/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/180419.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, April 19, 2018, Vol. 22, No. 108 Headlines 13300 ALEXANDRIA: Case Summary & Unsecured Creditor 22 FISKE PLACE: Dist. Court Affirms Order on Law Firm Judgment Lien ACANDS INC: Dist. Ct. Affirms Access Decision in Favor of HII, FMC ACOSTA INC: Moody's Lowers CFR to Caa2 & Secured Debts to Caa1 AEGIS TOXICOLOGY: Moody's Rates New 1st Lien Debt B3, Outlook Pos. ALGOZINE MASONRY: May Use Cash Collateral Through June 6 ALKHAIRY HOSPITALITY: Case Summary & 3 Unsecured Creditors AMADO AMADO SALON: Taps Kreston PR as Accountant AMERIFLEX ENG'G: Taps Willamette as Business Valuation Expert BBL BUILDERS: Court Nixes SPI Objection to Special Master Report BEAULIEU GROUP: S. Lightsey Suit Administratively Closed BLACKFOOT CONSTRUCTION: May Use Cash Collateral on Final Basis BON-TON STORES: Court Approves 2L Noteholders, Liquidators' Bid BON-TON STORES: Said to Close Stores in 10 to 12 Weeks BRAVE PARENT: Moody's Assigns B3 CFR & Rates $265MM Loans B2 BRIDGEHAMPTON STONE: Taps S Kekatos & Associates as Accountant BRM HOME: Gets Interim Approval to Hire Greg Murray as CRO CAPSTONE LOGISTICS: Moody's Alters Outlook to Stable & Affirms CFR COMMUNITY CHOICE: S&P Lowers ICR to 'CC', Outlook Negative COMMUNITY MEMORIAL: S&P Lowers Rating on 2011 Bonds to 'BB' CONSTELLATION ENTERPRISES: Dismissal of Committee Appeals Affirmed COOK INVESTMENTS: Trustee Bid to Stay Judgment Pending Appeal Nixed DANCING WATERS: Brokers Ask Court to Approve Employment DATACONNEX LLC: Has Authorization to Use Cash Collateral DC DOORS: Court OK's First Amended Disclosure Statement DERRICK PUGH: U.S. Trustee Unable to Appoint Committee DGS REALTY: May Use Ocwen Cash Collateral Until May 31 DOUGLAS JEFFERIES: Court's Dismissal of Chapter 11 Case Remains EDEN HOME: DOJ Watchdog Appoints S.N. Goodman as PCO EVERETT'S AUTOMOTIVE: Unsecureds to Get 79% Under Plan EXPERT CAR: U.S. Trustee Unable to Appoint Committee FARWEST PUMP: May 23 Disclosure Statement Hearing FIREWATER RIVER: Case Summary & 8 Unsecured Creditors FIRSTENERGY SOLUTIONS: Seeks to Hire A&M, Appoint CRO FOLTS HOME: FRNC, et al., Suit Referred to Bankr. Court GEM HOSPITALITY: U.S. Trustee Unable to Appoint Committee GREEN DREAMS: U.S. Trustee Unable to Appoint Committee GREENE AVENUE: Taps Biolsi Law Group as Special Counsel GT ADVANCED: Former Officers' Bid to Dismiss Trustee Suit Junked GTT COMMUNICATIONS: S&P Affirms B Corp. Credit Rating, Outlook Neg. HANISH LLC: May Use Phoenix REO Cash Collateral Until June 30 HARDES HOLDING: Taps Bantz Gosch as Special Counsel HAROLD ROSBOTTOM: Order Denying Bid to Vacate Trustee Plan Upheld HDJ & J HOLDINGS: Seeks Authority to Use H & R Cash Collateral HERMAN M. & AMANDA: U.S. Trustee Unable to Appoint Committee JASON FLY LOGGING: Taps Taylor and Martin as Appraiser JOHNS TRUCKING: Court Confirms Chapter 11 Plan of Reorganization JOSEPH DETWEILER: Acquittal Orders on Misrepresentation Affirmed KEAST ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors KESTREL ACQUISITION: S&P Assigns Prelim. BB Rating on Secured Debt KEY SAFETY: Moody's Withdraws All Ratings KEYW CORP: S&P Assigns 'B+' Corp. Credit Rating, Outlook Stable LAMPLIGHT CONDOMINIUM: Unsecureds to Get 38.6% Under Plan LAURIE A. TODD: Bankr. Court Disallows Exemption of Inherited IRA LEHMAN BROTHERS: General Ore Loses Bid to Allow Claims LINCOLN PAPER: Court Approves Disclosure Statement LINDA THE BRA LADY: Gets Final OK to Continue Using Cash Collateral LIVING BENEFITS ASSET: Contract with Kestrel Voidable Under IAA MATADOR PROCESSORS: Founder Loses Age Discrimination Lawsuit MESAW LLC: Permitted to Use Cash Collateral Until May 31 METROPOLITAN DIAGNOSTIC: May Use Cash Collateral Through April 30 NEW HOPE: Court Approves Disclosure Statement NN INC: S&P Gives B- Rating to $200MM 2nd Lien Term Loan Due 2023 NORTEL NETWORKS: Class Action Against Former Execs Dismissed OHIO SCRAP: Dist. Ct. OK's FMSB Bid to Enforce Settlement Agreement OHLONE TRIBE: Court Grants U.S. Trustee Bid to Dismiss Ch. 11 Case ONE CALL: S&P Lowers Corp. Credit Rating to 'CCC+', Outlook Stable OWENS & MINOR: S&P Assigns Prelim 'BB' Ratings on New Term Loans P3 FOODS: Wants Plan Filing Extended Through June 19 PEARL AGGREGATE: Seeks Approval to Retain Insiders PIEDMONT SALES: Court Approves Interim Use of Cash Collateral PINNACLE SERVICES: Seeks Authorization to Use Cash Collateral PROSPECTOR OFFSHORE: Stay of Settlement Order Unnecessary, Ct. Says R1 RCM: S&P Assigns 'B-' Corporate Credit Rating, Outlook Stable RAIN TREE HEALTHCARE: Appeal from Case Dismissal Not Equitably Moot ROCKY PINE: Court Approved Continued Cash Collateral Use RYNARD PROPERTIES: Taps Pettit & Company as Accountant SAN FRANCISCO SHIP: Case Summary & 20 Largest Unsecured Creditors SOUTHEASTERN GROCERS: May Use Cash Collateral on Interim Basis SOUTHERN INYO: Unsecureds to Get $100K Under Amended Plan SPENCER TRANSPORTATION: Dist. Court Denies Bid to Dismiss BMO Suit SPRUHA SHAH: Allowed Access to Cash Collateral Through April 30 SUMMIT FINANCIAL: Allowed to Use Cash Collateral Until April 24 TAKATA CORP: Dist. Ct. OK's Proposed Restitution Fund Methodology TOTAL DIAGNOSTIX: Taps Kelly Hart & Hallman as Special Counsel UTSA APARTMENTS 8: 5th Cir. Affirms Ruling Reducing Woodlark Claims VER TECHNOLOGIES: Taps Kurtzman Carson as Claims Agent VERMILION ENERGY: S&P Puts BB- CCR on Watch Pos. Amid Spartan Deal WESTPORT HOLDINGS: Court Conditionally Approves Plan Disclosures WOOTON GROUP: Taps Newmark Grubb as Real Estate Broker [*] Getzler Announces Promotions of Luke Andrews, Jubin Pandey [*] Liebman Named A&M North American Restructuring Practice Co-Head [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* 13300 ALEXANDRIA: Case Summary & Unsecured Creditor --------------------------------------------------- Debtor: 13300 Alexandria Dr. Holdings, LLC 99 Roberts Rd Englewood Cliffs, NJ 07632 Business Description: 13300 Alexandria Dr. Holdings, LLC listed its business as a Single Asset Real Estate (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: April 17, 2018 Court: United States Bankruptcy Court Southern District of Florida (Miami) Case No.: 18-14511 Judge: Hon. Laurel M Isicoff Debtor's Counsel: Ido J Alexander, Esq. LEIDERMAN SHELOMITH ALEXANDER + SOMODEVILLA, PLLC 2699 Stirling Rd., C-401 Fort Laudedale, FL 33312 Tel: (305) 894-6163 E-mail: ija@lsaslaw.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Denise Vankin, manager. The Debtor lists the City of Miami as its sole unsecured creditor, holding a claim of $1.09 million. A full-text copy of the petition is available for free at: http://bankrupt.com/misc/flsb18-14511.pdf 22 FISKE PLACE: Dist. Court Affirms Order on Law Firm Judgment Lien ------------------------------------------------------------------- The appeals case captioned 22 FISKE PLACE LLC and NICHOLAS GORDON, Appellants, v. LANIN LAW P.C., Appellee, No. 1:17-cv-03038 (ALC) (S.D.N.Y.) is an appeal arising from an order of the U.S. Bankruptcy Court for the Southern District of New York dated April 4, 2017 that granted Appellee Lanin Law P.C.'s motion compelling the Debtor's Chapter 11 Trustee to pay Appellee's judgment lien against certain real property, formerly owned by Debtor 22 Fiske Place, LLC, from the proceeds of the sale of the Property. Upon evaluation of the arguments presented, District Judge Andrew L. Carter affirms the bankruptcy court's order. On Sept. 19, 2012, judgment was entered in Kings County Clerk's Office in favor of Lanin Law P.C. against Appellants and it became a judgment lien on the Debtor's Property. On May 28, 2015, Debtor filed for Chapter 11 Bankruptcy. Gordon omitted Lanin Law P.C. as a secured creditor from his bankruptcy disclosures, despite knowing that there was a judgment against 22 Fiske Place. Consequently, Lanin Law P.C. did not receive any notice of the Chapter 11 case, did not participate in the case, and was not aware that the Property was sold. The Chapter 11 Plan was confirmed on June 16, 2016. After Lanin Law P.C. discovered what happened in the Chapter 11 case, Lanin Law P.C. filed a motion to compel payment of the judgment by the Trustee. A hearing was held on March 30, 2017, and the Bankruptcy Court granted the motion, ruling that the judgment lien was entitled to payment. Debtor and Gordon appealed. It is well settled that a docketed state court judgment based on a confession creates a judicial lien. Generally, "liens pass through bankruptcy unaffected." The Bankruptcy Code "allows a plan to extinguish a lien only if the underlying property is 'dealt with,' and that condition cannot be fairly satisfied in the absence of the interested parties, including the security holder." Thus, a lienholder's participation in the reorganization is required for the lien to be extinguished by the reorganization. Neither actual nor constructive notice of the reorganization is sufficient. Lanin Law P.C. had a judgment lien and did not participate in the Chapter 11 proceeding. Therefore, the judgment lien survived the plan and is entitled to payment. This renders all other issues raised (properly or not) on appeal moot. A copy of the Court's March 26, 2018 Order is available at https://is.gd/vwsUIM from Leagle.com. 22 Fiske Place, LLC, Debtor, represented by Tejinder Singh Bains, The Law Offices of Ali & Bains P.C. 22 Fiske Place, LLC & Nicholas Gordon, Appellants, represented by Tejinder Singh Bains, The Law Offices of Ali & Bains P.C. Lanin Law P.C., Appellee, represented by Scott L. Lanin, Lanin Law P.C. About 22 Fiske Place 22 Fiske Place, LLC, sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 15-11410) in Manhattan on May 28, 2015. The case judge is the Hon. Shelley C. Chapman. Scott S. Markowitz, Esq., at Tarter Krinsky & Drogin LLP, is the Debtor's counsel. The Debtor estimated assets and debt of $1 million to $10 million. Ian J. Gazes has been named as chapter 11 trustee of the Debtor's estate on May 16, 2016. ACANDS INC: Dist. Ct. Affirms Access Decision in Favor of HII, FMC ------------------------------------------------------------------ District Judge Leonard P. Stark entered a ruling affirming the Bankruptcy Court's decision giving bankruptcy documents access to Appellants Honeywell International Inc., and Ford Motor Company in the case captioned IN RE: Motions Seeking Access to 2019 Statements, Civ. No. 16-1078-LPS (D. Del.). The appeal relates to nine Delaware bankruptcy cases, each commenced in connection with the respective debtors' asbestos-related liabilities ("Consolidated Cases"). The appeal arises from the most recent attempt to access thousands of exhibits that were submitted to the Bankruptcy Court pursuant to Federal Rule of Bankruptcy Procedure 2019 in connection with administering the nine asbestos bankruptcies. Consistent with a series of orders entered by the Bankruptcy Court in implementing Rule 2019, the 2019 Exhibits are in the possession of the Clerk of the Bankruptcy Court but are not available on the public docket. Appellant Honeywell, joined by Ford, filed a request in each of the Consolidated Cases seeking unlimited access to the 2019 Exhibits, even though all but one of the nine Consolidated Cases are closed. Appellants contend that they, like any entity, are entitled to indefinite access to the 2019 Exhibits, to use them for any purpose, including, but not limited to, investigating potential fraud in the claims process and advancing Appellants' legislative and lobbying activities. Appellees -- including various Trust Advisory Committees and the Future Claimants Representatives4 -- opposed the request, on grounds including that Appellants' admitted purposes for requesting access to the 2019 Exhibits are improper and, anyway, the 2019 Exhibits are useless for such purposes. On Nov. 8, 2016, the Bankruptcy Court entered its opinion and order in each of the Consolidated Cases, granting Appellants limited access to the 2019 Exhibits for the purpose of investigating potential fraud in the claims process; the Bankruptcy Court imposed additional limitations on access as well. Because Appellants want unlimited access to the 2019 Exhibits, they have appealed the Bankruptcy Court's decision "to the extent that the Opinion and Order restrict Appellants' ability to access and use the 2019 Exhibits." Appellees have cross-appealed on the basis that the Bankruptcy Court should have denied Appellants access to the 2019 Exhibits altogether. Upon review of the case, the Court finds that the Bankruptcy Court committed no error of law. The Bankruptcy Court entered the 2019 Orders in 2004, based on its supervisory power over its own records, its ability to tailor the requirements of Bankruptcy Rule 2019, its equitable powers under section 105(a), and, later, the discretion granted by Congress in § 107(c). The 2019 Orders are not, at this point, appealable. The 2019 Orders implemented certain procedures to protect the privacy of individuals involved in the Consolidated Cases. Those protections included filing the 2019 Exhibits with the Clerk and requiring a party seeking access to file a motion and explain why access was sought. In determining that Appellants should be granted access to the 2019 Exhibits, the Bankruptcy Court properly looked to the Appellants' asserted purpose, as required by the 2019 Orders. In determining that the 2019 Exhibits contain information coming within section 107(c), the Bankruptcy Court found that the 2019 materials included identifying information -- including full social security numbers and private medical information. These findings were not clearly erroneous. In determining that unlimited disclosure of the 2019 Exhibits presented an undue risk of unlawful injury, as contemplated by section 107(c), the Bankruptcy Court identified the disclosure of personal identifiers and private medical information as posing such a risk. Again, this finding was not clearly erroneous. In imposing restrictions on Appellants' access to the 2019 Exhibits, the Bankruptcy Court acted consistent with its authority. It did not abuse its discretion. Accordingly, the Court affirms the Bankruptcy Court's Access Decision. A full-text copy of the Court's March 27, 2018 Opinion is available at https://is.gd/dQe9ta from Leagle.com. Acands, Inc., Debtor, represented by Thomas Henry Kovach, A M Saccullo Legal, LLC. Honeywell International Inc., Appellant, represented by Justin K. Edelson -- jedelson@polsinelli.com -- Polsinelli PC & Darren Azman -- dazman@mwe.com -- McDermott Will and Emery, pro hac vice. Ford Motor Company, Defendant, represented by Christian J. Singewald -- singewaldc@whiteandwilliams.com -- White & Williams & Gregory W. Werkheiser -- gwerkheiser@mnat.com -- Morris, Nichols, Arsht & Tunnell LLP. North American Refractories Company Asbestos Personal Injury Settlement Trust Advisory Committee, Appellee, represented by Anthony Michael Saccullo, A M Saccullo Legal, LLC & Thomas Henry Kovach, A M Saccullo Legal, LLC. Owens Corning Sales, LLC, f/k/a Owens Corning, and its Affiliated Reorganized Debtors, Appellee, represented by Mark Minuti -- mark.minuti@saul.com -- Saul Ewing Arnstein & Lehr LLP. Washington Legal Foundation, Amicus, represented by Nicholas E. Skiles -- nskiles@swartzcampbell.com -- Swartz Campbell LLC. American Association for Justice, Amicus, represented by Raeann Warner -- raeann@jcdelaw.com -- Jacobs & Crumplar, P.A. & Robert S. Peck, Center for Constitutional Litigation, P.C, pro hac vice. About AcandS Inc. Based in Lancaster, Pennsylvania, ACandS Inc. was an insulation contracting company, primarily engaged in the installation of thermal and mechanical insulation. In later years, the Debtor also performed a significant amount of asbestos abatement and other environmental remediation work. The company filed for chapter 11 protection on Sept. 16, 2002 (Bankr. Del. Case No. 02-12687). Laura Davis Jones, Esq., Curtis A. Hehn, Esq., James E. O'Neill, Esq., and Michael Paul Migliore, Esq., at Pachulski Stang Ziehl & Jones, P.C., represent the Debtor in its restructuring efforts. Kathleen Campbell Davis, Esq., Aileen F. Maguire, Esq., Mark T Hurford, Esq., and Marla Rosoff Eskin, Esq., at Campbell & Levine, LLC, represent the Official Committee of Asbestos Personal Injury Claimants. At Dec. 31, 2006, the Debtor disclosed that it had book assets of approximately $11.78 million and book liabilities, including liabilities for the payment of asbestos-related and other claims of $11.78 million. At June 30, 2007, net book assets before liabilities for asbestos-related and other claims was approximately $9,010,000. The Court confirmed the Debtors' Second Amended Chapter 11 Plan of Reorganization in May 2008. ACOSTA INC: Moody's Lowers CFR to Caa2 & Secured Debts to Caa1 -------------------------------------------------------------- Moody's Investors Service downgraded Acosta, Inc.'s Corporate Family Rating ("CFR") to Caa2 from Caa1 and its Probability of Default Rating to Caa2-PD from Caa1-PD. The ratings for Acosta's senior secured bank credit facilities were also downgraded to Caa1 from B3. At the same time, the Acosta's senior unsecured notes rating was affirmed at Caa3. The rating outlook remains stable. The downgrade to Caa2 reflects Moody's view that ongoing industry and competitive pressures will make it difficult for Acosta gain enough net new business growth to improve EBITDA to a level that is supportive of its highly leveraged capital structure. To date, Acosta has been unable to stabilize ongoing EBITDA and free cash flow declines which started in 2016. For the twelve months ended January 31, 2018, Acosta's debt to EBITDA pro forma for acquisitions stood at 9.6 times. Free cash flow after mandatory debt payments was negative ($46) million for the same time period. While Acosta has put in place a sizable cost reduction program, Moody's does not expect this to have an impact on EBITDA until 2019 as the cash costs to achieve the savings will largely offset the benefits in 2018. In addition, while cash flow is expected to improve in 2018, cash flow will not reach the level necessary to fully cover the mandatory debt repayments until 2019. "We view Acosta's capital structure as unsustainable as we believe industry headwinds will make it difficult for it to improve EBITDA over the next two years to the extent that it supports refinancing the large amount of debt which matures in 2021 without a high risk of a restructuring," stated Maggie Taylor a senior vice president with Moody's. Downgrades: Issuer: Acosta, Inc. Probability of Default Rating, Downgraded to Caa2-PD from Caa1-PD Corporate Family Rating, Downgraded to Caa2 from Caa1 Senior Secured Bank Credit Facility, Downgraded to Caa1(LGD3) from B3 (LGD3) Outlook Actions: Issuer: Acosta, Inc. Outlook, Remains Stable Affirmations: Issuer: Acosta, Inc. Senior Unsecured Regular Bond/Debenture, Affirmed Caa3 (LGD5) RATINGS RATIONALE Acosta's Caa2 CFR reflects its current level of free cash flow deficits for the last twelve months (after considering mandatory debt repayments) and Moody's expectation that, at best, free cash flow will be overall break even in 2018. The CFR also reflects Acosta's high financial risk associated with its very high debt burden and the heightened risk of a distressed exchange or balance sheet restructuring while it seeks to refinance either its $225 million revolver which expires in September 2019 and its $2 billion term loan which matures in 2021. The Caa2 also reflects ongoing industry headwinds and Acosta's financial sponsor ownership, both of which contribute to its weakened financial profile. Acosta's credit profile continues to benefit from its ability to cover its debt service costs with EBITA to interest expense of 1.4 times at January 31, 2018. The rating also benefits from Acosta's market position as the second largest provider of outsourced sales and merchandising services to retailers, manufacturers, suppliers, and producers of primarily food-related consumer packaged goods. The stable rating outlook acknowledges that we believe Acosta should be able to obtain an extension on the maturity of its revolving credit facility, albeit at a higher cost. It also acknowledges that we believe Acosta will be able to maintain EBITA to interest expense above 1.0 time even after a potential increase in borrowing costs under its revolving credit facility following an extension of its maturity. Acosta's ratings could be upgraded should revenue and EBITDA improve such that debt to EBITDA approaches 8 times with a clear path to bringing debt to EBITDA to a more sustainable level prior to the need to refinance its 2021 debt maturities. An upgrade would also require Acosta to maintain an adequate liquidity profile. The rating outlook could turn to negative should Acosta be unable to stabilize EBITDA and free cash flow over the next few quarters. Ratings could be downgraded should Acosta fail to address the expiration of its 2019 revolver in a timely manner, should its overall liquidity profile weaken, or should the likelihood of default increase for any reason. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Headquartered in Jacksonville, FL, Acosta, Inc. is the second largest provider of outsourced sales and merchandising services to retailers, manufacturers, suppliers, and producers of primarily food-related consumer packaged goods. Annual revenues are close to $1.9 billion. Acosta is primarily owned by affiliates of the Carlyle Group. AEGIS TOXICOLOGY: Moody's Rates New 1st Lien Debt B3, Outlook Pos. ------------------------------------------------------------------ Moody's Investors Service affirmed Aegis Toxicology Sciences Corporation's B3 Corporate Family Rating ("CFR") and the B3-PD Probability of Default Rating and changed the outlook to positive from stable. Concurrently, Moody's assigned a B3 rating to the proposed $50 million revolver expiring 2023 and $320 million first lien term loan due 2025. Proceeds from the new debt will be used to refinance the company's existing debt and pay related fees and expenses. Upon closing of the transaction, ratings on the existing debt will be withdrawn. The positive outlook reflects Moody's expectation that volume growth, new product uptake and further laboratory operating efficiencies will result in revenue and earnings growth over the next 12-18 months that will result in deleveraging and improvement in free cash flow and liquidity. The affirmation of the B3 CFR reflects the company's continued small size, recent challenges in collecting accounts receivable and concentration in pain management testing services. This industry continues to face pricing pressure and scrutiny by regulators and payors. Moody's took the following rating actions: Aegis Toxicology Sciences Corporation Ratings affirmed: Corporate Family Rating at B3 Probability of Default Rating at B3-PD The following ratings were assigned: $50 million senior secured first lien revolving credit facility expiring 2023 at B3 (LGD3) $320 million senior secured first lien term loan due 2025 at B3 (LGD3) The following ratings will be withdrawn at the close of the refinancing: $40 million senior secured first lien revolver due 2019 at B1 (LGD3) $193 million senior secured first lien term loan due 2021 at B1 (LGD3) $100 million senior secured second lien term loan due 2021 at Caa2 (LGD5) RATINGS RATIONALE Aegis' B3 CFR reflects the company's modest scale with pro forma revenue of around $160 million. The ratings are also constrained by the company's concentration in toxicology testing, which we believe will continue to face pricing pressure and the potential for meaningful Medicare rate cuts longer-term. Moody's expects good volume growth, however, and new product launches to drive earnings growth over the next 12-18 months, resulting in leverage declining below 5.0x. The rating could be upgraded if the company can profitably grow its scale and improve business diversity, improves cash flow generation and sustains debt to EBITDA below 5 times. The rating could be downgraded if reimbursement rate cuts or other operating challenges result in weakened liquidity or substantial erosion in earnings. Aegis Toxicology Sciences Corporation (Aegis), headquartered in Nashville, TN, is a specialty toxicology laboratory providing services to the healthcare, sports, workplace and biopharma industries. Aegis is privately-owned by affiliates of financial sponsor ABRY Partners II, LLC (ABRY). Aegis generates revenue of approximately $150 million. ALGOZINE MASONRY: May Use Cash Collateral Through June 6 -------------------------------------------------------- The Hon. James R. Ahler of the U.S. Bankruptcy Court for the Northern District of Indiana has entered an eleventh interim order authorizing Algozine Masonry Restoration, Inc. to use cash collateral to pay for operating and administrative expenses through June 6, 2018. The Court will conduct a pre-trial status conference on the cash collateral use on May 26, 2018, at 1:00 p.m. All of the Debtor's cash and cash equivalents (cash and accounts receivable) as of the Petition Date and all proceeds thereof securing the Debtor's obligations to the Cash Collateral Creditors constitute cash collateral. The Debtor became indebted to following creditors: (1) Ridgestone Bank, whom the Debtor believes to have a blanket lien on all of its assets, including real property located at 2000 North Lafayette Court, Griffith, IN, owned by a Co-Debtor, Algozine Properties LLC, to secure a Term Loan of approximately $1,069,378; (2) Snap Financial, whom the Debtor believes to have a blanket lien on all of its assets, to secure a Revolving Line of Credit in the amount of $256,946; (3) Kabbage Lending, whom the Debtor believes to have a blanket lien on all of its assets, to secure a Revolving Line of Credit in the amount of $$43,107; (4) Bank de Leon, whom the Debtor believes to have a blanket lien on all of its assets, to secure a Revolving Line of Credit in the amount of $72,500; (5) Arch Capital, whom the Debtor believes to have a blanket lien on all of its assets, to secure a Revolving Line of Credit in the amount of $62,950; (6) Platinum Rapid Funding, whom the Debtor believes to have a blanket lien on all of its assets, to secure a Revolving Line of Credit in the amount of $113,000; and (7) Gilco Scaffolding Co. LLC, the Debtor's Judgment creditor for the amount of $114,474, secured by all tools, Equipment, vehicles, and office material used in conducting business for the Debtor. The Debtor knows of no party other than the Cash Collateral Creditors who may claim an interest in the cash collateral. Byline Bank, as successor to Ridgestone Bank, has consented to the use of cash collateral. The Debtor will provide the Cash Collateral Creditors replacement liens on all property of the Debtor of the same type, description and priority as the Cash Collateral Creditors' prepetition collateral to the extent that there is any diminution in value of such property resulting from the Debtor's post-petition use of property. The post-petition security granted to the Cash Collateral Creditors will have priority over all other claims other than U.S. Trustee fees, to the extent of any diminution in value of their collateral, subject to the carve-out. In addition, the Eleventh Interim Order requires the Debtor to: (a) Maintain insurance on all collateral of the Cash Collateral Creditors; (b) Maintain and care for the Debtor's property post-petition, in a manner consistent with the Debtor's maintenance and care for such property pre-petition; (c) Provide the Cash Collateral Creditors with monthly operating reports upon filing with the Court and the U.S. Trustee; (d) Permit the Cash Collateral Creditors, or their representatives, to have access to any of the Debtor's premises, on reasonable prior notice, to inspect the Debtor's books and records and the Cash Collateral Creditors' collateral; and (e) Pay to Byline Bank the amount of $2,699.95 on April 6, 2018 and $2,699.95 on May 18, 2018 as adequate protection. A copy of the Eleventh Interim Order is available at: http://bankrupt.com/misc/innb16-23208-256.pdf About Algozine Masonry Restoration Algozine Masonry Restoration, Inc., filed a Chapter 11 petition (Bankr. N.D. Ind. Case No. 16-23208) on Nov. 10, 2016. In the petition signed by David A. Algozine, vice president, the Debtor disclosed total assets at $217,951 and total liabilities at $3.11 million. The Debtor is represented by Allan O. Fridman, Esq., at the Law Office of O. Allan Fridman. ALKHAIRY HOSPITALITY: Case Summary & 3 Unsecured Creditors ---------------------------------------------------------- Debtor: Alkhairy Hospitality LLC 622 Ellison Road Fort Wayne, IN 46804 Debtor Disposition: Dismissed for failure to pay filing fee Type of Business: Alkhairy Hospitality LLC, a real estate lessor, owns the The Landmark Centre located at 6222 Ellison Road, Fort Wayne IN 46804. The Landmark -- http://www.thelandmarkcentre.com-- is a multi-use reception facility with expansive versatility, including indoor seating up to 720 and an outdoor garden pergola with waterfall that effortlessly accommodates 400 guests for receptions. It provides catering and beverage services and staff for small and large meetings and special occasions, as well as personalized event planning and coordination. Chapter 11 Petition Date: April 17, 2018 Case No.: 18-10635 Court: United States Bankruptcy Court Northern District of Indiana (Fort Wayne Division) Judge: Hon. Robert E. Grant Debtor's Counsel: Dennis G. Golden, Esq. GOLDEN LAW, PC 822 Mill Lake Road Fort Wayne, IN 46845 Tel: (260) 423-4400 Fax: (260) 969-4462 E-mail: dgolden@goldenlaw.biz Total Assets: $1,540,000 Total Liabilities: $953,885 The petition was signed by Fauzia S. Alkhairy, president. A full-text copy of the petition containing, among other items, a list of the Debtor's three unsecured creditors is available for free at: http://bankrupt.com/misc/innb18-10635.pdf AMADO AMADO SALON: Taps Kreston PR as Accountant ------------------------------------------------ Amado Amado Salon & Body, Corp., and Amado Salon de Belleza, Inc., seek approval from the U.S. Bankruptcy Court for the District of Puerto Rico to hire Kreston PR, LLC, as its accountant. The firm will prepare the Debtors' monthly operating reports and tax returns; provide bookkeeping services; and provide other services in connection with their Chapter 11 cases. The firm's discounted hourly rates are: Partner $175 Tax Director $150 Manager $115 Supervisor $95 Auditor $75 Accountant $50 Clerical $35 Kreston PR received a retainer in the sum of $15,000 from the Debtor. Kreston PR and its associates and employees do not have any connection with the Debtors or their creditors, according to court filings. The firm can be reached through: Frank Sanchez Ruiz Kreston PR, LLC P.O. Box 270233 San Juan, PR 00927 About Amado Amado Salon & Body Corp. Amado Amado Salon & Body Corp. and Amado Salon De Belleza, Inc. are privately-held companies in San Juan, Puerto Rico, engaged in the beauty salon business. The Debtors first filed for Chapter 11 bankruptcy protection (Bankr. D.P.R. Case Nos. 14-10459 and 14-10460) on Dec. 23, 2014. The Debtors sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Lead Case No. 18-01144) on March 5, 2018. In the petitions signed by Amado Navarro Elizalde, president, Amado Amado Salon estimated assets and liabilities of $1 million to $10 million. Amado Salon De Belleza estimated assets and liabilities of less than $1 million. Judge Mildred Caban Flores presides over the cases. AMERIFLEX ENG'G: Taps Willamette as Business Valuation Expert ------------------------------------------------------------- Ameriflex Engineering, LLC, seeks approval from the U.S. Bankruptcy Court for the District of Oregon to hire a business valuation expert. The Debtor proposes to employ Willamette Management Associates to conduct a valuation of its business in connection with the formulation of a Chapter 11 plan. The firm will charge these hourly rates: Charles Wilhoite $550 Lisa Tran $325 Connor Thurman $150 Brian Sekafetz $150 Willamette received a retainer from the Debtor in the sum of $15,000. The firm does not hold or represent any interests adverse to the Debtor and its estate. Willamette can be reached through: Charles Wilhoite Willamette Management Associates 111 S.W. Fifth Avenue, Suite 2150 Portland, Oregon, 97204 Phone: 503-243-7500 Email: cawilhoite@willamette.com About Ameriflex Engineering Ameriflex Engineering LLC -- http://rhboats.com/-- and http://fishrite-boats.com/-- is engaged in the design, development and manufacturing of boats. The Company was created in 2008 with the acquisition of the assets of then struggling River Hawk Boats, Inc. Cajon, Inc. and Pacific Diamond & Precious Metals each own 50% membership interest in the Company. Ameriflex Engineering filed a Chapter 11 petition (Bankr. D. Ore. Case No. 17-60837) on March 22, 2017. In the petition signed by Pacific Diamond & Precious Metals, Inc., member, the Debtor estimated assets and liabilities between $1 million and $10 million. The case is assigned to Judge Thomas M. Renn. The Debtor hired Tara J. Schleicher, Esq., at Farleigh Wada Witt, as bankruptcy counsel; Ball Janik LLP as special counsel; and Cramer & Associates as accountant. No trustee, examiner or committee has been appointed. BBL BUILDERS: Court Nixes SPI Objection to Special Master Report ---------------------------------------------------------------- In the case captioned SHELTER PRODUCTS, INC., Appellant, v. 296 SOUTHLAKE, LTD., Appellee, Case No. 4:17-cv-90-JRG (E.D. Tex.), District Judge Rodney Gilstrap adopts the Special Master's Report and Recommendation and overrules Shelter Products' objection to the said report. In November 2013, Appellee 296 Southlake, Ltd. hired BBL Builders, L.P. to serve as the general contractor on a construction project. On Oct. 14, 2016, BBL filed for bankruptcy under Chapter 11 of Title 11 of the Bankruptcy Code. Shortly thereafter, on Nov. 3, 2016, Southlake filed a motion seeking relief from the automatic stay relating to $166,289 that was being held in an escrow account. On Nov. 21, 2016, after the time for filing objections had passed, Shelter Products filed an objection to Southlake's motion to lift the stay. Notwithstanding the untimely objection, the Bankruptcy Court granted Southlake relief from the automatic stay on Nov. 22, 2016. Shelter Products then filed a Motion for Reconsideration, urging the Bankruptcy Court to reconsider its decision granting Southlake relief from the automatic stay. The Bankruptcy Court subsequently denied this motion for reconsideration. On Feb. 6, 2017, Shelter Products filed a notice of appeal indicating that it was appealing the order denying Shelter Product's motion for reconsideration. To expedite the resolution of the dispute between 296 Southlake, Ltd. and Shelter Products, Inc., the Court appointed Jason R. Searcy as Special Master. On March 6, 2018, Mr. Searcy submitted his Report and Recommendation, concluding that the order denying Shelter Product's motion for reconsideration should be affirmed. Mr. Searcy further concluded that any appeal from the underlying order granting Southlake relief from the automatic stay should be dismissed as moot. Mr. Searcy also filed a Motion for Attorney's Fees pursuant to the Court's Order appointing him as Special Master. On March 15, 2018, Shelter Products filed its Objections to the Special Master's Report and Fee Request. In its objections, Shelter Products argues that "[t]he Master utterly failed to deal with the central issues of the appeal." However, Shelter Products points to no specific error in the Special Master's evaluation of its motion to reconsider nor does Shelter Products explain why the Special Master erred in concluding that any appeal from the order granting Southlake relief from the automatic stay is moot. Instead, Shelter Products repeats arguments presented to the Bankruptcy Court, which the Bankruptcy Court already concluded did not justify reconsideration. In sum, nothing in Shelter Products' objections addresses the fundamental flaw with its appeal or its procedural missteps in the Bankruptcy Court. Accordingly, and having conducted a de novo review of the Special Master's factual and legal conclusions, the Court concludes that there was no error in the Bankruptcy Court's order denying reconsideration and that any appeal from its order affecting the temporary stay is moot. Shelter Products also argues that the Special Master's fees are either unreasonable, because Shelter Products "is entitled to a free appeal" and because the rates charged are higher than the rates charged by counsel for Shelter Products, or unwarranted in light of the Special Master's apparent "bias." Having reviewed the record in this case, the Court is not persuaded that the Special Master's fees are unreasonable. Additionally, the Court is not persuaded that the Special Master has or has evidenced any bias in his handling of this case, and thus the Court rejects Shelter Products' suggestion that "bias" justifies rejecting the Special Master's motion for fees. A full-text copy of the Court's March 23, 2018 Order is available at https://is.gd/NEdR8C from Leagle.com. BBL Builders, L.P., Petitioner, represented by Anthony P. Jach -- tjach@njh-law.com -- Nixon, Jach, Hubbard, PLLC. Jason Riley Searcy, Special Master, pro se. Shelter Products, Inc., Appellant, represented by Ben L. Aderholt -- baderholt@coatsrose.com -- Coats Rose, PC. 296 Southlake, Ltd., Appellee, represented by T. Josh Judd -- JJudd@andrewsmyers.com -- Andrews Myers PC & Melissa Richards Smith -- melissa@gillamsmithlaw.com -- Gillam & Smith, LLP. About BBL Builders BBL Builders, L.P., filed a Chapter 11 petition (Bankr. E.D. Tex. Case No. 16-41880) on October 14, 2016, and is represented by Eric A. Liepins, Esq., in Dallas, Texas. At the time of filing, the Debtor had $0 to $50,000 in estimated assets and $10 million to $50 million in estimated liabilities. The petition was signed by Mark Bette, managing member of general partner. A list of the Debtor's 20 largest unsecured creditors is available for free at http://bankrupt.com/misc/txeb16-41880.pdf BEAULIEU GROUP: S. Lightsey Suit Administratively Closed -------------------------------------------------------- District Judge William S. Duffey, Jr. adopts Magistrate Judge Catherine M. Salinas' recommendation that the case captioned SA'QUAN LIGHTSEY, Plaintiff, v. BEAULIEU GROUP, LLC, Defendant, No. 1:16-cv-4292-WSD (N.D. Ga.) be administratively closed pending Defendant Beaulieu Group, LLC's bankruptcy proceedings. A debtor's filing of a petition under the Bankruptcy Code operates as an automatic stay of the "commencement or continuation . . . of a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the case under this title, or to recover a claim against the debtor that arose before the commencement of the case under [the bankruptcy code]." In light of Defendant's Notice of Bankruptcy, Lightsey's action is stayed. The Magistrate Judge recommends administratively closing the action until the stay is lifted. The Court finds no plain error in this finding and recommendation. Accordingly, the action is administratively closed. A copy of Judge Duffey's Opinion and Order dated March 23, 2018 is available at https://is.gd/RmkIG1 from Leagle.com. Sa'Quan Lightsey, Plaintiff, represented by Amelia A. Ragan, Barrett & Farahany, LLP. Beaulieu Group, LLC, Defendant, represented by Peter Norbert Farley -- pfarley@mcguirewoods.com -- McGuire Woods LLP. About Beaulieu Group Founded in 1978 by Carl M. Bouckaert and Mieke D. Hanssens, Beaulieu Group LLC -- http://www.beaulieuflooring.com/-- is a privately owned American company that manufactures and distributes high-end quality products in carpet, engineered hardwood, laminate and luxury vinyl. Beaulieu Group has 2,500 full- and part-time hourly and salaried employees. Beaulieu Group, along with the two other affiliates, filed voluntary petitions seeking relief under the provisions of Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 17-41677) on July 16, 2017. The cases are jointly administered before the Honorable Judge Mary Grace Diehl. Scroggins & Williamson, P.C., is the Debtors' bankruptcy counsel. McGuireWoods is the special corporate counsel and Armory Strategic Partners is the restructuring advisor. American Legal Claim Services, LLC, is the claims and noticing agent. An Official Committee of Unsecured Creditors was appointed on July 21, 2017. The Committee retained Thompson Hine LLP as counsel; Fox Rothschild LLP as co-counsel; and Phoenix Management Services LLC as financial advisor. No trustee or examiner has been appointed in this case. BLACKFOOT CONSTRUCTION: May Use Cash Collateral on Final Basis -------------------------------------------------------------- Judge Robyn L. Moberly of the U.S. Bankruptcy Court for the Southern District of Indiana has signed a final order authorizing Blackfoot Construction Company to use cash collateral. The Debtor contends that it needs use of the cash collateral to continue its operations without interruption. The Debtor represents that it will only use the cash collateral to pay its operating expenses and adequate protection payments specifically outlined on the budget which include tax, and utilities and insurance. The 6-month projection shows total expenses of approximately $632,495 during the months of February through July 2018. The Debtor acknowledges its indebtedness to Swift Financial Corporation in an outstanding aggregate amount of $213,969 as of April 1, 2018, collateralized by valid, enforceable and non-avoidable, first-priority liens and security interests all of the Debtor's personal property including cash collateral. Swift Financial will be granted replacement liens on the cash collateral to the same extent and priority as Swift Financial enjoyed prior to the Petition Date. The Debtor will also pay Swift $3,000 on or before March 15, 2018, and March 30, 2018. Moreover, on April 1, 2018, Swift Financial's secured claim will accrue interest at the rate of 6% per annum. Commencing in April and for 33 months thereafter, the Debtor will pay Swift Financial $6,666.61 per month, due and payable in equal installments on the 15th and 30th of each month. In addition, the Debtor will at all times maintain insurance coverage on the all of the assets of the bankruptcy estate, and will incorporate in any proposed plan of reorganizations the payment terms to Swift Financial provided in the Final Order. A full-text copy of the Final Order is available at http://bankrupt.com/misc/insb17-08448-68.pdf About Blackfoot Construction Blackfoot Construction Company, d/b/a Blackfoot Solutions, owns and operates a construction company located in Noblesville, Indiana. It constructs and maintains cell phone towers and facilities as well as provides installation services to telecommunication providers. It was incorporated on Dec. 9, 2004, in Dyersburg, Tennessee, under different ownership. Its current owner acquired the Debtor in 2007 and started operating the business out of his residence in Fishers, Indiana. It has been located in Noblesville, Indiana since March of 2014. It has 15 employees. Blackfoot Construction Company filed for Chapter 11 bankruptcy protection (Bankr. S.D. Ind. Case No. 17-08448) on Nov. 8, 2017. David R. Krebs, Esq. and John J. Allman, Esq. of Hester Baker Krebs LLC, serve as the Debtor's counsel. No trustee or examiner has been appointed in the Chapter 11 case. No official committee of unsecured creditors has been appointed in the Chapter 11 case. BON-TON STORES: Court Approves 2L Noteholders, Liquidators' Bid --------------------------------------------------------------- The Bon-Ton Stores, Inc., on Wednesday said the U.S. Bankruptcy Court for the District of Delaware has approved an asset purchase agreement between the Company and a joint venture composed of the holders of the Company's 8.0% Second Lien Secured Notes due 2021 and Great American Group, LLC and Tiger Capital Group, LLC. Bon-Ton did not reveal the amount of the Second Lien Noteholders' winning bid. Reuters reports that the winning bid is worth $775.5 million. Under the approved agreement, the joint venture group will acquire the inventory and certain other assets of the Company. The joint venture was the winning bid in an auction held pursuant to Section 363 of the U.S. Bankruptcy Code on April 16-17, 2018. On its Web site, Bon-Ton said it will conduct an orderly wind-down of its operations. "We expect the liquidation process in all Bon-Ton stores to begin shortly. Throughout the store closing sales, our stores, e-commerce and mobile platforms under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates will remain open and serving customers. We will continue to provide more details on our going out of business sales in the near term." Bon-Ton said in a news statement it "is committed to working constructively with the winning bidder to ensure an orderly wind-down of operations that minimizes the impact on associates, customers, vendors and the communities we serve. The Company's stores, e-commerce and mobile platforms under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates will remain open throughout the store closing sales." As reported by the Troubled Company Reporter, Bill Tracy, President and Chief Executive Officer, on Tuesday said, "While we are disappointed by this outcome and tried very hard to identify bidders interested in operating the business as a going concern, we are committed to working constructively with the winning bidder to ensure an orderly wind-down of operations that minimizes the impact of this development on our associates, customers, vendors and the communities we serve. We are incredibly grateful to all of our associates for their dedicated service to Bon-Ton and to our millions of loyal customers who we have had the pleasure to serve as their hometown store for more than 160 years." As reported by the TCR, Bon-Ton Stores on April 9 said it has received a signed letter of intent from an investor group composed of DW Partners, Namdar Realty Group (including its partner Mason Asset Management) and Washington Prime Group, pursuant to which the investor group proposed to acquire the Company as a going concern in a Bankruptcy Court-supervised sale process. DW et al. said in their letter of intent that the proposed Going Concern Transaction consists of: (i) an agreement by the Investor Group to purchase substantially all of the Debtors' assets except for the Industrial Warehouse Lease Agreement dated as of March 5, 2014, for the premises known as Park 70 at West Jefferson, Enterprise Parkway, West Jefferson, Ohio, and all of Debtors' tangible and intangible assets, properties, rights and claims, to the extent owned, leased, licensed, used or held for use in or relating to the operation of the Premises; and (ii) an agreement by AM Retail to purchase the assets related to the West Jefferson, Ohio Premises through a separate agreement. The Investor Group and AM Retail will provide the Debtors, as consideration for the Purchased Assets, no less than: (i) an aggregate purchase consideration sufficient to have a minimum excess availability of 22.5% at closing; and (ii) a minimum aggregate cash payment of no less than $128,000,000 -- as Baseline Bid -- a sufficient portion of which shall be funded into an escrow account to pay fees and expenses (including professional fees) associated with the wind-down of the Debtors' estates after the Closing. The Investor Group conditioned its willingness to proceed further with due diligence and negotiations on the Debtors' agreement to seek Court authority to pay the Investor Group a deposit of $500,000, which will be used only to pay actual, reasonable and documented third-party counsel and consulting fees and expenses. The Court, however, denied Bon-Ton's request to pay the work fee. According to Jon Harris, writing for The Morning Call, the Investor Group did not participate in the auction. The Second Lien Noteholders are funds and accounts managed or advised by these institutions: * Alden Global, LLC; * B. Riley FBR, Inc.; * Brigade Capital Management, LP; * Cetus Capital, LLC; * Contrarian Capital; and * 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, and Wilmington Savings Fund Society, FSB is successor indenture trustee and collateral agent. About The Bon-Ton Stores The Bon-Ton Stores, Inc. (OTCQX: BONT) -- http://www.bonton.com/-- with corporate headquarters in York, Pennsylvania and Milwaukee, Wisconsin, operates 250 stores, which includes nine furniture galleries, in 23 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates. The stores offer a broad assortment of national and private brand fashion apparel and accessories for women, men and children, as well as cosmetics and home furnishings. The Bon-Ton Stores, Inc., and nine affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 18-10248) on Feb. 4, 2018. In the petitions signed by Executive Vice President and CFO Michael Culhane, Bon-Ton Stores disclosed total assets at $1.58 billion and total debt at $1.74 billion. The Bon-Ton Stores tapped Paul, Weiss, Rifkind, Wharton & Garrison LLP as counsel; Young Conaway Stargatt & Taylor, LLP as co-counsel; Joseph A. Malfitano, PLLC, as special counsel; PJT Partners LP as investment banker; AlixPartners LLP as restructuring advisor and AP Services, LLC as financial advisor; and A&G Realty Partners LLC, as real estate advisor; and Prime Clerk LLC, as administrative advisor. Andrew R. Vara, Acting U.S. Trustee for Region 3, on Feb. 15, 2018, appointed seven creditors to serve on the official committee of unsecured creditors in the Chapter 11 case. Counsel for the Official Committee of Unsecured Creditors are Jeffrey N. Pomerantz, Esq., Robert J. Feinstein, Esq., and Bradford J. Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP. An investor group comprised of DW Partners, LP, Namdar Realty Group and Washington Prime Group, Inc., primarily as secured mortgage lender; and AM Retail Group, Inc., who submitted a going concern bid for the Debtors' assets, are represented by John Lyons, Esq., at DLA Piper LLP (US). Co-Counsel to the Ad Hoc Second Lien Noteholder Group are Norman L. Pernick, Esq., J. Kate Stickles, Esq., and Katherine M. Devanney, Esq., at Cole Schotz, P.C.; and Sidney P. Levinson, Esq., Genna L. Ghaul, Esq., Charles S. Wittmann-Todd, Esq., Bruce Bennett, Esq., and Joshua M. Mester, Esq., at Jones Day. Co-Counsel to the DIP Tranche A-1 Documentation Agent, Crystal Financial LLC, are Mark D. Collins, Esq., and Joseph Charles Barsalona II, Esq., at Richards, Layton & Finger, P.A.; and Matthew P. Ward, Esq., at Womble Bond Dickinson (US) LLP; and Jonathan D. Marshall, Esq., and John Ventola, Esq., at Choate Hall & Stewart LLP. Co-Counsel to the Administrative Agent, Bank of America, N.A., are Julia Frost-Davies, Esq., Robert A.J. Barry, Esq., and Amelia C. Joyner, Esq., at Morgan, Lewis & Bockius LLP. Co-Counsel to the Second Lien Trustee, Wells Fargo Bank, N.A. As Indenture Trustee and Collateral Agent for the Debtor's 8.00% Second Lien Senior Secured Notes Due 2021, are Emily Kathryn Devan, Esq., and Luke A. Sizemore, Esq., at Reed Smith LLP. BON-TON STORES: Said to Close Stores in 10 to 12 Weeks ------------------------------------------------------ William Tracy, The Bon-Ton Stores president and chief executive officer, told employees in a letter Tuesday afternoon that the department store company will go out of business and close its stores within 10 to 12 weeks, reports Corrinne Hess of the Milwaukee Business Times, citing reporting on Twitter by Mitch Nolen, a national retail and bankruptcy reporter who has been a contributor to Seeking Alpha. BizTimes relates that, according to Nolen, Tracy's letter says that the court-supervised auction will be held Wednesday, "where we will ask the bankruptcy court to approve the sale of the company's assets and the wind-down of operations." "At the court-supervised auction, we expect a liquidation bid will be determined to be the highest and best offer to maximize value for Bon-Ton's stakeholders. . . . We expect to soon begin an orderly wind-down of operations," Tracy wrote, according to Nolen. "We tried very hard to identify bidders interested in operating Bon-Ton as a going concern, and I am extremely disappointed by this outcome." "Shortly following the court's approval of the asset sale, we will begin our store closures and the liquidation of all inventory. We expect the store closure process to be completed in 10-12 weeks, with the timing of closures varying from store to store," Tracy wrote, according to Nolen. BizTimes also reports that Bon-Ton earlier this month filed a notice with the state of Wisconsin indicating that it would close 12 Wisconsin stores, and its Milwaukee corporate office, if it was not sold to a going-concern buyer. The notice said the company has 717 employees at its downtown Milwaukee corporate office, 243 at the Brookfield Square store, 201 at the Bayshore Town Center store, 191 at the Mayfair Mall store, 180 at the Southridge Mall store, 108 at the Regency Mall store in Racine and 52 at the Shops of Grand Avenue store in downtown Milwaukee. All of those stores would be closed and layoffs are anticipated to begin on June 5, according to the notice. About The Bon-Ton Stores The Bon-Ton Stores, Inc. (OTCQX: BONT) -- http://www.bonton.com/-- with corporate headquarters in York, Pennsylvania and Milwaukee, Wisconsin, operates 250 stores, which includes nine furniture galleries, in 23 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates. The stores offer a broad assortment of national and private brand fashion apparel and accessories for women, men and children, as well as cosmetics and home furnishings. The Bon-Ton Stores, Inc., and nine affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 18-10248) on Feb. 4, 2018. In the petitions signed by Executive Vice President and CFO Michael Culhane, Bon-Ton Stores disclosed total assets at $1.58 billion and total debt at $1.74 billion. The Bon-Ton Stores tapped Paul, Weiss, Rifkind, Wharton & Garrison LLP as counsel; Young Conaway Stargatt & Taylor, LLP as co-counsel; Joseph A. Malfitano, PLLC, as special counsel; PJT Partners LP as investment banker; AlixPartners LLP as restructuring advisor and AP Services, LLC as financial advisor; and A&G Realty Partners LLC, as real estate advisor; and Prime Clerk LLC, as administrative advisor. Andrew R. Vara, Acting U.S. Trustee for Region 3, on Feb. 15, 2018, appointed seven creditors to serve on the official committee of unsecured creditors in the Chapter 11 case. Counsel for the Official Committee of Unsecured Creditors are Jeffrey N. Pomerantz, Esq., Robert J. Feinstein, Esq., and Bradford J. Sandler, Esq., at Pachulski Stang Ziehl & Jones LLP. An investor group comprised of DW Partners, LP, Namdar Realty Group and Washington Prime Group, Inc., primarily as secured mortgage lender; and AM Retail Group, Inc., who submitted a going concern bid for the Debtors' assets, are represented by John Lyons, Esq., at DLA Piper LLP (US). Co-Counsel to the Ad Hoc Second Lien Noteholder Group are Norman L. Pernick, Esq., J. Kate Stickles, Esq., and Katherine M. Devanney, Esq., at Cole Schotz, P.C.; and Sidney P. Levinson, Esq., Genna L. Ghaul, Esq., Charles S. Wittmann-Todd, Esq., Bruce Bennett, Esq., and Joshua M. Mester, Esq., at Jones Day. Co-Counsel to the DIP Tranche A-1 Documentation Agent, Crystal Financial LLC, are Mark D. Collins, Esq., and Joseph Charles Barsalona II, Esq., at Richards, Layton & Finger, P.A.; and Matthew P. Ward, Esq., at Womble Bond Dickinson (US) LLP; and Jonathan D. Marshall, Esq., and John Ventola, Esq., at Choate Hall & Stewart LLP. Co-Counsel to the Administrative Agent, Bank of America, N.A., are Julia Frost-Davies, Esq., Robert A.J. Barry, Esq., and Amelia C. Joyner, Esq., at Morgan, Lewis & Bockius LLP. Co-Counsel to the Second Lien Trustee, Wells Fargo Bank, N.A. As Indenture Trustee and Collateral Agent for the Debtor's 8.00% Second Lien Senior Secured Notes Due 2021, are Emily Kathryn Devan, Esq., and Luke A. Sizemore, Esq., at Reed Smith LLP. BRAVE PARENT: Moody's Assigns B3 CFR & Rates $265MM Loans B2 ------------------------------------------------------------ Moody's Investors Service assigned to Brave Parent Holdings, Inc. ("Bomgar") a B3 Corporate Family Rating (CFR), B3-PD Probability of Default Rating, a B2 rating to its proposed $240 million senior secured first-lien term loan and a B2 rating to its proposed $25 million senior secured first-lien revolving credit facility. The ratings outlook is stable. Proceeds from the first-lien debt issuance, as well as from a $95 million (unrated) second-lien term loan will be used to finance the acquisition of Brave Parent Holdings, Inc. by funds affiliated with Francisco Partners. Brave Parent Holdings, Inc. is the debt issuing holding company that owns remote support and privileged access management software provider, Bomgar Corporation. Assignments: Issuer: Brave Parent Holdings, Inc. Corporate Family Rating, Assigned B3 Probability of Default Rating, Assigned B3-PD Gtd Senior Secured First-Lien Term Loan, Assigned B2 (LGD3) Gtd Senior Secured First-Lien Revolving Credit Facility, Assigned B2 (LGD3) Outlook, Stable RATINGS RATIONALE The B3 CFR broadly reflects Bomgar's very high initial leverage, limited historical financial data, and small scale. These risks are offset to some degree by the company's strong free cash flow generation and expectations of revenue and EBITDA growth in the high-single digit to low-double digit percent range over the next 12 to 18 months. Revenue growth will be driven by continued adoption of secure remote support and privileged access management applications in enterprise IT organizations as these solutions are increasingly recognized as integral components of an organizations overall IT security and risk management strategy. Debt-to-EBITDA, pro forma for the LBO transaction is estimated to be in excess of 10x (or about 7.8x when adjusted for the change in deferred revenue) for the year ended December 31, 2017 but is expected to decline to below 7.5x over the next 12-18 months. Recurring revenues, defined as maintenance contract and subscription contract derived revenues currently represent approximately 60% of total revenue, but will increase as a proportion of total revenues as the company continues to grow organically. Bomgar, though very small in scale, is a leading player in sub-segments of the remote access and identity and access management markets where the company competes against much larger and better capitalized providers. Bomgar has seen strong traction in the market however, with organic revenue growth rates in excess of 10% and net revenue retention rates in excess of 100%. Bomgar is private equity owned and is expected to be acquisitive, and over time, debt funded acquisition or dividend activity could result in persistently high leverage levels, or could introduce integration and sales execution risk which could hamper growth. The stable ratings outlook is based on Moody's expectation that over the next 12-18 months, Bomgar will be on track to reduce debt-to-EBITDA to below 7.5x and will maintain organic revenue growth in at least the mid- to high-single digit percent range. Absent any debt-financed acquisition or dividend activity, Moody's could upgrade Bomgar if the company were to continue to grow profitably, enhance scale as measured by revenue, and sustain debt-to-EBITDA below 6x while maintaining healthy positive free cash flow. Moody's could downgrade Bomgar if revenues declined as a result of competitive or pricing pressure such that debt-to-EBITDA were sustained above 8x or interest coverage weakened. The ratings could also be downgraded if liquidity were to deteriorate. We expect Bomgar to maintain a good liquidity profile over the next 12 months, supported by positive free cash flow, an expected $8 million cash balance at the close of the transaction and access to a $25 million undrawn committed revolving credit facility. The revolving credit facility contains a springing first-lien net leverage ratio (based on bank consolidated EBITDA) set at 8.0x which is tested quarterly when the facility is 30% or more drawn. The principal methodology used in these ratings was Software Industry published in December 2015. Bomgar Corporation, the operating subsidiary of debt issuing parent Brave Parent Holdings, Inc., is a provider of Privileged Access Management and Remote Support software solutions and services to enterprise clients. Bomgar provides software solutions via cloud, virtual appliance, and physical appliance platforms. The company is owned by funds affiliated with Francisco Partners and management. Bomgar generated pro forma revenues of approximately $104 million in the year ended December 31, 2017. BRIDGEHAMPTON STONE: Taps S Kekatos & Associates as Accountant -------------------------------------------------------------- Bridgehampton Stone Inc. received approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire S Kekatos & Associates LLC as its accountant. The services to be provided by the firm include advising the Debtor regarding its financial affairs; cash flow monitoring and reporting; preparation of monthly operating reports; assistance with the development of various aspects of the Debtor's plan of reorganization; and acting as a liaison with creditor groups. The firm will charge an hourly fee of $150. S Kekatos is "disinterested" as defined in Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Spyros Kekatos S Kekatos & Associates LLC 22-76 Steinway Street Astoria, NY 11105 Tel: 718-721-7111 Fax: 718-721-5988 Email: spyrok@kekatosassociates.com About Bridgehampton Stone Bridgehampton Stone Inc. is a general contractor based in Astoria, New York. Bridgehampton Stone sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 18-40385) on Jan. 24, 2018. In the petition signed by Daniel Messina, president, the Debtor estimated assets and liabilities of less than $50,000. Judge Elizabeth S. Stong presides over the case. The Debtor hired Morrison-Tenenbaum, PLLC, as its legal counsel. BRM HOME: Gets Interim Approval to Hire Greg Murray as CRO ---------------------------------------------------------- BRM Home Health, PLLC, received interim approval from the U.S. Bankruptcy Court for the Western District of Texas to hire Greg T. Murray, PLLC and appoint Greg Murray as its chief restructuring officer. Mr. Murray and his firm will manage the financial operations of BRM and its affiliates and will assist in coordinating their business operations during the course of their Chapter 11 cases. Specifically, the services to be provided by the firm include preparing the Debtors' cash flow forecast; examining the Debtors' operations to determine whether additional cost reductions can be achieved; reviewing their current accounting reports; and participating in meetings regarding restructuring the Debtors' obligations to creditors. The firm will charge $275 per hour for services provided by Mr. Murray as CRO, plus work-related expenses. It has agreed to cap its monthly payment for fees and expenses at $15,000. The firm holds a retainer in the sum of $4,940. Mr. Murray disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Greg T. Murray Greg T. Murray, P.L.L.C. 1503 Tarton Lane San Antonio, TX 78231 Phone: (210) 413-9162 Fax: (210) 492-6389 E-mail: greg@gregmurraycpa.com About BRM Home Health BRM Home Health, PLLC and its affiliates are Texas-based home health care and hospice care agencies that provided skilled nursing to patients receiving care through Medicare, Medicaid, as well as private insurers. BRM also owns a real property at 2900 Mossrock, San Antonio, Texas, where it maintains corporate offices and leases to third party tenants. The Debtors sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Lead Case No. 18-50678) on March 28, 2018. In the petitions signed by Rodney Mesquias, manager, BRM Home Health disclosed that it had estimated assets and liabilities of $1 million to $10 million. Judge Craig A. Gargotta presides over the cases. Pulman, Cappuccio, Pullen, Benson & Jones, LLP is the Debtors' legal counsel. CAPSTONE LOGISTICS: Moody's Alters Outlook to Stable & Affirms CFR ------------------------------------------------------------------ Moody's Investor's Service affirmed ratings for Capstone Logistics Acquisition, Inc. including the B3 Corporate Family Rating (CFR) and the B3-PD Probability of Default rating. Concurrently, Moody's affirmed the B2 rating on the first lien senior secured term loan as well as the Caa2 rating on the second lien senior secured credit facility. Moody's also assigned a B2 rating to the new first lien senior secured revolver. The B2 rating on the existing first lien senior secured revolver will be withdrawn upon close. The rating outlook has been changed to stable from negative. RATINGS RATIONALE The stable outlook reflects Moody's expectations that Capstone will generate modest sales growth along with a generally stable operating performance during 2018. The outlook also incorporates our expectation that headwinds stemming from the Pinnacle acquisition of 2015 will begin to moderate over the next 18 months, although we believe these earnings pressures will remain in place for at least the balance of 2018. The stable outlook is based on Moody's expectation that Capstone will receive lender approval for its pending amendment. The B3 Corporate Family Rating considers Capstone's small size, weak credit metrics, and elevated financial leverage. Capstone's overall operating performance continues to underperform relative to expectations mainly due to headwinds from the Pinnacle business. These pressures have resulted in earnings headwinds and elevated financial leverage with Moody's adjusted Debt-to-EBITDA of around 6.5x as of December 2017. This underperformance to expectations is against a backdrop of a tightening labor market which raises the prospect of additional margin pressures in the form of higher labor costs. The rating also incorporates Capstone's exposure to large customers which leaves the company vulnerable to pricing pressures as demonstrated by a marked weakening of margins, with 2017 adjusted EBITDA margins of 12% comparing to adjusted EBITDA in the high-teens as recently as 2015. Furthermore, Capstone's sales concentration in the unloading business (unloading is about 70% of sales) creates vulnerabilities to disintermediation risks such as the increased use of automation over the longer-term. These considerations are tempered by the company's good standing as a leading provider of outsourced labor solutions to its well-established and long-standing customer base. The rating also considers Capstone's exposure to grocery, food service and retail end markets, verticals that Moody's views as being relatively recession resistant with stable demand drivers. Moody's expects Capstone to maintain an adequate liquidity profile over the next 12 months. Cash balances are comparatively small ($18 million as of December 2017) as is mandatory amortization on term debt ($3 million per annum). Moody's said, "We anticipate continued, albeit modest, free cash flow generation and expect FCF-to-Debt in the low single-digits during 2018. External liquidity is provided by a $50 million revolver (expected to be reduced to $45 million as part of the pending amendment) that expires in October 2019 (expected to be extended to April 2021 as part of the pending amendment). The company is heavily reliant on the facility to provide L/C's for workers compensation ($24 million of LC'S as of December 2017) leaving $26 million of availability as of December 2017. The revolver and first lien term facilities contain a maintenance-based first lien net leverage ratio of 6.25x (steps down to 5.5x in Q1 2019). The company is currently seeking lender approval to loosen the ratio to 6.95x during 2018 with subsequent stepdowns in 2019 which would provide adequate cushioning. We note this is the second such amendment from the lending group (previous was in February 2016). Absent the completion of the pending amendment, compliance with financial covenants will be tenuous over the coming quarters." The ratings could be upgraded if Debt-to-EBITDA was expected to be sustained below 5.75x. Any upgrade would be contingent upon a good liquidity profile involving consistently positive free cash generation along with considerable availability under the revolving credit facility. A demonstrated ability to stabilize and expand margins would also be an important consideration for any upgrade. The ratings could be downgraded if Debt-to-EBITDA was expected to be sustained above 7.0x or if EBITDA margins were anticipated to remain in the low double-digits. A weakening liquidity profile characterized by negative free cash flows, or increased reliance on the revolver, or an anticipated breach of financial covenants would also likely result in a downgrade. An inability to amend existing financial covenants or extend the maturity of the revolver could crate downward rating pressure. Issuer: Capstone Logistics Acquisition, Inc. The following ratings were affirmed: Corporate Family Rating, affirmed B3 Probability of Default Rating, affirmed B3-PD Senior Secured first lien term loan, affirmed B2 (LGD3) Senior Secured second lien term loan, affirmed Caa2 (LGD5) The following ratings were assigned: Senior Secured first lien revolver due 2021, assigned B2 (LGD3) Outlook Actions: Outlook, changed to Stable from Negative Capstone Logistics Acquisition, Inc. is a supply chain solutions provider offering managed outsourced labor to owners of distribution centers for non-core labor-intensive operations. Capstone is owned by funds managed by The Jordan Company L.P. which acquired the company in August 2014. Capstone maintains headquarters in Norcross, Georgia. Revenues for the twelve months ended December 2017 were about $520 million. COMMUNITY CHOICE: S&P Lowers ICR to 'CC', Outlook Negative ---------------------------------------------------------- S&P Global Ratings said it lowered its issuer credit rating on Community Choice Financial Inc. (CCFI) to 'CC' from 'CCC'. The outlook is negative. S&P said, "At the same time, we lowered our issue-level rating on the company's senior secured notes to 'CC' from 'CCC'. The recovery rating on the notes remains '4' reflecting our expectations for average recovery (30%-50%; rounded estimate: 35%) in the event of a default. "The downgrade follows the company's amended revolver and subsidiary note payable on March 30, 2018 -- both of which require CCFI to make a proposal to restructure its senior secured notes, which, if completed, we would likely view as a selective default. "We would likely view this transaction as a distressed exchange, because we expect participating noteholders will receive less than the original amount promised, further demonstrated by the notes' recent decline in price to roughly 65 cents on the dollar and the company's negative EBITDA in 2017. "The negative outlook reflects our expectation over the next six months that CCFI will likely selectively default on its senior secured notes due 2019 and 2020 following the company's amendment to a revolver and subsidiary note payable that requires the company to submit a plan to renegotiate the senior secured notes. "If we lower the issuer credit rating to 'SD', we will evaluate the company's new capital structure and viability of a path to return to profitability following the distressed exchange." COMMUNITY MEMORIAL: S&P Lowers Rating on 2011 Bonds to 'BB' ----------------------------------------------------------- S&P Global Ratings lowered its long-term rating to 'BB' from 'BB+' on Ventura, Calif.'s series 2011 bonds, issued for Community Memorial Health System (CMHS). The outlook is stable. "The downgrade reflects our view of CMHS' weakened operating performance, including further expected pressures to both earnings and unrestricted services as CMHS moves into its new patient tower later this year," said S&P Global Ratings credit analyst Melanie Her. "We view this weakness in financial performance and unrestricted reserves during a period where CMHS will undergo ramp-up costs associated with its new tower as bringing additional risk to the already vulnerable financial profile," Ms. Her added. The project is a 250-bed, six-story building, with additions to neonatal, coronary, the intensive care unit, and pediatric areas. In addition, the emergency room nearly doubled, and CMHS added two surgery suites and two catheter labs. S&P expects the new facility to help drive volume growth given the additional capacity. CONSTELLATION ENTERPRISES: Dismissal of Committee Appeals Affirmed ------------------------------------------------------------------ Appellant, the former Official Committee of Unsecured Creditors of Constellation Enterprises LLC and nine related companies in the appeals cases captioned OFFICIAL COMMITTEE OF UNSECURED CREDITORS, Appellant, v. CONSTELLATION ENTERPRISES LLC, OFFICE OF THE UNITED STATES TRUSTEE, REPRESENTATIVE CLAIMANT, TREVOR MILLER, DDTL PARTIES, UNITED STATES, Appellees, Civ. Nos. 17-757-RGA, 17-1430-RGA, 17-276-RGA (D. Del.) appealed the Bankruptcy Court's denial of a settlement approval motion and the Bankruptcy Court's order granting Debtors' motion to convert their chapter 11 cases to cases under chapter 7. The Committee also filed a motion for stay of the Conversion Order pending appeal. Appellees, the United States Trustee and the DDTL Parties have each moved to dismiss the appeals. District Judge Richard G. Andrews dismisses both appeals and dismisses the motion to stay. Because the Debtors' chapter 11 cases have now been converted to cases under chapter 7, Appellees argue that the Committee has automatically dissolved, and the appeals must be dismissed. Appellees argue that, upon conversion, the legal entity that was the Committee ceased to exist; therefore, it had no authority to appeal the Conversion Order, and, as the sole appellant of the Settlement Denial Order, no longer has the authority or power to continue its appeal of that order either. According to the Trustee, numerous courts and commentators agree that a chapter 11 committee terminates upon conversion to chapter 7. Moreover, continued existence post-conversion as proposed by the Committee would raise a host of practical issues not addressed at all by the Bankruptcy Code and Bankruptcy Rules. Conversely, the Committee argues that section 348 of the Bankruptcy Code, which governs the effect of conversion, does not provide for the automatic termination of the Committee nor for the loss of its rights. The Committee argues that Bankruptcy Code is silent as to the effect of conversion on the rights and duties of a creditors' committee and that case law has implicitly recognized the right of a committee to continue an appeal post-conversion. The Court agrees that the legal entity that was the Committee automatically dissolved and ceased to exist as of the conversion of the chapter 11 cases to chapter 7. An official committee of unsecured creditors is created when appointed by the Trustee under section 1102 of the Bankruptcy Code, and it exists only under the framework of chapter 11. The Committee argues that conversion does not mandate its dissolution nor any forfeiture of its rights in the appeal of the Settlement Denial Order. The Committee argues it may continue to exist post-conversion, not "to exercise plenary powers" under the Bankruptcy Code, but rather "to exercise vested rights." In support of this argument, the Committee "urges this Court to follow the First Circuit's adjudication of SPM' and "adopt a rule that permits a creditors' committee to retain its vested legal and property rights following conversion, and [c]ontinue with an appeal properly perfected prior to the act of conversion." In SPM, the First Circuit resolved an appeal pursued by a chapter 11 committee post-conversion. Importantly, no party moved to dismiss the appeal based on the conversion of the debtor's case and the dissolution of the committee. The issue of whether the creditors' committee in that case had survived the conversion was not raised, argued, or discussed. According to the Trustee, the fact that the issue passed sub silentio through the First Circuit provides no support for the notion that a creditors' committee survives conversion. The Court agrees with the Trustee. In sum, a creditors' committee exists only under the statutory framework of the Bankruptcy Code. When these cases converted, the chapter 11 order for relief became an order for relief under chapter 7, the statutory predicate for the existence of Committee no longer applied, and the Committee automatically dissolved. As the Committee has dissolved, it has no capacity or authority to appear before this Court, including filing the notice of appeal of the Conversion Order and any filings made in further prosecution of the appeal of the Settlement Denial Order. Because the Committee has no capacity to pursue these appeals, and there is no co-appellant to pursue these appeals, the appeals must be dismissed. Accordingly, the Court dismisses the Motion for Stay Pending Appeal as moot. A full-text copy of the Court's Memorandum dated March 22, 2018 is available at https://is.gd/4ydQGw from Leagle.com. Constellation Enterprises LLC, et al., Debtor, represented by Alan M. Root -- aroot@archerlaw.com -- Archer & Greiner, P.C. Official Committee of Unsecured Creditors, Appellant, represented by Christopher M. Samis -- csamis@wtplaw.com -- Whiteford, Taylor & Preston, L.L.C., David R. Kuney -- dkuney@wtplaw.com -- Whiteford, Taylor & Preston LLP, pro hac vice, Kevin F. Shaw -- kshaw@wtplaw.com -- Whiteford, Taylor & Preston, L.L.C., Leslie Katherine Good , Whiteford, Taylor & Preston, L.L.C., Nava Hazan -- nava.hazan@squirepb.com -- Squire Patton Boggs LLP, pro hac vice & Norman N. Kinel -- norman.kinel@squirepb.com -- Squire Patton Boggs (US) LLP, pro hac vice. Constellation Enterprises LLC, et al., Appellee, represented by Daniel J. DeFranceschi -- defranceschi@rlf.com -- Richards, Layton & Finger, PA, Joseph Charles Barsalona, II -- barsalona@rlf.com -- Richards, Layton & Finger, PA & Zachary I. Shapiro -- shapiro@rlf.com -- Richards, Layton & Finger, PA. Andrew R. Vara, Appellee, represented by Sumi K. Sakata, U.S. Department of Justice Executive Office for the United States Trustees. About Constellation Enterprises Constellation Enterprises LLC manufactures custom engineered metal components for various end markets such as rail transportation, oil and gas, general industrial, nuclear, aerospace, and small gas engine markets. The company was incorporated in 1996 and is based in Caldwell, Texas. Constellation Enterprises and its affiliates filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Lead Case No. 16-11213) on May 16, 2016. William Lowry, chief financial officer, signed the petitions. Constellation Enterprises estimated assets between $1 million and $10 million and debt between $100 million and $500 million. Adam C. Rogoff, Esq., and Joseph A. Shifer, Esq., at Kramer Levin Naftalis & Frankel LLP serve as the Debtors' bankruptcy counsel. Daniel J. DeFranceschi, Esq., Zachary I. Shapiro, Esq., Rachel L. Biblo, Esq., and Joseph C. Barsalona II, Esq., at Richards, Layton & Finger, P.A., serve as the Debtors' co-counsel. Imperial Capital, LLC, is the Debtors' financial advisor. Conway Mackenzie Management Services LLC is the Debtors' crisis management & restructuring services provider. Epiq Bankruptcy Solutions, LLC, is the Debtors' claims and noticing agent. COOK INVESTMENTS: Trustee Bid to Stay Judgment Pending Appeal Nixed ------------------------------------------------------------------- Appellant in the case captioned GREGORY M. GARVIN, Acting United States Trustee for Region 18, Appellant, v. COOK INVESTMENTS NW, SPNWY, LLC., et al., Appellees, Case No. 17-5516 BHS (W.D. Wash.) filed a motion to stay judgment pending appeal. After considering the pleadings filed in support of and in opposition to the appeal, District Judge Benjamin H. Settle enters an order denying the motion. On June 21, 2017, the bankruptcy court confirmed Debtors Cook Investments NW, SPNWY, LLC second amended plan. On July 27, 2017, the Trustee filed a motion to stay the confirmation pending appeal arguing that "section 1129(a)(3) of the Bankruptcy Code prohibits the confirmation of a chapter 11 plan that invites the violation of federal criminal law" and that courts of equity should not be used to "facilitate illegal conduct." On August 24, 2017, the District Court denied the motion concluding, in part, that the Trustee had failed to establish a likelihood of success on the merits. On Dec. 18, 2017, the Court affirmed the bankruptcy court. In relevant part, the Court rejected the Trustee's broad interpretation of section 1129(a)(3) that bankruptcy courts should refuse to confirm plans that "envision" or "perpetuate" illegal activity. Instead, the Court concluded that section 1129(a)(3) precludes plans that depend upon illegal activity. On Feb. 15, 2018, the Trustee filed the instant motion requesting a stay of the judgment while it contemplates an appeal. On Feb. 26, 2018, the Debtors responded arguing that the motion is not timely and that it otherwise fails on the merits. In this case, the Debtors argue that the Trustee's motion is untimely because Fed. R. Bankr. P. 8025(b) is intended only to provide additional time to contemplate an appeal. Now that the Trustee has appealed, the Debtors argue that the motion for a stay is moot. The Court is unaware of, and the Trustee has failed to provide, any authority for the proposition that the Court has either the explicit or inherent authority to alter the status quo pending appeal. It is undisputed that the parties are currently performing obligations under the Plan. In the absence of either binding or persuasive authority, the Court declines the Trustee's invitation to interpret Rule 8025(b) such that the Court may alter the status quo after an appeal has been filed. Therefore, the Court concludes that the Trustee's motion to alter the status quo after an appeal has been filed is untimely. The question of whether a stay pending appeal is warranted requires consideration of four factors: "(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies." In this case, the Trustee has failed to show that he is likely to succeed on the merits. First, the Trustee is the party pursuing a novel and expansive interpretation of the relevant statute. The Court has rejected both attempts by the Trustee to expand the scope of the bankruptcy code. Nothing in the current briefing shows that the Trustee is likely to be successful on appeal. Second, the Trustee relies on a new, third position to establish a likelihood of success on the merits. The Trustee has identified language in the Plan agreement that requires the commingling of monthly rents from the legal business and the illegal marijuana business. Basically, all the Debtors' income must be deposited in one bank account with the Bank. Although the Trustee fails to explain how this provision undermines the Court's conclusion that the Plan does not depend on the marijuana-related income, this provision strengthens the Trustee's argument that the Debtors are grossly mismanaging the estate. The main problem, however, is that the Trustee has presented this argument for the first time in this motion. Given the untimeliness and the possibility that the Trustee may have waived the gross mismanagement issue, the Court finds that the Trustee has failed to show a likelihood of success on the merits on appeal. Thus, the Trustee has failed to meet its burden to obtain a stay. A full-text copy of the Court's Order dated March 26, 2018 is available at https://is.gd/ZvISb2 from Leagle.com. Gregory M Garvin, Acting United States Trustee for Region 18, Appellant, represented by James D. Perkins, USDOJ, UNITED STATES TRUSTEE PROGRAM, Hilary Bramwell Mohr -- hilary.b.mohr@usdoj.gov -- US TRUSTEE'S OFFICE & Thomas Buford -- thomas.a.buford@usdoj.gov -- US TRUSTEE'S OFFICE. Cook Investments NW, SPNWY, LLC, Cook Investments NW, FERN, LLC, Cook Investments NW, LLC, Cook Investments NW, DARR, LLC & Cook Investments NW, ARL, LLC, Appellees, represented by James Leslie Day -- jday@bskd.com -- BUSH STROUT & KORNFELD & Katriana L. Samiljan -- ksamiljan@bskd.com -- BUSH STROUT & KORNFELD LLP. Bankruptcy Appeals, Interested Party, pro se. About Cook Investments NW, SPNWY Cook Investments NW, SPNWY, LLC and four of its affiliates filed Chapter 11 bankruptcy petitions (Bankr. W.D.WA. Lead Case No. 16-44782) on November 21, 2016. The petitions were signed by Michael Cook, sole member. In its petition, Cook Investments NW, SPNWY estimated $1 million to $10 million in both assets and liabilities. Judge Brian D. Lynch presides over the cases. Bush Kornfeld LLP represents the Debtors as counsel. DANCING WATERS: Brokers Ask Court to Approve Employment ------------------------------------------------------- Cushman & Wakefield and CBRE, Inc., have asked the U.S. Bankruptcy Court for the Western District of Washington to approve the employment of both firms as real estate brokers for Dancing Waters LLC. The court had previously approved the employment of both firms in connection with the sale of a 125-acre land known as Governor's Point located in Whatcom County. According to the firms' attorney Benjamin Ellison, Esq., at DBS Law, there is no requirement to further authorize the employment of the firms in light of the court's previous order. "However, out of an abundance of caution, the real estate brokers seek the contingent nunc pro tunc remedy to resolve any defects identified in their present status as court professionals," Mr. Ellison said. A copy of the agreements between the Debtors and the firms detailing the terms of compensation is available for free at http://bankrupt.com/misc/wawb15-13216-456_EXH.pdf Cushman can be reached through: Dave Magee Cushman & Wakefield 1420 Fifth Avenue, Suite 2600 Seattle, WA 98101 Direct: (206) 521-0267 Office: (206) 682-0666 Fax: (206) 521-0298 Email: Dave.Magee@comre.com About Dancing Waters Dancing Waters, LLC, sought Chapter 11 protection (Bankr. W.D. Wash. Case No. 15-13216) on May 22, 2015. Judge Timothy W. Dore is assigned to the case. In the petition signed by Roger Sahlin, manager, the Debtor estimated assets and liabilities in the range of $1 million to $10 million. The Debtor tapped James L. Day, Esq., at the Bush Strout & Kornfeld LLP, as counsel. DATACONNEX LLC: Has Authorization to Use Cash Collateral -------------------------------------------------------- The Hon. Catherine Peek McEwen of the U.S. Bankruptcy Court for the Middle District of Florida has entered an agreed order authorizing DataConnex, LLC to use cash collateral to pay: (a) amounts expressly authorized by the Court, including payments to the U.S. Trustee for quarterly fees; (b) the current and necessary expenses set forth in the budget attached to the Motion, plus an amount not to exceed 10% for each line item; (c) the court-approved amount of $89,163.56 to utility provider Telepak Networks, Inc. d/b/a Cspire; and (d) adequate assurance payments to the Secured Creditor Heritage Bank. Specifically, the Debtor will pay to Heritage Bank the amount of $50,000. In addition, the Debtor will pay adequate protection to Heritage Bank in the amount of $50,000 per month or 50% of the Debtor's collected receivables for the prior month, whichever amount is greater. In addition, the Debtor will grant Heritage Bank access to its business records and premises for inspection. Likewise, the Debtor will maintain insurance coverage for its property in accordance with the obligations under the loan and security documents with Heritage Bank. Each creditor with a security interest in cash collateral is granted a perfected post-petition lien against cash collateral to the same extent and with the same validity and priority as their pre-petition lien. A full-text copy of the Agreed Order is available at http://bankrupt.com/misc/flmb18-01069-49.pdf About DataConnex, LLC Dataconnex, LLC -- http://dataconnex.com/-- is a privately held company in Brandon, Florida that offers advanced telecommunication solutions, from internet and data to voice services. DataConnex was founded to meet the needs of small to medium size businesses, with three offices throughout the Southeast. Dataconnex, LLC, based in Brandon, FL, filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 18-01069) on Feb. 14, 2018. In the petition signed by William R. Blahnik, manager, the Debtor disclosed $4.18 million in assets and $19.07 million in liabilities. Samantha L. Dammer, Esq., at Tampa Law Advocates, P.A., serves as bankruptcy counsel to the Debtor. Harris Wiltshire & Grannis LLP, is the special counsel. DC DOORS: Court OK's First Amended Disclosure Statement ------------------------------------------------------- Judge S. Martin Teel, Jr. of the U.S. Bankruptcy Court for the District of Columbia issued an order approving DC Doors, Inc.'s first amended disclosure statement to accompany its first amended chapter 11 plan. May 16, 2018, at 10:30 a.m., is fixed as the date and time for the hearing on confirmation of the Plan. May 7, 2018, is fixed as the last day on which the holders of claims and interests may accept or reject the Plan, the last day for filing and serving written objections to confirmation of the Plan. The Amended Plan provides for the payment in full of administrative and tax claims, as well as making distributions on account of general unsecured claims equal to a total of 15% of the allowed amount of such claims, over a two-year period following approval of the Plan. With respect to the secured debt, it will be paid in full when the Plan becomes effective. All payments will come from the Debtor's receipts (grants, donations, etc.) from the operation of the Debtor's business. A full-text copy of the Amended Plan is available at: http://bankrupt.com/misc/dcb17-00138-49.pdf A full-text copy of the original Plan is available at: http://bankrupt.com/misc/dcb17-00138-39.pdf About DC Doors DC Doors filed a Chapter 11 bankruptcy petition (Bankr. D.D.C. Case No. 17-00138) on March 1, 2017. The Law Offices of Jeffrey M. Sherman serves as bankruptcy counsel. The Debtor's assets and liabilities are both below $1 million. DERRICK PUGH: U.S. Trustee Unable to Appoint Committee ------------------------------------------------------ No official committee of unsecured creditors has been appointed in the Chapter 11 case of Derrick Pugh, Inc. as of April 16, according to a court docket. About Derrick Pugh Derrick Pugh, Inc., is a trucking and transport company in Lithonia, Georgia that transports goods, cargo, and other commercial, agricultural, industrial, and construction products. Established in 1997, the Company has all kinds of transport equipment including framed trailers, asphalt tankers, and tandem dump trucks. Derrick Pugh filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 18-54668) on March 19, 2018. In the petition signed by Derrick Pugh, president, the Debtor disclosed $1.45 million in total assets and $1.38 million in total liabilities. The case is assigned to Judge Paul Baisier. Will B. Geer, Esq., at Wiggam & Geer, LLC, is the Debtor's counsel. DGS REALTY: May Use Ocwen Cash Collateral Until May 31 ------------------------------------------------------ Judge Bruce A. Harwood of the U.S. Bankruptcy Court for the District of New Hampshire authorized DGS Realty, LLC, to use the cash collateral of Ocwen Loan Servicing, LLC in the ordinary course of its business. DGS Realty is permitted to use and expend the proceeds of cash collateral to pay the costs and expenses incurred in the ordinary course of its business during the period from April 1, 2018 through May 31, 2018 or the date on which the Court enters an order revoking DGS Realty's right to use cash collateral in accordance with the budget. The cash collateral budget provides total monthly cash payout of $10,405.55. Ocwen is granted a post-petition replacement lien and security interest in all post-petition property of the estate of the same type against which Ocwen held validly perfected and not avoidable liens and security interests as of the Petition Date, and the cash proceeds thereof, to the extent that such a lien or security interest is not otherwise extended under Section 552(b)(2). The replacement lien will maintain the same priority, validity and enforceability as such liens on the cash collateral, but will be recognized only to the extent of any diminution in the value of the collateral resulting from the use of cash collateral pursuant to the Order. DGS Realty will timely file monthly operating reports during this case through the Court's electronic filing system and provide Ocwen with a copy. DGS Realty will pay Ocwen its monthly mortgage payment of $6,745.55, each month. These payments will be the normal mortgage payments and loan payments going forward, which will continue pending further order of the Court. DGS Realty will provide Ocwen or its authorized agents with access to the Properties for the purposes of physically inspecting or appraising the same upon Ocwen's reasonable notice and request therefore and a copy of the appraisal will be provided to DGS Realty. A hearing on DGS Realty's continued use of cash collateral will be held on May 30, 2018 at 2:00 p.m. the Debtor will file and serve a motion requesting such use by May 16 and objections to the final approval of the Motion must be filed and served by May 23. A full-text copy of the Order is available at: http://bankrupt.com/misc/nhb18-10024-35.pdf About DGS Realty Based in Concord, New Hampshire, DGS Realty, LLC, is a real estate limited liability company. Formed around May 10, 2017, the company is owned by David H. Booth, Manager, Stephen W. Booth, and Gregory A. Booth, each having a 1/3 interest. The company is an affiliate of Walter H. Booth Clause 4 Trust, which sought bankruptcy protection (Bankr. D.N.H. Case No. 16-11598) on Nov. 16, 2016. DGS Realty filed a Chapter 11 petition (Bankr. D.N.H. Case No. 18-10024) on Jan. 11, 2018. In the petition signed by David H. Booth, the Manager, the Debtor estimated assets and debts between $1 million and $10 million. Representing the Debtor is Eleanor Wm Dahar, Esq., at Victor W. Dahar Professional Association. DOUGLAS JEFFERIES: Court's Dismissal of Chapter 11 Case Remains --------------------------------------------------------------- Judge S. Martin Teel, Jr. of the U.S. Bankruptcy Court for the District of Columbia denied Debtor Douglas George Jefferies' emergency motion for reconsideration seeking to have the court vacate the chapter 11 case dismissal order. The court dismissed the bankruptcy case captioned n re DOUGLAS GEORGE JEFFERIES, Chapter 11, Debtor, No. 18-00099 (Bankr. D.D.C.) based on failure of the debtor to comply with the prepetition credit counseling requirement of 11 U.S.C. section 109(h)(1). The Debtor's motion seeks to have the court vacate the dismissal order by requesting, under 11 U.S.C. section 109(h)(3)(A), that the debtor be permitted to file a certificate of having obtained credit counseling on March 10, 2018, 23 days after the commencement of the case, in lieu of filing a certificate of prepetition credit counseling. The debtor contends that his attention deficit disorder could be deemed to fall within the term "exigent circumstances" under 11 U.S.C. section 109(h)(3)(A)(i). "The word 'exigent' refers to something that is 'urgent' or that requires 'immediate action or aid.'" The debtor's attention deficit disorder may explain why he did not obtain prepetition credit counseling, but it was not itself an exigent circumstance requiring urgent or immediate action, and does not explain why the debtor needed to file bankruptcy when he did. The debtor also argues that his disability makes him a "qualified individual with disability" under the Americans with Disabilities Act and that the court is thus required to provide him with "reasonable accommodation," that is, "reasonable modifications to rules, policies, or practices," including in judicial proceedings. Accordingly, he argues, "reasonable accommodation" requires the court to grant the debtor enough leeway to allow this case to proceed, particularly in light of the lack of harm to any other party in the case. However, the Americans with Disabilities Act does not authorize a court to modify statutory requirements such as those contained in 11 U.S.C. section 109(h). A copy of Judge Teel's Memorandum Decision and Order dated March 21, 2018 is available at https://is.gd/tOE8XV from Leagle.com. Douglas George Jefferies, Debtor In Possession, represented by Kenneth L. Samuelson, Samuelson Law Offices, LLC. U. S. Trustee for Region Four, U.S. Trustee, represented by Joseph A. Guzinski, U. S. Trustee's Office. Douglas George Jefferies filed for Chapter 11 bankruptcy protection (Bankr. D.D.C. Case No. 18-00099) on Feb. 15, 2018. EDEN HOME: DOJ Watchdog Appoints S.N. Goodman as PCO ---------------------------------------------------- The U.S. Trustee, pursuant to Federal Rule of Bankruptcy Procedure and the Order Directing the Appointment of Patient Care Ombudsman entered by the U.S. Bankruptcy Court for the Western District of Texas on March 26, 2018, appoints Susan N. Goodman as the Patient Care Ombudsman in the case of Eden Home, Inc. Susan N. Goodman can be reached at: Mesch, Clark & Rothschild, PC. 259 N. Meyer Avenue Tucson, AZ 85701-1090 The U.S. Trustee for Region 7 is represented by: Kevin M. Epstein, Esq. Trial Attorney 615 E. Houston St., Room 533 San Antonio, TX 78205 Phone: (210) 472-4640 Fax: (210) 472-4649 E-mail: Kevin.M.Epstein@usdoj.gov About Eden Home, Inc. Located in New Braunfels, Texas, Eden Home, Inc. dba EdenHill Communities is a not-for-profit, faith-based organization that provides independent living, affordable housing, assisted living, skilled nursing and rehabilitation, long-term care and memory care services. The EdenHill Communities Transportation Department provides ADA services in support of seniors and individuals with disabilities. Visit https://edenhill.org for more information. Eden Home, Inc. dba EdenHill Communities fka Eden Home for the Aged, Incorporated filed a Chapter 11 petition (Bankr. W.D. Tex. Case No. 18-50608), on March 16, 2018. The Petition was signed by Laurence P. Dahl, chief executive officer and executive director. The case is assigned to Judge Craig A. Gargotta. The Debtor is represented by Dykema Cox Smith. At the time of filing, the Debtor had estimated assets and liabilities $10 million to $50 million. EVERETT'S AUTOMOTIVE: Unsecureds to Get 79% Under Plan ------------------------------------------------------ Everett's Automotive, LLC, filed a plan of reorganization and accompanying disclosure statement proposing to general unsecured creditors pro rata payments based upon monthly payments of $777.00 for the 18 months following the effective date and $3,000 per month thereafter for an additional 42 months. The total amount to be paid to general unsecured creditors will be $139,986.00, which is approximately 79% of the allowed general unsecured claims. Member Andrea Brown will retain her interest in exchange for a new value contribution of $2,500 to be paid in monthly installments over 36 months commencing in the month following the effective date. Distributions under the Plan will be made from cash deposits existing at the time of confirmation and from proceeds realized from the continued operation of the Debtor's business. A full-text copy of the Disclosure Statement is available at: http://bankrupt.com/misc/ilnb17-07795-91.pdf About Everett's Automotive Everett's Automotive, LLC, dba Midas Auto Service Experts, filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 17-07795) on March 13, 2017. Andrea Brown, Member, signed the petition. The Debtor is represented by Joel A. Schechter at the Law Offices of Joel A. Schechter. At the time of filing, the Debtor listed less than $50,000 in estimated assets and $500,000 to $1 million in estimated liabilities. EXPERT CAR: U.S. Trustee Unable to Appoint Committee ---------------------------------------------------- No official committee of unsecured creditors has been appointed in the Chapter 11 cases of Expert Car Care 3, LLC and Expert Car Care 4, LLC as of April 16, according to a court docket. About Expert Car Care Expert Car Care 3, LLC and Expert Car Care 4, LLC are privately-held companies in Sanford, Florida, engaged in automotive repair and maintenance. The Debtors sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case Nos. 18-01439 and 18-01440) on March 16, 2018. James Sada, managing member, signed the petitions. At the time of the filing, the Debtors disclosed that each of them had estimated assets of less than $1 million and liabilities of $1 million to $10 million. Judge Cynthia C. Jackson presides over the cases. FARWEST PUMP: May 23 Disclosure Statement Hearing ------------------------------------------------- Judge Brenda Moody Whinery of the U.S. Bankruptcy Court for the District of Arizona will consider the approval of the Disclosure Statement explaining the plan of reorganization filed by Debtor Farwest Pump Company and the disclosure statement explaining the plan of liquidation filed by the Official Committee of Unsecured Creditors for the Debtor at a hearing on May 23, 2018, at 10:45 a.m. Any party desiring to object to the Court's approval of the Disclosure Statement must file a written objection by May 14, 2018. The goal of the Creditors' Committee's Plan is to wind up the Debtor's business. In brief, the Plan proposes the formation of a Liquidating Trust that will liquidate all assets, continue to collect lease payments where profitable, pursue litigation claims, and distribute as much to Creditors as possible. Alternatively, the Plan permits the equity owners, the Debtor's insiders Clark Vaught and Channa Crews-Vaught, the right to purchase the Liquidating Plan Trust's interest in all property, including Litigation Claims. If the Vaughts choose to purchase the Liquidating Plan Trust's interest, they must contribute to the Estate an amount equal to pay all secured, unsecured, and administrative claims in full. The Purchase Option expires on the 61st day following Effective Date and will be deemed void if not exercised. Class 8 under the Committee plan consists of the general unsecured claims of the Debtor that do not have recourse against collateral and deficiency claims for Classes 3 through 7. The unsecured claims of non-insiders of the Debtor total approximately $1.4 million. To the extent funds are available, Class 8 will receive a pro rata quarterly distribution from the Liquidating Plan Trust with the first distribution due at the end of the first full quarter following the Effective Date. For purposes of ensuring the Liquidating Plan Trustee has the funds necessary to carry out the purpose and intent of the Plan, any distributions will be made to ensure the Liquidating Plan Trust has a reserve of $25,000 at all times until the final distribution. If, on the last day of each quarter, the Liquidation Trust has less than $25,000 in unencumbered cash, the Liquidating Plan Trustee will not make a distribution to Class 8 Creditors for that quarter. The Reserve will not include funds held for unsecured creditors with such claims subject to claims litigation. The Plan will be funded through the liquidation of all Estate Property, the collection of A/R, the collection of lease payments, and through the pursuit of all Litigation Claims. On the Effective Date, or as soon as practicable thereafter, the Liquidating Plan Trustee will sell or surrender Estate Property that does not generate income for the Liquidating Plan Trust. The net proceeds from the sale(s) shall be held by the Liquidating Plan Trustee and distributed in accordance with this Plan. In the event the Liquidating Plan Trustee is required to hire professional(s) to liquidate any Estate Property, such employment and liquidation shall be commercially reasonable as determined by the Liquidating Plan Trustee. The Liquidating Plan Trustee will have the absolute and sole discretion to hire professionals to carry out the purpose and intent of the Plan without Court approval. Under the Debtor proposed Plan, holders of Class 8 - general unsecured claims will be paid a pro rata share of the annual distributions from the Unsecured Claim Fund each April 15th until the earlier of (1) the date all unsecured creditors are paid in full, or (2) April 15, 2022. The Plan requires the Debtor to make the following contributions to the Unsecured Claims Fund: (1) Not later than the last business day of March 2019, the Reorganized Debtor must deposit the greater of $75,000 or Net Distributable Profits in Calendar Year 2018. (2) Not later than the last business day of March 2020, the Reorganized Debtor must deposit the greater of $50,000 or Net Distributable Profits in Calendar Year 2019. (3) Not later than the last business day of March 2021, the Reorganized Debtor must deposit the greater of $50,000 or Net Distributable Profits in Calendar Year 2020. (4) Not later than the last business day of March 2022, the Reorganized Debtor must deposit the greater of $50,000 or Net Distributable Profits in Calendar Year 2021. (5) Not later than the last business day of March 2023, the Reorganized Debtor must deposit the greater of $50,000 or Net Distributable Profits in Calendar Year 2022. Payments and distributions under the Debtor's Plan will be funded by the following: the Equity Contribution of the Class 10 Equity Security Holders; (b) the proceeds of preconfirmation asset sales under Section 363(f) of the Bankruptcy Code; (c) Net income from operations; (d) net proceeds from any asset sales; (e) net proceeds collected from litigation; and, (f) net proceeds collected from insurance. A full-text copy of the Committee Disclosure Statement is available at: http://bankrupt.com/misc/azb4-17-11112-174.pdf A full-text copy of the Amended Debtor Disclosure Statement is available at: http://bankrupt.com/misc/azb17-11112-117.pdf A full-text copy of the Debtor's Original Disclosure Statement is available at: http://bankrupt.com/misc/azb17-11112-164.pdf About Farwest Pump Company Based in Tucson, Arizona, Farwest Pump Company -- http://farwestwell.com/-- is a small organization that provides well drilling services to all of the southwest United States. Farwest also offers a wide variety of related services including sonar jet, municipal water systems, electrical control systems, complete machine shop, and environmental and geothermal services. Founded in 1982, Farwest is a licensed, bonded, and insured company with locations in Tucson, Willcox and Las Cruces. It is owned and operated by Clark and Channa Vaught. The Debtor sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 17-11112) on September 20, 2017. Channa Vaught, its president, signed the petition. At the time of the filing, the Debtor disclosed $2.51 million in assets and $1.85 million in liabilities. Judge Brenda Moody Whinery presides over the case. FIREWATER RIVER: Case Summary & 8 Unsecured Creditors ----------------------------------------------------- Debtor: Firewater River East, LLC 6483 N. Northwest Hwy. Chicago, IL 60631 Business Description: Firewater River East, LLC is a privately held company whose principal place of business is located at 403 East Illinois, Suite 010, Chicago, Illinois, 60611. Chapter 11 Petition Date: April 17, 2018 Court: United States Bankruptcy Court Northern District of Illinois (Chicago) Case No.: 18-11177 Judge: Hon. LaShonda A. Hunt Debtor's Counsel: David K. Welch, Esq. BURKE, WARREN, MACKAY & SERRITELLA, P.C. 330 N. Wabash, 21st Floor Chicago, IL 60611 Tel: 312 840-7000 Email: dwelch@burkelaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Jamie Suckow, president. A full-text copy of the petition containing, among other items, a list of the Debtor's eight unsecured creditors is available for free at: http://bankrupt.com/misc/ilnb18-11177.pdf FIRSTENERGY SOLUTIONS: Seeks to Hire A&M, Appoint CRO ----------------------------------------------------- FirstEnergy Solutions Corp. seeks approval from the U.S. Bankruptcy Court for the Northern District of Ohio to hire Alvarez & Marsal North America, LLC and appoint Charles Moore as its chief restructuring officer. Mr. Moore, managing director of A&M, and his firm will conduct a financial review of the businesses of the company and its affiliates; assist in the implementation of cash management strategies; help develop restructuring plans; assist the Debtors' finance staff; assist in the implementation of employee benefit programs; and provide other services related to its reorganization efforts. A&M will receive a monthly fee of $150,000 for the services of the CRO. Meanwhile, the Debtors will pay the additional personnel to be provided by the firm on an hourly basis. For restructuring services, the firm's hourly rates range from $850 to $1,050 for managing directors, $650 to $800 for directors and $400 to $625 for associates and analysts. For dispute and investigation-related services, the hourly rates range from $750 to $950 for managing directors, $500 to $750 for directors, and $275 to $475 for analysts and associates. The hourly rates for claims management services are: Managing Director $750 – $875 Directors $575 – $725 Consultants $450 – $550 Analysts $375 – $425 In addition, A&M will be entitled to a completion fee of $3 million, payable upon the earlier of the consummation of a Chapter 11 plan of reorganization; or the sale, transfer or other disposition of all or a substantial portion of the Debtors' assets and equity. A&M received $1 million as a retainer in connection with the preparation and filing of the cases. In the 90 days prior to the petition date, the firm received payments totaling $4,912,146 for its services. Mr. Moore disclosed in a court filing that his firm does not hold any interests adverse to the Debtors' estates, creditors and equity security holders. A&M can be reached through: Charles Moore Alvarez & Marsal North America, LLC 1000 Town Center, Suite 750 Southfield, MI 48075 Phone: +1 248-936-0800 / +1 248-936-0814 Fax: +1 248-936-0801 Email: cmoore%40alvarezandmarsal.com About FirstEnergy Solutions Akron, Ohio-based FirstEnergy Solutions, Corp. (FES) is a subsidiary of FirstEnergy Corp (NYSE:FE). FES -- http://www.firstenergycorp.com/-- provides energy-related products and services to retail and wholesale customers; and owns and operates 5,381 MWs of fossil generating capacity through its FirstEnergy Generation subsidiaries. FES also owns 4,048 MWs of nuclear generating capacity through its FirstEnergy Nuclear Generation subsidiary. Nuclear generating plants are operated by FirstEnergy Nuclear Operating Company (FENOC), which is a separate subsidiary of FirstEnergy Corp. On March 31, 2018, FirstEnergy Solutions and 6 affiliates, including FENOC, each filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. N.D. Ohio Lead Case No. 18-50757). The cases are pending before the Honorable Judge Alan M. Koschik, and the Debtors have requested that their cases be jointly administered. Parent company, First Energy Corp. and its other subsidiaries, including its regulated subsidiaries, are not part of the filing and will not be subject to the Chapter 11 process. First Energy Corp. listed $42.2 billion in total assets against $4.07 billion in total current liabilities, $21.1 billion in long-term debt and other long-term obligations and $13.1 billion in non-current liabilities as of Dec. 31, 2017. Akin Gump Strauss Hauer & Feld LLP is serving as legal counsel to the Filing Entities, Lazard Freres & Co. is serving as investment banker and Alvarez & Marsal North America, LLC is serving as restructuring advisor and Charles Moore has been appointed as Chief Restructuring Officer for the Filing Entities. Prime Clerk serves as the Debtors' claims and noticing agent. FOLTS HOME: FRNC, et al., Suit Referred to Bankr. Court ------------------------------------------------------- Plaintiff FRNC, LLC, later joined by FCADH, LLC, commenced the interpleader action captioned FRNC, LLC, et al., Plaintiffs, v. HOMELIFE AT FOLTS, LLC, et al., Defendants, No. 6:15-cv-812 (GLS/TWD) (N.D.N.Y.) against numerous defendants, to determine the proper distribution of certain money. Defendants and Debtors Folts Home and Folts Adult Home, Inc., filed a motion for directed reference to the U.S. Bankruptcy Court for the Northern District of New York, Utica Division. Defendant United States of America opposed the motion. Senior District Judge Gary L. Sharpe granted the Debtors' motion. Folts and FAH are not-for-profit corporations; the former owns a nursing home facility, and the latter owns an adult home facility, both of which are located in Herkimer, New York. Sometime before October 2013, each corporation experienced financial difficulties and sought appointment of a receiver in conjunction with the New York State Department of Health. From October 2013 until February 2015, FRNC and FCADH were the receivers of Folts and FAH, respectively, pursuant to executed agreements. As receivers, FRNC and FCADH took over complete responsibility for operating the Facilities, including billing and collection of accounts receivable. In operating the Facilities, FRNC accrued over $700,000 in surplus funds on behalf of Folts, and FCADH accrued over $26,000 in surplus funds on behalf of FAH ("Funds"). The Funds, held in trust for Debtors by FRNC and FAH, were to be returned at the conclusion of the receiverships. However, at the end of the receiverships in February 2015, several parties asserted claims to the Funds, including the United States. To resolve the competing claims to the Funds, FRNC commenced the instant interpleader action in July 2015, and FCADH was later added as a plaintiff. By stipulation, the Funds were paid into the registry of the court. The question in this case is whether the interpleader action before the court is "related to" Debtors' bankruptcy; if it is, it is referred to the Bankruptcy Court. In the Second Circuit, "related to" jurisdiction exists if a "litigation['s]. . . outcome might have any 'conceivable effect' on the bankrupt estate." Here, "related to" jurisdiction exists because the instant interpleader action might have a conceivable effect on Debtors' estates. Under the receivership agreements, the Funds were held in trust for Debtors by FRNC and FCADH and were to be returned to Debtors at the conclusion of the receiverships. For the reasons argued by Debtors, the Funds are property of their estates. As the instant interpleader action was brought to resolve competing claims to the Funds, the outcome of this litigation clearly has a conceivable effect on Debtors' estates. And "the Bankruptcy Court [is] the appropriate forum for resolution of an interpleader action involving a debtor as a named defendant, wherein the res [i]s allegedly property of the estate." The United States' predictions as to what the Bankruptcy Court might do and conjecture as to that Court's motives are unavailing. Its argument that the distribution of the Funds will be the same whether the instant action is referred or not, is also unavailing. That is not the test for whether "related to" jurisdiction exists. Moreover, as Debtors point out, if they are required to await the conclusion of the instant action, the resulting delay could result in more attorneys' fees and quarterly fees incurred by their estates as well as deficiency claims, which the United States' convoluted hypotheticals fail to consider. Thus, the Debtor's motion is granted and the case is referred to the U.S. Bankruptcy Court for the Northern District of New York, Utica Division. A full-text copy of the Court's Memorandum Decision and Order dated March 22, 2018 is available at https://is.gd/rRr4bM from Leagle.com. FRNC, LLC, Plaintiff, represented by Amy Shapiro -- ashapiro@hhk.com -- Hinman, Howard Law Firm & Harvey D. Mervis -- hmervis@hhk.com -- Hinman, Howard Law Firm. FCADH, LLC, Plaintiff, represented by Amy Shapiro, Hinman, Howard Law Firm. HomeLife at Folts, LLC, Defendant, represented by Frederick Evans Schmidt, Koch & Schmidt, LLC. Folts Home & Folts, Inc., Defendants, represented by Sarah M. Harvey -- sharvey@bsk.com -- Bond Schoeneck & King, PLLC, Stephen A. Donato -- sdonato@bsk.com -- Bond Schoeneck & King, PLLC, Camille Wolnik Hill -- chill@bsk.com -- Bond Schoeneck & King, PLLC, Frederick Evans Schmidt , Koch & Schmidt, LLC, pro hac vice, Mitchell J. Katz -- mkatz@menterlaw.com -- Menter, Rudin Law Firm & Michael J. Balestra -- mbalestra@menterlaw.com -- Menter, Rudin Law Firm. United States of America Department of Treasury-Internal Revenue Service & United States of America Department of Housing and Urban Development, Defendants, represented by James Yu, U.S. Department of Justice - Tax Division & Michael D. Gadarian, Office of the United States Attorney. State of New York Department of Taxation and Finance, State of New York Department of Health, State of New York Department of Labor & Workers Compensation Board of The State of New York, Defendants, represented by John F. Moore, Office of Attorney General. Niagara Mohawk Power Corporation, doing business as, Defendant, represented by Robert B. Liddell -- rliddell@barclaydamon.com -- Barclay Damon LLP. Mountainside Medical Equipment, Inc., Defendant, represented by Daniel S. Cohen, Cohen, Cohen Law Firm. Wesco Insurance Company & Rochdale Insurance Company, Defendants, represented by Gary J. Valerino -- gvalerino@mcvlaw.com -- Meggesto, Crossett Law Firm. Chem Rx Pharmacy Services, LLC, Defendant, represented by John F. Queenan, Rivkin Radler LLP & Matthew C. Williams -- mwilliams@fmdlegal.com -- Fultz Maddox Dickens PLC. About Folts Home Folts Home is a New York not-for-profit corporation and the owner of a 163-bed long-term residential health care and rehabilitation facility located at 100-122 North Washington Street, Herkimer, New York. In addition to long-term skilled nursing and residential care, Folts Home provides memory care to residents with dementia, palliative care and respite care and operates an adult day care program. Folts Home also offers rehabilitation services, like physical, occupational and speech therapy, on both inpatient and out-patient bases. Currently, Folts Home has approximately 218 active employees. Approximately 124 of the employees are full-time, 60 are part-time and 34 employees are employed on a per diem basis None of Folts Home's employees are represented by labor unions. Folts Adult Home, Inc. ("FAH"), also known as Folts-Claxton, is a New York not-for-profit corporation and the owner of an 80-bed adult residential center that was constructed in 1998 and is located at 104 North Washington Street, Herkimer, New York. FAH residents reside in separate apartments and are provided services like daily meals, laundry, housekeeping and medication assistance. FAH has approximately 22 active employees. Approximately 12 are full-time employees and 10 are part-time employees. None of FAH's employees are represented by labor unions. Folts Home and FAH currently have average daily censuses of 145 and 69, respectively. Folts Home has 3 major payors: Medicare, Medicaid and Excellus/Blue Cross. The majority of FAH residents are government subsidized, with 58% covered by Social Security Insurance and 42% private pay. Folts Home and Folts Adult Home, Inc., filed separate, voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D.N.Y. Lead Case No. 17-60139) on Feb. 16, 2017. The Hon. Diane Davis presides over the cases. Stephen A. Donato, Esq., at Bond, Schoeneck & King, PLLC, serves as the Debtors' counsel. Folts Home and Folts Adult Home, Inc., through duly-appointed receivers HomeLife at Folts, LLC and HomeLife at Folts-Claxton, LLC, continue to operate their skilled nursing home and adult residence businesses, respectively, and manage their properties as debtors in possession. William K. Harrington, the U.S. Trustee for Region 2, appointed Krystal Wheatley as patient care ombudsman for the Debtors. GEM HOSPITALITY: U.S. Trustee Unable to Appoint Committee --------------------------------------------------------- No official committee of unsecured creditors has been appointed in the Chapter 11 cases of GEM Hospitality, LLC and its affiliates as of April 16, according to a court docket. About GEM Hospitality GEM Hospitality, LLC, and its affiliates are privately-held companies in Peoria, Illinois, engaged in activities related to real estate. GEM is owned by Gary Matthews and his partners. Mr. Matthews is the developer of the Marriott Pere Marquette and adjoining Courtyard by Marriott. The Debtors sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Ill. Lead Case No. 18-80361) on March 17, 2018. The petition was signed by Jeffrey T. Varsalone, the Debtors' chief restructuring officer. Mr. Varsalone is managing director of CBIZ MHM, LLC. The Debtors estimated assets and liabilities of $50 million to $100 million. Judge Thomas L. Perkins presides over the cases. Jonathan P. Friedland, Esq., at Sugar Felsenthal Grais & Helsinger LLP, serves as counsel to GEM. GREEN DREAMS: U.S. Trustee Unable to Appoint Committee ------------------------------------------------------ The Office of the U.S. Trustee on April 16 disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Green Dreams Landscape Management, Inc. About Green Dreams Landscape Management Green Dreams Landscape Management, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. N.C. Case No. 18-80230) on March 27, 2018. Judge Benjamin A. Kahn 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. Ivey, McClellan, Gatton & Siegmund, LLP is the Debtor's legal counsel. GREENE AVENUE: Taps Biolsi Law Group as Special Counsel ------------------------------------------------------- Greene Avenue Restoration Corp. seeks approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire Biolsi Law Group P.C. as special counsel. The firm will represent the Debtor in an action styled U.S. Bank National Association, as Trustee for Specialty Underwriting and Residential Finance Trust Mortgage Loan Asset-Backed Certificates Series 2007-BC2 vs. Susan Green, et al. The case is pending in the Supreme Court of the State of New York, Kings County. Biolsi will charge an hourly fee of $300 for its services. Steven Alexander Biolsi, Esq., a principal of Biolsi and the attorney who will be handling the case, disclosed in a court filing that he does not hold or represent any interests adverse to the Debtor and its estate. The firm can be reached through: Steven Alexander Biolsi, Esq. Biolsi Law Group P.C. 111 Broadway, Suite 606 New York, NY 10006-1901 Phone: (212) 706-1385 Email: sabiolsi@sabiolsi.com About Greene Avenue Restoration Corp. Greene Avenue Restoration Corp. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 17-45394) on Oct. 19, 2017. Judge Carla E. Craig presides over the case. At the time of the filing, the Debtor estimated assets and liabilities of less than $1 million. The Debtor hired Rosen, Kantrow & Dillon, PLLC as its legal counsel. GT ADVANCED: Former Officers' Bid to Dismiss Trustee Suit Junked ---------------------------------------------------------------- District Judge Joseph N. Laplante denied defendants Thomas Gutierrez and Daniel W. Squiller's motion to dismiss all claims, other than the breach of contract claim asserted against Gutierrez in Count 4, in the case captioned Eugene I. Davis, as Trustee Of the GTAT Litigation Trust, the Duly authorized successor to GT Advanced Technologies Inc., et al. v. Thomas Gutierrez and Daniel W. Squiller, Civil No. 17-cv-147-JL (D.N.H.). The case involves the actions (and lack thereof) of Gutierrez and Squiller, two former corporate officers of the New Hampshire-based GT Advanced Technologies, Inc., a now-bankrupt manufacturer of materials for consumer electronics. The plaintiff alleges that the two former officers misled GTAT's board of directors regarding the technological and economic feasibility of its venture with Apple, Inc., in which GTAT was to manufacture sapphire for potential use by Apple to make its smartphone touch-screens more impervious to ruinous damage. Broadly speaking, the plaintiff asserts that the defendants knew or should have known that the agreement with Apple was doomed to fail, misled and concealed their knowledge from GTAT's board of directors to get the board to approve the deal, and then reaped substantial profits before GTAT collapsed into bankruptcy less than one year after entering into the agreement. The plaintiff's complaint asserts four claims against both defendants: Breach of the Fiduciary Duty of Care (Count 1); Breach of the Fiduciary Duty of Loyalty (Count 2); Corporate Waste (Count 3); and Equitable Subordination (Count 5). It also asserts two claims against Gutierrez only: Breach of Contract (Count 4); and "Objection to Claims" (Count 6), as well as one claim against Squiller only: "Objection to Claims" (Count 7). The defendants have moved to dismiss all claims in the complaint other than the breach of contract claim asserted against Gutierrez in Count 4. They contend that all of the claims are subject to the heightened pleading standard of Federal Rule of Civil Procedure 9(b) because they all "sound in fraud" and assert that the plaintiff has pled none of his claims with the requisite particularity. They further argue that even if Rule 9(b) does not apply, the plaintiff's claims should still be dismissed because they fail under the more lenient pleading standard of Federal Rule of Civil Procedure 8(a). The court held oral argument on March 20, 2018. The plaintiff alleges that the defendants knew that GTAT would be unable to meet the demands of the Apple Agreement and deliberately withheld that information from and gave misleading information to GTAT's board, to convince it that GTAT could meet its contractual obligations. The defendants contend that this portion of the plaintiff's breach of fiduciary duty claims fails under Rule 9(b) because the complaint does not plead a material misrepresentation or omission, or scienter, with particularity. Although the defendants purport to challenge the level of particularity with which the plaintiff has alleged fraud, in reality, the defendants argue that the plaintiff fails to allege sufficient facts to show a breach of fiduciary duties in light of the content of the board meeting minutes and their presentations to the board. That is, the defendants challenge the claims on the merits. For example, the defendants do not contend that the complaint fails to plead the who, what, where, and when of the allegedly false or fraudulent representations or omissions. The complaint is replete with specific allegations of misrepresentations and omissions of material fact during the defendants' presentations to the board regarding the Apple venture. Nor do the defendants contend that the complaint lacks specific factual allegations that make it reasonable to believe that the defendants knew that they were misleading or withholding material information from the board. Instead, the defendants charge that the plaintiff "has not pled his claims with particularity, where, as here, those allegations, informed by the documents incorporated by reference, negate, rather than support, any inference of fraud." The defendants quote extensively from board meeting minutes and their presentations to the board, pointing to various facts that may support a defense to the plaintiff's breach of fiduciary duty claims. For purposes of Rule 9(b), however, the question is the sufficiency of the pleadings -- not the merits of the plaintiff's claims. The defendants raise no actual challenge the level of particularity of plaintiff's allegations of fraud. The Defendants also contend that that the complaint fails to plausibly allege that they had a conflict of interest or acted in bad faith because, in light of their ownership of a significant number of GTAT shares, their interests in the Apple Agreement were perfectly aligned with those of GTAT's other shareholders. In other words, the defendants contend that there is no plausible reason that they would have intentionally driven GTAT toward a transaction that was guaranteed to fail because they would have been harmed just like any other shareholder. The Court finds that the complaint more than sufficiently alleges that the defendants had a motive to, and did act against GTAT's economic interest. And, the complaint, viewed in the light most favorable to the plaintiff, alleges that the defendants acted in bad faith. Thus, the defendants' arguments on this point are misplaced. A full-text copy of the Court's Memorandum Opinion dated March 27 is available at https://is.gd/3kAFf6 from Leagle.com. Eugene I. Davis, as the Trustee of The GTAT Litigation Trust, the duly authorized successor to GT Advanced Technologies Inc., Plaintiff, represented by Eric D. Madden -- emadden@rctlegal.com -- Reid Collins & Tsai LLP, pro hac vice, Nathaniel J. Palmer -- npalmer@rctlegal.com -- Reid Collins & Tsai LLP pro hac vice, William T. Reid, IV -- wreid@rctlegal.com -- Reid Collins & Tsai LLP, pro hac vice, Demetrio F. Aspiras, III -- daspiras@dwmlaw.com -- Drummond Woodsum & Jeremy R. Fischer -- jfischer@dwmlaw.com -- Drummond Woodsum. Thomas Gutierrez & Daniel W. Squiller, Defendants, represented by Brian J.S. Cullen -- bcullen@cullencollimore.com -- CullenCollimore PLLC, Elizabeth G. Hays -- liza.hays@morganlewis.com -- Morgan Lewis & Bockius LLP, pro hac vice, Emily E. Renshaw -- emily.renshaw@morganlewis.com -- Morgan Lewis & Bockius LLP, pro hac vice, Jason D. Frank, Bingham McCutchen LLP & Jordan D. Hershman -- jordan.hershman@morganlewis.com -- Morgan Lewis & Bockius LLP. About GT Advanced Technologies Headquartered in Merrimack, New Hampshire, GT Advanced Technologies Inc. -- http://www.gtat.com/-- produces materials and equipment for the electronics industry. On Nov. 4, 2013, GTAT announced a multi-year supply deal with Apple Inc. to produce sapphire glass material for use in consumer electronics products. Under the deal, Apple would provide GTAT with a prepayment of approximately $578 million paid in four installments and, starting in 2015, GTAT would reimburse Apple for the prepayment over a five-year period. GT is a publicly held corporation whose stock was traded on NASDAQ under the ticker symbol "GTAT." GTAT was de-listed from the NASDAQ stock exchange in October 2014. As of June 28, 2014, the GTAT Group's unaudited and consolidated financial statements reflected assets totaling $1.5 billion and liabilities totaling $1.3 billion. As of Sept. 29, 2014, GTAT had $85 million in cash, $84 million of which is unencumbered. On Oct. 6, 2014, GT Advanced Technologies and eight affiliates filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. D.N.H. Lead Case No. 14-11916). GT says that it has sought bankruptcy protection due to a severe liquidity crisis brought about by its issues with Apple. The Debtors have tapped Nixon Peabody LLP and Paul Hastings LLP as attorneys and Kurtzman Carson Consultants LLC as claims and noticing agent. The U.S. Trustee has named seven members to the Official Committee of Unsecured Creditors. The Committee' professionals are Kelley Drye as its bankruptcy counsel; Devine, Millimet & Branch, Professional Association as local counsel; EisnerAmper LLP as financial advisors; and Houlihan Lokey Capital, Inc. as investment banker. GTAT has reached a settlement with Apple. The settlement gives Apple an approved claim for $439 million secured by more than 2,000 sapphire furnaces that GT Advanced owns and has four years to sell, with proceeds going to Apple. In addition, Apple gets royalty-free, non-exclusive licenses for GTAT's technology. The bankruptcy case is assigned to Judge Henry J. Boroff. The Debtors tapped Nixon Peabody LLP and Paul Hastings LLP as attorneys and Kurtzman Carson Consultants LLC as claims and noticing agent. The U.S. Trustee has named seven members to the Official Committee of Unsecured Creditors. The Committee' professionals are Kelley Drye as its bankruptcy counsel; Devine, Millimet & Branch, Professional Association as local counsel; EisnerAmper LLP as financial advisors; and Houlihan Lokey Capital, Inc. as investment banker. * * * In November 2014, GTAT reached a settlement with Apple. The settlement gives Apple an approved claim for $439 million secured by more than 2,000 sapphire furnaces that GT Advanced owns and has four years to sell, with proceeds going to Apple. In addition, Apple gets royalty-free, non-exclusive licenses for GTAT's technology. In December 2015, GTAT filed a proposed reorganization plan that allows the company to continue operating as a going concern and gives most of the equity to entities providing bankruptcy-exit financing. GTT COMMUNICATIONS: S&P Affirms B Corp. Credit Rating, Outlook Neg. ------------------------------------------------------------------- S&P Global Ratings affirmed its 'B' corporate credit rating on McLean, Va.-based GTT Communications Inc. The outlook is negative. S&P removed all ratings from CreditWatch, where it had placed them with negative implications on Feb. 26, 2018. S&P also assigned a 'B' issue-level rating and '3' recovery rating to the company's proposed senior secured credit facilities, which consist of a $200 million revolving credit facility due 2023 (undrawn), a $1.33 billion term loan B due 2025, and a EUR640 million term loan B due 2025 (GTT Communications B.V. will be the borrower of the euro-denominated term loan). The '3' recovery rating indicates S&P's expectation for meaningful (50%-70%; rounded estimate: 65%) recovery of principal and interest for senior secured lenders in the event of a payment default. GTT will use the $2.12 billion of net proceeds--along with the proceeds from $575 million of senior unsecured notes to be issued in within weeks, $425 million of equity (including $250 million of convertible preferred equity investment from current GTT investors [to which S&P ascribe 100% equity credit since it expects it to convert before year-end] and $175 million of common equity investment from current Interoute investors), and $11 million of cash--to fund the $2.37 billion purchase price, refinance about $693 million of GTT's outstanding term loan debt, pay around $74 million of related transactions fees and expenses. S&P said, "The outlook reflects our view that despite potential operational benefits from the business combination, the mostly debt-financed acquisition of Interoute Communications Ltd. has increased the possibility that GTT's credit measures will remain at a level consistent with a lower rating over the next 12 months. Based on the proposed funding mix, we expect that pro forma adjusted debt to EBITDA will be about 7.5x in 2018 (inclusive of one-time restructuring costs), which is meaningfully higher than our previous expectation of about 5x. Moreover, we expect leverage to remain materially higher than our previous expectations over the next few years. As a result, we are revising our assessment of GTT's financial risk to "highly leveraged" from "aggressive"." The negative outlook reflects pro forma adjusted leverage that is currently elevated for the rating and potential integration risks stemming from the company's acquisition of Interoute, which could constrain EBITDA growth or limit the company's ability to reduce debt such that leverage remains above 6.5x over the next 12 months. S&P said, "We could lower the rating if the company is unable to reduce leverage to below 6.5x over the next 12 months, which could be caused by deterioration in operating and financial performance because of increased competitive pressures, execution missteps from the integration of Interoute, or limited access to public equity markets. We could also lower the rating if GTT were to make additional debt-financed acquisitions that prolong improvement in the company's credit metrics, such that leverage were sustained above 6.5x without a correspondent improvement in the company's business risk profile. "We could revise the outlook to stable over the next 12 months if the company is able to successfully integrate Interoute while remaining on track to achieve the full estimated synergies and reducing leverage comfortably below 6.5x on a sustained basis. However, even under that scenario, a stable outlook is contingent on expected stability in the competitive environment and the company maintaining a financial policy that allows for leverage to be sustained comfortably below 6.5x." HANISH LLC: May Use Phoenix REO Cash Collateral Until June 30 ------------------------------------------------------------- The Hon. Bruce A. Harwood of the U.S. Bankruptcy Court for the District of New Hampshire has entered an order authorizing Hanish, LLC to use Phoenix REO, LLC's cash and non-cash collateral during the eighth interim basis as set forth on the Budget. The Budget provides cash disbursements of approximately $505,469 covering the months of April through June 2018. The Debtor has represented that the Budget includes all reasonable, necessary, and foreseeable expenses to be incurred in connection with this Chapter 11 case and the operation of the Debtor's business for the period set forth in the Budget. The Debtor may also pay all U.S. Trustee fees incurred during the period in the Budget in addition to the items contained in the Budget. As of the Petition Date, the Debtor is liable to Phoenix REO for the of amount $6,732,462.02, secured by a perfected first priority security interest in the Mortgaged Property and substantially all of the Debtor's personal property assets, as set forth in the Loan Documents. As adequate protection for any diminution in the value of Phoenix REO's cash and non-cash collateral: (a) Phoenix REO is granted a security interest to the extent of any diminution in the value of Phoenix REO's cash and non-cash Collateral in all of the Debtor's post-petition assets. The post-petition grant of the security interest will be supplemental of, and in addition to, the security interest which Phoenix REO possesses pursuant to the Loan Documents. (b) If and to the extent the collateral used by the Debtor less any reduction in the pre-petition portion of the Claim from payments due under the Budget exceeds the value of the post-petition collateral, then Phoenix REO will have a claim in the amount of such Post-petition Shortfall which will have priority over all other claims entitled to priority under Section 507(a)(1), with the sole exception of quarterly fees due to the U.S. Trustee. (c) The Debtor will maintain all necessary insurance, and obtain such additional insurance in an amount as is appropriate for the business in which the Debtor is engaged, naming Phoenix REO as loss payee, additional insured, and mortgagee with respect thereto. The Debtor will provide Phoenix REO with proof of all such coverage, as well as prompt notification of any change in such coverage which may hereafter occur. (d) Phoenix REO will have the right to inspect the Collateral and the Mortgaged Property, as well as the Debtor's books and records during normal business hours. (e) The Debtor will pay any and all taxes, municipal charges, or other amounts accruing upon or with respect to the Collateral from and after the Petition Date if such amounts, if unpaid, would have priority over Phoenix REO's security interest in the Collateral under applicable law. (f) The Debtor will maintain the Collateral in good condition and will not permit waste to occur with respect to the Collateral. (g) The Debtor will make payments to Phoenix REO in good and collected funds in an amount equal to $30,000 each for application to the Claim in accordance with the Loan Documents (which payments will be subject to reallocation by the Court). The Debtor's right to use its assets and to use Phoenix REO's cash and non-cash Collateral will terminate upon the earliest of: A. June 30, 2018 at 11:59 p.m.; B. The Debtor's failure to maintain all necessary insurance; or C. At Phoenix REO's option, upon the occurrence of any one or more of the following: (a) The breach by the Debtor of any of the terms, conditions, or covenants of the Order; (b) The termination or cancellation of the Sale for any reason; (c) The appointment of a Trustee for the Debtor pursuant to Section 1104 of the Bankruptcy Code; (d) The conversion of this Case to a case under Chapter 7 of the Bankruptcy Code; (e) The dismissal of this Case; (f) The appointment of an examiner with any of the powers of a Trustee for the Debtor; or (g) The allowance of a Motion for Relief from the Automatic Stay allowing a creditor of the Debtor to foreclose upon or take possession of any material asset owned or leased by the Debtor. The Debtor is required to file a new Motion for the Use of Cash Collateral During the 9th Interim Period (if applicable) on or before June 13, 2018. Objections to the Motion will be filed with the Court on or before June 20, with a hearing on the Motion and the further use of cash collateral to be held on June 26, 2018, at 2:00 p.m. A full-text copy of the Order is available at: http://bankrupt.com/misc/nhb16-10602-358.pdf About Hanish, LLC Hanish, LLC, owns and operates a 59-unit Fairfield Inn & Suites by Marriott in Hooksett, N.H. The Company sought Chapter 11 protection (Bankr. D.N.H. Case No. 16-10602) on April 26, 2016, and is represented by Steven M. Notinger, Esq., at Notinger Law, PLLC. Nayan Patel, managing member, signed the petition. Judge Bruce A. Harwood presides over the case. The Debtor estimated its assets and debt at $1 million to $10 million at the time of the filing. HARDES HOLDING: Taps Bantz Gosch as Special Counsel --------------------------------------------------- Hardes Holding, LLC, seeks approval from the U.S. Bankruptcy Court for the District of South Dakota to hire Bantz, Gosch & Cremer, LLC as special counsel. The firm will provide legal services to the Debtor in connection with the claim filed by Sandton Credit Solutions Master Fund III. James Cremer, Esq., and Justin Scott, Esq., the attorneys who will be representing the Debtor, will charge $260 per hour and $225 per hour, respectively. Mr. Cremer disclosed in a court filing that he and his firm have no connection with any party with interests adverse to the Debtor and its creditors. Bantz Gosch can be reached through: James M. Cremer, Esq. Justin M. Scott, Esq. Bantz, Gosch & Cremer, LLC 305 Sixth Avenue SE Aberdeen, SD 57401 Phone: (605) 225-2232 Fax: (605) 225-2497 Email: Attorneys@bantzlaw.com About Hardes Holding Based in Miller, South Dakota, Hardes Holding, LLC, is in the business of grain farming & real estate rental. Hardes Holding filed a Chapter 11 petition (Bankr. D.S.D. Case No. 17-30039) on Dec. 4, 2017. Wade Hardes, authorized representative, signed the petition. As of Dec. 4, 2017, the Debtor had total assets of $21.42 million and liabilities amounting to $11.17 million. The Hon. Charles L. Nail, Jr., presides over the case. Clair R. Gerry, Esq., at Gerry& Kulm Ask, Prof. LLC, is the Debtor's bankruptcy counsel. No official committee of unsecured creditors has been appointed in the Debtor's case. HAROLD ROSBOTTOM: Order Denying Bid to Vacate Trustee Plan Upheld ----------------------------------------------------------------- In the case captioned HAROLD L. ROSBOTTOM, JR. v. GERALD H. SCHIFF, TRUSTEE, Civil Action No. 16-0880 (W.D. La.), Harold L. Rosbottom, Jr. appeals an order issued by the Bankruptcy Court dated June 8, 2016, denying a motion entitled "Rule 60(b) Motion to Vacate the Chapter 11 Confirmation Plan." District Judge Elizabeth Erny Foote affirms the Bankruptcy Court's order. Rosbottom filed for Chapter 11 bankruptcy in 2009 during a contentious divorce from his now ex-wife, Leslie Fox. Rosbottom originally functioned as the debtor-in-possession managing the Chapter 11 bankruptcy estate. However, during the course of the bankruptcy certain irregularities became apparent, prompting the Bankruptcy Court to appoint Gerald Schiff as Chapter 11 Trustee. The irregularities eventually led to a criminal indictment against Rosbottom for bankruptcy related crimes. On Sept. 28, 2012, Rosbottom was convicted on eight counts, including conspiracy to commit bankruptcy fraud, transfer of assets, concealment of assets, false oath, and conspiracy to launder monetary instruments. Rosbottom is currently serving a 120-month term in federal custody. A few months later, Schiff filed a Chapter 11 Plan of Reorganization wherein Rosbottom's interests in the bankruptcy estate were equitably subordinated to all other interests, including Fox, due to his criminal conviction for bankruptcy crimes against the estate. On April 22, 2013, the Bankruptcy Court held a confirmation hearing regarding the Plan, including the equitable subordination of Rosbottom's interests. On May 1, 2013, the Bankruptcy Court entered an order confirming the Plan of Reorganization. On May 3, 2013, Rosbottom timely filed a Notice of Appeal with the District Court. However, on August 14, 2013, his appeal was dismissed for failure to prosecute. On April 25, 2016, Rosbottom filed a pro se motion in Bankruptcy Court entitled "Rule 60(b) Motion to Vacate Order Equitably Subordinating the Interest of HLR in the Post Administration Estate." The motion sought to revoke the portion of the Bankruptcy Court's confirmation order concerning the equitable subordination of Rosbottom's interests in the estate. The Bankruptcy Court held a hearing on the motion on June 7, 2016. On June 8, 2016, the Bankruptcy Court denied Rosbottom's motion and issued a written opinion. The Bankruptcy Court concluded that Rosbottom's motion was a collateral attack of the confirmation order. Rosbottom timely appealed the Bankruptcy Court's order. Rosbottom argues that the confirmation order should be vacated because he did not receive proper notice or service of the proposed Chapter 11 Plan or Disclosure Statement. At the time the Trustee filed the proposed Plan and Disclosure Statement, Rosbottom was incarcerated at the Caddo Correctional Center awaiting assignment to a federal correctional facility. Rosbottom maintains that the majority of the filings were uploaded to the Bankruptcy Court's computerized ECF filing system, which he had no ability to access as a detainee. Therefore, Rosbottom asserts that he could not receive the electronically filed documents. Rosbottom contends that even if the proposed Plan and Disclosure Statement were mailed to him, the Trustee should have known that the institution would not permit him to receive the documents. Although Rosbottom concedes that according to a certificate of service filed by the Trustee some version of the proposed Plan was mailed first class to the facility, he maintains that the facility never delivered the documents to him. Rosbottom states that through diligence on his part he acquired enough information about the Trustee's proposals to file objections into the record. Rosbottom also states that his prior attorney had withdrawn from the case, and his criminal counsel advised the Bankruptcy Court that he was merely observing the proceedings. Finally, Rosbottom asserts that the inclusion of the equitable subordination clause within the proposed Plan creates an adversary proceeding with heightened service requirements. Upon review of the record, the Court agrees with the Bankruptcy Court that the evidence demonstrates that notice and service were properly provided to Rosbottom for the Disclosure Statement, proposed Plan, and for the setting of the hearing regarding the Plan. Proper notice and service only requires that the materials be placed in the mail, postage prepaid, to the recipient's place of abode. In this case, paper copies were mailed postage pre-paid to Rosbottom at the Caddo Correctional Center. Also, notice and service were made upon Warner per her instructions to the Trustee. As counsel of record, even for a limited purpose, Warner also received ECF notices of all bankruptcy filings. The Court is satisfied that notice and service were proper. Additionally, the Court finds that due process requirements were met. In addition to traditional notice and service, Rosbottom received actual notice. The evidence in the record demonstrates that Rosbottom had actual notice of the contents of the proposed Plan because he filed numerous objections regarding the proposed Plan and the equitable subordination clause. Actual notice more than satisfies the requirements of due process. Rosbottom also raised the issue of due process, which is a question of law. If Rosbottom was not afforded due process and the Court did not consider the issue, it may result in a miscarriage of justice. The facts demonstrate, however, that Rosbottom was provided ample due process during the confirmation hearing despite his physical absence from the courtroom. A full-text copy of the Court's Memorandum Ruling dated March 22, 2018 is available at https://is.gd/PbT3vS from Leagle.com. Harold L Rosbottom, Jr., Appellant, pro se. Gerald H Schiff, Appellee, represented by Peter A. Kopfinger -- peter.kopfinger@kellyhart.com -- Kelly Hart Pitre, Courtney Smart Lauer, Vinson & Elkins, Louis M. Phillips, Kelly Hart Pitre & Patrick Michael Shelby -- rick.shelby@kellyhart.com -- Kelly Hart Pitre. Louisiana Truck Stop & Gaming LLC, other Leslie B Fox, Appellee, represented by Louis M. Phillips, Kelly Hart Pitre. About Harold L. Rosbottom Harold L. Rosbottom, Jr., filed for Chapter 11 bankruptcy protection (Bankr. W.D. La. Case No. 09-11674) on June 9, 2009, estimating its assets at between $1 million and $10 million. The petition was signed by Mr. Rosbottom, Jr. Patrick S. Garrity, Esq., who has an office in Baton Rouge, Louisiana, serves as the Debtor's bankruptcy counsel. HDJ & J HOLDINGS: Seeks Authority to Use H & R Cash Collateral -------------------------------------------------------------- HDJ & J Holdings, LLC, requests the U.S. Bankruptcy Court for the Middle District of Florida for authority to use cash collateral. Prior to the Petition Date, the Debtor entered into a Notes and Agreements with Heritage Bank of North Florida. The Debtor believes that Heritage Bank have perfected its security interest and liens on its personal property, including inventory and the proceeds thereof. Ultimately, Heritage Bank was taken over by the FDIC and the Notes and Agreements were assigned to FirstCitizens Bank. Thereafter, FirstCitizens Bank transferred the Notes and Agreements to its current holder, H & R Merrill Road, LLC. The Debtor will prepare a budget and intends on offering replacements liens to H & R in order to protect the creditor's interest as well as monthly payments. The Debtor will also work with H & R in order to get an agreed order on the consensual use of cash collateral. In addition to replacement liens the Debtor is offering to make a regular monthly contract payment as it comes due. As of the Petition Date, the Debtor was current on this debt. A full-text copy of the Debtor's Motion is available at http://bankrupt.com/misc/flmb18-00997-6.pdf About HDJ & J Holdings HDJ & J Holdings, LLC, is the fee simple owner of a real property located at 7645 Merrill Road, Jacksonville, Florida, valued by the company at $2.91 million and a parcel of land located at 7663 Merrill Road, Jacksonville, Florida, valued by the company at $176,962. The company posted gross revenue of $424,990 in 2017 and gross revenue of $601,783 in 2016. HDJ & J Holdings sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 18-00997) on March 29, 2018. In the petition signed by Hayssam B. Yazji, member manager, the Debtor disclosed $3.09 million in assets and $4.58 million in liabilities. The Law Offices of Jason A. Burgess, LLC, serves as its legal counsel. HERMAN M. & AMANDA: U.S. Trustee Unable to Appoint Committee ------------------------------------------------------------ No official committee of unsecured creditors has been appointed in the Chapter 11 case of Herman M. & Amanda K Warner, LLC as of April 16, according to a court docket. About Herman M. & Amanda K Warner Herman M. & Amanda K Warner, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W.Va. Case No. 17-30439) on Sept. 28, 2017. Judge Frank W. Volk presides over the case. Turner & Johns, LLC, is the Debtor's counsel. JASON FLY LOGGING: Taps Taylor and Martin as Appraiser ------------------------------------------------------ Jason Fly Logging, LLC, seeks approval from the U.S. Bankruptcy Court for the Northern District of Mississippi to hire Taylor and Martin, Inc., as its appraiser. The firm will conduct an appraisal of the equipment and vehicles used by the Debtor in its operations. The fee for the appraisal is $9,500. John Seymour, an appraiser employed with Taylor and Martin who will be providing the services, disclosed in a court filing that his firm does not hold or represent any interests adverse to the Debtor's estate. Taylor and Martin can be reached through: John L. Seymour Taylor and Martin, Inc. 1865 North Airport Road P.O. BOX 349 Fremont, NE 68025 Phone: (800) 654-8280 Email: info@taylorandmartin.com About Jason Fly Logging Established in 2010, Jason Fly Logging, LLC, is a privately-held logging company in Batesville, Mississippi. Jason Fly Logging sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Miss. Case No. 18-10483) on Feb. 12, 2018. In the petition signed by Jason Fly, member, the Debtor estimated assets and liabilities of $1 million to $10 million. Judge Jason D. Woodard presides over the case. Toni Campbell Parker, Esq., in Memphis, Tennessee, serves as counsel to the Debtor. JOHNS TRUCKING: Court Confirms Chapter 11 Plan of Reorganization ---------------------------------------------------------------- Judge R. Kimball Mosier of the U.S. Bankruptcy Court for the District of Utah confirmed Johns Trucking Inc.'s plan of reorganization dated Jan. 30, 2018. The Court finds that the Plan properly classifies Claims and Interests. In addition to Administrative Expense Claims and Priority Tax Claims, which are not classified under the Plan, the Plan designates four Classes of Claims and one Class of Equity Interests. Article III of the Plan provides for the separate classification of Claims and Interests into five distinct Classes based on differences in their legal nature or priority. Valid business, factual, and legal reasons exist for separately classifying the various Classes of Claims and Equity Interests created under the Plan. Thus, the Plan satisfies Bankruptcy Code sections 1122 and 1123(a)(1). The Plan provides for the same treatment for each Claim and Equity Interest in each respective Class unless the holder of a particular Claim or Equity Interest has agreed to less favorable treatment with respect to such Claim or Interest, thereby satisfying Bankruptcy Code section 1123(a)(4). The Debtor also proposed the Plan in good faith and not by any means forbidden by law, thereby satisfying Bankruptcy Code section 1129(a)(3). The Debtor filed the proposed Plan with the legitimate and honest purposes of, among other things, reaching a fair, equitable, and expeditious resolution of the complex business and legal issues presented by this chapter 11 case. Further, the Court finds that the Plan is feasible and is not likely to be followed by a liquidation or further financial reorganization. The Debtor has presented credible and persuasive evidence that it will be able to make all payments required to be made under the Plan, and will otherwise be able to satisfy all of its obligations under the Plan. In accordance with Bankruptcy Code section 1123(b)(3)(A) and Fed. R. Bankr. P. 9019, the Plan incorporates the terms of any settlements reached with any creditors and the Debtor. In entering into any settlements, the Debtor considered the following: (i) the probability of success in the litigation against the settling parties; (ii) the difficulties to be encountered in collecting upon any affirmative claims under those actions; (iii) the complexity and likely duration of such litigation and the attendant expense, inconvenience and delay resulting from such litigation, and (iv) the paramount interest of its creditors including the inability to confirm and consummate a consensual plan of reorganization. The settlement of any disputes is well within the range of the Debtor's business judgment, and the Debtor has made a good-faith determination that the granting of the compromise, settlement, waiver and releases contained in the Plan is in the best interest of the Debtor, its creditors, and all parties in interest. The bankruptcy case is in re: JOHNS TRUCKING, INC., Chapter 11, 910 North 750 West Monroe, UT 84754 Debtor in Possession, Bankruptcy No. 17-20954 (Bankr. D. Utah.). A full-text copy of the Court's Findings dated March 22, 2018 is available at https://is.gd/QZtqT6 from Leagle.com. Johns Trucking Inc., Debtor, represented by Andres Diaz, Diaz & Larsen & Timothy J. Larsen, Diaz & Larsen. United States Trustee, U.S. Trustee, represented by Peter J. Kuhn -- Peter.J.Kuhn@usdoj.gov -- US Trustees Office. About Johns Trucking Johns Trucking Inc. was organized in 1991 and operates a trucking business in Utah. Johns Trucking sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Utah Case No. 17-20954) on Feb. 13, 2017. At the time of the filing, the Debtor estimated assets of less than $1 million. The case is assigned to Judge R. Kimball Mosier. Andres Diaz, Esq., and Timothy J. Larsen, Esq., at Diaz & Larsen, in Salt Lake City, Utah, serve as counsel to the Debtor. No trustee, examiner or creditors' committee has been appointed in the case. JOSEPH DETWEILER: Acquittal Orders on Misrepresentation Affirmed ---------------------------------------------------------------- In the appeals case captioned SEQUATCHIE MOUNTAIN CREDITORS, Plaintiffs/Appellants, v. JENNIFER LILE, Representative of the Estate of Deceased Joseph J. Detweiler, Defendant/Appellee, Case No. 5:17-cv-1042 (N.D. Ohio), plaintiffs/appellants Sequatchie Mountain Creditors appeal from the following two orders in favor of defendant/appellee Jennifer Lile entered by the U.S. Bankruptcy Court, Northern District of Ohio, in plaintiffs' adversary case: (1) the order and related memorandum opinion, In re Detweiler, No. 09-6118, 2017 WL 650062 (Bankr. N.D. Ohio Feb. 16, 2017), and (2) the order and related memorandum opinion, In re Detweiler, No. 09-6118, 2017 WL 1483489 (Bankr. N.D. Ohio Apr. 25, 2017). Upon review of the case, District Judge Sara Lioi affirms the bankruptcy court's orders. Plaintiffs' adversary claims are brought pursuant to 11 U.S.C. section 523(a)(2)(A), which provides that an individual debtor is not discharged from a debt "for money, property, services, or an extension, renewal, or refinancing of credit to the extent [the debt] is obtained by false pretenses, a false representation, or actual fraud, other than a statement respecting the debtor's . . . financial condition[.]" The Sixth Circuit has summarized the elements of section 523(a)(2)(A) [false representation] claim as follows: (1) the debtor obtained money through a material misrepresentation that, at the time, the debtor knew was false or made with gross recklessness as to its truth; (2) the debtor intended to deceive the creditor; (3) the creditor justifiably relied on the false representation; and (4) its reliance was the proximate cause of loss. Plaintiffs' legal and factual challenges to the bankruptcy court's rulings that neither Detweiler nor the Sequatchie Pointe sales force made false representations about construction completion timelines with an intent to deceive revolve around the first and second elements of plaintiffs' section 523(a)(2)(A) claims. For the first element of a section 523(a)(2)(A) claim, plaintiffs must show that: "1) debtor obtained money, 2) there was a material misrepresentation, [and] 3) the debtor knew the representation was false or was at the very least grossly reckless regarding its truth." The issue before the bankruptcy court regarding this element was whether Detweiler and the Sequatchie Pointe sales force either knew the timelines for completion of amenities and utilities were false, or were grossly reckless regarding the truth of the timelines. The bankruptcy court concluded that, although the timelines turned out to be inaccurate, the sales force did not know their statements were false because they were simply passing along information provided by their supervisor. With respect to Detweiler, the bankruptcy court found that even though Detweiler directly made representations regarding project timelines to some plaintiffs, or confirmed representations made by the sales force, there was no evidence that Detweiler knew at the time that those representations were false. Thus, the bankruptcy court concluded that plaintiffs failed to establish that Detweiler either knowingly made a material misrepresentation, or acted with a conscious indifference to the truth, regarding project completion timelines provided to plaintiffs. Even though the bankruptcy court concluded that plaintiffs failed to establish the first element of their section 523(a)(2)(A) claim with respect to project timelines, the bankruptcy court went on to analyze the second element--fraudulent intent. After considering circumstantial evidence and the totality of the circumstances, the bankruptcy court found that Detweiler intended to complete Sequatchie Pointe up until Jan. 15, 2009, and realized then that the project could not be finished. From this factual determination, the bankruptcy court concluded that when Detweiler and the sales force represented timelines for project completion to plaintiffs purchasing lots between 2006 and 2008, they did not intend to deceive plaintiffs because, at the time the lots were sold, Detweiler intended to complete Sequatchie Pointe and did not know that, ultimately, he would be unable to do so. After conducting a de novo review, the Court concludes that there is room in the totality of circumstantial evidence for an inference that, between 2006 and 2008 when plaintiffs purchased undeveloped land at Sequatchie Pointe, Detweiler intended to complete the project and, therefore, did not possess fraudulent intent with respect to representations made to plaintiffs regarding project completion. Accordingly, the issue of non-dischargeability is resolved in favor of the debtor. On appeal, plaintiffs contend that the bankruptcy court erred in examining whether the Sequatchie Pointe sales force had an intent to deceive plaintiffs and should have, instead, focused on whether Detweiler had an intent to deceive. Plaintiffs' theory is that, even if the sales force did not intend to deceive plaintiffs, Detweiler is liable because he knew that Sequatchie Pointe was not viable from the inception of the project, and is therefore responsible for the representations of his sales force that ultimately proved to be inaccurate. The Court has held, however, that the bankruptcy court did not err in concluding the plaintiffs failed to establish the first two elements of their section 523 claims as to Detweiler. Because the Court has affirmed the bankruptcy court's ruling that Detweiler did not possess fraudulent intent at the time the sales force represented project completion timelines to plaintiffs, it is arguably unnecessary for the Court to consider plaintiffs' appellate arguments regarding the sales force. For all of these reasons, the orders and decisions of the bankruptcy court challenged on appeal are affirmed. A full-text copy of the Court's Memorandum Opinion dated March 23, 2018 is available at https://is.gd/pyXz1a from Leagle.com. Sequatchie Mountain Creditors, Appellant, represented by Peter G. Tsarnas -- ptsarnas@goldman-rosen.com -- Goldman & Rosen, Charles A. Flynn, Berke, Berke & Berke & Marvin B. Berke, Berke, Berke & Berke. Jennifer Lile, Representative of the Estate of Deceased Joseph J. Detweiler, Appellee, represented by Scott M. Zurakowski -- szurakowski@kwgd.com -- Krugliak, Wilkins, Griffiths & Dougherty. About Joseph Detweiler Based in Uniontown, Ohio, Joseph J. Detweiler filed for Chapter 11 protection (Bankr. N.D. Ohio Case No. 09-63377) on Aug. 17, 2009. Anthony J. DeGirolamo, Esq., represents the Detweiler. In his petition, the Debtor has $3,669,999 in total assets and $32,913,552 in total debts. KEAST ENTERPRISES: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Affiliates that filed voluntary petitions seeking relief under Chapter 11 of the Banruptcy Code: Debtor Case No. ------ -------- Keast Enterprises Inc. (Lead Case) 18-00856 dba Keast Sales 45565 Aspen Road Henderson, IA 51541 Cyclone Cattle, L.L.C. 18-00858 Hatswell Farms, Inc. 18-00859 Business Description: Keast Enterprises and Hatswell Farms are engaged in the business of corn and soybeans farming. Cyclone Cattle owns a cattle feed lot. Visit http://www.keastenterprises.comfor more information. Chapter 11 Petition Date: April 17, 2018 Court: United States Bankruptcy Court Southern District of Iowa (Des Moines) Judge: Hon Anita L. Shodeen Debtors' Counsel: Jeffrey D. Goetz, Esq. BRADSHAW, FOWLER, PROCTOR & FAIRGRAVE, P.C. 801 Grand Avenue, Suite 3700 Des Moines, IA 50309-8004 Tel: 515/246-5817 Fax: 515/246-5808 FAX Email: goetz.jeffrey@bradshawlaw.com - and - Krystal R. Mikkilineni, Esq. BRADSHAW, FOWLER, PROCTOR & FAIRGRAVE, P.C. 801 Grand Ave, Ste 3700 Des Moines, IA 50309 Tel: (515) 246-5870 Fax: (515) 246-5808 Email: mikkilineni.krystal@bradshawlaw.com Debtors' Financial Advisor: JT KORKOW DBA NORTHWEST FINANCIAL CONSULTING Keast Enterprises' Total Assets: $10.08 million Keast Enterprises' Total Liabilities: $15.11 million The petition was signed by Russell A. Keast, president. A full-text copy of Keast Enterprises' petition is available for free at: http://bankrupt.com/misc/iasb18-00856.pdf List of Keast Enterprises' 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ PHI Financial Services 2016 Seed $289,281 PO Box 660635 Dallas, TX 75266 Credit Manager Tel: (800) 248-4030 Hardi North America Inc. Judgment $151,342 First National Bank Credit Cards $73,009 REM Inc. Equipment $70,176 Rem Batco Inc. Equipment $68,389 International Ag Insurance $33,670 Insurance Solutions premiums RCIS Hail Insurance $29,621 Norwood Sales, Inc. Equipment and $29,322 Credit Refund Walinga USA, Inc. Equipment $25,850 Agriland FS, Inc. Fuel $17,095 Lamson, Dugan & Murray LLP Attorney Fees $12,022 AgriVision Equipment Group, LLC Repairs $10,516 Lee Agri-Media Advertising $10,174 Titan Machinery Repairs $8,894 AgriVision Groiup, LLC Repairs $8,594 Four F Farms, Inc. Trucking $8,532 Schuler Mfg. & Equip Co. Inc. Equipment $8,511 Total Farm Solutions Feed $8,477 Bricktown Media Advertising $6,028 LightBox Systems Tech Support $5,060 KESTREL ACQUISITION: S&P Assigns Prelim. BB Rating on Secured Debt ------------------------------------------------------------------ S&P Global Ratings assigned its 'BB' preliminary issue-level rating to Kestrel Acquisition LLC's $375 million senior secured term loan B and $40 million senior secured revolving credit facility. The outlook is stable. The '1' preliminary recovery rating reflects S&P's expectation of very high (90%-100%; rounded estimate: 95%) recovery in the event of default. In February 2018, Platinum Equity Capital Partners IV L.P. announced its agreement to purchase, through Kestrel, the 810-megawatt (MW) Hunterstown CCGT in Gettysburg, Pa.--within the Mid-Atlantic Area Council (MAAC) zone in the PJM regional transmission organization (RTO). The 'BB' preliminary rating on the plant reflects its heat rate, which S&P thinks will lead to an annual capacity factor of about 65%-70%, exposure to market prices in PJM, and initial leverage lower than that of its peers. S&P said, "The stable outlook is based on our expectation of sound operational performance that leads to capacity factors around 65%–70% annually and spark spreads that don't materially decline below current levels. The rating is based on our minimum forecast S&P Global Ratings-calculated DSCR of 2.01x, which occurs in 2020. However, we expect DSCRs to be less robust in 2019 (in the 1.5x-1.7x range) as a result of one-time capital spending needs over the next 18 months. "We could lower the rating if the project cannot maintain a minimum DSCR of 1.8x on a forward-looking basis. This could stem from the deterioration of energy margins, possibly caused by lower power demand or continued low commodity prices. We could also revise the outlook or lower the rating if the project experiences unexpected operational issues that require an extensive forced outage. "While unlikely over the next 12-18 months, we could raise the rating if we expect the project to maintain a minimum base-case DSCR greater than 2.2x in all years, including during the post-refinancing period. This could stem from secular improvement in power and capacity prices in PJM and the continuation of procuring inexpensive natural gas feedstock." KEY SAFETY: Moody's Withdraws All Ratings ----------------------------------------- Moody's Investors Service withdrew all ratings on Key Safety Systems, Inc., including its B3 Corporate Family Rating. The following ratings and rating outlook were withdrawn: Key Safety Systems, Inc. Corporate Family Rating, at B3; Probability of Default Rating, at B3-PD; $75 million senior secured revolving credit facility due 2019, at B1 (LGD3); $575 million senior secured first lien term loan due 2021, at B1 (LGD3); Outlook, at stable. RATINGS RATIONALE On April 10, 2018, Key Safety completed an approximately $1.6 billion acquisition of the assets of Takata Corporation ("Takata"), except for certain assets and businesses related to Takata's manufacture and sale of phase-stabilized ammonium nitrate airbag inflators. The combined company was renamed Joyson Safety Systems. Concurrent with the transaction all previously rated debt at Key Safety was repaid. Headquartered in Auburn Hills, Michigan, Joyson Safety Systems designs, engineers and manufactures airbags and inflators, seatbelts, and steering wheels for the global automotive industry. Revenues, pro-forma for the transaction, are approximately $7 billion. Joyson Safety Systems is a subsidiary of Ningbo Joyson Electronic Corp. KEYW CORP: S&P Assigns 'B+' Corp. Credit Rating, Outlook Stable --------------------------------------------------------------- S&P Global Ratings assigned its 'B+' corporate credit rating to The KeyW Corp. The outlook is stable. S&P said, "At the same time, we assigned our 'B+' issue-level rating and '3' recovery rating to the company's proposed $215 million first-lien term loan due 2024 and $50 million revolving credit facility due 2023. The '3' recovery rating indicates our expectation for meaningful (50%-70%; rounded estimate: 60%) recovery in a default scenario. "Additionally, we assigned our 'B-' issue-level rating and '6' recovery rating to the company's proposed $75 million second-lien term loan due 2025. The '6' recovery rating indicates our expectation for negligible (0%-10%; rounded estimate: 0%) recovery in a default scenario. "Our rating on KeyW reflects its unique technological capabilities, small size, limited contract diversity, flexible cost structure, somewhat high (but improving) debt leverage, and management's commitment to reduce the company's debt. We expect KeyW's revenue and earnings to increase in 2018 and 2019 given its solid position in its niche market and its proprietary technology. The company's low capital spending and very modest working capital requirements enable it to generate relatively strong free cash flow, which it can use to repay its debt. Although KeyW's debt-to-EBITDA will be somewhat elevated in 2018 at 5.5x-6.0x, we expect the company to reduce its leverage below 5.0x in 2019 and anticipate that it will continue to reduce its debt thereafter. "The stable outlook on KeyW reflects our expectation that the company's debt leverage, which increased materially due to the Sotera acquisition in 2017, will decline in 2018 on a full year of earnings from the acquired business (with pro forma debt-to-EBITDA of 5.5x-6.0x). We anticipate that the company will continue to reduce its leverage in 2019 as its earnings increase, leading its debt-to-EBITDA to fall below 5x. "We could lower our ratings on KeyW if its debt-to-EBITDA remains above 5x over the next 12 months and we do not expect it to improve. This could occur if the company's earnings are weaker than expected because it is unable to compete with its larger competitors for new contracts, or if it decides not to use its cash flows to reduce its debt. Although less likely, this could also occur if the company undertakes a large debt-financed acquisition. "Although unlikely in the next 12 months, we could raise our ratings on KeyW if its debt-to-EBITDA declines below 4x and we expect it to remain at that level for an extended period. The company would most likely accomplish this by winning new business (due to its increased scale) and repaying its debt in excess of our expectations." LAMPLIGHT CONDOMINIUM: Unsecureds to Get 38.6% Under Plan --------------------------------------------------------- Lamplight Condominium Association, Inc., filed a plan of reorganization and accompanying disclosure statement proposing a minimum dividend of 38.6% to general unsecured creditors from immediately available cash and quarterly payments. General unsecured creditors may receive a Contingent Dividend of up to an additional 7.2% from contingent sources of payment. Payments and distributions under the Plan will be funded by the following: (a) Guaranteed Payment for Minimum Dividend. Payment of the Minimum Dividend of 38.6%, in the amount of $188,505.83, shall be paid as follows: (i) Lump Sum Payment on Effective Date. The Association has the sum of $105,882.44 available for immediate distribution on the Effective Date of the Plan. (ii) Periodic Payments. The balance of the Minimum Dividend, in the amount of $82,623.39, shall be paid in quarterly installments of $5,163.96. (b) Payment of Contingent Dividend. In addition to the Minimum Dividend, Class 1 creditors may receive a contingent dividend of 7.2% (a total of $35,000.00). This dividend is contingent due to the uncertainty of the payment stream from Boardwalk. During settlement negotiations with Boardwalk it became clear that neither Boardwalk nor its principal, Craig Yelin, had sufficient resources to tender a lump-sum settlement payment to the Association. For this reason, the Association accepted the settlement of $35,000.00 to be paid in monthly installments over a period of four (4) years. The payment is secured by a personal guarantee signed by Mr. Yelin and secured by his primary residence. Even with that security, repayment of the $35,000.00 settlement proceeds is not guaranteed. The Association will utilize its best efforts to collect the settlement proceeds from Boardwalk and/or Mr. Yelin, but if the debt becomes uncollectable in the judgment of the Association, the Contingent Dividend will not be paid. A full-text copy of the Disclosure Statement is available at: http://bankrupt.com/misc/ctb17-20078-132.pdf About Lamplight Condominium Association Lamplight Condominium Association, Inc., a non-stock corporation based in Connecticut, manages the common elements of Lamplight Condominiums located in East Hartford, Connecticut. The Debtor sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Conn. Case No. 17-20078) on January 22, 2017, listing under $1 million in both assets and liabilities. The Debtor hired Grafstein & Arcaro, LLC as legal counsel, and Lloyd Langhammer, Esq., as special counsel. No examiner, trustee or committee has been appointed in the case. LAURIE A. TODD: Bankr. Court Disallows Exemption of Inherited IRA ----------------------------------------------------------------- In the bankruptcy case captioned In re: Laurie A. Todd, Chapter 11, Debtor, Case No. 15-11083 (Bankr. N.D.N.Y.), Endurance American Insurance Company filed an objection to the exemption claimed by Debtor Laurie A. Todd in an inherited individual retirement account (the "inherited IRA"). Upon deliberation, Bankruptcy Judge Robert E. Littlefield ruled that the Debtor's exemption of her inherited IRA is disallowed and the inherited IRA is property of the estate. Janet R. DiStefano, the Debtor's mother, had two individual retirement accounts ("IRAs"). The Debtor was a beneficiary of one of her mother's IRAs. After Ms. DiStefano passed away on or about Feb. 16, 2008, the Debtor used the funds received from her mother to establish an inherited IRA through Charles Schwab. The parties agree that the Debtor's account was funded solely from Ms. DiStefano's bequest; the Debtor has not made any personal contributions to the inherited IRA. According to the Debtor's January 2018 Monthly Operating Report, the inherited IRA's book value is $800,000. The dispute between Endurance and the Debtor stems from the operation of Green Island Construction Group, LLC. Endurance, acting as surety, issued performance and payment bonds on behalf of Green Island. To induce Endurance to issue the bonds, the Debtor, and other family members, including Burbridge, signed a written General Agreement of Indemnity to hold Endurance harmless. Pursuant to the bonds, Endurance remitted substantial sums to claimants and filed an Amended Proof of Claim indicating that it has incurred a loss of $1,769,317.00 as a result of those payments, as well as accrued interest, costs, and fees. Prior to the filing of the bankruptcy case, Endurance commenced an action against the Debtor and the other indemnitors in state court. Endurance argues that the inherited IRA: (1) is not exempt pursuant to section 5205(c)(1) as the property is not held in trust for the Debtor; (2) is not exempt pursuant to section 5205(c)(2) as the inherited IRA is not "qualified" as an IRA under 26 U.S.C. section 408;6 and (3) constitutes property of the estate pursuant to 11 U.S.C. section 541(a).7 In opposition, the Debtor argues that the inherited IRA is a section 5205(c)(1) exempt trust because the tax code refers to inherited IRAs as trusts. The Debtor further asserts that the inherited IRA is qualified as an IRA and thus exempt pursuant to section 5205(c)(2). Finally, the Debtor argues that the inherited IRA is excluded from the estate pursuant to section 541(c)(2) as a section 5205(c)(3) spendthrift trust. Endurance has demonstrated that the inherited IRA is not exempt under section 5205(c)(1) as the Debtor maintains exclusive control over the inherited IRA. Due to the nature of inherited IRAs, the Debtor may withdraw "funds at any time, for any reason, and without penalty." In fact, the Debtor continues to withdraw funds from the inherited IRA.9 On this issue, the Debtor has not submitted any evidence which prevents the Court from finding that the Debtor has unfettered access to the funds in the inherited IRA. Therefore, the Court must conclude the property is not held in trust and thus the inherited IRA is not exempt under section 5205(c)(1). Additionally, the Court rejects the Debtor's argument that the inherited IRA is exempt on the basis that it is may be considered a trust for purposes of section 408(a). The manner in which the tax code categorizes an IRA is irrelevant to the determination of whether the property is held in trust for a debtor under New York law. Indeed, the Debtor has not provided the Court with any authority for the proposition that classification as a trust by another statutory scheme establishes whether the section 5205(c)(1) trust exemption applies. For these reasons, the Debtor's argument is without merit. The Court also finds that the Debtor's inherited IRA is not qualified, within the meaning of section 5205(c)(2), as an IRA under section 408. Finally, the Debtor argues that the inherited IRA must be excluded from property of the estate pursuant to section 541(c)(2) on the ground that it is a section 5205(c)(3) spendthrift trust. However, for the Debtor to succeed, the inherited IRA must fall within section 5205(c)(2) to be considered a section 5205(c)(3) spendthrift trust. This argument fails since the Court has already concluded that the inherited IRA does not fall within section 5205(c)(2). Similarly, to the extent that it can be said that the Debtor argues that the inherited IRA is excluded from the estate as a trust under section 5205(c)(1), the Debtor also does not prevail as the Court has ruled that the inherited IRA is not a section 5205(c)(1) trust. For all of these reasons, the inherited IRA is not excluded from property of the estate pursuant to section 541(c)(2). A full-text copy of the Court's Memorandum Decision and Order dated March 23, 2018 is available at https://is.gd/iDRSpF from Leagle.com. Laurie A. Todd, Debtor, represented by Francis J. Brennan -- fbrennan@nolanandheller.com -- Nolan & Heller, LLP. U.S. Trustee, U.S. Trustee, represented by Lisa M. Penpraze -- lisa.penpraze@usdoj.gov. -- Office of The United States Trustee & Kevin Purcell, Office of United States Trustee. Laurie A. Todd filed for Chapter 11 bankruptcy protection (Bankr. D.P.R. Case No. 15-03784) on May 20, 2015. LEHMAN BROTHERS: General Ore Loses Bid to Allow Claims ------------------------------------------------------ General Ore International Corporation Limited, Neu Holdings U.S. Corporation, Neu Foundation of California, Janice K. Moss, and Amy P. Neu ("Claimants") appeal from the Bankruptcy Court's order granting the SIPA Trustee's 260th Omnibus Objection to General Creditor Claims. Claimants are accountholders of Lehman Brothers Inc., the brokerage arm of Lehman Brothers Holdings Inc. District Judge William H. Pauley affirmed the Bankruptcy Court's order. Following LBI's collapse in 2008, James W. Giddens was appointed as the trustee tasked with liquidating LBI and returning customer property in accord with the Securities Investor Protection Act ("SIPA"). Although the Trustee expeditiously transferred all customer accounts to a solvent broker, Claimants separately filed general unsecured claims against LBI's estate for damages arising from LBI's failure to transfer their accounts before commencing a liquidation proceeding. The thrust of these claims is that LBI breached its fiduciary duty when it failed to comply with Claimants' instructions to transfer their accounts to new brokerage firms in a timely manner. The Trustee objected to these claims and moved to disallow them. The U.S. Bankruptcy Court for the Southern District of New York granted the Trustee's motion. Claimants appeal, asking the Court to reverse the Bankruptcy Court's order, and remand the action with instructions to overrule the Trustee's objection. This appeal involves the convergence of SIPA, the Bankruptcy Code, the Uniform Commercial Code ("UCC"), and common law. It presents the question of whether customers of a failed brokerage firm may assert general unsecured claims against the firm's estate for damages arising from unperformed account transfer requests that were submitted prior to the commencement of a SIPA proceeding. At stake is more than $117 million in claims that Claimants seek to recoup based on LBI's alleged failure to transfer their brokerage accounts to solvent brokers in a timely manner. The principal issue on appeal is whether Claimants may assert claims against LBI's estate for market losses arising from the failure to execute the Account Transfer Requests before the Filing Date even though the Trustee subsequently transferred their accounts to another solvent broker. Claimants contend that their Account Transfer Requests--which were filed before LBI initiated the SIPA Proceeding--represent general, unsecured claims that may validly be asserted against LBI's estate. As an initial matter, it is doubtful that LBI breached its duty to execute the Account Transfer Requests. Claimants acknowledge that LBI confirmed its "receipt of the account transfers submitted by the New Brokers on Claimants' behalves," and "correspondingly provided formal notice through the ACATS Service that the entire contents of Claimants' brokerage accounts at LBI were slated for transfer and delivery" to the New Brokers. LBI received and acknowledged the Account Transfer Requests on September 18, 2008. As a broker-dealer, LBI owed its accountholders certain duties under the UCC. Relevant here was LBI's obligation to "change [Claimants'] position into any other form of holding for which [they were] eligible or to transfer [their] position to an account at another" broker-dealer. Under the applicable FINRA rules governing broker-dealer activity, LBI had--after "validat[ing] the transfer instruction" from the New Brokers--three days to transfer Claimants' accounts. Unfortunately for Claimants, on Sept. 19, 2008--just a day after LBI confirmed receipt of the Account Transfer Requests--SIPC commenced the SIPA Proceeding. By all indication, LBI was in the process of executing the Account Transfer Requests in a commercially reasonable manner when the SIPA Proceeding interdicted the process. Claimants' cause of action is predicated on the simple fact that their accounts were never transferred before the Filing Date. But because the commencement of the SIPA Proceeding intervened during the three-day period in which LBI was required to fulfill the Account Transfer Requests, there is nothing to suggest that LBI had breached its duty of care to Claimants under UCC section 8-508. Claimants also question the constitutionality of the Bankruptcy Court's order on the ground that its construction of the UCC intrudes on Congress's right to establish a uniform system of bankruptcy law. More specifically, by finding that the SIPA Proceeding extinguished LBI's pre-liquidation UCC obligations, Claimants argue that the Bankruptcy Court's order contravened the principle that state statutes like the UCC must remain bankruptcy neutral. According to Claimants, the effect of the Bankruptcy Court's interpretation is to deprive creditors of their right to pursue general unsecured claims against the debtor's estate under Bankruptcy Code Section 502(b). But the Bankruptcy Court's reading of SIPA and the UCC do no such thing. First, the Bankruptcy Code's provisions are only applicable to the extent they are consistent with SIPA's provisions. As a matter of statutory interpretation, the Bankruptcy Court held that allowing the claims at issue here would be inconsistent with SIPA's provisions. Second, SIPA was created as a comprehensive scheme to regulate the liquidation of insolvent broker-dealers and empowers the Trustee to step into the shoes of the failed broker-dealer to, among other things, return customer property. By arguing that the Bankruptcy Court's interpretation of the UCC removes certain rights in the event of a bankruptcy or insolvency, Claimants ignore entirely the unique position that SIPA occupies in the context of broker-dealer insolvencies. Thus, while the Bankruptcy Code provides for the allowance of general claims, it does so in a SIPA proceeding only to the extent that it does not undermine SIPA's remedial purposes and the Trustee's statutorily prescribed duties. The Bankruptcy Court's conclusion that SIPA's provisions displace the specific duty in UCC section 8-508 does not interfere with Congress's authority to establish a uniform system of bankruptcy law. A full-text copy of the Court's Opinion and Order dated March 22, 2018 is available at https://is.gd/2EeTCp from Leagle.com. General Ore International Corporation Limited, Neu Holdings U.S. Corporation, Neu Foundation of California & Janice K. Moss, Appellants, represented by Vincent J. Roldan -- vroldan@vanfeliu.com -- Vandenberg & Feliu & David Daniel Farrell -- dfarrell@thompsoncoburn.com -- Thompson Coburn LLP. James W. Giddens, as trustee for the SIPA Liquidation of Lehman Brothers, Inc., Appellee, represented by Christopher K. Kiplok -- chris.kiplok@hugheshubbard.com -- Hughes Hubbard & Reed LLP, James Benedict Kobak, Jr. -- james.kobak@hugheshubbard.com -- Hughes Hubbard & Reed LLP, Jason Charles Benton, Hughes Hubbard & Reed LLP -- jason.benton@hugheshubbard.com -- Jordan Elliot Pace, Hughes Hubbard & Reed LLP & Dustin Philip Smith -- dustin.smith@hugheshubbard.com -- Hughes Hubbard & Reed LLP. Securities Investor Protection Corporation, Statutory Intervenor pursuant to Securities Investor Protection Act, 15 U.S.C. Section 78eee(d), Intervenor, represented by Kenneth J. Caputo, Securities Investor Protection Corporation. About Lehman Brothers Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For more than 150 years, Lehman Brothers has been a leader in the global financial markets by serving the financial needs of corporations, governmental units, institutional clients and individuals worldwide. Lehman Brothers Holdings filed for Chapter 11 bankruptcy (Bankr. S.D.N.Y. Case No. 08-13555) on Sept. 15, 2008. Lehman's bankruptcy petition disclosed US$639 billion in assets and US$613 billion in debts, effectively making the firm's bankruptcy filing the largest in U.S. history. Several other affiliates followed thereafter. Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset LLC sought for bankruptcy protection in December 2009. The Debtors' bankruptcy cases were assigned to Judge James M. Peck. Judge Shelley Chapman took over the case after Judge Peck retired from the bench to join Morrison & Foerster. A team of Weil, Gotshal & Manges, LLP, lawyers led by the late Harvey R. Miller, Esq., serve as counsel to Lehman. Epiq Bankruptcy Solutions serves as claims and noticing agent. Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, served as counsel to the Official Committee of Unsecured Creditors. Houlihan Lokey Howard & Zukin Capital, Inc., served as the Committee's investment banker. On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S. District Court for the Southern District of New York, entered an order commencing liquidation of Lehman Brothers, Inc., pursuant to the provisions of the Securities Investor Protection Act (Case No. 08-CIV-8119 (GEL)). James W. Giddens was appointed as trustee for the SIPA liquidation of the business of LBI. He is represented by Hughes Hubbard & Reed LLP. The Bankruptcy Court approved Barclays Bank Plc's purchase of Lehman Brothers' North American investment banking and capital markets operations and supporting infrastructure for US$1.75 billion. Nomura Holdings Inc., the largest brokerage house in Japan, purchased LBHI's operations in Europe for US$2 plus the retention of most of employees. Nomura also bought Lehman's operations in the Asia Pacific for US$225 million. Lehman emerged from bankruptcy protection on March 6, 2012, more than three years after it filed the largest bankruptcy in U.S. history. The Chapter 11 plan for the Lehman companies other than the broker was confirmed in December 2011. * * * In October 2016, the team winding down LBHI paid $3.8 billion to creditors, the 11th distribution since Lehman's collapse in 2008. This brought the total payout to more than $113.6 billion. Bondholders were projected to receive about 21 cents on the dollar when Lehman's bankruptcy plan went into effect in early 2012. The 11th distribution raised the bondholders' recovery to more than 40 cents on the dollar and recoveries for general unsecured creditors of Lehman's commodities to 79 cents on the dollar. Lehman's aggregate 12th distribution to unsecured creditors pursuant to its confirmed Chapter 11 plan will total approximately $3.0 billion. LINCOLN PAPER: Court Approves Disclosure Statement -------------------------------------------------- Upon consideration of the disclosure statement filed by Lincoln Paper and Tissue, LLC, and the Official Committee of Unsecured Creditors in relation to the plan of liquidation filed by the Plan Proponents, Judge Peter G. Cary of the U.S. Bankruptcy Court for the District of Maine approved the the Disclosure Statement as containing adequate information as required by Section 1125 of the Bankruptcy Code. About Lincoln Paper Lincoln Paper and Tissue, LLC, is a manufacturer of white tissue located on approximately 350 acres of land along the Penobscot River in Lincoln, Maine. The Company claims to have produced 70,000 tons of tissue and 75,000 tons of specialized, high-bulk uncoated free-sheet paper. Lincoln Paper and Tissue filed a Chapter 11 bankruptcy petition (Bankr. D. Maine Case No. 15-10715) on Sept. 28, 2015. In the petition signed by Keith Van Scotter, the president and CEO, the Debtor estimated both assets and liabilities of $10 million to $50 million. Judge Peter G. Cary is assigned to the case. The Debtor has engaged Bernstein Shur Sawyer & Nelson as counsel; Spinglass Management Group as financial advisor; SSG Capital Advisors, LLC as investment banker; and Eisenstein Malanchuk LLP as insurance claims consultant. LINDA THE BRA LADY: Gets Final OK to Continue Using Cash Collateral ------------------------------------------------------------------- The Hon. Jerrold N. Poslusny, Jr., of the U.S. Bankruptcy Court for the District of New Jersey has signed a final order authorizing Linda the Bra Lady LLC to continue using cash collateral pursuant to its budget annexed to its Motion. The Debtor is authorized to use cash collateral to meet its ordinary cash needs (and for such other purposes as may be approved in writing by Bank) for the payment of Debtor's actual expenses necessary to: (a) maintain and preserve its assets; (b) to continue operation of its business, including but not limited to payroll, payroll taxes, employee expenses, insurance costs, any quarterly fees owed to the U.S. Trustee commencing with the first quarter of 2018 and any required monthly payments to SBA; and (c) to purchase replacement supplies, etc. as required to operate. The United States Small Business Administration has a valid perfected and secured lien and security interest in all assets of the Debtor, other than the SP Consigned Goods, securing Bank's indebtedness in the current principal amount of $816,811, as of the Petition Date. To the extent that SBA's cash collateral lien is validated pursuant to further proceedings and is used by Debtor, SBA is granted a replacement perfected security interest to the extent and with the same priority in all of Debtor's post-petition collateral and proceeds thereof that SBA held in Debtor's pre-petition property. To the extent the adequate protection provided proves insufficient to protect SBA's interest in and to the cash collateral, SBA will have a superpriority administrative expense claim, senior to any and all claims against the Debtor. As adequate protection payment, the Debtor is also required to continue to make its regular monthly payments to SBA in the amount of approximately $4,100 for the duration of the Order. A full-text copy of the Final Order is available at http://bankrupt.com/misc/njb18-12469-57.pdf About Linda The Bra Lady Linda the Bra Lady LLC sought Chapter 11 bankruptcy protection (Bankr. D.N.J. Case No. 18-12469) on Feb. 7, 2018, listing under $500,000 in assets and under $10 million in liabilities. The Hon. Jerrold N. Poslusny Jr. presides over the case. E. Richard Dressel, Esq., at Flaster Greenberg, represents the Debtor. Founder Linda Becker operates two stores, one on Manhattan's East Side and another in southern New Jersey. The Company has been in business for 30 years. LIVING BENEFITS ASSET: Contract with Kestrel Voidable Under IAA --------------------------------------------------------------- Appellant Living Benefits Asset Management, LLC in the case captioned LIVING BENEFITS ASSET MANAGEMENT, LLC, Appellant, v. KESTREL AIRCRAFT COMPANY, INC., Appellee, Civil Action No. 4:17-cv-00486-O (N.D. Tex.) appeals from the bankruptcy court's March 9, 2017 oral ruling and March 23, 2017 final judgment order, which held that while Kestrel Aircraft Company, Inc. breached its contract with LBAM, LBAM was not entitled to recover on the contract because it failed to register under the Investment Advisors Act of 1940 ("IAA") and therefore the contract is voidable under the IAA. After considering the motion, briefing, the record on appeal and relevant law, District Judge Reed C. O'Connor denies the appeal and affirms the bankruptcy court's order. The Court considers whether life settlements constitute securities under the IAA. If so, then LBAM was an investment advisor, and LBAM's failure to register under the IAA makes its agreement with Kestrel in the Engagement Letter voidable. Both parties agree that the meaning of "securities" in the IAA is governed by the Supreme Court's three-part test in Howey. In Howey, the Supreme Court held that to determine whether a contract, transaction, or scheme is an investment contract for purposes of the securities acts, "[t]he test is whether the scheme involves [1] an investment of money in [2] a common enterprise [3] with profits to come solely from the efforts of others." LBAM argues that the bankruptcy court incorrectly concluded that the three prongs of Howey are met here because Kestrel did not invest money, no common enterprise existed, and Kestrel did not depend on LBAM for its expertise. Kestrel responds that the bankruptcy court correctly applied Howey, and further, that the Eleventh Circuit and the Texas Supreme Court have already examined this issue and determined that life settlements are securities under Howey. The Court begins with the first prong and finds that life settlements involve an investment of money. The CIM explicitly contemplated investment from Kestrel and third-party investors into life settlement portfolios. These portfolios would act as collateral guarantees against the debt facility Kestrel planned to create in order to fund their proposed prototype. LBAM gave advice in the CIM about the advisability of investing in life settlements. LBAM prepared the CIM to help Kestrel raise money, and both parties specifically contemplated the existence of investors and investment money, both from Kestrel and from third party investors. The first prong of Howey is satisfied here. Regarding the second prong, in order to determine whether there is a common enterprise, the "critical inquiry is confined to whether the fortuity of the investments collectively is essentially dependent upon promoter expertise." The Fifth Circuit standard "requires interdependence between the investors and the promoter, [but] it does not define that interdependence narrowly in terms of shared profits or losses." Instead, the necessary interdependence may be demonstrated by the investors' collective reliance on the promoter's expertise even where the promoter receives only a flat fee or commission rather than a share in the profits of the venture. Here, the bankruptcy court correctly found that there is a common enterprise in this case. The fortuity of the investments here--that is, the life settlements--is essentially dependent upon LBAM's expertise. LBAM was responsible for identifying the life settlements, for conducting due diligence on them, and for assisting Kestrel if valuing them. According to the Engagement Letter, LBAM would assist in finding a custodian, as well as other parties to help Kestrel administer the contemplated policies. Finally, the bankruptcy court found that even though Kestrel had the duty to negotiate, the fact remained that Kestrel had no background in life settlements so Kestrel's negotiations would rely "heavily if not exclusively on LBAM." Underwood's testimony at trial showed that he came to LBAM for the sole purpose of depending on their expertise. Additionally, LBAM's Freitag remarked that because of his special expertise in life settlements it was worth a million dollars just to be in the same room as him. These facts amply demonstrate that the second prong is satisfied in this case. Because the bankruptcy court correctly found that the life settlements contemplated in the CIM qualify as securities under Howey, LBAM qualifies as an investment advisor who gave advice regarding the advisability of investing in securities and therefore should have registered under the IAA. LBAM appears to argue that life settlements are not securities because LBAM never purchased them--as if the being of a thing is established by the commercial exchange of it. But the IAA's definition of "securities" is not so malleable, and that singular definition of "securities" applies to financial instruments regardless whether they are the subject of a transaction or financial advice. The instrument LBAM prepared and offered to Kestrel contained a financial transaction that qualified as a security under Howey, therefore, the Court dismisses the first two issues that LBAM brings on appeal. LBAM's last objection to the bankruptcy court's final judgment is that it impermissibly used parol evidence to vary the terms of the Engagement Letter and/or the Origination Agreement. The bankruptcy court acknowledged that it considered parol evidence in coming to its findings but concluded that LBAM was not prejudiced by the consideration of such evidence. Although LBAM claims that it was generally prejudiced due to the court's use of parol evidence, it points to no specific use of such evidence that tainted the bankruptcy courts findings of facts or conclusions of law. In order to state a valid appeal, the appellant must demonstrate that particular findings are clearly erroneous. The appellant may not ask the Court to review the entire record in a wholesale search for error, as LBAM does in its appeal. A full-text copy of the Court's Memorandum Opinion and Order dated March 26, 2018 is available at https://is.gd/OZfc81 from Leagle.com. Living Benefits Asset Management, LLC, Debtor & Living Benefits Asset Management, LLC, Appellants, represented by H. Joseph Acosta -- joseph.acosta@fisherbroyles.com -- FisherBroyles, LLP. Kestrel Aircraft Company, Inc., Appellee, represented by Mark H. Ralston -- mralston@fjrpllc.com -- Fishman Jackson Ronquillo PLLC, Sarah M. Olson -- solson@fredlaw.com -- Fredrikson & Byron PA & Todd Wind -- twind@fredlaw.com -- Fredrikson & Byron PA. Russell F. Nelms, Bankruptcy Judge, pro se. Case Admin Sup, Notice Only, pro se. Based in Fort Worth, TX, Living Benefits Asset Management, LLC filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 15-44621) on Nov. 16, 2015, listing its total assets at $885,000 and total liabilities $2,671,597. The petition was signed by Marcia Shieldknight, manager. MATADOR PROCESSORS: Founder Loses Age Discrimination Lawsuit ------------------------------------------------------------ District Judge Timothy D. DeGiusti granted the Defendant's motion for summary judgment in the case captioned BETTY WOOD, Plaintiff, v. MIDWEST PERFORMANCE PACK, INC., f/k/a MATADOR PROCESSORS, INC., Defendant, Case No. CIV-16-785-D (W.D. Okla.). Plaintiff Betty Wood and her husband founded Matador, Inc., in 1973. Matador was a food processing facility that focused on making chile rellenos and other breaded food products that could be frozen and sold to wholesale food distributors. In 2015, after experiencing financial difficulty and bankruptcy, Matador was purchased by Defendant Midwest Performance Pack, Inc. After the purchase was completed, Defendant retained all Matador employees including Plaintiff, who it retained as a consultant. This lawsuit arises from the subsequent breakdown in the parties' relationship. Plaintiff alleges she was singled out for unequal treatment and harassment by her supervisor. Plaintiff contends she complained of such treatment, but was disparaged and eventually retaliated against by way of termination for her actions. She asserts claims for age discrimination, retaliation, violation of the Employee Retirement Income Security Act of 1974 ("ERISA"), breach of contract, breach of implied contract, and intentional infliction of emotional distress. The Defendant then filed a motion for summary judgment. The Age Discrimination in Employment Act (ADEA) makes it illegal for employers "to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to [her] compensation, terms, conditions, or privileges of employment, because of such individual's age." Defendant contends Plaintiff's ADEA claim fails as a matter of law because during her employment, and at the time of her termination, Defendant did not employ more than fifteen people at any given time. Plaintiff states a genuine dispute exists because she "believes" at least twenty people were employed during her work and her criticism of Defendant's affidavit in this regard as a self-serving sham affidavit. Plaintiff's argument is unpersuasive for two reasons. First, Plaintiff's "belief" that at least twenty people were employed by Defendant contradicts her deposition testimony. In none of the summary judgment evidence cited by Plaintiff is the contention that Defendant had at least twenty employees after its purchase of the company. Second, Plaintiff has the burden, at this stage, to go beyond the pleadings and establish, through admissible evidence, that there is a genuine issue of material fact that must be resolved by the trier of fact; unsupported conclusory allegations do not create an issue of fact. Accordingly, Plaintiff's "belief" that Defendant employed at least twenty people is insufficient to withstand summary judgment, as is her conclusory allegation that Defendant has presented a "sham affidavit." Defendant's motion on this issue is granted. The Court finds summary judgment is also warranted as to Plaintiff's allegations of retaliation. In order to establish a prima facie case of retaliation, Plaintiff needed to show: (1) protected opposition to discrimination or participation in a proceeding arising out of discrimination; (2) adverse action by the employer contemporaneously or subsequent to the employee's protected activity; and (3) a causal connection between such activity and the employer's action. Here, Plaintiff admits that she never made any complaints about discrimination during her employment. Moreover, Plaintiff's EEOC charge neither alleges she was retaliated against nor provided fair notice of a retaliation claim. Defendant's motion on this issue is granted. Plaintiff also does not set forth any of the circumstances of her firing. She only contends summary judgment would be improper on this claim "because Rick Jackson disregarded the agreement he made with [Plaintiff] and Clark." The record, even viewed most favorably to Plaintiff, can hardly be construed as evidencing conduct that is "beyond all possible bounds of decency" or "utterly intolerable in a civilized community." Conduct is not "outrageous" simply because it is tortious or injurious. Additionally, Defendant has demonstrated it had legitimate, non-discriminatory reasons for terminating Plaintiff's employment. As such, the Court cannot find that Defendant's conduct constitutes intentional infliction of emotional distress. Summary judgment on this issue is granted. A full-text copy of the Court's Order dated March 22, 2018 is available at https://is.gd/hYucvz from Leagle.com. Betty Wood, Plaintiff, represented by E. Ed Bonzie -- ed@edbonzielaw.com -- Chandler & Bonzie. Midwest Performance Pack Inc, formerly known as Matador Processors Inc, Defendant, represented by Melissa R. McDuffey -- melissa.mcduffey@crowedunlevy.com -- Crowe & Dunlevy & Adam W. Childers -- adam.childers@crowedunlevy.com -- Crowe & Dunlevy. About Matador Processing Headquartered in Blanchard, Oklahoma, Matador Processing, LLC, fdba Matador Processors, Inc., makes frozen chile rellenos that are sold to restaurants. It was founded in 1975 by Clif and Betty Wood in Blanchard. At its peak, the Debtor employed about 49 people in Blanchard. Ms. Wood said in a NewsOK.com report that the Debtor now has 20 employees and is still hiring. The Debtor filed for Chapter 11 bankruptcy protection (Bankr. W.D. Okla. Case No. 13-15303) on Dec. 2, 2013, estimating its liabilities at between $500,001 and $1 million against $1 million to $10 million in estimated assets. The Hon. Niles L. Jackson presides over the case. David B. Sisson, Esq., who has an office in Norman, Oklahoma, serves as the Debtor's bankruptcy counsel. The petition was signed by Betty J. Wood, managing member. According to the NewsOK.com report, Ms. Wood said that she was forced to file for Chapter 11 bankruptcy protection a few weeks before Christmas in 2013 to save the Debtor's manufacturing plant from foreclosure after BancFirst, one of the Debtor's largest creditors, refused to work with the Debtor on its mortgage. MESAW LLC: Permitted to Use Cash Collateral Until May 31 -------------------------------------------------------- Judge John K. Sherwood of the U.S. Bankruptcy Court for the District of New Jersey has entered a third interim order authorizing Mesaw, LLC, to use the cash collateral in the ordinary course of its business until May 31, 2018, consistent with the budget. The next interim hearing for the continued use of cash collateral is scheduled for May 22, 2018 at 10:00 a.m. prevailing Eastern Time. As adequate protection for Debtor's use of cash collateral, the Secured Creditors are granted: (a) A replacement perfected security interest under Section 361(2) of the Bankruptcy Code to the extent the Secured Creditors' cash collateral is used by the Debtor, to the extent and with the same priority in the Debtor's post-petition collateral, and proceeds thereof, that the Secured Creditors held in the Debtor's pre-petition collateral. (b) The Debtor is directed to maintain and preserve the affected assets to include making all necessary repairs and maintaining sufficient insurances. (c) As further adequate protection, the Debtor will make payments to Bank of New Jersey as follows: (i) payment in the amount of $1,900 on or before April 15, 2018; and (ii) payment in the amount of $1,900 on or before May 15, 2018. (d) Pursuant to Section 507(b) of the Bankruptcy Code, the Secured Creditor will have a superpriority administrative expense claim to the extent the adequate protection provided proves insufficient to protect the Secured Creditor's interest in and to the cash collateral, senior to any and all claims against the Debtor. (e) The Debtor will provide bi-weekly periodic accountings to the Secured Creditor, setting forth the cash receipts and disbursements made by the Debtor. In addition, the Debtor will provide the Secured Creditor all other reports required by the pre-petition loan documents and any other reports reasonable required by the Secured Creditor, as well as copies of the Debtor's monthly U.S. Trustee operating reports. (f) The Debtor will permit such creditor and any of its agents reasonable and free access to the Debtor's records and place of business, to verify the existence, condition and location of collateral in which said creditor holds a security interest and to audit Debtor's cash receipts and disbursements. A full-text copy of the Third Interim Order is available at http://bankrupt.com/misc/njb17-32925-41.pdf About Mesaw, LLC Mesaw, LLC -- http://www.clubbarks.com/-- does business as Club Barks in Little Falls, New Jersey. It sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Case No. 17-32925) on Nov. 13, 2017. Stephen Anatro, its managing member, signed the petition. At the time of the filing, the Debtor estimated assets of less than $100,000 and liabilities of less than $500,000. The Debtor tapped Scura, Wigfield, Heyer, Stevens & Cammarota, LLP as its legal counsel, and Kotulak & Company, P.C., as its accountant. METROPOLITAN DIAGNOSTIC: May Use Cash Collateral Through April 30 ----------------------------------------------------------------- Judge Timothy A. Barnes of the U.S. Bankruptcy Court for the Northern District of Illinois entered a fifth interim order authorizing Metropolitan Diagnostic Imaging, Inc., to use cash collateral to the extent of plus or minus 10% of each line item set forth on the Budget up to and including April 30, 2018. The Budget for the period ending April 30, 2018 provides total operating expenses of $113,410. The Bancorp Bank is granted and will have replacement liens in and to the collateral which will have the validity, perfection and enforceability as the pre-petition liens held by Bancorp Bank. In addition, the Debtor will make an unallocated adequate protection payment to Bancorp Bank in the amount of $10,000 on or before April 18, 2018. The Debtor's Motion for Use of Cash Collateral is continued for further hearing to April 25, 2018 at 10:30 a.m. A full-text copy of the Fifth Interim Order is available at http://bankrupt.com/misc/ilnb17-35285-85.pdf About Metropolitan Diagnostic Imaging Based in Chicago, Illinois, Advanced Medical Imaging Center, Inc. -- https://www.amic-chicago.com/ -- has been providing radiological services since 1985. Its services include diagnostic breast MRI, digital screening mammography, high field MRI/MRA, open MRI/MRA, digital general x-ray, ultrasound, multi-detector CT/CTA, DEXA and fluoroscopy/arthrography. Metropolitan Diagnostic Imaging, d/b/a Advanced Medical Imaging, Inc., filed a Chapter 11 petition (Bank. N.D. Ill. Case No. 17-35285) on Nov. 28, 2017. In the petition signed by Moqueet Syed, its president, the Debtor estimated $1 million to $10 million in both assets and liabilities. The case is assigned to Judge Timothy A. Barnes. The Debtor's legal counsel is Gregory K. Stern P.C. NEW HOPE: Court Approves Disclosure Statement --------------------------------------------- The Hon. Brenda K. Martin of the U.S. Bankruptcy Court for the District of Arizona has approved the disclosure statement explaining New Hope Behavioral Health Center, Inc.'s Chapter 11 plan. As reported by the Troubled Company Reporter on Oct. 12, 2016, the plan disclosed an allowed Class 6 claims with a total of $266,604.47. Under that plan, holders of these claims would be paid monthly over a period of 90 months in the total amount of approximately $202,986.80. New Hope estimates that Class 6 claimants would receive payment of around 65-76% of their claims. About New Hope New Hope Behavioral Health Center, Inc., filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 13-14261) on Aug. 19, 2013, estimating its assets at up to $50,000 and its liabilities at between $500,001 and $1 million. James M. McGuire, Esq., at Davis Miles McGuire Gardner, PLLC, serves as the Debtor's bankruptcy counsel. NN INC: S&P Gives B- Rating to $200MM 2nd Lien Term Loan Due 2023 ----------------------------------------------------------------- S&P Global Ratings assigned its 'B-' issue-level and '6' recovery ratings to NN Inc.'s new $200 million second-lien term loan due April 2023. The '6' recovery rating indicates S&P's expectation of negligible (0%-10%; rounded estimate: 5%) recovery of principal and interest in the event of payment default. The second-lien term loan is part of the committed financing to fund NN's previously announced acquisition of PMG Intermediate Holding Corp., the parent company of Paragon Medical Inc., for $375 million in cash. The new term loan facility has a second priority perfected lien on all tangible and intangible assets and property of NN and its domestic and foreign subsidiaries. The term loan has no amortization or financial covenants and the terms comprise mandatory prepayments, including 50% of excess cash flow with step-downs to 25% and 0% at when consolidated secured leverage falls below 3x and 2.5x, respectively. S&P said, "Our 'B+' corporate credit rating and secured debt rating are unchanged, as is the stable outlook. "We view this transaction as a credit negative because it could further delay deleveraging toward its previously stated target (less than 3.5x net debt leverage by 2018). Although, per our estimates, pro forma for the proposed acquisition, the company's debt-to-EBITDA metric (with our adjustments excluding synergies and no cash netting) will be at over 6x, we expect debt to EBITDA to fall below 5x over the next 12 months, with free operating cash flow (FOCF) to debt remaining well over 5%. We could revise the outlook to negative or lower the rating to 'B' over the next few quarters if the company does not reduce debt to EBITDA below 5x on a sustained basis." RECOVERY ANALYSIS Key analytical factors -- S&P's simulated default scenario contemplates a default occurring in 2022 based on its assumption of a significant decline in the company's revenue and profits following a protracted period of weak global economic conditions. Although NN's business is diversified by region and end market, S&P assumes that its demand would weaken simultaneously across segments. Given NN's frequent acquisitions, the difficulty of integrating a large acquisition could also weaken its margins and cash flow. -- S&P has valued the company on a going-concern basis using a 5.5x multiple, reflecting the company's strong margins and positions in its key end markets. -- S&P estimates that, for the company to default, its EBITDA would need to decline about 25%, representing a material deterioration from the current state of its business, pro-forma for the announced acquisition. Simulated default assumptions -- Simulated year of default: 2022 -- EBITDA at emergence: $129 million -- EBITDA multiple: 5.5x Simplified waterfall -- Net enterprise value: $641 million -- Valuation split (obligors/nonobligors): 78%/22% -- Priority claims: $4 million -- Value available to first-lien debt (collateral/noncollateral): $589 million/$48 million -- Secured first-lien debt claims: $931 million --Recovery expectations: 50%-70% (rounded estimate: 65%) -- Second-lien debt claims: $210 million --Recovery expectations: 0%-10% (rounded estimate: 5%) Note: All debt amounts include six months of prepetition interest. Collateral value equals the asset pledge from obligors after priority claims plus the equity pledge from nonobligors after nonobligor debt. Ratings List NN Inc. Corporate Credit Rating B+/Stable/-- New Rating NN Inc. $200 mil sr secured 2nd lien term ln due April 2023 B- Recovery Rating 6(5%) NORTEL NETWORKS: Class Action Against Former Execs Dismissed ------------------------------------------------------------ Almost ten years after former top executives of bankrupt telecom giant Nortel were hit with a proposed shareholder class action, the case recently concluded -- with the dismissal of all claims against the defendants. Global law firm Morrison & Foerster represented the defendants, former Nortel CEO Mike Zafirovski and CFO Pavi Binning, in the significant securities case in the Southern District of New York. Joel Haims, Esq. -- jhaims@mofo.com -- the co-chair of MoFo's Securities Litigation, Enforcement, and White-Collar Defense Group, was a member of the MoFo team on the case. The ruling by US District Judge Denise Cote dismissed all claims against the defendants, finding no material misstatements or omissions and no intent to defraud. The proposed class action had been filed in 2009 against Mr. Zafirovski and Binning shortly after Nortel's bankruptcy during the financial crisis; the complaint alleged claims relating to financial projections and goodwill impairment under federal securities law. (Nortel was not a defendant in the case.) With Nortel headquartered in Canada, the case involved cross-border issues related to the Canadian and U.S. bankruptcy proceedings of the company, formerly a well-known name in the technology industry. The case had been stayed due to Nortel's bankruptcy proceedings, but the Canadian bankruptcy court recently issued an order to lift the stay, permitting litigation to continue in the Southern District of New York, and its dismissal. The MoFo team on the matter included Joel C. Haims, Jamie A. Levitt, Esq. -- jlevitt@mofo.com -- James J. Beha II, Esq. -- jbeha@mofo.com -- Steven T. Rappoport, Esq. -- srappoport@mofo.com -- Christina L. Golden, Esq. -- cgolden@mofo.com -- and Lauren M. Gambier, Esq. -- lgambier@mofo.com A full-text copy of Judge Cote's Decision is available at https://tinyurl.com/ydawpgcn from Leagle.com. About Nortel Networks Headquartered in Ontario, Canada, Nortel Networks Corporation and its various affiliated entities provided next-generation technologies, for both service provider and enterprise networks, support multimedia and business-critical applications. Nortel Networks Limited was the principal direct operating subsidiary of Nortel Networks Corporation. On Jan. 14, 2009, Nortel Networks Inc.'s ultimate corporate parent Nortel Networks Corporation, NNI's direct corporate parent Nortel Networks Limited and certain of their Canadian affiliates commenced a proceeding with the Ontario Superior Court of Justice under the Companies' Creditors Arrangement Act (Canada) seeking relief from their creditors. Ernst & Young was appointed to serve as monitor and foreign representative of the Canadian Nortel Group. That same day, the Monitor sought recognition of the CCAA Proceedings in U.S. Bankruptcy Court (Bankr. D. Del. Case No. 09-10164) under Chapter 15 of the U.S. Bankruptcy Code. That same day, NNI and certain of its affiliated U.S. entities filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 09-10138). In addition, the High Court of England and Wales placed 19 of NNI's European affiliates into administration under the control of individuals from Ernst & Young LLP. Other Nortel affiliates have commenced and in the future may commence additional creditor protection, insolvency and dissolution proceedings around the world. On May 28, 2009, at the request of administrators, the Commercial Court of Versailles, France, ordered the commencement of secondary proceedings in respect of Nortel Networks S.A. On June 8, 2009, Nortel Networks UK Limited filed petitions in U.S. Bankruptcy Court for recognition of the English Proceedings as foreign main proceedings under Chapter 15. U.S. Bankruptcy Judge Kevin Gross presides over the Chapter 11 and 15 cases. Mary Caloway, Esq., and Peter James Duhig, Esq., at Buchanan Ingersoll & Rooney PC, in Wilmington, Delaware, serves as Chapter 15 petitioner's counsel. In the Chapter 11 case, James L. Bromley, Esq., and Howard S. Zelbo, Esq., at Cleary Gottlieb Steen & Hamilton, LLP, in New York, serve as the U.S. Debtors' general bankruptcy counsel; Derek C. Abbott, Esq., at Morris Nichols Arsht & Tunnell LLP, in Wilmington, serves as Delaware counsel. The Chapter 11 Debtors' other professionals are Lazard Freres & Co. LLC as financial advisors; and Epiq Bankruptcy Solutions LLC as claims and notice agent. The U.S. Trustee appointed an Official Committee of Unsecured Creditors in respect of the U.S. Debtors. An ad hoc group of bondholders also was organized. An Official Committee of Retired Employees and the Official Committee of Long-Term Disability Participants tapped Alvarez & Marsal Healthcare Industry Group as financial advisor. The Retiree Committee is represented by McCarter & English LLP as Delaware counsel, and Togut Segal & Segal serves as the Retiree Committee. The Committee retained Alvarez & Marsal Healthcare Industry Group as financial advisor, and Kurtzman Carson Consultants LLC as its communications agent. Several entities, particularly, Nortel Government Solutions Incorporated and Nortel Networks (CALA) Inc., have material operations and are not part of the bankruptcy proceedings. As of Sept. 30, 2008, Nortel Networks Corp. reported consolidated assets of $11.6 billion and consolidated liabilities of $11.8 billion. The Nortel Companies' U.S. businesses are primarily conducted through Nortel Networks Inc., which is the parent of majority of the U.S. Nortel Companies. As of Sept. 30, 2008, NNI had assets of about $9 billion and liabilities of $3.2 billion, which do not include NNI's guarantee of some or all of the Nortel Companies' about $4.2 billion of unsecured public debt. Since the commencement of the various insolvency proceedings, Nortel has sold its business units and other assets to various purchasers. Nortel has collected roughly $9 billion for distribution to creditors. Of the total, $4.5 billion came from the sale of Nortel's patent portfolio to Rockstar Bidco, a consortium consisting of Apple Inc., EMC Corporation, Telefonaktiebolaget LM Ericsson, Microsoft Corp., Research In Motion Limited, and Sony Corporation. The consortium defeated a $900 million stalking horse bid by Google Inc. at an auction. The deal closed in July 2011. Nortel has filed a proposed plan of liquidation in the U.S. Bankruptcy Court. The Plan generally provides for full payment on secured claims with other distributions going in accordance with the priorities in bankruptcy law. The trial on how to divide proceeds among creditors in the U.S., Canada, and Europe commenced on Sept. 22, 2014. The question of how to divide $7.3 billion raised in the international bankruptcy of Nortel Networks Corp. was answered on May 12, 2015, by two judges, one in the U.S. and one in Canada. According to The Wall Street Journal, Justice Frank Newbould of the Ontario Superior Court of Justice in Toronto and Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Delaware, agreed on the outcome: a modified pro rata split of the money. OHIO SCRAP: Dist. Ct. OK's FMSB Bid to Enforce Settlement Agreement ------------------------------------------------------------------- District Judge Jeffrey J. Helmick granted Farmers & Merchants State Bank's motion to enforce the settlement agreement entered into by the parties in the case captioned United States of America, Plaintiff, v. $1,264,000.00 in U.S. Currency, et al., Defendants, Case No. 3:13-cv-905 (N.D. Ohio.). On April 22, 2013, the government initiated this forfeiture action involving a $1,264,000 in cash seized from Ohio Scrap Corporation, located in Delta, Ohio. Todd Zappone and Carrie Zappone are the owners and operators of Ohio Scrap Corporation. The currency allegedly was the subject of "structuring" by the owners of Ohio Scrap Corporation in violation of 31 U.S.C. section 5324(a)(3). The claimants in this case include Ohio Scrap Corporation, their owners, and The Farmers & Merchants State Bank, which holds a perfected security interest in the business assets and inventory. In December 2013, the parties in this litigation entered into a partial settlement agreement whereby $500,000 of the currency was disbursed, with $400,000 applied to the amount owed to Farmers and $100,000 applied to the Zappones' 2013 income tax liability. In return, Farmers agreed to subordinate its security interest in the balance of the currency with the understanding the balance would be applied to the Zappones' tax obligations for 2009 through 2012. Farmers also agreed to enter into a forebearance agreement to allow the Zappones a window of opportunity to liquidate their business free from collection efforts as well as consenting to dismissal of Ohio Scrap's Chapter 11 bankruptcy proceeding. In late February 2016, the Plaintiff advised the Court the Zappones had retained new counsel and were not inclined to sign the written settlement agreement circulated to all parties regarding the September mediation. Unable to resolve the dispute, Farmers moved to enforce the settlement agreement. Following briefing, the Court held an evidentiary hearing on July 19, 2016. A review of the record from the mediation and testimony at the evidentiary hearing establish the parties entered into a valid and enforceable agreement in which (1) the United States agreed to pay the Zappones $140,000 for settlement of their claims for attorney's fees; (2) the balance of forfeited funds, approximately $670,000, would satisfy the Zappone's tax liablities for 2009 through 2012; and (3) Farmers would receive the balance of the forfeited funds, relinquish claims against the $140,000 paid to the Zappones for attorney's fees, and consent to dismissal of Ohio Scrap's pending Chapter 11 bankruptcy. While the Zappones and Ohio Scrap contend material terms included a global resolution and release of the trucks, the Court disagrees. The parties agreed to work diligently on a global settlement but that language was aspirational and contingent upon completion of the three items referenced in the previous paragraph. The Plaintiff also moves for an award of reasonable attorney fees as a result of having to bring this action and moving to enforce the settlement agreement. In Tocci v. Antioch University, the Court determined the plaintiff's behavior amounted to bad faith conduct and awarded attorney's fees on that basis. Other courts have awarded attorney's fees where they were part of the settlement agreement. Generally, under the American Rule, the parties bear the burden of paying their respective attorney fees unless a rule or statute authorizes those fees. In this instance, there is no allegation of bad faith, therefore, the Court denies the Plaintiff's request for attorney's fees. The Zappones and Ohio Scrap Corporation also moved for return of $1,866,000 and various non-cash items seized by the United States or, in the alternative, move for an order directing the government to join those funds to this action. The Claimants also move for return of the cash property. Claimants contend there was actually $3,150,000 in the safe taken by the Plaintiff. They seek return of the balance, $1,886,000, which they claim was not identified and in the control of the United States following the seizure. The Court finds the Claimants' motions to be without merit. First, having determined Farmers & Merchants State Bank is entitled to enforcement of the settlement agreement, all aspects of the forfeiture case are resolved, thereby rendering their requests moot. Second, under Brown v. United States, where there is an adequate remedy at law available to the claimant, they cannot avail themselves of the equitable remedy under Rule 41(g). That remedy was sought by the Claimants in their Bivens action. Third, the United States denies having possession of the property Claimants seek to have returned. Fourth, the Court is without in rem jurisdiction over the property as the United States has not executed a Warrant of Arrest In Rem pursuant to Supplemental Rule G(3)(c). For these reasons, the Court grants Farmers & Merchants State Bank's motion to enforce the settlement agreement but deny an award of attorney's fees. The Claimants' motion for summary judgment is denied as moot and the motions for return are denied. A full-text copy of the Court's March 26, 2018 Memorandum Opinion is available at https://is.gd/cL1yrU from Leagle.com. United States of America, Plaintiff, represented by James L. Morford -- james.morford@usdoj.gov -- Office of the U.S. Attorney & Guillermo J. Rojas , Office of the U.S. Attorney. Todd Zappone, Carrie Zappone & Ohio Scrap Corporation, Claimants, represented by William T. Whitaker, Jr., Law Office of William T. Whitaker & Andrea L. Whitaker, Law Office of William T. Whitaker. Farmers & Merchants State Bank, Claimant, represented by Kenneth C. Baker, INVALID ADDRESS - Eastman & Smith, Robert J. Gilmer, Jr. -- rjgilmer@eastmansmith.com -- Eastman & Smith & Mark W.T. Sandretto, Eastman & Smith. Dunn Counsel PLC, Claimant, represented by Stephen J. Dunn. Robert J. Fedor, Esq., LLC, Claimant, represented by Robert J. Fedor -- rjfedor@fedortax.com -- Law Office of Robert J. Fedor. Ohio Scrap Corporation filed for Chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 15-30858) on March 22, 2015, and is represented by Mark Mockensturm, Esq. of Mockensturm Limited. OHLONE TRIBE: Court Grants U.S. Trustee Bid to Dismiss Ch. 11 Case ------------------------------------------------------------------ Bankruptcy Judge Mark Houle granted the U.S. Trustee's motion to dismiss the bankruptcy case captioned In re: OHLONE TRIBE OF CARMEL FIRST SETTLERS OF CHINO VALLEY, CA, INC., Chapter 11, Debtor, Case No. 6:18-bk-10381-MH (Bankr. C.D. Cal.). The U.S. Trustee is entitled to quarterly fees. A copy of Judge Houle's Order dated March 21, 2018 is available at https://is.gd/nXVATG from Leagle.com. Ohlone Tribe of Carmel First Settlers of Chino Valley CA Inc, Debtor, represented by Odeha L. Warren, Law Office of Odeha Warren. United States Trustee, U.S. Trustee, represented by Everett L. Green -- everett.l.green@usdoj.gov -- Office of the US Trustee. About Ohlone Tribe of Carmel Ohlone Tribe of Carmel is a domestic nonprofit corporation based in Rancho Cucamonga, California. This organization is primarily engaged in activities related to real estate. Ohlone Tribe is the fee simple owner of a parcel of land in the city of Hesperia commonly known as 15400 hwy 173, Hesperia, California valued by the company at $13 million. Ohlone Tribe previously sought bankruptcy protection on Dec. 4, 2017 (Bankr. C.D. Cal. Case No. 17-19965). Ohlone Tribe of Carmel filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 18-10381) on Jan. 18, 2018. In the petition signed by CEO David Vargas, the Debtor disclosed $13.01 million in total assets and $3.40 million in total liabilities. The case is assigned to Judge Mark D. Houle. Odeha Warren, Esq., at Law Office of Odeha Warren, is the Debtor's counsel. ONE CALL: S&P Lowers Corp. Credit Rating to 'CCC+', Outlook Stable ------------------------------------------------------------------ S&P Global Ratings said it lowered its long-term issuer credit rating on U.S. workers' compensation medical cost-containment provider One Call Corp. to 'CCC+' from 'B-'. The outlook is stable. S&P said, "Concurrently, we lowered our debt ratings on the company's first-lien senior secured term loan, first-lien notes, and senior secured revolvers to 'CCC+' from 'B-'. The recovery rating on these facilities is unchanged at '3', indicating our expectation for meaningful (50%-70%; rounded estimate: 65%) recovery in the event of a payment default. In addition, we lowered our debt rating on the company's second-lien term loan and unsecured notes to 'CCC-' from 'CCC'. The recovery rating is unchanged at '6', indicating our expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of payment default. "We have also assigned our 'CCC+' debt rating and '3' recovery rating (50%-70%; rounded estimate: 65%) to the company's proposed amended and extended $998 billion term loan and $56.6 million revolving credit facility due 2022 (these are the amounts if the entire facilities extend, and may lower if a portion of lenders choose not to extend). "The downgrade reflects continued deterioration in One Call's credit-protection measures in 2017 relative to our expectations, and our view that 2018 credit measures will continue to worsen. The stable outlook reflects our view that the company's liquidity will be adequate over the next 12 months, factoring in the proposed transaction, and that the company's new business and cost initiatives will lead to performance improvements over time. "The stable outlook reflects our view that although One Call's financial leverage levels are unsustainable, the company will not face a payment crisis during the next 12 months and liquidity will remain adequate following this proposed transaction as the company executes its turn-around strategy. Despite some new business traction and an expectation of slight (low single-digit) top-line growth, we expect the company's leverage to continue to deteriorate modestly in 2018 on continued margin pressures and remain very weak, with financial leverage of about 12x and EBITDA interest coverage of around 1x. We expect modest improvement in 2019, with leverage, absent any further debt transactions, of 9x-11x and EBITDA coverage slightly above 1x as cost pressures stabilize, restructuring spend rolls off, and new business initiatives take greater hold. "We could lower the rating if we can anticipate a possible default scenario over the next 12 months including a near-term liquidity crisis, violation of financial covenants, or our belief that the company is likely to consider a distressed exchange offer or redemption in the next 12 months. This could occur if 2018 credit measures deteriorate even further than we expect, we do not believe the company will be poised for improvement in 2019, or liquidity weakens materially (with sources relative to uses of less than 1.2x). "We see limited upside in the next 12 months given our expectation for continued earnings compression through 2018. However, we can consider an upgrade if earnings and cash-flow generation improve such that we view the capital structure as sustainable and more commensurate with 'B-' rated peers (leverage below 10x and coverage above 1.5x). We would also need to view the company as being in adequate standing in the credit markets such that it will be able to refinance maturities when they come due (starting in late 2020, if not all of the existing term loan extends)." OWENS & MINOR: S&P Assigns Prelim 'BB' Ratings on New Term Loans ---------------------------------------------------------------- S&P Global Ratings assigned its preliminary 'BB' issue-level rating and preliminary '3' recovery rating to Owens & Minor Inc. subsidiary Owens & Minor Distribution Inc.'s proposed senior secured $196 million new term loan A-2 and $500 million new term loan B. The '3' recovery rating on the term loans indicates S&P's expectations for meaningful (50%-70%; rounded estimate: 50%) recovery in a default scenario. S&P said, "Our 'BBB-' corporate credit rating and 'BBB-' issue-level rating on the company's existing unsecured debt (which becomes secured as part of the proposed transaction) remain on CreditWatch, where they were placed with negative implications on Nov. 1, 2017. Upon the consummation of the transaction, we expect to lower the corporate credit rating two notches, to 'BB'. At that time we also expect to lower the issue-level ratings on the outstanding unsecured debt by two notches to 'BB', as the entire capital structure will be secured." The debt proceeds will fund the company's planned acquisition of Halyard Health's surgical and infection prevention (S&IP) business for about $710 million and cover associated fees and expenses. The proposed debt has a provision requiring that Owens & Minor repay all amounts in full if the acquisition is not completed. S&P expects the company to close on the acquisition in the first half of 2018. RATINGS LIST Owens & Minor Inc. Corporate Credit Rating BBB-/Watch Neg/-- New Rating Owens & Minor Distribution Inc. Owens & Minor Medical Inc. Barista Acquisition I LLC Barista Acquisition II LLC O&M Halyard Inc. Senior Secured $196 mil term loan A-2 due 2023 BB(prelim) Recovery Rating 3(50%)(prelim) $500 mil term loan B due 2025 BB(prelim) Recovery Rating 3(50%)(prelim) P3 FOODS: Wants Plan Filing Extended Through June 19 ---------------------------------------------------- P3 Foods, LLC, filed a motion asking the U.S. Bankruptcy Court for the Northern District of Illinois to extend the deadline for filing its plan and disclosure statement on or before June 19, 2018. What led the Debtor into a Chapter 11 proceeding is that it had some financial issues that were related to management problems, suspected theft of a substantial sum of money; economic conditions in certain geographic areas where its nine Burger King franchises are located and operate. Shortly before filing, the Debtor hired an accounting and financial advising firm, Aldridge Chasewater LLC, to investigate these matters and to institute more appropriate management procedures. Those procedures concerned the opening of separate bank accounts for each of the nine stores operated and more carefully scrutinize budgeting, etc. The result is that the finances have been better organized, better monitored and these practices are now reflected in improved in sales and cash and inventory control. The Debtor has determined that the best and prudent course of action in order to cure prepetition defaults, including franchise fees, franchise royalties, past due sales taxes and other sums, would be to sell the nine separate operations as a going concern. All of the properties have been maintained post-petition and are being improved and cleaned. Even during the Debtor in Possession, the Debtor has made upgrades to procedures and computer hardware and software only to continue to smooth an uninterrupted operation of the business. The Debtor believes it has sufficient ability to put the properties up for sale and concurrent with the motion to extend, a motion to establish sale procedures is being filed. The Debtor, however, is not quite ready to file a Plan and Disclosure Statement because the reorganization, which essentially will be a liquidation, is dependent on obtaining a sale which of course would then determine what funds are available for distribution to the creditors. A full-text copy of the Motion is available at: http://bankrupt.com/misc/ilnb16-32021-209.pdf About P3 Foods P3 Foods, LLC, operator of nine Burger King franchises in Minneapolis, Minnesota, filed a chapter 11 petition (Bankr. N.D. Ill. Case No. 16-32021) on Oct. 6, 2016. Judge Donald Cassling is the case judge. The Debtor tapped Richard L. Hirsh, Esq., at Richard L. Hirsh, P.C., as counsel. The Debtor also engaged Aldridge Chasewater LLC as accountant. An official committee of unsecured creditors has not been appointed in the case. PEARL AGGREGATE: Seeks Approval to Retain Insiders -------------------------------------------------- Pearl Aggregate Materials LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Louisiana to continue to employ Arthur Geary and two other insiders. Mr. Geary, Pearl Aggregate's sole owner, has been serving as general manager of the Debtor. He has also been involved in product development and market research. The Debtor will pay Mr. Geary $3,000 every two weeks or $78,000 per year for his post-petition services. Meanwhile, it proposes to pay $1,387 per month to his wife Maryannan Geary, and $1,042 per month to his daughter Amie Geary. The Debtor also requests the court that the orders approving the insiders' continued employment be given effect, nunc pro-tunc, to the petition date. About Pearl Agggregate Pearl Aggregate Materials is a sand & gravel supplier in the St. Tammany Parish, Louisiana. The Debtor filed a Chapter 11 petition (Bankr. E.D. La. Case No. 18-10441) on Feb. 28, 2018, estimating under $1 million in both assets and liabilities. Robin R. DeLeo is the Debtor's counsel. Wayne M. Aufrecht, Esq. at Wayne M. Aufrecht, LLC as the co-counsel. PIEDMONT SALES: Court Approves Interim Use of Cash Collateral ------------------------------------------------------------- The Hon. Laura T. Beyer of the U.S. Bankruptcy Court for the Western District of North Carolina authorized Piedmont Sales Service & Transport, LLC, the interim use of cash collateral until April 13, 2018. Piedmont must use cash collateral in order to continue operations during the Chapter 11 proceeding. The cash collateral will be used to pay operating expenses, management fees, independent contractors and other necessary expenses for Piedmont's operations. Piedmont will provide adequate protection for the Secured Creditors with cash collateral liens, as follows: (a) Interstate Capital, a factoring company which obtains its payments by collecting a percentage of the payments it factors from Piedmont's customers. Piedmont's contract with Interstate Capital allows Interstate Capital to retain 100% of the future proceeds collected until the debt is paid. Piedmont expects the 2 customers to pay in the near future. Therefore, Piedmont proposes that Interstate Capital continue to collect its fees as a factoring company from these 2 delinquent customers; and Interstate Capital will not receive direct payments from Piedmont for the duration of the Interim Order. (b) National Funding has lien on all of Piedmont's assets. National Funding holds a debt of $80,000. It has an equity cushion of $38,272. Piedmont allows Nation Funding to retain its lien on pre-petition assets. Further, Piedmont permits National Funding receive direct payments from Piedmont in the amount of $1,000 for the duration of the Interim Order, which will provide payments on interest accruing in the amount of $667 per month and provide $333 payments toward principal. National Funding has consented to Piedmont's use of cash collateral. A full-text copy of the Interim Order is available at http://bankrupt.com/misc/ncwb18-50160-19.pdf About Piedmont Sales Service & Transport Piedmont Sales Service & Transport, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.C. Case No. 18-50160) on March 8, 2018. In the petition signed by Brian Souther, managing member, the Debtor estimated assets and liabilities of less than $1 million. Judge Laura T. Beyer presides over the case. The Debtor hired McElwee Firm, PLLC, as bankruptcy counsel. The Debtor tapped Tom Torcomian, Harvey Holdings Inc.'s consultant and chief operating officer, to manage its business. PINNACLE SERVICES: Seeks Authorization to Use Cash Collateral ------------------------------------------------------------- Pinnacle Services, LLC seeks authorization from the U.S. Bankruptcy Court for the Middle District of Florida to use cash collateral for the purpose of meeting the general and administrative expenses as set forth in the Budget. The Debtor projects that the business can be operated on a profitable basis such that in the ordinary course of business more cash collateral will be generated than used. The Debtor contends that the use of cash collateral provides Debtor with a reasonable opportunity for reorganization under chapter 11 which will maximize the value of its assets. Thus, if the Debtor is not permitted to use cash collateral, the Debtor claims that it will be forced to halt operations which will result in the loss of the going concern value of the business, the inability of the Debtor to collect on its large receivables related to ongoing jobs, and will jeopardize the Debtor's efforts to reorganize. Without use of cash collateral, those large receivables will be lost along with amounts due for work in progress. The Debtor believes that the following creditors may assert secured claims on cash collateral: (a) SunTrust Bank is owed money based on a security agreement in the approximate amount of $150,000. SunTrust is secured by an all asset lien. SunTrust has been cooperative with the Debtor and Debtor intends to continue the relationship on its current terms or on other terms agreed to by SunTrust. SunTrust is further secured by assets owed by a third party non-debtor. (b) The Business Backer is owed money on a disguised financing transaction in the approximate amount of $201,000. Business Backer is secured by receivables and an all asset lien. Debtor intends to continue the relationship on its current terms or on such terms as are appropriate. As adequate protection, Debtor proposes to continue making its monthly payments to SunTrust and Business Backer on their respective loans. In addition, the Debtor proposes to grant to SunTrust and Business Backer replacement liens to the extent of any diminution in value, with such liens to have the same validity, extent, and priority as their respective prepetition liens. The Debtor further submits that SunTrust and Business Backer are all adequately protected by an equity cushion in the Debtor's and third-party assets. Likewise, the interests of SunTrust and Business Backer will be further adequately protected by: (i) standard reporting requirements; (ii) continued maintenance of the Debtor's assets; and (iii) increased value of the Debtor's assets as a result of reorganization. Pinnacle Services, LLC filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 18-01852) on April 2, 2018. The Debtor is represented by: Michael A. Nardella, Esq. Nardella & Nardella PLLC 250 East Colonial Drive, Suite 102 Orlando, FL 32801 Telephone: (407) 966-2680 Facsimile: (407) 966-2681 Email: mnardella@nardellalaw.com PROSPECTOR OFFSHORE: Stay of Settlement Order Unnecessary, Ct. Says ------------------------------------------------------------------- Pro se appellant Michael R. Hammersley of the appeals case captioned MICHAEL R. HAMMERSLEY, Appellant, v. PROSPECTOR OFFSHORE DRILLING S.a r.l., et al., Appellees, Civ. No. 18-367 (LPS)., 18-368 (LPS) (D. Del.) filed an emergency motion for stay pending appeal from the orders approving the Debtors' settlement and dismissal. District Judge Leonard P. Stark denies the stay motion. Appellant is a shareholder of Paragon Offhsore plc ("Paragon Parent"). In Paragon Parent's prior bankruptcy proceedings (the "Paragon Cases"), a plan was confirmed and modified to provide that Paragon Parent would transfer its shares in Prospector Parent (and thus Prospector Entities) to New Paragon upon the satisfaction of certain conditions, including that the obligations of the Contracting Debtors under the terms of the Sale-Leaseback Agreements were discharged in full and the encumbrances, including over Prospector shares, were released. Appellant argued that the Prospector Entities, while subsidiaries of Paragon Parent, were not subject to the Paragon Cases; that Appellant has an equity interest in the Prospector Entities; and that he is entitled to recovery from Paragon Parent, despite the fact that Paragon Parent's creditors did not receive full recovery, and there is a shortfall of over $1 billion that would need to be addressed before equity holders of Paragon Parent would be entitled to a distribution. The plan was confirmed and modified over Appellant's objections, and Appellant's appeal of the plan modification order is pending. Debtors argue that Appellant's argument lacks merit and has been rejected many times in the Bankruptcy Court proceedings. Debtors argue that staying either the Settlement Order or the Order Authorizing Dismissal would cause catastrophic harm (i) to the Debtors and their creditors, by derailing the Settlement Agreement and leaving them only litigation and a burdensome break-up fee, and (ii) the shareholders of New Paragon (i.e., the less than whole creditors of Paragon Parent), who are positioned to receive $232 million pursuant to a potential sale to Borr Drilling Limited ("Borr Transaction"), as the consummation of the Settlement Agreement and dismissal of the Prospector cases are both conditions to the Borr Transaction. Debtors add that any stay would have to be conditioned on the immediate posting of a bond sufficient to protect the Debtors and their stakeholders from irreparable injury, in the amount of approximately $335 million. Appellant bears the burden of proving that a stay of the Settlement Order and Order Authorizing Dismissal is warranted based on the following criteria: (1) whether appellant has made "a strong showing" that it is likely to succeed on the merits; (2) whether appellant will be irreparably injured absent a stay; (3) whether a stay will substantially injure other interested parties; and (4) where the public interest lies. The most critical factors are the first two: whether the appellant has demonstrated (1) a strong showing of the likelihood of success, and (2) that it will suffer irreparable harm -- the latter referring to harm that cannot be prevented or fully rectified by a successful appeal. As to the first factor, Appellant has not met its burden of making "a strong showing" that it is likely to succeed on the merits of its appeal of the Settlement Order. Appellant appears to challenge the Settlement Order on the basis that it substantively consolidated the Prospector Cases and the Paragon cases. Debtors argue this is factually incorrect, as the Settlement Order simply approves the Settlement Agreement resolving issues between Debtors and their largest creditor, SinoEnergy. The Court finds no evidence or argument to contradict the Bankruptcy Court's findings that the Settlement Agreement is reasonable, and in the absence thereof, Appellant has little chance of success on appeal. Appellant has also failed to establish a likelihood of success on appeal with respect to the appeal of the Order Authorizing Dismissal. Appellant's primary challenge -- that the Prospector Entities are not subject to the Paragon Cases -- is a challenge to the plan confirmed in the Paragon Cases -- not to a dismissal of the Prospector Cases. Paragon's Plan provided for the transfer of the Prospector Entities to New Paragon pursuant to the order approving certain post-confirmation plan modifications, and Appellant's appeal of the order denying his motion for revocation of the Modification Order remains pending. In absence of any evidence challenging the Bankruptcy Court's finding that dismissal of the Prospector Cases is in the best interests of Debtors and their creditors, the Court cannot conclude that the Appellant is likely to succeed on the merits of his appeal. Appellant has also failed to establish that he would suffer irreparable harm if he is not granted stay relief. As an equity holder in Paragon Parent, Appellant has no economic interest in the Prospector Entities. Even if he did, under the plan confirmed in the Paragon Cases, equity holders like Appellant were entitled to no recovery. Thus, even if Appellant were to succeed on his appeal, he would still not be entitled to recovery in the Paragon Cases or the Prospector Cases. Moreover, the harm here is purely economic. Appellant has failed to demonstrate irreparable harm absent a stay. A copy of the Court's Order dated March 22, 2018 is available at https://is.gd/a6Atpz from Leagle.com. Michael R. Hammersley, Appellant, pro se. Prospector Offshore Drilling S.a r.l., Appellee, represented by Joseph Charles Barsalona, II -- barsalona@rlf.com -- Richards, Layton & Finger, PA & Mark David Collins -- collins@rlf.com -- Richards, Layton & Finger, PA. About Prospector Offshore and Paragon Offshore Paragon Offshore Plc, and several affiliates filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 16-10385 to 16-10410) on Feb. 14, 2016. The Delaware Bankruptcy Court entered an order on June 7, 2017, confirming the 2016 Debtors' Fifth Joint Chapter 11 Plan of Reorganization. Prospector Offshore Drilling S.a r.l. and three affiliates filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Case Nos. 17-11572 to 17-11575) on July 20, 2017. The affiliates are Prospector Rig 1 Contracting Company S.a r.l.; Prospector Rig 5 Contracting Company S.a r.l.; and Paragon Offshore plc (in administration). The Hon. Christopher S. Sontchi presides over the cases. The Debtors are represented by Gary T. Holtzer, Esq., and Stephen A. Youngman, Esq., at Weil, Gotshal & Manges LLP, and Mark D. Collins, Esq., Amanda R. Steele, Esq., and Joseph C. Barsalona II, Esq., at Richards, Layton & Finger, P.A., as counsel. The Debtors hired as their financial advisors, Lazard Freres & Co. LLC; as their restructuring advisor, AlixPartners, LLP; and as their claims, noticing and solicitation agent, Kurtzman Carson Consultants LLC. In their petition, the Debtors estimated $1 billion to $10 billion in both assets and liabilities. The petitions were signed by Lee M. Ahlstrom as senior vice president and chief financial officer. The Debtors' bankruptcy filing came two days after the Paragon Offshore group completed its corporate and financial reorganization on July 18, 2017. The plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code substantially de-levered Paragon Offshore's ongoing business, eliminating approximately $2.3 billion of secured and unsecured debt. R1 RCM: S&P Assigns 'B-' Corporate Credit Rating, Outlook Stable ---------------------------------------------------------------- R1 RCM Inc., a provider of revenue cycle management (RCM) services to health care providers, is acquiring the health care division of Intermedix Corp., consisting of its physician and EMS RCM, practice management, and analytics businesses, in a transaction valued at approximately $460 million. The capital structure will include a $295 million first-lien secured credit facility, consisting of a $25 million revolving credit facility (undrawn at transaction close), a $270 million first-loan term loan, and $110 million subordinated paid-in-kind (PIK) toggle notes. S&P Global Ratings said it assigned its 'B-' corporate credit rating to Chicago-based R1 RCM Inc. The outlook is stable. S&P said, "At the same time, we assigned our 'B' issue-level rating and '2' recovery rating to the company's $295 million first-lien credit facility, which consists of a $25 million revolving credit facility due 2023 (undrawn at close) and a $270 million first-lien term loan B due 2025. The '2' recovery indicates our expectation for substantial (70%-90%; rounded estimate: 70%) recovery for the first-lien debtholders in the event of default." The ratings on R1 reflects the company's small scale and narrow market focus in the fragmented and highly competitive health care information technology (HCIT) industry, the high upfront nature of startup costs in taking on new clients, the correlated lack of significant cash flows, and the company's relatively short operating track record. The fact that R1's main client, Ascension, which currently accounts for some 90% of the company's revenues, is a significant owner of R1 and is under a multiyear service agreement with the company partially mitigates these issues. R1 offers end-to-end revenue cycle management (RCM) services to health care providers, including patient registration, insurance and benefit verification, medical treatment documentation and coding, bill preparation, and collections from patients and payers. S&P said, "The stable outlook reflects our expectation that, with a large portion of revenues under multiyear contracts with Ascension, the company will be able to implement its new business model and improve EBITDA and cash flow-based credit metrics over the coming 18 months. "We could lower the rating if the company in unable to execute on its plan and turn EBITDA positive, generating consistent cash flow deficits, weakening liquidity, and increasing the likelihood that it will be unable to pay its fixed costs over the short term. We could also lower the rating if competition in the higher-margin, fragmented RCM industry increases, or if a shift occurs in medical service outsourcing trends with hospitals bringing these services back in house, leading to cash flow deficits. "We would consider a higher rating if the company is able to execute on its plans and health care providers take advantage of the value proposition of increased revenue yields and cost reduction that RCM services can provide. We would expect this to lead to consistent revenue growth and sustained leverage below 7x on an S&P Global Ratings-adjusted basis." RAIN TREE HEALTHCARE: Appeal from Case Dismissal Not Equitably Moot ------------------------------------------------------------------- Appellant Rain Tree Healthcare of Winston-Salem, LLC, in the appeals case captioned RAIN TREE HEALTHCARE OF WINSTON-SALEM, LLC, Appellant, v. J & F PARTNERS, LLC, and WILLIAM P. MILLER, Appellees, No. 1:17CV546 (M.D.N.C.) filed a voluntary petition for Chapter 11 Bankruptcy in the United States Bankruptcy Court for the Middle District of North Carolina. The bankruptcy court granted a motion to dismiss the bankruptcy case. Rain Tree then appealed to the District Court. Appellee J & F Partners, LLC filed an amended motion to dismiss the appeal on the grounds that Rain Tree's appeal is equitably moot. Upon analysis, District Judge William L. Osteen, Jr. denies J & F's amended motion to dismiss appeal. J & F claims that Rain Tree's appeal is subject to dismissal as equitably moot. J & F contends that the relief Rain Tree requests -- "a reinstitution of the Chapter 11 business reorganization case -- is no longer possible due to the fact that Rain Tree's lease has been legally terminated and Rain Tree has been evicted from the Premises." J & F asserts that "[t]here is simply no going concern to preserve; no business to reorganize." Rain Tree, on the other hand, asserts that the relief it requests, "a reinstitution of the [sic] of its Chapter 11 case can be granted. Although, [it] has been evicted from the leased premises, [it] has the ability to reoccupy the premises and operate the business in the same or similar fashion as the business has been operating[sic]." In deciding the case, the Court referred to the Mac Panel factors: 1) whether the appellant sought and obtained a stay; (2) whether the reorganization plan or other equitable relief ordered has been substantially consummated; (3) the extent to which the relief requested on appeal would affect the success of the reorganization plan or other equitable relief granted; and (4) the extent to which the relief requested on appeal would affect the interests of third parties. The Mac Panel factors, taken together, weigh against a finding of equitable mootness. Moreover, the ultimate question before the court, which the factors assist it in considering, is "whether judicial relief on appeal can, as a pragmatic matter, be granted." While J & F, the party carrying the burden, presents information to support that Rain Tree has been evicted from the premises in question, it does not present any information to the court as to (a) whether the premises has since been leased or sold to a third party or (b) whether the lease is Rain Tree's only asset that might be affected by any relief ordered by this court. Rain Tree's argument, that it might be able to reoccupy the premises, is entirely unsupported, but ultimately, it is J & F's burden to establish mootness. While in no way expressing an opinion as to the likelihood of Rain Tree's success on the merits of this appeal, the court, on the record before it, cannot conclude that the appeal is equitably moot. A copy of the Court's Memorandum Opinion and Order dated March 22, 2018 is available at https://is.gd/Mx3s18 from Leagle.com. RAIN TREE HEALTHCARE OF WINSTON SALEM, LLC, Debtor, represented by ROBERT LEWIS, JR. -- lewis@gorlaw.com -- GODON & MELUN, LLC. RAIN TREE HEALTHCARE OF WINSTON SALEM, LLC, Appellant, represented by ROBERT LEWIS, JR. , GODON & MELUN, LLC. J&F PARTNERS, LLC, Appellee, represented by CONSTANCE L. YOUNG -- constance.young@wbd-us.com -- WOMBLE BOND DICKINSON (US) LLP. WILLIAM P. MILLER, Appellee, represented by ROBERT E. PRICE, JR. , U. S. BANKRUPTCY COURT. About Rain Tree Healthcare Rain Tree Healthcare of Winston Salem, LLC, is a limited liability corporation headquartered in Charlotte, North Carolina, and is engaged in the management and operation of an adult care home for the mentally and physically disabled in Winston Salem, North Carolina. Rain Tree Healthcare of Winston Salem filed a Chapter 11 petition (Bankr. M.D.N.C. Case No. 17-50375) on April 1, 2017. Reema Owens, managing member/organizer, signed the petition. At the time of filing, the Debtor estimated assets and liabilities between $500,000 and $1 million. The Debtor's counsel is Robert Lewis, Jr., Esq., at Gordon & Melun, PLLC. The Debtor's accountant is John Edward Brown, CPA. The Assistant U.S. Bankruptcy Administrator, Robert E. Price, Jr., has appointed Victor Orija of the State Long Term Care Ombudsman for the State of North Carolina, as Patient Care Ombudsman for the Debtor. ROCKY PINE: Court Approved Continued Cash Collateral Use -------------------------------------------------------- Judge Mary Ann Whipple of the U.S. Bankruptcy Court for the Northern District of Ohio, on March 29, 2018, has entered a fourth interim order authorizing Rocky Pine Farms, LLC to use cash collateral during the period from the date of this Interim Order through and including the earlier of: (i) date of the Second Interim Order; or (ii) the Termination Date of March 30, 2018, solely in accordance with the Budgets and the other terms and conditions set forth in the Order. A further hearing on the second interim use of Cash Collateral will be held on May 31, 2018 at 10:00 a.m. The Debtor admits that the outstanding balance of its prepetition indebtedness is approximately $747,954, plus accrued and unpaid interest, fees, and expenses in accordance with the Pre-petition Loan Documents. To secure their respective interests in the collateral, the Lenders are granted a continuing security interest and lien in all property of the Debtor to the extent to which, and under the same terms and conditions, the Lenders held an interest in the Debtor's property at the commencement of this case. The Adequate Protection Liens granted to the Lenders will have the same relative priority as the Pre-petition Liens held by the Lenders as of the Petition Date. A full-text copy of the Fourth Interim Order is available at http://bankrupt.com/misc/ohnb17-32918-63.pdf About Rocky Pine Farms Founded 2007, Rocky Pine Farms, LLC, is a small organization in the crop farms industry. Rocky Pine Farms, based in Tiffin, Ohio, filed a Chapter 11 petition (Bankr. N.D. Ohio Case No. 17-32918) on Sept. 12, 2017. The petition was signed by Patricia Nye, president. In its petition, the Debtor estimated $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. The Hon. Mary Ann Whipple presides over the case. Raymond L. Beebe, Esq., at Raymond L. Beebe Co., LPA, serves as bankruptcy counsel. An official committee of unsecured creditors has not been appointed in the Chapter 11 case. RYNARD PROPERTIES: Taps Pettit & Company as Accountant ------------------------------------------------------ Rynard Properties Hilldale, LP seeks approval from the U.S. Bankruptcy Court for the Western District of Tennessee to hire Pettit & Company, CPAS as its accountant. The firm will assist the Debtor in the preparation of the annual audit for 2017 and will provide other accounting services needed for the operation of its business. John Pettit, managing member of Pettit & Company and the accountant who will be providing the services, charges an hourly fee of $200. The firm will paid a fee of $15,000, plus reimbursement of expenses for the preparation of the 2017 audit report. Mr. Pettit disclosed in a court filing that he does not hold or represent any interests adverse to the Debtor's estate. Pettit & Company can be reached through: John Pettit Pettit & Company, CPAS 435 E. Main Street, Suite 195 Greenwood, IN 46143 About Rynard Properties Hilldale Rynard Properties Hilldale LP, a Tennessee limited partnership, operates a 148-unit multifamily apartment complex of Section 8 housing named Hilldale Apartments in the Frayser area of Memphis, Tennessee, and currently has LEDIC operating the complex as leasing agent. Rynard Properties Hilldale LP, based in Fishers, IN, filed a Chapter 11 petition (Bankr. W.D. Tenn. Case No. 16-31248) on Dec. 7, 2016. The petition was signed by John Bartle, Chief Restr. Off. & Sec. for GP, Hilldale GP, LLC. The Debtor estimated $1 million to $10 million in both assets and liabilities at the time of the filing. The case is assigned to Judge Jennie D. Latta. The Debtor hired the Law Office of Toni Campbell Parker as its legal counsel; Foresite Realty Management, LLC as real property manager; and Foresite Realty Partners, LLC as real estate broker. SAN FRANCISCO SHIP: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------------- Debtor: San Francisco Ship Repair, Inc. fdba BAE Systems San Francisco Ship Repair, Inc. 201 Harris Ave Bellingham, WA 98225 Business Description: San Francisco Ship Repair, Inc. was formerly engaged in the business of ship and boat building and repairing before it ceased operations in May, 2017. The Company's parent, Puglia Engineering Inc., sought bankruptcy protection on April 14, 2018 (Bankr. W.D. Wash. Case No. 18-41324). Chapter 11 Petition Date: April 17, 2018 Case No.: 18-41350 Court: United States Bankruptcy Court Western District of Washington (Tacoma) Judge: Hon. Mary Jo Heston Debtor's Counsel: Steven J. Reilly, Esq. THE TRACY LAW GROUP PLLC 720 Olive Way Ste 1000 Seattle, WA 98101 Tel: 206-624-9894 Email: steven@thetracylawgroup.com Total Assets: $0 Total Liabilities: $8.03 million The petition was signed by Neil Turney, 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/wawb18-41350.pdf SOUTHEASTERN GROCERS: May Use Cash Collateral on Interim Basis -------------------------------------------------------------- The Hon. Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware has authorized Southeastern Grocers, LLC and its affiliated debtors to use cash collateral subject to the terms and conditions of the Interim Order and in accordance with the 13-week cash flow forecast. The Debtors are also authorized to maintain and, to renew, existing Letters of Credit issued or deemed issued under the ABL Facility prior to the Petition Date on an uninterrupted basis, in accordance with the same practices and procedures as were in effect prior to the Petition Date, in each case subject to the terms of the ABL Credit Agreement. Pre-petition, BI-LO, LLC, as borrower, BI-LO Holding, LLC, the ABL Lenders from time to time party thereto, Deutsche Bank AG New York Branch, as administrative agent and as collateral agent (the "ABL Agent"), and the Issuing Lenders, among others, are parties to that certain Amended and Restated ABL Credit Agreement, which provided for a revolving credit facility, including a letter of credit facility and a swingline facility, with aggregate commitments of $900 million. Pursuant to the ABL Documents, each of the Prepetition ABL Credit Parties pledged to Deutsche Bank, for itself and the other ABL Secured Parties, substantially all of its assets and property as security for the repayment of the Prepetition ABL Obligations owed by the Prepetition ABL Credit Parties. As adequate protection, Deutsche Bank, for the benefit of the ABL Secured Parties, the Secured Notes Agent, for the benefit of the Notes Secured Parties, and the Treasury Bank will each receive the following: (a) Replacement security interests in and liens upon all of the Debtors' post-petition property which in the relative priorities set forth in the Interim Order; (b) Additional liens on and security interests in all tangible and intangible property of the Debtors other than the property set forth above, whether existing on or as of the Petition Date or thereafter acquired; (c) An allowed superpriority administrative expense claim as provided for in Section 507(b) of the Bankruptcy Code against the Debtors. Subject only to the Carve-Out, and except as provided below, the Adequate Protection Superpriority Claims will have priority over any and all administrative expenses, adequate protection claims and other claims against the Debtors, now existing or hereafter arising, of any kind whatsoever, and over any and all administrative expenses or other claims arising under the Bankruptcy Code. (d) Adequate Protection Payments, as set forth below: I. The Debtors will pay in full, in cash and in immediately available funds all accrued and unpaid amounts (whether accrued prior to or after the Petition Date) in respect of the following: to (1) Deutsche Bank for (i) all reasonable and documented accrued and unpaid out-of-pocket professional fees and expenses payable to Deutsche Bank pursuant to the terms of the ABL Documents and (ii) all reasonable and documented accrued and unpaid fees and expenses of a financial or restructuring advisor retained by Deutsche Bank; (2) the Secured Notes Agent for all reasonable and documented accrued and unpaid out-of-pocket professional fees and expenses payable to the Secured Notes Agent pursuant to the terms of the Secured Notes Documents; (3) the Treasury Bank for all reasonable and documented accrued and unpaid out-of-pocket professional fees and expenses; and (4) the Ad Hoc Group for all reasonable and documented accrued and unpaid out-of-pocket professional fees and expenses. II. The Debtors will pay in full, in cash and in immediately available funds promptly upon the entry of the Interim Order, all accrued and unpaid amounts in respect of the following, and thereafter, as and when such payments would have come due: all interest, fees, and other amounts (other than principal), including Letter of Credit Fees and Facing Fees, as applicable, which will accrue and be payable at the rates and times provided for in each such Existing Agreements. However, the interest and Letter of Credit Fees on the Prepetition ABL Obligations will be paid at the default rate provided for in Section 2.08(c) of the ABL Credit Agreement during the Cases. III. The Debtors will make immediate cash payments (including cash collateralization of any Letters of Credit), to Deutsche Bank for the benefit of the ABL Secured Parties if for any reason and at any time the result of the Borrowing Base less the Aggregate Exposure less the Post-Carve-Out Notice Cap less the Carve-Out Reserve Estimate will be less than $75,000,000, in an amount equal to such deficiency. IV. The Debtors will make payments in an amount equal to the Treasury Exposure as and when due under the Treasury Services Documents. The Debtors will provide Deutsche Bank, the Secured Notes Agent, the Treasury Bank and counsel to the Ad Hoc Group with a Borrowing Base Certificate (showing the Borrowing Base as of the end of the immediately preceding Week), adjusted for the Post-Carve-Out Notice Cap and the Carve-Out Reserve Estimate every Monday until a Termination Event occurs and at the time of the consummation of any Asset Sale involving ABL Priority Collateral where the Net Sale Proceeds such ABL Priority Collateral (and such Replacement Collateral) are in excess of $2,500,000. In addition, with respect to any store that is in the process of being liquidated, (i) the Cash Collateral Borrowing Base Certificate delivered the Week immediately preceding the commencement of such liquidation will exclude 25% of the inventory at such store, (ii) the next weekly Cash Collateral Borrowing Base Certificate to be delivered will exclude 30% of the inventory at such store, (iii) the weekly Cash Collateral Borrowing Base Certificate delivered subsequent to the one referred to in preceding clause (ii) will exclude 50% of the inventory at such store, and (iv) the weekly Cash Collateral Borrowing Base Certificate delivered subsequent to the one referred to in preceding clause (iii) will exclude all of the inventory located at such store. The final hearing to consider entry of the final authorization for the Debtors' use of cash collateral is scheduled for April 24, 2018, at 2:00 p.m. (EST). Any party in interest objecting to the entry of the proposed Final Order will file and serve written objections no later than April 17, 2018 at 4:00 p.m. (EST). A full-text copy of the Interim Order is available at: http://bankrupt.com/misc/deb18-10700-133.pdf About Southeastern Grocers Southeastern Grocers, LLC, (SEG), the parent company and home of BI-LO, Fresco y Mas, Harveys Supermarket and Winn-Dixie grocery stores, is one of the largest conventional supermarket companies in the U.S. SEG grocery stores, liquor stores and in-store pharmacies serve communities throughout the seven southeastern states of Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina and South Carolina. BI-LO, Fresco y Mas, Harveys Supermarket and Winn-Dixie are well known and well-respected regional brands with deep heritages, strong neighborhood ties, proud histories of giving back, talented and caring associates and strong commitments to providing the best possible quality and value to customers. Their Web sites are http://www.bi-lo.com/, http://www.frescoymas.com/, http://www.harveyssupermarkets.com/and http://www.winndixie.com/ BI-LO and its affiliates filed for Chapter 11 bankruptcy protection on March 23, 2009 (Bankr. D. S.C. Case No. 09-02140). BI-LO emerged from bankruptcy in May 2010 with Lone Star Funds remaining as majority owner. Winn-Dixie Stores, Inc., sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 05-11063, transferred April 14, 2005, to Bankr. M.D. Fla. Case Nos. 05-03817 through 05-03840) on Feb. 21, 2005. In December 2011, BI-LO Holdings signed a deal to acquire all of the outstanding shares of Winn-Dixie Stores stock in a merger. Holdings was later renamed Southeastern Grocers. On March 27, 2018, Southeastern Grocers, LLC and 26 affiliated debtors sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 18-10700). SEG commenced Chapter 11 cases to seek confirmation of a prepackaged chapter 11 plan that will cancel their unsecured notes in exchange for 100% of the equity of the reorganized company. The Debtors have requested joint administration of the cases. The Honorable Mary F. Walrath oversees the cases. Weil, Gotshal & Manges LLP is serving as legal counsel to the Debtors, Evercore is serving as their investment banker, and FTI Consulting Inc. as restructuring advisor. Prime Clerk LLC is the claims and noticing agent. Morrison & Foerster LLP is serving as legal counsel and Moelis & Company LLC is serving as financial advisor to an ad hoc group of holders of Unsecured Notes and 9.25% Senior Secured Notes due 2019. SOUTHERN INYO: Unsecureds to Get $100K Under Amended Plan --------------------------------------------------------- Southern Inyo Healthcare District filed a second amended disclosure statement and plan for adjustment of debts proposing to repay obligations under the Plan with operational revenues as well as additional revenues derived from expanded operations, potential litigation recoveries, and increases to parcel and transient occupancy taxes. The Debtor also moved the expected effective date of the Plan from March 2018 to January 2019. Class 1E, comprised of the Disputed Claim of Healthcare Resource Group, will not receive any distributions under the Plan unless and until a court of competent jurisdiction enters a Final Order allowing the HRG Claim or HRG returns any and all avoidable transfers. If the HRG Claim is adjudged valid, enforceable and secured in whole or in part and/or HRG returns any and all avoidable transfers, the District will make periodic payments to HRG until the Class 1E Claim is paid in full with interest. Under the Plan, the payments on account of the Class 1E Claim will begin in the first full month following the allowance of the HRG Claim and/or the return of any and all avoidable transfers. If deemed an Allowed Claim, HRG will receive monthly payments in the approximate amount of $2,020 per month over the life of the Plan, which equates to the full amount of the Claim plus interest at a rate of 3.25% per annum. The treatment of Class 1G will depend on the outcome of the ViHF Adversary. If the District succeeds in disallowing the ViHF Claim in its entirety, Class 1G will not receive any distributions under the Plan. If the Bankruptcy Court allows the ViHF Claim as a subordinated claim and transfers any security interest(s) associated therewith to the District, the ViHF Claim will be treated in a separate class of subordinated Claims -- Class 5. Class 5 will receive a distribution equal to 3% of the total claims in the Class, which will be paid in a lump sum within 120 days after entry of an order subordinating the ViHF Claim. If the Bankruptcy Court allows the ViHF Claim as a Class 1G Claim, the District will pay the Allowed Secured Claim of ViHF in full within 120 days after entry of an order allowing the Effective Date. Holders of Class 3 Claims will receive a pro rata portion of $100,000, which will be paid as follows: (a) $25,000.00 on April 30, 2020; (b) $25,000 on December 31, 2020, or as soon thereafter as practicable; and (c) $25,000 on April 30, 2021, or as soon thereafter as practicable. In addition to these distributions, holders of Class 3 Claims will receive a pro rata portion of 25% of any recovery, net of fees, costs, and other administrative expenses associated therewith, from the proposed litigation against HCCA, which shall be paid no later than 120 calendar days following recovery thereof. A full-text copy of the Disclosure Statement is available at: http://bankrupt.com/misc/caeb16-10015-400.pdf About Southern Inyo Healthcare District Southern Inyo Healthcare District sought protection under Chapter 9 of the Bankruptcy Code (Bankr. E. D. Calif. Case No. 16-10015) on January 4, 2016. The petition was signed by Alan Germany, chief restructuring officer. At the time of the filing, Southern Inyo Healthcare District estimated its assets and debts at $1 million to $10 million. SPENCER TRANSPORTATION: Dist. Court Denies Bid to Dismiss BMO Suit ------------------------------------------------------------------ District Judge L. Scott Coogler denied Defendants Spencer Transportation, LLC, and Dwayne Haney's motion to dismiss for lack of subject matter jurisdiction the case captioned BMO HARRIS BANK, N.A., Plaintiff, v. SPENCER TRANSPORTATION LLC, et al., Defendants, No. 6:18-cv-00001-LSC (N.D. Ala.). The case arises out of an alleged breach of a Contract and Guaranty. On Jan. 9, 2015, Spencer Transportation entered into a Loan and Security Agreement with non-party General Electric Capital Corporation ("GECC") wherein GECC financed Spencer's purchase of a 2014 Volvo tractor-trailer. Pursuant to the Agreement, GECC lent Spencer a principal amount of $144,391.80. Upon GECC financing of the purchase, Spencer began making monthly payments to GECC. To provide additional security to GECC, Haney executed a Continuing Guaranty whereby he agreed to be jointly and severally liable to GECC for Spencer's obligations under the Agreement. GECC perfected its security interest in the Collateral. On Dec. 1, 2015, GE Capital US Holdings, Inc., as a successor in interest to GECC, assigned all of its rights, title and interest in the Agreement to BMO. In August of 2016, Spencer defaulted under the Agreement by failing to pay amounts owed. The Agreement contains an acceleration clause and despite demands, Spencer failed to cure the default. In addition, bankruptcy is listed in the Agreement as an event of default, and in January of 2017, Spencer defaulted by filing for bankruptcy under Chapter 11 in the Northern District of Alabama. During the bankruptcy case, Spencer made one adequate protection payment of $2,835.76. The bankruptcy case was dismissed in October of 2017, without confirming a plan of reorganization. In the Complaint, BMO avers the Defendants are indebted under the agreements in the total amount of $106,643.74, including the principal amount of $85,898.84. The amount in controversy thus exceeds the jurisdictional amount by over $10,000--exclusive of interest and costs. Defendants argue, without reference to any statute or case law, that the amount in controversy in this case would be less than $100,000 if the alleged value of unliquidated collateral is credited to the amount due, and additionally that the fair market value of the Collateral should be deducted from the amount in controversy. Failure to cite authority waives an argument. In sum, facts alleged in the Complaint, considered along with the accompanying attachments, are sufficient to demonstrate that the requisite amount in controversy of more than $75,000 exclusive of interest and costs required for federal diversity jurisdiction has been met. As such, the Court has subject matter jurisdiction over the action. A copy of the Court's Memorandum of Opinion dated March 22, 2018 is available at https://is.gd/eLRSCZ from Leagle.com. BMO Harris Bank NA, Plaintiff, represented by Philip Montgomer Johnson -- philip.johnson@huschblackwell.com -- HUSCH BLACKWELL, LLP. Spencer Transportation LLC & Dwayne Haney, Defendants, represented by Tim R. Wadsworth, TIM R. WADSWORTH LAW OFFICES PC. About Spencer Transportation Spencer Transportation, LLC, filed a Chapter 11 petition (Bankr. N.D. Ala. Case No. 17-70012), on Jan. 4, 2017. The petition was signed by its Manager, Dwayne F. Haney. At the time of filing, the Debtor had less than $50,000 in estimated assets and $500,000 to $1 million in estimated liabilities. The Debtor is represented by Lee R. Benton, Esq., at Benton & Centeno, LLP. SPRUHA SHAH: Allowed Access to Cash Collateral Through April 30 --------------------------------------------------------------- The Hon. Deborah L. Thorne of the U.S. Bankruptcy Court for the Northern District of Illinois has signed a ninth interim order authorizing Spruha Shah, LCC, and its debtor-affiliates to use the cash collateral of MB Financial Bank through and including April 30, 2018. As reported in the Troubled Company Reporter on Feb. 9, 2018, the Court had given its seventh interim order authorizing the Debtors to use cash collateral over the objection of MB Financial. MB Financial has continued to object on the use of cash collateral but the Court declared that at this time MB Financial's security interest is adequately protected by virtue of an equity cushion as the value of the Debtors' assets exceeds the secured claims against the same, although the extent of that equity cushion remains to be determined and MB Financial reserves the right to present evidence to demonstrate that the prepetition debt due MB exceeds the value of MB Financial's interests in the Debtors' assets. Judge Thorne held that the Debtors are authorized to use cash collateral conditioned on these terms and conditions: (a) Spruha Shah, LLC, must make $11,034 adequate protection payments, of which $4,571 are to be deposited into escrow for the payment of real estate taxes, on or before April 15, 2018; (b) Sneh and Sahil Enterprises, Inc. must make $2,100 adequate protection payment to MB Financial, on or before April 15, 2018; (c) MB Financial is granted post-petition replacement liens in the Debtors' property to the extent that the value of their prepetition cash-collateral diminishes postpetition; (d) The Debtors are authorized to pay from the funds in their Debtor-in-Possession operating accounts only: (i) those types of expenditures specified in the Budgets for the applicable periods set forth in the Budget and (ii) in the amounts set forth for each line item expenditure in the Budget. The Budget provides total expenditures of approximately $62,919. (e) The Debtors will not use, sell or otherwise dispose of any of Debtors' assets, except in the ordinary course of their business, without further order of the Court; (f) The Debtors agree not to incur any further indebtedness other than in the ordinary course of business, grant or provide liens, or guaranty other obligations, without the prior written consent of MB Financial and the Court; (g) The Debtors will not make any cash payments for labor and will make all payroll withholding payments or provide for 1099 reporting of any amounts paid to non-regular employees or independent contractors; (h) The Debtors will maintain all insurance coverage requirements pursuant to the provisions of its existing agreements with MB Financial, including maintaining MB as loss payee under Debtors' property insurance policy on the Premises, and will promptly provide MB with a certificate of insurance upon request; (i) The Debtors will properly maintain the Premises in good repair and properly manage such Premises; and (j) The Debtor will permit MB Financial to inspect, upon reasonable notice, Debtors' books and records. A copy of the Ninth Interim Order and Approved Budget is available at: http://bankrupt.com/misc/ilnb17-18858-90.pdf About Spruha Shah Sneh and Sahil Enterprises, Inc. -- http://www.arlingtonrental.com/ -- does business under two assumed names, as follows: (a) Arlington Rental, which rents out party equipment and supplies, like tents, portable dance floors, tables chairs and other catering needs, and (b) R Lederleitner Landscape, provides landscaping services. It operates from a commercial property owned by Spruha Shah. Spruha Shah, LLC, a single asset real estate as defined in 11 U.S.C. Section 101(51B), is the owner of the real property commonly known as 500 S. Hicks Rd., Palatine, Illinois. Spruha Shah, LLC, and Sneh and Sahil Enterprises filed Chapter 11 bankruptcy petitions (Bankr. N.D. Ill. Case Nos. 17-18858 and 17-18861) on June 22, 2017. The petitions were signed by Sanjay Shah, managing member. The cases are jointly administered under Spruha Shah's, with Judge Deborah L. Thorne presiding. At the time of filing, the Debtors estimated assets and liabilities ranging between $1 million to $10 million. The Debtors are represented by Timothy C. Culbertson, Esq., at the Law Offices of Timothy C. Culbertson. SUMMIT FINANCIAL: Allowed to Use Cash Collateral Until April 24 --------------------------------------------------------------- Judge Raymond B. Ray of the United States Bankruptcy Court for the Southern District of Florida has signed an agreed interim order authorizing Summit Financial Corp to use cash collateral to continue operating its business through the date scheduled for the final hearing. A final hearing on the Cash Collateral Motion will be held on April 24, 2018 at 1:30 p.m. Pursuant to the Agreed Interim Order, the Debtor is required to diligently attempt to collect all of its pre-petition and post-petition accounts receivable and consumer loans and all other rights to payment of money and will cause all such collections remitted by its customers and other account obligors to be promptly deposited into the Debtor's collection accounts. As of the Petition Date, the Debtor was indebted and liable pursuant that certain Third Amended and Restated Loan and Security Agreement to certain financial institutions in their capacity as lenders and Bank of America, N.A., as administrative and collateral agent for revolving credit loans in the approximate principal amount of $101,382,098. The Debtor is required to pay to Bank of America interest that accrues on the unpaid principal balance of the pre-petition debt as and when due under the Pre-Petition Loan Agreement. Bank of America, for the benefit of the Pre-Petition Credit Parties, is granted valid and perfected replacement security interests in and liens on all of the Debtor's pre-petition and post-petition real and personal property. As adequate protection of its interest in the Pre-Petition Collateral, Bank of America, for the benefit of the Pre-Petition Credit Parties, is entitled to claims and other protections in an amount equal to the collateral diminution. Said adequate protection claims are allowed as superpriority administrative claims pursuant to the Bankruptcy Code and will have priority in payment over any and all administrative expenses of the kinds specified or ordered pursuant to any provision of the Code. Bank of America and its respective representatives and agents will be authorized to conduct onsite field examinations in order to inspect and evaluate the Debtor's property and financial records. The Debtor is also required to deliver to Bank of America all financial, collateral and other reporting, documents and information when required by the Pre-Petition Loan Documents. In addition, on each Wednesday, the Debtor will deliver to Bank of America a written comparison showing the Debtor's actual performance during the week ending on the previous Friday as compared to the projections for such calendar week in the Budget. Furthermore, the Debtor will maintain insurance in effect with respect to its operations and each of its properties in amounts and under terms and conditions consistent with the insurance coverage in effect on the Petition Date, and in any event, in compliance with the Pre-Petition Loan Agreement and the guidelines of the Office of the U.S. Trustee. A full-text copy of the Agreed Interim Order is available at http://bankrupt.com/misc/flsb18-13389-36.pdf About Summit Financial Corp Summit Financial Corp -- https://www.summitfinancialcorp.org/ -- provides financing by purchasing and servicing retail installment sales contracts originated at franchised automobile dealerships and select independent used car dealerships located throughout Florida, Alabama, and Georgia. From its location in Plantation, Florida, Summit Financial provides financing for automobile loans for customers that fail to meet the standards of financing from conventional sources, such as most banks, credit unions and other national finance companies. The Company was founded in 1984. Summit Financial filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 18-13389) on March 23, 2018. In the petition signed by David Wheeler, vice president, the Debtor estimated $100 million to $500 million in assets and liabilities. Judge Raymond B Ray presides over the case. Douglas J. Jeffrey, Esq., at the Law Offices of Douglas J. Jeffrey, P.A. and Zach B. Shelomith at the law firm of Leiderman Shelomith Alexander + Somodevilla, PLL, serve as the Debtor's counsel. TAKATA CORP: Dist. Ct. OK's Proposed Restitution Fund Methodology ----------------------------------------------------------------- District Judge George Caram Steeh issued an order granting the Special Master's Request for Approval of the Revised Proposed Individual Restitution Fund Methodology and overruling the Defendant's objection in the case captioned UNITED STATES OF AMERICA, Plaintiff, v. TAKATA CORPORATION, Defendant, Case No. 16-CR-20810 (E.D. Mich.). Takata argues the Proposed Methodology should be rejected because it is based, in part, on the "intention of the prosecuting governmental authorities," rather than on the plain language of the Plea Agreement. The Court has already determined that the language of the Plea Agreement supports the Court's conclusion here that it is appropriate to limit the class of Eligible Claimants to the definition set forth by the Special Master in his Proposed Methodology. Takata argues the court should afford greater weight to its interpretation of the individual restitution claimants as defined by the Plea Agreement than to the government's interpretation because any ambiguities in the Plea Agreement must be resolved in favor of Takata. Takata correctly states that law that plea agreements are contractual in nature and courts may use traditional principles of contract law in interpreting and enforcing them. Furthermore, Takata is correct that ambiguities in plea agreements are to be construed against the government. Id. But here, the parties expressly contracted that the identity of individual claimants was left to the Special Master to identify in proposed findings of fact and recommendations to this Court. Accordingly, there is no ambiguity in the Plea Agreement. Because the Court does not base its holding here on a preference for the government's interpretation of the Plea Agreement over Takata's interpretation, the court rejects Takata's objection. Takata also argues that because the Special Master has not imposed any geographical limitation for restitution to the automotive manufacturers ("OEMs"), there is no rational basis for treating individuals differently. To the contrary, the Court finds that it reasonable to treat individuals differently than the OEMs. First, the Restitution Fund for the OEMs is significantly larger. The OEM Restitution Fund is $850,000,000 while the Individual Restitution Fund is only $125,000,000. The Special Master had identified less than 100 OEMs, whereas individual claimants even under the Special Master's definition, which sets forth a geographic and nationality limitation, could measure in the thousands. Finally, the court considers Takata's argument that a global definition of personal injury claimants is consistent with Takata's treatment of such claimants in its insolvency proceedings. Takata states that it is in the midst of rehabilitation proceedings in Japan, which have been formally recognized by the United States Bankruptcy Court, and its United States subsidiary and related entities are in Chapter 11 proceedings in the United States. Foreign claimants have remedies in the Takata bankruptcy. This matter involves a criminal prosecution brought by the United States in the United States District Court for a violation of the laws of the United States, and on behalf of persons of the United States. The fact that the foreign claimants may have recourse in the international bankruptcy proceedings does not alter this Court's decision to adopt the Special Master's recommendation that Eligible Claimants be defined domestically. A full-text copy of Judge Steeh's Order dated March 21, 2018 is available at https://is.gd/Dv48lY from Leagle.com. Eric D. Green, Special Master, represented by David J. Molton -- dmolton@brownrudnick.com -- Brown Rudnick LLP & Howard S. Steel -- hsteel@brownrudnick.com -- Brown Rudnick LLP. United States of America, Plaintiff, represented by Erin Shaw, U.S. Attorney's Office, Brian Kidd, U.S. Department of Justice Criminal Division, Fraud Section, Christopher D. Jackson, U.S. Department of Justice Criminal Division, Fraud Section & John K. Neal, United States Attorney's Office. About Takata Corp Japan-based Takata Corporation (TYO:7312) -- http://www.takata.com/en/-- develops, manufactures and sells safety products for automobiles. The Company offers seatbelts, airbags, steering wheels, child seats and trim parts. Headquartered in Tokyo, Japan, Takata operates 56 plants in 20 countries with approximately 46,000 global employees worldwide. The Company has subsidiaries located in Japan, the United States, Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea, China and other countries. Takata Corp. filed for bankruptcy protection in Tokyo and the U.S., amid recall costs and lawsuits over its defective airbags. Takata and its Japanese subsidiaries commenced proceedings under the Civil Rehabilitation Act in Japan in the Tokyo District Court on June 25, 2017. Takata's main U.S. subsidiary TK Holdings Inc. and 11 of its U.S. and Mexican affiliates each filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 17-11375) on June 25, 2017. Together with the bankruptcy filings, Takata announced it has reached a deal to sell all its global assets and operations to Key Safety Systems (KSS) for US$1.588 billion. Nagashima Ohno & Tsunematsu is Takata's counsel in the Japanese proceedings. Weil, Gotshal & Manges LLP and Richards, Layton & Finger, P.A., are serving as counsel in the U.S. cases. PricewaterhouseCoopers is serving as financial advisor, and Lazard is serving as investment banker to Takata. Ernst & Young LLP is tax advisor. Prime Clerk is the claims and noticing agent. The Debtors Meunier Carlin & Curfman LLC, as special intellectual property counsel. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel, KPMG is serving as financial advisor, Jefferies LLC is acting as lead financial advisor. UBS Investment Bank also provides financial advice to KSS. On June 28, 2017, TK Holdings, as the foreign representative of the Chapter 11 Debtors, obtained an order of the Ontario Superior Court of Justice (Commercial List) granting, among other things, a stay of proceedings against the Chapter 11 Debtors pursuant to Part IV of the Companies' Creditors Arrangement Act. The Canadian Court appointed FTI Consulting Canada Inc. as information officer. TK Holdings, as the foreign representative, is represented by McCarthy Tetrault LLP. The U.S. Trustee has appointed an Official Committee of Unsecured Trade Creditors and a separate Official Committee of Tort Claimants. The Official Committee of Unsecured Creditors has selected Christopher M. Samis, Esq., L. Katherine Good, Esq., and Kevin F. Shaw, Esq., at Whiteford, Taylor & Preston LLC, in Wilmington, Delaware; Dennis F. Dunne, Esq., Abhilash M. Raval, Esq., and Tyson Lomazow, Esq., at Milbank Tweed Hadley & McCloy LLP, in New York; and Andrew M. Leblanc, Esq., at Milbank, Tweed, Hadley & McCloy LLP, in Washington, D.C., as its bankruptcy counsel. The Committee has also tapped Chuo Sogo Law Office PC as Japan counsel. The Official Committee of Tort Claimants selected Pachulski Stang Ziehl & Jones LLP as counsel. Gilbert LLP will evaluate of the insurance policies. Sakura Kyodo Law Offices will serve as special counsel. Roger Frankel, the legal representative for future personal injury claimants of TK Holdings Inc., et al., tapped Frankel Wyron LLP and Ashby & Geddes PA to serve as co-counsel. Takata Corporation ("TKJP") and affiliates Takata Kyushu Corporation and Takata Services Corporation commenced Chapter 15 cases (Bankr. D. Del. Case Nos. 17-11713 to 17-11715) on Aug. 9, 2017, to seek U.S. recognition of the civil rehabilitation proceedings in Japan. The Hon. Brendan Linehan Shannon oversees the Chapter 15 cases. Young, Conaway, Stargatt & Taylor, LLP, serves as Takata's counsel in the Chapter 15 cases. * * * In February 2018, the U.S. Bankruptcy Court for the District of Delaware has confirmed the Fifth Amended Chapter 11 Plan of Reorganization filed by TK Holdings, Inc. ("TKH"), Takata's main U.S. subsidiary, and certain of TKH's subsidiaries and affiliates. TOTAL DIAGNOSTIX: Taps Kelly Hart & Hallman as Special Counsel -------------------------------------------------------------- Total Diagnostix Labs, LLC, seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to hire Kelly Hart & Hallman as its special counsel. The firm will represent the Debtor in four separate cases. Two of the cases involve disputes between the Debtor and Channel (H), Inc. over the use of intellectual property, and are pending in courts in the Northern District of Texas. The two other cases are pending in the 17th District Court and 342nd District Court of Tarrant County. The firm will charge these hourly rates: Bill Warren $405 Chase Medling $300 Legal Assistants $205 Kelly Hart is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: William N. Warren, Esq. Kelly Hart & Hallman 201 Main Street, Suite 2500 Fort Worth, TX 76102 Phone: (817) 878-3564 Fax: (817) 878-9280 E-mail: bill.warren@kellyhart.com About Total Diagnostix Labs Total Diagnostix Labs, LLC, operates a diagnostic center in Forth Worth, Texas. Total Diagnostix Labs sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 18-40938) on March 7, 2018. In the petition signed by Alan D. Meeker, chief executive officer, the Debtor estimated assets of $10 million to $50 million and liabilities of $50 million to $100 million. Judge Russell F. Nelms presides over the case. UTSA APARTMENTS 8: 5th Cir. Affirms Ruling Reducing Woodlark Claims ------------------------------------------------------------------- In UTSA Apartments 8, L.L.C.'s bankruptcy case, a consolidated appeal stems from the bankruptcy of 19 companies that were tenants-in-common of a student housing development in San Antonio, Texas, called The Reserve. Appellants are Woodlark UTSA Apartments, LLC, who was The Reserve's asset and property manager, and a related entity, UTSA Apartments, LLC, which also owned an interest in The Reserve. The U.S. Court of Appeals Fifth Circuit was asked to address the propriety of two rulings by the bankruptcy court concerning: (1) UTSA's share of net proceeds stemming from the sale of The Reserve to a third party during the bankruptcy proceedings, and (2) Woodlark's proof of claims against the bankruptcy estate. Appellants raise several issues involving the Bankruptcy Code and Texas fiduciary law. Upon deliberation, the Fifth Circuit reverses the bankruptcy court's reduction of UTSA's share of net proceeds but affirms the bankruptcy court's reduction of Woodlark's proof of claims. Appellants challenge two rulings by the bankruptcy court: (1) the reduction of UTSA's share of net proceeds from 21.17% to 3.14%, and (2) the reduction of Woodlark's proof of claims from $510,475,98 to $410,097.78. Appellants assert that the bankruptcy court erred in reducing the share of net proceeds payable to UTSA from 21.17% to 3.14%. The bankruptcy court gave two reasons for this reduction: (1) UTSA did not sign the Call Agreement, and (2) UTSA, and by association Woodlark, should not profit from Woodlark's breach of fiduciary duty in attempting to force the TICs to surrender their interest for no consideration when the Property was worth more than Woodlark maintained. Appellants argue that the bankruptcy court's equitable justification for reducing UTSA's share of the net proceeds was flawed because UTSA was never sued for breach of fiduciary duty nor was found to be a fiduciary of the other TICs. Thus, according to Appellants, the bankruptcy court's equitable remedy of reducing UTSA's share on the basis of Woodlark's breach of fiduciary duty could only have been based on the bankruptcy court's inherent equitable powers, which must be exercised in conformity with the Bankruptcy Code. Because, as discussed above, the reduction violated section 363(j)'s distribution mandate, Appellants assert that the bankruptcy court erred in reducing UTSA's share in this exercise of equitable power. The Court finds that the imposition of a constructive trust on the sale's proceeds resulting in UTSA's share being reduced violates the mandate of section 363(j) requiring distribution in accordance with the co-owners' interest. Given the serious procedural deficiencies, the lack of notice to UTSA regarding the imposition of a constructive trust, and the remedy's violation of the terms of the Code, the Court reverses the bankruptcy court's decision to reduce UTSA's share of net proceeds. In ruling on Woodlark's Breach of Duty Adversary, the bankruptcy court found that Woodlark breached its fiduciary duties to the TICs. In light of this breach, the court held that Woodlark would forfeit the unpaid asset management fees, unpaid property management fees, and the 4.5% transaction fee. Thus, the court granted Woodlark's proof of claims representing actual cash advances totaling $410,097.78 and disallowed the remainder of its claims. Woodlark challenges this decision on appeal, asserting that it is entitled to the full amount of its proof of claims totaling $510,475.89. Woodlark argues that the bankruptcy court's decision based on the breach of fiduciary duty claim was flawed because "it improperly based the burden of proof on Woodlark, it relied on non-existent appraisal testimony and it failed to find either harm to the Plaintiffs or benefit to the Defendant as required by Texas law." After the trial, the bankruptcy court found that (1) a fiduciary relationship existed between Woodlark and the Debtor TICs; and (2) Woodlark breached its fiduciary duties to the TICs by (i) making demands on the TICs to tender their ownership by claiming their interests were worth nothing based on a flawed appraisal, (ii) failing to keep up with the ad valorem tax litigation and tax protests, and (iii) issuing unnecessary cash calls. In other words, "Woodlark treated the [fiduciary] relationship as a typical contractual agreement in which both parties look out for their own financial interests first, and this was not such a contract." Based on these findings, the bankruptcy court specifically denied damages, but held that Woodlark would forfeit unpaid asset management fees, unpaid property management fees, and the 4.5% transaction fee. Given the bankruptcy court's refusal to impose damages in favor of requiring Woodlark to forfeit various fees as the result of its breach of fiduciary duties to the Debtor TICs, the bankruptcy court did not err in failing to find causation and damages because no such finding was required to support fee forfeiture under Texas law. The appeals case is UTSA APARTMENTS, L.L.C.; WOODLARK UTSA APARTMENTS, L.L.C., Appellants, v. UTSA APARTMENTS 8, L.L.C.; UTSA APARTMENTS 5, L.L.C.; UTSA APARTMENTS 9, L.L.C.; UTSA APARTMENTS 12, L.L.C.; UTSA APARTMENTS 13, L.L.C.; UTSA APARTMENTS 19, L.L.C.; UTSA APARTMENTS 23, L.L.C.; UTSA APARTMENTS 24, L.L.C.; UTSA APARTMENTS 25, L.L.C.; UTSA APARTMENTS 27, L.L.C.; UTSA APARTMENTS 28, L.L.C.; UTSA APARTMENTS 30, L.L.C.; UTSA APARTMENTS 34, L.L.C.; UTSA APARTMENTS 1, L.L.C.; UTSA APARTMENTS 4, L.L.C.; UTSA APARTMENTS 6, L.L.C.; UTSA APARTMENTS 15, L.L.C.; UTSA APARTMENTS 16, L.L.C.; UTSA APARTMETS 18, L.L.C., Appellees. UTSA APARTMENTS, L.L.C.; WOODLARK UTSA APARTMENTS, L.L.C., Appellants, v. UTSA APARTMENTS 8, L.L.C.; UTSA APARTMENTS 5, L.L.C.; UTSA APARTMENTS 9, L.L.C.; UTSA APARTMENTS 12, L.L.C.; UTSA APARTMENTS 13, L.L.C.; UTSA APARTMENTS 19, L.L.C.; UTSA APARTMENTS 23, L.L.C.; UTSA APARTMENTS 24, L.L.C.; UTSA APARTMENTS 25, L.L.C.; UTSA APARTMENTS 27, L.L.C.; UTSA APARTMENTS 28, L.L.C.; UTSA APARTMENTS 30, L.L.C.; UTSA APARTMENTS 34, L.L.C., Appellees. UTSA APARTMENTS, L.L.C.; WOODLARK UTSA APARTMENTS, L.L.C., Appellants, v. UTSA APARTMENTS 8, L.L.C.; UTSA APARTMENTS 5, L.L.C.; UTSA APARTMENTS 9, L.L.C.; UTSA APARTMENTS 12, L.L.C.; UTSA APARTMENTS 13, L.L.C.; UTSA APARTMENTS 19, L.L.C.; UTSA APARTMENTS 23, L.L.C.; UTSA APARTMENTS 24, L.L.C.; UTSA APARTMENTS 25, L.L.C.; UTSA APARTMENTS 27, L.L.C.; UTSA APARTMENTS 28, L.L.C.; UTSA APARTMENTS 30, L.L.C.; UTSA APARTMENTS 34, L.L.C., Appellees, No. 17-50893 (5th Cir.) . A full-text copy of the 5th Circuit's Decision dated March 27, 2018 is available at https://is.gd/qQzlte from Leagle.com. David S. Gragg -- dgragg@langleybanack.com -- for Appellee. Stephen W. Sather, for Appellant. Sara S. Murray -- smurray@langleybanack.com -- for Appellee. Eric B. Terry, for Appellee. About UTSA Apartments 8 UTSA Apartments 8, LLC, et al., are tenants in common ("TICs"), each holding fractional interests in The Reserve at UTSA. The Reserve is a student apartment complex serving the University of Texas at San Antonio and located in Northwestern quadrant of San Antonio. UTSA Apartments 8, LLC, et al., sought Chapter 11 protection (Bankr. W.D. Tex. Lead Case No. 15-52941) on Dec. 2, 2015. The TICs which have filed for protection under chapter 11 of the Bankruptcy Code, have an ongoing dispute with Woodlark UTSA Apartments, LLC which is the largest of the TICs and holds approximately 21% of the ownership of The Reserve. Woodlark was the original promotor and is currently responsible for the management of the apartment complex. The Debtors are represented by Allen M. DeBard, Esq., at Langley & Banack, Inc. VER TECHNOLOGIES: Taps Kurtzman Carson as Claims Agent ------------------------------------------------------ VER Technologies HoldCo LLC received approval from the U.S. Bankruptcy Court for the District of Delaware to hire Kurtzman Carson Consultants LLC as its claims and noticing agent. The firm will oversee the distribution of notices and will assist in the maintenance, processing and docketing of proofs of claim filed in the Chapter 11 cases of the company and its affiliates. Prior to the Petition Date, the Debtors provided Kurtzman a retainer in the sum of $50,000. Robert Jordan, senior director of Kurtzman's Corporate Restructuring Services, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Robert Jordan Kurtzman Carson Consultants LLC 2335 Alaska Avenue El Segundo, CA 90245 Tel: (310) 823-9000 About VER Techonologies VER Technologies is a global provider of production equipment and engineering support. With the world's largest inventory of rental equipment, VER supplies the most advanced technology to a broad array of clients in the TV, cinema, live events, broadcast and corporate markets. Clients rely on VER's depth of experience in Broadcast, Audio, Video, Lighting, LED, Cameras, Rigging, Media Servers, Fiber and more. With 35 offices across North America and Europe, 24/7 support, and unparalleled expertise, VER can support any live or taped production anywhere in the world. VER Technologies, et al., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. Del. Case No. 18-10834) on April 5, 2018. In its petition signed by Digby Davies, CEO. VER Technologies HoldCo disclosed $0 to $50,000 in assets and $ $10 million to $50 million in liabilities. The Hon. Kevin Gross presides over the case. Kirkland & Ellis LLP and Klehr Harrison Harvey Branzburg LLP are serving as VER's legal counsel, AlixPartners LLP is serving as its restructuring advisor and PJT Partners is serving as its financial advisor. Skadden, Arps, Slate, Meagher & Flom LLP, and Perella Weinberg Partners are serving as advisors to Bank of America Merrill Lynch. FTI Consulting and Morgan, Lewis & Bockius LLP are serving as advisors to GSO Capital Partners. VERMILION ENERGY: S&P Puts BB- CCR on Watch Pos. Amid Spartan Deal ------------------------------------------------------------------ S&P Global Ratings said it placed its 'BB-' long-term corporate credit rating and 'BB-' senior unsecured debt rating on Vermilion Energy Inc. on CreditWatch with positive implications. The '3' recovery rating on the company's senior unsecured debt is unchanged, and represents S&P's expectation of meaningful (50%-70%; rounded estimate 65%) recovery for the senior unsecured noteholders in a default scenario. The CreditWatch placement follows Vermilion's announcement that it will acquire Spartan Energy Corp. for about C$1.4 billion, composed of C$1.23 billion in Vermilion shares and the assumption of approximately C$175 million in debt. The company expects to close the transaction during second-quarter 2018 subject to customary closing conditions, including receipt of regulatory, Canadian court, and shareholder approval. S&P believes the transaction could be credit positive for Vermilion because the combined entity would have large scale and scope, with an increase of 32% on average daily production, 41% increase in net proved reserves, and higher exposure to North American light oil. Spartan reported an average daily production of 22,200 barrels of oil equivalent (boe) per day (91% of this being light oil and natural gas liquids), and net proved reserves of 65 million boe in 2017. Spartan's unit cash costs, including general and administrative expenses, were about C$18.3 per boe in 2017, which is slightly higher than Vermilion's C$13.75 per boe during the same period because of Spartan's product mix. However, S&P believes the combined entity's profitability, as measured by unit earnings before interest, would remain aligned with the global peer's average due to Spartan's high netback from the light oil segment. Spartan's assets are located in the southeast region of Saskatchewan, close to Vermilion's existing assets in the Mississippian formation. S&P said, "We believe the transaction might also enhance Vermilion's financial risk profile. In our view, the combined assets could lead to stronger credit metrics, with pro forma three-year (2018-2020) weighted-average adjusted funds from operation-to-debt likely increasing to the 45%-60% range from our base-case scenario of 30%-45%. We expect the combined entity to maintain three-year weighted-average adjusted free operating cash flow-to-debt of 15%-25% and discretionary cash flow-to-debt of 0%-5%, in line with our forecast. "We believe the '3' recovery rating would be unchanged after the transaction, so there would be a corresponding uplift to the debt rating in tandem with a higher corporate credit rating. "The CreditWatch placement reflects our view that there is a one-in-two likelihood of a positive rating action if the transaction closes under the proposed terms, because this would likely improve Vermilion's business risk and financial risk profiles, potentially resulting in a one-notch upgrade. "We expect to resolve the CreditWatch by the end of second-quarter 2018, by which point the transaction should be complete." WESTPORT HOLDINGS: Court Conditionally Approves Plan Disclosures ---------------------------------------------------------------- Judge Michael G. Williamson of the U.S. Bankruptcy Court for the Middle District of Florida has conditionally approved the disclosure statement explaining the joint plan of liquidation proposed by Westport Holdings Tampa, Limited Partnership, and Westport Holdings Tampa, II, Limited Partnership, and the Official Committee of Unsecured Creditors. About Westport Holdings Tampa, Limited Partnership Westport Holdings Tampa, dba University Village, is a care retirement community in Tampa, Florida. It offers residents villas, apartments, an assisted living facility and a skilled nursing care center for their end of life needs. Westport Holdings Tampa, Limited Partnership and Westport Holdings Tampa II, Limited Partnership filed Chapter 11 petitions (Bankr. M.D. Fla. Case Nos. 16-8167 and 16-8168) on Sept. 22, 2016. Scott A. Stichter, Esq., and Stephen R. Leslie, Esq., at Stichter Riedel Blain & Postler, P.A., represent the Debtors as bankruptcy counsel. The Debtors tapped Broad and Cassel as special counsel for healthcare and related litigation matters. Jeffrey Warren was appointed as examiner in the Debtors' cases. He is represented by Bush Ross, P.A. The Office of the U.S. Trustee appointed an official committee of unsecured creditors on Oct. 11, 2016, and an official committee of resident creditors on Dec. 29, 2016. The resident committee is represented by Jennis Law Firm. WOOTON GROUP: Taps Newmark Grubb as Real Estate Broker ------------------------------------------------------ Wooton Group, LLC seeks approval from the U.S. Bankruptcy Court for the Central District of California to hire a real estate broker. The Debtor proposes to employ Newmark Grubb Pearson Commercial in connection with the sale or lease of its real property located at 2945-2965 S. Angus Avenue, Fresno, California. Newmark will get a 4% commission for its services. The price for the property is $7.6 million. Troy McKenney, senior vice-president of Newmark and the real estate broker who will be providing the services, disclosed in a court filing that his firm is a "disinterested person" as defined in section 101(14) of the Bankruptcy Code. Newmark can be reached through: Troy McKenney Newmark Grubb Pearson Commercial 7480 N. Palm Avenue, Suite 101 Fresno, CA 93711 Phone: (559) 432-6200 Fax: (559) 432-2938 Email: info@pearsonrealty.com About Wooton Group Wooton Group, LLC, is a California limited liability company formed in 1996 which owns and manages real property. Wooton Group first sought bankruptcy protection (Bankr. C.D. Cal. Case No. 12-31323) in June 2012. Wooton Group again sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 18-11727) on Feb. 16, 2018. In its petition signed by Mark Slotkin, managing member, the Debtor estimated assets and liabilities of $10 million to $50 million. Judge Neil W. Bason presides over the case. Leslie Cohen Law, PC, is the Debtor's legal counsel. [*] Getzler Announces Promotions of Luke Andrews, Jubin Pandey -------------------------------------------------------------- Getzler Henrich & Associates LLC announced the promotions of Luke Andrews and Jubin Pandey to Associate Director. Mr. Andrews joined Getzler Henrich in 2015 and specializes in financial and cash flow modeling, quantitative and statistical data analyses, and efficiency improvements through business tool development. Since joining the firm, he has been involved in over twenty-five engagements in industries including: healthcare, retail, fashion, real estate, construction, manufacturing, distribution, asset management, professional services, apparel, and food, among others. He has advised management teams through financial and managerial crises, complex operational and financial restructurings, and both micro and macro strategic planning. Mr. Pandey has seven years of wide-ranging, global experience in restructuring, private equity, and investment banking. At Getzler Henrich, he has been involved with numerous engagements helping management at middle-market companies navigate through financia crisis and improve business performance through data-driven insights and best practice implementation. Before joining Getzler Henrich in 2016, he was a private equity analyst at Warburg Pincus where he evaluated investments in middle-market companies in India specializing in financial and strategic analysis, financial modeling, creating and executing detailed diligence plans, and portfolio management. Previously, Mr. Pandey was an investment banking analyst with Nomura's Asia-Pacific TMT team. Founded in 1968, Getzler Henrich & Associates LLC -- https://getzlerhenrich.com -- is one of the nation's oldest and most respected names in middle market corporate turnaround and restructuring. Having successfully restructured over a thousand companies in dozens of industries throughout the world, the firm has expanded into complementary services that enhance the processes needed to achieve the aggressive growth targets of healthy businesses. [*] Liebman Named A&M North American Restructuring Practice Co-Head ------------------------------------------------------------------- Global professional services firm Alvarez & Marsal (A&M) appointed Managing Director Marc Liebman to the role of Co-Head of the Western Region for its North American Restructuring practice, effective at the beginning of this fiscal year. "Marc has spent his entire career in the finance and restructuring industries, having most recently served as a leader in our corporate finance practice for the past 15 years. His breadth of experience and deep roots within A&M and the restructuring community make him a natural choice for this leadership position," said Jeff Stegenga, Managing Director and national leader of A&M's North American Restructuring practice. Mr. Stegenga continued, "Historically, restructuring activity has been robust in the west and we expect that trend to continue. As western region co-heads, Marc and A&M Managing Director Jon Goulding strengthen our ability to solve complex financial issues facing our clients based there and across the country." Mr. Liebman's restructuring experience encompasses more than 20 years advising stressed and distressed companies and their creditors. He specializes in the development and implementation of strategic, financial and operating plans for over-leveraged and undercapitalized companies in both out-of-court and in Chapter 11 contexts. Mr. Liebman has assisted companies in developing business plans, implementing strategic and operational restructuring initiatives, operating with liquidity constraints, raising capital, monetizing assets, managing creditor relationships and negotiating capital structure restructuring strategies. His past clients include AMERCO/U-Haul, CSK Auto, Euro Fresh Farms, Forbes Energy, Fresh & Easy Markets, Grubb & Ellis, Nellson Nutraceutical, Regal Cinema, Top-Flite Golf, Skopos Financial, Washington Group and William Lyon Homes. Mr. Liebman also currently serves on the firm's valuation committee. Mr. Liebman began his career in the corporate restructuring group at a Big Four firm where he advised clients in financial distress. Prior to founding Alvarez & Marsal Securities, Mr. Liebman was an investment banker with DLJ and Credit Suisse in Los Angeles. Mr. Liebman earned a bachelor's degree in business administration, with a concentration in accounting, from the University of Notre Dame and an MBA in finance, from the University of Chicago. He is a member of the Turnaround Management Association, the American Bankruptcy Institute and the Young Presidents' Organization. About Alvarez & Marsal Privately held since its founding in 1983, Alvarez & Marsal (A&M) -- http://www.alvarezandmarsal.com-- A&M is a global professional services firm that provides advisory, business performance improvement and turnaround management services. With over 3000 people across four continents, it delivers tangible results for corporates, boards, private equity firms, law firms and government agencies facing complex challenges. [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re El Pino Trucking, Inc. Bankr. W.D. Ark. Case No. 18-70932 Chapter 11 Petition filed April 6, 2018 See http://bankrupt.com/misc/arwb18-70932.pdf represented by: Donald A. Brady, Esq. BRADY & CONNER, PLLC E-mail: aadrbk@gmail.com In re Miller's Delicatessen, Inc. Bankr. N.D. Cal. Case No. 18-30391 Chapter 11 Petition filed April 6, 2018 See http://bankrupt.com/misc/canb18-30391.pdf represented by: James T. Cois, Esq. LAW OFFICES OF JAMES T. COIS E-mail: JTCois@aol.com In re Pumpkinvine Cafe LLC Bankr. N.D. Ind. Case No. 18-10575 Chapter 11 Petition filed April 6, 2018 See http://bankrupt.com/misc/innb18-10575.pdf represented by: E. Foy McNaughton, Esq. MCNAUGHTON LAW GROUP, LLC E-mail: foy@debt-relief.in In re La Cross Glass, Inc. Bankr. E.D. Mich. Case No. 18-20674 Chapter 11 Petition filed April 6, 2018 See http://bankrupt.com/misc/mieb18-20674.pdf represented by: Rozanne M. Giunta, Esq. WARNER NORCROSS & JUDD LLP E-mail: rgiunta@wnj.com In re Little Tots Academy, LLC Bankr. D.N.J. 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Case No. 18-10544 Chapter 11 Petition filed April 11, 2018 represented by: Vaughn C. Taus, Esq. E-mail: tauslawyer@gmail.com In re Rodolfo Alvarez Bankr. C.D. Cal. Case No. 18-10889 Chapter 11 Petition filed April 11, 2018 represented by: Stephen L. Burton, Esq. E-mail: steveburtonlaw@aol.com In re Edgar Eduardo Esparza Bankr. C.D. Cal. Case No. 18-14084 Chapter 11 Petition filed April 11, 2018 represented by: Giovanni Orantes, Esq. ORANTES LAW FIRM PC E-mail: go@gobklaw.com In re HN3, LLC Bankr. S.D. Fla. Case No. 18-14260 Chapter 11 Petition filed April 11, 2018 See http://bankrupt.com/misc/flsb18-14260.pdf represented by: Joel M. Aresty, Esq. JOEL M. ARESTY P.A. E-mail: aresty@mac.com In re Gary Matthews Bankr. C.D. Ill. Case No. 18-80517 Chapter 11 Petition filed April 11, 2018 represented by: Scott R. Clar, Esq. CRANE, SIMON, CLAR & DAN E-mail: sclar@craneheyman.com In re Monte J. Brannan Bankr. C.D. Ill. Case No. 18-80517 Chapter 11 Petition filed April 11, 2018 represented by: Scott R. Clar, Esq. CRANE, SIMON, CLAR & DAN E-mail: sclar@craneheyman.com In re Black Diamond Realty Of NY Inc Bankr. E.D.N.Y. Case No. 18-42001 Chapter 11 Petition filed April 11, 2018 See http://bankrupt.com/misc/nyeb18-42001.pdf Filed Pro Se In re Veronica Faye Kirzhner Bankr. E.D.N.Y. Case No. 18-42002 Chapter 11 Petition filed April 11, 2018 See http://bankrupt.com/misc/nyeb18-42002.pdf represented by: Joel M. Shafferman, Esq. SHAFFERMAN & FELDMAN LLP E-mail: joel@shafeldlaw.com In re Albany Eye Physicians & Surgeons P.C. d/b/a Stasior & Stasior Eye Care Bankr. N.D.N.Y. Case No. 18-10626 Chapter 11 Petition filed April 11, 2018 See http://bankrupt.com/misc/nynb18-10626.pdf represented by: Francis J. Brennan, Esq. NOLAN & HELLER, LLP E-mail: fbrennan@nolanandheller.com In re Carlos Quito Bankr. S.D.N.Y. Case No. 18-22523 Chapter 11 Petition filed April 11, 2018 Filed Pro Se In re The Greek Bros., Inc. Bankr. S.D. Tex. Case No. 18-60017 Chapter 11 Petition filed April 11, 2018 See http://bankrupt.com/misc/txsb18-60017.pdf represented by: Margaret Maxwell McClure, Esq. LAW OFFICE OF MARGARET M. MCCLURE E-mail: margaret@mmmcclurelaw.com In re Garden Oaks Maintenance Organization, Inc. Bankr. S.D. Tex. Case No. 18-60018 Chapter 11 Petition filed April 11, 2018 See http://bankrupt.com/misc/txsb18-60018.pdf represented by: Johnie J Patterson, Esq. WALKER & PATTERSON, P.C. E-mail: jjp@walkerandpatterson.com In re Abdul Qadir Khan Bankr. E.D. Va. Case No. 18-11270 Chapter 11 Petition filed April 11, 2018 Filed Pro Se In re AZ RES INVESTMENTS LLC Bankr. D. Ariz. Case No. 18-03839 Chapter 11 Petition filed April 12, 2018 Filed Pro Se In re LG Spyglass, LLC Bankr. N.D. Cal. Case No. 18-50815 Chapter 11 Petition filed April 12, 2018 See http://bankrupt.com/misc/canb18-50815.pdf represented by: Charles B. Greene, Esq. LAW OFFICES OF CHARLES B. GREENE E-mail: cbgattyecf@aol.com In re Michael Patrick Smith Bankr. S.D. Fla. Case No. 18-14312 Chapter 11 Petition filed April 12, 2018 represented by: Aaron A. Wernick, Esq. E-mail: awernick@furrcohen.com In re C&D Rail Services, Inc. Bankr. N.D. Ill. Case No. 18-10691 Chapter 11 Petition filed April 12, 2018 See http://bankrupt.com/misc/ilnb18-10691.pdf represented by: Nicholas C. Kefalos, Esq. VERNOR MORAN LLC E-mail: nkefalos@vernormoran.com In re NA 1943 Eastern Parkway LLC Bankr. E.D.N.Y. Case No. 18-42043 Chapter 11 Petition filed April 12, 2018 See http://bankrupt.com/misc/nyeb18-42043.pdf represented by: Guljit Bains, Esq. ALI AND BAINS PC E-mail: gbains@alibainsfirm.com In re Jose M. Melero Munoz and Maria V. Bonnin Orozco Bankr. D.P.R. Case No. 18-01951 Chapter 11 Petition filed April 12, 2018 represented by: Hector Juan Figueroa Vincenty, Esq. E-mail: quiebras@elbufetedelpueblo.com In re Burgess Services, LLC Bankr. M.D. Tenn. Case No. 18-02486 Chapter 11 Petition filed April 12, 2018 See http://bankrupt.com/misc/tnmb18-02486.pdf represented by: Steven L. Lefkovitz, Esq. LAW OFFICES LEFKOVITZ & LEFKOVITZ E-mail: slefkovitz@lefkovitz.com ********* 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. 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