded to Ba2 from
Ba1. Its SGL-1 rating has also been affirmed. The outlook is stable
for J.C. Penney.
"The proposed transaction will extend J.C. Penney's maturity
profile and further support its very good liquidity profile",
stated Vice President, Christina Boni. "Although the company has
opportunities for further improvements in merchandising, sourcing
and operations, significant headwinds remain for department stores
generally with weak mall traffic, and continued market share gains
by off-price retailers an online retailers."
Downgrades:
Issuer: Penney (J.C.) Corporation, Inc.
-- Senior Secured Term Loan, Downgraded to Ba3(LGD3) from
Ba2(LGD2)
-- Senior Secured ABL Revolving Credit Facility, Downgraded to
Ba2(LGD2) from Ba1(LGD2)
-- Senior Secured Regular Bond/Debenture, Downgraded to Ba3(LGD3)
from Ba2(LGD2)
Assignments:
Issuer: Penney (J.C.) Corporation, Inc.
-- Senior Secured Regular Bond/Debenture, Assigned B2(LGD5)
Outlook Actions:
Issuer: Penney (J.C.) Company, Inc.
-- Outlook, Remains Stable
Affirmations:
Issuer: Penney (J.C.) Company, Inc.
-- Probability of Default Rating, Affirmed B1-PD
-- Speculative Grade Liquidity Rating, Affirmed SGL-1
-- Corporate Family Rating, Affirmed B1
Issuer: Penney (J.C.) Corporation, Inc.
-- Senior Unsecured Medium-Term Note Program, Affirmed (P)B3
-- Senior Unsecured Regular Bond/Debenture, Affirmed B3(LGD5)
-- Senior Unsecured Shelf, Affirmed (P)B3
RATINGS RATIONALE
J.C. Penney's B1 CFR is supported by the company's solid liquidity
profile with total liquidity of approximately $2.3 billion ($458
million of cash and an estimated $1.85 billion of undrawn revolving
credit commitments as of February 3, 2018) and Moody's expect the
company will generate positive free cash flow over the next 12 to
18 months. Debt/EBITDA is estimated to be around 5.9 times as of
year-end 2017 and is estimated to improve to approximately 5.5x by
year end. The company has recovered a portion of its market share
lost under previous management's failed business strategies and
Moody's expect J.C. Penney to make continued progress albeit at a
slower pace. Ongoing merchandising and operational efficiencies
will also help the company boost margins over time. The credit is
constrained by the structural challenges facing the Department
Store segment which include market share losses to off-price
retailers, weak mall traffic, and the cost of investments
associated with managing consumer preferences for online shopping.
The stable rating outlook assumes that J.C. Penney will continue on
track towards it operating plan and prioritize debt reduction.
Ratings could be upgraded if the company maintains continued growth
in operating earnings indicating its business initiatives continue
to succeed. Quantitatively ratings could be upgraded if debt/EBITDA
were sustained below 4.0x times and EBIT margins are sustained at
or above mid-single digits.
Quantitatively ratings could be downgraded if credit metrics were
to weaken such that debt/EBITDA exceeded 5.5x, or if the company's
strong liquidity profile were to erode.
Penney (J.C.) Company, Inc. is the holding company of Penney (J.C.)
Corporation, Inc., a U.S. department store operator headquartered
in Plano, Texas, with about 875 locations in the United States and
Puerto Rico. It also operates a website, www.jcp.com. Revenues are
approximately $12.5 billion.
JONES & PINER: PFCU Wants to Prohibit Cash Collateral Use
---------------------------------------------------------
Philadelphia Federal Credit Union asks the U.S. Bankruptcy Court
for the Eastern District of Pennsylvania to prohibit Jones & Piner
Real Estate Group, LLC from further use of PFCU's cash collateral,
and direct Jones & Piner to account for, and to forthwith turn over
to PFCU, all amounts of such cash collateral received by Jones &
Piner post-petition.
On March 28, 2016, Jones & Piner made, executed and delivered a
Note to PFCU, evidencing the establishment of a Line of Credit in
the maximum principal amount of $416,000 as an inducement to PFCU
to extend the Loan, in consideration of PFCU's decision to do so,
and as security for its repayment, Jones & Piner made, executed and
delivered a Mortgage to, and in favor of PFCU, upon the real
property located at 5042 Baltimore Avenue, Philadelphia, PA 19143.
As further security for its repayment, Jones & Piner made, executed
and delivered an Assignment of Rents and Leases to, and in favor of
PFCU, upon the Premises.
PFCU holds a mortgage upon, and an Assignment of Rents and Leases
for, the Premises. Accordingly, the rents of the Premises are the
cash collateral of PFCU, as set forth in the Mortgage and in the
ARL. PFCU did not exercise the ARL pre-petition, so that Jones &
Piner could perhaps obtain permission to use post-petition rents in
its reorganization, either by consent, or by order of the Court.
However, Jones & Piner has neither sought not obtained the
permission of PFCU (or a court order) authorizing the use of PFCU's
collateral, in violation of 11 U.S.C. Section 363(c).
PFCU says that this bankruptcy case is essentially a two-party
dispute, and does not belong in Bankruptcy Court. According to its
Statement of Financial Affairs, Jones & Piner's gross income for
calendar year 2017 was only $16,800. T he monthly payments that
Jones & Piner is required to make under the terms of the Note total
$32,449 a year, and real estate taxes on the Premises total
approximately $4,200 a year.
Jones & Piner has made no payments to PFCU on account of the Loan
since September, 2017, and no post-petition payments at all. PFCU
believes that Jones & Piner lacks sufficient income to propose a
Plan that would fully pay the obligation owed to PFCU. Other than
$10.00 in a deposit account, the only asset listed on the Jones &
Piner's Schedules is a certain parcel of real property with
improvements, located at 5042 Baltimore Avenue, Philadelphia.
Thus, PFCU asserts that Jones & Piner cannot afford to make even
interest-only payments to PFCU during its reorganization. Moreover,
PFCU does not know if Jones & Piner holds in-force insurance on the
Premises protecting the interests of the estate. The lack of
in-force insurance on the Premises would constitute an inability to
"adequately protect" PFCU's interest in the Premises. PFCU tells
the Court that Jones & Piner is using the Chapter 11 process only
to delay the Sheriff's Sale of the Premises. Jones & Piner has no
realistic hope of proposing a confirmable Plan, nor the financial
wherewithal to complete such a Plan, if confirmed, nor even the
ability to make "adequate protection" payments in the meantime.
Jones & Piner's patent inability to propose a confirmable plan
constitutes an inability to adequately protect PFCU's interest in
the Premises.
PFCU submits that Jones & Piner's inability to adequately protect
the interests of PFCU in the Premises, constitutes cause for relief
from the automatic stay. Moreover, Jones & Piner's unauthorized use
of PFCU's cash collateral also constitutes cause within the meaning
of 11 U.S.C. Section 362(d)(1).
Accordingly, PFCU requests the Court to vacate the automatic stay
to the extent necessary to permit it to exercise its rights as a
secured creditor pursuant to the Note and Mortgage, and state and
federal law, as to the Premises. PFCU avers that Jones & Piner has
no equity in the Premises and that the Premises are not necessary
for an effective reorganization of Jones & Piner, whose principal
resides elsewhere.
Attorneys for PFCU:
William J. Levant, Esq.
Kaplin Stewart Meloff Reiter & Stein, P.C.
910 Harvest Drive
Post Office Box 3037
Blue Bell, PA 19422
Phone: (610)260-6000
About Jones & Piner Real Estate Group
Jones & Piner Real Estate Group, LLC, is a single asset real estate
company. Based in Philadelphia, Pennsylvania, Jones & Piner Real
Estate Group filed a Chapter 11 petition (Bankr. E.D. Pa. Case No.
18-10745) on Feb. 4, 2018, estimating $500,000 to $1 million assets
and $100,000 to $500,000 in liabilities. The petition is signed by
Stephen Piner, managing member. The Debtor is represented by Scot
F. Waterman, Esq. at Waterman & Mayer, LLP, as counsel. The Debtor
hire Philadelphia Realty Exchange, Inc., as its real estate broker.
KMR HOLDINGS: U.S. Trustee Unable to Appoint Committee
------------------------------------------------------
The Office of the U.S. Trustee on March 6 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of KMR Holdings, LLC.
KMR Holdings, LLC, filed for Chapter 11 bankruptcy protection
(Bankr. S.D. Tex. Case No. 18-30241) on Jan. 22, 2018. Donald L.
Wyatt, Esq., at Wyatt & Mirabella PC serves as the Debtor's
bankruptcy counsel.
LAYLA GRAYCE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Layla Grayce, Inc.
570 Colonial Park Drive, #307
Roswell, GA 30075
Business Description: Layla Grayce, Inc., operates an online
boutique that offers customers access to
a variety of products including furniture,
lighting, rugs, pillows, decors and
bedding & bath. The Company is
headquartered
in Roswell, Georgia.
https://www.laylagrayce.com/
Chapter 11 Petition Date: March 9, 2018
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Case No.: 18-54196
Debtor's Counsel: Michael D. Robl, Esq.
ROBL LAW GROUP LLC
3754 LaVista Road, Suite 250
Tucker, GA 30084
Tel: 404-373-5153
Fax: 404-537-1761
E-mail: michael@roblgroup.com
Total Assets: $205,414
Total Liabilities: $3.74 million
The petition was signed by Wendy Estes, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at http://bankrupt.com/misc/ganb18-54196.pdf
LEVERETTE TILE: Delays Filing of Liquidating Plan Until Sale Closes
-------------------------------------------------------------------
Leverette Tile, Inc., doing business as Leverette Home Design
Center, requests the U.S. Bankruptcy Court for the Middle District
of Florida to Extend its Exclusivity Period to file a plan an
additional 60 days after March 5, 2018, or through and including
May 4, 2018.
Without the requested extension, the exclusivity period for this
Debtor to file a plan of reorganization will end on March 5, 2018.
The Debtor is in the process of selling its assets free and clear
of liens and has filed with the Court a motion for authority to
sell its assets and to establish bid procedures. The hearing on
the Debtor's motion to sell its assets has been scheduled for March
6, 2018. The Debtor anticipates that a closing on the sale of its
assets will occur shortly and then the Debtor will be filing a
Chapter 11 Plan of Liquidation.
About Leverette Tile
Leverette Tile, Inc., based in Hudson, Florida, is a kitchen and
bath remodeling contractor and a granite countertop and cabinet
fabricator. Leverette Tile filed a Chapter 11 petition (Bankr.
M.D. Fla. Case No. 17-07840) on Sept. 5, 2017. Brian Leverette,
president, signed the petition. The Debtor estimated $100,000 to
$500,000 in assets and $1 million to $10 million in liabilities as
of the bankruptcy filing. Alberto F. Gomez, Jr., Esq., at Johnson
Pope Bokor Ruppel & Burns, LLP, serves as bankruptcy counsel to the
Debtor. An official committee of unsecured creditors has not yet
been appointed in the Chapter 11 case.
LEVERETTE TILE: Has Until April 2 to Exclusively File Plan
----------------------------------------------------------
The Hon. Catherine Peek McEwen the U.S. Bankruptcy Court for the
Middle District of Florida has extended, at the behest of Leverette
Tile, Inc., the Debtor's exclusivity period during which only the
Debtor can file a Chapter 11 plan and obtain confirmation of the
plan through noon at April 2, 2018, and May 31, 2018,
respectively.
A copy of the Order is available at:
http://bankrupt.com/misc/flmb17-07840-128.pdf
About Leverette Tile
Leverette Tile, Inc., based in Hudson, Florida, is a kitchen and
bath remodeling contractor and a granite countertop and cabinet
fabricator. Leverette Tile filed a Chapter 11 petition (Bankr.
M.D. Fla. Case No. 17-07840) on Sept. 5, 2017. In the petition
signed by Brian Leverette, president, the Debtor estimated $100,000
to $500,000 in assets and $1 million to $10 million in liabilities
as of the bankruptcy filing. Alberto F. Gomez, Jr., Esq., at
Johnson Pope Bokor Ruppel & Burns, LLP, serves as bankruptcy
counsel to the Debtor. An official committee of unsecured
creditors has not yet been appointed in the Chapter 11 case.
LIFE TIME: Moody's Affirms B2 CFR After $200MM Term Loan Add-on
---------------------------------------------------------------
Moody's Investors Service affirmed Life Time, Inc.'s B2 Corporate
Family Rating ("CFR") and B2-PD Probability of Default Rating
following the launch of a $200 million term loan add-on. At the
same time, Moody's also affirmed the B1 rating on Life Time's
upsized senior secured term loan and Caa1 rating on its senior
unsecured notes. The rating outlook remains stable.
Life Time is seeking to raise a $200 million add-on to its existing
$1.3 billion term loan B due June 2022. At the same time, Life Time
is also seeking to increase the size of its revolving credit
facility to $360 million from $250 million. A portion of the
proceeds from the $200 million term loan add-on will be used to
repay about $18 million of revolver borrowings. The remaining
proceeds, along with the increase in revolver capacity, are to
provide incremental liquidity to support Life Time's future club
expansion by providing the company with more flexibility around the
timing of future sale leaseback transactions.
Moody's views the incremental $200 million term loan as a credit
negative as it will increase Life Time's debt to EBITDA to 6.9x for
the year ended December 31, 2017 from 6.5x. In addition, it will
modestly dilute the asset coverage provided to the term loan B as
there will be no change in the existing collateral package.
However, the ratings affirmation with a stable outlook reflects
that Moody's expects the increase in debt to EBITDA will be
temporary as the earnings run rate from the new club openings in
2016 and 2017 supports EBITDA growth such that debt to EBITDA
should reach 6.6x by the end of 2018. In addition, while the asset
coverage will be diluted by the incremental debt, it will remain
solid (at close to an 80% loan to value) and in line with the B2
CFR.
The following ratings are affirmed:
Life Time, Inc.
Probability of Default Rating, Affirmed B2-PD
Corporate Family Rating, Affirmed B2
Senior Secured Bank Credit Facility, Affirmed B1 (LGD3)
Senior Unsecured Regular Bond/Debenture, Affirmed Caa1 to (LGD6)
from (LGD5)
The following rating is assigned:
Life Time, Inc.
$360 million Senior Secured Revolving Credit Facility due 2022 at
B1, (LGD3)
The following rating is withdrawn:
Life Time, Inc.
$250 million Senior Secured Revolving Credit Facility due 2020 at
B1, (LGD3)
Outlook Action:
Outlook, Remains Stable
RATINGS RATIONALE
Life Time's B2 CFR is constrained by the elevated financial risk
associated with its high leverage and financial sponsor ownership.
The rating also reflects the business risks associated with the
highly fragmented fitness club industry including high membership
attrition rates, heavy competition from multiple formats, and the
exposure to both consumer spending trends and economic cycles. Life
Time's CFR also reflects its moderate geographic concentration.
However, Life Time's CFR is supported by its focus on a more
affluent member base and expanded service offerings that largely
insulates it from competition from the value priced fitness clubs.
Favorable demographic trends also support moderate growth within
the US fitness club industry. The CFR also reflects Life Time's
moderate interest coverage with EBITA to interest expense of 1.4
times and adequate liquidity profile. Life Time's high reliance on
external financing such as sale-leaseback transactions, landlord
incentives, and potential revolver borrowings to fund new club
openings can nevertheless pressure liquidity since the company
typically funds the upfront costs prior to obtaining more permanent
financing. Lastly, Life Time's B2 CFR is also supported by its
solid asset based owning roughly half of its clubs of which 29 are
pledged to the bank credit facilities.
The stable rating outlook reflects that Moody's expects the ramp up
in EBITDA from new clubs opened in 2016 and 2017 will drive EBITDA
growth in 2018 that supports debt to EBITDA improving to 6.6 times,
a level that is more in line with expectations for the B2 rating
given the company's operating profile.
Ratings could be upgraded should Life Time sustain Debt to EBITDA
below 5 times and EBITA to interest expense above 2.5 times while
maintaining good liquidity. An upgrade would also require financial
policies that support credit metrics remaining stronger than these
levels.
Ratings could be downgraded should membership levels or pricing
decline resulting in weakness in comparable club revenue growth.
Unanticipated debt increases from higher than expected capital
expenditures or shareholder returns could also pressure ratings.
Quantitatively, ratings could be downgraded should EBITA margins
fall below 15%, debt to EBITDA remain sustained above 6.75 times,
or EBITA to interest expense fall below 1.25 times. A deterioration
in liquidity could also prompt a downgrade.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Headquartered in Chanhassen, MN, Life Time, Inc. operates 130 large
format fitness clubs as of December 31, 2017, mostly in US suburban
locations and one Canadian province. It has over 773,000
subscribing members, as well as close to 98,000 users of its
non-facility based programs. Annual revenues are about $1.6
billion. In June 2015, affiliates of Leonard Green & Partners, TPG
Capital and other investors including founder and CEO Bahram Akradi
purchased the company in an approximate $3.8 billion leveraged
buyout.
LIGHTBRIDGE CORP: Will be Featured in International Journal
-----------------------------------------------------------
Lightbridge Corporation has learned that its innovative nuclear
fuel will be featured in the April 2018 edition of Nuclear
Engineering and Design, an international journal devoted to all
aspects of nuclear fission energy. The article, entitled
"Proliferation resistant plutonium: An updated analysis," explores
the proliferation resistance of Lightbridge's fuel. The authors
performed an independent evaluation via computer simulation of
Lightbridge's fuel design for a pressurized water reactor and came
to the conclusion that the resultant plutonium would be useless in
current nuclear weapon designs.
Investors are encouraged to read the article in its entirety,
including important assumptions and limitations discussed therein.
Lightbridge has not evaluated the methodology used by the authors
or the claims or conclusions set forth in the article. Lightbridge
expressly disclaims any responsibility for the contents of the
article and expressly disclaims any duty to update any information
contained in the article, except as required by law.
About Lightbridge
Lightbridge, based in Reston, Virginia -- http://www.ltbridge.com/
-- is a nuclear fuel technology company participating in the
nuclear power industry in the United States and internationally.
The Company's mission is to be a world leader in the design and
commercialization of nuclear fuels that it anticipates will be
economically attractive, enhance reactor safety, be proliferation
resistant, and produce less waste than current generation nuclear
fuels, and to provide world-class strategic advisory services to
governments and utilities seeking to develop or expand civil
nuclear power programs.
Lightbridge reported a net loss attributable to common shareholders
of $7 million in 2016 following a net loss attributable to common
shareholders of $4.31 million in 2015. As of Sept. 30, 2017,
Lightbridge had $6.86 million in total assets, $1.32 million in
total liabilities and $5.53 million in total stockholders' equity.
BDO USA, LLP, in Philadelphia, Pennsylvania, issued a "going
concern" opinion in its report on the consolidated financial
statements for the year ended Dec. 31, 2016, noting that the
Company has suffered recurring losses from operations and has an
accumulated deficit that raises substantial doubt about its ability
to continue as a going concern.
LONG BLOCKCHAIN: Appoints Loretta Joseph to Board of Directors
--------------------------------------------------------------
Long Blockchain Corp. announced the appointment of Loretta Joseph
to the Company's Board of Directors. Ms. Joseph will serve as an
independent director.
Ms. Joseph has over 25 years of experience in the global financial
services industry, and is a Blockchain and technology advisor to
companies, organizations and governments. She has held senior
positions at investment banks across Asia and India where she was
responsible for managing multiple asset classes and emerging
markets environments, including RBS, Macquarie Group, Deutsche
Bank, Credit Suisse and Elara Capital. Ms. Joseph has advised
international banks, and global hedge and pension funds in the
areas of portfolio management and exposure to derivatives and
related products in emerging markets.
Ms. Joseph serves as the Chair of the Advisory Board of ADCCA
(Australian Digital Currency and Commerce Association), an advocacy
group dedicated to ensuring the responsible adoption of Blockchain
regulation. She also sits on the advisory boards of UWS Business
School and Blume Ventures, one of India's leading tech-focused
early stage VCs, and is an adjunct fellow at UWS Australia. She
received Fintech Australia's "FinTech Leader of 2017" and "Female
Leader of 2016" awards, and the "Alumni Award for Social Impact" in
2016 from Sancta Sophia College.
Shamyl Malik, chief executive officer of the Company, stated,
"Loretta brings an exceptional record of achievement in global
financial services and Blockchain advocacy, and we are fortunate to
have her as a member of our Board. She embodies the type of
individual we are seeking to help lead our continuing progression
towards developing scalable and sustainable Blockchain solutions
for the global financial markets."
Ms. Joseph added, "I am impressed with Long Blockchain's strategy
and evolving platform, and share the Company's optimism for this
emerging and exciting industry."
As a non-employee director of the Company, Ms. Joseph will receive
an annual cash fee of $30,000 and an annual award of $35,000 in
shares of the Company's Common Stock valued as of December 31st of
each year. In addition, the Company will enter into an
indemnification agreement with Ms. Joseph, pursuant to which the
Company will indemnify, and advance expenses to, Ms. Joseph to the
fullest extent permitted by applicable law.
About Long Blockchain Corp.
Headquartered in Hicksville, New York, Long Blockchain Corp.,
formerly Long Island Iced Tea Corp., is focused on developing and
investing in globally scalable blockchain technology solutions. It
is dedicated to becoming a significant participant in the evolution
of blockchain technology that creates long term value for its
shareholders and the global community by investing in and
developing businesses that are "on-chain". Blockchain technology is
fundamentally changing the way people and businesses transact, and
the Company will strive to be at the forefront of this dynamic
industry, actively pursuing opportunities. Its wholly-owned
subsidiary Long Island Brand Beverages, LLC operates in the
non-alcohol ready-to-drink segment of the beverage industry under
its flagship brand 'The Original Long Island Brand Iced Tea'.
Long Island Iced Tea incurred a net loss of $10.44 million for the
year ended Dec. 31, 2016, following a net loss of $3.18 million for
the year ended Dec. 31, 2015. As of Sept. 30, 2017, the Company had
$4.83 million in total assets, $4.21 million in total liabilities
and $622,151 in total stockholders’ equity.
"Historically, the Company has financed its operations through the
raising of equity capital and through trade credit with its
vendors. The Company's ability to continue its operations and to
pay its obligations when they become due is contingent upon the
Company obtaining additional financing. Management's plans include
raising additional funds through equity offerings, debt financings,
or other means.
"The Company believes that it will be able to raise sufficient
additional capital to finance the Company's planned operating
activities. There are no assurances that the Company will be able
to raise such capital on terms acceptable to the Company or at all.
If the Company is unable to obtain sufficient amounts of
additional capital, it may be required to reduce the scope of its
planned market development activities, and/or consider reductions
in personnel costs or other operating costs. These conditions
raise substantial doubt about the Company's ability to continue as
a going concern," the Company stated in its quarterly report for
the period ended Sept. 30, 2017.
LOTUS INDUSTRIES: Hires Andrew A. Paterson, Jr. Counsel
-------------------------------------------------------
Lotus Industries, LLC, seeks authority from the U.S. Bankruptcy
Court for the Eastern District of Michigan, Southern Division, to
employ Andrew A. Paterson, Jr., as its counsel.
Services to be rendered by Mr. Paterson are:
(a) advise and represent Lotus with respect to all matters and
proceedings in this Chapter 11 case and to prepare on behalf of
Lotus necessary applications, motions, answers, orders, reports,
and other legal papers;
(b) assist Lotus in all bankruptcy issues which may arise in
the administration of Lotus' affairs, including representation at
the first meeting of creditors, evaluation of assets, negotiations
with creditors, interest groups, and any Official Committee of
Unsecured Creditors, verification of claims, and asset
disposition;
(c) assist Lotus with the preparation of and confirmation of a
plan of reorganization;
(d) assist Lotus in the evaluation and prosecution of claims
and litigation;
(e) provide legal services with respect to general corporate,
tax, employee benefit, and other general non-
bankruptcy matters; and
(g) perform all other necessary legal services and provide all
other necessary legal advice to Lotus in connection with this
Chapter 11 case and its business operations.
Mr. Paterson attests that he does not hold or represent any
interest adverse to Lotus, and does not have any connection with
Lotus, its creditors, any other party in interest, its respective
attorneys and accountants, the United States Trustee, or any person
employed in the office of the United States Trustee.
Mr. Paterson has agreed to only be compensated in the amount of
$2,000 a month for services rendered in this Chapter 11 case.
The attorney can be reached through:
Andrew A. Paterson. Esq.
2893 E. Eisenhower Pkwy
Ann Arbor, MI 48108
Phone: (248) 568-9712
Email: aap43@outlook.com
Lotus Industries LLC sought Chapter 11 protection (Bankr. E.D.
Mich. Case No. 18-40621) on Jan. 18, 2018, estimating less than $1
million in both assets and liabilities. Andrew A. Paterson, Jr.,
Esq., at the PATERSON LAW OFFICE, serves as counsel to the Debtor.
MADISON-LARAMIE SELF STORAGE: Taps Chuhak & Tecson as Counsel
-------------------------------------------------------------
Madison-Laramie Self Storage, LLC, seeks authority from the U.S.
Bankruptcy Court for the Northern District of Illinois, Eastern
Division, to employ Miriam R. Stein, Michael D. Leifman, Shweta Van
Beveren and the partners and associates of the law firm of Chuhak &
Tecson, P.C. as its bankruptcy counsel.
Services to be provided by C&T are:
a. prepare necessary applications, motions, answers, orders,
adversary proceedings, reports and other legal papers for
presentation to this Court;
b. provide the Debtor with respect to its rights and duties
involving its property as well as its reorganization efforts,
including preparing a Plan of Reorganization;
c. negotiate with creditors in this case;
d. appear before this Court and to litigate any issues, when
necessary; and
e. perform any and all other legal services that may be
required from time to time in the ordinary course of the Debtor’s
business during the administration of this bankruptcy case.
C&T's hourly rates professionals primarily assigned to the case
are:
Miriam Stein (Principal) $350
Michael Leifman (Associate) $285
Shweta Van Beveren (Associate) $385
Lynda Reuther (Paralegal) $215
The hourly rates of other professionals that may render services
are:
Partners $300 to $350
Associates $350 to $385
Paralegal $175 to $215
Miriam Stein, Esq., a partner at the firm, attests the she and all
partners and associates are "disinterested" within the meaning of
Sections 101(14) and 327 of the Bankruptcy Code.
The firm can be reached through:
Miriam R. Stein, Esq.
CHUHAK & TECSON, P.C.
30 S. Wacker Dr., Ste. 2600
Chicago, IL 60606
Tel.: (312)444-9300
Email: vmstein@chuhak.com
On Jan. 16, 2018, Madison-Laramie Self Storage, L.L.C., sought
Chapter 11 protection (Bankr. N.D. Ill. Case No. 18-01228)
estimating less than $1 million in both assets and liabilities.
MANHATTAN JEEP: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Affiliates that filed voluntary petitions for relief under Chapter
11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Manhattan Jeep Chrysler Dodge, Inc. 18-10657
dba Manhattan Jeep Chrysler Dodge
678 11th Avenue
New York, NY 10019
Manhattan Automotive, L.L.C. 18-10661
dba Alfa Romeo Fiat of Manhattan
629 West 54th Street
New York, NY 10019
Business Description: Manhattan Jeep Chrysler Dodge, Inc. is a
family-owned and operated car dealer based
in New York. Manhattan Jeep offers a
collection of both new and used cars to
customers in Manhattan, Queens, the Bronx,
and surrounding areas. The Company also
offers car services including oil changes
and engine and transmission repairs. It
also provides state inspections and free
body shop estimates and sells vehicle
parts.
https://www.manhattanjeepchryslerdodge.com/
Chapter 11 Petition Date: March 9, 2018
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Hon. Michael E. Wiles
Debtors' Counsel: Eric J. Snyder, Esq.
WILK AUSLANDER LLP
1515 Broadway, 43rd Floor
New York, NY 10036
Tel: (212) 981-2300
Fax: (212) 752-6380
E-mail: esnyder@wilkauslander.com
Assets and Liabilities:
Estimated Estimated
Assets Liabilities
---------- -----------
Manhattan Jeep $1 mil.-$10 million $10 mil.-$50 million
Manhattan Auto. $500,000-$1 million $1 mil.-$10 million
The petitions were signed by Patrick Monninger, president of
Manhattan Jeep.
A full-text copy of Manhattan Jeep's petition containing, among
other items, a list of the Debtor's 20 largest unsecured creditors
is available for free at http://bankrupt.com/misc/nysb18-10657.pdf
A full-text copy of Manhattan Automotive's petition containing,
among other items, a list of the Debtor's 20 largest unsecured
creditors is available for free at:
http://bankrupt.com/misc/nysb18-10661.pdf
MCCLATCHY CO: Bluestone 5.16% of Shares as of March 2
-----------------------------------------------------
Bluestone Financial Ltd. reported in a Schedule 13G filed with the
Securities and Exchange Commission that as of March 2, 2018, it
beneficially owns 270,678 shares of Class A common stock, $0.01 par
value per share, of The McClatchy Company, constituting 5.16
percent of the shares outstanding. A full-text copy of the
regulatory filing is available for free at:
https://is.gd/UCs96v
About McClatchy
McClatchy operates 30 media companies in 14 states, providing each
of its communities with news and advertising services in a wide
array of digital and print formats. McClatchy is a 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 is
headquartered in Sacramento, Calif., and listed on the New York
Stock Exchange American 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 $300.2 million for the
year ended Dec. 27, 2015. As of Sept. 24, 2017, the Company had
$1.51 billion in total assets, $1.77 billion in total liabilities
and a stockholders' deficit of $258.65 million.
* * *
McClatchy continues to hold Moody's Investors Service's "Caa1"
corporate family rating. In December 2015, Moody's affirmed the
"Caa1" corporate family rating rating 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 cash-flow. McClatchy's Caa1 Corporate Family
Rating reflects persistent revenue pressure on the company's
newspaper and print operations, reliance on cyclical advertising
spending, and its high leverage including a large underfunded
pension.
MDM PHYSICAL: Taps Richardson & Richardson as Legal Counsel
-----------------------------------------------------------
MDM Physical Therapy, LLC, received approval from the U.S.
Bankruptcy Court for the District of Arizona to hire Richardson &
Richardson, P.C. as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; assist in the preparation of a plan of
reorganization; and provide other legal services related to its
Chapter 11 case.
William Richardson, Esq., the attorney who will be handling the
case, charges an hourly fee of $375. Paralegals and
paraprofessionals charge $175 per hour.
Richardson & Richardson does not represent any interest adverse to
the Debtor or its estate, according to court filings.
The firm can be reached through:
William R. Richardson, Esq.
Richardson & Richardson, P.C.
1745 South Alma School Road
Corporate Center, Suite 100
Mesa, AZ 85210-3010
Phone: (480) 464-0600
Fax: (480) 464-0602
Email: wrichlaw@aol.com
About MDM Physical Therapy
Founded in 2001, MDM Physical Therapy LLC is a small organization
in the health practitioners industry located in Gilbert, Arizona.
MDM Physical Therapy sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Ariz. Case No. 18-01596) on Feb. 21,
2018. Judge Paul Sala presides over the case. At the time of the
filing, the Debtor estimated assets and liabilities of less than
$500,000.
MEDIACOM COMMUNICATIONS: S&P Affirms BB CCR, Alters Outlook to Pos.
-------------------------------------------------------------------
U.S. cable provider Mediacom Communications Corp. continues to grow
earnings and use free operating cash flow (FOCF) to reduce debt
such that leverage is at our upgrade trigger of 3.5x for the 12
months ended Dec. 31, 2017, down from about 4.0x in 2016.
S&P Global Ratings affirmed all ratings on Blooming Grove,
N.Y.-based Mediacom Communications Corp., including the 'BB'
corporate credit rating, and revised the outlook to positive from
stable.
The outlook revision reflects the potential for continued
improvement in credit metrics, as long as the company does not make
a sizeable acquisition or dividend. Since being taken private by
controlling shareholder Rocco Commisso in 2011, the company has
consistently used internal cash generation for debt reduction.
This, combined with healthy and predictable growth in the company's
profitable high-speed data (HSD) business, has enabled debt to
EBITDA to diminish to 3.5x in 2017 from over 6x at the time of the
buyout. Still, given that the company does not have a public
leverage target, S&P believes there is some uncertainty around its
financial policy.
S&P said, "The positive outlook reflects our expectation that
leverage will approach 3.0x by the end of 2018 from 3.5x in 2017,
based on debt repayment and moderate earnings growth from growth in
HSD and business services segments which more than offset declines
in video. However, there is some uncertainty as to whether leverage
will stay below 3.5x given the potential for acquisitions or a
dividend, which weighs on an upgrade at this time.
"We could raise the rating over the next year if management
continues to demonstrate a commitment to de-leveraging, such that
we believe leverage will remain below 3.5x on a sustained basis.
Before upgrading the company, we require leverage to be closer to
3.0x to build in some cushion for smaller acquisitions that we
believe are possible.
"Given our expectations for relatively steady operating performance
over the next year, we expect an outlook revision to stable would
more likely result from debt-financed acquisitions or shareholder
returns that keep leverage in the 3.5x-4.5x range. This could occur
from a dividend of up to $1 billion or an acquisition up to $3
billion assuming a 10x multiple. Although unlikely, anything larger
than that could result in a lower rating."
MERCYFULL HOME: Case Summary & 2 Unsecured Creditors
----------------------------------------------------
Debtor: Mercyfull Home Health Inc.
17111 Simon Court
Richmond, TX 77407
Business Description: Mercyfull Home Health Inc. is a
home health care services provider based
in Richmond, Texas, that offers skilled
nursing, physical therapy, occupational
therapy, speech pathology, medical social
worker and home health aide.
Chapter 11 Petition Date: March 9, 2018
Case No.: 18-31207
Court: United States Bankruptcy Court
Southern District of Texas (Houston)
Judge: Hon. Karen K. Brown
Debtor's Counsel: Candice Wagner, Esq.
THE LAW OFFICE OF CANDICE L. WAGNER, PC
1790 Hughes Landing Boulevard, Suite 400
The Woodlands, TX 77380
Tel: 281-750-5741
E-mail: cwagner@lawwagner.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Mercy Grant, administrator.
A copy of the Debtor's list of two unsecured creditors is available
for free at:
http://bankrupt.com/misc/txsb18-31207_creditors.pdf
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/txsb18-31207.pdf
MONAKER GROUP: Reduces Pacific Grove Warrants Exercise Prices
-------------------------------------------------------------
Monaker Group, Inc. has entered into a first amendment to warrant
agreement with Pacific Grove Capital LP, one of the purchasers of
shares and warrants pursuant to the terms of that certain Common
Stock and Warrant Purchase Agreement entered into between the
Company and the purchasers dated July 31, 2017.
Pursuant to the Amendment, the Company and Pacific agreed to reduce
the exercise price of the warrants to purchase 147,000 shares of
common stock which Pacific was granted as penalty warrants in
connection with the Company's prior failure to obtain the timely
listing of its common stock on the Nasdaq Capital Market(which
uplisting occurred on Feb. 22, 2018), from $5.125 per share to
$2.625 per share, in consideration for Pacific immediately
exercising those warrants for cash.
Total consideration received from the exercise of the warrants by
Pacific pursuant to the Amendment was $385,875.
Previously, on Jan. 10, 2018, as reported in the Current Report on
Form 8-K filed by the Company with the Securities and Exchange
Commission on Jan. 16, 2018, the Company and Pacific entered into
an amendment agreement, to among other things, amend the exercise
price of the warrants to purchase 350,000 shares of common stock
granted to Pacific pursuant to the Purchase Agreement and warrants
to purchase 108,500 shares of common stock granted to Pacific as
prior penalty warrants for the failure to timely uplist to Nasdaq
to from $5.25 per share to $2.625 per share, in consideration for
Pacific immediately exercising such warrants for cash.
Pursuant to the anti-dilution provisions of the Purchase Agreement,
the Purchasers are due their pro rata portion (less one of the
Purchasers who has waived such rights) of an aggregate of an
additional 4,390 shares of common stock in connection with the
reduction in exercise price of the warrants held by Pacific as
described above and the exercise price of all of the other
un-exercised warrants previously granted to the Purchasers and the
Agent were automatically reduced to $5.09 per share.
About Monaker
Headquartered in Weston, Florida, Monaker Group, Inc., formerly
known as Next 1 Interactive, Inc. -- http://www.monakergroup.com/
-- operates online marketplaces for the alternative lodging rental
industry and facilitate access to alternative lodging rentals to
other distributors. Alternative lodging rentals (ALRs) are whole
unit vacation homes or timeshare resort units that are fully
furnished, privately owned residential properties, including homes,
condominiums, apartments, villas and cabins that property owners
and managers rent to the public on a nightly, weekly or monthly
basis. The Company's marketplace, NextTrip.com, unites travelers
seeking ALRs online with property owners and managers of vacation
rental properties located in countries around the world. As an
added feature to the Company's ALR offering, the Company also
provides access to airline, car rental, hotel and activities
products along with concierge tours and activities, at the
destinations, that are catered to the traveler through its
Maupintour products.
LBB & Associates Ltd. LLP, in Houston, Texas, stated in its report
on the Company's consolidated financial statements for the year
ended Feb. 28, 2017, that the Company's accumulated deficit and
limited financial resources raise substantial doubt about the
Company's ability to continue as a going concern.
Monaker reported a net loss of $7.10 million for the year ended
Feb. 28, 2017, compared to a net loss of $4.55 million for the year
ended Feb. 29, 2016. As of Nov. 30, 2017, Monaker Group had $8.62
million in total assets, $4.68 million in total liabilities and
$3.94 million in total stockholders' equity.
MOUNTAIN CREEK RESORT: Has Until April 8 to Exclusively File Plan
-----------------------------------------------------------------
The Hon. Stacey L. Meisel of the U.S. Bankruptcy Court for the
District of New Jersey has extended Mountain Creek Resort, Inc.,
and its debtor-affiliates' exclusive period during which only the
Debtors can file a plan of reorganization and solicit acceptance of
the plan through and including April 8, 2018, and June 6, 2018,
respectively.
As reported by the Troubled Company Reporter on Feb. 22, 2018, the
Debtors asked the Court to extend the exclusive periods during
which only the Debtors can file a plan and solicit acceptance of
the plan through and including April 23, 2018, and June 21, 2018,
respectively.
These Chapter 11 cases involve six debtors that have diverse
creditor groups and interests. The Chapter 11 cases are large and
complex, involving multiple layers of funded secured debt (M&T,
Kuzari and HSK), obligations to municipal authorities, noteholders,
personal injury claimants, and trade debt. Particularly, in
addition to addressing the substantial secured debt owed to M&T and
other parties, the Debtors must address or otherwise resolve the
substantial Vernon Claims, various stay relief requests from
personal injury and other litigation claimants, and issues
regarding the Prior Owner Notes. The Debtors will use the extended
Exclusive Periods to address these issues and claims.
A copy of the Order is available at:
http://bankrupt.com/misc/njb17-19899-510.pdf
About Mountain Creek Resort
Mountain Creek Resort, Inc., owns and operates the Mountain Creek
Resort, a four-season resort located in Vernon, New Jersey. The
Resort is the New York/New Jersey Metro area's closest ski resort
with 167 skiable acres on four mountain peaks, 1,040 vertical feet,
46 trails, and 11 lifts. The Resort also operates and manages the
Appalachian Hotel and the Black Creek Sanctuary townhomes.
Mountain Creek Resort, Inc., and five affiliated debtors filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D.N.J. Lead Case No. 17-19899) on May 15, 2017. The
cases are pending before the Honorable Judge Stacey L. Meisel, and
jointly administered.
Mountain Creek estimated $10 million to $50 million in assets and
debt.
The Debtors hired Lowenstein Sandler LLP as bankruptcy counsel;
Houlihan Lokey Capital, Inc., as business consultant and investment
banker; and Prime Clerk LLC as claims and noticing agent.
On May 24, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. Trenk, DiPasquale,
Della Fera & Sodono, P.C., is the Committee's bankruptcy counsel.
NORFOLK STREET: Taps DelBello Donnellan Weingarten as Attorney
--------------------------------------------------------------
Norfolk Street Management LLC seeks authority from the U.S.
Bankruptcy Court for the Eastern District of New York to hire
DelBello Donnellan Weingarten Wise & Wiederkehr, LLP as its
attorneys.
Professional services DDW will render are:
a. give advice to the Debtor with respect to its powers and
duties as Debtor-in-Possession and the continued management of its
property and affairs;
b. negotiate with creditors of the Debtor and work out a plan
of reorganization and take the necessary legal steps in order to
effectuate such a plan including, if need be, negotiations with the
creditors and other parties in interest;
c. prepare the necessary answers, orders, reports and other
legal papers required for the Debtor’s protection from its
creditors under Chapter 11 of the Bankruptcy Code;
d. appear before the Bankruptcy Court to protect the interest
of the Debtor and to represent the Debtor in all matters pending
before the Court;
e. attend meetings and negotiate with representatives of
creditors and other parties in interest;
f. advise the Debtor in connection with any potential sale of
the business;
g. represent the Debtor in connection with obtaining
post-petition financing, if necessary;
h. take any necessary action to obtain approval of a
disclosure statement and confirmation of a plan of reorganization;
i. perform all other legal services for the Debtor which may
be necessary for the preservation of the Debtor's estate and to
promote the best interests of the Debtor, its creditors and its
estate.
DDW's hourly rates are:
Attorneys $375 to $620
Law Clerks $200
Legal Assistants/ Paralegals $150
Julie Cvek Curley, Esq., partner at the firm, attests that DDW is a
"disinterested person" as defined in Bankruptcy Code Sec. 101(14),
and DDW's employment is necessary and in the best interest of the
Debtor and its estate.
The firm can be reached through:
Jonathan S. Pasternak, Esq.
Julie Cvek Curley, Esq.
DELBELLO DONNELLAN WEINGARTEN
WISE &WIEDERKEHR, LLP
One North Lexington Avenue
White Plains, NY 10601
Phone: (914) 681-0200
About Norfolk Street Management
Norfolk Street Management LLC is a privately held company engaged
in activities related to real estate. Its principal assets are
located at 46 East 82nd Street New York, NY 10028. Norfolk Street
filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 18-10113) on
Jan. 17, 2018. The Debtor estimated assets and liabilities at $10
million to $50 million. Dawn Kirby, Esq., at DELBELLO DONNELLAN
WEINGARTEN WISE & WIEDERKEHR, LLP, is the Debtor's counsel.
NUSTAR ENERGY: Fitch Affirms BB IDR & Alters Outlook to Negative
----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Rating
(IDR) for NuStar Energy, L.P. (NuStar) and NuStar Logistics, L.P.'s
(Logistics) at 'BB'. The senior unsecured rating for Logistics is
affirmed at 'BB'/'RR4' and the junior subordinated notes at
'B+'/'RR6'. The preferred equity ratings at NuStar have also been
affirmed at 'B+'/'RR6.' Fitch has also revised NuStar and
Logistics' Rating Outlook to Negative from Stable.
The revision in Outlook represents Fitch's expectation that
contract roll-off in the Eagle Ford minimum volume commitments,
potential weakness in storage revenues stemming from capacity
leased to Petroleos de Venezuela S.A.'s (PDVSA), whose Long-Term
Foreign Currency IDR was recently downgraded to 'C', and high
growth capital spending will lead to elevated leverage at NuStar in
2018. Fitch believes that management has taken some steps to
address elevated leverage, but there remains some execution risk
around funding options and operating performance.
Additionally, Fitch is concerned that liquidity could be further
constricted by NuStar's ability to borrow under its revolving
credit facility. NuStar's ability to draw on the revolver is
restricted by a leverage covenant as defined by the bank agreement,
which does not allow leverage to be greater than 5x for covenant
compliance or 5.5x following a qualifying acquisition. Nustar is
currently subject to a 5.5x consolidated debt coverage ratio
post-Navigator transaction, however, this covenant steps back down
to 5.0x in the second quarter of 2018 (2Q18), which could lead to
future liquidity constriction. Fitch expects NuStar to remain
covenant compliant; however, the margin for operating
underperformance is limited. Fitch notes that the covenant
calculation allows for the exclusion of its junior subordinated
notes, debt proceeds held in escrow for the future funding of
construction and preferred equity, to which Fitch applies 50% debt
credit in its metric calculations and allows for the inclusion of
pro forma EBITDA for material projects and acquisitions, which
should provide some cushion to covenant calculations.
KEY RATING DRIVERS
Elevated Leverage: NuStar's leverage is expected to be elevated in
2018 above Fitch's prior expectations. Fitch expects high growth
capital spending, the roll off of some minimum volume commitments
in the Eagle Ford and expected underperformance in storage segments
stemming from the PDVSA troubles will keep leverage elevated in the
5.8x to 6.2x range in 2018, well above prior expectations of
deleveraging closer to 5.0x. Fitch expects leverage to remain high
in 2019, but improve in 2019 and 2020 depending on NuStar's
operating performance, including continued volume growth in the
Permian and its ability to replace volumes that could be
potentially lost on its Eagle Ford system and either utilization by
PDVSA of its St. Eustatious capacity or a replacement of capacity
utilization with other customers. Fitch would likely take further
negative ratings action if it were to expect 2019 leverage in the
5.8x to 6.0x range based on Fitch calculations, which apply 50%
debt credit to NuStar's junior subordinated notes and preferred
equity.
Structural Simplification and Distribution Cut: In response to
weak distribution coverage and high leverage, NuStar announced
plans to merge with its general partner and eliminate its
associated incentive distribution rights. Concurrent with this
merger, Nustar will cut its distribution to $0.60 per unit
quarterly, which is expected to increase distribution coverage to
1.2x; under the deal Nustar will exchange 0.55 common units for
every NuStar GP Holding, LP (NSH) units. The transaction is
expected to close in the 2Q18, subject to NSH shareholder approval.
NuStar just needs a simple majority of NSH holders to vote in
agreement and William Greehey who owns roughly 21% of NSH units has
agreed to vote in the affirmative for the transaction. Fitch views
the merger and distribution cut to be necessary steps for the
partnership if it hopes to effectively delever its balance sheet to
management's stated target of leverage (based on its revolver
covenant calculation) of 4.0x to 4.3x by the end of 2019.
Operating Performance Uncertainty: The Negative Outlook reflects
Fitch's growing concern that underperformance at Nustar's storage
assets and existing Eagle Ford operations and slower than expected
growth at NuStar's Permian acquisition assets will lead to higher
than expected leverage and constrained liquidity. NuStar's 2018
results have the potential to be negatively impacted by storage
segment exposure to PDVSA, which holds a significant amount of
NuStar's St. Eustatious Terminal's storage capacity. Management has
indicated this capacity may be underutilized this year resulting in
a potential $75 million decline in 2018 EBITDA. However, to date,
PDVSA has been using the terminal capacity and management has
indicated that while capacity utilization and activity has been
less than expected NuStar continues to have a good relationship
with the customer and has not had to take any bad-debt write downs
associated with PdVSA's obligations to NuStar. Additionally,
NuStar's Eagle Ford pipeline system is experiencing volumetric
shipments that are below minimum volume commitments as producers
focus production activity at more favorable basins. Revenue to this
point at NuStar's Eagle Ford pipeline has been supported by minimum
volume commitments (MVCs) which begin to roll off in August 2018.
Fitch expects this will weigh on Eagle Ford revenues as expiring
volumes either go away or are shipped at significantly lower
rates.
Funding Execution Risk: Management has indicated it expects to fund
its capital needs in 2018 with preferred equity and or potential
asset sales. While the preferred equity markets have been receptive
to energy preferred offerings, Fitch projects capital funding needs
of between $300 million and $500 million for NuStar in 2018. Fitch
believes that there is execution risk around NuStar's ability to
raise all of its capital needs in preferreds at favorable rates,
leading to the potential for additional increases to leverage and
or potential asset sales. Management has indicated that it expects
to delever and has levers to pull including asset sales and
discretionary capital expenditure decreases to support its
deleveraging plans if needed.
DERIVATION SUMMARY
The 'BB' rating reflects NuStar's size and scale, and elevated
leverage. NuStar currently has a higher leverage profile than its
investment-grade peers which operate in the crude oil, refined
products pipelines and storage terminal segments, such as Buckeye
Partners LP (BPL; BBB-/Stable). Fitch forecasts NuStar's leverage
to be 5.8x-6.2x by year-end 2018, which is significantly higher
than BPL which had leverage below 5.0x as of year-end 2017.
NuStar's leverage is higher than similarly rated 'BB' midstream
energy issuers like Sunoco, LP, which Fitch expects to have 2018
leverage in the 4.5x to 5.0x range, and Amerigas Partners, LP had
trailing four quarters leverage at Sept. 30, 2017 of 4.5x, NuStar,
however, generates more stable operating cash flow and exhibits
lower leverage compared to NGL Energy Partners LP (B/Negative),
which also has operations in the refined products segment. NuStar
is smaller and less diverse than other peers such as Plains All
American LP (BBB-/Negative) and Energy Transfer Partners
(BBB-/Stable), whose size and scale provide operational and
geographic diversification as well as advantage in accessing the
capital markets.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Fitch Rating Case for the Issuer
-- Merger with NSH is completed early in the 2Q18 at terms
consistent with the announced plans.
-- Concurrent with the merger NuStar's distribution is cut to
$0.60/quarter and held flat 2018-2019;
-- Capital spending in 2018 in the $350 million-$500 million
range inclusive of maintenance capital of $60 million to $70
million annually;
-- Funding needs met with a combination of preferred equity
offerings, asset sales and revolver borrowings, with Fitch
applying 50% equity credit to NuStar's existing preferred
equity and junior subordinated notes and to its future
offerings.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Fitch would likely stabilize its Outlook if NuStar is able to
meet its 2018 funding needs in a manner that helps improve
leverage and operating performance trends are consistent with
current guidance.
-- While not expected in the near term, Fitch may take positive
rating action if leverage falls below 5.0x for a sustained
period of time provided that distribution coverage is at or
above 1.0x.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Lack of access to capital markets; Inability to access
preferred equity markets or complete asset sales in order to
meet funding needs. Leverage between 5.8x and 6.0x expected in
2019 based on Fitch calculations could lead to a downgrade.
-- Failure to reduce growth capex if availability to fund growth
is restricted or too heavily dependent on debt;
-- Reduced liquidity;
-- Significant increases in capital spending beyond Fitch's
expectations that have negative consequences for the credit
profile.
LIQUIDITY
Liquidity Constrained: Fitch is concerned that liquidity could be
further constricted by NuStar's ability to borrow under its
revolving credit facility. NuStar's ability to draw on the revolver
is restricted by a leverage covenant as defined by the bank
agreement, which does not allow leverage to be greater than 5x for
covenant compliance or 5.5x following a qualifying acquisition.
Nustar is currently subject to a 5.5x consolidated debt coverage
ratio post-Navigator transaction, however, this covenant steps back
down to 5.0x in the 2Q18 which could lead to future liquidity
constriction. As of Dec. 31, 2017, NuStar had $893.3 million of
borrowings outstanding under its revolving credit agreement. NuStar
was in compliance with its covenants at yearend. Fitch expects
NuStar to remain covenant compliant; however, the margin for
underperformance is limited. Fitch notes that the covenant
calculation allows for the exclusion of its junior subordinated
notes, debt proceeds held in escrow for the future funding of
construction and preferred equity, and allows for the inclusion of
pro forma EBITDA for material projects and acquisitions which
should provide some cushion to covenant calculations.
NuStar also has access to two short-term lines of credit with
uncommitted borrowing capacity of $85 million. As of Dec. 31, 2017,
there was $35 million of borrowing availability on these lines. In
June 2015, NuStar established a $125 million receivable financing
agreement that can be upsized to $200 million. As of Dec. 31, 2017,
it had $62.3 million of borrowings outstanding under the
Receivables Financing Agreement. On Sept. 20, 2017, NuStar amended
the securitization program and added certain NuStar Energy wholly
owned subsidiaries resulting from the Navigator acquisition. The
securitization program's scheduled termination date was extended
from June 15, 2018 to Sept. 20, 2020, with the option to renew for
additional 364-day periods thereafter. NuStar has $350 million of
notes due in April 2018, which Fitch currently expects to be
refinanced.
FULL LIST OF RATING ACTIONS
Fitch has affirmed the following ratings:
NuStar Energy, L.P.
-- Long-Term Issuer Default Rating (IDR) at 'BB';
-- Perpetual preferred equity at 'B+'/'RR6'.
NuStar Logistics, L.P.
-- Long-Term IDR at 'BB';
-- Senior unsecured notes at 'BB'/'RR4';
-- Junior subordinated notes at 'B+'/'RR6'.
The Rating Outlook for both entities has been revised to Negative
from Stable.
OAKTREE SPECIALTY: S&P Raises ICR & Sr. Unsec. Notes Rating to BB+
------------------------------------------------------------------
S&P Global Ratings said it raised its issuer credit rating on
Oaktree Specialty Lending Corp. to 'BB+' from 'BB'. The outlook is
stable. S&P also raised the issue rating on the company's senior
unsecured notes to 'BB+' from 'BB'.
Rationale
S&P's rating on Oaktree reflects the company's poorly performing
legacy investments, offset by very low leverage and a diversified
funding profile.
Outlook
S&P said, "The stable outlook reflects our expectation that the
company will operate with leverage as measured by debt to total
adjusted equity of 0.70x to 0.85x in the long term. Our base case
scenario incorporates our expectation that the company will
continue to realize losses and operate with elevated non-accruals
over the next 12 months as the company remediates legacy assets.
"We could lower the rating if the company's leverage increases
above 0.85x on a sustained basis or if the company's nonaccruals or
realized and unrealized losses materially deteriorate. We could
also lower the rating if the company's newly originated investments
do not perform as expected.
"While we do not anticipate an upgrade in the next 12 months, we
expect an upgrade would depend on at least a full year of strong
investment performance, including controlled levels of nonaccrual
loans in the portfolio and improving trends in realized and
unrealized losses. An upgrade would also likely depend on
successfully refinancing the upcoming $250 million in unsecured
notes due 2019 while maintaining staggered maturities and financial
flexibility."
OMINTO INC: Submits its Plan to Regain Nasdaq Compliance
--------------------------------------------------------
Ominto, Inc., submitted its plan to regain compliance to Nasdaq on
March 5, 2018.
The Company received a letter from Nasdaq on March 1, 2018, which
supersedes its letter dated Feb. 22, 2018 and indicates that the
Company is not in compliance with Nasdaq's continued listing
requirements under the timely filing criteria outlined in Listing
Rule 5250(c)(1). Due to the delay in filing its annual report on
Form 10-K for the year ended Sept. 30, 2017, the Company has been
unable to file its quarterly report on Form 10-Q for the quarter
ended Dec. 31, 2017 with the U.S. Securities and Exchange
Commission.
The letter states that the Company must submit a plan no later than
March 5, 2018, setting forth the actions it will take to regain
compliance with the Listing Rules for continued listing. If Nasdaq
accepts such plan, the Company may be granted an exception of up to
180 calendar days from the date the Form 10-K was due, or until
June 27, 2018, to regain compliance. The letter from Nasdaq has no
immediate effect on the listing of the Company's common stock on
the Nasdaq Capital Market.
About Ominto, Inc.
Based in Boca Raton, Florida, Ominto, Inc. --
http://inc.ominto.com/-- is a global e-commerce company 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.
Ominto reported a net loss of $10.30 million for the year ended
Sept. 30, 2016, and a net loss of $11.69 million for the year ended
Sept. 30, 2015. As of June 30, 2017, Ominto had $58.38 million in
total assets, $43.39 million in total liabilities and $14.99
million in total equity.
OMNITRACS LLC: Moody's Assigns B2 CFR & Rates New 1st Lien Loans B2
-------------------------------------------------------------------
Moody's Investors Service affirmed Omnitracs, LLC's B2 Corporate
Family Rating and assigned a B2 rating to its proposed first-lien
term loan and revolver. The new first lien facility represents the
preponderance of the capital structure and is therefore rated the
same as the CFR. The new debt includes a $50 million revolver due
2023 that is expected to be undrawn at closing, and a $745 million
term loan due 2025, whose proceeds will be used primarily to
refinance the company's existing $543 million first lien and $190
million second lien term loan. Upon closing, the ratings on the
existing debt will be withdrawn. The outlook remains stable.
RATINGS RATIONALE
Omnitracs, LLC's ("Omnitracs") B2 Corporate Family Rating is
primarily driven by high leverage from the acquisition financing of
Omnitracs, Roadnet and XRS as well as the cyclical nature of the
business. The rating is supported by the leading position Omnitracs
has built providing fleet management software and communications
systems for the long haul trucking industry (about 80% revenues),
its strong recurring revenue base (typically above 70% of
revenues), high retention rates (typically about 95%) and cash
generating capabilities. Debt to EBITDA is 6.3x (Moody's adjusted)
for LTM December 31, 2017 and is expected to decline modestly in
the next twelve months.
Revenues are tied to trucking industry cycles. The company,
however, demonstrates very high maintenance renewal rates
(typically over 90%) and recurring revenues grew modestly during
FY16 -- a period of end-market weakness. The stable base of
maintenance and subscription revenues supported positive free cash
flow ("FCF") over this LTM period. Additionally, during this period
the company completed several R&D investments and also made changes
to its cost structure such that gross margins grew modestly.
FY17 revenue grew modestly with low single digit growth in
recurring revenue and low teens growth in non-recurring revenue
with organic growth in subscribers. Over the next 12 to 18 months
revenue growth is expected to be driven by the adoption of
electronic driver logs mandated by the US Congress and modest
additions to long haul fleets.
The stable ratings outlook reflects Moody's expectations that
Omnitracs' leverage will fall moderately over the next 12 months
and FCF to debt will be in the low single digits.
Ratings could be upgraded if the company demonstrates sustained
revenue and cash flow growth, with leverage sustained below 5x and
FCF to debt of at least 8%.
The ratings would face downward pressure if revenues and EBITDA
decline in FY 2018, leverage is expected to be sustained above
6.5x, FCF is negative on other than a temporary basis.
Liquidity is good based on $45 million of cash on the balance sheet
at December 31, 2017. Moody's expect FCF of about $50 million over
the next 12 to 18 months, subject to capital markets conditions
remaining favorable. The proposed revolver has a springing
financial covenant if the borrowings exceed 35% of the revolver
size. There is no covenant on the proposed term loan.
Assignments:
Issuer: Omnitracs, LLC
-- Senior Secured 1st Lien Bank Credit Facility, Assigned B2
LGD4)
Affirmations:
Issuer: Omnitracs, LLC
-- Probability of Default Rating, Affirmed B2-PD
-- Corporate Family Rating, Affirmed B2
Outlook Actions:
Issuer: Omnitracs, LLC
-- Outlook, Remains Stable
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Omnitracs is a provider of fleet management software and
communications systems to the trucking industry. The Omnitracs
business was acquired by private equity firm Vista Partners from
QUALCOMM Inc. in November 2013. Revenues were about $409 million
for FY 2017.
ONE HORIZON: Inks Exchange Agreement with C-Rod
-----------------------------------------------
One Horizon Group, Inc., has entered into an exchange agreement to
acquire a one hundred percent interest in C-Rod, Inc., along with
its record label, Velveteen Entertainment and media content
division, Mues Media, for $150,000, 1,000,000 shares of its common
stock plus an additional number of shares of its common stock based
upon the net after tax earnings of C-Rod during the two years
ending after the completion of the acquisition.
The C-Rod Companies will continue business operations as 'Love
Media House,' a wholly owned subsidiary of One Horizon,
post-closing.
C-Rod, Inc., a premier music production company founded in 2002 by
Grammy-nominated, multi-platinum producer and composer Christopher
Rodriguez, regularly works with superstar artists, which have
included many celebrity acts such as Rihanna, Jennifer Lopez, Lady
Gaga, Enrique Iglesias and Pet Shop Boys.
C-Rod's music productions and remixes are consistently at the top
of the Billboard charts. C-Rod has been involved in several #1
Billboard hits with more than 100 songs breaking the Top 40.
By way of example, C-Rod recently remixed "Consideration," by
Rihanna featuring SZA, which currently sits atop the Billboard
Dance Club Chart:
https://www.billboard.com/charts/dance-club-play-songs/2018-02-24.
Velveteen Entertainment has signed multiple up-and-coming music
artists to its roster under '360 deals' and Muse Media has produced
acclaimed top-ten charting Billboard music videos and works with
artists and corporations in the areas of strategic branding,
content development, social media marketing and digital
distribution.
"We are very pleased that we have entered into the Exchange
Agreement with C-Rod and its businesses, which are complementary to
our recent acquisition of a majority interest in 123Wish and our
strategy to acquire and expand innovative technology-driven digital
and social media companies within our platform," said Mark White,
One Horizon Group's founder and CEO. "We are grateful to work with
Chris Rodriguez, Patricia Nieto and their team; C-Rod is a
profitable business and we expect to recognize revenue commencing
with the closing of this acquisition."
"Our business is growing quickly and we are confident that access
to One Horizon's technology will accelerate our expanded social
media offerings, advance our digital streaming footprint and allow
us to further work with artists to develop multiple revenue streams
associated with their brands and media companies incorporating
cutting edge augmented reality and artificial intelligence," said
Christopher Rodriguez, founder and co-chief executive officer of
the C-Rod Companies.
A full-text copy of the Exchange Agreement is available at:
https://is.gd/qQdM6y
About One Horizon Group
Based in Limerick, Ireland, One Horizon Group, Inc. (NASDAQ: OHGI)
-- http://www.onehorizongroup.com/-- is a media and digital
technology acquisition company, which holds a majority interest in
123Wish, a subscription-based, experience marketplace that focuses
on providing users with exclusive opportunities to enjoy
personalized, dream experiences with some of the world's most
renowned social media influencers, and an Asia-based securing
messaging business.
The Company's independent accountants Cherry Bekaert LLP, in Tampa,
Fla., issued a "going concern" opinion in its report on the
Company's consolidated financial statements for the year ended Dec.
31, 2016, stating that the Company has recurring losses and
negative cash flows from operations that raise substantial doubt
about its ability to continue as a going concern.
One Horizon reported a net loss of $5.54 million on $1.61 million
of revenue for the year ended Dec. 31, 2016, compared to a net loss
of $6.30 million on $1.53 million of revenue for the year ended in
2015. As of Sept. 30, 2017, One Horizon had $8.67 million in total
assets, $4.25 million in total liabilities and $4.42 million in
total stockholders' equity.
According to the Company's Form 10-Q for the period ended Sept. 30,
2017, "[T]he Company will pursue its revised operations and
business plan. The Company expects to incur further non cash losses
in 2017 which, when combined with any costs incurred in pursuing
acquisition of new businesses, may generate negative cash flows. As
of Sept. 30, 2017, the Company did not have any available credit
facilities. As a result, it is in the process of seeking new
financing by way of sale of either convertible debt or equities.
While it has been successful in the past in obtaining the necessary
capital to support its investment and operations,
there is no assurance that it will be able to obtain additional
financing under acceptable terms and conditions, or at all. In the
event that the Company is unable to obtain sufficient additional
funding when needed in order to fund operations, it would not be
able to continue as a going concern and may be forced to severely
curtail or cease operations and liquidate the Company."
PACIFIC DRILLING: Wants Plan Filing Deadline Moved to July 10
-------------------------------------------------------------
Pacific Drilling S.A. and its affiliates ask the U.S. Bankruptcy
Court for the Southern District of New York to extend the Debtors'
exclusive periods during which only the Debtors can file a plan of
reorganization and solicit acceptances of the plan through and
including July 10, 2018, and Sept. 10, 2018, respectively.
A hearing on the Debtors' request is set for March 21, 2018, at
2:00 p.m. (prevailing Eastern Time). Objections to the Debtors'
request must be filed by March 14, 2018, at 4:00 p.m. (prevailing
Eastern Time).
The Exclusive Filing Period is set to expire on March 12, 2018, and
the Exclusive Solicitation Period is set to expire on May 11,
2018.
This is the Debtors' first request to extend exclusivity. A lot
has been going on in these cases, mostly out of Court. The Court
has primarily seen first day motions designed to stabilize the
business, a consensual resolution of the U.S. Trustee's concerns
about the Debtors' employee compensation plan, schedules that were
filed on time, work being done on a business plan, and preliminary
plan negotiations with the major creditor constituencies. No one
has complained that the Debtors are bleeding cash or has presented
evidence that the value of the secured creditors' collateral is
diminishing, and in fact, from the Petition Date through Feb. 23,
2018, the Debtors have generated $7.7 million of positive cash flow
when excluding adequate protection payments and the creditors'
professional fees.
As of the close of business on March 1, 2018, the Debtors held
ample cash reserves of approximately $289 million. The Debtors are
stable and no creditors are harmed by the extension of time needed
to get to a plan. Mostly though, after a contentious start to the
Chapter 11 cases, the Debtors have been working hard to jump-start
meaningful restructuring negotiations. To that end, there have
been numerous telephone conversations and face-to-face meetings
between the Debtors and various major creditors and their
professional advisors. An offer from the Debtors of terms on which
they are prepared to consent to the mediation sought by the major
creditors has been made which, if accepted by the parties, will
pause and potentially end the litigation this Court has seen from
the very beginning of this case. Indeed, the Debtors' term sheet
for mediation has been provided to the major creditor groups and if
it is accepted, will result in a consent order that will make the
prosecution of this request uncontested by all the major creditor
constituencies.
Just as the Debtors stated at the outset of these cases, an effort
was made to actively pursue restructuring negotiations in January
on the basis of a revised term sheet from Quantum Pacific
Gibraltar, Ltd., that the Debtors received on Jan. 16, 2018. Since
that time, the Debtors' professionals have had three meetings
(including in-person and telephonic meetings) with the
professionals for each of the Ad Hoc Group, the SSCF Agent, the
SSCF Lenders, the RCF Agent, the RCF Lenders, and the Ad Hoc Group
of RCF Lenders and a number of phone calls between the Debtors'
financial advisors and advisors for creditor groups, and between
and among Togut, Segal & Segal, LLP and the various lead counsel
for the creditor groups.
At the same time, the Debtors have been doing a tremendous amount
of work to ensure that chapter 11 plan negotiations are efficient
and productive. They used the first 120 days of their Chapter 11
cases to accomplish a number of vitally important tasks that will
facilitate plan negotiations with their major creditor
constituencies. The Debtors intend to use the requested 120-day
extension to engage with the Secured Creditor Parties and their
majority shareholder, QP, regarding a consensual Chapter 11 plan.
The Debtors are developing a current business plan that reflects
the best input available for the present market outlook for the
Debtors' industry and their business.
Several times and with different creditor constituencies, the
importance of an up-to-date business plan that takes into account
significant recent changes in oil prices and expectations for their
evolution has been emphasized as the lynchpin for more substantive
discussions. Now that the Debtors are operating in a Chapter 11
context, negotiations require that the current outlook for the
Debtors' industry and their specific business be carefully
formalized in a business plan that is informed by, and has been
vetted with, recognized industry specialists with expertise in
developing outlooks for the Debtors' commodity-driven industry, and
by bankruptcy specialists who are respected by the creditors. Once
the business plan, which is currently being formulated, is
completed, it will be shared with the professionals for the
creditor groups who will be given the opportunity to diligence the
plan with management and the Debtors' advisors. This process is
designed to give creditors comfort that the business plan has been
informed by independent expert input and is therefore a reliable
basis on which to build consensus for a plan of reorganization. It
is also designed to avoid lengthy and costly litigation, and
failing that, to provide the Court with the quality of evidence it
would expect in a litigated plan confirmation process.
The Debtors are taking the necessary and typical steps to progress
their Chapter 11 cases and ensure that they can formulate and
propose a feasible, confirmable plan that maximizes value for all
parties in interest. In addition to the early-stage plan
negotiations, the Debtors have accomplished, among others, the
following critical tasks:
-- stabilizing their businesses by obtaining relief in the
form of various "first day" and "second day" motions,
implementing revised cash management systems, hiring and
retaining estate professionals, complying with the various
reporting requirements instituted by Chapter 11, and
preventing key employees from leaving the company in favor
of competitors while the company is operating in a
drilling market that is showing signs of improvement;
-- positioning operations for future success by negotiating
contracts to keep certain of their rigs working and
producing revenue, and to arrange rig visits for potential
customers at their smart-stacked rigs;
-- working cooperatively with the U.S. Trustee to provide
documents, information, and access to the Debtors' senior
management, key employees, and professionals in response
to the U.S. Trustee's requests for information related to
the Debtors' Compensation Programs, which allowed the
Debtors to reach a consensual resolution regarding the
vast majority of the Compensation Programs and ultimately
pay incentive-based bonuses to many of the Debtors'
critical rank-and-file employees, which has helped the
company stabilize and maintain its high-quality workforce;
-- working with three retained experts, who as of the date of
this request have provided the Debtors with initial input,
and preparing formal reports which the Debtors will use to
help inform the Debtors' judgment with respect to their
business plan forecast, debt capacity analysis,
feasibility analysis, valuation, and liquidation analysis
that the Debtors will utilize for plan of reorganization
purposes;
-- putting the Secured Creditor Parties on a level
informational playing field by voluntarily (i) completing
production of over 12,000 pages of documents in response
to the Secured Creditor Parties' Bankruptcy Rule 2004
discovery requests; (ii) providing the Secured Creditor
Parties and others with access to a virtual data room that
includes tens of thousands of additional pages of
financial, operational, and legal information in response
to due diligence requests; (iii) preparing a weekly
liquidity analysis; (iv) seeking to schedule a management
meeting with the creditors' advisors to update them on the
2018 budget, the Zonda Arbitration, and business
operations; and (v) offering to make available three
members of the Board of Directors' Restructuring Committee
and two members of senior management to respond to the
Secured Creditor Parties' questions concerning corporate
governance and Board independence;
-- concluding the four-week evidentiary portion of the Zonda
Arbitration hearing in London which, if successful, will
result in the recovery of potentially up to $350 million
of unrestricted cash into the estates and the elimination
of a potential prepetition unsecured claim against the
Debtors of approximately $336 million, plus interest and
costs;
-- responding to motions for an order appointing a mediator
filed by the Ad Hoc Group, SSCF Agent, and RCF Agent; and
-- preparing a response to a request made to the U.S. Trustee
by a shareholder for the formation of an equity committee.
The Debtors will make use of forthcoming expert reports to complete
an up-to-date business plan that will serve as one of the key
inputs for plan discussions, and they expect to have a version of
that business plan to share with the Secured Creditor Parties in
April. While this important work is progressing, the Debtors are
meeting with their creditors. That will continue. The Debtors
expect March and April to be critical to progressing plan
negotiations, and the Debtors will continue to meet with the
various Secured Creditor Parties and QP. Simultaneously, under the
leadership of management and the Debtors' advisors, the Debtors
have made tremendous strides in stabilizing their operations and
will continue to do so.
The Debtors' goal is a consensual -- not a litigious -- negotiation
concerning their restructuring. For that to happen in an orderly
way, they seek the requested extension to allow time for those
negotiations to result in what is hopefully a consensual Chapter 11
plan. As the Debtors stated at the Feb. 20, 2018, hearing to
consider the secured lenders' mediation motions, they are committed
to reaching a deal. The requested extension is required to get
there.
A copy of the Debtors' request is available at:
http://bankrupt.com/misc/nysb17-13193-247.pdf
About Pacific Drilling
Pacific Drilling S.A., a Luxembourg public limited liability
company (societe anonyme), operates an international offshore
drilling business that specializes in ultra-deepwater and complex
well construction services. Pacific Drilling --
http://www.pacificdrilling.com/-- owns seven high-specification
floating rigs: the Pacific Bora, the Pacific Mistral, the Pacific
Scirocco, the Pacific Santa Ana, the Pacific Khamsin, the Pacific
Sharav and the Pacific Meltem. All drillships are of the latest
generations, delivered between 2010 and 2014, with a combined
historical acquisition cost exceeding $5.0 billion. The average
useful life of a drillship exceeds 25 years.
On Nov. 12, 2017, Pacific Drilling S.A. and 21 affiliates each
filed a voluntary petition for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
17-13193). The cases are pending before the Honorable Michael E.
Wiles and are jointly administered.
Pacific Drilling disclosed $5.46 billion in assets and $3.18
billion in liabilities as of Sept. 30, 2017.
The Debtors tapped Sullivan & Cromwell LLP as bankruptcy counsel
but was later replaced by Togut, Segal & Segal LLP. Evercore
Partners International LLP as investment banker; AlixPartners, LLP,
as restructuring advisors; and Prime Clerk LLC as claims and
noticing agent.
The RCF Agent tapped Shearman & Sterling LLP, as counsel, and PJT
Partners LP, as financial advisor.
The ad hoc group of RCF Lenders engaged White & Case LLP, as
counsel.
The SSCF Agent tapped Milbank Tweed, Hadley & McCloy LLP, as
counsel, and Moelis & Company LLC, as financial advisor.
The Ad Hoc Group of Various Holders of the Ship Group C Debt, 2020
Notes and Term Loan B tapped Paul, Weiss, Rifkind, Wharton &
Garrison, in New York as counsel.
PACIFIC DRILLING: Wants Plan Filing Deadline Moved to July 10
-------------------------------------------------------------
BankruptcyData.com reported that Pacific Drilling filed with the
U.S. Bankruptcy Court a motion to extend exclusivity period during
which the Company can file a Chapter 11 Plan and Disclosure
Statement and solicit acceptances thereof, through and including
July 10, 2018 and September 10, 2018. The extension motion
explains, "This is the Debtors' first request to extend
exclusivity. The Debtors intend to use the requested 120-day
extension to engage with the Secured Creditor Parties and their
majority shareholder, QP, regarding a consensual chapter 11 plan.
The Debtors are developing a current business plan that reflects
the best input available for the present market outlook for the
Debtors' industry and their business. Several times and with
different creditor constituencies, the importance of an up-to-date
business plan that takes into account significant recent changes in
oil prices and expectations for their evolution has been emphasized
as the lynchpin for more substantive discussions. Now that the
Debtors are operating in a chapter 11 context, negotiations require
that the current outlook for the Debtors' industry and their
specific business be carefully formalized in a business plan that
is informed by, and has been vetted with, recognized industry
specialists with expertise in developing outlooks for the Debtors'
commodity-driven industry, and by bankruptcy specialists who are
respected by the creditors….The Debtors' goal is a consensual --
not a litigious -- negotiation concerning their restructuring. For
that to happen in an orderly way, they seek the requested extension
to allow time for those negotiations to result in what is hopefully
a consensual chapter 11 plan. As the Debtors stated at the February
20, 2018 hearing to consider the secured lenders' mediation
motions, they are committed to reaching a deal. The requested
extension is required to get there."
The Court scheduled a March 21, 2018 hearing to consider the
extension motion with objections due by March 14, 2018, according
to the report.
About Pacific Drilling
Pacific Drilling S.A., a Luxembourg public limited liability
company (societe anonyme), operates an international offshore
drilling business that specializes in ultra-deepwater and complex
well construction services. Pacific Drilling --
http://www.pacificdrilling.com/-- owns seven high-specification
floating rigs: the Pacific Bora, the Pacific Mistral, the Pacific
Scirocco, the Pacific Santa Ana, the Pacific Khamsin, the Pacific
Sharav and the Pacific Meltem. All drillships are of the latest
generations, delivered between 2010 and 2014, with a combined
historical acquisition cost exceeding $5.0 billion. The average
useful life of a drillship exceeds 25 years.
On Nov. 12, 2017, Pacific Drilling S.A. and 21 affiliates each
filed a voluntary petition for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
17-13193). The cases are pending before the Honorable Michael E.
Wiles and are jointly administered.
Pacific Drilling disclosed $5.46 billion in assets and $3.18
billion in liabilities as of Sept. 30, 2017.
The Debtors tapped Sullivan & Cromwell LLP as bankruptcy counsel
but was later replaced by Togut, Segal & Segal LLP. Evercore
Partners International LLP as investment banker; AlixPartners, LLP,
as restructuring advisors; and Prime Clerk LLC as claims and
noticing agent.
The RCF Agent tapped Shearman & Sterling LLP, as counsel, and PJT
Partners LP, as financial advisor.
The ad hoc group of RCF Lenders engaged White & Case LLP, as
counsel.
The SSCF Agent tapped Milbank Tweed, Hadley & McCloy LLP, as
counsel, and Moelis & Company LLC, as financial advisor.
The Ad Hoc Group of Various Holders of the Ship Group C Debt, 2020
Notes and Term Loan B tapped Paul, Weiss, Rifkind, Wharton &
Garrison, in New York as counsel.
PARAGON GLOBAL: Needs More Time to Analyze New Sources of Revenue
-----------------------------------------------------------------
Paragon Global, LLC, and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of Texas to extend the
exclusive right to file a Chapter 11 plan of reorganization for the
Debtors from April 4, 2018, to and including July 2, 2018.
A hearing on the Debtors' request is set for March 29, 2018, at
9:00 a.m.
One of the issues that necessitated the debtors to have to file for
protection under the U.S. Bankruptcy is irregularities in the
initial purchase of the companies from the previous owners. Those
issues are being investigated and proposed special litigation
counsel is being interviewed. A decision regarding the course of
action to take regarding these issues should be made in the next
couple of months.
NewTek is conducting a Rule 2004 examination of Mr. Patel on March
23, 2018, and the debtors are discussing with general bankruptcy
counsel and proposed special litigation counsel, the necessity of
filing objections to claims, as well as conducting discovery and
taking depositions of various creditors and parties in interest.
In addition, the production of documents to NewTek for the Rule
2004 examination is taking a substantial amount of time, which is
preventing Mr. Patel and the businesses from being able to
formulate a plan in time to meet the April 4, 2018, deadline.
Another major issue that has caused a setback for the Debtors is
the unanticipated additional recovery time necessary because of
Hurricane Harvey. It has been six months since the hurricane, but
the recovery process has been slow.
The Debtors have discovered that a simple plan of trimming costs
and reducing expenses have far larger ramifications that may impact
their revenue opportunities going forward. Because of this, they
need additional time to analyze these ramifications so that they
can build a reasonable plan.
Seeking new sources of revenue is very important to the plan, but
the Debtors need more time to analyze these opportunities. Many
potential new clients have various requirements that impact the
margin required to attain profitability. The Debtors need to
completely understand all of these clients' requirements before
they can present a plan with a reasonable forecast.
This is the year that the "R" stamp will be renewed. This process
is timely in preparation and there are now additional costs that
the National Board require to complete the renewal. The renewal of
the "R" Stamp is imperative to the Debtors' business to weld on
pressure parts. Without it, the debtors are out of business. This
is a timing issue but with limited resources it takes time away
from finalizing the restructuring plan. The National Board offers
the Certificate of Authorization and "R" symbol stamp for the
repair and/or alteration of boilers, pressure vessels, and other
pressure-retaining items. Organizations seeking a National Board
"R" Certificate of Authorization must complete and (1) have and
maintain an inspection agreement with an authorized inspection
agency, (2) have a written quality system that complies with the
requirements of the current edition of the National Board
Inspection Code (NBIC) and includes the expected scope of
activities, (3) have the current edition of all parts of the NBIC.
Organizations have the option of using either a printed version or
an electronic version, including a subscription from a National
Board licensed reseller, to fulfill this requirement; and, (4) have
available a copy of the code of construction appropriate for the
intended scope of work. Prior to issuance of a National Board "R"
Certificate of Authorization, the organization and its facilities
are subject to an onsite review of its quality system.
The Debtors are evaluating whether or not they need to raise
additional working capital as part of the reorganization, and this
will take time to prepare a package for a potential source of
capital.
About Paragon Global
Paragon Fabricators, Inc. -- http://www.paragontexas.com/-- is a
ASME pressure vessel fabrication shop located in La Marque, Texas,
serving the needs of the Petro-chemical & Oil & Gas industries in
the Gulf Coast markets for over four decades. Founded in 1975,
Paragon Fabricators has recently been acquired by new ownership led
by Chairman and CEO Surendra Patel who has over 30 years of
experience in contract manufacturing, engineering services and
electrical distribution.
Paragon Global, LLC, and its affiliates, Paragon Fabricators,
Incorporated; Paragon Field Services, Inc.; Patel Property
Holdings, LLC, filed Chapter 11 petitions (Bankr. S.D. Tex. Lead
Case No. 17-36605) on Dec. 5, 2017.
In the petitions signed by Surendra Patel, managing member, the
Paragon Global disclosed $4.88 million in assets and $4.18 million
in liabilities; and Patel Property Holdings disclosed $5.35 million
in assets and $1.67 million in liabilities.
The Hon. Marvin Isgur presides over the Debtors' cases.
Margaret M. McClure, Esq., at the Law Office of Margaret M.
McClure, serves as bankruptcy counsel to the Debtors.
PATRIOT NATIONAL: Court Enters Final OK on $15.5-Mil. Financing
---------------------------------------------------------------
BankruptcyData.com reported that the U.S. Bankruptcy Court issued a
final order approving Patriot Nationals' motion for entry of an
order authorizing the Debtors to obtain post-petition financing,
authorizing the use of cash collateral, granting liens and
super-priority claims, granting adequate protection to pre-petition
secured lenders and modifying the automatic stay. As previously
reported, "In consultation with their legal and financial advisors,
PNI, as borrower, the remaining Debtors, as guarantors, and
Cerberus Business Finance, LLC (the 'DIP Agent'), as administrative
and collateral agent for certain lenders (the 'DIP Lenders,' and,
together with the Borrower and the Guarantors, the 'DIP Parties'),
have negotiated the DIP Facility. The Guarantors will provide
guarantees of the obligations incurred by PNI under the DIP
Facility. The DIP Agreement provides for a postpetition loan
commitment in an aggregate principal amount not to exceed $15.5
million; provided that, until the Court enters the Final Order, no
loans under the DIP Agreement shall be made other than loans in an
aggregate principal amount not to exceed $5 million. Upon entry of
the Final Order, PNI intends to borrow the amount necessary to
repay the $4.955 million in Prepetition Collateral Agent Advances
plus all fees, expenses and accrued and unpaid interest (including
default interest) thereon."
About Patriot National
Fort Lauderdale, Florida-based Patriot National, Inc., also known
as Old Guard Risk Services, Inc., through its subsidiaries,
provides agency, underwriting and policyholder services to its
insurance carrier clients, primarily in the workers' compensation
sector. Patriot National -- http://www.patnat.com/-- provides
general agency services, technology outsourcing, software
solutions, specialty underwriting and policyholder services, claims
administration services and self-funded health plans to its
insurance carrier clients, employers and other clients. Patriot
was incorporated in Delaware in November 2013.
The Company completed its initial public offering in January 2015
and its common stock is listed on the New York Stock Exchange under
the symbol "PN."
Patriot National, Inc., and affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 18-10189) on Jan. 30, 2018. In the
petitions signed by CRO James S. Feltman, the Debtors disclosed
$159.4 million in total assets and $242.2 million in total debt as
of Dec. 31, 2017.
The Debtors have tapped Laura Davis Jones, Esq., James E. O'Neill,
Esq., and Peter J. Keane, Esq., at Pachulski Stang Ziehl & Jones
LLP and Kathryn A. Coleman, Esq., Christopher Gartman, Esq., and
Jacob Gartman, Esq., at Hughes Hubbard & Reed LLP as bankruptcy
Counsel; Pachulski Stang Ziehl & Jones LLP as co-counsel and
conflicts counsel; Duff & Phelps, LLC, as financial advisor; and
Conway Mackenzie Management Services, LLC, as provider of EVP of
Finance and related advisory services. Prime Clerk LLC --
https://cases.primeclerk.com/patnat -- is the Debtors' claims,
noticing and balloting agent.
James S. Feltman of Duff & Phelps, LLC, has been tapped as chief
restructuring officer to the Debtors.
The Office of the U.S. Trustee has named two creditors -- Jessica
Barad and MCMC LLC -- to serve on an official committee of
unsecured creditors in the Debtors' cases.
PETROLIA ENERGY: Completes Acquisition of Bow Energy
----------------------------------------------------
Petrolia Energy Corporation has completed the acquisition of Bow
Energy Ltd., a Canadian based oil and natural gas company, pursuant
to which Petrolia has acquired all of the issued and outstanding
common shares in the capital of Bow. The Plan of Arrangement was
approved by an overwhelming majority of more than 99% of the votes
cast by the Bow's shareholders at the special meeting of
shareholders held on Feb. 21, 2018. Final approval of the Plan of
Arrangement was granted by the Court of Queen's Bench of Alberta on
Feb. 23, 2018, and the acquisition closed on Feb. 27, 2018.
Under the terms of the Arrangement, Bow shareholders are deemed to
have received 1.15 Petrolia common stock shares for each Bow Share.
It is expected that the Bow Shares will be delisted from the
facilities of the TSX Venture Exchange after the close of business
on March 2, 2018. Bow's common shares are currently listed and
posted for trading on the TSX Venture Exchange.
The acquired assets of Bow consist of over 948,000 net acres
onshore North Sumatra, Indonesia which consists of interests in
five production-sharing contracts (PSCs) and one Joint Study
Agreement (JSA) with the Indonesian government. The assets are
surrounded by major discoveries by Repsol, ConocoPhillips and
Chevron and existing transportation infrastructure.
To date, a preliminary Unrisked Prospective Resources estimate has
been conducted on only one of the six newly acquired assets (South
Block A), which represents 43,273 acres (only ~5% of the Net
Acreage of the newly acquired Indonesian properties). The
preliminary engineering resource estimate was conducted by McDaniel
& Associates Consultants LT and states that there are 91.8 Millions
of Barrels of Oil Equivalent, the final version of the report is
expected to be completed in Q1 2018. Unrisked Prospective
Resources are estimated potentially recoverable volumes associated
with a development plan that targets as yet undiscovered volumes
and are not SEC Reserves.
Upon completion of the acquisition, James E. Burns, the president
of Petrolia commented, "While we remain focused on developing our
onshore domestic portfolio here in the United States, the
Indonesian assets are truly special. Being able to find an acreage
package of this size and quality was just too good to pass up. We
are looking forward to continuing our discussions with local
financial and operating partners in the region to strategize on how
best to commercialize these assets over the long-term."
About Petrolia Energy
Headquartered in Houston, Texas, Petrolia Energy Corporation,
formerly known as Rockdale Resources Corporation, is an oil and gas
exploration, development, and production company with operations in
the United States and Indonesia. With operations in Texas,
Oklahoma and New Mexico, the Company focuses on redeveloping
existing oil fields in well-established oil rich regions of the
U.S., employing industry-leading technologies to create added
value. The Company focuses on redeveloping existing oil fields in
well-established oil rich regions in the US such as the Permian,
employing industry-leading technologies to create added value.
Petrolia Energy reported a net loss of $1.87 million on $321,000 of
total revenue for the year ended Dec. 31, 2016, compared with a net
loss of $1.85 million on $188,000 of total revenue for the year
ended Dec. 31, 2015. As of Sept. 30, 2017, Petrolia Energy had
$13.49 million in total assets, $1.89 million in total liabilities
and $11.59 million in total stockholders’ equity.
MaloneBailey, LLP, issued a "going concern" qualification on the
consolidated financial statements for the year ended Dec. 31, 2016,
citing that Petrolia Energy has incurred losses from operation
since inception and has a net working capital deficiency. These
factors raise substantial doubt about the Company's ability to
continue as a going concern.
PETROQUEST ENERGY: Lowers Fourth Quarter Net Loss to $389,000
-------------------------------------------------------------
PetroQuest Energy, Inc. reported a loss for the quarter ended Dec.
31, 2017 of $389,000, or $0.02 per share, compared to fourth
quarter 2016 net loss to common stockholders of $9,659,000, or
$0.46 per share. For the year ended Dec. 31, 2017, the Company
reported a net loss to common stockholders of $11,776,000, or $0.55
per share, compared to net loss to common shareholders of
$96,245,000, or $5.24 per share, for the year ended Dec. 31, 2016.
The year ended Dec. 31, 2016 included a ceiling test write-down of
$40,304,000.
Net cash flow provided by (used in) operating activities for the
fourth quarter of 2017 was $8,825,000 as compared to $(4,861,000)
for the comparable 2016 period. Discretionary cash flow for the
fourth quarter of 2017 was $16,880,000 as compared to $3,591,000
for the comparable 2016 period. Net cash flow provided by (used
in) operating activities for the year ended of 2017 was $44,153,000
as compared to $(56,598,000) for the comparable 2016 period. For
the year ended Dec. 31, 2017, discretionary cash flow was
$51,212,000 compared to $597,000 for 2016.
Oil and gas sales during the fourth quarter of 2017 were
$35,080,000 as compared to $16,429,000 in the fourth quarter of
2016. For the year ended Dec. 31, 2017, oil and gas sales
increased 62% to $108,287,000 as compared to $66,667,000 for the
year ended Dec. 31, 2016. Production for the year ended Dec. 31,
2017 was 17% higher than 2016. Stated on an Mcfe basis, unit
prices received during the fourth quarter and the year ended Dec.
31, 2017 were 16% and 38% higher, respectively, as compared to the
prices received during the comparable 2016 periods.
Lease operating expenses during 2017 totaled $33,162,000 as
compared to $28,508,000 in 2016. Lease operating expenses for the
fourth quarter of 2017 were $1.18 per Mcfe as compared to $1.43 per
Mcfe in the fourth quarter of 2016. Lease operating expenses for
the year ended Dec. 31, 2017 were $1.20 per Mcfe as compared to
$1.21 for the year ended Dec. 31, 2016.
Depreciation, depletion and amortization on oil and gas properties
for the fourth quarter of 2017 was $1.19 per Mcfe as compared to
$1.11 per Mcfe in the fourth quarter of 2016. For the year ended
Dec. 31, 2017, DD&A on oil and gas properties decreased to $1.15
per Mcfe from $1.19 per Mcfe for 2016.
Interest expense for the fourth quarter of 2017 was $7,060,000, as
compared to $7,522,000 in the fourth quarter of 2016. For the year
ended Dec. 31, 2017, interest expense was $28,836,000 compared to
$30,019,000 for 2016.
Fourth quarter of 2017 general and administrative expense was
$309,000 higher than the comparable 2016 period. For the year
ended Dec. 31, 2017, general and administrative expense was
$10,180,000 lower than 2016. The decrease in general and
administrative expense during the 2017 annual period was primarily
the result of the inclusion of costs associated with the Company's
two debt exchanges in 2016.
Production taxes for the fourth quarter of 2017 totaled $1,312,000,
as compared to $(255,000) in the fourth quarter of 2016. For the
year ended Dec. 31, 2017, production taxes were $3,302,000, as
compared to $354,000 for 2016. Production taxes during 2016
included $1,292,000 of production tax refunds on certain of our
East Texas wells that qualified for a gas tax credit. In addition,
the two-year severance tax exemption on the Company's Thunder Bayou
well expired in June 2017.
The Company is continuing to evaluate various joint venture
structures in connection with planning its 2018 Cotton Valley
drilling program. As a result, the Company expects to provide its
2018 capital expenditures guidance in conjunction with its first
quarter 2018 earnings press release.
"Our fourth quarter 2017 results represent the culmination of a
tremendous year as we accomplished numerous corporate goals
including nearly doubling our fourth quarter 2016 production rate
and growing our proved reserves and PV-10 by 35% and 89%,
respectively," said Charles T. Goodson, chairman, chief executive
officer and president. "In addition, we established a 25,000 gross
acre position in an area that we believe will ultimately be
determined to be in the core of the Louisiana Austin Chalk oil
trend. Our current plans call for us to spud our initial
horizontal Austin Chalk well during the second quarter of 2018 and
we are continuing to evaluate various joint venture structures in
connection with our 2018 Cotton Valley development plan."
A full-text copy of the press release is available for free at:
https://is.gd/APgUxN
About Petroquest
Lafayette, La.-based PetroQuest Energy, Inc. --
http://www.petroquest.com/-- is an independent energy company
engaged in the exploration, development, acquisition and production
of oil and natural gas reserves in Texas and Louisiana.
PetroQuest's common stock trades on the New York Stock Exchange
under the ticker PQ.
PetroQuest reported a net loss available to common stockholders of
$96.24 million in 2016 and a net loss available to common
stockholders of $299.9 million in 2015. The Company's balance
sheet at Sept. 30, 2017, showed $159.5 million in total assets,
$415.7 million in total liabilities and a total stockholders'
deficit of $256.20 million.
* * *
In June 2017, Moody's Investors Service withdrew all assigned
ratings for PetroQuest Energy, including the 'Caa3' Corporate
Family Rating, following the elimination of all of its rated debt.
In December 2017, S&P Global Ratings raised its corporate credit
rating on PetroQuest Energy to 'CCC+' from 'CCC'. The rating
outlook is negative. "The upgrade reflects our assessment that
PetroQuest is likely to generate sufficient cash flow and, along
with continued access to its multidraw term loan, have sufficient
liquidity to meet cash interest requirements through 2018. The
company has the option to make PIK interest payments on its
second-lien senior secured PIK notes through August 2018 at 1% cash
interest and 9% PIK.
PMHC II: S&P Assigns 'B-' Corp. Credit Rating, Outlook Positive
---------------------------------------------------------------
S&P Global Ratings assigned its 'B-' corporate credit rating to
Houston-based PMHC II Inc. The outlook is positive.
S&P said, "At the same time, we assigned our 'B-' issue-level
rating to the company's $590 million first-lien credit facilities
and our 'CCC+' issue-level rating to the company's $160 million
second-lien term loan. The recovery ratings on the first-lien
credit facilities are '3', indicating our expectation of meaningful
(50%-70%; rounded estimate: 60%) recovery in the event of a
conventional payment default. The recovery rating on the
second-lien term loan is '5', indicating our expectation of modest
(10%-30%; rounded estimate: 10%) recovery in the event of a
conventional payment default."
Initially, ASP Prince Merger Sub Inc. will be a co-borrower on the
new first- and second-lien credit facilities (along with PMHC II
Inc.) until the transaction closes. Upon consummation of the
transaction, PMHC II Inc. will remain as borrower on the debt.
S&P said, "In addition, once the transaction closes and Prince
International Corp.'s outstanding $285 million 11.5% senior secured
notes due 2019 are redeemed in full, we will withdraw our corporate
credit rating on Prince and our issue-level and recovery ratings on
the notes.
"Our 'B-' corporate credit rating reflects PMHC II's position as a
niche player in a highly fragmented and competitive industry with
low barriers to entry. We expect PMHC II's profitability to benefit
from a shift toward higher value-added specialty chemical products
as the company consolidates its Prince and Erachem businesses. As a
result of the transaction, PMHC II's balance sheet debt will
increase, and we forecast credit measures to remain weaker than
those of other rated specialty chemical peers such Drew Marine
Group Cooperatie U.A., which has weighted-average adjusted debt to
EBITDA in the 5x-5.5x range. In our base-case forecast, we expect
weighted-average adjusted debt to EBITDA of roughly 6x and
weighted-average funds from operations (FFO) to debt of about 10%.
We expect that PMHC II will improve its EBITDA margins and maintain
them in the 18% to 20% range as the company continues to recognize
the benefits of prior acquisitions and previous cost-cutting
initiatives.
"The positive outlook reflects our expectation that PMHC II's
increased exposure to higher-margin specialty chemicals products,
coupled with robust steel and construction markets and a recovering
oil and gas market, should allow the company to reduce adjusted
leverage to below 6.5x in 2018 with further improvement to below 6x
by early 2019. At the same time, we expect adjusted FFO to debt to
improve to nearly 10%, while maintaining EBITDA interest coverage
of approximately 2.5x, over the next 12 months.
"We could raise our ratings over the next 12 months if PMHC II
continues to execute its strategy to diversify its business and
shift its product mix toward higher-margin specialty chemicals
products, while growing EBITDA in its value-added distribution and
proprietary blends channels. We believe this would be supported by
favorable demand in its key end markets (particularly,
construction, agriculture, steel, electronics, and oil and gas).
Specifically, we could raise the ratings if end-market demand led
to stronger volumes than we are projecting, and allowed the company
to sustain adjusted debt to EBITDA below 6x and FFO to debt above
10%. Additionally, successful integration and the establishment of
a track record as a fully consolidated entity would likely
precipitate an upgrade.
"We could revise our outlook to stable if end-market demand waned,
or the company is unable to execute on its growth initiatives or
adequately pass along its raw material costs such that adjusted
leverage trends toward 8x or FFO to debt falls to about 6% on a
sustained basis. Although less likely, we could lower the ratings
if the company's liquidity deteriorated such that we viewed a
covenant breach under its revolving credit facility to be likely
over the next 12 months. This could occur if borrowings under its
$85 million revolving credit facility increased above $35 million,
coupled with weaker than expected EBITDA, leading to very tight
covenant cushion. We could also lower the ratings if the company
pursues any large debt-funded shareholder rewards or acquisitions."
POINTE SDMU: Case Summary & 9 Unsecured Creditors
-------------------------------------------------
Debtor: Pointe SDMU, LP
3130 Bonita Road
Chula Vista, CA 91910
Type of Business: Pointe SDMU, LP, is a privately held company
whose principal assets are located at SE Corner
of Sweetwater & Jamacha, County of San Diego,
California.
Chapter 11 Petition Date: March 8, 2018
Case No.: 18-01343
Court: United States Bankruptcy Court
Southern District of California (San Diego)
Judge: Hon. Christopher B. Latham
Debtor's Counsel: Dayna C. Chillas, Esq.
THE CHILLAS LAW FIRM
3645 Ruffin Road, Suite 210
San Diego, CA 92123
Tel: 858-652-0250
E-mail: dayna.c@hotmail.com
Estimated Assets: Unknown
Estimated Liabilities: $50 million to $100 million
The petition was signed by Robert A. Gosness, CEO of General
Partner.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/casb18-01343.pdf
List of Debtor's Nine Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
ADP Chandler Payroll Service $2,700
ADR Services Prof. Services $12,000
Franchise Tax Board Taxes $10,600
George E. Hurley, Jr. Prof. Services $85,000
Groundwork, Inc./REC Trade Debt $27,787
Harriet Hochman Unsecured Loan $400,000
9150 Wilshire Blvd., Ste 300
Los Angeles, CA 90212
Tel: (310) 281-3200
Carl M. Hancock Prof. Services $6,000
Morrison Engineering Trade Debt $60,143
Quinn Emmanuel Prof. Services $350,000
865 S. Figueroa St.
Los Angeles, CA 90017
Tel: (213) 443-3000
PREFERRED CARE: May Obtain Financing, Use Cash on Final Basis
-------------------------------------------------------------
Judge Mark X. Mullin of the U.S. Bankruptcy Court for the Northern
District of Texas authorized Preferred Care Inc. and its debtor
affiliates (a) to obtain debtor-in-possession secured financing
from Wells Fargo Bank, National Association (in its capacity as
Administrative Agent under the DIP Facility) and (b) to use the
pre-petition collateral, and the proceeds and products thereof
pursuant to the terms and conditions of the DIP Financing Documents
and the Final Order.
The Debtors will use the Loans obtained under the DIP Facility and
the DIP Collateral only for the purposes set forth in the Approved
Budget. The Debtors will at all times remain in compliance with the
Approved Budget for any rolling four-week period, tested weekly.
Notwithstanding, the foregoing:
(a) Total Inflows will not be less than 90% of the amount set
forth in the Approved Budget for any rolling four-week period,
tested weekly;
(b) Cumulative Net Cash Inflow/(Outflow) will not be less than
$5,000,000 of the amount set forth in the Approved Budget, tested
weekly; and
(c) Total Disbursements will not exceed 110% of the amount set
forth in the Approved Budget for any rolling four-week period,
tested weekly.
The Debtors will provide to DIP Agent and Committee not less
frequently than weekly reports of their variance to the Approved
Budget. The Approved Budget may be further modified, amended,
and/or extended from time to time but only with the written consent
of the DIP Agent, and any such modified, amended, and/or extended
Approved Budget will be filed with the Court. The DIP Agent and DIP
Lender will have no obligation to make DIP Facility Advances in
excess of the amounts and times set forth in the Approved Budget.
The DIP Facility Advances will be allowed senior administrative
expenses of the Debtors' estates and have priority in payment over
any other indebtedness and/or obligations now in existence or
incurred hereafter by the Debtors and over all administrative
expenses or charges against property arising in the Chapter 11
Cases and any superseding Chapter 7 cases.
Moreover, the Debtors are authorized to and are deemed to grant to
the DIP Agent, for its benefit, the benefit of the DIP Lender, and
the benefit of any Bank Product Provider, valid, binding, and
enforceable liens, mortgages and/or security interests in all of
the Debtors' and the Debtors' estates presently owned or hereafter
acquired property and assets.
The Parties agreeing to future modifications, absent Court order,
of the following:
A. The defined term "Maximum Revolver Amount" contained in
Schedule 1.1 of the Credit Agreement is amended and restated as
follows: Maximum Revolver Amount means $50,000,000.
B. The defined term "Applicable Margin" contained in Schedule
1.1 of the Credit Agreement is amended and restated as follows:
Applicable Margin means:
(i) until the occurrence of the earlier of a Termination
Event or the DIP Maturity Date, as of any date of determination and
with respect to Base Rate Loans or LIBOR Rate Loans, 3.75
percentage points; and
(ii) on and after the occurrence of the earlier of a
Termination Event or the DIP Maturity Date, as of any date of
determination and with respect to Base Rate Loans or LIBOR Rate
Loans, as applicable, the applicable margin set forth in the
following table that corresponds to the Average Revolver Usage of
Borrowers for the most recently completed month. However, any time
an Event of Default has occurred and is continuing, the Applicable
Margin will be set at the margin in the row styled "Level III."
As of the Petition Date, the Debtors were parties to the Credit
Agreement and the other applicable Loan Documents, pursuant to
which Loan Documents (a) each of the Debtors was, jointly and
severally, indebted to the Pre-Petition Agent and Pre-Petition
Lender, in the approximate non-contingent liquidated amount of no
less than $39,041,871 as of November 13, 2017, and (b) such
Pre-Petition Obligations are secured by valid, enforceable,
properly perfected, first priority, and unavoidable liens on and
security interests encumbering those assets of the Debtors set
forth in the Guaranty and Security Agreements.
Until the indefeasible payment in full and in cash of the
Pre-Petition Obligations, the Pre-Petition Agent, the Pre-Petition
Lender, and the Bank Product Provider are granted, solely to the
extent of diminution in value of the Pre-Petition Liens in the
Pre-Petition Collateral from and after the Petition Date, the
following:
A. valid, binding, first priority, enforceable and fully
perfected Liens in all DIP Collateral junior only to the DIP Liens,
any liens to which the DIP Liens are junior, and the Carve-Out;
and
B. a postpetition superpriority administrative expense claim
against each of the Debtors, with recourse to all prepetition and
postpetition property of the Debtors and all proceeds thereof,
against the Debtors' estates on a joint and several basis, in each
case to the extent the Adequate Protection Liens do not adequately
protect against the diminution in value of the Pre-Petition Liens,
which will have priority in payment over any other indebtedness
and/or obligations now in existence or incurred hereafter by the
Debtors or any of their respective estates and over all other
administrative expenses of any kind.
A full-text copy of the Final Order is available at
http://bankrupt.com/misc/txnb17-44642-414.pdf
About Preferred Care Inc.
Preferred Care Inc. and 33 nursing homes affiliated with the
Preferred Care Group filed voluntary petitions for relief under
Chapter 11 of the United States Bankruptcy Code (Bankr. N.D. Tex.
Lead Case No. 17-44642) on Nov. 13, 2017. The bankruptcy cases are
jointly administered and pending before the Honorable Mark X.
Mullin.
Preferred Care Group is owned by Thomas Scott. He also owns
another company, Preferred Care Inc, which is the master lessee of
some of the facilities. At the time of the filing, Preferred Care
estimated assets and liabilities of $1,000,001 to $10 million.
The Debtors sought bankruptcy protection amid multi-million dollar
personal injury lawsuits in Kentucky and New Mexico.
Preferred Care Partners Management Group LP and Kentucky Partners
Management LLC, unaffiliated companies that manage non-clinical
operations at Preferred Care facilities, also filed separate
bankruptcy cases on the same date.
The Debtors engaged Stephen A. McCartin, Esq., and Mark C. Moore,
Esq., at Gardere Wynne Sewell LLP, as Chapter 11 counsel. Focus
Management Group,
USA, Inc., is the financial advisor. JND Corporate Restructuring
is the official noticing, claims and balloting agent.
On Nov. 28, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The Committee retained
Gray Reed & McGraw LLP as counsel, and CohnReznick LLP as financial
advisor.
PROVIDENCE WIRELESS: Taps Rice Pugatch Robinson as Special Counsel
------------------------------------------------------------------
Providence Wireless, LLC, seeks authorization from the U.S.
Bankruptcy Court for the Southern District of Florida to employ
Arthur Rice and Rice Pugatch Robinson Storfer & Cohen as special
counsel to advise and represent it regarding the claims alleged by
TowerComm.
creditors.
Professional services Rice Pugatch will render are:
a. represent the Debtor in the Lawsuits;
b. review any claims asserted against the Debtor by creditors
of TowerComm, including any proofs of claim filed in this
bankruptcy case;
c. represent the Debtor in all proceedings before this Court
or other courts of competent jurisdiction regarding the Lawsuits
and Claims;
d. advise the Debtor concerning the Lawsuits and Claims;
e. prepare and review motions, pleadings, orders, adversary
proceedings, and other legal documents arising from or related to
the foregoing; and
f. perform all other legal services for the Debtor arising
from or related to the foregoing which may be necessary.
Rice Pugatch's hourly rates are:
Attorneys $300 to $550
Legal assistants $160
Arthur Rice $550
Arthur Halsey Rice attests that his firm does not represent or hold
any interest adverse to the debtor or to the estate with respect to
the matter on which such attorneys is to be employed.
The counsel can be reached through:
Arthur Halsey Rice, Esq.
Rice Pugatch Robinson Storfer & Cohen PLLC
Fort Lauderdale Office
101 NE 3rd Ave., Suite 1800
Fort Lauderdale, FL 33301
Phone: (954) 462-8000
Fax: (954) 462-4300
About Providence Wireless
Providence Wireless LLC -- http://providencewireless.com/-- is a
provider of wireless tower services based in Miami, Florida, whose
core business is network and construction services, including new
site builds, site modifications, radio work, and site maintenance.
Providence Wireless filed a Chapter 11 petition (Bankr. S.D. Fla.
Case No. 18-11940) on Feb. 21, 2018. In the petition signed by
James Martin, president, the Debtor disclosed $752,982 in total
assets and $4.06 million in total liabilities. The case is
assigned to Judge Robert A Mark. The Debtor is represented by
Bradley S. Shraiberg, Esq., at Shraiberg Landau & Page PA.
PROVIDENCE WIRELESS: Taps Shraiberg Landau as Legal Counsel
-----------------------------------------------------------
Providence Wireless, LLC, seeks approval from the U.S. Bankruptcy
Court for the Southern District of Florida to hire Shraiberg,
Landau & Page, P.A., as its legal counsel.
The firm will advise the Debtor regarding matters of bankruptcy
law; negotiate with creditors; assist in the preparation of a plan
of reorganization; and provide other legal services related to its
Chapter 11 case.
The hourly rates for the firm's attorneys range from $225 to $525.
Legal assistants charge $175 per hour.
Bradley Shraiberg, Esq., a partner at SLP and the attorney who will
be handling the case, charges an hourly fee of $525.
Prior to the petition date, ACM Capital Advisors Group LLC, a
company controlled by the 100% shareholder of the Debtor, provided
SLP with a $52,000 retainer, which includes $1,717 for the filing
fee.
Mr. Shraiberg disclosed in a court filing that his firm does not
represent any interests adverse to the Debtor's estate.
The firm can be reached through:
Bradley S. Shraiberg, Esq.
Shraiberg, Landau & Page, P.A.
2385 NW Executive Center Drive, Suite 300
Boca Raton, FL 33431
Phone: 561-443-0800
Fax: 561-998-0047
E-mail: bss@slp.law
About Providence Wireless
Providence Wireless, LLC, is a radiotelephone communication company
located in Alpharetta, Georgia.
Providence Wireless sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-11940) on Feb. 21,
2018. Judge Robert A. Mark presides over the case. At the time of
the filing, the Debtor estimated assets and liabilities of
$1,000,001 to $10 million.
PUERTO RICO: Contract Spending Speeds Up with Army Corps Exit
-------------------------------------------------------------
Andrew Scurria, writing for The Wall Street Journal Pro Bankruptcy,
reported that Puerto Rican utility company Prepa expects to spend
more than $960 million through June on two mainland U.S.-based
firms that were hired to repair downed electricity lines.
According to a liquidity forecast compiled and reviewed by the
Journal, payments to those contractors, Cobra Acquisitions LLC and
Whitefish Energy Holdings LLC, make up more than half of Prepa's
projected 10-month, $1.5 billion budget for emergency work
following the devastation of Hurricane Maria.
Since the storm, Prepa has more than tripled the size of Cobra's
contract to $945 million, fueling an 82% jump in its stock price
since it signed the deal, the report related. By contrast, Prepa
expects to spend $350 million on grid repair work under so-called
mutual assistance programs with stateside electric utilities,
according to the internal forecast, the report further related.
The Journal pointed out that the document, entered as evidence in
February in Prepa's court-supervised bankruptcy, underscores how
heavily Prepa has relied on for-profit contractors instead of
mutual aid deals, which are emergency assistance agreements between
utilities that don't include a profit element.
Utilities are working under mutual assistance in Puerto Rico "on a
not-for-profit basis," the report said, citing a spokesman for the
Edison Electric Institute, a trade group of investor-owned
utilities. EEI and other utility groups have roughly 1,500 crews in
Puerto Rico providing mutual aid, the report said. But Prepa
failed to activate these programs in the immediate aftermath of the
storm and made its first mutual aid request Oct. 31, one day after
Gov. Ricardo Rosselló canceled the controversial Whitefish
contract, the report added.
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, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
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,
and management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
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 on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Youngis
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
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
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. The Creditors Committee tapped Paul Hastings LLP and
O'Neill & Gilmore LLC as counsel.
QUALITY CARE: Inks Plan Support Agreement with HCR ManorCare
------------------------------------------------------------
Quality Care Properties, Inc., has entered into a plan sponsor
agreement with HCR ManorCare, Inc., HCP Mezzanine Lender, LP, a
wholly owned subsidiary of QCP, and certain lessors. The Plan
Sponsor Agreement contemplates that, among other things, pursuant
to a prepackaged plan of reorganization of HCR ManorCare under
Chapter 11 of the Bankruptcy Code, HCP Mezzanine will acquire all
of the newly issued and outstanding common stock of HCR ManorCare,
in exchange for the discharge under the Plan of all claims of QCP
against HCR ManorCare and its subsidiaries arising under the
Guaranty of Obligations by HCR ManorCare, effective as of Feb. 11,
2013 of the Master Lease.
The Plan will be based on, and will contain terms consistent in
form and substance with, the restructuring term sheet dated
March 2, 2018, which includes the following terms:
* All of QCP's claims against HCR ManorCare will be cancelled
in exchange for all of the issued and outstanding capital
stock of the reorganized HCR ManorCare;
* All creditors of HCR ManorCare other than QCP will be
unimpaired under the Plan; and
* The Plan will include customary releases and exculpation by
HCR ManorCare of the reorganized HCR ManorCare, its current
and former representatives, and QCP.
The Plan Sponsor Agreement provides that, during the period prior
to the closing of the transactions contemplated by the Plan Sponsor
Agreement, Guy Sansone and Laura Linynsky will serve as consultants
reporting to QCP and will be provided with certain rights and
access to information of HCR ManorCare, as well as access to the
board of directors, officers and employees of HCR ManorCare,
subject to oversight by the chief restructuring officer of HCR
ManorCare. HCR ManorCare will also provide the QCP Consultants
with such information and access to HCR ManorCare's properties and
personnel as they or QCP reasonably request in order to, among
other things, formulate a comprehensive, detailed business plan for
HCR ManorCare for implementation following the closing of the
Transactions. Following the completion of the Transactions, Mr.
Sansone is expected to assume the role of HCR ManorCare's chief
executive officer and Ms. Linynsky is expected to serve as HCR
ManorCareos interim chief financial officer.
The Plan Sponsor Agreement contains additional commitments by HCR
ManorCare and QCP relating to the voluntary Chapter 11 filing for
reorganization by HCR ManorCare, including to use reasonable best
efforts to pursue entry of a confirmation order by the Bankruptcy
Court confirming a Plan consistent in form and substance with the
arrangements provided in the Term Sheet within forty days of the
filing of the bankruptcy petition.
The consummation of the Transactions is subject to certain mutual
conditions, including (i) the receipt of certain state licensing
approvals with respect to the Transactions, (ii) the entry by the
bankruptcy court of a confirmation order confirming a Plan with
terms consistent in form and substance with those set out in the
Term Sheet, or otherwise reasonably acceptable to QCP and HCR
ManorCare, and such order having become a final order and (iii) no
entry of an order by the bankruptcy court dismissing the Chapter 11
Case or converting the Chapter 11 Case into a case under Chapter 7
of the Bankruptcy Code or an order materially inconsistent with the
Plan Sponsor Agreement, the Plan or the confirmation order in a
manner adverse to QCP. The obligation of each party to consummate
the Transactions is also conditioned upon (i) compliance by the
other party in all material respects with its pre-closing
obligations under the Plan Sponsor Agreement, and (ii) the accuracy
of the representations and warranties of the other party as of the
date of the Plan Sponsor Agreement and as of the closing of the
Transactions (subject to customary materiality qualifiers).
The Plan Sponsor Agreement will automatically terminate if certain
milestones related to the Chapter 11 case are not met. The Plan
Sponsor Agreement may also be terminated by QCP if there has been a
material breach of the "no shop" covenant or if HCR III Healthcare
LLC, a wholly owned subsidiary of HCR ManorCare, fails to pay such
cash and cash equivalents available to pay all or part of the
Reduced Cash Rent (as defined in the Master Lease) after making all
transfers of funds permitted under the credit agreement of HCR
ManorCare and its subsidiaries and retaining such reserves and
making such other expenditures that either the chief restructuring
officer or the board of directors of HCR ManorCare has determined
would be necessary to allow HCR ManorCare to operate in the
ordinary course of business. Either QCP or HCR ManorCare may also
terminate the Plan Sponsor Agreement if the Transactions have not
been consummated by Sept. 30, 2018.
QCP and HCR ManorCare have made customary representations,
warranties and covenants in the Plan Sponsor Agreement. Many of
the representations made by HCR ManorCare are subject to and
qualified by Material Adverse Effect (as defined in the Plan
Sponsor Agreement). QCP and HCR ManorCare have also agreed to
customary covenants in the Plan Sponsor Agreement, including
covenants regarding the operation of the business of HCR ManorCare
and its subsidiaries prior to the effective time of the
Transactions and a "no shop" covenant prohibiting HCR ManorCare
from soliciting, providing non-public information in connection
with or entering into discussions or negotiations concerning
proposals relating to alternative business combination
transactions. In addition, QCP and HCR ManorCare have agreed to
use their respective reasonable best efforts to prepare and file
all documentation to obtain required regulatory approvals. The
Plan Sponsor Agreement provides that HCR ManorCare will use
reasonable best efforts to cooperate with QCP in connection with
any financing by QCP or HCR ManorCare, including the refinancing of
HCR ManorCare's indebtedness under the Centerbridge Facility (as
defined in the Plan Support Agreement).
On the closing date of the Transactions, the Lessors and HCR III
will also enter into an amendment to the Master Lease and Security
Agreement, dated as of April 7, 2011, as amended and supplemented
from time to time in the form attached to and incorporated into the
Plan Sponsor Agreement. The Master Lease Amendment will provide
that, among other things, from the Closing Date until the seventh
anniversary of the Closing Date, HCR III will be permitted to defer
paying any portion of the monthly minimum rent due to the Lessors
to the extent that HCR III does not have cash and cash equivalents
available to make such payment in a calendar month after HCR III
retains amounts reasonably required, taking into account projected
receipts to satisfy HCR III's monthly cash needs and liabilities
reasonably anticipated to be paid in cash within ninety days of the
first business day of such calendar month. In addition, pursuant
to the Master Lease Amendment, HCR III's existing deferred rent
obligation and any accrued but unpaid rent under the Master Lease
will be released. On the Closing Date, HCR III and its
subsidiaries to whom HCR III subleases certain facilities will
amend their applicable sublease agreements to reflect the terms of
the Master Lease Amendment. Within seven days after the Closing
Date, HCR ManorCare, HCR III, and the lessors under the Master
Lease will terminate, release and discharge the Guaranty.
Restructuring Support Agreement
Concurrently with the execution of the Plan Sponsor Agreement, HCR
ManorCare, Carlyle MC Partners, L.P., a Delaware limited
partnership, Carlyle Partners V-A MC, L.P., a Delaware limited
Partnership, Carlyle Partners V MC, L.P., a Delaware limited
partnership, CP V Coinvestment A, L.P., a Delaware limited
partnership, CP V Coinvestment B, L.P., a Delaware limited
partnership and MC Operations Investments, LLC, a wholly owned
indirect subsidiary of QCP, entered into a restructuring support
agreement, pursuant to which, subject to the terms and conditions
therein, the Restructuring Support Parties, as the owners of common
stock of HCR ManorCare, covenanted to, among other things, support
the Transactions and a Plan consistent in form and substance with
the arrangements set forth in the Term Sheet, and not to take any
action, directly or indirectly, that could interfere with the
confirmation of said Plan or the consummation of the Transactions.
In addition, the Restructuring Support Parties agreed not to
transfer, sell or pledge their HCR ManorCare common stock or the
right to vote unless the transferee of those shares joins the
Restructuring Support Agreement.
All obligations pursuant to the Restructuring Support Agreement
will terminate upon the earlier of the effective date of the Plan
or the date of termination of the Plan Sponsor Agreement. As of
March 2, 2018, the Restructuring Support Parties collectively owned
38,901,801 shares of common shares of HCR ManorCare, representing
more than eighty percent of the total shares of common stock of HCR
ManorCare issued and outstanding on that date.
On March 4, 2018, as required by the Plan Sponsor Agreement, HCR
ManorCare filed a voluntary petition for reorganization under
Chapter 11 of the Bankruptcy Code in the United States Bankruptcy
Court for the District of Delaware.
About HCR ManorCare
Headquartered in Toledo, Ohio, HCR ManorCare, Inc. --
https://www.hcr-manorcare.com/ -- is a national healthcare provider
that, through certain non-debtor providers, operates a network of
more than 450 locations nationwide across these business segments:
(a) skilled nursing and inpatient rehabilitation facilities (SNFs),
memory care facilities, and assisted living facilities; (b) hospice
and home health care agencies; and (c) outpatient rehabilitation
clinics and other ancillary healthcare and related businesses. The
company has approximately 50,000 employees in full- and part-time
positions.
HCR ManorCare sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 18-10467) on March 4, 2018, with a
deal in which its landlord, Quality Care Properties Inc., will take
control of the company.
In the petition signed by CRO John R. Castellano, the Debtor
disclosed $4.264 billion in assets and $7.118 billion in
liabilities as of Dec. 31, 2017.
Judge Kevin Gross presides over the case.
The Debtor hired Sidley Austin LLP as bankruptcy counsel; Young,
Conaway, Stargatt & Taylor LLP as Delaware counsel; Moelis &
Company LLC as investment banker; and AP Services LLC as financial
advisor.
About Quality Care
Quality Care Properties, Inc., headquartered in Bethesda, Maryland,
was formed in 2016 to hold the HCR ManorCare portfolio, 28 other
healthcare related properties, a deferred rent obligation due from
HCRMC under a master lease and an equity method investment in HCRMC
previously held by HCP, Inc.
As of Sept. 30, 2017, Quality Care had $4.46 billion in total
assets, $1.80 billion in total liabilities, $1.93 million in
redeemable preferred stock and $2.65 billion in total equity.
* * *
In December 2017, S&P Global Ratings lowered its corporate credit
rating on Quality Care Properties to 'CCC' from 'B-'. "The
downgrade reflects our view that QCP has limited covenant cushion
and a heightened probability of breaching its DSC covenant as early
as the first or second quarter of 2018 absent an amendment of its
credit facilities, waiver by the lenders, or possible debt or
company reorganization.
In October 2017, Moody's Investors Service confirmed Quality Care's
ratings, including its 'Caa1' corporate family rating following
QCP's announcement that the REIT's work-out discussions with its
struggling tenant, HCR Manorcare, Inc. (HCR, unrated), are
continuing.
REAL ALLOY: Unsecureds Back Sale of Real Alloy to Noteholders
-------------------------------------------------------------
Real Alloy Holding, Inc., on March 8, 2018, disclosed that the
Company and the ad hoc group comprised of certain Real Alloy
noteholders led by funds and accounts managed by DDJ Capital
Management have reached an agreement in principal with the Official
Committee of Unsecured Creditors (the "Committee") under which the
Committee will support the sale of Real Alloy to the noteholder
group pursuant to the terms and conditions of an asset purchase
agreement filed with the Bankruptcy Court on March 8, 2018. Under
the asset purchase agreement, the noteholder group has agreed to
acquire substantially all of Real Alloy's US and international
operations for an estimated total purchase consideration of
approximately US$364 million, plus the assumption of certain
liabilities. The noteholder group's bid will remain subject to
higher and better bids, as contemplated by the bid procedures
approved by the Bankruptcy Court.
As part of reaching an agreement with the Committee, the asset
purchase agreement provides for the assumption by the buyer of
certain priority and unsecured claims of the estate. Specifically,
the purchaser has committed to assume up to US$18.6 million in
liabilities on account of these claims. Under the asset purchase
agreement, 503(b)(9) claimants may receive as much as 100% on
account of their claims as an upfront payment at closing in
exchange for terms including negotiated credit limits, volume and
pricing. Vendors holding general unsecured claims may also receive
recoveries on their claims, depending upon credit and other
commercial terms offered.
Under the terms of the "stalking horse bid", the Company is
expected to see its secured debt obligations reduced by
approximately $200 million, which will provide the Company with a
strong balance sheet and ample liquidity post Chapter 11
emergence.
During this process, Real Alloy will continue its operations
uninterrupted in the ordinary course of business, and will meet
day-to-day obligations to its customers, suppliers of goods and
services, and employees.
Management Comments
Terry Hogan, President of Real Alloy, stated, "We remain on track
to complete the sale process as planned by the end of April and are
pleased that Real Alloy's secured and unsecured creditors have been
able to reach a mutually agreeable settlement at this time. This
paves the way forward for the Company. As we work as expeditiously
as possible toward closing, our day-to-day operations will move
forward as usual, and we look forward to providing further updates
in the coming weeks."
Additional Information on the Chapter 11 Proceedings
Court filings and other information related to the court-supervised
proceedings are available at a website administered by the
Company's claims agent, Prime Clerk, at
https://cases.primeclerk.com/realindustry. Additional information
on Real Alloy can be found at its website www.realalloy.com
About Real Industry
Based in Beachwood, Ohio, Real Industry, Inc. (NASDAQ:RELY) is the
holding company for Real Alloy, the largest third-party aluminum
recycler in both North America and Europe. Real Alloy offers
products to wrought alloy processors, automotive original equipment
manufacturers, foundries, and casters. Real Alloy delivers
recycled metal in liquid or solid form according to customer
specifications and serves the automotive, consumer packaging,
aerospace, building and construction, steel, and durable goods
industries.
Real Industry has no funded debt. The funded debt obligations of
the Real Alloy debtors total $400 million, comprised of (i) $96
million outstanding under a $110 senior secured revolving
asset-based credit facility with Bank of America, and (ii) $305
million in principal outstanding under 10.00% senior secured notes
due 2019.
Real Industry, Inc., and Real Alloy Intermediate Holding, LLC, Real
Alloy Holding, Inc., and their U.S. subsidiaries filed voluntary
petitions seeking relief under Chapter 11 of the Bankruptcy Code in
Delaware on Nov. 17, 2017.
The Honorable Kevin J. Carey is the case judge.
The Debtors tapped Saul Ewing Arnstein & Lehr LLP as local
bankruptcy counsel; Jefferies LLC as the debtors' investment
banker; Berkeley Research Group, LLC as financial advisor; Ernst &
Young LLP as auditor and tax advisor; and Prime Clerk as the claims
and noticing agent and administrative advisor.
The Ad Hoc Noteholder Group tapped Latham & Watkins LLP as counsel;
Young Conway Stargatt & Taylor LLP as Delaware counsel; and Alvarez
& Marsal Securities, LLC, as financial advisor.
DDJ Capital Management, LLC, Osterweis Capital Management, HPS
Investment Partners, LLC, Hotchkis & Wiley Capital Management, and
Southpaw Credit Opportunity Master Fund L.P. comprise the Ad Hoc
Noteholder Group.
The Official Committee of Unsecured Creditors tapped Brown Rudnick
LLP as counsel; Duane Morris LLP as Delaware counsel; Miller
Buckfire & Co, LLC, as investment banker; and Goldin Associates,
LLC, as financial advisor.
The Ad Hoc Committee of Equity Holders of Real Industry tapped the
firms of Dentons US LLP and Bayard, P.A., as counsel.
* * *
Real Alloy entered into an agreement with its existing asset-based
facility lender and certain of its bondholders for continued use of
its $110 million asset-based lending facility and up to $85 million
of additional liquidity through debtor-in-possession financing to
fund ongoing business operations.
As Real Industry has no access to the Real Alloy debtors'
postpetition financing, Real Industry accepted an unsolicited
proposal from 210 Capital, LLC and the Private Credit Group of
Goldman Sachs Asset Management L.P. for (i) up to $5.5 million in
postpetition financing, (ii) an equity commitment of $17 million
for up to 49% of the common stock, and (iii) a commitment to
provide a $500 million acquisition financing facility on terms to
be negotiated.
REAL T PROPERTIES: Taps Mark S. Roher as Legal Counsel
------------------------------------------------------
Real T Properties 2 LLC seeks approval from the U.S. Bankruptcy
Court for the Southern District of Florida to hire Mark S. Roher,
P.A. as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; represent the Debtor in negotiations with its
creditors in the preparation of a bankruptcy plan; and provide
other legal services related to its Chapter 11 case.
Mark Roher, Esq., president of the firm and the attorney who will
be handling the case, will charge an hourly fee of $275. The
Debtor has agreed to pay his firm a retainer in the sum of
$10,000.
Mr. Roher disclosed in a court filing that he and his firm do not
represent any interest adverse to the Debtor and its estate.
The firm can be reached through:
Mark S. Roher, Esq.
Mark S. Roher, P.A.
5989 Stirling Road
Fort Lauderdale, FL 33314
Phone: 954-353-2200
Fax: 877-654-0090
E-mail: mroher@markroherlaw.com
About Real T Properties 2
Real T Properties 2 LLC is a nonresidential building operator
located in Portsmouth, New Hampshire. Real T Properties sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Fla. Case No. 18-11867) on Feb. 19, 2018. At the time of the
filing, the Debtor estimated assets and liabilities of less than
$500,000.
RESOLUTE ENERGY: Fir Tree Narrows Stake to 7.1% as of March 1
-------------------------------------------------------------
Fir Tree Capital Management LP disclosed in a Schedule 13D/A filed
with the Securities and Exchange Commission that as of March 1,
2018, it beneficially owns 1,616,027 shares of common stock
(including 101,585 shares of Common Stock issuable upon conversion
of 8 1/8% Series B Cumulative Perpetual Convertible Preferred
Stock) of Resolute Energy Corporation, constituting 7.15 percent of
the shares outstanding.
The percentage is calculated based upon 22,503,907 shares of Common
Stock issued and outstanding as of Oct. 31, 2017, as reported in
the Issuer's Quarterly Report on Form 10-Q for the quarterly period
ended Sept. 30, 2017, filed with the SEC on
Nov. 6, 2017 as well as the 101,585 additional shares of Common
Stock that are issuable upon conversion of the 8 1/8 Series B
Cumulative Perpetual Convertible Preferred Stock held by the
Reporting Person.
For the period from Feb. 27 through March 5, 2018, Fir Tree sold a
total of 411,210 Shares of the Company.
A full-text copy of the regulatory filing is available at:
https://is.gd/cMyWTp
About Resolute Energy
Based in Denver, Colorado, Resolute Energy Corp. (NYSE:REN) --
http://www.resoluteenergy.com/-- is an independent oil and gas
company focused on the acquisition and development of
unconventional oil and gas properties in the Delaware Basin portion
of the Permian Basin of west Texas.
Resolute reported a net loss of $161.7 million in 2016, a net loss
of $742.3 million in 2015, and a net loss of $21.85 million in
2014. The Company had $792.3 million in total assets, $866.1
million in total liabilities, and a total stockholders' deficit of
$73.76 million as of Sept. 30, 2017.
REVOLUTION ALUMINUM: Trustee Plan to Reissue New Equity Interests
-----------------------------------------------------------------
Lucy G. Sikes, the Chapter 11 Trustee of Debtor Revolution Aluminum
Propco, LLC, filed with the U.S. Bankruptcy Court for the Western
District of Louisiana a third amended disclosure statement for the
Debtor's third amended plan of reorganization.
The plan proposes to cancel existing equity in the Debtor and
reissue new equity interests to an approved purchaser of such new
equity interests. Cash from the sale of such new equity will be
apportioned between a reserve for the benefit of certain alleged
secured creditors of the Estate and the unsecured creditors of the
Estate (80% of proceeds will be designated for the Lienholders'
Reserve, and 20% of the proceeds will be designated for use free of
Property lienholder creditor claims. The plan establishes a
liquidating trust which will hold all funds from the sale of new
equity interest. Once the Bankruptcy Court has fixed the extent
and priority of certain lien claims in, to and upon the immovable
property owned by the Estate, the liquidating trust will then be
authorized to distribute funds held as the Lienholders' Reserve in
accordance with the final orders of the Bankruptcy Court. The
Liquidating Trust will use the remaining funds to investigate
causes of action against third parties which may result in greater
recovery for unsecured creditors and to distribute the funds not
subject to reserve to unsecured creditors in the priority
established in the plan.
The Trustee has proposed the plan based on what she believes to be
the best interests of the Estate. The Debtor does not operate but
holds two illiquid assets -- the immovable property and the bond
rights covering the immovable property. Continued maintenance of
the business going forward almost certainly would not result in a
substantial recovery to creditors. A sale of the assets and
distribution of the proceeds would be preferable. Due to the
presence of the bond rights as a component asset of the Estate's
patrimony, the mechanism to cancel old equity and sell new equity
interests will allow the purchaser of such new equity to own the
land and bond rights free and clear of liens and claims and
interests under the plan as well as providing a path to monetize
the bond rights. Such sale should provide for greater recovery to
creditors of the estate in a much more timely fashion than an
extended marketing and sale process which may be complicated by the
bond monetization issues. The trustee believes that the
classification and treatment of claims and interests provided for
in the plan are consistent with the requirements in the Bankruptcy
Code.
A full-text copy of the Trustee's Third Amended Disclosure
Statement is available at:
http://bankrupt.com/misc/lawb16-81024-404.pdf
A copy of the Trutee's Third Amended Plan is available at:
http://bankrupt.com/misc/lawb16-81024-405.pdf
About Revolution Aluminum Propco
Revolution Aluminum Propco, LLC, is a Louisiana company established
in 2015. It owns a real property comprised of approximately 1,400
acres in Pineville, Louisiana. The property, which is the
Company's sole asset, is an industrial park and the former site of
a paper mill.
Revolution Aluminum Propco is 100% owned by its parent company,
Revolution Aluminum LLC, and is managed by Roger Boggs.
Ryan & Associates, Inc., Engineered Products, Inc., and Tina J.
Hertzel filed an involuntary Chapter 11 case (Bankr. W.D. La., Case
No. 16-81024) against Revolution Aluminum Propco on Sept. 15, 2016.
The Court entered an order officially placing the Debtor in
bankruptcy on Feb. 1, 2017.
The petitioning creditors are represented by Bradley L. Drell,
Esq., at Gold, Weems, Bruser, Sues & Rundell.
Steffes, Vingiello & McKenzie, LLC, serves as the Debtor's
bankruptcy counsel. The Debtor hired Beau Box Real Estate as real
estate broker and manager.
On March 16, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee hired
Gold Weems Bruser Sues & Rundell, APLC, as counsel.
Lucy G. Sikes was appointed Chapter 11 trustee for the Debtor.
ROBERT T. WINZINGER: Seeks 90-Day Extension of Exclusivity Periods
------------------------------------------------------------------
Robert T. Winzinger, Inc., asks the U.S. Bankruptcy Court for the
District of New Jersey for an additional 90-day extension of the
exclusivity periods within which to file and solicit acceptances to
a plan pursuant to 11 U.S.C. Section 1121(d)(1).
A hearing on the Debtor's Motion has been scheduled to take place
on April 3, 2018 at 10:00 a.m. Written response are due on or
before March 27, 2018.
While the Debtor contemplates operating and liquidating of some of
its assets, the major asset that it owns is the recycling plant in
Franklinville, NJ. The Debtor is accepting bids for this
specialized asset from people in the industry. It is contemplated
that this asset will produce significant value to be paid to the
creditors of this estate, including, but not limited to, producing
sufficient value to be able to pay the secured claim of Investors
Bank in full.
However, the Debtor tells the Court that the bidding process is
ongoing and is not complete and if there is an acceptable bid, it
will be subject to significant contingencies because there are many
licenses and approvals that would have to be transferred for this
asset to be retained by a purchaser as a recycling facility.
Because all of this is unknown at this point in time, the Debtor
claims that it is difficult to structure a plan at this particular
point in time.
Therefore, the Debtor is asking for an additional increase of the
exclusivity periods as this will give the Debtor significantly more
ability to structure a plan, which will result in the maximum
monies that will be available to the creditor body through a
chapter 11 plan.
ROSE COURT: Unsecured Creditors to Get 100% Under Plan
------------------------------------------------------
Rose Court, LLC, filed a plan of reorganization and accompanying
disclosure statement proposing to pay general unsecured creditors
100% of their allowed claim in one payment, due on the first day of
the month following confirmation of the Plan.
The Debtor's general unsecured creditors are:
Franchise Tax Board $438.92
Internal Revenue Service $3,254.26
US Bank's secured claim in will be paid in the entire amount with
interest in 60 equal monthly payments of $7,267.81. Chase Bank's
secured claim will be paid in the entire amount with interest in
120 equal monthly payments of $1,036.38.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/canb17-31014-43.pdf
About Rose Court
Rose Court, LLC, a real estate company, is the owner of a real
property located at 15520 Quito Rd., Monte Sereno, CA 95030, valued
by the Company at $3.50 million. Rose Court's gross revenue from
rental investment amounted to $99,762 in 2016 compared to gross
revenue from rental investment of $150,000 in 2015. The Company
previously sought bankruptcy protection on Feb. 1, 2010 (Bankr.
N.D. Cal. Case No. 10-50993) and Nov. 6, 2012 (Bankr. N.D. Cal.
Case No. 12-58012).
Rose Court, LLC, based in San Francisco, CA, filed a Chapter 11
petition (Bankr. N.D. Cal. Case No. 17-31014) on Oct. 10, 2017. In
the petition signed by Teri Nguyen, managing member, the Debtor
disclosed $3.51 million in assets and $3.28 million in liabilities.
The Hon. Hannah L. Blumenstiel presides over the case. Vince D.
Nguyen, Esq., at Newton Law Group, serves as bankruptcy counsel to
the Debtor.
SCRIBEAMERICA INTERMEDIATE: Moody's Assigns B3 Corp. Family Rating
------------------------------------------------------------------
Moody's Investors Service assigned a B3 Corporate Family Rating and
B3-PD Probability of Default Rating to ScribeAmerica Intermediate
Holdco, LLC (dba "HealthChannels"). Moody's also assigned B3
ratings to HealthChannels' $20 million senior secured revolving
credit facility and $250 million senior secured term loan. The
outlook is stable. This is the first time Moody's has assigned
ratings to HealthChannels.
Proceeds will be used to refinance existing debt and pay a $100
million distribution.
Ratings assigned:
ScribeAmerica Intermediate Holdco, LLC
Corporate Family Rating at B3
Probability of Default Rating at B3-PD
Senior secured first lien revolving credit facility expiring 2023
at B3 (LGD4)
Senior secured first lien term loan due 2025 at B3 (LGD4)
The outlook is stable.
RATINGS RATIONALE
The B3 Corporate Family Rating reflects HealthChannels' very narrow
focus on the medical scribe industry. While the industry has shown
rapid growth during the past few years, the market is still in its
early stages which creates uncertainty. The ratings also reflect
HealthChannels' high financial leverage with debt/EBITDA expected
to remain above 5.25 times for the next 12-18 months. The company
has small scale with pro forma revenues of approximately $260
million. The B3 CFR reflects Moody's expectation that the company
will continue to have an aggressive financial policy evidenced by
the sizeable distribution to its owners. The ratings are further
constrained by Moody's expectations that the company will remain
acquisitive, which gives rise to integration and execution risk. An
additional ratings constraint is customer concentration given that,
while spread across multiple sites and markets, one customer
accounts for 11% of revenues.
The ratings are supported by HealthChannels' market leading
position within the medical scribe industry niche. The ratings are
further supported by HealthChannels' ability to smoothly integrate
recent acquisitions and capture synergies within the first year of
operation. The ratings also reflect good liquidity as Moody's
expect the company will maintain positive free cash flow and access
to a $20 million revolving credit facility that Moody's expects to
remain undrawn.
The stable outlook reflects Moody's view that HealthChannels will
operate with high financial leverage and an maintain aggressive
financial policies over the next 12-18 months.
The ratings could be downgraded if the company's operating
performance weakens such that free cash flow turns negative.
Debt-funded distributions or a deterioration in liquidity could
also result in a ratings downgrade.
The ratings could be upgraded if HealthChannels effectively manages
its growth while achieving greater scale. An upgrade could also
occur if the company sustains debt/EBITDA approaching 5.0 times and
demonstrates more conservative financial policies.
HealthChannels, LLC provides medical scribing services to hospitals
and physician staffing companies. Pro forma LTM revenues are
approximately $260 million. HealthChannels is majority-owned by
private equity firm Vesey Street Capital Partners, LLC.
SEMLER SCIENTIFIC: Incurs $1.5 Million Net Loss in 2017
-------------------------------------------------------
Semler Scientific, Inc. filed with the Securities and Exchange
Commission its annual report on Form 10-K reporting a net loss of
$1.51 million on $12.45 million of revenues for the year ended Dec.
31, 2017, compared to a net loss of $2.55 million on $7.43 million
of revenues for the year ended Dec. 31, 2016.
For the three months ended Dec. 31, 2017, Semler Scientific
reported net income of $254,000 on $4.21 million of revenues
compared to a net loss of $220,000 on $2.31 million of revenues for
the same period during the prior year.
At Dec. 31, 2017, Semler Scientific had $4.23 million in total
assets, $6.82 million in total liabilities and a total
stockholders' deficit of $2.58 million.
"Revenue growth continues to outpace increases in expenses," said
Doug Murphy-Chutorian, M.D., chief executive officer of Semler. "We
are pleased that in the fourth quarter of 2017 we achieved our
first profitable quarter in the company's history," he continued.
The Company recorded $251,000 of fixed asset impairment in the
fourth quarter of 2017 for old WellChec equipment, which negatively
affected both operating expenses and net income. Such impairment
charge was equal to approximately $0.05 per share (basic), or $0.04
per share (diluted).
"We expect revenues to continue to grow due to an increasing number
of QuantaFlo installations resulting from new orders, higher
average pricing as compared to its predecessor product and the
recurring revenue business model that we employ. We expect to see
continued annual revenue growth and continued profitability in
2018. We believe expenses will continue to increase as the
business expands. However, it is our intent to continue to grow
revenues at a faster rate than expenses and to remain profitable.
"It is gratifying that medical providers are incorporating our
product into their standard of care and following the guidelines of
the American Heart Association, American College of Cardiology and
the American Diabetes Association as to peripheral artery disease,"
said Dr. Murphy-Chutorian. "The intention of these recommendations
is to identify patients at risk for heart attack, stroke and
amputation, which in turn leads to the initiation of better
preventive medical care," he concluded.
Going Concern & Liquidity
The Company's independent registered public accountants' report for
the year ended Dec. 31, 2017 includes an explanatory paragraph that
expresses substantial doubt about its ability to continue as a
"going concern." BDO USA, LLP, in New York, NY, stated that the
Company has negative working capital, a stockholders' deficit, and
recurring losses from operations that raise substantial doubt about
its ability to continue as a going concern.
Semler said its ability to continue as a going concern is dependent
upon its ability to attain further operating efficiencies and,
ultimately, to generate additional revenues. The Company can give
no assurances that additional capital that the Company is able to
obtain, if any, will be sufficient to meet the Company's needs.
The Company had cash of $1,457,000 at Dec. 31, 2017 compared to
cash of $622,000 at Dec. 31, 2016, and total current liabilities
of $5,140,000 at Dec. 31, 2017 compared to $3,229,000 at Dec.
31, 2016. As of Dec. 31, 2017 the Company had negative working
capital of approximately $2,257,000 as compared to $1,673,000 in
2016.
The Company generated $621,000 of net cash from operating
activities for the year ended Dec. 31, 2017 compared to using
$1,804,000 of net cash in operating activities for the year ended
Dec. 31, 2016. The improvement was primarily due to changes in
both non-cash adjustments and operating assets and liabilities,
which occurred due to growth in our business, which affected
depreciation, accrued expenses, accounts payable and trade accounts
receivable, as well as new annual contracts in the latter part of
2017, which increased deferred revenue. The Company also modified
the terms of two outstanding notes in May 2017, which resulted in
accretion of non-cash interest and loss on extinguishment of debt.
The Company used $968,000 of net cash in investing activities for
the year ended Dec. 31, 2017, primarily attributable to purchase of
assets for lease of $924,000 and additions to property and
equipment of $47,000, to support its growing business. The Company
used $814,000 of net cash in investing activities for the year
ended Dec. 31, 2016, primarily attributable to purchases of assets
for lease of $591,000 as well as additions to property and
equipment of $223,000 to support of its growing business.
A full-text copy of the Form 10-K is available for free at:
https://is.gd/e6kt5l
About Semler Scientific
Semler Scientific, Inc. — http://www.semlercientific.com/—
provides diagnostic and testing services to healthcare insurers and
physician groups. The Portland, Oregon-based Company develops,
manufactures and markets proprietary products and services that
assist healthcare providers in evaluating and treating chronic
diseases.
SENIOR CARE: Exclusive Plan Filing Period Extended to April 30
--------------------------------------------------------------
The Hon. Catherine Peek McEwen of the U.S. Bankruptcy Court for the
Middle District of Florida extended the periods during which the
Senior Care Group, Inc. and its affiliates have the exclusive right
to file a Chapter 11 plan and to solicit acceptances, through and
including April 30, 2018 and June 29, 2018, respectively; and the
deadline by which the Debtors have to file their plan and
disclosure statement through and including April 30, 2018.
The Troubled Company Reporter has previously reported that the
Debtors sought for exclusivity extension since they have been in
the process of negotiating the sale of the operations of SCG
Baywood, LLC, SCG Gracewood, LLC, SCG Harbourwood, LLC, SCG
Laurellwood, LLC with various parties, including the Unsecured
Creditor's Committee, the real estate owners, Fifth Third, and
AHCA, which negotiations include treatment of the leases of these
four operations. The Debtors believed that resolution of the sale
process will impact the other Debtors -- Senior Care Group, Inc.,
Key West Health and Rehabilitation Center, LLC, and The Bridges
Nursing and Rehabilitation, LLC. The Parties have reached a
mediated settlement agreement and the Debtors believed that the
satisfaction of conditions in the mediated settlement agreement
will resolve the sale issues. Once the sale issues are resolved,
the Debtors will be able to focus on preparing a plan of
reorganization and disclosure statement.
About Senior Care Group
Senior Care Group, Inc., is a non-profit corporation which, through
its wholly-owned subsidiaries, provides residents and patients with
nursing and long-term health care services.
Senior Care Group and its six affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Lead Case No.
17-06562) on July 27, 2017. In the petition signed by David R.
Vaughan, chairman of the Board, Senior Care Group estimated assets
and liabilities of $1 million to $10 million.
Judge Catherine Peek Mcewen presides over the cases.
Stichter Riedel Blain & Postler, P.A., is the Debtors' bankruptcy
counsel. The Debtors hired Akerman LLP as their special healthcare
counsel.
The U.S. Trustee for Region 21 appointed Mary L. Peebles as the
patient care ombudsman for Key West Health and Rehabilitation
Center LLC, SCG Baywood LLC, SCG Gracewood LLC, and SCG
Laurellwood, LLC.
On Aug. 18, 2017, the U.S. trustee appointed an official committee
of unsecured creditors. The committee hired Stevens & Lee, P.C.,
as its bankruptcy counsel; and Trenam, Kemker, Scharf, Barkin,
Frye, O'Neill & Mullis, P.A., as co-counsel. On Aug. 17, 2017, the
Debtors retained Holliday Fenoglio Fowler, LP, as Broker.
SIVYER STEEL: Involuntary Chapter 11 Case Summary
-------------------------------------------------
Alleged Debtor: Sivyer Steel Corporation
225 S. 33rd St
Bettendorf, IA 52722
Type of Business: Sivyer Steel -- https://www.sivyersteel.com --
is a supplier of steel castings based in
Bettendorf, Iowa. Sivyer Steel is an ISO
9001:2008 recertified steel foundry, which means
that it meets the International Organization for
Standardization's quality management system.
The Company develops custom steel castings and
components for clients in industries that
include government, private, and public sectors.
Sivyer Steel specializes in military castings,
energy applications, railroad castings, wear
parts, pump & valves, oil & gas, mining,
construction castings, perimeter security, and
agriculture. The Company was founded by
Frederick Lincoln in 1909.
Involuntary Chapter 11 Petition Date: March 8, 2018
Case Number: 18-00454
Court: United States Bankruptcy Court
Southern District of Iowa (Davenport)
Judge: Hon. Anita L. Shodeen
Petitioners' Counsel: Terry L Gibson, Esq.
WANDRO & ASSOCIATES, P.C.
2501 Grand Avenue, Suite B
Des Moines, IA 50312
Tel: (515) 281-1475
Fax: (515) 281-1474
E-mail: tgibson@2501grand.com
Alleged creditors who signed the involuntary petition:
Petitioners Nature of Claim Claim Amount
----------- --------------- ------------
Sadler Machine Co. Unsecured Trade $25,270
4150 Thomas Drive, SW Debt
P.O. Box 1716
Cedar Rapids, IA 52406-1716
Speyside Machining Holdings, LLC Unsecured Trade $2,038
24 Frank Lloyd Wright Drive Debt
Suite H3225
Ann Arbor, MI 48106
ARCO Manufacturing Corporation Unsecured Trade $136,357
5429 North Towne Place, NE Debt
Cedar Rapids, IA 52402
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/iasn18-00454.pdf
SOUTHCROSS ENERGY: Gen Partner CEO Takes Medical Leave of Absence
-----------------------------------------------------------------
Bruce A. Williamson, currently the chairman, president and chief
executive officer of Southcross Energy Partners GP, LLC, the
general partner of Southcross Energy Partners, L.P., is taking a
medical leave of absence following a sudden illness, effective
March 4, 2018. At this time, it is too soon to know the course of
treatment and timing of recovery. On March 4, 2018, the Board of
Directors of the General Partner appointed David Biegler, as acting
chairman, president and chief executive officer. This appointment
is effective immediately.
Mr. Biegler will work closely with the Board of Directors of
Southcross Holdings GP and the General Partner's experienced
executive team to run the Partnership in Mr. Williamson's absence.
Holdings GP is the general partner of Southcross Holdings LP, which
indirectly owns 100% of the General Partner. The Board remains
actively engaged in preparing for all potential outcomes regarding
the Partnership's leadership structure.
Mr. Biegler, age 71, served as chairman of the Board from August
2011 to Jan. 6, 2017 and currently serves as a director of the
General Partner. Mr. Biegler served as Chairman of the Board and
chief executive officer of the General Partner from August 2011 to
December 2014 and as president of the General Partner from October
2012 to March 2014. From August 2014 to July 2016, Mr. Biegler has
also served as the Chairman of the board of directors of Holdings
GP, and he served as chief executive officer of Holdings GP from
August 2011 through December 2014. Mr. Biegler has more than 50
years of experience in the energy industry, having held various
management positions in upstream, midstream, downstream, electric
generation and oilfield services companies. From 2004 until 2012,
Mr. Biegler served as chairman and chief executive officer of
Estrella Energy LP, an entity formed for the purpose of acquiring
midstream companies, which was a founding investor in the
Partnership's predecessor. From 2002 to 2004, Mr. Biegler was
Chairman of the board of Regency Gas Services, a midstream company
that he co-founded and that was ultimately sold to a private equity
firm. He retired as vice chairman of the board of TXU Corp. (now
Energy Future Holdings Corp.) in 2001, a position he assumed
earlier that year. From 1997 to 2001, Mr. Biegler served as
president and chief operating officer of TXU Corp., the result of a
merger between Texas Utilities and ENSERCH Corp. From 1966 to
1997, he held various management positions at ENSERCH Corp. and its
upstream, midstream, downstream and oilfield field services
subsidiaries, including as ENSERCH's Chairman, President and Chief
Executive Officer from 1994 to 1997. Mr. Biegler also serves on
the board of Southwest Airlines Co., Trinity Industries, Inc. and
Austin Industries.
Mr. Biegler will continue to participate in the General Partner's
non-employee director compensation arrangements as disclosed in the
Partnership's Annual Report on Form 10-K for the year ended Dec.
31, 2017 and will be reimbursed for certain expenses including
those incurred in attending Board and committee meetings.
About Southcross Energy Partners
Southcross Energy Partners, L.P. --
http://www.southcrossenergy.com/-- is a master limited partnership
that provides natural gas gathering, processing, treating,
compression and transportation services and NGL fractionation and
transportation services. It also sources, purchases, transports
and sells natural gas and NGL. Its assets are located in South
Texas, Mississippi and Alabama and include two gas processing
plants, one fractionation plant and approximately 3,100 miles of
pipeline. The South Texas assets are located in or near the Eagle
Ford shale region. Southcross is headquartered in Dallas, Texas.
Southcross Energy reported a net loss attributable to partners of
$67.65 million on $665.9 million of total revenues for the year
ended Dec. 31, 2017, compared to a net loss attributable to
partners of $94.99 million on $548.72 million of total revenues for
the year ended Dec. 31, 2016. As of Dec. 31, 2017, Southcross
Energy had $1.10 billion in total assets, $604.6 million in total
liabilities and $499.6 million in total partners' capital.
* * *
In February 2017, S&P Global Ratings said that it affirmed its
'CCC+' corporate credit and senior secured issue-level ratings on
Southcross Energy Partners L.P. The outlook is stable. The rating
action reflects S&P's view that the recent credit agreement
amendment limits the likelihood of a default in the next two years
as the partnership will have an improved liquidity position and
need no longer adhere to its leverage covenants.
In January 2016, that Moody's Investors Service downgraded
Southcross Energy's Corporate Family Rating to 'Caa1' from 'B2'.
SOUZA PROPERTIES: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Souza Properties, Inc.
fka Souza's Furniture, Appliances, and TV, Inc.
P.O. Box 1943
Turlock, CA 95381
Business Description: Souza Properties, Inc. is a privately
held company in the apartment building
operators industry. Its principal assets
are located at 199 W. Canal Drive and
826-828 N. Golden State Blvd. Turlock,
CA 95380.
Chapter 11 Petition Date: March 8, 2018
Case No.: 18-90149
Court: United States Bankruptcy Court
Eastern District of California (Modesto)
Judge: Hon. Ronald H. Sargis
Debtor's Counsel: David C. Johnston, Esq.
DAVID C. JOHNSTON
1600 G Street, Suite 102
Modesto, CA 95354
Tel: 209-579-1150
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Lawrence J. Souza, president.
The Debtor did not incorporate a list of its 20 largest unsecured
creditors to its petition.
A full-text copy of the petition is available for free at:
https://www.scribd.com/document/373383811/caeb18-90149
SPINLABEL TECHNOLOGIES: Plan Filing Deadline Moved to April 6
-------------------------------------------------------------
Judge Erik P. Kimball of the U.S. Bankruptcy Court for the Southern
District of Florida has extended, at the behest of SpinLabel
Technologies, Inc., the exclusive periods to file a plan of
reorganization through and including April 6, 2018, and to solicit
acceptances for a plan of reorganization is extended to through and
including June 5, 2018.
The Procedures Order Deadline set forth in the Order Shortening
Time for Filing Proofs of Claim, Establishing Plan and Disclosure
Statement Filing Deadlines, and Addressing Related Matters is also
extended to through and including April 6, 2018.
As reported by the Troubled Company Reporter on Feb. 8, 2018, the
Debtor sought an extension of the Procedures Deadline Order,
Exclusive Filing Period and Exclusive Solicitation Period for a
period of 60 days in order to obtain exit financing, and to
finalize its disclosure statement and plan of reorganization.
The Debtor claimed that its management has devoted significant time
to complying with the requirements of operating as a
debtor-in-possession during a Chapter 11 case, pursuing various
business opportunities, obtaining debtor-in-possession financing,
and obtaining entry of the DIP Order. The Debtor has been able to
secure debtor-in-possession financing in the total amount of
$250,000, and the Court entered the DIP Order on January 11, 2018.
After the entry of the DIP Order, the Debtor has been seeking exit
financing, and preparing its disclosure statement and plan of
reorganization. However, as of February 2, 2018, the Debtor has not
obtained the exit financing it seeks to emerge bankruptcy and
operate post-confirmation.
About SpinLabel Technologies
SpinLabel Technologies, Inc. -- http://www.spinlabels.com/-- is a
Florida-based company dedicated to building and licensing its
unique labeling technology that builds brand value by engaging
current and prospective customers in the shopping corridor and at
home.
SpinLabel's proprietary, patented label Technology enables a
spinning label (an outer Label over an inner label) to almost
double the valuable messaging space on a container. SpinLabel is
aligned with top label manufacturers globally to facilitate easy
integration into most types of existing consumer product
packaging.
Based in Miami, Florida, SpinLabel -- which does business as
Spinformation, Inc., as Accudial Pharmaceutical, Inc., and as
Accudial, Inc. -- filed a Chapter 11 petition (Bankr. S.D. Fla.
Case No. 17-20123) on Aug. 9, 2017. In the petition signed by Alan
Shugarman, its director, the Debtor estimated $1 million to $10
million in both assets and liabilities. Bradley S. Shraiberg,
Esq., at Shraiberg Landaue & Page PA, serves as the Debtors'
bankruptcy counsel.
SPRINGLEAF FINANCE: Fitch to Rate $500MM Sr. Unsecured Notes B(EXP)
-------------------------------------------------------------------
Fitch Ratings expects to assign a rating of 'B(EXP)'/'RR4' to
Springleaf Finance Corporation's $500 million senior unsecured
notes due March 2025. Springleaf is a wholly owned subsidiary of
OneMain Holdings, Inc., which has a Long-Term Issuer Default Rating
(IDR) of 'B' with a Positive Rating Outlook.
KEY RATING DRIVERS
The expected unsecured debt rating is equalized with Springleaf's
Long-Term IDR as well as its existing unsecured debt, as the new
notes will rank equally in the capital structure.
The proposed note issuance does not affect Springleaf's Long-Term
IDR, as overall liquidity and leverage are not expected to change
materially. Based on the priority of repayment, the expected
unsecured rating of 'B'/'RR4' implies an average recovery for
unsecured debtholders under a stressed scenario.
Springleaf intends to use the proceeds from the offering for
general corporate purposes and toward the repayment or repurchase
of existing unsecured debt, which could include a partial
redemption of the $800 million, 7.25% OneMain Financial Holdings,
Inc. (OMFH) bonds that mature in 2021.
The OMFH bonds contain restrictive covenants that require them to
be redeemed at a previously set premium depending on the year they
are redeemed, which in this case would result in a premium to par
of 3.625% if they are redeemed prior to December 2018, with a
stepdown to 1.813% at that point. Once the bonds are redeemed,
OneMain would be able to consolidate its two operating subsidiaries
that have existed since the closing of the OneMain/Springleaf
merger. This would reduce the company's operating complexity and
improve financial flexibility, which Fitch would view favorably.
RATING SENSITIVITIES
The unsecured debt rating is primarily linked to changes in
OneMain's Long-Term IDR but is also sensitive to changes in
recovery prospects for the debt class.
OneMain's ratings could be upgraded if consolidated leverage is
brought down to the company's targeted level of 5x-7x, liquidity
and unsecured debt coverage levels remain appropriately managed,
and credit performance remains within Fitch expectations. In
addition, upward rating momentum would benefit from a proportionate
reduction in capital held at its insurance subsidiaries and the
absence of developments in the regulatory landscape that
significantly impact OneMain's core businesses.
Conversely, negative ratings momentum could be driven by an
inability to access the capital markets at a reasonable cost,
greater competitive intensity in the nonprime lending segment,
substantial credit quality deterioration, a significant increase in
asset encumbrance, potential new and more onerous rules and
regulations, as well as potential shareholder-friendly actions such
as initiating shareholder distributions that are inconsistent with
the company's long-term leverage and liquidity targets.
An inability to further deleverage the balance sheet could also
result in the Outlook being revised to Stable from Positive.
Fitch has assigned the following expected rating:
Springleaf Finance Corporation
-- Unsecured debt 'B(EXP)'/'RR4'.
Fitch currently rates OneMain and its subsidiaries:
OneMain Holdings, Inc.
-- Long-Term IDR 'B'.
Springleaf Finance Corp.
-- Long-Term IDR 'B';
-- Senior unsecured debt 'B/RR4';
OneMain Financial Holdings Inc.
-- Long-Term IDR 'B';
-- Senior unsecured debt 'B+/RR3'.
AGFC Capital Trust I
-- Trust preferred securities 'CCC'/'RR6'; Rating Watch Positive.
The Rating Outlook is Positive.
TEXDOM INVESTMENTS: Wants Insurance Financing Pact With IPFS
------------------------------------------------------------
Texdom Investments, LLC, asks for permission from the U.S.
Bankruptcy Court for the Southern District of Texas to enter into
insurance premium financing agreement with IPFS Corporation.
In the ordinary course of its business, the Debtor must maintain an
insurance policy. The Debtor is, however, unable to pay the full
premium of $17,994.76 in one lump sum in the ordinary course of
business and has been unable, after reasonable efforts, to obtain
unsecured credit for payment pursuant to 11 U.S.C. Section 364(b).
The Debtor has used the proposed insurance premium financing
company in its business in the past, and has determined that IPFS
offers the most advantageous terms for financing.
The insurance policy identified in the Agreement is crucial to the
operation of the Debtor's business and is required by the Debtor's
secured lender to protect its collateral.
The Agreement would require the Debtor to make a down payment to
IPFS in the amount of $4,808, and to make monthly payments in the
amount of $1,368.74 each over a term of 10 months. The annual
percentage rate is 8.200% and "Amount Financed" under the Agreement
is $13,186.76.
The Agreement grants IPFS a lien and security interest in all
right, title and interest to the scheduled policies, including (but
only to the extent permitted by applicable law):
(a) all money that is or may be due insured because of a loss
under any policy that reduces the unearned premiums
(subject to the interest of any applicable mortgagee or
loss payee);
(b) any unearned premium under each such policy;
(c) dividends which may become due insured in
connection with any policy; and
(d) interests arising under a state guarantee fund.
The Debtor requests for court authorization to grant IPFS's lien
and security interest in the premiums and dividends.
The Agreement also grants to IPFS a first priority security
interest in any loss payments under the policy which reduce the
unearned premiums.
In the event of a default by the Debtor in making the monthly
payments under the Agreement, but subject to a 10-day notice and
cure period, the Agreement allows IPFS to cancel the insurance
policies identified in the Agreement and apply to the Debtor's
account the unearned or return premiums and dividends and, subject
to the rights of mortgagees or other loss payees, any loss payments
which reduce the unearned premiums. The Debtor requests that IPFS
may exercise its rights under the Agreement in the event of default
without moving for relief from the automatic stay of 11 U.S.C.
Section 362 and without further order of the Court.
The Debtor's motion sets forth the premium finance down payment
required ($4,808) and the specific line items from the current and
prior cash collateral budgets that provide the necessary budget
unused line items and current line items to be reduced to
accommodate the premium down payment amount of $4,808.
The Debtor projects revenue during the current cash collateral
period of at least $4,808, for example sufficient revenues to pay
the premium finance down payment.
Debtor respectfully requests expedited relief as its current
insurance policy will expire on March 9, 2018. The consequences to
the estate of not obtaining expedited relief is cancellation of
necessary insurance on the apartment assets of the Debtor.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/txsb17-70485-47.pdf
About Texdom Investments
Founded in 2013, Texdom Investments, LLC, owns apartment properties
in McAllen, Texas, valued by the company at $4.6 million. Texdom
Investments filed a Chapter 11 petition (Bankr. S.D. Tex. Case No.
17-70485) on Dec. 14, 2017. In the petition signed by Ramon I.
Rodriguez, manager, the Debtor disclosed $4.62 million in total
assets and $4.42 million in total liabilities. The case is
assigned to Judge Eduardo V. Rodriguez. Kurt Stephen, Esq., at the
Law Office of Kurt Stephen, PLLC, serves as the Debtor's bankruptcy
counsel.
TITAN ENERGY: GSO/Blackstone Have 17.9% Stake as of Feb. 26
-----------------------------------------------------------
In a Schedule 13D/A filed with the Securities and Exchange
Commission, these entities reported beneficial ownership of common
shares, representing limited liability company interests, of Titan
Energy, LLC as of Feb. 26, 2018:
Shares Percentage
Beneficially of
Reporting Persons Owned Shares
----------------- ------------ ----------
Blackstone / GSO Strategic
Credit Fund 29,318 0.54%
GSO Energy Market Opportunities
Fund LP 116,545 2.14%
GSO / Blackstone Debt Funds
Management LLC 29,318 0.54%
GSO Energy Market Opportunities
Associates LLC 116,545 2.14%
GSO Capital Partners LP 29,318 0.54%
GSO Holdings I L.L.C. 116,545 2.14%
GSO Advisor Holdings L.L.C. 29,318 0.54%
Blackstone Holdings I L.P. 29,318 0.54%
Blackstone Holdings II L.P. 116,545 2.14%
Blackstone Holdings I/II GP Inc. 145,863 2.68%
The Blackstone Group L.P. 145,863 2.68%
Blackstone Group Management L.L.C. 145,863 2.68%
Bennett J. Goodman 145,863 2.68%
J. Albert Smith III 145,863 2.68%
Stephen A. Schwarzman 145,863 2.68%
FS Energy and Power Fund 555,496 10.20%
Foxfields Funding LLC 87,000 1.60%
FS Investment Corporation II 200,040 3.67%
Cobbs Creek LLC 66,040 1.21%
FS Investment Corporation III 72,739 1.34%
FS Investment Advisor, LLC 555,496 10.20%
FSIC II Advisor, LLC 200,040 3.67%
FSIC III Advisor, LLC 72,739 1.34%
Michael C. Forman 828,275 15.21%
Sean Coleman 828,275 15.21%
Gerald F. Stahlecker 0 0%
Zachary Klehr 0 0%
Brian Gerson 828,275 15.21%
Michael Kelly 828,275 15.21%
This amend constitutes an "exit filing" with respect to Gerald F.
Stahlecker, and Zachary Klehr. Messrs. Stahlecker and Klehr
resigned from the investment committees of each of FS Investment
Advisor, LLC, FSIC II Advisor, LLC and FSIC III Advisor, LLC.
Accordingly, they no longer may be deemed to have shared voting,
investment and/or dispositive power with respect to Common Shares
held by the FS Funds.
The Reporting Persons may be deemed to be the beneficial owners of
an aggregate of 974,138 Common Shares, representing 17.89% of the
outstanding Common Shares. The percentage is based on 5,444,794
Common Shares outstanding as of Nov. 27, 2017, as reported by the
quarterly report on Form 10-Q, filed by Titan Energy, LLC on Nov.
28, 2017.
A full-text copy of the regulatory filing is available at:
https://is.gd/6Q4A7X
About Titan Energy
Pittsburgh, Pennsylvania-based Titan Energy, LLC is an independent
developer and producer of natural gas, crude oil and NGLs, with
operations in basins across the United States with a focus on the
horizontal development of resource potential from the Eagle Ford
Shale in South Texas. The Company is a sponsor and manager of
Drilling Partnerships in which the Company co-invest, to finance a
portion of its natural gas, crude oil and natural gas liquids
production activities. Titan Energy is the Successor to the
business and operations of ARP, a Delaware limited partnership
organized in 2012.
For the period from Sept. 1 through Dec. 31, 2016, Titan Energy
reported a net loss of $33.31 million. For the period from Jan. 1,
2016, through Aug. 31, 2016, the Company reported a net loss of
$177.43 million. As of Sept. 30, 2017, Titan Energy had $605.4
million in total assets, $605.5 million in total liabilities and a
$61,000 total members' deficit.
Grant Thornton LLP, in Cleveland, Ohio, issued a "going concern"
qualification in its report on the consolidated financial
statements for the year ended Dec. 31, 2016, citing that as of Dec.
31, 2016 the Company was not in compliance with certain debt
covenants under its credit facilities. The Company does not have
sufficient liquidity to repay all of its current debt obligations.
The Company's business plan for 2017 contemplates asset sales,
obtaining additional working capital, and the refinancing or
restructuring of its credit agreements to long-term arrangements,
or other modifications to its capital structure. The Company's
ability to achieve the foregoing elements of its business plan,
which may be necessary to permit the realization of assets and
satisfaction of liabilities in the ordinary course of business, is
uncertain and raises substantial doubt about its ability to
continue as a going concern, the auditors said.
TOPS HOLDING: U.S. Trustee Forms Seven-Member Committee
-------------------------------------------------------
William K. Harrington, the U.S. Trustee for Region 2, on March 6
appointed seven creditors to serve on the official committee of
unsecured creditors in the Chapter 11 case of Tops Holding II
Corporation and its debtor-affiliates.
The committee members are:
(1) PepsiCo, Inc.
Attn: Michael Bevilacqua, Senior Director of Credit
1100 Reynolds Boulevard
Winston-Salem, North Carolina 27105
Tel: (336) 896-5577
(2) Valassis Direct Mail, Inc.
Attn: Hal Manoian, CPA
One Targeting Centre
Windsor, Connecticut 06095
Tel: (860) 285-6336
(3) Osterweis Strategic Income Fund
Attn: Bradley Kane, Portfolio Manager
1 Maritime Plaza – Suite 800
San Francisco, California 94111
Tel: (415) 434-4441
(4) U.S. Bank N.A.
Corporate Trust Services
EX-MA-FED
One Federal Street – 3rd Floor
Boston, Massachusetts 02110
Attn: Laura L. Moran, Vice President
Tel: (617) 603-6429
(5) UFCW Local One Pension Fund
Attn: Michael Ciancaglini, Fund Administrative Director
5911 Airport Road
Oriskany, New York 13424
Tel: (315) 797-9600 Ext. 2253
(6) International Brotherhood of Teamsters Local 264
Attn: Iain D. Gold, Director
25 Louisiana Avenue, N.W.
Washington, D.C. 20001
Tel: (202) 624-6800
(7) Benderson Development Company, LLC
Attn: Mark L. Chait, Executive Director of Leasing
570 Delaware Avenue
Buffalo, New York 14202
Tel: (716) 886-0211
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.
Tops Holding II Corporation and its affiliates filed for Chapter 11
bankruptcy protection (Bankr. S.D.N.Y. Case No. 18-22279).
TOYS "R" US: Reportedly Prepping Shutdown of U.S. Stores
--------------------------------------------------------
Toys "R" Us, Inc., is reportedly making preparations for a
liquidation of its U.S. operations absent a buyer or a deal with
its lenders.
Bloomberg News, citing people familiar with the matter, reported
that while the situation is still fluid, a shutdown of the U.S.
division has become increasingly likely in recent days.
Reuters, also citing an unnamed source, said that negotiations with
creditors are continuing and no decision has yet been taken. The
company is also considering other options, including a potential
sale in bankruptcy if possible, Reuters reported.
Toys "R" Us was hoping that strong sales during the key holiday
season would boost its chances of clinching a deal with its
creditors in bankruptcy. The company is expected to report
three-month earnings to the end of January later this month.
A shutdown by Toys "R" Us is expected to affect Hasbro, Mattel and
other toymakers.
"Without a dedicated toy retailer -- 365 days a year -- you will
see growth in the industry slow," Gerrick Johnson, an analyst for
BMO Capital Markets, said, according to Bloomberg. "Toys 'R' Us is
where new products can be discovered and blossom. It's also where
smaller toy companies can have an opportunity."
The toy industry rose just 1% in 2017 and fell during the holiday
season, according to research firm NPD Group.
About Toys "R" Us
Toys "R" Us, Inc., is an American toy and juvenile-products
retailer founded in 1948 and headquartered in Wayne, New Jersey, in
the New York City metropolitan area. Merchandise is sold in 880
Toys "R" Us and Babies "R" Us stores in the United States, Puerto
Rico and Guam, and in more than 780 international stores and more
than 245 licensed stores in 37 countries and jurisdictions.
Merchandise is also sold at e-commerce sites including Toysrus.com
and Babiesrus.com.
On July 21, 2005, a consortium of Bain Capital Partners LLC,
Kohlberg Kravis Roberts and Vornado Realty Trust invested $1.3
billion to complete a $6.6 billion leveraged buyout of the
company.
Toys "R" Us is a privately owned entity but still files with the
Securities and Exchange Commission as required by its debt
agreements.
The Company's consolidated balance sheet showed $6.572 billion in
assets, $7.891 billion in liabilities, and a stockholders' deficit
of $1.319 billion as of April 29, 2017.
Toys "R" Us, Inc., and certain of its U.S. subsidiaries and its
Canadian subsidiary voluntarily filed for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. Case No.
17-34665) on Sept. 19, 2017. In addition, the Company's Canadian
subsidiary voluntarily commenced parallel proceedings under the
Companies' Creditors Arrangement Act ("CCAA") in Canada in the
Ontario Superior Court of Justice. The Company's operations
outside of the U.S. and Canada, including its 255 licensed stores
and joint venture partnership in Asia, which are separate entities,
are not part of the Chapter 11 filing and CCAA proceedings.
Grant Thornton is the monitor appointed in the CCAA case.
Judge Keith L. Phillips presides over the Chapter 11 cases.
In the Chapter 11 cases, Kirkland & Ellis LLP and Kirkland & Ellis
International LLP serve as the Debtors' legal counsel. Kutak Rock
LLP serves as co-counsel. Toys "R" Us employed Alvarez & Marsal
North America, LLC as its restructuring advisor; and Lazard Freres
& Co. LLC as its investment banker. It hired Prime Clerk LLC as
claims and noticing agent. A&G Realty Partners, LLC, serves as its
real estate advisor.
On Sept. 26, 2017, the U.S. Trustee for Region 4 appointed an
official committee of unsecured creditors. The Committee retained
Kramer Levin Naftalis & Frankel LLP as its legal counsel; Wolcott
Rivers, P.C. as local counsel; FTI Consulting, Inc. as financial
advisor; and Moelis & Company LLC as investment banker.
TRIAD WELL: U.S. Trustee Unable to Appoint Committee
----------------------------------------------------
The Office of the U.S. Trustee on March 6 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of Triad Well Service, LLC.
Triad Well Service is a service supplier that administers both
support and products to the oil and gas industry. The company
provides its customers with products and services that will enhance
well production, and prevent common ongoing and future
complications. Located in Houston, Texas, Triad has a worldwide
outlook and can arrange for the global shipping and servicing of
its products. Recently, the company's main focus has been
servicing the Eagle Ford basin with a predominant emphasis in
paraffin control.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr. S.D.
Tex. Case No. 18-30150) on Jan. 15, 2018, estimating its assets and
liabilities at between $1 million and $10 million each. The
petition was signed by Michael T. Kramer, president.
Judge Jeff Bohm presides over the case.
Richard L. Fuqua, II, Esq., at Fuqua & Associates, P.C., serves as
the Debtor's bankruptcy counsel.
TWO RIVERS: Making Progress on its Hemp Crop Share Arrangement
--------------------------------------------------------------
Two Rivers Water & Farming Company said it is making significant
progress on its hemp crop share arrangement and water redevelopment
project. Land development sales are progressing ahead of plan.
Two Rivers currently values its water and associated land assets at
the prior appraised value of approximately $31 million. Two Rivers
believes that with a projected increase in demand for high quality
CBD oil and water demand in the next few years, valuation and
revenue opportunities of its water assets and hemp activities will
also significantly increase.
Hemp
Two Rivers' hemp crop share arrangement is with a southern Colorado
hemp grower. This group selected Two Rivers due to its senior
water rights and productive farmland located between Walsenburg and
Colorado City in southeastern Colorado. According to the grower,
the hemp grown will be non-psychoactive and have less than .3% THC
content and a high percentage of CBD oil. All permitting from the
State of Colorado and the local county has been completed. The
land will be prepped in March with planting beginning near the end
of May after the last frost of the season. The grower is in talks
with an additional experienced grower that intends to grow up to an
additional 20 acres at the same location in 2018 if agreement can
be reached on the crop share.
Two Rivers and the grower believe that hemp production for CBD oil
is a significant opportunity for Colorado agriculture. Hemp is a
great benefit to users worldwide for pain relief, seizures,
anxiety, sleep disorders, and many other medicinal applications
that are currently under study. Also hemp fiber from other strains
can be used in fabric, particle board, concrete, paper, clothing
and numerous other applications all of which can be produced using
over 1,000 acres of Two Rivers' land and water assets using this
same crop sharing model.
The hemp grower projection shows a CBD yield representing $125,000
per acre with a net of $84,000 per acre. This will yield $20,000
per acre as Two Rivers' crop share. The Butte Valley Farm has more
than 200 acres with associated senior water rights. If all 200
acres are committed to crop share under the current agreement,
projected revenue to Two Rivers may be $4,000,000. These
projections could further be amplified with the addition of an
extraction facility, which is currently not in place.
Water
Two Rivers Waters' core focus is its water assets. As a result,
work continues toward the monetization of its water assets. The
development of its water assets will continue to be time and
capital intensive. Therefore, it is important that water and land
assets assist in current operational requirements, thus the reason
for our hemp endeavors above and land sales.
Two Rivers, through its subsidiary, Water Redevelopment Company,
continues to work with a real estate developer to provide
residential and commercial water in the area where Water Redev
currently has agriculture use water. The water supply agreement
between Two Rivers and the developer has recently been expanded
from a potential of 10,000 taps over the next 20 years to 19,400
taps; 14,400 taps projected over 40 years are for lot owners in
Colorado City Colorado, and 5,000 taps to Crown Valley Ranch, LLC,
which is a 4,000 acres 2016 master plan approved by the Huerfano
County Commissioners. The supply agreement calls for a payment of
$6,500 per tap in revenue to Two Rivers. Once final engineering is
completed, it is estimated that one-acre foot of water will supply
three taps. Water Redev with the assistance of the real estate
developer will need to change water use from agriculture to
municipal use.
Starting last year, Water Redev began to market its water to other
end users on a lease basis, creating $7,000 in revenue. This year,
the Company has amplified these efforts. It will annually lease
agricultural water from the Huerfano Lake (located in Pueblo
County, Colorado) from $1,000 per acre-foot delivered via its ditch
system to $22,800 per acre-foot ($0.07/gallon) delivered by truck.
Two Rivers and Water Redev are in the process of bringing its
largest dam, the Cucharas Reservoir #5, into compliance with State
of Colorado zero fill requirement. Two Rivers took a major step in
the cleaning out the obstructions to the outlet gate and draining
the Cucharas Reservoir as required by the State of Colorado. The
next steps include the construction of a new dam. Once completed,
the new dam will manage water in the Cucharas and Huerfano river
basin. Two Rivers plans to work closely with the State of
Colorado. This reservoir when at full capacity can account for
nearly 10% of the current State's goal of an additional 400,000
acre-feet of water storage by 2050. (2015 Colorado's Water Plan --
Executive Summary -- Measurable Objectives.
https://www.colorado.gov/pacific/cowaterplan/plan).
Land Sales
For the year ended Dec. 31, 2016, Two Rivers owned 2,584 acres in
eastern El Paso County, east of Colorado Springs Colorado, close to
Schriever Air Force Base. This land was acquired to control a
water metropolitan district. Beginning last year, Two Rivers
developed eight, 40-acre subdivided lots for sale. To date, all
eight lots have been sold for a gross sales price of $420,000
represented by approximately 320 acres, or $1,300 per acre. Two
Rivers' cost basis for this land sold is $607 per acre. Seventy
five percent of the net funds, or $285,000, were used to pay down
the first lien debt. Two Rivers plan to make an additional 12 to
18 lots available for sale is 2018, subject to surveying and well
permits.
About Water Redevelopment Company
Water Redevelopment Company is a subsidiary of Two Rivers and
focuses on development and redevelopment of infrastructure for
water management and delivery. Water is one of the most basic,
core assets. Water Redevelopment's first area of focus is in the
Huerfano-Cucharas river basin in southeastern Colorado.
About Two Rivers
Based in Denver, Colorado, Two Rivers —
http://www.2riverswater.com/— assembles its water assets by
acquiring land with senior water rights. Two Rivers focuses on
development and redevelopment of infrastructure for water
management and delivery. Two Rivers' first area of focus is in the
Huerfano-Cucharas river basin in southeastern Colorado. Two
Rivers' long-term strategy focuses on the value of its water assets
and how to monetize water for the benefit of its stakeholders,
including communities near where its water assets are located.
The Company has not generated significant revenues and has incurred
net losses (including significant non-cash expenses) of
approximately $10.70 million and $6.15 million during the years
ended Dec. 31, 2016 and 2015, respectively. At Sept. 30, 2017, the
Company has a working capital deficit and a stockholders' deficit
of approximately $19.37 million and $87.39 million, respectively.
The HCIC seller carry back debt is in technical default. These
factors, the Company said, raise substantial doubt about its
ability to continue as a going concern.
"We currently expect that our cash expenditures will remain
constant for the foreseeable future, as we complete our second
greenhouse, and seek to monetize our water assets. As a result,
our existing cash, cash equivalents and other working capital may
not be sufficient to meet all projected cash needs contemplated by
our business strategies for the remainder of 2017 and for 2018.
To the extent our cash, cash equivalents and other working capital
are insufficient to fund our planned activities, we may need to
either slow our growth initiatives or raise additional funds
through public or private equity or debt financings. We also may
need to raise additional funds in the event we determine in the
future to affect one or more acquisitions of businesses,
technologies and products. If additional funding is required, we
cannot assure that we will be able to affect an equity or debt
financing on terms acceptable to us or at all," the Company stated
in its quarterly report for the period ended Sept. 30, 2017.
US OIL: US Court Recognizes Canadaian Ruling Granting Financing
---------------------------------------------------------------
The Hon. R. Kimball Mosier of the U.S. Bankruptcy Court for the
District of Utah has entered an order granting comity of the court
order entered by the Canadian court on US Oil Sands Inc.'s
requested financing and that it is recognized and given full force
and effect in the U.S. with regard to the additional financing
requested.
Pursuant to the Receivership Order, the Chapter 15 Debtors were
authorized to obtain up to $1 million in secured financing.
On Feb. 1, 2018, the Receiver filed its First Report of FTI
Consulting Canada Inc., in its capacity as court-appointed receiver
and manager of US Oil Sands Inc. and US Oil Sands (Utah) Inc. with
the Canadian Court pursuant to which the Receiver stated that it
had determined that it is in the best interests of the Chapter 15
Debtors to obtain authorization to borrow, as necessary, an
additional $500,000 in secured debt (for a total authorization of
$1.5 million) from USO.
Also on Feb. 1, 2018, the Receiver filed a motion in the Canadian
Proceeding requesting, among other things, an order from the
Canadian Court authorizing the Receiver to obtain the Additional
Financing.
The Chapter 15 Debtors are authorized to use their assets located
in the territorial jurisdiction of the U.S. as collateral under the
Additional Financing on the terms set forth in the Canadian
financing motion.
The Receiver is authorized to take any and all actions it deems
necessary or appropriate to effectuate the Additional Financing,
insofar as such relate to or involve the Chapter 15 Debtors or the
assets of the Chapter 15 Debtors that are located in the
territorial jurisdiction of the U.S.
USO is granted a fully perfected and first-priority, priming lien
and security interest under 11 U.S.C. Section 364(d) in all assets
of the Chapter 15 Debtors located in the territorial jurisdiction
of the United States; provided, however, all ad valorem tax liens
currently held by any applicable taxing authorities shall neither
be primed by nor subordinated to any liens granted herein.
Notwithstanding anything in this court order to the contrary, the
liens granted pursuant to this court order will not and do not
apply to and are not granted with respect to that certain 2014 Ford
truck, VIN 1FTFW1ET8EKF24624, owned by the Chapter 15 Debtors,
which Truck is the subject of a first-priority lien held by ZB,
N.A., dba Zions First National Bank.
This court order will be immediately effective and enforceable upon
its entry to avoid immediate and irreparable harm to the Chapter 15
Debtors. This court order constitutes a final and appealable order
within the meaning of 28 U.S.C. Section 158(a).
A copy of the U.S. Court Order is available at:
http://bankrupt.com/misc/utb17-29716-28.pdf
About US Oil Sands
Calgary, Alberta-based US Oil Sands Inc. --
http://www.usoilsandsinc.com/-- is engaged in the exploration and
development of oil sands properties and, through its wholly owned
United States subsidiary US Oil Sands (Utah) Inc., has 100%
interest in bitumen leases covering 32,005 acres of land in Utah's
Uinta Basin. The Company has developed a proprietary extraction
process which uses a bio-solvent to extract bitumen from oil sands
without the need for tailings ponds.
In September 2017, the Court of Queen's Bench of Alberta has
granted the application of the Company's lender, ACMO S.a R.L., to
appoint FTI Consulting Canada Inc. as receiver and manager over the
assets, undertakings and property of US Oil Sands. The Receiver is
charged with managing the day-to-day affairs of the Company during
the period of its appointment and should be contacted with respect
to any questions concerning the assets and liabilities of US Oil
Sands.
The receiver filed Chapter 15 petitions for US Oil Sands Inc. and
affiliate US Oil Sands (Utah) Inc. on Nov. 7, 2017 (Bankr. Utah
Case No. 17-29716 and 17-29717) to seek recognition of the
proceedings in Canada. The foreign main proceeding is ACMO
S.A.R.L. v. US Oil Sands Inc. and US Oil Sands (Utah) Inc., Court
of Queen's Bench Alberta, Court File No. 1701-12253.
FTI Consulting Canada Inc., the receiver, is the Debtors'
authorized representative in the Chapter 15 cases. Bruce H. White,
Esq., at Parsons Behle & Latimer, is the U.S. counsel.
VICI PROPERTIES: S&P Raises CCR to 'BB' on Improved Leverage
------------------------------------------------------------
S&P Global Ratings raised its corporate credit rating on Las
Vegas-based VICI Properties Inc. to 'BB' from 'BB-'. The outlook is
stable.
S&P said, "At the same time, we raised our issue-level ratings on
VICI's secured debt to 'BBB-' from 'BB+'. The recovery rating on
this debt remains '1', indicating our expectation for very high
(90%-100%; rounded estimate: 95%) recovery for lenders in the event
of a payment default.
"We also raised our issue rating on VICI's second lien notes to
'BB' from 'B' and revised the recovery rating to '4' from '6'. The
'4' recovery rating indicates our expectation for average (30%-50%;
rounded estimate: 30%) recovery for lenders in the event of a
payment default. The improved recovery prospects for second-lien
noteholders results from the use of IPO proceeds to repay debt,
increasing value available for second-lien noteholders and
improving recovery prospects to the 30% to 50% range.
"At the same time, we removed all ratings from "under criteria
observation" (UCO), where they were placed on Feb. 26, 2018,
following the publication of our revised criteria for rating global
real estate companies, "Key Credit Factors For The Real Estate
Industry," published Feb. 26, 2018.
"The upgrade reflects our view that VICI's recent IPO has
meaningfully reduced financial risk as the company used a portion
of the IPO proceeds to repay nearly $700 million in debt. As a
result, we now expect leverage to be more than 1x better compared
to our prior forecast. We forecast leverage will be in the mid- to
high-5x area through 2019, compared to the high-6x area in our
prior base case forecast. In our base-case leverage measure, we are
incorporating an expectation that remaining IPO proceeds will be
used to fund acquisitions at a multiple similar to the company's
recent Harrah's Las Vegas transaction (13x). Although the company
has not yet identified specific acquisitions, we believe growing
its portfolio of properties will be a strategic focus going forward
and VICI does have a call right to purchase certain assets from
Caesars, although those acquisitions would be at a modestly lower
multiple (10x rent) than we are incorporating into our forecast.
"The stable outlook reflects our expectation for minimal cash flow
volatility given the triple-net lease structure under which nearly
all of its cash flows are fixed. As a result, we expect VICI will
be able to sustain leverage under 6x through 2019, absent
acquisitions. We believe, however, that the company could
potentially increase leverage from current levels for future
acquisitions.
"We could lower the rating if we no longer expected VICI to sustain
leverage under 7.5x. Given the cushion we expect VICI to have with
respect to this threshold, this would most likely result from a
leveraging acquisition where VICI is unable or unwilling to raise a
sufficient amount of equity to keep leverage below this level
rather than operating performance given the stability and
predictability of the company's cash flow.
"Although we expect VICI's leverage will be under 6x over the next
few years, we are unlikely to raise the rating until VICI
demonstrates a track record of being able to access the equity
markets for future acquisitions and a willingness to finance future
acquisitions using sufficient equity proceeds, no matter the
condition of the equity markets, such that leverage would not
increase above 6x. Alternatively, we could also raise the rating if
VICI builds in sufficient cushion relative to this upgrade
threshold that we believe it could absorb large acquisitions
without going above 6x if equity markets are volatile."
VILLAGE VENTURE: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The Office of the U.S. Trustee on March 6 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of Village Venture Realty, Inc.,
About Village Venture Realty
Village Venture Realty, Inc., doing business as Village Ventures
Realty, Inc., and ERA Equity Group, is a privately held real estate
company based in Hot Springs Village, Arizona. Village Venture
lists and sells properties of other people and buys properties for
subdivisions, building out roads, utilities, and other
infrastructure. The company also entered into the business of
financing home sales in its subdivisions.
The Company previously sought bankruptcy protection on Feb. 8, 2016
(Bankr. W.D. Ark. Case No. 16-72187) and on Sept. 14, 2016 (Bankr.
W.D. Ark. Case No. 16-70284).
Village Venture again sought Chapter 11 protection (Bankr. W.D.
Ark. Case No. 17-73221) on Dec. 28, 2017. In the petition signed
by Gary Coleman, ites president, the Debtor estimated $1 million to
$10 million in both assets and liabilities. Jennifer M. Lancaster,
Esq., at Lancaster Law Firm, serves as bankruptcy counsel to the
Debtor. ABC Law Center is the co-counsel.
WALKING CO: March 20 Meeting Set to Form Creditors' Panel
---------------------------------------------------------
Andy Vara, Acting United States Trustee for Region 3, will hold an
organizational meeting on March 20, 2018, at 10:00 a.m. in the
bankruptcy cases of The Walking Company, Inc.
The meeting will be held at:
The Doubletree Hotel
700 King Street
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors pursuant
to Section 341 of the Bankruptcy Code. A representative of the
Debtor, however, may attend the Organizational Meeting, and provide
background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States Trustee
appoint a committee of unsecured creditors as soon as practicable.
The Committee ordinarily consists of the persons, willing to serve,
that hold the seven largest unsecured claims against the debtor of
the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee may
consult with the debtor, investigate the debtor and its business
operations and participate in the formulation of a plan of
reorganization. The Committee may also perform other services as
are in the interests of the unsecured creditors whom it
represents.
About The Walking Company
The Walking Company is the leading national specialty retailer of
high-quality, technically designed comfort footwear and
accessories, and offers a selection of premium comfort brands
including ABEO, Dansko, ECCO, Taos, and more. The Walking Company
operates 208 stores in premium malls across the nation and the
company's website http://www.thewalkingcompany.com/
On March 6, 2018, The Walking Company Holdings, Inc., along with
affiliates The Walking Company, Big Dog USA, Inc., and FootStmart,
Inc., filed voluntary petitions for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. D. Del. Lead Case No.
18-10474). The cases are pending joint administration before the
Honorable Laurie Selber Silverstein.
Pachulski Stang Ziehl & Jones LLP is the Debtors' counsel.
Consensus Advisory Services LLC is the financial advisor. Kurtzman
Carson Consultants LLC is the claims and noticing agent.
Choate, Hall & Stewart LLP, led by Kevin J. Simard, Esq., and
Womble Bond Dickinson, led by Matthew P. Ward, Esq., serve as
counsel to the DIP Agent, DIP Term Agent, the Prepetition Senior
Agent, and the Prepetition Term Agent.
Irell & Manella LLP, led by Jeffrey M. Reisner, Esq., is counsel to
the Prepetition Subordinated Creditors.
WEATHERFORD INTERNATIONAL: Closes Tender Offer for 9.625% Notes
---------------------------------------------------------------
Weatherford International plc disclosed the final results and
expiration of the previously announced offer by Weatherford
International Ltd., a Bermuda exempted company and indirect, wholly
owned subsidiary of the Company, to purchase for cash any and all
of its 9.625% senior notes due 2019.
The following is the final results of the Tender Offer according to
information received from D.F. King & Co., Inc., the Tender and
Information Agent, as of 5:00 p.m., New York City time, on
Feb. 27, 2018:
Title of Notes: 9.625% Senior Notes due 2019
Amount Outstanding: $485,196,000
Principal Amount Tendered: $425,102,000
Principal Amount Accepted: $425,102,000
Total Purchase Price: $454,434,038
The Company expects to accept for payment all those Notes validly
tendered and not validly withdrawn in the Tender Offer as of the
Expiration Time and expects to make payment for those Notes on Feb.
28, 2018, subject to the Company's successful completion of its
previously announced offering of senior notes that is also expected
to close on Feb. 28, 2018. The Company also expects to accept for
payment all Notes that remain subject to guaranteed delivery
procedures and to make payment for those Notes on March 2, 2018.
Deutsche Bank Securities Inc., Citigroup Global Markets Inc.,
Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, Wells Fargo
Securities, LLC, Skandinaviska Enskilda Banken AB (publ), TD
Securities (USA) LLC, RBC Capital Markets, LLC, Barclays Capital
Inc., Standard Chartered Bank and UniCredit Capital Markets LLC are
the dealer managers in the Tender Offer. D.F. King & Co., Inc. was
retained to serve as both the tender agent and the information
agent for the Tender Offer. Persons with questions regarding the
Tender Offer should contact Deutsche Bank Securities Inc. at
(toll-free): (855) 287-1922 or (collect): (212) 250-7527. Requests
for copies of the Offer to Purchase and other related materials
should be directed to D.F. King & Co., Inc. at (toll-free): (888)
541-9895 or by email to weatherford@dfking.com or via the following
web address: www.dfking.com/weatherford.
About Weatherford
Weatherford International plc (NYSE: WFT), an Irish public limited
company and Swiss tax resident -- http://www.weatherford.com/-- is
a multinational oilfield service company. Weatherford provides
equipment and services used in the drilling, evaluation,
completion, production and intervention of oil and natural gas
wells. The Company operates in over 90 countries and has a network
of approximately 800 locations, including manufacturing, service,
research and development, and training facilities and employs
approximately 29,200 people.
Weatherford reported a net loss attributable to the Company of
$2.81 billion in 2017, a net loss attributable to the Company of
$3.39 billion in 2016, and a net loss attributable to the Company
of $1.98 billion in 2015. As of Dec. 31, 2017, Weatherford had
$9.74 billion in total assets, $10.31 billion in total liabilities,
and a total shareholders' deficiency of $571 million.
* * *
As reported by the TCR on Nov. 20, 2017, Fitch Ratings affirmed
Weatherford and its subsidiaries' Long-Term Issuer Default Ratings
(IDR) and senior unsecured ratings at 'CCC'. WFT's 'CCC' rating
reflects exposure to the oilfield services sector and a stressed
balance sheet. Fitch expects an extended down-cycle and delayed
recovery from Fitch initial sector recovery expectations due to low
to range-bound oil and gas prices.
WEATHERFORD INTERNATIONAL: Completes $600 Million Notes Offering
----------------------------------------------------------------
Weatherford International, LLC, an indirect wholly owned subsidiary
of Weatherford International plc, has completed its offering of
$600 million aggregate principal amount of its 9.875% senior notes
due 2025. The Notes were issued in a private offering exempt from,
or not subject to, the registration requirements of the Securities
Act of 1933 to persons reasonably believed to be qualified
institutional buyers in accordance with Rule 144A under the
Securities Act and to non-U.S. persons outside of the United States
in accordance with Regulation S under the Securities Act.
Sixth Supplemental Indenture
The Notes were issued under an Indenture dated as of June 18, 2007,
among Weatherford Delaware (f/k/a Weatherford International, Inc.),
as issuer, Weatherford International Ltd., a Bermuda exempt company
and an indirect wholly owned subsidiary of Weatherford Ireland, as
guarantor, and Deutsche Bank Trust Company Americas, as trustee, as
supplemented by the Sixth Supplemental Indenture, dated as of Feb.
28, 2018, by and among Weatherford Delaware, as issuer, Weatherford
Ireland, as guarantor, Weatherford Bermuda, as guarantor, and the
Trustee.
The Notes will pay interest semi-annually in arrears on May 1 and
November 1 of each year, beginning on Nov. 1, 2018. The Notes will
mature on March 1, 2025. The Notes are fully and unconditionally
guaranteed, on a senior, unsecured basis, by Weatherford Ireland
and by Weatherford Bermuda.
Weatherford Delaware, at its option, may redeem the Notes in whole
or part, at any time or from time to time prior to Dec. 1, 2024, at
a redemption price equal to 100% of the principal amount of those
Notes to be redeemed, plus accrued and unpaid interest, if any, on
those Notes to, but excluding, the redemption date, plus a
make-whole premium. Additionally, commencing on Dec. 1, 2024, the
Company, at its option, may redeem the Notes in whole or part, at a
redemption price equal to 100% of the principal amount of the Notes
to be redeemed, plus accrued and unpaid interest, if any, on those
Notes to, but excluding, the redemption date.
If a "Change of Control Triggering Event" (as defined in the
Indenture) occurs, then holders may require Weatherford Delaware to
repurchase their Notes at a cash repurchase price equal to 101% of
the principal amount of the Notes to be repurchased, plus accrued
and unpaid interest, if any, to the repurchase date.
The Notes and the guarantees are senior, unsecured obligations of
Weatherford Delaware and the guarantors and are (1) equal in right
of payment with existing and future senior indebtedness of
Weatherford Delaware and the guarantors, as applicable; (2) senior
in right of payment to existing and future indebtedness of
Weatherford Delaware and the guarantors that is expressly
subordinated to the Notes and the guarantees, as applicable; and
(3) effectively subordinated to existing and future secured
indebtedness of Weatherford Delaware and the guarantors, as
applicable, to the extent of the value of the collateral securing
that indebtedness. Holders' rights to payment under the Notes and
the guarantees are also structurally subordinated to all existing
and future indebtedness and other liabilities, including trade
payables, and (to the extent Weatherford Delaware, Weatherford
Ireland or Weatherford Bermuda, as applicable, is not a holder
thereof) preferred equity, if any, of Weatherford Ireland's
subsidiaries, other than Weatherford Delaware and Weatherford
Bermuda.
Registration Rights Agreement
On Feb. 28, 2018, in connection with the closing of the Offering,
the Weatherford Parties entered into a Registration Rights
Agreement with Deutsche Bank Securities Inc., as representative of
the initial purchasers of the Notes. Under the Registration Rights
Agreement, the Weatherford Parties have agreed to use commercially
reasonable efforts to file and cause to become effective a
registration statement with respect to an offer to exchange the
Notes for substantially identical notes that are registered under
the Securities Act so as to permit the exchange offer to be
consummated no later than April 4, 2019. Under specified
circumstances, Weatherford Delaware and the guarantors have also
agreed to use commercially reasonable efforts to cause to become
effective a shelf registration statement relating to resales of the
Notes. Weatherford Delaware is required to pay additional interest
(initially 1.0%, which amount will increase annually) if it fails
to comply with the obligations to consummate the exchange offer or
to cause a shelf registration statement relating to resales of the
Notes to become effective within the time periods specified in the
Registration Rights Agreement.
About Weatherford
Weatherford International plc (NYSE: WFT), an Irish public limited
company and Swiss tax resident — http://www.weatherford.com/—
is a multinational oilfield service company. Weatherford provides
equipment and services used in the drilling, evaluation,
completion, production and intervention of oil and natural gas
wells. The Company operates in over 90 countries and has a network
of approximately 800 locations, including manufacturing, service,
research and development, and training facilities and employs
approximately 29,200 people.
Weatherford reported a net loss attributable to the Company of
$2.81 billion in 2017, a net loss attributable to the Company of
$3.39 billion in 2016, and a net loss attributable to the Company
of $1.98 billion in 2015. As of Dec. 31, 2017, Weatherford had
$9.74 billion in total assets, $10.31 billion in total liabilities
and a total shareholders' deficiency of $571 million.
* * *
As reported by the TCR on Nov. 20, 2017, Fitch Ratings affirmed
Weatherford and its subsidiaries' Long-Term Issuer Default Ratings
(IDR) and senior unsecured ratings at 'CCC'. WFT's 'CCC' rating
reflects exposure to the oilfield services sector and a stressed
balance sheet. Fitch expects an extended down-cycle and delayed
recovery from Fitch initial sector recovery expectations due to low
to range-bound oil and gas prices.
WELLS ENTERPRISES: S&P Assigns 'BB' Rating on New $175MM Term Loan
------------------------------------------------------------------
S&P Global Ratings assigned its 'BB' issue-level rating to Le Mars,
Iowa-based ice cream and frozen treat manufacturer Wells
Enterprises Inc. subsidiary WEI Sales LLC's proposed $175 million
first-lien term loan maturing in 2025. The recovery rating of '2'
indicates S&P's expectations for a substantial (70%-90%; rounded
estimate 75%) recovery in the event of payment default.
S&P's view of Wells' business continues to reflect its narrow
product focus in the slow-growing packaged and novelty ice cream
category, geographic and manufacturing concentration, and small
scale relative to larger diversified competitors. Despite its
product concentrations, the company's strategy is to further expand
market share within ice cream, possibly with M&A, while at the same
time investing to improve manufacturing execution and grow margins.
Therefore, product and manufacturing concentration will likely
remain key risk factors. The company has a highly concentrated
manufacturing footprint, with all production generated by two Le
Mars production plants, and its sales are moderately seasonal, with
over 60% of sales occurring from April through September.
ISSUE RATINGS--RECOVERY ANALYSIS
Security and Guarantee Package:
WEI Sales LLC is the borrower of the term loan while Wells
Enterprises Inc. guarantees the obligations under it. The
guarantors include all existing and future wholly owned domestic
subsidiaries of Wells Enterprises Inc. both direct and indirect.
The first-lien facility will be secured by a first-priority lien in
all tangible and intangible assets, except accounts receivable and
inventory pledged to the asset-backed lending (ABL) revolver, and a
second-priority lien on all ABL collateral.
Covenants:
Under the proposed financing, the first-lien term loan will be
covenant-lite.
Simulated Default Scenario:
S&P's simulated default scenario contemplates a combination of
increased competition from larger, more-established food
manufacturers; a major product recall; a significant manufacturing
disruption; a spike in commodity costs (most notably cream or
milk); or some combination of these. This results in lower sales
and operating margins, and the company has to fund cash flow
shortfalls with available cash and revolver borrowings. Eventually,
the company's liquidity and capital resources become strained to
the point where it cannot continue to operate without an equity
infusion or bankruptcy filing, and goes into default in 2020.
Valuation:
S&P said, "We have valued the company on a going-concern basis
using a 6x multiplier of our projected emergence EBITDA. The
multiple reflects the company's brand portfolio as well as leading
position in U.S. in U.S. private label ice cream production. The
'2' recovery rating on the senior secured term loan reflects our
expectation of a substantial (70%-90%: rounded estimate 75%)
recovery in the event of payment default."
Simplified Waterfall:
-- Simulated year of default: 2020
-- Emergence EBITDA/EBITDA multiple: $39.6 mil./6x
-- Net enterprise value after administrative expenses (5%): $225.5
mil.
-- Estimated priority claims: $89.2 mil.
-- Value available for senior secure claims: $136.3 mil.
-- Senior secured claims: $175.1 mil.
—Recovery expectations: 70%-90%; rounded estimate: 75%
Note: All debt amounts include six months of prepetition interest.
Calculation of emergence EBITDA:
-- Default EBITDA proxy (interest expense + amortization + minimum
capital expenditures): $36 mil. ($14 mil. + $1.75 mil. + $20.2
mil.)
-- Key assumptions (cyclicality (cycl.) adjustment
(adj.)/operational adj.): 0%/10%
-- Emergence EBITDA (default EBITDA proxy + cycl. adj. + operating
adj.): $39.6 mil. ($36 mil. + $0 mil. + $3.6 mil.)
Ratings List
Wells Enterprises Inc.
Corporate credit rating BB-/Stable/--
Ratings Assigned
WEI Sales LLC
Senior secured
$175 mil. term loan B due 2025 BB
Recovery rating 2(75%)
WICKED TACO: Case Summary & 6 Unsecured Creditors
-------------------------------------------------
Debtor: Wicked Taco, LLC
932 Laskin Road, Ste. 200
Virginia Beach, VA 23451
About the Debtor: Wicked Taco, LLC is a privately held
company in Virginia Beach, Virginia.
Its principal place of business is
located at 3928 Western Blvd., Raleigh, NC
27606.
Chapter 11 Petition Date: March 2, 2018
Case No.: 18-01039
Court: United States Bankruptcy Court
Eastern District of North Carolina
(Raleigh Division)
Judge: Hon. David M. Warren
Debtor's Counsel: Gregory B. Crampton, Esq.
NICHOLLS & CRAMPTON, P.A.
3700 Glenwood Avenue, Suite 500
Raleigh, NC 27612
Tel: 919 781-1311
Fax: 919 782-0465
E-mail: gcrampton@nichollscrampton.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joseph W. Luter, IV, sole manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's six unsecured creditors is available for free
at:
http://bankrupt.com/misc/nceb18-01039.pdf
WILMA'S DEN: Voluantary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Wilma's Den LLC
4909 N 44th St
Phoenix, AZ 85018
Type of Business: Wilma's Den LLC is a privately held company in
Phoenix, Arizona, engaged in activities related
to real estate.
Chapter 11 Petition Date: March 8, 2018
Case No.: 18-02233
Court: United States Bankruptcy Court
District of Arizona (Phoenix)
Judge: Hon. Brenda K. Martin
Debtor's Counsel: Christopher H. Bayley, Esq.
SNELL & WILMER, L.L.P.
One Arizona Center
400 E. Van Buren St, Ste 1900
Phoenix, AZ 85004-2202
Tel: 602-382-6214
Fax: 602-382-6070
E-mail: CBayley@swlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Keith Bierman, manager.
The Debtor indicated that it has no unsecured creditors.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/azb18-02233.pdf
WRAP MEDIA: Court Approves Disclosure Statement
-----------------------------------------------
Judge Hannah L. Blumensteil of the U.S. Bankruptcy Court for the
Northern District of California, San Francisco Division, has
approved the disclosure statement explaining the plan of
reorganization proposed by InterPrivate LLC and Matthew Luckett for
Wrap Media, Inc.
As previously reported by The Troubled Company Reporter, the second
amended combined Chapter 11 plan of reorganization provides that as
dispute has also recently arisen between the Plan Proponents and
BrunoCo., Inc., as assignee of Wrap Media, LLC's interest in the
License Agreement, in connection with the License Agreement. The
dispute concerns language in the License Agreement that BrunoCo
asserts to have given it the ability to cancel the License
Agreement. The Plan Proponents assert that a side letter dated June
25, 2017 in connection with the License Agreement prevents BrunoCo
from exercising the alleged termination right. The dispute has not
yet been resolved. If it is resolved prior to the plan confirmation
hearing, the Plan Proponents will update the Court and supplement
or amend the Plan as necessary. If the dispute is not resolved
prior to the Plan confirmation hearing, the Plan Proponents reserve
the right bring an action under the side letter for any claims they
may have thereunder, including for declaratory relief, breach of
contract, and damages.
A full-text copy of the Second Amended Combined Plan is available
at:
http://bankrupt.com/misc/canb16-31326-90.pdf
About Wrap Media
Wrap Media LLC owns a mobile engagement and messaging platform that
supercharges marketing, sales and customer service.
Wrap Media, Inc., conducts no operations. Wrap Media, Inc.'s sole
asset is an approximately 60% equity interest in Wrap Media, LLC.
WMI was the financing vehicle for the enterprise, raising several
rounds of equity and obtaining $9.5 million of convertible debt
financing. WMI has four creditors consisting of three convertible
note holders owed an aggregate of approximately $10 million and
joint liability on the secured debt held by SVB.
Wrap Media, LLC, and holding company Wrap Media, Inc., sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D.
Cal. Case Nos. 16-31325 and 16-31326) on Dec. 10, 2016. The
petitions were signed by Eric Greenberg, chief executive officer.
The Court entered an order jointly administering the two cases but
vacated this order upon Wrap Media, LLC's oral motion on April 7,
2017.
The cases are assigned to Judge Hannah L. Blumenstiel.
At the time of the filing, the Debtors estimated their assets at $1
million to $10 million and liabilities at $10 million to $50
million.
The Debtors hired St. James Law, P.C., as their legal counsel; and
Beyer Law Group, LLP, as special counsel. Kranz & Associates was
hired for outsourced operations.
On Jan. 31, 2017, the U.S. trustee for Region 17 appointed an
official committee of unsecured creditors. The Committee's
attorneys are Tobias S. Keller, Esq., Keith A. McDaniels, Esq., and
Dara L. Silveria, Esq., at Keller & Benvenutti LLP, in San
Francisco, California.
WTE-S&S AG: Lender Plan Proposes 50% Recovery to Unsecureds
-----------------------------------------------------------
The State Bank of Chilton, lender to WTE-S&S AG Enterprises, LLC,
filed a plan of reorganization and accompanying disclosure
statement contemplating the payment of 50% of the allowed general
unsecured claims.
There are approximately $181,000.00 in Class 3 General Unsecured
Claims. Holders of Allowed Class 3 Claims will receive payments
totaling 50% of those Allowed Claims, payable as follows: (a) 25%
of their Allowed Class 3 Claims paid within fourteen days after the
Effective Date, using proceeds of a loan in that amount to be made
by the Lender to the Reorganized Debtor on the Effective Date; and
(b) thereafter, five payments of 5% of their Allowed Class 3
Claims, to be made within 14 days after the close of five
consecutive calendar quarters, starting with the quarter ending
March 31, 2018, and concluding with the quarter ending March 31,
2019.
On the Effective Date, the Reorganized Debtor will issue Amended
Notes and the Amended Security Agreement to the Lender, and will
pay the Lender Debt pursuant to the terms of the Amended Notes.
These payments will be credited separately for the Amended Larger
Note and the Amended Lesser Note, respectively. Each of the Amended
Notes will have a term of five years, bear interest at the rate of
5% per annum, and be payable in 60 equal payments, commencing one
month after the Effective Date. Any collections obtained from the
Guaranty Action will be credited to payment of the Amended Lesser
Note. The Amended Lesser Note will not affect the Guaranty Action,
which shall pertain to the terms of the original Lesser Note.
The Class 1 Claim will be reduced from more than $1,300,000.00 to
$1,00,000.00 by reducing the outstanding amount owed only under the
Amended Larger Note.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/ilnb16-09913-291.pdf
About WTE-S&S AG Enterprises
WTE-S&S AG Enterprises, LLC, is a limited liability company formed
for the purpose of constructing an anaerobic digester on the
largest dairy farm in Door County, Wisconsin, so as to generate
electricity from harnessing methane extracted from animal waste.
WTE-S&S AG Enterprises filed for Chapter 11 bankruptcy protection
(Bankr. N.D. Ill. Case No. 16-09913) on March 23, 2016. The
petition was signed by James G. Philip, manager and designated
representative. The Debtor estimated assets and liabilities in the
range of $1 million to $10 million at the time of the filing.
The case is assigned to Judge Donald R. Cassling.
The Debtor is represented by David K. Welch, Esq., at Crane,
Heyrnan, Simon, Welch & Clar.
ZERO ENERGY: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Zero Energy Contracting, Inc
13850 Cerritos Corporate Dr.
Cerritos, CA 90703
Tel: 310.308.7680
Business Description: Zero Energy Contracting is a solar company
based in Cerritos, California. The Company
offers solar panels, asbestos removal,
ducting and insulation and whole house fan
services. It also provides free home audit
services. Zero Energy is committed to
reducing energy output, eliminating waste,
and helping its customers save money.
http://zeroenergyco.com/
Chapter 11 Petition Date: March 8, 2018
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Case No.: 18-12552
Debtor's Counsel: Devin Sreecharana, Esq.
MAY POTENZA BARAN & GILLESPIE P.C.
201 N Central Ave 22nd Floor
Phoenix, AZ 85004
Tel: 602-252-1900
Fax: 602-252-1114
E-mail: devin@maypotenza.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
Paul Hanson, CEO, signed the petition.
The Debtor did not file a list of its 20 largest unsecured
creditors together with the petition.
A full-text copy of the petition is available for free at:
https://www.scribd.com/document/373381580/cacb18-12552
[*] ILR Criticizes Asbestos Trust Sufficiency & Safeguards
----------------------------------------------------------
A report released by the U.S. Chamber Institute for Legal Reform
last week says asbestos bankruptcy trusts are being depleted,
jeopardizing their ability to fully compensate future claimants.
The report cites that 21 of 35 asbestos trusts operating as of
early 2008 are paying an average of 40% less than they paid in
2008.
The report, entitled Dubious Distribution: Asbestos Bankruptcy
Trust Assets and Compensation, shows that $40 billion was
contributed to asbestos trusts between 2004 and 2016, and $25
billion remains. Meanwhile, the report cites that the trust system
lacks safeguards to preserve its assets, and that it spends less
than three cents per dollar to verify the legitimacy of claims.
Additionally, Dubious Distribution points out that most trusts have
no contingency fee caps, regularly allowing plaintiffs' attorneys
to collect 40% of claims paid out. A copy of the 28-page report is
available at https://goo.gl/8psj3D at no charge.
The report says that after attorneys' fees, trusts expenses, and
claims paid to claimants with other ailments are deducted, it is
likely that less than half of all trust payments are made to
claimants with mesothelioma.
"Asbestos bankruptcy trusts operate behind closed doors, leading to
widespread, systemic abuse that threatens their ability to pay
future claimants," said ILR President Lisa A. Rickard. "That's why
Congress and state legislatures must bring transparency to the
system to deter fraud."
In March 2017, ILR continues, the U.S. House of Representatives
passed the "Fairness in Class Action Litigation and Furthering
Asbestos Claim Transparency (FACT) Act of 2017" (H.R. 985). The
FACT Act portion of the bill would reduce "double dip" claims
against the trusts and in the tort system by requiring the trusts
to report quarterly on who files claims. The system would ensure
money is held in the trusts for future victims, while protecting
individuals' personal information just the same as the courts do.
Meanwhile, ILR's Dubious Distribution report observes that 12
states have enacted local asbestos trust transparency laws, and in
2017, Iowa, Mississippi, North Dakota, and South Dakota enacted
such laws.
ILR says it seeks to promote civil justice reform through
legislative, political, judicial, and educational activities at the
national, state, and local levels.
The U.S. Chamber of Commerce is the world's largest business
federation representing the interests of more than 3 million
businesses of all sizes, sectors, and regions, as well as state and
local chambers and industry associations.
[^] BOND PRICING: For the Week from March 5 to 9, 2018
------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
Alpha Appalachia
Holdings Inc ANR 3.250 2.048 8/1/2015
American Eagle Energy Corp AMZG 11.000 1.148 9/1/2019
Appvion Inc APPPAP 9.000 8.640 6/1/2020
Appvion Inc APPPAP 9.000 8.640 6/1/2020
Avaya Inc AVYA 10.500 4.433 3/1/2021
Avaya Inc AVYA 10.500 4.433 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 18.500 6/15/2021
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 7.875 6.500 4/15/2022
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 8.625 7.000 10/15/2020
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 8.625 6.912 10/15/2020
BreitBurn Energy
Partners LP / BreitBurn
Finance Corp BBEP 8.625 6.912 10/15/2020
Cenveo Corp CVO 6.000 49.500 8/1/2019
Cenveo Corp CVO 8.500 9.813 9/15/2022
Cenveo Corp CVO 8.500 10.500 9/15/2022
Cenveo Corp CVO 6.000 50.500 8/1/2019
Chassix Holdings Inc CHASSX 10.000 8.000 12/15/2018
Chassix Holdings Inc CHASSX 10.000 8.000 12/15/2018
Chukchansi Economic
Development Authority CHUKCH 9.750 63.451 5/30/2020
Claire's Stores Inc CLE 9.000 68.308 3/15/2019
Claire's Stores Inc CLE 8.875 23.001 3/15/2019
Claire's Stores Inc CLE 7.750 8.992 6/1/2020
Claire's Stores Inc CLE 9.000 68.402 3/15/2019
Claire's Stores Inc CLE 7.750 8.992 6/1/2020
Claire's Stores Inc CLE 9.000 68.550 3/15/2019
Cobalt International
Energy Inc CIEI 3.125 3.000 5/15/2024
Cobalt International
Energy Inc CIEI 2.625 3.625 12/1/2019
Cumulus Media Holdings Inc CMLS 7.750 21.000 5/1/2019
Dow Chemical Co/The DOW 1.900 99.266 3/15/2018
EV Energy Partners LP /
EV Energy Finance Corp EVEP 8.000 49.609 4/15/2019
EXCO Resources Inc XCOO 8.500 9.050 4/15/2022
Egalet Corp EGLT 5.500 46.250 4/1/2020
Emergent Capital Inc EMGC 8.500 61.140 2/15/2019
Energy Conversion
Devices Inc ENER 3.000 7.875 6/15/2013
Energy Future Holdings Corp TXU 9.750 95.000 10/15/2019
Energy Future Holdings Corp TXU 6.500 15.000 11/15/2024
Energy Future Holdings Corp TXU 5.550 13.773 11/15/2014
Energy Future Holdings Corp TXU 6.550 15.625 11/15/2034
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 11.250 37.959 12/1/2018
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 9.750 38.000 10/15/2019
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 11.250 38.500 12/1/2018
FGI Operating Co LLC /
FGI Finance Inc GUN 7.875 23.249 5/1/2020
FirstEnergy Solutions Corp FE 6.050 34.956 8/15/2021
FirstEnergy Solutions Corp FE 6.050 35.272 8/15/2021
FirstEnergy Solutions Corp FE 6.050 35.272 8/15/2021
Fleetwood Enterprises Inc FLTW 14.000 3.557 12/15/2011
GenOn Energy Inc GENONE 9.500 83.125 10/15/2018
GenOn Energy Inc GENONE 9.500 82.989 10/15/2018
GenOn Energy Inc GENONE 9.500 79.000 10/15/2018
Gibson Brands Inc GIBSON 8.875 80.188 8/1/2018
Gibson Brands Inc GIBSON 8.875 80.759 8/1/2018
Gibson Brands Inc GIBSON 8.875 80.555 8/1/2018
Homer City Generation LP HOMCTY 8.137 38.750 10/1/2019
Iconix Brand Group Inc ICON 1.500 98.425 3/15/2018
Illinois Power Generating Co DYN 6.300 33.375 4/1/2020
Ingersoll-Rand Global
Holding Co Ltd IR 6.875 102.345 8/15/2018
Interactive Network Inc /
FriendFinder Networks Inc FFNT 14.000 70.250 12/20/2018
IronGate Energy Services LLC IRONGT 11.000 32.625 7/1/2018
IronGate Energy Services LLC IRONGT 11.000 31.250 7/1/2018
IronGate Energy Services LLC IRONGT 11.000 32.625 7/1/2018
IronGate Energy Services LLC IRONGT 11.000 32.487 7/1/2018
Las Vegas Monorail Co LASVMC 5.500 4.037 7/15/2019
Lehman Brothers Holdings Inc LEH 2.000 3.326 3/3/2009
Lehman Brothers Holdings Inc LEH 5.000 3.326 2/7/2009
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 1.600 3.326 11/5/2011
Lehman Brothers Holdings Inc LEH 1.500 3.326 3/29/2013
Lehman Brothers Holdings Inc LEH 4.000 3.326 4/30/2009
Lehman Brothers Inc LEH 7.500 1.226 8/1/2026
Linc USA GP / Linc
Energy Finance USA Inc LNCAU 9.625 2.250 10/31/2017
MF Global Holdings Ltd MF 3.375 30.125 8/1/2018
MModal Inc MODL 10.750 6.125 8/15/2020
Mashantucket Western
Pequot Tribe MASHTU 7.350 15.250 7/1/2026
Midstates Petroleum
Co Inc / Midstates
Petroleum Co LLC MPO 10.750 4.057 10/1/2020
Molycorp Inc MCP 10.000 1.301 6/1/2020
Murray Energy Corp MURREN 11.250 42.768 4/15/2021
Murray Energy Corp MURREN 11.250 43.407 4/15/2021
Murray Energy Corp MURREN 9.500 43.184 12/5/2020
Murray Energy Corp MURREN 9.500 43.184 12/5/2020
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 7.025 5/15/2019
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 7.025 5/15/2019
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 7.025 5/15/2019
Nine West Holdings Inc JNY 6.125 8.335 11/15/2034
Nine West Holdings Inc JNY 8.250 6.886 3/15/2019
Nine West Holdings Inc JNY 6.875 8.086 3/15/2019
Nine West Holdings Inc JNY 8.250 7.245 3/15/2019
OMX Timber Finance
Investments II LLC OMX 5.540 6.666 1/29/2020
Orexigen Therapeutics Inc OREX 2.750 34.000 12/1/2020
Orexigen Therapeutics Inc OREX 2.750 39.997 12/1/2020
PaperWorks Industries Inc PAPWRK 9.500 54.586 8/15/2019
PaperWorks Industries Inc PAPWRK 9.500 54.313 8/15/2019
Powerwave Technologies Inc PWAV 2.750 0.435 7/15/2041
Powerwave Technologies Inc PWAV 3.875 0.435 10/1/2027
Powerwave Technologies Inc PWAV 1.875 0.435 11/15/2024
Powerwave Technologies Inc PWAV 3.875 0.435 10/1/2027
Powerwave Technologies Inc PWAV 1.875 0.435 11/15/2024
Prospect Holding Co LLC /
Prospect Holding
Finance Co PRSPCT 10.250 48.250 10/1/2018
Real Alloy Holding Inc RELYQ 10.000 72.000 1/15/2019
Real Alloy Holding Inc RELYQ 10.000 69.243 1/15/2019
Renco Metals Inc RENCO 11.500 26.750 7/1/2003
Rex Energy Corp REXX 6.250 31.405 8/1/2022
Rex Energy Corp REXX 8.875 29.437 12/1/2020
SAExploration Holdings Inc SAEX 10.000 56.367 7/15/2019
SandRidge Energy Inc SD 7.500 1.620 2/15/2023
Sears Holdings Corp SHLD 6.625 75.729 10/15/2018
Sears Holdings Corp SHLD 8.000 36.441 12/15/2019
Sears Holdings Corp SHLD 6.625 76.603 10/15/2018
Sears Holdings Corp SHLD 6.625 76.603 10/15/2018
SiTV LLC / SiTV Finance Inc NUVOTV 10.375 61.750 7/1/2019
SiTV LLC / SiTV Finance Inc NUVOTV 10.375 64.375 7/1/2019
TerraVia Holdings Inc TVIA 5.000 5.836 10/1/2019
TerraVia Holdings Inc TVIA 6.000 5.830 2/1/2018
Texas Competitive Electric
Holdings Co LLC /
TCEH Finance Inc TXU 11.500 1.000 10/1/2020
Texas Competitive Electric
Holdings Co LLC /
TCEH Finance Inc TXU 11.500 0.897 10/1/2020
Toys R Us - Delaware Inc TOY 8.750 15.563 9/1/2021
Toys R Us Inc TOY 7.375 14.500 10/15/2018
Transworld Systems Inc TSIACQ 9.500 27.885 8/15/2021
Transworld Systems Inc TSIACQ 9.500 28.104 8/15/2021
UCI International LLC UCII 8.625 4.780 2/15/2019
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 Energy Inc WLTG 9.875 0.834 12/15/2020
Westmoreland Coal Co WLB 8.750 41.089 1/1/2022
Westmoreland Coal Co WLB 8.750 40.679 1/1/2022
iHeartCommunications Inc IHRT 14.000 13.616 2/1/2021
iHeartCommunications Inc IHRT 7.250 21.610 10/15/2027
iHeartCommunications Inc IHRT 14.000 13.492 2/1/2021
iHeartCommunications Inc IHRT 14.000 13.492 2/1/2021
*********
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 2018. 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 ***