/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/200522.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, May 22, 2020, Vol. 24, No. 142 Headlines 2808 OCEAN: Seeks to Hire Weiland Golden as Legal Counsel 5BARZ INTERNATIONAL: Seeks to Hire Mancuso Law as Legal Counsel 8341 BEECHCRAFT: Seeks Approval to Hire David Cahn as New Counsel ADVANCED ORTHOPEDICS: Voluntary Chapter 11 Case Summary AKORN INC: Case Summary & 30 Largest Unsecured Creditors AMERICAN CRYOSTEM: Incurs $147K Net Loss in Second Quarter APPLE VALLEY, MN: S&P Lowers 2016A Rev. Bond Rating to 'BB(sf)' AVANTOR INC: Fitch Hikes LongTerm IDR to BB-, Outlook Stable BENDON INC: Bank Debt Trades at 39% Discount BIMBO AND SONS: Seeks Court Approval to Hire Bankruptcy Attorney BSP TRUCKING: Seeks Court Approval to Hire Bankruptcy Attorney CARBO CERAMICS: To Seek Plan Confirmation on June 9 CHILDREN FIRST: Exclusive Plan Filing Period Extended Until Sept. 8 CL AND MEW: Seeks to Hire CPA Smith as Accountant COGENT COMMUNICATIONS: S&P Rates New EUR215MM Unsecured Notes 'B-' COOPER-STANDARD AUTOMOTIVE: S&P Rates $250MM Secured Notes 'B-' CP VI: Bank Debt Trades at 15% Discount CPG INTERNATIONAL: S&P Affirms 'B' ICR; Outlook Stable CRAFTWORKS PARENT: Offers Buyer $45M Less After COVID-19 Closures CRESTWOOD EQUITY: S&P Alters Outlook to Neg., Affirms 'BB-' ICR CUSHMAN & WAKEFIELD: S&P Rates New Senior Secured Notes 'BB-' D & S LAND: Unsecured Creditors Unimpaired Under Plan DIVERSIFIED HEALTHCARE: Moody's Cuts CFR to Ba2, Outlook Negative DJL BUILDERS: Unsecureds to Recover 3% Under Plan EDGEWELL PERSONAL: S&P Rates New $600MM Senior Unsecured Note 'BB' ENERGY ACQUISITION: Bank Debt Trades at 50% Discount EUROAMERICAN FOODS: Exclusivity Period Extended to July 11 EVIO INC: Incurs $20.7 Million Net Loss in Fiscal 2019 FLOYD'S INSURANCE: Case Summary & 20 Largest Unsecured Creditors FULTON PROPERTIES: Case Summary & 7 Unsecured Creditors GMS DINER: Case Summary & 20 Largest Unsecured Creditors GNC HOLDINGS: Stockholders Elect 11 Directors GRAPHIC TUFTING: Hires Gowin Machinery Sales as Appraiser GROW CAPITAL: Posts $613K Net Loss in Third Quarter GTC WORKS: Gets Court Approval to Hire Stick A Fork as Broker HENRY VALENCIA: Seeks to Hire Ricci & Company as Accountant INDUSTRIAL MACHINERY: Ask for June 30 Extension of Plan Deadline INNOVATIVE WATER: Bank Debt Trades at 90% Discount IRB HOLDING: S&P Affirms 'B' ICR on Signs of Restaurant Recovery J CREW: Bank Debt Trades at 51% Discount J.B. POINDEXTER: S&P Downgrades ICR to 'B+'; Outlook Negative JB AND COMPANY: Proposes May 25 Deadline for Disclosures Objections KAOPU GROUP: Expects to File its Quarterly Report by June 29 KEYSTONE PIZZA: Seeks Approval to Hire Spencer Fane as Counsel LEARFIELD COMMUNICATIONS: Moody's Cuts CFR to Caa1, Outlook Neg. LEGACY JH762: Comerica Bank Objects Disclosure Statement LIFEMILES LTD: Moody's Lowers CFR to Caa1, Outlook Negative LTMT INC: June 9 Combined Hearing on Plan & Disclosures LULU'S FASHION: Bank Debt Trades at 15% Discount M M & D HARVESTING: Gets Approval to Hire Country Boys Auction MAJESTIC HILLS: Case Summary & 20 Largest Unsecured Creditors MCBB CORP: Court Conditionally Approves Disclosure Statement MEN'S WEARHOUSE: Bank Debt Trades at 63% Discount MOOD MEDIA: S&P Withdraws 'CCC' Issuer Credit Rating MSCI INC: S&P Rates New $800MM Senior Unsecured Notes 'BB+' NEW CITIES: Says Plan Disclosure Requirements Satisfied NEWELL BRAND: Moody's Rates New $500MM Unsec. Notes 'Ba1' NEWELL BRANDS: Fitch Affirms 'BB' LongTerm IDR, Outlook Negative NIELSEN FINANCE: Moody's Rates $500MM Term Loan B Due 2025 'Ba1' NORTH AMERICAN LIFTING: $470MM Bank Debt Trades at 46% Discount NORTH AMERICAN LIFTING: Bank Debt Trades at 83% Discount NORTHWEST FIBER: S&P Rates Senior Unsecured Note Issuance 'CCC' NOVAN INC: Posts $6.17 Million Net Loss in First Quarter NPC INTERNATIONAL: $160MM Bank Debt Trades at 98% Discount NPC INTERNATIONAL: $605MM Bank Debt Trades at 57% Discount ONEWEB GLOBAL: Seamless Air Not Affected by OneWeb Filing ORIGIN AGRITECH: Reports RMB688,000 Net Loss for H1 FY 2020 OSI RESTAURANT: S&P Lowers Issuer Credit Rating to 'BB-' PARADIGM TELECOM: Unsecureds Owed $23M Get 1% Initial Payout PARK HOTELS: S&P Assigns 'B' Issuer Credit Rating; Outlook Neg. PREMIER ON 5TH: Disclosure Statement Conditionally Approved RENFRO CORP: S&P Cuts ICR to 'CCC-' on Heightened Refinancing Risk RIVORE METALS: Court Confirms Liquidating Plan ROYAL ALICE: AMAG Says Liquidation Analysis Insufficient ROYAL ALICE: Arrowhead Capital Questions Rental Income ROYAL ALICE: U.S. Trustee Wants Details of Plan Financing RR DONNELLEY: Moody's Rates New $300MM Unsec. Notes Due 2027 'B3' SCOOBEEZ INC: Unsecured Creditors to Recover $529K in Plan SCRANTON-LACKAWANNA HEALTH: S&P Cuts 2016A-C Bond Rating to 'CCC+' SMARTER TODDLER: Court Approves Disclosure Statement SNC-LAVALIN GROUP: S&P Affirms 'BB+' Issuer Credit Rating SOUTHERN GRAPHICS: Bank Debt Trades at 90% Discount STEPS IN HOME CARE: Files for Chapter 11 to Fend Off Lawsuits STIPHOUT FINANCE: Bank Debt Trades at 39% Discount SUNGARD AS: Bank Debt Trades at 62% Discount SUNPOWER CORP: Stockholders Re-Elect Three Directors TMX FINANCE: S&P Alters Outlook to Stable, Affirms 'B-' ICR TRANSPLACE HOLDINGS: Bank Debt Trades at 29% Discount TRIBE BUYER: Bank Debt Trades at 47% Discount ULTRA PETROLEUM: Davis Polk, Rapp Represent Noteholder Group UNIVERSAL HEALTH: Fitch Affirms 'BB+' LT IDR, Outlook Stable US STEEL: Fitch Affirms 'B-' LongTerm IDR, Outlook Negative WIDEOPENWEST FINANCE: S&P Affirms 'B' Issuer Credit Rating WILSONART LLC: S&P Alters Outlook to Negative, Affirms 'B+' ICR WWEX UNI: S&P Alters Outlook to Negative, Affirms 'B-' ICR XPLORNET COMMUNICATIONS: Moody's Assigns B3 CFR, Outlook Stable YAK ACCESS: Bank Debt Trades at 38% Discount YESHIVA UNIVERSITY: Moody' Affirms B3 Rating on $146MM Bonds YOUNG MEN'S: Case Summary & 7 Unsecured Creditors ZACHAIR LTD: Court Signs Bridge Order Extending Exclusivity Period [] BOOK REVIEW: The Sorcerer's Apprentice - Medical Miracles ********* 2808 OCEAN: Seeks to Hire Weiland Golden as Legal Counsel --------------------------------------------------------- 2808 Ocean Blvd., LLC seeks approval from the U.S. Bankruptcy Court for the Central District of California to employ Weiland Golden Goodrich, LLP as its legal counsel. Weiland Golden will provide these legal services: (a) advise Debtor with respect to the requirements and provisions of the Bankruptcy Code, Federal Rules of Bankruptcy Procedure, Local Bankruptcy Rules, U.S. Trustee Guidelines and other applicable requirements; (b) assist Debtor in preparing and filing amended schedules and statement of financial affairs, complying with and fulfilling U.S. Trustee requirements, and preparing other documents as may be required after the initiation of a Chapter 11 case; (c) assist Debtor in negotiations with creditors and other parties-in-interest; (d) assist Debtor in the preparation of a disclosure statement and formulation of a Chapter 11 plan of reorganization; (e) give legal advice concerning the rights and remedies of Debtor and its bankruptcy estate in regard to adversary proceedings which may be removed to, or initiated in, the bankruptcy court; (f) prepare legal papers; and (g) represent Debtor in any court proceeding or hearing where the rights of Debtor and its estate may be litigated or affected. The hourly rates for the firm's attorneys and professionals are as follows: Michael J. Weiland $750 Jeffrey I. Golden $750 David M. Goodrich $600 Reem J. Bello $600 Beth E. Gaschen $550 Michael R. Adele $550 Kerry A. Moynihan $530 Faye C. Rasch $530 Ryan W. Beall $450 Paralegals $250 Law Clerks $250 Prior to its bankruptcy filing, Debtor paid the firm an initial retainer of $10,000. Post-petition, the firm will receive a monthly replenishing retainer of $10,000 from Stephen Perkins, Debtor's managing member. Jeffrey Golden, Esq., and Beth Gaschen, Esq., attorneys at Weiland Golden, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jeffrey I. Golden, Esq. Beth E. Gaschen, Esq. Weiland Golden Goodrich LLP 650 Town Center Drive, Suite 600 Costa Mesa, CA 92626 Telephone No.: (714) 966-1000 Facsimile No.: (714) 966-1002 Email: jgolden@wgllp.com bgaschen@wgllp.com About 2808 Ocean Blvd. 2808 Ocean Blvd., LLC is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)) based in Newport Beach, Calif. On Mar. 24, 2020, 2808 Ocean Blvd. sought Chapter 11 protection (Bankr. C.D. Cal. Case No. 20-11023). The petition was signed by Steve Perkins, Debtor's managing member. At the time of the filing, Debtor disclosed estimated assets of $10 million to $50 million and estimated liabilities of $1 million to $10 million. Weiland Golden Goodrich, LLP is Debtor's legal counsel. 5BARZ INTERNATIONAL: Seeks to Hire Mancuso Law as Legal Counsel --------------------------------------------------------------- 5Barz International Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Florida to employ Mancuso Law, P.A. as its legal counsel nunc pro tunc to April 30. Mancuso Law will provide these professional services in connection with Debtor's Chapter 11 case: (a) advise Debtor with respect to its powers and duties and the continued management of its business operations; (b) advise Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements and with the rules of the court; (c) prepare legal papers necessary in the administration of the case; (d) protect the interests of Debtor in all matters pending before the court; and (e) represent Debtor in negotiation with its creditors in the preparation of a bankruptcy plan. The firm received an advance security retainer in the amount of $27,000. Nathan Mancuso, Esq., the firm's attorney who will be handling the case, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Nathan G. Mancuso, Esq. Mancuso Law, P.A. Boca Raton Corporate Centre 7777 Glades Road Suite 100 Boca Raton, FL 33434 Telephone: (561) 245-4705 Facsimile: (561) 226-2575 Email: ngm@mancuso-law.com About 5Barz International 5Barz International Inc. is a technology company that designs, manufactures, and sells a line of cellular network infrastructure devices referred to as "Network Extenders" for use in the home and office. 5Barz International filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 20-14866) on Apr. 30, 2020. At the time of the filing, Debtor had estimated assets of less than $50,000 and estimated liabilities of between $1 million and $10 million. The petition was signed by Daniel Bland, Debtor's chief executive officer. Judge Robert A. Mark oversees the case. Debtor is represented by Nathan G. Mancuso, Esq., at Mancuso Law, P.A. 8341 BEECHCRAFT: Seeks Approval to Hire David Cahn as New Counsel ----------------------------------------------------------------- 8341 Beechcraft LLC seeks approval from the U.S. Bankruptcy Court for the District of Maryland to employ the Law Office of David Cahn, LLC as its new legal counsel. David Cahn will substitute for the Law Offices of Richard B. Rosenblatt, PC, the firm initially hired by Debtor to handle its Chapter 11 case. David Cahn will be paid at hourly rates as follows: Attorney $300 Paralegal $100 The firm received an initial retainer fee of $7,500 from Debtor. David E. Cahn, Esq., at the Law Office of David Cahn, LLC, disclosed in court filing that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: David E. Cahn, Esq. Law Office of David Cahn, LLC 13842A Outlet Dr., #175 Silver Spring, MD 20904 Telephone: (301) 799-8072 About 8341 Beechcraft Based in Gaithersburg, Md., 8341 Beechcraft, L.L.C., listed itself as a single asset real estate as defined in 11 U.S.C. Section 101(51B). 8341 Beechcraft filed a Chapter 11 petition (Bankr. D. Md. Case No. 18-11393) on Feb. 1, 2018. At the time of the filing, Debtor estimated $1 million to $10 million in both assets and liabilities. Judge Thomas J. Catliota presides over the case. Debtor is represented by the Law Office of David Cahn, LLC. No official committee of unsecured creditors has been appointed in Debtor's case. ADVANCED ORTHOPEDICS: Voluntary Chapter 11 Case Summary ------------------------------------------------------- Debtor: Advanced Orthopedics & Pain Management, P.L. 3355 Burns Rd., Suite 304 Palm Beach Gardens, FL 33410 Business Description: Advanced Orthopedics & Pain Management, P.L. is a medical group practice located in Palm Beach Gardens, FL, specializing in orthopedic surgery, neurosurgery, and pain management. Chapter 11 Petition Date: May 21, 2020 Court: United States Bankruptcy Court Southern District of Florida Case No.: 20-15598 Judge: Hon. Mindy A. Mora Debtor's Counsel: Morgan B. Edelboim, Esq. EDELBOIM LIEBERMAN REVAH OSHINSKY PLLC 20200 W Dixie Highway, Suite 905 Miami, FL 33180 Tel: 305-768-9909 Email: morgan@elrolaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Scott Katzman, president. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/uWcGdD AKORN INC: Case Summary & 30 Largest Unsecured Creditors -------------------------------------------------------- Lead Debtor: Akorn, Inc. 1925 West Field Court Suite 300 Lake Forest, Illinois 60045 Business Description: Akorn, Inc., together with its Debtor and non-Debtor subsidiaries, is a specialty pharmaceutical company that develops, manufactures, and markets generic and branded prescription pharmaceuticals, branded as well as private-label over-the-counter consumer health products, and animal health pharmaceuticals. Akorn is headquartered in Lake Forest, Illinois, and maintains a global manufacturing presence, with pharmaceutical manufacturing facilities located in Illinois, New Jersey, New York, Switzerland, and India. Visit www.akorn.com for more information. Chapter 11 Petition Date: May 20, 2020 Court: United States Bankruptcy Court District of Delaware Seventeen affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Akorn, Inc. (Lead Debtor) 20-11177 10 Edison Street LLC 20-11178 13 Edison Street LLC 20-11180 Advanced Vision Research, Inc. 20-11182 Akorn (New Jersey), Inc. 20-11183 Akorn Animal Health, Inc. 20-11185 Akorn Ophthalmics, Inc. 20-11186 Akorn Sales, Inc. 20-11174 Clover Pharmaceuticals Corp. 20-11187 Covenant Pharma, Inc. 20-11188 Hi-Tech Pharmacal Co., Inc. 20-11189 Inspire Pharmaceuticals, Inc. 20-11190 Oak Pharmaceuticals, Inc. 20-11192 Olta Pharmaceuticals Corp. 20-11191 VersaPharm Incorporated 20-11194 VPI Holdings Corp. 20-11193 VPI Holdings Sub, LLC 20-11195 Judge: Hon. John T. Dorsey Debtors' General Bankruptcy Counsel: Patrick J. Nash, Jr., P.C. Gregory F. Pesce, Esq. Christopher M. Hayes, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Chicago, Illinois 60654 Tel: (312) 862-2000 Fax: (312) 862-2200 Email: patrick.nash@kirkland.com gregory.pesce@kirkland.com christopher.hayes@kirkland.com - and - Nicole L. Greenblatt, P.C. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Tel: (212) 446-4800 Fax: (212) 446-4900 Email: nicole.greenblatt@kirkland.com Debtors' Local Bankruptcy Counsel: Paul N. Heath, Esq. Amanda R. Steele, Esq. Zachary I. Shapiro, Esq. Brett M. Haywood, Esq. RICHARDS, LAYTON & FINGER, P.A. One Rodney Square 920 N. King Street Wilmington, Delaware 19801 Tel: (302) 651-7700 Fax: (302) 651-7701 Email: heath@rlf.com steele@rlf.com shapiro@rlf.com haywood@rlf.com Debtors' Restructuring Advisor: ALIXPARTNERS, LLP Debtors' Financial Advisor and Investment Banker: PJT PARTNERS LP Debtors' Tax Advisor: GRANT THORNTON LLP Debtors' Notice & Claims Agent: KURTZMAN CARSON CONSULTANTS LLC https://www.kccllc.net/akorn Total Assets as of March 31, 2020: $1,032,275,000 Total Debts as of March 31, 2020: $1,051,769,000 The petitions were signed by Joseph Bonaccorsi, authorized signatory. A copy of Akorn, Inc.'s petition is available for free at PacerMonitor.com at: https://is.gd/MDaoCq Consolidated List of Debtors' 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. McKesson Corporation Customer $14,497,590 6535 N. State Highway 161 Irving, TX 75039 Attn: John Pulido Johnson Tel: 972-830-3631 Email: john.johnson3@mckesson.com 2. Douglas Pharmaceuticals Trade Vendor $8,445,563 America Limited 1 Central Park Drive Lincoln, Auckland, 0610 NZ Attn: Kent Durbin Tel: 64-9-914-0669 Fax: 64-9-835-0665 Email: kentd@douglas.co.nz 3. Amerisourcebergen Global Customer $4,889,970 Services 1300 Morris Drive Chesterbrook, PA 19087 Attn: Heather Odenwelder Tel: 610-727-2472 Fax: 800-640-5221 Email: hodenwelder@amerisourcebergen.com 4. Cardinal Health Customer $3,311,195 7000 Cardinal Place Dublin, OH 43017 Attn: Kelli Jones Tel: (614) 757-9578 Email: kelli.jones@cardinalhealth.com 5. OptumRx Inc. Customer $2,573,674 2858 Loker Ave Ste 100 Carlsbad, CA 92010 Attn: Kent Rogers Tel: 949-988-6066 Email: kent.rogers@optum.com 6. CVS Health Corporation Customer $2,110,798 Attn MC 1110 One CVS Drive Woonsocket, RI 02895 Attn: Scott Griffin Tel: (401) 770-4353 Email: scott.griffin@cvshealth.com 7. Laboratoire Unither Trade Vendor $1,780,422 Groupe Unither Espace Industriel Nord 151 Rue Andre Durouchez Amiens, 80 80080 France Attn: Eric Goupil Tel: +33144635170 Fax: 011-33-144635179 Email: eric.goupil@unither-pharma.com 8. Catalent Pharma Solutions Trade Vendor $1,707,214 14 Schoolhouse Road Somerset, NJ 08873 Attn: Bill Hartzel Tel: (717) 542-4922 Email: bill. hartzel@catalent.com 9. Amri Rensselaer Inc. Trade Vendor $1,473,887 Organichem Corp 21 Corporate Circle Albany, NY 12203 Attn: Steve Lichter Tel: 872-241-5203 Email: steve.lichter@amriglobal.com 10. Health Trust Purchasing Customer $1,397,519 Group 1100 Dr Martin L King Jr Bldv Ste 1100 Nashville, TN 37203 Attn: Chris Little Tel: 314-364-6595; 615-344-3000 Email: thomas.little@healthtrustpg.com hpgsvc@healthtrustpg.com 11. Santen Pharmacetucal Co Ltd. Royalty $1,321,096 4-20, Ofu Kacho KTA-Ku Grand Front Osaka Tower A Osaka, JP 530-8552 Japan Attn: Ken Araki Tel: 81-6-4802-9652 Fax: 81-6-6321-5082 Email: ken.araki@santen.com 12. Vizient Inc. Customer $974,014 290 East John Carpenter Freeway Irving, TX 75062 Attn: Gloria Sumler Tel: (972) 581-5244; 972-581-5089; 972-581-5000 Email: gloria.sumler@vizientinc.com 13. Walmart Customer $754,349 702 Southwest 8th St Bentonville, AR 72716 Attn: Dick Derks Tel: (479) 204-9441 Email: dderks@walmart.com 14. NSF Health Sciences LLC Consultant $714,288 2001 Pennsylvania Avenue Ste 950 Washington, DC 20006 Attn: Maxine Fritz Tel: 202-822-1850 Fax: 734-769-0109 Email: mfritz@nsf.org; nsfbilling@nsf.org 15. Clarusone Sourcing Services LLP Customer $703,895 6 St Andrew Street London, EC4A 3AE United Kingdom Attn: Sarah O. Larson Tel: +011(44) 7712 681 824 Email: sarah.larson@clarusonessourcing.com 16. Leadiant Biosciences Inc. Trade Vendor $559,987 800 South Frederick Avenue Suite 300 Gaithersburg, MD 20877 Attn: Michael Minarich Tel: 815-603-9037 Fax: 301-948-1862 Email: michael.minarich@leadiant.com 17. Thermo Fisher Scientific Trade Vendor $517,421 168 Third Avenue Waltham, MA USA 02451 Attn: Isabelle Lafosse Tel: (513) 375-2174 Email: isabelle.lafosse@thermofisher.com 18. Walgreens Customer $510,449 108 Wilmont Rd Deerfield, IL 60015 Attn: Zachary Mikulak Tel: 847-964-4058 Email: zachary.mikulak@walgreens.com 19. Department of Veterans Customer $453,855 Affairs P.O. Box 76, 1st Avenue One Block North of 22nd Street Hines, IL 60141 Attn: Erik Boehmke Tel: 708-786-5803 Fax: 708-786-5828 Email: erick.boehmke@va.gov 20. Target Corporation Customer $440,755 1000 Nicollet Mall Minneapolis, MN 55403 Attn: Becky Fait Tel: (612) 696-6340 Email: becky.fait@target.com 21. Amazon.com Services Inc. Customer $420,307 410 Terry Ave N Seattle, WA 98109 Attn: Kyle Templeton; Gabrielle Lewnes Tel: (206) 266-1000 Email: kyltemp@amazon.com; abboudg@amazon.com 22. Express Scripts Inc. Customer $409,978 One Express Way St Louis, MO 63121 Attn: Jason Parrish; Lynn Fernandez Tel: (314) 684-6211 Email: jmparrish@express-scripts.com; lynn.fernandez@econdisc.net 23. Morris & Dickinson Co Ltd Customer $396,894 10301 Highway 1 South Shreveport, LA 71115 Attn: Paul Dickson Tel: 318-797-7900 Fax: 318-798-5237 Email: pmdjr@morrisdickson.com; info@morrisdickson.com 24. Humana Pharmacy Solutions Customer $354,593 500 West Main Street 7th Floor Louisville, KY 40202 Attn: Mike Vezza Tel: (502) 301-3434 Email: mvezza@humana.com 25. Optisource LLC Customer $333,327 7500 Flying Cloud Dr Eden Prairie, MN 55344 Attn: Matt Adams Tel: 952-334-8366; 952-937-0901 505-792-0277 Email: optisouirce.matt@gmail.com 26. Eagle Pharmacy LLC Trade Vendor $327,646 350 Eagles Landing Drive Lakeland, FL 33810 Attn: Stacy Huss Tel: 303-725-1700 Email: shuss@eaglesfp.com 27. Berlin Packaging LLC Trade Vendor $325,832 525 West Monroe, 14th Floor Chicago, IL 60661 Attn: Andrew Berlin Tel: 312-876-9292;800-723-7546; 312-965-9000 Fax: 312-876-9290 Email: andrew.berlin@berlinpackaging.com 28. GDL International Trade Vendor $306,000 3715 Beck Rd St. Joseph, MO 64506 Attn: Marcy Enneking Tel: 816-364-3520; 913-49-6570 Email: marcy@gdlinternational.com 29. PD Sub LLC Trade Vendor $252,644 2629 S Shanley Rd Saint Louis, MO 63144 Attn: Brian Scanlan Tel: 314-281-8017 Email: bscanlan@particledynamics.com 30. Fresenius Kabi USA, LLC Litigation - Three Corporate Drive Lake Zurich, IL 60047 Attn: Jack C. Silhavy Tel: 847-550-2760 Fax: 847-550-2920 Email: jack.silhavy@fresenius-kabi.com AMERICAN CRYOSTEM: Incurs $147K Net Loss in Second Quarter ---------------------------------------------------------- American CryoStem Corporation reported a net loss of $147,227 on $161,340 of total revenues for the three months ended March 31, 2020, compared to a net loss of $352,103 on $44,320 of total revenues for the three months ended March 31, 2019. The loss for the second quarter of Fiscal 2020 includes a reduction of $132,019 of derivative liability associated with an outstanding convertible note. For the six months ended March 31, 2020, the Company reported a net loss of $419,087 on $294,467 of total revenues compared to a net loss of $646,533 on $159,711 of total revenues for the six months ended March 31, 2019. As of March 31, 2020, the Company had $1.24 million in total assets, $2.72 million in total liabilities, and a total shareholders' deficit of $1.48 million. Operating expenses increased to $501,943 for the quarter ended March 31, 2020, from $346,963 for the same period in Fiscal 2019 an increase of 44.7%. The main cause for the increase was the allowance for doubtful accounts creating a large bad debt expense. Interest expense for the quarter ending March 31, 2020 increased to $42,034 as compared to $28,751 for the same period last year. The interest expense for the quarter ended March 31, 2020 and March 31, 2019 includes an additional $20,691 and $12,500 respectively for the effects of the beneficial conversion feature associated with debenture holders. As of March 31, 2020, the Company had a cash balance of $11,217, a decrease of $12,583 since Sept. 30, 2019. The Company used $324,277 of its cash for operations and $7,930 for investing activities. The main sources of cash provided by financing activities included new equity and note issuances of $343,000. Accounts Receivable decreased to $253,295 at March 31, 2020 from $330,154 at Sept. 30, 2019 mainly due to an increase in receivables from Baoxin for licensing fees along with a $325,000 increase in the allowance for doubtful accounts. Due to the current economic and health conditions in China, including increased tariffs and the Corona virus, the Company is closely monitoring the impact of these circumstances. Convertible debt increased to $626,170 an increase of $125,382 since Sept. 30, 2019. This increase was due to the issuance of a new convertible note of $168,000 less the effects of amortizing the beneficial conversion feature of these notes. American CryStem said, "The Company will continue to focus on its financing and investment activities, but should we be unable to raise sufficient funds, we will be required to curtail our operating plans or cease them entirely. We cannot assure you that we will generate the necessary funding to operate or develop our business. In the event that we are able to obtain the necessary financing to move forward with our business plan, we expect that our expenses will increase significantly as we attempt to grow our business. Accordingly, the above estimates for the financing required may not be accurate and must be considered in light these circumstances. "There was no significant impact on the Company's operations as a result of inflation for the three months ended March 31, 2020. "We will require additional capital to fund marketing, operational expansion, processing staff training, as well as for working capital. We are attempting to raise sufficient funds that would enable us to satisfy our cash requirements for a period of the next 12 to 24 months. In order to finance further market development with the associated expansion of operational capabilities for the time period, we will need to raise additional working capital. However, we cannot assure you we can attract sufficient capital to enable us to fully fund our anticipated cash requirements during this period. In addition, we cannot assure you that the requisite financing, whether over the short or long term, will be raised within the necessary time frame or on terms acceptable to us, if at all. Should we be unable to raise sufficient funds we may be required to curtail our operating plans if not cease them entirely. As a result, we cannot assure you that we will be able to operate profitably on a consistent basis, or at all, in the future." A full-text copy of the Quarterly Report is available for free at the Securities and Exchange Commission's website at: https://is.gd/AMpXA0 About American CryoStem Eatontown, New Jersey-based American CryoStem Corporation (OTC: CRYO) -- http://www.americancryostem.com/-- is a developer, marketer and global licensor of patented adipose tissue-based cellular technologies and related proprietary services with a focus on processing, commercial bio-banking and application development for adipose (fat) tissue and autologous adipose-derived regenerative cells (ADRCs). American CryoStem reported a net loss of $1.08 million for the year ended Sept. 30, 2019, compared to a net loss of $1.49 million for the year ended Sept. 30, 2018. Fruci & Associates II, PLLC, in Spokane, Washington, the Company's auditor since 2017, issued a "going concern" qualification in its report dated Jan. 14, 2020, citing that the Company has incurred significant losses since inception. This factor raises substantial doubt about the Company's ability to continue as a going concern. APPLE VALLEY, MN: S&P Lowers 2016A Rev. Bond Rating to 'BB(sf)' --------------------------------------------------------------- S&P Global Ratings lowered its long-term rating to 'BB(sf)' from 'BBB(sf)' on the city of Apple Valley, Minn.'s senior tier 2016A senior living revenue bonds (Minnesota Senior Living LLC Project, or the project). At the same time, S&P affirmed the 'B(sf)' and 'B-(sf)' long-term ratings on the project's second tier 2016B and third tier 2016C senior living revenue bonds, respectively. The outlook is negative. The series 2016 bonds were issued in late 2016 by the city of Apple Valley on behalf of the borrower, Minnesota Senior Living LLC. The 2016 issuance consists of four tranches of debt, with the fourth tranche being unrated. Proceeds of the bonds, with a total par amount of $147.97 million, were used by the borrower to acquire eight senior living facilities located in the Minneapolis-St. Paul metro area that consist of 1,007 rental independent living, assisted living, and memory care beds. Proceeds of the bonds were also used to fund debt service reserve funds for the subordinate series and to pay certain capital and issuance costs. As of fiscal year-end Sept. 30, 2019 there is $146.14 million in debt outstanding. "The downgrade on the senior 2016A bonds and the affirmation of the ratings on the 2016B and 2016C bonds reflects implementation of our Methodology for Rating U.S. Public Finance Rental Housing Bonds published on April 15, 2020," said S&P Global Ratings credit analyst Joanie Monaghan. The ratings are no longer under criteria observation. S&P's rating action incorporates its view regarding the health and safety risks posed by the COVID-19 pandemic, which have affected all affordable age-restricted housing developments. Specifically, the risk of increasing expenses and decreases in rental revenue related to the social risks of the pandemic have been evaluated in S&P's rating. S&P views the project's governance risks to be lower than average compared to the sector as the ownership entity has greater sophistication, depth of bench, and more substantial policies, procedures and governance practices than the ownership entities of peers. Environmental risks are in line with that of the sector as there are not any elevated environmental threats present in the areas in which the project properties are located (Apple Valley area). AVANTOR INC: Fitch Hikes LongTerm IDR to BB-, Outlook Stable ------------------------------------------------------------ Fitch Ratings has upgraded Avantor, Inc.'s Long-Term Issuer Default Rating to 'BB-'/Stable Outlook from 'B+'/Positive Outlook. The upgrade is supported by strong operating performance and realization of deal synergies related to the VWR Inc. acquisition, a strong FCF and liquidity profile, and continued deleveraging to around 5.0x gross debt/EBITDA. While operations will be impacted from the coronavirus pandemic near term, Fitch expects the company will be able to operate with gross debt/EBITDA below 5.0x in more normalized operating periods. The ratings apply to roughly $5.1 billion of debt outstanding at March 31, 2020. KEY RATING DRIVERS Manageable Coronavirus Effects: Fitch expects some near-term demand softness for Avantor's products as a result of coronavirus related business disruption influencing the company's customers. However, the business profile is relatively resilient because of good end market diversification and non-cyclical demand for healthcare products. Avantor's biopharma end markets have held up fairly well and have benefited from COVID-19 related testing demand. The industrials end markets have seen more significant business disruption effects from the pandemic, but because of the diversity of the customers served in the advanced technologies and applied materials businesses, demand for the company's products has remained relatively stable. Fitch anticipates some EBITDA margin pressure in the near term due to weaker demand but expects this to be partially offset by the company's ability to reduce operating expenses and continued synergy realization from the VWR acquisition. Fitch's forecast incorporates roughly $220 million of annual cost synergies by year-end 2020. Ample Liquidity during Pandemic: Fitch expects Avantor to maintain a comfortable liquidity cushion throughout the pandemic related business disruption. Between cash on hand, ongoing cash generation and committed lines of revolving credit, Fitch expects the company to have adequate liquidity to support operations, capital spending needs, preferred dividends and required term loan amortization during 2020. Avantor's good level of FCF generation is supportive of the 'BB-' IDR and could exceed $300 million annually in 2020-2023, even though 2020 will face coronavirus-related operational headwinds, representing a FCF margin of 5%-6%. If the company is able to refinance high interest debt, a decline in cash interest expense will provide upside for Fitch's FCF forecast. Leverage Continues to Decline: Avantor's gross debt/EBITDA was 4.7x at March 31, 2020, and Fitch forecasts leverage of 5.0x at the end of 2020, assuming some coronavirus-related pressure on EBITDA and limited debt reduction as the company prioritizes maintaining liquidity in the near term. The company has successfully reduced debt since the merger with VWR, from a Fitch-calculated nearly 10x following the close of the transaction. This is the result of the combined effects of EBITDA growth and debt reduction, which was partly funded through the proceeds of an initial public offering. Good Progress Realizing Cost Synergies: EBITDA growth has been helped by the realization of cost synergies since the VWR merger. Continued progress will help to offset coronavirus-related pressure on operating margins during 2020. Since the closing of the transaction the company has realized $300 million of synergies on a run-rate basis as of March 31, 2020, and Fitch's forecast incorporates roughly $220 million of annual cost synergies by year-end 2020. Fitch believes revenue synergies should also continue to be achievable going forward but does not incorporate this in its forecast. Strong Competitive Position and Good Diversification: Avantor is well diversified through end markets and product categories, with biopharma representing about 50% of total sales. Advanced technologies and applied materials end markets represent roughly 25% of sales and includes a mix of more cyclical end markets that benefit from highly recurring consumable sales. Consistent cash generation is supported through highly diversified consumables- and service-focused revenues representing roughly 85% of sales, and more limited exposure to equipment and instrumentation (15% of sales) versus peers. Strength and diversification in high-growth end markets should offset slower growth and cyclical end markets, resulting in single-digit revenue growth above the average life sciences industry. DERIVATION SUMMARY Avantor's strongest competitors are significantly larger, with leading positions in the broader life sciences industry and greater financial flexibility. Thermo Fisher (BBB/Stable) is Avantor's closest peer within the lab products industry. Thermo Fisher, a direct distribution competitor, is materially larger than Avantor, has an industry-leading manufacturing business, and is much more conservatively capitalized. Other 'BB-' rated healthcare companies operating in different industry sub-sectors typically have leverage sensitivities in the 4.0x - 5.0x range. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- COVID-19 affects Q2'20 revenue the most, but strengths in biopharma and the expected return to work for Avantor's customers in H2'20 will aid recovery in the second half of the year. As a result, Fitch forecasts flat revenue growth for 2020. EBITDA margins see some compression of roughly 30 bps, but variable cost structure and continued cost synergies from VWR acquisition somewhat offset dampened revenue pull-through. -- 2021-2023 organic revenue growth in the low- to mid-single-digits. -- 2021-2023 EBITDA margins of 17.75% to 18%. Fitch's EBITDA forecast includes $220 million of cost synergies by the third year after the Avantor acquisition. -- CAPEX is forecasted to be around 1.5% of revenues. -- Free cash flow exceeding $300 million in 2020-2023. -- Gross debt/EBITDA is maintained around 5.0x in 2020 and maintained between 4.5x-5.0x through 2022. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Operating with gross debt/EBITDA sustained below 4.5x; -- Continued operational strength that results in (cash flow from operations - capex)/total debt around or above 7.5%. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Operating with gross debt/EBITDA sustained above 5.0x; -- Pressures to profitability or increased expenses that result in (cash flow from operations - capex)/total debt sustained below 6%. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: Liquidity was supported by cash on hand of $346 million and availability of $248 million under a $250 million first lien secured revolver due 2022 as of March 31, 2020. Avantor's senior secured credit facility does not include financial maintenance covenants aside from a springing first lien net leverage covenant of 7.35x if 35% of the revolver is drawn. Additionally, working capital needs are supported by a $300 million accounts receivable securitization facility, of which $287 million was unused at March 31, 2020. Debt Maturities Manageable: The company's debt maturities and amortizations are manageable with term loan amortization of roughly $20 million per year for the next two years. The first lien secured notes mature in 2024 and the unsecured notes mature in 2025. The receivables facility matures in March 2023. Senior Unsecured Notes Notched Up: Fitch rates the senior unsecured notes 'BB/RR2', one notch above the IDR of 'BB-'. While the debt structure is weighted toward secured debt at roughly 60% of total, Fitch estimates superior recovery for both the secured and unsecured debt. ESG CONSIDERATIONS The highest level of ESG credit relevance, if present, is a score of 3. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity(ies), either due to their nature or to the way in which they are being managed by the entity(ies). BENDON INC: Bank Debt Trades at 39% Discount -------------------------------------------- Participations in a syndicated loan under which Bendon Inc is a borrower were trading in the secondary market around 61 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 72 cents-on-the-dollar for the week ended May 8,2020. The $118.5 million facility is a Term loan. The facility is scheduled to mature on April 1, 2021. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. BIMBO AND SONS: Seeks Court Approval to Hire Bankruptcy Attorney ---------------------------------------------------------------- Bimbo and Sons Corporation seeks approval from the U.S. Bankruptcy Court for the Eastern District of California to employ Chinonye Ugorji, Esq., to handle its Chapter 11 case. Ms. Ugorji has agreed to represent Debtor on a flat fee basis. Under the terms of her employment agreement, Ms. Ugorji will receive a flat fee of $6,000 for the pre-bankruptcy services that she provided to Debtor and a flat fee of $15,000 for post-petition work. Her hourly rate at the time she signed the agreement was $300. Ms. Ugorji is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The attorney holds office at: Chinonye U. Ugorji, Esq. Nonye Ugorji Law Corporation 2775 Cottage Way, Suite 36 Sacramento, CA 95825-1230 Telephone: (916) 925-1894 Facsimile: (916) 925-8893 Email: nonyelawcorp@gmail.com About Bimbo and Sons Corporation Bimbo and Sons Corporation, a freight shipping trucking company based in Tracy, Calif., filed a Chapter 11 petition (Bankr. E.D. Cal. Case No. 20-22209) on April 24, 2020, listing under $1 million in both assets and liabilities. The case is assigned to Judge Fredrick E. Clement. Debtor tapped Chinonye U. Ugorji, Esq., as its legal counsel. BSP TRUCKING: Seeks Court Approval to Hire Bankruptcy Attorney -------------------------------------------------------------- BSP Trucking, Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of California to employ Chinonye Ugorji, Esq., to handle its Chapter 11 case. Ms. Ugorji has agreed to represent Debtor on a flat fee basis. Under the terms of her employment agreement, Ms. Ugorji will receive a flat fee of $12,000 for the pre-bankruptcy services that she provided to Debtor and a flat fee of $20,000 for post-petition work. Her hourly rate at the time she signed the agreement was $300. Ms. Ugorji is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The attorney holds office at: Chinonye U. Ugorji, Esq. Nonye Ugorji Law Corporation 2775 Cottage Way, Suite 36 Sacramento, CA 95825-1230 Telephone: (916) 925-1894 Facsimile: (916) 925-8893 Email: nonyelawcorp@gmail.com About BSP Trucking BSP Trucking Inc., a trucking company based in Lathrop, Calif. filed a Chapter 11 petition (Bankr. E.D. Cal. Case No. 20-22211) on April 24, 2020. The petition was signed by BSP Trucking President Balwinder Prasher. At the time of the filing, Debtor disclosed total assets of $1,575,700 and total liabilities of $1,453,671. The case is assigned to Judge Fredrick E. Clement. Debtor tapped Chinonye U. Ugorji, Esq., as its legal counsel. CARBO CERAMICS: To Seek Plan Confirmation on June 9 --------------------------------------------------- Carbo Ceramics Inc., et al., submitted a First Amended Disclosure Statement for the Debtors’ Joint Chapter 11 Plan of Reorganization. On April 23, 2020, the Court entered the Order (I) Conditionally Approving the Disclosure Statement, (II) Scheduling a Combined Plan and Disclosure Statement Hearing, (III) Approving Solicitation Packages and Procedures, (IV) Approving the Form of Ballots and Notices, and (V) Granting Related Relief (the "Conditional Disclosure Statement Order"). Pursuant to the Conditional Disclosure Statement Order, the Court, among other things, (i) conditionally approved the Disclosure Statement as having adequate information under Section 1125 of the Bankruptcy Code without prejudice to any party in interest objecting to the Disclosure Statement by the Objection Deadline for consideration at the Combined Hearing and (ii) scheduled a combined hearing (the "Combined Hearing") to consider the adequacy of the Disclosure Statement on a final basis, any objections thereto, confirmation of the Plan, any objections thereto, and any other matter that may properly come before the Court for June 9, 2020, at 1:30 p.m. (Prevailing Central Time). The Bar Date Order sets (i) May 29, 2020 at 5:00 p.m. (Prevailing Central Time) as the general bar date and deadline by which creditors of Asset Guard and StrataGen must file proofs of claim and (ii) June 30, 2020 at 5:00 p.m. (Prevailing Central Time) as the general bar date and deadline by which creditors of CARBO must file proofs of claim. The Bar Date Order sets September 25, 2020 at 5:00 p.m. (Prevailing Central Time) as the bar date and deadline by which governmental entities holding claims against the Debtors must file proofs of claim. Pursuant to sections 1128 and 1129 of the Bankruptcy Code, the Court has scheduled the Combined Hearing to consider, among other things, confirmation of the Plan. The Combined Hearing has been scheduled to be heard on [June 9], 2020 at 1:30 p.m. (Prevailing Central Time) in Courtroom #404 of the United States Bankruptcy Court for the Southern District of Texas, Houston Division, located at 515 Rusk Street, 4th floor, Houston, Texas 77002. Section 1128(b) of the Bankruptcy Code provides that any party in interest may object to the confirmation of a plan. The Court has set the deadline to object to the final approval of the Disclosure Statement and the confirmation of the Plan as June 3, 2020 at 5:00 p.m. (Prevailing Central Time) A black-line copy of the First Amended Disclosure Statement for the Debtors' Joint Chapter 11 Plan of Reorganization dated April 29, 2020, is available at https://tinyurl.com/ycr7la8b from PacerMonitor.com at no charge. The Debtors' counsel: Paul E. Heath Matthew W. Moran Garrick C. Smith Matthew D. Struble VINSON & ELKINS LLP Trammell Crow Center 2001 Ross Avenue, Suite 3900 Dallas, TX 75201 - and - David S. Meyer Michael A. Garza VINSON & ELKINS LLP The Grace Building 1114 Avenue of the Americas New York, New York 10036-7708 About CARBO Ceramics CARBO Ceramics Inc. -- https://carboceramics.com/ -- is a global technology company providing products and services to the oil and gas, industrial, and environmental markets. CARBO offers oilfield ceramic technology products, base ceramic proppant, and frac sand proppant for use in the hydraulic fracturing of oil and natural gas wells. Asset Guard Products Inc., a subsidiary of CARBO, offers products intended to protect operators' assets, minimize environmental risks, and lower lease operating expenses through spill prevention, containment, and countermeasure systems for the oil and gas industry. StrataGen, Inc., another subsidiary, offers fracture consulting and data services and provides a suite of stimulation software solutions used for designing fracture treatments and for on-site real-time analysis to assist E&P companies in the efficient completion of wells and enhancement of oil and natural gas production. CARBO Ceramics and its subsidiaries sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 20-31973) on March 29, 2020. At the time of the filing, Debtors disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge Marvin Isgur oversees the cases. The Debtors tapped Vinson & Elkins LLP as bankruptcy counsel; Okin Adams LLP as special counsel; Perella Weinberg Partners L.P. and Tudor Pickering, Holt & Co. as investment banker; FTI Consulting, Inc. as financial advisor; Ernst & Young LLP, KPMG LLP, and Weaver and Tidwell L.L.P. as accountants and tax advisors. Prime Clerk, the claims agent, maintains this website https://dm.epiq11.com/case/crc/info CHILDREN FIRST: Exclusive Plan Filing Period Extended Until Sept. 8 ------------------------------------------------------------------- Judge Robert Mark of the U.S. Bankruptcy Court for the Southern District of Florida extended to Sept. 8 the period during which only Children First Consultants, Inc. can file a Chapter 11 plan and disclosure statement. Children First sought the extension in order to allow its special counsel to (i) engage in litigation with the Agency for Health Care Administration and Wellcare Health Plans, Inc. and recover outstanding receivables in excess of $1.5 million and $18,000, respectively; (ii) create financial projections based upon the success of the litigation claims; and (ii) formulate a plan of reorganization. About Children First Consultants Children First Consultants Inc., a mental health services provider in Miami, Fla., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-25286) on Nov. 13, 2019. At the time of the filing, Debtor was estimated to have assets of between $1 million and $10 million and liabilities of the same range. The case is assigned to Judge Robert A. Mark. Debtor tapped Agentis PLLC as its bankruptcy counsel, and Christopher M. David and Fuerst Ittleman David & Joseph as its special litigation counsel. CL AND MEW: Seeks to Hire CPA Smith as Accountant ------------------------------------------------- CL and Mew Company, LLC seeks approval from the U.S. Bankruptcy Court for the District of Columbia to employ CPA Smith, LLC as its accountant. CPA Smith will assist Debtor in the preparation of monthly operating reports, tax returns and financial documents, and will provide other accounting services in connection with Debtor's Chapter 11 case. The firm charges an hourly fee of $250 for its services. CPA Smith does not represent interests adverse to those of Debtors' bankruptcy estate, according to court filings. The firm can be reached through: Larry Smith CPA SMITH LLC 14711 Main Street Upper Marlboro, MD 20772 Telephone: (301) 627-8997 About CL and Mew Company CL and Mew Company, LLC, an engineering services company based in Washington, D.C., filed a Chapter 11 petition (Bankr. D.D.C. Case No. 20-00091) on Feb. 17, 2020, listing under $1 million in both assets and liabilities. Debtor tapped Craig A. Butler, Esq., at The Butler Law Group, PLLC, as its legal counsel. COGENT COMMUNICATIONS: S&P Rates New EUR215MM Unsecured Notes 'B-' ------------------------------------------------------------------ S&P Global Ratings assigned its 'B-' issue-level rating and '6' recovery rating to Washington, D.C.-based high-speed internet service provider Cogent Communications Group Inc.'s proposed EUR215 million senior unsecured notes due 2024. The '6' recovery rating indicates S&P's expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a payment default. Initially, the unsecured notes will be issued by Cogent Communications Finance Inc. Following an exchange on their release from escrow, the issuer will become Cogent Communications Group Inc. and the notes will be fungible with the company's existing 4.375% senior unsecured notes due 2024. Cogent will use the proceeds from these notes to repay EUR175 million of its existing senior notes due 2021 and add about $41 million of cash to its balance sheet. "Our 'B+' issuer credit rating and stable outlook on Cogent remain unchanged. Because of the transaction, we expect the company's leverage to increase modestly to about 5.0x, which is below our 5.25x downside threshold for the current rating, from 4.8x as of the 12-months ended March 31, 2020. Despite the increase in its leverage, we believe Cogent has good prospects to reduce its leverage to the mid- to high-4x area in 2020 because of our expectation for high-single-digit percent EBITDA growth supported by 4%-6% top-line growth and continued gross margin expansion," S&P said. ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors -- S&P's simulated default scenario envisions increased competition from broadband and transport service providers that leads to price compression despite the company's volume growth. These factors contribute to lower profit margins that ultimately strain its liquidity and lead to a payment default. -- S&P has valued the company on a going-concern basis using a 5.5x multiple of the rating agency's projected emergence EBITDA. Generally, S&P uses a multiple in the 5x-6x range for fiber infrastructure companies. S&P's default EBITDA multiple estimate is based on the company's ownership of the majority of its fiber under long-term indefeasible rights-of-use agreements (IRUs), which the rating agency views more favorably than short-term leases. Cogent derives a majority of its revenue from long-haul traffic, which S&P views less favorably than metro fiber service providers. Simulated default assumptions" -- Simulated year of default: 2024 -- EBITDA at emergence: $53 million -- EBITDA multiple: 5.5x Simplified waterfall -- Net enterprise value (after 5% administrative costs): $277 million -- Valuation split (obligors/nonobligors): 77%/23% -- Collateral value available to secured creditors: $255 million -- Secured first-lien debt: $457 million -- Recovery expectations: 50%-70% (rounded estimate: 55%) -- Total value available to unsecured claims: $22 million -- Senior unsecured debt and pari passu claims: $387 million -- Recovery expectations: 0%-10% (rounded estimate: 0%) Note: All debt amounts include six months of prepetition interest. COOPER-STANDARD AUTOMOTIVE: S&P Rates $250MM Secured Notes 'B-' --------------------------------------------------------------- S&P Global Ratings assigned its 'B-' issue-level rating and '3' recovery rating to Cooper-Standard Automotive Inc.'s proposed $250 million secured notes due May 2024. The '3' recovery rating indicates its expectation for meaningful recovery (50%-70%; rounded estimate: 50%) in a default scenario. The company will use the proceeds from these notes to add cash to its balance sheet to supplement its liquidity. The security and guarantee package for the notes will be the same as for its existing senior secured term loan B (both are secured by a first lien on non-asset-based lending [ABL] collateral and a second lien on the ABL collateral). At the same time, S&P lowered its issue-level rating on Cooper-Standard's senior secured term loan to 'B-' from 'B' and revised its recovery rating to '3' from '2' because of the increase in the amount of secured debt in its capital structure. The '3' recovery rating indicates S&P's expectation for meaningful recovery (50%-70%; rounded estimate: 50%) in a default scenario. S&P's 'CCC' issue-level rating and the '6' recovery rating on the company's existing senior unsecured notes are affirmed. "Our 'B-' issuer credit rating on parent Cooper-Standard Holdings Inc. is not affected by the new issuance because the improvement in its liquidity will mostly offset the increase in its debt leverage over the next 12 months. Our current base-case forecast assumes the company will have adjusted leverage of over 10x in 2020. That said, we see a reduced likelihood that its leverage will improve toward 6x in 2021 and decline further in 2022. Our outlook remains negative and we could downgrade Cooper-Standard if its cash burn in 2020 will likely exceed $150 million and we do not expect its EBITDA margins to improve in 2021," S&P said. ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors -- S&P's simulated default scenario assumes a payment default occurring in 2022 due to a sustained economic downturn that reduces customer demand for new automobiles, intense pricing pressure from competitive actions by other suppliers, execution challenges related to the ramp-up of new technologies and products, and the loss of one or more manufacturers' business. This, in turn, would hurt Cooper-Standard's ability to generate free cash flow. -- Although the company has leading market positions for the majority of its products, its product mix is relatively narrow and it relies heavily on the production volumes of the North American original equipment manufacturers (OEMs). Therefore, any of the aforementioned stresses could lead to a payment default. -- Based on Cooper-Standard's capital structure, S&P estimates that its EBITDA would need to decline by about 20% to trigger a payment default. At that point, S&P forecasts its cash flow would be insufficient to cover its interest expense, required debt amortization, and nondiscretionary maintenance capital spending. -- S&P assumes a guarantor/nonguarantor split of 70%/30% pro forma for the issuance of the secured notes and the announced divestitures. -- S&P applied a 5x EBITDA multiple to its emergence EBITDA of about $140 million to arrive at the enterprise value. -- S&P believes that if Cooper-Standard were to default its business model would remain viable because of its credible customer base and relatively wide manufacturing footprint. Therefore, S&P believes its debtholders would achieve the greatest recovery value through a reorganization rather than a liquidation. Simulated default assumptions -- LIBOR of 250 basis points (bps) -- A 60% draw under the ABL revolver at default -- Foreign working capital lines are 100% drawn at default and a 60% draw on its securitization facilities -- An increase in the cost of borrowing on the term loan at default to bring the spread over LIBOR to 5%, which is consistent with S&P's recovery criteria given the facility has a financial maintenance covenant. Simplified waterfall -- Gross enterprise value: $614 million -- Administrative expenses: $31 million -- Net enterprise value: $583 million -- Priority claims: $240 million -- Collateral value available to secured creditors: $342 million -- Secured first-lien debt: $655 million -- Recovery expectations: 50%-70% (rounded estimate: 50%) -- Total value available to unsecured claims: Negligible -- Unsecured claims at default: $724 million -- Recovery expectations: 0%-10% (rounded estimate: 0%) Note: All debt includes six months of accrued interest. Ratings List Cooper-Standard Holdings, Inc. Issuer Credit Rating B-/Negative/-- B/Negative/-- New Rating Cooper-Standard Automotive Inc. Senior Secured US$250 mil nts due 2024 B- Recovery Rating 3(50%) Ratings Affirmed; Recovery Expectations Revised Cooper-Standard Automotive Inc. Senior Unsecured CCC CCC Recovery Rating 6(0%) 6(5%) Ratings Lowered; Recovery Ratings Revised To From Cooper-Standard Automotive Inc. Senior Secured B- B Recovery Rating 3(50%) 2(75%) CP VI: Bank Debt Trades at 15% Discount --------------------------------------- Participations in a syndicated loan under which CP VI Bella Topco LLC is a borrower were trading in the secondary market around 85 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The $200.0 million facility is a Term loan. The facility is scheduled to mature on December 28, 2025. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. CPG INTERNATIONAL: S&P Affirms 'B' ICR; Outlook Stable ------------------------------------------------------ S&P Global Ratings affirmed its 'B' issuer credit rating on Illinois-based building products manufacturer CPG International LLC (d/b/a/ The Azek Co.) and the issue-level ratings on its first-lien term loan and existing $315 million senior notes at 'B' and 'CCC+', respectively. S&P removed the ratings from CreditWatch, where it placed them with negative implication on April 1, 2020. At the same time, S&P is assigning its 'CCC+' issue level rating and '6' recovery rating to the new $350 million senior unsecured notes due 2025 issued by CPG. The company intends to use the proceeds to repay its $315 million senior notes due 2021 and a portion of the outstanding ABL balance. For the 12 months ended March 31, 2020, CPG's adjusted leverage was 6.8x and EBITDA interest coverage was 2x. These metrics are in line with S&P's previous expectations. "Although we expect recessionary pressures to cause some deterioration in the company's performance over the next few quarters, we believe credit metrics will remain in line with the current rating level," S&P said. The refinancing of the senior notes addresses a key credit risk. The refinancing of the existing senior notes due 2021, with the new senior notes due 2025, pushes the maturity out by four years. As a result, the company now has no debt maturities until 2022, when the unrated asset-based lending (ABL) facility comes due. Also, the company intends to use some of the excess proceeds from this notes' issuance to repay a portion of its ABL draw. These factors support S&P's view of the company's improved capital structure and its adequate liquidity position. "Our stable outlook on CPG reflects our expectation that the company will maintain debt to EBITDA in the 7x-8x range and EBITDA interest coverage of at least 2x over the next 12 months. We expect CPG to maintain these credit measures despite pressures from recessionary conditions that result in reduced demand and weaker earnings," S&P said. S&P may lower the ratings over the next 12 months, if: -- Business conditions materially deteriorate, leading to a sharp revenue decline, with little prospects of a quick upswing in demand; or -- Margins weaken significantly or EBITDA contracts more rapidly than expected under S&P's base-case scenario, and S&P believes the likelihood of an improvement is low, such that debt to EBITDA rises above 8x and EBITDA interest coverage fall below 2x on a sustained basis Though unlikely in the current environment, S&P could upgrade CPG over the next 12 months if: -- The company deleverages significantly to below 5x; and -- CPG's financial sponsors to commit to maintain leverage well below 5x. CRAFTWORKS PARENT: Offers Buyer $45M Less After COVID-19 Closures ----------------------------------------------------------------- Aisha Al-Muslim of The Wall Street Journal reports that Fortress Investment Group LLC is buying casual dining company CraftWorks Holdins Inc., which operates 338 brewpubs and restaurants, at a discount. According to the report, Craftworks is ready to sell the company to Fortress for $45 million less compared to earlier offer of Fortress, while it aims to reopen as many as 200 restaurants after COVID-19 restrictions are lifted. On May 4, 2020, Craftworks floated a private sale to Fortress worth $93 million that comes in the form of credit bid, meaning Fortress wants to purchase CraftWorks in exchange for cancelling some corporate debt. The proposal, that includes Fortress' assumption of CraftWorks liabilities, is subject to the bankruptcy court's approval as well as higher offers. According to CraftWorks' investment banker Vineet Batra in court documents, it is unlikely that another buyer will top the offer of Fortress during the coronavirus pandemic and its implication on the country's economy. CraftWorks also closed all locations temporarily due to COVID-19 restrictions, putting about 18,000 employees out of work. During a hearing at the U.S. Bankruptcy Court in Wilmington, Delaware, Robert J. Feinstein, who represents CraftWorks' official committee of unsecured creditors, said that the new deal is full of conflicts. In response, the committee plans to hold "true independent" investigation on the alleged conflicts of interests among the board of directors, headed by Centerbridge Partners LP, the private-equity owner of CraftWorks. Moreover, the committee also considers requesting appointment of Chapter 11 trustee regarding purchase contract provisions, Feinstein said. In response to the alleged conflicts, Craftworks lawyer Steven J. Reisman said, "I can assure you that things were done correctly here." According to Judge Brendan Linehan Shannon, he would permit CraftWorks to tap additional bankruptcy funds up to $13.4 million to cover Chapter 11 costs and critical corporate expenses. However, the budget does not include rental payments, said CraftWorks lawyer Peter A. Siddiqui. About Craftworks Parent CraftWorks Parent, LLC and its subsidiaries filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-10475) on March 3, 2020. CraftWorks and its affiliated entities are operators and franchisors of steakhouses and craft beer brewery restaurants with more than 330 locations in 39 states in the U.S. and in Taiwan as of the bankruptcy filing date. CraftWorks employs more than 18,000 team members and corporate and support staff at its restaurants nationwide and at offices located in Nashville, Tennessee and Colorado. Its four largest "core" brands are (a) Logan's Roadhouse, (b) Old Chicago Pizza & Taproom, (c) Gordon Biersch Brewery Restaurant, and (d) Rock Bottom Restaurant and Brewery. In addition, CraftWorks operates unique one-off "specialty" restaurants such as Big River Grille & Brewing Works and ChopHouse & Brewery. CraftWorks was estimated to have $100 million to $500 million in assets and liabilities as of the bankruptcy filing date. CraftWorks filed Chapter 11 proceedings to implement an agreement with its senior lender that is expected to reduce its debt by more than 60%, strengthen liquidity, and better position its popular brands for long-term growth. It has filed a motion requesting approval of a "stalking horse" asset purchase agreement with its senior lender and a competitive bidding process under Section 363 of the Bankruptcy Code. CraftWorks and its affiliated debtors tapped Klehr Harrison Harvey Branzburg LLP as legal counsel; Configure Partners, LLC, as investment banker; M-III Advisory Partners, LP as financial advisor; Hilco Real Estate, LLC as the real estate advisor; and Kekst CNC as the communications advisor. Prime Clerk LLC is the claims agent. The U.S. Trustee for Region 3 on March 12, 2020, appointed a committee to represent unsecured creditors in the Chapter 11 case of CraftWorks Parent, LLC. The Committee retained Pachulski Stang Ziehl & Jones LLP, as counsel and FTI Consulting, Inc., as financial advisor. CRESTWOOD EQUITY: S&P Alters Outlook to Neg., Affirms 'BB-' ICR --------------------------------------------------------------- S&P Global Ratings revised the rating outlook on Crestwood Equity Partners L.P. (CEQP) to negative from stable. At the same time, S&P affirmed the 'BB-' issuer credit rating on the company, the 'BB-' rating on its senior unsecured notes, and the 'B-' rating on its preferred stock. Decreased volume assumptions across Crestwood's gathering and processing (G&P) and storage and transportation (S&T) segments contributes to EBITDA that is materially lower than previously expected. "The recent volatility in the commodity markets due to the OPEC price war, and unprecedented oil and gas demand destruction driven by the COVID-19 pandemic has caused us to revise our volume-related revenue forecasts downward. Volume-related revenue makes up about 70%-75% of CEQP's cash flow. The significant volume declines are sourced from shut-ins from the oil-weighted basins, particularly in the Bakken and Powder River basins, which we expect could potentially continue for the next several months. Crestwood could also offer reduced service fees to affected producer customers facing financial difficulties--which could put further pressure on revenues," S&P said. "We expect CEQP to generate S&P Global Ratings' adjusted EBITDA of about $550 million-$570 million in 2020 with modest growth in 2021. In 2020, we expect the partnership to have adjusted debt to EBITDA of about 5.4x. However, we expect leverage to somewhat decrease in 2021 as the partnership's cash flows improve. Our debt calculations also include $612 million in outstanding preferred units that we treat as 100% debt," the rating agency said. Crestwood's recent acquisition of the NGL storage assets from Plains All American Pipeline L.P. will help offset some of the expected EBITDA decline. On April 1, 2020, CEQP closed on the purchase of strategic NGL terminal assets from Plains All American for approximately $160 million. These demand-pull assets add approximately 7 million barrels of NGL storage and a multiyear supply agreement with Plains, in addition to access to transportation capacity from Mont Belvieu. These assets, which S&P expects will add approximately $35 million to $40 million in cash flow over the next 12 months, will provide additional supply and operational diversification Crestwood's current NGL platform. Crestwood has also taken measures to reduce costs, including approximately a $40 million reduction in operational expenses and selling, general, and administrative expenses (SG&A), and a reduction in their capital-spending budget to about $155 million-$175 million for 2020 including maintenance expenses. The asset acquisition and these cost reductions are important in both moderating leverage and maintaining liquidity over the next 12-18 months. Under S&P's base case scenario, it thinks the company can cover its obligations without the need to access the capital markets over the next 18 months. The next material debt maturity is a $700 million senior unsecured note that matures in 2023. "Our assessment of the partnership's business risk profile remains fair, reflecting the partnership's size and scale, and additional diversity with the recently acquired NGL storage assets. The partnership continues to derive about 83% of its 2020 EBITDA from fixed-fee or take-or-pay contracts. Despite the current downturn, the partnership operates in numerous basins across the U.S., which helps to somewhat mitigate overall volumetric risk. However, the partnership's cash flows still faces some indirect commodity price exposure through volumetric risk, particularly in segments with less long-term contracts and in the absence of minimum volume commitments," S&P said. The negative outlook reflects S&P's view that adjusted leverage at the partnership to be about 5.4x in 2020. S&P expects the partnership to reduce its cash uses over the next 12 months to decrease leverage and further support liquidity; however, the rating agency expects credit metrics will remain elevated over 5.0x over through 2021. "We could consider a negative rating action on CEQP if we no longer expected the partnership's adjusted leverage to be consistently below 5x. This could result from a further deterioration in commodity prices, longer-than-expected shut-ins, or continuing softer demand in the transportation and storage segments. We could also downgrade the partnership if liquidity were to deteriorate such that covenant headroom is significantly eroded," S&P said. "We could revise the outlook to stable if the company is able to decrease leverage such that adjusted debt/EBITDA falls below 5x and remains in that area on a sustained basis during our forecast period. However, we do not envision this occurring in the absence of a reversal of shut-ins in the Bakken and Powder River basins," the rating agency said. CUSHMAN & WAKEFIELD: S&P Rates New Senior Secured Notes 'BB-' ------------------------------------------------------------- S&P Global Ratings said it assigned its 'BB-' issue rating to Cushman & Wakefield's (C&W's) proposed $400 million senior secured issuance. Proceeds from the issuance will be used to fund working capital and for other general corporate purposes. Pro forma, debt to EBITDA will increase to approximately 4.4x, within S&P's expectations for the current rating. S&P believed the additional capital from the issuance is appropriate to the extent it bolsters surplus liquidity, despite the additional leverage, given current macroeconomic conditions. The recovery rating on the senior debt is '3', reflecting its expectation of meaningful recovery (50%-70%; rounded estimate 65%) in the event of default. C&W is a global leader in commercial real estate services. The company provides property owners and tenants with a multitude of property solutions. S&P believes downside risk could arise if the impact to EBITDA from current economic conditions is larger than S&P expects. This would likely stem from larger-than-expected declines in fee revenue generated from the capital markets segment. Relative to peers, C&W has more fee revenue generated from the property management and facilities management segment, which S&P believes to be less volatile in a stress scenario. D & S LAND: Unsecured Creditors Unimpaired Under Plan ----------------------------------------------------- D & S Land Development, LLC, filed a Chapter 11 Plan and a Disclosure Statement. General unsecured creditors (Internal Revenue Service) are classified in Class 1 is unimpaired and will receive a distribution of 100 % of their allowed claims, to be distributed as follows in full over life of Plan. Payments and distributions under the Plan will be funded from the real property owned by the Debtor will be sold in lots. As and when each lot is sold, will be paid to the lien holder. A full-text copy of the Disclosure Statement dated April 29, 2020, is available at https://tinyurl.com/y8vdusjv from PacerMonitor.com at no charge. About D & S Land Development D & S Land Development, LLC, has been in business of real estate land development since 2008. Laurel, Mississippi-based D & S Land Development sought Chapter 11 protection (Bankr. D. Miss. Case No. 20-50164) on Jan. 29, 2020. The Debtor's counsel: Al Shiyou Tel: 601-583-6040 E-mail: shiyoulawfirm@aol.com DIVERSIFIED HEALTHCARE: Moody's Cuts CFR to Ba2, Outlook Negative ----------------------------------------------------------------- Moody's Investors Service downgraded Diversified Healthcare Trust's senior unsecured and corporate family rating to Ba2 from Ba1, concluding the review for downgrade initiated on March 30, 2020. The speculative grade liquidity rating remains unchanged at SGL-3. The outlook is negative. The rating actions reflect the REIT's high leverage, weak liquidity and pre-existing operating challenges that make it particularly vulnerable to risks stemming from the coronavirus outbreak. The following ratings were downgraded: Issuer: Diversified Healthcare Trust Senior unsecured debt to Ba2 from Ba1 Corporate family rating to Ba2 from Ba1 Outlook Actions: Issuer: Diversified Healthcare Trust Outlook changed to Negative from Rating Under Review RATINGS RATIONALE DHC's Ba2 CFR 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 by Five Star under the previous leadership team. Moody's expects DHC to face execution risk with its plans to turn around performance, with the risks now magnified by the coronavirus outbreak. The coronavirus is causing a sharp decline in move-ins and occupancy across the industry, while expense pressure related to labor and supplies is further crimping profitability. DHC's ratings also consider 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 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 weak liquidity position 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 $164mm in various stages of agreement as of early May, but other deals have already fallen out over the past several weeks and Moody's expects it will be difficult to close significant sales volumes in the current market environment. As of 1Q20, the REIT had $415mm available on its $1B unsecured credit facility, but it has since used some of this capacity to redeem $200mm of 2020 bonds. Upcoming maturities include a $250mm term loan due this June and extendable until Dec 2020 and $300mm senior notes due in 2021. Moody's expects the REIT will need external sources of capital to help address these maturities and leverage, which is likely to increase further due to operating cash flow declines in the coming quarters. The negative outlook reflects DHC's constrained liquidity and the risks it faces in its senior housing business, as the coronavirus outbreak is likely to cause acute occupancy and cash flow pressure. Moody's expects DHC's high leverage will increase further due to these challenges. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS DHC's ratings could be downgraded should the REIT fail to materially improve its liquidity position as it approaches upcoming debt maturities. A downgrade would also reflect Net Debt/EBITDA above 7.2x and fixed charge coverage below 2.4x on a sustained basis. An upgrade is unlikely near-term but would likely reflect strong liquidity, Net Debt/EBITDA below 6.5x, sustained positive NOI growth from key business segments and fixed charge coverage above 2.75x. 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. DJL BUILDERS: Unsecureds to Recover 3% Under Plan ------------------------------------------------- DJL Builders, Inc., submitted a Second Amended Combined Plan and Disclosure Statement. Class III shall consist of the unsecured Michigan Building Contract Fund Act claims of certain of the Debtors trade creditors. The MBCF Claims shall be paid in full in 60 equal monthly payments beginning on the 25th day of sixth full month after the Effective Date and continuing on the 25th day of each consecutive month until such claim is paid in full. The Class III claims total approximately $141,825. Class IV will consist of the prepetition general unsecured non priority and non-MBCF Claims against the Debtors, including the trade vendor claims against DJL, the non-priority unsecured claims of the taxing authorities, the claims of factoring companies, credit cards and the general claims against Latawiec. The total claim of this class is $241,469. The Debtors will make a 3 percent distribution to its Class IV creditors on a pro rata basis in 12 equal quarterly distributions beginning on the last business day of the first calendar quarter of 2022 and continuing on the last business day of each consecutive calendar quarter until paid in full. Class V shall consist of the claims of DJL's principal, David Latawiec, in connection with his equity interest in DJL. Within 90 days of the Effective Date, Debtor David Latawiec shall transfer $5,000 to DJL in exchange for the retention of his shareholder interest in DJL. The Debtors propose to fund the Chapter 11 Plan of Reorganization from the cash derived from the operation of DJL's business operations. A full-text copy of the Second Amended Combined Plan and Disclosure Statement dated April 29, 2020, is available at https://tinyurl.com/y86hn8v3 from PacerMonitor.com at no charge. Attorneys for the Debtors: Lynn M. Brimer Pamela S. Ritter STROBL SHARP PLLC 300 East Long Lake Road, Suite 200 Bloomfield Hills, MI 48304-2376 Telephone: (248) 540-2300 Facsimile: (248) 645-2690 E-Mail: lbrimer@stroblpc.com About DJL Builders DJL Builders, Inc., is a Michigan corporation, founded by David J. Latawiec in 2009, which provides home remodeling services to homeowners in southeastern Michigan. David J. Latawiec is the sole shareholder. DJL Builders, Inc., filed a Chapter 11 petition (Bankr. E.D. Mich. Case No. 19-56856) on Nov. 29, 2019. Lynn M. Brimer, Esq. -- lbrimer@stroblpc.com -- at STROBL SHARP PLLC is the Debtor's counsel. EDGEWELL PERSONAL: S&P Rates New $600MM Senior Unsecured Note 'BB' ------------------------------------------------------------------ S&P Global Ratings affirmed its 'BB' issuer credit rating on U.S.-based Edgewell Personal Care Co. and 'BB' issue rating on the existing senior unsecured notes. S&P is also assigning its 'BB' issue rating to the proposed senior unsecured notes. Its recovery rating on the senior unsecured debt is '3', indicating the rating agency's expectation for meaningful recovery (50%-70%; rounded estimate: 65%) in the event of a payment default. Edgewell Personal Care Co. has launched an eight-year $600 million senior unsecured note offering, the net proceeds of which will be used to refinance its $600 million senior unsecured notes due 2021. "We view this as a leverage-neutral transaction. We believe the economic contraction caused by the coronavirus will weaken Edgewell's credit ratios, though not beyond our downgrade trigger, partly because Edgewell has managed shareholder returns conservatively over the last year," S&P said. "The stable outlook reflects our expectation that Edgewell's adjusted leverage will not breach our 4x downgrade trigger, fiscal 2020 free operating cash flow will exceed $100 million, and the company will proactively manage its remaining note maturity," the rating agency said. The company generates satisfactory free operating cash flow (FOCF) and has sufficient cushion on S&P's downgrade trigger to withstand substantial EBITDA erosion over the next 12 months. Over the last year, Edgewell Personal Care Co. has operated at or below its company-defined 3x-3.5x leverage metric; S&P Global Ratings-adjusted leverage is about 3x pro forma for the recent infant and pet care disposal, compared to the rating agency's 4x downgrade trigger. S&P believes Edgewell's conservative behavior was in part due to curtailing shareholder returns ahead of the planned leveraging acquisition of Harry's Inc., which was ultimately terminated following regulators' intention to block the merger on antitrust grounds. S&P expects Edgewell to maintain its conservative posture in 2020, given the heightened economic risk related to the coronavirus. Even with S&P's forecast for a sizable 20% organic adjusted EBITDA decline in 2020, Edgewell's leverage should remain under 4x, and the company should generate over $100 million in FOCF. Edgewell faces tough competition. The company is a relatively small player in the global consumer products sector, and it focuses on consumer staples such as razors, feminine care, and sun and skin care. The wet-shave business drives the company's performance, accounting for about 65% of its operating profit. While its razor production volume is high, Edgewell lacks the overall scale and product diversity compared to Procter & Gamble Co. (P&G), Unilever PLC, and Kimberly-Clark Corp., all of which have substantially greater resources than Edgewell and compete in one or more of its categories. The dynamics of the wet-shave category became more difficult for Edgewell a few years ago as new entrants emerged and industry behemoth Gillette Co. reacted by lowering prices. "Although we assume a more rational wet-shave competitive environment going forward, we do not expect Edgewell to recapture market share, and it will probably continue to cede some share in the U.S. The company's feminine care business has seen a recent uptick in demand due to coronavirus-related pantry loading, though we are not convinced it will be able to sustain growth given intense competition from P&G and Kimberly-Clark," S&P said. "Still, our ratings recognize Edgewell's respectable No. 2 position in the global $20 billion wet-shave category and consistent FOCF generation. We assume that Schick's good brand equity, modest price discount to Gillette, and continued investment in innovation will enable Edgewell to protect its diminished market share," the rating agency said. The stable outlook reflects S&P's expectation that sales and adjusted EBITDA will weaken over the next 12 months, but adjusted leverage will not exceed the rating agency's downgrade trigger. S&P expects Edgewell to generate over $100 million FOCF in fiscal year 2020, maintain adequate liquidity, and exercise conservative financial policies until the economy improves and coronavirus-related risks recede. S&P also assumes Edgewell will proactively manage its debt maturities, specifically the $500 million notes due in May 2022. "We could lower the rating if we forecast that adjusted leverage will exceed 4x on a sustained basis. This could occur if there is a protracted economic downturn--most likely resulting from the existing or future potential coronavirus outbreaks--that leads to reduced shave frequency and increased competition from Gillette and other competitors in this key category. Profits may also decline due to sustained lower spending on sun care--potentially due to reduced vacationing and less time spent outdoors in social gatherings--and other discretionary items such as skin care; increased competition from P&G and Kimberly-Clark in the feminine care space; substantial input cost volatility (including steel); or more aggressive financial policies," S&P said. "Although unlikely over the next year, we could raise our rating if Edgewell successfully navigates the economic disruptions caused by the coronavirus and strengthens its business, resulting in sustained adjusted EBITDA growth, moderate shareholder payments, and adjusted leverage sustained below 3x. This could result from successful project fuel initiatives, lower input costs (namely for steel), and rational competition," the rating agency said. ENERGY ACQUISITION: Bank Debt Trades at 50% Discount ---------------------------------------------------- Participations in a syndicated loan under which Energy Acquisition Co Inc is a borrower were trading in the secondary market around 51 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 67 cents-on-thedollar for the week ended May 8, 2020. The $115.0 million facility is a Term loan. The facility is scheduled to mature on June 26, 2026. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. EUROAMERICAN FOODS: Exclusivity Period Extended to July 11 ---------------------------------------------------------- Judge Donald Cassling of the U.S. Bankruptcy Court for the Northern District of Illinois extended to July 11 the exclusive period for Euroamerican Foods, Inc. to file its Chapter 11 plan of reorganization and disclosure statement. Euroamerican has the exclusive right to solicit votes on any such plan until Sept. 3. About Euroamerican Foods Euroamerican Foods, Inc., sought Chapter 11 protection (Bankr. N.D. Ill. Case No. 20-00305) on Jan. 6, 2020. At the time of the filing, Debtor had estimated assets of less than $50,000 and liabilities of between $500,001 and $1 million. Judge Donald R. Cassling oversees the case. Crane, Simon, Clar & Dan is Debtor's legal counsel. EVIO INC: Incurs $20.7 Million Net Loss in Fiscal 2019 ------------------------------------------------------ Evio, Inc. reported a net loss of $20.67 million on $3.79 million of total revenue for the year ended Sept. 30, 2019, compared to a net loss of $11.94 million on $3.36 million of total revenue for the year ended Sept. 30, 2018. As of Sept. 30, 2019, the Company had $8.39 million in total assets, $20.20 million in total liabilities, and a total deficit of $11.81 million. The Company had cash on hand of $110,325 as of Sept. 30, 2019, current assets of $982,400 and current liabilities of $13,268,665 creating a working capital deficit of $12,286,265. Current assets consisted of cash totaling $110,325, accounts receivable net of allowances totaling $133,022, prepaid expenses totaling $190,460, other current assets of $9,689 and current portion of a note receivable of $538,904. Current liabilities consisted of accounts payable and accrued liabilities of $3,811,237, client deposits of $108,418, convertible notes payable net of discounts of $3,695,484, current capital lease obligations of $957,673, interest payable of $1,387,642, derivative liabilities of $2,545,735, and current portion of notes payable net of discounts of $762,476. During the year ended Sept. 30, 2019, the Company used $2,506,654 of cash in operating activities which consisted of a net loss of $20,669,033, non-cash losses of $16,300,966 and changes in working capital of $1,861,413. Net cash used in investing activities total $353,231 during the year ended Sept. 30, 2019. The Company paid $407,865 for the purchase of equipment and had notes receivable of $761,096 for payments due primarily from Kaycha Holdings for the purchase of Phytatech Note. During the year ended Sept. 30, 2019, the Company generated cash of $2,186,589 from financing activities. The Company repaid $305,781 of capital lease obligations; received $374,000 of cash from the issuance of convertible debenture, $586,000 from the sale of common stock; $1,270,435 in cash from convertible notes payable, net of original issue discounts and fees, repaid loans payable $(36,629), repaid related party notes payable $(112,277), and $410,841 proceeds from related party advances. Subsequent to year ended Sept. 30, 2019, the Company repaid $1,659,341 in convertible notes payable and $525,778 accrued liabilities through conversion into common stock. The Company is uncertain of its ability to generate sufficient liquidity from its operations so the need for additional funding may be necessary. The Company may sell stock and/or issue additional debt to raise capital to accelerate its growth. BF Borgers CPA PC, in Lakewood, CO, the Company's auditor since 2019, issued a "going concern" qualification in its report dated May 18, 2020 citing that the Company has suffered recurring losses from operations and has a significant accumulated deficit. In addition, the Company continues to experience negative cash flows from operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. A full-text copy of the Annual Report is available for free at the Securities and Exchange Commission's website at: https://is.gd/xa2YVJ About EVIO, Inc. EVIO, Inc., formerly Signal Bay, Inc. -- http://www.eviolabs.com/ -- provides analytical testing and advisory services to the emerging legalized cannabis industry. The Company is domiciled in the State of Colorado, and its corporate headquarters is located in Bend, Oregon. FLOYD'S INSURANCE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Floyd's Insurance Agency Inc. 1012 N JK Powell Blvd Whiteville, NC 28472 Business Description: Floyd's Insurance Agency Inc. operates as an insurance agency in Whiteville, North Carolina. Chapter 11 Petition Date: May 20, 2020 Court: United States Bankruptcy Court Eastern District of North Carolina Case No.: 20-01982 Judge: Hon. Joseph N. Callaway Debtor's Counsel: Jason L. Hendren, Esq. HENDREN, REDWINE & MALONE, PLLC 4600 Marriott Drive Suite 150 Raleigh, NC 27612 Tel: (919) 420-7867 E-mail: jhendren@hendrenmalone.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $10 million to $50 million The petition was signed by Joseph W. Floyd IV, 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/kzGhFh FULTON PROPERTIES: Case Summary & 7 Unsecured Creditors ------------------------------------------------------- Debtor: Fulton Properties of Ohio LLC 700 Liverpool Dr Valley City, OH 44280 Business Description: Fulton Properties of Ohio LLC is a Single Asset Real Estate (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: May 20, 2020 Court: United States Bankruptcy Court Northern District of Ohio Case No.: 20-51057 Judge: Hon. Alan M. Koschik Debtor's Counsel: Frederic P. Schwieg, Esq. FREDERICK P SCHWIEG ATTORNEY AT LAW 19885 Detroit Rd #239 Rocky River, OH 44116-1815 Tel: 440-499-4506 E-mail: fschwieg@schwieglaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by John Medas, president. A copy of the petition containing, among other items, a list of the Debtor's seven unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/eSmvGs GMS DINER: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: GMS Diner Corp. d/b/a Six Brothers Diner 475 Route 46 East Little Falls, NJ 07424 Business Description: GMS Diner Corp. -- https://www.sixbrothersdiner.net -- is a family-owned restaurant specializing in American cuisine. The restaurant offers catering services for all occasions. Chapter 11 Petition Date: May 21, 2020 Court: United States Bankruptcy Court District of New Jersey Case No.: 20-16721 Debtor's Counsel: David H. Stein, Esq. WILENTZ, GOLDMAN & SPITZER, P.A. 90 Woodbridge Center Drive Suite 900, Box 10 Woodbridge, NJ 07095 Tel: 732-636-8000 E-mail: dstein@wilentz.com Total Assets: $275,000 Total Liabilities: $1,404,025 The petition was signed by George Stylianou, 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/UPzjbm GNC HOLDINGS: Stockholders Elect 11 Directors --------------------------------------------- GNC Holdings, Inc. held its annual meeting of stockholders on May 18, 2020, at which the stockholders: (i) elected Hsing Chow, Alan D. Feldman, Michael F. Hines, Amy B. Lane, Rachel Lau, Philip E. Mallott, Kenneth A. Martindale, Michele S. Meyer, Robert F. Moran, Alan Wan, and Yong Kai Wong as directors for terms that expire at the Company's 2021 annual meeting of stockholders, or until their successors are duly elected and qualified or until their earlier resignation or removal; (ii) approved, on a non-binding advisory basis, the compensation of the Company's named executive officers as disclosed in the Company's Proxy Statement filed with the Securities and Exchange Commission on April 8, 2020; and (iii) ratified the appointment of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for fiscal 2020. About GNC Holdings GNC Holdings, Inc., headquartered in Pittsburgh, PA, is a global health and wellness brand with a diversified, multi-channel business. The Company's assortment of performance and nutritional supplements, vitamins, herbs and greens, health and beauty, food and drink and other general merchandise features innovative private-label products as well as nationally recognized third-party brands, many of which are exclusive to GNC. The Company serves consumers worldwide through company-owned retail locations, domestic and international franchise activities, and e-commerce. As of March 31, 2020, GNC had approximately 7,300 locations, of which approximately 5,200 retail locations are in the United States (including approximately 1,600 Rite Aid licensed store-within-a-store locations) and the remainder are locations in approximately 50 countries. GNC Holdings reported a net loss of $35.11 million for the year ended Dec. 31, 2019, compared to net income of $69.78 million for the year ended Dec. 31, 2018. As of March 31, 2020, the Company had $1.41 billion in total assets, $1.61 billion in total liabilities, $211.4 million in convertible preferred stock, and a total stockholders' deficit of $402.4 million. PricewaterhouseCoopers LLP, in Pittsburgh, Pennsylvania, the Company's auditor since 2003, issued a "going concern" qualification in its report dated March 25, 2020 citing that the Company has significant debt (specifically the Convertible Notes and the Tranche B-2 Term Loan) maturing at the latest in March 2021. The Company has insufficient cash flows from operations to repay these debt obligations as they come due, which raises substantial doubt about its ability to continue as a going concern. GRAPHIC TUFTING: Hires Gowin Machinery Sales as Appraiser --------------------------------------------------------- Graphic Tufting Center, Inc. and Shae Management, Inc. received approval from the U.S. Bankruptcy Court for the Northern District of Georgia to employ Gowin Machinery Sales to conduct an appraisal of its machinery and equipment. Gowin has agreed to perform the appraisal for a flat fee of $1,200. As part of its engagement, the firm has agreed to provide testimony at any hearing or deposition at an hourly rate of $125. Ken Gowin, an employee of Gowin, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Ken Gowin Gowin Machinery Sales 3439 Mt. View Dr Tunnell Hill, GA 30755 About Graphic Tufting Center Graphic Tufting Center Inc., a privately held company that manufactures carpets and rugs, filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No.20-40033) on Jan. 7, 2020. At the time of the filing, Debtor had estimated assets of less than $50,000 and liabilities of between $1 million and $10 million. Judge Paul W. Bonapfel oversees the case. Cameron M. McCord, Esq., at Jones & Walden, LLC, is Debtor's legal counsel. Debtor filed its Chapter 11 plan of reorganization and disclosure statement on March 24, 2020. GROW CAPITAL: Posts $613K Net Loss in Third Quarter --------------------------------------------------- Grow Capital, Inc. reported a net loss of $613,379 on $565,314 of total revenues for the three months ended March 31, 2020, compared to a net loss of $271,146 on $335,168 of total revenues for the three months ended March 31, 2019. For the nine months ended March 31, 2020, the Company reported a net loss of $1.24 million on $1.93 million of total revenues compared to a net loss of $743,549 on $545,752 of total revenues for the nine months ended March 31, 2019. As of March 31, 2020, the Company had $2.24 million in total assets, $1.67 million in total liabilities, and $566,665 of total stockholders' equity. Going Concern Working capital totaled approximately $127,000 (after removing prepaid stock-based compensation) with approximately $156,000 of cash on hand. The Company believes that as of March 31, 2020 its existing capital resources are not adequate to enable it to fully execute its business plan, including the acquisition of additional operations complementary to its recently acquired subsidiary, Bombshell Technologies. While the Company's subsidiary provided approximately $900,000 in gross profit to offset operational overhead in the period, revenues are presently not sufficient to meet the Company's ongoing expenditures. The Company is actively working to increase the customer base and gross profit in Bombshell Technologies in order to achieve net profitability by the close of fiscal 2020. These growth plans include the acquisition of several new customers, an increase to users currently subscribed to its software, as well as increased sales of customization services to new and existing customers. The Company intends to rely on sales of its unregistered common stock, loans and advances from related parties to meet operational shortfalls until such time as we achieve profitable operations. If the Company fails to generate positive cash flow or obtain additional financing, when required, the Company may have to modify, delay, or abandon some or all of its business and expansion plans, and potentially cease operations altogether. Consequently, the Company said, the aforementioned items raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the financial statements are issued. A full-text copy of the Quarterly Report is available for free at the Securities and Exchange Commission's website at: https://is.gd/vJoJIg About Grow Capital Grow Capital (f/k/a Grown Condos, Inc.) -- http://www.growcapitalinc.com/-- operates as a call center and expanded its business plan to include the development of a social networking site called JabberMonkey (Jabbermonkey.com) and the development of a location based social networking application for smart phones called Fanatic Fans. Grow Capital reported a net loss of $2.40 million for the fiscal year ended June 30, 2019, compared to a net loss of $2.48 million for the fiscal year ended June 30, 2018. As of Dec. 31, 2019, the Company had $2.57 million in total assets, $1.62 million in total liabilities, and $943,879 in total stockholders' equity. L J Soldinger Associates, LLC, in Deer Park, Illinois, the Company's auditor since 2017, issued a "going concern" qualification in its report dated Oct. 15, 2019, citing that the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. GTC WORKS: Gets Court Approval to Hire Stick A Fork as Broker ------------------------------------------------------------- GTC Works, LLC received approval from the U.S. Bankruptcy Court for the District of Arizona to employ Stick A Fork In It, LLC as its broker. Debtor has agreed to compensate the broker for its services in an amount equal to the greater of $15,000 or 10 percent of the sale price. Stick A Fork, doing business as The Restaurant Brokers, is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Reuel Couch Stick A Fork In It, LLC dba The Restaurant Bro 621 S 48th St. Tempe, AZ 85281 Telephone: (480) 491-0123 About GTC Works GTC Works LLC, a company operating a restaurant business, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No. 19-04090) on April 8, 2019. At the time of the filing, Debtor had estimated assets and liabilities of less than $1 million. Judge Paul Sala oversees the case. Kelly G. Black, PLC and James A. Chaston CPA, PLC serve as Debtor's bankruptcy counsel and accountant, respectively. HENRY VALENCIA: Seeks to Hire Ricci & Company as Accountant ----------------------------------------------------------- Henry Valencia, Inc. seeks approval from the U.S. Bankruptcy Court for the District of New Mexico to employ Ricci & Company, LLC as its accountant. Ricci & Company will assist in the preparation of accounting reports and tax returns. The hourly rates charged by the firm and its staff range between $100 and $275. Ricci & Company is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The firm may be reached at: Ricci & Company, LLC 1030 18th Street NW Albuquerque, NM 87104 Telephone: (505) 338-0800 About Henry Valencia Henry Valencia, Inc. is a dealer of Buick, Chevrolet, GMC cars in Espanola, NM. It offers new and pre-owned cars, trucks, and SUVs. Visit https://www.henryvalencia.net -- Henry Valencia sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. N.M. Case No. 20-10539) on March 3, 2020. At the time of the filing, Debtor estimated $1 million to $10 million in both assets and liabilities. Judge Robert H. Jacobvitz oversees the case. Giddens & Gatton Law, P.C. and Hurley, Toevs, Styles, Hamblin Panter, PA are Debtor's bankruptcy counsel and special counsel, respectively. INDUSTRIAL MACHINERY: Ask for June 30 Extension of Plan Deadline ---------------------------------------------------------------- Industrial Machinery Sales & Services, Inc., moves the Court to extend the time to file a plan and disclosure statement. On March 11, 2020, the Court entered an order providing that the Chapter 11 Plan and Disclosure Statement are due by April 30, 2020. The Debtor requires a brief extension of time to file a plan and disclosure statement. The Debtor's business has been affected substantially by the COVID-19 shutdown of business. The Debtor's business is the sale and installation of heavy machinery, and it has been unable to conduct sales and installation on-site at any customer. The Debtor's cash income for December 2019, and January 2020 averaged $55,000 per month ; its income in March was under $1,000. The Debtor needs additional time to determine whether this is ongoing or short-term. The Debtor prays that the time within which to file a plan and disclosure statement be extended to June 30, 2020. About Industrial Machinery Sales Industrial Machinery Sales & Services, Inc., sells industrial machinery, primarily as a manufacturer's representative on a commission basis, and occasionally buys and resells machinery and equipment, as well. Industrial Machinery sought Chapter 11 protection (Bankr. N.D. Ill. Case No. 19-31848) on Nov. 8, 2019 in Chicago, Illinois, listing under $500,000 in assets and under $1,000,000 in liabilities. Judge Benjamin Goldgar is assigned the case. DAVID P. LLOYD, LTD., represents the Debtor. INNOVATIVE WATER: Bank Debt Trades at 90% Discount -------------------------------------------------- Participations in a syndicated loan under which Innovative Water Care Global Corp is a borrower were trading in the secondary market around 10 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 56 cents-on-the-dollar for the week ended May 8, 2020. The $100.0 million facility is a Term loan. The facility is scheduled to mature on March 1, 2027. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. IRB HOLDING: S&P Affirms 'B' ICR on Signs of Restaurant Recovery ---------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on Atlanta-based IRB Holding Corp. (Inspire Brands). At the same time, S&P assigned its 'B' issue-level rating to the company's proposed notes and affirmed its 'B' issue-level rating on its senior secured term loan. The '4' recovery rating reflected S&P's expectation for average recovery (30%-50%; rounded estimate: 45%) in the event of a default. S&P's 'CCC+' issue-level and '6' recovery rating on the unsecured notes is unchanged. The rating affirmation reflects the company's aggressive financial policy and high debt burden. IRB Holding Corp.'s (Inspire Brands) highly leveraged capital structure before the pandemic has resulted in S&P's expectation for leverage well above 10x in fiscal 2020 as sales and profitability erode in the current environment. While the company's business model generally supports higher leverage, S&P believes a prolonged disruption could prove detrimental to the company's competitive standing and financial condition. However, S&P believes the business has shown some resiliency in recent weeks, owing to a diversified restaurant base with exposure to multiple subsegments. S&P expects the company's stronger quick-service restaurant (QSR) brands to support operating cash flow of about $100 million in fiscal 2020 (compared to over $200 million in 2019) despite a challenging environment. Still, S&P believes free operating cash flow (FOCF) could be negative in 2020 due to a sharp pandemic-related performance dip despite the company's reduced capital expenditures. Inspire has historically generated negative FOCF with significant capital investments as part of its growth strategy. S&P continues to expect deteriorating revenue and a spike in leverage in the current fiscal year despite early indications of a recovery. Inspire Brands has reported improving sales trends at each of its restaurant concepts following a trough period at the end of the first quarter. While its Sonic and Arby's concepts have shown resiliency in this environment and have recently reported record weekly sales, comparable sales at the company's most recently acquired brand, Jimmy John's, have lagged overall QSR trends. This weakness is mainly due to its exposure to business centers and college campuses, which remain mostly desolate. Additionally, while Buffalo Wild Wings (BWW) has recovered somewhat, sales remain around 40% below normal levels at the casual dining chain. S&P expects BWW's sales to continue gradually improving as dining rooms begin to open, though the rating agency expects sales to remain well below 2019 levels into fiscal 2021. BWW normally contributes about a third of Inspire's consolidated EBITDA. "Inspire Brands franchises more than 80% of its systemwide units, which we believe provides it with some cushion to weather the downturn because it will not experience the full brunt of operating leverage deterioration. However, we believe the company is at risk of some franchisee attrition, particularly at Jimmy John's, as adverse conditions take a toll on some of its smaller franchise partners," S&P said. Inspire's proposed debt issuance will provide additional liquidity cushion. The company is planning to issue $500 million of senior secured notes to repay its revolving credit facilities and fortify its cash position. The notes will be secured on a pari passu basis with Inspire's term loan facility by a first-priority lien on the company's nonsecuritization assets. In S&P's view, the transaction will improve the company's financial flexibility during a period of heightened uncertainty, while allowing for potential opportunistic investments. Pro forma for the issuance, Inspire's liquidity position of around $1 billion should be sufficient to cover cash burn associated with potential further disruptions such as reinstatements of restaurant restrictions. The negative outlook reflects the impact of an uncertain recovery following the coronavirus pandemic and recessionary environment on Inspire's competitive standing and financial condition. An extended slowdown in customer traffic and consumer spending may introduce additional execution risk and could affect the company's ability to recover operationally. "We could lower our rating on Inspire if we no longer expect a rapid improvement in its credit metrics in 2021. If, for instance, we no longer expect the company's debt to EBITDA to decline to around 8.5x, we could lower our rating," S&P said. "We could revise our outlook on Inspire to stable if its operating conditions improve such that we expect its debt to EBITDA to decline to about 8.5x and believe it will generate consistent good cash flow," the rating agency said. J CREW: Bank Debt Trades at 51% Discount ---------------------------------------- Participations in a syndicated loan under which J Crew Group Inc is a borrower were trading in the secondary market around 49 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 70 cents-on-the-dollar for the week ended May 8, 2020. The $182.4 million facility is a Term loan. The facility is scheduled to mature on March 5, 2021. As of May 15, 2020, $176.9 million of the loan remains outstanding. The Company's country of domicile is United States. J.B. POINDEXTER: S&P Downgrades ICR to 'B+'; Outlook Negative ------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based manufacturer J.B. Poindexter & Co. (JBP) to 'B+' from 'BB-'. The outlook is negative. At the same time, S&P is lowering its rating on the company's senior unsecured notes to 'B+' from 'BB-'. "We expect the company's Morgan division to have an extremely difficult year, partially mitigated by increased demand in its Morgan Olson segment. Morgan, the larger of the two divisions, manufactures truck bodies for class 5-7 trucks in North America. We believe Morgan's performance will be extremely poor this year given a recession along with a trough year in the U.S. truck market. As of early May, chassis production in the U.S. more than halved and demand for delivery of dry goods has fallen drastically. As such, we expect material double-digit revenue declines within this division along with material margin deterioration as result of supply chain disruption," S&P said. Morgan Olson, on the other hand, should continue to perform well in 2020. This division manufactures step vans used by last-mile delivery companies including United Parcel Service and the United States Postal Service. The company has benefited greatly from increased online shopping as consumers shifted their purchasing habits to comply with social distancing measures. To that effect, the company is investing heavily in operations and is building capacity in Danville, Va. S&P thus expects this division to perform well in both 2020 and in 2021. "We thus expect leverage to deteriorate meaningfully in 2020. The company ended its fiscal 2019 with S&P Global Ratings' adjusted leverage of 2.5x. Given the aforementioned macro headwinds, combined with our expectation for meaningful topline deterioration in other divisions and supply chain disruptions, we expect material EBITDA deterioration in 2020. We thus expect the company's adjusted debt to EBITDA leverage to be in the 6x area. Given the company operates in a cyclical industry, however, we expect leverage to improve meaningfully toward the 3x area in 2021 as the economy recovers," S&P said. "JBP enters this period with a solid liquidity position relative to similarly rated peers, though we expect it could deteriorate slightly because of significant capital expenditures this year. The company began 2020 in a good liquidity position with ample cash on the balance sheet and full availability under its $100 million ABL facility. However, we expect the company's profitability to suffer considerably this year as result of being in the trough of the medium-sized truck cycle along with a recessionary environment. Further, the company's capital expenditure spend will be elevated this year given its investment in a new Morgan-Olson facility in Virginia. As a result, we anticipate free operating cash flow (FOCF) will be negative. Still, under our base-case forecast, we believe the company has enough liquidity to weather this challenging period. We will continue to monitor the company's liquidity position should the recessionary environment continue longer than we anticipate," the rating agency said. S&P's negative outlook on JBP reflects its expectation that the company will experience a significant decline in revenues and profitability in fiscal 2020 that will lead to leverage in the 6x area. "We could lower our ratings on JBP if we come to expect leverage to remain above 5x over the next 12 to 18 months; this could happen as result of a longer-than-expected recovery within the medium-sized truck market as result of a prolonged recessionary environment. We could also lower our ratings if the company's liquidity position were to deteriorate more than we currently expect," S&P said. "We could revise our outlook on JBP to stable if the risks of a sustained economic recession recede and the company is able to improve its operating performance such that we expect leverage to remain below 5x over the next 12 to 18 months," the rating agency said. JB AND COMPANY: Proposes May 25 Deadline for Disclosures Objections ------------------------------------------------------------------- JB and Company Chevron, LLC, filed a motion to shorten the deadline for objections to its small business plan and disclosure statement. The Debtor filed a small business plan and disclosure statement on April 20, 2020. In order to comply with the small business timelines, the Debtor requests the Court to reduce the objection deadline for its plan and disclosure statement from 28 days to 21 days. The three-day mailing enlargement prescribed by Bankruptcy Rule 9006(f) would remain, leaving an objection deadline of May 25, 2020. The Debtor seeks a reduction of the objection period because because the major creditors in the case are already aware of the plan and disclosure statement and are considering voting in favor of it. Counsel for the Debtor: Michael K. Daniels PO Box 1640 Albuquerque, NM 87103 Tel: (505) 246-9385 Fax: (505) 246-9104 fax E-mail: mike@mdanielslaw.com About JB and Company Chevron JB and Company Chevron, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.M. Case No. 19-11504) on June 24, 2019. At the time of the filing, the Debtor was estimated to have assets of less than $500,000 and liabilities of less than $1 million. The case is assigned to Judge Robert H. Jacobvitz. Michael K. Davis, Esq., is counsel to the Debtor. KAOPU GROUP: Expects to File its Quarterly Report by June 29 ------------------------------------------------------------ Kaopu Group, Inc., said in a Form 8-K filed with the Securities and Exchange Commission that it will be relying on the SEC Order to delay the filing of its Quarterly Report on Form 10-Q for the three month period ended March 31, 2020 due to the circumstances related to COVID-19. In particular, COVID-19 has caused disruptions to the Company and limited access to its facilities resulting in limited support from its staff. This has, in turn, delayed the Company's ability to complete its quarterly review and prepare the Report. Notwithstanding the foregoing, the Company expects to file the Report no later than June 29, 2020 (which is the first business day following 45 days from the Report's original filing deadline of May 14, 2020). The SEC issued an order under Section 36 (Release No. 34-88318) of the Securities Exchange Act of 1934, as amended, granting exemptions from specified provisions of the Exchange Act and certain rules thereunder. On March 25, 2020, the order was modified and superseded by a new SEC order (Release No. 34-88465), which provides conditional relief to public companies that are unable to timely comply with their filing obligations as a result of the novel coronavirus outbreak. The SEC Order provides that a registrant subject to the reporting requirements of Exchange Act Section 13(a) or 15(d), and any person required to make any filings with respect to such registrant, is exempt from any requirement to file or furnish materials with the Commission under Exchange Act Sections 13(a), 13(f), 13(g), 14(a), 14(c), 14(f), 15(d) and Regulations 13A, Regulation 13D-G (except for those provisions mandating the filing of Schedule 13D or amendments to Schedule 13D), 14A, 14C and 15D, and Exchange Act Rules 13f-1, and 14f-1, as applicable, if certain conditions are satisfied. In light of the current COVID-19 pandemic, the Company will be including the following Risk Factor in its Report: "A pandemic, epidemic or outbreak of an infectious disease, such as COVID-19, may materially and adversely affect our business and operations. "In March 2020, the World Health Organization designated the new coronavirus ("COVID-19") as a global pandemic. Chinese, US, state and local governments have mandated orders to slow the transmission of the virus, including but not limited to shelter-in-place orders, quarantines, restrictions on travel, and work restrictions that prohibit many employees and contractors from going to work. Uncertainty with respect to the economic effects of the pandemic has resulted in significant volatility in the financial markets. Consumer product purchases, including purchases of our services, may decline during this global pandemic. A prolonged downturn or an uncertain outlook in the economy may materially adversely affect our business and our revenues and profits." About Kaopu Group Headquartered in Taichung City 404, Taiwan (R.O.C.), Kaopu Group, Inc. provides consulting services related to pre-need death care through consultancy contracts with small death care service providers in Taiwan. Also, the Company actively sells pre-need death care contracts and insurance products through its own sales force in Taiwan. The Company consults on the purchase of cemetery property and funeral and cemetery merchandise and services at the time of need and on a preneed basis. In addition, the Company specializes in the consultancy for deferred preneed funeral and cemetery receipts held in trust, preneed cemetery activities, preneed funeral activities, preneed funeral and cemetery, burial vaults, cemetery property, and cemetery property revenue. As of Sept. 30, 2019, the Company had $10.66 million in total assets, $10.13 million in total liabilities, and $523,718 in total stockholders' equity. Thayer O'Neal Company, LLC, in Houston, Texas, the Company's auditor since 2016, issued a "going concern" qualification in its report dated April 16, 2019, citing that the Company has suffered recurring losses from operations, has a substantial working capital deficiency and substantial accumulated deficits and comprehensive loss that raise substantial doubt about its ability to continue as a going concern. KEYSTONE PIZZA: Seeks Approval to Hire Spencer Fane as Counsel -------------------------------------------------------------- Keystone Pizza Partners, LLC seeks approval from the U.S. Bankruptcy Court for the District of Kansas to employ Spencer Fane, LLP as its legal counsel. The professional services that the firm will render in connection with Debtor's Chapter 11 case include: (a) advise Debtor regarding the administration of the case and compliance with local rules, procedures, forms, and other matters; (b) advise Debtor with respect to its retention of professionals and advisors; (c) analyze Debtor's assets and liabilities, investigate the extent and validity of liens, and participate in and review any proposed asset sales, asset dispositions, financing arrangements, and cash collateral stipulations or proceedings; (d) advise Debtor regarding its rights and obligations under leases and other contracts; (e) assist in investigating the acts, conduct, assets, liabilities, financial condition and operations of Debtor, the desirability of the continuance of any portion of those operations, and any other matters relevant to the case or to the formulation of a Chapter 11 plan; (f) represent Debtor in connection with any sale of its assets; (g) participate in the negotiation and formulation of any plan of liquidation or reorganization; (h) advise Debtor on the issues concerning the appointment of a trustee or examiner under Section 1104 of the Bankruptcy Code; (i) advise Debtor regarding its powers and duties under the Bankruptcy Code and the Bankruptcy Rules; and (j) assist in the evaluation of claims and represent Debtor in any litigation matters, including avoidance actions. The hourly rates charged by Spencer Fane for its attorneys and paralegals are as follows: Partners $380 – $725 Of Counsel $290 – $575 Associates $260 – $410 Paralegals $130 – $290 The attorneys and paralegals designated to represent Debtor, and their standard hourly rates are: Scott Goldstein (partner) $480 David Miller (partner) $480 Justin Leck (partner) $430 Zachary Fairlie (associate) $340 Lisa Wright (paralegal) $250 The firm received a retainer of $125,000, of which $1,717 was used to pay the filing fee. Scott Goldstein, Esq., a partner at Spencer Fane, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Scott J. Goldstein, Esq. Zachary R.G. Fairlie, Esq. Spencer Fane LLP 1000 Walnut Street, Suite 1400 Kansas City, MO 64106 Telephone: (816) 474-8100 Facsimile: (816) 474-3216 Email: sgoldstein@spencerfane.com zfairlie@spencerfane.com - and – David Miller, Esq. Spencer Fane LLP 1700 Lincoln Street, Ste 2000 Denver, CO 80203 Telephone: (303) 839-3800 Email: dmiller@spencerfane.com About Keystone Pizza Partners Keystone Pizza Partners, LLC, a pizza franchisee in Overland Park, Kansas, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Kan. Case No. 20-20709) on May 3, 2020. At the time of the filing, Debtor estimated $1 million to $10 million in both assets and liabilities. Judge Robert D. Berger oversees the case. Debtor is represented by Spencer Fane, LLP. LEARFIELD COMMUNICATIONS: Moody's Cuts CFR to Caa1, Outlook Neg. ---------------------------------------------------------------- Moody's Investors Service downgraded Learfield Communications, LLC's Corporate Family Rating (CFR) to Caa1 from B3 and Probability of Default Rating (PDR) to Caa1-PD from B3-PD. The first lien credit facility (including a $125 million revolver and term loan B) and the second lien term loan ratings were downgraded to B3 from B2 and Caa3 from Caa2, respectively. The outlook remains negative. Learfield's ratings were downgraded due to an expectation of weak operating performance arising from the impact of the coronavirus outbreak which has limited the ability to hold sporting events and reduced overall advertising spending. As a result, already very high leverage levels will increase substantially and liquidity will deteriorate for as long as college sporting events continue to be disrupted by the pandemic. Downgrades: Issuer: Learfield Communications, LLC Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Corporate Family Rating, Downgraded to Caa1 from B3 Senior Secured First Lien Bank Credit Facility, Downgraded to B3 (LGD3) from B2 (LGD3) Senior Secured Second Lien Bank Credit Facility, Downgraded to Caa3 (LGD5) from Caa2 (LGD5) Outlook Actions: Issuer: Learfield Communications, LLC Outlook, Remains Negative RATINGS RATIONALE Learfield's Caa1 CFR reflects very high leverage of almost 10x as of December 30, 2019 (excluding Moody's standard lease adjustment), which Moody's expects will increase further while liquidity deteriorates in the near term due to weak operating performance. The coronavirus outbreak has exacerbated a difficult environment given the inability to hold college sporting events until the pandemic subsides and lower advertising spending amidst a weak economic environment. Following the merger with IMG College in December 2018, Learfield was already facing a challenging environment from higher multimedia rights costs and lower than anticipated sponsorship revenue after an extended regulatory review process that slowed sponsorship sales. Learfield also has a substantial amount of guaranteed payments over a multiyear period with its college media rights partners and a relatively high level of fixed costs, although the company is likely to attempt to convert many of its fixed obligations to a more variable model going forward. Learfield has limited tangible assets with the company's value driven largely by the intellectual capital of management, long term business relationships, and contracts with college athletic programs and organizations. College football and basketball account for a significant amount of revenue and Learfield's performance would be substantially impacted by a cancellation or delay of the season of either sport. Despite the smaller size of many competitors, competition for collegiate sports rights has been high and colleges have sought increased fees for their media rights historically which can pressure profitability if the higher costs are not offset with growth in sponsorship revenue. Learfield benefits from the strong fan base for college sports and the underpenetrated nature of college media rights compared to professional sports. The merger with IMG College materially increased the size of the college multimedia rights division and provided revenue and cost synergies, but results following the merger were weaker than projected due in part to the uncertainty caused by an extended regulatory review process. Learfield has had good renewal rates with its university base historically, long contract periods, and a substantial amount of pre-sold ad inventory, but operations will be disrupted until the impact of the pandemic subsides. 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 sports industry 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 Learfield's credit profile have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Learfield 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 Learfield of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. A governance consideration that Moody's considers in Learfield's credit profile is its aggressive financial policy historically. Learfield has operated with elevated leverage levels and has pursued several acquisitions including the IMG college merger. In the near term, Moody's expects the company will be focused on preserving liquidity and improving operations. Learfield is a privately owned company. Moody's considers Learfield's liquidity position as weak due to the expectation of negative free cash flow for as long as college sporting events are disrupted. Cash on the balance sheet was $40 million and Learfield has access to a $125 million revolving credit facility due December 2021 with $70 million outstanding as of December 31, 2019. Free cash flow, which has been negative since the acquisition of IMG College, is seasonal with the strongest results posted during the quarters ending in December and March of each year. Learfield is required to make future minimum payments to the universities that it has multimedia rights contracts, but the company has taken steps to minimize the amount and manage the timing of payments to its multimedia rights partners in the near term. Learfield has also taken steps to reduce costs and is projected to remain focused on managing liquidity. The company's liquidity position is projected to deteriorate over the next several quarters and Moody's expects that additional sources of liquidity may be needed if the pandemic continues to restrict the ability to hold sporting events. The revolver has a springing first lien net leverage ratio of 7.5x if more than 35% of the revolver is drawn. The first and second lien term loans are covenant lite. Moody's projects the cushion of compliance with the covenant to tighten over the next few quarters and Learfield may need an amendment to its financial covenant going forward. The negative outlook reflects Moody's expectation that liquidity, revenue and EBITDA will decline due to the coronavirus outbreak's impact on the ability to hold college sporting events and lower sponsorship revenues in the near term which elevates the risk of a default. An inability to hold the college football season as scheduled would also have a substantial impact on performance and liquidity and increase the need for additional sources of funding. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS An upgrade of Learfield's ratings is not likely in the near term due to the very high leverage level and challenging economic conditions due to the coronavirus outbreak. However, ratings could be upgraded if Learfield had an adequate liquidity position with leverage sustained below 7.5x (as calculated by Moody's). All approaching debt maturities would also need to be extended. Ratings could be downgraded further if there was insufficient liquidity which elevated concerns about Learfield's ability to service its debt from issues stemming from the pandemic's effect on operations or if there was a distressed exchange. An inability to obtain an amendment to the financial maintenance covenant applicable to the revolver or extend the maturity of the revolver (matures December 2021) well in advance of the maturity date could also lead to negative rating actions. Learfield Communications, LLC (Learfield) (dba Learfield IMG College) is an operator in the collegiate sports multimedia rights and marketing industry. Atairos Group, Inc. acquired the company in December 2016 from Providence Equity Partners, Nant Capital, and certain members of management. In December 2018, Learfield completed a merger with IMG College. The company is headquartered in Plano, TX with satellite sales offices located on or near college campuses across the country. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. LEGACY JH762: Comerica Bank Objects Disclosure Statement -------------------------------------------------------- Secured creditor Comerica Bank objects to approval of the Joint Disclosure Statement filed by Cassandra Kay Mccord and Legacy JH762, LLC, and in support thereof states: Secured Creditor points out that the Disclosure Statement still fails to provide for clear treatment of the secured mortgage as the provisions of the Disclosure Statement are vague. Secured Creditor further points out that the Disclosure Statement provides contradicting terms. Secured Creditor complains that the Disclosure Statement fails to disclose the correct monthly terms and to provide for the immediate payment of the past-due arrearage. Furthermore, the Disclosure Statement, according to Secured Creditor, fails to provide Secured Creditor with default provisions or relief from stay due to the delinquency. Attorney for Comerica Bank: Neisi I. Garcia Ramirez McCalla Raymer Leibert Pierce, LLC 110 S.E. 6th Street, Suite 2400 Ft. Lauderdale, FL 33301 Tel: 754-263-1065 Fax: 754-263-1065 E-mail: Neisi.GarciaRamirez@mccalla.com About Legacy JH762 LLC Legacy JH762, LLC owns three real properties in Pinehurst, N.C. and Jupiter, Fla., having a total comparable sale value of $5.1 million. Legacy JH762 filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-16308) on May 23, 2019. In the petition signed by James W. Hall, managing member, the Debtor was estimated to have $5,100,100 in assets and $3,456,044 in liabilities. David L. Merrill, Esq., at The Associates, is the Debtor's counsel. LIFEMILES LTD: Moody's Lowers CFR to Caa1, Outlook Negative ----------------------------------------------------------- Moody's Investors Service downgraded to Caa1 from B3 the senior secured and corporate family rating of LifeMiles Ltd. The outlook is negative. RATINGS RATIONALE LifeMiles' downgrade to Caa1 reflects its exposure to the weak credit profile of its controlling shareholder Avianca Holdings, S.A. (Avianca) which announced that it has filed for Chapter 11 protection on May 10. The Caa1 rating also incorporates its expectation that LifeMiles' operation will be temporarily hurt by the global spread of coronavirus affecting consumer spending, traveling and economic growth. LifeMiles' ratings continue to consider its diversified and sticky base of commercial partners and co-brand credit card growth, and strong market position in its territories of operation. The corporate family rating is at the same level as the senior secured rating given that it is the only debt in the company's capital structure. Moody's will continue to monitor the developments regarding Avianca's Chapter 11 filing and its effects on LifeMiles' operation as well as the ongoing impact of the coronavirus outbreak, lower economic growth and weak consumer sentiment on LifeMiles' operation and credit metrics. 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 air passenger travel sector has been one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the exposure of LifeMiles to air travel and overall consumer spending has left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and LifeMiles 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. LifeMiles' gross billings have been affected by the reduction in air travel since late March when most of Avianca's air fleet was grounded following the closure of Colombia's air space to passenger travel. Nonetheless, lower air travel significantly decreases redemption costs, which represent over 80% of LifeMiles' cash costs and operating expenses. LifeMiles' largest contributors to gross billings are its financial partners, which include credit card cobrands (49%) and airlines (29%), being Avianca its largest customer, responsible for approximately 26% of gross billings. As such, Avianca's financial and operating difficulties combined with the effects of coronavirus hurting consumer spending and air travel have hampered LifeMiles' operation. LifeMiles' cash and cash equivalents of $128 million as of March 31, 2020 can cover 2.6x its short-term debt. LifeMiles has posted positive free cash flow over the twelve months ended March 31, 2020 as it has reduced substantially its dividend payout. Nevertheless, the company's liquidity position in the coming quarters will be affected by weaker revenue and be highly dependent on the level of dividends paid. Moody's expects that the company will continue to moderate its dividend payout in 2020, at least while the coronavirus impact persists, to preserve its cash position. The negative outlook reflects its view that the company´s operation and credit metrics can be further affected by the weak credit profile of Avianca and its Chapter 11 filing. It also reflects the downside risks related to the overall impact of coronavirus and weak economic conditions in LifeMiles' territories of operation. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS An upgrade of LifeMiles' ratings would require an improvement in Avianca's credit profile while maintaining its ability to continue operating as a going concern during the Chapter 11 process or once is finalized. An upgrade would also require LifeMiles to maintain ring-fencing provisions that limit cash upstream to shareholders, as well as an adequate liquidity and profitability. Quantitatively, an upgrade would require LifeMiles to maintain its adjusted debt/EBITDA lower than 5.0 times on a sustained basis. LifeMiles' ratings could be downgraded if the company's liquidity deteriorates in particular, through excessive cash distribution to shareholders, or if Avianca's credit profile during or after the Chapter 11 process further deteriorates. Amendments to the loan agreement such that the mandatory prepayment provisions are waived or canceled, and excess cash flow is not used to pay down debt could also result in a downgrade. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. LifeMiles Ltd. is a coalition loyalty program and the solely operator of Avianca's frequent flyer program. LifeMiles has over 600 active commercial partnerships that allow its members to accrue and redeem miles for different products and services such as airline tickets, hotels, and rental cars amongst others. LifeMiles is 70% owned by Avianca Holdings S.A. and 30% owned by Advent Intl. LifeMiles reported gross billings of $328 million over the twelve months ended March 31, 2020. LTMT INC: June 9 Combined Hearing on Plan & Disclosures ------------------------------------------------------- Judge Jack B. Schmetterer has ordered that the combined hearing to consider the approval of the disclosure statement, and on confirmation of the plan filed by LTMT, Inc., will be held at Courtroom 682 of the United States Bankruptcy Court, 219 S. Dearborn St., Chicago, Illinois, on June 9, 2020, at 10:30 a.m. May 29, 2020, is fixed as the last date for filing and serving written objections to the disclosure statement. May 29, 2020, is fixed as the last day for filing ballots accepting or rejecting the plan. May 29, 2020, is fixed as the last day for filing and serving written objections to confirmation. The Debtor's counsel shall file a ballot report by June 3, 2020. About LTMT Inc. LTMT, Inc., is wholly owned and operated by its president, Lorenzo Terrazas. Mr. Terrazas started the company with one truck on May 17, 2013. The company obtained a regular and stable hauling contract for Sterling Lumber and increased its business to the extent that it acquired three more trucks, for a total of four trucks. In November, 2018, new management at Sterling Lumber declined to extend the contract, and compelled the debtor to bid for each load; as a result, the debtor lost most of its revenue. The Debtor began hauling for other contractors, but on a less regular basis, and its customers frequently delayed payment of invoices. In May, 2019, the Debtor attempted to shift its business to long-haul trucking, buying two sleeper trucks for this business, but this solution did not succeed and the Company had to surrender the two new trucks. The Chapter 11 case is In re LTMT, Inc. (Bankr. N.D. Ill. Case No. 19-31890). Judge Jack B. Schmetterer oversees the case. The Debtor is represented by counsel, David P. Lloyd. LULU'S FASHION: Bank Debt Trades at 15% Discount ------------------------------------------------ Participations in a syndicated loan under which Lulu's Fashion Lounge LLC is a borrower were trading in the secondary market around 85 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The $135.0 million facility is a Term loan. The facility is scheduled to mature on August 28, 2022. As of May 15, 2020, $109.7 million of the loan remains outstanding. The Company's country of domicile is United States. M M & D HARVESTING: Gets Approval to Hire Country Boys Auction -------------------------------------------------------------- M M & D Harvesting, Inc. received approval from the U.S. Bankruptcy Court for the Eastern District of North Carolina to employ Country Boys Auction & Realty Co., Inc. to assist in the sale of certain logging equipment and personal property. Country Boys will be compensated as follows: (a) 20 percent of the first $20,000 of personal property sold; (b) 10 percent of the next $50,000 of personal property sold; and (c) 4 percent of the remaining balance of personal property sold. Mike Gurkins, the owner and principal of Country Boys, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Mike Gurkins Country Boys Auction & Realty Co., Inc. 1211 West 5th Street Washington, NC 27889 Telephone: (252) 946-6007 Facsimile: (252) 946-0460 About M M & D Harvesting M M & D Harvesting, Inc. is a North Carolina corporation, with its principal place of business located in Plymouth, N.C. It has been in the logging and hauling business for over 20 years. M M & D Harvesting filed a voluntary petition seeking relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C. Case No. 20-00841) on Feb. 28, 2020, as a small business Subchapter V debtor. In the petition signed by M M & D President Robert M. Holcomb Sr., Debtor disclosed $1,473,377 in assets and $1,458,217 in liabilities. Trawick H. Stubbs, Jr., Esq. at Stubbs & Perdue, P.A., is Debtor's legal counsel. MAJESTIC HILLS: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Majestic Hills, LLC 3625 Washington Pike Bridgeville, PA 15017 Business Description: Majestic Hills, LLC is a privately held company that owns certain property Pennsylvania. Chapter 11 Petition Date: May 21, 2020 Court: United States Bankruptcy Court Western District of Pennsylvania Case No.: 20-21595 Judge: Hon. Gregory L. Taddonio Debtor's Counsel: Donald R. Calaiaro, Esq. CALAIRO VALENCIK 938 Penn Avenue, 5th Fl. Suite 501 Pittsburgh, PA 15222 Tel: 412-232-0930 E-mail: dcalaiaro@c-vlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Joseph DeNardo, manager. 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/BHI6L2 MCBB CORP: Court Conditionally Approves Disclosure Statement ------------------------------------------------------------ Judge Jeffrey P. Norman has ordered that the disclosure statement filed by MCBB Corp.; dba Veritas Steak & Seafood is conditionally approved. June 5, 2020 is fixed as the last day for filing written acceptances or rejections of the plan. Within two days after the entry of this order, the plan, the disclosure statement and a ballot conforming to Ballot for Accepting or Rejecting Plan of Reorganization shall be mailed to creditors. June 11, 2020, is fixed for the hearing on final approval of the disclosure statement and for the hearing on confirmation of the plan. The hearing shall be held at 2:30 p.m. at the United States Courthouse, 515 Rusk St., Courtroom 403, Houston, Texas. June 5, 2020, is fixed as the last day for filing and serving written objections to the disclosure statement and confirmation of the plan. Terms of Plan MCBB Corp. d/b/a Veritas Steak & Seafood filed a Chapter 11 Plan and a Disclosure Statement. Class 2 GEMEC Investments, LLC, for promissory note with remaining balance due of $175,000 is impaired. Allowed amount to be paid from the proceeds of sale and liquidation of assets except for personal property, remainder of claim to be a deficiency claim. Holder will retain its liens. Class 5 Lake Pointe Shopping Center, LP, Claim No. 11 in amount of $475,102 is impaired. Allowed amount to be paid from the proceeds of sale of personal property after payment in full of Classes 1, 3, and 4, remainder of claim to be a deficiency claim. The claim holder will retain its lien. General unsecured, nonpriority claims are not secured by property of the estate and are not entitled to priority. The following identifies the general unsecured, nonpriority claims, which are classified as Class 7 claims: Creditor Name Claim Amount ------------- ------------ Broadcast Music, Inc. $3,398.57 Market Garner, LLC $133,167.29 Lake Pointe Shopping Center, LP $475,102.38 ADT $175.00 ASCAP $3,838.00 CenterPoint Energy $570.84 Fishbowl $789.00 Green Mountain Energy $2,287.00 Jake's Finer Foods $8,000.00 Mario Rios $1,018,419.00 Scott West $5,000.00 Southern Glazer's Wine $1,200.00 Spec's $1,700.00 Windstream Communication $503.00 There are two equity security holders in the Debtor - Mario Rios and Kevin Rios. Each own 50% of the common stock of the Debtor. These interest holders will receive nothing on a account of their equity interests, as the Debtor is liquidating. Payments and distributions under the Plan will be funded by several sources. First and foremost, the Debtor has some remaining cash in its bank accounts from sales prior to closing its operations in February of 2020. Second, the Debtor removed its personal property from its restaurant space and placed those assets into a climate-controlled storage facility. Those assets will be sold and the proceeds used to fund plan payments. Third, the Debtor has a cause of action against two entities that it is pursuing for damages. Last, the individual owners of the Debtor have guaranteed a number of debts and are personally obligated on the sales/use and mixed beverage tax obligations of the Debtor. The individuals will be paying the allowed amount of those debts from their individuals funds. A full-text copy of the Disclosure Statement dated April 29, 2020, is available at https://tinyurl.com/y9fg79ua from PacerMonitor.com at no charge. Attorneys for Debtor MCBB Corp.: Matthew B. Probus WAUSON PROBUS Comerica Bank Building One Sugar Creek Center Blvd., Suite 880 Sugar Land, Texas 77478 Tel: (281) 242-0303 Fax: (281) 242-0306 E-mail: mbprobus@w-plaw.com About MCBB Corp. d/b/a Veritas Steak & Seafood MCBB Corporation owns and operates a steak and seafood restaurant in Sugar Land, Texas known as Veritas Steak & Seafood restaurant. It has been in business since 2010 and has been operating since its inception in the Sugar Land Town Pointe Center at Highway 59 and Highway 6. MCBB Corporation filed a voluntary Chapter 11 Petition (Bankr. S.D. Tex. Case No. 19-37075) on December 30, 2019, and is represented by Matthew B. Probus, Esq., at Wauson Probus. The Debtor reported under $1 million in both assets and liabilities. MEN'S WEARHOUSE: Bank Debt Trades at 63% Discount ------------------------------------------------- Participations in a syndicated loan under which Men's Wearhouse Inc/The is a borrower were trading in the secondary market around 37 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 84 cents-on-thedollar for the week ended May 8, 2020. The $895.5 million facility is a Term loan. The facility is scheduled to mature on April 9, 2025. As of May 15, 2020, $879.4 million of the loan remains outstanding. The Company's country of domicile is United States. MOOD MEDIA: S&P Withdraws 'CCC' Issuer Credit Rating ---------------------------------------------------- S&P Global Ratings withdrew all of its ratings on Mood Media Corp., including its 'CCC' issuer credit rating, at the company's request. At the time of the withdrawal, S&P's outlook on Mood was negative. MSCI INC: S&P Rates New $800MM Senior Unsecured Notes 'BB+' ----------------------------------------------------------- S&P Global Ratings assigned its 'BB+' issue-level rating and '3' recovery rating to New York City-based index and analytics provider MSCI Inc.'s proposed $800 million senior unsecured notes. As with its existing senior notes, MSCI Inc. will be the issuer. The company will use the $800 million of proceeds from these notes to repay all of its 5.75% notes due in 2025. The company will use cash on hand to pay the redemption costs and other fees associated with the offering. The '3' recovery rating indicates S&P's expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in the event of a default. S&P's 'BB+' issuer credit rating on MSCI is unaffected by the issuance. NEW CITIES: Says Plan Disclosure Requirements Satisfied ------------------------------------------------------- New Cities Investment Partners, LLC, filed on April 29, 2020, a Status Update in Support of Approval of the Disclosure Statement dated March 20, 2020. This Status Update's purpose is three-folds: (1) inform the Court about the development of the matters in connection with the Debtor's disclosure statement; (2) inform the Court as to how the Debtor's Disclosure Statement, dated March 20, 2020, satisfies the applicable requirements of 11 U.S.C. Sec. 1125(a) and (b) as is; and (3) inform the Court about the good-faith conference between the Debtor and the party objecting to the disclosure statement, Century Housing Corporation, and proposed changes to the Disclosure Statement as a result therefrom. According to the Debtor, each relevant factor to determine the adequacy of the Disclosure Statement, derived from In re Puff, Bankr. No. 10-01877 2011 WL 2604759, at *4 (Bankr. N.D. Iowa June 30, 2011), is satisfied: Factor One: The events which led to the filing of a bankruptcy petition. The Disclosure Statement provides a concise discussion about the events leading to the filing of the bankruptcy petition in the section entitled "Background." Factor Two: A description of the available assets and their value. The Disclosure Statement provides a description of the Debtor's principal asset, a single asset real estate, and its value. The value of the asset is listed there, too. And the value ascribed to the principal asset is supported by an appraisal report. There is a citation to the docket entry number in the above-caption case containing the appraisal report. Factor Three: The anticipated future of the company. The anticipated future of the Debtor is discussed throughout the Disclosure Statement in varying degrees. They appear in the Disclosure Statement's discussions about the summary of the Plan's treatment, the background of the case, the Plan's treatment on certain classes of claims, and the risk factors of the Plan. Factor Four: The source of information stated in the disclosure statement. The Disclosure Statement does not disclose that much of its source of information is from Plan, this being self evident. Factor Five: A disclaimer. The Disclosure Statement has multiple disclaimers: (1) one in the summary of plan treatment explaining that the claim amount referenced in the Disclosure Statement does not signify NCIP's agreement that those amounts are owed, and those claims are subject to the claims allowance and disallowance process of the Bankruptcy Code. Factor Six: The present condition of the debtor while in Chapter 11. The present condition of the Debtor while in Chapter 11 is presented in the background section of the Disclosure Statement. Factor Seven: The scheduled claims. The Disclosure Statement identifies the scheduled claims as well as the amount claimed in proofs of claims that were filed by the time the Disclosure Statement was finalized. Factor Eight: The estimated return to creditors under a Chapter 7 liquidation. The Disclosure Statement explains that the real estate would not yield any recovery in excess of the costs of the sale and payment on account of the secured debts encumbering if it was sold quickly. Factor Nine: The accounting method utilized to produce financial information and the name of the accountants responsible for such information. The Disclosure Statement does not identify the accounting method utilized to produce financial information. Factor Ten: The future management of the Debtor. The Disclosure Statement explains that the disposition of the subject property will be handled by Mr. Lee Newell and Mr. Blake Peters. Mr. Lee Newell serves as the Chief Executive Officer of New Cities Land Company, Inc., which has a 75% equity interest in Debtor. Factor Eleven: The Chapter 11 plan or a summary thereof. The Disclosure Statement has a section entitled, "Summary of Plan Treatment." That section summarizes the operation and nature of NCIP's plan. Factor Twelve: The estimated administrative expenses, including attorneys’ and accountants' fees. The Disclosure Statement has a section entitled, "Administrative Claims." That section represents the estimated fees of the estate's general bankruptcy counsel, and accountants. Factor Thirteen: The collectability of accounts receivable. The Disclosure Statement does not explain the collectability of notes receivables. Factor Fourteen: Financial information, data, valuations or projections relevant to the creditors' decision to accept or reject the Chapter 11 plan. The Disclosure Statement explains that new financing and new capital must satisfy all the claims in all classes, would be subject to this Court's approval, and would have to be accomplished by a certain time. Factor Nineteen: The relationship of the debtor with the affiliates. The Disclosure Statement in its discussion about the treatment of equity interests in the DIP explains that New Cities Land Company, Inc., holds a 75% interest in NCIP, and Miramonte Development, Inc., holds a 25% interest in NCIP. Therefore, the Disclosure Statement in its current state satisfies Sec. 1125 of the Bankruptcy Code. However, based on the meet and confer with the objecting party, Century Housing Corporation, the Debtor has proposals for additional language in the Disclosure Statement. The sub-headers indicate the concern of the Century Housing Corporation. i. Monitoring Debtor's Efforts to Sell Property, Raise Capital, or Raise Financing. The Debtor is of the view that the deadlines set in its Plan for certain actions and the need for Court approval to proceed with a sale, to obtain new capital, or to finance provides enough monitoring of its case. This is so because there is only a limited amount of options of what the Debtor can do with its property. ii. Liquidation Analysis. The Debtor believes that a liquidation analysis with greater exactitude would require an expert. Under these circumstances, i.e., the pressing need to move as swiftly as possible, the cost to obtain such an expert to validate a commonly held belief that a foreclosure sale would not realize the value of the property to the same extent as an orderly sale of the property, the Debtor believes its liquidation analysis is enough. In addition, no unsecured creditor, who a liquidation analysis would most benefit, objected to the approval of the Debtor's Disclosure Statement. Thus, the Debtor does not propose any additions to the Disclosure Statement on this topic. iii. Valuation of Property During Pandemic. The Debtor does not believe another appraisal is necessary now to take into consideration the impact COVID-19 has on the value of the property. This is so because an additional appraisal would require more costs for the estate, and would delay the plan confirmation process. Thus, the Debtor does not propose any additions to the Disclosure Statement on this topic. A full-text copy of the Status Update dated April 29, 2020, is available at https://tinyurl.com/y9kx7o7t from PacerMonitor.com at no charge. Attorneys for the Debtor: Reno F.R. Fernandez III Daniel E. Vaknin MACDONALD | FERNANDEZ LLP 221 Sansome Street, Third Floor San Francisco, CA 94104-2323 Telephone: (415) 362-0449 Facsimile: (415) 394-5544 About New Cities Investment Partners New Cities Investment Partners, LLC, is engaged in activities related to real estate. The company owns a vacant real property located in Palm Desert, Calif. New Cities Investment Partners sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 19-52584) on Dec. 23, 2019. The petition was signed by Lee E. Newell, CEO of New Cities Land Company, Inc., the Debtor's manager. At the time of the filing, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge M. Elaine Hammond oversees the case. MacDonald Fernandez LLP is the Debtor's legal counsel. NEWELL BRAND: Moody's Rates New $500MM Unsec. Notes 'Ba1' --------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to Newell Brand Inc.'s ("Newell") proposed $500 million senior unsecured 5-year notes. All other ratings for Newell including the Ba1 Corporate Family Rating, the Ba1-PD Probability of Default Rating and the Ba1 rating on the company's existing unsecured debt remain unchanged. The company's SGL-3 Speculative Grade Liquidity Rating, NP commercial paper rating, and negative outlook are also unaffected. Proceeds from the new offering will be used for general corporate purposes, which could include repaying outstanding borrowings under the company's revolving credit facility and securitization facility, as well as repaying existing debt. The offering will bolster the company's adequate liquidity, which includes continued good (although reduced from previous estimates) free cash flow and $1.1 billion available under its $1.25 billion revolving credit facility. Moody's expects efforts to contain the coronavirus will reduce Newell's revenue and earnings, and increase leverage over the next 12 months. However, the Ba1 CFR is unchanged because the company continues to generate good free cash flow and Moody's expects leverage to decline in 2021 when economic conditions improve. Moody's also anticipates Newell's target to reduce debt-to-EBITDA to a 3.0-3.5x range (based on the company's calculation; 5.0x as of March 31, 2020) will guide the use of free cash flow to reduce debt over the next several years. The following ratings/assessments are affected by the action: New Assignments: Issuer: Newell Brands Inc. Senior Unsecured Notes, Assigned Ba1 (LGD4) The rating outlook remains negative. RATINGS RATIONALE Newell's Ba1 CFR reflects the slow pace at which the company is reducing high financial leverage and corporate governance challenges that contribute to evolving strategic priorities. Demand for the company's products will be adversely affected by ongoing competitive pressures, closures at some specialty retailers, private label offerings and governmental recommended social distancing reflecting efforts to contain the coronavirus. Efforts to contain the coronavirus are weakening economic conditions globally and add further operating pressure on Newell. In addition, Moody's views maintaining the dividend despite divestitures that reduce the earnings base as aggressive financial management that is increasing the dividend payout ratio, weakening free cash flow and further impeding deleveraging. Moody's expects debt to EBITDA will increase by to roughly 6.0x in 2020 from 5.0x from the twelve months ending March 31, 2020 and this weakly positions Newell within the rating. The company's large scale, well recognized brands, strong product and geographic diversity, and good free cash flow only partially mitigate these risks. Social factors such as changing consumer preferences toward digital shopping, and intense competition require continual investment in product development, distribution, and sales to maintain market share. Many of Newell's products are discretionary and demand is negatively affected by economic slowdowns. The company will have to navigate in a challenging operating environment to deleverage over the next year given the potential negative effects of tariffs and the coronavirus on the global economy and the company's supply chain. Corporate governance challenges include turnover in the board amid shareholder concerns in 2018, and in senior management that has contributed to changing strategic priorities. The SGL-3 liquidity rating is supported by $476 million of cash (as of March 31, 2020), a largely undrawn $1.25 billion unsecured revolving credit facility expiring in December 2023, $200 million available under its $600 million accounts receivable securitization facility expiring in October 2022 ("short term liquidity facilities") and about $150-$200 million of projected free cash flow (defined as operating cash flow less capital expenditures less dividends) over the next year. Moody's free cash flow assumptions were adjusted from recent 2020 guidance provided by Newell on May 15, 2020, and largely reflect Moody's more conservative working capital assumptions. Newell has sufficient cash factoring in the proposed offering to comfortably fund the $305 million note maturing in August 2020 but could be reliant on its short-term liquidity facilities to fund the $94 million of remaining notes maturing in April 2021 and the approximately $340 million Euro-currency note maturing in October 2021 if free cash flow is weaker than anticipated and the 2021 notes are not refinanced. 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 consumer durables sector has been one of the sectors affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Newell's credit profile, including its exposure to multiple affected countries 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. Newell's ratings and negative outlook in part reflect the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. The negative outlook continues to reflect the uncertainty regarding Newell's ability and willingness to steadily reduce leverage over the next 12 months. This uncertainty reflects the evolving nature of Newell's strategic priorities and turnaround plans, negative effect on demand from store closures and higher unemployment related to the coronavirus, competitive pressures, and management turnover. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING Newell's ratings could be downgraded if the company's operating performance deteriorates, including if sales continue to decline or cost pressures weaken EBITDA. In addition, the ratings could be downgraded if Newell is not making steady progress toward reducing debt/EBITDA (including Moody's adjustments) to 4.5x over the next 12 months, or if free cash flow to debt is below 10%. The ratings could also be downgraded if the company's liquidity deteriorates. Given the negative outlook, an upgrade is unlikely. However, Moody's could upgrade the ratings if Newell substantially improves its operating performance, while maintaining a financial policy that results in debt/EBITDA leverage sustained below 3.75x (with Moody's adjustments). Newell would also need to maintain stronger liquidity, solid free cash flow relative to debt, and a consistent strategic direction to be considered for an upgrade. The principal methodology used in these ratings was Consumer Durables Industry published in April 2017. Newell Brands Inc. is a global marketer of consumer and commercial products utilized in the home, office and commercial segments. Key brands include Rubbermaid, Sharpie, Mr. Coffee and Yankee Candle. The publicly-traded company generated $9.6 billion of revenue for the 12 months ended March 2020. NEWELL BRANDS: Fitch Affirms 'BB' LongTerm IDR, Outlook Negative ---------------------------------------------------------------- Fitch Ratings has affirmed Newell Brands Inc.'s (Newell; NWL) Long-Term Issuer Default Rating (IDR) at 'BB'. The Rating Outlook is Negative. Fitch has also assigned a 'BB'/'RR4' rating to its proposed $500 million senior unsecured notes. The Negative Outlook reflects elevated leverage (total debt/EBITDA) of 4.4x following the completion of its asset divestiture program and ongoing topline challenges in a number of its categories. The ratings also reflect significant business interruption from the global coronavirus pandemic and potential for a downturn in discretionary spending that Fitch expects could extend well into 2021, which in turn could derail further deleveraging. Fitch expects that EBITDA could trend below $1 billion in 2020 on mid-teens sales declines, versus $1.34 billion reported in 2019. Total debt/EBITDA could increase to over 6x in 2020 before returning to under 4.5x in 2022, assuming EBITDA in the $1.2 billion range in 2021/2022 and paydown of upcoming debt maturities. A more protracted or severe downturn or incremental debt issuance could lead to further negative rating actions. KEY RATING DRIVERS Operational Challenges Continue: Newell's core sales declined 1.9% in 2019, with growth in baby and writing, home fragrance, and connected home and security (collectively 45% of revenue); in 2018 only connected home and security showed positive growth. The remaining businesses, food and commercial businesses (23% of net sales), appliances and cookware (17.4% of revenue) and outdoor and recreation (14.5% of revenue), remain challenged due to lack of innovation and execution issues. Fitch expects that turning around these businesses could take a few quarters, and it expected core sales to decline 2% in 2020 and 2021 prior to the recent disruption from the coronavirus pandemic and slowdown in discretionary spending. Here is a summary of the 2019 performance of the four main segments that Newell reports: Newell's learning and development category (30.4% of 2019 revenue; 51% of segment EBIT) declined by 0.8% in 2019 (positive 1% on a core sales basis), driven by softening trends in the writing business related to softening sales of slime-related adhesive products that was offset by growth in international sales. This segment includes baby and parenting sales of $1.1 billion and writing revenue of $1.9 billion. The food and commercial category (23.1% of 2019 revenue; 28% of segment EBIT) declined 6.6% (4.4% on a core revenue basis), with higher declines in the commercial business, volume declines at certain major retailers and softness in the food storage/preserving categories. Food sales were approximately $840 million, and commercial sales were $1.4 billion in 2019. The home and outdoor category (29.1% of 2019 revenue; 15% of segment EBIT prior to corporate expenses) declined 4.2% in 2019 (or 1.4% on a core sales basis) due to the exit of 75 underperforming Yankee Candle retail stores, a product recall in the outdoor and recreation business and the loss of a key U.S retail distributor. Home fragrance was $1 billion, outdoor and recreation was $1.4 billion and connected home and security was $377 million in 2019. The appliance and cookware category (17.4% of 2019 revenue of $9.7 billion; 6% of segment EBIT) declined 7.0% in 2019 (5.1% on a core sales basis) due to loss of domestic market share to competitors. Coronavirus Pandemic: Fitch expects the impact on revenues to the consumer discretionary sector from the coronavirus pandemic to be unprecedented, as mandated or proactive temporary closures of retail stores in "non-essential" categories severely depresses sales. Numerous unknowns remain, including the length of the outbreak; the timeframe for a full reopening of retail locations and the cadence at which it is achieved; and the economic conditions exiting the pandemic, including unemployment and household income trends, the impact of government support of businesses and consumers and the impact the crisis will have on consumer behavior. Fitch increasingly expects a downturn in discretionary spending that could extend well into 2021. Given the combination of these factors, Fitch expects Newell's revenue to decline in the mid-teens in 2020 to $8.2 billion. Fitch expects sales to decline 25% in the second quarter, similar to the declines Newell saw in April, and decline around 10% in second-half 2020. Sales could potentially improve to $8.9 billion to $9 billion in 2021, but still be 8% below 2019 levels. First quarter sales declined 7.6% with core sales (ex. forex) declining 5.1%. In the month of April, Newell saw an approximately 25% decline in revenue due to supply chain disruptions, retail closures of specialty chains and department stores leading to a sharp decline in retail orders which more than offset sales increases in mass and online channels, and shifts in consumer purchase patterns. While the food and commercial business was up 3% in the first quarter, writing, outdoor & recreation, home security and baby categories, were down significantly with some areas down double digits. The home fragrance business ($1 billion in revenue in 2019) was adversely impacted given the temporary closures of 475 Yankee Candle retail stores. The company has also seen supply disruptions which contributed to sales declines in April. The company had to temporarily suspend operations in 20 facilities, notably Yankee Candle in Massachusetts, the writing plant in Mexicali and Sistema in New Zealand to comply with local government guidelines. EBITDA Could Trend Below $1 Billion in 2020: Newell's ongoing 2019 EBITDA was $1.3 billion, with an EBITDA margin of approximately 13.8%. This compares with $2.5 billion in EBITDA with 17% plus margins in 2017 prior to its asset sales. Fitch now expects that EBITDA could decline to under $1 billion in 2020 due to mid-teens sales declines and EBITDA margin compression before improving to $1.2 billion in 2021. The company has previously discussed a several-hundred basis point (bp) improvement opportunity in gross margin and operating costs based on industry benchmarking, with a long-term target of driving sales growth in the low single digits and operating margin improvement of 50 bps annually. Given the ongoing sales challenges in a number of categories and investments required to support these brands, Fitch sees little upside over the next couple of years, even prior to the disruption from the coronavirus pandemic. Leverage Remains Elevated: Newell's 2019 gross debt/EBITDA was 4.4x, given $1.3 billion in ongoing EBITDA. Fitch expects leverage could increase to over 6.0x in 2020 given a decline in discretionary consumer spending before returning to under 4.5x in 2022, assuming EBITDA of $1.2 billion in 2021/2022. This also assumes the paydown of 2020 debt maturities of approximately upcoming maturities of approximately $440 million in 2021 and $$250 million in 2022, with the August 2020 maturity of approximately $300 million being paid down with the new debt issuance and cash on hand. Divestitures Complete: Given integration issues with Jarden following its 2016 acquisition, Newell had announced an Accelerated Transformation Plan in January 2018 to produce approximately $10 billion of after-tax proceeds from divestitures. The company had expected to divest eight business representing approximately 35% of net sales, including three large industrial and commercial product assets (Waddington, Consumer & Commercial Solutions and Process Solutions) and five noncore consumer businesses (Team Sports, Beauty, U.S. Playing Cards, Jostens and Pure Fishing). The plan would result in an approximate $9 billion portfolio of seven large consumer-facing divisions (appliances and cookware, writing, outdoor and recreation, baby, food, home fragrance and safety and security). In August 2019, the company announced its decision to no longer pursue the sale of its Commercial Products business (which includes its Rubbermaid Outdoor, closet, refuse, garage and cleaning businesses). The company stated that it based its decision on the strength of the brand, its competitive positioning in a growing category and track record of cash flow, revenue and margin growth. In November 2019, the company announced it would no longer pursue the sale of its Mapa/Spontex and Quickie businesses. The decision to keep these businesses was based on their financial profiles relative to expected sales proceeds. Divestitures in 2018: In 2018, Newell sold five businesses -- The Waddington Group, Rawlings, The Goody business, Pure Fishing and Jostens -- with combined 2017 revenue of $2.6 billion, or close to 50% of businesses targeted for sale, and received $5.1 billion in net proceeds. Divestitures in 2019: In 2019, Newell sold three businesses -- Process Solutions, Rexair and U.S. Playing Cards -- with combined 2018 revenue of $875 million and received $955 million in net proceeds. The company completed its divestiture program in December 2019, netting a total of $6.1 billion in after-tax proceeds from its asset sale program. The company paid down approximately $5 billion in debt over 2018 and 2019 and completed $1.5 billion in share buybacks in 2018 with proceeds from the asset sale. Newell has an Environmental, Social and Governance (ESG) Relevance Score of 4 for 'Financial Transparency'; this has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors. This reflects a number of factors, including: material weaknesses in internal control over financial reporting in its 2018 and 2019 10Ks, related to tax accounting with regard to its divestiture program; an SEC subpoena in January 2020 related to the impairment of goodwill and other intangibles in 2018; and difficulty in ascertaining the company's ongoing EBITDA given a number of reclassifications of continuing versus discontinued operations over 2018 and 2019. DERIVATION SUMMARY Newell's rating and Negative Outlook reflect elevated leverage (total debt/EBITDA) of 4.4x following the completion of its asset divestiture program and ongoing topline challenges in a number of its categories. The ratings also reflect the significant business interruption from the coronavirus pandemic and the potential of a downturn in discretionary spending that Fitch expects could extend well into 2021, which in turn could derail further deleveraging. Fitch expects that EBITDA could trend below $1 billion in 2020 on mid-teens sales declines, versus $1.34 billion reported in 2019. Total debt/EBITDA could increase to over 6x in 2020 before returning to under 4.5x in 2022, assuming EBITDA in the $1.2 billion range in 2021/2022 and paydown of upcoming debt maturities. A more protracted or severe downturn or incremental debt issuance could lead to further rating actions. Hasbro's 'BBB-'/Negative ratings reflect the company's elevated leverage profile following the acquisition of Entertainment One Ltd. (eOne) for $4 billion plus transaction expenses. As of YE 2019, pro forma gross debt/EBITDA was nearly 5x and is expected to trend to the mid-3.0x range within 24 months post-acquisition close on synergy achievement. The Negative Outlook reflects concerns that gross debt/EBITDA could be sustained above 3.5x. Therefore, the ratings could be stabilized with greater confidence that a combination of good organic growth, synergy achievement and debt reduction could yield gross debt/EBITDA below 3.5x, as appropriate for the 'BBB-' rating. Spectrum's 'BB'/Stable rating reflects the company's diversified portfolio across products and categories, strong brand portfolio, financial discipline evidenced by its public commitment to maintain net leverage (net debt/EBITDA) at or below 3.5x over the long term, expectations for stable to low single-digit organic revenue growth, solid profitability (with an EBITDA margin of approximately 15% pro forma from the divestitures of the Global Batteries and Global Autocare divisions) and historically consistent FCF. These positive factors are offset by strong competition, profit margin pressures across three of its four core segments, the company's acquisitive nature historically and potentially greater overall business cyclicality due to the increased contribution from Hardware and Home Improvement to total company EBITDA following divestitures. ACCO Brands Corporation's rating of 'BB'/Stable reflects the company's leverage around 3.0x gross debt to EBITDA. The ratings are constrained by secular challenges in the office products industry in North America, Europe and Australia. The company has taken steps over the last few years to manage costs given pressures on U.S. organic growth and has executed well on diversifying its customer base toward higher growth, higher-margin channels in North America, as well as acquisitions in international markets. This has led to EBITDA in the $250 million-$300 million range and FCF generation of $100 million-$150 million annually over the 2016-2019 period. Mattel's 'B-'/Positive rating reflects execution risk in stabilizing revenue and growing EBITDA from depressed levels. Mattel continues to face revenue pressures involving its Fisher-Price, Thomas and Friends and American Girl segments, which collectively generated approximately $1.4 billion or around 30% of total gross revenue in 2019. EBITDA in 2019 was approximately $450 million, up materially from 2017-2018 but around half of the $900 million range reported as recently as 2015-2016. FCF turned materially negative in 2016, and continued EBITDA declines led gross leverage (debt/EBITDA) to peak around 11.0x in 2017-2018. The Positive Outlook reflects increasing confidence that Mattel's cost-reduction program and sales initiatives could yield stabilizing topline results and EBITDA improving above $500 million, at which point Mattel could generate sustainably positive FCF as cash restructuring expenses subside. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- Revenue declining to $8.2 billion in 2020 from $9.7 billion in 2019. 2021 revenue to improve to $8.9 billion, but still be 8% below 2019 levels assuming a slowdown in discretionary spending extends well into 2021. Revenue growth in the low single digits beginning 2022; -- Operating EBITDA to decline to under $1 billion in 2020 versus reported EBITDA of $1.34 billion in 2019. EBITDA to improve to $1.2 billion level in 2021/2022; -- Capex around $225 million to $250 million and dividends at around $390 million annually; -- FCF (after dividends) expected to be around $150 million in 2020, reflecting some working capital benefit and approximately $100 million in 2021 and 2022; -- Total debt/EBITDA increasing to over 6.0x in 2020 from 4.4x in 2019 before returning to under 4.5x in 2022. The company's upcoming debt maturities include approximately $300 million due in August 2020, $440 million in 2021 and $250 million in 2022, which could be paid down with FCF and revolver borrowings; alternatively, the company could seek external financing. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: - A stabilization case would require Newell to meet Fitch's revised projections that include EBITDA of $1.2 billion in 2021/2022 and total debt/EBITDA returning to under 4.5x from a projected 5.0x in 2020; - A positive rating action could result from sales growing positive in the low single digits, in turn driving EBITDA back toward $1.3 billion with EBITDA margins in the mid-teens. The company would also need to generate positive FCF on a sustained basis and continue to pay down debt, such that leverage was under 4.0x. Factors that could, individually or collectively, lead to negative rating action/downgrade: - A negative rating action could result from lower-than-expected debt reduction, due to either weaker FCF generation or a change in financial policy or a more protracted or severe downturn leading to reduced confidence in Newell's ability to return to top line and profitability growth in 2022 such that adjusted debt/EBITDAR is sustained above 4.5x. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: As of March 31, 2020, Newell maintained $476 million cash on hand and a $1.25 billion unsecured revolving credit facility (RCF) that expires in December 2023. Net availability under the RCF was approximately $1.2 billion (after netting out outstanding letters of credit and $40 million in CP outstanding). In April 2020, the company borrowed $125 million under its RCF with a portion used to repay CP borrowings. In addition, Newell has a $600 million account receivable securitization facility that matures in October 2022; as of March 31, 2020, there were $290 million borrowed under this facility. Fitch projects FCF (after dividends) of $150 million in 2020, reflecting some working capital benefit, and FCF to average approximately $100 million in 2021 and 2022. The company's upcoming debt maturities include approximately $300 million due in August 2020, $440 million in 2021 and $250 million in 2022, which could be paid down with FCF and revolver borrowings; alternatively, the company could seek external financing. RECOVERY CONSIDERATIONS Fitch does not employ a waterfall recovery analysis for issuers assigned ratings in the 'BB' category. The further up the speculative grade continuum a rating moves, the more compressed the notching between the specific classes of issuances becomes. Newell's capital structure is unsecured, including its revolver and notes. As a result, Fitch has assigned 'BB'/'RR4' ratings across Newell's capital structure, indicating average (31%-50%) recovery prospects. ESG CONSIDERATIONS Newell has an Environmental, Social and Governance (ESG) Relevance Score of 4 for 'Financial Transparency'; this has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors. This reflects a number of factors, including: material weaknesses in internal control over financial reporting in its 2018 and 2019 10Ks, related to tax accounting with regard to its divestiture program; an SEC subpoena in January 2020 related to the impairment of goodwill and other intangibles in 2018; and difficulty in ascertaining the company's ongoing EBITDA given a number of reclassifications of continuing versus discontinued operations over 2018 and 2019. NIELSEN FINANCE: Moody's Rates $500MM Term Loan B Due 2025 'Ba1' ---------------------------------------------------------------- Moody's Investors Service has affirmed Nielsen Holdings plc Ba3 Corporate Family Rating, Ba3-PD Probability of Default Rating and Ba1 ratings on the senior secured bank credit facilities at Nielsen Finance LLC. Concurrently, Moody's assigned a Ba1 rating to the new term loan B facility to be issued by Nielsen Finance and Nielsen Holding and Finance B.V., a Dutch borrower. Moody's also downgraded the ratings on the senior unsecured notes at Nielsen Finance and The Nielsen Company (Luxembourg) S.a.r.l. to B2 from B1. The outlook remains negative. Nielsen Finance and Nielsen Holding and Finance B.V are indirect wholly-owned subsidiaries of Nielsen. Moody's expects the new term loan B facility to total $800 million, comprising a $500 million US dollar tranche and $300 million US dollar equivalent Euro tranche, both maturing Junes 2025. Terms will be substantially similar to Nielsen's existing term loan B. Net proceeds will be used to repay the $800 million 4.5% senior unsecured notes due October 2020 residing at Nielsen Finance and Nielsen Finance Co. (co-borrower). Though senior secured debt will increase to nearly 60% of total pro forma debt from 49%, the higher proportion does not impact the secured debt instrument ratings under Moody's Loss Given Default framework. However, the senior unsecured debt ratings were downgraded by one notch to B2 due to this class of debt's proportionately lower mix relative to the senior secured obligations resulting in a higher loss absorption in a distress scenario. The Ba1 ratings on the senior secured credit facilities are two notches above the Ba3 CFR to reflect their security interest in substantially all assets of the company's wholly-owned material domestic subsidiaries and effective priority relative to the senior unsecured notes. The B2 ratings on the senior unsecured notes reflect their lack of security interest in collateral and structural subordination to the secured debt obligations. The transaction is leverage neutral since Moody's expects Nielsen to use the net proceeds to repay the $800 million 4.5% senior unsecured notes at maturity. Moody's views the transaction favorably given the extension of the debt maturity structure. RATINGS RATIONALE The negative outlook reflects the impact that the novel coronavirus (a.k.a. COVID-19) pandemic will have on Nielsen's operating and financial performance in 2020. While roughly 70% of Nielsen's revenue is tied to contracts that are one year or longer in length (many with leading blue chip companies), the remaining 30% is short-cycle non-contractual revenue, which will experience pressure due to projects associated with sectors of the economy that have been impacted by coronavirus restrictions. Examples include the: (i) cancellation or postponement of major sports events, which restricts Nielsen ability to provide measurement services; and (ii) significant decline in new automobile production, which will reduce demand for the Gracenote subsidiary's music, video and sports metadata and automatic content recognition technologies that are licensed to suppliers of infotainment systems and car stereos, which are eventually sold to automakers. Moody's estimates just under 30% of Nielsen's long-term contracts are up for renewal in 2020. While Moody's expects the vast majority of these agreements will be renewed, some could experience delays, reduced purchases or pricing pressures given the company's large exposure to consumer-packaged goods (CPG) and media companies, two sectors experiencing spending pullbacks due to the effects of COVID-19 on their financial performance. The numerous uncertainties related to the social considerations and economic impact from COVID-19 on Nielsen's cash flows, leverage and liquidity are also embedded in the negative outlook. The magnitude of the impact will depend on the depth and duration of the pandemic and the impact that government restrictions to curb the virus will have on consumer and corporate behavior. The negative outlook reflects Moody's expectation that Nielsen's constant currency organic revenue growth will contract in the mid-single digit percentage range over the coming year and adjusted EBITDA margins will migrate to the low end of the 27% to 30% range. The outlook also captures Moody's view that financial leverage as measured by total debt to EBITDA will increase temporarily above the downgrade threshold to 5.4x (Moody's adjusted, including one-time separation and restructuring costs) compared to 4.6x at March 31, 2020 arising from the challenged operating environment. Moody's projects a global economic recession this year with the US and G-20 advanced economies contracting 5.7% and 5.8%, respectively. As the virus threat is contained and economic growth gradually returns in 2021, Moody's projects leverage will decline to the 4.5x area by the end of next year. Nielsen's Ba3 CFR reflects the company's leading international positions within its Global Media and Global Connect operating segments; relatively high entry barriers with high client switching costs; long-standing contractual relationships across its diverse client base; and solid EBITDA margins. Nielsen has sustained historical margin pressure in its Connect business from: (i) slowing revenue growth amid a competitive landscape, (ii) reduced spend from CPG clients, and (iii) growth in e-commerce and private label sales, coupled with investments in the Media business to adapt to shifts in advertising spend and changes in consumer viewing habits. The company faces further challenges from ongoing cyclical and secular spending pressures from certain client verticals both in the US and abroad; proliferation of new technologies that alter consumer buying habits and advertising/marketing delivery channels; moderately high financial leverage; diminished operating cash flow stemming from EBITDA weakness; and a historically shareholder-friendly capital allocation strategy due to sizable dividends, though materially reduced going forward. Moody's believes Nielsen's contractual revenue, which accounts for around 70% of the total, will provide some cushion against client spending pullbacks. Nonetheless, with the global economy facing recession this year and the prospect of extended business closures, layoffs and high rates of unemployment, an erosion of consumer confidence will lead to a reduction in discretionary consumption. Given these economic realities, even if client spending in short-cycle products (roughly 30% of total revenue) rebounds later this year, Moody's expects demand will be weak. Moody's expects some clients in more challenged sectors such as CPG, automotive and non-grocery retail will reduce or delay their purchases. Clients with weak liquidity and based in countries or regions more severely impacted by the coronavirus will likely seek to extend payment terms, which could negatively impact working capital and lead to an increase in Nielsen's cash conversion cycle. Nielsen's end market exposure to client sectors less affected by the virus will partially offset softness in more challenged sectors. They include food and beverage, supermarkets, healthcare, pharmacies, telecom, financial services and in-home entertainment and media. Web-based providers will likely experience an increase in demand due to extended stay-at-home orders as consumers increasingly engage in online activities such as ad-supported video streaming, internet and mobile gaming, social media and e-commerce. Moody's expects Nielsen to take temporary cost actions to eliminate approximately $200 million of operating costs in the short-run as well as additive permanent cost reductions. Areas that will be curtailed include, travel and entertainment, merit pay, bonuses and company 401(k) match. Other cost actions include furloughs, hiring freezes and reduction of certain variable operating expenses. While Nielsen has relatively good geographic diversity, with roughly 57% of sales derived from the US, 21% from EMEA and 13% from Asia-Pacific, since the coronavirus pandemic is global, it will affect economic activity in nearly every region where the company operates. The impact to the company's financial performance will mirror the timing of the outbreak and economic shutdown in each region. Europe and the US will mostly impact Nielsen's performance in Q2 2020 and potentially in Q3 2020, offset by Asia-Pacific returning to growth. On November 7, 2019, Nielsen announced plans to spin off Connect into a new publicly traded standalone entity by distributing the business unit's shares to shareholders. The transaction is expected to be completed by the end of Q1 2021. Nielsen also reduced its quarterly cash dividend to $0.06 per share from $0.35 per share to improve cash generation. This equates to an annual dividend of approximately $84 million. Factoring in one-time cash separation costs estimated at roughly $300 million as well as $200 million of projected annualized cost savings, Moody's projects Nielsen will produce adjusted free cash flow this year in the range of $90 - $120 million (defined as cash flow from operations less capex less dividends). An expected cash distribution from the completed spin-off would be applied towards repayment of Media's debt. Following the Connect separation, the remaining Media business will continue as a publicly traded company ("Nielsen RemainCo"). While Moody's views the pending separation favorably given the prospects for debt reduction, enhanced free cash flow generation and improved organic revenue growth in 2021, as more information becomes available, Moody's will evaluate Nielsen RemainCo's pro forma debt capital structure, leverage target and financial strategy, as well as the impact and timing of expected transition costs on EBITDA and cash flows. Moody's assessment will also consider that Nielsen RemainCo will become a more narrowly focused business with reduced revenue and profitability after the spin-off. Over the next 12-15 months, Moody's expects Nielsen to maintain good liquidity (SGL-2 Speculative Grade Liquidity) supported by positive, albeit weakened, free cash flow generation in the range of 1% of total debt (Moody's adjusted), solid cash levels (cash balances totaled $359 million at March 31, 2020) and access to its $850 million revolving credit facility ($135 million outstanding at March 31, 2020). Moody's expects the $800 million 4.5% senior unsecured notes maturing in October will be repaid with proceeds from the new term loan B financing. Moody's will closely monitor the covenant headroom under Nielsen's credit facility, which contains a maximum quarterly maintenance covenant of 5.5x total net debt to EBITDA (as defined in the bank credit agreement). While the company was in compliance with a 20% cushion at March 31, 2020, headroom could decrease as a result of EBITDA shortfalls or reduced cash balances. If the covenant cushion tightens over the coming quarters, Moody's expects the company will seek to obtain waivers from its banks. ESG CONSIDERATIONS 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 consumer measurement and data analytics sector has been one of the sectors affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Nielsen's credit profile, including its exposure to sports events and consumer packaged goods, media, broadcasting and automotive sectors, as well as to US, European and Asian economies, have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Nielsen remains vulnerable to the outbreak's continuing spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Its action reflects the impact on Nielsen 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 The rating outlook could be revised to stable if financial leverage declines to the 4.5x area (Moody's adjusted) and free cash flow to debt improves to the mid-single digit percentage range (Moody's adjusted) coupled with constant currency revenue growth in the low-to-mid-single digit percentage band. A ratings upgrade is unlikely over the near-term, especially if the coronavirus outbreak continues to impact clients' spending on Nielsen's measurement and analytics products. Over time, an upgrade could occur if the company demonstrates constant currency revenue growth in the mid-single digit percentage range and higher EBITDA margins in the 30% to 35% area. Additionally, upward rating pressure could occur if total debt to EBITDA declines below 4x (Moody's adjusted) and free cash flow to debt (Moody's adjusted) improves to the 5% to 6% range. Ratings could be downgraded if EBITDA margins contracted or debt levels increased resulting in total debt to EBITDA above 5x (Moody's adjusted) on a sustained basis and free cash flow generation weakened to below 1% of adjusted debt due to deterioration in operating performance. A deterioration in liquidity could also result in ratings pressure. SUMMARY OF ITS RATING ACTIONS Assignments: Issuer: Nielsen Finance LLC $500 Million Senior Secured Term Loan B due 2025, Assigned Ba1 (LGD2) Issuer: Nielsen Holding and Finance B.V. $300 Million USD equivalent Senior Secured Euro Term Loan B due 2025, Assigned Ba1 (LGD2) Affirmations: Issuer: Nielsen Holdings plc Corporate Family Rating -- Ba3 Probability of Default Rating -- Ba3-PD Issuer: Nielsen Finance LLC (Co-Borrowers: TNC (US) Holdings Inc. and Nielsen Holding and Finance B.V.) $850 Million Senior Secured Revolving Credit Facility due 2023, Affirmed at Ba1 (LGD2) Issuer: Nielsen Finance LLC $1,125 Million ($1,083 Million outstanding) Senior Secured Term Loan A due 2023, Affirmed at Ba1 (LGD2) EUR545 Million ($592 Million USD equivalent) Senior Secured Euro Term Loan B-2 due 2023, Affirmed at Ba1 (LGD2) $2,303 Million ($2,262 Million outstanding) Senior Secured Term Loan B-4 due 2023, Affirmed at Ba1 (LGD2) Downgrades: Issuer: Nielsen Finance LLC (Co-Borrower: Nielsen Finance Co.) $800 Million 4.5% Senior Unsecured Notes due 2020, Downgraded to B2 (LGD5) from B1 (LGD5) $2,300 Million 5.0% Senior Unsecured Notes due 2022, Downgraded to B2 (LGD5) from B1 (LGD5) Issuer: The Nielsen Company (Luxembourg) S.a.r.l. $625 Million 5.5% Senior Unsecured Notes due 2021, Downgraded to B2 (LGD5) from B1 (LGD5) $500 Million 5.0% Senior Unsecured Notes due 2025, Downgraded to B2 (LGD5) from B1 (LGD5) Speculative Grade Liquidity Actions: Issuer: Nielsen Holdings plc Speculative Grade Liquidity, Remains SGL-2 Outlook Actions: Issuer: Nielsen Holdings plc Outlook, Remains Negative Issuer: Nielsen Finance LLC Outlook, Remains Negative Issuer: The Nielsen Company (Luxembourg) S.a.r.l. Outlook, Remains Negative Issuer: Nielsen Holding and Finance B.V. Outlook, Assigned Negative The assigned ratings are subject to review of final documentation and no material change in the size, terms and conditions of the transaction as advised to Moody's. Moody's will withdraw the B2 rating on the 4.5% senior notes upon their full redemption. Nielsen Holdings plc, founded in 1923 and headquartered in Oxford, England and New York, NY, is a global provider of consumer information and measurement that operates in more than 100 countries. Nielsen's Connect segment (47% of LTM 3/31/20 revenue) provides retail measurement and consumer panel measurement services as well as consumer intelligence and analytical services for clients. The Media segment (53% of LTM 3/31/20 revenue) provides viewership and listenership data and analytics across television, radio, online and mobile devices for the media and advertising industries. Revenue totaled approximately $6.5 billion for the twelve months ended March 31, 2020. NORTH AMERICAN LIFTING: $470MM Bank Debt Trades at 46% Discount --------------------------------------------------------------- Participations in a syndicated loan under which North American Lifting Holdings Inc is a borrower were trading in the secondary market around 54 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 75 cents-on-the-dollar for the week ended May 8, 2020. The $470.0 million facility is a Term loan. The facility is scheduled to mature on November 27, 2020. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. NORTH AMERICAN LIFTING: Bank Debt Trades at 83% Discount -------------------------------------------------------- Participations in a syndicated loan under which North American Lifting Holdings Inc is a borrower were trading in the secondary market around 18 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 33 cents-on-the-dollar for the week ended May 8, 2020. The $185.0 million facility is a Term loan. The facility is scheduled to mature on November 27, 2021. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. NORTHWEST FIBER: S&P Rates Senior Unsecured Note Issuance 'CCC' --------------------------------------------------------------- S&P Global Ratings assigned its 'CCC' issue-level rating and '6' recovery rating to Kirkland, Wash.-based telecommunications service provider Northwest Fiber LLC's (doing business as Ziply Fiber) proposed $250 million senior unsecured notes due 2028. The '6' recovery rating indicates its expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a payment default. The company will use the net proceeds from these notes to repay its $250 million bridge loan, which along with $890.5 million of secured debt, comprises the debt financing for its acquisition of the Pacific Northwest properties of Frontier Communications Corp. and recapitalization by WaveDivision Capital LLC (not rated) and Searchlight Capital Partners LLC (not rated). Because the transaction does not affect Ziply's credit metrics, S&P's 'B-' issuer-credit rating and stable outlook on the company are unchanged. ISSUE RATINGS—RECOVERY ANALYSIS Key analytical factors: -- S&P's simulated default scenario envisions a default triggered by an acceleration in voice-access lines losses, while broadband growth remains muted due to aggressive competition from significantly larger and better-capitalized cable operators such as Comcast. As a result, revenue declines and a high percentage of fixed costs compress margins. These factors could contribute to significantly lower profitability and cash flow levels for the company. This decline in operating results would lead to a payment default at the point when Ziply's liquidity and cash flow become insufficient to cover its cash interest expenses, mandatory debt amortization, and maintenance-level capex requirements. -- At default, S&P's recovery analysis assumes a capital structure consisting of a $100 million revolving credit facility maturing in 2025 (85% drawn), a $790.5 million term loan B due 2027, and $250 million of senior unsecured notes due 2028. -- Estimated debt claims include about six months of accrued but unpaid interest outstanding at the point of default. -- S&P assesses recovery prospects on the basis of a distressed gross recovery value of about $741 million. This is based on an emergence EBITDA of about $148 million and an EBITDA multiple of 5x. The $148 million emergence EBITDA is S&P's estimate of Ziply's hypothetical default-level EBITDA. Simulated default assumptions: -- Simulated year of default: 2022 -- EBITDA at emergence: $148 million -- Implied enterprise valuation multiple: 5x -- Gross enterprise value (EV): $741 million Simplified waterfall: -- Net EV (after 5% administrative costs): $704 million -- Valuation split (obligors/nonobligors): 100%/0% -- Estimated net EV available for first-lien debt: $704 million -- Estimated senior secured debt claims: $897 million -- Senior secured debt recovery rating: '2'; rounded estimate: 75% -- Senior secured debt issue-level rating: 'B' -- Estimated value available for senior unsecured debt: $0 -- Estimated senior unsecured debt claims: $264 million -- Senior unsecured debt recovery rating: '6'; rounded estimate: 0% -- Senior unsecured debt issue-level rating: 'CCC' Note: All debt amounts include six months of prepetition interest. NOVAN INC: Posts $6.17 Million Net Loss in First Quarter -------------------------------------------------------- Novan, Inc. reported a net loss and comprehensive loss of $6.17 million on $1.21 million of total revenue for the three months ended March 31, 2020, compared to a net loss and comprehensive loss of $6.64 million on $1.10 million of total revenue for the three months ended March 31, 2019. As of March 31, 2020, the Company had $36.51 million in total assets, $48.87 million in total liabilities, and a total stockholders' deficit of $12.36 million. The Company believes that its existing cash and cash equivalents balance, including (i) the net proceeds of approximately $15,263 related to the March 2020 offerings and related warrant exercises, and (ii) expected contractual payments to be received in connection with existing licensing agreements, will provide it with adequate liquidity to fund its operating needs into the second half of 2021, excluding costs associated with the execution of the Company's late-stage clinical development programs, which will require additional funding or strategic partnering in order to complete. Specifically, this operating forecast and related cash projection excludes the potential costs associated with an additional confirmatory Phase 3 trial for SB206 as a treatment for molluscum beyond the initial start-up phase, along with any other new clinical stage development programs. Further advancement of the additional confirmatory Phase 3 trial for molluscum beyond the trial start-up phase and into the enrollment initiation phase, or advancement of any other late-stage clinical development program across the Company's platform, is subject to additional funding or strategic partnering, and has been and may be further impacted by the COVID-19 pandemic. Novan stated, "If the Company is unable to secure the additional capital necessary to advance its late-stage clinical development programs, including funding necessary to complete an additional confirmatory Phase 3 trial for SB206, the Company expects that it would align its operations accordingly to support conduct of its early stage research and development programs, while also continuing to evaluate strategic alternatives. "The failure of the Company to obtain additional funding on acceptable terms could have a material adverse effect on the Company's business and cause the Company to alter or reduce its planned operating activities, including but not limited to delaying, reducing, terminating or eliminating planned product candidate development activities, to conserve its cash and cash equivalents. The Company needs and intends to secure additional capital from non-dilutive sources, including partnerships, collaborations, licensing, grants or other strategic relationships, or through equity or debt financings. Any issuance of equity or debt that could be convertible into equity would result in significant dilution to our existing stockholders. Alternatively, the Company may seek to engage in one or more potential transactions, such as the sale of the Company, or sale or divestiture of some of its assets, such as a sale of its dermatology platform assets, but there can be no assurance that the Company will be able to enter into such a transaction or transactions on a timely basis or at all on terms that are favorable to the Company. Under these circumstances, the Company may instead determine to dissolve and liquidate its assets or seek protection under the bankruptcy laws. If the Company decides to dissolve and liquidate its assets or to seek protection under the bankruptcy laws, it is unclear to what extent the Company will be able to pay its obligations, and, accordingly, it is further unclear whether and to what extent any resources will be available for distributions to stockholders." A full-text copy of the Quarterly Report is available for free at the Securities and Exchange Commission's website at: https://is.gd/Km2dIM About Novan Inc. Based in Morrisville, North Carolina, Novan Inc. -- http://www.novan.com/-- is a clinical development-stage biotechnology company focused on leveraging nitric oxide's naturally occurring anti-viral, anti-bacterial, anti-fungal and immunomodulatory mechanisms of action to treat a range of diseases with significant unmet needs. Nitric oxide plays a vital role in the natural immune system response against microbial pathogens and is a critical regulator of inflammation. Novan reported a net loss and comprehensive loss of $30.64 million for the year ended Dec. 31, 2019, compared to a net loss and comprehensive loss of $12.67 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $29.09 million in total assets, $52.9 million in total liabilities, and a total stockholders' deficit of $23.79 million. BDO USA, LLP, in Raleigh, North Carolina, the Company's auditor since 2018, issued a "going concern" qualification in its report dated Feb. 24, 2020, citing that the Company has suffered recurring losses from operations and has not generated significant revenue or positive cash flows from operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. NPC INTERNATIONAL: $160MM Bank Debt Trades at 98% Discount ----------------------------------------------------------- Participations in a syndicated loan under which NPC International Inc is a borrower were trading in the secondary market around 3 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 42 cents-on-the-dollar for the week ended May 8, 2020. The $160.0 million facility is a Term loan. The facility is scheduled to mature on April 18, 2025. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. NPC INTERNATIONAL: $605MM Bank Debt Trades at 57% Discount ---------------------------------------------------------- Participations in a syndicated loan under which NPC International Inc is a borrower were trading in the secondary market around 43 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 83 cents-on-the-dollar for the week ended May 8, 2020. The $605.0 million facility is a Term loan. The facility is scheduled to mature on April 20, 2024. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. ONEWEB GLOBAL: Seamless Air Not Affected by OneWeb Filing --------------------------------------------------------- Mary Kirby of Runaway Girl Network reports that Seamless Air Alliance said that the bankruptcy of Seamless founding member OneWeb changes nothing about the grouping's core mission or plans going forward. "No impact from OneWeb, as you know we are 30+ members strong at this point," said Jack Mandala, CEO of Seamless, which introduced its first inflight connectivity standard in February 2020 after striking a balance with IFC suppliers on the granularity of the technical requirements. OneWeb's plan to offer a global Low Earth Orbit satellite network, with low-latency connectivity service across verticals including aero, was expected to help realize the alliance's vision for supporting seamless connectivity for passengers. OneWeb in March 2020 filed for Chapter 11 bankruptcy protection in New York to execute a sales process. It blamed the COVID-19 pandemic as the reason it faced difficulty in obtaining funding. The news came after OneWeb failed to secure new funding from its biggest backer, Japan's SoftBank. While Mandala admitted to Runway Girl Network that Seamless has felt the impact of the COVID-19 crisis, he said the alliance remains fully operational. It recently launched six new Working Groups with the support of the Board, Chairs and volunteers "who all remain committed and engaged". "We have shifted to remote-first workshops using a fun new collaboration tool (called Mural) that keeps everyone actively participating. Our WG meetings are happening every week and progress reports are posted to our member portal so those that are not able to attend at this point have the opportunity to catch up," Mandala said. Mandala said it "would avoid major issues for airlines in times like these. Certainly, it will be a long road ahead but the need for connectivity isn't going away and we will be ready to support the industry when recovery is at hand." About Seamless Air Alliance Seamless Air Alliance, a consortium dedicated to the development and promotion of standards to facilitate a better, more seamless, inflight connectivity experience for passengers. Seamless was founded in 2018 by Airbus, Airtel, Delta Air Lines, OneWeb and Sprint. Its members now include a ‘who’s who’ of suppliers and service providers in the IFC industry as well as Aeromexico, Air France-KLM, GOL, Etihad Airways, and Virgin Atlantic. About OneWeb Global Founded in 2012, OneWeb Global Limited -- https://www.oneweb.world/ -- is a global communications company developing a low-Earth orbit satellite constellation system and associated ground infrastructure, including terrestrial gateways and end-user terminals, capable of delivering communication services for use by consumers. OneWeb's business consists of the development of the OneWeb System, which has included the development of small-next generation satellites that have been mass-produced through a joint venture and the development of specialized connections between the satellite system and the internet and other communications networks through the SNPs. OneWeb Global Limited and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-22437) on March 27, 2020. At the time of the filing, the Debtors disclosed assets of between $1 billion and $10 billion and liabilities of the same range. Judge Robert D. Drain oversees the cases. The Debtors tapped Milbank, LLP as legal counsel; Guggenheim Securities, LLC as investment banker; FTI Consulting, Inc., as financial advisor; Omni Agent Solutions as claims, noticing and solicitation agent; and Choate, Hall & Stewart LLP as special corporate counsel. ORIGIN AGRITECH: Reports RMB688,000 Net Loss for H1 FY 2020 ----------------------------------------------------------- Origin Agritech Limited reported net revenue of RMB44.1 million (US$6.3 million) during the first half year of FY2020, compared to RMB82.2 million for the first half year of FY2019. Total operating expenses for the first half year of FY2020 was RMB10.5 million (US$1.5 million), down 42% from RMB18.1 million for the same period a year ago. Selling and marketing expense for the first half year of FY2020 was RMB1.7 million (US$0.2 million), compared to RMB2.5 million a year ago. General and administrative expenses declined 49% to RMB4.3 million (US$0.6 million), down from RMB8.5 million a year ago. Research and development expenses for the first half year of FY2020 were RMB4.5 million (US$0.6 million), down from RMB7.1 million a year ago. Total operating income for the first half year of FY2020 was RMB2.6 million (US$0.4 million), compared to total operating income of RMB0.9 million reported a year ago. Interest expense was RMB2.3 million (US$0.3 million) during the first half year of FY2020. Other income of RMB3.2 million (US$0.5 million) was mainly rental income that the Company received from renting a portion of its headquarters building. Net loss attributable to the Company for the first half year of FY2020 was RMB0.7 million (US$0.1 million), compared to the net income of RMB1.2 million a year ago. Loss per share for the first half of FY2020 was RMB0.14 (or US$0.02), compared to the diluted earnings per share of RMB0.30 during the same period a year ago. As of March 31, 2020, cash and cash equivalents were RMB8.4 million (US$1.2 million), an increase of RMB5.2 million from the cash and cash equivalents of RMB3.2 million as of Sept. 30, 2019, The current portion of long-term debt is RMB78.6 million (US$11.1 million) as of March 31, 2020. Advances from customers were RMB40.1 million (US$5.7 million), compared to RMB52.2 million as of Sept. 30, 2019. As of March 31, 2020, total current assets were RMB86.8 million (US$12.3 million) and non-current assets was RB186.6million (US$26.4 million). As of March 31, 2020, total current liabilities were RMB252.4million (US$35.7 million). A full-text copy of the Form 6-K is available for free at the Securities and Exchange Commission's website at: https://is.gd/2Nykot About Origin Founded in 1997 and headquartered in Zhong-Guan-Cun (ZGC) Life Science Park in Beijing, Origin Agritech Limited (NASDAQ GS: SEED) -- http://www.originseed.com.cn/-- is an agricultural biotechnology company, specializing in crop seed breeding and genetic improvement, seed production, processing, distribution, and related technical services. Origin operates production centers, processing centers and breeding stations nationwide with sales centers located in key crop-planting regions. Product lines are vertically integrated for corn, rice and canola seeds. Origin Agritech reported a net loss of RMB65.65 million for the year ended Sept. 30, 2019, compared to a net loss of RMB152.79 million for the year ended Sept. 30, 2018. As of Sept. 30, 2019, the Company had RMB261.11 million in total assets, RMB276.58 million in total liabilities, and a total deficit of RMB15.47 million. B F Borgers CPA PC, in Lakewood, Colorado, the Company's auditor since 2020, issued a "going concern" qualification in its report dated March 2, 2020, citing that the Company incurred recurring losses from operations, has net current liabilities and an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. OSI RESTAURANT: S&P Lowers Issuer Credit Rating to 'BB-' -------------------------------------------------------- S&P Global Ratings corrected its issuer credit rating on OSI Restaurant Partners LLC. In a rating action taken on March 19, 2020 S&P lowered the ratings on OSI's parent organization Bloomin' Brands Inc. to 'BB-' from 'BB' and placed the ratings on CreditWatch with negative implications. Due to an error, S&P did not lower the ratings on OSI, a co-borrower on the company's rated credit facilities. S&P is correcting the rating by lowering the issuer credit rating on OSI by one notch to 'BB-' from 'BB' and maintaining the negative CreditWatch listing. PARADIGM TELECOM: Unsecureds Owed $23M Get 1% Initial Payout ------------------------------------------------------------ Paradigm Telecom 11, LLC submitted a Second Amended Disclosure Statement. Class 2 Allowed Unsecured Claims totaling $23,000,000 are impaired. Class 2 claimants will be paid pro rata an initial distribution of 1 percent of their allowed claim on the Effective Date. A Debtor-in-Possession Fund will be established for the distribution of subsequent dividends which are as yet not allowed by Order of the Court and to which objections remain. Thereafter, after payment of incurred and unpaid expense of administration claims post-petition, a quarterly distribution of 90% of the funds then on hand shall be distributed on a pro rata basis. Class 3 Equity Interests areimpaired and consists of the stock ownership of Paradigm Telecom II, LLC. The shareholders, Carl Merzi and Brian Beers, shall retain their shares in the Reorganized Debtor. The Debtor's business is able to pay a dividend to its creditors pursuant to this Plan, excluding extraordinary expenses associated with this Chapter 11 case, the Debtor has shown a small profit. A full-text copy of the Second Amended Disclosure Statement dated April 29, 2020, is available at https://tinyurl.com/ydyf9ewc from PacerMonitor.com at no charge. Counsel for the Debtor: Richard L. Fuqua FUQUA & ASSOCIATES, PC 8558 Katy Freeway, Suite 119 Houston, Texas 77024 Tel: (713) 960-0277 Fax: (713) 960-1064 About Paradigm Telecom II LLC Paradigm Telecom II, LLC -- http://www.paradigmtelecom.com/-- is a provider of communications infrastructure to carrier providers. Its services include ethernet, dark fiber, DAS and small cell, fiber to the tower, and international voice and data. It was founded in 2001 and is headquartered in Houston, Texas. Paradigm Telecom II sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 18-34112) on July 27, 2018. In the petition signed by Brian Beers, president, the Debtor was estimated to have assets of less than $500,000 and liabilities of $1 million to $10 million. Judge Jeff Bohm oversees the case. Richard L. Fuqua, II, Esq., at Fuqua & Associates, PC, serves as the Debtor's bankruptcy counsel. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors on Sept. 18, 2018. The committee tapped Walker & Patterson, P.C. as its legal counsel. PARK HOTELS: S&P Assigns 'B' Issuer Credit Rating; Outlook Neg. --------------------------------------------------------------- S&P Global Ratings assigned its 'B' issuer credit rating to Park Hotels & Resorts Inc. In addition, S&P assigned its 'BB-' issue-level rating and '1' recovery rating to Park's proposed senior secured notes, reflecting very high recovery expectations for lenders in a hypothetical default scenario. "The 'B' rating reflects our forecast for very high leverage in 2020, as well as significant operating uncertainty that could result in leverage of 7.5x-8.5x in 2021 even under a recovery scenario. Based on our expectation for very low revenue per available room (RevPAR) in the second quarter and that a gradual recovery could begin in the third, we assume U.S. industry RevPAR will decline in the 40%-50% range in 2020. Since the pandemic began, the luxury and upper upscale segments have underperformed the industry. In addition, key gateway markets and resort destinations that account for a meaningful portion of Park's revenue have been harshly impacted, partly because they rely on air travel and business demand. Given Park's exposure to upscale segments and affected markets, its RevPAR could decline near or modestly more than the high end of our industry range in 2020," S&P said. The anticipated decline in RevPAR and revenue puts significant pressure on hotel-level profitability. Hotel owners such as Park probably will not be able to reduce costs enough to generate much, if any, profitability in 2020. In such a scenario, leverage would likely rise to very high levels in 2020. Liquidity would fall as the company burns cash due to hotel operating losses, reduced corporate overhead costs, reduced maintenance capital expenditures (capex), and debt service over at least the next few months. "We assume the coronavirus outbreak in the U.S. can be contained by midyear 2020, so that travel and hotel demand will begin to recover beginning in the second half of 2020 and through 2021. The likely path of recovery is that leisure travel would recover first, business transient second, and group business third. Group travel may recover over several years, partly driven by potential lingering concerns about gatherings and social-distancing norms. Given the material decline in occupancy in 2020, as long as the economy recovers according to our forecast and travel resumes in the second half of 2020 and in 2021, we estimate 2021 U.S. RevPAR could increase 50%-60% but remain about 20% below 2019 RevPAR. Park's RevPAR could rebound more than the high end of the industry range in 2021 partly because of a relatively easy comparison to the prior year, enabling margin expansion (compared to 2020) and potentially improving adjusted debt to EBITDA to 7.5x-8.5x," S&P said. Key risk factors include Park's significant exposure to gateway and resort destination markets such as Hawaii, San Francisco, and Orlando, Fla. They also include high revenue exposure to business transient and group travel. Approximately 25% of 2019 property-level EBITDA was generated by assets in Hawaii, a fly-to destination that may recover more slowly than drive-to markets as leisure consumers and business transient travelers gradually build confidence they can travel safely. Park's revenue exposure to business transient and group travel was approximately 60% in 2019. Uncertainty regarding the shape and duration of recovery contributes to S&P's negative outlook on the rating, although the rating agency estimates Park will have ample liquidity over the next two years. Incorporating the proposed notes issuance, S&P estimates Park will have ample liquidity for at least 22 months. Park's liquidity sources total about $1.7 billion, including balance sheet cash, the proposed notes issuance, and revolver availability. In the remainder of 2020, Park may generate some revenue to the extent it can collaborate with government authorities to provide lodging for essential workers and presumably as travel demand sequentially recovers each month. However, S&P assumes operating cash flow and EBITDA will be negative over the next three quarters. Park suspended operations at hotels representing approximately 85% of its room base, which puts significant pressure on hotel-level profitability and contributes to material anticipated operating losses after considering corporate, general, and administrative costs. Over the next 2-3 quarters, S&P expects cash balances to be the key source of liquidity. Liquidity uses include hotel-level operating expenses and working capital needs, corporate-level overhead costs, interest expense and debt amortization, and capex. It is our understanding that Park's current average monthly cash burn is $75 million-$80 million if operations at all 60 portfolio hotels are suspended. S&P's base case does not assume all Park hotels are suspended indefinitely and that a recovery would start in the third quarter of 2020, therefore it estimates that Park's pro forma liquidity of $1.7 billion would provide more than 22 months of runway. "Our rating incorporates the asset quality and size of Park's hotel portfolio. Park has a high quality, geographically diverse portfolio of hotels in key gateway cities and resort markets. The company's focus on high quality assets in desirable city-center and resort locations enables it to command premium pricing, which is reflected in a relatively high average daily rate in stable economic conditions. Park has long-term management contracts with successful luxury and upper upscale hotel brands, including those owned by Hilton, Marriott, and Hyatt. This supports premium pricing and high occupancy levels. We believe there are some barriers to entry in key markets such as Hawaii, San Francisco, Orlando, and New York, where the company's properties are centrally located or the room base is unique or difficult to replicate," S&P said. Park owns one of the largest portfolios among lodging REITs and has 34 unencumbered hotels as defined by its credit agreements. The unencumbered asset base provides Park the flexibility to monetize individual hotels to reduce debt if needed, even if the timing may be disadvantageous in a recession scenario. "We assume no asset sales in our base-case forecast through 2021, partly because the market for lodging properties could be unfavorable for some time, and the timing and transaction size of noncore asset sales are not easily quantifiable. To the extent Park uses proceeds from asset sales for debt repayment, we likely would view it as credit-positive as long as Park sells assets for a higher multiple than its leverage," S&P said. These positive attributes are partly offset by some geographical concentration in Park's portfolio. The cyclical nature of the lodging industry and high revenue and earnings volatility associated with hotel ownership are also key risk factors. Park's concentration in luxury and upper upscale segments could result in more volatile EBITDA over a cycle than those for owners focused in the economy or midscale segments. This is because pricing tends to compress during an economic downturn, with the luxury segment falling the most and the economy segment the least. As a result, Park is more exposed to EBITDA variability over the cycle than hotel owners in lower-price, select-service segments and lodging managers and franchisers that do not have an owner's fixed cost burden. "We believe Park's financial policy commitment will result in lower leverage over time. The company has a publicly stated target to maintain leverage of 3x-5x. We believe Park has demonstrated a track record of maintaining its financial policy, including after the acquisition of Chesapeake Lodging Trust when Park's measure of 2019 pro forma adjusted debt to EBITDA was 4.3x. Although we anticipate leverage to be high in 2020 and 2021, we believe Park would be motivated to reduce leverage to its target levels over next several years," S&P said. Environmental, social, and governance (ESG) credit factors relevant to this rating change: -- Health and safety The outlook is negative and reflects the anticipated stress on revenue and cash flow as well as uncertainty about the path of recovery over the two next years as Park copes with significantly reduced hotel demand. S&P views Park's ample liquidity and good interest coverage as key risk mitigants over the next two years, despite very high leverage. S&P also views the ability to monetize noncore assets as a potential source of financial flexibility and risk mitigation, although the rating agency assumes no asset sales in our forecast through 2021. "We could lower the rating on Park if the assumed RevPAR recovery is weaker or takes longer than we anticipate, resulting in adjusted debt to EBITDA sustained above 8.5x and EBITDA coverage of interest expense approaching 1.5x. We could also lower the rating if the company's liquidity position deteriorates significantly," S&P said. "We could revise the outlook to stable if the assumed RevPAR, revenue, and EBITDA recovery through 2021 aligns with our forecast. We could also revise the outlook to stable if proceeds from noncore asset sales are used for debt repayment. To indicate rating upside, we need to be confident that Park could sustain adjusted debt to EBITDA under 7x and interest coverage above 2.5x," the rating agency said. PREMIER ON 5TH: Disclosure Statement Conditionally Approved ----------------------------------------------------------- Judge Caryl E. Delano has ordered that the Disclosure Statement filed by Premier on 5th, LLC, is conditionally approved. Any written objections to the Disclosure Statement shall be filed and served no later than seven days prior to the date of the confirmation hearing. The Court will conduct a hearing on confirmation of the Plan, including timely filed objections to confirmation, objections to the Disclosure Statement, motions for cram-down, applications for compensation, and motions for allowance of administrative claims on June 10, 2020 at 2:00 p.m. in Tampa, FL - Courtroom 9A, Sam M. Gibbons United States Courthouse, 801 N. Florida Avenue. Objections to confirmation shall be filed and served no later than seven days before the date of the Confirmation Hearing. The Debtor will file a ballot tabulation no later than 96 hours prior to the time set for the Confirmation Hearing. About Premier on 5th Premier on 5th, LLC, owns in fee simple a real property in Sarasota, Fla. Premier on 5th sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-12098) on Dec. 27, 2019. At the time of the filing, the Debtor disclosed $1,195,000 in assets and $494,132 in liabilities. Timothy W. Gensmer, P.A., is the Debtor's legal counsel. RENFRO CORP: S&P Cuts ICR to 'CCC-' on Heightened Refinancing Risk ------------------------------------------------------------------ S&P Global Ratings lowered its ratings, including its issuer credit rating, on U.S.-based sock manufacturer Renfro Corp. to 'CCC-' from 'CCC'. The downgrade reflects Renfro likely being out of compliance with the terms of its credit agreements by May 31 unless it receives a waiver, and a restructuring over the near term appears inevitable. Renfro's unrated asset-based lending (ABL) revolving credit facility matures in February 2021 and its $220 million term loan ($145 million currently outstanding) matures shortly afterward on March 31, 2021. Given Renfro's operating underperformance over the past several years (EBITDA is more than 40% less than it was five years ago), its double-digit leverage, negative free cash flow generation, tight covenant cushion, and the uncertainty created by the COVID-19 pandemic, S&P believes it will be challenging for the company to refinance its debt before it matures. In its audit report for fiscal year ended January 2020, it expressed substantial doubt about its ability to continue as a going concern because of the upcoming debt maturities, and its auditors issued a qualified opinion. Renfro's credit agreements require it to provide annual audited financial statements without a "going concern" qualification. It received an amendment that waived these restrictions through May 31, 2020, at which time lenders can exercise remedies, including accelerating the maturity of the loans, unless the company receives another waiver. Although it may receive another temporary waiver, S&P believes it is very likely Renfro will default on its obligations in the next six months, given the challenges the company is facing and its looming debt maturities. The negative outlook reflects the heightened risk the company could default on its debt obligations or engage in a restructuring transaction over the next six months. "We could lower the rating if the company announces a debt restructuring or misses a principal or interest payment," S&P said. "We could raise the rating if we no longer believe there is a high probability of a near-term default, distressed exchange, or other form of debt restructuring. This would require a refinancing of both its ABL revolver and term loan on satisfactory terms," the rating agency said. RIVORE METALS: Court Confirms Liquidating Plan ---------------------------------------------- Judge Thomas J. Tucker has ordered that the Second Amended Combined Plan of Liquidation and Disclosure Statement filed by Rivore Metals, LLC, is confirmed. The Disclosure Statement is granted final approval. The Liquidating Trustee must carry a bond in an amount no less than $10,000. The Liquidating Trustee must file quarterly reports regarding the status of distributions and liquidation of assets. Such reports must commence for the first 90 days after the Effective Date and continue until the assets are fully administered. In the event of unclaimed distributions or returned checks that are not claimed within 60 days of their return, the funds must be paid to the estate, and then used to pay creditors otherwise entitled to a distribution under the Plan. About Rivore Metals Rivore Metals, LLC -- http://www.rivore.com/-- is a metals trading and project management company with offices in the United States and Canada offering full service trading operations to international specialized markets for ferrous and non-ferrous scrap metals. Rivore Metals filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No. 19-53795) on Sept. 27, 2019. In the petition signed by Konstantinos C. Marselis, president, the Debtor was estimated to have up to $50,000 in assets and $1 million to $10 million in liabilities. The case is assigned to Judge Thomas J. Tucker. Charles D. Bullock, Esq. at Stevenson & Bullock, P.L.C., is the Debtor's counsel. The U.S. Trustee for Region 9 appointed a committee of unsecured creditors on on Oct. 15, 2019. ROYAL ALICE: AMAG Says Liquidation Analysis Insufficient -------------------------------------------------------- AMAG, Inc., filed an objection to the Royal Alice Properties, LLC's Amended Disclosure Statement for Chapter 11 Plan. AMAG points out that the Liquidation Analysis provided is insufficient and fails to provide adequate information. AMAG further points out that the Projections provided for the purpose of determination of feasibility or other items is difficult to read and appears to be based on assumptions that are not consistent with the facts of the operation of the Debtor since its filing on August 29, 2019. AMAG asserts that as an example of the problem encountered with the projections, it appears that the Debtor is counting full payment of all leases. However, the monthly reports clearly show that the Debtor has not received full payment from the insider lessees during the pendency of this matter. AMAG complains that the language of the exculpation clause is vague and, in the least, requires redrafting for clarity. Further, it appears that one or more insider may be receiving the benefit of a release, which is both prohibited and will cause the Plan to be non-confirmable. According to AMAG, the Debtor does not discuss in any way why a separate and stand-alone financing should occur, rather than a one closing financing all contained in the Plan. AMAG points out that the Debtor does not detail or explain where the monies received as property of the estate are spent. Several of the monthly reports show expenses out of the ordinary course of business without Court approval and with no detail. AMAG further points out that in the present case, the Amended Disclosure Statement in many instances provides no information, while at other times provides information that is misleading and incomplete. AMAG realizes that not all factors are applicable, however, the Amended Disclosure Statement does not contain sufficient information to comply with the standard mandated by 11 U.S.C. Sec. 1125. AMAG complains that the Disclosure Statement fails to provide feasibility and all the items required to determine that the Reorganized Debtor is capable of making payments as specified post confirmation. AMAG further complains that the Disclosure Statement attaches an expired Bridge Financing Term Sheet. AMAG asserts that the Disclosure Statement fails to specify the details of retained claims pursuant to 11 U.S.C. Sec. 1123(b)(3)(B). According to AMAG, the Disclosure Statement fails to address the result of the Judicial Admissions by the Debtor that the Chapter 11 estate is solvent, including the running of interest and other charges to all creditors. AMAG points out that the Disclosure Statement fails to address subordination of the claims by the insiders and/or affiliates regarding payment as referenced in the Plan. AMAG further points out that the Disclosure Statement fails to specify the need for and the purpose of the interest reserve in the amount of $318,750. AMAG complains that the Disclosure Statement fails to show and the Debtor has failed to file a pleading relating to the post-petition financing. No information exists on the ability of the Debtor to obtain post-petition financing. According to AMAG, the liquidation analysis provided is insufficient. AMAG asserts that the Debtor fails to identify the party/entity which Debtor asserts has made a firm offer to acquire Unit C 912 Royal for $2,500,000. Further, the Debtor does not state why AMAG as the first mortgage holder should not be paid in full of the amount received from a sale. Attorney for AMAG Inc.: Richard W. Martinez, APLC 3500 N. Hullen St. Metairie, LA 70002 Telephone: (504)525-3343 Email: richard@rwmaplc.com About Royal Alice Properties Royal Alice Properties, LLC, owns, manages and rents the building and real estate located on the 900 block of Royal Street in the French Quarter, New Orleans, Louisiana. The condominium units are located at 906, 910-12 Royal St. New Orleans, LA 70116. Royal Alice Properties sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. La. Case No. 19-12337) on Aug. 29, 2019. In the petition signed by Susan Hoffman, member/manager, the Debtor was estimated $1 million to $10 million in both assets and liabilities. The case is assigned to Judge Elizabeth W. Magner. Leo D. Congeni, Esq., at Congeni Law Firm, LLC, represents the Debtor. ROYAL ALICE: Arrowhead Capital Questions Rental Income ------------------------------------------------------ Claimant Arrowhead Capital Finance, Ltd., which filed and holds a Proof of Claim and has asserted an adversary proceeding (No. 20-1022) for more than $1.9 million against debtor Royal Alice Properties, LLC, filed an objection to the Disclosure Statement explaining the Debtor's Chapter 11 Plan. Arrowhead objects to the purported liquidation analysis, on which Debtor's Amended Chapter 1 1 Plan and Disclosure Statement are based, as that analysis is predicated on false assertions as to rental income belied by the actual facts. Arrowhead further objects to and opposes Debtor's Disclosure Statement and Amended Chapter 11 Plan which are improperly based on (a) a "sham" 20-year lease to Debtor affiliate PicturePro LLC of a valuable 5,000 square foot three-floor apartment under which Debtor actually receives no rent; (b) a 20-year below-market lease to Debtor affiliate Royal Street Bistro, LLC ("RSB") which currently is not conducting any business and has no apparent ability to pay rent for its valuable ground-floor premises; (c) sale of another of the properties to Debtor's RSB affiliate for less than the appraised value submitted by Debtor; and (d) other improper "insider" dealings; Arrowhead points out that the Debtor's bankruptcy petition is not and never was "feasible". Arrowhead further reminds the Court that both the U.S. Trustee and Arrowhead have filed pending motions seeking appointment of a qualified, disinterested trustee in light of (among other things) the history of adjudicated felonies, fraud, and other misconduct of Debtor's principals (Peter and Susan Hoffman); their failure to deal properly with and account for receipts and disbursements of, and to timely file proper financial statements for, the Debtor; and their conflicts of interest concerning Debtor's properties. Attorneys for Arrowhead Capital Finance: BARRY L. GOLDIN, ESQ. 3744 Barrington Drive Allentown, PA 18104-1759 Telephone: (610) 336-6680 Fax: (610) 336-6678 E-mail: barrygoldin@earthlink.net - and - Daniel J. Carr PEIFFER WOLF CARR & KANE 1519 Robert C. Blakes sr. Drive, Floor New Orleans, Louisiana 70130 Tel: (504) 586-5270 Fax: (504) 523-2464 E-mail: dcarr@pwcklegal.com About Royal Alice Properties Royal Alice Properties, LLC, owns, manages and rents the building and real estate located on the 900 block of Royal Street in the French Quarter, New Orleans, Louisiana. The condominium units are located at 906, 910-12 Royal St. New Orleans, LA 70116. Royal Alice Properties sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. La. Case No. 19-12337) on Aug. 29, 2019. In the petition signed by Susan Hoffman, member/manager, the Debtor was estimated $1 million to $10 million in both assets and liabilities. The case is assigned to Judge Elizabeth W. Magner. Leo D. Congeni, Esq., at Congeni Law Firm, LLC, represents the Debtor. ROYAL ALICE: U.S. Trustee Wants Details of Plan Financing --------------------------------------------------------- Dave W. Asbach, Acting United States Trustee for Region 5, objects to the adequacy of the Disclosure Statement for the Amended Chapter 11 Plan filed by Royal Alice Properties, LLC. The U.S. Trustee points out that the Disclosure Statement failed to provide any details regarding the terms of the "bridge financing" required to partially fund the Plan. The U.S. Trustee further points out that the Disclosure Statement failed to provide any details regarding the "real estate financing" required to partially fund the Plan, particularly considering the disclosure that the "Debtor cannot arrange conventional financing [...] based on the criminal convictions and the damage to Mr. Hoffman's business and income resulting therefrom". The U.S. Trustee complains that the Disclosure Statement and Plan's unsupported reliance on $100,000 in rent proceeds/cash reserves, given the lack of rent collected while in bankruptcy. The U.S. Trustee asserts that the Debtor’s failure to reserve causes of action against any insider companies and tenants, despite their non-payment of rent since the filing of the bankruptcy petition. According to the U.S. Trustee, the Disclosure Statement failed to provide a pro forma analysis of income and payments under the Plan and a liquidation analysis, as required by Local Rule 3016-1. The U.S. Trustee further points out that the Disclosure Statement contains overbroad exculpation language. About Royal Alice Properties Royal Alice Properties, LLC, owns, manages and rents the building and real estate located on the 900 block of Royal Street in the French Quarter, New Orleans, Louisiana. The condominium units are located at 906, 910-12 Royal St. New Orleans, LA 70116. Royal Alice Properties sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D. La. Case No. 19-12337) on Aug. 29, 2019. In the petition signed by Susan Hoffman, member/manager, the Debtor was estimated $1 million to $10 million in both assets and liabilities. The case is assigned to Judge Elizabeth W. Magner. Leo D. Congeni, Esq., at Congeni Law Firm, LLC, represents the Debtor. RR DONNELLEY: Moody's Rates New $300MM Unsec. Notes Due 2027 'B3' ----------------------------------------------------------------- Moody's Investors Service assigned a B3 rating to R.R. Donnelley & Sons Company's proposed $300 million senior unsecured exchange notes due in 2027. Moody's also assigned a B3 rating to the company's $297 million senior unsecured exchange notes due in 2029 that was issued in April 2020. The company's B2 corporate family rating (CFR), B2-PD probability of default rating, B1 senior secured term loan B rating, B3 senior unsecured notes and debentures ratings, SGL-3 speculative grade liquidity rating, and negative outlook remain unchanged. Net proceeds from the proposed exchange offering of up to $300 million will be used to exchange for portions of the company's unsecured notes and debentures due in 2021 through 2024. The proposed notes will rank pari passu with the existing unsecured notes and debentures. Ratings Assigned: $300M Senior Unsecured Notes due 2027, B3 (LGD5) $297M Senior Unsecured Notes due 2029, B3 (LGD5) RATINGS RATIONALE RRD's B2 CFR is constrained by: (1) expectations that financial results will be pressured in the next 12 months due to effects of the coronavirus outbreak; (2) high business risk from ongoing pressures on profitability as replacement revenues from other services (packaging, labels, direct marketing, digital print, statements etc.) have not expanded sufficiently to compensate for the decline in commercial print; (3) execution risks as it transforms itself from a commercial printer focused on manuals, publications, brochures, business cards etc. to higher margin businesses; and (4) leverage (adjusted Debt/EBITDA) that is expected to be sustained above 5x in the next 12 to 18 months (5.7x for LTM Q1/2020), a level that is high given ongoing secular pressures. The rating benefits from: (1) good market position, diversity and scale; (2) prudent financial policy, focused on continued debt repayment (3) flexible cost structure, which allows for continued cost reduction; (4) adequate liquidity and lack of refinancing risk until 2022. 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 shock in many sectors, regions, and markets. The combined credit effects of these developments are unprecedented. Moody's expects credit quality to deteriorate, especially for those companies in the vulnerable sectors that are most affected by sharply reduced revenue and profitability, and disrupted supply chains. Moody's will take rating actions as warranted to reflect the breadth and severity of the shock, and the broad deterioration in credit quality that it has triggered. RRD has adequate liquidity (SGL-3). Sources approximate $645 million while uses in the form of mandatory debt repayment in the next 4 quarters total about $247 million. Liquidity is supported by $451 million of cash at March 31, 2020 and about $193 million of availability under its $800 million revolving facility that matures in September 2022. Free cash flow is expected to be about breakeven in the next 12 months. Mandatory debt repayments in the next 12 months include about $6 million of term loan amortization and about $241 million of senior unsecured notes. RRD is subject to a fixed interest charge coverage covenant and cushion is expected to exceed 30% through the next four quarters. The company has limited ability to generate liquidity from asset sales. The negative outlook reflects the company's exposure to revenue and EBITDA pressures due to the coronavirus outbreak and excess capacity in the commercial printing industry, and as advertising dollars shift to digital and social media platforms, together with challenges of reducing costs in line with revenue declines in the next 12 to 18 months. FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The rating could be upgraded if the company generates sustainable positive organic growth in revenue and EBITDA and sustains leverage below 4x (5.7x for LTM Q1/2020). The rating could be downgraded if business fundamentals deteriorate due to digital substitution as well as the impact of the coronavirus outbreak, evidenced by accelerating revenue and EBITDA declines or if leverage is sustained above 5x (5.7x for LTM Q1/2020). Weak liquidity, possibly due to negative free cash flow generation on a consistent basis could also cause a downgrade. RRD's environmental risk is low. The company has exposure to hazardous substances and it could face material costs related to remediation of contaminated manufacturing facilities should that occur. RRD's social risk is elevated. Social issues are linked to the impact of the coronavirus outbreak as well as data security and digital substitution. RRD has to adapt its business model in response to the pressures in the printing industry and this will lead to a continuing focus on cost reduction. RRD's governance risk is moderate. Its financial policy has been prudent, characterized by management's attention to debt repayment rather than shareholder-friendly actions. RRD does not make share repurchases and has temporarily suspended its dividend payments. Headquartered in Chicago, Illinois, RRD is the leader in the North American commercial printing industry. Revenue for the twelve months ended March 31, 2020 was $6.2 billion. The principal methodology used in these ratings was Media Industry published in June 2017. SCOOBEEZ INC: Unsecured Creditors to Recover $529K in Plan ---------------------------------------------------------- Scoobeez, et al. filed a First Amended Disclosure Statement. The Debtors hired an investment banking firm and marketed their assets for a sale or recapitalization. The Debtors had multiple potential bidders interested in acquiring their business. However, in October 2019, right before the planned exit of the Debtors' business from chapter 11 bankruptcy through a sale was to come to fruition, the Debtors’ largest customer, Amazon Logistics, Inc., objected to the assumption and assignment of its contract with the Debtors and instead told the Debtors that Amazon was going to terminate its contract with the Debtors and cease doing business with the Debtors. The Debtors and Amazon are currently in litigation, wherein the Debtors and Hillair allege that Amazon violated the automatic stay and should be enjoined. The Debtors, the Committee (on behalf of General Unsecured Creditors) and Hillair negotiated the terms of the Plan. The Plan provides a $1.5 million carve-out for the Debtors' estates, and a trust (the "Creditor Trust") with litigation claims and potential excess from the carve-out, after payment of professional fees, in which Class 4 General Unsecured Creditors share if they vote in favor of the Plan. The Plan also reorganizes the Debtors as of the Effective Date, with Hillair receiving 80% of the equity in the Reorganized Debtors, and Class 4 General Unsecured Creditors receiving 20% of the equity in the Reorganized Debtors (through the Creditor Trust), if they vote in favor of the Plan. The Plan also provides for Hillair to receive the first $5,000,000 of proceeds of the Amazon Litigation, with the Creditor Trust to receive 25%, and Hillair to receive 75%, of remaining recoveries from the Amazon Litigation thereafter. Moreover, upon the Effective Date, Hillair's secured claim will be reduced from $11.1 million to $3 million. It is estimated that the Plan would enable greater distributions than would be available in a chapter 7 liquidation, and that holders of Allowed General Unsecured Claims will receive a recovery of approximately $529,000 if the Plan is confirmed, depending on the final amount of Allowed General Unsecured Claims. If the Plan is not confirmed, it is estimated that the holders of Allowed General Unsecured Claims would receive $0 in recovery under a Chapter 7 liquidation. A full-text copy of the First Amended Disclosure Statement dated April 29, 2020, is available at https://tinyurl.com/ycsa4lky from PacerMonitor.com at no charge. Attorneys for the Debtors: Ashley M. McDow John A. Simon Shane J. Moses FOLEY & LARDNER LLP 555 S. Flower St., 33rd Floor Los Angeles, CA 90071 Telephone: 213.972.4500 E-mail: amcdow@foley.com jsimon@foley.com smoses@foley.com About Scoobeez Inc. Scoobeez Inc. -- https://www.scoobeez.com/ -- operates an on demand door-to-door logistics and real time delivery service company. It offers messaging, same day and preferred deliveries, and courier services. Scoobeez and its affiliates, Scoobeez Global Inc. and Scoobur LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Lead Case No. 19-14989) on April 30, 2019. Judge Julia W. Brand oversees the cases. At the time of the filing, Scoobeez had estimated assets and liabilities of between $10 million and $50 million while Scoobur had estimated assets and liabilities of less than $50,000. Meanwhile, Scoobeez Global disclosed $6,274,654 in assets and $7,886,579 in liabilities. Foley & Lardner LLP is the Debtors' bankruptcy counsel. Conway Mackenzie, Inc., is the Debtors' financial advisor. The Office of the U.S. Trustee appointed a committee of unsecured creditors on May 20, 2019. The committee retained Levene, Neale, Bender, Yoo & Brill LLP as its counsel. SCRANTON-LACKAWANNA HEALTH: S&P Cuts 2016A-C Bond Rating to 'CCC+' ------------------------------------------------------------------ S&P Global Ratings lowered its long-term rating on the Scranton-Lackawanna Health and Welfare Authority (Scranton Parking System Concession Project), Pa.'s series 2016A senior parking revenue current interest bonds, series 2016B senior parking revenue current interest bonds, and series 2016C senior parking capital appreciation bonds outstanding to 'CCC+' from 'BB-', and placed the rating on CreditWatch with negative implications. "The downgrade and CreditWatch action reflect our opinion that the parking system is vulnerable to non-payment of debt service requirements due to the severe and ongoing impacts associated with the COVID-19 pandemic, which we expect will further exacerbate low parking utilization rates and materially weaken parking system revenues," said S&P Global Ratings credit analyst Scott Shad. "Our opinion is based on our expectation that debt service coverage, per our calculations, will be insufficient in fiscal 2020 based on net operating revenues of the parking system and lack of available liquidity that, together, will likely require material draws from a $1.4 million cash-funded debt service reserve fund (DSRF) to meet debt service requirements totaling about $1.7 million in fiscal 2020." Excluding the DSRF, management reported available liquidity of about $1 million as of May 8, which S&P expects will be materially drawn down for near-term debt service requirements and operational cash flow needs. Furthermore, the rating agency expects the parking system will remain vulnerable to non-payment of debt service requirements in fiscal 2021 as a result of escalating debt service requirements, depleted DSRF balances, and depressed parking utilization rates. In accordance with S&P's criteria, the 'CCC+' rating reflects the rating agency's view that the parking system is vulnerable to non-payment of debt service requirements, but it does not expect a payment crisis in the near term (within 12 months) due to the availability of DSRF balances and other available liquidity. The parking system is exposed to social risks related to COVID-19 shelter-in-place requirements, which S&P views as direct negative impacts as health and safety social risks under the rating agency's environmental, social, and governance (ESG) factors, resulting in significant financial pressures. Furthermore, S&P believes social risks present ongoing operational challenges and negatively constrain the parking system's rate-setting flexibility and financial performance due to its location in an economically weak service area, given affordability issues and significant competition, resulting in low parking utilization rates. The rating agency believes environmental and governance risk are in line with the sector. S&P expects to resolve the CreditWatch within the next 90 days, during which time the rating agency expects to receive more information on changes to business, financial, and economic conditions for the parking system, which may result in a further downgrade of one or multiple notches. SMARTER TODDLER: Court Approves Disclosure Statement ---------------------------------------------------- Judge Shelley C. Chapman has ordered that the Disclosure Statement filed by Smarter Toddler Group, LLC, is approved on a final basis, and the Plan is confirmed. The Sale as provided for in the Plan is hereby approved and authorized in all respects, and the agreements contemplated thereby, and consummation of the Sale is hereby approved and the Debtor and Purchaser are authorized to comply with the APA and the ancillary agreements contemplated thereby. As the Plan expressly contemplates the sale of the Purchased Assets, after the Effective Date, in order to effectuate the Plan, the post-Effective Date Sale thereof to the Purchaser shall not be taxed under any law imposing a stamp or similar tax as provided for in Section 1146(a) of the Code, including (i) the initial transfer of the Purchased Assets; (ii) the creation of any mortgage, deed of trust, lien, pledge or other security interest required in connection with such initial transfer; or (iii) the making or delivery of any deed or other instrument or transfer from the Debtor to the Purchaser under, in furtherance of, or in connection with the Plan. The Sale of the Purchased Assets shall be free and clear of any and all Claims, liens, encumbrances, equities and Interests of any nature or kind except as expressly assumed by the Purchaser under the APA (collectively, “Liens”), with all such Liens, including Liens of the Class 2 Claimholders, to attach to proceeds of the Sale, in the same priority as the prepetition lien or mortgage securing the Class 2 Claim, and to be paid from the Plan Distribution Fund to the extent provided for under the Plan, as applicable, and shall constitute a sale under Sections 105, 363(b), (f) and (m), 1123(a)(5) and (b)(4) and 1129 of the Bankruptcy Code. Pursuant to Section 365 of the Bankruptcy Code, notwithstanding any provision of any Leases or Assigned Contracts or applicable non-bankruptcy law that prohibits, restricts, or conditions the assignment of the Leases or the Assigned Contracts, the Debtor is authorized to assume and to assign Leases and the Assigned Contracts to the Purchaser, which assignment shall take place on and be effective as of the Closing, or as otherwise provided by order of this Court. The Debtor has met all requirements of Section 365(b) of the Bankruptcy Code for the assumption and assignment of each of the Leases and the Assigned Contracts. The Debtor’s assumption of the Leases and the Assigned Contracts is subject to the consummation of the terms of the APA. Notwithstanding anything to the contrary herein, the Debtors’ assumption and assignment of the 99 John Lease is subject to the satisfaction of the conditions set forth in the Stipulation and Order Pursuant to Sections 365(B), (D)(3) and (D)(4) Governing Assumption And Assignment And Extending Time To Assume Or Reject Unexpired Lease Of Nonresidential Real Property dated April 20, 2020 [Docket No. 90]. Upon the Closing, (a) the Debtor is hereby authorized and directed to consummate, and shall be deemed for all purposes to have consummated, the sale, transfer and assignment of all of the Debtor’s right, title and interest in the Purchased Assets to the Purchaser free and clear of any and all Claims and Interests pursuant to Sections 363, 365 and 1123(a)(5), (b)(2) and (b)(4) of the Bankruptcy Code, other than the Assumed Liabilities, with such Claims and Interests to attach to the sale proceeds in the same validity, extent and priority as existed with respect to the Purchased Assets immediately prior to the Closing, subject to any rights, claims and defenses of the Debtor and other parties in interest, and (b) except for the Assumed Liabilities, all such Claims and Interests shall be and hereby are released, terminated and discharged as to the Purchaser and the Purchased Assets. The Debtor is authorized to pay in cash within one business day of the Closing all cure costs associated with the Leases and the Assigned Contracts. The transfer of the Debtor’s right, title and interest in the Purchased Assets to the Purchaser pursuant to the APA shall be, and hereby is deemed to be, a legal, valid, enforceable, and effective transfer of all of the Debtor’s right, title and interest in the Purchased Assets, and vests with or will vest in the Purchaser all right, title and interest of the Debtor in the Purchased Assets, free and clear of all Claims and Interests of any kind or nature whatsoever (other than the Assumed Liabilities), with all such Claims and Interests attaching to the sale proceeds in the same validity, extent and priority as existed with respect to the Purchased Assets immediately prior to the Closing, subject to any rights, claims and defenses of the Debtor and other parties in interest. The Sale has been undertaken by the Purchaser in good faith and the Purchaser is a good faith purchaser of the Purchased Assets as that term is used in Section 363(m) of the Bankruptcy Code, and, accordingly, the reversal or modification on appeal of the authorization provided herein to consummate the Sale shall not affect the validity of the Sale. The Purchaser is entitled to all of the protections afforded by Section 363(m) of the Bankruptcy Code. Section 2.2. of the Plan is hereby amended and superseded to provide as follows: “The Allowed DIP Loan Claim shall be paid in full, in Cash, together with reasonable attorney’s fees and interest at the rate provided in the underlying loan agreement, on the later of (a) the Effective Date or (b) the Sale Closing Date”. A full-text copy of the Order dated April 29, 2020, is available at https://tinyurl.com/ybke3vwh from PacerMonitor.com at no charge. About Smarter Toddler Group Smarter Toddler Group, LLC -- https://www.smartertoddler.net/ -- is a child care - pre school in New York. It offers early childhood education, top tier private preschools, pre-k, child day care centers, nursery, infant childcare, baby activities, toddler enrichment classes, art, music, movement classes, science, yoga, dance, languages, sign language, literacy, kindergarten prep, GNT gifted and talented test prep tutoring, G&T preparation. Smarter Toddler Group sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 19-13097) on Sept. 27, 2019, in Manhattan, New York. In the petition signed by Kettia Ming, manager, the Debtor was estimated to have assets between $1 million and $10 million, and liabilities of the same range. Judge Shelley C. Chapman is assigned the case. Storch Amini PC is the Debtor's legal counsel. SNC-LAVALIN GROUP: S&P Affirms 'BB+' Issuer Credit Rating --------------------------------------------------------- S&P Global Ratings affirmed its ratings on SNC-Lavalin Group Inc. (SNC), including its 'BB+' issuer credit rating on the company; however, the outlook on the company remains negative. A weaker economic environment should result in lower earnings and cash flow over the next couple of years than S&P previously anticipated. SNC's performance in the past three quarters was trending about in line with S&P's previous expectations and the probability of a downgrade was receding. However, the emergence of the COVID-19 pandemic meaningfully disrupted construction activity in the regions in which SNC operates. As a result, higher costs and weaker demand for services this year are expected to result in weaker earnings and cash flow generation than S&P had previously anticipated. S&P now expects 2020 adjusted EBITDA to be about 25% lower than its estimates in its last research update on SNC, published in August 2019. S&P's forecast credit metrics this year include adjusted debt-to-EBITDA in the mid-3x area with negative free operating cash flow (FOCF) generation, which remains weak for the rating and supports the rating agency's negative outlook on the company. S&P's estimated credit measures and cash flow expectations in 2020 are about consistent with the rating agency's previous downside scenario. In addition, there is a high degree of uncertainty regarding the impact that the pandemic could have on SNC's business. Moreover, while the risk appears to be abating, the company remains exposed to additional losses on its lump-sum turnkey projects. "In our view, the potential for earnings and cash flow below our expectations this year could lead to credit measures we do not view as commensurate with the ratings. Furthermore, weaker-than-expected market conditions and operating results could lead to a materially higher free cash flow deficit. We believe this could limit SNC's ability to generate adjusted debt-to-EBITDA below 3x next year, which we require to stabilize the outlook on the rating," S&P said. "The affirmation of our 'BB+' issuer credit rating on SNC reflects our view that the company's performance over the past three quarters was trending in line with what we previously expected and that demand should recover next year, contributing to positive FOCF generation and leverage falling to the mid-2x area in 2021," the rating agency said. Furthermore, S&P believes SNC's financial policies will continue to support leverage below 3x in the long term. The rating agency believes this deleveraging will stem from relatively stable earnings within SNCL Engineering Services, which it expects will contribute at least C$600 million of annual EBITDA (excluding capital investments and corporate costs) beyond 2020. S&P's base-case scenario also assumes that there will be no significant cost overruns on the remaining lump-sum turnkey (LSTK) contracts and that losses at SNCL Projects will be contained below C$150 million over the next 12 months. The negative outlook primarily reflects uncertainty in the company's ability to recover earnings and cash flow so that adjusted debt-to-EBITDA returns below 3x by next year. S&P bases this on risks related to potential cost overruns on remaining LSTK projects in SNC's backlog if poorly executed. It also incorporates the risk of weaker demand for engineering services amid disruptions stemming from the coronavirus pandemic. "We could lower the ratings on SNC within the next 12 months if we expect adjusted debt-to-EBITDA to remain above 3x in 2021. This could occur from cost overruns on remaining LSTK projects, or if the effects of the pandemic on the company's financial results this year are meaningfully worse than we expect. We could also lower the ratings if we expect SNC's longer-term growth prospects or profitability within engineering services will be weaker than those of its peers, potentially contributing to our view that SNC's competitive position has deteriorated," S&P said. "We could revise our outlook on SNC to stable within the next 12 months if the company's operating performance is generally in line with our expectations, potentially leading us to believe that execution risk on SNC's LSTK project backlog has abated and that the other areas of the business should continue to support our assessment of SNC's competitive position. In this scenario, we would have more conviction that adjusted debt-to-EBITDA will be below 3x beyond 2020 with positive FOCF generation," the rating agency said. SOUTHERN GRAPHICS: Bank Debt Trades at 90% Discount --------------------------------------------------- Participations in a syndicated loan under which Southern Graphics Inc is a borrower were trading in the secondary market around 10 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 25 cents-on-the-dollar for the week ended May 8, 2020. The $105.0 million facility is a Term loan. The facility is scheduled to mature on December 8, 2023. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. STEPS IN HOME CARE: Files for Chapter 11 to Fend Off Lawsuits ------------------------------------------------------------- Bill Heltzel, writing for Westfair Business Publications, reports that White Plains-based home health care company Steps in Home Care Inc. sought CHapter 11 protection in anticipation of federal labor law violations lawsuits. The "immediate need for relief from this court," CEO Jennifer Baukol stated in a declaration, "stems from a threatened class action lawsuit under the Fair Labor Standards Act that will severely affect the cash flow of the company and lead to its inability to address ongoing obligations." As stated in its corporate website, the company hires only experienced caregivers and pays "industry-leading rates" and offers better benefits “to set ourselves apart from our competitors." Steps in Home Care employs 83 people but it notified over 1,100 individuals of the bankruptcy case, according to the petition. It doesn’t explain the reason why it will be sued under the Fair Labor Standards Act, that regulates overtime pay and the minimum wage. In 2017, Teresa Fuentes Diaz of the Bronx sued Steps in Home Care under the labor law. She worked as home health aide from middle of 2015 to late 2017, with salary beginning at $9.90 an hour and ending at $10.76. She claimed that she typically worked 144 hours a week including several 24-hour shifts but was paid for 78 hours. The company denied the allegations. The dispute was settled by agreeing to pay Diaz $6,638 in 2018. According to Baukol's bankruptcy declaration, the company expects revenue of $400,000 in May 2020 and $350,000 in expenses. As stated in its federal tax return included with the petition, in 2018, it booked revenue worth $5.2 million and income worth $93,299. Its biggest expense was over $3 million in salaries and wages. The compensation for officers was listed at $0 in 2018 and $540,000 in 2017. About Steps in Home Care Steps in Home Care Inc. is a home health care provider located at 3 Barker Avenue, 2nd Floor, White Plains, New York 10601. It was founded in 2011 and it has offices in Garden City, New York and Stamford, Connecticut. The company was owned by Jennifer Baukol and sister Lisa Wade. It offers home companions, skilled nursing, basic assistance and concierge services, like driving patients to their appointments and managing their insurance claims. On May 1, 2020, Steps in Home Care sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 20-22615) on May 1, 2020. The Debtor was estimated to to have less than $50,000 in assets and liabilities. MORRISON TENENBAUM, PLLC, is the Debtor's counsel. STIPHOUT FINANCE: Bank Debt Trades at 39% Discount -------------------------------------------------- Participations in a syndicated loan under which Stiphout Finance LLC is a borrower were trading in the secondary market around 61 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 82 cents-on-the-dollar for the week ended May 8, 2020. The USD36.0 million facility is a Term loan. The facility is scheduled to mature on October 26, 2023. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. SUNGARD AS: Bank Debt Trades at 62% Discount -------------------------------------------- Participations in a syndicated loan under which Sungard AS New Holdings III LLC is a borrower were trading in the secondary market around 38 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 85 cents-on-the-dollar for the week ended May 8, 2020. The $300.0 million facility is a Pik Term loan. The facility is scheduled to mature on November 3, 2022. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. SUNPOWER CORP: Stockholders Re-Elect Three Directors ---------------------------------------------------- SunPower Corporation held its 2020 annual meeting of stockholders on May 14, 2020. The stockholders re-elected Thomas McDaniel, Thomas Rebeyrol, and Thomas Werner as Class III directors to serve until the Company's 2023 annual meeting of stockholders or until their duly qualified successors are elected. In a non-binding advisory vote, the stockholders approved the compensation of the Company's named executive officers as disclosed in the Company's proxy statement. The stockholders also ratified the appointment of Ernst & Young LLP as the Company's independent registered public accounting firm for fiscal year 2020. About SunPower Headquartered in San Jose, California, SunPower Corporation -- http://www.sunpower.com/-- is a global energy company that delivers complete solar solutions to residential, commercial, and power plant customers worldwide through an array of hardware, software, and financing options and through solar power solutions, operations and maintenance services, and "Smart Energy" solutions. The Company's Smart Energy initiative is designed to add layers of intelligent control to homes, buildings and grids -- all personalized through easy-to-use customer interfaces. SunPower reported a net loss of $7.72 million for the fiscal year ended Dec. 29, 2019, compared to a net loss of $917.5 million for the fiscal year ended Dec. 30, 2018. As of March 29, 2020, the Company had $1.99 billion in total assets, $1.98 billion in total liabilities, and $20.06 million in total stockholders' equity. TMX FINANCE: S&P Alters Outlook to Stable, Affirms 'B-' ICR ----------------------------------------------------------- S&P Global Ratings Services said it affirmed its 'B-' issuer credit rating on TMX Finance LLC. At the same time, S&P revised the outlook to stable from positive. S&P also affirmed its 'B-' issue rating on the company's 11.125% senior secured notes due 2023. The recovery rating on the notes remains unchanged at '4', indicating its expectation of an average (40%) recovery in the event of default. "The outlook revision reflects our view that it's unlikely we will raise our ratings due to uncertainty related to the COVID-19 pandemic coupled with upcoming 2020 U.S. presidential election. We expect the pandemic to lead to reduced originations, increased provision for credit loss, and higher charge-offs. The stable outlook reflects the company's steady financial performance, our expectation of leverage of 4.0x-5.0x, EBITDA interest coverage of 2.0x-2.5x, and no imminent refinancing risk," S&P said. For the 12 months ended March 31, 2020, leverage, measured as, gross debt to adjusted EBITDA, was 3.1x and EBITDA coverage was 3.0x compared with 3.4x and 2.9x, respectively at year-end 2019. TMX leverage benefits from S&P's operating lease adjustments by about 0.4x because the rating agency adds back $152 million of operating lease liabilities and $60 million of leasing expenses. TMX generated $200 million of EBITDA in 2019 versus $160 million in 2018--a 25% increase. In light of the continuing pandemic, S&P expects 2020 adjusted EBITDA to drop by about 25%-30% to $140 million-$150 million. TMX operates in the highly regulated consumer finance industry. It's regulated by the Consumer Financial Protection Bureau (CFPB) at the federal level and states at the local level. Despite the regulatory tailwinds from CFPB considering the elimination of the ability to pay requirement and rollover restrictions, S&P expect state regulators to step in and fill the void. In March 2020, Virginia passed two identical bills, Senate bill 421 and House bill 789. These placed a 36% annual percentage rate and impose certain restrictions on licensed consumer products. The bill applies to loans originated on or after Jan. 1, 2021. As of March 2020, TMX has 79 stores and generated about 4% of combined receivables from Virginia. In light of California Assembly Bill (AB) 539, TMX closed 64 stores between April and May of 2020 that made up about 3.7% of combined loan receivables (4% of EBITDA) as of March 2020. As of 2019, the majority of TMX's gross receivables are concentrated in Georgia (22%), Texas (14%), and Alabama (9%). If the CFPB were to limit high-cost title loans, S&P believes TMX's operating profitability would be especially hurt in Georgia. The stable outlook over the next 12 months reflects S&P's expectations of debt to adjusted EBITDA of 4.0x-5.0x, EBITDA coverage of 2.0x-2.5x, and net charge-offs (as a percent of average receivables) staying below 40%. The outlook also considers no imminent refinancing risk and adequate covenant cushion. "We could lower the ratings if operational performance severely deteriorates, so that EBITDA coverage approaches 1.0x; if the firm considers buying back debt well below par; if any regulations impedes the firm's growth strategy; or if TMX' covenant cushion declines," S&P said. "An upgrade is not likely until after the COVID-19 pandemic and its resulting economic downturn subsides. We could raise the ratings, if we expect leverage to sustain below 4.0x, EBITDA coverage remain above 2.5x, and net charge-offs as a percentage of average receivables remain below 35% on a sustained basis." An upgrade would also be contingent upon no regulations impeding firm's operational performance," the rating agency said. TRANSPLACE HOLDINGS: Bank Debt Trades at 29% Discount ----------------------------------------------------- Participations in a syndicated loan under which Transplace Holdings Inc is a borrower were trading in the secondary market around 71 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 84 cents-on-the-dollar for the week ended May 8, 2020. The $110.0 million facility is a Term loan. The facility is scheduled to mature on October 9, 2025. As of May 15, 2020, $100.0 million of the loan remains outstanding. The Company's country of domicile is United States. TRIBE BUYER: Bank Debt Trades at 47% Discount --------------------------------------------- Participations in a syndicated loan under which Tribe Buyer LLC is a borrower were trading in the secondary market around 53 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 63 cents-on-the-dollar for the week ended May 8, 2020. The $397.0 million facility is a Term loan. The facility is scheduled to mature on February 16, 2024. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. ULTRA PETROLEUM: Davis Polk, Rapp Represent Noteholder Group ------------------------------------------------------------ In the Chapter 11 cases of Ultra Petroleum Corp., et al., the law firms of Davis Polk & Wardwell LLP and Rapp & Krock, PC submitted a verified statement under Rule 2019 of the Federal Rules of Bankruptcy Procedure, to disclose that they are representing the Ad Hoc Noteholder Group formed by holders of 9.00% cash / 2.00% PIK senior secured second lien notes due 2024. In or around December 2019, the Ad Hoc Noteholder Group engaged Davis Polk to represent it in connection with the Members' holdings of Second Lien Notes. In May 2020, the Ad Hoc Noteholder Group engaged Rapp & Krock to act as co-counsel in these Chapter 11 Cases. As of May 12, 2020, members of the Ad Hoc Noteholder Group and their disclosable economic interests are: AVENUE CAPITAL MANAGEMENT II, L.P. 11 West 42nd Street, 9th Floor New York, NY 10036 * $107,942,394 in aggregate principal amount of Second Lien Notes * 12,400,323 common shares of Ultra Petroleum Corp. GOLDMAN SACHS & CO. LLC 200 West Street, 15th Floor New York, NY 10282 * $49,453,084.00 in aggregate principal amount of Second Lien Notes SPECIAL SITUATIONS INVESTING GROUP, INC. 200 West Street, 15th Floor New York, NY 10282 * $18,407,614.35 in aggregate principal amount of First Lien Term Loan Claims Upon information and belief formed after due inquiry, Counsel does not currently hold any claim against, or interest in, the Debtors or their estates. Davis Polk's address is 450 Lexington Avenue, New York, New York 10017. Rapp & Krock's address is 1980 Post Oak Boulevard, Suite 1200, Houston, TX 77056. Counsel submits this Statement out of an abundance of caution, and nothing herein should be construed as an admission that the requirements of Bankruptcy Rule 2019 apply to Counsel's representation of the Ad Hoc Noteholder Group. Counsel to the Ad Hoc Noteholder Group can be reached at: RAPP & KROCK, PC Henry Flores, Esq. Kenneth Krock, Esq. 1980 Post Oak Blvd, Suite 1200 Houston, TX 77056 Telephone: (713) 759-9977 Facsimile: (713) 759-9967 Email: hflores@rappandkrock.com kkrock@rappandkrock.com - and - DAVIS POLK & WARDWELL LLP Damian S. Schaible, Esq. Stephen D. Piraino, Esq. 450 Lexington Avenue New York, NY 10017 Telephone: (212) 450-4000 Facsimile: (212) 701-5800 E-mail: damian.schaible@davispolk.com stephen.piraino@davispolk.com A copy of the Rule 2019 filing, downloaded from PacerMonitor.com, is available at https://is.gd/71xERB About Ultra Petroleum Ultra Petroleum Corp., an independent oil and gas company, engages in the acquisition, exploration, development, operation, and production of oil and natural gas properties. Its principal business activities are developing its natural gas reserves in the Green River Basin of southwest Wyoming, the Pinedale and Jonah fields. The company was founded in 1979 and is headquartered in Englewood, Colorado. Ultra Petroleum Corp. and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-32631) on May 14, 2020. The Debtor disclosed total assets of $1,450,000,000 and total debt of $2,560,000,000 as of March 31, 2020. The Hon. Marvin Isgur is the case judge. The Debtors tapped KIRKLAND & ELLIS LLP as general bankruptcy counsel; JACKSON WALKER LLP as local bankruptcy counsel; CENTERVIEW PARTNERS LLC as investment banker; and FTI CONSULTING, INC. as financial advisor. Prime Clerk LLC is the claims agent. UNIVERSAL HEALTH: Fitch Affirms 'BB+' LT IDR, Outlook Stable ------------------------------------------------------------ Fitch Ratings has affirmed Universal Health Services, Inc.'s (UHS) ratings, including the Long-Term Issuer Default Rating (IDR) at 'BB+' and senior secured debt ratings at 'BBB-'/'RR1'. The Rating Outlook is Stable. KEY RATING DRIVERS Coronavirus Hits Volumes; Impact Short-lived: Fitch believes that U.S. healthcare and pharmaceutical companies, including providers of healthcare services, should be less affected long-term by coronavirus and its influence on U.S. consumers' behavior than other corporate sectors because demand is less economically sensitive and often times is not discretionary. However, Fitch notes that while the impact for healthcare service providers, including UHS, is expected to be relatively muted compared to more discretionary sectors, depressed volumes of elective patient procedures have begun to meaningfully weigh on revenue and cash flow beginning in Q220. Healthcare providers cancelled elective procedures in both inpatient and outpatient settings in order to increase capacity for COVID-19 patients and in response to government orders. Fitch currently believes UHS has sufficient headroom in the 'BB+' rating to absorb these impacts, which is predicated on an assumption that the healthcare services sector will experience a strong recovery in elective patient volumes beginning in late 2020 and into 2021. However, there could be downward pressure on the rating if the outbreak is of longer duration and impacts cash flow in 2020 more than currently anticipated (perhaps due to patient preference to continue to defer care) or the healthcare services segment proves to be more economically sensitive than during past U.S. economic recessions, leading to a slower recovery in elective patient volumes and pricing in 2021-2022. Sustainably Low Debt Leverage: Fitch expects UHS will operate with gross debt/EBITDA after net distributions to associates and minorities around 3x in 2020 as a result of the volume declines, the upper end of the range considered consistent with the 'BB+' IDR. This is before consideration of grants received under the CARES Act. Amounts received to-date, should they be kept and accounted for as revenues, would increase EBITDA by $239 million and reduce leverage to the mid-2x range. This compares to leverage of 2.1x at Dec. 31, 2019, the lowest among Fitch-rated hospital companies, driven by management's relatively more conservative balance sheet management and M&A strategy. Management acknowledged on the 2Q19 earnings call that the leverage profile is low and "probably relatively inefficient", but provides the company a large amount of flexibility to return capital to shareholders or opportunistically make acquisitions. Fitch believes that as a result of that flexibility, EBITDA declines as a result of volume reductions during the coronavirus pandemic are not expected to cause UHS to meaningfully and persistently exceed its negative sensitivities. Fitch also believes that given the uncertainty of the current environment and the company's pause on its dividend and share repurchase activity, the company would be unlikely to act aggressively with respect to leveraging transactions or capital allocation in the intermediate term. Diversification, Stability from Behavioral Health: UHS operates acute care hospitals and a behavioral health segment, which provides revenue diversification as well as improved financial stability and profitability. Good organic growth, including in admissions and revenues, in the mid-single digits and stable profit margins are expected over the ratings horizon as the behavioral segment continues to benefit from improving parity between payers' coverage of care relative to the general acute segment. Recent acquisitions are in line with Fitch's expectation that opportunities to expand the behavioral health segment will be a primary focus of capital deployment. Post-Pandemic Margin Headwinds: Fitch expects that healthcare providers, including UHS, will adapt operations to manage the business disruption effects of coronavirus on operations through initiatives like telehealth. This will help minimize the effects of localized outbreaks of the virus on patient volumes before a vaccine or highly effective treatments are available. The longer-term effect of the economic disruption caused by the pandemic on healthcare consumers is less certain. The sector has historically been fairly resilient, but not immune, to the effects of economic recessions. Healthcare providers typically experience lower operating margins during and immediately following recessions due to treating greater numbers of uninsured patients and patients with relatively less profitable government sponsored health insurance. Fitch assumes UHS will continue to perform well in terms of volumes and commercial pricing, due in large part to its strong market shares in favorable urban markets where volumes tend to be weighted toward a higher-acuity patient mix. However, UHS's markets may exhibit more economic cyclicality over time due to the services-oriented employment markets in Las Vegas and Southern California. This solid operating profile will help the company defend profitability in the face of weak organic operating trends, but probably not enough to entirely overcome the effects of coronavirus-related unemployment on patient mix. Fitch expects operating margins for healthcare providers to rebound sharply in 2021 following a 2020 trough that reflects the peak pandemic business disruption, but to remain below the 2019 level for several years. Flexibility from Solid Cash Flows: Fitch expects FCF will sustain generally within $500 million to $700 million per year. These levels compare with $712 million and $588 million for the years ended 2019 and 2018, respectively. DERIVATION SUMMARY UHS's 'BB+' IDR reflects the company's strong financial profile resulting from low leverage, ample liquidity and strong operating margins. The company's operating profile is strong with operations focused in urban and large suburban markets, which have better organic growth prospects than rural and suburban markets. UHS's markets may exhibit more economic cyclicality than others. UHS is also diversified in its revenue stream, with approximately half of net revenues coming from its inpatient behavioral health segment. UHS's operating position and low leverage are the primary factors that distinguish its ratings from lower rated peers such as Tenet Healthcare Corp. (B/Stable) and Community Health Systems (CCC). UHS is rated a notch above HCA, Inc., which Fitch views as having a strong competitive position and market leading access to capital offset by higher leverage. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- Revenue declines by 5.8% in 2020 due to pandemic related business disruption, with a steady recovery in patient volumes beginning in the second half of the year and into 2021; -- EBITDA margin contracts 450 bps in 2020 due to negative operating leverage on patient volumes declines and rebounds strongly in 2021 but remains below the 2019 Fitch-calculated level of 16.5% through 2022 because of recessionary impacts on healthcare consumers in the post-pandemic period; -- Fitch's revenue and EBITDA forecast for UHS do not include CARES Act or other fiscal stimulus grant funding; -- There is no notable impact to the company's cash conversion cycle; -- Capex is reduced to 5.5% of revenues in 2020 commensurate with guidance, increasing as a percent of revenue over the ratings forecast. The company halts share repurchases and dividends in 2020-2021, resuming in 2022; -- FCF remains around $500 million to $700 million. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: An upgrade of UHS's IDR to 'BBB-' is unlikely in the near to intermediate term, as Fitch views the risks around reimbursement and other regulatory factors associated with healthcare providers in the U.S. — and UHS's reliance on government payers — as a material and uncontrollable risk for UHS and its peers; UHS's ratings and credit metrics provide it with flexibility to participate in healthcare provider consolidation, which Fitch expects to continue through the intermediate term. Positive momentum would also likely require a more specific financial policy. Factors that could, individually or collectively, lead to negative rating action/downgrade: A downgrade of UHS's IDR to 'BB' could result from pressured margins and cash flows, or a large, leveraging transaction that results in total debt to operating EBITDA after net distributions to minorities and associates expected to be sustained above 3.0x or CFO after capex-to-gross debt below 7.5%. The negative rating sensitives could be tripped if the coronavirus pandemic has a greater impact on cash flow than Fitch currently anticipates. There is still a high degree of uncertainty about the pace of acceleration of coronavirus cases along with the ultimate level of coronavirus patient volumes in UHS's markets and these factors will be important to the trajectory of 2020 revenue and EBITDA. LIQUIDITY AND DEBT STRUCTURE Good Financial Flexibility: UHS's liquidity profile is solid for the 'BB+' IDR. There are no significant debt maturities until 2021, when the $450 million A/R securitization ($260 million outstanding at March 31, 2020) terminates, with the nearest bond maturity being $700 million of 4.75% notes due 2022. Fitch's forecast assumes that UHS will refinance this debt. UHS does not have large cash needs for working capital or exhibit much seasonality in cash flow generation. Cash on hand is typically low, around $50 million to $100 million; the company has $998 million in revolving credit capacity and in recent periods has maintained close to full availability on this credit line. UHS also has good flexibility under the debt agreement covenants. The bank agreement includes a financial maintenance covenant that limits consolidated net leverage to 3.75x or below, increasing to 4.25x for four quarters following an acquisition. At March 31, 2020, Fitch estimates that UHS has incremental secured debt capacity of roughly $3.1 billion under the 3.75x consolidated leverage ratio test. Debt Issue Notching: Fitch does not employ a waterfall recovery analysis for issuers rated 'BB+'. The further up the speculative-grade continuum a rating moves, the more compressed the notching between the specific classes of issuances becomes. As such, Fitch rates the senior secured credit facility and senior secured bonds 'BBB-'/'RR1', one notch above the IDR. This rating illustrates Fitch's expectation for superior recovery prospects in the event of default. Furthermore, Fitch believes UHS has good financial flexibility at the 'BB+' IDR, illustrated by relatively low secured debt leverage, supporting the one notch uplift. 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. UHS has an ESG Relevance Score of 4 for Exposure to Social Impacts due to pressure to contain healthcare spending growth; highly sensitive political environment, and social pressure to contain costs or restrict pricing which has a negative impact on the credit profile, and is relevant to the rating in conjunction with other factors. UHS has an ESG Relevance Score of 4 for Governance Structure due to the significant control the Miller family has via its ownership and the relative voting rights of different share classes. US STEEL: Fitch Affirms 'B-' LongTerm IDR, Outlook Negative ----------------------------------------------------------- Fitch Ratings has affirmed Unites States Steel Corporation's Long-Term Issuer Default Rating (IDR) at 'B-'. The Rating Outlook remains Negative. Fitch has also affirmed the asset-backed loan (ABL) credit facility at 'BB-'/'RR1' and downgraded the senior unsecured notes to 'CCC'/'RR6' from 'B-'/'RR4'. Additionally, Fitch has assigned the new first lien secured notes a 'BB-'/'RR1' rating. The downgrade of the unsecured notes is due to the issuance of up to roughly $700 million of secured debt which receives priority in the recovery waterfall. The ratings reflect Fitch's expectation that key steel end markets, particularly automotive and energy will be materially weaker in 2020 in addition to the uncertainty associated with the coronavirus global pandemic's longer-term impact on the economy. In response to the coronavirus pandemic, U. S. Steel announced a number of strategic decisions including the decision to idle a number of facilities, draw an additional $800 million under its ABL credit facility and to defer capex. Additionally, the company is looking to issue up to $700 million of secured notes to further supplement its liquidity position. Although Fitch views the decisions as prudent to preserve liquidity, the significant reduction in earnings, increase in debt and uncertain timing of an economic recovery results in expectations that total debt/EBITDA will be highly elevated in the near term to medium term. The Negative Outlook reflects the uncertain ultimate economic impact of the coronavirus pandemic, the uncertain timing and magnitude of a recovery in the economy leading to the possibility that total debt/EBITDA will be sustained above 7.5x. Fitch views U. S. Steel's elevated financial leverage as partially offset by its significant liquidity position. KEY RATING DRIVERS Operational Footprint Decisions: In December 2019, U. S. Steel announced its intention to indefinitely idle a significant portion of its iron and steelmaking facilities at Great Lakes Works. In response to coronavirus developments, U. S. Steel recently announced it will idle the #4 blast furnace at Gary Works immediately and expects the furnace to remain idled until market conditions improve. U. S. Steel also announced it will temporarily idle the blast furnace "A" at Granite City Works. Fitch believes shipments could be more than 30% lower in 2020 due to operational footprint decisions in combination with the erosion of demand due to the coronavirus. Oil Price Collapse: Declining demand in addition to Saudi Arabia's intention to increase production led to a sharp significant drop in oil prices and rig count in 1Q20. In response to weak tubular demand, U. S. Steel intends to idle all or most of its Lone Star Tubular operations and Lorain Tubular operations beginning in late-May for an indefinite period of time. Operational tubular capacity is expected be primarily represented by Fairfield tubular operations, which has annual capacity of approximately 750,000 tons and will benefit from completion of the Fairfield EAF. However, Fitch expects tubular operations will be loss making over the next few years and believes it may be a significant amount of time before Lone Star and Lorain operations are restarted barring an oil price recovery. Auto and Energy Exposure: Approximately 30% of North American shipments in 2019 were to automotive, transportation and energy markets. Additionally, roughly 20% of USSE shipments were to automotive and transportation markets. Fitch believes these markets represent some of the most negatively impacted markets by the coronavirus. Fitch expects weaker market conditions to lead to significantly lower EBITDA in 2020. The timing and magnitude of a recovery in demand is currently highly uncertain leading to the possibility EBITDA may be depressed beyond 2020. Elevated Leverage: As of Dec. 31, 2019, U. S. Steel had outstanding borrowings of $600 million under its credit facility drawn to fund its acquisition of a 49.9% stake in Big River Steel. As a precautionary measure due in response to the coronavirus developments, U. S. Steel increased its borrowings under its credit facility by $800 million in 1Q20 in order to increase its cash position and preserve financial flexibility. Total debt/EBITDA was 7.4x as of Dec. 31, 2019, driven by increased borrowings and significantly weaker profitability. Fitch expects leverage to increase significantly in 2020 driven primarily by the recent decision to raise up to an additional $700 million of debt, the coronavirus impact on the economy and decisions taken to idle capacity. Fitch expects leverage to improve thereafter with a rebound in the economy although the timing and magnitude of a recovery currently remains uncertain. Fitch views the company's decision to raise additional debt resulting in further elevated leverage as partially offset by improved liquidity in the currently uncertain economic environment. Project Spending Deferral: Weak market conditions in Europe led to the announcement in 4Q19 to delay Dynamo line spending. U. S. Steel also plans to delay construction of its endless casting and rolling line and cogeneration facility at its Mon Valley Works. Fitch views the decision to prioritize cash and liquidity as prudent in the currently volatile market environment. However, postponed projects were focused on improving the company's cost position and therefore previously expected benefits from these investments are now also delayed in what may be a challenging steel price environment. Iron Ore Asset Monetization: U. S. Steel granted Stelco Inc. a $100 million option to acquire a 25% interest in its Minntac iron ore mining operations for an aggregate purchase price of $600 million. Under the agreement, Stelco paid $20 million to U. S. Steel immediately, and the remaining $80 million will be paid ratably over the remaining 2020 calendar year. Stelco will then have the ability to exercise its option any time before Jan. 31, 2027 to acquire a 25% interest for an additional $500 million. The transaction provides the potential to further improve liquidity and fits the company's reduced footprint following its indefinite idling of Great Lakes Works. Negative FCF Expectations: Fitch expects domestic and European steel markets to be significantly weaker in 2020 compared with 2019 driven by demand erosion in key steel end markets due to the coronavirus. Despite decisions to delay capital spending on strategic projects, Fitch expects cash burn of approximately $600 million annually on average through the ratings horizon. Fitch views U. S. Steel's significant liquidity position, minimal required pension contributions and no maturities over the next few years as partially offsetting expectations for negative FCF. DERIVATION SUMMARY U. S. Steel is larger in terms of annual shipments compared with EAF steel producer Commercial Metals Company (BB+/Stable) and smaller and less diversified than majority EAF producer Gerdau S.A. (BBB-/Stable) and global diversified steel producer ArcelorMittal S.A. (BB+/Negative). U. S. Steel has higher product and end-market diversification compared with CMC, although CMC has favorable leverage metrics and its profitability is less volatile resulting in more stable margins and leverage metrics through the cycle. U. S. Steel is larger in terms of total shipments, although is less profitable and has weaker credit metrics compared with EAF producer Steel Dynamics (BBB/Stable). U. S. Steel is also smaller and has weaker credit metrics compared with domestic EAF producer Nucor. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- Flat-rolled steel prices decline significantly and bottom in 2020 before improving with a rebound in the economy; -- Great Lakes Works remains idle through the ratings horizon, Granite City Works furnace "A" remains idle until 2022 and one USSK furnace remains idle through the forecast period; -- Flat-rolled shipments decline significantly to roughly seven million tons in 2020, improve to slightly less than nine million tons in 2021 and improve to roughly 10.5 million tons per year thereafter; -- USSK Dynamo line project spending is delayed beyond the ratings horizon and only modest spending on the endless casting and rolling investment at Mon Valley Works. The recovery analysis assumes U. S. Steel would be reorganized as a going concern in a bankruptcy rather than liquidated. Assumptions for the going concern (GC) approach: Fitch has assumed a bankruptcy scenario exit GC EBITDA of $650 million. The GC EBITDA estimate is reflective of a mid-cycle sustainable EBITDA level upon which Fitch bases the enterprise valuation. The $650 million GC EBITDA estimate compares with 2018 operating EBITDA of approximately $1.5 billion and 2016 operating EBITDA of approximately $400 million, which represent domestic steel market high and low points respectively. The GC EBITDA estimate is weighted toward the lower end of the mid-point to reflect the volatility of prices and the cyclical end market demand in addition to Fitch's view that the company could potentially exit a hypothetical bankruptcy scenario with a smaller operational footprint. Fitch generally applies EBITDA multiples that range from 4.0x-6.0x for metals and mining issuers given the cyclical nature of commodity prices. Fitch applied a 5.0x multiple to the GC EBITDA estimate to calculate a post-reorganization enterprise value of $2.925 billion after an assumed 10% administrative claim. Fitch assumed the ABL credit facility is 80% drawn in the recovery analysis. The allocation of value in the liability waterfall results in a Recovery Rating of 'RR1' for the first lien secured ABL credit facility and first lien secured notes resulting in a 'BB-' rating and a Recovery Rating of 'RR6' for the senior unsecured level resulting in a 'CCC' rating. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Total debt/EBITDA sustained below 5.0x; -- EBITDA margins sustained above 6%. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Total debt/EBITDA sustained above 7.5x; -- FFO Fixed Charge Coverage Ratio sustained below 2.0x; -- A material weakening of domestic steel market conditions leading to significantly larger than expected negative FCF. LIQUIDITY AND DEBT STRUCTURE Satisfactory Liquidity: As of March 31, 2020, U. S. Steel has cash and cash equivalents of $1.35 billion and $300 million available under its $2.0 billion ABL credit facility. U. S. Steel also had $152 million available under its USSK credit facilities and $13 million under its USS-POSCO Industries (UPI) credit facility. U. S. Steel must maintain a fixed charge coverage ratio of at least 1.0x when availability under the ABL credit facility is less than the greater of a) 10% of aggregate commitments and b) $200 million. ESG CONSIDERATIONS The highest level of ESG credit relevance, if present, is a score of 3. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity(ies), either due to their nature or to the way in which they are being managed by the entity(ies). WIDEOPENWEST FINANCE: S&P Affirms 'B' Issuer Credit Rating ---------------------------------------------------------- S&P Global Ratings affirmed all of its ratings on U.S.-based cable provider WideOpenWest Finance LLC (WOW), including its 'B' issuer credit rating. "The affirmation reflects our expectation that WOW's leverage will remain steady in the mid- to high-5x area over the next year. As part of our review, we revised our downgrade threshold for the company at the current rating to 6.5x from 7.0x to reflect our expectation for weaker business conditions that will likely lead to continued top-line pressure. The tighter threshold also reflects our view of the company's business position relative to that of its peers," S&P said. "Despite our expectation for increased top-line pressure and lower FOCF generation in 2020 due to the effects of COVID-19, we believe that WOW--like many cable operators--is well positioned amid the current recession given the importance of the fast and reliable broadband internet connections it offers," the rating agency said. S&P expects the company's leverage to improve on low- to mid-single digit percent EBITDA growth in 2021 primarily due to a recovery in the demand for advertising and commercial services. Over the longer-term, S&P believes WOW will continue to improve its leverage via increasing EBITDA due to the continued shift in its product mix toward higher-margin high-speed-data (HSD) services and away from video as well as voluntary debt repayment as its capital intensity winds down. S&P's assessment of WOW's business risk continues to reflect its market position as a cable overbuilder. The company must routinely invest in its network and maintain better-than-average service to compete effectively with the larger, better-capitalized incumbent cable operators, such as Comcast and Charter. In addition, WOW lacks material scale, which limits its ability to negotiate favorable programming contracts. These secular headwinds, along with competition from over-the-top (OTT) streaming services, have pressured its subscriber metrics. There is also the longer-term threat for pricing regulation if the Federal Communications Commission (FCC) classifies internet service providers (ISPs) as common carries under Title II of the Communications Act of 1934. However, these weaknesses are partially offset by WOW's good revenue visibility due to the increased demand for high-margin broadband, which has helped it maintain EBITDA margins in the mid-30% area. The company reported residential penetration rates for its video and broadband services of about 11% and 25%, respectively. This is well below average as most cable incumbents have video penetration rates in the low-30% area and HSD penetration rates in the mid-40% area. Notwithstanding the company's superior broadband offerings, its position as an overbuilder contributes to its low HSD penetration rates relative to those of its peer group. Furthermore, its EBITDA margin is low relative to those of most midsize incumbent cable providers. WOW's strategy is to increase the penetration of its HSD services and expand its commercial customer base while de-emphasizing its lower-margin video services as higher programming expenses continue to reduce the segment's profitability. The company is also expanding its network into contiguous markets to support its customer growth, which S&P views favorably, although this is also constraining its FOCF generation. The stable outlook reflects S&P's expectation that Englewood, Colo.-based WOW will maintain EBITDA margins in the mid-30% area and generate break-even FOCF despite its competitive pressures and the headwinds from COVID-19. "We could lower our rating on WOW if aggressive competition weakens its pricing and leads to substantial video subscriber churn such that it generates negative FOCF. We could also lower our ratings if WOW initiated a debt-financed acquisition that would increase its leverage above 6.5x," S&P said. "We could raise our rating on WOW if it maintained leverage of less than 5.0x and increased its FOCF-to-debt ratio above 5%. We do not view this as likely in the near term given our expectation that it will maintain leverage in the mid- to high-5x area and generate break-even FOCF in 2020," the rating agency said. WILSONART LLC: S&P Alters Outlook to Negative, Affirms 'B+' ICR --------------------------------------------------------------- S&P Global Ratings revised its outlook on Austin, Texas-based engineered surfaces company Wilsonart LLC to negative from stable and affirmed its B+ issuer credit rating. S&P affirmed its 'B+' issue-level rating on the company's $1.475 billion senior secured term credit facility. S&P expects reduced demand for commercial and residential construction as well as repair and remodeling spending, which are key end markets for Wilsonart. Wilsonart generates approximately 70% of its revenues in the United States and the remaining 30% in Europe, and for 2020 S&P forecasts real GDP will contract 5.2% and 7.3% the U.S and the eurozone, respectively. S&P believes recessionary pressures will have a corresponding negative impact on Wilsonart's commercial (75% of revenues) and residential construction (25% of revenues) end markets. In addition, Wilsonart derives a large portion of revenues (65%) from repair and remodeling spending, which could be depressed as household incomes and consumer confidence is depleted. S&P is forecasting revenues will be down 10%-12% in 2020, though it expects a 3% to 5% increase in 2021. The rating agency expects debt leverage to increase to about 8.0x-8.5x for 2020, up from 7.3x at the end of 2019. It forecasts the majority of the decline in commercial and residential construction to occur in the second and third quarters of 2020. This timeline overlaps with when Wilsonart typically generates the majority of its revenues, as spring and summer are more favorable for construction and renovation. About 50% of Wilsonart's costs are variable and the company is managing its spending to match demand, including furloughing employees where appropriate. Wilsonart is also taking advantage of government-sponsored salary support programs for its employees, especially in Europe. Its geographic diversity also mitigates some of the impact. Despite this, S&P now estimates EBITDA will decline 10%-15% in 2020 from $237 million in 2019. This results in leverage increasing to 8.0x-8.5x in 2020, compared to 7.3x in 2019 and S&P's prior expectations of 6x-7x. S&P expects Wilsonart to generate positive free cash flows that support its liquidity over the next 12 months. Despite the weaker revenue and earnings generation, S&P expects Wilsonart to generate about $60 million to $80 million in free cash flows in 2020. This is due to Wilsonart scaling back its cash outflows, including a 50% reduction in capital spending over the rest of 2020 as well as working capital management. The company started 2020 with about $133 million in balance sheet cash, primarily as a result of the sale of its Asia business. In March 2020, the company drew almost the full amount of its $175 million cash flow revolving credit facility as a precautionary measure. Although Wilsonart is financial sponsor-owned, which S&P typically associates with a more-aggressive financial policy, management has indicated a plan to repay the amount borrowed on the revolver by year-end 2020. In addition, in March 2020, Wilsonart's board of directors approved that first quarter dividends be paid in preferred stock to preserve cash. The negative outlook reflects the risk that adjusted leverage could remain elevated above 8x if recessionary pressures persist and end market demand failed to improve or worsened over the next 12 months. The negative outlook also incorporates the risk that liquidity could be constrained if the company does not refinance its revolving credit facility over the next 12 months. S&P could lower its rating on Wilsonart over the next 12 months if weak credit measures persisted beyond 2020, resulting in -- Debt to EBITDA sustained above 8x with limited prospects of improvement; -- EBITDA interest coverage maintained below 2x; or -- Liquidity becoming less than adequate, which could occur if Wilsonart is unable to refinance its revolving credit facility. S&P could revise its outlook back to stable over the next 12 months if macroeconomic conditions and end-market demand trends improves such that the company sustains debt to EBITDA below 8x. WWEX UNI: S&P Alters Outlook to Negative, Affirms 'B-' ICR ---------------------------------------------------------- S&P Global Ratings revised its outlook to negative from stable and affirmed its 'B-' issuer credit rating. At the same time, S&P affirmed its 'B-' issue-level ratings on the company's first-lien term loan and revolving line of credit. The '3' recovery ratings are unchanged, indicating its expectation for meaningful recovery (50%-70%; rounded estimate: 55%) in the event of a payment default. S&P is also affirming its 'CCC' issue-level rating on the company's second-lien term loan. The rating agency expects lower-than-anticipated demand stemming from the coronavirus pandemic and U.S. recession to weaken the company's credit metrics in the near term. It expects WWEX's revenues in 2020 to be about flat to 2019 levels, as the impact from lower freight volumes is somewhat offset by additional revenues from previous acquisitions. S&P does not assume a meaningful impact on the company's profitability this year, as the rating agency views the company's cost structure as relatively flexible. While COVID-19 market conditions will likely impair EBITDA margins, S&P expects this will be mostly offset by the company's cost reductions. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety The negative outlook on WWEX reflects S&P's view that the company will experience lower-than-expected revenue and earnings this year as a result of the U.S. recession, resulting in debt to EBITDA about 8x in 2020. "We could lower our rating on WWEX in the next 12 months if revenue and margins deteriorate substantially, resulting in negative free operating cash flow or constrained liquidity, or if we view the capital structure as unsustainable. In addition, we could lower the rating if we believe the company is vulnerable and dependent upon favorable business, financial, and economic conditions to meet its financial commitments. Although not expected, this could occur if the industry's competitive dynamics shift such that WWEX were unable to honor its agreement with United Parcel Service Inc. (UPS)," S&P said. "We could revise the outlook to stable if FOCF remains positive on a sustained basis and the company maintains sufficient headroom under its credit facility covenants. Additionally, we would expect an improving trend in the company's debt to EBITDA ratio. This could occur because of stronger-than-expected revenue and cash flow due to end-market demand," the rating agency said. XPLORNET COMMUNICATIONS: Moody's Assigns B3 CFR, Outlook Stable --------------------------------------------------------------- Moody's Investors Service assigned ratings to Xplornet Communications Inc. (NEW) consisting of a B3 corporate family rating, B3-PD probability of default rating (PDR), and B3 ratings to the company's proposed new senior secured revolving credit facility and senior secured term loan. The ratings outlook is stable. Xplornet is being acquired by Stonepeak Infrastructure Partners (Stonepeak). Proceeds from a new C$1,275 million (US$ equivalent) senior secured term loan, together with about C$1,136 million (US$ equivalent) of common equity contribution from Stonepeak, will be used to acquire the company for C$2,210 million, return C$50 million of cash to the balance sheet, and the remainder will be used to pay fees and expenses. The company is also putting in place a new C$150 million (US$ equivalent) senior secured revolving credit facility, which is not expected to be drawn at close. Xplornet's existing debt of about $845 million will be repaid at close. When the financing transaction closes and all related debt obligations are repaid, Moody's will withdraw all the previously existing ratings of the former Xplornet entity, including the B3 CFR, B3-PD PDR, Ba3 senior secured revolving credit facility rating, B1 senior secured term loan B rating, and Caa2 senior unsecured notes ratings. Moody's will also withdraw the outlook. "Xplornet's B3 CFR is driven by its elevated leverage from the ownership change and its inability to fund growth from internally generated cash flow, mitigated by its strong growth prospects", said Peter Adu, a Moody's Vice President and Senior Analyst. Ratings Assigned: Issuer: Xplornet Communications Inc. (NEW) Corporate Family Rating, B3 Probability of Default Rating, B3-PD C$150 million (US$ equivalent) senior secured revolving credit facility due 2025, B3 (LGD3) C$1,275 million (US$ equivalent) senior secured term loan due in 2027, B3 (LGD3) Outlook Action: Assigned as Stable Ratings and Outlook to be withdrawn at close: Issuer: Xplornet Communications Inc. Corporate Family Rating, B3, to be withdrawn at close Probability of Default Rating, B3-PD; to be withdrawn at close $70 million senior secured revolving credit facility due in 2021, Ba3 (LGD1); to be withdrawn at close $440 million (face value) senior secured term loan B due in 2021, B1 (LGD2); to be withdrawn at close $260 million (face value) senior unsecured notes due in 2022, Caa2 (LGD5); to be withdrawn at close $75 million (face value) senior unsecured notes due in 2022, Caa2 (LGD5); to be withdrawn at close Stable Outlook; to be withdrawn at close RATINGS RATIONALE Xplornet's B3 CFR is constrained: (1) adjusted Debt/EBITDA of 7.2x for 2019, pro forma for the new capital structure, declining towards 6.5x in the next 12 to 18 months; (2) expected negative free cash flow generation due to ongoing capital spending to build out its network and deploy new wireless and satellite broadband technologies; and (3) small scale. The company rating benefits from: (1) strong subscriber and revenue growth as it focuses on a target market of about 2.8 million rural/remote Canadian households that currently do not have high speed internet; (2) its leading market position in that market; (3) good liquidity; (4) a supportive regulatory framework; and (5) limited competition to date from cablecos and telcos in its rural/remote target market. The B3 rating on the revolving credit facility and term loan is at the same level as the CFR, because both instruments are pari passu and comprise the bulk of the debt in the capital structure. Xplornet has good liquidity over the next 12 months, with about C$200 million of liquidity sources to fund about C$38 million of debt maturities and cash burn over the next four quarters. Sources include C$50 million of cash when the refinancing transaction closes and full availability under its C$150 million (US$ equivalent) revolving credit facility due in 2025. Cash uses comprise about C$13 million of term loan repayment and about C$25 million of expected negative free cash flow through the next four quarters, mainly due to capital spending to build out its network (excluding spectrum spending). The company will have a springing net leverage covenant when the transaction closes and cushion is expected to exceed 30% if applicable. Xplornet has limited flexibility to generate liquidity from asset sales. The stable outlook reflects expected strong operating performance and good liquidity as leverage declines towards 6.5x through the next 12 to 18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Xplornet's rating could be upgraded if it generates sustainable positive free cash flow and sustains leverage below 6x (pro forma 7.2x for 2019) The rating could be downgraded if Xplornet's liquidity becomes weak, likely due to negative free cash flow generation for an extended period or if operating performance deteriorates, evidenced by material subscriber and revenue declines and leverage is sustained above 7.5x (pro forma 7.2x for 2019) Xplornet's social risk is low, but as with many companies, a cyber breach will be material if it occurs. Xplornet will benefit from society's continual reliance on internet connectivity, but given the private and personal data it handles, a cyber breach will be costly to the company. Xplornet's governance risk is high given its ownership by private equity. The buyout transaction elevates leverage and even if deleveraging occurs, there is the potential for leverage to increase as and when the owner seeks a return on its investment. The principal methodology used in these ratings was Telecommunications Service Providers published in January 2017. Xplornet, headquartered in Woodstock, New Brunswick, offers broadband internet to residential and commercial customers in rural areas in Canada using fixed wireless and satellite technology platforms. Revenue for the year ended December 31, 2019 was C$420 million. YAK ACCESS: Bank Debt Trades at 38% Discount -------------------------------------------- Participations in a syndicated loan under which Yak Access LLC is a borrower were trading in the secondary market around 62 cents-on-the-dollar during the week ended Fri., May 15, 2020, according to Bloomberg's Evaluated Pricing service data. The bank debt traded around 69 cents-on-the-dollar for the week ended May 8, 2020. The $180.0 million facility is a Term loan. The facility is scheduled to mature on July 11, 2026. As of May 15, 2020, the amount is fully drawn and outstanding. The Company's country of domicile is United States. YESHIVA UNIVERSITY: Moody' Affirms B3 Rating on $146MM Bonds ------------------------------------------------------------ Moody's Investors Service has revised Yeshiva University's (NY) outlook to stable from positive and affirmed the B3 rating on $146 million of revenue bonds outstanding. RATINGS RATIONALE The revision of the outlook to stable reflects additional operational challenges in light of the coronavirus pandemic and near-term uncertainties for key revenue streams. The disruptions caused by the pandemic are likely to pause progress on a multi-year plan to achieve breakeven operating performance from cash flow. Management is still projecting modest improvement in fiscal 2020 performance relative to fiscal 2019, but this relies on achieving fundraising targets established before the current period of financial market volatility. Uncertainties around enrollment and the potential impact on tuition revenue in fall 2020 creates additional headwinds that will be difficult to financially offset. Investment market volatility and declining liquidity will further restrict Yeshiva's operating flexibility through a challenging operating environment. Yeshiva University's B3 rating positively incorporates the university's scale, specific market niche which provides for market distinction, historically strong fundraising, and the likelihood of full recovery in the event of default. Favorably, management has successfully narrowed the magnitude of annual operating deficits, in line with its ongoing fiscal stabilization plan. Strong projected 11.4% year over year growth of net tuition revenue in fiscal 2020 is credit positive, reflecting pre-coronavirus progress toward achieving a more sustainable business model. However, a multi-year approach to achieve breakeven performance will become more difficult to achieve and the university will continue to draw down liquidity through at least fiscal 2022, if not beyond. Moreover, low investment in physical facilities due to constrained cash flow highlights escalated deferred maintenance, a longer term credit challenge. While the university has already monetized a portion of real estate to bolster liquidity, the rating continues to incorporate the likelihood of full recovery for bondholders from other core campus real estate assets. However, if New York City real estate prices face downward pressure as a result of the pandemic, this could add additional credit challenges. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, 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. RATING OUTLOOK The revision to the stable outlook incorporates new operational risks caused by the pandemic that may constrain deficit reduction strategies. While Yeshiva was experiencing gradual credit momentum, the current operating environment is likely to impede progress on business transformation goals. The outlook further reflects expectations that Yeshiva's structural deficit will remain manageable in fiscal 2021 depending on the duration and magnitude of the pandemic. FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS - Ability to maintain progress on business transformation and enterprise-wide growth as evidenced by sustained elimination of operating deficits and bolstering cash flow margins - Sustained growth of net tuition - Demonstrated ability to rebuild balance sheet resources and unrestricted liquidity through expanding donor support and improved financial performance FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS - More rapid or steep decline in liquidity than currently anticipated - Inability to reduce operating deficits in line with expectations - Additional borrowing as operating cash flow is currently insufficient to meet annual debt service requirements, thus relying on available reserves to service these obligations LEGAL SECURITY The Series 2009 and 2011A revenue bonds are unsecured general obligations of the university. Bondholder security is subordinate to the mortgage and cash flow of certain parcels of campus real estate securing a $140 million loan ("Y Properties"). Financial covenants associated with the privately-placed notes include maintaining enterprise-wide liquidity and net assets in excess of specified levels. The university maintains a good cushion above these thresholds. USE OF PROCEEDS Not applicable PROFILE Yeshiva University is a moderately-sized private university with a distinct Jewish-focused mission. The university provides undergraduate, graduate, professional, and post-doctoral education and training. It is located in New York City, with three campuses in Manhattan and one in the Bronx. Yeshiva enrolls nearly 5,000 FTEs with graduate school education - including schools of law, social work, business, psychology - accounting for the largest area of growth. Albert Einstein College of Medicine (AECOM) is a separate, independent, affiliated college of medicine. METHODOLOGY The principal methodology used in these ratings was Higher Education published in May 2019. YOUNG MEN'S: Case Summary & 7 Unsecured Creditors ------------------------------------------------- Debtor: The Young Men's Christian Association of Topeka, Kansas 3635 S.W. Chelsea Drive Topeka, KS 66614 Business Description: The Debtor is a tax-exempt organization that is focused on youth development, healthy living, and social responsibility. Its programs, services, and initiatives enable kids to realize their potential, prepare teens for college, offer ways for families to have fun together, empower people to be healthier in spirit, mind and body, prepare people for employment. For more information, visit https://www.ymcatopeka.org. Chapter 11 Petition Date: May 21, 2020 Court: United States Bankruptcy Court District of Kansas Case No.: 20-20786 Judge: Hon. Dale L. Somers Debtor's Counsel: Edward J. Nazar, Esq. HINKLE LAW FIRM LLC 1617 N. Waterfront Parkway, Suite 400 Wichita, KS 67206 Tel: 316-267-2000 Email: enazar@hinklaw.com Total Assets: $4,850,289 Total Liabilities: $5,490,339 The petition was signed by John Mugler, president and chief executive officer. A copy of the petition containing, among other items, a list of the Debtor's seven unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/uqiJlR ZACHAIR LTD: Court Signs Bridge Order Extending Exclusivity Period ------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Maryland issued a bridge order extending the exclusivity period for Zachair, Ltd. to file a Chapter 11 plan and solicit votes from creditors through the date on which the court enters an order resolving the company's exclusivity motion. Zachair had earlier asked the court to extend the exclusivity period by 120 days to allow the company to continue its diligent efforts to market and sell its real property located in Prince George's County, Md. The property has been operated as an airfield. In 2010, Zachair hired a broker to sell the property. A contract of sale was entered in 2013 but it was eventually terminated by the company, which led to disputes that are pending in the Circuit Court for Prince George's County, Md. About Zachair Ltd. Zachair, Ltd. -- http://www.hydefield.com/-- was formed by Dr. Nabil Asterbadi to acquire Hyde Field, an airport for commercial and general aviation. Hyde Field is located near Andrews Air Force Base, National Harbor, Downtown Washington DC, and nearby Northern Virginia. It offers a 3000' lighted runway with a day and night instrument approach. Based in Clinton, Md., Zachair, Ltd. filed a Chapter 11 petition (Bankr. D. Md. Case No. 20-10691) on Jan. 17, 2020. In the petition signed by Nabil J. Asterbadi, president, Debtor was estimated to have $10 million to $50 million in assets and $1 million to $10 million in liabilities. Judge Thomas J. Catliota oversees the case. Whiteford Taylor & Preston, LLP is Debtor's legal counsel. [] BOOK REVIEW: The Sorcerer's Apprentice - Medical Miracles ------------------------------------------------------------ Author: Sallie Tisdale Publisher: BeardBooks Softcover: 270 pages List Price: $34.95 Order your own personal copy at http://is.gd/9SAfJR An earlier edition of "The Sorcerer's Apprentice" won an American Health Book Award in 1986. The book has been recognized as an outstanding book on popular science. Tisdale brings to her subject of the wide nd engrossing field of health and illness the perspective, as well as the special sympathies and sensitivities, of a registered nurse. She is an exceptionally skilled writer. Again and again, her descriptions of ill individuals and images of illnesses such as cancer and meningitis make a lasting impression. Tisdale accomplishes the tricky business of bringing the reader to an understanding of what persons experience when they are ill; and in doing this, to understand more about the nature of illness as well. Her style and aim as a writer are like that of a medical or science journalist for leading major newspaper, say the "New York Times" or "Los Angeles Times." To this informative, readable style is added the probing interest and concern of the philosopher trying to shed some light on one of the central and most unsettling aspects of human existence. In this insightful, illuminating, probing exploration of the mystery of illness, Tisdale also outlines the limits of the effectiveness of treatments and cures, even with modern medicine's store of technology and drugs. These are often called "miracles" of modern medicine. But from this author's perspective, with the most serious, life-threatening, illnesses, doctors and other health-care professionals are like sorcerer's trying to work magic on them. They hope to bring improvement, but can never be sure what they do will bring it about. Tisdale's intent is not to debunk modern medicine, belittle its resources and ways, or suggest that the medical profession holds out false hopes. Her intent is do report on the mystery of serious illness as she has witnessed it and from this, imagined what it is like in her varied work as a registered nurse. She also writes from her own experiences in being chronically ill when she was younger and the pain and surgery going with this. She writes, "I want to get at the reasons for the strange state of amnesia we in the health professions find ourselves in. I want to find clues to my weird experiences, try to sense the nature of being sick." The amnesia of health professionals is their state of mind from the demands placed on them all the time by patients, employers, and society, as well as themselves, to cure illness, to save lives, to make sick people feel better. Doctors, surgeons, nurses, and other health-care professionals become primarily technicians applying the wonders of modern medicine. Because of the volume of patients, they do not get to spend much time with any one or a few of them. It's all they can do to apply the prescribed treatment, apply more of it if it doesn't work the first time, and try something else if this treatment doesn't seem to be effective. Added to this is keeping up with the new medical studies and treatments. But Tisdale stepped out of this problem-solving outlook, can-do, perfectionist mentality by opting to spend most of her time in nursing homes, where she would be among old persons she would see regularly, away from the high-charged atmosphere of a hospital with its "many medical students, technicians, administrators, and insurance review artists." To stay on her "medical toes," she balanced this with working occasional shifts in a nearby hospital. In her hospital work, she worked in a neonatal intensive care unit (NICU), intensive care unit (ICU), a burn center, and in a surgery room. From this combination of work with the infirm, ill, and the latest medical technology and procedures among highly-skilled professionals, Tisdale learned that "being sick is the strangest of states." This is not the lesson nearly all other health-care workers come away with. For them, sick persons are like something that has to be "fixed." They're focused on the practical, physical matter of treating a malady. Unlike this author, they're not focused consciously on the nature of pain and what the patient is experiencing. The pragmatic, results-oriented medical profession is focused on the effects of treatment. Tisdale brings into the picture of health care and seriously-ill patients all of what the medical profession in its amnesia, as she called it, overlooks. Simply in describing what she observes, Tisdale leads those in the medical profession as well as other interested readers to see what they normally overlook, what they normally do not see in the business and pressures of their work. She describes the beginning of a hip-replacement operation, the surgeon "takes the scalpel and cuts -- the top of the hip to a third of the way down the thigh -- and cuts again through the globular yellow fat, and deeper. The resident follows with a cautery, holding tiny spraying blood vessels and burning them shut with an electric current. One small, throbbing arteriole escapes, and his glasses and cheek are splattered." One learns more about what is actually going on in an operation from this and following passages than from seeing one of those glimpses of operations commonly shown on TV. The author explains the illness of meningitis, "The brain becomes swollen with blood and tissue fluid, its entire surface layered with pus . . . The pressure in the skull increases until the winding convolutions of the brain are flattened out . . . The spreading infection and pressure from the growing turbulent ocean sitting on top of the brain cause permanent weakness and paralysis, blindness, deafness . . . ." This dramatic depiction of meningitis brings together medical facts, symptoms, and effects on the patient. Tisdale does this repeatedly to present illness and the persons whose lives revolve around it from patients and relatives to doctors and nurses in a light readers could never imagine, even those who are immersed in this world. Tisdale's main point is that the miracles of modern medicine do not unquestionably end the miseries of illness, or even unquestionably alleviate them. As much as they bring some relief to ill individuals and sometimes cure illness, in many cases they bring on other kinds of pains and sorrows. Tisdale reminds readers that the mystery of illness does, and always will, elude the miracle of medical technology, drugs, and practices. Part of the mystery of the paradoxes of treatment and the elusiveness of restored health for ill persons she focuses on is "simply the mystery of illness. Erosion, obviously, is natural. Our bodies are essentially entropic." This is what many persons, both among the public and medical professionals, tend to forget. "The Sorcerer's Apprentice" serves as a reminder that the faith and hope placed in modern medicine need to be balanced with an awareness of the mystery of illness which will always be a part of human life. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2020. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***