/raid1/www/Hosts/bankrupt/TCR_Public/180720.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, July 20, 2018, Vol. 22, No. 200
Headlines
201 LUIZ MARIN: $3M Sale of Jersey City Condo Unit to Winfield OK'd
443 HANCOCK: Voluntary Chapter 11 Case Summary
AARON K. JONAN: Aug. 7 Plan Confirmation Hearing
ADAMIS PHARMACEUTICALS: Registers 1.7M Shares Under 2009 Plan
AMERICAN RANCH: Primary Attorney's Accident Delays Plan Filing
AMERIGAS PARTNER: Moody's Alters Outlook to Stable & Affirms CFR
ANASTASIA INTERMEDIATE: Fitch Assigns 'BB-' IDR, Outlook Stable
ANCHOR REEF: Amends Plan to Add Condition on Effectivity
ANZHEY BARANTSEVICH: $1.8M Sale of Encino Property Approved
ASTHMA AND ALLERGY: Aug. 7 Plan Confirmation Hearing
ATD CAPITOL: Capitol Supply Needs To Continue Settlement Talks
AVISON YOUNG: S&P Cuts Issuer Credit Rating to B-, Outlook Stable
AVOLON HOLDINGS: Fitch Affirms 'BB' LT IDR, Outlook Stable
BARCELONA APARTMENTS: Allowed to Use Fannie Mae's Cash Collateral
BARCELONA APARTMENTS: Can Assume Management Agreement with SunRidge
BLINK CHARGING: Fails to Comply with "Independent Director" Rule
BOSSLER ROOFING: Delays Plan Filing to Accommodate All Claims
BREDA: Sale Efforts Delay Filing of Plan of Reorganization
BRIDAN 770: Has Until Sept. 24 to Exclusively File Plan
CAPITAL TEAS: Needs Additional Time to Exclusively File Plan
CAPITOL SUPPLY: Wants Settlement Talks With Bank of America
CARTER COUNTY, KY: S&P Lowers 2012 GO Bonds Rating to 'BB+'
CELADON GROUP: Closes Amendment to Credit Agreement
CELLECTAR BIOSCIENCES: Reports Positive Phase 2 Data for CLR 131
CHICAGO, IL: Moody's Affirms Ba2 Rating on 2010A COPs
COLLEGE PARK: Unsecureds to Get 20% Distribution in Latest Plan
CONCORDIA INTERNATIONAL: Files SEC Form 25-NSE
CONCORDIA INTERNATIONAL: Stock Delisted From Nasdaq
CONDUENT BUSINESS: Moody's Affirms Ba3 CFR, Outlook Stable
CORNBREAD VENTURES: Aug. 9 Plan Confirmation Hearing Set
COSMEDX SCIENCE: Case Summary & 20 Largest Unsecured Creditors
CREDITCORP: S&P Raises ICR to 'CCC+' Then Withdraws Rating
D-M-B CORP: $1.3M Sale of Camden Property to 1828 Realty Approved
DANIEL BENYAMIN: $590K Sale of New York Condo Unit 5E Approved
DITECH HOLDING: S&P Affirms 'CCC+' ICR, Outlook Stable
DORIAN LPG: Confirms Receipt of Director Nominations from BW LPG
EAGLE REBAR: $6K Sale of 40-Foot Trailer to HD Supply Approved
ELEMENTS BEHAVIORAL: U.S. Trustee to Name D. Crapo as PCO
EXPERT CAR: Aug. 23 Evidentiary Hearing on Disclosure Statement
FAGERDALA USA - LOMPOC: Kleinberg Kaplan Comments on Court Ruling
FC GLOBAL: Appoints Michael Stewart as CEO and CFO
FC GLOBAL: Files SEC Form 25-NSE Delisting Notification
FIBRANT LLC: Sale of Surplus Assets to PCS Nitrogen Approved
FRANKLIN SQUARE: Moody's Assigns Ba1 CFR, Outlook Stable
FRANKLIN SQUARE: S&P Gives BB Issuer Credit Rating, Outlook Stable
GI CHILL: Moody's Assigns B3 CFR & Rates First Lien Term Loan B2
GI CHILL: S&P Assigns 'B-' Corporate Credit Rating, Outlook Stable
GLOBALLOGIC HOLDINGS: Moody's Assigns B2 CFR, Outlook Stable
GLOBALLOGIC HOLDINGS: S&P Assigns 'B+' CCR, Outlook Stable
HAMKOR ENTERPRISES: Unsecureds to be Paid Every 6 Mos. for 3 Years
HARLEM MARKET: Issues With Commercial Lease Delays Plan Filing
HD SUPPLY: Moody's Hikes CFR & Sec. Term Loan Rating to Ba2
HGIM HOLDINGS: Davis Polk Advises Administrative Agent, Lenders
HOG SNAPPERS: Delays Plan Filing, Wants North Palm Beach Asset Sale
HORIZON GLOBAL: S&P Cuts 1st Lien Debt Rating to 'CCC' Amid Add-on
HOVENSA LLC: Judge Smock May Consider Evidence on Option 1 Claims
IBEX LLC: To Pay Unsecured Creditors from Net Profit Funds
INTREPID AVIATION: Fitch Affirms 'BB-' LT IDR, Outlook Stable
LAKE BRANCH: Case Summary & 5 Unsecured Creditors
LEGAL COVERAGE: Trustee's $3.2M Sale of Philadelphia Penthouse OK'd
LEGAL COVERAGE: Trustee's $965K Sale of Philadelphia Property OK'd
LENEXA HOTEL: Court Tosses HHF Bid for Stay Pending Appeal
LH ANESTHESIA: Must Show Cause Regarding Ombudsman Appointment
LUKE'S LOCKER: Has Until Sept. 21 to File Plan of Reorganization
MAURICE SPORTING: Has Until Sept. 17 to Exclusively File Plan
MEDPLAST HOLDINGS: Moody's Assigns B2 CFR, Outlook Stable
MESOBLAST LIMITED: Signs Strategic Alliance with China's Tasly
MORGAN STANLEY 2018-H3: Fitch Rates Class G-RR Certs 'B-sf'
NATIONAL EVENTS: Has Until Oct. 22 to Exclusively File Plan
NCI BUILDING: Moody's Puts Ba3 CFR on Review for Downgrade
NCI BUILDING: S&P Puts 'BB' Corp Credit Rating on Watch Negative
NCW PROPERTIES: Case Summary & 13 Unsecured Creditors
NORTHERN OIL: Appoints Deloitte & Touche as New Auditors
ONCOBIOLOGICS INC: Completes Exchange of Series A Preferred Stock
PACIFIC DRILLING: Seeks Extension of Plan Filing, Mediation Period
PELICAN REAL ESTATE: July 30 Auction of Consumer Accounts Pool
PF ROOSEVELT: S&P Withdraws 'BB+' Rating on 2014A Rev. Bonds
PICOTEO DE TAPAS: Case Summary & 10 Unsecured Creditors
PRAGAT PURSHOTTAM: Case Summary & 5 Unsecured Creditors
PRECIPIO INC: Expects 213% YoY Revenue Growth in Q2 2018
PUERTO RICO: Utility Directors Resign as Gov. Demands CEO Pay Cut
QUANTUM WELLNESS: Modifies Treatment of Opus, AmEx Claims
QUECHAN INDIAN: Fitch Affirms 'B' Issuer Default Rating
RED RIVER: Aug. 7 Plan Confirmation Hearing
RISE ENTERPRISES: Pending Talks With Creditors Delay Plan Filing
SALYERSVILLE MEDICAL: Aug. 7 Plan Confirmation Hearing
SAM MEYERS: $1.2M Sale of Louisville Property to Hollenbach Okayed
SCOTTISH HOLDINGS: Aug. 2 Plan Confirmation Hearing
SHARING ECONOMY: Will Sell $50 Million Worth of Securities
SPEED VEGAS: Plan Funder to Buy Assets, SLV for $12MM
SS BODY ARMOR: Dispute with CL&M Withdrawn from Mediation
STAR MOUNTAIN: Aug. 1 Disclosure Statement Hearing
STARS GROUP: Fitch Hikes Rating on Sr. Sec. Credit Facility to 'BB+
SUBURBAN PROPANE: Moody's Alters Outlook to Stable & Affirms CFR
SUPERIOR PLUS: DBRS Hikes Rating on Senior Unsecured Debt to BB
T.C. RENFROW: Can Get New Credit or Sell Property to Perform Plan
THINK TRADING: Needs More Time to File Plan of Reorganization
TORRADO CONSTRUCTION: Case Summary & 20 Top Unsecured Creditors
TRIBUNE CO: Judge Pushes Settlement Talks in LBO Court Fight
TRIUMPH GROUP: Moody's Cuts CFR to B3 & Alters Outlook to Negative
UGHS SENIOR: Bankr. Court Disallows Donald Sapaugh's Claims
UGHS SENIOR: Court Allows E. Laborde $160K Unsecured Claim
US SECURITY ASSOCIATES: S&P Puts Ratings on Watch Negative
VERRA MOBILITY: Moody's Affirms B2 CFR & Cuts Term Loan to B2
WACHUSETT VENTURES: Has Until July 25 to Exclusively File Plan
WIT'S END RANCH: $3.7M Sale of Denver Property to IH Approved
WOLVERINE WORLD: Moody's Hikes CFR to Ba1 & Unsec. Notes to Ba2
WOODBRIDGE GROUP: Bankr. Court Corrects Errors in June 20 Opinion
[*] 2018 DI Conference Discount Tickets Available for Early Birds
[*] Fitch Group Completes Acquisition of Fulcrum Financial Data
[*] K&L Gates Hires Hospitality, Restructuring and Insolvency Team
[^] BOOK REVIEW: Risk, Uncertainty and Profit
*********
201 LUIZ MARIN: $3M Sale of Jersey City Condo Unit to Winfield OK'd
-------------------------------------------------------------------
Judge John K. Sherwood of the U.S. Bankruptcy Court for the
Northern District of New Jersey authorized 201 Luiz Marin Realty,
LLC's sale of condominium unit #R2A of The Gulls Cove Condominiums,
located at 201 Marin Blvd., Jersey City, County of Hudson, New
Jersey, also known as Lot 8, Block 15906, Qualifier C1921, as shown
on the current tax map of Jersey City, to Winfield Properties, LLC,
for $3 million.
A hearing on the Motion was held on April 3, 2018.
The sale is free and clear of all liens, claims, interests and
encumbrances.
The customary closing adjustments payable by the Debtor for water,
sewer charges, other municipal charges, and condominium common
charges or assessments attributable to the Property will be
satisfied from the proceeds of the sale at closing.
Pursuant to D.N.J. LBR 6004-5, the Debtor will pay the retained
realtors from the sale proceeds without a separate application for
compensation. The retained realtors are Gabriel Silverstein and
Alessandro Conte who jointly assisted the Debtor with marketing the
property, introduced prospective buyers, negotiated with
prospective buyers and the proposed buyer, and assisted in
effectuating the closing of sale. Silverstein and Conte will share
$150,000 (5% of sales price) as total compensation for their
services rendered to the Debtor which will be paid at closing.
The Debtor and its counsel will reserve their rights pursuant to
Section 506(c) of the Bankruptcy Code to seek compensation for
preserving and dispossessing the Property. Any request for
compensation pursuant to Section 506(c) of the Bankruptcy Code will
be made by further motion to the Bankruptcy Court.
The property taxes owed to the municipality and the tax certificate
holder Gregory Judge or his assignee; the secured claims held by
Bank Of New Jersey; water, sewer, other municipal charges owed to
the municipality; and condominium common charges or assessments
attributable to the Property, will be paid in full at closing.
The Debtor will be required to make further application to the
Bankruptcy Court for release of any funds held in escrow following
the closing, including attorney fees.
The provisions of the Order will be self-executing.
The proceeds from the sale of the Property, which are property of
this bankruptcy estate, will be held in the Debtor's Attorney's
Trust Account pending confirmation of a chapter 11 reorganization
plan or further order of the Court.
A true copy of the Order will be served on all parties who received
notice of the Motion, within seven days from its entry.
About 201 Luiz Marin Realty
201 Luiz Marin Realty, LLC is a Single Asset Real Estate enterprise
owning a condominium unit situated at 201 Marin Boulevard in the
city of Jersey City, County of Hudson, and State of New Jersey.
Based in Jersey City, New Jersey, 201 Luiz Marin Realty, LLC,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
D.N.J. Case No. 17-31443) on October 23, 2017. Stephen Anatro, its
managing member, signed the petition.
The Debtor is a single asset real estate (as defined in 11 U.S.C.
Section 101(51B)). At the time of the filing, the Debtor said its
assets are valued at "zero" and its liabilities total $3.37
million.
Judge Stacey L. Meisel presides over the case.
The Debtor is represented by the Law Offices of Jerome M. Douglas,
LLC.
443 HANCOCK: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: 443 Hancock Street LLC
1274 49th Street
Brooklyn, NY 11219
Business Description: 443 Hancock Street LLC filed as a Single
Asset Real Estate (as defined in 11
U.S.C. Section 101(51B)).
Chapter 11 Petition Date: July 18, 2018
Case No.: 18-44138
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Hon. Carla E. Craig
Debtor's Counsel: Solomon Rosengarten, Esq.
SOLOMON ROSENGARTEN
1704 Avenue M
Brooklyn, NY 11230-5423
Tel: (718) 627-4460
Fax: (718) 627-4456
Email: VOKMA@aol.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Chitim Wurzberger, member.
The Debtor failed to incorporate in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/nyeb18-44138.pdf
AARON K. JONAN: Aug. 7 Plan Confirmation Hearing
------------------------------------------------
Judge Tracey N. Wise of the U.S. Bankruptcy Court for the Eastern
District of Kentucky has conditionally approved the disclosure
statement explaining the first amended small business Chapter 11
plan filed by the Chapter 11 trustee of Aaron K. Jonan Memorial
Clinic, Inc., and has scheduled August 7, 2018, at 9:30 a.m. (ET),
for the hearing on confirmation. July 31, 2018 at 5:00 PM (ET), is
fixed as the deadline for filing written acceptances or rejections
to the Plan.
About Red River Healthcare
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
Asthma and Allergy Center, LLC, and Pediatric Associates of
Pikeville, LLC each filed chapter 11 petitions (Bankr. E.D. Ky.
Case No. 15-51438, 15-51439, 15-70469, and 15-70470) on July 21,
2015. Salyersville Medical Center, LLC filed a chapter 11 petition
(Bankr. E.D. Ky. Case No. 15-70818) on December 21, 2015. The
petitions were signed by Djien H. So, managing member. The Debtors
are represented by Jamie L. Harris, Esq., at Delcotto Law Group
PLLC.
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
and Pediatric Associates of Pikeville, LLC each estimated assets
and liabilities at $100,001 to $500,000. Asthma and Allergy Center,
LLC and Salyersville Medical Center, LLC each estimated assets at
$100,001 to $500,000 and liabilities at $500,001 to $1 million.
Adam M. Back, Esq., was appointed Chapter 11 Trustee, and is
represented by Jessica L. Middendorf, Esq., at Stoll Keenon Ogden
PLLC, in Lexington, Kentucky.
ADAMIS PHARMACEUTICALS: Registers 1.7M Shares Under 2009 Plan
-------------------------------------------------------------
Adamis Pharmaceuticals Corporation has filed with the Securities
and Exchange Commission a Form S-8 registration statement to
register 1,669,471 additional shares of common stock under the 2009
Equity Incentive Plan. The Plan provides that an additional number
of shares will automatically be added annually to the 411,765
shares initially authorized for issuance under the Plan on January
1, from 2010 until 2019. The number of shares added each year will
be equal to (i) five percent of the total number of shares of
Common Stock outstanding on December 31st of the preceding calendar
year, or (ii) a lesser number of shares of Common Stock determined
by the Board of Directors before the start of a calendar year for
which an increase applies. Accordingly, the number of shares of
Common Stock available for issuance under the Plan was increased by
1,669,471 shares effective Jan. 1, 2018. This Registration
Statement registers 1,669,471 additional shares of Common Stock
available for issuance under the Plan as a result of that increase
and the Evergreen Provisions. A full-text copy of the prospectus
is available for free at https://is.gd/WPV0VC
About Adamis
San Diego, Calif.-based Adamis Pharmaceuticals Corporation
(OTCQB:ADMP) -- http://www.adamispharmaceuticals.com/--
is a specialty biopharmaceutical company focused on developing and
commercializing products in the therapeutic areas of respiratory
disease and allergy. The company's first product, Symjepi
(epinephrine) Injection 0.3mg, was approved for use in the
emergency treatment of acute allergic reactions, including
anaphylaxis. Adamis' product pipeline includes HFA metered dose
inhaler and dry powder inhaler products for the treatment of
bronchospasm and asthma.
Adamis incurred a net loss of $25.53 million in 2017 compared to a
net loss of $19.43 million in 2016. As of March 31, 2018, Adamis
had $43.78 million in total assets, $10.33 million in total
liabilities and $33.44 million in total stockholders' equity.
The report from the Company's independent accounting firm Mayer
Hoffman McCann P.C., in San Diego, California, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the Company has incurred
recurring losses from operations, and is dependent on additional
financing to fund operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
AMERICAN RANCH: Primary Attorney's Accident Delays Plan Filing
--------------------------------------------------------------
American Ranch and Seafood Markets, Inc., asks the U.S. Bankruptcy
Court for the Central District of California to extend the
exclusivity period during which only the Debtor can file a plan of
reorganization and solicit acceptance of the plan through and
including Aug. 27, 2018, and Nov. 6, 2018.
Currently, the Exclusivity Periods for the filing of the plan and
the solicitation of acceptance of the plan expires on July 10,
2018, and Sept. 7, 2018, respectively.
This is not a large or complex case. The Debtor's principals,
which consist of two people, have been both operating the Debtor's
business and assisting with the reorganization since this
Bankruptcy Case was filed. Since the Debtor's administrative staff
is modest, it took a lot of time
and effort to comply with the initial filing requirements.
Further, the U.S. Trustee filed a motion to dismiss, and the Debtor
had to expend time and effort responding to that motion to dismiss.
The Debtor has also amended some of its schedules.
Inasmuch as the Debtor administrative staff is modest and its
principals run the day to day operations of the business as well as
work on the reorganization process, 120 days is not sufficient for
the Debtor to propose a plan and prepare adequate information for
the disclosure statement. The Debtor submits that the requested
extension should be sufficient to propose a plan and prepare
adequate information.
The Debtor assures the Court that it has acted in good faith. The
Debtor has complied with all the initial filing requirements and is
working on a plan and disclosure statement. The Debtor is paying
all bills as they come due. The Debtor is negotiating with
creditors in an effort to propose a consensual plan.
Sandford L. Frey, the primary attorney responsible for this
matter, sustained a rather serious head injury as a result of a
fall on June 3, 2018, which resulted in Mr. Frey's hospitalization.
Mr. Frey has been only recently cleared by his doctor to return to
work full time and so requires the additional time to fully recover
and draft the Plan and Disclosure Statement.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/cacb18-10175-103.pdf
About American Ranch and Seafood
American Ranch and Seafood Markets, Inc. --
https://americanranchmarket.com/ -- operates a specialty store
offering Filipino foods and groceries with locations in Eaglerock,
Artesia and East Hollywood, California. The company provides a
selection of fresh seafood, fresh produce (fruits & vegetables),
meat and an assortment of popular brand name groceries. It also
accepts catering services for special events. American Ranch is
equally owned by Gene S. Chua and Virgil Sy.
American Ranch sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. C.D. Cal. Case No. 18-10175) on Jan. 5, 2018. In the
petition signed by Gene S. Chua, president and CEO, the Debtor
estimated assets of less than $500,000 and liabilities of $1
million to $10 million. Judge Julia W. Brand presides over the
case. Sandford L. Frey, Esq., at Leech, Tishman, Fuscaldo & Lampl,
Inc., serves as the Debtor's bankruptcy counsel.
AMERIGAS PARTNER: Moody's Alters Outlook to Stable & Affirms CFR
----------------------------------------------------------------
Moody's Investors Service changed AmeriGas Partners, L.P.'s outlook
to stable from negative and concurrently affirmed AmeriGas's Ba2
Corporate Family Rating, Ba2-PD Probability of Default Rating, Ba3
senior unsecured notes, and SGL-3 Speculative Grade Liquidity
Rating.
"The stable outlook reflects its view that AmeriGas will maintain
its debt/EBITDA ratio at or below 4.5x through fiscal 2019 and look
for ways to further reduce leverage to comfortably accommodate
weather related variability in earnings," said Sajjad Alam, Moody's
Senior Analyst. "While leverage remains elevated at 4.6x, Moody's
expects the company to keep leverage around 4x under normal winter
conditions with occasional increases towards 4.5x in the event of a
warm winter."
Outlook Actions:
Issuer: AmeriGas Partners, L.P.
Outlook, Changed To Stable From Negative
Affirmations:
Issuer: AmeriGas Partners, L.P.
Probability of Default Rating, Affirmed Ba2-PD
Speculative Grade Liquidity Rating, Affirmed SGL-3
Corporate Family Rating, Affirmed Ba2
Senior Unsecured Notes, Affirmed Ba3 (LGD4)
Senior Unsecured Shelf, Affirmed (P)Ba3
RATINGS RATIONALE
AmeriGas's Ba2 CFR is supported by its large scale and leading
market position in the US propane distribution industry,
diversified geographic footprint that tempers earning volatility,
and a long history of successfully integrating acquisitions that
have offset natural volume declines. The CFR also considers
AmeriGas's high financial leverage that has increased over time,
the seasonal and volatile nature of propane sales, the challenging
dynamics of the propane distribution industry, which is fragmented,
highly competitive and secularly declining, and the Master Limited
Partnership (MLP) legal structure, which entails high cash payouts
to unitholders. The company's leverage increased above its
historical average levels in recent years due to two consecutive
warmer than normal winters, but then improved in fiscal 2018
following more normal winter temperatures. Given the company's MLP
business model and the associated high distribution burden,
recurring warm winters could force the company to partially debt
fund distributions pushing its leverage temporarily above the
acceptable range for the Ba2 rating level. However, the company has
a $225 million equity commitment agreement with its general partner
(UGI Corporation) through July 1, 2019 to help reduce leverage if
necessary.
AmeriGas should have adequate liquidity through 2019, which is
reflected in the SGL-3 rating. AmeriGas had $5 million of cash and
$378 million in available borrowing capacity under its $600 million
senior unsecured revolving credit facility as of March 31, 2018,
after accounting for $67 million of outstanding letters of credit.
The revolver matures on December 15, 2022 and revolver usage is
expected to follow historical trends, with seasonal fluctuations
resulting in peak balances during the heating season and minimum
balances in summer months. AmeriGas should be able to comply with
its credit agreement financial covenants through 2019. AmeriGas
does not have any bond maturities until 2024 following the
refinancing of the 7% notes in 2017.
The senior unsecured notes are rated Ba3, one notch below
AmeriGas's Ba2 CFR under Moody's Loss Given Default methodology
given its structurally subordinated claim behind the company's
revolving credit facility and trade claims that reside at its
primary operating subsidiary AmeriGas Propane, L.P.
The stable outlook reflects Moody's expectation that leverage will
further moderate through the end of the 2018 fiscal year. The
rating could be downgraded if debt/EBITDA remains above 4.5x
normalized for seasonal working capital borrowings or if
distribution coverage dips below 1x on a full fiscal year basis.
Although a positive action is unlikely in the near future, Moody's
could consider an upgrade if debt/EBITDA is sustained at or below
3.5x with distribution coverage above 1.1x.
AmeriGas Partners, L.P. is a publicly traded master limited
partnership that is the largest retail propane distributor in the
United States based on volumes of propane distributed annually.
ANASTASIA INTERMEDIATE: Fitch Assigns 'BB-' IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has assigned a first-time 'BB-' Long-Term Issuer
Default Rating (IDR) to Anastasia Intermediate Holdings, LLC
(Anastasia Beverly Hills Inc., or ABH) and Anastasia Parent, LLC.
The Rating Outlook is Stable.
ABH's ratings reflect the company's strong track record of growth
and customer connections, good financial profile including
above-average EBITDA margin and positive FCF, and leverage of
mid-3x following the proposed debt-financed dividend, which Fitch
projects would trend towards the high 2x over the next two to three
years. The rating also considers the company's narrow product and
brand profile, recent explosive growth that could reverse course,
and risk that continued beauty industry market share shifts could
weaken ABH's projected growth through the risk of new entrants or
existing players regaining share.
ABH is a prestige cosmetics brand, primarily focused in the U.S.,
with particular strength in brows, eye shadows, and lipsticks. The
company has benefitted from growth in specialty beauty retail and
effective use of the burgeoning social media platform to expand
brand awareness and affinity. Revenue and EBITDA growth has been
substantial in recent years with $180 million of EBITDA in 2017.
Fitch expects the company can sustain 10% revenue growth annually
over the next few years through new product introductions and
increased distribution domestically and internationally. Risk to
the rating include sales deceleration to the low to mid-single
digit level, due to unsuccessful execution of the company's
strategies around product and market introduction, emergence of new
competing brands, the stemming of declines by established companies
with large market shares or the reduction in distribution from a
key customer.
Following a history of limited debt, the company is proposing a
$650 million term loan. Proceeds, in addition to proceeds from a
recent minority equity investment by TPG Capital (reportedly for
around $700 million), will be used to pay the founding family a
dividend.
KEY RATING DRIVERS
Impressive Growth Trajectory
ABH has built an enviable track record of growth through expanding
points of distribution, product introductions, and savvy use of
emerging marketing vehicles. From her industry origins as an
eyebrow specialist, founder Anastasia Soare saw a product gap in
the cosmetics industry and introduced her first brow-focused line
in 2000. The company built a market presence through celebrity
endorsements, magazine product placements, and an aggressive focus
on customer connections and product quality and innovation. Over
time, the company expanded its assortment to include eye shadows,
lipsticks, brushes and bronzers amongst other cosmetics products.
Supporting the business model are positive characteristics of the
cosmetics category, which has reliably grown in the 3%-5% range
(closer to high-single digits for prestige cosmetics), shown
resistance to recessionary pullbacks, and exhibits limited price
promotion and a strong margin profile for brand leaders.
Underscoring ABH's unique go-to market philosophy has been a
tutorial approach, offering customers advice (through videos posted
online) on optimal product usage and application. This philosophy
led the company's decision to be an early adopter of the Instagram
platform, where ABH can share videos, interact with customers and
expand its reach. ABH's social platform has approximately 18
million Instagram followers and relationships with key social media
influencers who use ABH products in their photos and videos. ABH's
social platform has been a key source of establishing and
maintaining close customer connections without an extensive market
budget; in fact, ABH spends significantly less than its peers on
marketing as a percent of sales compared to sizable peers like
Revlon Inc., The Estee Lauder Companies Inc. and Coty Inc., which
spend between 20%-30% of revenue on marketing.
The company has expanded its retail reach with partners such as
growing specialty players Sephora (owned by LVMH Moet Hennessy
Louis Vuitton) and Ulta Beauty, and department stores Nordstrom,
Inc. (BBB+/Stable) and Macy's, Inc. (BBB/Negative). ABH has become
a sought-after brand for retailers and is a top-performer across
key retail accounts. The company's brands are sold in around 2,600
stores in North America and over 1,000 internationally. Products
are sold online on its own website, Amazon.com, Inc. (A+/Stable)
and the e-commerce channel of many of its retail partners.
ABH's successful expansion is evidenced by its topline trajectory
with an approximately 64% revenue CAGR from 2014 to 2017. While
growth has slowed somewhat in recent years (from over 100% in 2014
and 2015 to 17% in 2017) due in part to growing scale, Fitch
believes ABH should be able to track somewhat above the industry's
expected 3%-5% growth rate over the next few years, expanding
around 10% annually through 2020.
Strong Financial Profile
ABH's strong financial profile extends beyond its impressive
revenue growth. While the cosmetics category benefits from strong
gross margins, ABH's EBITDA margin well exceeds peers, which are in
the 20%-30% range. Fitch believes the company's outperformance to
peers is largely due to minimal marketing expense but may also
relate to less corporate infrastructure, including backoffice
functions like merchandising and inventory planning. ABH plans to
increase growth investments in new products, geographies, and owned
e-commerce, and Fitch therefore expects EBITDA margins to moderate
somewhat but continue to trend well above the industry average over
the next two to three years.
ABH generates ample cash flow, largely due to good EBITDA
generation with limited leakage such as no interest expense
historically. The company also outsources much of its supply chain
and with limited backoffice infrastructure has limited capital
expenditures. As such, cash flow after estimated owner
distributions for cash taxes but before estimated discretionary
owner distributions, has trended between 10% and 20% of revenue.
Despite the addition of interest expense following the proposed
debt issuance, Fitch expects FCF to improve on EBITDA growth and
neutral working capital. While FCF has historically been used for
owner distributions, ABH could direct some cash flow toward debt
reduction beyond what would be mandated by its excess cash flow
sweep under its new term loan.
Growth Avenues Present Risk and Opportunity
Given its broad exposure in the U.S. retail channel, ABH has
identified international expansion and e-commerce as key growth
opportunities. ABH also believes it can grow sales through new
product and category introductions over time. Fitch projects ABH
can grow its revenue base around 12% in 2018 and around 10%
thereafter.
The company believes international expansion to be an opportunity
given its product assortment is conducive for customers with a
diverse range of skin/hair tones, and based on its existing
customer reach through social media. The company has recently
entered several new markets with strong initial customer
acceptance.
To grow market share internationally, ABH would need to
successfully challenge large incumbent brands as it has in the
U.S., while in some markets ABH would need to change customer
habits around makeup regimens to promote product usage. ABH will
also need to select partners, such as Sephora (which has around
1,500 stores internationally), that can appropriately showcase the
brand and support ABH's social media efforts to educate consumers
about its products. Fitch believes ABH can leverage its social
media platform to quickly ramp in new geographies with the right
retail partner. As a result, Fitch's base case assumes a 25% CAGR
in international revenue.
ABH's ecommerce penetration from its own site is lower than
Euromonitor's estimate of 12% ecommerce penetration of U.S. color
cosmetics. Online penetration of the industry is somewhat below the
approximate 20% retail average (excluding low-online categories
like auto and grocery) due to the sensory and try-on nature of the
category. Fitch estimates a significant portion of online cosmetics
sales follow an in-person experience of the brand/product.
Given ABH's lower penetration and strong social media following,
the company believes it has an opportunity to drive sales on its
owned site. The company plans to ramp efforts in digital marketing,
including search engine optimization, display adds, and affiliates.
ABH will also embark upon a site redesign, adding features and
customer services to its offering. The company also plans to use
its website as an avenue through which to introduce new products
and offer an assortment not available at third party retailers.
While ABH's owned ecommerce penetration is below the industry
average, Fitch estimates ABH's overall online penetration is much
higher, including sales generated on websites of key customers like
Sephora and Ulta and aforementioned international sites. Given its
overall strong online penetration, ABH's ability to drive
incremental sales from its owned ecommerce website could be limited
or may cannibalize sales from other websites and channels. As such,
Fitch projects an e-commerce CAGR for ABH to be 8%, close to
Fitch's projection for growth in its North American wholesale
business. Increasing penetration of direct sales should be margin
accretive to ABH by eliminating margin leakage to retail partners.
The risk, however, is alienating retailer relationships, which
Fitch believes are key to ABH given its customer concentration with
key accounts, a sensory-focused category, and ABH's below-average
marketing spend.
Finally, ABH plans to continue expanding its product suite beyond
its original brow-focused assortment. Despite recent category
introductions in lip and face, Fitch believes ABH 's product
portfolio to be less diverse than industry leaders, given a third
of its sales continues to be in brow products. Consequently, ABH
could increase sales to existing customers through further
penetrating categories such as skin care, foundations and powders.
Fitch believes the company can continue to leverage its brand reach
with new products but will need to maintain brand and product
integrity as it expands. Further, while ABH was somewhat of a
pioneer in the brow category, entrenched competitors exist across
much of ABH's product opportunity set and could be harder to
penetrate as ABH would need to drive share away from existing
players.
Exposure to Dynamic Industry with Accelerating Share Shifts
The color cosmetics industry has fundamentally positive
characteristics, including recession resistance, high margins, and
historically limited irrational price competition. Recent years,
however, have seen the industry - and some of its most venerable
brands - disrupted by new marketing and retail channels. The
traditional model of marketing cosmetics through magazine and TV
ads, and selling through department store counters, has markedly
changed.
The introduction of social media, combined with declines in
magazine and network television consumption, has changed marketing
philosophies across the industry. Consumers are building brand
awareness and affinity, and product knowledge, through preferred
online sites and social influencers. ABH pioneered the use of
social media to offer product tutorials and directly interact with
customers on product options and optimal usage. The low cost of
social media relative to traditional advertising channels have
allowed smaller upstart brands to quickly build a presence and
customer following online. Celebrities such as Kylie Jenner (Kylie
Cosmetics) and Rihanna (Fenty Beauty) are using their social
platforms to introduce new lines and products.
Simultaneously, consumer shopping habits have altered cosmetics
purchasing trends. Declines in department store traffic have been a
partial cause in the rise of the specialty retail channel in
cosmetics, including Sephora and Ulta as prominent players. Unlike
department stores with limited brand-sponsored counters, the
specialty players offer far greater options and a brand-discovery
model to generate customer excitement and repeat visits. Prestige
brands traditionally sold at department store brands, many of which
were or have been resistant to growth in the specialty channel,
have seen share loss to upstart brands which are featured in and
promoted by these growing retailers.
Finally, broader trends around health and wellness have been felt
in cosmetics, with brands increasingly employing and advertising
natural and organic ingredients, chemical-free compounds, and earth
friendly packaging. Retailers like drug stores have shifted their
cosmetic portfolios to emphasize this trend, reallocating shelf
space and promotional focus.
All of these trends have led to market share shifts within the
beauty industry. New brands have seen rapid sales ramps through
social media exposure and shelf space wins at Ulta/Sephora/drug
retailers. Some established brands which rely on traditional retail
and marketing channels have been unable to shift their strategies
commensurate with these trends. Shifting market share has led to
M&A activity as larger companies seek to improve their portfolio's
growth potential. For example, in the last few years Estee Lauder
purchased upstart brands Becca and Too Faced, while Unilever
N.V./Unilever PLC (A+/Stable) bought Sundial and Dollar Shave Club,
Coty bought Younique Cosmetics and Edgewell Personal Care Company
bought the Jack Black brand.
Fitch expects the retail and marketing landscape will continue to
evolve and impact industry share. Smaller brands like ABH may
continue to benefit from increased importance of social media and
growth in the specialty cosmetics channel. Conversely, larger
brands have deployed capital and intensified efforts to stem market
share declines and could pose challenges for further market share
gains by younger brands, if strategies are successfully
implemented. Finally, consumer shopping and brand interaction
habits could sharply change again, disrupting current norms which
brands like ABH have enjoyed.
Reasonable Leverage Profile with Pathway to Debt Reduction
ABH has operated with essentially no debt since inception. The
company has agreed to sell a minority equity stake to TPG Capital
and is issuing $650 million in term loans; together these proceeds
will provide the company founders a cash dividend. Pro forma for
the debt issuance, adjusted leverage is 3.6x on 2017 EBITDA.
Fitch anticipates ABH's growth trajectory will continue, although
sales growth could moderate to around the 10% range from 53% and
17% in 2016 and 2017, respectively. Fitch expects EBITDA margins to
moderate as ABH invests in e-commerce and international growth.
EBITDA is projected to grow 5% to 8% annually from around $180
million in 2017 to around $220 million over the next 24 to 36
months. Fitch expects FCF (after cash tax distributions but before
any discretionary cash distributions) to trend around 50% higher
than estimated 2017 results on higher EBITDA and lower working
capital swings, mitigated somewhat by the addition of interest
expense.
The term loan has a 1% amortization and an ECF sweep with
step-downs at various leverage levels. Fitch assumes ABH would be
required to reduce its term loan by approximately $18 million to
$20 million annually in 2019/2020 assuming ECF sweep of 25%. Given
EBITDA growth and modest debt reduction, Fitch expects leverage to
decline from the mid-3x on a pro forma basis to the high-2.0x range
over the next three years.
DERIVATION SUMMARY
ABH's 'BB-'/Stable rating reflects the company's strong track
record of growth and customer connections, good financial profile
including above-average EBITDA margin and positive FCF, and
leverage of mid-3x following the proposed debt-financed owner
dividend which Fitch projects would trend towards the high 2x over
the next two to three years. The rating also considers the
company's narrow product and brand profile, recent explosive growth
that could reverse course, and risk that continued beauty industry
market share shifts could weaken ABH's projected growth through the
risk of new entrants or existing players re-gaining share.
Avon Products, Inc.'s 'B+' rating reflects its sizable scale as a
leading direct-selling beauty company with $5.7 billion revenue in
2017 and its well-recognized brand in the beauty industry. However,
its operating results have been on a declining trajectory in recent
years as the company faces challenges from its direct-selling model
and emerging market exposure. The Negative Outlook reflects the
company's declining EBITDA trend, due to its challenged business
model and exposure to weak markets such as Brazil and Russia.
L Brands' 'BB+' rating reflects the company's dominant position in
intimate apparel through its Victoria's Secret brand and a strong
position in personal care and home products through the Bath & Body
Works Brand. L Brands' good track record of growth and industry
leading margins are offset by an aggressive shareholder return
policy that has traditionally dictated leverage. The Negative
Outlook reflects Fitch's concern that negative store traffic trends
at Victoria's Secret could be indicative of brand challenges that
extend beyond recent strategic changes and that these challenges
may continue to persist, weakening EBITDA and elevating leverage
above 4x.
Levi Strauss & Co.'s 'BB' rating reflects its strong brand, market
share and operating initiatives, which should collectively drive
low- to mid-single digit annual EBITDA growth over the next 24-36
months. Fitch expects leverage to trend in the low to mid 3x range
(3.2x TTM basis), assuming flat debt levels. The ratings also
recognize the secular challenges in the mid-tier apparel industry,
mitigated somewhat by Levi's geographic diversity, minimal fashion
exposure, and presence across a wide spectrum of distribution
channels. The Positive Outlook reflects the combination of Levi's
improved topline results and completion of its multi-year Global
Productivity Initiative, which could result in Levi adopting a more
articulated financial policy and increase Fitch's confidence in
leverage sustaining near or below current levels.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
-- Fitch expects ABH revenue growth to be around 10% annually.
Fitch expects ABH to continue above-industry growth predicated on
new product introductions, expansion of the specialty beauty retail
channel, and new market entry internationally.
-- EBITDA, which was around $180 million in 2017, is expected to
grow 5% to 8% annually to around $220 million over the next 24 to
36 months. This assumes that ABH adds SG&A to support product and
new market launches as well as growth in its e-commerce channel.
-- Annual FCF, after owner distributions for tax payments, is
forecasted around 50% above recent estimated levels given continued
EBITDA growth, offset by interest expense on the addition of debt.
Fitch expects some term loan repayment related to required
amortization and the company's excess free cash flow sweep, but FCF
could also be used for discretionary owner distributions as it has
in the past.
-- Pro forma for the issuance of $650 million in debt, ABH's
adjusted leverage is approximately 3.6x but could decline to the
high-2x range over the next three years on EBITDA growth and some
debt reduction.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Given ABH's small size, single brand and product category
concentration, and risk that continued beauty industry market share
shifts could weaken ABH's projected growth through the risk of new
entrants or existing players re-gaining share, a positive rating
action is not expected at this time. However, Fitch would view the
following positively:
-- Achievement of approximately $400 million in EBITDA. M&A could
contribute to diversification of ABH's brand and geographic
portfolio.
-- Adjusted leverage sustained near 3.0x, contemplating potential
M&A to diversify ABH's business.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Sales deceleration to the low to mid single digit level, due
to unsuccessful execution of the company's strategies around
product and market introduction, emergence of new competing brands,
the stemming of declines by large market share-donating rivals or
the reduction in distribution from a key customer;
-- EBITDA remaining close to or below current levels on
weaker-than-expected topline results or aggressive SG&A
investments;
-- Adjusted leverage remaining in the mid-3.0x range due to
either stagnant EBITDA growth, debt-financed acquisition, or
debt-financed dividends to sponsors and ABH founders.
LIQUIDITY
Adequate Liquidity: Pro forma for the proposed capital structure,
ABH will have access to a $150 million revolving credit facility
maturing 2023, with no borrowings expected at close. At close, the
company's debt would consist of a $650 million Term Loan B due
2025. FCF is expected to continue to be positive annually following
owner distributions for cash taxes given the S-corp structure. A
portion of the FCF is expected to be used for debt reduction
related to required amortization and the company's ECF sweep, with
the remainder used towards further debt reduction or additional
owner distributions.
FULL LIST OF RATING ACTIONS
Fitch has assigned the following ratings:
Anastasia Intermediate Holdings, LLC
-- Long-Term IDR 'BB-'.
Anastasia Parent, LLC
-- Long-Term IDR 'BB-';
-- Senior secured revolving credit facility 'BB+'/'RR1';
-- Senior secured Term Loan B at 'BB+'/'RR1'.
The Rating Outlook is Stable.
ANCHOR REEF: Amends Plan to Add Condition on Effectivity
--------------------------------------------------------
Anchor Reef Club at Branford, LLC, filed its first amended
disclosure statement along with a proposed plan of reorganization
dated June 29, 2018.
The Plan constitutes a liquidating chapter 11 plan for the Debtor
and provides for distribution of the proceeds of the Debtor's
assets to creditors following a sale of the Debtor's real property
located at 60 Maple Street, Branford, Connecticut.
On May 30, 2001, the Debtor acquired the Property by means of a
purchase money mortgage in the original principal amount of
$3,200,000 from Nassi Funding, LLC. The members of Nassi Funding
are Albert Nassi and Daniel Kane. Thus, the members of Nassi
Funding are trustees or grantors of the trusts that are the owners
of Holdings, making Nassi Funding a potential insider of the
Debtor.
The latest filing also adds a condition precedent to Effective Date
of the plan. The condition states that the Plan will not become
effective and the Effective Date will not occur unless (i) all
Class 2 unsecured creditors affirmatively vote to accept the plan,
or (ii) the Class 1 creditor and all Class 3 creditors agree to
waive this condition precedent.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/ctb17-21080-140.pdf
About Anchor Reef Club at Branford
Anchor Reef Club at Branford, LLC, based in Westlake Village, CA,
filed a Chapter 11 petition (Bankr. D. Conn. Case No. 17-21080) on
July 19, 2017. The Hon. James J. Tancredi presides over the case.
Timothy D. Miltenberger, Esq., at Coan Lewendon Gulliver &
Miltenberger, LLC, serves as bankruptcy counsel.
In its petition, the Debtor estimated $1 million to $10 million in
assets and $10 million to $50 million in liabilities. The petition
was signed by Albert Nassi, manager of the member.
ANZHEY BARANTSEVICH: $1.8M Sale of Encino Property Approved
-----------------------------------------------------------
Judge Maureen A. Tighe of the U.S. Bankruptcy Court for the Central
District of California authorized Anzhey Barantsevich's sale of the
real property commonly known as 16577 Bosque Drive, Encino,
California, to David Ashkenazi and Marissa Levi for $1,750,000.
A hearing on the Motion was held on May 23, 2018 at 9:30 a.m.
Escrow Jencor located at 13501 Ventura Blvd., Sherman Oaks,
California is authorized to pay the real estate commissions of
Wish/Sotheby's.
The Escrow is authorized to pay (i) all outstanding real property
taxes, including delinquent charges and accrued interest; (ii) the
U.S BANK lien in full, pursuant to a written payoff demand
submitted to Escrow; (iii) the Gottfurch lien without post-petition
late charges; (iv) the judgment lien of judgment creditors Beau
Cameron and White Zuckerman Luna & Hunt LLP as assignee of judgment
creditor in an amount not to exceed $65,160; (v) all escrow/title
fees; (vi) the termite report and costs and retrofit costs; (vii) a
credit of $7,500 to the Buyers' for the Buyers' recurring and
non-recurring closing costs.
The Escrow is not authorized to pay all remaining net proceeds to
the Debtor until further order of the Court.
The Debtor has reviewed the payoff demand by U.S. Bank dated June
4, 2018, sent to escrow on June 6, 2018 and has had an opportunity
to review it. The Debtor has theretofore approved the terms and
amount of the Payoff Demand. Within 24 hours of closing, the
Debtor will instruct the Escrow to pay the undisputed lien in full
pursuant to the Payoff Demand terms.
The lien of U.S. Bank will attach to the proceeds to the sale with
the same force, effect, validity and priority that previously
existed against the sale assets.
Anzhey Barantsevich sought Chapter 11 protection (Bankr. C.D. Cal.
Case No. 16-12073) on July 18, 2016. The Debtor tapped Michael Jay
Berger, Esq., as counsel.
ASTHMA AND ALLERGY: Aug. 7 Plan Confirmation Hearing
----------------------------------------------------
Judge Tracey N. Wise of the U.S. Bankruptcy Court for the Eastern
District of Kentucky has conditionally approved the disclosure
statement explaining the first amended small business Chapter 11
plan filed by the Chapter 11 trustee of Asthma and Allergy Center,
LLC, and has scheduled August 7, 2018, at 9:30 a.m. (ET), for the
hearing on confirmation. July 31, 2018 at 5:00 PM (ET), is fixed
as the deadline for filing written acceptances or rejections to the
Plan.
About Asthma and Allergy Center
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
Asthma and Allergy Center, LLC, and Pediatric Associates of
Pikeville, LLC each filed chapter 11 petitions (Bankr. E.D. Ky.
Case No. 15-51438, 15-51439, 15-70469, and 15-70470) on July 21,
2015. Salyersville Medical Center, LLC filed a chapter 11 petition
(Bankr. E.D. Ky. Case No. 15-70818) on December 21, 2015. The
petitions were signed by Djien H. So, managing member. The Debtors
are represented by Jamie L. Harris, Esq., at Delcotto Law Group
PLLC.
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
and Pediatric Associates of Pikeville, LLC each estimated assets
and liabilities at $100,001 to $500,000. Asthma and Allergy Center,
LLC and Salyersville Medical Center, LLC each estimated assets at
$100,001 to $500,000 and liabilities at $500,001 to $1 million.
Adam M. Back, Esq., was appointed Chapter 11 Trustee, and is
represented by Jessica L. Middendorf, Esq., at Stoll Keenon Ogden
PLLC, in Lexington, Kentucky.
ATD CAPITOL: Capitol Supply Needs To Continue Settlement Talks
--------------------------------------------------------------
ATD Capitol, LLC, asks the U.S. Bankruptcy Court for the Southern
District of Florida to extend the exclusive periods during which
only the Debtor can file a plan of reorganization and solicit
acceptances of the the plan through and including Sept. 3, 2018,
and Nov. 2, 2018, respectively.
As reported by the Troubled Company Reporter on June 8, 2018, the
Court previously granted the Debtor an extension of its exclusive
periods to file and to solicit acceptances of a plan of
reorganization through July 5, 2018 and Sept. 3, 2018,
respectively.
On Nov. 30, 2017, the Court entered an order shortening time for
filing proofs of claim, establishing plan and disclosure statement
filing deadlines, and addressing related matters, which provided
inter alia that the Debtor's deadline for filing a plan and
disclosure statement is Feb. 6, 2018.
The Debtor further requests that the Procedures Order Deadline be
extended to through and including Sept. 3, 2018.
The Debtor requests an extension of the Procedures Deadline Order,
Exclusive Filing Period and Exclusive Solicitation Period for a
period of 60 days in order to have additional time to formulate its
plan of reorganization and disclosure statement, and permit Capitol
Supply to continue settlement negotiations with the United States
and its primary secured lender. The Debtor is generally making
required post-petition payments, and effectively managing its
operations and finances. The Debtor believes that there are
reasonable prospects for filing a viable plan.
The Debtor assures the Court that it is not seeking to use
exclusivity to pressure creditors into accepting a plan they find
unacceptable. To the contrary, extending exclusivity will allow
Capitol Supply to pursue settlement negotiations with the U.S. and
its primary secured lender, and the Debtor to formulate a plan of
reorganization and disclosure statement based on the outcome of the
negotiations without incurring legal fees associated with presently
preparing a plan and disclosure statement. The request for
extension is reasonable given the Debtor’s progress to date and
the current posture of the case. The Debtor is not seeking an
extension as a delay tactic or to
pressure creditors to accede to a plan that is unsatisfactory to
them. The Petition Date was Oct. 9, 2017. This is a relatively
insignificant period of time given the contingencies of the instant
case.
Since the Petition Date, the Debtor has devoted a significant
amount of time to complying with the requirements of operating as a
debtor-in-possession during a Chapter 11 case. The Debtor is a
wholly owned subsidiary of Capitol Supply, Inc., who is also a
debtor in a bankruptcy case pending before the Court. The Debtor's
proposed reorganization will be impacted by the outcome of the
appeal of the Court's decision with respect to a contested matter
in Capitol Supply's bankruptcy case. Specifically, Capitol Supply
obtained an order from the Court enforcing the stay against an
action by the United States, one of its largest unsecured
creditors, and Louis Scutellaro pending before the District Court
for the District of Columbia. After, the U.S. appealed the
Court’s decision to the U.S. District Court for the Southern
District of Florida, and the matter has been fully briefed. The
Debtor's proposed reorganization will also be impacted by the
outcome of Capitol Supply's negotiations with its primary secured
lender. Capitol Supply has been engaged in settlement discussions
regarding the DC Case, consensual plan terms and other related
issues with the U.S. and its primary secured creditor. The Debtor
requires additional time to permit Capitol Supply to pursue
settlement discussions with the United States and its secured
lender prior to the Debtor formulating and proposing its plan of
reorganization and disclosure statement.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/flsb17-22257-92.pdf
About ATD Capitol
ATD Capitol, LLC, was incorporated on Aug. 12 2015, and is in the
office and public building furniture business. ATD is an affiliate
of Capitol Supply, Inc., which sought bankruptcy protection (Bankr.
S.D. Fla. Case No. 17-21544) on Sept. 20, 2017.
ATD Capitol, LLC, based in Boca Raton, FL, filed a Chapter 11
petition (Bankr. S.D. Fla. Case No. 17-22257) on Oct. 9, 2017. In
the petition signed by Robert J. Steinman, president, the Debtor
estimated $100,000 to $500,000 in assets and $1 million to $10
million in liabilities. The Hon. Paul G. Hyman, Jr. presides over
the case. Bradley Shraiberg, Esq., at Shraiberg Landau & Page,
P.A., serves as bankruptcy counsel to the Debtor. An official
committee of unsecured creditors has not yet been appointed in the
Chapter 11 case.
AVISON YOUNG: S&P Cuts Issuer Credit Rating to B-, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Avison Young
(Canada) Inc. to 'B-' from 'B+'. The outlook is stable. S&P said,
"We also lowered the issue rating on Avison Young's senior secured
notes to 'B' from 'B+'. We revised the recovery rating on the
senior secured notes to '2' from '3'. The '2' recovery rating
indicates our expectation of substantial recovery (85%) of
principal in the event of a default scenario."
The rating action follows Avison Young's announcement that it
raised CAD$250 million through a preferred stock issuance to Caisse
de depot et placement du Quebec (CDPQ), a Canada-based
institutional investor. The company will use CAD$80 million of the
proceeds to redeem an institutional shareholder and certain other
non-management founders and former Principals and use the remaining
CAD$170 million as growth capital. CDPQ will also obtain three of
the nine board seats.
The stable outlook balances the additional financial flexibility
provided by the new capital and lack of near-term maturities
against our expectations for leverage to rise materially in the
short run. S&P expects Avison Young will deploy the preferred stock
proceeds judiciously to grow earnings, which could support the
additional leverage over time.
Although unlikely, S&P could lower the rating over the next 12
months if the company has difficulty growing earnings, loses market
share, or experiences pressure on liquidity.
S&P could raise the rating over the next 12 months if it expects
the company's leverage, measured as net debt to adjusted EBITDA, to
fall below 6.0x on a consistent basis and the firm scales back on
its acquisitive growth strategy, which we view as unlikely.
AVOLON HOLDINGS: Fitch Affirms 'BB' LT IDR, Outlook Stable
----------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Rating
(IDR) for Avolon Holdings Limited (Avolon) at 'BB'. Fitch has also
affirmed the Long-Term IDRs and senior unsecured debt ratings of
subsidiaries Avolon Holdings Funding Limited and Park Aerospace
Holdings Limited at 'BB'. The Rating Outlook is Stable.
These actions are being taken in conjunction with a broader
aircraft leasing industry peer review conducted by Fitch, which
includes 10 publicly rated firms.
KEY RATING DRIVERS - IDRs and Senior Debt
Avolon's credit strengths include its high quality commercial
aircraft portfolio; scale and franchise strength as one of the
world's largest aircraft leasing companies; strong profitability;
robust risk controls; and strong management track record. The
ratings are constrained by Avolon's predominantly secured funding
profile; elevated leverage; aggressive growth via its order book
and stated acquisition appetite; and qualitative considerations
surrounding Avolon's ownership structure.
Rating constraints applicable to the aircraft leasing industry more
broadly include the monoline nature of the business; vulnerability
to exogenous shocks; potential exposure to residual value risk;
sensitivity to oil prices; reliance on wholesale funding sources;
and increased competition.
At March 31, 2018, Avolon was the third largest aircraft lessor in
the world, with 903 owned, managed and committed aircraft leased to
156 customers. The largest exposures included Airbus A320 family
aircraft (43.2% of fleet count at March 31, 2018), Boeing 737
family (33.7%), Airbus A330 family (10.3%), Boeing 787 family
(3.7%) and Embraer E190/E195 (2.7%).
In addition to the diversification benefits that come with size,
Fitch believes that increased scale provides certain strategic
benefits to Avolon, such as a larger presence in the growing
Asia-Pacific market, increased purchasing/negotiating power, a
platform through which it can grow managed aircraft with
institutional partners, and more available channels to re-lease
planes when needed. For example, while Avolon had a fleet
utilization rate of 98.7% at March 31, 2018, it placed all 13
aircraft previously leased to Air Berlin PLC & Co. Luftverkehrs KG
and Monarch Airlines, which filed for bankruptcy during 2017, which
improved fleet utilization to 99.7% at June 30, 2018.
While Avolon continues to grow its owned and managed aircraft
portfolio, it is also opportunistically selling planes. At March
31, 2018, Avolon had agreements to sell 56 aircraft, valued at
approximately $1.3 billion. These agreements included 28 mid-life
aircraft in the Sapphire Aviation Finance securitization platform,
which were subsequently sold in 2Q18. Avolon also established an
asset management platform with China Cinda Asset Management Co.
Ltd. (Long-Term IDR 'A' with a Stable Outlook) known as Jade
Aviation. Avolon owns a 20% ownership interest and will be the
exclusive provider of aircraft to Jade Aviation.
Avolon generated lease yields (annualized lease revenue divided by
flight equipment, net) of 13.6% in 1Q18, up from 12.2% in 2017,
which was partially due to the timing of the acquisition of CIT
Group Inc.'s aircraft leasing business in April 2017. Fitch expects
that Avolon's lease yields will trend toward approximately 12% over
the next several years, as a result of the expected sale of higher
yielding mid-life aircraft.
Avolon has placed approximately 82% of its committed aircraft
through 2019, with 19 committed aircraft still available for lease.
The company also has 30 aircraft available for lease rolling off
through 2019. Fitch expects these aircraft to be placed. Overall,
the company's average remaining lease term was 6.6 years as of
March 31, 2018, supporting cash flow predictability absent material
lessee bankruptcies.
Fitch considers Avolon's asset quality to be strong, although this
has been supported in part by the benign economic backdrop and the
absence of material exogenous shocks. The average fleet age was 5.3
years at March 31, 2018, which is young and more liquid relative to
the majority of the aircraft lessor peer group. The fleet age
slightly declined to 5.2 years at June 30, 2018.
Avolon's order book at March 31, 2018 totaled 333 planes, including
new technology aircraft such as the A320neo, A321neo, A330neo, B737
MAX 8/9, and B787-8/9. The order book represented 58.4% of owned
and managed aircraft by fleet count at March 31, 2018, and Avolon
has signaled that further growth is possible. The order book and
other funding requirements will create a need for consistent access
to the debt markets in Fitch's opinion.
Near-term liquidity is viewed as solid as liquidity sources (cash
and liquid investments, next 12 months funds from operations,
available undrawn debt facilities, and expected proceeds from
aircraft disposals) adequately covered uses (capital expenditures,
debt principal repayments, pre-delivery payments, and other
corporate uses) by 1.3x over the next 12 months. The solid
liquidity profile is a result of Avolon's capital markets
activities, most recently a $500 million offering of five-year
senior unsecured notes in March 2018. In 2Q18, the company
re-priced, extended, and partially repaid its $5 billion Term Loan
B facility in May 2018 and also upsized its unsecured revolving
credit facility to $1.44 billion, bringing total revolver
commitments to $3.4 billion.
Avolon's ratings remain constrained by a funding profile comprised
primarily of secured debt. Approximately 26.7% of Avolon's debt was
unsecured as of March 31, 2018, which was within Fitch's 'bb'
quantitative benchmark range for balance sheet-intensive finance
and leasing companies. Still, the company had approximately $1.5
billion of unencumbered aircraft assets, which Fitch believes
provides some financial and operational flexibility.
In Fitch's opinion, Avolon's ability to execute on its business
objectives over the past year has been constrained by the highly
speculative credit risk profiles of Avolon's owner, Bohai Capital
Holding Co., Ltd. (Bohai Capital) and its majority owner, HNA Group
Co., Ltd. (HNA). Developments with respect to certain HNA
subsidiaries over the past year, such as intercompany loan activity
and delays in aircraft lease payments by certain HNA-owned
airlines, have indicated constraints on the overall organization.
While HNA has reportedly sold certain international holdings in
recent months, the firm does not publicly disclose its financial
results, making it challenging to draw definitive conclusions about
its current liquidity position. Separately, Fitch does not believe
that the recent death of the co-chairman and co-founder of HNA will
directly impact Avolon's credit profile.
The pre-existing insulation framework between Avolon and Bohai
Capital, as well as the mandatory redemption covenant introduced in
1Q18, limit the potential of capital extraction from Avolon. The
existing covenant limits additional payments to Bohai Capital to a
general basket of $800 million and a net income builder basket
representing 50% of consolidated net income from Jan. 1, 2018.
Avolon is permitted to make unlimited shareholder payments, which
include dividends, shareholder loans and share repurchases, if
consolidated total indebtedness (net debt to equity) is less than
2.5x. This ratio was 2.2x at March 31, 2018.
Avolon's gross debt to tangible common equity ratio was 3.7x as of
March 31, 2018, which reflects the payment of a $250 million
dividend to Bohai Capital in 1Q18. Fitch believes Avolon will lower
gross debt to tangible common equity to a range of 3.0x-3.5x over
the near term, driven primarily by the amortization of intangible
assets (maintenance right assets and lease premium) and the removal
of certain maintenance right assets as a result of the sale of
older aircraft.
The secured debt ratings are one notch above Avolon's Long-Term IDR
and reflect the aircraft collateral backing these obligations,
which suggest good recovery prospects.
The equalization of the unsecured debt rating with Avolon's IDR
reflects modest unsecured debt as a portion of total debt, as well
as an available pool of unencumbered assets, which suggest average
recovery prospects for unsecured debtholders.
RATING SENSITIVITIES - IDRs and Senior Debt
Avolon's ratings could benefit from execution on planned
deleveraging, resulting in gross debt to tangible common equity
approaching 3.0x, and execution on planned deleveraging at Bohai
Capital, resulting in reduced double leverage. The maintenance of a
strong separation framework, including adherence to limitations on
capital extraction and/or intercompany loans and the mandatory
redemption covenant, would also be viewed favorably.
A sustained increase in gross debt to tangible common equity above
4.0x, as a result of an increased risk appetite or asset
underperformance by Avolon's owners, may result in negative rating
momentum. Additionally, a perceived weakening of the credit risk
profiles of Avolon's direct or indirect owners;
higher-than-expected aircraft repossession activity; sustained
deterioration in financial performance or operating cash flows;
and/or material weakening of liquidity relative to financing needs
may result in negative pressure on the ratings.
Fitch has affirmed the following ratings:
Avolon Holdings Limited
-- Long-Term IDR at 'BB';
-- Senior secured debt at 'BB+'.
Avolon Holdings Funding Limited
-- Long-Term IDR at 'BB';
-- Senior unsecured notes at 'BB'.
Avolon TLB Borrower 1 (Luxembourg) S.a.r.l.
-- Long-Term IDR at 'BB';
-- Senior secured debt at 'BB+'.
Avolon TLB Borrower 1 (US) LLC
-- Long-Term IDR at 'BB';
-- Senior secured debt at 'BB+'.
CIT Aerospace International
-- Senior secured debt at 'BB+'.
CIT Aerospace LLC
-- Senior secured debt at 'BB+'.
CIT Aviation Finance III Limited
-- Senior secured debt at 'BB+'.
CIT Group Finance (Ireland)
-- Senior secured debt at 'BB+'.
Park Aerospace Holdings Limited
-- Long-Term Issuer Default Rating at 'BB';
-- Senior unsecured notes at 'BB'.
The Rating Outlook is Stable.
BARCELONA APARTMENTS: Allowed to Use Fannie Mae's Cash Collateral
-----------------------------------------------------------------
Bankruptcy Judge Barbara J. Houser grants Barcelona Apartments,
LLC's motion for authority to use cash collateral.
The Court finds that an immediate and critical need exists for the
Debtor to use cash collateral in order to continue the operation of
its business. Without such funds, the Debtor will not be able to
fund ongoing operating expenses during this sensitive period in a
manner that will avoid irreparable harm to the Debtor's estate. The
Debtor's ability to use cash collateral is vital to the
preservation and maintenance of the going concern value of the
Debtor's business and this estate.
Federal National Mortgage Association ("Fannie Mae") claims a lien
on the Debtor's real property located at 538 Westover Road in Big
Spring, Texas, on which the Debtor operates an apartment complex,
and on all rents derived therefrom.
The Debtor has requested immediate entry of the Interim Order under
Bankruptcy Rule 4001(b)(2). The authority granted in the Interim
Order to allow the Debtor to use Fannie Mae's cash collateral is
necessary to avoid immediate and irreparable harm to the Debtor's
estate.
The Court concludes that entry of the Interim Order is in the best
interest of the Debtor, its estate, and its creditors and that
implementation of the Interim Order will, among other things, allow
for the continued operation and rehabilitation of the Debtor's
existing business.
The bankruptcy case is in re: BARCELONA APARTMENTS, LLC, Debtor,
Case No. 18-31925-bjh11 (Bankr. N.D. Tex.).
A full-text copy of the Court's Findings dated June 25, 2018 is
available at https://bit.ly/2Nf5mo9 from Leagle.com.
Barcelona Apartments, LLC, Debtor, represented by Charles Brackett
Hendricks -- chuckh@chfirm.com -- Cavazos Hendricks Poirot, P.C. &
Emily Scott Wall -- wall@chfirm.com -- Cavazos Hendricks Poirot,
P.C.
About Barcelona Apartments, LLC
Barcelona Apartments, LLC is a privately held apartment complex
owner based in Big Spring, Texas.
Barcelona Apartments sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Tex. Case No. 18-31925) on June 5,
2018. In the petition signed by Alan Kuatt, managing member, FSG
Holdings, LLC, managing member of Barcelona Apartments, LLC, the
Debtor estimated assets and liabilities of less than $10 million.
The Hon. Barbara J. Houser is the case judge.
The Debtor is represented by Charles Brackett Hendricks, Esq., at
Cavazos Hendricks Poirot, P.C.
BARCELONA APARTMENTS: Can Assume Management Agreement with SunRidge
-------------------------------------------------------------------
Bankruptcy Judge Barbara J. Houser enters an interim order
authorizing Barcelona Apartments, LLC, to assume the management
agreement with SunRidge Management Group, Inc.
An immediate and critical need exists for the Debtor to authorize
the management agreement with SunRidge in order to continue the
operation of its business. Without SunRidge operating the debtor's
apartment complex, the Debtor's estate will be irreparably harmed
by disruption to SunRidge managing and overseeing the day-to-day
operations of the Debtor's property.
The Debtor has requested immediate entry of the Interim Order under
Bankruptcy Rule 6003. The authority granted in the Interim Order to
allow the Debtor to continue its agreement with SunRidge is
necessary to avoid immediate and irreparable harm to the Debtor's
estate.
The Court concludes that entry of the Interim Order is in the best
interest of the Debtor, its estate, and its creditors and that
implementation of the Interim Order will, among other things, allow
for the continued operation and rehabilitation of the Debtor's
existing business.
The bankruptcy case is in re: BARCELONA APARTMENTS, LLC, Debtor,
Case No. 18-31925-bjh-11 (Bankr. N.D. Tex.).
A full-text copy of the Court's Findings and Order dated June 25,
2018 is available at https://bit.ly/2Nggnpj from Leagle.com.
Barcelona Apartments, LLC, Debtor, represented by Charles Brackett
Hendricks -- chuckh@chfirm.com -- Cavazos Hendricks Poirot, P.C. &
Emily Scott Wall -- ewall@chfirm.com -- Cavazos Hendricks Poirot,
P.C.
About Barcelona Apartments, LLC
Barcelona Apartments, LLC is a privately held apartment complex
owner based in Big Spring, Texas.
Barcelona Apartments sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Tex. Case No. 18-31925) on June 5,
2018. In the petition signed by Alan Kuatt, managing member, FSG
Holdings, LLC, managing member of Barcelona Apartments, LLC, the
Debtor estimated assets and liabilities of less than $10 million.
The Hon. Barbara J. Houser is the case judge.
The Debtor is represented by Charles Brackett Hendricks, Esq. at
Cavazos Hendricks Poirot, P.C.
BLINK CHARGING: Fails to Comply with "Independent Director" Rule
----------------------------------------------------------------
Blink Charging Co. had provided notice to The NASDAQ Stock Market
that, effective June 30, 2018, the Company would no longer comply
with NASDAQ's independent director and audit committee requirements
due to the resignation of Andrew Shapiro from the Company's Board
of Directors and Audit Committee. As previously disclosed, Mr.
Shapiro resigned from the Board of Directors of the Company and its
Audit Committee effective June 30, 2018, and the resulting vacancy
on each of the Board of Directors and Audit Committee has not yet
been filled. Mr. Shapiro was an "Independent Director," as defined
in NASDAQ Listing Rule 5605(a)(2). As a result, a majority of the
Company's Board of Directors and its Audit Committee is no longer
comprised of Independent Directors as required by Listing Rule
5605.
On July 13, 2018, NASDAQ delivered a notice to the Company
acknowledging the Company's non-compliance with the NASDAQ
independent director and audit committee requirements and advising
that, in accordance with Listing Rules 5605(b)(1)(A) and
5605(c)(4), NASDAQ has provided the Company with a cure period in
which to regain compliance therewith. As set forth in NASDAQ's
July 13, 2018 notice, the Company must regain compliance with
Listing Rule 5605(b)(1) and Rule 5605(c)(4) by: (a) the earlier of
the Company's next annual stockholders' meeting or
June 30, 2019; or (b) if the next annual stockholders' meeting is
held before Dec. 27, 2018, then the Company must evidence
compliance no later than Dec. 27, 2018.
The Company intends to regain compliance with Listing Rule
5605(b)(1) and Rule 5605(c)(4) on or before its next annual meeting
of stockholders, which the Company intends to hold in September
2018.
About Blink Charging
Based in Miami Beach, Florida, Blink Charging Co. (OTC: CCGID),
formerly known as Car Charging Group, Inc. --
http://www.CarCharging.com/,http://www.BlinkNetwork.com/and
http://www.BlinkHQ.com/-- is a provider of public electric vehicle
(EV) charging equipment and services, enabling EV drivers to easily
charge at locations throughout the United States. Headquartered in
Florida with offices in Arizona and California, Blink Charging's
business is designed to accelerate EV adoption.
Blink Charging reported a net loss attributable to common
shareholders of $79.63 million for the year ended Dec. 31, 2017,
compared to a net loss attributable to common shareholders of $9.16
million for the year ended Dec. 31, 2016. As of March 31, 2018,
Blink Charging had $11.70 million in total assets, $9.04 million in
total liabilities and $2.65 million in total stockholders' equity.
As of March 31, 2018, the Company had cash, working capital and an
accumulated deficit of $9.94 million, $2.21 million and $154.23
million, respectively. During the three months ended March
31,2018, the Company generated net income of $2.20 million, but a
loss from operations of $3.80 million. The Company has not yet
achieved profitability from operations.
"The Company believes its current cash on hand, is sufficient to
meet its operating and capital requirements for at least twelve
months from the issuance date of these financial statements.
Thereafter, the Company will need to raise further capital through
the sale of additional equity or debt securities or other debt
instruments to support its future operations. The Company's
operating needs include the planned costs to operate its business,
including amounts required to fund working capital and capital
expenditures. The Company's future capital requirements and the
adequacy of its available funds will depend on many factors,
including the Company's ability to successfully commercialize its
products and services, competing technological and market
developments, and the need to enter into collaborations with other
companies or acquire other companies or technologies to enhance or
complement its product and service offerings," as stated in the
Company's Quarterly Report for the period ended March 31, 2018.
BOSSLER ROOFING: Delays Plan Filing to Accommodate All Claims
-------------------------------------------------------------
Bossler Roofing, Inc., asks the U.S. Bankruptcy Court for the
Southern District of Florida to extend the Debtor's exclusive
periods to file a plan of reorganization and to solicit acceptances
of its plan through and including Sept. 10, 2018, and Nov. 9, 2018,
respectively.
The Debtor's exclusivity period, under 11 U.S.C. Section 1121(b),
and the Plan deadline expires on or about July 10, 2018, pursuant
to that certain court order granting the Debtor's request to extend
the Exclusive Period to File a Plan of Reorganization and Debtor's
Exclusive Period to Solicit Acceptances Thereto Nunc Pro Tunc to
April 11, 2018.
The deadline for creditors in this case to file proofs of claims
was April 9, 2018; however, the Debtor filed a motion for
supplemental bar date, which is currently set for hearing on July
17, 2018, to allow additional creditors not listed on the initial
schedules to file a proof of claim. In that motion, the Debtor
requested a supplemental bar date of Aug. 10, 2018. Accordingly,
the Debtor requests that the exclusivity deadline be extended so
all claims be filed prior to Debtor being required to propose a
Plan of Reorganization.
The Debtor is not seeking this extension to delay the
administration of the case or to pressure creditors to accept an
unsatisfactory plan. To the contrary, the requested extension to
the Exclusive Periods will permit the Debtor to move forward in an
orderly, efficient and cost-effective manner to maximize the value
of the Debtor's assets.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/flsb17-24798-71.pdf
About Bossler Roofing
Bossler Roofing, Inc., is a Lake Worth, Florida-based roofing
company owned by Christopher Bossler. The company offers
installation services of all roofing systems, concrete roof tile
restoration, attic radiant and reflective roof coating energy
saving applications, concrete tile and asphalt shingle "Cool Roof"
energy star installations, Henry Roof Certified waterproofing (flat
roof installation) services, Poly-Foam Certified (Metro-Dade County
approved concrete and clay roof tile adhesive application)
installations, and all commercial and residential roof repairs,
from minor to major leak penetrations.
Bossler Roofing, Inc., filed a Chapter 11 petition (Bankr. S.D.
Fla. Case No. 17-24798) on Dec. 12, 2017. In the petition signed
by Christopher Bossler, its president, the Debtor disclosed
$567,055 in assets and $1.06 million in liabilities. This case is
assigned to Judge Paul G. Hyman, Jr. Craig I. Kelley, Esq., at
Kelley & Fulton, P.L., is the Debtor's general counsel.
BREDA: Sale Efforts Delay Filing of Plan of Reorganization
----------------------------------------------------------
Breda, a Limited Liability Company, and Tempo Dulu, LLC, ask the
U.S. Bankruptcy Court for the District of Maine to extend the
exclusive periods during which only the Debtors can file their
plans of reorganization and solicit acceptances of their plans for
90 days, through and including Oct. 24, 2018, and Dec. 24, 2018,
respectively.
Currently, the Exclusive Periods for the Debtors to file and
solicit acceptances to their plans expire on July 26, 2018, and
Sept. 24, 2018, respectively.
The Debtors have made, and continue to make, progress towards
formulating a consensual plan of reorganization, and the Debtors
seek an extension of the Exclusivity Periods for 90 days in order
to avoid the disruption and delay that would be caused by the
filing of competing plans. Interference at this stage of the
cases, before the Debtors have had a full and fair opportunity to
propose their own plans, would drain the value of the Debtors'
estates to the detriment of all parties, including creditors.
From the beginning of the cases, the Debtors and their
professionals have worked in good faith to develop and take initial
steps towards effectuating plans of reorganization, including
efforts to market certain of the Debtors' assets to potential
buyers. In the event Tempo Dulu is able to sell its assets, the
complexion of the cases changes considerably. Additional time is
required for the Debtors to continue pursuing these efforts and to
prepare their plans of reorganization, and the Debtors continue to
believe that they have a high likelihood of successfully
reorganizing. In the meantime, the Debtors have paid their
post-petition bills as they come due in accordance with the
Debtors' cash plans. The Debtors also have continued to operate
their inn businesses during the busy summer months in order to
reduce their reliance on postpetition financing and to develop cash
reserves that will allow the Debtors to successfully reorganize.
The Debtors, moreover, have cooperated with their creditors
throughout the bankruptcy cases, including as part of, among other
issues, the Debtors' efforts to obtain approval to use cash
collateral and to access postpetition financing.
The Debtors assure the Court that they do not seek the extensions
in order to pressure creditors to subject to their reorganization
demands, but rather to allow sufficient time for crafting viable
plans. Finally, the Debtors' bankruptcy cases remain in their
relative infancy, and it is particularly appropriate under the
facts here to extend the Exclusivity Periods beyond the initial
statutory deadlines in order to allow the Debtors to focus on their
operations through the summer, after which they will be in a better
position to finalize and obtain approval of their reorganization
plans.
A copy of the Debtors' request is available at:
http://bankrupt.com/misc/meb18-20157-138.pdf
About Breda and Tempo Dulu
Breda, a Limited Liability Company, and Tempo Dulu, LLC, own the
Camden Harbour Inn and the Danforth Inn located in Camden and
Portland, Maine, respectively.
Breda and Tempo Dulu sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Maine Case No. 18-20157) on March 28,
2018. In the petitions signed by Raymond Brunyanszki, member, the
Debtors each estimated assets of $1 million to $10 million and
liabilities of $1 million to $10 million. Judge Michael A. Fagone
presides over the case. The Debtors tapped Bernstein, Shur, Sawyer
& Nelson, P.A., as their legal counsel.
BRIDAN 770: Has Until Sept. 24 to Exclusively File Plan
-------------------------------------------------------
The Hon. Robert A. Mark of the U.S. Bankruptcy Court for the
Southern District of Florida has extended, at the behest of Bridan
770, LLC, the exclusive period for the Debtor to file and solicit
acceptances to a Chapter 11 plan through and including Sept. 24,
2018, and Nov. 23, 2018.
A copy of the court order is available at:
http://bankrupt.com/misc/flsb17-20940-57.pdf
As reported by the Troubled Company Reporter on April 26, 2018, the
Court previously extended the exclusive period for the Debtor to
file and solicit acceptances to a plan to June 25, 2018, and Aug.
24, 2018, respectively. The Court noted that Lender Bayview Loan
Servicing has agreed and the U.S. Trustee has no objection to
extension.
About Bridan 770
Bridan 770, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
S.D. Fla. Case No. 17-20940) on Aug. 29, 2017, estimating $100,000
to $500,000 in both assets and liabilities. The petition was signed
by its authorized representative, Laurent Benzaquen of AMBR JJLB
Property Management LLC. Bridan 770, LLC, and debtor-affiliate JXB
84 LLC, tapped Joel M. Aresty, Esq., P.A., as counsel. An official
committee of unsecured creditors has not been appointed in the
Chapter 11 case.
CAPITAL TEAS: Needs Additional Time to Exclusively File Plan
------------------------------------------------------------
Capital Teas, Inc., asks the U.S. Bankruptcy Court for the District
of Maryland to extend the exclusive period during which only the
Debtor can file a plan of reorganization and solicit acceptance of
the plan through and including Nov. 3, 2018, and Jan. 2, 2019,
respectively.
As reported by the Troubled Company Reporter on April 5, 2018, the
Court previously entered a second order extending the exclusive
periods within which Capital Teas, Inc., may file its plan of
reorganization by July 6, 2018, and obtain acceptances thereto by
Sept. 4, 2018.
Cause exists in this case to extend the Exclusive Filing and
Acceptance
Periods by 120 days because: (a) the nature and complexity of the
case warrants additional time; (b) the additional time will afford
the parties time to negotiate a plan of reorganization that would
provide a meaningful distribution to the Debtor’s creditors; (c)
the Debtor is working in good
faith towards reorganization; (d) the Debtor has made substantial
progress in its case; and (e) the extension will not prejudice any
party in interest and will enable the Debtor to conserve its
resources by not being forced to respond to competing plans.
The complexity of the Debtor’s Chapter 11 case constitutes cause
to extend the Exclusive Filing and Acceptance Periods
Th case is complex because the Debtor has significantly
reorganized, resized and reprioritized its operations and revenue
streams since the Petition Date. The Debtor is leaner than before,
but it will take additional time for the Debtor to determine how
the current operations will perform to support a feasible plan of
reorganization. Since the Petition Date, the Debtor closed
seventeen stores and is currently operating six retail locations.
During this same period, the Debtor has increased its efforts to
grow its online and wholesale operations
Due to the timing of certain post-petition payments, as well as the
Debtor’s purchase of an urgently needed point-of-sale system that
depleted its funds reserved for operations, the Debtor required
additional financing. On Feb. 21, 2018, the Debtor obtained the
Court’s approval of aditional debtor-in-possession financing in
the amount of $300,000 from Willard Umphrey The Original Lender
extended $175,000 of the $300,000 commitment in February 2018
($100,000) and March 2018 ($75,000). Thereafter, the Original
Lender informed the Debtor that it would cease making any further
advancements. The Debtor immediately sought other sources of
financing. In late June 2018, the Debtor identified a potential new
lender.
The Debtor and potential lender are actively analyzing the best
strategy for the Debtor’s reorganization, which warrants
extending exclusivity as requested.
The Debtor assures the Court that it is moving expeditiously to
adapt its operations to the everchanging retail landscape and
increased web-based market. At the same time, the Debtor is
negotiating with various landlords on terms that may form the
foundation of a plan of reorganization.
The Debtor is working closely with its counsel to prepare adequate
information to properly assess the options available to it.
Further, in pursuing these options, the Debtor anticipates active
involvement with its creditors, the Committee and other parties in
interest and additional time is warranted.
Since the filing of the Petition, the Debtor has worked diligently
to reorganize its affairs. On June 22, 2018, the Debtor obtained
Court approval to sell certain surplus assets through R.L. Rasmus
Auctioneers, Inc. that generated a gross sale amount of $26,868.75.
After paying the auctioneer's commission, the Debtor expects to
receive approximately $18,808 in net proceeds. The net proceeds
will be applied against rent and the retainer for Committee
counsel. This sale is indicative of the Debtor’s efforts to
stabilize its operations and generate cash to pay necessary
expenses.
The Debtor is forming the terms of its plan. Accordingly, the
Debtor is requesting additional time to maintain the exclusive
right to formulate the plan plan and pursue confirmation.
Pogress in formulating a plan in the face of creditor recalcitrance
or unusual procedural or substantive difficulties or developments
in the case may ... establish the requisite 'good cause' for the
extension of the exclusivity periods).
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/flsb17-21544-198.pdf
About Capital Teas
Capital Teas, Inc. -- http://www.capitalteas.com/-- is a retailer
offering green, white, black, oolong, rooibos, mate, fruit tisane,
and herbal tea products. It first opened its doors in 2007. Peter
Martino is chief executive officer of the Company.
Capital Teas sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Md. Case No. 17-19426) on July 11, 2017. In the
petition signed by CEO Peter Martino, the Debtor estimated assets
and liabilities of $1 million to $10 million.
Judge Robert A. Gordon presides over the case.
Lawrence J. Yumkas, Esq., and Lisa Yonka Stevens, Esq., at Yumkas,
Vidmar, Sweeney & Mulrenin, LLC, serve as the Debtor's legal
counsel.
The U.S. Trustee for Region 4 on July 24, 2017, appointed three
creditors to serve on the official committee of unsecured creditors
in the Chapter 11 case. The committee members are: (1) Julie
Minnick Bowden of GGP Limited Partnership; (2) Holger Lohs of
Haelssen and Lyon NA Corp.; and (3) Silvia Rettore of Dethlefsen &
Balk, Inc. The Creditors Committee tapped Michael Best & Friedrich
LLP as counsel, and National CRS, LLC as financial advisor.
CAPITOL SUPPLY: Wants Settlement Talks With Bank of America
-----------------------------------------------------------
Capitol Supply, Inc., asks the U.S. Bankruptcy Court for the
Southern District of Florida to extend the exclusive periods during
which only the Debtor can file a plan of reorganization through and
including Sept. 3, 2018, and Nov. 2, 2018, respectively.
On June 27, 2018, the Court held a hearing on and granted the
Debtor's request to Extend Exclusivity and Solicitation Periods and
Plan Filing Deadline, and extended the Exclusive Filing Period to
July 5, 2018, the Exclusive Solicitation Period to Sept. 3, 2018,
and the Procedures Order Deadline to July 5, 2018. A copy of the
court order is available at:
http://bankrupt.com/misc/flsb17-21544-198.pdf
As reported by the Troubled Company Reporter on June 8, 2018, the
Debtor previously asked the Court for an extension of the exclusive
filing period for a period of 31 days to through and including July
5, 2018, and an extension of the exclusive solicitation period for
a period of 31 days to through and including Sept. 3, 2018.
The Debtor further requests that the Procedures Order Deadline be
extended to through and including July 5, 2018.
Since the Petition Date, the Debtor has devoted a significant
amount of time to (a) complying with the requirements of operating
as a debtor-in-possession during a Chapter 11 case, (b) defending
the appeal of the Court's order granting in part the Debtor's
motion to enforce the automatic stay against an action by the
United States and Louis Scutellaro pending before the District
Court for the District of Columbia, (c) negotiating the sale of the
Debtor's interest in certain agreements and related business
divisions with proposed sellers and the Debtor's secured lender,
(d) obtaining court approval of sales and related contract
assignments, and (e) preparing cash budgets for continued use of
cash collateral and projections for a plan.
Additionally, the Debtor is in settlement discussions with one of
its largest unsecured creditors, the United States, with respect to
the claims asserted in the DC Case, and with its secured lender,
Bank of America, with respect to potential consensual plan terms.
As a result, the Debtor requires additional time pursue settlement
discussions with the United States and Bank of America and to
formulate its plan of reorganization. Further, Bradley S.
Shraiberg, counsel for the Debtor who has been primarily engaged in
the foregoing negotiations, will be out of the country for personal
travel beginning June 6, 2018 through June 20, 2018.
The Debtor further seeks extension of the Procedures Deadline Order
and the Exclusivity Periods in order to place the deadlines on the
same track as the deadlines for its subsidiary, ATD Capitol, LLC,
which is also a debtor-in-possession, as set forth in the Order
Granting Debtor's Motion to Extend Exclusivity and Solicitation
Periods and Related Plan Deadline.
The Debtor further requests that the Procedures Order Deadline be
extended to through and including Sept. 3, 2018. On Oct. 20, 2017,
the Court entered an Order Shortening Time for Filing Proofs of
Claim, Establishing Plan and Disclosure Statement Filing Deadlines,
and Addressing Related Matters, which provided inter alia that the
Debtor’s deadline for filing a plan and disclosure statement is
Jan. 18, 2018.
Since the Petition Date, the Debtor has devoted a significant
amount of time to complying with the requirements of operating as a
debtor-in-possession during a Chapter 11 case, defending the appeal
of the Court's order granting in part the Debtor's motion to
enforce the automatic stay against an action by the United States
and Louis Scutellaro pending before the District Court for the
District of Columbia, negotiating the sale of the Debtor's interest
in certain agreements and related business divisions with proposed
sellers and the Debtor's secured lender, obtaining court approval
of such sales and related contract assignments, and preparing cash
budgets for continued use of cash collateral and projections for a
plan.
Additionally, the Debtor is in settlement discussions with one of
its largest unsecured creditors, the United States, with respect to
the claims asserted in the DC Case, and with its secured lender,
Bank of America, with respect to potential consensual plan terms.
As a result, the Debtor requires additional time pursue such
settlement discussions with the U.S. and Bank of America and to
formulate its plan of reorganization.
The Debtor requests an extension of the Procedures Deadline Order,
Exclusive Filing Period and Exclusive Solicitation Period for a
period of 60 days in order to have additional time to formulate its
plan of reorganization and pursue settlement negotiations with the
United States and Bank of America. The Debtor is generally making
required postpetition payments, and effectively managing its
operations and finances. The Debtor believes that there are
reasonable prospects for filing a viable plan.
The Debtor assures the Court that it is not seeking to use
exclusivity to pressure creditors into accepting a plan they find
unacceptable. To the contrary, extending exclusivity will allow
the Debtor to pursue settlement negotiations with the United States
and Bank of America, and formulate a plan of reorganization based
on the outcome of such negotiations without incurring legal fees
associated with presently preparing a plan and disclosure
statement.
The Debtor says that it is not seeking an extension as a delay
tactic or to pressure creditors to accede to a plan that is
unsatisfactory to them. The Petition Date was Sept. 20, 2017.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/flsb17-21544-199.pdf
About Capitol Supply
Since 1983, Capitol Supply, Inc., has provided the United States
Government, the U.S. Military, State and local government agencies
and consumer and commercial customers worldwide various products
needed to operate their businesses. Capitol Supply offers office
supply, office furniture, hardware, tools, auto parts, cleaning
supplies, dorms and quarters, package room, and GSA schedule
needs.
Capitol Supply was formerly known as Capitol Furniture Distributing
Company and changed its name to Capitol Supply, Inc., in March
2005.
Capitol Supply, based in Boca Raton, Florida, filed a Chapter 11
petition (Bankr. S.D. Fla. Case No. 17-21544) on Sept. 20, 2017.
In the petition signed by CEO Robert J. Steinman, the Debtor
estimated $1 million to $10 million in both assets and liabilities.
The Hon. Erik P. Kimball presides over the case. Bradley S.
Shraiberg, Esq., at Shraiberg Landaue & Page, P.A., serves as
bankruptcy counsel to the Debtor.
CARTER COUNTY, KY: S&P Lowers 2012 GO Bonds Rating to 'BB+'
-----------------------------------------------------------
S&P Global Ratings lowered its underlying rating (SPUR) to 'BB+'
from 'A-' on Carter County, Ky.'s series 2012 general obligation
(GO) bonds, while assigning a negative outlook, reflecting the
county's weak management conditions, very weak liquidity, and
budgetary pressures. S&P then withdrew the rating.
"The downgrade and negative outlook reflect our view of long-term
pressure on the county's credit quality," said S&P Global Ratings
credit analyst Caroline West, "and then, in accordance with our
information quality standards, we are withdrawing the rating due to
a lack of sufficient, timely, and reliable information required to
evaluate credit quality."
The county's fiscal 2017 audit (June 30 year-end) is not yet
available, and officials indicate that auditors will begin their
work in the county in August 2018 for the fiscal 2017 audit. The
state published the county's most recent audit, dated June 30,
2016, in April 2018, or after a 22-month lag following year-end.
"We believe the county is unable to produce timely and sufficient
audits," said Ms. West, "and absent reliable financial statements
and complete information from the county, we cannot measure the
county's financial performance and so are unable to maintain our
rating on the county's bonds." Preceding the withdrawal, we are
lowering the rating based on the current, limited information
available, including the county's fiscal 2016 audit, year-end 2017
report that it submitted to the state, 2018 and 2019 budget
documents provided to us by county officials, and other information
provided to us by management.
The county's full-faith-and-credit pledge secures the 2012 bonds.
Carter County, with an estimated population of 27,022, is in
northeastern Kentucky, 97 miles east of Lexington.
CELADON GROUP: Closes Amendment to Credit Agreement
---------------------------------------------------
Celadon Group, Inc. has closed its previously disclosed credit
agreement amendment.
On July 13, 2018, the Company entered into an Eleventh Amendment to
its existing credit agreement. The terms of the Amendment are
consistent with the expected terms announced on July 3, 2018, and
include the following:
Amendment Period: July 13- December 12, 2018
Maximum Outstanding
Amount: Increase to $230 million through Dec. 1,
2018, then decreasing to $170 million
Pricing: Base Rate plus 8.00%
Commitment Fee: Monthly commencing October at the rate of
0.45% of the Aggregate Commitments, which
are currently $250 million
Additional Collateral: Pledge of Canadian and Mexican assets;
Cash dominion
Financial Covenants: Comprised of the following, set at levels
reflecting the Company's budget plus
customary cushion:
-- Lease-Adjusted Total Debt to EBITDAR
Ratio
-- Fixed Charge Coverage Ratio
-- Asset Coverage Ratio
-- Maximum Disbursements
The full-text of the Amendment is available for free at:
https://is.gd/VG6for
About Celadon
Celadon Group, Inc. -- http://www.celadongroup.com/-- provides
long haul, regional, local, dedicated, intermodal,
temperature-protect, and expedited freight service across the
United States, Canada, and Mexico. The Company also owns Celadon
Logistics Services, which provides freight brokerage services,
freight management, as well as supply chain management solutions,
including logistics, warehousing, and distribution. The Company is
headquartered in Indianapolis, Indiana.
In a press release dated April 2, 2018, Celadon stated that based
on issues identified in connection with the Audit Committee
investigation and management's review, financial statements for
fiscal years ended June 30, 2014, 2015, 2016, and the quarters
ended Sept. 30 and Dec. 31, 2016, will be restated. Celadon's new
senior management team, led by the Company's new chief financial
officer and new chief accounting officer, commenced a review of the
Company's current and historical accounting policies and
procedures. The internal investigation and management review have
identified errors that will require adjustments to the previously
issued 2014, 2015, 2016, and 2017 financial statements.
On March 30, 2018, the Company entered into an Eighth Amendment to
its Amended and Restated Credit Agreement. The Amendment extended
the existing financial covenant relief through April 30, 2018, with
the principal purpose of permitting the Company and the revolving
lenders to evaluate the recently received refinancing proposal.
On April 18, 2018, Peter Elkins, lead analyst at the New York Stock
Exchange LLC, filed a Form 25 with the Securities and Exchange
Commission notifying the removal from listing or registration of
Celadon's common stock on the Exchange.
CELLECTAR BIOSCIENCES: Reports Positive Phase 2 Data for CLR 131
----------------------------------------------------------------
Cellectar Biosciences announced positive interim results from the
company's Phase 2 clinical trial for its lead product candidate CLR
131, in patients with diffuse large B-cell lymphoma (DLBCL). After
a single 25.0 mCi/m2 IV administration of CLR 131, patients with
relapsed/refractory DLBCL were assessed for response. These
interim data show a 33% overall response rate (ORR) and a 50%
clinical benefit response (CBR). In addition, the observed
responses to date show overall tumor reduction ranged from 60% to
greater than 90%. As a result of these favorable outcomes, the
company has expanded this cohort to include up to 30 additional
patients.
"We are very encouraged by the strong response rates and meaningful
reductions in tumor volumes seen in the trial to date in this very
sick and heavily pretreated relapsed/refractory DLBCL patient
population," stated James Caruso, president and chief executive
officer of Cellectar Biosciences. "We believe these data combined
with the activity seen to date in other hematologic malignancies
further validate the continued development of CLR 131."
The DLBCL cohort of this Phase 2 trial was initiated in January
2018 and represents the fourth B-cell hematologic cancer to be
studied in the trial. All DLBCL patients enrolled are required to
have relapsed or refractory disease to multidrug chemotherapy
regimens containing rituximab and an anthracycline. Part of the
funding for this study is provided by a multimillion-dollar NCI
Fast Track SBIR grant.
About Cellectar Biosciences
Cellectar Biosciences -- http://www.cellectar.com/-- is a clinical
stage biopharmaceutical company focused on the discovery,
development and commercialization of targeted treatments for cancer
and leveraging its proprietary phospholipid drug conjugate (PDC)
platform to develop the next generation of tumor targeting
treatments. Its headquarters are located in Madison, Wisconsin.
The report from the Company's independent accounting firm Baker
Tilly Virchow Krause, LLP, in Madison, Wisconsin, on the
consolidated financial statements for the year ended Dec. 31, 2017,
includes an explanatory paragraph stating that the Company has
suffered recurring losses from operations and has a net capital
deficiency that raise substantial doubt about its ability to
continue as a going concern.
Cellectar reported a net loss attributable to common stockholders
of $15.01 million for the year ended Dec. 31, 2017, following a net
loss attributable to common stockholders of $9.36 million for the
year ended Dec. 31, 2016. As of March 31, 2018, Cellectar had
$9.56 million in total assets, $2.11 million in total liabilities
and $7.45 million in total stockholders' equity.
CHICAGO, IL: Moody's Affirms Ba2 Rating on 2010A COPs
-----------------------------------------------------
Moody's Investors Service has affirmed the Ba2 rating on the City
of Chicago, IL's outstanding Certificates of Participation
(MetraMarket of Chicago, LLC Redevelopment Project), Series 2010A
and the Ba3 rating on the outstanding Certificates of Participation
(Fullerton/Milwaukee Redevelopment Project), Series A.
Concurrently, the outlook has been revised to stable from negative.
This rating action impacts approximately $7.8 million of
outstanding debt.
RATINGS RATIONALE
The COPs ratings reflects a modest incremental assessed valuation
with a history of volatility and strong debt service coverage. The
ratings also consider the relationship of the tax increment
financing districts to the city's GO credit profile. The Ba3 rating
on the Fullerton/Milwaukee COPs further incorporates the
subordinate lien on the pledged revenues, which is first used to
pay certain series of GO debt. The incremental assessed valuation
associated with the Fullerton/Milwaukee COPs is significantly
smaller than that of the MetraMarket COPs.
RATING OUTLOOK
The stable outlook reflects Moody's expectation that coverage will
remain sound and is in line with the City of Chicago's stable
rating outlook. The city is responsible for the collection of
revenues that are ultimately pledged to repay the COPs.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Upward movement in Chicago's GO rating
- Expansion of the economic base from which TIF revenues are
generated
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Downward movement in Chicago's general obligation rating
- Changes to existing redevelopment agreements or TIF legislation
that impairs revenues pledged to debt service on the COPs
- Steady declines in incremental equalized assessed valuation
that reduces revenue pledged to debt service on the COPs
LEGAL SECURITY
The MetraMarket COPs, Series 2010A, and the Fullerton/Milwaukee
COPs, Series 2011A, are secured by a pledge of payments made by the
city on developers' notes to finance redevelopment in the
respective TIF districts. Neither series of COPs is an obligation
of the City of Chicago. The city's payments on the respective
development notes have been assigned to the trustees by the
developers as security on the COPs.
PROFILE
In February 2006, the City of Chicago entered into a redevelopment
agreement (RDA) agreement with three developers. The developers
financed redevelopment projects in Chicago's Fullerton/Milwaukee
TIF district in exchange for $4.16 million in payments from the
city. In August 2008, the City of Chicago entered into a separate
RDA with two developers. The developers agreed to finance
redevelopment projects in Chicago's River West TIF district in
exchange for $8.0 million in payments from the city. The payments
from the city to the developers were represented by Tax Increment
Allocation Revenue Notes. To monetize the city notes, the
developers arranged for the issuance of the COPs.
The City of Chicago is neither the issuer nor the obligor of the
COPs, but its payments on developer notes have been assigned to a
trustee by the developers as security on the COPs.
COLLEGE PARK: Unsecureds to Get 20% Distribution in Latest Plan
---------------------------------------------------------------
College Park Investments, LLC, filed a disclosure statement in
support of its amended plan of reorganization dated June 29, 2018.
The amended plan provides that the Debtor will seek Bankruptcy
Court approval to sell the Maryland Property to the Purchaser,
defined by the Plan as either Crystal Development, LLC or another
party that offers to purchase the Property at a higher or better
price. The Debtor will seek Court approval of bid procedures that
will define the terms by which other interested parties can submit
competing bids to purchase the Property. The competing bids will
need to (i) be sufficient to pay Crystal Development, LLC any
breakup fee approved by the Bankruptcy Court, and (ii) be greater
than the price offered by Crystal Development, LLC by a
Court-approved margin, after taking into account the breakup fee to
be paid. Only bids that meet this and other criteria established by
the Bankruptcy Court will be considered qualified bids.
Assuming there are two or more such qualified bids (including the
offer of Crystal Development, LLC), an auction will be held, at the
conclusion of which the Debtor will determine which submitted bid
is the highest and best offer for the Property. Following the
conclusion of the auction, a hearing will be held for the purpose
of obtaining Bankruptcy Court approval of the winning bid and
authority to sell the Property to the winning bidder following
confirmation of the Plan. If the only qualified bidder is Crystal
Development, LLC, then it will not be necessary to conduct an
auction and the Debtor will seek approval of the Contract of Sale
as currently drafted.
The Property will be sold to the winning bidder, who will be the
Purchaser, free and clear of all liens, Claims and encumbrances,
with existing liens attaching to the proceeds of sale in the same
order of priority in which they currently exist. The net proceeds
of sale of the Property, after the payment of closing costs
associated with the sale, will be distributed first to pay the
Allowed Claims in Classes 1 and 2, with applicable interest. The
funds remaining after the distributions to Classes 1 and 2, and
after a reserve is funded for the payment of United States Trustee
fees, will be paid to the Senior Secured Lender on account of its
Allowed Class 3 Secured Claim. However, from the amount of
Available Cash that would otherwise be paid to the Senior Secured
Lender, the sum of $30,000 (the "Class 3 Carveout") will be used to
pay the Allowed Claims, in whole or in part, of other creditors.
First, the Class 3 Carveout will be used to pay in full the holder
of the Allowed Class 4 Claim, with interest at the Legal Interest
Rate, and any remaining Allowed Administrative Expense Claims. From
the remaining portion of Available Cash and the Class 3 Carveout,
the Debtor will next make distributions on a Pro Rata basis to
non-insider general unsecured creditors with Allowed Class 5 Claims
until each Holder of an Allowed Class 5 Claim has received 20% of
its Allowed Claim.
Once the Holders of Allowed Class 5 Claims have received 20% of
their Allowed Claims, the remaining Available Cash will be
distributed to the Senior Secured Lender to repay the Class 3
Carveout, with interest at the contractual non-default rate.
Provided the Class 3 Carveout is repaid with interest, the holders
of Allowed Class 5 Claims then will receive an additional Pro Rata
distribution from Available Cash until the Allowed Class 5 Claims
are paid in full with interest at the Legal Interest Rate. At that
point, if there is additional Available Cash on hand, each holder
of an Allowed Class 6 Claim will receive a Pro Rata distribution
until the Allowed Class 6 Claims are paid in full and the balance
of Available Cash, if any, will be paid to the Holder of the 100%
Equity Interest in the Debtor. In the event there are insufficient
funds to pay holders of all Allowed Claims in full as provided
under the Plan, the Equity Interest shall be forfeited.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/mdb17-22678-95.pdf
A copy of the Amended Plan is available at:
http://bankrupt.com/misc/mdb17-22678-94.pdf
About College Park Investments
College Park Investments, LLC and its affiliate Stein Properties,
Inc., own and lease real properties. College Park's principal
assets are located at 7302 Yale Avenue College Park, Maryland.
Stein Properties owns a real property at 10840 Little Patuxent
Parkway Columbia, Maryland.
College Park and Stein Properties sought protection under Chapter
11 of the Bankruptcy Code (Bankr. D. Md. Case Nos. 17-22678 and
17-22680) on September 22, 2017. Bruce S. Jaffe, its manager,
signed the petitions.
At the time of the filing, College Park disclosed that it had
estimated assets and liabilities of $1 million to $10 million.
Stein Properties estimated $1 million to $10 million in assets and
$10 million to $50 million in liabilities.
CONCORDIA INTERNATIONAL: Files SEC Form 25-NSE
----------------------------------------------
The Nasdaq Stock Market LLC has filed with the Securities and
Exchange Commission a Form 25-NSE to report the removal from
listing or registration under Section 12(b) of the Securities
Exchange Act of 1934 of Concordia International Corp.'s common
stock from the Exchange.
About Concordia
Based in Ontario, Canada, Concordia -- http://www.concordiarx.com/
-- is an international specialty pharmaceutical company with a
diversified portfolio of more than 200 patented and off-patent
products, and sales in more than 90 countries. Going forward, the
Company is focused on becoming a leader in European specialty,
off-patent medicines. Concordia operates out of facilities in
Oakville, Ontario and, through its subsidiaries, operates out
facilities in Oakville, Ontario and, through its subsidiaries,
operates out of facilities in Bridgetown, Barbados; London, England
and Mumbai, India.
Concordia reported a net loss of US$1.59 billion for the year ended
Dec. 31, 2017, compared to a net loss of US$1.31 billion for the
year ended Dec. 31, 2016. As of March 31, 2018, Concordia had
US$2.32 billion in total assets, US$4.30 billion in total
liabilities and a total shareholders' deficit of US$1.97 billion.
* * *
Moody's Investors Service downgraded the Corporate Family Rating of
Concordia to 'Ca' from 'Caa3'. "Concordia's Ca Corporate Family
Rating reflects its very high financial leverage, ongoing operating
headwinds, and imminent risk of a debt restructuring. Moody's
estimates adjusted debt/EBITDA will exceed 9.0x over the next 12
months as earnings decline on a year over year basis," as reported
by the TCR on Oct. 27, 2017.
Also in October 2017, S&P Global Ratings lowered its corporate
credit rating on Concordia to 'SD' from 'CCC-' and removed the
rating from CreditWatch, where it was placed with negative
implications on Sept. 18, 2017. "The downgrade follows Concordia
International's announcement that it failed to make the Oct. 16,
2016, interest payment on the 7% senior unsecured notes due 2023.
Given our view of the company's debt level as unsustainable, and
ongoing restructuring discussions, we do not expect the company to
make a payment within the grace period," S&P said.
CONCORDIA INTERNATIONAL: Stock Delisted From Nasdaq
---------------------------------------------------
As a result of Concordia International Corp.'s decision not to
submit a plan to regain compliance with NASDAQ Global Select
Market's continued listing requirements, which decision was
announced by Concordia in a press release on May 31, 2018, Nasdaq
has determination to delist the Company's securities.
As part of Concordia's proposed transaction to realign its capital
structure, lenders supporting the transaction have requested that
the Company delist its common shares from Nasdaq.
Concordia's stock was suspended from trading on Nasdaq on June 8,
2018, and has not traded on Nasdaq since that time. Nasdaq filed
on July 19, 2018 a Form 25 with the Securities and Exchange
Commission to complete the delisting. The delisting becomes
effective 10 days after the Form 25 is filed.
The Company's common shares continue to be listed on the Toronto
Stock Exchange.
About Concordia
Based in Ontario, Canada, Concordia -- http://www.concordiarx.com/
-- is an international specialty pharmaceutical company with a
diversified portfolio of more than 200 patented and off-patent
products, and sales in more than 90 countries. Going forward, the
Company is focused on becoming a leader in European specialty,
off-patent medicines. Concordia operates out of facilities in
Mississauga, Ontario and, through its subsidiaries, operates out of
facilities in Bridgetown, Barbados; London, England and Mumbai,
India.
Concordia reported a net loss of US$1.59 billion for the year ended
Dec. 31, 2017, compared to a net loss of US$1.31 billion for the
year ended Dec. 31, 2016. As of March 31, 2018, Concordia had
US$2.32 billion in total assets, US$4.30 billion in total
liabilities and a total shareholders' deficit of US$1.97 billion.
* * *
Moody's Investors Service downgraded the Corporate Family Rating of
Concordia to 'Ca' from 'Caa3'. "Concordia's Ca Corporate Family
Rating reflects its very high financial leverage, ongoing operating
headwinds, and imminent risk of a debt restructuring. Moody's
estimates adjusted debt/EBITDA will exceed 9.0x over the next 12
months as earnings decline on a year over year basis," as reported
by the TCR on Oct. 27, 2017.
Also in October 2017, S&P Global Ratings lowered its corporate
credit rating on Concordia to 'SD' from 'CCC-' and removed the
rating from CreditWatch, where it was placed with negative
implications on Sept. 18, 2017. "The downgrade follows Concordia
International's announcement that it failed to make the Oct. 16,
2016, interest payment on the 7% senior unsecured notes due 2023.
Given our view of the company's debt level as unsustainable, and
ongoing restructuring discussions, we do not expect the company to
make a payment within the grace period," S&P said.
CONDUENT BUSINESS: Moody's Affirms Ba3 CFR, Outlook Stable
----------------------------------------------------------
Moody's Investors Service affirmed Conduent Business Services,
LLC's Ba3 Corporate Family Rating, Ba3-PD Probability of Default
Rating, the B2 rating on the issuer's unsecured notes as well as
its SGL-2 Speculative Grade Liquidity rating. Concurrently, Moody's
downgraded its rating on Conduent Business' (as well as Affiliated
Computer Services International B.V.'s senior secured credit
facilities from Ba2 to Ba3. The downgrade of the bank loan ratings
reflects the transition of Conduent Business' debt structure
largely to a single class of debt following the repurchase of
approximately $476 million of its 10.5% senior notes, significantly
reducing first-loss support previously provided by these bonds. The
ratings outlook is stable
Moody's affirmed the following ratings:
Issuer: Conduent Business Services, LLC:
Corporate Family Rating- Ba3
Probability of Default Rating- Ba3-PD
Senior Unsecured Notes due 2024 -- B2 (LGD6 from LGD5)
Speculative Grade Liquidity Rating -- SGL-2
Moody's downgraded the following ratings:
Issuer: Conduent Business Services, LLC:
Senior Secured Term Loan A due 2022 -- to Ba3 (LGD3) from Ba2
(LGD2)
Senior Secured Term Loan B due 2023 -- to Ba3 (LGD3) from Ba2
(LGD2)
Senior Secured Revolving Credit Facility expiring 2022 -- to Ba3
(LGD3) from Ba2 (LGD2)
Issuer: Affiliated Computer Services International B.V.
Senior Secured Term Loan A due 2022 -- to Ba3 (LGD3) from Ba2
(LGD2)
The outlook on all issuers is stable.
RATINGS RATIONALE
Conduent Business' Ba3 CFR is constrained by the moderate pro forma
debt leverage of the issuer and its parent company, Conduent
Incorporated ("Conduent"), of approximately 3x as well as
competitive pressures from larger rivals and competitors in lower
cost regions. Additionally, the CFR considers Conduent's
susceptibility to weakening pricing trends which weigh on sales
growth prospects and overall business performance. The CFR is
supported by Conduent's scale and solid market position as a
provider of business process services to governments as well as
clients operating in the healthcare industry and other private
sector markets. Additionally, Conduent's highly recurring revenue
base, longstanding customer relationships, and high client
retention rates provide strong top-line visibility that buttress
the company's credit profile.
The Ba3 rating for the senior secured credit facility reflects
Conduent Business' Ba3-PD Probability of Default Rating ("PDR") and
a Loss Given Default ("LGD") assessment of LGD3. The rating on the
credit facility is consistent with the CFR and takes into account
that the issuer's debt structure is now largely comprised of a
single class of debt and a material amount of non-debt liabilities
following the repurchase of nearly all of the company's 10.5%
senior notes rated B2 (LGD6). The credit facility and senior notes
are guaranteed by Conduent as well as each of Conduent Business'
direct and indirect material wholly-owned domestic subsidiary
guarantors (as defined).
Conduent's SGL-2 rating is supported by Moody's expectation that
the company will maintain a cash balance of around $400 million
($461 million as of March 31, 2018) and generate pro forma free
cash flow ("FCF") of about $200 million over the coming year (7% of
adjusted total debt). Liquidity is expected to improve moderately
over the intermediate term as cost savings initiatives drive
improved FCF generation. Additionally, liquidity is bolstered by
the company's undrawn $750 million revolving credit facility due in
2022. The issuer's bank facilities are subject to a financial
maintenance covenant requiring that Conduent's maximum net leverage
ratio does not exceed 4.25x with a step-down to 3.75x on December
31, 2018. Moody's expects the company to remain well in compliance
with this covenant over the next 12-18 months.
The stable outlook reflects Moody's expectations that Conduent's
sales will decline by approximately 2% (pro forma for asset
divestitures) in 2018 as weakening pricing trends (at a
decelerating pace) are expected to constrain sales growth prospects
before a slight potential recovery in the top-line in 2019. Ongoing
progress in cost reduction efforts should moderately bolster
profitability margins, driving mid-single digit improvement in
adjusted EBITDA during 2018 and reducing debt leverage to modestly
below 3x.
FACTORS THAT COULD LEAD TO AN UPGRADE
The ratings could be upgraded if Conduent realizes organic sales
growth, demonstrates meaningful improvements in profitability and
FCF generation, and adheres to conservative financial policies.
FACTORS THAT COULD LEAD TO A DOWNGRADE
The ratings could be downgraded if Conduent's sales continue to
decline, efforts to drive profitability and FCF expansion stall, or
the company is meaningfully negatively impacted by litigation
claims, resulting in a material increase in debt leverage.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Conduent, the parent of Conduent Business, is a provider of
business process services to clients operating in the healthcare
industry and other private sector markets as well as domestic and
foreign governments. Moody's forecasts that the company will
generate pro forma sales of $5.3 billion in 2018.
CORNBREAD VENTURES: Aug. 9 Plan Confirmation Hearing Set
--------------------------------------------------------
Judge Brenda K. Martin of the U.S. Bankruptcy Court for the
District of Arizona has approved the disclosure statement
explaining Cornbread Ventures, LP's Amended Plan of
Reorganization.
A hearing on confirmation of the Plan will commence on Aug. 9, 2018
at 11:00 a.m. Arizona time. The Confirmation Hearing may be
continued from time to time by the Court without further notice
other than adjournments announced in open court.
Any objections to confirmation of the Plan must be filed so that
they are received on or before August 2.
Prior to the hearing on the approval of the Disclosure Statement,
the Debtor filed an amended plan providing that Reorganized
Cornbread pays to JPMC $250,000 in Cash for application to the
principal owing under the Facility A Note as of the Effective Date
(anticipated to be $461,000). The Reorganized Cornbread will make
payable to JPMC the New JPMC Note A in the principal amount of
$211,000 (i.e., the portion of the Allowed JPMC Secured Claim
attributable to Facility A less the amount paid under Section
3.02.c(iv) of the Plan). The JPMC Note A bears interest at an
adjustable per annum interest rate of 1.0% plus JPMC's prime rate
in effect from time to time, for a term of one year. Reorganized
Cornbread pays principal based on a 15-year amortization period
plus accrued unpaid interest monthly, due on the first Business Day
of each month, beginning with the first complete month following
the Effective Date.
A full-text copy of the Amended Plan is available at:
http://bankrupt.com/misc/azb17-12877-199.pdf
A redlined version of the Amended Plan is available at:
http://bankrupt.com/misc/azb17-12877-200.pdf
About Cornbread Ventures
Cornbread Ventures, LP, is the owner and operator of Z'Tejas
Southwestern Grill. The company was founded in 2015 and is based
in Austin, Texas.
Cornbread Ventures filed a Chapter 11 petition (Bankr. D. Ariz.
Case No. 17-12877) on Oct. 30, 2017. In the petition signed by
Michael Stone, its president and general partner, the Debtor
estimated $1 million to $10 million in both assets and
liabilities.
Judge Brenda K. Martin presides over the case.
Serving as the Debtor's counsel is Jordan A Kroop, Esq., at Perkins
Coie LLP, as counsel. Horne LLP serves as its accountant.
The U.S. Trustee on Jan. 9, 2018, indicated that no official
committee of unsecured creditors is being appointed in the Chapter
11 case.
COSMEDX SCIENCE: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Cosmedx Science Inc.
fdba Earth Science, Inc.
475 N Sheridan St
Corona, CA 92880
Business Description: Cosmedx Science Inc. --
http://cosmedxscience.com-- is a full-
service cosmetic products manufacturer. The
Company specializes in anti-aging lotions,
creams, serums, AHA/BHA, stabilized vitamin
C, baby care products, bath & body products
such as body washes, shower gels, body
lotions, face masks, and body scrubs. The
Company also manufactures professional salon
products, natural sunscreens, hand
sanitizing gel, acne treatment products,
liquid supplements, amenities lines, scrubs,
masks, toners, facial cleansers, men's skin
care, pet care, and many more. Cosmedx
operates out of approximately 78,000 square
feet facility in Corona, California.
Chapter 11 Petition Date: July 19, 2018
Court: United States Bankruptcy Court
Central District of California (Riverside)
Case No.: 18-16043
Judge: Hon. Wayne E. Johnson
Debtor's Counsel: David B. Golubchik, Esq.
LEVENE, NEALE, BENDER, YOO & BRILL LLP
10250 Constellation Blvd Ste 1700
Los Angeles, CA 90067
Tel: 310-229-1234
E-mail: dbg@lnbyb.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Christopher Amato, president and CEO.
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/cacb18-16043.pdf
CREDITCORP: S&P Raises ICR to 'CCC+' Then Withdraws Rating
----------------------------------------------------------
S&P Global Ratings said it raised its issuer credit rating on
Creditcorp to 'CCC+' from 'CCC' after the company refinanced its
senior notes at par. S&P also removed the rating from CreditWatch,
where S&P placed it with developing implications on May 17, 2018.
The outlook is stable.
S&P subsequently withdrew the rating at the company's request.
D-M-B CORP: $1.3M Sale of Camden Property to 1828 Realty Approved
-----------------------------------------------------------------
Judge Andrew B. Altenburg, Jr. of the U.S. Bankruptcy Court for the
District of New Jersey authorized D-M-B Corp.'s sale of the real
property located at the northeast corner of Federal Street and 17th
Street, Camden, New Jersey, designated as Block 1185, Lot 1, and 2
South 18th Street, Camden, New Jersey, designated as Block 1199,
Lot 1, to 1828 Realty Associates, LLC for $1,250,000, subject to
adjustments.
The sale is free and clear of all liens and encumbrances
whatsoever, with said liens and encumbrances to attach to the
proceeds of sale.
At closing, the Debtor is authorized to pay from the proceeds of
sale funds necessary to satisfy all taxes due on the Property and
normal and customary closing costs and adjustments.
About D-M-B Corp
D-M-B Corporation, a lessor of real estate properties, owns in fee
simple interest a vacant commercial lot of approximately two acres
located at 1701 Federal Street, Camden, New Jersey, valued at
$600,000 (based on broker's opinion). The company also owns an
improved commercial lot with warehouse of approximately 6,000
square feet located at 2 S. 18th Street, Camden, New Jersey, valued
at $250,000 (based on broker's opinion).
D-M-B Corporation sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.N.J. Case No. 18-15485) on March 20,
2018.
In the petition signed by Michael DiMedio, president, the Debtor
disclosed $1.37 million in assets and $1.28 million in
liabilities.
Judge Andrew B. Altenburg Jr. presides over the case.
On April 27, 2018, the Court appointed Joseph A. Riggs, Jr., of
Berkshire Hathaway - Fox & Roach as realtor.
DANIEL BENYAMIN: $590K Sale of New York Condo Unit 5E Approved
--------------------------------------------------------------
Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern
District of New York authorized Daniel Benyamin and Lucy Benyamin's
private sale of the condominium apartment, Unit No. 5E in the
building known as The Renaissance East Condominium, located at 319
East l05th Street, New York, New York to Dong Xi Liu and Jasmine
Nishimura for $590,000.
The Debtor is authorized to employ BTR, effective, nunc pro tunc,
as of March 23, 2018, under the Exclusive Sales Agreement to
represent the Debtors in the within proceeding under Chapter 11 of
the Bankruptcy Code.
BTR will be compensated 5% of the sale price pursuant to the terms
of the Exclusive Sales Agreement, and is authorized to receive same
upon the closing of the sale of the Apartment.
Provided the Purchasers are in compliance with the conditions of
the contract of sale, the Debtors are directed to sell, transfer
and convey the Property to the Purchasers, free and clear of all
liens, claims and encumbrances and interests, with all such liens,
claims and encumbrances and interests to attach to the proceeds of
the sale, which proceeds will be held by Kornfeld & Associates,
P.C. in escrow in its IOLTA Account, located at JP Morgan Chase
Bank, NA, until further order of the Court.
Daniel Benyamin and Lucy Benyamin sought Chapter 11 protection
(Bankr. S.D.N.Y. Case No. 17-12677) on Sept. 25, 2017. They tapped
Randy M. Kornfeld, Esq., at Kornfeld & Associates, P.C. as counsel.
DITECH HOLDING: S&P Affirms 'CCC+' ICR, Outlook Stable
------------------------------------------------------
S&P Global Ratings said it affirmed its long-term issuer credit
rating on Ditech Holdings Corp. at 'CCC+'. The outlook remains
stable. However, we lowered our ratings on the senior secured term
loan to 'CCC+' from 'B-', reflecting lower recovery expectations.
The rating on the second-lien notes remains 'CCC-.'
Mortgage servicers have recently faced competition from banks'
growing presence in the market with significant advantages over
nonbank servicers. Moreover, as interest rates rise, S&P expects
mortgage origination to decline and margins to contract as
companies compete over declining supply.
Following its emergence from bankruptcy, Ditech is focused on
reducing its cost structure, which remains elevated across its
segments. Furthermore, the company is trying to grow its
origination presence by expanding product offerings and moving
toward more purchase origination (the company had historically been
focused on refinance). That said, there has been a significant
amount of turnover at the board and executive level. The board of
directors includes six new members and only three continuing
members. Tom Marano was appointed CEO in April, Jerry
Lombardo was appointed CFO in February, and Ritesh Chaturbedi was
appointed COO in April. Mr. Marano is Ditech's sixth CEO in about
three years. We are uncertain whether the company can execute its
evolving strategy.
On June 27, 2018, Ditech, through a press release, announced that
its board of directors has initiated a process to evaluate
strategic alternatives, which will include, among others, a sale of
the company, a business combination, or continuing as a stand-alone
entity. The company has engaged Houlihan Lokey as financial advisor
and Weil, Gotshal & Manges LLP as legal counsel to assist in the
review.
S&P views Ditech as highly leveraged despite the debt it discharged
in bankruptcy. During bankruptcy, the company was able to discharge
a little more than $800 million of debt. The previous senior
unsecured notes of $538.7 million and convertible notes of $242.2
million were canceled. The current corporate debt includes a senior
secured term loan of $1.073 billion and second-lien notes of $190.3
million. With $1.263 billion in corporate debt and approximately
$150 million in EBITDA, the company is leveraged approximately
8.4x.
The stable outlook reflects that Ditech can continue to operate for
the next 12 months with limited financial difficulty, although over
the long term the company's viability remains questionable. The
proposed strategic initiatives have no impact on the outlook given
that Ditech could remain a going-concern and the timing of any
action remains uncertain. In S&P's view, bankruptcy has afforded
Ditech additional time to implement a turnaround strategy, but the
company still depends on favorable business, financial, and
economic conditions to meet its obligations.
S&P said, "We could lower the rating over the next 12 months if
Ditech has difficulty maintaining its access to wholesale
financing. Although less likely, we could also lower the rating if
the company were to once again pursue a distressed debt exchange,
which we would likely view as tantamount to a default."
An upgrade is not likely in the foreseeable future.
S&P said, "Our simulated default scenario contemplates a default
occurring in 2020, most likely as a result of operational issues,
dwindling origination, and expenses exceeding servicing income. The
company's liquidity and capital resources become strained and the
company cannot operate without an equity infusion or bankruptcy."
S&P said, "We see asset sales as the most viable way to reduce
debt. We net mortgage assets against mortgage-related liabilities
prior to haircutting the assets." Key items to note from Ditech's
reorganization: 1) The company's revolver was eliminated in the
reorganization. 2) The term loan is senior compared with the
second-lien notes.
S&P sees operating challenges from:
-- Reduced new origination activity,
-- An increase in borrower delinquencies, and
-- A decline in gain-on-sale margin.
-- Net enterprise value (after 5% administrative costs): $631.2
million
-- Collateral value available to secured creditors: $631.2
million
-- Total first-lien debt: $997 million
--Recovery expectations: 60% (3)
-- Collateral value available to senior unsecured creditors: $0
million
-- Total second-priority debt: $261.3 million
--Recovery expectations: 0% Note: All debt amounts include six
months of prepetition interest.
DORIAN LPG: Confirms Receipt of Director Nominations from BW LPG
----------------------------------------------------------------
Dorian LPG Ltd. confirmed that BW LPG has submitted the names of
three director candidates to stand for election at Dorian's 2018
Annual General Meeting of Shareholders. Dorian has previously
received a revised unsolicited proposal from BW LPG to combine with
Dorian.
The Company's Board of Directors will review all of BW LPG's
actions and respond as appropriate in due course. Dorian
shareholders are not required to take any action at this time.
John Hadjipateras, Dorian Chairman and CEO, said: "The Company's
Board of Directors is currently comprised of extremely qualified,
experienced and dedicated directors, who are intensely focused on
shareholder value creation and the successful execution of Dorian's
strategy."
Evercore is serving as a financial advisor and Wachtell, Lipton,
Rosen & Katz and Seward & Kissel LLP are serving as legal advisors
to the Company.
About Dorian LPG
Dorian LPG -- http://www.dorianlpg.com/-- is a liquefied petroleum
gas shipping company and an owner and operator of modern very large
gas carriers ("VLGCs"). Dorian LPG's fleet currently consists of
twenty-two modern VLGCs. Dorian LPG has offices in Stamford,
Connecticut, USA, London, United Kingdom and Athens, Greece.
Dorian LPG reported a net loss of US$20.40 million on US$159.33
million of total revenues for the year ended March 31, 2018,
compared to a net loss of US$1.44 million on US$167.45 million of
total revenues for the year ended March 31, 2017. As of March 31,
2018, Dorian LPG had US$1.73 billion in total assets, US$776.69
million in total liabilities and US$959.41 million in total
shareholders' equity.
EAGLE REBAR: $6K Sale of 40-Foot Trailer to HD Supply Approved
--------------------------------------------------------------
Judge Katharine M. Samson of the U.S. Bankruptcy Court for the
Southern District of Mississippi authorized Eagle Rebar and Cable
Co., Inc., to sell a 40-foot trailer (VIN 16VGX4024D2687405)
outside the ordinary course of business to HD Supply/White Cap for
$6,000.
There are no valid liens, claims and security interests in, to or
upon the Equipment, with the exception of the secured claim
asserted by the Mississippi Department of Revenue ("MDOR"). In
order to resolve the objection of the MDOR, the parties have agreed
that the sales proceeds will be deposited into an interest bearing,
escrow account, under the control of counsel for the DIP and that
complies with the guidelines of the Office of the United States
Trustee for such accounts. The alleged secured claim of the MDOR
will attach to the sales proceeds in the account. The Debtor does
not agree that the claims of the MDOR are secured by the Equipment
or the sales proceeds, and that issue is reserved for a later
date.
The sale is free and clear of all liens, claims and interests, with
the alleged claims and interests of the MDOR to attach to the sales
proceeds.
The response filed by the UST is resolved by the agreement of the
parties that the sales proceeds will be placed in the interest
bearing, escrow account. The Debtor will report on any activity in
the interest bearing escrow account in its monthly operating
reports ("MORs"), and a bank statement for the interest bearing
escrow account will be filed with each of the Debtor's MORs.
Pursuant to Fed. R. Bankr. P. 6004(i)(l), within seven days after
the sale closes, the Debtor will file with the Court a Report of
Sale and attach a copy of the bill of sale.
The Order is a final judgment as contemplated by the applicable
Bankruptcy Rules.
About Eagle Rebar and Cable
Eagle Rebar and Cable Co., Inc., is a privately held steel erecting
company in Gulfport, Mississippi. Eagle Rebar and Cable filed a
Chapter 11 petition (Bankr. S.D. Miss. Case No. 18-50328) on Feb.
23, 2018, estimating $1 million to $10 million in assets and
liabilities. Billy R. Moore, director/vice president, signed the
petition. The case is assigned to Judge Katharine M. Samson.
Craig M. Geno, Esq., at Craig M. Geno, PPLC, is the Debtor's
counsel.
ELEMENTS BEHAVIORAL: U.S. Trustee to Name D. Crapo as PCO
---------------------------------------------------------
Judge Brenda L. Shannon of the U.S. Bankruptcy Court for the
District of Delaware issued a consent order directing the
appointment of a patient care ombudsman under Section 333 of the
Bankruptcy Code in the Chapter 11 cases of EBH Topco LLC and its
associated debtors.
The Debtors are "health care businesses" as defined by Section
101(27A). The U.S. Trustee and the Debtors agree that the
appointment of an ombudsman is appropriate in the Chapter 11 cases
and consent to the entry of an order directing the appointment of
an ombudsman.
The U.S. Trustee will appoint David N. Crapo to serve as PCO to
carry out the obligations set forth in Sections 333(b) and (c) in
the bankruptcy cases.
About Elements Behavioral Health
Long Beach, California-based EBH Topco, LLC along with its
subsidiaries -- http://www.elementsbehavioralhealth.com/-- are
providers of behavioral health services and residential drug and
alcohol addiction treatment. The Elements Behavioral Health(R)
family of programs offers comprehensive, innovative treatment for
substance abuse, sexual addiction, trauma, eating disorders, and
other mental health disorders.
EBH Topco, LLC (Lead Case), Elements Behavioral Health, Inc., and
certain of its affiliates sought Chapter 11 bankruptcy protection
on May 23, 2018 (Bankr. D. Del. Case No. 18-11214).
In the petition signed by CRO Martin McGahan, the Debtors estimated
$50 million to $100 million in assets and under $100 million to
$500 million in liabilities.
Hon. Brendan Linehan Shannon presides over the Debtors' cases.
Christopher A. Ward, Esq., Shanti M. Katona, Esq., Stephen J.
Astringer, Esq., and Jeremy R. Johnson, at Polsinelli PC, serve as
counsel to the Debtors. Alvarez & Marsal LLC acts as restructuring
advisor to the Debtors; Houlihan Lokey Capital, Inc., is the
investment banker; and Donlin, Recano & Company, Inc., is the
notice and claims agent.
The Debtors have requested procedural consolidation and joint
administration of the Chapter 11 cases.
Andrew Vara, acting U.S. trustee for Region 3, on June 11, 2018,
appointed five creditors to serve on the official committee of
unsecured creditors in the Chapter 11 cases.
EXPERT CAR: Aug. 23 Evidentiary Hearing on Disclosure Statement
---------------------------------------------------------------
Bankruptcy Judge Cynthia C. Jackson of the U.S. Bankruptcy Court
for the Middle District of Florida will conduct an evidentiary
hearing on August 23, 2018, at 2:45 P.M., to consider and rule on
the disclosure statement explaining Expert Car Care 3, L.L.C., and
Expert Car Care 3, L.L.C.'s reorganization plan.
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. They sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case Nos. 18-01439 and 18-01440)
on March 16, 2018. In the petitions signed by James Sada, managing
member, the Debtors each estimated assets of less than $1 million
and liabilities of $1 million to $10 million. Judge Cynthia C.
Jackson presides over the cases. BARTOLONE LAW, PLLC, led by
principal Aldo G Bartolone, Jr., Esq., serves as counsel to the
Debtors. No official committee of unsecured creditors has been
appointed in the Chapter 11 cases.
FAGERDALA USA - LOMPOC: Kleinberg Kaplan Comments on Court Ruling
-----------------------------------------------------------------
Matthew Gold, Esq., of Kleinberg Kaplan, commented that a recent
decision by the Ninth Circuit Court of Appeals, Pacific Western
Bank v. Fagerdala USA - Lompoc, Inc. (In re Fagerdala USA - Lompoc,
Inc.), strengthens the hand of creditors that seek to block
confirmation of a cramdown plan by purchasing other claims, and may
contribute to the liquidity of the market in bankruptcy debt. At
the same time, it highlights the uncertainty of confirmation
litigation.
Fagerdala involved a confirmation battle. The debtor's principal
assets were real estate. Pacific Western, the senior mortgage
holder, objected to the debtor's proposed plan of reorganization,
which would have extended the payment term and reduced the interest
rate on Pacific Western's loan. The plan was a cramdown plan,
designed to be confirmed over Pacific Western's objection. The vote
of the class of general unsecured creditors was crucial because the
Bankruptcy Code requires that at least one non-insider class of
creditors vote in favor of a cramdown plan. Pacific Western
purchased enough of the unsecured claims to block confirmation. {1}
The debtor responded by moving for the "designation" of Pacific
Western, which would invalidate the votes of the unsecured claims
purchased by Pacific Western.
The statutory basis for designation is section 1126(e) of the
Bankruptcy Code, which requires "good faith" (not statutorily
defined) for plan voting and for the solicitation of votes. The
bankruptcy court designated Pacific Western's votes because it
considered that the consequence of Pacific Western's claim
purchases and votes would be "highly prejudicial to the creditors
holding most of the unsecured debt." With Pacific Western's votes
designated the plan of reorganization was confirmed.
The bankruptcy court was affirmed by the district court, but
reversed by the Ninth Circuit. The court of appeals ruled that a
bad faith determination must be based on evidence of the claimant's
intent. The bankruptcy court did not base its decision upon any
consideration of Pacific Western's motives, focusing instead upon
the effect of the claims purchases upon other creditors.
The Ninth Circuit reasoned that "{D}oing something allowed by the
Bankruptcy Code and case law, without evidence of ulterior motive,
cannot be bad faith." As long as Pacific Western was doing
"something allowed" it was irrelevant that the effect of its
actions would hurt other creditors.
The opinion reviews what is considered to be allowed, and what is
not. Generally, a creditor can pursue its self-interest as a
creditor. Purchasing claims to defeat a plan to protect the value
of an existing claim is permitted. Purchasing claims to defeat a
plan in order to force a sale of assets of the debtor, or to injure
a competitor, is not permitted. Contrary to the bankruptcy court's
ruling, purchasing some claims without offering to purchase all
claims in a class is permitted.
One lesson of Fagerdala is that it is difficult to make
generalizations about the law concerning claim designation. The
opinion notes that "determining good faith {is} a "fluid" concept
and that 'no single factor' or 'single set of factors' {is}
conclusive." Thus, while Fagerdala is a victory for dissident
creditors and for claims traders, it does not provide bright line
certainty. One should expect that the case law in this area will
continue to develop.
Fagerdala provides an interesting contrast to last month's Supreme
Court decision in Lakeridge, in which the Court focused on the
extent to which appellate courts should be bound by factual
findings made by bankruptcy courts. Both cases involved
determinations of intent, but the Fagerdala opinion distinguished
Lakeridge because it found that the Fagerdala bankruptcy court had
applied the wrong legal standard. Because the Lakeridge opinion
was very narrow the Ninth Circuit was not limited by Lakeridge in
reaching the Fagerdala result.
Nor does it appear likely that the Supreme Court will be
considering claim designation issues in the near future. The
Fagerdala result is the polar opposite of the Second Circuit's 2011
decision in In re DBSD North America, Inc., which approved the
designation of a claim purchaser that acquired claims in order to
achieve a blocking position. Fagerdala carefully distinguished
DBSD, noting that in that case the claim purchaser sought the
"outside benefit" of advancing its strategic interests in the
industry, while Pacific Western was merely protecting the value of
a pre-existing claim. Thus the differences between the two
decisions do not appear to rise to the level of a circuit split
that would instigate Supreme Court review.
{1} Section 1126(c) requires for acceptance by a class of claims
there must be acceptance by 2/3 in amount and over 50% in number of
claims. Pacific Western purchased many small claims, and the
result was that over 50% in number was held by Pacific Western,
even though it held only approximately 10% in amount.
Based in Portland, Oregon, Fagerdala USA - Lompoc, Inc. filed for
chapter 11 bankruptcy (Bankr. D. Or. Case No. 14-34642) on August
14, 2014, with estimated assets at $1 million to $10 million and
estimated liabilities at $10 million to $50 million. The petition
was signed by Rex Hansen, president.
FC GLOBAL: Appoints Michael Stewart as CEO and CFO
--------------------------------------------------
The Board of Directors of FC Global Realty Incorporated has
appointed Michael R. Stewart to fill the positions of both chief
executive officer and chief financial Officer of the Company.
Mr. Stewart has served as a member of the Company's Board of
Directors since May 17, 2017. Mr. Stewart is a seasoned executive
with over 25 years of experience in C-level positions and 36 total
years of experience in executive management, operations and
finance. He brings a wealth of expertise with particular strength
in operations, financial management, strategy, M&A, capital raise,
FDA matters, medical reimbursement as well as sales, marketing,
product development and product launch. He has extensive U.S. and
International market expertise and has significant experience with
public company board and SEC matters. Currently, Mr. Stewart
operates as a private consultant to multiple companies, which he
started in late 2016. He is working with companies from private
start-up to mid-size public companies assisting them with major
negotiations, new product and company launches, merger and
acquisitions and capital raises. From 2014 through 2016, Mr.
Stewart served as president, chief executive officer and director
of publicly traded STRATA Skin Sciences, Inc. From 1990 to 2014,
Mr. Stewart held the positions of CEO, COO and CFO at two publicly
traded companies. In addition to his executive career and his
non-independent board positions, Mr. Stewart has served as an
independent public company director and as an advisor to the board
of several private companies. Mr. Stewart obtained both his MBA in
finance and his BS in accounting from LaSalle University in
Philadelphia.
On June 20, 2018, the Company entered into an employment agreement
with Mr. Stewart. The term of the Employment Agreement with Mr.
Stewart is for a period of one year and automatically renews for
additional one years period unless terminated by either the Company
or an Executive in writing by notice to such Executive or the
Company delivered no fewer than 90 days prior to expiration of the
then-applicable term. Under the Employment Agreement, Mr. Stewart
is entitled to a base salary of $400,000 per annum, payable in
accordance with the Company's normal payroll practices.
A full-text copy of the Employment Agreement is available at:
https://is.gd/dQsACH
Resignation of Officers
Effective June 16, 2018, Vineet P. Bedi resigned his position as
chief executive officer and president of the Company, as well as
president of the Company's subsidiaries.
Also effective June 16, 2018, Matthew Stolzar resigned his position
as chief financial officer and chief investment officer of the
Company and of the Company's subsidiaries.
Resignation of Director
Effective June 18, 2018, Robert Froehlich resigned as chairman and
a member of the Company's Board of Directors as well as from his
membership in the Board's Audit, Compensation and Nominations and
Corporate Governance Committees; he had served as chairman of the
Nominations and Corporate Governance Committee. In his resignation
letter, he stated that his disagreement with the delisting of the
Company's common securities from trading on the Nasdaq Common
Market; his disagreement with the board's approval to make an
employer matching contribution to the Company's 401(k) plan; and
his disagreement with the statements made by a board observer
concerning the behavior of the Company's former chief executive
officer with regard to a potential transaction involving the
Company.
Appointment of Directors
Effective June 18, 2018, Kristen E. Pigman was appointed by the
Board. As president of The Pigman Companies, LLC, Mr. Pigman
coordinates acquisition, planning, financing, development,
construction, and disposition of commercial real estate projects
for TPC, its partners, and institutional and corporate clients.
Before the creation of TPC in 1994, Mr. Pigman was a titled officer
and partner of The Koll Company of Newport Beach, CA. Prior to
joining Koll in 1989, Mr. Pigman was president of The Sandpiper
Companies, a real estate development firm headquartered in
Scottsdale, Arizona; and an executive with Coldwell Banker
Commercial Real Estate Group. He served as president for five
years of the Sacramento Valley Chapter of National Association of
Industrial and Office Properties and was a member of the National
Board of Directors of NAIOP and vice chairman for the NAIOP
National Office Development Forum. He also was vice president of
Development and a member of Board of Directors for the Sacramento
Area Commerce and Trade Organization, Chairman of the Building
Industry Association Commercial Developer's Council, and a member
of numerous other trade organizations and Chambers of Commerce. Mr.
Pigman has been and continues to be involved in a number of
charitable organizations, including The Comstock Club, Easter
Seals, the American Lung Association, the Police Athletic League,
the Leukemia Society, The Heart Foundation, the Principal for a Day
Program, and the Boy Scouts of America, having attained the rank of
Eagle Scout in that organization. Mr. Pigman graduated with honors
from The Mercersburg Academy in Mercersburg, PA, accepted an
English Speaking Union "Jr. Rhodes" Scholarship and took his 'A'
levels at The Truro School, Truro, Cornwall, UK, attended Rollins
College in Winter Park, FL on a baseball scholarship, and earned a
B.S. in Economics cum laude from The University of Maryland.
Effective June 20, 2018, Michael E. Singer was appointed by the
Board. Mr. Singer serves as executive vice chairman and chief
strategy officer at National Holdings Corporation. Previously, Mr.
Singer served as CEO and president of Ramius, a $13 billion (peak)
alternative investment advisory platform. As CEO of Ramius, Mr.
Singer directed strategy and execution of the firm's business plan.
Ramius partners with talented emerging alternative investment
teams providing them seed and working capital, institutional
infrastructure, proven sales and marketing and business guidance.
During his tenure, he created a salesforce which raised more than
$5 billion for the firm's investment teams and closed deals to
onboard to the platform five talented hedge fund teams including
Margate Capital. Mr. Singer was co-president of Ivy Asset
Management, a Fund of Hedge Funds business with over $15 billion in
assets. At Ivy, Mr. Singer established the firm's strategic plan
and ran the day-to-day activities. He began his career at Weiss,
Peck & Greer, a $17 billion asset management firm, where he spent
nine years and served as senior managing director and executive
committee member. He oversaw day-to-day operations, new product
development, client relationship management, hedge fund sales and
risk functions. Mr. Singer received a Bachelor of Science degree
in accounting with honors from Penn State University and a Juris
Doctorate from the Emory University School of Law. He is a CPA,
frequent contributor to Bloomberg TV Market Makers and author of
alternative industry white papers.
The newly appointed directors were appointed until their successors
are duly elected and qualified. They were nominated for
appointment to the Board by Opportunity Fund I, LLC, which is a
part to a Securities Purchase Agreement between OFI and the
Company.
About FC Global Realty
Formerly known as PhotoMedex, Inc., FC Global Realty Incorporated
(and its subsidiaries) founded in 1980, is transitioning from its
former business as a skin health company to a company focused on
real estate development and asset management, concentrating
primarily on investments in high quality income producing assets,
hotel and resort developments, residential developments and other
opportunistic commercial properties. The company is headquartered
in New York.
As of March 31, 2018, FC Global had $6.79 million in total assets,
$8.86 million in total liabilities, $5.03 million in redeemable
convertible preferred stock Series B and a total stockholders'
deficit of $7.10 million.
The report from the Company's independent accounting firm Fahn
Kanne & Co. Grant Thornton Israel, in Tel Aviv, Israel, on the
consolidated financial statements for the year ended Dec. 31, 2017,
includes an explanatory paragraph stating that the Company has
incurred net losses for each of the years ended Dec. 31, 2017 and
2016 and has not yet generated any revenues from real estate
activities. As of Dec. 31, 2017, there is an accumulated deficit
of $134.45 million. These conditions, along with other matters,
raise substantial doubt about the Company's ability to continue as
a going concern.
FC GLOBAL: Files SEC Form 25-NSE Delisting Notification
-------------------------------------------------------
The Nasdaq Stock Market LLC has filed with the Securities and
Exchange Commission a Form 25-NSE to report the removal from
listing or registration under Section 12(b) of the Securities
Exchange Act of 1934 of FC Global Realty Inc.'s common stock from
the Exchange.
About FC Global Realty
Formerly known as PhotoMedex, Inc., FC Global Realty Incorporated
(and its subsidiaries) founded in 1980, is transitioning from its
former business as a skin health company to a company focused on
real estate development and asset management, concentrating
primarily on investments in high quality income producing assets,
hotel and resort developments, residential developments and other
opportunistic commercial properties. The company is headquartered
in New York.
As of March 31, 2018, FC Global had $6.79 million in total assets,
$8.86 million in total liabilities, $5.03 million in redeemable
convertible preferred stock Series B and a total stockholders'
deficit of $7.10 million.
The report from the Company's independent accounting firm Fahn
Kanne & Co. Grant Thornton Israel, in Tel Aviv, Israel, on the
consolidated financial statements for the year ended Dec. 31, 2017,
includes an explanatory paragraph stating that the Company has
incurred net losses for each of the years ended Dec. 31, 2017 and
2016 and has not yet generated any revenues from real estate
activities. As of Dec. 31, 2017, there is an accumulated deficit
of $135,022,000. These conditions, along with other matters, raise
substantial doubt about the Company's ability to continue as a
going concern.
FIBRANT LLC: Sale of Surplus Assets to PCS Nitrogen Approved
------------------------------------------------------------
Judge Susan D. Barrett of the U.S. Bankruptcy Court for the
Southern District of Georgia, authorized the Purchase and Sale
Agreement, dated as of May 9, 2018, of Fibrant, LLC and its
affiliated debtors, with PCS Nitrogen Fertilizer, L.P. in
connection with the sale of their surplus assets with a value not
to exceed an aggregate total of $250,000 per sale transaction. The
sale is free and clear of all liens (other than the "permitted
exceptions") of any kind.
About Fibrant, LLC
Fibrant, LLC, headquartered in Augusta, Georgia, was previously a
producer and global supplier of chemical products and local
manufacturing services. At the end of September 2017, Fibrant
completed the shutdown and decommissioning of its caprolactam
manufacturing facility located at an industrial site at 1408
Columbia Nitrogen Drive, Augusta, Georgia 30901, other than the
portion of the facility that was (until recently) being used to
manufacture ammonium sulfate. In late 2017, Fibrant ceased
production of ammonium sulfate at the facility, and is now in the
process of administering the sale of, and shipping, all of the
remaining ammonium sulfate inventory. Once the inventory has been
sold and removed from the Site, Fibrant intends to decommission the
ammonium sulfate plant and all other operating assets and plant
infrastructure.
Fibrant, LLC and affiliates Fibrant South Center, LLC, Evergreen
Nylon Recycling, LLC and Georgia Monomers Company, LLC, sought
Chapter 11 protection (Bankr. S.D. Ga. Case Nos. 18-10274-77) on
Feb. 23, 2018. The case is assigned to Judge Susan D. Barrett.
The cases are jointly administered.
In the petition signed by David Leach, president and general
manager, Fibrant estimated assets and liabilities in the range of
$10 million to $50 million.
The Debtors tapped Paul K. Ferdinands, Esq., Jonathan W. Jordan,
Esq., Sarah L. Primrose, Esq., at King & Spalding LLP; and James C.
Overstreet Jr., Esq., at Klosinski Overstreet, LLP as counsel; and
Kurtzman Carson Consultants, LLC as their claims, noticing and
balloting agent.
FRANKLIN SQUARE: Moody's Assigns Ba1 CFR, Outlook Stable
--------------------------------------------------------
Moody's Investor Service has assigned a Ba1 Corporate Family Rating
and a Ba1-PD rating to Franklin Square Holdings, L.P. Moody's has
also assigned senior secured Ba1 Backed Revolving Credit Facility
and Backed Term Loan ratings to the $90 million 5-year Revolving
Credit Facility (RCF) and $450 million 7-year Term Loan B. The
rating outlook is stable.
The RCF and Term Loan B are obligations of the subsidiaries of FSH
listed and are joint and several. FSH is Guarantor of the RCF and
Term Loan B.
Proceeds from the Term Loan B shall be used to pay down the
existing $425 million Term Loan A and for general corporate
purposes, including the funding of seed capital.
Rating actions for Franklin Square Holdings, L.P.:
-- Corporate Family Rating -- Assigned at Ba1
-- Probability of Default Rating -- Assigned at Ba1-PD
-- Outlook is Stable
Rating actions for (1) FB Income Advisor, LLC, (2) FSIC II Advisor,
LLC, (3) FSIC III Advisor, LLC, (4) FSIC IV Advisor, LLC, (5) FSJV
Holdco, LLC, (6) FS Investment Advisor, LLC, (7) FS Global Advisor,
LLC, (8) FS Energy Advisor, LLC, (9) FS Fund Advisor, LLC, (10) FS
Real Estate Advisor, LLC, and (11) FS Credit Income Advisor, LLC,
collectively the Borrowers:
-- $90 million senior secured first lien Revolving Credit Facility
due 2023 -- Assigned at Ba1
-- $450 million senior secured first lien Term Loan B due 2025 --
Assigned at Ba1
RATING RATIONALE
The Ba1 CFR reflects FSH's strong recurring revenue base, moderate
leverage, healthy pre-tax income margins, and a leading competitive
position within the retail alternative investments market. A high
percentage of FSH's AUM is in permanent or semi-permanent capital
vehicles which supports a highly recurring management fee revenue
base.
Financial policy has historically been conservative. Prior to FSH
exiting its sub-advisory relationship with GSO Capital Partners in
April 2018, which resulted in a large termination fee obligation
that was partially funded with bank debt, FSH had been debt-free.
Leverage on a Moody's adjusted basis is in the Baa range at 2.5x
and Moody's would expect the company to maintain leverage below 3x.
These strengths, however, are constrained by FSH's relatively small
revenue scale and asset class concentration. While exhibiting solid
growth, revenue is lower than investment-grade peers. Product and
geographic diversification is also limited when compared to the
wider investment management industry, particularly investment grade
peers, as FSH is focused almost entirely on managing private
middle-market credit and its operations are entirely US-focused.
While the company is seekeing to expand its distribution channels,
distribution has historically been limited with a high degree of
concentration in the independent broker-dealer channel.
Over time, Moody's expects the company to consolidate certain of
its unlisted business development companies (BDCs) into its
flagship publicly traded BDC. In Moody's view, this would constrain
subsidiary revenue stream diversification, a negative from a
holding company creditor perspective.
Although the company plans to grow private credit AUM via its
partnerships with KKR Credit and EIG Global as well as grow its AUM
more broadly with other advisors focused on real estate, liquid
alternatives, and private equity, these partnerships are new and
the company's performance track record is nascent.
The stable outlook reflects Moody's view that FSH's management fees
will continue to steadily grow and leverage will moderately
decrease.
Moody's said factors that could lead to an upgrade or positive
outlook include: 1) Debt/EBITDA in the low 2x range on a consistent
basis; 2) strengthening of the core franchise through greater
geographic, product, and distribution diversification; 3) scale as
measured by revenues net of distribution and sub-advisory expense
beyond $750 million; and/or 4) seasoning of new investment
management partnerships and related track record.
Conversely, factors that could lead to a downgrade or negative
outlook include: 1) Debt/EBITDA sustained over 3x ; 2) pre-tax
income margins below 35% on a consistent basis; 3) a material
decline in the management fee rate; and/or 4) implementation of
fiduciary regulations that could curtail demand for the company's
higher-fee products.
The principal methodology used in these ratings was Asset Managers:
Traditional and Alternative published in December 2015.
FRANKLIN SQUARE: S&P Gives BB Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings said it assigned its 'BB' issuer credit rating
to Franklin Square Holdings L.P. (FSH). The outlook is stable. S&P
said, "At the same time, we also assigned our 'BB' issue-level
rating on the company's proposed $450 million first-lien term loan
and $90 million first-lien revolving credit facility. The recovery
rating on the first-lien facility is '3', reflecting our
expectation for a meaningful (50%) recovery in the event of a
payment default."
S&P said, "Our rating on FSH reflects the company's concentration
in direct lending, small (although growing) assets under management
(AUM) base, resilient management fees derived from permanent
capital vehicles, and relatively short track record in asset
management.
"The stable outlook reflects our expectation for leverage to remain
around 2.0x-2.5x during the next 12 months while EBITDA coverage
metrics remain above 7.0x. We would expect, under this scenario,
for the company to have high-single-digit percent growth in EBITDA
while investment performance remains above the benchmark for a
sizeable amount of the company's funds.
"We could lower the ratings if the company's investment performance
deteriorates and triggers a significant decrease in management and
incentive fees or if FSH issues further debt such that leverage
increases to 3.0x or above.
"We could raise the ratings in the next 12 months if the company
reduces leverage to levels comfortably below 2.0x on a sustained
basis. We could also raise the ratings if the company significantly
diversifies its AUM base while maintaining solid investment
performance."
GI CHILL: Moody's Assigns B3 CFR & Rates First Lien Term Loan B2
----------------------------------------------------------------
Moody's Investors Service assigned a B3 Corporate Family Rating
(CFR) to GI Chill Acquisition LLC (doing business as California
Cryobank Life Sciences) At the same time, Moody's assigned a B3-PD
Probability of Default Rating (PDR) and a B2 rating to the
company's new first lien senior secured term loan and revolver. The
rating outlook is stable.
Proceeds from the debt issuance, along with equity and a new second
lien term loan (not rated), will be used in part to fund the
acquisition and combination of California Cryobank and Cord Blood
Registry by private equity firm, GI Partners. Cord Blood Registry
is being acquired from AMAG Pharmaceuticals, Inc. (B2 stable) for
$530 million.
GI Chill Acquisition LLC:
Corporate Family Rating at B3
Probability of Default Rating at B3-PD
$40 million 1st lien secured revolver due 2023 at B2 (LGD3)
$410 million 1st lien secured term loan due 2025 at B2 (LGD3)
The rating outlook is stable.
RATINGS RATIONALE
GI Chill's B3 Corporate Family Rating reflects Moody's view that
the company will operate with high debt/EBITDA of more than 8.5
times on a GAAP basis (more than 6.5 times if adjusting for
deferred revenues related to pre-paid subscriptions) over the next
12-18 months. In addition, the company faces risks related to the
separation of the Cord Blood Registry business out of AMAG and
integrating it with California Cryobank. The combined company will
remain modest in overall size and have a high degree of earnings
concentration within the stem cell storage business.
The B3 is supported by good cash generation, high EBITDA margins,
and GI Chill's strong market positions in stem cell storage as well
as egg and sperm donor markets. GI Chill's stem cell storage
business, its largest segment, provides generally stable and
recurring revenue derived from annual storage fees. Moody's expects
earnings to grow over the next 12-18 months supported by increasing
volumes, price increases and cost synergies.
The B2 rating on the first lien secured term loan reflects its
first priority security on nearly all of the assets of the borrower
and guarantors, and loss absorption provided by the second lien
secured term loan.
GI Chill's liquidity is good supported by an undrawn $40 million
secured revolver as well as Moody's expectation for positive free
cash flow over the next 12-18 months, given low capital
expenditures and modest working capital needs. Free cash flow in
2020 will improve meaningfully once the company has completed the
carve-out from AMAG and integration of the two businesses The
revolver will benefit from a springing first lien leverage
covenant, but there will be no maintenance covenants on the term
loans. Moody's does not expect the company to draw on the revolver,
however there would likely be ample cushion under the covenant if
it did.
The stable outlook reflects Moody's view that GI Chill will
generate positive free cash flow but that debt/EBITDA will remain
high over the next 12-18 months. The stable outlook also reflects
Moody's expectation that the integration of both companies will not
cause material operating setbacks or disruptions.
The ratings could be downgraded if the company faces a
deterioration in operating performance, or is unable to generate
free cash flow. The ratings could be upgraded if the company can
successfully integrate both businesses and if free cash flow to
debt is expected to exceed 5% on an ongoing basis.
GI Chill Acquisition LLC is a leading provider of newborn stem cell
collection and storage as well as a leading egg and sperm bank in
the US. Combined revenue for the company will approximate $200
million.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
GI CHILL: S&P Assigns 'B-' Corporate Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings assigned its 'B-' corporate credit rating to GI
Chill Acquisition LLC. 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 first-lien
credit facility, which consists of a $40 million revolving credit
line due 2023 (undrawn at close) and a $410 million first-lien term
loan due 2025. The '3' recovery indicates our expectation for
meaningful (50%-70%; rounded estimate: 60%) recovery for the
first-lien debtholders in the event of default. We will not be
rating the second-lien term loan upon the company's request.
"The ratings on GI Chill reflect the company's limited size and
narrow business focus in the fragmented markets for cord blood and
tissue storage and for reproductive cell and tissue (both sperm and
egg), which are relatively small and have only moderate barriers to
entry. The ratings also reflect our view that currently there is
only a certain number of approved therapeutic applications for the
newborn cord blood and no approved uses for the cord tissue.
Partially offsetting these factors are the company's leading
positions in all of its target markets, above-average
profitability, potential cross-selling opportunities between the
two combined businesses, predictability of the annuity-like revenue
stream from the CBR business, and lack of exposure to government or
managed care reimbursement in either segment. The ratings also
reflect GI Chill's very high leverage following the transaction--at
9.2x in 2019, but projected to improve to 7.9x in 2020.
"The stable outlook reflects our expectation that GI Chill's
leverage will decrease to 7.9x in 2020 from 9.2x in 2019, once the
combined entity completes the integration process, realizes the
synergies, and the transaction/integration costs roll off. It also
reflects our expectation that the company will generate about $20
million in free operating cash flow in 2019, improving to over $30
million per year in 2020. At the same time, we expect leverage to
remain elevated above 7.5x for the next few years since we don't
expect the company to use internally generated cash flow for
permanent debt reduction. We project the financial sponsor will
shape the company's financial policy and use excess cash and
growing debt capacity to fund shareholder returns and
acquisitions."
GLOBALLOGIC HOLDINGS: Moody's Assigns B2 CFR, Outlook Stable
------------------------------------------------------------
Moody's Investors Service assigned GlobalLogic Holdings Inc.'s the
following ratings: B2 corporate family rating, B2-PD probability of
default rating and a B2 rating to the proposed first lien credit
facilities. The rating outlook is stable.
Partners Group has agreed to acquire an ownership stake in
GlobalLogic from Apax Partners, via a combination first lien debt,
equity and cash from the balance sheet. Upon completion, the
existing debt of the company will be repaid and Partners will be an
equal shareholder with existing investor Canada Pension Plan
Investment Board. The new credit facilities will also include a
first lien revolver and first lien delayed draw term loan B, which
both are expected to be unfunded at closing. However, Moody's
anticipates the DDTL will be fully drawn prior to expiring 9 months
from closing.
RATINGS RATIONALE
The B2 corporate family rating reflects GlobalLogic Holdings,
Inc.'s i) elevated leverage of about 5.8x (reflecting Moody's
standard adjustments and assuming the DDTLB is fully drawn) at PF
FYE March 31, 2018, ii) modest scale relative to larger and
financially stronger information technology ("IT") service and
outsourcing providers and iii) continued need for investment in
sales and marketing costs and new program ramps. The ratings are
supported by its expectation for strong double digit revenue and
EBITDA growth over the next two years, reflecting solid execution
by the company and favorable industry dynamics in which the
outsourced product development segment should outpace the overall
IT services market. GlobalLogic's long-standing relationships with
its blue chip customer base should provide a recurring base of
revenues. The high client retention rate reinforces the value of
lower cost R&D solutions in a functional area characterized by high
engineering costs.
Liquidity is good based on a cash balance of about $30 million and
an undrawn $75 million senior secured revolver at closing. Over the
next year Moody's expects free cash flow of about $25 million and
significant availability under the revolver. Moody's anticipates
adequate cushion under the financial covenants of the senior
secured revolver. The senior secured TLB and DDTLB will not have
financial covenants. The senior secured TLB and DDTLB (upon
drawing) are anticipated to amortize 1% per annum with a bullet due
at maturity.
The stable outlook reflects its expectation that GlobalLogic will
generate double digit revenue growth, EBITDA margins of about 20%
and free cash flow to debt of about 5% over the next 12 months.
Moody's also expects debt to EBITDA to improve to around 5x over
the next 12 months.
The ratings could be upgraded if GlobalLogic were to continue its
strong double digit revenue growth, generate free cash flow to debt
in the high single digits and improve adjusted debt to EBITDA to
below 4.5x on a sustained basis.
The ratings could experience downward rating pressure if
GlobalLogic's total revenue grows at a rate below that of the IT
services industry, liquidity deteriorates, there is a loss of a
couple of major customers or adjusted debt to EBITDA leverage ratio
exceeds 6x on a sustained basis.
The following ratings have been assigned:
Issuer: GlobalLogic Holdings Inc. (new)
Corporate Family Rating: - B2
Probability of Default Rating: - B2-PD
New First Lien Revolving Credit Facility -- B2 (LGD3)
New First Lien Term Loan B Credit Facility -- B2 (LGD3)
New First Lien Delayed Draw Term Loan B Credit Facility -- B2
(LGD3)
Outlook - Stable
The following ratings are expected to be withdrawn upon closing of
the new credit facilities:
Issuer: GlobalLogic Holdings Inc. (old)
Corporate Family Rating: - B2
Probability of Default Rating: - B2-PD
Existing First Lien Revolving Credit Facility -- B1 (LGD3)
Existing First Lien Term Loan B Credit Facility -- B1 (LGD3)
Outlook - Stable
GlobalLogic Holdings Inc. is a global outsourced provider of
product development services, with revenues of about $525.3 million
for FYE March 31, 2018. Upon completion of the pending acquisition
of an equity stake by Partners Group ("Partners"), the company will
be majority owned equally by Partners Group ("Partners") and Canada
Pension Plan Investment Board ("CPPIB").
GLOBALLOGIC HOLDINGS: S&P Assigns 'B+' CCR, Outlook Stable
----------------------------------------------------------
S&P Global Ratings assigned its 'B+' corporate credit rating to San
Jose, Calif.-based GlobalLogic Holdings Ltd. The outlook is
stable.
S&P said, "We also assigned our 'B+' issue-level rating and '3'
recovery rating to GlobalLogic Holdings Inc.'s proposed $600
million senior secured credit facilities, consisting of a $75
million revolving credit facility expiring 2023 and a $525 million
first-lien term loan due 2025. The '3' recovery rating indicates
our expectation of meaningful (50% to 70%; rounded estimate: 50%)
recovery in the event of a default."
The sale of Apax's 48% stake to Partners Group, and resulting debt
issuance, raises pro forma leverage approximately 1x from 4.1x for
the 12 months ended March 31, 2018. S&P said, "Though this
approaches the existing downside scenario of 5x, we expect the
company will continue to grow revenue while maintaining its
historical margins and conservative financial policy, and expect
leverage to decline throughout fiscal 2019 to the mid-4x area at
year-end. The $525 million first-lien term loan includes a $75
million delayed draw ($600 million total), available for nine
months post-closing and subject to a 5.5x first-lien net leverage
ratio, though we do not include this amount in our analysis. We may
look to revise the ratings and outlook depending on the usage of
this debt."
S&P said, "The stable outlook reflects our expectation for the
company to continue to grow revenue in the high-teens percentage
area, in line with current industry trends as companies look to
take advantage of the value proposition from outsourcing product
R&D, while maintaining current operating margins, such that
leverage remains below 5x.
"Although we are unlikely to do so over the next 12 months, we
could raise the rating if GlobalLogic is able to gain significant
scale and market share within the product engineering services
market through sustained growth, while diversifying its client base
and industry concentration, and reducing adjusted debt to EBITDA
below 4x on a sustained basis.
"We could consider a lower rating if significant customer
defections and decreased utilization rates lead to weakness in
revenue or profitability, or if the company pursues aggressive
leveraged dividends or acquisitions, resulting in adjusted debt to
EBITDA in excess of 5x or FOCF to debt below 5% on a sustained
basis."
HAMKOR ENTERPRISES: Unsecureds to be Paid Every 6 Mos. for 3 Years
------------------------------------------------------------------
Hamkor Enterprises, LLC, filed a disclosure statement in connection
with the solicitation of votes for its plan of reorganization.
The Debtor's Plan calls for payment of Class 2 through Class 4
claims in full as long-term debt obligations, albeit with
negotiated payment terms that differ from the pre-petition
contracts. The Debtor's Plan calls for pro rata payment to Class 5
unsecured creditors on a periodic basis. After Class 1 creditors
are paid in full, the Debtor will begin accumulating funds for
distribution to Class 5 creditors. Every six months, for a period
of three years thereafter, the Debtor will disburse a minimum of
$4,000 and a maximum of $6,000 on a pro rata basis to Class 5
creditors, depending on operations.
The Debtor's ownership will guarantee these payments, personally.
This will continue for a period of thirty-six months following
payment of Class 1 creditors, or until $30,000 is paid to Class 5
creditors, whichever comes first. In addition to the personal
guarantees offered by the Debtor's two members Mr. Frank Lee and
Mrs. Kaile Chen, to the extent that Frank Lee draws any salary or
other income from the reorganized Debtor, Mr. Lee will subordinate
his own income to meeting the Debtor's payment obligations to its
creditors under the Plan. Mr. Lee and Mrs. Chen will retain equity
ownership of the reorganized Debtor.
The Debtor's Plan contemplates continued operations with the
possibility of a sale of the business as a going concern under
conditions that produce the distributions called for under the
Plan.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/ganb18-53937-54.pdf
About Hamkor Enterprises
Hamkor Enterprises, LLC, is a business service located in
Lawrenceville, Georgia. The company opened its doors in 2015.
Hamkor Enterprises sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 18-53937) on March 6,
2018. In the petition signed by Frank Lee, member, the Debtor
estimated assets and liabilities of less than $500,000. Judge
Wendy L. Hagenau presides over the case. The Debtor hired Macey,
Wilensky & Hennings, LLP, as its legal counsel. No official
committee of unsecured creditors has been appointed in the Chapter
11 case.
HARLEM MARKET: Issues With Commercial Lease Delays Plan Filing
--------------------------------------------------------------
Harlem Market Inc. asks the U.S. Bankruptcy Court for the Southern
District of New York to extend the exclusive periods during which
only the Debtor is allowed to file a plan of reorganization and
solicit acceptance of the plan from July 17, 2018, and Sept. 14,
2018, respectively, through and including Oct. 15, 2018, and Dec.
13, 2018, respectively.
A hearing on the Debtor's request is scheduled for July 25, 2018,
at 10:00 a.m.
The purpose of the Chapter 11 filing on March 19, 2018, was to
afford the Debtor the protection of the automatic stay while it
attempts to deal with a cancellation provision in its commercial
lease dated April 13, 2015, with AK Properties Group LLC as
landlord, which has impeded the Debtor's efforts to sell its
supermarket and the Lease.
Specifically, the Lease includes a controversial cancellation
clause, which potentially permits the Landlord to cancel the Lease
on one year's notice subject to certain recapture rights in favor
of the Debtor. The scope and enforceability of this clause must be
clarified or adjudicated if the Debtor is to have any opportunity
to salvage fair market value for the supermarket.
The Debtor's efforts to negotiate a resolution of this issue have
so far been unsucessful. While the Debtor is continuing its
discussions with the Landlord, it is also prepared to file papers
to present the issue to the Court for determination.
In the meantime, however, the Debtor will not be ready to propose a
plan until the issue is finally resolved. Therefore, the Debtor
seeks an extension of the exclusivity periods, which otherwise
expire on July 17, 2018, and Sept. 14, 2018, respectively.
While the Debtor believes that it is unlikely that any other person
or party will seek to file a plan, maintaining an orderly process
is necessary, and the Debtor is concerned that the case could
become unsettled without an extension of both exclusive periods.
The Debtor submits that the relevant Adelphia factors favor the
Debtor's request for an extension of exclusivity. The Debtor is
continuing its efforts to resolve its issues with the Landlord
consensually, and is prepared to go forward with appropriate motion
practice if necessary. An extension of exclusivity is warranted to
maintain the status quo in the interim.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/nysb18-10754-21.pdf
About Harlem Market Inc.
Harlem Market Inc. operates a supermarket at 2005 Third Avenue, New
York, New York, under the "Met Food" banner pursuant to a
commercial lease dated April 13, 2015, with AK Properties Group LLC
as landlord.
Harlem Market sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 18-10754) on March 19, 2018. In the
petition signed by Peter Bivona, president, the Debtor disclosed
$1.36 million in assets and $3.42 million in liabilities. Kevin J.
Nash, Esq., at Goldberg Weprin Finkel Goldstein LLP serves as the
Debtor's bankruptcy counsel. Judge Michael E. Wiles presides over
the case.
HD SUPPLY: Moody's Hikes CFR & Sec. Term Loan Rating to Ba2
-----------------------------------------------------------
Moody's Investors Service upgraded HD Supply, Inc.'s Corporate
Family Rating to Ba2 from Ba3 and its Probability of Default Rating
to Ba2-PD from Ba3-PD. Moody's projects financial performance and
resulting key debt credit metrics improving over next 12 to 18
months, warranting higher ratings. In related rating actions,
Moody's upgraded the company's existing senior secured term loans
maturing 2021 and 2023 to Ba2 from Ba3, and senior unsecured notes
due 2024 to Ba3 from B2. Moody's also affirmed HD Supply's SGL-1
Speculative Grade Liquidity Rating. Rating outlook is stable.
The following ratings/assessments are affected by the action:
Upgrades:
Issuer: HD Supply, Inc.
Probability of Default Rating, Upgraded to Ba2-PD from Ba3-PD
Corporate Family Rating, Upgraded to Ba2 from Ba3
Senior Secured Bank Credit Facility, Upgraded to Ba2 (LGD3) from
Ba3 (LGD3)
Senior Unsecured Regular Bond/Debenture, Upgraded to Ba3 (LGD5)
from B2 (LGD5)
Outlook Actions:
Issuer: HD Supply, Inc.
Outlook, Remains Stable
Affirmations:
Issuer: HD Supply, Inc.
Speculative Grade Liquidity Rating, Affirmed SGL-1
RATINGS RATIONALE
HDS's Corporate Family Rating upgrade to Ba2 from Ba3 results from
its expectations of better credit metrics, due to combination of
growing revenues, beneficial operating leverage, strong margins and
conservative financial policy. Moody's projects revenues of about
$6.2 billion by late 2019, and resulting interest coverage,
measured as EBITA-to-interest expense, approaching 4.6x over its
time horizon versus 3.9x for last 12 months through April 29, 2018.
Overall, HD Supply's operating performance and resulting margins
are the highest among rated building products distributors and
represent the company's greatest credit strength. Moody's forecasts
debt-to-EBITDA declining to about 2.6x over next 12 to 18 months,
and free cash flow-to-debt approaching 15.5% over same time period
(all ratios includes Moody's standard adjustments). Moody's
estimates cash interest payments of approximating $120 million per
year, much lower relative to previous years, and major contributor
to free cash flow generation.
Positive trends in maintenance, repair and operation ("MRO"), and
US private construction support growth. Facilities Maintenance is
HDS's larger and more profitable business, representing about 56%
of total revenues, but the preponderance of operating income.
Relative constant demand for supplies and services needed to
maintain and upgrade multifamily, hospitality, healthcare and
institutional facilities is a source of stable earnings and
potential growth, as institutions increase operating budgets, and
multifamily vacancies decline. Fundamentals for domestic private
construction, the main driver of the company's Construction &
Industrial unit's earnings and resulting cash flows remain sound.
Construction & Industrial contributes approximately 44% of total
revenues. Its performance expectations for non-residential
construction consider trends in the American Institute of
Architects' Architectural Billings Index, or ABI, a key indicator
of expectations for construction projects amongst architects. The
ABI rose in May to 52.8 from 52.0 in April. Index readings over 50
indicate increasing billings, pointing to sustained growth. New
home construction, another source of earnings, is growing steadily.
Moody's projects total new housing starts could reach 1.27 million
in 2018, representing a 6% increase from about 1.20 million in
2017. Moody's maintains a positive outlook for the domestic
homebuilding industry.
However, risks remain. Capital deployment will be used for higher
levels of shareholder returns. From the June 3, 2017 initiation of
its 2017 share repurchase program, through April 29, 2018, HD
Supply has spent approximately $608 million for share repurchases,
capital that could otherwise be deployed towards reducing debt and
improving the company's balance sheet or enhancing liquidity. Also,
HD Supply operates in competitive markets and construction is very
cyclical, each creating longer-term uncertainty.
HD Supply's SGL-1 Speculative Grade Liquidity Rating reflects its
view the company will maintain a very good liquidity profile over
the next 12 months, generating free cash flow throughout the year.
HDS generates most of its free cash flow during its fiscal fourth
quarter. Cash on hand totaled $147 million at April 29, 2018, and
is more than sufficient to meet any shortfall in operating cash
flow, as well as support growth levels of working capital and
capital expenditures. Term loan amortization is manageable at $11
million per year. HDS has no significant maturities over the next
12 months.
Stable rating outlook reflects its expectations that HD Supply's
credit profile, such as leverage sustained below 4.0x, will remain
supportive of its Ba2 Corporate Family Rating over the next 12 to
18 months.
Positive rating actions over next 12 to 18 months are unlikely.
However, HD Supply's ratings could be upgraded over longer-term if
operating performance exceeds Moody's forecasts, with credit
metrics (ratios includes Moody's standard adjustments) and
characteristics such as:
» EBITA-to-interest expense sustained above 5.0x
» Debt-to-EBITDA remaining comfortably below 3.0x
» Operating margins staying above 10%
» Preservation of its very good liquidity profile
» Ongoing positive trends in key end markets
» Sustained organic growth
Negative rating actions could ensue if HDS's operating performance
falls below its expectation, resulting in metrics (all ratios
incorporate Moody's standard adjustments) or characteristics such
as:
» EBITA-to-interest expense remains below 3.5x
» Debt-to-EBITDA sustained above 4.0x
» Operating margins trending towards 7.5%
» Significant deterioration in liquidity profile
» Larger than anticipated share repurchases
» Sizeable debt-financed acquisitions
Upgrade of the senior secured term loans maturing 2021 and 2023 to
Ba2 from Ba3 results from higher Corporate Family Rating, primary
driver of debt instrument ratings per Moody's loss give default
methodology.
Two notch upgrade of the $1.0 billion senior unsecured notes due
2024 to Ba3 from B2 results from higher Corporate Family Rating as
well, reflecting higher expected recoveries due to strength of
HDS's fundamental performance and resulting debt credit metrics.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
HD Supply, Inc., headquartered in Atlanta, GA, is one of the
largest North American industrial distributors of products and
services for maintenance, repair and operations, and specialty
construction. Annualized revenues approximate $6.0 billion.
HGIM HOLDINGS: Davis Polk Advises Administrative Agent, Lenders
---------------------------------------------------------------
Davis Polk advised the administrative agent and worked with a
steering committee of lenders under a $1.2 billion prepetition
secured credit facility in the chapter 11 restructuring of HGIM
Holdings, LLC and certain of its affiliates, which do business as
Harvey Gulf. Davis Polk is also advising the administrative agent
with respect to the 5-year, $350 million term loan that prepetition
lenders received upon Harvey Gulf's exit from chapter 11.
In connection with Harvey Gulf's emergence from bankruptcy on July
2, 2018, the prepetition lenders received an overwhelming majority
of equity interests in reorganized Harvey Gulf, a 5-year $350
million take-back term loan, and control of the reorganized Harvey
Gulf's board of directors. Davis Polk played a pivotal role in
structuring, negotiating and defending Harvey Gulf's plan of
reorganization and in preparing the administrative agent and the
lenders for an expeditious emergence from bankruptcy.
Harvey Gulf is a provider of offshore supply vessels and marine
support services to support offshore oil and gas exploration and
production and is headquartered in New Orleans, Louisiana. Harvey
Gulf provides offshore production and drilling vessel support
services, including the transportation of supplies, equipment and
personnel to support drilling and production activities, offshore
construction, remotely operated underwater vehicles and subsea
support services and a variety of other specialized vessel
services.
The Davis Polk restructuring team includes partner Damian S.
Schaible and associates Angela M. Libby and Benjamin M. Schak. The
credit team includes partner Jinsoo H. Kim and associate Kwesi
Larbi-Siaw. The mergers and acquisitions team includes partners
William L. Taylor and Stephen Salmon and counsel Ajay B. Lele. The
executive compensation team includes counsel Ron M. Aizen. The tax
team includes partner William A. Curran. Members of the Davis Polk
team are based in the New York and Northern California offices.
About HGIM Holdings
Based in New Orleans, Louisiana, HGIM Holdings LLC --
http://www.harveygulf.com/-- is a marine transportation company
that specializes in providing offshore supply and multi-purpose
support vessels for deepwater operations in the U.S. Gulf of
Mexico. Harvey Gulf exclusively operates vessels qualified under
the U.S. cabotage laws known as the Shipping Act of 1916 and the
Merchant Marine Act of 1920, as amended. Harvey Gulf currently
employs 580 people. Harvey Gulf is headquartered in New Orleans,
Louisiana and maintains two corporate leases in Houston, Texas.
The Company and 90 of its affiliates filed for Chapter 11
protection (Bankr. S.D. Tex. Lead Case No. 18-31080) on March 7,
2018. The Debtors estimated assets and liabilities between $1
billion and $10 billion.
The Debtors hired Vinson & Elkins LLP as their counsel; Stephens,
Inc., as investment banker; Blank Rome LLP as special maritime
counsel; Postlethwaite & Netterville, APAC as accounting service
provider; and Prime Clerk LLC as the notice and claims agent.
HOG SNAPPERS: Delays Plan Filing, Wants North Palm Beach Asset Sale
-------------------------------------------------------------------
Hog Snappers Holdings, LLC, asks the U.S. Bankruptcy Court for the
Southern District of Florida to extend until Oct. 26, 2018, the
exclusivity period during which only the Debtor can file a plan of
reorganization and disclosure statement.
The exclusivity period within which the Debtor is required to file
its plan and disclosure statement is slated to expire on July 26,
2018.
The Debtor is currently trying to stabilize finances at the
Tequesta location, and has a pending motion to sell the lease and
other assets at the North Palm Beach location. The Debtor has
otherwise complied with all Chapter 11 reporting requirements and
no other creditor or interested party would be prejudiced by the
delay.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/flsb18-13646-89.pdf
About Hog Snappers Holdings
Hog Snappers Holdings, LLC, is a privately-held company in the
restaurants industry. Its principal assets are located at 713 US
Highway 1 North Palm Beach, Florida.
Hog Snappers Holdings sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-13646) on March 28,
2018. At the time of the filing, the Debtor estimated assets of
less than $500,000 and liabilities of $1 million to $10 million.
Judge Paul G. Hyman, Jr. presides over the case. Malinda L. Hayes,
Esq., at Markarian & Hayes serves as the Debtor's bankruptcy
counsel.
HORIZON GLOBAL: S&P Cuts 1st Lien Debt Rating to 'CCC' Amid Add-on
------------------------------------------------------------------
S&P Global Ratings lowered its issue-level rating on Horizon Global
Corp.'s first-lien debt to 'CCC' from 'CCC+' and revised the
recovery rating to '3' from '2'. The '3' recovery rating reflects
our expectation for meaningful recovery (50%-70%; rounded estimate:
55%) in the event of payment default. Horizon plans to issue a $50
million first-lien term loan add-on, which S&P expects it will use
to pay down its asset-based lending (ABL) revolving credit
facility. S&P also affirmed its 'CCC-' issue-level and '5' recovery
ratings on the company's convertible notes. The '5' recovery rating
reflects its expectation for modest recovery (10%-30%; rounded
estimate: 10%).
The proposed transaction does not affect S&P's 'CCC' corporate
credit rating on Horizon. S&P's corporate credit rating and all
issue-level ratings remain on CreditWatch developing.
RECOVERY ANALYSIS
Key analytical factors
S&P's simulated default scenario anticipates a default in 2019
because of operational issues in both North America and Europe that
lower margins significantly. This in turn causes negative free cash
flow for several quarters, with insufficient cash and availability
on the ABL to cover it.
S&P believes that if Horizon Global Corp. defaulted, it would still
have a viable business model due to its longstanding relationships
with several key customers. As a result, debtholders would achieve
the greatest recovery value through reorganization rather than
through liquidation.
Simulated default assumptions
-- LIBOR of 250 basis points at default
-- A 60% draw under the $99 million ABL revolver (not rated) at
default
-- Simulated year of default: 2019
-- EBITDA at emergence: $49.6 million
-- EBITDA multiple: 5x
Simplified waterfall
-- Net enterprise value (after 5% administrative costs): $236
million
-- Valuation split (obligors/nonobligors): 37%/63%
-- Priority claims: $54.6 million
-- Collateral value available to first-lien secured debt: $95
million
-- First-lien secured debt: $200 million
--Recovery expectations: 50%-70% (rounded estimate: 55%)
-- Total value available to unsecured claims: $33.7 million
-- Total unsecured claims: $234.6 million
--Recovery expectations: 10%-30% (rounded estimate: 10%)
RATINGS LIST
Horizon Global Corp.
Corporate Credit Rating CCC/Watch Dev/--
Ratings Lowered; Recovery Rating Revised
To From
Horizon Global Corp.
Senior Secured CCC/Watch Dev CCC+/Watch Dev
Recovery Rating 3(55%) 2(70%)
Ratings Affirmed; Recovery Expectations Revised
Horizon Global Corp.
Senior Unsecured CCC-/Watch Dev CCC-/Watch Dev
Recovery Rating 5(10%) 5(15%)
HOVENSA LLC: Judge Smock May Consider Evidence on Option 1 Claims
-----------------------------------------------------------------
Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District
of Virgin Islands addresses whether the Claims Procedures Order
entered by the Court on March 20, 2018, authorizes retired Judge
Henry Smock to consider evidence of the relative liability of the
Debtor to the Class 4 Tort Claimants who elect to have their claims
valued by him. Upon deliberation, the Court concludes that Judge
Smock should consider all evidence related to those claims,
including the Debtor's relative liability.
Pursuant to the Claims Procedures Order, Class 4 Claimants were
given two options. Under Option 1, claimants agreed to have their
claims against the estate valued by Judge Smock. Option 2 granted
immediate relief from the stay and the Plan injunctions to
Claimants who were then free to pursue the Debtor's insurance
carrier and any other parties who might be responsible for their
claims.
On May 25, 2018, certain Class 4 Tort Claimants represented by
Attorney Lee Rohn (the "Rohn Claimants") filed a motion for
enlargement of time to make the required election between Options 1
and 2. That motion was opposed by the Liquidating Trustee and
several other Class 4 Tort Claimants. A hearing was held on the
motion on June 14, 2018. After hearing argument, the Court granted
the extension request. During argument, however, a dispute arose
which the parties asked the Court to decide, namely whether Judge
Smock in valuing the Option 1 claims could consider evidence
related to the Debtor's relative culpability for the claimants’
injuries vis a vis other joint tortfeasors. The Rohn Claimants
asserted that Judge Smock may not do so, while the Liquidating
Trustee, AIG, and several other Tort 4 Claimants contended that he
may.
The Rohn Claimants assert that Judge Smock may not consider the
comparative negligence of the Debtor versus other responsible
parties because under Virgin Islands law only the jury can allocate
responsibility among joint tortfeasors. Therefore, the Rohn
Claimants assert that Judge Smock must determine the full value of
their Claims in the Option 1 process since the Debtor is jointly
and severally liable for that claim with the joint tortfeasors.
The other parties contend that Judge Smock is not being asked to
allocate responsibility among joint tortfeasors. Instead, he is
being tasked with valuing the claim of the Option l Claimants for
purposes of determining what distribution they should receive from
the estate (while retaining their right to pursue the other joint
tortfeasors). They contend that the valuation is a consensual
process performed in a summary fashion solely for purposes of
distribution under the Second Amended Plan of Liquidation. It is
not binding on anyone other than the Liquidating Trust and the
Claimant and is not usurping any role of a jury which may be asked
to allocate comparative negligence if the Claimant pursues the
other joint tortfeasors.
The Court agrees with the Liquidating Trustee and the other
claimants that under the Claims Procedures Order, Judge Smock is
authorized and should consider the relative responsibility that the
Debtor (vis a vis other tortfeasors) has with respect to the Option
1 claims being valued. The claims resolution process approved by
the Claims Procedures Order is a consensual process to liquidate
the tort claims solely for the purpose of a distribution from the
Liquidating Trust. In that regard it is akin to the settlement of
that claim. When considering whether to settle claims for which
others are jointly liable, parties typically do consider the
comparative negligence for that claim.
Further, the Claims Procedure Order deals only with the claim
against the estate and has no effect on the liability of any other
joint tortfeasor. If they elect Option l, the Rohn Claimants are
free to pursue the other joint tortfeasors and the jury is free to
allocate responsibility for the injury as it sees fit.
For these reasons, the Court concludes that Judge Smock may and
should consider all relevant information about the Option 1 claims,
including the Debtor's relative responsibility for those claims.
A full-text copy of the Court's June 26, 2018 Memorandum Opinion
is available at:
http://bankrupt.com/misc/vib1-15-10003-1111.pdf
About Hovensa
Hovensa, L.L.C., produces and markets refined petroleum products.
The Company offers gasoline, diesel, home heating oil, jet fuel,
kerosene, and residual fuel oil. Hovensa serves customers
throughout North America.
Hovensa L.L.C. filed a Chapter 11 bankruptcy petition in the U.S.
Bankruptcy Court for the District of the Virgin Islands (Bankr. D.
V.I. Case No. 15-10003) on Sept. 15, 2015. The petition was signed
by Sloan Schoyer as authorized signatory. The Debtor has estimated
assets of $100 million to $500 million, and liabilities of more
than $1 billion.
Judge Mary F. Walrath is assigned to the case. The Law Offices of
Richard H. Dollison, P.C., serves as the Debtor's counsel. Prime
Clerk LLC is the Debtor's claims and noticing agent. Alvarez &
Marsal North America, LLC to provide Thomas E. Hill as chief
restructuring officer, effective Sept. 15, 2015 petition date.
The U.S. Trustee appointed five creditors to serve on the committee
of creditors holding unsecured claims.
* * *
The effective date of Hovensa LLC's Chapter 11 plan occurred on
Feb. 17, 2016, and the official committee of unsecured creditors
was dissolved.
IBEX LLC: To Pay Unsecured Creditors from Net Profit Funds
----------------------------------------------------------
Ibex, LLC, filed with the U.S. Bankruptcy Court for the District of
Colorado a disclosure statement describing its plan of
reorganization dated June 29, 2018.
Class 4 under the plan is comprised of creditors holding Allowed
Unsecured Claims against the Debtor, including any allowed penalty
Claims held by any taxing authority which are not related to actual
pecuniary loss. Allowed Class 4 Claims will receive their pro rata
share of the Net Profits Fund. Distributions from the Net Profits
Fund will continue for 5 years following the Effective Date.
Distributions to Class 4 claimants will not exceed the amount of
the Allowed Unsecured Claims plus interest calculated at 2.5% per
annum. Distributions to the Allowed Class 4 claimants will be made
annually on each anniversary of the Effective Date. In the
alternative, at any time during the term of the Plan and at its
sole discretion, the Debtor may distribute $200,000 less any
payments already made under the Plan, as a lump-sum payment to the
allowed Class 4 claimants on a pro-rata basis, in full, final, and
complete satisfaction of their unsecured claims.
Payments and distributions under the Plan will be funded by a
post-petition debtor in possession loan, Litigation Proceeds, and
Debtor's operations.
The Debtor has reduced expenses and streamlined operations. The
Debtor anticipates that its business performance will increase as a
result of the infusion of cash from the debtor-in-possession loan
and increased marketing efforts.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/cob17-16031-244.pdf
About Ibex, LLC
Ibex, LLC -- http://www.rightathome.net/colorado-springs-- is a
locally owned and operated franchise office of Right at Home Inc.,
a senior home care and staffing company providing care since 1995.
The Company's mission is to improve the quality of life for those
it serves by providing high quality in-home caregivers. The
Company provides Alzheimer's care, companionship, physical
assistance and respite care services.
Ibex, LLC, based in Colorado Springs, CO, filed a Chapter 11
petition (Bankr. D. Colo. Case No. 17-16031) on June 29, 2017. In
the petition signed by Peter Vanderbrouk, managing member, the
Debtor disclosed $111,012 in assets and $3.44 million in
liabilities.
The Hon. Elizabeth E. Brown presides over the case.
David J. Warner, Esq., at Wadsworth Warner Conrardy, P.C., serves
as bankruptcy counsel to the Debtor. Jensen Dulaney LLC is the
Debtor's special counsel. BiggsKofford, LLC as accountant.
INTREPID AVIATION: Fitch Affirms 'BB-' LT IDR, Outlook Stable
-------------------------------------------------------------
Fitch Ratings has affirmed Intrepid Aviation Group Holdings, LLC's
Long-term Issuer Default Rating (IDR) at 'BB-' and senior unsecured
notes rating at 'B+'. The Rating Outlook is Stable.
These actions are being taken in conjunction with a broader
aircraft leasing industry peer review conducted by Fitch, which
includes 10 publicly rated firms.
KEY RATING DRIVERS - IDRs and Senior Debt
The rating affirmation reflects Intrepid's solid cash flows, as
evidenced by strong contractual lease revenue, well-defined
business model of owning and leasing predominantly young, widebody
aircraft and access to multiple sources of capital.
Rating constraints include Intrepid's secured funding profile,
relatively short track record, smaller and less liquid fleet when
compared with other aircraft lessors focused on more broadly
utilized/traded narrowbody aircraft and private equity ownership,
which results in elevated balance sheet leverage and weaker
corporate governance when compared to public peers.
Rating constraints applicable to the aircraft leasing industry more
broadly include the monoline nature of the business, vulnerability
to exogenous shocks, reliance on wholesale funding sources, and
increased competition.
As of March 31, 2018, Intrepid's owned and ordered fleet consisted
of 30 Boeing and Airbus aircraft that are predominantly widebodies,
including A330-200, A330-300, B777-300ER and B787-8 aircraft. The
firm also owns one narrowbody and two B747-8F freighters. The
weighted average age of the portfolio was 3.8 years as of March 31,
2018, which compares favorably to other aircraft lessors. The
aircraft portfolio had a net book value of $3.1 billion as of March
31, 2018 and is somewhat concentrated by airline, as Intrepid had
only 13 customers in 11 countries. Top lessees at March 31, 2018
were Turkish Airlines (22% of net book value), Philippine Airlines
(18%), AirBridgeCargo Airlines (11%), Air France (7%), and Sichuan
Airlines (6%).
There was no rating impact following the announcement that
Intrepid's shareholders, which include funds managed by
Centerbridge Partners, L.P. (Centerbridge) and Reservoir Capital
Group, L.L.C. (Reservoir), entered into a partnership with Amedeo
Capital Limited, an aircraft asset manager focused on widebody
commercial aircraft.
Under the new partnership, Amedeo acquired Intrepid's U.S.-based
management company and will purchase a minority stake in Intrepid,
joining Centerbridge and Reservoir as shareholders. Fitch believes
this announcement enhances Intrepid's scale on an owned and managed
basis and provides the potential for improved operating
efficiencies for both firms.
Intrepid had $3.4 billion in total assets at March 31, 2018 but the
combined platform will manage approximately $8 billion in aircraft
assets. Greater scale should improve Intrepid's purchasing power,
broaden its airline customer relationships, and solidify Intrepid's
competitive position in the widebody market. Nevertheless,
Intrepid's standalone credit profile is not expected to change
materially. The Intrepid-Amedeo structure is similar to that of Fly
Leasing Limited, whose portfolio is managed and serviced by BBAM
Limited Partnership, whereby the majority of Intrepid's earnings
will be generated from operating lease revenue, offset by
management/servicing fees paid to Amedeo.
Intrepid has an improving track record of obtaining debt financing
from the commercial bank market and other financing sources, in
addition to receiving equity contributions from its Centerbridge
and Reservoir. Notable transactions in 2017 included the issuance
of $277.8 million of institutional secured term loans backed by the
Aircraft Finance Insurance Consortium (AFIC) and $47.3 million of
capital contributions via the issuance of preferred equity
interests to its sponsors.
Intrepid established access to the unsecured bond market in 2014
and 2015, issuing an aggregate of $635 million of notes, but the
firm has not issued unsecured bonds since that time. At Dec. 31,
2017, unsecured debt represented 19.7% of total debt funding, which
was within Fitch's 'bb' quantitative benchmark range for balance
sheet-intensive finance and leasing companies. Still, the company
has no unencumbered assets, which Fitch believes limits financial
and operational flexibility.
The rating is supported by Intrepid's long-dated contracted lease
stream. Total contracted revenue as of March 31, 2018 was
approximately $2.2 billion, which represented approximately 87.4%
of total debt, and provides a solid source of debt repayment absent
lessee credit events.
Lease yields have recovered since the bankruptcy of one of
Intrepid's previous lessees, Skymark Airlines Inc., in 2015, which
brought average lease yields down to 8.8% due to lost revenue from
seven A330-300 aircraft. The subsequent re-leasing of seven A330s
to Turkish Airlines has resulted in lease yields of around 10%-11%,
a level that is expected to be maintained over the outlook
horizon.
As of March 31, 2018, the company's weighted average remaining
lease term was 7.9 years, which is one of the longest dated lease
streams among aircraft lessors and protects against unforeseen
volatility in lease rates. Nevertheless, Fitch notes that
Intrepid's weighted average remaining lease term is longer than the
weighted average debt maturity of 5.2 years at March 31, 2018,
which introduces spread compression risk as interest rates
increase. This risk is mitigated by the terms of the company's
fixed-rate secured credit facilities and long-term variable-rate
secured credit facilities, which have corresponding interest rate
swaps, generally match the length of the leases.
Cash on hand ($50.0 million) and cash flow from operations (which
totaled $168.1 million in 2017) over the next 12 months should
adequately debt maturities and amortization through the remainder
of 2018, which totaled $185.9 million at March 31, 2018. However,
the firm has $515 million of 6.875% senior unsecured notes maturing
in February 2019, which Fitch expects will be refinanced with
unsecured debt. Fitch expects that Intrepid will continue to
primarily fund its business with secured credit facilities.
Intrepid's leverage, measured as debt to tangible equity, was 4.4x
as of March 31, 2018, down from 4.7x as of Dec. 31, 2017 and 4.9x
as of Dec. 31, 2016. Fitch anticipates that leverage will approach
4.0x over the outlook horizon, driven primarily by equity built
through retained earnings, but will remain among the highest among
the aircraft lessor peer group.
The senior secured debt ratings are equalized with Intrepid's IDR
given the heavily secured funding profile and reflects average
recovery prospects under a stress scenario. The senior unsecured
debt rating is one notch below Intrepid's IDR given the
subordination of these obligations, the lack of an unencumbered
asset pool, and below average recovery prospects under a stress
scenario.
The Stable Outlook reflects stabilization in the widebody aircraft
market, as declines in market values and lease rates have moderated
and Intrepid has recently sold widebodies at gains. Additionally,
Fitch's concerns about the credit profiles of certain Intrepid
lessees have also diminished, as the company maintained a 100%
utilization rate as of March 31, 2018. Alitalia (5.5% of 1Q18 lease
revenue) continues to operate two Airbus A330-200 aircraft on lease
from Intrepid and remains current on all lease payments. Alitalia
is an Italian airline that filed a petition for admission to
Extraordinary Administration proceedings in the Italian Bankruptcy
Court in May 2017.
RATING SENSITIVITIES - IDRs and Senior Debt
The ratings could be positively influenced by enhanced scale and
lessee diversification at Intrepid, provided such actions are
undertaken at a moderate pace and do not adversely affect
underwriting or pricing terms. Increased unsecured debt levels,
reduced leverage, sustained improvements in profitability, and
continued demonstration of fleet management would also be viewed
favorably.
Intrepid's ratings could be negatively affected by the following:
credit deterioration of underlying lessees, particularly those
which represent a meaningful portion of Intrepid's portfolio, a
significant increase in leverage levels, rapid expansion that is
not accompanied by consistent underwriting standards and
commensurate growth in capital levels and staffing, outsized
impairment charges or an inability to successfully navigate market
downturns.
The ratings of the senior secured debt are primarily sensitive to
changes in Intrepid's IDR and secondarily to the relative recovery
prospects of the instruments.
The ratings of the unsecured debt are primarily sensitive to
changes in Intrepid's IDR. A meaningful increase in the proportion
of unsecured funding and the creation of an unencumbered asset
pool, which results in a meaningful improvement in recovery
prospects for unsecured creditors, could result in an upgrade of
the unsecured debt rating.
Fitch has affirmed the following ratings:
Intrepid Aviation Group Holdings, LLC
-- Long-term IDR at 'BB-';
-- Senior unsecured notes at 'B+'.
Intrepid Finance Co.
-- Long-term IDR at 'BB-';
-- Senior unsecured notes at 'B+'.
A330 MSN 1451 Limited
A330 MSN 1466 Limited
A330 MSN 1483 Limited
A330 MSN 1542 Limited
A330 MSN 1552 Limited
A330 MSN 1579 Limited
A330 MSN 1602 Limited
Aircraft MSN 41520 Limited
Cayenne Aviation MSN 1123 Limited
Cayenne Aviation MSN 1135 Limited
Intrepid Aviation Blue Limited
Intrepid Aviation Luxembourg Borrower 1 S.A.R.L.
Intrepid Aviation Luxembourg Borrower II S.A.R.L.
Macan Aviation 1 Limited
Macan Aviation 2 Limited
Pajun Aviation Leasing 3 Limited
Panamera Aviation Leasing Limited
Panamera Aviation Leasing IV Limited
Panamera Aviation Leasing V Limited
Panamera Aviation Leasing VI Limited
Panamera Aviation Leasing VII Limited
Panamera Aviation Leasing XII DAC
Panamera Aviation Leasing XIII DAC
-- Senior secured debt at 'BB-'.
The Rating Outlook is Stable.
LAKE BRANCH: Case Summary & 5 Unsecured Creditors
-------------------------------------------------
Debtor: Lake Branch Dairy, Inc.
3060 Perdue Road NE
Wauchula, FL 33873-8503
Business Description: Lake Branch Dairy, Inc. is a privately held
company in Wauchula, Florida that operates
in the dairy farm industry.
Chapter 11 Petition Date: July 19, 2018
Court: United States Bankruptcy Court
Middle District of Florida (Tampa)
Case No.: 18-05951
Debtor's Counsel: Buddy D. Ford, Esq.
BUDDY D. FORD, P.A.
9301 West Hillsborough Avenue
Tampa, FL 33615-3008
Tel: 813-877-4669
Fax: 813-877-5543
E-mail: Buddy@TampaEsq.com
All@tampaesq.com
Total Assets: $3,331,161
Total Liabilities: $7,906,868
The petition was signed by Roger L. Nickerson, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's five unsecured creditors is available for free
at:
http://bankrupt.com/misc/flmb18-05951.pdf
LEGAL COVERAGE: Trustee's $3.2M Sale of Philadelphia Penthouse OK'd
-------------------------------------------------------------------
Judge Jean K. FitzSimon of the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania authorized Leslie Beth Baskin, the
Chapter 11 Trustee for The Legal Coverage Group Ltd., to sell the
condominium unit located at 101 Walnut Street, Unit 11,
Philadelphia, Pennsylvania, including all personal property located
thereon, to Harry Potter, LLC, for $3.2 million.
The sale is free and clear of all liens, claims, interests, and
encumbrances, excluding only those liens, claims, interests, and
encumbrances expressly permitted to remain on the Property pursuant
to the Agreement, if any.
The proceeds of the Sale will be used to pay the normal and
customary costs associated with a sale, including but not limited
to condominium fees and costs, real estate taxes and the Lease
Termination Payment.
The Trustee will request a resale certification from 101 Walnut
Condominium Association stating the amount of condominium
assessments due for the Penthouse Unit and will cause all
Assessments due as of the date of the closing to be paid to the
Association from the proceeds at closing.
All existing, valid and unavoidable Liens in the Property will
attach to the proceeds of the Sale.
About The Legal Coverage Group
The Legal Coverage Group Ltd., also known as LCG, Ltd., is a
Pennsylvania Subchapter S corporation. LCG, the exclusive provider
of HELP Legal Plan, was founded in 1995 to modernize and ultimately
perfect the concept of the employee legal plan. Headquartered in
the suburbs of Philadelphia, Pennsylvania, HELP is a privately-held
employee legal plan servicing worksites of all sizes and industries
on a regional and national level, while maintaining the industry's
highest rates of retention through unparalleled, unlimited, and
fully comprehensive benefits services provided by only partner
level attorneys.
Legal Coverage Group sought protection under Chapter 11 of the
Bankruptcy Code
(Bankr. E.D. Pa. Case No. 18-10494) on Jan. 26, 2018. In the
petition signed by CEO Gary A. Frank, the Debtor estimated assets
of $100 million to $500 million and liabilities of $10 million to
$50 million.
Judge Jean K. FitzSimon presides over the case.
Dilworth Paxson LLP is the Debtor's legal counsel; and Wipfli LLP,
as tax advisor.
Leslie Beth Baskin, Esq., has been appointed as Chapter 11 Trustee,
and is represented by the law firm of Spector Gadon & Rosen, PC.
LEGAL COVERAGE: Trustee's $965K Sale of Philadelphia Property OK'd
------------------------------------------------------------------
Judge Jean K. FitzSimon of the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania authorized Leslie Beth Baskin, the
Chapter 11 Trustee for The Legal Coverage Group Ltd., to sell the
real property located at 101 Walnut Street, Unit 8, Philadelphia,
Pennsylvania, including all personal property located in the
Agreement of Sale, to Jon Liss for $965,000.
The sale is free and clear of all liens, claims, interests, and
encumbrances, excluding only those liens, claims, interests, and
encumbrances expressly permitted to remain on the Property pursuant
to the Agreement, if any.
The proceeds of the Sale will be used to pay the normal and
customary costs associated with a sale, including but not limited
to condominium fees and costs, real estate taxes and the Lease
Termination Payment.
The Trustee will request a resale certificate from 101 Walnut
Condominium Association stating the amount of condominium
assessments due for Unit 8 and will cause all Assessments due as of
the date of the closing to be paid to the Association from the
proceeds at closing.
All existing, valid and unavoidable Liens in the Property will
attach to the proceeds of the Sale.
Notwithstanding Bankruptcy Rules 6004(h) and 6006(d), the Order
will not be stayed after the entry hereof but will be effective and
enforceable immediately upon entry, and the stay provided in such
rules is hereby expressly waived and will not apply. Any party
objecting to the Order must exercise due diligence in filing an
appeal and pursuing a stay within the time prescribed by law and
prior to the consummation of the Sale or risk its appeal being
foreclosed as moot.
About The Legal Coverage Group
The Legal Coverage Group Ltd., also known as LCG, Ltd., is a
Pennsylvania Subchapter S corporation. LCG, the exclusive provider
of HELP Legal Plan, was founded in 1995 to modernize and ultimately
perfect the concept of the employee legal plan. Headquartered in
the suburbs of Philadelphia, Pennsylvania, HELP is a privately-held
employee legal plan servicing worksites of all sizes and industries
on a regional and national level, while maintaining the industry's
highest rates of retention through unparalleled, unlimited, and
fully comprehensive benefits services provided by only partner
level attorneys.
Legal Coverage Group sought protection under Chapter 11 of the
Bankruptcy Code
(Bankr. E.D. Pa. Case No. 18-10494) on Jan. 26, 2018. In the
petition signed by CEO Gary A. Frank, the Debtor estimated assets
of $100 million to $500 million and liabilities of $10 million to
$50 million.
Judge Jean K. FitzSimon presides over the case.
Dilworth Paxson LLP is the Debtor's legal counsel; and Wipfli LLP,
as tax advisor.
Leslie Beth Baskin, Esq., has been appointed as Chapter 11 Trustee,
and is represented by the law firm of Spector Gadon & Rosen, PC.
LENEXA HOTEL: Court Tosses HHF Bid for Stay Pending Appeal
----------------------------------------------------------
Bankruptcy Judge Dale L. Somers denied Holiday Hospitality
Franchising, LLC's motion for a stay pending appeal of the Court's
granting of Debtor Lenexa Hotel, L.P.'s motion to dismiss and
denying Holiday Hospitality's motion to convert the chapter 11 case
captioned In re: LENEXA HOTEL, L.P., Chapter 11, Debtor, Case No.
16-22172 (Bankr. D. Kan.) to chapter 7.
After having carefully considered the parties' oral arguments, the
briefs, and the record in this case, the Court made its oral ruling
denying the Motion during a telephonic hearing held on June 25,
2018. The Court concluded that Holiday Hospitality has failed to
show that the issuance of a stay would be in the public interest,
that it has a likelihood of success on the merits, and that a stay
would not cause harm to CoreFirst Bank & Trust.
A full-text copy of the Court's Memorandum Opinion and Judgment
dated June 25, 2018 is available at https://bit.ly/2mfMWrS from
Leagle.com.
Lenexa Hotel, L.P., Debtor, represented by Carl R. Clark , Lentz
Clark Deines PA,Jeffrey A. Deines, Lentz Clark Deines PA & Brennan
P. Fagan -- bfagan@fed-firm.com -- Fagan Emert & Davis, LLC.
U.S. Trustee, U.S. Trustee, represented by Christopher T. Borniger,
Office of the United States Trustee & Jordan M. Sickman, Office of
U.S. Trustee.
About Lenexa Hotel
Lenexa Hotel owns and operates a hotel at 12601 West 95th Street,
Lenexa, Kansas 66215. It is a Kansas limited partnership that was
originally formed in 1982. After formation, Lenexa acquired the
Hotel, which had been operating at the site since construction in
1971. The hotel has operated under various brands throughout its
history, and currently operates under a franchise agreement with
Holiday Hospitality Franchising, Inc., under the Crowne Plaza
brand.
Lenexa Hotel filed a Chapter 11 bankruptcy petition (Bankr. D. Kan.
Case No. 16-22172) on Nov. 1, 2016. In its petition, the Debtor
estimated $1 million to $10 million in assets and $10 million to
$50 million in liabilities. The petition was signed by Stephen J.
Craig, president.
Lentz Clark Deines PA represents the Debtor as counsel. Brennan
Fagan and Fagan Emert & Davis, LLC, and the Skepnek Law Firm have
been tapped as special counsel. Michele C. Hammann, SS&C
Solutions, Inc, and Summers, Spencer & Company, P.A., serve as
accountants.
LH ANESTHESIA: Must Show Cause Regarding Ombudsman Appointment
--------------------------------------------------------------
Pursuant to 11 U.S.C. Section 333(a)(1), the Court will order the
appointment of a patient care ombudsman within thirty (30) days
after the commencement of the case, unless the Court finds that the
appointment of an ombudsman is not necessary for the protection of
patients under the specific facts of the case. Accordingly, Judge
Mark X. Mullin of the U.S. Bankruptcy Court for the Northern
District of Texas issued an order for LH Anesthesia Associates,
P.A., to show cause whether or not a patient care ombudsman will be
appointed in this case.
About LH Anesthesia Associates
LH Anesthesia Associates, P.A., a privately held company in Dallas,
Texas that provides anesthetic services, filed a voluntary Chapter
11 petition (Bankr. N.D. Tex. Case No. 18-42038) on May 25, 2018.
The case is assigned to Judge Mark X. Mullin. The Debtor is
represented by Marilyn D. Garner, Esq., at Law Office of Marilyn
Garner, in Arlington, Texas. At the time of filing, the Debtor had
estimated assets of $1 million to $10 million and estimated
liabilities of $1 million to $10 million. The petition was signed
by Lisa Holley, president.
LUKE'S LOCKER: Has Until Sept. 21 to File Plan of Reorganization
----------------------------------------------------------------
The Hon. Brenda T. Rhoades of the U.S. Bankruptcy Court for the
Eastern District of Texas has extended until Sept. 21, 2018, Luke's
Locker Incorporated's deadline to confirm a plan of
reorganization.
As reported by the Troubled Company Reporter on June 27, 2018, the
Debtor asked the Court to extend until Sept. 15, 2018, its deadline
to confirm a plan of reorganization, saying that because the
Disclosure Statement has not yet been approved by the Court and
will not be considered by the Court until July 2, 2018 hearing, it
is not possible for LLI to confirm a plan of reorganization within
the current deadline.
A copy of the court order is available at:
http://bankrupt.com/misc/txeb17-40126-335.pdf
About Luke's Locker Inc
Luke's Locker Incorporated, owner of Luke's Locker fitness and
running stores in Texas, and its affiliates sought Chapter 11
protection (Bankr. E.D. Tex. Lead Case No. 17-40126) on Jan. 24,
2017. In the petitions signed by Matthew Lucas, president and CEO,
Luke's Locker estimated $1 million to $10 million in assets and
liabilities.
The cases are assigned to Judge Brenda T. Rhoades.
Melissa S. Hayward, Esq., at Franklin Hayward LLP, in Dallas,
serves as the Debtors' counsel. Joseph Sullivan serves as chief
restructuring officer. The Debtor tapped Rosen Systems, Inc., to
sell surplus assets by auction.
No trustee or examiner has been appointed in the Debtors' cases.
MAURICE SPORTING: Has Until Sept. 17 to Exclusively File Plan
-------------------------------------------------------------
The Hon. Christopher S. Sontchi of the U.S. Bankruptcy Court for
the District of Delaware has extended, at the behest of Maurice
Sporting Goods, Inc. and its debtor-affiliates, the exclusive
periods during which only the Debtors can file a Chapter 11 plan
and solicit acceptances of the plan through and including Sept. 17,
2018, and Nov. 14, 2018, respectively.
A copy of the court order is available at:
http://bankrupt.com/misc/deb17-12481-427.pdf
As reproted by the Troubled Company Reporter on June 19, 2018, the
Debtors sought the extension of the Exclusive Periods, saying that
they have continued to wind-down their estates and set the stage
for a chapter 11 plan of liquidation by, among other things,
reviewing and analyzing the administrative, priority and secured
claims filed against the Debtors' estates, including those only
recently filed in advance of the May 21, 2018 governmental bar date
in these Chapter 11 Cases, and beginning work on objections to
certain such claims that are not entitled to the priority asserted
or are otherwise invalid, which will be filed in the near future
and are of paramount importance to confirming a viable plan of
liquidation.
About Maurice Sporting Goods
Maurice Sporting Goods, Inc., established in 1923, is a
family-owned distributor of outdoor sporting goods specializing in
fishing; marine; sports licensed products and souvenirs; outdoor
gifts and decor; hunting; and camping and outdoor recreation.
Collectively, Maurice Sporting Goods services more than 15,000
store fronts across the United States, Canada, South America, and
Europe.
Maurice Sporting Goods, Inc., and 4 affiliated companies sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 17-12481) on
Nov. 20, 2017. Maurice Sporting Goods estimated $10 million to $50
million in total assets and $100 million to $500 million in total
liabilities.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP, as
counsel; Patrick J. O'Malley of Development Specialists, Inc., as
restructuring advisor; Silverman Consulting as financial advisor;
Livingstone Partners LLC as investment banker; and Epiq Bankruptcy
Solutions, LLC, as claims, solicitation and balloting agent.
MEDPLAST HOLDINGS: Moody's Assigns B2 CFR, Outlook Stable
---------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating and
B2-PD Probability of Default Rating to MedPlast Holdings, Inc.
Moody's also assigned a B1 rating to the company's first lien
credit facilities comprised of a $70 million revolving credit
facility and a $500 million first lien term loan and a Caa1 rating
to the company's $225 million second lien term loan. The rating
outlook is stable.
Medplast is acquiring the Advanced Surgical and Orthopedics
business from Integer Holdings Corporation for $600 million. The
transaction will be financed with proceeds from the new credit
facilities and $251 million of equity contributed by its owners.
Proceeds will also be used to refinance existing MedPlast debt and
pay transaction fees.
The following ratings were assigned:
MedPlast Holdings, Inc.
Corporate Family Rating at B2
Probability of Default Rating at B2-PD
$70 million first lien revolving credit expiring 2023 at B1 (LGD
3)
$500 million first lien term loan due 2025 at B1 (LGD 3)
$225 million second lien term loan due 2026 at Caa1 (LGD 5)
Rating outlook: stable
RATINGS RATIONALE
MedPlast's B2 Corporate Family rating reflects its high financial
leverage following the debt-financed purchase of AS&O. Moody's
expects debt/EBITDA to remain high, but fall below six times in the
next 12-18 months. The rating also reflects the integration risk
associated with the AS&O acquisition, which nearly doubles
Medplast's size. Moody's believes that MedPlast benefits from
relatively stable demand for contract manufacturing services among
its large medical device customers. The regulated nature of the
company's products means that the costs to its customers of
switching to another manufacturer are very high. Additionally,
MedPlast's customers bear the vast majority of input cost
volatility. Medplast's and AS&O's operations have complementary
manufacturing platforms, which will enable the combined firm to
broaden and deepen its customer relationships. Medplast's ratings
are constrained by customer concentration as three companies.
Medtronic Plc, Johnson & Johnson and Zimmer Biomet Holdings, Inc.
account for over 40% of revenues. The customer concentration risk
is mitigated by the breadth of products with each company and the
company's long standing relationships with these customers.
The B1 rating assigned to the first lien credit facilities is one
notch higher than the B2 CFR. The first lien credit facilities
benefit from the level of junior capital provided by the second
lien term loan. The Caa1 rating on the second lien term loan
reflects its effective subordination to the revolving credit
facility and first lien term loan.
The rating outlook is stable. Moody's expects that MedPlast will
successfully integrate the AS&O acquisition with debt/EBITDA
tending below six times over the next 12 to 18 months.
Ratings could be upgraded if MedPlast successfully integrates the
AS&O acquisition without disruption to operations or its customer
relationships. Quantitatively, ratings could be upgraded if
debt/EBITDA is sustained below 5 times.
Ratings could be downgraded if integration of AS&O is poorly
executed, the company incurs meaningful contract losses, or if
operating performance deteriorates. Quantitatively, ratings could
be downgraded if debt/EBITDA is sustained above 6 times
Headquartered in Foxborough, MA, MedPlast is an outsourced
manufacturer of medical devices serving a broad range of
therapeutic areas including cardiovascular, orthopedics and
advanced surgical. MedPlast is owned by affiliates of JLL Partners
and Water Street Healthcare Partners.
MESOBLAST LIMITED: Signs Strategic Alliance with China's Tasly
--------------------------------------------------------------
Mesoblast Limited has entered into a strategic alliance with
China's Tasly Pharmaceutical Group (SHA: 600535; Tasly), for the
development, manufacture and commercialization in China of
Mesoblast's allogeneic mesenchymal precursor cell (MPC) product
candidates MPC-150-IM for the treatment or prevention of chronic
heart failure and MPC-25-IC for the treatment or prevention of
acute myocardial infarction.
Key commercial terms of the strategic alliance are as follows:
* Tasly will receive exclusive rights and will fund all
development, manufacturing and commercialization activities
in China for MPC-150-IM and MPC-25-IC.
* Mesoblast will receive US$40 million (AUD$54 million) on
closing, comprising a US$20 million upfront technology access
fee and US$20 million in an equity purchase in Mesoblast
Limited at $1.86 per share, representing a 20% premium to a
blended volume weighted average price calculated over three
months, one month and one day.
* Mesoblast will receive US$25 million on product regulatory
approvals in China.
* Mesoblast will receive double-digit escalating royalties on
net product sales.
* Mesoblast is eligible to receive six escalating milestone
payments upon the product candidates reaching certain sales
thresholds in China.
In order to potentially expedite development and commercialization
of these cardiovascular assets, Tasly and Mesoblast plan to
leverage each other's clinical trial results in China and the
United States and other major jurisdictions respectively to support
their respective regulatory submissions for MPC-150-IM and
MPC-25-IC.
Chairman of Tasly Pharmaceutical Group Mr. Yan Kaijing said: "We
are very excited to partner with Mesoblast, the premier cellular
medicines company, to provide innovative products that have the
potential to make a major impact on the high growth cardiovascular
market in China. This aligns well with our corporate strategy to
be the lead provider of therapies for patients with cardiovascular
conditions in China."
Mesoblast Chief Executive Dr Silviu Itescu stated: "Tasly
Pharmaceutical Group's powerful combination of clinical, regulatory
and manufacturing expertise, together with one of the largest
commercial footprints in cardiology in China, makes it the ideal
partner for Mesoblast and opens up the China market to our
cardiovascular franchise."
The transaction is subject to governmental approvals from the
People's Republic of China (PRC).
About Mesoblast
Headquartered in Melbourne, Australia, Mesoblast Limited (ASX:MSB;
Nasdaq:MESO) -- http://www.mesoblast.com/-- is a global developer
of innovative cell-based medicines. The Company has leveraged its
proprietary technology platform, which is based on specialized
cells known as mesenchymal lineage adult stem cells, to establish a
broad portfolio of late-stage product candidates. Mesoblast's
allogeneic, 'off-the-shelf' cell product candidates target advanced
stages of diseases with high, unmet medical needs including
cardiovascular conditions, orthopedic disorders, immunologic and
inflammatory disorders and oncologic/hematologic conditions.
Mesoblast has facilities in Melbourne, New York, Singapore and
Texas and is listed on the Australian Securities Exchange (MSB) and
on the Nasdaq (MESO).
Mesoblast Limited reported a net loss before income tax of US$90.21
million for the year ended June 30, 2017, a net loss before income
tax of US$90.82 million for the year ended June 30, 2016, and a net
loss before income tax of US$96.24 million for the year ended June
30, 2015. As of March 31, 2018, Mesoblast had US$677.85 million in
total assets, US$121.72 million in total liabilities and US$556.13
million in total equity.
PricewaterhouseCoopers, in Melbourne, Australia, issued a "going
concern" opinion in its report on the consolidated financial
statements for the year ended June 30, 2017, noting that Company
has suffered recurring losses from operations that raise
substantial doubt about its ability to continue as a going concern.
MORGAN STANLEY 2018-H3: Fitch Rates Class G-RR Certs 'B-sf'
-----------------------------------------------------------
Fitch Ratings has assigned the following ratings and Rating
Outlooks to Morgan Stanley Capital I Trust 2018-H3 Commercial
Mortgage Pass-Through Certificates.
-- $24,170,000 class A-1 'AAAsf'; Outlook Stable;
-- $62,010,000 class A-2 'AAAsf'; Outlook Stable;
-- $39,360,000 class A-SB 'AAAsf'; Outlook Stable;
-- $38,050,000 class A-3 'AAAsf'; Outlook Stable;
-- $275,000,000 class A-4 'AAAsf'; Outlook Stable;
-- $278,376,000 class A-5 'AAAsf'; Outlook Stable;
-- $716,966,000a class X-A 'AAAsf'; Outlook Stable;
-- $135,712,000a class X-B 'AA-sf'; Outlook Stable;
-- $90,902,000 class A-S 'AAAsf'; Outlook Stable;
-- $44,810,000 class B 'AA-sf'; Outlook Stable;
-- $43,530,000 class C 'A-sf'; Outlook Stable;
-- $30,727,000ab class X-D 'BBB-sf'; Outlook Stable;
-- $30,727,000b class D 'BBB-sf'; Outlook Stable;
-- $20,485,000bc class E-RR 'BBB-sf'; Outlook Stable;
-- $24,326,000bc class F-RR 'BB-sf'; Outlook Stable;
-- $10,242,000bc class G-RR 'B-sf'; Outlook Stable.
The following classes are not rated by Fitch:
-- $16,644,000bc class H-RR;
-- $25,606,358bc class J-RR.
(a) Notional amount and interest-only.
(b) Privately placed and pursuant to Rule 144A.
(c) Horizontal credit risk retention interest representing no less
than 5% of the estimated fair value of all classes of regular
certificates issued by the issuing entity as of the closing date.
Since Fitch published its expected ratings on June 18, 2018, the
balances for class A-4 and A-5 were finalized. At the time that
expected ratings were assigned, the class A-4 balance range was
$150,000,000 to $$350,000,000 and the expected class A-5 balance
range was $203,376,000 to $403,376,000. The final class size for
class A-4 and A-5 are $275,000,000 and $278,376,000, respectively.
Additionally, the rating of class X-B has been updated to 'AA-sf'
from 'A-sf' based on the final structure. The classes reflect the
final ratings and deal structure.
The final ratings are based on information provided by the issuer
as of July 11, 2018.
The certificates represent the beneficial ownership interest in the
trust, primary assets of which are 66 loans secured by 120
commercial properties having an aggregate principal balance of
$1,024,238,359 as of the cut-off date. The loans were contributed
to the trust by Morgan Stanley Mortgage Capital Holdings LLC,
KeyBank National Association, Argentic Real Estate Finance LLC,
Starwood Mortgage Funding III LLC, Bank of America, National
Association and Citi Real Estate Funding Inc.
Fitch reviewed a comprehensive sample of the transaction's
collateral, including site inspections on 66.0% of the properties
by balance, cash flow analysis of 76.2%, and asset summary reviews
on 100% of the pool.
KEY RATING DRIVERS
Higher Fitch Leverage Relative to Recent Transactions: The pool's
leverage is higher than that of recent Fitch-rated multiborrower
transactions. The pool's Fitch debt service coverage ratio (DSCR)
of 1.16x is below the year-to-date (YTD) 2018 and 2017 averages of
1.25x and 1.26x, respectively. The pool's Fitch LTV of 107.2% is
higher than the YTD 2018 and 2017 averages of 103.8% and 101.6%,
respectively. There are no loans with investment-grade credit
opinions in the pool. The average investment-grade credit opinion
loan concentration for the YTD 2018 is 9.91%.
Low Pool Concentration: This pool is more diverse by loan size than
average. The top-10 loans represent 43.7% of the pool by balance.
This is well below the YTD 2018 and 2017 averages of 51.2% and
53.1%, respectively. The pool's LCI is 288 and SCI is 298.
Comparatively, the YTD 2018 average LCI score is 379 and the YTD
2018 average SCI score is 415.
Limited Amortization: There are 27 loans (54.0% of the pool) that
are full-term interest-only and 21 loans (23.1%) that are partial
interest-only. Based on the scheduled balance at maturity, the pool
will pay down by 6.4%, which is below the YTD 2018 average of 7.4%
and the 2017 average of 7.9%.
RATING SENSITIVITIES
For this transaction, Fitch's net cash flow (NCF) was 11.2% below
the most recent year's net operating income (NOI) for properties
for which a full-year NOI was provided, excluding properties that
were stabilizing during this period. Unanticipated further declines
in property-level NCF could result in higher defaults and loss
severities on defaulted loans and in potential rating actions on
the certificates.
Fitch evaluated the sensitivity of the ratings assigned to the MSC
2018-H3 certificates and found that the transaction displays
average sensitivities to further declines in NCF. In a scenario in
which NCF declined a further 20% from Fitch's NCF, a downgrade of
the junior 'AAAsf' certificates to 'BBB+sf' could result. In a more
severe scenario, in which NCF declined a further 30% from Fitch's
NCF, a downgrade of the junior 'AAAsf' certificates to 'BB+sf'
could result. The presale report includes a detailed explanation of
additional stresses and sensitivities on page 11.
USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G-10
Fitch was provided with Form ABS Due Diligence-15E (Form 15E) as
prepared by Deloitte & Touche LLP. The third-party due diligence
described in Form 15E focused on a comparison and re-computation of
certain characteristics with respect to each of the mortgage loans.
Fitch considered this information in its analysis and the findings
did not have an impact on the analysis or conclusions.
NATIONAL EVENTS: Has Until Oct. 22 to Exclusively File Plan
-----------------------------------------------------------
The Hon. James L. Garrity, Jr., of the U.S. Bankruptcy Court for
the Southern District of New York has extended, at the behest of
National Events of America Inc. and New World Events Group, Inc.,
the exclusive periods during which only the Debtors can file a plan
of reorganization and solicit acceptance of the plan through and
including Oct. 22, 2018, and Dec. 20, 2018, respectively.
As reported by the Troubled Company Reporter on June 28, 2018, the
Debtor sought the extension of the Exclusive Periods to permit the
Corporate Debtors to continue their investigation and efforts to
negotiate a consensual plan or other disposition of these cases
with their creditors and parties in interest.
A copy of the court order is available at:
http://bankrupt.com/misc/nysb17-11798-203.pdf
About National Events Holdings
National Events Holdings, LLC, et al., operate together a ticket
broker and wholesale distributor of tickets for sporting and
theatrical events that was formed in 2006. They provide ticketing
services for all concert, theater and sporting event tickets, as
well as various V.I.P. hospitality packages that deliver exclusive
access to big name events, including hotels, celebrity meet and
greets and exclusive parties.
National Events Holdings, et al., filed for Chapter 11 bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 17-11556) on June 5,
2017.
The Debtors' attorneys are Stephen B. Selbst, Esq., and Hanh V.
Huynh, Esq., at Herrick, Feinstein LLP, in New York. Timothy
Puopolo of RAS Management Advisors, LLC, is the Debtors' chief
restructuring officer.
NCI BUILDING: Moody's Puts Ba3 CFR on Review for Downgrade
----------------------------------------------------------
Moody's Investors Service placed all of the ratings of NCI Building
Systems, Inc., whose Corporate Familyh Rating is Ba3, on review for
downgrade following the company's announcement that it was merging
with Ply Gem Parent, LLC, whose ratings, including a Corporate
Family Rating of B2, were issued under the name Pisces Midco, Inc.
At the same time, Moody's is also placing all of the ratings of
Pisces Midco on review for upgrade.
The review will focus on the combined companies' ability to quickly
delever what will become a heavily indebted balance sheet and to
handle the integration risks of what will in effect be the
combination of three companies into one, since Ply Gem itself
combined with Atrium Windows & Doors only a few months ago. Other
considerations include the relatively new management of NCI (since
2017), which will become the management of the combined companies,
and the ability to achieve the synergies promised.
Issuer: NCI Building Systems, Inc.
On Review for Downgrade:
Probability of Default Rating, Placed on Review for Downgrade,
currently Ba3-PD
Corporate Family Rating, Placed on Review for Downgrade, currently
Ba3
Senior Secured Bank Credit Facility, Placed on Review for
Downgrade, currently Ba3 (LGD4)
Issuer: Pisces Midco, Inc.
On Review for Upgrade:
Probability of Default Rating, Placed on Review for Upgrade,
currently B2-PD
Corporate Family Rating, Placed on Review for Upgrade, currently B2
Senior Secured Bank Credit Facilities, Placed on Review for
Upgrade, currently B2 (LGD3)
Senior Unsecured Regular Bond/Debenture, Placed on Review for
Upgrade, currently Caa1 (LGD6)
Outlook Actions:
Issuer: Pisces Midco, Inc.
Outlook, Changed To Rating Under Review From Stable
Issuer: NCI Building Systems, Inc.
Outlook, Changed To Rating Under Review From Stable
RATINGS RATIONALE
NCI's debt/EBITDA on a standalone basis, which incorporate Moody's
standard adjustments, was 2.6x as of the trailing 12-month period
ended April 29, 2018. Pisces Midco's pro forma adjusted debt/EBITDA
a few months ago after its combination with Atrium Windows & Doors
was 7.3x. On a combined basis, using both companies' estimated pro
forma EBITDA of $540 million, which includes certain aspirational
assumptions, debt/EBITDA would be 5.6x.
Under the terms of the agreement, NCI will issue 58.7 million
shares to Ply Gem shareholders, and its shareholders will own 53%
of the combined company, with Ply Gem shareholders owning the
remaining 47%. Clayton, Dubilier and Rice, which is a major
shareholder of both companies, will continue being a major
shareholder of the combined companies.
Headquartered in Houston, TX, NCI is one of the country's largest
integrated producers of metal products for the commercial building
industry. Its products include engineered metal building systems,
metal components, metal coils, and insulated metal panels.
Revenues, EBITDA, and net income for the trailing 12-month period
ended April 29, 2018 were $1.84 billion, $183 million, and $35
million, respectively.
Ply Gem, headquartered in Cary, NC, produces and sells a variety of
exterior building products for single-family and multi-family
homes, with the major products being windows, doors and siding.
2017 revenues and net income for Ply Gem alone, without Atrium,
were approximately $2.1 billion and $68 million, respectively.
Established in 1948, Atrium is a provider of windows and doors to
the new construction and repair and remodel markets. The company
operates a nationwide network of manufacturing facilities and sells
a comprehensive line of products in all 50 states and Canada.
Atrium generated approximately $350 million of revenue in 2017.
NCI BUILDING: S&P Puts 'BB' Corp Credit Rating on Watch Negative
----------------------------------------------------------------
S&P Global Ratings placed all of its ratings on Cary, N.C.-based
Pisces Midco Inc.--including the 'B' corporate credit rating, 'B'
issue-level rating on its senior secured debt, and 'CCC+'
issue-level rating on its senior unsecured debt--on CreditWatch
with positive implications. S&P said, "The recovery rating on the
senior secured debt is unchanged at '3', indicating our expectation
for meaningful (50%-70%; rounded estimate: 50%) recovery in the
event of default. The recovery rating on the senior unsecured debt
is unchanged at '6', indicating our expectation of negligible
(0%-10%; rounded estimate: 0%) recovery in the event of default."
S&P said, "At the same time, we placed our ratings on Houston-based
NCI Building Systems Inc.--including the 'BB' corporate credit
rating and 'BB+' issue-level rating on its senior secured debt--on
CreditWatch with negative implications. The recovery rating on the
senior secured term loan is unchanged at '2', indicating our
expectation of substantial (70%-90%; rounded estimate: 75%)
recovery in the event of default."
The CreditWatch listings follow the announcement that NCI and
Pisces Midco have signed a definitive agreement to combine in a
stock-for-stock merger. The transaction was unanimously approved by
a special committee of independent directors formed by NCI's board
of directors and by NCI's full board--without the participation of
directors affiliated with Clayton, Dubilier & Rice (CD&R), NCI's
largest shareholder.
S&P said, "We intend to resolve the CreditWatch placements as the
transaction close approaches and further information from the
companies is gathered.
"We could lower the rating on NCI if the combined company's
leverage profile was determined to raise adjusted debt to EBITDA
above 4x on a sustained basis. Alternatively, we could lower the
rating if we determined the company's increased financial sponsor
ownership and/or board representation were an increased credit
risk.
"We could maintain the rating on NCI if we believed the capital
structure would support debt to EBITDA below 4x and the risk of
releveraging beyond 4x was low. It would also require that we view
the company's business and cash flow generation prospects more
favorably.
"We could raise the corporate credit rating on Pisces Midco if we
were to view the company's business and cash flow generation
prospects more favorably and leverage were improved following the
merger. We could also withdraw the corporate credit and issue-level
ratings on Pisces Midco once all of its debt is assumed by the
combined company at the close of the transaction."
NCW PROPERTIES: Case Summary & 13 Unsecured Creditors
-----------------------------------------------------
Debtor: NCW Properties, LLC
2121 Oneida Street
Joliet, IL 60435
Business Description: NCW Properties, LLC --
www.nascarcarwash.com -- owns a car washing
business. Headquartred in Joliet, Illinois,
NCW Properties is an official NASCAR
licensee and holds the exclusive license to
build, brand and operate NASCAR Car Washes
across the US and Canada.
Chapter 11 Petition Date: July 19, 2018
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Case No.: 18-20215
Judge: Hon. Timothy A. Barnes
Debtor's Counsel: Phillip J. Block, Esq.
RIEMER & BRAUNSTEIN LLP
71 South Wacker Drive, Suite 3557
Chicago, IL 60606
Tel: (312) - 780-1173
E-mail: pblock@riemerlaw.com
- and -
Alan L. Braunstein, Esq.
RIEMER & BRAUNSTEIN LLP
Three Center Plaza
Boston, MA 02108
Tel: (617) 523-9000
E-mail: abraunstein@riemerlaw.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dean T. Tomich, manager.
A copy of the Debtor's list of 13 unsecured creditors is available
for free at:
http://bankrupt.com/misc/ilnb18-20215_creditors.pdf
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/ilnb18-20215.pdf
NORTHERN OIL: Appoints Deloitte & Touche as New Auditors
--------------------------------------------------------
Upon approval of the Audit Committee of the Company's Board of
Directors, Northern Oil and Gas, Inc. has engaged Deloitte & Touche
LLP to serve as its independent registered public accounting firm
for the fiscal year ending Dec. 31, 2018. During the fiscal years
ended Dec. 31, 2016 and Dec. 31, 2017, and through July 9, 2018,
neither the company nor anyone acting on its behalf consulted with
Deloitte with respect to any of the matters or reportable events
set forth in Item 304(a)(2)(i) or (ii) of Regulation S-K, according
to a Form 8-K filed with the Securities and Exchange Commission.
About Northern Oil
Minnetonka, Minnesota-based Northern Oil and Gas, Inc. --
http://www.NorthernOil.com/-- is an independent energy company
engaged in the acquisition, exploration, development and production
of oil and natural gas properties, primarily in the Bakken and
Three Forks formations within the Williston Basin in North Dakota
and Montana.
Northern Oil reported a net loss of $9.19 million in 2017, a net
loss of $293.5 million in 2016, and a net loss of $975.4 million in
2015. As of March 31, 2018, Northern Oil had $664.5 million in
total assets, $1.15 billion in total liabilities and a total
stockholders' deficit of $488.8 million.
* * *
In May 2018, Moody's Investors Service upgraded Northern Oil and
Gas, Inc.'s (NOG) Corporate Family Rating (CFR) to 'Caa1' from
'Caa2' and Probability of Default Rating (PDR) to 'Caa1-PD/LD' from
'Caa2-PD'. The upgrade of NOG's CFR to Caa1 reflects its improved
leverage profile, reduced refinancing risk associated with the
remaining $203 million of notes due June 2020, and Moody's
expectation that the company will grow production and operating
cash flows.
ONCOBIOLOGICS INC: Completes Exchange of Series A Preferred Stock
-----------------------------------------------------------------
Oncobiologics, Inc. completed on July 18, 2018, the exchange of an
aggregate of 58,735 shares of voting Series A Convertible Preferred
Stock held by GMS Tenshi Holdings Pte. Limited, a Singapore private
limited company and the Company's controlling stockholder and
strategic partner, for 58,735 shares of its newly created series of
voting convertible preferred stock, voting Series A-1 Convertible
Preferred Stock, par value $0.01 per share. The exchange follows
the conversion of 208,836 shares of Series A into common stock by
GMS Tenshi on June 20, 2018.
The Series A-1 has the same conversion and dividend features as the
Series A (10% per annum, compounded quarterly, payable quarterly at
the Company's option in cash or in kind in additional shares of
Series A-1), but reflects an increased redemption premium (110% to
550%) and increased liquidation preference (120% to 600%) that
provides GMS Tenshi with similar redemption premium and liquidation
preference for its aggregate Series A holdings before the
conversion. The Company and GMS Tenshi also further amended the
Investor Rights Agreement, dated Sept. 11, 2017, to extend such
rights to the Series A-1 and shares of common stock underlying such
preferred stock.
About Oncobiologics
Oncobiologics, Inc. -- http://www.oncobiologics.com/-- is a
clinical-stage biopharmaceutical company focused on identifying,
developing, manufacturing and commercializing complex biosimilar
therapeutics. The Cranbury, New Jersey-based Company's current
focus is on technically challenging and commercially attractive
monoclonal antibodies, or mAbs, in the disease areas of immunology
and oncology.
Oncobiologics reported a net loss attributable to common
stockholders of $40.02 million for the year ended Sept. 30, 2017,
compared to a net loss attributable to common stockholders of
$63.13 million for the year ended Sept. 30, 2016.
As of March 31, 2018, Oncobiologics had $27.78 million in total
assets, $43.05 million in total liabilities, $18.29 million in
series A convertible preferred stock, and a total stockholders'
deficit of $33.56 million.
KPMG LLP, in Philadelphia, Pennsylvania, issued a "going concern"
qualification in its report on the consolidated financial
statements for the year ended Sept. 30, 2017, citing that the
Company has incurred recurring losses and negative cash flows from
operations since inception and has an accumulated deficit at Sept.
30, 2017 of $186.2 million, $13.5 million of senior secured notes
due in December 2018 and $4.6 million of indebtedness that is due
on demand, which raises substantial doubt about its ability to
continue as a going concern.
PACIFIC DRILLING: Seeks Extension of Plan Filing, Mediation Period
------------------------------------------------------------------
Pacific Drilling S.A. disclosed in a regulatory filing with the
U.S. Securities and Exchange Commission that on July 13, 2018, the
Company filed motions with the Bankruptcy Court requesting an order
extending the Mediation and Exclusive Filing Period to July 31,
2018, without prejudice to seek further extensions of the Exclusive
Filing Period.
"Our Exclusive Filing Period will extend at least until a hearing
is held with respect to our Motions. We were unable to obtain an
agreement with respect to a consensual extension of the Exclusive
Filing Period and Mediation. As reflected in our Motions, we have
proposed a timeline for concluding the negotiations and have stated
that we intend to file a plan by the proposed end of the Exclusive
Filing Period (as extended)," the Company said.
In connection with the Mediation, Pacific Drilling disclosed that
it has executed non-disclosure agreements with certain of its
secured creditors to facilitate discussions in the Mediation.
Pursuant to the NDAs, the Company agreed to disclose publicly after
a specified period, if certain conditions were met, the fact that
confidential discussions occurred, and certain information
regarding such discussions.
Under the Bankruptcy Code, Pacific Drilling had the exclusive right
to file a plan of reorganization under Chapter 11 through March 12,
2018.
On March 8, 2018, the Bankruptcy Court approved the Company's
request to extend the Exclusive Filing Period through and including
March 21, 2018 or the date on which the Bankruptcy Court resolved
the Company's request to extend the Exclusive Filing Period.
Pacific Drilling disclosed, "At a hearing on March 22, 2018, the
Bankruptcy Court approved our request for an agreed order, which
was entered on April 2, 2018, under which we, our secured creditor
groups and our majority shareholder agreed to take part in
mediation (the "Mediation") before the Honorable James R. Peck,
retired Bankruptcy Court Judge for the Southern District of New
York. The scope of the Mediation was to facilitate discussions for
the purpose of agreeing to the terms of a binding term sheet or
restructuring support agreement describing a Chapter 11 plan of
reorganization. In addition, conditioned on our participation in
the Mediation, the Bankruptcy Court ordered the extension of the
Exclusive Filing Period to May 21, 2018, without prejudice for us
to seek further extensions of the Exclusive Filing Period."
"On May 16, 2018, May 25, 2018, June 14, 2018 and June 22, 2018,
the Bankruptcy Court approved our requests for agreed orders under
which we, our secured creditor groups and our majority shareholder
agreed to extend the Mediation and the Exclusive Filing Period to
June 4, 2018, June 15, 2018, June 22, 2018 and July 13, 2018,
respectively, without prejudice to seek further extensions of the
Exclusive Filing Period."
Pacific Drilling also filed with the SEC a presentation containing
the proposal that was made by its majority shareholder, Quantum
Pacific (Gibraltar) Limited, certain lenders under the Senior
Secured Credit Facility and a third-party investor, on July 11,
2018 to the independent members of the Company's Board of Directors
for a plan of reorganization. A copy of the Proposal is available
at https://is.gd/Jk6R9U
The Company also filed a presentation containing the proposal that
was made by an ad hoc group of its secured creditors on July 11,
2018 to the independent members of the Board of Directors for a
plan of reorganization. A copy of that Proposal is available at
https://is.gd/wOmxxM
The Company noted that neither the QP Group / SSCF Proposal, the Ad
Hoc Group Proposal nor any other proposal is legally-binding or
indicative of the terms of any Chapter 11 plan of reorganization
that may occur.
"There is no consensus currently among the Company and its
stakeholders as to the terms of any plan of reorganization," the
Company said.
About Pacific Drilling
Pacific Drilling S.A. (OTC: PACDQ) a Luxembourg public limited
liability company (societe anonyme), operates an international
offshore drilling business that specializes in ultra-deepwater and
complex well construction services. Pacific Drilling --
http://www.pacificdrilling.com/-- owns seven high-specification
floating rigs: the Pacific Bora, the Pacific Mistral, the Pacific
Scirocco, the Pacific Santa Ana, the Pacific Khamsin, the Pacific
Sharav and the Pacific Meltem. All drillships are of the latest
generations, delivered between 2010 and 2014, with a combined
historical acquisition cost exceeding $5.0 billion. The average
useful life of a drillship exceeds 25 years.
On Nov. 12, 2017, Pacific Drilling S.A. and 21 affiliates each
filed a voluntary petition for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
17-13193). The cases are pending before the Honorable Michael E.
Wiles and are jointly administered.
Pacific Drilling disclosed $5.46 billion in assets and $3.18
billion in liabilities as of Sept. 30, 2017.
The Debtors tapped Sullivan & Cromwell LLP as bankruptcy counsel
but was later replaced by Togut, Segal & Segal LLP; Evercore
Partners International LLP as investment banker; AlixPartners, LLP,
as restructuring advisor; Alvarez & Marsal Taxand, LLC as executive
compensation and benefits consultant; Ince & Co LLP and Jones
Walker LLP as special counsel; and Prime Clerk LLC as claims and
noticing agent.
The RCF Agent tapped Shearman & Sterling LLP, as counsel, and PJT
Partners LP, as financial advisor.
The ad hoc group of RCF Lenders engaged White & Case LLP, as
counsel.
The SSCF Agent tapped Milbank Tweed, Hadley & McCloy LLP, as
counsel, and Moelis & Company LLC, as financial advisor.
The Ad Hoc Group of Various Holders of the Ship Group C Debt, 2020
Notes and Term Loan B tapped Paul, Weiss, Rifkind, Wharton &
Garrison, in New York as counsel.
PELICAN REAL ESTATE: July 30 Auction of Consumer Accounts Pool
--------------------------------------------------------------
Judge Cynthia C. Jackson of the U.S. Bankruptcy Court for the
Middle District of Florida conditionally approved the sale
procedures and the Purchase and Sale Agreement with DNF Associates,
LLC or assigns, of Maria M. Yip, Liquidating Trustee of the Smart
Money Liquidating Trust and its debtor-affiliates, in connection
with the sale of consumer accounts pool for $48,593, subject to
overbid.
The Consumer Accounts Pool is summarized as follows:
Loan Pool: $27,188, 315
Number of Accounts: 4,920
Eligible Inventory: $24,296,260
Price: 0.20%
Total Price: $48,593
The salient terms of the Bidding Procedures are:
a. Qualifying Bid: $50,000
b. Deposit: $48,493
c. Bid Deadline: July 26, 2018 at 5:00 p.m. (ET)
d. Auction: The Liquidating Trustee will conduct an auction on
July 30, 2018 at 3:00 p.m. (ET) at the offices of Broad and Cassel,
LLP, One Financial Plaza, 100 S.E. 3rd Avenue, Suite 2700, Fort
Lauderdale, Florida, in accordance with the procedures set forth in
the Sale Notice.
e. Sale Hearing: Aug. 2, 2018 at 11:00 a.m.
The Court conditionally approved the Liquidating Trustee's Notice
of Proposed Sale and Sale Procedures. The Liquidating Trustee will
serve the Sale Notice on all creditors and all other parties who
were served with the Motion.
Anyone claiming a lien, claim, or other interest in the proceeds
from the sale must file a response asserting such a claim by July
5, 2018 at 5:00 p.m. (ET).
The Court's conditional approval of the Sale Notice and the Bidding
Procedures will be final unless an objection is filed within seven
days from the entry of the Order. If an objection is filed, then
the Court will set the objection for hearing on an expedited
basis.
About Pelican Real Estate
Pelican Real Estate, LLC, and its eight affiliates sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D.
Fla. Lead Case No. 16-03817) on June 8, 2016. In the petition
signed by Jared Crapson, president of SMFG, Inc., manager of
Pelican Management Company, LLC, Pelican Real Estate estimated
under $50,000 in both assets and debt.
The Debtors tapped Elizabeth A. Green, Esq., at Baker & Hostetler
LLP, as bankruptcy counsel. The Debtors hired Bill Maloney
Consulting as their financial advisor; Hammer Herzog and Associates
P.A. as their accountant; and Pino Nicholson PLLC as their special
counsel.
Turnkey Investment Fund LLC, an affiliate of Pelican Real Estate
LLC, hired Dance Bigelow Sharp & Co. as accountant.
Guy Gebhardt, acting U.S. trustee for Region 21, on July 27, 2016,
formed an official committee of unsecured creditors for Pelican
Real Estate LLC's affiliates, Smart Money Secured Income Fund LLC
and Accelerated Asset Group LLC.
Maria Yip was appointed examiner in the case. She hired
GrayRobinson, P.A., as her lead counsel; Fikso Kretschmer Smith
Dixon Ormseth PS as special counsel; and Schweet Linde & Coulson,
PLLC, as special foreclosure counsel.
* * *
On Feb. 15, 2017, the Court entered an order confirming the
Debtors' Second Amended Plan of Liquidation. The Plan became
effective on March 2, 2017, at which time the Smart Money
Liquidating Trust came into existence and Ms. Yip was named the
liquidating trustee.
PF ROOSEVELT: S&P Withdraws 'BB+' Rating on 2014A Rev. Bonds
------------------------------------------------------------
S&P Global Ratings withdrew its 'BB+' long-term rating on the
Public Finance Authority, Wis.' series 2014A multifamily housing
revenue bonds, issued for PF Roosevelt LLC, N.Y. (Roosevelt Gardens
Apartments, Fla.). The rating was suspended on June 19, 2018.
This action follows repeated attempts by S&P Global Ratings to
obtain timely information of satisfactory quality to maintain the
rating on the security in accordance with its applicable criteria
and policies. Roosevelt GA LLC failed to post audited financial
2017 information to EMMA (Electronic Municipal Market Access) last
February, in violation of its continuing disclosure agreement and
SEC Rule 15c2-12. The agreement calls for the organization to post
audited information on an annual basis. The organization still has
not provided the information.
The withdrawal of this rating was preceded, in accordance with
S&P's policies, by any change to the rating we consider appropriate
given available information.
PICOTEO DE TAPAS: Case Summary & 10 Unsecured Creditors
-------------------------------------------------------
Debtor: Picoteo De Tapas Inc.
PO Box 6537
San Juan, PR 00914
Business Description: Picoteo De Tapas Inc. is a corporation
organized under the laws of Puerto
Rico engaged in the restaurant business.
Chapter 11 Petition Date: July 19, 2018
Case No.: 18-04092
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Debtor's Counsel: Harold A. Frye Maldonado, Esq.
FRYE MALDONADO LAW FIRM
PO Box 366973
San Juan, PR 00936
Tel: (787) 767-3800
Fax: (800) 204-0744
E-mail: frye.maldonado@gmail.com
Total Assets: $1,556,309
Total Liabilities: $409,539
The petition was signed by Irvin V. Polanco Viera, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 10 unsecured creditors is available for free
at:
http://bankrupt.com/misc/prb18-04092.pdf
PRAGAT PURSHOTTAM: Case Summary & 5 Unsecured Creditors
-------------------------------------------------------
Debtor: Pragat Purshottam, Inc.
1464 Sandburg Drive
Schaumburg, IL 60173
Business Description: Pragat Purshottam, Inc. is a real estate
company that owns a commercial property
located at 270-280 Glen Ellyn Road,
Bloomingdale, Illinois valued by the
company at $500,000.
Chapter 11 Petition Date: July 19, 2018
Case No.: 18-20221
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Hon. Carol A. Doyle
Debtor's Counsel: Richard L. Hirsh, Esq.
RICHARD L. HIRSH, P.C.
1500 Eisenhower Lane, Suite 800
Lisle, IL 60532
Tel: 630-434-2600
Fax: 630 434-2626
E-mail: richala@sbcglobal.net
Total Assets: $505,578
Total Liabilities: $1,559,150
The petition was signed by Nikunj Patel, manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's five unsecured creditors is available for free
at:
http://bankrupt.com/misc/ilnb18-20221.pdf
PRECIPIO INC: Expects 213% YoY Revenue Growth in Q2 2018
--------------------------------------------------------
Specialty cancer diagnostics company Precipio, Inc. reported
preliminary second quarter results representing continued triple
digit year-over-year growth.
Quarter over quarter sequential growth was 14% which, at a
compounded run rate of circa 70% annually currently represents
early stage growth generated from pathology services. Precipio
expects a continuation of this rate throughout 2018, as the
expanding pathology services sales organization ramps, and its ICE
COLD PCR liquid biopsy cancer detection products segment gains
commercial traction.
On a preliminary basis, revenue for the second quarter is expected
to be $815,000, up from $260,000 in Q2-2017, an increase of 213%.
In Q4-2017 and in Q1-2018, YoY revenue growth was 199% and 187%
respectively, showing continued triple-digit YoY growth. Revenue
for the first half of 2018 is estimated at $1.5 million, a tripling
of revenue from $0.5 million in the first half of 2017.
Sales of Precipio pathology services were the primary contributor
to the second quarter's revenues, which benefited from integration
of the business segment's recently expanded sales team and
increased awareness of the value proposition of academic expertise
and cancer pathology specialization.
The Company's ICP sales growth plan remains focused on hospitals,
large CRO's, OEM's and national scale labs, with the goal of
capturing a substantial share of the multi-billion dollar liquid
biopsy market opportunity.
"These results represent further validation of our high growth
strategy to rapidly gain pathology services market share, and
commercialize our unique liquid biopsy, mutation detection products
for cancer," commented CEO Ilan Danieli. "We are confident with
the potential effect on market and enterprise value resulting from
this trend, as we continue to hit revenue and commercialization
milestones."
About Precipio
Omaha, Nebraska-based Precipio, formerly known as Transgenomic,
Inc. -- http://www.precipiodx.com/-- is a cancer diagnostics
company providing diagnostic products and services to the oncology
market. The Company has developed a platform designed to eradicate
misdiagnoses by harnessing the intellect, expertise and technology
developed within academic institutions and delivering quality
diagnostic information to physicians and their patients worldwide.
Precipio operates a cancer diagnostic laboratory located in New
Haven, Connecticut and has partnered with the Yale School of
Medicine.
The audit opinion included in the company's Annual Report on Form
10-K for the year ended Dec. 31, 2017 contains a going concern
explanatory paragraph. Marcum LLP, the Company's auditor since
2016, stated that the Company has a significant working capital
deficiency, has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
Precipio reported a net loss available to common stockholders of
$33.21 million in 2017 and a net loss available to common
stockholders of $4.08 million in 2016. As of March 31, 2018,
Precipio had $26.09 million in total assets, $12.68 million in
total liabilities and $13.40 million in total stockholders'
equity.
Nasdaq Delisting Notice
On March 26, 2018, Precipio received written notice from The Nasdaq
Stock Market LLC indicating that, based on the closing bid price of
the Company's common stock for the preceding 30 consecutive
business days, the Company is not in compliance with the $1.00
minimum bid price requirement for continued listing on the Nasdaq
Capital Market. The Notice has no immediate effect on the listing
of Precipio's common stock, and its common stock will continue to
trade on the Nasdaq Capital Market under the symbol "PRPO" at this
time. In accordance with Nasdaq Listing Rule 5810(c)(3)(A),
Precipio has a period of 180 calendar days, or until Sept. 24, 2018
to regain compliance with the Minimum Bid Price Requirement.
PUERTO RICO: Utility Directors Resign as Gov. Demands CEO Pay Cut
-----------------------------------------------------------------
Andrew Scurria, writing for the The Wall Street Journal Pro
Bankruptcy, reported that five members of the board of directors of
Prepa, Puerto Rico's public power monopoly, resigned on July 12,
alleging political interference after top lawmakers and the U.S.
territory's governor demanded cuts to a chief executive
compensation package.
According to the report, five board members at the public power
monopoly known as Prepa said in a resignation letter that
"political forces in Puerto Rico" had been meddling in their
decisions and "want to continue to control Prepa." The incoming
CEO was among the board resignations, leaving Prepa leaderless a
day after the current CEO, Walter Higgins, said he was departing,
the report related.
The report further related that the seven-member board came under
fire after offering Mr. Higgins's successor a $750,000 salary,
which top Puerto Rican politicians criticized as excessive for a
bankrupt utility. Gov. Ricardo Rossello said the compensation was
"not proportional" to Prepa's financial condition and called on the
utility's board members to cut the CEO salary or resign, the report
said.
The departures threw Prepa's leadership into disarray as the
utility vies with bondholders in court to drive down a $9 billion
debt load and solicits new investments for a dilapidated power
system, the report noted.
The resignations also marked an unusual rebuke to political
meddling for a public authority often accused of being politicized,
the report further noted. Prepa has long been plagued by frequent
turnover at the top, with politically connected officials cycling
in and out depending on the party in power, the report added.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
and management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Youngis
the Board's financial advisor, and Citigroup Global Markets Inc. is
the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at
https://cases.primeclerk.com/puertorico
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
Bondholders' Attorneys
Kramer Levin Naftalis & Frankel LLP and Toro, Colon, Mullet, Rivera
& Sifre, P.S.C. and serve as counsel to the Mutual Fund Group,
comprised of mutual funds managed by Oppenheimer Funds, Inc., and
the First Puerto Rico Family of Funds, which collectively hold over
$4.4 billion of GO Bonds, COFINA Bonds, and other bonds issued by
Puerto Rico and other instrumentalities.
White & Case LLP and Lopez Sanchez & Pirillo LLC represent the UBS
Family of Funds and the Puerto Rico Family of Funds, which hold
$613.3 million in COFINA bonds.
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Robbins, Russell,
Englert, Orseck, Untereiner & Sauber LLP, and Jimenez, Graffam &
Lausell are co-counsel to the ad hoc group of General Obligation
Bondholders, comprised of Aurelius Capital Management, LP, Autonomy
Capital (Jersey) LP, FCO Advisors LP, and Monarch Alternative
Capital LP.
Quinn Emanuel Urquhart & Sullivan, LLP and Reichard & Escalera are
co-counsel to the ad hoc coalition of holders of senior bonds
issued by COFINA, comprised of at least 30 institutional holders,
including Canyon Capital Advisors LLC and Varde Investment
Partners, L.P.
Correa Acevedo & Abesada Law Offices, P.S.C., is counsel to Canyon
Capital Advisors, LLC, River Canyon Fund Management, LLC, Davidson
Kempner Capital Management LP, OZ Management, LP, and OZ Management
II LP (the QTCB Noteholder Group).
Committees
The U.S. Trustee formed an official committee of retirees and an
official committee of unsecured creditors of the Commonwealth. The
Retiree Committee tapped Jenner & Block LLP and Bennazar, Garcia &
Milian, C.S.P., as its attorneys. The Creditors Committee tapped
Paul Hastings LLP and O'Neill & Gilmore LLC as counsel.
QUANTUM WELLNESS: Modifies Treatment of Opus, AmEx Claims
---------------------------------------------------------
Quantum Wellness Botanical Institute, LLC, filed an amended
disclosure statement in support of its plan of reorganization to,
among other things, modify the treatment of the secured claims of
Opus Bank and American Express.
American Express filed an objection to the previously filed
Disclosure Statement, disputing the characterization of the
creditworthiness of the Reorganized Debtor as "low risk," and
maintains that the Risk Adjustment should be significantly larger
than 1.0%. In the Amended Disclosure Statement, the Debtor used
the Till analysis to justify the interest rate provided to American
Express's secured claim.
Class 4 Secured Claim of American Express, if allowed, to the
extent of the value of its Collateral as determined at the
Confirmation Hearing, will be paid as follows:
* Equal monthly payments based on a five year amortization;
* At six percent interest rate;
* Payable on the 15th day of each month; and
* Commencing on the 15th day of the first month following the
payment in full of the Opus Secured Claim and continuing until paid
in full.
The Amended Plan also provides that each holder of an Allowed
General Unsecured Claim will be paid the sum of 10% of their
allowed amount, not to exceed $125,000, in equal monthly payments,
over a period of 12 months commencing on the latter of July 1,
2019, or the first day of the first month following the payments in
full of Classes 1 (Priority Claims) and 2 (Administrative
Convenience Claims).
A redlined version of the Amended Disclosure Statement is available
at:
http://bankrupt.com/misc/azb17-13721-163-1.pdf
About Quantum Wellness
Quantum Wellness Botanical Institute, LLC --
http://quantumwellnessbotanicalinstitute.com/-- is a producer of
plant-based nutritional supplements based in Scottsdale, Arizona.
Quantum Wellness sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Ariz. Case No. 17-13721) on Nov. 17,
2017. In the petition signed by CEO Fred Auzenne, the Debtor
estimated assets and liabilities of $1 million to $10 million.
Judge Eddward P. Ballinger Jr. presides over the case.
Littler PC is the Debtor's bankruptcy counsel. The Debtor hired
Olshan Frome Wolosky LLP as special counsel and Durham Jones
Pinegar as local counsel.
No official committee of unsecured creditors has been appointed in
the Chapter 11 case.
QUECHAN INDIAN: Fitch Affirms 'B' Issuer Default Rating
-------------------------------------------------------
Fitch Ratings has affirmed the Quechan Indian Tribe's Issuer
Default Rating (IDR) at 'B'. In addition, Fitch has affirmed
Quechan's approximately $27 million in outstanding tribal economic
development bonds (TED bonds) at 'BB-/RR2'. The Rating Outlook is
Stable.
The tribe also has a credit facility that ranks pari passu to the
TED bonds, which Fitch does not rate, that is comprised of a $67
million term loan.
KEY RATING DRIVERS
Fitch's affirmation reflects the tribe's stable operating profile
and the ability for the tribe to continue delevering and improve
liquidity through expected solid free cash flow generation. Quechan
has experienced material delevering over the past five years,
driven primarily by debt paydown vis-a-vis the heavy amortization
of their old term loan. In addition to Quechan's delevering, the
tribe's recent refinancing of their capital structure provides
additional financial flexibility and the potential to develop a
stronger unrestricted cash position. Quechan's leverage was 2.3x as
of LTM March 31, 2018, down from 2.8x in 2017. Fitch expects
leverage to fall below 2.0x in the next two years, primarily due to
debt paydown from the amortization schedule, which is manageable.
The TED bond amortization payments began last year at $2.5
million-$3.0 million each per year. The new credit facility will
also amortize at $~8.9 million per year, a reduction from the
around $14 million of the previous credit facility. Fitch forecasts
marginal EBITDA growth through the forecast period as a result of
the tribe's adjusted revenue share payments to the state of
California and continued promotional play cost-cutting.
Fitch expects unrestricted cash levels for the tribe to gradually
increase in light of a lighter amortization schedule after the
capital structure refinancing, temporary halt of per-capita
payments and the tribal council's view of cash buildup as a
strategic priority. This assumes stable to slightly positive casino
profitability, relatively low amount of casino capital expenditures
and muted tribal expenditures. This also assumes no investment
income, although this has been a meaningful source of income for
the tribe in prior years.
The tribe experienced leadership turnover in mid-2015 when a new
president and vice president were elected to the tribal council.
Despite the turnover, the current leadership maintained the
previous leadership's commitment to maintaining its liquidity and
reducing government spending. Fitch will continue to monitor the
tribal council's policies and the potential for political turnover
is reflected in the current IDR.
DERIVATION SUMMARY
Fitch believes the tribe's current credit metrics warrant the
ability to sustain through-cycle at the mid-to-upper 'B' level. The
strong credit metrics are somewhat offset by the geographic
concentration of Quechan's casinos and limited track record of the
current tribal leadership relative to financial policies. The
tribe's recent refinancing of their capital structure created
additional financial flexibility and the potential to grow tribal
reserves, which is a credit positive. Recent operational
performance should continue to support free cash flow generation as
well.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Low single-digit revenue growth in 2018 and 2019, supported by
the renovation of the Paradise Resort Casino. Flat revenues
thereafter similar to other regional gaming markets;
-- No incremental debt and debt balances follow the amortization
schedule;
-- Distributions to the tribe are expected to gradually increase
over the years as operations grow.
RATING SENSITIVITIES
Future Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Positive rating action could be considered if the tribe
maintains leverage below 2.0x; if tribal cash reserves increase and
are maintained through-the-cycle at the tribe's stated goal of
providing for 25% of annual governmental expenditures; and Yuma
area's economic conditions continue to improve or remain stable.
Future Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Leverage increasing and remaining above 3.0x;
-- A substantial decrease in tribal reserves or a change of
financial policies to maintain lower cash reserves;
-- The tribe failing to maintain prudent fiscal management
policies (i.e. adjusting governmental spending to match casino
distributions and other revenue sources).
LIQUIDITY
Liquidity is adequate with the unrestricted cash at the tribal
level commensurate with the size of the tribe and its governmental
budget, although this is set to improve over the next few years.
Available liquidity on the casino side is adequate for operating
needs when taking into account the healthy free cash flow (FCF) at
the casino enterprise before distributions to the tribe, as well as
the credit facility covenants that limit tribal distributions based
on cash flow. The tribe no longer maintains a revolver following
the refinancing last year.
FULL LIST OF RATING ACTIONS
Quechan Indian Tribe
-- Long-Term IDR affirmed at 'B'; Outlook Stable;
-- Tribal economic development bonds affirmed at 'BB-/RR2'.
RED RIVER: Aug. 7 Plan Confirmation Hearing
-------------------------------------------
Judge Tracey N. Wise of the U.S. Bankruptcy Court for the Eastern
District of Kentucky has conditionally approved the disclosure
statement explaining the first amended small business Chapter 11
plan filed by the Chapter 11 trustee of Red River Healthcare, LLC,
and has scheduled August 7, 2018, at 9:30 a.m. (ET), for the
hearing on confirmation. July 31, 2018 at 5:00 PM (ET), is fixed
as the deadline for filing written acceptances or rejections to the
Plan.
About Red River Healthcare
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
Asthma and Allergy Center, LLC, and Pediatric Associates of
Pikeville, LLC each filed chapter 11 petitions (Bankr. E.D. Ky.
Case No. 15-51438, 15-51439, 15-70469, and 15-70470) on July 21,
2015. Salyersville Medical Center, LLC filed a chapter 11 petition
(Bankr. E.D. Ky. Case No. 15-70818) on December 21, 2015. The
petitions were signed by Djien H. So, managing member. The Debtors
are represented by Jamie L. Harris, Esq., at Delcotto Law Group
PLLC. All cases are jointly administered for procedural purposes
only.
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
and Pediatric Associates of Pikeville, LLC each estimated assets
and liabilities at $100,001 to $500,000. Asthma and Allergy Center,
LLC and Salyersville Medical Center, LLC each estimated assets at
$100,001 to $500,000 and liabilities at $500,001 to $1 million.
Adam M. Back, Esq., was appointed Chapter 11 Trustee, and is
represented by Jessica L. Middendorf, Esq., at Stoll Keenon Ogden
PLLC, in Lexington, Kentucky.
RISE ENTERPRISES: Pending Talks With Creditors Delay Plan Filing
----------------------------------------------------------------
Rise Enterprises, S.E., asks the U.S. Bankruptcy Court for the
District of Puerto Rico to extend by 60 days the exclusivity period
during which only the Debtor can file a plan of reorganization.
In addition, the Debtor requests that the deadline to obtain the
votes for the Plan of Reorganization be extended for a term of 60
days after the order approving the Disclosure Statement is
entered.
As reported by the Troubled Company Reporter on May 4, 2018, the
Debtor previously asked the Court for a 60-day extension of the
exclusivity period and the period for filing Disclosure Statement
and Plan, and to allow a term of 60 days after the order approving
the Disclosure Statement is entered to procure the votes for the
Plan.
There are pending negotiations with the creditors that need to be
resolved prior to the filing of the Disclosure Statement and Plan.
The Debtor assures the Court that it is meeting its obligations as
Debtor in possession. Monthly Operating Reports have been filed
and quarterly fees have been paid.
Any extension of time will not harm the creditors but will increase
the possibilities of a successful reorganization.
A copy of the Debtor's request is available at:
http://bankrupt.com/misc/prb17-04678-116.pdf
About Rise Enterprises
Rise Enterprises, S.E., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.P.R. Case No. 17-04678) on June 30, 2017.
In the petition signed by Ismael Falcon Ortega, partner, the
Debtor estimated assets of less than $1 million and liabilities of
$1 million to $10 million. Judge Mildred Caban Flores presides
over the case. Mary Ann Gandia, Esq., at Gandia-Fabian Law Office,
serves as the Debtor's bankruptcy counsel.
SALYERSVILLE MEDICAL: Aug. 7 Plan Confirmation Hearing
------------------------------------------------------
Judge Tracey N. Wise of the U.S. Bankruptcy Court for the Eastern
District of Kentucky has conditionally approved the disclosure
statement explaining the first amended small business Chapter 11
plan filed by the Chapter 11 trustee of Salyersville Medical
Center, LLC, and has scheduled August 7, 2018, at 9:30 a.m. (ET),
for the hearing on confirmation. July 31, 2018 at 5:00 PM (ET), is
fixed as the deadline for filing written acceptances or rejections
to the Plan.
About Salyersville Medical Center
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
Asthma and Allergy Center, LLC, and Pediatric Associates of
Pikeville, LLC each filed chapter 11 petitions (Bankr. E.D. Ky.
Case No. 15-51438, 15-51439, 15-70469, and 15-70470) on July 21,
2015. Salyersville Medical Center, LLC filed a chapter 11 petition
(Bankr. E.D. Ky. Case No. 15-70818) on December 21, 2015. The
petitions were signed by Djien H. So, managing member. The Debtors
are represented by Jamie L. Harris, Esq., at Delcotto Law Group
PLLC. The cases are jointly administered for procedural purposes
only.
Red River Healthcare, LLC, Aaron K. Jonan Memorial Clinic, Inc.,
and Pediatric Associates of Pikeville, LLC each estimated assets
and liabilities at $100,001 to $500,000. Asthma and Allergy Center,
LLC and Salyersville Medical Center, LLC each estimated assets at
$100,001 to $500,000 and liabilities at $500,001 to $1 million.
Adam M. Back, Esq., was appointed Chapter 11 Trustee, and is
represented by Jessica L. Middendorf, Esq., at Stoll Keenon Ogden
PLLC, in Lexington, Kentucky.
SAM MEYERS: $1.2M Sale of Louisville Property to Hollenbach Okayed
------------------------------------------------------------------
Judge Alan C. Scott of the U.S. Bankruptcy Court for the Western
District of Kentucky authorized Sam Meyers, Inc.'s sale of the real
property known as 3400 Bashford Avenue Court, Louisville, Kentucky,
together with all easements, privileges, permits, licenses, and
appurtenances of any kind whatsoever related to the real property;
and all fixtures, furnishings, appliances, equipment, and other
types of items of personal property affixed to the improvements on,
and/or located on and used in connection with the use or
maintenance of the real property, to John P. Hollenbach, Sr. or his
assigns for $1.2 million.
The sale is free and clear of all Claims, with all other Claims
that represent interests in property to attach to the net proceeds
of the Property.
About Sam Meyers Inc.
Sam Meyers, Inc. -- http://sammeyers.com-- is a wholesale supplier
of men's formal wear and accessories. It also owns and operates a
dry cleaning business in the Midwest. In addition to its
Louisville locations, Sam Meyers owns a store in Nashville,
Tennessee, that specializes in costume rentals and sales in
addition to formal wear; a tuxedo store in Evansville, Indiana; and
a satellite warehouse in Boston, Massachusetts. Sam Meyers' main
warehouse is located in Louisville.
Sam Meyers sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. W.D. Ky. Case No. 18-31559) on May 17, 2018. In the
petition signed by James P. Corbett, president, the Debtor
disclosed $1.8 million in assets and $2.91 million in liabilities.
Judge Alan C. Stout presides over the case. KAPLAN JOHNSON ABATE &
BIRD LLP is the Debtor's counsel.
SCOTTISH HOLDINGS: Aug. 2 Plan Confirmation Hearing
---------------------------------------------------
Judge Laurie Selber Silverstein of the U.S. Bankruptcy Court for
the District of Delaware approved Scottish Holdings, Inc., and
Scottish Annuity & Life Insurance Company (Cayman) Ltd.'s
disclosure statement in support of its second amended joint chapter
11 plan dated June 28, 2018.
The deadline by which all Ballots to accept or reject the Plan is
set as August 13, 2018 at 4:00 p.m. (prevailing Eastern Time).
The Confirmation Hearing will be held on August 22, 2018 at 10:00
a.m. (prevailing Eastern Time).
The deadline to object or respond to confirmation of the Plan is
set as August 10, 2018, at 4:00 p.m. (prevailing Eastern Time).
The new plan provides for the sale of SALIC and certain of its
Affiliates as a going to Hildene Re Holdings, LLC2 free and clear
of all funded indebtedness and certain general unsecured claims
unrelated to SALIC's reinsurance business. More specifically, the
Plan provides for: (1) the reorganization and recapitalization of
the Debtors and certain of their non-debtor Affiliates through a
new money contribution of $12,500,000 by the Purchaser in the form
of the Recapitalization Funding Payment; (2) the funding of
distributions to the Debtors’ Creditors through a new money
contribution of $21,500,000 by the Purchaser in the form of the
Plan Funding Payment subject to reduction by the amount of the
TruPS Returned Cash; (3) in exchange for the foregoing payments and
other consideration, the issuance or assignment to the Purchaser of
100% of the New Equity, subject to downward adjustment to no less
than 70%, to the extent that eligible unsecured creditors elect to
receive their pro rata share of up to 30% of the New Equity, in
lieu of a cash distribution under the Plan; (4) the assumption by
the Reorganized Debtors of the Net Worth Maintenance Agreements
and all Reinsurance Contracts and Reserve Financing Contracts (each
as defined in the Stock Purchase Agreement); (5) creation of the
Distribution Trust (a) for payment of all Secured Claims,
Administrative Claims, and Priority Claims to the extent Allowed
and not paid or otherwise satisfied prior to the Effective Date,
and (b) for the benefit of Holders of SHI TruPS Claims, SHI General
Unsecured Claims, SALIC TruPS Claims and SALIC General Unsecured
Claims, all to the extent Allowed; and (6) funding of the
Distribution Trust with the Distribution Trust Assets, as well as
the Available Plan Distribution Funding Payment and the
Distribution Trust Reserves.
Each Holder of an Allowed SHI General Unsecured Claim in Class 5
will receive the following Distributions:
(1) The Holder's TruPS/GUC Claims Cash Distribution Amount; and
(2) The Holder's applicable percentage of the Distribution Trust
Assets Proceeds, calculated as the amount of the Allowed Amount of
the Holder's SHI General
Unsecured Claims divided by the TruPS/GUC Claims Aggregate Amount.
The projected recovery for Class 5 claimants is 6-8%.
Each Holder of an Allowed SALIC General Unsecured Claim in Class 7
will receive the following Distributions:
(1) The Holder's TruPS/GUC Claims Cash Distribution Amount; and
(2) The Holder's applicable percentage of the Distribution Trust
Assets Proceeds, calculated as the amount of the Allowed Amount of
the Holder's SALIC General Unsecured Claims divided by the
TruPS/GUC Claims Aggregate Amount.
The projected recovery for Class 7 claimants is 6-8%.
On the Effective Date, the Recapitalization Funding Payment will be
funded to Reorganized SALIC by the Purchaser in accordance with the
terms of the Stock Purchase Agreement and the Plan. The
Recapitalization Funding Payment will not be used to make
Distributions.
A full-text copy of the Latest Disclosure Statement dated June 28,
2018 is available at:
http://bankrupt.com/misc/deb18-10160-382.pdf
A full-text copy of the Second Amended Plan is available at:
http://bankrupt.com/misc/deb18-10160-381.pdf
About Scottish Holdings
Scottish Holdings, Inc., and Scottish Annuity & Life Insurance
Company (Cayman) operate as subsidiaries of Scottish Re Group Ltd.
Scottish Re Group Limited -- http://www.scottishre.com/-- is a
holding company organized under the laws of the Cayman Islands with
its principal executive office in Bermuda. Through its operating
subsidiaries, the company is engaged in the reinsurance of life
insurance, annuities and annuity-type products. These products are
written by life insurance companies and other financial
institutions primarily located in the United States. Scottish Re
Group has operating companies in Bermuda, Ireland, and the United
States.
Scottish Holdings and Scottish Annuity sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
18-10160) on Jan. 28, 2018. In the petition signed by CEO Gregg
Klinenberg, the Debtor estimated assets and liabilities of $1
billion to $10 billion.
The Debtors hired Hogan Lovells US LLP as bankruptcy counsel;
Morris, Nichols, Arsht & Tunnell LLP as co-counsel; Mayer Brown LLP
as special counsel; and Keefe, Bruyette & Woods, Inc. as investment
banker.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on Feb. 20, 2018. The Committee tapped Mayer
Brown LLP as special counsel and Appleby (Cayman) Ltd. as special
counsel.
Max Mailliet serves as Luxembourg insolvency receiver of non-debtor
affiliate Scottish Financial (Luxembourg) S.a r.l.
SHARING ECONOMY: Will Sell $50 Million Worth of Securities
----------------------------------------------------------
Sharing Economy International Inc. has filed a Form S-3
registration statement with the Securities and Exchange Commission
in connection with the offer and sale of up to $50,000,000 in the
aggregate of common stock, preferred stock, warrants to purchase
common stock or preferred stock, or any combination of the
foregoing, either individually or as units comprised of one or more
of the other securities.
The Company's common stock is traded on The Nasdaq Capital Market
under the symbol "SEII." On July 17, 2018, the last reported sale
price for the Company's common stock was $3.86 per share. As of
that date, the aggregate market value of the Company's outstanding
common stock held by non-affiliates was approximately $22,009,036
based on 6,457,572 shares of its outstanding common stock, of which
approximately 5,701,823 shares were held by non-affiliates.
The Company may sell these securities directly to investors,
through agents designated from time to time or to or through
underwriters or dealers.
The Company currently intends to use the net proceeds from the sale
of the securities offered under this prospectus to fund the growth
of its business, primarily working capital, and for general
corporate purposes.
A full-text copy of the preliminary prospectus is available for
free at https://is.gd/ViHNwa
About Sharing Economy
Headquartered in Jiangsu Province, China, Sharing Economy
International Inc. -- http://www.seii.com/-- through its
affiliated companies, designs, manufactures and distributes a line
of proprietary high and low temperature dyeing and finishing
machinery to the textile industry. The Company's latest business
initiatives are focused on targeting the technology and global
sharing economy markets, by developing online platforms and rental
business partnerships that will drive the global development of
sharing through economical rental business models. Moreover, the
Company will actively pursue blockchain technology in its existing
and to-be-acquired business, enabling the general public to realize
the beauty of resource sharing.
RBSM LLP's audit opinion included in the company's Annual Report on
Form 10-K for the year ended Dec. 31, 2017 contains a going concern
explanatory paragraph stating that the Company had a loss from
continuing operations for the year ended Dec. 31, 2017 and expects
continuing future losses, and has stated that substantial doubt
exists about the Company's ability to continue as a going concern.
RBSM has served as the Company's auditor since 2012.
Sharing Economy incurred a net loss of $12.92 million in 2017 and a
net loss of $11.67 million in 2016. As of March 31, 2018, the
company had $76.73 million in total assets, $9.05 million in total
liabilities and $67.67 million in total stockholders' equity.
SPEED VEGAS: Plan Funder to Buy Assets, SLV for $12MM
-----------------------------------------------------
Speed Vegas, LLC, filed a second amended disclosure statement
explaining its liquidating plan to disclose that the Plan Funder
has agreed to the terms of an asset purchase agreement that
provides in part that the Plan Funder will acquire substantially
all of the assets of the Debtor, as well as the assets of the
Debtor's wholly-owned subsidiary, SLV Automobile, LLC, for a
purchase price, inclusive of cash and assumed debt (of each of the
Debtor and SLV) in excess of $12 million.
The Plan Funder estimates the total consideration paid as exceeding
$12 million, though the estate's net cash recovery is approximately
$3.1 million plus retention of certain non- assumed claims and
causes of action of the Estate. The consideration provided by the
Plan Funder to the Debtor and SLV include:
* "cure" payment to Sloan Ventures 90, LLC (the "Landlord") of
$5,500,000;
* satisfaction of the DIP loan through the contribution of
$738,000 of the loan in exchange for an equity interest in the new
owner and the assumption of the balance of the DIP loan ($300,000
plus interest and fees) by the new owner;
* assumption by the new owner of obligations of up to $1.3
million in connection with the Debtor's principal auto financing
line;
* assumption by the new owner of obligations of up to $300,000
in connection with other, identified auto financing arrangements;
* The new owner of the assets will honor customer gift cards,
deposits and reservations, which are an estimated liability of the
Debtor of approximately $400,000.
* A $300,000 line of credit (to the new company) to fund
operations and adequate assurance of future performance.
The Second Amended Disclosure Statement also modified the
classification of claims to add one class, insurance claims,
classified in Class 6. Class 6 claims are estimated to total $126
million and will recover nothing under the Plan. Class 6 consists
of all litigation claims the holders of which have consented to
recover solely against proceeds of relevant insurance policies of
the Debtor, if any. As June 27, the only claimants in Class 6 are
the Sherwood Parties. As Class 6 Claimholders have agreed to
forego recoveries from the Debtor's estate in favor of pursuing
claims with insurance, Class 6 is deemed to reject the Plan and
Disclosure Statement.
A full-text copy of the Second Amended Disclosure Statement is
available at:
http://bankrupt.com/misc/deb17-11752-306.pdf
About Speed Vegas
Speed Vegas, LLC -- https://speedvegas.com/ -- owns a car racing
track in the Las Vegas Valley, Nevada. Speed Vegas allows guests
to drive sports cars around a custom race track: a 1.5 mile track,
with a half mile straight. Racers can choose from a multi-million
dollar collection of exotic supercars: Ferrari, Lamborghini,
Porsche, Mercedes and more.
Alleged creditors Phil Fiore, Velocita, LLC, EME Driving, LLC,
Thomas Garcia, Sloan-Speed, LLC, and T-VV, LLC, filed an
involuntary Chapter 11 petition (Bankr. D. Del. Case No. 17-11752)
against Speed Vegas on Aug. 12, 2017. The petitioning creditors
are represented by Steven K. Kortanek, Esq., at Drinker, Biddle, &
Reath LLP.
On Dec. 15, 2017, the Delaware Court converted the involuntary
bankruptcy petition to a voluntary action.
The Hon. Kevin J. Carey presides over the case.
Bielli & Klauder, LLC, is the Debtor's bankruptcy counsel.
SS BODY ARMOR: Dispute with CL&M Withdrawn from Mediation
---------------------------------------------------------
Chief Magistrate Judge Mary Pat Thynge recommends that the cases
captioned CARTER LEDYARD & MILBURN LLP, Appellant, v. S.S. BODY
ARMOR I, INC., et al., Appellees. CARTER LEDYARD & MILBURN LLP,
Appellant, v. S.S. BOY ARMOR I, INC., et al., Appellees, Civ. No.
18-349 GMS., 18-634 GMS (D. Del.) be withdrawn from the mandatory
referral for mediation and proceed through the appellate process of
the Court.
Information was obtained from counsel for the parties through a
joint letter submission to determine the appropriateness of
mediation in these matters. However, no resolution occurred and
further mediation at this stage would not be a productive exercise,
a worthwhile use of judicial resources nor warrant the expense of
the process.
The bankruptcy case is IN RE: SS BODY ARMOR I, INC., et al.,
Debtors, Bank. No. 10-11255 (CSS) (Bankr. D. Del.).
A copy of the Court's Recommendation dated June 25, 2018 is
available at https://bit.ly/2Jj2rbH from Leagle.com.
Carter Ledyard & Milburn LLP, Appellant, represented by Michael
Busenkell -- mbusenkell@gsbblaw.com -- Gellert Scali Busenkell &
Brown, LLC.
Post-Confirmation Debtor, Appellee, represented by Laura Davis
Jones -- ljones@pszjlaw.com -- Pachulski, Stang, Ziehl & Jones,
LLP.
About Point Blank
Headquartered in Pompano Beach, Florida, Point Blank Solutions,
Inc. -- http://www.pointblanksolutionsinc.com/-- designs and
produces body armor systems for the U.S. Military, Government and
law enforcement agencies, as well as select international markets.
The Company maintains facilities in Pompano Beach, Florida, and
Jacksboro, Tennessee.
The Company's former chief executive officer and chief operating
officer were convicted in September 2010 of orchestrating a $185
million fraud.
Point Blank Solutions, formerly DHB Industries, filed for Chapter
11 protection (Bankr. D. Del. Case No. 10-11255) on April 14,
2010.
Laura Davis Jones, Esq., Alan J. Kornfeld, Esq., David M.
Bertenthal, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang
Ziehl & Jones LLP, serve as bankruptcy counsel to the Debtor.
Olshan Grundman Frome Rosenweig & Wolosky LLP serves as corporate
counsel. Epiq Bankruptcy Solutions serves as claims and notice
agent.
The U.S. Trustee has appointed an Official Committee of Unsecured
Creditors and a separate Official Committee of Equity Security
Holders in the case. Ian Connor Bifferato, Esq., and Thomas F.
Driscoll III, Esq., at Bifferato LLC; and Carmen H. Lonstein, Esq.,
Andrew P.R. McDermott, Esq., and Lawrence P. Vonckx, Esq., at Baker
& McKenzie LLP, serve as counsel for the Official Committee of
Equity Security Holders. Robert M. Hirsh, Esq., and George P.
Angelich, Esq., at Arent Fox LLP, serve as counsel to the Creditors
Committee, and Frederick B. Rosner, Esq., and Brian L. Arban, Esq.,
at the Rosner Law Group LLC, serve as co-counsel.
In October 2011, the Debtors sold substantially all assets to Point
Blank Enterprises, Inc. The lead debtor changed its name to SS
Body Armor I, Inc., following the sale.
STAR MOUNTAIN: Aug. 1 Disclosure Statement Hearing
--------------------------------------------------
Judge Daniel P. Collins of the U.S. Bankruptcy Court for the
District of Arizona will convene a hearing on Aug. 1, 2018, at 9:00
a.m., to consider the adequacy of the Disclosure Statement
explaining Star Mountain Resources, Inc.'s plan of reorganization.
Any party wishing to object to the Court's approval of the
Disclosure Statement must file a written objection and that
objection must be filed by July 25, 2018.
About Star Mountain Resources
Star Mountain Resources Inc. --
http://www.starmountainresources.com/-- is a small cap mining
company focused on the acquisition of mineral properties and their
development into producing mines. It is headquartered in Tempe,
Arizona.
Star Mountain Resources sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Ariz. Case No. 18-01594) on Feb. 21,
2018. In the petition signed by Mark Osterberg, president and
chief operating officer, the Debtor estimated assets and
liabilities of $1 million to $10 million. Judge Daniel P. Collins
presides over the case. Fennemore Craig, P.C., is the Debtor's
bankruptcy counsel.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on April 18, 2018. The Committee retained
Dickinson Wright, PLLC as its legal counsel.
STARS GROUP: Fitch Hikes Rating on Sr. Sec. Credit Facility to 'BB+
-------------------------------------------------------------------
Fitch Ratings has upgraded the Stars Group, Inc.'s (TSG) senior
secured credit facility to 'BB+'/'RR1' from 'BB'/'RR2' based on the
final amount issued to refinance its existing debt and acquire Sky
Betting and Gaming. Upon closing of the transactions, TSG's
facility is sized at $5,267 million, including a $700 million
revolver, which is lower than Fitch anticipated when assigning
initial ratings to TSG on June 19, 2018. The lower first-lien
amount improves the recovery prospects for TSG's first-lien debt
and is largely a result of TSG upsizing its senior unsecured notes
issuance to $1 billion from $750 million and a larger primary
equity issuance than Fitch anticipated.
Fitch has also affirmed TSG's Long-Term Issuer Default Rating (IDR)
at 'B+'/Stable Rating Outlook and senior unsecured notes at
'B-'/'RR6'.
KEY RATING DRIVERS
Dominant Poker Platform: TSG estimates that its PokerStars online
poker platform captures a significant majority of the online poker
volume in regions where it operates. The dominant position is
reinforced by the players' gravitation towards more active
platforms that can offer more variety of games and larger
tournament payouts. PokerStars also acts as a low cost player
acquisition channel for PokerStars' casino and sports betting
segments. These segments were launched around 2015 and grew to $432
million in revenues (LTM ending March 31, 2018). The acquisition of
Sky Bet and the two sportsbook businesses in Australia (CrownBet
and William Hill Australia) will accelerate the cross selling
opportunities between the business units.
Sky Bet Acquisition Benefits: Sky Bet increases TSG's
diversification across business lines and decreases its exposure to
unregulated markets. Pro forma revenue exposure to poker, casino
and sportsbook will be 37%, 26% and 34%, respectively, and 75% of
the revenues will be attributable to regulated markets, compared to
51% prior to the acquisition. The main risk surrounding unregulated
markets is that they may develop more stringent regulations, which
can adversely affect TSG margins or may force TSG out of the
market. Sky Bet benefits from a loyal customer base (58% use Sky
Bet exclusively), branding agreement with Sky Plc and a strong
mobile platform. Negatively, exposure to the U.K. will increase as
Sky Bet is U.K. focused with pro forma U.K. exposure going up to
37%. The U.K. government said it will look to increase the Remote
Gaming Duty, now set at 15% and paid by online gaming operators, to
offset the expected decline in tax revenues from the lowering of
the maximum bets set for the fixed odds betting terminals (FOBT).
TSG factored in a potential for a tax increase when acquiring Sky
Bet although the magnitude and the timing of the potential tax
increase are unknown.
Clear Path to Deleverage: TSG's strong FCF profile will allow for
fast deleveraging. Fitch forecasts 5.4x debt/EBITDA at year-end
2019 declining to 3.9x by 2021. The recent debt incurrence was well
telegraphed to the investment community as TSG publicly was open
about seeking a large sportsbook acquisition target. Increasing
visibility into deleveraging is TSG's track record of quick debt
reduction following the acquisition of PokerStars, the new credit
facility's excess cash flow sweep and FCF/debt ratio of 6%-14%
through 2021. Liquidity profile is solid providing a clear runway
and visibility for deleveraging. There are no maturities for seven
years and no financial covenants on the term loan. TSG has a $700
million revolver with $100 drawn at closing.
Legal Overhang: TSG has a pending lawsuit with the Commonwealth of
Kentucky. A trial court awarded Kentucky $870 million relating to
the PokerStars' operations in the commonwealth in 2006-2011, a
period in which PokerStars operated illegally in U.S. TSG did not
own PokerStars during this period and will seek to recover the
ultimate damages, to the extent there are any, from the prior
owners. There is a seller's escrow account related to the 2014
PokerStars acquisition with approximately $300 million contributed
at the time of sale with TSG receiving about $6 million from the
fund to date. TSG in the meantime is appealing the award.
DERIVATION SUMMARY
TSG's closest Fitch-rated peer is GVC Holdings plc (GVC; IDR of BB+
(EXP)). GVC is a large Europe focused online gaming company but
also has land-based retail operations in U.K. GVC's pro forma
leverage is around 3x relative to TSG's pro forma leverage that is
in the mid-5x range. Companies are comparable in scale; however,
GVC is more exposed to U.K. and sports betting, while TSG is more
skewed towards poker, which it dominates. Sports betting is more
fragmented and exposed to competition. Scientific Games Corp (SGMS;
b* Issuer Default Credit Opinion) is also a relevant comparison.
SGMS has comparable business risk being a diversified global gaming
supplier with some business-to-consumer exposure. Per Fitch's 2018
forecast, SGMS leverage is around 7x and its FCF margin is weaker
at 6% as SGMS has considerable capex spending.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within its Rating Case for the Issuer
-- Annual revenue growth rate of 0% for poker, 7% for legacy
sportsbook/casino business (including the Australian acquisitions)
and 10% for Sky Bet;
-- 37% run-rate EBITDA margin taking into account 31% Sky Bet
margin;
-- FCF of approximately $470 million-$610 million with annual
income tax of $50 million-$75 million; capex of about $140 million
and interest expense of $290 million-$350 million;
-- No dividends or M&A assumed.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Debt/EBITDA below 5x;
-- Discretionary FCF margin sustaining above 15%.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Debt/EBITDA sustaining above 6x;
-- Discretionary FCF margin declining into the single digit
range;
-- TSG being ultimately liable for the Kentucky claim, with
negative rating action related to this hinging on TSG's financial
profile at the time the award is due and TSG's plan to fund the
award;
-- Sharp decline in operations perhaps related to loss of market
share in the sportsbook or casino business or an acceleration in
the decline of poker's popularity.
LIQUIDITY
Solid Liquidity: Liquidity profile is solid providing a clear
runway for deleveraging. There are no maturities for seven years,
no financial covenants on the term loan and a $700 million revolver
with $100 million drawn at closing.
FULL LIST OF RATING ACTIONS
Fitch has affirmed the following ratings:
The Stars Group Inc.
-- Long-Term Issuer Default Rating (IDR) 'B+'.
Stars Group Holdings B.V.
-- Long-Term IDR 'B+';
-- Senior unsecured notes 'B-'/'RR6'.
Stars Group (US) Co-Borrower LLC
-- Long-Term IDR 'B+'.
TSG Australia Holdings PTY LTD.
-- Long-Term IDR 'B+'.
Naris Limited
-- Long-Term IDR 'B+'.
Fitch has upgraded the following ratings:
Stars Group Holdings B.V.
-- Senior secured credit facility to 'BB+'/'RR1' from 'BB'/'RR2'.
SUBURBAN PROPANE: Moody's Alters Outlook to Stable & Affirms CFR
----------------------------------------------------------------
Moody's Investors Service, changed Suburban Propane Partners,
L.P.'s outlook to stable from negative and affirmed its Ba3
Corporate Family Rating, B1 senior notes rating, and SGL-3
Speculative Grade Liquidity Rating.
The change in the rating outlook reflects improving operating
performance and credits metrics driven by improved distribution
volumes versus the low levels witnessed in 2016-17 and reduced
partnership distributions to unit holders.
"Suburban Propane's leverage and distribution coverage could
continue improving in 2018-19 because of the increased EBITDA
contribution from its propane distribution operations," said
Arvinder Saluja, Moody's Vice President.
Outlook Actions:
Issuer: Suburban Propane Partners, L.P.
Outlook, Changed To Stable From Negative
Affirmations:
Issuer: Suburban Propane Partners, L.P.
Probability of Default Rating, Affirmed Ba3-PD
Speculative Grade Liquidity Rating, Affirmed SGL-3
Corporate Family Rating, Affirmed Ba3
Senior Unsecured Notes, Affirmed B1(LGD4)
RATINGS RATIONALE
Suburban's Ba3 CFR is supported by its significant scale and market
position in the propane distribution industry, its strong track
record of successful cost reduction efforts, and management's
historically conservative financial policies. The rating is
tempered by higher than historical leverage and low, albeit
improving, distribution coverage. Suburban is exposed to the
characteristics of the propane sector, which include a high degree
of sensitivity to unpredictable weather patterns, a trend of
secularly declining volumes, the highly competitive and fragmented
nature of the sector, and growth opportunities that are mostly
limited to acquisitions as opposed to organic growth.
Moody's expects Suburban to have adequate liquidity in 2018-19 as
reflected by its SGL-3 rating. Suburban's cash flow is largely
consumed by $150 million in partnership distributions (on a
run-rate basis) and approximately $78 million a year in interest
expense. As of March 31, 2018, Suburban had $6 million of cash and
$174 million outstanding under the $500 million secured revolver
due March 3, 2021. With $46 million of LCs outstanding that leaves
$280 million available for unexpected working capital swings and
other seasonal needs. There are no maturities until 2021, when the
revolver commitment expires. Financial covenants include a 3.0x
maximum senior secured unconsolidated leverage ratio covenant,
5.95x maximum consolidated leverage ratio (stepping down to 5.75x
in September 2018 and 5.5x in December 2018) and a 2.5x minimum
interest coverage covenant. Moody's expects the company to maintain
compliance with its financial covenants into its 2019 fiscal year,
although compliance headroom could get tight depending on seasonal
financial results and working capital borrowings.
The $525 million 5.5% senior notes due 2024, the $250 million 5.75%
senior notes due 2025, and the $350 million 5.875% senior notes due
2027 are each rated B1 or one notch below the Ba3 CFR, reflecting
their effective subordination to the (unrated) secured $500 million
revolving credit facility due 2021.
The stable outlook reflects its expectation that leverage will
further moderate through the end of fiscal 2019.
The rating could be downgraded if debt/EBITDA is sustained above 5x
(normalized for seasonal working capital related borrowings),
distribution coverage remains below 1x, or if the cushion for
compliance with the financial maintenance covenants deteriorates.
Debt funded acquisitions or distributions could result in a rating
downgrade. Moody's could consider an upgrade if debt/EBITDA remains
below 4x and distribution coverage above 1.2x.
Suburban Propane Partners, L.P. (Suburban), based in Whippany, NJ,
is a master limited partnership (MLP), which conducts operations
through three primary business segments: Propane (85% of revenues),
Fuel Oil and Refined Fuels (7%), and Natural Gas and Electricity
(5%).
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
SUPERIOR PLUS: DBRS Hikes Rating on Senior Unsecured Debt to BB
---------------------------------------------------------------
DBRS Limited upgraded Superior Plus LP's Senior Unsecured
Debentures rating to BB from BB (low) and removed the Under Review
with Positive Implications status following the completion of the
acquisition of retail propane assets in the Eastern United States
(NGL Retail East) from NGL Energy Partners LP for USD 900 million.
The acquisition price was funded through the issuance of USD 350
million and $150 million worth of senior unsecured notes. The
remainder of the acquisition price was funded via a $400 million
equity issuance and revolver drawings. There is no change to the BB
(high) Issuer Rating as a result of this announcement, and trends
on all ratings are Stable.
On June 29, 2018, DBRS placed the Senior Unsecured Debentures
rating Under Review with Positive Implications after Superior Plus
announced that the acquisition of NGL Retail East would be funded
with senior unsecured debt versus secured, as originally announced.
The upgrade of the Senior Unsecured Debentures rating is consistent
with DBRS's view that the increased size and earnings generation of
the Company is now such that the recovery of unsecured debt holders
in a hypothetical default scenario would be greater than previously
assessed. DBRS assumes that at default, using a multiple of
baseline EBITDA, recovery available to unsecured debt holders would
be between 10% and 30%, which aligns with a Recovery Rating of RR5.
This implies adjusting down the Senior Unsecured Debentures rating
by one notch compared with the Issuer Rating, as opposed to two
notches previously.
On May 31, 2018, DBRS confirmed both the Company's Issuer Rating
and Senior Unsecured Debentures rating following the announcement
that the Company had agreed to acquire NGL Retail East. The
confirmation was consistent with DBRS's view that the Company will
be able to improve leverage to a level commensurate with the
current ratings in the near term (adjusted debt-to-EBITDA below 4.0
times and cash flow-to-debt above 20%) and reflects the Company's
proven track record of successfully integrating acquisitions and
the similarity of the assets to be acquired with Superior Plus's
current operations in the Northeastern United States.
T.C. RENFROW: Can Get New Credit or Sell Property to Perform Plan
-----------------------------------------------------------------
T.C. Renfrow Land, L.P filed with the U.S. Bankruptcy Court for the
Southern District of Texas their latest disclosure statement in
connection with their second amended plan of reorganization.
The second amended plan provides that the Reorganized Debtor may,
alternatively, obtain new credit or sell real property on Miller
Road to perform the Plan. Reorganized Debtor has the authority to
either obtain new credit under or sell Miller Road free and clear
of all liens under 11 U.S.C. sections 363(b) or (f) and
1121(a)(5)(D).
The Debtor anticipates that it will pay all valid claims, in full,
out of rental income received from entities affiliated with the
Debtor, such as TC Renfrow Companies LLC. On the Effective Date,
the Debtor plans to cure all defaults. Debtor will then continue
its operations as before -- collecting rent from Mr. Renfrow's
entities and paying its obligations. The Debtor or Reorganized
Debtor reserves the right to refinance the secured claims against
its real property on Miller Road or refinance the secured claims to
pay them in full.
A full-text copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/txsb17-33540-96.pdf
A full-text copy of the Second Amended Plan is available at:
http://bankrupt.com/misc/txsb17-33540-95-1.pdf
About T.C. Renfrow L.P.
T.C. Renfrow Land L.P. holds the deed of trust on a land with house
located at 7633 Miller Road, #2, Houston, Texas, valued at $7.5
million. It separately holds the deed of trust on a land with
house located at 4035 SCR Road Rocksprings, Texas, with a current
value of $595,000.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D. Tex. Case No. 17-33540) on June 5, 2017. Timothy
C. Renfrow, manager of ACR GP, LLC, signed the petition. At the
time of the filing, the Debtor disclosed $8.13 million in assets
and $3.9 million in liabilities.
The case is assigned to Judge Marvin Isgur. The Debtor hired The
Gerger Law Firm PLLC as its legal counsel; Valbridge Property
Advisors as its valuation expert; and Richard A. Roome, P.C. as its
accountant.
THINK TRADING: Needs More Time to File Plan of Reorganization
-------------------------------------------------------------
Think Trading, Inc., and affiliates Funkytownmall.com and Salon
Supply Store, LLC, ask the U.S. Bankruptcy Court for the Southern
District of Florida to further extend until Sept. 8, 2018, the
Debtors' exclusivity period during which only the Debtors can file
a plan of reorganization.
This is Debtors' second request for an extension. The U.S. Trustee
has indicated that it does not object to the relief requested.
As reported by the Troubled Company Reporter on May 7, 2018, the
Court previously extended, at the behest of the Debtors, the
deadline for Debtors to file a Plan and Disclosure Statement, and
the exclusivity period for them to file and solicit acceptances of
same through and including July 10, 2018.
The Debtors operate a retail internet sales business consisting of
tattoo supplies and body jewelry that are sold both through "online
marketplaces," and via internet domains owned by TTI. Both pre and
post-petition, Debtors have significantly reduced overhead expenses
and, through post-petition contributions from their principals of
approximately $140,000 to date, were able to replenish their
performing inventory. Unfortunately, however, Debtors were unable
to purchase such inventory in time to market and sell same during
the 2018 "tattoo season" (to wit, the cold weather months). As a
result, management had been unable to prepare reliable financial
projections beyond the end of this fiscal year.
In addition, due to certain personal issues that undersigned
counsel can advise the court and other interested parties ore tenus
at a hearing on this Motion, it is anticipated that additional time
is needed to finalize financial projections, continue negotiations
regarding obtaining capital
to fund a plan, and to allow sufficient time to draft a formal plan
and disclosure statement.
TTI is 100% owned by Gustavo and Mariela Mitchell. In turn, TTI
owns and
operates FTM, together with related non-debtor entity, Tattoo Mogul
LLC. The Debtors were successful for several years while operating
out of a relatively small facility. After expanding into larger
facility and hiring additional staff, cash-flow was insufficient to
meet the increased operating expenses. Debtors eventually did not
have sufficient cash-flow to purchase new inventory, which led to
decreased sales and defaults under several credit lines. The
Debtors filed Chapter 11 primarily to take advantage of the
automatic stay.
Since filing for Chapter 11, the Debtors have made significant
progress in their reorganization efforts, including implementing
numerous cost-reduction measures and stabilizing operations,
reaffirming relationships with key suppliers and service providers,
and generally administering these Chapter 11 cases efficiently and
economically.
Mr. and Mrs. Mitchell have already invested approximately $140,000
in post-petition funding to purchase new inventory. However, due
to the timing of those purchases (and the unavoidable delays in
receiving the inventory from overseas suppliers), the Debtors were
not able to market, or sell, the inventory in time for the 2018
tattoo season.
Due to the loss of sales revenue during the 2018 tattoo season, and
other unforeseen personal issues, additional time is now required
to determine accurate financial projections) in conjunction with a
plan of reorganization, to determine the best course of action to
facilitate maximum distributions to creditors of TTI and FTM, and
for undersigned counsel to prepare a plan and disclosure statement.
The Debtors have made significant progress under Chapter 11,
including stabilizing their businesses, reaffirming relationships
with key suppliers and service providers, implementing
cost-reduction measures, and generally administering the chapter 11
cases efficiently and economically. The Debtors are not seeking
the extension of the Exclusive Periods as a negotiation tactic, to
artificially delay the conclusion of these Chapter 11 cases, or to
hold creditors hostage to an unsatisfactory plan proposal. To the
contrary, this request is intended to maintain a framework
conducive to an orderly, efficient, and cost-effective confirmation
process while enabling Salon Supply to consummate an auction sale
without the distractions and costs attendant to potentially
competing plans of reorganization. The requested extensions are
necessary to complete the Salon Supply auction and proceed to the
next stage of these chapter 11 cases in an orderly and efficient
manner.
The Debtors assure the Court that TTI and FTM are current on
payment of their post-petition obligations and have sufficient
liquidity to pay their undisputed administrative expenses in the
ordinary course, and it has been determined that SSS is
administratively insolvent and will only have sufficient funds to
pay administrative claims and, in part, the secured claim of
FTM’s primary creditor, JP Morgan Chase Bank. As such, the
requested extension will not prejudice the legitimate interests of
creditors, and this factor weighs in favor of allowing Debtors to
extend the Exclusive Periods.
The Debtors say that given the size and complexity of the case,
Debtors'
unresolved contingencies, and Debtors’ ongoing and realistic
efforts to obtain financing to fund a plan of reorganization, it is
reasonable to extend the exclusive period to formulate and finalize
a plan of reorganization for an additional thirty (30) days.
A copy of the Debtors' request is available at:
http://bankrupt.com/misc/flsb17-24767-99.pdf
About Think Trading
Think Trading Inc. -- https://thinktradinginc.com/ -- is a
distribution e-commerce company with multiple online storefronts,
marketplace operations and over 14,000 products. It provides
wholesale and retail sales of products in various industries.
Based in Palm Beach Gardens, Florida, Think Trading is housed in a
60,000-foot warehouse where all inventory, packaging, and shipping
is housed and handled. It was founded in 2001 and has more than 50
employees.
Think Trading's affiliate Funkytownmall.com, Inc., offers a
selection of body jewelry online while Salon Supply Store LLC, a
company based in Palm Beach Gardens, Florida, provides its
customers with a variety of salon equipment and beauty supplies
ranging from popular nail polish brands to spray tanning machines
and salon furniture.
Think Trading, Funkytownmall.com and Salon Supply Store sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Fla. Case Nos. 17-24767 to 17-24769) on Dec. 12, 2017. The cases
are jointly administered under Case No. 17-24767.
In the petitions signed by Gustavo Mitchell, president of Think
Trading and FunkytownMall.com, Think Trading and FunkytownMall.com
estimated assets of less than $50,000 and liabilities of less than
$1 million, and Salon Supply estimated assets of less than $50,000
and liabilities of $1 million to $10 million.
Judge Erik P. Kimball presides over the cases.
The Debtors hired Lubliner Kish PLLC as Chapter 11 counsel. The
Debtors also hired Jeffrey Pasternack, and the firm of Pasternack
Associates LLC, to provide accounting and bookkeeping services to
their bankruptcy estates.
TORRADO CONSTRUCTION: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: Torrado Construction Company, Inc.
3311-13 East Thompson Street
Philadelphia, PA 19134
Business Description: Torrado Construction Company, Inc. --
http://torradoconstruction.com-- is
a privately held general construction firm
specializing in commercial construction,
renovations and rehabilitations, concrete,
removal services and painting services.
Torrado Construction was established in 1995
by Luis E. Torrado and is headquartered in
Philadelphia, Pennsylvania.
Chapter 11 Petition Date: July 18, 2018
Court: United States Bankruptcy Court
Eastern District of Pennsylvania (Philadelphia)
Case No.: 18-14736
Judge: Hon. Jean K. FitzSimon
Debtor's Counsel: Albert A. Ciardi, III, Esq.
CIARDI CIARDI & ASTIN, P.C.
One Commerce Square
2005 Market Street, Suite 3500
Philadelphia, PA 19103
Tel: (215) 557-3550
Fax: 215-557-3551
E-mail: aciardi@ciardilaw.com
- and -
Nicole Marie Nigrelli, Esq.
CIARDI CIARDI & ASTIN, P.C.
One Commerce Square, Suite 3500
Philadelphia, PA 19103
Tel: 215 - 557-3550
E-mail: nnigrelli@ciardilaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Luis E. Torrado, president.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at:
http://bankrupt.com/misc/paeb18-14736_creditors.pdf
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/paeb18-14736.pdf
TRIBUNE CO: Judge Pushes Settlement Talks in LBO Court Fight
------------------------------------------------------------
Peg Brickley, writing for The Wall Street Journal Pro Bankruptcy,
reported that ten years after newspaper publisher Tribune Media Co.
defaulted on billions of dollars in debt, a federal judge is
pushing for settlement talks between big shareholders that cashed
out in a leveraged buyout and creditors that were burned in the
bankruptcy that followed.
According to the report, the push came from Judge Richard Sullivan,
a New York federal judge presiding over the $8 billion Tribune LBO
lawsuit, a classic of the bankruptcy genre, in which creditors say
the deal that enriched shareholders doomed them and publisher.
After years of wins and losses for both sides, the case is no
closer to trial, and Judge Sullivan is trying to drive peace talks,
the report related. On July 9, he received a 21-page letter from
lawyers caught up in the litigation, who generally agree mediation
or settlement talks may be in order, but maybe not right now, the
report said.
"I was curious about how close we are to the end. It doesn’t
sound like we are very close," Judge Kevin Carey commented at a
hearing on July 10, the report said. He has presided over
Tribune's bankruptcy case since 2008 and was warned he might have
to keep the proceeding alive for years to come, the report further
related.
The latest legal twist is a U.S. Supreme Court ruling that may have
closed a bankruptcy loophole that shareholders counted on to shield
their profits from creditor clawbacks, the report pointed out. The
decision overturned standing law in New York and said that merely
passing money through banks does not shield deals from legal
attack, the report said.
About Tribune Co.
Chicago, Illinois-based Tribune Co. -- http://www.tribune.com/--
and 110 of its affiliates filed for Chapter 11 protection (Bankr.
D. Del. Lead Case No. 08-13141) on Dec. 8, 2008. The Debtors
proposed Sidley Austin LLP as their counsel; Cole, Schotz, Meisel,
Forman & Leonard, PA, as Delaware counsel; Lazard Ltd. and Alvarez
& Marsal North America LLC as financial advisors; and Epiq
Bankruptcy Solutions LLC as claims agent. As of Dec. 8, 2008, the
Debtors listed $7,604,195,000 in total assets and $12,972,541,148
in total debts. Chadbourne & Parke LLP and Landis Rath LLP served
as co-counsel to the Official Committee of Unsecured Creditors.
AlixPartners LLP served as the Committee's financial advisor.
Landis Rath Moelis & Company served as the Committee's investment
banker. Thomas G. Macauley, Esq., at Zuckerman Spaeder LLP, in
Wilmington, Delaware, represented the Committee in connection with
the lawsuit filed against former officers and shareholders for the
2007 LBO of Tribune.
Protracted negotiations and mediation efforts and numerous proposed
plans of reorganization filed by Tribune Co. and competing creditor
groups delayed Tribune's emergence from bankruptcy. Many of the
disputes among creditors center on the 2007 leveraged buyout
fraudulence conveyance claims, the resolution of which is a key
issue in the bankruptcy case.
Judge Kevin J. Carey issued an order dated July 13, 2012,
overruling objections to the confirmation of Tribune Co. and its
debtor affiliates' Plan of Reorganization. In November 2012,
Tribune received approval from the Federal Communications
Commission to transfer media licenses, one of the hurdles to
implementing the reorganization plan. Aurelius Capital Management
LP failed in halting implementation of the plan pending appeal.
Tribune Co. exited Chapter 11 protection Dec. 31, 2012, ending four
years of reorganization. The reorganization allowed a group of
banks and hedge funds, including Oaktree Capital Management and
JPMorgan Chase & Co., to take over the media company.
TRIUMPH GROUP: Moody's Cuts CFR to B3 & Alters Outlook to Negative
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Triumph Group,
Inc., including the Corporate Family Rating to B3 from B2, the
Probability of Default Rating to B3-PD from B2-PD, and the senior
unsecured notes to Caa1 from B3. The rating outlook has been
changed to negative from stable.
The following summarizes Moody's's rating actions:
Issuer: Triumph Group, Inc.
Corporate Family Rating, downgraded to B3 from B2
Probability of Default Rating, downgraded to B3-PD from B2-PD
Speculative Grade Liquidity Rating, affirmed SGL-4
$375 million senior unsecured notes due 2021, downgraded to Caa1
(LGD4) from B3 (LGD4)
$300 million senior unsecured notes due 2022, downgraded to Caa1
(LGD4) from B3 (LGD4)
$500 million senior unsecured notes due 2025, downgraded to Caa1
(LGD4) from B3 (LGD4)
Outlook, changed to Negative from Stable
RATINGS RATIONALE
The downgrade reflects Moody's expectations that earnings and cash
generation during FY 2019 will be weaker than previously
anticipated (relative to guidance provided in July 2017). This will
result in a strained set of credit metrics and very high financial
leverage with Moody's adjusted Debt-to-EBITDA (includes 4x of
pension adjustments) anticipated to remain around 10x or higher for
the balance of this year. The downgrade also incorporates Moody's
expectations of weak liquidity through 2019 with significant cash
burn and a heavy reliance on external sources of financing.
Notably, free cash flow is likely to be negative by almost $200
million during FY 2019 (inclusive of repayments of previously
disclosed advances, exclusive of additonal advance payments and any
additional divestiture activity), and this follows the negative
free cash flow of $330 million in FY 2018.
The ratings, including the B3 CFR, balance Triumph's considerable
scale and well-established presence as an aerospace supplier
against the company's highly leveraged balance sheet, poor earnings
profile, tight liquidity, and declines in operating performance.
Moody's anticipates a weak set of credit metrics for the balance of
FY 2019 and continuing into FY 2020 as the company faces on-going
earnings pressures, primarily in its structures segment. Moody's
recognizes the benefits of Triumph's restructuring programs as well
as initiatives to de-risk platforms such as the Bombardier 7500
along with the previously announced transfer of work for the G650
and E-Jet from higher cost facilities to outside parties. These
efforts should reduce its cost structure. However, the high
execution risk associated with the simultaneous transfer of work on
a number of key platforms while traveling down the learning curve
on developing programs act as tempering considerations
Previous topline pressures from the winding down of legacy
platforms appear to be abating and Moody's anticipates organic
sales growth in the low to mid-single-digits into 2019. Visibility
into sustainable margin levels is complicated by a noisy earnings
profile involving multiple, large-sized EBITDA adjustments as well
as on-going restructuring and divestiture programs and the impact
of accounting changes. Uncertainty regarding recurring levels of
profitability on the 7500 and E-Jet act as additional complicating
factors. Triumph's on-going multi-year restructuring program ($300
million of savings targeted by FY 2019) and the renewed focus on
improving operational execution on underperforming programs are
viewed favorably and could support EBITDA margins growing to the
low double-digits over the intermediate term.
The SGL-4 liquidity rating denotes expectations of weak liquidity
over the next twelve months. The liquidation of advance customer
payments ($250 million received in December 2017) along with
sizable working capital investments will result in a substantial
use of cash over the next few quarters. Moody's expects free cash
flow to be negative to the tune of around $200 million during FY
2019 (inclusive of repayments of previously disclosed advances,
exclusive of additonal advance payments and any additional
divestiture activity). External liquidity is provided by an $800
million revolving credit facility due May 2021 as well as a $125
million Accounts Receivables (A/R) facility due November 2020.
Given Moody's expectation of negative free cash flow over the next
4 to 6 quarters, Moody's anticipates heavy reliance on both
facilities through FY 2020. The revolver contains two
maintenance-based financial covenants: a senior secured leverage
ratio of 3.5x and an interest coverage ratio of 2.75x. Moody's
notes that compliance with the interest coverage ratio will be very
tight over the next few quarters, and absent covenant relief, the
company runs the risk of breaching this covenant.
The negative outlook considers Triumph's near-term earnings
pressures, elevated execution risk, as well as concerns that the
company will struggle to show a sustained improvement in its
underlying earnings and cash flow generation.
An upgrade in the near term is unlikely given Triumph's high
financial leverage and weak cash flows. Any upgrade would be
predicated on expectations of an improved liquidity profile such
that FCF/Debt was expected to remain at least in the low
single-digits along with reduced reliance on revolver borrowings.
The ratings could be upgraded if Triumph were to sufficiently lower
leverage such that Debt-to- EBITDA on a Moody's adjusted basis was
expected to be sustained below 7.5x. A demonstrated ability to
execute on the previously announced transition of work relating to
the G650 and E-Jet would also be important considerations for an
upgrade, along with an ability to generate consistent profits and
cash from the retained business.
The ratings could be downgraded if Triumph's liquidity profile were
to weaken further or if the company is not on a trajectory to
restore meaningfully positive free cash flow. Downward rating
pressure could arise if there are unanticipated production rate
cuts or operating issues in any of Triumph's existing platforms or
if there cost overages relating to new programs or delays in
transferring work on the G650 and E-Jet.
Triumph designs, engineers, manufactures, repairs, overhauls and
distributes a broad portfolio of aero-structures, aircraft
components, accessories, subassemblies and systems. The company
serves commercial aerospace (57% of sales), military (21%),
business jet (19%) and regional and other markets (3%). Revenues
were approximately $3.2 billion for the twelve months ended March
31, 2018.
UGHS SENIOR: Bankr. Court Disallows Donald Sapaugh's Claims
-----------------------------------------------------------
Judge Marvin Isgur of the U.S. Bankruptcy Court for the Southern
District of Texas orders that Donald W. Sapaugh may not amend proof
of claim No. 20-1 filed in the UGHS Senior Living, Inc. case.
Sapaugh's claims against the estate are disallowed.
Sapaugh filed two proofs of claim in the bankruptcy cases of the
Senior Living entities. Claim 20-1 was filed in the UGHS Senior
Living, Inc. case and seeks the repayment of $189,495.01 owed to
Community Bank of Texas. Sapaugh filed Claim 22-1 on February 9,
2018, in the UGHS Senior Living, LLC case in order to amend his
previously filed proof of claim and provide supporting
documentation for his claim. However, Claim 22-1 was submitted
after the April 11, 2016 claims bar date had passed.
The Court finds that Sapaugh's late-filed proof of claim and
supplementary information fail to indicate whether money from the
renewed loan was procured or used for the benefit of UGHS Senior
Living, LLC or other Senior Living entities. Accordingly, without
sufficient evidence to conclude that the loan was procured for the
benefit of Senior Living, LLC, allowing Sapaugh to amend his proof
of claim would prove futile since Senior Living, LLC had no
liability for the loan renewal.
A full-text copy of the Court's Memorandum Opinion dated June 24,
2018 is available at:
http://bankrupt.com/misc/txsb15-80399-430.pdf
A full-text copy of the Court's Order dated June 24, 2018 is
available at:
http://bankrupt.com/misc/txsb15-80399-429.pdf
About UGHS Senior Living Inc.
Based in Friendswood, Texas, UGHS Senior Living, Inc., and its
affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D.
Tex. Lead Case No. 15-80399) on Nov. 10, 2015. The petition was
signed by Chad J. Shandler, chief restructuring officer.
UGHS estimated assets of less than $50,000 and liabilities of $1
million and $10 million. TrinityCare Senior Living LLC, one of the
debtors, estimated assets of $1 million and $10 million and
liabilities of less than $500,000.
Judge Letitia Z. Paul presides over the cases. John F Higgins, IV,
Esq., and Aaron James Power, Esq., at Porter Hedges LLP serve as
the Debtors' bankruptcy counsel. The Debtors hired CohnReznick LLP
as their accountant.
UGHS SENIOR: Court Allows E. Laborde $160K Unsecured Claim
----------------------------------------------------------
University General Health System Senior Living, Inc. and several of
its affiliates filed for chapter 11 bankruptcy on Nov. 11, 2015.
Edward T. Laborde, Jr., a member of Senior Living's board of
directors, filed a proof of claim in Senior Living's bankruptcy
case asserting the right to indemnification for $160,833 in
payments Laborde purports he made on behalf of Senior Living during
legal proceedings with creditors. The Liquidating Trustee, Chad J.
Shandler, objected to Laborde's claim, arguing that indemnification
is inappropriate.
Upon analysis, Bankruptcy Judge Marvin Isgur granted Labordes's
unsecured claim arising out of his indemnification rights.
Although the Trustee disputes whether UGHS is liable to Laborde, he
does not argue that Laborde failed to comply with the permissive
indemnification standards under Texas law. LaBorde's actions
satisfied the statutory requirements for permissive indemnity,
supporting his right to indemnification. Additionally, both the
Senior Living articles of incorporation and Laborde's employment
agreement allow for indemnification to the extent permitted by
applicable law. Accordingly, Laborde's indemnity is consistent with
the intent of the employment agreement because Laborde acted within
the bounds of Texas law, even without an explicit request for
defense.
Thus, Laborde's unsecured claim in the amount of $160,833 against
UGHS Senior Living, Inc. is allowed.
A full-text copy of the Court's Memorandum Opinion dated June 27,
2018 is available at:
http://bankrupt.com/misc/txsb15-80399-432.pdf
A full-text copy of the Court's Order is dated June 27, 2018 is
available at:
http://bankrupt.com/misc/txsb15-80399-431.pdf
About UGHS Senior Living Inc.
Based in Friendswood, Texas, UGHS Senior Living, Inc., and its
affiliates filed for Chapter 11 bankruptcy protection (Bankr. S.D.
Tex. Lead Case No. 15-80399) on Nov. 10, 2015. The petition was
signed by Chad J. Shandler, chief restructuring officer.
UGHS estimated assets of less than $50,000 and liabilities of $1
million and $10 million. TrinityCare Senior Living LLC, one of the
debtors, estimated assets of $1 million and $10 million and
liabilities of less than $500,000.
Judge Letitia Z. Paul presides over the cases. John F Higgins, IV,
Esq., and Aaron James Power, Esq., at Porter Hedges LLP serve as
the Debtors' bankruptcy counsel. The Debtors hired CohnReznick
LLP
as their accountant.
US SECURITY ASSOCIATES: S&P Puts Ratings on Watch Negative
----------------------------------------------------------
S&P Global Ratings placed its ratings on U.S. Security Associates
Holdings Inc. on CreditWatch with negative implications. The action
follows the company's announcement that it has entered into an
agreement to be acquired by Allied Universal Topco LLC for
approximately $1 billion.
S&P expects that all of U.S. Securities Associates debt, including
its $80 million senior secured revolving credit facility due in
2021 and its $575 million senior secured term loan due in 2023,
will be repaid when the transaction closes.
The negative CreditWatch placement follows the announcement that
lower-rated Allied Universal Topco LLC, the largest provider of
manned security services in the United States, plans to acquire
U.S. Security Associates Holdings Inc., the fourth largest company
in the market, for about $1 billion. S&P's ratings on Allied
Universal Topco LLC incorporates the company's high debt leverage
(around 12x as of the twelve months ended March 31, 2018), its
aggressive financial policies under financial sponsor ownership,
and its recent history of higher than expected integration costs
and operational headwinds following its merger with Allied Barton
in 2016.
S&P said, "We expect to resolve the CreditWatch listing by
withdrawing all ratings on U.S. Security Associates once the merger
has been completed and its debt has been repaid. In the unlikely
event that the transaction isn't completed, we would expect to
affirm our 'B' corporate credit rating on the company."
VERRA MOBILITY: Moody's Affirms B2 CFR & Cuts Term Loan to B2
-------------------------------------------------------------
Moody's Investors Service affirmed Verra Mobility Corporation's
Corporate Family Rating (CFR) of B2 and Probability of Default
Rating (PDR) of B2-PD. Concurrently, Moody's downgraded the rating
for the senior secured first lien term loan (to B2 from B1). The
rating outlook remains stable.
The affirmation follows the announcement that Verra Mobility will
be merging with Gores Holdings II, Inc. (Gores), a publicly traded
special purposes acquisition company. Gores will use $400 million
of cash on its balance sheet and $400 million of new equity raised
via a PIPE offering to fund the cash equity consideration, partial
repayment of the $200 million second lien term loan, and
transaction fees. Verra Mobility will issue an incremental $70
million first lien term loan with proceeds applied towards repaying
the remainder of the $200 million second lien term loan. Verra
Mobility will seek to amend the change of control provisions of its
credit agreements so that the existing debt can remain. Affiliates
of Platinum Equity will remain the company's largest shareholder
but have less than a majority ownership stake. Closing of the
acquisition is subject to Gores' shareholder approval.
The affirmation of the B2 CFR acknowledges that the transaction
benefits the company's credit profile since debt will be reduced by
$130 million but that debt/EBITDA will remain at a level that is
supportive of the B2 rating. The downgrade of the senior secured
first lien term loan to B2, the same level as the CFR, reflects the
proposed repayment in full of the second lien term loan and the
first lien term loan's resulting position as the preponderance of
the remaining debt. The company also has an ABL revolver due 2023
(unrated) that has a priority claim with respect to the relatively
more liquid assets including accounts receivable and inventory.
Downgrades:
Issuer: Verra Mobility Corporation
Gtd Senior Secured First Lien Term Loan, Downgraded to B2 (LGD4)
from B1 (LGD3)
Outlook Actions:
Issuer: Verra Mobility Corporation
Outlook, Remains Stable
Affirmations:
Issuer: Verra Mobility Corporation
Probability of Default Rating, Affirmed B2-PD
Corporate Family Rating, Affirmed B2
Certain parent companies including Gores Holdings II, Inc. are not
expected to guarantee the borrower's debt, and therefore
maintenance of the credit ratings going forward will be subject to
continuing receipt of sufficient financial information for the
borrower.
The following rating at Verra Mobility Corporation remains
unchanged and will be withdrawn upon the repayment in full of this
bank credit facility:
Gtd Senior Secured Second Lien Term Loan of Caa1 (LGD6)
RATINGS RATIONALE
Verra Mobility's B2 CFR broadly reflects the company's solid EBITDA
margins of roughly 50% and its high free cash flow conversion given
its relatively low capital needs. The company is well positioned
within its two niche markets, tolling solutions and safety cameras.
Verra Mobility's competitive position benefits from existing
connectivity with over 50 tolling authorities that cover a large
portion of toll roads in the US and direct integration with
hundreds of ticket issuing authorities. The acquisition of Highway
Tolling Administration (HTA) in March 2018 meaningfully bolstered
Verra Mobility's scale and market position as a key tolling
solutions supplier to car rental companies. The acquisition of Euro
Parking Collection in April 2018 provides the company with an
established platform from which it can expand its tolling solutions
in Europe. Following these acquisitions, the tolling solutions
segment represents a majority of revenue. The tolling business has
favorable demand characteristics as use of cashless tolling and
toll road traffic increase. Within the company's safety segment,
softness in the company's largest product category, red light
cameras, has been somewhat offset by growth in other products such
as speed safety solutions. The credit profile is supported by Verra
Mobility's good revenue visibility given its multi-year contracts
and installed base of more than 4,000 cameras.
The credit profile is constrained by high leverage, a small revenue
base, and high customer concentration. Pro forma for the
transaction, debt/EBITDA measures roughly 5x. While Verra Mobility
is well positioned in its markets, its pro forma revenue base is
relatively small measuring roughly $350 million. The safety segment
is less susceptible to macroeconomic conditions, but is subject to
legislation allowing for cameras. The company's high customer
concentration is partially mitigated by multi-year contracts and
the embedded nature of its devices and services in the operations
of its customers. Its top three customers in the fleet and tolling
business account for roughly four fifths of segment revenue and its
top ten municipal customers account for over two fifths of safety
segment revenue.
Moody's anticipates that Verra Mobility will maintain very good
liquidity over the next 12 months supported by positive free cash
flow and availability under a $75 million ABL revolver due 2023.
The borrowing base currently limits access to less than the full
commitments.
The stable rating outlook reflects Moody's expectation for modest
revenue and EBITDA growth over the next 12-18 months supporting
reduction in debt/EBITDA towards the mid-4x area.
Factors that could support an upgrade include debt/EBITDA sustained
below 4x, financial policies supportive of this leverage level and
clarity around financial policies given the new ownership
structure, free cash flow to debt sustained in the high single
digits, successful integration of acquisitions, and further
customer diversification.
Factors that could result in a downgrade include debt/EBITDA above
6x, EBITA/interest approaching 1.25x, loss of a significant
customer, deterioration in liquidity, or debt-funded acquisitions
or dividends.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Verra Mobility, headquartered in Mesa, Arizona, is a
technology-enabled services company providing toll, violation
management, and title and registration services for rental car and
fleet management companies and road safety cameras for
municipalities.
WACHUSETT VENTURES: Has Until July 25 to Exclusively File Plan
--------------------------------------------------------------
The Hon. Patrick M. Flatley of the U.S. Bankruptcy Court for the
Northern District of West Virginia has extended Protea Biosciences,
Inc., and Protea Biosciences Group, Inc.'s exclusive periods during
which only the Debtors can file a plan of reorganization and
solicit acceptance of the plan through and including Oct. 2, 2018,
and Dec. 2, 2018, respectively.
A copy of the court order is available at:
http://bankrupt.com/misc/wvnb17-01200-287.pdf
As reported by the Troubled Company Reporter on June 19, 2018, the
Debtors asked the Court to extend the exclusive periods for the
Debtors to file and obtain acceptance of a plan for a period of 90
days. The Debtors' are in the process of finalizing a possible
transaction that could form the basis of the Debtors' plan. The
Debtors need additional time to consummate the transaction which
the Debtors currently believe could yield the highest and best
return for the creditors. The Debtors anticipate filing a motion
to approve the proposed transaction in the very near future. The
Debtors are also investigating potential litigation claims which
may impact proposed reorganization plan.
About Protea Biosciences
Headquartered in Morgantown, West Virginia, Protea Biosciences Inc.
-- https://www.proteabio.com/ -- is a bioanalytics technology
company that provides analytical and diagnostic solutions for the
rapid and direct identification, mapping and display of the
molecules present in living cells and biological samples.
Protea Biosciences, Inc., and its affiliate Protea Biosciences
Group, Inc., sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. W.Va. Case Nos. 17-01200 and 17-01201) on Dec. 1,
2017.
At the time of the filing, Protea Biosciences disclosed $5.16
million in assets and $13.64 million in liabilities. Protea
Biosciences Group disclosed $2.7 million in assets and $18.2
million in liabilities.
Judge Patrick M. Flatley presides over the case.
The Debtors hired Buchanan Ingersoll & Rooney PC as their legal
counsel; and Compass Advisory Partners, LLC, as their restructuring
advisor.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' cases. Leech Tishman Fuscaldo
& Lampl, LLC, is the Committee's legal counsel and Johnson Law,
PLLC, is its local counsel.
WIT'S END RANCH: $3.7M Sale of Denver Property to IH Approved
-------------------------------------------------------------
Judge Joseph G. Rosania of the U.S. Bankruptcy Court for the
District of Colorado authorized Wit's End Ranch Retreat, LLC's sale
of the real property commonly known as 3206 Osage Street, Denver,
Colorado to IH Holdings Twelve, LLC for $3.7 million.
The sale is free and clear of all Liens.
Upon closing of the Sale, the Sale proceeds will be paid in the
following order: (i) a 4% commission to Pinnacle: (ii) all proceeds
from the sale net of the usual and customary closing costs and the
B&G Payment will be paid to 1st Creek Properties, LLC at the time
of the closing in partial satisfaction of its claims against the
Debtor; and (iii) all other monies will be held by Buechler &
Garber, LLC to be distributed pursuant to further Order of the
Court.
All unexpired leases and executory contracts related to the Osage
property remain rejected pursuant to the Court's prior Order
entered May 4, 2017.
To any extent necessary under Bankruptcy Rule 9014 and Rule 54(b)
of the Federal Rules of Civil Procedure, as made applicable by
Bankruptcy Rule 7054, the Court expressly finds that there is no
just reason for delay in the implementation of the Order, and
expressly directs the entry judgment as set forth in the Order.
The Order constitutes a final order within the meaning of 28 U.S.C.
section 158(a). Notwithstanding Bankruptcy Rules 6004 and 6006,
the effectiveness of the order will not be stayed and the Order
will be effective immediately.
About Wit's End Ranch Retreat
Glenn, Colorado-based Wit's End Ranch Retreat, LLC, sought Chapter
11 protection (Bankr. D. Colo. Case No. 17-18893) on Sept. 25,
2017, estimating under $1 million in both assets and liabilities.
Judge Joseph G. Rosania Jr. presides over the case. The Debtor
hired Buechler & Garber, LLC, as bankruptcy counsel, and Carolin
Topelson Law, LLC, as special counsel.
WOLVERINE WORLD: Moody's Hikes CFR to Ba1 & Unsec. Notes to Ba2
---------------------------------------------------------------
Moody's Investors Service upgraded Wolverine World Wide, Inc.'s
ratings, including its Corporate Family Rating to Ba1 from Ba2,
Probability of Default Rating to Ba1-PD from Ba2-PD. Moody's also
upgraded the Company's Senior Unsecured Notes due 2026 to Ba2 from
Ba3. The Company's Speculative Grade Liquidity Rating was affirmed
at SGL-1. The rating outlook is stable.
"The upgrade reflects our expectation for continued improvement in
operating performance and credit metrics over the next 12-18
months" said Moody's lead apparel analyst, Mike Zuccaro. Having
completed its Way Forward transformation and restructuring
initiatives, Wolverine activated its new Global Growth Agenda in
early 2018, focusing on three key elements including product
innovation and design, enhancing its digital-direct offense, and
international growth. Zuccaro added, "despite plans to increase
investment between $40 million and $45 million in 2018, we expect
Wolverine to drive continued revenue and profit growth that,
together with positive free cash flow and lower debt levels, should
lead to further improvement in credit metrics."
Upgrades:
Issuer: Wolverine World Wide, Inc.
Corporate Family Rating, Upgraded to Ba1 from Ba2
Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD
Senior Unsecured Notes due 2026, Upgraded to Ba2 (LGD5) from Ba3
(LGD5)
Outlook Actions:
Issuer: Wolverine World Wide, Inc.
Outlook, Remains stable
Affirmations:
Issuer: Wolverine World Wide, Inc.
Speculative Grade Liquidity Rating, Affirmed SGL-1
RATINGS RATIONALE
Wolverine's Ba1 Corporate Family Rating reflects its meaningful
scale in the global footwear industry and its sizable portfolio of
brands which appeal to a broad range of consumer needs. The rating
also reflects the Company's moderate financial leverage with
lease-adjusted debt to EBITDA of 3.4x as of March 31, 2018 and very
solid EBITA to interest coverage of 5.75x, both of which have
significantly improved since the end of 2016 following that year's
challenging economic conditions, inventory overhang and foreign
currency pressures. The Company has returned to positive underlying
revenue growth while improving profit margins following its
strategic realignment and the Wolverine Way Forward
transformational plans, and debt has declined by over $570 million
since the end of 2012. Liquidity is very good, supported by balance
sheet cash, positive free cash flow and ample availability under
its revolving credit facility; although its unrated Senior Secure
Revolver and Term Loan are set to mature in July 2020. Wolverine's
credit profile is constrained by its narrow product focus in the
footwear segment, and greater degree of fashion risk for certain
brands such as Sperry.
The stable rating outlook reflects Moody's expectation for stable
revenue and profit growth over the next 12-18 months. In addition,
while acquisitions will likely be a part of the Company's growth
strategy, Moody's expects that the Company will look to maintain
moderate debt and leverage over time.
While not likely over the near-to-intermediate term given its small
revenue scale and narrow product focus, over time, Wolverine's
ratings could be upgraded if it were to sustainably reduce
financial leverage through further debt reduction and profitable
growth. An upgrade would also require increased diversification via
international expansion, or an expanded portfolio of brands or
products. Quantitatively, ratings could be upgraded if adjusted
debt/EBITDA was sustained below 3.0 times, EBITA/Interest above
5.0x, and FFO/Net Debt above 35%.
Ratings could be downgraded if the Company were to see a meaningful
decline in operating performance, or if the Company were to
undertake more aggressive financial policies such as a sizable
debt-financed acquisitions or share repurchases. A downgrade could
also occur if liquidity were to weaken, such as an inability to
refinance bank debt well ahead of the obligations becoming current.
Quantitatively, ratings could be downgraded if lease-adjusted
debt/EBITDA was sustained above 3.5x or EBITA to interest coverage
below 4.0x.
Wolverine is a marketer of branded casual, active lifestyle, work,
outdoor sport, athletic, children's and uniform footwear and
apparel. The Company's portfolio of brands includes: Merrell,
Sperry, Hush Puppies, Saucony, Wolverine, Keds, Chaco, Bates,
HYTEST, Stride Rite and Soft Style. The Company also is the global
footwear licensee of the popular brands Cat and Harley-Davidson.
The Company's products are carried by leading retailers in the U.S.
and globally in approximately 200 countries and territories.
WOODBRIDGE GROUP: Bankr. Court Corrects Errors in June 20 Opinion
-----------------------------------------------------------------
Bankruptcy Judge Kevin J. Carey corrects certain typographical
errors found in the Opinion and the accompanying Order issued on
June 20, 2018.
The dates at the end of the Opinion (page 14) and the end of the
accompanying Order (page 3) are amended to strike the dates as
written [June 20, 2017], and replace each with the correct date:
June 20, 2018.
The bankruptcy case is in re: WOODBRIDGE GROUP OF COMPANIES, LLC,
et al., Chapter 11, Debtors, Case No. 17-12560 (KJC) (Bankr. D.
Del.).
A full-text copy of the Court's Order dated June 25, 2018 is
available at https://bit.ly/2NPSA0z from Leagle.com.
A full-text copy of the Court's Opinion dated June 20, 2018 is
available at https://bit.ly/2LaihHi from Leagle.com.
About Woodbridge Group
Headquartered in Sherman Oaks, California, The Woodbridge Group
Enterprise -- http://www.woodbridgecompanies.com/-- is a
comprehensive real estate finance and development company. Its
principal business is buying, improving, and selling high-end
luxury homes. The Woodbridge Group Enterprise also owns and
operates full-service real estate brokerages, a private investment
company, and real estate lending operations. The Woodbridge Group
Enterprise and its management team have been in the business of
providing a variety of financial products for more than 35 years,
and have been primarily focused on the luxury home business for the
past five years. Since its inception, the Woodbridge Group
Enterprise has completed more than $1 billion in financial
transactions. These transactions involve real estate, note buying
and selling, hard money lending, and alternative financial
transactions involving thousands of investors.
Woodbridge Group of Companies and certain of its affiliates filed
Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case No.
17-12560) on Dec. 4, 2017. Woodbridge estimated assets and
liabilities at between $500 million and $1 billion. The Chapter 11
cases are being jointly administered.
Judge Kevin J. Carey presides over the case.
Samuel A. Newman, Esq., Oscar Garza, Esq., Daniel B. Denny, Esq.,
Jennifer L. Conn, Esq., Eric J. Wise, Esq., Matthew K. Kelsey,
Esq., and Matthew P. Porcelli, Esq., at Gibson, Dunn & Crutcher,
LLP, and Sean M. Beach, Esq., Edmon L. Morton, Esq., Ian J.
Bambrick, Esq., and Allison S. Mielke, Esq., at Young Conaway
Stargatt & Taylor, LLP, serve as the Debtors' bankruptcy counsel.
Homer Bonner Jacobs, PA, as special counsel, Province, Inc., as
expert consultant, Moelis & Company LLC, as investment banker.
The Debtors' financial advisors are Larry Perkins, John Farrace,
Robert Shenfeld, Reece Fulgham, Miles Staglik, and Lissa Weissman
at SierraConstellation Partners, LLC. Beilinson Advisory Group is
serving as independent management to the Debtors. Garden City
Group, LLC, is the Debtors' claims and noticing agent.
Pachulski Stang Ziehl & Jones is counsel to the Official Committee
of Unsecured Creditors; and FTI Consulting, Inc., serves as its
financial advisor.
An official committee of unsecured creditors was appointed in the
Chapter 11 cases on Dec. 14, 2017. On Jan. 23, 2018, the Court
approved a settlement providing for the formation of an ad hoc
noteholder group and an ad hoc unitholder group.
[*] 2018 DI Conference Discount Tickets Available for Early Birds
-----------------------------------------------------------------
Early registration discount tickets are currently available for
Beard Group's 2018 Distressed Investing (DI) Conference to be held
Monday, Nov. 26, 2018. The day-long program, marking the event's
25th year, will be held at The Harmonie Club, 4 East 60th Street,
New York, NY 10022. To register for the one-day conference visit:
https://www.distressedinvestingconference.com/
Conway MacKenzie, Foley & Lardner, Longford Capital and Development
Specialist Inc. (DSI) will again be partnering with Beard Group as
it marks the conference's Silver Anniversary. This milestone
denotes the event as the oldest, influential DI conference in the
U.S.
Debtwire will again be a media sponsor of the conference.
For a quarter of a century, the DI Conference's focus has been on
"Maximizing Profits in the Distressed Debt Market." The event also
serves as a forum for leaders in corporate restructuring, lending
and debt and equity investments to gather and discuss the latest
topics and trends in the distressed investing industry, as well as
exchange ideas about high-profile chapter 11 bankruptcy proceedings
and out-of-court restructurings. These are distinguished
professionals who place their resources and reputations at risk to
produce stellar results by preserving jobs, rebuilding broken
businesses, and efficiently redeploying underutilized assets in the
marketplace.
The conference will also feature the:
* Luncheon presentation of the Harvey K Miller Award to
Edward I. Altman, Professor of Finance, Emeritus, New York
University's Stern School of Business. (The award will be
presented by last year's winner billionaire Marc Lasry,
Altman's former student.)
* Evening awards dinner recognizing the 12 Outstanding
Restructuring Lawyers
To learn how you can be a sponsor and participate in shaping the
day-long program, contact:
Bernard Tolliver at bernard@beardgroup.com
or Tel: (240) 629-3300 x-149
To learn about media sponsorship opportunities to bring your outlet
into the view of leaders in corporate restructuring, lending and
debt and equity investments, and to expand your network of news
sources, contact:
Jeff Baxt at jeff@beardgroup.com
or (240) 629-3300, ext 150
[*] Fitch Group Completes Acquisition of Fulcrum Financial Data
---------------------------------------------------------------
Fitch Group, a unit of Hearst, on July 10. 2018, disclosed that it
has completed its acquisition of Fulcrum Financial Data, a leading
provider of leveraged finance and distressed debt analysis, news
and data. Fitch, in addition to having a strong presence in this
market through ratings and research, is now home to some of the
market's most influential news, data and analytic brands including
Covenant Review, LevFin Insights, CapitalStructure and
PacerMonitor.
Fitch announced its agreement to acquire Fulcrum from Leeds Equity
Partners on May 31, 2018.
Fulcrum CEO Steve Miller will continue to lead the business,
reporting to Dr. Ranjit Tinaikar, President, Fitch Solutions. Dr.
Tinaikar commented: "Fitch is committed to growing this business
and to supporting the editorial excellence that leveraged finance
and debt capital market participants have come to expect from these
great brands."
Mr. Miller commented: "As part of Fitch Solutions, our valuable
content and sought-after experts will help debt capital market
participants meet their news and information needs. We also look
forward to working alongside our colleagues in Fitch Ratings on
events and other opportunities to interact with investors, bankers
and issuers."
Brian Filanowski, Global Head of Product, Fitch Solutions,
commented: "Our goal is to deliver the best information platform
for leveraged finance professionals. We look forward to adding
news from sources like Covenant Review, CapitalStructure and LevFin
Insights to our Fitch Connect platform, where they will be offered
alongside ratings, research and analytics from Fitch Ratings."
About Fulcrum Financial Data
Fulcrum Financial Data offers unique insights, commentary, and data
that give subscribers an edge in playing the corporate bond,
leveraged loan and special situations markets. Fulcrum Financial
Data is led by a team of accomplished financial information
entrepreneurs, all of whom are recognized subject matter experts in
their respective areas. The portfolio includes:
-- Covenant Review is the trusted source for the interpretation
of corporate bond indentures and leveraged loan credit agreements.
-- LevFin Insights provides comprehensive real-time news,
commentary and data for leveraged loan and high-yield bond market
players.
-- CapitalStructure provides insightful first-to-market news and
analysis of the sub-investment grade universe, with a focus on
special situations.
-- PacerMonitor is a unified, modern and full-featured platform
for researching and tracking federal bankruptcy, district and
appellate court cases.
About Fitch Group
Fitch Group is a global leader in financial information, providing
critical insights that inform better decision-making in financial
markets. A unit of Hearst, Fitch Group is comprised of: Fitch
Ratings, a global leader in credit ratings and research; Fitch
Solutions, a leading provider of credit intelligence and the
primary distributor of Fitch Ratings content; and Fitch Learning, a
training and professional development firm specializing in
regulatory and certification exam training, professional skills
development, and blended e-learning solutions.
[*] K&L Gates Hires Hospitality, Restructuring and Insolvency Team
------------------------------------------------------------------
The Newark office of global law firm K&L Gates LLP has added a team
of lawyers to its resort, hospitality and leisure and restructuring
and insolvency practices. Partner Scott G. McLester joins K&L
Gates from Wyndham Worldwide Corporation, where he served as
executive vice president and general counsel, while partner Daniel
M. Eliades and of counsels David S. Catuogno and William L. Waldman
-- each with nearly three decades of experience -- arrive from
LeClairRyan.
In his capacity as general counsel, corporate secretary, and chief
compliance officer for Wyndham, Mr. McLester led a global team of
nearly 75 lawyers responsible for such areas as hotel, timeshare,
franchise, employment, intellectual property, and information
technology law, litigation, commercial transactions, corporate
governance, compliance and ethics, SEC and NYSE reporting, board of
director reporting and communications, and government relations.
He was appointed general counsel in 2006 after having previously
held multiple titles at Wyndham's predecessor company Cendant
Corporation.
Mr. Eliades represents franchisors in out-of-court workouts with
distressed franchisees, as well as collection and enforcement
litigation, and appears on behalf of franchisors in bankruptcy
cases throughout the United States. He advises timeshare
developers, resort owners, associations, and exchange companies in
a variety of debtor and creditor issues, and assists financial
institutions, finance entities, automobile lessors, real estate
holding companies, and other entities in loan restructurings,
compositions, commercial collection and foreclosure actions, lease
financing, and many phases of bankruptcy matters.
Mr. Catuogno advises creditors, particularly institutional lenders
and franchisors in the hospitality industry, in Chapter 7 and 11
proceedings, intellectual property protection, and in other
litigation and administrative matters. He also routinely
represents financial institutions and lenders in conjunction with
challenged loans in workouts and litigation matters involving
bankruptcy restructurings and liquidations.
Mr. Waldman also concentrates his practice on creditors' rights,
including representing financial institutions in workouts,
foreclosures, enforcement of security agreements, bankruptcy, real
estate transactions, and many aspects of commercial litigation,
such as pre-trial discovery, trials, and enforcement of federal and
state judgments, as well as foreclosures in the hospitality
industry. He also has significant experience negotiating and
drafting various types of agreements, contracts, and other
transactional matters.
"We are pleased and excited to have Scott, Dan, Bill, and Dave join
the K&L Gates global platform," said Anthony P. La Rocco, managing
partner of K&L Gates' Newark office. "Combining Scott's decades of
experience leading major hospitality, franchise, and other global
enterprises in and through various areas of law with the depth of
knowledge and decades of experience that Dan's team has serving
franchise and hospitality clients, we greatly enhance our ability
to service this industry segment and continue to grow the firm's
hospitality practice."
K&L Gates' resort, hospitality and leisure practice represents
clients including developers, investors, lenders, construction
companies, management companies and franchisors, and operators and
franchisees in complicated, large-scale, urban, and resort hotel
projects in areas across the firm's global platform.
With more than 65 bankruptcy lawyers, the restructuring and
insolvency practice has handled numerous mergers and acquisitions
of distressed resort and hotel properties and associated note
purchases and sales for lenders and investors, as well as loan
restructurings, asset-based lending, secured transactions,
intellectual property protection and overall financial
restructuring.
[^] BOOK REVIEW: Risk, Uncertainty and Profit
---------------------------------------------
Author: Frank H. Knight
Publisher: Beard Books
Softcover: 381 pages
List Price: $34.95
Review by Gail Owens Hoelscher
Order your personal copy today at
http://www.amazon.com/exec/obidos/ASIN/1587981262/internetbankrupt
The tenets Frank H. Knight sets out in this, his first book,
have become an integral part of modern economic theory. Still
readable today, it was included as a classic in the 1998 Forbes
reading list. The book grew out of Knight's 1917 Cornell
University doctoral thesis, which took second prize in an essay
contest that year sponsored by Hart, Schaffner and Marx. In it,
he examined the relationship between knowledge on the part of
entrepreneurs and changes in the economy. He, quite famously,
distinguished between two types of change, risk and uncertainty,
defining risk as randomness with knowable probabilities and
uncertainty as randomness with unknowable probabilities. Risk,
he said, arises from repeated changes for which probabilities
can be calculated and insured against, such as the risk of fire.
Uncertainty arises from unpredictable changes in an economy,
such as resources, preferences, and knowledge, changes that
cannot be insured against. Uncertainty, he said "is one of the
fundamental facts of life."
One of the larger issues of Knight's time was how the
entrepreneur, the central figure in a free enterprise system,
earns profits in the face of competition. It was thought that
competition would reduce profits to zero across a sector because
any profits would attract more entrepreneurs into the sector and
increase supply, which would drive prices down, resulting in
competitive equilibrium and zero profit.
Knight argued that uncertainty itself may allow some entrepreneurs
to earn profits despite this equilibrium. Entrepreneurs, he said,
are forced to guess at their expected total receipts. They cannot
foresee the number of products they will sell because of the
unpredictability of consumer preferences. Still, they must
purchase product inputs, so they base these purchases on the
number of products they guess they will sell. Finally, they have
to guess the price at which their products will sell. These
factors are all uncertain and impossible to know. Profits are
earned when uncertainty yields higher total receipts than
forecasted total receipts. Thus, Knight postulated, profits are
merely due to luck. Such entrepreneurs who "get lucky" will try to
reproduce their success, but will be unable to because their luck
will eventually turn.
At the time, some theorists were saying that when this luck runs
out, entrepreneurs will then rely on and substitute improved
decision making and management for their original
entrepreneurship, and the profits will return. Knight saw
entrepreneurs as poor managers, however, who will in time fail
against new and lucky entrepreneurs. He concluded that economic
change is a result of this constant interplay between new
entrepreneurial action and existing businesses hedging against
uncertainty by improving their internal organization.
Frank H. Knight has been called "among the most broad-ranging
and influential economists of the twentieth century" and "one of
the most eclectic economists and perhaps the deepest thinker and
scholar American economics has produced." He stands among the
giants of American economists that include Schumpeter and Viner.
His students included Nobel Laureates Milton Friedman, George
Stigler and James Buchanan, as well as Paul Samuelson. At the
University of Chicago, Knight specialized in the history of
economic thought. He revolutionized the economics department
there, becoming one the leaders of what has become known as the
Chicago School of Economics. Under his tutelage and guidance,
the University of Chicago became the bulwark against the more
interventionist and anti-market approaches followed elsewhere in
American economic thought. He died in 1972.
*********
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