/raid1/www/Hosts/bankrupt/TCR_Public/200601.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, June 1, 2020, Vol. 24, No. 152
Headlines
444 EAST 13: 444 Lender to Provide Funding in Sale Plan
AAR CORP: S&P Cuts ICR to 'BB' on Impact From Coronavirus Pandemic
ADIL LLC: Gets Authorization to Use Cash Collateral
AGERA ENERGY: Unsecured Creditors to Recover 1% to 16% in Plan
AH TWO: Voluntary Chapter 11 Case Summary
AIR CANADA: Moody's Cuts CFR to Ba2 & Sr. Unsec. Rating to Ba3
AKORN INC: In Chapter 11 for Sale; Lenders to Open Bidding
ALL FAMILY FINANCE: June 8 Hearing on Disclosure Statement
ALLEGIANT TRAVEL: Moody's Confirms Ba3 Corp. Family Rating
AMERICAN AIRLINES: Moody's Cuts CFR to B2 & Unsec. Ratings to Caa1
AMERICAN CENTER: Engelberg Objects to Plan Disclosures
AMERICAN TRAILER: S&P Alters Outlook to Negative, Affirms 'B' ICR
ARCHDIOCESE OF NEW ORLEANS: Hires Donlin Recano as Claims Agent
ARMOR HOLDING: S&P Withdraws 'B-' Issuer Credit Rating
ARR INVESTMENTS: June 10 Evidentiary Hearing on Disclosures
ART VAN FURNITURE: Buyer to Reopen Stores as 'Loves Furniture'
ASSUREDPARTNERS INC: Moody's Rates New $300MM Sec. Term Loan 'B2'
BALTIMORE 24 INVESTORS: Hires Kutak Rock as Special Counsel
BLEU'SPA INC: Voluntary Chapter 11 Case Summary
BORDEN DAIRY: Files Plan That Has Reorganization/Sale Options
BORDEN DAIRY: June 4 Hearing on Disclosure Statement
C21 INVESTMENTS: Addresses Market Conditions to Shareholders
C21 INVESTMENTS: Reports Revenue of $37.7 Million for Fiscal 2020
CAMP GALILEO: In Chapter 11 as Pandemic Havocs Finances
CARMEL MEDICAL: Claims to be Paid From Sale/Refinancing of Property
CATE STREET: PE Firm Files for Chapter 7 Liquidation
CBL & ASSOCIATES: Moody's Cuts CFR to Ca & Sr. Unsec. Rating to C
CCI CONSTRUCTION: Unsecureds Who OK Plan to Get 96 Monthly Payments
CENTENNIAL RESOURCE: S&P Upgrades ICR to 'CCC+'; Outlook Negative
CENTRIC BRANDS: Files for Chapter 11 With Debt-for-Equity Plan
CHHATRALA GRAND: Plan of Reorganization Confirmed by Judge
CHIEF POWER FINANCE: S&P Lowers Term Loan Rating to 'CCC-'
CHINOS HOLDINGS: Taps Weil Gotshal as Lead Counsel
CLARE OAKS: Bondholders Seek to Alter Residents' Contracts in Plan
COATESVILLE AREA SD: Moody's Rates Series 2020A/2020B Bonds 'Ba3'
COLORADO GOLDFIELDS: Unsec. to Get Paid by Loan Obligation Proceeds
COMERICA INCORPORATED: Fitch Rates $400MM Preferred Stock 'BB+'
COSTA HOLLYWOOD: June 24 Disclosure Statement Hearing Set
CRAFTWORKS PARENT: Senior Lender DBFLF Buying All Assets
CROSSROADS HEALTH: June 17 Plan & Disclosure Hearing Set
DANCOR TRANSIT: Proposed $2.64M Sale of Dallas Property Approved
DANCOR TRANSIT: Proposes Wooley Auction of Equipment on June 10
DCP MIDSTREAM: Moody's Alters Outlook on Ba2 CFR to Stable
DEXKO GLOBAL: Moody's Alters Outlook on B2 CFR to Negative
DFW WINGS: Unsecured Creditors to Have 10% Recovery over 5 Years
DISCOVERY DAY: Voluntary Chapter 11 Case Summary
DIVERSIFIED HEALTHCARE: Moody's Rates Sr. Unsecured Notes 'Ba1'
DMDS LLC: Voluntary Chapter 11 Case Summary
DOMINION DIAMOND: Washington Cos. to Buy Assets for $126M
DORIAN LPG: Reports Q4 and Full Year 2020 Financial Results
DOUGLAS DYNAMICS: S&P Affirms 'BB-' ICR; Ratings Off Watch Negative
ECS REFINING: June 9 Online Auction Scheduled for Recycling Plant
EDGEMARC ENERGY: June 23 Plan & Disclosure Hearing Set
EF-290 LLC: Voluntary Chapter 11 Case Summary
ENERGY SAVING: Seeks to Hire Bourey Law Offices as Counsel
ENO RIVER: Moody's Rates Series 2020A & 2020B Bonds 'Ba1'
EXIDE HOLDINGS: Returns to Chapter 11; EMEA and AP Biz. for Sale
EXIDE TECHNOLOGIES: Judge Approves First Day Motions
FE-FA CORP: Riso Buying Bayville Property for $350K
FIRST HORIZON: Fitch Rates $150MM Series E Preferred Stock 'BB-'
FIRSTLIGHT HOLDCO: Moody's Affirms B3 CFR, Outlook Stable
FORD MOTOR: Moody's Confirms Ba2 CFR & Alters Outlook to Negative
FORD MOTOR: Moody's Confirms Ba2 LT Senior Unsecured Rating
FREEDOM OIL: Access to Cash Collateral Allowed on Interim Basis
FREEDOM OIL: Enters Bankruptcy as Revenues Plunge
FREEDOM OIL: July 10 Auction of Substantially All Assets Set
FRONTIER COMMUNICATIONS: Hires Evercore Group as Investment Banker
FRONTIER COMMUNICATIONS: Hires Kirkland & Ellis as Legal Counsel
FRONTIER COMMUNICATIONS: Hires Wilkinson Barker as Special Counsel
FRONTIER COMMUNICATIONS: Hires Willkie Farr as Legal Counsel
FRONTIER COMMUNICATIONS: Seeks to Hire PwC as Tax Advisor
FRONTIER COMMUNICATIONS: Taps Carlin Adrianopoli of FTI as EVP
FRONTIER COMMUNICATIONS: Taps CMA Strategy as Telecom Consultant
FRONTIER COMMUNICATIONS: Taps Cravath Swaine as Special Counsel
FRONTIER COMMUNICATIONS: Taps Delta Partners as Business Consultant
FRONTIER COMMUNICATIONS: Taps Ernst & Young to Provide Tax Services
FRONTIER COMMUNICATIONS: Taps KMPG to Provide Tax Advisory Services
FURIE OPERATING: Further Fine-Tunes Disclosure Statement
GARDEN FRESH: Files for Chapter 7 as Buffet Restaurants Shuttered
GCI LLC: Moody's Assigns B2 Corp. Family Rating
GIGA-TRONICS INC: Posts $2 Million Net Loss in FY 2019
GORDON JENSEN: Hires Marcus & Millichap as Real Estate Agent
GUITAR CENTER: S&P Upgrades ICR to 'CCC-' on Distressed Exchange
HAWAIIAN HOLDINGS: Moody's Cuts CFR to B1, Outlook Negative
HORNBECK OFFSHORE: Davis, Porter Represent Secured Lender Group
HORNBECK OFFSHORE: In Chapter 11 to Seek OK of Prepackaged Plan
IGLESIA TABERNACULO: Seeks to Hire Landrau Rivera as Legal Counsel
IMAGEWARE SYSTEMS: Kristin Taylor Named to Board of Directors
IMPACT GLASS: Unsecured Creditors to Receive $235K Over 5 Years
IN MARKETING GROUP: Unsecureds to Get Up to 34% Founder's Deal
INTELSAT SA: Gets Approval to Hire Stretto as Claims Agent
INVERNESS TWO: Voluntary Chapter 11 Case Summary
J. HILBURN INC: Seeks to Hire MMG Advisors as Investment Banker
JAGGED PEAK: Case Summary & 8 Unsecured Creditors
JC PENNEY: Closing 242 of 846 Store Locations
JDUB'S BREWING: Has Until July 6, 2020 to File Plan
JETBLUE AIRWAYS: Moody's Cuts CFR to Ba2 & Sr. Sec. Rating to Ba1
JOHN BARRETT: Voluntary Chapter 11 Case Summary
KRYSTAL CO: Sells Itself Out of Bankruptcy by Takeover Deal
LIBERTY OILFIELD: Considers Bankruptcy Filing Again
LONGVIEW POWER: Court Confirms Plan of Reorganization
LSC COMMUNICATIONS: Lowenstein Represents CNG, 4 Others
LUX TEMPLUM: Files Bankruptcy Protection to Keep Business Alive
LVI INTERMEDIATE: Case Summary & 30 Largest Unsecured Creditors
LVI INTERMEDIATE: Vision Group in Chapter 11 to Sell Business
M & C PARTNERSHIP: Administrative Claim to be Paid by Rental Income
MARIA O. MARIA: Seeks to Hire Courtney K. Davy as Legal Counsel
MCL NURSING: July 7 Plan Confirmation Hearing Set
MESA MARKETPLACE: U.S. Trustee Objects to Disclosure Statement
MICI CORP: Case Summary & 20 Largest Unsecured Creditors
MIDTOWN CAMPUS: Unfinished Apartments File for Chapter 11
MOLINA HEALTHCARE: Moody's Rates New $800MM Unsec. Notes 'B2'
MOLINA HEALTHCARE: S&P Affirms 'BB-' ICR, Rates Unsec. Notes 'BB-'
MOTIF DIAMOND: July 24 Plan & Disclosure Hearing Set
NEOVASC INC: Files for CE Mark for Tiara TA Transapical
NEOVASC INC: Offering Convertible Notes & Warrants for $5 Million
NEOVASC INC: Provides Corporate Update
NEW COTAI: Unsecureds to Have 90% Recovery in Debt-for-Equity Plan
NEXTERA ENERGY: S&P Affirms 'BB' ICR on Recent Acquisitions
NORTIS INC: Court Approves $42K Proposed Cure Payment
ORTHO-CLINICAL DIAGNOSTICS: Moody's Rates New Unsec. Notes 'Caa2'
ORTHO-CLINICAL DIAGNOSTICS: S&P Rates Senior Unsecured Debt 'CCC'
OUTPUT SERVICES: S&P Keeps 'CCC+' ICR on Watch Negative
OZ INDUSTRIES: Paramount Buying Almont Property for $321K
P8H INC.: Former Paddle8 CEO Sued in Bankruptcy Court
PARKHILL PEDIATRIC: Voluntary Chapter 11 Case Summary
PG&E CORP: CPUC Approves Chapter 11 Plan of Reorganization
PIER 1 IMPORTS: Court Okays Plan to Wind Down Business Operations
PIER 1 IMPORTS: Unable to Find Buyer, Retailer Winding Down
PIXIUS COMMUNICATIONS: Saved by KwikKom & Wisper Out of Bankruptcy
PROUSYS INC: Has Until Aug. 3, 2020 to File Plan & Disclosures
PS HOLDCO: Moody's Confirms B2 CFR, Outlook Negative
REITMANS: Files Bankruptcy Due to COVID-19 Induced Setbacks
RELIABLE EXPRESS: Voluntary Chapter 11 Case Summary
RELIABLE PROFESSIONAL: Case Summary & 10 Unsecured Creditors
ROVIG MINERALS: $5.25M Sale of Assets to GHI Approved
RYFIELD PROPERTIES: Allowed to Use Cash Collateral on Interim Basis
SABON HOLDINGS: Case Summary & Largest Unsecured Creditors
SD-CHARLOTTE LLC: RTHT Sets Bidding Procedures for All MOD Assets
SECUR O&G: Case Summary & 20 Largest Unsecured Creditors
SFKR LLC: Austin Bank Objects to Disclosure Statement
SFKR LLC: MidSouth VI Objects to Disclosure Statement
SOGIO INVESTMENTS: Case Summary & 8 Unsecured Creditors
SPEEDCAST INT'L: Davis Polk, Rapp Represent Secured Lender Group
STEEL PARTNERS: June 4 Live Virtual Public Asset Auction Set
SVFOODS AVONDALE: Seeks to Hire Planche Politz as Accountant
TECHNICAL COMMUNICATIONS: Incurs $361K Net Loss in First Quarter
TNTMD PA: Unsec. Creditors to Receive $3K Per Quarter Over 5 Years
TUPPERWARE BRANDS: Moody's Cuts CFR to Caa3, Outlook Negative
TYSON FOODS: Non-Supervisory Staff Wage-Fixing Class Suit Ongoing
UNIT CORP: Receives Delisting Notice From New York Stock Exchange
UNITED AIRLINES: Moody's Confirms Ba2 CFR & Ba3 Sr. Unsec. Rating
VIRTUAL CITADEL: Bay Point Advisors Provides $7.5M DIP Loan
WASHINGTON PRIME: Moody's Lowers Corp. Family Rating to Caa3
WATERS RETAIL: Hires LandQwest Commercial as Real Estate Broker
WELDED CONSTRUCTION: Unsec. Creditors to Have 21% Recovery in Plan
WESTJET AIRLINES: Moody's Cuts CFR to B3 & Sr. Sec. Rating to B2
WILLIAM E. ROBINSON: Baxter Buying Mansfield Property for $15K
[*] Judge Aleta Trauger to Get 2020 American Inns of Court Award
[^] BOND PRICING: For the Week from May 25 to 29, 2020
*********
444 EAST 13: 444 Lender to Provide Funding in Sale Plan
-------------------------------------------------------
444 East 13 LLC filed an Amended Plan of Liquidation and an Amended
Disclosure Statement in support of its amended plan of liquidation
dated May 12, 2020.
The Plan described in this Disclosure Statement is premised on the
sale of the Property. Upon confirmation of the Debtor's Plan, the
Plan provides for the sale of Property by the Plan Administrator
pursuant to the Sale and Bid Procedures within 12 months of the
Confirmation Date. The sale transaction provides for 444 Lender to
be the stalking horse bidder for the Property subject to higher or
better bids. If there are multiple offers for the Property, the
Plan Administrator will conduct an auction.
The Plan calls for the secured creditor to establish two escrow
accounts, the Estimated Professional Fee Escrow and the Plan Fund,
which will used to pay the professional fees approved by the
Bankruptcy Court and all other expenses and Classes of Creditors.
The Plan provides that if the secured creditor is not the
successful purchaser, and there are excess proceeds beyond the
secured creditor's secured claim, the proceeds will be distributed
to holders of allowed unsecured creditors on a pro rata basis and
then to Interests, if any monies remain after such Claims are paid
in full.
The Plan Administrator will market the Property for sale for as
much as 12 months pursuant to the Sale and Bid Procedures. 444
Lender will fund the Plan Fund and Estimated Professional Fee
Escrow, and in addition to the Debtor’s Available Cash on the
Effective Date, these funds will pay, on the Effective Date, (i)
the Allowed Claims in Classes 1, 3, and 4, and Administrative
Expense Claims, Priority Tax Claims and Fee Claims; (ii) to fund
the Disputed Claim Reserves; (iii) to fund reserves for
Post-Effective Date Legal Fees; and (iv) to fund reserves for Plan
Administrator fees and expenses subsequent to the Effective Date.
If the Property is sold to a Purchaser other than 444 Lender and
there are excess proceeds beyond their Claim, then Unsecured
Creditors and Interests may be entitled to distributions in
accordance with their statutory priorities.
Each holder of an Allowed General Unsecured Claim in Class 4 will
receive on the Effective Date a distribution equal to their pro
rata share of the General Unsecured Fund (a fund of $25,000) and,
only if the Property is sold to a purchaser other than 444 Lender,
within 30 days from the closing of the Sale Transaction, in final
satisfaction of such Claim, their pro rata share of any Cash
remaining from the Sale Proceeds, if any, after payment in full of
the 444 Lender Secured Claim.
The Debtor, in consultation with 444 Lender, will determine the
amount necessary to be deposited into the Plan Fund and the
Estimated Professional Fee Escrow as reasonably determined by the
Debtor to make the distributions to creditors under the Plan and to
fund any required reserves. 444 Lender will provide a written
commitment for the Plan Fund prior to the commencement of the
Confirmation Hearing. The Plan Fund shall be deposited into the
escrow account of counsel to the Debtor.
A copy of the Amended Disclosure Statement and Amended Plan of
Liquidation dated May 12, 2020, is available at
https://tinyurl.com/yahs34oa from Pacermonitor.com at no charge.
Attorneys for the Debtor:
ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK P.C.
875 Third Avenue
New York, New York 10022
Tel: 212-603-6300
A. Mitchell Greene, Esq.
Robert M. Sasloff, Esq.
Fred B. Ringel, Esq.
About 444 East 13 LLC
444 East 13 LLC owns and operates a residential apartment building
located at 444 East 13th Street in the east village neighborhood of
Manhattan, New York. The property is valued at $11 million.
E. 9th St. Holdings owns and operates a residential apartment
building located at 332 East 9th Street in the east village
neighborhood of Manhattan, New York, valued at $8.82 million.
Meanwhile, E. 10th St. Holdings owns and operates a residential
apartment building located at 251 East 10th Street in the east
village neighborhood of Manhattan, New York, which is valued at
$7.5 million.
The properties are encumbered by mortgages to 444 Lender LLC and E.
Village Lender LLC (assigned to Metropolitan Commercial Bank).
E. 9th St. Holdings, E. 10th St. Holdings and 444 East sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y.
Case Nos. 17-23141 to 17-23143) on July 21, 2017. David Goldwasser,
authorized signatory of GC Realty Advisors LLC, manager signed the
petitions.
At the time of the filing, E. 9th St. Holdings disclosed $8,850,000
in total assets and $6,020,000 in total liabilities. E. 10th St.
Holdings listed $7,590,000 in total assets and $3,980,000 in total
liabilities. 444 East 13 LLC disclosed $11,030,000 in total assets
and $8,980,000 in total debt.
Judge Robert D. Drain presides over the cases.
Robinson Brog Leinwand Greene Genovese & Gluck, P.C., is the
Debtors' bankruptcy counsel. Sheldon Lobel PC, is the special
zoning counsel.
On Nov. 17, 2017, E. 9th St. filed its proposed Chapter 11 plan of
liquidation and disclosure statement.
AAR CORP: S&P Cuts ICR to 'BB' on Impact From Coronavirus Pandemic
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on AAR Corp. to
'BB' from 'BB+'.
AAR's earnings will likely weaken significantly in fiscal 2021
(ending May 31, 2021) because of the coronavirus pandemic and will
likely take longer to recover. The International Air Transport
Association expects global air travel to be down 50% in 2020 and
take at least until 2022 or 2023 to return to 2019 levels. This
will result in significant loss of demand for AAR's aftermarket
parts and maintenance, repair, and overhaul businesses in fiscal
2021. It will only slowly recover thereafter, pressuring earnings.
S&P said, "While we expect the company's defense business (about
40% of revenues) to be relatively unaffected by the pandemic and it
is taking actions to reduce costs, we now expect credit metrics to
be materially worse than our previous forecast, with funds from
operations (FFO) to debt below 20% and debt to EBITDA above 5x in
2021. This compares to our previous expectations of FFO to debt of
36%-40% and debt to EBITDA of 2x-2.4x. However, we expect recovery
in fiscal 2022, as some revenue returns and cost-cutting measures
are fully in place, resulting in FFO to debt of 20%-25% and debt to
EBITDA of 3.3x-3.7x. But this forecast is highly uncertain."
Liquidity will likely be tighter than expected. As a result of
weaker earnings, the cushion under AAR's net debt to EBITDA
covenant (maximum of 3.5x) will likely be tight for 2021, which
will limit revolver availability. AAR has modest cash balances, and
S&P expects it to generate modest free cash flow as there will be
less cash needs for inventory. However, this could weaken if there
are issues collecting accounts receivable from airlines and other
commercial customers.
Environmental, social, and governance (ESG) credit factors for this
credit rating change:
-- Health and safety
The negative outlook on AAR reflects further risk to earnings and
cash flow as a result of the coronavirus pandemic. S&P now expects
credit metrics to be weak in fiscal 2021, with debt to EBITDA above
5x and FFO to debt below 20%, but to recover in fiscal 2022 with
debt to EBITDA of 3.3x-3.7x and FFO to debt of 20%-25%.
S&P said, "We could lower the rating on AAR in the next 12 months
if cash flow is materially weaker, or we believe debt to EBITDA
will remain above 4x and FFO to debt below 20% in fiscal 2022. We
could also lower the rating if the company is at risk of violating
its covenants and we do not expect it to get a waiver. This could
occur if the effects of the coronavirus pandemic are significantly
worse than we expect, AAR cannot cut costs, or it pursues a more
aggressive financial policy.
"We could revise the outlook to stable over the next 12 months if
the company's FFO to debt remains above 20% and free operating cash
flow to debt is 10%. The company would also have to maintain
adequate cushion on its covenants or obtain a waiver. This would
likely be due to a quicker than expected demand recovery or greater
than expected cost savings to offset lower demand."
ADIL LLC: Gets Authorization to Use Cash Collateral
---------------------------------------------------
Judge Ronald King of the U.S. Bankruptcy Court for the Western
District of Texas authorized Adil, LLC seeks to use cash collateral
consisting of inventory and cash, which will include any monies
held in its bank accounts.
Creditors with a valid, pre petition lien on said cash collateral
are each granted a post petition lien on all assets, but only to
the extent that they had a valid pre-petition lien on the
collateral prior to bankruptcy filing. Said post petition liens, if
any, will be in the same priority, if any, that existed prior to
the case being filed.
About Adil LLC
Adil, LLC, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. W.D. Tex. Case No. 20-60166) on March 4, 2020. At the
time of the filing, the Debtor had estimated assets of between
$100,001 and $500,000 and liabilities of between $500,001 and $1
million. The Debtor is represented by John A. Montez, PC.
AGERA ENERGY: Unsecured Creditors to Recover 1% to 16% in Plan
--------------------------------------------------------------
Agera Energy LLC, et al., won court approval of the Disclosure
Statement explaining their Plan.
The hearing to consider confirmation of the Plan will be held
before the Honorable Robert D. Drain, U.S. Bankruptcy Judge, in the
United States Bankruptcy Court for the Southern District of New
York, 300 Quarropas Street, White Plains, New York 10601, on June
12, 2020 at 2:00 p.m. (Prevailing Eastern Time), as such date may
be continued or adjourned by the Bankruptcy Court.
Objections or proposed modifications, if any, to the Plan must
filed and served no later than 4:00 p.m. (Prevailing Eastern Time)
on June 9, 2020.
The Debtors will file and serve the "plan supplement notice" as
soon as reasonably practicable following the date on which the Plan
Supplement is filed pursuant to the terms of the Plan, but in any
event no later than 10 days prior to the Confirmation Hearing.
Ballots completed by holders of Claims in Classes 1B, 2, 3, or 4
must be actually received by the voting agent on or before 4:00
p.m. (Prevailing Eastern Time) on June 9, 2020.
Agera Energy LLC, et al., submitted a Second Amended Disclosure
Statement.
In connection with the sale of the Agera Opco Entities' Assets, the
Assigned Contracts were transferred to the Stalking Horse Bidder
during the period from Nov. 20, 2019 through March 19, 2020 for
those customers who did not otherwise unilaterally choose to switch
to a different service provider. All customers whose contracts
did not constitute Assigned Contracts were either transferred to
different service providers or returned to utility service prior to
March 31, 2020, with only a few exceptions whose transfers will be
effective in April, 2020. The final purchase price pursuant to the
Sale is expected to be approximately $17.75 million. There are
currently no claims submitted by the Stalking Horse Bidder for
indemnification under the Sale documents, but such claims may be
made through June 17, 2020, and, if made, could result in a
reduction of the purchase price to be paid to Debtors.
The Debtors estimate that, as of the Petition Date, approximately
$82 million of general unsecured debt was outstanding, comprised
primarily of trade claims, obligations related to REC and ACP
obligations, and broker commission payments.
The following classes shall be treated as follows:
* Class 1B Allowed Prepetition BP Secured Claim. This class is
impaired with estimated amount of allowed claim of $128,222,666 and
may recover 72% to 85% of said claim. Each holder of an Allowed
Prepetition BP Secured Claim shall receive on the Effective Date,
or as soon as reasonably practicable thereafter, all of the
following, but not including cash in an amount necessary to pay or
reserve for the Confirmation Amount: the return of proceeds from
the sale of the Prepetition Collateral and any Prepetition
Collateral, including, among other things, the Posted Collateral,
subject to Other Secured Claims.
* Class 2 Allowed General Unsecured Claims. This class is
impaired with estimated amount of allowed claim of $21,700,000 to
$161,000,000 and may recover 1% to 16% of said claims. Each holder
of an Allowed General Unsecured Claim will receive one or more
Distributions equal to its pro rata share of the General Unsecured
Creditor Interests as such Distributions become available as is
reasonably practicable in the reasonable discretion of the
Liquidation Trustee.
* Class 3 Allowed BP Deficiency Claim and Allowed BP
Subordinated Claim. This class is impaired with estimated amount
of allowed claim of $36,500,000 to $52,400,000 and may not recover.
Each holder of an Allowed BP Deficiency Claim and Allowed BP
Subordinated Claim will receive its pro rata share of the proceeds
of the Subordinated Creditor Fund as such funds become available as
is reasonably practicable in the reasonable discretion of the
Liquidation Trustee.
* Class 4 Allowed Prepetition CBLIC Claims. This class is
impaired with estimated amount of allowed claim of $35,699,288 to
$36,761,160 and may not recover. Upon the consent of the holder(s)
of the Prepetition CBLIC Claims, such Prepetition CBLIC Claims
shall be deemed subordinated to the Class 2 General Unsecured
Claims pursuant to Bankruptcy Code section 510(c) or
recharacterized as equity, and any liens purportedly securing such
Claims shall be released on the Effective Date. Absent the consent
of the holder(s) of the Prepetition CLBIC Claims, the Debtors, BP,
and the Committee (or after the Effective Date, the Liquidation
Trustee) shall cooperate in seeking subordination or
recharacterization of such claims.
* Class 5 Interest. This class is impaired. No holder of an
interest will be entitled to a distribution under the Plan on
account of such Interest. On the Effective Date, all interests
will be retired, cancelled, extinguished, and/or discharged.
The DIP Financing Claims are allowed in full. All Allowed DIP
Financing Claims shall be paid in full, in Cash on the Effective
Date or as soon thereafter as reasonably practicable.
The Plan shall be funded from the Effective Date Cash and any other
Assets of the Estates.
A full-text copy of the Disclosure Statement dated May 9, 2020, is
available at https://tinyurl.com/ybnne8uj from PacerMonitor.com at
no charge.
Counsel to the Debtors:
Timothy W. Walsh
Darren Azman
Ravi Vohra
Natalie Rowles
MCDERMOTT WILL & EMERY LLP
340 Madison Avenue
New York, New York 10173
Telephone: (212) 547-5615
Facsimile: (212) 547-5444
About Agera Energy
Headquartered in Briarcliff Manor, N.Y., and established in 2014,
Agera Energy -- http://www.ageraenergy.com/-- is a retail energy
supplier offering a one-stop-shop for energy supply, efficiency and
audit services. Serving a national footprint of customers, the
company supplies residential and business customers, ranging from
the smallest apartments to the largest industrial users, with
electricity and natural gas. With best-in-class energy solutions,
Agera Energy focuses on its customers so they can focus on their
homes and businesses.
Agera Energy LLC and five subsidiaries sought Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 19-23802) on Oct. 4, 2019, in White
Plains, N.Y. Agera Energy was estimated to have $50 million to
$100 million in assets and $100 million to $500 million in
liabilities as of the bankruptcy filing.
The Hon. Robert D. Drain oversees the cases.
The Debtors tapped McDermott Will & Emery LLP as counsel; Stifel,
Nicolaus & Co., Inc. and Miller Buckfire & Co., LLC as an
investment banker; and GlassRatner Advisory & Capital Group, LLC as
financial advisor. Stretto is the claims agent.
The U.S. Trustee for Region 2 appointed creditors to serve on the
official committee of unsecured creditors on Oct. 11, 2019.
AH TWO: Voluntary Chapter 11 Case Summary
-----------------------------------------
Debtor: Ah Two, LLC
Hayden, ID 83835
Business Description: Ah Two, LLC previously sought bankruptcy
protection on May 16, 2013 (Bankr. D. Id.
Case No. 13-20518).
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
District of Idaho
Case No.: 20-20297
Debtor's Counsel: Kevin Holt, Esq.
HOLT LAW OFFICE, PLLC
233 E. Harrison Ave.
Coeur d'Alene
Tel: 208-664-5011
E-mail: kholt@holtlawoffice.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Ronald J. Ayers, managing member.
The Debtor did not file together with the petition a list of its 20
largest unsecured creditors at the time of the filing.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/k0d4Hb
AIR CANADA: Moody's Cuts CFR to Ba2 & Sr. Unsec. Rating to Ba3
--------------------------------------------------------------
Moody's Investors Service has downgraded Air Canada's Corporate
Family Rating to Ba2 from Ba1, Probability of Default rating to
Ba2-PD from Ba1-PD, first lien senior secured rating to Ba1 from
Baa3, senior unsecured notes rating to Ba3 from Ba2 and Speculative
Grade Liquidity rating to SGL-3 from SGL-2. Moody's also downgraded
its ratings on each of the company's enhanced equipment trust
certificates by one notch, in line with the one notch downgrade of
the corporate family rating.
This rating action concludes the review process initiated on March
18, 2020.
The spread of the coronavirus outbreak, the deteriorating global
economic outlook, low oil prices, and asset price declines are
sustaining a severe and extensive credit shock across many sectors,
regions and markets. The combined credit effects of these
developments are unprecedented. The passenger airline industry is
one of the sectors most significantly affected by the shock given
its exposure to travel restrictions and sensitivity to consumer
demand and sentiment. Moody's regards the coronavirus outbreak as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Its downgrade of Air
Canada's ratings balances the company's adequate liquidity against
the breadth and severity of the coronavirus shock and the uncertain
trend in passenger demand that will extend well into 2021.
Outlook Actions:
Issuer: Air Canada
Outlook, Changed To Negative From Rating Under Review
Issuer: Air Canada 2013-1 Pass Through Trusts
Outlook, Changed To Negative From Rating Under Review
Issuer: Air Canada Series 2015-2 Pass Through Trusts
Outlook, Changed To Negative From Rating Under Review
Issuer: Air Canada Series 2017-1 Pass Through Trusts
Outlook, Changed To Negative From Rating Under Review
Issuer: Air Canada Series 2020-1 Pass Through Trusts
Outlook, Changed To Negative From Rating Under Review
Downgrades:
Issuer: Air Canada
Corporate Family Rating, Downgraded to Ba2 from Ba1
Probability of Default Rating, Downgraded to Ba2-PD from Ba1-PD
Speculative Grade Liquidity Rating, Downgraded to SGL-3 from SGL-2
Senior Secured 1st Lien Revolving Credit Facility, Downgraded to
Ba1 (LGD2) from Baa3 (LGD2)
Senior Secured 1st Lien Term Loan B, Downgraded to Ba1 (LGD2) from
Baa3 (LGD2)
Senior Secured 1st Lien Global Notes, Downgraded to Ba1 (LGD2) from
Baa3 (LGD2)
Gtd Senior Unsecured Global Notes, Downgraded to Ba3 (LGD5) from
Ba2 (LGD5)
Downgrades:
Issuer: Air Canada 2013-1 Pass Through Trusts
Senior Secured Enhanced Equipment Trust Class A, Downgraded to Baa3
from Baa2
Senior Secured Enhanced Equipment Trust Class B, Downgraded to Ba3
from Ba2
Issuer: Air Canada Series 2015-2 Pass Through Trusts
Senior Secured Enhanced Equipment Trust Class AA, Downgraded to A2
from A1
Senior Secured Enhanced Equipment Trust Class A, Downgraded to Baa1
from A3
Senior Secured Enhanced Equipment Trust Class B, Downgraded to Baa3
from Baa2
Issuer: Air Canada Series 2017-1 Pass Through Trusts
Senior Secured Enhanced Equipment Trust Class AA, Downgraded to A2
from A1
Senior Secured Enhanced Equipment Trust Class A, Downgraded to Baa1
from A3
Senior Secured Enhanced Equipment Trust Class B, Downgraded to Baa3
from Baa2
Issuer: Air Canada Series 2020-1 Pass Through Trusts
Senior Secured Enhanced Equipment Trust Class C, Downgraded to Ba2
from Ba1
RATINGS RATIONALE
Air Canada's (Ba2 negative) credit benefits from its leading
position in the duopolistic Canadian market, falling fuel costs and
liquidity Moody's deems supportive through this difficult market.
It is constrained by the severe drop in passenger demand and
uncertainty regarding the length and impact of current market
conditions.
The rating action reflects the almost complete grounding of the
company's fleet in the second quarter of 2020, and the expectation
that passengers' return to air travel is likely to be slow. Moody's
expects the coronavirus pandemic to significantly curtail Canadian
domestic and global demand for air travel well into 2021. Air
Canada's capacity will be 85 to 90% lower in Q2/20 (compared to the
previous year) and about 75% lower in Q3, with an assumption that
it will take at least three years to recover to 2019 levels of
revenue and capacity. As well, Air Canada is planning to retire 79
aircraft over the next few years, including 14 E190s immediately
(which are being replaced with the A220). The company said their
cash burn was CAD22 million per day in March due to the sudden
decline in demand and higher refund activity. Expected cash burn
through the remainder of 2020 is expected to improve relative to
what was reported in March but will still be high. These conditions
will lead to significant cash consumption in 2020, weaken Air
Canada's liquidity profile and increase leverage. The risk of a
more challenging downside scenario remains high and the severity
and duration of the pandemic and travel restrictions also remain
highly uncertain, particularly given the threat of an increase in
the number of infections as social distancing practices ease.
Air Canada is currently focusing on managing its way through this
very volatile market environment by reducing costs as much as
possible and by shoring up its liquidity profile. The company is
targeting a CAD1.05 billion reduction in costs and capex for the
year (65% capex / 35% operating costs). As well, Air Canada
believes that, excluding fuel and depreciation and amortization
expenses, approximately 50 percent of its operating expenses are
variable in nature and has no current outstanding fuel hedge
positions.
The airline sector currently accounts for about 2% of global carbon
emissions with 65% of its emissions coming from international
flights. Canada (and as a result Air Canada) is one of the 70
countries that have voluntarily elected to early adopt the
International Civil Aviation Organization's Carbon Offsetting and
Reduction Scheme for International Aviation (CORSIA), which targets
capping carbon emissions at 2020 levels and requires purchases of
offsets for airlines' that exceed their targets.
Air Canada has adequate liquidity, supported by CAD9.1 billion of
sources against CAD6.3 billion of uses. The company's sources are
1) CAD6.1 billion of cash and short-term investments at March 31,
2020, 2) US$600 (CAD829 equiv.) million received from a 364-day
term loan secured by aircraft and spare engine that was concluded
in April, 3)CAD788 million from bridge financing also concluded in
April for 18 Airbus A220 aircraft which may be used for general
corporate purposes and which Air Canada expects to replace with
longer-term secured financing arrangements later in 2020 with the
same lender, 4) Air Canada's May 26th announcement that it has
commenced a marketed public offering of shares for gross proceeds
of approximately CAD500 million, 5) a concurrent marketed private
placement of convertible senior unsecured notes for gross proceeds
of US$400 million and 6) about US$300 million from its Series
2020-1 Class C EETC issued on March 27th. Air Canada's unencumbered
asset pool (excluding the value of Aeroplan and Air Canada
Vacations) amounts to approximately $2.6 billion as of March 31,
2020.
Uses include 1) its expectation of approximately CAD2.2 billion of
negative free cash flow through the next four quarters, 2)
mandatory debt and lease repayments (including repayments of the
two April bridge financings) of about CAD2.8 billion over the next
4 quarters and 3) minimum cash reserves required by Air Canada's
contractual covenants which Moody's estimates to be about CAD1.3
billion.
Air Canada has debt covenants, which are loan-to-security value
measures in nature, which Moody's expects the company will remain
in compliance with.
The negative outlook reflects risks of more challenging downside
scenarios and that the timing of passenger's return to air travel
is uncertain and could be slower than Moody's currently expects.
The negative outlook also reflects the expected cash burn of Air
Canada and potential that liquidity usage could be in excess of
expectations.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if Moody's believes the impacts of
the coronavirus will lead to a steeper and longer decline in
passenger demand and weaker credit metrics. This would include
expectations that Air Canada will not be able to restore its
financial profile once the virus recedes, including debt-to-EBITDA
below 4x and funds from operations plus interest-to-interest
sustained above 4x.
There will be no upwards pressure on ratings until after passenger
demand returns to pre-coronavirus levels, and key credit metrics
improve, with debt-to-EBITDA towards 3x and funds from operations
plus interest-to-interest above 6x.
Moody's rates nine tranches of enhanced equipment trust
certificates across four Air Canada EETC transactions, Series
2013-1, Series 2015-2, Series 2017-1 and Series 2020-1. The
downgrades maintain the notching of each tranche relative to the
corporate family rating. Moody's believes the aircraft models that
comprise the collateral of each transaction will remain important
to Air Canada's network, once the coronavirus recedes. The
respective loan-to-value of each tranche supports the respective
rating assignments.
The 2013-1 transaction is secured by five 777-300ERs. The 2015-2
transaction is secured by two 777-300ERs and three 787-9s. The
2017-1 transaction is secured by nine 737 MAX 8s and four 787-9s.
Moody's anticipates that the 737 MAX will return to service in a
timeframe that will not lead to undue pressure on its market value.
The Series 2020-1 issued on May 27th has only a Class C tranche and
is secured by the 27 aircraft across the company's Series 2015-1
(unrated), 2015-2 and 2017-1 EETCs.
Changes in EETC ratings can result from any combination of changes
in the underlying credit quality or ratings of the company, Moody's
opinion of the importance of the aircraft collateral to the
operations and/or its estimates of current and projected aircraft
market values, which will affect estimates of loan-to-value.
Near-term updates to Moody's estimates of aircraft market values
that reduce the respective equity cushion could lead to further
downgrades.
The principal methodology used in rating Air Canada was Passenger
Airline Industry published in April 2018.
Air Canada is the largest provider of scheduled airline passenger
services within, and to and from Canada. Revenue in 2019 was
CAD19.1 billion. The company is headquartered in Saint-Laurent,
Quebec, Canada.
AKORN INC: In Chapter 11 for Sale; Lenders to Open Bidding
-----------------------------------------------------------
Akorn, Inc. and its U.S. subsidiaries filed for voluntary
protection under Chapter 11 of the U.S. Bankruptcy Code in United
States Bankruptcy Court for the District of Delaware to execute an
in‑court sale of its business while addressing litigation-related
overhangs and best positioning the business for long-term success
under new ownership. In connection with the filing, the Company
has executed a Restructuring Support Agreement with lenders
representing more than 75% of its secured debt, who will
collectively serve as a "stalking horse" bidder in the Company's
sale process and provide additional liquidity to fund the Company's
business operations during this process.
In accordance with the Company's previously announced sale process,
Akorn will use the legal protections of the Chapter 11 process to
execute a sale of its business in accordance with the milestones
set forth in the Restructuring Support Agreement. As a result of
negotiations, Akorn and certain of its existing lenders have agreed
to a Stalking Horse Asset Purchase Agreement ("Stalking Horse APA")
whereby the existing lenders will serve as the "stalking horse"
bidder in the court-supervised sale of the business, which will be
subject to further marketing during the Chapter 11 process in
accordance with the Company's proposed bid procedures. Other buyers
will continue to have the opportunity to improve on this bid for
the Company.
To help fund and protect its operations during the Chapter 11
process, Akorn obtained consent to use cash collateral from all of
its existing lenders and received commitments from certain of its
lenders for $30 million in debtor-in-possession ("DIP") financing.
Upon approval of the Bankruptcy Court, the DIP financing will
provide the Company and its U.S. subsidiaries with ample liquidity
to fund their business operations and administrative expenses
during the Chapter 11 cases.
Akorn is confident in the underlying strength of its business and
plans to continue to operate as usual throughout the duration of
the Chapter 11 and sale process, including meeting its contractual
obligations and making payments to vendors. The Company has filed
customary motions with the Bankruptcy Court intended to allow Akorn
to maintain normal operations and fulfill its go-forward
commitments to customers, suppliers, associates and other
stakeholders. These motions are typical in the Chapter 11 process
and Akorn anticipates they will be heard and approved in the first
few days of the case.
Doug Boothe, Akorn's President and Chief Executive Officer,
commented, "Today's announcement represents a decisive, positive
step for Akorn, one that we have been able to achieve because of
the underlying strength of our business and potential for growth.
We look forward to separating legacy litigation and debt from the
Company's most valuable assets – our products, our people, our
manufacturing facilities and our knowledge – so that we can move
forward unencumbered by these liability exposures under new
ownership that believes in our future."
"The current public health crisis has re-emphasized that the work
our associates do tirelessly each and every day is vital to those
we serve. I anticipate that today's decisive action will allow us
to be better positioned to continue this work for many years to
come."
The Chapter 11 cases include Akorn and each of its U.S.
subsidiaries. The Company's entities in India and Switzerland are
not included in the Chapter 11 filing.
The Company is working to complete the sale process in the third
quarter of 2020 and emerge as a more vibrant company, even better
positioned to improve patients' lives through the quality,
availability and affordability of its products.
About Akorn, Inc.
Akorn, Inc. (Nasdaq: AKRX) -- http://www.akorn.com/-- 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.
Akorn, Inc., and its affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 20-11178) on May 20, 2020.
As of March 31, 2020, the Debtors disclosed total assets of
$1,032,275,000 and total liabilities of $1,051,769,000.
The cases are assigned to Judge John T. Dorsey.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as their general bankruptcy counsel. Richards,
Layton & Finger, P.A., is the Debtors' local counsel.
AlixPartners, LLP, serves as the Debtors' restructuring advisor,
and PJT Partners LP is the financial advisor and investment banker.
Kurtzman Carson Consultants, LLC, is the notice and claims agent.
ALL FAMILY FINANCE: June 8 Hearing on Disclosure Statement
----------------------------------------------------------
The Court will hold a hearing on the Disclosure Statement of All
Family Finance, LLC, on the 8th day of June 2020 at 2:00 p.m.,
Courtroom 1202, United States Courthouse, 75 Ted Turner Drive, SW,
Atlanta, Georgia 30303.
All Family Finance, LLC submitted a Disclosure Statement.
As of March 31, 2020, the Debtor's Estate consists of
(i) cash in the approximate amount of $181,742 as of March 31,
2020;
(ii) the portfolio of RISC receivables with a loan value of
$2,396,448 as of March 31, 2020 (the "AFF Receivables"),
(iii) 98 vehicles repossessed or otherwise recovered by the Debtor
and not subject to a floor-plan agreement with CFG (the "AFF
Vehicles") with a likely recoverable value of $100,000;
(iv) claims against MCC, as principal obligor, for repayment of
$825,000 already paid by the Debtor to CFG on account of its
Guaranty, plus an additional $50,000 payment to be paid on or
around April 17, 2020, plus all additional amounts to be paid to
CFG from the Debtor's assets under the Plan;
(v) claims against Ms. Nadal and Guillermo (William) Nadal for
contribution as guarantors of the CFG debt; and
(vi) potential claims consisting of the "Retained Actions".
The Plan contemplates the establishment of a Post Confirmation
Trust consisting of all assets of the Debtor, with the existing CRO
acting as Plan Administrator. The Plan contemplates that CFG will
be paid monthly 80% of net cash flow (all gross receipts less
operating expenses, professional fees, and United States Trustee
fees) of AFF Receivables (which includes insurance payments and
proceeds from repossessed vehicles (other than proceeds from the
AFF Vehicles), with the remaining 20% being available for the
Unsecured Creditor Group. The Plan further contemplates that the
AFF Vehicles will be liquidated for the benefit of the Unsecured
Creditor Group. The Plan further provides for the execution of a
note from MCC to the Debtor for repayment of the amounts the Debtor
has and will continue to pay CFG. If the projections hold, the
recovery to the Unsecured Creditor Group will be approximately
37.6% of the outstanding principal value of the current debt over a
period ending Dec. 31, 2024.
The Plan treats claims as follows:
* Class 1 (CFG). Class 1 consists of the Allowed Secured Claim
of CFG. This class is impaired with a total claim of $1,546,332.51.
The Allowed CFG Class 1 Secured Claim will be paid at the rate of
80% of all prior month net cash flow (i.e. all gross receipts less
operating expenses, professional fees and U.S. Trustee fees)
(“Prior Month Net Cash Flow”) commencing on the 15th day of the
first full month following the Confirmation Order (or the next
Business Day if the 15th day does not fall on a Business Day) and
continuing by the 15th day of each subsequent month until the Class
1 Secured Claim is paid in full.
* Class 2A (Convenience Claim Creditors). Class 2A consists of
the Holders of Convenience Claims, which are defined as General
Unsecured Claims against the Debtor for which each Holder is owed
$2,000 or less. This class is impaired. The Holders of Convenience
Claims shall receive Distributions totaling thirty seven and six
tenths percent (37.6%) of each Holder’s Allowed Class 2A Claim
payable on the Effective Date. The known asserted Class 2A Claims
are: James Demchak ($1,037.33) and Leslie Nicola (POC No. 25-
$1,214.37).
* Class 2B (General Unsecured Creditors). Class 2B consists of
General Unsecured Claims held by the Unsecured Creditor Group, but
specifically excluding any Class 2B General Unsecured Claim held by
MCC and the Holders of Class 2A Convenience Claims. This class is
impaired. Commencing on the Effective Date, the Plan Administrator
will escrow for the benefit of the Class 2B Creditors twenty
percent (20%) of the Prior Month Net Cash Flow (as defined in Class
1 of the Plan). Each Holder of a Class 2B General Unsecured Claim
will be paid monthly a Pro Rata share of the available: (i)
proceeds from the sale of the AFF Vehicles, (ii) the escrowed
twenty percent (20%) of the Prior Month Net Cash Flow, and (iii)
collections from the MCC Note. The Plan Administrator will pay make
such pro-rata payment based upon the Allowed Claims of the Class 2B
General Unsecured Claims.
* Class 3 (Interest Holder). Upon the Effective Date: (i) the
Board Member will be deemed to have resigned, (ii) the Debtor will
be deemed dissolved for all purposes without the necessity for any
further actions to be taken by or on behalf of the Debtor other
than as set forth herein; (iii) any and all membership interests in
Debtor will be deemed terminated and extinguished; and (iv) the
Debtor will have no further duties or responsibilities in
connection with implementation of the Plan.
A full-text copy of the Disclosure Statement dated May 6, 2020, is
available at https://tinyurl.com/y8o6r5us from PacerMonitor.com at
no charge.
Attorney for the Debtor:
Cameron M. McCord
JONES & WALDEN, LLC
699 Piedmont Avenue
Atlanta, Georgia 30308
Tel: (404) 564-9300
Attorney for the Official Committee of Unsecured Creditors:
G. Frank Nason, IV
LAMBERTH, CIFELLI,
ELLIS & NASON, P.A.
6000 Lake Forrest Drive, Suite 435
Atlanta, Georgia 30328
Tel: (404) 262-7373
About All Family Finance
All Family Finance, LLC is a private finance company that provides
loans for automobiles. As its business, All Family Finance
collects sub-prime loans acquired from "Buy Here, Pay Here" car
lots with its offices located at 124 Powers Ferry Road, Suite K,
Marietta, Ga. The business is generating approximately $150,000 in
revenues per month.
Alleged creditors filed an involuntary Chapter 11 petition for All
Family Finance on Aug. 9, 2019 (Bankr. N.D. Ga. Case No.
19-62597).
G. Frank Nason, IV, Esq., at Lamberth, Cifelli, Ellis & Nason,
P.A., serves as counsel to Alice Gipson and Jeff Hurd and other
alleged creditors.
On Sept. 11, 2019, the court entered an order for relief under
Chapter 11 of the Bankruptcy Code. No trustee has been appointed,
and All Family continues to operate its business and manage its
affairs as debtor-in-possession.
The Debtor's attorney is Cameron M. McCord, Esq., at Jones &
Walden, LLC. Mr. Mark A. Smith of Vantage Point Advisory, Inc., is
the chief restructuring officer.
The U.S. Trustee for Region 21 appointed a committee of unsecured
creditors on Oct. 2, 2019. The Committee tapped Lamberth, Cifelli,
Ellis & Nason, P.A., as counsel.
ALLEGIANT TRAVEL: Moody's Confirms Ba3 Corp. Family Rating
----------------------------------------------------------
Moody's Investors Service confirmed its ratings for Allegiant
Travel Company; Ba3 corporate family rating, Ba3-PD probability of
default rating, and Ba3 senior secured debt ratings. The ratings
outlook is negative. These actions conclude the review for
downgrade of Allegiant's ratings that was initiated on March 17,
2020.
The spread of the coronavirus pandemic, the weakened global
economic outlook, low oil prices, and asset price declines are
sustaining a severe and extensive credit shock across many sectors,
regions and markets. The combined credit effects of these
developments are unprecedented. The passenger airline industry is
one of the sectors most significantly affected by the shock given
its exposure to travel restrictions and sensitivity to consumer
demand and sentiment. Moody's regards the coronavirus pandemic as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Its ratings
confirmations balance Allegiant's adequate liquidity against the
breadth and severity of the coronavirus' shock and the uncertain
trends in passenger demand that will persist in upcoming years.
Moody's expects Allegiant's domestic network focused on leisure
travel to experience a faster recovery in demand as compared to the
more diversified passenger mix, including business travelers, of
its larger US industry peers and those with significant
international operations.
The coronavirus pandemic will continue to significantly curtail US
domestic and global demand for air travel for an extended period.
Moody's assumed that Allegiant's Q4 2020 capacity would be down
about 20% versus Q4 2019 in its faster recovery model and about 70%
in its slower recovery model. In all scenarios, the reduction in
passenger demand is greater than the reduction in capacity, leading
to meaningfully lower load factors. These scenarios also assume
that passenger demand and operating margins substantially increase
towards 2019 levels in 2023. Allegiant has been the most profitable
US airline based on average operating profit margins during the
last seven years through 2019. Its average operating profit margin
of 20% is about 350 basis points higher than that of runner-up
Hawaiian Airlines. The risk of more challenging downside scenarios
remains high, and the severity and duration of the pandemic and
travel restrictions remain highly uncertain, particularly given the
threat of an increase in the number of infections as social
distancing practices across the US become less stringent in
upcoming weeks and beyond.
The negative outlook reflects the potential for greater than
already anticipated adverse impact from the coronavirus crisis,
which would consume more of the company's liquidity and delay the
pace and scope of the recovery in demand and Allegiant's credit
profile versus Moody's current expectations. Nonetheless, adequate
liquidity and a domestic, leisure focused network currently
mitigates the adverse impact of the coronavirus crisis on
Allegiant's credit profile.
LIQUIDITY
Cash and short-term investments totaled $517 million on April 30th.
The $81 million revolving credit facility due in March 2021 is
fully drawn. Allegiant will receive $172 million under the Payroll
Support Program of the US Coronavirus Aid, Relief, and Economic
Security Act. Of this amount, $22 million will be a 10-year,
unsecured loan. A CARES Act secured loan of $276 million will also
be available to Allegiant through September 30, 2020, should it
decide to utilize this part of the program. Unsecured assets --
mostly A320 family aircraft and engines -- with value of about $400
million remain available for additional financing, if needed.
RATINGS RATIONALE
The Ba3 corporate family rating reflects the financial benefits of
Allegiant's differentiated airline model that provides limited
competition across about 70% or more of its route system in normal
times. Moody's expects Allegiant to continue to achieve one of the
strongest operating margins of the 22 airlines it rates following
the taming of the coronavirus. The re-making of the fleet required
an $800+ million debt-funded investment for mostly used Airbus
aircraft. Debt-to-EBITDA remained below 3.5x during the investment
period and was 2.7x at the end of 2019. Holding the Ba3 corporate
family rating at this time considers Moody's estimate that the
company's liquidity can cover its obligations for an extended
period and the expectation that the company will retire debt from
free cash flow following the coronavirus. Mothballing the
construction of the planned Sunseeker resort in Port Charlotte,
Florida will also allay liquidity pressure, freeing up
post-coronavirus free cash flow from the airline operations for
debt reduction.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The corporate family rating could be downgraded if Moody's believes
the coronavirus will constrain passenger demand for an extended
period and or credit metrics. Downward ratings pressure would
result from (i) a slower than expected pace of recovery as a result
of the coronavirus outbreak, particularly if not matched by further
additional sources of liquidity; (ii) greater liquidity pressure
from an inability to remove costs and cut capital spending; and/or
(iii) if there are clear expectations that Allegiant will not be
able to timely restore its financial profile once the virus recedes
(for example, if debt-to-EBITDA is sustained above 3.75x, funds
from operations plus interest-to-interest falls below 4x, EBIT
margins contract and approach 12%, or free cash flow from the
airline operations falls below $100 million).
There will be no upwards pressure on the rating until after
passenger demand returns to pre-coronavirus levels, Allegiant
maintains liquidity above $400 million and key credit metrics
improve such that EBIT margins exceed 15%, debt-to-EBITDA drops
below 3x and funds from operations + interest-to-interest is
sustained above 5.5x.
The principal methodology used in these ratings was Passenger
Airline Industry published in April 2018.
LIST OF AFFECTED RATINGS:
Confirmations:
Issuer: Allegiant Travel Company
Corporate Family Rating, Confirmed at Ba3
Probability of Default Rating, Confirmed at Ba3-PD
Senior Secured Bank Credit Facility, Confirmed at Ba3 (LGD3, from
LGD4)
Outlook Actions:
Issuer: Allegiant Travel Company
Outlook, Changed to Negative from Ratings Under Review
Allegiant Travel Company, headquartered in Las Vegas, Nevada, is a
publicly traded (NASDAQ: ALGT) operator of a low-cost passenger
airline marketed to leisure travelers in small cities, selling air
travel, hotel rooms, rental cars and other travel related services
on a stand-alone or bundled basis. In addition, the company offers
fixed-fee flying arrangements, and generates a small portion of
revenues through third-party aircraft and engine leasing. In 2019,
Allegiant operated more than 450 routes across the US and served
almost 15 million scheduled passengers, facing no competition on
about 75% of its routes. The company generated revenues of
approximately $1.84 billion in 2019.
AMERICAN AIRLINES: Moody's Cuts CFR to B2 & Unsec. Ratings to Caa1
------------------------------------------------------------------
Moody's Investors Service downgraded all of its ratings of American
Airlines Group Inc., including those assigned to subsidiary
American Airlines, Inc.; corporate family rating to B2 from Ba3,
probability of default rating to B2-PD from Ba3-PD, senior
unsecured debt ratings to Caa1 from B1, and senior secured debt
ratings to Ba3 from Ba1. Moody's also downgraded each of its
ratings on the company's Enhanced Equipment Trust Certificates, and
the company's speculative grade liquidity rating to SGL-3 from
SGL-2. The ratings outlook is negative. These rating actions
conclude the review for downgrade initiated on March 17, 2020.
The downgrade of the senior unsecured rating by three notches
versus the two-notch decline in the corporate family rating
reflects the increasing proportion of senior secured obligations in
the company's capital structure, which diminishes the value
available to unsecured claims in the application of Moody's Loss
Given Default rating methodology.
The spread of the coronavirus pandemic, the weakened global
economic outlook, low oil prices and asset price declines are
sustaining a severe and extensive credit shock across many sectors,
regions and markets. The combined credit effects of these
developments are unprecedented. The passenger airline industry is
one of the sectors most significantly affected by the shock given
its exposure to travel restrictions and sensitivity to consumer
demand and sentiment. Moody's regards the coronavirus pandemic as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Its downgrades reflect
American's more modest liquidity coverage relative to its daily
cash burn rate and the breadth and severity of the coronavirus
shock and uncertain trends in passenger demand that will persist in
upcoming years. American will experience a faster recovery in its
aggregate demand relative to peers Delta and United as its
international revenue represented about 26% of passenger revenue in
2019, a meaningfully lower level than the other two.
Its rating actions reflect that the coronavirus pandemic will
continue to significantly curtail US domestic and global demand for
air travel for an extended period. Moody's assumed that American's
Q4 2020 capacity would be down about 50% versus Q4 2019 in its
faster recovery model and about 70% in its slower recovery model.
These scenarios also assume that passenger demand substantially
increases towards 2019 levels in 2023. American has sustained the
weakest operating margins of the rated US airlines for several
years. Nonetheless, it too should realize improved operating
margins by 2023 with learnings from managing costs and gaining
efficiencies while managing the operations through the pandemic. In
all scenarios, the reduction in passenger demand is greater than
the reduction in capacity, leading to meaningfully lower load
factors. The risk of more challenging downside scenarios remains
high, and the severity and duration of the pandemic and travel
restrictions remain highly uncertain, particularly given the threat
of an increase in the number of infections as social distancing
practices across the US and other countries become less stringent
in upcoming weeks and beyond.
The negative outlook reflects the potential for greater than
already anticipated adverse impact from the coronavirus crisis,
which would consume more of the company's liquidity and delay the
pace and scope of the recovery in demand, the retirement of debt,
and the strengthening of credit metrics relative to Moody's current
expectations.
LIQUIDITY
Cash and short-term investments totaled $6.8 billion on March 31st.
In early April, American drew about $2.8 billion on its about $3.2
billion of revolvers that expire in October 2024. In March, the
company arranged a $1 billion 364-day facility that comes due in
March 2021. It has otherwise refrained from raising other debt.
American will receive $5.8 billion under the Payroll Support
Program of the US Coronavirus Aid, Relief, and Economic Security
Act. Of this amount, $1.73 billion will be a 10-year, unsecured
loan. A CARES Act secured loan of $4.75 billion will also be
available to American through September 30, 2020. Moody's believes
American will draw the loan given it has so far refrained from
raising other significant amounts of debt capital or equity.
Unsecured assets with estimated value of about $10 billion --
excluding the AAdvantage loyalty program -- remain available for
additional financing, as does a forward sale of loyalty program
miles, if needed.
A commitment by the US airlines to return on capital and profit
maximization rather than market share strategies, declines in
unemployment rates, and passenger demand and oil price levels will
be key determinants of American's future cash generation that will
inform the potential pace of deleveraging the capital structure.
American spent $9.4 billion on fuel and invested $4.3 billion on
capital expenditures and returned $1.3 billion to shareholders in
2019. With the CARES Act prohibition on returns to shareholders for
one year after the repayment of loans, potentially significant
reductions in capital expenditures and likely materially lower fuel
prices, there is the potential for American to sequentially and
cumulatively retire a significant amount of the debt incurred in
2020 because of the coronavirus, as demand recovers through 2023.
RATINGS RATIONALE
American's B2 corporate family rating reflects its scale and
competitive position as the world's second largest airline based on
revenue, with a strong trans-Atlantic franchise through its
partnership with British Airways. Elevated financial leverage
coming into 2020 and the related relatively higher debt service
obligations, a larger employee base that increases daily cash burn
relative to its similarly-sized US peers (based on revenues) and
more modest liquidity balance the strong business profile.
Financial leverage has been elevated because of a historically
aggressive financial policy defined by debt-funding of the largest
amount of share repurchases by a US airline since 2013 while
conducting a multi-year fleet renewal program through 2019.
Notwithstanding its size, American has sustained an inferior
operating margin relative to the industry, which has limited its
free cash flow and pressures the company's ratings.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if Moody's believes the impacts of
the coronavirus will lead to a steeper and longer decline in
passenger demand and weaker credit metrics. Expectations of cash
and revolver availability falling below $5 billion; no noticeable
increase in passenger bookings or revenue passenger miles in
upcoming months; no meaningful decrease in daily cash burn in the
third or fourth quarter of 2020 under a scenario where there is no
increase in passenger demand relative to Q2 2020 levels; or that
American will not be able to timely restore its financial profile
once the virus recedes (for example, if debt-to-EBITDA is sustained
above 6x or funds from operations plus interest-to-interest falls
towards 3x could lead to further rating downgrades.
There will be no upwards pressure on the ratings until after
passenger demand returns to pre-coronavirus levels, American
maintains liquidity above $7 billion and key credit metrics
improve, including EBITDA margins above 14%, debt-to-EBITDA
approaching 4.5x and funds from operations plus
interest-to-interest is above 3.5x.
Ratings on corporate (non-EETC) debt instruments could further
change with no change in the corporate family rating because of
changes in the relative contribution of senior secured and senior
unsecured obligations in Moody's Loss Given Default waterfall. For
example, the $1.74 billion loan portion of the CARES Act Payroll
Support Payments is an unsecured obligation; the $4.75 billion
CARES Act loan will be secured. The previously arranged $1 billion
of 364-day facilities and drawing of the revolvers also increased
the amount of secured claims in the LGD waterfall. Adding either
materially larger amounts of secured debt than unsecured debt or
material amounts of one but not the other can lower the ratings of
each class.
Changes in the EETC ratings can result from any combination of
changes in the underlying credit quality or ratings of the company,
Moody's opinion of the importance of the aircraft collateral to the
operations, and/or its estimates of current and projected aircraft
market values, which will affect estimates of loan-to-value and
potentially, increase the probability of a rejection of a
transaction in a bankruptcy scenario. Near-term updates to Moody's
estimates of aircraft market values that reduce the respective
equity cushion could lead to further downgrades.
LIST OF AFFECTED RATINGS
Downgrades:
Issuer: America West Airlines, Inc.
Senior Secured Enhanced Equipment Trust, Downgraded to Baa3 from
Baa2 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba2 from
Baa3 and on review for downgrade
Senior Secured Underlying Enhanced Equipment Trust, Downgraded to
Ba2 from Baa3 and on review for downgrade
Issuer: American Airlines Group Inc.
Corporate Family Rating, Downgraded to B2 from Ba3 and on review
for downgrade
Probability of Default Rating, Downgraded to B2-PD from Ba3-PD and
on review for downgrade
Speculative Grade Liquidity Rating, Downgraded to SGL-3 from SGL-2
Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1 from B1
and on review for downgrade
Issuer: American Airlines, Inc.
Senior Secured Bank Credit Facility, Downgraded to Ba3 from Ba1 and
on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to B3 from B2
and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Baa1 from A2
and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba2 from
Baa3 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Baa3 from
Baa2 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to B2 from Ba3
and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Baa1 from A2
and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba2 from
Baa3 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Baa3 from
Baa2 and on review for downgrade
Issuer: Pennsylvania Economic Dev. Fin. Auth.
Senior Unsecured Revenue Bonds, Downgraded to Caa1 from B1 and on
review for downgrade
Issuer: Phoenix Industrial Development Authority, AZ
Senior Unsecured Revenue Bonds, Downgraded to Caa1 from B1 and on
review for downgrade
Issuer: US Airways, Inc.
Senior Secured Enhanced Equipment Trust, Downgraded to Ba1 from
Baa1 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba1 from
Baa2 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba1 from
Baa3 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba2 from
Baa3 and on review for downgrade
Senior Secured Enhanced Equipment Trust, Downgraded to Ba3 from Ba1
and on review for downgrade
Senior Secured Underlying Enhanced Equipment Trust, Downgraded to
Ba1 from Baa2 and on review for downgrade
Confirmations:
Issuer: US Airways, Inc.
Senior Secured Enhanced Equipment Trust, Confirmed at Ba1 and on
review for downgrade
Outlook Actions:
Issuer: America West Airlines, Inc.
Outlook, Changed To Negative From Rating Under Review
Issuer: American Airlines Group Inc.
Outlook, Changed To Negative From Rating Under Review
Issuer: American Airlines, Inc.
Outlook, Changed To Negative From Rating Under Review
PRINCIPAL METHODOLOGY
The principal methodologies used in these ratings were Passenger
Airline Industry published in April 2018.
American Airlines Group Inc. is the holding company for American
Airlines, Inc. Together with regional partners, operating as
American Eagle, the airlines operated an average of nearly 6,800
flights per day to more than 365 destinations in 61 countries
before the coronavirus pandemic. The company reported revenue of
$45.8 billion for 2019.
AMERICAN CENTER: Engelberg Objects to Plan Disclosures
------------------------------------------------------
Michael Engelberg filed an objection to American Center for Civil
Justice, Inc.'s Fourth Modified Disclosure Statement.
Engelberg points out that it appears that there will be no
financial information regarding ACCJ's prepetition operations,
including a breakdown of revenues received in the two- or
three-year period prepetition, itemization of prepetition expenses
for each year (including payment of salaries, rent, utilities and
donations), or distributions to victims.
Engelberg further points out that with respect to postpetition
operations, ACCJ would require parties in interest to contact the
clerk of the court to obtain monthly reports to see what has been
collected and paid.
According to Engelberg, at a recent hearing, the judge inquired of
ACCJ as to whether it had entered into any new Center and Claimant
Agreements after the Petition Date. The response was a surprising
no.
Engelberg notes that the Fourth Modified Disclosure Statement
refers to a "Restructuring Transaction", but provides no discussion
of ACCJ's real intentions, i.e., whether it will merge with RLT,
whether it will dissolve, or whether both will operate as
standalone entities, and if so in what relation to each other.
Engelberg complains that whether operating after a merger with RLT,
or as a standalone entity, the projections provided by ACCJ are
woefully deficient.
Engelberg points out that a discussion of operations and
projections is also necessary because the parties to the Center and
Claimant Agreements should know how ACCJ's proceeds will be spent
in locating additional recoveries for claimants.
Engelberg further points out that although ACCJ has outlined a
discussion of future operations, it fails to include adequate
projections setting forth how its money is being spent (other than
being handed over to RLT).
Engelberg asserts that ACCJ does not disclose that the Bederson
report, which ACCJ commissioned in 2018, evaluated the RLT claim as
at most "slightly less than $12 million."
Engelberg complains that the Bederson report is out of date and
deficient, because it does not take into account the settlement by
ACCJ, at ACCJ's sole expense, of several claims for which RLT was
also liable.
According to Engelber rather than provide any analysis, ACCJ simply
asserts in its disclosure statement that payments to RLT "shall
made at such times and in such amounts as are agreed upon by the
Debtor and RLT..."
Counsel for Michael Engelberg:
NORRIS McLAUGHLIN P.A
400 Crossing Boulevard
8th Floor
P.O. Box 5933
Bridgewater, NJ 08807
Tel: 908-722-0700
Fax: 908-722-0755
Morris S. Bauer
Tel: (908) 252-44345
E-mail: msbauer@norris-law.com
About American Center for Civil Justice
American Center for Civil Justice, Inc., is a tax-exempt
organization that provides legal services. The organization
defends human and civil rights by advocating and aiding lawsuits by
victims of oppression, acts of violence and other injustices.
American Center for Civil Justice filed voluntary petitions for
relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.N.J.
Lead Case No. 18-15691) on March 23, 2018. In the petition signed
by Elie Perr, president, the company was estimated to have $10
million to $50 million in assets and liabilities. The Honorable
Christine M. Gravelle oversees the case. Timothy P. Neumann, Esq.,
of Broege, Neumann, Fischer & Shaver LLC, is the Debtors' counsel.
AMERICAN TRAILER: S&P Alters Outlook to Negative, Affirms 'B' ICR
-----------------------------------------------------------------
S&P Global Ratings affirmed its ratings, including its 'B' issuer
credit rating on Richardson, Texas-based professional- and
consumer-grade trailer manufacturer American Trailer World Corp.
(ATW), and revised its outlook to negative from stable.
S&P said, "The outlook revision reflects our view that there is a
one-in-three chance of lower ratings within the next year. The
demand environment for professional- and consumer-grade trailers
has weakened because of the COVID-19 pandemic, and there is
uncertainty regarding the pace and shape of the recovery, as well
as the risk that a resurgence in virus cases could cause a
double-dip contractionary environment later on. Because of the
anticipated weakness in ATW's second-quarter 2020 performance, we
believe the company's adjusted debt-to-EBITDA ratio could rise this
year to approach 6x. If a weak demand environment persisted and
management were unable to optimize its sales strategy and cost
structure to return its credit measures to stronger levels, then we
could lower the ratings."
COVID-19 headwinds are likely to meaningfully reduce ATW's trailer
demand in mid-2020. American Trailer World serves cyclical
end-markets, including construction, agriculture,
transportation/trucking, oil and gas, general industrial, and
recreational vehicles, among others. Some of ATW's markets will
experience more severe headwinds from a weak macroeconomic
environment than others, but, overall, S&P sees trailer volumes
declining meaningfully in the middle part of this year. A partial
mitigant is that roughly 80% of ATW's revenue is derived from
states that have more rural areas and lower-density population
centers with low COVID-19 infection rates. Many local economies are
now starting to re-open. The company has indicated that a much
lower percentage of its independent dealers remain shut down now
compared with roughly 15% in April. However, the pace of the
recovery is uncertain, and if virus cases spike again in these
areas then the economy could revert to contraction.
Operating efficiency will be key to sustaining satisfactory credit
measures. ATW experienced a roughly 70-basis-point (bps)
degradation in profit margins in 2019 and had already started to
undertake a series of activities designed to improve operational
efficiency. These included changes in management, improving the
sales organization, launching a nationwide pricing architecture,
starting to address the retail footprint, and taking actions to
improve procurement savings and labor hours per trailer. On a
year-to-date basis through February 2020 (before COVID-19), ATW saw
a 3.5% increase in sales and an almost full percentage point
increase in adjusted EBITDA margin. When the effects of the
pandemic started to be felt in earnest in March, ATW reduced its
raw material purchases, rationalized inventories, reduced retail
staffing and furloughed administrative employees, and made
adjustments to payment and collection terms. S&P believes it is
necessary for the company to remain focused on operational
execution until sustained recovery in the economy is evident; it
could then see its credit measures rebound to more appropriate
levels for the rating.
Liquidity remains sound. ATW has roughly $70 million of cash on
hand currently, with ample availability under its asset-based
lending (ABL) revolving credit facility. The company increased the
size of its ABL revolver by $50 million to $225 million on March
13, 2020, and extended the maturity to June 16, 2023. The company
drew $48 million on the facility to make a roughly $32 million
interest payment on its senior notes and to put cash on the balance
sheet for liquidity purposes. It has since repaid the ABL
borrowings down to $35 million and could reduce the ABL debt
further later this year.
S&P Global Ratings' negative outlook on ATW reflects the
one-in-three chance of lower ratings within the next year. S&P sees
the company's adjusted debt-to-EBITDA ratio rising to almost 6x in
2020 because of lower volumes and margin compression. The COVID-19
pandemic has brought about reduced demand for professional- and
consumer-grade trailers and resulted in its low-cost Mexico
production facility being temporarily shut down before re-opening
in mid-May. While the company has maintained its leading market
position, it must now focus on operational execution to keep its
adjusted debt-to-EBITDA ratio within the 5x-6x range that S&P sees
as appropriate for the ratings. The company is reducing selling
prices and costs to adjust to the demand environment and has seen
order growth start to pick back up as of late. However, S&P does
not see the rebound in order growth as being enough to offset the
destruction that has already occurred, and it also sees working
capital investments hurting cash flow generation this year. ATW
retains a number of strengths, including good relationships with
its dealers and distribution outlets, the low cost of its products
compared with its end customers' total project costs, and the
ability to obtain growth from acquisitions. However, the demand for
trailers might ebb during cyclical troughs.
S&P could lower its rating on ATW if its earnings dropped
significantly, causing total debt to EBITDA to exceed 6x without
clear prospects for recovery within one to two quarters. This could
occur if there is a re-weakening in the macroeconomic environment
and trailer sales, or if management is unable to effectively manage
its cost structure.
An unexpected large debt-financed acquisition or shareholder return
are remote possibilities during this time, but could occur in the
future; these situations could also cause credit measures to
deteriorate to that level. Based on S&P's downside scenario, this
could occur if ATW's operating margins weakened by more than 200
bps.
S&P could revise the outlook to stable if ATW's debt to EBITDA
ratio remains below 6x while it generates positive free cash flow.
This contemplates a recovery in the macroeconomic environment,
stronger end-markets, effective cost control, and adequate
liquidity.
S&P said, "Given the uncertainty in the macroeconomic environment
and our current assessment of Bain Capital's financial policies, we
view an upgrade over the next 12 months as unlikely. However, we
could raise our rating on ATW by one notch if the company
maintained debt to EBITDA of 4x-5x, funds from operations (FFO) to
debt of near 20%, and a consistently positive free cash
flow-to-debt ratio with no prospects for near-term material
deterioration." Any additional upgrades would likely depend on
whether the company could meaningfully strengthen its business risk
profile through the continued enhancement of its market position
and product offerings, as well as better pricing and operating
efficiencies."
ARCHDIOCESE OF NEW ORLEANS: Hires Donlin Recano as Claims Agent
---------------------------------------------------------------
The Roman Catholic Church of the Archdiocese of New Orleans seeks
authority from the US Bankruptcy Court for the United States
Bankruptcy Court for the Eastern District of Louisiana to employ
Donlin, Recano & Company, Inc. as its claims, noticing and
solicitation agent.
The firm will oversee the distribution of notices and the
maintenance, processing and docketing of proofs of claim filed in
the Debtor's Chapter 11 case.
The Debtor provided DRC a retainer in the amount of $30,000, and
then made a subsequent payment of $27,035.59 to cover the first
pre-petition invoice.
Nellwyn Voorhies, executive director of Donlin, disclosed in court
filings that the firm is "disinterested" within the meaning of
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Nellwyn Voorhies
Donlin, Recano & Company, Inc.
6201 15th Avenue,
Brooklyn, NY 11219
Phone: 212-481-1411
About the Archdiocese of New Orleans
The Roman Catholic Church of the Archdiocese of New Orleans --
https://www.nolacatholic.org/ -- is a non-profit religious
corporation incorporated under the laws of the State of Louisiana.
Created as a diocese in 1793, and established as an archdiocese in
1850, the Archdiocese of New Orleans has educated hundreds of
thousands in its schools, provided religious services to its
churches and provided charitable assistance to individuals in need,
including those affected by hurricanes, floods, natural disasters,
war, civil unrest, plagues, epidemics, and illness. Currently, the
Archdiocese's geographic footprint occupies over 4,200 square
miles
in southeast Louisiana and includes eight civil parishes --
Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St.
John the Baptist, St. Tammany, and Washington.
The Roman Catholic Church for the Archdiocese of New Orleans sought
Chapter 11 protection (Bankr. E.D. La. Case No. 20-10846) on May 1,
2020.
The Archdiocese was estimated to have $100 million to $500 million
in assets and liabilities as of the bankruptcy filing.
The Hon. Meredith S. Grabill is the case judge.
Jones Walker LLP, led by Mark A. Mintz, R. Patrick Vance, Elizabeth
J. Futrell, and Laura F. Ashley, serves as counsel to the Debtor.
Donlin, Recano & Company, Inc., is the claims agent.
ARMOR HOLDING: S&P Withdraws 'B-' Issuer Credit Rating
------------------------------------------------------
S&P Global Ratings is withdrawing all of its ratings on Armor
Holding II LLC, including its 'B-' issuer credit rating, at the
issuer's request. At the time of the withdrawal, S&P's outlook on
the company was stable.
ARR INVESTMENTS: June 10 Evidentiary Hearing on Disclosures
-----------------------------------------------------------
Judge Lori V. Vaughan has ordered that an evidentiary hearing of
ARR Investments, Inc. and ARR Child Care, Inc. will be held on June
10, 2020 at 2:00 p.m. in Courtroom 6C, 6th Floor, George C. Young
Courthouse, 400 West Washington Street, Orlando, Florida 32801, to
consider and rule on the disclosure statement and any objections or
modifications and to consider any other matter that may properly
come before the Court.
Objections to the proposed disclosure statement may be filed and
served at any time before or at the hearing.
About ARR Investments
ARR Investments, Inc., and its subsidiaries --
http://www.arr-learningcenters.com/-- offer learning centers for
infants, toddlers, preschoolers and Voluntary Pre-Kindergarten in
Orlando, Florida. The Learning Centers provide computer labs;
dance, yoga, music classes; aerobics; foreign language instruction;
before/after school transportation; certified lifeguard and safety
instructor for swim lessons and play; and mini-camp breaks and
summer camp.
ARR Investments and three of its subsidiaries filed voluntary
petitions seeking relief under Chapter 11 of the Bankruptcy
Code(Bankr. M.D. Fla. Lead Case No. 19-01494) on March 8, 2019.
The petitions were signed by Alejandrino Rodriguez, president. At
the time of filing, the Debtors were estimated to have under $10
million in both assets and liabilities. Jimmy D. Parrish, Esq., at
Baker & Hostetler LLP, serves as the Debtors' counsel.
ART VAN FURNITURE: Buyer to Reopen Stores as 'Loves Furniture'
--------------------------------------------------------------
Jon King, writing for whmi.com, reports that Dallas-based equity
company US Realty Acquisitions LLC acquired 27 stores of local
furniture retailer Art Van Furniture Inc.
The newly formed company, US Realty Acquisitions LLC, will be
headquartered in Royal Oak. The $6.9 million deal, which was
finalized on May 12, 2020 in U.S. Bankruptcy Court in Delaware, has
the company acquiring the assets and leases of the Art Van stores
in Michigan together with Art Van and Art Van-owned Levin Furniture
and Wolf Furniture locations in different U.S. states like
Maryland, Virginia, Ohio, Illinois and Pennsylvania.
Report from Crain's reveals that Loves Furniture is expected to
hire over 1,000 employees, including the rehiring of former Art Van
employees. It also plans to have a "soft launch" in the coming
weeks as it prepares for a grand opening event once the COVID-19
restrictions are lifted.
About Art Van Furniture
Art Van is a brick-and-mortar furniture and mattress retailer
headquartered in Warren, Michigan. The Company operates 169
locations, including 92 furniture and mattress showrooms and 77
freestanding mattress and specialty locations. The Company does
business under brand names, including Art Van Furniture, Pure
Sleep, Scott Shuptrine Interiors, Levin Furniture, Levin Mattress,
and Wolf Furniture.
The Company was founded in 1959 and was owned by its founder, Art
Van Elslander, until it was sold to funds affiliated with Thomas H.
Lee Partners, L.P. in March 2017. As part of this transaction, THL
acquired the operating assets of the Company and certain real
estate investment trusts, who closed the transaction alongside THL,
acquired the owned real estate portfolio of the Company, and
entered into long-term leases with Art Van. The proceeds from the
sale-leaseback transaction were used to fund the purchase price
paid to the selling shareholders.
Art Van Furniture, LLC, and 12 affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 20-10553) on March 8,
2020.
Art Van was estimated to have $100 million to $500 million in
assets and liabilities as of the bankruptcy filing.
The Hon. Laurie Selber Silverstein is the case judge.
The Debtors tapped Benesch, Friedlander, Coplan & Aronoff LLP as
counsel. Kurtzman Carson Consultants LLC is the claims agent.
ASSUREDPARTNERS INC: Moody's Rates New $300MM Sec. Term Loan 'B2'
-----------------------------------------------------------------
Moody's Investors Service has assigned a B2 rating to a new $300
million seven-year senior secured term loan being issued by
AssuredPartners, Inc. (corporate family rating B3). The company
will use net proceeds of the offering to repay revolving credit
borrowings, provide incremental liquidity and pay related fees and
expenses. The rating outlook for this issuer remains unchanged at
stable.
RATINGS RATIONALE
For AssuredPartners and other insurance brokers, the coronavirus
and related economic downturn will weigh on revenues, earnings and
cash flows, in Moody's view. Insurance premium volumes will be hurt
by declining insured exposures along with return premium provisions
in various commercial lines, putting downward pressure on brokers'
commissions and fees. However, brokers will benefit from the
mandatory nature of many insurance products (to meet insured
parties' regulatory and financing requirements) and by the brokers'
somewhat variable cost structure.
Moody's expects that AssuredPartners will limit its discretionary
spending and slow its pace of acquisitions through the downturn to
conserve liquidity and financial flexibility. The company's
financial leverage remains high for its rating category, leaving
little room for error in managing its existing and newly acquired
operations. Moody's expects AssuredPartners to reduce its leverage
in the year ahead through assimilation of recent acquisitions,
expense controls and slight amortization of its term loans. The
firm's private equity sponsors led by GTCR would likely provide
additional support if needed, said Moody's.
AssuredPartners' ratings reflect its growing presence in middle
market insurance brokerage, its good mix of business across
property & casualty insurance and employee benefits, and its
healthy EBITDA margins. The company has made organizational changes
to support organic growth in the low single digits in recent
periods. AssuredPartners is an active acquirer, having completed a
few dozen acquisitions in the past year. The company allows
acquired brokers to operate fairly autonomously under local and
regional brands, while the group centralizes accounting and control
functions and certain carrier relationships.
Credit challenges for the group include aggressive financial
leverage, execution risk associated with acquisitions, and
significant cash outflows to pay contingent earnout liabilities.
Like its peers, AssuredPartners also faces potential liabilities
from errors and omissions in the delivery of professional
services.
Moody's estimates that AssuredPartners' pro forma debt-to-EBITDA
ratio will remain somewhat above 7.5x after giving effect to the
proposed incremental borrowing. Pro forma (EBITDA - capex) interest
coverage will be around 2x, and the free-cash-flow-to-debt ratio
will be in the low single digits. These pro forma metrics include
Moody's adjustments for operating leases, deferred earnout
obligations, run-rate earnings from completed and pending
acquisitions, certain non-recurring costs, and excess cash held to
boost liquidity during the economic downturn. Moody's expects
AssuredPartners to reduce its debt-to-EBITDA ratio below 7.5x over
the next few quarters.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade of AssuredPartners' ratings
include: (i) debt-to-EBITDA ratio below 6x, (ii) (EBITDA - capex)
coverage of interest exceeding 2x, and (iii) free-cash-flow-to-debt
ratio exceeding 5%.
Factors that could lead to a rating downgrade include: (i)
debt-to-EBITDA ratio remaining above 7.5x, (ii) (EBITDA - capex)
coverage of interest below 1.2x, or (iii) free-cash-flow-to-debt
ratio below 2%.
Moody's has assigned the following rating (and loss given default
(LGD) assessment):
Issuer: AssuredPartners, Inc
$300 million seven-year first-lien senior secured term loan at B2
(LGD3).
The rating outlook for AssuredPartners, Inc is unchanged at
stable.
The principal methodology used in this rating was Insurance Brokers
and Service Companies published in June 2018.
Based in Lake Mary, Florida, AssuredPartners ranks among the 15
largest US insurance brokers. The company generated revenue of
$1.35 billion for the 12 months through March 2020.
BALTIMORE 24 INVESTORS: Hires Kutak Rock as Special Counsel
-----------------------------------------------------------
Biltmore 24 Investors SPE, LLC, and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the District of
Arizona to employ the law firm of Kutak Rock as their special
counsel.
Kutak Rock will continue to assist the Debtors in connection with
negotiating, documenting, and finalizing the sale of certain of the
Debtors’ assets and assisting with any related matters that occur
pre- and post-sale.
The lawyers primarily responsible for the professional services,
and their hourly rates are:
Lynn Ziolko $475
Allison Swenson $335
Dean Dinner $500
Ms. Ziolko assures the court that her firm does not represent the
creditors or any other party in interest.
The firm can be reached through:
Lynn Ziolko, Esq.
Kutak Rock
8601 North Scottsdale Road, Suite 300
Scottsdale, AZ 85253-2738
Phone: 480-429-5000
Fax: 480-429-5001
About Biltmore 24 Investors SPE
Biltmore 24 Investors SPE, LLC, based in Phoenix, AZ, and its
debtor-affiliates sought Chapter 11 protection (Bankr. D. Ariz.
Lead Case No. 20-04130) on April 21, 2020.
In the petitions signed by Bruce Gray, manager, Biltmore 24
Investors' estimated assets of $10 million to $50 million, and
estimated liabilities of $50 million to $100 million; Gray Blue Sky
Scottsdale, Gray Guarantors I, Gray Guarantors II, estimated assets
of $50 million to $100 million, and estimated liabilities of $100
million to $500 million; Gray Guarantors III estimated assets of
$10 million to $50 million estimated liabilities of $50 million to
$100 million.
MICHAEL W. CARMEL, LTD., serves as bankruptcy counsel to the
Debtors.
BLEU'SPA INC: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Two affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Bleu'Spa, Inc. 20-11617
Spa Bleu of West Dundee
106 N. 2nd Street
West Dundee IL 60118
Hesperus Peak, Inc. 20-11616
Spa Bleu of South Barrington
100 W. Higgins Rd., Ste. F
Barrington, IL 60010
Business Description: Bleu'Spa and Hesperus Peak offer personal
care services, including hair services, hand
and foot treatments, facials, massage,
makeup, body treatments, and waxing.
Chapter 11 Petition Date: May 28, 2020
Court: United States Bankruptcy Court
Northern District of Illinois
Judge: Hon. Carol A. Doyle (20-11617)
Hon. Janet S. Baer (20-11616)
Debtors' Counsel: Carolina Sales, Esq.
LAKELAW
53 West Jackson Boulevard, Suite 1115
Chicago, IL 60604
Tel: 312-588-5000
Email: csales@lakelaw.com
Bleu'Spa, Inc.'s
Estimated Assets: $100,000 to $500,000
Bleu'Spa, Inc.'s
Estimated Liabilities: $1 million to $10 million
Hesperus Peak's
Estimated Assets: $100,000 to $500,000
Hesperus Peak's
Estimated Liabilities: $500,000 to $1 million
The petitions were signed by Tammy Coakley, president.
Copies of the petitions are available for free at PacerMonitor.com
at:
https://is.gd/2eWKby
https://is.gd/oOFaPN
BORDEN DAIRY: Files Plan That Has Reorganization/Sale Options
-------------------------------------------------------------
Borden Dairy Company, and its debtor-affiliates filed with the U.S.
Bankruptcy Court for the District of Delaware a Joint Chapter 11
Plan and a Disclosure Statement on May 8, 2020.
The Debtors have worked closely with certain of their key
stakeholders to evaluate exit scenarios. On May 8, 2020, the
Debtors filed the Plan. Through the Plan, the Debtors will
consummate one of two alternative transactions to maximize the
value of their estates -- either a standalone reorganization, the
Reorganization Transaction, or a sale of all or substantially all
of the Debtors' assets, the Asset Sale Restructuring.
In the event that the Reorganization Transaction is consummated, on
the Effective Date, pursuant to and in accordance with the Plan,
the Reorganized Debtors shall: (i) issue the New Equity Interests
to certain Holders of Allowed Claims, which will be the principal
source of recovery for such Holders, (ii) enter into the Exit ABL
Facility, (iii) enter into the New Term Loan Facility, (iv) execute
such new organizational documents as may be necessary, which shall
be in form and substance acceptable to the Plan Sponsors, (v) own
and have vested in them all of the Debtors’ assets not otherwise
sold, abandoned, or contributed to Wind-Down Co. as Wind-Down Co.
Assets, and (vi) consummate any other transactions necessary or
appropriate in connection with the foregoing.
In the alternative, if the Debtors, with the consent of the Plan
Sponsors, so determine before the Confirmation Hearing, the Debtors
shall effectuate the Asset Sale Restructuring on the Effective
Date. In connection therewith, the Debtors shall consummate the
Asset Sales, and, among other things, the acquired assets, as set
forth in the Asset Purchase Agreement, shall be transferred to and
vest in the Purchaser free and clear of all Liens, Claims, charges,
or other encumbrances pursuant to the terms of the Asset Purchase
Agreement and Confirmation Order. On the Effective Date, the
Purchaser shall pay to the Debtors the proceeds, if any, from the
Asset Sales. The assets of the Debtors that are not transferred to
the Purchaser pursuant to the Asset Purchase Agreement, if any,
shall vest in Wind-Down Co. free and clear of all Liens, Claims,
charges, or other encumbrances.
Class 6 consists of all General Unsecured Claims. If the Debtors
consummate the Reorganization Transaction, except to the extent
that a Holder of an Allowed General Unsecured Claim agrees to less
favorable treatment, in full and final satisfaction, settlement,
release, and discharge of, and in exchange for, each Allowed
General Unsecured Claim, each Holder of an Allowed General
Unsecured Claim shall receive its Pro Rata share of the GUC
Payment, and its beneficial interest in the Wind-Down Co. GUC
Assets.
If the Debtors consummate the Asset Sale Restructuring, except to
the extent that a Holder of an Allowed General Unsecured Claim
agrees to less favorable treatment, on or as soon as is reasonably
practicable after the Effective Date, in full and final
satisfaction, settlement, release, and discharge of, and in
exchange for, each Allowed General Unsecured Claim, each Holder of
an Allowed General Unsecured Claim shall receive its Pro Rata share
of its beneficial interest in the Wind-Down Co. GUC Assets.
Class 9 consists of all Interests in Holdings. On the Effective
Date, each Holder of Allowed Interests in Holdings shall not be
entitled to any distribution on account thereof, and each Interest
in Holdings shall be deemed automatically cancelled, released, and
extinguished without further action by the Debtors, and the
obligations of the Debtors thereunder shall be discharged.
As of the Petition Date, the Debtors' capital structure consisted
of outstanding funded-debt obligations in the aggregate principal
amount of approximately $255.8 million, consisting of the RCF
Facility, the TLA Facility, and the TLB Facility.
On or before the Effective Date, the Debtors will establish
Wind-Down Co. for purposes of (a) winding down the Debtors'
business and affairs as expeditiously as possible, (b) resolving
Disputed Claims, (c) making distributions on account of Allowed
Claims, (d) enforcing and prosecuting claims, interests, rights,
privileges and the Retained Causes of Action in an efficient
manner, (e) filing appropriate tax returns, (f) complying with the
Debtors’ continuing obligations under the Asset Purchase
Agreement, if any, (g) liquidating the WindDown Co. Assets and
distributing the proceeds to Holders of Allowed TLB Secured Claims
or Allowed General Unsecured Claims, (h) administering the Plan;
and (i) any and all other purposes as set forth in the Wind-Down
Co. Organizational Documents.
If the Reorganization Transaction occurs, the following provisions
shall govern: The Debtors or the Reorganized Debtors, as
applicable, shall fund distributions under the Plan with: (a) Cash
on hand; (b) the New Equity Interests; (c) the proceeds of the Exit
ABL Facility; and (d) the New Term Loans.
If an Asset Sale Restructuring occurs, the following provisions
shall govern: Distributions under the Plan will be funded with (i)
Cash on hand on the Effective Date, (ii) the Asset Sale Proceeds,
and (iii) the revenues and proceeds of all assets of the Debtors,
including proceeds from all Wind-Down Co. Assets.
A full-text copy of the disclosure statement dated May 8, 2020, is
available at https://tinyurl.com/yb2rggz6 from PacerMonitor at no
charge.
The Debtors are represented by:
ARNOLD & PORTER KAYE SCHOLER LLP
D. Tyler Nurnberg
Seth J. Kleinman
Sarah Gryll
70 West Madison Street, Suite 4200
Chicago, Illinois 60602-4231
Telephone: (312) 583-2300
Facsimile: (312) 583-2360
E-mail: tyler.nurnberg@arnoldporter.com
seth.kleinman@arnoldporter.com
sarah.gryll@arnoldporter.com
- and -
YOUNG CONAWAY STARGATT & TAYLOR, LLP
M. Blake Cleary
Kenneth J. Enos
Elizabeth S. Justison
Betsy L. Feldman
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
E-mail: mbcleary@ycst.com
kenos@ycst.com
ejustison@ycst.com
bfeldman@ycst.com
About Borden Dairy Company
Borden Dairy Company -- http://www.bordendairy.com/-- is a
processor and direct-to-store distributor of fresh fluid milk,
dairy case products and other beverages. It produces and
distributes a wide variety of branded and private label
traditional, flavored and specialty milk, buttermilk, dips and sour
cream, juices, tea, and flavored drinks to mass merchandisers,
educational institutions, food service retailers, grocery stores,
drug stores, convenience stores, food and beverage wholesale
distributors, and retail warehouse club stores across the United
States.
Headquartered in Dallas, Borden Dairy operates 12 milk processing
plants and nearly 100 branches across the U.S. It was founded in
1857 by Gail Borden, Jr.
Borden Dairy and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 20-10010) on Jan. 5, 2020.
Judge Christopher S. Sontchi oversees the case.
Borden Dairy was estimated to have $100 million to $500 million in
assets and liabilities as of the bankruptcy filing.
The Debtors tapped Arnold & Porter Kaye Scholer LLP as general
bankruptcy counsel; Young Conaway Stargatt & Taylor LLP as special
counsel; and Donlin Recano as the claims agent.
BORDEN DAIRY: June 4 Hearing on Disclosure Statement
----------------------------------------------------
Borden Dairy Company, et al., intend to present their Disclosure
Statement for approval at a hearing before the Honorable
Christopher S. Sontchi on June 4, 2020, at 2:00 p.m. (ET), convened
at the United States Bankruptcy Court for the District of Delaware,
824 Market Street, 5th Floor, Courtroom No. 6, Wilmington, Delaware
19801.
That objections, if any, to the approval of the Disclosure
Statement must be filed and served on or before May 28, 2020, at
4:00 p.m. (ET).
Co-Counsel to the Debtors:
M. Blake Cleary
Kenneth J. Enos
Elizabeth S. Justison
Betsy L. Feldman
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
E-mail: mbcleary@ycst.com
kenos@ycst.com
ejustison@ycst.com
bfeldman@ycst.com
- and -
D. Tyler Nurnberg
Seth J. Kleinman
Sarah Gryll
ARNOLD & PORTER KAYE SCHOLER LLP
70 West Madison Street, Suite 4200
Chicago, Illinois 60602-4231
Telephone: (312) 583-2300
Facsimile: (312) 583-2360
E-mail: tyler.nurnberg@arnoldporter.com
seth.kleinman@arnoldporter.com
sarah.gryll@arnoldporter.com
About Borden Dairy Company
Borden Dairy Company -- http://www.bordendairy.com/-- is a
processor and direct-to-store distributor of fresh fluid milk,
dairy case products and other beverages. It produces and
distributes a wide variety of branded and private label
traditional, flavored and specialty milk, buttermilk, dips and sour
cream, juices, tea, and flavored drinks to mass merchandisers,
educational institutions, food service retailers, grocery stores,
drug stores, convenience stores, food and beverage wholesale
distributors, and retail warehouse club stores across the United
States.
Headquartered in Dallas, Borden Dairy operates 12 milk processing
plants and nearly 100 branches across the U.S. It was founded in
1857 by Gail Borden, Jr.
Borden Dairy and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 20-10010) on Jan. 5, 2020.
Judge Christopher S. Sontchi oversees the case.
Borden Dairy was estimated to have $100 million to $500 million in
assets and liabilities as of the bankruptcy filing.
The Debtors tapped Arnold & Porter Kaye Scholer LLP as general
bankruptcy counsel; Young Conaway Stargatt & Taylor LLP as special
counsel; and Donlin Recano as the claims agent.
C21 INVESTMENTS: Addresses Market Conditions to Shareholders
------------------------------------------------------------
C21 Investments Inc. released a shareholder letter from Sonny L.
Newman, president and CEO, to the Company's shareholders. The
letter follows below and can also be accessed from the Company's
website at www.cxxi.ca.
March 13, 2020
Dear Fellow Shareholders,
I want to take this opportunity to comment on the very difficult
market conditions at this time as well as any potential effect the
Novel Coronavirus may have on our business operations. As I stated
in my letter dated February 10, 2020, C21's business remains
strong. We continue to integrate where necessary and work on
strengthening our balance sheet, including the acquisition of the
recent Phantom Farms real estate. Further, we continue to
consolidate our Oregon operations to our Bend locations, which will
continue to decrease expenditures and lease liabilities moving
forward, as well as free up extraction equipment for use in our
Nevada operations. In the near term we will report our year-end
financials that will highlight our continued strong operations.
C21 is one of only a handful of U.S. public multi-state cannabis
operators that generates positive operating cash flow. We
currently trade at just over 1x EV/Revenue[1] (trailing quarter
annualized) and our EV/EBITDA[2] is approximately 5x (trailing
quarter annualized), which places us well below our peers and
represents a substantial disconnect between our share price and our
financial performance. Our operations are self-sustaining, which
is paramount in the difficult market conditions that the cannabis
sector continues to face. We remain one of very few public
companies to avoid a dilutive equity raise during the downturn in
the sector. Since stepping in as CEO, I am proud of our track
record to pivot and right-size the business to meet the changing
dynamics of the sector. I am also proud of our work towards
achieving short-term and long-term profitability benchmarks.
The Coronavirus is impacting businesses across the globe. In
addition to focusing on the health and safety of our customers and
employees as our paramount concern, we have also been proactive in
supply chain procurement for packaging supplies in case of any
interruptions. We are very fortunate to have a loyal customer base
in both Nevada and Oregon, particularly our hyper-local customer
base in Northern Nevada. For example, 95% of our Nevada retail
customers are from in-state. In addition, 75% of our revenue is
generated from our own in-house products, which is significant if
there were to be any strain on third-party supply. To date, there
has been no material difference in our customer transaction levels
or consumer habits due to the Coronavirus.
There is little doubt that the cannabis sector has faced strong
headwinds, which impacts all public cannabis companies despite
their operating performance. And now the macro-economic tides are
impacting all sectors based in large part on the significant and
justified concerns over the Coronavirus. During these difficult
times, we will continue to focus on strong business fundamentals.
We are continuing to evaluate all strategic alternatives open to us
to service our debt and fund future growth. Presently, our primary
objective is to secure a favorable debt facility.
We recognize how difficult these current market conditions are on
our shareholders and I would like to make a point of thanking you
all for your continued loyalty under the circumstances. We believe
the market will soon reward cannabis companies and by extension,
their shareholders, that operate with sound fundamentals and
discipline. Our executive team holds substantial equity in the
Company and we will continue to work diligently with our top
priority as the preservation of shareholder value.
Sincerely,
Sonny Newman
President & CEO, C21 Investments
About C21 Investments
Headquartered in Vancouver, Canada, C21 Investments --
http://www.cxxi.ca-- is a vertically integrated cannabis company
that cultivates, processes, and distributes cannabis and
hemp-derived consumer products in the United States. The Company
is focused on value creation through the disciplined acquisition
and integration of core retail, manufacturing, and distribution
assets in strategic markets, leveraging industry-leading retail
revenues with high-growth potential multi-market branded consumer
packaged goods. The Company owns Silver State Relief and Silver
State Cultivation in Nevada, and Phantom Farms, Swell Companies,
Eco Firma Farms, and Pure Green in Oregon. These brands produce
and distribute a broad range of THC and CBD products from cannabis
flowers, pre-rolls, cannabis oil, vaporizer cartridges and
edibles.
C21 Investments reported a net loss of US$23.60 million for the
year ended Jan. 31, 2019, compared to a net loss of US$599,471 for
the year ended Jan. 31, 2018. As of July 31, 2019, the Company had
US$94.83 million in total assets, US$59.25 million in total
liabilities, and US$35.57 million in total shareholder's equity.
Davidson & Company LLP, the Company's independent auditor, issued a
"going concern" qualification in its report on the Company's
consolidated financial statements for the year ended Jan. 31, 2019,
citing that the Company incurred a net loss during the year ended
Jan. 31, 2019 and, as of that date, the Company's current
liabilities exceeded its current assets by $13,316,122. These
events and conditions indicate that a material uncertainty exists
that may cast significant doubt on the Company's ability to
continue as a going concern.
C21 INVESTMENTS: Reports Revenue of $37.7 Million for Fiscal 2020
-----------------------------------------------------------------
C21 Investments Inc. reported preliminary, unaudited, results for
its fiscal year end of Jan. 31, 2020.
Fiscal 2020 (Feb. 1, 2019 to Jan. 31, 2020) (unaudited):
* Revenue of $37.7 million (an increase of 1400% year-over-
year)
* Gross Margin of $16.1 million (before fair value
adjustments), 43% of Revenue
* Adjusted EBITDA of $6.0 million
* 638,115 customer transactions
Fourth Quarter (Nov. 1, 2019 to Jan. 31, 2020) (unaudited):
* Q4 Revenue of $9.5 million (an increase of 365% over Q4
2019)
* Gross Margin of $4.0 million (before fair value
adjustments), 42% of Revenue
* Adjusted EBITDA of $2.9 million
* 166,097 customer transactions
During Fiscal 2020, C21 Investments successfully streamlined its
Oregon operations while ramping up its second Silver State Relief
dispensary in Fernley, Nevada. These changes resulted in improved
operating cash flows, which funded $5 million of debt reduction
without dilutive financing. C21 Investments also acquired key
Phantom Farms' real estate assets thereby reducing long-term lease
liabilities. The Company continues to look for opportunities to
optimize operations and divest non-core assets.
Silver States' Sparks location remains one of the leading
dispensaries in Nevada. While there is a total of 14 licensed
dispensaries in the county, the Sparks dispensary managed to
capture 24% of county sales during the year. Sales from Silver
State represented approximately 5% of the entire Nevada market,
with more than 1,750 customer transactions per day. C21
Investments also launched Phantom Farms' flower and a newly created
Phantom CBD product line in Nevada. The Nevada dispensaries'
top-selling SKUs were from Swell's Hood Oil brand. With these
successes, C21 Investments believes its profitable dispensary model
and scalable cultivation and extraction facilities in Nevada
represent strong future growth opportunities for the Company.
COVID-19 Update:
In March, cannabis dispensaries were deemed an essential business
in Oregon and Nevada; however the State of Nevada mandated cannabis
be delivery-only at that time. As restrictions were eased,
curbside delivery was introduced May 1st, which has proven to be
highly successful at Silver State's dispensaries. With in-store
restrictions lifted May 9th, the Company's dispensaries have
returned to pre-COVID-19 revenue run rates. Notwithstanding the
COVID-19 business disruptions, Q1 Nevada dispensary revenues were
approximately 88% of Q4 levels and 98% of Q1 of last year. This
strong performance is attributed to a loyal customer base, which
has enabled C21 Investments and its Silver State dispensaries to
fare better than many in-state peers who are more reliant on
tourist traffic.
There have been no other material business developments in the
Company's operations which have not previously been disclosed.
Temporary Regulatory Filing Relief:
As a result of logistical delays caused by the COVID-19 pandemic,
the Company is relying on the British Columbia Securities
Commission's blanket order, BC Instrument 51-515 Temporary
Exemption from Certain Corporate Finance Requirements, and
comparable exemptions in other Canadian provincial jurisdictions to
postpone the filing of its Jan. 31, 2019 audited annual financial
statements, and management's discussion and analysis. The Company
is otherwise required to release its Annual Filings on or prior to
June 1, 2020 pursuant to National Instrument 51-102 Continuous
Disclosure Obligations, which is now estimated to be filed on or
before July 14, 2020 in reliance of the Exemption.
The Company is also relying on the U.S. Securities and Exchange
Commission order (Release No. 34-88465) dated March 25, 2020 (the
"SEC Order"), providing conditional relief to public companies that
are unable to timely comply with their filing obligations as a
result of the COVID-19 pandemic. Therefore, the Company is relying
on the SEC Order to extend the June 1, 2020 due date for the filing
of the annual report on Form 20-F estimated to be filed on or
before July 14, 2020 (no later than forty-five (45) days after the
original due date).
About C21 Investments Inc.
Headquartered in Vancouver, Canada, C21 Investments --
http://www.cxxi.ca-- is a vertically integrated cannabis company
that cultivates, processes, and distributes cannabis and
hemp-derived consumer products in the United States. The Company
is focused on value creation through the disciplined acquisition
and integration of core retail, manufacturing, and distribution
assets in strategic markets, leveraging industry-leading retail
revenues with high-growth potential multi-market branded consumer
packaged goods. The Company owns Silver State Relief and Silver
State Cultivation in Nevada, and Phantom Farms, Swell Companies,
Eco Firma Farms, and Pure Green in Oregon. These brands produce
and distribute a broad range of THC and CBD products from cannabis
flowers, pre-rolls, cannabis oil, vaporizer cartridges and
edibles.
C21 Investments reported a net loss of US$23.60 million for the
year ended Jan. 31, 2019, compared to a net loss of US$599,471 for
the year ended Jan. 31, 2018. As of July 31, 2019, the Company had
US$94.83 million in total assets, US$59.25 million in total
liabilities, and US$35.57 million in total shareholder's equity.
Davidson & Company LLP, the Company's independent auditor, issued a
"going concern" qualification in its report on the Company's
consolidated financial statements for the year ended Jan. 31, 2019,
citing that the Company incurred a net loss during the year ended
Jan. 31, 2019 and, as of that date, the Company's current
liabilities exceeded its current assets by $13,316,122. These
events and conditions indicate that a material uncertainty exists
that may cast significant doubt on the Company's ability to
continue as a going concern.
CAMP GALILEO: In Chapter 11 as Pandemic Havocs Finances
-------------------------------------------------------
Madeline Buckley, writing for Chicago Tribune, reports that
Chicago-based summer camp Galileo Learning sought bankruptcy
protection due to the COVID-19 pandemic.
Galileo Learning is the first area camps to pull the plug in the
summer of the 2020 COVID-19 pandemic and filed for Chapter 11
bankruptcy with the hopes of staying in business in the long term
while resolving claims from creditors.
"By filing for Chapter 11 Galileo will be able to remain in
business, fairly address the claims of its creditors, and survive
the unexpected impacts of the pandemic so we can continue to serve
camper families. While we had very much hoped to avoid turning to
the courts, the severity of the pandemic economic crisis and the
complete cancellation of our 2020 in-person camp season has made
business as usual impossible," company spokesperson Jessica Berg
said in a statement.
Parents of campers, some with uncertain financial circumstances due
to COVID-19's impact on the economy, are left frustrated by the
refund policy.
In a federal class action lawsuit, families alleged that Galileo
Learning breached its contract with them by going back on its
cancellation policy. The company is also the subject of at least
six complaints about refunds filed with the Illinois attorney
general's office. According to a spokeswoman, the company is
working with customers to mediate the complaints.
Galileo Learning says that the pandemic ravaged its financial
situation, leaving it without enough cash on hand to refund those
who requested their money back. The Chapter 11 filing allows the
company to reorganize while staying in business.
According to a bankruptcy declaration from Galileo's founder and
CEO Glen Tripp, the camp began preparing for an estimated
enrollment of 45,000 children in September 2020 at 70 sites in
three states, including Illinois. In April 2020, they notified
families that summer programming would be cancelled.
According to the declaration, over 10,500 families paid more than
$11.6 million in tuition, accounting to around one-third of the
company's expected revenue for 2020. During the time of summer
program cancellation, Galileo Learning already spent a huge
percentage of the students' tuition on the wages of 140 workers,
rent of a warehouse and two offices, and equipment and supplies.
"The payment of even large-percentage, partial refunds ... would
have driven Galileo out of business," the declaration said.
The declaration states that the the company holds a little more
than $6.2 million, including around $2.5 million received through a
Paycheck Protection Plan loan at present. It used the PPP funds
for payroll expenses, per the restrictions on the loan, according
to the company's spokesperson.
While waiting for the unfolding of the Chapter 11 process of
Galileo Learning, families can choose to take part in virtual camps
in the summer of 2020, receive future program credits, including
the option for discounted programs.
About Galileo Learning
Galileo Learning, LLC, is in the business of operating innovative
and educational summer camps for pre-kindergarteners through tenth
graders. In its 18 years of operation, it has invested more than
$10 million in the development of more than 2,500 hours of unique
curriculum offerings. Galileo Learning Franchising LLC is a
"wholly-owned subsidiary" of Galileo.
Galileo Learning, LLC, and Galileo Learning Franchising sought
Chapter 11 protection (Bankr. N.D. Cal. Lead Case No. 20-40857) on
May 6, 2020. The petitions were signed by Glen Tripp, chief
executive officer of Galileo Learning, LLC and sole member of
Galileo Learning Franchising.
Galileo Learning, LLC was estimated to have assets and liabilities
of $10 million to $50 million; and Galileo Learning Franchising was
estimated to have assets of $1 million to $10 million and
liabilities of $0 to $50,000.
The Hon. William J Lafferty oversees the case.
HANSON BRIDGETT LLP, serves as bankruptcy counsel to the Debtors.
STRETTO is the claims and noticing agent.
CARMEL MEDICAL: Claims to be Paid From Sale/Refinancing of Property
-------------------------------------------------------------------
Carmel Medical Office Building, LLC, submitted its Third Amended
Plan of Liquidation.
The Plan contemplates the sale or refinance of the Debtor's real
estate.
The Class 3 Secured Claims of CIBM Bank in the amount of
$4,370,141, the Class 4 Secured Claim of MIG Guilford Reserves LLC
in the amount of $400,000 and the Class 5 Secured Claim of Vasev
Commercial Heating & Air Conditioning in the amount of $32,680 are
impaired. In order to pay Classes 3, 4 and 5, the Debtor will
market and sell or refinance its real property. The allowed
secured claim of each class will be paid in full at the time of a
closing on such sale.
Class 6 Unsecured Non-Priority Claims total $96,371 amongst 29
claimants. The unsecured creditors in the class and Class 7 will
receive a pro rata share of any funds remaining from the sale or
refinance of the Real Property after the payment of all secured
claims and expenses of sale and administrative fees and expenses.
Holders of Class 7 Unsecured Deficiency Claims will receive a
pro-rata distribution (in this class and among Class 6 as well)
from the proceeds received from the successful prosecution of the
Causes of Action.
The Class 8 Claim of The Oaks at Baylor Apartments Partners is
subject to avoidance pursuant to Sec. 548; nevertheless, the Debtor
will permit the Oaks to be paid up to the amount of its mortgage
($200,000) after payment of higher priority classes.
The Class 9 Equity holder, Carmel Investment Group, LLC, will
receive any remaining funds after payment in full of all
creditors.
A full-text copy of the Third Amended Plan of Liquidation dated May
11, 2020, is available at https://tinyurl.com/y7ldq2ha from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Jeffrey M. Hester
John J. Allman
Hester Baker Krebs LLC
One Indiana Square, Suite 1600
Indianapolis, Indiana 46204
Tel: (317) 833-3030
E-mail: ihester@hbkfirm.com
E-mail: iallman@hhkfirm.com
About Carmel Medical Office Building
Carmel Medical Office Building, LLC, is a Single Asset Real Estate
Debtor, as defined in 11 U.S.C. Section 101(51B). The Company owns
in fee simple a real property located at 10601 North Meridian
Street Indianapolis, having a current value of $5.3 million (based
on offer received in 2019).
Carmel Medical Office Building, based in Carmel, IN, filed a
Chapter 11 petition (Bankr. S.D. Ind. Case No. 19-03536) on May 15,
2019. In the petition signed by Zakir H. Khan, president, the
Debtor disclosed $6,125,000 in assets and $6,667,625 in
liabilities. The Hon. James M. Carr oversees the case. Jeffrey M.
Hester, Esq., a partner at Hester Baker Krebs LLC, is the Debtor's
bankruptcy counsel.
CATE STREET: PE Firm Files for Chapter 7 Liquidation
----------------------------------------------------
Cate Street Capital, a private equity firm, has filed for Chapter 7
liquidation.
Nick Sambides Jr. of Bangor Daily News reports that Cate Street
Capital leveraged public money worth $16 million for its failed
restart of East Millinocket's Great Northern Paper Co. mill.
According to the Press Herald, Cate Street bought the mill from its
bankrupt former owner, Great Northern Paper, for $1 in 2011 and
brought in investors in an attempt to reopen the facility. A
Portland Press Herald investigation found that Cate Street inflated
the value of its investment and ended up reaping $16 million in
refundable state tax credits.
The Portland Press Herald relates that Cate Street listed assets
that are slightly over $200,000 in cash, and debt that includes
legal bills of ore than $800,000 and around $2.8 million owed to a
Massachusetts company for the natural gas and equipment it provided
to Great Northern Paper Co. The natural gas company is seeking
money in the New Hampshire state court, claiming that Cate Street
failed to pay the money it owed.
According to Bangor Daily News, Great Northern's eventual
bankruptcy left behind a debt trail that the attorney overseeing
the case attributed in part to mismanagement, as Cate Street
managers signed unfavorable deals with related companies that
plunged the company into more debt, despite visible signs that it
was out of cash.
The investigation of Maine Sunday Telegram into Cate Street's deal
also prompted federal and state regulators to close loopholes in
incentive programs that Cate Street utilized in delivering about
$16 million in Maine tax dollars to out-of-state financiers, for
investments that did not improve any part of the East Millinocket
mill.
Great Northern mill closed in February 2013, resulting to the
termination of 212 of the 256 workers and impacting the Katahdin
region economy. Its closure ended over 100 years of international
paper-making success in the region. The Millinocket mill, which
was part of the property bought by Cate Street, closed in 2008.
About Cate Street Capital
Cate Street Capital is a Marco Island, Florida based private equity
firm founded in 2007 and specializing in direct investments. The
firm primarily concentrates on investing in renewable energy, paper
products, and recycled resources sectors.
Cate Street Capital Inc. filed a Chapter 7 bankruptcy petition on
May 12, 2020 (Bankr. D.N.H. Case No. 20-10506) on May 12, 2020.
Judge Bruce A Harwood is the presiding judge.
The Debtor's counsel:
Peter N. Tamposi
The Tamposi Law Group
Tel: (603) 204-5513
E-mail: peter@thetamposilawgroup.com
The Chapter 7 trustee was:
Victor W. Dahar
Victor W. Dahar Professional Association
20 Merrimack Street
Manchester, NH 03101
CBL & ASSOCIATES: Moody's Cuts CFR to Ca & Sr. Unsec. Rating to C
-----------------------------------------------------------------
Moody's Investors Service has downgraded the ratings of CBL &
Associates Limited Partnership, including the corporate family
rating to Ca from Caa1 and senior unsecured debt to C from Caa3.
The speculative grade liquidity rating remains unchanged at SGL-4.
The rating outlook remains negative.
The rating downgrade reflects Moody's expectation that CBL's
liquidity profile will erode rapidly in the next two quarters. The
prolonged disruption in retail activities as a result of the
coronavirus pandemic will lead to further deteriorating tenant
credit profile, a significant challenge for CBL before the
pandemic, given CBL's sizable exposure to distressed and defaulted
retailers in its top 25 tenant list. Moody's expects CBL's tenant
credit profile to worsen materially in the next twelve to eighteen
months and that its weakening fundamental trend to accelerate,
including a meaningful increase in portfolio vacancy, with further
deepening of same-store NOI growth. Moody's also anticipates that
CBL will not be in compliance with its bond and secured credit
facility covenants in the next two quarters.
The following ratings were downgraded:
Downgrades:
Issuer: CBL & Associates Limited Partnership
Corporate Family Rating, Downgraded to Ca from Caa1
Senior Unsecured Regular Bond/Debenture, Downgraded to C from Caa3
Outlook Action:
Issuer: CBL & Associates Limited Partnership
Rating outlook remains negative
RATINGS RATIONALE
The rapid and widening spread of the coronavirus outbreak,
deteriorating global economic outlook, falling oil prices, and
asset price declines are creating a severe and extensive credit
shock across many sectors, regions and markets. The combined credit
effects of these developments are unprecedented. The commercial
mall real estate sector has been one of the sectors most
significantly affected by the shock given its sensitivity to
consumer demand and sentiment. More specifically, the weaknesses in
CBL's credit profile have left it vulnerable to shifts in market
sentiment in these unprecedented operating conditions and CBL
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. Its action in part reflects the impact on CBL, the breadth
and severity of the shock, and the broad deterioration in credit
quality it has triggered.
CBL's access to the contingent liquidity necessary to address the
growing pool of assets that require redevelopment capital
expenditures continues to be significantly constraint while net
operating income growth is projected to be more negative in 2020
than previously anticipated. Moody's expects CBL to be most
vulnerable to J.C. Penney's bankruptcy and Macy's announced
three-year strategic initiative that includes a plan to close 125
of its least productive stores. The greatest risk to CBL who has 47
J.C. Penney stores and 31 Macy's stores is the prospect of
additional vacancies as most of these stores are in locations that
are also suffering from other anchor and in-line tenant vacancies
including Sears and Bon-Ton. CBL has reported negative net
operating income growth since 2017, which is due in part to the
continued trend towards a shift to online shopping and the constant
change in consumer preferences that strains the operating
performance of class B malls.
CBL's increasing difficulty with mortgage refinancing has caused
Moody's to be more concerned about CBL's ability to obtain any
secured financing on its lower quality pool of unencumbered assets.
The REIT also faces significant refinancing hurdles with a large
pool of mortgage loans that will mature in the next eighteen
months, some of which have material loan balances.
Moody's expects CBL's ongoing operating challenges will escalate in
the coming months as the spreading of the coronavirus and
deteriorating macro climate lead to more tenant bankruptcies and
store closures. Moreover, CBL's weak financial position makes it
especially vulnerable to the operating risks given its weak
liquidity.
While CBL's $1.2 billion senior secured credit facility, maturing
in July 2023, which includes a fully-funded $500 million term loan
and a $685 million revolving line of credit, removed CBL's
near-term financing risk, its unsecured bonds are currently trading
at yields ranging between approximately 25% and 27%, which suggests
an increasing likelihood that CBL will need to explore some form of
a distressed debt exchange as the REIT gets closer to their
maturities beginning in 2023. CBL has $450 million in unsecured
bonds due in 2023, $300 million due in 2024 and $625 million due in
2026.
CBL's cushion on its bond covenant compliance remains very modest.
The negative rating outlook captures the potential for further
deterioration in CBL's operating performance and financial metrics,
which could challenge its ability to remain in compliance with the
covenants under its bonds and secured credit facility. The negative
rating outlook also reflects the increased risk of a debt
restructuring.
The SGL-4 speculative grade liquidity rating incorporates the
REIT's weak liquidity profile, which is constrained by the small
size of its secured revolving credit facility, which has been
substantially drawn as of Q1 2020. CBL maintains only a modest
cushion for the covenants' ratios required for debt yield and debt
service ratio. Moreover, a majority of CBL's higher quality assets,
including its Tier 1 and Tier 2 malls, are encumbered and/or
pledged as collateral to the facility. Positively, CBL's dividend
reduction to conserve liquidity beginning in early 2018 reflected a
prudent financial policy.
CBL's senior unsecured notes at C is one notch below the corporate
family rating reflecting the high proportion of secured debt in
CBL's capital structure and Moody's expectation that the
unencumbered assets quality will deteriorate rapidly in the two
quarters.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade is very unlikely in the near to medium term given the
negative outlook and would require CBL to maintain a good liquidity
profile, ample covenant cushion and positive trends in CBL's fixed
charge coverage, same-store NOI growth, rent growth and occupancy
rate. These indications will suggest that CBL will be able to repay
its upcoming maturities in full or refinance them.
Ratings could be downgraded if credit metrics were to weaken such
that the REIT's weak liquidity profile were to erode or a debt
restructuring is enacted.
The principal methodology used in these ratings was REITs and Other
Commercial Real Estate Firms published in September 2018.
CBL & Associates Limited Partnership is the operating partnership
of CBL & Associates Properties, Inc. [NYSE: CBL], which is a retail
REIT headquartered in Chattanooga, Tennessee. CBL's portfolio is
comprised of 108 properties, including 59 malls, 29 associated and
community centers. The properties are located in 26 states as of
December 31, 2019.
CCI CONSTRUCTION: Unsecureds Who OK Plan to Get 96 Monthly Payments
-------------------------------------------------------------------
CCI Construction & Associates, LLC, submitted an Amended Plan of
Reorganization.
The Debtor's financial projections show that the Debtor will have
Monthly PDI of $2,903. The final plan payment is expected to be
paid on July 31, 2028 for classes accepting this Plan and July 31,
2025 for classes not accepting this Plan.
The Plan proposes to pay the Debtor's creditors from cash flow from
operations, with a possibility of recoveries from avoidance
actions.
Without factoring in potential avoidance action recoveries,
non-priority unsecured creditors holding allowed claims will
receive distributions, which the Debtor has valued at approximately
29 cents on the dollar if all classes accept the Plan and
approximately 17.5 cents on the dollar if no classes vote to accept
this Plan.
Class 1 Secured Claims are impaired:
* If Class 1 accepts the Plan, the Debtor will pay secured
creditors the full amount of a claim any consequential portion of
which is supported by valuable collateral held by the Debtor as of
the Petition Date in 96 monthly installments beginning on the
Initial Plan Payment Date at an interest rate of 7.25% per annum,
amortized over a 96-month period.
* If Class 1 does not accept this Plan, the Debtor will pay
secured creditors the value of such creditor's collateral held by
the Debtor on the Petition Date in 60 monthly installments
beginning on the Initial Plan Payment Date at an interest rate of
Two and One Quarter Percent (2.25%) per annum, amortized over a
60-month period.
Class 2 General Unsecured Claims are impaired:
* If class 2 accepts this plan: The Debtor will pay general
unsecured claims as follows:
(1) Beginning on the Initial Plan Payment Date, the Debtor
will make 96 monthly payments to general unsecured creditors equal
to their pro rata share of an amount equal to the difference
between: (a) Monthly PDI; and (b) the Secured Creditor Threshold;
PLUS (2) General unsecured creditors shall receive their pro-rata
share of net amounts recovered from
the pursuit of an and all claims or causes action pursued by the
Litigation Trust.
(2) If Class 2 does not accept this plan: The Debtor will pay
general unsecured claims as follows: (1) Beginning on the Initial
Plan Payment Date, the Debtor shall make 60 monthly payments to
general unsecured creditors equal to their pro-rata share of an
amount equal to the difference between: (a) Monthly PDI; and (b)
the Secured Creditor Threshold; PLUS (2) General unsecured
creditors shall receive their pro-rata share of net amounts
recovered from the pursuit of any and all claims or causes action
pursued by the Litigation Trust.
A full-text copy of the Amended Plan of Reorganization dated May
11, 2020, is available at https://tinyurl.com/y7b4mr9g from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Robert P. Laney
Robert P. Laney, Attorney, PLLC
906 Main Street, Suite 202
N. Wilkesboro, NC 28659
About CCI Construction
CCI Construction & Associates, LLC is a North Carolina limited
liability company. The Debtor has been engaged in the construction
business- specializing in concrete installation -- for over a
decade. The Debtor is represented by Robert P. Laney, Attorney,
PLLC.
CCI Construction & Associates, LLC, sought Chapter 11 protection
(Bankr. W.D.N.C. Case No. 20-50083) on Feb. 26, 2020. Robert
Laney, Esq., at Robert P. Laney, Attorney, PLLC, is the Debtor's
counsel.
CENTENNIAL RESOURCE: S&P Upgrades ICR to 'CCC+'; Outlook Negative
-----------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.-based
oil and gas exploration and production company Centennial Resource
Development Inc. (CDEV) to 'CCC+' from 'SD' (selective default). In
addition, S&P raised its issue-level rating on the company's senior
unsecured notes to 'CCC+' from 'D'. S&P lowered the recovery rating
to '3' from '2' indicating its expectation for moderate (50%-70%;
rounded estimate: 65%) recovery in the event of a default.
S&P said, "At the same time, we are assigning our 'B' issue-level
rating and '1' recovery rating to CDEV's new senior secured
second-lien notes. The '1' recovery rating indicates our
expectation for very high (90%-100%; rounded estimate: 95%)
recovery in the event of a payment default."
The upgrade follows CDEV's issuance of $127.1 million of new senior
secured second-lien notes due 2025, which it exchanged for a
portion of its existing senior unsecured notes due 2026 and 2027.
S&P views the unsecured debt transaction as a distressed exchange
because, in its view, the investors received less than they were
promised under the original securities as the company exchanged the
notes at 50% of par value.
S&P said, "We raised our issuer credit rating on CDEV to reflect
our forward-looking opinion of the company's creditworthiness.
While the distressed exchange reduced its outstanding gross debt by
approximately $127 million, we anticipate that its leverage will
remain high for the rest of 2020. We forecast that CDEV will
heavily outspend its cash flow during 2020 despite management's
further reduction of its capital budget to approximately $265
million for the year and implementation of general and
administrative (G&A) cost-cutting measures." Moreover, in May the
company reduced its operated rig count to zero from five and
expects to curtail its production by up to 40% for the month."
On May 15, 2020, CDEV announced the termination of the sale of its
water infrastructure assets. The company expected to receive $150
million in cash at the close of the transaction and another $75
million over the year following the proposed sale. However,
management also forecast an increase in lease operating costs due
to the transaction.
S&P said, "Our assessment of CDEV's financial risk incorporates our
forecast for debt to EBITDA of about 6x through 2020 under our
base-case production, oil price, and cost assumptions. The company
hedged about 40% of its expected oil production in 2020 at about
$26 per barrel but hasn't implemented any hedging in 2021, which
will provide minimal support to its cash flows.
"The negative outlook reflects our expectation that CDEV's credit
measures will remain elevated over the next two years due to weak
commodity prices. The company has limited hedging in place at
favorable prices, which leaves it especially susceptible to
negative oil price shocks. We expect CDEV to significantly outspend
its cash flows during the year even though the company has sharply
curtailed its capital spending.
"We could lower our rating on CDEV if the company engages in a
transaction that we view as distressed or if we believe the risk of
a restructuring is elevated.
"We could raise our rating on CDEV if commodity prices materially
improve and we believe that the likelihood for further distressed
transactions is remote."
CENTRIC BRANDS: Files for Chapter 11 With Debt-for-Equity Plan
--------------------------------------------------------------
Centric Brands, the licensee of over 100 fashion brands, has gone
to Chapter 11 bankruptcy with a plan to be taken over by private
equity lenders.
The Company has entered into a Restructuring Support Agreement with
substantially all of the Company's secured lenders, led by certain
funds managed by Blackstone, Ares Management Corporation, and HPS
Investment Partners, to recapitalize the Company, provide $435
million in debtor-in-possession financing and allow the Company to
operate without interruption throughout the restructuring process.
Additionally, the agreement contemplates a timely emergence from
the process with a plan to substantially reduce the Company's
funded second lien indebtedness by approximately $700 million,
thereby positioning the business for future growth and success.
Under the terms of the RSA, Centric Brands expects to emerge from
Chapter 11 as a private company. Blackstone will exchange second
lien debt for equity interests in the reorganized company.
Existing senior lenders Ares and HPS will retain their senior loan
positions and will receive equity interests in the reorganized
company.
"Today's agreement marks the beginning of our next chapter as an
even stronger company and builds upon our progress to date
executing on our long-term strategy. The current crisis has
significantly impacted companies across all sectors. The pandemic
disrupted many of our wholesale accounts' ordering and constrained
our cash flow. However, we are confident that with added
flexibility in our capital structure, we will be well-positioned
for long-term success during this period and beyond. We thoroughly
evaluated all possible strategic options to address this
environment. After extensive review, we determined that partnering
with our current lenders to pursue this path will result in a
stronger financial position and more resources to support future
growth, while allowing us to focus on serving key stakeholders,"
said Jason Rabin, chief executive officer of Centric Brands.
Centric expects to continue doing business through the bankruptcy
process. Just like other retailers, Centric attributed its
operational challenges to the coronavirus pandemic. In April 2020,
it furloughed about 1,346 workers and decreased its employees by
600, according to Anurup Pruthi, Centric Brands' chief financial
officer, filed on May 18, 2020.
"Due to the catastrophic impact of the global COVID-19 pandemic on
the worldwide economy, the company has experienced direct negative
impacts on business operations in the form of supply chain
disruption, declines in sales activities, reduced customer orders,
and demands for timely cash payments from production and
distribution partners. The near-total global shutdown caused by
COVID-19 has materially and adversely affected the company's entire
business, both operationally and financially," Pruthi said in the
declaration.
WWD reports that Centric's significant debt load also paved the way
to the bankruptcy filing. It entered the proceedings with $1.7
billion in funded debt, in the form of term loans, revolvers and
notes, according to court filings. Its first lien agents are Ares
Capital Corp. and HPS Investment Partners.
According to WWD, the company's proposed DIP financing package
worth $435 million includes a $160 million term loan and an up to
$275 million asset-based revolving credit facility, according to a
declaration filed by James Baird, partner in the restructuring and
special situations group at the investment bank PJT Partners, which
is advising Centric Brands in the proceedings.
"Substantially all of the debtors' assets are encumbered under
their existing capital structure which, along with the debtors'
uncertain financial condition and the overall weakness in the
retail and apparel industry (which has been exacerbated by the
global COVID-19 pandemic), restricts the availability of, and
options for, post-petition financing," Baird wrote in his
declaration.
The company plans seek permission to pay its essential, or
critical, vendors up to $85 million of their prepetition claims, an
amount the company said is roughly a third of its trade claims.
Because of the bankruptcy filing, Centric may part ways with some
partners, providing an opportunity for certain brands to make some
fresh start.
About Centric Brands
Centric Brands Inc. (CTRQ) -- https://www.centricbrands.com/ --
designs, produces, merchandises, manages and markets kidswear,
accessories, and men's and women's apparel under owned, licensed
and private label brands. Currently, the company and its
affiliates license over 100 brands, including AllSaints, BCBG,
Buffalo, Calvin Klein, Disney, Frye, Herve Leger, Jessica Simpson,
Joe's, Kate Spade, Kenneth Cole, Marvel, Michael Kors, Nautica,
Nickelodeon, Spyder, Timberland, Tommy Hilfiger, Under
Armour, and Warner Brothers. The companies sell licensed products
through both retail and wholesale channels.
Centric Brands and its affiliates sought protection under Chapter
11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-22637)
on May 18, 2020. As of March 31, 2020, Debtors disclosed
$1,855,722,808 in total assets and $2,014,385,923 in total
liabilities.
Judge Sean H. Lane oversees the cases.
Debtors tapped Ropes & Gray, LLP as bankruptcy counsel; PJT
Partners, Inc. as investment banker; Alvarez & Marsal, LLC as
financial advisor; and Prime Clerk, LLC as notice, claims and
Balloting agent.
CHHATRALA GRAND: Plan of Reorganization Confirmed by Judge
----------------------------------------------------------
Judge John T. Gregg has entered an order approving the Third
Amended Disclosure Statement and confirming Fourth Amended Chapter
11 Plan of Debtors Chhatrala Grand Rapids, LLC and Bhogal
Enterprises, LLC.
The provisions of Chapter 11 of the Bankruptcy Code have been
complied with, and all requirements for confirmation of the Plan
and approval of the Disclosure Statement, as amended have been
met.
The Plan has been proposed in good faith and not by any means
forbidden by law.
A copy of the order dated May 8, 2020, is available at
https://tinyurl.com/ybul5b99 from PacerMonitor at no charge.
About Chhatrala Grand Rapids and
Bhogal Enterprises
Chhatrala Grand Rapids, LLC, and its affiliate Bhogal Enterprises,
LLC, operate hotels and motels.
Chhatrala Grand and Bhogal Enterprises sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Lead Case
No.19-03908) on Sept. 16, 2019.
At the time of the filing, Chhatrala Grand had estimated assets of
less than $50,000 and liabilities of between $10 million and $50
million while Bhogal Enterprises had estimated assets of less than
$50,000 and liabilities of between $100,000 and $500,000.
The cases are assigned to Judge John T. Gregg.
The Debtors are represented by Mark H. Shapiro, Esq., at Steinberg
Shapiro & Clark.
CHIEF POWER FINANCE: S&P Lowers Term Loan Rating to 'CCC-'
----------------------------------------------------------
S&P Global Ratings lowered its rating on Chief Power Finance LLC's
senior secured term loan B to 'CCC-' from 'CCC' to reflect its
belief that the project will likely default over the next six
months without an unforeseen positive development.
Chief Power Finance LLC (Chief) is a project-financed portfolio
that consists of partial interests in two coal-fired generating
plants, Keystone (1,711 MW) and Conemaugh (1,711 MW). Both plants
dispatch near base-load given their low-cost supply of coal and
relatively low heat rates. The project is based in Pennsylvania and
sells into the PJM Interconnection.
The 'CCC-' rating reflects weak expected cash flows, high debt
levels, and a debt maturity in December 2020. As a result of
Chief's weak credit position, along with current market conditions
and ongoing weak power prices, S&P now believes a default over the
next six months is inevitable.
S&P said, "The 'CCC-' rating reflects our view that Chief is likely
to default over the next six months absent an unforeseen positive
development. Chief currently faces heightened refinancing risk as
its term loan B matures in December 2020. We forecast total debt
outstanding at maturity in December 2020 between $310 million and
$320 million. In our view, the project is unlikely to refinance
this debt on acceptable terms given the high-anticipated balance
and weak cash flows caused by low PJM power prices." Lenders'
reticence to finance coal-generating plants further increases
refinancing risks."
Continued low power prices in the MAAC subregion of PJM have caused
to maintain S&P's view that Chief's future cash flows will remain
weak, despite relatively good operational performance at its
plants. Power futures prices remain low, driven by the ongoing low
natural gas price environment that reflects increased production in
the Marcellus Shale and weak demand partly because of
COVID-19-related closures. While Chief has generated enough cash
flow to service its debt, Chief will likely fail to meet its
financial commitments unless it refinances the entire amount of
outstanding debt on favorable terms. However, the project's status
as a coal-generating power plant complicates its ability to do so.
Despite Chief's compliance with all environmental regulations, more
stringent regulatory pressures on coal under a future regime may
impose steeper operational costs. Furthermore, lenders, eyeing both
future regulation as well as their own environmental, social, and
governance mandates, will likely continue to eschew financing coal
plants. With a smaller pool of lenders, Chief may face permanently
higher debt service costs, irrespective of broader financial
conditions.
A significant increase in the project's cost of capital after 2020
would severely strain its ability to service its financial
commitments, particularly given our view of the relatively short
expected remaining asset life of both Keystone and Conemaugh, which
we expect to run through 2030. S&P assumes the project will
amortize all its outstanding debt over the remainder of its asset
life. As such, it believes the project's capital structure is not
viable absent a sudden and sharp improvement in financial
conditions.
The negative outlook reflects the risk that the project is likely
to default on its debt obligations or pursue in or out of court
restructuring within six months without unforeseen positive
developments.
S&P could lower the rating if the project defaults on its debt
obligations or if it pursues a restructuring.
S&P could raise the rating if the project is able to fully repay
the outstanding balance on its revolver in April and it doesn't
believe the project will face a nonpayment event over the next six
months.
CHINOS HOLDINGS: Taps Weil Gotshal as Lead Counsel
--------------------------------------------------
Chinos Holdings, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the Eastern District of Virginia to
employ Weil, Gotshal & Manges LLP as their legal counsel effective
May 4.
The firm will assist Debtors in the preparation of a Chapter 11
plan and will provide other legal services in connection with their
Chapter 11 cases.
Weil's hourly rates are as follows:
Members and Counsel $1,100 - $1,695
Associates $595 - $1,050
Paraprofessionals $250 - $435
During the 90 days prior to Debtors' bankruptcy filing, Weil
received payments and advances totaling $11,858,229.
The following is provided in response to the request for additional
information pursuant to the Appendix B-Guidelines .
1. Weil did not agree to a variation of its standard or
customary billing arrangements for its employment with Debtors,
2. No professional at Weil varied his rate based on the
geographic location of Debtors' bankruptcy cases.
3. Weil was engaged by Debtors in the 12 months prior to their
bankruptcy filing. From April 2019 through September 2019, Weil's
hourly rates were $1,050 to $1,600 for members and counsel, $560 to
$995 for associates, and $240 to $420 for paraprofessionals. In
October 2019, the firm adjusted its standard billing rates for its
professionals in the normal course.
4. Weil is developing a prospective budget and staffing plan
and will review such budget with Debtors.
Ray Schrock, Esq., a member of Weil, 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:
Ray C. Schrock, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
Email: ray.schrock@weil.com
About Chinos Holdings
Chinos Holdings, Inc. designs apparels. It offers clothing for men,
women and children as well as accessories and serves customers
worldwide.
Chinos Holdings and its affiliates, including J.Crew Group, Inc.,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
E.D. Va. Lead Case No. 20-32181) on May 4, 2020. At the time of
the filing, Debtors disclosed assets of between $1 billion and $10
billion and liabilities of the same range.
Judge Keith L. Phillips oversees the cases.
The Debtors tapped Weil, Gotshal & Manges, LLP as bankruptcy
counsel; Hunton Andrews Kurth, LLP as local counsel; Lazard Freres
& Co. LLC; Alixpartners, LLP as financial advisor; Hilco Real
Estate, LLC as real estate advisor; KPMG LLP as tax consultant; and
Omni Agent Solutions, LLC as claims, noticing and solicitation
agent and as administrative advisor.
John Fitzgerald, III, acting U.S. trustee for Region 4, appointed a
committee of unsecured creditors.
CLARE OAKS: Bondholders Seek to Alter Residents' Contracts in Plan
------------------------------------------------------------------
According to an article published by Bankrupt Company News,
bondholders Amundi Pioneer Asset Management and Lapis Advisers LP,
filed a Chapter 11 reorganization plan and a disclosure statement
for Barlett, Illinois-based continuing care retirement community
(CCRC) Clare Oaks Senior Living.
According to the report, the Plan requires certain community
residents to select whether they will accept modifications to their
residency agreements related to the return of deposits. If they
vote in favor of the Plan, then Clare Oaks would continue to
operate substantially as it did prior to bankruptcy. Otherwise,
Clare Oaks' "assets will be sold and in all probability all claims
of current and former residents will be worth $0."
Should they opt to accept the plan, then they will not receive
their deposits back after new residents occupied the vacant units
and provided Clare Oaks with new deposits. At present, the operator
has to return the deposits after certain time period passed,
usually one or two years, irrespective of whether there is a
replacement resident.
Bondholders filed the motion to seek court approval for the plan's
disclosure to residents and proposed July 17, 2020 as the voting
deadline.
"This is an alarming development for the retirement community
business model, with deposits and residents' well-being/rights to
date generally considered sacrosanct, even in the bankruptcy
context," the article stated. "The result of this development will
undoubtedly mean that a community's ability to attract new
residents will increasingly depend on the apparent financial health
and waiting list of that retirement community."
About Clare Oaks
Clare Oaks -- https://www.clareoaks.com/ -- is a not-for-profit
corporation that operates a continuing care retirement community.
Its facilities and services include independent living, assisted
living, skilled nursing, rehabilitation, and memory care services.
Clare Oaks sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ill. Case No. 19-16708) on June 11, 2019. It
previously sought bankruptcy protection (Bankr. N.D. Ill. Case No.
11-48903) on Dec. 5, 2011 .
At the time of the filing, the Debtor estimated assets of between
$10 million and $50 million and liabilities of between $100 million
and $500 million.
Judge Donald R. Cassling oversees the case.
The Debtor tapped Polsinelli PC as legal counsel; Solic Capital
Advisors LLC as financial advisor; and Stretto LLC as claims and
balloting agent and as administrative advisor.
The Office of the U.S. Trustee appointed creditors to serve on the
official committee of unsecured creditors on June 28, 2019. The
committee tapped Perkins Coie, LLP as its legal counsel.
COATESVILLE AREA SD: Moody's Rates Series 2020A/2020B Bonds 'Ba3'
-----------------------------------------------------------------
Moody's Investors Service has assigned a Ba3 general obligation
limited tax rating and A2 (fiscal agent) enhanced rating to
Coatesville Area School District, PA's $42.9 million General
Obligation Bonds, Series A and B of 2020, and General Obligation
Notes, Series C and D (Federally Taxable) of 2020. Moody's
maintains a Ba3 general obligation unlimited tax rating on the
district, affecting $44.1 in debt outstanding. Moody's also
maintains a Ba3 lease revenue rating on the district, affecting
$12.4 million in parity rated debt outstanding. The outlook is
negative.
While a portion of the district's debt is supported by a GOULT
pledge, the pledge supporting the majority of the district's rated
debt is limited tax based on the limited ability of Pennsylvania
school districts to increase their property tax levy above a preset
index.
RATINGS RATIONALE
The district's Ba3 GOULT and GOLT ratings reflect its highly
pressured financial position in light of a multiyear trend of
escalating charter school costs. Charter enrollment is nearly 34%
of total district enrollment as of 2019. The associated tuition
costs, as well as the district's special education costs and its
inability to curtail operating expenditures, has resulted in an
ongoing structural imbalance that is expected to persist in the
near term.
The Ba3 rating also incorporates the district's reliance on
one-time savings from the refunding of debt, a sizable deficit
financing in 2018, and frequent cash flow borrowing in order to
maintain a positive fund balance. The district's debt burden is
above average, and it reports significant deferred capital needs.
These challenges to the district's credit profile are somewhat
offset by its large and growing tax base and above average resident
wealth.
The absence of distinction between the GOULT and GOLT ratings
reflects Pennsylvania school districts' ability to apply for
exceptions to the cap on property tax increases in order to cover
debt service, the Commonwealth's history of granting such
exceptions, and the district's full faith and credit pledge
supporting all general obligation debt.
The absence of distinction between the district's general
obligation and lease revenue ratings reflects the district's full
faith and credit general obligation limited tax pledge covering the
lease rental payments.
The A2 enhanced rating reflects its current assessment of the
Pennsylvania School District Intercept Program, which provides that
state aid will be allocated to bondholders in the event that the
school district cannot meet its scheduled debt service payments.
The A2 enhanced rating reflects the presence of language in the
bond documents that requires the paying agent to trigger the state
aid intercept prior to default. As of audited 2019 financial
statements, Coatesville Area School District's state aid revenue
provides more than sum sufficient debt service coverage.
Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety. Coatesville Area School District is not susceptible to
immediate material credit risks related to coronavirus. The
longer-term impact will depend on both the severity and duration of
the crisis. The situation surrounding coronavirus is rapidly
evolving. If its view of the credit quality of Coatesville Area
School District changes, Moody's will publish its updated opinion
at that time.
RATING OUTLOOK
The negative outlook on the district's general obligation and
lease-backed debt reflects its pressured financial condition and
ongoing structural imbalance that is expected to persist in the
near term.
The stable outlook on the enhanced rating mirrors that of the
Commonwealth of Pennsylvania (Aa3 stable).
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
- Structurally balanced operations that are maintained over
multiple reporting periods
- Proven ability to manage and accurately budget for charter
costs; a reduction or stabilization of charter enrollment, coupled
with cost containment
- Improvement in the Commonwealth's rating, resulting in an
upgrade to the Pennsylvania School District State Aid Intercept
Program rating (enhanced)
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
- Further structural imbalance with continued material draws on
reserves
- Additional deficit financing
- Escalation of debt burden
- Deterioration of tax base and wealth levels
- Debt service coverage by state aid falling below sum sufficient
due to increased district debt issuance (enhanced)
- Decline in the Commonwealth's rating, resulting in a downgrade
to the Pennsylvania School District State Aid Intercept Program
rating (enhanced)
LEGAL SECURITY
The district's Series of 2013 bonds are secured by the district's
general obligation unlimited tax pledge, as they were issued to
refund debt that was originally issued prior to the 2006
implementation of the Act 1 index.
The district's Series A and B of 2020 bonds, Series C and D of 2020
notes, and Series of 2017 bonds are secured by the district's GOLT
pledge, which is subject to the limits of Pennsylvania's Act 1
"Taxpayer Relief Act."
The district's Series of 2018 bonds are secured by lease payments
made to the Coatesville Area School District Building Authority.
The lease payments are ultimately secured by the district's full
faith and credit general obligation limited tax (GOLT) pledge, as
per a guarantee agreement between the district and the building
authority.
The bonds are enhanced by the Pennsylvania School District
Intercept Program.
The intercept program is not a general obligation guarantee of the
Commonwealth, and in fact, there have been times when the state has
not distributed any aid to school districts, as was the case during
the 2016 state budget impasse. However, with implementation of Act
85 in 2016, the state has ensured that intercept payments, for the
benefit of bond debt service, will be made even in the absence of
an appropriation budget.
PROFILE
Coatesville Area School District serves 5,450 students in the City
of Coatesville, PA, which is approximately halfway between
Lancaster (A3) and Philadelphia (A2 stable) in Chester County (Aaa
stable). The district operates one high school, three middle
schools, and seven elementary schools. In addition, 3,050 students
are enrolled at charter and cyber schools, representing a
significant source of financial pressure for the district.
METHODOLOGY
The principal methodology used in this underlying rating was US
Local Government General Obligation Debt published in September
2019.
The principal methodology used in this enhanced rating was State
Aid Intercept Programs and Financings published in December 2017.
COLORADO GOLDFIELDS: Unsec. to Get Paid by Loan Obligation Proceeds
-------------------------------------------------------------------
Recreation Properties Ltd. (RPL), a creditor in this Chapter 11
bankruptcy case, filed the Disclosure Statement for Plan of
Reorganization for debtor Colorado Goldfields Inc. dated May 8,
2020.
RPL will loan $125,000 to the Debtor in exchange for a promissory
note in such amount payable by the Debtor to the Plan Proponent
with interest at the prime rate plus 1%, secured by the assets of
the Debtor (Loan Obligation).
Class 3a consists of general unsecured claims which are held by
non-insiders of the Debtor with $2,300,000 estimated amount of
claims. Class 3(a) shall be paid pro-rata from the proceeds
obtained from the Loan Obligation.
Class 3b consists of general unsecured claim which are held by
insiders of the Debtor with $388,500 estimated amount of claims.
Class 3b will be paid pro-rata from the proceeds obtained from the
Loan Obligation.
Class 4 consists of the Equity Interest of the Debtor. This class
will receive nothing under the Plan. Thus, all of the proceeds
from the liquidation of those assets will be used to pay creditors
with senior priority.
When the Plan becomes effective, all property of the Bankruptcy
Estate will be distributed pursuant to the priorities of the Code,
in accordance with the Plan, and as provided in the
reorganization.
Within 15 days of the Effective Date, the Reorganized Debtor and
Joint Venture with Pride of the West, LLC, Todd C. Hennis, San Juan
Corp and Salem Minerals, Inc. (collectively San Juan) will enter
into a joint venture agreement for the purpose of 1) conducting the
remediation required by regulatory agencies to put the Mill back
into compliance, 2) conducting a business feasibility study
regarding putting the Mill owned by Pride of the West, LLC back
into operation in its current location, and 3) jointly conducting a
gold milling operation if feasible.
Some claims have not yet been determined and there could be a
significant delay before the amount of claims is finally
determined. In the interim, the Chapter 11 Trustee will make
partial distributions when he is able to do so, reserving
sufficient funds to make final distributions when all claims have
been finally determined.
The Plan proposes a Capital Contribution and a liquidation. RPL
believes there will be sufficient cash on hand to make the payments
required to be made on the Effective Date. Therefore, the Debtor
believes the Plan is feasible and it is unlikely that there would
be any further need for financial reorganization.
A full-text copy of the Disclosure Statement dated May 8, 2020, is
available at https://tinyurl.com/y96womhz from PacerMonitor.com at
no charge.
Attorneys for RPL:
Shaun A. Christensen, Esq.
Appel, Lucas & Christensen, P.C.
1624 Market Street, Suite 310
Denver, Colorado 80202
Tel: (303) 297-9800
E-mail: christensens@appellucas.com
About Colorado Goldfields Inc.
Lakewood, Colo.-based Colorado Goldfields Inc. is a mining
exploration stage company engaged in the acquisition and
exploration of mineral properties, primarily for gold, silver,
zinc, copper and lead, and the milling and processing of ore from
both owned and non-owned mining properties.
Creditors EnviroSource Corp., Recreation Properties, Ltd. and Todd
Hennis filed a Chapter 7 involuntary petition against Colorado
Goldfields Inc. (Bankr. D. Colo. Case No. 16-20910) on Nov. 8,
2016. On Feb. 1, 2019, the case was converted to one under Chapter
11 (Bankr. D. Colo. Case No. 16-20910). The case has been assigned
to Judge Michael E. Romero.
John C. Smiley was appointed as Chapter 11 trustee for Colorado
Goldfields on Feb. 13, 2019.
COMERICA INCORPORATED: Fitch Rates $400MM Preferred Stock 'BB+'
---------------------------------------------------------------
Fitch Ratings has assigned a rating of 'BB+' to Comerica
Incorporated's (CMA; A-/Stable) $400 million 5.625% issue of
non-cumulative perpetual preferred stock. The preferred shares will
rank subordinate to existing unsecured debt but senior to common
shares. Distributions, when and if declared by the board of
directors, will be payable quarterly in arrears at a fixed annual
rate. Distributions on the preferred shares are non-cumulative. The
preferred shares are perpetual in nature, but may be redeemed at
CMA's option during designated call periods. Proceeds from the
issuance are expected to be used for general corporate purposes.
KEY RATING DRIVERS
CMA's preferred stock is rated 'BB+', which is four notches below
CMA's Viability Rating of 'a-', in accordance with Fitch's Bank
Rating Criteria (Feb. 28, 2020). The preferred stock rating
includes two notches for loss severity given the securities' deep
subordination in the capital structure, and two notches for
non-performance given that the coupon of the securities is
non-cumulative and fully discretionary.
Fitch does not expect CMA to use the proceeds of the preferred
stock issuance to repurchase common shares in the near term. As of
March 31, 2020, CMA suspended its share repurchase program for an
undefined period. At March 31, 2020, the Corporation's estimated
CET1 capital ratio was 9.51%, which was below the company's
long-term target CET1 ratio of approximately 10.0%.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade include:
CMA's preferred stock rating is sensitive to a negative change in
CMA's VR. Pressure on CMA's VR could in turn result from a more
prolonged coronavirus related economic downturn, sustained
quarterly operating losses, or a decline in CET1 below 8.0% absent
a credible plan to rebuild capital above this threshold. Negative
pressure on CMA's VR could also result from insufficient holding
company liquidity coverage necessary to meet the parent's
outstanding obligations or an increase in the holding company's
common equity double leverage above 120%.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
CMA's preferred stock rating is sensitive to a positive change in
CMA's VR. However, Fitch does not foresee the possibility of an
upgrade in CMA's VR in the near term. Any upward momentum would
require resolution of the coronavirus pandemic with minimal impact
to franchise or financial fundamentals.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
COSTA HOLLYWOOD: June 24 Disclosure Statement Hearing Set
---------------------------------------------------------
On April 24, 2020, Costa Hollywood Property Owner, LLC, filed with
the U.S. Bankruptcy Court for the Southern District of Florida a
Disclosure Statement and Plan. On May 8, 2020, Judge A. Jay
Cristol ordered that:
* June 24, 2020, at 2:00 p.m. in the United States Bankruptcy
Court, C. Clyde Atkins United States Courthouse, 301 North Miami
Ave, Courtroom 7, Miami 33128, is the hearing to consider approval
of the disclosure statement.
* May 25, 2020, is fixed as the last day for service of order,
disclosure statement and plan.
* June 17, 2020, is fixed as the last day to file objections to
disclosure statement.
A copy of the order dated May 8, 2020, is available at
https://tinyurl.com/y8ebkuxd from PacerMonitor at no charge.
The Debtor is represented by:
James C. Moon Esquire
200 S Biscayne Blvd #3200
Miami, Fl 33131
About Costa Hollywood Property Owner
Costa Hollywood Property Owner, LLC --
https://www.costahollywoodresort.com/ -- is a privately held
company in the traveler accommodation industry. It owns and
operates Costa Hollywood Beach Resort, a resort hotel in Hollywood
Beach, Florida. Costa Hollywood Beach Resort offers rooms and
suites featuring an elevated design aesthetic and luxe decor.
Costa Hollywood sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-22483) on Sept.
19,2019. In the petition signed by Moses Bensusan, manager and
sole member, the Debtor was estimated to have assets ranging from
$50 million to $100 million and liabilities of the same range. The
Hon. Raymond B. Ray is the case judge. Peter D. Russin, Esq., at
Meland Russin & Budwick, P.A. serves as the Debtor's bankruptcy
counsel.
CRAFTWORKS PARENT: Senior Lender DBFLF Buying All Assets
--------------------------------------------------------
CraftWorks Parent, LLC, and its debtor affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to authorize the
semi-private sale of substantially all of their assets to their
senior lender, DBFLF CFTWE Holdings, L.P., via a credit bid of pre-
and post-petition secured claims, in the amount equal to (x) the
full amount of the outstanding DIP Obligations as of the Closing
Date plus (y) an amount of the Prepetition First Lien Obligations
equal to (A) $93 million minus (B) the sum of (i) the outstanding
DIP Obligations as of the Closing Date, and (ii) the amount of the
Assumed Liabilities.
Prior to the scheduling of a hearing on the Original Bid
Procedures/Sale Motion, to comply with business closure mandates
imposed by governmental authorities as a result of the novel
Coronavirus Disease 2019 outbreak, the Debtors ceased operating all
of their restaurants and laid off approximately 18,000 employees.
As a result, the Proposed Purchaser, which was the stalking horse
purchaser under the Stalking Horse Purchase Agreement, validly
terminated the Stalking Horse Purchase Agreement by notice dated
March 18, 2020.
In light of the Debtors' temporarily discontinued restaurant
operations and the termination of the Stalking Horse Purchase
Agreement, the auction process contemplated in the Original Bid
Procedures/Sale Motion is no longer viable. Following the
termination of the Stalking Horse Purchase Agreement, the Debtors
and their advisors have and continued to work extensively with the
Proposed Purchaser and its advisors on a revised asset purchase
agreement in light of the changed circumstances and that maximizes
the value of the Debtors and their estates. The APA expressly
permits the Debtors to seek and attempt to consummate an alternate
transaction that the Debtors determine, in the exercise of their
business judgment, to be higher and better than the transaction set
forth in the APA.
While the Debtors believe that the Proposed Purchaser's proposal is
the best option available, the Debtors will continue to explore the
market for alternatives that may be better for the Debtors, their
estates, and their creditors and are expressly permitted by the APA
to consider all such alternatives. The APA contemplates no bid
protections in favor of the Proposed Purchaser, including no
break-up fee. The goal is to make the marketing process have as
few barriers to interested parties as is possible under the
circumstances. Such expediencies are required given the Debtors'
challenging situation with limited access to additional financing
and the accumulation of administrative expenses -- through the
semi-private sale process.
Accordingly, the Debtors seek to sell the Purchased Assets to the
Proposed Purchaser free and clear of all Encumbrances as set forth
in the Motion and in the APA, subject to the Debtors' ability until
the Sale Hearing to consider and pursue higher and better
alternatives.
The salient terms of the APA are:
a. Purchaser: DBFLF CFTWE Holdings L.P., an affiliate of
Fortress Credit Co, LLC
b. Sellers: All of the Debtors other than (i) CraftWorks
Parent, LLC; (ii) Craftworks Intermediate Co, LLC; and (iii)
CraftWorks Holdings, LLC
c. Purchase Price: The aggregate consideration for the sale
and transfer of the Purchased Assets will be equal to (x) the full
amount of the outstanding DIP Obligations as of the Closing Date
plus (y) an amount of the Prepetition First Lien Obligations equal
to (A) $93 million minus (B) the sum of (i) the outstanding DIP
Obligations as of the Closing Date, and (ii) the amount of the
Assumed Liabilities.
d. Purchased Assets: Substantially all assets
e. Closing Date: The second Business Day after the date on
which all conditions to the obligations of the Sellers and th
eBuyer to consummate the Contemplated Transactions set forth in
Article VII of the APA have been satisfied or waived by the Party
entitled to waive that condition, or at such other time or on such
other date as will be mutually agreed upon by the parties prior
thereto.
A list of all Contracts and Leases to which a Seller is a party,
together with the estimated Cure Amounts for each Assumed Contract
is attached as Schedule 2.6(a) to the APA. Within five days of its
filing and service of the Motion, the Debtors will file and serve
on all counterparties to such Contracts and Leases the Cure Notice.
The Cure Notice identifies the Contracts and Leases, and the
proposed payment amount necessary to cure any defaults arising
under any Contract or Lease as of the Petition Date.
From and after the date hereof until the Sale Hearing, the Proposed
Purchaser may, in its sole discretion (i) designate a Contract or
Lease listed on Schedule 2.6(a) to the APA for assumption and
assignment to the Proposed Purchaser, effective on and as of the
Closing, or (ii) designate any Contract or Lease for rejection.
During the period from the closing date to June 15, 2020, the
Proposed Purchaser may, in its sole discretion, designate any
Contract or Lease that has not previously been assumed and assigned
or rejected for either assumption and assignment to the Proposed
Purchaser or a third party designee or rejection by providing a
Designation Notice to the Sellers.
The Proposed Purchaser will be responsible for any amounts due and
payable under the Designated Contracts after Closing through the
effective date of such Designated Contract's assumption and
assignment or rejection in accordance with the Proposed Sale
Order.
The Sellers will use their respective commercially reasonable
efforts to obtain an order of the Bankruptcy Court to assign the
Assumed Contracts to the Proposed Purchaser on the terms set forth
in Section 2.6 of the APA.
While there is no formal sale procedure being pre-approved, there
is a fiduciary out and the Purchased Assets will continue to be
marketed and the Debtors will entertain higher and better offers
prior to the Sale Hearing. Consequently, the proposed sale is not
strictly a private sale, and instead is a hybrid of a private sale
with a potential auction component if the fiduciary out is
exercised.
The Debtors, in their business judgment, believe that the sale of
the Purchased Assets to the Proposed Purchaser provides the Debtors
with the best opportunity to maximize the value of the Purchased
Assets for the benefit of all stakeholders and minimize the
continuing risk to going concern value associated with further
delay. Additionally, permitting the Debtors to sell the Purchased
Assets free and clear of Encumbrances, and to remove those assets
from the burdensome and distracting chapter 11 process, will
maximize the potential for rehiring thousands of restaurant
employees as soon as feasibly possible.
Any entity holding Encumbrances on the Purchased Assets will
receive notice of the Motion. The sale of the Purchased Assets
will be free and clear of all Encumbrances. It is appropriate to
sell the Purchased Assets free and clear of successor liability
relating to the Debtors' businesses and the Purchased Assets.
Time is of the essence, and the Debtors and the Proposed Purchaser
intend to close the sale as soon as possible following approval by
the Court. Accordingly, as the exigent nature of the requested
relief justifies immediate action the Debtors respectfully ask that
the Court waive the 14-day stay imposed by Bankruptcy Rules 6004(h)
and 6006(d).
A copy of the APA is available at https://tinyurl.com/y8gmrw4j from
PacerMonitor.com free of charge.
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.
CROSSROADS HEALTH: June 17 Plan & Disclosure Hearing Set
--------------------------------------------------------
On April 30, 2020, Crossroads Health Center, P.L.L.C. filed with
the U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, a Disclosure Statement referring to Plan of
Reorganization.
On May 8, 2020, Judge Christopher Lopez conditionally approved the
Disclosure Statement and established the following dates and
deadlines:
* June 10, 2020, is fixed as the last day for returning ballots.
* June 10, 2020, is fixed as the last day for filing and serving
pursuant to Fed. R. Bankr. P. 3017(c)(2) written objections to the
disclosure statement.
* June 10, 2020, is fixed as the last day for filing and serving
pursuant to Fed. R. Bankr. P. 3020(b)(1) written objections to
confirmation of the plan.
* June 17, 2020, at 1:00 p.m. is fixed for the hearing on
confirmation of the plan and final approval of the Disclosure
Statement.
A copy of the order dated May 8, 2020, is available at
https://tinyurl.com/y72glon3 from PacerMonitor at no charge.
About Crossroads Health Center
Crossroads Health Center, P.L.L.C., owns and operates an internal
medicine clinic in Victoria, Texas. Crossroads Health Center sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Tex. Case No. 19-35441) on Sept. 29, 2019. At the time of the
filing, the Debtor was estimated to have assets of between $500,000
and $1 million and liabilities of between $1 million and $10
million. The case has been assigned to Judge Eduardo V. Rodriguez.
The Debtor tapped the Law Office of Margaret M. McClure as its
legal counsel.
DANCOR TRANSIT: Proposed $2.64M Sale of Dallas Property Approved
----------------------------------------------------------------
Judge Ben Barry of the U.S. Bankruptcy Court for the Western
District of Arkansas authorized Dancor Transit, Inc.'s sale of the
real estate and improvements located at 2340 Lombardy Lane, Dallas,
Texas to JVM Duncanville, LLC for $2,635,000.
The notice of the Motion and Sale Hearing and notice of the
rejection of the Existing Lease are approved. Further, the
rejection of the Existing Lease is authorized by the Order.
The Agreement, all exhibits and schedules thereto, and all of the
terms and conditions thereof are approved.
The sale is free and clear of all Released Claims/Interests, with
all the same released, terminated and discharged as to the Property
and will thereafter be transferred and attached to the proceeds of
the sale.
For the avoidance of doubt, included within the definition of the
Released Claims/Interests are:
A. Deed of Trust from Dan Bearden to George C. Lazar, Fox
Johns Lazar Pekin & Wexler, APC, Trustee(s) for the benefit of
Seacoast Commerce Bank, dated Aug. 7, 2018, filed for record in the
Real Property Records of Dallas County, Texas, on Aug. 20, 2018, as
Instrument Number cc#201800222551 and Assignment of Rents and
Leases of the same date and filed in the Real Property Records of
the same county on August 20, 2018, as Instrument No.
cc#201800222552 and Instrument No. cc#201800222553;
B. Hazardous Substances and Indemnity Agreement filed Aug. 20,
2018, recorded in cc# 201800222554, Real Property Records, Dallas
County, Texas;
C. Appointment of Substitute Trustee appointing George C.
Lazar, George C. Lazar, Fox Johns Lazar Pekin & Wexler, APC,
Trustee, filed Feb. 10, 2020, recorded in cc# 202000039310, Real
Property Records, Dallas County, Texas;
D. Tax lien as evidenced by instrument from DAN BEARDEN to
FYP, LLC, filed June 6, 2019, recorded in cc# 201900145209, Real
Property Records of Dallas County, Texas;
E. Certified Statement of Transfer of Tax Lien filed June 20,
2019, recorded in cc# 201900158140, Real Property Records, Dallas
County, Texas;
F. Certified Statement of Transfer of Tax Lien filed June 20,
2019, recorded in cc#201900158141, Real Property Records, Dallas
County, Texas; and
G. The Existing Lease.
On the Closing Date, simultaneously with, and as a condition
precedent to Closing, the Title Company is authorized to:
a. pay in full any and all real estate taxes (and other
assessments, including but not limited to, property owners'
association ("POA") or other assessment), current or delinquent,
related in any way to the Property, including, but not limited to,
the Seller's prorated portion of all real estate taxes (and other
assessments, including but not limited to, POA or other assessment)
for tax periods prior to year 2020;
b. pay in full and cause the full and complete releases to be
filed of record in the Real Property Records of Dallas County,
Texas with respect to the following:
(i) Tax lien evidenced by that certain instrument from
Dan Bearden to FYP, LLC filed 06/06/2019, recorded in cc#
201900145209, Real Property Records of Dallas County, Texas.
(ii) Certified Statement of Transfer of Tax Lien filed
06/20/2019, recorded in cc# 201900158140, Real Property Records,
Dallas County, Texas.
(iii) Certified Statement of Transfer of Tax Lien filed
06/20/2019, recorded in cc# 201900158141, Real Property Records,
Dallas County, Texas.
c. pay in full the loan ("Loan 22557") previously advanced by
Seacoast Commerce Bank and cause the full and complete releases to
be filed of record in the Real Property Records of Dallas County,
Texas with respect to any and all Liens or other Monetary
Encumbrances related to such Loan 22557, including, but not limited
to, the Seacoast Loan Documents, as defined in the Agreement and/or
Motion;
d. pay in full any and all required closing costs and tax
and/or other expense prorations for the sale, which are owed (and
to be paid) by the Seller pursuant to the Agreement; and
e. pay in full $75,000 for a real estate commission for the
sale of the Property.
The Title Company is further authorized to pay proceeds remaining
from the sale of the Property (after payments described) to the
counsel for the Debtor to be held in the Debtor's counsel's
Interest on Lawyers Trust Account, and such proceeds will become
property of the Debtor's estate which will not be used or disbursed
until further order of the Court authorizes or directs disbursement
of the remaining proceeds. Seacoast is not waiving its right to
assert a claim to such excess proceeds, to the extent such claim
exists.
There will be no assignment fees, increases, or any other fees
charged to the Purchaser as a result of the assumption, assignment,
and sale of the Third Party Warranties and the Permits.
The Purchaser, at its own expense, is authorized to file, register,
or otherwise record a certified copy of the Order and, if any
person or entity that has filed financing statements, mortgages,
mechanic's liens, lis pendens, or other documents or agreements
evidencing claims or interests with respect to the Property will
not have delivered to the Seller prior to the Closing Date, in
proper form for filing and executed by the appropriate parties,
releases of any such claims or interests which the person or entity
has with respect to the Property, once such certified copy of the
Order is filed, registered, or otherwise recorded, such certified
copy will constitute conclusive evidence of the release of all
Released Claims/Interests, to the extent provided therein.
Notwithstanding any other provisions in the Order to the contrary,
the Order will not affect any terms of the Billboard Lease, the
rights/obligations of the lessee (its successors and assigns) under
the Billboard Lease, or the rights/obligations of the lessor (its
successors and assigns) under the Billboard Lease. Moreover, the
Billboard Lease is not included in the term "Released
Claims/Interests" as defined in the Order.
Notwithstanding the provisions of Bankruptcy Rules 6004(h) and
6006(d), there is no stay pursuant to Bankruptcy Rule 6004(h) or
6006(d) and the Order will be effective and enforceable immediately
upon entry.
The counsel for the Debtor will (i) serve a copy of this Order by
mail to all interested parties who were not served electronically;
and (ii) file a report of the sale of the Property with the Court
within five business day of the Closing and attach the Closing
statement.
About Dancor Transit
Dancor Transit Inc., a trucking company headquartered in Van Buren,
Ark., sought Chapter 11 protection (Bankr. W.D. Ark. Case No.
20-70536) on Feb. 27, 2020. The petition was signed by Dancor
President Dan Bearden. At the time of the filing, the Debtor
disclosed assets of between $1 million and $10 million and
estimated liabilities of the same range. Keech Law Firm, PA, led
by Kevin P. Keech, Esq., is the Debtor's legal counsel.
DANCOR TRANSIT: Proposes Wooley Auction of Equipment on June 10
---------------------------------------------------------------
Dancor Transit, Inc.. asks the U.S. Bankruptcy Court for the
Western District of Arkansas to authorize the auction sale of its
interests in certain equipment located in Crawford County, Arkansas
("Excess Equipment").
The Debtor operates a trucking business in Van Buren, Crawford
County, Arkansas.
PACCAR Financial Corp. ("PFC") holds a first priority lien on
certain equipment of the Debtor that is the subject of, and
described in, the Motion. On information and belief, the total
amount due and owing to PFC at the Petition Date was $965,185,
exclusive of post-petition interest, costs, and attorneys' fees.
The Debtor proposes to auction its interests in the Excess
Equipment. It proposes to sell the Excess Equipment by public
auction by Wooley Auctioneers, by on-line auction process to begin
June 10, 2020 at 9:00 a.m. and continuing through and including
June 25, 2020 at 2:00 p.m. The parties wishing to have information
about how to participate in the auction may contact the Debtor's
counsel or the auctioneer directly.
Pursuant to such Auction Contract, the Auctioneer will charge a 10%
commission, which amount will be added to the winning bid and paid
as a buyer's premium, rather than deducted from the sale proceeds.
The Auctioneer will advance the cost of advertising and marketing,
which amount will be reimbursed to the Auctioneer first from the
sale proceeds. The Auctioneer will also advance and be reimbursed
first from the sale proceeds any mechanical expenses incurred in
the process of preparing the equipment for auction.
The Auctioneer will conduct the auction and, once all bids are in
place, allow a representative of PFC to accept or reject the
highest bid amounts. The Debtor believes the method will allow the
parties to take into consideration the gross auction amount to
reach the most beneficial overall sales outcome.
The Auctioneer's transaction costs, plus taxes, and any other
necessary and reasonable costs approved by the Debtor's counsel
associated with the sale will be allowed and treated as
administrative expenses and may be paid in full upon realization of
the gross proceeds from the sale of the Excess Equipment. After
payment of the Auctionee's approved transaction costs, net proceeds
from the sale of the Excess Equipment will be paid directly to PFC
by the Auctioneer.
The sale will be on a strictly "as is, where is" basis with no
warranties being extended except as to title.
The Auction of the Excess Equipment will enable the Debtor to
obtain proceeds that may subsequently be distributed to
substantially reduce, if not entirely eliminate, the debt to PFC.
The Auction of the Excess Equipment is in the best interest of the
Debtor and its
creditors.
The sale of the Excess Equipment at the Auction will be final
without further orders of the Court. The Debtor will, however,
file a Report of Sale within five days of the date of the auction.
Objections, if any, must be filed within 21 days from the date of
Notice.
A copy of the Exhibit A is available at
https://tinyurl.com/y7vdv3hq from PacerMonitor.com free of charge.
About Dancor Transit
Dancor Transit Inc., a trucking company headquartered in Van Buren,
Ark., sought Chapter 11 protection (Bankr. W.D. Ark. Case No.
20-70536) on Feb. 27, 2020. The petition was signed by Dancor
President Dan Bearden. At the time of the filing, the Debtor was
estimated to have assets of between $1 million and $10 million and
liabilities of the same range. Keech Law Firm, PA, led by Kevin P.
Keech, Esq., is Debtor's legal counsel.
DCP MIDSTREAM: Moody's Alters Outlook on Ba2 CFR to Stable
----------------------------------------------------------
Moody's Investors Service moved the outlook of DCP Midstream, LP's
to stable from positive and affirmed its existing ratings,
including the Ba2 Corporate Family Rating and B1 ratings on the
preferred units. DCP's SGL-3 Speculative Grade Liquidity rating is
unchanged. Additionally, DCP Midstream Operating, LP's senior
unsecured notes ratings were affirmed at Ba2 and the B1 rating on
its junior subordinated notes was affirmed.
"The affirmation of DCP's current ratings and return to a stable
outlook from positive reflects the challenging US oil and gas
industry environment and its expectation that DCP's earnings will
not continue to grow in 2020 compared to 2019 levels," stated James
Wilkins, Moody's Vice President. "Moody's expects improvement in
the company's credit metrics to be delayed until commodity prices
further recover and volumes improve."
The following summarizes the ratings activity.
Affirmations:
Issuer: DCP Midstream Operating LP
Senior Unsecured Notes, Affirmed Ba2 (LGD3) from (LGD4)
Senior Unsecured Shelf, Affirmed (P)Ba2
Issuer: DCP Midstream, LLC
Junior Subordinated Notes, Affirmed B1 (LGD6)
Senior Unsecured Notes, Affirmed Ba2 (LGD3) from (LGD4)
Issuer: DCP Midstream, LP
Probability of Default Rating, Affirmed Ba2-PD
Corporate Family Rating, Affirmed Ba2
Pref. Stock Preferred Stock, Affirmed B1 (LGD6)
Pref. Stock Shelf, Affirmed (P)B1
Outlook Actions:
Issuer: DCP Midstream Operating LP
Outlook, Changed to Stable from Positive
Issuer: DCP Midstream, LP
Outlook, Changed to Stable from Positive
RATINGS RATIONALE
The change in outlook to stable from positive reflects Moody's
expectation that the decline in volumes processed through certain
facilities and low commodity prices will depress DCP's profits,
offsetting the additions to 2020 of full year earnings from new
facilities. Exploration and production companies have dramatically
reduced capital spending in 2020, reduced production volumes and
only a portion of DCP's facilities enjoy contracts with 100%
minimum volume commitments. In 2019, DCP brought online processing
capacity in the DJ Basin, expanded its Southern Hills, Front Range
and Texas Express NGL pipelines and saw the completion of the Gulf
Coast Express natural gas pipeline, in which it has a minority
ownership stake. Moody's expects that actions taken by the company
to cut growth and sustaining capital spending, distributions to
unit holders and operating costs will allow it to maintain credit
metrics supportive of the current ratings and adequate liquidity
despite more challenging operating conditions.
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 E&P sector has
been significantly affected by the shock given its sensitivity to
demand and oil prices, and that has affected certain midstream
energy companies that move E&P production volumes. Moody's regards
the coronavirus outbreak as a social risk under its ESG framework,
given the substantial implications for public health and safety.
Its outlook action reflects the impact on DCP's credit quality of
the breadth and severity of the oil demand and supply shocks, and
the company's resilience to a period of low oil prices.
DCP has relatively stable cash flow associated with fee-based
businesses, meaningful scale in the US gathering and processing
sector and basin diversification. Cash flow stability benefits from
a combination of fee-based and hedged revenue that account for
about three-quarters of the gross margin and long-term contractual
arrangements with minimum volume commitments or life of lease or
acreage dedications. DCP enjoys economies of scale as a large
processor of natural gas and natural gas liquids with integrated
gathering & processing as well as logistics assets that transport
and process hydrocarbons from the wellhead to markets. It has a
diversified portfolio with critical mass in three key areas -- the
DJ Basin, Midcontinent region and Permian Basin -- that offers
growth opportunities and also helps offset regulatory risk in
Colorado. The rating and business profile are tempered by inherent
commodity price risk as well as MLP model risks with high payouts
and the reliance on debt and equity markets to fund growth. The
elimination of the incentive distribution rights in 2019 did not
materially change the amount of cash flow distributed, but the
company announced in March 2020 a 50% reduction in distributions.
The rating also considers the support that the parents -- Phillips
66 (A3 stable) and Enbridge Inc. (Baa2 positive) -- have
historically provided.
DCP's SGL-3 Speculative Grade Liquidity Rating indicates adequate
liquidity, which is supported by funds from operations and $558
million of availability (net of $14 million of letters of credit
and $828 million of borrowings as of May 1, 2020) under its $1.4
billion revolving credit facility that matures December 9, 2024.
The revolver has a maximum leverage (net debt/EBITDA) covenant
(5.0x, debt/EBITDA is adjusted for partial year EBITDA for capital
projects and acquisitions). Moody's expects DCP will remain in
compliance with its financial covenant through mid-2021, although
the cushion under the covenant will decline with weaker earnings.
The company has $500 million of notes maturing in September 2021,
which Moody's expects the company will be able to repay with free
cash flow. The company also borrows under an accounts receivable
securitization facility that had $590 million of receivables that
secured $350 million of borrowings as of March 31, 2020. Following
the actions taken by the company to cut its distribution by 50%
($325 million), growth and maintenance capital spending by ~$490
million and operating expenses by ~$90 million, Moody's expects DCP
to maintain adequate liquidity through mid-2021 and to have the
ability to repay its $500 million notes that mature in September
2021.
The stable outlook reflects Moody's expectation that DCP's credit
metrics will support the current ratings, despite the decline in
2020 of commodity prices and US oil and gas production volumes.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if DCP continues to successfully
complete its growth projects, debt to EBITDA is expected to remain
below 4.5x and distribution coverage remains above 1.3x. DCP's Ba2
CFR could be downgraded if leverage exceeded 5.5x or it cannot
maintain a distribution coverage ratio greater than 1x.
The principal methodology used in these ratings was Midstream
Energy published in December 2018.
DCP Midstream, LP, headquartered in Denver, Colorado, is a publicly
traded, gathering and processing MLP. The DCP Midstream, LP common
LP units are owned by the public (43.5%) and the balance of the
common units and General Partner interest is owned by DCP
Midstream, LLC, a 50%/50% joint venture between Phillips 66 and
Enbridge Inc.
DEXKO GLOBAL: Moody's Alters Outlook on B2 CFR to Negative
----------------------------------------------------------
Moody's Investors Service confirmed the ratings of DexKo Global,
Inc., including the corporate family rating at B2, the Probability
of Default Rating at B2-PD, the first lien secured rating at B1 and
the second lien secured rating at Caa1. The outlook is negative.
This action concludes the review for downgrade initiated on March
26, 2020.
The confirmations reflect Moody's view that DexKo's good liquidity
position, including an expectation for solidly positive free cash
flow in 2020, provides the company with near term flexibility
during the recessionary conditions in many of its end markets.
Moody's expects DexKo's leverage profile to likely exceed 8x
debt/EBITDA in 2020 as earnings will be pressured, but to improve
in 2021 as end markets gradually recover and the company reduces
its financial leverage. However, DexKo's leverage profile will
remain highly dependent on the company's financial policy going
forward, including the potential to resume debt-funded
acquisitions.
The following rating actions were taken:
Confirmations:
Issuer: DexKo Global, Inc.
Corporate Family Rating, Confirmed at B2
Probability of Default Rating, Confirmed at B2-PD
Senior Secured 1st Lien Bank Credit Facility, Confirmed at B1
(LGD3)
Senior Secured 2nd Lien Bank Credit Facility, Confirmed at Caa1
(LGD6)
Issuer: AL-KO VT Holdings, Gmbh
Senior Secured 1st Lien Bank Credit Facility, Confirmed at B1
(LGD3)
Outlook Actions:
Issuer: DexKo Global, Inc.
Outlook, Changed To Negative From Rating Under Review
Issuer: AL-KO VT Holdings, Gmbh
Outlook, Changed To Negative From Rating Under Review
RATINGS RATIONALE
DexKo's ratings, including the B2 CFR, reflect Moody's expectation
for credit metrics to weaken through 2020 as the company faces
sharp revenue declines amid recessionary conditions in its highly
cyclical end markets. The company's products, primarily focused on
axles and chassis, are critical components and have a wide range of
end-use applications. Moody's expects at least a low double-digit
revenue decline in 2020 given DexKo's exposure to industrial,
construction, oil and gas and agriculture sectors as well as the
more consumer-driven market of recreational vehicles. Moody's
expects DexKo's earnings to be pressured into 2021 even as the
company's variable cost structure should help maintain EBITA
margins in the low-teens range. Moody's expects DexKo to generate
about $70 million in free cash flow in 2020, partly the result of
working capital management.
With the relatively high financial leverage expected this year,
trajectory of debt/EBITDA will be dependent upon the company's
financial policy as to whether the company reduces debt or resumes
an aggressive approach toward acquisitions within its highly
fragmented industry.
Moody's expects DexKo to maintain a good liquidity position over
the near term. The company's liquidity position is supported by
cash of about $230 million at the end of March 2020 after the
company drew down $143 million on its $150 million revolving credit
facility. However, Moody's expects the company to fully repay
advances under the revolver and to keep the revolver undrawn during
2020.
DexKo's free cash flow generation is supported by the company's
efficient working capital management that is driven by its
relatively short lead times for production, as well as low
maintenance capex requirements of about 1% to 2% of revenue. The
company's liquidity position is further supported by no significant
debt maturities until the revolver in July 2022 and more than
sufficient coverage of approximately $14 million in annual debt
amortization.
The negative outlook reflects Moody's view that DexKo's leverage
could be sustained at elevated levels through 2021 should the
company's earnings remain pressured or the company undertakes
debt-funded acquisitions that are not accretive.
In terms of corporate governance, the company's elevated financial
risk is reflected in its high leverage profile under private equity
ownership and event risk is high for a resumption of acquisitions
when market conditions stabilize.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could downgrade the ratings if DexKo doesn't demonstrate
steady progress reducing its leverage to near 6x debt/EBITDA by the
end of 2021 through either debt reduction or organic earnings
growth. A deterioration in the company's liquidity position,
including a material reduction in cash, or free cash flow that is
approaching breakeven, could result in a downgrade.
An upgrade of the ratings in the near-term is unlikely. Over time,
Moody's could upgrade the ratings if DexKo demonstrates consistent
and profitable organic revenue growth and maintains a financial
policy that supports a leverage profile remaining below 4.5x
debt/EBITDA on a sustained basis.
The principal methodology used in these ratings was Manufacturing
Methodology published in March 2020.
Headquartered in Novi, Michigan, DexKo Global, Inc. is a
manufacturer of trailer axles, motorized chassis and other related
products primarily in North America and Europe. The company serves
a variety of markets including industrial and utility,
agricultural, transportation, oil & gas, recreational vehicles and
motor homes. The company also generates approximately 14% of
revenue from aftermarket replacement part sales. KPS Capital
Partners, LP is the majority owner of the company, while The
Sterling Group and the management team have a minority ownership.
Revenue for the twelve months ended March 31, 2020 was
approximately $1.5 billion.
DFW WINGS: Unsecured Creditors to Have 10% Recovery over 5 Years
----------------------------------------------------------------
DFW WINGS, INC. d/b/a Buffalo Wings & Rings, filed with the U.S.
Bankruptcy Court for the Northern District of Texas, Fort Worth
Division, a Combined Disclosure Statement and Plan of
Reorganization which proposes to pay creditors from cash flow and
future income upon approval of this Plan.
Unsecured creditors with allowed unsecured claims in Class 4 are
expected to receive a distribution of approximately 10% of their
allowed claims over a period of 5 years in equal quarterly
payments. The Debtor estimates the total allowed unsecured claims
under the Plan is $986,133.
Class 4 claimants will not receive interest on their Claims under
the Plan.
The Plan also provides for the payment of administrative and
priority claims as well as secured claims as outlined in the Plan.
Postpetition Debtor reached agreement on the use of cash collateral
with The Bancorp Bank and is paying the sum of $3,600 as adequate
protection payment. The Bancorp Bank still retains its secured
status with respect to all of Debtors' assets and account
receivable. However, based on the amount of debt owed to The
Bancorp and the value of its collateral, The Bancorp is an
undersecured creditor.
Payments and distributions under the Plan will be funded by future
income. The sources of this income consist of income derived from
running the business.
A full-text copy of the Combined Plan and Disclosure Statement
dated May 12, 2020, is available at https://tinyurl.com/y7e83pv8
from PacerMonitor at no charge.
About DFW Wings
DFW Wings, Inc., doing business as Buffalo Wings & Rings, owns and
operates a chicken wings restaurant in Arlington, Texas.
DFW Wings sought Chapter 11 protection (Bankr. N.D. Tex. Case
No.19-43264) on Aug. 7, 2019. In the petition signed by William
Melton, president, the Debtor disclosed total assets of $175,675,
and total liabilities of $1,706,732. The Hon. Edward L. Morris is
the case judge. Behrooz P. Vida, Esq., of THE VIDA LAW FIRM, PLLC,
is the Debtor's attorney.
DISCOVERY DAY: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Discovery Day Academy II, Inc.
23601 North Commons Drive
Bonita Springs, FL 34134
Business Description: Discovery Day Academy II Inc. is an
independent private school founded in 2006.
Discovery Day Academy, located in Bonita
Springs, has developed The Discovery Method,
a project-based learning model, with an
emphasis on children ages two to eight
years.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 20-04183
Debtor's Counsel: Michael R. Dal Lago, Esq.
DAL LAGO LAW
999 Vanderbilt Beach Road, Suite 200
Naples, FL 34108
Tel: 239.571.6877
E-mail: mike@dallagolaw.com
Total Assets: $5,500,000
Total Liabilities: $6,050,389
The petition was signed by Elizabeth A. Garcia, president.
The Debtor stated it has no unsecured creditors.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/DJ8WzM
DIVERSIFIED HEALTHCARE: Moody's Rates Sr. Unsecured Notes 'Ba1'
---------------------------------------------------------------
Moody's Investors Service has assigned a Ba1 rating to Diversified
Healthcare Trust's proposed offering of Gtd senior unsecured notes.
Proceeds will be used to repay the REIT's $250 million term loan
and reduce the outstanding balance on its line of credit.
Diversified Healthcare's Ba2 corporate family rating and senior
unsecured debt ratings remain unchanged. The rating outlook remains
negative.
The following ratings were assigned:
Issuer: Diversified Healthcare Trust
- Gtd Senior Unsecured Notes at Ba1
- Gtd Senior Unsecured Shelf at (P)Ba1
- Senior Unsecured Shelf at (P)Ba2
RATINGS RATIONALE
The new notes will be fully and unconditionally guaranteed on a
joint and several bases and on a senior unsecured basis by all of
Diversified Healthcare's subsidiaries except excluded subsidiaries.
Excluded subsidiaries include those that own properties with
secured debt or not wholly-owned. The REIT's credit facility, which
includes a $1 billion revolver and $450 million of term loans
(including $250 million that will be repaid with the new debt
proceeds) will also benefit from these subsidiary guarantees.
The new notes will be cross-defaulted with existing senior
unsecured notes, but along with the credit facility will have
priority of claim on about $6.7 billion of unencumbered assets.
This priority of claim and the modest amount of debt with
guarantees relative to the large size of the unencumbered asset
pool warrants a Ba1 rating, which is one notch higher than the Ba2
rating on the existing senior unsecured notes that lack these
guarantees. Importantly, the guarantees do no inhibit Diversified
Healthcare's ability to sell or obtain secured financing on assets
held within these subsidiaries, thereby preserving financial
flexibility offered by its unencumbered assets.
Diversified Healthcare'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 facilities. The
REIT also maintains solid fixed charge coverage and a large
unencumbered asset pool that provides financial flexibility.
Moody's also notes that the new notes offering strengthens the
REIT's liquidity and addresses near-term maturity risk.
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.
ESG considerations are material to Diversified Healthcare's credit
profile. Moody's regards the coronavirus outbreak as a social risk
under Moody's ESG framework, given the substantial implications for
public health and safety. The REIT'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. Diversified Healthcare is managed
by The RMR Group, which also manages several other REITs and
operating companies, including Five Star, which is a material
concern with respect to Diversified Healthcare's governance.
The negative outlook reflects the risks Diversified Healthcare
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 maintain
ample liquidity 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 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.
DMDS LLC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: DMDS, LLC
404 Spencer Highway
South Houston, TX 77587
Business Description: DMDS, LLC
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 20-32833
Debtor's Counsel: Larry A. Vick, Esq.
LARRY A. VICK
13501 Katy Freeway, Suite 1460
Houston, TX 77079
Tel: (832) 413-3331
E-mail: lv@larryvick.com
Total Assets: $2,017,633
Total Liabilities: $1,430,653
The petition was signed by David M. Soliman, president.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors at the time of the filing.
A copy of the petition containing is available for free at
PacerMonitor.com at:
https://is.gd/xt1Nhg
DOMINION DIAMOND: Washington Cos. to Buy Assets for $126M
---------------------------------------------------------
Dominion Diamond Mines ULC on May 22, 2020, disclosed that it has
signed a letter of intent ("LOI") with an affiliate of The
Washington Companies ("Washington") under which an entity to be
managed by Washington would acquire substantially all of Dominion's
assets for approximately US$126 million in cash and the assumption
of substantially all of Dominion's operating liabilities.
Washington has also agreed to provide Dominion up to US$60 million
in short-term debtor-in-possession ("DIP") financing.
As previously announced, on April 22 Dominion filed for insolvency
protection under the Companies' Creditors Arrangement Act ("CCAA")
and obtained an order from the Alberta Court of Queen's Bench (the
"Court") granting Dominion protection under the CCAA.
Dominion believes that the proposed sale:
-- Ensures Dominion will be able to deliver on its plans to
resume mining operations at the Ekati Diamond Mine ("Ekati") and
safely recall its furloughed workers as the spread of COVID-19
subsides and diamond markets reopen;
-- Provides assurance to Dominion's employees, suppliers and the
communities in the Northwest Territories that Ekati will continue
to operate into the future;
-- Allows Dominion to pay or meet obligations owed to employees,
including pension obligations, and to remain a significant employer
and corporate citizen in the Northwest Territories; and
-- Provides assurance to the Government of the Northwest
Territories that Dominion will continue to comply with all
appropriate health, safety and environmental standards at Ekati and
provide economic support to the communities in the Northwest
Territories.
Dominion continues to believe in the long-term viability of its
assets and expects to emerge from the CCAA process stronger and
better able to deliver value to all stakeholders, including the
Government and citizens of the Northwest Territories.
Details on Proposed Transaction
In the immediate term, Washington has agreed to provide Dominion up
to US$60 million in DIP financing, which is intended to help
provide the Company sufficient liquidity to fund business
operations and other expenses through the closing of the sale of
Dominion, including ongoing obligations to employees and suppliers
of goods and services. Dominion may draw down up to US$10 million
immediately upon Court approval of the DIP financing and the
balance in instalments conditional on the parties signing the
definitive asset purchase agreement contemplated under the LOI. The
banks who hold the Company's first lien debt (the "First Lien
Debtholders") will be permitted to participate in up to 34% of the
DIP facility and, pursuant to the DIP loan agreement, the First
Lien Debtholders have agreed to support of the proposed sale and
DIP financing transactions.
Under the LOI, an entity managed by Washington will serve as the
"stalking horse" bidder for Dominion's assets, and its bid will be
subject to a Court-supervised bidding process designed to achieve
the highest or otherwise best offer, including an auction if
necessary. Accordingly, Dominion intends to file a motion with the
Court seeking approval of (i) the proposed asset sale, which would
be subject to termination if Dominion determines it has received
one or more higher and better offers; (ii) the proposed DIP
financing; and (iii) bidding procedures for the solicitation of
competing offers, either to purchase part or all of the Company's
assets or to make an investment in the Company. Dominion expects
the sale process to move quickly and close in the coming 90 to 120
days.
Under the sale contemplated by the LOI, Dominion expects the
ongoing business to pay or otherwise satisfy, among other things,
obligations to certain stakeholders, including:
-- Dominion's employees, including pension obligations;
-- Governmental authorities, including reclamation obligations
at Ekati; and
-- Dominion's Impact Benefit Agreement partners and other
Indigenous groups and Northern communities.
Dominion and Washington both recognize the importance of and are
committed to protecting the interests of the Company's local
stakeholders, specifically its employees and obligations at Ekati,
through the CCAA process.
The proposed asset purchase agreement for the purchase of
substantially all the assets of Dominion will be subject to certain
conditions, including Dominion reaching a separate agreement with
Rio Tinto regarding the Dominion/Rio Tinto joint venture at the
Diavik Diamond Mine on terms that are acceptable to Washington. If
an agreement with Rio Tinto on terms acceptable to Washington is
not reached, then the sale would not include Dominion's interest
in, or any liabilities relating to, the Diavik Mine, and would
instead proceed as a sale of Dominion's other assets, including its
interests in Ekati and the Lac de Gras Diamond Project, its diamond
inventory and other assets. Dominion and Washington are hopeful
that a mutually beneficial and equitable resolution can be reached
with Rio Tinto that allows for responsible and economically
sustainable mining practices at Diavik and helps protect the future
of diamond mining in the Northwest Territories.
The obligations under the LOI are non-binding and subject to
definitive documentation. The definitive asset purchase agreement
will also be subject to certain other conditions, including
agreements with the Government of the Northwest Territories and
Dominion's sureties, the absence of COVID-related restrictions on
operations, receipt of certain financing commitments, and other
customary conditions.
A copy of the Initial Order and other Court materials and
information related to the Company's CCAA proceedings are available
on the website maintained by FTI, which has been appointed by the
Court as Dominion's Monitor to oversee the CCAA proceedings:
cfcanada.fticonsulting.com/Dominion.
Blake, Cassels & Graydon LLP is serving as Dominion's legal counsel
and McDermott Will & Emery is serving as U.S. counsel. Evercore is
serving as financial advisor.
About Dominion Diamond Mines
Dominion Diamond Mines ULC -- http://www.ddmines.com/-- is a
Canadian mining company and one of the world's largest producers
and suppliers of premium rough diamond assortments to the global
market. The company owns a controlling interest in the Ekati
Diamond Mine, which it operates, and owns 40% of the Diavik Diamond
Mine. The company also holds a controlling interest in the Lac de
Gras Diamond Project. The Ekati and Diavik Diamond Mines, and the
Lac de Gras Diamond Project are located in the Northwest
Territories of Canada. In addition to its mining and exploration
operations, Dominion has offices in Canada, Belgium and India.
DORIAN LPG: Reports Q4 and Full Year 2020 Financial Results
-----------------------------------------------------------
Highlights for the Fourth Quarter Ended March 31, 2020
* Revenues of $95.2 million.
* Daily Time Charter Equivalent ("TCE") rate for its fleet of
$51,888.
* Net income of $29.4 million, or $0.56 earnings per diluted
share ("EPS"), and adjusted net income of $42.3 million, or
$0.81 adjusted diluted loss per share ("adjusted EPS").
* Adjusted EBITDA of $67.2 million.
* Time chartered-in the 2020-built Future Diamond to its fleet
with an expiration during the first calendar quarter of
2023.
* Repurchased over $34.5 million of its common stock, or
approximately 3.1 million shares, at an average price of
$10.99 per share
Highlights for the Fiscal Year Ended March 31, 2020
* Revenues of $333.4 million.
* TCE rate for its fleet of $42,798.
* Net income of $111.8 million, or $2.07 EPS, and adjusted net
income of $130.0 million, or $2.41 adjusted EPS.
* Adjusted EBITDA of $232.8 million.
* Repurchased over $49.3 million of its common stock, or
approximately 4.4 million shares, at an average price of
$11.24 per share
Key Recent Developments
* Closed the refinancing of the commercial tranche of its 2015
Facility pursuant to an Amended and Restated Facility
Agreement resulting in Dorian LPG borrowing $155.8 million,
of which $152.9 million went to repay the outstanding loan
under the commercial tranche of the 2015 Facility and the
balance of $2.9 million will be available for general
corporate purposes. Key features of the 2015 AR Facility
include:
- Extension of the maturity of the refinanced commercial
tranche from March 2022 until March 2025;
- Reduction of annual principal amortization from $12.3
million to $600,000 on the refinanced commercial
tranche;
- Addition of a $25 million revolving credit facility,
subject to customary availability conditions;
- Reduction in the LIBOR margin on the refinanced
commercial tranche to 250 basis points from 275 basis
points, subject to 10 basis points upward or downward
adjustment based on the Company's loan to value ratio for
vessels secured under the 2015 AR Facility; and
- Additional LIBOR margin reduction of up to 10 basis
points for reduction in the Company's Average Efficiency
Ratio for the vessels in its fleet that are owned or
technically managed pursuant to a bareboat charter.
* Completed a $71.5 million sale and bareboat charter
arrangement for the 2015-built Cresques resulting in net
cash proceeds of $52.5 million, $28.5 million of which it
used to prepay a portion of the 2015 Facility, and the
balance of which will be used for general corporate
purposes. The Cresques Japanese Financing has a mandatory
buyout in 2032 with early purchase options from the end of
year 3 onwards, amortizes principal of $285,000 per month,
and carries a floating interest rate of 1 Month LIBOR plus
2.5%.
* Time chartered-in the 2012-built Astomos Earth to its fleet
with an expiration during the second calendar quarter of
2021.
John Hadjipateras, chairman, president and chief executive officer
of the Company, commented, "It is appropriate that I acknowledge
the commitment of our nearly eight hundred seafarers, five hundred
presently at sea, as well as the dedication of our shore-side
staff. Their professionalism ensures our continued safe operation.
Freight rates have recently fallen substantially, however,
considering the uncertainty about the impact of the pandemic on
demand and the price of crude and natural gas, I believe it is too
early to make any predictions. As a company, Dorian LPG has,
perhaps, never been in a stronger position than we are presently.
As a result of our recent refinancing, we have increased our
liquidity and decreased our cost of debt through an innovative and
environmentally linked structure with new commercial banking
partners."
Fourth Quarter Fiscal Year 2020 Results Summary
Our net income amounted to $29.4 million, or $0.56 per share, for
the three months ended March 31, 2020, compared to a net loss of
$(16.0) million, or $(0.29) per share, for the three months ended
March 31, 2019.
The Company's adjusted net income amounted to $42.3 million, or
$0.81 per share, for the three months ended March 31, 2020,
compared to an adjusted net loss of $(12.0) million, or $(0.22) per
share, for the three months ended March 31, 2019. The Company has
adjusted its net income for the three months ended March 31, 2020
for an unrealized loss on derivative instruments of $12.9 million.
The Company has adjusted its net loss for the three months ended
March 31, 2019 for an unrealized loss on derivative instruments of
$3.9 million.
The $54.3 million increase in adjusted net income for the three
months ended March 31, 2020 compared to the three months ended
March 31, 2019 is primarily attributable to an increase in revenues
of $60.7 million and a $1.8 million decrease in interest and
finance costs, partially offset by increases of $3.5 million in
charter hire expenses from our chartered-in VLGCs, $2.8 million in
vessel operating expenses, $0.7 million depreciation and
amortization and a decrease of $0.7 million in realized gain on
derivatives.
The TCE rate for the Company's fleet was $51,888 for the three
months ended March 31, 2020, a 174.8% increase from the $18,883 TCE
rate from the same period in the prior year, primarily driven by
increased spot market rates. Total fleet utilization (including
the utilization of the Company's vessels deployed in the Helios
Pool) increased from 90.2% in the quarter ended
March 31, 2019 to 91.7% in the quarter ended March 31, 2020.
Vessel operating expenses per day increased to $9,407 during the
three months ended March 31, 2020 from $8,104 in the same period in
the prior year.
A full-text copy of the press release is available for free at:
https://is.gd/Y8dKW3
About Dorian LPG
Stamford, Connecticut-based Dorian LPG Ltd. --
http://www.dorianlpg.com/-- is a liquefied petroleum gas shipping
company and an owner and operator of modern very large gas
carriers. Dorian LPG's fleet currently consists of twenty-four
modern VLGCs, including its nineteen new fuel-efficient 84,000 cbm
ECO-design VLGCs, three 82,000 cbm VLGCs, and two time chartered-in
VLGCs. Dorian LPG has offices in Stamford, Connecticut, USA;
London, United Kingdom; Copenhagen, Denmark; and Athens, Greece.
Dorian LPG reported a net loss of $50.94 million for the year ended
March 31, 2019, a net loss of $20.40 million for the year ended
March 31, 2018, and a net loss of $1.44 million for the year ended
March 31, 2017. As of Dec. 31, 2019, the Company had $1.65 billion
in total assets, $675.81 million in total liabilities, and $982.02
million in total shareholders' equity.
DOUGLAS DYNAMICS: S&P Affirms 'BB-' ICR; Ratings Off Watch Negative
-------------------------------------------------------------------
S&P Global Ratings removed the ratings on Milwaukee-based Douglas
Dynamics Inc. from CreditWatch with negative implications, where it
placed them on April 14, 2020. At the same time, S&P affirmed its
'BB-' issuer credit and issue-level ratings. The outlook is
negative.
S&P is assigning a 'BB-' issue rating and '3' recovery rating to
subsidiary Douglas Dynamics LLC's $250 million term loan due 2026.
The '3' recovery rating indicates S&P's expectation of 50%-70%
recovery (rounded estimate: 50%) in the event of a default.
Douglas Dynamics Inc., a manufacturer and upfitter of work-truck
attachments, is taking effective steps to address near-term
liquidity requirements.
S&P said, "The affirmation and removal from CreditWatch reflects
our favorable view of the steps the company is taking to address
its near-term debt maturities. Also, we believe the company will
continue to generate positive free cash flow (albeit at lower
levels) due to cost reductions and reduced capital expenditures
(capex). As a result, we expect the company will have adequate
liquidity to manage through a difficult operating environment due
to the global coronavirus pandemic. The negative outlook, however,
indicates the potential that we could lower the rating over the
next year if the company's operating performance is significantly
weaker than we expect in our base-case scenario, such that the
company's S&P Global Ratings adjusted debt-to-EBITDA remains above
4x."
The coronavirus pandemic will pressure the company's operating
performance and leverage metrics this year. Douglas Dynamics
temporarily closed its U.S. facilities on March 17, 2020 (which
included one manufacturing facility for the work truck solutions
segment and several larger manufacturing facilities for the work
truck attachments segment). The facilities were closed as a
precautionary measure to protect the health and safety of its
employees. As of April 30, 2020 the company started ramping up
production at these facilities and they have been fully operational
since the middle of May. Although with a return to production there
still could be supply chain issues, particularly with regard to
chassis sourcing, resulting from some of the original equipment
manufacturers (OEMs) shutting down for an extended period. Also,
demand could remain muted as a result of the coronavirus pandemic.
Douglas Dynamics ended 2019 with low S&P Global Ratings' adjusted
debt to EBITDA at 2.4x, which was partially the result of voluntary
prepayments the company made that year. In the months ahead, S&P
believes the company will experience lower demand for its products
as well as additional coronavirus-related headwinds, which will
cause leverage to spike to the 4x area in 2020, before improving to
the low-3x area in 2021.
Chassis constraints and below-average snowfall remain significant
risks that are beyond the company's control.
S&P said, "Prior to COVID-19, the company had already faced supply
chain constraints for chassis due to OEM shutdowns, and we
anticipate this easing slightly as OEMs begin to open up. In
addition, the company's preseason orders were delayed by two weeks
due to the combination of below-average snowfall and above-average
temperatures. Although our current base-case forecast incorporates
relatively average snowfall levels and an improvement in chassis
availability over the next 12 months, these assumptions could
change rapidly as they are outside of the company's control and,
therefore, remain a risk to our forecasted cash flow and leverage
metrics."
S&P said, "Although we anticipate demand to be depressed, we
believe the company will continue to generate positive free cash
flow and maintain adequate liquidity in 2020. In our opinion,
Douglas Dynamics' proactive cost reduction actions, which include
reducing capex and freezing discretionary spending, will partially
offset the negative demand impact from COVID-19. As a result, we
believe that the company will have adequate liquidity to manage
through the global recession. Specifically we anticipate the
company will generate positive free operating cash flow (FOCF) in
2020 around $30 million - $35 million, and have full access to its
$100 million ABL revolving credit facility.
"The negative outlook on Douglas Dynamics reflects the potential
that we could lower the rating over the next 12 months if the
impact from facility shutdowns and demand headwinds associated with
COVID-19 are greater than we currently expect. We currently expect
a meaningful reduction in revenues and EBITDA to result in leverage
rising to the 4x area in 2020 before improving in 2021.
"We could downgrade Douglas Dynamics if we expect the company's
leverage to rise above 4x and we expect it to remain at that level
for the following 12 months. We could also downgrade Douglas
Dynamics if it were unable to generate moderate free operating cash
flow. In our view, this would most likely happen if the
macroeconomic climate is significantly worse than we currently
anticipate, leading to substantially lower demand for the company's
products, as well as continued constraints with its chassis supply
chain.
"We could revise our outlook to stable if we believed Douglas
Dynamics could reduce and sustain debt to EBITDA comfortably below
4x over the next 12-18 months. Under this scenario, we would also
expect the company to generate positive discretionary cash flow and
see relative stabilization in the macro-economy. Due to volatility
associated with snowfall and medium- and heavy-duty trucking, we
would also expect the company to operate with adequate cushion to
thresholds for the rating in benign economic conditions."
ECS REFINING: June 9 Online Auction Scheduled for Recycling Plant
-----------------------------------------------------------------
Tiger Group, with sale partners Aaron Equipment, Rosen Systems and
Perry Videx, will be holding an online auction on June 9, 2020, for
ECS Refining's former multi-medium recycling plant on South
Sinclair Avenue in Stockton.
Assets of the 262,000-square-foot facility are being offered on a
turnkey or piecemeal basis in the sale, which will be conducted on
bidspotter.com. ECS filed for Chapter 11 bankruptcy protection in
2018 and subsequently closed Stockton and two other plants across
the country. The Stockton facility includes process lines for
e-waste, TVs, glass and wood, along with forklifts, electric
walk/ride low-lift pallet trucks and other material-handling
equipment, office furniture and equipment. The building, which
sits on a 37-acre industrial lot, is also available for lease or
purchase.
Manufactured by industry leaders such as Titech, SSI Shredding
Systems, Huron Valley Steel Corp. and West Salem Machinery, the
core equipment includes an electronic waste shredding/separation
line; a CRT monitor and projection TV separation and recycling
line; and a wood pallet shredding and chipping line. All three
lines are still installed as operated. All equipment in the
facility has all been decontaminated in compliance with California
Department of Toxic Substances Control (DTSC) specifications.
John Coelho, Senior Director at Tiger Group, noted that, this
auction will be the final offering of ECS assets. "This follows
our partnership's successful turnkey sale last year of the ECS
facility in Mesquite, Texas," he said. "Stockton, which was ECS'
most significant operation, presents recycling industry companies a
unique opportunity to acquire high-capacity, late-model assets that
can enhance their capacity. Meanwhile, we continue to entertain
turnkey bids, as well as offers for each of the three complete
lines or individual items for immediate sale in advance of the
auction."
A once-prominent player in the recycling industry, ECS Refining
started in Santa Clara in the 1980s and served some of the biggest
corporate clients in the country as an IT asset-management and
disposition company, with a particular focus on the proper handling
of data-sensitive hardware, noted David Goodman, Executive Vice
President at Perry Videx.
"Whether handling electronic waste, glass/CRT or wood, all three
lines at the Stockton plant employ the latest technology," Mr.
Goodman said. "This well-maintained equipment is currently
available to operate in place or be moved to an alternative site."
Bidding in the online auction will open at 10 a.m. (PT) on June 2
and will close in rapid succession at 10 a.m. (PT) on Tuesday, June
9. All bidders are required to register at bidspotter prior the
sale. Interested bidders can preview the assets online at
soldtiger.com and/or make an appointment to see them in person at
the Stockton site on Sunday, June 7, between 10 a.m. (PT) and 4
p.m. (PT). Interested parties may contact Coelho at (617)
523-5866, jcoelho@tigergroup.com.
About ECS Refining Inc.
ECS Refining, Inc. -- https://www.ecsrefining.com/ -- offers a full
suite of IT asset management and disposition solutions. It
provides national brand protection solutions for environmental
services, IT asset management, data protection and end-of-life
electronic recycling services. ECS was founded in 1980 by Jim and
Ken Taggart as a processor of post-manufacturing scrap and residues
for OEMs in the Silicon Valley.
As the electronics industry enjoyed rapid growth and manufacturing
operations were outsourced to other parts of the world, ECS adapted
by shifting its focus to processing post-consumer electronics. The
company has locations in Rogers, Arizona; Santa Clara, California;
Santa Fe Springs, California; Stockton, California; Columbus, Ohio;
Medford, Oregon; Portland, Oregon; and Mesquite, Texas.
ECS Refining sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Cal. Case No. 18-22453) on April 24, 2018. In
the petition signed by Jack Rockwood, president, the Debtor was
estimated to have assets of $1 million to $10 million and
liabilities of $10 million to $50 million.
Judge Robert S. Bardwil oversees the case.
The Debtor tapped Snell & Wilmer LLP as its legal counsel; Ringstad
& Sanders LLP as special counsel; and MCA Financial Group, Ltd., as
its financial advisor.
W. Donald Gieseke was appointed as the Chapter 11 Trustee. The
Trustee hired Felderstein Fitzgerald Willoughby & Pascuzzi LLP as
his legal counsel.
EDGEMARC ENERGY: June 23 Plan & Disclosure Hearing Set
------------------------------------------------------
EdgeMarc Energy Holdings, LLC and its debtor affiliates filed with
the U.S. Bankruptcy Court for the District of Delaware a motion for
entry of an order approving the Disclosure Statement on an interim
basis.
On May 8, 2020, Judge John T. Dorsey granted the motion and ordered
that:
* The Disclosure Statement is approved on an interim basis under
Section 1125 of the Bankruptcy Code, Bankruptcy Rule 3017 and Local
Rule 3017-2.
* June 23, 2020, at 1:00 p.m. is the combined hearing on final
approval of the adequacy of the Disclosure Statement and
confirmation of the Plan.
* June 16, 2020, at 4:00 p.m. is the deadline to file objections
to the adequacy of the Disclosure Statement and confirmation of the
Plan.
* The Debtors shall distribute to creditors entitled to vote on
the Plan the applicable Ballot based on Official Form No. 314,
modified to address the particular circumstances of these Chapter
11 Cases and to include certain additional information that the
Debtors believe to be relevant and appropriate for the Voting Class
to vote to accept or reject the Plan.
* June 12, 2020, at 11:59 p.m., is the deadline to submit
ballots to accept or reject the Plan.
A copy of the order dated May 8, 2020, is available at
https://tinyurl.com/yclbop3x from PacerMonitor.com at no charge.
About EdgeMarc Energy
EdgeMarc Energy Holdings, LLC -- http://www.edgemarcenergy.com/
--is a locally based natural gas exploration and production company
headquartered in Canonsburg, Pa. It is engaged in the acquisition,
production, exploration and development of natural gas and natural
gas liquids from underground deposits in the Appalachian Basin.
EdgeMarc Energy conducts its drilling and exploration activities in
the "stacked" liquid-rich Marcellus shale in Pennsylvania and dry
gas Utica shale in Ohio.
EdgeMarc Energy and its 8 affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 19-11104) on May 15, 2019.
EdgeMarc Energy was estimated to have assets of $100 million to
$500 million and liabilities of the same range as of the bankruptcy
filing.
The Hon. Brendan Linehan Shannon is the case judge.
The Debtors tapped Landis Rath & Cobb LLP as counsel; Davis Polk &
Wardwell LLP as corporate counsel; Evercore Partners as investment
banker; Oportune LLC and Dacarba LLC as financial advisor; and
Prime Clerk LLC as claims agent.
EF-290 LLC: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: EF-290 LLC
7101 Highway 71
Austin, TX 78735
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 20-10640
Judge: Hon. Tony M. Davis
Debtor's Counsel: Charlie Shelton, Esq.
HAJJAR PETERS LLP
3144 Bee Caves Rd
Austin, TX 78746
Tel: 512-637-4956
E-mail: cshelton@legalstrategy.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Stacy Eppen, manager.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/mPQiEL
ENERGY SAVING: Seeks to Hire Bourey Law Offices as Counsel
----------------------------------------------------------
Energy Saving Solutions seeks authority from the US Bankruptcy
Court for the Central District of Illinois to employ Andrew D.
Bourey, Esq. and his firm, Bourey Law Offices as its counsel.
Bourey Law Offices will represent the Debtor in its Chapter 11
bankruptcy case.
Mr. Bourey charges $225 per hour for his services.
Mr. Bourey assures the court that his firm is disinterested as
defined in 11 U.S.C. sec. 101(14).
The firm can be reached through:
Andrew D. Bourey, Esq.
Bourey Law Offices
225 S Main St. Ste 100
Decatur, IL 62523
Phone: +1 217-422-2400
About Energy Saving Solutions
Energy Saving Solutions sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Ill. Case No. 20-70352) on March 12,
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 Mary P. Gorman oversees the case. Andrew D.
Bourey, Esq., at Bourey Law Offices, is Debtor's legal counsel.
ENO RIVER: Moody's Rates Series 2020A & 2020B Bonds 'Ba1'
---------------------------------------------------------
Moody's Investors Service assigns a Ba1 rating to the Public
Finance Authority's $18.31 million Charter School Revenue Bonds
(Eno River Academy Project), Series 2020A, and the $370,000 Taxable
Charter School Revenue Bonds (Eno River Academy Project), Series
2020B. The outlook on all ratings is stable.
RATINGS RATIONALE
The Ba1 rating reflects Eno River Academy's solid market position
characterized by continued enrollment growth, academic performance
that is stronger than both the local school district and state
averages, along with outstanding student retention rates. The
school's financial profile is satisfactory with healthy liquidity
and satisfactory debt service coverage that does not require growth
in students to achieve coverage. While the school has high fixed
costs in the form of debt and pensions, the school does not have
any additional debt plans beyond the current issuance.
Additionally, the rating reflects stressed scenarios relating to
potential coronavirus related state aid cuts for fiscal 2021 and
beyond.
Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety. The coronavirus crisis is not a key driver for this
rating action. Moody's does not see any material immediate credit
risks for Eno River Academy. However, the situation surrounding
coronavirus is rapidly evolving and the longer-term impact will
depend on both the severity and duration of the crisis. If its view
of the credit quality of Eno River Academy changes, Moody's will
update the rating and/or outlook at that time.
RATING OUTLOOK
The stable outlook reflects its expectation that Eno River will
maintain current enrollment projections despite uncertainty
regarding in person learning in the fall. Additionally, Moody's
expects Eno River to maintain satisfactory financial performance
and debt service coverage despite potential coronavirus related
state aid cuts for fiscal 2021.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
- Stronger and sustained debt service coverage
- Moderation of fixed costs
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
- Weakening of debt service coverage
- Liquidity not meeting projections
LEGAL SECURITY
The Series 2020 bonds will be secured by Loan Agreement between the
Public Finance Authority and the Eno River Academy Holdings, Inc.,
a nonprofit corporation, which will serve as borrower, owner, and
lessor of the Lease Agreement. The borrower will then lease the
facilities to Eno River Academy. The 2020 bonds will be further
secured by a mortgage interest on all of the school's facilities
and a pledge of certain funds held under the indenture.
USE OF PROCEEDS
The bonds will finance the purchase of the both the K-8 school
building as well as the high school building plus pay costs of
issuance.
PROFILE
Eno River Academy is located in Hillsborough, North Carolina and
serves a current enrollment of 714 students in grades K-12. The
school is projected to serve 760 students in the fall of 2020.
METHODOLOGY
The principal methodology used in these ratings was US Charter
Schools published in September 2016.
EXIDE HOLDINGS: Returns to Chapter 11; EMEA and AP Biz. for Sale
----------------------------------------------------------------
Exide Technologies and its U.S. subsidiaries have returned to
Chapter 11 bankruptcy.
The Company said that the filing is designed to restore the
Company's liquidity, which had deteriorated further as a result of
the unprecedented global health and economic impact of the COVID-19
pandemic, while the Company pursues a sale of its assets.
TThe Company has separately reached an agreement to sell its EMEA
and Asia-Pacific business to an ad hoc group of its noteholders,
subject to certain conditions outlined in the transaction
documents, and subject to higher or better offers. This business
is not included in the Chapter 11 proceedings and continues to
operate as usual.
"Today's actions are intended to position our businesses around the
world for future growth and profitability while also providing the
greatest benefit to our employees, customers, and other
stakeholders," said Tim Vargo, Chairman, President, and Chief
Executive Officer of Exide, in a May 19 statement. "Our Board of
Directors determined that, given the continued, unsustainable
impact on our cost structure resulting from legacy liabilities in
North America, and in light of the global economic COVID-19
slowdown that has amplified these pressures, a sale of our North
American operations through a court-supervised process provides the
best opportunity to continue delivering high-quality energy storage
solutions and service to our customers."
"We believe this is an attractive business, and we are already
advanced in a robust marketing process that includes active
engagement with a number of potential strategic and financial
buyers," Vargo continued. "We are pleased with the interest to
date and look forward to continued discussions about new ownership
that will drive forward our businesses in North America, EMEA, and
Asia-Pacific. I’d like to thank all of our employees for their
unwavering commitment and hard work during this time of
transition."
Exide has obtained a commitment for debtor-in-possession financing
of $40 million from a group of lenders, including certain of its
existing noteholders. Subject to Court approval, this DIP financing
will provide sufficient liquidity to support ongoing operations in
North America for the duration of the sale process and
restructuring.
Sale to Noteholders
The Company has filed a motion to initiate a competitive bidding
process under Section 363 of the Bankruptcy Code, designed to
achieve the highest or otherwise best offers, for the North
American, EMEA, and Asia-Pacific businesses.
Separately, Exide has entered into a restructuring support
agreement under which an ad hoc group of the Company’s
noteholders would acquire its EMEA and Asia-Pacific business,
subject to certain conditions outlined in the transaction
documents, and subject to higher or better offers. The new owners
intend to maintain continued employment of the Company’s
workforce in these regions. The agreement includes a "go-shop"
period with a bid submission deadline and auction to be held in
early July 2020.
"We have been steadily growing revenue and market share in EMEA and
Asia-Pacific over the past few years," said Mr. Vargo. "As our
lenders have learned more about this business, they were impressed
by its growth trajectory, loyal customer base, and talented
employees. Their increased support reflects their confidence in our
capability to deliver consistent growth and profitability by
bringing to market innovative technologies for energy storage
across each business segment to benefit our customers. We are
pleased to have found a new owner that is committed to supporting
the next phase of growth of our business in these regions."
As part of the agreement, the ad hoc noteholder group has provided
additional liquidity of up to $75 million to ensure that business
remains in a strong financial position during the adverse economic
impacts created by the COVID-19 crisis.
Vargo continued, "The EMEA and Asia-Pacific business entered the
current crisis in good financial health, and we have acted
prudently throughout and, in some cases, have drawn on the support
mechanisms made available by governments to mitigate the impact of
the crisis and associated lockdown. The additional funding provided
as part of this agreement will ensure that this business will
emerge from the current crisis even stronger."
About Exide Technologies
For more than 130 years, Exide Technologies, LLC (exide.com) has
been Powering the World Forward as a global provider of stored
electrical-energy solutions for the Transportation and Industrial
markets. Headquartered in Milton, Georgia, Exide operates in 80
countries with more than 8,000 employees. Exide produces a range of
battery and energy storage systems and specialty applications for
the Transportation, Network Power and Motive Power markets and
industries including agricultural, automotive, electric, light and
heavy-duty truck, marine, materials handling, military, mining,
power-sport, railroad, security, telecommunications, utility and
uninterruptible power supply (UPS), among others. As one of the
world’s largest secondary recyclers, the company is committed to
environmental sustainability
About Exide Holdings
Founded in 1888 and headquartered in Milton, Georgia, Exide --
https://www.exide.com/ -- is a stored electrical energy
solutions company and a producer and recycler of lead-acid
batteries. Across the globe, Exide batteries power cars, boats,
heavy duty vehicles, golf carts, powersports, and lawn and garden
applications. Its network power solutions deliver energy to vast
telecommunication networks in need of uninterrupted power supply.
Exide Technologies first sought Chapter 11 protection (Bankr. Del.
Case No. 02-11125) on April 14, 2002, and exited bankruptcy two
years after. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq.,
at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang
Ziehl & Jones LLP, represented the Debtors in their successful
restructuring.
Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No.
13-11482) on June 10, 2013 and emerged from bankruptcy in 2015. In
the 2013 case, Exide tapped Skadden, Arps, Slate, Meagher & Flom
LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez &
Marsal as financial advisor; Sitrick and Company Inc. as public
relations consultant. The official creditors committee retained
Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as
co-counsel, and Zolfo Cooper, LLC served as its bankruptcy
consultants and financial advisors.
Exide Holdings, Inc., and its affiliates, including Exide
Technologies LLC, sought Chapter 11 protection (Bankr. D. Del. Lead
Case No. 20-11157) on May 19, 2020. Exide Holdings was estimated
to have $500 million to $1 billion in assets and $1 billion to $10
billion in liabilities.
In the newest Chapter 11 case, Weil, Gotshal & Manges LLP is
serving as legal counsel to Exide, Houlihan Lokey is serving as
investment banker, and Ankura is serving as financial advisor.
Richards, Layton & Finger, P.A., is the local counsel. Prime Clerk
LLC is the claims agent, maintaining the page
https://cases.primeclerk.com/Exide2020/
EXIDE TECHNOLOGIES: Judge Approves First Day Motions
----------------------------------------------------
Exide Technologies, a global provider of stored energy solutions,
on May 21 disclosed that customary first day motions to help
facilitate continued operations in the ordinary course of business
while the Company operates in Chapter 11 were approved by Judge
Christopher S. Sontchi of the U.S. Bankruptcy Court for the
District of Delaware.
As part of the court's approval of first day motions, Exide
received authorization from the court to, without interruption:
-- Pay employees in the usual manner and to continue their
health and welfare benefits programs;
-- Continue to manufacture and deliver product to customers;
and
-- Pay suppliers for goods and services provided to the Company
post-petition.
The Court also approved on an interim basis the $40 million in
Debtor-in-Possession ("DIP") financing from a group of lenders,
including certain of its existing noteholders. This DIP financing
will provide sufficient liquidity to support ongoing operations in
North America for the duration of the sale process and
restructuring.
The Court will hold hearings on June 18, 2020 to consider the final
orders regarding Exide's first day motions, including the final
approval of the DIP financing.
"The Court's approval of these critical first day motions is an
important first step, allowing us to continue supplying high
quality energy storage solutions to our customers and honor our
commitments to our stakeholders while pursuing a value-maximizing
sale of our North America, EMEA, and Asia-Pacific operations," said
Exide Chairman, President and Chief Executive Officer Tim Vargo.
As announced on May 19, the Company and certain of its U.S.
subsidiaries have filed voluntary petitions for relief in the U.S.
Bankruptcy Court for the District of Delaware, as one component of
a comprehensive strategy to best position its North America, EMEA,
and Asia-Pacific businesses. The Company's operations outside of
North America are not included in the Chapter 11 proceedings as a
debtor.
Additional Information and Advisors
Additional information about Exide's Chapter 11 proceeding can be
found at exide.com/2020-restructuring. Vendors with questions can
visit https://cases.primeclerk.com/Exide2020/, call a dedicated
hotline at 877-429-4840 between the hours of 9 AM and 6 PM Eastern,
Monday through Friday, or email Exide2020Info@PrimeClerk.com.
Weil, Gotshal & Manges LLP and Richards, Layton & Finger, P.A. are
serving as legal counsel to Exide, Houlihan Lokey is serving as
investment banker, and Ankura is serving as financial advisor.
About Exide Holdings
Founded in 1888 and headquartered in Milton, Georgia, Exide --
https://www.exide.com/ -- is a stored electrical energy
solutions company and a producer and recycler of lead-acid
batteries. Across the globe, Exide batteries power cars, boats,
heavy duty vehicles, golf carts, powersports, and lawn and garden
applications. Its network power solutions deliver energy to vast
telecommunication networks in need of uninterrupted power supply.
Exide Technologies first sought Chapter 11 protection (Bankr. Del.
Case No. 02-11125) on April 14, 2002, and exited bankruptcy two
years after. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq.,
at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang
Ziehl & Jones LLP, represented the Debtors in their successful
restructuring.
Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No.
13-11482) on June 10, 2013 and emerged from bankruptcy in 2015. In
the 2013 case, Exide tapped Skadden, Arps, Slate, Meagher & Flom
LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez &
Marsal as financial advisor; Sitrick and Company Inc. as public
relations consultant. The official creditors committee retained
Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as
co-counsel, and Zolfo Cooper, LLC served as its bankruptcy
consultants and financial advisors.
Exide Holdings, Inc., and its affiliates, including Exide
Technologies LLC, sought Chapter 11 protection (Bankr. D. Del. Lead
Case No. 20-11157) on May 19, 2020. Exide Holdings was estimated
to have $500 million to $1 billion in assets and $1 billion to $10
billion in liabilities.
In the newest Chapter 11 case, Weil, Gotshal & Manges LLP is
serving as legal counsel to Exide, Houlihan Lokey is serving as
investment banker, and Ankura is serving as financial advisor.
Richards, Layton & Finger, P.A., is the local counsel. Prime Clerk
LLC is the claims agent, maintaining the page
https://cases.primeclerk.com/Exide2020/
FE-FA CORP: Riso Buying Bayville Property for $350K
---------------------------------------------------
Fe-Fa Corp. asks the U.S. Bankruptcy Court of the Eastern District
of New York to authorize the sale of real property located at 290
Bayville Avenue, Bayville, New York to Richard Riso for $350,000.
The Debtor is engaged in the business of owning and operating a
retail dry cleaning business and the Subject Property. The
Debtor's financial difficulties are a result of cash flow problems
precipitated by the general downturn in the economy.
Since the filing of the instant case, the Debtor endeavored to
increase its monthly cash flow to support a possible refinance of
the Subject Property generating a sum sufficient to satisfy all of
the Debtor's obligations, or in the alternative, since the
effective date of the amendments to Chapter 11, to consider the
possible conversion of the case to Subchapter V to deal with its
debt obligations.
Unfortunately, since the onset of the Covid-19 crisis, the Debtor's
cash flow has deteriorated, foreclosing all possible options beyond
the sale of the Subject Property. The Debtor now believes that the
sale of the Subject Property will generate sufficient funds to
enable it to satisfy all of its obligations.
The Property is a stand-alone owner occupied commercial building
located in Bayville, New York. Recently, however, the Debtor has
tendered a contract of sale of the Property to the Purchaser for
the price of $350,000. To date, that amount represents the highest
and best offer the Debtor has received for the Property.
The Property is encumbered by a mortgage held by Bayville Village
Cleaners on which there is an outstanding balance in the
approximate amount of $200,000. In addition, there is a judgment
lien held by MBC Ventures, as Assignee in the approximate amount of
$73,000. Based upon the Debtor's estimates, the proceeds of the
proposed sale will be sufficient to satisfy both liens encumbering
the Property.
By the Application, the Debtor asks that the Court enters an order:
(i) approving the sale of the Property to the Purchaser pursuant to
the terms of the Agreement; (ii) approving the sale of the Property
free and clear of all liens, claims, encumbrances and other
interests, with such liens, claims, encumbrances and other
interests to attach to the proceeds of sale in the order of their
priorities, subject to the rights and defenses, if any, of the
Debtor thereto; and (iii) granting such other and further relief as
is appropriate to effectuate the sale of the Property.
A hearing on the Motion is set for June 11, 2020 at 11:00 a.m.
Objections, if any, must be filed no later than 4:00 p.m. seven
days prior to the hearing date.
A copy of the Contract is available at https://tinyurl.com/y7k48goh
from PacerMonitor.com free of charge.
FE-FA Corporation filed for Chapter 11 bankruptcy protection
(Bankr. E.D.N.Y. Case No. 19-76327) on Sept. 13, 2019, listing
under $1 million in assets and liabilities. It is represented by
the law office of Richard S. Feinsilver.
FIRST HORIZON: Fitch Rates $150MM Series E Preferred Stock 'BB-'
----------------------------------------------------------------
Fitch Ratings has assigned a 'BB-' rating to First Horizon National
Corporation's issuance of $150 million of 6.500% non-cumulative
perpetual preferred stock, series E.
FHN intends to use the proceeds for general corporate purposes.
In May 2020, Fitch affirmed FHN's Long-Term Issuer Default Rating
and Viability Rating at 'BBB' and 'bbb', respectively, with a
Stable Outlook.
KEY RATING DRIVERS
Subordinated Debt and Other Hybrid Securities:
The rating for the new offering is equivalent to the rating on
FHN's existing preferred stock. FHN's preferred stock rating is
notched four levels below the respective entities' VRs, two times
for loss severity and two times for non-performance.
RATING SENSITIVITIES
Subordinated Debt and Other Hybrid Securities:
The rating for FHN's preferred stock is sensitive to any change to
FHN's VR.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
Positive rating momentum for FHN is limited in the near to medium
term given the economic environment challenges related to the
coronavirus pandemic and risks associated with the IberiaBank
Corporation transaction. Over the longer term, positive rating
momentum could develop if FHN's earnings -- measured by operating
profit to risk-weighted assets, ROA and/or PPNR less net chargeoffs
to average assets -- consistently outperform the peer median while
maintaining a disciplined risk appetite
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
A more prolonged coronavirus-related economic downturn than under
Fitch's current global base case, or the re-emergence of infections
requiring a re-imposition of lockdown measures, would be negative
for ratings.
Fitch expects FHN's capital ratios will grow from current levels.
FHN's ratings could be downgraded if the company's common equity
Tier 1 capital ratio falls below 8.5% for two quarters absent
credible plans to grow capital ratios back above that level within
a reasonable time frame.
As IBKC's loan portfolio has not been tested through a credit
cycle, FHN's ratings could come under pressure if credit losses
stemming from new geographies gained through the IBKC or Capital
Bank Financial mergers contribute a disproportionate amount of
FHN's overall credit losses in the future. While IBKC's credit
metrics, such as nonperforming assets and net chargeoffs, have been
good over the last few years and could indicate solid underwriting
standards, Fitch acknowledges these metrics also benefit from a
benign credit environment. Negative rating pressure could result
from integration and execution challenges that result in an
inability to achieve the financial targets set out at the
announcement of the IBKC transaction over the longer term.
Holding Company:
If FHN's holding company becomes undercapitalized or management
sustains common equity double leverage above 120%, Fitch could
notch the holding company IDR and VR down from the ratings of FHB.
The holding company could also be notched off the bank if cash and
liquid assets covered less than four quarters of required cash
outlays.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
FIRSTLIGHT HOLDCO: Moody's Affirms B3 CFR, Outlook Stable
---------------------------------------------------------
Moody's Investors Service affirmed FirstLight Holdco Inc.'s B3
Corporate Family Rating, B3-PD Probability of Default Rating, B2 on
the First Lien Senior Secured Credit Facility and Caa2 on the
Senior Secured Second Lien Credit Facility. The outlook is stable.
Affirmations:
Issuer: FirstLight Holdco Inc.
Probability of Default Rating, Affirmed B3-PD
Corporate Family Rating, Affirmed B3
Senior Secured First Lien Bank Credit Facility, Affirmed B2 (LGD3)
Senior Secured Second Lien Bank Credit Facility, Affirmed Caa2
(LGD6)
Outlook Actions:
Issuer: FirstLight Holdco Inc.
Outlook, Remains Stable
RATINGS RATIONALE
FirstLight's credit profile reflects governance risk, with the
private equity owners pursuing an aggressive growth strategy that
tolerates high leverage, over 9x, and significant capital
expenditures (over 60% of revenue, and driven by success-based
contracts with blue chip customers) that is producing negative free
cash flow. This risk is partially mitigated by the sponsors' track
record of injecting equity capital to support cash flow deficits.
The credit profile is also constrained by its small scale and
limited diversity with a regional footprint, and the need to
consistently replace churn in subscriber counts.
Supporting the credit profile is adequate liquidity, with positive
operating cash flow, significant covenant cushion, and a very
favorable maturity profile with limited debt amortization. The
company has a robust fiber network covering 25 metro markets, and
benefits from sizable on-net enterprise revenue, and a growing
fiber-to-the-tower business. FirstLight's majority ownership of its
15,000-route mile metro and long-haul fiber network, with the
remainder comprised largely of various long-term indefeasible
rights of use, is a positive credit factor. These assets produce a
profitable business model with EBITDA margins in the high 30%
range, and position FiberLight to satisfy high-speed data-driven
demand in its markets. Within its underserved second and third tier
target markets, FirstLight has carved out a defensible niche with
fiber-based communication services to mainly large enterprise and
carrier customers. The recurring, contractual based nature of the
revenue model provides a relatively high degree of predictability
and visibility.
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 coronavirus,
deteriorating global economic outlook, falling oil prices, and
asset price declines are creating a severe and extensive shock that
is unprecedented in many sectors, regions, and markets. The
combined credit effects of these developments are unprecedented.
Moody's expects that credit quality around the world will continue
to deteriorate, especially for those companies in the most
vulnerable sectors that are most affected by prospectively reduced
revenues, margins and disrupted supply chains. At this time, the
sectors most exposed to the shock are those that are most sensitive
to consumer demand and sentiment, including global passenger
airlines, lodging and cruise, autos, as well as those in the oil &
gas sector most negatively affected by the oil price shock. Though
Moody's expects the communications infrastructure industry to be
less exposed than others, lower-rated issuers such as FirstLight
are more vulnerable to these unprecedented operating conditions and
to shifts in market sentiment that curtail credit availability.
FirstLight's First Lien Senior Secured revolving credit facility
and Term Loan are rated B2 (LGD3), one notch above the B3 CFR
reflecting their priority position in the collateral of
substantially all assets with upstream guarantees from direct and
indirect domestic subsidiaries, and downstream guarantees from its
parent. The second lien senior secured term loan is rated Caa2, two
notches below the CFR given the subordination to the 1st lien
senior secured credit facility. The instrument ratings reflect the
B3-PD (Probability of Default rating) and its expectation for an
average recovery rate (of 50%) in a distress scenario given the
mixed priority of claims. In an actual distress scenario, the
instrument-level ratings could change based on the potential
outcomes (e.g. bankruptcy versus liquidation) and a detailed
analysis of valuation relative to claim-by-claim asset coverage and
recoveries. Lease rejection claims and trade payables are
insignificant to instrument ratings.
The stable outlook reflects Moody's view that FirstLight will
produce low to mid-single digit revenue and EBITDA growth over the
next 12-18 months. Customer churn will be offset by higher prices
supported by greater demand and enhanced services. Moody's expects
EBITDA margins to remain good, in the high 30% range. Moody's
expects management to spend at least 60% of revenue on capital
expenditures, with success-based capital investments primarily
funded by equity capital injected by the financial sponsor. As the
Company pursues new business, Moody's expects leverage to remain
high given the mismatch in the timing of leverage (front-load)
required to fund the ongoing investments need to produce the
earnings which takes time to materialize. As a result, Moody's
expects persistent negative free cash flows. However, free cash
flow before success and project capex will range comfortably inside
its tolerance for the rating (between 2.5% and 10%).
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The corporate family rating is unlikely to be upgraded given the
Company's high leverage, and small scale, but Moody's could
consider a positive rating action if free cash flow before
estimated success/project capex / debt (Moody's adjusted) is
sustained above 10%. An upgrade would also be conditional on larger
scale, improved operating trends, and better liquidity. The
corporate family rating could be downgraded if free cash flow
before estimated success/project capex / debt (Moody's adjusted) is
sustained below 2.5%. Moody's would also consider a negative rating
action if leverage rises further, liquidity deteriorates, or
operating trends worsen.
FirstLight, with headquarters in Albany, NY, is a fiber bandwidth
infrastructure provider in the Northeast US serving mobile
wireless, wholesale carrier and enterprise customers. FirstLight's
nearly 15,000-mile fiber network (post MFC acquisition) extends to
six states and 25 metro markets, with network connections to over
8,000 locations. The Company provides high capacity data services
including internet solutions, private connectivity, colocation in
data centers, and traditional voice and data products. Revenues
were approximately $199 million (for the last twelve months ended
March 31, 2020). FirstLight is owned and controlled by investment
funds affiliated with Antin Infrastructure Partners.
The principal methodology used in these ratings was Communications
Infrastructure Industry published in September 2017.
FORD MOTOR: Moody's Confirms Ba2 CFR & Alters Outlook to Negative
-----------------------------------------------------------------
Moody's Investors Service confirmed the Ford Motor Company's
corporate family rating and senior unsecured debt ratings at Ba2;
the outlook is negative. The Speculative Grade Liquidity rating is
unchanged at SGL-1. This rating action concludes a review for
possible downgrade that began on March 25, 2020.
RATINGS RATIONALE
Ford's ratings, including the Ba2 CFR, reflect Moody's view that
the company's pro forma March 31 cash liquidity position of $42
billion (after the impact of $8 billion in proceeds an April 22
debt issuance) will provide it with ample liquidity to cover the
sizable cash burn the company will generate through 2021. This cash
burn, which Moody's expects will approximate $8 billion in 2020 and
$3 billion in 2021, will result from: 1) the severely negative
impact of the coronavirus on global auto shipments; 2) the sizable
operating and competitive disadvantages that Ford faces relative to
peers in its core markets; and, 3) the need to fund the
approximately $5 billion in remaining expenditures associated with
the Fitness Redesign restructuring program that is intended to
address this competitive gap. Importantly, Moody's believes that
Ford's liquidity position and restructuring initiatives could
provide a pathway for the company to restore credit metrics to
appropriate levels by 2022.
Ford entered the downturn from a comparatively weak position, being
in the early stage of an extensive and costly restructuring program
that alone will cost around $7 billion in total. Ford needs to
continue programs to reverse the prolonged erosion in operating
performance and competitive position in all of its key markets
during what will be an environment of weak demand and economic
uncertainty.
The negative outlook reflects the considerable operating challenges
and downside risk that Ford will face through 2021 while
implementing its restructuring plan and attempting to restore its
competitive position in the face of the coronavirus pandemic.
Moody's forecasts for the global automotive sector anticipates a
20% decline in unit shipments during 2020. In Ford's core US
market, the rating agency anticipates a 25% decline for the full
year, with a steep year-over year contraction in the second and
third quarters, followed a modest rebound in the fourth quarter.
During 2021 industry unit sales should rebound by approximately
11%. However, future demand for vehicles could be weaker than its
current estimates, the already competitive environment in the auto
sector could intensify further, and Ford could encounter greater
than expected headwinds in executing the Fitness Redesign
initiative.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ford's rating could be downgraded if the company is unable to
establish a clear trajectory for achieving the following metrics
after 2020: automotive EBITA margin exceeding 3%; EBITA/interest
exceeding 2x; and, solidly positive automotive free cash flow.
Ford's performance in several areas will be important indicators of
its ability to establish this trajectory, including: 1) maintaining
a full-year 2020 automotive cash burn that does not materially
exceed $8 billion; 2) successfully launching new F-150 and Bronco
models; and, 3) demonstrating that the Fitness Redesign initiative
is narrowing the competitive and operating gap versus peers.
While there is limited chance of an upgrade for several years, the
rating could be raised if Ford's trajectory for 2022 performance
reflects: EBITA margin approximating 5%; EBITA/interest over 3.5x;
and, free cash flow exceeds $2.5 billion.
Ford's liquidity position is very strong as it faces the current
crisis, and is reflected in the Speculative Grade Liquidity Rating
of SGL-1. To better contend with a weakening demand outlook, Ford
has eliminated it $2.4 billion annual dividend, drawn the full
amount available under its $15.4 billion in bank credit facilities,
and issued $8 billion of senior unsecured notes. Based on these
actions, the company's pro forma March 31, 2020 cash position is
$42 billion. This level of cash is more than adequate to cover
major requirements through 2021. These requirements include a cash
burn that Moody's expects will approximate $8 billion in 2020 and
$3 billion in 2021, and the approximately $10 billion in cash
(Moody's estimate) needed to fund any potential future unwind of
Ford's negative working capital position. Although the recent
increases in debt will cause Ford's leverage metrics to rise (with
debt/EBITDA approaching 10x by year-end 2020), the negative impact
is mitigated by the buildup in cash liquidity, and by the enhanced
capacity to cover the large cash needs that will exist until the
impact of the pandemic begins to abate.
Ford has been focused on addressing environmental risks and will
remain a priority in its strategic planning. Even so, Ford's
current product line-up puts the company at risk for potentially
large emission penalties in 2020 and 2021. In response, Ford's new
product launch will include a number of battery electric and full
hybrid vehicles as important contributors in Ford's ability to
comply with increasingly challenging emission regulations in the US
and Europe. However, customer acceptance and Ford's ability to earn
an economic return on them are uncertain. The rapid and widening
spread of the coronavirus outbreak, and the deteriorating global
economic outlook are affecting many sectors, and the global
automotive industry is one of the most severely impacted.
Consequently, Moody's believes that Ford's vehicle sales will be
highly vulnerable to pronounced shifts in market sentiment and
consumer demand in these unprecedented operating conditions.
Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety.
The following rating actions were taken:
Confirmations:
Issuer: Ford Motor Company
Corporate Family Rating, Confirmed at Ba2
Probability of Default Rating, Confirmed at Ba2-PD
Senior Unsecured Bank Credit Facility, Confirmed at Ba2 (LGD4)
Senior Unsecured Conv./Exch. Bond/Debenture, Confirmed at
Ba2 (LGD4)
Senior Unsecured Regular Bond/Debenture, Confirmed at Ba2 (LGD4)
Issuer: Ford Holdings, Inc.
Senior Unsecured Regular Bond/Debenture, Confirmed at Ba2 (LGD4)
Outlook Actions:
Issuer: Ford Motor Company
Outlook, Changed To Negative From Rating Under Review
Issuer: Ford Holdings, Inc.
Outlook, Changed To Negative From Rating Under Review
The methodologies used in these ratings were Automobile
Manufacturer Industry published in June 2017.
Ford Motor Company, based in Dearborn, Michigan, is a global
automotive manufacturer with operations in North America, South
American, Europe, Africa and the Middle East, China and the broad
Asia Pacific region. For the twelve months ending December, 2019,
total automotive revenues were about $144 billion.
FORD MOTOR: Moody's Confirms Ba2 LT Senior Unsecured Rating
-----------------------------------------------------------
Moody's Investors Service confirmed its ratings for Ford Motor
Credit Company LLC and its subsidiaries, including the Ba2
long-term senior unsecured rating. The Not Prime short-term ratings
were affirmed. The outlook is negative. These actions conclude the
review for downgrade initiated on March 25, 2020, which was driven
by the uncertainty around the company's operating performance
related to the rapid global spread of the coronavirus outbreak.
The rating actions follow similar actions on the ratings for Ford
Credit's parent, Ford Motor Company (Ford, Ba2 corporate family
rating, negative).
The rapid and widening spread of the coronavirus outbreak, the
deteriorating global economic outlook and falling oil prices are
creating a severe and extensive credit shock across many sectors,
regions and markets. Moody's believes that delinquency rates, loan
defaults and lease residual realization trends will worsen in the
next 12-18 months. Moody's believes, however, that US auto captive
finance companies are fairly well positioned to weather a level of
shock in the system absent meaningful declines in used car prices
and a rapid and unexpected deterioration of liquidity at the parent
level. Moody's regards the coronavirus outbreak as a social risk
under its environmental, social and governance framework, given the
substantial implications for public health and safety.
Confirmations:
Issuer: Ford Motor Credit Company LLC
Senior Unsecured Regular Bond/Debenture (Local Currency),
Confirmed at Ba2
Senior Unsecured Regular Bond/Debenture (Foreign Currency),
Confirmed at Ba2
Senior Unsecured Shelf, Confirmed at (P)Ba2
Senior Unsecured Medium-Term Note Program (Local Currency),
Confirmed at (P)Ba2
Senior Unsecured Medium-Term Note Program (Foreign Currency),
Confirmed at (P)Ba2
Backed Senior Unsecured Medium-Term Note Program, Confirmed
at (P)Ba2
Subordinate Shelf, Confirmed at (P)Ba3
Issuer: FCE Bank plc
Senior Unsecured Bank Credit Facility, Confirmed at Ba2
Senior Unsecured Medium-Term Note Program (Foreign Currency),
Confirmed at (P)Ba2
Senior Unsecured Regular Bond/Debenture (Local Currency),
Confirmed at Ba2
Senior Unsecured Regular Bond/Debenture (Foreign Currency),
Confirmed at Ba2
Issuer: Ford Credit Canada Company
123456789012345678901234567890123456789012345678901234567890123456
Backed Senior Unsecured Medium-Term Note Program (Local
Currency), Confirmed at (P)Ba2
Backed Senior Unsecured Medium-Term Note Program (Foreign
Currency), Confirmed at (P)Ba2
Senior Unsecured Regular Bond/Debenture, Confirmed at Ba2
Backed Senior Unsecured Regular Bond/Debenture, Confirmed
at Ba2
Backed Senior Unsecured Shelf, Confirmed at (P)Ba2
Affirmations:
Issuer: Ford Motor Credit Company LLC
Commercial Paper, Affirmed NP
Backed Commercial Paper, Affirmed NP
Other Short Term (Local Currency), Affirmed (P)NP
Other Short Term (Foreign Currency), Affirmed (P)NP
Issuer: FCE Bank plc
Backed ST Deposit Note Program (Foreign Currency), Affirmed NP
Commercial Paper (Foreign Currency), Affirmed NP
Other Short Term (Foreign Currency), Affirmed (P)NP
Issuer: Ford Credit Canada Company
Backed Commercial Paper, Affirmed NP
Outlook Actions:
Issuer: Ford Motor Credit Company LLC
Outlook, Changed to Negative from Rating Under Review
Issuer: FCE Bank plc
Outlook, Changed To Negative From Rating Under Review
Issuer: Ford Credit Canada Company
Outlook, Changed To Negative From Rating Under Review
RATINGS RATIONALE
The confirmation of Ford Credit's ratings reflects Moody's
unchanged assessment of the company's ba2 standalone assessment and
affiliate support from Ford.
Ford Credit's unchanged ba2 standalone assessment takes into
consideration the company's well managed portfolio asset quality,
adequate capital cushion that protects its creditors against
unexpected losses, and good liquidity supported by the operating
model. Ford Credit's tangible equity to tangible assets capital
cushion was 8.6% as of March 31, 2020 and Moody's expects it will
remain close to 9.0% over the next 12-18 months. Ford Credit is the
only firm in Moody's rated auto captive portfolio that has a
relatively limited lease portfolio (20% of managed assets as of
March 31, 2020) making it less vulnerable to a rapid decline of
used car prices. Moody's expects that Ford Credit's net receivables
($137 billion as of March 31, 2020) will decline by approximately
10% in 2020, which is in line with its expectations of new car
sales decline in the U.S. by 25%. This assumes that the company
will maintain a penetration rate of around 60%, broadly in line
with historical figures. Moody's believes that Ford Credit will
manage its debt to equity leverage to within its historical range
of 8x to 9x (9.2x as of March 31, 2020). Other credit challenges
for Ford Credit include its exposure to the performance trends of
its parent and its significant use of securitization, which Moody's
believes will increase in the current environment. An increased use
of securitization increases the amount of encumbered assets,
reducing the company's alternate sources of liquidity.
Ford Credit's liquidity position is good and totaled $28 billion as
of March 31, 2020, comprising $8.4 billion of cash (net of $2.9
billion of cash reserves held for ABS facilities), $17.3 billion
from committed asset backed facilities, and $2.3 billion under
other unsecured credit facilities ($3bn capacity).
Ford Credit's ba2 standalone assessment is line with the rating of
its parent Ford. The negative outlook on Ford Credit was prompted
by similar actions taken on the ratings for its ultimate parent
Ford. Ford's weaker credit profile will have negative implications
for Ford Credit's access to funding and its financing volumes.
Ford's support to Ford Credit is evidenced by a support agreement
under which Ford Credit can require Ford to inject capital to
restore leverage below an 11.5x debt to equity threshold, should
Ford Credit exceed the threshold.
Moody's regards the coronavirus pandemic as a social risk under its
ESG framework, given the substantial implications for public health
and safety. Please see Moody's Environmental risks and Social risks
heatmaps for further information. Its rating actions reflect the
impact on Ford Credit of the breadth and severity of the shock, and
Moody's view of its ability to withstand it under its current
assumptions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The negative outlook indicates that ratings upgrades are unlikely
over the next 12-18 months. However, the ratings could upgrade if
the ratings for Ford are upgraded.
A material declines in asset quality and profitability beyond
Moody's current expectations, diminished liquidity, or leverage
(TCE/TMA) to less than 8% could lead to lower standalone assessment
for Ford Credit. Ford Credit's ratings could be downgraded if
Ford's ratings are downgraded.
The methodologies used in these ratings were Finance Companies
Methodology published in November 2019.
FREEDOM OIL: Access to Cash Collateral Allowed on Interim Basis
---------------------------------------------------------------
Judge David Jones of the U.S. Bankruptcy Court for the Southern
District of Texas authorized Freedom Oil & Gas, Inc. and its
affiliates to use cash collateral in accordance with the terms and
conditions provided in the Interim Order to pay the expenses
contained in the budget.
Pursuant to the Pre-Petition Loan Documents, the Debtors owed Wells
Fargo Bank, N.A., as administrative agent, and the Secured Lender
the aggregate amount of not less than $17,925,104. The Pre-Petition
Indebtedness is secured by valid, binding, perfected and
enforceable liens and security interests upon and in property of
the Debtors whether then owned or thereafter acquired or arising,
including all proceeds and products thereof.
As adequate protection for, and to secure payment for the aggregate
diminution in value of its interest, Wells Fargo, on behalf of the
Secured Lender, is granted the following: (a) valid, automatically
perfected and enforceable additional first priority adequate
protection replacement liens upon all of each Debtor's now-owned
and after-acquired real and personal property, assets and rights;
and (b) an allowed superpriority administrative expense claim, as
provided and to the full extent allowed by sections 503(b) and
507(b) of the Bankruptcy Code.
About Freedom Oil & Gas Inc
Freedom Oil & Gas, Inc., together with its subsidiaries, operates
as an oil and gas exploration and production company. Based in
Houston, Texas, the Company has established an acreage position in
the oil-rich portion of the Eagle Ford shale in South Texas, in
Dimmitt County.
Freedom Oil & Gas along with five affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No.
20-32582) on May 11, 2020. The Petition was signed by Russell J.
Porter, president. The case is assigned to Judge David R. Jones.
At the time of filing, Freedom Oil & Gas had $1 million to $10
million in assets and $10 million to $50 million in liabilities.
Matthew Okin, Esq., at OKIN ADAMS LLP, serves as the Debtors'
general bankruptcy counsel; and JOHNSON RICE & COMPANY is the
Debtors' brokerage & investment banking firm.
FREEDOM OIL: Enters Bankruptcy as Revenues Plunge
-------------------------------------------------
Paul Takahashi of Houston Chronicle reports that Houston-based oil
and gas company Freedom Oil and Gas, formerly called Maverick
Drilling, becmae the the newest victim of the oil crash as it
sought Chapter 11 bankruptcy protection.
According to Freedom, it was unable to pay its debt of over $10
million as revenues plunged during the global coronavirus pandemic.
It plans to sell all corporate assets to Australian environmental
services company Sendero Resources, pending approval from the
bankruptcy court.
Freedom joins other U.S. energy companies that have filed for
bankruptcy protection as the pandemic spurred a historic collapse
of the oil industry collapse. The pandemic, which has forced
businesses to temporarily close and consumers to stay home, has
decreased the demand for oil and gas products, thereby causing
prices to plummet.
About Freedom Oil and Gas
Freedom Oil & Gas, Inc., formerly Maverick Drilling & Exploration
Limited, operates as an oil and gas exploration and production
company. Based in Houston, Texas, the Company has established an
acreage position in the oil-rich portion of the Eagle Ford shale in
South Texas, in Dimmitt County.
Freedom Oil & Gas, Inc., and its affiliates sought Chapter 11
protection (Bankr. S.D. Tex. Case No. 20-32582) on May 11, 2020.
Freedom Oil & Gas was estimated to have $1 million to $10 million
in assets and $10 million to $50 million in liabilities as of the
bankruptcy filing.
The Hon. David R. Jones is the case judge..
The Debtors tapped OKIN ADAMS LLP as bankruptcy counsel; and
JOHNSON RICE & COMPANY as investment banker.
FREEDOM OIL: July 10 Auction of Substantially All Assets Set
------------------------------------------------------------
Judge David R. Jones of the U.S. Bankruptcy Court for the Southern
District of Texas authorized the bidding procedures of Freedom Oil
& Gas, Inc. and affiliates in connection with the sale of
substantially all of their oil and gas assets, including, but not
limited to, interests in oil and gas leases, wells, related
inventory and equipment, and various personal property, to Sendero
Resources, LLC, doing business as Orednes, LLC, for $4,274,000,
subject to overbid.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: no later than 5:00 p.m. (CT) on July 6, 2020
b. Initial Bid: Each bid must identify the upfront cash
consideration to be paid for the Assets. The Purchase Price may
not be less than an amount equal to $4,675,000. The Initial
Overbid is calculated as the sum of: (a) $4,274,000 (cash portion
of the Base Purchase Price as defined in the Stalking Horse APA);
(b) $278,220 (the aggregate contingent amount of the Stalking Horse
Purchaser's Bid Protections); and (c) additional cash consideration
of $122,780.
c. Deposit: 10% of the total Purchase Price
d. Auction: In the event that the Debtors timely receive two
or more Qualifying Bids, including the Stalking Horse Purchaser's
bid, the Debtors will conduct the Auction on July 10, 2020 at 10:00
a.m. (CT) at the law offices of Okin Adams LLP, 1113 Vine Street,
Suite 240, Houston, Texas 77002, or an alternate location
(including by telephone or videoconference) designated in advance
by the Debtors with notice to the Agent and Qualifying Bidders.
e. Bid Increments: $125,000
f. Sale Hearing: July 14, 2020, at 10:00 a.m. (CT)
g. Sale Objection Deadline: 5:00 p.m. (CT) on July 6, 2020
The Sale Notice is approved. The Debtors will provide the Sale
Notice to the Sale Notice Parties.
The Cure Notice is approved. The Contract Objection Deadline is
July 6, 2020 at 5:00 p.m. (CT).
The Hard Consent Notice is approved. The Debtors will cause the
Hard Consent Notice to be served to any Hard Consent Holders not
later than five days after entry of the Bidding Procedures Order.
The Hard Consent Objection Deadline is July 6, 2020 at 5:00 p.m.
(CT).
Upon the consummation of a sale of all or substantially all of the
Assets to any Successful Bidder other than the Stalking Horse
Purchaser, the Debtors will pay the Stalking Horse Purchaser,
solely from the proceeds of such sale to the Successful Bidder, the
Bid Protections in immediately available funds in an amount equal
to the Break-Up Fee plus actual, reasonable Expense Reimbursement
not to exceed $150,000.
The Bid Protections and the Good Faith Deposit will be paid by the
Debtors to the Stalking Horse Purchaser in accordance with the
Stalking Horse APA via wire transfer from immediately available
funds immediately following the closing of the alternate sale
transaction contemplated by the Successful Bid with any other
Successful Bidder (but in no event later than two business days
following the closing of such alternate sale transaction), and will
be paid by the Debtors to the Stalking Horse Purchaser prior to the
payment of the proceeds of such Sale to any third party asserting a
lien on the Assets (and no lien of any third party will attach to
the portion of the Sale proceeds representing the Bid Protections).
Notwithstanding the possible applicability of Bankruptcy Rules
6004(h), 7062, 9014 or otherwise or any Bankruptcy Local Rules of
the Court, the terms and conditions of the Bidding Procedures Order
will be immediately effective and enforceable upon its entry. All
time periods set forth in the Bidding Procedures Order will be
calculated in accordance with Bankruptcy Rule 9006(a).
A copy of the Bidding Procedures is available at
https://tinyurl.com/yckvp7q7 from PacerMonitor.com free of charge.
About Freedom Oil & Gas
Located at 5151 San Felipe, Suite 800, Houston, Texas, Freedom Oil
& Gas, Inc., together with its subsidiaries, operates as an oil and
gas exploration and production company. Based in Houston, Texas,
the Company has established an acreage position in the oil-rich
portion of the Eagle Ford shale in South Texas, in Dimmitt County.
Freedom Oil & Gas, Inc. (Bankr. S.D. Tex. Case No. 20-32582), and
its affiliates Freedom Eagle Ford, Inc. (Bankr. S.D. Tex. Case No.
20-32583), Freedom Production, Inc. (Bankr. S.D. Tex. Case No.
20-32584), Freedom Oil & Gas USA, Inc. (Bankr. S.D. Tex. Case No.
20-32585), Maverick Drilling Company, Inc. (Bankr. S.D. Tex. Case
No. 20-32586), and Maverick Production Company, Inc. (Bankr. S.D.
Tex. Case No. 20-32587), sought Chapter 11 protection on May 11,
2020.
In the petitions signed by Russell J. Porter, president, CEO, and
secretary, Freedom Oil & Gas, Freedom Oil & Gas USA, Freedom Eagle
Ford, and Freedom Production each estimated assets in the range of
$1 million to $10 million, and $10 million to $50 million in debt.
Maverick Drilling's and Maverick Production's each estimated assets
and liabilities in the range of $0 to $50,000.
The cases are assigned to Judge David R. Jones.
The Debtors tapped Matthew Okin, Esq., at Okin Adams LLP, as their
general bankruptcy counsel. They tapped Johnson Rice & Co. as
their brokerage & investment banking firm.
FRONTIER COMMUNICATIONS: Hires Evercore Group as Investment Banker
------------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Evercore Group L.L.C. as their investment
banker and financial advisor.
The services that Evercore will provide are:
a. reviewing and analyzing the Debtors' businesses,
operations, and financial projections;
b. advising and assisting the Debtors in a Bank Amendment,
Liability Management Transaction, In-Court Restructuring, Financing
and/or Sale, if the Debtors determine to undertake such a
Transaction;
c. providing financial advice in developing and implementing a
Transaction, including:
i. evaluating Transaction alternatives and the financial
implications on the Debtors' capital structure and financial
condition;
ii. assisting the Debtors in structuring and effecting any
Transaction;
iii. advising the Debtors on tactics and strategies for
negotiating with various stakeholders regarding any Transaction;
iv. assisting the Debtors in developing a restructuring plan
or plan of reorganization, including a plan of reorganization
pursuant to the Bankruptcy Code (any such plan, a Restructuring
Plan);
v. providing testimony, as necessary, with respect to
matters on which Evercore has been engaged to advise the Debtors
before any court exercising jurisdiction over the Debtors,
including in any proceeding under the Bankruptcy Code that is
pending before such court; and
vi. providing the Debtors with other financial restructuring
advice as the Parties may deem appropriate;
d. if the Debtors pursue a Financing, assisting the Debtors
in:
i. if Evercore does not serve as the placement agent or
similar function on such Financing:
(1) assisting the Debtors in preparing marketing
materials for such Financing;
(2) identifying potential placement agents or
underwriters and assisting the Debtors in negotiating the terms of
the placement agents' and/or underwriters' engagements;
(3) evaluating the terms of a Financing;
(4) assisting the Debtors and the appointed placement
agent in negotiating and executing a Financing;
(5) providing the Debtors with other financial advice as
the Parties may deem appropriate; and
ii. if Evercore serves as the placement agent or similar
function on such Financing:
(1) structuring and effecting a Financing;
(2) identifying potential Investors and, at the
Debtors' request, contacting such Investors; and
(3) working with the Debtors in negotiating with
potential Investors; and
e. if the Debtors pursue a Sale, including a Sale of all or
substantially all of the Debtor's operations located in the states
of Washington, Oregon, Idaho and Montana to WDC Management, LLC,
assisting the Debtors in:
i. structuring and effecting a Sale;
ii. identifying interested parties and/or potential
acquirors and, at the Debtors' request, contacting such interested
parties and/or potential acquirors; and
iii. working with the Debtors in connection with negotiations
with potential interested parties and/or acquirors and aiding in
the consummation of a Sale transaction.
Evercore will be compensated as follows:
a. A monthly fee of $250,000, payable on execution of the
Engagement Letter and on the first day of each month commencing May
1, 2019 until the earlier of the consummation of an In-Court
Restructuring or the termination of Evercore's engagement;
provided, however, that so long as Monthly Fees for months one
through twelve have actually been earned and paid, 50 percent of
the Monthly Fee for months one through twelve shall be credited
(without duplication) against any Liability Management Transaction
Fee or In-Court Restructuring Fee (each as defined below) payable;
provided, that any such credit of fees contemplated by this
sentence shall apply only to the extent that all fees earned by
Evercore are approved in their entirety by the Court pursuant to a
final order not subject to appeal and which order is acceptable to
Evercore.
b. A fee of $35 million, payable upon the confirmation of a
Restructuring Plan of any In-Court Restructuring.
c. A fee of $16.5 million, payable after entry of the Order
and upon consummation of a WDC Sale, for which fee applications
will be subsequently filed. Fees for any other asset sale shall be
negotiated in good faith and consistent with the compensation
customarily paid to investment bankers of similar standing acting
in similar situations
d. A fee (Financing Fee), payable upon consummation of any
Financing and incremental to any other fees earned, equal to:
i. if Evercore serves as the placement agent or similar
function on such Financing, the applicable percentage(s) of the
aggregate amount of capital committed, whether or not drawn or
funded (the Gross Proceeds), as set forth in the table below
(provided, however, that, if Evercore serves as the placement agent
on a Financing, the Parties will enter into an appropriate form of
agreement relating to the type of transaction involved and
containing customary terms and conditions, including provisions
relating to Evercore's indemnity):
Financing As a Percentage of Financing
Gross Proceeds
Indebtedness Secured
by a First Lien 1.00%
Indebtedness Secured
by a Junior Lien 1.25%
Unsecured and/or
Subordinated
Indebtedness 1.75%
Equity or Equity-linked
Securities/Obligations 3.00%
ii. if Evercore does not serve as the placement agent or
similar function on such Financing, 35 percent of the applicable
fee percentages set forth in Section 2(f)(i) of the Engagement
Letter; provided, however, that so long as such Financing Fee under
Section 2(f)(ii) of the Engagement Letter has actually been earned
and paid, 35 percent of such Financing Fee shall be credited
(without duplication) against any Liability Management Transaction
Fee or In-Court Restructuring Fee payable in connection with the
underlying Financing; provided, further, that any such credit of
fees contemplated by this sentence shall apply only to the extent
that all fees earned by Evercore are approved in their entirety by
the Court pursuant to a final order not subject to appeal and which
order is acceptable to Evercore.
Notwithstanding the foregoing, in connection with any DIP Financing
offered to the Debtors, the Debtors shall pay Evercore a fee of the
greater of $3 million or 0.5 percent of the Gross Proceeds of the
DIP Financing (the DIP Financing Fee), payable in full upon the
execution of a commitment letter or other similar document in
respect of such financing.
e. In addition to any fees that may be payable to Evercore
and, regardless of whether any transaction occurs, the Debtors
shall promptly reimburse to Evercore:
i. all reasonable expenses (including travel and lodging,
data processing and communications charges, courier services, and
other appropriate expenditures); and
ii. other documented reasonable fees and expenses, including
expenses of counsel, if any.
f. If Evercore provides services to the Debtors (and the
Debtors have requested that Evercore provide such services) for
which a fee is not provided herein, such services shall, except
insofar as they are the subject of a separate agreement, be treated
as falling within the scope of the Engagement Letter, and the
Parties will agree upon a fee for such services
based upon good faith negotiations, subject to Court order.
g. In addition, the Parties acknowledge and agree that more
than one fee may be payable to Evercore under subparagraphs 2(b),
2(c), 2(d), 2(e), and/or 2(f) of the Engagement Letter in
connection with any single transaction or a series of transactions,
it being understood and agreed that if more than one fee becomes so
payable to Evercore in connection with a series of transactions,
each such fee shall be paid to Evercore.
h. If an In-Court Restructuring, Sale, and/or Financing is to
be completed, in whole or in part, through a pre-arranged
Restructuring Plan (i) 50 percent of the aggregate amount of any
In-Court Restructuring Fee, Sale Fee, and Financing Fee, as
applicable, shall be earned and shall be payable upon obtaining
support (e.g., via a term sheet, restructuring support agreement,
or other agreement in principle documenting the key terms of such
prearranged Restructuring Plan) from one or more of the Debtors'
key creditor classes that is sufficient to justify filing such
pre-arranged Restructuring Plan and (ii) the remainder of such fees
shall be earned and shall be payable upon confirmation of such
Restructuring Plan; provided, further, that in the event that
Evercore is paid a fee in connection with a pre-arranged
Restructuring Plan, and such Restructuring Plan is not thereafter
consummated, then such fee previously paid to Evercore may be
credited by the Debtors against any subsequent fee hereunder that
becomes payable by the Debtors to Evercore. For the avoidance of
doubt, this paragraph shall not apply to an In-Court Restructuring,
Sale, and/or Financing not completed, in whole or in part, through
a pre-arranged Restructuring Plan.
Evercore is a "disinterested person" within the meaning of section
101(14) of the Bankruptcy Code, as required by section 327(a) of
the Bankruptcy Code, and does not hold or represent an interest
materially adverse to the Debtors' estates; and has no connection
to the Debtors, their creditors or other parties in interest in
these chapter 11 cases, according to court filings.
The firm can be reached through:
Roopesh Shah
EVERCORE GROUP L.L.C.
EVERCORE PARTNERS INTERNATIONAL LLP
55 East 52 nd Street
New York, NY 10055
Tel: (212) 857-3100
Fax: (212) 857-3101
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Hires Kirkland & Ellis as Legal Counsel
----------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as their legal counsel.
Frontier requires Kirkland & Ellis to:
a. advise the Debtors with respect to their powers and duties
as debtors in possession in the continued management and operation
of their businesses and properties;
b. advise and consult on the conduct of these chapter 11
cases, including all of the legal and administrative requirements
of operating in chapter 11;
c. attend meetings and negotiating with representatives of
creditors and other parties in interest;
d. take all necessary actions to protect and preserve the
Debtors' estates, including prosecuting actions on the Debtors'
behalf, defending any action commenced against the Debtors, and
representing the Debtors in negotiations concerning litigation in
which the Debtors are involved, including objections to claims
filed against the Debtors' estates;
e. prepare pleadings in connection with these chapter 11
cases, including motions, applications, answers, orders, reports,
and papers necessary or otherwise beneficial to the administration
of the Debtors' estates;
f. represent the Debtors in connection with obtaining
authority to continue using cash collateral and postpetition
financing;
g. advise the Debtors in connection with any potential sale of
assets;
h. appear before the Court and any appellate courts to
represent the interests of the Debtors' estates;
i. advise the Debtors regarding tax matters;
j. take any necessary action on behalf of the Debtors to
negotiate, prepare, and obtain approval of a disclosure statement
and confirmation of a chapter 11 plan and all documents related
thereto; and
k. perform all other necessary legal services for the Debtors
in connection with the prosecution of these chapter 11 cases,
including: (i) analyzing the Debtors' leases and contracts and the
assumption and assignment or rejection thereof; (ii) analyzing the
validity of liens against the Debtors; and (iii) advising the
Debtors on corporate and litigation matters.
Kirkland & Ellis will be paid at these hourly rates:
Partners $1,075-$1,845
Of Counsel $625-$1,845
Associates $610- $1,165
Paraprofessionals $245 to $460
Stephen E. Hessler, Esq., the president of Stephen E. Hessler,
P.C., a partner of Kirkland & Ellis LLP, and a partner of Kirkland
& Ellis International LLP, assured the Court that the firm is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code and does not represent any interest adverse to
the Debtors and their estates.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Mr.
Hessler disclosed that the firms have not agreed to a variation of
their standard billing arrangements for their employment with the
Debtors, and that no professional at the firms has varied his rate
based on the geographic location of the Debtors' bankruptcy cases.
The attorney also disclosed that the hourly rates used by Kirkland
in representing the Debtors are consistent with the rates that
Kirkland charges other comparable chapter 11 clients, regardless of
the location of the chapter 11 case.
Kirkland represented the Debtors during the 12-month period before
the Petition Date, using its standard hourly rates for 2019.
Mr. Hessler also disclosed that the Debtors have already approved
the firms' budget and staffing plan for the period April 14, 2020
through August 14, 2020.
The firm can be reached at:
Stephen E. Hessler, Esq.
Kirkland & Ellis LLP
Kirkland & Ellis International LLP
601 Lexington Avenue
New York, NY 10022
Tel: (212) 446-4800
Fax: (212) 446-4900
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Hires Wilkinson Barker as Special Counsel
------------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Wilkinson Barker Knauer, LLP as their special
counsel.
Wilkinson will continue to provide legal services to the Debtors
with respect to FCC and state PUC regulatory matters.
Wilkinson's standard hourly rates for 2020 are:
Partners $450 to $970
Of Counsel $440 to $560
Associates $295 to $380
Legal Assistants $135 to $250
Other Professionals $230 to $790
William F. Maher, Jr., a partner of Wilkinson, assured the Court
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtors and their estates.
Wilkinson Barker can be reached at:
William F. Maher, Jr., Esq.
WILKINSON BARKER KNAUER, LLP
1800 M Street, NW, Suite
Washington, DC 20036
Tel: (202) 383-3429
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Hires Willkie Farr as Legal Counsel
------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Willkie Farr & Gallagher LLP as their legal
counsel.
Frontier Communications requires Willkie Farr to:
(a) prepare, on behalf of the Debtors, as debtors in
possession, all necessary motions, applications, answers, orders,
reports and papers in connection with the administration of these
cases;
(b) counsel the Debtors with regard to their rights and
obligations as debtors in possession in the continued operation of
their businesses and the management of their estates;
(c) provide the Debtors with advice, represent the Debtors and
prepare all necessary documents on behalf of the Debtors in the
areas of corporate finance, employee benefits, real estate, tax and
bankruptcy law, commercial litigation, debt restructuring and asset
dispositions in connection with their restructuring efforts;
(d) attend meetings and negotiating with representatives of
the creditors and other parties in interest;
(e) advise the Debtors in connection with any potential asset
sales;
(f) assist with any necessary actions on behalf of the Debtors
to negotiate, prepare and obtain approval of a disclosure statement
and confirmation of a chapter 11 plan and all documents related
thereto;
(g) advise the Debtors with respect to actions to protect and
preserve the Debtors’ estates during the pendency of these cases,
including the prosecution of actions by the Debtors, the defense of
actions commenced against the Debtors, negotiations concerning
litigation in which the Debtors are involved and objections to
claims filed against the estates; and
(h) perform all other necessary or requested legal services in
connection with these chapter 11 cases, including, without
limitation, any general corporate and litigation legal services.
The firm's hourly rates range from $1,175-$1,700 for partners and
senior counsel; $390-$1,150 for associates, other attorneys and law
clerks; and $265-$435 for paraprofessionals.
The current hourly rates for the Willkie attorneys and
paraprofessionals are:
Brian S. Lennon, Partner $1,450
Agustina Berro, Associate $1,050
Alison R. Ambeault, Associate Director $435
John Kaelin, Paralegal $265
Brian S. Lennon, Esq., a partner at Willkie Farr, disclosed in
court filings that the firm is "disinterested" as defined in
Section 101(14) of the Bankruptcy Code.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Mr.
Lennon disclosed that his firm has not agreed to a variation of its
standard or customary billing arrangements for its employment with
the Debtors, and that no Willkie Farr professional has varied his
rate based on the geographic location of the Debtors' bankruptcy
cases.
Mr. Lennon also disclosed Willkie Farr did not represent the
Debtors in the twelve-month period prior to the Petition Date and
that the Debtors have already approved the firm's budget and
staffing plan for the period of April 14, 2020 through May 31,
2020.
Willkie Farr can be reached through:
Brian S. Lennon, Esq.
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019
Tel: (212) 728-8000
Fax: (212) 728-8111
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Seeks to Hire PwC as Tax Advisor
---------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire PricewaterhouseCoopers LLP as tax and other tax
related advisory services provider.
Frontier Communications requires PwC to:
a. Research and Development Tax Credit - Exam Assistance
Engagement Letter
i. provide advisory service and assistance regarding the
Debtors' credits for Increasing Research Activities under Internal
Revenue Code (IRC) Section 41 and research tax credits under
applicable Texas state authorities;
ii. meet with tax authority examiners;
iii. present documentation for years ended December 31,
2013-2018;
iv. describe the procedures used to identify and document
the Debtors' Qualified Research Activities and Expenditures for
years ended December 31, 2013-2018 or other years if requested by
the exam team; and
v. help the Debtors draft and assist with coordinating an
effective audit.
b. 2020 Tax Provision Review Engagement Letter
i. assist the Debtors with their analysis of the
consolidated financial statement tax accrual for the year and
quarters ended March 31, 2020, June 30, 2020, September 30, 2020,
December 31, 2020;
ii. review roll-forward of balance sheet accounts
(provisions/benefits, payments, refunds, true-ups, changes in any
tax reserve, etc.) and review selected items for agreement to the
general ledger;
iii. review activity in balance sheet tax accounts;
iv. review U.S. and state provisions;
v. review significant transactions that occurred during
that period; and
vi. review tax reserves and providing observations for
management's consideration.
c. Indirect Tax Process Engagement Letter
i. build an Indirect Tax Process workflow model for the
sales and telecommunications taxes compliance process;
ii. participate in meetings and white-boarding sessions with
the Debtors' tax team, biller team, IT and/or other personnel to
obtain information and data as they pertain to the billing and
compliance process;
iii. build workflow inputs based on data from 13 billing
environments, Vertex, and other tax or bulling data aggregation
sources;
iv. build workflow validations, control tables,
reconciliation process checks, summaries and similar functionality
as mutually agree with the Debtors;
v. create necessary output files or tax return support in
the requisite format to be used for compliance filings purposes,
for both internal and third party filed returns;
vi. perform testing and validations of final output files
and make appropriate updates; and
vii.transition knowledge and train the Debtors' personnel on
how to run and maintain the workflow model for each monthly
compliance run.
d. 2018 Return Review Engagement Letter
i. provide advice and/or assessment regarding the potential
implications of the 2017 tax reform and reconciliation act or other
related reporting requirements;
ii. provide advice, answers to the questions on federal,
state and local, and international tax matters, including research,
discussions, preparation of memoranda, and attendance at meetings
relating to such matters, as mutually determined to be necessary;
and
iii. provide advice and/or assistance with respect to matters
involving the Internal Revenue Service or other tax authorities on
an as-needed or as requested basis.
e. Research and Development Engagement Letter
i. compute the eligible amount of federal research credits
and Section 174 Research and Experimental Expenditures deduction
for the Debtors for the tax years December 31, 2019;
ii. present to Debtors' management a presentation regarding
the findings; and
iii. complete the steps laid out in the "documentation and
calculation" section and the "deliverables" included in the
Engagement Letter, including Credit Summary, Credit Calculations,
QRE Summary, QRE Summary by State, QRE Detail, Executive Summary
Memo, and Qualified Research Documentation.
PwC will charge the following hourly rates:
General Tax R&D Tax Provision
Tax Recurring
Advisory Services Return Review
Services
Partner/Principal $810-$915 $656 $757
$924
Managing Director $790-$915 n/a n/a
$824
Director $785-$835 $618 $710
$803
Senior Manager $730-$745 n/a $633
$735
Manager $635-$715 $515 $608
$688
Senior Associate $485-$600 n/a $510
$588
Experienced Associate $335-$455 $310 $387
$425
Associate and Staff $225-$245 $310 $208
$425
Brian Goldstein, partner of PricewaterhouseCoopers LLP, assured the
Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtors and their estates.
PricewaterhouseCoopers can be reached at:
Brian Goldstein
PRICEWATERHOUSECOOPERS LLP
300 Madison Avenu
New York, NY 10017
Tel: (647) 471-3000
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Taps Carlin Adrianopoli of FTI as EVP
--------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Carlin Adrianopoli, FTI Consulting, Inc.'s
senior managing director, as Executive Vice President of Strategic
Planning.
Services FTI and Mr. Adrianopoli will render are:
1. Review established cash forecasting and liquidity
management and assist with future liquidity management, including,
without limitation, the development of a 13 or 26 week cash
forecast;
2. Analyze the Debtors's near-term cash obligations, including
debt service requirements, capital expenditures and working capital
requirements;
3. Assist the Debtors and existing outside advisors hired by
the Debtors, in the refinement and further development of a
business plan, which would be shared with creditors, investors, and
regulatory authorities in discussions concerning proposals
regarding terms of potential forbearances, amendments,
modifications and/or restructuring/reorganization of the Debtors's
existing indebtedness or other financial obligations;
4. Work with the Debtors and its advisors in the preparation,
design, and presentation of proposals to creditors, investors, and
regulatory authorities regarding terms of potential forbearances,
amendments, modifications, and/or restructuring/reorganization of
the Debtors's existing indebtedness or other financial
obligations;
5. Assist in the development and evaluation of any employee
compensation and reorganization plans, if needed;
6. Assist the Debtors in responding to due diligence requests
from lenders, other creditors, lessors, vendors, other
professionals, investors and regulatory authorities;
7. Attend meetings, presentations and negotiations as may be
requested by the Debtors;
8. Provide certain asset sale services, including assisting
with data collection and information gathering related to third
party due diligence, and advising and assisting the Debtors and
other professionals in developing, negotiating, and executing sales
of the Debtors' assets;
9. Provide periodic status reports to senior management
(including the Chief Transaction Officer), the Board (and shall
report directly to the Committee), and the other advisors with
respect to the progress of the overall engagement, as requested;
10. Analyze and evaluate the likelihood of cost savings
initiatives;
11. In the event that the Debtors requires contingency
planning:
a. Work with senior management to determine what areas of
the business will be assisting in providing critical information;
b. Work closely and discretely with the designated parties
to ensure that accurate and timely data is used in the filing
documents;
12. In the event the Debtors commences in-court chapter 11
cases, assist the Debtors and its advisors in the preparation of
any required financial disclosures including, but not limited to,
the preparation of schedules of assets and liabilities, statement
of financial affairs, monthly operating reports or any other
similar period reports, and any necessary or required financial
disclosures in connection with any disclosure statement and/or
chapter 11 plan;
a. Assist the Debtors in the valuation of their businesses
in the preparation of a liquidation valuation and financial
projections for a reorganization plan and/or negotiation purposes;
b. Assist the Debtors in managing and executing the claims
reconciliation process;
c. Provide testimony in the chapter 11 proceedings, as
necessary; and
d. Develop timelines and milestones for the designated
parties to achieve the target dates.
13. Evaluate customer initiatives and analytics;
14. Provide various analytical support to the Debtors's finance
staff, including operationalizing the business plan and recasting
financial statements;
15. Analyze the Debtors's video strategy and content costs;
16. Assist the Debtors in developing and analyze customer
lifetime value analyses;
17. Support the Debtors's efforts to optimize its sales
channels;
18. Support the Debtors's cost reduction efforts, including the
Field Ops Microbattle teams and other oversight;
19. Provide certain technology services, as described in the
Addendum, including, but not limited to, data receipt, staging and
processing; database management; case management; production
support; preparation, and delivery; and on-going professional
services;
20. Estimate the fair market value of certain legal
subsidiaries as will be directed by the Debtors to be used for
internal planning purposes to facilitate meeting tax filing
requirements; and
21. Other services as may be reasonably requested by the
Debtors, and as may be customary in this type of engagement.
The current hourly rates for the FTI Professionals are:
Senior Managing Directors $920 to $1,295
Directors/Senior Directors/Managing Directors $690 to $905
Consultants/Senior Consultants $370 to $660
Administrative/Paraprofessionals $150 to $280
Mr. Adrianopoli, a senior managing director of FTI, 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:
Carlin Adrianopoli
FTI CONSULTING INC.
Three Times Square, 9th Floor
New York, NY 10036
Telephone: (214) 384-4909
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Taps CMA Strategy as Telecom Consultant
----------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Communications Media Advisors, LLC, d/b/a CMA
Strategy Consulting, to serve as the Debtors' telecom services
consultant.
Communications Media has and will continue rendering the following
telecom consulting services:
a. finalizing base case assumptions and summary model
structure, which consists of:
i. developing alignment around summary model format and
level of granularity (state level, driver details, assumption set,
etc.);
ii. finalizing base case model assumptions and outputs; and
iii. assisting in the development of a monthly and quarterly
budget over a twelve-month horizon that mirrors the base case
results;
b. developing a simplified base case model structure and
assessing real-time impact of operational and financial results on
the Debtors' forecasts;
c. developing a detailed analysis of the reinvestment case,
which primarily consists of:
i. developing a detailed set of capital expenditures and
financial forecasts based on granular market analysis;
ii. developing a reinvestment case that focuses only on
Residential Fiber to Home Acceleration (FTTP) to model deployment
costs and adoptions of FTTP services;
iii. developing a reinvestment case focused on FTTP in
addition to Commercial Fiber to the Business Acceleration and
Wholesale Fiber to the Tower; and
iv. recommending which reinvestment case to include in a
summary model;
d. creating a simplified model of the reinvestment scenario,
with associated documentation explaining input report sources, for
the Debtors to use and/or share with their advisors;
e. creating an investor-oriented, summary presentation on the
different models;
f. building a complete fact base around the Debtors' entire
wholesale circuit customer base (both wireline and wireless
backhaul);
g. developing a specific strategy that maximizes the value of
the Debtors' current wholesale base while supporting growth in the
business;
h. providing ad hoc analyses and negotiation support as the
Debtors engage with their wholesale customers;
i. developing detailed models describing the Debtors' DSL and
FTTP economics in rural areas covered by RDOF, as well as a
detailed, outside-in wireless Internet service provider deployment
model;
j. analyzing potential competitive bidders given final RDOF
rules and providing support to the Debtors' with respect to the
RDOF auction, including rapid response model adjustments and side
analyses to evaluate potential alternative strategies;
k. developing an updated model for the deployment of FTTP
services, including build cost estimates, marketing and sales
costs, installation costs, take rates, and average revenue per user
assumptions, with such model aligned to the Debtors' current
financial forecasts, cost structure, and reporting;
l. using model outputs to identify clusters of opportunity for
the deployment of FTTP services at various internal rate of return
hurdle rates within the Debtors' service areas in each state;
m. developing a detailed staging and prioritization plan, that
accounts for the Debtors' existing capital structure and cash
constraints, for the various state deployments and incorporating
such plan into a full financial model and forecast;
n. identifying potential alternative funding sources (e.g.,
infrastructure funds, project financing, co-investment joint
ventures) for fiber investment projects and supporting the Debtors
in diligence requests from such sources and/or strategic acquirers;
and
o. completing any ad hoc tasks requested by the Debtors.
Communications Media's fees are:
Fixed Fee Fixed Fee
Outstanding
Restructuring
Engagement Letter $360,000 $0
Wholesale
Engagement Letter $375,000 $0
Involvement RDOF
Engagement Letter $680,000 $0
Fiber Engagement
Letter $700,000 $300,000
Total: $2,115,000 $300,000
CMA is a "disinterested person" within the meaning of section
101(14) of the Bankruptcy Code and does not hold or
represent an interest adverse to the Debtors' estates, according to
court filings.
The firm can be reached through:
Nicholas Vantzelfde
Communications Media Advisors, LLC
101 Federal St, Suite 1000
Boston, MA 02110
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Taps Cravath Swaine as Special Counsel
---------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Cravath, Swaine & Moore LLP as their special
counsel.
On May 29, 2019, the Debtors announced that they had entered into
an agreement to sell their operations in Idaho, Montana, Oregon and
Washington to Northwest Fiber, LLC. Cravath has provided advice and
assistance with respect to the Northwest Sale since the beginning
of the transaction process, and it continues to assist the Debtors
in various matters related to the closing of the Northwest Sale. In
addition, from time to time, Cravath has represented the Debtors
with other matters.
The Debtors require and will continue to require Cravath's services
with respect to the Northwest Sale, and such other new, discrete
matters that may arise during these chapter 11 cases. Cravath will
also be able to provide the Debtors and their restructuring
advisors with knowledge and expertise regarding historical matters
and issues that may affect the Debtors' chapter 11 cases.
The current hourly billing rates for Cravath professionals expected
to spend significant time on the engagement range from $1,170 to
$1,725 for partners and of counsel, $635 to $1,210 for associates,
and $310 to $395 for paralegals.
Paul Zumbro, Esq., a partner at Cravath, disclosed in a court
filing that his firm is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Mr.
Zumbro disclosed that his firm has not agreed to any variations
from, or alternatives to, its standard or customary billing
arrangements; and that no Cravath professional has varied his rate
based on the geographic location for the Debtors' cases.
Cravath represented the Debtors during the twelve-month period
before the Petition Date, using the hourly rates listed below:
Billing Category Range
Partners and
Of Counsel $1,100-$1,725
Associates $595-$1,210
Paraprofessionals $290-$395
The firm, in conjunction with the Debtors, is developing a
prospective budget and staffing plan for their cases, according to
Mr. Zumbro.
Cravath can be reached through:
Paul H. Zumbro, Esq.
Cravath, Swaine & Moore LLP
Worldwide Plaza
825 Eighth Avenue
New York, NY 10019
Tel: (212) 474-1000
Fax: (212) 474-3700
E-mail: pzumbro@cravath.com
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Taps Delta Partners as Business Consultant
-------------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Delta Partners Corp. to serve as their business
and marketing consultants.
Services Delta will render are:
1. Marketing Engagement Letter
a. Understand the current complexity of the base, which
consists of:
i. map the complexity in the base products, bundles, and
price points
ii. identify the variables that could help to identify
clusters (e.g., existing product/Geo/competitiveness/household
income proxy/tenure/speed); and
iii. create a view of the profitability at the customer
level, including video
b. identify simplification opportunity, which consists of:
i. identify the "no-regret move" base portfolio
simplification opportunity and strategy (e.g., convergence to small
portfolio with credit adjustment);
ii. define the target portfolio, based on existing
portfolio and price points; and
iii. assess the economic impact of the migration at the
customer level/cluster level under different scenarios.
c. support the migrations implementation, which consists
of:
i. provide the analytics support to test the migration
campaign and verify the assumptions (ARPU, churn);
ii. measure the progress of the base simplification;
iii. provide the analytics to support the regulatory
filing (voice only).
2. Churn Engagement Letter
d. Key Activities
i. update the monthly churn dashboards;
ii. accelerate the creation of the monthly dashboard
iii. review and align the definition of key indications
iv. segment the customer base using a star rating
v. identify the improvement opportunity for fault
repair.
e. Key Deliverables
i. Monthly churn dashboard
ii. analyze leveraging the existing sandbox, including
channel, credit, and faults;
iii. provide star rating for the customer base; and
iv. provide any other further analysis as required by
the CEO.
The Debtors have agreed to pay Delta Partners $722 per hour per
Delta Partners employee for their services. Notwithstanding the
hourly rate set out above, Delta Partners has agreed that Delta
Partners' fees for the Services provided pursuant to the Churn
Engagement Letter shall be subject to a weekly cap of $87,000.
Christophe Meunier, Senior Partner of the firm of Delta Partners
Corp., assures the court that the firm is a "disinterested person,"
as defined in section 101(14) of the Bankruptcy Code and as
required by section 327(a) of the Bankruptcy Code.
The firm can be reached through:
Christophe Meunier
Delta Partners Corp.
Media One, Level 29
P.O. Box 502428
Dubai Media City
United Arab Emirates
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Taps Ernst & Young to Provide Tax Services
-------------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire Ernst & Young LLP as valuation, accounting, and
tax services provider.
EY LLP will render these services
A. Valuation Services
i. General Procedures
EY LLP anticipates performing the following procedures
and tasks in its valuation analysis:
a. Perform interviews with Management concerning the
nature of the identified tangible and intangible assets and the
reporting units of Frontier ("Reporting Units");
b. Consider any business plans, future performance
estimates or budgets for Frontier;
c. Give consideration to applicable economic, industry,
and competitive environments, including relevant historical and
future estimated trends;
d. Give consideration to the guidance on fair value
measurements and market participant assumptions contained in ASC
820; and
e. Apply the Income, Market, and/or Cost Approaches to
value using, where appropriate, financial data that is based on a
market participant perspective.
ii. Personal Property
EY LLP anticipates performing the following procedures
and tasks in its valuation analysis of the personal property assets
of Frontier:
a. Fair value analysis for the following personal
property asset categories:
1. Communication services equipment; and
2. Administrative assets (related to corporate,
sales, and backoffice operations).
iii. Real Property
EY LLP anticipates performing certain procedures and
tasks in its valuation analysis of the real property assets of
Frontier (all of which are located in the continental U.S.).
iv. Intangible Assets
EY LLP anticipates performing the following procedures
and tasks in its valuation analysis of the intangible assets of
Frontier:
a. Interview Management and review documentation in
order to assist Frontier in its identification of the significant
intangible assets of Frontier.
v. Reporting Units
EY LLP anticipates performing certain procedures and
tasks in its valuation analysis of the business enterprise of the
Reporting Units.
vi. Deliverables
EY LLP will deliver to Frontier a Report consisting of
an electronic PDF copy of its detailed valuation schedules
supporting its fair value analysis for the Assets and Reporting
Units (the "Valuation"). The Valuation will be based on methods and
techniques that EY LLP considers appropriate under the
circumstances.
B. Accounting Services
i. The scope of EY LLP's Accounting Services will primarily
focus on assisting Frontier with general and technical accounting
matters related to Frontier's financial reporting and documentation
of various accounting matters and policies, as well as providing
assistance with the accounting impact of emergence from bankruptcy
to allow Frontier to apply fresh-start accounting in accordance
with ASC 852 reorganizations.
ii. In connection with the Accounting Services, EY LLP may
engage in discussions with Frontier's personnel, including officers
and employees, and outside consultants, as determined by Frontier.
EY LLP may also read documentation, including contracts and
memoranda, as specified by Frontier. Further, EY LLP may identify
factors or considerations that are relevant to Frontier's analysis
of identified accounting and financial reporting matters.
iii. As part of the Accounting Services, EY LLP may assist
Frontier in interpreting the relevant accounting and reporting
literature based on Frontier's general circumstances and provide EY
LLP's views on those factors (including Frontier's characteristics
and structure) which may influence the choice of Frontier's
accounting policy. EY LLP will not conclude on the appropriate
accounting treatment based on specific facts or recommend which
accounting policy/treatment Frontier should select/adopt. Any
observations EY LLP provides are intended to assist Frontier as it
reaches, documents, and implements its own conclusions and will not
constitute EY LLP's concurrence with, or support of, Frontier's
proposed accounting or reporting.
iv. EY LLP may also provide Frontier's personnel, at
Frontier's request, with general training sessions on certain
accounting and financial reporting topics.
v. At Frontier's request, EY LLP will provide Frontier with
certain written Reports.
vi. EY LLP may, upon Frontier's written request, assist
Frontier in documenting the conclusions Frontier has reached or
positions Frontier has taken on accounting and reporting matters,
including the accounting policies Frontier selects. EY LLP will not
provide any formal branded written Reports (including, without
limitation, any opinions) during or upon conclusion of the
Accounting Services.
vii. The Debtors will be responsible for implementing and
further customizing these Reports, and for its use thereof and
their effectiveness. EY LLP will have no obligation with respect
thereto.
Tax Routine On-Call Advisory Services SOW
As set forth in detail in the Tax Routine On-Call Advisory Services
SOW, EY LLP will provide the following routine tax advisory
services and assistance concerning issues or projects as requested
by Frontier when such issues or projects are not covered by a
separate Statement of Work and do not involve any significant tax
planning or projects, as well as the following one-off tax
compliance services upon Frontier's written request:
A. On-Call Tax Advisory Services
i. The scope of the On-Call Tax Advisory Services to be
performed pursuant to the Tax Routine On-Call Advisory Services SOW
may be agreed to orally or through written communications with
Frontier such as e-mails.
ii. The On-Call Tax Advisory Services covered by the Tax
Routine On-Call Advisory Services SOW include assistance with tax
issues by answering oneoff questions, drafting memos describing how
specific tax rules work, assisting with general transactional
issues, and assisting Frontier in connection with its dealings with
tax authorities (other than representing Frontier in an examination
or an appeal before the IRS or other taxing authority).
iii. Specific tasks that may be involved in connection with
the services include the
following: participating in meetings and telephone calls with
Frontier; participating in meetings and telephone calls with taxing
authorities and other third parties where EY LLP is not
representing Frontier in an examination or an appeal before the
taxing authority; reviewing transaction-related documentation;
researching technical issues; and preparing technical memoranda,
letters, e-mails, and other written documentation.
iv. The Tax Routine On-Call Advisory Services SOW is not
intended to cover services related to significant tax planning or
other projects where a mutual understanding of the scope of the
engagement should be formally documented. Accordingly, separate
Statements of Work generally will be entered into in connection
with such services, including but not limited to the following:
services related to a transaction that is a reportable transaction,
transaction of interest or transaction similarly designated by a
tax authority; engagements where EY LLP will render formal opinions
or opinions that will be relied upon by third parties; studies with
respect to Frontier's tax attributes (e.g., basis studies or
repairs and maintenance studies); loaned or assigned staff
engagements; and due diligence engagements.
B. On-Call Tax Compliance Services
i. The scope of On-Call Tax Compliance Services will be
agreed to through written communications with Frontier such as an
exchange of e-mails.
ii. The On-Call Tax Compliance Services covered by the Tax
Routine On-Call Advisory Services SOW include, upon Frontier's
written request, the preparation of estimated tax computations and
related vouchers and requests for extensions of tax return due
dates, and the one-off preparation of sales, use, excise, and
property tax returns.
iii. Separate Statements of Work generally will be entered
into for engagements when EY LLP prepares or reviews income tax
returns, entries on income tax returns, Reports of Foreign Bank and
Financial Accounts (FBARs / FinCEN Form 114), or when EY LLP will
prepare sales, use, excise and property tax returns on a continuing
basis.
EY LLP will be paid at these hourly rates:
Partner/Managing Director $650
Senior Manager $530
Manager $425
Senior $325
Staff $200
Michael Mayone, a partner at Ernst & Young LLP, disclosed in court
filings that the firm is a "disinterested person" within the
meaning of Section 101(14) of the Bankruptcy Code, as modified by
Section 1107(b) of the Bankruptcy Code.
The firm can be reached through:
Michael Mayone
Ernst & Young, LLP
5 Times Square,
Direct: +1 212 773 3000
Fax: +1 212 773 6350
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FRONTIER COMMUNICATIONS: Taps KMPG to Provide Tax Advisory Services
-------------------------------------------------------------------
Frontier Communications Corporation and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to hire KPMG LLP to provide audit, tax compliance, and
tax consulting services.
KPMG has agreed to provide these services:
A. Audit Services.
a. perform audit of consolidated balance sheets of the
Debtors as of December 31, 2020 and 2019, the related consolidated
statements of operations, comprehensive loss, equity deficit, and
cash flows for each of the years in the three-year period ending
December 31, 2020, and the related notes to the financial
statements and audit of internal control over financial reporting
as of December 31, 2020;
b. quarterly review procedures for the quarters ending
March 31, 2020, June 30, 2020, and September 30, 2020;
c. perform audit of the balance sheet of Citizens Utilities
Rural Company, Inc., a wholly owned subsidiary of Frontier
Communications Corporation, as of December 31, 2019, the related
statements of operations, comprehensive income, equity (deficit),
and cash flows for the year ended December 31, 2019, and the
related notes to the financial statement;
d. perform audit of the balance sheet of Frontier West
Virginia, Inc., a wholly owned subsidiary of the Debtor, as of
December 31, 2019, the related statements of operations,
comprehensive income, equity (deficit), and cash flows for the year
ended December 31, 2019, and the related notes to the financial
statement (the "WV Audit");
e. provide Debtors a subscription to KPMG's Accounting
Research Online, an online library of accounting, auditing, and
financial reporting literature and related guidance, and the
automated Accounting Disclosure; and
f. perform procedures (the "Audit Out-of-Scope Services")
in connection with emergence from bankruptcy, including but not
limited to:
i. debt-restructuring, accounting considerations during
and on emergence from bankruptcy, fresh-start accounting, valuation
of assets and liabilities on emergence from bankruptcy, income tax
matters arising as a result of bankruptcy, or other debt
restructuring
activities as a result of bankruptcy;
ii. procedures in connection with significant non-routine
and/or complex transactions or other scope changes (e.g., new
audit/accounting standards requiring incremental effort,
acquisitions or dispositions, significant deficiencies or material
weaknesses, pension settlements, ineffective general information
technology controls, national office consultations, etc.).
B. Tax Compliance Services.
a. preparation of state and local transaction tax returns
and supporting schedules for the reporting periods, January 2020 to
December 2020, for certain Debtors and jurisdictions as identified
in the relevant Engagement Letter;
b. signing of the tax returns as tax preparer;
c. preparation of tax returns for any state or local
jurisdictions and additional majority owned legal entities not
previously identified in the applicable Engagement Letter,
including any newly controlled legal entities formed or acquired by
the Debtors during the engagement period, and that the Debtors
approve in writing;
d. responses to routine correspondence received from tax
authorities associated with the tax returns prepared by KPMG;
e. preliminary engagement planning activities related to
the tax returns specified above for the immediately succeeding tax
year;
f. perform compliance services including but not limited to
the following:
i. non-routine notices;
ii. gross receipts tax return preparation;
iii. custom report development or processing;
iv. ad-hoc information requests;
v. data translation or rule changes;
vi. manual importation of data;
vii. data corrections or data moves;
viii. amended returns; and
ix. data and return retrieval requests; and
g. perform services regarding additional entities requiring
client setup/implementation or any required transition services.
C. General Tax Consulting Services.
a. provision of general tax consulting on matters that may
arise for which the Debtors may seek KPMG's advice, both written
and oral;
b. preliminary engagement planning activities undertaken
prior to the issuance of a separate engagement letter for a
discrete tax consulting project, when, in the course of providing
general tax consulting services, it is determined that a discrete
tax consulting project is necessary; and
c. address non-routine notices regarding matters for
registration inquiries, business licenses, request for information,
and any tax return filed prior to KPMG's engagement with the
Debtors.
D. Restructuring Tax Consulting Services.
a. KPMG will continue to provide analysis as to the
federal, state, and local tax implications of these chapter 11
cases, to the extent the Debtors request. The analysis includes,
but is not limited to, the following:
i. analysis of any 26 U.S.C. Sec. 382 issues related to
any potential restructuring alternatives, including sensitivity
analysis to reflect the 26 U.S.C. Sec. 382 impact of proposed
and/or hypothetical equity transactions;
ii. analysis of "net unrealized built-in gains and
losses," the proposed regulation under 26 U.S.C. Sec. 382(h), and
Notice 2003-65 as applied to the ownership change, if any,
resulting from or in connection with the chapter 11 cases;
iii. review of the Debtors' tax attributes including, but
not limited to, net operating losses, tax basis in assets, and tax
basis in stock of subsidiaries as relevant to the chapter 11
cases;
iv. analysis of cancellation of debt income, including
the application of 26 U.S.C. Sec. 108 and consolidated tax return
regulations relating to the restructuring of non-intercompany debt
and the completed capitalization/settlement of intercompany debt;
v. analysis of the application of the attribute
reduction rules under 26 U.S.C. Sec. 108(b) and 26 C.F.R. Sec.
1.1502-28, including a benefit analysis of 26 U.S.C. Sec. 108(b)
(5) and 101 7(b)(3)(D) elections as related to the chapter 11
cases;
vi. analysis of the tax implications of any internal
reorganizations and proposal of restructuring alternatives;
vii. cash tax modeling of the tax benefits or tax costs of
restructuring alternatives;
viii. analysis of the tax implications of any dispositions
of assets and/or subsidiary stock pursuant to the chapter 11
cases;
ix. analysis of potential bad debt, worthless stock, and
retirement tax losses associated with the chapter 11 cases;
x. analysis of any proof of claims from tax
authorities;
xi. analysis of the tax treatment of restructuring
related costs; and
xii. federal, state, or local tax implications of any of
the items referenced above or any other matters related to the
Debtors' chapter 11 proceedings.
KPMG and the Debtors have agreed to a fixed fee of $4,950,000 for
the Audit Services, assuming KPMG receives 1,500 hours of internal
audit assistance and successfully achieves 500 hours of audit
efficiencies in coordination with Debtors' management.
Approximately $850,000 of the Audit Services Fee for 2020 was paid
prepetition on April 1, 2020.
Tax Compliance Fixed Fee are:
Standard Monthly Compliance Rate Frequency
Per Return Rate $32.50 Per return
Data Received Late 20% of current Per instance
month's fees
Additional Services $350 Per
registration
and renewal
requested
The majority of the fees to be charged for the General Tax
Consulting Services, Restructuring Tax Consulting Services, and
out-of-scope services will be billed at these hourly rates,
reflecting a reduction of 30 percent from KPMG's normal and
customary hourly rates:
Partners/Principals $868 - $966
Managing Directors $868 - $896
Senior Managers $784 - $840
Managers $616 - $742
Senior Associates $448 - $602
Associates $336 - $364
Para-Professionals $238 - $294
KPMG is a "disinterested person" within the meaning of section
101(14) of the Bankruptcy Code, and does not hold or represent an
interest adverse to the Debtors' estates.
The firm can be reached through:
Howard Steinberg
KPMG LLP
1350 Avenue of the Americas
New York, NY 10019
Tel: +1 212 997 0500
Fax: +1 212 730 6892
About Frontier Communications
Frontier Communications Corporation (NASDAQ: FTR) offers a variety
of services to residential and business customers over its
fiber-optic and copper networks in 29 states, including video,
high-speed internet, advanced voice, and Frontier Secure digital
protection solutions.
Frontier Communications Corporation and 103 related entities sought
Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on
April 14, 2020. Judge Robert D. Drain oversees the cases.
Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as
financial advisor; and FTI Consulting, Inc., as restructuring
advisor. Prime Clerk is the claims agent, maintaining the page
http://www.frontierrestructuring.com/and
https://cases.primeclerk.com/ftr
The U.S. Trustee for Region 2 appointed a committee to represent
unsecured creditors in Debtors' Chapter 11 cases.
FURIE OPERATING: Further Fine-Tunes Disclosure Statement
--------------------------------------------------------
Furie Operating Alaska, LLC, et al., submitted a Second Amended
Disclosure Statement.
On May 8, 2020, the Bankruptcy Court approved the Disclosure
Statement as containing adequate information.
Based on the claims filed in the Chapter 11 cases, the aggregate
amount of general unsecured debt as of the Petition Date is in
excess of $43.8 million. Based on the Debtors' initial review of
Claims filed prior to the Claims Bar Date, the difference between
this amount and the Debtors' estimate of $8.2 million is largely
attributable to Disputed General Unsecured Claims. The Debtors are
in the process of reconciling the Debtors' books and records with
such Claims, however, the Debtors may not complete their
reconciliation prior to the Hearing or, if the Plan is confirmed,
the Effective Date.
Holders of Class 4 Prepetition Term Loan Claims each will receive
its share of (i) $20.5 million of the New Term Loan Debt and (ii)
100% of the Litigation Trust Interests, provided that any
recoveries on the proceeds of the Litigation Trust will first be
used to mandatorily repay and permanently reduce the obligations
under the New Term Loan which shall be distributed in each case in
accordance with the Prepetition Term Loan Lender Payment Priority
Waterfall set forth in the Final DIP Order.
In no event will any holder of a Prepetition Term Loan Claim
receive an aggregate recovery on account of such proceeds in excess
of the amount of such holder's Prepetition Term Loan Claim,
Holders of Allowed General Unsecured Claims will receive no
recovery.
A red-lined copy of the Second Amended Disclosure Statement dated
May 6, 2020, is available at https://tinyurl.com/yb94qrmt from
PacerMonitor.com at no charge.
Counsel to the Debtors:
Timothy W. Walsh
Riley T. Orloff
MCDERMOTT WILL & EMERY LLP
340 Madison Avenue
New York, New York 10173-1922
Telephone: (212) 547-5400
Facsimile: (212) 547-5444
E-mail: twwalsh@mwe.com
rorloff@mwe.com
- and -
Matthew P. Ward
Ericka F. Johnson
WOMBLE BOND DICKINSON (US) LLP
1313 North Market Street, Suite 1200
Wilmington, Delaware 19801
Telephone: (302) 252-4320
Facsimile: (302) 252-4330
E-mail: matthew.ward@wbd-us.com
ericka.johnson@wbd-us.com
About Furie Operating Alaska
Headquartered in Anchorage Alaska, Furie Operating Alaska LLC and
its affiliates operate as independent energy companies primarily
focused on the acquisition, exploration, production, and
development of offshore oil and gas properties in the State of
Alaska's Cook Inlet region. They hold a majority working nterest in
35 competitive oil and gas leases in the Cook Inlet. Additionally,
they wholly own and operate an offshore production platform in the
middle of the Cook Inlet to extract natural gas under the oil and
gas leases.
Furie Operating Alaska and its affiliates, Cornucopia Oil & Gas
Company LLC, and Corsair Oil & Gas LLC, filed voluntary petitions
for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del.
Case Nos. 19-11781 to 19-11783) on Aug. 9, 2019. In the petitions
signed by Scott M. Pinsonnault, interim COO, the Debtors were
estimated to have $10 million to $50 million in assets and $100
million to $500 million in liabilities.
The Debtors tapped Womble Bond Dickinson (US) LLP and McDermott
Will & Emery LLP as legal counsel; Seaport Global Securities LLC as
investment banker; and Ankura Consulting Group as financial
advisor. Prime Clerk LLC is the claims and noticing agent, and
administrative advisor.
GARDEN FRESH: Files for Chapter 7 as Buffet Restaurants Shuttered
-----------------------------------------------------------------
Ben Coley, writing or QSR Magazine, reports that Garden Fresh
Restaurants, the parent of buffet-style concept Souplantation and
Sweet Tomatoes, filed a Chapter 7 bankruptcy petition after
shutting all 97 restaurants.
According to the report, Garden Fresh, a self-service chain famous
for 50-foot salad bar breads, desserts, pastas, and soups, opted to
file Chapter 7 bankruptcy, hence it will surrender and will
liquidate its assets and will permanently close locations.
Garden Fresh finds it hard and challenging to continue its
operations due to the coronavirus pandemic and the increased safety
concerns of consumers. For these reasons, the U.S. Food and Drug
Administration recommended Green Fresh to discontinue its
operations because its food and beverage service stations require
customers to use dispensers and common utensils.
"As you may have heard, we are unable to re-open our 97
Souplantation and Sweet Tomatoes restaurants due to the COVID-19
pandemic," the company wrote online. "The outpouring of love on
social media has been overwhelming and we are so grateful to all of
the sweet memories you have shared. We would like to thank our
4,400 team members for their dedication and love they have shown to
our local communities. We will miss you tremendously and wish you
the best of luck."
It considered applying for the Paycheck Protection Program loan but
decided against it because big chains such as J. Alexander's,
Ruth's Chris Steak House and Potbelly were heavily criticized for
applying and receiving the forgivable PPP loans. The federal
government later released guidance that discouraged big
corporations from applying the PPP. Companies that accepted the
loans prior to the release of the new rulings were essentially told
to return the funds or face consequences.
According to CEO John Haywood, prior to COVID-19, the traffic in
Garden Fresh was rising and its stores underwent renovations but
its sales declined the moment dining rooms were ordered to close.
He said that Garden Fresh cannot offer takeout services because
there wasn't any path to reopening. Before the pandemic, Garden
Fresh was burning more than $1 million per week, with annual sales
reaching $250 million per year.
Robert Allbritton, chairman of Perpetual Capital Partners, told the
San Diego Tribune that he wrote a $2.5 million check over a month
ago to help cover payroll for the approximately 4,400 employees.
About Garden Fresh Restaurants
Founded in 1978 and headquartered in San Diego, CA, Garden Fresh
owns of 123 Souplantation and Sweet Tomatoes restaurants across 15
states. Garden Fresh has 5,500 employees, approximately 5,000 of
whom are employed on an hourly basis.
Garden Fresh Restaurant Intermediate Holding, LLC, and its
affiliates filed Chapter 11 petitions (Bankr. D. Del. Case Nos.
16-12174 to 16-12178) on Oct. 3, 2016. In the bankruptcy case, the
Debtors hired Morgan, Lewis & Bockius LLP as general counsel;
Young, Conaway, Stargatt & Taylor, LLP as local counsel; Piper
Jaffray Companies as financial advisor; and Epiq Bankruptcy
Solutions, LLC as claims and noticing agent.
Garden Fresh Restaurants LLC filed a petition for Chapter 7
liquidation (Bankr. S..D. Cal. Case No. 20-02477) on May 14, 2020.
The company reported assets between $50 million and $100 million
and liabilities of similar range. The Hon. Louise Decarl Adler is
the presiding judge.
The Debtor's counsel in the Chapter 7 case:
Gary B. Rudolph
Sullivan Hill Rez & Engel, Aplc
Tel: 619-233-4100
E-mail: rudolph@sullivanhill.com
GCI LLC: Moody's Assigns B2 Corp. Family Rating
-----------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating,
B2-PD Probability of Default rating, and SGL-2 liquidity rating to
GCI, LLC, the obligor of all Moody's rated debt, following
continued strong unencumbered asset coverage that, despite recent
market disruption, is approximately 4.4x debt. Strong unencumbered
asset coverage is a key credit factor that provides about 1 notch
of lift to the CFR. Moody's assigned a stable outlook to GCI, LLC.
Moody's also affirmed the Ba2 rating on the senior secured bank
credit facility at GCI Holdings, Inc. and the B3 rating on the
senior unsecured notes at GCI Liberty, Inc.
The Ba2 rating on the senior secured bank credit facility at GCI
Holdings, Inc. and the B3 rating on the senior unsecured notes at
GCI Liberty, Inc. will be transferred in the near term to GCI, LLC,
which is the legal obligor under these obligations. The B2 CFR,
B2-PD PDR, and SGL-1 ratings of GCI Liberty, Inc. were withdrawn.
Assignments:
Issuer: GCI, LLC
Corporate Family Rating, Assigned B2
Probability of Default Rating, Assigned B2-PD
Speculative Grade Liquidity Rating, Assigned SGL-2
Affirmations:
Issuer: GCI Holdings, Inc.
Senior Secured Bank Credit Facility, Affirmed Ba2 (LGD2)
Issuer: GCI Liberty, Inc.
Senior unsecured notes, Affirmed B3 (LGD5)
Withdrawals:
Issuer: GCI Liberty, Inc.
Corporate Family Rating, Withdrawn, previously rated B2
Probability of Default Rating, Withdrawn, previously rated B2-PD
Speculative Grade Liquidity, Withdrawn, previously rated SGL-1
Outlook Actions:
Issuer: GCI, LLC
Outlook, Assigned Stable
Issuer: GCI Liberty, Inc.
Outlook, Changed to No Outlook, From Stable
Issuer: GCI Holdings, Inc.
Outlook, Changed to No Outlook, From Stable
RATINGS RATIONALE
GCI, LLC's credit profile reflects governance considerations,
including a financial policy that tolerates high leverage of
approximately 5.6x (Moody's adjusted, LTM), and periodic
distributions to its parent. These governance risks are mitigated
by GCI's track record of maintaining substantial unencumbered asset
primarily through its direct and indirect investment in Charter
Communications. The company's indentures require these investments
to be at least $3 billion to allow for restricted payments. This
substantial base of unencumbered assets provides significant credit
support, equivalent to approximately 1 notch of lift to the CFR.
The assets securing the credit facility have small operational
scale with regional concentration in Alaska which has experienced a
weak economy including very low oil prices. Strong competition in
all of its markets, as well a secular decline in pay-TV video and
wireline voice, also weigh on operating performance, which has
contributed to a decline in subscriber counts and penetration
rates. Regulatory risks are also a negative credit factor, with a
significant percentage of revenue (near 24%) derived from
government subsidies and regulated pricing. As a result of recent
issues, including unfavorable and unpredictable changes in rates
billed, the company has experienced high loss rates and
extraordinary slow collection cycles which has led to significant
working capital deficits. As a result, and in combination with the
capital-intensive nature of the business and interest burden, the
company has become dependent on external financing, primarily using
is margin loan capacity at Liberty Broadband, to cover its
variability in cash flows.
Supporting the credit profile is a base of recurring revenue from
its position as a leading communications provider in the Alaskan
market with significant market share in each of its products,
including full ownership of Alaska's largest wireless network. GCI
is a dominant Quad-player with a quality network. Strong broadband
demand drivers support stable to modest organic revenue growth in
data services, and support good EBITDA margins in the mid 30%
range.
Social risk is also a consideration. The rapid and widening spread
of the coronavirus outbreak, deteriorating global economic outlook,
falling oil prices, and asset price declines are creating a severe
and extensive credit shock across many sectors, regions and
markets. The combined credit effects of these developments are
unprecedented. Moody's regards the coronavirus outbreak as a social
risk under its ESG framework, given the substantial implications
for public health and safety. Moody's believes telecommunication
service providers generally have less exposure than many other
sectors, and expect increased demand for voice, video and data
during the current crisis are likely to temporarily improve
operating performance metrics. Video viewership and engagement are
rising sharply, with subscribers spending an extraordinary amount
of time watching TV for news and entertainment comfort with the
complete shut-down of US cinemas. Broadband data demand has
increased significantly, and usage is more evenly distributed with
the sudden and very sharp rise in remote workers. Most of the US
workforce (excluding essential, front-line workers) are now using
their internet full-time, for voice, data, and video
communications. Additionally, online commerce and remote learning
are drawing significant demand for communication services. Moody's
realizes there will be significant disruption to direct selling,
on-premise installations and service, payments from residential and
small and medium sized businesses, advertising, certain programming
(sports and new production / content), and operations (component
supply chains, construction / network upgrades). However, Moody's
expects any temporary negative implications will most likely to
partially or fully offset by the favorable effects of the
pandemic.
GCI's SGL-2 speculative grade liquidity rating reflects a good
liquidity profile supported by cash balances of approximately $97
million, solid availability of at least $275 million under the $550
million revolver, ample head-room under loan covenants, and very
substantial alternate liquidity based on the value of unencumbered
assets that Moody's estimates is over $6 billion, net of margins
loans.
The Ba2 (LGD2) rated senior secured bank credit facility (including
the Term Loan B and Revolving Credit Facility) at GCI Holdings,
Inc. (a wholly owned subsidiary of GCI Liberty, Inc.), rank ahead
of GCI's senior unsecured indebtedness which is contractually
subordinate. Senior unsecured debt is rated B3 (LGD5), one notch
below the B2 CFR, reflecting its junior claim relative to the
senior secured bank facility. Instrument ratings incorporate a
B2-PD and an expectation of an average recovery in bankruptcy (e.g.
50%) given the mixed capital structure, with both senior and junior
claim priorities. In an actual default scenario, the
instrument-level ratings could change based on the potential
outcomes (e.g. bankruptcy versus liquidation) and a detailed
analysis of valuation relative to claim-by-claim asset coverage and
recoveries. Lease rejection claims and trade payables are
insignificant to instrument ratings given their small claim sizes
relative to funded debt.
The stable outlook reflects its expectation that debt, revenues,
and EBITDA will average approximately $1.6 billion, $890 million,
and $315 million, respectively over the next 12-18 months. Moody's
projects EBITDA margins in the mid 30% range. Net of capital
spending (with capex to revenue averaging near 15%) and the burden
of interest expense (equal to near 8.5% of debt, including the
margin loan), Moody's expects free cash flow to range between $75
million positive to negative over the next 12-18 months, depending
on swings in working capital which is highly variable due to
unpredictable government collection cycles. Its revenue projections
assume subscribers will fall, driven by losses in video, voice, and
wireless with some temporary improvement in loss rates through
2020. Moody's expects key credit metrics to be inside its
tolerances over the next 12 months, and liquidity to remain good.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if debt/ EBITDA (Moody's adjusted) is
sustained below 4.5x times at the restricted group, and asset
coverage of debt held by GCI's subsidiaries (excluding the assets
held by the GCI operating company) remains strong and supported by
a contractual provision in the Company's debt agreements. A
positive rating action would also be considered if the Company's
liquidity significantly improved, there were favorable and
semi-permanent changes in regulations, or operating performance
improves significantly.
The ratings would face downward pressure if debt/EBITDA (Moody's
adjusted) is sustained above 5.5x (at the restricted group), or
asset coverage of debt held by GCI's unrestricted subsidiaries
falls below 2.0x. A negative rating action would also be considered
if liquidity deteriorated, parental support was less certain,
Moody's anticipated the possibility of a material and adverse
change in regulation, or operating performance worsened.
GCI owns and operates interests in a broad range of communications
businesses. Its principal operating asset is a leading integrated,
facilities-based communications provider based in Anchorage,
Alaska, offering local and long-distance voice, wireless, video,
and data services to consumer and commercial customers throughout
the state. GCI also holds material equity interests, including
Charter stock and Liberty Broadband, whose principal asset is its
interest in Charter. GCI's other businesses and assets consist of
its subsidiary Evite and its equity interest in Lending Tree. The
company generated $914 million in revenue for the last 12 months
ended March 31, 2020.
The principal methodology used in these ratings was
Telecommunications Service Providers published in January 2017.
GIGA-TRONICS INC: Posts $2 Million Net Loss in FY 2019
------------------------------------------------------
Giga-Tronics Incorporated reported a net loss attributable to
common shareholders of $2.03 million on total revenue of $11.77
million for the year ended March 28, 2020, compared to a net loss
attributable to common shareholders of $1.04 million on total
revenue of $11.15 million for the year ended March 30, 2019.
Net loss in fiscal 2020 includes a one-time, non-cash expense of
$1.2 million or ($1.01) per fully diluted share related to the
issuance of common shares in exchange for the majority of the
Company's Series E preferred shares on Nov. 8, 2019. EBITDA was
$183,000 in fiscal 2020 compared to $362,000 for fiscal 2019. Both
the fiscal 2020 net loss attributable to common shareholders and
EBITDA were adversely impacted by the temporary fourth quarter
closure.
As of March 28, 2020, the Company had $8.93 million in total
assets, $3.37 million in total current liabilities, $1.25 million
in total long term liabilities, and $4.30 million in total
shareholders' equity.
Revenue for the fourth fiscal quarter ended March 28, 2020 was $2.6
million, as compared to $3.5 million for the same period of fiscal
2019. Fourth quarter revenue was adversely impacted by the
Company's compliance with California's Shelter-in-Place order
during the month of March, which resulted in the temporary closure
of its California facilities and a loss of production. Net loss
attributable to common shareholders for the fourth quarter was
$664,000, or ($0.54) per share, compared to net income of $43,000
or $0.03 per fully diluted share, for the same period last year.
The Company recorded an EBITDA loss of ($446,000) for the fourth
quarter compared to EBITDA of $392,000 for the same quarter in
fiscal 2019. Both the fourth quarter net loss attributable to
common shareholders and the EBITDA loss were caused primarily by
the sudden shelter-in-place order in March 2020, resulting in a
loss of production and associated revenue as well as lower gross
profits related the RADAR filter business.
John Regazzi, CEO of the Company said, "Giga-tronics, like many
other companies in the U.S., was impacted by the mandated shutdowns
in March associated with the COVID-19 pandemic, and as a result of
the temporary closure of our California facilities, our fourth
quarter revenue, cash flow and profitability were lower than we
anticipated. Our shutdown in March was relatively short and we
were subsequently designated an essential business. That said, we
had also temporarily halted production earlier in the quarter to
execute a carefully planned cybersecurity upgrade required by a
customer and had expected to shift and complete this production
volume during March when the California shutdown unexpectedly
occurred. The Company resumed full production levels in April
while implementing social distancing measures via two production
shifts, remote work-at-home arrangements for most other employees
and other appropriate employee safety measures."
Lutz Henckels, executive vice president and chief financial
officer, stated, "We continue to manage through the dynamic and
uncertain COVID-19 situation, focusing first and foremost on the
safety of our employees, while also addressing supply disruptions,
and any delays in orders. With our Microsource filter business
back in production and the strong interest we are seeing in our
higher margin RADAR/EW testing solutions, we are cautiously
optimistic about our prospects moving forward."
Lutz Henckels continued "The RADAR/EW testing solutions business
revenues grew 66% in fiscal 2020 and we believe we can drive robust
growth in this part of our business in fiscal 2021. We believe
national defense RADAR/EW testing represents an addressable market
of up to $440 million per year and we are focused on continuing to
leverage our proven technology to expand existing and to develop
new customer relationships and increase our market share."
A full-text copy of the Annual Report is available for free at the
Securities and Exchange Commission's website at:
https://is.gd/pnZbPP
About Giga-Tronics
Headquartered in Dublin, California, Giga-Tronics Incorporated
produces RADAR filters and Microwave Integrated Components for use
in military defense applications as well as sophisticated RADAR and
Electronic Warfare (RADAR/EW) test products primarily used in
electronic warfare test & emulation applications.
GORDON JENSEN: Hires Marcus & Millichap as Real Estate Agent
------------------------------------------------------------
Gordon Jensen Health Care Association, Inc., filed an amended
application seeking authority from the U.S. Bankruptcy Court for
the Northern District of Georgia to employ Marcus & Millichap Real
Estate Investment Brokerage Company, as seller's agent for the
estate.
The Debtor scheduled the value of its nursing care facility
commonly known as "Knollwood Nursing Home", located at 3151
Knollwood Drive, Mobile, AL at $8,700,000 and disclosed mortgages
on the Facility held by BOKF, N.A., d/b/a Bank of Oklahoma, as
successor indenture trustee, with an aggregate approximate balance
of $8,610,000.
Marcus & Millichap will market the facility and procure a buyer.
Marcus & Millichap will receive a commission equal to 3 percent of
the gross purchase price of the gross sales price.
Marcus & Millichap does not represent any interest adverse to the
Estate and is a disinterested person as that term is defined 11
U.S.C. Sec. 101 (14), according to court filings.
The agent can be reached through:
Mike Pardoll
Marcus & Millichap Real Estate
Investment Brokerage Company
405 Eagle Bend Drive
Waxhaw, NC 28173
About Gordon Jensen Health
Care Association Inc.
Gordon Jensen Health Care Association, Inc. is a tax-exempt,
nonprofit corporation whose mission is to provide elderly nursing
care and housing.
Gordon Jensen Health Care Association, Inc., based in Atlanta, GA,
filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 20-61915) on
Feb. 1, 2020. In the petition signed by Scott Hardin, president,
the Debtor was estimated to have $1 million to $10 million in
assets and $10 million to $50 million in liabilities. Theodore N.
Stapleton, Esq., at Theodore N. Stapleton P.C., serves as
bankruptcy counsel.
GUITAR CENTER: S&P Upgrades ICR to 'CCC-' on Distressed Exchange
----------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Westlake
Village, Calif.-based Guitar Center Inc. to 'CCC-' from 'SD', which
reflects its view that approaching maturities may lead the company
to further restructure its capital structure over the next six
months.
At the same time, S&P is lowering the rating on the senior secured
notes to 'CCC-'. The rating on the existing senior unsecured notes
will remain a 'D' until the company completes the post-closing
exchange offer.
S&P continues to view Guitar Center's capital structure as
unsustainable and fast-approaching maturities may be an impetus for
the company to pursue a more holistic debt restructuring.
The transaction support agreement allowed the company to
effectively convert its April 15 cash interest payments to
payment-in-kind interest, which led to a modest increase in overall
debt obligations. This includes an issuance of $35.75 million of
10% senior secured superpriority notes maturing in 2022. S&P
recognizes the company did the transaction to conserve liquidity
given the uncertainty created by the COVID-19 outbreak, however the
maturities of the capital structure are unchanged. The $375 million
asset-based-lending (ABL) facility has a springing maturity of July
17, 2021 (if the senior secured notes are not refinanced), and the
senior secured notes are due Oct. 15, 2021.
S&P believes volatile market and business conditions created by the
pandemic reduce the likelihood of the company addressing these
maturities in a fashion that would provide lenders with the full
promise of the original security, and may lead the company to
address them in the near term. If a restructuring resulted in any
of the lenders receiving less than the original promise of the
security, it would view that as tantamount to a default.
Under the agreement, the company is also required to launch a
post-closing exchange offer of the remaining existing unsecured
notes for the new unsecured notes. Lenders who participate in the
offer would forfeit their April 15 cash interest payment. As a
result, S&P is keeping the 'D' rating on the senior unsecured
notes, and will revise it following the completion of the offer.
S&P expects Guitar Center's performance will continue to be
hampered by the COVID-19 pandemic, leading to a sharp decline in
revenue and EBITDA for fiscal 2020.
Guitar Center closed its retail locations in late March and has
begun the path to reopening. S&P said, "Although we believe the
company's online channels have benefited from the store closures,
we expect revenues generated will not cover the sales that would
have occurred through the stores. It is our view that revenue
generation will improve with stores reopening, however the path and
pace of recovery are uncertain. We believe consumers might continue
to social distance out of an abundance of caution, which combined
with a weakened macroeconomic environment could lead to a slow
recovery of sales once the store base is fully opened. We believe
that Guitar Center should have sufficient liquidity to weather this
period of slowed sales."
Environmental, social, and governance (ESG) factors relevant to
this rating action:
-- Health and safety
S&P said, "The negative outlook reflects our view that Guitar
Center could pursue a distressed exchange or debt restructuring in
the next six months.
"We could lower the rating if Guitar Center announced a debt
exchange or restructuring that results in lenders receiving less
than the original promise of the security.
"We could raise the rating if we believe a restructuring in the
next six months is unlikely, even if the capital structure remains
unsustainable."
HAWAIIAN HOLDINGS: Moody's Cuts CFR to B1, Outlook Negative
-----------------------------------------------------------
Moody's Investors Service downgraded its ratings for Hawaiian
Holdings, Inc.; corporate family rating to B1 from Ba3 and
probability of default rating to B1-PD from Ba3-PD. Moody's also
downgraded subsidiary Hawaiian Airlines, Inc.'s Series 2013-1
Enhanced Equipment Trust Certificate ratings to Ba2 from Ba1 for
the Class A and to B1 from Ba3 for the Class B. The speculative
grade liquidity rating was upgraded to SGL-2 from SGL-3. The
ratings outlook is negative. Its rating actions conclude the review
for downgrade of Hawaiian's ratings that was initiated on March 17,
2020.
The spread of the coronavirus pandemic, the weakened global
economic outlook, low and volatile oil prices, and asset price
declines are sustaining a severe and extensive credit shock across
many sectors, regions and markets. The combined credit effects of
these developments are unprecedented. The passenger airline
industry is one of the sectors most significantly affected by the
shock given its exposure to travel restrictions and sensitivity to
consumer demand and sentiment. Moody's regards the coronavirus
pandemic as a social risk under its ESG framework, given the
substantial implications for public health and safety. Its
downgrade of Hawaiian's ratings balances the company's good
liquidity against the breadth and severity of the coronavirus shock
and the uncertain trends in passenger demand to, from and within
Hawaii for an unknown period. Hawaiian derives its revenue about
one-third each from its US mainland, inter-island and trans-Pacific
-- mainly Japan, Korea, Australia and New Zealand -- networks.
Travel restrictions, including for inter-island service and
required quarantines for arrivals to Hawaii could linger, slowing
the recovery of demand for the airline.
Moody's expects the coronavirus pandemic will significantly curtail
US domestic and global demand for air travel for an extended
period. Moody's assumed that Hawaiian's Q4 2020 capacity would be
down about 40% from Q4 2019 in its faster recovery model and about
70% in its slower recovery model. In all scenarios, the reduction
in passenger demand is greater than the reduction in capacity,
leading to meaningfully lower load factors. These scenarios also
assume that passenger demand and operating margins substantially
increase towards 2019 levels in 2023. Hawaiian has been the second
most profitable US airline between 2013 and 2019, with an average
operating margin of about 16.4%. Allegiant is the leader at about
20%. The risk of more challenging downside scenarios remains high,
and the severity and duration of the pandemic and travel
restrictions remain highly uncertain, particularly given the threat
of an increase in the number of infections as social distancing
practices in the continental US ease in upcoming weeks and beyond.
The future trend of infections in the continental US could lead to
Hawaii extending the required 14-day quarantines and travel
restrictions that are currently in place.
The negative outlook reflects the potential for greater than
already anticipated impacts of the coronavirus, which would consume
more of the company's liquidity and delay the pace and scope of the
recovery in demand, the retirement of debt and the strengthening of
credit metrics relative to Moody's current expectations.
LIQUIDITY
Moody's estimate of cash and short-term investments of about $750
million on April 30 supports the company's good liquidity profile.
The company drew its $235 million revolver due in December 2022 on
March 16th. Hawaiian will receive $146 million under the Payroll
Support Program of the US Coronavirus Aid, Relief, and Economic
Security Act. Of this amount, $58 million will be a 10-year,
unsecured loan. A CARES Act secured loan of $364 million will also
be available to Hawaiian through September 30, 2020, should it
decide to utilize this part of the program. Income tax refunds
under certain provisions in the CARES Act will be an additional
source of liquidity. Unsecured assets with value of about $800
million remain available for additional financing, if needed.
RATINGS RATIONALE
The B1 corporate family rating balances Hawaiian's recent modest
financial leverage against its niche model providing passenger air
service anchored in the State of Hawaii. The company has a record
of solid operating performance and focused debt reduction in recent
years, sustaining debt-to-EBITDA below 2.4x between 2016 and 2019.
Recent financial performance has been pressured by Southwest
Airlines' entry into the US West Coast to Hawaii and inter-island
markets. The competitive intensity will continue when restoration
of normal flight schedules occurs, which will likely pressure
margins and operating cash flows. The order for ten 787-9
wide-bodies, if maintained, will also lead to higher adjusted debt
balances, leading to some re-levering of the capital structure.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The corporate family rating could be downgraded if Moody's believes
the coronavirus will constrain passenger demand for an extended
period and/or credit metrics deteriorate more than expected.
Downward ratings pressure would result if the aggregate of cash and
revolver availability approach $450 million; a longer-running
decline in passenger bookings continues into 2021, or a slower pace
of recovery as a result of the coronavirus pandemic occurs,
particularly if not matched by further additional sources of
liquidity; greater liquidity pressure from an inability to remove
costs and cut capital spending; and/or if there are clear
expectations that Hawaiian will not be able to timely restore its
financial profile once the virus recedes (for example, if
debt-to-EBITDA approaches 5.5x, funds from operations plus
interest-to-interest approaches 2.5x or retained cash flow-to-debt
drops below 12%). There will be no upwards pressure on the ratings
until after passenger demand returns to pre-coronavirus levels,
Hawaiian maintains liquidity above $800 million, and key credit
metrics improve such as EBITDA margins above 20%, debt-to-EBITDA is
sustained below 4.5x and retained cash flow-to-debt approaches 15%
while the company takes delivery of the 787s on order in upcoming
years and while competing with expanding service from Southwest
Airlines.
Changes in the EETC ratings can result from any combination of
changes in the underlying credit quality or ratings of the company,
Moody's opinion of the importance of the aircraft collateral to the
company's operations, and/or its estimates of current and projected
aircraft market values, which will affect estimates of
loan-to-value.
The methodologies used in these ratings were Passenger Airline
Industry published in April 2018.
The following rating actions were taken:
Downgrades:
Issuer: Hawaiian Holdings, Inc.
Corporate Family Rating, Downgraded to B1 from Ba3
Probability of Default Rating, Downgraded to B1-PD from Ba3-PD
Issuer: Hawaiian Airlines, Inc.
Senior Secured Enhanced Equipment Trust Class A, Downgraded to Ba2
from Ba1
Senior Secured Enhanced Equipment Trust Class B, Downgraded to B1
from Ba3
Upgrades:
Issuer: Hawaiian Holdings, Inc.
Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3
Outlook Actions:
Issuer: Hawaiian Airlines, Inc.
Outlook, Changed to Negative from Rating Under Review
Issuer: Hawaiian Holdings, Inc.
Outlook, Changed to Negative from Rating Under Review
Headquartered in Honolulu, Hawaii, Hawaiian Holdings, Inc. is
publicly traded company (NASDAQ: HA) and the holding company parent
of Hawaiian Airlines, Inc., Hawaii's biggest and longest-serving
airline. Hawaiian offers non-stop service to Hawaii from 13 US
gateway cities, along with service from Japan, South Korea,
Australia, New Zealand, American Samoa and Tahiti during normal
times. In 2019, Hawaiian also provided approximately 170 jet
flights daily between the Hawaiian Islands, with a total of almost
260 daily flights systemwide. Revenue was $2.7 billion for the last
twelve months ended March 31, 2020.
HORNBECK OFFSHORE: Davis, Porter Represent Secured Lender Group
---------------------------------------------------------------
In the Chapter 11 cases of Hornbeck Offshore Services, Inc. et al.,
the law firms of Davis Polk & Wardwell LLP and Porter Hedges LLP
submitted a verified statement under Rule 2019 of the Federal Rules
of Bankruptcy Procedure, to disclose that it they are representing
Aristeia Capital, L.L.C., Highbridge Capital Management, LLC, Oak
Hill Advisors, L.P., Phoenix Investment Adviser, LLC, Whitebox
Advisors LLC and Wolverine Asset Management, LLC.
The Secured Lender Group formed by lenders under (i) that certain
senior credit agreement, dated as of June 28, 2019, (ii) that
certain first lien term loan credit agreement, dated as of June 15,
2017 and (iii) that certain second lien term loan credit agreement,
dated as of February 7, 2019.
In or around March 2020, the Secured Lender Group engaged Davis
Polk to represent it in connection with the Members' holdings of
Term Loans and engaged Porter Hedges to act as co-counsel in these
Chapter 11 Cases.
Counsel represents the Secured Lender Group. Counsel does not
represent or purport to represent any other entity or entities in
connection with the Chapter 11 Cases. In addition, the Secured
Lender Group does not claim or purport to represent any other
entity and undertakes no duties or obligations to any entity.
As of May 18, 2020, members of Secured Lender Group and their
disclosable economic interests are:
ARISTEIA CAPITAL, L.L.C.
One Greenwich Plaza
Greenwich, CT 06830
* $11,000,000.00 in aggregate principal amount of Second Lien Term
Loan Claims
HIGHBRIDGE CAPITAL MANAGEMENT, LLC
40 West 57th Street 32nd Floor
New York, NY 10019
* $98,751,658.78 in aggregate principal amount of First Lien Term
Loan Claims
OAK HILL ADVISORS, L.P.
1114 Avenue of the Americas 27th Floor
New York, NY 10036
* $17,439,166.00 in aggregate principal amount of First Lien Term
Loan Claims
PHOENIX INVESTMENT ADVISER, LLC
420 Lexington Ave Suite 2040
New York, NY 10170
* $11,050,000.00 in aggregate principal amount of Second Lien Term
Loan Claims
* $491,000.00 in aggregate principal amount of 2020 Notes Claims
WHITEBOX ADVISORS LLC
3033 Excelsior Boulevard Suite 300
Minneapolis, MN 55416
* $50,000,000.00 in aggregate principal amount of ABL Claims
* $179,204,148.51 in aggregate principal amount of First Lien Term
Loan Claims
* $53,431,000.00 in aggregate principal amount of Second Lien Term
Loan Claims
WOLVERINE ASSET MANAGEMENT
175 W. Jackson Blvd. Suite 340
Chicago, IL 60604
* $5,304,000.00 in aggregate principal amount of Second Lien Term
Loan Claims
Counsel to the Secured Lender Group can be reached at:
PORTER HEDGES LLP
John F. Higgins, Esq.
Eric M. English, Esq.
Shane Johnson, Esq.
1000 Main Street, 36th Floor
Houston, TX 77002
Telephone: (713) 226-6000
Facsimile: (713) 226-6248
Email: jhiggins@porterhedges.com
eenglish@porterhedges.com
sjohnson@porterhedges.com
- and -
DAVIS POLK & WARDWELL LLP
Damian S. Schaible, Esq.
Darren S. Klein, Esq.
Stephanie Massman, Esq.
450 Lexington Avenue
New York, NY 10017
Telephone: (212) 450-4000
Facsimile: (212) 701-5800
Email: damian.schaible@davispolk.com
darren.klein@davispolk.com
stephanie.massman@davispolk.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://is.gd/UjLhGo
About Hornbeck Offshore Services
Hornbeck Offshore Services, Inc., provides marine transportation
services to exploration and production, oilfield service, offshore
construction, and U.S. military customers. Hornbeck and its
affiliates were incorporated in 1997 and are headquartered in
Covington, Louisiana.
On May 19, 2020, Hornbeck Offshore Services and its affiliates
sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No.
20-32679).
The Hon. David R. Jones is the case judge.
Hornbeck Offshore disclosed total assets of $2,691,806,000 and
total liabilities of $1,493,912,000 as of Sept. 30, 2019.
The Debtors tapped KIRKLAND & ELLIS LLP as general bankruptcy
counsel; WINSTEAD PC as co-counsel; GUGGENHEIM SECURITIES, LLC as
financial advisor; and PORTAGE POINT PARTNERS, LLC as restructuring
advisor. STRETTO is the claims agent.
HORNBECK OFFSHORE: In Chapter 11 to Seek OK of Prepackaged Plan
---------------------------------------------------------------
Effective April 13, 2020, Hornbeck Offshore Services, Inc., and
certain of its subsidiaries entered into a Restructuring Support
Agreement with secured lenders holding approximately 83% of the
Company's aggregate secured indebtedness and unsecured noteholders
holding approximately 79% of the Company's aggregate unsecured
notes outstanding.
On May 19, 2020, the Debtors sought voluntary relief under chapter
11 of the United States Bankruptcy Code in the U.S. Bankruptcy
Court for the Southern District of Texas, Houston Division and
filed a proposed joint prepackaged plan of reorganization.
Grant Rowles, writing for Splash247.com, reports that oil and gas
exploration company Hornbeck Offshore Services Inc. in mid-May 2020
launched the solicitation of votes from lenders and unsecured
noteholders to support its prepackaged Chapter 11 reorganization
plan.
In connection with the filing of the Plan, on May 22, 2020, the
Debtors entered into a debtor-in-possession credit agreement on the
terms set forth in a Superpriority Debtor-in-Possession Term Loan
Agreement, by and among Hornbeck, as Parent Borrower, Hornbeck
Offshore Services, LLC, as Co-Borrower, the lenders party thereto,
and Wilmington Trust, National Association, as Administrative Agent
and Collateral Agent, pursuant to which, the DIP Lenders agreed to
provide the Company with loans in an aggregate principal amount not
to exceed $75 million that, among other things, will be used to
repay in full $50 million in loans outstanding under that certain
Senior Credit Agreement, and to finance the ongoing general
corporate needs of the Debtors during the course of the Chapter 11
Cases.
OTC Pink Open Market
On May 19, 2020, the OTCQB U.S. Market was notified that Hornbeck
had filed the Plan and commenced the Chapter 11 cases. As an
issuer may not be listed on the OTCQB if it is subject to
bankruptcy or reorganization proceedings, the OTCQB removed
Hornbeck from listing on the OTCQB and Hornbeck moved to and will
continue trading on the OTC Pink Open Market. The Company's common
stock began trading on the OTC Pink on May 20, 2020 under the
Symbol "HOSSQ."
NOL Order
On May 20, 2020, the Bankruptcy Court entered the Order (A)
Approving Notification and Hearing Procedures for Certain Transfers
of Common Stock and (B) Granting Related Relief Docket No. 84 (the
"NOL Order"). The NOL Order establishes certain notification and
hearing procedures related to certain purchases, sales, and other
transfers of the Debtors' existing common stock in order to
preserve and protect the potential value of the Debtors' existing
and future net operating losses and certain other of the Debtors'
tax attributes.
The Procedures, among other things, restrict certain transactions
involving, and require notices of the holdings of and proposed
transactions by, any person or entity that is or, as a result of
such a transaction, would become a Substantial Shareholder of
common stock. For purposes of the Procedures, a "Substantial
Shareholder" is any entity or individual person that has beneficial
ownership (as determined in accordance with applicable rules under
the Internal Revenue Code of 1986, as amended) of, after taking
into account certain options or other similar rights to acquire
beneficial ownership of common stock, at least 1,782,072 shares of
common stock (representing approximately 4.5% of all issued and
outstanding shares of common stock as of the Petition Date). Any
prohibited transfer of stock would be null and void ab initio and
will result in remedial actions and such other (or additional)
measures as the Bankruptcy Court may deem appropriate.
About Hornbeck Offshore Services
Hornbeck Offshore Services, Inc., provides marine transportation
services to exploration and production, oilfield service, offshore
construction, and U.S. military customers. Hornbeck and its
affiliates were incorporated in 1997 and are headquartered in
Covington, Louisiana.
On May 19, 2020, Hornbeck Offshore Services and its affiliates
sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No.
20-32679).
The Hon. David R. Jones is the case judge.
Hornbeck Offshore disclosed total assets of $2,691,806,000 and
total liabilities of $1,493,912,000 as of Sept. 30, 2019.
The Debtors tapped KIRKLAND & ELLIS LLP as general bankruptcy
counsel; WINSTEAD PC as co-counsel; GUGGENHEIM SECURITIES, LLC as
financial advisor; and PORTAGE POINT PARTNERS, LLC as restructuring
advisor. STRETTO is the claims agent.
IGLESIA TABERNACULO: Seeks to Hire Landrau Rivera as Legal Counsel
------------------------------------------------------------------
Iglesia Tabernaculo De Adoracion Y Alabanza, Inc. seeks authority
from the United States Bankruptcy Court for the District of Puerto
Rico to hire the law offices of Landrau Rivera & Associates, and
its attorney Noemí Landrau Rivera, Esq., as its legal counsel.
The Debtor requires the counsel to:
a) advise DIP with respect to its duties, powers and
responsibilities in this case under the laws of the United States
and Puerto Rico in which the debtor in possession conducts its
business, or is involved in litigation;
b) advise DIP in connection with a determination whether a
reorganization is feasible and, if not, aiding debtor in the
orderly liquidation of its assets;
c) assist DIP with respect to negotiations with creditors for
the purpose of proposing a viable plan of reorganization;
d) prepare on behalf of the DIP the necessary complaints,
answers, orders, reports, memoranda of law and/or any other legal
papers or documents;
e) appear before the Bankruptcy Court, or any court in which
DIP asserts a claim interest or defense directly or indirectly
related to this bankruptcy case;
f) perform such other legal services for DIP as may be
required in these proceedings or in connection with the operation
of/and involvement with debtor’s business, including but not
limited to notarial services;
g) employ other professional services as necessary to complete
debtor's financial reorganization with Chapter 11 of the Bankruptcy
Code.
The firm's hourly rates are:
Noemi Landrau Rivera, Esq. $200
Josue A. Landrau Rivera, Esq. $175
Legal and Financial Assistants $75
The firm received a retainer in the amount of $10,000.
Landrau Rivera & Associates is disinterested person within the
definition provided by 11 USC Sec. 101(14), according to court
filings.
The firm can be reached through:
Noemi Landrau Rivera, Esq.
Landrau Rivera & Associates
Calle Fraser #1423 Urb. Reparto Landraw
00927 San Juan, PR
Phone: +1 787-774-0224
About Iglesia Tabernaculo
De Adoracion Y Alabanza, Inc.
Iglesia Tabernaculo De Adoracion Y Alabanza, Inc. is a nonprofit
religious organization that operates an evangilical church. The
Company owns in fee simple a real property, where the church is
located, at PR Road 132, Km. 22.6, Canas Ward, Ponce, PR, having an
appraised value of $915,000.
Iglesia Tabernaculo De Adoracion Y Alabanza, Inc., filed its
voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr.
D. P.R. Case No. 20-01752) on May 5, 2020. In the petition signed
by Jesus F. Perez Gutierrez, president, the Debtor estimated
$938,025 in assets and $1,274,467 in liabilities. Noemi Landrau
Rivera, Esq. at LANDRAU RIVERA & ASSOCIATES, represents the Debtor
as counsel.
IMAGEWARE SYSTEMS: Kristin Taylor Named to Board of Directors
-------------------------------------------------------------
Kristin A. Taylor has been elected to the board of directors of
ImageWare Systems, Inc., effective May 26, 2020.
Ms. Taylor was appointed as the new President and CEO of ImageWare
as of March 2, 2020 and has already infused the company with new
energy, a stronger vision for the business and an execution plan
that incorporates agility for faster execution. The ongoing
strategic restructuring of the Company will drive results and open
new opportunities for the products and technology.
In connection with her service on the Board and as an employee
director, Ms. Taylor is not entitled to receive any additional
compensation.
About ImageWare Systems
Headquartered in San Diego, CA, ImageWare Systems, Inc. --
http://www.iwsinc.com-- is a developer of mobile and cloud-based
identity management solutions, providing two-factor, biometric and
multi-factor cloud-based authentication solutions for the
enterprise. The company delivers next-generation biometrics as an
interactive and scalable cloud-based solution. ImageWare brings
together cloud and mobile technology to offer two-factor,
biometric, and multi-factor authentication for smartphone users,
for the enterprise, and across industries.
ImageWare recorded a net loss available to common shareholders of
$17.25 million for the year ended Dec. 31, 2019, compared to a net
loss available to common shareholders of $16.46 million for the
year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had
$8.41 million in total assets, $8.29 million in total liabilities,
$8.88 million in series C convertible redeemable preferred stock,
and a total shareholders' deficit of $8.76 million.
Mayer Hoffman McCann P.C., in San Diego, California, the Company's
auditor since 2011, issued a "going concern" qualification in its
report dated May 15, 2020 citing that the Company does not generate
sufficient cash flows from operations to maintain operations and,
therefore, is dependent on additional financing to fund operations.
These conditions raise substantial doubt about the Company's
ability to continue as a going concern.
IMPACT GLASS: Unsecured Creditors to Receive $235K Over 5 Years
---------------------------------------------------------------
Impact Glass Services, LLC, filed with the U.S. Bankruptcy Court
for the Southern District of Florida, Fort Lauderdale Division, a
Disclosure Statement describing its Plan of Reorganization dated
May 8, 2020.
The Debtor filed bankruptcy because the Debtor had an overwhelming
amount of debt and liability that was effecting its operations.
Debtor was forced to file this bankruptcy to reorganize its debts
and restructure itself.
After the effective date of the order confirming the Plan, the
directors, officers, and voting trustees of the Debtor, any
affiliate of the Debtor participating in a joint Plan with the
Debtor, or successor of the Debtor under the Plan will be Yussef
Saieh Velez and Juan C. Llinas.
Class 8 General Unsecured Class will receive payment in the total
amount of $234,635. This amount shall be paid with equal monthly
payments for 60 months of $3,911 following entry of a confirmation
Order, on a pro rata basis. General unsecured creditors who file a
valid proof of claim will receive payment on a pro-rata basis.
Class 9 Equity Interest Holders will retain their equity in the
Debtor based on the payment of new value by funding this plan,
relinquishment of their unsecured claims and their further
operation of the Debtor.
Payments and distributions under the Plan will be funded by the
Value paid in by the shareholder and director of the Debtor.
The Plan Proponent’s financial projections show that the Debtor
will have an aggregate annual average cash flow, after paying
operating expenses, post-confirmation taxes and other expenses, of
$72,000.00. The final Plan payment is expected to be paid upon
completion of the 60 month term of the plan.
A full-text copy of the disclosure statement dated May 8, 2020, is
available at https://tinyurl.com/y97xardu from PacerMonitor at no
charge.
Attorney for Plan Proponent:
Richard R. Robles, Esquire
About Impact Glass Services
Impact Glass Services, LLC -- https://www.impactglassmiami.com/ --
specializes in commercial and residential glass services. It has
been serving the glass needs for homeowners, condo associations,
property managers, business owners and high-end construction
companies of South Florida since 2009.
Impact Glass Services sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-22046) on Sept. 9,
2019. At the time of the filing, the Debtor was estimated to have
assets of between $500,000 and $1 million and liabilities of
between $1 million and $10 million. Judge John K. Olson oversees
the case. The Debtor is represented by the Law Offices of Richard
R. Robles, P.A.
IN MARKETING GROUP: Unsecureds to Get Up to 34% Founder's Deal
--------------------------------------------------------------
In Marketing Group, Inc., submitted an Amended Plan of
Reorganization that will provide a 27% to 34% recovery to holders
of Class 4 general unsecured claims as a result of a settlement
with its co-founder.
Andrew Perlmutter is the co-founder of the Debtor. In 2012, the
Debtor and Perlmutter contemporaneously executed two integrated
agreements in connection with the Debtor's buy-out of Perlmutter's
50 percent stake in the Debtor. The Debtor and Perlmutter also
executed a consulting agreement, which required the Debtor to remit
10 percent of gross profits to Perlmutter.
The Debtor's Schedule F lists Perlmutter as holding a general,
unsecured claim in the amount of $1,004,233 that is undisputed,
non-contingent, and liquidated. On Nov. 12, 2019, the Debtor
commenced an adversary proceeding against Perlmutter (Adv. Pro.
No.19-02264(SLM)). The Debtor's complaint against Perlmutter seeks
the subordination ofthe Perlmutter Claim arising from the Debtor's
inability to complete payments required under the Buy-Out and to
recover payments made to Perlmutter as fraudulent transfers.
Following mediation, the parties reached a settlement of the
Perlmutter Adversary Proceeding. The settlement is backed by the
Creditors' Committee. The parties have signed a binding term
sheet, which provides these terms:
* Perlmutter will pay the Debtor's estate the sum of $105,000.
Payment will be made by Perlmutter to his counsel's (Price Meese
Shulman & D'Arminio, P.C.) trust account within seven days of the
parties' execution of the Term Sheet, with the settlement proceeds
to thereafter be held by Perlmutter’s counsel in trust pending
approval of the within settlement by the Bankruptcy Court;
* The Debtor will prepare and file the necessary motion with the
Bankruptcy Court to approve the within settlement pursuant to Fed.
R. Bankr. P. 9019;
* Perlmutter agrees to and shall waive any and all claims
against the Debtor's estate;
* The Debtor and its estate agrees to and shall waive any and
all claims against Perlmutter;
* The Debtor, on behalf of its estate, and Perlmutter shall each
execute mutual general releases in favor
of the other;
* David Weiss and Alan Traiger, on one hand, and Perlmutter, on
the other hand, shall each execute mutual general releases in favor
of each other;
* The pending adversary proceeding will be dismissed with
prejudice, without costs to either party;
On April 20, 2020, the Debtor filed a motion to approve the
Perlmutter Settlement Agreement. The Debtor expects that the
Bankruptcy Court will approve the Perlmutter Settlement Agreement
without opposition from any Creditor or party-in-interest.
As the Perlmutter Claim is waived in its entirety under the
Perlmutter Settlement Agreement, the Plan does not provide for or
otherwise address the Perlmutter Claim. The expected recovery by
Holders of General Unsecured Claims has increased by about 10
percent due to the elimination of the Perlmutter Claim.
In 2016, the Debtor and Las Vegas Sands Corp. entered into a
Professional Services Agreement, as amended. Under the PSA the
Debtor developed content for events related to the patron loyalty
rewards program, named the Grazie Loyalty Program, for The Venetian
Las Vegas and The Palazzo Las Vegas (the "Venetian"). The Venetian
is the destination resort, hotel, and casinos on the Las Vegas
Strip owned and operated by the Sands. The Sands is the owner of
United States Trademark Registration No. 3,969,084 for its GRAZIE
trademark. With the Sands' knowledge and approval, the Debtor
registered certain domain names (the "Grazie Domain Names") in
connection with the services to be provided under the PSA. The
Grazie Domain Names are owned by the Debtor. At no time while the
Debtor was providing the services under the PSA did the Sands
express any objections or reservations about the Debtor's
registration of the Grazie Domain Names. Prior to the Petition
Date, the Debtor ceased performing services pursuant to the PSA.
The Sands filed Claim No. 47 (the "Sands Claim") against the Debtor
asserting an unliquidated general, unsecured claim in an "unknown"
amount. The Sands asserts that the Debtor unlawfully registered and
is unlawfully using the Grazie Domain Names without the Sands'
authorization which it claims constitutes cybersquatting in
violation of the Lanham Act,15 U.S.C Sec. 1125(c). The Debtor
denies this contention and disputes the Sands Claim.
The global spread of the Covid-19 virus, declared a pandemic by the
World Health Organization on March 11, 2020, has negatively
impacted the Debtor's projected future revenues. The Debtor's
reduced anticipated future profits has forced it to decrease the
amount of payments to be made by the Reorganized Debtor to the
Litigation Trust for the benefit of Holders of Class 4 Claims
(General Unsecured Claims) pursuant to the Plan. The amount of the
GUC Distribution Fund under the Debtor's originally filed Plan (the
"Original Plan") was $1.5 million, while under the current Plan
such amount is $1.2 million. The amount of the GUC Buyout Amount
under the Original Plan was $1,325,000, while under the current
Plan such amount is $1million.Under the Original Plan the first
semi-annual payment due during the Trust Funding Period was due
within 30 days from the Effective Date, while under the current
Plan such payment is due by January 15, 2021.
During the Trust Funding Period, the Debtor shall make semi-annual
payments in Cash to the Litigation Trust on or before: (A)February
1 of each year during the Trust Funding Period in the aggregate
amount of no less than $200,000; and (B) August 1 of each year
during the Trust Funding Period in the aggregate amount of no less
than one-hundred thousand dollars ($100,000), which payments shall
be made from the GUC Distribution Fund, unless the Reorganized
Debtor exercises the GUC Buyout Option by the GUC Buyout Date;
provided however that the payment due on or before August 1, 2020
shall instead be due by January 15, 2021.
A full-text copy of the Disclosure Statement dated May 6, 2020, is
available at https://tinyurl.com/ybwdm8hp from PacerMonitor.com at
no charge.
Counsel for the Debtor:
Eric J. Snyder, Esq.
Eloy A. Peral, Esq.
WILK AUSLANDER LLP
1515 Broadway, 43rd Floor
New York, New York 10036
Telephone: (212) 981-2300
E-mail: esnyder@wilkauslander.com
eperal@wilkauslander.com
- and -
John P. Di Iorio, Esq.
SHAPIRO, CROLAND, REISER,
APFEL & DI IORIO LLP
411 Hackensack Avenue
Hackensack, New Jersey 07601
Telephone: (201) 897-2411
E-mail: jdiiorio@shapiro-croland.com
About IN Marketing Group
IN Marketing Group -- http://www.inmarketinggroup.com/-- is an
advertising agency that helps companies grow by providing corporate
gifts and customized incentive programs to their clients. It helps
businesses penetrate new markets, reward their loyal customers and
upsell to existing clients while retaining their top sales
performers.
IN Marketing Group sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.N.J. Case No. 19-25754) on Aug. 14, 2019.
In the petition signed by Alan Traiger, president, the Debtor
disclosed $2,206,521 in assets and $4,513,541 in liabilities. The
case is assigned to Judge Stacey L. Meisel. The Debtor is
represented by Shapiro Croland Reiser Apfel & Di Iorio, LLP and
Wilk Auslander LLP.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors in the Debtor's bankruptcy case.
INTELSAT SA: Gets Approval to Hire Stretto as Claims Agent
----------------------------------------------------------
Intelsat S.A. and its affiliates received approval from the U.S.
Bankruptcy Court for the Eastern District of Virginia to employ
Stretto as claims and noticing agent.
The firm will oversee the distribution of notices and will assist
in the maintenance, processing and docketing of proofs of claim
filed in Debtors' Chapter 11 cases.
Prior to their bankruptcy filing, Debtors provided the firm a
retainer in the amount of $100,000.
Sheryl Betance, managing director of Stretto, 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:
Sheryl Betance
Bankruptcy Management Solutions, Inc. d/b/a Stretto
410 Exchange, Ste. 100
Irvine, CA 92602
Telephone: (714) 716-1872
Email: sheryl.betance@stretto.com
About Intelsat S.A.
Intelsat S.A. -- www.intelsat.com -- is a publicly held operator of
satellite services businesses, which provides a diverse array of
communications services to a wide variety of clients, including
media companies, telecommunication operators, internet service
providers, and data networking service providers. The Company is
also a provider of commercial satellite communication services to
the U.S. government and other select military organizations and
their contractors. The Company's administrative headquarters are in
McLean, Virginia, and the Company has extensive operations spanning
across the United States, Europe, South America, Africa, the Middle
East, and Asia.
Intelsat S.A. and its debtor affiliates concurrently filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Va. Lead Case No. 20-32299) on May 13, 2020. The
petitions were signed by David Tolley, executive vice president,
chief financial officer, and co-chief restructuring officer. At the
time of the filing, the Debtors disclosed total assets of
$11,651,558,000 and total liabilities of $16,805,844,000 as of
April 1, 2020.
Judge Keith L. Phillips oversees the cases. The Debtors tapped
Kirkland & Ellis LLP and Kutak Rock LLP as legal counsel; Alvarez &
Marsal North America, LLC as restructuring advisor; PJT Partners LP
as financial advisor & investment banker; Deloitte LLP as tax
advisor; and Stretto as claims and noticing agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on May 27,
2020.
INVERNESS TWO: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Inverness Two Inc.
f/d/b/a Inverness II Condominium Association, Inc.
13151 Walden Road
Montgomery, TX 77356
Business Description: Inverness Two Inc., a Texas nonprofit
corporation, is a Single Asset Real
Estate (as defined in 11 U.S.C. Section
101(51B)).
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 20-32836
Judge: Hon. Jeffrey P. Norman
Debtor's Counsel: Aaron J. Power, Esq.
PORTER HEDGES LLP
1000 Main Street, 36th Floor
Houston, TX 77002
Tel: (713) 226-6000
E-mail: apower@porterhedges.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $500,000 to $1 million
The petition was signed by Alexander Krakovsky, president.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors at the time of the filing.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/gWDel1
J. HILBURN INC: Seeks to Hire MMG Advisors as Investment Banker
---------------------------------------------------------------
J. Hilburn, Inc. seeks authority from the United States Bankruptcy
Court for the Northern District of Texas to hire employ MMG
Advisors, Inc. to provide advisory services.
MMG will evaluate the Debtor's strategic alternatives and provide
investment banking and advisory services in connection with a
potential sale of the Debtor's assets.
The Debtor shall pay MMG an initial monthly retainer fee of $25,000
on the first business day after the order approving MMG Advisor's
employment becomes a final order. Thereafter, the Debtor shall pay
MMG Advisors a monthly fee of $25,000 up to a maximum amount of
$100,000.
Mary Ann Domuracki, Managing Director of MMG, assures the court
that the firm does not hold or represent any interest adverse to
the Debtor or its estate and is a "disinterested person" as defined
in section 101(14) of the Bankruptcy Code.
The advisor can be reached through:
Mary Ann Domuracki
MMG Advisors, Inc.
561 Seventh Avenue, 17th Floor
New York, NY 10018
Phone: (212) 768-9660
Email: info@mmgus.com
About J. Hilburn
J. Hilburn, Inc. -- https://www.jhilburn.com -- sells custom-made
men's clothing. The Company offers shirts, suits, trousers, pants,
sweaters, outerwears, and accessories.
On April 30, 2020, J. Hilburn, Inc., and its affiliates sought
Chapter 11 protection (Bankr. N.D. Tex. Case No. 20-31308). The
petition was signed by David DeFeo, chief executive officer.
Diamondback was estimated to have $1 million to $10 million in
assets and $10 million to $50 million liabilities.
The Debtors tapped Patrick J. Neligan, Jr., Esq. of Neligan LLP as
counsel.
JAGGED PEAK: Case Summary & 8 Unsecured Creditors
-------------------------------------------------
Debtor: Jagged Peak Canada, Inc.
20341 SW Birch St., Suite 220
Newport Beach, CA 92660
Chapter 11 Petition Date: May 28, 2020
Court: United States Bankruptcy Court
District of Nevada
Case No.: 20-12599
Judge: Hon. Mike K. Nakagawa
Debtor's Counsel: Gregory E. Garman, Esq.
GARMAN TURNER GORDON LLP
7251 Amigo Street, Suite 210
Las Vegas, NV 89119
Tel: 725-777-3000
E-mail: ggarman@gtg.legal
Total Assets: $17,752
Total Liabilities: $1,738,372
The petition was signed by Jeremy Rosenthal, CRO.
A copy of the petition containing, among other items, a list of the
Debtor's eight unsecured creditors is available for free at
PacerMonitor.com at:
https://is.gd/qGj4jZ
JC PENNEY: Closing 242 of 846 Store Locations
---------------------------------------------
Dustin Hockensmith, writing for pennlive.com, reports that
Texas-based retailer JC Penney closed 242 locations as part of its
Chapter 11 bankruptcy protection filing.
JC Penney is closing permanently 242 of the 846 stores to decrease
costs. According to JC Penney, its 192 locations are expected to
close by February 2021 and 50 more stores will close in the fiscal
year 2022. However, it didn't disclosed which stores will close.
JC Penney ais to transform its brand by focusing on meaner and
leaner operations, reduced inventory as well as more inspiring and
engaging shopping experience. It also started making progress in
transforming its operations prior to the pandemic.
"The Coronavirus (COVID-19) pandemic has created unprecedented
challenges for our families, our loved ones, our communities, and
our country. As a result, the American retail industry has
experienced a profoundly different new reality, requiring JC Penney
to make difficult decisions in running our business to protect the
safety of our associates and customers and the future of our
company," company CEO Jill Soltau said in the release.
"Until this pandemic struck, we had made significant progress
rebuilding our company under our Plan for Renewal strategy – and
our efforts had already begun to pay off. While we had been
working in parallel on options to strengthen our balance sheet and
extend our financial runway, the closure of our stores due to the
pandemic necessitated a more fulsome review to include the
elimination of outstanding debt."
According to CBS News report, the pandemic has impacted struggling
retailers and many of them were burned by debt. They experienced
and seen their revenues plummet before the pandemic. In the recent
quarter, JC Penney experienced 8% decline of sales.
CBS News also reported that JC Penney gave its top corporate
executives millions of dollars worth of bonuses before it announced
bankruptcy.
About J.C. Penney
J.C. Penney Corporation, Inc., is an American retail company,
founded in 1902 by James Cash Penney and today engaged in marketing
apparel, home furnishings, jewelry, cosmetics, and cookware. The
company was called J.C. Penney Stores Company from 1913 to 1924,
when it was reincorporated as J.C. Penney Co.
On May 15, 2020, JCPenney announced that it has entered into a
restructuring support agreement with lenders holding 70% of
JCPenney's first lien debt. The RSA contemplates agreed-upon terms
for a pre-arranged financial restructuring plan that is expected to
reduce several billion dollars of indebtedness. To implement the
Plan, the Company and its affiliates on May 15, 2020, filed
voluntary petitions for reorganization under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 20-20182).
Kirkland & Ellis LLP is serving as legal advisor, Lazard is serving
as financial advisor, and AlixPartners LLP is serving as
restructuring advisor to the Company. Prime Clerk is the claims
agent, maintaining the page http://cases.primeclerk.com/JCPenney
JDUB'S BREWING: Has Until July 6, 2020 to File Plan
---------------------------------------------------
Judge Michael Williamson of the U.S. Bankruptcy Court for the
Middle District of Florida, Tampa Division, has ordered that debtor
JDub's Brewing Company, LLC, will file a plan on or before July 6,
2020.
A copy of the order dated May 8, 2020, is available at
https://tinyurl.com/yaygjjq5 from PacerMonitor.com at no charge.
About JDub's Brewing Company
JDub's Brewing Company, LLC, is a privately held company in the
beverage manufacturing industry.
The company sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. Fla. Case No.20-02926) on April 6, 2020. In the
petition signed by CEO Jeremy Joerger, the company disclosed
$697,542 in assets and $1,687,781 in debt. Judge Michael G.
Williamson is assigned to the case. Daniel Etlinger, Esq., at
David Jennis, PA, d/b/a Jennis Law Firm, is serving as teh Debtor's
counsel.
JETBLUE AIRWAYS: Moody's Cuts CFR to Ba2 & Sr. Sec. Rating to Ba1
-----------------------------------------------------------------
Moody's Investors Service downgraded its corporate ratings assigned
to JetBlue Airways Corp.; corporate family to Ba2 from Ba1,
probability of default to Ba2-PD from Ba1-PD and senior secured to
Ba1 from Baa3. Moody's confirmed its ratings on the company's
Enhanced Equipment Trust Certificates at A1 and A3, respectively,
for the Class AA and A tranches of its Series 2019-1 EETC. The
speculative grade liquidity rating was downgraded to SGL-3 from
SGL-2. The ratings outlook is negative. Its actions conclude the
review for downgrade of JetBlue's ratings that was initiated on
March 17, 2020.
The spread of the coronavirus pandemic, the weakened global
economic outlook, low oil prices, and asset price declines are
sustaining a severe and extensive credit shock across many sectors,
regions and markets. The combined credit effects of these
developments are unprecedented. The passenger airline industry is
one of the sectors most significantly affected by the shock given
its exposure to travel restrictions and sensitivity to consumer
demand and sentiment. Moody's regards the coronavirus pandemic as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Its downgrade of
JetBlue's ratings considers the potential for JetBlue's recovery
from the coronavirus to move at a slower pace than its US peers
given the geographic concentration of its route network and its
more modest liquidity.
Moody's expects the coronavirus pandemic to significantly curtail
US domestic and global demand for air travel for an extended
period. Moody's assumed that JetBlue's Q4 2020 capacity would be
down about 60% compared to Q4 2019 in its faster recovery model and
that JetBlue's capacity would be down about 70% versus Q4 2020 in
its slower recovery model. These scenarios also project that demand
and revenues will approach 2019 levels in 2023, and that sharper
cost management and efficiencies gained while managing the
operations through the pandemic will support a meaningful recovery
in profit margins by 2023. In all scenarios, the reduction in
passenger demand is greater than the reduction in capacity, leading
to meaningfully lower load factors. The risk of more challenging
downside scenarios remains high and the severity and duration of
the pandemic and travel restrictions also remain highly uncertain,
particularly given the threat of an increase in the number of
infections as social distancing practices ease in upcoming weeks.
The negative outlook reflects the potential for greater than
already anticipated impacts of the coronavirus, which would consume
more of the company's liquidity and delay the pace and scope of the
recovery in demand, the retirement of debt and the strengthening of
credit metrics versus Moody's current expectations. Nonetheless,
adequate liquidity currently mitigates further downwards pressure
on JetBlue's corporate family rating.
The confirmation of the EETC ratings reflect the importance of the
A321-200 aircraft in the collateral to the company's operations and
supportive equity cushions. Moody's believes having 40% of the
company's A321ceo fleet -- many with the company's higher-yielding,
premium MINT cabin -- in the collateral supports a high likelihood
that JetBlue would affirm this transaction if it declared
bankruptcy.
LIQUIDITY
JetBlue's adequate liquidity profile is characterized by its
estimate of cash and short-term investments of $2.2 billion as of
April 30, 2020. JetBlue arranged a $1 billion, 364-day facility
that expires in March 2021. On April 22nd, the company drew the
$550 million revolver that expires in August 2023. JetBlue has
received $936 million under the Payroll Support Program of the US
Coronavirus Aid, Relief, and Economic Security Act. Of this amount,
$251 million will be in the form of a 10-year, unsecured loan. A
CARES Act secured loan of $1.1 billion will also be available to
JetBlue through September 30, 2020, should it decide to utilize
this part of the program. Unsecured assets with estimated value of
about $2 billion remain available for additional financing, if
needed.
A commitment by the US airlines to return on capital and profit
maximization rather than market share strategies, declines in
unemployment rates, and passenger demand and oil price levels will
be key determinants of JetBlue's future cash generation that will
inform the potential pace of deleveraging the capital structure.
JetBlue spent $1.8 billion on fuel and invested $900 million on
capital expenditures and returned $540 million to shareholders in
2019. With the CARES Act prohibition on returns to shareholders for
one year after the repayment of loans, expected significant
reductions in capital expenditures and likely materially lower fuel
prices, there is the potential for JetBlue to sequentially and
cumulatively retire a significant amount of the debt incurred
because of the coronavirus, as demand recovers through 2023.
RATINGS RATIONALE
The Ba2 corporate family rating reflects the company's solid
competitive position in its US East Coast and transcontinental
routes, anchored in its focus cities of New York (JFK International
Airport), Boston, Fort Lauderdale, Los Angeles, Orlando and San
Juan; historically strong credit metrics, including debt-to-EBITDA
of 2.1x at December 31, 2019; and recurring free cash flow. The
company's relatively smaller scale and expected increasing
competitive intensity, particularly from Delta Air Lines and
American Airlines at Boston's Logan Airport, following the
coronavirus, will be a headwind for JetBlue.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The corporate family rating could be downgraded if Moody's believes
the coronavirus will constrain passenger demand for an extended
period and or credit metrics. Aggregate of cash and available
revolver falling below $1.25 billion could pressure the ratings as
could (i) a longer-running decline in passenger bookings beyond its
expectations, or a slower pace of recovery as a result of the
coronavirus outbreak, particularly if not matched by further
additional sources of liquidity; (ii) greater liquidity pressure
from an inability to remove costs and cut capital spending; and/or
(iii) if there are clear expectations that JetBlue will not be able
to timely restore its financial profile once the virus recedes (for
example, if debt-to-EBITDA is sustained above 3.5x, funds from
operations plus interest-to-interest approaches 4x, or retained
cash flow-to-debt is sustained below 20%).
There will be no upwards pressure on the ratings until after
passenger demand returns to pre-coronavirus levels, JetBlue
maintains liquidity above $1.5 billion, and key credit metrics
improve such that EBIT margins remain above 18%, debt-to-EBITDA is
sustained below 2.5x as the company reshapes its fleet with A220
and A321 aircraft, and funds from operations plus
interest-to-interest is above 8x.
Ratings on corporate (non-EETC) debt instruments could change with
no change in the corporate family rating because of changes in the
relative contribution of senior secured and senior unsecured
obligations in Moody's Loss Given Default waterfall. For example,
the $251 million loan portion of the CARES Act Payroll Support
Payments is an unsecured obligation; the $1.1 billion CARES Act
loan, if drawn, will be secured. The previously arranged $1 billion
364-day facility also increased secured claims in the LGD
waterfall, which will be sustained if termed out by the maturity
date in March 2021. Adding either materially larger amounts of
secured debt than unsecured debt or material amounts of one but not
the other can lower the ratings of each class.
Changes in the EETC ratings can result from any combination of
changes in the underlying credit quality or ratings of the company,
Moody's opinion of the importance of the aircraft collateral to the
company's operations, and/or its estimates of current and projected
aircraft market values, which will affect estimates of
loan-to-value.
The methodologies used in these ratings were Passenger Airline
Industry published in April 2018.
The following rating actions were taken:
Downgrades:
Issuer: JetBlue Airways Corp.
Corporate Family Rating, Downgraded to Ba2 from Ba1
Probability of Default Rating, Downgraded to Ba2-PD from Ba1-PD
Speculative Grade Liquidity Rating, Downgraded to SGL-3 from SGL-2
Senior Secured Bank Credit Facility, Downgraded to Ba1 (LGD3) from
Baa3 (LGD3)
Confirmations:
Issuer: JetBlue Airways Corp.
Senior Secured Enhanced Equipment Trust, Confirmed at A1
Senior Secured Enhanced Equipment Trust, Confirmed at A3
Outlook Actions:
Issuer: JetBlue Airways Corp.
Outlook, Changed To Negative From Rating Under Review
JetBlue Airways Corp., based in Long Island City, New York,
operates a low-cost, point-to-point airline from its primary focus
cities -- New York from John F. Kennedy International airport,
Boston, Fort Lauderdale and Los Angeles. In 2019, JetBlue served
103 cities with an average of 1,000 daily flights. The company
reported revenue of $7.8 billion for the last twelve months ended
March 31, 2020.
JOHN BARRETT: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Lead Debtor: John Barrett Inc.
36 E 57th Street
New York, NY 10022
Business Description: John Barrett Inc. is in the hair salon
business offering hair cut, color,
conditioning treatments, and straightening
treatments. It also provides nail
enhancements and skin care services.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Southern District of New York
Two affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
John Barrett Inc. 20-11318
Mezz57th LLC 20-11316
Judge: Hon. Sean H. Lane
Debtors' Counsel: Vincent Roldan, Esq.
BALLON STOLL BADER & NADLER, P.C.
729 Seventh Avenue 17 Floor
New York, NY 10019
Tel: 212-575-7900
Email: vroldan@ballonstoll.com
John Barrett Inc.'s
Estimated Assets: $1 million to $10 million
John Barrett Inc.'s
Estimated Liabilities: $0 to $50,000
Mezz57th LLC's
Estimated Assets: $1 million to $10 million
Mezz57th LLC's
Estimated Liabilities: $1 million to $10 million
The petitions were signed by John Barrett, president and managing
member.
The Debtors failed to include in the petitions lists of their 20
largest unsecured creditors at the time of the filing.
Copies of the petitions are available for free at PacerMonitor.com
at:
https://is.gd/asEco1
https://is.gd/ogouE7
KRYSTAL CO: Sells Itself Out of Bankruptcy by Takeover Deal
-----------------------------------------------------------
Aisha Al-Muslim, writing for Wall Street Journal, reports
quick-service burger restaurant chain Krystal Co., that filed for
bankruptcy in January 2020, successfully came out of bankruptcy by
selling the company to Fortress Investment Group LLC.
Krystal sells itself out of bankruptcy to an affiliate of its
senior lender Fortress Investment Group LLC in the form of credit
bid worth $27 million, where Fortress will buy Krystal in exchange
for the cancellation of its debt. The sale, scheduled to close in
May 2020, also includes the assumption of liabilities up to $21.5
million by Fortress.
Judge Paul W. Bonapfel of the U.S. Bankruptcy Court in Atlanta said
Wednesday that he will approve the deal Krystal with Fortress to
sell substantially all of its assets, including about 170
corporate-owned locations in nine U.S. states. Krystal also has
about 100 additional franchise locations.
"We do have a surviving going concern, albeit with different
ownership," Judge Bonapfel said during a court hearing Wednesday,
held by telephone conference. "Employees, customers, suppliers,
landlords are all served by this agreement."
Krystal was forced to close all its dining room operations because
of the COVID-19 pandemic but continued to serve customers using its
drive-through and delivery service, Krystal's bankruptcy lawyer
Sarah R. Borders of King & Spalding LLP said during the hearing.
Krystal's revenue fell significantly and it took actions to
preserve liquidity, including workforce and expense reductions, she
added.
Prior to the pandemic, Krystal had over 10 probable interested
buyers but it quickly changed and left the company facing broken
sale process as well as complete liquidation, said Ms. Borders
during the hearing.
Krystal opted the company to Fortress, after receiving an offer
from multifamily-owned private equity company Nashville Capital
Group LLC, for $1 million plus the assumption of liabilities worth
over $20 million because the bid of Fortress exceeds the offer of
Nashville by at least around $26 million.
According to Fortress' lawyers Jonathan Edwards of Alston & Bird
LLP during the hearing, the affiliates of Fortress had extensive
experience in restaurant space, including its present or prior
investments in Qdoba Restaurant Corp, Taco Mac Restaurant Group,
Bojangles Inc., TGI Friday, and others. Majority of Krystal's
present management team will continue to manage the brand after the
closure of the deal.
About The Krystal Company
Founded in Chattanooga, Tenn., in 1932, The Krystal Company --
http://www.krystal.com/-- is a quick-service restaurant chain with
locations in the Southeastern United States. It is known for its
small, square hamburgers, served fresh and hot off the grill on the
iconic square bun at approximately 320 restaurants in nine states.
Krystal's Atlanta-based Restaurant Support Center serves a team of
7,500 employees.
The Krystal Company, and affiliates Krystal Holdings, Inc., and
K-Square Acquisition Co., LLC, sought Chapter 11 protection (Bankr.
N.D. Ga. Case No. No. 20-61065) on Jan. 19, 2020.
The Debtors tapped King & Spalding LLP as legal counsel; Scroggins
& Williamson, P.C. as conflicts counsel; Piper Jaffray as
investment banker; and Kurtzman Carson Consultants, LLC as claims
agent. Alvarez & Marsal provides interim management to the
Debtors.
LIBERTY OILFIELD: Considers Bankruptcy Filing Again
---------------------------------------------------
Liberty Oil Field Services LLC is considering filing Chapter 11
bankruptcy protection again, The Wall Street Journal reported,
citing people familiar with the matter.
In 2018, Liberty went through similar bankruptcy cycle. In 2020,
it already failed in making due interest payments and hired
financial advisors to steer the company through the said terrain.
According to BDC Credit Reporter, this isn't unexpected but this is
bad news for the three business development companies with senior
debt exposure worth $21.1 million. These BDCs include Investcorp
Credit Management (ICMB); Owl Rock Capital (ORCC) and non-traded
Owl Rock Capital II. There's $1.8mn of investment income in play
and that is apparently and already effectively on non accrual.
About Liberty Oil Field Services
Liberty Oilfield Services Inc. is an oilfield service company
founded on Dec. 21, 2016 that specializes in hydraulic fracturing,
stimulation, and engineering services to production companies,
natural gas exploration, and onshore oil companies. It services
customers throughout the U.S.
LONGVIEW POWER: Court Confirms Plan of Reorganization
-----------------------------------------------------
Longview Power achieved an important milestone on May 22, 2020,
when Judge Shannon of the United States Bankruptcy Court for the
District of Delaware issued an order confirming the Company's
prepackaged chapter 11 plan of reorganization after a brief
uncontested hearing.
Longview Power filed bankruptcy protection on April 14 citing debt
maturities occurring during an extended period of unprecedented low
energy prices and the economic effects of the COVID-19 pandemic on
the power generation industry. The Company commenced its cases
with the support of its secured lenders after months of discussion
between the Company, its secured lenders, and its equity owners.
The Company's plan of reorganization was unanimously supported by
the Company's senior secured lenders and no objections were filed.
Under Longview Power's reorganization plan, $350 million of secured
and subordinated debt will be extinguished, existing equity will be
cancelled, and the Company's senior secured debt holders will
become its new equity owners. Upon emergence from bankruptcy,
Longview Power will receive a $40 million term loan funded by its
new owners to support its expected working capital and capital
needs for the next five years. All other creditors of the Company,
as well as the Company's employees, are unaffected by the plan.
The Company will emerge from bankruptcy once certain governmental
filings and approvals occur, expected by mid-summer.
Jeffery Keffer, CEO of Longview Power, stated, "Significant hard
work and cooperation by the Company's senior secured creditors, the
Company's existing equity holders, the Company, and their
professionals were critical to making confirmation happen so
quickly. The overwhelming support shown for the plan reflects the
unique and special characteristics of the Longview Power plant, one
of the cleanest coal fired power plants in the world and a highly
reliable and low cost producer of electricity in West Virginia and
the PJM region. With this plan of reorganization in place and the
financial support of its new owners, Longview Power will be well
positioned to build its planned natural gas and solar powered
facilities and become a leading 'all of the above' power producer
for many years to come."
About Longview Power
Longview Power, LLC, together with Longview Intermediate Holdings
C, LLC and its non-debtor affiliates, operates a 710 megawatt
advanced supercritical coal fired power generation facility located
in Maidsville, West Virginia that uses equipment, processes,
designs, and technology developed specifically for use at the
Maidsville site. Longview is a privately owned power company that
was formed in 2003 for the purpose of constructing and operating
the coal-burning Longview Plant in Monongalia County, West
Virginia.
Longview Power, LLC and affiliate Longview Intermediate Holdings C,
LLC sought Chapter 11 protection (Bankr. D. Del. Lead Case No.
20-10951) on April 14, 2020.
Longview Power was estimated to have $100 million to $500 million
in assets and liabilities as of the bankruptcy filing.
The Debtor tapped KIRKLAND & ELLIS LLP as bankruptcy counsel;
RICHARDS, LAYTON & FINGER, P.A., as local counsel; 3CUBED ADVISORY
SERVICES, LLC as restructuring advisor; and HOULIHAN LOKEY, INC. as
financial advisor. DONLIN, RECANO & COMPANY, INC. is the claims
agent.
LSC COMMUNICATIONS: Lowenstein Represents CNG, 4 Others
-------------------------------------------------------
In the Chapter 11 cases of LSC Communications, et al., the law firm
of Lowenstein Sandler LLP submitted a verified statement under Rule
2019 of the Federal Rules of Bankruptcy Procedure, to disclose that
it is representing Central National Gottesman Inc., International
Paper Company, HarperCollins Publishers LLC, Penguin Random House
LLC, and Sourcebooks, Inc.
Lowenstein was retained separately by each of the Creditors in
connection with the above captioned bankruptcy cases and does not
represent an ad hoc group or an official or unofficial committee.
CNG's claims against the Debtors and other economic interests
relevant to the Debtors' chapter 11 cases are:
* On the Petition Date, the Debtors held goods subject to CNG's
consignment and bailment rights, which goods were stored at one
or more of the Debtors' owned or leased warehouses. CNG's consigned
and bailed goods are CNG's property, and not the Debtors' property,
pursuant to the Debtors' agreements with CNG, and as further
confirmed in the: (a) Customer Programs Motion and Customer
Programs Order; and (b) DIP Financing Motion, DIP Financing Interim
Order, and any final order. The amount of CNG's consigned and
bailed goods has continued to increase and/or decrease after the
Petition Date as CNG's consigned and bailed goods are constantly
consumed, replenished, released, and/or shipped.
* On the Petition Date, Lindenmeyr Munroe, a division of CNG,
had a prepetition claim against the Debtor, LSC Communications US,
LLC, in the approximate amount of $2,825,400, subject to recoupment
and/or setoff against the Debtors under the terms of their
contract(s) and/or applicable law, of which approximately
$1,799,721 of which is entitled to priority treatment pursuant to
section 503(b)(9) of the Bankruptcy Code.
* On the Petition Date, CNG had a prepetition claim against the
Debtor, Continuum Management Company, LLC, in the approximate
amount of $398,139 (which amount includes approximately $145,806.58
of inventory held at various printers for the account of Continuum
for which it had not yet been invoiced), subject to CNG's
recoupment and/or setoff rights under the terms of their
contract(s) and/or applicable law.
* CNG also has a contingent and unliquidated claim against the
Debtors in the event the Debtors reject any contract to which CNG
is a counterparty.
* The claims of CNG and its divisions and subsidiaries against
the Debtors as of the Petition Date were fully secured by a standby
letter of credit in the amount of $4,000,000, and as further
security, CNG has a right of recoupment and/or setoff against the
Debtors under the terms of their contract(s) and/or applicable
law.
IP's claims against the Debtors and other economic interests
relevant to the Debtors' chapter 11 cases are:
* On the Petition Date, the Debtors held consigned goods stored
at one or more of the Debtors' owned or leased warehouses with a
value of approximately $3,051,924, which consigned goods are IP's
property, and not the Debtors' property, pursuant to the Debtors'
agreements with IP, and as further confirmed in the: (a) Customer
Programs Motion and Customer Programs Order; and (b) DIP Financing
Motion, DIP Financing Interim Order, and any final order. The
amount of IP's consigned goods has continued to increase and/or
decrease after the Petition Date as IP's consigned goods are
constantly consumed and replenished.
* On the Petition Date, IP had a general unsecured claim against
the Debtors in the approximate amount of $1,874,521, subject to
IP's rights of recoupment and/or setoff.
* IP also has a contingent and unliquidated claim against the
Debtors in the event the Debtors reject any contract to which IP is
a counterparty.
* IP has a right of recoupment and/or set off against the
Debtors under the terms of their contract(s) and/or applicable
law.
HC's claims against the Debtors and other economic interests
relevant to the Debtors' chapter 11 cases are as follows:
* On April 10, 2020, the Debtors held goods consisting of
finished goods, paper, work in progress or work in process, stored
at one or more of the Debtors' owned or leased warehouses, subject
to HC's bailment rights in the approximate amount of approximately
$108,328,455, at HC's cost, which bailed goods are HC's property,
and not the Debtors' property, pursuant to the Debtors' agreements
with HC, and as further confirmed in the: (a) Customer Programs
Motion and Customer Programs Order; and (b) DIP Financing Motion,
DIP Financing Interim Order, and any final order. The amount of
HC's bailed goods has continued to increase and/or decrease after
the Petition Date as HC's bailed goods are constantly replenished
and released or shipped.
* On April 10, 2020, HC had an unsecured claim against the
Debtor, LSC Communications US, LLC, based upon accrued volume
rebates and other obligations of LSC to HC arising from work and
services that LSC provided to HC prior to the Petition Date, for
which HC asserts recoupment and/or setoff rights under the terms of
their contract(s) and/or applicable law.
* HC also has a contingent and unliquidated claim against the
Debtors in the event the Debtors reject any contract to which HC is
a counterparty.
* HC has a right of recoupment and/or setoff rights under the
terms of their contract(s) and/or applicable law.
PRH's claims against the Debtors and other economic interests
relevant to the Debtors' chapter 11 cases are as follows:.
* As of May 1, 2020, the Debtors held: (i) print and hold books
valued, at total manufacturing unit cost, at approximately
$2,600,000; (ii) paper valued, at PRH's cost, at approximately
$9,500,000; (iii) components, consisting of jackets and covers,
valued, at replacement cost, at approximately $680,000; and (iv)
electronic files/titles valued, at replacement cost, at
approximately $6,000,000, for a total approximate value of
$18,780,000. PRH's goods, subject to its bailment rights, are
stored at one or more of the Debtors' owned or leased warehouses.
PRH's bailed goods are PRH's property, and not the Debtors'
property, pursuant to the Debtors' agreements with PRH, and as
further confirmed in the: (a) Customer Programs Motion and Customer
Programs Order; and (b) DIP Financing Motion, DIP Financing Interim
Order, and any final order. The amount of PRH's bailed goods has
continued to increase and/or decrease after May 1, 2020 as PRH's
bailed goods are constantly replenished and released or shipped.
* On the Petition Date, PRH had a general unsecured claim
against LSC Communications US, LLC, subject to PRH's recoupment
and/or set off rights against the Debtors under the terms of their
contract(s) and/or applicable law, as follows:
a. A credit in the amount of $2,445,402.44, acknowledged by
LSC;
b. An unsecured claim in the amount of $37,213.60; and
c. Accrued rebates, credits, and other obligations of LSC to
PRH arising from work and services that LSC provided to PRH prior
to the Petition Date, which are subject to PRH's right of
recoupment and/or set off against the Debtors under the terms of
their contract(s) and/or applicable law.
* PRH also has a contingent and unliquidated claim against the
Debtors in the event the Debtors reject any contract to which PRH
is a counterparty.
* PRH has a right of recoupment and/or set off against the
Debtors under the terms of their contract(s) and/or applicable
law.
Sourcebooks' claims against the Debtors and other economic
interests relevant to the Debtors' chapter 11 cases are:
* On the Petition Date, the Debtors held goods, subject to
Sourcebooks' bailment rights, in the approximate amount of
$12,136,237.22, at Sourcebooks' cost, consisting of finished goods,
paper, work in progress or work in process, and other goods stored
at one or more of the Debtors' owned or leased warehouses.
Sourcebooks' bailed goods are Sourcebooks' property, and not the
Debtors' property, pursuant to the Debtors' agreements with
Sourcebooks, and as further confirmed in the: (a) Customer Programs
Motion and Customer Programs Order; and (b) DIP Financing Motion,
DIP Financing Interim Order, and any final order. The amount of
Sourcebooks' bailed goods has continued to increase and/or decrease
after the Petition Date as Sourcebooks' bailed goods are constantly
replenished and released or shipped.
* On the Petition Date, LSC Communications, Inc. and/or other
Debtors were indebted to Sourcebooks for accrued rebates relating
to services provided to Sourcebooks prior to the Petition Date,
which are subject to Sourcebooks recoupment and/or setoff rights
under the terms of their contract(s) and/or applicable law.
* Sourcebooks also has a contingent and unliquidated claim
against the Debtors in the event the Debtors reject any contract to
which Sourcebooks is a counterparty.
* Sourcebooks has a right of recoupment and/or set off against
the Debtors under the terms of their contract(s) and/or applicable
law.
Lowenstein does not believe that there is any actual or potential
conflicts of interests with respect to the representation of the
Creditors in these cases.
Lowenstein has no claims against, or interests in, the Debtors.
Lowenstein reserves the right to supplement and/or amend this
2019 statement at any time in the future.
The Debtors each filed for relief pursuant to chapter 11 of the
Bankrutpcy Code on April 13, 2020. On the Petition Date, the
Debtors filed certain "first day" motions for which the Court has
entered interim and/or final orders, including: Debtors' Motion for
Entry of Interim and Final Orders (I) Authorizing, but not
Directing, the Debtors to Maintain their Customer Programs and
Honor Related Prepetition Obligations, (II) Authorizing Banks and
Other Financial Institutions to Honor and Process Related Checks
and Transfers and (III) Granting Related Relief [Docket No. 11, 11
and 21]; Final Order (I) Authorizing, but not Directing, the
Debtors to Maintain their Customer Programs and Honor Related
Prepetition Obligations, (II) Authorizing Banks and Other Financial
Institutions to Honor and Process Related Checks and Transfers and
(III) Granting Related Relief [Docket No. 212, 5]; Debtors’
Motion for Entry of Interim and Final Orders, Pursuant to 11 U.S.C.
Section 105, 361, 362, 363, 364, 503, 506, 507 and 552, (I)
Authorizing the Debtors to Obtain Senior Secured Superpriority
Postpetition Financing, (II) Granting Liens and Superpriority
Administrative Expense Claims, (III) Authorizing the Use of Cash
Collateral, (IV) Granting Adequate Protection, (V) Modifying the
Automatic Stay, (VI) Scheduling a Final Hearing and (VII) Granting
Related Relief [Docket No. 14, 5]; Interim Order (I) Authorizing
the Debtors to Obtain Senior Secured Superpriority Postpetition
Financing, (II) Granting Liens and Superpriority Administrative
Expense Claims, (III) Authorizing the Use of Cash Collateral, (IV)
Granting Adequate Protection, (V) Modifying the Automatic Stay,
(VI) Scheduling a Final Hearing and (VII) Granting Related Relief
[Docket No. 35, 5 and 57].
Counsel for Central National Gottesman Inc., International Paper
Company, HarperCollins Publishers LLC, PRH Random House LLC, and
Sourcebooks, Inc. can be reached at:
LOWENSTEIN SANDLER LLP
Bruce S. Nathan, Esq.
Bruce Buechler, Esq.
Eric S. Chafetz, Esq.
Phillip Khezri, Esq.
1251 Avenue of the Americas
New York, NY 10020
Tel: (212) 262-6700
Fax: (212) 262-7402
E-mail: bnathan@lowenstein.com
bbuechler@lowenstein.com
echafetz@lowenstein.com
pkhezri@lowenstein.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://is.gd/V7y354
About LSC Communications
LSC Communications, Inc. -- http://www.lsccom.com/-- is a Delaware
corporation established in 2016 with its headquarters located in
Chicago, Illinois. The Company offers a broad range of traditional
and digital print products, print-related services, and office
products. The Company serves the needs of publishers,
merchandisers, and retailers worldwide, with a service offering
that includes e-services, logistics, warehousing and fulfillment
and supply chain management services. The Company prints
magazines, catalogs, directories, books, and some direct mail
products, and manufactures office products, including filing
products, envelopes, note-taking products, binder products, and
forms. The Company has offices, plants, and other facilities in 28
states, as well as operations in Mexico, Canada, and the United
Kingdom.
LSC Communications, Inc., based in Chicago, IL, and its
debtor-affiliates, filed a Chapter 11 petition (Bankr. S.D.N.Y.
Lead Case No. 20-10950) on April 13, 2020. In its petition, the
Debtor disclosed $1,649,000,000 in assets and $1,721,000,000 in
liabilities. The petition was signed by Andrew B. Coxhead, chief
financial officer.
The Debtors hire SULLIVAN & CROMWELL LLP as counsel; YOUNG CONAWAY
STARGATT & TAYLOR, LLP, as co-counsel; EVERCORE GROUP L.L.C., as
investment banker; ALIXPARTNERS LLP as restructuring advisor; PRIME
CLERK LLC as notice, claims and balloting agent.
LUX TEMPLUM: Files Bankruptcy Protection to Keep Business Alive
---------------------------------------------------------------
Lily O'Neill, writing for Business Den, reports that Denver-based
hemp consulting firm Lux Templum LLC sought Chapter 11 bankruptcy
protection to reorganize and to help keep its business alive by
timely paying creditors.
Lux Templum describes itself on its website as a management and
consulting company that "works with companies, governments and
capital allocators around the world to help foster a thorough
understanding of the hemp industry and how they may choose to
participate in it."
According to Lux's website, its CFO John Lawrence signed the
Chapter 11 bankruptcy filing on behalf of the company and used its
downtown address Denver apartment as office address and stated
Christoper Brown as its CEO.
In the filing, it owed $1.4 million to its largest creditor, the
Denver-based P2Bi Holdings LLC, in connection with a September 2019
dryer loan, but Lux Templum disputes that claim.
About Lux Templum
Lux Templum, LLC -- https://www.luxtemplum.com/ -- provides support
activities for crop production. The Company offers processing and
sales facilitation and consulting and management services to the
hemp industry. Lux Templum works with companies, governments and
capital allocators around the world to help foster a thorough
understanding of the hemp industry and how they may choose to
participate in it.
Lux Templum sought Chapter 11 protection (Bankr. D. Colo. Case No.
20-13360) on May 15, 2020. In the petition signed by CFO John
Lawrence, the Debtor disclosed total assets of $421,985 and total
liabilities of $2,804,713 as of the bankruptcy filing. The Hon.
Michael E. Romero is the case judge. SHILLIDAY LAW, P.C., led by
Robert J. Shilliday III, is the Debtor's counsel.
LVI INTERMEDIATE: Case Summary & 30 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: LVI Intermediate Holdings, Inc.
d/b/a Vision Group Holdings
f/k/a SD II Eyeglasses Blocker Corp.
1555 Palm Beach Lakes Boulevard, Suite 600
West Palm Beach, FL 33401
Business Description: Headquartered in West Palm Beach,
Florida, LVI Intermediate Holdings dba
Vision Group Holdings develops and
manages, through its various
subsidiaries, among other businesses,
two of the leading LASIK surgery brands
in the nation: The LASIK Vision
Institute and TLC Laser Eye Centers.
The Company also owns and manages
certain select general ophthalmology
practices and QuaslightLasik, a
licensed Preferred Provider Organization
for LASIK surgery providers.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
District of Delaware
Eighteen affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
LVI Intermediate Holdings, Inc. (Lead) 20-11413
Total Vision Institute, LLC 20-11414
QualSight, LLC 20-11415
The LASIK Vision Institute, LLC 20-11416
Cataract Vision Institute, LLC 20-11417
Healthcare Marketing Services, LLC 20-11418
Cataract Vision Institute Florida, LLC 20-11419
TLC Vision Center Holdings, LLC 20-11420
TLC Whitten Laser Eye Associates, LLC 20-11421
TLC Vision Centers, LLC 20-11422
TruVision, LLC 20-11423
TruVision Contacts, LLC 20-11424
Laser Eye Surgery, LLC 20-11425
TLC Laser Eye Centers (Refractive I), LLC 20-11426
TLC The Laser Center (Pittsburgh) L.L.C. 20-11427
TLC The Laser Center (Indiana) LLC 20-11428
TLC The Laser Center (Institute), LLC 20-11429
LVI Missouri, LLC 20-11430
Judge: Hon. Karen B. Owens
Debtors' Counsel: Norman L. Pernick, Esq.
David G. Dean, Esq.
COLE SCHOTZ P.C.
500 Delaware Avenue, Suite 1410
Wilmington, DE 19801
Tel: (302) 652-3131
Fax: (302) 652-3117
E-mail: npernick@coleschotz.com
ddean@coleschotz.com
Debtors'
Financial
Advisor: ALVAREZ & MARSAL CAPITAL
Debtors'
Investment
Banker: RAYMOND JAMES & ASSOCIATES, INC.
Debtors'
Noticing &
Claims
Agent: DONLIN RECANO & COMPANY, INC.
https://is.gd/aEx8vJ
Estimated Assets
(on a consolidated basis): $1 million to $10 million
Estimated Liabilities
(on a consolidated basis): $100 million to $500 million
The petitions were signed by Lisa Melamed, interim CEO.
A copy of LVI Intermediate Holdings' petition is available for free
at PacerMonitor.com at:
https://is.gd/UxgG6F
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Alcon Laboratories Inc. Master $6,125,502
PO Box 677775 Equipment
Dallas, TX 75267-7775 Lease
Attn: Brent Polly
Tel: (703) 328-6166
Email: brent.polly@alcon.com
Tel: (817) 317-8769
Email: Instrumentation.CS@alcon.com;
asa.cs@alcon.com;
ar.payments@alcon.com
2. American Express Trade Debt $4,842,503
PO Box 650448
Dallas, TX 75265-0448
Attn: Austin Siegfried
Tel: (212) 640-0989
Email: austin.siegfried@aexp.com
3. Google Inc. Marketing $434,450
1600 Amphitheatre Pkwy Services
Mountain View, CA 94043
Jefferson Entrampas Jr.
Tel: (630) 718-7028
Email: jeffersone@google.com
4. Ziemer U.S.A. Trade Debt $318,062
620 E 3rd Street
Alton, IL 62002
Attn: Carol Depping or Beth Pratt
Tel: (866) 708-4472
Email: Carol.Depping@Ziemergroup.com;
Beth.Pratt@Ziemergroup.com
5. Centurylink Utilities $315,996
PO Box 52187
Phoenix, AZ 85072-2187
Attn: Miguel Zelaya
Tel: (954) 940-7107
Email: Miguel.Zelaya@Centurylink.com
6. Davis Vision, Inc. Professional $250,000
175 East Houston Street Services
San Antonio, TX 78205
Attn. Pat Cervino
Office: 210.524.6946
Email: Pat.Cervino@versanthealth.com
7. Henry Schein Inc. Trade Debt $246,499
PO Box 371952
Pittsburgh, PA 15250-7952
Attn: Heather Stephens
Tel: (844) 223-9902 x2352128
Email: Heather.stephens@henryschein.com
8. Staples Advantage Trade Debt $236,415
Dept. Atl
PO Box 105748
Atlanta, GA 30348-5748
Attn: Jamie Thomas
Tel: (800) 387-8375
Email: ARCreditCardTeam@staples.com
StaplesCreditSD@Staples.com
9. Facebook Inc. Professional $192,874
607 W. 3rd St Services
Austin, TX 78701
Ellie Levine
Tel: (650) 788-4557
Email: ellielevine@fb.com
10. Amobee Inc. Professional $187,904
PO Box 894409 Services
Los Angeles, CA 90189
Attn: Megan Reifeiss
Tel: (858) 829-5886
Email: megan.reifeiss@amobee.com
Tel: (650) 802-8871
Email: clientacctg-us@amobee.com
11. Rosenberg Media Professional $163,213
14413 Autumn Branch Terrace Services
Boyds, MD 20841
Attn: Jay Rosenberg
Tel: (301) 793-4257
Email: jay@rosenbergmedia.com
12. AMO Sales and Service Inc. Trade Debt $153,247
PO Box 74007099
Chicago, IL 60674-7099
Attn: Gerard Shin
Tel: (866) 483-6170
Email: gshin2@its.jnj.com
13. Tower 1555 Property $152,643
1555 Palm Beach Lakes Blvd. Rent
Suite 1100
West Palm Beach, FL 33401
Attn: Debra Lawson
Tel: (561) 686-1555
Email: dlawson@ecclestone.com
propertyadmin@ecclestone.com
14. Alorica Inc. Professional $124,402
PO Box 748624 Services
Los Angeles, CA 90074
Attn: Mark Vander Beek
Tel: (954) 693-3848
Email: Mark.vanderBeek@Alorica.com
15. Vincodo LLC Professional $117,017
1554 Clark Drive Services
Yardly, PA 19067
Attn: Tim Daly
Tel: (267) 438-7774
Email: tdaly@vincodo.com
16. Marketing Architects Marketing $115,512
110 Cheshire Lane Services
Suite 200
Minneapolis, MN 55305
Attn: B. Quarberg
Tel: (952) 449-2500
Email: bquarberg@markarch.com
17. Secured Communications, Inc. Professional $96,703
3249 SE Quay Street Services
Port St. Lucie, FL 34984
Attn: Steve Synenko
Tel: 772-618-0087
Email: scisystems@gmail.com
18. Oasis Medical Inc. Medical $95,623
514 South Vermont Avenue Supplies
Glendora, CA 91741
Attn: Monica Loera
Tel: (844) 820-8940 x402
Email: mloera@oasismedical.com
19. RP Aventine Office Owner, Property $93,466
L.L.C. Rent
3953 Maple Avenue
Suite 300
Dallas, TX 75219
Attn: M. Gonzalez
Tel: (858) 926-5300
Email: mgonzalez@rockhillmanagement.com
20. HW Hollinger (Canada) Inc. Insurance $88,006
550, Rue Sherbrooke O
Suite 2070
Montreal, Quebec H3A1B9
Attn: Roberto Mancuso
Tel: (514) 842-8421
Email: info@hwhollinger.com
21. MetLife Group Insurance $80,719
Benefits/MetLife Small
Business Center
Box # 804466
811 Main Street, 7th Floor
Kansas City, MO 64180-4466
Attn: Shanna Curry
Tel: (813) 673-3835
Email: shanna.curry@metlifeservice.com
22. MicroSoft Online, Inc. Professional $75,882
PO Box 847543 Services
Dallas, TX 75284-7543
Dillon Ayers
Tel: (646) 624-5479
Email: diayers@microsoft.com
23. Neustar Info Services Inc. Professional $72,317
Bank of America Services
PO Box 742000
Atlanta, GA 30374-2000
Attn: Homan Haghari
Tel: (855) 645-4399
Email: nisbilling@neustar.biz
support-infoservices@team.neustar
24. Ronbet 437 LLC Property Rent $62,447
c/o Joseph P. Day Realty
Corporation
9 East 40th Street
New York, NY 10016
Attn: Richard Brickell
Tel: (212) 889-7460
Email: rjb@jpday.com
25. BVI/Beaver-Visitec Trade Debt $56,457
International
500 Totten Pond Rd-10, City
Point, MA, 02451
Remit: PO Box 734261
Chicago, IL 60673-4261
Attn: Michael Chin
Tel: (866) -906-6808
Email: customersupport@bvimedical.com;
michael_chin@beaver-visitec.com;
AR@BVIMedical.com
26. MedPro Group Professional $55,842
5814 Reed Road Services
Fort Wayne, IN 46835
Attn: Alexis Fries
Tel: (260) 486-0382
Email: Alexis.Fries@medpro.com
27. iHeartMedia Marketing $54,011
3964 Collection Center Drive Services
Chicago, IL 60693-0039
Attn: Michael Bednarz
Tel: (210) 832-3149
Email: support@iheartradio.com
28. Hansa Ophthalmics LLC-aka Trade Debt $52,357
Precision
4083 NW 79 th Avenue
Doral, FL 33166
Attn: Steve Levesque
Tel: (305) 594-1789
Email: slevesque@hansaophthalmics.com
29. Modus Direct LLC Marketing $50,000
1343 Main Street Services
Suite 600
Sarasota, FL 34236
Attn: Shani Reardon
Tel: (941) 552-6770
Email: shani@modusdirect.com
30. DEX Imaging LLC Professional $48,765
PO Box 17454 Services
Clearwater, FL 33762-0454
Attn: Dan Doyle
Tel: (813) 288-8080
Email: info@deximaging.com
LVI INTERMEDIATE: Vision Group in Chapter 11 to Sell Business
-------------------------------------------------------------
LVI Intermediate and 17 of its affiliates, including the Laser
Vision Institute and TLC Laser Eye Center brands, doing business as
Vision Group Holdings, filed for voluntary protection from
creditors under Chapter 11 of the U.S. Bankruptcy Code in
Delaware.
The filing will facilitate the sale of the company's business as a
going concern. The company's plan is to quickly transition to a new
ownership group through an expected 90-day process and use the time
to restructure and strengthen its balance sheet and debt profile,
while continuing to operate normally. The company's investment
banking advisor reports strong interest from multiple potential
acquirors, including the company's current financial backers. The
company expects to close a sale sometime in September.
"The action we're taking is largely the result of the negative
impact that the COVID-19 pandemic has had on the economy," said
Lisa Melamed, Interim Chief Executive Officer for Vision Group
Holdings.
The planned sale will position the company for future growth,
provide access to capital, and cement the company's industry
leading position.
Melamed confirmed that stay-in-place orders and the mandatory
closure of non-essential businesses including elective medical
procedures forced the company to close all locations and
temporarily lay off most of its team members. She advised however,
"while our centers were closed in response to the pandemic, we are
excited to report that we have started to reopen and are currently
treating new patients."
"We expect to emerge from the proceedings stronger and more viable
than ever for team members, surgeons, patients and partners," she
added. "Already we are seeing strong demand for our services at the
centers we've reopened."
COVID-19 Pandemic
"While 2019 was a devastating year for the refractive industry
generally, and specifically for the Debtors, 2020 was off to a good
start pre-COVID. Among other marketing and operating initiatives,
the Groupon program was modified to keep profit levels on those
eyes consistent with the other lead channels. Even though
February's total volumes were down 3%, the Company's management
team drove several improved pricing initiatives resulting in
increased revenues by 7% YOY. We are confident that, had the
Company not shut down from the COVID pandemic, itwould have had a
very strong year as evidenced by the $2.9M of PF EBITDA through
February," Melamed explains.
"Of course, COVID-19 changed all of that, which brings us to the
need for Chapter 11. Namely, as many companies before us and more
surely to follow, the Company files the Chapter 11 Cases today amid
an unprecedented health crisis which resulted in a temporary and
devastating shutdown of the Debtors' operations. "
Prior to the COVID-19 global pandemic, between its two LASIK
brands, the Company operated approximately 120 LASIK centers
located across 38 states. Similar to virtually every other elective
surgery provider, however, the national response to the COVID-19
pandemic resulted in an extended shutdown of all the Company's
LASIK centers. Existing liquidity constraints, which had already
placed stress on the business, accelerated by the COVID-19 pandemic
and the attendant government stay-at-home orders and edicts
forbidding non-essential medical services and elective surgeries,
precipitated the Debtors' difficult decision to terminate
approximately 833 employees and furlough another 19 employees. At
the time of filing, the Debtors employ approximately 410 employees
in aggregate.
"The Company is hopeful that this situation is temporary, however,
and that these bankruptcy proceedings will provide the liquidity to
reopen most of its locations and pave the way to a successful sale
of the Company's assets to a buyer consisting of lenders in our
current secured lending group, or another strategic or financial
buyer that our proposed investment banker will assist us in
securing through this process. Although there remains considerable
uncertainty as to when federal, state and local governments will
lift restrictions on "non-essential" business operations throughout
the country, the Company hopes to be in a position to return as
many furloughed and terminated employees to work as possible. Over
the past few weeks, as governments have been phasing-out
stay-at-home restrictions, the Company has already reopened
approximately 26 center locations and has plans to fully reopen
with a leaner footprint of approximately 93 centers," the Company
said.
The Company is hopeful that the post-petition loan it is seeking
will provide it with sufficient liquidity to execute the reopening
plan, right size the footprint to the more profitable locations,
and allow for a "free and clear" bankruptcy sale of the business to
a buyer with sufficient funding to operate it post-bankruptcy.
Prepetition Capital Structure
As of the Petition Date, the Debtors calculate that the total
indebtedness is not less than in excess of $160 million under the
prepetition credit facility with LBC Credit Partners III, L.P., as
administrative agent, sole lead arranger and sole bookrunner.
The Debtors owe $6 million to Alcon Laboratories, Inc. for the
lease of certain equipment.
The Debtors also have unsecured obligations to various other
creditors, including (i) ordinary trade creditors, (ii) landlords,
(iii) former executives, and (iv) contingent and disputed
litigation claimants. The Debtors estimate their unsecured debt is
at least $16 million,
As of the Petition Date, 597930 Canada, Inc., a Canadian
corporation indirectly owned and controlled by Mark Cohen, M.D. and
Avi Wallerstein, M.D., owns 84%. Falcon Strategic Partners IV, LP
and Macquarie Sierra Investment Holdings, Inc. each own 8% of LVI
Super.
About Vision Group
Based in West Palm Beach, Vision Group Holdings oversees and
manages two of the leading LASIK surgery providers in the nation:
The LASIK Vision Institute and TLC Laser Eye Centers. The company
has performed more than 3.2 million LASIK eye procedures and is the
industry leader as it serves multiple markets -- 63 cities -- in
the U.S. and Canada.
LVI Intermediate Holdings, Inc., d/b/a Vision Group Holdings, and
17 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead
Case No. 20-11413) on May 29, 2020.
LVI Intermediate was estimated to have $1 million to $10 million in
assets and liabilities of $100 million to $500 million as of the
bankruptcy filing.
The Hon. Karen B. Owens is the presiding judge.
The Debtors tapped COLE SCHOTZ P.C. as counsel; ALVAREZ & MARSAL
CAPITAL as financial advisor; and RAYMOND JAMES & ASSOCIATES, INC.
as the investment banker. DONLIN RECANO & COMPANY, INC. is the
claims agent.
M & C PARTNERSHIP: Administrative Claim to be Paid by Rental Income
-------------------------------------------------------------------
Debtor M & C Partnership, LLC, filed an Amended Plan of
Reorganization and a Disclosure Statement on May 8, 2020.
The only payments due on Effective Date will be unpaid Chapter 11
administrative claims of professionals, which the Debtor believes
will total approximately $12,500 as of the Confirmation Date,
outstanding fees to the Office of the United States Trustee
(estimated to be approximately $0.00), which amounts shall be
funded from the Debtor's rental income.
The Class 2 Girod LoanCo, LLC is unimpaired. The Debtor intends to
object to Girod's POC No. 1 in the amount of $570,000.
Holders of Class 3 Allowed Unsecured Claims will be paid the full
amount of their allowed claims no later than six months after the
Effective Date.
A full-text copy of the Amended Plan of Reorganization dated May 8,
2020, is available at https://tinyurl.com/ydxc98z4 from
PacerMonitor.com at no charge.
The Debtor is represented by:
THE CONGENI LAW FIRM, L.L.C.
Leo D. Congeni
650 Poydras St., Suite 2750
New Orleans, LA 70130
Telephone: 504-522-4848
Facsimile: 504-910-3055
E-mail: leo@congenilawfirm.com
About M & C Partnership
M & C Partnership, LLC, a company based in Metairie, La., filed a
Chapter 11 petition (Bankr. E.D. La. Case No. 19-11529) on June 5,
2019. In the petition signed by George A. Cella, III, member and
manager, the Debtor estimated $500,000 to $1 million in assets and
$1 million to $10 million in liabilities. The Hon. Elizabeth W.
Magner oversees the case. Leo D. Congeni, Esq., at Congeni Law
Firm, LLC, serves as the Debtor's bankruptcy counsel. Patrick J.
Gros, CPA, APAC, is the Debtor's accountant.
MARIA O. MARIA: Seeks to Hire Courtney K. Davy as Legal Counsel
---------------------------------------------------------------
Maria O. Maria, LLC, seeks authority from the United States
Bankruptcy Court for the Southern District of New York (Manhattan)
to hire the Law Office of Courtney K. Davy, as its legal counsel.
Services the attorneys will render are:
a. give advice to the Debtor with respect to their powers and
duties as Debtor-in-Possession and the continued management of
their property and affairs;
b. negotiate with creditors of the Debtor and work out a plan
of reorganization and take the necessary legal steps in order to
effectuate such a plan including, if need be, negotiations with the
creditors and other parties in interest;
c. prepare the necessary answers, orders, reports and other
legal papers required for the Debtor who seek protection from their
creditors under Chapter 11 of the Bankruptcy Code;
d. appear before the Bankruptcy Court to protect the interest
of the Debtor and to represent the Debtor in all matters pending
before the Court;
e. attend meetings and negotiate with representatives of
creditors and other parties in interest;
f. advise the Debtor in connection with any potential
refinancing of secured debt and any potential sale of the business
and its assets;
g. represent the Debtor in connection with obtaining
post-petition financing.
h. take any necessary action to obtain approval of a
disclosure statement and confirmation of a plan of reorganization;
and
i. perform all other legal services for the Debtor which may
be necessary for the preservation of the Debtor’s estates and to
promote the best interests of the Debtor, their creditors and its
estates.
The firm's 2019-2020 hourly rates range form $350 to $400 for
attorneys and $150 for paraprofessionals.
The Law Office of Courtney K. Davy Firm is a "disinterested person"
as that phrase is defined in section 101(14) of the Bankruptcy
Code, according to court filings.
The firm can be reached through:
Courtney K. Davy, Esq.
Law Office of Courtney K. Davy
299 Broadway, 1700
New York, NY 10007
Phone: +1 516-850-1800
About Maria O. Maria, LLC
Maria O. Maria, LLC is a Single Asset Real Estate debtor (as
defined in 11 U.S.C. Section 101(51B)).
Maria O. Maria, LLC, filed its voluntary petition under Chapter 11
of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 19-13738) on Nov.
29, 2019. In the petition signed by Maria Pardo, sole member, the
Debtor estimated $1 million to $10 million in both assets and
liabilities. Courtney Davy, Esq. at the LAW OFFICE OF COURTNEY K.
DAVY, LLP, represents the Debtor as counsel.
MCL NURSING: July 7 Plan Confirmation Hearing Set
-------------------------------------------------
Debtor MCL Nursing, LLC, filed an Amended Disclosure Statement
describing its Plan of Reorganization dated May 12, 2020.
The hearing at which the Court will determine whether to confirm
the Plan will take place on July 7, 2020 at 11:00 a.m. (EST) at the
Richard Russell Federal Building, 75 Ted Turner Drive, Atlanta,
Georgia, 30303, Courtroom 1402. Given the current public health
crisis, hearings may be telephonic only.
A full-text copy of the Amended Disclosure Statement dated May 12,
2020, is available at https://tinyurl.com/yb9f9ber from
PacerMonitor at no charge.
Attorneys for MCL Nursing:
Theodore N. Stapleton
2802 Paces Ferry Road, Suite 100-B
Atlanta, Georgia, 30339
Telephone: (770) 436-3334
E-mail: tstaple@tstaple.com
About MCL Nursing LLC
MCL Nursing, LLC, owns and operates a skilled nursing facility in
McLoud, Oklahoma.
MCL Nursing filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 19-67513) on Nov. 1,
2019. In the petition signed by Christopher F. Brogdon, manager,
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 Barbara Ellis-Monro. Theodore N. Stapleton, Esq., at
Theodore N. Stapleton, P.C., represents the Debtor.
MESA MARKETPLACE: U.S. Trustee Objects to Disclosure Statement
--------------------------------------------------------------
The United States Trustee for the District of Arizona, Region 14,
objects to the proposed Disclosure Statement filed by debtor Mesa
Marketplace Center, LLC, because it fails to include the following
items:
* A complete explanation of the events leading to the bankruptcy
filing. Specifically, the amount of the balloon payment causing
the filing should be disclosed, as well as the amount of the prior
(interest only) monthly payments made by the Debtor to the primary
secured creditor, SMS Financial.
* A more complete description of the Debtor's assets –
specifically, the total square footage and the number of units in
the Debtor’s main asset, the strip mall.
* The Debtor fails to disclose the amounts owed and the proposed
payment amounts outside the plan to three Class 2 lienholders; the
claim amounts owed to Class 5A and 5B claimants IRS and ADOR; and
the total or individual amounts of Class 6 unsecured claims.
* The compensation of any insiders under the plan (i.e., Mr.
Eng’s proposed future compensation).
* Information concerning the creditors' potential risks under
the proposed plan of reorganization.
* The Plan fails to make a provision for the filing of
post-confirmation financial reports on a quarterly basis, with a
copy to the Office of the United States Trustee.
A copy of the United States Trustee's objection to Disclosure
Statement dated May 12, 2020, is available at
https://tinyurl.com/y7b3ndu9 from PacerMonitor.com at no charge.
About Mesa Marketplace Center
Mesa Marketplace Center, LLC is a single asset real estate debtor
(as defined in 11 U.S.C. Section 101(51B)).
It previously sought bankruptcy protection (Bankr. D. Ariz. Case
No. 16-10094) on Aug. 31, 2016.
Mesa Marketplace Center again sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 20-01335) on Feb. 10,
2020. In the petition signed by Kenny Eng, member, the Debtor was
estimated to have $1 million to $10 million in assets and
liabilities.
James Portman Webster, Esq., serves as the Debtor's legal counsel.
MICI CORP: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: MICI Corp, Inc.
1206 Tappan Circle
Carrollton, TX 75006
Business Description: MICI Corp, Inc. is a privately held company
in the nonresidential building construction
industry.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 20-31542
Judge: Hon. Harlin Dewayne Hale
Debtor's Counsel: Areya Holder Aurzada, Esq.
HOLDER LAW
901 Main Street Suite 5320
Dallas, TX 75202
E-mail: areya@holderlawpc.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Brad Schmidt, 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/rXBYr1
MIDTOWN CAMPUS: Unfinished Apartments File for Chapter 11
---------------------------------------------------------
Emily Mavrakis, writing for The Gainesville Sun, reports that
Midtown Campus Properties LLC, which in August 2020, planned to
open the Midtown Apartments, filed for bankruptcy due in part to
the coronavirus pandemic.
Midtown Campus Properties is managed by Oscar Roger. Midtown
Campus' Midtown Apartments is a 310-unit student housing apartment
complex currently under construction in Gainesville Florida, just
across the University of Florida. Rent was to range from $845 to
$1,380 per month per bed, in units that range from studios to four
bedrooms.
In January 2019, the project secured funding from the Florida
Development Finance Corporation about $78 million in bonds.
Midtown Campus Properties said that upon completion, the
approximate value of the property will be about $130 million. The
development of the 500 square feet of mixed-use space began in
2016.
According to Midtown Campus Properties, the ability to lease out
its apartments is uncertain during the pandemic because the
agreements would be contingent on whether UF reopens its campus to
students.
During the spring semester of 2020, many University of Florida
students and their families scrambled to end the leases early or at
least pay reduced rent, the moment they discovered students
wouldn't be returning to on-campus classes for the remainder of the
semester.
The university will hold its summer 2020 classes online and plans
to announce in July 2020 its plan for the fall semester. At a
recent city of Gainesville virtual town hall meeting, UF President
Kent Fuchs said he's confident that with rigorous testing and
screening, students can return for in-person instruction at that
time.
Roger said in an emailed prepared statement, the complex is already
30% pre-leased and that emergency debtor-in-possession financing is
in place to make sure that there are no disruptions to
construction.
Aside from COVID-19 pandemic, disputes with general contractor and
delays caused by 2017 Hurricane Irma are among the reasons that led
to the bankruptcy filing.
According to court documents, the construction of Midtown
Apartments had to cease for 2 and a half weeks during the pandemic
follow prescribed guidelines but crews are now back at work, and
Midtown Apartments plans to open its first group of units in August
2020. All units are expected to be complete by December 2020. At
the time of the filing, the project is 90% complete.
About Midtown Campus
Midtown Campus Properties, LLC, is a Single Asset Real Estate that
owns the Midtown Apartments. The Midtown Apartments is a 310-unit
student housing apartment complex currently under construction at
104 NW 17th St in Gainesville Florida, just across the University
of Florida. It consists of a six-story main building, parking
garage for resident and public use, and commercial retail space.
Each unit includes a full-size kitchen, carpet, tile and hardwood
floors and be fully furnished. It is located near several Midtown
bars and restaurants frequented by students, and just a couple
minutes' walk from Ben Hill Griffin Stadium.
On May 8, 2020, Midtown Campus Properties sought Chapter 11
protection (Bankr. S.D. Fla. Case No. 20-15173). The Debtor was
estimated to have $50 million to $100 million in assets and
liabilities as of the bankruptcy filing. The Hon. Robert A. Mark
is the presiding judge. The Debtor tapped GENOVESE JOBLOVE &
BATTISTA, P.A., as bankruptcy counsel.
MOLINA HEALTHCARE: Moody's Rates New $800MM Unsec. Notes 'B2'
-------------------------------------------------------------
Moody's Investors Service has assigned a B2 rating to the planned
issuance of $800 million in new Molina Healthcare, Inc. senior
unsecured notes with an eight-year tenor. The proceeds will be used
to refinance its current term loan due January 31, 2024, which has
approximately $600 million outstanding, and for general corporate
purposes. The company also upsized its revolving credit facility
(revolver), which is undrawn, to $1 billion from $500 million. The
outlook on Molina and its affiliates is positive.
RATINGS RATIONALE
In April 2019, Molina was upgraded to B2 from B3 and its outlook
was changed to positive. The upgrade and outlook change reflected
the company's significant improvement in results in 2018 following
net losses in 2016 and 2017, as well as accounting problems and
Medicaid contract losses. The improvement led by the current
management team was driven by solid execution, which led to record
earnings, competitive margins, lower leverage and key business wins
in Medicaid. The performance momentum was sustained in 2019, with
the company reporting solid earnings. The coronavirus pandemic did
not materially impact results in Q1 2020 and is unlikely to
adversely impact Q2 results. However, it has caused tremendous
uncertainty and accordingly, the company increased leverage to
bolster liquidity.
Despite the incremental debt, Moody's estimates that
debt-to-capital will nonetheless remain stable, albeit at
approximately 53%, a high level, as it will be offset by strong
earnings during the Q2 2020. Moody's expects debt-to-capital to
decline below 50% by year-end 2020. On a debt-to-EBITDA basis,
Moody's expects leverage to remain below 2.0x, an investment grade
level. Molina is well-positioned for the coronavirus recession and
given its focus in Medicaid and the individual market, the
coronavirus recession is likely to lead to enrollment growth.
Credit challenges for Molina include the aforementioned high
debt-to-capital, the concentration risk in Medicaid, which brings
re-procurement risk, membership declines in recent years and the
need to maintain its improved financial performance as it pivots to
growth.
Currently, Moody's has a four-notch differential between Molina's
B2 senior unsecured debt and the Ba1 insurance financial strength
(IFS) rating of its operating subsidiaries, which is greater than
its standard three-notch differential for insurance groups,
reflecting the increased potential for loss to debt holders
relative to policy holders for issuers with below investment grade
IFS ratings. If Molina continues to perform at a high level,
thereby, demonstrating sustainability of results, Moody's would
likely restore the three-notch differential. Therefore, if the
positive outlook for the IFS ratings are resolved with a one notch
upgrade, the debt rating could go up by two notches.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to rating upgrades, include: (i) a
maintenance of profitability, as measured by the EBITDA margin
(with Moody's adjustments) of at least 3.5%; and (ii) adjusted debt
to capital declines below 50% and adjusted debt to EBITDA remains
below 3.0x; and (iii) earnings coverage of at least 6x.
While a downgrade is unlikely given the positive outlook, factors
that could lead to ratings being affirmed at stable include: (i) a
material decline in profitability, with an EBITDA margin (with
Moody's adjustments) below 3.0%; or (ii) no improvement in adjusted
debt-to-capital from current levels and/or debt/EBITDA increasing
to above 3.5x; or (iii) additional declines in membership or the
unexpected loss of a major Medicaid contract.
The following rating was assigned:
Issuer: Molina Healthcare, Inc.
Senior unsecured notes maturing in 2028 assigned at B2
The outlook on Molina and its affiliates is positive.
Molina Healthcare, Inc. is headquartered in Long Beach, California.
In 2019 total revenue was $16.8 billion with net income of $737
million. Medical membership as of December 31, 2019 was
approximately 3.3 million members. As of December 31, 2019, the
company reported total equity of approximately $2.0 billion.
Moody's insurance financial strength ratings are opinions of the
ability of insurance companies to pay punctually senior
policyholder claims and obligations.
The principal methodology used in this rating was US Health
Insurance Companies Methodology published in November 2019.
MOLINA HEALTHCARE: S&P Affirms 'BB-' ICR, Rates Unsec. Notes 'BB-'
------------------------------------------------------------------
S&P Global Ratings said it affirmed its 'BB-' issuer credit rating
on Molina Healthcare Inc. The outlook is positive. At the same
time, S&P assigned its 'BB-' issue-level rating to the company's
proposed senior unsecured notes.
Molina joins a growing list of U.S. insurers tapping the debt
markets. The company is issuing $800 million senior notes maturing
2028. These notes will rank equal in right of payment with all of
Molina's existing and future senior obligations. They will be
structurally subordinated to the liabilities of their insurance
subsidiaries. S&P expects the company to use most of the proceeds
to repay its outstanding term loan ($600 million outstanding as of
March 31, 2020). It anticipates financial leverage after this
issuance of about 50% for full-year 2020, and decline further to
close to 45% in 2021 and financial obligation-to-EBITDA to remain
below 2x.
S&P said, "Molina has met our expectations for profitability and
business growth. This is why we are affirming our ratings on the
company. As of March 31, 2020, Molina had about 3.4 million members
with operations in 14 states and Puerto Rico. Additionally, in line
with our stable outlook on the overall U.S. health insurance
sector, we expect Molina to manage through the impact of COVID-19
without hurting its credit quality. We also expect the increase in
unemployment and related loss of employer-based insurance to lead
to an increase in Medicaid rolls. In light of Molina's presence in
the managed Medicaid space, we think we may see an increase in
enrollment in 2020.
"We anticipate Molina will have a run-rate return on revenue (ROR)
of 5%-6%, and adjusted EBIT of $1.0 billion-$1.3 billion in 2020.
We expect financial leverage of about 50% in 2020 and closer to 45%
in 2021, with EBITDA fixed-charge coverage above 9x in 2020-2021.
"We could revise the outlook back to stable or lower the rating by
one notch in 2020-2021 if Molina's ROR drops below 2%, financial
leverage stays above 50%, or it is unable to maintain its presence
(keep and win contracts) in the Medicaid space. Key downside risks
include unfavorable changes in Medicaid reimbursement, Medicaid
contract losses (such as Texas), Affordable Care Act (ACA) legal
challenges, and higher-than-expected medical costs.
"We could raise the rating by one notch if Molina sustains an ROR
of at least 5%, has financial leverage of about 45% by year-end
2021, and keeps capital redundancy at least at the 'BBB' level."
MOTIF DIAMOND: July 24 Plan & Disclosure Hearing Set
----------------------------------------------------
On May 7, 2020, Debtor Motif Diamond Designs, Inc., filed with the
U.S. Bankruptcy Court for the Eastern District of Michigan,
Southern Division (Detroit), a Combined Plan of Reorganization and
Disclosure Statement.
On May 12, 2020, Judge Phillip J. Shefferly approved the disclosure
statement and established the following dates and deadlines:
* July 17, 2020, is the deadline to return ballots on the plan,
as well as to file objections to final approval of the adequacy of
the information in the disclosure statement and objections to
confirmation of the plan.
* July 24, 2020 at 11:00 a.m., before the Honorable Phillip J.
Shefferly, United States Bankruptcy Judge, in Courtroom 1975, 211
West Fort Street, Detroit, Michigan 48226 is the hearing on
objections to final approval of the adequacy of the information in
the disclosure statement and confirmation of the plan.
* Aug. 15, 2020, is the deadline for all professionals to file
final fee applications.
A copy of the order dated May 12, 2020, is available at
https://tinyurl.com/ybdgu7ul from PacerMonitor.com at no charge.
About Motif Diamond Designs
Motif Diamond Designs, Inc. is a jewelry store based in Taylor,
Michigan. The Company filed a Chapter 11 petition (Bankr. E.D.
Mich. Case No. 20-40285) on Jan. 8, 2020. The petition was signed
by Toros Chopjian, its vice president. At the time of the filing,
the Debtor was estimated to have assets of up to $50,000 and
liabilities of $1 million to $10 million.
Judge Phillip J. Shefferly oversees the case.
The Debtor hired Yuliy Osipov, Esq. at Osipov Bigelman, P.C., as
its bankruptcy counsel and Al-Hassan, Howell, Sadaps CPA &
Associates, P.C., as its accountants.
NEOVASC INC: Files for CE Mark for Tiara TA Transapical
-------------------------------------------------------
Neovasc, Inc., has filed for CE Mark for its Tiara TA Transapical
mitral valve replacement system.
Mitral Valve disease is one of the most common forms of heart
disease that affects millions of patients worldwide. Traditional
heart valve replacement surgery requires patients to be placed on a
heart-lung bypass machine and results in lengthy recovery time.
The Tiara TA transapical mitral valve replacement system uses a
percutaneous or "key-hole" incision in the chest to completely
replace the native mitral valve and avoids the need for heart-lung
bypass. The less invasive approach may allow for more patients to
be treated and more rapid recovery.
In April, the European Parliament voted overwhelmingly to extend
the Medical Device Directive (MDD) by one year rather than to
transition to a new approval process known and the European Medical
Device Regulation (MDR). Fred Colen, chief executive officer of
Neovasc, said: "Yesterday we received confirmation from our
Notified Body in Europe that the ongoing review of our Tiara
application will continue under the MDD regulation. Now that we
have clarity on the regulatory approach, a well-defined pathway, we
look forward to continued collaboration with the European
authorities."
About Neovasc Inc.
Neovasc -- http://www.neovasc.com/-- is a specialty medical device
company that develops, manufactures and markets products for the
rapidly growing cardiovascular marketplace. Its products include
the Reducer, for the treatment of refractory angina, which is not
currently commercially available in the United States (2 U.S.
patients have been treated under Compassionate Use) and has been
commercially available in Europe since 2015, and Tiara, for the
transcatheter treatment of mitral valve disease, which is currently
under clinical investigation in the United States, Canada, Israel
and Europe.
Neovasc recorded a net loss of $35.13 million for the year ended
Dec. 31, 2019, compared to a net loss of $107.98 million for the
year ended Dec. 31, 2018. As at Dec. 31, 2019, the Company had
$10.10 million in total assets, $24.55 million in total
liabilities, and a total deficit of $14.44 million.
Grant Thornton LLP, in Vancouver, Canada, the Company's auditor
since 2002, issued a "going concern" qualification in its report
dated March 30, 2020 citing that the Company incurred a
comprehensive loss of $33,618,494 during the year ended Dec. 31,
2019, and as of that date, the Company's liabilities exceeded its
assets by $14,445,765. These conditions, along with other matters,
raise substantial doubt about the Company's ability to continue as
a going concern.
NEOVASC INC: Offering Convertible Notes & Warrants for $5 Million
-----------------------------------------------------------------
Neovasc Inc. announced 1) an offering of convertible notes and
warrants to Strul Medical Group for gross proceeds of up to US$5.0
Million; 2) all of the Company's remaining 2017 Notes have been
fully repaid or converted; 3) Neovasc entered into a settlement
agreement with certain holders of the 2017 Notes whereby the
Company will issue warrants to those holders and 4) Neovasc entered
into an agreement to exchange most of the outstanding warrants
issued in January 2020 for common shares of the Company. The
combined transactions improve the fully diluted share capital of
the Company, and are designed to allow the Company to pursue
refinancing options with long term investors who understand the
overall potential of the Company's portfolio of products.
Following the completion of the transactions the Company will have
an issued and outstanding share capital of 12,306,270 common shares
of the Company and a fully diluted share capital of 21,226,518.
"We are pleased to have been able to take strategic action in the
last few days, to fundamentally change our balance sheet and
strengthen our capital structure, including leaving behind the two
2017 note holders, who saved the company in 2017, and who have
achieved a large positive return on their investments, but have
different future objectives. It is time for the company to move
on. The settlement of the remaining 2017 Notes and the exchange of
a large portion of the January 2020 warrants for equity remove
significant overhangs on our fully diluted capital structure. We
continue to work with our investors as we significantly reposition
Neovasc to execute on our core four value creation strategies,"
said Fred Colen, chief executive officer of Neovasc.
"The Strul Medical Group is pleased to announce that we have agreed
to make an additional add-on investment of $5,000,000 in Neovasc,"
said Strul Medical Group principal Aubrey Strul. "Together with our
initial $11,500,000 investment in May of 2019, this brings our
total investment in Neovasc to $16,500,000. The leadership, the
management team, the team of engineers and scientists, the array of
patents and an incredible corporate culture is very impressive. We
are expecting great things from Neovasc and we look forward to the
time when these great products will do great things for the people
of the world who are in need of minimally invasive Mitral Valve
replacements and for optimal treatment of Refractory Angina."
Pursuant to the Offering the Company will issue the 2020 Notes,
convertible at $2.81525 per Common Share for 1,776,041 Common
Shares, and 2,573,959 2020 Warrants exercisable at $2.634 per 2020
Warrant share with a 4 year term. The 2020 Notes will bear
interest at the rate of 8% computed on the basis of a 360-day year
and twelve 30-day months and shall be payable in additional 2020
Notes on the date that is six-months after issuance and on each
six-month period thereafter up to, and including, the maturity
date. The 2020 Notes will have a maturity date of 48-months after
issuance with the holder's option for early redemption at
24-months. The Offering will be completed in two tranches
comprised of an initial closing ("Initial Closing") of US$4 million
aggregate principal amount of 2020 Notes and 2,573,959 2020
Warrants and an additional closing ("Final Closing") of
US$1,000,000 aggregate principal amount of 2020 Notes. Neovasc
intends to use the net proceeds from the Offering for the
development and commercialization of the Neovasc Reducer (the
"Reducer"), development of the Tiara (the "Tiara") and general
corporate and working capital purposes.
Pursuant to the 2017 Note Settlement, the Company made a final
payment of $2,897,000 to holders of the 2017 Notes and $1,016,000
in 2017 Notes was converted for the issuance of 500,014 Common
Shares. The Company and certain holders of the 2017 Notes have
also agreed to a mutual release in return for the issuance by the
Company, in the aggregate, of 500,000 Settlement Warrants to such
holders. Each Settlement Warrant entitles the holder to purchase
one common share in the capital of the Company at an exercise price
of US$2.634 per Settlement Warrant for a period of 4 years
following issuance and are subject to transfer/leak-out
restrictions, including volume and public float restrictions.
Pursuant to the Exchange Agreement, the Company will issue an
aggregate of 672,937 Exchange Shares for the surrender and
cancellation of 2,176,490 warrants outstanding on the basis of
approximately 0.3092 of an Exchange Share for each warrant. After
the exchange there will be 250,000 January 2020 warrants
outstanding. Exchange Shares issued in the Exchange are subject to
transfer/leak-out restrictions, including volume and public float
restrictions.
The Notes, 2020 Warrants, Settlement Warrants and Exchange Shares
will be qualified for distribution in each of the provinces of
British Columbia, Alberta, Saskatchewan, Manitoba and Ontario by
way of a prospectus supplement to the Company's base shelf
prospectus dated July 12, 2018. Prospectus supplements relating to
the Offering and Exchange will be available on the Company's
profile on the SEDAR website at www.sedar.com.
The Company is relying upon the exemption set forth in Section
602.1 of the TSX Company Manual for the issuance of Notes, 2020
Warrants, Settlement Warrants and Exchange Shares, which provides
that the Toronto Stock Exchange will permit certain transactions
involving eligible interlisted issuers on a recognized exchange,
such as the Nasdaq Capital Market.
The Exchange, Settlement and Initial Closing are expected to be
completed the week of May 25, 2020, subject to satisfaction of
customary closing conditions, including approval of the TSX. The
Final Closing is expected to close on or about June 3, 2020.
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of
these securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
About Neovasc Inc.
Neovasc -- http://www.neovasc.com/-- is a specialty medical device
company that develops, manufactures and markets products for the
rapidly growing cardiovascular marketplace. Its products include
the Reducer, for the treatment of refractory angina, which is not
currently commercially available in the United States (2 U.S.
patients have been treated under Compassionate Use) and has been
commercially available in Europe since 2015, and Tiara, for the
transcatheter treatment of mitral valve disease, which is currently
under clinical investigation in the United States, Canada, Israel
and Europe.
Neovasc recorded a net loss of $35.13 million for the year ended
Dec. 31, 2019, compared to a net loss of 107.98 million for the
year ended Dec. 31, 2018. As at Dec. 31, 2019, the Company had
$10.10 million in total assets, $24.55 million in total
liabilities, and a total deficit of $14.44 million.
Grant Thornton LLP, in Vancouver, Canada, the Company's auditor
since 2002, issued a "going concern" qualification in its report
dated March 30, 2020 citing that the Company incurred a
comprehensive loss of $33,618,494 during the year ended Dec. 31,
2019, and as of that date, the Company's liabilities exceeded its
assets by $14,445,765. These conditions, along with other matters,
raise substantial doubt about the Company's ability to continue as
a going concern.
NEOVASC INC: Provides Corporate Update
--------------------------------------
Neovasc, Inc., announced a corporate update on its progress towards
its value creation strategies.
Fred Colen, chief executive officer of Neovasc, commented, "Today's
corporate update is a testament to the teamwork and commitment of
our employees, physician partners and regulators around the globe.
We would like to thank the investors who have given us the
opportunity to advance our programs and we are thrilled to continue
to advance our value creation strategies."
Progress on Reducer
"We are beginning to see a return of elective procedures in Germany
and other European markets. After a marked slowdown that began in
March, Reducer implant rates in Germany, where the company has a
direct sales team and NUB Status 1 designation for reimbursement,
are once again approaching pre-COVID-19 levels. As previously
discussed, the company is aware of the backlog of potential Reducer
patients related to COVID-19 and the reduction in elective
procedures in select European markets and we look forward to
continued acceleration.
"The National Institute for Health and Care Excellence (NICE)
Interventional Procedures Programme in the U.K. has invited Neovasc
to participate in guidance development for Reducer treatment of
refractory angina. Neovasc is honored to be considered for review
by NICE and we look forward to further collaboration as we
establish the value of Reducer therapy in the United Kingdom.
"In the United States, the Reducer FDA Pre-Market Approval (PMA)
milestones continue to progress, with our "100-day Meeting"
recently completed."
Progress on Tiara
"The Company has applied for CE Mark Approval under the Medical
Device Directive (MDD) for the Tiara TA transapical mitral valve
replacement system. The Company is working interactively with our
Notified Body in Europe, to advance our submission.
"We continue to make progress with our transfemoral Tiara TF mitral
valve replacement system program with the completion of several
recent animal implants. We remain focused on a first-in-human
implant towards the end of the year."
Progress on Capital Structure
"Following the retirement of our 2017 notes, the recently announced
financing of approximately $5M will enable the Company to support
ongoing operations under terms more favorable to the Company,
including the removal of the particularly onerous provisions that
have challenged our capital structure since 2017. The Company
believes our revamped capital structure will substantially improve
the Company's ability to raise additional equity capital to fund
the company to its critical milestones in 2020 and early 2021."
About Neovasc Inc.
Neovasc -- http://www.neovasc.com/-- is a specialty medical device
company that develops, manufactures and markets products for the
rapidly growing cardiovascular marketplace. Its products include
the Reducer, for the treatment of refractory angina, which is not
currently commercially available in the United States (2 U.S.
patients have been treated under Compassionate Use) and has been
commercially available in Europe since 2015, and Tiara, for the
transcatheter treatment of mitral valve disease, which is currently
under clinical investigation in the United States, Canada, Israel
and Europe.
Neovasc recorded a net loss of $35.13 million for the year ended
Dec. 31, 2019, compared to a net loss of $107.98 million for the
year ended Dec. 31, 2018. As at Dec. 31, 2019, the Company had
$10.10 million in total assets, $24.55 million in total
liabilities, and a total deficit of $14.44 million.
Grant Thornton LLP, in Vancouver, Canada, the Company's auditor
since 2002, issued a "going concern" qualification in its report
dated March 30, 2020 citing that the Company incurred a
comprehensive loss of $33,618,494 during the year ended Dec. 31,
2019, and as of that date, the Company's liabilities exceeded its
assets by $14,445,765. These conditions, along with other matters,
raise substantial doubt about the Company's ability to continue as
a going concern.
NEW COTAI: Unsecureds to Have 90% Recovery in Debt-for-Equity Plan
------------------------------------------------------------------
New Cotai Holdings, LLC and its affiliates filed with the U.S.
Bankruptcy Court for the Southern District of New York a Joint
Chapter 11 Plan of Reorganization and a Disclosure Statement on May
8, 2020.
The Plan is the result of a settlement reached among the Debtors
and key parties in interest holding approximately 75% of the
Debtors' prepetition debt, and provides for an equitable
distribution of recoveries to the Debtors' creditors and equity
holders. The Debtors, Silver Point, and the holders of Notes that
are parties to the plan support agreement (the PSA or Plan Support
Agreement) believe that any alternative to confirmation of the
Plan, such as liquidation or attempts by another party in interest
to file a plan, could result in significant delays, litigation and
costs, and/or lesser recoveries.
The Plan contemplated by the PSA provides that the Notes will be
cancelled in their entirety and holders of Notes will receive their
pro rata portion of 97.0% of the common units of Reorganized New
Cotai, LLC.
The parties to the PSA have agreed to support the Plan described in
the Disclosure Statement. Specifically, the Consenting Noteholders
and Silver Point have agreed to, among other things: (a) support
and cooperate with the Debtors to take all actions necessary to
consummate the Restructuring; (b) not withdraw, amend, or revoke
their tender, consent, or vote with respect to the Plan; (c) not
object to, delay, impede, or take any other action to interfere
with the Restructuring, or propose, file, support, or vote for any
Alternative Restructuring; (d) not take any other action that is
inconsistent with their obligations under the PSA; and (e)
negotiate in good faith alternative provisions to address legal or
structural impediments that would prevent, hinder or delay the
Restructuring.
Class 4 General Unsecured Claims totaling $250,711 will receive a
distribution in Cash in an amount equal to 90% of their Allowed
General Unsecured Claims; provided, however, that to the extent
that the total allowed amount of general unsecured claims exceeds
$250,000, the distributions to each holder of an Allowed General
Unsecured Claim will be reduced on a pro rata basis such that the
aggregate amount of distributions made to holders of Allowed
General Unsecured Claims does not exceed $225,000 (i.e., 90% of
$250,000).
Holders of Class 6 Existing New Cotai Interests will receive their
pro rata portion of 3.0% of the New Common Units, subject to
dilution by the Upfront Exit Commitment Fee and the Early
Commitment Premium.
Pursuant to the Plan, the Debtors will use proceeds from the Exit
Facility and cash on hand to fund Plan payments and distributions
that are payable in cash.
A full-text copy of the Disclosure Statement dated May 8, 2020, is
available at https://tinyurl.com/yd6ssvbb from PacerMonitor at no
charge.
Counsel for Debtors:
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
Mark A. McDermott
Evan A. Hill
Bram A. Strochlic
One Manhattan West
New York, New York 10001
Tel: (212) 735-3000
Fax: (212) 735-2000
About New Cotai Holdings
New Cotai Holdings, LLC, and certain of its affiliates were formed
for the purpose of investing in what is now Studio City
International Holdings Limited. Studio City International, together
with its subsidiaries, owns the Studio City project, an integrated
resort comprising entertainment, retail, hotel and gaming
facilities located in the Macau Special Administrative Region of
the People's Republic of China. Affiliates of investment funds
managed by Silver Point Capital, L.P. own a direct or indirect
controlling interest in each of the Debtors. The Debtors have no
employees.
New Cotai Holdings and four affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case
No.19-22911) on May 1, 2019. The petitions were signed by David
Reganato, authorized signatory. The cases are assigned to Judge
Robert D. Drain. At the time of filing, New Cotai was estimated to
have $100 million to $500 million in assets and $500 million to $1
billion in liabilities.
The Debtors tapped Skadden, Arps, Slate, Meagher & Flom LLP, as
counsel; Houlihan Lokey Capital, Inc., as financial advisor; and
Prime Clerk LLC, as noticing, claims and balloting agent.
NEXTERA ENERGY: S&P Affirms 'BB' ICR on Recent Acquisitions
-----------------------------------------------------------
S&P Global Ratings affirmed its ratings on NextEra Energy Partners
L.P. (NEP), including the 'BB' long-term issuer credit rating. The
outlook remains stable.
Despite underperformance in 2019, S&P's 2020 expectations are in
line with its earlier forecasts. On an adjusted basis, NEP's 2019
actual performance was lower than S&P's expectations. EBITDA was
about $50 million less than S&P expected because of lower wind
resource in 2019 and lower distributions at NET Holdings (pipeline
with 10% volumetric exposure). This was partially offset by the
Meade acquisition and the debt payoff at Genesis that freed up cash
since NEP repurchased the project-level operating company and
holding company debt.
Despite the 2019 underperformance, S&P expects 2020, 2021, and 2022
leverage to be about 4.4x, on average. It expects 2020
distributions to increase about 30% year over year due to increased
distributions from newly acquired assets (mainly Meade), a
repowering atMountain Prairie, and an increase in cash flows from
existing assets:
-- Genesis--due to buyout of project-level debt, thereby
increasing access to project cash flows.
-- NET pipelines--as the project debt was refinanced using a
convertible equity portfolio financing structure.
-- S&P expects these increases to be partially offset by lower
cash flows from Desert Sunlight due to continued trapped cash from
the PG&E bankruptcy.
S&P views the convertible equity portfolio financing (CEPF) joint
ventures (JVs) as cash flow interruptible in the longer run. NEP
introduced convertible offerings in 2017. NEP has created
partnerships with three funds and has raised about $2.5 billion of
equity capital in the last 18 months (as of May 2020). S&P expects
NEP to continue with these financings going forward.
The funds pay cash to NEP for an interest in a portfolio
NEP receives the majority of distributions (differs across JVs,
85%-99%) for some period of time (three to seven years, across
deals).
NEP can buy out the funds' interests for equity and cash at a fixed
return, or cash distributions flip to the investor.
NEP presents the CEPFs as noncontrolling interests in its
consolidated financial statements. As of today, NEP has issued CEPF
interests in NEP Renewables, NEP Renewables II, NEP Pipelines and
STX Midstream.
S&P said, "Of these, we impute $660 million in debt for the
interest in NEP Renewables and Renewables II, considering 30% of
the interest can be redeemed in cash (principal plus returns
accumulated). For NEP pipelines, we don't impute debt, as 100% of
the interest is to be redeemed in equity. For STX, NEP has a
commitment to fund it through project debt—thus, we don't impute
debt for this CEPF but consider the higher potential for cash flow
interruption because this portfolio will eventually be encumbered
with project debt."
S&P said, "As such, currently we view these financings as positive
to NEP's credit quality for lower debt like treatment compared to
traditional intermediate hybrid financings. In the longer run
however, we will continue to monitor NEP's progress on the buyouts
as any delay would flip cash flows to the counterparties and would
cause a significant deterioration in NEP's credit quality. We also
think these structures expose NEP to market risks if its unit price
is depressed due to conditions unrelated to the company's
performance over an extended period of time. While no conversions
have yet occurred, we expect the first is likely in 2021.
In S&P's view, the Meade acquisition enhances the quality of NEP's
cash flows. In 2019, NEP acquired Meade Pipeline Co. LLC, which
owns a 39.2% stake in the Central Penn Line, a 185-mile pipeline
with capacity to transport 1.7 billion cubic feet (bcf)/day of
natural gas. Transcontinental Gas Pipe Line Co. LLC (Transco) has a
minimum 14-year lease with Meade for its interest in the pipeline.
Such a regulated and contracted pipeline improves NEP's cash flow
quality considering about 85% of its distributions are sourced from
less predictable renewable sources, namely wind and solar. Prior to
this acquisition, the only contracted pipeline (NET) contributed
about 20% to the total distributions of NEP.
S&P said, "We expect Meade to add about $60 million to total
distributions, this translates to 7% of the expected distributions
through 2022. We now expect pipelines to contribute 20%-25% to
total distributions for NEP and lowering cash flow volatility due
to the 14-year lease with Transco, (albeit not enough to affect the
overall cash flow volatility score). As Meade's revenues are
exclusively derived from Transco and Cabot Oil & Gas, Meade
receives a fixed annual payment from Transco and has no volumetric
risk. We view both of these counterparties as strong, with Transco
rated 'BBB/Stable'."
S&P said, "We see the inclusion of gas pipelines in the portfolio
as favorable because these assets are mostly demand pull, common
carriers (little to no commodity risk), and under long-term
contracts. In particular, the gas pipelines diversify risk away
from renewables, and we see them as a superior asset class relative
to contracted conventional power generation, which is usually the
taxable earnings component in peer yield co portfolios."
The company is also relatively tax advantaged. A mix of projects
with earnings and tax credits ensures the company will not pay
significant U.S. federal taxes for the next 15 years. It also has a
glide path such that over the next eight years, distributions can
be treated as a return of capital to the extent of investors' tax
basis. S&P will monitor upcoming acquisitions and their impact on
NEP's quality of distributions score.
S&P said, "From a financial policy perspective, we view targeted
distribution growth of 12%-15% through 2023 as negative. We
consider this a dominant credit driver and unfavorable from a
credit perspective. In 2018, NEP extended its 12%-15% distribution
growth outlook by one year through 2023. Although NEP's growth
prospects appear the strongest of its peers, it is the only yieldco
still pursuing a distribution growth strategy rather than one
linked to a payout ratio. Although it has managed its growth well
so far, we see the emphasis on distribution growth as an aggressive
strategy. We have seen this in master limited partnerships. It puts
the company on a treadmill, and any setbacks in the performance of
the legacy portfolio would need to be mitigated. We believe this
risk could be amplified with the usage of CEPFs."
NEP has historically financed acquisitions with a mix of equity
(CEPF included) and holding-company debt, and it has demonstrated
its ability to access multiple sources of capital to finance
acquisitions. NEP has to continue to demonstrate that its initial
success was not merely from being viewed as a capital-replenishment
vehicle for NEER.
S&P said, "The stable outlook reflects our expectation that NEP's
portfolio will continue to operate under long-term contracts with
mostly investment-grade counterparties and generate predictable
cash flows to support its holding-company debt obligations. We
expect the company to continue to make acquisitions in line with
the existing portfolio and support the current business risk
profile. We also expect adjusted debt to EBITDA of around 4.4x over
the next three years and adjusted funds from operations (FFO) to
debt at or above 15%-16%.
"We would consider lowering the rating if adjusted debt to EBITDA
increases above 5x consistently and if the FFO-to-debt ratio
consistently falls below 14% over our outlook period. This could
result from significantly lower cash flows from the company's
projects as a result of worse operating performance and asset
reliability, higher-than-expected operating costs, unfavorable
weather events, or increased leverage at the corporate level. Given
its 52% reliance on wind-generation-based cash flows, resource risk
could be yet another reason for underperformance that could result
in a downgrade."
Although unlikely at this time, S&P would consider upgrading NEP if
adjusted debt to EBITDA remains below 4x or if adjusted FFO to debt
improves and remains above 22% on a consistent basis. Ratings could
also improve over time as the company's portfolio becomes highly
diversified, resulting in a better business risk profile. Among
other requirements, this would need a lesser reliance on
distributions from NET Holdings, the largest asset in the portfolio
and a degree of certainty around future convertible equity
portfolio financings.
S&P said, "NEP's wind and solar power plants give it a competitive
edge environmentally because they offer reduced emissions. However,
its gas pipelines could experience spills or leaks that affect
biodiversity. Therefore, we view the Meade acquisition as slightly
dilutive to NEP's environmental impact. Considering NEP's
historical focus mainly on wind and solar, we view this gas
pipeline acquisition as contrary to its original strategy. We,
don't, however, view this as a change in management's approach to
low-carbon energy."
This is not the first time NEP has owned a pipeline. In 2014, NEP
announced a public strategy to own clean-energy projects, but by
the end of 2018, it held interest in seven gas pipelines in Texas.
Significant ownership by parent NextEra Energy Inc. (NEE) raises
governance issues, and NEP has taken elaborate steps to distance
itself from NEE. Management believes that because NEP's size and
scale have grown significantly, it's now independent of NEE. NEP GP
ceded control of NEP through certain governance changes in 2017,
which included a cutback to 5% of NEP GP's voting power. The board
can oversee and direct NEP's operations, policies, strategies, and
management without oversight from NEP GP. Moreover, the board
comprises seven directors: three NEP GP-appointed directors and
four independently elected directors. Although S&P sees the
distancing of NEP from NEE as favorable from a governance
perspective, there are still many business interrelationships
between them, including management services, operations and
maintenance, and administrative service agreements. There are also
no NEP employees, unlike peers such as Atlantica Yield, which has
clearly delineated the operations of the yield co from Abengoa.
Although third parties can provide such services, S&P still
believes NEP depends on NEER and NEE.
NORTIS INC: Court Approves $42K Proposed Cure Payment
-----------------------------------------------------
Nortis, Inc., filed the First Amended Disclosure Statement
describing its Second Amended Plan of Reorganization dated May 12,
2020.
Savitt, Bruce and Willey was employed as special litigation counsel
for the Debtor by a Court order dated April 29, 2020. Hanlin Moss
Yi, PS, was employed by Debtor by a Court order dated May 7, 2020,
as a valuation expert.
The Court on Nov. 25, 2019, granted the Debtor an extension of the
date by which it must assume or reject the Lease; and on May 8,
2020, granted the Debtor’s motion to assume the Lease and
approved the proposed cure payment of $42,475.45.
The Debtor has also requested that Savitt, Bruce and Wiley
investigate whether there are any possible claims against Mary
Ellen Harrison and Dennis O'Neil. Both the likelihood of success
and the likelihood of any monetary recovery from the BKT
Malfeasance Claims are speculative. BKT claims it is judgment
proof and that its only assets are the BKT Disputed Interests and
the BKT Disputed Claims.
The value of the Debtor's patent portfolio is based principally on
the opinion of one of the Debtor's board members Susan Preston who
by training is a securities lawyer. Mr. Preston has been both
inside and outside counsel to a number of companies in the biotech
and medical device space and is currently the Managing Partner of
the Seachange Fund, a small local venture capital fund. Ms.
Preston estimates that the patent portfolio valued in isolation, on
a liquidation basis, is likely worth between $200,000 and $500,000.
The Debtor is current on its postpetition obligations.
A full-text copy of the First Amended Disclosure Statement dated
May 12, 2020, is available at https://tinyurl.com/yat9mn8r from
PacerMonitor.com at no charge.
Counsel for the Debtor:
KARR TUTTLE CAMPBELL
701 Fifth Avenue, Suite 3300
Seattle, Washington 98104
Main: (206)2231313
Fax: (206)6827100
About Nortis Inc.
Nortis, Inc., a company that provides scientific research and
development services, filed for relief under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Wash. Case No. 19-13529) on Sept. 25,
2019 in Seattle, Wash. In the petition signed by Thomas Neumann,
president and CEO, the Debtor was estimated to have between $1
million and $10 million in both assets and liabilities. The Hon.
Christopher M. Alston is the presiding judge. Karr Tuttle Campbell
is the Debtor's legal counsel.
ORTHO-CLINICAL DIAGNOSTICS: Moody's Rates New Unsec. Notes 'Caa2'
-----------------------------------------------------------------
Moody's Investors Service assigned a Caa2 rating to Ortho-Clinical
Diagnostics SA's new senior unsecured notes. There is no change to
Ortho's existing ratings, including its B3 Corporate Family Rating,
B3-PD Probability of Default Rating, B2 rating on the senior
secured bank credit facilities, and the Caa2 rating on existing
unsecured notes. The outlook is stable.
Proceeds from the notes offering will be used to refinance the
existing 6.625% USD unsecured notes that mature in 2022 and for
general corporate purposes. Moody's views the refinancing of the
notes as a credit positive. While the transaction will modestly
increase adjusted leverage, it will extend the company's debt
maturity profile while providing additional liquidity. The Caa2
unsecured rating reflects the effective subordination to the
secured credit facility and structural subordination to the
liabilities of non-guarantor foreign subsidiaries.
The rapid and widening spread of the coronavirus outbreak, the
deteriorating global economic outlook, falling oil prices and asset
price declines are creating a severe and extensive credit shock
across many sectors, regions and markets. The combined credit
effects of these developments are unprecedented. The clinical
diagnostic services sector has been one of the sectors adversely
affected by the shock. Moody's regards the coronavirus outbreak as
a social risk under its ESG framework, given the substantial
implications for public health and safety.
More specifically, Ortho will continue to be impacted by a
reduction in demand for its diagnostic products as medical
procedures and healthcare visits have been deferred in response to
the pandemic. That said, Ortho will also benefit from increasing
demand for COVID-19 related testing. Ortho has recently released
two new FDA-approved antibody assays that are used to detect
whether a person has had the disease. Demand for these new tests
could contribute meaningfully to Ortho's revenue, offsetting some
of the headwinds faced by its core diagnostic business
Ratings assigned:
Senior unsecured notes due 2025 at Caa2 (LGD5)
RATINGS RATIONALE
Ortho's B3 Corporate Family Rating reflects Moody's expectation
that the company will continue to operate with high financial
leverage and modest free cash flow relative to debt. Once the
impact of the pandemic has normalized Moody's expects adjusted
debt/EBITDA to return to the low 7.0x range. Moody's also expects
Ortho will generate positive free cash flow over the next 12-18
months reflecting reduced operating costs and a decline in cash
integration and restructuring costs.
Ortho benefits from its large scale and good diversity by customer,
product and geography. The recurring nature of approximately 80% of
the company's revenues that are generated from the sale of
consumables and reagents provides a level of stability to Ortho's
operations. In the longer-term, Ortho is positioned to grow
earnings through achieving further cost efficiencies and increasing
penetration in emerging markets.
The stable outlook reflects Moody's view that Ortho will remain
highly levered over the year ahead while maintaining a good
liquidity profile.
Liquidity is supported by cash balances of $350 million as of March
29, 2020 including a $300 million draw on its $350 million
revolving credit facility. Following a recent amendment, the
financial covenant on its credit facility has been increased to 6.0
times from 5.0 times. Moody's expects that Ortho will have
sufficient headroom on its covenant in 2020.
Medical device companies face moderate environment risk. However,
they regularly encounter elevated elements of social risk,
including responsible production as well as other social and
demographic trends. Risks associated with responsible production
include compliance with regulatory requirements for safety of
medical devices as well as adverse reputational risks arising from
recalls, safety issues or product liability litigation. Medical
device companies will generally benefit from demographic trends,
such as the aging of the populations in developed countries. That
said, increasing utilization may pressure payors, including
individuals, commercial insurers or governments to seek to limit
use and/or reduce prices paid. Moody's believes the near-term risks
to pricing are manageable, but rising pressures may evolve over a
longer period. With respect to governance, the company has an
aggressive financial policy as evidenced by high financial
leverage. This reflects Ortho's private equity ownership that may
lead to shareholder friendly actions which are detrimental to
creditors.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Ortho consistently generates
positive free cash flow and adjusted debt to EBITDA is sustained
below 6.0 times while maintaining a good liquidity profile.
The ratings could be downgraded if Ortho experiences deterioration
in liquidity or is unable to reduce its financial leverage.
Ortho-Clinical Diagnostics produces in-vitro diagnostics equipment
and associated assays and reagents. Ortho's largest segment,
Clinical Laboratories, develops clinical chemistry and immunoassay
tests, targeting primarily small and medium-sized hospitals. The
company's Immunohematology products are used by blood banks and
hospitals to determine patient-donor compatibility in blood
transfusions. Ortho also develops and markets equipment and assays
for blood and plasma screening for infectious diseases. The
company's revenues are approximately $1.8 billion. Ortho is owned
by the Carlyle Group.
The principal methodology used in these ratings was Medical Product
and Device Industry published in June 2017.
ORTHO-CLINICAL DIAGNOSTICS: S&P Rates Senior Unsecured Debt 'CCC'
-----------------------------------------------------------------
S&P Global Ratings assigned its 'CCC' issue-level and '6' recovery
ratings to the proposed senior unsecured notes that will be
co-issued by Ortho-Clinical Diagnostics Bermuda Co. Ltd.'s
(Ortho-Clinical's) subsidiaries Ortho-Clinical Diagnostics S.A. and
Ortho-Clinical Diagnostics Inc. The '6' recovery rating indicates
S&P's expectation for negligible (0%-10%; rounded estimate: 5%)
recovery in the event of a payment default.
Ortho-Clinical will use the proceeds from this issuance to
refinance its remaining senior unsecured notes due 2022 and provide
additional liquidity. S&P's ratings on the company's existing debt
are unchanged.
S&P said, "Our 'B-' issuer credit rating on parent Ortho-Clinical
reflects our expectation that the company's leverage will remain
high, at more than 7.5x. The rating also incorporates our view that
the company operates in a very mature sector with modest growth
prospects and pricing pressure. These factors are partially offset
by Ortho-Clinical's significant scale and market presence in the in
vitro diagnostics market, as well as its revenue visibility from
its significant consumable sales. We expect that the company's
liquidity will be sufficient for near-term needs and that the
business will recover from a temporary slowdown caused by COVID-19.
The stable outlook reflects our expectation that longer-term, the
company will generate minimal, but positive free cash flow and
revenues will grow at a low-single- digit percent rate
organically."
OUTPUT SERVICES: S&P Keeps 'CCC+' ICR on Watch Negative
-------------------------------------------------------
S&P Global Ratings kept all of its ratings on Ridgefield Park,
N.J.-based billing and critical communications provider Output
Services Group Inc. (OSG), including its 'CCC+' issuer credit
rating, on CreditWatch, where S&P placed them with negative
implications on April 2, 2020.
The risk of a covenant breach is increasingly likely at the June
30, 2020, test period, and in early 2021 when the covenant steps
down.
S&P said, "We expect Output Services Group Inc.'s (OSG) weak
operating performance will continue to pressure the company's
narrow margin of compliance under its 7x total net leverage
covenant. At March 31, 2020, the company had a 4% covenant
headroom. Furthermore, the covenant steps down to 6.5x on Jan. 1,
2021, and to 6.0x on Jan. 1, 2022. Under our base-case forecast,
OSG's margin of compliance will decline to the low-single-digit
percent area at the June 30, 2020, test period. Thereafter, we
expect headroom to improve before declining to the low-single-digit
area following the January 2021 step-down."
Nevertheless, high execution risk relating to its business
improvement program and significant economic uncertainty caused by
the COVID-19 pandemic could result in a covenant breach within the
next 12 months. Management calculated adjusted EBITDA of $133.7
million in 2019 declined 5% annually, and fell 9% short of budget
due to organic revenue shortfalls, higher labor and material costs,
and increased investment in product development.
As economic conditions worsen the company could face increasing
challenges integrating its significant acquisitions and
demonstrating cash conversion of EBITDA. These acquisitions include
the 2017 acquisitions of Microdynamics Group and Diamond
Communication Solutions, which together approximately doubled the
revenue scale of the core OSG business; the 10 debt-financed
acquisitions in 2018, which included U.K.-based Communisis Ltd.,
(about 40% of fiscal 2019 total revenue) and again approximately
doubled the company's revenue scale; and the four tuck-in
acquisitions completed using the delayed-draw term loan in late
2019.
While OSG benefits from the increase in scale and capabilities, and
from a stable and recurring revenue profile across its billing
offerings (75% of 2020 budgeted EBITDA), its brand deployment and
marketing services (25%) were in decline prior to the start of the
COVID-19 pandemic and global recession. Communisis' annual revenues
declined 12.1% annually in 2019, and a further 3.3% year on year in
the first quarter of 2020. S&P expects these revenues will be
further impaired by the weakened macroeconomic backdrop, resulting
in total revenue growth of 1% in 2020 as acquisition contributions
offset a 6% decline in organic revenues.
Ongoing cash flow deficits will quickly erode the company's modest
liquidity cushion.
As of March 31, 2020, the company's liquidity consisted of $36.2
million in cash on hand. It has no additional borrowing capacity
under the $20 million revolving credit facility and S&P forecasts
about $5 million to $10 million of cash flow deficits in 2020.
S&P said, "We estimate OSG needs $20 million to operate its
business, in light of its global footprint, seasonal revenue, and
high integration needs. Accordingly, we view the company's
liquidity position provides modest, if any, financial flexibility
to withstand unexpected business shocks." However, the company
benefits from a good debt maturity profile, with the earliest
maturity in March 2023 when its revolving credit facility matures.
S&P believes that OSG's private-equity sponsor, Aquiline Capital
Partners, would provide equity support in the event of a covenant
breach.
S&P's assessment is based on Aquiline's recent demonstration of
commitment to OSG when it provided a $115 million equity investment
to support its debt refinancing in September 2019. Additionally, it
believes an equity covenant breach cure payment will be relatively
modest, if required.
The CreditWatch negative reflects OSG's very thin covenant headroom
and the risk that it could breach its quarterly covenant test in
July 2020. It also reflects high execution risk relating to the
business improvement program against the backdrop of significant
economic uncertainty caused by the COVID-19 pandemic.
S&P could downgrade the ratings on OSG if it forecasts a covenant
violation within the next 12 months with no expectation for an
amendment, waiver, or an equity cure from its financial sponsor, or
if it expects a distressed exchange or restructuring.
OZ INDUSTRIES: Paramount Buying Almont Property for $321K
---------------------------------------------------------
Oz Industries, LLC, asks the U.S. Bankruptcy Court for the Eastern
District of Michigan to authorize the sale of the real property,
consisting of the commercial building and land located at 780 N.
Van Dyke Road in Almont, Michigan to Paramount Building, Inc. for
$321,000, subject to higher and better offers.
The sole asset that remains in the estate is the Debtor's Almont
Property.
Since prior to the filing of the case, as well as through the
course of these proceedings, the Debtor has actively marketed the
Almont Property. The Debtor has advertised the property, contacted
local business groups and reached out to any and all persons that
might have a potential interest in purchasing the property.
On April 29, 2020, the Debtor received the Purchase Agreement for
the purchase of the Almont Property. The Buyer proposes to
purchase the Almont Property for the sum of $321,000. The Purchase
Agreement acknowledges that the offer is subject to higher and
better offers received on or before a public sale date.
As a consequence of the public sale requirement, the offer further
provides, and the Debtor asks authority to (i) impose an initial
overbid requirement of $5,000, so that the next highest offer would
have to be at least $326,000; and (ii) pay a break-up fee in the
sum of $3,000 to Paramount, in the event it is not the successful
bidder upon conclusion of the sale.
Tri-County Bank is owed in excess of the proposed purchase price
for the Almont Property, and it is anticipated that there will be
no net proceeds available for payment to any other creditors having
liens, claims or encumbrances against the Almont Property. The
mortgage held by Tri-County will attach to the proceeds of the
proposed sale. To the extent a higher or better offer is received
prior to the completion of a sale, if the net proceeds of the offer
exceed the balance owed to Tri-County, then the junior interest of
any liens, claims or encumbrances will attach to the net proceeds
of the proposed sale.
On May 19, 2020, persons wishing to submit competing bids on the
Almont Property, for at least $326,000 must provide a cashier's
check or money order deposit in the amount of at least $5,000 to
Mark H. Shapiro, Esq., as counsel for the Debtor, at the address
below, along with a Purchase Agreement. The successful bidder's
deposit will be non-refundable and applied toward the purchase
price.
If a deposit from a qualified bidder is timely received by the
Debtor's counsel on May 19, 2020, then the Debtor will conduct an
auction on May 27, 2020. Based upon the current "Stay at Home"
Executive Orders issued by the Governor of Michigan, in place
through May 28, 2020, it is anticipated that the public sale will
be conducted via a Zoom or other form of videoconference, and may
be recorded or transcribed by a court reporter.
The Debtor will select the bid at the conclusion of the auction
that the Debtor believes to be the highest or best value for the
assets. If, for any reason, the selected bidder fails to
consummate the sale of the assets, the offeror of the second
highest or best bid (subject to the same reservations), will
automatically be deemed to have submitted the highest and best bid,
and the Debtor will be authorized to effect the sale of the assets
to such offeror without further order from the Bankruptcy Court.
From the sale proceeds, the Debtor will pay the costs of sale and
real property taxes at closing.
The Almont Property will be sold as is, without representation or
warranties, whether expressed or implied, including, but not
limited to, any warranties of merchantability, habitability, or
fitness for a particular purpose. The sale will include an
assignment of any and all leases on the property.
The 14-day stay provided for in Bankruptcy Rule 6004(h) will not be
in effect with respect to the sale, and the proposed sale order
will be effective and enforceable immediately upon entry.
A copy of the Purchase Agreement is available at
https://tinyurl.com/ybhfuqch from PacerMonitor.com free of charge.
About Oz Industries
Oz Industries, LLC, is a Single Asset Real Estate debtor (as
defined
in 11 U.S.C. Section 101(51B)). The Company owns a commercial
property located at 780 N. Van Dyke Road in Almont, MI 48003
having
an appraised value of $500,000.
Oz Industries filed for Chapter 11 bankruptcy protection (Bankr.
E.D. Mich. Case No. 19-32761) on Nov. 21, 2019. In the petition
signed by David Mroz, sole member, the Debtor disclosed $514,555 in
total assets and $1,236,643 in total liabilities. The Hon. Joel D.
Applebaum oversees the case. The Debtor is represented by Mark H.
Shapiro, Esq., at Steinberg
Shapiro & Clark.
P8H INC.: Former Paddle8 CEO Sued in Bankruptcy Court
-----------------------------------------------------
Art Newspaper reports that Valentine Uhovski, the former executive
of online auction house Paddle8, was sued by a group of unnamed
creditors, that includes Rema Hort Mann Foundation, Jay-Z's Shawn
Carter Foundation, and celebrities Justin and Haley Bieber,for $1
million accusing him of engaging in "acts of gross mismanagement
and disloyalty."
The lawsuit was filed on May 1, 2020 at the U.S. Bankruptcy Court
for the Southern District of New York, which is handling Paddle8's
bankruptcy case. The plaintiffs claim that Uhovski misappropriate
funds an utilized profits from charity auctions and sales to cover
Paddle8's operating expenses.
Paddle8 has been facing facing several legal actions. In March
2020, artist-run nonprofit organization Film-Makers' Cooperative, a
division and the operational name of the New American Cinema Group,
filed a complaint against Paddle8 for misappropriation of funds
from the November 2019 charity auction, that includes the donated
works of artists like Walter Robinson, Kiki Smith, John Ahearn and
Jim Jarmusch. Among bankruptcy creditors listed in the suit are
Rema Hort Mann Foundation, owed $100,000, and Jay-Z Shawn Carter
Foundation, owed $65,000. A week after the suit was filed, the
auction house filed for Chapter 11 bankruptcy protection, which
protects companies as they reorganize their debt.
"We are deeply concerned by Paddle8's bankruptcy filing,
particularly given that the director of Paddle8's board, Peter
Rich, specifically acknowledged Paddle8's payment obligations to
the nonprofit charity in writing less than a week ago, and assured
us that Paddle8 had made arrangements to settle your client's
monies due immediately. "It now appears that this was nothing but a
bad-faith stalling tactic to buy Paddle8 time to wire money that
should be going to charities to its lawyers," Paul Cossu, an
attorney for the New American Cinema Group, told Artnet News back
in March.
Recently, there are galleries that reported that Paddle8 failed to
remit payments. Ortega y Gasset Projects of Brooklyn is still
waiting for $12,000 from a Paddle8 auction held last December 2019,
Underdonk Gallery said it never received the $15,880 from a benefit
auction in November 2019, and Chicago's artist-run space Prairie is
expecting at least $16,000 from a February 2020 auction. The lost
funds also affect the artists who donated their works and were
slated to receive a percentage of the proceeds.
"I was blindsided by this bizarre suit, as was nearly every
wonderful colleague that I've worked with. During my time as a
leader for CEO my priority was fighting for the brand, employees,
and partners we love. The owner made that commitment impossible,
and I left the company in February after months of deceit and
misinformation. A lot of pain was brought on to the staff, and the
organizations and this is just the latest ruthless blow. I have
every piece of evidence to back up my work and integrity and will
not tolerate these hurtful lies," in an email to Artnews, Uhovski
said.
About Paddle8
Paddle8 was founded in 2011 by Alexander Gilkes, Aditya Julka, and
Osman Khan. It is one of the first online auction house that
specialized in the art world's "middle market." It announced a
high-profile merger with the Berlin-based online auction house
Auctionata in 2016, but the partnership was dissolved in 2017 when
Auctionata filed for insolvency.
P8H, Inc., doing business as Paddle 8, sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No.
20-10809) on March 16, 2020. At the time of the filing, the Debtor
was estimated to have assets of less than $50,000 and liabilities
of between $50,001 and $100,000. Judge Stuart M. Bernstein
oversees the case. The Debtor is represented
by Kirby Aisner & Curley, LLP.
PARKHILL PEDIATRIC: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: ParkHill Pediatric Surgery Center, LLC
d/b/a Legent Pediatric Surgery Center
7150 Greenville Ave.,
Greenville Medical Tower, Suite 400
Dallas, TX 75231
Business Description: ParkHill Pediatric Surgery Center provides
outpatient pediatric services.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 20-31534
Debtor's
Bankruptcy
Counsel: Brandon Tittle, Esq.
FERGUSON BRASWELL FRASER KUBASTA PC
2500 Dallas Parkway, Suite 600
Plano, TX 75093
Tel: 972-826-4445
Email: btittle@fbfk.law
Debtor's
Special
Litigation
Counsel: WILLIAM W. CAMP P.C.
d/b/a CAMP LAW GROUP
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dr. Glen R. Wyant, manager.
The Debtor did not file with the petition a list of its 20 largest
unsecured creditors at the time of the filing.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/Bnlj9f
PG&E CORP: CPUC Approves Chapter 11 Plan of Reorganization
----------------------------------------------------------
The California Public Utilities Commission (CPUC) on May 28, 2020,
approved the Chapter 11 Plan of Reorganization (the Plan) of PG&E
Corporation and Pacific Gas and Electric Company (together, PG&E).
The CPUC approval in its Plan of Reorganization Order Instituting
Investigation proceeding completes another major milestone needed
for PG&E to be eligible to participate in the State's Wildfire
Fund, and keeps the company on track for Bankruptcy Court
confirmation of the Plan prior to June 30, 2020.
The Bankruptcy Court confirmation hearing began on May 27, 2020.
By adopting a final decision on May 28, the CPUC approved a number
of measures to improve PG&E's governance process, operational
structure, and safety performance. Many of the measures outlined
in the CPUC's final decision already are underway. The decision
also approves PG&E's request to issue new debt and securities to
finance its exit from Chapter 11.
"PG&E's most important responsibility remains the safety of our
customers and the communities we serve, and we are committed to
doing right by the communities impacted by wildfires. We have
heard the feedback in [Thurs]day's decision and know we must do
better as a company," said CEO and President of PG&E Corporation
Bill Johnson.
"Since the beginning of the Chapter 11 process, our main goal has
been to get wildfire victims paid fairly and quickly. [Thurs]day's
vote keeps us on track to do so. We have supported recommendations
from the Governor's Office, CPUC President Batjer and the other
Commissioners, and many other stakeholders to hammer out a Plan
that will help PG&E become the utility that our customers and
communities expect and deserve," said Mr. Johnson.
In addition to the CPUC's approval, on May 12, 2020, the Federal
Energy Regulatory Commission issued its approval of the Plan,
including authorizing the creation and funding of PG&E's proposed
Fire Victim Trust. Under PG&E's Plan, the Fire Victim Trust will
be established to administer and pay wildfire victim claims as
provided in the Plan.
The Plan does not raise customer rates and passes on approximately
$1 billion in interest savings to customers. The Plan's financing
provisions position PG&E to attract low-cost capital to fund its
Wildfire Mitigation Plan to invest tens of billions of dollars in
system hardening and wildfire risk mitigation in the coming years.
Wildfire Victim Settlements
As part of the Chapter 11 process, PG&E has previously reached
settlements with all wildfire claimants' groups to be implemented
pursuant to PG&E's Plan, valued at approximately $25.5 billion,
including:
* An approximately $13.5 billion settlement resolving claims by
individual victims and others relating to the 2015 Butte Fire, the
2017 Northern California Wildfires (including the 2017 Tubbs Fire),
and the 2018 Camp Fire; this includes stock valued at $6.75 billion
based on an agreed-upon formula (the ultimate value of the stock
could be higher or lower);
* A $1 billion settlement with certain cities, counties, and
other public entities; and
* An $11 billion settlement with insurance companies and other
entities that paid claims by individuals and businesses related to
the wildfires.
Plan Commitments to Position PG&E for Long-Term Success
Working with the Governor's Office and incorporating guidance from
a February 2020 ruling from CPUC President Batjer, PG&E made a
series of commitments regarding its governance, operations, and
financial structure, all designed to further prioritize safety and
expedite the company's successful emergence from Chapter 11.
The commitments include:
* Supporting the CPUC's enactment of measures to strengthen
PG&E's governance and operations, including enhanced regulatory
oversight and enforcement that provides course-correction tools as
well as stronger enforcement if it becomes necessary;
* Agreeing to host a State-appointed observer to provide the
State with insight into the company's progress on safety goals
before the company exits Chapter 11;
* Selecting a substantial number of new members of the Boards of
Directors of PG&E Corporation and Pacific Gas and Electric Company
upon emergence from Chapter 11;
* Appointing an independent safety monitor when the term of the
court-appointed Federal Monitor expires;
* Establishing newly expanded roles of Chief Risk Officer and
Chief Safety Officer, with both reporting directly to the PG&E
Corporation CEO;
* Forming an Independent Safety Oversight Committee to provide
independent review of operations, including compliance, safety
leadership, and operational performance;
* Assuming all collective bargaining agreements with labor
unions, pension obligations, and other employee obligations, and
all power purchase agreements;
* Reforming executive compensation to further tie it to safety
performance and customer experience;
* A commitment that PG&E Corporation will not reinstate a common
stock dividend until it has recognized $6.2 billion in non-GAAP
core earnings, which PG&E believes will contribute an additional $4
billion of equity to pay down debt and invest in the business;
* Pursuing a rate-neutral $7.5 billion securitization
transaction after PG&E emerges from Chapter 11 in order to finance
costs in an efficient manner that benefits customers and
accelerates payment to wildfire victims; and
* Committing not to seek recovery in customer rates of any
portion of the amounts that will be paid to victims of the 2015,
2017, and 2018 wildfires under the Plan when PG&E emerges from
Chapter 11 (except through the rate-neutral securitization
transaction).
PG&E previously filed an updated Plan with the Bankruptcy Court.
Final Voting Results
Voting on the Plan for entitled parties concluded on May 15, 2020.
On May 22, Prime Clerk, PG&E's court-authorized solicitation and
balloting agent, filed the final voting results with the Bankruptcy
Court. The voting certification reflects that the Plan was
accepted by in excess of 85 percent in both number and amount of
wildfire victims who cast votes on the Plan. PG&E's Plan remains
subject to approval by the Bankruptcy Court.
About PG&E Corporation
PG&E Corporation (NYSE: PCG) -- http://www.pgecorp.com/-- is a
Fortune 200 energy-based holding company, headquartered in San
Francisco. It is the parent company of Pacific Gas and Electric
Company, an energy company that serves 16 million Californians
across a 70,000-square-mile service area in Northern and Central
California.
As of Sept. 30, 2018, the Debtors, on a consolidated basis, had
reported $71.4 billion in assets on a book value basis and $51.7
billion in liabilities on a book value basis.
PG&E Corp. and Pacific Gas employ approximately 24,000 regular
employees, approximately 20 of whom are employed by PG&E Corp. Of
Pacific Gas' regular employees, approximately 15,000 are covered by
collective bargaining agreements with local chapters of three labor
unions: (i) the International Brotherhood of Electrical Workers;
(ii) the Engineers and Scientists of California; and (iii) the
Service Employees International Union.
On Jan. 29, 2019, PG&E Corp. and its primary operating subsidiary,
Pacific Gas and Electric Company, filed voluntary Chapter 11
petitions (Bankr. N.D. Cal. Lead Case No. 19-30088).
PG&E Corporation and its regulated utility subsidiary, Pacific Gas
and Electric Company, said they are facing extraordinary challenges
relating to a series of catastrophic wildfires that occurred in
Northern California in 2017 and 2018. The utility said it faces an
estimated $30 billion in potential liability damages from
California's deadliest wildfires of 2017 and 2018.
Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP are
serving as PG&E's legal counsel, Lazard is serving as its
investment banker and AlixPartners, LLP is serving as the
restructuring advisor to PG&E. Prime Clerk LLC is the claims and
noticing agent.
In order to help support the Company through the reorganization
process, PG&E has appointed James A. Mesterharm, a managing
director at AlixPartners, LLP, and an authorized representative of
AP Services, LLC, to serve as Chief Restructuring Officer. In
addition, PG&E appointed John Boken also a Managing Director at
AlixPartners and an authorized representative of APS, to serve as
Deputy Chief Restructuring Officer. Mr. Mesterharm, Mr. Boken and
their colleagues at AlixPartners will continue to assist PG&E with
the reorganization process and related activities. Morrison &
Foerster LLP, as special regulatory counsel. Munger Tolles & Olson
LLP, as special counsel.
The Office of the U.S. Trustee appointed an official committee of
creditors on Feb. 12, 2019. The Committee retained Milbank LLP as
counsel; FTI Consulting, Inc., as financial advisor; Centerview
Partners LLC as investment banker; and Epiq Corporate
Restructuring, LLC as claims and noticing agent.
On Feb. 15, 2019, the U.S. trustee appointed an official committee
of tort claimants. The tort claimants' committee is represented by
Baker & Hostetler LLP.
PIER 1 IMPORTS: Court Okays Plan to Wind Down Business Operations
-----------------------------------------------------------------
Pier 1 Imports, Inc., on May 29, 2020, disclosed that it has
received approval from the U.S. Bankruptcy Court for the Eastern
District of Virginia for the Company's planned wind-down of
operations. Pier 1 intends to initiate store closing efforts and
liquidation sales once store locations can reopen, in compliance
with COVID-19 guidelines from local government and health
officials. The Company plans to conclude its liquidation sales by
the end of October.
"This is not the outcome we hoped for when we began this process,
and we are deeply saddened to move forward with winding down Pier
1," said Robert Riesbeck, Pier 1's Chief Executive Officer and
Chief Financial Officer. "We are incredibly grateful to everyone
who has supported Pier 1 since the Company's inception nearly 60
years ago, including our committed associates, passionate customers
and talented vendors."
In connection with the wind-down and as previously announced, Pier
1 intends to sell its remaining assets, including its intellectual
property and e-commerce business, pursuant to the bidding
procedures established in February 2020. The Court on May 29 set
July 1, 2020 as the asset bid deadline, July 8, 2020 as the auction
date and July 15, 2020 as the sale hearing date.
Pier 1 is currently continuing to serve customers through
Pier1.com, and orders are being processed and filled.
Additional information regarding the Company's court-supervised
process is available at https://dm.epiq11.com/Pier1, or by calling
the Company's claims agent, Epiq Corporate Restructuring LLC, at
(866) 977-0883 (or +1 (503) 520-4412 for international calls) or
sending an email to pierone@epiqglobal.com.
Kirkland & Ellis LLP and Osler, Hoskin & Harcourt LLP are serving
as legal advisors to Pier 1 in the U.S. and Canada, respectively.
AlixPartners LLP is serving as the Company's restructuring advisor
and Guggenheim Securities, LLC is serving as the Company's
investment banker.
About Pier 1 Imports
Founded with a single store in 1962, Pier 1 Imports, Inc. (OTCPK:
PIRRQ) -- http://www.pier1.com/-- is a leading omni-channel
retailer of unique home decor and accessories. Its products are
available through approximately 930 Pier 1 stores in the U.S. and
online at pier1.com.
Pier 1 Imports and seven affiliates sought Chapter 11 protection
(Bankr. E.D. Va. Lead Case No. 20-30805) on Feb. 17, 2020, to
pursue a sale of the assets.
Pier 1 Imports disclosed $426.6 million in assets and $258.3
million in debt as of Jan. 2, 2020.
Judge Kevin R. Huennekens oversees the cases.
A&G Realty Partners is assisting Pier 1 Imports with its previously
announced store closures and lease modifications. Pier 1 Imports
landlords are encouraged to contact A&G Realty Partners through its
website, http://www.agrep.com/
Kirkland & Ellis LLP and Osler, Hoskin & Harcourt LLP serve as
legal advisors to Pier 1 Imports and its affiliated debtors in the
U.S. and Canada, respectively. The Debtors tapped AlixPartners LLP
as restructuring advisor; Guggenheim Securities, LLC as investment
banker; and Epiq Bankruptcy Solutions as claims agent.
PIER 1 IMPORTS: Unable to Find Buyer, Retailer Winding Down
-----------------------------------------------------------
Frank Heinz of NBC News reports Forth Worth-based home goods
retailer Pier 1 Imports said it is seeking court approval to wind
down operations as it was not able to find a buyer due to the
coronavirus pandemic.
The company said in a press release that it plans to sell its
inventory and remaining assets, including its intellectual property
and online operations.
Pier 1 said it will commence the winding down of its business "as
soon as reasonably possible," once its stores are able to reopen to
liquidate.
"This decision follows months of working to identify a buyer who
would continue to operate our business going forward," Chief
Financial Officer Robert Riesbeck said in a statement.
"Unfortunately, the challenging retail environment has been
significantly compounded by the profound impact of COVID-19,
hindering our ability to secure such a buyer and requiring us to
wind down."
Pier 1, based in Fort Worth, Texas, had filed for bankruptcy
protection in February, prior to the coronavirus crisis slamming
the U.S. economy and forcing thousands of stores to shut. At the
time, the company was planning to shut roughly half of its
locations, or about 450 shops, permanently. Meantime, it was
looking for a buyer for the remaining business.
"We are grateful to our dedicated and hardworking associates,
millions of customers and committed vendors who have collectively
supported Pier 1 for decades," said Mr. Riesbeck. "We deeply value
our associates, customers, business partners and the communities in
which we operate, and this is not the outcome we expected or hoped
to achieve."
According to Riesbeck, the company had worked for months to
identify a buyer to help see them out of bankruptcy, but that "the
challenging retail environment has been significantly compounded by
the profound impact of COVID-19, hindering our ability to secure
such a buyer and requiring us to wind down” as a best way to
maximize the company's remaining assets.
Its stores are able to reopen and it will begin liquidation sales
and final closing efforts. Throughout the COVID-19 pandemic, its
online stores remained open and normally operating. It expected to
continue the process and fill orders until such time that the
inventory is exhausted.
Earlier in 2020, it planned to close down about half of its stores,
including all Canadians stores, while it searches for a buyer to
help emerge from bankruptcy protection.
In January 2020, it initiated a going-out business sales of more
than 400 locations and in the process of closing down two
distribution centers "to reflect the company’s revised
footprint," said Pier 1.
About Pier 1 Imports
Founded with a single store in 1962, Pier 1 Imports, Inc. --
http://www.pier1.com/-- is a leading omni-channel retailer of
unique home decor and accessories. Its products are available
through approximately 930 Pier 1 stores in the U.S. and online at
pier1.com.
Pier 1 Imports and seven affiliates sought Chapter 11 protection
(Bankr. E.D. Va. Lead Case No. 20-30805) on Feb. 17, 2020, to
pursue a sale of the assets.
Pier 1 Imports disclosed $426.6 million in assets and $258.3
million in debt as of Jan. 2, 2020.
Judge Kevin R. Huennekens oversees the cases.
A&G Realty Partners is assisting Pier 1 Imports with its previously
announced store closures and lease modifications. Pier 1 Imports
landlords are encouraged to contact A&G Realty Partners through
itswebsite, http://www.agrep.com/
Kirkland & Ellis LLP and Osler, Hoskin & Harcourt LLP serve as
legal advisors to Pier 1 Imports and its affiliated debtors in the
U.S. and Canada, respectively. The Debtors tapped AlixPartners LLP
as restructuring advisor; Guggenheim Securities, LLC as investment
banker; and Epiq Bankruptcy Solutions as claims agent.
PIXIUS COMMUNICATIONS: Saved by KwikKom & Wisper Out of Bankruptcy
------------------------------------------------------------------
Wichita Eagle reports that high-speed Internet provider Pixius
Communications LLC has been purchased by two companies, KwikKom
Communications and Wisper ISP, out of bankruptcy.
In September 2019, Pixius entered bankruptcy protection to work
through a restructuring of the business.
"To position Pixius for the future, we've made a lot of investments
this 2020; in our people, our tower technology, and our service
levels," CEO Michael Langer wrote at the time in a statement
provided to the WBJ.
Wichita Eagle reports that after a deal failed with the Vegas-based
LTD Broadband, two companies -- KwikKom Communications and Wisper
ISP -- split the purchase. The Iola-based KwiKom acquired the
customers of Pixius in central Kansas, while the Illinois-based
Wisper now has bought the customers in western Missouri customers,
including in Kansas City.
Last May 2019, Pixius sold its IT Services division, with workforce
of 49 people, to Wichita-based Choose Networks Inc., it told
Wichita Business Journal in 2018.
KwiKom Communications is a Kansas-based company founded in 2010,
that provides high-speed wireless and fiber optic services. The
company has a growing network area of about 12,000 square miles
including more than 25 counties in Missouri and Kansas.
Wisper ISP is an Internet service provider that serves both
residential and commercial customers. It offers Internet access to
35 states, serving the most customers in Oklahoma, Missouri, Kansas
and Illinois. It provides fixed wireless Internet services to
around 2.4 million people, making it the 20th largest residential
fixed wireless Internet service provider in the United States.
About Pixius Communications
Pixius Communications LLC -- https://www.pixius.com/ -- is an
internet service provider in Wichita, Kansas. It offers
comprehensive solutions to its customers to meet their internet and
technology needs, where traditional services fail or do not reach.
Pixius Communications sought Chapter 11 protection (Bankr. D. Kan.
Case No. 19-11749) on Sept. 13, 2019. The Debtor was estimated to
have assets between $1 million and $10 million, and liabilities
between $10 million to $50 million. The petition was signed by
Michael Langer, manager. Hon. Robert E. Nugent is the case judge.
Klenda Austerman LLC is the Debtor's counsel.
PROUSYS INC: Has Until Aug. 3, 2020 to File Plan & Disclosures
--------------------------------------------------------------
Judge Martin R. Barash of the U.S. Bankruptcy Court for the Central
District of California, Northern Division, has entered an order
within which the deadline for debtor and debtor-in-possession
ProUsys, Inc. to file a Disclosure Statement and Chapter 11 Plan is
August 3, 2020.
A copy of the order dated May 12, 2020, is available at
https://tinyurl.com/y769uagz from PacerMonitor at no charge.
The Debtor is represented by:
Reed H. Olmstead
LAW OFFICES OF REED H. OLMSTEAD
5266 Hollister Avenue, Suite 224
Santa Barbara, CA 93111
Telephone: (805) 963-9111
Facsimile: (805) 963-2209
E-mail: reed@olmstead.law
About ProUsys Inc.
ProUsys, Inc. -- http://www.prousys.com/-- is a service provider
of automation, electrical instrumentation, control systems,
fabrication, SCADA, wireless and network solutions adding
value-added services in maintenance and construction.
ProUsys, Inc. filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Cal. Case No. 19-10981) on May 31,
2019. In the petition signed by Kevin Mueller, president, the
Debtor disclosed $338,784 in assets and $1,505,242 in liabilities.
Judge Martin Barash oversees the case. The Debtor tapped the Law
Offices of Reed H. Olmstead as its legal counsel, and LeBeau
Thelen, LLP, as its special counsel.
PS HOLDCO: Moody's Confirms B2 CFR, Outlook Negative
----------------------------------------------------
Moody's Investors Service confirmed the ratings of PS HoldCo, LLC,
the flatbed transportation and logistics provider that operates
under the name PS Logistics. The ratings include the B2 corporate
family rating, the B2-PD probability of default rating and the B2
rating of the $315 million term loan due 2025. The ratings outlook
is negative.
This completes the review for downgrade that was initiated on March
30, 2020.
RATINGS RATIONALE
The B2 CFR of PS HoldCo reflects the company's position as one of
the largest providers of flatbed transportation and logistics
services with an operational track record that spans more than a
decade. PS HoldCo's business model comprises asset-based
transportation services using company-owned equipment and
employees, asset-light transportation services using lease
operators and owner-operators, as well as brokerage and logistics
services. Combined with a driver pay structure that is based on a
percentage of applicable freight rates, this model results in a
flexible cost structure and a driver turnover rate that is below
industry averages.
The company is exposed to end-markets that are correlated with
cyclical industrial production and construction spending in North
America. PS HoldCo has to contend therefore with a material
weakening in demand due to a sharp contraction in economic activity
because of measures to contain the coronavirus outbreak. Moody's
regards the pandemic as a social risk under its ESG framework.
EBITA margins may decrease to the low-single digit range, in
Moody's estimates, from already weaker-than-expected levels of
approximately 4% in 2019. At the same time, debt/EBITDA could
increase to elevated levels of around 5.5 times at year-end 2020.
Moody's expects liquidity to remain adequate, with about $50 to $75
million in aggregate in cash and availability under the $75 million
revolving credit facility. Revolver usage could increase if PS
HoldCo opportunistically pursues acquisitions. Furthermore, while
ample as of March 31, 2020, covenant headroom could decrease
materially because earnings will be pressured.
As an operator of heavy-duty trucks with diesel engines, PS HoldCo
is also exposed to the environmental risk that emission regulations
will become more stringent, which could result in higher engine
costs.
The $315 million first lien term loan due 2025 is rated B2, in line
with the B2 CFR. This reflects the very sizeable proportion of the
capital structure that this obligation represents, together with a
meaningful amount of equipment financing notes, relative to the
higher ranking $75 million asset-based revolving credit facility.
The negative outlook considers the earnings pressure, elevated
leverage and lower covenant headroom emanating from the material
weakening in demand for flatbed transportation services as
industrial production and constructing activities contract
following efforts to halt the spread of the coronavirus.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
There will be no upward pressure on the ratings until freight
shipments increase along with a general economic improvement in the
US. The ratings could be upgraded if EBITA margins are at least 6%,
debt/EBITDA is maintained at 4 times or less, and the company
demonstrates consistently positive free cash flow while maintaining
adequate investments in its fleet, such that (retained cash flow
minus capital expenditures)/debt is at least 4%.
The ratings could be downgraded if Moody's expects EBITA margins to
remain below 4.5%, debt/EBITDA to remain above 4.5 times or free
cash flow to be consistently negative. Tightening liquidity, an
accelerated pace of acquisitions or an increase in average fleet
age to well in excess of 30 months could also cause a ratings
downgrade.
The following rating actions were taken:
Confirmations:
Issuer: PS HoldCo, LLC
Corporate Family Rating, Confirmed at B2
Probability of Default Rating, Confirmed at B2-PD
Senior Secured 1st Lien Bank Credit Facility, Confirmed at B2
(LGD4)
Outlook Actions:
Issuer: PS HoldCo, LLC
Outlook, Changed To Negative From Rating Under Review
The principal methodology used in these ratings was Surface
Transportation and Logistics published in May 2019.
PS HoldCo, LLC, headquartered in Birmingham, AL, is a flatbed
transportation and logistics provider that operates a fleet of
about 3,300 trucks and has 42 terminal locations in the eastern,
midwestern and southeastern U.S. The company generated
approximately $900 million of revenues in the last 12 months ended
March 31, 2020. PS HoldCo, LLC is privately owned by funds managed
by One Equity Partners and management.
REITMANS: Files Bankruptcy Due to COVID-19 Induced Setbacks
-----------------------------------------------------------
Ella Chochrek, writing for Footwear News, report that women's
apparel retailer Reitmans Canada Ltd. on May 19, 2020, filed foe
bankruptcy protection, under the Companies' Creditors Arrangement
Act (CCAA).
According to Reitmans, it was forced to file bankruptcy because of
the Covid-19 pandemic, which resulted to the decline of its sales
and the forced temporary closure of its brick-and-mortar units.
Through the CCAA, Reitmans will remain open but it isn't planning
to liquidate.
"Filing for protection under the CCAA is truly the hardest decision
we have had to make as an organization in our almost one hundred
years of history, but this pandemic has left us no choice -- we
believe that this is the only course of action to ensure we remain
successful in the future. We will dedicate ourselves to the
restructuring of our business, and then we'll carry on with what we
do best: offering affordable fashion and great service to our
customers and communities for many years to come," said president
and CEO Stephen Reitman in a release.
During the CCAA process, the corporate website will continue to
take orders and the company will start to reopen its
brick-and-mortar locations in accordance with the guidelines of the
government. It also plans to focus on a digital-first strategy
going forward and will "optimize its retail footprint in Canada."
Reitmans, a retailer of women's, men's, and junior apparel and
accessories, operates more than 800 stores under six banners across
Canada. The company was founded in 1926 by Herman and Sarah
Reitman and is run by CEO Jeremy Reitman. employs around 6,800
people and operates 576 stores under the Reitmans, Thyme Maternity,
Addition Elle, Penningtons, and RW & Co.
RELIABLE EXPRESS: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Reliable Express Transportation, LLC
2100 N. Hwy. 360, Suite 908B
Grand Prairie, TX 75050
Business Description: Reliable Express Transportation is a
privately held company in the general
freight trucking industry.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 20-41910
Judge: Hon. Edward L. Morris
Debtor's Counsel: Melissa S. Hayward, Esq.
HAYWARD & ASSOCIATES PLLC
10501 N. Central Expressway
Suite 106
Dallas, TX 75231
Tel: 972-755-7100
E-mail: mhayward@haywardfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Serges Ndarishikanye, managing member.
The Debtor did not include in the petition a list of its 20 largest
unsecured creditors at the time of the filing.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/ylZmMl
RELIABLE PROFESSIONAL: Case Summary & 10 Unsecured Creditors
------------------------------------------------------------
Debtor: Reliable Professional Services, LLC
1400 Cherry Hill Road
Brooklyn, MD 21225
Business Description: Reliable Professional Services is a
provider of school and employee bus
transportation services.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
District of Maryland
Case No.: 20-15611
Debtor's Counsel: Daniel A. Staeven, Esq.
FROST & ASSOCIATES, LLC
839 Bestgate Road, Suite 400
Annapolis, MD 21401
Tel: 410-497-4957
E-mail: daniel.staeven@frosttaxlaw.com
Total Assets: $4,296,138
Total Liabilities: $6,588,888
The petition was signed by Angel Sutton-Richardson, president.
A copy of the petition containing, among other items, a list of the
Debtor's 10 unsecured creditors is available for free at
PacerMonitor.com at:
https://is.gd/mrBMLC
ROVIG MINERALS: $5.25M Sale of Assets to GHI Approved
-----------------------------------------------------
Judge John W. Kolwe of the U.S. Bankruptcy Court for the Western
District of Louisiana authorized Dwayne M. Murray, the Chapter 11
Trustee of Rovig Minerals, Inc., to sell assets to Golden Hawk
Investors, LLC for the sum of (a) $4.5 million cash due at closing,
with an effective date of June 1, 2020; (b) together with execution
of a promissory note in the amount of $750,000 payable over five
years for certain estate plugging and abandoning liability for
non-purchased assets; and (c) a contingent commitment to pay
additional bonuses to the estate tied to certain annual benchmark
pricing, all as more fully set forth in the Term Sheet filed as
Exhibit A to the Modification Notice and the Purchase and Sale
Agreement.
All Findings of Findings of Fact and Conclusions of Law are
incorporated into the Order. To the extent there is an
inconsistency between the Order and the Findings and Conclusions,
the Findings and Conclusions will control.
The sale is free and clear of all Liens, Claims, Preference Rights,
Transfer Requirements, unperfected Over-riding Royalty Interests
and Royalty Interests and other interests in and on the Assets.
Following the Closing Date, no holder of a Barred Claim in or
against the Estate or the Assets will interfere with the Buyer's
rights and title to, and operation of, or use and enjoyment of, the
Assets based on or related to any such Barred Claim except with
respect to Plugging and Abandonment Obligations assumed by the
Buyer.
The sale is free and clear of all Barred Claims, with any and all
such liens, claims, encumbrances
Given the lack of objections and the need to close without further
delay, the 14-day stay of the Order pursuant to Bankruptcy Rule
9023 is waived.
A copy of the Agreement is available at
https://tinyurl.com/y9y4w666 from PacerMonitor.com free of charge.
About Rovig Minerals
Rovig Minerals, Inc. -- http://www.rovigminerals.com/-- was
founded in 1980 in Billings, Mont., to pursue exploration and
development of mineral, oil and gas projects around the world.
On Sept. 25, 2019, creditors FDF Energy Services LLC, Tri-City
Services Inc., Oil Country Tubular Corp., DH Rock Bit Inc., Aldonsa
Inc. filed an involuntary Chapter 11 petition against the Debtor
(Bankr. W.D. La. Case No. 19-51133). The creditors are represented
by Michael A. Crawford, Esq., at Taylor, Porter, Brooks &
Phillips.
On Oct. 18, 2019, the Debtor and the Petitioning Creditors signed a
joint stipulation to convert the involuntary to a voluntary chapter
11 and for entry of a consent order for relief pursuant to 11
U.S.C. Sec. 303(h)(1).
The case is assigned to Judge John W. Kolwe.
The Debtor tapped H. Kent Aguillard, Esq., and Caleb Aguillard,
Esq., as its bankruptcy attorneys.
RYFIELD PROPERTIES: Allowed to Use Cash Collateral on Interim Basis
-------------------------------------------------------------------
Judge Christopher Alston of the U.S. Bankruptcy Court for the
Western District of Washington authorized Ryfield Properties, Inc.
to use cash collateral on an interim basis pursuant to the budget.
A final hearing on the use of cash collateral is set for June 4,
2020 at 1:30 p.m.
Each of the Secured Creditors is granted replacement liens in the
Debtor's post-petition cash, accounts receivable and inventory, and
the proceeds of each of the foregoing, to the same extent and
priority as any duly perfected and unavoidable liens in cash
collateral held by the respective Secured Creditors as of the
Petition Date, limited to the amount of any cash collateral of the
respective Secured Creditors as of the Petition Date, to the extent
that any cash collateral of the respective Secured Creditors is
actually used by the Debtor. Said replacement lien does not
include, without limitation, a lien on avoidance action proceeds.
The Debtor is directed to maintain insurance on its assets as the
same existed as of the Petition Date and provide evidence of the
same to Secured Creditors upon request.
About Ryfield Properties Inc
Ryfield Properties, Inc. is a privately held company in the
quarrying business. The company sought protection under Chapter 11
of the Bankruptcy Code (Bankr. W.D. Wash. Case No. 20-11360) on May
7, 2020. The petition was signed by Katy Rygaard, principal. The
Debtor is represented by Faye C. Rasch, Esq. at LAW OFFICE OF FAYE
C. RASCH. At the time of filing, the Debtor was estimated to have
$1 million to $10 million in assets and liabilities.
SABON HOLDINGS: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------
Lead Debtor: Sabon Holdings LLC
584 Broadway, Suite 601
New York, NY 10012
Business Description: The Debtors distribute personal care
products. They offer, among other items,
bath balls, foams, mineral powders, body
scrubs, shower gels, milky soaps,
deodorants, perfumes, massage oil, body
lotions, hand soaps, scrubs and exfoliants,
moisturizers, hand sanitizers, lip care, and
eye care products.
Chapter 11
Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Southern District of New York
Fourteen affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Sabon Holdings LLC 20-11320
584 Broadway, Suite 601
New York, NY 10012
Sabon 1276 Lex, LLC 20-11329
1276 Lexington Ave
New York, NY 10028
Sabon 1371 6th Ave, LLC 20-11325
Sabon 1450 Byw, LLC 20-11333
1450 Broadway
New York, NY 10018
Sabon 2052 Bwy, LLC 20-11327
2052 Broadway
New York, NY 10023
Sabon 458 Bwy, LLC 20-11331
458 Broadway
New York, NY 10013
Sabon 78 7th Ave, LLC 20-11330
78 7th Ave
New York, NY 10011
Sabon 782 Lex, LLC 20-11322
782 Lexington Ave
New York, NY 10065
Sabon American Dream, LLC 20-11326
584 Broadway Ste 601
New York, NY 10012
Sabon Management, LLC 20-11332
584 Broadway Avenue, Suite 601
New York, NY 10012
Sabon RF, LLC 20-11324
Roosevelt Field Mall
630 Old Country Rd
Garden City, NY 11530
Sabon Web, LLC 20-11321
584 Broadway Room 601
New York, NY 10012
Sabon Williamsburg, LLC 20-11328
128 N. 4th Street
Brooklyn, NY 11249
Soapia, Inc. 20-11323
1371 6th Ave
New York, NY 10019
Debtors' Counsel: John G. McCarthy, Esq.
SMITH, GAMBRELL & RUSSELL, LLP
1301 Avenue of the Americas
21st Floor
New York, NY 10019
Tel: 212-907-9703
E-mail: jmccarthy@sgrlaw.com
Debtors'
Restructuring
Advisor: DEVELOPMENT SPECIALISTS, INC.
Debtors' Assets and Liabilities:
Total Total
Assets Liabilities
----------- -----------
Sabon Holdings LLC $140,094 $10,283,527
Sabon 1276 Lex, LLC $163,740 $372,233
Sabon 1371 6th Ave, LLC $- $-
Sabon 1450 Byw, LLC $195,396 $491,679
Sabon 2052 Bwy, LLC $111,917 $337,010
Sabon 458 Bwy, LLC $239,284 $929,172
Sabon 78 7th Ave, LLC $50,335 $222,524
Sabon 782 Lex, LLC $76,842 $380,211
Sabon American Dream, LLC $16,320 $0
Sabon Management, LLC $4,020,646 $389,899
Sabon RF, LLC $39,513 $224,197
Sabon Web, LLC $48,826 $183,746
Sabon Williamsburg, LLC $64,253 $182,753
Soapia, Inc. $200 $0
The petitions were signed by Yale Scott Bogen, chief restructuring
officer.
Sabon Holdings stated it has no unsecured creditors. A full-text
copy of the Debtor's petition is available for free at
PacerMonitor.com at:
https://is.gd/2SKm2D
A full-text copy of Sabon 1276 Lex's petition containing, among
other items, a list of the Debtor's three unsecured creditors is
available for free at:
https://is.gd/k4nMti
A copy of Sabon 1450 Byw's petition containing, among other items,
a list of the Debtor's four unsecured creditors is available for
free at PacerMonitor.com at:
https://is.gd/OsCkcA
A copy of Sabon 2052's petition containing, among other items, a
list of the Debtor's three unsecured creditors is available for
free at PacerMonitor.com at:
https://is.gd/gocQNg
A copy of Sabon 458's petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://is.gd/eN4FR1
A copy of Sabon 78 7th Ave's petition containing, among other
items, a list of the Debtor's three unsecured creditors is
available for free at PacerMonitor.com at:
https://is.gd/AQuJ3M
A copy of Sabon 782 Lex's petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://is.gd/laSeMN
Sabon American stated it has no unsecured creditors. A full-text
copy of the petition is available for free at PacerMonitor.com at:
https://is.gd/Pe4EeW
A copy of Sabon Management's petition containing, among other
items, a list of the Debtor's 11 unsecured creditors is available
for free at PacerMonitor.com at:
https://is.gd/sm2HRu
A copy of Sabon RF, LLC's petition containing, among other items, a
list of the Debtor's five unsecured creditors is available for free
at PacerMonitor.com at:
https://is.gd/ZjlVHN
A copy of Sabon Web's petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://is.gd/Ng3VY4
A copy of Sabon Williamsburg's petition containing, among other
items, a list of the Debtor's twolargest unsecured creditors is
available for free at PacerMonitor.com at:
https://is.gd/pDt7Uu
Soapia, Inc. stated it has no unsecured creditors. A full-text
copy of the petition is available for free at PacerMonitor.com at:
https://is.gd/SgSr5d
SD-CHARLOTTE LLC: RTHT Sets Bidding Procedures for All MOD Assets
-----------------------------------------------------------------
SD-Charlotte, LLC and SD-Missouri, LLC, ask the U.S. Bankruptcy
Court for the Western District of North Carolina to authorize the
bidding procedures in connection with RTHT Investments, LLC's
auction sale of substantially all assets related to its MOD Pizza
restaurants.
The Selling Debtor has developed and opened 14 MOD Pizza
restaurants in North Carolina. RTHT opened seven MOD Pizza
restaurants in 2015 to 2017, three MOD Pizza restaurants in 2018,
three MOD Pizza restaurants in 2019, and one MOD Pizza restaurant
in January 2020. Its Pizza restaurants are subject to certain
development and franchise license agreements with MOD Super Fast
Pizza Franchising, LLC.
The primary value of the MOD Assets is in their continued
operations. The Debtors believe that the best available means of
maximizing the value of the MOD Assets is to conduct the sale
process and attempt to increase recoveries through a competitive
auction process for the MOD Assets on the proposed timeline. In
furtherance thereof, they have engaged Peak Franchise Capital, an
investment banker with extensive experience in selling franchisee
assets in a restructuring, to assist with soliciting bidders and
potential parties in interest to create a competitive auction
process contemplated by the Bidding Procedures.
The Prepetition Secured Lender, which holds the senior liens
encumbering the MOD Assets, and the Committee both support the
Debtors' pursuit of the sale of the MOD Assets pursuant to the
procedures set forth herein and the related relief requested in the
Motion.
The Debtors propose that the hearing to approve the Bidding
Procedures be held on May 27, 2020 at 9:30 a.m. (EDT), with
objections to the Bidding Procedures, if any, to be filed on May
18, 2020 at 4:00 p.m. (EDT).
The salient terms of the Bidding Procedures are:
a. Bid Deadline: July 7, 2020 at 4:00 p.m. (EDT)
b. Initial Bid: If the Selling Debtor enters into a Stalking
Horse Agreement, it has a value to the Debtors that is greater than
the sum of the Stalking Horse Agreement, plus the Stalking Horse
Protections, plus $75,000.
c. Deposit: 20% of the Purchase Price
d. Auction: If the Selling Debtor receives more than one
Qualified Bid (inclusive of a Stalking Horse Agreement), the
Selling Debtor will conduct an Auction of the MOD Assets, which
will take place at 10:00 a.m. (EDT) on July 10, 2020, at the
offices of Moore & Van Allen PLLC, 100 North Tryon Street, Suite
4700, Charlotte, North Carolina 28202, or such other date, time and
location as will be timely communicated to all entities entitled to
attend the Auction.
e. Bid Increments: $50,000
f. Sale Hearing: July 15, 2020 at 9:30 a.m. (EDT)
g. Sale Objection Deadline: July 8, 2020 at 4:00 p.m. (EDT)
In connection with any Sale Transaction, the Debtors ask authority
to assume and assign to a Successful Bidder one or more Contracts.
Not later than three business days after the Court's entry of the
Bidding Procedures Order, the Debtors will file with the Court and
serve on each Counterparty to a Contract that may be assumed in
connection with any Sale Transaction and Notice of Assumption and
Assignment, which will (i) identify the applicable Contracts; (ii)
list the Debtors' good-faith calculation of Cure Amounts with
respect to each Contract; (iii) expressly state that assumption or
assignment of a Contract is not guaranteed and is subject to Court
approval and (iv) prominently display the deadlines to file Cure
Objections and Adequate Assurance Objections. The Cure Objection
Deadline is 14 days after service of the Notice of Assumption and
Assignment. The Adequate Assurance Objection Deadline is July 8,
2020, at 4:00 p.m. (EDT).
Except for the permitted liens and encumbrances discussed in an
Asset Purchase Agreement, the Debtors ask that the MOD Assets be
transferred to the Successful Bidder(s) or Back-up Bidder(s), as
the case may be, free and clear of all liens, claims and
encumbrances, with such liens, claims and encumbrances to attach to
the proceeds of the sale of the MOD Assets.
The Debtors ask entry of the following:
a. the Bidding Procedures Order granting the following relief:
i. approving the procedures to be used in connection with
one or more sales of the MOD Assets;
ii. approving the form of Notice of Auction and Sale
Hearing of the deadline to bid on the MOD Assets;
iii. authorizing the Selling Debtor to enter into a
Stalking Horse Agreement with a Stalking Horse Bidder until June 8,
2020, and to provide certain Stalking Horse Protections, including
a Break-Up Fee, to the Stalking Horse Bidder in connection
therewith;
iv. scheduling (A) the Auction at 10:00 a.m. (EDT) on
July 10, 2020 and (B) the Sale Hearing at 9:30 a.m. (EDT) on July
15, 2020;
v. approving procedures for the assumption and assignment
of executory contracts and unexpired leases in connection with any
Sale Transaction;
vi. approving the form and manner of notice to each
relevant non-debtor counterparty to a Contract (A) the Debtors'
calculation of the Cure Amounts and (B) certain other information
regarding the potential assumption and assignment of Contracts in
connection with a Sale Transaction and granting related relief; and
b. one or more Sale Orders, the form of which to be provided
as a supplement to the Motion prior to the Sale Hearing, granting
the following relief:
i. authorizing one or more Sale Transactions for the sale
of the MOD Assets free and clear of all liens, claims, interests
and determined by the Debtors and any Successful Bidder, with liens
to attach to the proceeds of the applicable Sale Transaction;
ii. authorizing the assumption and assignment of certain
Contracts in connection with an applicable Sale Transaction; and
iii. granting related relief.
The Debtors propose the following procedure pursuant to which the
Selling Debtor would have the authority to enter into a Stalking
Horse Agreement and provide a Stalking Horse Bidder with the
Stalking Horse Protections set forth:
a. The Selling Debtor will continue to solicit offers from
potential bidders to serve as the Stalking Horse Bidder for the MOD
Assets. The Selling Debtors will have until June 8, 2020, to nter
into a Stalking Horse Agreement for a Sale of the MOD Assets and
file the same with the Court.
b. Upon the filing of the Stalking Horse Agreement with the
Court on the Stalking Horse Deadline, the Stalking Horse Bidder
will be entitled to the Stalking Horse Protections (as set forth
below) and other provisions of the Bidding Procedures applicable to
a Stalking Horse Bidder and/or Stalking Horse Agreement.
c. The Debtors would be authorized to provide the Stalking
Horse Bidder with the following Stalking Horse Protections: (i) an
aggregate Break-Up Fee not to exceed 3% of the Stalking Horse
Bidder’s cash bid amount, and (ii) an amount in cash equal to the
aggregate amount of the reasonable charges, costs, fees, payments,
and expenses (including, without limitation, all reasonable fees,
expenses and disbursements of any representatives of the Stalking
Horse Bidder) paid or incurred by or on behalf of Stalking Horse
Bidder relating to or in connection with its bid, to the extent not
otherwise paid, which such amount will be estimated and
communicated to the Qualified Bidders on or prior to the Auction.
d. The Selling Debtor's obligation to pay the Stalking Horse
Protections pursuant to a Stalking Horse Agreement will survive
termination of the Stalking Horse Agreement, and, to the extent
owed by the Selling Debtor, constitute an administrative expense
claim under sections 503(b) and 507 of the Bankruptcy Code against
the Selling Debtor.
A Sale to a Stalking Horse Bidder will be subject to higher or
otherwise better offers pursuant to the Bidding Procedures. Based
on their business judgment, the Debtors believe that the proposed
structure of the Bidding Procedures will facilitate a full and fair
process that will maximize the realized value of the MOD Assets for
the benefit of the Debtors and their estates and creditors, while
also compensating a Stalking Horse Bidder for its efforts, as any
Stalking Horse Bidder will devote considerable time, money and
effort in pursuit of the Sale throughout the sale process for the
MOD Assets.
The Debtors ask approval from the Court of the procedures for
selecting a Stalking Horse Bidder as well as the Stalking Horse
Protections and the allowance thereof as an administrative claim
under Section 507(b) and 503(b) of the Bankruptcy Code against the
Selling Debtor's bankruptcy estate.
Finally, the Debtors ask that the Court waives the stay imposed by
Bankruptcy Rule 6004(h). They believe a waiver of the 14-day stay
imposed by Bankruptcy Rules 6004(h) and 6006(d), to the extent that
they apply, is in the best interest of their estates and their
stakeholders.
A copy of the Bidding Procedures is available at
https://tinyurl.com/ycbhqocq from PacerMonitor.com free of charge.
SD-Charlotte, LLC, sought Chapter 11 protection (Bankr. W.D. N.C.
Case No. 3:20-bk-30149) on Feb. 7, 2020. The case is assigned to
Judge Laura T Beyer.
SECUR O&G: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Secur O&G LLC
160 Industrial Park Rd
Friendly, WV 26146
Business Description: Secur O&G LLC offers liquid and solid waste
processing and disposal services for the oil
and gas industry.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Southern District of West Virginia
Case No.: 20-60053
Judge: Hon. Frank W. Volk
Debtor's Counsel: Andrew S. Nason, Esq.
William W. Pepper, Esq.
Daniel Lattanzi, Esq.
Emmett Pepper, Esq.
PEPPER AND NASON
8 Hale St.
Charleston, WV 25301
Tel: 304-346-0361
E-mail: tinas@peppernason.com
Total Assets: $458,421
Total Liabilities: $5,568,876
The petition was signed by Tim Wegener, 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/IyLV64
SFKR LLC: Austin Bank Objects to Disclosure Statement
-----------------------------------------------------
Austin Bank, Texas N.A., a secured creditor and party-in-interest,
objects to the Disclosure Statement filed by debtor SFKR, LLC:
Austin Bank argues that the Disclosure Statement does not meet the
statutory requirement of providing adequate information because,
among other things, with respect to the secured claim of Austin
Bank:
* Fails to disclose the amount of the Austin Bank claim which
will be finally allowed regardless of other Plan provisions;
* Fails to acknowledge that the Austin Bank liens and security
interests are valid and perfected and remain in force regardless of
other Plan provisions; and
* As to Austin Bank, the Plan fails to specify what
maintenance, enforcement and collection rights and responsibilities
set forth in the loan documents, if any, are preserved
post-confirmation.
A copy of Austin Bank's objection to the Disclosure Statement dated
May 12, 2020, is available at https://tinyurl.com/y9qa9qqm from
PacerMonitor at no charge.
Austin Bank is represented by:
McNALLY & PATRICK, L.L.P.
Michael J. McNally
100 E. Ferguson, Suite 400
Tyler, Texas 75702
Tel: 903-597-6301
Fax: 903-597-6302
E-mail: MichaelJMcNally@suddenlinkmail.com
About SFKR LLC
SFKR, LLC, is a privately held company based in Tyler, Texas. Its
business consists of the ownership of a number of pieces of
commercial property.
SFKR, LLC, sought Chapter 11 protection (Bankr. E.D. Tex. Case
No.19-60674) on Oct. 1, 2019. In the petition signed by Shahzad
Asghar, managing member, the Debtor was estimated to have assets in
the range of $0 to $50,000 and $1 million to $10 million in debt.
The case is assigned to Judge Bill Parker.
The Debtor tapped Eric A. Liepins, Esq., at Eric A. Liepins, as
counsel.
SFKR LLC: MidSouth VI Objects to Disclosure Statement
-----------------------------------------------------
MidSouth VI REO, LLC, a secured creditor and party-in-interest,
objects to the Disclosure Statement filed by debtor SFKR, LLC.
MidSouth objects to the Disclosure to the extent that the
Disclosure misidentifies MidSouth. The Disclosure references
MidSouth as "Mid South Bank N.A." MidSouth Bank, N.A. is the
predecessor in interest to MidSouth VI REO LLC. MidSouth's proof
of claim was filed on behalf of MidSouth VI REO LLC, who is the
current owner and golder of the Note and Deed of Trust referenced
in MidSouth's proof of claim on file.
MidSouth also asserts that:
* The Disclosure Statement does not adequately describe the
available assets or their value. Properties owned by the Debtor
are listed by address with no further description. No information
is provided regarding the size, improvements and current use of
each property. The Disclosure Statement fails to include all
properties owned by the Debtor.
* The Disclosure Statement also fails to describe the cash
balances which are reflected on monthly operating reports. The
Debtor states that the property at 801 ESE Loop 323, Tyler, Texas,
is generating monthly rental income in the amount of $2,900.00 per
month. The Disclosure does not make mention of how much rental
income from the MidSouth Collateral has accumulated in the debtor
in Possession Account.
* The Disclosure Statement fails to adequately describe the
scheduled claims. The amounts of the secured claims do not reflect
interest accrued since the case was filed. Interest continues to
accrue after the Petition Date at the rate set forth in the Note
and because MidSouth’s claim is oversecured it is also allowed to
recover its reasonable and necessary attorney's fees under §506(b)
of the Code.
* The Disclosure fails to adequately describe the estimated
administrative expenses including attorney's fees and accountants'
fees. The Motion to Approve Sale filed by Debtor calls for the
payment of fees to John Barry as a part of the closing costs to be
paid from property of the estate.
* The Disclosure lacks basic information regarding the various
pending sale motions, including sales prices, payment terms, liens
on the sales proceeds and other potential restrictions on the
proposed use of the funds. Debtor claims the proposed plan will be
funded in part from notes payable to the Debtor after closing of
the various sales of real property.
A copy of MidSouth's objection to the Disclosure Statement dated
May 12, 2020, is available at https://tinyurl.com/yces2uax from
PacerMonitor at no charge.
MidSouth VI is represented by:
RITCHESON, LAUFFER & VINCENT, P.C.
821 ESE Loop 323, Suite 530
Tyler, Texas 75701
Tel: (903) 535-2900
Fax: (903) 533-8646
Douglas A. Ritcheson
Scott A. Ritcheson
About SFKR LLC
SFKR, LLC, is a privately held company based in Tyler, Texas. Its
business consists of the ownership of a number of pieces of
commercial property.
SFKR, LLC, sought Chapter 11 protection (Bankr. E.D. Tex. Case No.
19-60674) on Oct. 1, 2019. In the petition signed by Shahzad
Asghar, managing member, the Debtor was estimated to have assets in
the range of $0 to $50,000 and $1 million to $10 million in debt.
The case is assigned to Judge Bill Parker.
The Debtor tapped Eric A. Liepins, Esq., at Eric A. Liepins, as
counsel.
SOGIO INVESTMENTS: Case Summary & 8 Unsecured Creditors
-------------------------------------------------------
Debtor: Sogio Investments, LLC
5751 Kroger Drive, Suite 293
Fort Worth, TX 76244
Business Description: Sogio Investments, LLC --
https://www.thesogiobuilding.com -- owns and
operates The SoGio Building, a 70,000 sq.ft.
state of the art office building located in
Keller, Texas.
Chapter 11 Petition Date: May 29, 2020
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 20-41918
Judge: Hon. Edward L. Morris
Debtor's Counsel: Areya Aurzada, Esq.
HOLDER LAW
901 Main Street Suite 5320
Dallas, TX 75202
Tel: 972-438-8800
E-mail: areya@holderlawpc.com
Total Assets: $13,761,268
Total Liabilities: $11,294,174
The petition was signed by Fernando Sotelo, member.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/pnW8mN
List of Debtor's Eight Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Bluevine Monies Loaned/ $60,021
401 Warren Street, Suite 300 Advanced
Redwood City, CA, 94063
2. Jet Blue Credit Card Credit Card Debt $12,196
PO Box 8801
Wilmington, DE, 19899
3. Best Buy Credit Card Debt $11,394
Business Advantage Account
PO Box 731247
Dallas, TX, 75373
4. US Bank Credit Card Credit Card Debt $9,384
425 Walnut Street
Cincinnati, OH, 45202
5. American Express Credit Card Debt $9,355
Three World Financial Center
200 Versey Street
New York, NY, 10285
6. K&S Used Cars $9,162
c/o Eltiar Law, PLLC
4530 E. Belknap Street
Haltom City, TX, 76117
7. 60 Day Capital, LLC Non-Purchase $5,000
175 Great neck Road, Suite 206 Money
Great Neck, NY, 11201
8. First Corporate Solutions $0
914 S. Street
Sacramento, CA, 95811
SPEEDCAST INT'L: Davis Polk, Rapp Represent Secured Lender Group
----------------------------------------------------------------
In the Chapter 11 cases of SpeedCast International Limited, 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 Group of Secured Lenders.
The Ad Hoc Group of Secured Lenders formed by holders of loans
under that certain Syndicated Facility Agreement, dated as of May
15, 2018, by and among Speedcast and certain of its subsidiaries,
the lenders party thereto, the other parties thereto and Credit
Suisse AG, Cayman Islands Branch, as administrative agent,
collateral agent and security trustee, some Members of which also
committed to provide portions of a superpriority, secured
debtor-in-possession credit facility pursuant to that certain
Senior Secured Superpriority Debtor-In-Possession Term Loan Credit
Agreement, dated as of April 24, 2020, by and among Speedcast,
Speedcast Communications, Inc., the lenders party thereto and
Credit Suisse, as administrative agent, collateral agent and
security trustee.
In or around February 2020, the Ad Hoc Group of Secured Lenders
engaged Davis Polk to represent it in connection with the Members'
holdings of Prepetition Term Loans. In April 2020, the Ad Hoc Group
of Secured Lenders engaged Rapp & Krock to act as co-counsel in
these Chapter 11 Cases.
As of May 19, 2020, members of the Ad Hoc Group of Secured Lenders
and their disclosable economic interests are:
ALCENTRA NY, LLC
200 Park Avenue, 7th Floor
New York, NY 10166
* $34,143,542.59 in aggregate principal amount of Prepetition Term
Loans
BLACK DIAMOND CAPITAL MANAGEMENT, LLC
1 Sound Shore Drive, Suite 200
Greenwich, CT 06830
* $67,330,828.26 in aggregate principal amount of Prepetition Term
Loans
* $20,000,000 in aggregate principal amount of Prepetition RCF
Loans
* $43,601,387.17 in aggregate principal amount of new money loans
and commitments under the DIP Facility
* $16,956,095.01 in aggregate principal amount of Roll-Up Loans
CENTERBRIDGE PARTNERS, LP
375 Park Avenue, 11th Floor
New York, NY 10152
* $54,564,785.47 in aggregate principal amount of Prepetition Term
Loans
* $4,405,925.64 in aggregate principal amount of new money loans
and commitments under the DIP Facility
* $1,713,415.53 in aggregate principal amount of Roll-Up Loans
CRESCENT CAPITAL GROUP LP
11100 Santa Monica Boulevard, Suite 2000
Los Angeles, CA 90025
* $24,700,619.36 in aggregate principal amount of Prepetition Term
Loans
DOUBLELINE CAPITAL LP
333 South Grand Avenue, 18th Floor
Los Angeles, CA 90071
* $13,205,299.97 in aggregate principal amount of Prepetition Term
Loans
GOLDENTREE ASSET MANAGEMENT, LP
300 Park Avenue
New York, NY 10022
* $28,493,869.00 in aggregate principal amount of Prepetition Term
Loans
INVESCO SENIOR SECURED MANAGEMENT, INC.
1166 Avenue of the Americas, 26th Floor
NY 10036
* $19,342,329.95 in aggregate principal amount of Prepetition Term
Loans
MJX ASSET MANAGEMENT LLC
12 E 49th Street
New York, NY 10017
* $23,124,996.10 in aggregate principal amount of Prepetition Term
Loans
* $3,857,152.91 in aggregate principal amount of new money loans
and commitments under the DIP Facility
* $1,500,003.90 in aggregate principal amount of Roll-Up Loans
SHENKMAN CAPITAL MANAGEMENT, INC.
461 Fifth Avenue
New York, NY 10017
* $22,735,680.39 in aggregate principal amount of Prepetition Term
Loans
SIEMENS FINANCIAL SERVICES, INC.
170 Wood Ave.
South Iselin, NJ 08830
* $27,872,558.98 in aggregate principal amount of Prepetition Term
Loans
• $4,313,419.77 in aggregate principal amount of new money loans
and commitments under the DIP Facility
• $1,677,441.02 in aggregate principal amount of Roll-Up Loans
PGIM, INC.
655 Broad Street, 7th Floor
Newark, NJ 07102
* $11,384,796.27 in aggregate principal amount of Prepetition Term
Loans
* $5,284,543.92 in aggregate principal amount of new money loans
and commitments under the DIP Facility
* $2,055,100.42 in aggregate principal amount of Roll-Up Loans
VOYA INVESTMENT MANAGEMENT, LLC
7337 E. Doubletree Ranch Road, Suite 100
Scottsdale, AZ 85258
* $31,339,869.25 in aggregate principal amount of Prepetition Term
Loans
* $5,135,254.19 in aggregate principal amount of new money loans
and commitments under the DIP Facility
* $1,997,043.29 in aggregate principal amount of Roll-Up Loans
Counsel to the Ad Hoc Group of Secured Lenders 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.
David Schiff, Esq.
Jonah A. Peppiatt, Esq.
450 Lexington Avenue
New York, NY 10017
Telephone: (212) 450-4000
Facsimile: (212) 701-5800
Email: damian.schaible@davispolk.com
david.schiff@davispolk.com
jonah.peppiatt@davispolk.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://is.gd/bI0bQO
About SpeedCast International
Headquartered in New South Wales, Australia, SpeedCast
International Limited and its affiliates provide remote and
offshore satellite communications and information technology
services. SpeedCast's fully-managed service is delivered to more
than 2,000 customers in 140 countries via a global, multi-access
technology, multi-band and multi-orbit network of more than 80
satellites and an interconnecting global terrestrial network,
bolstered by on-the-ground local support from more than 40
countries. Speedcast services customers in sectors such as
commercial maritime, cruise, energy, mining, government, NGOs,
enterprise, and media.
SpeedCast International and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No.
20-32243) on April 23, 2020. At the time of the filing, the
Debtors were estimated to each have assets of between $500 million
and $1 billion and liabilities of the same range.
Judge David R. Jones oversees the cases.
The Debtors tapped Weil, Gotshal & Manges, LLP as bankruptcy
counsel; Herbert Smith Freehills as co-counsel with Weil; Moelis
Australia Ltd. as financial advisor; FTI Consulting Inc. as
restructuring advisor; and Kurtzman Carson Consultants LLC as
claims agent.
STEEL PARTNERS: June 4 Live Virtual Public Asset Auction Set
------------------------------------------------------------
GA Global Partners, LLC on May 27, 2020, disclosed that it will
conduct a live virtual public auction of the assets of Steel
Partners on June 4, 2020. The auction will feature Steel Partners'
metal fabrication equipment, material handling, powder coating
booth, steel inventory, trucks and trailers located in Las Vegas,
NV.
Steel Partners, a full-service steel contractor and major
structural metals fabricator, shuttered its operations after
serving the Las Vegas area for over 20 years. The company was
involved in over 2,000 structures and notable projects including
the Cannery Hotel Casino, Westin Hotel Casino, Monte Lago Resort,
and retail stores, such as Bass Pro Shops, Walmart, and Lowe's.
GA Global Partners is conducting the auction of Steel Partners'
assets by order of the U.S. Bankruptcy Court in the District of
Nevada. Items available for auction include a CNC press brake,
squaring shears, bending roll, welders, semi-automatic band saws,
ironworkers, power coating booth, telehandlers, forklifts,
trailers, and trucks from major brands such as Ford, Isuzu, Chevy,
and International.
"The metal fabrication, material handling, and steel inventory
available for auction present a unique opportunity for companies to
obtain equipment at a great value," said Paul Brown, Vice President
of GA Global Partners. "To ensure the safety of all parties, we
will conduct the auction virtually, which allows bidders to
participate online, while seeing and interacting directly with a
real time auctioneer."
The live auction will take place via webcast on June 4, 2020
starting at 10:00 a.m. PDT. Only online bids will be accepted.
Physical inspections will be held on June 3, 2020 from 9:00 a.m. to
5:00 p.m. PDT at 3625 Polaris Ave. Las Vegas, NV 89103. COVID-19
safety measures will be observed during inspections and pick-ups.
Interested bidders can pre-register and view auction details at
www.gaauction.com.
About GA Global Partners
For 40 years, GA Global has been a leading asset disposition
solutions provider to companies worldwide, leveraging real time
digital technologies and proven marketing expertise to reach a
broad network of qualified buyers around the world. From Fortune
500 companies to small business organizations in a variety of
industries ranging from construction, manufacturing, and wholesale
distribution to food and beverage, healthcare and consumer
products, GA Global has demonstrated its ability to move assets
quickly and efficiently for maximum return. GA Global is a
subsidiary of Great American Group, a B. Riley Financial company.
SVFOODS AVONDALE: Seeks to Hire Planche Politz as Accountant
------------------------------------------------------------
SVFoods Avondale LLC, and its debtor-affiliates seek permission
from the U.S. Bankruptcy Court for the Western District of
Louisiana to employ Planche Politz Ledet, LLC, as its certified
public accountants.
Planche Politz will serve as certified public accountants to the
Debtors in connection with the preparation of the Debtors' annual
year end accounting, federal and state tax returns, and Louisiana
personal property tax reports for the years ending Dec. 31, 2019
and Dec. 31, 2020; and, to provide related tax consulting services
which may be required in connection therewith nunc pro tunc to Dec.
23, 2019.
Planche Politz's hourly rates are:
Randy Ledet $315
Dwayne Hunter $275
Phillip Huynh $170
Terri Desadier $ 85
Planche Politzis a "disinterested person" as defined in section
101(14) of the Bankruptcy Code and as required bu section 327(a) of
the Bankruptcy Code, according to court filings.
The firm can be reached through:
Randy Ledet, CPA
Planche Politz Ledet, LLC
18212 East Petroleum Drive, Suite 1B
Baton Rouge, LA 70809
Phone: (225) 291-4141
About SVFoods Avondale
SVFoods Avondale LLC, et al. filed a voluntary Chapter 11 Petition
(Bankr. W.D. La. Case No. 19-51526) on December 23, 2019, and is
represented by William E. Steffes, Esq. and Noel Steffes Melancon,
Esq. The Debtor estimated under $1 million in both assets and
liabilities.
SVFoods Avondale LLC, and its debtor-affiliates owned and operated
retail grocery stores, located in Jefferson Parish, Louisiana and
Picayune, Mississippi; however, all such stores were closed prior
to their bankruptcy filing.
TECHNICAL COMMUNICATIONS: Incurs $361K Net Loss in First Quarter
----------------------------------------------------------------
Technical Communications Corporation reported a net loss of
$361,266 on $722,751 of net revenue for the three months ended
March 28, 2020, compared to net income of $172,608 on $1.93 million
of net revenue for the three months ended March 30, 2019.
The Company has suffered recurring losses from operations and had
an accumulated deficit of $2,997,000 at March 28, 2020. The
Company said these factors raise substantial doubt about the
Company's ability to continue as a going concern within one year
from the issuance date of the unaudited consolidated financial
statements included in this Quarterly Report.
The Company anticipates that its principal sources of liquidity
will only be sufficient to fund activities to December 2020. In
order to have sufficient cash to fund operations beyond that point,
the Company will need to secure new customer contracts, raise
additional equity or debt capital and/or reduce expenses, including
payroll and payroll-related expenses.
As of March 28, 2020, the Company had $2.63 million in total
assets, $1.23 million in total liabilities, and $1.40 million in
total stockholders' equity.
Carl H. Guild Jr., president and CEO of Technical Communications
Corporation, commented, "During the Company's first six months of
2020, revenue bookings slowed due to delays on several projects and
the associated field testing that was required. In January, the
negative effects of the COVID-19 pandemic began to adversely impact
our foreign customers' operations, causing project flow to
effectively shut down. As of this date, there are indications that
procurement action is resuming, albeit slowly. We expect that the
pre-virus projects remain viable and look to resume field testing
and project capture during the next six months."
Also, the Company received an order in May valued at $1.85 million
from ADS, Inc. for the Company's DSP9000 and HSE6000 encryption
systems. This order is in support of a foreign military sales
contract between the U.S. government and a Middle Eastern
government. Delivery of the equipment and training services are
expected to occur over the next six months.
Commenting on the contract award, Carl H. Guild, Jr. said, "This
order is an add-on to a contract on which we initially began
deliveries in September 2019. We are pleased that our customer has
again selected TCC systems to secure its military communications
network. We believe the combination of our quality systems,
commitment to meeting unique requirements, and full lifecycle
services have fostered this longstanding relationship. We also
expect additional follow-on sales as our customer continues to
expand its network."
A full-text copy of the Quarterly Report is available for free at
the Securities and Exchange Commission's website at:
https://is.gd/LDJopb
About Technical Communications
Concord, Massachusetts-based Technical Communications Corporation
-- http://www.tccsecure.com/-- specializes in secure
communications systems and customized solutions to protect highly
sensitive voice, data and video transmitted over a wide range of
networks.
As of Dec. 28, 2019, the Company had $2.85 million in total assets,
$1.09 million in total liabilities, and $1.75 million in total
stockholders' equity.
Stowe & Degon LLC, in Westborough, Massachusetts, the Company's
auditor since 2019, issued a "going concern" qualification in its
report dated Dec. 5, 2019, on the consolidated financial statements
for the year ended Sept. 28, 2019 citing that for the fiscal year
ended Sept. 28, 2019 the Company generated $631,000 of net income,
however for the prior seven year period from fiscal 2012 to fiscal
2018, the Company suffered recurring losses from operations and has
an accumulated deficit of $2,155,000 at Sept. 28, 2019. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
TNTMD PA: Unsec. Creditors to Receive $3K Per Quarter Over 5 Years
------------------------------------------------------------------
TNTMD, P.A. d/b/a Tillis Eye Care Center, a Florida Professional
Association, filed with the U.S. Bankruptcy Court for the Middle
District of Florida, Jacksonville Division, a Combined Disclosure
Statement and Chapter 11 Plan of Reorganization dated May 12,
2020.
Class 4 consists of the All General Unsecured Claims, which include
the unsecured portion of Proof of Claim 9 filed by Bankers
Healthcare Group, LLC. In full satisfaction of Class 4 Claims, the
Debtor will pay $3,000 a quarter on a pro rata basis for 60 months.
There are no pre-payment penalties on this Class.
Class 5 consists of any claim held by Equity Holders/Insiders.
Equity Holders and Insiders will receive no distribution under this
Plan but will retain the same ownership as they did prior to the
Petition Date.
Given the refined debt service as provided in the Plan, the Debtor
will continue its operations which will cover the required new debt
service payments.
Pursuant to Section 1141 of the Bankruptcy Code, the property of
the Estate of the Debtor shall vest in the Debtor.
A full-text copy of the Combined Plan and Disclosure Statement
dated May 12, 2020, is available at https://tinyurl.com/yd7ojmjo
from PacerMonitor at no charge.
Counsel for Debtor-In-Possession:
The Law Offices of Jason A. Burgess, LLC
Jason A. Burgess
1855 Mayport Road
Atlantic Beach, Florida 32233
Phone: (904) 372-4791
About TNTMD, P.A.
TNTMD, P.A., operates as a private ophthalmology practice with its
operation located in Jacksonville, Florida. The company was formed
in 2011.
TNTMD, P.A., filed a Chapter 11 bankruptcy petition (Bankr. M.D.
Fla. Case No. 20-00291) on Jan. 29, 2020, disclosing under $1
million in both assets and liabilities. Judge Cynthia C. Jackson
oversees the case. The Debtor is represented by Jason A. Burgess,
Esq., at the Law Offices of Jason A. Burgess, LLC.
TUPPERWARE BRANDS: Moody's Cuts CFR to Caa3, Outlook Negative
-------------------------------------------------------------
Moody's Investors Service downgraded Tupperware Brands
Corporation's Corporate Family Rating to Caa3 from B3, its
Probability of Default Rating to Caa3-PD from B3-PD and its senior
unsecured notes rating to Ca from Caa2. The Speculative Grade
Liquidity Rating is unchanged at SGL-4. The outlook remains
negative.
These actions follow Tupperware's May 26 announcement that it would
launch a tender offer to purchase for cash up to $175 million of
its $600 million senior unsecured notes due June 1, 2021. [1] The
company expects to spend about $79 million to retire roughly one
third of the notes based on the June 8 early tender deadline offer
price of $450 per $1,000 of principal. The transaction represents a
significant discount to par that indicates a loss of value for
creditors and is material relative to the company's roughly $1.2
billion of debt incorporating incremental revolver drawdowns in
late March. If completed based on the terms outlined, Moody's would
consider the transaction a distressed exchange, which is a default
under the rating agency's definition. As such, upon close of the
transaction, Moody's would append the PDR with an "/LD" designation
to indicate a limited default, which will be removed after
approximately three business days. Bond investors that tender after
June 8 and by June 22 would receive $420 for $1,000 of principal.
The downgrade to a Caa3 CFR reflects that Tupperware's significant
earnings erosion in 2020, the difficulty of executing a meaningful
turnaround in the current recessionary economic environment, high
leverage, approaching maturity of the remaining senior unsecured
notes, and risk of a covenant violation create elevated default
risk. As of the twelve months ended March 28, 2020, Tupperware's
debt to EBITDA (including Moody's adjustments) was at roughly 5.1x,
and Moody's estimates that debt to EBITDA will exceed 7.5x by the
end of 2020 because of weakening sales and earnings despite the
debt reduction from the proposed transaction. Tupperware's revenue
and earnings continue to decline in 2020, and efforts to contain
the coronavirus are weakening economic growth globally and add
further operating pressure on Tupperware.
The company's independent sales force is a significant revenue
driver across the company's direct selling business model, and the
ongoing declines in active representatives continues to negatively
affect business performance. Social elements including changes to
consumer shopping patterns and the attractiveness of individuals
serving as Tupperware sales representatives are also negatively
affecting the company's direct selling business model. Recent
senior management appointments bring important direct selling and
consumer product experience, but the magnitude of the operating
challenges and difficult economic environment present considerable
headwinds to materially improving earnings and cash flow in a short
time period even with good execution and cost reductions. The
downgrade also reflects weak liquidity, highlighted by a $425
million debt maturity in June 2021 assuming the tender is completed
at the proposed terms and the risk of additional distressed
exchanges or a more comprehensive balance sheet restructuring over
the next 12 months. Continued significant revenue and operating
cash flow erosion will make it challenging for Tupperware to
economically refinance the 2021 notes at par. Moody's believes the
current level of debt is not sustainable without a significant
operational turnaround.
The negative outlook reflects uncertainty regarding the company's
ability to quickly stabilize declines in its sales force, operating
earnings and cash flow, and to refinance the bonds at par. Moody's
also recognizes the challenges that Tupperware will face given
governmental mandates for social distancing that directly contrasts
with the company's inherent direct selling business model.
The following is a summary of Moody's rating actions:
Tupperware Brands Corporation
Ratings downgraded:
Corporate Family Rating to Caa3 from B3;
Probability of Default Rating to Caa3-PD from B3-PD;
Senior unsecured rating to Ca (LGD5) from Caa2 (LGD5);
Outlook:
The rating outlook on all ratings remains negative.
RATINGS RATIONALE
Tupperware's Caa3 CFR reflects the company's elevated financial
leverage and corporate governance risks associated with
management's approach to capital structure and liability management
in the face of a number of operating challenges. Tupperware faces
challenges related to its core business, including returning its
direct selling business to long term revenue growth. Moody's
believes that competitive, economic, and structural headwinds will
continue to create challenges for the company to stem revenue
declines and quickly execute an operational turnaround. The ratings
also reflect elevated default risk related to the June 2021 note
maturity amid weak operating performance, economic conditions, and
high financial market volatility. The company's unique direct
selling business model is highly reliant upon its ability to
recruit and retain sales representatives around the world. There is
risk to direct sellers in developing markets as increasing retail
penetration, e-commerce activity, and competition gradually
diminish the current distribution advantages. Developing markets
also tend to include more volatile economies and foreign exchange
rate exposure. In addition, the company's modest scale relative to
other consumer product peers and sensitivity to discretionary
consumer spending heighten credit risks. The ratings are supported
by Tupperware's well-recognized brand name supported by good
product development capabilities, and global selling and
distribution capabilities.
The SGL-4 Speculative Grade Liquidity rating reflects Tupperware's
weak liquidity. Tupperware's $600 million unsecured bonds are due
in June 2021 and Moody's does not believe the company has
sufficient cash, free cash flow and unused revolver capacity to
address the maturity. Moody's expects the company to generate
negative free cash flow over the next 12 months of about $(15) to
$(20) million reflecting weak earnings and cash costs necessary to
restructure the business.
Social risks are a meaningful consideration given the company's
direct sales business model. The current potential impact of the
coronavirus on the sales force and mandates for social distancing,
changing demographics, economic and employment conditions can
affect the company's ability to recruit and retain its sales force
and can also influence how consumers shop. The business model can
also come under scrutiny by regulators. Tupperware also faces
important corporate governance challenges reflecting meaningful
turnover at the senior management ranks, although Moody's views the
focus of new senior management on consumer needs to create
long-term sustainable value and turn around the business is
positive. Environmental considerations are not considered material
to Tupperware's credit profile, but the company must monitor its
land, water, energy and raw material usage.
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
products sector has been one of the sectors affected by the shock
given its sensitivity to consumer demand and sentiment. More
specifically, the weaknesses in Tupperware'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. Its action
in part reflects the impact on Tupperware of the breadth and
severity of the shock, and the broad deterioration in credit
quality it has triggered.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Tupperware's ratings could be downgraded if the company is unable
to successfully refinance its upcoming 2021 debt maturities in a
timely manner. Ratings could also be downgraded if the company does
not stabilize sales representative counts, revenue and earnings.
Deteriorating liquidity or an adverse shift in the regulatory
environment could also lead to a downgrade.
Given the negative outlook ratings are unlikely to be upgraded.
That said, before Moody's would consider an upgrade, Tupperware
would need to materially improve its operating performance. The
company would also need to reduce leverage, and address the note
maturity for an upgrade to be considered.
Tupperware Brands Corporation is a global manufacturer and direct
seller of consumer products across multiple categories including
food storage, preparation and serving items, and beauty and
personal care products. Products are sold through a worldwide sales
force that includes approximately 3 million independent dealers.
Tupperware is publicly traded and generated approximately $1.7
billion in annual revenue.
The principal methodology used in these ratings was Consumer
Packaged Goods Methodology published in February 2020.
TYSON FOODS: Non-Supervisory Staff Wage-Fixing Class Suit Ongoing
-----------------------------------------------------------------
Tyson Foods, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 4, 2020, for the
quarterly period ended March 28, 2020, that the company continues
to defend a consolidated class action lawsuit regarding alleged
fixing of the rates of wages for non-supervisory production and
maintenance workers.
On August 30, 2019, Judy Jien, Kieo Jibidi and Elaisa Clement,
acting on their own behalf and a putative class of non-supervisory
production and maintenance employees at chicken processing plants
in the continental United States, filed a class action complaint
against the company and certain of its subsidiaries, as well as
several other poultry processing companies, in the United States
District Court for the District of Maryland.
An additional complaint making similar allegations was also filed
by Emily Earnest.
The plaintiffs allege that the defendants directly and through a
wage survey and benchmarking service exchanged information
regarding labor rates in an effort to depress and fix the rates of
wages for non-supervisory production and maintenance workers in
violation of federal antitrust laws.
The plaintiffs seek, among other things, treble monetary damages,
punitive damages, restitution, and pre- and post-judgment interest,
as well as declaratory and injunctive relief. The court
consolidated the Jien and Earnest cases for coordinated pretrial
proceedings.
Following the consolidation, two additional lawsuits have been
filed by individuals making similar allegations. The plaintiffs
filed an amended consolidated complaint containing additional
allegations concerning turkey processing plants and named
additional defendants.
Tyson Foods, Inc., together with its subsidiaries, operates as a
food company worldwide. It operates through four segments:
Beef,Pork, Chicken, and Prepared Foods. Tyson Foods, Inc. was
founded in 1935 and is headquartered in Springdale, Arkansas.
UNIT CORP: Receives Delisting Notice From New York Stock Exchange
-----------------------------------------------------------------
Unit Corporation on May 26, 2020, disclosed that it has received
notification from the New York Stock Exchange (the "NYSE") that the
Company's common stock has been suspended from trading on the NYSE
and that the NYSE has determined to commence proceedings to delist
the Company's common stock. The NYSE determined that the Company
was no longer suitable for listing under Section 802.01D of the
NYSE Listed Company Manual after the Company's May 22, 2020
disclosure that it and certain of its subsidiaries filed voluntary
petitions for relief under Chapter 11 of the United States
Bankruptcy Code in the U.S. Bankruptcy Court for the Southern
District of Texas, Houston Division. The Company does not
presently anticipate exercising its right to appeal the NYSE's
delisting determination.
The Company's common stock will begin to be quoted on the OTC Pink
marketplace on May 27, 2020 under the symbol "UNTCQ". Investors
can find quotes for the Company's common stock on
www.otcmarkets.com. The Company does not expect the transition to
the OTC Pink marketplace to affect the Company's business
operations.
About Unit Corporation
Unit Corporation (NYSE- UNT) (OTC Pink- UNTCQ) --
http://www.unitcorp.com/-- is a Tulsa-based, publicly held energy
company engaged through its subsidiaries in oil and gas
exploration, production, contract drilling and natural gas
gathering and processing.
On May 22, 2020, Unit Corporation and five affiliates sought
Chapter 11 protection (Bankr. S.D. Tex. 20-32740) with a
pre-negotiated plan that reduces debt by $650 million.
Unit Corp. disclosed $2,090,052,000 in assets and $1,034,417,000 in
debt as of Dec. 31, 2019.
Vinson & Elkins L.L.P. is serving as legal advisor, Evercore Group
L.L.C. is serving as investment banker, and Opportune LLP is
serving as restructuring advisor to the Company. Prime Clerk LLC
is the claims agent, maintaining the page
https://cases.primeclerk.com/UnitCorporation
Weil, Gotshal & Manges LLP is serving as legal advisor and
Greenhill & Co., LLC is serving as financial advisor to an ad hoc
group of holders of Subordinated Notes.
UNITED AIRLINES: Moody's Confirms Ba2 CFR & Ba3 Sr. Unsec. Rating
-----------------------------------------------------------------
Moody's Investors Service confirmed the Ba2 corporate family,
Ba2-PD probability of default and Ba3 senior unsecured ratings
assigned to United Airlines Holdings, Inc., and downgraded
subsidiary United Airlines, Inc.'s senior secured rating to Ba1
from Baa3. Moody's also confirmed all of its ratings on the
company's Enhanced Equipment Trust Certificates. The outlook is
negative. Its rating actions conclude the review for downgrade of
all ratings initiated on March 17, 2020.
The downgrade of the senior secured rating reflects the increasing
proportion of senior secured obligations in the company's capital
structure, which leads to a modeled higher loss rate for this class
of claims when applying Moody's Loss Given Default rating
methodology.
The spread of the coronavirus pandemic, the weakened global
economic outlook, low oil prices and asset price declines are
sustaining a severe and extensive credit shock across many sectors,
regions and markets. The combined credit effects of these
developments are unprecedented. The passenger airline industry is
one of the sectors most significantly affected by the shock given
its exposure to travel restrictions and sensitivity to consumer
demand and sentiment. Moody's regards the coronavirus outbreak as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Its confirmation of the
Ba2 corporate family rating balances United's good liquidity
against the breadth and severity of the coronavirus' shock and the
uncertain trend in passenger demand in upcoming years. United is
also likely to experience the slowest recovery in aggregate demand
compared to US peers, Delta Air Lines and American Airlines
because, at about 40% of passenger revenue, its international
network is the largest of the three, including a trans-Pacific
operation that is almost three times as large as those of the other
two companies. Trans-Pacific flying accounts for about 15% of
United's total traffic.
Its rating actions reflect Moody's expectation that the coronavirus
pandemic will continue to significantly curtail US domestic and
global demand for air travel for an extended period. Moody's
assumed that United's Q4 2020 capacity would be down about 50%
versus Q4 2019 in its faster recovery model and about 70% in its
slower recovery model. These scenarios also assume that passenger
demand substantially increases towards 2019 levels in 2023 and that
refined cost management and efficiencies learned while managing the
operations through the pandemic will support a meaningful recovery
in profit margins by 2023. In all scenarios, the reduction in
passenger demand is greater than the reduction in capacity, leading
to meaningfully lower load factors. The risk of more challenging
downside scenarios remains high and the severity and duration of
the pandemic and travel restrictions also remain highly uncertain,
particularly given the threat of an increase in the number of
infections as social distancing practices across the US and other
countries become less stringent in upcoming weeks.
The negative outlook reflects the potential for greater than
already anticipated impacts of the coronavirus, which would consume
more of the company's liquidity and delay the pace and scope of the
recovery in demand, the retirement of debt and the strengthening of
credit metrics versus Moody's current expectations. Nonetheless,
good liquidity currently mitigates downwards pressure on United's
corporate family rating.
LIQUIDITY
Cash and short-term investments totaled $9 billion on May 15th. In
March and April, United raised about $1.1 billion of new equity and
raised about $3 billion of secured debt including $2.75 billion of
364-day facilities that will expire in March or April 2021. The $2
billion revolving credit facility due in April 2022 remains
undrawn. United will receive $5 billion under the Payroll Support
Program of the US Coronavirus Aid, Relief, and Economic Security
Act. Of this amount, $1.53 billion will be in the form of a
10-year, unsecured loan. A CARES Act secured loan of $4.5 billion
will also be available to United through September 30, 2020, should
it decide to utilize this part of the program. Unsecured assets
with estimated value of about $10 billion -- excluding the
MileagePlus loyalty program -- remain available for additional
financing, as does a likely forward sale of miles, if needed.
A commitment to return on capital and profit maximization rather
than market share strategies, declines in unemployment rates,
passenger demand and oil price levels will be key determinants of
United's future cash generation that will inform the potential pace
of deleveraging the capital structure. United spent $8.9 billion on
fuel and invested $5 billion on capital expenditures and returned
$1.6 billion to shareholders in 2019. With the CARES Act
prohibition on returns to shareholders for one year after the
repayment of loans, expected significant reductions in capital
expenditures and likely materially lower fuel prices, there is the
potential for United to sequentially and cumulatively retire a
significant amount of the incremental coronavirus-related debt
incurred in 2020, as demand recovers through 2023.
RATINGS RATIONALE
The Ba2 corporate family rating reflects United's favorable
business profile as the third largest US and global airline based
on revenue, and the benefits to earnings of the improvements in
service delivery and operational reliability of the past 24 months.
Credit metrics, including debt-to-EBITDA of 2.7x and free cash flow
to debt of 9.7%, heading into 2020 well supported the Ba2 corporate
family rating. Holding the Ba2 corporate family rating at this time
considers Moody's belief that United will prioritize debt reduction
in the post-coronavirus years to restore its credit metrics to
pre-coronavirus levels.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The corporate family rating could be downgraded if Moody's believes
the coronavirus will constrain passenger demand for an extended
period well into 2021 and or credit metrics. Aggregate of cash and
available revolver falling below $5 billion could pressure the
ratings as could clear expectations that United will not be able to
timely restore its financial profile once the virus recedes (for
example, if debt-to-EBITDA is sustained above 4x or funds from
operations plus interest-to-interest is sustained below 4.5x).
There will be no upwards pressure on ratings until after passenger
demand returns to pre-coronavirus levels and United maintains
liquidity above $6 billion, and key credit metrics improve, as
indicated by EBITDA margins above 18%, debt-to-EBITDA below 3x and
funds from operations plus interest-to-interest of about 6x.
Ratings on corporate (non-EETC) debt instruments could change with
no change in the corporate family rating because of changes in the
relative contribution of senior secured and senior unsecured
obligations in the company's capital structure. For example, the
$1.5 billion loan portion of the CARES Act Payroll Support Payments
is an unsecured obligation; the $4.5 billion CARES Act loan, if
drawn, will be secured. The previously arranged $2.75 billion of
364-day facilities also increased secured claims in the LGD
waterfall, which will be sustained if termed out by the maturity
date in March 2021. Adding either materially larger amounts of
secured debt than unsecured debt or material amounts of one but not
the other can lower the ratings of each class.
Changes in the EETC ratings can result from any combination of
changes in the underlying credit quality or ratings of the company,
Moody's opinion of the importance of the aircraft collateral to the
operations, and/or its estimates of current and projected aircraft
market values, which will affect estimates of loan-to-value and
potentially, increase the probability of a rejection of a
transaction in a bankruptcy scenario.
The methodologies used in these ratings were Enhanced Equipment
Trust and Equipment Trust Certificates published in July 2018.
The following rating actions were taken:
Downgrades:
Issuer: United Airlines, Inc.
Senior Secured Bank Credit Facility, Downgraded to Ba1 (LGD2) from
Baa3 (LGD2)
Confirmations:
Issuer: United Airlines Holdings, Inc.
Corporate Family Rating, Confirmed at Ba2
Probability of Default Rating, Confirmed at Ba2-PD
Senior Unsecured Shelf, Confirmed at (P)Ba3
Senior Unsecured Regular Bond/Debenture, Confirmed at Ba3 (LGD5)
Issuer: United Air Lines, Inc.
Senior Secured Pass-Through, Confirmed at Ba1
Issuer: United Airlines, Inc.
Senior Secured Enhanced Equipment Trust, Confirmed at A1
Senior Secured Enhanced Equipment Trust, Confirmed at Ba1
Senior Secured Enhanced Equipment Trust, Confirmed at Baa1
Senior Secured Enhanced Equipment Trust, Confirmed at Baa2
Senior Secured Enhanced Equipment Trust, Confirmed at Baa3
Senior Secured Equipment Trust, Confirmed at Ba1
Issuer: CLEVELAND (CITY OF) OH
Senior Unsecured Revenue Bonds, Confirmed at Ba3 (LGD5)
Issuer: Denver (City & County of) CO
Senior Unsecured Revenue Bonds, Confirmed at Ba3 (LGD5)
Issuer: Hawaii Department of Transportation
Senior Unsecured Revenue Bonds, Confirmed at Ba3 (LGD5)
Issuer: Houston (City of) TX
Senior Unsecured Revenue Bonds, Confirmed at Ba3 (LGD5)
Issuer: NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY
Senior Unsecured Revenue Bonds, Confirmed at Ba3 (LGD5)
Outlook Actions:
Issuer: United Airlines Holdings, Inc.
Outlook, Changed to Negative from Rating Under Review
Issuer: United Airlines, Inc.
Outlook, Changed to Negative from Rating Under Review
United Airlines Holdings, Inc. is the holding company for United
Airlines, Inc. United Airlines and United Express operated an
average of 4,900 flights daily to 362 airports across six
continents before the coronavirus. In 2019, United and United
Express operated more than 1.7 million flights carrying more than
162 million customers. The company reported $43.3 billion of
revenue in 2019.
VIRTUAL CITADEL: Bay Point Advisors Provides $7.5M DIP Loan
-----------------------------------------------------------
Bay Point Advisors on May 22, 2020, disclosed that it has entered
into a senior secured debtor-in-possession ("DIP") financing
agreement with a network of blockchain mining companies comprising
VC Mining Enterprises Inc., Godby DC-5 LLC, Godby DC-4 LLC,
Hemphill Avenue LLC, and Virtual Citadel LLC (collectively "the
Company"), which has filed for bankruptcy protection under Chapter
11 under the United States Bankruptcy Code.
Under the agreement, Bay Point Advisors has committed $7.5 million
in new funding to support the Company through the Chapter 11
process. This additional financing provides the Company with a
strong financial foundation to support existing operations,
restructure costs, and satisfy prior debt obligations.
The Company will work expediently with its stakeholders towards
establishing a consensual Chapter 11 plan to maintain existing
infrastructure while ensuring consistent operations. The Company
expects to implement necessary restructuring that will lead to
profitable on-going operations and a potential sale of the Company.
Marshall Glade of Glass Ratner is serving as the restructuring
advisor and David Gordon of Polsinelli is serving as The
Company’s legal advisor. John Isbell of the Law Offices of John
F. Isbell LLC served as legal advisor to Bay Point Advisors.
"This is another example of Bay Point Advisors working with a
distressed borrower through a difficult situation to maximize value
for all stakeholders. We look forward to working with others in
similar situations in the future," said Charles Andros, President
and Chief Investment Officer of Bay Point Advisors.
"Bay Point Advisors stepped up in a difficult situation and has
allowed the debtor time and flexibility to enhance creditor
recoveries. Their knowledge and comfortability with the bankruptcy
process has made them a great partner to work with," said Marshall
Glade of Glass Ratner.
About Bay Point Advisors
Since inception in 2012, Bay Point Advisors, a specialty lender
focused on asset-based loans of all types, closed over $200 million
in loans in 2019. Bay Point Advisors lends to small and mid-sized
businesses, designing custom funding solutions that meet the unique
needs of each business. Examples of secured lending include
commercial and residential real estate, development financing,
private business funding, bridge loans and debtor-in-possession
financing.
About Virtual Citadel
Virtual Citadel, Inc. -- https://vcitadel.com/ -- is a
comprehensive turnkey enterprise hosting provider in Atlanta,
Georgia. Citadel owns and operates tier 1 and tier 2 data centers
throughout the metro Atlanta area. Founded in 1990, vCitadel
provides custom hosting solutions for cloud, data, and co-location
applications.
Virtual Citadel, Inc., and four affiliates sought Chapter 11
protection (Bankr. N.D. Ga. Case No. 20-62725) on Feb. 14, 2020.
The Debtors tapped Polsinelli PC as counsel; Baker, Donelson
Bearman, Caldwell & Berkowitz, PC as conflicts counsel; Glass
Ratner as financial advisor; and Highgate Partners LLC as real
estate broker.
WASHINGTON PRIME: Moody's Lowers Corp. Family Rating to Caa3
------------------------------------------------------------
Moody's Investors Service has downgraded the senior unsecured debt
and corporate family ratings of Washington Prime Group, L.P. to
Caa3 from Caa1. Washington Prime Group, L.P. is the main operating
subsidiary of Washington Prime Group Inc. Moody's has also
downgraded WPG's preferred stock rating to C from Caa3. Its rating
actions conclude the review for downgrade initiated on March 19,
2020. The speculative grade liquidity rating was maintained at
SGL-4. The outlook is negative, reflecting its expectation that the
REIT will face escalating operating challenges amidst a weak retail
environment. The outlook also considers WPG's high leverage and
weak liquidity position, including the potential for it to breach
its debt covenants.
The following ratings were downgraded:
Issuer: Washington Prime Group, L.P.
- Senior unsecured debt to Caa3 from Caa1
- Senior unsecured shelf to (P)Caa3 from (P)Caa1
- Corporate family rating to Caa3 from Caa1
Issuer: Washington Prime Group Inc.
- Preferred stock to C from Caa3
- Preferred stock shelf to (P)C from (P)Caa3
- Preferred stock shelf non-cumulative to (P)C from (P)Caa3
Outlook Actions:
Issuers: Washington Prime Group, L.P.; Washington Prime Group Inc.
- Outlooks changed to Negative from Rating Under Review
RATINGS RATIONALE
WPG's Caa3 corporate family rating reflects its large,
geographically diversified portfolio of retail assets, which
includes a mix of enclosed malls (71% of Comp NOI) and open-air
centers (29%) across the US. The REIT's open-air portfolio is a key
credit strength as it provides it with more stable, higher quality
cash flows, offsetting challenges associated with its mall
portfolio. WPG also benefits from solid fixed charge coverage and a
large unencumbered asset pool that provides some financial
flexibility and good coverage for the REIT's unsecured debt.
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 retail sector
has been one of the sectors most significantly affected by the
shock given its sensitivity to consumer demand and sentiment. More
specifically, the weaknesses in WPG's credit profile, including its
exposure to potential tenant store closures and bankruptcies have
left it vulnerable to shifts in market sentiment in these
unprecedented operating conditions and WPG 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. Its action
reflects the impact on WPG of the breadth and severity of the
shock, and the broad deterioration in credit quality it has
triggered.
WPG's leverage was high at 9.3x for 1Q20 (LTM, including pro rata
JVs and treating 75% of preferred stock as debt) and is expected to
increase substantially given the weak operating outlook. Most of
WPG's enclosed malls closed in mid-March due to the coronavirus
outbreak and have only recently started reopening. The store
closures severely impacted tenants' sales, as well as their ability
and willingness to pay rent to WPG -- the REIT has addressed 11% of
contractual rents due for 2Q20 through lease modifications and,
based on these modifications, expects to collect about 45% of
contractual rents and charges due for 2Q20. Moody's expects the
weak macro environment will cause an escalating number of tenant
bankruptcies and store closures in the coming months, with low
productivity mall owners like WPG experiencing a disproportionate
impact.
WPG's SGL-4 rating reflects its weak liquidity profile as it
considers the likelihood that declines in operating cash flow will
cause it to breach financial covenants in its unsecured debt
agreements. The REIT recently indicated that based upon
conversations with its unsecured creditors it believes that it will
be able to remain compliant with such covenants through some
combination of waivers, modifications or other amendments to the
related agreements. However, it also warned that if it is unable to
reach such agreements, this could create substantial doubt about
its ability to continue as a going concern through May 7, 2021.
Moody's expects that the REIT's sizable unencumbered asset pool
will offer flexibility as it undertakes these negotiations.
WPG's liquidity is limited, as it drew down the remaining capacity
on its $650mm unsecured facility in April and had $150mm cash as of
May 1, 2020. The REIT will need to access external capital and
strengthen its financial position as it looks to refinance its
revolver that has an original maturity date in December 2021 (plus
two six-month extension options) and $350 million term loan due in
December 2022. Positively, Moody's notes that WPG has suspended its
common dividend, which will provide incremental capital to fund its
strategically important development pipeline (in conjunction with
modest outparcel sales). WPG also has a large unencumbered asset
pool, which has many good quality assets including a large
percentage of open-air centers. This portfolio provides some
financial flexibility, with estimated asset value providing good
coverage of unsecured debt.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the REIT's weak operating outlook and liquidity risks, an
upgrade is unlikely in the foreseeable future until Moody's sees
signs of material growth in mall cash flows and stronger liquidity
as evidenced by less reliance on the credit line for funding.
WPG's ratings would likely be downgraded should its liquidity
position further erode or if it were to enter into a restructuring
agreement that diminished the size of its unencumbered assets
pool.
The principal methodology used in these ratings was REITs and Other
Commercial Real Estate Firms published in September 2018.
Washington Prime Group Inc. [NYSE: WPG] is a retail REIT that owns
a mix of enclosed malls and open-air centers across the United
States. Gross assets totaled $7.6 billion including pro rata share
of JVs as of 1Q20.
WATERS RETAIL: Hires LandQwest Commercial as Real Estate Broker
---------------------------------------------------------------
Waters Retail TPA, LLC, and its debtor-affiliates seek authority
from the United States Bankruptcy Court for the Northern District
of Texas to hire LandQwest Commercial, LLC, as their real estate
broker.
LandQwest will provide general real estate brokerage services to
the Debtors in connection with the Chapter 11 Cases, including,
without limitation, pre-marketing due diligence on the Debtors'
Properties, developing a customized marketing campaign, and
otherwise using its best efforts to secure one or more satisfactory
buyers to purchase the Debtors' Properties.
LandQwest will charge the Debtors a commission for 4 percent - 6
percent of the gross sales price relating to the
sale of the Property and Assets. The 4 percent structure will be
paid if no other broker is engaged by the buyer; while the 6
percent will be earned if LandQwest must split its commission with
a buyer's broker.
LandQwest does not represent, and does not hold, any interest
adverse to the Debtors' estates; and is a "disinterested person"
within the meaning of section 101(14) of the Bankruptcy Code,
according to court filings.
The broker can be reached through:
https://writenewsnow.com/wp-admin/post-new.php
John Mounce
LandQwest Commercial. LLC
1614 Colonial Blvd, #101
Fort Myers, FL 33907
Phone: (239) 275-4922
Email: jmounce@lqwest.gov
About Waters Retail TPA, LLC
Waters Retail TPA, LLC is a Single Asset Real Estate debtor (as
defined in 11 U.S.C. Section 101(51B)).
Waters Retail TPA, LLC, filed its voluntary petition under Chapter
11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 20-30644) on
Feb. 27, 2020. In the petition signed by Donald L. Silverman,
manager, the Debtor estimated $1 million to $10 million in both
assets and liabilities. Vickie L. Driver, Esq. at CROWE & DUNLEVY,
P.C., represents the Debtor as counsel.
WELDED CONSTRUCTION: Unsec. Creditors to Have 21% Recovery in Plan
------------------------------------------------------------------
Debtors Welded Construction, L.P., and Welded Construction
Michigan, LLC filed the Amended Disclosure Statement for the
Amended Chapter 11 Plan dated May 8, 2020.
The Debtors estimate that Holders of Allowed Surety Bond Claims in
these Chapter 11 Cases should recover approximately 21% of the
total amount of their Allowed Claims. The Debtors further estimate
that Holders of Allowed General Unsecured Claims in the Chapter 11
Cases should recover approximately 21% of the total amount of their
Allowed Claims. The Debtors have calculated these projected
recoveries for Holders of Surety Bond Claims and General Unsecured
Claims by taking into account, among other variables: (a) the total
estimated amount of Allowed Surety Bond Claims and Allowed General
Unsecured Claims; and (b) the total estimated amount of Cash
available for Distributions to Holders of Allowed Surety Bond
Claims and Allowed General Unsecured Claims.
To date, the amount of filed Surety Bond Claims not currently
subject to a pending objection is $580.8 million, and the amount of
filed General Unsecured Claims fully adjudicated or subject to a
pending objection is approximately $205.8 million. However, the
Debtors estimate that the anticipated Allowed Surety Bond Claims
approximate $76.1 million, and anticipated Allowed General
Unsecured Claims approximate $20.7 million, subject to potential
adjustments. The Debtors estimate that the number of Allowed
General Unsecured Claims, excluding Convenience Class Claims, is
approximately 68. The estimated amount and number of Convenience
Class Claims is, respectively $5.0 million and 366.
As of April 20, 2020, the Debtors' Cash on hand in the aggregate is
approximately $28.2 million. The Debtors estimate Cash available
for Distributions for Allowed Surety Bond Claims, Allowed General
Unsecured Claims and Allowed Convenience Class Claims of
approximately $26.5 million. This does not take into account any
potential recoveries with respect to the Retained Causes of Action
that the Plan Administrator may pursue.
A full-text copy of the Amended Disclosure Statement and Plan dated
May 8, 2020, is available at https://tinyurl.com/y7gel5xy from
PacerMonitor at no charge.
Counsel to the Debtors:
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Sean M. Beach
Matthew B. Lunn
Robert F. Poppiti, Jr.
Allison S. Mielke
Betsy L. Feldman
1000 North King Street
Wilmington, DE 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
E-mail: sbeach@ycst.com
mlunn@ycst.com
rpoppiti@ycst.com
amielke@ycst.com
bfeldman@ycst.com
About Welded Construction
Perrysburg, Ohio-based Welded Construction, L.P., is a mainline
pipeline construction contractor capable of executing pipeline
construction projects in lengths ranging from a few hundred feet to
over 200 miles.
Welded Construction, L.P., and Welded Construction Michigan, LLC,
sought bankruptcy protection on Oct. 22, 2018 (Bankr. D. Del. Lead
Case No. 18-12378). The jointly administered cases are pending
before Judge Kevin Gross.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP as counsel;
and Kurtzman Carson Consultants LLC as claims and noticing agent
and administrative advisor. The Debtors also tapped Zolfo Cooper
Management, LLC and the firm's managing director Frank Pometti who
will serve as their chief restructuring officer.
An official committee of unsecured creditors was appointed on Oct.
30, 2018. The committee tapped Blank Rome LLP as its legal counsel
and Teneo Capital LLC as its investment banker and financial
advisor.
WESTJET AIRLINES: Moody's Cuts CFR to B3 & Sr. Sec. Rating to B2
----------------------------------------------------------------
Moody's Investors Service has downgraded WestJet Airlines Ltd.
Corporate Family Rating to B3 from Ba3, Probability of Default
rating to B3-PD from Ba3-PD, and senior secured rating to B2 from
Ba2. The outlook is negative.
This rating action concludes the review process initiated on March
18, 2020.
The spread of the coronavirus outbreak, the deteriorating global
economic outlook, low oil prices, and asset price declines are
sustaining a severe and extensive credit shock across many sectors,
regions and markets. The combined credit effects of these
developments are unprecedented. The passenger airline industry is
one of the sectors most significantly affected by the shock given
its exposure to travel restrictions and sensitivity to consumer
demand and sentiment. Moody's regards the coronavirus outbreak as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Its downgrade of
WestJet's ratings reflects the breadth and severity of the
coronavirus shock and the uncertain trend in passenger demand that
will extend well into 2021.
Downgrades:
Issuer: WestJet Airlines Ltd.
Corporate Family Rating, Downgraded to B3 from Ba3
Probability of Default Rating, Downgraded to B3-PD from Ba3-PD
Gtd Senior Secured First Lien Term Loan, Downgraded to B2 (LGD3)
from Ba2 (LGD3)
Gtd Senior Secured First Lien Revolving Credit Facility, Downgraded
to B2 (LGD3) from Ba2 (LGD3)
Outlook Actions:
Issuer: WestJet Airlines Ltd.
Outlook, Changed to Negative from Rating Under Review
RATINGS RATIONALE
WestJet's (B3 negative) credit benefits from its leading position
in the duopolistic Canadian market, and falling fuel costs. It is
constrained by the severe drop in passenger demand and uncertainty
regarding the length and impact of current market conditions,
higher leverage following WestJet's privatization (3.7x adj.
debt/EBITDA in 2019), event risks of ownership by private equity
and significant pressure on the company's liquidity.
The rating action reflects the almost complete grounding of the
company's fleet in the second quarter of 2020, and the expectation
that passenger's return to air travel is likely to be slow. These
conditions will lead to significant cash consumption in 2020, which
will significantly weaken WestJet's liquidity profile and increase
leverage.
Moody's base case assumptions will be that capacity will be 85/90%
lower in Q2/20 (compared to the previous year) and about 75% in Q3,
with an assumption that it will take at least three years to
recover to 2019 levels of revenue and capacity. WestJet has cut
capacity and initiated a company-wide cost reduction and capital
deferral program to preserve cash. WestJet is currently focusing on
managing its way through this very volatile market environment by
reducing costs as much as possible and by shoring up its liquidity
profile. Domestic air travel will likely recover first, followed by
U.S. transborder travel, while international travel will take
longer. In 2019, about half of the WestJet's passenger revenue
miles were on domestic routes, and the other half on U.S.
transborder and international routes.
The airline sector currently accounts for about 2% of global carbon
emissions with 65% of its emissions coming from international
flights. Canada (and as a result WestJet) is one of the 70
countries that have voluntarily elected to early adopt the
International Civil Aviation Organization's (ICAO) Carbon
Offsetting and Reduction Scheme for International Aviation
(CORSIA), which targets capping carbon emissions at 2020 levels and
requires purchases of offsets for airlines' that exceed their
targets.
WestJet's liquidity is comprised of CAD1.6 billion of cash and
short-term investments including a fully drawn US $350 million
revolver (due 2024). These sources are sufficient to fund its
expectation at this time of CAD1.2 billion of negative free cash
flow, and its mandatory annual debt and lease repayments in 2020.
Moody's negative free cash flow estimate does not include WestJet
Airlines' expectation of completing sale and operating leaseback
transactions for its future aircraft deliveries, or existing
aircraft which if completed, will provide additional liquidity.
WestJet's term loan and credit facility are secured by the majority
of its assets, and subject to a collateral coverage test where the
company is currently well above the minimum requirement. This
provides WestJet the flexibility to use some of the collateral
above the minimum requirement to raise liquidity if needed.
The negative outlook reflects the risk of more challenging downside
scenarios and that the timing of passenger's return to air travel
is uncertain and could be slower than Moody's currently expects.
The negative outlook also reflects the expected cash burn of
WestJet and potential that liquidity usage could be in excess of
expectations.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if Moody's believes the impacts of
the coronavirus will lead to a steeper and longer decline in
passenger demand and weaker credit metrics. This includes if there
are clear expectations that WestJet will not be able to timely
restore its financial profile once the virus recedes, including if
debt-to-EBITDA is sustained above 6.5x or funds from operations
plus interest is sustained below 1.5x.
There will be no upwards pressure on ratings until passenger demand
begins to return, and key credit metrics improve, with
debt-to-EBITDA towards 5x and funds from operations plus
interest-to-interest of about 5x.
The principal methodology used in these ratings was Passenger
Airline Industry published in April 2018.
WestJet Airlines Ltd. headquartered in Calgary, Alberta, is a
private company owned by Onex Corporation, and is the
second-largest Canadian air carrier, providing scheduled passenger
services to over 100 destinations in Canada, the US, Central
America, the Caribbean and Europe. Revenue for 2019 was CAD 5.1
billion.
WILLIAM E. ROBINSON: Baxter Buying Mansfield Property for $15K
--------------------------------------------------------------
William E. Robinson asks the U.S. Bankruptcy Court for the Middle
District of Pennsylvania to authorize the sale of the real property
located at and known as 16065 Rt. 6, Mansfield, Tioga County,
Pennsylvania to Lori K. Baxter for $15,000, subject to various
costs of sale, free and clear of all liens, claims, encumbrances,
and other interests.
The Debtor owns various parcels of real estate in Tioga and
Washington Counties, Pennsylvania. Included in such real estate is
an interest the Real Property.
The Debtor has entered into has entered into an agreement of sale
with the Buyer of the Real Property. The Buyer is the ex-wife of
the Debtor. The Agreement sets forth, in part, that the total
consideration payable by the Buyer is $15,000, subject to various
costs of sale.
The Real Property was listed on the Schedules at a value of
$150,000, however, the Real Property has deteriorated since such
time. The condition of the Real Property is that all buildings
located on the parcel of Real Property need to be demolished and
are falling apart.
Further, the Real Property does not have sewer services provided to
it. In order for sewer services to be accessed would be to gain an
easement to the adjourning property. The adjoining property is
owned by the Buyer, and the Buyer may be the only user of the Real
Property. It is believed that the consideration payable under the
Agreement is fair and reasonable and is believed to be the best
price obtainable for the Real Property. The Debtor had a Certified
Market Analysis performed and the value of the Real Property is
listed thereon as being between $15,000 and $17,000.
The following judgments may constitute liens against the Debtor's
interest in the Real Property: Tax lien in favor of the Internal
Revenue Service entered on September 30, 2015, in the Court of
Common Pleas of Tioga County, in the original amount of
$1,436,767.
The Debtor's Plan and the Confirmation Order caused a release of
various judgments and liens, which are believed to include the
following:
a. Judgment lien in favor of Fulton National Bank ("FNB")
entered on March 7, 2016, in the Court of Common Pleas of Tioga
County, in the amount of $153,516.
b. Judgment lien in favor of FNB entered on March 7, 2016, in
the Court of Common Pleas of Tioga County, in the amount of
$223,001.
c. Judgment lien in favor of FNB entered on Jan. 30, 2017, in
the Court of Common Pleas of Tioga County, in the amount of
$784,210.
d. Judgment lien in favor of FNB entered on Jan. 30, 2017, in
the Court of Common Pleas of Tioga County, in the amount of
$149,512.
e. Judgment lien in favor of FNB entered on Jan. 30, 2017, in
the Court of Common Pleas of Tioga County, in the amount of
$97,999.
f. Pennsylvania Department of Review liens filed April 6,
2015.
The Real Property may be subject to liens for past due and current
real estate taxes and municipal liens.
Pursuant to the Agreement, the Debtor, as the Seller, will pay
costs and expenses associated with the sale of the Real Property at
closing as follows:
a. Any notarization or incidental filing charges required to
be paid by the Debtor as the Seller.
b. All other costs and charges apportioned to the Debtor as
the Seller;
c. All costs associated with the preparation of the conveyance
instruments and normal services with respect to closing, including
payment of a total of $2,500 payable to the Debtor's counsel,
Cunningham, Chernicoff & Warshawsky, P.C., in connection with
implementation of the sale, the presentation and pursuit of this
Motion, consummation of closing and otherwise approved professional
fees and expenses in connection with the case. The foregoing sums
will be subject to the approval and allowance by the Bankruptcy
Court and will be held by Cunningham, Chernicoff & Warshawsky, P.C.
until such time as the Bankruptcy Court approves the application of
such funds by Cunningham, Chernicoff & Warshawsky, P.C.
d. Past due real estate taxes and present real estate taxes
pro rated to the date of closing on the sale.
e. Any municipal charges and liens, pro rated, to the date of
closing on the sale.
Subsequent to the payment of costs of sale as set forth, the Debtor
proposes to pay the net proceeds to the Internal Revenue Service on
account of the Internal Revenue Service lien set forth.
In the event there is a dispute as to the disposition of the
proceeds net of the aforesaid costs of sale, Debtor requests
approval of the sale with any disputed proceeds to be held in trust
by the Debtor's counsel. The consideration for the Debtor's
interest in the Real Property is fair and reasonable and is
believed to be equivalent to the fair market value thereof. Thus,
the sale is in the Debtor's and its estate's best interests.
The Buyer is not currently related in any way to the Debtor or to
any affiliates of the Debtor. The Buyer was formerly related to
the Debtor, as the Buyer is the ex-wife of the Debtor. The
proposed transaction does not contemplate any breakup fee or any
other subparts of Local Rule 6004-4.
The Debtor asks that any order approving the sale transaction be
effective immediately by declaring inapplicable the 14-day stay
provided in Bankruptcy Rules 6004(h) and 6006(d).
A copy of the Agreement is available at https://tinyurl.com/y9alr5n
from PacerMonitor.com free of charge.
William E. Robinson sought Chapter 11 protection (Bankr. M.D. Pa.
Case No. 17-04408) on Oct. 23, 2017. The Debtor tapped Robert E.
Chernicoff, Esq., at Cunningham and Chernicoff PC as counsel.
[*] Judge Aleta Trauger to Get 2020 American Inns of Court Award
----------------------------------------------------------------
Judge Aleta A. Trauger has been selected to receive the prestigious
2020 American Inns of Court Professionalism Award for the Sixth
Circuit. Since 1998, she has served as a U.S. district judge in
the Middle District of Tennessee.
"Judge Trauger has demonstrated extraordinary industry, character,
and intellect in every position she has held in her distinguished
career," say Chief Judge Waverly D. Crenshaw Jr. and other
colleagues, who nominated Trauger for the award. "Even more
remarkable is the fact that, throughout her career, she has been
the first or one of the first women to hold each position." It is
fitting, they note, that Judge Trauger became the first woman in
the Sixth Circuit to receive this award as the Nineteenth Amendment
celebrates the hundredth anniversary of its ratification in
Tennessee.
Before becoming the Middle District's first female judge, Judge
Trauger was the first woman U.S. bankruptcy judge for the Middle
District. Earlier, Judge Trauger served as the first woman chief
of staff to Nashville's mayor, a partner at the Nashville firm
Gilbert Frank & Milom/Wyatt Tarrant & Combs, and in-house legal
counsel for the College of Charleston. She also served as an
assistant U.S. attorney in Illinois and Tennessee. In the latter
role, she helped lead the prosecution of Tennessee Governor Ray
Blanton for extortion and other crimes, a victory that won Judge
Trauger a 1981 Special Achievement Award from the U.S. Department
of Justice. Even before she was admitted to the bar, Judge Trauger
received special dispensation to appear on behalf of the plaintiffs
in a lawsuit brought to desegregate Tennessee's higher education
system, litigation she returned to while in private practice.
Judge Trauger was a founding member of the Tennessee Lawyers'
Association for Women and served as its second president. "At a
time when women were still relatively new to the bar in Tennessee,
she was able to use her formidable skills to pave the way for other
women in the legal community," says Kim Looney, Esquire, the
current president. Judge Trauger was also a founder and second
president of Nashville's Lawyers' Association for Women. She is a
long-time member of the National Association of Women Judges and a
Master of the Bench member of the Harry Phillips American Inn of
Court.
Judge Trauger received her undergraduate degree from Cornell
College in 1968 and her law degree from Vanderbilt University Law
School in 1976.
The American Inns of Court, headquartered in Alexandria, Virginia,
inspires the legal community to advance the rule of law by
achieving the highest level of professionalism through example,
education, and mentoring. The organization's membership includes
nearly 30,000 federal, state, and local judges; lawyers; law
professors; and law students in nearly 370 chapters nationwide.
[^] BOND PRICING: For the Week from May 25 to 29, 2020
------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
24 Hour Fitness Worldwide HRFITW 8.000 2.828 6/1/2022
24 Hour Fitness Worldwide HRFITW 8.000 2.773 6/1/2022
AMC Entertainment Holdings AMC 5.750 27.306 6/15/2025
Ahern Rentals Inc AHEREN 7.375 39.639 5/15/2023
Ahern Rentals Inc AHEREN 7.375 33.584 5/15/2023
Ally Financial Inc ALLY 3.000 98.480 6/15/2020
America West Airlines
2001-1 Pass
Through Trust AAL 7.100 79.000 4/2/2021
American Airlines 2011-1
Class A Pass
Through Trust AAL 5.250 81.054 1/31/2021
American Airlines 2013-1
Class B Pass
Through Trust AAL 5.625 84.000 1/15/2021
American Airlines 2013-2
Class B Pass
Through Trust AAL 5.600 95.019 7/15/2020
American Energy- Permian
Basin LLC AMEPER 12.000 11.515 10/1/2024
American Energy- Permian
Basin LLC AMEPER 12.000 11.505 10/1/2024
American Energy- Permian
Basin LLC AMEPER 12.000 11.505 10/1/2024
Avid Technology Inc AVID 2.000 98.658 6/15/2020
BPZ Resources Inc BPZR 6.500 3.017 3/1/2049
Basic Energy Services Inc BASX 10.750 42.039 10/15/2023
Basic Energy Services Inc BASX 10.750 42.039 10/15/2023
Beverages & More Inc BEVMO 11.500 64.102 6/15/2022
Beverages & More Inc BEVMO 11.500 63.934 6/15/2022
Bon-Ton Department Stores BONT 8.000 9.400 6/15/2021
Briggs & Stratton Corp BGG 6.875 33.919 12/15/2020
Bristow Group Inc BRS 6.250 5.831 10/15/2022
Bristow Group Inc BRS 4.500 5.875 6/1/2023
British Airways 2013-1
Class B Pass
Through Trust IAGLN 5.625 97.879 6/20/2020
British Airways 2013-1
Class B Pass
Through Trust IAGLN 5.625 97.879 6/20/2020
Bruin E&P Partners LLC BRUINE 8.875 1.072 8/1/2023
Bruin E&P Partners LLC BRUINE 8.875 1.128 8/1/2023
Buffalo Thunder
Development Authority BUFLO 11.000 50.125 12/9/2022
CBL & Associates LP CBL 5.250 28.750 12/1/2023
CBL & Associates LP CBL 4.600 24.204 10/15/2024
CEC Entertainment Inc CEC 8.000 9.208 2/15/2022
CSI Compressco LP / CSI
Compressco Finance Inc CCLP 7.250 37.148 8/15/2022
Calfrac Holdings LP CFWCN 10.875 21.632 3/15/2026
Calfrac Holdings LP CFWCN 8.500 4.448 6/15/2026
Calfrac Holdings LP CFWCN 10.875 21.632 3/15/2026
Calfrac Holdings LP CFWCN 8.500 4.562 6/15/2026
California Resources Corp CRC 8.000 1.184 12/15/2022
California Resources Corp CRC 8.000 1.204 12/15/2022
California Resources Corp CRC 6.000 1.467 11/15/2024
California Resources Corp CRC 5.500 1.416 9/15/2021
California Resources Corp CRC 6.000 2.635 11/15/2024
Callon Petroleum Co CPE 6.250 32.552 4/15/2023
Callon Petroleum Co CPE 6.125 32.162 10/1/2024
Callon Petroleum Co CPE 8.250 30.394 7/15/2025
Callon Petroleum Co CPE 6.125 29.258 10/1/2024
Callon Petroleum Co CPE 6.125 29.258 10/1/2024
Capital One Financial Corp COF 5.550 81.250 N/A
Chaparral Energy Inc CHAP 8.750 11.258 7/15/2023
Chaparral Energy Inc CHAP 8.750 9.687 7/15/2023
Chesapeake Energy Corp CHK 11.500 6.000 1/1/2025
Chesapeake Energy Corp CHK 11.500 6.736 1/1/2025
Chesapeake Energy Corp CHK 5.500 2.500 9/15/2026
Chesapeake Energy Corp CHK 8.000 2.561 6/15/2027
Chesapeake Energy Corp CHK 4.875 3.542 4/15/2022
Chesapeake Energy Corp CHK 5.750 3.091 3/15/2023
Chesapeake Energy Corp CHK 7.000 2.500 10/1/2024
Chesapeake Energy Corp CHK 8.000 2.272 1/15/2025
Chesapeake Energy Corp CHK 8.000 2.000 3/15/2026
Chesapeake Energy Corp CHK 7.500 2.559 10/1/2026
Chesapeake Energy Corp CHK 8.000 2.057 6/15/2027
Chesapeake Energy Corp CHK 8.000 1.759 3/15/2026
Chesapeake Energy Corp CHK 8.000 2.057 6/15/2027
Chesapeake Energy Corp CHK 8.000 2.077 1/15/2025
Chesapeake Energy Corp CHK 8.000 1.759 3/15/2026
Chesapeake Energy Corp CHK 8.000 2.077 1/15/2025
Citigroup Inc C 5.950 92.143 N/A
Clearway Energy Inc CWENA 3.250 99.250 6/1/2020
CorEnergy Infrastructure
Trust Inc CORR 7.000 80.000 6/15/2020
Dean Foods Co DF 6.500 3.950 3/15/2023
Dean Foods Co DF 6.500 3.572 3/15/2023
Denbury Resources Inc DNR 9.000 42.344 5/15/2021
Denbury Resources Inc DNR 9.250 42.410 3/31/2022
Denbury Resources Inc DNR 7.750 41.344 2/15/2024
Denbury Resources Inc DNR 5.500 5.325 5/1/2022
Denbury Resources Inc DNR 4.625 3.639 7/15/2023
Denbury Resources Inc DNR 6.375 4.500 12/31/2024
Denbury Resources Inc DNR 6.375 4.857 8/15/2021
Denbury Resources Inc DNR 9.000 42.740 5/15/2021
Denbury Resources Inc DNR 9.250 42.271 3/31/2022
Denbury Resources Inc DNR 7.500 24.000 2/15/2024
Denbury Resources Inc DNR 7.750 41.391 2/15/2024
Denbury Resources Inc DNR 7.500 40.000 2/15/2024
Diamond Offshore Drilling DOFSQ 7.875 11.375 8/15/2025
Diamond Offshore Drilling DOFSQ 5.700 11.625 10/15/2039
Diamond Offshore Drilling DOFSQ 3.450 11.313 11/1/2023
ENSCO International Inc VAL 7.200 10.530 11/15/2027
EP Energy LLC / Everest
Acquisition Finance Inc EPENEG 7.750 12.750 5/15/2026
EP Energy LLC / Everest
Acquisition Finance Inc EPENEG 8.000 1.500 11/29/2024
EP Energy LLC / Everest
Acquisition Finance Inc EPENEG 9.375 1.192 5/1/2024
EP Energy LLC / Everest
Acquisition Finance Inc EPENEG 7.750 12.481 5/15/2026
EP Energy LLC / Everest
Acquisition Finance Inc EPENEG 9.375 1.192 5/1/2024
EP Energy LLC / Everest
Acquisition Finance Inc EPENEG 8.000 1.175 11/29/2024
EnLink Midstream Partners ENLK 6.000 28.000 N/A
Energy Conversion Devices ENER 3.000 7.875 6/15/2013
Energy Future Competitive
Holdings Co LLC TXU 1.144 0.072 1/30/2037
Exantas Capital Corp XAN 4.500 45.500 8/15/2022
Exela Intermediate LLC /
Exela Finance Inc EXLINT 10.000 17.091 7/15/2023
Exela Intermediate LLC /
Exela Finance Inc EXLINT 10.000 16.782 7/15/2023
Extraction Oil & Gas Inc XOG 7.375 6.145 5/15/2024
Extraction Oil & Gas Inc XOG 5.625 5.634 2/1/2026
Extraction Oil & Gas Inc XOG 5.625 5.599 2/1/2026
Extraction Oil & Gas Inc XOG 7.375 6.563 5/15/2024
FTS International Inc FTSINT 6.250 25.708 5/1/2022
Federal Farm Credit Banks
Funding Corp FFCB 2.000 99.507 6/2/2027
Federal Farm Credit Banks
Funding Corp FFCB 2.290 99.302 12/2/2030
Federal Farm Credit Banks
Funding Corp FFCB 1.720 99.515 9/5/2025
Federal Farm Credit Banks
Funding Corp FFCB 1.700 99.359 9/3/2024
Federal Home Loan Banks FHLB 2.890 99.610 8/9/2041
Federal Home Loan Banks FHLB 2.720 97.438 9/2/2036
Federal Home Loan Banks FHLB 1.550 99.465 12/5/2023
Federal Home Loan Mortgage FHLMC 1.875 99.349 3/5/2025
Federal Home Loan Mortgage FHLMC 1.820 99.323 12/1/2021
Federal National
Mortgage Association FNMA 1.400 99.446 6/5/2020
Fenix Marine Service
Holdings Ltd NOLSP 8.000 40.043 1/15/2024
Fleetwood Enterprises Inc FLTW 14.000 3.557 12/15/2011
Ford Motor Credit Co LLC F 2.200 97.969 6/20/2020
Forum Energy Technologies FET 6.250 40.078 10/1/2021
Frontier Communications FTR 11.000 35.250 9/15/2025
Frontier Communications FTR 10.500 34.750 9/15/2022
Frontier Communications FTR 8.750 33.000 4/15/2022
Frontier Communications FTR 7.125 31.250 1/15/2023
Frontier Communications FTR 6.250 30.750 9/15/2021
Frontier Communications FTR 6.875 31.500 1/15/2025
Frontier Communications FTR 7.625 30.063 4/15/2024
Frontier Communications FTR 9.250 31.500 7/1/2021
Frontier Communications FTR 8.875 28.500 9/15/2020
Frontier Communications FTR 11.000 29.500 9/15/2025
Frontier Communications FTR 10.500 34.436 9/15/2022
Frontier Communications FTR 10.500 30.875 9/15/2022
Frontier Communications FTR 11.000 35.174 9/15/2025
GameStop Corp GME 6.750 76.320 3/15/2021
GameStop Corp GME 6.750 76.734 3/15/2021
General Electric Co GE 5.000 78.000 N/A
Global Eagle Entertainment ENT 2.750 6.208 2/15/2035
Gogo Inc GOGO 6.000 54.500 5/15/2022
Goodman Networks Inc GOODNT 8.000 41.629 5/11/2022
Great Western Bancorp Inc GWB 4.875 93.424 8/15/2025
Great Western Petroleum
LLC / Great Western
Finance Corp GRTWST 9.000 62.750 9/30/2021
Great Western Petroleum
LLC / Great Western
Finance Corp GRTWST 9.000 62.781 9/30/2021
Grizzly Energy LLC VNR 9.000 6.000 2/15/2024
Grizzly Energy LLC VNR 9.000 6.000 2/15/2024
Hertz Corp/The HTZ 6.000 16.935 1/15/2028
Hertz Corp/The HTZ 5.500 16.084 10/15/2024
Hertz Corp/The HTZ 7.625 44.163 6/1/2022
Hertz Corp/The HTZ 7.625 45.119 6/1/2022
Hertz Corp/The HTZ 5.500 17.134 10/15/2024
Hertz Corp/The HTZ 7.125 16.990 8/1/2026
Hertz Corp/The HTZ 6.000 16.936 1/15/2028
Hertz Corp/The HTZ 7.000 18.427 1/15/2028
Hertz Corp/The HTZ 7.125 16.103 8/1/2026
Hertz Corp/The HTZ 6.250 17.337 10/15/2022
Hi-Crush Inc HCR 9.500 1.136 8/1/2026
Hi-Crush Inc HCR 9.500 7.287 8/1/2026
High Ridge Brands Co HIRIDG 8.875 5.125 3/15/2025
High Ridge Brands Co HIRIDG 8.875 5.125 3/15/2025
HighPoint Operating Corp HPR 7.000 28.685 10/15/2022
HighPoint Operating Corp HPR 8.750 24.967 6/15/2025
Hornbeck Offshore Services HOSS 5.875 36.000 4/1/2020
International Wire Group ITWG 10.750 75.000 8/1/2021
International Wire Group ITWG 10.750 76.417 8/1/2021
J Crew Brand LLC /
J Crew Brand Corp JCREWB 13.000 50.500 9/15/2021
JAKKS Pacific Inc JAKK 4.875 99.625 6/1/2020
JC Penney Corp Inc JCP 5.875 35.317 7/1/2023
JC Penney Corp Inc JCP 7.625 1.426 3/1/2097
JC Penney Corp Inc JCP 6.375 2.492 10/15/2036
JC Penney Corp Inc JCP 7.400 1.493 4/1/2037
JC Penney Corp Inc JCP 8.625 8.237 3/15/2025
JC Penney Corp Inc JCP 5.875 35.073 7/1/2023
JC Penney Corp Inc JCP 7.125 1.392 11/15/2023
JC Penney Corp Inc JCP 8.625 7.497 3/15/2025
JC Penney Corp Inc JCP 6.900 1.740 8/15/2026
Jonah Energy LLC / Jonah
Energy Finance Corp JONAHE 7.250 6.946 10/15/2025
Jonah Energy LLC / Jonah
Energy Finance Corp JONAHE 7.250 6.809 10/15/2025
K Hovnanian Enterprises HOV 10.000 49.500 7/15/2022
K Hovnanian Enterprises HOV 10.500 41.000 7/15/2024
K Hovnanian Enterprises HOV 5.000 10.059 2/1/2040
K Hovnanian Enterprises HOV 10.000 67.500 7/15/2022
K Hovnanian Enterprises HOV 10.500 40.725 7/15/2024
K Hovnanian Enterprises HOV 10.000 33.875 11/15/2025
K Hovnanian Enterprises HOV 5.000 10.059 2/1/2040
KLX Energy Services
Holdings Inc KLXE 11.500 34.269 11/1/2025
KLX Energy Services
Holdings Inc KLXE 11.500 34.618 11/1/2025
KLX Energy Services
Holdings Inc KLXE 11.500 35.410 11/1/2025
Kraft Heinz Foods Co KHC 3.375 102.799 6/15/2021
LSC Communications Inc LKSD 8.750 9.660 10/15/2023
LSC Communications Inc LKSD 8.750 9.375 10/15/2023
Lexicon Pharmaceuticals LXRX 5.250 57.177 12/1/2021
Liberty Media Corp LMCA 2.250 49.188 9/30/2046
Lonestar Resources America LONE 11.250 7.138 1/1/2023
Lonestar Resources America LONE 11.250 5.097 1/1/2023
MAI Holdings Inc MAIHLD 9.500 20.000 6/1/2023
MAI Holdings Inc MAIHLD 9.500 20.000 6/1/2023
MAI Holdings Inc MAIHLD 9.500 20.000 6/1/2023
MF Global Holdings Ltd MF 9.000 15.625 6/20/2038
MF Global Holdings Ltd MF 6.750 15.625 8/8/2016
Martin Midstream Partners
LP / Martin Midstream
Finance Corp MMLP 7.250 58.094 2/15/2021
Martin Midstream Partners
LP / Martin Midstream
Finance Corp MMLP 7.250 58.709 2/15/2021
Martin Midstream Partners
LP / Martin Midstream
Finance Corp MMLP 7.250 58.709 2/15/2021
Mashantucket Western
Pequot Tribe MASHTU 7.350 16.000 7/1/2026
McClatchy Co/The MNIQQ 6.875 2.418 3/15/2029
McClatchy Co/The MNIQQ 6.875 2.046 7/15/2031
McClatchy Co/The MNIQQ 7.150 1.772 11/1/2027
McDermott Technology
Americas Inc / McDermott
Technology US Inc MDR 10.625 5.019 5/1/2024
McDermott Technology
Americas Inc / McDermott
Technology US Inc MDR 10.625 4.762 5/1/2024
Men's Wearhouse Inc/The TLRD 7.000 27.148 7/1/2022
Men's Wearhouse Inc/The TLRD 7.000 26.596 7/1/2022
MetLife Inc MET 5.250 89.500 N/A
Morgan Stanley MS 5.550 89.097 N/A
Morgan Stanley MS 1.440 98.384 6/17/2020
Murray Energy Corp MURREN 12.000 0.001 4/15/2024
Murray Energy Corp MURREN 12.000 0.593 4/15/2024
NWH Escrow Corp HARDWD 7.500 51.902 8/1/2021
NWH Escrow Corp HARDWD 7.500 51.902 8/1/2021
Nabors Industries Inc NBR 5.750 31.162 2/1/2025
Nabors Industries Inc NBR 4.625 67.988 9/15/2021
Nabors Industries Inc NBR 5.100 35.172 9/15/2023
Nabors Industries Inc NBR 5.500 34.815 1/15/2023
Nabors Industries Inc NBR 0.750 19.500 1/15/2024
Nabors Industries Inc NBR 5.750 31.287 2/1/2025
Nabors Industries Inc NBR 5.750 31.352 2/1/2025
Neiman Marcus Group LLC NMG 7.125 4.500 6/1/2028
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.000 3.000 10/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 14.000 26.000 4/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.750 3.000 10/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.000 3.973 10/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 14.000 23.741 4/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.750 33.500 10/25/2024
Neiman Marcus Group Ltd NMG 8.000 54.000 10/15/2021
Neiman Marcus Group Ltd NMG 8.000 53.875 10/15/2021
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.250 3.876 5/15/2019
Nine Energy Service Inc NINE 8.750 38.327 11/1/2023
Nine Energy Service Inc NINE 8.750 38.177 11/1/2023
Nine Energy Service Inc NINE 8.750 38.546 11/1/2023
Northwest Hardwoods Inc HARDWD 7.500 34.647 8/1/2021
Northwest Hardwoods Inc HARDWD 7.500 34.647 8/1/2021
OMX Timber Finance
Investments II LLC OMX 5.540 0.573 1/29/2020
Oasis Petroleum Inc OAS 6.875 18.138 3/15/2022
Oasis Petroleum Inc OAS 6.875 17.349 1/15/2023
Oasis Petroleum Inc OAS 6.250 16.559 5/1/2026
Oasis Petroleum Inc OAS 2.625 10.000 9/15/2023
Oasis Petroleum Inc OAS 6.500 17.566 11/1/2021
Oasis Petroleum Inc OAS 6.250 16.821 5/1/2026
Omnimax International Inc EURAMX 12.000 75.129 8/15/2020
Omnimax International Inc EURAMX 12.000 74.682 8/15/2020
Optimas OE Solutions
Holding LLC / Optimas
OE Solutions Inc OPTOES 8.625 57.279 6/1/2021
Optimas OE Solutions
Holding LLC / Optimas
OE Solutions Inc OPTOES 8.625 57.279 6/1/2021
PDC Energy Inc PDCE 6.250 74.454 12/1/2025
PHH Corp PHH 6.375 57.207 8/15/2021
Party City Holdings Inc PRTY 6.625 15.324 8/1/2026
Party City Holdings Inc PRTY 6.125 15.782 8/15/2023
Party City Holdings Inc PRTY 6.625 10.911 8/1/2026
Party City Holdings Inc PRTY 6.125 10.619 8/15/2023
Pinnacle Bank/Nashville TN PNFP 4.875 100.000 7/30/2025
Pride International LLC VAL 7.875 8.538 8/15/2040
Pyxus International Inc PYX 9.875 10.180 7/15/2021
Pyxus International Inc PYX 9.875 10.467 7/15/2021
Pyxus International Inc PYX 9.875 10.467 7/15/2021
QEP Resources Inc QEP 6.875 71.540 3/1/2021
Quorum Health Corp QHC 11.625 15.496 4/15/2023
Renco Metals Inc RENCO 11.500 24.875 7/1/2003
Revlon Consumer Products REV 5.750 65.574 2/15/2021
Revlon Consumer Products REV 6.250 16.809 8/1/2024
Rolta LLC RLTAIN 10.750 5.937 5/16/2018
SESI LLC SPN 7.125 29.828 12/15/2021
SESI LLC SPN 7.125 41.729 12/15/2021
SESI LLC SPN 7.750 32.545 9/15/2024
Sable Permian Resources
Land LLC / AEPB
Finance Corp AMEPER 7.375 0.932 11/1/2021
Sable Permian Resources
Land LLC / AEPB
Finance Corp AMEPER 7.375 0.932 11/1/2021
SanDisk LLC SNDK 0.500 85.141 10/15/2020
Sanchez Energy Corp SNEC 6.125 0.600 1/15/2023
Sanchez Energy Corp SNEC 7.250 1.000 2/15/2023
Sanchez Energy Corp SNEC 7.250 0.751 2/15/2023
SandRidge Energy Inc SD 7.500 0.500 2/15/2023
Sears Holdings Corp SHLD 8.000 1.175 12/15/2019
Sears Holdings Corp SHLD 6.625 3.897 10/15/2018
Sears Holdings Corp SHLD 6.625 3.897 10/15/2018
Sears Roebuck Acceptance SHLD 7.500 1.000 10/15/2027
Sears Roebuck Acceptance SHLD 6.750 0.762 1/15/2028
Sears Roebuck Acceptance SHLD 7.000 0.816 6/1/2032
Sears Roebuck Acceptance SHLD 6.500 1.000 12/1/2028
Sempra Texas Holdings Corp TXU 5.550 13.500 11/15/2014
Stearns Holdings LLC STELND 9.375 45.375 8/15/2020
Stearns Holdings LLC STELND 9.375 45.375 8/15/2020
Summit Midstream Holdings
LLC / Summit Midstream
Finance Corp SUMMPL 5.500 47.876 8/15/2022
Summit Midstream Partners SMLP 9.500 9.750 N/A
Tapstone Energy LLC /
Tapstone Energy
Finance Corp TAPENE 9.750 0.273 6/1/2022
Tapstone Energy LLC /
Tapstone Energy
Finance Corp TAPENE 9.750 0.273 6/1/2022
Teligent Inc/NJ TLGT 4.750 40.039 5/1/2023
TerraVia Holdings Inc TVIA 5.000 4.644 10/1/2019
TerraVia Holdings Inc TVIA 6.000 4.644 2/1/2018
Tesla Energy Operations TSLAEN 3.600 94.966 6/11/2020
Tesla Energy Operations TSLAEN 3.600 93.858 8/6/2020
Transworld Systems Inc TSIACQ 9.500 24.250 8/15/2021
Transworld Systems Inc TSIACQ 9.500 24.250 8/15/2021
Tupperware Brands Corp TUP 4.750 42.054 6/1/2021
Tupperware Brands Corp TUP 4.750 43.471 6/1/2021
Tupperware Brands Corp TUP 4.750 43.471 6/1/2021
UCI International LLC UCII 8.625 4.780 2/15/2019
Ultra Resources Inc/US UPL 11.000 5.500 7/12/2024
Ultra Resources Inc/US UPL 7.125 0.050 4/15/2025
Ultra Resources Inc/US UPL 7.125 0.617 4/15/2025
Unit Corp UNTUS 6.625 10.604 5/15/2021
Western Asset Mortgage
Capital Corp WMC 6.750 49.000 10/1/2022
Whiting Petroleum Corp WLL 5.750 11.750 3/15/2021
Whiting Petroleum Corp WLL 6.625 12.000 1/15/2026
Whiting Petroleum Corp WLL 6.250 12.500 4/1/2023
Whiting Petroleum Corp WLL 6.625 6.750 1/15/2026
Whiting Petroleum Corp WLL 6.625 11.409 1/15/2026
Windstream Services LLC /
Windstream Finance Corp WIN 10.500 5.625 6/30/2024
Windstream Services LLC /
Windstream Finance Corp WIN 9.000 5.625 6/30/2025
Windstream Services LLC /
Windstream Finance Corp WIN 9.000 5.500 6/30/2025
Windstream Services LLC /
Windstream Finance Corp WIN 6.375 2.500 8/1/2023
Windstream Services LLC /
Windstream Finance Corp WIN 8.750 3.612 12/15/2024
Windstream Services LLC /
Windstream Finance Corp WIN 7.500 2.071 6/1/2022
Windstream Services LLC /
Windstream Finance Corp WIN 6.375 2.496 8/1/2023
Windstream Services LLC /
Windstream Finance Corp WIN 10.500 3.000 6/30/2024
Windstream Services LLC /
Windstream Finance Corp WIN 8.750 3.612 12/15/2024
Windstream Services LLC /
Windstream Finance Corp WIN 7.750 3.339 10/1/2021
rue21 inc RUE 9.000 1.305 10/15/2021
*********
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 ***