/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/190718.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, July 18, 2019, Vol. 23, No. 198 Headlines 1989 3AVE: Unsecured Claims Estimated to Total $9.25MM in New Plan ACRISURE LLC: Moody's Rates $300MM Unsec. Notes Caa2, Outlook Neg. AEGERION PHARMACEUTICALS: Still Reviewing 89 Claims ANASTASIA INTERMEDIATE: Fitch Lowers LT IDR to B, Outlook Neg. ANKUR INVESTMENT: Case Summary & Unsecured Creditor AUTOKINITON US: Moody's Reviews B2 CFR for Downgrade on Tower Deal B&W CLEANERS: Aug. 20 Plan Confirmation Hearing BREAULT RESEARCH: Case Summary & 20 Largest Unsecured Creditors BULA WORLD: Aug. 13 Plan Confirmation Hearing BURKHALTER RIGGING: Files Chapter 11 Plan of Liquidation CBCS WASHINGTON: Files Chapter 11 Plan With $120MM Exit Financing CITGO HOLDING: Fitch Raises LT IDR to CCC+, Outlook Stable CONTINENTAL WHOLESALE: Unsecureds to Get $80K in Quarterly Payments CORNERSTONE VALVE: Cameron Objects to Disclosure Statement CREDIT MANAGEMENT: Gets Court Approval to Hire OCP DAH UNIVERSITY: Seeks to Hire Timothy W. Gensmer zs Legal Counsel DANICA ASSOCIATES: Oct. 17 Hearing on Disclosure Statement DATTA MANGLAM: Seeks to Hire Public Insurance Adjuster DIOCESE OF DULUTH: Plan Centers on $39.2MM Deal for Tort Claimants DRYDEN 68: Moody's Assigns Ba3 Rating on $21.5MM Class E Notes EMPIRE GENERATING: Minority Lenders Object to Plan Confirmation EMPRESAS CARRION: Oriental Bank Objects to Disclosure Statement F & S ASSOCIATES: Proposes to Sell Property to Pay Creditors FAITH MISSIONARY: Fidelity Bank Objects to Disclosure Statement FARROW GROUP: Chemical Bank Objects to Disclosure Statement FCH MCKINNEY: Taps Conine Realty Advisors as Realtor FLO-TECH INC: Aug. 27 Plan Confirmation Hearing FREDERICKSBURG EDA: Fitch Rates $24.7MM 2019B Revenue Bonds 'B-' HAMLETT ENTERPRISES: U.S. Trustee Objects to Disclosure Statement HAPPY FACES CHILDCARE: Seeks to Hire Bankruptcy Attorney JOE'S PLACE: Unsecured Creditors to Get 10% Over 60 Months LIQUIDNET HOLDINGS: S&P Upgrades ICR to 'BB-' on Criteria Update LIVE OUT LOUD: Trinity Creditors Object to Disclosure Statement MDMT CONSULTING: Seeks to Hire Richard Feinsilver as Attorney METHODIST UNIVERSITY: Fitch Cuts Rating on 2012 Bonds to BB+ MIDCONTINENT COMMUNICATIONS: Moody's Rates New $985MM Loans 'Ba3' MIDWAY OILFIELD: Taps Germer as Litigation Counsel MURPHY OIL: S&P Cuts ICR to BB+ on Closure of Malaysian Asset Sale NASCAR HOLDINGS: Moody's Assigns Ba2 CFR, Outlook Stable NATIONAL RADIOLOGY: VRAD Objects Disclosure Statement, Plan NEW GARDEN: Taps Gary W. Cruickshank as Legal Counsel NORTHWOODS AUTO: Seeks to Hire Cunningham Chernicoff as Counsel OCALA INN: Unsecured Creditors to Get Full Payment in 12 Months PARKINSON SEED: Unsecureds to Get Annual Payments Over 10 Years PETSMART INC: Moody's Raises CFR to B3, Outlook Stable PORT CITY HOSPITALITY: Hires Galloway Wettermark as Counsel PROMETRIC HOLDINGS: S&P Alters Outlook to Negative, Affirms 'B' ICR PYRATECH SECURITY: Taps Maxwell Dunn as Legal Counsel REGENSBURG HOLDING: Case Summary & 2 Unsecured Creditors REMNANT OIL: Case Summary & 30 Largest Unsecured Creditors RORA LLC: Hampton House Objects to Disclosure Statement RORA LLC: Lender Objects to Disclosure Statement RUBY'S DINER: US Foods Objects to Disclosure Statement SANABI INVESTMENTS: Trustee Taps Robert A. Angueira as Counsel SANJAC SECURITY: Aug. 7 Plan Confirmation Hearing SCOOBEEZ INC: Seeks to Hire Armory Securities as Investment Banker SELECT MEDICAL: Moody's Rates $450MM Revolver Debt 'Ba2' SEVEN STARS: Seeks to Hire Kathleen A. Daly as Special Counsel SHANE TRACY: Taps Robleto Law as Legal Counsel SOLUTIONS BY DESIGN: Aug. 14 Plan Confirmation Hearing SOTERA HEALTH: Moody's Affirms B3 CFR, Outlook Stable SOUTH CENTRAL: City of Houston Objects to Disclosure Statement STEARNS HOLDINGS: Files Blackstone-Sponsored Reorganization Plan SUNTEC ALUMINUM: Aug. 12 Plan Confirmation Hearing TACTICAL SOLUTIONS: Voluntary Chapter 11 Case Summary TINTRI INC: Creditors' Committee Files Chap. 11 Plan of Liquidation TJW FAMILY: Unsecured Creditors to Get Full Payment at 2.59% TPC GROUP: S&P Upgrades ICR to 'B' on Refinancing; Outlook Stable UPSTATE PHYSICIAN: Seeks to Hire Stephen M. Smith as Accountant VALLEY ECONOMIC: Taps David Gottlieb as CRO VALLEY RIVER: Taps Turner & Company as Accountant VILLAGE RED: Unsecured Creditors to Get 0.35% Under Chapter 11 Plan WALL TO WALL: Case Summary & 20 Largest Unsecured Creditors WEATHERLY OIL: Creditors' Committee Objects to Disclosure Statement WEATHERLY OIL: Louisiana Objects to Disclosure Statement WEST DEPTFORD: Moody's Rates New $500MM Secured Loans 'Ba3' WEST DEPTFORD: S&P Assigns Prelim BB- Rating to $445MM Term Loan B WEYERBACHER BREWING: Committee Seeks to Hire Financial Advisor WILKENS 2003: IRS Objects to Plan Confirmation WILSON MANIFOLDS: KKR Objects to Disclosure Statement WOW WEE: Unsecured Creditors to Get Payment From Net Income WP CPP: S&P Affirms 'B' Issuer Credit Rating; Outlook Negative [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* 1989 3AVE: Unsecured Claims Estimated to Total $9.25MM in New Plan ------------------------------------------------------------------ 1989 3Ave LLC, filed an Amended Chapter 11 Plan of Liquidation and accompanying disclosure statement to revise the amount of the stalking horse amount from $22,500,000 to $20,750,000, and to increase the estimated amount of general unsecured claims from $0 to $9,250,000. The Plan provides for a sale of the Property pursuant to bidding procedures. Currently, the Debtor has entered into a "stalking horse" contract with Sunny Sycamore LLC in the amount of $20,750,000. The Stalking Horse Contract provides for Sunny to act as the Stalking Horse and pay $20,750,000 in cash for the Property. Sunny has deposited with the Debtor $2,250,000.00 with the Debtor as a downpayment towards the Stalking Horse Contract. Third Avenue's Secured Claim is estimated to total $10,330,022, while Unsecured Claims are estimated to total $9,250,000. Class 4 Unsecured Claims are unimpaired. In full satisfaction, settlement, release and discharge of the Class 4 Unsecured Claims, each Holder of a Class 4 Allowed Unsecured Claim shall receive, on the Effective Date, or as soon as practicable after each such Claim becomes an Allowed Unsecured Claim, payment from the Disbursing Agent, of Cash equal to 100% of such Allowed Unsecured Claim with interest at the federal judgment rate from the Sale Proceeds and Cash on hand. The Plan shall be funded by either from the Sale Proceeds of the sale of the Property to either the Stalking Horse, or if the Property sold pursuant to the bid procedures, then the Sale Proceeds from the auction of the Property, which shall be used to satisfy payments due consistent with the terms of this Plan. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y65sk76h from PacerMonitor.com at no charge. A redlined version of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/yxuexhl7 from PacerMonitor.com at no charge. The Amended Plan was filed by William X. Zou, Esq., in Flushing, New York; and Robert M. Sasloff, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck P.C., in New York, on behalf of the Debtor. About 1989 3Ave LLC Based in Elmhurst, New York, 1989 3Ave, LLC, a privately held company engaged in activities related to real estate, filed a voluntary Chapter 11 Petition (Bankr. E.D.N.Y. Case No. 18-47234) on Dec. 19, 2018. In the petition signed by Bo Jin Zhu, manager, the Debtor disclosed assets totaling $23,000,106 and liabilities totaling $24,761,785. The case is assigned to Hon. Nancy Hershey Lord. The Debtor is represented by William X. Zou, Esq., in Flushing, New York. ACRISURE LLC: Moody's Rates $300MM Unsec. Notes Caa2, Outlook Neg. ------------------------------------------------------------------ Moody's Investors Service has affirmed the B3 corporate family rating and B3-PD probability of default rating of Acrisure, LLC, and has assigned a Caa2 rating to the company's $300 million issuance of seven-year senior unsecured notes. The notes are being offered to qualified US institutional buyers under Rule 144A of the Securities Act of 1933 and to certain non-US persons under Regulation S. The company intends to use net proceeds of the offering to help fund acquisitions and pay related fees and expenses. In the same action, Moody's affirmed the B2 ratings on Acrisure's senior secured credit facilities and notes and the Caa2 rating on its existing senior secured notes. Moody's maintains a negative rating outlook on Acrisure. RATINGS RATIONALE Acrisure's ratings reflect its growing market presence in US insurance brokerage and its recent international expansion, its good mix of business across property & casualty insurance and employee benefits, and its healthy EBITDA margins, according to Moody's. As an active acquirer, Acrisure maintains the existing brands of its acquired entities and allows them to operate fairly autonomously, while centralizing accounting, compliance and other business tracking systems. Acrisure aligns the interests of its many acquired entities by including significant equity in its purchase consideration. Acrisure Management and Agency Partners own more than 80% of the firm's equity. Offsetting these strengths are the company's large number and dollar volume of acquisitions, its rising debt burden and its persistently high financial leverage. The rapid acquisition pace heightens the management challenges of integrating critical systems, and limiting the firm's exposure to errors and omissions in its delivery of products and services. The company also has large contingent earnout liabilities, which it typically funds through a combination of operating cash flow and incremental borrowings. Acrisure generated organic revenue growth in the low single digits in 2018 and Q1 2019, while maintaining healthy EBITDA margins. The company continued its high pace of acquisitions funded primarily by increased borrowings and partly by preferred equity. Moody's estimates that Acrisure's pro forma debt-to-EBITDA ratio will be at or slightly above 7.5x after giving effect to the proposed incremental borrowing along with run-rate EBITDA from acquisitions funded by the borrowing. Pro forma (EBITDA - capex) interest coverage will be in the range of 1.5x-2x, and free cash flow will be close to zero. The rating affirmation incorporates Moody's expectation that Acrisure will generate positive free cash flow after contingent earnout payments and scheduled debt amortization by H1 2020. Continued negative free cash flow after deducting these payments could lead to a downgrade of the company's ratings. Given the negative rating outlook, an upgrade of Acrisure's ratings is unlikely in the near future. Factors that could lead to a stable outlook include: (i) debt-to-EBITDA ratio below 7.5x; (ii) (EBITDA - capex) coverage of interest consistently above 1.2x; (iii) free-cash-flow-to-debt ratio above 2%, and positive free cash flow after contingent earnout payments and scheduled debt amortization; and (iv) declining proportion of revenue and earnings from newly acquired versus existing business. Factors that could lead to a rating downgrade include: (i) debt-to-EBITDA ratio above 7.5x; (ii) (EBITDA - capex) coverage of interest below 1.2x; (iii) free-cash-flow-to-debt ratio remaining below 2%, or continued negative free cash flow after contingent earnout payments and scheduled debt amortization, through H1 2020; or (iv) disruptions to existing or newly acquired operations. Moody's has affirmed the following ratings (with loss given default (LGD) assessments) of Acrisure, LLC: Corporate family rating at B3; Probability of default rating at B3-PD; $235 million senior secured revolving credit facility (undrawn at March 31, 2019) maturing in November 2021 at B2 (LGD3); $2.5 billion ($2.4 billion outstanding) senior secured term loan maturing in November 2023 at B2 (LGD3); $750 million senior secured notes maturing in February 2024 at B2 (LGD3); $925 million senior unsecured notes maturing in November 2025 at Caa2 (LGD5). Moody's has assigned the following rating (with LGD assessment) to Acrisure, LLC: $300 million seven-year senior unsecured notes at Caa2 (LGD5). Acrisure Finance, Inc. is a co-issuer of the senior unsecured and senior secured notes. The rating outlook for Acrisure is negative. The principal methodology used in these ratings was Insurance Brokers and Service Companies published in June 2018. Based in Grand Rapids, Michigan, Acrisure distributes a range of property & casualty insurance, employee benefits and related products to small and midsize businesses through offices in a majority of US states and through recently acquired operations in the UK, Switzerland and Bermuda. The company generated revenue of $1.3 billion for the 12 months through March 2019. AEGERION PHARMACEUTICALS: Still Reviewing 89 Claims --------------------------------------------------- Aegerion Pharmaceuticals, Inc., and Aegerion Pharmaceuticals Holdings, Inc., filed a further Chapter 11 Plan and accompanying disclosure statement to clarify that the "Plan Support Parties" do not include the official committee of unsecured creditors. The Committee continues to discuss certain Plan provisions with the Debtors and investigate claims. The Committee has not made a determination at this time as to whether it does or does not support the Plan. The Bankruptcy Code provides that an oversecured creditor is entitled to postpetition interest on its claim. Accordingly, because the Bridge Loan Lenders are oversecured creditors (i.e., the value of the collateral securing the Bridge Loan Claims greatly exceeds the value of such claims), the new Plan provides that the New Money Bridge Loan Claim and the Roll Up Loan Claim will include accrued and unpaid fees and interest through the Effective Date. The governmental units that are parties to the Government Settlement Agreements have not at this time sought to accelerate or increase payments under those agreements as a result of the filing of these Chapter 11 Cases or the consummation of the transactions contemplated by the Plan and the Plan Documents. However, the parties to the Government Settlement Agreements reserve all rights under those agreements, including all rights regarding acceleration, at this time. The Debtors and certain of the governmental units that are parties to the Government Settlement Agreements are in discussions regarding the intentions of those parties regarding acceleration of the Debtors’ payment obligations under the Government Settlement Agreements. The Debtors and these parties to the Government Settlement Agreements anticipate reaching resolution on this issue before the Plan is confirmed. The Debtors currently are engaged in the process of reviewing the 89 proofs of claim that were asserted prior to the general bar date. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y4ddv67f from PacerMonitor.com at no charge. A redlined version of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y2whcj7x from Prime Clerk at no charge. About Aegerion Pharmaceuticals Aegerion Pharmaceuticals is a global biopharmaceutical company dedicated to developing and commercializing therapies that deliver new standards of care for people living with rare diseases. With a global footprint and an established commercial portfolio, including MYALEPT (metreleptin) and JUXTAPID (lomitapide), the Company's business is supported by differentiated treatments that treat severe and rare diseases. On November 29, 2016, Aegerion entered into a merger transaction with non-debtor Novelion Therapeutics Inc. (formerly QLT Inc.), a publicly traded company formed under the laws of the Province of British Columbia. As a result of that transaction, Aegerion became an indirect wholly owned subsidiary of Novelion. Aegerion Pharmaceuticals, Inc., and U.S. affiliate Aegerion Pharmaceuticals Holdings, Inc., sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 19-11632) on May 20, 2019. The Lead Debtor estimated $100 million to $500 million in assets and the same range of liabilities as of the bankruptcy filing. The Hon. Martin Glenn is the case judge. The Debtors tapped Willkie Farr & Gallagher LLP as legal advisor; Moelis & Company LLC as financial and restructuring advisor; AP Services, LLC as financial advisor and chief restructuring officer; and Prime Clerk LLC as claims and noticing agent and administrative advisor. The ad hoc group of convertible noteholders tapped Latham & Watkins LLP and King & Spalding LLP as legal advisors; and Ducera Partners LLC as financial advisor. The U.S. Trustee for Region 2 on May 29 appointed two creditors to serve on the official committee of unsecured creditors in the Chapter 11 cases of Aegerion Pharmaceuticals, Inc. and its affiliates. ANASTASIA INTERMEDIATE: Fitch Lowers LT IDR to B, Outlook Neg. -------------------------------------------------------------- Fitch has downgraded Anastasia Intermediate Holdings, LLC and Anastasia Parent, LLC's Long-Term Issuer Default Ratings to 'B' from 'BB-'. Fitch has also downgraded ABH's senior secured revolving credit facility and senior secured Term Loan B to 'B+'/'RR3' from 'BB+/'RR1' based on Fitch's bespoke recovery analysis. The Rating Outlook is Negative. The downgrade reflects the material deterioration in ABH's operating trends after many years of strong growth, including declines in revenue and EBITDA in recent quarters. Adjusted debt/EBITDAR (capitalizing leases at 8x) is now projected to remain elevated at or above 5x over the next two years, assuming EBITDA stabilizes in the low-$100 million range, versus prior expectations in the low $200 million range and significantly lower than 2017 levels of around $175 million. The Negative Outlook reflects concerns that management may be unable to reverse the current negative trajectory in operating results, which could raise questions regarding the long-term health of the brand or the ability of management to successfully execute around new product launches and expense management. Fitch could stabilize ABH's ratings if it gained confidence in its rating case projections, which assumes ABH returns to revenue and EBITDA growth beginning 2020 and adjusted debt/EBITDAR moderates to below 5x. KEY RATING DRIVERS Results Materially Below Expectations Anastasia materially missed expectations in 2018, with EBITDA around 25% and 20% below Fitch's expectations and 2017 results, respectively. Revenue was near-flat to 2017 Fitch's projected annual growth around 12% and management's 20% growth guidance. The revenue miss was concentrated in the U.S., where sales declined 8% compared with management's projection of around 10% growth. Trends worsened as the year progressed, culminating in a 21% topline decline in the fourth quarter. The company attributed the miss to several factors, including supply chain disruptions stemming from a mid-year warehouse move and weakness in the color cosmetics category. Fitch believes that the company could have lost market share to several new celebrity-driven cosmetics lines, including Kylie Jenner's Kylie Cosmetics, Rihanna's Fenty Beauty and Glossier. Revenue declines have continued in 2019, with sales down nearly 30% in the first quarter. The company plans to improve its topline trajectory in the second half through new category and product introductions. Fitch is projecting overall revenue decline of around 6% in 2019, assuming revenue growth turns modestly positive late in the year due to new product introductions. Given incremental investments in selling functions and backoffice infrastructure, EBITDA declines are expected to surpass revenue declines in 2019, with EBITDA projected down around 20%. While some of the recent topline declines are explained by color cosmetics challenges and internal supply chain issues, accelerating sales weakness yields questions regarding ABH's longer term growth potential, particularly in its core categories in which it is concentrated in (eyebrow, face and eye) that have historically benefited from share and distribution gains. If new product introductions are successful, sales could stabilize and resume mid-single digit growth beginning 2020; otherwise Fitch expects revenue could stagnate near projected 2019 levels. ABH would need to show stabilizing operating trends, including the resumption of topline and EBITDA growth, to stabilize its current rating outlook. Exposure to Dynamic Industry with Accelerating Share Shifts The color cosmetics industry has fundamentally positive characteristics, including recession resistance, high margins and historically limited irrational price competition. Recent years, however, have seen the industry - and some of its most venerable brands - disrupted by new marketing and retail channels. The traditional model of marketing cosmetics through magazine and TV ads, and selling through department store counters, has markedly changed. The introduction of social media, combined with declines in magazine and network television consumption, has changed marketing philosophies across the industry. Consumers are building brand awareness and affinity, and product knowledge, through preferred online sites and social influencers. ABH pioneered the use of social media to offer product tutorials and directly interact with customers on product options and optimal usage. The low cost of social media relative to traditional advertising channels have allowed smaller upstart brands to quickly build a presence and customer following online. Celebrities such as Kylie Jenner and Rihanna are using their social platforms to introduce new lines and products. Simultaneously, consumer shopping habits have altered cosmetics purchasing trends. Declines in department store traffic have been a partial cause in the rise of the specialty retail channel in cosmetics, including Sephora (owned by LVMH Moët Hennessy Louis Vuitton) and Ulta Beauty as prominent players. Unlike department stores with limited brand-sponsored counters, the specialty players offer far greater options and a brand-discovery model to generate customer excitement and repeat visits. Prestige brands traditionally sold as department store brands, many of which were or have been resistant to growth in the specialty channel, have seen share loss to upstart brands that are featured in and promoted by these growing retailers. Finally, broader trends around health and wellness have been felt in cosmetics, with brands increasingly employing and advertising natural and organic ingredients, chemical-free compounds and earth friendly packaging. Retailers like drug stores have shifted their cosmetic portfolios to emphasize this trend, reallocating shelf space and promotional focus. All of these trends have led to market share shifts within the beauty industry. New brands have seen rapid sales ramps through social media exposure and shelf space wins at Ulta/Sephora/drug retailers. Some established brands that rely on traditional retail and marketing channels have been unable to shift their strategies commensurate with these trends. Shifting market share has led to M&A activity as larger companies seek to improve their portfolio's growth potential. For example, in the last few years, Estée Lauder purchased upstart brands Becca and Too Faced, while Unilever N.V./Unilever PLC (A/Stable) bought Sundial and Dollar Shave Club, Coty bought Younique Cosmetics and Edgewell Personal Care Company bought the Jack Black brand and merged with Harry's, Inc. (owner of the Harry's shaving brand). Fitch expects the retail and marketing landscape will continue to evolve and affect industry share. Smaller brands like ABH may continue to benefit from increased importance of social media and growth in the specialty cosmetics channel. Conversely, larger brands have deployed capital and intensified efforts to stem market share declines and could pose challenges for further market share gains by younger brands, if strategies are successfully implemented. Finally, consumer shopping and brand interaction habits could sharply change, disrupting current norms which brands like ABH have enjoyed. Impressive Growth Trajectory Through 2017 Prior to 2018, ABH built an enviable track record of growth through expanding points of distribution, product introductions, and savvy use of emerging marketing vehicles. From her industry origins as an eyebrow specialist, founder Anastasia Soare saw a product gap in the cosmetics industry and introduced her first brow-focused line in 2000. The company built a market presence through celebrity endorsements, magazine product placements, and an aggressive focus on customer connections and product quality and innovation. Over time, the company expanded its assortment to include eye shadows, lipsticks, brushes and bronzers amongst other cosmetics products. Supporting the business model are positive characteristics of the cosmetics category, which has reliably grown in the 3%-5% range over time, shown resistance to recessionary pullbacks, and exhibits limited price promotion and a strong margin profile for brand leaders. Underscoring ABH's unique go-to market philosophy has been a tutorial approach, offering customers advice (through videos) on optimal product usage and application. This philosophy led the company's decision to be an early adopter of the Instagram platform, where ABH can share videos, interact with customers and expand its reach. The ABH has nearly 20 million Instagram followers and productive relationships with key social media influencers who use ABH products in their photos and videos. ABH's social platform has been a key source of establishing and maintaining close customer connections without an extensive market budget; in fact, ABH spends around 1% of revenue on marketing compared with sizable peers like Revlon Consumer Products Corporation, The Estée Lauder Companies Inc. and Coty Inc., which spend between 20%-30% of revenue on marketing. The company has expanded its retail reach with partners such as growing specialty players Sephora and Ulta, and department stores Nordstrom, Inc. (BBB+/Stable) and Macy's, Inc. (BBB/Stable). ABH has become a sought-after brand for retailers and is a top-performer across key retail accounts. The company's brands are sold in around 2,600 stores in North America and over 1,000 internationally (both figures as of mid-2018). Products are sold online on its own website, Amazon.com, Inc. (A+/Stable) and the e-commerce channel of many of its retail partners. Approximately 19% of ABH's sales are derived from customers outside the U.S./Canada, including both the retail and e-commerce channels. ABH's successful expansion is evidenced by its topline trajectory with an approximately 64% revenue CAGR from 2014 to 2017. While ABH showed strong growth prior to 2018, it has become somewhat of a case study in the ability for new beauty brands to quickly gain traction in the marketplace using effective marketing or partnerships (for example celebrities). A brand's ability to sustain long-term growth and market share is likely more challenging, particularly as ABH shows that new brands can quickly disrupt existing business models. For example, Lady Gaga is set to launch a beauty line later in 2019 with Amazon.com, Inc. (A+/Stable,) which could quickly gain share from incumbents predicated on Lady Gaga's popularity and Amazon's customer connections and distribution assets. Good Albeit Weakening Financial Profile Despite recent declines, ABH's margin profile and cash conversion characteristics exceed peers. The company's EBITDA margins are industry-leading despite recent declines. Fitch believes the company's outperformance of peers is largely due to minimal marketing expense but may also relate to less corporate infrastructure, including backoffice functions like merchandising and inventory planning. Given plans to increase growth investments in new products, geographies and owned e-commerce, EBITDA margins could continue to decline although remain at the upper end of its peer set. ABH generates ample cash flow, historically due to limited leakage from good EBITDA generation though this has been somewhat dampened by recently increased capital expenses and the introduction of interest expense following 2018's debt issuance. Cash flow after estimated owner distributions for cash taxes but before estimated discretionary owner distributions, trended between 10% and 20% of revenue historically, including an estimated $50 million in 2017. Despite EBITDA declines and increases in cash interest expense and capex, Fitch estimates cash flow prior to discretionary owner distributions improved to approximately $90 million in 2018, largely due to positive working capital swings. Given Fitch's forecast of declining EBITDA in 2019 and neutral working capital, cash flow before discretionary owner distributions could remain strong but decline toward $50 million annually. While FCF has historically been used for owner distributions, ABH could direct some cash flow toward debt reduction beyond what would be mandated by its excess cash flow sweep under its new term loan, though Fitch is not forecasting any discretionary prepayments. Growth Avenues Present Risk and Opportunity Prior to its recent topline challenges, the company had identified international expansion and e-commerce as key growth opportunities. The company believes international expansion to be an opportunity given its product assortment is conducive for customers with a diverse range of skin/hair tones, and based on its existing customer reach through social media. The company has recently entered several new markets with strong initial customer acceptance. To grow market share internationally, ABH would need to successfully challenge large incumbent brands as it has in the U.S., while in some markets, ABH would need to change customer habits around makeup regimens to promote product usage. ABH will also need to select partners, such as Sephora (which has around 1,500 stores internationally), which can appropriately showcase the brand and support ABH's social media efforts to educate consumers about its products. Fitch believes ABH can leverage its social media platform to ramp in new geographies with the right retail partner. Fitch's base case assumes international revenue grows 5% to 10% annually, which could yield international's revenue penetration modestly increasing over time. ABH's U.S./Canada ecommerce penetration from its own site is somewhat lower than Euromonitor's estimate of 12% ecommerce penetration of U.S. color cosmetics (in 2017). Online penetration of the industry is somewhat below the approximate mid-20% retail average (excluding low-online categories like auto and grocery) due to the sensory and try-on nature of the category. Fitch estimates a significant portion of online cosmetics sales follow an in-person experience of the brand/product. Given ABH's existing penetration and strong social media following, the company believes it has an opportunity to drive sales on its owned site. The company plans to ramp efforts in digital marketing, including search engine optimization, display adds and affiliates. ABH will also embark upon a site redesign, adding features and customer services to its offering. The company also plans to use its website as an avenue through which to introduce new products and offer an assortment not available at third-party retailers. While ABH's owned ecommerce penetration is below the industry average, Fitch estimates ABH's overall online penetration higher, including sales generated on websites of key customers like Sephora and Ulta and aforementioned international sites. Given its overall strong online penetration, ABH's ability to drive incremental sales from its owned ecommerce website could be limited or may cannibalize sales from other websites and channels. As such, Fitch projects an e-commerce CAGR for ABH to be in the mid-single digits, at or modestly above the expected industry growth rate. Increasing penetration of direct sales should be margin accretive to ABH by eliminating margin leakage to retail partners. The risk, however, is alienating retailer relationships, which Fitch believes are key to ABH given its customer concentration with key accounts, a sensory-focused category and ABH's below-average marketing spend. Finally, ABH plans to continue expanding its product suite beyond its original brow-focused assortment. The company continues to be somewhat narrowly focused, with around half of sales in brow/lip products, and could increase sales to existing customers through additional categories such as foundation (a category focus in 2019). While brand extensions allow an opportunity to leverage the ABH name into new categories, it also creates some risk of brand dilution and execution risk as product assortment expands. Further, while ABH was somewhat of a pioneer in the brow category, entrenched competitors exist across much of ABH's product opportunity set and ABH would need to drive share away from existing players. Increasing Leverage Profile Prior to 2018, ABH operated with essentially no debt. In 2018, the company sold a minority equity stake to TPG Capital for a reported $700 million and issued $650 million in term loans; together these proceeds provided the company founders a cash dividend. Adjusted debt/EBITDAR following the transaction was 3.6x on 2017 EBITDA. Given around 20% EBITDA decline, however, adjusted debt/EBITDAR in 2018 climbed to approximately 4.6x. Given Fitch's forecast of around 20% EBITDA declines in 2019, adjusted debt/EBITDAR could climb to the mid-5x range before declining below 5x in 2021, assuming some sales stabilization and EBITDA improvement. Given the company's good FCF generation, ABH could proactively reduce term loan borrowings beyond required amortization and excess cash flow sweep payments, though Fitch is not forecasting any discretionary repayments. DERIVATION SUMMARY ABH's 'B'/Negative rating reflects the company's material miss of expectations in 2018, with EBITDA around 25% and 20% below Fitch's expectations and 2017 results, respectively, and continued sales and EBTDA declines in 2019. The rating also considers the company's narrow product and brand profile, and risk that continued beauty industry market share shifts could further weaken ABH's projected growth through the risk of new entrants and brand extensions from existing large players. Avon Products, Inc.'s 'B+' rating reflects its significant scale as a leading direct-selling beauty company with $5.4 billion revenue in 2018 and its well-recognized brand in the beauty industry. It also considers the company's challenged operating trajectory, secular pressures, and exposure to volatile end markets. The Rating Watch Positive reflects Naturas Cosméticos S.A.'s proposed acquisition of Avon in an all-stock transaction valued at $3.7 billion on an enterprise value basis (9.5x/5.6x 2018 EBITDA without/with synergies). Mattel's 'B-'/Negative rating reflects execution risk in stabilizing revenue and growing EBITDA from depressed levels. The company's LTM gross leverage (debt/EBITDA) is highly elevated at 9x and there is some refinancing risk with $600 million of aggregate non-guaranteed unsecured debt due in 2020-2021, although the company has the capacity to issue guaranteed debt to refinance these maturities, similar to the 2018 refinancing of $0.5 billion in maturities. ACCO Brands' Corporation's 'BB'/Stable rating reflects the company's consistent FCF and reasonable leverage around low 3x given ongoing debt repayment post recent acquisitions. The ratings are constrained by secular challenges in the office products industry and channel shifts within the company's customer mix, as evidenced by recent results, as well as the risk of further debt-financed acquisitions. Spectrum Brands, Inc.'s 'BB'/Stable rating is supported by the company's diversified portfolio across products and categories, strong brand portfolio, renewed financial discipline as evidenced by its public commitment to maintain net leverage (net debt/EBITDA) at or below 3.5x over the long-term, expectations for stable to low-single digit organic revenue growth, solid profitability with EBITDA margin of approximately 15% pro forma for the divestitures of the batteries, lighting, and auto care divisions and historically consistent FCF. These positive factors are offset by strong competition, profit margin pressures across three of its four core segments, the company's acquisitive nature historically and potentially greater overall business cyclicality due to the increased contribution of hardware and home improvement to total EBITDA post divestitures. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer - Fitch expects ABH's revenue to decline around 6% in 2019 and return to mid-single digit, positive growth in 2020, assuming the company's product introductions and selling organization investments are successful. Fitch projects the North American and e-commerce businesses to grow in line with the company average, with modestly faster growth internationally. Given already reported first-quarter results, the company would need to see a material trend improvement in the second half of 2019 for Fitch to build confidence in ABH's long-term revenue potential and to stabilize its rating; - EBITDA, which declined around 25% in 2018, is expected to decline around 20% in 2019 given revenue declines and selling investments. Assuming revenue begins to grow in 2020, EBITDA could expand as well; - Discretionary cash flow, after owner distributions for tax payments, is forecast in the $50 million to $60 million range annually. Beyond required term loan amortization and excess cash flow sweep payments, ABH could reduce debt through opportunistic repayment although Fitch is not projecting any discretionary debt paydown; - Total adjusted debt/EBITDAR (capitalizing leases at 8x), which was 4.6x in 2018, is forecast to climb to the mid-5x range in 2019 on EBITDA declines but moderate to below 5.0x in 2021. ANKUR INVESTMENT: Case Summary & Unsecured Creditor --------------------------------------------------- Debtor: Ankur Investment, Inc. 17600 Dix Road Melvindale, MI 48122 Business Description: Ankur Investment, Inc. is a privately held company in the traveler accommodation industry. The Company previously sought bankruptcy protection on Nov. 10, 2013 (Bankr. E.D. Mich. Case No. 13-60545). Chapter 11 Petition Date: July 16, 2019 Court: United States Bankruptcy Court Eastern District of Michigan (Detroit) Case No.: 19-50367 Judge: Hon. Marci B. McIvor Debtor's Counsel: Jeffrey S. Grasl, Esq. GRASL PLC 31800 Northwestern Hwy., Suite 350 Farmington Hills, MI 48334 Tel: (248) 385-2980 Email: jeff@graslplc.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Nareshkumar Patel, manager. The Debtor lists Quast Janke & Company as its sole unsecured creditor holding a claim of $11,542. A full-text copy of the petition is available for free at: http://bankrupt.com/misc/mieb19-50367.pdf AUTOKINITON US: Moody's Reviews B2 CFR for Downgrade on Tower Deal ------------------------------------------------------------------ Moody's Investors Service placed Autokiniton US Holdings, Inc.'s B2 senior secured and Corporate Family rating under review for downgrade. This follows the announcement that Autokiniton Global Group, L&W's parent, has entered into a definitive agreement to acquire Tower International, Inc. Tower is the ultimate parent holding company of its debt issuing entity, Tower Automotive Holdings USA, LLC. The B1 senior secured and corporate family rating and positive outlook on Tower's debt are unaffected at this time. Ratings placed on review for downgrade: Issuer: Autokiniton US Holdings, Inc. Corporate Family Rating, Placed on Review for Downgrade, currently B2 Probability of Default Rating, Placed on Review for Downgrade, currently B2-PD $450 million first lien senior secured term loan B facility, Placed on Review for Downgrade, currently B2 (LGD4) Outlook Actions: Issuer: Autokiniton US Holdings, Inc. Outlook, Changed To Rating Under Review From Stable RATINGS RATIONALE The review will consider L&W's proposed capital structure, the integration challenge of tripling the company's scale through this transaction, the prospects for earnings and cash flow growth and ability to control costs given softening global automotive industry conditions, the use of cash on hand or additional equity from the company's sponsors (affiliates of KPS Capital Partners, L.P.) to maintain L&W's credit metrics, the prospective liquidity profile of the combined companies, and the extent that, in Moody's view, the company will continue to be used as a platform to make future acquisitions. Moody's believes that a downgrade of the ratings, if any, would be limited to one notch. The transaction is anticipated to close in September or October of 2019. According to the company's announcement, AGG will acquire Tower for $31 per share in cash. The all-cash transaction represents a 70% premium to Tower's closing stock price on July 11, 2019. Including Tower's debt and pension related liabilities, the total value of the transaction is approximately $900 million. Moody's estimates that assuming the transaction is completely funded with debt, L&W's pro forma debt/EBITDA increases to about 5.9x for the LTM period ending March 31, 2019 from 4.6x (both inclusive of Moody's standard adjustments). Positively, the transaction is expected to completement L&W's product offerings to its automotive manufacturing customers and will likely create cost saving synergies, as the operations of both companies are largely North American. In addition, L&W's management is experienced in consolidating metal related businesses in the North American automotive parts supplier sector. Further, the above pro forma leverage calculation does not consider the significant amount of combined cash on hand as of March 31, 2019 of $252 million. This combined cash level results largely from the net proceeds of approximately $200 million (after certain payments and a $50 million debt paydown) from the sale of Tower's European operations in March 2019. Given this potential cash available to the new capital structure, pro forma Debt/EBITDA could reduce to 5.1x. The principal methodology used in these ratings was Global Automotive Supplier Industry published in June 2016. Tower International, Inc., headquartered in Livonia, Michigan, is a leading manufacturer of engineered automotive structural metal components and assemblies primarily serving original equipment manufacturers. Tower offers automotive customers a broad product portfolio, supplying body-structure stampings, frame and other chassis structures, and complex welded assemblies for small and large cars, crossovers, pickups, and sport utility vehicles. Revenues for the LTM period ending March 31, 2018 were $1.5 billion. Autokiniton US Holdings, Inc., headquartered in New Boston, Michigan, is a leading Tier 1 supplier of specialized metal stampings, welded assemblies, and hot stampings to the automotive industry. The company is owned by affiliates of KPS Capital Partners, L.P. Revenues for the LTM period ending March 31, 2018 were $733 million. B&W CLEANERS: Aug. 20 Plan Confirmation Hearing ----------------------------------------------- The Amended Disclosure Statement explaining the Chapter 11 Plan filed by B&W Cleaners, Inc., is approved. August 20, 2019 is fixed for the hearing on confirmation of the Plan at 9:00 A.M., in Courtroom 3 Second Floor, Customs House, 701 Broadway, Nashville, Tennessee 37203. August 8, 2019 is fixed as the last day for filing and serving written objections to confirmation of the Plan. A full-text copy of the Second Amended Disclosure Statement dated January 31, 2019, is available at https://tinyurl.com/y4nk5cna from PacerMonitor.com at no charge. About B.W. Cleaners LLC B.W. Cleaners, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 18-03729) on June 3, 2018. At the time of the filing, the Debtor disclosed that it had estimated assets of less than $100,000 and liabilities of $1 million. Judge Marian F. Harrison presides over the case. BREAULT RESEARCH: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: Breault Research Organization, Inc. 2175 E. Valencia Rd, #125 Tucson, AZ 85706 Business Description: Breault Research Organization, Inc. -- http://www.breault.com-- is an optical engineering firm providing optical software products and training courses that help engineers turn creative visions into working prototypes, and the Company's own engineers work on projects for Fortune 500 companies, research institutions, and top government labs. BRO provides optical engineering services for companies requiring optical design solutions that outperform the competition. Clients include Agilent, Raytheon, General Dynamics, Lockheed Martin, NASA, and many other recognized names in industry. BRO is a privately held company headquartered in Tucson, Arizona. Chapter 11 Petition Date: July 16, 2019 Court: United States Bankruptcy Court District of Arizona (Tucson) Case No.: 19-08754 Debtor's Counsel: Cassandra B. Meynard, Esq. WATERFALL, ECONOMIDIS, CALDWELL, HANSHAW & VILLAMANA, P.C. 5210 E. Williams Circle Ste 800 Tucson, AZ 85711 Tel: 520-745-7821 520-202-5018 Fax: 820-745-1279 Email: cmeynard@waterfallattorneys.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Matthew Pobloske, president. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/azb19-08754.pdf BULA WORLD: Aug. 13 Plan Confirmation Hearing --------------------------------------------- The Disclosure Statement explaining the Chapter 11 Plan filed by Bula World Holdings Limited Liability Company is conditionally approved. A hearing will be held on August 13, 2019 at 10:00 am for final approval of the Disclosure Statement and for confirmation of the Plan before the Honorable John K. Sherwood, United States Bankruptcy Court, District of New Jersey, 50 Walnut St., Newark, NJ 07102 in Courtroom 3D. August 6, 2019 is fixed as the last day for filing and serving written objections to the Disclosure Statement and confirmation of the Plan. A full-text copy of the Disclosure Statement dated July 3, 2019, is available at https://tinyurl.com/yxobfg2l from PacerMonitor.com at no charge. Based in Stanhope, New Jersey, Bula World Holdings Limited Liability Company filed a voluntary Chapter 11 petition (Bankr. D.N.J. Case No. 19-19243) on May 6, 2019, and is represented by Stephen B. McNally, Esq., at McNally & Busche, L.L.C. BURKHALTER RIGGING: Files Chapter 11 Plan of Liquidation -------------------------------------------------------- Burkhalter Rigging, Inc., Burkhalter Specialized Transport, LLC, and Burkhalter Transport, Inc., filed a Chapter 11 Plan of Liquidation and accompanying disclosure statement. Class 5 - General Unsecured Claims are impaired. Each Holder of a Class 5 Allowed General Unsecured Claim shall be paid its Pro Rata share of any Distributions from the Liquidation Trust on such terms and in such priority as set forth in the Metro Settlement. Class 2 - Metro Claim are impaired. This Class 2 Claim shall be paid pursuant to the Metro Settlement. Notwithstanding anything in this Plan to the contrary, all Liens and Claims held by a Holder of a Class 2 Claim shall be released once the Class 2 Claim shall be released pursuant to the Metro Settlement. Class 6 - Intercompany Claims are impaired. Class 6 Intercompany Claims shall be cancelled pursuant to the Metro Settlement. Class 7 - Equity Interests are impaired. Each holder of an Allowed Class 7 Claim shall receive its Pro Rata share of the net proceeds of the Liquidation Trust Assets pursuant to the terms set forth in the Liquidation Trust Agreement. Funds needed to make distributions under the Plan will come from the Liquidation Trust Assets and the BP Litigation Proceeds. As of the filing of this Disclosure Statement, the Estates have approximately $20.2 million in Cash. The Confirmation Hearing has been scheduled to commence on August 8, 2019 at 1:30 p.m. (CST), before the Honorable Marvin Isgur, United States Bankruptcy Judge, United States Bankruptcy Court, United States Courthouse, 515 Rusk Street, Room 404, Houston, Texas 77002. Any objection to confirmation of the Plan must be filed and served not later than September 4, 2019 at 4:00 p.m. (CST). A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/yxqvn97p from PacerMonitor.com at no charge. The Plan was filed by Marcus A. Helt, Esq., at Foley Gardere LLP, in Dallas, Texasl and Jack G. Haake, Esq., at Foley Gardere LLP, in Washington, D.C. About Burkhalter Rigging Burkhalter Rigging, Inc., Burkhalter Transport, Inc., and Burkhalter Specialized Transport, LLC, each filed voluntary petitions seeking relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 19-30495) on Jan. 31, 2019. In the petition signed by Brooke Burkhalter, president, the Debtor estimated $10 million to $50 million in assets and $10 million to $50 million in liabilities. The case is assigned to Judge Marvin Isgur. Marcus Alan Helt, Esq., at Foley & Lardner LLP, is the Debtor's counsel. Dacarba LLC is serving as chief restructuring officer. National Transaction Advisors, Inc., is financial advisor and investment banker. Henry Hobbs Jr., acting U.S. trustee, appointed an official committee of unsecured creditors in the Debtors' cases on Feb. 19, 2019. The committee tapped Lugenbuhl, Wheaton, Peck, Rankin & Hubbard as its legal counsel, and Stout Risius Ross, LLC as its financial advisor. CBCS WASHINGTON: Files Chapter 11 Plan With $120MM Exit Financing ----------------------------------------------------------------- CBCS Washington Street L.P., filed a Plan of Reorganization and accompanying disclosure statement proposing that holders of unsecured claims, classified in Class 3, which are unimpaired, will receive on the Effective Date, from the Proceeds, Cash in the full amount of its Allowed Unsecured Claim. Funding for the Plan will be from the Exit Financing and, if necessary, the Equity Contribution. In June 2019, the Debtor entered into a Letter of Definitive Terms and Conditions setting forth the commitment of Hana Financial Investment to extend a loan to the Debtor in the maximum amount of $120,000,000, subject to Bankruptcy Court approval, which exit financing will be the means of implementation of the Debtor's Plan and the funding source for the completion of construction of the hotel on the Premises. A full-text copy of the Disclosure Statement dated July 10, 2019, is available at https://tinyurl.com/yyvql8ke from PacerMonitor.com at no charge. Attorneys for the Debtor are A. Mitchell Greene, Esq., Fred B. Ringel, Esq., and Lori Schwartz, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck P.C., in New York. About CBCS Washington Street CBCS Washington Street LP is a partnership and a lessee under an Agreement of Lease dated June 19, 2013 with 445 Washington LLC for the parcels of real property located in New York. The Debtor is currently developing the premises into a 96-room luxury hotel under the "Hotel Barriere Le Fouquet" brand. Based in White Plains, N.Y., CBCS Washington Street filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 19-22607) on March 12, 2019. In its petition, the Debtor disclosed $40,500,496 in assets and $17,201,731 in liabilities. The petition was signed by Ivaylo V. Ninov, authorized representative of Washington Street Hotel GP LLC, GP. The Hon. Robert D. Drain oversees the case. Fred B. Ringel, Esq., at Robinson Brog Leinwand Greene Genovese & Gluck P.C., is the Debtor's bankruptcy counsel. The U.S. Trustee for Region 2 on May 1 appointed three creditors to serve on the official committee of unsecured creditors in the Chapter 11 case of CBCS Washington Street LP. CITGO HOLDING: Fitch Raises LT IDR to CCC+, Outlook Stable ---------------------------------------------------------- Fitch Ratings has upgraded the long-term IDR of CITGO Holding, Inc. to 'CCC+' from 'CCC', upgraded the ratings of all senior secured debt at Holdco to 'B+'/'RR1' from 'B'/'RR1', and assigned a 'B+'/'RR1(EXP)' rating to the new Holdco secured notes and term loan. Proceeds from the new secured notes and term loan will be used to pay off the company's existing 10.75% 2020 Holdco notes. Fitch has also affirmed the long-term IDR of CITGO Petroleum Corp. (Opco) at 'B', and affirmed the 'BB'/'RR1' ratings for Opco's secured notes, term loan and IRBs. The Outlook at Opco remains Stable. The main drivers for the actions are the company's successful expected refinancing of its $1.875 billion 2020 Holdco maturity, which addresses near-term refinancing issues at Holdco, and also helps reduce contagion risk for CITGO through favorable revisions to change in control indenture language. This revised language requires a double trigger prior to a mandatory change in control offer (90 day trigger, plus failure by rating agencies to affirm the existing rating). Fitch believes the new conditions have a lower probability of being triggered, as is discussed further. Following the transaction, approximately 85% of CITGO's total consolidated debt will have this double trigger in place. Transaction Summary: Net proceeds from the CITGO Holdco senior secured term loan and notes, as well as cash on hand, will be used to redeem the existing 2020 10.75% Holdco notes, related accrued interest and premiums, and to fund a 12 month debt service reserve account set up for the benefit of the noteholders. The notes and term loan are secured by a 1st priority lien on the capital stock of CITGO Petroleum Corporation, equity interests in subsidiaries of the issuer (excluding those held by Opco), five terminals and three pipelines, as well as other tangible and intangible assets. The term loan also has a maximum debt to cap covenant of 75% and an excess cash flow sweep. CITGO's ratings are supported by the quality of its refining assets, its modest capex requirements, a reasonably strong macro environment for refiners, the positive expected tailwinds of IMO 2020 for high complexity refiners, and the favorable impact of revised change in control language, which applies to most of CITGO's debt following recent refinancing and consent activity. Rating concerns are material and include the previously mentioned contagion issues; market access issues for CITGO on a stand-alone basis; the impact of weaker light-heavy crude oil spreads on coker economics; and exposure to hurricane risk for the company's gulf coast assets. The 'CCC+' rating at Holdco reflects Holdco's high level of dependence on Opco for distributions to meet its debt payments. KEY RATING DRIVERS Transaction Lowers Refinancing Risk: The announced transactions address refinancing concerns around the company's largest maturity: the $1.875 billion 10.75% Holdco notes due 2020. The refinancing of these notes is the second capital markets tap the company has done this year, and follows the issuance of a $1.2 billion Opco term loan B at the end of March. Both transactions demonstrated the company's ability to access the markets during a challenging period for high-yield issuers in the energy space, albeit at relatively expensive levels. To date, CITGO's market access has been complicated by overhangs from PDVSA and related sanctions risk. Reduced Change of Control Risks: CITGO has lowered the risk of financial contagion from ultimate parent PDVSA risk through the implementation of favorable change in control language in its indentures. Existing change of control language clauses in CITGO's debt could force the company to repurchase its debt at 101 in the event PDVSA is no longer its majority owner and CITGO is unable to obtain sufficient consents from lenders. The financial weakness of parent PDVSA means that there are several paths that could trigger change of control. However, CITGO has replaced the previous language with a more benign, two trigger test: less than majority ownership by PDVSA, and a related failure by rating agencies to affirm the ratings within 90 days. Fitch believes that this test has a lower probability of being triggered for several reasons: the 90 day period gives more time and transparency around any refinancing process, easing bondholder concerns about completion; CITGO's previously mentioned demonstrated market access; and the fact that the company's credit profile would be expected to improve under nearly any other owner besides PDVSA, which limits incentives of bondholders to tender the bonds in the first place. Including the refinancing, the new double trigger language now applies to approximately 85% of CITGO's debt. Higher Interest Expense Manageable: CITGO's interest expense has risen following refinancing activity earlier this year, including the replacement of its low cost revolver and A/R Securitization facilities with a fully drawn $1.2 billion Opco TL-B (L+500). Nonetheless, Fitch views the increase as manageable in the context of CITGO's strong FCF, limited capex needs and high cash balances. Strong Refining Assets: CITGO owns and operates three large, high-quality refineries, providing sufficient economies of scale to compete with larger tier-one refiners. CITGO's refineries have above-average complexity, including substantial coking capacity, which allow them to run a wide range of discounted heavy and sour crudes. The company should benefit from 2020 IMO regulations, which are expected to both boost distillate demand and result in additional discounting for heavy sour crudes. CITGO's flexible refining system also allows for the processing of significant amounts of discounted light sweet shale crude, as well as favorable access to export markets, which is important to maintaining high utilization. CITGO's assets have concentrated hurricane risk exposure, given that two of three of its refineries (78% of crude processing capacity) are on the gulf coast. Robust Financial Results CITGO Petroleum's financial results remain strong despite recent debt increases. As calculated by Fitch, LTM EBITDA at March 31, 2019 stood at approximately $1.7 billion, while debt rose to $2.83 billion following the issuance of the $1.2 billion Opco term loan at the end of March to replace expiring revolver and A/R Securitization facilities. As a result, LTM debt/EBITDA stood at 1.7x, versus 0.9x at YE 2018. Opco's EBITDAR/gross interest plus rents stood at 5.1x, while FCF was $469 million. Given existing OFAC sanctions against PDVSA and the resultant inability to move cash beyond the Holdco level, Fitch anticipates cash may build across the organization, improving net debt metrics. Improved Governance: In line with U.S. sanctions, CITGO has severed all relationships with its PDVSA-appointed board and a new board has been installed by the Guaido-led faction of Venezuela, including Luisa Palacios as Chairwoman, Edgar Rincon, Luis Urdaneta, Angel Olmeta, Andres Padilla and Rick Esser. Operationally, CITGO has ceased all financial and operational interactions with PDVSA, including oil related sales. The new board has extensive energy sector experience but remains somewhat untested in its current board role. Fitch believes governance is set to improve at the company post-separation and will continue to monitor the situation; however, challenges remain, including a lawsuit by the Maduro-appointed board to attempt to regain control of CITGO. Parent-Subsidiary Linkage: Fitch rates the IDR of Holdco two notches below that of its stronger subsidiary, Opco. The notching differential stems from the significant legal and structural separations between the two, primarily the strong covenant protections for Opco's debt, which limits the ability of its direct parent to dilute its credit quality. Key covenants include limitations on guarantees to affiliates, restrictions on dividends, asset sales, and restrictions on the incurrence of additional indebtedness. Opco debt has no guarantees or cross-default provisions related to Holdco debt. The two notch separation also reflects Holdco's high level of dependence on Opco to meet its debt payments. Based on the impact of OFAC restrictions—which have severed commercial, operational and control ties between CITGO and PDVSA, and have also led to the appointment of an independent CITGO board—Fitch no longer views the linkage between CITGO and PDVSA as material to the rating under Parent-Subsidiary Linkage. While there is still indirect contagion risk from PDVSA from change in control clauses mentioned above, Fitch believes those are best addressed as a market access issue in the context of a stand-alone rating for CITGO. CITGO HOLDING: Ratings for CITGO Holding reflect its structural subordination to Opco, and its reliance on Opco to provide dividends to cover its significant debt service requirements. Dividends from Opco provide the majority of debt service capacity at Holdco, and are driven by refining economics and the restricted payments basket. CITGO Holding's pledged security includes approximately $40 million-$60 million in EBITDA from midstream assets that are available for interest payments. These logistics assets are pledged as collateral under the CITGO Holding debt package. DERIVATION SUMMARY At 749,000 bbl/d day of crude refining capacity, CITGO is smaller than investment-grade refiners such as Marathon Petroleum Corporation (3.0 million bbl/d), Valero (2.6 million bbl/d), and Phillips 66 (1.9 million bbl/d), but is larger than Hollyfrontier (457,000 bpd). CITGO lacks the earnings diversification from ancillary businesses seen at a number of its peers in areas such as logistics MLPs, chemicals, renewables and retail. However, CITGO's core refining asset profile is strong, given the high complexity of its refineries, which allows it process a large amount of discounted heavy crudes and shale crudes, both of which boost profitability. Given CITGO's relatively strong asset footprint, cash flow potential, and size, Fitch informally estimates that, on a stand-alone basis (no financial contagion overhang resulting in impaired market access), the company could be rated significantly higher than it is currently. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer (Opco) -- WTI oil prices of $57.50/bbl in 2019 and 2020, and $55/bbl in 2021 and the long term; -- Crack spreads that revert to inflation adjusted averages, adjusted for positive IMO impacts that peak in 2020; -- Capex of $325 million in 2019, which rises across the forecast to reflect increased internal reinvestment; -- Flat corporate SG&A expenses on a $/bbl basis; -- FCF peaks in 2020 in line with the first full year of IMO implementation, then drifts lower as industry adjustments occur. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Positive Rating Action CITGO Petroleum: -- Improved market access; -- Mid-cycle lease-adjusted FFO gross leverage below approximately 4.3x; -- Mid-cycle debt/EBITDA below 3.0x; -- Mid-cycle FFO fixed-charge coverage at or above approximately 3.3x. CITGO Holding -- Improved market access; -- Tighter notching relationship between Holdco and Opco; -- Mid-cycle lease-adjusted FFO gross leverage below approximately 6.0x; -- Mid-cycle debt/EBITDA below 4.8x; -- Mid-cycle FFO fixed charge coverage at or above approximately 2.4x; Developments That May, Individually or Collectively, Lead to Negative Rating Action CITGO Petroleum -- Deterioration in market access, including inability to refinance debt in event change of control clause is triggered; -- Mid-cycle lease-adjusted FFO gross leverage above approximately 5.5x; -- Mid-cycle debt/EBITDA above 4.1x; -- Weakening or elimination of key covenant protections in the CITGO senior secured debt documents. CITGO Holding -- Deterioration in market access, including inability to refinance debt in event change of control clause is triggered; -- Mid-cycle lease-adjusted FFO gross leverage approaching 7.5x; -- Mid-cycle debt/EBITDA approaching 6.5x; -- Weakening or elimination of key covenant protections in CITGO Holding senior secured debt documents; -- Failure to complete Holdco refinancing as contemplated. CONTINENTAL WHOLESALE: Unsecureds to Get $80K in Quarterly Payments ------------------------------------------------------------------- Continental Wholesale Diamonds LLC filed a Chapter 11 plan and accompanying disclosure statement proposing to pay General Unsecured Creditors, classified in Class 8, a pot plan of $80,000 without interest on a pro-rata basis in 20 equal quarterly installments with the initial payment commencing on the 90th day after the Effective Date of the Plan. Class 1 - Secured Claim of Kapitas Servicing Inc. (POC 20) are impaired. The secured claim will be paid with interest accruing at 6.75% over three (3) years. In the alternative, Debtor and Kapitas will agree to turnover collateral at an agreed costs basis, and subject to notice and Bankruptcy Court approval. Class 2 - Secured Claim of Synovus Bank (POC 5) are impaired. Class 2 represents the secured claim of Synovus Bank of 152,932.32 (proof of claim 5). Synovus Bank will retain its liens and the claim will paid on a fifteen year amortization at 5.98% interest, and a five year term. Monthly payments will be $1288.88 which will commence thirty days from the effective date. Class 3 - Secured Claim of Synovus Bank (POC 6) are impaired. Class 3 represents the secured claim of Synovus Bank of 255,724.22 (proofof claim 6). Synovus Bank will retain its liens and the claim will paid on a fifteen year amortization at 8% interest, and a five year term. Monthly payments will be $2443.83 which will commence thirty days from the effective date. Class 4 - Secured Claim of iHeart Media + Entertainment. Inc. (POC 8) are impaired. The claim will be treated as fully unsecured and will participate and receive a pro-rata distribution in Class 8. Class 5 - Secured Claim of Exclusive Diamonds. Inc. (POC 16) are impaired. The claim will be treated as fully unsecured and will participate and receive a pro-rata distribution in Class 8. Class 6 - Secured Claim of Mantis Funding LLC (POC 18) are impaired. The claim will be treated as fully unsecured and will participate and receive a pro-rata distribution in Class 8. Class 7 - Secured Claim of the Can Capital Asset Servicing. Inc. (POC 23) are impaired. The claim will be treated as fully unsecured and will participate and receive a pro-rata distribution in Class 8. Class 9 - Insider Claims are impaired. The Debtor will not make any distribution on claims of insiders or companies affiliated with current management for money loaned or goods sold. This includes proofs of claim numbers 26 and 27. Class 10 - Equity/Membership Interest of the Debtor are impaired. Existing equity will be cancelled and the equity in the reorganized debtor shall be placed in the current owner in exchange for $5,000 in readily available funds to the Debtor's DIP account on or before the effective date of the Plan. The Debtor will fund this Plan through the continued operation and cash flows of its retail and wholesale jewelry business. The Debtor will continue to be managed by current management. This Plan allows the Debtor to amortize and restructure various secured obligations in order to pay a significant dividend to unsecured creditors. A full-text copy of the Disclosure Statement dated July 10, 2019, is available at https://tinyurl.com/yyvqtfe5 from PacerMonitor.com at no charge. Attorney for the Debtor is James W. Elliott, Esq., at McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A., in Tampa, Florida. About Continental Wholesale Continental Wholesale -- https://www.continentalwholesalediamonds.com -- is a wholesale jewelry manufacturer that has previously sold exclusively to fine jewelry stores across the country. Continental Wholesale Diamonds now offers certified diamonds, engagement rings, wedding bands, diamond stud and hoop earrings and gold and silver designer jewelry at wholesale prices. Continental Wholesale Diamonds LLC filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 18-11002) on Dec. 24, 2018. In the petition signed by Andrew Meyer, authorized representative, the Debtor estimated $1 million to $10 million in assets and $1 million to $10 million in liabilities. The case is assigned to Judge Catherine Peek McEwen. The Debtor is represented by James W. Elliott, Esq. at McIntyre Thanasides BringGold. No official committee of unsecured creditors has been appointed in the Chapter 11 case. CORNERSTONE VALVE: Cameron Objects to Disclosure Statement ---------------------------------------------------------- Cameron International Corporation, A Schlumberger Company, objects to the Combined Plan and Disclosure Statement of Cornerstone Valve LLC. Cameron points out that the Disclosure Statement fails to contain certain information which is relevant to a decision by creditors of the Debtor in determining whether to vote for acceptance or rejection of the Debtor’s Combined Plan and Disclosure Statement and therefore fails to comply with the provisions of 11 U.S.C. Section 1125. Cameron asserts that the Disclosure Statement does not provide information as to whether the sale of the unnamed property by Gupta Management will provide payment to Bancorp South for any amount of the over secured creditor in Class 1 of the Plan. According to Cameron, the Disclosure Statement does not contemplate avoidable transactions and causes of action against insider Nitesh Gupta for withdrawals and distributions from the Debtors. Cameron complains that the Disclosure Statement does not contain sufficient information regarding the upcoming orders that the Debtors anticipate to be produced and the projection of the income from such orders to fund the plan for the next five years. A full-text copy of the Plan is available at https://tinyurl.com/y2qxnpve from Pacermonitor.com at no charge. Attorneys for Cameron: Maria M. Bartlett, Esq. Carl Dore, Jr., Esq. DORE LAW GROUP, P.C. 17171 Park Row, Suite 160 Houston, TX 77084 Tel: (281) 829-1555 Fax: (281) 200-0751 Email: mbartlett@dorelawgroup.net carl@dorelawgroup.net About Cornerstone Valve and Well Head Component Cornerstone Valve LLC -- http://www.cornerstonevalue.com/-- is a manufacturer of fabricated metal products. Well Head Component, Inc., which conducts business under the name Avsco, provides supply chain and project management services. It offers engineering, designing, and manufacturing services, as well as modification and logistics services. Well Head is an international OEM representative and distributor of industrial products for the most requested brands used by energy markets. Headquartered in Houston, Texas, Well Head has an in-country presence in Nigeria, Libya, UAE and most recently in Brazil and Italy. Cornerstone Valve and Well Head sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case Nos. 19-30869 and 19-30870) on Feb. 15, 2019. At the time of the filing, Cornerstone Valve estimated assets and liabilities of between $1 million and $10 million. Well Head estimated assets of between $1 million and $10 million and liabilities of less than $1 million. The cases are assigned to Judge Marvin Isgur. Sartaj Bal, PC, is the Debtors' bankruptcy counsel. CREDIT MANAGEMENT: Gets Court Approval to Hire OCP -------------------------------------------------- Credit Management Association Inc. received approval from the U.S. Bankruptcy Court for the District of Nevada to hire Diana Tsukiashi, a self-employed web developer, as an "ordinary course professional." Ms. Tsukiashi will provide front-end maintenance of company websites and will be paid an hourly fee of $20. Ms. Tsukiashi neither holds nor represents any interest adverse to the Debtor and its bankruptcy estate, according to court filings. About Credit Management Association Credit Management Association, Inc. -- http://creditmanagementassociation.org/-- is a non-profit association that has served business-to-business companies since 1883. CMA helps credit, collection, and financial decision-makers get the information and support they need to make fast, accurate credit decisions. In addition, CMA assists insolvent companies with workouts or liquidation through cost effective alternatives to bankruptcy. CMA has 800 members who pay a $495 annual fee for full membership or a $265 annual fee for an associate membership. It is headquartered in Las Vegas. CMA filed a Chapter 11 petition (Bankr. D. Nev. Case No. 18-16487) on Oct. 31, 2018. In the petition signed by Kimberly Lamberty, president and chief executive officer, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. Mike K. Nakagawa oversees the case. The Debtor hired Clark Hill, PLLC as reorganization counsel, and Kurtzman Carson Consultants, LLC as the claims and noticing agent. DAH UNIVERSITY: Seeks to Hire Timothy W. Gensmer zs Legal Counsel ----------------------------------------------------------------- DAH University Hospitality, LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Timothy W. Gensmer, PA as its legal counsel. The firm will assist the Debtor in the preparation of a plan of reorganization and will provide other legal services in connection with its Chapter 11 case. The firm received a retainer of $10,000, plus $1,717 for the filing fee. Timothy Gensmer, Esq., disclosed in court filings that no attorney employed by the firm holds interest that may be affected by its representation of the Debtor. The firm can be reached through: Timothy W. Gensmer, Esq. Timothy W. Gensmer, PA 2831 Ringling Blvd., Suite 202-A Sarasota, FL 34237 Tel: (941) 952-9377 Fax: (941) 954-5605 Email: timgensmer@aol.com tim@timgensmer.com About DAH University Hospitality DAH University Hospitality, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-05845) on June 20, 2019. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of less than $1 million. DANICA ASSOCIATES: Oct. 17 Hearing on Disclosure Statement ---------------------------------------------------------- The court has set a hearing to consider approval of the disclosure statement explaining the Chapter 11 Plan of Danica Associates, LLC, for October 17, 2019 at 1:30 PM, in United States Bankruptcy Court, Courtroom A, 8th Floor 1515 North Flagler Drive, West Palm Beach Florida 33401. The last day for filing and serving objections to the disclosure statement is on October 10, 2019. Objections to the disclosure statement must be filed and served at least 3 business days before the disclosure. About Danica Associates Danica Associates, LLC, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 18-12476) on March 2, 2018. In the petition signed by Rite K. Weller, managing member, the Debtor estimated at least $50,000 in assets and $100,000 to $500,000 million in liabilities. The case is assigned to Judge Paul G. Hyman, Jr. The Debtor is represented by David Lloyd Merrill, Esq. at Merrill PA. DATTA MANGLAM: Seeks to Hire Public Insurance Adjuster ------------------------------------------------------ Datta Manglam Hospitality, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire a public insurance adjuster. In an application filed in court, the Debtor proposes to employ Balance Companies, LLC to assist in the preparation, presentation and adjustment of claims for the loss or damage resulting from a fire in a property that it owns. The firm will get a 5 percent commission upon settlement and payment by the insurer on each claim. Allen Vise, a public insurance adjuster employed with Balance Companies, disclosed in court filings that he does not represent any interest adverse to the Debtor and its bankruptcy estate. Balance Companies can be reached through: Allen J. Vise Balance Companies, LLC 5005 Hidalgo St., Suite 504 Houston, TX 77056 About Datta Manglam Hospitality Datta Manglam Hospitality, LLC, owns a hotel located at 3334 S. US 77, Kingsville, Texas, valued by the company at $343,160. Datta Manglam Hospitality sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 19-31726) on March 29, 2019. At the time of the filing, the Debtor disclosed $414,335 in assets and $1,096,519 in liabilities. The case is assigned to Judge Eduardo V. Rodriguez. The Law Office of Margaret M. McClure is the Debtor's counsel. DIOCESE OF DULUTH: Plan Centers on $39.2MM Deal for Tort Claimants ------------------------------------------------------------------ The Diocese of Duluth and the Official Committee of Unsecured Creditors file a joint Chapter 11 plan of reorganization and accompanying Disclosure Statement based on two groups of settlements: 1. One group of settlements is among the Diocese, the Diocese Parties and the Settling Insurer Entities and amounts to $30,700,000. This settlement is evidenced by Insurance Settlement Agreements that have previously received Bankruptcy Court approval. In general terms, the Insurance Settlement Agreements provide for (a) the Settling Insurers' buy back of the Policies from the Diocese Parties and (b) injunctions which prohibit, amongst others, Tort Claimants from suing the Settling Insurer Entities. 2. The other settlement is among the Diocese, the Diocese Parties, and the Committee and amounts to $8,500,000. All settlements together provide that the Tort Claimants will receive the grand total sum of $39,200,000.00, which will be payable to the Trust set up through the Plan and Disclosure Statement process. In addition, a fund in the amount to be determined will be established to pay Unknown Tort Claimants pursuant to the Plan, the Trust Distribution Protocols and other Plan documents. Class 5 - General Unsecured Claims are impaired. The holders of Class 5 Claims shall receive, directly from the Reorganized Debtor, payment in full of such allowed Class 5 Claim, without interest, in two equal installments. The first installment shall be due within 90 days following the Effective Date. The second installment shall be due and payable within 180 days following the Effective Date. Class 3 - Tort Claims Other Than Unknown Tort Claims are impaired. Class 3 Claims shall be assigned to and assumed by the Trust. Each Class 3 Claim will be estimated solely for purposes of voting. The Protected Parties and the Settling Insurer Entities shall have no further liability in connection with Class 3 Claims. Class 4 - Unknown Tort Claims are impaired. Class 4 Claims shall be assumed by the Reorganized Debtor. The maximum amount of the Reorganized Debtor's obligation to pay Class 4 Claimants shall be determined by the Unknown Claims Representative in his report and recommendation which is incorporated by reference and attached to this Plan as Exhibit A. Class 6A - Abuse Related Contingent Claims are impaired. Class 6A Claims will receive no distribution under the Plan and will be channeled to the Trust. The treatment of Class 6A Claims shall include the release and certification procedures contemplated under Sections 4.3 and 4.4. Class 6B - Abuse Related Contingent Claims are impaired. Class 6B Claims will receive no distribution under the Plan and will be assumed by the Reorganized Debtor. The treatment of Class 6B Claims shall include the release and certification procedures contemplated under Sections 4.3 and 4.4. Within ten (10) days after the Settling Insurers receive written notice from the Debtor that the Conditions to Effectiveness set forth in Section 13.1 (a), (b), and (c) of the Plan have occurred, the Settling Insurers will make payments to its respective attorneys' trust accounts as follows: Within ten (10) days after the Settling Insurers receives written notice from the Debtor that all of the Conditions to Effectiveness set forth in Section 13.1 have occurred, the Settling Insurers shall cause its attorneys to pay to the Trust the $30,700,000.00 deposited in the attorney's trust account. The Debtor will fund the trust in the amount of $8,500,000.00 within ten (10) days after all the conditions to effectiveness set forth in Article IX have occurred. A full-text copy of the Joint Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/yybu29gk from PacerMonitor.com at no charge. Attorneys for the Debtor are Phillip Kunkel, Esq., at Gray Plant Mooty, in St. Cloud, Minnesota; and J. Ford Elsaesser, Esq., and Bruce A. Anderson, Esq., at Elsaesser Anderson CHTD, in Coeur d'Alene, Idaho. Attorneys for the Committee are Robert T. Kugler, Esq., Edwin H. Caldie, Esq., and Andrew J. Glasnovich, Esq., at Stinson, LLP, in Minneapolis, Minnesota. About Diocese of Duluth The Diocese of Duluth is headquartered in Duluth, Minnesota. It covers northern Minnesota parishes and 10 counties with Cass to the west, Koochiching to the north, Cook to the east and Pine to the south. The Diocese of Duluth sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Minn. Case No. 15-50792) on Dec. 7, 2015. The case is assigned to Judge Robert J Kressel. The Debtor's lead counsel is Bruce A Anderson, Esq., and J Ford Elsaesser, Esq., at Elsaesser Jarzabek Anderson Elliott & MacDonald, CHTD., in Zandpoint, Idaho. The Debtor's local counsel is Phillip Kunkel, Esq., at Gray, Plant, Mooty, Mooty & Bennett, P.A., in St Cloud, Minnesota. Brad Wadsten of Edina Realty (Wadsten) was tapped as real estate broker. In its petition, the Debtor estimated $1 million to $10 million in both assets and liabilities. The petition was signed by Rev. James Bissonette, vicar general. DRYDEN 68: Moody's Assigns Ba3 Rating on $21.5MM Class E Notes -------------------------------------------------------------- Moody's Investors Service assigned ratings to two classes of notes issued by Dryden 68 CLO, Ltd. Moody's rating action is as follows: US$325,000,000 Class A Senior Secured Floating Rate Notes Due 2032 (the "Class A Notes"), Assigned Aaa (sf) US$21,500,000 Class E Junior Secured Deferrable Floating Rate Notes Due 2032 (the "Class E Notes"), Assigned Ba3 (sf) The Class A Notes and the Class E Notes are referred to herein, collectively, as the "Rated Notes." RATINGS RATIONALE The rationale for the ratings is based on a consideration of the risks associated with the CLO's portfolio and structure as described. Dryden 68 is a managed cash flow CLO. The issued notes will be collateralized primarily by broadly syndicated senior secured corporate loans. At least 90% of the portfolio must consist of first lien senior secured loans and up to 10% of the portfolio may consist of second lien loans and unsecured loans. The portfolio is approximately 74% ramped as of the closing date. PGIM, Inc. will direct the selection, acquisition and disposition of the assets on behalf of the Issuer and may engage in trading activity, including discretionary trading, during the transaction's five year reinvestment period. Thereafter, subject to certain restrictions, the Manager may reinvest unscheduled principal payments and proceeds from sales of credit risk assets. In addition to the Rated Notes, the Issuer issued three other classes of secured notes and one class of subordinated notes. The transaction incorporates interest and par coverage tests which, if triggered, divert interest and principal proceeds to pay down the notes in order of seniority. Moody's modeled the transaction using a cash flow model based on the Binomial Expansion Technique, as described in Section 2.3.2.1 of the "Moody's Global Approach to Rating Collateralized Loan Obligations" rating methodology published in March 2019. For modeling purposes, Moody's used the following base-case assumptions: Par amount: $500,000,000 Diversity Score: 80 Weighted Average Rating Factor (WARF): 3005 Weighted Average Spread (WAS): 3.30% Weighted Average Coupon (WAC): 7.50% Weighted Average Recovery Rate (WARR): 47.5% Weighted Average Life (WAL): 9.01 years s Methodology Underlying the Rating Action: The principal methodology used in these ratings was "Moody's Global Approach to Rating Collateralized Loan Obligations" published in March 2019. Factors That Would Lead to an Upgrade or Downgrade of the Ratings: The performance of the Rated Notes is subject to uncertainty. The performance of the Rated Notes is sensitive to the performance of the underlying portfolio, which in turn depends on economic and credit conditions that may change. The Manager's investment decisions and management of the transaction will also affect the performance of the Rated Notes. EMPIRE GENERATING: Minority Lenders Object to Plan Confirmation --------------------------------------------------------------- ASSF IV AIV B Holdings III, L.P., and AEIF TRADE, LLC, and SPT Infrastructure Finance Sub-1, LLC and SPT Infrastructure Finance Sub-2, Ltd. (the "Minority Lenders") object to the confirmation of the Amended Joint Chapter 11 Plan of Empire Generating Co, LLC, and its debtor affiliates. The Minority Lenders ask the Court not to confirm the Plan because the Plan fails to satisfy multiple confirmation requirements, including because it: (a) impairs claims arising under the Prepetition Loan Documents without giving holders of those claims an opportunity to vote to accept or reject the Plan; (b) provides impermissible non-consensual third party releases in the form of (i) cancellation of the Prepetition Loan Documents and (ii) overly broad exculpation and injunction provisions that function as a non-consensual third party release; (c) provides for releases by the Debtors that are not only unsupported by any factual basis, but also are tainted by self-dealing; (d) was not proposed in good faith; and (e) does not classify the Credit Agreement Claims as required by sections 1122 and 1123 of chapter 11 of title 11 of the United States Code, 11 U.S.C. Sections 101–1532. According to the Minority Lenders, none of the Released Parties contributed "substantial financial and non-financial consideration" that "no other party could have done," agreed to rework transactions initially contemplated as part of the restructuring when creditor feuding made it impossible to confirm the originally bargained-for plan, or funded cash available for distribution to unsecured creditors in settlement of highly non-consensual third party release sought through cancellation of the Prepetition Loan Documents is not necessary to the Debtors' reorganization. The Minority Lenders point out that the Debtors are releasing claims against their officers, directors, and prepetition equity sponsors without conducting any investigation into claims and causes of action that the Debtors may have against such parties. The Minority Lenders assert that the Debtors have failed to meet their burden of demonstrating that the Debtor Release is fair and equitable and in the best interests of the Debtors’ estates, the Plan should be denied. The Minority Lenders complain that the Debtors did not omit the Credit Agreement Claims from the Plan due to any dispute regarding the existence of the Credit Agreement Claims against Debtors Holdings, Holdco, and Empire. Counsel to ASSF IV AIV B Holdings III, L.P., and AEIF TRADE, LLC: James H.M. Sprayregen, P.C., Esq. Brian E. Schartz, P.C. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, NY 10022 Tel: (212) 446-4800 Fax: (212) 446-4900 -- and -- Anup Sathy, P.C., Esq. Stephen C. Hackney, P.C., Esq. Alexandra Schwarzman, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Chicago, IL 60654 Tel: (312) 862-2000 Fax: (312) 862-2200 Counsel to SPT Infrastructure Finance Sub-1, LLC and SPT Infrastructure Finance Sub-2, Ltd: Steven M. Abramowitz, Esq. Marisa Antos-Fallon, Esq. VINSON & ELKINS LLP 666 Fifth Avenue, 26th Floor New York, NY 10103-0040 Tel: (212) 237-0000 Fax: (212) 237-0100 About Empire Generating Empire Generating Co LLC engages in the generation and sale of natural gas fired electricity in New York. It owns and operates a power plant in Rensselaer, New York. Empire Generating is ultimately owned by non-debtor TTK Power, LLC, which in turn is indirectly owned by three sponsors: Tyr TTK Power, LLC ("Tyr"), KPIC USA, LLC ("Kansai") and TG TTK Power, LLC. Empire Generating Co, LLC, Empire Gen Holdco, LLC, Empire Gen Holdings, LLC, and TTK Empire Power, LLC sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 19-23007) on May 19, 2019. Empire Generating estimated assets and liabilities of $100 million to $500 million as of the bankruptcy filing. The Hon. Robert D. Drain is the case judge. The Debtors tapped Hunton Andrews Kurth LLP and Steinhilber Swanson LLP as counsel; RPA Advisors as financial advisor and OMNI Management Group, Inc. as claims agent. EMPRESAS CARRION: Oriental Bank Objects to Disclosure Statement --------------------------------------------------------------- Oriental Bank objects to the confirmation of the Plan of Reorganization and adequacy of the Disclosure Statement filed by Empresas Carrion Allende, Inc. Oriental complains that the proposed amount to be paid does not cover the amount that was lent to the Debtor and it constitutes a considerable reduction of the debt without a base for justification. Oriental points out that the Debtor does not have the necessary use permits to operate the commercial properties. According to Oriental, the Debtor then attempts to restructure the repayment of the secured loan, but fails to reaffirm the mortgages and collateral, attempting to release the properties after it complies with the plan provisions. Oriental asserts that the Disclosure Statement does not provide any information whatsoever as to the Debtor's liquidity or financial capacity to make the required capital contributions and investments within the time frame contemplated in the Plan. Counsel for Oriental Bank: Cristina A. Fernandez Rodriguez, Esq. MCD LAW LLC PO BOX 191732 SAN JUAN PR 00919-1732 Tel: (787) 200-7876 Email: caf@mcdlawllc.com About Empresas Carrion Allende Empresas Carrion Allende, Inc., operates a grocery store in Arecibo, Puerto, Rico. Empresas Carrion Allende filed its petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 18-07111) on Dec. 6, 2018. In the petition was signed by Sandra I. Carrion Montalvo, president, the Debtor estimated $1 million to $10 million in both assets and liabilities. The case is assigned to the Hon. Mildred Caban Flores. Francisco J. Ramos Gonzalez, Esq. at Francisco J. Ramos & Asociados CSP, led by Francisco J. Ramos Gonzalez, is the Debtor's counsel. F & S ASSOCIATES: Proposes to Sell Property to Pay Creditors ------------------------------------------------------------ F & S Associates Limited Partnership filed a Chapter 11 Plan and accompanying disclosure statement proposing to pay creditors from Available Cash from the sale of the real property at 9190 Red Branch Road, Columbia, Maryland. The Debtor has retained Cris Abramson and G&E Real Estate, Inc., d/b/a Newmark Knight Frank, to market the Property for sale. The Debtor in good faith believes that the Property is worth $3.5 to $3.6 Million based on comparable sales on a per acre basis and/or based on a FAR (Floor Area Ratio) basis. On June 18, 2019, the Debtor and a purchaser executed a Letter of Intent to sell the Property to Nichols Contracting for $3,300,000 million payable as follows: an initial payment of $2,500,000 paid in cash at closing and a second payment of $800,000 payable within 32 months. The second payment of $800,000 shall be secured Note from the members of the Purchaser, an Indemnity Deed of Trust in second position on the Property from the new owner. The loan will be guaranteed by the Purchaser. It is expected that a final contract for the sale of the Real Property to Nichols Contracting will be fully executed by no later than the middle of July 2019. It is the Debtor's expectation that the initial payment of $2,500,000 will be sufficient to pay the Class 1 and Class 2 claims in the case in full and make a substantial payment to the Class 3 claim.. Class 7 - Allowed General Unsecured Claims are impaired. Each holder of an Allowed Class 7 Claim shall receive a Pro Rata distribution from Available Cash until such Allowed Class 7 Claims are paid in full. Class 2 - Allowed Secured Claim of Red are impaired. The Allowed Class 2 Claim shall be paid in full, including the legal interest rate, from Available Cash. Class 4 - Oakland Ridge Industrial Development Corporation are impaired. The Allowed Class 4 Claim shall be paid in full from Available Cash. In the event the Available Cash is insufficient to pay the Allowed Class 4 Claim in full, any shortfall shall treated as a Class 7 Claim. Class 5 - Howard County-Citation Claim are impaired. The Allowed Class 5 Claim shall be paid in full to the extent of Available Cash. In the event the Available Cash is insufficient to pay the amount of the Allowed Class 5 Claim in full, the unpaid balance of the Class 5 Claim shall be treated as a Class 7 Claim. Class 6 - Samjord Partners are impaired. The Allowed Class 6 Claim shall be paid to the extent of Available Cash. In the event the amount of the Class 6 Claim is not paid in full, the unpaid balance shall be treated as a Class 7 Claim. Class 8 - Insider Claims are impaired. The Class 8 creditors, listed in Exhibit 1 to the Plan, will share Pro Rata any Available Cash remaining after payment of Allowed Claims in Classes 1-7. Class 9 - Equity Claims are impaired. The holder of the Equity Interest shall not be entitled, and shall not receive, any distribution of Available Cash on account of such Equity Interest under the Plan until holders of all Allowed Claims have been paid in full as provided under the Plan. A full-text copy of the Disclosure Statement dated July 10, 2019, is available at https://tinyurl.com/y3gw28l7 from PacerMonitor.com at no charge. Counsel to the Debtor is Michael Coyle, Esq., at The Coyle Law Group LLC, in Columbia, Maryland. About F & S Associates LP F & S Associates Limited Partnership based in Columbia, MD, filed a Chapter 11 petition (Bankr. D. Md. Case No. 19-14947) on April 11, 2019. In its petition, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. David E. Rice oversees the case. The Coyle Law Group LLC serves as bankruptcy counsel to the Debtor. FAITH MISSIONARY: Fidelity Bank Objects to Disclosure Statement --------------------------------------------------------------- The Fidelity Bank, a secured creditor, objects to the approval of the Disclosure Statement explaining the Chapter 11 Plan of Faith Missionary Baptist Church, fka Missionary Faith Baptist Church. The Fidelity Bank does not consent to the proposed modification of the contractual. The Fidelity Bank points out that the Debtor’s proposed plan does not comply with 11 U.S.C. Section 1129(b)(2)(A)(ii) in that it does not provide The Fidelity Bank with an "indubitable equivalent" of its claim. The Fidelity Bank further points out that since the inception of the Debtor's loan 19 years ago, Debtor has established a record of inadequate income to pay monthly payments to The Fidelity Bank. According to the Fidelity Bank, the Debtor's plan has not been proposed in good faith as required by 11 U.S.C. Section 1129(a)(3) in that the Debtor must show that there is a reasonable likelihood that the plan will achieve a result consistent with the standards prescribed by the code. The Fidelity Bank asserts that Debtor's plan provides for liquidation of the subject real property pledged to Bank. Attorney for the Bank: Theodore A. Nodell, Jr., Esq. Nodell, Glass & Haskell, L.L.P. 5540 Centerview Drive, Suite 416 Raleigh, NC 27606 Tel: (919) 821-2600 About Faith Missionary Baptist Church Based in Fuquay Varina, North Carolina, Faith Missionary Baptist Church, fka Missionary Faith Baptist Church -- https://www.faithmissionarync.com/ -- filed a voluntary Chapter 11 Petition (Bankr. E.D.N.C. Case No. 18-05775) on November 30, 2018. The Debtor is represented by Jason L. Hendren, Esq., and Rebecca F. Redwine, Esq., at Hendren Redwine & Malone, PLLC, Raleigh, North Carolina. At the time of filing, the Debtor had total assets of $1,707,416 and total liabilities of $518,811. The petition was signed by Anthony Farrar, chairman of the Board. FARROW GROUP: Chemical Bank Objects to Disclosure Statement ----------------------------------------------------------- Chemical Bank, a secured creditor and party in interest, objects to the confirmation of the Combined Plan and Disclosure Statement of Farrow Group, Inc. The Bank points out that the Debtor's proposed Plan is unconfirmable because the Debtors cannot satisfy Section 1129(a)(11) of the Bankruptcy Code based on the foregoing monthly Plan payment amounts, the operating expenses projected to be incurred by the Debtor and the historical income received by the Debtor since the Petition Date. The Bank further points out that the Plan discriminates unfairly against Chemical Bank's secured claim because the Plan proposes to pay Chase's secured claim in full over a longer period -- 66 months -- than the periods over which some of the other secured-claim classes will be paid in full. According to the Bank, the longer payment period for Chemical Bank allocates to Chemical Bank a materially greater risk in connection with its proposed distribution than the risk facing the TCF and Caterpillar secured claim classes. The Bank asserts that the Plan proposes in Section 3.2.1. to pay Chemical Bank's secured claim over a 66-month year term, even though it is questionable whether the machinery, equipment and vehicles securing Chemical Bank's claim have remaining useful lives of at least 66 months, especially after being subjected to normal depreciation and the Debtor’s heavy demolition and excavation activities. The Bank complains while Section 5.2 of the Plan indicates that a Creditor shall retain its lien(s) securing its Secured Claim until such time that its Secured Claim is satisfied, in order to clarify and avoid any ambiguity, the Plan should provide that Chemical Bank's Claim is secured by all of the Debtor's and Reorganized Debtor's existing and after-acquired personal property and proceeds thereof, and that Chemical Bank shall retain such security interests and liens until its secured claim is paid in full. The Bank points out that the Plan does not provide a default clause with respect to Chemical Bank's Claim. The Bank further points out that to make it clear and unambiguous that the Plan provisions apply to and are not intended to distinguish between the "Debtor" and the "Reorganized Debtor," the Plan should provide that all references to the "Debtor" in the Plan shall include and be binding upon the Debtor and the Reorganized Debtor. Attorneys for Chemical Bank: G. Timothy Moore, Esq. Moore Penna & Associates PLLC 38600 Van Dyke Ave., Suite 300 Sterling Heights, MI 48312 Phone: (586) 883-6585 About Farrow Group Farrow Group, Inc., a demolition contractor based in Detroit, Michigan, filed for chapter 11 bankruptcy protection (Bankr. E.D. Mich. Case No. 19-41009) on Jan. 24, 2019, with estimated assets of $0 to $50,000 and estimated liabilities of $1 million to $10 million. The petition was signed by Michael Farrow, president. FCH MCKINNEY: Taps Conine Realty Advisors as Realtor ---------------------------------------------------- FCH McKinney Senior Homes LLC received approval from the U.S. Bankruptcy Court for the Eastern District of Texas to hire Conine Realty Advisors, Inc. The Debtor tapped the firm in connection with the sale of 36 residential lots it owns. Meg Conine, a realtor and the sole owner of Conine Realty, will receive a 3 percent sales commission for her services. Conine Realty can be reached through: Meg Conine Conine Realty Advisors, Inc. 5220 Spring Valley Road Dallas, TX 75254 About FCH McKinney Senior Homes FCH McKinney Senior Homes, LLC, operates an assisted living facility in Dallas, Texas. FCH McKinney filed as a Domestic Limited Liability Company in the State of Texas on April 10, 2013, according to public records filed with Texas Secretary of State. FCH McKinney filed a Chapter 11 petition (Bankr. E.D. Tex. Case No. 18-42734) on Dec. 3, 2018. In the petition signed by Kent C. Conine, manager, the Debtor disclosed less than $50,000 in assets and less than $10 million in estimated liabilities. The Debtor is represented by Larry Kent Hercules, Esq., at Larry K. Hercules, Attorney At Law. FLO-TECH INC: Aug. 27 Plan Confirmation Hearing ----------------------------------------------- The Disclosure Statement explaining the Chapter 11 Plan filed by Flo-Tech, Inc., and Thomas Tedford is approved. The hearing to consider the confirmation of the plan shall be held at the United States Bankruptcy Court, 230 N. First Avenue, 7th Floor, Courtroom 701, Phoenix, Arizona on August 27, 2019 at 11:00 a.m. Ballots accepting or rejecting the plan must be received by the Plan Proponent at least seven (7) days prior to the hearing date set for the confirmation of the plan. The last day for filing with the Court and serving written objections to confirmation of the plan is fixed at fourteen (14) days prior to the hearing date set for confirmation of the plan. About Flo-Tech, Inc. Formed in December 1994, Flo-Tech, Inc., is in the business of providing concrete floor repair, restoration and refinishing services. Flo-Tech has its principal place of business located in Phoenix, Maricopa County, Arizona. Thomas Tedford is the president, director and majority shareholder of Flo-Tech -- he owns 100% of the outstanding shares in Flo-Tech Flo-Tech, Inc., filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 19-00460) on Jan. 15, 2019. The Debtor engaged Keery McCue, PLLC, as counsel. FREDERICKSBURG EDA: Fitch Rates $24.7MM 2019B Revenue Bonds 'B-' ---------------------------------------------------------------- Fitch Ratings has assigned a 'B-' rating to approximately $24.7 million of the Economic Development Authority (EDA) of the City of Fredericksburg, VA's revenue bonds, taxable series 2019B. The Rating Outlook for the 2019B bonds is Stable. KEY RATING DRIVERS The 'B-' rating on the 2019B bonds reflects the comparably weaker league strength of Minor League Baseball and the weaker franchise strength of the Potomac Nationals who are relocating to a new market in Fredericksburg, compared with Fitch's other professional sports league, franchise and facility ratings. Minor League Baseball and its clubs have a long and relatively stable history, but the project faces uncertainties related to the new location of the ballpark, an unproven track record of renewals associated with key revenue and a lack of demonstrated operations. While initial ticket, suites, sponsorships and other revenue sales have been positive, the lack of history is a rating constraint. Further, renewals risks are exacerbated by the 25-year maturity and minimal additional structural protections in the event of a material decline in revenues or constrained financial operations. These are partially mitigated by a 2.0x distribution test; however, significant distributions are projected over the first 10 years, with sponsor case DSCR metrics projected at above 3.0x, exposing bondholders to longer-term operational risks. Low Complexity, Moderate Contingency: Completion Risk: Midrange Fitch's midrange assessment of completion risk for the new proposed ballpark project reflects the project's contractor, security package and limited complexity. The completion analysis reflects L.F. Jennings' (the contractor) credit quality, guaranteed maximum price (GMP) contract and demonstrated history of delivering projects. The construction security includes solid liquid security ($2 million in bond proceeds for liquidity and contingency, $22 million "hard stadium" construction cost, $34 million total project costs) and 100% payment and performance bonds (provided by an 'AA' rated insurance company), as well as capitalized interest for six months beyond expected completion, with additional support from a construction contingency reserve account. The project is assumed to have a 10-12 month construction period, aiming for opening day on April 23, 2020 for games, and relatively overall low complexity of the construction. The construction does not assume any major new or technologically complicated elements that would be viewed as additional constraining factors. Fitch was provided an independent evaluation of the proposed construction cost estimate and construction schedule. Downey and Scott, LLC (Construction Management Services) opined on the adequacy of contingencies, budget and timing. Long League History but Small Base: Revenue Risk: League Business Model - Weaker While the Carolina League and other Class-A Advanced affiliates of Minor League Baseball leagues have a long history, the size of the league and game day attendance is significantly smaller than other professional leagues and other AA and AAA baseball leagues. Minor league baseball has a significant track record of local support in established markets and the Potomac Nationals track similarly to peers in relation to historical attendance. Fitch notes that all player costs are an obligation of the Major League Baseball Team (typically the largest expense line of a professional franchise), which precludes financial pressure on the Minor League team but also demonstrates the lack of control by the Minor League affiliate. Stable History and Support: Revenue Risk: Franchise Strength - Weaker The Potomac Nationals have a long history of support and an affiliation agreement with the Washington Nationals, albeit subject to future renewals. While the initial support from Fredericksburg has been strong, the impending move presents uncertainties related to medium-to-long fan support for game day ticket sales, corresponding game day revenues such as food and beverage and parking as well as corporate support for suites and sponsorships over the debt term. While a relatively limited risk, the team is subject to renewals of future affiliation agreements that could weaken support. New Facility, Not Overly Complex: Infrastructure Development and Renewal: Midrange Given the overall limited complexity of the stadium, near- to medium-term capex are expected to be limited. However, as with all sports facilities, maintaining the fan experience and value to corporate sponsorships is key to long-term interest and attendance levels. To the extent that excess cash flow from operations is less than anticipated, the ability to fund capital needs in the future to maintain interest may be constrained. Long-Dated, Senior Amortizing Debt: Debt Structure: Midrange While the debt structure is senior in ranking, amortizing and level, the 25-year maturity is a risk to this transaction and an outlier amongst Fitch-rated sports facilities. Covenants are adequate, including a cash-funded DSRF at MADS, a 2.0x distribution lockup test and limitations on additional borrowing, but there are limited additional bondholder protections in the event financial performance does not meet expectations. Financial Profile The Sponsor case projects revenues of $10 million in the 2021 season and EBITDA of $6 million (60% margin, stabilizing around 56% over the 10 year forecast), with average DSCR of around 3.0x for the forecast. Revenues increase to $10.8 million by 2029 (0.9% CAGR) while expenses grow at a 1.9% CAGR, resulting in EBITDA growth at a 0.2%. Fitch's base and rating cases apply various sensitivities to attendance and other key revenues including sponsorship and suite renewal rates, as well as operational expense sensitivities. EBITDA under the Fitch base case is flat through 2044 with average/minimum DSCR of 2.0x/1.7x, while under the rating case higher expense growth and lower renewals result in a -0.1% EBITDA CAGR and average/minimum DSCR of 1.7x/1.5x. PEER GROUP There are no direct peers rated in the single 'B' category rated publicly by Fitch. Fitch publicly rates league-wide borrowing programs in the 'A' category secured by long-term contractually obligated media contracts with a long-history of renewals and a proven, widespread media audience. Fitch publicly and privately rates professional sports league stadium and arena projects in the 'BBB' and 'BB' categories. Facilities in the 'BBB' category include facilities and franchises with midrange or stronger league assessment scores combined with a long-demonstrated history of fan and corporate support with conservative debt structures. 'BB' category professional facilities include more midrange attribute assessment scores with moderate levels of financial flexibility compared with peers in the 'BBB' category. While the Fredericksburg Stadium benefits from some league oversight through Minor League Baseball, the lack of proven track record of support in the new market limits the initial rating. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Negative Rating Action: - A substantial delay in completion beyond the capitalized interest period or meaningful cost overruns without timely mitigating actions from either the city or the baseball team's ownership; - Lower than anticipated attendance driving ticket revenues, or higher initial operating expenses, as Fitch has witnessed on other projects, leading to material lower financial flexibility and debt service coverage ratios; - Weak financial performance leading to DSCR below the rate covenant (1.75x) on a sustained basis; - Over the medium-to-longer term, a material reduction in renewal levels or price that leads to continued strained financial flexibility. Future Developments That May, Individually or Collectively, Lead to Positive Rating Action: - A demonstrated track record of operations and stable attendance combined with a positive renewal cycle associated with sponsorships and suites may lead to positive rating migration; however, the rating is predominately capped in the 'B' category given the league and franchise assessments combined with the 25-year maturity. TRANSACTION SUMMARY The EDA of the City of Fredericksburg, VA expects to issue approximately $39.85 million of bonds consisting of $15.2 million taxable series 2019A bonds (City Use Revenues) (BBB+/Stable) and $24.7 million taxable series 2019B (Stadium Revenues) (B-/Stable), in support of the total project costs associated with the new ballpark project. The EDA will loan proceeds of the Series 2019 bonds to SAJ Baseball LLC, a Virginia limited liability company, to fund the design, engineering, acquisition, development, construction and equipping of a new multi-purpose minor league baseball stadium to be located in the City of Fredericksburg. SAJ will own and operate the stadium and surrounding parking and maintenance facilities. The stadium will be the new home for Minor League Baseball's Potomac Nationals (to be renamed the Fredericksburg Nationals). The Potomac Nationals are the Class-A Advanced affiliate of Major League Baseball's Washington Nationals and play in the Carolina League of Minor League Baseball. The stadium is expected to have a total capacity of approximately 8,500, with fixed seating of 5,000 for games, including 13 suites accommodating up to 25 people each, a 250-person club/restaurant that is intended to be open year-round and other premium seating options and premium spaces. The Stadium is expected to have a 360-degree walk-around concourse with a range of permanent and temporary concession options and fan experience amenities. Fitch Cases The team sponsors have prepared a 10-year financial pro-forma case, reflecting revenues of $9.9 million in the 2020 season and CFADS of $5.9 million. Revenues under the sponsor case are derived approximately 41% from ticket sales, 25% from sponsorships and advertising (including naming rights), and 16% from concessions, with the remainder from parking, non-baseball events and other sources. Revenues increase by a 0.9% CAGR to $10.8 million by 2029, while expenses grow at a 1.9% CAGR, resulting in EBITDA growth at a 0.2% CAGR, resulting in average debt service coverage of around 3.0x over the forecast. Fitch's Base and Rating cases apply various sensitivities to attendance, ticket sales, sponsorship and suite renewal rates, concessions, parking, and non-baseball events revenue sources. In order to reflect the lack of historical operating expenses and Fitch's observations for initial years of stadium operations to exceed the budget, the Fitch base case increases expenses by 10% over the sponsor case in the initial year, while the Fitch rating case increases costs by 25% over the sponsor case. Thereafter, costs under the Fitch cases escalate by around 3% per year. The base and rating cases reflect a haircut of between 5% and 15% for major revenue sources including naming rights (not yet finalized), suite renewals (following expiration of the current five-year contracts) and sponsorships/advertising. Fitch's Base case generates revenues of $8.7 million for the 2021 season and EBITDA of $4.3 million (reflecting a 49% operating margin, stabilizing at around 43% over the long term). DSCR averages 2.0x over the forecast (excluding outliers), with a minimum DSCR of 1.7x. Fitch's rating case further sensitivities other event revenues, resulting in revenue of $8.2 million in the 2021 season and EBITDA of $3.2 million (with EBITDA margin stabilizing around 40%). DSCR averages 1.7x with a minimum of 1.5x while leverage remains above 5x through year 10. Fitch also ran a sensitivity to assess a reduced ticket sales and attendance environment, making an approximately 33% haircut off the sponsor case for ticket sales and other attendance driven revenues, which results in average DSCR of 1.1x over the debt term, and minimum DSCR of 0.9x. Asset Description Fredericksburg, population 28,360, is an independent city in the Northern Virginia region located on Interstate-95 approximately 50 miles south of Washington, D.C. and 50 miles north of Richmond, VA. The Potomac Nationals are a Minor League Baseball (MiLB) team that competes in the Class A-Advanced Carolina League, currently affiliated with the Washington Nationals. Security The 2019B bonds are secured by the net revenues generated from the operation of the stadium project. Further structural protections include a non-relocation agreement, as well as a lien on the leasehold deed of trust for the stadium. HAMLETT ENTERPRISES: U.S. Trustee Objects to Disclosure Statement ----------------------------------------------------------------- Gregory M. Garvin, the Acting United States Trustee, objects to the approval of the proposed disclosure statement explaining the Chapter 11 Plan of Hamlett Enterprises, Inc. According to the U.S. Trustee, the Disclosure Statement should be amended to provide more detail on the embezzlement of Walter Soper, including the amount embezzled, the time frame for the embezzlement, the prospects for stabilizing revenues after the embezzlement and what steps, if any, are being taken to assert a claim against Mr. Soper. The U.S. Trustee asserts that the Disclosure Statement fails to include a summary of historical earnings and expenses against which the pro forma can be compared. The U.S. Trustee points out that the plan does not include a class of equity holders but Ms. Soper owns 100% of the membership interests. About Hamlett Enterprises Based in Salmon, Idaho, Hamlett Enterprises, Inc., filed a petition under Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No. 18-41169) on Dec. 14, 2018, estimating under $1 million in both assets and liabilities. Maynes Taggart PLLC, led by Robert J. Maynes, is the Debtor's counsel. HAPPY FACES CHILDCARE: Seeks to Hire Bankruptcy Attorney -------------------------------------------------------- Happy Faces Childcare & Learning Center Inc. seeks approval from the U.S. Bankruptcy Court for the District of New Jersey to hire a bankruptcy attorney. In an application filed in court, the Debtor proposes to employ Michael Mclaughlin, Esq., to give legal advice regarding its powers and duties under the Bankruptcy Code and will provide other services in connection with its Chapter 11 case. Mr. Mclaughlin is "disinterested" as defined in Section 101(14) of the Bankruptcy Code, according to court filings. About Happy Faces Childcare & Learning Center Inc. Happy Faces Childcare & Learning Center Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. N.J. Case No. 19-22093) on June 18, 2019. At the time of the filing, the Debtor had estimated assets of less than $100,000 and liabilities of less than $500,000. The case is assigned to Judge Christine M. Gravelle. JOE'S PLACE: Unsecured Creditors to Get 10% Over 60 Months ---------------------------------------------------------- Joe's Place of the Bronx NY, Inc., filed a Chapter 11 plan and accompanying disclosure statement proposing that holders of General Unsecured Claims, which are impaired, will be paid 10% of allowed claims over 60 months from the Effective Date in monthly payments of $235.00. Class 1: Secured and Priority Tax Claims of the NYSDTF are impaired and will be paid a monthly payment of $4,500.00 a month for 72 months from Effective Date. Payments and distributions under the Plan will be funded by the Debtor's net income from the operation of its restaurant. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y2wyk57m from PacerMonitor.com at no charge. Attorney for the Debtor is Norma E. Ortiz, Esq., at Ortiz & Ortiz, L.L.P., in Astoria, New York. About Joe's Place of the Bronx, NY, Inc. Joe's Place of the Bronx, NY, Inc. filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y.. Case No. 17-11542) on June 2, 2017. The Hon. Martin Glenn presides over the case. Ortiz & Ortiz, LLP, represents the Debtor as counsel. In its petition, the Debtor estimated $50,000 to $100,000 in assets and $1 million to $10 million in liabilities. The petition was signed by Jose L. Torres, president. LIQUIDNET HOLDINGS: S&P Upgrades ICR to 'BB-' on Criteria Update ---------------------------------------------------------------- S&P Global Ratings raised its issuer credit and senior secured debt ratings on Liquidnet Holdings Inc. to 'BB-' from 'B+' and removed them from under criteria observation. The outlook is positive. The upgrade reflects the firm's maintenance of liquidity at its holding company and unregulated subsidiaries typically in excess of a year and a half of its debt service obligations (interest and amortization). Because S&P believes this limits exposure to potential regulatory interference in dividends from its regulated brokerage subsidiaries to the debt-issuing nonoperating holding company, it now only notch the holding company ratings down one notch from group credit profile instead of two. Liquidnet is a leading alternative trading system (ATS) provider whose core business is facilitating large block equity trades primarily for its well-diversified customer base of buy-side institutional investors. Thanks to its large liquidity pool, Liquidnet typically has the largest average negotiated execution size per trade in the U.S. Liquidnet market share in Europe increased in 2018 at least partially because of the implementation of Markets in Financial Instruments Directive (MiFID) II, which allowed it to compete for a much larger commission wallet than was previously accessible. The positive outlook continues to reflect the potential for continued development of the firm's algorithmic and fixed-income trading businesses to bolster the firm's competitive position and improve earnings. S&P said, "We expect the firm to maintain excess liquidity at the holding company sufficient to meet debt service obligations. We expect no material increase in debt or capital distributions. We also expect expenses to increase in 2019 as Liquidnet continues to invest and hire to build its business." S&P said, "We could raise the ratings over the next 12 months if the firm's algorithmic and other businesses continue to develop and provide diversification sufficient to meaningfully boost the level and stability of earnings. "We could revise the outlook to stable if leverage increases unexpectedly, with debt to EBITDA above 3x on a sustained basis. We could also revise the outlook to stable if performance deteriorates or if a material operational loss occurs." LIVE OUT LOUD: Trinity Creditors Object to Disclosure Statement --------------------------------------------------------------- Trinity Creditors object to the entry of an order approving the First Amended Disclosure Statement explaining the First Amended Chapter 11 Plan of Live Out Loud, Inc. The Trinity Creditors point out that the Amended Disclosure or any other document produced by the Debtor fails to identify and address the fluctuation in assets held by the Debtor. The Trinity Creditors assert that the Debtor failed to disclose this to the Court until more than a month after the Trinity Creditors raised the issue in Ms. Langemeier's deposition in the Debtor's Motion to Approve Marketing Plan. The Trinity Creditors submit that the Court should not approve the Disclosure Statement because it does not contain adequate information as that term is defined in Section 1125(a)(1) of the Bankruptcy Code for the Trinity Creditors to make an informed decision on the marketing plan or any eventual sale or offer for the Debtor. According to the Trinity Creditors, the Debtor has failed to produce any documents about this transfer that would allow the Trinity Creditors to assess the current financial condition of the Debtor or even to investigate possible claims against Ms. Langemeier and the Debtor for fraudulent transfers and other violations of the bankruptcy code based on these unilateral, unapproved transfers. The Trinity Creditors complain that the Debtor has utterly failed to provide adequate information about the Debtor's current operations, although based on the cursory reference to Integrated Wealth Systems it appears the Debtor is not actually operating. Attorney for Trinity Creditors: Jason S. Vanacour, Esq. VANACOUR PERKINS PLLC 14675 Midway Road, Suite 100 Addison, TX 75001 Tel: (972) 646-3999 Fax: (972) 476-1109 Email: jvanacour@vanacourperksin.com -- and -- Craig S. Dunlap, Esq. 10161 Park Run Drive, Suite 150 Las Vegas, NV 89145 Tel: (702) 996-7888 Fax: (702) 960-4074 Email: cdunlap@cdunlaplaw.com About Live Out Loud Live Out Loud, Inc. is a Nevada corporation which is in the business of providing financial seminars, consulting services, and other forms of financial advice. It is located at 195 Highway 50, Zephyr Cove, Nevada. Live Out Loud filed a chapter 11 petition (Bankr. D. Nev. Case No. 18-51074) on Sept. 26, 2018. In the petition signed by Loral Langemeier, president, the Debtor disclosed $70,515 in assets and $4,068,941 in liabilities. The case has been assigned to Judge Bruce T. Beesley. Alan R. Smith, Esq., at the Law Offices of Alan R. Smith, serves as the Debtor's counsel. MDMT CONSULTING: Seeks to Hire Richard Feinsilver as Attorney ------------------------------------------------------------- MDMT Consulting Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire Richard Feinsilver, Esq., as its attorney nunc pro tunc to Jan. 16. Mr. Feinsilver has been providing legal services to the Debtor since Jan. 16 in connection with its Chapter case. These services include negotiation with creditors and the preparation of a bankruptcy plan. The Debtor paid the attorney an initial retainer of $10,000, plus $1,717 for the filing fee. The attorney charges an hourly fee of $350 for his services. Mr. Feinsilver disclosed in court filings that he and his firm are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Mr. Feinsilver maintains an office at: Richard S. Feinsilver, Esq. One Old Country Road, Suite 125 Carle Place, NY 11514 Phone: 516-873-6330 Email: feinlawny@yahoo.com About MDMT Consulting Inc. Richard Feinsilver, Esq., as its attorney sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 19-70402) on Jan. 16, 2019. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of less than $500,000. The case is assigned to Judge Louis A. Scarcella. METHODIST UNIVERSITY: Fitch Cuts Rating on 2012 Bonds to BB+ ------------------------------------------------------------ Fitch Ratings has downgraded the rating on North Carolina Capital Facilities Finance Agency's approximately $15.4 million of series 2012 revenue bonds issued on behalf of Methodist University to 'BB+' from 'BBB'. Fitch removes the rating from Under Criteria Observation. In addition, Fitch has assigned a Long-Term Issuer Default Rating of 'BB+' to Methodist University. The Rating Outlook is Stable. SECURITY Methodist's obligations pursuant to a loan agreement with the issuer are a general, unconditional obligation payable from all legally available university funds. Methodist secures its obligations under the agreement with a mortgage interest in its core campus. ANALYTICAL CONCLUSION The downgrade of Methodist University's bond rating to 'BB+' from 'BBB' reflects the university's recent trend of weakening demand and financial performance, as well as the implementation of Fitch's U.S. Public Finance College and University Rating Criteria. The ratings reflect the university's thin cushion of available funds (AF) to adjusted debt relative to Fitch's assessment of the university's revenue defensibility and operating risk. Revenue defensibility is characterized by historically moderate demand indicators with sharply weaker enrollment and admissions in recent years. Midrange operating risk reflects limited cost management and adequate cash flow margins. Near-term capital projects being completed in fiscal 2019 afford some flexibility in the timing and level of future capital investment needs with a history of moderate donor support. The university exhibits a weaker financial profile with limited AF to adjusted debt and a high degree of sensitivity to revenue and investment stresses. KEY RATING DRIVERS Revenue Defensibility: 'bbb'; Demand-Driven Revenue Declines Methodist's 'bbb' revenue defensibility assessment is characteristic of the university's moderate demand indicators, limited market reach and relatively price elastic student base. Admissions and enrollment metrics have deteriorated sharply in recent years, indicative of eroding demand. Deposits to date, fall 2019 versus 2018, indicate possible stabilization, and new graduate programs in the health sciences may enhance revenues in the intermediate term. Operating Risk: 'bbb'; Limited Cash Flow and Manageable Capital Needs The 'bbb' operating risk assessment reflects Fitch's expectations for sustained adequate cash flow margins as the university works to stabilize demand and scale expenses in the near to intermediate term. Lifecycle investment needs are manageable with flexible timing and a track record of stable donor support. Financial Profile: 'bb'; Weak Leverage Profile Methodist's 'bb' financial profile assessment reflects relatively high leverage relative to the moderate strength of the university's business profile. AF levels have declined in recent years with investment in facilities and Fitch considers Methodist's leverage profile to be vulnerable to investment and revenue stresses. Asymmetric Additional Risk Considerations No asymmetric additional risk considerations apply to Methodist's rating. RATING SENSITIVITIES DEMAND-DRIVEN OPERATING PRESSURE: Given Methodist University's limited balance sheet resources, continued enrollment declines or further deterioration in financial performance would likely result in downward rating action. CREDIT PROFILE Methodist is a small, private liberal arts university located in Fayetteville, NC. Methodist has been expanding its academic programs from liberal arts and specialized programs, like golf management, to include health sciences, education and engineering. The university's regional accreditation with the Southern Association of Colleges and Schools Commission on Colleges is currently in the reaffirmation process and management reports that re-accreditation is progressing without incident and will be complete in December of 2019. Methodist's total headcount enrollment measured 2,092 in fall 2018 (fiscal 2019) and 1,975 on a full time equivalent (FTE) basis, reflecting sharp declines of about 14% since fall 2017. The university serves a mix of full-time and part-time traditional residential students, commuters and military personnel from the nearby Fort Bragg. Active-duty and affiliated students represent more than 20% of university enrollment. Revenue Defensibility Methodist's enrollment trends have declined sharply in the last two fiscal years following a general history of moderate demand indicators and a stable to growing level of enrollment in key programs. Acceptance rates have remained moderate at over 50%, whereas matriculation rates have eroded in recent years to around 19% since fiscal 2017 from nearly 24% in fiscal 2014. The effect of declining freshman admissions has been compounded by persistently low retention, below 60% in recent years. Management reports that deposits for fall 2019 are consistent with the prior year, indicating that freshman demand may be stabilizing. Management has not attributed declines to any specific market changes, but they are evaluating current academic program performance to strengthen outcomes in future years. The university has launched some health science-related undergraduate and graduate programs that may improve demand over the intermediate term, but these are not yet fully established and sustained progress will be necessary to spur improvement. The university draws a largely in-state student base, and out of state students are generally from within the southeast region. North Carolina exhibits generally strong market characteristics with high levels of population and economic growth, as well as growth in college-going students. Methodist has struggled to capitalize on these favorable trends due to shifts in demand for Methodist's program offerings and significant competition from strong public and private institutions. Methodist's student base is fairly price sensitive, given the availability of strong public alternatives, and changes in net price are expected to result in lower enrollment while potentially generating marginally more revenue. Student-generated revenues account for around 90% of total revenues and the university has lowered the rate of annual tuition and fee increases to around 3% in fiscals 2018 and 2019 from nearly 5% in prior years. The university expects new health science graduate programs will generate accretive net tuition revenue on a per-student basis, but combined enrollment in these programs is expected to remain modest in the near to intermediate term. Fitch considers the university's endowment spend policy of 4.5% of the prior 12 quarter market value to be sustainable. Endowment support accounts for a fairly small portion of Methodist's revenues and the university relies on managing student-driven revenue and containing expenses to achieve balanced operations. Fitch believes the sharp decline in admissions and enrollment beginning in fall 2017 are an asymmetric rating factor consideration that may be indicative of erosion in Methodist's student base. Headcount and FTE enrollment both declined by over 14% between fall 2017 and fall 2019 following several years of stability. Management's ability to respond to shifts in demand for program offerings as well as the level of competition from regional institutions will be key to stabilizing demand and revenue trends in the near term. Operating Risk Methodist's operating risk assessment of 'bbb' reflects expectations for cash flow margins in line with history at around 10% as the university aligns spending with revenue volatility. The assessment is further supported by a moderate level of capex requirements and consistent but limited donor support. Methodist's adequate level of operating cost flexibility reflects expectations for cash flow margins around 10% in the near term, as the university scales expenses to recent revenue volatility. Cost savings resulting from layoffs, holding vacant positions and analyzing program performance are expected to sustain spending containment efforts in future years and, in the intermediate term, may result in margins somewhat more closely aligned to cash flow generally exceeding 10% prior to fiscal 2018. Fitch is concerned that recent spending cuts may limit management's capacity to respond to future revenue volatility without materially affecting student experience and thereby exacerbating enrollment pressure. Capital spending requirements are moderate as the university recently completed projects in fiscal 2019 and has no material capital plans for the intermediate term. Methodist has received consistent moderate donor support for capital improvements and major projects, including new engineering and science facilities and the Matthew Ministry Center, which was completed in fiscal 2019. The university's average age of plant ranged between 11 and 13 years through fiscal 2018, consistent with a manageable level of lifecycle investment need, and management reports limited additional capital plans. Financial Profile Fitch's base case analysis reflects consistent to improving cash flow and a generally stable trend of AF to adjusted debt over the forward look improving to near 50%, in line with historical levels prior to fiscal 2018 and appropriate for the rating category. The scenario's near-term leverage is consistent with fiscal 2018 and management's reported 2019 (unaudited) expectation and the scenario. The base case assumes that the university's enrollment and revenue growth strategy achieves some success, stabilizing in fiscal 2020 and returning to moderate revenue growth in fiscal 2021 through 2023. As a result, cash flow margins are assumed to stabilize and modestly and capital investment through the cycle is expected to remain modest. Fitch's stress case reflects a moderate and plausible economic stress to Methodist's investment portfolio. The stress scenario results in an initial investment decline of approximately 11% with AF to adjusted debt declining and remaining below historical levels throughout the forward look. Given the university's solid level of capital spending flexibility, the stress case incorporates some expectation for scaling down capital spending through fiscal 2020. Methodist's liquidity profile is neutral to the rating, as debt service coverage levels and AF to operating expenses remain adequate through both the base and stress cases. Asymmetric Additional Risk Considerations No asymmetric additional risk considerations apply to Methodist's rating. MIDCONTINENT COMMUNICATIONS: Moody's Rates New $985MM Loans 'Ba3' ----------------------------------------------------------------- Moody's Investors Service assigned a Ba3 to Midcontinent Communications new $985 million senior secured bank credit facility, including a term loan and revolver. Moody's also assigned a B3 to the proposed senior unsecured notes. Moody's affirmed the B1 Corporate Family Rating and B1-PD Probability of Default Rating. The outlook remains stable. The new senior secured bank credit facility will include a new 7-year, $685 million senior secured term loan B (due 2026) and a 2-year extension of the existing $300 million senior secured revolving credit facility (due 2024). Midco will also raise $300 million of new 8-year, senior unsecured notes (due 2027). The proceeds of the debt offerings will be used to repay the existing secured term loan and unsecured notes, paydown outstanding revolver borrowings, and pay fees and expenses. The ratings on the repaid instruments will be withdrawn upon transaction close. While Moody's expects the net change in borrowing costs to be lower, and the maturity profile to be more favorable with a longer weighted average, protections for secured lenders will be weakened by amendments to the terms of the credit agreement which will loosen the financial maintenance covenant by .25x. Additionally, incremental debt of approximately $30 million will increase the leverage ratio by approximately .1x (gross reported total debt), and the shift to a more secured capital structure will cause senior secured lenders to assume greater credit risk with less loss absorption from a reduction in the notional amount of junior creditor claims. Affirmations: Issuer: Midcontinent Communications Corporate Family Rating, Affirmed B1 Probability of Default Rating, Affirmed B1-PD Assignments: Issuer: Midcontinent Communications Senior Secured Term Loan B, Assigned Ba3 (LGD3) Senior Secured Revolving Credit Facility, Assigned Ba3 (LGD3) Gtd Senior Unsecured Regular Bond/Debenture, Assigned B3 (LGD6) Outlook Actions: Issuer: Midcontinent Communications Outlook, Remains Stable RATINGS RATIONALE The B1 Corporate Family Rating reflects Midcontinent Communications small scale and elevated leverage which Moody's projects will average near low 4x (Moody's adjusted total gross debt to EBITDA over the next 12-18 months). In addition, the Company's credit profile is constrained by unfavorable sector trends with video subscribers declining by low to mid-single digit percent. This weakness is lowering the Company's market penetration, with its calculation of the Triple-Play-Equivalent ratio rising to the high 20% range over the next 12-18 months, but still well below the rated peer group average. Midco is also subject to a put of Comcast Corporation's (Comcast) 50% equity ownership of Midco, which is exercisable in October of 2025. Based on historical precedent, Moody's expects any extension of the put to be costly and to come prior to the exercise date. In the last two extensions, large debt-funded dividends were paid which substantially increased leverage. If the put is exercised, Moody's estimates Midco would need to lever up by at least 2x to repurchase Comcast's equity share which is likely worth at least $1 billion. Offsetting the risk factors, the credit profile is supported by a very stable and predictable business model with strong demand drivers in residential and commercial broadband. With high margins and growth, it will support annual organic revenue growth in the low to mid-single-digit percent range and strong EBITDA margins in the low 40% range. Moody's also views Comcast Corporation's (A3, stable) 50% ownership of the Company positively from an operating perspective, with the benefit of access to management and lower programming costs. The refinancing transaction shifts the capital structure substantially, increasing the notional amount of senior secured debt relative to unsecured debt. Pro forma for the refinancing transaction, Midco's capital structure will consist of a $685 million Term Loan B, a $300 million (committed) revolving credit facility and $300 million in senior unsecured notes. Moody's rates the new credit facility Ba3, one notch above the B1 CFR with the benefit of loss absorption attributable to the $300 million in unsecured notes. The unsecured notes are rated B3, two notches below the CFR, given its subordination to the senior capital. The B1-PD Probability of Default Rating (PDR) reflects the mix of senior and junior claims and its expectation for an average recovery of approximately 50% in its modeled distress scenario. Insignificant, unsecured and unrated claims for trade payables and lease rejection claims do not affect the instrument ratings. OUTLOOK The stable outlook reflects Moody's expectation for (Moody's adjusted) debt, revenue, and EBITDA of approximately $1.1 billion, $645 million, and $270 million, respectively, over the next 12-18 months. Net of interest (assuming average borrowing costs near 5.75%) and capex (to revenue of approximately 18%), Moody's projects free cash flows to average near $60 million. Moody's projects leverage will range near low 4x over the next 12-18 months, with free cash flow to debt averaging near 6% and rising. Key assumptions include organic broadband subscriber growth in the mid-single digit percent range, and video subscriber losses in the low to mid-single digit percent range. Moody's expects Midco to maintain good liquidity, with financial policies to remain favorable to shareholders. The outlook also assumes no material changes in ownership, organizational or capital structure, regulation, business model, operating performance and metrics, scale or diversity, competition, market position, liquidity, or financial policy. WHAT COULD LEAD TO AN UPGRADE Lack of scale somewhat limits upward ratings momentum. However, the ratings could be upgraded if leverage is sustained at or below 3.5x total debt to EBITDA (Moody's adjusted), and free cash flow to debt (Moody's adjusted) is sustained in the high single-digit percent range. A positive rating action would also be contingent on material and favorable changes in one or more of the following: capital structure, regulation, business model, operating performance and metrics, scale or diversity, competition, market position, liquidity or financial policy such that when taken together, credit risk is lower. WHAT COULD LEAD TO A DOWNGRADE Moody's would consider a downgrade if leverage is sustained above 5x total debt to EBITDA (Moody's adjusted), or free cash flow to debt (Moody's adjusted) is sustained below 4%. A negative rating action would also be considered if there were material and unfavorable changes in one or more of the following: capital structure, regulation, business model, operating performance and metrics, scale or diversity, competition, market position, liquidity or financial policy such that when taken together, credit risk is higher. The principal methodology used in these ratings was Pay TV published in December 2018. PROFILE Headquartered in Sioux Falls, South Dakota, Midcontinent Communications provides video, high speed data, and voice services to residential and commercial customers in the states of North Dakota, South Dakota, Minnesota and Wisconsin and Kansas. Through a partnership arrangement, Comcast Corporation owns a 50% common equity interest in Midco. Revenue for the twelve months ended March 31, 2019 was approximately $611 million. MIDWAY OILFIELD: Taps Germer as Litigation Counsel -------------------------------------------------- Midway Oilfield Constructors, Inc. received approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Germer, PLLC as special litigation counsel. The firm will represent the Debtor in two separate lawsuits filed under the Fair Labor Standards Act. The first is styled as Billy Bagby et al. v. Midway Oilfield Constructors, Inc. d/b/a Midway Energy Services (Civil Action No. 4:17-cv-02223). The second lawsuit is styled as Braxton Nesloney v. Midway Oilfield Constructors Inc. and Billy Smith (Civil Action No. 4:18-cv-00407). Both were filed in the U.S. District Court for the Southern District of Texas. Germer will be paid on an hourly basis and will receive reimbursement for work-related expenses. Fees and expenses will be paid by Travelers Casualty and Surety Company of America. Larry James Simmons, Esq., at Germer, disclosed in court filings that the firm's attorneys are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Germer can be reached through: Larry James Simmons, Esq. Germer, PLLC 2929 Allen Pkwy Suite 2900 Houston, TX 77019 Phone: (713) 650-1313 Fax: (713) 739-7420 About Midway Oilfield Constructors Midway Oilfield Constructors, Inc., provides construction services to the upstream, midstream, and downstream sectors of the oil and gas industry. Based out of Midway, Texas, Midway provides services across the State of Texas and Oklahoma. On Aug. 15, 2018, Midway Oilfield Constructors filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (S.D. Tex. Case No. 18-34567). The Debtor estimated $1 million to $10 million in assets and $10 million to $50 million in liabilities as of the bankruptcy filing. Judge Marvin Isgur is the case judge. The Debtor tapped Hoover Slovacek LLP as its legal counsel. Hrdlicka White Williams & Aughtry, is the special tax counsel. The Office of the U.S. Trustee on Nov. 14, 2018, appointed three creditors to serve on an official committee of unsecured creditors in the Chapter 11 case. The committee members are: (1) Buffalo Gap Instrumentation & Electric Co. Inc.; (2) Sun Coast Resources, Inc.; and (3) Baldwin Redi-Mix Co., Inc. Lugenbuhl Wheaton Peck Rankin & Hubbard, is counsel to the Committee. MURPHY OIL: S&P Cuts ICR to BB+ on Closure of Malaysian Asset Sale ------------------------------------------------------------------ S&P Global Ratings lowered its ratings on Murphy Oil Corp., including its issuer credit rating and unsecured issue ratings, to 'BB+' from 'BBB-', and removed the ratings from CreditWatch, where they were placed with negative implications on April 23, 2019. The outlook is stable. The downgrade follows Murphy Oil's Malaysian asset divestment closure. S&P views these assets as having provided favorable geographic diversity from a low-risk basin yielding above-market natural gas prices . The sale follows the recently closed acquisition of deepwater Gulf of Mexico properties from LLOG affiliates. The Gulf now accounts for about half of Murphy's total expected production. While S&P views these transactions as favorably valued with respect to Murphy, the increase in geographic concentration, combined with an increasing focus on deepwater offshore exploration and development as well as heightened capital expenditures over the next two years are negatives for credit risk. Moreover, S&P notes Murphy Oil's size in terms of proved reserves and production is smaller than that of most investment-grade peers. Pro forma for all transactions, proved reserves totaled approximately 760 million barrels of oil equivalent (mmboe) as of year-end 2018. About a third of the company's reserves comprise properties in the Montney and Duvernay plays in Western Canada, where a difficult pricing environment hinder profitability. Finally, S&P anticipates Murphy will generate negative discretionary cash flow after dividends and a planned $500 million share repurchase program over the next two years as the company executes a number of offshore development projects, including Samurai and Khalessi/Mormont. The LLOG opportunity represents a longer-term free cash flow generating asset, in S&P's view. S&P said, "The stable outlook reflects S&P Global Rating's expectation that Murphy Oil will reach and maintain modest financial policies such that FFO to debt will average approximately 40% and debt to EBITDAX 2x over the next two years, while expanding reserves and production primarily in the Eagle Ford region. We expect both future potential acquisitions or international exploration efforts will be funded in a manner that preserves current credit metrics. "We could lower ratings if we expected debt to EBITDAX to approach 4x and FFO to debt to approach 20% for an extended period. Such an event could occur if either crude oil prices were to fall substantially or if Murphy were to pursue a more aggressive financial policy by significantly outspending cash flows due to higher-than-expected capital spending or share repurchases. "We could raise ratings if Murphy Oil increased production and reserves in line with investment grade E&P peers while limiting proportional Gulf of Mexico exposure. Concurrently, we would expect the company to sustain debt to EBITDAX of well below 2x and FFO to debt well above 45%. This would likely require meaningful success at the company's exploration efforts or an acquisition while maintaining modest financial policies." NASCAR HOLDINGS: Moody's Assigns Ba2 CFR, Outlook Stable -------------------------------------------------------- Moody's Investors Service assigned a Ba2 Corporate Family Rating and Ba2--PD Probability of Default Rating to NASCAR Holdings, Inc., as well as a Ba2 rating to the proposed senior secured credit facilities, which include a $150 million 5-year revolver and a $1,410 million 7-year term loan B. The outlook is stable. Net proceeds are expected to be used to acquire International Speedway Corporation for $45/share, repay a portion of ISC's outstanding debt, and refinance outstanding debt at NASCAR. Members of the France family, which own 100% of NASCAR and have a significant ownership position and control approximately 75% of the combined voting power of both classes of common stock of ISC, will own 100% of the combined company at closing. The transaction combines the sanctioning body of NASCAR and other race series with the largest track owner and operator of NASCAR events (i.e., ISC owns or operates 13 race tracks and promotes 19 NASCAR Cup events annually). This is the first time Moody's has rated NASCAR. A summary of the rating actions are as follows: Issuer: NASCAR Holdings, Inc. Corporate Family Rating, Assigned Ba2 Probability of Default, Assigned Ba2-PD $150 million 5-year senior secured revolver, Assigned Ba2 (LGD3) $1,410 million 7-year senior secured term loan B, Assigned Ba2 (LGD3) Outlook, Assigned Stable RATINGS RATIONALE NASCAR's Ba2 CFR reflects its ownership of the NASCAR sanctioning body and the largest NASCAR track owner as well as other race events. Leverage pro forma for the transaction is moderately high at 4.3x (Moody's adjusted) as of Q1 2019, although Moody's expects a portion of free cash flow will be directed to debt repayment that will support deleveraging. The rating benefits from two TV broadcast agreements with contractual increases through 2024, which have buttressed performance and offset persistent declines in admissions and food, beverage and merchandise revenue. High levels of capital spending over the past few years on renovations to existing tracks and developments on its properties should also help support results. The casino joint venture at the company's Kansas racetrack is expected to lead to reoccurring dividend payments and hotel and residential developments also have the potential to support performance. NASCAR is constrained by multiyear declines in attendance due to reduced fan interest in NASCAR racing. Several changes to the sport have been made to increase fan interest and attract different demographic groups, but reduced fan interest is expected to continue to be a challenge for the company. Results are also sensitive to weather conditions during race events. While the TV broadcast agreements have offset declines in revenue from other segments at ISC, the agreements expire at the end of 2024 while the term loan matures in 2026. The inability to renew the broadcasting agreements at comparable terms could have a material impact on future performance especially given the increasing reliance on revenue from broadcasting. NASCAR's liquidity position is expected to be good due to the $150 million 5-year revolver that is projected to be undrawn at close in addition to approximately $139 million of cash on the balance sheet. Capex is expected to be approximately $100 million in 2020 following the completion of several large scale renovations of racetracks and about $25 million of dividends are projected to be paid out. ISC received $26.6 million in pre-tax distributions from Kansas Entertainment due to ISC's joint venture in a casino at its Kansas City track which Moody's projects will continue going forward. Free cash flow (FCF) as a percentage of debt is expected to improve to the mid-single digits in 2020 when capex begins to decline and Moody's projects a portion of FCF will be directed to debt repayment. The term loan is expected to be covenant lite with the revolver subject to a springing first lien net leverage ratio of 6.25x (as defined in the credit agreement) when more than 35% of the revolver is drawn. The outlook is stable with revenue projected to be flat to slightly positive as higher TV broadcast revenue offsets declines in admission and food, beverage, and merchandise revenue. Moody's expects a portion of free cash flow will be used to repay debt that will lead to a modest reduction in leverage over the next 12 to 18 months. The challenging trends in NASCAR racing due to declines in fan interest constrains upward rating pressure. However, the ratings could be upgraded if leverage is maintained below 3x (Moody's adjusted) with free cash flow as a percentage of adjusted debt sustained in the low teens. A stabilization of fan interest in NASCAR racing would also be required as reflected by attendance revenue growth and positive broadcast viewership trends. The ratings could be downgraded if leverage increased above 4.5x (Moody's adjusted) due to declines in revenue and EBITDA that stem from underperformance or debt funded distributions or acquisitions. Inability to improve free cash flow as a percentage of adjusted debt to the 5% range could also lead to a downgrade as would a weakened liquidity position. NASCAR Holdings, Inc., headquartered in Daytona Beach, Florida is the sanctioning body of NASCAR and other race series. The company also owns and operates a racetrack and a road course as well as the operation of a second road course through a land lease agreement. In Q2 2019, NASCAR entered into an agreement to acquire ISC. Members of the France family own 100% of NASCAR. Pro forma revenue was approximately $1.4 billion as of LTM 3/31/19. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. NATIONAL RADIOLOGY: VRAD Objects Disclosure Statement, Plan ----------------------------------------------------------- Virtual Radiologic Professionals of Illinois, S.C., Inc., ("VRAD") object to the confirmation of the Plan of Reorganization of National Radiology Consultants, P.A., and approval of the corresponding Disclosure Statement. VRAD objects to confirmation and the disclosure statement on the basis of the fact that third-party releases are generally disfavored and would appear to only be granted under the most exceptional of circumstances, none of which are evident or ever present in this case. VRAD points out that the Plan and Disclosure Statement is next objectionable and legally improper by virtue of the fact that it includes in Article 3, Section 5, (3.5) an independent "Class 5" which is entitled "Unsecured Wage Claims. VRAD further points out that the plan is objectionable and in the eyes of this creditor, VRAD, it represents a clear and illegal attempt by the Debtor to abuse the bankruptcy process to direct defriment of all unsecured creditors, when as declared, it includes within Article 3, Section 5, (3.5) "Class 5" entitled "Unsecured Wage Claims" that, "the Debtor's principal Dr. James Okoh holds an Allowed Unsecured Wage Claim of $463,650.00 (the "Okoh Wage Claim"). VRAD asserts that the plan is objectionable and in the eyes of this creditor, VRAD, it represents a clear and illegal attempt by the Debtor to abuse the bankruptcy process to direct defriment of all unsecured creditors, when as declared, it includes within Article 3, Section 5, (3.5) "Class 5" entitled "Unsecured Wage Claims" that, "the Debtor's principal Dr. James Okoh holds an Allowed Unsecured Wage Claim of $463,650.00 (the "Okoh Wage Claim"). Attorney for VRAD: RICHARD J. STONE, P.A. 9350 S. Dixie Highway, Suite 1455 Miami, FL 33156 Tel: (305) 670-2080 Email: rich@rjstonelaw.com About National Radiology Consultants National Radiology Consultants, P.A., is healthcare practice management provider, specializing in radiology, anesthesiology, emergency, and hospital medicine solutions. National Radiology Consultants filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 19-01274) on Feb. 15, 2019. In the petition signed by Jame Okoh, M.D., president and chief executive officer, the Debtor disclosed $18,709,234 in assets and $4,925,568 in liabilities. The Debtor is represented by Daniel E. Etlinger, Esq., at Jennis Law Firm. NEW GARDEN: Taps Gary W. Cruickshank as Legal Counsel ----------------------------------------------------- New Garden Inc. received approval from the U.S. Bankruptcy Court for the Eastern District of Massachusetts to hire the Law Office of Gary W. Cruickshank as its legal counsel. The firm will provide services in connection with the Debtor's Chapter 11 case, which include legal advice regarding its duties under the Bankruptcy Code and the preparation of a plan of reorganization. Gary Cruickshank, Esq., the firm's attorney who will be handling the case, charges an hourly fee of $400 for his services. Paraprofessionals charge $150 per hour. The firm received the sum of $6,717, which included the filing fee of $1,717. Mr. Cruickshank disclosed in court filings that he is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Mr. Cruickshank maintains an office at: Gary W. Cruickshank, Esq. Law Office of Gary W. Cruickshank 21 Custom House Street, Suite 920 Boston, MA 02110 Phone: (617) 330-1960 Email: gwc@cruickshank-law.com About New Garden Inc. New Garden, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mass. Case No. 19-11956) on June 6, 2019. At the time of the filing, the Debtor had estimated assets of less than $500,000 and liabilities of less than $1 million. The case is assigned to Judge Frank J. Bailey. NORTHWOODS AUTO: Seeks to Hire Cunningham Chernicoff as Counsel --------------------------------------------------------------- Northwoods Auto, Inc. seeks approval from the U.S. Bankruptcy Court for the Middle District of Pennsylvania to hire Cunningham, Chernicoff & Warshawsky, P.C. as its legal counsel. The firm will advise the Debtor of its powers and duties under the Bankruptcy Code and will provide other legal services in connection with its Chapter 11 case. The firm's hourly rates are: Partners $200 - $400 Associate Attorneys $150 - $225 Paralegals $100 The Debtor has agreed to provide the firm a pre-bankruptcy retainer of $911. Robert Chernicoff, Esq., a shareholder of Cunningham and the firm's attorney who will be handling the case, charges an hourly fee of $400. Mr. Chernicoff disclosed in court filings that his firm has no connection to the Debtor, creditors or any other party with actual or potential interest in the Debtor's case. Cunningham can be reached through: Robert E. Chernicoff, Esq. Cunningham, Chernicoff & Warshawsky, P.C. 2320 North Second Street Harrisburg, PA 17110 Tel: 717 238-6570 Fax: 717 238-4809 Email: rec@cclawpc.com About Northwoods Auto Inc. Northwoods Auto, Inc., a Nissan car dealer in Hummels Wharf, Pa., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Pa. Case No. 19-02857) on July 2, 2019. At the time of the filing, the Debtor disclosed assets of between $1 million to $10 million and liabilities of the same range. The case is assigned to Judge Henry W. Van Eck. OCALA INN: Unsecured Creditors to Get Full Payment in 12 Months --------------------------------------------------------------- Ocala Inn Management, Inc., filed a Chapter 11 plan and accompanying disclosure statement. Class 7 General Unsecured Claims are impaired. There are no unsecured claims known at this time. The estimated tax claims as listed in POC 2-2 filed by the Internal Revenue Service will be paid in full within 12 months of the date of Confirmation of this Plan. Class 2 City of Ocala 110 S.E. Watula Avenue Ocala FL 34471-0000 are impaired. Lien to be avoided as mortgage was paid in full prior to filing of current Chapter 11. Class 3 Central FL Swimming Pools 506 SOUTH MAGNOLIA AVENUE Ocala FL 34471-0000 are impaired. Lien to be avoided as judgment was paid in full prior to filing of current Chapter 11. Class 4 Center State Bank, 1101 First St. South, Winter Haven, FL 33380 as successor in interest to Harbor Community Bank are impaired. Paid normal contract payment of $7,193.41 throughout remaining term of mortgage. No arrears known at this time. Class 6 City of Ocala 110 S.E. Watula Avenue Ocala FL 34471-0000 are impaired. Any amounts currently outstanding will be cured by the debtor within 12 months of the confirmation of this Plan. Payments and distributions under the Plan will be funded by income from construction business owned by Debtor. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y5g52o5w from PacerMonitor.com at no charge. Attorney for the Debtor is Bryan K. Mickler, Esq., at Law Offices of Mickler & Mickler, LLP, in Jacksonville, Florida. About Ocala Inn Management Ocala Inn Management, which owns a hotel located at 3767 NW Blitchton Road, Ocala, Fla., valued by the company at $1.97 million, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-00875) on March 13, 2019. It previously sought bankruptcy protection (Bankr. M.D. Fla. Case No. 12-02468) on April 12, 2012. At the time of the filing, the Debtor disclosed $3,057,592 in assets and $1,201,280 in liabilities. Judge Jerry A. Funk oversees the case. The Debtor tapped the Law Offices of Mickler & Mickler, LLP as its legal counsel. The U.S. Trustee, until further notice, will not appoint an official committee of unsecured creditors in the Chapter 11 case. PARKINSON SEED: Unsecureds to Get Annual Payments Over 10 Years --------------------------------------------------------------- Parkinson Seed Farm, Inc., filed a Chapter 11 Plan and accompanying Disclosure Statement. Class 14 Unsecured Litigation Claims. Payment amount unknown; once it is determined if any is owed, it shall be paid in annual payments over 10 years. Class 3 Secured Compeer Mortgage. Semi-annual payments starting June 2020. Class 4 Secured Summit Bridge. One payment in December 2019; then monthly payments starting in May 2020. Class 5 Secured Ally Finance. Semi-annual payments starting in June 2020. Class 6 Secured First National (May Dry Farm). Semi-annual payments starting in June 2020. Class 7 Secured John Deere Financial. One annual payment in December 2019; then semi-annual payments starting in March 2020. Class 8 Secured Reinke Grain Company. Semi-annual payments starting in June 2020. Class 9 Secured First American (Steinan Dry Farm). Semi-annual payments starting in June 2020. Class 10 Secured Toyota Motor Credit. Semi-annual payments starting in June 2020. Class 11 Unsecured JD Rejected Leases. Semi-annual payments starting September 2020. Class 12 Unsecured Kenworth. Semi-annual payments starting June 2020. Class 13 Unsecured Trade Payables. Semi-annual payments starting June 2020. The Debtor will fund a large portion of this plan through the sale of various tracts of real estate. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y269ucty from PacerMonitor.com at no charge. Attorneys for the Debtor are Brent T. Robinson, Esq., and W. Reed Cotten, Esq., at Robinson & Associates, in Rupert, Idaho. About Parkinson Seed Farm Located in Saint Anthony, Idaho, Parkinson Seed Farm, Inc. -- http://www.parkinsonseedfarm.com/-- farms 7,200 acres of potatoes. It raises seed potatoes, hard red and hard white wheat, as well as a small amount of alfalfa (mostly to feed horses for recreational purposes). The company raises 11 of what it considers to be more mainstream varieties such as the Russet Burbank, Ranger, three different line selections of Russet Norkotah, white varieties such as Cal Whites and Atlantics, and reds like the Dark Red Norland. The company was founded in 1937. Parkinson Seed Farm sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No. 18-40412) on May 15, 2018. In the petition signed by Dirk Parkinson, president, the Debtor disclosed $6.11 million in assets and $26.92 million in liabilities. Judge Joseph M. Meier oversees the case. The Debtor hired Robinson & Associates as its legal counsel. PETSMART INC: Moody's Raises CFR to B3, Outlook Stable ------------------------------------------------------ Moody's Investors Service upgraded PetSmart, Inc.'s Corporate Family Rating and probability of default rating to B3 and B3-PD from Caa1 and Caa1-PD respectively. Additionally, Moody's upgraded the rating of its senior secured term loan and senior secured notes to B2 from B3 and upgraded its senior unsecured notes to Caa2 from Caa3. The outlook is stable. "The upgrade follows the recent successful IPO of Chewy and the subsequent debt repayment from the proceeds of the IPO thereby improving leverage to 7.2x from 7.8x. The current implied Chewy valuation of about $14 billion is also a positive in terms of coverage for lenders as PetSmart currently owns about 67% of Chewy", Moody's Vice President Mickey Chadha stated. "We also expect credit metrics to improve further in the next twelve months as the company further monetizes its stake in Chewy and uses proceeds to repay more debt ", Chadha further stated. Upgrades: Issuer: PetSmart, Inc. Corporate Family Rating, Upgraded to B3 from Caa1 Probability of Default Rating, Upgraded to B3-PD from Caa1-PD Senior Secured Bank Credit Facility, Upgraded to B2 (LGD3) from B3 (LGD3) Senior Secured Regular Bond/Debenture, Upgraded to B2 (LGD3) from B3 (LGD3) Senior Unsecured Regular Bond/Debenture, Upgraded to Caa2 (LGD5) from Caa3 (LGD5) Outlook Actions: Issuer: PetSmart, Inc. Outlook, Remains Stable RATINGS RATIONALE PetSmart's credit profile (B3 stable) reflects the company's high leverage with lease adjusted debt/EBITDA proforma for the $825 million debt reduction through the Chewy IPO proceeds of 7.2 times. However, Moody's does expect further deleveraging in the next 12-18 months as the company continues to monetize its stake in Chewy and reduce its debt burden through these proceeds. Although competition remains intense particularly from e-commerce and mass retailers Moody's also expects the company's topline and margins to stabilize as strategic initiatives take hold. Therefore Moody's expects debt/EBITDA to improve to below 6.5 times in the next 12 months. Positive rating factors include PetSmart's position as the largest specialty retailer of pet food, supplies and services in the U.S., with a well-known brand and broad national footprint. The company's sizeable services offering is a positive as it provides a defensible market position and is less vulnerable to e-commerce. The pet products industry in general remains relatively recession resilient, driven by factors such as the replenishment nature of consumables and services and increased pet ownership. The company's credit profile is also enhanced by its very good liquidity and the company's 67% ownership of Chewy whose current implied valuation more than covers the amount of total debt outstanding. The stable outlook reflects Moody's expectation that credit metrics will improve in the next 12 months and liquidity will remain very good. Sustained growth in revenue and profitability while demonstrating conservative financial policies, including the use of free cash flow and Chewy IPO proceeds for debt reduction, could lead to a ratings upgrade. Quantitatively, ratings could be upgraded if debt/EBITDA is sustained below 5.75 times and if EBIT/interest expense is sustained above 1.5 times while maintaining good overall liquidity. PetSmart's ratings could be downgraded if same store sales trends continue to deteriorate or if operating margins continue to erode, indicating that the company's industry or competitive profile continues to weaken. Ratings could also be downgraded if the company's financial policies were to become aggressive. Quantitatively, a ratings downgrade could occur if debt/EBITDA does not improve and remains above 6.75 times or EBIT/interest is sustained below 1.0 times. The principal methodology used in these ratings was Retail Industry published in May 2018. PORT CITY HOSPITALITY: Hires Galloway Wettermark as Counsel ----------------------------------------------------------- Port City Hospitality Group, LLC, seeks authority from the U.S. Bankruptcy Court for the Southern District of Alabama to employ Galloway Wettermark & Rutens, LLP, as attorney to the Debtor. Port City Hospitality requires Galloway Wettermark to: a. give the Debtor advice with respect to its powers and duties as debtor-in-possession in the continued operation of its business and management of its property; b. protect the interest of the Debtor and debtor-in-possession in connection with lawsuits filed by the Debtor; c. prepare the Debtor as debtor-in-possession such applications, answers, orders, reports and other legal papers; and d. perform all other legal services for the Debtor-in- possession which may be necessary herein. Galloway Wettermark will be paid based upon its normal and usual hourly billing rates. The firm will also be reimbursed for reasonable out-of-pocket expenses incurred. J. Willis Garrett, III, a partner of Galloway Wettermark & Rutens, LLP, 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. Galloway Wettermark can be reached at: J. Willis Garrett, III, Esq. GALLOWAY WETTERMARK & RUTENS, LLP 3263 Cottage Hill Rd. Mobile, AL 36606 Tel: (251) 476-4493 E-mail: wgarrett@gallowayllp.com About Port City Hospitality Group, LLC Port City Hospitality Group LLC, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Ala. Case No. 19-12042) on June 17, 2019, disclosing under $1 million in both assets and liabilities. The Debtor is represented by J. Willis Garrett, III, a partner of Galloway Wettermark & Rutens, LLP. PROMETRIC HOLDINGS: S&P Alters Outlook to Negative, Affirms 'B' ICR ------------------------------------------------------------------- S&P Global Ratings revised the outlook on U.S.–based test developer and test delivery company Prometric Holdings Inc. to negative from stable and affirmed the 'B' issuer credit rating. The outlook revision reflects the company's muted revenue growth, higher than expected operating costs, and a sustained high debt burden that have resulted in FOCF/debt below 5%, which is low for the current 'B' rating. If this trend continues over the next 12 months, S&P could lower the issuer credit rating. Prometric's revenue growth was lower than expected over the past 12 months due to contract losses. S&P now expects revenue to be flat for fiscal 2019 versus its prior expectation for low-single-digit percentage growth. Over the past 12 months, the company lost one of its top 10 clients--over $20 million in annual revenue. In addition, Education Testing Service (ETS), its former parent, lost a significant contract that Prometric services under the current agreement. S&P believes these contract losses and volume declines are significant and represent a material setback for the company since the LBO in 2018. S&P said, "The company announced a new major testing contract with the Chartered Financial Analyst Institute (CFAI), but we believe this revenue will not be material until fiscal 2021. Until then, we expect revenue growth to be muted as incremental testing volumes and small new contracts struggle to offset recent major contract losses. We believe these revenue challenges may limit the company's ability to expand profitability and improve cash flow necessary to reduce its debt burden over the next 12 months. "The negative outlook reflects the risk that Prometric's revenue growth and cost management will remain challenged leading to FOCF/debt sustained below 5% and leverage sustained at or above the high-6x area over the next 12 months. "We could lower our ratings on Prometric if FOCF/debt remains below 5% over the next year because of additional contract losses, testing volume declines, setbacks in ramping new contracts, higher than expected operating costs, or organizational missteps. "We could revise the outlook to stable if the company improves its cash flow generation through revenue and EBITDA growth such that FOCF/debt remains comfortably above 5% over the next 12 months." PYRATECH SECURITY: Taps Maxwell Dunn as Legal Counsel ----------------------------------------------------- Pyratech Security Systems, Inc. received approval from the U.S. Bankruptcy Court for the Eastern District of Michigan to hire Maxwell Dunn, PLC as its legal counsel. The firm will provide services in connection with the Debtor's Chapter 11 case, which include legal advice regarding its powers and duties under the Bankruptcy Code; representation in adversary proceedings; assistance with respect to the valuation and sale of its assets; and the preparation of a bankruptcy plan. The firm's hourly rates are: Ethan Dunn Attorney $340 Kimberly Redd Attorney $310 Joshua Castmore Attorney $300 Tierney Eaton Hoffman Attorney $285 Anthony Smith Paralegal $150 Amie Lovins Paralegal $145 Tammi Coleman Paralegal $105 Scott Kass Paralegal $105 Maxwell Dunn received a retainer in the amount of $7,500, of which $1,717 was used to pay the filing fee. Ethan Dunn, Esq., at Maxwell Dunn, disclosed in court filings that he and other attorneys of the firm are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Ethan D. Dunn, Esq. Maxwell Dunn, PLC 24725 W. 12 Mile Road, Suite 306 Southfield, MI 48034 Phone: (248) 246-1166 Email: bankruptcy@maxwelldunnlaw.com About Pyratech Security Systems Inc. Pyratech Security Systems, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No. 18-55926) on Nov. 27, 2018. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of less than $500,000. The case is assigned to Judge Maria L. Oxholm. REGENSBURG HOLDING: Case Summary & 2 Unsecured Creditors -------------------------------------------------------- Debtor: Regensburg Holding Corp 251 Majors Path Southampton, NY 11968 Business Description: Regensburg Holding Corp is engaged in renting and leasing real estate properties. Chapter 11 Petition Date: July 16, 2019 Court: United States Bankruptcy Court Eastern District of New York (Central Islip) Case No.: 19-75031 Judge: Hon. Louis A. Scarcella Debtor's Counsel: Anthony DeCarolis, Esq. ANTHONY DECAROLIS, ESQ. 53 East Main Street Oyster Bay, NY 11771 Tel: (516) 922-7870 Fax: (516) 922-2787 Email: anthony@adlawli.com Total Assets as of July 16, 2019: $2,100,000 Total Debts as of July 16, 2019: $2,549,172 The petition was signed by Charles Regenburg, secretary. A copy of the Debtor's list of two unsecured creditors is available for free at: http://bankrupt.com/misc/nyeb19-75031_creditors.pdf A full-text copy of the petition is available for free at: http://bankrupt.com/misc/nyeb19-75031.pdf REMNANT OIL: Case Summary & 30 Largest Unsecured Creditors ---------------------------------------------------------- Two affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Remnant Oil Company, LLC 19-70106 6 Desta Drive, Suite 5100 Midland, TX 79705 Remnant Oil Operating, LLC 19-70107 6 Desta Drive, Suite 5100 Midland, TX 79705 Business Description: Remnant Oil Company, LLC -- https://www.remnantoil.com -- was formed specifically to acquire and exploit conventional oil and gas assets within the Permian Basin. Remnant Oil Operating currently owns and operates 480 wells and a leasehold portfolio of approximately 47,162 gross acres in Eddy, Lea, and Chaves counties, New Mexico. Remnant subdivides this leasehold into two groups of properties: the Caprock Properties and the Non-Caprock Properties. Chapter 11 Petition Date: July 16, 2019 Court: United States Bankruptcy Court Western District of Texas (Midland) Judge: Hon. Tony M. Davis Debtors' Counsel: Bernard R. Given, II, Esq. LOEB & LOEB LLP 10100 Santa Monica Blvd Suite 2200 Los Angeles, CA 90067 Tel: (310) 282-2000 Fax: (310) 282-2200 Email: bgiven@loeb.com Remnant Oil Company's Estimated Assets: $10 million to $50 million Remnant Oil Company's Estimated Liabilities: $10 million to $50 million Remnant Oil Operating's Estimated Assets: $100,000 to $500,000 Remnant Oil Operating's Estimated Liabilities: $1 million to $10 million The petitions were signed by E. Will Gray II, CEO. A copy of the Debtor's list of 20 largest unsecured creditors is available for free at Full-text copies of the petitions are available for free at: http://bankrupt.com/misc/txwb19-70106.pdf http://bankrupt.com/misc/txwb19-70107.pdf A. List of Debtors' 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Kodiak Gas Services LLC Trade Payable $3,300,000 PO Box 732235 Dallas, TX 75373-2235 Tel: 936-539-3300 Fax: 936-539-3301 Email: sales@kodiakgas.com 2. Baker Hughes Inc. Trade Payable $444,574 PO Box 301057 Dallas, TX 75303-1057 Will Marsh Chief Legal Officer 3. Reliable Well Service Inc. Trade Payable $288,460 512 W Texas Artesia NM 88210 David Barrett, President Tel: 575-513-0145 4. Precision Pump & Supply Trade Payable $235,882 PO Box 115 Loco Hills NM 88255 Robert Dennis, Owner Tel: 575-677-2239 5. Kel-Tech Inc. Trade Payable $218,933 Dept 3426 Dallas, TX 75312 Tel: 432-684-4700 Fax: 432-686-8000 Email: info@keltechinc.com 6. Mesa Well Servicing, LP Trade Payable $146,241 PO Box 1620 Hobbs NM 88241 Tel: 575-393-1042 7. Twin Stars Compression LLC Trade Payable $110,063 100 Iowa Bloomfield NM 87413 Roger Armstrong, President Tel: 505-632-9202 Fax: 505-632-2732 8. Zimmerman Oil Inc. Trade Payable $96,127 PO Box 397 Lovington NM 88260 Zac Zimmerman, President Tel: 575-396-7214 9. Eunice Pump & Supply LLC Trade Payable $95,697 PO Box 1468 Eunice NM 88231-1468 Scott Bateman Tel: 575-394-4012 10. Arts Hot Oil Services LLC Trade Payable $90,302 PO Box 188 Lovington NM 88260-0188 Arturo R Carrasco, Principal Tel: 575-602-1935 11. Ono's Sandblasting & Trade Payable $75,153 Painting LLC PO Box 3790 Hobbs NM 88241-3790 Tel: 575-397-6142 12. Modrall Sperling Roehl Trade Payable $68,092 Harris & Sisk PA PO Box 2168 Albuquerque NM 87103-2168 Tel: 505-848-1801 Email: contact@modrall.com 13. Seale Energy Partners LP Trade Payable $65,906 14942 Sandalfood St Houston, TX 77095 Tel: 281-463-7989 14. Jordan-Rubicon Resources Trade Payable $61,060 LLC 1306 West Texas Ave Midland TX 79701 Tel: 432-686-1808 Email: Tom Fekete, President 15. Alliance Well Service LLC Trade Payable $60,093 PO Box 1807 Artesia NM 88211 Tel: 806-632-3890 16. Bordayo Trucking Trade Payable $57,479 PO Box 3302 Hobbs NM 88242-3302 Eliberto Bordayo, Owner Tel: 575-706-5628 17. Double R Transportation Trade Payable $56,326 LLC PO Drawer 1060 Jal NM 88252 Ricardo Rodriquez Tel: 575-395-2622 18. Bank of America Trade Payable $49,741 475 Cross Point Getzville NY 14068-9000 19. DMC Oilfield Services LLC Trade Payable $49,500 PO Box 1890 Hobbs NM 88241 Tel: 575-391-0105 Fax: 575-391-0446 20. Kill I T Services LLC Trade Payable $46,736 PO Box 482 Lovington NM 88260 Lynn Garay Tel: 575-441-5974 21. Standard Energy Services Trade Payable $45,833 PO Box 2724 Lubbock, TX 79408-2724 Pieter Bergstein, President Tel: 806-741-1080 Fax: 806-741-1301 22. Crain Hot Oil Service LLC Trade Payable $43,593 Drawer 2145 Troy MI 48007 Tel: 575-396-6543 Fax: 575-396-9700 23. Perk-Rock, Inc. Trade Payable $37,500 dba Stevenson-Roach PO Box 157 Artesia NM 88211 Tel: 505-746-3222 Fax: 505-746-9556 24. 50-50 Backhoe Services LLC Trade Payable $35,423 PO Box 375 Artesia NM 88211-0375 Glenn Kaiser Tel: 575-748-5549 25. PCS Ferguson Inc. Trade Payable $31,735 PO Box 732131 Dallas TX 75371-2131 26. Brigade Services LLC Trade Payable $31,448 4615 Devargas ST Hobbs NM 88242 Tel: 575-602-3730 Fax: 575-492-7714 27. Bridge Capital Corp Trade Payable $30,605 2365 Rice Blvd. #201 Houston TX 77005 Tel: 713-533-9642 28. D & C Electric LLC Trade Payable $30,522 1444 W Broadway St Hobbs NM 88242 Tel: 572-492-0044 Fax: 572-492-0045 29. KW Fuels Inc. Trade Payable $29,764 PO Box 1288 Hobbs NM 88241 Keith Pearson, Owner Tel: 575-393-5135 30. Lozoya's Trucking Trade Payable $26,851 & Oilfield Service LLC PO Box 3229 Hobbs NM 88241-3229 Norberto Lozoya, Principal Tel: 432-295-1385 RORA LLC: Hampton House Objects to Disclosure Statement ------------------------------------------------------- The Board of Managers of Hampton House Condominium objects to the approval of the Disclosure Statement explaining RORA, LLC's Chapter 11 plan. Hampton House asserts that the Debtor proposes the sale of the Property but fails to provide any details in its Disclosure Statement as to how it intends to execute a sale of the Property. Hampton House complains that the Debtor fails to provide any reason whatsoever why it would reasonably need until the end of 2020 to complete such sale or refinance – 13 months after entering into a contract. According to Hampton House, the Debtor fails to take into account that additional charges, including assessments, water charges, late charges, and legal fees are and will become due to Hampton House. Hampton House points out that the Debtor's Disclosure Statement also fails to take into account that Common Charges will continue to accrue after August 2019. Attorneys for Hampton House: Jennifer B. Zourigui, Esq. Cory L. Weiss, Esq. Ingram Yuzek Gainen, Esq. CARROLL & BERTOLOTTI, LLP 250 Park Avenue, 6th Floor New York, NY 10177 Tel: (212) 907-9600 About RORA LLC RORA LLC, a New York limited liability company organized in March 2011, owns and operates a parking garage located at 404 E. 79th Street, Manhattan, New York. RORA LLC, based in Brooklyn, NY, filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 19-40354) on Jan. 21, 2019. In the petition signed by Robert Litwin, manager, the Debtor estimated $1 million to $10 million in both assets and liabilities. Lawrence F. Morrison, Esq., at Morrison Tenenbaum, PLLC, serves as bankruptcy counsel to the Debtor, and Pick & Zabicki LLP, is special transaction counsel. RORA LLC: Lender Objects to Disclosure Statement ------------------------------------------------ 404 East 79th Street Lender LLC objects to the adequacy of the Disclosure Statement explaining the Chapter 11 Plan filed by the Debtor Rora LLC. The Lender points out that the Disclosure Statement provides no information whatsoever including the type of lender being sought -- institutional or private -- the amount of financing being sought, the duration of the loan, the interest rate to be paid, or how Debtor intends to make debt service payments given its prior failure to do so. According to the Lender, the Debtor states that it "has received several offers post-petition that are enough to pay all creditors in full," but it does not disclose any detail about said offers such as the price or who made them. The Lender complains that the Debtor should promptly enter into a contract of sale so that this case can be brought to a conclusion in a timely manner. Attorneys for 404 East 79th Street Lender LLC: James M. Andriola, Esq. Andriola Law, PLLC 1385 Broadway, 22nd Floor New York, NY 10018 Telephone: 646-209-9863 Email: james@andriolalaw.com About RORA LLC RORA LLC, a New York limited liability company organized in March 2011, owns and operates a parking garage located at 404 E. 79th Street, Manhattan, New York. RORA LLC, based in Brooklyn, NY, filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 19-40354) on Jan. 21, 2019. In the petition signed by Robert Litwin, manager, the Debtor estimated $1 million to $10 million in both assets and liabilities. Lawrence F. Morrison, Esq., at Morrison Tenenbaum, PLLC, serves as bankruptcy counsel to the Debtor, and Pick & Zabicki LLP, is special transaction counsel. RUBY'S DINER: US Foods Objects to Disclosure Statement ------------------------------------------------------ US Foods, Inc., objects to the approval of the Disclosure Statement explaining the Chapter 11 Plan of Ruby's Diner, Inc. According to US Foods, the Disclosure Statement must disclose to creditors how it plans to pay all administrative expense claims, and to disclose whether it has the funds to pay such claims as of the Plan’s effective date. US Foods points out that the Disclosure Statement states that the Debtors "do not believe any amounts will be owed to parties who provide goods and services after the Petition Date" because such costs will be paid in the ordinary course of business. US Foods further points out that the Disclosure Statement failure to include US Foods on that list may not only prejudice any claim US Foods may have for non-payment by the Debtors will also mislead creditors about the financial obligations of the Debtors as the Debtors attempt to emerge from bankruptcy. Attorneys for US Foods, Inc.: Sharon Z. Weiss, Esq. BRYAN CAVE LEIGHTON PAISNER LLP 120 Broadway, Suite 300 Santa Monica, CA 90401 Telephone: (310) 576-2100 Facsimile: (310) 576-2200 Email: sharon.weiss@bclplaw.com -- and -- Leslie Allen Bayles, Esq. Aaron Davis, Esq. BRYAN CAVE LEIGHTON PAISNER LLP 161 North Clark Street, Suite 4300 Chicago, IL 60601 Telephone: (312) 602-5000 Email: leslie.bayles@bclplaw.com aaron.davis@bclplaw.com About Ruby's Diner Inc. Ruby's Diner, Inc. -- https://www.rubys.com/ -- is a restaurant chain headquartered in Irvine, California. Founded by Doug Cavanaugh and Ralph Kosmides in 1982, it also has locations in California, Nevada, Arizona, Texas, Pennsylvania and New Jersey. Ruby's Diner, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 18-13311) on Sept. 5, 2018. In the petition signed by CEO Douglas S. Cavanaugh, the Debtor estimated assets of $1 million to $10 million and liabilities of $1 million to $10 million. Judge Catherine E. Bauer presides over the case. The Debtor tapped Pachulski Stang Ziehl & Jones LLP as its legal counsel. SANABI INVESTMENTS: Trustee Taps Robert A. Angueira as Counsel -------------------------------------------------------------- The Chapter 11 trustee for Sanabi Investments, LLC received approval from the U.S. Bankruptcy Court for the Southern District of Florida to hire his own firm Robert A. Angueira, P.A. as his legal counsel. The firm will advise the trustee, Robert Angueira, of his powers and duties under the Bankruptcy Code and will provide other legal services in connection with the Debtor's Chapter 11 case. Yanay Galban, Esq., the firm's attorney who will be representing the trustee, disclosed in court filings that the firm neither holds nor represents any interest adverse to the Debtor's bankruptcy estate. The firm can be reached through: Yanay Galban Robert A. Angueira, P.A. 16 SW 1st Avenue Miami, FL 33130 Phone: 305-263-3328 Email: yanay@rabankruptcy.com About Sanabi Investments Sanabi Investments, L.L.C. filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 18-16699) on June 1, 2018. In the petition signed by Saady Bijani, managing member, the Debtor estimated $50,000 to $100,000 in assets and $500,000 to $1 million in liabilities. Chad T. Van Horn, Esq., at the Law Offices of Alla Kachan, P.C., is the Debtor's counsel. Robert A. Angueira was appointed as Chapter 11 trustee for Sanabi Investments, LLC. The trustee is represented by his own firm Robert A. Angueira, P.A. SANJAC SECURITY: Aug. 7 Plan Confirmation Hearing ------------------------------------------------- The disclosure statement explaining the Chapter 11 Plan filed by Sanjac Security, Inc., is conditionally approved. August 7, 2019 at 2:00 pm. is fixed for the hearing on confirmation of the plan and final approval of the disclosure statement. August 5, 2019 at 5:00p.m.is fixed as the last day for filing and serving written objections to confirmation of the plan. August 5, 2019 at 5:00 p.m. is fixed as the last day for filing and serving written objections to the disclosure statement. About Sanjac Security Inc. Based in Humble, Texas, Sanjac Security, Inc., formerly filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 15-31008) on Feb. 24, 2015. Sanjac Security again filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 18-36350) on Nov. 8, 2018. The case is assigned to Judge Jeff Bohm. The Debtor hired Margaret M. McClure, Esq., as its bankruptcy counsel. The Office of the U.S. Trustee on Dec. 18 disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Sanjac Security, Inc. SCOOBEEZ INC: Seeks to Hire Armory Securities as Investment Banker ------------------------------------------------------------------ Scoobeez, Inc. seeks approval from the U.S. Bankruptcy Court for the Central District of California to hire Armory Securities, LLC as its investment banker. The firm will provide these services to the company and its affiliates in connection with their Chapter 11 cases: (a) assist in evaluating the Debtors' strategic alternatives; (b) assist in structuring and effecting the financial aspects of a financing or sale of the Debtors' assets; (c) provide financial advice in connection with the sale or financing, and identify and contact potential acquirers or investors; (d) assist in preparing a memorandum to be used in soliciting potential acquirers or investors; (e) assist in preparing a financial model used for marketing the Debtors; (f) identify and solicit potential transaction parties; (g) assist the Debtors and their other professionals in reviewing and evaluating the terms of any proposed transaction, and in developing and evaluating alternative proposals for a transaction, whether in connection with a bankruptcy plan or otherwise; (h) meet with the Debtors' chief restructuring officer regularly to provide updates with respect to the proposed transaction or alternative proposals; (i) participate in negotiations with potential acquirers or investors; and (j) participate in hearings before the bankruptcy court if requested by the Debtors. Armory Securities will be paid as follows: (a) Monthly Fee. A monthly fee of $33,333. (b) Sale Fee. If a sale is consummated, Armory Securities will receive a fee equal to the following: (i) 3 percent of the transaction value in the case of a sale to any party other than the Debtors' existing secured lender or any of its affiliates; or (ii) A fixed fee of $200,000 in the case of a sale to the Debtors' existing secured lender or any of its affiliates through a credit bid or other transaction. (c) Financing Fee. If the Debtors consummate a financing, Armory Securities will be paid on the closing date a fee equal to the following: (i) 2.5 percent of the first $10,000,000 in gross proceeds from all fnancings; (ii) 3.5 percent of the aggregate amount of gross proceeds in excess of $10,000,000 up to an aggregate amount of $2,000,000 in additional gross proceeds from all financings; and (iii) 4 percent of the aggregate gross proceeds in excess of $12,000,000 raised in all financings. In the event that the existing secured lender or any of its affiliates provides financing to the Debtors, Armory Securities' fee shall be limited to $200,000 on account of such financing and the firm shall be entitled to 4 percent of any additional financing provided by third parties. (d) Minimum Fee. The minimum fee payable to Armory Securities in connection with any sale or financing shall not be less than $200,000. (e) Monthly Fee Credit. In the event of a sale or financing transaction, Armory Securities shall credit the monthly fees paid against the transaction fees. In no event will the monthly fee credit reduce the aggregate of the transaction fees paid below the minimum fee. Eben Paul Perison, managing director of Armory Securities, disclosed in court filings that the firm is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Armory Securities can be reached through: Eben Paul Perison Armory Securities, LLC 1230 Rosecrans Avenue, Suite 660 Manhattan Beach, CA 90266 Tel: (310) 798-7777 Fax: (310) 798-6277 About Scoobeez Scoobeez Inc. -- https://www.scoobeez.com -- operates an on demand door-to-door logistics and real time delivery service company. It offers messaging, same day and preferred deliveries, and courier services. Scoobeez and its affiliates, Scoobeez Global Inc. and Scoobur LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Lead Case No. 19-14989) on April 30, 2019. The cases have been assigned to Judge Julia W. Brand. At the time of the filing, Scoobeez had estimated assets and liabilities of between $10 million and $50 million while Scoobur had estimated assets and liabilities of less than $50,000. Menawhile, Scoobeez Global disclosed $6,274,654 in assets and $7,886,579 in liabilities. Foley & Lardner LLP is the Debtors' bankruptcy counsel. Conway Mackenzie, Inc., is the Debtors' financial advisor. The Office of the U.S. Trustee appointed a committee of unsecured creditors on May 20, 2019. The committee retained Levene, Neale, Bender, Yoo & Brill LLP as its counsel. SELECT MEDICAL: Moody's Rates $450MM Revolver Debt 'Ba2' -------------------------------------------------------- Moody's Investors Service assigned a Ba2 rating to Select Medical Corporation's $450 million senior secured revolving credit facility expiring in 2024. The rating agency also assigned a B3 rating to the new unsecured notes offering. There is no change to the Ba2 rating on the company's senior secured term loan, including the incremental term loan add-on. There is no change to the B1 Corporate Family Rating, B1-PD Probability of Default Rating or stable outlook on Select Medical Holdings Corporation. Proceeds from these transactions will be used to refinance existing debt and increase liquidity. Moody's expects that the added liquidity will be used to support the purchase of one-third of the stake in Concentra in February 2020 that Select Medical does not currently own. While there are no changes to ratings at this time, the additional amount of secured debt in the capital structure relative to the amount of unsecured debt puts downward pressure on the Ba2 senior secured rating. Going forward, incremental secured debt relative to unsecured debt could result in a downgrade to Select's senior secured rating. Ratings assigned: Select Medical Corporation Senior secured revolving credit facility expiring 2024 at Ba2 (LGD2) Unsecured notes due 2027 at B3 (LGD5) RATINGS RATIONALE Select Medical's B1 Corporate Family Rating is constrained by its moderately high leverage with debt/EBITDA of around 4.9 times. The company's critical illness recovery hospital and rehabilitation hospital segments, which rely predominantly on the Medicare program as a source of revenue, also face longer-term reimbursement risks. These two segments collectively generate roughly 54% of the company's earnings. Supporting the B1 CFR is Select Medical's significant scale, positive free cash flow, and leading positions in each of its business segments. Further, the company's outpatient rehabilitation and occupational medicine (Concentra) businesses provide diversity as both of these segments have strong payor and geographic diversity, with limited exposure to government payors. Moody's anticipates that most earnings growth over the next 12-18 months will come from acquisitions and associated synergies in the Concentra business as well as maturation of recently opened rehabilitation hospitals. The stable rating outlook reflects Moody's expectation that Select's debt/EBITDA will remain below 5.0 times, and that the Medicare reimbursement environment will be generally stable. The SGL-3 Speculative Grade Liquidity Rating reflects Moody's expectation that the company will operate with adequate liquidity during the next 12-18 months. Although the proposed refinancing transaction will help liquidity by restoring revolver capacity, Moody's anticipates $300-350 million of cash outflows in the first half of 2020 to fund the first of three put/call events to purchase portions of Concentra that it does not already own. The ratings could be downgraded if Select Medical experiences adverse developments in Medicare regulations or reimbursement that result in deterioration in margins or cash flow. A downgrade could also occur if the company undertakes material debt-financed acquisitions or shareholder initiatives, or if debt/EBITDA is sustained above 5.0 times. Weakening liquidity could also exert downward pressure on the ratings. The ratings could be upgraded if Moody's expects Select Medical to sustain both strong liquidity and debt/EBITDA below 4.0 times. Select Medical Corporation, headquartered in Mechanicsburg, PA, provides long-term acute care services and inpatient acute rehabilitative care through its critical illness recovery and rehabilitation hospital segments. Select also provides physical, occupational, and speech rehabilitation services through its outpatient rehabilitation segment. The company also has a majority interest in a joint venture with Welsh, Carson, Anderson & Stowe that includes the operations of Concentra Inc. Concentra is a provider of occupational and consumer healthcare services, including workers' compensation injury care, physical exams and drug testing for employers, and wellness and preventative care. Select Medical Corporation is a wholly owned subsidiary of Select Medical Holdings Corporation. Revenue is approximately $4.9 billion. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. SEVEN STARS: Seeks to Hire Kathleen A. Daly as Special Counsel -------------------------------------------------------------- Seven Stars on the Hudson Corp. seeks approval from the U.S. Bankruptcy Court for the Southern District of Florida to hire The Law Offices of Kathleen A. Daly, P.A. as its special counsel. The firm will represent the Debtor in a lawsuit against the landlord of the premises where it operates a trampoline amusement park. Kathleen Daly, Esq., the firm's attorney who will be providing the services, charges an hourly fee of $250. The retainer fee is $15,000, of which $5,000 was paid to the firm prior to the Debtor's bankruptcy filing. Ms. Daly disclosed in court filings that she and her firm do not hold any interest adverse to the Debtor and its bankruptcy estate. Ms. Daly maintains an office at: Kathleen A. Daly, Esq. The Law Offices of Kathleen A. Daly, P.A. 515 N. Flagler Drive, Suite P300 West Palm Beach, FL 33401 Phone: 561-293-8514 / 917-301-2437 Fax: 800-395-8692 Email: kdaly@kadalylaw.com About Seven Stars on the Hudson Corp. Seven Stars on the Hudson Corp. -- https://www.rockinjump.com/ftlauderdale/ -- is a trampoline park operator based in Fort Lauderdale, Fla. Seven Stars on the Hudson Corp. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-17544) on June 5, 2019. At the time of the filing, the Debtor had estimated assets of less than $500,000 and liabilities of between $1 million and $10 million. The case has been assigned to Judge Raymond B. Ray. The Debtor is represented by The Salkin Law Firm, P.A. SHANE TRACY: Taps Robleto Law as Legal Counsel ---------------------------------------------- Shane Tracy Enterprises, LLC received approval from the U.S. Bankruptcy Court for the Western District of Pennsylvania to hire Robleto Law, PLLC as its legal counsel. The firm will provide services in connection with the Debtor's Chapter 11 case, which include legal advice regarding its powers and duties under the Bankruptcy Code and the review of claims of creditors. The firm's hourly rates are: Aurelius Robleto Attorney $320 Renee Kuruce Attorney $270 Paralegals 110 Robleto Law and its attorneys are "disinterested" as defined in Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Aurelius P. Robleto, Esq. Renee M. Kuruce, Esq. Robleto Law, PLLC Three Gateway Center 401 Liberty Avenue, Suite 1306 Pittsburgh, PA 15222 Tel: (412) 925-8194 Fax: (412) 346-1035 Email: apr@robletolaw.com rmk@robletolaw.com About Shane Tracy Enterprises Shane Tracy Enterprises, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No. 19-22235) on June 2, 2019. At the time of the filing, the Debtor had estimated assets of less than $500,000 and liabilities of $100,000. The case is assigned to Judge Carlota M. Bohm. SOLUTIONS BY DESIGN: Aug. 14 Plan Confirmation Hearing ------------------------------------------------------ The Disclosure Statement explaining the Chapter 11 small business plan of reorganization of Solutions By Design Inc., is conditionally approved. A hearing for the consideration of the final approval of the Disclosure Statement and the confirmation of the Plan and of such objections as may be made to either will be held on August 14, 2019 at 2:00 PM at the U.S. Bankruptcy Court, U.S. Post Office and Courthouse Building, 300 Recinto Sur, Courtroom No. 1, Second Floor, San Juan, Puerto Rico. Any objection to the final approval of the Disclosure Statement and/or the confirmation of the Plan will be filed and served on/or before ten (10) days prior to the date of the hearing on confirmation of the Plan. A full-text copy of the Disclosure Statement is available at https://tinyurl.com/yxtv86js from PacerMonitor.com at no charge. About Solutions By Design Solutions By Design Inc., filed a Chapter 11 bankruptcy petition (Bankr. D.P.R. Case No. 18-06886) on Nov. 28, 2018, disclosing under $1 million in assets and liabilities. The case has been assigned to Judge Brian K. Tester. The Debtor is represented by Nilda M. Gonzalez Cordero, Esq., at Gonzalez Cordero Law Offices. SOTERA HEALTH: Moody's Affirms B3 CFR, Outlook Stable ----------------------------------------------------- Moody's Investors Service affirmed Sotera Health Topco, Inc.'s Corporate Family Rating at B3. Moody's downgraded the $450 million senior unsecured notes issued by Sotera Health Holdings LLC to Caa2 from Caa1. Sotera Topco's B3-PD Probability of Default Rating, the Caa2 rating of Sotera Topco's senior unsecured notes were also affirmed. Moody's affirmed the B1 ratings of Sotera Health's senior secured bank credit facility and assigned a B1 rating to the company's proposed $320 million incremental senior secured bank term loan. The outlook remains stable. Proceeds from the proposed $320 million incremental senior secured bank term loan will be used to fund a distribution to Sotera Topco's shareholder and fees and expenses. The affirmation of Sotera Topco's B3 Corporate Family Rating and the stable outlook reflects Moody's expectations leverage will remain high but will improve modestly over time primarily through continued growth in earnings. On a pro-forma basis, debt/EBITDA will rise to approximately 7.5 times from 6.6 times, as of the LTM period ending March 31, 2019. The downgrade of the senior unsecured notes issued by Sotera Health reflects the meaningful increase in secured debt in the company's capital structure following the issuance of the incremental term loan. Affirmations: Issuer: Sotera Health Topco, Inc. Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD $75 million Senior Unsecured Notes, Affirmed Caa2 (LGD6) $350 million Senior Unsecured Notes, Affirmed Caa2 (LGD6) Issuer: Sotera Health Holdings LLC Senior Secured Term Loan B, Affirmed B1 (LGD3) Senior Secured Revolving Credit Facility, Affirmed B1 (LGD3) Downgrades: Issuer: Sotera Health Holdings LLC Senior Unsecured Regular Bond/Debenture, Downgraded to Caa2 (LGD5) from Caa1 (LGD5) Assignments: Issuer: Sotera Health Holdings LLC Senior Secured Term Loan B, Assigned B1 (LGD3) Outlook Actions: Issuer: Sotera Health Holdings LLC Outlook, Remains Stable Issuer: Sotera Health Topco, Inc. Outlook, Remains Stable RATINGS RATIONALE Sotera Health Topco, Inc.'s B3 Corporate Family Rating reflects its expectations that leverage will remain above 6.5 times for the next 12 months. The company's credit profile is also constrained by environmental factors, notably around soil/water pollution and land use restrictions. These risks arise from the company's handling of toxic gases in its manufacturing process. The company's ratings also reflect aggressive financial policies with frequent debt-financed shareholder distributions. Sotera's ratings benefit from its leading position in the contract sterilization outsourcing market and the significant barriers to entry and meaningful customer switching costs. The company is reducing its reliance on device sterilization through acquisitions into new categories, such as the lab services sector. Sotera Health's profile also reflects its breadth of operations with no meaningful customer concentrations, a global footprint and a good liquidity profile. The stable outlook reflects Moody's expectations that any deleveraging will come primarily from modest EBITDA growth as free cash flow is likely be used to fund investments and shareholder returns. The stable outlook also reflects Moody's expectations financial policies will remain aggressive. Ratings could be upgraded if the company continues successful integrations of acquisitions. In addition, the company would need to maintain balanced financial policies such that debt/EBITDA would be sustained below 6.5 times. Ratings could be downgraded if free cash flow was expected to be negative, legal or environment risks increased substantially, or financial policies become increasingly aggressive. Ratings could be lowered if the company's liquidity profile were to erode. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Sotera Health, headquartered near Cleveland, OH, is a leading fully integrated provider of mission-critical health sciences, lab services and sterilization solutions for the healthcare industry. Sotera Health offers services in sterilization, lab and testing and gamma technologies. It operates through three main entities: Sterigenics, Nelson Labs and Nordion Inc. The company generates revenue in excess of $750 million. Sotera Health is majority-owned by private equity firm, Warburg Pincus International LLC with a minority interest held by GTCR LLC. SOUTH CENTRAL: City of Houston Objects to Disclosure Statement -------------------------------------------------------------- The City of Houston objects to the adequacy of the disclosure statement explaining the Chapter 11 plan of South Central Houston Action Council, Inc. Houston points out that in its Amended Plan of Reorganization, the Debtor did not include any mention of its rent payment obligation to Houston. Houston further points out that the Debtor filed Amended Schedules on May 30, 2019 and did not list an actual amount owed to Houston on its unexpired executory contract, but rather listed the claim in Schedule E/F for back rent as "disputed" and the claim amount as “unknown. About South Central Houston Action Council South Central Houston Action Council, Inc., which conducts business under the name Central Care Integrated Health Services, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Tex. Case No. 19-30371) on Jan. 28, 2019. At the time of the filing, the Debtor estimated assets of less than $50,000 and liabilities of less than $50,000. The case is assigned to Judge Jeffrey P. Norman. The Debtor tapped the Law Office of Nelson M. Jones as its legal counsel. No official committee of unsecured creditors has been appointed in the Chapter 11 case. STEARNS HOLDINGS: Files Blackstone-Sponsored Reorganization Plan ---------------------------------------------------------------- Stearns Holdings, LLC, and certain of its affiliates filed a Chapter 11 Plan of Reorganization and accompanying disclosure statement proposing that to the Plan, a Plan Sponsor will inject a new money investment into the Debtors to fund recoveries to holders of the 9.375% senior secured notes due August 15, 2020 pursuant to an indenture. On July 8, 2019, the Debtors and Blackstone entered into that certain investment agreement under which Blackstone agreed to be the Plan Sponsor and contribute $60 million of new money in exchange for 100% of the equity in Stearns upon the effective date of the Plan. The parties agreed that the Blackstone Investment Agreement would be subject to a competitive process to determine if there were higher or otherwise better investment proposals available for the Debtors. The New Money Investment will fund recoveries for the Company’s Notes holders in these Chapter 11 Cases. Class 5 General Unsecured Claims are impaired. General Unsecured Claims will not receive any distribution under the Plan. Class 4 Go-Forward Trade Claims are impaired. Allowed Go-Forward Trade Claims will receive cash in an amount equal to 95% of their allowed claim amount. Class 6 Artemis Note Claims are impaired. Artemis Note Claims will not receive any distribution under the Plan. Class 8 Existing Stearns Holdings Interests are impaired. Existing Stearns Holdings Interests will be cancelled. The Cash Flow DIP Facility will afford the Debtors liquidity to fund their operations, including payment of vendors, employee payroll, facilities rent, and other necessary expenses. The Debtors project that the Notes’ cash collateral likely will be sufficient to pay all, or substantially all, of such expenses. Accordingly, the Debtors anticipate limited need for the funding available under the Cash Flow DIP Facility. The Cash Flow DIP Facility nonetheless is essential to ensure the Debtors will have sufficient liquidity during these cases to honor all their post-petition obligations. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y2hufzzl from PacerMonitor.com at no charge. Proposed Counsel for the Debtors are Jay M. Goffman, Esq., Mark A. McDermott, Esq., Shana A. Elberg, Esq., Evan A. Hill, Esq., and Edward P. Mahaney-Walter, Esq., at Skadden, Arps, Slate, Meagher & Flom LLP, in New York. About Stearns Holdings Stearns Lending, LLC is a provider of mortgage lending services in Wholesale, Retail, Strategic Alliances, Non-Delegated Correspondent and Financial Institutions sectors throughout the United States. Stearns Lending is an equal housing lender and is licensed to conduct business in 49 states and the District of Columbia. Additionally, Stearns Lending is an approved HUD (United States Department of Housing and Urban Development) lender; a Single Family Issuer for Ginnie Mae (Government National Mortgage Association); an approved Seller/Servicer for Fannie Mae (Federal National Mortgage Association); and an approved Seller/Servicer for Freddie Mac (Federal Home Loan Mortgage Corporation). Stearns Lending is also approved as a VA (United States Department of Veterans Affairs) lender, a USDA (United States Department of Agriculture) lender, and is an approved lending institution with FHA (Federal Housing Administration). Stearns Lending is located at 4 Hutton Centre Drive, 10th Floor, Santa Ana, CA 92707. Stearns Holdings, LLC and six subsidiaries, including Stearns Lending, LLC, each filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 19-12226) on July 9, 2019. Stearns estimated assets of $1 billion to $10 billion and liabilities of the same range as of the bankruptcy filing. Stearns' cases have been assigned to the Honorable Shelley C. Chapman. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to Stearns, PJT Partners is serving as its financial advisor and Alvarez & Marsalis serving as its restructuring advisor. Prime Clerk LLC is the claims and noticing agent, maintaining the sites https://cases.primeclerk.com/stearns and http://www.stearnsrestructuring.com/ SUNTEC ALUMINUM: Aug. 12 Plan Confirmation Hearing -------------------------------------------------- The Disclosure Statement explaining the Chapter 11 Plan of Suntec Aluminum LLC is conditionally approved. The Court will conduct a hearing on confirmation of the Plan on August 12, 2019 at 2:30 p.m. in Tampa, FL − Courtroom 9A, Sam M. Gibbons United States Courthouse, 801 N. Florida Avenue. Any written objections to the Disclosure Statement will be filed and served no later than seven (7) days prior to the date of the hearing on confirmation. Objections to confirmation will be filed and served no later than seven (7) days before the date of the Confirmation Hearing. The Plan Proponent will file a ballot tabulation no later than 96 hours prior to the time set for the Confirmation Hearing. About Suntec Aluminum LLC Suntec Aluminum LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-01888) on March 6, 2019. At the time of the filing, the Debtor had estimated assets of less than $500,000 and liabilities of less than $1 million. The case has been assigned to Judge Caryl E. Delano. The Debtor is represented by the Law Office of Leon A. Williamson, Jr. P.A. TACTICAL SOLUTIONS: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Tactical Solutions Gear, LLC 2220 N Yager Rd Fremont, NE 68025-2793 Business Description: Tactical Solutions Gear, LLC provides safety and rescue equipment and clothing including law enforcement products, tactical cutlery, sports products, and laser engraving. Chapter 11 Petition Date: July 16, 2019 Court: United States Bankruptcy Court District of Nebraska (Omaha Office) Case No.: 19-81040 Judge: Hon. Shon Hastings Debtor's Counsel: John A. Lentz, Esq. LEPANT & LENTZ, PC, LLO 601 Old Cheney Rd., Ste. B Lincoln, NE 68512 Tel: (402) 421-9676 Email: john@lepantandlentz.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Craig A. Harbaugh, owner. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors. A full-text copy of the petition is available for free at: http://bankrupt.com/misc/neb19-81040.pdf TINTRI INC: Creditors' Committee Files Chap. 11 Plan of Liquidation ------------------------------------------------------------------- The Official Committee of Unsecured Creditors appointed in the Chapter 11 case of Tintri, Inc., filed a Chapter 11 plan of liquidation and accompanying disclosure statement for the Debtor. Class 5: General Unsecured Claims are impaired. Each Holder of an Allowed General Unsecured Claim will receive on account of such Allowed General Unsecured Claim such Holder's Pro Rata Share of any proceeds of the Liquidating Trust Assets. Class 3: Secured Lender Claims are impaired. The Holders of the Allowed Secured Lender Claims shall continue to receive distributions, from the Liquidation Trustee, of available Secured Lender Cash Collateral net of reserves/amounts for the Carve-Out and Committee Settlement as set forth in the Final DIP Order, as well as any Secured Lender Other Collateral, in full and final satisfaction, settlement, and release of each Allowed Secured Lender Claim. Class 6: Convenience Claims are impaired. Each Holder of an Allowed Convenience Claim will receive on account of such Allowed Convenience Claim 50% of such Holder's Allowed Convenience Claim. Class 7: Intercompany Claims are impaired. All Intercompany Claims will be cancelled and compromised, and Holders of Intercompany Claims shall receive no distribution on account of such Intercompany Claims. Class 8: Intercompany Interests are impaired. All Intercompany Interests will be cancelled and compromised, and Holders of Intercompany Interests shall receive no distribution on account of such Intercompany Interests. Class 9: Equity Interests are impaired. All Equity Interests in the Debtor will be cancelled and compromised, and Holders of Equity Interests shall receive no distribution on account of such Equity Interests. The Creditors' Committee believes that the Plan provides the best means currently available for the payment of claims from available assets. All Plan Expenses shall be charged against and paid from the Liquidation Trust. Court has scheduled a Confirmation Hearing for September 26, 2019 at 10:00 a.m. (Eastern). Any such objection must be filed and served on or before September 19, 2019, at 4:00 p.m. (Eastern). A full-text copy of the Disclosure Statement dated July 10, 2019, is available at https://tinyurl.com/yxcjwdb2 from PacerMonitor.com at no charge. Counsel for the Committee: Matthew P. Ward, Esq. Ericka F. Johnson, Esq. Morgan L. Patterson, Esq. WOMBLE BOND DICKINSON (US) LLP 1313 North Market Street, Suite 1200 Wilmington, DE 19801 Telephone: (302) 252-4320 Facsimile: (302) 252-4330 Email: matthew.ward@wbd-us.com ericka.johnson@wbd-us.com morgan.patterson@wbd-us.com About Tintri Inc. Tintri, Inc. -- http://www.tintri.com/-- is an enterprise cloud storage company founded in 2008 with the initial objective to solve the mismatch caused by using old, conventional physical storage systems with applications in virtual machine environments. The company provides large organizations and cloud service providers with an enterprise cloud platform that offers public cloud capabilities inside their own data centers and that can also connect to public cloud services. Tintri is headquartered at 303 Ravendale Drive, Mountain View, California 94043. The company has additional locations in McLean, Virginia; Chicago, Illinois, London, England; Munich, Germany; Singapore; and Tokyo, Japan. Tintri Inc. filed for Chapter 11 bankruptcy (Bankr. D. Del. Case No. 18-11625) on July 10, 2018. Kieran Harty, co-founder and chief technology officer, filed the petition. As of January 2018, the Debtor reported total assets of $76.25 million and total debt of $168 million. The Hon. Kevin J. Carey oversees the case. Pachulski Stang Ziehl & Jones LLP serves the Debtors' counsel. Wilson Sonsini Goodrich & Rosati is the Debtor's special corporate counsel. Houlihan Lokey acts as the Debtor's financial advisor, and Kurtzman Carson Consultants Inc. as the Debtor's claims and noticing agent. The Office of the U.S. Trustee formed an official committee of unsecured creditors on July 20, 2018. The Committee tapped Womble Bond Dickinson (US) LLP as its legal counsel. TJW FAMILY: Unsecured Creditors to Get Full Payment at 2.59% ------------------------------------------------------------ TJW Family Foods LLC filed a small business Chapter 11 plan and accompanying disclosure statement proposing that holders of general unsecured claims are unimpaired and will be paid in full on the effective date plus interest at the rate of 2.59%. Payments and distributions under the Plan will be funded by available cash and future revenue and operations of the Debtor. The Debtor shall be the disbursing agent under the Plan. The Debtor operates a restaurant under the name "Jo Jo's Philosophy" located at 169 Bleecker Street, New York, NY 10012. The restaurant is an American style bar and grill. A full-text copy of the Disclosure Statement dated July 10, 2019, is available at https://tinyurl.com/y46smksd from PacerMonitor.com at no charge. TJW Family Foods LLC filed a voluntary Chapter 11 petition (Bankr. E.D.N.Y. Case No. 19-40128) on January 9, 2019, and is represented by Lawrence Morrison, Esq., at Brian J. Hufnagel, Esq., at Morrison Tennenbaum, PLLC, in New York. TPC GROUP: S&P Upgrades ICR to 'B' on Refinancing; Outlook Stable ----------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on TPC Group Inc. and the ratings on the company's existing 2020 senior notes to 'B' from 'B-'. The recovery rating on the 2020 notes remains '4', reflecting S&P's expectation of average (30%-50%; rounded estimate 35%) recovery in the event of a payment default. S&P plans to withdraw issue-level ratings on the 2020 notes once the new proposed notes are funded and the 2020 notes are redeemed. At the same time, S&P assigned 'B' issue-level and '4' recovery ratings to the new $930 million in new senior secured notes due 2024, which TPC will issue to refinance its capital structure. The upgrade reflects TPC's meaningful financial improvement leading to strengthened credit metrics, resulting from increased reliability at its facilities and restructured contracts resulting in improved volumes. In addition, S&P believes TPC will benefit and continue to improve operating performance over the next 12 to 24 months as new ethylene capacity comes online in the U.S., leading to further increases in C4 processing volumes. In addition, the company is planning to restructure its capital with a new $930 million senior secured notes, with proceeds repaying existing debt and transaction related fees. S&P believes this leverage-neutral proposed refinancing mitigates any refinancing risk associated with the company's existing 2020 senior secured notes. S&P said, "The stable outlook reflects our view that TPC will continue to improve operating results and generate positive free cash flow on a sustained basis, benefiting from additional processing volumes due to new ethylene capacity coming online and improved contract structure. We believe the company is positioned to benefit from increases in U.S. olefin production and the resulting increase in crude C4 supply. We expect gradual improvement in demand based on U.S. GDP growth of 2.5% and 1.8% in 2019 and 2020, respectively. We expect TPC to continue to use cash flow to repay debt and improve credit measures such that debt to EBITDA will trend towards 5.0x on a weighted average basis. Our stable outlook does not consider any large debt-funded shareholder rewards or acquisitions. "We could take a negative rating action within the next 12 months if demand for butadiene materially weakens, possibly due to a slowdown in the auto sector, and the proposed U.S. olefin capacity expansions are significantly delayed. We could also lower the rating if there are unexpected operating issues at the company's two Gulf Coast facilities, leading to a 200 basis point (bp) decrease in margins resulting credit measures consistently above 6.5x for consecutive quarters. Additionally, if the refinancing does not close we could take a negative rating action as refinancing risk for the 2020 notes would increase. We could also take a negative rating action if the company were to pursue any large debt-funded dividend or acquisition. "We could raise the rating over the next year if the company continues to generate more revenue than we expect along with sufficient free cash flow to consistently reduce debt to EBITDA to less than 5x on a sustained basis, and the company's private equity owners demonstrated a stronger commitment to reducing and maintaining debt below 5x." This could occur if the company realizes stronger margins from improved prices—particularly for butadiene resulting in a 200 bps increase in margins. UPSTATE PHYSICIAN: Seeks to Hire Stephen M. Smith as Accountant --------------------------------------------------------------- Upstate Physician Services, PC seeks approval from the U.S. Bankruptcy Court for the Northern District of New York to hire Stephen M. Smith & Co., LLC as its accountant. The services to be provided by the firm include the preparation of monthly operating reports, statements of cash receipts and disbursements, financial statements, and tax filings. The firm's hourly rates are: Bookkeeper/Paraprofessional $125 - $175 Staff Accountant $275 Senior Manager/Junior Partner $375 - $475 Managing Partner $575 Stephen Smith, principal of the firm and the accountant who will be providing the services, disclosed in court filings that he is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Stephen M. Smith Stephen M. Smith & Co., LLC 509 Madison Avenue New York, NY 10022 Phone: 212-750-8161 About Upstate Physician Services Upstate Physician Services, PC -- https://www.upstatephysicians.com -- is a healthcare services provider in Troy, N.Y., offering acute, chronic and preventative care. Formed in 2014, Upstate Physician Services also specializes in child and adolescent psychiatry, general psychiatry, and psychotherapy. Upstate Physician Services filed a voluntary Chapter 11 petition (Bankr. E.D.N.Y. Case No. 19-42125) on April 10, 2019. On April 30, 2019, the case was transferred to the U.S. Bankruptcy Court for the Northern District of New York and was assigned a new case number (Case No. 19-10841). In the petition signed by Mustafain Meghani, M.D., president, the Debtor estimated $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Judge Robert E. Littlefield Jr. presides over the case. The Law Offices of Charles A. Higgs represents the Debtor as counsel. VALLEY ECONOMIC: Taps David Gottlieb as CRO ------------------------------------------- Valley Economic Development Center, Inc. received approval from the U.S. Bankruptcy Court for the Central District of California to hire David Gottlieb of D. Gottlieb & Associates, LLC as its chief restructuring officer. Mr. Gottlieb, managing member of D. Gottlieb & Associates, will provide these services in connection with the Debtor's Chapter 11 case: (a) analysis of the Debtor's loan portfolios (both as a lender and as a borrower) and analyze claims which are filed against the Debtor; (b) work with the Debtor's financial advisor and bankruptcy counsel to reach amicable resolutions with secured creditors regarding the ultimate disposition of their respective collateral; (c) work with the Debtor's financial advisor and bankruptcy counsel to negotiate amicable resolutions of disputed claims; (d) work with the Debtor's financial advisor and bankruptcy counsel to insure that the maximum recovery possible is obtained for all creditors, and to communicate and cooperate with creditors in this regard; (e) work with the Debtor's financial advisor and bankruptcy counsel to insure the Debtor's continued compliance with the requirements of the bankruptcy court, Bankruptcy Code, Bankruptcy Rules and the Office of the U.S. Trustee; (f) represent the Debtor as its senior officer in any proceeding or hearing before the bankruptcy court or the U.S. Trustee; (g) work with the Debtor's financial advisor and bankruptcy counsel to assist in the preparation of reports and other legal papers; (h) take possession of all estate funds, and be responsible for the disbursement of those funds and the timely payments of all fees and costs owing to the Clerk of the Court and the quarterly fees owing to the U.S. Trustee; and (i) serve as the estate's representative in connection with the sale or liquidation of the Debtor's assets, and negotiate, formulate, and prepare a plan of reorganization. The Debtor will pay the CRO an hourly fee of $625 and a post-petition retainer of $25,000. Mr. Gottlieb disclosed in court filings that he is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Mr. Gottlieb maintains an office at: David K. Gottlieb D. Gottlieb & Associates, LLC 17000 Ventura Blvd., Suite 300 Encino, CA 91316 Direct: 818.539.7980 Main: 818.539.7720 Fax: 818.436.0729 Email: dgottlieb@dkgallc.com About Valley Economic Development Center Valley Economic Development Center, Inc., a certified Community Development Financial Institution, is a California tax-exempt non-profit corporation whose mission is to provide financing assistance, management consulting, and training to entrepreneurs and small business owners in and around Los Angeles County and throughout California. Those services include business training for start-up and fledgling small businesses as well as services to more established existing small businesses. Valley Economic Development Center sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 19-11629) on July 2, 2019. At the time of the filing, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. The case is assigned to Judge Deborah J. Saltzman. Levene, Neale, Bender, Yoo & Brill L.L.P. is the Debtor's bankruptcy counsel. VALLEY RIVER: Taps Turner & Company as Accountant ------------------------------------------------- Valley River Brewery, LLC received approval from the U.S. Bankruptcy Court for the Western District of North Carolina to hire Turner & Company CPAs P.A. as its accountant. The firm will assist the Debtor in the preparation of tax returns, monthly status reports, disclosure statement and reports necessary to be submitted to state agencies. The hourly rates range from $55 to $75 for staff accountants and from $135 to 175 for principals and partners. Bookkeeping and payroll services average $55 per hour. Lawrence Turner, a member of Turner & Company, disclosed in court filings that the firm and its members and associates are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Turner & Company can be reached through: Lawrence C. Turner Turner & Company CPAs P.A. 31 Peachtree St. Murphy, NC 28906 Email: larry@myturnercpa.com About Valley River Brewery Valley River Brewery, LLC, filed a Chapter 11 bankruptcy petition (Bankr. W.D.N.C. Case No. 19-20033) on May 15, 2019, disclosing under $1 million in both assets and liabilities. Pitts Hay & Hugenschmidt, P.A. is the Debtor's counsel. VILLAGE RED: Unsecured Creditors to Get 0.35% Under Chapter 11 Plan ------------------------------------------------------------------- Village Red Restaurant Corp., d/b/a Waverly Restaurant, filed a Chapter 11 plan and accompanying disclosure statement proposing to pay the class of general unsecured creditors a pro-rata distribution of the remaining funds in the estate after payment of administrative and priority claims. The Debtor estimates that creditors will receive 0.35% of their allowed claims, payable on the effective date. Class 3 Equity interest holders are impaired. The holders of Class 3 Interests will receive no Distribution. On the effective date, all Class 3 Interests will be deemed canceled, null and void and of no force and effect. Payments and distributions under the Plan will be funded by the proceeds of the sale of the Debtor's assets in the amount of $100,000, which upon closing of the sale will be held in escrow by counsel to the Debtor. Morrison Tenenbaum PLLC shall be the disbursing agent under the Plan. A full-text copy of the Disclosure Statement dated July 10, 2019, is available at https://tinyurl.com/y23r8476 from PacerMonitor.com at no charge. The Plan was filed by Lawrence F. Morrison, Esq., and Brian J. Hufnagel, Esq., at Morrison Tenenbaum PLLC, in New York, on behalf of the Debtor. Village Red Restaurant Corp. filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 18-10960) on April 6, 2018, listing under $1 million in both assets and liabilities. The Hon. Michael E. Wiles oversees the case. Stuart P. Gelberg, Esq., serves as bankruptcy counsel to the Debtor. WALL TO WALL: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Three affiliates that concurrently filed voluntary petitions seeking relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Wall to Wall Tile & Stone, LLC (Lead Case) 19-32600 1500 D Street Vancouver, WA 98663-3439 Wall to Wall Tile & Stone-Oregon LLC 19-32599 1500 D Street Vancouver, WA 98663-4390 Wall to Wall Tile & Stone-Idaho LLC 19-32603 Business Description: Wall to Wall -- http://walltowallcountertops.com-- is a granite and quartz stones supplier in Vancouver, Washington. Chapter 11 Petition Date: July 16, 2019 Court: United States Bankruptcy Court District of Oregon (Portland) Judge: Hon. David W. Hercher Debtors' Counsel: Timothy J. Conway, Esq. TONKON TORP LLP 888 SW 5th Ave #1600 Portland, OR 97204 Tel: (503) 802-2027 Fax: (503) 972-3727 Email: tim.conway@tonkon.com - and - Michael W. Fletcher, Esq. TONKON TORP LLP 888 SW 5th Ave #1600 Portland, OR 97204 Tel: (503) 802-2169 Fax: (503) 972-3867 Email: michael.fletcher@tonkon.com - and - Albert N. Kennedy, Esq. TONKON TORP LLP 888 SW 5th Ave #1600 Portland, OR 97204 Tel: (503) 802-2013 (503) 972.3713 Email: al.kennedy@tonkon.com albert.kennedy@tonkon.com - and - Ava L. Schoen, Esq. TONKON TORP LLP 888 SW 5th Ave #1600 Portland, OR 97204 Tel: (503) 802-2143 Fax: (503) 972-3843 Email: ava.schoen@tonkon.com Wall to Wall Tile & Stone's Estimated Assets: $10 million to $50 million Wall to Wall Tile & Stone's Estimated Liabilities: $10 million to $50 million Wall to Wall Tile & Stone-Oregon's Estimated Assets: $100,000 to $500,000 Wall to Wall Tile & Stone-Oregon's Estimated Liabilities: $10 million to $50 million The petitions were signed by Tyler Kruckenberg, managing member. Full-text copies of two of the Debtors' petitions are available for free at: http://bankrupt.com/misc/orb19-32599.pdf http://bankrupt.com/misc/orb19-32600.pdf List of Debtors' 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Cosmos Granite Judgment $4,500,000 (West), LLC c/o Susman Godfrey LLP Attn: Rachel S. Black 1201 Third Ave. #3800 Seattle, WA 98101 Rachel S. Black Tel: 206-516-3880 Email: rblack@susmangodfrey.com 2. Cosentino Material $943,971 355 Alhambra Supplier Circle, Ste. 1000 Coral Gables, FL 33134 Tel: 786-686-5060 Email: karaf@cosentino.com 3. Batholite Natural Stone Material $688,849 302 Wellspring Ct. Supplier Hockessin, DE 19707 Harisha Koya Tel: 302-234-4448 4. Loyalty Enterprise Breach of $583,930 Development Contract Claim (Xinyang) Co., Ltd. c/o Green & Norwood PLLC Attn: Matthew Green 2722 Eastlake Ave E, #350 Seattle, WA 98102 Matthew Green Tel: 206-420-3486 Email: matt@gnlawseattle.com 5. Fortuna Granitos Corp Material $541,267 12614 Torbay Dr. Supplier Boca Raton, FL 33428 Tel: 561-945-6372 Email: roger@fortunagranitos.com 6. Caesarstone Material $505,360 POB 603791 Supplier Charlotte, NC 28260-3791 Tel: 980-960-2940 7. American Express Credit Card $372,542 POB 650448 Services Dallas, TX 75265-0448 Tel: 206-516-3880 8. Washington State Workers $281,771 Dept of Labor & Industry Compensation POB 44000 Insurance Olympia, WA 98504-4000 Tel: 360-902-5800 9. MS International, Inc. Material $166,180 5930 4th Ave. S. Supplier Seattle, WA 98108 Tel: 206-268-9200 10. Columbia Bank Credit Card $151,931 1301 A St. #100 Services Tacoma, WA 98402 Tel: 253-305-1940 11. Daltile Material $113,999 Attn: Bankruptcy Dept. Supplier 7834 C F Hawn Fwy Dallas, TX 75217 Email: jennifer.bliss@daltile.com 12. Carson Oil Vehicle $98,649 POB 6030 Services Portland, OR 97210 Tel: 503-224-8500 Email: info@carsonoil.com 13. Pental Granite & Marble Material $92,996 3900 A Industry, Drive E Supplier Fife, WA 98424 Mary Beth Ellis Tel: 253-344-5150 Email: marybethe@agmgranite 14. Granquartz Trade Debt $83,177 POB 1767 3950 Steve Reynolds Blvd Norcross, GA 30093 Tammy Doss Tel: 770-621-5213 Email: tdoss@granquartz.com 15. Heffernan Insurance Brokers Insurance $77,342 POB 4006 Services Walnut Creek, CA 94596 Tel: 925-934-8500 16. Stone Profit Software $73,942 Systems, Inc. Services U.S. Marketing & Sales Office 1629 N. Ashland Chicago, IL60622 Tel: 773-276-6000 Email: dylan@stoneprofits.com 17. Bedrosians Tile & Stone Material $66,683 4460 W. Shaw Ave, #197 Supplier Fresno, CA 93722 Gerard, credit dept. Tel: 559-275-9990 Email: gerard.credit@bedrosians.com 18. Lackmond Products Tools $59,451 POB 2045 Kennesaw, GA 30156 Tel: 770-919-2100 Email: rmathis@lackmond.com 19. Resolution Legal $58,400 Strategies LLP Services 515 NW Saltzman, Rd. #909 Portland, OR 97229 Tel: 503-226-2800 Email: admin@rsllp.us 20. Ferguson Enterprises, Inc. Supplies $41,002 ATTN: Credit Dept. Vendor 2250 N. Columbia Blvd. Portland, OR 97217 Tel: 503-283-333 Email: nwdistrict.admin@ferguson.com WEATHERLY OIL: Creditors' Committee Objects to Disclosure Statement ------------------------------------------------------------------- The Official Committee of Unsecured Creditors of Weatherly Oil & Gas, LLC, objects to the approval of the Disclosure Statement with Respect to Amended Plan of Liquidation of the Debtor. The Creditors' Committee asserts that the Debtor's failure to provide this basic information is fatal to the Second Amended Disclosure Statement's approval. The Committee points out that the Second Amended Disclosure Statement fails to provide any analysis of claims the Debtor has against Weatherly Operating, LLC ("OpCo") due to its unilateral decision to terminate the New MSA2 and the subsequent damage it caused to the Estate. According to the Committee, the Debtor's failure to disclose the nature of the claims being released is fatal to approval of the Second Amended Disclosure Statement. The Committee complains that the Second Amended Plan is unconfirmable on its face because: (1) it will be unable to achieve an impaired accepting class; and (2) it provides for improper third party releases under Fifth Circuit law. The Committee's objection was filed by Joseph E. Bain, Esq., and Megan Young-John, Esq., at Jones Walker LLP, in Houston, Texas; and Mark A. Mintz, Esq., and Laura F. Ashley, Esq., at New Orleans, Louisiana. About Weatherly Oil Weatherly Oil & Gas, LLC -- https://www.weatherlyop.com/ -- is a Fort Worth-based oil and natural gas company primarily focused on exploiting natural resources in the Ark-La-Tex region. Weatherly is operated by an affiliate Weatherly Operating, LLC. Weatherly Oil & Gas filed a voluntary petition under Chapter 11 of the US Bankruptcy Code (Bankr. S.D. Tex. Case No. 19-31087) on Feb. 28, 2019. In the petition signed by CRO Scott Pinsonnault, the Debtor estimated $50 million to $100 million in assets and $100 million to $500 million in liabilities. The Debtor tapped Jackson Walker LLP as its legal counsel; Tenoaks Energy Partners, LLC as sales agent; Ankura Consulting Group, LLC, as restructuring advisor; and Epiq Corporate Restructuring LLC as notice and claims agent. The Office of the U.S. Trustee on March 15 appointed three creditors to serve on the official committee of unsecured creditors in the Chapter 11 case of Weatherly Oil & Gas, LLC. The Committee retained Jones Walker LLP as counsel and Conway MacKenzie, Inc., as financial advisor. WEATHERLY OIL: Louisiana Objects to Disclosure Statement -------------------------------------------------------- The State of Louisiana, Department of Natural Resources, Office of Conservation, objects to the approval of the Disclosure Statement with Respect to Plan of Liquidation of Weatherly Oil & Gas, LLC. The State complains that the current Disclosure Statement does not provide the State any information on how these liabilities may be met, nor does the Plan allocate any funding to decommission these wells, so the State urges this Court to reject any Disclosure Statement proposed by the Debtors that fails to address how the Debtor will meet its environmental obligations to decommission these wells. The State asserts that the Disclosure Statement or Plan fails to address active wells in Louisiana, or seeks to allow the Debtor to abandon any wells located within Louisiana without providing for environmental obligations, they must be rejected. The State points out that the Disclosure Statement and Plan fail to provide any indication as to how the Debtor will meet these obligations. About Weatherly Oil Weatherly Oil & Gas, LLC -- https://www.weatherlyop.com/ -- is a Fort Worth-based oil and natural gas company primarily focused on exploiting natural resources in the Ark-La-Tex region. Weatherly is operated by an affiliate Weatherly Operating, LLC. Weatherly Oil & Gas filed a voluntary petition under Chapter 11 of the US Bankruptcy Code (Bankr. S.D. Tex. Case No. 19-31087) on Feb. 28, 2019. In the petition signed by CRO Scott Pinsonnault, the Debtor estimated $50 million to $100 million in assets and $100 million to $500 million in liabilities. The Debtor tapped Jackson Walker LLP as its legal counsel; Tenoaks Energy Partners, LLC as sales agent; Ankura Consulting Group, LLC, as restructuring advisor; and Epiq Corporate Restructuring LLC as notice and claims agent. The Office of the U.S. Trustee on March 15 appointed three creditors to serve on the official committee of unsecured creditors in the Chapter 11 case of Weatherly Oil & Gas, LLC. The Committee retained Jones Walker LLP as counsel and Conway MacKenzie, Inc., as financial advisor. WEST DEPTFORD: Moody's Rates New $500MM Secured Loans 'Ba3' ----------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to West Deptford Energy Holdings, LLC's proposed $500 million senior secured credit facilities, which consist of a $445 million 7-year senior secured term loan and a $55 million 5-year senior secured revolving credit facility. The outlook is stable. The Borrower owns the West Deptford Energy Station, a 744 MW gas-fired combined cycle electric generating facility located in West Deptford Township, NJ. Proceeds from the term loan will be used to refinance existing debt, pay transaction expenses, and make a distribution to a sponsor group that includes LS Power, along with subsidiaries of Marubeni Corporation (Baa2 stable), Kansai Electric Power Company, Incorporated (A3 stable), Ullico, Arctic Slope, Prudential/Lincoln, and Sumitomo Corporation (Perennial, Baa1, stable). RATINGS RATIONALE West Deptford's Ba3 rating reflects the Project's competitive generating profile; near-term cash flow visibility via cleared capacity revenues as well as tariff-based black-start and reactive power revenues; and a manageable leverage profile. The rating also considers the Project's operating track record, demonstrated financial performance, location in a premium capacity market as well as the experience and diversity of its sponsor group. These considerations are balanced against the project's single asset operating risk, inherent cash flow volatility stemming from its merchant power market exposure and uncertainty around the Project's emission cost relating to the state of New Jersey's re-entry into the Regional Greenhouse Gas Initiative (RGGI). Roughly 30% of West Deptford's annual revenues are derived from higher certainty revenues, including $119 million of cleared forward capacity payments through 2022 and $3.5 million per annum of long-term tariff revenue (black start and reactive power). The Project also has a revenue put expiring in December 2020 that provides downside protection through a baseline energy margin in the range of $30-35 million in 2019 and 2020. The West Deptford plant commenced operations in November 2014 and dispatches on a mid-merit basis. The project is competitively positioned on the NJ/PA border between Philadelphia and Trenton. Its location in the EMAAC capacity pricing zone affords it premium pricing. The project accesses natural gas from both the Transco Zone 6 Non-New York and TETCO M3 pipelines, with firm transportation contracted with South Jersey Resources Group and Mercuria Energy America, Inc. (as successor-in-merger to Noble Americas Gas & Power). Moody's does note that during portions of 2018 and 2019, the plant's capacity factors were negatively affected owing to some water quality issues for which the local municipal utility bears responsibility. While forced outage rates in 2018 and early 2019 have increased, Moody's understands that the municipality and the Project have implemented a plan to address these issues on a sustained basis. Projected credit metrics fall on the lower end of the Ba rating category under Moody's base case scenario, which uses SNL forward prices for power and gas and assumes flat capacity clearing prices in the 2022/23 year with incremental stepdowns thereafter. Anticipated leverage for the transaction is expected in the range of 5-6x Debt/EBITDA, with project cash flow from operations to debt at around 10% and debt service coverage ratios (DSCR) averaging around 2.0x. Financing Structure The senior secured credit facilities incorporate typical project finance features including limitations on indebtedness and asset sales, a trustee administered waterfall of accounts, a six month debt service reserve, a 1.1 times debt service coverage covenant requirement (calculated on a trailing 12 month basis) and a quarterly 75% excess cash sweep requirement that falls to 50% if Debt/EBITDA is less than 3.75 times. RATING OUTLOOK The stable outlook assumes that the Project will continue to exhibit strong operating performance and maintain solid energy margins at least in line with the project's average historical performance resulting in DSCR of around 2.0x and project cash flow to debt around 10%. Factors that could lead to an upgrade The rating could be upgraded if the Project improves energy margins such that it can demonstrate sustained projected cash flow to debt above 14% and is able to reduce leverage to below 5x. Factors that could lead to a downgrade The rating could be downgraded if market pricing conditions or operating performance issues result in a deterioration of credit metrics, such that project cash flow to debt fell below 10% and debt-to-EBITDA in excess of 6 times on a sustained basis. The principal methodology used in these ratings was Power Generation Projects published in June 2018. WEST DEPTFORD: S&P Assigns Prelim BB- Rating to $445MM Term Loan B ------------------------------------------------------------------ S&P Global Ratings assigned a preliminary 'BB-' rating to West Deptford Energy Holdings LLC's proposed $445 million senior secured term loan B due 2026. The preliminary '1' recovery rating indicates S&P's expectation of very high (90%-100%; rounded estimate: 95%) recovery in the event of default. S&P based this report on information as of July. 15, 2019. The rating is preliminary and subject to review of documentation. It will also depend on the final debt amount, amortization schedule, and interest rate. S&P expects to finalize the rating within 90 days. If S&P Global Ratings does not receive final documentation within a reasonable timeframe, or if the final documentation departs from materials reviewed, S&P Global Ratings reserves the right to withdraw or revise its ratings. WDE is paying down the existing term loan and replacing it with a new term loan. It intends to raise $445 million in senior secured term loan to partially fund a $90 million distribution to the sponsors, refinance the existing $347 million term loan balance (unrated), and fund transaction expenses. It used the existing term loan to fund the initial operation of the project. S&P said, "The stable outlook reflects our view that WDE will maintain high availability and dispatch generally in the 59% range. We expect operational performance to be in line with the technical consultant's forecast and capacity prices in 2022 and 2023 to clear at least $150 MW per day. We anticipate the 2019 DSCR to be 1.6x which is also the minimum DSCR over the life of the project. "We could lower the rating if the project were unable to maintain a minimum DSCR of 1.4x on a consistent basis. Due to the single-asset exposure, we could lower the rating based on a single, meaningful event. Additionally, a downgrade could stem from the deterioration of energy margins possibly caused by lower power demand or continued low commodity prices. We could also revise the outlook or lower the ratings if the project experienced unexpected operational issues that lead to an extensive unforced outage. "We could raise the ratings if we expect the project to maintain a minimum base-case DSCR of greater than 1.8x in all years, including during the post-refinancing period. This could stem from strong operational performance in addition to an increase in power and capacity prices in PJM." WEYERBACHER BREWING: Committee Seeks to Hire Financial Advisor -------------------------------------------------------------- The official committee of unsecured creditors of Weyerbacher Brewing Company, Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to hire Gavin/Solmonese, LLC as its financial advisor. The firm will provide services to the committee in connection with the Debtor's Chapter 11 case, which include reviewing the operation, financial condition and business plan of the Debtor; analyzing material agreements; evaluating the Debtor's capital structure; making recommendations to the committee with respect to the Debtor's effort to reorganize; and assisting the committee in marketing the Debtor's assets. Gavin/Solmonese has agreed to provide an across-the-board 20 percent discount on all fees billed in exchange for a $35,000 fee if a Chapter 11 plan is confirmed in the Debtor's bankruptcy case. The current hourly rates for the firm's professionals range from $250 to $700. Edward Gavin and Jeremy VanEtten, the professionals who will be providing the services, charge $700 per hour and $475 per hour, respectively. Edward Gavin, managing director of Gavin/Solmonese, disclosed in court filings that his firm has no connections with the Debtor, creditors or other "parties in interest." Gavin/Solmonese LLC can be reached through: Edward T. Gavin Gavin/Solmonese LLC 919 N. Market Street, Suite 600 Wilmington, DE 19801 Office: 302.655.8997 ext. 151 Mobile: 484.432.3430 Fax: 302.655.6063 Email: ted.gavin@gavinsolmonese.com About Weyerbacher Brewing Co. Weyerbacher Brewing Company, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Pa. Case No. 19-12558) on April 22, 2019. At the time of the filing, the Debtor estimated assets of between $1 million and $10 million and liabilities of between $1 million and $10 million. The case is assigned to Judge Richard E. Fehling. Ciardi Ciardi & Astin, P.C., is the Debtor's counsel. Andrew Vara, acting U.S. trustee for Region 3, appointed a committee of unsecured creditors on May 8, 2019. The Committee retained Elliot Greenleaf, P.C., and Loeb & Loeb LLP, as co-counsel. WILKENS 2003: IRS Objects to Plan Confirmation ---------------------------------------------- The United States of America, through its undersigned counsel and on behalf of its agency Internal Revenue Service (IRS), objects to confirmation of Wilkens 2003 Trust's Plan of Reorganization. The IRS asserts that the Debtor has not filed its federal income tax returns for the years 2014, 2015, 2016, 2017, or 2018. For each of those years (2014-2018), the IRS has filed an estimated claim because of the Debtor's failure to file the required tax returns. The IRS points out that the Debtor is in no position to adequately discuss the potential material Federal tax consequences of the Plan. The IRS further points out that the Debtor's Disclosure Statement contains no discussion whatsoever of the potential material tax consequences of the Plan. About Wilkens 2003 Trust Wilkens 2003 Trust, based in Incline Village, NV, filed a Chapter 11 petition (Bankr. D. Nev. Case No. 19-50122) on Jan. 31, 2019. In the petition signed by Timothy Wilkens, trustee, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in liabilities. The Hon. Bruce T. Beesley oversees the case. Stephen R. Harris, Esq., at Harris Law Practice LLC, serves as bankruptcy counsel. WILSON MANIFOLDS: KKR Objects to Disclosure Statement ----------------------------------------------------- Jan Kipnis, Scott Revell, and KKR Group, LLC, a Florida Limited Liability company (collectively "KKR"), objects to the approval of the disclosure statement explaining the Chapter 11 Plan of Wilson Manifolds, Inc. According to KKR, the document fails to contain sufficient and adequate information to allow a KKR to make an informed judgement about the plan. KKR points out that the Debtor has failed to adequately describe it post-petition financial condition to the Court by failing to file Monthly Operating Reports for December 2018, January 2019, April 2019, April 2019, May 2019 and June 2019. Attorneys for KKR: John D. Segaul, Esq. SEGAUL LAW FIRM, PA 300 S. Pine Island Rd., Suite 304 Plantation, Fl 33324 Tel: 954.424.3600 Email: jsegaul@segaul.com About Wilson Manifolds Inc. Wilson Manifolds, Inc. manufactures products for the automotive and racing industries. It specializes in custom-built and installed parts for high-performance vehicles. Wilson Manifolds sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-21658) on Sept. 21, 2018. The case is jointly administered with the Chapter 11 case of Keith D. Wilson, the company's president (Bankr. S.D. Fla. Case No. 18-21662). In the petition signed by Mr. Wilson, Wilson Manifolds estimated assets of less than $50,000 and liabilities of $1 million to $10 million. Wilson Manifolds tapped Hoffman, Larin & Agnetti, P.A. as legal counsel; Siegelaub, Rosenberg, Golding & Feller, P.A., as accountant; and Moecker Auctions, Inc. as appraiser. No official committee of unsecured creditors has been appointed. WOW WEE: Unsecured Creditors to Get Payment From Net Income ----------------------------------------------------------- Wow Wee, LLC, filed a Chapter 11 plan and accompanying disclosure statement proposing that holders of general allowed unsecured claims, classified in Class 6, which are impaired, will be paid, without interest, from the Plan Distribution Account, on a pro rata basis, after payment there from of (i) Class 1 Claims, (ii) the monthly Plan payments required to Class 2 Creditors, (iii) the monthly Plan payments to Class 3 Creditors, (iv) the monthly Plan payments required to the Class 4 Creditor, and (v) the monthly Plan payments required to Class 5 Creditors under the Plan. Class 4 - Claims of CFR are impaired. The Debtor will pay this creditor's Claims for any and all sums due under the Factoring Agreement in accordance with terms and provisions of the Factoring Agreement. As to the Note, the balance due on the Note is approximately $27,385.74, as of February 2, 2019, and the Debtor will pay the balance due under the Note in monthly installments of $1,500.00 each until the balance due thereon is paid in full. The monies generated or Net Income generated from the Debtor's business operations over a period of 60 months post-Effective Date shall be utilized to pay the Claims of Creditors as set forth in the Plan. A full-text copy of the Disclosure Statement dated July 9, 2019, is available at https://tinyurl.com/y4y9m2mt from PacerMonitor.com at no charge. About Wow Wee The business of Wow Wee, LLC, consists of the wholesale and retail sale of various "dipping sauces" that it produces at its facility in Cut Off, Louisiana. Wow Wee, LLC, filed a voluntary petition for relief under Chapter 11 of Title 11, United States Code (Bankr. E.D. La. Case No. 18-12729) on Oct. 12, 2018, estimating under $1 million in assets and liabilities. Darryl T. Landwehr, Esq., at Landwehr Law Firm, is the Debtor's counsel. WP CPP: S&P Affirms 'B' Issuer Credit Rating; Outlook Negative -------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on WP CPP Holdings LLC (CPP), and maintained the negative outlook. The rating affirmation follows CPP's announcement of the proposed financing for its acquisition of Pacific Cast Technologies, Inc. (ATI) and the sale of a stake in the business to a new investor, which will result in its recapitalization. S&P also affirmed the 'B' rating on the company's upsized $1.1 billion first-lien term loan due 2025 (upsized from $908 million). S&P's '3' recovery rating remains unchanged, reflecting its expectation of 50%-70% recovery (rounded estimate: 50%) in the event of a default. At the same time, S&P assigned its 'B' rating to the company's new $50 million delayed-draw first-lien term loan. The recovery rating is '3'. Additionally, S&P affirmed the 'CCC+' issue level rating on the company's upsized $356 million second-lien term loan due 2026 (upsized from $276 million). The recovery rating remains '6', reflecting S&P's expectation of 0%-10% recovery (rounded estimate: 0%) in the event of a default. S&P said, "We believe the company's debt will increase in 2019 to fund the acquisition of ATI and change in ownership, and the ratio of debt to EBITDA will remain above our downgrade trigger of 7x this year (specifically, in the 6.9x-7.3x range). However, we expect this ratio to improve below 7x (specifically 5.8x-6.2x) in 2020 with higher earnings. If revenues or earnings do not improve as we expect, possibly due to operational issues or the company pursuing larger-than-expected debt-financed acquisitions, debt to EBITDA could remain above our 7x downgrade trigger. "The negative outlook on CPP reflects S&P Global Ratings' expectation that the company's debt-to-EBITDA ratio will remain above 7x in 2019, pro forma for the acquisition of ATI and the recapitalization transaction. We expect it to decline to below 7x in 2020. However, we remain unsure about the pace and extent of the improvement, which could be weakened by unexpected integration issues, operational issues that impact earnings or cash flow, or other debt-financed acquisitions. "We could lower our ratings on CPP if 12 months after the transaction closes its debt-to-EBITDA remains above 7.0x and we do not expect it to improve. This could occur if there are integration issues with ATI or if the company's revenues or margins do not improve as expected. This could also occur if the company undertakes a larger debt-financed acquisition. "We could revise our outlook on CPP to stable in the next 12 months if its debt-to-EBITDA improves below 7x on a sustained basis. This could occur if the company successfully integrates ATI, profitably ramps up the production of its new products, pays down more debt than we expect, or its earnings and cash flow grow at a faster-than-anticipated pace due to increased demand." [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re Green Cure Bankr. C.D. Cal. Case No. 19-18001 Chapter 11 Petition filed July 10, 2019 Filed Pro Se In re Reliable Associates, Inc. Bankr. M.D. Fla. Case No. 19-06476 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/flmb19-06476.pdf represented by: David W. Steen, Esq. DAVID W. STEEN, P.A. E-mail: dwsteen@dsteenpa.com In re Kenneth W. Shiver and Abbie G. Shiver Bankr. N.D. Fla. Case No. 19-40353 Chapter 11 Petition filed July 10, 2019 represented by: Robert C. Bruner, Esq. BRUNER WRIGHT, P.A. E-mail: rbruner@brunerwright.com In re Gregory Louis Molden Bankr. E.D. La. Case No. 19-11864 Chapter 11 Petition filed July 10, 2019 represented by: Robin R. DeLeo, Esq. E-mail: deleolawfirm@northshoreattorney.com In re David Tenenbaum and Sarah R. Tenenbaum Bankr. D.N.J. Case No. 19-23330 Chapter 11 Petition filed July 9, 2019 represented by: Timothy P. Neumann, Esq. BROEGE, NEUMANN, FISCHER & SHAVER E-mail: timothy.neumann25@gmail.com In re Noodles Group Inc. Bankr. D.N.J. Case No. 19-23398 Chapter 11 Petition filed July 9, 2019 See http://bankrupt.com/misc/njb19-23398.pdf represented by: Paul Gauer, Esq. E-mail: gauerlaw@aol.com In re Luppino Homes LLC Bankr. D.N.J. Case No. 19-23457 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/njb19-23457.pdf represented by: Michael S. Kopelman, Esq. KOPELMAN & KOPELMAN LLP E-mail: kopelaw@kopelmannj.com In re DBS Investment LLC Bankr. D.N.J. Case No. 19-23459 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/njb19-23459.pdf represented by: Michael S. Kopelman, Esq. KOPELMAN & KOPELMAN LLP E-mail: kopelaw@kopelmannj.com In re B & L Builders LLC Bankr. D.N.J. Case No. 19-23460 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/njb19-23460.pdf represented by: Michael S. Kopelman, Esq. KOPELMAN & KOPELMAN LLP E-mail: kopelaw@kopelmannj.com In re DLZ LLC Bankr. D.N.J. Case No. 19-23462 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/njb19-23462.pdf represented by: Michael S. Kopelman, Esq. KOPELMAN & KOPELMAN LLP E-mail: kopelaw@kopelmannj.com In re 182 Fulton Avenue LLC Bankr. D.N.J. Case No. 19-23463 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/njb19-23463.pdf represented by: Michael S. Kopelman, Esq. KOPELMAN & KOPELMAN LLP E-mail: kopelaw@kopelmannj.com In re 119-27 165 Street Corp Bankr. E.D.N.Y. Case No. 19-44193 Chapter 11 Petition filed July 10, 2019 Filed Pro Se In re Carmen S. Henry Bankr. E.D.N.Y. Case No. 19-44194 Chapter 11 Petition filed July 10, 2019 represented by: David A. Bellon, Esq. LAW OFFICES OF DAVID A. BELLON, ESQ. E-mail: davidbellon010@gmail.com In re National Equity Service Holdings LLC Bankr. E.D.N.Y. Case No. 19-44201 Chapter 11 Petition filed July 10, 2019 Filed Pro Se In re 115 M, LLC Bankr. S.D.N.Y. Case No. 19-12253 Chapter 11 Petition filed July 10, 2019 Filed Pro Se In re Pro Tech Machining, Inc. Bankr. W.D. Pa. Case No. 19-10690 Chapter 11 Petition filed July 10, 2019 See http://bankrupt.com/misc/pawb19-10690.pdf represented by: Christopher M. Frye, Esq. STEIDL & STEINBERG E-mail: chris.frye@steidl-steinberg.com kenny.steinberg@steidl-steinberg.com In re Elizabeth W. Jones Bankr. S.D. Ala. Case No. 19-12348 Chapter 11 Petition filed July 11, 2019 represented by: J. Willis Garrett, Esq. E-mail: wgarrett@gallowayllp.com In re George Biasbas Villanueva Bankr. D.N.J. Case No. 19-23580 Chapter 11 Petition filed July 12, 2019 represented by: Thaddeus R. Maciag, Esq. MACIAG LAW, LLC E-mail: MaciagLaw1@aol.com In re Real Properties of NY LLC Bankr. E.D.N.Y. Case No. 19-44268 Chapter 11 Petition filed July 11, 2019 See http://bankrupt.com/misc/nyeb19-44268.pdf represented by: Solomon Rosengarten, Esq. SOLOMON ROSENGARTEN E-mail: VOKMA@aol.com In re Ekaterina Fokas Bankr. E.D.N.Y. Case No. 19-74929 Chapter 11 Petition filed July 11, 2019 represented by: Ronald D. Weiss, Esq. E-mail: weiss@ny-bankruptcy.com In re Lee Soon Su Bankr. E.D. Tex. Case No. 19-41858 Chapter 11 Petition filed July 11, 2019 represented by: Christopher J. Moser, Esq. QUILLING SELANDER LOWNDS WINSLETT MOSER E-mail: cmoser@qslwm.com In re SFO Investments, LLC Bankr. D. Id. Case No. 19-40662 Chapter 11 Petition filed July 12, 2019 See http://bankrupt.com/misc/idb19-40662.pdf represented by: Matthew Todd Christensen, Esq. ANGSTMAN JOHNSON, PLLC E-mail: mtc@angstman.com info@angstman.com In re Chu H. Kwon Bankr. E.D.N.Y. Case No. 19-44290 Chapter 11 Petition filed July 12, 2019 represented by: Charles E. Simpson, Esq. WINDELS MARX LANE & MITTENDORF E-mail: csimpson@windelsmarx.com In re East Broadway Mall, Inc. Bankr. S.D.N.Y. Case No. 19-12280 Chapter 11 Petition filed July 12, 2019 See http://bankrupt.com/misc/nysb19-12280.pdf represented by: Sarah M. Keenan, Esq. SFERRAZZA & KEENAN, PLLC E-mail: sally@skpllc.com In re Ioannis Kamitsis Bankr. S.D.N.Y. Case No. 19-23306 Chapter 11 Petition filed July 12, 2019 represented by: Lawrence Morrison, Esq. E-mail: lmorrison@m-t-law.com In re WyoComposites LLC Bankr. D. Wyo. Case No. 19-20446 Chapter 11 Petition filed July 12, 2019 See http://bankrupt.com/misc/wyb19-20446.pdf represented by: Paul K. Knight, Esq. KNIGHT LAW OFFICES LLC E-mail: paulknightattorney@gmail.com In re Inez Fernandez Sandejas Bankr. N.D. Cal. Case No. 19-30744 Chapter 11 Petition filed July 13, 2019 represented by: Arasto Farsad, Esq. FARSAD LAW OFFICES E-mail: FarsadECF@gmail.com In re Thomas Laws Bankr. D.N.M. Case No. 19-11629 Chapter 11 Petition filed July 12, 2019 represented by: Dennis A. Banning, Esq. Don F. Harris, Esq. NEW MEXICO FINANCIAL LAW E-mail: nmfl@nmfinanciallaw.com In re Maria Julia Higueros Bankr. C.D. Cal. Case No. 19-12739 Chapter 11 Petition filed July 15, 2019 represented by: Giovanni Orantes, Esq. ORANTES LAW FIRM PC E-mail: go@gobklaw.com In re JPGC Corp Bankr. C.D. Cal. Case No. 19-18191 Chapter 11 Petition filed July 15, 2019 See http://bankrupt.com/misc/cacb19-18191.pdf represented by: Katherine Butts Warwick, Esq. E-mail: kbwesq@pacbell.net In re Group 1 Enterprises, Inc. Bankr. E.D. Mich. Case No. 19-50245 Chapter 11 Petition filed July 15, 2019 See http://bankrupt.com/misc/mieb19-50245.pdf represented by: Robert N. Bassel, Esq. E-mail: bbassel@gmail.com In re Group 2 Enterprises, Inc. Bankr. E.D. Mich. Case No. 19-50246 Chapter 11 Petition filed July 15, 2019 See http://bankrupt.com/misc/mieb19-50246.pdf represented by: Robert N. Bassel, Esq. E-mail: bbassel@gmail.com In re Robust, LLC Bankr. E.D. Mo. Case No. 19-44377 Chapter 11 Petition filed July 15, 2019 See http://bankrupt.com/misc/moeb19-44377.pdf represented by: Spencer P. Desai, Esq. CARMODY MACDONALD P.C. E-mail: spd@carmodymacdonald.com In re Classic Ventures Group, LLC Bankr. E.D.N.C. Case No. 19-03206 Chapter 11 Petition filed July 15, 2019 See http://bankrupt.com/misc/nceb19-03206.pdf represented by: Travis Sasser, Esq. SASSER LAW FIRM E-mail: travis@sasserbankruptcy.com In re BBQ Chicken Don Alex, Inc. Bankr. E.D.N.Y. Case No. 19-44314 Chapter 11 Petition filed July 15, 2019 See http://bankrupt.com/misc/nyeb19-44314.pdf represented by: William R. Lizarraga, Esq. LIZARRAGA LAW FIRM, PLLC E-mail: wlizarraga@totallegalhelpteam.com In re Dorothy Giorgianni Bankr. E.D.N.Y. Case No. 19-74995 Chapter 11 Petition filed July 15, 2019 represented by: Ronald D. Weiss, Esq. E-mail: weiss@ny-bankruptcy.com In re Ronald Neil McKay Bankr. D. Oregon Case No. 19-32582 Chapter 11 Petition filed July 15, 2019 represented by: Theodore J. Piteo, Esq. MICHAEL D. O'BRIEN & ASSOCIATES E-mail: ted@pdxlegal.com In re Shane B. Kope Bankr. M.D. Pa. Case No. 19-03019 Chapter 11 Petition filed July 15, 2019 represented by: Craig A. Diehl, Esq. E-mail: cdiehl@cadiehllaw.com In re Jackie, LLC Bankr. E.D. Ark. Case No. 19-13670 Chapter 11 Petition filed July 16, 2019 See http://bankrupt.com/misc/areb19-13670.pdf represented by: Kevin P. Keech, Esq. KEECH LAW FIRM, PA Email: kkeech@keechlawfirm.com In re Mercedes Ortega Bankr. W.D.N.C. Case No. 19-30967 Chapter 11 Petition filed July 16, 2019 represented by: Dennis M. O'Dea, Esq. SFS LAW GROUP Email: dennis.odea@sfslawgroup.com In re J&G Diner Corp. Bankr. S.D.N.Y. Case No. 19-23321 Chapter 11 Petition filed July 16, 2019 See http://bankrupt.com/misc/nysb19-23321.pdf represented by: Lawrence Morrison, Esq. MORRISON TENENBAUM, PLLC Email: lmorrison@m-t-law.com info@m-t-law.com In re SIlvio's Italian Restaurant Inc. Bankr. S.D.N.Y. Case No. 19-23323 Chapter 11 Petition filed July 16, 2019 See http://bankrupt.com/misc/nysb19-23323.pdf represented by: Nathan Horowitz, Esq. NATHAN HOROWITZ, ESQ Email: nathan@nathanhorowitzlaw.com In re WWB Investments, Inc. Bankr. E.D. Pa. Case No. 19-14489 Chapter 11 Petition filed July 16, 2019 See http://bankrupt.com/misc/paeb19-14489.pdf represented by: Thomas Daniel Bielli, Esq. BIELLI & KLAUDER, LLC Email: tbielli@bk-legal.com In re J&D Construction, LLC Bankr. N.D. Tex. Case No. 19-70190 Chapter 11 Petition filed July 16, 2019 See http://bankrupt.com/misc/txnb19-70190.pdf represented by: John A. Leonard, Esq. LEONARD, KEY & KEY Email: lenbiz@rlklaw.net In re Patricia E.K. Schoenbachler Bankr. W.D. Wash. Case No. 19-42323 Chapter 11 Petition filed July 16, 2019 represented by: Jacob D. DeGraaff, Esq. HENRY & DEGRAAFF, P.S. Email: mainline@hdm-legal.com ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2019. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***