/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/200402.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, April 2, 2020, Vol. 24, No. 92 Headlines 239 CARNATION: Case Summary & 11 Unsecured Creditors 335 LAKE AVENUE: Voluntary Chapter 11 Case Summary A. MANOS SERVICES: April 22 Plan Confirmation Hearing Set A.J. MCDONALD: Unsecuerd Owed $315K to Split $60K in Plan ABC SOUTH: Second Amended Plan Confirmed by Judge ADVANCED INTEGRATION: Moody's Alters Outlook on B2 CFR to Neg. ADVANCED TEXTILES: April 28 Plan Confirmation Hearing Set ADVISOR GROUP: Fitch Lowers LT IDR to B- & Alters Outlook to Neg. AERKOMM INC: Incurs $7.98 Million Net Loss in 2019 AERO-MARINE: Proposes Sale of Non-Essential Equipment AI AQUA: Moody's Affirms 'B3' Corp. Family Rating, Outlook Stable AMERICAN COMMERCIAL: Seeks to Hire Porter Hedges as Co-Counsel API AMERICAS: Case Buying Laminates Business for $6 Million APOLLO ENDOSURGERY: Incurs $27.4 Million Net Loss in 2019 ARADIGM CORP: Selling Substantially All Assets to Grifols for $3.2M ASPEN LANDSCAPING: Wants Exclusivity Period Extended to Aug. 16 B2B TECH: Has Until June 15 to File Plan & Disclosure Statement BAILEY TOOL: 5th Cir. Affirms Lower Fees for Law Firm BASIM ELHABASHY: Selling Boca Raton Property for $1.1 Million BES LLC: April 20 Plan & Disclosure Hearing Set BRIGGS & STRATTON: Cutting Salaries for Executives & Employees BRIGHT MOUNTAIN: Two Directors Tender Resignations BRONX MIRACLE: Chapter 11 Trustee Can Padlock Property C & F STURM: Brandon Lew to Get Full Payment in Sale Plan CALIFORNIA PIZZA: Moody's Lowers CFR to Caa3, Outlook Negative CAVISTON INC: Second Amended Plan Confirmed by Judge CAYE SOUTH: Asks Court to Extend Exclusivity Period to June 16 CEDAR HAVEN: Exclusive Plan Filing Period Extended Through May 28 CHRISTOPHER HAMILTON: 3rd Party Not Covered by Stay, 9th Cir. Says COCRYSTAL PHARMA: Incurs $48.2 Million Net Loss in 2019 CODY LEE WILSON: Camping World Buying RV for $32K COMMUNITY MEMORIAL: Moody's Affirms Ba2 Rating on $334MM Debt COOL HOLDINGS: Delays Filing of Form 10-K Amid COVID-19 Pandemic CP#1109 LLC: May 12 Second Amended Plan & Disclosure Hearing Set DALLAS TRADING: Seeks to Hire Eric A. Liepins as Legal Counsel DASEKE COMPANIES: Moody's Cuts CFR to B3, On Review for Downgrade DEAN & DELUCA: Case Summary & 30 Largest Unsecured Creditors DIRECTVIEW HOLDINGS: Delays Filing of 2019 Annual Report DIVERSIFIED HEALTHCARE: Moody's Reviews Ba1 CFR for Downgrade DOVETAIL GALLERY: April 16 Plan & Disclosure Hearing Set DURA AUTOMOTIVE: Exclusive Period Extended to April 29 EDGEMERE, TX: Fitch Cuts Rating on $108MM Bonds to B+, Outlook Neg. EXELA TECHNOLOGIES: HandsOn Global Reports 50% Equity Stake FARWEST PUMP: Court Slashes $6,432 from Talwar Firm's Fees FGI ACQUISITION: Moody's Lowers CFR to Caa2, Outlook Negative GATEWAY CASINOS: S&P Cuts ICR to 'B-'; Ratings on Watch Negative GEMINI REALTY: Seeks to Hire Tavenner & Beran as Legal Counsel GEMSTONE SOLUTIONS: April 21 Plan Confirmation Hearing Set GLENVIEW HEALTH: RehabCare Objects to Plan Confirmation GOODRICH QUALITY: Taps Keller & Almassian as Legal Counsel GOODRICH QUALITY: Taps Stout Risius as Investment Banker GPS HOSPITALITY: Moody's Lowers CFR to Caa1, Outlook Negative GRAND SLAM: Case Summary & 8 Unsecured Creditors GRANITE US: S&P Lowers ICR to 'CCC+' on Covenant Concerns GREENHILL & CO: S&P Alters Outlook to Negative, Affirms 'BB' ICR GROM SOCIAL: Delays Form 10-K Filing Due to COVID-19 Pandemic HB2 LLC: April 23 Plan & Disclosure Hearing Set HELIX ACQUISITION: Moody's Places B3 CFR on Review for Downgrade IFRESH INC: Signs Purchase Agreement with Kairui Tong & Hao Huan IMPERIAL 290: Navika Buying Houston Property for $7.4M ISLAND VIEW: Trustee Selling Residential Units in Phase 1 JOFFE EMERGENCY: Seeks to Hire Havkin & Shrago as Legal Counsel JUNO USA: Exclusive Period to File Plan Extended Through June 16 KDJJ ENTERPRISES: Voluntary Chapter 11 Case Summary KONTOOR BRANDS: Moody's Alters Outlook on Ba2 CFR to Negative LASALLE GROUP: Exit Plan for Cinco Ranch, Pearland Confirmed LEE'S FOODSERVICE: Taps FactorLaw as Legal Counsel LESBRAN GROUP: Seeks to Hire Thomas E. Crowe as Legal Counsel LNB-002-2013: U.S. Bank Objects to Amended Plan & Disclosure LUNA DEVELOPMENTS: May 13 Plan & Disclosures Hearing Set MACON CONCRETE: Seeks to Hire Dean W. Greer as Legal Counsel METHANEX CORP: Fitch Lowers LongTerm IDR to BB, Outlook Negative METRO PUERTO RICO: Case Summary & 20 Largest Unsecured Creditors MOORE PROPERTIES: Court Okays Small Business Debtor Designation NEW GARDEN: Unsecured Creditors to Have 5% Recovery Under Plan NEW WAY TRANSPORT: May 19 Plan & Disclosure Hearing Set NFINITY GROUP: Amare Buying Phoenix Property for $260K NORTH VALLEY DERMATOLOGY: Trustee Taps Desmond Nolan as Counsel NORTIS INC: Taps Alvarez & Marsal to Provide Valuation Services NOVABAY PHARMACEUTICALS: Reports $9.66 Million Net Loss for 2019 OCEANEERING INT'L: Moody's Cuts CFR to B1, Alters Outlook to Stable PES HOLDINGS: Court Rules Priority Over Insurance Policies PESTOVA HOLDINGS: Chapter 7 Conversion or Case Trustee Sought PG&E CORP: Exclusive Solicitation Period Extended Until June 30 PG&E CORP: Further Fine-Tunes Plan & Disclosure Statement PHIO PHARMACEUTICALS: Incurs $8.91 Million Net Loss in 2019 PHUNWARE INC: Widens Net Loss to $12.9 Million in 2019 PIONEER HEALTH: Trustee Bid to Enforce Purchase Deal Okayed PRESSURE BIOSCIENCES: Delays Filing of 2019 Annual Report PRODIGY DIALYSIS: Has Until Aug. 24 to File Plan & Disclosures PROTEC INSTRUMENT: April 30 Plan & Disclosure Hearing Set PS HOLDCO: Moody's Places B2 CFR on Review for Downgrade PUBLIC BIKES: Voluntary Chapter 11 Case Summary R-DREAM FARM: Judge Extends Exclusivity Period to April 9 REGIONAL HEALTH: Reports $3.5 Million Net Loss for 2019 RENAISSANCE HEALTH: May 19 Plan & Disclosure Hearing Set ROLETTE COUNTY, ND: Moody's Alters Outlook on Ba1 Rating to Stable ROSA MARIA STYLES: Meles Buying Avalon Property for $3 Million SCIENTIFIC GAMES: Issues Statement on COVID-19 Response SCORPION FITNESS: CEO Balks at Chapter 11 Trustee Appointment SEARS HOLDINGS: Dist. Court Disallows Assignment of MOAC Lease SENIOR CARE: Passages Hospice Buying Hospice Equity for $750K SHERWIN ALUMINA: 5th Cir. Upholds Dismissal of Port's Fraud Claims SINTX TECHNOLOGIES: Reports $7.5 Million Net Loss for 2019 SKLAR EXPLORATION: Voluntary Chapter 11 Case Summary SOUTH ATLANTIC REGIONAL: Case Converted to Chapter 7 SPANISH BROADCASTING: Swings to $928,000 Net Loss in 2019 STAK DESIGN: Proposes Online Rosen Sale of Residual Assets STAK DESIGN: Proposes Rosen Sale of Residual Assets SUNCREST STONE: April 16 Plan Confirmation Hearing Set SUNCREST STONE: Unseccureds Owed $360K to Get $200K in Plan TARONIS TECHNOLOGIES: Delays Filing of Annual Report Over COVID-19 THERXSERVICES INC: April 23 Plan Confirmation Hearing Set THOMASRILEY STRATEGIES: Black Knight Buying Assets for $5K TIERPOINT LLC: Fitch Affirms B- LT IDR & Alters Outlook to Positive U.S. STEEL: Moody's Cuts CFR to Caa1 & Alters Outlook to Negative UNIT CORP: John Cromling to Retire as EVP of Unit Drilling UNITED STATES OF AMERICA RUGBY: Case Summary & Unsecured Creditors USREDA LLC: Bankruptcy Case Converted to Chapter 7 VESTAVIA HILLS: Commonwealth Assisted Living's Suit Goes to Calif. WILLIAMS PROPERTIES: Has Until April 30 to File Plan & Disclosures WOLVERINE WORLD: Moody's Alters Outlook on Ba1 CFR to Negative YUM BRANDS: Moody's Alters Outlook on Ba2 CFR to Negative [] S&P Alters Outlook on Transportation Infra Issuers to Negative [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* 239 CARNATION: Case Summary & 11 Unsecured Creditors ---------------------------------------------------- Debtor: 239 Carnation LLC 3857 Birch Street, Suite 350 Newport Beach, CA 92660 Business Description: 239 Carnation LLC is a Single Asset Real Estate (as defined in 11 U.S.C. Section 101(51B)), whose principal assets are located at 239 Carnation Avenue Corona Del Mar, CA 92625. Chapter 11 Petition Date: March 31, 2020 Court: United States Bankruptcy Court Central District of California Case No.: 20-11083 Judge: Hon. Scott C. Clarkson Debtor's Counsel: Jeffrey I. Golden, Esq. WEILAND GOLDEN GOODRICH LLP 650 Town Center Drive, Suite 600 Costa Mesa, CA 92626 Tel: (714) 966-1000 E-mail: jgolden@wgllp.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by Steve Perkins, member. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/0bCDtu List of Debtor's 11 Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Fineline Architectural Millwork Services $186,824 FitzGerald Yap Kreditor LLP 2 Park Plaza, Suite 850 Irvine, CA 92614 2. SoCal Stairs Services $109,772 15337 Allen Street Paramount, CA 90723 3. Keegan's Concrete, Inc. Services $105,283 990 W. 17th Street Costa Mesa, CA 92627 4. Nationwide Lifts Services $50,900 10 Holden Avenue, Suite B Queensbury, NY 12804 5. Coast Sheet Metal, Inc. Services $46,459 990 W. 17th Street Costa Mesa, CA 92627 6. Kirby Industries, Inc. Services $20,758 2109 S. Lyon Street Santa Ana, CA 92705 7. Bob Electric, Inc. Services $16,750 1539 Monrovia, #7 Newport Beach, CA 92663 8. Shawn Brown Painting, Inc. Services $11,575 12783 Newhope Street Garden Grove, CA 92840 9. Creative Design Services $7,101 Plumbing, Inc. 17271 Argo Circle Huntington Beach CA 92647 10. Orange County Services $4,460 Scaffold, Inc. 121 E. Meats Avenue Orange, CA 92865-3309 11.Gs SoilWorks Services $0 c/o Tucker Albin & Associates 350 Fisher Avenue Front Costa Mesa, CA 92626 335 LAKE AVENUE: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: 335 Lake Avenue, LLC 350 Market Street, Suite 311 Basalt, CO 81621 Business Description: 335 Lake Avenue, LLC is a Single Asset Real Estate (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: April 1, 2020 Case No.: 20-12378 Court: United States Bankruptcy Court District of Colorado Debtor's Counsel: Alex R. Hess, Esq. ALEX R. HESS LAW GROUP 245 First Street, 18th Floor, Riverview II Cambridge, MA 02142 Tel: (610) 730-9472 E-mail: Ahess@arhlawgroup.com Estimated Assets: $10 million to $50 million Estimated Liabilities: Unknown The petition was signed by James K. Daggs, manager of LLC. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors at the time of the filing. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/9h3T2S A. MANOS SERVICES: April 22 Plan Confirmation Hearing Set --------------------------------------------------------- Debtor A. Manos Services, Inc., a/k/a A. Manos Roofing, filed with the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, a Disclosure Statement. On March 13, 2020, Judge Michael G. Williamson conditionally approved the Disclosure Statement and established the following dates and deadlines: * April 22, 2020, at 10:00 a.m. in Tampa, FL − Courtroom 8A, Sam M. Gibbons United States Courthouse, 801 N. Florida Avenue is the hearing on confirmation of the Plan. * Parties-in-interest will submit to the Clerk's office their written ballot accepting or rejecting the Plan no later than eight days before the date of the Confirmation Hearing. * Objections to confirmation will be filed with the Court and served on the Local Rule 1007−2 Parties in Interest List no later than seven days before the date of the Confirmation Hearing. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/wcql44r from PacerMonitor at no charge. About A. Manos Services A. Manos Services, Inc. -- http://www.amanosroofing.com/-- is a small, family-owned and operated roofing company serving the Hillsborough, Pinellas, Pasco and Hernando counties. It specializes in roof leak repairs and roof replacement services. A. Manos Services sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-09721) on Oct. 14, 2019. At the time of the filing, the Debtor disclosed $1,377,003 in assets and $910,210 in liabilities. A.J. MCDONALD: Unsecuerd Owed $315K to Split $60K in Plan --------------------------------------------------------- Debtor A.J. McDonald Company, Inc., filed an Amended Disclosure Statement describing its Plan of Reorganization dated March 19, 2020. Class 3 secured claims will be treated as follows: * Daimler Truck Financial holds a Secured Claim that is secured by a 2016 Western Star Vacuum Truck. The Debtor will sell this vehicle to Robert F Beall & Sons, Inc for $51,000 and pay this claim in full from the proceeds of the sale. The net remaining proceeds of sale will be distributed to Class IV creditors on a pro rata basis. * Kubota Credit Corporation filed Claim No. 3-1 that is secured by a micro excavator. The Debtor will sell this vehicle to Robert F Beall & Sons, Inc for $10,000 and pay this claim in full from the proceeds of the sale. The net remaining proceeds of sale will be distributed to Class IV creditors on a pro rata basis. Class IV Unsecured Claims total $314,549.89, compared to $306,981.00 total claims from the previous iteration of the Plan. Unsecured creditors will share pro rata in approximately $60,000 to be distributed to Class IV creditors over the five year life of the Plan. The claim of Anthony J McDonald, an insider of the Debtor, will receive no distribution under the Plan. Plan payments will be derived from operating revenues and from the sales of the 2016 Western Star Vacuum Truck, the Kubota mini-excavator and the dump trailer. A full-text copy of the Amended Disclosure Statement dated March 19, 2020, is available at https://tinyurl.com/sr3zbgn from PacerMonitor at no charge. About A.J. McDonald Company A.J. McDonald Company, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 18-25670) on Nov. 29, 2018. At the time of the filing, the Debtor estimated assets of less than $500,000 and liabilities of less than $500,000. The case is assigned to Judge Robert A. Gordon. The Debtor tapped Jeffrey M. Sirody and Associates, P.A., as its legal counsel. ABC SOUTH: Second Amended Plan Confirmed by Judge ------------------------------------------------- Judge Jerry A. Brown entered an order confirming the Disclosure Statement and Second Amended Plan, with Immaterial Modifications, of debtor ABC South Consulting and Construction, LLC. Graystar will be fully authorized to immediately re-institute and to foreclose on the immovable property located at 1170 Clipper Drive, Slidell, Louisiana, with such sale taking place no earlier than May 1, 2020. Graystar will be fully authorized to re-institute the Writ of Seizure and Sale issued to the St. Tammany Sheriff in proceeding number 2018-14211 without the necessity of filing a new foreclosure suit. A full-text copy of the order dated March 12, 2020, is available at https://tinyurl.com/qlnhwat from PacerMonitor at no charge. About ABC South Consulting ABC South Consulting and Construction, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. La. Case No. 19-11650) on June 19, 2019. At the time of the filing, the Debtor was estimated to have assets of less than $1 million and liabilities of less than $500,000. Evan Park Howell III, Esq., is the Debtor's bankruptcy attorney. ADVANCED INTEGRATION: Moody's Alters Outlook on B2 CFR to Neg. -------------------------------------------------------------- Moody's Investors Service affirmed ratings for Advanced Integration Technology LP, including the company's B2 corporate family rating and B3-PD probability of default rating. Concurrently, Moody's affirmed the B2 ratings for the company's senior secured credit facilities. The ratings outlook has been changed to negative from stable. RATINGS RATIONALE The negative outlook reflects Moody's concerns that the disruptive effects of the coronavirus will create near-term sales and earnings pressures that will weaken AIT's financial profile. The negative outlook also considers AIT's relatively short-dated capital structure, with its revolving credit facility coming due in early-2021, as well as the company's unproven ability to consistently generate positive free cash flow. The B2 CFR reflects AIT's modest size, a relatively concentrated customer and platform base, and exposure to cyclical end markets. The rating also considers AIT's often lumpy and large-sized customer contracts that reduce cash flow visibility while adding an element of volatility to earnings. This earnings volatility is compounded by the use of percentage of completion accounting for most contracts which leads to ongoing and sometimes meaningful revisions to contract costs and profitability. Moody's recognizes AIT's moderately leveraged balance sheet and estimates adjusted debt-to-EBITDA of around 4x as of December 2019, as well as the company's diverse portfolio of automation and engineering capabilities and its growing exposure to defense end-markets that are likely to be less cyclical in nature. The rapid and widening spread of the coronavirus outbreak, the deteriorating global economic outlook, falling oil prices and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The aerospace sector has been adversely affected by the shock given its indirect sensitivity via the airline industry to consumer demand and market sentiment. More specifically, the weaknesses in AIT's credit profile, including its exposure to commercial aerospace, have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions, and AIT remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The actions reflect the impact on AIT of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. Factors that would lead to an upgrade or downgrade of the ratings: Factors that could lead to an upgrade include a demonstrated improvement in operational and financial execution on a sustained basis. Any upward rating action would be predicated on expectations of a conservative financial policy with Moody's-adjusted debt-to-EBITDA anticipated to be sustained below 3.75x. An upgrade would also be predicated on maintenance of a strong liquidity profile involving a largely undrawn revolver and consistent free cash generation such that FCF-to-Debt was expected to be consistently above 10%. Given the company's relatively small scale, Moody's would expect AIT to maintain credit metrics that are stronger than levels typically associated with comparatively larger companies at the same rating level. Factors that could lead to a downgrade include if AIT is unable to extend the maturity of its revolving credit facility well in advance of its expiration date of April 2021. The ratings could also be downgraded if AIT is not free cash flow positive during 2020, or if the company becomes more reliant on its revolver. The ratings could also be downgraded if debt-to-EBITDA (after Moody's standard adjustments) was expected to be sustained above 5.75x, or with any debt-financed distributions to shareholders or sizable debt-financed acquisitions over the near-term that would indicate a higher tolerance for financial risk. The following is a summary of the rating actions: Issuer: Advanced Integration Technology LP Corporate Family Rating, affirmed B2 Probability of Default Rating, affirmed B3-PD Senior Secured Bank Credit Facility, affirmed B2 (LGD3) Outlook, changed to Negative from Stable Advanced Integration Technology LP ("AIT"), headquartered in Plano, Texas, is a provider of turnkey factory automation and complex automated and non-automated tooling to the commercial aerospace and defense industries. AIT's primary business is to design, engineer, manufacture, and install machines and systems which enable the automated assembly of aerospace structures and other industrial equipment. The company is equally owned by management and funds affiliated with Onex Corporation. ADVANCED TEXTILES: April 28 Plan Confirmation Hearing Set --------------------------------------------------------- Debtors Advanced Textiles, LLC and Paul Honnen and Melissa Honnen filed with the U.S. Bankruptcy Court for the District of Arizona a First Amended Joint Disclosure Statement. On March 13, 2020, Judge Brenda K. Martin approved the Disclosure Statement and established the following dates and deadlines: * April 28, 2020, at 1:30 p.m. at the United States Bankruptcy Court, 230 N. First Avenue, 7th Floor, Courtroom 701, Phoenix, Arizona is the hearing to consider the confirmation of the plan. * Ballots accepting or rejecting the plan must be received by the Plan Proponents at least seven 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. * The written report of ballots by the Plan Proponents is to be filed three business days prior to the hearing date set for confirmation of the plan. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/ucg6l45 from PacerMonitor at no charge. The Debtors are represented by: Patrick F. Keery Keery McCue, PLLC 6803 E. Main Street, Ste. 1116 Scottsdale, AZ 85251 Advanced Textiles Advanced Textiles, LLC, was formed on or about June 25, 2009, for the purpose of manufacturing and manufacturing filtering materials for windows, doors, fans and HVAC systems. Advanced Textiles is recognized throughout the air filtering industry as a cutting-edge manufacturer, supplier and retailer of custom-made air filter products. Many of the products are sold online through an Amazon account. The company's only employee is Paul Honnen. Advanced Textiles has provided quality products to hundreds of customers for many years. Advanced Textiles sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 19-08428) on July 9, 2019. In the petition signed by its managing member, Paul Honnen, Advanced Textiles was estimated to have assets of less than $50,000 and debts of less than $1 million. On July 9, 2019, Paul Honnen and Melissa Honnen commenced their own Chapter 11 cases (Case No. 19-08429). The cases are assigned to Judge Brenda K. Martin. Advanced Textiles and the Honnens tapped Keery McCue, PLLC, as counsel. ADVISOR GROUP: Fitch Lowers LT IDR to B- & Alters Outlook to Neg. ----------------------------------------------------------------- Fitch Ratings has downgraded Advisor Group Holdings, Inc.'s Long-term Issuer Default Rating (IDR) to 'B-' from 'B'. Fitch has also downgraded the senior secured debt rating to 'B'/'RR3' from 'B+'/'RR3', and downgraded the senior unsecured debt rating to 'CCC'/'RR6' from 'CCC+'/'RR6'. The Rating Outlook has been revised to Negative from Stable. KEY RATING DRIVERS IDRs AND SENIOR DEBT The rating downgrade reflects Fitch's expectation that the impact of the coronavirus pandemic on financial markets will likely pressure Advisor Group's operating performance, and cause leverage to remain above the firm's long-term target of 5.0x for an extended period and pressure interest coverage. The revision of the Outlook to Negative from Stable reflects Fitch's view that the challenging economic environment, including declining asset prices and low interest rates, may lead to Advisor Group's inability to achieve projected profitability levels over the next 12-24 months, and higher leverage and weaker interest coverage for an extended period. The Negative Outlook also reflects uncertainties related to Advisor Group's ability to achieve planned cost reductions and synergies associated with the acquisition of Ladenburg Thalmann. Advisor Group's ratings continue to reflect its improving market position as one of the largest independent financial advisors in the U.S.; cash-generative business model; a relatively flexible cost base, which should help cushion revenue declines in the current environment; and high advisor retention rates. These points are counterbalanced against the elevated execution risks (integration, envisioned profitability levels and deleveraging) associated with the recent acquisition of Ladenburg Thalmann. The ratings are constrained by high leverage levels, weak interest coverage, and high operational, litigation and compliance risk associated with the independent broker-dealer and registered investment advisor (Hybrid RIA) business model. Additional rating constraints include the relatively high reliance on transactional revenues and Advisor Group's private equity ownership, which introduces a degree of uncertainty over the company's future financial policies and a potential for more opportunistic growth strategies. Fitch believes Advisor Group's earnings will come under pressure as a result of the Federal Reserve's decision to lower its targeted benchmark interest rate, leading to lower net interest income (NII) on cash balances held in sweep accounts and other asset-based fees. These factors could be partially offset by execution on planned synergies from the Ladenburg acquisition and utilization of other costs savings opportunities, given lower advisor attrition and reduced recruiting expenses. Fitch estimates that Advisor Group's adjusted EBITDA margin will decline, as lower net revenues are only partially offset by cost reductions. However, the margin is expected to remain around the lower-end of Fitch's 'bb' quantitative benchmark range for securities firms with low balance usage of 10% to 20%. Advisor Group's cash flow leverage, as expressed by gross debt to EBITDA (adjusted for non-cash and non-recurring items) was 7.4x for TTM ended Sept. 30, 2019, well-above the firm's long-term target of 5.0x. Fitch had expected leverage to decline towards a longer-term target of around 5.0x over the Outlook horizon, driven by EBITDA expansion, stemming from organic growth and the realization of synergies from the Ladenburg acquisition. However, current market conditions are expected to delay the firm's ability to execute against that target. Interest coverage is expected to decline below 2.0x near term, which is viewed as relatively weak and within Fitch's 'b and below' category benchmark range of below 3.0x for securities firms with low balance sheet usage. Still, liquidity risks are partially offset by the relatively long-term maturity profile of the firm's debt (nearest repayment in 2026) and the cash generative business model. Advisor Group had cash and net excess capital of around $281 million at Sept. 30, 2019 and maintains a $325 million five-year secured revolving credit facility, which is currently undrawn. The senior secured debt rating is notched up once from the Long-Term IDR and reflects Fitch's view of above average recovery prospects under a stress scenario. The senior unsecured rating is two notches below the IDR and reflects structural subordination and poor recovery prospects under a stress scenario. RATING SENSITIVITIES IDRs AND SENIOR DEBT Further deterioration in operating results, beyond current expectations, that prevent Advisor Group from making progress toward reducing leverage to 6.5x or below and interest coverage to at least 2.0x, over the Outlook horizon, will likely result in a ratings downgrade. Negative rating actions could also result from an inability to achieve identified cost savings and envisioned synergies associated with the Ladenburg acquisition; material declines in advisor and asset retention rates; and/or a material increase in balance sheet-intensive activities. The Outlook revision to Stable from Negative will be conditioned on the reduction of leverage to 6.5x or below and interest coverage improving to 2.0x or more on a sustained basis. The successful integration of Ladenburg, as evidenced by strong asset retention and the achievement of projected cost reductions, while maintaining a balance-sheet light business model and sound operating performance, would also be viewed favorably. The secured and unsecured debt ratings are primarily sensitive to changes in Advisor Group's IDR and secondarily to recovery prospects under a stressed scenario. BEST/WORST CASE RATING SCENARIO Best/Worst Case Rating Scenarios - Financial Institutions: Ratings of Financial Institutions issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. ESG CONSIDERATIONS ESG issues are credit neutral or have only a minimal credit impact on the entity(ies), either due to their nature or the way in which they are being managed by the entity(ies). AERKOMM INC: Incurs $7.98 Million Net Loss in 2019 -------------------------------------------------- Aerkomm Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $7.98 million on $1.60 million of total revenue for the year ended Dec. 21, 2019, compared to a net loss of $8.15 million on $1.74 million of total revenue for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $49.99 million in total assets, $4.17 million in total liabilities, and $45.82 million in total stockholders' equity. As of Dec. 31, 2019, the Company had cash and cash equivalents of $976,829. To date, the Company has financed its operations primarily through cash proceeds from financing activities, including from its 2018/2019 public offering, short-term borrowings and equity contributions by its stockholders. Net cash used for operating activities was $8,729,319 for the year ended Dec. 31, 2019, as compared to $7,031,994 for the year ended Dec. 31, 2018. In addition to the net loss of $7,979,559, the increase in net cash used for operating activities during the year ended Dec. 31, 2019 was mainly due to increase in inventory and prepaid expenses, decrease in accounts payable and other payable – others of $2,143,550, $1,435,164, $1,120,245 and $834,783, respectively, offset by the decrease in accounts receivable and temporary deposit – related parties of $1,293,870 and $100,067, respectively. In addition to the net loss of $8,148,340, the increase in net cash used for operating activities during the year ended Dec. 31, 2019 was mainly due to increase in accounts receivable and prepaid expenses and decrease in other payable – others of $1,745,000, $1,171,356 and $887,956, respectively, offset by the decrease in other receivable – others and increase in accounts payable of $409,774 and $2,032,974, respectively. Net cash used for and provided by investing activities for the year ended Dec. 31, 2019 was $635,293 as compared to $34,583,195 for the year ended Dec. 31, 2018. The net cash used for investing activities for the year ended Dec. 31, 2019 was mainly due to the $624,462 final payment toward the purchase of a parcel of land to build the Company's first satellite ground station and data center. The Company also used $10,831 for the purchase of property and equipment. Net cash provided by financing activities for the years ended Dec. 31, 2019 and 2018 was $10,855,735 and $41,558,566, respectively. Net cash provided by financing activities for the year ended Dec. 31, 2019 was mainly attributable to net proceeds from the issuance of common stock from the Company's public offering and the borrowing under a long-term loan in the amounts of $10,810,688 and $45,469, respectively. A full-text copy of the Form 10-K is available for free at: https://is.gd/zeVHVG About Aerkomm Headquartered in Nevada, USA, Aerkomm Inc. -- http://www.aerkomm.com/-- is a full-service development stage provider of in-flight entertainment & connectivity (IFEC) solutions, intended to provide airline passengers with a broadband in-flight experience that encompasses a wide range of service options. Those options include Wi-Fi, cellular, movies, gaming, live TV, and music. The Company plans to offer these core services, which it is currently still developing, through both built-in in-flight entertainment systems, such as a seat-back display, as well as on passengers' own personal devices. AERO-MARINE: Proposes Sale of Non-Essential Equipment ----------------------------------------------------- Aero-Marine Technologies, Inc. asks the Bankruptcy Court for Middle District of Florida to authorize the sale of non-essential equipment listed on Exhibit A through an absolute auction free and clear of all liens, claims, and encumbrances. Prior to the filing of these Chapter 11 cases, (i) the Debtors and Central Bank executed the Loan and Security Agreement, pursuant to which the Lender agreed to extend to the Debtors a line of credit with a maximum availability of $5 million, and (ii) the Debtors executed in favor of the Lender the Promissory Note in the original principal amount of $5 million. Pursuant to the Loan Agreement, the Debtor granted to the Lender a lien on all of the assets of the Debtor, including, but not limited to, accounts receivable, to secure the indebtedness under the Loan Documents. As of the Petition Date, the Lender claims to be owed approximately $4.7 million. The Debtor believes that the Lender may assert liens on and security interests in all of its assets, including the Equipment. The Debtor is not aware of any other security interests on the Equipment. On Nov. 19, 2019, the Debtor filed its application to for authorization to employ Moecker Auctions, Inc. as an appraiser. On Feb. 19, 2020, the Debtor filed its motion to modify the terms of employment of the Auctioneer to sell the Equipment. At the present time, the Debtor contemplates the Auction to be conducted by the Auctioneer beginning at 8:00 a.m. (EST) on March 17, 2020. The Auctioneer will transfer title to the Equipment in "as is" condition and will not make any warranties as to the operation of the Equipment. For example, all inventory of airline parts and components are in unairworthy condition with no records of trace, times or cycles, and should be designated as scrap rather than purchased as if in an airworthy condition under FAA guidelines. The net auction proceeds, after payment of Auctioneer's 15% of on-site sales and 18% of on-line sales in compensation, will be paid to Central Bank to reduce its claim. The Debtor asks that the Court waives the 14-day stay set forth in Rule 6004(g) of the Federal Rules of Bankruptcy Procedure and provide that the order granting the Motion be immediately applicable. A copy of the Agreement and the Exhibit A is available at https://tinyurl.com/tls6bxv from PacerMonitor.com free of charge. About Aero-Marine Technologies Aero-Marine Technologies, Inc. -- https://www.aero-marinetechnologies.com/ -- provides total support for waste and water system components found on Boeing, Airbus and Embraer aircraft. Aero-Marine Technologies is a full-service Maintenance, repair and overhaul (MRO) with a worldwide customer base. Aero-Marine Technologies sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-07547) on Aug. 9, 2019. The Debtor's case is jointly administered to that of Joseph N. Vaughn and Theresa L. Vaughn. In the petition signed by Joseph N. Vaughn, president, Aero-Marine's assets are estimated at $500,000 to $1 million, and its liabilities at $1 million to $10 million. The Hon. Caryl E. Delano is the case judge. Stitchler, Riedel, Blain & Postler, P.A. is the Debtor's legal counsel. AI AQUA: Moody's Affirms 'B3' Corp. Family Rating, Outlook Stable ----------------------------------------------------------------- Moody's Investors Service affirmed the ratings of AI Aqua Merger Sub, Inc. including the company's Corporate Family Rating at B3, and Probability of Default Rating at B3-PD. Moody's also affirmed the B2 ratings on the first lien senior secured credit facilities, including the proposed term loan upsize, issued by the company and its Australian subsidiary AI Aqua Zip Bidco Pty Ltd., and the Caa2 rating on the company's second lien senior secured credit facility. At the same time, Moody's assigned B2 ratings to the company's proposed $225 million senior secured first lien revolver, and $50 million delayed draw senior secured first lien term loan. The company's and its Australian subsidiary's outlook is stable. Proceeds from the proposed $300 million incremental first lien term loan, along with proceeds from the sale of AquaVentures' Seven Seas business segment, and a significant new equity contribution from the company's financial sponsors Advent International and Centerbridge Partners, will be used to help fund the previously announced acquisition of AquaVentures (not rated) in a transaction valued at approximately $1.1 billion. Moody's estimates pro forma for the transactions, including the divestiture of Seven Seas, Culligan's financial leverage on a debt/EBITDA basis at 6.8x for the fiscal year-end period December 31, 2019, which is the same level compared to Moody's prior estimate when the transaction was announced in December 2019. The proposed $50 million delay draw first lien term loan will be available for 24 months and can only be drawn if pro forma leverage is at or below closing leverage. Moody's expects the delayed draw term loan facility and continued sponsor equity contributions will be used to fund future tuck-in acquisitions. The company also upsized its first lien senior secured revolver to $225 million from $115 million, and extended the maturity to December 2023. Affirmations: Issuer: AI Aqua Merger Sub, Inc. Probability of Default Rating, Affirmed B3-PD Corporate Family Rating, Affirmed B3 Senior Secured 1st Lien Bank Credit Facility (including proposed $300 million term loan upsize), Affirmed B2 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa2 (LGD5) Issuer: AI Aqua Zip Bidco Pty Ltd. Senior Secured 1st Lien Bank Credit Facility, Affirmed B2 (LGD3) Assignments: Issuer: AI Aqua Merger Sub, Inc. Guaranteed Senior Secured 1st Lien Delayed Draw term Loan, Assigned B2 (LGD3) Guaranteed Senior Secured 1st Revolvng Credit Facility, Assigned B2 (LGD3) Outlook Actions: Issuer: AI Aqua Merger Sub, Inc. Outlook, Remains Stable Issuer: AI Aqua Zip Bidco Pty Ltd. Outlook, Remains Stable RATINGS RATIONALE Culligan's B3 CFR reflects the company's high financial leverage, weak quality-of-earnings, aggressive growth through acquisition strategy that pressures free cash flow generation, and the relatively short history of operating at the post acquisition revenue and operating scope with revenue more than tripling since December 2016 leverage buyout. Pro forma for the proposed acquisition of AquaVenture's Quench segment and including pro forma credit for other tuck-in acquisitions, Culligan's financial leverage is high with debt/EBITDA at around 6.8x for the fiscal year-end period December 31, 2019. The company's aggressive growth through acquisitions strategy, which is expected to continue longer term but will likely slow during the coronavirus outbreak, adds volatility to leverage and results in large amounts of ongoing pro forma add-backs to reported EBITDA. Moody's estimates the company's pro forma debt-to-EBITDA leverage on a reported basis is in excess of 12x. Furthermore, a material portion of these add-backs involve cash flows that weaken free cash flow, and the magnitude of the gap between reported and the company's adjusted results create sizable variation around projected credit metrics and free cash flow. As the company integrates acquisitions and grows in scale, a reduction in future acquisition related costs should support positive free cash flow in 2020 and a reduction in reported debt-to-EBITDA leverage below 7.0x within two years. Culligan's rating also reflects the company's strong market position, increased segment diversification bolstered by the Quench acquisition, the high level of recurring revenue, and good geographic diversification. Both Culligan and AquaVenture's Quench segment have strong market positions in the residential and office drinking water markets, respectively. Around 60% of the combined company's revenue is recurring in nature, which offers earnings visibility and also supports the credit profile. The sponsor financial support through partial equity funding of acquisitions helps to somewhat mitigate the integration, leverage and cash flow risks of the transactions, and the rating also reflects Moody's expectation that this financial support will continue. Culligan's liquidity is adequate, characterized by modest cash on hand of around $50 million, weak free cash flow generation, access to an undrawn $225 million revolving credit facility due 2023, and a lack of meaningful near term maturities until 2023, which provides some level of financial flexibility as the company executes its growth through acquisitions strategy over the next year. Governance factors include the risk associated with the company's ownership by a private equity sponsor, which increases the risks of shareholder friendly financial policies, and the inherent risks associated with executing an acquisition of this size on top of other recent sizable acquisitions. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The drinking water product and service category should partially benefit from a stay at home environment. However, a deteriorating operating environment, along with increased unemployment and lower consumer confidence as a result of the coronavirus outbreak, will negatively impact demand for the company's products. The stable outlook reflects that the reduction in leverage pro forma for the transaction will help mitigate the potential variation around projected operating results and credit metrics because of the large number of EBITDA adjustments and likely continued acquisition activity. Moody's also expects the company will continue to execute its acquisition strategy prudently with minimal disruption both operationally and to credit metrics with continued support from its financial sponsors, and that the company will generate positive free cash flow in fiscal 2020. Moody's assumes mixed effect from coronavirus with some net negative impact, but overall operating results should hold up relatively well because of consumer demand for safe drinking water. Ratings could be upgraded if the company sustainably achieves strong organic revenue and EBITDA growth with a narrowing gap between reported US GAAP and management-adjusted results (particularly EBITDA). To be upgraded, the company would also need to reduce and sustain debt/EBITDA below 5.5x, generate meaningfully positive free cash flow, adhere to financial strategies that support credit metrics at those levels, and maintain good liquidity. Factors that would lead to an upgrade or downgrade of the ratings: Ratings could be downgraded if the company's operating performance weakens, financial policies become more aggressive, or debt/EBITDA is sustained above 7.0x. The ratings could also be downgraded if the company fails to generate positive free cash flow on an annual basis or liquidity deteriorates. Headquartered in Rosemont, Illinois, AI Aqua Merger Sub, Inc. (dba Culligan) through its subsidiaries operates as a global manufacturer and distributor of water treatment products and services for household, commercial and industrial applications. AI Aqua Merger Sub, Inc. is a wholly-owned subsidiary of Al Aqua Sárl (Parent and Guarantor). The company is private and majority owned by Advent International, and it does not disclose its financial information. AI Aqua Merger Sub, Inc., pro forma for the proposed acquisition of AquaVenture's Quench segment and recently closed acquisitions generated revenue of roughly $1.4 billion in the fiscal year-end period December 31, 2019. AMERICAN COMMERCIAL: Seeks to Hire Porter Hedges as Co-Counsel -------------------------------------------------------------- American Commercial Lines, Inc., seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Porter Hedges LLP. Porter Hedges will serve as co-counsel with Milbank LLP, the other firm tapped to handle the Chapter 11 cases filed by American Commercial Lines and its affiliates. The firm's hourly rates range as follows: Low/High -------- Partners $545/925 Of Counsel $375/825 Associates/Staff Attorneys $420/590 Paralegals $235/380 During the one year prior to the Debtors' bankruptcy filing, Porter Hedges received $75,000 in total compensation for fees and expenses related to the Debtors' restructuring and other matters. As of Feb. 7, the balance of the retainer was $63,877. John Higgins, Esq., a partner at Porter Hedges, disclosed in court filings that the firm's attorneys are "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code. Porter Hedges did not agree to any variations from or alternatives to its standard or customary billing arrangements for its employment with the Debtors. None of its professionals will vary the rate charged to the Debtors based on the geographic location of the bankruptcy cases. In addition, the Debtors have reviewed and approved the firm's standard rate structure and determined that it is appropriate and is not significantly different from the rates that the firm charges for other non-bankruptcy representations or the rates of other comparably skilled professionals, according to court filings. Porter Hedges can be reached through: John F. Higgins, Esq. Porter Hedges LLP 1000 Main St., 36th Floor Tel: 713.226.6648 Fax: 713.226.6248 Email: jhiggins@porterhedges.com About American Commercial Lines American Commercial Lines Inc. -- https://www.bargeacbl.com/ -- is a provider of liquid and dry cargo barge transportation services in the United States, operating a modern fleet of approximately 3,500 barges on the Mississippi River, its tributaries and on the Gulf Intracoastal Waterway. In addition, ACL operates a series of strategically-placed harbor services facilities throughout the region, providing fleeting, shifting, cleaning and repair services to their fleet of barges and 188 towboats as well as to third-parties. With approximately 2,100 employees as of Feb. 7, 2020, and customers that include many of the country's major energy, petrochemical, industrial, and agricultural companies. ACL was founded in 1915 and is headquartered in Jeffersonville, Ind. On Feb. 7, 2020, American Commercial Lines Inc. and 10 affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-30982) to seek confirmation of a prepackaged plan that will cut debt by $1 billion. The Hon. Marvin Isgur is the case judge. The Debtors tapped Milbank LLP and Porter Hedges LLP as legal counsel; Greenhill & Co. as financial advisor; and Alvarez & Marsal North America, LLC as restructuring advisor. The Debtors' claims agent is Prime Clerk LLC. API AMERICAS: Case Buying Laminates Business for $6 Million ----------------------------------------------------------- API Americas Inc., and API (USA) Holdings Limited ask the U.S. Bankruptcy Court for the District of Delaware to authorize the private sale of their laminates manufacturing facility located in Osgood, Indiana to Case Paper Co., Inc. for $6 million cash plus the assumption of the Assumed Liabilities. API Americas owns and operates the Laminates Business. The assets primarily used in the Laminates Business are generally comprised of (a) approximately 20 acres of real property, (b) a 115,000 square foot manufacturing facility located on the real property, and (c) the equipment and inventory necessary for the operation of the Laminates Business. Specifically, the Laminates Business uses laminating lines and related equipment to produce a wide variety of laminated papers and board products for use on fine spirits, tobacco, confectionery, and beauty brands. The Laminates Assets, other than real property and the improvements thereon, are part of the collateral securing the Prepetition Secured Obligations. As a result of decreased demand, other adverse market conditions, and unforeseen expenditures, the Laminates Business revenue declined by approximately $5 million from 2017 to 2019. Given the performance and operational difficulties of the Laminates Business over the last several years, the Debtors, with the help of their affiliates and professional advisors, actively solicited offers for the Laminates Business as a going concern. The marketing process for the Laminates Business was directed by Bill DeLong, Senior Vice President of Corporate Development at Steel Partners Holdings, LP, the ultimate parent of the Debtors, with the assistance of Ernst & Young UK LLP. Ultimately, it was determined that, after taking into account the costs and expenses associated with a liquidation process, the piecemeal liquidation of the equipment included in the Laminates Assets could generate less than $500,000 in net proceeds. In addition, the liquidation value of the land and improvements included in the Laminates Assets was estimated between $1.6 million and $1.9 million (before transaction costs). Prior to the Debtors' formal marketing process or any public announcements regarding the chapter 11 cases, Case indicated its interest in purchasing the Laminates Business as a going concern and negotiated a letter of intent. As a result of several months of arms'-length and good faith negotiations with the Purchaser, the Purchaser and API Americas agreed to the terms of the purchase agreement, pursuant to which API Americas will sell, assign, transfer, convey, and deliver to the Purchaser, and the Purchaser will purchase, acquire, and accept from API Americas, any and all right, title, and interest of API Americas in, to, and under certain of the Laminates Assets as listed in the Purchase Agreement, free and clear of all Liens. After three months of marketing the Laminates Business and continuing to negotiate with potential purchasers other than the Purchaser, the Purchaser's revised offer remains the best offer received to date. The Debtors have determined that the $6 million cash consideration portion of the Purchase Price for the Purchased Assets is the highest and best available and is both quicker and more certain than either a piecemeal liquidation of the Laminates Assets or continued discussions with potential purchasers through a lengthy auction process during the chapter 11 cases. In addition, the Purchaser has sufficient cash and financing resources for the transaction and is willing to close on an expedited basis. Given the marketing process to date, the unique nature of the Laminates Business and the challenging market in which it is currently operating, the Debtors do not believe that any further marketing would lead to higher or better offers. Rather, further marketing would only serve to increase the carrying costs and other expenses incurred by the Debtors' estates all the while depressing the value further to the detriment of the Debtors' estates and creditors. The principal terms of the Purchase Agreement are: a. Seller: API Americas Inc. b. Purchaser: Case Paper Co., Inc. c. Purchase Price: $6 million cash plus the assumption of the Assumed Liabilities d. Working Capital Adjustment: At the Closing, the Purchaser will pay to API Americas the Cash Consideration, which will be adjusted by, as applicable, (i) adding the amount by which the Estimated Net Working Capital exceeds $1.75 million, if any, or (ii) subtracting the amount by which the Estimated Net Working Capital is less than $1.25 milllion if any. The Purchaser will deliver to API Americas, within 60 days after the Closing, the Working Capital Statement setting forth its calculation of Net Working Capital as of the end of business on the Closing Date. API Americas has 30 days to dispute the amount of the Closing Date Working Capital set forth in the Working Capital Statement. If, after the final determination of the Closing Date Working Capital, (i) the Closing Date Payment is greater than the Target Closing Purchase Price, then API Americas will promptly pay such excess amount to Purchaser, or (ii) if the Closing Date Payment is less than the Target Closing Purchase Price, then the Purchaser will promptly pay such adjustment amount to API Americas. e. Deposit: $600,000 f. Purchased Assets: Laminates Business g. Breakup Fee: 3% of the Cash Consideration By the Sale Motion, the Debtors ask (a) approval of a private sale of the Purchased Assets to the Purchaser for cash consideration equal to $6 million plus assumption of the Assumed Liabilities as set forth in the Purchase Agreement, free and clear of all liens, claims, interests, and encumbrances, (b) to assume and assign the Assumed Contracts, and (c) other related relief. Pursuant to the Purchase Agreement, they ask to assume the Assumed Contracts and the obligations thereunder, and to subsequently assign the Assumed Contracts and the obligations thereunder to Purchaser. Additionally, the Debtors ask a waiver of the fourteen-day stay under Bankruptcy Rule 6004(h). A copy of the Agreement is available at https://tinyurl.com/vsbwpzd from PacerMonitor.com free of charge. About API Americas Inc. and API (USA) Holdings Limited API Americas Inc. -- http://www.apigroup.com/-- is a manufacturer of foils, laminates, and holographic materials. Among other customers, API Americas provides packaging to companies in the premium drinks, confectionery, tobacco, perfume, personal care, cosmetics, and healthcare sectors. API Americas was originally founded as Dry Print in New Jersey. Re-branded in 1998, API Americas is currently headquartered in Lawrence, Kansas inside a 56,000 square foot facility with manufacturing capabilities. API Americas Inc., and holding company API (USA) Holdings Limited, filed Chapter 11 petitions (Bankr. N.D. Del. Lead Case No. 20-10239) on February 2, 2020. The petitions were signed by Douglas Woodworth, director. As of Dec. 31, 2019, API Americas Inc., has $37.3 million in total assets, $5.8 million in current liabilities and $47.3 million in long-term liabilities. API (USA) Holdings Limited holds $51.6 million in total assets and $2.9 million in total liabilities. Saul Ewing Arnstein & Lehr LLP and Eversheds Sutherland (US) LLP represent the Debtors as general bankruptcy counsel. Ernst & Young LLP is the Debtors' financial advisor. Bankruptcy Management Solutions, Inc., d/b/a Stretto serves as the Debtors' claims and noticing agent. APOLLO ENDOSURGERY: Incurs $27.4 Million Net Loss in 2019 --------------------------------------------------------- Apollo Endosurgery, Inc., filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $27.43 million on $50.71 million of revenues for the year ended Dec. 31, 2019, compared to a net loss of $45.78 million on $60.85 million of revenues for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $74.58 million in total assets, $72.46 million in total liabilities, and $2.12 million in total stockholders' equity. As of Dec. 31, 2019, cash, cash equivalents, and restricted cash was $30.9 million. KPMG LLP, in Austin, Texas, the Company's auditor since 2014, issued a "going concern" qualification in its report dated March 26, 2020 citing that the Company has suffered recurring losses from operations, cash flow deficits and debt covenant violations and has an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. The Company has experienced operating losses since inception and occasional debt covenant violations and has an accumulated deficit of $250.2 million as of Dec. 31, 2019. To date, the Company has funded its operating losses and acquisitions through equity offerings and the issuance of debt instruments. The Company said its ability to fund future operations and meet debt covenant requirements will depend upon its level of future revenue and operating cash flow and its ability to access additional funding through either equity offerings, issuances of debt instruments or both. "We expect our negative cash flows from operating activities to continue and have determined that our losses and negative cash flows from operations along with the uncertainty of the current COVID-19 pandemic raise substantial doubt about our ability to meet our debt covenant requirements for at least one year from the issuance date of these Consolidated Financial Statements. We will likely require additional funding to remain in compliance, depending upon events that are difficult to predict at this time. In this regard, management's plans to meet any additional operating cash flow requirements include the pursuit of strategic alternatives to finance our business plan, including, but not limited to sales of our common stock, preferred stock, convertible debt securities or debt financings, reduction of planned expenditures, or other sources," Apollo Endosurgery stated. "There are no assurances that such additional funding will be obtained, and we cannot predict the impact of COVID-19 on our operations and ability to access the additional funding we may need. If we cannot successfully raise additional capital and implement our strategic development plan, our liquidity, financial condition and business prospects will be materially and adversely affected," the Company added. A full-text copy of the Form 10-K is available for free at: https://is.gd/kT6RUB About Apollo Endosurgery Apollo Endosurgery, Inc. -- http://www.apolloendo.com/-- is a medical technology company focused on less invasive therapies to treat various gastrointestinal conditions, ranging from gastrointestinal complications to the treatment of obesity. Apollo's device-based therapies are an alternative to invasive surgical procedures, thus lowering complication rates and reducing total healthcare costs. Apollo's products are offered in over 75 countrie and include the OverStitch Endoscopic Suturing System, the OverStitch Sx Endoscopic Suturing System, and the ORBERA Intragastric Balloon. ARADIGM CORP: Selling Substantially All Assets to Grifols for $3.2M ------------------------------------------------------------------- Aradigm Corp. asks the U.S. Bankruptcy Court for the Northern District of California to authorize the bidding procedures in connection with sale of substantially all assets to Grifols, S.A., subject to overbid. The aggregate purchase price for the Purchased Assets will be: (i) $3,247,000, cash; (ii) Waiver of the Buyer's right to payment on account of the proof of claim for an amount of at least $19.95 million, filed on March 15, 2019, and identified as Claim No. 4 in the Bankruptcy Case; (iii) Waiver of Grifols Worldwide Operations Ltd.'s right to payment on account of the proof of claim for an amount of at least $11,785,899, filed on March 15, 2019, and identified as Claim No. 5; (iv) The Milestone Payments; and (v) The Royalties. The Debtor has limited operating income and relies on investor capital to fund its operations and its research, development and regulatory efforts. Addressing the delays, the Debtor experienced obtaining regulatory approval and the FDA's request for an additional Phase 3 trial would have required significant expenditures by the Debtor on additional research, administrative expenses, and development and regulatory activities. The Debtor lacked the capital to fund these expenditures. Grifols, the Debtor's principal funding partner, indicated that it was unwilling to fund the new Phase 3 trial requested by the FDA and was unwilling to continue to fund the Debtor. The Debtor therefore determined that it needed to seek a buyer for its assets and filed the Chapter 11 case in order to conserve its cash resources and to pursue a sale of its assets. After the Feb. 15, 2019 petition date, the Debtor engaged in significant marketing of its assets. Through those efforts, the Debtor reached an agreement with Grifols to sell substantially all of its assets free and clear of all liens, claims, and encumbrances, subject to overbid, as more particularly set forth in the asset purchase agreement. The Debtor firmly believes that selling its assets as a going concern subject to overbid will maximize value for the estate and creditors. To facilitate the sale process and the solicitation and receipt of higher and better bids, the Debtor asks approval of the bidding procedures. It also asks approval to pay Grifols a break-up fee of $500,000 in the event that Grifols is not the winning bidder at the auction. The Bidding Procedures are specifically designed to market the Assets and ensure the ultimate offer submitted by the winning bidder will provide the greatest return for the estate. As the Court is aware, the Debtor's assets are complex as a result of the License and Collaboration Agreement between the Debtor and Grifols. The Debtor looks forward to testing the market with respect to the value of its assets. The salient terms of the Bidding Procedures are: a. Bid Deadline: No later than 5:00 p.m. (PT) on the date that is five days before the Auction Date b. Initial Bid: $3,997,000 cash c. Deposit: 10% of the cash component of the proposed purchase price d. Auction: The Debtor will conduct an Auction for its assets, which will take place at the office of the Debtor's counsel, Jeffer Mangels Butler & Mitchell, LLP, located at Two Embarcadero Center, Fifth Floor, San Francisco, California, on March 24, 2020, commencing at 2:00 p.m. (PT), or such other time and date as ordered by the Court. e. Bid Increments: $100,000 f. Sale Hearing: March 25, 2020 at 10:30 a.m. (PT) The proposed Bidding Procedures and Break-Up Fee are properly designed to encourage a robust and lively Auction and ensure a sale of the Debtor's assets at the highest and best price. The Debtor therefore asks that the Court approves the Bidding Procedures and the Break-Up Fee. About Aradigm Corporation Aradigm Corporation -- http://www.aradigm.com/-- is an emerging specialty pharmaceutical company focused on the development and commercialization of products for the treatment and prevention of severe respiratory diseases. Over the last decade, the company invested a large amount of capital to develop drug delivery technologies, particularly the development of a significant amount of expertise in respiratory (pulmonary) drug delivery as incorporated in its lead product candidate that recently completed two Phase 3 clinical trials, Linhaliq inhaled ciprofloxacin, formerly known as Pulmaquin. The company is headquartered in Hayward, Calif. Aradigm Corporation sought Chapter 11 protection (Bankr. N.D. Cal. Case No. 19-40363) on Feb. 15, 2019. In the petition signed by John M. Siebert, executive chairman and interim principal executive officer, the Debtor was estimated to have $10 million to $50 million in both assets and liabilities. The case is assigned to Judge William J. Lafferty. The Debtor tapped Jeffer, Mangels, Butler & Mitchell LLP as bankruptcy counsel; Sheppard Mullin Richter & Hampton LLP as special patent counsel; and EMA Partners, LLC as investment banker. ASPEN LANDSCAPING: Wants Exclusivity Period Extended to Aug. 16 --------------------------------------------------------------- Aspen Landscaping Contracting, Inc. asked the U.S. Bankruptcy Court for the District of New Jersey to extend to Aug. 16 the period during which the company has the exclusive right to solicit votes for its Chapter 11 plan of reorganization. The company said it needs additional time to negotiate with creditors and other parties to confirm its proposed plan. About Aspen Landscaping Contracting Aspen Landscaping Contracting, Inc. -- https://www.aspennj.net/ --is a landscaping contractor located in Union, New Jersey serving commercial and residential clients. The company offers wetland mitigation, planting, hydroseeding, irrigation, railroad spraying, tree removal/pruning/clearing, erosion control/soil stabilization, soil procurement and grading, and landfill work. Aspen Landscaping Contracting sought Chapter 11 protection (Bankr. D.N.J. Case No. 19-31885) on Nov. 20, 2019 in Newark, New Jersey. In the petition was signed by Maria A. Fuentes, president, the Debtor was listed with total assets at $2,429,468 and total liabilities at $2,510,983. Judge Vincent F. Papalia oversees the case. The Debtor tapped McManimon, Scotland & Baumann, LLC as its legal counsel, and Sax, LLP as its accountant. B2B TECH: Has Until June 15 to File Plan & Disclosure Statement --------------------------------------------------------------- Judge Caryl E. Delano of the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, ordered that debtor B2B Tech USA, LLC, must file a Plan and Disclosure Statement on or before June 15, 2020. A full-text copy of the order dated March 12, 2020, is available at https://tinyurl.com/vafzml9 from PacerMonitor at no charge. About B2B Tech USA B2B Tech USA, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-01258) on Feb. 14, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $50,001 and $100,000. The Debtor tapped Buddy D. Ford, P.A., as its legal counsel. BAILEY TOOL: 5th Cir. Affirms Lower Fees for Law Firm ----------------------------------------------------- In the case captioned BAILEY TOOL & MANUFACTURING COMPANY, Debtor. HAYWARD & ASSOCIATES P.L.L.C., Appellant, v. COMERICA BANK, Appellee. HUNT HINGES, INCORPORATED Debtor. HAYWARD & ASSOCIATES P.L.L.C., Appellant, v. COMERICA BANK, Appellee. CARAFELLI METALS, INCORPORATED, Debtor. HAYWARD & ASSOCIATES P.L.L.C., Appellant, v. COMERICA BANK, Appellee. BAILEY SHELTER, L.P., Debtor. HAYWARD & ASSOCIATES P.L.L.C., Appellant, v. COMERICA BANK, Appellee, No. 19-10514 (5th Cir.), the United States Court of Appeals, Fifth Circuit upholds the district court's ruling that affirmed the bankruptcy court's award of $346,042.50 in fees and $24,594.22 in expenses to Hayward & Associates, P.L.L.C. ("H&A"). H&A provided bankruptcy-related legal services to four interrelated entities -- Bailey Tool & Manufacturing Co., Hunt Hinges, Inc., Cafarelli Metals, Inc., and Bailey Shelter, L.P. Throughout the jointly administered proceedings, H&A worked to advance all four bankruptcies. After nearly a year of joint administration under chapter 11, the bankruptcy court converted all four bankruptcy proceedings to chapter 7, dissolved joint administration, and appointed a chapter 7 trustee. At the chapter 7 trustee's request, the bankruptcy court imposed a deadline for parties-in-interest to file chapter 11 administrative-expense claims. H&A timely filed a fee application in each of the four bankruptcy proceedings. Comerica Bank -- the primary creditor of the operating debtors and the holder of an unsecured guaranty from Bailey Shelter -- filed a limited objection to the fee application. After an evidentiary hearing, the bankruptcy court awarded H&A $346,042.50 in fees and $24,594.22 in expenses. The award reflected all of H&A's requested fees and expenses except for $6,712.50 in fees incurred preparing the fee application after the bankruptcy proceedings were converted to chapter 7. Additionally, the bankruptcy court found Bailey Shelter not responsible for bankruptcy services not performed for it. Thus, the court held Bailey Shelter liable for only $41,529.99, or approximately 12%, of the awarded fees and $6,148.55, or approximately 25%, of the awarded expenses. The three operating debtors were held equally liable for the remainder of the fees and expenses. The district court affirmed the award. H&A argues that the bankruptcy court erred in three respects: (1) the court did not hold the debtors jointly and severally liable for H&A's fees and expenses; (2) the court determined certain portions of H&A's legal services were not "likely to benefit" Bailey Shelter; and (3) the court did not award H&A fees for preparing the fee application after the chapter 11 bankruptcy proceedings were converted to chapter 7 proceedings. Upon review, the 5th Circuit holds that neither the district court nor the bankruptcy court committed reversible error. The judgment is affirmed, essentially on the basis explained by the bankruptcy court in its August 30, 2017 Order. A copy of the Fifth Circuit's Order dated Feb. 27, 2020 is available at https://bit.ly/2vP4ROo from Leagle.com. Phillip Lewis Lamberson -- plamberson@winstead.com -- for Appellee. Melissa Sue Hayward , for Appellant. Annmarie Antoniette Chiarello -- achiarello@winstead.com -- for Appellee. About Bailey Tool & Manufacturing Bailey Tool & Manufacturing Company and its affiliated debtors filed for Chapter 11 protection (Bankr. N.D. Tex. Case No. 16-30503) on Feb. 1, 2016, and were represented by Melissa S. Hayward, Esq., at Franklin Hayward LLP in Dallas, Texas. The cases were assigned to Judge Barbara J. Houser. The petition was signed by John Buttles, president. The Debtors estimated both assets and liabilities in the range of $1 million to $10 million. The Debtors were in the business of metal fabrication. Debtor BTM operated a steel stamping facility and possessed fully integrated, state-of-the-art tooling production capabilities. BTM's business focused primarily on the manufacturing of stamped and fabricated metal components used in the automotive, truck, defense, munitions, industrial, and transportation industries as well as machine and tool and die building. Debtor HHI was a wholly owned subsidiary of BTM that manufactured continuous hinges in stainless steel, aluminum, steel, galvannealed steel, and galvanized steel. Debtor CMI was also a wholly owned subsidiary of BTM that provided metal slitting services, which was a shearing operation that cuts a large roll of metal into narrower rolls. On February 23, 2016, the Office of the U.S. Trustee appointed an official committee of unsecured creditors. The committee was represented by Fox Rothschild LLP. The cases were later converted to Chapter 7. BASIM ELHABASHY: Selling Boca Raton Property for $1.1 Million ------------------------------------------------------------- Basim Elhabashy asks the U.S. Bankruptcy Court for the Southern District of Florida to authorize his the sale of the real property located at 1501 SW 4th Avenue, Boca Raton, Florida, legally described as Lot 15 Block 1, in ESTOVILLE, According to the Plat thereof as Recorded in Plat Book 34 page 164 if the Public Records of Palm Beach County, Florida, to Daniel Neuman and Katherine Roule for $1,104,000. The Debtor is the owner of the Property. The 341 First Meeting was held on June 7, 2018 and there have been no objections to the Debtor's exemption of the homestead property. The Debtor entered into a listing agreement with John P. O'Grady Realty, Inc. on Aug. 26, 2019 for the period Aug. 26, 2019 through May 1, 2020. He filed a Motion to Approve Exclusive Right of Sales Listing Agreement on Sept. 10, 2019, and an Order Granting Debtor's Motion to Approve Exclusive Right of Sales Listing Agreement was entered on Oct. 15, 2019. The Debtor received an offer to purchase the property for the purchase price of $1,104,000. On the date of filing, the Debtor owed a mortgage of approximately $476,773 to City National Bank of Florida (POC 8) and a payoff has been requested contemporaneous therein. The brokers' commission is 4.5%, which is $49,680. Absent normal and traditional closing costs, the Debtor should receive an approximate net total of $577,547. The real property taxes are escrowed and should be paid in full for 2018. Further, as the property is located in Palm Beach County, the Debtor will be liable for the closing expenses, which are estimated at or less than 1.5% of the sale price, which would be $11,550. The Debtor also intends to pay these expenses from the sale. The Internal Revenue Service has recorded a Federal Tax Lien at O.R. Book 28974, Page 0650, in the Public Records of Palm Beach County in the amount of $732,076. Ibrahim Rahmani recorded a mortgage on Aug. 22, 2019 at O.R. Book 30841, Page 744, in the Public Records of Palm Beach County pursuant to a settlement approved by the Bankruptcy Court on May 31, 2019. The mortgage is solely to secure a $100,000 payment as agreed to by the Debtor and Ibrahim Rahmani and Debtor is currently making monthly payments pursuant to the agreement. The Debtor proposes to sell the property free and clear of the liens and encumbrances, with the liens to attach to the sale proceeds. The Counsel has contacted counsel for the Internal Revenue Service who has no objection to the sale requested herein, provided that 50% of the net proceeds are paid to the Internal Revenue Service to be applied towards the existing debt as set forth in the claim filed by the Internal Revenue Service. Further, the Internal Revenue Service has no objection to the use of the remaining 50% net proceeds by Debtor to potentially pay for administrative costs and fees in the Chapter 11 proceeding, as well as to purchase a new home in an effort to downsize. The Counsel has contacted counsel for Ibrahim Rahmani as well in an effort to resolve these matters and is awaiting a response. However, Ibrahim Rahamani is a wholly unsecured creditor in that his recorded mortgage is inferior to the existing Internal Revenue Service lien. The Debtor has been trying to sell the property for some time and is looking to downsize in an effort to decreases expenses and increase payments to the Internal Revenue Service. His realtor specializes in the area where his home is located and he believes that the sale price is the highest and best offer he will receive. The debtor believes that it was in the best interest of the Estate to accept the offer and conclude the sale of the unit. A copy of the Contract is available at https://tinyurl.com/vh26hd8 from PacerMoitor.com free of charge. Basim Elhabashy sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 18-15440) on May 7, 2018. Jordan L. Rappaport, Esq., serves as counsel to the Debtor. BES LLC: April 20 Plan & Disclosure Hearing Set ----------------------------------------------- On March 9, 2020, debtor BES LLC filed with the U.S. Bankruptcy Court for the Northern District of Georgia, Atlanta Division, a Disclosure Statement and Chapter 11 Plan. On March 12, 2020, Judge Paul Baisier conditionally approved the Disclosure Statement and established the following dates and deadlines: * April 13, 2020, is fixed as the last day for filing written acceptances or rejections of the Plan. * April 20, 2020, in Courtroom 1202, United States Courthouse, 75 Ted Turner Dr, SW, Atlanta, Georgia is fixed for the hearing on final approval of the conditionally approved Disclosure Statement and for confirmation of the Plan. * April 13, 2020, is fixed as the last day for filing and serving written objections to the conditionally approved Disclosure Statement and confirmation of the Plan. A full-text copy of the order dated March 12, 2020, is available at https://tinyurl.com/yx8bozp7 from PacerMonitor at no charge. The Debtor is represented by: PAUL REECE MARR, P.C. Paul Reece Marr, Esq. GA Bar # 471230 300 Galleria Parkway, N.W., Suite 960 Atlanta, Georgia 30339 Tel: (770) 984-2255 About BES LLC BES LLC, doing business as Black Electric Service, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 19-57615) on May 15, 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 Paul Baisier. Paul Reece Marr P.C. is the Debtor's legal counsel. BRIGGS & STRATTON: Cutting Salaries for Executives & Employees -------------------------------------------------------------- The Board of Directors of Briggs & Stratton Corporation approved reductions in the base salaries of each of the Company's named executive officers in response to the global COVID-19 pandemic. Effective April 1, 2020, the base salaries of the Company's named executive officers will be reduced by the following percentages: Todd J. Teske, Chairman, Pres. and CEO 40% Mark A. Schwertfeger, SVP and CFO 35% David J. Rodgers, SVP & President - Engines & Power 35% William H. Reitman, SVP & President - Support 35% Harold L. Redman, SVP & President - Turf & Consumer Products 35% The Board of Directors also approved the implementation of a wage reduction plan for other salaried employees of the Company and each non-employee director agreed to forego his or her next quarterly cash retainer fees payable for Board service. In addition, in order to ensure continuity of management oversight during the global COVID-19 pandemic, the Company will engage in a longer transition to the new organizational leadership structure previously announced to be effective as of April 1, 2020, with the changes now expected to be completed by the end of fiscal 2020. About Briggs & Stratton Briggs & Stratton Corporation (NYSE: BGG), headquartered in Milwaukee, Wisconsin, is a producer of gasoline engines for outdoor power equipment, and is a designer, manufacturer and marketer of power generation, pressure washer, lawn and garden, turf care and job site products through its Briggs & Stratton, Simplicity, Snapper, Ferris, Vanguard, Allmand, Billy Goat, Murray, Branco, and Victa brands. Briggs & Stratton products are designed, manufactured, marketed and serviced in over 100 countries on six continents. For additional information, please visit www.basco.com and www.briggsandstratton.com. Briggs & Stratton reported a net loss of $54.08 million for the year ended June 30, 2019, compared to a net loss of $11.32 million for the year ended July 1, 2018. As of Dec. 29, 2019, the Company had $1.80 billion in total assets, $557.30 million in total current liabilities, $844.04 million in total other liabilities, and $399.53 million in total shareholders' investment. * * * As reported by the TCR on Feb. 21, 2020, S&P Global Ratings lowered its issuer credit rating on U.S.-based manufacturer of small engines Briggs & Stratton Corp. (BGG) to 'CCC' from 'B-'. S&P believes the company might not be able to use its asset-based lending (ABL) revolving credit facility availability to repay the unsecured notes and maintain enough liquidity to meet the working capital needs of its highly seasonal business. BRIGHT MOUNTAIN: Two Directors Tender Resignations -------------------------------------------------- Bright Mountain Media, Inc. accepted the resignations of Richard Rogers and Todd Davenport as directors of the Company. Neither director had any disagreement with the Company when they tendered their resignations. On March 25, 2020, the Company appointed Jack Dunleavy and Greg Peters as directors of the Company to fill those vacancies. Mr. Dunleavy, age 70, is an inactive Certified Public Accountant spending his career with PricewaterhouseCoopers (PWC). During his tenure with PWC, he was chairman of the Finance Committee for the PWC Global Firm, a Board member of the PWC US Firm, Partner In-Charge of the Consulting Strategic Accounts, Thought Leader of the Finance and Accounting Practice and Partner In-Charge of the AT&T and Lucent accounts, the largest client engagements of the Firm. Mr. Dunleavy has authored five books on Financial Management and Systems Implementation. Mr. Dunleavy served on the board of directors of NDN, Inc., prior to the inversion which spun-off MediaHouse. He has served as a visiting professor at Tuck School Dartmouth and New York College of Insurance MBA program. Mr. Dunleavy holds a Master's degree in Business Administration – Accounting from Columbia University, an All But Dissertation degree in Educational Finance from Columbia University, a Bachelor's degree in English from Fordham University, and completed the Executive Program and Tuck School, Dartmouth. Mr. Dunleavy has been appointed chairperson of the Company's Audit Committee and a Member of the Company's Compensation Committee. Mr. Dunleavy has no arrangements or understanding with any other person pursuant to which he was appointed as a director and no family relationships with any director or executive officer of the Company. Mr. Peters, age 58, currently serves as the Company's president and chief operating officer. Mr. Peters is a founder, chairman and chief executive officer of NDN, Inc. Upon the acquisition of NDN in November 2019 by the Company, Mr. Peters became the president and chief operating officer of the Company. Mr. Peters has served as the president, CEO, and Board Member of Internap Network Services Corporation (NASDAQ: INAP) from 2002 to 2005 and in the 1990s, Mr. Peters was vice president of International Operations for Advanced Fibre Communications (NASDAQ: TLAB) and Adtran (NASDAQ: ADTN), where he led global expansion to over 40 countries. For nearly a decade, he held increasingly senior positions at AT&T Network Systems, the last being managing director of the Middle East and Africa, headquartered in Cairo, Egypt. Mr. Peters holds multiple issued patents focused on methods of searching, sorting and displaying video clips and sound files by relevance. Mr. Peters earned a Bachelor of Business Administration in Finance & Accounting from the University of Georgia and an MBA from Thunderbird. Mr. Peters has continued his educational efforts in executive programs at Harvard, Stanford and Columbia Universities. Mr. Peters has no family relationships with any director or executive officer of the Company. Employment Agreement with W. Kip Speyer On March 25, 2020, the Board approved a new Employment Agreement with W. Kip Speyer, the Company's chairman and chief executive officer. The Employment Agreement is to take effect on April 1, 2020. The Employment Agreement has a three year-term and will automatically renew for one-year periods unless either party notifies the other party, in writing, at least 90 days prior to the end of the Employment Period or the Renewal Period that the Agreement will not be renewed. The Company will pay Mr. Speyer an annual base salary of $325,000. Mr. Speier may also receive an annual bonus in an amount to be determined by the Company's Compensation Committee in their sole discretion. Mr. Speyer is entitled to participate in the Company benefit programs and he is entitled to reimbursement of out-of-pocket business expenses, including a monthly automobile allowance of $800. In the event that Mr. Speyer is terminated by the Company without cause, the Company will continue to pay his base salary in accordance with normal payroll practices through the end of his Employment Period, without renewal. Employment Agreement with Greg Peters On March 25, 2020, the Board approved a new Employment Agreement with Greg Peters the Company's president and chief operating officer. The Employment Agreement is to take effect on April 1, 2020. The Employment Agreement has a year-term and will automatically renew for a one-year period unless either party notifies the other party, in writing, at least 90 days prior to the end of the Employment Period or the Renewal Period that the Agreement will not be renewed. The Company will pay Mr. Peters an annual base salary of $325,000. Mr. Peters may also receive an annual bonus in an amount to be determined by the Company's Compensation Committee in their sole discretion. Mr. Peters is entitled to participate in the Company benefit programs and he is entitled to reimbursement of out-of-pocket business expenses, including reimbursement for mileage used during Company business in the automobile he owns or leases. In the event that Mr. Peters is terminated by the Company without cause, the Company will continue to pay his base salary in accordance with normal payroll practices through the end of his Employment Period, without renewal. About Bright Mountain Based in Boca Raton, Fla., Bright Mountain Media, Inc. -- http://www.brightmountainmedia.com/-- is a digital media holding company whose primary focus is connecting brands with consumers as a full advertising services platform. Bright Mountain Media's assets include an ad network, an ad exchange platform and 24 websites which are customized to provide its niche users, including active, reserve and retired military, law enforcement, first responders and other public safety employees with products, information and news that the Company believes may be of interest to them. Bright Mountain reported a net loss attributable to common shareholders of $5.33 million for the year ended Dec. 31, 2018, compared to a net loss attributable to common shareholders of $3.01 million for the year ended Dec. 31, 2017. As of Sept. 30, 2019, Bright Mountain had $28.36 million in total assets, $7.23 million in total liabilities, and $21.13 million in total shareholders' equity. EisnerAmper LLP, in Iselin, New Jersey, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 12, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, stating that the Company has experienced recurring net losses, cash outflows from operating activities, and has an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. BRONX MIRACLE: Chapter 11 Trustee Can Padlock Property ------------------------------------------------------ The Hon. Stuart M. Bernstein, the U.S. Bankruptcy Judge for the Southern District of New York, has approved the appointment of Deborah J. Piazza as Chapter 11 trustee for Bronx Miracle Gospel Tabernacle Inc. William K. Harrington, the United States Trustee for Region 2, named Piazza as Chapter 11 trustee following the January 7, 2020 hearing and January 8 Court order directing the trustee's appointment. Counsel for the United States Trustee consulted with these parties-in-interest regarding the appointment of the Chapter 11 trustee: a. The Debtor; b. Anthony M. Vasallo, Esq., as Counsel for the Debtor; and c. Michelle McMahon, as Counsel for Newell Funding LLC. * * * By letter dated March 18, 2020, counsel for the Chapter 11 trustee informed the Court that the Debtor had interfered with the Trustee's efforts to secure, market and sell the Debtor's real property, including refusing entry to the Trustee's broker and prospective purchasers, refusing the Trustee's request to turn over the keys and locking out the Trustee's counsel, broker and a locksmith. In addition, Trustee's counsel reported hearing construction work occurring inside which she had not authorized. Finally, the Debtor, a not-for-profit religious corporation, uses the Property to conduct religious services and the Trustee believes it prudent to shut down the Property in light of the coronavirus pandemic. The Court held a conference call with the parties on March 20, 2020. The Trustee's counsel recounted the background set forth in her letter and sought an immediate order authorizing the Trustee to change the locks, close the Property and obtain the assistance of the United States Marshal if needed. The Debtor's counsel sought more time but also argued that the mortgage was illegal because it was never approved by a court or the New York Attorney General. The Court authorized the parties to submit letter briefs on a short schedule. Having reviewed their submissions, Judge Bernstein concludes that the Trustee is entitled to an immediate order, to the extent one is even necessary, to change the locks and secure the premises from use or occupancy without her authorization. If the Debtor does not comply, the Trustee may submit an appropriate order granting such relief as maybe required including assistance from the United States Marshal together with a certification of non-compliance. About Bronx Miracle Gospel Tabernacle Bronx Miracle Gospel Tabernacle Word of Faith Ministries, Inc. -- http://www.bronxmiracle.org-- is a not-for-profit religious corporation in Bronx, New York. It sought bankruptcy protection (Bankr. S.D.N.Y. Case No. 19-12447) on July 28, 2019. In the petition signed by Rev. Dr. Keith Elijah Thompson, pastor, the Debtor estimated $1 million to $10 million in both assets and liabilities. Barak P. Cardenas, Esq. at Cardenas Islam & Associates, PLLC, serves as the Debtor's counsel. Deborah Piazza was appointed as the Debtor's Chapter 11 trustee. The trustee is represented by Tarter Krinsky & Drogin LLP. The Debtor previously sought bankruptcy protection (Bankr. S.D.N.Y. Case No. 17-11395) on May 22, 2017. C & F STURM: Brandon Lew to Get Full Payment in Sale Plan --------------------------------------------------------- Debtor C & F Sturm, LLC, filed the First Amended Disclosure Statement describing Chapter 11 Plan of Liquidation on March 19, 2020. Under the Plan, all allowed claims will be paid in full upon the completed sale of the Debtor's property. This is after the payment of the projected Statutory Fees, Professional Fee Claims, Capital Gains taxes and the Cost of Sale. This projected payout will pay 100% of the Unsecured Claims. As to Class 6 General Unsecured Claims, the largest claimant in this Class is Palco. Palco has yet to file a proof of claim. The Managing Member according to the Settlement is entitled to the Settlement Amount and is charged with paying all the costs associated with the Subject Property outside of the Costs of Sale. The Costs of Sale is to be divided between the Managing Member and Palco according to the percentage of the Sales Price that is allotted to the Managing Member and the Palco. According to the Settlement, if the Sales Price equals the MSP then the Managing Member would be entitled to $1,400,000 plus 50% of the Settlement Surplus which is $350,000 for a total of $1,750,000. 85% and Palco would be entitled to 15% of the total. Managing Member is to pay the liens and other costs as well as 85% of the Costs of Sale. Palco would be responsible for 15% of the Costs of Sale for a total received of $324,800. If the Sales Price is less than the MSP, then Palco is to receive $324,800. A full-text copy of the First Amended Disclosure Statement dated March 19, 2020, is available at https://tinyurl.com/tzhvota from PacerMonitor at no charge. Attorneys for Debtor: Stella Havkin David Jacob Havkin & Shrago Attorneys at Law. 5950 Canoga Avenue, Suite 400 Woodland Hills, California 90040 Telephone: (818) 999-1568 Facsimile: (818) 305-6040 E-mail: stella@havkinandshrago.com About C & F Sturm C & F Sturm LLC classifies its business as single asset real estate (as defined in 11 U.S.C. Single 101(51B)). It is the 100 percent owner of property lots 511 and 515 in Las Vegas Blvd., Las Vegas, with an appraised value of $1.5 million. C & F Sturm sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 19-21593) on Oct. 1, 2019. At the time of the filing, the Debtor disclosed $1,500,500 in assets and$126,488 in liabilities. The case is assigned to Judge Ernest M. Robles. The Debtor is represented by Stella A. Havkin, Esq., at Havkin & Shrago Attorneys at Law. CALIFORNIA PIZZA: Moody's Lowers CFR to Caa3, Outlook Negative -------------------------------------------------------------- Moody's Investors Service downgraded California Pizza Kitchen, Inc.'s Corporate Family Rating to Caa3 from Caa1 and Probability of Default Rating to Caa3-PD from Caa1-PD. Moody's also downgraded CPK's 1st lien secured bank facility to Caa2 from B3 and 2nd lien secured bank facility to Ca from Caa2. The ratings outlook is negative. "The downgrade reflects the expectation for a material deterioration in earnings, free cash flow and credit metrics that are driven by the restrictions and closures across CPK's restaurant base due to efforts to contain the spread of the coronavirus including recommendations from Federal, state and local governments" stated Bill Fahy, Moody's Senior Credit Officer. Moody's forecasts that CPK's funded debt/EBITDA (excluding any adjustment for operating leases) will increase to over 9.0x which will likely make it challenging for CPK to address its August 2021 expiration of its revolving credit facility. In response to these operating challenges and to strengthen liquidity, CPK's will focus on reducing all non-essential operating expenses and discretionary capex and refinancing near term maturities. Downgrades: Issuer: California Pizza Kitchen, Inc. (CPK) Probability of Default Rating, Downgraded to Caa3-PD from Caa1-PD Corporate Family Rating, Downgraded to Caa3 from Caa1 Senior Secured 1st Lien Bank Credit Facility, Downgraded to Caa2 (LGD3) from B3 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Downgraded to Ca (LGD5) from Caa2 (LGD5) Outlook Actions: Issuer: California Pizza Kitchen, Inc. (CPK) Outlook, Remains Negative RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The restaurant sector has been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in CPK's credit profile, including its exposure to widespread location closures have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and CPK's remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact on CPK of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. CPK Caa3 reflects its very high funded debt/EBITDA which is forecasted to exceed 9.0x (when excluding the impact of operating leases) and its weak EBIT/interest expense of well below 1.0x. CPK's credit profile is also constrained by its small scale and geographic concentration relative to comparable casual dining concepts. CPK is further constrained by the near-term refinancing risk and weak liquidity. CPK benefits from a high level of brand awareness, various strategic initiatives to enhance the customer experience and reduce costs, and success of newer format stores with average unit volumes higher than its average restaurant. Governance risk associated with private equity ownership is a negative rating factor for CPK given the aggressive financial strategies employed by private equity owners including high leverage and the heightened risk of debt financed distributions to shareholders. CPK is majority owned by affiliates of Golden Gate Capital, having been acquired in July 2011. The negative outlook reflects the uncertainty with regards to the potential length and severity of closures and the ultimate impact these closures will have on CPK's revenues, earnings and liquidity. The negative outlook also reflects CPK's near term refinancing risk. Factors that would lead to an upgrade or downgrade of the ratings: Factors that could result in an upgrade include a successful refinancing of CPK's near term maturity, an improvement in liquidity as well as a clear plan and time line for the lifting of restrictions on restaurants that result in a sustained improvement in operating performance, liquidity and credit metrics. Factors that could result in a downgrade include an inability to successfully refinance near term maturities, an increase in the likelihood of a default for any reason or a reduction in expected recovery. Ratings could also be downgraded in the event that credit metrics remained weak despite a lifting of restrictions on restaurants and a subsequent recovery in earnings and liquidity. Specifically, ratings could be downgraded in the event debt to EBITDA exceeded 6.5 times on a sustained basis. California Pizza Kitchen, Inc. is an owner, operator and franchisor with 227 casual dining restaurants in 28 states and 9 countries. The company is majority owned by affiliates of Golden Gate Capital. Annual revenue is about $600 million. CAVISTON INC: Second Amended Plan Confirmed by Judge ---------------------------------------------------- Judge Eric L. Frank of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania entered an order confirming the Second Amended Combined Plan of Reorganization and Disclosure Statement filed by debtor Caviston, Inc., dated March 12, 2020. The Debtor is authorized to accept the revised Univest Bank & Trust Co. ballot accepting the Second Amended Plan/DS and authorized to treat all other ballots cast to accept or reject the Debtor's Second Amended Plan/DS and to count same for purposes of the approval of the Second Amended Plan/DS. As reported in the Troubled Company Reporter, debtor Caviston filed an Amended Combined Plan of Reorganization and Disclosure Statement dated Jan. 23, 2020. Unsecured Creditors, owed $950,000 in aggregate liabilities, will receive a minimum of $60,000 payable pro rata in 20 quarterly installments of $2,000 per quarter or approximately 6.3% on of their Allowed Claims, commencing in first quarter following the Effective Date. Unsecured Creditors will also receive 10% of the Debtor's annual Net Income earned in excess of the Debtor's Projected Net Income over the 5-year cash flow payment plan, if any. The source of payment of all of the claims will be from business revenues generated by the Debtor and, to the extent of any cash shortfalls, through advances by the owners of the Debtor. In addition, the Debtor intends to file adversary proceedings in the Bankruptcy Court to prosecute Preference Actions, the proceeds of which will be retained by the Debtor and used to supplement Plan payments to its creditors in accordance with this Combined Plan and Disclosure Statement. A full-text copy of the Amended Combined Plan of Reorganization and Disclosure Statement dated January 23, 2020, is available at https://tinyurl.com/rck25ko from PacerMonitor at no charge. A full-text copy of Order Confirming the Plan entered March 19, 2020, is available at https://tinyurl.com/vrwp6u7 from PacerMonitor at no charge. About Caviston Inc. Caviston, Inc., is a privately held company whose principal assets are located at 109 Montgomeryville Mall, North Wales, Pennsylvania. Caviston sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Pa. Case No. 19-11782) on March 22, 2019. At the time of the filing, the Debtor was estimated to have assets of less than $500,000 and liabilities of $1 million to $10 million. The case is assigned to Judge Eric L. Frank. Smith Kane Holman, LLC, is the Debtor's legal counsel. CAYE SOUTH: Asks Court to Extend Exclusivity Period to June 16 -------------------------------------------------------------- Caye South Management Group, Inc. asked the U.S. Bankruptcy Court for the Western District of Texas to extend to June 16 the period during which only the company can file and confirm a Chapter 11 plan of reorganization. Frank Lyon, Esq., Caye South's attorney, said the company needs more time to see the effect of the COVID-19 pandemic on the operation of its bar, which was ordered closed by authorities until May 1. "It is impossible for [Caye South] to complete the formulation of its plan of reorganization until the short and long-term effects of the coronavirus are known and until a better picture of when bars will be allowed to reopen and under what circumstances comes into focus," Mr. Lyon said. About Caye South Management Group Based in Austin, Texas, Caye South Management Group, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No. 19-11265) on Sep. 20, 2019, listing under $1 million in both assets and liabilities. Judge Tony M. Davis oversees the case. The Debtor tapped the Law Offices of Frank B. Lyon as its legal counsel. CEDAR HAVEN: Exclusive Plan Filing Period Extended Through May 28 ----------------------------------------------------------------- Judge Christopher Sontchi of the U.S. Bankruptcy Court for the District of Delaware extended to May 28 the exclusive period during which Cedar Haven Acquisition, LLC can file a Chapter 11 plan. The company has the exclusive right to solicit votes on its plan until July 27. The extension was sought in order to provide the company and its advisors the opportunity to close on the sale of its assets to Allaire Health Care Services, LLC. Once the sale is concluded, the extension will give Cedar Haven ample time to negotiate, confirm and implement the terms of a Chapter 11 plan for the distribution of assets to creditors. About Cedar Haven Acquisition Cedar Haven Acquisition, LLC -- https://cedarhaven.healthcare/ -- is a licensed skilled nursing facility located in Lebanon, Pa., that offers professionally supervised nursing care and related medical and health services to persons whose needs are such that they can only be met in a nursing facility on an inpatient basis because of age, illness, disease, injury, convalescence or physical or mental infirmity. It was formed in 2014 through the sale of Cedar Haven Healthcare Center by the Lebanon County Commissioners to Cedar Haven. Cedar Haven Acquisition and its affiliates filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 19-11736) on Aug. 2, 2019. At the time of the filing, Cedar Haven Acquisition estimated assets of between $1 million and $10 million and liabilities of between $10 million and $50 million. The cases are assigned to Judge Christopher S. Sontchi. William E. Chipman Jr., Esq., at Chipman Brown Cicero & Cole, LLP, represents the Debtors. Andrew Vara, acting U.S. trustee for Region 3, appointed a committee of unsecured creditors on Aug. 20, 2019. The committee tapped Potter Anderson & Corroon LLP as its legal counsel, and Ryniker Consultants LLC as its financial advisor. CHRISTOPHER HAMILTON: 3rd Party Not Covered by Stay, 9th Cir. Says ------------------------------------------------------------------ In the appellate case captioned CHRISTOPHER JOHN HAMILTON; ELIZABETH LEIGH TESOLIN, Appellants, v. ELITE OF LOS ANGELES, INC.; SAN DIEGO TESTING SERVICES, INC., Appellees, No. 19-55441 (9th Cir.), the U.S. State Court of Appeals, Ninth Circuit, upholds the district court's order affirming a bankruptcy court's ruling that the automatic stay in Hamilton's Chapter 11 proceeding did not apply to a state-court action filed by Elite of Los Angeles, Inc. and San Diego Testing Services, Inc. against third-party Hamilton College Consulting. The automatic stay arising from 11 U.S.C. section 362(a) generally protects only the debtor, the property of the debtor, and the property of the estate. Chugach Timber Corp. v. N. Stevedoring & Handling Corp. (9th Cir. 1994)). The parties do not dispute that Hamilton is liable to Elite for a prepetition judgment that the bankruptcy court determined was nondischargeable in Chapter 11, nor that HCC entered into an indemnity agreement with Hamilton for the nondischargeable judgment. Elite argues that HCC's indemnity agreements with Hamilton make it contractually liable for the judgment. Elite did not name Hamilton as a defendant in the state-court action, but instead seeks to recover directly from HCC pursuant to a state law that authorizes creditor actions against third parties indebted to a judgment debtor. Hamilton contends that Chugach does not apply because indemnity differs from surety or guaranty, the types of non-debtor liability the 9th Circuit specifically identified in that case. He argues that because HCC's liability for the nondischargeable judgment arises, if at all, pursuant to the indemnity agreements, HCC is liable solely to Hamilton, and any payment HCC owes is property of the estate subject to the automatic stay. The Ninth Circuit is unpersuaded that the distinct nature of indemnity overcomes their holding in Chugach that the automatic stay does not apply to actions against "non-debtor parties liable on the debts of the debtor." The bankruptcy court did not err by concluding that the automatic stay did not extend to Elite's state-court action against HCC. A copy of the Court's Memorandum dated March 2, 2020 is available at https://bit.ly/38sD6bF from Leagle.com. Christopher John Hamilton and Elizabeth Leigh Tesolin filed for Chapter 11 bankruptcy protection (Bankr. S.D. Calif. Case No. 14-03142) on April 24, 2014. COCRYSTAL PHARMA: Incurs $48.2 Million Net Loss in 2019 ------------------------------------------------------- Cocrystal Pharma, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $48.17 million on $6.56 million of collaboration revenue for the year ended Dec. 31, 2019, compared to a net loss of $49.05 million on $0 of collaboration revenue for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $28.53 million in total assets, $2.82 million in total liabilities, and $25.71 million in total stockholders' equity. At Dec. 31, 2019, the Company had cash and cash equivalents of $7.4 million. During the first three months of 2020 the Company raised approximately $20.0 million, net $18.3 million after deducting placement agent fees and offering expenses. The Company believes that its current resources will be sufficient to fund its operations for the foreseeable future. This estimate is based, in part, upon the Company's currently projected expenditures for 2020 and 2021. Cocrystal said, "The Company will need to continue obtaining adequate capital to fund operating losses until it becomes profitable. The Company can give no assurances that the additional capital it is able to raise, if any, will be sufficient to meet its needs, or that any such financing will be obtainable on acceptable terms. If the Company is unable to obtain adequate capital, it could be forced to cease operations or substantially curtail its drug development activities. The Company expects to continue incurring substantial operating losses and negative cash flows from operations over the next several years during its pre-clinical and clinical development phases." For the year ended Dec. 31, 2019, net cash used in operating activities was $1,563,000, compared to net cash used in operating activities of $8,290,000 for the year ended Dec. 31, 2018. The decrease in cash used in operating activities in 2019 as compared to 2018 was attributable to the revenue flow from the Company's influenza A/B license agreement with Merck of $6,564,000. For the year ended Dec. 31, 2019, net cash used in investing activities netted to $145,000, which consisted of capital expenditures for lab equipment, software, and networking for the Company's Lab located in Bothell, Washington. For the year ended Dec. 31, 2018, the Company's net cash provided by investing activities consisted of $1,372,000 primarily from settlement of its mortgage note receivable of $1,400,000 offset by capital expenditures for lab equipment in its R&D facilities and relocation to Miami of its finance office. For the year ended Dec. 31, 2019, net cash provided by financing activities was $6,424,000, compared to net cash provided by financing activities of $8,893,000 for the year ended Dec. 31, 2019. Net cash generated by financing activities in 2019 and 2018 was the result of issuance common stock, net of finance lease payments. "Of course, the uncertainties caused by COVID-19 could impact our research activities and affect our Merck collaboration which would reduce this estimate. Regardless we have more than enough cash to meet our working capital needs for the next 12 months," Cocrystal said. A full-text copy of the Form 10-K is available for free at: https://is.gd/MsWciD About Cocrystal Pharma Headquartered in Creek Parkway Bothell, WA, Cocrystal Pharma, Inc. -- http://www.cocrystalpharma.com/-- is a clinical stage biotechnology company discovering and developing novel antiviral therapeutics that target the replication machinery of influenza viruses, hepatitis C viruses, noroviruses, and coronaviruses. CODY LEE WILSON: Camping World Buying RV for $32K ------------------------------------------------- Cody Lee Wilson and Whitney Brinkley Wilson ask the U.S. Bankruptcy Court for the Northern District of Texas to authorize the sale of their 2016 Heartland Cyclone 4100 Recreational Vehicle to Camping World of Lubbock for $32,000. The Debtors own the RV. The RV is worth approximately $32,000. Said RV is subject to a lien of Lone Star State Bank in the amount of approximately $16,626. They intend to sell the RV to the Buyer, 1701 Texas Loop 289 Frontage Road, Lubbock, Texas 79423, for $32,000. The parties have entered into their Sales Agreement. Any and all liens attached to said property will be satisfied within 10 days of the sale and before any proceeds being released to the Debtors. The Debtors exempted the equity in the RV and no objections to exemptions were filed; therefore, any excess funds available after all valid liens are paid in full will be divided evenly between the two Debtors. The Debtors believe the sale, as proposed herein, is in the best interest of all creditors of the estate and should be approved. A copy of the Agreement is available at https://tinyurl.com/r2whfzf from PacerMonitor.com free of charge. Cody Lee Wilson and Whitney Brinkley Wilson sought Chapter 11 protection (Bankr. N.D. Tex. Case No. 19-50292) on Nov. 4, 2019. The Debtors tapped Max Ralph Tarbox, Esq., at Tarbox Law, P.C. as counsel. COMMUNITY MEMORIAL: Moody's Affirms Ba2 Rating on $334MM Debt ------------------------------------------------------------- Moody's Investors Service has affirmed Community Memorial Health System's Ba2 revenue bond rating, affecting $334 million of rated debt. The outlook has been revised to stable from negative. RATINGS RATIONALE Affirmation of the Ba2 rating reflects its expectation that Community Memorial Health System will continue to benefit from a number of fundamental strengths, including strong clinical offerings, a solid market position, and an experienced management team. Furthermore, the newly completed flagship hospital tower, which was placed into service in December 2018 after a several-year delay, has been driving very significant volume increases (15% increase in fiscal 2019), and is expected to continue to support favorable utilization growth. Core operations improved materially in fiscal 2019, and are expected to further improve over the long term. Challenges include: very high leverage; reliance on the California State Provider Fee program; and material competition in the greater service area. Headroom to covenants has improved considerably, but nevertheless remains thin overall, creating low tolerance for missing operating budgets. Furthermore, liquidity has dropped year to date, and cash balances could be particularly vulnerable to disruption from COVID-19. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and financial market declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact of the crisis on CMHS, to date. CMHS stopped elective procedures on March 18th, and monthly revenues are expected to drop by approximately 20-30% absent a surge in COVID-19 cases. Its current expectation is that CMHS has the ability to absorb the effects of coronavirus at its current rating level, and that margins and liquidity levels will begin to stabilize in the second half of the year. RATING OUTLOOK The revision of the outlook to stable reflects its expectation that core operations will continue to improve over the long term, following the gains posted in fiscal 2019, and that long-term utilization measures will continue to improve. The outlook also incorporates its assumption that it will see containment of the coronavirus outbreak in the second half of calendar 2020 and that the economy will gradually recover. Under this scenario, it is expected that CMHS will be able to absorb the effects of the outbreak and that results through the second half of fiscal 2020 will show improvement after a weaker first half. Moody's is also assuming that the overall impact to the balance sheet will not be so severe as to violate the organization's 50 days cash on hand covenant (days cash on hand measured 90 days at December 31, 2019) and that investment losses will be reversed over time. If the impact of coronavirus on CMHS is more severe than currently contemplated, there could be renewed credit concern. Factors that would lead to an upgrade or downgrade of the rating: FACTORS THAT COULD LEAD TO AN UPGRADE - Sustained improvement in operating performance together will good revenue growth, and improvement of balance sheet measures FACTORS THAT COULD LEAD TO A DOWNGRADE - Higher than expected disruption to operations associated with coronavirus cases or more severe than expected downturn in the economy - Sustained deterioration of operating performance - Material increase in debt without commensurate growth in cash flow and liquidity - Sustained decrease in liquidity - Narrowing headroom to covenants LEGAL SECURITY Bonds are obligations of the Obligated Group, which consist of CMHS' two hospitals (Community Memorial Hospital and Ojai Valley Community Hospital) and constitute 97% of the system's revenue's, and all of its net assets. Bonds are secured by an interest in the Obligated Group's gross receivables, and by a deed of trust covering the majority of Community Memorial's properties, including both hospitals. Other certain properties are not covered by the deed of trust, but are subject to a negative pledge, and additional certain properties are not covered by either the deed of trust or the negative pledge. Substitution of notes is permitted under certain conditions. PROFILE CMHS is a not-for-profit health system located in Ventura County, California. The system operates two hospitals, a cancer center, and eleven community-based clinics. In fiscal 2019, the system generated over $500 million of operating revenues (inclusive of the provider fee), and generated nearly 13,400 hospital admissions. METHODOLOGY The principal methodology used in this rating was Not-For-Profit Healthcare published in December 2018. COOL HOLDINGS: Delays Filing of Form 10-K Amid COVID-19 Pandemic ---------------------------------------------------------------- Cool Holdings, Inc. said it will be relying on the Securities and Exchange Commission's Order under Section 36 of the Securities Exchange Act of 1934 Granting Exemptions From Specified Provisions of the Exchange Act and Certain Rules Thereunder dated March 4, 2020 (Release No. 34-88318) to delay the filing of its Annual Report on Form 10-K for the year ended Dec. 31, 2019 due to circumstances related to the coronavirus disease. A significant portion of the Company's business operations are conducted in U.S. domestic markets currently on "lock-down" orders or "shelter in place" recommendations, including key personnel responsible for assisting the Company in the development of its Annual Report, including financial statements. Due to the travel and work restrictions stemming from responses to the COVID-19 pandemic, the Company is unable to finalize various records, including financial, to permit the Company to file a timely and accurate Annual Report for its fiscal year ended Dec. 31, 2019, by the prescribed March 30, 2020, deadline without undue hardship and expense to the Company. Notwithstanding the foregoing, the Company expects to file the Annual Report as soon as practicable, and no later than May 14, 2020 (which is 45 days from the Annual Report's original filing deadline of March 30, 2020). In light of COVID-19, the Company will be including a Risk Factor in its Annual Report in substantially the following form: Locations across the U.S. in which the Company's business operations are conducted, have been impacted by travel and work restrictions implemented as a response to the novel coronavirus disease ("COVID-19"). The Company is currently following the recommendations of local and federal health authorities to minimize exposure risk for its various stakeholders, including employees. However, the scale and scope of this pandemic is unknown and the duration of the business disruption and related financial impact cannot be reasonably estimated at this time. While the Company is currently implementing specific business continuity plans to reduce the potential impact of COVID-19 on its business operations, there is no guarantee that such continuity plan, once in place, will be successful. The Company has already experienced material disruptions to its business and disruptions may occur for third-parties in the supply chain that the Company relies on, including customers, employees and suppliers. Such disruptions are likely to materially affect the Company's operations, including but not limited to the Company's efforts to provide investors with timely information through compliance with the SEC's ongoing filing obligations, its ability to obtain products or components for its products, provide its services, receive inventory in a timely manner, or provide inventory in its stores to meet retail demand. Currently, the Company has closed a number of its stores and has experienced material disruption to its revenues. The duration and scope of this disruption cannot currently be known and the COVID-19 epidemic may result in additional store closings and further reduction in revenues. Further, these disruptions could result in additional costs or penalties, or damage to the Company's reputation. Similarly, COVID-19 is likely to impact the Company's customers and/or suppliers as a result of a health epidemic or other outbreak occurring in other locations which would reduce their demand for Company products or their ability to deliver needed supplies for the production of Company products. The extent to which COVID-19 or any other health epidemic may impact the Company's results will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the severity of restrictions or actions deemed necessary to contain COVID-19 or treat its impact, among others. Accordingly, COVID-19 is likely to have a material adverse effect on the Company's business, results of operations, financial condition and prospects. About Cool Holdings Cool Holdings, Inc., formerly known as InfoSonics Corporation -- http://www.coolholdings.com-- is a Miami-based company currently comprised of Simply Mac and OneClick, two chains of retail stores and an authorized reseller under the Apple Premier Partner, APR (Apple Premium Reseller) and AAR MB (Apple Authorized Reseller Mono-Brand) programs and Cooltech Distribution, an authorized distributor to the OneClick stores and other resellers of Apple products and other high-profile consumer electronic brands. Cool Holdings reported a net loss of $27.27 million for the year ended Dec. 31, 2018, compared to a net loss of $7.54 million for the year ended Dec. 31, 2017. As of Sept. 30, 2019, the Company had $29.57 million in total assets, $41.07 million in total liabilities, and a total stockholders' deficit of $11.50 million. Kaufman, Rossin & Co., P.A., in Miami, Florida, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 16, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, citing that the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. CP#1109 LLC: May 12 Second Amended Plan & Disclosure Hearing Set ---------------------------------------------------------------- On March 10, 2020, at 1:30 p.m., the U.S. Bankruptcy Court for the Southern District of Florida, Palm Beach Division, conducted a hearing on the Second Motion to Continue Confirmation Hearing of Debtor CP#1109, LLC. On March 13, 2020, Judge Mindy A. Mora ordered that: * April 10, 2020, is the deadline for the Debtor to file a second amended disclosure statement and second amended plan of reorganization and applicable redlines showing the revisions from the earlier-filed versions. * May 12, 2020, at 1:30 p.m. at Flagler Waterview Building 1515 N Flagler Dr Room 801 Courtroom A, West Palm Beach, FL 33401 is the hearing on the second amended disclosure statement and second amended plan of reorganization. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/ubrwqjd from PacerMonitor at no charge. About CP#1109 LLC CP#1109, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-25821) on Dec. 20, 2018. At the time of the filing, the Debtor was estimated to have assets of less than $1 million and liabilities of less than $500,000. The case is assigned to Judge Mindy A. Mora. AM Law, LLC, is the Debtor's counsel. DALLAS TRADING: Seeks to Hire Eric A. Liepins as Legal Counsel -------------------------------------------------------------- Dallas Trading Enterprises, Inc., seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to hire Eric A. Liepins, 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 will be paid at these rates: Eric Liepins, Esq. $275 per hour Paralegals/Legal Assistants $30 to $50 per hour Liepins received a retainer of $5,000, plus the filing fee. Eric Liepins, Esq., disclosed in court filings that his firm does not represent any interest adverse to the Debtor's bankruptcy estate. The firm can be reached through: Eric A. Liepins, Esq. Eric A. Liepins, P.C. 12770 Coit Road, Suite 1100 Dallas, TX 75251 Telephone: (972) 991-5591 Telefax: (972) 991-5788 Email: eric@ealpc.com About Dallas Trading Enterprises Dallas Trading Enterprises, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Texas Case No. 20-60209) on March 23, 2020. At the time of the filing, the Debtor disclosed assets of between $100,001 and $500,000 and liabilities of the same range. Judge Ronald B. King oversees the case. The Debtor tapped Eric A. Liepins, P.C. as its legal counsel. DASEKE COMPANIES: Moody's Cuts CFR to B3, On Review for Downgrade ----------------------------------------------------------------- Moody's Investors Service downgraded the ratings of open deck truck carrier Daseke Companies, Inc., including the Corporate Family Rating to B3 from B2, the Probability of Default Rating to B3-PD from B2-PD and the senior secured rating to B3 from B2. The Speculative Grade Liquidity Rating was maintained at SGL-3. All ratings are under review for further downgrade. RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The transportation sector is one of the sectors that will be significantly affected by the shock, in part given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Daseke's credit profile, including its exposure to cyclical industrial production and construction spending in North America, have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions, which are likely to affect Daseke's credit metrics as the outbreak continues to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial credit implications of public health and safety. The action reflects the expected impact on Daseke of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. In its review, Moody's will consider (i) the company's liquidity (ii) the severity of the impact of the coronavirus outbreak on freight shipments, (iii) the ability of the company to adapt its costs and investments in a timely manner to possibly rapid changes in freight demand, and (iv) the potential to restore credit metrics when economic activity recovers following the coronavirus outbreak. The ratings of Daseke consider the company's position as a leading provider of open deck transportation and logistics services, its thin margins, moderate leverage and exposure to end-markets that are correlated with cyclical industrial production and construction spending in North America. The company's cash balance was nearly $100 million at year-end 2019 and availability under its revolving credit facility was approximately $85 million, subject to Daseke maintaining certain financial covenants. As an operator of heavy-duty trucks with diesel engines, Daseke is also exposed to the environmental risk that emission regulations will become more stringent, which could result in higher engine costs. Factors that would lead to an upgrade or downgrade of the ratings: The ratings could be downgraded if Moody's expects that liquidity deteriorates, including as a result of negative free cash flow, diminishing headroom under financial covenants, a material decrease in the company's cash balance or availability under its revolving credit facility. The ratings could also be downgraded if debt/EBITDA exceeds 6 times or if (FFO+interest)/interest decreases to less than 2 times. There will be no upward pressure on the ratings until freight shipments increase along with general economic activity in the US. Ratings could be upgraded if Daseke is able to sustain EBITA margins of at least 4% while generating consistently positive free cash flows, taking into account fleet investments funded through equipment loans. Other considerations for an upgrade of the ratings include debt/EBITDA less than 4.5 times and (FFO+interest)/interest of at least 3 times. The following rating actions were taken: Downgrades: Issuer: Daseke Companies, Inc. Corporate Family Rating, Downgraded to B3 from B2; Placed Under Review for further Downgrade Probability of Default Rating, Downgraded to B3-PD from B2-PD; Placed Under Review for further Downgrade Senior Secured Bank Credit Facility, Downgraded to B3 (LGD4) from B2 (LGD4); Placed Under Review for further Downgrade Outlook Actions: Issuer: Daseke Companies, Inc. Outlook, Changed To Rating Under Review From Negative The principal methodology used in these ratings was Surface Transportation and Logistics published in May 2019. Daseke Companies, Inc., headquartered in Addison, TX, is a leading provider of open deck transportation and logistics services and a direct subsidiary of Daseke, Inc., a company listed on NASDAQ Capital under the ticker "DSKE". Revenues in 2019 were $1.7 billion. DEAN & DELUCA: Case Summary & 30 Largest Unsecured Creditors ------------------------------------------------------------ Lead Debtor: Dean & DeLuca New York, Inc. 251 Little Falls Drive Wilmington, DE 19808 Business Description: The Company is a multi-channel retailer of premium gourmet and delicatessen food and beverage products under the Dean & DeLuca brand name. It traces its roots to the opening of the first Dean & DeLuca store in the Soho district of Manhattan, New York City by Joel Dean and Giorgio DeLuca in 1977. Debtor Dean & DeLuca, Inc. was incorporated in Delaware in 1999 and is the 100% owner, directly or indirectly, of each other Debtor. On Sept. 29, 2014, Pace Development Corporation, through its wholly owned subsidiary, Pace Food Retail Co., Ltd., acquired 100% of the shares of Dean & DeLuca, Inc. from its then shareholders. Chapter 11 Petition Date: March 31, 2020 Court: United States Bankruptcy Court Southern District of New York Seven affiliates that concurrently filed voluntary petitions seeking relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Dean & DeLuca New York, Inc. (Lead Case) 20-10916 Dean & DeLuca, Inc. 20-10917 Dean & DeLuca Brands, Inc. 20-10918 Dean & DeLuca International, LLC 20-10919 Dean & DeLuca Small Format, LLC 20-10920 Dean & DeLuca Atlanta, LLC 20-10921 Dean & DeLuca Markets, LLC 20-10922 Debtor's Counsel: William R. Baldiga, Esq. Bennett S. Silverberg, Esq. BROWN RUDNICK LLP Seven Times Square New York, NY 10036 Tel: (212) 209-4800 Fax: (212) 209-4801 Email: wbaldiga@brownrudnick.com bsilverberg@brownrudnick.com - and - Tristan G. Axelrod, Esq. BROWN RUDNICK LLP One Financial Center Boston, MA 02111 Tel: (617) 856-8200 Fax: (617) 856-8201 Email: taxelrod@brownrudnick.com Debtors' Claims & Noticing Agent: STRETTO https://cases.stretto.com/DeanDeLuca Estimated Assets: $10 million to $50 million Estimated Liabilities: $100 million to $500 million The petition was signed by Sorapoj Techakraisri, chief executive officer. A copy of Dean & Deluca's petition is available for free at PacerMonitor.com at: https://is.gd/jb87eu Consolidated List of Debtors' 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. 33 Ninth Retail Owner LLC Lessor $21,465,605 620 Eighth Ave. 32nd FL. New York, NY 10018 Attn: Seyfarth Shaw LLP, Counsel 620 Eighth Ave. 32nd FL. New York, NY 10018 Tel: (212) 218-5500 2. Slg Graybar Mesne Lease LLC Lessor $9,160,565 C/O Cyruli Shanks Hart & Zizmor LLP 420 Lexington Avenue Ste. 2320 New York, NY 10170 Attn: Marc Schneider Tel: 212.661.6800 Email: mschneider@cshzlaw.com 3. Internal Revenue Service Center Tax $2,151,220 Attn: Legal Dept. P.O. Box 7346 Philadelphia, PA 19101-7346 4. Interserv General $1,147,890 1430 Broadway, Suite 1805 Contractor New York, NY 10018 Attn: Joshua Boyle, President of Western Region Tel: 310.556.6800 Email: josh@InterservLP.com 5. OS Development NY LLC Stage $989,694 50 Bowery Street Services New York, NY 10013 Attn: David Moore, Executive Vice President 50 Bowery Street New York, NY 10013 Tel: 917.328.1215 Email: David.Moore@os-development.net 6. US. Foods Inc. Product- $869,322 C/O Chipman Brown Cicero & Cole LLP Foods 1313 N Market St. Ste. 5400 Wilmington, DE 19801 Attn: Gregory Stuhlman, Counsel 1313 N Market St. Ste. 5400 Wilmington, DE 19801 Tel: 302.295.0191 Email: stuhlman@chipmanbrown.com 7. Accenture LLP Consumer $783,469 1345 6th Avenue Brands- New York, NY 10105 Professional Attn: Kelly Lamaina, Services Managing Director 1345 6th Avenue New York, NY 10105 Tel: 732.934.3400 Email: kelly.a.lamaina@accenture.com 8. Laura Lendrum Employee $761,874 C/O Kudamn, Trachten, Aloe LLP 350 Fifth Ave. 68th Fl. New York, NY 10118 Attn: Gary Trachten, Counsel 350 Fifth Ave. 68th Fl. New York, NY 10118 Tel: 212.868.1010 Email: gtrachten@kudmanlaw.com 9. United Parcel Service Logistics $411,411 55 Glenlake Parkway NE Atlanta, GA Attn: Billy Herbert, Counsel to UPS 55 Glenlake Parkway NE Atlanta, GA 30328 Tel: (213) 892-5261 Email: WHerbert@mofo.com 10. 40 Wall Street LLC Lessor $400,000 C/O Belkin Burden Wenig & Goldman, LLP 270 Madison Ave. New York, NY 10016 Attn: Jay B. Solomon, Counsel Tel: 212.297.1859 Email: jsolomon@bbwg.com 11. The Chef's Warehouse/Dairyland Product- $299,747 240 Food Center Drive All Types Bronx, NY 10474 Attn: Courtney Denkovich, VP, Credit and Collections 240 Food Center Drive Bronx, NY 10474 Tel: 203.894.1345x10124 12. Four Seasons Produce Inc. Product- $271,580 McCarron & Diess Foods 576 Broadhollow Road Ste 105 Melville, NY 11747 Attn: Gregory Adam Brown, Counsel Tel: 631.425.8110 Email: gbrown@mccarronlaw.com 13. Lagardere Unlimited Consumer $260,000 Consulting, LLC Brands- 7777 Glades Road, Suite 100 Professional Boca Raton, FL 33434 Services Attn: Lee D. Galkin, General Counsel Americas 7777 Glades Road, Suite 100 Boca Raton, FL 33434 Tel: 561.245.4701 Email: lgalkin@lagardere-se.com 14. Ernst & Young LLP Audit $256,434 5 Times Square Services New York, NY 10036 Attn: Heath Cruikshank, Partner Assurance Services Tel: 479.254.6321 Email: heath.cruikshank@ey.com 15. Andrew Adams Inc. Product- $254,106 800 Second Ave. Ste 810 all Types New York, NY 10017 Attn: David J. Gold, Counsel Tel: 212.962.2910 Email: djgpcesq1@aol.com 16. North Rip Trading, Inc. Product- $251,497 1200 E. Bay Avenue, #2 Seafood Bronx, NY 10474 Attn: Andrew Szamborski, President Bronx, NY 10474 Tel: 914.552.1054 Email: Andrew@northriptrading.com 17. McGriff, Seibels & Williams, Inc. Insurance $251,131 3400 Overton Park Drive SE, Suite 300 Atlanta, GA 30339 Attn: Randy Brown, Senior Account Manager 3400 Overton Park Drive SE, Suite 300 Atlanta, GA 30339 Tel: 404.847.1606 Email: rbrown@mcgriff.com 18. Jamestown Premier Lessor $250,000 Malibu Village, LP One Maritime Plaza, 18th Fl San Francisco, CA 94111 Attn: Roey Rahmil, Counsel Shartsis Friese LLP Tel: 415.773.7283 Email: rrahmil@sflaw.com 19. Finch & Partners Consumer $247,311 47-48 Piccadilly Brands- Mayfair, London W1J ODT Professional United Kingdom Services Attn: Clementine Crawford, Partner Tel: 44 20 7297 0300 Email: Clementine@finchandpartners.com 20. Cushman & Wakefield, Inc. Real Estate $243,641 1290 Avenue of the Americas Broker New York, NY 10104-6178 Attn: Kenneth Goldstein, General Counsel, New York Tel: 212.841.5043 Email: kenneth.goldstein@cushwake.com 21. Ministry of Finance $229,543 Rama VI Rd. Phayathai, Phayathai, Thailand Tel: +66 2 126-5800 22. Luxe Collective Group Marketing $211,149 49 West 27th Street, FL. 6 New York, NY 10001 Attn: Walter C., Chief Executive Officer Tel: 212.627.3300 23. Cooling Guard HVAC $203,000 1465 Post Road East Ste. 100 Provider Westport, CT 06880 Attn: The Scheier Law Firm, LLC Counsel Tel: 201.568.3210 24. Hale & Hearty Product- $192,725 75 Ninth Avenue Soup New York, NY 10011 Attn: Paul Schwartz, VP, Sales & Marketing Tel: 773.899.0861 Email: pschwartz@haleandhearty 25. I Am Other Ventures, LLC Consumer $156,250 584 Broadway, Suite 610 Brands- New York, NY 10012 Professional Attn: Melissa Dishell, Services SVP Marketing Tel: 212.775.0250 Email: Melissa.Dishell@iamother.com 26. Meade Digital Enterprises Corp. Product- $147,000 800 Food Center Drive, Unit 4 Seafood Bronx, NY 10474-0020 Attn: Jeffrey Vanacore, Counsel to Meade Digital Tel: 718.842.8904 Email: JVanacore@perkinscoie.com 27. Oasis Staffing Temp $144,930 10777 Barkley St. Ste 130 Staffing Leawood, KS 66211 Attn: John M Molle, Counsel Tel: 913.515.828 28. Nahan Catalog $140,140 34 Seymour Street Printing Tonawanda, NY 14150 Attn: Rick Cownie, Senior Account Executive Tel: 800.873.5212 Email: RCownie@commercialcollection.com 29. RSJ Group Corporation/Rosanjin Product- $137,590 141 Duane Stret sushi New York, NY 10013 Attn: Yuri, Representative 141 Duane StretNew York, NY 10013 Tel: 212.346.7877 Email: yuri@rosanjintribeca.com 30. Mariage Freres International S.A. Product- $123,297 Attn: Christophe Massiot Specialty Managing Partner Tea 250 bis, rue du faubourg Saint-Honore Paris 75008 France Attn: Christophe Massiot, Managing Partner Tel: 33 (0)1 43 46 60 00 Email: export@mariagefreres DIRECTVIEW HOLDINGS: Delays Filing of 2019 Annual Report -------------------------------------------------------- Directview Holdings, Inc. was unable, without unreasonable effort or expense, to file its Annual Report on Form 10-K for the year ended Dec. 31, 2019 by the March 30, 2020 filing date applicable to smaller reporting companies due to a delay experienced by the Company in completing its financial statements and other disclosures in the Annual Report. The delay was a result of restrictions placed upon the Company's workforce by the cities in which its staff reside in order to combat COVID-19. As a result, the Company is still in the process of compiling required information to complete the Annual Report and its independent registered public accounting firm requires additional time to complete its review of the financial statements for the year ended Dec. 31, 2019 to be incorporated in the Annual Report. The Company anticipates that it will file the Annual Report no later than the fifteenth calendar day following the prescribed filing date. About Directview Holdings DirectView Holdings, Inc., (DIRV) together with its subsidiaries, provides video surveillance solutions and teleconferencing products and services to businesses and organizations. Based in Boca Raton, Florida, the company operates in two divisions, Security (Video Surveillance) and Video Conferencing. The Security division offers technologies in surveillance systems providing onsite and remote video and audio surveillance, digital video recording, and services. It also sells and installs surveillance systems; and sells maintenance agreements. The company sells its products and services in the United States and internationally through direct sales force, referrals, and its websites. The Video Conferencing division offers teleconferencing products and services that enable clients to conduct remote meetings by linking participants in geographically dispersed locations. It is involved in the sale of conferencing services based upon usage, the sale and installation of video equipment, and the sale of maintenance agreements. This division primarily provides conferencing products and services to numerous organizations ranging from law firms, banks, high tech companies and government organizations. DirectView Holdings maintains two websites at http://www.directview.com/and http://www.directviewsecurity.com Directview reported a net loss of $10.05 million for the year ended Dec. 31, 2018, compared to a net loss of $1.54 million for the year ended Dec. 31, 2017. As of Sept. 30, 2019, DirectView Holdings had $2.70 million in total assets, $33.72 million in total liabilities, and a total stockholders' deficit of $31.01 million. Assurance Dimensions, the Company's auditor since 2017, issued a "going concern" qualification in its report dated April 12, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, stating that the Company had a net loss and cash used from operations of approximately $10,058,000 and $1,854,000, respectively for the year ended of Dec. 31, 2018 and a working capital deficit of approximately $21,351,000 as of Dec. 31, 2018. These conditions raise substantial doubt about the Company's ability to continue as a going concern. DIVERSIFIED HEALTHCARE: Moody's Reviews Ba1 CFR for Downgrade ------------------------------------------------------------- Moody's Investors Service has placed Diversified Healthcare Trust's Ba1 senior unsecured and Ba1 corporate family rating under review for downgrade. At the same time, the speculative grade liquidity rating was downgraded to SGL-3 from SGL-2. The review for downgrade reflects the REIT's weak liquidity position, high leverage and pre-existing operating challenges that make it particularly vulnerable to risks stemming from the coronavirus outbreak. On Review for Possible Downgrade: Issuer: Diversified Healthcare Trust - Senior unsecured debt, Placed on Review for Downgrade, currently Ba1 - Corporate Family Rating, Placed on Review for Downgrade, currently Ba1 The following rating was downgraded: Issuer: Diversified Healthcare Trust - Speculative grade liquidity rating to SGL-3 from SGL-2 Outlook Actions: Issuer: Diversified Healthcare Trust - Outlook changed to Rating Under Review from Stable RATINGS RATIONALE DHC's Ba1 rating reflects its diversification among multiple segments of healthcare real estate, including senior housing, medical office buildings, life sciences, and, to a much lesser extent, wellness centers and skilled nursing. The REIT also maintains solid fixed charge coverage and a large unencumbered asset pool that provides financial flexibility. DHC's ratings are constrained by its high leverage and the increased business risk it assumed by transitioning Five Star's senior living portfolio to a management structure from a lease effective at the start of 2020. This portfolio has been experiencing declining NOI due to industry-wide challenges (new supply and labor pressures) as well as operator-specific missteps (under the previous leadership team) by Five Star. Moody's expects DHC to face execution risk with its plans to turn around performance, with the risks now magnified by the coronavirus outbreak. Moody's expects efforts to contain the spread of the coronavirus to reduce move-ins for an unknown period, with the potential for higher death-related move-outs among this high-risk population. Moreover, expense pressures from increased staffing and infection containment protocols are expected to further crimp profitability. The rating also considers governance risks associated with its external management structure, which Moody's believes creates potential conflicts of interest between management and investors. DHC is managed by The RMR Group (RMR), which also manages several other REITs and operating companies, including Five Star, which is a material concern with respect to DHC's governance. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The senior housing sector is expected to be significantly affected due to its communal setting and this population's vulnerability to serious medical complications arising from the coronavirus. More specifically, the weaknesses in DHC's credit profile, including its direct exposure to senior housing operations (40% of pro forma NOI) have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and it remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact on DHC of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. DHC's SGL-3 rating reflects its limited financial flexibility as it faces escalating operating risks. The REIT is in the mist of a disposition program intended to reduce leverage and provide proceeds for repayment of debt coming due this year. The REIT had $540mm in various stages of agreement as of the end of February, but Moody's expects it will be difficult to close on this volume of sales in the current market environment. As of 4Q19, DHC had $538mm drawn on its $1 billion unsecured revolver that matures in 2022 plus a one-year extension option. Upcoming maturities include $200mm bonds coming due in April 2020 and a $250mm term loan due in June and extendable until Dec 2020. Moody's expects the REIT will need alternative sources of capital to help address these maturities and leverage, which is already above its expectations at the existing rating level, is likely to increase further due to operating cash flow declines. Factors that would lead to an upgrade or downgrade of the ratings: Moody's review will focus on DHC's ability to enhance its liquidity position as it seeks to refinance upcoming debt maturities. Moody's will also assess the potential length and severity of pressures on the REIT's operating cash flows and its prospects for ultimately reducing leverage. DHC's ratings could be downgraded if the REIT were to experience liquidity challenges, including materially diminished cushion within its covenants. Net Debt/EBITDA above 6.5x on a sustained basis or material operating weakness causing fixed charge coverage to fall below 2.6x could also lead to a downgrade. An upgrade is unlikely near-term but would likely reflect Net Debt/EBITDA below 5.5x, sustained positive NOI growth from senior housing operations and fixed charge coverage above 3.25x. The principal methodology used in these ratings was REITs and Other Commercial Real Estate Firms published in September 2018. Diversified Healthcare Trust (DHC) is a real estate investment trust, or REIT, which owns senior living communities, medical office and life science buildings and wellness centers throughout the United States. DHC is managed by the operating subsidiary of The RMR Group Inc. (Nasdaq: RMR), an alternative asset management company that is headquartered in Newton, MA. DOVETAIL GALLERY: April 16 Plan & Disclosure Hearing Set -------------------------------------------------------- On March 11, 2020, debtor Dovetail Gallery Limited d/b/a Dovetail Gallery, Inc., filed with the U.S. Bankruptcy Court for the Western District of Pennsylvania a Disclosure Statement, Plan Summary and Plan. On March 13, 2020, Judge Thomas P. Agresti conditionally approved the Disclosure Statement and established the following dates and deadlines: * April 9, 2020, is the deadline to serve all Ballots accepting or rejecting the Plan. * April 9, 2020, is the deadline to file all objections to the Disclosure Statement and/or to Plan confirmation. * April 16, 2020, at 10:00 a.m. is the final hearing on the Disclosure Statement and Plan confirmation in Bankruptcy Courtroom, U.S. Courthouse, 17 South Park Row, Erie, PA 16501. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/ux9fmf3 from PacerMonitor at no charge. About Dovetail Gallery Limited Dovetail Gallery Limited, which conducts business under the names The Dovetail Gallery and Dovetail Gallery, Inc., filed a Chapter 11 petition (Bankr. W.D. Pa. Case No. 19-10134) on Feb. 14, 2019. In the petition signed by its president, Gary Cacchione, the Debtor disclosed assets of between $500,001 and $1 million and liabilities of the same range. Judge Thomas P. Agresti oversees the case. The Debtor is represented by Michael P. Kruszewski, Esq., and the Quinn Law Firm. No committee of unsecured creditors has been appointed in the Debtor's case. DURA AUTOMOTIVE: Exclusive Period Extended to April 29 ------------------------------------------------------ Judge Karen Owens of the U.S. Bankruptcy Court for the District of Delaware extended to April 29 the exclusive period for Dura Automotive Systems, LLC and its affiliates to file a Chapter 11 plan. The companies have the exclusive right to solicit votes on their plan until June 29. About Dura Automotive Systems Dura Automotive Systems, LLC, together with its affiliates, is an independent designer and manufacturer of automotive systems, including mechatronic systems, exterior systems, and lightweight structural systems, among others. It is nationally certified in the United States by the Women's Business Enterprise Council, and operates 25 facilities in 13 countries throughout North America, South America, Europe and Asia. Headquartered in Auburn Hills, Mich., the company -- https://www.duraauto.com/ -- employs approximately 7,400 individuals. Dura Automotive Systems sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn. Lead Case No. 19-06741) on Oct. 17, 2019. At the time of the filing, the Debtors had estimated assets of between $100 million and $500 million and liabilities of between $100 million and $500 million. The cases have been assigned to Judge Randal S. Mashburn. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as bankruptcy counsel; Bradley Arant Boult Cummings LLP as local counsel; Portage Point Partners, LLC as restructuring advisor; Jefferies LLC as financial advisor and Investment banker; and Prime Clerk LLC as claims agent. EDGEMERE, TX: Fitch Cuts Rating on $108MM Bonds to B+, Outlook Neg. ------------------------------------------------------------------- Fitch Ratings has downgraded to 'B+' from 'BB-' its rating on approximately $108 million of bonds issued by the Tarrant County Cultural Education Facilities Finance Corporation on behalf of Edgemere, TX. The Rating Outlook is Negative. SECURITY The bonds are secured by a pledge of obligated group revenues, a lien on the leasehold interest in Edgemere's property and a debt service reserve fund. KEY RATING DRIVERS OPERATING CHALLENGES in 2019: The downgrade to 'B+' is driven by Edgemere's unexpected and sizable operating loss in 2019. With operational challenges resulting from heightened competition, softening occupancy and a rising expense base, it is imperative that Lifespace, Edgemere's recent affiliation partner in June 2019, successfully implements strategies for operational improvement in 2020 despite budgeting for increasing losses. The Negative Outlook highlights Fitch's concern that the operational challenges might not be fully resolved in the near term and that possible economic disruptions in 2020 might hamper Edgemere's ability to improve its occupancy. CONTINUED WEAK PROFITABILITY: The 'B+' rating primarily reflect poor operating profitability, which remains well below budgeted levels and Fitch's expectation. The sustained operating pressure is primarily related to occupancy challenges after the completion of newly constructed assisted living and memory support units. Furthermore, Edgemere is budgeting for operating pressures in 2020. After weakened profitability from 2015 through 2018, the operating ratio and net operating margin (NOM) worsened and measured a respective 123.9% and negative 9.2% for 2019 based on unaudited figures. LIQUIDITY DECLINE CONTINUES: Edgemere's liquidity position is adequate for the rating, but has continued to decline annually for the past four years. At Dec. 31, 2019, Edgemere had approximately $39.9 million in unrestricted cash and investments according to Fitch's calculation. This level of liquidity equated to about 309 days cash on hand (DCOH) and 19.8% cash to debt, which are in line with Fitch's below-investment-grade (BIG) category medians, but are less than half the level from a few years ago. Edgemere's cash to debt was impacted by conversion of its long-term ground lease pursuant to the new Financial Accounting Standards Board (FASB) standard on leases. Edgemere booked the lease on its balance sheet at $86.9 million in 2019, approximately $50 million higher than Fitch used for its adjusted debt metric historically. SOFTER INDEPENDENT LIVING DEMAND: Edgemere enjoys a niche market position but has experienced variable independent living unit (ILU) occupancy. ILU occupancy averaged 91% between 2016 and 2018 but saw a decline to 85% in 2019 due to above-average unit turnover and increased competition. HIGH LONG-TERM LIABILITY PROFILE: Edgemere's debt position is high and is affected by the new accounting treatment of its long-term ground lease. Maximum annual debt service (MADS) as a percent of revenues amounted to 20.2% in 2019. Debt to net available weakened over the past few years due to increased borrowing, reduced cash flow and conversion of the ground lease. As a result, debt to net available measured negative 73.1x in 2019 compared to 13.6x in 2018. Due to Edgemere's weak operating profitability, MADS equated to negative 0.3x and per Edgemere's Master Trust Indenture a violation of the debt service coverage covenant occurred in 2019. Edgemere is required to call in a consultant, which Lifespace had already engaged for an operational study for future improvements. ASYMMETRIC RISK CONSIDERATIONS: There are no asymmetric risk considerations affecting the rating determination. RATING SENSITIVITIES The Negative Outlook reflects Fitch's expectation that Edgemere's operational challenges may weaken further in 2020, despite Lifespace's strategies, which are expected to improve results in the longer-run. Continued weak cash flow may result in lower liquidity, below the levels expected for the current 'B+' rating. Developments That May, Individually or Collectively, Lead to a Negative Rating Action or Outlook: -- Continued deterioration of liquidity as a life care entity below 250 days cash on hand. -- Addition of future debt that further impacts leverage metrics. -- Failure to execute on strategic plans. -- Fitch anticipates that margins will decrease in the coming months due to the disruption from the coronavirus outbreak, which is affecting both the temporary loss of both non-emergent cases and visits as well as elevating costs at Edgemere. Additionally, the financial market uncertainty is also expected to change the liquidity profile for Edgemere. -- Should economic conditions decline further than expected from Fitch's current expectations for economic contraction. Should a second wave of infections and longer lockdown periods across the parts of the country occur, Fitch would expect to see an even larger GDP decline in 2020 and a weaker recovery in 2021, and there would likely to be rating pressure for Edgemere. Developments That May, Individually or Collectively, Lead to a Positive Rating Action or Outlook: -- MADS coverage sustained at greater than 1.2x. -- Revenue growth coupled with net entrance fees in line with budget. -- Occupancy improvements at all levels of care trending to 90% or greater. BEST/WORST CASE RATING SCENARIO Ratings of Public Finance issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of three notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. CREDIT PROFILE Edgemere (Northwest Senior Living Corporation, dba Edgemere), located in the Preston Hollow neighborhood of Dallas, provides a complete continuum of care with 304 ILUs, 68 assisted living units (ALU), 45 memory support units and 87 skilled nursing facility beds (SNF). The property is leased through a long-term ground lease that runs through 2054. Total operating revenues were approximately $39 million in 2019 based on unaudited figures. Edgemere offers type-A life care resident agreements for its ILUs. Most of its contracts are 90% refundable. Entrance fee refunds are subject to Edgemere receiving sufficient re-sale proceeds after re-occupancy of the vacated ILU. However, Edgemere uses a specific unit system for entrance fee refunds, which provides refunds in a timely manner but places some challenges on cash flow and liquidity management. Edgemere is currently evaluating its contract offerings to best determine the needs of the market. Fitch's analysis and all figures cited in this report are based on the obligated group, which consists of Edgemere. The obligated group had historically provided loans to other communities under its previous owner, Senior Quality Lifestyles Corporation (SQLC) to fund capital projects and liquidity support agreements for new communities. The intercompany loans outstanding, including accrued interest and deferred management fees, measured approximately $7.7 million down significantly from prior years. For 2017, Edgemere was not able to produce audited financial statements for 2017 until mid-2018 since the collectability of its intercompany loans was being challenged. The intercompany loan balance issue was settled in February 2019 with the provision of a reserve of $29.3 million and the delivery of the 2017 audited financial statements. Further, the intercompany loan balance was reduced by about $3 million during September 2018 after SQLC sold land in Colorado for a planned new campus that was no longer being pursued. As a result, Edgemere is nearly fully reserved for repayment on these loans and Fitch's analysis assumes that no repayment is made. Lifespace Communities, Inc. (Lifespace) is the parent company, sole corporate member and operator of Edgemere after completing an affiliation in June 2019 with the previous parent company/sole corporate member, SQLC. Lifespace owns and operates three LPCs in Texas and twelve LPCs outside of Texas. Lifespace was ranked as the 11th largest LPC system in the 2019 LeadingAge Ziegler 200. Edgemere has noted that some of its residents and team members have tested positive for COVID-19. Edgemere has implemented an emergency response as well as working with local authorities and the Centers for Disease Control and Prevention to help control further spread. It is still too early to evaluate what impact this may have on Edgemere from a short and long-term view. The recent outbreak of coronavirus and related government containment measures worldwide has created an uncertain environment for the entire healthcare system in the near term. While Edgemere's financial performance through the most recently available data has not indicated any impairment, material changes in revenue and cost profiles will occur across the sector, and will likely worsen in the coming weeks and months as economic activity suffers and as government restrictions are maintained or expanded. Fitch's ratings are forward-looking in nature, and Fitch will monitor developments in the sector as a result of the virus outbreak as it relates to severity and duration, and incorporate revised expectations for future performance and assessment of key risks. WEAKER THAN BUDGETED PROFITABILITY After its affiliation with Lifespace, Edgemere saw its operating profitability continue to decline and as such engaged a consultant to complete an operational study. Operating profitability has been variable since 2015 and saw an improvement in 2018. In 2019, the operating ratio increased to 123.9% while NOM further decreased to negative 9.2%. Management had budgeted for improved operations in 2019; however, softer occupancy and an increase in the expense base further pressured operating results. After the conclusion of the operational study, Lifespace began to implement plans to help address Edgemere's challenges. Lifespace has placed an emphasis on marketing and restructured the sales team to address the occupancy challenges. Lifespace is in the process of reviewing various contract offerings for the market to help improve occupancy and also lowered its pricing structure for SNF as it noted that the pricing structure was not in line with the market. Lifespace has also targeted improving labor efficiencies as Edgemere had become reliant on the use of agency staffing. Furthermore, Lifespace will target savings for purchasing while also looking to grow its revenue base with a focus on medical services. Lifespace continues to assess operations at Edgemere, its most challenged campus, since the affiliation. It is too early to assess the success of the strategies that Lifespace is implementing, and while these strategies take hold, there may be additional occupancy, liquidity or cash flow pressure in 2020. SOFTENING DEMAND TRENDS Edgemere has seen its ILU occupancy decline after seeing improvement in 2017 and 2018. While Edgemere is still located in a desirable area in Dallas, ILU occupancy dipped to 85.3% in 2019 from 92.8% in 2018. After the completion of capital projects, Edgemere saw an increase in competition and filled units with current residents. Lifespace restructured the sales team at Edgemere to focus on improving ILU occupancy and it is too early to assess if the changes will improve occupancy. While Edgemere has seen some improvement early in 2020, Fitch will continue to monitor how successful the changes will be. With the increased competition in the area, Edgemere continues to educate prospective residents on its life care contracts and has seen this refocus help prospective residents become actual residents. While ALU (including memory support) has seen some improvement since the completion of the project, Edgemere remains focused on further improvement especially in memory support. Edgemere reported occupancy at 84% and 68% for ALU and memory support, respectively for 2019 (63% and 47% for 2018). Edgemere saw SNF occupancy decline to 81% in 2019 from 84% in 2018. Edgemere noted that as a result of reviewing its pricing structure, Edgemere had been priced higher than the market and as such has lowered its SNF pricing in an effort to improve occupancy. HIGH LONG-TERM LIABILITY PROFILE Edgemere's long-term ground lease is now reflected as a liability on its balance in 2019 in accordance with the new accounting change. The liability is $86.9 million in 2019, which is approximately $50.0 million higher than Fitch had previously estimated for the lease commitment using an 8x multiple to the annual lease. Edgemere's debt burden remains high with bonded MADS of approximately $8 million, equating to a respective 20.2% of 2019 revenue. Reflecting the weakened profitability and the heavy debt burden MADS coverage equaled negative 0.3x in 2019, violating its covenant requirement of 1.2x. The master trust indenture's rate covenant requires 1.2x actual annual debt service coverage. As a result of the rate covenant violation, Edgemere was required to engage a consultant. Lifespace engaged a consultant to complete an operational study to improve operations. Per Edgemere's MTI rate covenant calculation, actual annual debt service coverage equaled 0.0x (unaudited) in 2019. Failure to rebuild ILU occupancy could again pressure net entrance fee receipts and lead to another rate covenant violation for 2020. CAPITAL SPENDING Edgemere has no plans for capital spending outside of routine capital. Edgemere is planning to spend capital near 1x depreciation. REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. ESG CONSIDERATIONS ESG issues are credit neutral or have only a minimal credit impact on the entity(ies), either due to their nature or the way in which they are being managed by the entity(ies). EXELA TECHNOLOGIES: HandsOn Global Reports 50% Equity Stake ----------------------------------------------------------- In an amended Schedule 13D filed with the Securities and Exchange Commission, these entities and individuals reported beneficial ownership of shares of common stock of Exela Technologies, Inc. as of March 23, 2020: Shares Percent Beneficially of Reporting Person Owned Class ---------------- ------------ ------- HandsOn Global Management LLC 74,393,234 50.0% Par Chadha 74,393,234 50.0% HOF 2 LLC 15,637,789 10.6% HOVS LLC 17,203,473 11.8% HOV Services Ltd 17,203,473 11.8% Adesi 234 LLC 3,019,560 2.1% Surinder Rametra 4,605,137 3.2% Pidgin Associates LLC 3,308,025 2.3% SoNino LLC 3,334,946 2.3% Beigam Trust 3,071,836 2.1% Ron Cogburn 372,125 0.3% Shadow Pond LLC 1,580,911 1.1% SunRaj LLC 2,225,078 1.5% Rifles Trust 1,616,439 1.1% Andrej Jonovic 484,709 0.3% HandsOn 3, LLC 46,500 Less Than 0.01% Kanwar Chadha 372,106 0.3% Suresh Yannamani 533,892 0.4% Jim Reynolds 3,387,782 2.3% Vik Negi 1,625,658 1.1% Matt Brown 145,626 0.1% Srini Murali 120,036 0.1% Vitalie Robu 249,381 0.2% Sanjay Kulkarni 63,442 Less Than .01% Mark D Fairchild 48,323 Less Than .01% Shrikant Sortur 47,186 Less Than .01% Anubhav Verma 9,448 Less Than .01% Edward J. Stephenson 8,977 Less Than .01% Eokesh Natarajan 6,613 Less Than .01% Matt Reynolds 6,379 Less Than .01% Carlos Mallen 5,670 Less Than .01% Mark Olschanski 4,725 Less Than .01% HGM continues to believe that the Common Stock is undervalued at its current levels and is exploring means to continue to acquire increased beneficial and economic ownership of the Common Stock. A full-text copy of the regulatory filing is available for free at: https://is.gd/DotSEU About Exela Technologies Headquartered in Irving, Texas, Exela -- http://www.exelatech.com/ -- is a business process automation (BPA) company, leveraging a global footprint and proprietary technology to provide digital transformation solutions enhancing quality, productivity, and end-user experience. With decades of expertise operating mission-critical processes, Exela serves a growing roster of more than 4,000 customers throughout 50 countries, including over 60% of the Fortune 100. With foundational technologies spanning information management, workflow automation, and integrated communications, Exela's software and services include multi-industry department solution suites addressing finance and accounting, human capital management, and legal management, as well as industry-specific solutions for banking, healthcare, insurance, and public sectors. Through cloud-enabled platforms, built on a configurable stack of automation modules, and over 22,000 employees operating in 23 countries, Exela rapidly deploys integrated technology and operations as an end-to-end digital journey partner. Exela incurred net losses of $162.5 million in 2018, $204.3 million in 2017, and $48.10 million in 2016. As of Sept. 30, 2019, the Company had $1.54 billion in total assets, $1.91 billion in total liabilities, and a total stockholders' deficit of $373.31 million. On Nov. 27, 2019, Exela received a letter from the Listing Qualifications Department of the Nasdaq Stock Market notifying Exela that, for the last 30 consecutive business days, the closing bid price for Exela's common stock was below the minimum $1.00 per share requirement for continued listing on The Nasdaq Capital Market as set forth in Nasdaq Listing Rule 5550(a)(2). In accordance with Nasdaq listing rules, Exela has been provided an initial period of 180 calendar days, or until May 25, 2020, to regain compliance with the Minimum Bid Price Requirement. * * * As reported by the TCR on Nov. 29, 2019, S&P Global Ratings lowered its issuer credit rating on Irving, Texas-based Exela Technologies Inc. to 'CCC-' from 'CCC+' with negative outlook. "We could lower our ratings on Exela if the company defaults, announces a distressed exchange or restructuring, or misses its interest payment," S&P said. FARWEST PUMP: Court Slashes $6,432 from Talwar Firm's Fees ---------------------------------------------------------- In the bankruptcy case captioned In re: FARWEST PUMP COMPANY, Chapter 11, Debtor, Case No. 4:17-bk-11112-BMW (Bankr. D. Ariz.), Chief Bankruptcy Judge Brenda Moody Whinery issued an order regarding Talwar Law, PLLC's third fee application for allowance of compensation and reimbursement of expenses. Judge Whinery awards the firm $32,184 on an interim basis, together with costs in the sum of $434.09. Pre-petition, on Feb. 24, 2017, Farwest Pump Company retained Talwar to represent it in certain state court litigation under a salary arrangement. On Sept. 20, 2017, Farwest filed for relief under chapter 11 of the Bankruptcy Code. After filing its bankruptcy petition, the Debtor continued to use and pay Talwar under the Salary Arrangement. On May 23, 2018, the Court ruled that the Debtor's retention of Talwar was not proper under section 327(b) of the Bankruptcy Code, but the Court allowed Talwar to seek employment nunc pro tunc and file a fee application, if appropriate. In the Fee Application, Talwar asks the Court to approve additional fees in the amount of $35,808 for 149.2 hours for services provided between July 26, 2018 and Oct. 22, 2019, in connection with the Retained Tasks and in assisting the Debtor's bankruptcy counsel, plus costs in the amount of $434.09. The Committee objected to the Fee Application on the basis that: (1) Talwar's hourly rate was not approved by the Court; (2) the fees sought are not reasonable; (3) Talwar has not complied with the U.S. Trustee's billing guidelines; and (4) some of the services that Talwar rendered were on behalf of the Debtor's principals. Creditors Doug and Christina Dunlap joined in the Committee's Objection. In the First Supplement & Response, Talwar maintains that its hourly rate was approved by the Court, its fees are reasonable, and the work for which it is seeking to be paid was work done on behalf of the Debtor. On Jan. 6, 2020, Talwar filed the Second Supplement, with detailed time entries attached. In the Second Supplement, Talwar asserts that in compiling the detailed time entries, it discovered that it had previously omitted certain time entries. Talwar is now asking the Court to approve fees for services rendered from June 4, 2018 through Oct. 22, 2019, in the amount of $38,616, an overall increase of $2,808. In the Second Supplement, Talwar maintains that it appropriately reduced travel fees to one-way travel, is only seeking to be reimbursed for necessary work, and is entitled to the requested fees. On Jan. 14, 2020, the Dunlaps and High Desert Irrigation filed an Objection, in which they ask the Court to deny or significantly discount Talwar's requested fees on the basis that the fees are unreasonable because, among other things: (1) Talwar is seeking to recover fees for providing services related to the bankruptcy, which services Talwar has not been approved to provide; (2) Talwar is seeking unreasonable fees for time spent pursuing its fee requests; (3) Talwar has failed to establish benefit to the estate; (4) Talwar is seeking duplicative compensation for services rendered by co-counsel; (5) Talwar also represents the Debtor's principals in their individual capacities; and (6) the Second Supplement contains inaccurate statements. The Official Committee of Unsecured Creditors joined in the Dunlap Objection. Talwar supplemented the Fee Application with detailed billing statements, which largely reflect that Talwar is seeking compensation for work done on various of the Retained Tasks. Although the Dunlaps and Committee argue that this work did not benefit the estate, Talwar's employment to work on the Retained Tasks was approved by the Court, the underlying outside litigation in which Talwar is involved on behalf of the estate is ongoing, and there is no concrete controverting evidence before the Court that demonstrates that the services Talwar rendered in the context of the Retained Tasks were not reasonably likely to benefit the estate. According to the Court, in some instances Talwar billed for services outside the scope of the Retained Tasks, and in other instances impermissibly billed for work done to pursue and/or defend its prior fee applications. Further, Talwar is now seeking fees in an amount greater than those sought in the Application. Talwar asserts that these previously omitted fees were brought to its attention when it brought its original billing statements into compliance with the U.S. Trustee's guidelines after the Dec. 12 Hearing, which action was taken in defense of its Fee Application. Given that the failure of a professional to maintain contemporaneous time records affects the reliability of those records, and given that work done in defense of a fee application is not compensable, the Court will limit Talwar to its original fee request. The Court, thus, determines that the fees sought in the Fee Application, as increased in the Second Supplement, must be reduced by $6,432. Fees are therefore awarded, on an interim basis, in the amount of $32,184, together with costs in the sum of $434.09. Given that this award is an interim award, the award of such fees may be reconsidered by the Court, and the objections of all parties are preserved pending a determination of fees pursuant to a final fee application to be submitted by Talwar. A copy of the Court's Ruling dated Feb. 26, 2020 is available at https://bit.ly/38CgsOd from Leagle.com. Farwest Pump Company, Debtor, represented by KASEY C. NYE -- knye@waterfallattorneys.com -- WATERFALL ECONOMIDIS CALDWELL ET AL & ROHIT TALWAR – rohit@talwarlaw.com -- TALWAR LAW PLLC. U.S. TRUSTEE, U.S. Trustee, represented by RENEE SANDLER SHAMBLIN , OFFICE OF THE U.S. TRUSTEE. Official Committee of Unsecured Creditors, Creditor Committee, represented by JOHN C. SMITH , c/o Smith and Smith PLLC. About Farwest Pump Company Based in Tucson, Arizona, Farwest Pump Company -- http://farwestwell.com/-- is a small organization that provides well drilling services to all of the southwest United States. Farwest also offers a wide variety of related services including sonar jet, municipal water systems, electrical control systems, complete machine shop, and environmental and geothermal services. Founded in 1982, Farwest is a licensed, bonded, and insured company with locations in Tucson, Willcox and Las Cruces. It is owned and operated by Clark and Channa Vaught. The Debtor sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 17-11112) on September 20, 2017. Channa Vaught, its president, signed the petition. At the time of the filing, the Debtor disclosed $2.51 million in assets and $1.85 million in liabilities. Judge Brenda Moody Whinery presides over the case. FGI ACQUISITION: Moody's Lowers CFR to Caa2, Outlook Negative ------------------------------------------------------------- Moody's Investors Service downgraded its ratings for FGI Acquisition Corp., including the company's corporate family rating (CFR, to Caa2 from B3) and probability of default rating (to Caa3-PD from Caa1-PD), along with the ratings for its senior secured first lien bank credit facilities (to Caa2 from B3). The ratings outlook is negative. "The downgrades reflect its expectation of further earnings erosion over the course of 2020, compounding weaker than anticipated operating results in the second half of 2019 and a subsequently elevated financial risk profile," says Shirley Singh, Moody's lead analyst for Flexitallic. Flexitallic's large exposure to the pressured oil & gas sector makes it susceptible to the recent fall in prices and broader economic slowdown. Moody's expects spending levels in the company's end-markets to contract, which will exert incremental pressure on the company's earnings and in turn increase cash flow deficits in the year ahead. The rapid and widening spread of the coronavirus outbreak, the deteriorating global economic outlook, falling oil prices and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The global oil & gas sector is among the sectors that have been adversely affected by the shock. More specifically, Flexitallic's exposure to the oil & gas sector have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions, and the company remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The actions reflect the impact on Flexitallic of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. The following rating actions were taken: Downgrades: Issuer: FGI Acquisition Corp. Corporate Family Rating, Downgraded to Caa2 from B3 Probability of Default Rating, Downgraded to Caa3-PD from Caa1-PD Senior Secured Bank Credit Facility, Downgraded to Caa2 (LGD3) from B3 (LGD3) Outlook Actions: Issuer: FGI Acquisition Corp. Outlook, Changed to Negative from Stable RATINGS RATIONALE Flexitallic's Caa2 CFR broadly reflects the company's weakening financial profile in an increasingly pressured operating environment, with weak liquidity provisions constraining financial flexibility. Heightened volatility and market pressures in the oil & gas industry sector coupled with broader macroeconomic weakness will exert significant pressure on Flexitallic's operations and increase cash flow deficits in 2020. The rating also reflects the company's relatively small revenue base (roughly $174 million), a narrow end-market focus, and exposure to cyclical end markets. These credit constraints are balanced by the company's strong niche market position, its significant presence Maintenance Repair and Operations (MRO) business, its sizeable market share in semi-metallic gaskets, and its global manufacturing footprint. Regional concentration of suppliers in China is a risk, however the company has the flexibility to mobilize production out of its Thailand Facility. The negative outlook reflects the risk that demand declines in Flexitallic's end markets could accelerate, leading to a more pronounced downturn that could result in higher leverage and weaker liquidity provisions, including increased revolver reliance and negative free cash flow. Factors that would lead to an upgrade or downgrade of the ratings: The ratings could be upgraded if the oil & gas outlook or economic conditions stabilize, earnings and free cash flow turn positive, and EBITA/interest remains above 1.0x. The ratings could be downgraded if the company's revenue and earnings decline precipitously, causing further weakening in liquidity including continued negative free cash flow and increased revolver usage. The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Headquartered in Houston, Texas, Flexitallic manufacturers gaskets and other static sealing solutions for industrial applications. The company operates plants spread across the US, the UK, China and Canada and serves diverse end-markets including oil & gas, chemicals, construction and other industrial sectors. The company is owned by private equity sponsor Bridgepoint. Revenues for the fiscal year ended December 31, 2019 were approximately $174 million. GATEWAY CASINOS: S&P Cuts ICR to 'B-'; Ratings on Watch Negative ---------------------------------------------------------------- S&P Global Ratings lowered its long-term issuer credit rating on Gateway Casinos & Entertainment Ltd. to 'B-' from 'B' and placed the ratings on CreditWatch with negative implications. At the same time, S&P lowered its ratings on the company's senior secured debt to 'B+' from 'BB-' and second-lien debt to 'CCC' from 'CCC+'. The recovery ratings on both are unchanged. "Gateway entered 2020 with S&P Global Ratings-adjusted net leverage of about 8x, which, given current industry conditions, we do not expect will improve. Since the week of March 16, 2020, following the Ontario, Alberta, and B.C. governments' announced states of emergency, casinos have been closed. An emphasis on social distancing could also result in weaker traffic, even if the closures are short-lived. We estimate that revenues could decline by at least 10%-15% for 2020, which assumes a slow recovery starting later in the year, leading to adjusted leverage remaining well above 8x over the next year. The ability to contain the coronavirus, the duration of current shutdowns, and consumers' willingness to isolate, are key variables. As a result, there is significant uncertainty about the duration of the coronavirus' impact on the gaming market and Gateway's cash flow," S&P said. "Given the current challenging market conditions and weak oil prices, we have also made the assumption that Gateway will be hard pressed to sell its Edmonton properties. Therefore, we have consolidated both the lease liabilities and negative cash flow from the Edmonton properties into our EBITDA and leverage calculations. We also assume that the business combination between GTWY Holdings Ltd. (the holding company that owns a 100% equity interest in Gateway) and Leisure Acquisition Corp., a special purpose acquisition company, will be completed in the second quarter of 2020, which would lower gross debt by about C$215 million," S&P said. The CreditWatch placement reflects the potential for a downgrade over the next few months, though given the uncertainty about the duration of the outbreak, including the potential for it to recur after the summer, the rating could remain on CreditWatch until near the end of the calendar year. S&P expects to resolve the CreditWatch placement following its assessment as to whether the already weak leverage measures or liquidity, in the face of high fixed charges, are likely to deteriorate over the next year. GEMINI REALTY: Seeks to Hire Tavenner & Beran as Legal Counsel -------------------------------------------------------------- Gemini Realty, LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Virginia to hire Tavenner & Beran, PLC as its legal counsel. Tavenner will provide these services in connection with the Debtor's Chapter 11 case: (a) advise the Debtor of its rights, powers and duties in the continued operation and management of its affairs under Chapter 11; (b) prepare legal papers and review financial reports; (c) assist in the negotiation and documentation of financing agreements, debt and cash collateral orders, and related transactions; (d) review the nature and validity of any liens asserted against the Debtor's property and advise the Debtor concerning the enforceability of such liens; (e) advise the Debtor regarding its ability to initiate actions to collect and recover property for the benefit of its estate; (f) advise the Debtor in connection with the formulation, negotiation and promulgation of a plan of reorganization and related documents; (g) assist the Debtor in connection with any potential property dispositions; (h) advise the Debtor concerning the assumption, assignment, rejection, restructuring and recharacterization of executory contracts and unexpired leases; (i) assist the Debtor in reviewing, estimating and resolving claims asserted against its estate; (j) commence litigation to assert rights held by the Debtor, protect assets of the estate or further the goal of completing its reorganization; (k) provide general litigation and other non-bankruptcy services; and (l) provide other legal services related to the case. The firm will be paid at these rates: Lynn Tavenner Partner/Member $495 per hour Paula Beran Partner/Member $480 per hour David Tabakin Associate $275 per hour The Debtor provided Tavenner with a retainer totaling $7,500. Paula Beran, Esq., a partner at Tavenner, disclosed in court filings that the firm is "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code. Tavenner can be reached through: Lynn L. Tavenner, Esq. Paula S. Beran, Esq. David N. Tabakin, Esq. Tavenner & Beran, PLC 20 North 8th Street Richmond, Virginia 23219 Telephone: (804) 783-8300 Telecopier: (804) 783-0178 Email: ltavenner@tb-lawfirm.com pberan@tb-lawfirm.com dtabakin@tb-lawfirm.com About Gemini Realty Gemini Realty, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No. 20-31408) on March 12, 2020. At the time of the filing, the Debtor had estimated assets of between $500,001 and $1 million and liabilities of between $100,001 and $500,000. The Debtor tapped Tavenner & Beran, PLC as its legal counsel. GEMSTONE SOLUTIONS: April 21 Plan Confirmation Hearing Set ---------------------------------------------------------- Gemstone Solutions Group, Inc. and its debtor affiliates filed with the U.S. Bankruptcy Court for the Eastern District of Virginia, Richmond Division, a motion for entry of an order approving the adequacy of the Disclosure Statement. On March 13, 2020, the Court ordered that: * The Motion is granted. * The Disclosure Statement is approved. * The Debtors are directed to distribute (or cause to be distributed) the full Solicitation Packages, including the applicable Ballots, to: (i) all persons and entities in the Voting Classes identified in the Schedules as holding liquidated, noncontingent and undisputed claims in an amount greater than zero dollars. * Non-Voting Status Notices shall be distributed to (i) the Holders, as of the Voting Record Date, of Unimpaired Claims in Class 2 (Other Secured Claims) and Interests in Class 6 (Interests in Subsidiary Debtors), which Classes are conclusively presumed to accept the Plan and (ii) the Holders, as of the Voting Record Date, of Claims or Interests, as applicable, in Class 3a (General Unsecured Claims), Class 4 (Intercompany Claims), and Class 5 (Interests in Gemstone Solutions), which Classes are deemed to reject the Plan. * April 21, 2020, is the Confirmation Hearing. * April 13, 2020, is the deadline to file objections to confirmation of the Plan. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/w6uq8bd from PacerMonitor at no charge. The Debtors are represented by: Michael A. Condyles, Esq. Peter J. Barrett, Esq. Jeremy S. Williams, Esq. Brian H. Richardson, Esq. KUTAK ROCK LLP 901 East Byrd Street, Suite 1000 Richmond, Virginia 23219-4071 Telephone: (804) 644-1700 Facsimile: (804) 783-6192 E-mail: Michael.Condyles@KutakRock.com Peter.Barrett@KutakRock.com Jeremy.Williams@KutakRock.com Brian.Richardson@KutakRock.com - and - Dennis F. Dunne, Esq. Evan R. Fleck, Esq. Michael W. Price, Esq. MILBANK LLP 55 Hudson Yards New York, New York 10001 Telephone: (212) 530-5000 Facsimile: (212) 530-5219 E-mail: ddunne@milbank.com efleck@milbank.com mprice@milbank.com About Gemstone Solutions Group Gemstone Solutions Group, Inc., filed a Chapter 11 bankruptcy petition (Bankr. E.D. Va. Lead Case No. 19-30258) on Jan. 16, 2019, estimating under $1 million in both assets and liabilities. The Debtor tapped Milbank LLP as counsel, Kutak Rock LLP as co-counsel, and O'Hagan Meyer PLLC, as conflict counsel. GLENVIEW HEALTH: RehabCare Objects to Plan Confirmation ------------------------------------------------------- Creditor RehabCare Group East, LLC f/k/a RehabCare Group East, Inc. d/b/a RehabCare, objects to confirmation of the Plan filed by the debtor Glenview Health Care Facility, Inc., citing that: * The Debtor failed to remove discharge, release, and injunction language from Articles IX and XI of the Plan and did not otherwise address this in the Amended Disclosure Statement. The Plan also contains inconsistent provisions related to treatment of executory contracts at 6.01 and 7.04 with one provision rejecting all agreements and the other addressing undefined assumed contracts. * The financial projections underlying the Amended Disclosure Statement are inconsistent and raise significant issues. There are two sets of financial data attached to the Amended Disclosure Statement. In either event, given the financial projections, and Debtor’s assertion of profitability, unsecured creditors should receive a much better distribution than 24% over five years. * The Debtor's Plan violates the absolute priority rule, which bars equity investors from retaining their interest while creditors with higher priority are impaired. * RehabCare joins in the United States’ demand for the insertion of default language in case of Debtors’ default on Plan obligations. RehabCare will provide suggested revisions to the language proposed by the United States for insertion to further address rights of unsecured creditors. * While the Disclosure Statement lists several claims that are to be retained, it does not specify how proceeds from those claims will be included in the payment waterfall. Some of these claims are against the very insiders receiving the benefit of retained equity under the Plan. A full-text copy of RehabCare's objection to plan dated March 13, 2020, is available at https://tinyurl.com/wrv7lcs from PacerMonitor at no charge. Counsel for RehabCare Group: FULTZ MADDOX DICKENS PLC Phillip A. Martin 101 South Fifth St., 27th Floor Louisville, KY 40202 Tel: (502) 588-2000 Fax: (502) 588-2020 E-mail: pmartin@fmdlegal.com About Glenview Health Care Facility Glenview Health Care Facility, Inc., owns and operates a 60-bed health care facility that provides nursing home services in Glasgow/Barren County, Kentucky. It is the only remaining independently owned and operated nursing facility and the lowest patient to staff ratio in the county. In 2018, it received an overall rating from CMS of 4 stars compared to the KY average of 2.97 and a National average of 3.31. The facility is owned by Kay Bush and Lisa Howlett, both of whom started their health care careers after graduating from Western Kentucky University. Glenview Health Care Facility sought relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ky. Case No. 19-10795) in Bowling Green, Kentucky on Aug. 1, 2019. As of the Petition Date, the Debtor's assets are between $1 million and $10 million; and its liabilities are estimated within the same range. Judge Joan A. Lloyd oversees the Debtor's case. Mark H. Flener, Esq., is the Debtor's counsel. The U.S. Trustee for Region 8 on Aug. 30, 2019, appointed two creditors to serve on the official committee of unsecured creditors in the Chapter 11 case. The Committee retained Bingham Greenebaum Doll LLP, as counsel. GOODRICH QUALITY: Taps Keller & Almassian as Legal Counsel ---------------------------------------------------------- Goodrich Quality Theaters, Inc., received approval from the U.S. Bankruptcy Court for the Western District of Michigan to substitute Keller & Almassian, PLC for the Law Offices of Tyrone Bynum, PLLC as its legal counsel. Keller & Almassian will provide these services in connection with the Debtor's Chapter 11 case: a. advising the Debtor of its rights, powers and duties in the continued management and operation of its financial affairs and property; b. attend meetings and negotiate with representatives of creditors and other parties; c. advise the Debtor regarding the conduct of its bankruptcy case, including all of the legal and administrative requirements of operating in Chapter 11; d. advise the Debtor on matters relating to the evaluation of the assumption, rejection or assignment of unexpired leases and executory contracts; e. take all necessary actions to protect and preserve the Debtor's estate, including the prosecution of actions on its behalf, the defense of any actions commenced against the estate, negotiations concerning all litigation in which the Debtor may be involved and objections to claims filed against the estate; f. assist in formulating and prosecuting a plan of reorganization and disclosure statement and take necessary actions to obtain confirmation of its plan; g. appear before the bankruptcy court and the Office of the United States Trustee; and h. provide all other necessary legal services. The firm will be paid at these rates: A. Todd Almassian $400 per hour James Keller $400 per hour Greg Ekdahl $350 per hour Associate Attorneys $285 per hour Paralegals $125 per hour Keller & Almassian is "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: A. Todd Almassian, Esq. Greg J. Ekdahl, Esq. Nicholas S. Laue, Esq. Keller & Almassian, PLC 320 E. Fulton Street Grand Rapids, MI 49503 Telephone: (616) 364-2100 Facsimile: (616) 364-2200 Email: talmassian@kalawgr.com gekdahl@kalawgr.com nlaue@kalawgr.xom About Goodrich Quality Theaters Goodrich Quality Theaters, Inc. -- http://www.gqti.com/-- owns and operates 30 theaters with 281 screens in cities throughout Michigan, Indiana, Illinois, Florida and Missouri. Goodrich Quality Theaters sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mich. Case No. 20-00759) on Feb. 25, 2020. At the time of the filing, the Debtor had estimated assets of between $50 million and $100 million and liabilities of between $10 million and $50 million. Judge Scott W. Dales oversees the case. The Debtor tapped Keller & Almassian, PLC as legal counsel; Stout Risius Ross Advisors, LLC as investment banker and Novo Advisors as financial advisor. GOODRICH QUALITY: Taps Stout Risius as Investment Banker -------------------------------------------------------- Goodrich Quality Theaters, Inc., received approval from the U.S. Bankruptcy Court for the Western District of Michigan to hire Stout Risius Ross Advisors, LLC as investment banker. Stout Risius will provide these services in connection with the Debtor's Chapter 11 case: (1) assist the Debtor in the development, preparation and distribution of selected information, documents and other materials in an effort to create interest in and to consummate any transaction, including the preparation of an offering memorandum; (2) solicit and evaluate indications of interest and proposals regarding any transaction from current or potential equity investors, acquirers and strategic partners; (3) assist the Debtor in the development, structuring, negotiation and implementation of the transaction, including participating as a representative of the Debtor in negotiations with creditors and other parties involved in the transaction; (4) attend meetings of the Debtor's Board of Directors, creditor groups, official constituencies and other interested parties; (5) provide expert advice and testimony regarding financial matters related to the transaction, if necessary; and (6) provide other customary financial advisory and investment banking services. The firm was paid a pre-bankruptcy retainer fee of $50,000. The Debtor has agreed to reimburse the firm up to $35,000 for work-related expenses. Michael Krakovsky, managing director and head of special situations at Stout Risius, disclosed in court filings that the firm is "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code. Stout Risius can be reached through: Michael Krakovsky Stout Risius Ross Advisors, LLC 4000 Town Center, 20th Floor Southfield, MI 48075 Phone: 1-248-208-8800 About Goodrich Quality Theaters Goodrich Quality Theaters, Inc. -- http://www.gqti.com/-- owns and operates 30 theaters with 281 screens in cities throughout Michigan, Indiana, Illinois, Florida and Missouri. Goodrich Quality Theaters sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mich. Case No. 20-00759) on Feb. 25, 2020. At the time of the filing, the Debtor had estimated assets of between $50 million and $100 million and liabilities of between $10 million and $50 million. Judge Scott W. Dales oversees the case. The Debtor tapped Keller & Almassian, PLC as legal counsel; Stout Risius Ross Advisors, LLC as investment banker and Novo Advisors as financial advisor. GPS HOSPITALITY: Moody's Lowers CFR to Caa1, Outlook Negative ------------------------------------------------------------- Moody's Investors Service downgraded GPS Hospitality Holding Company LLC's Corporate Family Rating to Caa1 from B3, Probability of Default Rating to Caa1-PD from B3-PD and 1st lien senior secured bank facility to Caa1 from B3. The outlook is negative. "The downgrade reflects the expectation for a material deterioration in earnings, cash flow and credit metrics that are driven by the restrictions and closures across GPS' restaurant base due to efforts to contain the spread of the coronavirus including recommendations from Federal, state and local governments" stated Bill Fahy, Moody's Senior Credit Officer. In response to these operating challenges and to strengthen liquidity, GPS drew down the remaining amount available under its $40 million bank revolver and will focus on reducing all non-essential operating expenses and discretionary capex. "While many quick service restaurants (QSR) are still able to provide service through the drive-thru and delivery, restaurant sales will still be well below normal operating levels for the typical QSR restaurants", added Fahy. Downgrades: Issuer: GPS Hospitality Holding Company LLC Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Corporate Family Rating, Downgraded to Caa1 from B3 Senior Secured Bank Credit Facility, Downgraded to Caa1 (LGD3) from B3 (LGD3) Outlook Actions: Issuer: GPS Hospitality Holding Company LLC Outlook, Changed To Negative From Stable RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The restaurant sector has been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in GPS' credit profile, including its exposure to widespread location closures have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and GPS remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact on GPS of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. GPS' credit profile is constrained by the company's already high leverage and weak interest coverage with EBIT/interest expense well below 1.0x prior to the impact of COVID19. The company had forecasted that EBITDA growth would support its deleveraging plan. However, the impact of coronavirus will likely result in leverage remaining very high. The rating further considers the company's brand concentration with Burger King that will require a high level of capital expenditures for new unit growth and remodel initiatives. GPS is geographically concentrated, with Georgia, Louisiana and Michigan comprising over 65% of total restaurant count. Additionally, the company faces integration risks associated with improving the operations of recently acquired units. GPS benefits from its top 3 position as a franchisee in the Burger King system in terms of units, the brand's strong position among its peers, and well balanced day-part division. The negative outlook reflects the uncertainty with regards to the potential length and severity of closures and the ultimate impact these closures will have on GPS's revenues, earnings and liquidity. The outlook also takes into account the negative impact on consumers ability and willingness to spend on eating out until the crisis materially subsides. Governance risk is a key negative rating factor as Moody's expects GPS' owners to support financial strategies which include aggressive acquisitions, high leverage and potential debt financed shareholder distributions. GPS is majority owned by founder and CEO, Tom Garrett. Minority owners include two family investment offices as well as other members of the management team. The negative outlook reflects the uncertainty with regards to the potential length and severity of closures and the ultimate impact these closures will have on GPS's revenues, earnings and liquidity. The outlook also takes into account the negative impact on consumers ability and willingness to spend on eating out until the crisis materially subsides. Factors that could result in a stable outlook include a clear plan and time line for the lifting of restrictions on restaurants that result in a sustained improvement in operating performance, liquidity and credit metrics. Given the negative outlook an upgrade is unlikely at the present time. However, an upgrade would required at least an adequate liquidity profile, debt/EBITDA below 6.5x and EBIT/interest expense approaching 1.0x. Factors that could result in a downgrade include any deterioration in liquidity or any increase in the likelihood of default. Ratings could also be downgraded in the event that credit metrics and liquidity remained weak despite a lifting of restrictions on restaurants. GPS Hospitality Holding Company LLC, headquartered in Atlanta, Georgia, owns and operates 391 Burger Kings, 19 Popeyes and 75 franchised restaurants across 11 states in the United States for a total of 485 restaurants. GPS Hospitality is privately held and is majority owned by Tom Garrett, the company's founder and CEO. Annual revenues are over $580 million. GRAND SLAM: Case Summary & 8 Unsecured Creditors ------------------------------------------------ Debtor: Grand Slam, LLC 6297 S Ruddsdale Ave Boise, ID 83709 Business Description: Grand Slam, LLC is a Single Asset Real Estate (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: March 30, 2020 Court: United States Bankruptcy Court District of Idaho Case No.: 20-00310 Judge: Hon. Joseph M. Meier Debtor's Counsel: Matthew T. Christensen, Esq. ANGSTMAN JOHNSON 199 N. Capitol Blvd, Ste 200 Boise, ID 83702 Tel: 208-384-8588 E-mail: info@angstman.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Richard Augustus, manager. A copy of the petition containing, among other items, a list of the Debtor's eight unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/Fl44Ki GRANITE US: S&P Lowers ICR to 'CCC+' on Covenant Concerns --------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on Granite U.S. Holding Corp. to 'CCC+' from 'B'. At the same time, S&P lowered its issue-level rating on the company's senior secured first-lien facilities to 'CCC+' from 'B' and its issue-level rating on its unsecured debt to 'CCC' from 'B-'. "We expect demand to decline significantly in 2020, resulting in weaker earnings and cash flow generation than we originally anticipated. Demand for Granite U.S. Holdings Corp.'s products will likely decline in the near term due to COVID-19 and the volatility in the oil and gas sector. While the company has a high degree of aftermarket business, which tends to be steadier, we believe low commodity prices and the shutdown of businesses could hurt those revenues as well. We also believe the company may have to navigate through potential supply chain disruptions. We believe that these increasing risks could substantially decrease revenues in 2020. We expect adjusted leverage to be in the mid-6x range in 2019, but that it could deteriorate substantially in 2020. Under our base-case scenario, we forecast Granite will still generate some free cash flow in 2020," S&P said. The negative outlook on Granite reflects the one-in-three risk that operating performance will deteriorate further than S&P expects, resulting in very high leverage and a covenant breach within the next 12 months. "We could lower our rating on Granite if we begin to envision a specific default scenario over the next 12 months. This could occur, for instance, if the company's end markets deteriorate significantly and if it makes limited progress improving operating profits, causing leverage to be significantly above our expectations and resulting in ongoing covenant pressure," S&P said. "We could revise our outlook to stable if the risk of a sustained economic outlook recedes and Granite improves operating profits and leverage over the next 12 months such that we do not see substantial risk of a covenant violation. If the company sustains covenant headroom of at least 15% through EBITDA growth, we could revise our outlook to stable," the rating agency said. GREENHILL & CO: S&P Alters Outlook to Negative, Affirms 'BB' ICR ---------------------------------------------------------------- S&P Global Ratings said it revised its outlook on Greenhill & Co. Inc. to negative from stable. At the same time, S&P affirmed its 'BB' issuer credit rating on Greenhill. S&P also affirmed its 'BB' issue rating on Greenhill's senior secured term loan due 2024. The recovery rating remains '3', indicating S&P's expectation for a meaningful recovery (50%) in the event of a default. Greenhill's EBITDA was lower than S&P anticipated in 2019 as a result of lower-than-expected revenue ($301 million in 2019 versus $352 million in 2018) and tighter EBITDA margins. On S&P's adjusted basis, leverage (adjusted debt to EBITDA) was 2.9x as of year-end, which was very close to its downside threshold of 3x. Additionally, FFO to debt and EBITDA to interest expense deteriorated to 23.8% and 3.8x, respectively. Both of these metrics were worse than the rating agency's stated downgrade thresholds (25% and 6x, respectively). The negative outlook reflects the increased likelihood that slowing economic conditions will affect Greenhill's 2020 results to the extent that leverage is sustained above 3x, FFO to debt below 25%, and interest coverage below 6x--S&P's triggers for a downgrade. "We could lower the ratings on Greenhill over the next 12 months if we expect leverage to be sustained above 3x, FFO to debt below 25%, and interest coverage below 6x. We could also lower the rating on Greenhill if its position as a leading merger and acquisition adviser deteriorates meaningfully or if earnings volatility increases," S&P said. A revision of the outlook to stable would likely result from leverage returning closer to 2.5x and interest coverage above 6x on a sustained basis. An upgrade is unlikely over the next 12 months," the rating agency said. GROM SOCIAL: Delays Form 10-K Filing Due to COVID-19 Pandemic ------------------------------------------------------------- Grom Social Enterprises, Inc., said the current outbreak of Covid-19 has posed a significant impact on the Company's ability to file on a timely basis its Annual Report on Form 10-K for the year ended Dec. 31, 2019, which was due to be filed on March 30, 2020. Therefore, the Company has elected to rely on the conditional filing relief provided under an order issued by the U.S. Securities and Exchange Commission on March 4, 2020, providing conditional relief to public companies that are unable to timely comply with their filing obligations as a result of the outbreak of the novel coronavirus ("Covid-19"). "The preparation of the Company's Annual Report, including financial statements and completion of the auditing process, has been delayed by Government-imposed quarantines, office closings and travel restrictions, which affect both the Company's and its service provider's personnel. Specifically, the Company has significant operations in Manila, Philippines, which has been locked down by the government since March 12, 2020, due to concerns related to the spread of Covid-19. The Company's animation studio, located in Manila, Philippines, which is owned indirectly by the Company's subsidiary TDH Holdings Limited, a Hong Kong company, doing business through its subsidiary companies, Top Draw Animation Hong Kong Limited, a Hong Kong company, and Top Draw Animation, Inc., a Philippines company, accounts for approximately 90% of the Company's total revenues on a consolidated basis. However, in response to the Philippines government's call to contain Covid-19, the animation studio, which generally employs between 580 and 600 employees, has been shut down, and all of the Company's employees in the area have been required by the government to stay at home until further notice. In addition, due to travel restrictions in the Philippines, Hong Kong and the United States, the Company's accounting personnel and service providers have been unable to process certain of its accounting records and receipts required to complete the audit of the Company's financial statements. Considering the lack of time for the compilation, dissemination and review of the information required to be presented, and the importance of investors receiving materially accurate information in the Annual Report, the Company has decided to rely on the SEC Order. The Company plans to file the Annual Report no later than May 14, 2020, or within 45 days after the Original Due Date. "The current outbreak of Covid-19 could have a material and adverse effect on the Company's business operations. These could include disruptions or restrictions on then Company's ability to travel or to distribute its products, as well as temporary closures of its production facilities. Any such disruption or delay would likely impact its sales and operating results. In addition, Covid-19 has resulted in a widespread health crisis that could adversely affect the economies and financial markets of many other countries, resulting in an economic downturn that could affect demand for its products and significantly impact its operating results," the Company stated. About Grom Social Grom -- http://www.gromsocial.com-- is a social media platform and original content provider of entertainment for children between the ages of 5 and 16, providing safe and secure digital environments for kids that can be monitored by their parents or guardians. Grom Social Enterprises, Inc., has several operating subsidiaries, including Grom Social, which delivers its content through mobile and desktop environments (web portal and apps) that entertain children, let them interact with friends, access relevant news, and play proprietary games, while teaching them about being a good digital citizen. Through its subsidiary TD Holdings, Ltd., the Company owns and operates Top Draw Animation, Inc., which produces award-winning animation content for some of the largest international media companies in the world. Grom also includes Grom Educational Services, which has provided web filtering services for K-12 schools, government and private businesses. BF Borgers CPA PC, in Lakewood, Colorado, the Company's auditor since 2015, issued a "going concern" qualification in its report dated April 16, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, stating that the Company has incurred significant operating losses since inception and has a working capital deficit which raise substantial doubt about its ability to continue as a going concern. Grom Social reported a net loss of $4.87 million for the year ended Dec. 31, 2018, compared to a net loss of $6.04 million for the year ended Dec. 31, 2017. As of Sept. 30, 2019, the Company had $19.22 million in total assets, $13.32 million in total liabilities, and $5.89 million in total stockholders' equity. HB2 LLC: April 23 Plan & Disclosure Hearing Set ----------------------------------------------- On March 11, 2020, debtor HB2 LLC filed with the U.S. Bankruptcy Court for the Eastern District of Texas, Sherman Division, a Combined Plan and Disclosure Statement. On March 13, 2020, Judge Brenda T. Rhoades conditionally approved the Disclosure Statement and established the following dates and deadlines: * April 21, 2020, is fixed as the last day for filing written acceptances or rejections of the Debtor's proposed Chapter 11 plan. * April 17, 2020, is fixed as the last day for filing and serving written objections to final approval of Debtor's disclosure statement or confirmation of the Debtor's proposed Chapter 11 plan. * April 23, 2020, at 9:30 a.m. in the Plano Bankruptcy Courtroom, 660 N. Central Expressway, Third Floor, Plano, Texas 75074 is the hearing to consider final approval of the Debtor's disclosure statement and to consider the confirmation of the Debtor's proposed Chapter 11 Plan. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/w7a69wu from PacerMonitor at no charge. About HB2 LLC HB2 LLC, d/b/a Integrity Labs, d/b/a Elite Toxicology, LLC, offers medical and diagnostic laboratory services. HB2 LLC filed a Chapter 11 petition (Bankr. E.D. Tex. Case No.19-41323) on May 16, 2019 in Sherman, Texas. In the petition signed by Wade V. Rosenburg, manager, the Debtor was estimated between $1 million and $10 million in both assets and liabilities. The Honorable Brenda T. Rhoades is the case judge. QUILLING, SELANDER, LOWNDS, WINSLETT & MOSER, PC, represents the Debtor. HELIX ACQUISITION: Moody's Places B3 CFR on Review for Downgrade ---------------------------------------------------------------- Moody's Investors Service placed all of its ratings for Helix Acquisition Holdings, Inc.'s on review for downgrade, including the B3 Corporate Family Rating, the B2 rating on the senior secured first-lien bank credit facilities and the Caa2 rating on the senior secured second-lien term loan. RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The company is exposed to sectors that will be significantly affected by the shock, given their sensitivity to consumer demand and sentiment, general economic and industrial activity. More specifically, MWI's credit profile, including its already weakening organic sales growth, high leverage and exposure to cyclical North American industrial end markets, has left it vulnerable to shifts in market sentiment in these unprecedented operating conditions. MWI also remains vulnerable to the outbreak continuing to spread, including the potential negative impact of supply chain disruptions on its material input costs. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial credit implications of public health and safety. The action reflects the expected impact on MWI of the breadth and severity of the shock, the broad deterioration in credit quality it has triggered and its lingering uncertainty. In its review, Moody's will consider (i) the company's liquidity profile, (ii) evolving market conditions, including the magnitude of the impact of the coronavirus outbreak on demand, (iii) the company's ability to replace lost business from certain key customers, (iii) its ability to adapt its costs and capital expenditures to potentially rapid declines in sales volumes, and (iv) the prospects to restore credit metrics when economic activity recovers following the coronavirus outbreak. Moody's took the following actions on Helix Acquisition Holdings, Inc.: Corporate Family Rating, Placed on Review for Downgrade, currently B3 Probability of Default Rating, Placed on Review for Downgrade, currently B3-PD Senior Secured First-Lien Bank Credit Facilities, Placed on Review for Downgrade, currently B2 (LGD3) Senior Secured Second-Lien Term Loan, Placed on Review for Downgrade, currently Caa2 (LGD6) Outlook, changed to Ratings Under Review from Stable The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Factors that would lead to an upgrade or downgrade of the ratings: The ratings could be downgraded with a deterioration in the company's liquidity, including lower than expected or sustained negative free cash flow generation, or a reliance on revolver borrowings. Downward ratings pressure could also develop with deteriorating business conditions and expectations for organic revenues or margins to decline, or weakening credit metrics. This includes a lack of progress in meaningfully reducing debt-to-EBITDA to below 6.5x on a sustained basis or if EBITA-to-interest is sustained below 1.5x (all metrics Moody's adjusted). Acquisitions or shareholder returns that sustain or increase leverage would also pressure the ratings. Upward ratings pressure is unlikely until business conditions improve along with general economic and industrial activity. The ratings could be upgraded should the company grow in scale while maintaining or improving margins and apply free cash flow towards debt reduction beyond required amortization, such that Moody's expects debt-to-EBITDA to be sustained in the low 5.0x range or better and EBITA-to-interest above 2.0x. The company would also need to maintain a good liquidity profile. Helix Acquisition Holdings, Inc., through its principal holding operating subsidiary, MWI Holdings, Inc., based in Rosemont, Illinois, is a manufacturer and designer of engineered compression and other springs, fasteners, and precision components across diverse end-markets. American Securities LLC acquired the company for approximately $820 million in September 2017. Revenues were about $430 million as of the last twelve months ended December 31, 2019. IFRESH INC: Signs Purchase Agreement with Kairui Tong & Hao Huan ---------------------------------------------------------------- iFresh Inc. entered into an agreement with Kairui Tong and Hao Huang (collectively, the "Sellers") and Hubei Rongentang Wine Co., Ltd. and Hubei Rongentang Herbal Wine Co., Ltd., pursuant to which the Sellers will sell their 100% interest in Hubei Rongentang Wine Co., Ltd. and Hubei Rongentang Herbal Wine Co., Ltd. to the Company in exchange for 3,852,372 shares of the Company's common stock and 1,000 shares of the Company's Series B Convertible Preferred Stock. Upon approval of the Company's shareholders, the 1,000 shares of Series B Preferred Stock will be converted into 3,834,796 shares of the Company's common stock. The Series B Preferred will rank on parity with the Series A Convertible Preferred Stock of the Company. The closing of the acquisition as contemplated by the Acquisition Agreement is subject to customary closing terms and conditions. The Sellers and the Target Companies make certain customary representations and warranties to the Company in connection with the Acquisition Agreement. All of the issuances and conversions of the Company's common stock in the foregoing agreements were at a price per share of $1.402, representing the average of the closing sale prices of a share of the Company's common stock as reported on The Nasdaq Stock Market for the period for five consecutive trading days ending on March 19, 2020. A full-text copy of the Acquisition Agreement is available for free at: https://is.gd/dq4TAS About iFresh Inc. Headquartered in Long Island City, New York, iFresh Inc. -- http://www.ifreshmarket.com-- is an Asian American grocery supermarket chain and online grocer on the east coast of U.S. With nine retail supermarkets along the US eastern seaboard (with additional stores in Glen Cove, Miami and Connecticut opening soon), and two in-house wholesale businesses strategically located in cities with a highly concentrated Asian population, iFresh aims to satisfy the increasing demands of Asian Americans (whose purchasing power has been growing rapidly) for fresh and culturally unique produce, seafood and other groceries that are not found in mainstream supermarkets. With an in-house proprietary delivery network, online sales channel and strong relations with farms that produce Chinese specialty vegetables and fruits, iFresh is able to offer fresh, high-quality specialty produce at competitive prices to a growing base of customers. iFresh reported a net loss of $12 million for the year ended March 31, 2019, compared to a net loss of $791,293 for the year ended March 31, 2018. As of Dec. 31, 2019, the Company had $103.37 million in total assets, $104.38 million in total liabilities, and a total shareholders' deficiency of $1 million. Friedman LLP, in New York, the Company's auditor since 2016, issued a "going concern" qualification in its report dated June 28, 2019, citing that the Company incurred operating losses and did not meet the financial covenant required in its credit agreement. These conditions raise substantial doubt about the Company's ability to continue as a going concern. IMPERIAL 290: Navika Buying Houston Property for $7.4M ------------------------------------------------------ Imperial 290 Hospitality Group, LLC, asks the U.S. Bankruptcy Court for the Southern District of Texas to authorize the short sale of the real property located at 20350 Northwest Freeway, Houston, Texas and an adjacent 0.92 acres to Navika Capital Group Phase II, LLC for $7.4 million. The Debtor owns the Property. It has actively sought offers since approximately February 2019 and has had several good offers. The Debtor has tried to find a buyer who would payoff Vantage Bank in full but has been unable to locate such a buyer. On Jan. 29, 2020, the Court approved the Commercial Earnest Money Contract (Real Estate Purchase Agreement with Evolution Hospitality Group. No order has been entered yet on the Evolution Contract. On Jan. 6, 2020, Marcus & Millichap Real Estate Investment Services of Texas, Inc. represented to the Debtor that the Evolution Contract did not include the adjacent 0.92 acres. Later on, Marcus & Millichap told Evolution that it did. This has spurred confusion as to what is to be included in the Evolution Contract. The Debtor complains that by including the adjacent 0.92 acres, at the purchase price of the Evolution Contract, substantial value is being lost. It understands that Vantage Bank wants the entire property sold not just the hotel tract. On Feb. 20, 2020, the Debtor executed a second Agreement of Sale and Purchase with Navika for $7.4 million, which is $400,000 more than the Evolution Contract. Moreover, the Navika Contract does not contain any broker fees. This results in an increase to net sale proceeds of an additional $210,000 over the Evolution Contract or total $610,000 to Vantage Bank. Navika is willing to close no later than April 6, 2020 and the Debtor believes the Navika Contract will close timely. The Debtor brings the Motion to sell the Property to Navika for $7.4 million to be paid in cash at closing without any third-party financing conditions. The sale will be free and clear of all liens, claims and encumbrances, and such liens, claims and encumbrances will attach to the sales proceeds. The sales proceeds will be held by the title company pending an order of distribution approved by the Court. It is a short sale. Vantage Bank has indicated it is willing to accept less than the amount owed on its loan but has not approved the new contract. Vantage Bank Texas, successor in interest by purchase and merger of Inter National Bank, claims a lien on the Property in excess of $8.5 million. The Property is also encumbered with liens to the taxing authorities for current years ad valorem taxes (2020). The reasonable and necessary closing costs associated with the sale will be paid at the time of closing. The Debtor asks that the 14-day period following the entry of an Order allowing the sale be waived. The Contract does include a provision requiring Navika's deposit in trust of earnest money in the amount of $150,000 which will be non-refundable upon the end of the Due Diligence Period established in Section 1.9. The Property may be subject to security interest and liens. The Debtor asks that the Property be sold free and clear of all liens claims and encumbrances. Vantage Bank Texas has a lien on the Property along with ad valorem taxing authorities. The secured lien claims will attach to the proceeds of sale. Objections, if any, must be filed within 21 days from the date of service. A copy of the Agreement is available at https://tinyurl.com/r2mzwl4 from PacerMonitor.com free of charge. About Imperial 290 Hospitality Group Imperial 290 Hospitality Group, LLC, is a privately held company that operates in the traveler accommodation industry. Imperial 290 Hospitality Group, based in Houston, TX, filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 19-31500) on March 19, 2019. In the petition signed by Shivinder Madan, manager, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. David R. Jones oversees the case. Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC, serves as the Debtor's bankruptcy counsel. ISLAND VIEW: Trustee Selling Residential Units in Phase 1 --------------------------------------------------------- Kevin O'Halloran, the Chapter 11 trustee for Island View Crossing II, LP, asks the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to (i) authorize the sale of residential unit in Phase 1 as described on Exhibit C; (ii) authorize the procedures for the approval of future sales of residential units in Phase 1 free and clear of all liens, claims and interests; and (iii) limiting notice of future sales of residential units. The Debtor's bankruptcy estate owns a residential subdivision containing approximately 17.51 acres located at 1600 Radcliffe Street, Bristol Borough, Bucks County, Pennsylvania (Tax Parcel No. 4-27-119), which was approved for development in two phases. Phase 1 is currently approved for 14 buildings containing a total of 73 townhouses and certain site improvements, and Phase 2 is currently approved for six buildings containing a total of 96 condominiums units and certain site improvements, as may be amended. Phase 1 is known as "The Townhomes at Radcliffe Court on the Delaware," a planned community. The status of the vertical construction in Phase 1 of the Project is as follows: a. The Trustee retained McGrath & Son Development, LLC as his construction manager for Phase 1. b. Five buildings (Nos. 2, 3, 4, 8 and 10) have been constructed in Phase 1 containing a total of 26 Residential Units at different stages of completion. Twelve of the twenty-six Residential Units are 100% complete and available for sale. c. Two buildings (Nos. 2 & 4) are 100% complete. i. Building 2 has 5 Residential Units (nos. 7 to 11). Residential Units Nos. 10 and 11 are fully furnished model homes; and ii. Building 4 has 7 Residential Units (nos. 41 to 47). d. Vertical construction has also begun for three additional buildings (building nos. 3, 8 and 10). i. Building 3 contains 4 Residential Units (nos. 12 to 15). This building is framed, and the roof and exterior are installed. The rough mechanicals are also completed. The next task at this building is framing and mechanical inspections. ii. Building 8 contains 6 Residential Units (nos. 16 to 21). This building is framed, and the roof and exterior are installed. The next task at this building will be the interior framing and rough mechanicals. iii. Building 10 contains 4 Residential Units (nos. 37 to 40). This building is framed, and the roof and exterior are installed. The rough mechanicals are completed and have been inspected and the building is insulated. Final plumbing, electric, HVAC need to be installed. The Pennsylvania Department of Environmental Protection ("DEP") approved the final Act 2 Report for Phase 1 on Oct. 9, 2019 and issued the environmental covenant ("EC") for Phase 1 on Dec. 16, 2019. The EC was recorded against Phase 1 with the Recorder of Deeds for Bucks County on Dec. 17, 2019. The Trustee has finalized the Public Offering Statement for the Residential Units in Phase 1 ("POS"). A copy of the POS is provided to each prospective buyer of a Residential Unit in Phase 1. While he was improving Phase 1 and seeking the DEP approval, the Trustee was also marketing the Residential Units in Phase 1 for sale. During that process the Trustee accepted reservations and token deposits of $100 from prospective buyers. On Jan. 30, 2020, the Court entered appointed the Trustee's Broker, Ralph DiGuiseppe, III of Long and Foster Real Estate. Except for the excluded prospects listed on Schedule 1 to the Broker's Agreement, the fee structure of the Trustee's Broker is as follows: a. If the Trustee's Broker acts as exclusive broker for both the Trustee and the buyer of a Residential Unit, the Trustee's Broker will earn a 2.25% brokerage commission in connection with the sale of a Residential Unit based on the purchase price of the Residential Unit. b. If a third-party broker represents the buyer of a Residential Unit, the third party broker will earn a 0.75% cooperating brokerage commission based on the Purchase Price and the Trustee's Broker will earn a 2.25% brokerage commission based on the Purchase Price. c. Notwithstanding, anything otherwise contained in an agreement of sale, the total of all brokerage commissions to be paid on the sale of a Residential Unit will not exceed 3% of the Purchase Price of the Residential Unit. d. All commissions will be paid at the settlement of the Residential Unit. The Trustee in his business judgment believes that the value of the assets of the estate will be maximized for the benefit of all constituencies if the Trustee is permitted to sell the approved Residential Units in Phase 1. The Debtor acquired the Project from the Redevelopment Authority of Bucks County ("RDA"). The RDA provided an acquisition loan to the Debtor in the original principal amount of $2.5 million. In connection with the RDA Loan, the Debtor granted to RDA two stated mortgages recorded against the Project in favor of the RDA: (i) Mortgage in the amount of $2.5 million dated June 13, 2003 and recorded on Aug. 25, 2003 in land record Book 3537, Page 792 (Instrument No. 20030163787); and (ii) Open-End Mortgage and Security Agreement in the amount of $127,628 dated July 21, 2016 and recorded on July 22, 2016 as instrument number 2016043135). Prior to the Petition Date, the Debtor granted to Prudential Bank the four mortgages, assignment of rents and leases, recorded against the Project in favor of Prudential and UCC-1's filed by Prudential with Department of State of the Commonwealth of Pennsylvania: (i) Collateral mortgage in the amount of $3,911,250 dated Sept. 20, 2011 and recorded on October 19, 2011 in Land Record Book 6838, Page 230 (Instrument No. 2011070888); (ii) Mortgage in the amount of $1.4 million dated Sept. 22, 2013 and recorded on Sept. 27, 2013, instrument number 2013080879; (iii) Collateral mortgage in the amount of $5,136,000 dated May 30, 2014 and recorded on July 23, 2014, instrument number 2014038527; (iv) Open-End Mortgage and Security Agreement in the amount of $5,541,468 dated Nov. 26, 2014 and recorded on Jan. 7, 2015 as instrument number 2015001098; (v) Assignment of Rents and Leases and Agreements of Sale recorded as instrument number 2015001143 filed in conjunction with the Mortgage for Existing Prudential Construction Loan; (vi) UCC-1 filed on Sept. 27, 2013 in the Bucks County Recorder of Deeds Office as instrument number 2013080881 naming Island View Crossing, II, L.P. as Debtor and Prudential as Secured Party; and (vii) UCC-1 filed on Jan. 4, 2015 in the Bucks County Recorder of Deeds Office as instrument number 2015001161 naming Island View Crossing, 11, L.P. as Debtor and Prudential as Secured Party. Prior to the Petition Date, Prudential issued two letters of credit in connection with the development of site improvements at the Project as follows: (i) Borough Letter of Credit - $1,231,087, and (ii) Aqua Letter of Credit - $30,000. On Sept. 12, 2018, the Court approved the First Financing/Approval Motion and the Release of Liens Agreement and the closing in connection with the financing from the Lender was concluded on Sept. 26, 2019. The Trustee has drawn the full amount of $4.7 million under the First Financing/Approval Motion in order to fund the cost of the improvements and other expenses associated with the Project. The Trustee has, inter alia, constructed five buildings in Phase 1 containing a total of 26 Residential Units at different stages of completion. Twelve of the 26 units are 100% complete and available for sale. The net proceeds from the sale of the completed Residential Units after payment of the release prices required by the Release of Liens Agreement and the Lender's loan documents and normal and customary closing costs will be used to fund the construction of additional Residential Units in Phase 1 which are being marketed for sale. On Dec. 20, 2019, the Trustee filed the Second Financing/Approval Motion. On Jan. 27, 2020, the Court entered an Interim Order granting the Second Financing/Approval Motion to the extent of $200,000 on an interim basis. The hearing to consider approval of the balance of the Second Loan has been continued. On Jan. 17, 2020, the Trustee filed the First Sale Motion, requesting authority to sell three Residential Units in Phase 1 (Lot Nos. 41, 44, Ind 47) free and clear of all liens, claims, and interests. The Court granted it on Feb. 12, 2020. By the Motion, the Trustee asks that the Court enters an order (i) authorizing and approving the sale of a Residential Unit in Phase 1 that is currently subject to an agreement of sale ("Under-Contract Residential Unit") to the buyer free and clear of all liens, claims and interests on substantially the same terms and conditions set forth in the agreement of sale and the Motion; (ii) authorizing procedures for the approval of future sales of Residential Units in Phase 1 free and clear of all liens, claims and interests; (iii) limiting notice of future sales of Remaining Residential Unit(s), and (iv) for related relief. Presently, the Trustee has one Under-Contract Residential Unit. In Exhibit C is a Schedule of the Under-Contract Residential Unit that details, inter alia, the applicable lot number, property address, name of the Buyer and the purchase price offered. The Trustee may receive additional agreements of sale for Remaining Residential Units prior to the hearing date on the Motion. In such case, the Trustee will supplement the Motion and the notice of the Motion by adding the additional agreement(s) of sale as additional exhibits to the Motion and will provide supplemental notice to all creditors and parties in interest of the additional agreements of sale to be considered as part of the Motion at the hearing. The Trustee also expects to receive additional agreements of sale for the Remaining Residential Units after the hearing date on the Motion and therefore asks approval of the procedures regarding future sales of the Remaining Residential Units. In accordance with the Release of Liens Agreement and the Lender's loan documents approved by the Bankruptcy Court, at the time of closing on the Under-Contract Residential Unit, the Trustee asks authority to pay from the proceeds of sale the following: a. First, the amount needed to satisfy any outstanding post-petition property taxes and post—petition municipal liens due the applicable governmental authorities; b. Second, the amount needed to satisfy the real estate commissions due the Trustee's Broker, if applicable; c. Third, the normal and customary closing costs including, but not limited to, transfer taxes and any recording fees; d. Fourth, the sum of $12,350 to the Redevelopment Authority of Bucks County; e. Fifth, to the Lender as provided in the Lender's Loan documents and the Release of Liens Agreement approved by the Court; f. Sixth, the sum of $25,000 to Prudential Bank; and g. the balance will be retained and utilized by the Trustee to finance the construction and completion of the Remaining Residential Units in Phase 1. The Trustee asks that upon approval of the Under-Contract Residential Unit, the 14-day period pursuant to Rule 6004(h) be waived by the Court. The Trustee asks authority establish procedures to approve future sales after the hearing date on the Motion of the Remaining Residential Units ﬂee and clear of the Interests. As such, he proposes these Procedures in connection to obtaining approval of future sales of the Remaining Residential Units free and clear of the Interests: a. No less than 21 days prior to the proposed closing on the sale of a Remaining Residential Unit, the Trustee will file with the Court and serve a notice of proposed sale of the Residential Unit(s), and a proposed form of Order, upon all Notice Parties. b. Any party-in-interest will have 14 days from the date of the Sale Notice to file a response to the proposed sale set forth in the Sale Notice with the Court and serve a copy upon the Trustee's counsel. c. If no response is filed within 14 days after service of the Sale Notice, the Trustee will certify the same to the Court and request the entry of the Order authorizing the sale of the Remaining Residential Unit(s). d. If a response is filed to a Sale Notice, and such dispute cannot be resolved consensually by the Trustee and the objecting party, the Trustee will contact the Court to obtain a hearing date and time to consider the Sale Notice and the response thereto. The Trustee will serve a Notice of Hearing in connection with the Sale Notice and the response thereto upon all interested parties. The Trustee also asks that (i) notice of the Sale Notice and (ii) notice of any hearing in connection with a Sale Notice be limited to the parties identified. A copy of the Exhibit C and the Agreements is available at https://tinyurl.com/qmlaa7u from PacerMonitor.com free of Charge. About Island View Crossing II Island View Crossing II, L.P., Calnshire Estates, LLC and Steeple Run, LP filed their respective Chapter 11 petitions (Bankr. E.D. Pa. Case Nos. 17-14454, 17-14457 and 17-14458, respectively) on June 30, 2017. Island View, Calnshire Estates, and Steeple Run, are affiliates of One State Street Associates which filed a voluntary petition on June 21, 2017 (Bankr. E.D. Pa. Case No. 17-14291). The Debtors are managed by Renato J. Gualtieri, a real estate developer based in Langhorne, PA. The Debtors' individual cases have not been ordered to be jointly administered or consolidated and thus, each Debtor has its own separate bankruptcy estate. The Hon. Eric L. Frank presides over these cases. The petitions were signed by Renato J. Gualtieri, president of the Debtors' corporate general partner. At the time of the filing, Calnshire Estates had estimated assets of between $10 million and $50 million and liabilities of between $1 million and $10 million. Island View Crossing and Steeple Run estimated their assets and debts at $1 million to $10 million. The Debtors tapped Smith Kane Holman, LLC as their bankruptcy counsel, and Stradley Ronon Stevens & Young, LLP as special litigation counsel. On Jan. 30, 2018, the U.S. Trustee for Region 3 appointed Kevin O'Hallaron as the Chapter 11 trustee in the case of Island View Crossing II, L.P. The trustee hired Karalis PC, as bankruptcy counsel, and Newbridge Management LLC as financial advisor. JOFFE EMERGENCY: Seeks to Hire Havkin & Shrago as Legal Counsel --------------------------------------------------------------- Joffe Emergency Services seeks approval from the U.S. Bankruptcy Court for the Central District of California to hire Havkin & Shrago, Attorneys At Law as its legal counsel. Havkin & Shrago will provide these services in connection with the Debtor's Chapter 11 case: (1) represent the Debtor at its initial interview; (2) represent the Debtor at its meeting of creditors pursuant to Bankruptcy Code Section 341(a); (3) represent the Debtor at court hearings; (4) prepare legal papers; (5) advise the Debtor regarding matters of bankruptcy law; (6) represent the Debtor in contested matters; (7) assist the Debtor in the preparation of a disclosure statement and in the negotiation, preparation and implementation of a plan of reorganization; (8) analyze secured, priority or general unsecured claims that have been filed in the Debtor's bankruptcy case; (9) negotiate with the Debtor's secured and unsecured creditors regarding the amount and payment of their claims; (10) object to claims; and (11) provide all other legal services other than adversary proceedings which would require a further written agreement. The firm will be paid at these rates: Stella Havkin, Esq. $435 per hour David Jacob, Esq. $325 per hour The Debtor paid the firm a pre-bankruptcy retainer in the sum of $15,000, exclusive of the filing fees. Havkin & Shrago is "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Stella Havkin, Esq. Havkin & Shrago Attorneys at Law 5950 Canoga Avenue, Ste. 400 Woodland Hills, CA 91367 Telephone: (818) 999-1568 Facsimile: (818) 305-6040 Email: stella@havkinandshrago.com About Joffe Emergency Services Joffe Emergency Services sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 20-12802) on March 12, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $500,001 and $1 million. Judge Sheri Bluebond oversees the case. The Debtor tapped Havkin & Shrago, Attorneys At Law as its legal counsel. JUNO USA: Exclusive Period to File Plan Extended Through June 16 ---------------------------------------------------------------- Judge Mary Walrath of the U.S. Bankruptcy Court for the District of Delaware extended to June 16 the exclusive periodsduring which Juno USA LP and its affiliates can file a Chapter 11 plan. The companies can solicit acceptances for the plan until Aug. 15. The extension will provide the companies the opportunity to confirm and implement the terms of their plan, including the distribution of assets to their creditors. About Juno USA Juno USA, LP also known as Juno Lab, L.P., was a ride-hailing, mobile application-based transportation network company that operated in New York, New York, where its headquarters are located. Juno launched its mobile application and began offering its services in early 2016. Prior to the Chapter 11 filing, Juno shut down its US operations. The company's website is https://gojuno.com Juno and five debtor affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 19-12484) on Nov. 19, 2019. In the petition signed by CRO Melissa S. Kibler, the Debtors were each estimated to have $1 million to $10 million in assets, and $100 million to $500 million in liabilities. The case has been assigned to Judge Mary F. Walrath. The Debtors tapped Chipman Brown Cicero & Cole, LLP as bankruptcy counsel; Mackinac Partners, LLC as financial advisor; and Omni Agent Solutions as notice, claims and balloting agent. KDJJ ENTERPRISES: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: KDJJ Enterprises, Inc. 850 W. Cottonwood Lane Casa Grande, AZ 85122 Chapter 11 Petition Date: March 30, 2020 Court: United States Bankruptcy Court District of Arizona Case No.: 20-03441 Debtor's Counsel: Don C. Fletcher, Esq. LAKE AND COBB, PLC 1095 W. Rio Salado Parkway, Suite 206 Tempe, AZ 85281 Tel: 602-523-3000 E-mail: dfletcher@lakeandcobb.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by David A. Ellis, president/CEO. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors at the time of the filing. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/jUX2vI KONTOOR BRANDS: Moody's Alters Outlook on Ba2 CFR to Negative ------------------------------------------------------------- Moody's Investors Service affirmed Kontoor Brands, Inc.'s, ratings including its Ba2 corporate family rating; Ba3-PD probability of default rating; and Ba2 ratings on its senior secured credit facilities. The company's SGL-2 speculative grade liquidity rating is unchanged. The outlook was changed to negative from stable. "The outlook change to negative reflects the risk that a prolonged downturn triggered by the rapid spread of the coronavirus (COVID-19) will pressure Kontoor's revenue, profitability, and credit metrics over the near to intermediate term," stated Moody's Vice President, Mike Zuccaro. "The company is in the early stages of implementing its strategic growth plan since becoming a standalone company in May 2019. Execution risk is high given the unprecedented disruptions related to widespread retail store closures and the potential for prolonged declines in discretionary consumer spending." Affirmations: Issuer: Kontoor Brands, Inc. Probability of Default Rating, Affirmed Ba3-PD Corporate Family Rating, Affirmed Ba2 Senior Secured Bank Credit Facility, Affirmed Ba2 (LGD3) Outlook Actions: Issuer: Kontoor Brands, Inc. Outlook, Changed To Negative From Stable RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The apparel sector has been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Kontoor's credit profile, including its exposure to widespread store closures and discretionary consumer spending have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Kontoor remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact on Kontoor of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. Kontoor's Ba2 CFR reflects the iconic nature of its two main brands, Wrangler and Lee, both with global reach, meaningful scale and deep customer relationships that drove total company net revenues to exceed $2.5 billion for the latest fiscal year ended December 28, 2019. The rating also reflects the company's solid profitability, with EBITDA margins in the low-teens, consistent free cash flow generation, and governance considerations such as a conservative leverage policy that balances a focus on debt repayment with a high dividend payout. Kontoor's liquidity profile is good, supported by typically solid free cash flow generation and $106.8 million of cash as of December 28, 2019, which was recently augmented by an aggregate of $475 million in drawdowns from its revolving credit facility as a precautionary measure given the challenging environment related to the coronavirus. The rating is constrained by high sales concentration within one major customer, and limited product diversification with a majority of total company sales derived from the sale of men's bottoms. The rating also considers exposure to fashion risk, and volatile input costs and foreign exchange rates, all of which can have a meaningful impact on earnings and cash flows. The rating further considers the execution risks related to the transition to a standalone business, including the potential for increased costs and potential management distraction or business disruption. Factors that would lead to an upgrade or downgrade of the ratings: The ratings could be downgraded if revenue or earnings deteriorated, if liquidity weakened through free cash flow turning negative or tighter covenant cushion, or if financial policies were to be more aggressive than anticipated, such as higher than expected shareholder returns. Specific metrics include debt/EBITDA sustained above 4.0 times or FFO/Net Debt falling below 20% on a sustained basis. Given the negative outlook as well as the company's product and customer concentrations and recent revenue declines, a ratings upgrade is unlikely over the near-to-intermediate term. To be upgraded, the company would need to return to sustainable revenue and profit growth in both brands, increase product and customer diversity, continue to generate positive free cash flow, and maintain credit metrics at or below pro forma levels, with debt/EBITDA sustained in the low- to mid-3 times range and FFO/Net Debt in the mid- to high-20% range. Kontoor Brands, Inc., headquartered in Greensboro, North Carolina, is a leading global denim and apparel company consisting mainly of its Wrangler and Lee brands, and the VF Outlet stores. LASALLE GROUP: Exit Plan for Cinco Ranch, Pearland Confirmed ------------------------------------------------------------ Bankruptcy Judge Stacey G. Jernigan issued an order confirming the First Amended Joint Plan of Liquidation of Cinco Ranch Memory Care, LLC and Pearland Memory Care, LLC filed by The Lasalle Group, Inc., et al. The Court concludes that the Plan implements the sale of the Cinco Ranch Assets and the Pearland Assets and the receipt of the Cinco Ranch Proceeds and Pearland Proceeds, as applicable, shall fund the Plan payments for each respective debtor case. The modifications and amendments in the Plan set forth on the record at the Confirmation Hearing, or made by this Confirmation Order, do not materially and adversely affect or change the treatment of any creditor who has not accepted such modifications. Accordingly, pursuant to Bankruptcy Rule 3019, such modifications do not require additional disclosure under Section 1125 of the Bankruptcy Code, or re-solicitation of acceptances or rejections under Section 1126 of the Bankruptcy Code, nor do they require that holders of Claims not accepting such modifications be afforded an opportunity to change previously cast acceptances or rejection of the Plan. In accordance with Bankruptcy Rule 3016(a), the Plan is dated and identifies the Debtors as proponents of the Plan. The Debtors appropriately filed the Disclosure Statement and the Plan with the Court, thereby satisfying Bankruptcy Rule 3016(b). The Plan also complies with any and all applicable provisions of the Bankruptcy Code and Bankruptcy Rules, thereby satisfying Section 1129(a)(1). The Court makes further findings that the Plan complies with the applicable provisions of the Bankruptcy Code and the Bankruptcy Rules. The Debtors have proposed the Plan in good faith and not by means forbidden by law, thereby satisfying Bankruptcy Code Section 1129(a)(3). The Court has examined the totality of the circumstances surrounding the formulation of the Plan. Based on the evidence presented at the Confirmation Hearing, the Court finds and concludes that the Plan has been proposed with the legitimate and honest purpose of liquidating the Debtors' assets in a fashion to maximize the recovery to the Debtors' creditors in accordance with the priorities set forth in the Bankruptcy Code. The Plan is a liquidating plan and the funding of which is dependent upon the successful liquidation of the Debtors' assets, and thus the feasibility requirement of Bankruptcy Code Section 1129(a)(11) is satisfied. The bankruptcy case is in re: THE LASALLE GROUP, INC., et al., Chapter 11, Debtors, Case No. 19-31484-sgj-11 (Bankr. N.D. Tex.). A copy of the Court's Findings and Order dated Feb. 28, 2020 is available at https://bit.ly/38xzMw5 from Leagle.com. The LaSalle Group, Inc., Debtor, represented by Vickie L. Driver -- vickie.driver@crowedunlevy.com -- Crowe & Dunlevy, William H. Hoch, III, Crowe & Dunlevy, P.C., Christopher Michael Staine -- christopher.staine@crowedunlevy.com --Crowe & Dunlevy, P.C. & Christina Walton Stephenson -- christina.stephenson@crowedunlevy.com -- Crowe & Dunlevy. West Houston Memory Care, LLC, Riverstone Memory Care, LLC, Pearland Memory Care, LLC & Cinco Ranch Memory Care, LLC, Debtor In Possessions, represented by Vickie L. Driver, Crowe & Dunlevy, William H. Hoch, III, Crowe & Dunlevy, P.C. & Christina Walton Stephenson, Crowe & Dunlevy. United States Trustee, U.S. Trustee, represented by Stephen McKitt, United States Trustees. Official Committee of Unsecured Creditors, Creditor Committee, represented by Stacy A. Lutkus, James H. Millar, Drinker Biddle & Reath LLP & Vincent P. Slusher -- vince.slusher@faegredrinker.com --Faegre Drinker Biddle & Reath LLP. About The LaSalle Group The LaSalle Group, Inc., along with certain of its subsidiaries, designs, develops, builds, and owns interests in memory care assisted living communities designed specifically for people with Alzheimer's and other forms of dementia. The communities operate under the name Autumn Leaves. LaSalle is a holding company for numerous wholly owned, non-debtor subsidiaries and affiliates. It directly and indirectly owns interests in 40 memory care assisted living communities located in Texas, Illinois, Georgia, Florida, Kansas, Missouri, Oklahoma, South Carolina, and Wisconsin. LaSalle and its subsidiaries sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Lead Case No. 19-31484) on May 2, 2019. At the time of the filing, the Debtors estimated assets of between $10 million and $50 million and liabilities of the same range. The cases are assigned to Judge Stacey G. Jernigan. The Debtors tapped Crowe & Dunlevy, P.C. as their legal counsel; Haynes and Boone, LLP as special counsel; Karen Nicolaou of Harney Partners Management, LLC as chief restructuring officer; and Donlin, Recano & Company, Inc. as claims and noticing agent. The Office of the U.S. Trustee appointed a committee of unsecured creditors on July 3, 2019. The committee is represented by Drinker Biddle & Reath LLP. LEE'S FOODSERVICE: Taps FactorLaw as Legal Counsel -------------------------------------------------- Lee's Foodservice Parts & Repairs, Inc., received approval from the U.S. Bankruptcy Court for the Northern District of Illinois to hire FactorLaw as its legal counsel. The firm will provide these services in connection with the Debtor's Chapter 11 case: 1. advise the Debtor of its powers, rights and duties; 2. attend meetings and negotiate with creditors and other parties; 3. advise the Debtor on the conduct of the case, including all of the legal and administrative requirements of operating under Chapter 11; 4. take all necessary actions to protect and preserve the Debtor's bankruptcy estate, including prosecuting or defending proceedings on behalf of the Debtor; 5. prosecute or defend adversary proceedings or other litigations involving the Debtor; 6. prepare legal papers; 7. prepare and negotiate a plan and disclosure statement, and take necessary actions to obtain confirmation of a plan; and 8. provide other necessary legal services related to the case. The firm will be paid at these rates: William Factor Partner $400 per hour Jeffrey Paulsen Partner $375 per hour Angela Snell Partner $375 per hour Elizabeth Peterson Associate $350 per hour Danielle Ranallo Legal Assistant $100 per hour The Debtor praid the firm a $50,000 retainer. Angela Snell, Esq., at William J. Factor, disclosed in court filings that the firm is "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: William J. Factor, Esq. Angela M. Snell, Esq. FactorLaw 105 W. Madison Street, Suite 1500 Chicago, IL 60602 Tel: (312) 878-6976 Fax: (847) 574-8233 E-mail: asnell@wfactorlaw.com About Lee's Foodservice Founded in 1998, Lee's Foodservice Parts & Repairs, Inc. -- https://www.leesfoodservice.com/ -- provides commercial foodservice and commercial kitchen repair, installation, and maintenance in the Chicago, Milwaukee, and Northwest Indiana areas. Lee's Foodservice sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 20-03086) on Feb. 3, 2020. It previously sought bankruptcy protection on March 11, 2013 (N.D. Ill. Case No. 13-09454). In the petition signed by Brian Anderson, president, the Debtor was estimated to have $1 million to $10 million in assets and $1 million to $10 million in liabilities. Judge Lashonda A. Hunt oversees the case. The Debtor tapped Angela M. Snell, Esq., at FactorLaw, as its legal counsel. LESBRAN GROUP: Seeks to Hire Thomas E. Crowe as Legal Counsel ------------------------------------------------------------- Lesbran Group, LLC, seeks approval from the U.S. Bankruptcy Court for the District of Nevada to hire Thomas E. Crowe Professional Law Corporation as its legal counsel. The firm will advise the Debtor regarding bankruptcy law and will provide other legal services in connection with its Chapter 11 case. The firm will be paid at these rates: Attorney $425 Paralegal $175 The Debtor paid the firm a retainer of $3,283, plus $1,717 for the filing fee. Thomas Crowe, Esq., disclosed in court filings that his firm has no interest materially adverse to the interest of the Debtor's bankruptcy estate and creditors. The firm can be reached through: Thomas E. Crowe, Esq. Thomas E. Crowe Professional Law Corporation 2830 S. Jones Blvd. Las Vegas, Nevada 89146 Phone: (702) 794-0373 E-mail: tcrowe@thomascrowelaw.com About Lesbran Group Lesbran Group, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No. 20-11294) on March 5, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of less than $50,000. Judge August B. Landis oversees the case. The Debtor tapped Thomas E. Crowe Professional Law Corporation as its legal counsel. LNB-002-2013: U.S. Bank Objects to Amended Plan & Disclosure ------------------------------------------------------------ U.S. Bank National Association, as Indenture Trustee on behalf of and with respect to Ajax Mortgage Loan Trust 2018-B, Mortgage-Backed Notes as the primary and largest holder of debt of Debtor LNB-002-2013, LLC, objects to Debtor's Amended Chapter 11 Plan of Reorganization and to Debtor’s Amended Disclosure Statement, and states as follows: * The Debtor lists in the Disclosure Statement the events leading up to bankruptcy as simply the Property was purchased by Debtor from the condominium. Debtor had no financial track record prior to this purchase and the sole basis for filing this bankruptcy was to thwart the judicial foreclosure of the Property by Creditor following the Obligors default under the terms and conditions of the loan documents. * There is no debtor-creditor relationship between Debtor and Creditor; therefore, the mortgage debt is not a claim within the meaning of Sec. 101(5). As a result, Debtor cannot force Creditor to negotiate a settlement when Debtor is not in privity of contract with Creditor. * The Debtor's Liquidation Analysis attempts to value the Property at $625,000, but Debtor offers no support to prove this value. The Debtor has not provided an appraisal. Creditor, on the other hand, did obtain an appraisal that values the Property at $770,000. * The Debtor provides absolutely no projections regarding the anticipated future of the Company. The Debtor provides no forecast for property values, rental needs in the community or even fair market rental rates. In fact, since this is a single asset real estate case and the only income are the rents received, the Debtor has failed to adequately address where it will have sufficient income to make its Plan payment. * Failure to provide the source of information stated in the disclosure statement results in a faulty disclosure statement that must be rejected, and confirmation of the Plan denied. * Creditor objects to treatment of its claim in the Plan as it proposes to alter the terms of the original obligation by reducing the total amount of the Claim, despite entry of the Final Judgment of Foreclosure, reducing the interest rate and extending the maturity, none of which are permissible. * The Debtor attempts to pay Creditor over a 30-year amortization period that does not mature until May 1, 2035. This amount of time provides for payments to all other creditors long before Creditor is paid in full thus violating the absolute priority rule. A full-text copy of U.S. Bank's objection to the Plan and Disclosure Statement, which objection was filed March 13, 2020, is available at https://tinyurl.com/v4afqog from PacerMonitor at no charge. Attorneys for the Creditor: Allison D. Thompson THE SOLOMON LAW GROUP, P.A. 1881 West Kennedy Boulevard, Suite D Tampa, Florida 33606-1611 Tel: (813) 225-1818 Fax: (813) 225-1050 E-mail: athompson@solomonlaw.com About LNB-002-2013 LLC LNB-002-2013, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-20502) on Aug. 28, 2018. In the petition signed by Laurent Benzaquen, manager LNB Capital LLC, the Debtor was estimated to have assets of less than $50,000 and liabilities of less than $500,000. The Debtor tapped Joel M. Aresty P.A. as its legal counsel. No official committee of unsecured creditors has been appointed in the case. LUNA DEVELOPMENTS: May 13 Plan & Disclosures Hearing Set -------------------------------------------------------- On March 17, 2020, the U.S. Bankruptcy Court for the Southern District of Florida, Fort Lauderdale Division, conducted a hearing to conditionally approve the Amended Disclosure Statement with respect to the Plan of Liquidation filed by Debtor Luna Developments Group, LLC. On March 19, 2020, Judge Scott M. Grossman conditionally approved the Disclosure Statement and established the following dates and deadlines: * May 13, 2020, at 2:30 p.m. in the United States Bankruptcy Court, United States Courthouse, 299 E. Broward Blvd., Courtroom 308, Fort Lauderdale, FL 33301 is the hearing on final approval of Disclosure Statement, Confirmation Hearing, and hearing on fee applications. * April 29, 2020, is the deadline for objections to claims. * April 29, 2020, is the deadline for filing ballots accepting or rejecting plan. * April 29, 2020, is the deadline for objections to confirmation. * April 29, 2020, is the deadline for objections to final approval of the Disclosure Statement. A full-text copy of the order dated March 19, 2020, is available at https://tinyurl.com/wxtye5d from PacerMonitor at no charge. General Counsel to Receiver: Jason S. Rigoli, Esq. Furr Cohen, P.A. 2255 Glades Road, Suite 301E Boca Raton, Florida 33431 Tel: (561) 395-0500 Fax: (561) 338-7532 E-mail: jrigoli@furrcohen.com About Luna Developments Group The receiver for Luna Developments Group, LLC, a company based in West Palm Beach, Florida, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 19-11169) for Luna Developments on Jan. 28, 2019. In the petition signed by Alan Barbee, the receiver appointed by a Florida state court, the Debtor disclosed $5,000,000 in assets and $3,366,816 in liabilities. The Hon. Erik P. Kimball oversees the case. Robert C. Furr, Esq., at Furr Cohen, serves as the Debtor's bankruptcy counsel. No official committee of unsecured creditors has been appointed. MACON CONCRETE: Seeks to Hire Dean W. Greer as Legal Counsel ------------------------------------------------------------ Macon Concrete Products, Inc. seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to hire the Law Offices of Dean W. Greer 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 preparation of a reorganization plan. The firm will charge an hourly fee of $300. Dean W. Greer has no material interest adverse to the interest of the Debtor's bankruptcy estate, creditors and equity holders, according to court filings. The firm can be reached through: Dean William Greer, Esq. Law Offices of Dean W. Greer 2929 Mossrock, Suite 117 San Antonio, Texas 78230 Telephone: (210) 342-7100 Telecopier: (210) 342-3633 Email: dwgreer@sbcglobal.net About Macon Concrete Products Macon Concrete Products, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Texas Case No. 20-50628) on March 20, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $100,001 and $500,000. The Debtor tapped Law Offices of Dean W. Greer as its legal counsel. METHANEX CORP: Fitch Lowers LongTerm IDR to BB, Outlook Negative ---------------------------------------------------------------- Fitch Ratings has downgraded Methanex Corporation's Long-Term Issuer Default Rating (IDR) and senior unsecured debt to 'BB' from 'BBB-' and assigned all associated unsecured debt an 'RR4' Recovery Rating. The Rating Outlook is Negative. The downgrade and Outlook reflect the impact of lower methanol prices on the company's leverage metrics within Fitch's forecast and, in conjunction with Geismar 3 expansion spending, the company's lower forecasted liquidity profile. Fitch's base case forecasts Methanex's leverage metrics will be considerably above 'BB' rating tolerances over the next 18 months to 24 months due to the negative impacts of the coronavirus pandemic on global demand and pricing. Subject to pricing, Fitch forecasts Total Debt with Equity Credit/Operating EBITDA between 5.5x and 8.5x in the near-term, trending toward 3.0x in 2023. The rating action also considers the potential for heightened project risks as management attempts to offset the leverage and liquidity impacts of higher capital spending in a weak price environment. Fitch believes that, without a delay in G3 spending, this mismatch of cash flows and spending could result in the need for increased debt funding and a durable increase in leverage. Any delays or cost overruns in the G3 project would compound this issue, heightening the project's execution risk. The rating also reflects methanol's sensitivity to crude and natural gas prices and China's demand, particularly at methanol-to-olefins (MTO) facilities; the negative impact that a prolonged trade war with China could have on the industry; and the significant expense associated with maintaining shipping and storage facilities as a global market maker in methanol. Offsetting considerations include the company's position as the largest global supplier of methanol, with a global distribution network and 9.15 million metric tons (MT) in production capacity. The ratings also reflect the company's portfolio high-grading, including relocation of Chilean plants to the U.S.; the company's good historical financial performance, driven by access to low cost and stranded natural gas feedstocks; and solid historical FCF and leverage metrics. KEY RATING DRIVERS Methanol Prices Pressure Margins: Average realized price for Methanex fell to $272/ton in Q3 of 2019 and then to $256/ton in Q4. Fitch expects to see additional downside in terms of pricing and utilization rates as the coronavirus pandemic impacts demand. Additionally, Fitch views the company's MTO segment - a leading growth area in recent years - as especially vulnerable to prolonged demand pressure relative to recent performance, particularly with ethylene and polyethylene prices expected to remain depressed throughout the ratings horizon. The sharp fall in methanol prices highlights the relatively higher cash flow risk for methanol producers like Methanex relative to Investment Grade chemical peers. Fitch believes that methanol prices will continue to fall in the near-term - because of methanol's use as an energy application, the recent collapse in oil prices is expected to pressure methanol prices. In order to prepare for lower demand for methanol, Methanex has elected to idle production at its Titan plant and its Chile IV plan Elevated Leverage Profile: Fitch believes that it still makes economic sense to complete the cost-advantaged G3 expansion despite methanol prices well under $300/ton, while managing its credit risk profile. Methanex has the funding to do so, with an $800 million delayed drawn term loan and a $300 million revolver, both undrawn as of YE 2019. Fitch anticipates that the company will use these facilities to fund the G3 project. The company has articulated a desire to find a partner to help fund the expansion, but the current economic situation is likely to make it considerably more difficult to do so, making debt funding more likely. Accordingly, Fitch's Base Case, which includes a mid-2022 completion of G3, includes Total Debt with Equity Credit/Operating EBITDA trending toward 3.0x throughout the forecast. Should the company demonstrate flexibility in the timing of G3 expenditures, Fitch believes that the combination of debt funding and lower EBITDA generation would leave the medium-term leverage profile similar to that of Fitch's Base Case. Fitch will continue to monitor the company's progress on the project, and the associated financial and operational execution risk. Pressured FCF Generation Forecasted: Methanex's position as a low-cost producer has allowed it to achieve generally favorable cash generation, with cash outlays often directed toward capital expenditures and a steady dividend. Fitch anticipates substantially lower FCF over the ratings horizon, given the large decline in methanol prices, macroeconomic headwinds, and the company's commitment to funding the G3 project. Fitch expects the company to delay certain capital expenditures to the extent that it can - however, the extent to which the company is able to do so will depend on the speed with which methanol prices return to historical levels. Should the company demonstrate flexibility in the timing of G3 expenditures, the relieved pressure on near-term FCF generation would be offset with increased execution risk and tighter liquidity in the latter end of the forecast period. Heightened G3 Execution Risk: Methanex's $1.3 billion-$1.4 billion, 1.8 million MT Geismar 3 (G3) expansion creates short-term risks and longer-term opportunities for the credit. At an estimated $775/MT, the Brownfield G3 project has a number of cost advantages, including shared storage and terminal facilities; lack of need to build a reformer given the ability to use purge gas; procurement synergies, and amortization of other fixed costs over a larger production base. Medium-term credit risks include cost overruns and delays, as well as the matching of cash flows during the ongoing methanol price trough during construction. G3's production is expected to come online in 2H 2022, but this could be delayed as management may look to offset its forecasted elevated leverage and weakened liquidity profiles. Energy Applications Drive Price: Methanol prices are volatile, and correlated to oil prices, while methanol's feedstock costs are linked to natural gas and coal prices in Asia. As a result, sharp declines in the oil/gas price ratio can periodically pressure the credit. Methanol demand is increasingly driven by methanol for energy applications, which, prior to the downturn, had been the fastest growing component of demand, and included MTO plants; gasoline blendstocks to increase octane (MTBE); a substitute for bunker fuel, and as an industrial boiler fuel. Energy applications for methanol are sensitive to demand in China, particularly MTO, which could cap methanol prices. Low Cost Producer: Methanex is the largest global supplier of methanol, with 9.15 million MT of capacity, and sales of 11.1 million MT or about 13% of the methanol market. Natural gas is the main feedstock and is its single largest expense. Methanex's portfolio benefits from low cost/stranded gas. The company's plants outside North America have credit-friendly contract structures, which include a low initial fixed gas price, plus a variable component that is shared between Methanex and the gas supplier as methanol prices rise. This structure is countercyclical insofar as it lowers the company's costs in a down-cycle in exchange for surrendering some methanol price-related gains on the upside. Methanex's North American plants (Geismar 1 & 2, and Medicine Hat, Canada) lack these features but benefit from low gas prices linked to the shale revolution. DERIVATION SUMMARY Relative to the IG chemical companies, Methanex has exhibited relatively higher cash flow volatility stemming from its single-commodity product focus. The company's single product focus on methanol means it is less diversified than integrated chemical producers such as Eastman Chemical Company (BBB/Negative) and Westlake Chemical (BBB/Stable), and more in line with certain U.S. Oil and Natural Gas producers like CNX Resources Corporation (BB/Stable) and Antero Resources Corporation (BB-/Negative). YE 2019 Total Debt with Equity Credit/Operating EBITDA for Methanex was 4.4x, which compares unfavorably to Eastman and Westlake at 2.8x and 2.5x respectively. CNX Resources and Antero Resources are expected to see similarly elevated leverage over the medium term following the collapse in oil and natural gas prices. Fitch anticipates Methanex's leverage to peak in 2020, declining thereafter. However, this is offset by the company's strong position as the world's largest supplier of methanol, its portfolio of geographically diversified, low-cost plants, and a supportive pricing environment. MEOH's margins are in line with IG chemical peers but more cyclical given methanol's linkage to crude and coal pricing, and sensitivity to China's demand for methanol in energy applications. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- Methanol prices trough in 2020-2021, recovering thereafter; -- G3 expansion continues as planned - no partner considered for G3; -- Delayed draw term loan (DDTL) fully drawn to fund G3; -- Share repurchases halted for the duration of the forecast. RATING SENSITIVITIES A revision of the Outlook to Stable could be considered should methanol prices rebound faster than anticipated, potentially reducing the amount of debt funding necessary to complete the G3 expansion and leading to Fitch's expectation of FFO Adjusted Leverage sustainably below 4.5x and/or Total Debt with Equity Credit/Operating EBITDA sustainably below 3.5x. Developments That May, Individually or Collectively, Lead to Positive Rating Action -- FFO Adjusted Leverage durably below 4.0x, potentially due to finding a beneficial partner to help fund the G3 expansion alongside a faster-than-anticipated recovery in and favorable outlook for methanol prices; -- Increased product diversification. Developments That May, Individually or Collectively, Lead to Negative Rating Action -- FFO Adjusted Leverage durably above 4.5x and/or Total Debt with equity Credit/Operating EBITDA durably above 3.5x, potentially due to a sustained trough in methanol prices and a lower demand for MTO production; -- Cost overruns, delays, or realization of other execution risk related to G3 expansion leading to stepped up borrowings; -- Sustained disruption in operations of major facilities. METRO PUERTO RICO: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Metro Puerto Rico LLC PO Box 363135 San Juan, PR 00936-3135 Chapter 11 Petition Date: March 31, 2020 Court: United States Bankruptcy Court District of Puerto Rico Case No.: 20-01543 Debtor's Counsel: Jose Prieto, Esq. JPC LAW OFFICE PO Box 363565 San Juan, PR 00936-3565 Tel: (787) 607-2166 E-mail: jpc@jpclawpr.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Felix I. Caraballo, president. A copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/wtoAL2 MOORE PROPERTIES: Court Okays Small Business Debtor Designation --------------------------------------------------------------- Bankruptcy Judge Benjamin A. Kahn issued a memorandum order overruling the objection of the Bankruptcy Administrator's to Moore Properties of Person County, LLC's designation as a small business debtor. On Feb. 10, 2020, the Debtor filed a voluntary petition for relief under chapter 11. The Debtor owns three separate parcels of real property, which it leases to third parties who engage in farming operations. The Debtor has no business operations outside of its leasing of the real properties and matters incidental thereto. The petition was precipitated by two pending foreclosure actions, one against each of the Debtor's properties. In its statement filed with the petition under Fed. R. Bankr. P. 1020(a), the Debtor stated that it is a small business debtor as defined in 11 U.S.C. section 101(51D). On Feb. 13, 2020, the BA objected under Fed. R. Bankr. P. 1020(b) and 11 U.S.C. section 101(51D) to the Debtor's designation of itself as a small business debtor on its petition. In the Objection, the BA asserted that the Debtor failed to meet the definition of a small business debtor on the petition date because it primarily owned and managed real property. On August 23, 2019, President Donald Trump signed the Small Business Reorganization Act of 2019 (the "SBRA"), thereby effectuating its enactment. Section 5 of the SBRA provides in full: "This Act and the amendments made by this Act shall take effect 180 days after the date of enactment of this Act." Therefore, the SBRA became effective on Feb. 19, 2020. In its central purpose, the SBRA added a new subchapter V to chapter 11 as an elective chapter for small business debtors for whom the existing provisions of chapter 11 were not providing effective relief. Five days after the SBRA became effective, the Debtor filed an amended petition under Fed. R. Bankr. P. 1009(a), amending its statement under Fed. R. of Bankr. P. 1020(a), still designating itself as a small business, but electing to proceed under the newly effective subchapter V of chapter. At the hearing on Feb. 25, 2020, no party objected to the Debtor's amended election to proceed under subchapter V, and according to the BA, the Debtor's only secured creditor, Carolina Farm Credit, does not object either to the Debtor's designation as a small business or to the Debtor's election to proceed under subchapter V. With the exception of the Claims Notice, no procedural or substantive rights have vested in this nascent case in a manner that will prejudice any party in interest, and no creditor will be prejudiced by the application of the provisions of the SBRA to this case or by the change in the Debtor's statement electing to proceed under subchapter V. The parties in this case present two issues: (1) may the Debtor, whose case was pending on the effective date of the SBRA, elect to proceed under subchapter V of chapter 11; and (2) is the Debtor, who did not meet the definition of a small business debtor on the petition date, eligible to proceed under subchapter V when it now meets that definition under the SBRA? Because the Debtor only meets the definition of a small business debtor to the extent that the SBRA applies, these issues bleed into one another. Under Fed. R. Bankr. P. 1020(a), a debtor must state in its bankruptcy petition "whether the debtor is a small business debtor and, if so, whether the debtor elects to have subchapter V of chapter 11 apply." Despite failing to meet the definition of a small business on the petition date, the Debtor stated that it is a small business on its petition. "[T]he status of the case as a small business case or a case under subchapter V of chapter 11 shall be in accordance with the debtor's statement under this subdivision, unless and until the court enters an order finding that the debtor's statement is incorrect." After a Debtor elects to be a small business debtor, "[t]he United States trustee or a party in interest may file an objection to the debtor's statement under subdivision (a) no later than 30 days after the conclusion of the meeting of creditors held under section 341(a) of the Code, or within 30 days after any amendment to the statement, whichever is later." Put simply, the original designation controls unless and until the court enters an order finding that a debtor's election is incorrect, and such "review is triggered by an objection to the designation." Therefore, through the date of the hearing on the BA's objection, the Debtor was a small business debtor. Among other amendments, the SBRA changed the definition of "small business debtor." Under the SBRA, the definition of small business now only excludes those owners of real property that constitute "single asset real estate." As defined under 11 U.S.C. section 101(51B) and as relevant to this case, single asset real estate ("SARE") is limited to real property constituting a single property. . . ." The Debtor's property consists of at least two separate parcels, each generating the Debtor's revenue. Therefore, the Debtor's property is not SARE, and the Debtor meets the definition of a small business debtor as of the date of the hearing on the BA's objection, and is entitled to elect application of subchapter V. As such, "an amendment to a Bankruptcy Petition can be made at any time as a matter of course at any time before the case is closed." Therefore, Debtor was entitled to amend its statement to elect subchapter V. The Court concludes the Debtor designated itself as a small business debtor on the petition date, and that designation controls unless and until the Court determines that it is incorrect. As of the date of the hearing in this case, the designation was not incorrect, and the Debtor is a small business debtor. As a small business debtor, the Debtor was entitled to make the election to have subchapter V apply. The BA's objection, therefore, is overruled. A copy of the Court's Memorandum Order dated Feb. 28, 2020 is available at https://bit.ly/2wIRgsk from Leagle.com. About Moore Properties of Person County Moore Properties of Person County, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D.N.C. Case No. 20-80081) on Feb. 10, 2020. At the time of the filing, the Debtor disclosed assets of between $100,001 and $500,000 and liabilities of the same range. Judge Benjamin A. Kahn oversees the case. The Debtor tapped James C. White, Esq., at J.C. White Law Group, PLLC, as its legal counsel. NEW GARDEN: Unsecured Creditors to Have 5% Recovery Under Plan -------------------------------------------------------------- Debtor New Garden, Inc., filed with the U.S. Bankruptcy Court for the Eastern District of Massachusetts a Plan of Reorganization and a Disclosure Statement on March 13, 2020. Class I consists of the unsecured non-priority claims. The Class I creditors will be paid a distribution of 5% of their allowed claim upon the effective date. Filed proofs of claim total $158,830. There are additional claims which total $682,969 which are allowed claims. The total allowed claims are $841,798, 5% of which is $42,090. Class II consists of the stock ownership interest owned by Raymond So in the Debtor. Raymond So will retain his 100% stock interest in the Debtor and his claim will not be impaired. The Debtor will continue to operate its business from the present location of 40 Chestnut Place, in Needham, Massachusetts. A full-text copy of the Plan and the Disclosure Statement dated March 13, 2020, is available at https://tinyurl.com/v38lkxb from PacerMonitor at no charge. The Debtors are represented by: Gary W. Cruickshank, Esq. 21 Custom House Street, Suite 920 Boston, MA 02110 Tel: (617) 330-1960 E-mail: 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. The petition was signed by Raymond So, president. At the time of the filing, the Debtor had estimated assets of less than $500,000 and liabilities of less than $1 million. Judge Frank J. Bailey oversees the case. The Debtor is represented by Gary W. Cruickshank. NEW WAY TRANSPORT: May 19 Plan & Disclosure Hearing Set ------------------------------------------------------- Debtor New Way Transport, Inc., filed with the U.S. Bankruptcy Court for the Middle District of Florida, Orlando Division, a Disclosure Statement and a Plan of Reorganization. On March 17, 2020, Judge Karen S. Jennemann ordered that: * The Disclosure Statement is conditionally approved. * May 19, 2020, at 02:00 PM in Courtroom 6A, 6th Floor, George C. Young Courthouse, 400 West Washington Street, Orlando, FL 32801 is the combined disclosure and confirmation hearing. * Any party desiring to object to the disclosure statement or to confirmation shall file its objection no later than seven days before the date of the Confirmation Hearing. * The Debtor will file a ballot tabulation no later than four days before the date of the Confirmation Hearing. * Four days prior to the confirmation hearing, the Debtor will file a confirmation affidavit which shall contain the factual basis upon which the Debtor relies in establishing that each of the requirements of 11 U.S.C. Sec. 1129 of the Bankruptcy Code are met. A full-text copy of the order dated March 17, 2020, is available at https://tinyurl.com/sn8y5xt from PacerMonitor at no charge. About New Way Transport New Way Transport, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-03707) on June 5, 2019. At the time of the filing, the Debtor was estimated to have assets of less than $50,000 and liabilities of less than $1 million. The case is assigned to Judge Cynthia C. Jackson. Bartolone Law, PLLC is the Debtor's bankruptcy counsel. NFINITY GROUP: Amare Buying Phoenix Property for $260K ------------------------------------------------------ Nfinity Group, Inc. asks the U.S. Bankruptcy Court for the District of Arizona to authorize the sale of the real property located at 4401 N. 12th Street, Phoenix, Maricopa County, Arizona, residential units 214, 215, 216, and 117, to Amare Industry, LLC and/or their nominee for $260,000. As of the Petition Date, Nfinity owned the Real Property, and legally described as Units 214, 215, 216 and 117, Brookview Condominiums, a Condominium, as created by Condominium Declaration recorded May 9, 2006 in Recording No. 2006-0626779, Amendment recorded March 28, 2008 in Recording No. 2008-0276062, and as shown on Plat recorded in Book 836 of Maps, Page 6, records of Maricopa County, Arizona, together with an undivided interest in the Common Elements of such Condominium. Nfinity wishes to sell the Real Property as part of its Chapter 11 reorganization. Nfinity desires to accept the Purchaser’s offer and on Feb. 24, 2020 entered into the Residential Real Estate Purchase Contract. The Purchasers desire to close the sale transaction on March 13, 2020. Nfinity approximated the value of the Real Property as $270,000 in its Schedules. The value was based on activity in the marketplace. The Purchasers' offer is indicative of the current marketplace. Nfinity believes the current offer of $260,000 is indicative of today’s market and because the property is being sold "as is." The transaction is to close on March 13, 2020. Of the purchase price, a $5,000 earnest money deposit has already been provided by the Purchasers being held in escrow by Magnus Title, Phoenix, Arizona. The Purchasers are obtaining a loan to finance the remaining $255,000 balance of the purchase price to be paid at the close of escrow, which is currently scheduled for March 13, 2020 pursuant to the terms of the Contract. There are no commissions to be paid as this being done without the assistance of a realtor and each party agrees to pay their own costs in this sale transaction. Pro rations will be made for real and personal property taxes, assessments and other normal and recurring costs and expenses relating to the Real Property as of the date of the close of escrow, and a carve out for the increased UST quarterly fees as a result of the distribution from the bankruptcy estate (estimated to be $1,950). Nfinity will pay the premium for the Standard Owner's Policy of Title Insurance to be issued in favor of the Purchasers in the amount of the purchase price. As of the Petition Date, Nfinity owed approximately $1,712.00 in real property taxes to the Maricopa County Treasurer which would also be paid from the sale transaction. The sale proceeds will be sufficient to pay DO Capital Group the full amount that it would be allowed on its secured claim. Brookview Condominium Association also claims liens on the property, which is subject to a dispute in litigation, but whatever amount is ultimately approved in that litigation would also be paid from the sale proceeds. The sale is subject to higher and better offers at the time of the sale hearing. Any potential higher bidder would be required to provide at the time of the hearing a $5,000 non-refundable deposit, and subject to close on terms substantially similar or better than the present offer. Nfinity Group has entered into the contract without the assistance or employment of a broker or realtor. DO Capital Group claims a first position lien on the Real Property in the approximate amount of $84,813 as evidenced by that certain Deed of Trust dated Dec. 18, 2017 and recorded on Dec. 22, 2017 at Book 836 of Maps, Page 6, in the records of Maricopa County, Arizona. Brookview Condominium Association also claims recorded liens on the Real Property as evidenced by liens dated Jan. 20, 2011 and recorded on Jan. 27, 2011 at recording number in 20110076408, 20110076409, 20110076410, and 20110076411 filed in the Maricopa County Assessors Office, but this asserted lien is subject to a dispute in litigation. The underlying sales transaction will be free and clear of all liens, claims, and interests, so that the Purchaser will take the Property free and clear of liens and future disputes to the buyer. Any liens, claims, and interests will attach to the net sale proceeds and paid as set forth. All standard closing costs, commissions, the secured liens of DO Capital as may be allowed by the Court, Brookview Condominium HOA as may be allowed by the Court, all real property taxes presently owing to Maricopa County, and the $1,950 carve out for the UST quarterly fees, in the amounts that would be allowable under the Bankruptcy Code, are intended to be paid directly out of the escrow. The sale is subject to higher and better offers at the time of the sale hearing. Under the circumstances, it appears that the sale price of $260,000 generates funding with which to satisfy all secured obligations on the Properties. Accordingly, Nfinity Group asks that the sale be free and clear of all liens, claims and interests so that the Purchasers may receive the Real Property free of future disputes and claims. A copy of the Contract is available at https://tinyurl.com/w8ol8wy from PacerMonitor.com free of charge. About Nfinity Group Nfinity Group, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 20-00376) on Jan. 12, 2020. At the time of the filing, the Debtor was estimated to have assets of less than $50,000 and liabilities of less than $50,000. Judge Brenda K. Martin oversees the case. The Debtor tapped Greeves & Roethler, PLC, as its legal counsel. NORTH VALLEY DERMATOLOGY: Trustee Taps Desmond Nolan as Counsel --------------------------------------------------------------- Kimberly Husted, the Chapter 11 trustee for North Valley Dermatology Ctr, received approval from the U.S. Bankruptcy Court for the Eastern District of California to hire Desmond, Nolan, Livaich and Cunningham as her legal counsel. The firm will assist the trustee in the investigation, marshaling and liquidation of the bankruptcy estate's assets. The firm will be paid at these rates: Gary Livaich $500 William Nolan $400 J. Russell Cunningham $425 Brian Manning $350 Edward Dunn $275 Kristen Ditlevsen Renfro $325 Nicholas Kohlmeyer $275 Benjamin Tagert $175 Desmond and its members have no connections with the Debtor, creditors and any other "party in interest," according to court filings. The firm can be reached through: J. Russell Cunningham, Esq. Nicholas L. Kohlmeyer, Esq. Benjamin C. Tagert, Esq. Desmond, Nolan, Livaich and Cunningham 1830 15th Street Sacramento, California 95811 Telephone: (916) 443-2051 Facsimile: (916) 443-2651 Email: rcunningham@dnlc.net nkohlmeyer@dnlc.net btagert@dnlc.net About North Valley Dermatology Ctr. North Valley Dermatology Ctr. filed a Chapter 11 petition (Bankr. E.D. Cal. Case No. 20-20457) on Jan. 28, 2020. At the time of the filing, the Debtor had estimated assets of between $100,001 and $500,000 and liabilities of between $1 million and $10 million. Judge Christopher M. Klein oversees the case. The Debtor tapped Felderstein Fitzgerald Willoughby Pascuzzi & Rios, LLP as its bankruptcy counsel, and Mannion Lowe & Oksenendler, a Professional Corporation as its special counsel. Kimberly J. Husted was appointed as the Debtor's Chapter 11 trustee. The Trustee is represented by Desmond, Nolan, Livaich and Cunningham. NORTIS INC: Taps Alvarez & Marsal to Provide Valuation Services --------------------------------------------------------------- Nortis, Inc., filed an amended application seeking approval from the U.S. Bankruptcy Court for the Western District of Washington to hire Alvarez & Marsal Valuation Services, LLC to provide valuation services. Alvarez & Marsal will assist the Debtor in determining going-concern and liquidation values of its business, particularly its portfolio of intellectual property. The firm's customary hourly billing rates are: Managing Director $450 - $650 Director/Senior Director $400 - $425 Manger $350 - $375 Associate/Senior Associate $250 - $325 Admin/Staff $175 - $200 Arik Van Zandt, a partner at Alvarez & Marsal, assured the court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Alvarez & Marsal can be reached at: Arik K. Van Zandt Alvarez & Marsal Valuation Services, LLC 1111 Third Avenue, Suite 2450 Seattle, Washington Tel: (206) 664-9000 About Nortis Inc. Nortis, Inc., a company that provides scientific research and development services, filed for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Wash. Case No. 19-13529) on Sept. 25, 2019 in Seattle, Wash. In the petition signed by Thomas Neumann, president and chief executive officer, the Debtor was estimated to have between $1 million and $10 million in both assets and liabilities. The Hon. Christopher M. Alston is the presiding judge. Karr Tuttle Campbell is the Debtor's legal counsel. NOVABAY PHARMACEUTICALS: Reports $9.66 Million Net Loss for 2019 ---------------------------------------------------------------- Novabay Pharmaceuticals, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss and comprehensive loss of $9.66 million on $6.60 million of net total sales for the year ended Dec. 31, 2019, compared to a net loss and comprehensive loss of $6.54 million on $12.51 million of net total sales for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $11.22 million in total assets, $10.25 million in total liabilities, and $973,000 in total stockholders' equity. OUM & CO. LLP, in San Francisco, California, the Company's auditor since 2010, issued a "going concern" qualification in its report dated March 26, 2020 citing that the Company has experienced operating losses for most of its history and expects expenses to exceed revenues in 2020. The Company also has recurring negative cash flows from operations and an accumulated deficit. All of these matters raise substantial doubt about its ability to continue as a going concern. Novabay said, "Based primarily on the funds available at December 31, 2019, the Company believes these resources will be sufficient to fund its operations into the second quarter of 2020. The Company has sustained operating losses for the majority of its corporate history and expects that its 2020 expenses will exceed its 2020 revenues, as the Company continues to re-invest in its Avenova commercialization efforts. The Company expects to continue incurring operating losses and negative cash flows until revenues reach a level sufficient to support ongoing growth and operations. Accordingly, the Company's planned operations raise substantial doubt about its ability to continue as a going concern. The Company's liquidity needs will be largely determined by the success of operations in regard to the commercialization of Avenova. The Company also may consider other plans to fund operations including: (1) out-licensing rights to certain of its products or product candidates, pursuant to which the Company would receive cash milestones or an upfront fee; (2) raising additional capital through debt and equity financings or from other sources; (3) reducing spending on one or more of its sales and marketing programs; and/or (4) restructuring operations to change its overhead structure. The Company may issue securities, including common stock and warrants through private placement transactions or registered public offerings, which would require the filing of a Form S-1 or Form S-3 registration statement with the Securities and Exchange Commission ("SEC"). In the absence of the Company's completion of one or more of such transactions, there will be substantial doubt about the Company's ability to continue as a going concern within one year after the date these financial statements are issued, and the Company will be required to scale back or terminate operations and/or seek protection under applicable bankruptcy laws." A full-text copy of the Form 10-K is available for free at: https://is.gd/ZNDReM About Novabay Heaquartered in , Emeryville, California, NovaBay Pharmaceuticals, Inc. -- http://www.novabay.com/-- is a medical device company predominately focused on eye care. For the past four years, the Company has been focused primarily on commercializing Avenova, an FDA cleared product sold in the United States for cleansing and removing foreign material including microorganisms and debris from skin around the eye, including the eyelid. OCEANEERING INT'L: Moody's Cuts CFR to B1, Alters Outlook to Stable ------------------------------------------------------------------- Moody's Investors Service downgraded Oceaneering International, Inc.'s Corporate Family Rating to B1 from Ba2, Probability of Default Rating to B1-PD from Ba2-PD, and senior unsecured ratings to B1 from Ba2. The SGL-1 Speculative Grade Liquidity Rating was unchanged. The outlook was revised to stable from negative. "The steep drop in global crude prices in 2020 will further delay the recovery in offshore drilling markets keeping Oceaneering's financial leverage elevated over a more prolonged period than we previously expected," said Sajjad Alam, Moody's Senior Analyst. "However, the company's large cash balance and ability to operate with a low level of capital spending will provide financial flexibility in navigating the protracted industry recovery." Issuer: Oceaneering International, Inc. Ratings Downgraded: Corporate Family Rating, Downgraded to B1 from Ba2 Probability of Default Rating, Downgraded to B1-PD from Ba2-PD Senior Unsecured Revolving Credit Facility, Downgraded to B1 (LGD4) from Ba2 (LGD4) Senior Unsecured Notes, Downgraded to B1 (LGD4) from Ba2 (LGD4) Ratings Unchanged: Speculative Grade Liquidity Rating, Unchanged SGL-1 Outlook Actions: Outlook, Changed to Stable from Negative RATINGS RATIONALE The stable outlook reflects Oceaneering's leading market position, strong liquidity and its expectation that the company will continue to manage its capital expenditures within operating cash flow. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The oilfield services sector will be one of the sectors most significantly affected by the shock given its sensitivity to demand and oil prices. Oceaneering will remain vulnerable to the outbreak continuing to spread and oil prices remaining weak. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact on Oceaneering's credit quality of the breadth and severity of the oil demand and supply shocks, and the broad deterioration in credit quality it has triggered. The SGL-1 rating reflects very good liquidity backed by Oceaneering's $374 million cash balance and an undrawn $500 million committed revolving credit facility (due January 25, 2023) as of December 31, 2019 (of which $50 million commitment will expire on October 25, 2021). Oceaneering's substantial cash balance has provided strong credit support since 2015. The company has no debt maturities until 2024, when the $500 million 4.65% notes are due. Oceaneering should be able to comfortably meet the 55% debt to capitalization financial covenant in its revolving credit agreement through 2021. Oceaneering's B1 CFR reflects its elevated financial leverage, weak margins, limited free cash flow prospects through 2021, as well as the prospects of a delayed recovery for offshore focused OFS industry. While the macro backdrop remains challenged, Moody's expects the company to generate breakeven to slightly positive free cash flow in 2020. Oceaneering's reduced level of capital expenditures and management's sharp focus on managing the business within operating cash flow will support liquidity. Oceaneering's core strengths remain its leading market position in the niche offshore ROV segment, strong liquidity, and a diversified and strong customer base comprised of mostly large blue-chip oil and gas companies. Due to the preponderance of a single class of debt in the capital structure, Oceaneering's notes and credit facility are rated B1, the same level as the Corporate Family Rating. The notes and the credit facility rank pari-passu and do not have guarantees from Oceaneering's operating subsidiaries. The principal methodology used in these ratings was Global Oilfield Services Industry Rating Methodology. Oceaneering International, Inc. is a Houston, Texas based globally diversified OFS company and a leading provider of remotely operated vehicles to the offshore oil and gas industry. Factors that would lead to an upgrade or downgrade of the ratings: Oceaneering's ratings could be downgraded if the company produces significant negative free cash flow, materially erodes its cash cushion, or is unable to sustain the Debt/EBITDA ratio below 6x. While an upgrade is unlikely through 2020, if the company could reduce debt, sustain Debt/EBITDA below 4x, and generate free cash flow consistently in a stable to improving industry environment, a higher rating could be considered. PES HOLDINGS: Court Rules Priority Over Insurance Policies ---------------------------------------------------------- In the case captioned PES HOLDINGS, LLC, et al., and CORTLAND CAPITAL MARKET SERVICES, LLC, Plaintiffs and Counterclaim Defendants, v. OFFICIAL COMMITTEE OF UNSECURED CREDITORS OF PES, INC., Inventor-Defendant and Counterclaim and Cross-Claim Plaintiff and ICBC STANDARD BANK PLC, Defendant and Cross-Claim Defendant, Adv. Pro. No. 19-50282 (KG) (Bankr. D. Del.), Bankruptcy Judge Kevin Gross addresses a complex dispute over the apportionment of business interruption (BI) insurance proceeds and property damage insurance proceeds following a catastrophic explosion at the Debtors' oil refinery in Philadelphia, Pennsylvania. The battle for the proceeds is between and among (1) Debtors and their lender, Cortland Capital Market Services, LLC who are plaintiffs and counterclaim defendants, (2) ICBC Standard Bank, PLC, which, pursuant to an Intermediation Facility provided supplies and purchased refined product (oil and gas) from Debtors and is a defendant, counterclaim plaintiff, and cross-claim defendant, and (3) the Official Committee of Unsecured Creditors, which is an intervenor defendant and counterclaim and cross-claim plaintiff. The Plaintiffs moved for judgment on the pleadings, which the Court is treating as a motion for summary judgment with Plaintiffs' consent; and ICBCS and the Committee have moved for summary judgment. Te Court rules that (1) Plaintiffs' motion is denied in part (Cortland does not have priority over the BI Policy) and granted in part (Cortland has priority over the PD Policy except as it relates to SOA Separate Assets and Collateral and SOA Priority Collateral); (2) ICBCS's motion is granted (ICBCS does have priority over the PD Policy as it relates to SOA Separate Assets and Collateral and SOA Priority Collateral and ICBCS has priority over the BI Policy); and (3) the Committee's motion is denied. Judge Gross considers (i) the nature of business interruption insurance, (ii) whether Cortland and/or ICBCS have perfected secured interests in the BI Proceeds and the PD Proceeds, (iii) who, as between Cortland and ICBCS, has priority to receive the BI Proceeds and the PD Proceeds, and (iv) whether the Term Loan Agent's and/or ICBCS's interests can be avoided. The Court finds that like the Term Loan Agent, ICBCS has a clear perfected security interest in the BI Policy and Proceeds. Like the Term Loan Security Agreement, the ICBCS Security Agreement gave ICBCS a blanket lien on all of the Debtors' assets. The BI Policy has an endorsement which names ICBCS as a loss payee/mortgagee, and the BI Policy also names ICBCS as an additional insured. ICBCS therefore held a perfected security interest before the Debtors filed the bankruptcy case. As such, ICBCS's interest includes the Proceeds of the BI Policy which means that ICBCS's security interests in the BI Policy and BI Proceeds are valid and are also safeguarded by Bankruptcy Code Section 552(b). Judge Gross notes it is settled law that insurance proceeds that are collected post-petition because of loss or damage to collateral that is covered by a pre-petition perfected security interest are also subject to a creditor's perfected security interest under Section 552(b). The Court also agrees with ICBCS that the BI Proceeds are not property of the estate and cannot be recovered for unsecured creditors. The proceeds cannot be reclaimed. Instead, the proceeds are held by the Debtor in trust for the loss payee insured. ICBCS claims that it has a first priority or exclusive security interest in any PD Proceeds paid on account of Inventory or SOA Separate Assets and Collateral, respectively. The Term Loan Agent also claims priority to the property insurance proceeds, i.e. PD Proceeds. The Term Loan Agent argues that ICBCS has priority only on insurance proceeds related to certain hydrocarbons and their refined products. The property damage sustained at the refinery consists by-and-large of damage to the refining facility as opposed to damage to hydrocarbons or refined products. The Court finds that ICBCS has priority on the PD Proceeds related to SOA Separate Assets and Collateral and SOA Priority Collateral, which includes Inventory. The Term Loan Agent has priority on the PD Proceeds related to all other Common Collateral, which includes all Fixtures, Equipment, and pursuant to the Mortgages, Real Estate. Further, the damage sustained in the Girard Point Incident was largely to the refining facility and not to hydrocarbons or refined products. ICBCS has priority with respect to the hydrocarbons and refined products. A copy of the Court's Opinion dated Feb. 28, 2020 is available at https://bit.ly/2VUjMS3 from Leagle.com. PES Holdings, LLC, et al. & Cortland Capital Market Services, LLC, Plaintiffs, represented by Laura Davis Jones -- ljones@pszjlaw.com -- Pachulski Stang Ziehl & Jones LLP, Peter J. Keane -- pkeane@pszjlaw.com -- Pachulski Stang Young & Jones LLP & James E. O'Neill -- joneill@pszjlaw.com -- Pachulski Stang Ziehl & Jones LLP. ICBC Standard Bank PLC, Defendant, represented by William Pierce Bowden -- WBowden@ashbygeddes.com -- Ashby & Geddes & David Cook -- dcook@ashbygeddes.com -- Ashby & Geddes. PES Holdings, LLC, et al., Counter-Defendant, represented by Laura Davis Jones, Pachulski Stang Ziehl & Jones LLP. Official Committee of Unsecured Creditors, Cross-Claimant, represented by Jonathan M. Stemerman -- JXS@elliottgreenleaf.com -- Elliott Greenleaf, PC. ICBC Standard Bank PLC, Cross Defendant, represented by David Cook, Ashby & Geddes. ICBC Standard Bank PLC, Counter-Claimant, represented by David Cook, Ashby & Geddes. About PES Holdings Headquartered in Philadelphia, Pennsylvania, PES Holdings LLC and its subsidiaries are owners and operators of oil refining complex and have been continuously operating in some form for over 150 years. PES Energy Inc. is the indirect parent company of Philadelphia Energy Solutions Refining and Marketing LLC (PESRM). PESRM owns and operates the Point Breeze and Girard Point oil refineries located on an integrated, 1,300-acre refining complex in Philadelphia. PES Holdings, LLC, and seven subsidiaries, including PES Energy, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 19-11626) on July 21, 2019. PSE Holdings estimated $1 billion to $10 billion in assets and the same range of liabilities as of the bankruptcy filing. The Debtors tapped Kirkland & Ellis LLP as general bankruptcy counsel; Pachulski Stang Ziehl & Jones LLP as local bankruptcy counsel; PJT Partners LP as financial advisor; and Alvarez & Marsal North America, LLC, as restructuring advisor. Omni Management Group, Inc., is the notice and claims agent. The Company's proposed DIP financing lenders are represented by Davis Polk & Wardwell LLP and Houlihan Lokey Capital, Inc. PESTOVA HOLDINGS: Chapter 7 Conversion or Case Trustee Sought ------------------------------------------------------------- Henry G. Hobbs Jr., the Acting United States Trustee for Region 7, asks the U.S. Bankruptcy Court for the Southern District of Texas for entry of an order converting the chapter 11 case of Pestova Holdings, LLC to a chapter 7 proceeding, or in the alternative, to appoint a chapter 11 trustee for the Debtor. Pestova Holdings, LLC is a small business debtor whose principal place of business is located at 7202 Martin Luther King Jr. Boulevard, the MLK Property, Houston, Texas, with reported assets of $2,274,923.72 and liabilities of $1,213,235.87. It owns 17 acres of undeveloped land located at 10444 Rosecroft Drive, Houston, Texas, valued at $551,695.00. Both the Rosecroft Property and the MLK Property do not generate any cashflow and only five of 37 real property promissory notes entered into by the Debtor are currently performing. The Debtor filed for chapter 11 bankruptcy relief to prevent a foreclosure sale of four vacant lots located in the South Acres Subdivision, Harris County, Texas, the South Acres Property by mortgagees Edmond Thomas and Valerie Thomas. On January 13, 2020, the Debtor filed a Motion to Dismiss the Chapter 11 bankruptcy proceeding, indicating it would no longer oppose the foreclosure of the mortgage lien for the best interests of its creditors, On January 14, 2020, the Debtor filed a notice to withdraw its motion to sell the Rosecroft Property for $600,000. The proceeds of that sale would have been used to pay the mortgage of $350,000 and property taxes of $13,359.76, and the remainder, or $236,640.24, would be paid to the Debtor's secured, priority, and unsecured creditors. However, during the meeting of creditors, Luis Escobedo, the president and a member of the Debtor, testified that the proposed buyer was Kevin Juarez Investments, LLC in which Escobero formerly held a 50% ownership interest, but that he had transferred the interest to Edson Juarez about six months prior to bankruptcy for an undisclosed sum. According to the U.S. Trustee, there is a cause exists to convert this case to chapter 7 or to direct appointment of a chapter 11 trustee for failure timely to provide information. The Debtor has failed to provide (i) evidence of commercial general liability insurance on the MLK Property, (ii) an accounting for all monies collected by the Debtor pursuant to the real property promissory notes, (iii) a copy of the Debtor's 2018 federal income tax return, and (iv) a completed IDI report. According to the U.S. Trustee, Mr. Escobedo could not be trusted due to fraud and dishonesty because he: (a) sold the same land to two or three different individuals; (b) failed to provide an accounting for the payments made by these individuals; and (c) failed to live up to his promises to provide necessary services. About Pestova Holdings Pestova Holdings filed a voluntary Chapter 11 petition (Bankr. S.D. Tex. Case No. 19-36737) on Dec. 3, 2019, and is represented by Jesse Aguinaga, Esq., Attorney at Law P.C. The Debtor listed under $1 million in both assets and liabilities. PG&E CORP: Exclusive Solicitation Period Extended Until June 30 --------------------------------------------------------------- Judge Dennis Montali of the U.S. Bankruptcy Court for the Northern District of California extended to June 30 the exclusive period during which PG&E Corporation and its affiliate can solicit acceptances for their Chapter 11 plan. About PG&E Corporation PG&E Corporation (NYSE: PCG) -- http://www.pgecorp.com/-- is a Fortune 200 energy-based holding company, headquartered in San Francisco. It is the parent company of Pacific Gas and Electric Company, an energy company that serves 16 million Californians across a 70,000-square-mile service area in Northern and Central California. As of Sept. 30, 2018, the Debtors, on a consolidated basis, had reported $71.4 billion in assets on a book value basis and $51.7 billion in liabilities on a book value basis. PG&E Corp. and Pacific Gas employ approximately 24,000 regular employees, approximately 20 of whom are employed by PG&E Corp. Of Pacific Gas' regular employees, approximately 15,000 are covered by collective bargaining agreements with local chapters of three labor unions: (i) the International Brotherhood of Electrical Workers; (ii) the Engineers and Scientists of California; and (iii) the Service Employees International Union. On Jan. 29, 2019, PG&E Corp. and its primary operating subsidiary, Pacific Gas and Electric Company, filed voluntary Chapter 11 petitions (Bankr. N.D. Cal. Lead Case No. 19-30088). PG&E Corporation and its regulated utility subsidiary, Pacific Gas and Electric Company, said they are facing extraordinary challenges relating to a series of catastrophic wildfires that occurred in Northern California in 2017 and 2018. The utility said it faces an estimated $30 billion in potential liability damages from California's deadliest wildfires of 2017 and 2018. Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP are serving as PG&E's legal counsel, Lazard is serving as its investment banker and AlixPartners, LLP is serving as the restructuring advisor to PG&E. Prime Clerk LLC is the claims and noticing agent. In order to help support the Company through the reorganization process, PG&E has appointed James A. Mesterharm, a managing director at AlixPartners, LLP, and an authorized representative of AP Services, LLC, to serve as Chief Restructuring Officer. In addition, PG&E appointed John Boken also a Managing Director at AlixPartners and an authorized representative of APS, to serve as Deputy Chief Restructuring Officer. Mr. Mesterharm, Mr. Boken and their colleagues at AlixPartners will continue to assist PG&E with the reorganization process and related activities. Morrison & Foerster LLP, as special regulatory counsel. Munger Tolles & Olson LLP, as special counsel. The Office of the U.S. Trustee appointed an official committee of creditors on Feb. 12, 2019. The Committee retained Milbank LLP as counsel; FTI Consulting, Inc., as financial advisor; Centerview Partners LLC as investment banker; and Epiq Corporate Restructuring, LLC as claims and noticing agent. On Feb. 15, 2019, the U.S. trustee appointed an official committee of tort claimants. The tort claimants' committee is represented by Baker & Hostetler LLP. PG&E CORP: Further Fine-Tunes Plan & Disclosure Statement --------------------------------------------------------- Debtors PG&E Corporation and Pacific Gas and Electric Company, and certain funds and accounts managed or advised by Abrams Capital Management, LP and certain funds and accounts managed or advised by Knighthead Capital Management, LLP (the Shareholder Proponents) further modified their proposed bankruptcy-exit plan, filing the a Joint Chapter 11 Plan of Reorganization and a Disclosure Statement on March 16, 2020. Under the Plan, aggregate consideration of $13.5 billion will be transferred to a trust to satisfy Fire Victim Claims (the "Fire Victim Trust"): 1. $5.4 billion in cash on the effective date of the Plan; 2. An additional $1.35 billion in Cash, consisting of (i) $650 million to be paid in cash on or before Jan. 15, 2021 pursuant to a Tax Benefits Payment, and (ii) $700 million to be paid in Cash on or before Jan. 15, 2022 pursuant to a Tax Benefits Payment Agreement; 3. $6.75 billion in common stock of Reorganized PG&E Corp. (using an equity valued using a multiple equal to 14.9 multiplied by the Normalized Estimated Net Income as of a date to be agreed upon among the parties to the Tort Claimants RSA), representing not less than 20.9% of the outstanding common stock of Reorganized PG&E Corp. as of the Effective Date. The $6.75 billion value of the Common Stock of Reorganized PG&E Corp. is based on a formula set forth in the tort claimants RSA and incorporated in the Plan. The $6.75 billion value does not necessarily reflect the actual value of the stock to be held by the fire victim trust on the effective date and thereafter. The actual value of the stock on the effective date and thereafter could be greater or less than than $6.75 billion based on the future trading value of the common stock of Reorganized PG&E CORP.; 4. The assignment to the Fire Victim Trust of certain claims that the Fire Victim Trust may pursue for the benefit of holders of Fire Victim Claims; and 5. The assignment of rights under the 2015 Insurance Policies to resolve any Claims related to Fires in those policy years, other than the rights of the Debtors to be reimbursed under the 2015 Insurance Policies for claims submitted to and paid by the Debtors prior to the Petition Date. The Parties believe that confirmation and implementation of the Plan is the fastest way for fire victims and other claimants to receive payments on their claims, and that if the Plan is not approved those payments will be significantly delayed and fire victims and other claimants may receive significantly less than what they would receive under the Plan. Under the Plan, aggregate consideration of $13.5 billion will be transferred to a trust to satisfy Fire Victim Claims. Pursuant to the Plan, all Allowed Fire Victim Claims will be paid from the assets that will be transferred to the Fire Victim Trust. All Fire Victim Claims will be resolved and satisfied by the Fire Victim Trust pursuant to claims resolution procedures to be adopted by the Fire Victim Trust. The Fire Victim Trust will be funded with cash and stock of reorganized PG&E Corp. with an aggregate value of approximately $13.5 billion. The Fire Victim Trust will hold and sell the stock, and nothing in the Plan or the Fire Victim Trust Agreement requires stock to be distributed to individual Fire Victims. The Fire Victim Trust will also be assigned certain rights and causes of action that the Fire Victim Trust will have the authority to pursue for the benefit of holders of Fire Victim Claims. The aggregate consideration of $13.5 billion to be contributed to the Fire Victim Trust was determined by a settlement among the Debtors, the Shareholder Proponents, the Official Committee of Tort Claimants that has a fiduciary duty to represent the interests of all holders of Fire Victim Claims, other than the interests of Governmental Units in the Chapter 11 Cases, and the law firms that represent Fire Victims holding over 70% of the in excess of 70,000 fire claims that have been filed. The sole source of recovery for holders of Fire Victim Claims is the Fire Victim Trust. Each holder of an Allowed General Unsecured Claim to be paid in full on the Effective Date. The Allowed amount of any General Unsecured Claim shall include all interest accrued from the Petition Date through the Effective Date at the Federal Judgment Rate. The class is unimpaired. Any Interests held in PG&E Corp. immediately prior to the Effective Date, other than HoldCo Common Interests. The interests are reinstated on the Effective Date. In order to finance the transactions contemplated by the Plan, the Debtors expect to raise $9 billion through one or more issuances of new PG&E Corp. common stock. The equity issuances could include one or more of the following structures: public or private offerings in the equity capital markets, a rights offering to holders of PG&E Corp.’s common stock or drawing under the Equity Backstop Commitment Letters between PG&E Corp. and the investors party. In addition to the equity financing, the Plan contemplates incurrence of $4.75 billion of new PG&E Corp. debt and $33.35 billion of Utility debt. The $33.35 billion of Utility debt is expected to consist of (a) $9.575 billion of reinstated prepetition senior notes, (b) $11.85 billion of new senior notes to be issued to holders of prepetition senior note claims, (c) $5.925 billion of new senior notes and (d) $6.0 billion of new short-term debt expected to be refinanced after the Effective Date. A full-text copy of the Disclosure Statement dated March 17, 2020, is available at https://tinyurl.com/skvamkr from PacerMonitor at no charge. The Debtors are represented by: Stephen Karotkin Ray C. Schrock, P.C. Jessica Liou Matthew Goren WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, NY 10153-0119 Tel: 212 310 8000 Fax: 212 310 8007 E-mail: stephen.karotkin@weil.com ray.schrock@weil.com jessica.liou@weil.com matthew.goren@weil.com - and - Tobias S. Keller Jane Kim KELLER & BENVENUTTI LLP 650 California Street, Suite 1900 San Francisco, CA 94108 Tel: 415 496 6723 Fax: 650 636 9251 E-mail: tkeller@kellerbenvenutti.com jkim@kellerbenvenutti.com Attorneys for Shareholder Proponents: JONES DAY Bruce S. Bennett Joshua M. Mester James O. Johnston E-mail: bbennett@jonesday.com E-mail: jmester@jonesday.com E-mail: jjohnston@jonesday.com 555 South Flower Street Fiftieth Floor Los Angeles, CA 90071-2300 Tel: 213 489 3939 Fax: 213 243 2539 About PG&E Corporation PG&E Corporation (NYSE: PCG) -- http://www.pgecorp.com/-- is a Fortune 200 energy-based holding company, headquartered in San Francisco. It is the parent company of Pacific Gas and Electric Company, an energy company that serves 16 million Californians across a 70,000-square-mile service area in Northern and Central California. As of Sept. 30, 2018, the Debtors, on a consolidated basis, had reported $71.4 billion in assets on a book value basis and $51.7 billion in liabilities on a book value basis. PG&E Corp. and Pacific Gas employ approximately 24,000 regular employees, approximately 20 of whom are employed by PG&E Corp. Of Pacific Gas' regular employees, approximately 15,000 are covered by collective bargaining agreements with local chapters of three labor unions: (i) the International Brotherhood of Electrical Workers; (ii) the Engineers and Scientists of California; and (iii) the Service Employees International Union. On Jan. 29, 2019, PG&E Corp. and its primary operating subsidiary, Pacific Gas and Electric Company, filed voluntary Chapter 11 petitions (Bankr. N.D. Cal. Lead Case No. 19-30088). PG&E Corporation and its regulated utility subsidiary, Pacific Gas and Electric Company, said they are facing extraordinary challenges relating to a series of catastrophic wildfires that occurred in Northern California in 2017 and 2018. The utility said it faces an estimated $30 billion in potential liability damages from California's deadliest wildfires of 2017 and 2018. Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP are serving as PG&E's legal counsel, Lazard is serving as its investment banker and AlixPartners, LLP is serving as the restructuring advisor to PG&E. Prime Clerk LLC is the claims and noticing agent. In order to help support the Company through the reorganization process, PG&E has appointed James A. Mesterharm, a managing director at AlixPartners, LLP, and an authorized representative of AP Services, LLC, to serve as Chief Restructuring Officer. In addition, PG&E appointed John Boken also a Managing Director at AlixPartners and an authorized representative of APS, to serve as Deputy Chief Restructuring Officer. Mr. Mesterharm, Mr. Boken and their colleagues at AlixPartners will continue to assist PG&E with the reorganization process and related activities. Morrison & Foerster LLP, as special regulatory counsel. Munger Tolles & Olson LLP, as special counsel. The Office of the U.S. Trustee appointed an official committee of creditors on Feb. 12, 2019. The Committee retained Milbank LLP as counsel; FTI Consulting, Inc., as financial advisor; Centerview Partners LLC as investment banker; and Epiq Corporate Restructuring, LLC as claims and noticing agent. On Feb. 15, 2019, the U.S. trustee appointed an official committee of tort claimants. The tort claimants' committee is represented by Baker & Hostetler LLP. PHIO PHARMACEUTICALS: Incurs $8.91 Million Net Loss in 2019 ----------------------------------------------------------- Phio Pharmaceuticals Corp. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $8.91 million on $21,000 of revenues for the year ended Dec. 31, 2019, compared to a net loss of $7.36 million on $138,000 of revenues for the year ended Dec. 31, 2018. The increase in net loss was primarily attributable to an increase in operating expenses. As of Dec. 31, 2019, the Company had $8.04 million in total assets, $2.29 million in total liabilities, and $5.75 million in total stockholders' equity. "Our progress in 2019, along with the bolstering of our balance sheet, now positions us to further unlock the value of our immuno-oncology programs based on our self-delivering RNAi (INTASYL) therapeutic platform," said Dr. Gerrit Dispersyn, president and CEO of Phio. "With new data from animal studies becoming available, we look forward to continuing our R&D momentum in 2020, including the transition towards the clinical development stage of our lead candidate PH-762. We also continue to leverage our RNAi platform to establish research collaborations with leading companies and academic institutions. We recently announced a new collaboration and option agreement with Medigene AG, further building on our previously announced research collaboration with the Helmholtz Zentrum Munchen to design and develop novel candidates in adoptive cell therapy." At Dec. 31, 2019, the Company had cash of $6.9 million as compared with $14.9 million at Dec. 31, 2018. This does not include the $9.74 million in gross proceeds the Company raised through two equity offerings completed in February 2020. The Company expects its cash will be sufficient to fund currently planned operations for at least the next 12 months. Research and development expenses were approximately $4.3 million for the years ended Dec. 31, 2019 and 2018, respectively. Research and development expenses were consistent year over year primarily as a result of a reduction in the Company's legacy clinical trial-related expenses which ended in 2018; offset by increased use of third-party CROs to support preclinical immuno-oncology research efforts in 2019. General and administrative expenses were $4.7 million for the year ended Dec. 31, 2019, compared to $3.2 million for the year ended Dec. 31, 2018. The increase was primarily due to legal professional fees, recruiting fees related to employee hiring activities and increased proxy-related fees as a result of the Company's annual and special stockholder meetings held in 2019. Phio said, "We expect to continue to incur significant research and development expenses, which may make it difficult for us to attain profitability, and may lead to uncertainty as to our ability to continue as a going concern. "We expend substantial funds to develop our technologies, and additional substantial funds will be required for further research and development, including preclinical testing and clinical trials of any product candidates, and to manufacture and market any products that are approved for commercial sale. Because the successful development of our products is uncertain, we are unable to precisely estimate the actual funds we will require to develop and potentially commercialize them. In addition, we may not be able to generate enough revenue, even if we are able to commercialize any of our product candidates, to become profitable. "If we are unable to achieve or sustain profitability or to secure additional financing, we may not be able to meet our obligations as they come due, raising substantial doubts as to our ability to continue as a going concern. Any such inability to continue as a going concern may result in our common stockholders losing their entire investment. There is no guarantee that we will become profitable or secure additional financing. Our financial statements do not include any adjustments to, or classification of, recorded asset amounts and classification of liabilities that might be necessary if we were unable to continue as a going concern. Changes in our operating plans, our existing and anticipated working capital needs, the acceleration or modification of our expansion plans, increased expenses, potential acquisitions or other events will all affect our ability to continue as a going concern." A full-text copy of the Form 10-K is available for free at: https://is.gd/8Jkr1c About Phio Pharmaceuticals Phio Pharmaceuticals Corp. (Nasdaq: PHIO) -- http://www.phiopharma.com/-- is a biotechnology company developing the next generation of immuno-oncology therapeutics based on its self-delivering RNAi (INTASYL) therapeutic platform. The Company's efforts are focused on silencing tumor-induced suppression of the immune system through its proprietary INTASYL platform with utility in immune cells and/or the tumor micro-environment. The Company's goal is to develop powerful INTASYL therapeutic compounds that can weaponize immune effector cells to overcome tumor immune escape, thereby providing patients a powerful new treatment option that goes beyond current treatment modalities. PHUNWARE INC: Widens Net Loss to $12.9 Million in 2019 ------------------------------------------------------ Phunware, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $12.87 million on $19.15 million of net revenues for the year ended Dec. 31, 2019, compared to a net loss of $9.80 million on $30.88 million of net revenues for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $29.05 million in total assets, $25.02 million in total liabilities, and $4.03 million in total stockholders' equity. Marcum LLP, in Houston, TX, the Company's auditor since 2017, issued a "going concern" qualification in its report dated March 30, 2020 citing that the Company has a significant working capital deficiency, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The Company utilized $6.2 million of cash from operating activities during 2019 primarily resulting from a net loss of $12.9 million, as adjusted for non-cash charges related to stock-based compensation of $1.8 million, depreciation and amortization of $0.3 million and allowance for doubtful receivables of $0.1 million. In addition, during 2019 certain changes in the Company's operating assets and liabilities resulted in cash increases (decreases) as follows: $1.1 million from a increase in accrued expenses mainly related to accrued compensation, $0.7 million from an increase in accounts payable related to increase in payables for legal fees, $1.8 million from a decrease in accounts receivable mainly attributable to the conclusion of the Company's statement of work with Fox, $0.6 million from deferred revenue and $0.2 million from prepaid expenses. Investing activities during 2019 primarily consisted of proceeds received from the sale of digital currencies. The Company's financing activities during 2019 consist primarily of the proceeds from warrant exercises offset by redemptions of Series A convertible preferred stock. The Company acquired $0.1 million of cash from financing activities during 2019, primarily as follows: $6.1 million provided by warrant exercises; $1.1 million from its debt financings, which includes $0.2 million received from an affiliated associated with its chief executive officer; $0.3 million from proceeds of exercises of options to purchase its common stock; and $0.2 million from proceeds received from PhunCoin deposits. These were offset by ($6.2) million in payments for the redemption of Series A convertible preferred stock and ($1.4) million in net payments on its factoring financing arrangement. A full-text copy of the Form 10-K is available for free at: https://is.gd/jfqjgK About Phunware Headquartered in Austin, Texas, Phunware, Inc. -- http://www.phunware.com-- is a Multiscreen-as-a-Service (MaaS) company, a fully integrated enterprise cloud platform for mobile that provides companies the products, solutions, data and services necessary to engage, manage and monetize their mobile application portfolios and audiences globally at scale. PIONEER HEALTH: Trustee Bid to Enforce Purchase Deal Okayed ----------------------------------------------------------- In the bankruptcy case captioned IN RE: PIONEER HEALTH SERVICES, INC. ET AL., Chapter 11, Debtors, Case No. 16-01119-NPO, Jointly Administered (Bankr. S.D. Miss.), Bankruptcy Judge Neil P. Olack issued an order granting the Liquidating Trustee's motion to enforce (i) the Asset Purchase Agreement Between Pioneer Health Services, Inc., Medicomp, Inc., and EnduraCare Acute Care Services, LLC; and (ii) confirming the Joint Liquidating Chapter 11 Plan as amended and modified. PHS filed on its own behalf and on behalf of its subsidiaries, Medicomp Pioneer Health Services of Patrick County, Inc.; Pioneer Health Services of Newton County, LLC; Pioneer Health Services of Stokes County, Inc.; Pioneer Health Services of Choctaw County, LLC; Pioneer Health Services of Oneida, LLC; Pioneer Health Services of Monroe County, Inc.; and Pioneer Health Services of Early County, voluntary petitions for relief under chapter 11 of the Bankruptcy Code in early 2016. The goal of PHS in filing these chapter 11 bankruptcy cases was to liquidate its assets and the assets of its subsidiaries and to cease all business operations. The Court ordered that these affiliated cases be consolidated into the Lead Bankruptcy Case of PHS and jointly administered for procedural purposes only. When it commenced bankruptcy, Medicomp provided physical therapy and other rehabilitation services at 26 facilities, most of which were in Mississippi. The remaining subsidiaries of PHS operated "critical access hospitals" in Mississippi and in four other states. PHS provided management, billing, and collection services to Medicomp and its other subsidiaries. The parties' dispute arises out of the Court-approved sale of substantially all of Medicomp's assets to EnduraCare. The resolution of this dispute requires the Court to determine which entity owns Medicomp's historical patient records. In disputes regarding the sale of business assets, the purchaser usually asserts that the sale includes more assets, not less. EnduraCare, however, asserts that the sale of Medicomp includes less assets, not more. The obligations and potential liability imposed under non-bankruptcy law on the owner of patient records explains EnduraCare's unusual stance. Healthcare businesses generate and maintain hundreds of thousands of medical records. Such records are necessary to provide ongoing medical care to patients, to comply with healthcare regulations, and to collect and receive payment for medical services. A myriad of federal and state laws requires healthcare facilities to keep those records both private and available to the patient or an insurance provider for long periods. Healthcare businesses in bankruptcy may not have the financial and human resources to store and/or destroy patients records pursuant to applicable non-bankruptcy law. Congress attempted to address this problem by creating an alternative mechanism under 11 U.S.C. section 351 for the disposal of patient records in a short period while also protecting the privacy of patients. Nevertheless, during the pendency of the Debtors' liquidating asset cases, the handling of patient records has been a persistent issue. According to the Liquidating Trustee, the EnduraCare APA is clear and unambiguous that EnduraCare purchased "all Patient Records" from Medicomp, including its historical patient records. The Liquidating Trustee points to subsection (j) of section 2.1 of the EnduraCare APA, which defines "Purchased Assets" as including "all Patient Records." Even if the EnduraCare APA is ambiguous, the Liquidating Trustee contends that the doctrine of collateral estoppel precludes EnduraCare from relitigating the issue in light of the Court's adjudication in the Confirmation Order that it would be unnecessary for Medicomp to avail itself of the provisions of 11 U.S.C. section 351 and Rule 6011. For its contention that it did not purchase any historical patient records, EnduraCare relies on a different subsection of section 2.1 and the definition of "Excluded Assets" in section 2.2. EnduraCare asserts that pursuant to subsection (f) of section 2.1, it did not purchase "any Documents primarily related to or required [by the Debtors] to realize the benefits of any Excluded Assets," including accounts receivable. Also, subsection (h) of section 2.2 defines "Excluded Assets" as any other records that the Debtors determined to be "necessary or advisable" to retain. EnduraCare reasons that Medicomp needed to retain ownership of its historical patient records to collect its accounts receivable. EnduraCare's position, as summarized by the Liquidating Trustee, is that "because the pre-closing accounts receivable were Excluded Assets under the [EnduraCare] APA, then the pre-closing Patient Records were also automatically excluded because such records were necessary for Medicomp's collection of pre-closing receivables, rendering those records an Excluded Asset." According to the Court, the dispute hinges on a proper interpretation of section 2.1 of the EnduraCare APA, which identifies the categories of assets purchased by EnduraCare in 14 paragraphs separated by semi-colons. Subsection (f) in section 2.1 identifies as a Purchased Asset any documents that generally relate to the services provided by the business. Included among these Documents are advertising and promotional materials as well as the personnel files of "Transferred Employees." Subsection (f) excludes documents "primarily related to or required to realize the benefits of any Excluded Assets." Subsection (j), which appears in a separate paragraph, identifies as a Purchased Asset "all Patient Records." No other subsection in section 2.1 refers to patient records. The list of Purchased Assets in section 2.1 treats Patient Records separately from all other categories of assets. This separate placement indicates that the parties did not intend the language in subsection (f) excluding documents "primarily related to or required to realize the benefits of any Excluded Assets" to apply to Patient Records in subsection (j). If EnduraCare had desired that Medicomp retain historical patient records, then it would have been a simple matter to add language to section 2.1(j) limiting the definition of Patient Records. The Court finds that section 2.1(j) of the EnduraCare APA is unequivocal in its reference to "all Patient Records" as a specific category of Purchased Assets and thus concludes that section 2.1(j) unambiguously transfers all patient records to EnduraCare, including historical patient records. This reading of subsections (f) and (j) is consistent with the structure, punctuation, and language of section 2.1. In sum, the Court holds that EnduraCare's refusal to assume responsibility for the historical patient records is its second attempt in the Lead Bankruptcy Case to avoid its financial obligations under the EnduraCare APA. EnduraCare refused to pay the final installment of the purchase price and now attempts to engraft more favorable terms into the EnduraCare APA. The Court finds that the EnduraCare APA unambiguously conveys all patient records, including historical patient records, to EnduraCare. Accordingly, the Court finds that the Trustee Motion to Enforce should be granted. A copy of the Court's Memorandum Opinion and Order dated Feb. 28, 2020 is available at https://bit.ly/38yClxS from Leagle.com. Pioneer Health Services, Inc., Debtor In Possession, represented by Craig M. Geno, Law Offices of Craig M. Geno, PLLC & Jarret P. Nichols, Law Offices of Craig M. Geno, PLLC. Marshall Glade, the Liquidating Trustee, Trustee, represented by James A. McCullough, II -- jmccullough@brunini.com -- Brunini, Grantham, Grower & Hewes, PLLC. United States Trustee, U.S. Trustee, represented by Ronald H. McAlpin, Margaret O. Middleton, US Trustee's Office & Christopher J. Steiskal, Sr. , United States Trustee. OFFICIAL UNSECURED CREDITOR COMMITTEE, Creditor Committee, represented by Michael F. Holbein -- michael.holbein@agg.com -- Arnall Golden Gregory LLP, Sean C. Kulka -- sean.kulka@agg.com -- Arnall Golden Gregory LLP, Darryl Scott Laddin, Arnall Golden Gregory LLP & James A. McCullough, II , Brunini, Grantham, Grower & Hewes, PLLC. About Pioneer Health Services Pioneer Health Services, Inc., provides healthcare services to rural communities, and own and manage rural critical access hospitals. Pioneer Health Services and its debtor-affiliates, including Medicomp Inc., filed Chapter 11 bankruptcy petitions (Bankr. S.D. Miss. Lead Case No. 16-01119) on March 30, 2016. Pioneer Health Services of Early County, LLC, commenced a Chapter 11 case on April 8, 2016. The cases are administratively consolidated. Joseph S. McNulty, III, its president, signed the petitions. Pioneer Health Services estimated $10 million to $50 million in assets and liabilities. Judge Hon. Neil P. Olack presides over the Debtors' cases. The Law Offices of Craig M. Geno PLLC serves as the Debtors' counsel. Mintz Levin Cohn Ferris Glovsky and Popeo, P.C., is acting as special counsel to the Debtor. Henry Hobbs, Jr., acting U.S. trustee for Region 5, appointed an official committee of unsecured creditors on April 19, 2017. The Committee retained Arnall Golden Gregory LLP as counsel, and GlassRatner Advisory & Capital Group LLC as financial advisor. PRESSURE BIOSCIENCES: Delays Filing of 2019 Annual Report --------------------------------------------------------- Pressure Biosciences, Inc., was unable, without unreasonable effort or expense, to file its Annual Report on Form 10-K for the year ended Dec. 31, 2019 by the March 30, 2020 filing date applicable to smaller reporting companies due to a delay experienced by the Company in completing its financial statements and other disclosures in the Annual Report. As a result, the Company is still in the process of compiling required information to complete the Annual Report and its independent registered public accounting firm requires additional time to complete its review of the financial statements for the period ended Dec. 31, 2019 to be incorporated in the Annual Report. The Company anticipates that it will file the Annual Report no later than the fifteenth calendar day following the prescribed filing date. About Pressure Biosciences South Easton, Massachusetts-based Pressure BioSciences -- http://www.pressurebiosciences.com/-- is engaged in the development and sale of innovative, broadly enabling, pressure-based solutions for the worldwide life sciences industry. The Company's products are based on the unique properties of both constant (i.e., static) and alternating (i.e., pressure cycling technology) hydrostatic pressure. PCT is a patented enabling technology platform that uses alternating cycles of hydrostatic pressure between ambient and ultra-high levels to safely and reproducibly control bio-molecular interactions. Pressure Biosciences reported a net loss attributable to common shareholders of $23.47 million for the year ended Dec. 31, 2018, compared to a net loss attributable to common shareholders of $10.71 million for the year ended Dec. 31, 2017. As of Sept. 30, 2019, the Company had $2.41 million in total assets, $12.03 million in total liabilities, and a total stockholders' deficit of $9.62 million. MaloneBailey, LLP, in Houston, Texas, the Company's auditor since 2015, issued a "going concern" qualification in its report dated April 16, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, citing that the Company has a working capital deficit, has incurred recurring net losses and negative cash flows from operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. PRODIGY DIALYSIS: Has Until Aug. 24 to File Plan & Disclosures -------------------------------------------------------------- Judge Jeffery A. Deller of the U.S. Bankruptcy Court for the Western District of Pennsylvania has ordered that Debtor Prodigy, LLC Dialysis will file a Plan of Reorganization/Liquidation and Disclosure Statement by August 24, 2020. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/vfnhqmo from PacerMonitor at no charge. About Prodigy Dialysis Prodigy Dialysis, LLC, owns and operates a dialysis center located at 105 Metzler Street Johnstown, Pa. Prodigy Dialysis filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Penn. Case No.20-70105) on Feb. 25, 2020. In the petition signed by George J. Frem, M.D., sole member and president, the Debtor disclosed $424,814 in assets and $1,134,220 in liabilities. Judge Jeffery A. Deller presides over the case. The Debtor is represented by Kevin J. Petak, Esq. at Spence, Custer, Saylor, Wolfe & Rose, LLC. PROTEC INSTRUMENT: April 30 Plan & Disclosure Hearing Set --------------------------------------------------------- On Feb. 17, 2020, Protec Instrument Corporation and the jointly administered debtor Protec RE Holdings Inc. filed a Joint Combined Disclosure Statement and Plan of Reorganization for Small Business Debtor. On March 13, 2020, Judge Christopher J. Panos ordered that: * April 30, 2020, at 11:30 a.m., in Courtroom 3, U.S. Bankruptcy Court, 595 Main Street, Worcester, MA, is the hearing on the final approval of the adequacy of the Disclosure Statement, confirmation of the Plan of Reorganization and related matters. * April 20, 2020, at 4:30 p.m. is fixed as the last day to file any objections to the Court’s final determination of the adequacy of the Disclosure Statement, and confirmation of the Plan of Reorganization. * April 20, 2020, at 4:30 p.m. is fixed as the last day to file Convenience Class Election Ballots. * April 20, 2020, at 4:30 p.m. is fixed as the last day to file Ballots Accepting or Rejecting the Plan of Reorganization. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/sgukd9a from PacerMonitor at no charge. About Protec Instrument Corp. Protec Instrument Corporation manufactures analytical instruments. Protec RE Holdings owns a property located at 38-40 Edge Hill Road, Waltham, Massachusetts having an appraised value of $2.17 million. Protec Instrument Corp. and Protec RE Holdings sought Chapter 11 protection (Bankr. D. Mass. Lead Case No. 19-12164) on June 25, 2019. As of the Petition Date, Protec Instrument disclosed assets of $3,472,694 and liabilities of $2,725,521; and Protec RE disclosed assets of $2,170,000 and liabilities of $2,458,971. The Hon. Christopher J. Panos is the case judge. Parker & Associates is the Debtors' counsel. PS HOLDCO: Moody's Places B2 CFR on Review for Downgrade -------------------------------------------------------- Moody's Investors Service placed the ratings of PS HoldCo, LLC, the flatbed transportation and logistics provider that operates under the name PS Logistics, on review for downgrade, including the B2 Corporate Family Rating, the B2-PD Probability of Default Rating and the B2 rating of the $315 million term loan due 2025. RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The transportation sector is one of the sectors that will be significantly affected by the shock, in part given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in PS HoldCo's credit profile, including its exposure to cyclical industrial production and construction spending in North America, have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions, which are likely to affect PS HoldCo's credit metrics as the outbreak continues to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial credit implications of public health and safety. The action reflects the expected impact on PS HoldCo of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. In its review, Moody's will consider (i) the company's liquidity (ii) the severity of the impact of the coronavirus outbreak on freight shipments, (iii) the ability of the company to adapt its costs and investments in a timely manner to possibly rapid changes in freight demand, and (iv) the potential to restore credit metrics when economic activity recovers following the coronavirus outbreak. The ratings of PS HoldCo reflect the company's position as one of the largest providers of flatbed transportation and logistics services with historically attractive margins and moderate financial leverage. Nonetheless, the company is exposed to end-markets that are correlated with cyclical industrial production and construction spending in North America. PS HoldCo typically maintains a minimal cash balance and availability under its $75 million revolving credit facility is reduced due to funding for acquisitions in 2019. As an operator of heavy-duty trucks with diesel engines, PS HoldCo is also exposed to the environmental risk that emission regulations will become more stringent, which could result in higher engine costs. Factors that would lead to an upgrade or downgrade of the ratings: The ratings could be downgraded if Moody's expects EBITA margins to be less than 5%, debt/EBITDA to exceed 4.5 times or free cash flow to be consistently negative. Tightening liquidity, an accelerated pace of acquisitions or an increase in average fleet age to well in excess of 30 months could also cause a ratings downgrade. There will be no upward pressure on the ratings until freight shipments increase along with general economic improvement in the US. The ratings could be upgraded if EBITA margins are at least 7%, debt/EBITDA is maintained at 3.5 times or less, and the company demonstrates consistently positive free cash flow while maintaining adequate investments in its fleet, such that (retained cash flow minus capital expenditures)/debt is at least 4%. The following rating actions were taken: On Review for Downgrade: Issuer: PS HoldCo, LLC Corporate Family Rating, Placed on Review for Downgrade, currently B2 Probability of Default Rating, Placed on Review for Downgrade, currently B2-PD Senior Secured Bank Credit Facility, Placed on Review for Downgrade, currently B2 (LGD4) Outlook Actions: Issuer: PS HoldCo, LLC Outlook, Changed To Rating Under Review From Stable The principal methodology used in these ratings was Surface Transportation and Logistics published in May 2019. PS HoldCo, LLC, headquartered in Birmingham, AL, is a flatbed transportation and logistics provider that operates a fleet of about 3,100 trucks and has 37 terminal locations in the eastern and southeastern U.S. The company generated about $800 million of revenues (excluding fuel surcharges) in 2019. PS HoldCo, LLC is privately owned by funds managed by One Equity Partners and management. PUBLIC BIKES: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Public Bikes, Inc. 601 California Street, Suite 1300 San Francisco, CA 94108 Business Description: Public Bikes, Inc. is a lessor of nonfinancial intangible assets (except copyrighted works). Chapter 11 Petition Date: March 31, 2020 Court: United States Bankruptcy Court Northern District of California Case No.: 20-30310 Judge: Hon. Dennis Montali Debtor's Counsel: Michael St. James, Esq. ST. JAMES LAW, P.C. 22 Battery St. Suite 888 San Francisco, CA 94111 Tel: 415-391-7566 E-mail: michael@stjames-law.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Gregory Sherwood Cohelan, authorized individual. The Debtor did not file with the petition a list of its 20 largest unsecured creditors at the time of the filing. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/pBSrdS R-DREAM FARM: Judge Extends Exclusivity Period to April 9 --------------------------------------------------------- Judge Thomas Agresti of the U.S. Bankruptcy Court for the Western District of Pennsylvania extended to April 9 the deadline for R-Dream, LLC to file its Chapter 11 plan and disclosure statement. The bankruptcy judge also extended to April 9 the period during which only R-Dream can file a plan. R-Dream is currently seeking financing to help the company get through bankruptcy. If the financing effort fails, it is likely that the company will ask for the bankruptcy case to be dismissed or converted to one under Chapter 7. About R-Dream Farm R-Dream Farm, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No. 19-10920) on Sept. 11, 2019. At the time of the filing, the Debtor was estimated to have assets of between $500,001 and $1 million and liabilities of between $100,001 and $500,000. Judge Thomas P. Agresti oversees the case. The Debtor is represented by Steidl & Steinberg. REGIONAL HEALTH: Reports $3.5 Million Net Loss for 2019 ------------------------------------------------------- Regional Health Properties, Inc., filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss attributable to the company's common stockholders of $3.50 million on $20.13 million of total revenues for the year ended Dec. 31, 2019 compared to a net loss attributable to the company's common stockholders of $19.88 million on $22.05 million of total revenues for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $113.76 million in total assets, $102.02 million in total liabilities, and $11.74 million in total stockholders' equity. Regional Health said, "The Company is undertaking measures to grow its operations, streamline its cost infrastructure and otherwise increase liquidity by: (i) refinancing or repaying debt to reduce interest costs and mandatory principal repayments, with such repayment to be funded through potentially expanding borrowing arrangements with certain lenders or raising capital through the issuance of securities after restructuring of the Company's capital structure; (ii) increasing future lease revenue through acquisitions and investments in existing properties; (iii) modifying the terms of existing leases; (iv) replacing certain tenants who default on their lease payment terms; and (v) reducing other and general and administrative expenses. "Management anticipates access to several sources of liquidity, including cash on hand, cash flows from operations, and debt refinancing during the twelve months from the date of this filing. At December 31, 2019, the Company had $4.4 million in unrestricted cash, $7.4 million current assets and $14.1 million in current liabilities and negative working capital of approximately $0.6 million which excludes $6.1 million of current operating lease obligation. During the twelve months ended December 31, 2019, the Company generated positive cash flow from continuing operations of $3.0 million and anticipates continued positive cash flow from operations in the future. "The continuation of our business was dependent upon our ability: (i) to comply with the terms and conditions under the Pinecone Credit Facility and the Second A&R Forbearance Agreement as amended on June 13, 2019; and (ii) to refinance or obtain further debt maturity extensions on the Quail Creek Credit Facility, neither of which was entirely within the Company's control. These factors had created substantial doubt about the Company's ability to continue as a going concern. However, the going concern issue was resolved when Company repaid the Pinecone Credit Facility and Quail Creek Credit Facility on August 1, 2019." A full-text copy of the Form 10-K is available for free at: https://is.gd/L18WVt About Regional Health Regional Health Properties, Inc. (NYSE American: RHE) (NYSE American: RHEpA) -- http://www.regionalhealthproperties.com/-- is the successor to AdCare Health Systems, Inc., and is a self-managed healthcare real estate investment company that invests primarily in real estate purposed for senior living and long-term healthcare through facility lease and sub-lease transactions. Regional currently owns, leases or manages for third parties 24 facilities (12 of which are owned by Regional, 12 of which are leased by Regional and three of which are managed by Regional for third parties). RENAISSANCE HEALTH: May 19 Plan & Disclosure Hearing Set -------------------------------------------------------- On March 10, 2020, at 1:30 p.m., the U.S. Bankruptcy Court for the Southern District of Florida, West Palm Beach Division, held a hearing upon the Expedition Motion to Continue Confirmation Hearing, Final Approval of Disclosure Statement, Fee Applications and Extend All Related Deadlines filed by debtor Renaissance Health Publishing, LLC, d/b/a Renown Health Products. On March 13, 2020, Judge Mindy A. Mora ordered that: * The Debtor's Motion is granted. * March 24, 2020, is the deadline for the Debtor to file an amended Plan and amended Disclosure Statement. * May 19, 2020, at 1:30 p.m., is the Plan confirmation hearing, the hearing on final approval of the Disclosure Statement, and the hearing to consider fee applications. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/wfa8ah2 from PacerMonitor at no charge. Attorneys for the Debtor: Aaron A. Wernick, Esq. Furr Cohen, P.A. 2255 Glades Rd., #301E Boca Raton, FL 33431 Tel: (561) 395-0500 Fax: (561) 338-7532 E-mail: awernick@furrcohen.com About Renaissance Health Publishing Renaissance Health Publishing, LLC, doing business as Renown Health Products, filed a Chapter 11 bankruptcy petition (Bankr. S.D. Fla. Case No. 19-13729) on March 22, 2019, disclosing under $1 million in both assets and liabilities. The Debtor tapped Aaron A. Wernick, Esq., at Furr Cohen, P.A., as bankruptcy counsel, and Schneider Rothman IP Law Group, as special counsel. ROLETTE COUNTY, ND: Moody's Alters Outlook on Ba1 Rating to Stable ------------------------------------------------------------------ Moody's Investors Service has affirmed Rolette County, ND's Ba1 issuer rating and Ba3 lease revenue ratings. The county has $9.4 million in rated lease revenue debt. The outlook has been revised to stable from negative. The issuer rating represents Moody's assessment of hypothetical debt of the county supported by a general obligation unlimited tax pledge. The county does not currently have any outstanding debt supported by a GOULT pledge. RATINGS RATIONALE The Ba1 issuer rating reflects the county's small tax base, below average resident income indices, a very narrow financial position and an elevated debt burden. Positively, the county's tax base is growing, and unfunded pension liabilities are moderate. The issuer rating is equivalent to the rating it would assign to bonds secured by the county's general obligation unlimited tax (GOULT) pledge. The Ba3 lease revenue rating is notched twice from the county's issuer rating due to the risk of annual non-appropriation of lease payments, which will be funded in part with volatile revenue sources; the more essential nature of the pledged assets (the county's new jail); and the risks associated with operating the jail facility, which opened in early 2018. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The coronavirus crisis is not a key driver for this rating action. Moody's does not see any material immediate credit risks for Rolette County. However, the situation surrounding Coronavirus is rapidly evolving and the longer-term impact will depend on both the severity and duration of the crisis. If its view of the credit quality of Rolette County changes, Moody's will update the rating and/or outlook at that time. RATING OUTLOOK The stable outlook reflects its expectation that the county's credit characteristics will continue to stabilize given consistent tax base growth and projected improvement in fund balance, which is needed to mitigate the county's high leverage. Factors that would lead to an upgrade or downgrade of the ratings: FACTORS THAT COULD LEAD TO AN UPGRADE - Significant increases to operating reserves and liquidity (issuer rating) - Upgrade in issuer rating (lease rating) FACTORS THAT COULD LEAD TO A DOWNGRADE - Negative budget variances in revenue that reduce liquidity (issuer rating) - Inability to cover lease payments without further drawing down reserves (issuer rating) - Failure to appropriate for lease payments (issuer and lease ratings) - Downgrade in issuer rating (lease rating) LEGAL SECURITY The lease revenue bonds are secured by rental payments made by the county to the trustee Zion Bank, subject to annual appropriation. Per a lease-purchase agreement, initially executed upon issuance of the bonds, the bonds are secured by lease payments equal to debt service from the county directly to the trustee, subject to annual appropriation. PROFILE Rolette County is located in north central North Dakota (Aa1 stable) along the border of Manitoba (Aa2 stable), Canada (Aaa stable), and encompasses 913 square miles. It is home to roughly 14,603 residents as of 2018. The Turtle Mountain Reservation is located on 46,000 acres in the county. ROSA MARIA STYLES: Meles Buying Avalon Property for $3 Million -------------------------------------------------------------- Rosa Maria Styles asks the U.S. Bankruptcy Court for the District of New Jersey to authorize the sale of her real property known as 43 West 12th Street, Avalon, New Jersey, also known as Lots 9.01 & 9.02, Block 11.02 on the Borough of Avalon Tax Map, to Andrew J. Mele and Christine L. Mele for $2.995 million. The Debtor certifies that the property contains a recently constructed single family residential dwelling. She listed said property for sale in December 2019 with Robert J. Scully, Jr., CRB, of Ferguson Dechert Real Estate, a reputable real estate broker located in Avalon, New Jersey. The subject property was actively marketed for sale for the listing price of $3 million. On Dec. 23, 2019, the Debtor entered into an arms-length Purchase and Sale Agreement for the sale of the subject property to an unrelated third-party, the Buyers, husband and wife, the purchaser, for the consideration of $2.995 million. Accordingly, said amount represents the aggregate, current value of the parcel of real estate. In consideration of the fact that said Contract failed to indicate the need for Bankruptcy Court Approval of the transaction, the agreement was amended by an Addendum dated Jan. 8, 2020 extending the dates for the Purchasers' tendering of the additional $200,000 deposit, and extending the mortgage contingency date and the dates for completion of inspections until after the Sellers' acquisition of Court Approval of the sale. Pursuant to said Contract, the Buyers have submitted an initial good faith deposit of $10,000 to be held in escrow pursuant to Contract terms and closing of the sale. The sale will be free and clear of all liens and encumbrances except any real estate tax and/or municipal liens of the Borough of Avalon, Cape May County, New Jersey: a. the first mortgage from Rosa Styles to Thomas J. Welsh, Jr., dated June 22, 2017, recorded June 27, 2017 in the Cape May County Clerk's/Register's Office in Mortgage Book 5879, Page 462, showing an amount of $1.55 million; b. the second mortgage from Rosa Styles to Thomas J. Welsh, Jr., dated June 22, 2017, recorded Aug. 25, 2017 in the Cape May County Clerk's/Register's Office in Mortgage Book 5895, Page 711, showing an amount of $500,000; c. payment of outstanding judgments of record including Capital One Bank (USA), N.A. v. Rosa Styles under Judgment Number DJ-054721-2010, docketed 2/24/2010 for $3,736 plus interest and costs, Capital One Bank (USA), N.A. v. Rosa M. Styles under Judgment Number DJ-138276-2010, docketed 6/1/2010 for $3,250 plus interest and costs and Capital One Bank (USA), N.A. v. Rosa M. Styles under Judgment Number DJ-196733-2010, docketed 8/2/2010 for $3,953.92 plus interest and costs, for payment of the allowed costs of sale; d. with the balance of the sales proceeds deposited into an interest bearing escrow account to be held by the Sellers' retained special real estate counsel pending a determination of the validity of the mortgage lien held by CBEV, LLC, a Georgia limited liability company, dated May 24, 2018, recorded June 6, 2018 in the Cape May County Clerk's/Register's Office in Mortgage Book 5975, Page 624, showing an amount of $15,069,740. Approval of the present application will enable the Debtor to payoff the valid, genuine obligations secured by the subject property thereby significantly reducing her overall indebtedness and enhancing the ability to propose a viable, Chapter 11 plan of reorganization which will benefit her estate and its other creditors which have interests in the and other estate property. Further, granting the present application is justified by the facts and circumstances of the case and will allow her to satisfy contractual conditions precedent to sale while enabling the Purchasers to obtain the benefit of its bargain by permitting me to utilize sale proceeds in the best interests of the estate and its creditors. The proceeds of sale will be distributed as follows: a. First, the amount needed to satisfy in full any municipal taxes, water and/or sewer charges, if any due to the Borough of Avalon; b. Second, the amount necessary to satisfy the first and second Thomas J. Welsh, Jr. mortgages plus accrued interest, that constitute valid liens upon the property for release and discharge of all its liens against the property subject to the Agreement; c. Third, payment of outstanding judgments of record; d. Fourth, payment of the costs of sale and expenses commonly associated with the sale of real property in New Jersey, including, but not necessarily limited to, realty transfer fees, statutory lien cancellation fees, real estate broker’s commissions and special counsel attorney fees in accordance with the Notice of Proposed Private Sale; e. The balance of sale proceeds will be deposited into an interest bearing escrow account to be held by the Sellers' retained special real estate counsel pending a determination of the validity of the mortgage lien held by CBEV, LLC, a Georgia limited liability company, dated May 24, 2018, recorded June 6, 2018 in the Cape May County Clerk's/Register's Office in Mortgage Book 5975, Page 624, showing an amount of $15,069,740. A hearing on the Motion is set for March 24, 2020 at 10:00 a.m. The Objection Deadline is seven days prior to the hearing date set. A copy of the Contract is available at https://tinyurl.com/sony7bx from PacerMonitor.com free of charge. Rosa Maria Styles sought Chapter 11 protection (Bankr. D. N.J. Case No. 19-32881) on Dec. 9, 2019. On Feb. 11, 2020, the Court appointed Robert J. Scully, Jr., CRB, of Ferguson Dechert Real Estate, as Broker. SCIENTIFIC GAMES: Issues Statement on COVID-19 Response ------------------------------------------------------- Scientific Games Corporation said it is taking essential actions to respond to the global COVID-19 crisis. Scientific Games CEO Barry Cottle said: "Like many others, our industry is facing unprecedented challenges from the widespread impact of the COVID-19 outbreak. We are working around the clock to take care of our employees, customers, shareholders and other key stakeholders in these difficult times, while providing uninterrupted products and services to those customers who continue to operate. Thankfully, we came into this year with a very strong liquidity position, including substantial capacity under our revolver, and also refinanced our debt, extended our major maturities and lowered our interest expense. We have a diverse portfolio of assets, product and services that uniquely position us to weather this crisis. "We are taking a variety of actions to help ensure that we meet the demands of this outbreak and are ready when the industry begins to recover. I am confident that the measures we are taking now will prepare us to come out of the crisis even stronger than before. And, I have never been prouder to lead a team where everyone is stepping up to help each other, our partners and our Company. "The Company is instituting a number of cost-savings measures to ensure stability for team members and protect the operations of the Company. Some of these measures include workforce hour and pay reductions to preserve as many jobs as possible and furloughs for those support roles that have seen a decrease in industry work. During this challenging time, the executive leadership team has committed to a voluntary 50% salary reduction while Chief Executive Officer Barry Cottle has volunteered a 100% reduction in pay. "We recognize that the temporary furloughs that are made necessary by the impact of COVID-19 on our Company create substantial hardship for the furloughed employees and their families. We are establishing a Hardship Relief Fund to provide short-term assistance to those employees and their immediate families who incur unexpected and onerous personal, family, or living expenses as a result of the COVID-19 crisis. The Company, Barry Cottle and several other senior executives will be making contributions to the fund. "Scientific Games is committed to supporting our customers in this crisis by continuing to provide quality, secure products and services to partners across lottery, iGaming, sports betting and land-based casinos. In addition, SciPlay continues to publish free-to-play apps for players to enjoy. "Scientific Games leadership will continue to evaluate this rapidly-evolving situation and assess the duration of cost-savings measures based on the continuing impact of COVID-19. About Scientific Games Based in Las Vegas, Nevada, Scientific Games Corporation (NASDAQ:SGMS) -- http://www.scientificgames.com/-- is a developer of technology-based products and services and associated content for the worldwide gaming, lottery, social and digital gaming industries. Its portfolio of revenue-generating activities primarily includes supplying gaming machines and game content, casino-management systems and table game products and services to licensed gaming entities; providing instant and draw-based lottery products, lottery systems and lottery content and services to lottery operators; providing social casino solutions to retail consumers and regulated gaming entities, as applicable; and providing a comprehensive suite of digital RMG and sports wagering solutions, distribution platforms, content, products and services. Scientific Games reported a net loss of $118 million for the year ended Dec. 31, 2019, compared to a net loss of $352 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $7.81 billion in total assets, $9.91 billion in total liabilities, and a total stockholders' deficit of $2.11 billion. SCORPION FITNESS: CEO Balks at Chapter 11 Trustee Appointment ------------------------------------------------------------- John Shams, CEO and principal founder of Scorpion Fitness, Inc. and Scorpion Club Ventures LLC, is asking the Bankruptcy Court for more time to file an appeal challenging the Bankruptcy Court's order authorizing the appointment of Salvatore LaMonica as Chapter 11 trustee for the Debtors. He said, "I have been directly and adversely affected peculiarly by this order. As a central party of interest in this case as both a creditor and an equity interest holder I have a right to adequate notice and the opportunity to participate in a meaningful way in the course of a bankruptcy proceeding. Due process requires that a party receive notice, which is reasonably calculated, under all circumstances, to apprise interested parties of the pending action so that they can present their view and protect their rights. See Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306 (1950)." "The Chapter 11 oral motion and subsequent UST's motion to appoint a Chapter 11 Trustee was at the behest of certain creditors who have substantially benefitted from the outcome of the proceedings from my detriment and loss," he added. About Scorpion Fitness Scorpion Fitness Inc., own a high-end boutique gym located at 220 Fifth Avenue, New York, NY. Scorpion Fitness filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 19-11231) on April 22, 2019, disclosing under $1 million in both assets and liabilities. The Debtor hired Kevin J. Nash, Esq., at Goldberg Weprin Finkel Goldstein LLP, as bankruptcy counsel, and Kushnick Pallaci PLLC, as special construction law counsel. SEARS HOLDINGS: Dist. Court Disallows Assignment of MOAC Lease -------------------------------------------------------------- In the appeals case MOAC MALL HOLDINGS LLC, Appellant, v. TRANSFORM HOLDCO LLC and SEARS HOLDINGS CORPORATION, et al. Appellees, No. 19 Civ. 09140 (CM) (S.D.N.Y.) Chief District Judge Colleen McMahon vacates the Bankruptcy Court's order to the extent it approved the assumption and assignment of Sears' lease at the Mall of America to Transform and remands to the Bankruptcy Court for further proceedings. MOAC took an appeal from an order issued by Bankruptcy Judge Robert Drain approving the assignment and assumption of Sears' lease at the Minneapolis shopping mall cum amusement and entertainment venue. Transform Leaseco LLC, an affiliate and wholly-owned subsidiary of Transform Holdco LLC, as the approved assignor, is not a business establishment. Transform was formed and is headed by Sears' final CEO, Eddie Lampert, and several other former Sears executives. Transform's goal is to gain control of substantially all of Sears' assets, including Sears' many real estate holdings, through Sears' bankruptcy proceedings. Transform provisionally acquired 660 Sears leases in a sale order entered by the Bankruptcy Court, 659 of which the court has approved for assignment to Transform. Transform plans to continue to operate approximately 400 of these 660 leases (i.e., Transform will continue to operate Sears stores at those locations) and to market the remaining 260 in order to find new tenants to occupy those premises. Mall of America is not interested in seeing Sears' three-story building leased out by Transform. Mall of America's owner, MOAC, wants the lease to revert to it, the landlord, so that it can control who gets to occupy that very prestigious space. MOAC insists that, under certain provisions in the Bankruptcy Code that were passed to protect the owners and tenants of "shopping centers," the lease may not be assigned to Transform and must revert to the landlord. Judge Drain disagreed with MOAC's argument that 11 U.S.C. sections 365(b)(3)(A) and/or (b)(3)(D) prohibited the assignment of the Mall of America lease to Transform. He approved the assignment and assumption as proposed by Sears. But Judge Drain admitted that, at least insofar as his ruling addressed section 365(b)(3)(A), his ruling was one of first impression. MOAC has appealed from the Bankruptcy Court's order. The District Court agrees with the Bankruptcy Jthat nothing in section 365(b)(3)(D) of the Code prohibits the transfer of the Lease to Transform. However, the District Court disagrees with his conclusion that section 365(b)(3)(A) does not bar the proposed assignment. In section 365(b)(3)(A), Congress provided a rigorous standard that an assignee of a bankrupt's shopping center lease must meet in order to give the landlord adequate assurance that the new tenant will not shortly end up in bankruptcy. In this case, the Bankruptcy Court found that the tenant did not meet that standard. The judge's decision that an alternative provision in Sears' Lease could be substituted for the statutory standard effectively read the congressionally-mandated standard out of the Bankruptcy Code. The District Court does not believe that result can be justified. The proposed assignment is, therefore, disallowed. A copy of the District Court's Decision dated Feb. 27, 2020 is available at https://bit.ly/2IvwqPx from Leagle.com. MOAC Mall Holdings LLC, Appellant, represented by Daniel Abraham Lowenthal, III -- dalowenthal@pbwt.com -- Patterson, Belknap, Webb & Tyler LLP, David Wayne Dykhouse -- dwdykhouse@pbwt.com -- Patterson, Belknap, Webb & Tyler LLP, Tom Flynn -- tflynn@larkinhoffman.com -- Larkin, Hoffman, Daly & Lindgren, Ltd. & Alexander J. Beeby -- abeeby@larkinhoffman.com -- Larkin, Hoffman, Daly & Lindgren, Ltd. Sears Holdings Corporation, Appellee, represented by Garrett Avery Fail , Weil, Gotshal & Manges LLP, Jacqueline Marcus -- jacqueline.marcus@weil.com -- Weil, Gotshal & Manges LLP, Ray C. Schrock -- ray.schrock@weil.com -- Weil Gotshal & Manges LLP & Sunny Singh -- sunny.singh@weil.com -- Weil, Gotshal & Manges LLP. Transform Holdco LLC, Appellee, represented by Rachel Ehrlich Albanese -- rachel.albanese@dlapiper.com -- DLA Piper US LLP, Richard A. Chesley -- richard.chesley@dlapiper.com -- DLA Piper LLP, Robert Craig Martin -- craig.martin@dlapiper.com -- DLA Piper LLP & Alana M. Friedberg -- alana.friedberg@dlapiper.com -- DLA Piper LLP. About Sears Holdings Sears Holdings Corporation (OTCMKTS: SHLDQ) --http://www.searsholdings.com/-- began as a mail ordering catalog company in 1887 and became the world's largest retailer in the 1960s. At its peak, Sears was present in almost every big mall across the U.S., and sold everything from toys and auto parts to mail-order homes. Sears claims to be is a market leader in the appliance, tool, lawn and garden, fitness equipment, and automotive repair and maintenance retail sectors. Sears and Kmart merged to form Sears Holdings in 2005 when they had 3,500 US stores between them. Kmart emerged in 2005 from its own bankruptcy. Unable to keep up with online stores and other brick-and-mortar retailers, a long series of store closings has left it with 687 retail stores in 49 states, Guam, Puerto Rico, and the U.S. Virgin Islands as of mid-October 2018. At that time, the Company employed 68,000 individuals, of whom 32,000 are full-time employees. As of Aug. 4, 2018, Sears Holdings had $6.93 billion in total assets, $11.33 billion in total liabilities and a total deficit of $4.40 billion. Unable to cover a $134 million debt payment due Oct. 15, 2018, Sears Holdings Corporation and 49 subsidiaries sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 18-23538) on Oct. 15, 2018. The Hon. Robert D. Drain is the case judge. The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel; M-III Partners as restructuring advisor; Lazard Freres & Co. LLC as investment banker; DLA Piper LLP as real estate advisor; and Prime Clerk as claims and noticing agent. The U.S. Trustee for Region 2 appointed nine creditors, including the Pension Benefit Guaranty Corp., and landlord Simon Property Group, L.P., to serve on the official committee of unsecured creditors. The committee tapped Akin Gump Strauss Hauer & Feld LLP as legal counsel; FTI Consulting as financial advisor; and Houlihan Lokey Capital, Inc. as investment banker. The U.S. Trustee for Region 2 on July 9, 2019, appointed five retirees to serve on the committee representing retirees with life insurance benefits in the Chapter 11 cases. * * * In February 2019, Bankruptcy Judge Robert Drain granted Sears Holdings approval to sell the business to majority shareholder and CEO Eddie Lampert for approximately $5.2 billion. Lampert's ESL Investments, Inc., has won an auction to acquire substantially all of Sears' assets, including the "Go Forward Stores" on a going-concern basis. The proposal will allow 425 stores to remain open and provide ongoing employment to 45,000 employees. SENIOR CARE: Passages Hospice Buying Hospice Equity for $750K ------------------------------------------------------------- Senior Care Centers, LLC, and its debtor affiliates ask the U.S. Bankruptcy Court for the Northern District of Texas to authorize the sale of the equity interests of: (i) Gamble Hospice Care Central LLC, (ii) Gamble Hospice Care Northeast LLC, and (iii) Gamble Hospice Cenla, LLC, to Passages, LLC, doing business as Passages Hospice, or an affiliate thereof, for $750,000. The Debtors have undertaken robust marketing efforts with respect to the Hospice Equity, ensuring maximum recoveries for the Debtors, their estates, creditors of their estates, and all parties in interest. Prior to the Petition Date, the Debtors engaged H2C Analytics, LLC as their investment banker to market for sale, among other things, the Hospice Equity. H2C has undertaken a robust marketing process to obtain purchasers and potential bids for all or a portion of the Hospice Equity on a post-petition basis. The marketing of the Hospice Equity has included extensive business discussions, including telephone calls, in-person meetings between and among senior management, the parties, legal teams, and the parties’ various advisors, which marketing efforts are still ongoing. Based on the extensive diligence, the Debtors, in consultation with their advisors, have determined that consummation and effectuation of the Membership Interest Purchase Agreement is the best and most efficient way to maximize the value of the Hospice Equity for the Debtors, their estates, creditors of their estates, and all parties in interest. By the Motion, the Debtors ask entry of the Proposed Order, authorizing and approving the sale of the equity interests in Hospice Equity free and clear of all liens, claims, interests, and encumbrances pursuant to the Membership Interest Purchase Agreement, and granting related relief. Finally, the Debtors ask the Court a waiver of Bankruptcy Rule 6004(h) and Rule 6006(d). A copy of the Agreement is available at https://tinyurl.com/re87xjj from PacerMonitor.com free of charge. About Senior Care Centers Senior Care Centers, LLC -- https://senior-care-centers.com/ -- is a Dallas-based, skilled nursing and long-term care industry leader in Texas and Louisiana. Senior Care Centers operates and manages more than 100 skilled nursing and assisted/independent living communities in the states of Texas and Louisiana. On Dec. 4, 2018, Senior Care Centers and 120 of its subsidiaries filed voluntary Chapter 11 petitions (Bankr. N.D. Tex. Lead Case No. 18-33967). The Debtors tapped Polsinelli PC as bankruptcy counsel; Hunton Andrews Kurth LLP as conflicts counsel; Sitrik and Company as communications consultant; and Omni Management Group, Inc., as claims, noticing, and administrative agent. On Dec. 14, 2018, the Office of the United States Trustee for the Northern District of Texas appointed an official committee of unsecured creditors in these Chapter 11 cases. SHERWIN ALUMINA: 5th Cir. Upholds Dismissal of Port's Fraud Claims ------------------------------------------------------------------ In the appeals case captioned PORT OF CORPUS CHRISTI AUTHORITY, Appellant, v. SHERWIN ALUMINA COMPANY, L.L.C.; SHERWIN PIPELINE, INC., Appellees, No. 18-40557 (5th Cir.), the United States Court of Appeals, Fifth Circuit affirms the dismissal of the Port's Eleventh Amendment and fraud claims, and the denial of leave to amend their complaint. A bankruptcy sale extinguished an easement of the Port of Corpus Christi Authority, an arm of the State of Texas. The Port initiated an adversary proceeding against the debtors, Sherwin Alumina Company and Sherwin Pipeline Incorporated, seeking to invalidate the sale and regain its easement. The bankruptcy court rejected the Port's sovereign immunity and fraud claims, and the district court affirmed. On appeal from the district court, the Fifth Circuit finds no Eleventh Amendment violation or basis for a claim of fraud under 11 U.S.C. Section 1144. In 1998, the Port of Corpus Christi Authority purchased an 1,100 acre parcel near Corpus Christi Bay in San Patricio County, Texas, adjacent to land owned by the Sherwin Alumina Company, together with an easement granting use and access to a private roadway on the Company's land known as La Quinta Road. In 2013, the Port and Sherwin Alumina Company agreed to modify the easement, giving the Port permanent non-exclusive access along a specific portion of the road and across an adjoining drainage ditch. The easement provided the primary means of commercial access to the Port's parcel. On Jan. 11, 2016, Sherwin Alumina Company and Sherwin Pipeline Incorporated filed voluntary petitions for Chapter 11 relief in the Bankruptcy Court for the Southern District of Texas. Sherwin also filed an initial Joint Plan for reorganization, proposing in relevant part to sell real property in the bankruptcy estate "free and clear of all Liens, Claims, charges and other encumbrances" under Section 363(f) of the Bankruptcy Code. The bankruptcy court approved bidding procedures. The Port bid for a port facility that did not include the La Quinta Road parcel. The Port conditioned its bid on "an access easement . . . over Seller's private roadway known as La Quinta Road . . . if Buyer has been unable to obtain such an easement before the Closing." On April 21, 2016, the Port and other bidders participated in an auction from which Corpus Christi Alumina emerged as the successful bidder. In the following months Sherwin filed modified plans and associated purchase agreements in which encumbrances other than those deemed "permitted" would be stripped off the estate's property in the proposed sale, as authorized under Section 363(f) of the Bankruptcy Code. Permitted encumbrances would be defined in a future proposed confirmation order. None of these documents suggested that the Port's easement would be a permitted encumbrance. On March 31, 2017, Corpus Christi Alumina sold the land encompassing La Quinta Road to Cheniere Land Holdings LLC. Cheniere notified the Port that its easement had been extinguished by the sale of the land. As the time to appeal the confirmation order had expired, the Port filed an adversary complaint with the bankruptcy court, collaterally attacking the confirmation order as having been procured by fraud, barred by the state's sovereign immunity, and a denial of due process for want of notice. The bankruptcy court dismissed the claims of fraud and sovereign immunity without leave to amend but denied dismissal of the due process claim. The Port appealed the dismissals and denial of leave to amend to the district court, which affirmed. This appeal followed. Under Texas law, the Port's easement is a non-possessory property interest in Sherwin's land. That the servient land was within the bankruptcy estate is not disputed. Exercising jurisdiction over the Sherwin estate, and thus the servient land, the bankruptcy court approved a Section 363(f) sale "free and clear" of encumbrances, including the Port's La Quinta Road easement. The bankruptcy court did not award affirmative relief nor deploy coercive judicial process against the Port -- it did not exercise in personam jurisdiction over the state. Section 363(f) of the Bankruptcy Code provides that the court may sell property in the bankruptcy res free and clear of others' interests, but only under certain limited circumstances.18 The Port argues that none of those circumstances was met in the sale of the easement. However, this argument is foreclosed. As the Port concedes, any Section 363(f) objection had to have been raised on direct appeal of the confirmation order and cannot be raised in this collateral adversary proceeding. The 5th Cir. affirms the dismissal of the Port's Eleventh Amendment claim. Also under Texas law, an easement is a type of encumbrance. From the beginning, by the general terms of Sherwin's proposed sale, the debtor proposed a Section 363(f) sale that would extinguish the Port's easement. The Port's actions indicate that it so understood the proposed sale: in its unsuccessful bid for certain estate lands it also sought to preserve the La Quinta Road easement, on the implicit understanding that, absent agreement providing otherwise, its La Quinta Road easement would be extinguished under the terms of the sale. Sherwin's last-minute modifications to the plan carved out exceptions to encumbrances on the estate lands to be extinguished in the sale, preserving a number of other encumbrances, including those recorded before July 2009. The Debtors' counsel's description of the changes as not "material in any real way" was not misleading because they were not changes at all with respect to the Port's easement. They did not affect the La Quinta Road easement, which remained subject to the same general rule that it would be stripped in the Section 363(f) sale as a "encumbrance" on the servient estate land. The Port's situation remained unchanged by the last-minute modifications. The Port does not allege the first element of fraud. The 5th Cir. affirms the dismissal of the Port's fraud claim. According to the Fifth Circuit, a court should grant leave to amend freely when justice so requires. It follows that where amendment would be futile, the court need not grant the plaintiff leave to amend. Here, the bankruptcy court dismissed the Port's fraud claim with prejudice, finding "[i]t would be futile to allow an amendment to the Complaint because there are no facts that could be plead[ed] to support" the claim. This determination was no abuse of discretion. The Port's fraud claim is premised on an alleged misrepresentation made by Sherwin's counsel regarding modifications. The bankruptcy court determined the Port could plead no additional fact to salvage this claim. The district court did not abuse its discretion in denying the Port leave to amend. In her dissenting opinion, Judge Edith Jones states that contrary to the bankruptcy court's wholesome open-mindedness, the panel opinion repeatedly implies that the Port could have/should have known the debtor's intentions to "extinguish" its easement, which the debtor allegedly swept into its documentation under the generic term "encumbrance." Although the facts have not been fully vetted, the Port's pleadings suggest quite a different story. No less than ten lengthy draft documents required for a proposed sale of the debtor's property were filed in the bankruptcy court over a period of months. Several of these described "Acquired Real Property" as including Easements, "other than the Excluded Properties." Excluded Assets, the debtor represented, was an undefined category that would be identified in a later schedule. The panel opinion states that "[n]one of these [transactional documents] suggested that the Port's easement would be a permitted encumbrance," i.e., an interest that would run with the land in an eventual sale. More precisely, however, never prior to the eve of confirmation was the schedule supplied, nor did any of the transactional documents reference the Port's easement directly or indirectly. Whether the evolving terms of the transactional documents (a) informed the Port sufficiently that its easement could be put at risk and (b) yielded sufficient opportunity to be heard at the confirmation hearing raises troubling and important due process issues to be resolved in the bankruptcy court. A copy of the Fifth Circuit's Decision dated Feb. 27, 2020 is available at https://bit.ly/2xis8bT from Leagle.com. Mark G. Arnold -- mark.arnold@huschblackwell.com -- for Appellant. Lynn Hamilton Butler -- lynn.butler@huschblackwell.com -- for Appellant. Marnie A. McCormick -- mmccormick@dwmrlaw.com -- for Appellant. Erin Murphy , for Appellee. Anna Rotman -- anna.rotman@kirkland.com -- for Appellee. Jamie Alan Aycock -- jamie.aycock@kirkland.com -- for Appellee. Mark C. Holden -- mark.holden@kirkland.com -- for Appellee. Joshua A. Sussberg -- joshua.sussberg@kirkland.com -- for Appellee. Gregory F. Pesce -- gregory.pesce@kirkland.com -- for Appellee. About Sherwin Alumina Company Sherwin Alumina Company, LLC, and Sherwin Pipeline, Inc., filed Chapter 11 bankruptcy petitions (Bankr. S.D. Tex. Case Nos. 16-20012 and 16-20013, respectively) on Jan. 11, 2016. Thomas Russell signed the petitions as authorized signatory. Judge David R. Jones has been assigned the case. The Debtors have engaged Kirkland & Ellis LLP as general counsel, Zack A. Clement PLLC as local counsel, Huron Consulting Services LLC as financial advisor and Kurtzman Carson Consultants LLC as claims, notice and balloting agent. Sherwin operates an alumina plant in Gregory, Texas that produces aluminum oxide (or alumina), which is the primary component of aluminum, from bauxite. Sherwin produces alumina through the "Bayer Process," a refining technique that produces alumina from bauxite ore by dissolving the bauxite in a caustic solution. The Debtors disclosed total assets of $254,617,187 and total liabilities of $218,177,760, on Feb. 5, 2016. The U.S. Trustee appointed five members to the Official Committee of Unsecured Creditors. Robin Russell, Esq., Timothy S. McConn, Esq., and Ashley Gargour, Esq., at Andrews Kurth LLP, in Houston, Texas, represent the Committee. SINTX TECHNOLOGIES: Reports $7.5 Million Net Loss for 2019 ---------------------------------------------------------- SINTX Technologies, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss attributable to common stockholders of $7.50 million on $689,000 of product revenue for the year ended Dec. 31, 2019, compared to a net loss attributable to common stockholders of $22.55 million on $95,000 of product revenue for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $9.15 million in total assets, $3.94 million in total liabilities, and $5.20 million in total stockholders' equity. In previous years the Company had indicated that there was substantial doubt as to its ability to continue as a going concern. Depending on the results of the Company's future operations, the Company may again have substantial doubt as to its ability to continue as a going concern. "If we seek additional financing to fund our business activities, investors or other financing sources may be unwilling to provide additional funding on commercially reasonable terms or at all. If we seek additional funds and are unable to obtain sufficient additional funding, our business, prospects, financial condition and results of operations will be materially and adversely affected, and we may be unable to continue as a going concern. If we are unable to continue as a going concern, we may have to liquidate our assets and may receive less than the value at which those assets are carried on our consolidated financial statements, and it is likely that investors will lose all or a part of their investment. Our future reports may disclose our doubt about our ability to continue as a going concern," SINTX said. A full-text copy of the Form 10-K is available for free at: https://is.gd/o5oPOp About SINTX Technologies Headquartered in Salt Lake City, Utah, SINTX Technologies -- https://ir.sintx.com/ -- is an OEM ceramics company that develops and commercializes silicon nitride for medical and non-medical applications. The core strength of SINTX Technologies is the manufacturing, research, and development of silicon nitride ceramics for external partners. The Company presently manufactures silicon nitride spinal implants in its ISO 13485 certified manufacturing facility for CTL-Amedica, the exclusive retail channel for silicon nitride spinal implants. On March 24, 2020, the Company received a notice from the Nasdaq Listing Qualifications Department of the Nasdaq Stock Market LLC stating that the bid price of the Company's common stock for the last 30 consecutive trading days had closed below the minimum $1.00 per share required for continued listing under Listing Rule 5550(a)(2). If the Company does not regain compliance with Rule 5550(a)(2) by Sept. 21, 2020, the Company may be afforded a second 180 calendar day period to regain compliance. To qualify, the Company would be required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, except for the minimum bid price requirement. In addition, the Company would be required to notify Nasdaq of its intent to cure the deficiency during the second compliance period, which may include, if necessary, implementing a reverse stock split. There can be no assurance that the Company will be able to regain compliance with Nasdaq requirements or will otherwise be in compliance with other Nasdaq listing criteria. SKLAR EXPLORATION: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Sklar Exploration Company, LLC 5395 Pearl Parkway, Suite 200 Boulder, CO 80301 Business Description: Sklar Exploration Company, LLC -- https://sklarexploration.com -- is an independent exploration production company owned and managed by Howard F. Sklar. With offices in Boulder, Colorado, Shreveport, Louisiana, and Brewton, Alabama, Sklar owns interests in oil and gas wells located throughout the United States. Sklar's exploration and production activities have historically focused on the hydrocarbon-rich Lower Gulf Coast basins and in the Interior Gulf Coast basins of East Texas, North Louisiana, South Mississippi, South Alabama, and the Florida Panhandle. Chapter 11 Petition Date: April 1, 2020 Court: United States Bankruptcy Court District of Colorado Case No.: 20-12377 Judge: Hon. Elizabeth E. Brown Debtor's Counsel: Lee M. Kutner, Esq. KUTNER BRINEN, P.C. 1660 Lincoln Street, Suite 1850 Denver, CO 80264 Tel: 303-832-2400 E-mail: lmk@kutnerlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $10 million to $50 million The petition was signed by Howard Sklar, manager. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/2y7Rl8 SOUTH ATLANTIC REGIONAL: Case Converted to Chapter 7 ---------------------------------------------------- At the behest of Scott N. Brown, the Chapter 11 trustee for South Atlantic Regional Center, LLC, Bankruptcy Judge Erik P. Kimball converted to the Debtor's chapter 11 case to one under Chapter 7 of the Bankruptcy Code. Nancy Gargula, the United States Trustee for Region 21, appointed Brown as Chapter 11 Trustee, after consulting with these parties-in-interest: a. Philip Landau, Esq., Counsel for 160 Royal Palm, LLC, which filed the involuntary petition to place the Debtor in bankruptcy; and b. David Baddley, Esq., Counsel for the Securities and Exchange Commission About South Atlantic Regional South Atlantic Regional Center, LLC, is a Florida corporation owned and managed by Joseph Wash, Sr. SARC is a United States Citizen and Immigration Services-designated regional center. South Atlantic Regional Center, LLC (Bankr. S.D. Fla. Case No. 19-25762) and its affiliates, USREDA (Bankr. S.D. Fla. Case No. 19-25780), United States Regional Economic Development Authority, Inc. (Bankr. S.D. Fla. Case No. 19-25799) and Connect Insurance Group, Inc. (Bankr. S.D. Fla. Case No. 19-25767), were subject to involuntary Chapter 11 petitions filed by 160 Royal Palm, LLC in November 2019. The petitioning creditor is represented by Shraiberg, Landau & Page, P.A. Judge Erik P. Kimball oversees the case. Scott Brown was appointed as Chapter 11 trustee for South Atlantic Regional Center. Bast Amron LLP is the trustee's legal counsel. SPANISH BROADCASTING: Swings to $928,000 Net Loss in 2019 --------------------------------------------------------- Spanish Broadcasting System, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $928,000 on $156.66 million of net revenue for the year ended Dec. 31, 2019, compared to net income of $16.49 million on $142.37 million of net revenue for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $469.04 million in total assets, $549.34 million in total liabilities, and a total stockholders' deficit of $80.30 million. Crowe LLP, in Fort Lauderdale, Florida, the Company's auditor since 2013, issued a "going concern" qualification in its report dated March 30, 2020, citing that the 12.5% Senior Secured Notes had a maturity date of April 15, 2017. Cash from operations or the sale of assets was not sufficient to repay the notes when they became due. In addition, at December 31, 2019, the Company had a working capital deficiency. These factors raise substantial doubt about its ability to continue as a going concern. The Company's radio segment net revenue increased $14.0 million or 11% due to increases in local, network, and digital sales which were offset by a decrease in national sales. The Company's special events revenue increased primarily in its Los Angeles, New York and San Francisco markets. The Company's television segment net revenue increased $0.3 million or 2%, due to increases in local sales offset by a decrease in special event and subscriber based revenue. Consolidated net revenue excluding political, a non-GAAP measure, totaled $156.0 million compared to $137.5 million for the same prior year period, resulting in an increase of 13%. Consolidated Adjusted OIBDA, a non-GAAP measure, totaled $51.3 million compared to $50.1 million for the same prior year period, resulting in an increase of $1.2 million or 2%. The Company's radio segment Adjusted OIBDA increased 7%, primarily due to the increase in net revenue of $14.0 million which was partially offset by the increase in operating expense of approximately $9.9 million. Radio station operating expenses increased mainly due to the absence of a prior year positive impact of legal settlements in addition to increases in special events, compensation and benefits, barter, commissions and music license fees, which were partially offset by decreases in professional fees, affiliate station compensation and an increase in production tax credits. The Company's television segment Adjusted OIBDA decreased $1.6 million or 33%, due to the increase in operating expenses of $1.9 million and partially offset by an increase in net revenue of $0.3 million. Television station operating expenses increased primarily due to increases in production costs, barter, and commission expenses which were partially offset by a decrease in special events expenses and an increase in production tax credits. The Company's corporate expenses, excluding non-cash stock-based compensation, increased approximately 12% primarily due to increases in compensation and insurance expenses partially offset by a decrease in professional fees. Consolidated Adjusted OIBDA excluding political, a non-GAAP measure, totaled $50.7 million compared to $45.6 million for the same prior year period, representing an increase of 11%. Operating income totaled $38.6 million compared to $51.6 million for the same prior year period, representing a decrease of $13.0 million or 25%. This decrease in operating income was primarily due to the prior year recognition of gain on sale of assets and the current year increases in operating expenses, executive severance expenses and recapitalization costs partially offset by an increase in net revenue and not recognizing an impairment charge in the current period. Discussion and Results "As our release demonstrates, we delivered outstanding Q4 results which, in turn, contributed to our best annual financial showing in over 15 years," commented Raul Alarcon, chairman and CEO. "All business units including radio, television, experiential and interactive exhibited sustained increases with our core radio operation ranked among the leaders in the industry in ratings, revenue, SOI and margin growth." "In addition, fiscal 2020 started off exceptionally well and, as a result, we're confident of a strong rebound later in the year as our industry, our nation and the world eventually recover from the effects of the COVID-19 pandemic. For now, we are adapting operationally, financially and strategically at all levels and in all markets during this interim period so as to protect our personnel while continuing to inform, entertain and serve audiences and advertisers in anticipation of a surging demand for ad inventory and rescheduled live events as the year progresses." "In the meantime, we're adopting an old motto that has served American businesses extremely well since the beginning of the 19th century: 'We're Open for Business.'" Quarter Ended Results For the quarter-ended Dec. 31, 2019, consolidated net revenue totaled $46.1 million compared to $39.6 million for the same prior year period, resulting in an increase of 16%. The Company's radio segment net revenue increased 15% due to increases in local, special events, network, and digital which were partially offset by a decrease in national sales. The Company's television segment net revenue increased 31%, due to the increase in local sales which were partially offset by decreases in national sales. Consolidated net revenue excluding political, a non-GAAP measure, totaled $45.8 million compared to $36.9 million for the same prior year period, resulting in an increase of 24%. Consolidated Adjusted OIBDA, a non-GAAP measure, totaled $20.1 million compared to $17.4 million for the same prior year period, representing an increase of $2.7 million or 16%. The Company's radio segment Adjusted OIBDA increased 17%, primarily due to the increase in net revenue of approximately $5.2 million partially offset by an increase in operating expenses of $2.2 million. Radio station operating expenses increased mainly due to increases in special events expenses, professional fees, compensation, and music license fees expenses, which were partially offset by a decrease advertising expenses. The Company's television segment Adjusted OIBDA increased approximately $0.6 million, due to increase in net revenue of approximately $1.3 million partially offset an increase in operating expenses of approximately $0.7 million. Television station operating expenses increased primarily due to increases in production costs, barter expense and taxes and license fees. The Company's corporate expenses, excluding non-cash stock-based compensation, increased $0.9 million or 36%, mostly due to increases in compensation, insurance and professional fees. Consolidated Adjusted OIBDA excluding political, a non-GAAP measure, totaled $19.8 million compared to $14.9 million for the same prior year period, representing an increase of 33%. Operating income totaled $17.3 million compared to $14.3 million for the same prior year period, representing an increase of approximately $3.0 million or 21%. This increase in operating income was primarily due to the increase in net revenue partially offset by the increase in operating expenses. Continued Recapitalization and Restructuring Efforts Spanish Broadcasting said, "We have not repaid our outstanding Notes since they became due on April 17, 2017, and we continue to evaluate all options available to refinance the Notes. While we assess how to best achieve a successful refinancing of the Notes, we have continued to pay interest on the Notes, payments that a group of investors purporting to own our Series B preferred stock have challenged through the institution of litigation in the Delaware Court of Chancery as described below. The complaint filed by these investors revealed a purported foreign ownership of our Series B preferred stock, which we are actively addressing, including before the Federal Communications Commission (the "FCC") in order to protect our broadcast licenses. Our refinancing efforts have been made more difficult and complex by the Series B preferred stock litigation and foreign ownership issue. On December 16, 2019, we announced in a press release that we had received a letter from a bank stating that it was highly confident of its ability to arrange secured debt financing for up to $300 million that, in combination with a possible additional first lien asset-based financing, would be used to repay our outstanding Notes and to make cash purchases of our Series B preferred stock. We cannot assure you that the bank will be successful in raising that financing, that we will be able to raise the additional contemplated first lien asset-based financing or that we will be able to reach agreement that will be acceptable to us. We provide more information about each of these items in our Annual Report on Form 10-K for the year ended December 31, 2019. "We have worked and continue to work with our advisors regarding a consensual recapitalization or restructuring of our balance sheet, including through the issuance of new debt or equity to raise the necessary funds to repay the Notes. The Series B preferred stock litigation and the foreign ownership issue have complicated our efforts at a successful refinancing of the Notes. The resolution of the recapitalization or restructuring of our balance sheet, the litigation with the purported holders of our Series B preferred stock and the foreign ownership issue are subject to several factors currently beyond our control. Our efforts to effect a consensual refinancing of the Notes, the Series B preferred stock litigation and the foreign ownership issue will likely continue to have a material adverse effect on us if they are not successfully resolved. On December 16, 2019, we announced in a press release that we had received a letter from a bank stating that it was highly confident of its ability to arrange secured debt financing for up to $300 million that, in combination with a possible additional first lien asset-based financing, would be used to repay our outstanding Notes and to make cash purchases of our Series B preferred stock. We cannot assure you that the bank will be successful in raising that financing, that we will be able to raise the additional contemplated first lien asset-based financing or that we will be able to reach agreement that will be acceptable to us. We face various risks regarding these matters which are summarized in our Annual Report on Form 10-K for the year ended December 31, 2019." A full-text copy of the Form 10-K is available for free at: https://is.gd/VTicvK About Spanish Broadcasting Spanish Broadcasting System, Inc. (SBS) -- http://www.spanishbroadcasting.com/-- owns and operates radio stations located in the top U.S. Hispanic markets of New York, Los Angeles, Miami, Chicago, San Francisco and Puerto Rico, airing the Tropical, Regional Mexican, Spanish Adult Contemporary, Top 40 and Urbano format genres. SBS also operates AIRE Radio Networks, a national radio platform of over 275 affiliated stations reaching 95% of the U.S. Hispanic audience. SBS also owns MegaTV, a network television operation with over-the-air, cable and satellite distribution and affiliates throughout the U.S. and Puerto Rico, produces a nationwide roster of live concerts and events, and owns a stable of digital properties, including La Musica, a mobile app providing Latino-focused audio and video streaming content and HitzMaker, a new-talent destination for aspiring artists. STAK DESIGN: Proposes Online Rosen Sale of Residual Assets ---------------------------------------------------------- Stak Design, Inc., asks the U.S. Bankruptcy Court for the Northern District of Texas to authorize the online auction sale of residual assets, including, but not limited to, certain furniture and equipment, computer software and hardware, and leasehold improvements. STAK has entered into an Asset Purchase Agreement with Spoon Exhibit Services, Inc. pursuant to which it will sell substantially all of its assets to Spoon on a going concern basis. The Property will be excluded from the sale to Spoon. STAK desires to sell the Property via online auction to the highest bidder free and clear of all liens, claims and encumbrances, with all liens, claims and encumbrances, if any, attaching to the sale proceeds. The auction will be conducted by Rosen Systems, Inc. in accordance with the United States Trustee's Guidelines. Rosen Systems will conduct the auction online through Rosen Systems' website at www.rosensystems.com. The bidding will open on March 10, 2020 at 9:00 a.m., and close at 10:00 a.m. on March 17, 2020. Inspection of the Property will take place on March 16, 2020, from 10:00 a.m. to 3:00 p.m. (or by appointment) at the Debtor's location at 407 113th Street, Arlington, TX 76011. Removal of the Property will be weekdays from March 19, 2020 to March 27, 2020 at 10:00 a.m. to 4:00 p.m. Sale of the Property in the auction is "as is, where is." STAK asserts that it is necessary and in the best interest of the estate and its creditors to liquidate the Property free and clear of liens and encumbrances through a public online auction. It asserts that the proposed sale will maximize the value to its estate. STAK asks that the Court waives the 14-day stay pursuant to Rule 6004(h) and authorizes the sale effective immediately upon entry of an order approving the Motion. A hearing on the Motion is set for March 16, 2020 at 1:30 p.m. The Objection Deadline is March 12, 2020. About Stak Design STAK Design, Inc. -- http://www.stakdesign.com/-- is a custom design, engineering, and manufacturing firm. The Company works directly with architects, designers, developers, and general contractors for custom millwork, retail displays, kiosks, RMUs, specialty environments, and custom tradeshow exhibits. The Debtor filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 20-30424) on Feb. 4, 2020. In the petition signed by Stanley Zalenski, president, the Debtor was estimated to have between $500,000 and $1 million in assets and $1 million and $10 million in liabilities. Judge Harlin Dewayne Hale is assigned to the case. McGuire, Craddock & Strother, P.C., represents the Debtor. STAK DESIGN: Proposes Rosen Sale of Residual Assets --------------------------------------------------- Stak Design, Inc., asks the U.S. Bankruptcy Court for the Northern District of Texas to authorize the online auction sale of residual assets, including, but not limited to, certain furniture and equipment, computer software and hardware, and leasehold improvements. STAK has entered into an Asset Purchase Agreement with Spoon Exhibit Services, Inc. pursuant to which it will sell substantially all of its assets to Spoon on a going concern basis. The Property will be excluded from the sale to Spoon. STAK desires to sell the Property via online auction to the highest bidder free and clear of all liens, claims and encumbrances, with all liens, claims and encumbrances, if any, attaching to the sale proceeds. The auction will be conducted by Rosen Systems, Inc. in accordance with the United States Trustee's Guidelines. Rosen Systems will conduct the auction online through Rosen Systems' website at www.rosensystems.com. The bidding will open on March 17, 2020, at 9:00 a.m., and have a rolling close beginning at 10:00 a.m. on March 17, 2020, with one lot per minute closing until all lots are sold. Inspection of the Property will take place on March 16, 2020, from 10:00 a.m. to 3:00 p.m. (or by appointment) at the Debtor's location at 407 113th Street, Arlington, TX 76011. Removal of the Property will be weekdays from March 19, 2020, to March 27, 2020 at 10:00 a.m. to 4:00 p.m. Sale of the Property in the auction is "as is, where is." TAK asserts that it is necessary and in the best interest of the estate and its creditors to liquidate the Property free and clear of liens and encumbrances through a public online auction. It asserts that the proposed sale will maximize the value to its estate. A hearing on the Motion is set for March 16, 2020 at 1:30 p.m. The Objection Deadline is March 12, 2020. About Stak Design STAK Design, Inc. -- http://www.stakdesign.com/-- is a custom design, engineering, and manufacturing firm. The Company works directly with architects, designers, developers, and general contractors for custom millwork, retail displays, kiosks, RMUs, specialty environments, and custom tradeshow exhibits. The Debtor filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 20-30424) on Feb. 4, 2020. In the petition signed by Stanley Zalenski, president, the Debtor was estimated to have between $500,000 and $1 million in assets and $1 million and $10 million in liabilities. Judge Harlin Dewayne Hale is assigned to the case. McGuire, Craddock & Strother, P.C., represents the Debtor. SUNCREST STONE: April 16 Plan Confirmation Hearing Set ------------------------------------------------------ On March 5, 2020, debtors Suncrest Stone Products, LLC and 341 Stone Properties, LLC filed with the U.S. Bankruptcy Court for the Middle District of Georgia, Albany Division, a Disclosure Statement for Third Amended Joint Plan of Reorganization of the Debtors. On March 11, 2020, Suncrest Newstone Products, LLC (SNP) filed a Disclosure Statement for Amended Joint Plan of Reorganization of Suncrest Newstone. On March 13, 2020, Judge Austin E. Carter ordered that: * Debtors' Disclosure Statement is approved. * SNP's Disclosure Statement is approved. * The respective proponents of each Plan may now solicit acceptances of its respective Plan in accordance with 11 U.S.C. § 1125. * April 10, 2020, is the deadline for any objection to confirmation of either Plan. * April 16, 2020, at 9:30 a.m. in Courtroom B, United States Bankruptcy Court for the Middle District of Georgia, 433 Cherry Street, Macon, Georgia 31201 is the hearing to consider confirmation of each Plan and any objections to confirmation of each Plan. A full-text copy of the order dated March 13, 2020, is available at https://tinyurl.com/s73otmd from PacerMonitor at no charge. Counsel for Debtors: Matthew S. Cathey David L. Bury, Jr. 577 Mulberry Street – Suite 800 Macon, Georgia 31201 Tel: (478) 750-9898 Fax: (478) 750-9899 About Suncrest Stone Products Suncrest Stone Products, LLC -- https://www.suncreststone.com/ --is a stone supplier in Ashburn, Georgia. Its products include Ashlar, Country Ledge, Ledge, River Rock, Olde-Castle, Splitface, Stock, and Rubble. Suncrest Stone Products and 341 Stone Properties, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Ga. Lead Case No. 18-10850) on July 13, 2018. In the petition signed by Max Suter, authorized officer, Suncrest was estimated to have assets of less than $1 million and liabilities of $1 million to $10 million. 341 Stone was estimated to have $1 million to $10 million in assets and liabilities. Judge Austin E. Carter is the presiding judge. Stone & Baxter, LLP, is the Debtors' counsel. McMurry Smith & Company is the accountant. Crumley and Associates Inc. d/b/a South Georgia Appraisal Company is appraiser to the Debtor. SUNCREST STONE: Unseccureds Owed $360K to Get $200K in Plan ----------------------------------------------------------- Debtors Suncrest Stone Products, LLC, and 341 Stone Properties, LLC filed a Third Amended Joint Plan of Reorganization and a Disclosure Statement on March 12, 2020. This Plan provides that the allowed claims of the Debtors' creditors will be paid from the sale or surrender and assignment of collateral and from Debtors' future income, new capital, and distributions, if any, from the Creditors Trust, but with a guarantee to Trust participants of $175,000. Holders of Class 9 unseccured claims each amounting to $750 or less and claims voluntarily reduced to $750 will recover 100%. The Allowed Unsecured Claims in Class 10 are anticipated to total approximately $360,267. Holders of Allowed Claims in Class 10 may elect one of the following options: * Option 1: Holders of Allowed Unsecured Claims in Class 10 may elect to reduce their claim to $750 and participate as an Allowed Claim in Class 9. * Option 2: Holders of Allowed Claims in Class 10 who do not elect Option 1 shall be paid as follows: -- First, they shall receive from Reorganized Debtor Suncrest Stone their pro-rata share, based on the amount of their Allowed Unsecured Claim, of $25,000, which share Reorganized Debtor Suncrest Stone shall pay, without interest, within 14 days following the Effective Date; -- Second, Reorganized Debtor Suncrest Stone will, within 90 days after the Effective Date, transfer to the Creditors Trust (i) all Causes of Action and (ii) cash in the amount of $25,000 to fund initial Litigation Costs of the Creditors Trust (defined in the Plan as the "Creditor Trust Expense Payment"), with Holders of Allowed Unsecured Claims in Classes 7 and 10 being the Beneficiaries of such Trust (collectively, the "Beneficiaries"). Over the term of the Creditors Trust, Beneficiaries will be paid, on account of their Beneficial Interests, in total, the greater of (i) their pro-rata share, based on the amount of their Allowed Unsecured Claim, of $175,000 (the "Trust Guarantee," which Trustee Guarantee the Reorganized Debtor Suncrest Stone will guarantee the payment of and contribute to the Creditors Trust on an evergreen basis in amounts and with timing sufficient to satisfy the Trust Guarantee) and (ii) the Trust Proceeds. A full-text copy of the Third Amended Joint Plan dated March 12, 2020, is available at https://tinyurl.com/sjpzxoc from PacerMonitor at no charge. The Debtors are represented by: Matthew S. Cathey David L. Bury, Jr. Stone & Baxter, LLP Suite 800, Fickling & Co. Building 577 Mulberry Street Macon, Georgia 31201 About Suncrest Stone Products Suncrest Stone Products, LLC -- https://www.suncreststone.com/ --is a stone supplier in Ashburn, Georgia. Its products include Ashlar, Country Ledge, Ledge, River Rock, Olde-Castle, Splitface, Stock, and Rubble. Suncrest Stone Products and 341 Stone Properties, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Ga. Lead Case No. 18-10850) on July 13, 2018. In the petition signed by Max Suter, authorized officer, Suncrest estimated assets of less than $1 million and liabilities of $1 million to $10 million. 341 Stone estimated $1 million to $10 million in assets and liabilities. Judge Austin E. Carter is the presiding judge. Stone & Baxter, LLP, is the Debtors' counsel. McMurry Smith & Company is the accountant. Crumley and Associates Inc. d/b/a South Georgia Appraisal Company is appraiser to the Debtor. TARONIS TECHNOLOGIES: Delays Filing of Annual Report Over COVID-19 ------------------------------------------------------------------ Taronis Technologies, Inc., will be unable to meet the filing deadline for its Annual Report on Form 10-K due to circumstances related to COVID-19. The Company said it has been unable to overcome the burden of limited access to its facilities and support staff as a result of COVID-19. The Company's staff has been mandated to work from home, which has resulted in unforeseen delays and inefficiencies in the preparation of the Annual Report. Additionally, the Company has been forced to lay off certain members of its accounting staff due to Company-wide cutbacks stemming from harsh economic conditions related to COVID-19, which has further delayed the preparation of its Annual Report. The Company is relying on the SEC order under Section 36 of the Securities Exchange Act of 1934, as amended, dated March 25, 2020 (Release No. 34-88465) to extend the due date for the filing of the 10-K until May 14, 2020 (45 days after the original due date). The Company will work diligently to comply with such requirement but, at this time, management believes that it will need most, if not all of, the available extension period. Supplemental Risk Factor The Company is supplementing the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the year ended Dec. 31, 2018 and its subsequent Quarterly Reports on Form 10-Q with the following risk factor: "Public health epidemics or outbreaks could adversely impact our business. "In December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. While initially the outbreak was largely concentrated in China and caused significant disruptions to its economy, it has now spread to several other countries and infections have been reported globally. The extent to which the coronavirus impacts our operations will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the outbreak, new information which may emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact, among others. In particular, the continued spread of the coronavirus globally could adversely impact our operations and could have an adverse impact on our business and our financial results." About Taronis Technologies Clearwater, Florida-based Taronis Technologies Taronis Technologies, Inc. (TRNX) is a technology-based company that is focused on addressing the global constraints on natural resources, including fuel and water. The Company's two core technology applications -- renewable fuel gasification and water decontamination/sterilization -- are derived from its patented and proprietary Plasma Arc Flow System. The Plasma Arc Flow System works by generating a combination of electric current, heat, ultraviolet light and ozone, that affects the feedstock run through the system to create a chosen outcome, depending on whether the system is in "gasification mode" or "sterilization mode". The Company operates 22 locations across California, Texas, Louisiana, and Florida. Taronis reported a net loss of $15.04 million in 2018 following a net loss of $11.02 million in 2017. As of Sept. 30, 2019, Taronis had $47.76 million in total assets, $11.49 million in total liabilities, and $36.27 million in total stockholders' equity. Marcum LLP, in New York, NY, the Company's auditor since 2016, issued a "going concern" qualification in its report dated April 12, 2019, citing that the Company has incurred significant losses, continued to have negative cash flows from its operating activities, and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. THERXSERVICES INC: April 23 Plan Confirmation Hearing Set --------------------------------------------------------- The U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, conducted a hearing to consider approval of the disclosure statement filed by Debtor TheRXServices, Inc. On March 17, 2020, Judge Catherine Peek McEwen conditionally approved the Disclosure Statement and established the following dates and deadlines: * Any written objections to the Disclosure Statement shall be filed no later than seven days prior to the date of the hearing on confirmation. * April 23, 2020, at 1:30 p.m. in Tampa, FL − Courtroom 8B, Sam M. Gibbons United States Courthouse, 801 N. Florida Avenue is the hearing on confirmation of the Plan, including timely filed objections to confirmation, objections to the Disclosure Statement, motions for cramdown, applications for compensation, and motions for allowance of administrative claims. * Parties-in-interest will submit their written ballot accepting or rejecting the Plan no later than eight days before the date of the Confirmation Hearing. * Objections to confirmation will be filed with the Court and served on the Local Rule 1007−2 Parties in Interest List no later than seven days before the date of the Confirmation Hearing. A full-text copy of the order dated March 17, 2020, is available at https://tinyurl.com/tzzsn55 from PacerMonitor at no charge. About TheRXServices Inc. TherxServices, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-10307) on Oct. 30, 2019. At the time of the filing, the Debtor was estimated to have assets of between $100,001 and $500,000 and liabilities of the same range. The Debtor tapped Buddy D. Ford, P.A. as its legal counsel, and Myers & Wright, P.A. as its accountant. THOMASRILEY STRATEGIES: Black Knight Buying Assets for $5K ---------------------------------------------------------- ThomasRiley Strategies, LLC, asks the U.S. Bankruptcy Court for the District of Columbia to authorize the private sale of all of its material assets, including the Subcontracts, as more fully set forth in the Asset Purchase Agreement, to Black Knight Medical, LLC for $5,000, ubject to higher and better offers. The primary assets of the Debtor are its executory contracts. ThomasRiley Strategies is a subcontractor on four contracts as more fully set forth in the APA. On Feb. 20, 2020, it entered into the APA with Black Knight for the sale of the APA Contracts. Under the Asset Purchase Agreement, in addition to the APA Contracts, Black Knight would acquire ThomasRiley Strategies' intellectual property and assets. Black Knight would acquire the Debtor's rights to perform and collect on its contracts in the name of ThomasRiley Strategies, and the fixed assets of the Debtor ("APA Sale Assets"). The purchase price set forth in the APA is $5,000. To complete the sale, Black Knight has escrowed earnest money in the amount of $5,000, to be held in the Trust Account of Stinson LLP, the Purchaser's law firm. The Debtor is a subcontractor on a variety of contracts. It has been informed that a number of the contracts it possessed at the start of the bankruptcy case will not be renewed due to the business decisions taken by its prime contractors. As a result, absent a sale of its assets, the Debtor will not be able to continue business operations. Black Knight is a related entity and in the Debtor's estimation, the only entity that would be likely to make an offer to purchase its assets. No appraised value for Subcontracts has been obtained. To ensure a fair and reasonable price, the Debtor has had a business valuation expert, William H. Arnold, CPA of Marcher Consultants, prepare a valuation report. Mr. Arnold's analysis is that a third party buyer would pay essentially a nominal price for these assets. As a result, the Debtor believes the $5,000 offer by Black Knight is a reasonable value to be paid for the assets of the company under the circumstances. The contracts purchased by Black Knight are compensated on an hourly basis. The parties anticipated the value of the contract and the payment to Black Knight is based on the company receiving most of the revenues after March 31, 2020. The Subcontracts, subject to the sale proposed in the Asset Purchase Agreement, decrease in value over time and a delay in finalizing the sale will result in reduced revenues available for collection. A reduction in funds from a delay in the sale will require the parties to adjust the cash paid to Black Knight Medical on account of the sale, making closing more difficult and decreasing funds that can be paid to ThomasRiley Strategies' other creditors. Black Knight has represented that it is unwilling to complete the transaction if closing does not occur before March 31, 2020 and a Court Order approving the proposed sale is not entered prior to that date. As a result, the inability to obtain approval of the sale before March 31, 2020 will cause immediate and irreparable injury to the Debtor and creditors of the bankruptcy estate. The Debtor asks that the Court approves the sale of the Subcontracts under the Asset Purchase Agreement, through a competing contract submitted before or on the hearing date, or as a result of any open auction the Court might conduct for the sale of the Subcontracts. Finally, the Debtor asks that the Court waives the 14-day stay required by Bankruptcy Rule 6004(h) in order to expedite the closing on the sale of the Subcontracts. A copy of the APA is available at https://tinyurl.com/rhaeuaz from PacerMonitor.com free of charge. About ThomasRiley Strategies ThomasRiley Strategies, LLC -- https://thomasrileystrategiesllc.net/ -- is a business management consultant headquartered in Washington, D.C. ThomasRiley Strategies sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.D.C. Case No. 19-00626) on Sept. 20, 2019. At the time of the filing, the Debtor had estimated assets of between $100,000 and $500,000 and liabilities of between $1 million and $10 million. The case is assigned to Judge Martin S. Teel, Jr. The Debtor is represented by Bradley D. Jones, Esq., at Odin, Feldman & Pittleman, P.C. TIERPOINT LLC: Fitch Affirms B- LT IDR & Alters Outlook to Positive ------------------------------------------------------------------- Fitch Ratings affirmed the Long-Term Issuer Default Rating for TierPoint, LLC at 'B-', following the company's announcement it will receive a $320 million preferred equity investment and amend/extend its revolver by three years through April 2025. Fitch expects net proceeds from the equity offering will be used to repay the second lien term loan ($220 million outstanding) and a portion of revolver borrowings ($109 million outstanding at December 2019). Fitch also affirms the first lien term loan and revolver at 'B'/'RR3' and plans to withdraw the second lien term loan rating upon completion of the deal and repayment of the debt. Fitch revised the Rating Outlook to Positive from Negative to reflect a more manageable financial leverage profile, increased operating flexibility and additional headroom under the upcoming amended credit agreement. While the current macroeconomic environment remains challenged due to the coronavirus, Fitch believes data center providers such as TierPoint will fare reasonably well due to underlying secular demand trends and the long-term, contractual nature of the business model. The IDR and security ratings affect approximately $900 million of debt, including the company's $220 million senior secured revolver. KEY RATING DRIVERS Coronavirus - Less Exposed, Not Immune: Fitch believes the data center industry will be much less impacted by the coronavirus versus other industries due to the long-term, contractual nature of the business model and strong underlying demand for data and communication services. However, the company could experience near-term negative impacts from elongated sales cycles or other potential deleveraging impacts from disruption among its own operations. Further, a prolonged period of economic pause in the U.S. leading to a recession could lead to weaker new sales and higher churn in the coming years. Equity Injection Benefits Leverage: Fitch views the March 2020 preferred equity injection of $320 million as a credit positive as the company indicated it will use net proceeds to repay its second lien term loan and most of its outstanding revolver balance. TierPoint's expansion strategy and private equity ownership structure led to elevated leverage ratios in recent years. Pro forma for the capital structure change, Fitch forecasts the company will operate with a more manageable gross debt/EBITDA in the low/mid-5.0x range in the coming years versus near 8.0x currently. Fitch believes the company is focused on improving organic trends and further integrating past deals in order to manage its leverage profile but this may prove challenging in a competitive industry. Capital Intensive Business: TierPoint operates in a competitive and capital intensive industry, and it must continue to invest in order to maintain customers and drive growth. Fitch does not expect this dynamic to change over the ratings horizon and limits the company's ability to materially deleverage, absent EBITDA expansion and/or additional equity contributions. The preferred equity contribution benefits near-term liquidity, but Fitch expects the company to remain reliant on its revolver to support capex needs in the future. Capex ranged from 20%-30% of sales per year over the past few years, and Fitch expects elevated levels of spend will continue to drive negative FCF through 2022. Secular Growth in Data Centers: Data center (DC) demand increased significantly over the past decade driven by factors such as global internet adoption, increased smartphone usage, and enterprise outsourcing. Fitch believes these market forces will continue to drive growth for DC providers in the coming years. Cisco projects annual global data center IP traffic to triple to 20.6 zettabytes (Zb) and DC storage to quadruple to 2.6 Zb between 2016 and 2021. For context, a zettabyte is a billion terrabytes. Fitch believes DC traffic growth, combined with an increasingly positive enterprise sentiment toward hybrid deployments, could favor carrier-neutral DC providers such as TierPoint. Fragmented and Competitive Market: Despite a favorable demand backdrop, the fragmented nature of the DC industry keeps it susceptible to pricing pressure and excess capacity from new builds. Oversupply remains a key risk to consider for TierPoint given large amounts of capital being spent in the industry at increasingly high valuations. In addition to industry supply risks, hyperscale/cloud providers represent a material competitive threat. Cloud providers such as Amazon's AWS and Microsoft's Azure are witnessing substantial growth and could over time threaten the core value proposition for traditional DC providers. Diversified Customer Base: TierPoint operates 41 facilities in 20 markets and serves approximately 4,000 customers, with its largest customer at near 2% of monthly recurring revenue (MRR). This results in a fragmented customer base with its top 25 customers comprising only 17% of MRR. The fragmented customer base reduces customer concentration risk and earnings volatility. Fitch views this favorably as it enhances predictability of the company's future financial performance. Additionally, TierPoint strategically targets secondary markets where competition is less intense and focuses on small to medium sized enterprises (SMEs). High Proportion of Recurring Revenue: Approximately 98% of the company's revenue is recurring in nature with typical service contracts extending for three years, creating a high level of visibility into future revenue streams. DC customers tend to look for long-term stability as IT infrastructure is critical for enterprises and there are some switching costs, albeit less so than five or 10 years ago. This results in a lengthy sales cycle and fairly sticky customer base, as evidenced by average monthly churn of 0.9%-1.7% from 2016 through 2019. Shift to Managed Services: TierPoint generates 50% of its total revenue from retail colocation but the mix has shifted to more managed services since 2015. Management is strategically shifting toward managed hosting and cloud services as it encompasses a larger part of the industry value chain and attracts a larger set of potential customers. The increased exposure to a greater part of the value chain is expected to increase customer stickiness. A greater mix of managed cloud services is also projected to increase capital efficiency as it tends to be less capital intensive. Fitch believes this mix shift provides some diversification beyond colocation but it is unclear the margin impact over time. ESG Influence: TierPoint has an ESG Relevance Score of 4 for Governance Structure due to its current ownership structure whereby private equity holders have meaningful board influence, resulting in management's choice to pursue high leverage, a key factor in its rating analysis. DERIVATION SUMMARY TierPoint's ratings and Outlook reflects strong secular trends in the DC industry, offset to a certain extent by high leverage, a capital intensive business model, and competitive trends. Fitch's Positive Outlook reflects the deleveraging impact from the recently announced equity investment and encouraging signs of operating improvement during 2019 and early 2020. The announced preferred equity investment provides the company additional flexibility to navigate in the next few years. Tierpoint, like most companies, will not be immune from the impact of the coronavirus. However, Fitch believes the data center industry will be much less impacted than other areas of the economy. Fitch's ratings are supported by its view that the DC industry will benefit over the next several years from growth in data usage and continued outsourcing of internal IT needs. This secular tailwind provides a positive operating backdrop for TierPoint. Offsetting positive industry demand trends is margin compression since 2015 and spotty execution. Margins stabilized and improved in 2019, but the company will need to show continued improvement over the next several years. The DC space comprises a range of players including wholesale providers such as Digital Realty, retail colocation providers such as Equinix that offer a smaller footprint and shorter lease terms, cloud service providers such as Amazon's AWS, and managed hosting vendors such as Rackspace Hosting. TierPoint provides both retail colocation and managed services, the latter of which has become a bigger piece of its business through both M&A and organic growth. Relative to some of its larger peers, TierPoint targets secondary U.S. markets where competition is less severe and focuses on SMEs in these markets. Fitch believes competition will remain intense in the segment, and Fitch would look for sustained execution as well as a prudent approach to managing cash flows. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- Revenue: organic growth in the mid-single-digit percentage range over the ratings horizon, with higher growth in Managed Services versus Colocation; -- EBITDA: margins improve modestly to the mid-30% range in the next few years versus approximately 34% in 2019; -- Capex: remains at 25%-30% of revenue, as the company continues to invest in its portfolio and expand its capacity. -- Debt/leverage: assumed gross debt/EBITDA remains high in the 5.0x-5.5x range over the ratings horizon. -- Recovery: For entities rated 'B+' and below - where default is closer and recovery prospects are more meaningful to investors Fitch undertakes a tailored, or bespoke, analysis of recovery upon default for each issuance. The resulting debt instrument rating includes a Recovery Rating or published 'RR' (graded from 'RR1' to 'RR6'), and is notched from the IDR accordingly. In this analysis, there are three steps: (i) estimating the distressed enterprise value (EV); (ii) estimating creditor claims; and (iii) distribution of value. Fitch assumed Tierpoint would emerge from a default scenario under the going concern approach versus liquidation. Key assumptions used in the recovery analysis are as follows: (i) going concern EBITDA of approximately $114 million, which is 15% TTM EBITDA of $134 million and assumes the company experiences elevated churn and/or competitive pressures that lead to margin compression, and (ii) emergence EV to EBITDA multiple of 6.0x, which Fitch derives from comparable public company trading multiples, historical valuations in the space, industry M&A and comparable reorganization multiples Fitch has seen in the technology, media and telecommunications industries. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Positive Rating Action -- TierPoint shows sustained improvement in operating fundamentals, including consistent mid-single-digit or higher revenue and/or EBITDA growth; -- Gross leverage, Fitch-defined as total debt with equity credit/operating EBITDA, expected to be sustained near 5.5x or below; -- FCF generation trends toward consistent break-even or positive. Developments That May, Individually or Collectively, Lead to Negative Rating Action -- Fitch could stabilize the rating at the current IDR if fundamentals deteriorate and/or Fitch expects gross leverage to be sustained at 6.0x or higher; -- Fitch could consider a downgrade if gross leverage is expected to be sustained near 7.0x or higher; -- If access to liquidity sources deteriorate, including a majority of revolving facilities being utilized and/or interest coverage declining to mid-1.0x or below, this could also lead to a downgrade. BEST/WORST CASE RATING SCENARIO Ratings of Non-Financial Corporate issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. LIQUIDITY AND DEBT STRUCTURE Liquidity Tied to External Capital: Liquidity risk is alleviated by the equity infusion but remains, as the company continues to rely on its revolver to fund its operations. Pro forma for the preferred equity transaction, the company will still have more than $30 million outstanding on its $220 million revolver. TierPoint's liquidity profile has been pressured by its consistently negative FCF, causing the company to fund deficits with its revolver. The company reported a FCF burn of $42 million in 2019, $46 million in 2018, and $215 million cumulatively since 2015. Fitch believes the company is targeting break-even or positive FCF, but this may prove challenging to sustain given the capital intensive nature of the DC industry. Debt Structure: All of TierPoint's debt consists of credit facilities including: (i) a $220 million revolving credit facility (with the potential to be upsized) that will terminate in May 2022 (the company is seeking an extension to April 2025) and (ii) a $700 million first lien term loan maturing in May 2024. As part of the planned amend/extend of its revolver, the company is also seeking to modify the financial covenant to a maximum total net leverage of 7.25x versus the current total first lien net leverage covenant of 6.25x. The current $220 million second lien term loan maturing in May 2025 will be paid off with proceeds from the preferred equity investment. There are no near-term maturities and only minimal amounts of amortization payments in the coming years. Thus, there is limited maturity and/or refinancing risk in the near term. However, liquidity risk is high as the company continues to rely on its revolver to fund its operations. Fitch's treatment of preferred equity varies by type. In the case of TierPoint's planned preferred issuance, the preferred equity is outside of the restricted group (which includes the borrower, TierPoint, LLC) and includes both affiliated and unaffiliated investors. While a portion of the preferred equity will have a cash interest component, Fitch views the preferred equity as not debt of the rating entity as it does not possess typical attributes that would lead us to include as debt and is only senior to common equity. REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. ESG CONSIDERATIONS Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of 3 - ESG issues are credit neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. TierPoint has an ESG Relevance Score of 4 for Governance Structure due to its current ownership structure whereby private equity holders have meaningful board influence, resulting in management's choice to pursue high leverage, a key factor in its rating analysis. U.S. STEEL: Moody's Cuts CFR to Caa1 & Alters Outlook to Negative ----------------------------------------------------------------- Moody's Investors Service downgraded United States Steel Corporation's Corporate Family Rating to Caa1 from B2, its Probability of Default rating to Caa1-PD from B2-PD and its senior unsecured ratings, including all Industrial Revenue Bond Ratings to Caa2 from B3. The Speculative Grade Liquidity Rating was downgraded to SGL-3 from SGL-2. The outlook has been revised to negative from stable. "The rating downgrade reflects U. S. Steel's weaker debt protection measures than expected and increase in leverage to 6.7x in 2019 from 2.2x the prior year due to difficult market conditions and a weak price environment as well as the increase in debt to fund strategic investments, including the acquisition of a 49.9% interest in Big River Steel. Performance and metrics will further weaken in 2020 as a result of further softening in demand amidst expectations for lower GDP as the coronavirus spreads globally" said Carol Cowan Moody's Senior Vice President and lead analyst for U. S. Steel. Downgrades: Issuer: Allegheny County Industrial Dev. Auth., PA Senior Unsecured Revenue Bonds, Downgraded to Caa2 (LGD4) from B3 (LGD4) Issuer: Bucks County Industrial Development Auth., PA Senior Unsecured Revenue Bonds, Downgraded to Caa2 (LGD4) from B3 (LGD4) Issuer: Hoover (City of) AL, Industrial Development Board Senior Unsecured Revenue Bonds, Downgraded to Caa2 (LGD4) from B3 (LGD4) Issuer: Indiana Finance Authority Senior Unsecured Revenue Bonds, Downgraded to Caa2 (LGD4) from B3 (LGD4) Issuer: Ohio Water Development Authority Senior Unsecured Revenue Bonds, Downgraded to Caa2 (LGD4) from B3 (LGD4) Issuer: Southwestern Illinois Development Authority Senior Unsecured Revenue Bonds, Downgraded to Caa2 (LGD4) from B3 (LGD4) Issuer: United States Steel Corporation Probability of Default Rating, Downgraded to Caa1-PD from B2-PD Speculative Grade Liquidity Rating, Downgraded to SGL-3 from SGL-2 Corporate Family Rating, Downgraded to Caa1 from B2 Senior Unsecured Conv./Exch. Bond/Debenture, Downgraded to Caa2 (LGD4) from B3 (LGD4) Senior Unsecured Regular Bond/Debenture, Downgraded to Caa2 (LGD4) from B3 (LGD4) Outlook Actions: Issuer: United States Steel Corporation Outlook, Changed to Negative from Stable RATINGS RATIONALE This rating action is based upon the impact of the coronavirus, which is viewed as a social risk under its ESG framework, given the substantial implications for public health and safety. The impact of the coronavirus on the end markets to which U.S. Steel sells will meaningfully impact the company's earnings and cash flow generation in 2020 following the weaker performance in 2019. The Caa1 CFR reflects the deterioration in performance and metrics that occurred in 2019, as prices declined on a quarterly basis with 4th quarter realized prices for North America flat-rolled down 12% from the 1st quarter, USSE down approximately 7% and tubular down around 16% all on a comparable quarter to quarter basis. Difficult market conditions in Europe, where the PMI remained below 50 for most of 2019, auto production declined, and the steel markets were challenged by imports resulted in USSE's segment EBITDA declined to $35 million. In the US, declining rig counts, softening in light vehicle production and general flat to down industrial demand contributed to the North American Flat-Rolled segment's EDITDA dropping 48% to $652 million while the Tubular segment EBITDA's loss widened to $21 million against weak market conditions, and industry high inventory levels from increased imports of OCTG despite lower imports overall. The first quarter of 2020 will remain weak while the second quarter will be further challenged given deteriorating economic conditions and temporary plant closures by US and European auto producers, important end markets for U. S. Steel. The duration of closures could extend longer than anticipated. With slowing economic activity, back up in the supply chains is also expected. Given expectations for EBITDA generation in 2020 to decline between 25% and 44% relative to 2019 ($740 million with Moody's standard adjustments) leverage is likely to exceed 10x. Given the further deterioration in market conditions unfolding in 2020, the company will immediately idle the Gary #4 blast furnace and begin to undertake the planned outage at a reduced scope and delay components of the originally planned outage. This blast furnace will remain idle until market conditions improve. In addition, Blast Furnace A at Granite City works will be temporarily idled. The Lorrain Tubular Operations in Ohio and Lone Star Tubular Operations in Texas. Will be indefinitely idled commencing in late May. Additionally, in order to minimize cash flow, burn and maintain liquidity, capital spending in 2020 will be reduced to $750 million. Construction at the Mon Valley Works will be delayed, as will upgrades to the Gary Hot Strip Mill, while the Dynamo line development at USSE remains delayed. The company expects to complete the EAF at Fairfield with the first arc expected in the second half of 2020. The capital for this project was prefunded with the issuance of environmental revenue bonds in late 2019. This reduction in capital expenditures will minimize the level of negative cash flow generation, which based upon its assumed EBITDA decline, would be less than $500 million. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The steel sector is a sector that will be affected by the shock given its sensitivity to end market demand, such as automotive, OCTG, general manufacturing and sentiment. More specifically, the weaknesses in U. S. Steel's credit profile following a challenging 2019 have left it more vulnerable to shifts in market sentiment in these unprecedented operating conditions. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The SGL-3 speculative grade liquidity rating reflects the company's adequate liquidity with cash reducing to $749 million and $600 million drawn at year-end 2019 under its $2.0 billion asset based revolving credit facility (ABL), which contains a $150 million first in-last out tranche. U. S. Steel also had $190 million in restricted cash, largely reflecting the issuance of IRB's in 2019 for funding of the EAF at Fairfield. Liquidity has been bolstered by the drawdown of a further $800 million under U. S. Steel's ABL to enhance its cash position. The extent to which the value of inventory and receivables in the borrowing base contract remains a risk to remaining availability. The facility requires the company to maintain a fixed charge coverage ratio for the most recent four consecutive quarters should availability be less than the greater of 10% of the total aggregate commitment and $200 million. The fixed charge coverage ratio allows for certain exclusions such as certain capital expenditures. The facility matures in October 2024 but can be accelerated 91 days prior to the maturity of any senior debt outstanding if certain liquidity conditions are not met. With the company's debt repayments in recent years, there are no senior note maturities until 2025, subsequent to the maturity date of the ABL. There is also a Euro 460 million ($517 million equivalent at year-end December 31,2019) secured credit facility (receivables and inventory) at the company's U. S. Steel Kosice (USSK) subsidiary in Europe, which matures in December 2024. Euro 350 million (roughly $393 million was outstanding at December 31, 2019). The facility contains a net debt/EBITDA covenant for which the first measurement date is June 30, 2021 and a further covenant requiring that total equity be no less than 40% of total assets The negative outlook assumes that demand fundamentals for the steel industry in the US and Europe remain vulnerable to further deterioration in demand of uncertain duration and downward price trends. The outlook expects increased leverage and weaker debt protection metrics absent levers the company has to minimize negative cash flow and maintain adequate liquidity. Factors that would lead to an upgrade or downgrade of the ratings: Given the uncertainty as to the duration of weakening global conditions as well as the significant investment requirements over the next several years and need to execute on these strategic projects, a ratings upgrade is unlikely. However, should market conditions improve such that higher prices are sustainable, and the company can sustain leverage of no more than 4.5x through varying price points on the downside and (CFO-dividends) in excess of 10%, positive ratings momentum could develop. Should liquidity deteriorate or access to the ABL be reduced due to an imbalance between the size of the facility and the borrowing base, the ratings could be downgraded. U. S. Steel, like all producers in the global steel sector faces pressure to reduce greenhouse gas and air pollution emissions, among a number of other sustainability issues and will likely incur costs to meet increasingly stringent regulations. As such, the company faces longer term secular challenges in the ongoing shift away from blast furnace steelmaking to EAFs. U. S. Steel and companies who produce steel using the blast furnace process (integrated producers -use primarily coal and iron ore to produce steel) have higher greenhouse gas emissions and face greater challenges than producers who use the electric arc furnace (EAF), which have a greater percentage of scrap (recycled steel) in the raw material mix. Additionally, with the move to increasingly higher CAFE standards, producers supplying the automotive industry face increasing competition from other materials such as aluminum. U. S. Steel continues to focus on its Advanced High- Strength Steel product development to help mitigate against this market erosion. The increasing use of debt in the capital structure, while for key strategic initiatives indicates a higher tolerance for leverage in the capital structure. Headquartered in Pittsburgh, Pennsylvania, U. S. Steel is the second largest flat-rolled producer in the US in terms of production capacity. The company manufactures and sells a wide variety of steel sheet, tubular and tin products across a broad array of industries, including service centers, transportation, appliance, construction, containers, and oil, gas and petrochemicals. Revenues for the twelve months ended December 31, 2019 were $12.9 billion. UNIT CORP: John Cromling to Retire as EVP of Unit Drilling ---------------------------------------------------------- John Cromling gave notice to Unit Corporation of his intent to retire as executive vice president of Unit Drilling Company, the company's wholly-owned contract drilling subsidiary. Mr. Cromling's retirement is expected to take effect on July 31, 2020. The Company said Mr. Cromling's retirement is not the result of any disagreement with the company or Unit Drilling Company. On Mr. Cromling's retirement, David T. Merrill, chief operating officer of the company, commented, "I would like to thank John for his outstanding dedication and many contributions to Unit Drilling Company's success. He has provided great leadership and a wealth of industry knowledge gained through a career spanning nearly half a century. We wish John and his family all the best in the years to come." About Unit Corporation Unit Corporation -- http://www.unitcorp.com/-- is a Tulsa-based, publicly held energy company engaged through its subsidiaries in oil and gas exploration, production, contract drilling, and gas gathering and processing. Unit's Common Stock is listed on the New York Stock Exchange under the symbol UNT. Unit Corporation reported a net loss attributable to the company of $553.88 million for the year ended Dec. 31, 2019, compared to a net loss attributable to the company of $45.29 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $2.09 billion in total assets, $260.05 million in total current liabilities, $663.22 million in long-term debt less debt issuance costs, $27,000 in non-current derivative liabilities, $2.07 million in operating lease liability, $95.34 million in other long-term liabilities, $13.71 million in deferred income taxes, and $1.05 billion in total shareholders' equity. PricewaterhouseCoopers LLP, in Tulsa, Oklahoma, the Company's auditor since 1989, issued a "going concern" qualification in its report dated March 16, 2020, citing that the Company has incurred significant losses, is in a negative working capital position, and does not anticipate that forecasted cash and available credit capacity will be sufficient to meet their commitments over the next twelve months, which raises substantial doubt about its ability to continue as a going concern. * * * As reported by the TCR on Nov. 15, 2019, Moody's Investors Service downgraded Unit Corporation's Probability of Default Rating to Ca-PD from B3-PD, Corporate Family Rating to Caa1 from B3, and senior subordinated notes to Caa2 from Caa1. The downgrade of the PDR reflects Unit's proposed debt exchange offer, which Moody's views to be a distressed exchange. The Caa1 CFR and Caa2 rating on the 2021 notes reflect Moody's view on expected recovery, which is likely to be in the 80%-90% range. Prior to the exchange offer, Unit was contending with depressed commodity prices, looming maturities in a challenged refinancing environment and declining cash flow, Moody's said. As reported by the TCR on Jan. 21, 2020, Fitch Ratings downgraded the Long-Term Issuer Default Rating of Unit Corporation to 'CC' from 'CCC+'. Fitch's downgrade and watch reflect the company's heightened refinancing and liquidity risks associated with pro-longed operational deterioration since its bond exchange announcement. UNITED STATES OF AMERICA RUGBY: Case Summary & Unsecured Creditors ------------------------------------------------------------------ Debtor: United States of America Rugby Football Union, Ltd. 2655 Crescent Dr, Suite A Lafayette, CO 80026-3373 Case No.: 20-10738 Business Description: Founded in 1975, the Debtor is the national governing body for the sport of rugby in America, a Full Sport Member of the United States Olympic and Paralympic Committee, and World Rugby. USA Rugby oversees four national teams, multiple collegiate and high school All-American sides, and an emerging Olympic development pathway for elite athletes. Currently headquartered in Lafayette, Colorado, USA Rugby is charged with developing the game on all levels and has over 120,000 active members. USA Rugby was organized as a non-profit Delaware corporation on Jan. 25, 1978, and is governed by a Board of Directors, which in turn are overseen by the Congress, which represents the interests of its members. Chapter 11 Petition Date: March 31, 2020 Court: United States Bankruptcy Court District of Delaware Debtor's Counsel: Mark M. Billion, Esq. BILLION LAW 1073 S. Governors Ave Dover, DE 19904-6901 Tel: 302-428-9400 E-mail: markbillion@billionlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Ross Young, CEO. A copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/VCB8Od USREDA LLC: Bankruptcy Case Converted to Chapter 7 -------------------------------------------------- At the behest of Sonya Salkin-Slott, the U.S. Bankruptcy Court in the Southern District of Southern Florida has converted the Chapter 11 bankruptcy case of United States Regional Economic Development Authority, LLC, to liquidation proceedings under Chapter 7 of the Bankruptcy Code. Nancy Gargula, the United States Trustee for Region 21, appointed Sonya Salkin-Slott as Chapter 11 Trustee of United States Regional Economic Development Authority, LLC. Salkin-Slott later sought conversion of the case. Counsel for the U.S. Trustee consulted with these parties-in-interest regarding the appointment of Salkin-Slott: a. Philip Landau, Esq., Counsel for 160 Royal Palm, LLC, which filed the involuntary petition to place the Debtor in bankruptcy; and b. David Baddley, Esq., Counsel for the Securities and Exchange Commission In seeking conversion of the case, Salkin-Slott is of the opinion, after considering and reviewing (i) the information provided by counsel for the Petitioning Creditor and other interested parties; (ii) the Petitioning Creditor Bankruptcy Court file; (iii) the Trustee Motion; (iv) SEC Case; (v) EB-5 Case; and (iv) various other sources, that there is no business to reorganize and therefore no need to incur the administrative costs of a Chapter 11. The Trustee has identified no meaningful benefit to creditors in maintaining this case as a Chapter 11. About United States Regional Economic Development Authority United States Regional Economic Development Authority, LLC is a Delaware limited liability company located in Royal Palm Beach, Fla. USREDA is a global processor of investment-based immigration, and offers diversified investment opportunities. USREDA (Bankr. S.D. Fla. Case No. 19-25780) and its affiliates, South Atlantic Regional Center, LLC (Bankr. S.D. Fla. Case No. 19-25762), United States Regional Economic Development Authority, Inc. (Bankr. S.D. Fla. Case No. 19-25799) and Connect Insurance Group, Inc. (Bankr. S.D. Fla. Case No. 19-25767), were subject to involuntary Chapter 11 petitions filed by 160 Royal Palm, LLC in November 2019. The petitioning creditor is represented by Shraiberg, Landau & Page, P.A. Judge Erik P. Kimball oversees USREDA's case. Sonya Slott was appointed as Chapter 11 trustee for USREDA. Genovese Joblove & Battista, P.A. is the trustee's legal counsel. VESTAVIA HILLS: Commonwealth Assisted Living's Suit Goes to Calif. ------------------------------------------------------------------ Bankruptcy Judge D. Sims Crawford granted defendant Vestavia Hills Ltd. d/b/a Mount Royal Towers' motion to transfer venue to the United States District Court for the Southern District of California of the case captioned Commonwealth Assisted Living, LLC, Series E, Plaintiff, v. Vestavia Hills, Ltd. d/b/a Mount Royal Towers, Defendant, A.P. No. 20-00004-DSC (Bankr. N.D. Ala.). This case was referred to the Alabama Bankruptcy Court from the United States District Court for the Northern District of Alabama. It is a breach of contract and declaratory judgment action that was originally commenced by Commonwealth in the Circuit Court of Jefferson County, Alabama, where it was litigated for some 13-plus months before its removal to the District Court. Upon removal to the District Court, the parties moved to invoke the amended General Order of Reference and the case was referred to the Alabama Bankruptcy Court. Essentially, the case is about the attempted sale of Mount Royal Towers, a senior living community in Vestavia Hills, Alabama. In response to Vestavia Hills's post-bankruptcy removal of the State Court Action to the District Court, Commonwealth filed the Motion to Remand and/or for Abstention. Commonwealth perceives the removal as the "latest attempt to move this proceeding out of the State Court and/or delay the State Court case from moving forward." Moreover, it argues that equitable considerations warrant remand and, if not remand, factors exist requiring mandatory and permissive abstention. Vestavia Hills argues that because the action is related to the chapter 11 case pending before the California Bankruptcy Court, it should be transferred in the interest of justice and in deference to the "home court presumption," which presumes that cases related to bankruptcy proceedings should be litigated in the court where the bankruptcy case is pending. The Bankruptcy Court finds that allowing the home bankruptcy court in California to rule on the remand and abstention motion is the best course. The avoidance of piecemeal litigation and minimizing the risk of conflicting judgments are of paramount concern to this Court, as they were to the District Court. Transfer safeguards against the undesirable consequences of having too many courts in the kitchen. According to Judge Crawford, the Bankruptcy Court must determine which court should decide the State Court Action and when -- whether the home bankruptcy court in California or the local bankruptcy court in Alabama decide the removed case or whether the case be equitably remanded or whether abstention appropriate. Answers to these questions involve considerations of the "effect of abstention on the efficient administration of the bankruptcy estate" and "the burden of the bankruptcy court's docket." Absent transfer, therefore, the Bankruptcy Court would be speculating as to the impact that abstention would have on a chapter 11 bankruptcy estate being administered in the Southern District of California. Moreover, absent transfer, the Bankruptcy Court would have to speculate on the "burden" of the California Bankruptcy Court's docket. Judge Crawford adds that the Bankruptcy Court would have to decide whether the state court could timely adjudicate the litigation, a decision necessarily influenced by how the California Bankruptcy Court decides Commonwealth's pending motion for relief from stay and Vestavia Hills's pending complaint to extend the stay. In most scenarios, unlike this case, remand and abstention could probably be decided by the local bankruptcy court without issue; here, however, contingencies exist that are in the control and purview of the California Bankruptcy Court, and those contingencies weigh in favor of the home bankruptcy court, in California, deciding whether to remand or abstain. Regarding Vestavia Hills's transfer motion, Judge Crawford says "two preeminent considerations, namely the home court's presumptive suitability and that transfer will facilitate the economical and efficient administration of the estate" inform the Bankruptcy Court's decision. "Inasmuch as these two important considerations decidedly favor" Vestavia Hills's position, Judge Crawford concludes that transfer is warranted. A copy of the Court's Memorandum Opinion and Order dated Feb. 27, 2020 is available at https://bit.ly/2VUyRTE from Leagle.com. Commonwealth Assisted Living, LLC Series E, Plaintiff, represented by Richard J. Brockman -- rbrockman@burr.com -- Burr & Forman LLP, Brent D. Hitson -- bhitson@burr.com -- Burr & Forman LLP & Marc P. Solomon -- msolomon@burr.com -- Burr & Forman, LLP. Vestavia Hills LTD, dba, Judith A. Chance, Karen McElliott, Frank A. Virgadamo, Connie Virgadamo, B. Renee Barnard, Charles Barnard & Jack L. Rowe, Defendants, represented by Andrew P. Campbell -- andy@campbellpartnerslaw.com -- Campbell Partners Law LLC, John Harrison Hagood -- harris@campbellpartnerslaw.com -- Campbell Partners Law LLC, Christopher V. Hawkins -- Hawkins@sullivanhill.com -- Sullivan, Hill, Rez & Engel APLC & James P. Hill -- hill@sullivanhill.com -- Sullivan, Hll, Rez & Engel APLC. About Vestavia Hills Vestavia Hills, Ltd., which conducts business under the name Mount Royal Towers, operates a continuing care retirement community and assisted living facility for the elderly in Vestavia Hills, Ala. It offers individualized senior living options for a convenient community lifestyle and provides personalized nursing care. Vestavia Hills sought Chapter 11 protection (Bankr. S.D. Cal. Case No. 20-00018-11) on Jan. 3, 2020. The Debtor disclosed $18,531,957 in assets and $29,742,790 in liabilities as of the bankruptcy filing. Judge Louise Decarl Adler oversees the case. Sullivan Hill Rez & Engel is the Debtor's legal counsel. WILLIAMS PROPERTIES: Has Until April 30 to File Plan & Disclosures ------------------------------------------------------------------ Judge David E. Rice of the U.S. Bankruptcy Court for the District of Maryland, Baltimore Division, has ordered that debtor Williams Properties, Inc., must file a Disclosure Statement and a proposed Chapter 11 Plan on or before April 30, 2020. A full-text copy of the order dated March 17, 2020, is available at https://tinyurl.com/uhn9qj2 from PacerMonitor at no charge. The Chapter 11 case is In re Williams Properties, Inc. (Bankr. D. Md. Case No. 19-20358). WOLVERINE WORLD: Moody's Alters Outlook on Ba1 CFR to Negative -------------------------------------------------------------- Moody's Investors Service affirmed Wolverine World Wide, Inc.'s ratings, including its Ba1 corporate family rating, Ba1-PD probability of default rating, and Ba2 senior unsecured notes rating. The company's speculative grade liquidity rating was downgraded to SGL-2 from SGL-1. The rating outlook was changed to negative from stable. The outlook change to negative reflects the risk that a prolonged downturn triggered by the rapid spread of the coronavirus (COVID-19) will pressure Wolverine's revenue and profitability, as well as its ability to reduce leverage over the near-to-intermediate term. The company's lease-adjusted debt/EBITDA increased to around 3.6x at the end of 2019 from 2.7x in 2018 due to higher revolver borrowings to fund share repurchases, strategic capital investments and increased inventory. The downgrade to SGL-2 reflects Moody's forecasts for reduced free cash flow as well as the full drawdown of the remaining availability to boost cash balances. The affirmation reflects that while operating performance will be pressured, Wolverine is taking actions to reduce costs, preserve capital and generate positive operating cash flow in 2020. Affirmations: Issuer: Wolverine World Wide, Inc. Probability of Default Rating, Affirmed Ba1-PD Corporate Family Rating, Affirmed Ba1 Senior Unsecured Regular Bond/Debenture, Affirmed Ba2 (LGD5) Downgrades: Issuer: Wolverine World Wide, Inc. Speculative Grade Liquidity Rating, Downgraded to SGL-2 from SGL-1 Outlook Actions: Issuer: Wolverine World Wide, Inc. Outlook, Changed to Negative from Stable RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The apparel and footwear sector have been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Wolverine's credit profile, including its exposure to widespread store closures and discretionary consumer spending have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Wolverine remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact on Wolverine of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. Wolverine's Ba1 CFR reflects its meaningful scale in the global footwear industry, its sizable portfolio of brands which appeal to a broad range of consumer needs, and dependable replenishment demand cycles of the footwear category due to normal product wear and tear. The company returned to revenue growth and improved profit margins following its strategic realignment and the Wolverine Way Forward transformational plans. At the same time, Wolverine has significantly reduced acquisition debt since the end of 2012. Wolverine's credit profile is constrained by its narrow product focus in the footwear segment, and greater degree of fashion risk for certain brands. The rating reflects governance risks, including capital allocation policies that increased debt and leverage in 2019 related to share repurchases, strategic capital investments, and inventory increases in 2019; but EBITA/interest has remained solid at around 6.5x. Factors that would lead to an upgrade or downgrade of the ratings: Given the negative outlook as well as its small revenue scale and narrow product focus, an upgrade is not likely over the near term. However over time, Wolverine's ratings could be upgraded if it were to sustainably reduce financial leverage through further debt reduction and profitable growth. An upgrade would also require increased diversification via international expansion, or an expanded portfolio of brands or products. Quantitatively, ratings could be upgraded if adjusted debt/EBITDA was sustained below 3.0 times, EBITA/interest above 5.0x, and FFO/Net Debt above 35%. Ratings could be downgraded if the company were to see a sustained decline in operating performance, or if the company were to undertake more aggressive financial policies such as a sizable debt-financed acquisitions or share repurchases prior to meaningfully reducing leverage. A downgrade could also occur if liquidity were to weaken. Quantitatively, ratings could be downgraded if lease-adjusted debt/EBITDA was sustained above 3.5x or EBITA to interest coverage below 4.0x. Wolverine is a marketer of branded casual, active lifestyle, work, outdoor sport, athletic, children's and uniform footwear and apparel. The company's portfolio of brands includes: Merrell, Sperry, Hush Puppies, Saucony, Wolverine, Keds, Stride Rite, Chaco, Bates and HYTEST. The company also is the global footwear licensee of the Cat and Harley-Davidson brands. The company's products are carried by leading retailers in the U.S. and globally in approximately 170 countries and territories. The principal methodology used in these ratings was Apparel Methodology published in October 2019. YUM BRANDS: Moody's Alters Outlook on Ba2 CFR to Negative --------------------------------------------------------- Moody's Investors Service affirmed Yum! Brands Inc.'s Ba2 Corporate Family Rating, Ba2-PD Probability of Default Rating and B1 senior unsecured ratings. Moody's also affirmed KFC Holdings CO.'s Ba1 senior secured ratings and Ba3 senior unsecured ratings. Yum's Speculative Grade Liquidity rating was downgraded to SGL-2 from SGL-1. In addition, Moody's assigned a B1 rating to Yum's proposed $500 million senior unsecured notes. The outlook was changed to negative from stable. "The negative outlook reflects the risk that there may be a sustained weakening in Yum's credit metrics as they are increasing debt levels at a time when the company is facing significant uncertainty surrounding the potential length and severity of restaurant closures and the ultimate impact that these closures will have on Yum's revenues, earnings and liquidity." stated Bill Fahy, Moody's Senior Credit Officer. "The outlook also takes into account the negative impact on consumers ability and willingness to spend on eating out until the crisis materially subsides," Fahy added. The affirmation of the Ba2 CFR reflects the continuation of drive-through, delivery and curbside pick-up operations, good liquidity to manage through several months of significant revenue decline, and Moody's expectation that Yum will manage the business to preserve liquidity and then use cash flow to reduce debt once the crisis subsides. The downgrade of the Speculative Grade Liquidity to SGL-2 indicates good liquidity and reflects the negative impact on Yum's cash flow generation over the near term driven by the restrictions and closures placed on its restaurants. The SGL-2 is supported by its significant cash balances of approximately $1.0 billion and the absence of any material near-term maturities. Cash balances increased as a result of Yum fully drawing down its revolving credit facility and will be further bolstered by the proposed $500 million note offering. Proceeds from the proposed $500 million notes offering at Yum will be used general corporate purposes, which includes bolstering liquidity. Downgrades: Issuer: Yum! Brands Inc. Speculative Grade Liquidity Rating, Downgraded to SGL-2 from SGL-1 Assignments: Issuer: Yum! Brands Inc. Senior Unsecured Regular Bond/Debenture, Assigned B1 (LGD5) Affirmations: Issuer: KFC Holding Co. Senior Secured Bank Credit Facility, Affirmed Ba1 (LGD2) Senior Unsecured Regular Bond/Debenture, Affirmed Ba3 (LGD4) Issuer: Yum! Brands Inc. Probability of Default Rating, Affirmed Ba2-PD Corporate Family Rating, Affirmed Ba2 Senior Unsecured Regular Bond/Debenture, Affirmed B1 (to LGD5 from LGD6) Senior Unsecured Shelf, Affirmed (P)B1 Outlook Actions: Issuer: Yum! Brands Inc. Outlook, Changed to Negative from Stable RATINGS RATIONALE The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The restaurant sector has been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Yum's credit profile, including its exposure to widespread location restrictions and closures have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Yum remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The action reflects the impact of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. Yum's Ba2 CFR benefits from its significant scale, geographic reach, brand diversity and franchise-based business model which helps to add stability to revenues and earnings as compared to some other restaurant operators and reduces overall capital requirements. Approximately 98% of Yum's locations are franchised. The rating reflects Yum's governance risks associated with its relatively high leverage driven in part by its shareholder return target and reliance on securitization cash flows. The rating is also constrained by the intense competitive pressures and high level of promotional activity, particularly in the U.S. as well as less developed supply chains and event risk outside of the U.S. Yum's board of directors is a good mix of industry and industry related experience, as well as directors with large company experience and varied periods of board tenure. Yum's board has 11 members, 10 of which are independent. The board's involvement in business strategy, succession planning and responsible leadership are also important qualitative factors and served it well during the orderly transition and appointment of two different CEO's over the past 5-years. Restaurants are deeply entwined with sustainability, social and environmental concerns given their operating model with regards to sourcing food and packaging, as well as having an extensive labor force and constant consumer interaction. To this end, Yum's has a publicly stated goal to reduce average restaurant energy use and greenhouse gas emissions by an additional 10 percent by the end of 2025. While these may not directly impact the credit, these factors could impact brand image and result in a more positive view of the brand overall. Factors that would lead to an upgrade or downgrade of the ratings: Factors that could result in an upgrade include a sustained improvement in Pizza Hut US while maintaining good operating performance at KFC and Taco Bell along with a financial policy that results in debt to EBITDA of around 5.0 times and EBIT to Interest of about 3.0 times on a sustained basis. Factors that could result in a downgrade include a sustained deterioration in credit metrics despite a lifting of restrictions on restaurants and a subsequent recovery in earnings and liquidity with adjusted debt to EBITDA remaining at or above 5.7 times or EBIT to Interest below 2.5 times. Yum is headquartered in Louisville, Kentucky, and is the owner, operator and franchisor of quick service restaurants with brands that include KFC, Taco Bell, and Pizza Hut. Revenues are around $5.5 billion. [] S&P Alters Outlook on Transportation Infra Issuers to Negative ----------------------------------------------------------------- S&P Global Ratings revised to negative the outlooks on nearly all long-term debt ratings in the U.S. transportation infrastructure sector due to the severe and ongoing impacts associated with the COVID-19 pandemic. S&P believes the dramatic contraction of the global and U.S. economies and virtual collapse of travel and mobility across the transportation subsectors is a demand shock without precedent, with no definitive indication at this time regarding its duration and severity as well as the follow-on effects of an economic recession. The outlook revisions to negative of each issuer and issuer credit rating follows on our updated overall view of the sector. S&P is affirming the ratings and outlooks for transportation infrastructure issuers with existing negative outlooks and not modifying the ratings or outlooks of debt secured by federal transportation grants. The expected passage into U.S. law of an approximately $2 trillion federal stimulus package that includes direct financial aid to airport operators ($10 billion) and transit authorities ($25 billion) is viewed favorably and will alleviate immediate liquidity pressures, as well as assist with near-term operational funding requirements including debt service. Aid to the airline industry, in the form of loans and loan guarantees, should also support payments from airline tenants to airport operators. However, long-term credit implications across all sectors have yet to unfold, and S&P expects greater visibility on the broader impacts on issuers' financial and business profiles in the coming months. This action applies to the ratings of approximately 187 issuers and 252 ratings in the following six transportation subsectors: airports, toll roads and bridges, ports, transit systems, parking, and special facilities (e.g. consolidated rental car facilities at airports). S&P's entire transportation infrastructure portfolio of senior and subordinated credit ratings has a modal rating of 'A' with nearly all subject to volume risk--that is, they are dependent on passengers, riders, cargo, and vehicles to generate operating revenues necessary to meet operating requirements, debt service obligations, and capital needs. "The revision of credit rating outlooks to negative provides clarity to market participants that issuers face at least a one-in-three likelihood of a negative rating action over the intermediate term for investment-grade credits (generally up to two years) and over the short term for speculative-grade credits (generally up to one year)," said S&P Global Ratings credit analyst Kurt Forsgren. All ratings will be individually reviewed with respect to an issuer's specific exposure to, and ability to mitigate against, the financial and operational challenges in the near-to-intermediate term and our views of longer term risks. Negative outlooks on specific ratings may be returned to stable on a case-by-case basis in the near-to-medium term. It is important to recognize that the transportation infrastructure sectors benefit from –- and the current ratings on them reflect -– strong fundamental credit features including the often-dominant business positions that both support their ability to collect revenues from users, largely without significant regulatory limitations or approvals, and recover from demand shocks such as COVID-19. Similarly, management teams of the highly rated issuers in our portfolio are experienced, generally conservative in their budgeting and forecasting assumptions, and have historically taken measures that balanced meeting their public missions as well as debt service obligations. S&P views overall liquidity levels to be favorable with median unrestricted days' cash on hand that has averaged near 600 days for fiscal years 2018 and 2019. As of this date, credit conditions in the transportation industry continue to erode with plunging passenger and transaction volumes across the board in air travel, transit, toll facilities, and parking, as mobility is severely restricted or prohibited in many locations under stay-in-place orders. Collective efforts by federal, state and local officials to contain the virus outbreak and minimize the public health effects of COVID-19 by "flattening the curve" are both reducing the economic activity that the transportation sectors depend upon and prolonging the period volumes are depressed before recovering. Also, the lingering effects from trade conflicts and tariffs combined with the COVID-19 outbreak in China have dramatically disrupted shipping and maritime trade. Based on S&P's analysis and preliminary year-over-year data reported by issuers that it rates, volume in the past two weeks from passengers, riders, toll and parking transactions as well as shipping containers are lower compared with the same period in 2019; in a range of 60%-90% on the high end to 20%-40% on the low end depending on the transportation asset. Some tolled facilities and ports appear less affected on a relative basis, but the declines for all transportation infrastructure subsectors are significant and, for many, financially unsustainable at the current depressed levels. Critical to the near and long-term prospects of the transportation sectors is the economic outlook, which continues to worsen both globally and in the U.S. For the U.S., the year-on-year contraction in second-quarter GDP now looks to be at least double S&P Global Economics' earlier 6% estimate. Risks remain that U.S. travel restrictions could expand domestically, with continuing or lingering concerns about health and safety magnifying the negative effects across the travel value chain. Even when travel restrictions are lifted, S&P believes there may be an extended period before volume levels return, which pressures near-term credit quality. Also, systemic or permanent changes in consumer and industry behavior, shifts in supply chains, economic softening, and recessionary pressures could affect S&P's view of long-term ratings. S&P Global Ratings will continue to monitor and evaluate the cascading effects of this fluid and fast-moving situation. Potential negative rating actions could be either broad-based or credit specific. S&P's approach in conversations with management teams and evaluating available information will be: -- Focusing on near-term (next six months) liquidity or refinancing or remarketing risks faced by issuers, with primary attention on issuers with weaker credit profiles and lower liquidity, with the expectation that the significant declines S&P's seen will extend into the late summer to early fall. S&P expects to analyze issuers' available cash on hand, unrestricted and restricted assets, capital funding requirements and capital deferrals, and receivables, and any currently dedicated resources that may be available to meet near-term obligations, including use of federal stimulus money. -- Analyzing intermediate (six-12 months) funding and budgetary risks by issuers most affected by volume declines and evaluate management's actions to mitigate impacts and their contingency plans. S&P will monitor adjustments to operations, capital expenditures, financial forecasts, current and projected cash draws and liquidity levels as well as access to external liquidity while making principal and interest deposits. -- Gauging the shape of the economic and operational recovery at the macro level and what it could look like for the specific issuer. S&P will be reviewing long-term plans, evaluating growth rates and overall trajectory, operational changes, capital plan adjustments, and revised projections in the context of its view of anticipated volume levels. S&P Global Ratings will continue to monitor activity levels, industry developments, policy actions at the federal, state and local levels, and comment or take credit action as appropriate. A list of Affected Ratings can be viewed at: https://bit.ly/3dGqyRY [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re MNP Industries LLC Bankr. M.D. Fla. Case No. 20-02563 Chapter 11 Petition filed March 25, 2020 See https://is.gd/vaatXy represented by: David Steen, Esq. DAVID W. STEEN PA E-mail: dwsteen@dsteenpa.com In re Thomas J. Cieslik, Sr. Bankr. D.N.J. Case No. 20-14843 Chapter 11 Petition filed March 25, 2020 represented by: Ira Deiches, Esq. DEICHES & FERSCHMANN, A PROFESSIONAL CORPORATION In re Gentle Hearts 1, LLC Bankr. D. Colo. Case No. 20-12233 Chapter 11 Petition filed March 26, 2020 See https://is.gd/LUDIUf represented by: Aaron J. Conrardy, Esq. WADSWORTH GARBER WARNER CONRARDY, P.C. E-mail: aconrardy@wgwc-law.com In re Industrial Machinery Services 314, LLC Bankr. N.D. Ga. Case No. 20-20578 Chapter 11 Petition filed March 26, 2020 See https://is.gd/c1lAsn represented by: Charles Kelley, Esq. KELLEY & CLEMENTS LLP E-mail: ckelley@kelleyclements.com In re C Robertson Insurance Agency, LLC Bankr. N.D. Tex. Case No. 20-30982 Chapter 11 Petition filed March 26, 2020 See https://is.gd/wnsjOK represented by: Areya Aurzada, Esq. HOLDER LAW E-mail: areya@holderlawpc.com In re Gnirbes Inc. Bankr. S.D. Fla. Case No. 20-13992 Chapter 11 Petition filed March 26, 2020 See https://is.gd/ia5RgN represented by: Craig I. Kelley, Esq. KELLEY, FULTON & KAPLAN, P.L. E-mail: dana@kelleylawoffice.com In re Woods Sealing and Striping, Inc. Bankr. M.D. La. Case No. 20-80453 Chapter 11 Petition filed March 26, 2020 See https://is.gd/ZJo1BF represented by: Michael A. Fritz, Sr., Esq. FRITZ LAW FIRM E-mail: bankruptcy@fritzlawalabama.com In re Norwood Home LLC Bankr. D. Ariz. Case No. 20-03338 Chapter 11 Petition filed March 26, 2020 See https://is.gd/QO6qhX represented by: William D. Trusler, Esq. WILSON-GOODMAN LAW GROUP, PLLC In re Luke Ragsdale and Adriann Ragsdale Bankr. D.N.M. Case No. 20-10665 Chapter 11 Petition filed March 26, 2020 represented by: Thomas Walker, Esq. WALKER & ASSOCIATES, P.C. Email: twalker@walkerlawpc.com In re David A. Patton Bankr. M.D. Fla. Case No. 20-02660 Chapter 11 Petition filed March 27, 2020 represented by: Kathleen L. DiSanto, Esq. BUSH ROSS, P.A. E-mail: kdisanto@bushross.com In re Liberty Holding, LLC Bankr. E.D. Va. Case No. 20-10947 Chapter 11 Petition filed March 30, 2020 See https://is.gd/rvIMtq represented by: Robert B. Easterling, Esq. ROBERT B. EASTERLING, ATTORNEY AT LAW E-mail: eastlaw@easterlinglaw.com In re Leitrim Realty, Inc. Bankr. N.D.N.Y. Case No. 20-10555 Chapter 11 Petition filed March 30, 2020 See https://is.gd/NI3Nw1 represented by: Francis J. Brennan, Esq. NOLAN HELLER KAUFFMAN LLP E-mail: fbrennan@nhkllp.com In re South & Headley Associates, Ltd. Bankr. D.N.J. Case No. 20-15065 Chapter 11 Petition filed March 30, 2020 represented by: Jay Lubetkin, Esq. In re Allen Henderson Bankr. D. Nev. Case No. 20-11753 Chapter 11 Petition filed March 30, 2020 In re WEC Real Estate Solutions LLC Bankr. N.D. Ga. Case No. 20-65133 Chapter 11 Petition filed March 30, 2020 In re Dante Louis DeCecco Bankr. N.D. Okla. Case No. 20-10558 Chapter 11 Petition filed March 30, 2020 represented by: Michael Jones, Esq. In re James Bordonaro Bankr. E.D.N.Y. Case No. 20-71805 Chapter 11 Petition filed March 31, 2020 In re Moore Trucking Inc. Bankr. S.D. W.Va. Case No. 20-20136 Chapter 11 Petition filed March 31, 2020 See https://is.gd/roZx28 represented by: James M. Pierson, Esq. PIERSON LEGAL SERVICES E-mail: jpierson@piersonlegal.com In re Tonto Basin Concrete, Inc. Bankr. D. Ariz. Case No. 20-03540 Chapter 11 Petition filed April 1, 2020 See https://is.gd/r8SoAY represented by: Allan D. NewDelman, Esq. ALLAN D. NEWDELMAN, P.C. E-mail: anewdelman@adnlaw.net ********* 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. 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