/raid1/www/Hosts/bankrupt/TCR_Public/181221.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, December 21, 2018, Vol. 22, No. 354
Headlines
1989 3AVE: Case Summary & 2 Unsecured Creditors
A & K ENERGY: $2K Sale of Office Furniture to Collins Approved
A & K ENERGY: $46K Sale of Excess Inventory to Pasco Fleet Approved
ACEMLA DE PUERTO RICO: Taps Weinstein-Bacal as New Counsel
ADVANCED SPORTS: Gets Final Order for Store Closing Sales
AKRON INC: Moody's Lowers CFR to Caa1 & Alters Outlook to Neg.
AL THERAPY: Has Final Authorization to Use Cash Collateral
ALCOR ENERGY: Case Summary & 19 Unsecured Creditors
ALSTRAW ENTERPRISES: $400K Sale of Dulles Park Coin Laundry Okayed
ALSTRAW ENTERPRISES: $5K Sale of Herndon Coin Laundry Approved
AMERICAN TRUCK: Has Final Authority to Use Cash Collateral
AMISTAD READY MIX: Seeks to Hire Smeberg Law Firm as Legal Counsel
ANDERSON FARMS: Choice Livestock Buying Equipment for $46K
ANDREW YOUNG: Curtis Buying Surplus' Gary Property for $28K
ANDREW YOUNG: Gary II's $7.5K Private Sale of Gary Property Okayed
AVERY LAND: Jan. 30 Combined Plan, Disclosure Statement Hearing
CAFE HOLDINGS: Seeks to Hire Duff & Phelps as Investment Banker
CF INDUSTRIES: S&P Alters Outlook to Stable & Affirms 'BB+' ICR
CHAMPION BLDRS: Proposes Auction of Personal Property on Jan. 23
CHRISTIAN RADABAUGH, SR: Closing Cattle Sales
CIRCLE 9 CATTLE: Schuett Buying Whitehall Property for $5.1 Million
COLORADO WICH: Sondergaard Buying All Assets for $675K
CONTURA ENERGY: S&P Ups Issuer Credit Rating to B, Outlook Stable
COWLITZ TRIBAL: S&P Withdraws 'B+' Issuer Credit Rating
CVENT INC: S&P Alters Outlook to Stable and Affirms 'B-' ICR
DIAMONDBACK ENERGY: S&P Raises ICR to 'BB+' on Recent Acquisitions
DIVINE DINING: Trustee Selling All Assets to North Texas for $50K
ENERGEN CORP: S&P Raises ICR to 'BB+' Amid Diamond Energy Deal
FABRIC FANATICS: Third Interim Cash Collateral Use Okayed
FRANK THEATRES: Case Summary & 30 Largest Unsecured Creditors
GLANSAOL HOLDINGS: Case Summary & 30 Top Unsecured Creditors
GLANSAOL LLC: Files for Chapter 11 to Sell to AS Beauty
GOODYEAR TIRE: Fitch Afirms BB LT Issuer Default Rating
IMAGINE GROUP: S&P Cuts Issuer Credit Rating to B-, Outlook Stable
INDUSTRIAL FABRICATORS: Seeks Authority to Use Cash Collateral
INTEGRO GROUP: S&P Places 'B-' Long-Term ICR on Watch Positive
INTERNATIONAL BRIDGE: IBCM Buying Machine & Equipment for $52K
JAMES GARRISON: Douglases Buying Moaz Marital Home for $179K
JEANETTE CALICCHIA: Gurkas Buying Mahopac Property for $600K
JEP REALTY: $88K Sale of Lexington Property to The Reisig Approved
JOHN COBLE: $35K Sale of 13 Non-Tillable Acres in Delphi Approved
JONES LEASE PROPERTIES: Seeks Authority to Use Cash Collateral
LEGAL COVERAGE: Trustee Selling Business Assets to Legal for $20K
MAMMOET-STARNETH LLC: Jan. 16 Auction of All Assets Set
MANSFIELD BOAT: Seeks to Hire Lusky & Associates as Counsel
METROPISTAS: Moody's Hikes Rating on $435MM Notes to Ba3
MORRIS AND HADLEY: May Use Cash Collateral on Final Basis
NASHVILLE PHARMACY: Seeks to Hire Bass Berry as Legal Counsel
NASHVILLE PHARMACY: Seeks to Hire Tortola as Restructuring Advisor
ORBCOMM INC: S&P Affirms B Issuer Credit Rating, Outlook Positive
OSG BULK: S&P Assigns B+ Rating on New $325MM Sr. Sec. Term Loan
PETER JENSEN: BYK LLC Buying Standish Property for $106K
PETROQUEST ENERGY: Committee Hires Heller Draper as Counsel
PETROQUEST ENERGY: Hires FTI Consulting as Financial Advisor
PETROQUEST ENERGY: Hires Seaport Global as Investment Banker
PROMISE HEALTHCARE: Selling Equity Interests in Success for $10M
REEL AMUSEMENTS: Has Final Authorization to Use Cash Collateral
REPUBLIC METALS: Supplements Proposed Prepaid Products Sale
RESIDENTIAL RESOURCES: Fitch Rates $17.2MM 2018 Bonds 'BB+'
SALLE FAMILY: Has Authorization to Use BHML Cash Collateral
SEASONS CORPORATE: $10.25M Sale of All Assets to SSNS Approved
SENIOR CARE: Seeks to Hire Polsinelli PC as Counsel
SOAPTREE HOLDINGS: Seeks to Hire RPD Analytics as Appraiser
SOUTHCROSS ENERGY: S&P Lowers ICR to 'CCC-', Outlook Negative
ST. JUDE NURSING: PCO Files 2nd Report
STARION ENERGY: Seeks to Hire Ordinary Course Professionals
STRATOS ENTERPRISES: Selling West Monroe Property for $450K
SUPERIOR HOME: PCO Files 3rd Report
SYNERGY PHARMACEUTICALS: BH Buying Assets for $185 Million
T BAR W PROPERTIES: Hires Michael E. Gazette as Attorney
TECHNOLOGY SOLUTIONS: Seeks to Hire Stern Kory as Accountant
THAKORJI INC: Seeks to Hire Marcus & Millichap as Broker
THOMAS O. EIFLER: Successors Buying Book of Business for $1M
TINA JONES: TennMO Buying Rutherford Property for $1.2 Million
UNLOCKD MEDIA: Seeks to Hire Mayerson and Hartheimer as Counsel
UNLOCKD MEDIA: Seeks to Hire Vernon as Financial Advisor
USA GYMNASTICS: Hires Omni as Claims and Noticing Agent
VIKEN MANJIKIAN: $325K Sale of Highway 371 Properties Approved
W RESOURCES: Creditors Buying Warren Peak Ranch Property
[*] BOOK REVIEW: Macy's for Sale
*********
1989 3AVE: Case Summary & 2 Unsecured Creditors
-----------------------------------------------
Debtor: 1989 3Ave LLC
87-10 Queens Blvd., 1st Floor
Elmhurst, NY 11373
Business Description: 1989 3Ave LLC is a privately held company
engaged in activities related to real
estate.
Chapter 11 Petition Date: December 19, 2018
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Case No.: 18-47234
Judge: Hon. Nancy Hershey Lord
Debtor's Counsel: William X. Zou, Esq.
LAW OFFICES OF XIAN FENG ZOU
136-20 38 Avenue, Ste 10D
Flushing, NY 11354
Tel: (718) 661-9562
Fax: (718) 661-2211
Email: xfzou@aol.com
Total Assets: $23,000,106
Total Liabilities: $24,761,785
The petition was signed by Bo Jin Zhu, manager.
A full-text copy of the petition is available at no charge at:
http://bankrupt.com/misc/nyeb18-47234.pdf
List of Debtor's Two Unsecured Creditors:
Entity Nature of Claim Claim
Amount
------ ---------------
------------
1989 Investment LLC
$3,500,000
c/o 87-10 Queens Blvd., 1st Floor
Elmhurst, NY, 11373
ZLZ 33 Inc. and Chum Sum Cheng and Ji
$3,000,000
Juan Lin
c/o Law Office of Victor Tsai
562 Coney Island Avenue Storefront
Brooklyn, NY, 11218
A & K ENERGY: $2K Sale of Office Furniture to Collins Approved
--------------------------------------------------------------
Judge Catherine Peek McEwen of the U.S. Bankruptcy Court for the
Middle District of Florida authorized A & K Energy Conservation,
Inc.'s sale of office furniture located at 1615 Lakes Parkway,
Suite E, Lawrenceville, Georgia to Mike Collins for $2,000.
A hearing on the Motion was held on Dec. 4, 2018 at 2:15 p.m.
The sale is free and clear of all liens, claims, and encumbrances.
Within 15 days of the entry of the Order, the Buyer will deliver
the Purchase Price in good funds to the counsel of the Debtor in
accordance with the terms of the Motion and the Order.
Within 15 days of receipt from the Buyer, the proceeds from the
payment of the Purchase Price will be disbursed, after payment of
ordinary, reasonable, and necessary closing costs and other
expenses directly attributable to the sale, to PNC Bank, N.A.
The 14-day stay set forth in Bankruptcy Rule 6004(h) is waived, for
good cause shown, and the Order will be immediately enforceable and
the closing may occur immediately following the entry of the
Order.
About A & K Energy Conservation
A&K Energy Conservation, Inc. -- http://www.akenergy.com/-- offers
customized lighting solutions and energy management services,
including energy audits, lighting retrofits, rebate processing, and
more.
A & K Energy Conservation filed a Chapter 11 petition (Bankr. M.D.
Fla. Case No. 17-03318) on April 19, 2017. In the petition signed
by CRO William Maloney, the Debtor estimated assets and liabilities
between $1 million and $10 million.
Judge Catherine Peek McEwen oversees the case.
Amy Denton Harris, Esq., and Mark F Robens, Esq., at Stichter,
Riedel, Blain & Postler, P.A., serve as the Debtor's counsel. The
Debtor hired Bill Maloney of Bill Maloney Consulting, as CRO; and
Wells Houser & Schatzel, P.A., as certified public accountant.
A & K ENERGY: $46K Sale of Excess Inventory to Pasco Fleet Approved
-------------------------------------------------------------------
Judge Catherine Peek McEwen of the U.S. Bankruptcy Court for the
Middle District of Florida authorized A & K Energy Conservation,
Inc.'s sale of 15 vehicles and eight trailers to Pasco Fleet
Service, LLC for the aggregate purchase price of $45,900.
The Vehicles are:
a. 2006 Ford E350 Cargo, VIN 1FDSE35L26DB2511: $3000
b. 2008 Ford E350 Bucket, VIN 1FDWF36528EA53015: $4,500
c. 2006 Ford E350 Crew, VIN 1FBSS31L46HA30677: $1,500
d. 1999 Chevy C6500 Bucket, VIN 1GBK7H1C2XJ105532: $6,500
e. 2005 Ford E250 Cargo, VIN 1FTNS24W05HA11177: $1,800
f. 2006 Ford E350 Crew, VIN 1FBNE31L86HA71916: $1,500
g. 2004 Ford E350 Cutaway, VIN 1FDSE35L84HB27175: $3,500
h. 2004 Ford E350 Cutaway, VIN 1FDSE35L44HB24080: $2,500
i. 2000 Chevy G3500 Bucket, VIN 1GCHG35R4Y1255246: $1,500
j. 2007 Chevy Express 2500, VIN 1GCGG29V671106896: $4,800
k. 2007 Chevy Express 2500, VIN 1GCGG29V171132631: $2,000
l. 2007 Chevy Express 2500, VIN 1GBHG31V971211944: $2,000
m. 2007 Ford E250 Cargo, VIN 1FTNS24W97DB37225: $2,800
n. 2007 Ford E250 Cargo, VIN 1FTNS24L77DA38456: $2,500
o. 2009 Champion Utility Trailer, VIN GT22423: $2,300
p. 2009 Champion Utility Traile, VINr GT22422: $400
q. 2007 Loudo Utility Trailer, VIN 1L9BU10157N383727: $400
r. 2008 Homemade Utility Trailer, VIN NOVIN0200928369: $400
s. 2008 Loudo Utility Trailer, VIN 1L9BU08128N383474: $400
t. 2008 Loudo Utility Trailer, VIN 1L9BU08108N383473: $400
u. 2011 Crown Utility Trailer, VIN TC102010501: $400
v. 2008 Loudo Utility Trailer, VIN 1L9BU08148N383069: $400
Within 15 days of receipt from the Buyer, the proceeds from the
payment of the Purchase Price will be disbursed, after payment of
ordinary, reasonable, and necessary closing costs and other
expenses directly attributable to the sale, to PNC Bank, N.A.
The 14-day stay set forth in Bankruptcy Rule 6004(h) is waived, for
good cause shown, and the Order will be immediately enforceable and
the closing may occur immediately following the entry of the
Order.
About A & K Energy
A&K Energy Conservation, Inc. -- http://www.akenergy.com/-- offers
customized lighting solutions and energy management services,
including energy audits, lighting retrofits, rebate processing, and
more.
A & K Energy Conservation filed a Chapter 11 petition (Bankr. M.D.
Fla. Case No. 17-03318) on April 19, 2017. In the petition signed
by CRO William Maloney, the Debtor estimated assets and liabilities
between $1 million and $10 million.
The Hon. Catherine Peek McEwen oversees the case.
Amy Denton Harris, Esq., and Mark F. Robens, Esq., at Stichter,
Riedel, Blain & Postler, P.A., serve as the Debtors counsel. The
Debtor also hired Bill Maloney of Bill Maloney Consulting, as chief
restructuring officer; and Wells Houser & Schatzel, P.A., as
certified public accountant.
ACEMLA DE PUERTO RICO: Taps Weinstein-Bacal as New Counsel
----------------------------------------------------------
ACEMLA De Puerto Rico Inc. and Latin American Music Co., Inc., seek
approval from the U.S. Bankruptcy Court for the District of Puerto
Rico to hire Weinstein-Bacal, Miller & Vega, P.S.C. as their new
legal counsel.
Weinstein-Bacal will substitute for Gratacos Law Firm, P.S.C., the
firm initially hired by the Debtors to represent them in their
Chapter 11 cases.
The firm will charge these hourly fees:
Stuart Weinstein-Bacal $450
Peter Miller $200
Javier Vega-Villalba $200
Myriam Ocasio Arana $175
Associate Attorneys $175
Paralagels/Law Clerks $50 - $100
The firm's attorneys and employees are "disinterested" as defined
in section 101(14) of the Bankruptcy Code, according to court
filings.
Weinstein-Bacal can be reached through:
Stuart A. Weinstein-Bacal, Esq.
Peter W. Miller, Esq.
Javier A. Vega-Villalba, Esq.
Myriam Ocasio Arana, Esq.
Weinstein-Bacal, Miller & Vega, P.S.C.
Gonzalez-Padin Building - Penthouse
154 Rafael Cordero Street, Plaza de Armas
Old San Juan, PR 00901
Telephone: (787) 977-2550
Telecopier: (787) 977-2559
Email: swb@wbmvlaw.com
Email: sawbacal@aol.com
Email: pwm@wbmvlaw.com
Email: jvv@wbmvlaw.com
Email: moa@wbmvlaw.com
About ACEMLA de Puerto Rico Inc.
ACEMLA de Puerto Rico Inc. is one of the four "Performance Rights
Organization" (PRO), in the United States and No. 76 in the CISAC
world roster. It controls and licenses LAMCO's non-exclusive
performance rights and those of its affiliate music publisher's
editors and composers. This institution was created to defend the
Latin composer's rights in the United States and the world, and it
is as such that in 1985, by an appeal presented before the highest
federal court in this country, against a decision of the Copyright
Royalty Tribunal against ASCAP, BMI and SESAC, is successful, and
since then ACEMLA operates as the fourth society, or a performance
Rights Society (PRO), in the United States.
ACEMLA de Puerto Rico Inc. and Latin American Music Co Inc. filed
Chapter 11 petitions (Bankr. D.P.R. Case Nos. 17-02021 and
17-02023) on March 24, 2017. In its petition, ACEMLA estimated
assets of less than $500,000 and liabilities of $1 million to $10
million. LAMCO estimated assets and liabilities of less than $1
million.
The Hon. Enrique S. Lamoutte Inclan presides over the cases.
Gratacos Law Firm, PSC, serves as bankruptcy counsel.
ADVANCED SPORTS: Gets Final Order for Store Closing Sales
---------------------------------------------------------
Judge Benjamin A. Kahn of the U.S. Bankruptcy Court for the Middle
District of North Carolina ratified and confirmed on a final basis
the third interim order authorizing Advanced Sports Enterprises,
Inc. and its debtor-affiliates, on an interim basis, to (i) operate
under their Store Closing Program -- Consulting Agreement dated
Oct. 31, 2018, as amended and restated pursuant to the Store
Closing Program as Amended and Restated Consulting Agreement dated
as of Nov. 29, 2018, with Gordon Brothers Retail Partners, LLC;
(ii) continue to operate "store closing" and other mutually agreed
upon themed sales at the Debtors' 40 retail stores identified in
the Amended Agreement; and (iii) operate "store closing" and other
mutually agreed upon themed sales at the Debtors' 62 retail stores
identified in the Amended Agreement in accordance with the terms of
the Amended Agreement and store closing sale guidelines.
The Final Hearing on the Motion was held on Dec. 14, 2018.
Within three business days of entry of this Third Interim Order,
the Debtors will serve copies of the Order on: (a) the Attorney
General's office for each state where the Sales are being held, (b)
the county consumer protection agency or similar agency for each
county where the Sales are being held, (c) the division of consumer
protection for each state where the Sales are being held; (d) the
chief legal counsel for the local jurisdiction; (e) the Debtors’
landlords of the Stores; and (f) the Master Service List (as set
forth in the Order Establishing Notice and Administrative
Procedures) and file a certificate of service with the Court.
About Advanced Sports Enterprises
Advanced Sports Enterprises, Inc. designs, manufactures and sells
bicycles and related goods and accessories.
Advanced Sports, Inc. is a wholesale seller of bicycles and
accessories. ASI owns the following bicycle brands and is
responsible for their design manufacture and worldwide
distributions: Fuji, Kestrel, SE Bikes, Breezer, and Tuesday.
Performance Direct, Inc., designs, manufactures and sells bicycles
and related goods and accessories and operates a national
distribution of these goods under the Performance Bicycle brand
through an internet website business via the URL
http://www.performancebike.com/
Bitech, Inc. operates 104 retail stores across 20 states under the
Performance Bicycle brand related to the sale of bicycles and
related good and accessories. The businesses of Performance and
Bitech operate in conjunction with each other and they share a
number of services and a distribution warehouse.
Nashbar Direct, Inc. designs, manufactures and sells bicycles and
related goods and accessories under the Bike Nashbar brand through
an internet website business via the URL
http://www.bikenashbar.com/ The businesses of Nashbar also operate
in conjunction with Performance and share services and a
distribution warehouse.
Advanced Sports Enterprises and its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. M.D.N.C. Lead Case
No. 18-80856) on Nov. 16, 2018.
Advanced Sports Enterprises estimated assets of $1 million to $10
million and liabilities of $10 million to $50 million while
Advanced Sports, Inc., estimated assets of $100 million to $500
million and liabilities of $50 million to $100 million.
The cases have been assigned to Judge Benjamin A. Kahn.
The Debtors tapped Northen Blue, LLP and Flaster/Greenberg P.C. as
their bankruptcy counsel; D.A. Davison & Co. as investment banker;
Clear Thinking Group LLC as financial advisor; and Kurtzman Carson
Consultants LLC as claims, noticing and balloting agent.
AKRON INC: Moody's Lowers CFR to Caa1 & Alters Outlook to Neg.
--------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Akorn, Inc.
including the Corporate Family Rating to Caa1 from B3, the
Probability of Default Rating to Caa1-PD from B3-PD and the senior
secured term loan rating to Caa1 from B3. Moody's also downgraded
the Speculative Grade Liquidity Rating to SGL-3 from SGL-2. Akorn's
rating outlook was revised to negative from developing.
On December 7, 2018, Delaware's Supreme Court ruled to uphold the
lower court's decision to allow Fresenius SE & Co. KGaA
("Fresenius", Baa3 stable) to terminate its April 2017 merger
agreement with Akorn. The ruling was on the grounds that a Material
Adverse Effect had taken place.
"The downgrade reflects Akorn's deteriorating stand-alone credit
profile and uncertainty around its ability to reverse steep revenue
and earnings declines," said Moody's Vice President Morris
Borenstein. "With near breakeven EBITDA in the third quarter 2018,
Akorn's financial leverage is over 10 times gross debt/EBITDA and
brings into question the sustainability of its capital structure if
the company is not able to improve profitability." Borenstein
continued "Akorn will have weak cash flow over the next 12-18
months as the company's product pipeline has not been able to
offset declines in the existing portfolio." That said, Moody's
believes there are material costs that could be taken out of the
business in order to improve profitability. However, without a
permanent CEO the company has yet to articulate a strategy around
restructuring or cost cutting efforts.
The rating outlook is negative reflecting the high degree of
uncertainty around Akorn's ability to reverse revenue and earnings
declines while managing through the risks associated with
outstanding manufacturing and compliance issues. These and other
remediation actions may be costly and result in business
disruptions that could further weaken Akorn's credit profile.
Ratings downgraded:
Akorn, Inc.
Corporate Family Rating to Caa1 from B3
Probability of Default Rating to Caa1-PD from B3-PD
Senior secured term loan to Caa1 (LGD4) from B3 (LGD3)
Speculative Grade Liquidity Rating to SGL-3 from SGL-2
The outlook was revised to negative from developing.
RATINGS RATIONALE
Akorn's Caa1 Corporate Family Rating is constrained by its high
financial leverage, weak free cash flow, and mainly declining
portfolio of products. It is also constrained by its moderate size
in the highly competitive generic drug industry where Akorn
competes against significantly larger companies. Moody's believes
Akorn's debt/EBITDA will increase in 2019 unless the company repays
debt voluntarily or significantly reduces its cost base.
Debt/EBITDA was high at above 10 times for the twelve months ended
September 30, 2018. Moody's believes earnings will further erode in
2019 driven by volume and price erosion on existing products which
will be only partially offset by modest contributions from new
product launches. In addition, failure to resolve observations made
by the FDA at its Decatur, Illinois plant in May 2018 could disrupt
its ability to receive FDA approvals of new products. The rating is
supported by Akorn's meaningful cash balance and specialization in
more complex formulations, including injectables, ophthalmics and
topicals.
The SGL-3 Speculative Grade Liquidity Rating reflects Moody's
expectation for adequate liquidity over the next 12-15 months. The
company had $275 million of cash at September 30, 2018. Debt
amortization is modest at about $5 million annually. Absent
meaningful cost base reductions, Moody's believes free cash flow
will be negative in 2019. Akorn has $135 million of availability
under its $150 million asset-based lending (ABL) facility that is
not likely to be utilized, however the facility expires in April
2019. The ABL has a 1 times minimum fixed charge coverage covenant
that is in effect when more than 90% of the facility is drawn. The
term loan does not have any maintenance covenants and matures in
April 2021.
Akorn's ratings could be downgraded if Akorn is unable to reverse
steep revenue declines or effectively reduce its cost structure,
such that the company cannot sustainably generate free cash flow.
Deterioration in liquidity, rising refinancing risk or weakened
recovery prospects for lenders could also lead to a downgrade.
Escalation of manufacturing and regulatory compliance issues at the
FDA that result in business disruptions could also warrant a
downgrade.
Akorn would need to rectify its manufacturing and compliance issues
before Moody's would consider an upgrade. In addition, sustainably
positive free cash and debt/EBITDA below 7 times would be needed to
consider an upgrade.
Akorn, Inc., headquartered in Lake Forest, IL, is a specialty
generic pharmaceutical manufacturer. The company focuses on generic
drugs in alternate dosage forms such as ophthalmic drugs,
injectable drugs and others in liquid, semi-solid, topical and
nasal spray dosage forms. The company reported revenue of $727
million for the twelve months ended September 30, 2018.
The principal methodology used in these ratings was Pharmaceutical
Industry published in June 2017.
AL THERAPY: Has Final Authorization to Use Cash Collateral
----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas has
entered a final order authorizing AL Therapy LLC's use of cash
collateral as set forth in the budget.
The Debtor stipulates that as of the Petition Date, (a) it was
indebted to Wells Fargo Bank, N.A., under a Prepetition Credit
Facility, (b) the Prepetition Facility Obligations are legal,
valid, binding, fully perfected, and non-avoidable obligations in
the estimated aggregate liquidated amount of not less than
$655,739; and (c) the Prepetition Facility Obligations and the
Prepetition Facility Liens constitute legal, valid, binding, fully
perfected, and non-avoidable senior first-priority obligations of
the Debtor, enforceable in accordance with the terms and conditions
of the Prepetition Facility Documents.
Wells Fargo Bank is granted (a) automatic perfected replacement
liens on all property now owned or hereafter acquired by the
Debtor; and (b) superpriority administrative claims pursuant to
sections 361(2), 363(c)(2), 503(b)(1), 507(a)(2), and 507(b) of the
Bankruptcy Code. The Replacement Liens will not attach to any
Chapter 5 causes of action under the Bankruptcy Code.
The Replacement Liens and the Superpriority Claims are granted
solely to the extent that the Debtor’s use of Cash Collateral
results in a diminution in value of the Prepetition Facility
Collateral securing the Prepetition Facility Obligations and will
constitute legal, valid, binding, fully perfected, and
non-avoidable obligations of the Debtor, enforceable against the
Debtor's estate and its respective successors and assigns,
including, without limitation, any successor trustee or other
estate representative in the Bankruptcy Case or any subsequent or
superseding proceedings under chapter 7 or chapter 11 of the
Bankruptcy Code, in accordance with the terms of the Final Order.
In addition, the Debtor will:
(a) make monthly payments of $2,000 to Wells Fargo Bank on
the 15th day of every month;
(b) allow Wells Fargo Bank, its agent or any party authorized
under the Prepetition Facility Documents to conduct and finalize an
audit of the Prepetition Facility Collateral and Collateral and to
conduct a physical inspection of each of the Debtor's facilities,
and will reasonable cooperate with such audit and inspections;
(c) maintain adequate insurance coverage on the Prepetition
Facility Collateral and the Collateral, as may be required under
the Prepetition Facility Documents, and maintain or name Wells
Fargo Bank as mortgagee, lender loss payee and/or additional
insured under the insurance policies; and
(d) remain current in all post-petition tax payment and
reporting obligations.
The Debtor will immediately cease using the cash collateral after
the Cure Period upon the occurrence of any of these events: (a)
there is an Event of Default under the Prepetition Facility
Documents; (b) the Debtor violates any term of the Final Order; or
(c) entry of an order:
(i) converting the Debtor's Bankruptcy Case to a case under
Chapter 7 of the Bankruptcy Code;
(ii) dismissing the Debtor's Bankruptcy Case;
(iii) reversing, vacating, or otherwise amending,
supplementing, or modifying the Final Order;
(iv) terminating or modifying the automatic stay for any
creditor asserting a lien on the collateral other than Wells Fargo;
or
(v) invalidating, subordinating, or otherwise sustaining any
challenge to the Prepetition Facility Liens, the Replacement Lines,
or the Superpriority Claims granted to Wells Fargo under the Final
Order.
A full-text copy of the Final Order is available at
http://bankrupt.com/misc/txnb18-32694-49.pdf
About AL Therapy LLC
AL Therapy LLC filed a Chapter 11 petition (Bankr. N.D. Tex. Case
No. 18-32694) on Aug. 10, 2018. In the petition signed by its
managing member, Lyle Matthis, the Debtor estimated $100,001 to
$500,000 in assets and $500,001 to $1 million in liabilities. Eric
A. Liepins, P.C., led by principal Eric A. Liepins, is the Debtor's
counsel.
ALCOR ENERGY: Case Summary & 19 Unsecured Creditors
---------------------------------------------------
Debtor: Alcor Energy, LLC
7754 East Velocity Way
Mesa, AZ 85212
Business Description: Alcor Energy, LLC is in the turbines and
turbine generator business. Alcor Energy
sought to build a clean burning way of
power generation that was powerful enough
for large projects, reliable, and safe for
the atmosphere. The Company's turbines use
100% natural gas, which is the cleanest
possible fossil fuel to burn. The Company
handles every details related to its turbine
generators, from the smallest of
remanufacturing to highly trained field
support personnel. Its remanufactured
turbine
generators are self-contained, sound-
attenuated mobile units. To learn more,
visit
https://www.alcor.energy
Chapter 11 Petition Date: December 19, 2018
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Case Number: 18-12839
Debtor's
General
Bankruptcy
Counsel: Ian J. Bambrick, Esq.
YOUNG, CONAWAY, STARGATT & TAYLOR, LLP
1000 North King Street
Wilmington, DE 19801
Tel: 302-571-6600
E-mail: ibambrick@ycst.com
- and -
M. Blake Cleary, Esq.
YOUNG, CONAWAY, STARGATT & TAYLOR, LLP
1000 North King Street
Wilmington, DE 19801
Tel: 302-571-6600
Fax: 302-571-1253
E-mail: mbcleary@ycst.com
- and -
Elizabeth Soper Justison, Esq.
YOUNG, CONAWAY, STARGATT & TAYLOR, LLP
Rodney Square
1000 N. King Street
Wilmington, DE 19801
Tel: 302-571-6703
E-mail: ejustison@ycst.com
Debtors'
Restructuring
Financial
Advisor: D.R. PAYNE AND ASSOCIATES
Total Assets as of Nov. 30, 2018: $10,215,664
Total Liabilities as of Nov. 30, 2018: $5,002,071
The petition was signed by Wiley Zimmerman, chief executive
officer.
A full-text copy of the petition is available at no charge at:
http://bankrupt.com/misc/deb18-12839.pdf
List of Debtor's 19 Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Mesa Green Electric Litigation $600,000
Power Phase I, LLC plus interest
David T. Bonfiglio and fees
4356 N Civic Center Plaza
Scottsdale, AZ 85251
Tel: 480-970-0974
Email: david@bonfiglio-law.com
Fort Berthold Penalty $402,602
Reservation TERO
Reed Soderstrom
Pringle & Herigstad P.C.
2525 Elk Drive
Minot, ND 58701
Tel: 701-833-6910
Email: rsoderstrom@pringlend.com
Trustland Oilfield Litigation $165,462
Services, LLC
Steve Kelly
720 Western Ave. Ste 204
Minot, ND 58701
Tel: 701-421-7930
Email: steve.kelley@trustlandllc.com
Sunbelt Transformer Inc. $73,338
Karina Santos
1922 S. MLK Jr. Dr.
Temple, TX 76504
Tel: 254-742-7907
Email: ksantos@sunbeltusa.com
Sunmore LLC Rent $40,000
Thomas Johnston Broker
619 W Texas Ste. 111
Midland, TX 79701
Tel: 432-688-8201
Fax: 432-934-3333
Email: realestateranch@aol.com
46 LLC Trade Debt $37,006
Jeff McCall
4307 N. Civic Center Plaza
Tel: 480-946-0066
Email: mail@mcaarch.com
Lewis Roca Rothgerber Legal Fees $19,220
Christie LLP
Centralized Accounting Dept.
201 East Washington St.
Suite 1200
Phoenix, AZ 85004-2595
Tel: 602-239-7486
Email: ar@lrrc.com
OTC Trucking & Logistics Trucking $12,821
Tammy Keber
5501 Sherwood Dr. Apt J103
Midland, TX 79707
Tel:417-322-4916
Email: otc.trucking.llc@gmail.com
First Insurance Funding Insurance $9,769
Accounts Payable
450 Skokie Blvd, Ste 1000
Northbrook, IL 60062-7917
Tel: 800-837-2511
Email: csr@firstinsurancefunding.com
The Hartford Insurance $8,881
Accounts Payable
PO Box 660916
Dallas, TX 75266
Tel: 866-467-8730
Midwest Compressor Trade Debt $7,500
Systems, LLC dba LRS
Kenny Gerber
P.O. Box 1381
Pampa, TX 79066
Tel: 806-669-3427
Email: kgerber@lrssys.com
Sunwest, Inc. Trade Debt $4,150
Tom Sunderland
34th Avenue S #1233
Fargo, ND 58104
Tel: 701-205-6804
Email: tsun@live.com
Industrial Commission of Arizona Fine $1,875
Division of Occupational
Safety & Health
800 W. Washington
Phoenix, Arizona 85007
Tel: 602-542-4411
Email: comments@azdosh.gov
Trinity Consultants Emission $1,093
Michael Meister Consulting
12700 Park Central Dr.
Suite 2100
Dallas, TX 75251
Tel: 972-661-8100
Email: nmeister@trinityconsultants.com
Ameripride Services, Inc. Trade Debt $1,082
Accounts Payable
6025 W. Van Buren
Phoenix, AZ 85043-3509
Tel: 800-675-6362
Email: acctree17@ameripride.com
Chubb Insurance $1,032
Accounts Payable
P.O. Box 382001
Pittsburgh, PA 15250-8001
Tel: 800-372-4822
Email: customercare@chubb.com
Arguindegui Oil Company Trade Debt $494
Accounts Payable
PO Box 1369 4506 Highway 359
Laredo, TX 78042
Tel: 956-744-6130
Email: carlos.perez@argpetro.com
Zachary Hart Uncleared $16
3335 Prairie Commons Street Check
Williston, ND 58801
Tel: 701-651-6931
Bruin E&P Operating, LLC Litigation Unknown
Crowley Fleck PLLP
500 Transwestern Plaza II
490 N 31st St. 500
Billings, MT 59101
Tel: 701-224-7546
ALSTRAW ENTERPRISES: $400K Sale of Dulles Park Coin Laundry Okayed
------------------------------------------------------------------
Judge Brian F. Kenney of the U.S. Bankruptcy Court for the Eastern
District of Virginia authorized Alstraw Enterprises, Inc.'s sale of
the leasehold improvements, the real estate leases and all of the
personal property assets in coin-operated laundry location in
Dulles, Virginia, also known as the Dulles Park Coin Laundry, to
Sung Pyo Hung for $400,000.
The Buyer will have 14 calendar days after the entry of the Order
to enter into a lease agreement with the landlord, and that the
closing will occur seven calendar days after a lease agreement is
signed.
Should the closing not take place within the time limits specified,
then at the election of the Debtor, the sale property is authorized
to be sold to Robert Schwartz and/or SuperSuds Management, LLC for
$395,000, with the Buyer being given 14 days calendar days to enter
into a lease agreement with the landlord, and that the closing will
occur seven calendar days after a lease agreement is signed.
The stay pursuant to Rule 6004(h) of the Federal Rules of
Bankruptcy Procedures is waived.
All costs of sale and settlement and a broker's fee of 10%, and the
broker's expenses, not to exceed $2,000, will be paid from the net
proceeds of sale and disbursed at the Closing.
A $10,000 break-up fee will be paid to Robert Schwartz at
settlement if Sung Pyu Hong closes in the sale.
The prepetition rent arrearage due Dulles Park Shopping Center,
L.L.C. in the amount of $196,601, in addition to the attorneys'
fees incurred by Dulles Park Shopping Center between November 2017
and the date of the Closing, provided that such fees do not exceed
$31,200, plus Court costs of $88 incurred by Dulles Park Shopping
Center in the state court proceeding, such sums totaling $$227,889,
together with the share of rent due for December 2018 pro-rated to
the date of Closing, unless such rent will have already been paid
by the Debtor, will be paid directly to the landlord, Dulles Park
Shopping Center from the net proceeds of sale at closing.
The net sales proceeds which remain after payment of the sums
required will be placed in the DIP Account to be preserved until
further order of the Court.
The security deposit of the Debtor in the amount of $18,057 held by
the landlord will be a credit against the prepetition rent
arrearage due to Dulles Park Center, L.L.C., and Dulles Park
Shopping Center may retain and appropriate such security deposit as
its own property free from any claims.
The rent due for December 2018 in the sum of $23,685 if not paid by
the Debtor prior to the Closing, will be pro-rated to the date of
closing and allocated between Dulles Park Shopping Center and the
Buyer.
All the utility bills and invoices due and payable with respect to
the premises will be pro-rated to the date of the Closing and the
Debtor's share paid from the net proceeds of the sale, and any
known utility bills and invoices, whether now existing or received,
and which pertain to charges for utility service to the premises
for any period prior to the date of Closing will be a claim against
the estate of the Debtor.
In the event the Closing does not occur by Jan. 21, 2019, then the
automatic stay as to any action of the landlord to exercise its
applicable nonbankruptcy remedies to regain possession of the
premises from the Debtor will terminate as of 11:59 p.m. on Jan.
21, 2019.
About Alstraw Enterprises
Alstraw Enterprises, Inc., operates four coin laundries at separate
locations, including Dulles Park, Herndon, Dumfries and Manassas.
Each of these businesses occupy leased space and some have
different names under which they do business, the Dumfries location
being known as "Plaza Coin Laundry" and Herndon being known as the
"The Herndon Coin Laundry."
Alstraw Enterprises, Inc., filed a Chapter 11 bankruptcy petition
(Bankr. E.D. Va. Case No. 18-11430) on April 23, 2018.
The Debtor hired Richard G. Hall, as counsel. Stephen Karbelk of
Auction Markets, LLC was appointed as the sales agent for the
Debtor on July 12, 2018. Scott W. Miller of Analytic Financial
Group, LLC was appointed as a financial advisor for the Debtor
retroactively to June 15, 2018, on July 17, 2018.
ALSTRAW ENTERPRISES: $5K Sale of Herndon Coin Laundry Approved
--------------------------------------------------------------
Judge Brian F. Kenney of the U.S. Bankruptcy Court for the Eastern
District of Virginia authorized Alstraw Enterprises, Inc.'s sale of
the leasehold improvements, the real estate leases and all of the
personal property assets in coin operated laundry location 692
Elden Street, Herndon, Virginia, also known as The Herndon Coin
Laundry, to The Laundry Owners Warehouse for $5,000.
The 10% commission of the estate's sale agent, Stephen Karlbeck of
Auction Markets, in the amount of $500, and his expenses of $445,
and the costs of settlement will be paid at settlement, and that
thereafter, the balance will be paid into the Debtor's DIP
Account.
About Alstraw Enterprises
Alstraw Enterprises, Inc., operates four coin laundries at separate
locations, including Dulles Park, Herndon, Dumfries and Manassas.
Each of these businesses occupy leased space and some have
different names under which they do business, the Dumfries location
being known as "Plaza Coin Laundry" and Herndon being known as the
"The Herndon Coin Laundry."
Alstraw Enterprises, Inc., filed a Chapter 11 bankruptcy petition
(Bankr. E.D. Va. Case No. 18-11430) on April 23, 2018.
The Debtor hired Richard G. Hall, as counsel. Stephen Karbelk of
Auction Markets, LLC was appointed as the sales agent for the
Debtor on July 12, 2018. Scott W. Miller of Analytic Financial
Group, LLC, was appointed as a financial advisor for the Debtor
retroactively to June 15, 2018, on July 17, 2018.
AMERICAN TRUCK: Has Final Authority to Use Cash Collateral
----------------------------------------------------------
The Hon. Sarah A. Hall of the U.S. Bankruptcy Court for the Western
District of Oklahoma has entered a final order authorizing American
Truck Training, Inc.'s use of cash collateral.
According to the Final Order, the Debtor may use cash collateral
only to fund the itemized expenditures contained in the budget.
The Debtor is allowed to deviate the amount designated for a
particular line-item so long as the percentage of deviation of each
line item during any rolling 4-week period does not exceed 10% in
aggregate. Any unused portion of the Variance will carry over to
the following rolling 4-week period.
The Debtor will provide to Quail Creek Bank, N.A. and the IRS an
initial aging of all accounts receivable and accounts payable and a
list of all inventory, plus total current operating expenses and
total current collections. This report will be updated and provided
to the Secured Creditors by the 30th day of each month thereafter.
Internal Revenue Service and Quail Creek Bank, N.A. are entitled to
a validly perfected first priority lien on and security interests
in the Debtor's post-petition collateral subject to existing valid,
perfected and superior liens in the collateral held by other
creditors, if any, and the Carve-Out. Said lien will be in addition
to the liens that the IRS and Quail Creek Bank had in the assets
and property of the debtor as of the petition date, which liens
extend to and encumber the proceeds and products of the property of
the Debtor in existence at the time the bankruptcy petition was
filed.
In the event of and only in case of diminution of value of the
Secured Creditors' interests in the collateral, the Secured
Creditors will be entitled to superpriority claim that will have
priority in the Debtor's bankruptcy case over all priority claims
and unsecured claims against the Debtor and its estate, now
existing or hereafter arising. This super-priority claim will be
subject and subordinate only to the CarveOut.
The CarveOut includes any fees due to the U.S. Trustee and fees and
expenses incurred by the Debtor's professionals and approved by the
Court in an amount not to exceed $20,000.
The Debtor will make post-petition monthly payments to Quail Creek
in an amount equal to the paid pre-petition, pursuant to Debtor's
pre-petition loan documents with Quail Creek. In addition,
beginning 60 days after the Petition Date, the Debtor will make
post-petition monthly payments to the IRS equal to $7,240.
The Debtor will be required to insure to its full value all
collateral subject to Quail Creek's and the IRS' liens. The Debtor
will furnish evidence of insurance to Quail Creek and the IRS upon
request.
A full-text copy of the Final Order is available at:
http://bankrupt.com/misc/okwb18-14438-38.pdf
About American Truck Training
American Truck Training Inc. is a commercial truck driving school
that was formed to address the infinite need for new and
experienced professional truck drivers in the United States.
American Truck Training sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Okla. Case No. 18-14438) on Oct. 22,
2018. In the petition signed by Jerome Redmond, owner, the Debtor
disclosed $363,000 in assets and $2,146,379 in liabilities. Judge
Sarah A. Hall presides over the case. The Debtor tapped Mitchell &
Hammond as its legal counsel.
AMISTAD READY MIX: Seeks to Hire Smeberg Law Firm as Legal Counsel
------------------------------------------------------------------
Amistad Ready Mix, Inc., seeks approval from the U.S. Bankruptcy
Court for the Western District of Texas to hire Smeberg Law Firm,
PLLC as its legal counsel.
The firm will assist the Debtor in the preparation of a bankruptcy
plan and will provide other legal services related to its Chapter
11 case.
Smeberg Law Firm will charge these hourly fees:
Ronald Smeberg, Esq. $300
Associate Attorneys $210
Legal Assistants $120
Paralegals $120
Ronald Smeberg, Esq., at Smeberg Law Firm, disclosed in a court
filing that he and other employees of his firm do not represent any
interest adverse to the Debtor and its bankruptcy estate.
The firm can be reached through:
Ronald J. Smeberg, Esq.
Smeberg Law Firm, PLLC
2010 West Kings Highway
San Antonio, TX 78201
Phone: 210-695-6684
Fax: 210-598-7357
E-mail: ron@smeberg.com
About Amistad Ready Mix
Amistad Ready Mix, Inc., based in Del Rio, Texas, is a ready mix
concrete supplier specializing in the delivery of concrete ready
mix and aggregate for use in a building's foundation, structure,
and exterior.
Amistad Ready Mix filed a Chapter 11 petition (Bankr. W.D. Tex.
Case No. 18-52645) on Nov. 5, 2018. In the petition signed by
Sergio Galindo, president, the Debtor estimated assets of $1
million to $10 million and liabilities of the same range as of the
bankruptcy filing. The case is assigned to Judge Ronald B. King.
Smeberg Law Firm, PLLC, is the Debtor's counsel.
ANDERSON FARMS: Choice Livestock Buying Equipment for $46K
----------------------------------------------------------
Anderson Farms, Inc., asks the U.S. Bankruptcy Court for the
District of Ohio to authorize the sale of Kenworth TK Truck, Semi
1NKDL00X88J232940, and Supreme 1200T Feed Wagon/Mixer OTM12028, to
Choice Livestock Transportation, Inc., for $46,000.
Objections, if any, must be filed within 21 days of the date of the
Notice.
Farm Credit Services of America, PCA ("FCSofA") has filed two
secured claims, Claim 18 and Claim 19, amounting to $6,680 and
$31,540, respectively, as of filing, plus interest and accumulated
costs. Anderson Farms proposes to sell the equipment secured by
FCSofA's lien to the Buyer for $46,000. Financing has been
arranged by the Buyer through Creative Funding, P.O. Box 2367,
Boise, ID 83701.
Anderson Farms believes that this offer is in line with the market
value of the equipment to be sold. The proceeds will be used to
satisfy Anderson Farms' obligations to FCSofA in full, including
interest and accrued attorney fees and costs and will also remove
the FCSofA's lien on a Supreme 900T Feed Wagon/Mixer SN: 190355.
The sale should net proceeds for the estate of less than $10,000.
About Anderson Farms
Anderson Farms, Inc. -- https://www.andersonfarms.org/ -- operates
a specialized freight trucking business providing a wide range of
services to the agricultural industry that suit the needs and
requirement of transporting feed to dairies and feedlots. It is
headquartered in Burley, Idaho.
Anderson Farms sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Idaho Case No. 18-40360) on April 30, 2018. In the
petition signed by Cameron Smith, director, the Debtor estimated
assets of less than $50,000 and liabilities of $1 million to $10
million. Judge Joseph M. Meier oversees the case. MAYNES TAGGART
PLLC is the Debtor's counsel.
ANDREW YOUNG: Curtis Buying Surplus' Gary Property for $28K
-----------------------------------------------------------
Surplus Management Systems, LLC, an affiliate of Andrew Young, asks
the U.S. Bankruptcy Court for the Northern District of Indiana to
authorize the private sale of the real property commonly known as
2301 Virginia Avenue, Gary, Indiana, more particularly described as
Diamond Park Subdivision, all lots 1 to 6, Block 2, and having the
tax parcel number 45-08-15-179-001.000-004, together with all
fixtures, appurtenances, and hereditaments thereunto belonging, to
Detrick Curtis for 28,200.
Prior to its petition date, on March 15, 2016, the Debtor entered
into that certain No Lien Contract for Condition Sale of Real
Estate, providing for the sale of the Real Estate to the Purchaser
for $40,000 payable through installments over two years. The
Purchaser paid the Debtor $11,800 under the Prepetition Agreement
before the Debtor's dispute with the taxing authorities and ensuing
bankruptcy filing prevented the Debtor from completing the
transaction.
As of Nov. 14, 2018, the total outstanding taxes that are claimed
to be due on the Real Estate are $41,658, which amount includes
$22,169 in delinquent taxes and $17,760 penalties related to the
Debtor's longstanding dispute with Lake County taxing authorities.
In short, a significant portion of the delinquent taxes and all of
the alleged penalties are disputed by the Debtor based on a history
of improper tax assessments -- a dispute that should have been
resolved pursuant to a Settlement Agreement between the Debtor and
Lake County that was approved by the Bankruptcy Judge Wedoff and
subsequently breached by Lake County.
On Nov. 20, 2018, the Debtor and the Purchaser entered into a new
Contract for Purchase of Real Estate, providing for the sale of the
Real Estate subject to the Court's approval.
The New Contract provides inter alia for:
(i) Purchase price payment to the Debtor in the amount of
$28,200, free and clear of all Interests, equal to the remaining
balance due from Purchaser under the Prepetition Agreement;
(ii) Entry of an order by the Court approving the New Contract
and authorizing the sale of the Real Estate to the Purchaser free
and clear of any liens, claims or encumbrances;
(iii) Delivery of a recordable quitclaim deed by the Debtor;
(iv) The Debtor's retention of liability for all taxes accrued
up to and including March 15, 2016 and the Purchaser's assumption
of responsibility for all taxes accruing from and after March 15,
2016;
(v) Closing to occur within 30 days after the Debtor obtains a
final and no longer appealable order from the Court approving the
Contract and authorizing the proposed sale, and in any event, by no
later than Jan. 31, 2019;
(vi) The Purchaser's payment of any applicable transfer taxes
or other closing costs, if any; and
(vii) Mutual general releases, including, without limitation,
any claim related to the Prepetition Agreement.
The New Contract has been negotiated at arms'-length and resolves a
potential dispute between the parties related to the Prepetition
Agreement. The current assessed value of the Real Estate is
$36,200; accordingly, the aggregate $40,000 purchase price to be
paid by the Purchaser, who has already made certain improvements to
the Real Estate in reliance on the Prepetition Agreement, reflects
a fair price for the Debtor's estate.
The proposed sale is in the best interests of the Debtor's estate
as it resolves the Purchaser's potential claim against the estate,
it will generate proceeds to pay the Debtor's tax liability once
the Lake County Treasurer's disputed claim is resolved, and it
should free up additional funds to support the Debtor's
reorganization.
The Debtor submits that, to the extent the Lake County Treasurer
objects to the proposed sale, Lake County Treasurer's claim and
related tax lien are in bona fide dispute. Just without the
exorbitant penalties, the $28,200 purchase price payment will
exceed the amount of the alleged tax liability. Moreover, the Lake
County Treasurer's tax lien will attach to the proceeds of the
proposed sale, and such proceeds will be held in the Debtor's DIP
account to secure payment of such taxes once the Court determines
how much is due and owing by the Debtor, or until the Debtor and
the Lake County Treasurer can otherwise agree on the amount due.
A copy of the APA attached to the Motion is available for free at:
http://bankrupt.com/misc/Andrew_Young_366_Sales.pdf
The Purchaser:
Detrick Curtis
200 W. 75th Ave.
Merrillville, IN 46410
The Purchaser is represented by:
Christopher R. Schmidgall, Esq.
LAW OFFICE OF WEISS, SCHMIDGALL & HIRES, P.C.
Six W. 73rd Ave.
Merrillville, IN 46410
About Andrew Young
Andrew Young sought Chapter 11 protection (Bankr. N.D. Ind. Case
No. 17-22665) on Sept. 18, 2017. About the same time, his
affiliated debtors, Andy's Truck and Equipment Co., Inc.; D.A.Y.
Investments, LLC; Gary II, LLC; Gold Coast Rand Development Corp.;
and Surplus Management Systems, LLC, also filed their petitions
pursuant to Chapter 11 of the Bankruptcy Code. On Feb. 8, 2018,
the Court entered an agreed order for joint administration of the
bankruptcy cases.
The Debtors tapped Renee M. Babcoke, Esq., at Babcoke Law Firm, as
counsel.
ANDREW YOUNG: Gary II's $7.5K Private Sale of Gary Property Okayed
------------------------------------------------------------------
Judge James R. Ahler of the U.S. Bankruptcy Court for the Northern
District of Indiana authorized the private sale by Gary II, LLC, an
affiliate of Andrew Young, of the real property commonly known as
3328 Connecticut Street, Gary, Indiana, Property Tax
#145-08-22-302-024.000-004, to The Trustees of Indiana University
or its designee for $7,500.
The sale is free and clear of all liens, encumbrances, and other
Interests, with the Purchaser to pay or assume all outstanding real
estate tax liens at the closing of the Sale, and for any other
liens, encumbrances, and other Interests to attach to the proceeds
of Sale.
The proceeds of the Sale will be deposited in the DIP account of
the Debtor, pending further order of the Court.
Pursuant to Fed. R. Bankr. P. 6001(i)(l) and N.D. Ind. L.B.R.
B-6004-1(c), the Debtor will file a Report of Sale that includes an
itemized statement of the property sold, the name of the Purchaser,
and the price received for the property, including itemization of
expenses deducted from the proceeds of Sale, if any. Said Report
will be filed with the Clerk within 10 days of completion of the
Sale, and will be served on those parties as set out in N.D. Ind.
L.B.R. B-6004-1(a).
About Andrew Young
Andrew Young sought Chapter 11 protection (Bankr. N.D. Ind. Case
No. 17-22665) on Sept. 18, 2017. About the same time, his
affiliated debtors, Andy's Truck and Equipment Co., Inc.; D.A.Y.
Investments, LLC; Gary II, LLC; Gold Coast Rand Development Corp.;
and Surplus Management Systems, LLC, also filed their petitions
pursuant to Chapter 11 of the Bankruptcy Code. On Feb. 8, 2018,
the Court entered an agreed order for joint administration of the
bankruptcy cases. The Debtors tapped Renee M. Babcoke, Esq., at
Babcoke Law Firm, as counsel.
AVERY LAND: Jan. 30 Combined Plan, Disclosure Statement Hearing
---------------------------------------------------------------
The Combined Hearing to consider approval of the disclosure
statement and confirmation of Avery Land Group, LLC's third amended
plan of reorganization will be held on Jan. 30, 2019, at 1:30 p.m.
prevailing Pacific Time before the Honorable August B. Landis. The
Combined Hearing may be continued from time to time by announcing
the continuance in open court or otherwise, without further notice
to parties in interest.
The deadline to file and serve objections to the confirmation of
the Plan, including any objection to the adequacy of the
conditionally approved Disclosure Statement and the rejection of
the Debtor's executory contracts and unexpired leases, is Jan. 16.
The deadline for submission of Ballots is Jan. 16.
Class 2(a) DIP Lender Secured Claim. The Holder of the Allowed DIP
Lender Secured Claim will, in full satisfaction, settlement,
release and exchange for the Allowed DIP Lender Secured Claim, be
issued 100% of the New Equity Interests. Class 2(a) is Impaired.
Estimated amount of claim is $40,000.
Class 2(b) Baxter Secured Claim. The Holder of the Allowed Baxter
Secured Claim will receive the following treatment: (1) the
Reorganized Debtor shall form the Baxter Subsidiary and shall
transfer the Baxter Collateral to the Baxter Subsidiary; (2) the
Baxter Subsidiary shall become a borrower under the Baxter Loan;
and (3) the Baxter Assignee shall release the Baxter Liens and
cease to be a borrower under the Baxter Loan. Class 2(b) is
impaired. Estimated amount of claim is $5,632,289.
Class 2(c) Baum Secured Claim. The Holder of the Allowed Baum
Secured Claim will receive the Baum Secured Note, which will be
secured by the Baum Collateral, will be executed by the Reorganized
Debtor, and will provide that the Holder of the Allowed Baum
Secured Claim, be paid in monthly installments of principal,
together with non-compounded interest at the rate of 5.75% per
annum, based on a 30-year amortization schedule, with all remaining
principal and interest due on the third anniversary of the
Effective Date. Class 2(c) is impaired and estimated amount of
claims is $17,337.
Class 2(d) McKenna Secured Claim. The Holder of the Allowed McKenna
Secured Claim will receive the McKenna Secured Note, which will be
secured by the McKenna Collateral will provide that the Holder of
the Allowed McKenna Secured Claim, be paid in monthly installments
of principal, together with non-compounded interest at the rate of
5.75% per annum, based on a thirty (30) year amortization schedule.
Class 2(d) is impaired with estimated amount of claim is $16,633.
Class 2(e) Thompson Secured Claim. The Holder of the Allowed
Thompson Secured Claim shall receive the Thompson Secured Note,
which will be secured by the Thompson Collateral and will provide
that the Holder of the Allowed Thompson Secured Claim, be paid in
monthly installments of principal, together with non-compounded
interest at the rate of 5.75% per annum, based on a thirty (30)
year amortization schedule. Class 2(e) is impaired with estimated
amount of claim is $25,490.00.
Class 4(a) General Unsecured Claims. Each Holder of a Class 4(a)
Allowed General Unsecured Claim shall receive a Class 4(a) Junior
Lien Note in the amount of its Claim, which shall be secured by a
Junior Lien on all Unencumbered Property, bear Post Effective Date
Interest and be paid, after satisfaction in full of the Allowed
Deferred Administrative Claims, and Pro Rata with the Allowed Class
4(b) Loftin Unsecured Claim, the Allowed Class 4(c) Cashman
Unsecured Claim and the Allowed Class 4(d) Utica Unsecured Claim,
from the proceeds of Refinancing and/or Property Sales. Class 4(a)
is impaired with estimated amount of claim $2,857,692.42.
Class 4(b). Loftin Unsecured Claim. The Holder of the Class 4(b)
Allowed Loftin Unsecured Claim shall receive the Class 4(b) Junior
Lien Note in the amount of its Claim, which shall be secured by a
Junior Lien on all Unencumbered Property, bear Post Effective Date
Interest and be paid, after satisfaction in full of the Allowed
Deferred Administrative Claims, and Pro Rata with the Allowed Class
4(a) General Unsecured Claims, the Allowed Class 4(c) Cashman
Unsecured Claim and the Allowed Class 4(d) Utica Unsecured Claim,
from the proceeds of Refinancing and/or Property Sales. Class 4(b)
is impaired with estimated amount of claim is $98,000.00.
Class 4(c) Cashman Unsecured Claim. The Holder of the Class 4(c)
Allowed Cashman Unsecured Claim shall receive the Class 4(c) Junior
Lien Note in the amount of its Claim, which shall be secured by a
Junior Lien on all Unencumbered Property, bear Post Effective Date
Interest, and be paid, after satisfaction in full of the Allowed
Deferred Administrative Claims, and Pro Rata with the Allowed Class
4(a) General Unsecured Claims, the Allowed Class 4(b) Loftin
Unsecured Claim and the Allowed Class 4(d) Utica Unsecured Claim,
from the proceeds of Refinancing and/or Property Sales. Class 4(c)
is impaired with estimated amount of claim is $32, 060.20.
Class 4(d) Utica Unsecured Claim. The Holder of the Class 4(d)
Allowed Utica Unsecured Claim shall receive the Class 4(d) Junior
Lien Note in the amount of its Claim, which shall be secured by a
Junior Lien on all Unencumbered Property, bear Post Effective Date
Interest, and be paid, after satisfaction in full of the Allowed
Deferred Administrative Claims, and Pro Rata with the Allowed Class
4(a) General Unsecured Claims, the Allowed Class 4(b) Loftin
Unsecured Claim and the Allowed Class 4(c) Cashman Unsecured Claim,
from the proceeds of Refinancing and/or Property Sales. Class 4(d)
is impaired with estimated amount of claim is $427,163.75.
Class 5 Insider Claims. Each Holder of a Class 5 Allowed Insider
Claim shall, in full satisfaction, settlement, release and exchange
for such Allowed Insider Claim, receive its Pro Rata share of the
Insider Claim Fund. Class 5 is impaired with estimated amount of
Claim is $913,485.01.
Class 6 Old Equity Interests. All Old Equity Interests shall be
extinguished on the Effective Date. Class 6 is Impaired. Because
the Holders of Class 6 Allowed Old Equity Interests will not
receive or retain any property under the Plan on account of such
Interests, they are conclusively deemed to have rejected the Plan
under Bankruptcy Code section 1126(g).
On the Effective Date: (1) the Reorganized Debtor shall form the
Baxter Subsidiary and shall transfer the Baxter Collateral to the
Baxter Subsidiary; (2) the Baxter Subsidiary shall become a
borrower under the Baxter Loan; and (3) the Baxter Assignee shall
release the Baxter Liens and cease to be a borrower under the
Baxter Loan. On the Effective Date, the Reorganized Debtor shall
transfer all of its Assets other than the Baxter Collateral and the
Surrendered Collateral to HB Farms. In exchange: (i) Cashton shall
provide the Exit Financing; (ii) the Reorganized Debtor shall
receive membership interests in HB Farms; and (iii) HB Farms shall
assume all of the Reorganized Debtor’s obligations under the Baum
Secured Note, the McKenna Secured Note, the Thompson Secured Note,
the Class 4(a) Junior Lien Notes, the Class 4(b) Junior Lien Note,
the Class 4(c) Junior Lien Note, and the Class 4(d) Junior Lien
Note. The Exit Financing shall be converted into membership
interests in HB Farms upon the Reorganized Debtor’s contribution
of its Assets to HB Farms. The Exit Financing and the DIP Loan
shall be used to provide all Confirmation Funds for Distribution
pursuant to this Plan.
A full-text copy of the Disclosure Statement dated December 10,
2018, is available at:
http://bankrupt.com/misc/nvb18-1614995abl-699.pdf
About Avery Land Group
Avery Land Group, LLC, has been in business since 2013 in the
development of agricultural land and planned residential
communities.
Kingman Farms parent company Avery Land Group, LLC, based in Las
Vegas, NV, filed a Chapter 11 petition (Bankr. D. Nev. Case No.
16-14995) on Sept. 9, 2016. In the petition signed by Manager
James M. Rhodes, the Debtor estimated assets at $500,000 to $1
million and liabilities at $1 million to $10 million.
The Hon. August B. Landis is the case judge.
The Debtor tapped Brett A. Axelrod, Esq., at Fox Rothschild, LLP,
as bankruptcy counsel, and The Bach Law Firm, LLC, as conflicts
counsel.
No official committee of unsecured creditors has been appointed in
the case.
CAFE HOLDINGS: Seeks to Hire Duff & Phelps as Investment Banker
---------------------------------------------------------------
Cafe Holdings Corp. seeks approval from the U.S. Bankruptcy Court
for the District of South Carolina to hire Duff & Phelps
Securities, LLC, as investment banker.
The firm will assist the company and its affiliates in evaluating,
structuring, negotiating and implementing the terms and conditions
of any sale, restructuring or financing transaction.
Duff & Phelps' agreement with the Debtors provides for an initial
fee of $25,000 and a monthly fee of $25,000.
If a sale occurs during the term of the agreement or within 18
months following the termination of the agreement, the Debtors will
pay the firm at the closing of the sale a non-refundable cash fee
equal to the sum of (i) 4% of any consideration up to $10 million,
and (ii) 6% of any consideration in excess of $10 million, subject
to a minimum of $450,000.
If a restructuring transaction is consummated, Duff & Phelps will
receive a fee in cash equal to (i) 4% of any restructuring value up
to $10 million, and (ii) 6% of any restructuring value in excess of
$10 million, subject to a minimum of $450,000.
Meanwhile, if a financing transaction is consummated, the firm will
be entitled to receive upon the first and any subsequent closing of
the sale of any securities or financing placement a cash fee equal
to (i) 3% of the principal amount of any senior secured debt
raised, plus (ii) 4.5% of the principal amount of any second lien
debt, unsecured debt, mezzanine debt or preferred equity raised,
plus (iii) 6% of the agreed value of any equity raised.
Prior to the petition date, the Debtors paid the firm the initial
fee, monthly fees totaling $175,000, and expenses totaling
$11,856.68.
Vineet Batra, managing director of Duff & Phelps, disclosed in a
court filing that the firm is "disinterested" as defined in Section
101(14) of the Bankruptcy Code.
Duff & Phelps can be reached through:
Vineet Batra
Duff & Phelps Securities, LLC
55 East 52nd Street 31st Floor
New York NY 10055 USA
Phone: +1 212-871-2000
About Cafe Holdings Corp.
Cafe Enterprises, Inc. -- http://www.fatz.com/-- and its
subsidiaries are privately-owned operators of casual dining
restaurant brand, "Fatz Cafe", with headquarters in Taylors, South
Carolina. They operate 38 locations spread across five states.
The Debtors employ nearly
1,700 persons.
Cafe Holdings Corp., Cafe Enterprises, Inc., CE Sportz LLC and CES
Gastonia LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. S.C. Lead Case No. 18-05837) on Nov. 15, 2018. At
the time of the filing, the Debtors disclosed $23 million in assets
and $51 million in liabilities.
The cases have been assigned to Judge Helen E. Burris.
The Debtors tapped Haynes and Boone, LLP as their bankruptcy
counsel; McNair Law Firm, PA as local counsel; Loughlin Management
Partners + Company as financial advisor; Duff & Phelps, LLC as
investment banker; and Donlin Recano & Company, Inc. as claims and
noticing agent.
The U.S. Trustee for Region 4 appointed an official committee of
unsecured creditors on Nov. 28, 2018. The committee tapped
Pachulski Stang Ziehl & Jones LLP and Nelson Mullins Riley &
Scarborough LLP as its legal counsel.
CF INDUSTRIES: S&P Alters Outlook to Stable & Affirms 'BB+' ICR
---------------------------------------------------------------
S&P Global Ratings revised its outlook to stable from negative and
affirmed its issuer credit rating at 'BB+'. S&P said, "We also
affirmed our issue-level and recovery ratings on the company's
secured notes and revolving credit facility at 'BBB-' and '1',
respectively, and on the unsecured debt at 'BB+' and '4',
respectively."
Pricing for CF Industries Inc.'s nitrogen-based fertilizer products
including urea have firmed up in 2018, contributing to better
operating performance. S&P said, "We anticipate this improvement
will be sustainable at least over the next 12 months. The improved
operating performance has strengthened credit metrics, including
the funds from operations-to-total debt ratio, which we expect will
be at least 20% over the next 12 months."
S&P said, "The outlook revision on CF Industries to stable from
negative reflects our assumption that the recently stronger prices
in the second half of 2018 for urea, ammonia, and other
nitrogen-based products will be sustained at least over the next 12
months. We believe the resulting improvement in credit metrics,
including the funds from operations (FFO)-to-total debt ratio to
20% and above, will hold. This key credit ratio has been weaker
than our expectations at 20% for most of 2017 and early 2018.
"The stable outlook reflects our view that the recent improvement
in CF Industries' operating performance and credit metrics is
sustainable. We do not anticipate any supply shocks in the form of
large capacity additions that will reverse the recent price
improvement, nor do we anticipate demand weaknesses arising out of
weather-related events or a general slowdown in the use of
nitrogen-based fertilizer. Our outlook remains favorable in terms
of the long-term demand growth trends. We do not believe future
shareholder rewards, growth plans, or acquisitions will increase
levels beyond our range of expectation. We believe that capital
spending that peaked in 2015 and 2016 will continue at the
significantly lower levels achieved since then. In our base case we
expect an FFO-to-total adjusted debt ratio of at least 20%.
"We could lower the rating over the next 12 months if operating
performance weakens unexpectedly or debt rises such that FFO to
total debt falls below 20% on a weighted average basis with no
prospect for improvement. We considered two historical years and
two future years in our weighted average calculation, which offsets
the risk of sustained weakness in this ratio from brief, sharp
downturns in operating performance. However, if we anticipate that
FFO to total debt will consistently be below 20% on a
weighted-average basis, we would consider a downgrade. This could
happen through several combinations of revenue and margin
deterioration, including a sharp decline in revenues or a sustained
decrease in EBITDA margins by a few percentage points each year
relative to our expectations.
"We believe that the sector remains susceptible to unexpected event
risks. If management, against our expectation, stretches the
financial profile to pursue additional growth objectives or
shareholder rewards, any operating setback could be exacerbated and
potentially weaken metrics, which could result in a downgrade. We
could also lower the rating if there are major operational risks
from bringing on new expanded capacity at the company's existing
plants.
"Although unlikely, we could raise the rating over the next 12
months if we expect FFO to debt to improve to about 45% for a
sustained period, with the expectation that in a future downturn
the ratio would remain above 30%. We believe that FFO to debt could
exceed 30% for brief periods; however, we would also consider the
volatility in earnings in the nitrogen fertilizer business and
assess the sustainability of such improvement before considering a
positive rating action.
"We could also consider an upgrade if the company maintains steady
revenue growth, combined with EBITDA margins that exceed our
expectations by more than four percentage points on a sustained
basis, which could significantly improve credit measures, with a
pro forma weighted average FFO to debt of above 45% even in
industry troughs. To consider an investment-grade rating, we would
also have to believe that management was committed to maintaining
or improving credit measures, and that the potential for
debt-funded transformational acquisition was remote."
CHAMPION BLDRS: Proposes Auction of Personal Property on Jan. 23
----------------------------------------------------------------
Champion Bldrs., LLC, asks the U.S. Bankruptcy Court for the
District of Kansas to authorize the sale of all its right, title,
and interest in and to the personal property at auction to be
conducted at 1836 SW 65th Street, Topeka, Kansas on Jan. 23, 2019
at 9:30 a.m.
The personal property is secured to Alliance Bank under various
Security Agreement(s) and UCC Financing Statements. The
approximate balance due is the total sum of $839,114 as of Dec. 3,
2018. No Proof of Claim has been filed by Alliance Bank at this
juncture.
The personal property will be subject to unpaid ad valorem taxes
that will be due the Shawnee County Treasurer. It will be sold
free and clear of any claimed liens and encumbrances of record,
with the balance of the proceeds paid to the secured creditor
Alliance Bank.
The personal property has not been claimed as exempt by the Debtor
or any other person entitled to assert the Debtor's exemptions
under federal or state law. It will be sold to the highest bidder,
and said personal property will be sold in its present condition
with no express or implied warranties, and the purchaser is to
accept said property in its present condition.
The sale will be free and clear of all liens and encumbrances of
record, and in the event of any mortgage or security interest in
and to said property to be sold, the mortgage or security interest
will be transferred to the proceeds of sale. A significant benefit
will be realized by any secured creditor to the extent of receipt
of proceeds through distribution upon closing of this transaction.
The cost of sale will include reasonable and necessary expenses
allocated on a pro rata basis to the extent of participation in the
proceeds including, but not limited to, the following: (i) ad
valorem taxes due the Shawnee County Treasurer; (ii) auctioneer's
commission to Bud Palmer Auction in the sum of 15%; (iii)
auctioneer's expenses for advertising ($1,000) and set up ($300) in
thetotal estimated sum of $1,300; (iv) the Debtor's attorneys fees
in the sum of $2,500 for time associated with organizing the sale,
preparation of various motions, orders and Court hearing; (v) the
estimated postage and photocopying expense in the sum of $100; (vi)
filing fee of the Motion for Sale in the amount of $181; and (vii)
the United States Trustee fees calculated in the estimated amount
of $1,625.
The remaining proceeds will be held pending the filing of a Proof
of Claim by Alliance Bank substantiating its liens on equipment,
personal property and motor vehicles. Upon substantiation of
perfection, a separate motion to distribute funds to Alliance Bank
will be filed by the Debtor. The expenses set forth will be paid
under separate application and order.
Objections to the sale of the personal property and the payment of
the ad valorem taxes, auctioneer's commission, attorneys' fees,
other administrative expenses of sale and disbursement procedure
should be made by Dec. 31, 2018. If no objections are made to the
payment foregoing items, then the Court may enter an Order
approving said costs and disbursing the funds from the sale without
further notice to all creditors. In the event an objection is
filed, a hearing on the objection will be held on Jan. 10, 2019, at
10:30 a.m.
A copy of the list of assets to be sold attached to the Motion is
available for free at:
http://bankrupt.com/misc/Champion_Bldrs_42_Sales.pdf
About Champion Bldrs.
Champion Bldrs, LLC, based in Topeka, KS, filed a Chapter 11
petition (Bankr. D. Kan. Case No. 18-12175) on Nov. 6, 2018. In
the petition signed by Greg L. Murray, president/manager, the
Debtor disclosed $1,964,150 in assets and $3,411,715 in
liabilities. The Hon. Robert E. Nugent presides over the case.
Edward J. Nazar, Esq., at Hinkle Law Firm LLC, serves as bankruptcy
counsel.
CHRISTIAN RADABAUGH, SR: Closing Cattle Sales
---------------------------------------------
Christian S. Radabaugh, Sr., asks the U.S. Bankruptcy Court for the
District of Oregon on an emergency basis, to authorize the closing
of the cattle sales outside the ordinary course of business that
the Debtor agreed to prior to the filing of the petition; and to
authorize the sale of cattle scheduled for Dec. 14, 2018.
The Debtor's livestock is encumbered by a security interest granted
to GP, LLC, which was perfected on April 13, 2017, by the filing of
a Farm Products Financing Statement Standard Form, EFS-1 No.
91156751 and a UCC-1 Financing Statement filed on April 13, 2017,
No.
91156100. As of the date of the petition, the Debtor owes GP, LLC
approximately $2 million. The exact amount Debtor owes to GP can
be determined by reference to that certain judgment and money award
entered against Debtor and in favor of GP, LLC in Crook County
Circuit Court Case No. 18CV52765. The interest continues to accrue
on the judgment at the rate of 10 percent per annum.
During the two-week period prior to the filing of the petition, at
the request of GP, LLC, the Debtor agreed to sell approximately 542
head of cattle through a video auction conducted by Shasta
Livestock Auction Yard in Cottonwood, California. The video
auction was conducted, and agreements were reached to sell the
cattle to the Buyers, for agreed-upon prices. Pursuant to these
agreements, the Debtor is to deliver the 542 head of cattle on Dec.
11 and 12, 2018.
Additionally, just prior to the filing of the petition, the Debtor
agreed to let GP, LLC remove 305 head of cattle, primarily mother
cows, and ship such livestock to the Shasta Livestock Auction Yard
for sale. The cattle are scheduled to be sold on Dec. 14, 2018.
The majority of the proceeds would be used to pay GP, LLC, to
reduce the amount of the judgment against the Debtor. In order to
deliver the cattle that is due for delivery today, the Debtor
arranged for trucks to pick up the cattle beginning the morning,
and for an Oregon brand inspector to inspect the brands to permit
transit. Trucks and brand inspections have also been made for the
delivery of cattle that is due to be delivered tomorrow. These
arrangements were made prior to filing chapter 11 and would be
costly to the estate and disruptive the sale process to stop.
The Debtor's credibility as a seller of livestock would be impaired
if he fails to complete timely delivery of the livestock as it had
agreed to do. Furthermore, if the Debtor fails to deliver the
livestock as he is required to do, it would incur substantial
additional costs for feed and care of the livestock. The Debtor
does not have consent or a court order to use cash collateral and
in any event, has very limited funds available.
With respect to the cattle scheduled to be sold on Dec. 14, 2018,
if that sale does not occur, then the Debtor will incur additional
costs (with limited funds available) for feed, care, and storage of
the cattle at Shasta Livestock that can be avoided by the proposed
sale.
The sale at Shasta Livestock was an arms'-length transaction and
was conducted by Shasta Livestock. The Purchaser is not related to
the Debtor or any of its principals. The sale at Shasta Livestock
scheduled for Dec. 14, 2018 will be an arms'-length transaction and
will be conducted by Shasta Livestock.
The Debtor asks entry of an order authorizing the delivery to the
Buyer of the cattle sold prior to the petition, and authorizing the
sale of the cattle that have been shipped to Shasta Livestock
Auction Yard.
The Chapter 11 case is In re Christian S. Radabaugh, Sr. (Bankr. D.
Ore. Case No. 18-34244).
Counsel for the Debtor:
Nicholas J. Henderson, Esq.
MOTSCHENBACHER & BLATTNER LLP
117 SW Taylor Street, Suite 300
Portland, OR 97204
Telephone: (503) 417-0508
E-mail: nhenderson@portlaw.com
CIRCLE 9 CATTLE: Schuett Buying Whitehall Property for $5.1 Million
-------------------------------------------------------------------
Circle 9 Cattle Company, LLC, asks the U.S. Bankruptcy Court for
the District of Maine to authorize the sale of substantially all
property, consisting of a ranch property located at 502 Waterloo
Road and 38 Loomont Lane, Whitehall, Montana, and certain personal
property used in connection with that ranch, to David Schuett in
accordance with the Offer and Agreement for Sale and Purchase for
$5.129 million.
Prior to the Petition Date, the Debtor and related entities,
including McClinch, entered into various loan agreements with
various lenders, as well modifications and settlement agreements
regarding such loans. In order to secure the indebtedness owed to
the various lenders under the loan agreements, the Debtor granted
such lenders security interests in some or all of the Property.
Specifically, these lenders may assert an interest in some or all
of the Property (the lenders are presented in order of highest
priority lien rights to lowest priority lien rights):
A. On Dec. 23, 2013, Cross Land and Cattle, LLC executed a
promissory note with First Interstate Bank in the original
principal sum of $1.9 million. To secure the obligations related
to the First Interstate Note, the Debtor executed and delivered to
First Interstate a mortgage on the Debtor's real property.
B. On Nov. 22, 2016, Candlelight Farms Aviation, LLC executed
a promissory note with Coastal Realty Capital, LLC in the original
principal sum of $650,000 (later increased to $750,000). To secure
the indebtedness on the Coastal Note, the Debtor executed and
delivered to Coastal a mortgage on the Debtor's real property.
C. On Aug. 30, 2017, Boothbay Harbor Shipyard, LLC executed a
promissory note with TPL Financial in the original principal sum of
$715,000. To secure the indebtedness on the TPL Note, the Debtor
executed and delivered to TPL a mortgage on its real property.
D. On Sept. 8, 2017, the Debtor executed an unlimited personal
guaranty related to a commercial promissory note in the original
principal amount of $600,000 executed by 120 Commercial Street
Realty, LLC and Boothbay Harbor Shipyard, LLC, and payable to CNB.
To secure the obligations related to the CNB Note, the Debtor
executed and delivered to CNB a mortgage on the Debtor's real
property.
On Nov. 30, 2018, the Debtor and the Buyer entered into the
Agreement.
The terms of the Agreement are:
A. Purchase Price: $5,129,000, free and clear of all liens,
claims, and encumbrances. The Purchase Price will be paid as
follows:
i. The sum of $25,000 as refundable earnest money will be
paid by Buyer within five business days of the Seller's execution
of the Agreement provided that all contingencies required of Seller
prior to that date are satisfied in full;
ii. The sum of $200,000 will be applied at closing to
reduce the Purchase Price as a credit for the sum owed to the Buyer
by Seller under the Lease; and
iii. The balance of the Purchase Price, less the Earnest
Money and the Credit, which remaining balance is the amount of
$4,904,000, will be paid at closing contingent upon satisfaction of
all terms, contingencies, warranties, conditions and matters in the
Agreement.
B. Financing Contingency: It is a contingency for closing that
the Buyer can secure financing on terms solely satisfactory to
Buyer from its chosen lender for the purpose of completing the
purchase of the Property under the terms of the Agreement.
C. Expense Reimbursement Sum: In the event that the Seller
fails to obtain the Order on Dec. 21, 2018, or such additional time
as agreed by the Buyer in writing, which failure is the result of a
sale of the Property to a third party, conversion of the case to a
Chapter 7 or the appointment of a Chapter 11 trustee who fails to
promptly and timely obtain the Order to permit the transaction
contemplated to be timely closed, then Buyer will be entitled to an
administrative priority claim against the bankruptcy estate of the
Seller, for the reimbursement of all fees, costs and payments
incurred by the Buyer to create and effectuate the Agreement,
including the Buyer's reasonable attorney fees and costs, and to
obtain financing for payment of the Purchase Price, in a collective
amount not to exceed the sum of $25,000.
D. Closing: The Closing will occur only if all contingencies
set forth in the Agreement are satisfied and only upon the entry of
the Order in the form and manner stated. The closing date for the
purchase of the Property will be on Jan. 18, 2019, unless such date
is required to be extended by reason of the finalization of a
lender appraisal for the Property or because it is required by the
closing agent or title insurer or because additional time is
required to ensure that the Order is not subject to appeal or
unless extended by mutual agreement of the parties in writing.
On Oct. 14, 2017, the Debtor executed an exclusive listing
agreement with Hall & Hall, a Montana real estate brokerage firm,
for the marketing and sale of the Property. Through the Motion,
the Debtor asks the Court's approval to pay a commission to Hall &
Hall for its services on behalf of the Debtor as part of the
distribution of the proceeds upon closing of the sale.
Specifically, Hall & Hall has agreed to accept in full satisfaction
of its commission the amount of $169,257, which constitutes 55% of
6% of the Purchase Price.
The counsel for the Debtor is not admitted to practice in Montana,
and the Debtor, therefore, asks authority to retain and pay local
counsel in Montana to assist the Debtor with closing the sale.
Buyer is represented by counsel in Montana, and the Debtor believes
it is in the best interests of the estate and creditors for the
Debtor to be represented in the sale transaction by an attorney in
Montana who is familiar with such transactions and Montana laws.
The Debtor, therefore, asks authority to retain and pay such local
counsel through proceeds of the sale at closing based on the
counsel's market rate, in an amount not more than $5,000.
Premised on the foregoing, the Debtor asks that the Court
authorizes the Debtor to distribute the proceeds from the sale of
the Property upon the closing of the sale as follows (certain
amounts may change premised on actual attorneys' fees and costs of
parties entitled to collect such amounts from the Debtor and
premised on interest charges and the date of closing (based on per
diem adjustments)):
Total Sale Proceeds $5,129,000
Distribution of Proceeds at Closing
Lease Credit $200,000
Broker Commission $169,257
U.S. Trustee Fees $51,290
Title Costs $9,611
Coastal $1,210,754
Coastal - Default Fee $108,394
TPL $775,899
CNB $516,211
Estimated Administrative expenses $40,000
Local Montana Counsel $5,000
----------
Total Distribution: $5,017,519
----------
Remaining Proceeds Held by the Debtor $111,480
Following the closing, the Debtor will no longer own a material
amount of property or have any ongoing operations. In addition,
the distribution of the proceeds as set forth above will result in
satisfaction of the Debtor's creditors, either immediately upon
closing or through amounts reserved in escrow pending further
determinations of amounts owed. The Debtor, therefore, asks Court
approval to distribute the remaining proceeds from the sale to
McClinch, as the sole member and equity holder of the Debtor, with
such proceeds to be administered as part of McClinch's bankruptcy
case.
The Debtor asks that the Court authorizes the dismissal of the
Debtor's bankruptcy case, contingent upon: (i) the closing of the
sale in accordance with the Agreement, including the passage of the
time for appeal after entry of the final Order approving the sale
of the Property to the Buyer; and (ii) resolving the remaining
disputes regarding the amounts owed to creditors.
A copy of the APA attached to the Motion is available for free at:
http://bankrupt.com/misc/Circle_9_Cattle_76_Sales.pdf
About Circle 9 Cattle Company
Circle 9 Cattle Company, LLC, filed a Chapter 11 petition (Bankr.
D. Me. Case No. 18-10569) on September 27, 2018, and is represented
by Sam D. Anderson, Esq. in Portland, Maine. In the petition
signed by Terrance J. McClinch, sole member, the Debtor estimated
$1 million to $10 million in assets and $0 to $50,000 in
liabilities as of the bankruptcy filing.
COLORADO WICH: Sondergaard Buying All Assets for $675K
------------------------------------------------------
Colorado Wich, Inc., and Colorado Wich, LLC, ask the U.S.
Bankruptcy Court for the District of Colorado to authorize the sale
of substantially all assets to Dave Sondergaard and/or his assign
for $675,000.
Colorado Wich, LLC operates a franchise called Which Wich Superior
Sandwich Shops and owns and operates eight retail locations in the
Denver metro area and along the Front Range in the State of
Colorado. Which Wich specializes in custom sandwich-making.
Colorado Wich, LLC employs approximately 84 people, including the
principal of the Debtor, Jeffrey Gordan, who is the managing member
or president of the respective Debtors.
The Debtors as tenant leases eight retail store locations pursuant
to these Leases:
A. Cornerstar Lease dated Nov. 26, 2007, Colorado Wich –
Cornerstar, LLC Tenant, BRE DDR BR Cornerstar Co. LLC, Landlord,
Expires November of 2018.
B. Crestline Lease dated Nov. 23, 2012, Colorado Wich –
Crestline, LLC Tenant, Plaza on the Green, LLC, Landlord, Lease
assumed and extended per Court order allowing assumption, dated
June 28, 2018
C. Colorado Mills Lease dated March 26, 2010, Colorado Wich-
Colorado Mills LLC Tenant, Burgundy Partners, LLC, Landlord,
Expires March of 2020
D. DTC Lease dated Oct. 1, 2011, Colorado Wich – DTC, LLC
Tenant, MR Marina Square LLC, Landlord, Expires October 2021
E. Lonetree Lease dated Jan. 4, 2007, Color Wich-Lonetree LLC,
Tenant, Meadows Manager 05, LLC Landlord, Expires May 2022
F. Highlands Ranch Lease dated April 21, 2010, Colorado Wich
– Highlands Ranch TCN LLC, Tenant, Shea Homes – TCN 1 LLC,
Landlord, Expires April 2020
G. Colorado & Evans Lease dated March 3, 2010, Colorado Wich
– EvCo, LLC Tenant, UPSC LLC Landlord, Expires March of 2020
H. Orchard Town Center Lease dated Jan. 23, 1997 -Extension
Dated May 1, 2018, Colorado Wich – Orchards, LLC Tenant, Vestar
Orchard Town Center LLC, Landlord, Expires April 2028
The lease for the location commonly known as Crestline has been
assumed by the Debtors pursuant to an Order of the Court dated June
28, 2018. The Debtors decided not to renew its lease for the
Cornerstar location which expired by its own terms in November of
2018. The Court granted the Debtors an extension of the exclusive
period to file their Joint Plan through and including Nov. 8, 2018,
and to assume or reject Commercial Leases, Court's Minute Order,
dated Sept. 13, 2018.
The Debtors have filed timely their Joint Plan and Disclosure
Statement which provides for the assumption of the Debtors' Leases
described and further provides for the sale of the Debtors' assets,
including Leases and inventory and equipment.
With the Court's approval, the Debtors retained We Sell Restaurants
Inc. on Sept. 17, 2018 to market and sell seven of the Debtor's
eight retail locations. With the assistance of the Broker, the
Debtors have obtained an offer to purchase all seven of the
Debtor's remaining retail locations, assume all the related Leases,
post new security deposits, purchase the equipment and inventory on
location at the time of the sale, which constitutes substantially
all of the Debtors' assets exclusive of security deposits and
accounts receivable, for a total purchase price of $675,000.
The parties have entered into their proposed Asset Purchase
Contract dated Dec. 10, 2018. The Debtor has accepted the Purchase
Offer subject to Court approval of the Motion. The Purchase Offer
is a 100% cash offer but is subject to acceptable financing which
must be in place within on Dec. 31, 2018 and successful training
and certification as a franchisee by Which Wich Inc., the
franchisor. The closing of the proposed sale is for on March 1,
2019, but the Debtors hope to accelerate the closing to no later
than the end of January 2019 or early February 2019.
To that end, contemporaneous with the filing of the Motion, the
Debtor is filing its Motion to Shorten Notice, asking to shorten
the notice period for the Motion to 10 days.
The Motion furthers the objectives set forth in the Joint Plan and
(1) insures the continued employment of over 80 hourly workers of
the Debtors whose employment is an important factor in keeping the
store locations open and operating; (2) protects the goodwill and
business reputation of the Debtors in the business community; (3)
insures that senior secured and unsecured priority debt is paid in
full; and (4) provides more of a return to creditors for the
Debtors' assets than would be obtained in either a forced
liquidation of Debtors' assets or the surrender and sale to the
Which Wich franchisor, or any other viable alternative to maximize
the Debtors' assets. All creditors, including the secured lenders,
will be best served by allowing the uninterrupted and continued
operations of the Debtors.
Colorado Wich, LLC has three separate secured lenders with loan
obligations of varying types and amounts totaling approximately
$927,961 as follows:
a. Accel Capital Inc. and Accel Capital, LLC: There are two
loan obligations to Accel, the first a Note dated Nov. 22, 2017
with a March 31, 2017 scheduled amount due of $307,516, and a
second Note dated Feb. 15, 2018 with a balance of $264,133 on March
31, 2018. The notes are secured by substantially all the Debtor's
assets, including cash collateral in the form of future accounts
and accounts receivables as evidenced by two UCC-1 Financing
Statements. The balances owed on March 31, 2018 the loans with
Accel are as follows: (i) Loan A - $307,516, and (ii) Loan B -
$264,133. Accel is in a junior position in the Debtor Colorado
Wich, LLC's assets.
b. Citywide Bank, formerly known as Millennium Bank: Colorado
Wich, LLC is indebted to Citywide on a secured Note obligation
dated Jan. 27, 2012, secured by substantially all of the Debtor's
assets with the exception of the Crestline Which location which is
secured by a note to Meadows Bank. The scheduled amount of the
secured claim of Citywide is $224,981, plus fees, costs and
accruing interest. Citywide asserts it has perfected liens on the
assets of the Debtor by virtue of the UCC-1 Financing Statement
filed by Millennium Bank with the Colorado Secretary of State as
follows: UCC Financing Statement, Recorded Jan. 27, 2012 at
Reception No 2012F00556. Citywide asserts it has a senior position
in Colorado Wich LLC's assets.
c. JP Morgan Chase Bank: Colorado Wich, LLC has a secured loan
obligation with Chase with a scheduled amount owed of $18,990.
Under the terms of the loan the Debtor granted Citywide a security
interest in, among other things, its accounts, equipment, and
general intangibles. Chase asserts it perfected its lien by
recording a Financing Statement with the Colorado Secretary of
State on April 13, 2010 at Reception No. 20102030229. As of the
Petition Date, Chase asserted that it was owed a total of
approximately $18,990 plus accrued interest, attorneys fees and
charges. Chase is in a junior position in Colorado Wich, LLC's
assets. It also asserts a lien in the assets of Colorado Wich,
Inc., the companion case filing to Colorado Wich. LLC. The amount
of the asserted secured claim is scheduled at $19,365.
d. Meadows Bank – SBA Loan: In early January of 2015
Colorado Wich, LLC incurred a secured loan obligation with Meadows
Bank and obtained an SBA Loan with a scheduled amount owed of
$112,371. Under the terms of the loan Colorado Wich, LLC granted
Meadows a security interest in its accounts, equipment, and general
of the Debtor's store locations on Academy Boulevard in Colorado,
Springs and the Crestline store in Littleton only. As of the
Petition Date, Meadows Bank asserted that it was owed a total of
approximately $112,371, plus accrued interest, attorneys' fees, and
charges. Meadow's lien position priority is unknown and may be in
a junior position in Colorado Which, LLC' assets described in the
UCC-1 filings.
e. Everest Business Capital: Everest Business Funding filed
Proof of Claim No. 18 on June 27, 2018 in the amount of $75,395 and
asserted a UCC-1 lien in the Debtor's cash and future receipts in a
fashion similar to that of Accel Capital Inc., and Accel Capital,
LLC. Everest's lien position priority is unknown but is clearly in
a junior position in the Debtor's assets described in its UCC-1
filings.
Colorado Wich, Inc. is a non-operating entity and has one secured
loan obligation as described above to Chase in the amount of
$18,990. Chase asserts it perfected its lien by recording a UCC-1
Financing Statement with the Colorado Secretary of State on April
13, 2010 at Reception No. 20102030227. As of the Petition Date,
Chase asserted that it was owed a total of approximately $18,990,
plus accrued interest, attorneys' fees and charges. Chase is in a
senior position in Debtor Colorado Wich Inc., assets, which are of
de minimis value.
The Purchase Offer is in an amount sufficient to pay all secured
and all senior unsecured priority claims. It is not anticipated
that any sale proceeds will be left for general unsecured
claimants, but the sale does carve out security deposits which have
an estimated value of $40,000 and accounts receivables, which are
de minimis. All Article V avoidance actions are being retained as
well. Priority unsecured claims are likely to receive
distributions. The Debtors therefore respectfully submit that a
prompt sale is in the best interest of creditors and will maximize
the amount that creditors may realize on account of their claims in
the case.
The Debtor is also asking authorization to sell substantially all
its assets free and clear of liens, claims and encumbrances and
other interests.
The Debtor asks authority to pay the following liens at closing:
(a) Colorado Dept of Revenue – senior sales tax lien in the
amount of $104,207; (b) Citywide Bank senior debt in the
approximate amount of $228,678; (c) Meadows Bank senior debt in the
approximate amount of $112,795; and (d) Chase Bank senior debt in
an estimated amount of $18,898.
The counties of Denver, Douglas, Arapahoe, El Paso, Jefferson and
Yuma and the municipalities of the Cities of Aurora, Lakewood, Lone
Tree, Westminster, and Denver, Colorado have each filed priority
claims for Business Personal Property and other taxes owed in an
aggregate amount $98,696. Many of these liens are disputed and
they will attach to the sale proceeds with the same validity,
priority and perfection, and to the same extent as may exist in the
Debtors assets upon its sale. The IRS has filed a proof of claim
in the amount of $127,780 for unassessed liability for the Debtor's
payroll tax obligations and corporate income taxes. To the extent
proceeds are left after all senior secured debt is paid, this
priority unsecured claim would likely consume most of the remainder
of any unencumbered sale proceeds. The payment of any claims other
the four listed above to be paid at the closing will be treated as
set forth in the Debtor's Joint Plan.
The Debtor also ask authority to pay from the sale proceeds the
Broker's commission earned from the consummation of the Sale as set
forth in the already approved listing agreement in the amount of
12% of the sales price or $81,000.
The Debtors in their Plan have already provided for the assumption
of the Leases. The Motion expressly furthers that intent by
formally assuming the following executory contracts and/or
unexpired leases and assigning them to the Purchaser, they are:
a. Crestline Lease dated Nov. 23, 2012, Colorado Wich -
Crestline, LLC, Tenant, Plaza on the Green LLC, Landlord, Lease
assumed and extended per Court order allowing assumption, dated
June 28, 2018
b. Colorado Mills Lease dated March 26, 2010, Colorado Wich -
Colorado Mills, LLC, Tenant, Burgundy Partners LLC, Landlord,
Expires March of 2020
c. DTC Lease dated Oct. 1, 2011, Colorado Wich - DTC, LLC
Tenant, MR Marina Square LLC, Landlord, Expires October 2021
d. Lonetree Lease dated Jan. 4, 2007, Color Wich-Lonetree LLC,
Tenant, Meadows Manager 05, LLC, Landlord, Expires May 2022
e. Highlands Ranch Lease dated April 21, 2010, Colorado Wich -
Highlands Ranch TCN LLC, Tenant, Shea Homes – TCN 1 LLC,
Landlord, Expires April 20
f. Colorado & Evans Lease dated March 3, 2010, Colorado Wich -
EvCo, LLC, Tenant, UPSC LLC Landlord, Expires March of 2020
g. Orchard Town Center Lease dated Jan. 23, 1997 - Extension
Dated May 1, 2018, Colorado Wich - Orchards, LLC, Tenant, Vestar
Orchard Town Center, LLC, Landlord, Expires April 2028
h. All machinery and equipment leases including but not
limited to Master EFA Agreement ME 00140539, CIT Direct capital
i. All franchise agreements and contracts on any kind between
the Debtors and Wich Wich Corp., the franchisor, or its assigns and
designees
At the closing or beforehand, the Debtors will cure any
pre-petition default under the unexpired Leases described as set
forth in Exhibit 2, or as otherwise agreed to by the Debtors and
the respective landlords. Pursuant to Section 365(f)(1) the
assumption and assignment of the Leases is permitted. The
landlords' interests in this case are more than adequately
protected by the new tenants and new security deposits. The new
tenant will be better situated to honor the remainder of the
assigned Leases.
All proceeds remaining after the closing will be paid to the
Debtors and held in the DIP account.
A copy of the Contract attached to the Motion is available for free
at:
http://bankrupt.com/misc/Colorado_Wich_169_Sales.pdf
The Purchaser:
Dave Sondergaard
7240 West Custer Ave., 206
Lakewood, CO 80226
About Colorado Wich
Colorado Wich LLC is a privately-held company in Highlands Ranch,
Colorado engaged in the business of selling sandwiches. Colorado
Wich Inc. is merely a holding company for Colorado Wich LLC, which
is the actual operating Debtor entity.
Colorado Wich LLC and Colorado Wich Inc. sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Lead Case No.
18-13443) on April 24, 2018. The Court granted the joint
administration of the Debtors' cases on April 25, 2018.
In the petitions signed by Jeffrey A. Gordan, member, Colorado Wich
LLC disclosed $500,095 in assets and $2,150,648 in liabilities, and
Colorado Wich Inc. disclosed $92 in assets and $22,364 in
liabilities.
Judge Kimberley H. Tyson oversees the case.
The Debtors tapped Buechler & Garber, LLC, as their legal counsel.
CONTURA ENERGY: S&P Ups Issuer Credit Rating to B, Outlook Stable
-----------------------------------------------------------------
On Dec. 19, 2018, S&P Global Ratings raised its issuer credit
rating on Contura Energy Inc. to 'B' from 'B-'. S&P said, "We also
raised our issue-level ratings on the company's senior secured debt
to 'B+' from 'B'; the recovery rating on this debt remains '2',
indicating our expectation of substantial recovery (70%-90%;
rounded estimate: 70%) in the event of a default."
U.S.-based coal producer Contura Energy Inc. has completed its
merger with Alpha Natural Resources, and the combined company's
shares are listed on the New York Stock Exchange.
Concurrent with the merger, Contura also refinanced its capital
structure, which now principally consists of a new $550 million
term loan facility maturing in November 2025, and a $225 million
asset-backed revolving credit facility (ABL) maturing in April
2022. S&P anticipates the combined company will be the largest
producer of U.S. metallurgical coal, selling just under 13 million
tons out of about 27 million tons of coal overall in 2019.
The upgrade reflects successful completion of the combination
transaction, including refinancing the capital structure and
listing the company on the NYSE. It also indicates our expectations
of strong credit measures for the rating, evidenced by our forecast
of adjusted leverage around 2x going into 2020. With a reliable
source for met coal in Alpha's reserves, Contura is positioned to
take advantage of the robust met coal export market, while also
benefiting from the diversification provided by its substantial
thermal coal operations.
S&P said, "The stable outlook reflects our expectations of leverage
settling around 2x going into 2020. Stronger credit measures are
due in large part to recent reductions in asset retirement
obligations, partially offset by our expectations that met coal
prices will fall about 11% in 2019. As a result, leverage could
rise slightly over the next year. However, we still expect the
contribution from thermal coal operations and continued met coal
exports to sustain leverage around 2x going into 2020.
"We could lower the rating on Contura if leverage increased above
3x. This might be caused by a collapse in the met coal markets, or
loss of a major customer. We could also lower the rating if EBITDA
margins dropped below 15%, indicating a deterioration in
profitability. Although unlikely in the next 12 months, these
conditions could occur if adjusted EBITDA dropped below the $250
million to $300 million range.
"We could raise our rating on Contura if we expect leverage to
remain below 2x over the long term, particularly if the company
sustains EBITDA margins above 25%. In this scenario, we estimate
the company would consistently generate free operating cash flow
(FOCF, operating cash flow less capital spending) above $75
million."
COWLITZ TRIBAL: S&P Withdraws 'B+' Issuer Credit Rating
-------------------------------------------------------
On Dec. 18, 2018, S&P Global Ratings withdrew its 'B+' issuer
credit rating on Cowlitz Tribal Gaming Authority (CTGA) as CTGA
recently completed a refinancing transaction that repaid all
outstanding rated debt. At the same time, S&P withdrew its 'B+'
issue-level rating on CTGA's revolver and term loan, which were
refinanced.
CVENT INC: S&P Alters Outlook to Stable and Affirms 'B-' ICR
------------------------------------------------------------
S&P Global Ratings expects Cvent Inc.'s 2019 credit metrics to be
weaker than it forecasts due to lower than expected EBITDA
generation and increased debt.
S&P Global Ratings is thus revising the outlook on Cvent to stable
from positive and affirming its 'B-' issuer credit rating. S&P is
also affirming its 'B-' issue-level and '3' recovery ratings on the
company's first-lien term loan.
The outlook revision to stable from positive reflects S&P Global
Ratings' view that leverage will remain high, in the low-12x area
as of Sept. 30, 2018, and fall to the low-11x area in 2019. Cvent
did not sustain the EBITDA margins S&P forecasts when it revised
the outlook to positive on Nov. 2, 2017. This is mainly due to the
company's focus on top-line revenue growth at the expense of EBITDA
margins. Cvent increased expense in sales and marketing and on
research and development (R&D). This led the company to focus on
product innovation, international expansion, and new sales accounts
to drive this growth. For example, Cvent just opened an office in
Dubai to focus more on expanding to international markets. This
reinvestment in the business increased revenue for the last four
quarters. Meanwhile, EBITDA margins declined to leave leverage
high. Cvent also looked to expand inorganically, acquiring three
companies in 2018, one of which is financed with debt, increasing
adjusted leverage.
S&P said, "The stable outlook on Cvent reflects our view that
leverage will be high, in the low-12x area as of the quarter ended
Sept. 30, 2018. This is due to a mix of EBITDA margin compression
from large reinvestments into the business and newly financed debt
used for an acquisition. We expect the reinvestments to generate
strong top-line revenue growth in the low- to mid-teens percent
range for the next couple of years, which will compensate for some
decreased EBITDA. We also expect Cvent to generate positive FOCF
for 2018. As such, we anticipate the company's credit metrics will
remain stable and for leverage to decline to the low-11x area by
end of 2019.
"We could lower our rating if we come to view the capital structure
as unsustainable. This could occur if there is sustained negative
free cash flow or less than adequate liquidity. We believe this
would result from a slowdown in revenue growth due to cutbacks in
business spending during an unfavorable economic environment or
business disruptions caused by poorly executed integrations.
"While unlikely over the next 12 months, we could raise the rating
on Cvent if the company sustains adjusted leverage in the low-7x
area and FOCF to debt above 5%. This could be due to new revenues
from international expansion, new customer wins, a focus on
tightening operating expenses, or effectively cross-selling its
products."
DIAMONDBACK ENERGY: S&P Raises ICR to 'BB+' on Recent Acquisitions
------------------------------------------------------------------
S&P Global Ratings raised the issuer credit rating on Diamondback
Energy Inc. to 'BB+' from 'BB'. S&P also raised the issue-level
rating on the company's unsecured debt to 'BB+' from 'BB' with a
'3' recovery rating, reflecting its expectation of meaningful
(50%-70%; rounded estimate: 65% capped) recovery in the event of a
payment default.
S&P is removing all ratings from CreditWatch, where they were
placed with positive implications on August 15, 2018.
Midland, Texas-based oil and gas E&P company Diamondback Energy
Inc. has significantly increased its scale with Permian Basin
acquisitions, exhibiting production and reserve levels competitive
with certain investment-grade E&P credits. The company continues to
operate efficiently with low costs and a conservative financial
policy.
The upgrade predominantly reflects Diamondback Energy Inc.'s recent
all-stock acquisition of fellow Permian producer Energen Corp., as
well as smaller asset purchases from Ajax Resources, ExL Petroleum,
and EnergyQuest, which closed in October. On a pro forma basis, S&P
expects combined third-quarter 2018 production of over 220 thousand
barrels of oil equivalent per day (Mboe/d) and 700 million barrels
of oil equivalent (MMboe) of proved reserves to rival certain
investment-grade exploration and production (E&P) peers. The
company also benefits from a high liquids mix that we expect should
exceed 80% of production going forward. Pro forma drilling
inventory includes almost 400,000 net Permian acres in the core
Midland and Delaware sub-basins, with close to 7,200 net locations.
Additionally, the Energen transaction adds significant midstream
capacity to Diamondback's existing footprint of gathering and water
supply/disposal facilities, which will facilitate organic growth.
The combination with Energen also creates opportunities for
synergies on drilling and completions costs in the Midland basin,
general and administrative (G&A) reductions, interest savings, and
high grading via non-core asset sales.
S&P said, "The positive outlook reflects our expectations that
Diamondback will maintain a conservative financial policy while
continuing to develop its oil-rich Permian assets over the next two
years and working on integrating its recent acquisitions. We
forecast the company to maintain FFO to debt of at least 60% over
the same period.
"We could lower the rating if a period of lower commodity prices
leads to a decline in profitability or if management pursues a more
aggressive spending plan, resulting in weaker credit measures,
including FFO to debt below 60% on an ongoing basis.
"We may consider raising the the rating if the company successfully
integrates its recent acquisitions and improves its percentage of
proved developed reserves while sustaining a financial policy
consistent with investment-grade operators. The company would also
need to maintain at least adequate liquidity and moderate credit
measures while continuing to increase production to levels
comparable with higher-rated peers."
DIVINE DINING: Trustee Selling All Assets to North Texas for $50K
-----------------------------------------------------------------
Jason A. Rae, the Chapter 11 Trustee in the bankruptcy case of
Divine Dining, LLC, asks the U.S. Bankruptcy Court for the Northern
District of Texas to authorize the bidding procedures in connection
with the sale of substantially all assets to North Texas Taco Casa,
LLC in exchange for an amount as may be necessary to cure all
defaults under the restaurant lease and the franchise agreement,
plus $50,000, subject to overbid.
A hearing on the Motion is set for Jan. 7, 2019 at 1:30 p.m.
The Debtor's principal place of business is located at 1311 W.
Airport Freeway, Irving, Texas, subject to a nonresidential real
property lease dated Nov. 30, 2011 between the Debtor, as tenant,
and Adelphi Group, Ltd., a Texas limited partnership, as Landlord.
The Debtor is also a party to that certain Franchise Agreement
dated Oct. 4, 2011 under which the business is operated as a Taco
Casa franchisee for Mr. Roy Upshaw.
In addition to its rights under the Franchise Agreement and Lease,
the Trustee is in possession, and the estate owns, certain
inventory, furniture and equipment and related personal property
that is utilized in the operation of the business, as well as
general intangibles, including accounts receivable, customer lists,
and business goodwill ("Divine Dining Assets").
Prior to the filing of the Case, the Debtor, acting by and through
the Receiver, entered into the Asset Purchase Agreement, dated Aug.
27, 2018, with the Purchaser, which provided for the sale of the
Divine Dining Assets, and assignment of certain executory
contracts, through a sale in the Case. According to the Receiver,
she contacted the Franchisor, the prior owners of the Debtor, the
Landlord and numerous other franchisees of Taco Casa restaurants in
an attempt to identify potential purchasers of the Divine Dining
Assets who would have the financial wherewithal and realistically
qualify as a franchisee. In connection with those efforts, the
Purchaser was the only party at that point willing to make an offer
and negotiate with the Receiver.
Subsequent to his appointment, the Trustee negotiated with the
Purchaser to secure the proposed purchase of the Divine Dining
Assets on terms providing for more clarity on the sale and a more
favorable outcome for all parties and memorialized such terms in an
Amendment to the Purchase Agreement dated Nov. 1, 2018. The
Trustee believes, in his reasonable business judgment that an
immediate sale to the Purchaser pursuant to the Purchase Agreement,
or to a qualified bidder on more favorable terms, is in the best
interest of the Estate and its creditors.
The Trustee is initially requesting approval of procedures to
govern (A) an expeditious and efficient bidding, auction and sale
process for the Divine Dining Assets, and (B) the assumption and
assignment of the Franchise Agreement and Lease and any other
relexecutory contracts and unexpired leases designated as part of
the sale to the successful bidder and on terms approved by the
Court. He believes that the procedures proposed will maximize the
value of the Divine Dining Assets and ensure an effective and
efficient process that will culminate in the sale of all, or
substantially all, of the Divine Dining Assets and the assumption
and assignment of the Restaurant Contracts.
At the closing of the Sale, all net sale proceeds will be deposited
into an account maintained by the Trustee for the benefit of the
estate, and all valid prepetition liens and/or security interests
against the Divine Dining Assets, if any, will attach to such sale
proceeds in the same priority as they attached against the Divine
Dining Assets with the exception of any valid and enforceable liens
of the Landlord against personal property fixtures and secured debt
assumed by the Purchaser and identified as part of the Sale. The
sale proceeds will only be distributed upon further order of the
Court except for funds required to pay the normal and necessary
costs incurred by the Trustee in the operation of any remaining
assets for the estate and administration of the Case.
For purposes of the initial hearing, the Trustee asks that the
Court enters an Order approving (a) the form and manner of the Sale
Notice, which includes the respective dates, times and places for
an auction of the Divine Dining Assets and the Sale Hearing; and
(b) the Sale Procedures.
Within three business days after the Court enters an Order
approving the Sale Procedures under the Motion, the Trustee will
serve the Sale Notice upon all Sale Notice Parties. Pursuant to
the Purchase Agreement, the Trustee is proposing to assume and
assign the Lease and Franchise Agreement to the Purchaser as part
of the Sale. The Lease and Franchise Agreement, along with the
maximum Cure Amounts required to be paid by any purchaser are set
forth on Exhibit B. Objections, if any, to the Sale and/or the
proposed assumption and assignment of the Restaurant Contracts,
must be filed not later than the objection deadline. The Trustee
asks authorization to supplement the list of contracts and cure
amounts on Exhibit B prior to the Sale Hearing if any additional
contract is designated by a proposed purchaser for assumption and
assignment as a condition to the Sale.
The Trustee has received an offer from Purchaser that it wishes to
accept as a "stalking horse" bid and proposes to designate the
Purchaser as the "Stalking Horse Bidder." The Purchaser has
demonstrated its commitment to proceed with the Sale by submitting
a $25,000 deposit and executing the Purchase Agreement on terms
acceptable to the Trustee. Additionally, as an existing approved
franchisee for other Taco Casa locations, Purchaser has
demonstrated its ability to complete and close the sale on the
terms set forth in the Purchase Agreement.
The Trustee believes that good cause exists to expose the Divine
Dining Assets to sale at auction to test the market value of the
consideration under the Purchase Agreement. An auction conducted
substantially in accordance with the Sale Procedures will enable
the Trustee to obtain the highest and best offer for the Divine
Dining Assets, thereby maximizing their value for the benefit of
the bankruptcy estate. As a result, the Trustee asks authority to
pay to such Stalking Horse Bidder the amount of $25,000 if the
conditions set forth in the Sales Procedures are satisfied. At the
final hearing on the Sale Motion, the Trustee will present the
highest and best offer to the Court for approval and asks that a
final order be entered approving the Sale and the assumption and
assignment of the Restaurant Contracts.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: Jan. 22, 2019 at 5:00 p.m.
b. Initial Bid: $30,000 more than the amount of the Stalking
Horse Bid
c. Deposit: $25,000
d. Auction: In the event the Trustee receives one or more
timely and conforming Qualified Bids by the Bid Deadline and, in
the business judgment of the Trustee, are superior to the Stalking
Horse Bid, the Trustee will conduct an Auction for the sale of the
Divine Dining Assets at the offices of Lain, Faulkner & Co., P.C.,
400 N. St. Paul Street, Suite 600, Dallas, Texas, or at such other
location as may be timely disclosed by the Trustee to the Qualified
Bidders. The Auction will commence on Jan. 28, 2019 at 10:00 a.m.
e. Bid Increments: $10,000
f. Sale Hearing: TBD
g. Closing: Feb. 25, 2019
h. Sale Objection Deadline: Feb. 5, 2019
i. Cure Claim Objection: Jan. 17, 2019
A copy of the Stalking Horse APA and the Bidding Procedures
attached to the Motion is available for free at:
http://bankrupt.com/misc/Divine_Dining_46_Sales.pdf
The Purchaser can be reached at:
Sami N. Ebrahim
FOREST CENTRAL II
11551 Forest Central Dr., Suite 230
Dallas, TX 75243
Telephone: (214) 319-9100
Facsimile: (214) 319-9102
About Divine Dining
Divine Dining, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Tex. Case No. 18-32805) on Aug. 27,
2018. At the time of the filing, the Debtor estimated assets of
less than $1 million and liabilities of less than $1 million.
Judge Stacey G. Jernigan presides over the case. The Debtor tapped
Richard G. Grant, Esq., at Culhane Meadows, PLLC, as its legal
counsel.
Jason A. Rae was appointed as Chapter 11 trustee for the Debtor.
The Trustee tapped Lain Faulkner & Co., PC, as accountant, and
Marshall Law as attorney.
ENERGEN CORP: S&P Raises ICR to 'BB+' Amid Diamond Energy Deal
--------------------------------------------------------------
Diamondback Energy Inc. completed its acquisition of oil and gas
exploration and production company Energen Corp. in a transaction
valued at $9.2 billion, including consideration for Energen's $830
million of net debt.
S&P said, "We are raising our issuer credit rating on Energen to
'BB+' from 'BB', and removing it from CreditWatch with positive
implications. The outlook is positive.
"At the same time, we are raising our ratings on Energen's senior
unsecured notes to 'BB+' from 'BB' and removing them from
CreditWatch with positive implications. The recovery rating on the
unsecured debt is unchanged at '3', indicating our expectation of
meaningful (50%-70%; rounded estimate: 65%) recovery in the event
of a payment default.
"Subsequent to this, we are withdrawing our issuer credit rating on
Energen at the company's request, as well as our 'BBB-' issue-level
rating on the company's secured credit facility, which has been
fully repaid and terminated."
Energen's 'BB+' rated senior unsecured notes will remain at the
Energen entity, a wholly owned subsidiary of Diamondback, and will
be guaranteed solely by Energen.
The rating actions follow the closing of Diamondback Energy's
acquisition of Energen Corp. S&P said, "We raised our issuer credit
rating on Energen to 'BB+' with a positive outlook to equalize it
with that of Diamondback, as we now consider Energen to be a core
entity of the company. We then withdrew our issuer credit rating on
Energen, as well as our issue-level rating on the company's secured
credit facility, at the issuer's request."
FABRIC FANATICS: Third Interim Cash Collateral Use Okayed
---------------------------------------------------------
The Hon. Brenda T. Rhoades of the U.S. Bankruptcy Court for the
Eastern District of Texas has entered a third agreed order
authorizing Fabric Fanatics, Inc.'s interim use of cash collateral,
if any, of LiftFund.
The final hearing to consider the entry of a Final Order
authorizing and approving the use of cash collateral is scheduled
for Dec. 18, 2018, at 9:30 a.m.
The Debtor is permitted to use cash collateral, in accord with the
Third Interim Order and the Budget. That Debtor may exceed any
line item in the Budget by up to 10%. The Budget provides total
monthly expense in the aggregate sum of $14,340. The Budget may be
updated and modified through the date of the Final Hearing by: (a)
consensual agreement of Debtor and the Secured Lender; or (b) by
further order of the Court.
LiftFund asserts that it is secured by liens on and security
interests in substantially all Debtor's property and the proceeds
thereof.
The Court grants LiftFund with replacement liens on the Debtor's
property to the same extent as existed prepetition, whether such
property was acquired before or after the Petition Date. Such
Replacement Liens are exclusive of any avoidance actions available
to the Debtor's bankruptcy estate and the proceeds thereof.
Further, such Replacement Liens will be equal to the aggregate
diminution in value of the Prepetition Collateral that occurs from
and after the Petition Date. The Replacement Liens will be of the
same priority, validity and enforceability as the liens of LiftFund
on the Prepetition Collateral.
In addition, the Debtor will pay LiftFund a monthly payment of
$870, on the ninth day of each month thereafter until further order
of the Court. The Debtor will also maintain, insure and otherwise
preserve and protect the Prepetition Collateral and the collateral
upon which LiftFund is granted Replacement Liens, including, but
not limited to, maintaining appropriate insurance on the
Collateral, with the Secured Lender listed as loss payee under all
such insurance policies.
A full-text copy of the Third Agreed Order is available at
http://bankrupt.com/misc/txeb18-42287-24.pdf
About Fabric Fanatics
Fabric Fanatics, Inc., a Texas corporation, currently operates from
Plano, Texas. It was started in 2002 and sells only 100% cotton
Batik fabrics to the retail consumer via storefront, internet, and
quilt shows
Fabric Fanatics filed a Chapter 11 petition (Bankr. E.D. Tex. Case
No. 18-42287) on Oct. 10, 2018. In the petition signed by Lisa
Anderson, president, the Debtor estimated $100,000 to $500,000 in
assets and $500,000 to $1 million in estimated liabilities. The
Debtor is represented by Robert T. DeMarco at DeMarco Mitchell,
PLLC.
FRANK THEATRES: Case Summary & 30 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: Frank Theatres Bayonne/South Cove, LLC
191 Lefante Way
Bayonne, NJ 07002
Business Description: The Frank Entertainment Group --
http://franktheatres.com-- has owned,
operated, developed, and managed over 150
entertainment venues including
nickelodeons, motion picture theatres,
arcades, restaurants, nightclubs, bowling
centers, game centers, and family
entertainment centers. The Debtors
operate pure play movie theaters,
combination movie theater/family
entertainment complexes, and pure play
family entertainment complexes in six
east coast states--New Jersey (including
theaters located in Bayonne and Rio
Grande), Florida, North Carolina, South
Carolina, Pennsylvania, and Virginia --
under the brand names Frank Theatres,
CineBowl & Grille, and Revolutions. The
Debtors employ approximately 694
people. Frank Entertainment Group, LLC
is the ultimate parent of all of the
other Debtors, including Frank
Management, LLC, the main
operating/management company. The
Debtors are headquartered in Jupiter,
Florida.
Chapter 11 Petition Date: December 19, 2018
Twenty-four affiliates that filed voluntary petitions seeking
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Frank Theatres Bayonne/South Cove, LLC (Lead Case) 18-34808
Frank Entertainment Group, LLC 18-34812
Frank Theatres Rio, LLC 18-34816
Frank Management LLC 18-34818
Frank Theatres, LLC 18-34820
Frank All Star Theatres, LLC 18-34822
Frank Theatres Blacksburg LLC 18-34823
Frank Theatres Delray, LLC 18-34824
Frank Theatres Kingsport, LLC 18-34825
Frank Theatres Montgomeryville, LLC 18-34826
Frank Theatres Parkside Town Commons LLC 18-34828
Frank Theatres Towne, LLC 18-34830
Frank Theatres York, LLC 18-34832
Frank Theatres Mt. Airy, LLC 18-34833
Frank Theatres Southern Pines, LLC 18-34837
Frank Theatres Sanford, LLC 18-34839
Frank Theatres Shallottee, LLC 18-34840
Revolutions at City Place LLC 18-34841
Revolutions at Saucon Valley LLC 18-34844
Frank Entertainment Rock Hill LLC 18-34845
Frank Entertainment PSL, LLC 18-34846
Frank Hospitality Saucon Valley LLC 18-34847
Frank Hospitality York LLC 18-34848
Galleria Cinema, LLC 18-34849
Court: United States Bankruptcy Court
District of New Jersey (Newark)
Judge: Hon. Stacey L. Meisel
Debtors' Counsel: Kenneth A. Rosen, Esq.
Joseph J. DiPasquale, Esq.
Eric S. Chafetz, Esq.
Michael Papandrea, Esq.
LOWENSTEIN SANDLER LLP
One Lowenstein Drive
Roseland, New Jersey 07068
Tel: (973) 597-2500
Fax: 597-2400
Email: krosen@lowenstein.com
jdipasquale@lowenstein.com
echafetz@lowenstein.com
mpapandrea@lowenstein.com
Debtors'
Financial
Advisor: MOSS ADAMS LLP
Debtors'
Consultant or
Advisor: PARAGON ENTERTAINMENT HOLDINGS, LLC
Debtors'
Claims,
Noticing &
Balloting
Agent: PRIME CLERK LLC
https://cases.primeclerk.com/frankentertainment
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Christopher Lang, chief restructuring
officer.
A full-text copy of Frank Theatres Bayonne/South Cove's petition is
available for free at:
http://bankrupt.com/misc/njb18-34808.pdf
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Kite Realty Group, LP Landlord $801,765
Attn: Dave Buell
30 S. Meridian Street
Suite 1100
Indianapolis, IN 46204
Tel: 317-713-5647
Moss Adams LLP Professional $288,463
Attn: Christopher Lang Fees
8750 N Central Expwy
Dallas, TX 75231
Tel: 469-453-7199
Paragon Management, LLC Professional $284,008
Attn: Mike Whalen Fees
2461 Hillsboro Blvd.
Deerfield Beach, FL 33442
Tel: 954-320-7112 Ext.2525
JTL Rock Hill, LLC Landlord $157,200
Attn: Anita Clark
8201 Preston Road
Suite 700
Dallas, TX 75225
Tel: 803-324-1711
IMAX Corporation Trade Debt $150,981
2525 Speakman Dr.
Mississauga, Ontario, Canada,
L5K 1B1
Tel: 905-403-6500
Staples Credit Plan Trade Debt $115,590
500 Staples Drive
Framingham, MA 01702
Tel: 800-767-1291
First Run LLC Trade Debt $107,430
350 N. LaSalle Drive
Suite 1100
Chicago, IL 60654
Frank Investments, Inc. Trade Debt $96,375
1003 W. Indiantown Road
Suite 210
Jupiter, FL 33458
Roadside Attractions Trade Debt $90,912
Attn: Eddie Dotson
7920 Sunset Blvd.
Suite 402
Los Angeles, CA 90046
Tel: 323.882.8490
Deluxe Echostar LLC Trade Debt $89,511
2400 W. Empire Avenue
Suite 200
Burbank, CA 91504
Tel: 800-328-0304
Sysco of South East Florida Trade Debt $88,631
1999 Martin Luther King Blvd.
Riviera Beach, FL 33404
Telephone: 561- 881-8031
Bonita Marie International Trade Debt $66,976
1960 Rutgers University Blvd.
Lakewood, NJ 08701
Tel: 732-363-0212
Entertainment Supply & Trade Debt $65,621
Technologies, LLC
3820 Northdale Blvd. # 308B
Tampa, FL 33624
Tel: 813-960-1646
Entertainment Studios Motion Trade Debt $64,408
Pictures, LLC
Attn: Griselda Gonzales
1925 Century Park East
10th Floor, Los Angeles, CA 90067
Tel: 310-277.3500
Blacksburg APF Partners LLC Trade Debt $62,646
226 Wexler Street, Suite 200
Kingsport, TN 37600
Dorsey Whitney LLP Professional $57,470
300 Crescent Court Fees
Suite 400
Dallas, TX 75201
Cinema Scene Marketing Trade Debt $53,671
9200 Indian Creek Pkwy # 200
Overland Park, KS 66210
Tel: 913-825-0574
Vistar Corporation Trade Debt $51,366
1700 Avenue B
Kissimmee, FL 34758
S V Media Works, LLC Trade Debt $51,163
40875 Hayrake Place
Aldie, VA 20105
20th Century Fox Film Corp. Trade Debt $48,960
5799 Collection Center Drive
Chicago, IL 60693
The Weinstein Company, LLC Trade Debt $48,074
345 Hudson Street, 13th Floor
New York, NY 10014
Saucon Valley Square Condo Trade Debt $41,949
Association
1208 Route 34, Suite 19
Aberdeen, NJ 07747
The ICEE Company Trade Debt $40,392
1205 S. DuPont Avenue
Ontario, CA 91761-7817
Tel: 818-727-0369
A24 Films LLC Trade Debt $40,392
31 W. 27th St., 11th floor
New York, NY 10001
Card Services Trade Debt $36,290
Express Mail Remittance
Processing
20500 Belshaw Avenue
Carson, CA 90746
Direct TV Trade Debt $35,049
1025 Lenox Park Blvd. Atlanta,
GA 30319
Water Tower Square Trade Debt $33,184
Associates
350 Sentry Parkway
Building 630, Suite 300
Blue Bell, PA 19422
Visa Entertainment Solutions Trade Debt $30,637
US Ltd.6300 Wilshire Blvd.
Suite 940
Los Angeles, CA 90048
Sidley Austin LLP Professional $30,404
2201 McKinney Avenue Fees
#2000
Dallas, TX 75201
Betson Enterprises Trade Debt $28,187
303 Paterson Plank Road
Carlstadt, NJ 07072-2307
GLANSAOL HOLDINGS: Case Summary & 30 Top Unsecured Creditors
------------------------------------------------------------
Lead Debtor: Glansaol Holdings Inc.
575 Lexington Avenue
New York, NY 10022
Business Description: Glansaol Holdings and its subsidiaries are
an independent prestige beauty and
personal care companies. With a portfolio
of
three highly regarded brands, the Debtors
reach their customers through a variety of
channels and offer a full spectrum of
products, from makeup to skin care.
Headquartered in New York City, the Debtors'
primary business operations are comprised of
sales of beauty products to wholesale
customers and broadcast shopping networks,
who
in turn sell the Debtors' merchandise to end
consumers at the retail level. The Debtors
also sell their products directly to
consumers
through the Debtors' online store and their
nail salons in Seattle, Washington. Julep
products are also sold through QVC broadcast
shopping network and the wholesale retailer
Ulta Salon, Cosmetics & Fragrance, Inc.
The Debtors were formed in October 2015 to
serve as a platform company to acquire,
integrate, and cultivate a portfolio of
prestige beauty brands diversified across
segments, channels and geographies.
Chapter 11 Petition Date: December 19, 2018
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Eight affiliates simultaneously filed voluntary petitions seeking
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Glansaol Holdings Inc. (Lead Case) 18-14102
Glansaol LLC 18-14103
Glansaol Management LLC 18-14104
Julep Beauty, Inc. 18-14105
Laura Geller Holdings, LLC 18-14106
Laura Geller Beauty, LLC 18-14107
Laura Geller Brands, LLC 18-14108
Clark's Botanicals, Inc. 18-14109
Debtors' Counsel: Brian S. Lennon, Esq.
Daniel I. Forman, Esq.
Andrew S. Mordkoff, Esq.
WILLKIE FARR & GALLAGHER LLP
787 Seventh Avenue
New York, New York 10019
Tel: (212) 728-8000
Fax: (212) 728-8111
Emails: Brian S. Lennon
dforman@willkie.com
amordkoff@willkie.com
Debtors'
Financial
Advisor: EMERALD CAPITAL ADVISORS
70 East 55th Street, 17th Floor
New York, New York 10022
Debtors'
Claims &
Noticing
Agent: OMNI MANAGEMENT GROUP, INC
1120 Avenue of the Americas, 4th Floor
New York, New York 10036
https://is.gd/VRDrMO
Estimated Assets*: $10 million to $50 million
Estimated Liabilities*: $10 million to $50 million
* Information provided on a consolidated basis, and based on
financial statements as of Oct. 31, 2018.
The petitions were signed by Nancy Bernardini, chief executive
officer.
A full-text copy of Glansaol Holdings' petition is available at no
charge at:
http://bankrupt.com/misc/nysb18-14102.pdf
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
B Kolormakeup & Skincare Srl Trade Debt $575,648
Via Canonica, 79/A
Treviglio, BG 24047
Italy
Attn: General Counsel
Tel: +39 0363-590011
Fax: +390363590212
Email: info@bkolormakeup.com
Chromavis Spa Trade Debt $545,419
Via Martiri Delle Foibe, 77
Vaiano Cremasco, CR 26010
Italy
Attn: General Counsel
Tel: 39 0373 279 311
Fax: 39 0373 279 342
Email: info@chromavis.com
Advanced Distribution Systems Trade Debt $392,929
275 Oak Tree Rd
Palisades, NY 10964
Attn: General Counsel
Tel: 201-767-7350
Fax: 201-767-4011
Mana Products Inc Trade Debt $348,497
Elm Global Logistics
50 Emjay Blvd
Brentwood, NY 11717
Attn: General Counsel
Tel: 718-361-2550
Fax: 718-786-3204
MYC Packaging Innovation CO., Ltd. Trade Debt $336,225
Room C, 12th Floor, Information
Mansion
No 66 Huanfu Road
Loufeng Town, Suzhou
Jiangsu, China
Attn: General Counsel
Tel: 517-410-0928
Email: cherry@myc-innovation.com
Gotha Cosmetics USA, Inc. Trade Debt $303,213
560 Broadway, Suite 304
New York, NY 11012
Attn: Francesca Petronzi
Email: francesca.petronzi@gothacosmetics.com
Compax Trade Debt $300,979
431 Neil Armstrong Rd
Salt Lake City, UT 84116-2890
Attn: J. Mansur
Tel: 949-7166776
Email: jmansur@compaxpackaging.com
HM Revenue and Customs Tax Liability $300,000
VAT Central Unit BX5 5AT
United Kingdom
Integrated Packaging Trade Debt $297,942
45 Carey Avenue
Butler, NJ 07405
Tel: 973-839-0500
Fax: 973-839-2990
Email: stephanie@integratedpackaging.net
QVC, Inc Royalties $284,747
1200 Wilson Drive
Mail Code 151
West Chester, PA 19380
Attn: Lindsay Eidson
Tel: 888-345-5788
Email: lindsay.b.eidson@qvc.com
Cosmax USA, Inc. Trade Debt $272,267
30701 Carter Street
Solon, OH 44139
Attn: Raleigh Pierson
Tel: 440-600-5710
Email: Raleigh.Pierson@cosmaxusa.com
Dorsey & Whitney LLP Legal Fees $261,275
P.O. Box 1680
Minneapolis, MN 55480
Attn: General Counsel
Email: chin.pearl@dorsey.com
Arkay Packaging Corp. Trade Debt $259,308
100 Marcus Blvd, Suite 2
Hauppauge, NY 11788
Attn: Tom Brown
Tel: 631-297-3347
Email: tom.brown@arkay.com
Intercos America Inc Trade Debt $258,223
Intercos Us West Nyack Facility
11 Centerock Road
West Nyack, NY 10994
Attn: General Counsel
Tel: 212-319-0700
Facebook. Inc. Marketing $255,613
15161 Collections Center Drive
Chicago, IL 60693
Attn: General Counsel
Tel: 650-543-4800
Fax: 650-543-5325
Email: AR@fb.com
Wormser Corporation Trade Debt $243,272
150 Coolidge Avenue
Englewood, NJ 07631
Tel: 201-627-1000
Fax: 201-627-1001
Email: grace@wormsercorp.com
Schwan Cosmetics Germany Trade Debt $240,837
GmbH & Co. Kg
Schwanweg 1
Heraldberg, BV 90562
Germany
Attn: Yvonne Alt
Email: Yvonne.Alt@schwancosmetics.com
World Wide Packaging Inc Trade Debt $219,379
No.333 Sec.2 Fanhua Rd.
Fu Shi, Changhua 50660
Taiwan
Attn: M. Robbins
Tel: 973-805-6500
Fax: 973-805-6510
Email: mrobbins@wwpinc.com
Ulta, Inc. Customer $211,867
Attn: C. Gardner Programs
1000 Remington Boulevard, Suite 120
Bolingbrook, IL 60440
Tel: 630-410-5074
Email: CGardner@ulta.com
Regi S.r.l. Trade Debt $173,510
Via Enrico Mattei. 6-10-14 Crema
Bagnolo Cremasco, CR 26010
Italy
Attn: C. Gottardi
Tel: +39 0373 31861
Fax: +39 0373 31886
Email: c.gottardi@regi.it
Intercos S.P.A. Trade Debt $166,083
Via Marconi 84
Agrate Brianza, MB
Italy
Attn: General Counsel
Tel: +39 (0) 3965521
Email: info@intercos.it
Colorado Quality Products Trade Debt $157,717
4003 S. Clay Street
Englewood, CO 80110
Attn: General Counsel
Tel: 303-708-0536
Email: info@coloradoqualityproducts.com
Hwa Sung Cosmetics Trade Debt $157,575
161-5 Dadand-Dong
Wonmi-Ku Buchen-Si
Kyungki-Do, 420-130
Korea
Email: soo@hwasungcos.com
Baralan USA, Inc. Trade Debt $144,758
120-19 89Th Ave.
Richmond Hill, NY 11418
Attn: Luisa Kamelhar
Tel: 718-849-1600 ext 327
Email: luisa.kamelhar@baralanusa.com
PKG Group, LLC Trade Debt $140,843
400 Apgar Dr, Unit L
Somerset, NJ 08873
Attn: General Counsel
Tel: 310-205-9038
Fax: 310-205-9147
Sunrise Technologies Professional Fees $135,287
525 Vine Street, Suite 210
Winston-Salem, NC 27101
Attn: General Counsel
Tel: 336-722-6741
Email: info@sunrise.co
PricewaterhouseCoopers LLP Professional Fees $122,387
4040 W Boy Scout Boulevard
Tampa, FL 33607
Attn: General Counsel
Tel: 813-348-7000
HCT Packaging, Inc. Trade Debt $113,714
721 Route 202/206 Suite 300
Bridgewater, NJ 08846
Attn: General Counsel
Tel: 212-586-0303
Email: edepays@hctusa.com
American Express Credit Card $113,508
P.O. Box 981535
El Paso, TX 79998-1535
Tel: 800-528-5200 Provider
Fax: 800-695-9090
Crystal Claire Cosmetics Inc Trade Debt $109,602
165 Milner Avenue
Scarborough, ON M1S 4G7
Canada
Tel: 416-421-1882
Email: rhondab@crystalclaire.com
GLANSAOL LLC: Files for Chapter 11 to Sell to AS Beauty
-------------------------------------------------------
On Dec. 19, 2018, in the Southern District of New York, Glansaol
LLC and certain of its affiliates voluntarily filed bankruptcy
petitions under chapter 11 of the U.S. Bankruptcy Code and
simultaneously filed a motion seeking Court authority to sell
substantially all of its assets to AS Beauty LLC ("AS Beauty") as a
going concern. The sale to AS Beauty LLC is subject to higher or
otherwise better offers, and a court-supervised marketing process.
The sale, which is supported by the Company's existing lenders, is
designed to preserve the strength of the Company's core businesses
for the benefit of the Company's economic stakeholders. The
Bankruptcy Court is expected to consider whether to approve the
sale procedures in early 2019.
"The Board and management team have thoroughly assessed all of our
strategic options and are confident that the proposed sale process
represents the best path forward for the Company," said Nancy
Bernardini, the Company's chief executive officer. "We are pleased
to have entered into an asset sale agreement with AS Beauty and are
excited for the Company's future."
The Company is being advised by Emerald Capital Advisors as its
financial advisor and Willkie Farr & Gallagher LLP as legal
counsel. AS Beauty is being represented by Sill Cummis & Gross
P.C., as legal counsel.
About Glansaol
Glansaol LLC is a world-class prestige beauty and personal care
company with an integrated portfolio of premium, complementary
brands that include Laura Geller, Julep and Clark's Botanicals.
Glansaol works with individual brands to retain their brand
uniqueness while collaborating together on innovation, research and
ideas across brands. Through this approach, Glansaol is dedicated
to providing consumers with high quality, innovative products.
Glansaol means "pure life" in the Irish language and is pronounced
Glan-Sale.
GOODYEAR TIRE: Fitch Afirms BB LT Issuer Default Rating
-------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings of
The Goodyear Tire & Rubber Company (GT) and its Goodyear Dunlop
Tires Europe B.V. subsidiary at 'BB'. In addition, Fitch has
affirmed the 'BB+'/'RR1' ratings on GT's secured revolving credit
facility and second-lien term loan and on GDTE's secured revolving
credit facility. Fitch has affirmed GT's senior unsecured notes
rating at 'BB'/'RR4' and GDTE's senior unsecured notes rating at
'BB'/'RR2'.
GT's ratings apply to a $2 billion asset-based revolving credit
facility, a $400 million second-lien term loan and $3 billion in
senior unsecured notes. GDTE's ratings apply to a EUR550 million
secured revolving credit facility and EUR250 million in senior
unsecured notes.
The Rating Outlooks for GT and GDTE are Stable.
KEY RATING DRIVERS
GT's ratings reflect the tire manufacturer's relatively strong
margin performance, high brand recognition, globally diversified
manufacturing footprint and strong competitive position in the
higher-margin 17-inch-and-above tire segment. These positive
factors are set against a backdrop of recently elevated financial
leverage, heavy industry competition, highly seasonal cash flow
variability and high sensitivity to raw material prices. Following
five years of declining revenue due to a combination of product
rationalizations, lower commodity prices, the deconsolidation of
its Venezuelan operations and the dissolution of its alliance with
Sumitomo Rubber Industries, Ltd., revenue turned a corner and rose
modestly in 2017 and continued to rise through the first three
quarters of 2018. GT's tire volumes have also turned positive over
the past several quarters, following several years of volume
declines.
Although the recent revenue improvement is a positive sign, it has
been accompanied over the past year by much higher raw material
costs and challenging competitive conditions, which have resulted
in lower margins and earnings. Over the intermediate term, Fitch
expects stronger industry pricing, higher replacement tire demand
in emerging markets and increased high-value tire production from
GT's new plant in Mexico will drive improved earnings and FCF,
which will provide the company with opportunities for further
credit profile improvement. However, the company's performance is
likely to remain challenged over the next several quarters,
resulting in weaker credit protection metrics than Fitch had
previously expected. The Stable Outlook is based on Fitch's
expectation that over the intermediate term, GT's credit metrics
will strengthen back toward levels seen a couple years ago.
A steep increase in commodity prices that began in 2017 and
persisted through much of 2018 increased GT's overall costs, while
competitive market dynamics challenged the company's ability to
fully pass through the higher costs to customers. Although the
company initially saw a drop in volumes when it first tried to
increase prices in mid-2017, it appears to have found a combination
of pricing and product mix that has resulted in improved volumes,
but margins remain under pressure. GT estimates that its raw
material costs will increase by $270 million (or 6%) in 2018
following a $725 million (or 19%) increase in raw material costs
for the full year of 2017. On a positive note, persistently
elevated commodity costs now appear to be driving the global
industry to raise prices at a somewhat faster rate, which should
bode well for GT's ability to grow margins over the intermediate
term.
FCF
Over the past several years, GT has allocated a substantial portion
of its post-dividend FCF toward share repurchases, including $395
million in the 12 months ended Sept. 30, 2018. However, Fitch
expects that going forward, share repurchases will be significantly
lower as the company redoubles its focus on achieving credit
metrics more consistent with investment-grade ratings. As such,
Fitch expects the company to target more of its post-dividend FCF
toward debt-reduction opportunities over the intermediate term,
with a likely focus on higher-cost borrowings that can be repaid
without penalty.
Fitch expects GT to produce positive annual post-dividend FCF over
the intermediate term, with FCF margins generally in the low-single
digit range. Fitch expects capital spending as a percentage of
revenue to run at roughly 5.5% over the intermediate term based on
maintenance capital spending needs, along with some growth and
cost-savings projects. Post-dividend FCF in the LTM ended Sept. 30,
2018 was $268 million, equating to a 1.7% FCF margin.
Fitch's FCF calculation is adjusted for the effect of
period-to-period changes in off-balance sheet factored receivables,
which Fitch treats as financing cash flows. GT's FCF still remains
quite seasonal, with most of the company's cash generation
typically occurring in the fourth quarter, but the magnitude of the
intra-year positive and negative seasonal working capital swings
has moderated over the past several years. Nonetheless, negative
working capital at certain points during a typical year will likely
result in temporary increases in leverage as the company borrows
from its various global credit facilities to meet short-term cash
liquidity needs.
DEBT AND LEVERAGE
Fitch expects GT's gross EBITDA leverage, including off-balance
sheet factoring, to decline to the mid-2x range over the next
couple of years as the company focuses on strengthening its credit
profile and as EBITDA grows on slightly higher business levels and
continued solid profitability. Fitch expects funds from operations
(FFO) adjusted leverage to decline to around 4x over the same
period. Both leverage forecasts are somewhat higher than Fitch's
previous expectations, largely due to a higher reset in Fitch's
expectation for raw material costs, weaker than expected conditions
in the tire market in China, and industry competitive dynamics.
GT's debt levels have also been running higher than previously
expected as the company slowed its debt-reduction activities as FCF
levels declined.
As of Sept. 30, 2018, GT's actual EBITDA leverage, as calculated by
Fitch, was 3.3x and FFO adjusted leverage was 5.3x. Debt (including
off-balance sheet factoring) totaled $7.1 billion at Sept. 30,
2018, up from $6.9 billion at Sept. 30, 2017. Included in GT's debt
at Sept. 30, 2018 was a total of $685 million in borrowings on its
primary U.S. and European revolvers, although Fitch expects the
company will repay a substantial portion of those borrowings by
year-end 2018. As such, Fitch expects EBITDA leverage will decline
to around 3.0x and FFO adjusted leverage will decline toward 5.0x
by year-end 2018. FFO was depressed in the LTM ended Sept. 30,
2018, in part due to rationalization payments and other
non-recurring cash costs that resulted in elevated FFO adjusted
leverage.
RATINGS NOTCHING
The IDRs of GT and GDTE are equalized, given the strong operating
and legal ties between the two entities, including cross-default
provisions to GT's debt in certain of GDTE's debt agreements,
downstream guarantees from GT to GDTE, and certain covenants in
GDTE's debt agreements that are based on GT's consolidated figures.
There are also strong operational ties, as GDTE's operations are
fully integrated with those of GT.
The ratings of 'BB+'/'RR1' on GT's and GDTE's secured credit
facilities, including the second-lien term loan, reflect their
substantial collateral coverage and outstanding recovery prospects
in a distressed scenario. The one-notch uplift from the IDRs of GT
and GDTE reflects Fitch's notching criteria for issuers with IDRs
in the 'BB' range. On the other hand, the rating of 'BB'/'RR4' on
GT's senior unsecured notes reflects Fitch's expectation that
recoveries would be average in a distressed scenario, consistent
with most senior unsecured obligations of issuers with an IDR in
the 'BB' range.
GDTE's EUR250 million 3.75% senior unsecured notes due 2023 have a
Recovery Rating of 'RR2', reflecting the notes' structural
seniority to GT's senior unsecured debt. GDTE's notes are
guaranteed on a senior unsecured basis by GT and the subsidiaries
that also guarantee GT's secured revolver and second-lien term
loan. Although GT's senior unsecured notes are also guaranteed by
the subsidiaries that guarantee its revolver and second-lien term
loan, they are not guaranteed by GDTE. The recovery prospects of
GDTE's notes are further strengthened relative to those at GT by
the lower level of secured debt at GDTE. However, the rating of
'BB' on GDTE's senior unsecured notes is the same as the rating on
GT's senior unsecured notes, reflecting Fitch's notching criteria
for issuers with an IDR in the 'BB' range. GDTE's credit facility
and its senior unsecured notes are subject to cross-default
provisions relating to GT's material indebtedness.
DERIVATION SUMMARY
GT has a relatively strong competitive position as the
third-largest global tire manufacturer, with a highly recognized
brand name and a focus on the higher-margin 17-inch-and-above tire
category. However, the focus on these higher-margin tires led to a
decline in volumes and revenue for several years in the mature
North American and Western European markets. The company's
geographical diversification is increasing as a higher vehicle
sales and rising incomes in emerging markets lead to increased
demand for these higher-margin tires, particularly in the Asia
Pacific region.
GT's margins are roughly consistent with the other large
Fitch-rated rated tire manufacturers, Compagnie Generale des
Etablissements Michelin (A-/Stable) and Continental AG
(BBB+/Stable), but GT's leverage is considerably higher, as the
other two companies both maintain EBITDA leverage below 1x. GT's
leverage is more consistent with vehicle suppliers in the 'BB'
category, such as Meritor, Inc. (BB-/Stable), Delphi Technologies
PLC (BB/Stable) or Tenneco Inc. (BB-/Stable). GT's margins are
relatively strong compared to most 'BB' category issuers, but this
is tempered somewhat by heavier seasonal working capital swings
that lead to more variability in FCF over the course of a year. FCF
margins are also sensitive to raw material prices and capex
spending. Although GT's leverage is generally in-line with its
rating category and similarly rated peers, its focus on debt
reduction is likely to result in declining leverage over the longer
term.
No country-ceiling, parent/subsidiary or operating environment
aspects impact the rating.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for the issuer
include:
-- Global tire industry demand grows modestly over the next
several years on relatively stable OEM production and a higher
number of global vehicles in use;
-- GT's sales grow modestly over the next several years on modest
global unit volume growth and favorable pricing and product mix;
-- Capital spending runs at roughly 5.5% of revenue over the next
several years;
-- The company uses FCF to reduce debt over the 2018 through 2021
time frame as it focuses on strengthening its balance sheet;
-- Cash pension contributions run between $25 million and $50
million per year over the intermediate term;
-- The company generally maintains at least $800 million in cash
on its balance sheet, with excess cash used primarily for debt
reduction.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to a
Positive Rating Action
-- Demonstrating continued growth in tire unit volumes, market
share and pricing;
-- Maintaining 12-month FCF margins of 2% or better for an
extended period;
-- Maintaining EBITDA leverage near 2.0x or lower for an extended
period;
-- Maintaining FFO adjusted leverage near 3.0x or lower for an
extended period.
Developments That May, Individually or Collectively, Lead to a
Negative Rating Action
-- A significant step-down in demand for the company's tires
without a commensurate decrease in costs;
-- An unexpected increase in costs, particularly related to raw
materials, that cannot be offset with higher pricing;
-- A decline in the company's consolidated cash below $800
million for several quarters;
-- Maintaining 12-month FCF margins to below 0.5% for a prolonged
period;
-- Maintaining gross EBITDA leverage above 3.0x for a sustained
period;
-- Maintaining FFO adjusted leverage to above 4.0x for a
sustained period.
LIQUIDITY
Fitch expects GT's liquidity to remain adequate over the
intermediate term. At Sept. 30, 2018, GT had $896 million in cash
and cash equivalents, augmented by about $2.1 billion in
availability on various global credit facilities. Credit facility
availability included about $1.6 billion in availability on the
company's primary U.S. and European revolvers. GT has no
significant debt maturities before 2020, although it had $445
million in short-term notes payable and overdrafts outstanding at
Sept. 30, 2018, as well as $338 million in other capital lease and
debt payments coming due over the next 12 months. In addition, the
company had $540 million in off-balance sheet factoring outstanding
at Sept. 30, 2018.
Based on its criteria, Fitch treats cash needed to cover seasonal
changes in cash flows and other cash obligations as "not readily
available" for purposes of calculating net metrics. Based on the
seasonality in GT's business, Fitch has treated $509 million of
GT's consolidated cash at Sept. 30, 2018 as not readily available.
FULL LIST OF RATING ACTIONS
Fitch has affirmed the following ratings with a Stable Outlook:
The Goodyear Tire & Rubber Company
-- IDR at 'BB';
-- Secured revolving credit facility at 'BB+'/'RR1';
-- Secured second-lien term loan at 'BB+'/'RR1';
-- Senior unsecured notes at 'BB'/'RR4'.
Goodyear Dunlop Tires Europe B.V.
-- IDR at 'BB';
-- Secured revolving credit facility at 'BB+'/'RR1';
-- Senior unsecured notes at 'BB'/'RR2'.
IMAGINE GROUP: S&P Cuts Issuer Credit Rating to B-, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings lowers its issuer credit rating on Imagine to
'B-' from 'B', the issue-level rating on the first-lien credit
facility to 'B-' from 'B', and issue-level rating on the
second-lien term loan to 'CCC' from 'CCC+'. The recovery ratings
are unchanged.
U.S.-based The Imagine Group LLC has produced lower-than-expected
cash flows year to date relative to its debt burden due to
higher–than-expected costs and working capital use. S&P expects
free operating cash flow (FOCF) to debt to remain under 5% in the
next 12 months.
S&P said, "The downgrade reflects our expectation that the
company's lower-than-expected operating performance over the past
18 months will continue, leading to FOCF to debt sustained below
5%, which we view as very low for a commercial printer.
Specifically, due to high debt interest costs, poor working capital
management, and client program delays, we expect FOCF for 2018 to
be negligible and only slightly improve by 2019 year-end.
Our stable outlook reflects our expectation that FOCF to debt will
remain at or below 5% over the next 12 months. We expect the
company will continue to face significant competition and ongoing
restructuring costs will pressure EBITDA generation and cash flows
despite modest revenue growth. We expect the company to maintain
adequate liquidity to support its operations and fixed charges.
"We could lower our issuer credit rating on Imagine if we expect
the company to face liquidity pressure as a result of its inability
to sustainably generate positive cash flows due to
underperformance. This could result from poor revenue growth due to
competitive pressures or overall economic challenges, declining
EBITDA margins due to the company's inability to effectively cut
costs and integrate acquisitions, and poor working capital
management.
Strong operating performance such as the company achieving
mid-single-digit percentage organic revenue growth and improving
adjusted EBITDA margins above the high-teens percentage area are
key drivers for an upgrade. These factors would allow the company
to successfully lower leverage below the 6x area and improve FOCF
to debt well above 5% on a sustained basis. S&P believes an upgrade
is unlikely over the next 12 months.
INDUSTRIAL FABRICATORS: Seeks Authority to Use Cash Collateral
--------------------------------------------------------------
Industrial Fabricators & Installers, Inc., seeks authorization from
the U.S. Bankruptcy Court of the District of Kansas for the
continued use of cash collateral in the ordinary course of its
business until Jan. 31, 2019 or until the Plan of Reorganization is
confirmed, whichever is earlier.
Bennington State Bank has asserted a perfected security interest in
all cash, cash equivalents, and accounts generated by Debtor’s
business.
The Debtor proposes to use cash collateral for payment of the
normal and necessary expenses of its business as set forth in the
Budget, which includes payroll, payroll and unemployment taxes,
worker's compensation, personal property taxes, inventory
purchases, rent, utilities, office expenses and supplies, repairs
and maintenance, vehicle expenses, travel and entertainments costs,
equipment rental and leases, legal and professional fees,
insurance, payments to the IRS for pre-petition secured tax debt, a
secured debt to Wells Fargo, a secured debt owed to Rhonda
McIntire, and a secured debt to Bennington.
The budget confirms that, with the cash on hand, the Debtor is able
to cash flow its business operation through the period requested.
The Debtor submits that the collateral pledged to Bennington State
Bank is valued at substantially more than the outstanding balances
owed on the Promissory Notes held by Bennington State Bank.
Therefore, Bennington is adequately protected. The Debtor proposes
to pay Bennington State Bank monthly payments until the Plan of
Reorganization is filed and confirmed.
In addition, the Debtor proposes to pay (a) $562 per month to
Bennington on the Line of Credit, which is an interest only payment
on the debt of $99,923 at 6.759% interest and (b) $753 per month to
Bennington on the Promissory Note, which is an interest only
payment on the debt of $129,004 at 7.009% interest. Bennington
State Bank will also be granted replacement liens, as its interest
appears, on all of the proceeds and replacements of the Cash
Collateral.
The Debtor will also make monthly reports to Bennington State Bank
and to the U. S. Trustee of receipts and expenditures of the Cash
Collateral.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ksb18-22462-11.pdf
About Industrial Fabricators & Installers
Industrial Fabricators & Installers, Inc., is a privately held
company in the stainless steel fabrication industry. The Company
offers a broad range of services centered on the custom fabrication
or modification of food handling, processing and packaging
equipment, as well as various installation services. The Company
is headquartered in Salina, Kansas.
Industrial Fabricators & Installers filed a Chapter 11 petition
(Bankr. D. Kan. Case No. 18-22462) on Nov. 29, 2018. In the
petition signed by Marc R. McIntire, president, the Debtor reported
total assets of $490,885 and liabilities of $1,995,929 as of the
bankruptcy filing. Judge Robert D. Berger oversees the case.
Erlene W. Krigel, Esq., of Krigel & Krigel, PC, serves as Debtor's
counsel, and Eric Homolka is the Debtor's financial consultant.
INTEGRO GROUP: S&P Places 'B-' Long-Term ICR on Watch Positive
--------------------------------------------------------------
S&P Global Ratings placed its 'B-' long-term issuer credit ratings
on New York-based international insurance brokerage and risk
management firm, Integro Parent Inc. and Integro Group Holdings LP
(Integro) on CreditWatch with positive implications following
EPIC's announcement that it has entered into a definitive agreement
to acquire Integro's U.S. operations.
At the same time, S&P also placed its 'B-' debt rating on Integro's
revolver and first-lien term loan, and its 'CCC+' debt rating on
the company's second-lien term loan on CreditWatch with positive
implications.
The CreditWatch placement follows news that EPIC will acquire
substantially all of Integro's U.S. operations with revenue in
excess of $150 million. The remainder of Integro's business will
comprise of wholesale operations mostly in London with revenues of
around $200 million. The transaction is still subject to regulatory
approval and S&P expects a closing likely in the January 2019
time-frame. While there is uncertainty regarding the company's
ultimate capital structure following the sale, S&P thinks there is
a strong possibility that credit metrics will improve post sale
through debt pay-down given a requirement in company's
credit-agreement for company to use the proceeds from the sell-off
to pay down the debt or for acquisitions within one year.
S&P said, "We will resolve the CreditWatch placement around the
close of the transaction and once we have clarity on use of
proceeds and ultimate capital structure post transaction. The
CreditWatch Positive placement indicates that we will likely affirm
or raise our ratings following our review."
INTERNATIONAL BRIDGE: IBCM Buying Machine & Equipment for $52K
--------------------------------------------------------------
International Bridge Corp. the U.S. Bankruptcy Court for the
District of Kansas to authorize the sale other than in the ordinary
course of business of equipment used in its business or located on
its premises including, but not limited to, the machinery and
equipment, to International Bridge Construction Marianas, Inc.
("IBCM") for $52,000.
The Machinery and Equipment are valued at $187,902 and $219,267 in
the Debtor's Schedules. The Debtor would like to sell all of its
Machinery and Equipment, and respectfully asks that the Court
approves the sale to IBCM for the sale price of $52,000. The
parties have entered into their Agreement for Purchase and Sale of
Assets.
The proposed Buyer of the Machinery and Equipment is related to the
Debtor, in that IBCM is owned by William Toelkes, the father of the
owner of the Debtor and former owner of the Debtor. The proposed
sale is the only ongoing current business relationship between the
Debtor and IBCM.
The Machinery & Equipment are located in Kansas, Guam, Tinian, and
other of the Northern Marians Islands. It is very expensive, and
not cost effective, for the Debtor to gather and sell the Machinery
and Equipment. IBCM is willing to purchase the Machinery and
Equipment "as-is, where-is."
The estate does not have sufficient unencumbered funds on hand with
which to gather and sell the Machinery and Equipment. For several
months, the Debtor has tried to market and sell the Machinery &
Equipment. It was unable to procure another purchaser.
These creditors have asserted secured claims in the matter:
A. The Internal Revenue Service filed Proof of Claim 1 on May
13, 2015, for Taxes in the amount of $4,512,197, asserting priority
in the amount of $19,862;
B. TOA Corp. filed Proof of Claim 17 on Aug. 31, 2015, in an
amount in excess of $10,245,491, which has since been withdrawn;
C. The Government of Guam filed Proof of Claim 19 on Sept. 4,
2015, for Federal Withholding Taxes in the secured amount of
$2,886,042, with an additional unsecured amount of $852,435;
D. Guam also filed Proof of Claim 21 on Sept. 4, 2015, for
Business Privilge Tax (G.R.T.) in the priority amount of $383,579;
E. Additionally, Guam filed Proof of Claim 22 on Sept. 4,
2015, for Business Privilge Tax (G.R.T.) in the secured amount of
$1,785,730, with an additional unsecured amount of $154,230; and
F. Leidos, Inc. for Leidos Constructors, LLC, formerly known
as SAIC Contructors, LLC, filed Proof of Claim 26 on Oct. 6, 2015,
for money lent in the amount of $4,122,852.
All of these creditors assert, or have asserted, a secured claim.
As of the Filing Date, the Debtor was indebted to the IRS in the
approximate amount of $4,477,161. plus accrued interest and
penalties. The Debtor asks that the Court finds the secured claim
of the IRS to be first in priority over all other secured claims
with regard to proceeds from the sale of the Machinery and
Equipment. The sale should be free and clear of all liens and
encumbrances. The Debtor proposes to apply the net proceeds from
the sale of the Machinery and Equipment toward the debt owed to
IRS.
The Debtor believes that the proposed sale is in the best interests
of the estate and creditors of the estate.
A copy of the list of Machine and Equipment to be sold attached to
the Motion is available for free at:
http://bankrupt.com/misc/International_Bridge_296_Sales.pdf
About International Bridge Corp.
International Bridge Corporation, a contractor for government
projects in the South Pacific and Guam, sought Chapter 11
protection (Bankr. D. Kan. Case No. 15-20951) in Kansas City on May
7, 2015. The Debtor is an Ohio corporation, with its principal
place of business in Berryton, Kansas. Robert Toelkes, the sole
shareholder and manager, signed the petition.
The Debtor disclosed total assets of $17.4 million and total debt
of $27.4 million.
The case is assigned to Judge Robert D. Berger.
The Debtor tapped Wesley F. Smith, Esq., at Stevens & Brand, LLP,
as its counsel. Wyatt A. Hoch, Esq., at Foulston Siefkin, LLP,
serves as the Debtor's special litigation counsel. Robert G. Nath,
at Robert G. Nath, PLLC, serves as special tax counsel to the
Debtor.
JAMES GARRISON: Douglases Buying Moaz Marital Home for $179K
------------------------------------------------------------
James Michael Garrison asks the U.S. Bankruptcy Court for the
Northern District of Alabama to authorize the sale of his marital
home located at 447 Copeland Drive, Boaz, Alabama to Charles
Douglas and Brenda Douglas for $179,000.
The Debtor and his estranged spouse have entered into the Purchase
Agreement with the Buyers for the purchase of their marital home
for the agreed purchase price of $179,000, with $500 earnest
money.
The property is subject to a mortgage in favor of Alabama Power
Credit Union, with a scheduled debt of $132,355. No claim has been
filed. The property is also subject to a one-half ownership
interest of the Debtor's estranged spouse. All liens, mortgages,
or other interests will attach to the proceeds of the sale.
The sale is not in the ordinary course of the Debtor's business.
The Debtor asks the Court to authorize him to sell the property and
use the proceeds to pay the balance owed to Alabama Power Credit
Union and his estranged spouse's one-half interest. The net
proceeds to Debtor will be deposited into his plan account.
A copy of the Agreement attached to the Motion is available for
free at:
http://bankrupt.com/misc/James_Garrison_70_Sales.pdf
James Michael Garrison sought Chapter 11 protection (Bankr. N.D.
Ala. Case No. 18-41820) on Oct. 26, 2018. The Debtor tapped
Tameria S. Driskill, Esq., as counsel.
JEANETTE CALICCHIA: Gurkas Buying Mahopac Property for $600K
------------------------------------------------------------
Jeanette Calicchia asks the U.S. Bankruptcy Court for the Southern
District of New York to authorize the sale of her interest in the
home at 18 Stephanie Lane, Mahopac, New York to Cindy and Steven
Gurka for $599,900, subject to higher and better offers.
A hearing on the Motion is set for Feb. 15, 2019 at 10:00 a.m.
Objections, if any, must be filed at least seven days prior to the
return date.
The asset transferred consists of the Home. The Debtor's primary
asset is the Home. She wishes to sell the Home and relocate to an
apartment owned by her brother-in-law. The Debtor engaged Exprop
Real Estate, Inc. An application for Exprop's retention is
forthcoming.
For approximately two years, the Debtor has been trying to sell the
Home. In July 2018, she entered into a contract to sell the Home
to the Purchasers. Unfortunately, the Debtor was not able to
consummate the sale prepetition due primarily to the inability to
convey clear title to the Purchasers. Travelers Insurance had
obtained a judgment against the Debtor based upon the guaranty of a
bond.
The contract price will be paid as follows: $59,900 deposit with
balance of $540,000 to be paid at closing. The sale is not
predicated on the purchasers obtaining a mortgage commitment. The
sale is free and clear of all liens, claims and encumbrances which
will attach to the proceeds.
There are three mortgages on the Home. The first mortgage is held
by M&T Bank with an approximate amount due of $380,000. The second
mortgage is held by Citi with an approximate amount due of $45,566.
The third mortgage is held by M&T Bank with an approximate amount
due of $55,000. Travelers holds a judgment in the amount of $1.6
million.
By the Motion, the Debtor asks an order from the Court (i)
authorizing the sale of the Home to the Purchasers pursuant to the
terms set forth in the contract free and clear of all liens and
encumbrances; (ii) approving distribution of the proceeds and
payment of fees and (c) ; and (iii) granting such other and relief
as is just proper.
The Home is a financial burden to the Debtor and her estate. The
expenses associated with the Home, including the mortgage, real
property taxes, and insurance, are depleting the Debtor's
resources. The Home is essentially a "wasting asset." Given the
current instability in the real estate market, the Debtor is
fortunate to be selling the Premises.
Following the sale, the following approximate amounts should be
paid: (i) First Mortgage held by M&T Bank - Approximately $348,000;
(ii) Second Mortgage held by Citi - Approximately $45,000; (iii)
Third Mortgage held by M&T Bank - Approximately $55,000; (iv)
transfer fees (TP-584) - $10,000; and (v) Real Estate Broker's fees
and legal fees (subject to Court approval) at $50,000 under 506(0).
Alternatively, the Debtor requests that the Court approves of the
sale with the proceeds, but for title charge and transfer taxes, to
be held in escrow pending further application to the Court. It is
expected that M&T Bank will not receive payment on the third
mortgage as the sale proceeds are sufficient only to pay the
expenses associated with the sale and the senior mortgages.
A copy of the Contract attached to the Motion is available for free
at:
http://bankrupt.com/misc/Jeanette_Calicchia_9_Sales.pdf
Counsel for the Debtor:
Anne J. Penachio, Esq.
PENACHIO MALARA LLP
245 Main Street - Suite 450
White Plains, New York 10601
Telephone: (914) 946-2889
Facsimile: (914) 206-4884
E-mail: apenachio@pmlawllp.com
Jeanette Calicchia sought Chapter 11 protection (Bankr. S.D.N.Y.
Case No. 18-23840) on Nov. 30, 2018. The Debtor tapped Anne J.
Penachio, Esq., at Penachio Malara LLP as counsel.
JEP REALTY: $88K Sale of Lexington Property to The Reisig Approved
------------------------------------------------------------------
Judge Tracey N. Wise of the U.S. Bankruptcy Court for the Eastern
District of Kentucky authorized JEP Realty, LLC's sale of the real
property specified in the Sale Agreement and generally described as
275 Newtown Pike, Lexington, Kentucky to The Reisig Group, LLC for
$88,250.
The sale is free and clear of all liens, claims, interests, and
encumbrances.
The Motion and shortened notice of hearing on the Motion is granted
and the Proposed Sale and the Sale Agreement, as modified, are
approved.
From the Modified Purchase Price, the Debtor is authorized to pay
all amounts required by the Sale Agreement, as modified, or that
may be otherwise advisable to effectuate the same, including,
without limitation: (i) title and escrow fees and costs; (ii)
closing fees and costs; (iii) recording fees; and (iv)
transportation, courier, photocopying, notarization, and all other
expenses and costs of closing. The Debtor is also authorized to pay
from the sale proceeds the abatement lien claims of LFUCG or any
prior ad valorem claim if any remain unpaid 2018 property taxes
will be prorated at closing as customary.
After payments set forth, the remainder of the Modified Purchase
Price will be paid to Community Trust Bank, Inc. on account of its
mortgage lien and to Farm Credit Services of Mid-America FLCA on
account of its judgment lien. The lienholders are directed to
comply with the Order and release their liens upon payment in order
of priority of liens. The Order is without prejudice to a
carve-out of the Proceeds for the Debtor's counsel for services in
connection with the Proposed Sale, and the Debtor is authorized to
pay same upon agreement by applicable lienholders.
Any title, closing, or escrow agent holding the Proceeds will
comply with the Order and the Court retains full jurisdiction to
ensure the same.
The Order will not be stayed by any provision of the Federal Rules
of Bankruptcy Procedure or otherwise, including any stay pursuant
to Fed. R. Bankr. P. 6004(g), and the Order will be immediately
effective upon its entry.
About JEP Realty
JEP Realty, LLC, is a privately held real estate agency in
Lexington, Kentucky.
JEP Realty filed a voluntary petition for relief with the Court
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. Ky Case
No. 18-51712) on Sept. 20, 2018. Judge Tracey N. Wise presides
over the case. In the petition signed by John E. Pappas, member,
the Debtor estimated $1 million to $10 million in assets and
liabilities. Jamie L. Harris, Esq., at DelCotto Law Group PLLC, is
the Debtor's counsel.
JOHN COBLE: $35K Sale of 13 Non-Tillable Acres in Delphi Approved
-----------------------------------------------------------------
Judge Robert E. Grant of the U.S. Bankruptcy Court for the Northern
District of Indiana authorized John Richard Coble's sale of
approximately 13.52 acres of non-tillable acres in Carroll County,
Indiana, to Tony R. and Elizabeth Jeanne Rudd for $35,000.
The sale is free and clear of liens, claims and interests, and that
the valid liens on the Subject Parcel will attach to the proceeds
of the sale.
The 14-day stay imposed by Rule 6004(h) of the Federal Rules of
Bankruptcy Procedure is waived. The sale proceeds are to be
deposited into the trust account of counsel for the Debtor and held
pending further order.
John Richard Coble filed a Chapter 11 petition (Bankr. N.D. Ind.
Case No. 17-40013) on Jan. 14, 2017 and is represented by Samuel
Hodson(KS), Esq. -- shodson@taftlaw.com -- at Taft Stettinius &
Hollister LLP.
JONES LEASE PROPERTIES: Seeks Authority to Use Cash Collateral
--------------------------------------------------------------
Jones Lease Properties LLC asks the U.S. Bankruptcy Court for the
Southern District of Iowa to authorize the interim use of cash
collateral.
The Debtor proposes that it will be authorized to use Cash
Collateral for the payment of its usual, ordinary, customary,
regular, and necessary postpetition expenses incurred in the
ordinary course of Debtor's business and for payment of those
prepetition claims approved and allowed by Order of the Bankruptcy
Court and not otherwise.
The Debtor believes Bank Orion, BlueGrass Savings Bank, Central
Bank Illinois, Exchange State Bank, First Midwest Bank, First State
Bank Shannon-Polo, IH Mississippi Valley Credit Union, Midwest Bank
of Western Illinois, Quad City Bank & Trust Co., Sauk Valley Bank &
Trust Co., and Walcott Trust & Savings Bank hold validly perfected
and enforceable liens on and security interests in, among other
things, the Debtor's real property, rents, revenues, deposit
accounts, and all proceeds thereof, all as more particularly
described and evidenced by those several security agreements,
mortgages, and assignments of rent executed by the Debtor on
various dates.
The Debtor proposes that in consideration for its use of the cash
collateral and as adequate protection for any Diminution of Value
of the Secured Creditors' security interests, the Debtor will grant
to the Secured Creditors:
(a) A validly perfected first priority lien on and security
interest in the Debtor's post-petition Collateral subject to
existing valid, perfected and superior liens in the collateral held
by other creditors, if any, and the Carve-Out. The rights, liens
and interests granted to the Secured Creditors will be based on the
Secured Creditors' rights, liens and interests in the Debtor's Cash
Collateral pre-petition.
(b) In the event of, and only in the case of Diminution of
Value of the Secured Creditors' interest in the Collateral, a
super-priority claim that will have priority in the Debtor's
bankruptcy case over all priority claims and unsecured claims
against the Debtor and its estate, now existing or hereafter
arising, of any kind or nature whatsoever including, without
limitation, administrative expenses of the kinds specified in or
ordered pursuant to the Bankruptcy Code or otherwise. This
super-priority claim will be subject and subordinate only to the
Carve-Out.
(c) As further adequate protection, the Debtor will make
post-petition monthly payments to Secured Creditors in an amount
equal to 4.0% per annum on the existing balance due and owing on
the Petition Date, unless the Debtor and Secured Creditors agree to
a different or lesser amount.
The Carve-Out will include any fees due to the U.S. Trustee
pursuant to 28 U.S.C. Section 1930 and fees and expenses incurred
by the Debtor's professionals and approved by the Court in an
amount not to exceed $25,000.
The Debtor's authorization to use cash collateral will continue for
a period extending to and including the Confirmation Date or
dismissal of the case, on an interim and final basis, subject to
the following terms and conditions:
(a) All proceeds received from the Debtor's operations of
its business, in the ordinary course of its business, and the
collection of accounts receivable and profits, will be deposited in
the DIP Accounts. Only the ordinary and usual expenses necessary to
continue operation of the business, incurred after the commencement
of the bankruptcy case, will be paid from the DIP Accounts, and
other payments as the Court will allow from time to time.
(b) The Debtor will provide to the Secured Creditors an
initial aging of all accounts receivable and accounts payable, plus
total current operating expenses and total current collections.
This report will be updated and provided to the Secured Creditors
by the 30th day of each month thereafter.
(c) The Secured Creditors will, at any time, be permitted to
conduct a full inspection of the real estate property and accounts
of the Debtor by visiting the Debtor's premises to inspect, verify
and photocopy all such records and to inspect, appraise and
document the Collateral.
(d) The Debtor will prepare and provide the Secured
Creditors with a balance sheet and income statement existing as of
the filing date of Debtor's Petition. Within thirty days of each
successive month, the Debtor will provide an updated balance sheet
and income statement along with a copy of all monthly reports
provided to the Court and/or the U.S. Trustee.
(e) All Collateral will be insured to its full value, and
Debtor will otherwise comply with the terms and conditions of the
Secured Creditors, unless the insurance on the Collateral is
currently force placed by the Secured Creditor, in which case, if
the insurance lapses or is cancelled, the Debtor will assume
responsibility for insurance on the Collateral. Evidence of
insurance listing Secured Creditors as insured mortgagee/loss payee
will be provided within thirty days of the Petition Date.
(f) If at any time the Debtor fails to properly insure the
Collateral, fails to pay any local, state or federal taxes as they
become due, fails to pay fees required by the U.S. Trustee or fails
to comply with any other term of the Cash Collateral Motion, the
Secured Creditors will give the Debtor and its attorney written
notice that it has thirty days to cure such default after the
mailing or transmission of written notice of such default.
(g) Any termination of the automatic stay under the Motion
and any Order thereon will apply to the above Chapter 11 case or
any subsequent dismissal.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/iasb18-02568-23.pdf
About J.P. Apartments
JP Rentals, LLC and Jones Lease Properties, LLC are a locally owned
and operated rental property companies serving the Quad Cities and
surrounding areas. As the source for rental living, they offer a
wide variety of rental properties including apartment complexes,
single family homes, townhomes, and duplexes.
J.P. Apartments Cooperative, Jones Lease Properties, LLC and J.P.
Rentals, LLC, filed their voluntary petitions under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Iowa Case Nos. 18-02566, 18-02568,
and 18-02569, respectively) on Nov. 26, 2018. In the petition
signed by Erik R. Jones, director, J.P. Apartments disclosed
$4,765,888 in total assets and $4,689,693 in liabilities.
Bradshaw, Fowler, Proctor & Fairgrave PC, led by attorney Jeffrey
D. Goetz, is the Debtor's counsel; and GlassRatner Advisory &
Capital Group, LLC, as its financial advisor and investment banker.
LEGAL COVERAGE: Trustee Selling Business Assets to Legal for $20K
-----------------------------------------------------------------
Leslie Beth Baskin, the Chapter 11 trustee for The Legal Coverage
Group Ltd., asks the U.S. Bankruptcy Court for the Eastern District
of Pennsylvania to authorize the sale business assets to Legal Risk
Services, Inc., doing business as Discount Legal Plan, for $20,000,
subject to higher and better bids.
LCG's principal, Gary A. Frank, committed fraud upon LCG's
creditors by, inter alia, greatly misrepresenting the size and
revenue of the business, by fabricating documents to support that
misrepresentation and by fraudulently taking funds of LCG.
The Trustee has continued to operate the business in a much reduced
office space. The object of operating the business was to maintain
it through the Chapter 11 process in order to sell it as a going
enterprise and to realize more value for the Estate than if it was
shut-down and dissolved with its scant physical assets sold for
salvage.
The Trustee's Court-appointed accountant, Asterion, Inc., has
analyzed the value of the business. The value of the business
depends on the attrition of its Worksites. Since the Chapter 11
filing, most Worksites have terminated/not renewed their contracts.
This is due largely to the publicity associated with the fraud
perpetrated by Frank.
Asterion has issued a report which, inter alia, rates the
acquisition of LCG as a risky investment. It opined that if LCG
retains 100 percent of current customers its fair market value is
estimated to be $237,370. If it suffered a 10% attrition its value
is estimated at $112,332. If it suffered a 20% attrition its value
is estimated to be zero. Given the publicity associated with
Frank's fraud prosecution and LCG's bankruptcy, LCG has lost much
of its business through termination of Worksite contracts which
termination greatly exceeds 20% of its business.
The Trustee has located the Buyer who is willing to make an offer
to purchase the Business Assets. The Buyer is one of the
prospective buyers who indicated some interest in purchasing the
business assets. The Purchaser entered into the Asset Purchase
Agreement with the Trustee. The Buyer's principal is Vincent J.
Smith. Smith and his family have been involved in the legal
service business for many years. Smith is willing to accept the
risk posed by potential Worksite attrition based on his own
knowledge of the business.
The Trustee respectfully asks the Court's approval to sell the
Business Assets, free and clear of any and all liens and
encumbrances, for $20,000 to Discount Legal, subject to higher and
better bids, if any, with the proceeds to be deposited in Trustee's
DIP account.
The Trustee will entertain competing bids to that made by Discount
Legal by way of response to the instant Motion, by submission of a
competing bid and asset purchase agreement, which competing bid
must be at least $25,000 and must be an all-cash bid. Further, the
competing bid must be in a form substantially similar to Discount
Legal's APA.
If the Trustee receives any competing bids within five business
days of the Sale Hearing, she will hold an auction at her offices
located at 1635 Market Street, 7th Floor, Philadelphia, PA 19103
within two business days of the Sale Hearing. The competing bids
must be sent to the Trustee. All subsequent offers at the auction,
if such auction is held, must be in $2,500 increments over the
Initial Competing Bid. If there are no competing bids submitted,
Trustee will seek approval of the APA of Discount Legal. The
Trustee will present to the Court, at the hearing on the Motion the
highest and best offer for the purchase of the Business Assets and
assumption and assignment of leases and contracts and asks that the
Court approves the sale, assumption and assignment.
The Trustee respectfully asks expedited consideration of the
subject Motion in that time is of the essence: (i) the Trustee has
been advised by Discount Legal that closing must occur by Dec. 31,
2018; the Trustee has given the requisite notice to the landlord
for Debtor's offices that it intends to terminate the lease and
vacate the premises by Dec. 31, 2018 due to the high monthly lease
expense which it can no longer afford; and the secured lender, Pru,
has given no assurance that it will continue to consent to the use
of cash collateral.
The Trustee has advised the Office of the U.S. Trustee, its secured
creditors and the parties in interest of the subject Motion and
request for expedited consideration. He respectfully asks that the
hearing on the Motion be held on Dec. 18, 2018. If there are
competing bids submitted by Dec. 13, 2018, an auction will be held
on Dec. 14, 2018, with the highest and best offer being submitted
to the Court on Dec. 18, 2018, or other date selected by the Court
for a hearing.
A copy of the Agreement attached to the Motion is available for
free at:
http://bankrupt.com/misc/Legal_Coverage_525_Sales.pdf
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.
MAMMOET-STARNETH LLC: Jan. 16 Auction of All Assets Set
-------------------------------------------------------
Mammoet-Starneth, LLC, filed with the U.S. Bankruptcy Court for the
District of Delaware a notice potential staking horse hearing, bid
deadline, auction and sale hearing in connection with the sale of
all or a portion of its assets comprising various components of a
625-foot tall giant observation wheel contemplated to be built on
the north shore of Staten Island on land leased from the City of
New York.
On Dec. 15, 2017, the Debtor filed a motion asking, among other
things, entry of the Bidding Procedures Order: (i) approving
proposed bidding procedures by which it will solicit and select the
highest or otherwise best offer for the sale of all or a portion of
its interest in the assets listed on Schedule 13 attached to the
Bidding Procedures through one or more sales of the Assets; (ii)
approving the form and manner of notice with respect to certain
procedures, protections, schedules, and agreements described herein
and attached hereto; (iii) scheduling (a) a Stalking Horse Hearing,
on expedited notice, to approve the Debtor's selection of one or
more stalking horse bidders, if any, and the provision of Bid
Protections to any such Stalking Horse Bidder, if necessary; (b)
an Auction if the Debtor receives two or more timely and acceptable
Qualified Bids for all or some of the Assets; and (c) a final
hearing to approve one or more Sales of the Assets. The Court
entered the Bidding Procedures Order on Dec. 6, 2018.
Pursuant to the Bidding Procedures Order, the Debtor is authorized
to enter into one or more agreements with one or more Stalking
Horse Bidders regarding a Sale Transaction. In the event the
Debtor enters into a Stalking Horse Agreement, the Debtor will file
and serve notice of the designation of the proposed Stalking Horse
Bidders and the proposed Stalking Horse Agreements on the entities
on the Rule 2002 Notice List, all parties expressing interest in
the Assets, and all parties in possession of the Assets at least
four days prior to the Auction.
In the event the Debtor enters into a Stalking Horse Agreement, it
will ask expedited approval of its entry into such agreement and
any Bid Protections included therein together with the terms and
conditions under which such Bid Protections would be payable to the
Stalking Horse Bidder at least three days prior to the Auction.
Pursuant to the Bidding Procedures Order, if the Debtor receives
two or more timely and acceptable Qualified Bids for the same
Assets, the Debtor will conduct the Auction on Jan. 16, 2019
starting at 10:00 a.m. (EST) at Richards, Layton & Finger, P.A.,
One Rodney Square, 920 North King St., Wilmington, DE 19801, or
such other place and time as the Debtor will notify all Qualified
Bidders. Any Qualified Bidder or party in interest may participate
in the Auction telephonically.
Any party that wishes to take part in this process and submit a bid
for the Assets must submit its Bid in accordance with the Bidding
Procedures by Jan. 11, 2019 at 4:00 p.m. (EST). Only the Debtor,
the Stalking Horse Bidder(s) (if any), any other Qualified Bidder
and/or other parties as the Debtor may determine to include in its
discretion, in each case, along with their representatives and
advisors, will be entitled to attend the Auction, and only
Qualified Bidders will be entitled to make Overbids at the Auction.
All interested or potentially affected parties should carefully
read the Bidding Procedures and the Bidding Procedures Order.
The Sale Hearing is set for Jan. 23, 2019 starting at 1:30 p.m.
(EST). The Sale Objection Deadline is Jan. 18, 2019 at 4:00 p.m.
(EST).
About Mammoet-Starneth
Mammoet-Starneth, LLC, based in Wilmington, Delaware, designs and
constructs giant observation wheels and structures.
Mammoet-Starneth sought Chapter 11 protection (Bankr. D. Del. Case
No. 17-12925) on Dec. 13, 2017. In the petition signed by
Christiaan Lavooij, manager, the Debtor estimated assets and
liabilities in the range of $100 million to $500 million.
Judge Laurie Selber Silverstein is the case judge.
The Debtor tapped Sills Cummins & Gross P.C. as its lead counsel,
and Jason M. Madron, Esq., at Richards, Layton & Finger, P.A., as
its co-counsel. William Henrich, CRO, at Getzler Henrich &
Associates, LLC, serves as the Debtor's restructuring advisor.
MANSFIELD BOAT: Seeks to Hire Lusky & Associates as Counsel
-----------------------------------------------------------
Mansfield Boat and RV Storage, LLC, seeks approval from the U.S.
Bankruptcy Court for the Northern District of Texas to hire Lusky &
Associates, P.C. as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code and will provide other legal services related to
its Chapter 11 case.
Herman Lusky, Esq., the attorney who will be handling the case,
charges an hourly fee of $385. Paralegals charge $85 per hour.
Prior to the petition date, the firm received the sum of $15,000
from the Debtor, of which $1,717 was used to pay the filing fee.
Mr. Lusky disclosed in a court filing that he and other members of
his firm neither hold nor represent any interest adverse to the
Debtor and its bankruptcy estate.
The firm can be reached through:
Herman A. Lusky, Esq.
Lusky & Associates, P.C.
5473 Blair Rd.
Dallas, TX 75231
Tel: 972-386-3900
Fax: (800) 208-6389
Email: mail@lusky.com
About Mansfield Boat and RV Storage
Mansfield Boat and RV Storage, LLC, operates a self-storage
facility in Mansfield, Texas.
Mansfield Boat and RV Storage sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. N.D. Texas Case No. 18-33926) on Dec.
3, 2018. At the time of the filing, the Debtor estimated assets of
$10 million to $50 million and liabilities of $1 million to $10
million. The case has been assigned to Judge Harlin DeWayne Hale.
METROPISTAS: Moody's Hikes Rating on $435MM Notes to Ba3
--------------------------------------------------------
Moody's Investors Service upgraded the rating assigned to
Metropistas' $435 million 6.75% amortizing Senior Secured Notes due
2035 to Ba3 from B1. The outlook on the rating is stable.
RATINGS RATIONALE
The rating upgrade to Ba3 from B1 reflects Metropistas' solid
traffic and revenue trends that Moody's expects to continue despite
the demanding economic perspectives facing the Commonwealth of
Puerto Rico (Ca negative). Following a short-lived impact from
Hurricane Maria, Metropistas' traffic grew 7.6% for the period
January - November 2018 compared to the same period in 2017.
Revenues grew by 9.6% in the same period, supported by the
sustained traffic and toll increases.
The essentiality of the service that Metropistas provides as a
primary way of entry to San Juan, the capital city of Puerto Rico,
has provided the asset with strong resiliency. Traffic trends have
been largely immune to Puerto Rico's economic performance as
measured by the Commonwealth's GNP. Similarly, the island's
negative demographic trends have not materially affected traffic
results. Other measures have also supported revenue growth. In 2017
Metropistas implemented bi-directional tolling that allowed to
recapture traffic. The overall poor conditions of alternative free
routes and reconstruction works also supports Metropistas'
traffic.
The underlying credit quality of Metropistas also considers the
long term of the concession which matures in 2061 following a 2016
amendment to extend the concession by 10 years. The regulatory
environment has been supportive to date. The concession allows for
an annual toll increase of US CPI +1.5% that does not require any
further approval from the government and that has been implemented
without disruption. Solid project finance features, including a
12-month Debt Service Reserve Account and a 12-month Major
Maintenance Account are also incorporated in its rating.
Moody's projects that Metropistas's Debt Service Coverage Ratio
("DSCR" annuity based) will reach 1.67x by the end of 2018. Moody's
also expects this ratio to continue improving, even under scenarios
of flat traffic growth, given its expectation of continuous toll
increases and de-leveraging of the asset. Moody´s will closely
assess the evolution of Metropistas' traffic profile and the
potential impact that a winding down of reconstruction related
activities could have on the asset´s performance.
RATING OUTLOOK
The stable outlook reflects its expectation that traffic will
remain resilient to Puerto Rico's weak economic conditions and
operating environment.
WHAT COULD CHANGE THE RATING UP/DOWN
Metropistas' rating could face upward pressure if traffic trends
are sustained at a Moody's projected DSCR of 1.8x or higher. In
addition, upward pressure would require its assessment of
demonstrated progress to address early on the refinancing of a bank
loan of $300.2 million (outstanding as of September 2018) maturing
in 2022.
Negative pressure could develop if traffic trends shift such that
Moody's projected DSCR falls below 1.3x on a sustained basis or as
a result of its assessment of increased refinancing risk. While
unexpected, any government interference on the concession would
weigh negatively on the ratings.
ABOUT METROPISTAS
Metropistas operates the PR-22 and the PR-5 toll-roads in San Juan
under a concession from the Puerto Rico Highway and Transportation
Authority (C negative). In August 2013, Metropistas issued $435
million (original face value) of 6.75% Senior Secured Notes due
2035 with quarterly debt service payments. As of September 2018,
the Notes have an outstanding balance of approximately $416.7
million. The Notes also rank pari passu with a bank loan due in
2022 that amortizes on a cash sweep basis and has an outstanding
balance of $300.2 million as of September 2018.
The principal methodology used in this rating was Privately Managed
Toll Roads published in October 2017.
MORRIS AND HADLEY: May Use Cash Collateral on Final Basis
---------------------------------------------------------
The Hon. Mark X. Mullin of the U.S. Bankruptcy Court for the
Northern District of Texas has signed an agreed final order
authorizing Morris and Hadley Inc. to continue operating its
business and use cash collateral to pay expenses arising in the
ordinary course of business per the budget on a final basis.
The Internal Revenue Service will be granted replacement liens on
postpetition cash collateral and property of the Debtor, including
inventory, accounts receivable, cash, cash equivalents,
intangibles, and all other post-petition property of the Debtor,
including proceeds and products thereof, but only to the same
extent, validity and priority that existed prepetition. The
replacement lien will be in addition to the liens that the IRS had
in the assets of the Debtor as of the petition date. To the extent
a lien is created in accounts receivable, and assets received,
accruing, or becoming the Debtor's property on a post-petition
basis, such replacement lien will extend only to protect the IRS
for the amounts of cash collateral used on a postpetition basis.
As further adequate protection, the Debtor will make a monthly
adequate protection payment to the IRS in the amount of $800, on
the 15th day of each month until further order of the Court, to be
applied on the secured prepetition tax debt. The Debtor will make
said payment to the United State of America, Attn: Donna Webb, 1100
Commerce St. Ste. 300, Dallas, Texas 75242.
The Debtors will be entitled to utilize the asserted cash
collateral of the IRS and to utilize the property in which the IRS
has asserted a secured interest subject to the provisions of the
Agreed Order under the following terms and conditions:
(1) The Debtors will file all past due tax returns, if any,
(including, but not limited to, income, excise, employment, and
unemployment returns) within 60 days of the entry of the Order and
will file such return with Leo Carey, Bankruptcy Specialist, IRS,
Insolvency Group II, Stop: MC5026DAL, 1100 Commerce St., Dallas,
Texas 75242.
(2) The Debtors will file all post-petition federal tax
returns on or before the due date, and will pay any balance due
upon filing of the return.
(3) The Debtors will, during the pendency of this bankruptcy
case, provide proof of deposit of all federal trust fund taxes
within seven days from the date on which they are deposited. Proof
of said deposit will be sent to the IRS.
(4) Upon reasonable notice, the Debtors will, during the
pendency of this case, permit the IRS to inspect, review, and copy
any financial records of the Debtor.
A full-text copy of the Final Order is available at
http://bankrupt.com/misc/txnb18-44350-22.pdf
About Morris and Hadley Inc.
Morris and Hadley Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Texas Case No. 18-44350) on Nov. 5,
2018. In the petition signed by Steven R. Morris, president, the
Debtor estimated assets of less than $50,000 and liabilities of
less than $100,000. Judge Mark X. Mullin presides over the case.
The Debtor tapped Acker Warren, P.C., as its legal counsel.
NASHVILLE PHARMACY: Seeks to Hire Bass Berry as Legal Counsel
-------------------------------------------------------------
Nashville Pharmacy Services, LLC, seeks approval from the U.S.
Bankruptcy Court for the Middle District of Tennessee to hire Bass,
Berry & Sims PLC as its legal counsel.
The firm will provide the Debtor with legal advice regarding its
duties under the Bankruptcy Code and will assist the Debtor in
other matters that may arise in connection with its Chapter 11
case.
The Debtor will pay Bass Berry its customary hourly rates and will
reimburse the firm for work-related expenses.
Bass Berry is "disinterested" as defined in section 101(14) of the
Bankruptcy Code, according to court filings.
The firm can be reached through:
Glenn B. Rose, Esq.
Paul G. Jennings, Esq.
Gene L. Humphreys, Esq.
Bass, Berry & Sims PLC
150 Third Avenue South, Suite 2800
Nashville, TN 37201
Telephone (615) 742-6200
Facsimile (615) 742-6293
E-mail: grose@bassberry.com
E-mail: pjennings@bassberry.com
E-mail: ghumphreys@bassberry.com
- and -
Russell E. Stair, Esq.
Bass, Berry & Sims PLC
1700 Riverview Tower
900 S. Gay Street
Knoxville, TN 37902
Telephone (865) 521-6200
Facsimile (865) 521-6234
E-mail: rstair@bassberry.com
About Nashville Pharmacy Services
Nashville Pharmacy Services, LLC, operates a pharmacy specializing
in HIV and AIDS-related medicine.
Nashville Pharmacy Services sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 18-08144) on Dec.
8, 2018. At the time of the filing, the Debtor estimated assets of
$10 million to $50 million and liabilities of $10 million to $50
million. The case has been assigned to Judge Marian F. Harrison.
Bass, Berry & Sims PLC is the Debtor's counsel.
NASHVILLE PHARMACY: Seeks to Hire Tortola as Restructuring Advisor
------------------------------------------------------------------
Nashville Pharmacy Services, LLC, seeks approval from the U.S.
Bankruptcy Court for the Middle District of Tennessee to hire
Tortola Advisors, LLC as its restructuring and general business
advisor.
The services to be provided by the firm include the evaluation of a
possible sale of the Debtor's assets and of possible plans of
reorganization; assisting the Debtor in developing and maintaining
a communication plan for employees, stakeholders and the public;
constructing a 13-week cash flow projection; and assisting the
Debtor in its ongoing cash management processes.
The Debtor has agreed to pay the firm a monthly fee of $16,000.
Tortola neither holds nor represents any interest adverse to the
Debtor's bankruptcy estate, according to court filings.
The firm can be reached through:
Steve Curnutte
Tortola Advisors, LLC
2216 Abbott Martin Road, Suite 220
Nashville, TN 37215
Tel: 615-916-5296
Cell: 615-519-5304
Email: stevec@tortolaadvisors.com
Email: sdc@tortolaadvisors.com
About Nashville Pharmacy Services
Nashville Pharmacy Services, LLC, operates a pharmacy specializing
in HIV and AIDS-related medicine.
Nashville Pharmacy Services sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 18-08144) on Dec.
8, 2018. At the time of the filing, the Debtor estimated assets of
$10 million to $50 million and liabilities of $10 million to $50
million.
The case has been assigned to Judge Marian F. Harrison.
ORBCOMM INC: S&P Affirms B Issuer Credit Rating, Outlook Positive
-----------------------------------------------------------------
S&P Global Ratings is affirming the 'B' issuer credit rating and
all other ratings on ORBCOMM Inc.
U.S.-based asset tracking and connectivity provider ORBCOMM Inc.
has increased EBITDA slower than anticipated for 2018, resulting in
debt to EBITDA of 5.7x for the last 12 months ended Sept. 30, 2018,
compared with S&P's forecast of around 4.4x in 2018. This is
primarily due to the sell-through of old low-margin inventory
continuing longer than anticipated, which pressured EBITDA
margins.
S&P said, "The rating affirmation and positive outlook reflect our
view that ORBCOMM's business performance and customer acquisition
will continue into 2019. Combined with an inflection in the margin
profile, this could result in leverage declining below 4.5x over
the next year. This inflection is driven by a sell-through of old,
low-margin inventory that should conclude in the fourth quarter of
2018, driving incremental higher margin service revenue in 2019. We
also expect the company to improve its product mix to higher-margin
offerings after the old inventory is exhausted. Sales of these
lower-margin products temporarily depressed the company's EBITDA
margin and funds from operations (FFO), which we expect to reverse
in 2019.
"The positive outlook reflects the possibility of an upgrade over
the next 12 months if operating performance continues through 2019,
such that leverage improves below 4.5x due to organic EBITDA growth
from healthy demand for IoT solutions and margin expansion
opportunities in both service and equipment margins.
“We could raise the rating if adjusted leverage improves below
4.5x on a sustained basis, including the potential for ongoing
acquisitions. An upgrade would also require our confidence that the
competitive environment will remain supportive of growth prospects
and stable pricing.
"We could revise the outlook to stable if leverage remains above
4.5x over the next year. This could occur if competition
intensifies, service revenue does not materialize, or product
margin does not increase as expected, causing the company to
underperform our base-case forecast by roughly 200 basis points
(bps) on revenue or 400 bps on EBITDA margin."
ORBCOMM is a global provider of IoT solutions that enable customers
to monitor, track, and control fixed and mobile assets. These can
include trucks, marine vessels, oil and gas wells, and construction
equipment. ORBCOMM provides connectivity through its constellation
of low-orbit satellites (OG1, OG2) and service agreements with
satellite and terrestrial network providers such as Inmarsat,
Verizon, and AT&T.
Under S&P's base-case scenario it assumes:
-- Organic revenue growth of around 4%-5% in 2019, down from about
10%-11% in 2018. Revenue growth is driven by continued, but slower
addition of subscribers, which is partially offset by average
revenue per unit (ARPU) pricing pressures as the company sells
larger volumes to customers. Service revenue is expected to
modestly increase around 2%-3% as the company exits unprofitable
installations, and product revenue is expected to increase around
7% in 2019.
-- Product gross margin of around 27% and gross service margin
around 66% in 2019. S&P expects product margin to approach 30% and
service margin to approach 70% over our forecast period to 2021.
S&P believes this is achievable as the business benefits from
operating at a larger scale.
-- Adjusted EBITDA margin of around 28% in 2019.
-- Modest capital expenditures (capex) of around 6.5% of revenues
in 2019, as the company does not need to build satellite capacity.
-- Small, tuck-in acquisitions over S&P's forecast period since
the company pursues a bolt-on strategy.
Based on these assumptions, S&P arrives at the following credit
metrics:
-- Adjusted leverage of around 5x at the end of 2018, declining to
3.8x-4x by the end of 2019. This decrease is largely driven by
EBITDA margin expansion as the company exhausts low-margin
inventory and exits unprofitable installation contracts.
-- FFO to debt of around 16% in 2019, increasing to around 18% in
2020.
-- For the purpose of calculating adjusted debt, S&P has included
minimum payment guarantees, which are disclosed in the company's
filings, to our operating lease adjustment.
S&P said, "We view ORBCOMM's liquidity as adequate, reflecting our
expectation that sources will exceed uses by around 4x over the
next 12 months, and that net sources remain positive even with a
15% decline in forecast EBITDA. Still, we do not expect the company
to maintain significant excess liquidity, given the potential for
future acquisitions."
Sources of liquidity:
-- Around $45 million cash and cash equivalents as of Sept. 30,
2018.
-- Full availability under the company's $25 million revolving
credit facility maturing in 2022.
-- FFO of around $33 million over the next 12 months.
Uses of liquidity:
-- Capex of around $21 million over the next 12 months.
-- Modest working capital outflows of $7 million over the next 12
months.
The company's revolving credit facility is subject to financial
covenants, including a 5.25x maximum total net leverage ratio
covenant and a 2x minimum interest coverage ratio covenant. The
maximum total net leverage ratio covenant will step down to 4.75x
on March 31, 2019, with additional stepdowns thereafter. The
minimum interest coverage ratio covenant will step up to 2.25x on
June 30, 2019, and 2.5x on Dec. 31, 2019, with additional stepups
thereafter. We expect the company will maintain at least a 15%
cushion against its covenants over the next year.
OSG BULK: S&P Assigns B+ Rating on New $325MM Sr. Sec. Term Loan
----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue-level rating and '1'
recovery rating to Overseas Shipholding Group Inc.'s proposed $325
million senior secured term loan due December 2023, to be issued by
OSG Bulk Ships Inc. The '1' recovery rating indicates S&P's
expectation for very high recovery (90%-100%; rounded estimate:
95%) in the event of a payment default.
OSG plans to use the proceeds from the transaction, along with cash
from its balance sheet, to repay its existing $352 million
(outstanding) senior secured term loan due 2019. S&P intends to
withdraw its ratings on the company's existing $352 million term
loan and $75 million asset-based lending (ABL) facility due 2019
following closing. The company is also seeking to extend the
maturity on the ABL by six months to August 2019 and reduce the
credit line to $30 million as part of the proposed transaction.
S&P said, "We could revise the outlook on OSG to stable from
negative following the successful refinancing of its upcoming
maturities in a timely manner, eliminating refinancing risk, and
improving its liquidity position.
"We could lower our ratings on OSG over the next few months if the
company faces challenges refinancing its upcoming maturities or if
we believe its liquidity position has deteriorated such that we
revise our liquidity assessment to weak. We could also lower our
ratings if we believe the company's financial obligations are
unsustainable long-term even if it has successfully refinanced its
near-term obligations."
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
S&P said, "Our simulated default scenario assumes a payment default
occurring in 2020 amid a decline in U.S. economic activity that
leads to intensified rate competition in the domestic shipping
market and reduced volumes for the company.
"Consistent with our recovery analysis for most shipping companies,
we assess recovery prospects using a discrete asset valuation
approach. In the case of OSG, we compare each debt instrument with
our estimate of the value of the assets securing its debt
repayment."
Simulated default assumptions
-- Simulated year of default: 2020
-- Methodology used: discrete asset valuation, going concern
Simplified waterfall
-- Net enterprise value: $426 million
-- Priority claims: $19 million
-- Senior secured debt: $311 million
--Recovery expectation: 90%-100% (rounded estimate: 95%)
Note: All debt amounts include six months of prepetition interest.
RATINGS LIST
Overseas Shipholding Group Inc.
Issuer Credit Rating B-/Negative/--
New Rating
OSG Bulk Ships Inc.
Senior Secured
$325 mil term loan due 2023 B+
Recovery rating 1(95%)
PETER JENSEN: BYK LLC Buying Standish Property for $106K
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Peter Jensen asks the U.S. Bankruptcy Court for the District of
Maine to authorize him to transfer his residence 12 Beech Road,
Standish, Maine, to BYK, LLC for $106,000.
The Debtor purchased his residence for approximately $105,000. At
the time his case was filed, he listed the property with a value of
$96,000.
Bangor Savings Bank/Fannie Mae is owed at least $112,711 on its
mortgage. Upon information and belief, the property may be
encumbered by a second mortgage to Gorham Savings Bank. Upon
information and belief, Maine Revenue and/or Internal Revenue
Service may hold liens against the property.
The Debtor wishes to pursue a short sale to facilitate the
foreclosure process to render himself more eligible to address his
income tax liabilities under the Bankruptcy Code. He has pursued
short sale negotiations with Fannie Mae, the insurer of the
mortgage, for many months.
Upon information and belief, Fannie Mae either has accepted the
amount of the offer made by BYK, or will in the near future (the
offer is for $106,000 -- at last communication, Fannie Mae had
agreed to accept $110,000).
The parties have entered into a purchase and sale agreement signed
by BYK for $106,000. Upon information and belief, the Buyer is not
related to the Debtor.
The sale is in the best interests of creditors and the estate
because it will ensure prompt liquidation of the asset, maximize
the proceeds for Bangor Savings Bank/Fannie Mae, and enable the
Debtor to move his case forward efficiently.
A hearing on the Motion is set for Jan. 29, 2019 at 9:00 a.m. The
objection deadline is Jan. 15, 2019.
The Purchaser:
Michael Boyd
BYK, LLC
1 Monument Sq., 2nd Floor
Portland, ME 04101
Counsel for Debtor:
J. Scott Logan, Esq.
LAW OFFICE OF J. SCOTT LOGAN, LLC
75 Pearl Street, Ste. 211
Portland, ME 04101
Telephone: (207) 699-1314
E-mail: scott@southernmainebankruptcy.com
The case is In re Peter Jensen (Bankr. D. Maine Case No.
17-20586).
PETROQUEST ENERGY: Committee Hires Heller Draper as Counsel
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The Official Committee of Unsecured Creditors of Petroquest Energy,
Inc., and its debtor-affiliates, seeks authorization from the U.S.
Bankruptcy Court for the Southern District of Texas to retain
Heller Draper Patrick Horn & Manthey, LLC, as counsel to the
Committee.
The Committee requires Heller Draper to:
a. advise the Committee in connection with its powers and
duties under the Bankruptcy Code, the Bankruptcy Rules and
the Bankruptcy Local Rules;
b. assist and advise the Committee in its consultation with
the Debtors relative to the administration of these cases;
c. attend meetings and negotiate with the representatives of
the Debtors and other parties-in-interest;
d. assist and advise the Committee in its examination and
analysis of the conduct of the Debtors' affairs;
e. assist and advise the Committee in connection with any sale
of the Debtors' assets pursuant to section 363 of the
Bankruptcy Code;
f. assist the Committee in the review, analysis and
negotiation of any chapter 11 plans of reorganization or
liquidation that may be or have already been filed and
assist the Committee in the review, analysis and
negotiation of the disclosure statement accompanying any
such plans;
g. assist the Committee in analyzing the claims asserted
against and interests asserted in the Debtors, in
negotiating with the holders of such claims and interests,
and in bringing, participating in, or advising the
Committee with respect to contested matters and adversary
proceedings, including objections or estimation
proceedings, with respect to such claims or interests;
h. assist with the Committee's review of the Debtors'
Schedules of Assets and Liabilities, Statements of
Financial Affairs and other financing reports prepared by
the Debtors, and the Committee's investigation of the acts,
conduct, assets, liabilities and financial condition of the
Debtors and of the historic and ongoing operation of their
businesses;
i. assist the Committee in its analysis of, and negotiations
with, the Debtors or any third party related to, among
other things, cash collateral issues, financings,
compromises of controversies, assumption or rejection of
executory contracts and unexpired leases, and matters
affecting the automatic stay;
j. take all necessary action to protect and preserve the
interests of the Committee, including (i) possible
prosecution of actions on its behalf; and (ii) if
appropriate, negotiations concerning all litigation in
which the Debtors are involved;
k. generally prepare on behalf of the Committee all necessary
motions, applications, answers, orders, reports, replies,
responses and papers in support of positions taken by the
Committee;
l. appear, as appropriate, before this Court, the appellate
courts, and the United States Trustee, and protect the
interests of the Committee before those courts and before
the United States Trustee; and
m. perform all other necessary legal services in these cases.
Heller Draper will be paid at these hourly rates:
Partners $395-$545
Associates $225-$325
Paralegals $150
Heller Draper will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Tristan E. Manthey, partner of Heller Draper Patrick Horn &
Manthey, LLC, assured the Court that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and (a) is not creditors, equity security holders or insiders
of the Debtors; (b) has not been, within two years before the date
of the filing of the Debtors' chapter 11 petition, directors,
officers or employees of the Debtors; and (c) does not have an
interest materially adverse to the interest of the estate or of any
class of creditors or equity security holders, by reason of any
direct or indirect relationship to, connection with, or interest
in, the Debtors, or for any other reason.
Heller Draper can be reached at:
Tristan E. Manthey
HELLER DRAPER PATRICK HORN
& MANTHEY, LLC
650 Poydras Street, Suite 2500
New Orleans, LA 70130
Tel: (504) 299-3300
About Petroquest Energy
PetroQuest Energy, Inc. -- http://www.petroquest.com/-- is an
independent oil and gas companies engaged in the exploration,
development, acquisition and operation of oil and gas properties in
Texas and Louisiana, primarily in the Cotton Valley, Gulf Coast
Basin, and Austin Chalk plays. The Company maintains offices in
Lafayette, Louisiana and The Woodlands, Texas. It currently employs
64 people and utilizes the services of an additional 8 specialized
and trained field workers and engineers through third-party service
providers.
Petroquest along with its seven affiliates filed for chapter 11
bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 18-36322) on
Nov. 6, 2018.
In the petition signed by Charles T. Goodson, CEO and president,
Petroquest estimated assets at $1 million to $10 million and
estimated liabilities at $100 million to $500 million.
The Hon. David R. Jones is the case judge.
Porter Hedges LLP, led by John F. Higgins, Esq., Joshua W.
Wolfshohl, Esq., and M. Shane Johnson, Esq., serves as counsel to
the Debtors. The Debtors also tapped Seaport Global Securities as
investment banker, FTI Consulting Inc as financial advisor, and
Epiq Corporate Restructuring LLC as claims, noticing and
solicitation agent.
Henry Hobbs, Jr., acting U.S. trustee for Region 7, on Nov. 20,
2018, appointed three creditors to serve on the official committee
of unsecured creditors in the Chapter 11 cases. The Committee
retained Heller Draper Patrick Horn & Manthey, LLC, as counsel.
PETROQUEST ENERGY: Hires FTI Consulting as Financial Advisor
------------------------------------------------------------
Petroquest Energy, Inc., and its debtor-affiliates seek authority
from the U.S. Bankruptcy Court for the Southern District of Texas
to employ FTI Consulting, Inc., as financial advisor to the
Debtors.
The Committee requires FTI Consulting to:
(a) support the preparation of first day motions and develop
procedures and processes necessary to implement such
motions;
(b) assist with developing accounting and operating procedures
to segregate prepetition and post-petition business
transactions;
(c) assist with the development or review of the Debtors'
business plan, as requested;
(d) work with the Debtors and their communications advisors to
develop chapter 11 communications;
(e) review or assist with the development of the Debtors' 13-
week cash flow forecast and regular variance reporting, as
requested;
(f) assist in the identification of executory contracts and
unexpired leases and performing the cost/benefit
evaluations with respect to the assumption or rejection of
each, as needed;
(g) prepare the Debtors with respect to financial disclosures
that will be required by the Court;
(h) assist with the review, classification, and quantification
of claims against the estate under the plan of
reorganization;
(i) assist with bankruptcy reporting requirements (e.g.,
Statements of Financial Affairs and Schedules of Assets
and Liabilities, Monthly Operating Reports, etc.);
(j) render general financial advice, financial analytics and
modeling as directed by the Debtors' management;
(k) assist in the development and analysis of various
strategic alternatives available to the Debtors;
(l) assist in the development of a plan of reorganization and
disclosure statement;
(m) assist in determining potential creditor recoveries under
alternative scenarios;
(n) assist in analyzing and developing strategies to address
the Debtors' existing obligations;
(o) assist with sizing and securing DIP financing, as needed;
(p) assist with evaluating the Debtors' cash flows under a
variety of scenarios;
(q) attend meetings, presentations and negotiations as may be
requested by the Debtors;
(r) assist with claims reconciliation and objections;
(s) assist with fresh-start accounting planning and
implementation;
(t) provide court testimony, as needed; and
(u) provide other services as requested by the Debtors.
FTI Consulting will be paid at these hourly rates:
Senior Managing Directors $875-$1,075
Directors $650-$855
Senior Consultants/Consultants $345-$620
Administrative/Paraprofessionals $140-$270
Prior to the Petition Date, FTI Consulting received advance
payments from the Debtors totaling $428,419.54. FTI Consulting's
fees and reimbursable expenses for the prepetition period totaled
$329,807.26. The portion of the advance payments not applied to
prepetition fees and disbursements is $98,612.29.
FTI Consulting will also be reimbursed for reasonable out-of-pocket
expenses incurred.
David Rush, senior managing director of FTI Consulting, Inc.,
assured the Court that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code and does
not represent any interest adverse to the Debtors and their
estates.
FTI Consulting can be reached at:
David Rush
FTI CONSULTING, INC.
1001 Fannin St., Suite 3950
Houston, TX 77002
Tel: (832) 667-5160
E-mail: david.rush@fticonsulting.com.
About Petroquest Energy
PetroQuest Energy, Inc. -- http://www.petroquest.com/-- is an
independent oil and gas companies engaged in the exploration,
development, acquisition and operation of oil and gas properties in
Texas and Louisiana, primarily in the Cotton Valley, Gulf Coast
Basin, and Austin Chalk plays. The Company maintains offices in
Lafayette, Louisiana and The Woodlands, Texas. It currently employs
64 people and utilizes the services of an additional 8 specialized
and trained field workers and engineers through third-party service
providers.
Petroquest along with its seven affiliates filed for chapter 11
bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 18-36322) on
Nov. 6, 2018.
In the petition signed by Charles T. Goodson, CEO and president,
Petroquest estimated assets at $1 million to $10 million and
estimated liabilities at $100 million to $500 million.
The Hon. David R. Jones is the case judge.
Porter Hedges LLP, led by John F. Higgins, Esq., Joshua W.
Wolfshohl, Esq., and M. Shane Johnson, Esq., serves as counsel to
the Debtors. The Debtors also tapped Seaport Global Securities as
investment banker, FTI Consulting Inc as financial advisor, and
Epiq Corporate Restructuring LLC as claims, noticing and
solicitation agent.
Henry Hobbs, Jr., acting U.S. trustee for Region 7, on Nov. 20
appointed three creditors to serve on the official committee of
unsecured creditors in the Chapter 11 cases of PetroQuest Energy,
Inc. and its affiliates. The Committee hires Heller Draper Patrick
Horn & Manthey, LLC, as counsel.
PETROQUEST ENERGY: Hires Seaport Global as Investment Banker
------------------------------------------------------------
Petroquest Energy, Inc., and its debtor-affiliates seek authority
from the U.S. Bankruptcy Court for the Southern District of Texas
to employ Seaport Global Securities LLC as investment banker to the
Debtors.
The Committee requires Seaport Global to:
(a) review the business and operations of the Debtors and
their historical and projected financial condition;
(b) evaluate the Debtors' assets and liabilities, including
the overall capital structure, of the Debtors;
(c) analyze business plans, forecasts and related financial
projections for the Debtors;
(d) evaluate significant aspects of the Debtors' near-term
liquidity;
(e) evaluate financing and capital raising alternatives
available to the Debtors, including assisting the Debtors'
counsel to develop a potential proposal for debtor-in-
possession financing and/or a rights offering;
(f) develop and evaluate options and implementation strategies
for one of more Transactions, including participation in
the negotiations with the Debtors' stakeholders and other
parties in interest;
(g) assist the Debtors in preparing documentation that may be
required in connection with any Restructuring;
(h) assist the Debtors in identifying and evaluate
candidates for any potential Sale Transaction, and
advise the Debtors in connection with negotiations and
assist with the consummation of any Sale Transaction;
(i) attend meetings of the Board of Directors of the Company
with respect to matters on which Seaport Global has been
engaged to advise;
(j) advise and assist the Debtors as to the particular
schedules and exhibits required upon filing a bankruptcy
case;
(k) provide testimony before the bankruptcy court with respect
to matters on which Seaport Global has been engaged to
advise;
(l) assist in the implementation and consummation of one or
more Transactions; and
(m) provide such other financial advisory and investment
banking services as may be required by the Debtors, as
described in paragraph 1 of the Engagement Letter.
Seaport Global will be paid as follows:
(a) Advisory Fees. In addition to the other fees provided for
in the Engagement Letter, an additional cash financial
advisory fee (the "Advisory Fee") in the amount of (i)
$100,000 will be payable immediately upon the execution of
the Engagement Letter; and (ii) $75,000 will be due per
month, payable every thirty (30) days after the effective
date of the Engagement Letter, on or about the same
business day of each succeeding calendar month thereafter
during the Term; provided, that the Advisory Fee shall be
credited without duplication, against any Restructuring
Fee or Placement Fee or the Minimum Fee (each term as
defined below).
(b) Restructuring Fees. A cash fee (the "Restructuring Fee")
payable upon the consummation of a Restructuring during
the Term in the amount of one and one-quarter percent
(1.25%) of (i) the principal amount of the Debtors'
senior secured debt and junior secured debt and the
liquidation preference of the Debtors' preferred stock
that are exchanged, extinguished or converted as a
result of a Restructuring completed prior to the filing of
a Bankruptcy Case or (ii) the principal amount of the
Debtors' senior secured debt and junior secured debt that
are exchanged, extinguished or converted as a result of a
Restructuring completed after the filing of a Bankruptcy
Case;
(c) Placement Fee. With respect to any new capital provided to
the Debtors (a "Placement"), a cash placement fee (the
"Placement Fee") payable upon the consummation of the
Placement during the Term in the amount of: (i) two
percent (2.0%) of the principal amount of any debt
instruments that are placed, provided that (A) no
Placement Fee shall be payable with respect to the first
$30 million (or, if greater, the outstanding amount of the
Debtors' senior secured debt at the time of the Placement
or prior to the filing of a Bankruptcy Case) of senior
secured debt instruments that are placed to refinance the
Debtors' Existing Obligations and (B) if the debt
instruments that are placed constitute debtor-in-
possession financing and such debtor-in-possession
financing converts into an exit facility, no additional
Placement Fee shall be payable with respect to
such exit facility except to the extent that the amount
available for future use by the Debtors under such exit
facility exceeds the amount outstanding under such debtor-
in-possession financing at the time of conversion, and
(ii) three percent (3.0%) of the aggregate consideration
received in connection with the placement of any equity
securities (including pursuant to any form of rights
offering), including equity-linked debt instruments;
provided, however, that a Placement Fee reduced by up to
one-half (50.0%) of the amount of the Placement Fee that
would otherwise be payable shall be payable with respect
to any debt instruments or equity securities that are
placed with certain persons listed within the Engagement
Letter, with the amount of such reduction to be determined
in good faith by the Debtors and Seaport Global based upon
the extent of the involvement and effort by Seaport
Global.
(d) Bankruptcy Filing Deposit. In the event the Debtors
determines to file or otherwise anticipates the filing of
a Bankruptcy Case, then one (1) week prior to the date of
that anticipated filing, the Debtors shall immediately pay
in cash the amount of all fees and expenses due and owing
to Seaport Global and shall deposit with Seaport Global an
expense deposit in the amount of $50,000, 3 any unused
portion of which shall be immediately returned to the
Debtors upon conclusion of the Term;
(e) Minimum/Maximum Fee. Notwithstanding any of the foregoing,
in no event shall the aggregate amount of cash fees
actually paid by the Debtors to Seaport Global during the
Term ever be less than $750,000 (the "Minimum Fee") or
exceed $4,500,000 (the "Maximum Fee"), regardless of the
type of Transaction that is actually consummated, except
that the amount of the Maximum Fee shall be increased, in
the case of any consummated rights offering where the
Debtors receives net proceeds of at least $40 million, by
the amount of the Placement Fee payable on the amount of
such net proceeds in excess of such $40 million; provided,
however, that the amount of any remaining unpaid portion
of the Minimum Fee shall be paid immediately upon
conclusion of the Term.
Michael H. Schmidt, partner of Seaport Global Securities LLC,
assured the Court that the firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code and does
not represent any interest adverse to the Debtors and their
estates.
Seaport Global can be reached at:
Michael H. Schmidt
SEAPORT GLOBAL SECURITIES LLC
400 Poydras Street, Suite 3100
New Orleans, LA 70130
Tel: (504) 410-8010
E-mail: mschmidt@seaportglobal.com
About Petroquest Energy
PetroQuest Energy, Inc. -- http://www.petroquest.com/-- is an
independent oil and gas companies engaged in the exploration,
development, acquisition and operation of oil and gas properties in
Texas and Louisiana, primarily in the Cotton Valley, Gulf Coast
Basin, and Austin Chalk plays. The Company maintains offices in
Lafayette, Louisiana and The Woodlands, Texas. It currently employs
64 people and utilizes the services of an additional 8 specialized
and trained field workers and engineers through third-party service
providers.
Petroquest along with its seven affiliates filed for chapter 11
bankruptcy protection (Bankr. S.D. Tex. Lead Case No. 18-36322) on
Nov. 6, 2018.
In the petition signed by Charles T. Goodson, CEO and president,
Petroquest estimated assets at $1 million to $10 million and
estimated liabilities at $100 million to $500 million.
The Hon. David R. Jones is the case judge.
Porter Hedges LLP, led by John F. Higgins, Esq., Joshua W.
Wolfshohl, Esq., and M. Shane Johnson, Esq., serves as counsel to
the Debtors. The Debtors also tapped Seaport Global Securities as
investment banker, FTI Consulting Inc as financial advisor, and
Epiq Corporate Restructuring LLC as claims, noticing and
solicitation agent.
Henry Hobbs, Jr., acting U.S. trustee for Region 7, on Nov. 20
appointed three creditors to serve on the official committee of
unsecured creditors in the Chapter 11 cases of PetroQuest Energy,
Inc. and its affiliates. The Committee hires Heller Draper Patrick
Horn & Manthey, LLC, as counsel.
PROMISE HEALTHCARE: Selling Equity Interests in Success for $10M
----------------------------------------------------------------
Promise Healthcare Group, LLC and its affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to authorize the
private sale of all of Debtor Success Healthcare, LLC's equity
interests in Success Healthcare 2, LLC to Americore Holdings, LLC
for $10 million.
A hearing on the Motion is set for Jan. 8, 2019 at 11:00 a.m. (ET).
The objection deadline is Dec. 21, 2018 at 4:00 p.m. (ET)
For the past 18 to 24 months, the Debtors have informally sought a
buyer for the Purchased Interests, most notably the St. Alexius
Facility. They received interest from Purchaser and no other
expressions of interest.
Upon receiving interest from the Purchaser, the Debtors and the
Purchaser negotiated a sale of the Purchased Interests, which
results in the indirect acquisition of the Interests and Shares
owned by Holdco, which further results in the acquisition of the
entities that own and operate the St. Alexius Facility and other
related businesses, including the Lutheran School of Nursing. As a
result of substantial arms'-length negotiations between Purchaser
and the Debtors, the Purchaser agreed to purchase the Purchased
Interests for $10 million and the transfer of the Excluded Assets
to Seller. Moreover, the structure resulting from the negotiations
resulted in a transaction that could close promptly after the
filing of these Chapter 11 Cases on terms favorable to the Debtors.
Given the current performance of the St. Alexius Facility and
because, among other things, (a) the Purchaser is acquiring the
Purchased Interests, as opposed to physical assets, (b) the
Purchaser is relieving the Debtors of significant potential
liability, and (c) the Purchaser has evidenced an ability to
continue to operate the Lutheran School of Nursing and continue
participation in Department of Education funding, adding value to
the Sale for the Purchaser. The Debtors believe, in their business
judgment, that it is unlikely an auction will lead to a higher or
otherwise better bid for the Purchased Interests and ask to sell
the Purchased Interests to the Purchaser, pursuant to a private
sale free and clear of all Encumbrances and interests.
The salient terms of the PSA are:
a. The Debtors are seeking approval for the Sale of the
Purchased Interests to the Purchaser by private sale for the
Purchase Price and upon the terms and conditions set forth in the
Purchase Agreement.
b. The Sale will be free and clear of all Encumbrances and
interests, with such Encumbrances and interests to attach to the
net proceeds of the sale.
c. The Purchase Agreement does not contemplate a right to
credit bid.
d. The Debtors are asking relief from the 14-day stay imposed
by Bankruptcy Rule 6004(h) for any sale.
The Debtors believe that a private sale of the Purchased Interests
will allow for the greatest possible consideration for the
Purchased Interests without unnecessary time and estate resources
being expended on a further marketing process that the Debtors do
not believe will yield a higher purchase price for the Purchased
Interests. Accordingly, the Debtors believe that the Purchase
Price is a fair and reasonable value for the Purchased Interests.
Pursuant to the Purchase Agreement, the Debtors are required to ask
to assume the Assumed Contracts and the obligations thereunder, and
to subsequently assign the Assumed Contracts to Purchaser. The
assumption of the Assumed Contracts will permit the consummation of
the Sale, thereby benefiting the Debtors and their estates, while
avoiding any further liability under the Assumed Contracts.
Accordingly, they believe that assuming the Assumed Contracts is in
the best interests of the Debtors, the Debtors' estates, their
creditors, and all other parties in interest.
Timely consummation of the Sale is of critical importance to both
the Debtors and the Purchaser and the Debtors' efforts to maximize
the value of the estates. Because of the St. Alexius Facility's
poor performance during periodic healthcare regulatory reviews,
monthly losses, and the ongoing regulatory issues with CMS, the
Debtors ask that the Court waives the 14-day stay period under
Bankruptcy Rules 6004(h).
A copy of the PSA attached to the Motion is available for free at:
http://bankrupt.com/misc/Promise_Healthcare_263_Sales.pdf
The Purchaser:
AMERICORE HOLDINGS, LLC
4337 Seagrape Drive
Lauderdale by the Sea, FL 33308
Attn: Grant R. White
The Purchaser is represented by:
Christopher B. Anderson, Esq.
JONES DAY
77 West Wacker Drive, STE 3700
Chicago, IL 60601
About Promise Healthcare
Established in 2003, Promise Healthcare is a specialty post-acute
care health company headquartered in Boca Raton, Florida.
Promise Healthcare Group, LLC and its affiliates sought bankruptcy
protection on Nov. 4, 2018 (Bankr. D. Del. Lead Case No. 18-12491).
In the petition signed by Andrew Hinkelman, chief
restructuring officer, the Debtors estimated assets of $0 to
$50,000 and liabilities of $50 million to $100 million.
The Debtors tapped DLA Piper LLP and Waller Lansden Dortch & Davis,
LLP as general counsel; FTI Consulting, as financial and
restructuring advisor; Houlihan Lokey and MTS Health Partners,
L.P., as investment bankers; and Prime Clerk LLC as claims agent.
REEL AMUSEMENTS: Has Final Authorization to Use Cash Collateral
---------------------------------------------------------------
The Hon. Marian F. Harrison of the U.S. Bankruptcy Court for the
Middle District of Tennessee has signed a final order authorizing
Reel Amusements LLC's use of cash collateral.
The Debtor is authorized to spend up to a maximum of 115% of the
amount set forth on the budget. The approved budget provides total
general and administrative expenses of approximately $1,630,390
which covers the period of Dec. 7, 2018, through April 26, 2019.
The Debtor is further authorized to use cash collateral to pay
amounts and/or any fees payable to the Clerk of the Court and to
the U.S. Trustee.
The Debtor has identified these creditors having a lien on its cash
collateral: (a) Pinnacle Bank asserts a lien on all of the Debtor's
assets and property, including its cash collateral; and (b)
Seacoast Bank and NBKC Bank, as assignees of Credibility Capital,
Inc. -- referenced as a party that may assert a lien on the
Debtor's cash collateral -- filed proofs of claim asserting claims
secured by the collateral, which includes the Debtor's cash
collateral. Pinnacle Bank and Credibility Capital Successors assert
valid, perfected security interests in and liens on the collateral.
Pinnacle Bank has not subordinated its position to Credibility
Capital or the Credibility Capital Successors, with respect to the
collateral or any of the Debtor's assets.
The Debtor, Pinnacle Bank and Credibility Capital Successors have
reached an agreement on the use of cash collateral. In return to
Debtor's use of cash collateral, the Secured Creditors are
granted:
(a) A replacement security interest in the Debtor's
post-petition property and proceeds thereof, to the same extent and
priority as its respective purported security interest in the
Debtor's prepetition property and the proceeds thereof. Said
replacement liens and security interests will be deemed perfected
upon entry of the Final Order without the necessity of the
applicable creditor taking possession of any collateral or filing
financing statements or other documents.
(b) To the extent replacement liens fail to adequately
protect the Secured Creditors, such Secured Creditor will be
entitled to a superpriority administrative expense claim, pursuant
to U.S.C. Section 507(b) in an amount equal to the diminution in
value of such Secured Creditor's security interest in and liens on
the collateral.
(c) The Debtor will keep its assets insured by reasonable and
sufficient insurance coverage as required by the terms of the loan
documents executed by the Debtor in favor of Pinnacle Bank and will
continue to provide to Pinnacle Bank proof of such insurance
coverage.
(d) The Debtor will provide Secured Creditors weekly
financial reports on the Wednesday following the prior week, which
financial reports will contain and reflect the following minimum
items: (i) the cash revenues collected and the cash expenditures
disbursed by the Debtor during the preceding week; (ii) a rolling
comparison of the actual revenues and expenditures to the budgeted
amounts per period; and (iii) such other information as may be
reasonably requested by Secured Creditors.
A full-text copy of the Final Agreed Order is available at
http://bankrupt.com/misc/tnmb18-05883-104.pdf
About Reel Amusements
Reel Amusements has been a growing business for over 20 years and
continues to be one of the leaders in the amusement industry. Reel
Amusements LLC filed a petition seeking relief under Chapter 11 of
the Bankruptcy Code (Bankr. M.D. Ten. Case no. 18-05883) on Aug.
31, 2018. At the time of filing, the Debtor estimated $500,001 to
$1 million in assets and $1 million to $10 million in liabilities.
Denis Graham (Gray) Waldron at Niarhos & Waldron, PLC, is the
Debtor's counsel.
REPUBLIC METALS: Supplements Proposed Prepaid Products Sale
-----------------------------------------------------------
Republic Metals Refining Corp. and its debtor-affiliates filed with
the U.S. Bankruptcy Court for the Southern District of New York a
supplement to their proposed sale of prepaid products on a
wholesale basis; and asks approval of the terms of the Prepaid
Product Settlement Agreement and authorization to enter into
Prepaid Product Settlement Agreements.
On Nov. 28, 2018, the Debtors filed the Sale Motion, asking
authority to, inter alia, sell the Prepaid Product free and clear
of all liens, claims, and encumbrances, with such liens, claims,
and encumbrances to attach to the proceeds of such sale in the
order and priority in which they existed as of the Petition Date,
and subject to the terms of any cash collateral orders entered in
these Chapter 11 Cases. Specifically, the Debtors proposed to
monetize the Prepaid Product on a wholesale basis, as expeditiously
as possible, in whatever manner the CRO determines in his business
judgment will be most beneficial to the bankruptcy estates. This
includes melting the product and reprocessing the gold and silver
with other inventory for sale in the ordinary course of business.
The Sale Motion is scheduled for hearing on Dec. 19, 2018.
Subsequent to filing the Sale Motion, the Debtors discussed with
the Committee and the Debtors' prepetition senior secured lenders,
the possibility and benefits of obtaining approval and authority to
settle certain similar claims related to the Sale Motion. These
same Customers may also lodge objections to the final hearing on
the Debtors' use of cash collateral which objections would be
resolved through the settlement.
As set forth in more detail in the Sale Motion, the Customers and
the Senior Lenders have told the Debtors that they assert competing
liens and/or property interests in the Prepaid Product. In an
effort to streamline and expedite the resolution of those competing
claims under the Sale Motion (and the cash collateral motion), the
Debtors, with the consent of the Committee and the Lenders, ask
approval of the standard settlement procedures and authority to
enter into standard settlements without further Court order.
The standard settlement will permit similarly situated Customers
that are: i) asserting an ownership interest in Packaged Product,
and ii) either asserting an ownership interest in other materials
or product or a liquidated amount due from any of the Debtors' pool
or toll accounts to settle as follows:
A. The Debtors will return the Packaged Product to the
settling Customer.
B. The settling Customer will agree to treat its Additional
Claim as a general unsecured claim against the applicable Debtor's
estate.
C. The Debtors will not be required to seek Court approval of
any Prepaid Product Settlement Agreement beyond the Court approval
given in any Order granting the Sale Motion, as supplemented
hereby.
D. The parties will exchange general releases, except for (i)
obligations arising under and pursuant to the Stipulation and (ii)
causes of action arising under Section 547 of the Bankruptcy Code,
provided that all Parties reserve all rights and defenses with
respect thereto.
Through the Supplement, the Debtors ask approval of the terms of
the Prepaid Product Settlement Agreement and authorization to enter
into Prepaid Product Settlement Agreements without further order of
Court. Moreover, to the extent a Customer decides not to enter a
Prepaid Product Settlement Agreement, the Debtors ask Court
authority to sell the Prepaid Product free and clear of all liens,
claims, and encumbrances, with such liens, claims, and encumbrances
to attach to the proceeds of such sale in the order and priority in
which they existed as of the Petition Date, and subject to the
terms of any cash collateral orders entered in these Cases, as set
forth in more detail in the Sale Motion.
Each Prepaid Product Settlement Agreement will allow Customers to
obtain expedited return of their Packaged Product and give them
certainty as to the treatment of any claim(s) they may have related
to Additional Inventory. The proposed settlements also resolve the
Customer/Lender dispute as to liens on the Packaged Product,
eliminating a large portion of the disputes the Debtors anticipate
will arise over Prepaid Product. Moreover, entry into a Prepaid
Product Settlement Agreement is not mandatory: a Customer may elect
to have its claims dealt with under the Sale Motion and longer
claims resolution process currently being developed.
A copy of the Prepaid Customer List attached to the Motion is
available for free at:
http://bankrupt.com/misc/Republic_Metals_286_Sales.pdf
About Republic Metals Refining Corp.
Founded in 1980, Republic Metals Refining Corporation and its
affiliates are refiner of precious metals with a primary focus on
gold and silver. They have the capacity to produce approximately
80 million ounces of silver and 350 tons of gold, along with over
55 million pieces of minted products per annum. Suppliers ship
unrefined gold and silver to Republic for refining from all over
The United States and the Western Hemisphere. They provide their
products and services to a diverse base of global mining
corporations, financial institutions and jewelry manufacturers.
Republic Metals Refining, Republic Metals Corporation and Republic
Carbon Company, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case Nos. 18-13359 to 18-13361) on
Nov. 2, 2018. In the petition signed by CRO Scott Avila, Republic
Metals Refining estimated assets of $1 million to $10 million and
liabilities of $100 million to $500 million. The Debtors tapped
Akerman LLP as their legal counsel; Paladin Management Group, LLC
as financial advisor; and Donlin, Recano & Company, Inc. as its
claims and noticing agent.
RESIDENTIAL RESOURCES: Fitch Rates $17.2MM 2018 Bonds 'BB+'
-----------------------------------------------------------
Fitch Ratings has assigned a rating of 'BB+' to approximately $17.2
million series 2018 Allegheny County Industrial Development
Authority lease revenue bonds (Residential Resources, Inc.,
Project), issued on behalf of Residential Resources, Inc. (RRI).
Fitch has also affirmed RRI's Issuer Default Rating (IDR) and
approximately $11.4 million of currently outstanding non-profit
lease revenue bonds, series 2006, at 'BB+'.
The series 2018 lease revenue bonds (Residential Resources, Inc.
Project) will current-refund the outstanding series 2006 bonds,
provide about $6.5 million of new money to refinance outstanding
residential mortgages and pay issuance expenses.
SECURITY
The series 2018 bonds are secured by a pledge of lease revenues on
mortgages of bond-funded properties, and a debt service reserve
(DSR) of about $1.7 million. Allegheny County, PA, guarantees to
replenish any draws on the DSR up to $2.6 million through Sept. 1,
2031 (the scheduled maturity of the series 2018 bonds and the
expiration of the guarantee), which provides additional bondholder
security. Bond covenants for the series 2018 and outstanding bonds
include a 1.25x annual debt service coverage pledge, maintenance of
at least $1 million of liquid assets and maintenance of a debt
service reserve.
ANALYTICAL CONCLUSION
The 'BB+' rating incorporates RRI's weaker revenue defensibility
characteristics and midrange level of operating risk. RRI's
historically stable but potentially vulnerable operating revenues
are largely income related to housing properties leased to various
area human service agencies whose operations are supported by state
and county appropriations. While RRI has some flexibility in
negotiating its property leases (which are typically one to three
years in length), annual rent increases are effectively constrained
by generally flat governmental funding to RRI's client agencies.
The 'BB+' rating also reflects RRI's weak net debt to cash flow
available for debt service (CFADS) given its revenue and operating
profile, and limited liquidity.
KEY RATING DRIVERS
Revenue Defensibility: Weaker
RRI's revenue defensibility is limited by its heavy reliance on
rental income, with limited capacity to increase revenues against
any expense volatility. While RRI has a long history of stable
rental income as a provider of housing to non-profit service
providers for disabled persons, the funding to those providers
comes from the Commonwealth of Pennsylvania and Allegheny County.
That provider funding has been pressured over the last decade, and
overall has been flat or with occasional cuts.
Operating Risk: Midrange
Operating expenses provide moderate operating cost flexibility
given the large proportion of expenses devoted to mortgage and debt
service and RRI's responsibility for maintaining properties. RRI
reports no issues pertaining to maintaining its diverse portfolio
of about 175 housing properties.
Financial Profile: Weaker
RRI's balance sheet resources and net cash flow are weak relative
to its outstanding and pro forma debt, supporting a 'weaker'
assessment of its financial profile. Due to the organization's
business model, operating equity and net income is recycled into
new properties for disabled persons rather than cash reserves.
Outstanding debt, including mortgage notes, consistently exceeds
cash and investments; that leverage is not expected to change, and
limits the rating. The limited guaranty from Allegheny County
provides additional short-term liquidity.
Asymmetric Additive Risk Factors
Asymmetric risk factors are neutral. Outstanding debt is fixed-rate
with rapid amortization, and management is stable with a strong
track-record of producing balanced budgets and managing through
both government funding and real estate cycles. RRI has no legal
limitation on its ability to charge and adjust lease rental rates.
RATING SENSITIVITIES
FINANCIAL CUSHION: The rating should remain stable given RRI's
business profile and Fitch's expectation that debt will continue to
exceed liquid resources (cash and investments). Growth in balance
sheet resources relative to debt would be a favorable credit
consideration.
OPERATING PRESSURES: Fitch expects RRI will continue demonstrating
modest positive operating results, strong expense controls through
periodic government funding and real estate cycles, and debt
service coverage consistently exceeding 1.0x. Significant housing
vacancies could stress revenue and create operating risks and
negatively affect the rating.
CREDIT PROFILE
RRI is a non-profit corporation established in 1988 by
representatives of Allegany County and its provider human service
agencies to acquire and manage housing for disabled adults. RRI
currently owns and maintains 175 properties. These house about 778
residents with various physical and intellectual disabilities
living in and around Allegheny County, PA. RRI primarily leases its
facilities to non-profit social service provider agencies. Only
limited housing is rented directly to tenants with disabilities.
RRI lease agreement terms can vary, but are typically between one
and three years with staggered renewal dates. RRI's key function is
as a property management organization for its niche market; it does
not provide medical or psychiatric care, or daily living support.
Its primary income is rental income derived from facility leases
with various non-profit human service agencies. Total operating
revenue was $5.9 million in fiscal 2018 (June 30 year-end),
remaining down from a peak of $6.2 million in fiscal 2016 due to
several property sales.
There is high customer concentration, as RRI derived approximately
half of its rental revenues from four major service providers.
Management reports that most properties are residential with an
average market value of under $200,000 and are scattered throughout
Allegheny County. Major service providers include Mercy Life Center
Corporation, Partners for Quality, Inc. and Residential Care
Services, Inc. (none are rated by Fitch).
The Commonwealth of Pennsylvania (AA-/Negative) provides direct
funding to RRI's intellectual disability service providers;
Allegheny County (not rated by Fitch) funds mental health-related
services through block-grant revenues. The commonwealth's Negative
Outlook and 'AA-' IDR reflect Fitch's view that budget measures
taken by Pennsylvania in recent years have reduced its financial
resilience. Non-recurring measures and a lack of reserves have been
consistent features of commonwealth budgets, including in the
enacted fiscal 2018 plan, putting Pennsylvania more at risk in the
event of a moderate economic downturn.
Management reports that most provider agencies service both
intellectual disability and mental health clientele populations.
Commonwealth funding to service provider clients reflects overall
state budget constraints. The fiscal 2016 budget was delayed for
nine months, during which RRI and its service agencies operated
effectively. RRI reports that state budgets in fiscal years 2018
and 2019 provide slight funding increases to social service
providers, though the overall funding picture remains constrained.
Revenue Defensibility
RRI's revenue defensibility is weak due to its income dependence on
rent payments from non-profit human service providers. In recent
years commonwealth funding has been fairly flat, consistent with
budget pressures. RRI reports slight increases in human service
funding in fiscal 2019, though increases are targeted to help
waitlisted residents. RRI reports that demand for disabled client
housing is significant, but availability of new housing by human
service providers is historically driven by state funding rather
than demand.
Human service provider facility leases are designed to cover costs,
maintenance and RRI overhead. RRI does not receive direct
commonwealth or county appropriations or funding; rather its human
service providers do. Most facilities are houses or condos in
residential neighborhoods housing one to four clients. RRI
typically has a three-year lease cycle, although some lease
agreements can be shorter or longer. Typical 3-year rental
increases in recent years have been 0%/1%/2% over the life of the
lease. Service agencies must provide RRI with 120 days' notice if
not renewing a lease. RRI typically offers such a facility to other
providers; if there is no demand, the property is sold and related
bonds or mortgages are prepaid. For the fiscal 2019 rental cycle
about one fifth of RRI's properties were up for lease
renewal/renegotiation with greater proportions planned for fiscals
2020 and 2021. Management reports that there have been no major
issues with facility rental renewals.
Operating Risk
RRI has a long history of adjusting operating and lease expenses to
match revenues, generating slim but positive operating results. The
primary expenses for RRI are mortgage and bond interest and direct
property operations (RRI maintains approximately 175 properties).
Leases with various human service agency renters cover expenses.
Fitch views capital planning and management as a neutral credit
factor. RRI has no significant plans for additional debt following
the planned Series 2018 issuance. The organization has a track
record of selling properties when they are not used by a social
service provider. RRI has a policy of only purchasing properties
upon request of a social service provider. The organization makes
no speculative property purchases.
Financial Profile
RRI's rating is limited by its low level of cash and investments
relative to debt. As the real estate provider for many non-profit
human service agencies in the Pittsburgh, PA region, RRI has very
high debt leverage relative to liquidity. At June 30, 2018, RRI had
$11.4 million of series 2006 bonds outstanding and $8.5 million of
mortgage notes, a total of $19.8 million. This is relative to $6.5
million of cash and investments.
Not included in Fitch's liquidity or leverage calculations is a
$2.6 million limited guarantee by Allegheny County (Fitch NR) to
replenish RRI's debt service reserve. The guaranty has never been
used since its establishment in 2001. The guarantee runs through
maturity of the 2006 bonds and will remain under the proposed
series 2018 bonds. Should there be a draw, RRI would be responsible
for reimbursing the county for any guaranty support. This guaranty
only applies to RRI's bond-secured properties, which,
post-issuance, will represent a very modest portion of RI's
indebtedness. This guaranty, which is a GO of the county,
demonstrates continuing commitment to RRI's operations and helps
support Fitch's liquidity evaluation. DS is fairly level and pro
forma MADS following issuance is estimated at a manageable $2.1
million in 2020.
SALLE FAMILY: Has Authorization to Use BHML Cash Collateral
-----------------------------------------------------------
The Hon. George R. Hodges of the United States Bankruptcy Court for
the Western District of North Carolina has entered an order
authorizing Salle Family Land Trust, LLC's use of cash collateral.
The Debtor and Boyd Hard Money Lending, LLC ("BHML") have agreed
and consented to the entry of the Order allowing the limited use of
cash collateral exclusively and only for adequate protection
payments in favor of BHML.
The Debtor is the owner of a residential property located at 137
North Ridge Lane, Newland, NC. The Debtor's primary secured
creditor, BHML, holds a claim for $391,857 secured by a first lien
deed of trust on the aforementioned property owned by the Debtor.
BHML holds a security interest in all rents and profits derived
from the premises, by way of assignments of rents and profits
clause contained in the Deed of Trust.
A full-text copy of the Order is available at
http://bankrupt.com/misc/ncwb18-10214-63.pdf
About Salle Family Land Trust
Salle Family Land Trust, LLC, is engaged in activities related to
real estate. The company is the fee simple owner of three real
properties located in Newland and Burnsville, North Carolina,
valued by the company at $1.03 million in the aggregate.
Salle Family Land Trust filed a voluntary Chapter 11 petition
(Bankr. W.D.N.C. Case No. 18-10214) on May 25, 2018. In the
petition signed by David Salle, managing member, the Debtor
disclosed $1.03 million in total assets and $644,798 in total
liabilities. The case is assigned to Judge George R. Hodges.
Benson T. Pitts, Esq., at Pitts, Hay & Hugenschmidt, P.A., is the
Debtor's counsel.
SEASONS CORPORATE: $10.25M Sale of All Assets to SSNS Approved
--------------------------------------------------------------
Judge Carla E. Craig of the U.S. Bankruptcy Court for the Eastern
District of New York authorized the bidding procedures of Seasons
Corporate, LLC, and the Operating Entities -- Blue Gold Equities
LLC, Central Ave. Market, LLC, Amsterdam Ave. Market, LLC, Wilmot
Road Market, LLC, Seasons Express Inwood, LLC, Seasons Lakewood,
LLC, Seasons Maryland, LLC, Seasons Clifton, LLC, Seasons
Cleveland, LLC, Lawrence Supermarket, LLC, Upper West Side
Supermarket, LLC; and their Amended Asset Purchase Agreement, dated
Oct. 15, 2018, with SSNS Express, LLC, in connection with the sale
of substantially all assets for a cash purchase price of $10.25
million plus assumption of the Cure Costs under the Transferred
Contracts not to exceed $3.45 million.
The Sale Hearing was held on Dec. 5, 2018.
The sale is free and clear of all Claims and Encumbrances.
The Acquired Assets do not include the real property owned by
Seasons Property Management LLC, nor, any avoidance claims or other
claims belonging to the Debtors, their estates or asserted by the
Committee.
The Schedule 1.1(a) to the Amended APA identifies all the Contracts
and Leases the New Purchaser wishes to be assumed by the Debtors
and assigned by the Debtors to the New Purchaser. The Debtors have
exercised their reasonable business judgment, and are authorized
and directed, to assume and assign in accordance with the Amended
APA each of the Transferred Contracts free and clear of all liens,
Claims and Encumbrances, and other interests of any kind or nature
whatsoever.
Except as otherwise provided in the Order, the Assumed Cure Costs
and the Excluded Cure Costs are the sole amounts necessary to be
paid upon assumption of the Transferred Contracts.
At the Closing, the Debtors and the New Purchaser will pay these
amounts to the non-Debtor counterparties to the Transferred
Contracts:
a. Third Nassau Corp:
(I) Payments by the Debtors (Excluded Cure Costs) - (i)
rent arrears through Nov. 30, 2018 of $235,578, (ii) an additional
security deposit of $17,932, and (iii) payment to Third Nassau
Corp. of $20,000 towards its attorneys' fees, and (iv) 2018-2019
real estate tax payment in the amount of $19,497
(II) Payments by the New Purchaser - (i) an additional
security deposit in the amount of $67,932 and (ii) 2018-2019 real
estate tax payment in the amount of $19,497
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - December's rent of
$26,175
b. Scarsdale Shopping Center Associates, LLC:
(I) Payments by the Debtors (Excluded Cure Costs) -
$400,000, including security deposit of $125,381, subject to the
terms and conditions of the subject Lease
(II) Payments by the New Purchaser - an additional
security deposit in the amount of $188,071
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - December's rent of
$62,366
c. Main Street Properties DM, LLC and Main Properties AM,
LLC:
(I) Payments by the Debtors (Excluded Cure Costs) -
$232,235
(II) Payments by the New Purchaser - (i) an additional
security deposit in the amount of $78,132 and (ii) $63,539 on
account of real estate taxes
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - December's rent of
$26,044
d. Albert Henek:
(I) Payments by the Debtors (Excluded Cure Costs) -
$25,163
(II) Payments by the New Purchaser - $0
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - December's rent of
$10,205
e. 319 Cedarbridge, LLC:
(I) Payments by the Debtors (Excluded Cure Costs) -
$118,383
(II) Payments by the New Purchaser - $0
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - December's rent of
$42,565
f. Vincent Sarnelli:
(I) Payments by the Debtors (Excluded Cure Costs) -
$1,911
(II) Payments by the New Purchaser - $0
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - December's rent of
$3,473
g. Crestmark Equipment Finance, Inc.:
(I) Payments by the Debtors (Excluded Cure Costs) -
$714,132
(II) Payments by the New Purchaser - $735,868
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - None
h. Hanmi Bank:
(I) Payments by the Debtors (Excluded Cure Costs) -
$130,000
(II) Payments by the New Purchaser - $0
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - None
i. Main Ingredient South, Inc.:
(I) Payments by the Debtors (Excluded Cure Costs) -
$69,655
(II) Payments by the New Purchaser - $0
(III) Payments to be Apportioned and Prorated at Closing
between the Debtors and the New Purchaser - None
In conjunction with the Amended Sale Transaction, the New Purchaser
entered into a Binding Term Sheet on Dec. 4, 2018 with Crestmark
Equipment Finance, Inc. whereby the New Purchaser and the Debtors
will collectively pay a total of $1.45 million on or before the
Closing directly to Crestmark in exchange for, among other
consideration: (i) a release of any and all pledges, claims, liens,
charges, encumbrances restrictions or security interests of any
kind or nature whatsoever in favor of Crestmark with respect to the
equipment subject to that certain Equipment Finance Agreement (No.
160536-000) dated Nov. 8, 2016 between Crestmark and Wilmot Road
Market, LLC; (ii) a waiver and release of any and all claims of
Crestmark in respect of the Equipment Finance Agreement against the
New Purchaser, the Debtors or any related parties in the Chapter 11
Cases; and (iii) waiver of any objections to the Amended Sale
Transaction to the New Purchaser. The Crestmark Term Sheet and the
Crestmark Payment is approved, and Crestmark's receipt of direct
and full payment of the Crestmark Payment will constitute full
satisfaction of all liens and claims of Crestmark against the New
Purchaser, the Debtors and the Debtors' estates arising out of or
related to the Equipment Finance Agreement.
On the Closing Date, the Debtors will present written confirmation,
in form and substance acceptable to Scarsdale Landlord, of proof of
payment of the amount necessary to discharge the mechanics lien
filed by Robert S. Spano Plumbing and Heating, Inc. on Dec. 6, 2018
as and against 1102-1110 Wilmot Road, Scarsdale, New York . The
counsel to the Debtors will hold in escrow proceeds from the
Amended Sale Transaction in Zeichner Ellman & Krause's firm escrow
account, as a separate, interest bearing escrow subaccount, in an
amount sufficient to pay any Person or Entity that may seek to hold
or assert a mechanics lien against the Scarsdale Property for any
and all work performed by or on behalf of the Debtors relating to
the Scarsdale Property. On the Closing Date, the Mechanics Lien
Escrow will be funded in an amount of not less than $900,000 and
will remain in escrow for a period of eight (8) months from the
Closing Date or until the date upon which all mechanics lien claims
against the Scarsdale Property are satisfied, whichever is longer.
The Debtors will escrow the sum of $4 million from the Amended Sale
Transaction proceeds in Klestadt Winters Jureller Southard &
Stevens, LLP's firm escrow account, as a separate, interest bearing
escrow subaccount, held at Signature Bank pending resolution of the
Committee's Adversary Proceeding. The Escrowed Funds will not be
released without further Order of the Court.
The Debtors will assign to the New Purchaser any and all Causes of
Action (including, without limitation, Avoidance Actions) that the
Debtors may hold against any third party vendors and
concessionaires in respect of the Acquired Assets, any Assumed
Liabilities, and/or the Business.
The automatic stay of section 362(a) of the Bankruptcy Code will
not apply to and otherwise will not prevent the exercise or
performance by any party of its rights or obligations under the
Amended APA, including, without limitation, with respect to any
cash held in escrow pursuant to the provisions thereof.
The Sale Order will take effect immediately and will not be stayed
pursuant to Bankruptcy Rules 6004(h), 6006(d), 7062, or otherwise.
Any party objecting to the Sale Order must exercise diligence in
filing an appeal and obtaining a stay prior to the Closing Date or
risk its appeal being foreclosed as moot.
A copy of the Amended Agreement attached to the Order is available
for free at:
http://bankrupt.com/misc/Seasons_Corporate_246_Order.pdf
About Blue Gold
Launched in 2010, Blue Gold owns and operates nine retail kosher
food stores under the name of "Seasons" in New York , New Jersey,
Ohio and Maryland.
On Sept. 16, 2018, Blue Gold Equities LLC and 11 of its
subsidiaries filed voluntary petitions seeking relief under the
provisions of Chapter 11 of the U.S. Bankruptcy Code (Bankr.
S.D.N.Y. Lead Case No. 18-45280). Blue Gold disclosed $31 million
in total assets and $42 million in total liabilities.
The Hon. Nancy Hershey Lord is the case judge.
ZEICHNER ELLMAN & KRAUSE LLP, led by Nathan Schwed, Peter Janovsky,
and Robert Guttmann, serve as the Debtors' counsel. GETZLER
HENRICH & ASSOCIATES, LLC, is the restructuring advisor. OMNI
MANAGEMENT GROUP, INC., is the claims and noticing agent.
SENIOR CARE: Seeks to Hire Polsinelli PC as Counsel
---------------------------------------------------
Senior Care Centers, LLC, and its debtor-affiliates seek authority
from the U.S. Bankruptcy Court for the Northern District of Texas
to employ Polsinelli PC, as counsel to the Debtors.
Senior Care requires Polsinelli PC to:
a. take all necessary action to protect and preserve the
estates of the Debtors, including the prosecution of
actions on the Debtors' behalf, the defense of any actions
commenced against the Debtors, the negotiation of disputes
in which the Debtors are involved, and the preparation of
objections to claims filed against the Debtors' estates;
b. provide legal advice with respect to the Debtors' powers
and duties as debtors in possession in the continued
operation of their business;
c. prepare on behalf of the Debtors, as debtors in possession,
necessary motions, applications, answers, orders, reports,
and other legal papers in connection with the
administration of the Debtors' estates;
d. appear in court and protect the interests of the Debtors
before this Court;
e. assist with any disposition of the Debtors' assets, by sale
or otherwise;
f. take all necessary or appropriate actions in connection
with any plan of reorganization and related disclosure
statement and all related documents, and such further
actions as may be required in connection with the
administration of the Debtors' estates;
g. review all pleadings filed in the Chapter 11 Cases; and
h. perform all other legal services in connection with the
Chapter 11 Cases as may reasonably be required.
Polsinelli PC will be paid at these hourly rates:
Attorneys $450 to $815
Associates $250 to $450
Paraprofessionals $200 to $250
In the 12 months preceding the Petition Date, Polsinelli PC
received the amount of $1,785,759.
In June 2018, the Debtors paid Polsinelli PC an initial retainer of
$100,000. Shortly before the Petition Date, Polsinelli PC received
an additional retainer of $500,000. All of Polsinelli PC's fees
and expenses incurred prior to the Petition Date were paid in full
and Polsinelli PC has remaining amount of $674,190 in trust as a
Retainer.
Polsinelli PC will also be reimbursed for reasonable out-of-pocket
expenses incurred.
In accordance with Appendix B-Guidelines for Reviewing Applications
for Compensation and Reimbursement of Expenses Filed under 11
U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, the
following is provided in response to the request for additional
information:
Question: Did you agree to any variations from, or
alternatives to, your standard or customary billing
arrangements for this engagement?
Response: No.
Question: Do any of the professionals included in this
engagement vary their rate based on the geographic
location of the bankruptcy case?
Response: No.
Question: If you represented the client in the 12 months
prepetition, disclose your billing rates and
material financial terms for the prepetition
engagement, including any adjustments during the 12
months prepetition. If your billing rates and
material financial terms have changed postpetition,
explain the difference and the reasons for the
difference.
Response: Prior to the Petition Date, Polsinelli represented
the Debtors in its restructuring efforts.
Polsinelli PC charged its standard hourly rates,
which are substantially similar to the billing
rates and financial terms that Polsinelli PC
intends to charge for post-petition work.
Question: Has your client approved your prospective budget
and staffing plan, and, if so for what budget
period?
Response: In connection with the cash collateral financing
budget, the Debtors have provided an estimated
budget and staffing plan, recognizing that in the
course of large chapter 11 cases, unforeseeable
issues resulting in unanticipated fees and expenses
may arise that will need to be addressed by the
Debtors and Polsinelli PC.
Jeremy R. Johnson, partner of Polsinelli PC, assured the Court that
the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtors and their estates.
Polsinelli PC can be reached at:
Jeremy R. Johnson, Esq.
POLSINELLI PC
600 3rd Avenue, 42nd Floor
New York, NY 10016
Tel: (212) 684-0199
Fax: (212) 684-0197
E-mail: jeremy.johnson@polsinelli.com
- and -
Trey A. Monsour, Esq.
POLSINELLI PC
2950 N. Harwood, Suite 2100
Dallas, TX 75201
Tel: (214) 397-0030
Fax: (214) 397-0033
E-mail: tmonsour@polsinelli.com
About Senior Care Centers
Senior Care Centers, LLC -- https://senior-care-centers.com/ -- is
a Dallas-based, skilled nursing and long-term care industry leader
in Texas and Louisiana. Senior Care Centers operates and manages
more than 100 skilled nursing and assisted/independent living
communities in the states of Texas and Louisiana.
On Dec. 4, 2018, Senior Care Centers and 120 of its subsidiaries
filed voluntary Chapter 11 petitions (Bankr. N.D. Tex. Lead Case
No. 18-33967).
The Debtors tapped POLSINELLI PC as bankruptcy counsel; Hunton
Andrews Kutrh LLP as conflicts counsel; Sitrik and Company as
communications consultant; and Omni Management Group, Inc. as
claims, noticing, and administrative agent.
SOAPTREE HOLDINGS: Seeks to Hire RPD Analytics as Appraiser
-----------------------------------------------------------
Soaptree Holdings LLC seeks authority from the U.S. Bankruptcy
Court for the District of Nevada to employ RPD Analytics, LLC, as
appraiser and valuation expert to the Debtor.
Soaptree Holdings requires RPD Analytics to prepare an appraisal
report for Debtor's Properties located at 3265 Ennis Ct., Las
Vegas, Nevada 89121; 2937 Morning Dew St., Las Vegas, Nevada 89117;
1816 Scenic Sunrise Dr., Las Vegas, Nevada 89117; 9209 Buckhaven
Dr., Las Vegas, Nevada 89117; and 3205 Bishop Pine St., Las Vegas,
Nevada 89129.
RPD Analytics will charge a flat fee of $2,700 to prepare an
appraisal report for all five Properties. For additional services,
the RPD Analytics will charge $450 per hour for testimony and $400
per hour for consultation and other services.
Michael L. Brunson, managing partner of RPD Analytics, LLC, assured
the Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtor and its estates.
RPD Analytics can be reached at:
Michael L. Brunson
RPD ANALYTICS, LLC
9550 S. Eastern Avenue, Suite 253
Las Vegas, NV 89123
Tel: (702) 641-5657
About Soaptree Holdings
Soaptree Holdings LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Nev. Case No. 18-16378) on Oct. 24,
2018. Judge August B. Landis presides over the case. The Debtor
tapped Andersen Law Firm, Ltd., as its legal counsel.
SOUTHCROSS ENERGY: S&P Lowers ICR to 'CCC-', Outlook Negative
-------------------------------------------------------------
U.S. midstream energy partnership Southcross Energy Partners L.P.
continues to face significant challenges to its business, and has
limited near-term liquidity and financial flexibility through
first-quarter 2019. Absent a substantial equity infusion from its
sponsors or a third party, S&P expects Southcross will need to seek
covenant waivers or amend its credit facilities with its lending
group in order to avoid a default by March 31, 2019.
S&P Global Ratings lowered its issuer credit rating to 'CCC-' from
'CCC'. At the same time, S&P lowered its issue-level rating on the
partnership's senior secured debt to 'CCC-'. The recovery rating
remains '3', indicating a meaningful recovery (50%-70%; rounded
estimate: 55%) in the event of a payment default.
The downgrade reflects the heightened risk that Southcross Energy
Partners L.P. could be in default of its debt obligations by March
31, 2019, absent a meaningfully favorable change in the
partnership's circumstances. At that date, the partnership's more
restrictive financial covenant--maximum total debt to EBITDA of 5x
and senior secured debt to EBITDA of 3.5x--will be reinstated.
Southcross had a total leverage ratio of 8.6x as of Sept. 30, 2018.
The partnership currently has about $523 million of total debt
outstanding, consisting of $83 million of senior secured revolver
borrowings due in August 2019, about $16 million of unsecured notes
due November 2019 (unrated), and a $430 million senior secured term
loan due August 2021.
S&P said, "The negative outlook on Southcross reflects our belief
that the risk of a default, distressed exchange, or other debt
restructuring is highly likely by the end of first-quarter 2019,
absent significantly favorable changes in the partnership's
circumstances.
"We could lower the rating to 'CC' if we believed a default was
imminent, or if the partnership announced that it would miss its
next debt payment, file for bankruptcy, or undertake an exchange
offer that we classify as distressed.
"It is unlikely that we will raise our rating on Southcross given
its limited liquidity and upcoming debt maturities. However, we
could consider a higher rating if we no longer believed that a
default or debt restructuring is likely by March 31, 2019."
ST. JUDE NURSING: PCO Files 2nd Report
--------------------------------------
Deborah L. Fish, the Patient Care Ombudsman appointed for St. Jude
Nursing Center, Inc., filed a second report with the U.S.
Bankruptcy Court for the Eastern District of Michigan.
The PCO noted that the Debtor has continued the same quality of
care post-petition as it did prepetition.
During visit at the facility, the PCO reported that the floors and
the residents' rooms were clean. The PCO noted that the residents
are supervised when outdoors and smoking privileges are given
outside four times a day.
According to the PCO, the Debtor reported that it has maintained
its relationship with its suppliers and there have been no
interruptions in service, nor any changes in medical supplies. The
Debtor has contacted a new transportation company and is in the
process of executing a contract. In the meantime, the Debtor used a
temporary service and most recently the new company has begun the
service.
A copy of the PCO's Second Report dated December 12, 2018, is
available at:
http://bankrupt.com/misc/mieb18-54906-70.pdf
About St. Jude Nursing
St. Jude Nursing Center is a privately owned and licensed long-term
skilled nursing facility located at 34350 Ann Arbor Trail, Livonia,
Michigan 48150. The Facility consists of 64 licensed beds, located
within the Debtor-owned facility. The Facility offers services
such as skilled nursing care, hospice care, Alzheimer's and
dementia patient care, physical rehabilitation, tracheal and
enteral services, wound care, and short-term respite care. The
Company previously sought bankruptcy protection on Feb. 18, 2016
(Bankr. E.D. Mich. Case No. 16-42116) and Feb. 22, 2012 (Bankr.
E.D. Mich. Case No. 12-43956).
St. Jude Nursing Center, Inc. filed a Chapter 11 petition (Bankr.
E.D. Mich. Case No. 18-54906) on Nov. 2, 2018, and is represented
by Jeffrey S. Grasl, Esq., in Farmington Hills, Michigan. In the
petition signed by Bradley Mali, president, the Debtor estimated
$500,000 to $1 million in assets and $1 million to $10 million in
liabilities as of the bankruptcy filing.
STARION ENERGY: Seeks to Hire Ordinary Course Professionals
-----------------------------------------------------------
Starion Energy Inc., and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
ordinary course professionals to the Debtors.
Starion Energy has tapped these ordinary course professionals:
Ordinary Course Professional Services
---------------------------- --------
Retail Energy Supply Tax Services
Association
Belcher Fitzgerald LLP General/Corporate
Walden Macht & Haran LLP General/Corporate
Eckert Seamans Cherin & MA: AG/Regulatory
Mellott LLC PA/DC/MD/DE:
General/Corporate,
Insurance Coverage,
Trademark
Gordon & Rees State/Federal Marketing
Law
Robinson & Cole LLP CT/RI/NY Regulatory
Bevan, Mosca & Giuditta, P.C. NJ Regulatory
Law Office of Gerard T. Fox IL Regulatory
DNB Government Relations CT Lobbyist
Vorys, Sater, Seymour and
Pease LLP OH Regulatory
To the best of the Debtors' knowledge the firms are a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code and does not represent any interest adverse to
the Debtors and their/its estates.
About Starion Energy
Founded in 2009, Starion Energy -- https://www.starionenergy.com/
-- is a competitive electric supplier that markets and sells
electricity to retail customers. Starion participates in certain
"deregulated" markets -- markets in which the state has allowed
third-party energy providers to market and sell electricity supply
as an alternative to the electric supply procured and provided by
the customers' utility. It has operations in Connecticut,
Delaware, District of Columbia, Illinois, Massachusetts, Maryland,
New Jersey, New York, Ohio, and Pennsylvania. Based in Middlebury,
Connecticut, Starion Energy is a member of the Retail Energy Supply
Association (RESA).
Starion Energy and its affiliates, Starion Energy PA, Inc., and
Starion Energy NY, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 18-12608) on Nov. 14,
2018. At the time of the filing, Starion Energy disclosed
$26,888,675 in assets and $6,956,141 in liabilities.
The Hon. Mary F. Walrath is the case judge.
Gellert Scali Busenkell & Brown, LLC, is the Debtors' legal
counsel.
STRATOS ENTERPRISES: Selling West Monroe Property for $450K
-----------------------------------------------------------
Stratos Enterprises, Inc., doing business as Boomers School Supply,
asks the U.S. Bankruptcy Court for the Western District of
Louisiana to authorize the sale of the real property located at 132
Well Road, West Monroe, Louisiana for $450,000.
A hearing on the Motion is set for Jan. 10, 2019 at 10:45 a.m.
Objections, if any, must be filed at least seven days in advance of
the Motion hearing date.
The property is valued at an estimated $509,000. North Louisiana
Bidco, LLC holds the mortgage against the property.
The Debtor has received an offer to purchase the property for the
sales price of $450,000. Despite the offer not being sufficient to
pay the mortgage held against the property in full, the lienholder,
Bidco has agreed to accept the offer and release the lien on
property under the conditions that the Buyer pays all closing costs
and that Bidco receives all sales proceeds. Bidco will pay the
property taxes due on the property from the sale proceeds.
After due notice and hearing to all interested parties, the Debtor
asks that it would be given permission to sell the property and
turn over all sale proceeds to Bidco.
About Stratos Enterprises
Stratos Enterprises, Inc., doing business as Boomers School Supply
-- myboomers.net -- located at 2009 Martin Luther King, Jr., Drive
Monroe, LA 71202, is a locally owned and operated company that
operates a store that sells fireworks, school supplies and
inflatable slides.
Stratos Enterprises, Inc., sought Chapter 11 protection (Bankr.
W.D. La. Case No. 18-31276) on Aug. 11, 2018. In the petition
signed by Farra Shaw, president, the Debtor estimated assets in the
range of $500,000 to $1 million and $1 million to $10 million in
debt. Judge Jeffrey P. Norman is the case judge. The Debtor
tapped James W. Spivey, II, Esq., at James W. Spivey II, as
counsel.
SUPERIOR HOME: PCO Files 3rd Report
-----------------------------------
Dr. Thomas A. Mackey, the Patient Care Ombudsman appointed to
Superior Home Health of San Antonio, LLC, files a third report with
the U.S. Bankruptcy Court for the Western District of Texas.
Overall, the PCO reported that the Debtor continues to deliver
quality and safety patient care in a manner equal to/better than
what was delivered prior to the PCO's first visit. The PCO also
reported that there is no apparent decrease in quality, safety or
types of services from what existed prior to the filing.
As mentioned in the previous PCO report, the Debtor's licenses from
the Texas Department of Aging and Disability Services (DADS) for
all Facilities are still current. DADS was scheduled to visit for
re-certification back in August, 2018 but delayed all statewide
re-certifications until computer issues at the State office are
resolved. DADS will reschedule a visit in the near future.
According to the Report, the Debtor continues to improve quality of
patient care with a “Drive for 5” campaign directed at
improving the CMS Quality of Patient Care Star Ratings.
Meanwhile, the key indicators of quality and safety (medication
error avoidance, fall prevention, hospital re-admission reduction,
nurses work environment outcomes based quality improvement
programs, and high patient satisfaction scores) are still being
addressed by key staff members.
Since May 2018 the number of active patients noticeably increased
from 471 to 701, while the total number of employees increased from
106 to 119 since July 2018.
A copy of the PCO's Third Report is available at:
http://bankrupt.com/misc/txwb18-50600-163.pdf
About Superior Home
Superior Home Health -- http://superiorforyou.com-- is a provider
of home health and hospice care services with locations in Texas
and Nevada. The Debtors are affiliates of Big Guns Petroleum, Inc.,
which sought bankruptcy protection on March 13, 2018 (Bankr. W.D.
Tex. Case No. 18-50569).
Superior Home Health Services, LLC, and five affiliates filed
voluntary Chapter 11 petitions (Bankr. W.D. Tex. Case No. 18-50597)
on March 16, 2018. The case is assigned to Judge Ronald B. King.
The Debtors are represented by Ronald J. Smeberg, Esq., at The
Smeberg Law Firm, PLLC, in San Antonio, Texas.
At the time of filing, the Debtors had estimated assets of $100,000
to $500,000 and estimated liabilities of $500,000 to $1 million.
The petition was signed by Belinda Juarez, president.
Dr. Thomas A. Mackey was appointed as the Patient Care Ombudsman
(PCO) for Superior Home Health of San Antonio, LLC.
SYNERGY PHARMACEUTICALS: BH Buying Assets for $185 Million
----------------------------------------------------------
Synergy Pharmaceuticals, Inc., and Synergy Advanced
Pharmaceuticals, Inc. ask the U.S. Bankruptcy Court for the
Southern District of New York to authorize the bidding procedures
in connection with the sale of assets to Bausch Health Companies,
Inc. ("BH") and its wholly-owned subsidiary Bausch Health Ireland
Ltd. for a total of (i) $185 million in cash, minus the Cure Costs
Deduction, minus the GTN Adjustment Amount, net of any Deposit
Funds paid to the Parent at Closing; (ii) up to $15 million in cash
to pay the severance obligations of each employee of the Sellers
who are eligible to receive severance under the terms of the
severance policy and in accordance with the Stalking Horse
Agreement; and (iii) assumption of liabilities, subject to
overbid.
Synergy ran a strategic review process to explore potential
strategic alternatives to maximize value, including a sale,
restructuring, or other transaction. That review process commenced
in May 2018. Synergy directed Centerview Partners, LLC to conduct
buyer outreach. The 2018 Strategic Process followed an extensive
buyer outreach process conducted by Centerview over the prior
three-year period beginning with Synergy's engagement of Centerview
in 2015. Over the course of the 2018 Strategic Review Process,
Synergy and Centerview held in-depth conversations with various
potential interested parties, including BH.
On Feb. 27, 2018, the Company entered into a definitive licensing,
development and commercialization agreement with Cipher
Pharmaceuticals, Inc. under which Cipher was granted the exclusive
right to develop, market, distribute, and sell TRULANCE in Canada.
On Aug. 6, 2018, the Company entered into a definitive licensing,
development and commercialization agreement with Luoxin
Pharmaceutical Group Co., Ltd., Shandong granting Luoxin exclusive
rights to develop and commercialize TRULANCE in mainland China,
Hong Kong, and Macau. However, as of Oct. 25, 2018, the Company
was unable to execute any other partnering or in-licensing
transaction, and only BH had submitted a non-binding offer subject
to due diligence to acquire the Company. The non-binding BH offer
contemplated an out-of-court sale, but valued Synergy significantly
below the Company's market capitalization. After receiving the
non-binding BH offer, the Company engaged actively with BH in
pursuit of facilitating a value-maximizing transaction.
Ultimately, the Company, with its legal and financial advisors,
determined that the alternative financing that was offered did not
align with the Company's strategic objectives, was unlikely to
provide greater value than the Stalking Horse Agreement, and was
not reasonably executable. In addition, the Company's outreach to
other potential buyers did not result in further written offers.
The Debtors subsequently continued negotiations with BH. The
parties have entered into the Asset Purchase Agreement, dated as of
Dec. 12, 2018, which contemplates the sale of the Acquired Assets
to the Stalking Horse Bidder. The Acquired Assets include, but are
not limited to, certain contracts of the Sellers, inventory, other
equipment and personal property used or held in the conduct of
business, and certain intellectual property of the Sellers.
The Debtors believe that the transaction negotiated with the
Stalking Horse Bidder is fair, reasonable, and represents the
highest and best offer available to the Debtors at this time,
subject to higher and better offers received during the marketing
process contemplated by the Bidding Procedures. The transaction
negotiated with the Stalking Horse Bidder is the culmination of a
comprehensive marketing process that transpired over a multi-year
period.
The Sellers ask approval of the Bidding Procedures. The Bidding
Procedures are designed to maximize value for the Debtors' estates,
while ensuring an orderly sale process consistent with the timeline
available to the Debtors under the Stalking Horse Agreement.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: Feb. 9, 2019 at 4:00 (EST)
b. Minimum Bid Amount: A Bid must propose a minimum purchase
price, including any assumption of liabilities, that in the
Debtors' reasonable business judgment has a value greater than the
sum of (i) the Purchase Price, (ii) the Break-Up Fee, (iii) the
Expense Reimbursement Amount, (iv) the Assumed Liabilities, and (v)
a minimum Bid increment of $2 million.
c. Deposit: 10% of the Purchase Price
d. Auction: If the Sellers receive one or more Qualified Bids,
in addition to the Stalking Horse Agreement, the Sellers will
conduct the Auction of the Acquired Assets. If the Auction is
held, it will take place on Feb. 12, 2019 at 10:00 a.m. (EST) at
the offices of Skadden, Arps, Slate, Meagher & Flom LLP, Four Times
Square, New York, NY 10036.
e. Bid Increments: $1 million
f. Sale Hearing: Feb. 15, 2019
g. Bid Protections: A Break-Up Fee of $7 million, plus up to
$1.95 million in reasonable and documented out-of-pocket costs,
fees, and expenses
Within three business days after the entry of the Bidding
Procedures Order, the Debtors will cause the Sale Notice upon all
Sale Notice Parties. The Debtors are asking approval of their
assumption and assignment of executory contracts in connection with
the Sale. No less than 21 calendar days prior to the Sale
Objection Deadline, the Debtors will serve the Contract Assumption
Notice. The Cure Objection Deadline is 14 days after service of
the Contract Assumption Notice.
The salient terms of the Stalking Horse APA are:
a. Sellers: Synergy Pharmaceuticals Inc. and its wholly-owned
subsidiary, Synergy Advanced Pharmaceuticals, Inc.
b. Acquired Assets: The Acquired Assets consist of the
Sellers' right, title and interest in: other than as set forth in
Section 1.2(k) of the APA.
c. Assumed Liabilities: The Assumed Liabilities consist of
certain liabilities and obligations arising from the ownership,
possession or use of the Acquired Assets and the operation of the
Business.
d. Purchase Price and Sale of Acquired Assets: In
consideration for the Acquired Assets, the Purchaser shall, in
addition to the assumption of the Assumed Liabilities by the
Purchaser, pay to the Sellers the Purchase Price. The Purchase
Price is comprised of (i) $185 million in cash, minus the Cure
Costs Deduction, minus the GTN Adjustment Amount, net of any
Deposit Funds paid to the Parent at Closing and (ii) the Severance
Consideration.
The proposed Bidding Procedures Order, the proposed Sale Order, and
the Stalking Horse Agreement contain these items that may be
considered Extraordinary Provisions under the Sale Guidelines:
a. The Purchaser has not entered into any agreements with
management or key employees regarding compensation or future
employment.
b. The Purchaser will pay to the Parent on behalf of the
Sellers the Severance Consideration equal to the lesser of (x)
$15,000,000 and (y) the amount of severance obligations plus any
employer portion of payroll taxes due in respect of such
obligations and benefits. All of the Company's current full-time
employees, including the Company’s CEO and CFO are eligible to
participate in the Company's severance plan.
c. The Stalking Horse Agreement restricts the solicitation of
alternative bids until entry of the Bidding Procedures Order.
d. As is set forth in the APA, the Sale may be terminated in
certain circumstances, including if (i) the Purchaser is the
Successful Bidder and the Sale Hearing has not been commenced on or
prior to Feb. 15, 2019.
e. The parties agree to allocate for Tax purposes, the
Purchase Price and any other amounts treated as additional
consideration for Tax purposes among the Acquired Assets in
accordance with the procedures and, to the extent applicable, in
accordance with Section 1060 of the Code, the Treasury Regulations
promulgated thereunder. The parties agree that no more than $45
million will be allocated to the Non-US Asset Allocation Within 90
days after the Closing Date, BH will deliver to Parent the
Purchaser's Allocation. No later than 30 days following the
delivery of the Purchaser's Allocation, Parent may deliver to BH
the Sellers’ Allocation Notice. If Parent timely delivers to BH
a Sellers' Allocation Notice, Parent and BH shall, during the 20
days following such delivery, use commercially reasonable efforts
to reach agreement on the disputed items or amounts. The
Allocation will be final and binding on the parties.
f. The Acquired Assets will be transferred free and clear of
all encumbrances.
g. The Debtors ask relief from the 14-day stay imposed by
Bankruptcy Rule 6004(h).
A copy of the Bidding Procedures and the Stalking Horse APA
attached to the Motion is available for free at:
http://bankrupt.com/misc/Synergy_Pharmaceuticals_17_Sales.pdf
The relief that the Debtors ask is necessary for the Debtors to
operate without interruption and to preserve value for their
estates. Accordingly, they respectfully ask that the Court waives
the 14-day stay imposed by Bankruptcy Rule 6004(h), as the exigent
nature of the relief sought justifies immediate relief.
The Purchasers:
BAUSCH HEALTH COMPANIES, INC.
BAUSCH HEALTH IRELAND LTD.
400 Somerset Corporate Boulevard
Bridgewater, NJ 08807
Facsimile: (908) 927-1568
(949) 271-3796
Attn: Joseph C. Papa
Christina M. Ackermann
E-mail: joseph.papa@bauschhealth.com
christina.ackermann@bauschhealth.com
The Purchasers are represented by:
Igor Kirman, Esq.
Richard G. Mason, Esq.
Mark F. Veblen, Esq.
Michael S. Benn, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, NY 10019
Facsimile: (212) 403-2
E-mail: IKirman@wlrk.com
RGMason@wlrk.com
MFVeblen@wlrk.com
MSBenn@wlrk.com
About Synergy Pharmaceuticals
Synergy (NASDAQ: SGYP) -- http://www.synergypharma.com/-- is a
biopharmaceutical company focused on the development and
commercialization of novel gastrointestinal (GI) therapies. The
company has pioneered discovery, research and development efforts
around analogs of uroguanylin, a naturally occurring human GI
peptide, for the treatment of GI diseases and disorders. Synergy's
proprietary GI platform includes one commercial product
TRULANCE(R)
(plecanatide) and a second product candidate - dolcanatide.
T BAR W PROPERTIES: Hires Michael E. Gazette as Attorney
--------------------------------------------------------
T Bar W Properties, Inc., seeks authority from the U.S. Bankruptcy
Court for the Eastern District of Texas to employ the Law Offices
of Michael E. Gazette, as attorney to the Debtor.
T Bar W Properties requires Michael E. Gazette to:
-- appear for, prosecute, and defend in the bankruptcy
proceeding;
-- advise the Debtor in the preparation and filing of the
petition, schedules, and statement of financial affairs,
the preparation and filing of a disclosure statement and
plan of reorganization, negotiation with creditors, review
of executory contracts, review of claims, the response to
and appearance at hearings on contested matters; and
-- provide legal services necessary in the bankruptcy
proceedings.
Michael E. Gazette will be paid at these hourly rates:
Attorneys $320
Paraprofessionals $50
Michael E. Gazette will be paid a retainer in the amount of
$25,000.
Michael E. Gazette will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Michael E. Gazette, partner of the Law Offices of Michael E.
Gazette, assured the Court that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and does not represent any interest adverse to the Debtor and
its estates.
Michael E. Gazette can be reached at:
Michael E. Gazette, Esq.
LAW OFFICES OF MICHAEL E. GAZETTE
100 East Ferguson Street, Suite 1000
Tyler, TX 75702-5706
Tel: (903) 596-9911
Fax: (903) 596-9922
E-mail: megazette@suddenlinkmail.com
About T Bar W Properties
T Bar W Properties, Inc., is a privately held company in Tyler,
Texas, in the cattle ranching and farming business. T Bar W
Properties, based in Tyler, TX, filed a Chapter 11 petition (Bankr.
D. Tex. Case No. 18-60770) on Dec. 3, 2018. In the petition signed
by John H. Wampler, president, the Debtor estimated $1 million to
$10 million in assets and liabilities. Michael E. Gazette, Esq.,
at the Law Offices of Michael E. Gazette, serves as bankruptcy
counsel.
TECHNOLOGY SOLUTIONS: Seeks to Hire Stern Kory as Accountant
------------------------------------------------------------
Technology Solutions & Services, Inc., seeks authority from the
U.S. Bankruptcy Court for the Central District of California to
employ Stern Kory Sreden and Morgan, An Accountancy Corporation, as
accountant to the Debtor.
The Debtor received a notice dated November 14, 2018 from the
California Franchise Tax Board advising that its tax returns for
the years 2015, 2016 and 2017 have been assigned for an audit. The
Debtor requires Stern Kory to represent the Debtor in the audit.
Stern Kory will be paid at the hourly rate of $290-$375.
During the one year prior to the Petition Date, the Firm received
payment of fees and expenses from the Debtor in the total amount of
$17,050.
Stern Kory will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Douglas Ridnor, partner of Stern Kory Sreden and Morgan, An
Accountancy Corporation, assured the Court that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code and does not represent any interest adverse to
the Debtor and its estates.
Stern Kory can be reached at:
Douglas Ridnor
Stern Kory Sreden and Morgan
An Accountancy Corporation
24961 The Old Road, 2nd Floor
Stevenson Ranch, CA 91381
Tel: (661) 286-1040
About Technology Solutions & Services
Technology Solutions & Services, Inc. -- http://www.tssius.com/--
is a full service reverse logistics company. It offers a wide
variety of asset recovery solutions specific to mobile, IT and
consumer electronics industries. Technology Solutions team has over
20 years of experience dealing with high volume product
refurbishment; processing & sorting of customer return merchandise;
failure analysis, data collection & reporting; recalls, reworks &
re-kitting; EOL disposition & management; customized IT solutions;
scrap management & recycling; warehousing & fulfillment; discreet
remarketing; excess inventory management; product de-branding,
re-branding & relabeling; life cycle management of service parts;
in-house engineering support; and custom packaging solutions. The
Company is headquartered in San Bernardino, California with
facilities in Mexicali, BC; Cd. Juarez, Chih; Calexico, CA; and El
Paso, TX.
Technology Solutions & Services sought Chapter 11 protection
(Bankr. C.D. Cal. Case No. 18-18339) on Oct. 2, 2018. In the
petition signed by Julio C. Garcia, Jr., CFO, the Debtor disclosed
total assets at $9,831,822 and total liabilities at $30,190,109.
Judge Mark D. Houle is assigned to the case. The Debtor tapped
Leonard M. Shulman, Esq., at Shulman Hodges & Bastian LLP as
counsel.
THAKORJI INC: Seeks to Hire Marcus & Millichap as Broker
--------------------------------------------------------
Thakorji, Inc. d/b/a Comfort Suites Stonecrest, seeks authority
from the U.S. Bankruptcy Court for the Northern District of Georgia
to employ Marcus & Millichap Real Estate Investment Services, as
realtor to the Debtor.
Thakorji, Inc., requires Marcus & Millichap to market and sell the
Debtor's real property known as Comfort Suites Stonecrest, a hotel
located at 7910 Mall Ring Road, Lithonia, DeKalb County, Georgia.
Marcus & Millichap will be paid a commission of 2% of the sales
price.
Helen Zaver, realtor of Marcus & Millichap Real Estate Investment
Services, assured the Court that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code and does not represent any interest adverse to the Debtor and
its estates.
Marcus & Millichap can be reached at:
Helen Zaver
MARCUS & MILLICHAP REAL ESTATE
INVESTMENT SERVICES
1100 Abernathy Road, NE Suite 600
Atlanta, GA 30328
Tel: (678) 808-2786
About Thakorji, Inc.
d/b/a Comfort Suites Stonecrest
Thakorji, Inc., is a single asset real estate, as defined in 11
U.S.C. Section 101(51B). The Company owns a hotel located at 7910
Mall Ring Rd Lithonia, Georgia.
Thakorji, Inc., filed a voluntary petition under Title 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 18-70018) on Nov.
30, 2018. In the petition signed by Wesley Dowdy, managing agent,
the Debtor estimated $1 million to $10 million in assets and
liabilities. Danowitz Legal, P.C., led by principal Edward F.
Danowitz, represents the Debtor.
THOMAS O. EIFLER: Successors Buying Book of Business for $1M
------------------------------------------------------------
Thomas O. Eifler, Sr., asks the United States Bankruptcy Court for
the Western District of Kentucky to authorize him to enter into the
Wealth Advisor Transition Agreement with wealth advisors, Eric M.
Vegh, Mark C. Naber, and Kit B. Carter, in connection with the
transfer his rights to manage, service and generate commissions
from his customer accounts in anticipation of his departure from
J.J.B. Hilliard, W.L. Lyons, LLC, for $1 million.
Hilliard currently employs the Debtor as a wealth advisor, and the
employment represents the primary source of revenue for his
bankruptcy estate. Specifically, the Debtor has a network of
clients and customer accounts which constitute his Book of
Business.
The Book of Business engages in trading and commercial activity
with Hilliard, which generates revenue that is paid to the Debtor.
To be clear, the Debtor's network of clients and customer accounts
are free to trade and do business with who they like, and are not
contractually required to continue doing business with the Debtor
or Hilliard.
The Debtor is 76 years old and is asking to transition his Book of
Business in a manner that will provide value for him and his
bankruptcy estate. Accordingly, in order to protect the value of
the Book of Business from losing its value in the event of his
death or disability, the Debtor negotiated the Agreement with the
Successors employed by Hilliard.
The Debtor's employment with Hilliard will terminate effective as
of Dec. 31, 2018. Upon his retirement, Hilliard will have a
regulatory and contractual obligation to continue to service its
customer accounts and clients, including those who are associated
with the Debtor and fall within the Book of Business. Therefore,
if he retires and does not enter into the Agreement, Hilliard will
be obligated to continue to service the Book of Business but the
Debtor will not derive any revenue or benefit from the Book of
Business.
Indeed, it is the customary practice when a wealth advisor resigns,
or is otherwise unable to service his or her client accounts for
Hilliard to redistribute that advisor's book of business among
other wealth advisors with no compensation to the retiring advisor
if a transition agreement is not in place. It is necessary and
routine for a financial services firm to immediately re-distribute
client accounts when there is no transition agreement in place to
avoid any lapse in service to the client. Such immediate
reassignment is critical given the importance of timing with
respect to certain financial decisions.
Under the terms of the Agreement, the Debtor will use his best
efforts to transition his Book of Business to the Successors. In
exchange, Hilliard has agreed to facilitate a payment of $1 million
to be paid by the Successors. The Purchase Price is payable to the
Debtor in equal, monthly installments of $20,833. The payments
will be made over a period not to exceed four years, beginning on
the 15th day of the second month following the Retirement Date and
continuing on or about the 15th day of each month thereafter until
fully paid as contemplated.
In determining the Purchase Price for the Agreement, the Successors
have agreed to facilitate a payment to the Debtor based upon the
trailing 12-month commissions generated from the Book of Business.
A "trailing 12" commission number, as commonly used in the
financial industry, is a calculation of the total commissions
generated by a financial advisor in the preceding 12 months from
any given date.
Significantly, the transaction set forth in the Agreement is the
product of an arms'-length negotiated transaction between the
Debtor and the Successors, and is an arrangement that is standard
to the financial industry. Hilliard routinely facilitates into
agreements substantially similar to the Agreement with its wealth
advisors as a method to preserve client relationships, as a well as
to give security to retiring advisors and ensure they are
appropriately compensated for the relationships they have
cultivated and maintained. This also allows for continuity in
customers relationships with Hilliard so as to avoid unnecessary
disruption to clients' financial
plans. Without such an arrangement, the Debtor risks retiring
without any compensation.
The Debtor asks that the Court enters an order approving and
authorizing the Debtor to enter into the Agreement, thereby
transitioning his role at Hilliard and transferring his interests
in the Book of Business free and clear of all liens, claims,
interests and encumbrances.
The Debtor has determined that the Sale of the Book of Business by
private sale will enable him to obtain the highest and best offer
for these assets, thereby maximizing the value of his bankruptcy
estate. The Agreement is the result of comprehensive, arms'-length
negotiations, and the transaction to be made pursuant to the terms
of the Agreement will provide a fair value for the Debtor's
creditors. The Debtor believes that the value of the consideration
to be received for the Book of Business under the Retirement
Agreement is fair and reasonable.
A copy of the Agreement attached to the Motion is available for
free at:
http://bankrupt.com/misc/Thomas_Eifler_303_Sales.pdf
Thomas O. Eifler, Sr. filed a Chapter 11 petition (Bankr. W.D. Ky.
Case No. 17-31862) on June 6, 2017. At the time of filing, the
Debtor estimated assets and liabilities at $1 million to $10
million each.
The Debtor is represented by:
James E. McGhee III, Esq.
KAPLAN & PARTNERS LLP
710 West Main Street, Fourth Floor
Louisville, KY 40202
Phone: (502) 416-1630
E-mail: jmcghee@kplouisville.com
TINA JONES: TennMO Buying Rutherford Property for $1.2 Million
--------------------------------------------------------------
Tina Marie Jones asks the U.S. Bankruptcy Court for the Middle
District of Tennessee to authorize the sale of the real property
located at 3200 Manchester Hwy, Murfreesboro, Tennessee, consisting
of her residence and approximately 34.84 acres, more or less,
designated as Parcel/Tax ID 126 01300 in the property assessor's
office for Rutherford County, Tennessee, to TennMO Properties, LLC
for $1.2 million, subject to higher and better offers.
The Debtor scheduled in her bankruptcy filing a house and 34.84
acres. It was and is the intention of the Debtor to sell the
property and to pay the creditors of the estate to the extent
possible.
The property has been the subject of three previous Sale Motions
each approved by the Court. The approved Sale Contracts each had
contingencies which allowed the purchaser to terminate the
contracts. The Debtor is currently attempting to try for a 4th
time to sell this piece of property and pay back more to the
creditors in the case than they would receive through a foreclosure
sale and generate funds to fund a repayment to her unsecured
creditors.
By the Motion, the asks seeks entry of an Order setting a hearing
to consider authorization and approval of the sale to be closed on
Jan. 31, 2019, with an objection deadline of Dec. 31, 2018.
Additionally, any competing bids should be presented to the Debtor
by 4:00 p.m. (CT) on Dec. 31, 2018 as described in the Bidding
Procedures. Exercising Debtor's best business judgment, she may
select the bid best suited for the benefit of the Creditors and the
Debtor.
If objection to the Motion is filed and then following the hearing
on Jan. 8, 2019 the Debtor will request entry of an Order approving
among other things the sale by the Debtor and to the Purchaser free
and clear of liens, claims, encumbrances and other interests.
The Debtor and the Purchaser entered into the Purchase and Sale
Agreement for the purchase and sale of the Property on Dec. 3,
2018. The 363 Transaction, as embodied in the Purchase Agreement
contemplates that substantially all of the Debtor's assets,
specifically the Property will be sold and transferred to the
Purchaser. The purchase price for the property is $1.2 million
cash at closing. There will be no real estate brokerage fee paid
by the Seller or the Purchaser.
A copy of the APA attached to the Motion is available for free at:
http://bankrupt.com/misc/Tina_Jones_148_Sales.pdf
Tina Marie Jones sought Chapter 11 protection (Bankr. M.D. Tenn.
Case No. 17-05623) on Aug. 17, 2017. The Debtor tapped Paul E.
Jennings, Esq., at Paul E. Jennings Law Offices, P.C., as counsel.
UNLOCKD MEDIA: Seeks to Hire Mayerson and Hartheimer as Counsel
---------------------------------------------------------------
Unlockd Media, Inc., and Unlocked Operations US Inc. seek approval
from the U.S. Bankruptcy Court for the Southern District of New
York to hire Mayerson and Hartheimer, PLLC as their legal counsel.
The firm will advise the Debtors regarding their duties under the
Bankruptcy Code; represent them in negotiation with their
creditors; assist in the preparation of a bankruptcy plan; and
provide other legal services related to their Chapter 11 cases.
Mayerson charges these hourly fees:
Partners $600
Other Attorneys $300 - $400
Paralegals $100
The firm received a retainer of $50,000 from the Debtors.
David Hartheimer, Esq., at Mayerson, disclosed in a court filing
that the firm's attorneys are "disinterested" as defined in Section
101(14) of the Bankruptcy Code.
Mayerson can be reached through:
Sandra E. Mayerson, Esq.
David H. Hartheimer, Esq.
Mayerson and Hartheimer, PLLC
845 Third Avenue, 11th Floor
New York, NY 10022
Telephone: (646) 778-4380
Email: david@mhlaw-ny.com
Email: sandy@mhlaw-ny.com
About Unlockd Media Inc. and
Unlockd Operations US Inc.
Unlockd Media Inc. -- https://unlockd.com -- is a company that
offers Unlockd a mobile platform that rewards consumers when they
unlock their digital device and view targeted ads, content or
offers.
Unlockd Media and its affiliate Unlockd Operations US Inc. sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y.
Case Nos. 18-13243 and 18-13248) on Oct. 26, 2018. At the time of
the filing, each Debtor estimated assets of less than $500,000 and
liabilities of $1 million to $10 million. The cases have been
assigned to Judge James L. Garrity Jr.
UNLOCKD MEDIA: Seeks to Hire Vernon as Financial Advisor
--------------------------------------------------------
Unlockd Media, Inc., and Unlockd Operations US Inc. seek approval
from the U.S. Bankruptcy Court for the Southern District of New
York to hire Vernon Consulting, Inc., as their financial advisor
and accountant.
The firm will provide services related to the required financial
reporting, development of cash flow and liquidity forecasting, and
planning for the Debtors' Chapter 11 cases.
Vernon charges these hourly fees:
Financial Advisor - Managing Director $425
Financial Advisor - Director $350
Financial Advisor - Senior Managing Consultant $300
Financial Advisor - Analyst $140
Prior to the petition date, the firm received a retainer in the sum
of $12,500.
Vernon is "disinterested" as defined in section 101(14) of the
Bankruptcy Code, according to court filings.
The firm can be reached through:
Laura W. Patt
Vernon Consulting, Inc.
344 E. 65th St. 3C
New York, NY 10065
Phone: 917.822.7578
Fax: 509.278.9343
Email: contact@vernonconsulting.com
About Unlockd Media Inc. and
Unlockd Operations US Inc.
Unlockd Media Inc. -- https://unlockd.com -- is a company that
offers Unlockd a mobile platform that rewards consumers when they
unlock their digital device and view targeted ads, content or
offers.
Unlockd Media and its affiliate Unlockd Operations US Inc. sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
N.Y. Case Nos. 18-13243 and 18-13248) on Oct. 26, 2018. At the
time of the filing, each debtor estimated assets of less than
$500,000 and liabilities of $1 million to $10 million. The cases
have been assigned to Judge James L. Garrity Jr. MAYERSON &
HARTHEIMER PLLC is the Debtor's counsel.
USA GYMNASTICS: Hires Omni as Claims and Noticing Agent
-------------------------------------------------------
USA Gymnastics seeks authority from the U.S. Bankruptcy Court for
the Southern District of Indiana to employ Omni Management Group,
Inc., as claims and noticing agent to the Debtor.
The firm will oversee the distribution of notices and the
maintenance, processing and docketing of proofs of claim filed in
the Chapter 11 cases of the company and its affiliates.
Omni will be paid at these hourly rates:
Analyst $25-$40
Consultants $50-$125
Senior Consultants $140-$155
Equity Services $175
Technology/Programming $85-$135
Omni will be paid a retainer in the amount of $20,000.
Omni will also be reimbursed for reasonable out-of-pocket expenses
incurred.
Brian Osborne, partner of Omni Management Group, assured the Court
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtor and its estates.
Omni can be reached at:
Brian Osborne
OMNI MANAGEMENT GROUP, INC.
5955 De Soto Avenue, Suite 100
Woodland Hills, CA 91367
Tel: (818) 906-8300
Fax: (818) 783-2737
E-mail: lacontact@omnimgt.com
About USA Gymnastics
USA Gymnastics -- https://www.usagym.org/ -- is a not-for-profit
organization incorporated in Texas. Based in Indianapolis, Indiana,
USAG's organization encompasses six disciplines: women's
gymnastics, men's gymnastics, trampoline and tumbling, rhythmic
gymnastics, acrobatic gymnastics, and group gymnastics. USAG
provides educational opportunities for coaches and judges, as well
as gymnastics club owners and administrators, and sanctions
approximately 4,000 competitions and events throughout the United
States annually. More than 200,000 athletes, professionals, and
clubs are members of USAG. USAG sets the rules and policies that
govern the sport of gymnastics in the United States, including
selecting and training the United States gymnastics teams for the
Olympics and World Championships. As of the Petition Date, USAG
employs 53 individuals, nearly all of whom work for USAG
full-time.
USA Gymnastics sought Chapter 11 protection (Bankr. S.D. Ind. Case
No. 18-09108) on Dec. 5, 2018. USAG estimated $50 million to $100
million in assets and liabilities as of the bankruptcy filing.
The Hon. Robyn L. Moberly is the case judge.
USAG tapped JENNER & BLOCK LLP as counsel; ALFERS GC CONSULTING,
LLC and SCRAMBLE SYSTEMS, LLC, as business consulting services
providers; and OMNI Management Group, Inc., as claims agent.
VIKEN MANJIKIAN: $325K Sale of Highway 371 Properties Approved
--------------------------------------------------------------
Judge Sheri Bluebond of the U.S. Bankruptcy Court for the Central
District of California authorized Viken Manjikians' sale of two
adjacent parcels of real property located in Riverside County and
(i) identified as 56311 Highway 371, Anza, California 92539, APN
576-080-016-1, and 56333 Highway 371, Anza, California 92539, APN
576-080-005-1 to David Harville for $325,000.
A hearing on the Motion was held on Dec. 12, 2018 at 10:00 a.m.
The terms of the Commercial Property Purchase Agreement and Joint
Escrow Instructions dated Oct. 24, 2018 attached to the Sale Motion
are approved.
The Bid Procedures are approved.
The sale of the Highway 371 Properties to the Buyer is made on an
"as is, where is" basis without any warranties, expressed or
implied, and without any contingencies, free and clear of all
liens, claims, interests, and encumbrances, with such claims,
liens, interests, and encumbrances to attach to the sale proceeds.
The following payments are approved: (i) through escrow of brokers'
commissions, totaling 8% of the purchase price of the Highway 371
Properties; (ii) of normal closing costs from the sale proceeds,
including but not limited to the Debtor's share of escrow fees and
charges, the cost of a standard coverage title insurance policy,
recording fees, documentary transfer taxes, pro-rated real property
taxes, and other normal and customary charges, prorations, costs,
and fees is authorized; and (iii) from the Sale proceeds of any and
all undisputed claims related to the Highway 371 Properties which
are senior to the lien of Sarkis and Alice Manjikian.
In accordance with the Court's prior order approving the Debtor's
settlement with the Settling Creditors, any sale proceeds from the
Highway 371 Properties which would otherwise be paid to the
Settling Creditors through escrow at closing, up to and including
the sum of $250,000, will instead be paid by escrow to the client
trust account of Weintraub & Selth, APC, the general bankruptcy
counsel for the Debtor, to be held in trust for the purposes
authorized by the 9019 Order. Any sums which would otherwise be
paid to the Settling Creditors and which are in excess of the Carve
Out, if any, will be paid to the Settling Creditors.
Viken Manjikian sought Chapter 11 protection (Bankr. C.D. Cal. Case
No. 16-24801) on Dec. 1, 2017. The Debtor tapped Daniel J.
Weintraub, Esq., at Weintraub & Selth APC, as counsel.
W RESOURCES: Creditors Buying Warren Peak Ranch Property
--------------------------------------------------------
W Resources, LLC, asks the U.S. Bankruptcy Court for the Middle
District of Louisiana to authorize the sale of its Warren Peak
Ranch property in Granite County, Montana, through a credit-bid to
its secured creditors First Interstate Bank and United Mississippi
Bank.
The Debtor is a holding company with a diverse set of raw and
recreational land, farming and hunting operations, an aircraft
hangar, oil and gas interests, and equity-based interests. Its
assets include the Warren Peak Ranch located in Granite County,
Montana. The Warren Peak Ranch includes three tracts of land and
improvements: (a) the "Lord Ranch" tract, with roughly 2,690 deeded
acres, (b) the "Buchanan Ranch" tract, with roughly 3,058 deeded
acres, and (c) the "Ranch House" tract, with less than 40 acres and
a residence.
The Debtor's search of the mortgage records affecting the real
property being sold through the Motion can be summarized as
follows:
a. Encumbering the Lord and Buchanan Ranch tracts:
i. An encumbrance in the nature of a mortgage, recorded on
Dec. 18, 2014, in favor of First Interstate Bank, securing an
original indebtedness of $9,115,000 and with a current indebtedness
of $8,998,199 as of Oct. 1, 2018, exclusive of attorney fees and
costs, with interest accruing daily at the rate of $2,224. The
Trustee has analyzed this secured claim and has no objection to its
allowance under Section 506.
ii. An encumbrance in the nature of a mortgage, recorded on
Sept. 12, 2017, in favor of United Mississippi Bank, securing an
original indebtedness of $2 million. While the Debtor has not
completed its analysis of this mortgage and secured claim, or its
potential avoidability, it will endeavor to do so prior to the
sale.
iii. An encumbrance in the nature of a judicial lien,
recorded on June 18, 2018, in favor of Callais Capital Management,
LLC, 401 Focus Street, Thibodaux, LA 70301, securing indebtedness
of roughly $4.8 million. As this judgment was recorded within the
90 days of bankruptcy it is facially avoidable under Bankruptcy
Code section 547 and is, therefore, subject to bona fide dispute
under Bankruptcy Code section 363(f).
b. Encumbering the Ranch House tract:
i. An encumbrance in the nature of a mortgage, recorded on
March 9, 2017, in favor of United Mississippi Bank, securing an
original indebtedness of $500,000. The Debtor has analyzed this
secured claim and has no objection to its allowance under Section
506.
ii. An encumbrance in the nature of a judicial lien,
recorded on June 12, 2018, in favor of Callais Capital Management,
LLC, 401 Focus Street, Thibodaux, LA 70301, securing indebtedness
of roughly $4.8 million. As this judgment was recorded within the
90 days of bankruptcy it is facially avoidable under Bankruptcy
Code section 547 and is, therefore, subject to bona fide dispute
under Bankruptcy Code section 363(f).
The Debtor intends to sell the Lord and Buchanan Ranches to FIB in
exchange for complete remission of the FIB claim against this
estate, with a current payoff of roughly $9.1 million and other
good and valuable consideration.
The Debtor intends to sell the Ranch House tract to UMB in exchange
for complete remission of that certain UMB claim against this
estate, with a current payoff of roughly $550,000 and other good
and valuable consideration.
Also, that certain State grazing lease on Section 16, Township 5N,
Range 14W (permit #3060364), which is subject to the mortgage of
FIB, will be assumed by the Debtor and assigned to FIB.
The Motion is the second motion for authorization to sell the
Purchased Assets. As the Court is aware, the Debtor previously
filed a motion seeking authority to auction the Purchased Assets
and associated property. The Court approved that motion. The
auction was held in Montana on Nov. 19, 2018. Only one entity bid
at the auction, in the final amount of $10.395 million for all
three tracts of the Warren Peak Ranch, which bid was accepted by
the auctioneer. In reliance on this cash bid, neither FIB nor UMB
exercised their rights under the Auction Order to credit bid their
claims on their collateral. However, the cash bidder has failed
and refused to tender a deposit or to close the sale.
Given the foregoing, the Debtor, in the exercise of its business
judgment, has agreed to sell the Purchased Assets to the Banks in
exchange for releases of the FIB and UMB Claims against the estate,
for the payment to the estate of $55,000 cash and other costs
associated with the closing of the transaction, for the payment of
the estate's obligation to reimburse the auctioneer the sum of up
to $25,000 for out-of-pocket fees and expenses incurred by the
auctioneer in connection with the failed Nov. 19, 2018 auction, and
to retain the auctioneer to market the Lord and Buchanan Ranches
after their acquisition by FIB.
While the Auction Order authorized the Debtor to enter into such
agreements with the Banks, and to close such a sale to the Banks if
they were the successful bidders or back-up bidders at the auction,
the Debtor and the Banks did not enter into such agreements or
close such sales. Accordingly, in an abundance of caution, the
Debtor asks an order specifically approving a credit-bid sale to
each Bank, irrespective of the auction.
Hall and Hall served as auctioneer for the estate. The Debtor
believed it could achieve the best and highest net recovery to the
estate by employing a qualified auctioneer to conduct a public
auction of the property in Montana. The Debtor proposed that Hall
and Hall, a licensed and bonded auctioneer with extensive
experience and success with auctioning property in bankruptcy
matters, liquidate the Property at an absolute auction sale as per
the terms of the Agreement for Sale of Real Estate at Public
Auction, which includes, among other things, that Hall and Hall
will receive a 4% commission on the sale.
The Debtor asks the entry of the Order: (a) authorizing the Debtor
to sell the Purchased Assets to the Banks, free and clear of any
and all liens, claims, encumbrances and interests of any nature or
kind whatsoever; (b) approving the assumption and assignment of
State grazing lease on Section 16, Township 5N, Range 14W (permit
#3060364) by FIB, as well as additional Assumed Contracts and
Leases, if any; (c) approving the modification of the terms of
employment of Hall and Hall Partners, LLP in that certain Agreement
for Sale of Real Estate at Public Auction (which was approved by
the Court); (d) determining that each Bank is a good faith
purchaser pursuant to 11 U.S.C. Section 363(m); (e) abrogating the
Rule 6004(h)stay; and (f) other related relief.
The parties have acted in good faith. Hall and Hall has listed the
Purchased Assets for sale since April of 2016. During that time,
Hall and Hall has aggressively marketed the property and, at the
request of management, steadily reduced the asking price from in
excess of $13 million to $11.5 million dollars. At a price of
$11.5 million dollars, the Purchased Assets generated significant
attention, leading to the Auction Motion.
Given the failure of the auction bidder to perform, and given the
secured claim of the Banks against the Purchased Assets, each of
the preceding four factors has been satisfied. The Debtor
currently has inadequate liquidity to operate. The orderly sale of
the Purchased Assets proposed herein will benefit the Debtor's
creditors. Finally, Hall and Hall will continue to market the
property seeking a non-credit bid transaction pending approval of
the Motion. Accordingly, it asks the Court to approve the relief
sought.
Finally, the Debtor asks the Court to waive the 14 days waiting
period under Bankruptcy Rule 6004(h).
A copy of the Agreement attached to the Motion is available for
free at:
http://bankrupt.com/misc/W_Resources_278_Sales.pdf
About W Resources
W Resources, LLC, is a privately-owned company in Baton Rouge,
Louisiana, engaged in activities related to real estate. It is a
holding company with a diverse set of raw and recreational land,
farming and hunting operations, an aircraft hangar, oil and gas
interests, and equity-based interests.
W Resources sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. La. Case No. 18-10798) on July 23, 2018. In the
petition signed by Dwayne M. Murray, Chapter 11 trustee for Michael
Worley, manager, the Debtor estimated assets and liabilities of
$50 million to $100 million each.
Robbins & Brown, LLC, is the Debtor's legal counsel. Horne LLP
serves as accountant.
[*] BOOK REVIEW: Macy's for Sale
--------------------------------
Author: Isadore Barmash
Paperback: 180 pages
List price: $34.95
Review by Henry Berry
Order your personal copy today at
http://www.beardbooks.com/beardbooks/macys_for_sale.html
Isadore Barmash writes in his Prologue, "This book tells the story
of Macy's managers and their leveraged buyout, the newest and most
controversial device in the modern financial armament" when it took
place in the 1980s. At the center of Barmash's story is Edward S.
Finkelstein, Macy's chairman of the board and chief executive
office. Sixty years old at the time, Finkelstein had worked for
Macy's for 35 years. Looking back over his long career dedicated to
the department store as he neared retirement, Finkelstein was
dismayed when he realized that even with his generous stock
options, he owned less than one percent of Macy's stock. In the 185
years leading up to his unexpected, bold takeover, Finkelstein had
made over Macy's from a run-of-the-mill clothing retailer into a
highly profitable business in the lead of the lucrative and growing
fashion and "lifestyle" field.
To aid him in accomplishing the takeover and share the rewards with
him, Finkelstein had brought together more than three hundred of
Macy's top executives. To gain his support for his planned
takeover, Finkelstein told them, "The ones who have done the job at
Macy's are the ones who ought to own Macy's." Opposing Finkelstein
and his group were the Straus family who owned the lion's share of
Macy's and employees and shareholders who had an emotional
attachment to Macy's as it had been for generations, "Mother
Macy's" as it was known. But the opponents were no match for
Finkelstein's carefully laid plans and carefully cultivated
alliances with the executives. At the 1985 meeting, the
shareholders voted in favor of the takeover by roughly eighty
percent, with less than two percent opposing it.
The takeover is dealt with largely in the opening chapter. For the
most part, Barmash follows the decision making by Finkelstein, the
reorganization of the national company with a number of branches,
the activities of key individuals besides Finkelstein, Macy's moves
in the competitive field of clothing retailing, and attempts by the
new Macy's owners led by Finkelstein to build on their successful
takeover by making other acquisitions. Barmash allows at the
beginning that it is an "unauthorized book, written without the
cooperation of the buying group." But as he quickly adds, his
coverage of Macy's as a business journalist and his independent
research for over a year gave him enough knowledge to write a
relevant and substantive book. The reader will have no doubt of
this. Barmash's narrative, profiles of individuals, and analysis of
events, intentions, and consequences ring true, and have not been
contradicted by individuals he writes about, subsequent events, or
exposure of material not public at the time the book was written.
First published in 1989, the author places the Macy's buyout in the
context of the business environment at the time: the aggressive,
largely laissez-faire, Reagan era. Without being judgmental, the
author describes how numerous corporations were awakened from their
longtime inertia, while many individuals were feeling betrayed,
losing jobs, and facing uncertain futures. Isadore Barmash, a
veteran business journalist and author, was associated with the New
York Times for more than a quarter-century as business-financial
writer and editor. He also contributed many articles for national
media, Reuters America, and the Nihon Kenzai Shimbun of Japan. He
has published 13 books, including a novel and is listed in the 57th
edition of Who's Who in America.
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
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are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
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public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
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equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
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available at your local bookstore or through Amazon.com. Go to
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Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog,
Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa,
Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors.
Copyright 2018. All rights reserved. ISSN: 1520-9474.
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