/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/200610.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, June 10, 2020, Vol. 24, No. 161 Headlines 24 HOUR FITNESS: S&P Downgrades ICR to 'D' on Missed Payments 3E EIGHT: Voluntary Chapter 11 Case Summary 929485 FLORIDA: Deadline to File Chapter 11 Plan Expires Today ADVANTAGE HOLDCO: Proposes June 24 Auction for All Assets AERO-MARINE: Wobbe Buying Equipment for $30K AHERN RENTALS: Moody's Cuts CFR to 'Caa1', Outlook Negative ALAMO CHANDLER: Alamo Drafthouse Franchisee Files for Chapter 11 ALEXANDER D. BEAVER: Simond Buying Tractor for $20K Cash ANDREW RUGGIERO: Selling Two Arizona Properties for $493K APC AUTOMOTIVE: June 11 Deadline Set for Committee Applications APC AUTOMOTIVE: S&P Downgrades ICR to 'D' on Chapter 11 Proceedings APPLETON HOLDINGS: Sets Bid & Sale Procedures for All Assets ARCHDIOCESE OF NEW ORLEANS: Hires Jones Walker as Counsel ART VAN: Trustee Selling Mattress & Furniture Inventory for $25.7M BODY RENEW: Proposes Sale of Anchorage Exercise Equipment BRIGHT MOUNTAIN: Closes Accretive Acquisition of CL Media Holdings BROADVISION: Emerges from Bankruptcy, Completes Restructuring CALIFORNIA PIZZA: S&P Lowers ICR to 'D' on Missed Interest Payments CALIFORNIA RESOURCES: Signs Forbearance Agreements with Lenders CELADON: Seeks to Publicly Auction its Trucking Businesses CHRISTOPHER S. HARRISON: Selling 1969 Camaro for More than $40K COSTA HOLLYWOOD: Hires Frank Weinberg as Special Counsel COVENANT CHURCH: Case Summary & 2 Unsecured Creditors CUMULUS MEDIA: S&P Alters Outlook to Negative, Affirms 'B-' ICR DISCOVERORG HOLDINGS: S&P Places 'B-' ICR on Watch Positive DM WORLD: Facing Legal Woes, Files for Chapter 11 Bankruptcy DUFF & PHELPS: Moody's Affirms 'B3' CFR, Outlook Remains Stable DURA AUTOMOTIVE: Sold in $65 Million Deal With Bardin Hill FARADAY FUTURE: Founder Bankruptcy Exit to Pave Way for Financing FOODFIRST GLOBAL: Hires Rosenfield and Company as Tax Accountants FREEMAN MOBILE: Files for Chapter 11 Due to High Debt, Pandemic FRONTIER COMMUNICATIONS: Unsecureds to Be Reinstated in Plan GAMESTOP CORP: S&P Rates New Secured Notes 'B-' GRANITE CITY: Selling Two Liquor Licenses for $15K Each H.R.P. II: Amends Sale Agreement to Extend Transport Due Diligence HADDAD RESTAURANT: Landlord Buying Overland Park Assets for $116K HALS REALTY: Seeks to Hire DuBosar Law Group as Special Counsel HALS REALTY: Seeks to Hire GlassRatner as Forensic Accountant HARRIS COUNTY HSA: S&P Affirms BB+ Rating on Jr.-Lien 2001H Bonds HEARTS AND HANDS: June 30 Plan & Disclosure Hearing Set HIDALGO EMERGENCY: Seeks to Extend Exclusivity Period to Aug. 4 HILTON GRAND: S&P Downgrades ICR to 'BB' on Travel Decline IMERYS TALC: Unsecured Creditors to Be Paid in Full in Plan INTERNATIONAL GAME: Moody's Rates New Secured Notes Due 2029 'Ba3' JAMES WINDELL ETHRIDGE: Herpin Buying Land for $41.6K JOHN DAUGHERTY: Committee Hires HooverSlovacek as Counsel KENNETH A. BERDICK: Selling Fort Myers Beach Property for $230K KENNETH A. BERDICK: Selling Interest in Fort Myers Beach Property KLAUSNER LUMBER: Sets Bidding Procedures for All Assets KP ENGINEERING: Reaches Agreement to Resolve Committee Issues L BRANDS: S&P Rates New $750MM Senior Secured Notes 'BB' LA MERCED: OSP to Reply to Mortgage Property Sale Opposition LSC COMMUNICATIONS: Sets Bidding Procedures for All Assets MADAME PAULETTE: Seeks to Hire Morrison Tenenbaum as Counsel MARIA O. MARIA: Hires Cushman & Wakefield Realty as Broker MCL NURSING: July 7 Plan Confirmation Hearing Set MICROCHIP TECHNOLOGY: S&P Rates $1BB 2.67% Sr. Secured Notes 'BB+' MIDTOWN CAMPUS: Seeks to Hire Genovese Joblove as Counsel MIDTOWN CAMPUS: Seeks to Hire KapilaMukamal as Financial Advisor MOOG INC: S&P Alters Outlook to Negative, Affirms 'BB+' ICR NAMB & ASSOCIATES: Hires Warshaw Bursten as Real Estate Counsel OAK LAKE: July 7 Plan Confirmation Hearing Set PARKING MANAGEMENT: Taps JW Infinity as Financial Advisor PARTY CITY: Moody's Cuts Senior Unsec. Notes to Ca, Outlook Neg. PENNSYLVANIA ECONOMIC DEVELOPMENT: S&P Cuts Rev. Bond Rating to B+ PETROCHOICE HOLDING: S&P Affirms 'B-' ICR; Outlook Negative PGX HOLDINGS: S&P Ups ICR to 'CCC+' on Revised Credit Agreement PLAINS ALL: Moody's Rates New Senior Unsecured Notes 'Ba1' PROLINE CONCRETE: U.S. Trustee Objects to Plan Disclosures QEP RESOURCES: Moody's Cuts Rating on Sr. Unsecured Notes to B3 QUEENS BALLPARK: S&P Cuts Bond Ratings to 'BB+' RAINIER PROPERTIES: Case Summary & Unsecured Creditors RAVN AIR: Auction of Substantially All Assets Approved REALOGY GROUP: Moody's Rates Secured 2nd Lien Notes Due 2025 'B3' REGIONAL VALVE: Case Summary & 12 Unsecured Creditors REVLON INC: S&P Ugrades ICR to 'CCC-' on Refinancing Transaction ROBERT KELLY MCLEAN: Selling Fairfield Property for $790K ROBETR S. HELLYER: Oak Groce Offers $15K for Hancock Property ROYAL CARIBBEAN: S&P Places 'BB' ICR on CreditWatch Negative SCHAEFER AMBULANCE: Plan of Reorganization Confirmed by Judge SENIOR PRO: Hires Robert E. Nuddleman as Special Counsel SHEPPARD AND SON: Massey Buying Cordele Property for $7.5K SIRIUS XM: Moody's Rates New $1BB Unsecured Notes Due 2030 'Ba3' SM-T.E.H. REALTY 4: Sale of All Assets to Forkzilla Approved STABLELIFT OF TEXAS: Seeks to Hire Frank B. Lyon as Counsel SUNTECH DRIVE: Case Summary & 20 Largest Unsecured Creditors SURGERY CENTER: Moody's Confirms Caa1 CFR, Outlook Stable SYNCREON INTERMEDIATE: S&P Affirms 'CCC+' ICR; Outlook Stable TANGO DELTA: Seeks Approval to Hire Cole & Cole as Counsel TEMPLAR ENERGY: June 10 Deadline Set for Committee Applications THEE TREE HOUSE: Has Until June 10 to File Plan & Disclosures TIDEWATER ESTATES: Voluntary Chapter 11 Case Summary TNTMD PA: June 24 Plan & Disclosure Hearing Set UNIVISION COMMUNICATIONS: S&P Rates New Senior Secured Notes 'B' UTZ QUALITY: Moody's Hikes CFR to B1 & Alters Outlook to Positive WESTERN DIGITAL: S&P Alters Outlook to Stable, Affirms 'BB+' ICR ********* 24 HOUR FITNESS: S&P Downgrades ICR to 'D' on Missed Payments ------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based fitness club operator 24 Hour Fitness Worldwide Inc. to 'D' from 'CCC+' after the company did not pay its June 1 interest payment on its senior notes due 2022. "We are lowering our issue-level rating on the company's senior unsecured notes to 'D' because we believe the company is unlikely to make the notes interest payment within the 30-day grace period. We are also lowering our issue-level ratings on the company's senior secured term loan and revolver to 'CCC-' from 'B-' to reflect our belief it is unlikely the company will make its upcoming interest payments on this debt," S&P said. 24 Hour Fitness did not pay its June 1 interest payment on its senior notes due 2022 and has entered into a 30-day grace period with its lenders. S&P lowered the issuer credit rating to 'D' because it believes the company will fail to pay its debt service obligations as they come due. S&P believes that COVID-19-related fitness club closures have materially impaired the company's liquidity position. In addition, there are credible press reports the company is seeking a debt restructuring or Chapter 11 bankruptcy filing. While the company is current on its senior secured term loan and revolver, substantial doubt exists whether the company will make its interest and amortization payments on these facilities, due on June 30 and July 17, respectively." Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety factors 3E EIGHT: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: 3E Eight, LLC 244 NE 85th St. Miami, FL 33138-3065 Business Description: 3E Eight, LLC is a privately held company with its principal assets located at 244 NE 85th St El Portal, FL 33138-3065. The Company previously sought bankruptcy protection on April 22, 2020 (Bankr. S.D. Fla. Case No. 20-14586). Chapter 11 Petition Date: June 9, 2020 Court: United States Bankruptcy Court Southern District of Florida Case No.: 20-16260 Judge: Hon. Jay A. Cristol Debtor's Counsel: Elias Leonard. Dsouza, Esq. ELIAS LEONARD DSOUZA, PA 8751 W Broward Blvd Ste 301 Plantation, FL 33324-2632 Tel: (954) 358-5911 E-mail: dtdlaw@aol.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Thuc Mai Kathy Elo, mgrm. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/4VYRaC 929485 FLORIDA: Deadline to File Chapter 11 Plan Expires Today -------------------------------------------------------------- 929485 Florida, Inc. has until today to file its Chapter 11 plan and disclosure statement, according to an order signed by Judge Caryl Delano of the U.S. Bankruptcy Court for the Middle District of Florida. The company's exclusivity period will also expire today. Just recently, the court extended the exclusivity period and allowed the company until June 5 to file its plan and disclosure statement. While 929485 Florida is prepared to file the proposed plan, the company and the proposed buyer were negotiating some additional changes as set-out in the buyer's recent addendum to the sales contract. In order to make sure the terms of the contract are correct and accurate, and that the agreement is properly executed, the company needed a brief additional time to finalize those recent provisions, according to court filings. About 929485 Florida 929485 Florida, Inc., classifies its business as single asset real estate (as defined in 11 U.S.C. Section 101(51B)). 929485 Florida sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-09424) on Oct. 3, 2019. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge Caryl E. Delano oversees the case. Debtor is represented by Edmund S. Whitson, III, Esq., at Adams and Reese, LLP. ADVANTAGE HOLDCO: Proposes June 24 Auction for All Assets --------------------------------------------------------- Judge John T. Dorsey of the U.S. Bankruptcy Court for the District of Delaware will convene a hearing on June 9, 2020 at 1:00 p.m. (ET) to consider Advantage Holdco, Inc. and affiliates' proposed bidding procedures in connection with the auction sale of substantially all their assets. The objection deadline is June 8, 2020 at 4:00 p.m. (ET). The salient terms of the proposed Bidding Procedures are: a. Bid Deadline: No later than June 22, 2020 b. Initial Bid: Each Bid must clearly set forth the purchase price to be paid for the Assets, including and identifying separately any cash and non-cash components. c. Deposit: $100,000 d. Auction: The Auction will be conducted at the offices of Cole Schotz P.C., 500 Delaware Avenue, Suite 1410, Wilmington, Delaware, or by videoconference or teleconference, at 11:00 a.m. (ET) on June 24, 2020 , or such other place and time as the Debtors will notify all Qualified Bidders who have submitted Qualified Bids. e. Bid Increments: Any Bid made at the Auction, if any, by a Qualified Bidder subsequent to the Debtors' announcement of the Opening Bid(s) is an overbid. f. Sale Hearing: No later than June 26, 2020 g. Sale Objection Deadline: June 25, 2020 Each Bid must clearly state the liabilities and obligations of the Debtors that the Qualified Bidder is agreeing to assume, including how such Potential Bidder will address cure amounts and replacement of collateral. At the Auction, if any, a Qualified Bidder who has a valid and perfected lien on any Assets of the Debtors' estates may submit a credit bid for all or a portion of the Assets, subject to such lien, up to the amount of such Secured Creditor's claims to the extent permitted under section 363(k) of the Bankruptcy Code. The Debtors will serve a copy of the Order on the Notice Parties within two days. A copy of the Bidding Procedures is available at https://tinyurl.com/yagpunj5 from PacerMonitor.com free of charge. About Advantage Rent a Carn Advantage Rent A Car -- http://www.advantage.com/-- is a car rental company with 50 locations in the U.S. and 130 international affiliate locations. The parent entity, Advantage Holdco, is owned by Toronto-based Catalyst Capital Group. Advantage has locations in 27 markets, including New York, Los Angeles, Orlando, Las Vegas and Hawaii, according to its website. Advantage Holdco, Inc., doing business as Advantage Rent a Car, sought Chapter 11 protection (Bankr. D. Del. Case No. 20-11259) on May 26, 2020. Six related entities also sought bankruptcy protection. The Hon. John T. Dorsey is the case judge. Advantage was estimated to have $100 million to $500 million in assets and $500 million to $1 billion in liabilities as of the bankruptcy filing. The Debtors tapped COLE SCHOTZ P.C. as counsel; and MACKINAC PARTNERS, LLC, as restructuring advisor. AERO-MARINE: Wobbe Buying Equipment for $30K -------------------------------------------- Joseph N. Vaughn and Theresa L. Vaughn, affiliates of Aero-Marine Technologies, Inc., ask the U.S. Bankruptcy Court for Middle District of Florida to authorize the sale of a Spectre Catamaran, HIN SSS36301E001, custom boat trailer, and related equipment to Neil Wobbe for $30,000. The Debtors determined that it would be in the best interests of creditors and the estate to maximize value through a sale of the Boat under Section 363 of the Bankruptcy Code. The Boat is a customized, open cockpit race boat that includes high performance custom race modifications installed. Open cockpit configurations are no longer permitted to race due to safety concerns. As such, the Boat is not suitable for sale in the general recreation market, and its general value is significantly decreased. Decommissioning of the race equipment will take approximately 30 days at an estimated cost between $5,000 and $10,000. Before the Petition Date, the Debtors hired a broker and marketed the Boat and related equipment for sale privately. After the Petition Date, the Debtors continued to market the Boat to interested parties. The Debtors shown the Boat to several interested parties before and after the Petition Date. The Debtor and the Purchaser entered into an Agreement for Purchase and Sale of Equipment, which provides for the sale by the Debtor, and the purchase by the Purchaser, of the Boat, for a price in the amount of $30,000. There will not be a commission required as part of the sale. The Purchaser is not an insider or otherwise related to the Debtor. The Debtors ask the entry of an order authorizing the sale of the Equipment to the Purchaser, free and clear of any and all Encumbrances. The Encumbrances of any creditors or claimants of any kind whatsoever will attach to the sale proceeds. At the hearing on the Motion, the Debtors will ask that the Court enters an order waiving the 14-day stay set forth in Bankruptcy Rule 6004(g) and providing that the order granting the Motion be immediately enforceable and that the closing under the Purchase Agreement may occur immediately. About Aero-Marine Technologies Aero-Marine Technologies, Inc. -- https://www.aero-marinetechnologies.com/ -- provides total support for waste and water system components found on Boeing, Airbus and Embraer aircraft. Aero-Marine Technologies is a full-service Maintenance, repair and overhaul (MRO) with a worldwide customer base. Aero-Marine Technologies sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-07547) on Aug. 9, 2019. The Debtor's case is jointly administered to that of Joseph N. Vaughn and Theresa L. Vaughn. In the petition signed by Joseph N. Vaughn, president, Aero-Marine's assets are estimated at $500,000 to $1 million, and its liabilities at $1 million to $10 million. The Hon. Caryl E. Delano is the case judge. Stitchler, Riedel, Blain & Postler, P.A., is the Debtor's legal counsel. AHERN RENTALS: Moody's Cuts CFR to 'Caa1', Outlook Negative ----------------------------------------------------------- Moody's Investors Service downgraded the ratings of Ahern Rentals Inc. including the company's corporate family rating to Caa1 from B3, probability of default rating to Caa1-PD from B3-PD, and senior secured second lien notes rating to Caa2 from Caa1. The outlook is negative. This rating action concludes the review for downgrade initiated on March 25, 2020. RATINGS RATIONALE "The downgrade of Ahern's ratings reflects Moody's view that the company's liquidity is weak, while at the same time equipment utilization is under pressure and the business outlook is highly uncertain. Absent sustained improvement over the next year, especially in Las Vegas, California and Texas, where the company generates nearly half of its total annual revenue, Moody's believes financial flexibility will become very limited" said Brian Silver, a Moody's Vice President and lead analyst for Ahern Rentals. The ratings consider declines in Ahern's equipment utilization since the onset of the recession along with potential for yield pressure, and Moody's expectation that utilization will remain softer than pre-pandemic levels for the foreseeable future even considering some improvement since the most recent low point in mid-April. Key for utilization will be the development of new projects over the next year that call for the types of equipment that Ahern specializes in, specifically Aerial Work Platforms, not just the existing projects which will likely be completed. Ahern also has exposure to cyclical end market demand for equipment as well as the asset intensive nature of the equipment rental industry. Ahern has regional revenue concentration with roughly half coming from California, Las Vegas, and Texas, but this is down from 60% in 2014 and continues to improve as the company expands its footprint elsewhere. In addition, Ahern has elevated debt-to-EBITDA of about 4.9 times for the twelve months ended March 31, 2020, and Moody's expects leverage to increase to 6 times in 2020 (all ratios are Moody's adjusted unless otherwise stated). As well, the total revolver availability is less than $100 million prior to coming up against covenant limitations. Finally, ownership of the company by CEO Don Ahern and transactions with commonly controlled affiliates are a governance challenge. However, Ahern benefits from having no significant debt maturities until 2023 and Moody's expectation the company will significantly reduce its capital expenditures in the near term to conserve cash. Ahern will also benefit from payroll and other cost savings of about $4 million per month. The company has a growing footprint in the US equipment rental market spanning 31 states, although still quite concentrated in its core markets. Also, Moody's views the use of leases to fund a portion of its rental fleet favorably, because it preserves liquidity and flexibility to manage its overall investment in its rental fleet. The lease financing is in addition to the more traditional purchase model to capitalize on strong demand for equipment. The negative rating outlook reflects Moody's expectation that Ahern's profitability will decline in 2020, liquidity will be weak, and the company could breach a springing financial covenant on the ABL facility if availability falls to such a level that a compliance test is triggered. Moody's believes that Ahern has limited environmental risk associated with its operations, as well as limited social risk associated with its operations, aside from the recent Coronavirus situation. Ownership of the company by the CEO, Don Ahern, presents some key man risk and governance challenges. In addition, although commonplace for the last 20 years or more, the company's transactions with commonly controlled affiliates, including both manufacturing and non-manufacturing relationships, represent a governance risk. Ahern provides secured and unsecured loans, letters of credit, and lines of credit to certain of its affiliates. In addition, Ahern enters into transactions with affiliates to supplement its rental fleet (i.e. re-rent), lease its rental branches, ensure competitive logistics pricing, and maintain dealership access to original OEM parts and equipment. At March 31, 2020, Ahern had approximately $95.6 million due from commonly-controlled affiliates. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Although unlikely in the near term, the ratings could be upgraded if the company is able to strengthen its liquidity such that it can sustain more than $150 million of ABL availability without breaching a financial covenant that could trigger an event of default. Moody's would also expect debt-to-EBITDA be sustained below 5 times. The ratings could be downgraded if the company breaches a springing financial covenant that could trigger an event of default, or if debt-to-EBITDA is sustained above 7 times. Also, if the company makes increased loans to commonly controlled affiliates, the ratings could be downgraded. Finally, if Ahern purchases its debt at a significant discount to face value in the open market, thereby executing a distressed exchange, Moody's would deem this a default and downgrade the ratings. The following rating actions were taken: Downgrades: Issuer: Ahern Rentals Inc. Corporate Family Rating, Downgraded to Caa1 from B3 Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Senior Secured Regular Bond/Debenture, Downgraded to Caa2 (LGD5) from Caa1 (LGD5) Outlook Actions: Issuer: Ahern Rentals Inc. Outlook, Changed To Negative From Rating Under Review The principal methodology used in these ratings was Equipment and Transportation Rental Industry published in April 2017. Ahern Rentals Inc., headquartered in Las Vegas, NV, is an equipment rental company that has grown organically over the years and now has a network of 97 branches across 31 states, as well as a small international presence comprised of 13 sales and service branches accounting for approximately 5% of total revenue. The company generates approximately 70-75% of its revenue from the largest portion of its rental fleet, high reach equipment, which consists of boom lifts, forklifts, and scissor lifts. Ahern's majority shareholder is the company's Chairman and Chief Executive Officer, Don Ahern. Ahern reported March 31, 2020 LTM revenue of approximately $905 million. ALAMO CHANDLER: Alamo Drafthouse Franchisee Files for Chapter 11 ---------------------------------------------------------------- Brandon Brown of Phoenix Business Journal reports that an Alamo Drafthouse franchisee, who owns three theatre locations in Phoenix, sought Chapter 11 protection. The local owner said in a statement that the impact of the Covid-19 shutdowns forced the company into Chapter 11, but court documents show the booze- and food-serving theaters were in debt and losing money prior to the onset of the pandemic. The coronavirus outbreak and Arizona Gov. Doug Ducey's closure of all movie theaters most likely accelerated its existing issues. The three separate limited liability companies that filed for bankruptcy protection in the U.S. Bankruptcy Court's District of Arizona include Alamo Tempe LLC, Alamo Gilbert LLC,and Alamo Chandler LLC. "Our intention is to use this opportunity to reorganize our finances and plan for the road ahead. We hope that taking these steps will put us on track to open in the future," said Craig Paschich of Paschich Alamo Holdings LLC, the majority owner of these franchises. Between the three separate locations, the company has liabilities of over $5.5 million. The largest creditor to both the Gilbert and Tempe locations was Alamo Drafthouse Cinemas LLC, the theater's corporate office for franchise fees. The Chandler location had yet to file its list of top creditors with the court. According to the 2019 tax records, each Valley Alamo Drafthouse had assets of over $1 million in assets and the Chandler location claims more than $3 million. In 2019, the three locations reported a combined loss of $1.2 million. When the three Alamo Drafthouse locations filed their voluntary petition for Chapter 11 bankruptcy, each location included a balance sheet dated March 5, 2020. According to these financial records each Valley location was operating at a loss, with the Tempe location losing $139,308, Chandler losing $108,264, and Gilbert at $35,939. As of March 5, 2020, the movie theaters were still operating. On March 19, 2020, Arizona Governor Doug Ducey issued an executive order that shuttering all theaters across the state and driving their revenue zero. Currently, all three Alamo locations are closed due to Ducey's order. Movie theaters can technically open on May 16, 2020 but it is unknown when Alamo Drafthouse will open. In a motion filed with the court on May 14, 2020, the company said when it "is otherwise safe and economically reasonable," the Alamo Drafthouse will "resume operation of the theaters." About Alamo Chandler, et al. Alamo Tempe LLC, Alamo Gilbert LLC,and Alamo Chandler LLC are Alamo Drafthouse franchisees, owning three theatre locations in Phoenix. Craig Paschich of Paschich Alamo Holdings LLC is the majority owner of these franchises. Alamo Drafthouse Cinema is an American cinema chain founded in 1997 in Austin, Texas and famous for serving dinner and drinks during the movie. Alamo Chandler LLC, Alamo Tempe LLC, and Alamo Gilbert LLC sought Chapter 11 protection (Bankr. D. Ariz. Lead Case No. 20-05017) on May 13, 2020. In the petitions signed by Craig Paschich, member of Paschich Alamo Holdings, Alamo Chandler disclosed total assets of $2,790,300, and total liabilities of $2,961,665; Alamo Gilbert listed total assets of $2,040,234 and total liabilities of $1,732,004; and Alamo Tempe LLC disclosed total assets of $1,023,326 and total liabilities of $836,730. Wesley D. Ray, Esq., at Sacks Tierney P.A., serves as bankruptcy counsel to the Debtors. ALEXANDER D. BEAVER: Simond Buying Tractor for $20K Cash -------------------------------------------------------- Alexander D. Beaver asks the U.S. Bankruptcy Court for the District of Maine to authorize the sale of his 2005 Western Star, Model 4954, Cab and Chassis, VIN 5KJJAECK95PU92542, to M.A. Simond, LLC, for $20,000, cash, free and clear of all liens and encumbrances. Included in the property of the Debtor's estate is the Tractor, which he does not require for the continued operation of his business. The Tractor was owned pre-petition by Dirt Direct, LLC, the business entity under which Debtor operated his business. Pre-petition, Debtor transferred all of Dirt Direct, LLC’s assets to Debtor in consideration for the Debtor assuming all of Dirt Direct, LLC's debts. To the extent the Tractor is not sold prior to the filing of the Debtor's Chapter 11 Plan, the Debtor intends to surrender the Tractor, in the Plan, to the vehicle lien creditor, Katahdin Trust Co. Katahdin Trust Co. is first priority secured creditor with a lien on the title to the Tractor. Katahdin's secured claims, as noted in Proof of Claims #5 and #8, exceed $23,000. Simond of Lewiston, Maine, has offered to purchase the Tractor for $20,000 in cash payment. The Debtor wishes to sell the Tractor to Simond under those terms. He believes the $20,000 offer represents the fair market value for the Tractor, based upon his experience in the market buying and selling tractors and other large commercial equipment for his business. Katahdin Trust consents to the sale of the Tractor to Simond, free and clear of any liens, claims and encumbrances, under the above described terms and conditions, with the without the deduction of any broker commissions or other costs of sale. The Proceeds of the sale will be turned over to Katahdin to pay in full Proof of Claim #8, and partially pay off Proof of Claim #5. Katahdin is adequately protected because its liens will attach to the full proceeds of sale in the same amount and order of priority as they attached to the property. The Debtor will not receive any funds from the sale. The Debtor, through his counsel, has provided the US Trustee and Subchapter V Trustee with a true and accurate copy of the Motion prior to filing. Both the US Trustee and Subchapter V Trustee consent to the sale. Alexander D. Beaver sought Chapter 11 protection (Bankr. D. Maine Case No. 20-20111) on March 23, 2020. The Debtor tapped James Molleur, Esq., as counsel. ANDREW RUGGIERO: Selling Two Arizona Properties for $493K --------------------------------------------------------- Andrew Ruggiero asks the U.S. Bankruptcy Court for the District of Arizona to authorize the sale of (i) the real property located at 1401 Mineral Drive, Forest Lakes, Arizona to Jason Enyart for $225,000, cash; and (ii) the real property located at 13093 East Cibola Road, Scottsdale, Arizona to Wei Jin for $268,000, cash, both subject to higher and better offers. The Debtor owns certain real property in Arizona, California and Texas. The real property owned by the Debtor in Arizona is as follows: (i) a single family residence located 12770 East Gold Dust Avenue, Scottsdale, Arizona 85259 ("Debtor's Residence"); (ii) a single family residence located at 9490 North 105th Street, Scottsdale, Arizona 85258; (iii) a single family residence located at 15946 East Venetian Lane, Fountain Hills, Arizona 85268; (iv) the Forest Lakes Property, a single family residence; and (v) the Cibola Property, an undeveloped parcel of real property, zoned residential. The Debtor has determined that it is in the best interests of his bankruptcy estate and creditors to market and sell the Real Estate pursuant to an orderly marketing process. To that end, he has entered into, subject to the Court's approval, that certain Exclusive Right to Sell/Rent, Listing Contract with Raymond J. Plato of Viza Realty, LLC ("Arizona Broker") for him to act as the broker to market and sell the Arizona Real Estate. The Arizona Broker has negotiated, and the Debtor has agree to, subject to approval of the Court, consent of BMO Harris Bank, N.A., and subject to higher and better offers, the sale of the Forest Lakes Property to the Forest Lakes Buyer for the purchase price of $225,000, pursuant to the terms and conditions of that certain Residential Resale Real Estate Purchase Contract dated April 24, 2020 delivered by the Forest Lakes Buyer to the Debtor and that certain Counter Offer dated April 26, 2020 delivered by the Debtor and accepted by the Forest Lakes Buyer. The Forest Lakes Buyer's purchase of the Forest Lakes Property will be an all-cash sale, and close of escrow will be within twenty (20) days of the entry of the Court's order approving the sale. Pioneer Title Agency, Inc. will act as the title and escrow company in connection with the sale of the Forest Lakes Property to the Forest Lakes Buyer. The Forest Lakes Buyer has deposited the sum of $5,000 with the Title Company as an earnest money deposit pursuant to, and subject to the terms of, the Forest Lakes Purchase Contract. The Arizona Broker has negotiated, and the Debtor has agree to, subject to approval of the Court and subject to higher and better offers, the sale of the Cibola Property to the Cibola Buyer for the purchase price of $268,000, pursuant to the terms and conditions of that certain Vacant Land/Lot Purchase Contract dated April 27, 2020 and the series of subsequent counter-offers between the Cibola Buyer and the Debtor, culminating in an accepted offer dated April 28, 2020. The Cibola Buyer's purchase of the Cibola Property will be an all-cash sale, and close of escrow will be within 20 days of the entry of the Court's order approving the sale. Title Company will act as the title and escrow company in connection with the sale of the Cibola Property to the Cibola Buyer. The Cibola Buyer has deposited the sum of $23,750 with the Title Company as an earnest money deposit pursuant to, and subject to the terms of, the Cibola Purchase Contract. BMO holds a blanket lien encumbering the Debtor's Real Estate, including the Forest Lakes Property and the Cibola Property. The amount of BMO’s secured claim exceeds the value of the Forest Lakes Property and the Cibola Property. Therefore, BMO's consent to the proposed sales is required under Bankruptcy Code Section 363(f). The Debtor and BMO are in the process of discussing an appropriate marketing strategy for the sale of all of the Real Estate whereby, among other things, BMO will authorize and consent to the sale of the Real Estate under terms and conditions approved by the parties and the Court. Although BMO and the Debtor have not yet finalized their potential agreement regarding the sale of the Real Estate, subject to approval of the form of sale order and the terms and conditions set forth in the Motion, BMO has agreed to the sale of the Forest Lakes Property and the Cibola Property on the terms and conditions of the respective purchase contracts, and consents to the sale of the Forest Lakes Property and the Cibola Property free and clear of its liens encumbering those properties, subject to the entry of an order authorizing the sale that is acceptable to BMO, and provided, however, that BMO's liens will attach to 100% of the gross proceeds from the sale. Other than BMO's first priority liens and taxes for the second half of 2019 in the amount of $681, there are no other liens or encumbrances encumbering the Forest Lakes Property. Other than BMO's first priority liens and taxes for the second half of 2019 in the amount of $1,553, there are no other liens or encumbrances encumbering the Cibola Property. Pursuant to the Listing Contract and subject to satisfaction of BMO's conditions of consent, the Arizona Broker and the Forest Lakes Buyer's broker will each receive a commission of 3% of the total purchase price for the Forest Lakes Property upon the closing of the sale of the Forest Lakes Property. Pursuant to the Listing Contract and subject to satisfaction of BMO's conditions of consent, the Arizona Broker will receive a commission of 6% of the total purchase price for the Cibola Property upon the closing of the sale of the Cibola Property. There is no separate buyer broker for the Cibola Buyer. The Debtor asserts that these commissions are customary in the industry and are reasonable. Unless BMO otherwise agrees in writing, as a one-time accommodation to the Debtor, BMO will consent to the proposed sales of the Forest Lake Property and the Cibola only if each of the following conditions are satisfied: a. The proposed sales are subject to higher and better bids; b. The gross sales price for the Cibola Property is no less than $268,000; c. The gross sale price for the Forest Lakes Property is no less than $225,000; d. BMO's liens and security interests attach to 100% of the gross sale proceeds from each sale; e. Only the following amounts will be paid from the gross sales proceeds at closing: i. For the Cibola Property: 1. No more than $1,553 for the payment of real property taxes; 2. No more than 6% of the gross sales price in broker commissions; and 3. Other standard closing costs (e.g., title and recording fees, etc.), approved by BMO. ii. For the Forest Lakes Property: 1. No more than $680.76 for the payment of real property taxes; 2. No more than 6% of the gross sales price in broker commissions; and 3. Other standard closing costs (e.g., title and recording fees, etc), approved by BMO. f. Except as provided in subsection (e), the Title Company will indefeasibly distribute to BMO all remaining sale proceeds at closing in accordance with BMO's closing instructions. g. The form of order approving the sales is acceptable to BMO in all respects. h. Any modifications to the terms of the sales are approved by BMO in writing. i. BMO must approve the final settlement/closing statement prior to any closing. Subject to additional bids at the sale hearing (if any), the purchase prices agreed to by the Debtor and the Forest Lakes Buyer and the Cibola Buyer, respectively, represent the highest and best offers for the respective Properties. There has been no request for relief from the automatic stay filed with respect to either of the Properties. The Debtor will not relinquish title or possession of the Properties before the payment of the purchase price. Based on the foregoing, the Debtor asks that the Court enters its order granting the following relief: i. Setting a Sale Hearing as soon as practicable, within the requirements of the applicable Bankruptcy Rules, at which time the Court will consider the sale of the Properties as requested herein and will solicit higher and better bids for the Properties; ii. Approving the sale of the Forest Lakes Property to the Forest Lakes Buyer pursuant to the Forest Lakes Purchase Contract, subject to higher and better bids at the Sale Hearing; iii. Approving the sale of the Cibola Property to the Cibola Buyer pursuant to the Cibola Purchase Contract, subject to higher and better bids at the Sale Hearing; iv. Requiring that, to the extent any other parties desire to bid on the Forest Lakes Property, (a) any such bidders must deposit $5,000 with the Title Company, as an earnest money deposit, and provide evidence to the Court and the Debtor of their ability to consummate their purchase of the Forest Lakes Property, and (b) the bidding increments will be no less than $2,000 each; v. Requiring that, to the extent any other parties desire to bid on the Cibola Property, (a) any such bidders must deposit $23,750.00 with the Title Company, as an earnest money deposit, and provide evidence to the Court and the Debtor of their ability to consummate their purchase of the Cibola Property, and (b) the bidding increments will be no less than $2,000 each; vi. Authorizing the Debtor to execute any documents necessary to consummate the sale of the Properties pursuant to the terms of the Court's order approving the sale; vii. Subject to BMO's conditions of consent set forth, authorizing the payment, from the proceeds of the sale of the Properties, of all reasonable costs and expenses relating the sale of the Properties, including closing costs, fees and costs incurred by the Title Company, and real estate commissions in the total amount of 6% of the final purchase price pursuant to the terms of the Listing Agreement; viii. Subject to BMO's conditions of consent set forth, authorizing the payment, from the proceeds of the sale of the Forest Lakes Property, of the outstanding real property taxes for the second half of 2019; ix. Subject to BMO's conditions of consent set forth herein, authorizing the payment, from the proceeds of the sale of the Cibola Property, of the outstanding real property taxes for the second half of 2019; x. Authorizing that all remaining proceeds from the sale of the Properties be paid over to BMO and applied by BMO to the outstanding indebtedness owed by the Debtor to BMO; xi. Providing that the sales of the Properties are free and clear of all liens, claims, encumbrances and interests of any kind and nature, with BMO's liens and security interests attaching to 100% of the gross sale proceeds from each sale; xii. Finding that the Forest Lakes Buyer is a good faith purchaser, as contemplated by Bankruptcy Code section 363(m); xiii. Finding that the Cibola Buyer is a good faith purchaser, as contemplated by Bankruptcy Code section 363(m); xiv. Waiving the 14-day stay imposed by Bankruptcy Rule 6004(h); and xv. Granting such other and further relief as the Court deems just and proper. A copy of the Agreements is available at https://tinyurl.com/ybdr9fab from PacerMonitor.com free of charge. Andrew Ruggiero sought Chapter 11 protection (Bankr. D. Ariz. Case No. 20-01210) on Feb. 5, 2020. The Debtor tapped Randy Nussbaum, Esq., at Sacks Tierney P.A. as counsel. On April 20, 2020, the Court approved Raymond J. Plato of Viza Realty, LLC, as the Debtor's Arizona broker. APC AUTOMOTIVE: June 11 Deadline Set for Committee Applications --------------------------------------------------------------- The U.S. Trustee is soliciting members for an unsecured creditors committee in the bankruptcy cases of APC Automotive Technologies Intermediate Holdings, LLC, et al. If one wishes to be considered for membership on any official committee that is appointed, one must complete a required Questionnaire Form and return it to the Office of the United States Trustee no later than 4:00 p.m. (Central Standard Time), on Thursday, June 11, 2020 by email to rosa.sierra@usdoj.gov A representative from the U.S. Trustee's Office will contact all creditors submitting a questionnaire to arrange for a telephonic interview. Questions should be sent to Rosa Sierra using the email addresses above using the email addresses above. About APC Automotive APC Automotive Technologies Intermediate Holdings, LLC are aftermarket suppliers of brake, chassis, exhaust, and emissions parts for passenger vehicles, trucks, and commercial vehicles. The Debtors were formed through the merger of two companies in 2017, AP Exhaust and Centric. APC Automotive Technologies Intermediate Holdings, LLC and its thirteen affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 20-11466) on June 3, 2020. Templar Energy was estimated to have $100 million to $500 million in assets and $500 million to $1 billion in liabilities. Jonathan S. Henes, P.C. of Kirkland & Ellis LLP and Kirkland & Ellis International LLP serves as the Debtors' general bankruptcy counsel; Domenic E. Pacitti, Esq., Morton R. Branzburg, Esq., and Michael W. Yurkewicz, Esq. of Klehr Harrison Harvey Branzburg LLP serve as the local bankruptcy counsel. Jefferies Group LLC acts as the Company's financial advisor and Weinsweigadvisors LLC as restructuring advisor. Ernst & Young LLP is acting as the Company's tax advisor; and Bankruptcy Management Solutions, INC. serves as the Company's Notice, Claims, & Balloting Agent and Administrative Advisor. APC AUTOMOTIVE: S&P Downgrades ICR to 'D' on Chapter 11 Proceedings ------------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on APC Automotive Technologies Intermediate Holdings LLC to 'D' from 'CCC'. At the same time, S&P is lowering its issue-level rating on the company's A-1, A-2, and A-3 term loans to 'D' from 'CCC' and its issue-level rating on the company's term loan B to 'D' from 'CC'. S&P's '4' recovery rating on the A-1, A-2, and A-3 term loans remains unchanged, indicating its expectation for average (30%-50%; rounded estimate: 35%) recovery of principal in the event of a payment default. Its '6' recovery rating on the term loan B also remains unchanged. On June 3, 2020, APC Automotive Technologies announced that it had commenced voluntary Chapter 11 bankruptcy proceedings with the U.S. Bankruptcy Court for the District of Delaware. APC has reached an agreement in principle with certain debtholders through which it expects to reduce its outstanding debt by approximately $290 million on a net basis. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety APPLETON HOLDINGS: Sets Bid & Sale Procedures for All Assets ------------------------------------------------------------ Appleton Holdings, LLC, asks the U.S. Bankruptcy Court for Middle District of Florida to authorize bidding and sale procedures in connection with the auction sale of substantially all assets. In order to maximize the value of its assets for the benefit of all stakeholders in the Chapter 11 case, the Debtor has made the decision to proceed with the sale of substantially all of its assets pursuant to Sections 363 and 365 of the Bankruptcy Code to the highest and best bidder. The Debtor believes it is in the best interest of all stakeholders to proceed with an auction sale of the Debtor's assets at this time, so that a sale can be completed by the end of August 2020. Pursuant to the relief requested, the Debtor proposes, among other things, to establish a deadline by which interested bidders are required to submit a Qualified Bid for all assets of Appleton Holdings, LLC, except cash, causes of action, instruments, promissory notes, mortgages, and insurance policies. The Sale Assets include (i) the hotel and all operating rights (but not the land), (ii) assignment of the Ground Lease executed July 18, 2017 by and between Appleton Land, LLC and Appleton Holdings, LLC; and (iii) the personal property set forth on Exhibit A. If the Debtor receives more than one Qualified Bid, then the Debtor proposes to conduct an auction of the Sale Assets in order to obtain the highest and best bid for the Sale Assets. Immediately thereafter, the Debtor proposes to present such highest and best bid to the Bankruptcy Court for approval of a sale of the Sale Assets under Sections 363 and 365 of the Bankruptcy Code, free and clear of all liens, claims, encumbrances and interests of any kind. Upon approval of such bid by the Bankruptcy Court, the Debtor proposes to proceed promptly with the closing of such sale. Red Lion Hotels Franchising, Inc. asserts that it is owed money from the Debtor, and that such debt is secured by a lien on the Debtor's personal property. The Debtor disputes the validity of the debt and lien, and through the claims objection process the validity of the debt and lien will be determined. If the debt and lien are determined by the Court to be valid, then the purchaser of the Sale Assets will take such Sale Assets subject to the value of Red Lion's allowed claim. The purchaser will then (i) surrender the personal property securing the debt up to the amount of the allowed claim, (ii) pay the amount of the allowed claim to Red Lion, or (iii) reach a mutually agreeable solution with Red Lion such that Red Lion withdraws its claim, releases Debtor and purchaser, and terminates its lien in the public records. The Debtor submits that the sale of the Sale Assets pursuant to the procedures set forth is in the best interests of the Debtor, its creditors, its equity holders and the estate. The salient terms of the Bidding Procedures are: a. Bid Deadline: Not less than $10 million b. Initial Bid: July 27, 2020 c. Deposit: $1 million d. Auction: Aug. 3, 2020 e. Bid Increments: $50,000, subject to being increased or decreased in the Debtor's sole discretion at the Auction f. Sale Hearing: Aug. 10, 2020 g. Sale Objection Deadline: At 4:00 p.m. (ET) two business days before the Sale Hearing h. Closing: Not later than Aug. 31, 2020 i. The sale is "as is, where is" -- with all faults, but free and clear of any and all liens, claims, encumbrances and interests, except as to the personal property that is allegedly subject to Red Lion's claim. j. Acres Loan Origination, LLC will be deemed a Qualified Bidder up to the amount of its Secured Claim and Acres does not have to post a deposit. The known putative Lienholders and approximate amount of Debt are: (i) Acres - $17,281,669; (ii) DW Commercial Finance - Unknown; and (iii) Red Lion - $178,341. The Debtor's bankruptcy estate will not be liable for any broker's commissions. The Debtor believes that the closing of the sale of the Sale Assets needs to occur expeditiously given that long term management is critical to maintaining existing customers. As a result, it asks that the Court includes in the Sale Order a provision waiving the 14-day stay set forth in Rule 6004(h) of the Federal Rules of Bankruptcy Procedure and providing that the sale may be consummated immediately after entry of the Sale Order. A copy of the Exhibit A is available at https://tinyurl.com/y9bzjpht from PacerMonitor.com free of charge. About Appleton Holdings Appleton Holdings, LLC operates a Red Lion branded 390-room convention and business class hotel located at 333 W. College Ave., Appleton, Wisc. Appleton Holdings sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-04883) on July 25, 2019. At the time of the filing, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Karen S. Jennemann oversees the case. Kenneth D. Herron, Jr., Esq., at Herron Hill Law Group, PLLC, is the Debtor's legal counsel. ARCHDIOCESE OF NEW ORLEANS: Hires Jones Walker as Counsel --------------------------------------------------------- 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 Jones Walker LLP as its counsel. The Debtor requires Jones Walker to: a. advise the Archdiocese with respect to its rights, powers and duties as Debtor and Debtor-in-Possession in the continued operation and management of the business and its assets; b. prepare and pursue confirmation of a plan of reorganization and approval of a disclosure statement; c. prepare on behalf of the Archdiocese all necessary applications, motions, answers, proposed orders, other pleadings, notices, schedules and other documents, and reviewing all financial and other reports to be filed; d. advise the Archdiocese concerning and preparing responses to applications, motions, pleadings, notices and other documents which may be filed by other parties; e. appear in Court to protect the interest of the Debtor before this Court; f. represent the Debtor in connection with use of cash collateral and/or obtain postpetition financing; g. advise the Debtor concerning and assisting in the negotiation and documentation of financing agreements, cash collateral orders and related transactions; h. investigate the nature and validity of liens asserted against the property of the Archdiocese, and advising the Archdiocese concerning the enforceability of liens; i. investigate and advise the Archdiocese concerning, and taking such action as may be necessary to collect income and assets in accordance with applicable law, and the recovery of property for the benefit of the Debtor's estate; j. advise and assist the Debtor in connection with any potential property dispositions; k. advise the Debtor concerning executory contract and unexpired lease assumptions, assignments, or rejections; l. take all necessary action to protect and preserve the Debtor's estate, including the prosecution of actions on the Debtor's behalf, the defense of any actions commenced against the Debtor, the negotiation of disputes in which the Debtor is involved, and the preparation of objections, as necessary, to relief sought and claims filed against the Debtor's estate; m. advise the Debtor concerning the settlement of claims against the Debtor's insurers; n. provide legal advice and perform legal services with respect to matters relating to corporate governance, the interpretation, application or amendment of the Debtor's organizational documents, material contracts, and matters involving the fiduciary duties of the Debtor and its officers, directors and managers; and o. provide other legal services for the Debtor which may be necessary and proper in this Chapter 11 Case. The compensation of Jones Walker's attorneys and paraprofessionals are: Jones Walker will charge these hourly fees: Partners $400 to $490 Associates $250 to $270 Paraprofessionals $155 to $170 Mark Mintz, Esq., a partner at Jones Walker, disclosed in court filings that his firm does not have any interests adverse to the Debtors' estates, creditors and equity interest holders. In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Mr. Mintz disclosed in court filings that his firm has not agreed to a variation of its standard or customary billing arrangements for its employment with the Debtor, and that no Jones Walker professional has varied his rate based on the geographic location of the Debtors' bankruptcy cases. Jones Walker represented the Debtors for years prior to the petition date. The billing rates and material financial terms in connection with such representation have not changed post-petition other than due to annual and customary firm-wide adjustments to the firm's hourly rates in the ordinary course of its business, Mr. Mintz further disclosed. Jones Walker has consulted with the Debtors and agreed upon an approved budget and staffing plan for the firm's engagement, according to the Debtors' attorney. The firm can be reached through: Mark A. Mintz, Esq. Jones Walker LLP 201 St. Charles Ave New Orleans, LA 70170-5100 Direct: 504.582.8368 Fax: 504.589.8368 Email: mmintz@joneswalker.com 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. ART VAN: Trustee Selling Mattress & Furniture Inventory for $25.7M ------------------------------------------------------------------ Alfred T. Giuliano, chapter 7 trustee to the estates of Art Van Furniture, LLC and affiliates, asks the U.S. Bankruptcy Court for the District of Delaware to authorize the private sale of all of the Company's "Levin Mattress" and "Levin Furniture" inventory, and operating assets located in Ohio and Pennsylvania and related intellectual property to Levin Furniture, LLC and Levin Trucking, LLC for the purchase price of $25.7 million, subject to adjustment, subject to higher and better offers. The Trustee asks the Court's approval of a $25.7 million sale of assets, including inventory and rolling stock and vehicles, and assumption of over $660,000 in rejection damages and post-petition claims for three locations, all of which provides enormous benefits to the estates. Importantly, $10 million of the total purchase price consists of a fund earmarked for customers at the applicable Ohio and Pennsylvania stores subject to the sale, and the fund approximates the total liability to such customers and is expected to make them whole by allowing the customers to receive their ordered furniture, receive store credit, or receive a cash refund. That customer earmarked fund was heavily negotiated by the Trustee and his professionals and is supported by the Debtors’ ABL lender, Wells Fargo Bank. In addition, the leases for the 32 stores subject to the sale will be rejected and the Purchaser will use its best efforts to vacate the stores as soon as possible, rather than the stores being used for a months-long "going out of business sale process that would have likely entangled the estates in various issues and resulted in difficult negotiations (and more chapter 7 administrative costs) with the applicable landlords, who can now have their locations returned to them months earlier than expected. The sale should be approved because it provides significant benefits to the estates and is a sound exercise of the Trustee's business judgment. The APA generally provides for the sale of all of the Company's "Levin Mattress" and "Levin Furniture" inventory and operating assets located in Ohio and Pennsylvania and related intellectual property. The aggregate purchase price is approximately $25.7 million (subject to adjustment), of which $10 million has been earmarked for the benefit customers that placed orders or deposits at the Subject Stores -- which, upon information and belief, approximates the total liability to such customers. In other words, a critical component of the proposed sale is to make Levin customers in Ohio and Pennsylvania whole by allowing them to receive their ordered furniture, receive store credit, or receive a cash refund. The APA also provides for the (i) sale of the rolling stock and vehicles of Debtor LF Trucking, Inc. and (ii) assumption of rejection damages and postpetition claims associated with certain leases. The Trustee believes it is in the best interest of the Debtors' estates, their creditors, their customers, and all parties in interest to complete the Sale under the terms of the APA. The key terms of the APA are: a. Purchasers: Levin Furniture, LLC and Levin Trucking, LLC b. Seller: Alfred T. Giuliano, chapter 7 trustee to the estates of Debtors Sam Levin, Inc. ("SLI") and LF Trucking, Inc. ("LFT") c. Releasing Landlords: The Releasing Landlords are (a) Robert Levin, (b), Elyria Chestnut, LLC, and (c) 2505 Pitkin Corp. The Releasing Landlords are the landlords at the following locations: (i) 301 Fitz Henry Road, Smithton, PA 15479; (ii) 510 Chestnut Commons, Elyria, OH 44035; and (iii) 10688 Perry Highway, Pittsburgh, PA 15090 ("Releasing Locations"). d. Purchase Price: The Purchase Price consists of the following: (a) $13,728,000, which represents the Inventory Valuation; plus (b) $1.4 million, which represents in the aggregate the Equipment Valuation ($150,000), the Included Rolling Stock Value ($1 million), and the Proprietary Rights Valuation ($250,000); plus (c) $10 million, which represents the Customer Claim Advance; plus (d) $660,002, which represents additional consideration in the form of: the assumption of rejection damages and post-petition claims associated with the Releasing Locations. In total, the Purchase price is $25,788,002. e. Purchased Assets: Substantially all assets f. Customer Claim Advance Fund: As part of the Purchase Price and all other amounts to be paid by the Purchaser pursuant to the APA, at the Closing, the Purchaser will deposit with the Trustee by wire transfer an amount equal to $10 million. The Customer Claim Advance Fund will not be subject to the liens, claims, or encumbrances of any creditor of the Debtors, except as may be specifically provided in Section 6. g. Assumed Liabilities: The Assumed Liabilities include the following: (a) all Liabilities under, arising from or relating to the Assumed Contracts with respect to (i) matters occurring thereunder on or after the Closing Date, and (ii) the Cure Amounts; (b) all liabilities and obligations first arising after the Closing under or associated with Seller’s privacy policy, which policy will be adopted by Purchaser as of the Closing (a full and complete copy of which Purchaser acknowledges having received from Seller); and (c) all Liabilities agreed to be paid by the Purchaser pursuant to Section 3.2 of the APA. h. Breakup Fee: N/A i. Outside Closing Date: June 15, 2020 j. Representations and Warranties: The APA contains standard representations and warranties in Sections 4 and 5 of the APA. k. Deposit: $2 million l. Successor Liability: N/A The sale is intended to be a private sale, however, the Trustee reserves all rights to accept higher and better offers for the Purchased Assets up until the proposed sale hearing on the Motion. The Purchaser is only willing to complete the sale of the Purchased Assets if those are sold free and clear of all liens, claims, and encumbrances. Accordingly, the Trustee is seeking authorization to sell the Purchased Assets free and clear of all liens, claims, and encumbrances to maximize value. The Trustee submits that the proposed private sale to the Purchaser in accordance with the APA is appropriate in light of the facts and circumstances of these chapter 7 cases. Specifically, a long and complicated sale process with bid procedures and an auction is unlikely to net the estates a significant appreciable benefit through a substantially increased sale price in light of the costs and expenses for running a competitive bid and sale process. The APA provides for the rejection of the Rejected Leases subsequent to the closing of the Sale. By the Motion, the Trustee asks authority to effectuate the rejection of a Rejected Lease by filing a notice with the Court, subsequent to the closing of the Sale, declaring that the it has irrevocably surrendered the premises concerning a Rejected Lease; and that a Rejected Lease will be deemed terminated effective as of the Rejection Effective Date. Rejection, and the procedure requested herein, is appropriate and supported by sound business reasons, as such Rejected Leases will no longer be of any benefit to the estates' once the Purchased Assets have been removed from the leased premises. Accordingly, rejection is appropriate under the terms of the APA. The Trustee believes that, as of the Rejection Effective Date, the Purchaser will have removed all of the Debtors' owned personal property assets located at the leased premises associated with the Rejected Leases. However, out of an abundance of caution and solely to the extent that the estates retain any ownership interest in any Remaining Personal Property, the Trustee asks authority to abandon any Remaining Personal Property assets that remain at the locations subject to the Rejected Leases as of the Rejection Effective Date. The Trustee seeks to abandon any Remaining Personal Property assets described "as is, where is." The Trustee's assumption and assignment of the Assumed Contracts to the Purchaser meets the business judgment standard and satisfy the requirements of section 365 of the Bankruptcy Code. The assumption and assignment is necessary for the Purchaser to receive the full benefits under the sale of the Purchased Assets. Consequently, the Trustee submits that assumption of the Assumed Contracts and payment of the Cure Amounts at the closing of the Sale is fair and reasonable and an appropriate exercise of the Trustee’s business judgment. Notwithstanding the requested relief for approval of the Sale as a private sale, the Trustee reserves all rights, in the exercise of his business judgment, to accept any higher and better offers for an alternative transaction for the Purchased Assets, that the Trustee determines, in the exercise of his business judgment, will provide a greater value for the estates. The Trustee expressly reserves the right to accept higher and better offers up until the hearing to approval the Sale and the relief requested in the Motion. The Purchaser is ready, willing, and able to close the Sale. Because the liens, claims, and encumbrances will attach to the sale proceeds, the Trustee submits there is no prejudice to creditors by having an order approving the Motion become effective immediately upon its entry. In addition, there is a risk of deterioration of the value of the Purchased Assets if the APA is not consummated quickly. Accordingly, the Trustee is requesting a waiver of the fourteen-day stay requirement under Bankruptcy Rule 6004(h). A copy of the Rejected Releases is available at https://tinyurl.com/y7xmda48 from PacerMonitor.com free of change. A hearing on the Motion was set for May 27, 2020 at 11:00 a.m. (ET). The objection deadline was May 22, 2020 at 12:00 p.m. (ET). 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. BODY RENEW: Proposes Sale of Anchorage Exercise Equipment --------------------------------------------------------- Body Renew Alaska, LLC, asks the U.S. Bankruptcy Court for the District of Alaska to authorize the sale of its exercise equipment in its facility at 202 East Northern Lights Boulevard, Anchorage, Alaska. On the petition date, the Debtor operated at the Location and at two others in Anchorage. All were closed as a result of the Covid-19 health emergency, the restrictions of which have recently been lifted to a limited extent. As a result of the closing the Debtor was not able to pay April or May rent, and the landlord Baker Holdings #1, LLC moved for relief from stay to evict the Debtor. The Debtor has analyzed the likely income to be generated at the Location once allowed to operate normally and the labor and operating costs which will then be incurred, and has determined that it is not going to be able to operate profitably and pay the contractual rent. The need to cure missed rent payments as an administrative expense is yet another burden on ongoing operations. The Debtor's conclusion is that it in the best interests of the bankruptcy estate to reject the lease and vacate the premises in an orderly manner. Vacating the premises will include selling the equipment in place to the extent possible in a relatively short time, and moving the balance to another location for additional sales with any unsold items to be placed in storage. Exhibit 1 is the list of the equipment. The equipment was (and is) subject to security agreements in favor of Alaska USA Federal Credit Union nd Evergreen Business Capital, acting for the US Small Business Administration. Alaska USA has a first lien on the equipment by virtue of a Commercial Security Agreement entered into with the Debtor on Dec. 28, 2012, and UCC filed on Jan. 5, 2013, at 2013-751347-1, extension filed on July 12, 2017, at 2017-012890-6, covering all equipment including but not limited to the following attached exhibits for 202 E. Northern Lights, Anchorage, AK; 12600 Old Seward Highway, Anchorage, AK; 12400 Old Glenn Highway, Eagle River, AK; and 1325 E. Palmer-Wasilla AK #108 Wasilla, AK locations; whether any of the foregoing is owned now or acquired later, all accessions, additions, replacements, and substitutions relating to any of the foregoing, and a Commercial Security Interest entered into with the Debtor on Oct. 1, 2013, to secure loans ********16-10 and ***8416. A certified UCC search has been obtained and it shows that Alaska USA has a first in time active UCC recording on the equipment. The Debtor and Alaska USA have determined the best way to sell the equipment is through advertising on the internet and by a combination of sales on site and internet auction. Other methods may be employed. The sales will be made to individuals who wish to purchase gym-quality equipment for home use, or to professionals who may want equipment for therapy treatments. Alternatively, some sales may be made "in bulk" to other commercial uses who may want to expand or upgrade their offerings. It is also possible that an auctioneer may be employed with further Court approval. There needs to be flexibility in pricing in order to encourage sales and reduce the need to relocate the equipment to the extent possible. The values on Exhibit 1 are target prices, but the Debtor asks authority to sell specific items at lower prices with the approval of Alaska USA. As Alaska USA’s loan balances far exceed the total value of the equipment to be sold, approval from Alaska USA and Debtor are both motivated to obtain the best prices reasonably available under the circumstances. The Sales will be free and clear of liens, and will be "as is" and "where is" without warranties. The Debtor needs to carry out these sales expeditiously in order to reduce its loan balance and simplify its operations, and therefore asks an order from the Court. A copy of the Exhibit 1 is available at https://tinyurl.com/yd9hq2wt from PacerMonitor.com free of charge. About Body Renew Alaska Body Renew Alaska, LLC -- https://bodyrenewalaska.com/ -- is a physical fitness company offering personal training, group fitness classes, weight loss programs, and nutritional counseling. Body Renew Alaska, LLC, filed its voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr D. Alaska Case No. 20-00075) on March 6, 2020. In the petition signed by Brian Horschel, owner and manager, Debtor was estimated to have $1 million to $10 million in both assets and liabilities. Judge Gary Spraker oversees the case. The Debtor tapped David H. Bundy, P.C. as its legal counsel, and Rulien & Associates, LLC as its accountant. BRIGHT MOUNTAIN: Closes Accretive Acquisition of CL Media Holdings ------------------------------------------------------------------ Bright Mountain Media, Inc. has acquired CL Media Holdings d/b/a/ Wild Sky Media from Centre Lane Credit Partners Master Credit Fund II, L.P. in a secured term loan and stock transaction. The acquisition of Wild Sky is expected to be immediately accretive to Bright Mountain Media. Wild Sky Media, an interactive media company that offers significant global reach through its hyper-engaging content and niche audiences, has become a wholly-owned subsidiary of Bright Mountain Media. Wild Sky Media is the home to parenting and lifestyle brands CafeMom, Mom.com, LittleThings, Revelist, Babynamewizard and MamasLatinas, reaching over 360 million unique and diverse users annually. In fiscal 2019, Wild Sky generated total gross revenues of approximately $22.6 million with gross margins over 50%. The transaction was completed on a debt-free and cash-free basis, free and clear of any liens and encumbrances for a total enterprise value of $15.0 million, in addition to 2.5 million shares of common stock of Bright Mountain Media, Inc. Centre Lane funded a $15.0 million first lien senior secured term loan to Bright Mountain Media to finance the purchase price at closing. "The Wild Sky Media team has done an incredible job developing its brand, telling unique stories to a diverse group of parents with a digital portfolio that has become a leading voice in the space," said Kip Speyer, chairman and chief executive officer of Bright Mountain Media. "Together, we will help Wild Sky Media reach consumers more efficiently while building out our portfolio of Bright Mountain Media owned websites. We look forward to working with their team to harness our innovations in digital media and advertising services, creating sustainable, long-term value for our shareholders." "This merger allows us to continue executing upon our mission of building the next generation of brands that young women can identify with," said Emily Smith, chief executive officer of Wild Sky Media. "Bright Mountain's culture and technology, including its proprietary content and ad delivery platform, allows for a strategic and effective combination. We believe this will be a seamless, positive change for our team and enable accelerated growth in the remainder of 2020 and beyond." Greg Peters, president and chief operating officer of Bright Mountain Media, commented: "Wild Sky Media's portfolio is highly complementary to our growing end-to-end digital media and advertising services platform. When coupled with our proprietary content and ad delivery technologies, we are confident that their highly targeted audience of over 30 million unique visitors per month will deliver clear benefits to our stakeholders." About Bright Mountain Based in Boca Raton, Fla., Bright Mountain Media, Inc. -- http://www.brightmountainmedia.com/-- is a digital media holding company whose primary focus is connecting brands with consumers as a full advertising services platform. Bright Mountain Media's assets include an ad network, an ad exchange platform and 24 websites which are customized to provide its niche users, including active, reserve and retired military, law enforcement, first responders and other public safety employees with products, information and news that the Company believes may be of interest to them. Bright Mountain reported a net loss of $3.40 million for the year ended Dec. 31, 2019, compared to a net loss of $5.22 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $80.46 million in total assets, $12.96 million in total liabilities, and $67.49 million in total shareholders' equity. EisnerAmper LLP, in Iselin, New Jersey, the Company's auditor since 2018, issued a "going concern" qualification in its report dated May 14, 2020, citing that the Company has experienced recurring net losses, cash outflows from operating activities, and has an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. BROADVISION: Emerges from Bankruptcy, Completes Restructuring ------------------------------------------------------------- The Globe Newswire reports that on May 15, 2020, BroadVision Inc. announced that the company successfully emerged from Chapter 11 bankruptcy protection, has completed the financial restricting process, and has implemented its corporate reorganization plan, as confirmed by the U.S.Bankruptcy Court District of Delaware (the "Confirmation Order"). Certain capitalized terms in this release that are not otherwise defined herein will have the meanings assigned to them in the Plan. Pursuant to the Confirmation Order, holders of Allowed Claims against the Debtor will receive full payment of their Claims. Additionally, holders of record of the Company's common stock ("Debtor Common Stock") traded on the Nasdaq Stock Market through the close of business on Monday, May 18, 2020 are entitled to receive a cash distribution in the amount of $4.375 per share (assuming no more than 5,142,333 shares are outstanding) (the "Equity Interest Recovery"), plus each holder's pro rata share of the Company's cash on hand (including proceeds from the sale of a block of IP addressed owned by the Company) as of the effective date of the Plan. Cash payments may be issued in one or more distributions and will be issued by the Company's Distribution Trust and in accordance with the Plan. The Equity Interest Recovery may be less than $4.375 per share of Debtor Common Stock in the event that (A) the Debtor has more than 5,142,333 shares of Debtor Common Stock outstanding (including all Outstanding Shares, Restricted Stock Awards, Restricted Stock Units and Permitted Stock Options, whether or not vested) or (B) the Debtor lacks sufficient Cash (including Cash-on-Hand and proceeds from the liquidation of the IP Addresses) to pay all Case-Related Claims and Expenses and repayment of amounts, if any, incurred by ESW Capital, LLC ("ESW") in connection with funding such Case-Related Claims and Expenses. Nasdaq indicated to Broadvision that it will suspend trading of the Debtor Common Stock effective as of the close of business on Monday, May 18, 2020. Nasdaq will file with the Securities and Exchange Commission (the "SEC") a Form 25 notifying the SEC of Nasdaq's withdrawal of the Debtor Common Stock from listing on the Nasdaq Stock Market and the intention to withdraw the Debtor Common Stock from registration under the Securities Exchange Act of 1934. In lieu of receiving cash distributions as mentioned above, ESW purchased 100% of the equity interests of the reorganized Company in exchange for ESW's holdings of the Company's common stock, free and clear of any options, liens, or other claims. About BroadVision BroadVision, Inc. -- https://broadvision.com/ -- develops,markets, and supports enterprise portal applications that enable companies to unify their e-business infrastructure and conduct interactions and transactions with employees, partners, and customers through a personalized self-service model. BroadVision, Inc., based in Redwood City, CA, filed a Chapter 11 petition (Bankr. D. Del. Case No. 20-10701) on March 30, 2020. In the petition signed by Pehong Chen, president, chief executive officer and interim chief financial officer, the Debtor disclosed $4,447,000 in assets and $2,489,000 in liabilities. The Hon. Christopher S. Sontchi oversees the case. DLA Piper LLP(US) serves as bankruptcy counsel to the Debtor. Epiq Corporate Restructuring,LLC, is the claims and noticing agent. CALIFORNIA PIZZA: S&P Lowers ICR to 'D' on Missed Interest Payments ------------------------------------------------------------------- S&P Global Ratings lowered all of its ratings on U.S.-based restaurant operator California Pizza Kitchen Inc. (CPK), including its issuer credit rating, to 'D'. The downgrade follows CPK's failure to make the interest payments due on its first- and second-lien term loans as of the end of May. The company has entered into a forbearance agreement with its lenders related to its existing events of default on May 28, 2020. The company separately raised a bridge loan in April 2020 that requires it to file a restructuring support agreement by June 15, 2020, and S&P expects the company will restructure its debt obligations. CPK's performance was weak prior to the ongoing disruption stemming from the coronavirus pandemic; however, S&P believes the pandemic contributed additional operating pressure and potentially accelerated the need to restructure the company's debt. S&P expects to discontinue its ratings on the company in the next 30 days. Environmental, social, and governance (ESG) factors relevant to this rating action: -- Health and safety CALIFORNIA RESOURCES: Signs Forbearance Agreements with Lenders --------------------------------------------------------------- California Resources Corporation and certain of its subsidiaries entered into forbearance agreements with: * certain lenders of approximately 84.6% of the outstanding principal amount of the loans under its Credit Agreement, dated as of Sept. 24, 2014, by and among the Company, as the Borrower, the subsidiary guarantors party thereto, the various Lenders identified therein, JPMorgan Chase Bank, N.A., as Administrative Agent, a Lender and a Letter of Credit Issuer, and Bank of America, N.A., as a Lender and a Letter of Credit Issuer; * certain lenders of approximately 61.6% of the outstanding principal amount of the term loans under its Credit Agreement, dated Aug. 12, 2016, by and among the Company, as the Borrower, the various Lenders identified therein and The Bank of New York Mellon Trust Company, N.A., as Administrative Agent; and * certain lenders of approximately 79.1% of the outstanding principal amount of the term loans under its Credit Agreement, dated as of Nov. 17, 2017, by and among the Company, as the Borrower, the subsidiary guarantors party thereto, the various Lenders identified therein and The Bank of New York Mellon Trust, N.A., as Administrative Agent. Pursuant to the Forbearance Agreements, the Forbearing Parties agreed to forbear from exercising any remedies under the Credit Agreements with respect to the failure to make certain interest payments due on May 29, 2020 until the earlier of (a) 11:59 p.m. (New York time) on June 14, 2020 and (b) the date the Forbearance Agreements otherwise terminate in accordance with their terms. The Forbearance Agreements contain certain representations and warranties of the Company and covenants with which the Company must comply during the forbearance period. The failure to comply with such covenants, among other things, would result in the early termination of the forbearance period. About California Resources California Resources Corporation -- http://www.crc.com/-- is an oil and natural gas exploration and production company headquartered in Los Angeles, California. CRC operates its resource base exclusively within the State of California, applying complementary and integrated infrastructure to gather, process and market its production. California Resources reported a net loss attributable to common stock of $28 million for the year ended Dec. 31, 2019, compared to net income attributable to common stock of $328 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $6.96 billion in total assets, $709 million in total current liabilities, $4.87 billion in long-term debt, $146 million in deferred gain and issuance costs, $720 million in other long-term liabilities, $802 million in redeemable non-controlling interests, and total deficit of $296 million. * * * In March 2019, S&P Global Ratings affirmed its 'CCC+' issuer credit rating on California Resources Corp. The affirmation reflects S&P's expectation that CRC will continue to support its liquidity by balancing its spending with its cash flow, selling non-core assets, and potential for joint ventures in 2019 as mentioned in the Company's fourth quarter conference call. As reported by the TCR on April 6, 2020, Moody's Investors Service downgraded California Resources Corp.'s Corporate Family Rating to Caa3 from Caa1. The rating actions reflect CRC's elevated restructuring risk, including the potential for a bankruptcy filing or distressed exchange, following its failed attempt to execute a debt for debt exchange in March. CELADON: Seeks to Publicly Auction its Trucking Businesses ---------------------------------------------------------- Freightwaves reports that Celadon Group asked permission from the U.S. Bankruptcy Court to allow the company to hold a public auction for its Mexican businesses. According to Delaware bankruptcy court filings, Celadon is in discussions with White Willow Holdings to sell its Mexico business for $2.4 million, after the proposed $7 million sale to P.A.M. Transportation Services Inc. (NASDAQ: PTSI) fell through in April 2020. The May 14, 2020 court filing states that a group of unsecured creditors had asked the court to halt the sale to White Willow, proposing the sale be completed through a public auction. The sale to White Willow Holdings was set for a hearing but representatives for Celadon filed a motion stating that they "have received numerous unsolicited expressions of interest for the Mexican assets." Celadon representatives filed a motion to establish a public bid deadline of June 8, 2020 for the Mexican assets, with an auction possibly proceeding on June 11, 2020. Its Mexico assets include wholly owned subsidiaries Celadon Mexicana, Jaguar Logistics and Leasing Servicios. In a separate court filing, Cincinnati-based Huntington Bank also filed a motion to block the sale of Celadon's Mexico business, saying it was owed more than $3 million for trailers it had financed for Celadon. Representatives for the bank said some of the trailers may be located in Mexico. About Celadon Group Celadon Group, Inc. -- https://celadontrucking.com/ -- is a North American truckload freight transportation company, primarily providing point-to-point shipping, warehousing, supply chain logistics, tractor leasing and other transportation and logistics services for major customers throughout North America. Celadon Group and 25 affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-12606) on Dec. 8, 2019. As of Dec. 2, 2019, the Debtors disclosed $427 million in assets and $391 million in liabilities. Judge Karen B. Owens oversees the cases. The Debtors tapped DLA Piper LLP (US) as bankruptcy counsel; Scudder Law Firm, P.C., L.L.O. as special counsel; Alixpartners, LLP as financial advisor; and Kurtzman Carson Consultants, LLC, as notice, claims and balloting agent and administrative advisor. CHRISTOPHER S. HARRISON: Selling 1969 Camaro for More than $40K --------------------------------------------------------------- Christopher S. Harrison asks the U.S. Bankruptcy Court for the Eastern District of North Carolina to authorize the sale of his 1969 Chevrolet Camaro to any private party who is not an insider for more than a minimum of $40,000. The vehicle has 840.4 miles and is in good condition. The NADA high retail value is $45,400. The Debtor proposes to sell this vehicle to any private party who is not an insider for more than a minimum of $40,000. The sale of the 1969 Chevrolet Camaro is being proposed in good faith and is in the best interest of the estate. Christopher S. Harrison sought Chapter 11 protection (Bankr. E.D.N.C. Case No. 19-05730) on Dec. 13, 2019. The Debtor tapped William P. Janvier, Esq., at Janvier Law Firm, PLLC, as counsel. COSTA HOLLYWOOD: Hires Frank Weinberg as Special Counsel -------------------------------------------------------- Costa Hollywood Property Owner, LLC, seeks authority from the US Bankruptcy Court for the Southern District of Florida to employ Frank Weinberg Black, P.L., as its special counsel. The Debtor desires to expand the scope of employment and retention of special counsel and the Firm as its special counsel in connection with the collection of delinquent assessments/shared costs or any other amount owed by Unit Owners. The Firm's proposed compensation are reduced hourly rates at $295 per hour to handle the collections based on: a) Collection Letter (without Claim of Lien) – Flat Fee of 0.5 Hours, plus mailing costs. b) Collection Letter (with Claim of Lien) – Flat Fee of 1.0 Hours, plus mailing/recording costs. c) Pre-Suit Payment Plan Agreements – Flat Fee of 1.0 Hours, plus mailing costs. d) Litigation/Foreclosure - $650 "cost retainer" paid prior to preparation of lawsuit (i.e. filing fee, service of process, etc.) and thereafter work on hourly basis, as necessary. Michael R. Kassower, attorney with Frank Weinberg, attests that neither he nor the Firm represents any interest adverse to the captioned Debtor or its estate with respect to the matters for which he is to be employed. The firm can be reached through: In accordance with Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, Mr. Kassower disclosed that: -- it has not agreed to any variations from, or alternatives to, its standard or customary billing arrangements for this engagement; -- none of the professionals included in the engagement vary their rate based on the geographic location of the bankruptcy case; -- the agreed upon reduced hourly rates for the Debtor were: associates in the firm charge between $295- $350 and partners charge $375 hourly; and -- the Debtor and the firm expect to develop a prospective budget and staffing plan, recognizing that in the course of this Chapter 11 case, there may be unforeseeable fees and expenses that will need to be addressed by the parties. The firm can be reached through: Michael R. Kassower, Esq. Frank Weinberg Black, P.L. 1875 Corporate Blvd NW Boca Raton, FL 33431 Phone: +1 561-989-0700 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. COVENANT CHURCH: Case Summary & 2 Unsecured Creditors ----------------------------------------------------- Debtor: Covenant Church of Pittsburgh 1111 Wood Street Pittsburgh, PA 15221 Business Description: Covenant Church of Pittsburgh is a tax- exempt religious organization. Chapter 11 Petition Date: June 9, 2020 Court: United States Bankruptcy Court Western District of Pennsylvania Case No.: 20-21778 Debtor's Counsel: Robert O Lampl, Esq. ROBERT O LAMPL LAW OFFICE Benedum Trees Building 223 Fourth Avenue, 4th Floor Pittsburgh, PA 15222 Tel: 412-392-0330 E-mail: rlampl@lampllaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Bishop Joseph L. Garlington, Sr., president. A copy of the 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/U44mNZ CUMULUS MEDIA: S&P Alters Outlook to Negative, Affirms 'B-' ICR --------------------------------------------------------------- S&P Global Ratings affirmed its 'B-' issuer credit rating on Cumulus Media Inc. and revised its outlook to negative from stable. S&P expects declines in advertising revenue will cause Cumulus' cash flow to become modestly negative in 2020, although the rating agency expects it will improve in 2021 as the economy recovers. S&P believes Cumulus has some ability to reduce costs, but this will be insufficient to offset a material decline in its revenue in 2020 and result in modestly negative free operating cash flow (FOCF). Cumulus identified $60 million of fixed cost savings in 2020 (such as executive pay cuts, furloughs, and sports rights) and will have lower variable costs (mainly sales commissions) as its revenue declines, but its operations were already relatively lean after pursuing cost savings initiatives over the past few years. However, S&P expects the company's FOCF will return to positive levels in 2021 as the economic and advertising environments improve. It estimates FOCF will be around $60 million in 2021. Advertisers have already pulled back on their spending. Given the short lead times for broadcast radio advertising, U.S. radio broadcasters began feeling the negative effects of the virus' spread in March. Cumulus' same-station revenue growth was pacing in the low-single-digit percent area through February, but declines in March caused total revenue to decline 11.2% in the first quarter of 2020 (also hurt by the cancellation of the NCAA basketball tournament, for which it has the exclusive national rights). While there is limited visibility for the second quarter and remainder of 2020, Cumulus' second quarter revenue was pacing down in the low-40% area as of mid-May. S&P expects lower consumer confidence and spending because of the current recession will cause industry-wide broadcast radio advertising revenue to decline by 23.5% in 2020. It expects the steepest declines in spending to occur in the second and third quarters of 2020 with a modest improvement in the fourth quarter. While the rate of the virus' spread and its potential peak is uncertain, S&P expects it to peak about midyear and anticipates that it will be followed by a U-shaped recovery in the second half of 2020. The negative outlook reflects the potential that steeper-than-expected declines or a delayed recovery in radio advertising could cause Cumulus' cash flow to remain depressed in 2021. "We could lower the rating if declines in radio advertising are more severe than we expect or if recovery in radio advertising is delayed, causing Cumulus' cash flow to remain depressed in 2021 and beyond. This would diminish Cumulus' liquidity position and hinder its ability to reduce leverage back below 6x," S&P said. "We could revise the outlook to stable if radio advertising revenue shows growth, enabling Cumulus to generate positive cash flow. An outlook revision to stable would also require our expectation that cash flow would sequentially improve, enabling the company to reduce leverage back below 6x in 2021," the rating agency said. DISCOVERORG HOLDINGS: S&P Places 'B-' ICR on Watch Positive ----------------------------------------------------------- S&P Global Ratings placed all of its ratings on DiscoverOrg Holdings LLC (doing business as Zoominfo), including the 'B-' issuer credit rating on the company, on CreditWatch with positive implications to reflect the lower leverage once its debt is repaid. Zoominfo raised $1.075 billion of proceeds through its IPO and expects to use the proceeds to repay its $35 million outstanding revolving credit facility balance and repay in full its $370 million second-lien term loan and $274 million preferred shares. "The CreditWatch placement reflects our view that the planned use of proceeds from the IPO will contribute to a material reduction in Zoominfo's adjusted debt to EBITDA to the high-4x area. We anticipate that the lower debt levels will give Zoominfo more financial flexibility, underpinned by lower interest expense and enhanced cash flow generation, to implement future growth initiatives," S&P said. After the IPO, TA Associates and the Carlyle Group represent roughly two-thirds of the company's shareholder base. "We will resolve the CreditWatch after the proposed debt is fully repaid, at which time we expect to raise our issuer credit rating on DiscoverOrg Holdings LLC by one to two notches and reassess our ratings on the remaining debt issues. Further, we will meet with the company's management team to discuss its future business plans and long-term financial policies," S&P said. DM WORLD: Facing Legal Woes, Files for Chapter 11 Bankruptcy ------------------------------------------------------------ Clarissa Hawes, writing for Freight Waves, reports that Longwood, Florida-based trailer leasing company DM World Transportation LLC sought Chapter 11 protection in middle of May 2020. DM World filed for Chapter 11 two weeks after it filed a motion for final summary judgment in a breach-of-contract lawsuit against the carrier and its CEO Abduvosit Razikov for nearly $1.3 million. U.S. Bankruptcy Judge Lori V. Vaughan granted DM's emergency motion on May 18, 2020 to access its cash to pay approximately $106,000 in wages and medical benefits for its employees and truck drivers. A day before responses to the summary judgment motion in a lawsuit filed against DM World and CEO Abduvosit Razikov were due on May 14, 2020 the court issued an automatic stay after the carrier's attorney, R. Scott Shuker of Shuker & Dorris PA, stated both were planning to file for bankruptcy protection. In October 2020, Texas-based Premier Trailer Leasing Inc. filed a lawsuit against DM World and Razikov, but the trailer leasing company claims it has been unable to serve the complaint to Razikov because he has been "absent from the U.S." since the filing. Premier filed a motion on May 19, 2020 to reopen the case against Razikov because while the company has filed for bankruptcy protection, the former DM World CEO has not. About DM World Transportation DW World Transportation LLC operates as a trucking company. It is a nationwide provider of a variety of transportation services, which include dry van, refrigerated, dedicated, brokerage, and cargo van fleet. It also hauls general freight, fresh produce and mail for the U.S. Postal Service. DM World Transportation, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-02684) on May 12, 2020. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $10 million and $50 million. The Debtor is represented by the Law Firm of Shuker & Dorris, P.A. DUFF & PHELPS: Moody's Affirms 'B3' CFR, Outlook Remains Stable --------------------------------------------------------------- Moody's Investors Service affirmed the following ratings for Deerfield Dakota Holding LLC, a holding corporation that wholly owns Duff & Phelps Corporation: B3 corporate family rating, B3-PD probability of default rating, B2 instrument rating on the senior secured first-lien credit facilities, and Caa2 instrument rating to the senior secured second-lien credit facility. The incremental $300 million first-lien term loan issuance is expected to be fungible with the existing first-lien debt. The outlook is stable. Proceeds from the incremental $300 million issuance will be used to finance the acquisition of a tech-enabled services provider, to repay the existing revolver draw, and to provide additional liquidity. Changes to the proposed capital structure or final terms could result in updates to the ratings or outlook. Issuer: Deerfield Dakota Holding, LLC (NEW) Probability of Default Rating, Affirmed B3-PD Corporate Family Rating, Affirmed B3 Senior Secured 1st Lien Bank Credit Facility, Affirmed B2 (LGD3) Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa2 (LGD6 from LGD5) Outlook Actions: Issuer: Deerfield Dakota Holding, LLC (NEW) Outlook, Remains Stable RATINGS RATIONALE The ratings reflect Duff & Phelps' highly leveraged capital structure with debt/EBITDA above 8.5x (Moody's adjusted, as of March 2020, pro forma for the capital structure after the Stone Point LBO and the proposed $300 million debt issuance). Weak free cash flow to debt, the expectation for debt-funded M&A, and aggressive financial strategies (a key governance consideration under its ESG framework) also weigh on the credit. The firm's appetite for debt has resulted in periods of very high debt/EBITDA after acquisitions, followed by deleveraging as a result of successful integrations. The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook 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. Duff & Phelps' business model will be negatively affected by the global recessionary environment caused by COVID-19. The pandemic will slow down the anticipated deleveraging trend at the time of the recent LBO by new owner Stone Point, but in the long-term Moody's still anticipates credit improvement through organic growth and margin expansion. Duff & Phelps benefits from an established franchise as a provider of a broad range of financial advisory and valuation services to a diversified client base. A well-known brand and entrenched network of customer relationships provide revenue stability. While the majority of client fees are not contractually recurring, a large proportion of existing assignments require periodic reviews, resulting in ongoing contributions to revenue. However, the company faces strong competition against large, well-capitalized peers. Duff & Phelps has reduced its exposure to economic cycles over the last 10 years through acquisitions. Moody's expects the firm's revenue will continue to diversify away from legacy corporate finance advisory fees and will continue to incorporate new services with lower cyclicality. New business lines will benefit from cross-selling opportunities across the company's client base. The proposed acquisition will contribute to Duff & Phelps' non-cyclical technology services revenue stream. The stable outlook reflects the expectation that revenue will grow in the low single-digit percentage range over the next 12 months. The coronavirus pandemic will lead to weakness in the valuation and corporate finance cyclical segments, which will be offset by growth in the cybersecurity and business services segments, as well as contributions from recently acquired assets. Moody's expects leverage will remain very high in 2020 as margins and growth remain under pressure from the COVID-19 recessionary environment. After 2020, margin improvement and stronger growth are expected to result in deleveraging towards 7.5x (Moody's adjusted), in the absence of leveraging transactions. Free cash flow is expected to remain low over the next 12 months due to high transaction and restructuring costs, with FCF/debt in the 1.5% - 3.0% range. The ratings for the individual debt instruments incorporate Duff & Phelps' overall probability of default, reflected in the B3-PD, and the loss given default assessments for the individual instruments. The first-lien credit facilities are rated B2, consisting of the $200 million revolver expiring in 2025, the $1,550 million term loan maturing in 2027 (including a EUR300 Euro tranche), and the proposed incremental $300 million term loan, one notch above the B3 CFR, with a loss given default assessment of LGD3. The B2 first-lien instrument ratings reflect their relative size and senior position ahead of the second-lien senior secured term loan. The $450 million second-lien senior secured term loan, due 2028, is rated Caa2, two notches below the CFR, with a loss given default assessment of LGD6. The Caa2 second-lien senior secured rating reflects its junior ranking as well as its relative size within the capital structure. Duff & Phelps has good liquidity, supported by a $120 million pro forma cash balance at closing of the proposed acquisition financing, a $200 million revolving facility (undrawn at closing) and expected FCF/debt in the 1.5% - 3.0% range. The revolver includes an 8x first-lien springing senior secured leverage covenant when 35% or more of the revolver is drawn. The company is expected to remain in compliance with the covenant. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade is unlikely over the next 12 months due to the recessionary macroeconomic environment caused by COVID-19, which will negatively affect growth and margins. In the longer term, the ratings could be upgraded if the company demonstrates a commitment to more balanced financial policies, sustaining its debt to EBITDA ratio below 6.0x and EBITDA less capex to interest ratio above 2.0x, combined with good liquidity and free cash flow to debt above 5% (all metrics Moody's adjusted). Increasing scale and evidence of strong and sustainable organic revenue growth and improving margins would benefit credit metrics and create upward rating momentum. Duff & Phelps' ratings could be downgraded if the recessionary environment caused by COVID-19 deteriorates, extending the expected timeline to delever and weakening the company's liquidity position. The ratings could also be downgraded if increased competition or cyclical pressure result in declining revenue and lower profitability. Aggressive financial policies or debt-financed acquisitions leading to the expectation that debt to EBITDA will be sustained above 7.5x without a path to deleveraging, EBITDA less capex to interest will decline below 1.0x, or free cash flow to debt will become negative (all metrics Moody's adjusted), or a material weakening in the company's liquidity position, would also pressure the ratings. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Deerfield Dakota Holding, LLC is the holding company of Duff & Phelps, a global consulting services firm. Duff & Phelps operates in four main business segments: valuation advisory; governance, risk, investigations and disputes; corporate finance; and business services. The company generated approximately $1.2 billion of revenue in 2019. The company was acquired in April 2020 by private equity sponsors Stone Point Capital (majority owner) and Further Global. DURA AUTOMOTIVE: Sold in $65 Million Deal With Bardin Hill ---------------------------------------------------------- Peg Brickley, writing for The Wall Street Journal, reports that car parts manufacturer Dura Automotive Systems LLC, long managed by Lynn Tilton, completed a $65 million bankruptcy deal with leading lender Bardin Hill Investment Partners LP in May 2020. The judge who presided on the case approved its sale to senior lender Bardin Hill, which took control of Dura in exchange for the cancellation of $65 million in debt. According to the Journal report, creditors are seeking answers about the decline of Dura, which 19 months ago attracted buyout interest at prices that topped $400 million. Finding out what happened to Dura will fall to a chapter 7 trustee. A bankruptcy trustee will be tasked with deciding whether to sue Ms. Tilton and her Patriarch Partners LLC management company in handling the affairs of, as part of the agreement Bardin Hill reached with creditors. According to court papers, in December 2019, potential buyers walked away after its earning numbers declined by as much as half. During the failed sale process, Ms. Tilton collected $485,000 in management fees and charged Dura more than $1.4 million for legal fees. Leading sale hearing on May 12, 2020 in the U.S. Bankruptcy Court in Wilmington, Del., Bardin Hill came to terms with an official committee of unsecured creditors and with the Zohar funds, lenders previously run by Ms. Tilton that are owed about $105 million by Dura. In an additional concession, Bardin Hill is increasing the amount of its credit bid by $10 million. In the original proposal, the deal called for Bardin Hill to cancel only $55 million of the $87 million loans it had made to Dura and to secure the right to sue Ms. Tilton. To settle concerns raised by Dura's creditors, Bardin Hill agreed to hand over the right to pursue claims against Ms. Tilton, who has been Dura's chief executive for years. The company's creditors filed court papers agreeing to the sale and said that Bardin Hill played the role of "white knight" by stepping up to preserve Dura and thousands of jobs. However, they said that Ms. Tilton should be called to answer for what happened to the company. On May 12, 2020 in court, Ms. Tilton's lawyer Albert Hogan said allegations she had interfered in the sale process and mistreated Dura were "unsupported" and part of a smear campaign. "Ms. Tilton's been attacked unfairly," he said. In court papers, Ms. Tilton blamed the failure of Dura to find an outside buyer on "awful judgment" by the Zohar funds. The claims of creditors against Ms. Tilton have been filed in the bankruptcy court under seal and out of public view. A liquidation trustee will decide whether to move ahead with those allegations once the bankruptcy case is converted to a chapter 7 proceeding. Dura and its European operations will survive bankruptcy due to the support from customers such as Ford Motor Co. The COVID-19 pandemic shutdown has Dura in mothballs, but the company is still an essential part of the supply chain for Ford and others in the auto industry. About Dura Automotive Systems Dura Automotive Systems, LLC, together with its affiliates, is an independent designer and manufacturer of automotive systems, including mechatronic systems, exterior systems, and lightweight structural systems, among others. It is nationally certified in the United States by the Women's Business Enterprise Council, and operates 25 facilities in 13 countries throughout North America, South America, Europe and Asia. Headquartered in Auburn Hills, Mich., the company -- https://www.duraauto.com/ -- employs approximately 7,400 individuals. Dura Automotive Systems sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn. Lead Case No. 19-06741) on Oct. 17, 2019. At the time of the filing, the Debtors had estimated assets of between $100 million and $500 million and liabilities of between $100 million and $500 million. The cases have been assigned to Judge Randal S. Mashburn. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as bankruptcy counsel; Bradley Arant Boult Cummings LLP as local counsel; Portage Point Partners, LLC as restructuring advisor; Jefferies LLC as financial advisor and Investment banker; and Prime Clerk LLC as claims agent. FARADAY FUTURE: Founder Bankruptcy Exit to Pave Way for Financing ----------------------------------------------------------------- Chinese technology mogul Jia Yueting received U.S. Bankruptcy Court approval of a Chapter 11 plan to restructure his debt. Becky Yerak, writing for Wall Street Journal, reports that on May 21, 2020, Judge Vincent Zurzolo, of the U.S. Bankruptcy Court in Los Angeles, confirmed Mr. Jia's chapter 11 plan after a roughly 45-minute hearing with a handful of objections. Mr. Jia filed for bankruptcy in October 2019 to restructure his debts, incurred mostly over personal guarantees for businesses he operated in his homeland. He is also founder and chief product officer of Los Angeles-based Faraday. His bankruptcy differs from many others in that much of his plan revolves around granting creditors interests in a trust that will include his stake in Faraday, which itself is financially distressed. The creditors will be paid if the startup goes public or is sold. According to a court filing, creditors are expected to recover anywhere between 12% to 62% on their claims, that are estimated between $3.5 billion and $7.9 billion. The chapter 11 plan, supported by the official committee of unsecured creditors, is expected to take effect in June 2020. Mr. Jia has said that confirmation of his plan will help the company raise financing and re-establish normal relations with suppliers and others. The new coronavirus pandemic has taken a toll on the value of those patents, a court filing said. In May 2020, Houlihan Lokey Financial Advisors Inc. estimated that the value of Faraday's patent portfolio ranges from about $19 million to $30 million. That's a drop of more than 40% from last year, a trend that Houlihan attributes mostly to COVID-19. Houlihan said, however, that much of the patent portfolio is more valuable if it supports Faraday's technology assets—including prototypes, research and development, and designs and specifications—than it would be if sold as a standalone portfolio of patents. A Faraday spokesman said the Houlihan valuation assumes a worst-case scenario, such as if Faraday needed to sell all of the patents quickly. He said the number of patents being incorporated into Faraday products continues to rise. About Faraday Future Faraday Future (FF) -- https://www.ff.com/ -- is a California-based global shared intelligent mobility ecosystem company focusing on building the next generation of intelligent mobility ecosystems. Established in May 2014, the company is headquartered in Los Angeles with R&D Center and Futurist Testing Lab, and offices in Silicon Valley, Beijing, Shanghai, and Chengdu. FF is poised to break the boundaries between the Internet, IT, creative, and auto industries with product and service offerings that integrate new energy, AI, Internet, and sharing models, that aim to continuously transform the mobility of mankind. About Yueting Jia Yueting Jia is the founder of Leshi Holding Group and the CEO of Faraday Future. Yueting Jia sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 19-12220) on Oct. 14, 2019. The Debtor is represented by James E. O'Neill, Esq., at Pachulski, Stang, Ziehl & Jones LLP. FOODFIRST GLOBAL: Hires Rosenfield and Company as Tax Accountants ----------------------------------------------------------------- FoodFirst Global Restaurants, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Middle District of Florida to employ the accounting firm of Rosenfield and Company, PLLC, as their tax accountants. The professional services Rosenfield is to render are: (a) preparation of the 2019 federal and state tax returns for the Debtors; (b) tax planning and consultation; and (c) general accounting advice as needed. Rosenfield will charge an estimated $75,000 to prepare any applicable state tax filing forms and the Form 1120S - U.S. Income Tax Return for an S Corporation and all supporting Schedules for the fiscal year ended December 2019 and an additional $4,000 for each federal NOL Carryback available under The CARES Act. A retainer of $37,500 is due upon the engagement of Rosenfield. The firm can be reached through: Kenneth R. Rosenfield, CPA Rosenfield and Company, PLLC Capital Plaza II 301 E. Pine Street, Suite 975 Orlando, FL 32801 Phone: 407-849-6400 Fax: 407-849-6700 About FoodFirst Global Restaurants FoodFirst Global Restaurants, Inc. is the parent company for two of America's Italian restaurant brands: BRIO Tuscan Grille and BRAVO Cucina Italiana. It was formed in 2018 by investment firm GP Investments, Ltd and a group of entrepreneurial investors. Visit https://www.foodfirst.com/index.html for more information. FoodFirst Global Restaurants and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Lead Case No. 20-02159) on April 10, 2020. At the time of the filing, Debtors disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Karen Jennemann oversees the cases. Shuker & Dorris, P.A. is Debtors' legal counsel. The U.S. Trustee for Region 21 appointed a committee to represent unsecured creditors. The committee is represented by Pachulski Stang Ziehl & Jones LLP. FREEMAN MOBILE: Files for Chapter 11 Due to High Debt, Pandemic --------------------------------------------------------------- Brian Bandell, writing for South Florida Business Journal, reports that Fort Lauderdale-based orthodontics company Freeman Orthodontics sought Chapter 11 protection with over $10 million worth of liabilities. According to the report, the coronavirus pandemic brought challenges for Freeman because patients had been hesitant to visit medical offices to prevent contracting the virus but the financial woes it experienced began even before COVID-19 pandemic. In January 2020, The Woodlands, Texas-based Woodforest National Bank filed a $6.9 million lawsuit against Freedman Orthodontics and loan guarantors Christopher Scott Freeman, Wayne Pearson and Jeffrey Wilson over a loan securing the commercial assets of the business. Freeman Orthodontics sought chapter 11 protection together with five other related entities. The same day, Christoper Scott Freeman, the lead orthodontics at the practice, filed personal Chapter 11. He listed some of the business debts, including four bank loans worth $12.6 million, as his personal debts, as well. His total liabilities were about $13 million. Boca Raton attorney Aaron Wernick, who represents the debtors in all seven cases, said the businesses are preparing a plan to restructure all of their collective debts. "It was determined that implementing this financial restructuring plan through a court-supervised process was the best path to ensure that Freeman Orthodontics and its affiliated businesses will build on their over 15-year history to serve their patients and communities for decades to come. They are continuing to serve their patients as they move through this process, and will continue to provide the same exceptional level of service and product that they are known for. They look forward to emerging from this restructuring as a stronger organization, continuing to innovate, provide high-quality patient care, and focus on satisfying customers’ wants and needs," Wernick said. Freeman, Pearson and Wilson co-founded Swanky Smiles, a mobile orthodontics business with vans that visit customers, in 2017. It offers appointments 15 hours a day, seven days a week. The website claims the process saves patients time. Of the six companies that filed Chapter 11, Freeman Orthodontics had the most liabilities worth $10.5 million. None of the petitions listed the assets of the companies, although they did have real estate holdings. Freeman Holdings owns the office in Plantation, Freeman Holdings II owns the office in Fort Lauderdale, and FWP Realty Holdings owns the office in Springdale. The Coral Springs office is leased from a third party. The loans listed in the petitions include: * $6.9 million from Woodforest National Bank. * $5 million from the Maclellan Foundation in Chattanooga, Tennessee. * $2.9 million from Rogers, Arkansas-based Arvest Bank to secure equipment. * $1.7 million from Bank of America, securing the 10,751-square-foot office at 1825 N.E. 45th St., Suite A in Fort Lauderdale, and the 2,316-square-foot office at 8200 W. Sunrise Blvd., Suite B-3, in Plantation. * $1.3 million from Arvest Bank to secure an office at 803 Quandt Ave. in Springdale. * $200,000 from the Francis E. McEvoy and Joanne Morgan trust as a second mortgage on the Springdale office. * $270,558 with American Express. * $250,000 from GM Financial for several vehicles. Morever, San Jose, California-based Align Technology had a $2.4 million claim as a vendor. There were also claims of $278,412 from Facebook and $239,400 from Salesforce. Seven individuals made personal loans ranging from $150,000 to $200,000 to Interstellar Disruption. About Freeman Orthodontics Freeman Orthodontics is a Fort Lauderdale-based orthodontics specialist that provides cutting-edge, high quality and friendly orthodontic care to patients in different communities in Florida. It takes price in providing patients with specialized and personalized service because it recognizes the different needs of patients. It features the newest technological advances in dental industry like brackets, braces, clear aligners, accelerated orthodontics, and many more. Freeman Mobile Orthodontics PLLC and affiliate Freeman Orthodontics, P.A., sought Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 20-15408) on May 17, 2020. Affiliates Interstellar Disruption LLC, Freeman Holdings LLC, Freeman Holdings II LLC and FWP Realty Holdings also sought bankruptcy protection. On May 17, 2020, Christoper Scott Freeman, the lead orthodontics at the practice, also filed a personal Chapter 11 case. He $13 million in liabilities, including four bank loans worth $12.6 million. The Hon. Scott M. Grossman is the case judge. The Debtors are represented by: Aaron A Wernick Wernick Law, PLLC Tel: 561-961-0922 E-mail: awernick@wernicklaw.com FRONTIER COMMUNICATIONS: Unsecureds to Be Reinstated in Plan ------------------------------------------------------------ Frontier Communications Corporation and its debtor affiliates filed with the U.S. Bankruptcy Court for the Southern District of New York a Joint Plan of Reorganization and a Disclosure Statement. In October 2019, Frontier embarked on a proactive engagement with two ad hoc creditor groups holding over 75 percent of Frontier's senior unsecured notes (such creditors, the Consenting Noteholders). After months of hard-fought negotiations, Frontier commenced its chapter 11 cases on April 14, 2020 with key creditor support from the Consenting Noteholders for a comprehensive transaction, as contemplated in the agreement between the Debtors and the Consenting Noteholders. Since the Petition Date, the Debtors have worked with the Consenting Noteholders to memorialize the terms set forth in the Restructuring Support Agreement through the Plan. The Plan provides for a comprehensive restructuring of the Debtors' obligations, preserves the going-concern value of the Debtors' business, maximizes recoveries available to all constituents, and preserves thousands of jobs. If confirmed and consummated, the Plan will substantially delever the Debtors' balance sheet by over $10 billion in funded debt obligations and contemplates the following key terms: * Holders of general unsecured claims will be paid in full, reinstated, or otherwise unimpaired; * Holders of secured debt will be repaid during these Chapter 11 Cases, paid in full on the effective date of a plan of reorganization, or reinstated; * Holders of Senior Notes will receive their pro rata share of 100 percent of the common stock (subject to dilution by the Management Incentive Plan) of Reorganized Frontier, $750 million of Takeback Debt on either a third lien or a to-be-agreed-upon basis depending on treatment of the second lien notes under a plan, and unrestricted cash of Reorganized Frontier in excess of $150 million as of the Effective Date; and * Holders of certain secured and unsecured notes held by the Debtors’ subsidiaries will be reinstated or paid in full on the Effective Date. On April 14, 2020, the Debtors and the Consenting Noteholders entered into the Restructuring Support Agreement. Since executing the RSA, the Debtors have further documented the terms of the restructuring, including the Plan. The restructuring transactions contemplated by the Plan will reduce overall leverage through the equitization of approximately $10 billion of the Senior Notes. On or before the Effective Date, the applicable Debtors, with the consent of the Required Consenting Noteholders, or Reorganized Debtors will take any action as may be necessary or advisable to effectuate the Restructuring Transactions described in the Plan and Restructuring Transactions Memorandum. The Debtors will fund distributions under the Plan with: (i) Excess Cash, (ii) the New Common Stock, and (iii) the Takeback Debt or third-party market financing, as applicable. The Reorganized Debtors will be entitled to transfer funds between and among themselves as they determine to be necessary or appropriate to enable the Reorganized Debtors to satisfy their obligations under the Plan. A full-text copy of the Disclosure Statement dated May 15, 2020, is available at https://tinyurl.com/ybyljsjt from PacerMonitor at no charge. The Debtors are represented by: Stephen E. Hessler, P.C Mark McKane, P.C. Patrick Vente KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 - and - Chad J. Husnick, P.C. Benjamin M. Rhode KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Street Chicago, Illinois 60654 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 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. GAMESTOP CORP: S&P Rates New Secured Notes 'B-' ----------------------------------------------- S&P Global Ratings assigned its 'B-' issue-level and '3' recovery ratings to Texas-based GameStop Corp.'s proposed secured notes. The '3' recovery rating reflects its expectation for meaningful recovery (50%-70%; rounded estimate: 50%) in the event of a default. At the same time, S&P lowered the rating on the existing unsecured notes to 'CCC+' from 'B-' and revised the recovery rating to '5' from '3'. The '5' recovery rating indicates S&P's expectation for modest recovery (10%-30%; rounded estimate: 15%) due to the addition of secured debt in the capital structure offset by value from the unpledged collateral from international operations. S&P also affirmed its 'B+' issue-level and '1' recovery ratings (90%-100%; rounded estimate: 95%) on the company's ABL facility. GameStop launched an exchange offer for its approximately $415 million in unsecured notes due in March 2021 in a par-for-par transaction for newly issued secured notes. S&P expects the contemplated transaction will help improve the company's debt maturity profile while maintaining liquidity if a significant amount of notes are exchanged. S&P's ratings reflect its base-case assumption that the proposed exchange offer results in a substantial majority of existing notes being tendered for the secured notes. In addition, the inability to exchange a significant portion of unsecured debt (estimated at about 60% or less) could result in S&P reassessing its issue-level and recovery ratings. S&P also anticipates revisiting its 'B-' issuer credit rating on GameStop if the company does not complete the transaction consistent with the rating agency's base-case. It could also revisit the ratings if operating performance deteriorates or activist shareholder influence results in a shift in the approach to refinancing the unsecured notes. S&P's 'B-' issuer credit rating and developing outlook on GameStop reflect the continued uncertain operating environment and near-term maturities that could limit the company's ability to invest in its business repositioning strategy if not largely refinanced. S&P believes GameStop's physically based video game sales will remain weak for most of the year, but should increase significantly when new gaming consoles launch, which the rating agency expects in the fourth quarter. It also thinks consumers will curb discretionary spending in the fragile economic environment into 2021. The rating agency also believes GameStop will maintain the capacity to pay down debt as it was in a net cash position as recently as the last fiscal quarter. It expects full-year positive free operating cash flow benefiting from the new console launch. It believes the proposed exchange offer represents adequate offsetting compensation at an anticipated higher interest rate and security for noteholders who choose to exchange. Therefore, S&P does not consider the proposed transaction to be a distressed exchange. GRANITE CITY: Selling Two Liquor Licenses for $15K Each ------------------------------------------------------- Granite City Food & Brewery, and its affiliates ask the U.S. Bankruptcy Court for the District of Minnesota to authorize the sale of their Indianapolis liquor license to Robert H. Stark for $15,000, and their Mishawaka liquor licenses to R&P Resources, Inc. for $15,000. Both before and after the Petition Date, the Debtors closed certain underperforming restaurant locations. Although the Court entered an order approving sales of substantially all of their assets, those sales did not include the liquor licenses for Closed Locations. The Closed Locations include a location at 49 West Maryland Street, Indianapolis, Indiana; and a location at University Park Shopping Center, 6501 Grape Road, Mishawaka, Indiana. For the Indianapolis Location, the Debtors hold a Type 210, City of Indianapolis, Marion County alcoholic beverage permit, Permit No. RR49-28602. For the Mishawaka Location, the Debtors held a Type 210, City of Mishawaka, St. Joseph County alcoholic beverage permit, Permit No. RR7135474. Through a broker at the consulting firm of Bradford & Riley, the Debtors have found buyers for the Liquor Licenses. Stark has offered to purchase the Indianapolis Liquor License for $15,000. Stark and the Debtors have entered into a purchase agreement for the Indianapolis Liquor License subject to court approval. Stark has submitted a Declaration to state that his qualifications to hold a liquor license under Indiana law, specifically Indiana Code 7.1-3-4-2 and 7.1-3-24-8. R&P has offered to purchase the Mishawaka Liquor License for $15,000. R&P and the Debtors have entered into a purchase agreement for the Mishawaka Liquor License subject to court approval. Carl Dissette has submitted a Declaration to state that R&P's qualifications to hold a liquor license under Indiana law, specifically Indiana Code 7.1-3-4-2 and 7.1-3-24-8. The Debtors have not received any other offers for the Liquor Licenses. Considering the large number of restaurant bankruptcy cases during the past few years and the economic headwinds facing the restaurant industry due to the COVID-19 pandemic, the Debtors believe that these are the best offers available for the Liquor Licenses. Gregory T. Genrich, of Bradford & Riley, is familiar with the market for liquor licenses due to his experience as a broker assisting with the purchase or sale of dozens of liquor licenses. Mr. Genrich has executed affidavits stating his opinion that the purchase prices constitute current fair market value considering that the market has collapsed due to COVID-19. Citizens Bank holds a security interest in the Liquor Licenses due to its blanket lien against all the property of the Debtors. Citizens Bank consents to the sale as long as its liens attach to the sale proceeds. The Debtors ask entry of an order approving the sale of the Liquor Licenses with valid liens to attach to sale proceeds. They further ask that the Court directs the Indiana Alcohol and Beverage Commission to allow the transfer of the licenses from the Debtors to the Purchasers, subject to any requirements of the Indiana Code. They further ask that they be authorized to pay commissions to the broker out of sale proceeds. Finally, the Debtors ask that the 14-day stay of Rule 6004(h) be waived so that the sale may be effected immediately. A hearing on the Motion was set for June 2, 2020 at 1:30 p.m. the objection deadline was May 28, 2020. A copy of the Contracts is available at https://tinyurl.com/yb57tsc4 from PacerMonitor.com free of charge. Granite City Food & Brewery Ltd. (OTCPink: GCFB) -- http://www.gcfb.com/-- operates two casual dining concepts: Granite City Food & Brewery and Cadillac Ranch All American Bar & Grill. The Granite City concept features its award-winning signature line of hand-crafted beers finished on-site as well as local and regional craft beers from brewers in various markets. In addition, these casual dining restaurants offer a wide variety of menu items that are prepared fresh daily. The extensive menu features contemporary American fare made in its scratch kitchens. Granite City opened its first restaurant in 1999; there are currently 25 Granite City restaurants in 13 states. Cadillac Ranch restaurants feature freshly prepared, authentic, All-American cuisine in a fun, dynamic environment. Its patrons enjoy a warm, Rock N' Roll inspired atmosphere. The Cadillac Ranch menu is diverse with offerings ranging from homemade meatloaf to pasta dishes, all freshly prepared using quality ingredients. The company currently operates 4 Cadillac Ranch restaurants in four states. Granite City Food & Brewery and four affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Minn. Lead Case No. 19-43756) on Dec. 16, 2019. At the time of the filing, Granite City Food & Brewery disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge William J. Fisher oversees the cases. James M. Jorissen, Esq., at Briggs & Morgan, PA, is the Debtors' legal counsel. H.R.P. II: Amends Sale Agreement to Extend Transport Due Diligence ------------------------------------------------------------------ Debtor H.R.P. II, LLC, filed a Disclosure Statement for the Third Amended Chapter 11 Plan of Reorganization dated May 15, 2020. On December 17, 2019, the Court entered an order granting the Motion to Sell and approving the Debtor's proposed sale of the Property to Transport Properties LLC (the Purchaser) for $1,200,000 pursuant to the terms and conditions of that certain Agreement of Purchase and Sale dated November 15, 2019 (the Sale Agreement). Pursuant to the Sale Agreement, Purchaser placed a $25,000 refundable earnest money deposit in escrow with Chicago Title. The Sale Agreement has been amended to extend the Purchaser's due diligence period, including pursuant to the Fourth Amendment to Purchase and Sale Agreement dated February 20, 2020 (the Fourth Amendment). The Purchaser paid the Debtor a $15,000 non-refundable extension fee in connection with the Fourth Amendment. Under the Sale Agreement, as amended, the Purchaser has until May 22, 2020 to complete due diligence, with the right to extend the due diligence period for an additional 30 days by providing notice to the Debtor and paying an additional $5,000 extension fee and an additional $15,000 earnest money deposit. Upon the expiration of the due diligence period, the closing of the sale must occur within 60 days. The aforementioned Order to Demolish with respect to the building located on the property owned by the Debtor and H.R.P., LLC has been disclosed to the Purchaser and factored into the purchase price set forth in the Sale Agreement. A full-text copy of the third amended plan of reorganization dated May 15, 2020, is available at https://tinyurl.com/y9ekxtpv from PacerMonitor at no charge. Counsel for H.R.P. II: Gordon E. Gouveia II Fox Rothschild LLP 321 North Clark Street, Suite 1600 Chicago, Illinois 60654 Tel: (312) 980-3816 E-mail: ggouveia@foxrothschild.com About H.R.P. II LLC H.R.P. II LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ind. Case No. 17-21695) on June 15, 2017. At the time of the filing, the Debtor was estimated assets of less than $1 million and liabilities of less than $500,000. Judge James R. Ahler oversees the case. Fox Rothschild LLP is the Debtor's bankruptcy counsel. HADDAD RESTAURANT: Landlord Buying Overland Park Assets for $116K ----------------------------------------------------------------- Haddad Restaurant Group, Inc., asks the U.S. Bankruptcy Court for the District of Kansas to authorize the sale of the personal property and fixtures at the Plaza III Steakhouse located at 12631 Metcalf Avenue, Overland Park, Kansas to its Landlord, New Metcalf, LLC, $116,250. The Debtor operates a Plaza III Steakhouse located at 12631 Metcalf Avenue, Overland Park, KS 66213. COVID- 19 has resulted in significant financial difficulties for the Debtor. The Debtor stopped operations because of State of Kansas orders. The Court previously granted orders authorizing, but not requiring the sale of personal property at auction, but the Debtor has reached an agreement with its Landlord and believes that the highest and best price can be obtained in a bulk sale to the Landlord. After exploring its alternatives, the Debtor has determined that the sale of the assets is the best method for satisfying creditors when considering the time constraints imposed by the Debtor’s creditors and the Bankruptcy Code. It proposes to sell the Assets pursuant to the Sale and Purchase Agreement to New Metcalf free and clear of all liens, interests, and encumbrances for $116,250. The Debtor believes that the sale is in the best interests of the Chapter 11 estate and its creditors, is proposed in good faith, and is fully justified. All proceeds of the sale of said assets will be held in a segregated DIP bank account at Citizens Bank & Trust pending further Order of the Court. A copy of the Agreement is available at https://tinyurl.com/yby7hz73 from PacerMonitor.com free of charge. About Haddad Restaurant Group Haddad Restaurant Group, Inc., operates a Plaza III Restaurant located in Overland Park, Kansas. The company filed a Chapter 11 petition (Bankr. D. Kan. Case No. 20-20282) on Feb. 24, 2020. At the time of the filing, the Debtor had cash and bank balances, and account receivables of approximately $20,000. Evans & Mullinix, P.A., is the Debtor's counsel. HALS REALTY: Seeks to Hire DuBosar Law Group as Special Counsel --------------------------------------------------------------- Hals Realty Associates Limited Partnership seeks authority from the US Bankruptcy Court for the Southern District of Florida to employ The DuBosar Law Group, P.A. as its special counsel. DuBosar Law Group, P.A. will provide legal advice to the Debtor in connection with pending state court action in the 15th Judicial Circuit Court of Palm Beach County, case style S.M.S.CO vs. Hals Realty Associates Limited Partnership, case no: 502017CA001448XXXXMBAH. Howard D. DuBosar, Esq. of DuBosar Law Group has represented the Debtor since the commencement of the pending state court action and received a pre-petition retainer of $25,000 to provide professional services. The Debtor will compensate Mr. DuBosar at a hourly rate of $550. Mr. DuBosar assures the court that he and his firm are disinterested as required by 11 U.S.C. Sec. 327(a) and a verified statement as required under Bankruptcy Rule 2014. Mr. DuBosar can be reached at: Howard D. DuBosar, Esq. The DuBosar Law Group, P.A. 3010 N Military Trl STE 210 Boca Raton, FL 33431 Phone: +1 561-544-8980 About Hals Realty Associates Hals Realty Associates Limited Partnership sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-13103) on March 5, 2020. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $10,000,001 and $50 million. Judge Mindy A. Mora oversees the case. Furr and Cohen, P.A. is Debtor's legal counsel. HALS REALTY: Seeks to Hire GlassRatner as Forensic Accountant ------------------------------------------------------------- Hals Realty Associates Limited Partnership seeks authority from the US Bankruptcy Court for the Southern District of Florida to employ Glass Ratner Advisory & Capital Group, LLC, as its forensic accountant and financial advisor. The professional services Glass Ratner will render are: a. give advice to the Debtor with respect to its powers and duties as debtor-in-possession and the continued management of its business operations; b. advise the Debtor with respect to its finances and to guide the Debtor in making sound financial decisions for its operations in order to ensure that the Debtor reaps the benefits of reorganization and will be able to continue its operations and to comply with the rules of the Court; c. prepare financial documents for the Debtor's edification and use in making sound financial decisions, and other documents as necessary for the success of the Debtor's Chapter 11 case; d. protect the financial interests of the Debtor in all matters pending before the Court; e. provide financial advice to the Debtor in negotiation with its creditors and in the preparation of a confirmable plan. Glass Ratner's hourly rates are: Alan R. Barbee, Principal $475 Sr. Managing Directors $375 - $395 Directors/Managing Directors $295 - $335 Associates $225 - $295 The Debtor seeks authorization to pay the Glass Ratner a post-petition retainer of $20,000. Alan R. Barbee, pricipal of GlassRatner Advisory & Capital Group 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. Glass Ratner can be reached at: Alan R. Barbee, CPA Glass Ratner Advisory & Capital Group, LLC 1400 Centrepark Boulevard, Suite 860 West Palm Beach, FL, 33401 Email: abarbee@glassratner.com About Hals Realty Associates Hals Realty Associates Limited Partnership sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-13103) on March 5, 2020. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $10,000,001 and $50 million. Judge Mindy A. Mora oversees the case. Furr and Cohen, P.A. is Debtor's legal counsel. HARRIS COUNTY HSA: S&P Affirms BB+ Rating on Jr.-Lien 2001H Bonds ----------------------------------------------------------------- S&P Global Ratings lowered its rating on Harris County-Houston Sports Authority, Texas' senior-lien series 2001A, 2001G, and 2014A bonds to 'BBB' from 'A-', and its rating on the authority's second-lien series 2014C bonds to 'BBB-' from 'BBB'. At the same time, S&P affirmed its 'BB+' rating on the junior-lien series 2001H bonds, and its 'BB' rating on the third-lien series 2004A-3 bonds. The outlook for all ratings is negative. S&P rates the bonds under its criteria "Priority-Lien Tax Revenue Debt," published Oct. 22, 2018, which factors in both the strength and stability of the pledged revenues, as well as the general credit quality of the authority. "With the onset of the COVID-19 pandemic and social distancing measures implemented in response to the outbreak, economically sensitive pledged revenues--hotel and motor vehicle rental taxes--are expected to fall sharply in 2020, weakening, in our view, the authority's coverage metrics and introducing significant revenue volatility risk in the short-to-medium term," said S&P Global Ratings credit analyst Andy Hobbs. The authority owns sports facilities in the Houston area that are particularly exposed to the negative effects of depressed consumer demand arising out of the COVID-19 pandemic and recession. S&P's analysis of these risks encompasses its review of environmental, social, and governance risks that currently exist. Most notably, the ongoing pandemic and the social risk arising from it have led to social distancing measures implemented and shelter-in-place orders issued by state and local governments in order to limit the virus' spread. As a consequence, demand for hotels and rental cars has fallen, leading to weakening pledged revenue coverage. The authority's facilities did not sustain material damage during Hurricane Harvey, but S&P also acknowledges the environmental risks that Harris County-Houston face as the area is susceptible to future significant weather events. Key credit considerations include: -- Anticipated decline in pledged revenues in 2020 due to the onset of COVID-19 and weakness in the energy sector; -- Unaudited fiscal 2019 pledged tax revenue providing 1.51x, 1.35x, 0.67x, and 0.74x maximum annual debt service (MADS) coverage on the senior-, second-, junior-, and third-lien bonds, respectively; -- The broad and diverse Harris County-Houston metropolitan statistical area (MSA) economy; -- Historically stable growth in pledged revenues; -- The need for pledged tax revenues to increase to cover MADS on the junior- and third-lien bonds; and -- Slow 30-plus year amortization, with 38% payout after 10 years. The negative outlook indicates there is a one-in-three chance S&P could lower the rating as a result of the substantial decline in pledged revenues and subsequent decline in coverage caused by COVID-19, the recession, and weakness in the energy sector. S&P could lower the rating on all bonds if the recession is prolonged, and pledged revenues experience any decrease that materially affects coverage levels. Furthermore, the absence of any revenue growth that results in less than 1.0x coverage on the junior- and third-lien bonds could lead S&P to lower the rating. S&P could revise the outlook to stable if revenues increase and economic growth results in sustained improvement in pledged revenue collections and subsequently debt service coverage levels. HEARTS AND HANDS: June 30 Plan & Disclosure Hearing Set ------------------------------------------------------- On May 11, 2020, Debtor Hearts and Hands of Care, Inc., filed with the U.S. Bankruptcy Court for the District of Alaska a Disclosure Statement and Chapter 11 Plan of Reorganization. On May 15, 2020, Judge Gary Spraker conditionally approved the Disclosure Statement and established the following dates and deadlines: * June 23, 2020, is fixed as the last day to file an objection to the Disclosure Statement, last day for filing and serving written objections to confirmation of the Chapter 11 Plan of Reorganization, and the last day for filing written ballots accepting or rejecting the plan. * June 30, 2020 at 9:30 a.m., in The Herbert A. Ross Historic Courtroom, Old Federal Building, 605 W. 4th Avenue, Anchorage, Alaska is the hearing to consider approval of the debtor’s Disclosure Statement. * June 30, 2020 at 9:30 a.m. is also fixed for the hearing on confirmation of the Chapter 11 Plan of Reorganization. A copy of the order dated May 15, 2020, is available at https://tinyurl.com/y9k85ryq from PacerMonitor at no charge. About Hearts and Hands of Care Hearts and Hands of Care, Inc., is a home and community-based waiver services agency which is certified for and provides waiver-funded services. HHOC provides both habilitative and non-habilitative services to support individuals with a variety of disabilities, as well as their families. The agency provides services to approximately 212 recipients. Hearts and Hands of Care sought Chapter 11 protection (Bankr. D. Alaska Case No. 19-00230) on July 22, 2019. In the petition signed by CEO Kisha Smaw, the Debtor was estimated to have assets of at least $50,000 and liabilities at $1 million to $10 million. Judge Gary Spraker oversees the case. Peyrot and Associates P.C. is the Debtor's legal counsel. HIDALGO EMERGENCY: Seeks to Extend Exclusivity Period to Aug. 4 --------------------------------------------------------------- Hidalgo County Emergency Service Foundation asked the U.S. Bankruptcy Court for the Southern District of Texas to extend the exclusivity periods during which the company can file a Chapter 11 plan and solicit acceptances from creditors to Aug. 4 and Sept. 3, respectively. Hidalgo requested the extension to preserve the status quo until parties can complete the appeal process and have the information they need to conduct meaningful plan negotiations. The extension will also allow the company to continue with both marketing efforts or obtaining alternative financing. Currently, Hidalgo has been engaged in extensive litigation with the United States Small Business Administration regarding the company's attempts to obtain PPP funds under the CARES Act. The litigation is now pending on appeal to the Fifth Circuit Court of Appeals. The case is in the briefing stage and is set for oral arguments on June 29. If Hidalgo is successful in its litigation against the SBA, the PPP funds will greatly advance the reorganization process. About Hidalgo County Emergency Service Foundation Hidalgo County Emergency Service Foundation, which conducts business under the names South Texas Air Med and Hidalgo County EMS, is an Edinburg, Texas-based provider of emergency ambulatory services. Hidalgo County Emergency Service Foundation filed for Chapter 11 bankruptcy protection (Bankr. S.D. Tex. Case No. 19-20497) on Oct. 8, 2019, listing $1 million to $10 million in both assets and liabilities. The petition was signed by Kenneth B. Ponce, sole managing member. Judge David R. Jones oversees the case. Lawyers at Jordan, Holzer & Ortiz, P.C., is the Debtor's legal counsel. No official committee of unsecured creditors has been appointed in the Debtor's case. HILTON GRAND: S&P Downgrades ICR to 'BB' on Travel Decline ---------------------------------------------------------- S&P Global Ratings lowering the issuer credit rating on Hilton Grand Vacations Inc. to 'BB' from 'BB+'. S&P affirmed the 'BBB-' issue-level ratings on the senior secured credit facility, which benefits from very high recovery prospects in a default scenario. In addition, S&P lowered the issue-level rating on the senior unsecured notes to 'BB-' from 'BB'. The downgrade reflects a severe second-quarter decline in revenue and EBITDA, which will probably cause HGV's captive-adjusted leverage to spike in 2020 and potentially improve to the 4x-4.5x range in 2021. HGV ended 2019 with S&P captive-adjusted leverage in the high-2x area, which was already weak compared to S&P's 3x downgrade threshold at the previous 'BB+' rating, and which resulted from VOI sales decline due to lower inventory availability and higher corporate debt balance partly resulting from share repurchases. VOI sales and total revenue will probably drop significantly in the second quarter of 2020 due a collapse in travel demand, temporary closures of timeshare sales centers, and low occupancy at resorts primarily in the second quarter. The anticipated revenue decline in 2020 and uncertainty about the path of recovery reduce S&P's confidence that leverage can be sustained under 3x. S&P preliminarily assumes sales centers can continue to reopen and travel activity can slowly ramp up through the third quarter of 2020 as coronavirus containment is achieved. The recovery path could be challenging due to a weaker economy and higher unemployment. S&P's updated assumption is that net VOI sales fall 35%-45% in 2020, driven by a decline in tour flow and volume per guest (VPG) as timeshare operators reduce product prices. Rental revenue will also probably decline significantly in 2020 due to low resort occupancy for a period of time. The impact could be somewhat offset by less volatile financing and resort and club management revenue, a portion of which recur each period. Based on S&P's assumptions, total revenue excluding cost reimbursements could decline 30%-40% in 2020. Margins will likely deteriorate from pressured timeshare prices and some fixed costs, causing captive-adjusted EBITDA to fall more steeply than revenue. As a result, leverage will likely be very high in 2020. S&P's forecast and rating rely heavily on a recovery in 2021 that, in its view, would need to begin in the second half of 2020 to be on track to achieve our projected level of 2021 EBITDA. If a recovery begins in the second half of 2020, net VOI sales could meaningfully rebound and leverage could plausibly improve to 4x-4.5x in 2021, which would be in line with the 'BB' rating. The CreditWatch partly reflects S&P's forecast range for captive-adjusted leverage in 2021 that is weak compared to its 4.5x downgrade threshold at the 'BB' rating. Compared to peers, HGV's revenue mix is heavily weighted toward the sale of owned VOIs and revenue from fee-for-service sales. S&P expects these revenue streams to be under pressure over the forecast period. In addition, HGV has sizable exposure to Hawaii, a destination market that could be slower to recover. Potential variability in revenue and EBITDA could result from a weaker, more uneven, or elongated recovery path than S&P assumes, which would put incremental pressure on the rating. S&P estimates HGV's liquidity would be adequate for at least 24 months based on the rating agency's revenue and cost assumptions. HGV has stated that as of March 31, 2020, it had sufficient liquidity for about 22 months even under a stressed scenario of no VOI sales or rental revenue. Because it assumes some level of recovery in VOI sales and rental revenue over its forecast period, S&P believes HGV's liquidity runway would be longer than 24 months. Liquidity sources include recurring revenue streams such as financing and resort and club management revenue, as well as cash inflows from cash VOI sales and rentals to the extent they begin to recover in the second half of 2020 based on S&P's assumed timeline for coronavirus containment. Club and resort management revenue includes member fees, of which 90% were already collected for 2020 and are expected to fully fund operating costs of HGV's resorts. HGV had $669 million unrestricted cash, which includes a near full draw on the corporate revolver and $195 million draw on the warehouse facility, and $39 million remaining availability on the revolver as of March 2020. In addition, HGV had unencumbered receivables that could generate $120 million cash using availability under the warehouse facility if needed. The warehouse had remaining capacity of $255 million as of March 2020 to the extent receivables are available. The warehouse facility is typically an interim liquidity source to make new consumer loans, and its usage for operating expenses could reduce availability for future consumer loans. Liquidity uses include cash operating expenses, inventory purchases, capital expenditures (capex), debt amortization, and interest expense. HGV has estimated total liquidity uses to be about $66 million per month under a stressed scenario of no VOI sales and rental revenue. S&P believes HGV could reduce a portion of cash expenses including cash cost of VOI sales, license fee, sales and marketing, and general and administrative costs. S&P also assumes no share repurchases for the remainder of 2020 and in 2021. While financial risk at the captive finance subsidiary will likely increase through 2021, the captive had good leverage cushion entering the travel downturn. Default rates on HGV's timeshare receivables were 5.14% in 2019 and 4.71% in 2018. Default rates will probably be higher in 2020 and 2021 and increase write-offs on vacation ownership loans, which could spike the captive's financial risk. If annual default rates are sustained above 5%, the captive's leverage as measured by adjusted debt to equity could rise to the 2x-3x range. Higher default rates and financial risk at the captive could also result in more cash outlays by HGV, to the extent the parent is motivated to support the credit quality of securitized loans or opportunistically repurchases low-cost timeshare inventory underlying the defaults. Partly offsetting these risk factors is modest captive leverage when the company entered the travel downturn, which was 1.2x adjusted debt to equity as of year-end 2019 based on S&P's measure. Over the past few years, the captive's adjusted debt to equity was 1x-1.5x, which represented significant cushion compared to S&P's 5x downgrade threshold. Over the forecast period, the captive could likely absorb moderate deterioration in loan portfolio quality without impairing HGV's overall financial risk. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety All S&P's ratings on HGV are on CreditWatch, reflecting anticipated significant stress on revenue and cash flow, uncertainty in the path of recovery, and the possibility of rating downside if recovery is weaker than the rating agency assumes. S&P could lower ratings if VPG, tour flow, resort occupancy, or EBITDA margin are weaker than it assumes and cause the rating agency to revise its base case for captive-adjusted leverage to be sustained above 4.5x. S&P could also lower ratings if risk in captive finance operations rises meaningfully enough to impair the parent's financial risk, which the rating agency believes could occur if the captive increases and sustains adjusted debt to equity above 5x, or if annual loan losses in the captive's portfolio increased materially and are sustained above 5%. IMERYS TALC: Unsecured Creditors to Be Paid in Full in Plan ----------------------------------------------------------- Debtors Imerys Talc America, Inc. (ITA), Imerys Talc Vermont, Inc. (ITV), and Imerys Talc Canada Inc. (ITC) filed with the U.S. Bankruptcy Court for the District of Delaware a Joint Chapter 11 Plan of Reorganization and a Disclosure Statement on May 15, 2020. The contemplated filing of Imerys Talc Italy S.p.A. (ITI) is designed to address the Talc Personal Injury Claims against ITI, and ITI's filing is contingent upon acceptance of the Plan by the holders of such Claims. As a result, certain holders of Claims against ITI are being solicited through this Disclosure Statement to vote on the Plan prior to ITI's contemplated chapter 11 filing. In developing the Plan, the Debtors engaged in good-faith, arms'-length negotiations with Imerys S.A., the Tort Claimants' Committee, and the FCR. The Debtors are pleased to report that, subject to the terms of the letters accompanying this Disclosure Statement, both the Tort Claimants' Committee and the FCR support the Plan and are Plan Proponents. The North American Debtors commenced their Chapter 11 Cases in order to manage the significant potential liabilities arising from claims by plaintiffs alleging personal injuries caused by exposure to talc mined, processed and/or distributed by one or more of the North American Debtors. As of the Petition Date, one or more of the North American Debtors had been sued by approximately 14,650 claimants seeking damages for personal injuries allegedly caused by exposure to the North American Debtors’ talc products, with the vast majority of such claims (approximately 98.6%) based on alleged exposure to cosmetic talc products. A Talc Personal Injury Trust will be established and assume all Talc Personal Injury Claims. The Talc Personal Injury Trust will be funded with the Talc Personal Injury Trust Assets in order to resolve Talc Personal Injury Claims in accordance with the Talc Personal Injury Trust Documents. The Plan also contemplates a section 363 sale process, by which the assets of the North American Debtors will be marketed to third parties pursuant to a court-approved sale process. The net proceeds from the Sale will be used to fund the Talc Personal Injury Trust. To resolve the Debtors' Talc Personal Injury Claims the Plan incorporates a global settlement between the Plan Proponents. The Plan contemplates the establishment of a Talc Personal Injury Trust that will assume all Talc Personal Injury Claims and resolve Talc Personal Injury Claims in accordance with the Talc Personal Injury Trust Documents. Class 3a Unsecured Claims Against the North American Debtors will each be paid the allowed amount of its unsecured claim. Such payment will be (i) in full, in Cash, plus post-petition interest at the federal judgment rate in effect on the Petition Date, or (ii) upon such other less favorable terms as may be mutually agreed upon between the holder of the Unsecured Claim and the applicable North American Debtor or Reorganized North American Debtor. Class 3b Unsecured Claims Against ITI are unaltered by the Plan. Except to the extent that a holder of an Unsecured Claim against ITI agrees to a different treatment, on and after the Effective Date, Reorganized ITI will continue to pay or dispute each Unsecured Claim in the ordinary course of business in accordance with applicable law. Class 4 Talc Personal Injury Claims will be channeled to and assumed by the Talc Personal Injury Trust without further act or deed and shall be resolved in accordance with the terms and procedures of the Talc Personal Injury Trust and the Trust Distribution Procedures. Pursuant to the Plan and the Trust Distribution Procedures, each holder of a Talc Personal Injury Claim shall have its Claim permanently channeled to the Talc Personal Injury Trust, and such Claim shall thereafter be asserted exclusively against the Talc Personal Injury Trust and resolved and paid by the Talc Personal Injury Trust in accordance with the Trust Distribution Procedures. Class 6 Equity Interests in the North American Debtors will be canceled, annulled, and extinguished. Class 7 Equity Interests in ITI will be reinstated and the legal, equitable, and contractual rights to which holders of Equity Interests in ITI are entitled shall remain unaltered to the extent necessary to implement the Plan. All Cash consideration necessary for payments or distributions on account of the North American Debtor Claims shall be obtained from (i) the Cash on hand of the North American Debtors on the Effective Date, including Cash derived from business operations and (ii) the Imerys Cash Contribution. Imerys S.A. has agreed to make, or cause the Imerys Contribution to be made in exchange for the releases and channeling injunction benefiting the Imerys Protected Parties as contemplated pursuant to the Plan. The Imerys Contribution includes (i) the Imerys Settlement Funds, (ii) the Imerys Cash Contribution, (iii) the Talc Trust Contribution, and (iv) the Additional Contribution. A full-text copy of the disclosure statement dated May 15, 2020, is available at https://tinyurl.com/y83ndv8a from PacerMonitor at no charge. Counsel for Debtors: RICHARDS, LAYTON & FINGER, P.A. Mark D. Collins, Esq. Michael J. Merchant, Esq. Amanda R. Steele, Esq. Brett M. Haywood, Esq. One Rodney Square 920 North King Street Wilmington, DE 19801 Telephone: (302) 651-7700 Facsimile: (302) 651-7701 - and - LATHAM & WATKINS LLP Jeffrey E. Bjork, Esq. Kimberly A. Posin, Esq. Helena G. Tseregounis, Esq. Shawn P. Hansen, Esq. 355 South Grand Avenue, Suite 100 Los Angeles, California 90071-1560 Telephone: (213) 485-1234 Facsimile: (213) 891-8763 - and - Richard A. Levy, Esq. 330 North Wabash Avenue, Suite 2800 Chicago, Illinois 60611 Telephone: (312) 876-7700 Facsimile: (312) 993-9767 About Imerys Talc America Imerys Talc and its subsidiaries --https://www.imerys-performance-additives.com/ -- are in the business of mining, processing, selling, and distributing talc. Talc is a hydrated magnesium silicate that is used in the manufacturing of dozens of products in a variety of sectors, including coatings, rubber, paper, polymers, cosmetics, food, and pharmaceuticals. Its talc operations include talc mines, plants, and distribution facilities located in: Montana (Yellowstone, Sappington, and Three Forks); Vermont (Argonaut and Ludlow); Texas (Houston); and Ontario, Canada (Timmins, Penhorwood, and Foleyet). It also utilizes offices located in San Jose, California and Roswell, Georgia. Imerys Talc America, Inc., and two subsidiaries, namely Imerys Talc Vermont, Inc., and Imerys Talc Canada Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 19-10289) on Feb. 13, 2019. The Debtors estimated $100 million to $500 million in assets and $50 million to $100 million in liabilities as of the bankruptcy filing. The Hon. Laurie Selber Silverstein is the case judge. The Debtors tapped Richards, Layton & Finger, P.A., and Latham & Watkins LLP as counsel; Alvarez & Marsal North America, LLC as financial advisor; and Prime Clerk LLC as claims agent. INTERNATIONAL GAME: Moody's Rates New Secured Notes Due 2029 'Ba3' ------------------------------------------------------------------ Moody's Investors Service assigned a Ba3 rating to International Game Technology PLC's proposed benchmark senior secured notes offering due 2029. The company's existing ratings, including the senior secured notes rated Ba3, the Ba3 Corporate Family Rating, Ba3-PD Probability of Default Rating and SGL-3 Speculative Grade Liquidity rating are unchanged. The outlook is unchanged at negative. Proceeds from the proposed senior secured notes offering, which will be pari passu with the company's existing senior secured debt, are expected to be $500 million and will be used to tender for $300 million of the company's $1.5 billion 6.25% notes due 2022, put cash to the balance sheet, repay a portion of the outstanding amount on the company's revolving credit facility, as well as pay related fees, expenses, premiums and accrued interest. The transaction is credit positive because it extends IGT's maturity profile and modestly improves overall financial flexibility, providing funds to facilitate the partial refinancing of a significant 2022 maturity, while maintaining adequate liquidity as the company continues to face disruption in casino visitation, gaming machine use, and lottery operations resulting from efforts to contain the spread of the coronavirus both in the US and in Italy. The growing number of gaming facilities reopening will favorably increase revenue for the company, but Moody's anticipates activity levels will remain well below pre-pandemic levels until at least 2022. The following ratings/assessments are affected by its action: Assignments: Issuer: International Game Technology PLC Senior Secured Global Notes, Assigned Ba3 (LGD3) RATINGS RATIONALE International Game Technology PLC's Ba3 CFR reflects the meaningful revenue and earnings decline over the next few months expected from efforts to contain the coronavirus and the potential for a slow recovery once customer facilities reopen and gaming conditions improve. Revenues are largely tied to the volume of gaming machine play and lotteries. Gaming is cyclical and dependent on discretionary consumer spending. The company can reduce spending on game development and capital expenditures when revenue weakens, but the need to retain a skilled workforce to maintain competitive technology contributes to high operating leverage. The credit profile benefits from IGT's large and relatively stable revenue base during normal operating periods, with more than 80% achieved on a recurring basis, and high barriers to entry. Further support is provided by the company's vast gaming-related software library and multiple delivery platforms, as well as potential growth opportunities in IGT's digital, mobile gaming, sports betting, and lottery products. IGT, through its joint venture with minority partners, is concessionaire of the world's largest instant ticket lottery (Italy) and Italy's draw based lottery and holds facility management contracts with some of the largest lotteries in the US. IGT is constrained by its material exposure to soft slot replacement demand trends in the US as well as significant revenue concentration (about one-third) coming from its Italian operations, along with Italian gaming tax increases. The speculative-grade liquidity rating of SGL-3 considers the expected decline in earnings and cash flow. As of the year ended March 31, 2020, IGT had unrestricted cash of approximately $1.5 billion, with $743 million of undrawn capacity on its $1.75 billion revolving credit facility that expires in July 2024. Moody's estimates the company could maintain sufficient internal cash sources after maintenance capital expenditures to meet required annual amortization and interest requirements assuming a sizeable decline in annual EBITDA. The expected EBITDA decline will not be ratable over the next year and because EBITDA and free cash flow will be negative for an uncertain time period, liquidity and leverage could deteriorate quickly over the next few months. The company amended its financial covenants and is now subject to a minimum liquidity covenant of $500 million (cash and undrawn committed revolver) through June 2021. Beginning with the quarter ended September 2021, the company will be subject to a 6.25x net leverage covenant which Moody's expects the company to comply with. 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 gaming 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 IGT's credit profile, including its exposure to travel disruptions and discretionary consumer spending have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and IGT remains vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The ratings and outlook reflect the impact on IGT of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. The negative outlook considers that IGT remains vulnerable to travel disruptions and unfavorable sudden shifts in discretionary consumer spending and the uncertainty regarding the timing of its customers' facilities reopening and the pace at which consumer spending at those properties will recover. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING Ratings could be downgraded if liquidity deteriorates or if Moody's anticipates IGT's earnings declines to be deeper or more prolonged because of actions to contain the spread of the virus or reductions in discretionary consumer spending. A ratings upgrade is unlikely given the weak operating environment. However, the ratings could be upgraded if customer facilities reopen and earnings recover such that positive free cash flow and reinvestment flexibility is restored and debt-to-EBITDA is sustained below 5.0x. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. International Game Technology PLC is a global leader in gaming, from Gaming Machines and Lotteries to Interactive Gaming and Sports Betting. The publicly-traded company operates under four business segments: North America Gaming & Interactive, North America Lottery; International, and Italy. The company's consolidated revenue for the last twelve-month period ended March 31, 2020 was approximately $4.6 billion. International Game Technology has corporate headquarters in London, and operating headquarters in Rome, Italy; Providence, Rhode Island; and Las Vegas, Nevada. JAMES WINDELL ETHRIDGE: Herpin Buying Land for $41.6K ----------------------------------------------------- James W. Ethridge and Janet D. Ethridge ask the U.S. Bankruptcy Court for the Western District of Louisiana to authorize the sale of a 3.96-acre parcel, Tract 3-L (2.166 acres) and Tract 3-M (1.125 acres) to Shawn Herpin for $41,619. The Debtors own several pieces of property located on or near Lake Arthur, Cameron Parish, Louisiana. A portion of the property consists of the Land. Herpin, an adjacent property owner, has offered to purchase the Land for $41,619. The Debtors believe that the Land is free and clear of all liens and encumbrances. They intend to use the proceeds from the sale of the Land to complete the bulkhead repairs for Lake Arthur South, that will allow the lots from that subdivision to be sold and plan payments to be made. The Chapter 11 case in In re James W. Ethridge and Janet D. Ethridge (Banks. W.D. La. Case No. 19-50878). JOHN DAUGHERTY: Committee Hires HooverSlovacek as Counsel --------------------------------------------------------- The official committee of unsecured creditors of John Daugherty Real Estate, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ HooverSlovacek LLP as its counsel. The Committee requires HooverSlovacek to: a. attend the meetings of the Committee; b. assist the Committee in negotiations with the Debtor and other parties in interest on the Debtor's proposed Chapter 11 plan; c. review financial and operational information furnished by the Debtor to the Committee; d. analyze and negotiate the budget and the terms of the Debtor's use of cash collateral; e. assist in the Debtor's efforts to reorganize or sell assets in a manner that maximizes value for creditors; f. review and investigate prepetition transactions in which the Debtor and/or its insiders were involved; g. investigate and analyze certain of the Debtor's prepetition conduct, transactions, and transfers; h. review the Debtor's schedules, statements of financial affairs, and other pleadings in the case; i. confer with the Debtor's counsel and any other retained professional; j. provide the Committee with legal advice in relation to the chapter 11 case; k. advise the Committee as to the ramifications regarding all the Debtor's activities and motions before this Court; l. prepare and file appropriate pleadings on behalf of the Committee; m. perform such other legal services for the Committee as may be necessary or proper in these proceedings. Current hourly billing rates for HooverSlovacek are: Deirdre Carey Brown $425 Melissa Haselden $400 Angeline V. Kell $310 Vianey Garza $290 Paraprofessionals $115-$160 Melissa Haselden, Esq., a partner at HooverSlovacek, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. HooverSlovacek can be reached at: Melissa A. Haselden, Esq. HooverSlovacek LLP 5051 Westheimer, Suite 1200 Houston, TX 77056 Tel: (713) 977-8686 Fax: (713) 977-5395 Email: haselden@hooverslovacek.com About John Daugherty Real Estate, Inc. John Daugherty Real Estate, Inc. -- https://www.johndaugherty.com -- is a licensed real estate broker in Houston, Texas, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-31293) on February 27, 2020. The petition was signed by John A. Daugherty, Jr., its chief executive officer. 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. Hon. Christopher M. Lopez oversees the case. The Debtor hired Nathan Sommers Jacobs, a professional corporation, as its counsel. KENNETH A. BERDICK: Selling Fort Myers Beach Property for $230K --------------------------------------------------------------- Kenneth Allen Berdick asks the U.S. Bankruptcy Court for the Middle District of Florida to authorize the sale of his interest in 7148 Estero Boulevard, Unit 122, Fort Myers Beach, Florida to Joseph Allen and Victoria Allen for $230,000, subject to overbid. Objections, if any, must be filed within 21 days from the date the Motion was served. The Debtor has determined that the sale of the Asset to the Purchaser will enable the Debtor to obtain the highest and best offer for the Asset and is in the best interests of the Debtor, its estate and creditors. He has proposed the sale of the Asset after thorough consideration of all viable alternatives and has concluded that such sale is supported by a number of sound business reasons, including that a sale of his assets will maximize value. The Debtor does not live in the Asset, and the proceeds will be used to satisfy creditors. The current offer for $230,000 is the highest offer for the Asset after months of marketing. The Debtor asks authority to sell the Asset to the Purchaser free and clear of liens, claims, encumbrances and other interests with liens to attach to proceeds. The Debtor further asks that the Court waives the 14-day automatic stay of the sale, imposed under Bankruptcy Rule 6004(g). A copy of the Agreement is available at https://tinyurl.com/yb4vd6dz from PacerMonitor.com free of charge. Kenneth Allen Berdick sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 20-01107) on Feb. 10, 2020. The Debtor tapped Charles Phoenix, Esq., as counsel. KENNETH A. BERDICK: Selling Interest in Fort Myers Beach Property ----------------------------------------------------------------- Kenneth Allen Berdick asks the U.S. Bankruptcy Court for the Middle District of Florida to authorize the sale of his interest in 7148 Estero Boulevard, Unit 122, Fort Myers Beach, Florida, to Joseph Allen and Victoria Allen for $230,000, subject to overbid. Objections, if any, must be filed within 21 days from the date the Motion was served. The Debtor has determined that the sale of the Asset to the Purchaser will enable the Debtor to obtain the highest and best offer for the Asset and is in the best interests of the Debtor, its estate and creditors. He has proposed the sale of the Asset after thorough consideration of all viable alternatives and has concluded that such sale is supported by a number of sound business reasons, including that a sale of his assets will maximize value. The Debtor does not live in the Asset, and the proceeds will be used to satisfy creditors. The current offer for $230,000 is the highest offer for the Asset after months of marketing. The Debtor asks authority to sell the Asset to the Purchaser free and clear of liens, claims, encumbrances and other interests with liens to attach to proceeds. The Purchaser wishes to close as soon as possible. The Debtor asks that the Court waives the 14-day automatic stay of the sale, imposed under Bankruptcy Rule 6004(g). A copy of the Agreement is available at https://tinyurl.com/y7mb8lcf from PacerMonitor.com free of charge. Kenneth Allen Berdick sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 20-01107) on Feb. 10, 2020. The Debtor tapped Charles Phoenix, Esq., as counsel. KLAUSNER LUMBER: Sets Bidding Procedures for All Assets ------------------------------------------------------- Klausner Lumber One, LLC, asks the U.S. Bankruptcy Court for the District of Delaware to authorize the bidding procedures in connection with the auction sale of substantially all assets. The Debtor was formed several years ago, along with a sister entity Klausner Lumber Two LLC, to build two state-of-the-art sawmills: Debtor KL1 in the aptly-named town of Live Oak, in north-central Florida, an area known for its abundant timber and agricultural resources, and KL2 in eastern North Carolina, which had similar natural advantages for a large, modern timber mill. Over $147 million was invested in the Debtor in order to construct a large state-of-the art sawmill from the ground up and render it operational. Such funds were raised through shareholder and related-party loans and capital, including an indirect investment by "EB-5" investors in Florida Sawmills L.P., an affiliate of the Debtor. After construction was complete, KL1 began production in March 2015, and built up to annual production of over 240 million board feet of lumber. However, construction and production were delayed, resulting in cost overruns and a drain on liquidity. Production, sales, and distribution thereafter were not as successful as hoped, resulting in KL1 needing additional funds, and accruing trade debt. By early 2020, KL1 found itself on very unsound financial footing, such that remedial steps (if any) would have to be taken quickly. In March 2020, Asgaard Capital, LLC was put in contact with KL1's senior managers in Europe. Throughout April, Asgaard (and the other proposed KL1 professionals) invested significant time and resources learning about the Debtor's assets and operations. As part of the Debtor’s efforts to find a value-maximizing transaction for its assets, the Debtor retained Cypress Associates, an experienced investment banker, to canvass the market for interested buyers. The Chapter 11 Case was then initiated to effectuate the Sale Process described. Since being retained in mid-April, 2020, Cypress has contacted and received interest from more than 15 prospective strategic and financial buyers. In addition, Asgaard negotiated aggressively with the two potential new post-petition lenders, resulting in Big Shoulders Capital VI, LLC and CRG Acquisition, LLC agreeing to provide post-petition financing subject to the Court's approval. That said, the Debtor has no ability to fully resume production. The Debtor and its professionals have determined, and it is doubtful that any creditor would contest, that a sale is the best way to monetize the Debtor's assets. In furtherance of this, the Debtor has filed the Motion asking authority to proceed with a bidding and auction process to consummate a sale or series of sales that the Debtor expects will generate maximum value for its assets. Although the Debtor has not obtained any stalking horse bids for its assets as of the filing of the Motion, as set forth throughout this Motion, the Bid Procedures allow the Debtor to enter into a stalking horse asset purchase agreement. The Debtor is asking approval to enter into an APA with any Stalking Horse Purchaser not later than June 29, 2020. It asks authorization, but not direction, to accept an offer from any Stalking Horse Purchaser to purchase the Assets and execute any Stalking Horse APA, subject to the Bidding Procedures. The salient terms of the Bidding Procedures are: a. Bid Deadline: July 13, 2020 at 5:00 p.m. (ET) b. Initial Bid: In the event that there is a Stalking Horse Purchaser, the aggregate consideration proposed by the Qualifying Bidder must equal or exceed the sum of the amount of (A) any Stalking Horse Purchase Price, (B) any Break-Up Fee, (C) any Expense Reimbursement, and (D) $100,000. c. Deposit: 10% of the purchase price d. Auction: The Auction will be held on July 17, 2020 at 10:00 a.m. (ET) at the offices of Morris, Nichols, Arsht & Tunnell LLP, 1201 North Market Street, Wilmington, DE 19899-1347. e. Bid Increments: $100,000 f. Sale Hearing: July 23, 2020 g. Sale Objection Deadline: July 16, 2020 at 4:00 p.m. (ET) h. Closing: No later than July 31, 2020 i. The Debtor proposes that the DIP Lender, in its capacity as such under the DIP Order, which holds claims that are secured by valid, binding, enforceable, non-avoidable and perfected liens on and security interests in substantially all of the Assets as provided for in the DIP Order, be entitled to credit bid all or a portion of the amounts then outstanding under the DIP Credit Facility plus the minimum cash component of such credit bid required under the DIP Order, or any part thereof, under section 363(k) of the Bankruptcy Code and as provided for in the DIP Order and the Bidding Procedures. j. Break-Up Fee will not exceed 2% of the Stalking Horse Purchase Price, and the aggregate amount of any Expense Reimbursement will not exceed 1% of any Stalking Horse Purchase Price. The Debtor also asks approval of the Sale Notice. Upon entry of the Bidding Procedures Order, the Debtor will serve the Sale Notice upon all the Sale Notice Parties. It will also cause the Sale Notice to be published once in the national edition of USA Today, the Suwannee (Florida) Democrat, and the Gainesville (Florida) Sun, and post the Sale Notice and the Bidding Procedures Order on the website of the Debtor's claims and noticing agent. To facilitate the Sale, the Debtor asks authority to assume and assign to any Stalking Purchaser or, absent any Stalking Horse Purchaser or in the event the Stalking Horse Purchaser is not the Successful Bidder, then to the Successful Bidder, the Assumed Contracts in accordance with the Assumption and Assignment Procedures. The Assumption Notice Deadline is July 1, 2020. The Contract Objection Deadline at 4:00 p.m. (ET) on July 16, 2020. In the event any Stalking Horse Purchaser is not the Successful Bidder, the Counterparties will file any Contract Objections solely on the basis of adequate assurance of future performance not later than July 21, 2020 at 4:00 p.m. (ET). The Debtor submits that, in the interest of attracting the best offers, it is appropriate to sell the Assets on a final "as is" basis, free and clear of any and all Encumbrances. It proposes that any Encumbrances asserted against the Assets be transferred to and attach to the proceeds of the Sale, and application of the proceeds generated by the Sale will be subject to any applicable provisions of the DIP Order. Finally, as set forth throughout the Motion, any delay in the Debtor's ability to consummate the Sale on the timeline contemplated by the Bidding Procedures would be detrimental to the Debtor, its creditors and estate. For this reason, the Debtor submits that ample cause exists to justify a waiver of the 14-day stay imposed by Bankruptcy Rule 6004(h) and 6006(d), to the extent applicable. A copy of the Bidding Procedures is available at https://tinyurl.com/yd3jv44m from PacerMonitor.com free of charge. About Klausner Lumber One Klausner Lumber One, LLC is a privately held company in the lumber and plywood products manufacturing industry. It is 100% owned by non-debtor Klausner Holding USA, Inc. Klausner Lumber One sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 20-11033) on April 30, 2020. At the time of the filing, Debtor disclosed assets of between $100 million and $500 million and liabilities of the same range. The Debtor tapped Westerman Ball Ederer Miller Zucker & Sharfstein, LLP as bankruptcy counsel; Morris, Nichols, Arsht & Tunnell, LLP as local counsel; Asgaard Capital, LLC as restructuring advisor; and Cypress Holdings, LLC as investment banker. KP ENGINEERING: Reaches Agreement to Resolve Committee Issues ------------------------------------------------------------- Debtors KP Engineering, LP (KPE LP) and KP Engineering, LLC (KPE LLC) filed the Third Amended Disclosure Statement in support of Joint Chapter 11 Plan of Reorganization dated May 15, 2020. On April 27, 2020, the Bankruptcy Court entered an order authorizing the Debtors, the Committee, TCB and Brandon Steele to mediate their unresolved issues regarding the Committee Litigation and the terms of the Plan. The Bankruptcy Court appointed the Honorable Marvin Isgur, United States Bankruptcy Judge, as the Mediator. The parties began the mediation on May 1, 2020. After several sessions, an agreement was reached to resolve the primary outstanding issues which resulted in the Committee supporting the Third Amended Plan. The primary terms of the Mediated Settlement are contained in the Mediated Settlement Term Sheet. Notably, with the Mediated Settlement in place, the Committee supports the compromise and settlement with TCB described in the Plan, including, but not limited to, TCB receiving a full and complete release and dismissal from the Committee Litigation. In light of the foregoing, and considering the additional consideration provided by TCB pursuant to the Mediated Settlement, the Debtors submit that this compromise with TCB and Class 2 treatment should be approved by the Bankruptcy Court in all respects pursuant to Bankruptcy Rule 9019 and applicable Fifth Circuit law. A full-text copy of the Third Amended Disclosure Statement dated May 15, 2020, is available at https://tinyurl.com/y75qf2ct from PacerMonitor at no charge. The Debtors are represented by: OKIN ADAMS LLP Christopher Adams James W. Bartlett, Jr. Ryan A. O'Connor 1113 Vine St., Suite 240 Houston, Texas 77002 Tel: 713.228.4100 Fax: 888.865.2118 E-mail: cadams@okinadams.com jbartlett@okinadams.com roconnor@okinadams.com About KP Engineering KP Engineering, LP and KP Engineering, LLC -- https://www.kpe.com/ -- are primarily engaged in the business of designing and executing customized engineering, procurement, and construction projects for the refining, midstream, and chemical industries. As an EPC contractor, the companies generally enter into agreements with owners pursuant to which they will design a facility, procure the needed equipment and materials, and supervise construction of the facility. KP Engineering, LP and KP Engineering, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Case No.19-34698) on Aug. 22, 2019. At the time of the filing, KP Engineering had estimated assets of between $10 million and $50 million and liabilities of between $50 million and $100 million. Judge David R. Jones oversees the cases. KP Engineering tapped Hunton Andrews Kurth LLP and Okin Adams LLC as legal counsel; Claro Group LLC as restructuring advisor; and Omni Management Group, Inc. as claims and noticing agent. The Office of the U.S. Trustee appointed a committee of unsecured creditors on Sept. 6, 2019. The committee retained Foley Gardere, Foley & Lardner LLP as its legal counsel, and Alvarez & Marsal North America, LLC as its financial advisor. L BRANDS: S&P Rates New $750MM Senior Secured Notes 'BB' --------------------------------------------------------- S&P Global Ratings assigned its 'BB' issue-level and '1' recovery ratings to Columbus, Ohio-based retailer of apparel and personal care products L Brands Inc.'s proposed $750 million senior secured notes. The '1' recovery rating indicates its expectation for very high (90%-100%; rounded estimate: 95%) recovery in the event of a payment default. S&P also assigned its 'B+' issue-level and '4' recovery ratings to the company's proposed $500 million guaranteed senior unsecured notes. The '4' recovery rating indicates S&P's expectation for average (30%-50%; rounded estimate: 30%) recovery. The rating agency revised its recovery rating on the company's existing guaranteed senior unsecured debt to '4' from '3'. The '4' recovery rating indicates S&P's expectation for average (30%-50%; rounded estimate: 30%) recovery. The 'B+' issue-level rating is unchanged. The revised recovery rating reflects the addition of senior secured debt that reduces recovery prospects for unsecured claims, as well as S&P's updated assumptions for the enterprise value (EV) of L Brands in a hypothetical bankruptcy scenario. The 'B-' ratings on the unsecured notes without subsidiary guarantees are unchanged. The recovery ratings remain '6', indicating S&P's expectation for (0%-10%%; rounded estimate: 0%) recovery. The 'B+' issuer credit rating is unchanged, and it reflects S&P's expectation for L Brands to reduce leverage to below 5x by fiscal 2021, despite the proposed debt issuances and termination of the agreement with private equity firm Sycamore Partners to purchase a 55% controlling interest in Victoria's Secret. The termination will result in lower S&P Global Ratings-adjusted EBITDA and higher leverage in fiscal 2020, because the rating agency were previously assuming the transaction would close in fiscal 2020 and it anticipates substantial pressure at Victoria's Secret from the COVID-19 pandemic. However, S&P expects company actions to reduce the store base of Victoria's Secret and cut costs will contribute to a sizable rebound in EBITDA in fiscal 2021. "The negative outlook on L Brands reflects our view that we could lower the rating if profit declines and cash flow shortfalls are greater than we anticipate, leading to leverage sustained around 5x; or if we view the competitive position of L Brands as materially weakened, leading us to view its competitive standing less favorably," S&P said. Issue Ratings--Recovery Analysis Key analytical factors -- S&P's simulated default scenario contemplates a default resulting from a steep decline in EBITDA. This decline would be due to several factors, including deterioration of the company's competitive standing as a result of ineffective merchandising and marketing strategies, as well as intensified competition. S&P believes this could occur amid a protracted decline in the economy and a weak consumer spending environment. -- S&P's recovery analysis assumes that in a hypothetical bankruptcy scenario, the unsecured notes with subsidiary guarantees would benefit from the residual emergence value after the secured claims are satisfied. -- As for the unsecured notes without subsidiary guarantees, which S&P views as structurally subordinated, it sees negligible value available to the noteholders after the secured and unsecured claims with guarantees are satisfied. -- S&P has valued L Brands on a going-concern basis using a 5.5x multiple applied to its projected emergence-level EBITDA to arrive at its estimated gross emergence value of $3.5 billion. -- The revision in S&P's EV from its last recovery analysis of about $3.3 billion reflects the inclusion of Victoria's Secret in its analysis (previously, it had only considered Bath and Body Works). Simulated default assumptions -- Simulated year of default: 2024 -- EBITDA at emergence: $645 million -- Implied EV multiple: 5.5x -- Estimated gross EV at emergence of $3.5 billion Simplified waterfall -- Net EV after 5% administrative costs: $3.36 billion -- Revolver-related claims*: $594 million (not rated) -- Secured note claims*: $784 million -- Recovery expectations: 90%-100% (rounded estimate: 95%) -- Unsecured notes with subsidiary guarantees and other unsecured claims: $5.75 billion -- Recovery expectations: 30%-50% (rounded estimate: 30%) -- Unsecured notes without subsidiary guarantees-related claims: $674 million -- Recovery expectations: 0%-10% (rounded estimate: 0%) All debts amounts include six months of prepetition interest. LA MERCED: OSP to Reply to Mortgage Property Sale Opposition ------------------------------------------------------------ Judge Enrique S. Lamoutte of the U.S. Bankruptcy Court for the District of Puerto Rico ordered OSP Consortium, LLC, the assignee of Condado 5, LLC, a secured creditor of La Merced Limited Partnership SE, to state its position within 14 days as to the Debtor's opposition for the sale of the Mortgage Property for $4,059,354, cash, subject to overbid, filed on June 4, 2020. The Mortgaged Property is described in the Registry of Property in the Spanish language as follows: --- URBANA: Predio de terreno radicado en la URBANIZACION ELEONOR ROOSEVELT, radicada en el Barrio Hato Rey del término municipal de Rio Piedras, hoy San Juan, Puerto Rico, con una cabida de TRES MIL TRESCIENTOS CATORCE PUNTO VEINTICINCO (3,314.25) metros cuadrados. En lindes por el NORTE, en ciento veintinueve (129) pies nueve (9) pulgadas con la Avenida A; por el SUR, en igual medida con terrenos de la Asociación de Miembros de la Policía Insular; por el ESTE, en doscientos setenta y cinco (275) pies ocho y tres cuartos (8 ¾) pulgadas, con la Calle "T"; y por el OESTE, en igual medida con la Calle "H". --- Enclava en dicho terreno un edificio todo de concreto, de dos (2) plantas, dedicado a una escuela privada. --- Finca número trece mil cuatrocientos cincuenta y tres (13,453), inscrita alfolio cuatro (4) del tomo mil cuatrocientos sesenta y seis (1466) de Rio Piedras Norte, en el Registro de la Propiedad de Puerto Rico, Segunda Sección de San Juan. About La Merced LP La Merced Limited Partnership, S.E., is a single asset real estate, as defined in 11 U.S.C. Section 101(51B)). Based in San Juan, Puerto Rico, La Merced LP filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. D.P.R. Case No. 18-06858) on Nov. 27, 2018. In the petition signed by Luz Celenia Castellano, administrator, the Debtor disclosed $6,088,228 in liabilities. Judge Enrique S. Lamoutte Inclan is the case judge. Nelson Robles Diaz Law Offices, PSC, led by founding partner Nelson Robles Diaz, is the Debtor's counsel. LSC COMMUNICATIONS: Sets Bidding Procedures for All Assets ---------------------------------------------------------- LSC Communications, Inc., and affiliates ask the U.S. Bankruptcy Court for the Southern District of New York to authorize the bidding procedures in connection with the auction sale of substantially all assets. The Debtors commenced these chapter 11 cases on April 13, 2020 to explore strategic alternatives to maximize the value of their estates and the recoveries of their stakeholders, including a sale of all or substantially all of their assets in a section 363 sale process. On Oct. 30, 2018, LSC Communications entered into an agreement and plan of merger with Quad/Graphics, Inc., pursuant to which, subject to certain conditions, LSC Communications would be merged with a wholly owned subsidiary of Quad. On July 22, 2019, Quad and LSC Communications agreed to terminate the Merger Agreement, following failed settlement negotiations with the U.S. Department of Justice, and the DOJ civil antitrust lawsuit to block the proposed merger that ensued. Upon such termination, Quad paid LSC Communications the reverse termination fee provided for in the Merger Agreement of $45 million in cash. Following the termination of the Merger Agreement, LSC Communications took steps to consolidate plants and optimize its footprint, including the strategic closure of nine manufacturing facilities, activities that were not permitted under the Merger Agreement during the pendency of the merger. Based on final results of operations for the year ended Dec. 31, 2019, the Debtors concluded they were not in compliance with the consolidated leverage ratio and minimum interest ratio covenants contained in the credit agreement that governs their first lien revolving credit and term loan facilities. In connection therewith, the Debtors entered into a short-term waiver and forbearance agreement with a majority of their lenders through the period ending on May 14, 2020. Facing steadily declining liquidity ratios, the Debtors engaged in discussions with their prepetition lenders and the lenders under their DIP Facility to consider and explore various strategic alternatives. They, in consultation with their advisors and key stakeholders, ultimately decided to pursue a dual-track balance sheet restructuring and a marketing process for all or substantially all of their Assets in order to maximize the value of their estates. The Debtors believe that the Assets may prove attractive to potential strategic buyers in the printing and related services industry, including printing logistics, and in the office products business, and to potential financial buyers. Prior to the Petition Date, the Debtors, with the assistance of their financial advisor, Evercore Group L.L.C., considered and explored various strategic alternatives, and the Debtors ultimately decided that marketing all or substantially all of their Assets was in the best interests of their stakeholders. The Debtors, with the assistance of Evercore, will continue to progress the marketing process for the Assets after the filing of these chapter 11 cases. They believe that the conduct of a marketing process that contemplates a sale in the time and manner set forth herein will maximize their strategic alternatives and the value of their estates. To ensure that the Assets are sold for the highest or otherwise best offer, the Debtors have developed bid and auction procedures to govern the sale of the Assets at the Auction(s). The Bid Procedures are designed to provide the Debtors necessary flexibility to meet their milestones under the DIP Facility with respect to a timely marketing process and solicitations of indications of interest. The salient terms of the Bidding Procedures are: a. Bid Deadline: Not later than 5:00 p.m. (ET) on July 30, 2020 b. Initial Bid: TBD c. Deposit: 10% of the aggregate value of the cash and non-cash consideration of the bid d. Auction: The Auction(s) will be in accordance with the Bid Procedures and upon notice to all Qualified Bidders who have submitted Qualified Bids. The Auction(s), if held, will be conducted at the offices of Sullivan & Cromwell LLP located at 125 Broad Street, New York, New York (or, if the Debtors so determine, virtually), at a time no later than Aug. 4, 2020, which dates and times will be timely communicated to all Qualified Bidders entitled to attend the applicable Auction. e. Bid Increments: TBD f. Sale Hearing: Date(s) to be determined g. Sale Objection Deadline: Seven days prior to the Sale Hearing h. Bid Protections: Up to $750,000 After consultation with the Consulting Professionals, the Debtors may at any time after the IOI Deadline and prior to the Auction(s) designate one or more Qualified Bids as a stalking horse bid, and execute a purchase agreement with the applicable stalking horse bidder. Within five business days after entry of the Bid Procedures Order, or as soon as reasonably practicable thereafter, the Debtors will serve the Sale Notice upon the Sale Notice Parties. In connection with the sale contemplated by this Motion, the Debtors anticipate that they will assume and assign to the Successful Bidder (or its designated assignee(s)) all or certain executory contracts and unexpired leases pursuant to section 365(b) of the Bankruptcy Code. Accordingly, the Debtors propose that the assumption and assignment of executory contracts and unexpired leases in connection with the sale of any or all of the Assets be subject to the Assumption and Assignment Procedures and ask that the Assumption and Assignment Procedures be approved by the Court pursuant to the Bid Procedures Order. Following the Bid Deadline, the Debtors may file with the Court and serve the Initial Assignment Notice on each Counterparty. In the interest of attracting the best offers, the Debtors ask authorization to sell the Assets free and clear of any and all liens, claims, encumbrances and other interests, with any such liens, claims, encumbrances and other interests attaching to the proceeds of the sale of the Assets and distributed as provided for in a further order of the Court. Finally, the Debtors ask that the Bid Procedures Order, the Sale Order(s) and any order authorizing the assumption and assignment of an Assumed Debtor Contract in connection with a sale be effective immediately upon entry and that the 14-day stay imposed by Bankruptcy Rules 6004(h) and 6006(d) be waived. A copy of the Bidding Procedures is available at https://tinyurl.com/yadnsred from PacerMonitor.com free of charge. 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 certain of its affiliates sought Chapter 11 protection (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 hired 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. MADAME PAULETTE: Seeks to Hire Morrison Tenenbaum as Counsel ------------------------------------------------------------ Madame Paulette LIC, LLC, and its debtor-affiliates filed an amended application, seeking authority from the US Bankruptcy Court for the Eastern District of New York to hire Morrison Tenenbaum PLLC, as their counsel. Madame Paulette requires Morrison Tenenbaum to: a. advise the Debtor with respect to its powers and duties as debtor-in-possession in the management of its estate; b. assist in any amendments of Schedules and other financial disclosures and in the reparation/review/amendment of a disclosure statement and plan of reorganization; c. negotiate with the Debtor's creditors and taking the necessary legal steps to confirm and consummate a plan of reorganization; d. prepare on behalf of the Debtor all necessary motions, applications, answers, proposed orders, reports and other papers to be filed by the Debtor in this case; e. appear before the Bankruptcy Court to represent and protect the interests of the Debtor and its estate; and f. perform all other legal services for the Debtor that may be necessary and proper for an effective reorganization. Morrison Tenenbaum will be paid at these hourly rates: Lawrence F. Morrison $525 Brian J. Hufnagel $425 Associates $380 Paraprofessionals $200 On or about Feb. 3, 2020, MT Law received a retainer fee in the amount of $20,000. Morrison Tenenbaum will also be reimbursed for reasonable out-of-pocket expenses incurred. Lawrence F. Morrison, a partner at Morrison Tenenbaum, PLLC, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Morrison Tenenbaum can be reached at: Lawrence F. Morrison, Esq. Brian J. Hufnagel, Esq. MORRISON TENENBAUM PLLC 87 Walker Street, Floor 2 New York, NY 10013 Tel: (212) 620-0938 E-mail: lmorrison@m-t-law.com bjhufnagel@m-t-law.com About Madame Paulette LIC, LLC Madame Paulette LIC, LLC, operates dry cleaning and general cleaning service at 42-20 12th Street, Long Island City, New York 11101. Madame Paulette LIC, LLC, filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 20-40714) on Feb. 4, 2020, listing under $1 million in both assets and liabilities. The Debtor is represented by Lawrence F. Morrison, Esq., at Morrison Tenenbaum, PLLC. MARIA O. MARIA: Hires Cushman & Wakefield Realty as Broker ---------------------------------------------------------- Maria O Maria, LLC, seeks authority from the US Bankruptcy Code for the Southern District of New York to employ Cushman & Wakefield Realty of Manhattan, LLC as its real estate broker. The Debtor owns a commercial condominium located at 106 Duane Street, New York, New York. The property will be offered for sale at a list price of $4,500,000. The broker will receive a commission in the amount of 4 percent to 5 percent pf the gross sale proceeds. The broker neither hold nor represents any interests adverse to the Debtor's estate 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: Joseph Swingle 275 Madison Avenue 3rd Floor New York, NY 10016 Phone: 1-212-696-2500 About Maria O Maria, LLC Based in New York, New York, Maria O Maria, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y.) on Nov. 20, 2019. In the petition signed by Maria Pardo, sole member, the Debtor estimated $1,000,001 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 ------------------------------------------------- On May 12, 2020, MCL Nursing, LLC, filed with the U.S. Bankruptcy Court for the Northern District of Georgia, Atlanta Division, an Amended Disclosure Statement referring to the Chapter 11 Plan. On May 15, 2020, Judge Barbara Ellis-Monro ordered that: * The Amended Disclosure Statement is approved and the Debtor is directed to remove the bank statements and insurance statements attached to the Debtor's March 2020 Operating Report, and substitute it as Exhibit "B" to the Disclosure Statement, before distribution with the Plan. * June 29, 2020 is fixed as the last day for filing ballots indicating written acceptances or rejections of the Plan. * July 7, 2020 at 11:00 a.m. in Courtroom 1402, United States Courthouse, 75 Ted Turner Drive, S.W., Atlanta, Georgia 30303 is fixed as the time for the hearing on confirmation of the Plan. * June 29, 2020 is fixed as the last day for filing and serving written objections to confirmation of the Plan. A copy of the order dated May 15, 2020, is available at https://tinyurl.com/ybe8ceod from PacerMonitor at no charge. The Debtor is represented by: THEODORE N. STAPLETON, PC Theodore N. Stapleton 2802 Paces Ferry Road, Suite 100-B Atlanta, Georgia 30339 Tel: (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. MICROCHIP TECHNOLOGY: S&P Rates $1BB 2.67% Sr. Secured Notes 'BB+' ------------------------------------------------------------------ S&P Global Ratings assigned its unsolicited 'BB+' issue-level rating and '2' recovery rating to Arizona-based Microchip Technology Inc.'s $1 billion 2.67% senior secured notes due 2023. The '2' recovery rating indicates S&P's expectation for substantial (70%-90%; rounded estimate: 70%) recovery. At the same time, S&P assigned its unsolicited 'BB-' issue-level rating and '5' recovery rating to its $1.2 billion 4.25% senior unsecured notes due 2025. The '5' recovery rating indicates S&P's expectation for modest (10%-30%; rounded estimate: 15%) recovery. The company expects to use the net proceeds from both issuances to repay existing debt. All of S&P's existing ratings on Microchip remain unchanged, including the unsolicited 'BB' issuer credit rating. S&P believes this is a leverage-neutral transaction and does not affect its view of the company's credit profile. It estimates adjusted leverage at low-to-mid 5x area as of March 31, 2020. S&P expects Microchip to face near-term revenue pressure, including about a low- to mid-single-digit percent decline in fiscal 2021 (ending March 31, 2021) because of the uncertainty around its end-market demand due to COVID-19. However, S&P expects the company's EBITDA margins to improve modestly to the low-40% area on cost savings from the Microsemi Corp. acquisition. The stable outlook on Microchip reflects its good market positions, enhanced scale following the acquisition of Microsemi, diverse end markets, and long product cycles, which will support good cash flow generation over the coming year. S&P could lower its rating on the company if its leverage remains above 5x due to a prolonged weak operating performance and weak end-market demand. The rating agency could also lower its rating if the company shifts to an aggressive financial policy, including increased shareholder returns, debt-financed acquisitions, or business divestitures leading to sustained leverage of more than 5x. ISSUE RATINGS--RECOVERY ANALYSIS Key analytical factors -- S&P's simulated default scenario assumes a default occurring in 2024 because of an economic downturn and weak end-market conditions. High research and development requirements and fixed costs could lead to severe EBITDA deterioration and negative cash flows. -- S&P has valued the company as a going concern by applying a 6.5x EBITDA multiple to the rating agency's emergence EBITDA proxy of about $942 million to arrive at a gross enterprise value of about $6.1 billion. -- Based on the allocation of the company's assets, S&P has ascribed 60% and 40% of its total enterprise value to its domestic and foreign operations, respectively. Simulated default assumptions -- Simulated year of default: 2024 -- EBITDA at emergence: Approximately $942 million -- EBITDA multiple: 6.5x -- Revolver is 85% drawn at the time of default Simplified waterfall -- Collateral value available for first-lien claims: Approximately $5.0 billion -- Secured first-lien debt claim: Approximately $7.9 billion -- Recovery expectations: 70%-90% (rounded estimate: 70%) -- Residual value available for unsecured claims: $814.8 million -- Senior unsecured debt claims: $1.2 billion -- Residual pari passu secured claims: $2.9 billion -- Recovery expectations: 10%-30% (rounded estimate: 15%) -- Senior subordinated debt claims: $2.2 billion -- Recovery expectations: 0%-10% (rounded estimate: 0%) -- Structurally subordinated debt claims: $693.7 million -- Recovery expectations: 0%-10% (rounded estimate: 0%) Note: All debt amounts include six months of prepetition interest. MIDTOWN CAMPUS: Seeks to Hire Genovese Joblove as Counsel --------------------------------------------------------- Midtown Campus Properties, LLC, seeks authority from the United States Bankruptcy Court for the Southern District of Florida to employ Genovese Joblove & Battista, P.A., as its counsel. Midtown Campus requires Genovese Joblove to: (a) advise the Debtor with respect to its powers and duties as debtor and debtor-in-possession in the continued management and operation of its business and properties; (b) attend meetings and negotiate with representatives of creditors and other parties-in-interest and advise and consult on the conduct of the cases, including all of the legal and administrative requirements of operating in Chapter 11; (c) advise the Debtor in connection with any contemplated sales of assets or business combinations, including the negotiation of sales promotion, liquidation, stock purchase, merger or joint venture agreements, formulate and implement bidding procedures, evaluate competing offers, draft appropriate corporate documents with respect to the proposed sales, and counsel the Debtor in connection with the closing of such sales; (d) advise the Debtor in connection with post-petition financing and cash collateral arrangements, provide advice and counsel with respect to pre-petition financing arrangements, and provide advice to the Debtor in connection with the emergence financing and capital structure, and negotiate and draft documents relating thereto; (e) advise the Debtor on matters relating to the evaluation of the assumption, rejection or assignment of unexpired leases and executory contracts, including the obligations of the Debtor under Section 1110 of the Bankruptcy Code; (f) provide advice to the Debtor with respect to legal issues arising in or relating to the Debtor's ordinary course of business including attendance at senior management meetings, meetings with the Debtor's board of directors, and advice on employee, workers' compensation, employee benefits, labor, tax, insurance, securities, corporate, business operation, contracts, joint ventures, press/public affairs and regulatory matters; (g) take all necessary action to protect and preserve the Debtor's estate, including the prosecution of actions on its behalf, the defense of any actions commenced against the estates, negotiations concerning all litigation in which the Debtor may be involved and objections to claims filed against the estate; (h) prepare on behalf of the Debtor all motions, applications, answers, orders, reports and papers necessary to the administration of the estate; (i) negotiate and prepare on the Debtor's behalf a plan of reorganization, disclosure statement and all related agreements and/or documents, and take any necessary action on behalf of the Debtor to obtain confirmation of such plan; (j) attend meetings with third parties and participate in negotiations with respect to the above matters; (k) appear before this Court, any appellate courts, and the U.S. Trustee, and protect the interests of the Debtor's estate before such courts and the U.S. Trustee; and (l) perform all other necessary legal services and provide all other necessary legal advice to the Debtor in connection with this Chapter 11 case. Genovese Joblove will be paid at these hourly rates: Paul J. Battista $675 Mariaelena Gayo-Guitian $550 Heather Harmon $525 Genovese Joblove received a retainer from the Debtor in the amount of $50,000. Genovese Joblove will also be reimbursed for reasonable out-of-pocket expenses incurred. Paul J. Battista, partner of Genovese Joblove & Battista, P.A., assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Genovese Joblove can be reached at: Paul J. Battista, Esq. GENOVESE JOBLOVE & BATTISTA, P.A. 100 Southeast Second Street, 44th Floor Miami, FL 33131 Tel: (305) 349-2300 Fax: (305) 349-2310 E-mail: pbattista@gjb-law.com 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 N MIDTOWN CAMPUS: Seeks to Hire KapilaMukamal as Financial Advisor ---------------------------------------------------------------- Midtown Campus Properties, LLC, seeks authority from the United States Bankruptcy Court for the Southern District of Florida to employ KapilaMukamal LLC as its financial advisors. Midtown Campus requires KapilaMukamal to: (a) assist in the preparation of financial information for distribution to creditors and others, including, but not limited to, cash flow projections and budgets, cash receipts and disbursement analysis, analysis of various asset and liability accounts, and analysis of proposed transactions for which Court approval is sought; (b) assist the Debtor in the preparation of its Monthly Operating Reports; (c) prepare or review the financial budgets, projections, project cost, cash flow and profitability estimates in connection with the plan of reorganization. (d) assist in the development and/or review of the Debtor's plan of reorganization and disclosure statement; (e) render expert testimony and litigation support services, including ediscovery services, as requested from time to time by the Debtor and its counsel, regarding any of the matters to which KapilaMukamal is providing services; (f) attendance at meetings and court hearings as may be required in the role of financial advisors to the Debtor; and (g) assist and render such other general business consulting or such other assistance as Debtors' management or counsel may deem necessary related to the Midtown Project and that are consistent with the role of a financial advisor and not duplicative of services provided by other professionals in these proceedings. The current hourly rates for the KapilaMukamal's financial advisors and accountants who work on hourly rates in accordance with its normal and customary business practices range between $170 and $650. KapilaMukamal received a retainer from the Debtor in the amount of $20,000. KapilaMukamal will also be reimbursed for reasonable out-of-pocket expenses incurred. Soneet R. Kapila, partner at KapilaMukamal, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. KapilaMukamal may be reached at: Soneet R. Kapila KapilaMukamal 1000 South Federal Highway, Suite 200 Fort Lauderdale, FL 33316 Phone: 954-712-3201 E-mail: kapila@kapilamukamal.com 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. MOOG INC: S&P Alters Outlook to Negative, Affirms 'BB+' ICR ----------------------------------------------------------- S&P Global Ratings revised its outlook on Moog Inc. to negative from stable and affirmed all of its ratings on the company, including its 'BB+' issuer credit rating. Moog's credit metrics will likely be weaker over the next two fiscal years because of the coronavirus pandemic. S&P expects the revenue and earnings the company derives from its commercial original equipment manufacturer (OEM), aftermarket, and industrial customers to be weaker than the rating agency previously expected in fiscal year 2020 (ending Oct. 3, 2020) due to the reduced demand stemming from the coronavirus pandemic. Commercial OEM (17% of revenue) demand will decline because Boeing and Airbus have cut their build rates and S&P expects they will remain low for some time. S&P also expects Moog's commercial aftermarket (5%) demand to drop due to the lower level of air traffic. It also expects the company to report reduced demand in its industrial (22%) business due to lower spending amid the pandemic, including in its Simulation and Test, which provides flight simulators, and automation segments. However, S&P expects Moog's military (39%), space (9%), and medical (8%) revenue to be relatively unaffected. Overall, S&P forecasts that the decline in the company's earnings and cash flow will lead it to report a funds from operations (FFO)-to-debt ratio in the 21%-25% range for fiscal years 2020 and 2021, which compares with its 33.7% ratio in fiscal year 2019 and the rating agency's previous expectation for a ratio in the 28%-32% range. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety The negative outlook reflects that, while S&P expects Moog's credit metrics to remain appropriate for the current rating, the effects of the coronavirus pandemic could be more severe than the rating agency expects and weaken the company's earnings and cash flow. S&P expects the company's FFO to debt to be in the 21%-25% range for fiscal years 2020 and 2021. "We could lower our ratings on Moog if its FFO to debt declines below 20% over the next 12 months and we do not expect it to recover. This would likely occur due to greater-than-expected headwinds from the coronavirus on the company's commercial aerospace or industrial operations, further delays in the recertification of the 737 MAX, or significant disruptions to its operations due to health concerns. This could also occur if the company adopts a more aggressive financial policy than we expect," S&P said. "We could revise our outlook on Moog to stable over the next 12 months if we expect its FFO to debt to remain above 20%. This would likely occur if its demand is not materially weaker than we expect and the company limits its shareholder returns and acquisitions," the rating agency said. NAMB & ASSOCIATES: Hires Warshaw Bursten as Real Estate Counsel --------------------------------------------------------------- Namb & Associates, Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of New York to employ Warshaw Bursten LLP as its special real estate counsel. Services to be rendered by Warshaw are: (a) assist the Debtor with respect to negotiations with the Mortgage Lender and new lenders to refinance the Debtor's real property; (b) resolve any tax liens encumbering the real property; (c) represent Debtor in the real estate litigation and any other real estate matter involving the Debtor; (d) work closely with the Debtor's proposed bankruptcy counsel, Ballon Stoll Bader & Nadler PC, to ensure that there is no duplication of work. Warshaw's hourly rates are: Partners/Members $445 - $695 Associates $310 - $495 Paralegals $190 - $305 On March 12, 2020 the Debtor paid $5,000 to Warshaw as a pre-petition retainer deposit. Kawall Deosaran of Warshaw assures the court that his firm does not hold or represent any interest adverse to Debtor, its creditors or Debtor's estate, and is a disinterested person within the meaning of Sec. 101(14) of the Bankruptcy Code. The firm can be reached through: Kawall Deosaran, Esq. WARSHAW BURSTEIN, LLP 575 Lexington Avenue, 7th Floor New York, NY 10022 Tel: 212-984-7700 Fax: (212) 972-9150 About Namb & Associates Namb & Associates, Inc., a company based in Manhasset, New York, sought protection under Chapter 11 of the Bankruptcy Court (Bankr. E.D.N.Y. Case No. 20-71595) on March 12, 2020. The petition was signed by Kawall Deosaran, its president. At the time of the filing, the Debtor disclosed estimated assets of $1 million to $10 million and estimated liabilities of the same range. The Debtor tapped Pankaj Malik, Esq., of Warsaw Burstein, LLP and Ballon Stoll Bader & Nadler PC as its counsel. OAK LAKE: July 7 Plan Confirmation Hearing Set ---------------------------------------------- On May 4, 2020, Oak Lake, LLC filed with the U.S. Bankruptcy Court for the Northern District of Georgia, Atlanta Division, an Amended Disclosure Statement referring to the Chapter 11 Plan. On May 15, 2020, Judge Barbara Ellis-Monro ordered that: * The Amended Disclosure Statement is approved and the Debtor is directed to remove the bank statements and insurance statements attached to the Debtor's March 2020 Operating Report, and substitute it as Exhibit "B" to the Disclosure Statement, before distribution with the Plan. * June 29, 2020 is fixed as the last day for filing ballots indicating written acceptances or rejections of the Plan. * July 7, 2020 at 11:00 a.m. in Courtroom 1402, United States Courthouse, 75 Ted Turner Drive, S.W., Atlanta, Georgia 30303 is fixed as the time for the hearing on confirmation of the Plan. * June 29, 2020 is fixed as the last day for filing and serving written objections to confirmation of the Plan. A copy of the order dated May 15, 2020, is available at https://tinyurl.com/ydy48olp from PacerMonitor at no charge. The Debtor is represented by: THEODORE N. STAPLETON, PC Theodore N. Stapleton Suite 100-B 2802 Paces Ferry Road Atlanta, Georgia 30339 Tel: (770) 436-3334 E-mail: tstaple@tstaple.com About Oak Lake LLC Oak Lake LLC owns and operates a skilled nursing care facility in Grove, Oklahoma. Oak Lake LLC filed its voluntary Chapter 11 petition (Bankr. N.D. Ga. Case No. 19-67517) on Nov. 1, 2019. In the petition signed by Christopher F. Brogdon, manager, the Debtor was estimated to have $1 million to $10 million in both assets and liabilities. Judge Barbara Ellis-Monro is assigned to the case. Theodore N. Stapleton, P.C., is the Debtor's legal counsel. PARKING MANAGEMENT: Taps JW Infinity as Financial Advisor --------------------------------------------------------- Parking Management, Inc. received approval from the U.S. Bankruptcy Court for the District of Maryland to employ JW Infinity Consulting, LLC as its financial advisor. The firm's services will include: (a) reviewing Debtor's schedules of assets and liabilities and statement of financial affairs; (b) preparing a liquidation analysis and projections with respect to Debtor's ability to make payments for purposes of a plan of reorganization; and (c) any other financial advice Debtor may require. The firm has requested a $50,000 retainer. Jolene Wee, managing member and founder of JW Infinity, 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: Jolene Wee JW Infinity Consulting, LLC 447 Broadway Street 2nd FL #502 New York, NY 10013 Telephone: (646) 204-0033 Facsimile: (646) 810-3989 Email: jwee@jw-infinity.com About Parking Management Parking Management, Inc. is a parking operator in Washington, DC. It operates 88 leased or managed properties throughout the Washington, DC and Baltimore metropolitan areas, specializing in complex mixed-use properties and has experience in all levels of commercial and residential parking operations. Visit https://www.pmi-parking.com Parking Management sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 20-15026) on May 7, 2020. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge Thomas J. Catliota oversees the case. Debtor is represented by Shulman, Rogers, Gandal, Pordy & Ecker, PA. JW Infinity Consulting, LLC is Debtor's financial advisor. PARTY CITY: Moody's Cuts Senior Unsec. Notes to Ca, Outlook Neg. ---------------------------------------------------------------- Moody's Investors Service downgraded Party City Holdings Inc.'s probability of default rating to Ca-PD from Caa1-PD, its senior unsecured notes to Ca from Caa2, and senior secured term loan to Caa1 from B3. The corporate family rating was affirmed at Caa1. The speculative grade liquidity rating is SGL-3. The outlook is negative. The downgrades reflect Party City's announcement on May 29, 2020 that it had entered into a Transaction Support Agreement [1] with holders representing more than 52% of the total principal amount of its $350 million 6.125% senior unsecured notes due 2023 and its $500 million 6.625% senior unsecured notes due 2026. If the transaction is consummated as outlined, it will constitute a distressed exchange, which is an event of default under Moody's definition. Moody's expects to upgrade the PDR to Caa1-PD/LD should the transaction close as proposed and subsequently the LD designation will be removed after three business days. Despite the reduction in consolidated debt and interest cost savings, the downgrade of the senior secured term loan reflects the elimination of the unsecured notes (approximately 50% of total debt) that provided loss absorption for the term loan as well as the proposed addition of more secured debt. The TSA contemplates an exchange offer whereby existing holders will receive: 1) common shares of Party City representing 19.9% of common shares outstanding; 2) $100 million of new 10% second lien notes due 2026 issued by a newly formed limited liability company (wholly owned by Party City) and Anagram International, Inc.; and, 3) $185 million of variable rate first lien notes due 2025 to be issued by Party City that share the same collateral as the existing bank term loan lenders. Moody's estimates recovery for the senior unsecured notes is approximately 35% assuming a $1.15/share stock price. The exchange offer is expected to commence in June and close in July subject to achieving a minimum 98% participation ($833 million) of the aggregate principal amount ($850 million) of the existing unsecured notes. Party City will designate the newly formed limited liability company and Anagram International Inc. which holds the company's metallic balloon business as an unrestricted subsidiary, thereby removing the asset from the existing restricted group. Anagram accounted for approximately 6% and 9% of Party City's consolidated 2019 revenues and EBITDA, respectively. The newly formed limited liability company and Anagram International will also issue new money first lien notes aggregating $100 million due 2025 for payment of a special dividend to Party City to bolster its liquidity position. If consummated, the exchange offer will be reduced consolidated debt by a $450 million. Downgrades: Issuer: Party City Holdings Inc. Probability of Default Rating, Downgraded to Ca-PD from Caa1-PD Senior Secured Bank Credit Facility, Downgraded to Caa1 (LGD3) from B3 (LGD3) Senior Unsecured Regular Bond/Debenture, Downgraded to Ca (LGD5) from Caa2 (LGD5) Affirmations: Issuer: Party City Holdings Inc. Corporate Family Rating, Affirmed Caa1 Outlook Actions: Issuer: Party City Holdings Inc. Outlook, Remains Negative RATINGS RATIONALE Party City's Caa1 corporate family rating reflects Moody's expectation that the proposed transaction support agreement will result in an approximate net $450 million reduction in consolidated funded debt and a $17.4 million reduction in consolidated interest expense, inclusive of the unrestricted subsidiary, Anagram. Pro-forma Moody's adjusted consolidated debt/EBITDA is estimated to drop to 4.8x from 5.8x and EBIT/interest to improve to 1.4 from 1.3x. The improvement in credit metrics and liquidity from lower interest expense and new money puts the company in a better position to refinance its term loan due 8/19/2022. Party City Holdings Inc. is constrained by weakened operating performance prior to the pandemic including increased competition, elevated helium prices, and tariffs that took a significant toll on margins in 2019. Credit metrics will deteriorate, despite the exchange offer, in 2020 due to lower EBITDA resulting from COVID-19 store closures. Moody's estimates revenue and earnings will recover in 2021 with Moody's adjusted leverage improving to between 5x-5.5x assuming the proposed transaction closes and the company's EBITDA recovers to around 90% of 2019 levels. Party City is exposed to changing demographic and societal trends, including the shift of consumers purchasing goods and accessories online. The rating is supported by Party City's strong market presence in both retail and wholesale, geographic diversification, and historically more stable party goods and accessories segment. 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 Non-food retail sector will be one of the sectors most significantly affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in the credit profile of the Non-food retail sector, including their exposure to store closures and discretionary consumer spending have left them vulnerable to shifts in market sentiment in these unprecedented operating conditions and the companies remain vulnerable to the outbreak continuing to spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The negative outlook reflects uncertainty of the exchange offer closing, the expected slow pace of store re-openings and weak consumer demand in light of the severe shock to the US economy caused by the pandemic and the need to refinance the term loan which becomes current in August 2021 closures. FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS: The ratings could be downgraded if the proposed exchange offer does not close on announced terms, if the ramp up of store re-openings stalls or if the probability of default increases for any reason. Quantitatively, ratings could be downgraded if debt/EBITDA is sustained above 7.25x or EBIT/interest declines to .5x. Ratings could be upgraded once the impact of coronavirus has abated and operating performance has improved such that debt/EBITDA is sustained below 6.5x and EBITA/interest expense approached 1.0x. An upgrade would also require the company to address its refinancing needs. The principal methodology used in these ratings was Retail Industry published in May 2018. PENNSYLVANIA ECONOMIC DEVELOPMENT: S&P Cuts Rev. Bond Rating to B+ ------------------------------------------------------------------ S&P Global Ratings lowered its underlying rating (SPUR) on the Pennsylvania Economic Development Financing Authority's (PEDFA) $106 million--bonds outstanding and accreted interest--series 2013A senior parking revenue bonds to 'B+' from 'BB+'. The outlook is negative. The bonds financed the acquisition of various off-street and on-street parking assets from the Harrisburg Parking Authority and the City of Harrisburg in Harrisburg, Pa., and are secured by gross revenues of the parking system. "The downgrade reflects our view that the parking system is more vulnerable to nonpayment of debt service requirements than higher-rated entities due to the severe and ongoing impacts associated with the COVID-19 pandemic, which we expect will further exacerbate low parking utilization rates and materially weaken parking system revenues," said S&P Global Ratings credit analyst Kevin Archer. "While the system currently has capacity to meet its financial commitments on existing obligations, we believe the lingering weak operational performance and ongoing adverse economic conditions brought on by the current economic recession will impair the obligor's financial capacity to meet its future commitments on all its obligations." The rating reflects S&P's opinion of the parking system's adequate enterprise profile and highly vulnerable financial risk profile. S&P's financial risk profile is based on its expectation that debt service coverage, per its calculations, will be insufficient in fiscal 2020 (December year-end) based on net operating revenues of the parking system and lack of available liquidity that, together, will likely require material draws from a $38.6 million surety-funded debt service reserve fund (DSRF) to meet debt service requirements totaling about $16.1 million in fiscal 2020. The combined DSRF balance includes $12.8 million for the series 2013A bonds, $15.0 million for the 2013B bonds, and $10.8 million for the 2013C bonds. Excluding the DSRF, management reported the lack of any additional available liquidity for near-term debt service requirements and operational cash flow needs. While management indicates that its upcoming July 1 interest payment will not require a draw from the DSRF and will be paid from operating cash flow, the principal payment due on Jan. 1, 2021, will likely require a draw from the DSRF as its current shortfall is $272,000 through May 2020 with seven months remaining. Furthermore, S&P expects the parking system will remain vulnerable to sufficiently meeting all of its financial obligations in fiscal 2021 as a result of escalating debt service requirements, accrued liabilities related to the reimbursement payments to Dauphin County as a result of likely future draws on the DSRF, and depressed parking utilization rates. S&P's rating action incorporates its opinion regarding the health and safety risks posed by the COVID-19 pandemic, which it views as a social factor under its environmental, social, and governance factors, causing significant operating and financial pressures for the parking system. Furthermore, S&P believes social risks present ongoing operational challenges and constrain the parking system's rate-setting flexibility and financial performance due to its location in an economically weaker service area, given affordability issues and significant competition, resulting in low parking utilization rates. S&P believes environmental and governance risks are in line with the sector. It analyzed the parking system's risks related to environmental and governance factors, and consider them to be in line with the rating agency's view of the sector standard. The negative outlook reflects S&P's expectation that it could lower the rating within two years or possibly within 12 months, depending on the severity and duration of the COVID-19 outbreak and associated impacts on parking operations. Currently, the parking system has a consolidated, all-inclusive debt position of approximately $337.2 million to include bonds payable, promissory notes, accreted interest, and capital lease obligations. PETROCHOICE HOLDING: S&P Affirms 'B-' ICR; Outlook Negative ----------------------------------------------------------- S&P Global Ratings affirmed all its ratings on PetroChoice Holding Inc., including its 'B-' issuer credit rating, with its negative outlook that it assigned April 2, 2020. Business disruptions resulting from the COVID-19 pandemic has resulted in a significant decline in Petrochoice's operating performance. Although there continues to be significant uncertainty around the length of the current pandemic, Petrochoice's operating performance will continue to suffer over the next few months as its customers facilities slowly reopen from the COVID-19-related shutdowns. Under S&P' base case, it assumes gross profit declines by 18%, EBITDA margins decline more than 300 basis points (bps), and adjusted debt to EBITDA jumps to over 11x in 2020. Passenger vehicle end-markets will rebound slightly before industrial manufacturing and commercial fleet end-markets. For 2021, S&P expects a cyclical rebound in gross profit of about 12% as passenger vehicle miles driven recover, and as the company leverages its strong relationship with Exxon Mobil Corp. to capitalize on shifts in demand from conventional to synthetic motor oil. S&P acknowledges a high degree of uncertainty about the rate of spread and peak of the coronavirus outbreak. Some government authorities estimate the pandemic will peak about midyear, and S&P is using this assumption in assessing the economic and credit implications. S&P believes the measures adopted to contain COVID-19 have pushed the global economy into recession. As the situation evolves, S&P will update its assumptions and estimates accordingly. Although the company is in compliance with its springing financial maintenance covenant, its covenant headroom will likely fall below 5% at September 30, 2020. Petrochoice's revolving credit facility is governed by a springing first-lien leverage covenant. The covenant springs when borrowings exceed $18 million or $12 million starting at the Sept. 30, 2020 test period when total revolver commitments decline to $40 million from $60 million. Following a 2019 amendment, the covenant was relaxed to 6.5x (from 4.5x previously). Although PetroChoice has generally drawn on less than 30% of the revolver's commitment, and S&P forecasts sufficient cash balances to reduce the revolver below its test level at the second quarter 2020 test period, it forecasts the covenant will be tested in the subsequent periods. S&P expects PetroChoice's headroom will deteriorate in the third and fourth quarter 2020 such that a 4% to 5% decline (about $2 million) in the credit agreement definition of adjusted EBITDA relative to the rating agency's forecast could result in a covenant breach. The rating agency expects this margin to expand beyond 20% through 2021 as operating performance recovers. The covenant has no step-downs from 6.5x. In the event of a covenant breach S&P expects the company to pursue an equity cure or a waiver from lenders; however, it has not yet pursued either. The company has demonstrated success negotiating with lenders in the recent past. In March 2019, PetroChoice amended and extended the revolving credit facility and obtained covenant relief which increased the permitted first-lien leverage ratio from 4.5x to 6.5x. PetroChoice's liquidity will be pressured in 2020 but cash and revolver availability could trough around $20 million in the second half of 2020. S&P expects the company's total unrestricted cash and revolver availability will decline significantly in the upcoming months and quarters, as earnings decline sharply year on year, and $20 million of the company's $60 million revolving credit facility matures on Aug. 21, 2020, leaving $40 million in revolving credit commitments available through August 2022. S&P expects working capital investment will increase as the company builds inventory to meet increasing customer demand, which should rebound steadily from the lows experienced in the second quarter of 2020. Historically, opportunistic inventory builds in advance of supplier price increases have caused significant fluctuations in working capital needs, as high as $16.3 million in the second quarter of 2019. Nevertheless, modest and flexible capital expenditures (capex) and low cash tax payments should provide liquidity support and allow the company to maintain at least $20 million in total cash and revolving credit borrowing capacity through 2021, which S&P forecasts will be sufficient to support debt service and fund business re-investment. Environmental and Social Governance -- Health and safety The negative outlook reflects the expected tight covenant headroom and the risk that demand might not recover in the second half of 2020 in line with S&P's base case projections. S&P could lower its rating if gross profits declines fail to moderate in the third quarter 2020, such that it forecasts: -- Sustained free cash flow deficits, -- Liquidity sources falling below $10 million; or -- A covenant breach. In S&P's downgrade scenario, third quarter 2020 gross profit declines exceed 30% year on year amid persistent macroeconomic weakness, or large inventory builds pressure cash balances. S&P could also lower the ratings should it come to view PetroChoice's capital structure as unsustainable or expect a distressed debt exchange or payment default. S&P could revise the outlook to stable if it expects PetroChoice will demonstrate good operating performance with positive free cash flow generation, ample covenant and liquidity cushion, and adjusted leverage beneath 7x. PGX HOLDINGS: S&P Ups ICR to 'CCC+' on Revised Credit Agreement --------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Utah-based PGX Holdings Inc. (d/b/a Progrexion) to 'CCC+' from 'D', its first-lien issue-level rating to 'B-' from 'D,' and second-lien term loan issue-level rating to 'CCC-' from 'D.' The recovery ratings are unchanged. The upgrade follows Progrexion's amendment to its credit agreements which, among other things, reduces its annual cash interest payments by $10 million and improves its cash flow, and extends its existing debt maturities by three years. "The rating on Progrexion reflects our view that the company's capital structure is unsustainable absent a significant improvement in its operating performance, given the high pay-in-kind interest burden and expected debt accretion, and the business uncertainties," S&P said. S&P believes underperformance in revenue and EBITDA, which started in 2019 due to lower-than-expected client volumes, will persist in 2020, resulting in leverage well above 7x over the rating agency's two-year forecast period. Under its base case, S&P projects revenues to decline 10% in 2020 and free operating cash flow deficits of about $2-7 million. Moreover, uncertainty regarding the outcome of the Consumer Financial Protection Bureau (CFPB) litigation that would require the company to charge its customers six months after consumer credit reports are updated; Google's decision to restrict paid advertisements from for-profit credit repair service providers in late 2019, which could be a competitive disadvantage compared to not-for-profit companies; and the current COVID pandemic and economic recession all resulted in the lowering for S&P's business profile assessment. Nevertheless, the recent debt amendments alleviates near-term liquidity concerns. Despite S&P's view on the debt capitalization, free operating cash flow (FOCF) should improve in 2021 to the $25 to $35 million range because of its recent debt restructuring. Changes to the credit agreements include: -- Reducing its annual cash interest by about $10 million. --Interest on the first-lien credit agreement was revised to cash interest of LIBOR+5.25% and payment-in-kind (PIK) 4.25% from cash interest of LIBOR+5.25%. --Interest on the second-lien credit agreement was revised to PIK LIBOR+14.75% from cash interest of LIBOR+9%. -- A $12.5 million repayment of first-lien term loan due March 29, 2024 was made with most of the proceeds from a new $15.85 million 1.5-lien term loan (now ranked as second-priority) from its financial sponsor, H.I.G. Capital (PIK interest of LIBOR+10.5%). -- Increase in the mandatory amortization on the first-lien term loan on a fluctuating schedule with $6.24 million in the first twelve months starting June 30, 2020 and 75% quarterly excess cash flow sweep. -- A three-year extension of the maturity date of the existing first-lien term loan to September 2023 and second-lien term loan to September 2024; and -- Loosening of the total net total leverage ratio and a new minimum liquidity requirement of $10 million commencing May 31, 2020. The net leverage test period starts March 31, 2021. The covenant is initially set at 12.7x and steps down every quarter over the term of the agreement to 6.5x. At Dec. 31, 2021, the covenant is set at 9.6x. The negative outlook reflects the risk that operating challenges persist over the next 12 to 24 months as the company continues to execute its turnaround plan, increasing the risk that it fails to grow into its capital structure and requires another debt restructuring. S&P could lower the rating if execution missteps, a prolonged economic recession, or slower-than-expected business recovery leads to high cash flow deficits that increase the likelihood of a liquidity shortfall, covenant breach, or payment default. S&P could revise the outlook to stable if it believes it is on track to improve its operating performance with limited interruption through the current litigation proceedings and maintain ample liquidity to weather any potential COVID-related disruption. PLAINS ALL: Moody's Rates New Senior Unsecured Notes 'Ba1' ---------------------------------------------------------- Moody's Investors Service assigned a Ba1 rating to Plains All American Pipeline L.P.'s proposed senior unsecured notes. Plains' other ratings and positive outlook remain unchanged. Plains' announced unsecured debt issuance will be used to partially repay the principal amounts of its $600 million 5.00% senior notes due in 2021 and, pending such repayment, for general partnership purposes. "These notes offering would be debt neutral for Plains," said Arvinder Saluja, Moody's Vice President. "Despite the slowdown in the Permian and other crude producing US basins, Plains' leverage profile is likely to remain supportive of its current rating and outlook as Moody's expects the crude pipeline volumes to start recovering in the second half of 2020. On the other hand, further volume declines would put pressure on the positive rating outlook." Assignments: Issuer: Plains All American Pipeline L.P. Senior Unsecured Notes, Assigned Ba1 (LGD4) RATINGS RATIONALE The positive outlook reflects Moody's view that leverage will remain moderate with volumes and EBITDA starting to recover in the second half of 2020 and improving to the point in 2021 where Plains is able to sustainably achieve its rating upgrade targets in a more supportive commodity price environment. The outlook could be changed to stable from positive if commodity prices do not continue improving in the second half of 2020 and into 2021. Plains' Ba1 Corporate Family Rating benefits from its large scale and geographic asset diversification across key North American oil producing regions and EBITDA growth in the transportation business that has supported deleveraging. The credit challenges include volume risk that exposes cash flow to changing market dynamics arising from crude production levels, and the MLP model subject to a high distribution payout. The proposed and existing Plains' senior notes and its $1.6 billion revolving credit facility due August 2024 are issued at the parent level and are unsecured. Most of the senior notes have no subsidiary guarantees. The senior notes are rated the same as Plains' Ba1 Corporate Family Rating since Plains' unsecured debts are pari passu in its capital structure, and constitute the vast majority of the company's indebtedness. The $1.4 billion senior secured hedged inventory facility due August 2022 has a priority preference over the senior notes; however, because of the small size of the latter facility compared to the total amount of senior notes (roughly $9 billion), the notes are rated the same as the CFR. The preferred units are rated Ba3 reflecting their effective subordination to all of the proposed and existing senior unsecured debt and the senior secured hedged inventory facility. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded if the company continues demonstrating maintenance of a balanced approach to capital allocation. Specifically, an upgrade will depend on debt/EBITDA sustainably remaining below 4.5x (including Moody's standard adjustments, 50% debt treatment for the preferred units and a normalized level of Supply & Logistics segment EBITDA) and distribution coverage consistently above 1.3x despite high capital spending needs. The ratings could be downgraded if leverage (excluding S&L EBITDA) increases above 5x, or if distribution coverage approaches 1x. The principal methodology used in these ratings was Midstream Energy published in December 2018. Plains All American Pipeline L.P., headquartered in Houston, Texas, is engaged in the transportation, terminalling and storage of crude oil, natural gas liquids and natural gas throughout North America. PROLINE CONCRETE: U.S. Trustee Objects to Plan Disclosures ---------------------------------------------------------- William K. Harrington, the United States Trustee for Region 2, filed an objection to the Disclosure Statement of Proline Concrete of WNY, Inc. The U.S. Trustee points out that the Debtor provides no meaningful information regarding its financial performance during its chapter 11 proceeding. The U.S. Trustee further points out that the Debtor provides no financial projections. The U.S. Trustee asserts that upon information and belief, the Debtor may not be able to fully perform under the Plan unless it is substantially successful in the Crisalli Legal Actions. About Proline Concrete of WNY Proline Concrete of WNY, Inc. filed a chapter 11 petition (Bankr. W.D.N.Y. Case No. 16-11455) on July 25, 2016. The petition was signed by James R. Sickau, president. At the time of the filing, the Debtor was estimated to have assets and debts at $1 million to $10 million. The case is assigned to Judge Carl L. Bucki. The Debtor is represented by Arthur G. Baumeister, Jr., Esq., at Amigone, Sanchez & Mattrey LLP. QEP RESOURCES: Moody's Cuts Rating on Sr. Unsecured Notes to B3 --------------------------------------------------------------- Moody's Investors Service downgraded QEP's Resources Inc.'s senior unsecured notes rating to B3 from B2. The downgrade follows the amendment of its revolving credit facility. At the same time, Moody's affirmed QEP's B2 corporate family rating and its B2-PD probability of default rating. The Speculative Grade Liquidity rating remains SGL-3. The rating outlook remains negative. "The changes provided for in the credit agreement amendment necessitate subsidiary guarantees for QEP's revolver, but not for its existing senior notes, creating structural subordination for the latter," said Arvinder Saluja, Moody's Vice President. "However, the amendment also increases the company's financial flexibility through making the revolver availability more certain during this period of weak commodity prices by introducing more lenient financial covenants." Downgrades: Issuer: QEP Resources, Inc. Senior Unsecured Notes, Downgraded to B3 (LGD4) from B2 (LGD4) Affirmations: Issuer: QEP Resources, Inc. Probability of Default Rating, Affirmed B2-PD Corporate Family Rating, Affirmed B2 Outlook Actions: Issuer: QEP Resources, Inc. Outlook, Remains Negative RATINGS RATIONALE QEP's senior notes and revolving credit facility are all issued at the parent level and are unsecured. However, the amended revolver now has subsidiary guarantees, causing the senior notes to be downgraded to B3, or one notch lower than QEP's B2 CFR, due to their structural subordination to the revolver. QEP's B2 CFR is challenged by its high capital intensity, execution risk as it continues to develop its Permian acreage and grow production while countering decline in Williston Basin production, and lowered ability to refinance its near term debt maturities amidst less favorable capital markets. The rating also reflects the company's high financial leverage as measured against reserves and production. The CFR is supported by its combined production and reserve base in the Permian and Williston basins, which provide basin diversification and oil-focused economics, and its lower exposure to natural gas production after the divestiture of Uinta and Haynesville assets. The ratings also benefit from good 2020 retained cash flow to debt and interest coverage metrics, which are supported by the company's hedge portfolio. However, these metrics will deteriorate in 2021 as hedges roll off and if the commodity prices do not significantly improve. QEP's SGL-3 rating reflects Moody's expectation that the company will maintain adequate liquidity into 2021. As of March 31, 2020, the company had $70 million in cash on the balance sheet and no borrowings under its amended unsecured revolving credit facility, which matures in September 2022. Although the commitments under the facility were reduced to $850 million from $1.25 billion, QEP's ability to access the credit facility was limited due to the likelihood of lowered compliance headroom under its previous covenants, mainly the present value to Net Debt (at least 1.50x requirement) covenant. Under the new covenant requirements, QEP's ability to access the credit facility is enhanced. The amended financial covenants require minimum liquidity of $100 million at all times, Net Priority Guaranteed Leverage Ratio of less than 2.50x, and PV-9 to Net Priority Guaranteed Leverage Ratio of greater than 1.50x. Moody's expects QEP to maintain strong headroom under the amended covenants at least through 2021. Moody's expects the company to have breakeven free cash flow from operations in 2020, while needing to draw on the revolver only for small amounts. The company's next maturities are in March 2021 with $332 million of senior notes coming due and in October 2022 with $465 million of senior notes coming due. With the revised credit facility, QEP has the ability to repurchase up to $500 million of senior outstanding notes using its revolver, subject to certain leverage and PV-9 coverage requirements. QEP has some alternative liquidity since the credit facility is unsecured, but the allowed asset sales to raise cash will be more limited under the amended credit facility than in the past. The negative outlook reflects the increased likelihood that low energy prices and tight capital market conditions could prevail for an extended period of time. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS QEP's ratings will likely be downgraded if the company is unable to substantially reduce its refinancing risks in a timely manner, if retained cash flow to debt falls below 15%, if the leveraged full-cycle ratio drops below 1x, or if the company undertakes any actions that are deemed by Moody's to be a distressed exchange of debt. The change of outlook to stable and/or a positive rating action would be contingent upon QEP's ability to substantially mitigate refinancing risk, maintaining the leveraged full-cycle ratio above 1.5x and reduce debt leading to a sustainable RCF/Debt over 25%. A more supportive oil and gas price environment will also be needed for considering an upgrade. The principal methodology used in these ratings was Independent Exploration and Production Industry published in May 2017. QEP Resources, Inc. is a publicly traded independent crude oil and natural gas exploration and production company focused in two regions, North Dakota and Texas. QUEENS BALLPARK: S&P Cuts Bond Ratings to 'BB+' ------------------------------------------------ S&P Global Ratings is lowering its ratings to 'BB+' from 'BBB' on New York City Industrial Development Agency's (NYCIDA) series 2006 $547.4 million payment-in-lieu-of-taxes (PILOT) bonds, $58.4 million installment purchase bonds, $7.1 million lease revenue bonds, and series 2009 $82.28 million PILOT bonds issued for Queens Ballpark Co. LLC (QBC). S&P also assigned a recovery rating of '1', reflecting its expectation for very high (90-100%; rounded estimate: 95%) recovery in the event of a default. QBC operates Citi Field, a 42,000-seat, open-air baseball stadium in Queens, N.Y., that is home to MLB's New York Mets. NYCIDA owns the ballpark and leases it under a long-term agreement to QBC. The initial lease expires alongside the final debt maturity. QBC is a wholly owned subsidiary of Sterling Mets L.P., which owns the Mets. QBC's stadium-use agreement with the Mets requires the team to play substantially all of its home games in the stadium. Ballpark operating rights are conveyed to QBC under the lease. The project keeps the retained rights revenue and passes all other stadium revenue to Sterling Mets L.P. under the stadium-use agreement. Retained rights revenue includes luxury suite premiums, specific seats, concessions, merchandise, signage, advertising, naming rights, and specific parking revenue. The NYCIDA is servicing the PILOT bonds, installment purchase bonds, and lease revenue bonds with the payments it receives from QBC. QBC uses the retained rights revenue to fund its PILOT, installment purchase, and rent payments. QBC and Sterling Mets L.P. covenant not to materially change the retained rights. Amendments to the lease and use agreements require independent approval from the bond insurer and NYCIDA, respectively. S&P is lowering the rating on QBC by two notches based on the unique operational challenges the pandemic has caused on the 2020 MLB season. The rating agency considers the impact of the pandemic to be a health and safety issue, related to its environmental, social and governance (ESG) factors. Game-day revenues will likely be sharply lower because of COVID-19, and recovery in 2021 is uncertain. S&P doesn't expect fans to return to the stands until at least September and stadiums will almost certainly be subject to some form of social distancing requirements. As a result, S&P projects game-day revenues will fall up to 85% in 2020 from 2019 levels. Further cancellations, stringent but as yet unspecified social distancing measures are likely (including games being played with no fans), and 2021 projections while lower are also difficult to forecast but could be affected by a continued pandemic and recession. The MLB and MLB Players Association are trying to reach an agreement regarding the 2020 season. A potential agreement should bring clarity on the extent of cancellations in the season, or, in the worst-case scenario, cancellation of the entire season, as well as any social distancing required once games begin. Once S&P has this additional clarity, it will update its financial forecasts. Team-supported ticket credits/refunds could insulate QBC from some operating cash-flows losses, but the project would still be exposed to other game-day revenue losses such as food and beverage, merchandise, and parking. A combination cash on hand and liquidity can keep the project afloat until June 2021. S&P estimates cash and liquidity in the form of its debt service reserve can cover operations and maintenance (O&M) and debt service obligations for QBC if the entire 2020 season is canceled, and if this occurred would be sufficient to support the first of two debt service obligations in 2021. An insufficient liquidity position could expose QBC to additional financial risk if a 2022 MLB players strike occurs.If liquidity is drawn this year or next, the replenishment of the debt service reserve, if used, is unlikely to be quick. The current collective bargaining agreement with players sunsets at the end of 2021, and if a players strike occurred, pre-existing 2020 or 2021 draws on the debt service reserve account may not be adequate to support the stadium through the strike. Management has indicated the team is likely to provide equity support rather than draw on the reserves and that the team has strong economic incentives to support the stadium. However, S&P has no insight into the team's financial ability to do so, and no formal support agreement exists. While it will consider any ex-post cash injections into the stadium, S&P's forecast liquidity balances assumes the stadium has to manage through this unprecedented disruption using its own stand-alone resources. Environmental, social, and governance (ESG) factors relevant to the rating action: -- Social--health and safety The CreditWatch negative placement reflects S&P's concerns over the continued impact COVID-19 is having on QBC given that MLB is likely to cancel a significant portion of the 2020 season, that the 2021 season could entail limited attendance due to social distancing, and that destabilization could extend into 2022, a potential strike year. Using debt service reserves may be necessary as early as December as S&P does not assume or rely on any team support. Additional draws could occur in 2021, depending on how the revenue profile unfolds. Beginning with the anticipated MLB announcement, S&P is expecting to gradually clarify the extent of cancellations in the season, including potential cancellation of all fan-attended games, as well as any social distancing requirements once games begin, and refine and publish S&P's financial forecast as a function of its assessment of QBC. S&P could lower the rating if it concludes there is likely to be a substantial draw on reserves to pay debt service in 2020 and 2021. S&P expects to maintain the CreditWatch negative listing at least through the summer; a stable outlook is unlikely until it has more confidence in whether fans will return in numbers sufficient to support DSCRs consistent with the current ratings. S&P will publish its financial projections once it has sufficient information to model the next two years. For now, S&P's action is based on its view that liquidity could weaken. RAINIER PROPERTIES: Case Summary & Unsecured Creditors ------------------------------------------------------ Three affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Rainier Properties International, Inc. 20-12136 2415 Comstock Ct Naperville, IL 60564 Rainier International, LLC 20-12137 Monaco International, LLC 20-12138 Chapter 11 Petition Date: June 9, 2020 Court: United States Bankruptcy Court Northern District of Illinois Judge: Hon. David D. Cleary Debtors' Counsel: Paul M. Bach, Esq. BACH LAW OFFICES, INC. P.O. Box 1285 Northbrook, IL 60065 Tel: (847) 564-0808 Email: pnbach@bachoffices.com Rainier Properties' Estimated Assets: $1 million to $10 million Rainier Properties' Estimated Liabilities: $1 million to $10 million Rainier International's Estimated Assets: $100,000 to $500,000 Rainier International's Estimated Liabilities: $100,000 to $500,000 Monaco International's Estimated Assets: $100,000 to $500,000 Monaco International's Estimated Liabilities: $100,000 to $500,000 The petitions were signed by Sameh Abadeer, officer and manager. Full-text copies of the petitions containing, among other items, lists of the Debtors' unsecured creditors are available for free at PacerMonitor.com at: https://is.gd/FRTehC https://is.gd/6G5Mbg https://is.gd/6LILuJ RAVN AIR: Auction of Substantially All Assets Approved ------------------------------------------------------ Judge Brendan L. Shannon of the U.S. Bankruptcy Court for the District of Delaware authorized the bidding procedures of Ravn Air Group, Inc. and affiliates in connection with the auction sale of substantially all assets. Those portions of the Motion asking approval of the Bidding Protections, the Notice Procedures, and setting the time, date and place of the Sale Hearing are granted as modified in the Order, and the Objection is overruled except as set forth therein. The Sale Notice is approved. Immediately after entry of the Bidding Procedures Order (or as soon as reasonably practicable thereafter), the Debtors (or their agent) will serve the Sale Notice upon the Sale Notice Parties. The Contract Procedures, including the form of Cure Notice, are authorized, approved, and made part of the Order. The Debtors will serve the Cure Notice upon each counterparty to the Initial Purchased Contracts by no later than June 18, 2020. The Assumption Objection Deadline is 4:00 p.m. (ET) on June 26, 2020. The Debtors will file a notice of the Successful Bidder within 24 hours of the conclusion of the Auction and send such notice by overnight mail to all counterparties of Purchased Contracts. Subject to the Bidding Procedures and approval at the Sale Hearing, the Debtors' entry into one or more Stalking Horse Agreements, subject to higher and better bids, is authorized. No Sale will be approved without the consent of the DIP Lenders. For the avoidance of doubt, the FAA Operating Certificate is non-transferable. The Order will be effective immediately upon entry, and any stay of orders provided for in Bankruptcy Rules 6004 or 6006 or any other provision of the Bankruptcy Code or Bankruptcy Rules is expressly lifted. The Debtors are not subject to any stay in the implementation, enforcement or realization of the relief granted in the Order, and may, in their discretion and without further delay, take any action and perform any act authorized under the Order. The sale of the Assets will be on an "as is, where is" basis and without surviving representations or warranties of any kind, nature, or description by the Debtors, their agents, or estates, except to the extent set forth in the relevant purchase agreement(s) of the Successful Bidder. The sale will be free and clear of all Claims and Interests. The salient terms of the Bidding Procedures are: a. Bid Deadline: June 24, 2020, at 12:00 p.m. (ET) b. Initial Bid: TBD c. Deposit: 10% of the Purchase Price d. Auction: If the Debtors receive more than one Qualified Bids, the Debtors will conduct an auction of the Assets at the offices of Blank Rome LLP, located at 1201 N. Market Street, Suite 800, Wilmington, Delaware 19801, or such other location, including by virtual meeting, as will be timely communicated to all entities entitled to attend the Auction, at a time and date to be timely communicated to all entities entitled to attend the Auction, which Auction may be cancelled or adjourned. e. Bid Increments: $100,000 f. Sale Hearing: July 9, 2020 at 11:00 a.m. (ET) g. Sale Objection Deadline: 4:00 p.m. (ET) on June 29, 2020 A copy of the Bidding Procedures is available at https://tinyurl.com/y8atuzv2 from PacerMonitor.com free of charge. About Ravn Air Ravn Air Group, Inc. -- https://www.flyravn.com/ -- was formed through the combination of five Alaskan air transportation businesses in 2009, creating the largest regional air carrier and network in the state. Ravn owns and, until the COVID-19-related disruptions, operated 72 aircraft at 21 hub airports and 73 facilities, serving 115 destinations in Alaska with up to 400 daily flights. Until the COVID-19-related disruptions, Ravn Air Group and its affiliates had over 1,300 employees (non-union), and it carried over 740,000 passengers on an annual basis. Ravn Air Group provides air transportation and logistics services to the passenger, mail, charter, and freight markets in Alaska,pursuant to U.S. Department of Transportation approval as three separate certificated air carriers. Two of the carriers (RavnAir ALASKA and PenAir) operate under Federal Aviation Administration Part 121 certificates and the other (RavnAir CONNECT) operates under an FAA Part 135 certificate. In addition to carrying passengers, many of whom fly on Medicaid-subsidized tickets, other key customers include companies in the oil and gas industry, the seafood industry, the mining industry, and the travel and tourism industries. Ravn Air Group and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-10755) on April 5, 2020. At the time of the filing, Debtors was estimated to have assets of between and $100 million to $500 million and liabilities of the same range. Judge Brendan Linehan Shannon oversees the cases. The Debtors tapped Keller Benvenutti Kim LLP as bankruptcy counsel; Blank Rome LLP as special corporate and local bankruptcy counsel; Conway Mackenzie, LLC as financial advisor; and Stretto as claims and noticing agent. REALOGY GROUP: Moody's Rates Secured 2nd Lien Notes Due 2025 'B3' ----------------------------------------------------------------- Moody's Investors Service affirmed Realogy Group LLC's corporate family rating at B2, probability of default rating at B2-PD, senior secured first lien bank credit facility at Ba3 and senior unsecured notes at Caa1 and assigned a B3 rating to its proposed senior secured second lien notes due 2025. The Speculative Grade Liquidity rating remains SGL-3. The ratings outlook remains negative. The company plans to use the net proceeds of the proposed note to call a portion of its 5.25% notes due 2021. RATINGS RATIONALE "Realogy's plan to call a portion of its 5.25% notes due 2021 with the net proceeds of its proposed 2nd lien notes due 2025 greatly reduces its near-term refinancing risk, and is therefore a positive liquidity development," said Edmond DeForest, Moody's Vice President and Senior Credit Officer. DeForest continued: "That said, assuming the proposed second lien notes have a coupon well in excess of 5.25%, the transaction will weaken interest coverage and free cash flow, and so it is also a negative credit development." The B2 CFR reflects Moody's expectations for diminished revenue, profit margin declines and little to no free cash flow in 2020, but a substantial rebound in 2021 as coronavirus related impacts wane. Realogy's credit profile remains constrained by large anticipated declines in US existing home sale volumes. The economic fallout from the coronavirus pandemic will have a significant negative impact on Realogy's revenue, credit metrics, and liquidity. Moody's anticipates debt to EBITDA could peak well above 8 times in 2020, but return to below 7 times in 2021. Other credit metrics, including EBITA to interest and free cash flow to debt, will likely decline in 2020, but should improve if the existing home sale market recovers in 2021. All financial metrics cited reflect Moody's standard adjustments. Moody's considers the residential real estate brokerage market volatile, cyclical and seasonal. Although commission costs are variable, Realogy's owned brokerages have a high degree of fixed operating costs. A high proportion of its profits reflect home sale market activity as opposed to less-transactional franchise fees. Moody's anticipates Realogy will maintain its leading position in the residential real estate brokerage market throughout the downturn, as all competitors will be impacted, helping it drive rapid improvement in its financial results once existing home sale volume grows again. The impact of anticipated revenue declines and profit margin compression could be mitigated by Realogy's ongoing cost reduction programs and emphasis on new business initiatives. The rapid 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 expects that the residential real estate brokerage industry will be severely impacted by the shock. Realogy was already under competitive pressure over the last two years from other traditional brokers that have sought to recruit Realogy's best-performing sales people. Competition from non-traditional technology-enabled competitors including RedFin and Zillow, own-to-rent buyers and home flippers has grown. Additionally, Realogy's high operating and financial leverage could limit its flexibility if the negative impacts of the pandemic on the existing home sale market linger for an extended period. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The ratings reflect the impact on Realogy of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. As a public company, Realogy provides transparency into its governance and financial results and goals. The 10-person board of directors is controlled by independent directors. Moody's expects Realogy to maintain conservative financial strategies including building liquidity and eschewing large debt-funded M&A or any share repurchase activity until its financial leverage is reduced. Additionally, Realogy does not exhibit material environmental risks. The Ba3 rating on the senior secured obligations reflects their priority position in the capital structure and a Loss Given Default assessment of LGD2. The debt is secured by a pledge of substantially all of the company's domestic assets (other than excluded entities and excluding accounts receivable pledged for the securitization facility) and 65% of the stock of foreign subsidiaries. The Ba3 rating, two notches above the CFR, benefits from loss absorption provided by the junior ranking debt and non-debt obligations. The B3 rating assigned to the proposed senior secured second lien notes reflects its subordination to the existing 1st lien senior secured bank facilities, seniority to the senior unsecured notes, and a LGD assessment of LGD4. Moody's anticipates the second lien note will be secured by a second lien on substantially all of the company's domestic assets (other than excluded entities and excluding accounts receivable pledged for the securitization facility) and 65% of the stock of foreign subsidiaries. The Caa1 rating on the senior unsecured notes reflects the B2-PD PDR and an LGD assessment of LGD5. The LGD assessment reflects effective subordination to all the secured debt. The senior notes are guaranteed by substantially all of the domestic subsidiaries of the company (excluding the securitization subsidiaries). The SGL-3 liquidity rating reflects Realogy's adequate liquidity profile. As of March 31, 2020, Realogy had a cash balance of $628 million. Moody's anticipates free cash flow may be negative in 2020. Moody's expects proceeds from the second lien term loan will be used to repay a large portion of the 5.25% notes maturing in 2021, and expects that the $1.425 billion senior secured revolving credit facility due 2023 may be used to support the remaining outstanding balance at maturity, as well as for seasonal working capital needs. Over $600 million of revolver loans were available as of March 31, 2020. Realogy's cash flow is seasonal, with negative cash flow typically in the 1st fiscal quarter. Moody's expects some headroom under the maximum senior secured net debt to EBITDA (as defined in the facility agreement) financial maintenance covenant applicable to the secured debt over the next year. If financial results are worse than Moody's expects in 2020 or if financial results do not improve in 2021, the company may not comply with the financial covenant and could effectively lose access to some of its revolving credit facility. Realogy has only $44 million of required debt principal payments in 2020, but over $200 million due in 2021, pro forma for $400 million of early repayment of a portion of the outstanding 5.25% notes with the net proceeds from the proposed second lien notes. Realogy terminated its cash dividend to shareholders in 2019. The negative outlook reflects Moody's concerns that if the existing home sale market remains depressed in 2021 or competitive pressures increase, Realogy's credit metrics could remain weak and its liquidity could deteriorate. The outlook could be stabilized if Moody's anticipates: 1) improved US existing home sale market conditions, 2) debt to EBITDA will be maintained below 6.5 times and 3) free cash flow to debt of about 2%. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Given the negative ratings outlook, an upgrade is not anticipated in the near term. Over the longer term, the ratings could be upgraded if, through some combination of rising existing unit home sales and average prices or accelerated debt repayments, Moody's comes to expect: 1) debt to EBITDA will be sustained below 5.5 times and 2) free cash flow to debt will be sustained at or above 5%. Expectations for Realogy to maintain balanced financial strategies and good liquidity, including a longer debt maturity profile, are also important considerations for higher ratings. The ratings could be downgraded if Moody's anticipates: 1) existing home sale transaction volumes will remain depressed, 2) Realogy's brokerage brands and operations will lose their leading competitive positions, 3) debt to EBITDA will remain above 6.5 times or 4) weaker liquidity. An adoption of aggressive financial strategies, including large debt financed acquisitions or shareholder returns, would also weigh on the ratings. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Issuer: Realogy Group LLC Corporate Family Rating, Affirmed B2 Probability of Default Rating, Affirmed B2-PD Senior Secured 1st Lien Bank Credit Facility, Affirmed Ba3 (LGD2) Senior Secured 2nd Lien Regular Bond/Debenture, Assigned B3 (LGD4) Senior Unsecured Regular Bond/Debenture, Affirmed Caa1 (LGD5) Speculative Grade Liquidity Rating, Remains SGL-3 Outlook, Remains Negative Realogy is a global provider of real estate and relocation services. The company operates in four segments: franchise, brokerage, title and leads. The franchise brand portfolio includes Century 21, Coldwell Banker, Coldwell Banker Commercial, ERA, Sotheby's International Realty and Better Homes and Gardens Real Estate. Moody's expects 2020 revenues of over $4 billion. REGIONAL VALVE: Case Summary & 12 Unsecured Creditors ----------------------------------------------------- Debtor: Regional Valve Corp 2201 Albany Street Suite J Kenner, LA 70062 Business Description: Regional Valve Corp -- http://www.regionalvalvecorp.com-- provides industrial utility, petro chemical, marine, oil field, and commercial equipment. It also offers repair, testing, installation, and maintenance of safety relief valves for air, gas, steam and liquid services. Chapter 11 Petition Date: June 8, 2020 Court: United States Bankruptcy Court Eastern District of Louisiana Case No.: 20-11025 Judge: Hon. Meredith S. Grabill Debtor's Counsel: Phillip K. Wallace, Esq. PHILLIP K. WALLACE, PLC 4040 Florida Street, Suite 203 Mandeville, LA 70448-3305 Tel: 985-624-2824 E-mail: pkwallace@aol.com Total Assets: $941,080 Total Liabilities: $1,212,129 The petition was signed by Donald J. Roth, Jr., president/registered agent. A copy of the petition containing, among other items, a list of the Debtor's 12 unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/nWEwF3 REVLON INC: S&P Ugrades ICR to 'CCC-' on Refinancing Transaction ---------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Revlon Inc. to 'CCC-' from 'SD' after the company completed a refinancing transaction, which the rating agency viewed as distressed restructuring given the company's weak operating performance, negative cash flow generation, and significant near-term debt maturities. S&P assigned its 'CCC' issue-level rating with a '2' recovery rating to Revlon Inc.'s $880 million new money term loan (2020 BrandCo facility) due in June 2025. S&P also assigned its 'CC' issue-level ratings with a '5' recovery ratings to the company's $950 million roll-up term loan (roll-up BrandCo Facility) due in 2025 and to the $270.1 million remaining balances of the roll-up secured term loans (includes $3 million of a junior roll-up) that were extended to 2025. In addition, S&P is raising its issue-level ratings on the $516.9 million remaining balance of the nonextended portion of the company's $1.8 billion 2016 term loan to 'CC' from 'D' and revising the recovery rating on this tranche to '5' from '4'. This tranche comes due at its original maturity date of Sept. 2023. Lastly, S&P is affirming its 'C' issue-level ratings on the company's two tranches of senior unsecured notes due in Feb. 2021 and Aug. 2024 and revising the recovery ratings to a '6' from '5'. S&P continues to view Revlon's capital structure and its debt service burden as unsustainable, and its liquidity as weak. The transaction provided the company with additional liquidity and allowed it to extend maturity of a significant portion of its 2016 $1.8 billion term loan to June 2025. However, Revlon still faces significant debt maturities with its $450 million outstanding under the company's 5.75% unsecured notes coming due in February of 2021. In addition, the company's foreign asset-based lending (ABL) facility comes due in July 2021, and its $400 million domestic ABL revolving credit facility matures in September 2021. However, if the company does not redeem and/or refinance its 5.75% February 2021 notes, then maturities of its $400 million ABL revolver and the nonextended $516.9 million portion of 2016 term loan spring to November 2020 or 91 days prior to the maturity of the 5.75% notes. The company indicated that it could use a portion of its cash, which it received in connection to the recent transaction, to repurchase its 2021 notes at prevailing market prices. Currently, this debt is trading at distressed levels. S&P believes volatile market and business conditions created by the pandemic reduce the likelihood of the company addressing its debt maturities in a fashion that would provide lenders with the full promise of the original security. If a restructuring resulted in any of the lenders receiving less than the original promise of the security, S&P would view that as tantamount to a default. Pro forma for the recently closed 2016 term loan refinancing transaction the company has about $4 billion of funded debt on balance sheet as of March 28, 2020, up from about $3.3 billion before the transaction. Pro forma for the transaction, leverage is very high at nearly 20x at first quarter 2020, and S&P expects it to increase further in the upcoming quarters. S&P expects that a challenging operating environment and declining sales will make it very difficult for the company to improve profitability significantly despite its restructuring activities aimed to optimize cost structure and achieve meaningful cost savings. S&P expects Revlon's performance will continue to be hampered by the COVID-19 pandemic, leading to a sharp decline in revenue and EBITDA for fiscal 2020. The company's operations suffered during the first quarter of fiscal 2020 because of the challenging and competitive landscape in the industry and impact from COVID-19, which hurt Revlon's sales first in Asia, and subsequently in Europe and the U.S. As a result, revenue declined 18% during the quarter. S&P anticipates an even steeper drop in sales during the second fiscal quarter of 2020 because of massive store closures, a significant drop in discretionary spending as consumers remain focused on essential purchases, and travel bans that will hurt the company's sales in the travel retail channel. In addition, the company's product portfolio is heavily skewed toward color cosmetics and fragrances and S&P believes demand for these categories will remain weak given the recession and that more people are working from home and social distancing mandates create less social occasions. The negative outlook reflects S&P's view of the company's unsustainable capital structure and heavy debt service burden, and its belief that Revlon could pursue a distressed exchange or debt restructuring, or otherwise default on its debt obligations in the upcoming months. S&P could lower the rating if Revlon announced that it initiated a debt exchange or restructuring of its notes that results in lenders receiving less than the original promise of the security. S&P could also lower the ratings if it becomes apparent that the company has or will default of its debt obligations in a traditional manner. S&P could raise the rating if the company is able to address its near-term debt maturities and the rating agency believes a restructuring or a conventional default in the next six months is unlikely, even if the company's capital structure remains unsustainable. ROBERT KELLY MCLEAN: Selling Fairfield Property for $790K --------------------------------------------------------- Robert Kelly McLean and Sherry Annette McLean ask the U.S. Bankruptcy Court for the Eastern District of California to authorize the sale of the land commonly known as 324 Congressional Circle, Fairfield, California, APN 0151-731-230, for $790,000, pursuant to their Purchase and Sale Agreement, dated May 12, 2020. The Real Property is developed with a residential home on the property. The Debtors are aware of three liens secured by the property as well as property taxes. A true and correct copy of the Preliminary Title Report dated Jan. 10, 2020 is attached to the Exhibits filed in support of the motion. These are: a. The secured claim of PennyMac Loan Services, LLC is a first priority deed of trust secured by the Real Property in the approximate amount of $391,691. b. The secured claim of Umpqua Bank in the approximate amount of $175,447. c. The disputed secured claim of Thomas Swain in the amount of $214,038. The claim is disputed as a secured claim inasmuch as Mr. Swain is an insider and recorded an abstract of judgment on Sept. 26, 2019. Adversary Proceeding No. 20-02097-E seeks avoidance of that lien. In addition, the Debtors Claim of Exemption filed Feb. 23, 2020 made a claim of exemption in the amount of $175,000 pursuant to California Code of Civil Procedure section 704.730. The creditor meeting in the case was concluded on April 2, 2020. No timely objection to the claim of objection was filed. After payment of estimated costs of sale (8%) $63,200, the estimated claim secured by first priority deed of trust $391,691 and the estimated claim secured by second priority deed of trust $175,447 and the homestead exemption there are no funds available to pay the Swain claim. The Swain claim impairs Debtors homestead exemption. The Purchase Agreement as amended dated May 12, 2020 contemplates a closing date of June 18, 2020. Accordingly, the Debtors ask a waiver of Federal Rule of Bankruptcy Procedure 6004(h) to allow for an immediate closing of the sale upon court approval. The Debtors also ask that in the event of overbidding that any overbidder be required to provide $20,000 in certified funds (an amount equal to the deposit provided by the proposed purchaser) and that the minimum overbid be in the amount of $10,000 over the proposed purchase price. On May 8, 2020 the Order on Application to Employ Broker was entered on the docket. The Order contemplates payment of a sales commission of 5%. A hearing on the Motion is set for June 11, 2020 at 10:30 a.m. A copy of the Agreement is available at https://tinyurl.com/y8ef736b from PacerMonitor.com free of charge. Robert Kelly McLean and Sherry Annette McLean sought Chapter 11 protection (Bankr. E.D. Cal. Case No. 20-20972) on Feb. 23, 2020. The Debtors tapped Stephen M. Reynolds, Esq., as counsel. ROBETR S. HELLYER: Oak Groce Offers $15K for Hancock Property ------------------------------------------------------------- Robert Scott Hellyer asks the U.S. Bankruptcy Court for the Central District of Illinois to authorize the sale of 7.2 acres located in the East half of the Southeast Quarter of Section 36, Township 4 North, Range 6 West of the Fourth Principal Meridian, and the West half of the Southwest Quarter of Section 31, Township 4 North, Range 5 West of the Fourth Principal Meridian in Hancock County, Illinois, to Oak Grove, LLC for $15,000. On March 24, 2020, the Debtor entered into a real estate contract to sell the property. Pursuant to the Contract, the Debtor has received an offer from Oak Grove, 103 W, Railroad, PO. Box 68, Oakville, IA 52646, to purchase said property for the amount of $15,000. Said sale will not be free and clear of liens and encumbrances, which will be handled through the ordinary closing process. After payment of costs, including but not limited to the mortgage lien, other liens of record, real estate taxes, closing costs and real estate sales commissions, the Debtor does not expect to receive any proceeds from the sale because his payoff balance on the multiple cross-collateralized loans/mortgages is in excess of the sale price. The Debtor is of the opinion that such an offer is fair and reasonable, and it is in the best interests of the estate, and requests that the Court approves said sale. Robert Scott Hellyer sought Chapter 11 protection (Bankr. C.D. Ill. Case No. 19-80325) on March 19, 2019. The Debtor tapped B. Kip Shelby, Esq., as counsel. ROYAL CARIBBEAN: S&P Places 'BB' ICR on CreditWatch Negative ------------------------------------------------------------ S&P Global Ratings placed all of its ratings on Royal Caribbean Cruises Ltd. (Royal), including its 'BB' issuer credit rating, on CreditWatch with negative implications. At the same time, S&P is assigning its 'BB' issue-level rating and '3' recovery rating to the proposed guaranteed unsecured notes and are placing the issue-level rating on CreditWatch with negative implications. The proposed notes offerings will place added pressure on Royal's recovery next year and lead to potentially higher expected adjusted leverage in 2021. In addition, there remains a high degree of uncertainty around when and how the company will resume operation. Although the incremental debt will enhance Royal's liquidity, due to high borrowing costs, S&P believes the additional funded debt will further reduce operating cash flow, placing greater pressure on Royal's recovery path next year. S&P believes this will translate into 2021 adjusted leverage being at least 5.5x, its downgrade threshold at the 'BB' rating. S&P's forecast for 2021 assumes Royal's EBITDA remains below 2019 levels because it believes the pricing will remain pressured due to lingering consumer fears around travel and cruises stemming from the ongoing coronavirus pandemic. S&P also believes that cruise operators will slowly reintroduce their ships into service as they resume operation, which should somewhat limit capacity and better align supply and demand. The lower assumed pricing, in conjunction with the reduced available passenger capacity days, will translate into lower revenue. Furthermore, S&P believes cruise operators will implement social distancing and other health and safety measures on their ships to reduce the risk of spreading the virus. S&P believes these social distancing measures will reduce the load factors on their ships and potentially reduce the profitability and cash flow of the cruise operators. In addition, there remains a high degree of uncertainty as to when Royal will resume operation. The company suspended the operations of its entire fleet from March 13, 2020, through at least July 31, 2020, except for its China-based sailings, which it expects to remain suspended through at least June 30, 2020. S&P currently anticipates that the majority of cruises will remain suspended for most of the seasonally strong third quarter. However, the extension of travel restrictions, like Canada's recent extension of its ban on cruise ships through October, could limit the number of available ports and itineraries and lead some cruises to remain suspended into the fourth quarter. The proposed notes offerings will bolster Royal's liquidity. S&P believes the company's sources of liquidity will be sufficient to cover its uses over the next year. The proposed notes issuance does not impact S&P's current adequate liquidity assessment. Royal's sources of liquidity include the proposed $2 billion of new notes (although S&P does not include this as a committed source until closed), $3.9 billion of cash on hand as of March 31, 2020, about $970 million in net proceeds from the recent $3.3 billion senior secured note issuance (after repaying $2.3 billion in outstanding term loans), and committed financing for new ship deliveries. Its uses of liquidity include about $150 million-$170 million of monthly operating and corporate overhead expenses during a prolonged suspension of operations, refunds of customer deposits (which S&P estimates will be approximately $1 billion for the second through fourth quarters of this year), about $960 million in annual interest expense, about $500 million of capital expenditure between the second and fourth quarters of this year and about $2.1 billion for 2021, and $300 million of note maturities due in November 2020. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety The CreditWatch listing reflects the substantial uncertainty around when and how Royal will resume operation in 2020 and its ability to recover in 2021. In resolving the CreditWatch, S&P will assess Royal's plans for resuming sailings, including how it plans to address the ongoing travel restrictions that may limit its available ports and itineraries and the potential social distancing and other health and safety measures, which may limit its initial capacity. S&P also plans to update its base-case forecast for the company's revenue, EBITDA, cash flow, and leverage given the expected continued weak demand for cruises and travel due to lingering fears around the virus and the rating agency's expectation for reduced capacity as it resumes operation, at least initially. Furthermore, S&P plans to assess how the pandemic might alter the level of travel or cruise demand over the longer term and the prospects for a recovery later this year and in 2021. SCHAEFER AMBULANCE: Plan of Reorganization Confirmed by Judge ------------------------------------------------------------- Judge Neil W. Bason has entered findings of fact, conclusions of law and order confirming the Second Amended Plan Of Reorganization filed by Schaefer Ambulance Service, Inc. The Plan satisfies Section 1123(a)(5) of the Bankruptcy Code. Article IV of the Plan provides adequate and proper means for implementation of the Plan, including, but not limited to, the assignment of all of the Debtor's assets to the SAS Creditor Trust under the Plan and the SAS Creditor Trust Agreement and the funding of the distributions. The Plan was developed through negotiations in good faith and at arms'-length with Cathay, the J. Walter Schaefer Testamentary Trust and other interested parties, and was proposed with the legitimate and honest purpose of maximizing the value of the Debtor's estate for the benefit of creditors, providing the maximum possible distributions to creditors and equity, and resolving multiple disputes without the need for further litigation. A copy of the Plan Confirmation Order dated May 15, 2020, is available at https://tinyurl.com/y7srgclh from PacerMonitor at no charge. Attorneys for the Debtor: Craig G. Margulies Monsi Morales MARGULIES FAITH LLP 16030 Ventura Boulevard, Suite 470 Encino, CA 91436 Telephone: (818) 705-2777 Facsimile: (818) 705-3777 E-mail: Craig@MarguliesFaithLaw.com Monsi@MarguliesFaithLaw.com About Schaefer Ambulance Service Schaefer Ambulance Services, Inc. -- http://www.schaeferamb.com/-- is an emergency medical services provider specializing in basic life support; paramedic; critical care; neonatal; event standbys; and other specialized medical services. The Company offers ground transport for hospitals, urgent care centers, convalescent homes, physicians, insurance companies, fire departments and private/public events. Schaefer Ambulance was founded by Walter Schaefer in 1932. Schaefer Ambulance Services filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 19-11809) on Feb. 20, 2019. In the petition signed by Leslie Maureen McNeal, treasurer, the Debtor is estimated to have $1 million to $10 million in assets and $1 million to $10 million in liabilities. The case is assigned to Judge Neil W. Bason. Craig G. Margulies, Esq., at Margulies Faith LLP, is the Debtor's counsel. BidMed, LLC, is the asset liquidation broker. SENIOR PRO: Hires Robert E. Nuddleman as Special Counsel -------------------------------------------------------- Senior Pro Services, LLC received approval from the U.S. Bankruptcy Court for the Northern District of California to employ Nuddleman Law Firm, P.C. as its special counsel. Nuddleman Law Firm will advise Debtor on issues related to work rules and unemployment, and employee disputes. The hourly rates for the firm's professionals are as follows: Robert E. Nuddleman $400 Paralegal Services $195 Law Clerk/Research $95 Robert Nuddleman, Esq., at Nuddleman Law Firm, 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: Robert E. Nuddleman, Esq. Nuddleman Law Firm, P.C. 5820 Stoneridge Mall Road, Suite 207 Pleasanton, CA 94588 Telephone: (925) 400-9052 Facsimile: (925) 460-9987 Email: robert@nuddleman.com About Senior Pro Services Senior Pro Services, LLC, a home health care service provider in San Leandro, Calif., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 20-40408) on Feb. 22, 2020. In the petition signed by Fessha Taye, Debtor's manager and chief executive officer, Debtor estimated $1 million to $10 million in assets and $100,000 to $500,000 in liabilities. Judge Charles Novack oversees the case. James A. Shepherd, Esq., at the Law Offices of James Shepherd, is Debtor's legal counsel. SHEPPARD AND SON: Massey Buying Cordele Property for $7.5K ---------------------------------------------------------- Sheppard and Son Properties, LLC, asks the U.S. Bankruptcy Court for the Middle District of Georgia to authorize the sale of the real property on Schedule A/B commonly known as 1205 Drayton Road, Cordele, Georgia to Raymond Massey for $7,500. A hearing on the Motion is set for June 23, 2020 at 10:00 a.m. The Debtor listed the property. It valued the real estate at $5,000. The real estate is a vacant lot on which sits a burned-out house. No secured creditor is listed with a lien on the property. The Debtor proposes to sell the property, as more fully shown by the legal description and plat in Exhibit A, in a cash sale in the total amount of $7,500 for the whole of the property to the third-party Purchaser. The Buyer has no interest in the Debtor and is a neighboring landowner who desires further access rights through the lot to his own property. The Debtor will transfer a Warranty Deed to the Buyer. The Buyer will be responsible for future real estate taxes and insurance. The Department of Justice may claim a lien on the property from that certain restitution judgment entered against Greene W. Sheppard individually and filed of record in GED Book 25, Page 70 on Aug. 7, 2013 in the Superior Court of Crisp County. The previous titled owner of the property however was G. Wylie Sheppard, Jr. according to the deed records. By information and belief, Greene W. Sheppard is current on payment obligations to the Department of Justice pursuant to a consent agreement. Furthermore, the Department of Justice obtained the benefit of receipt of the excess tax sale proceeds from this property. The Department of Justice has agreed to release any lien or encumbrance that it may have against this property for a stated release price of $2,000, which will be paid from the proceeds at closing. The remainder of funds received, after subtracting closing costs and other charges directly related to the sale and the payments to the claimant listed, will be used to provide additional funding for the Chapter 11 plan. Through the deal, Debtor will realize full value for its property interest at a value greater than that provided in the schedules and eliminate the need to pay future taxes and insurance. The property has no current income stream and no reasonable prospect of generating income without the addition of further capital which the Debtor is not in a position to supply. The completion of this sale is in the best interest of the Debtor and the creditors. No real estate broker has been retained for the transaction. The Debtor asks that the Court approves the transaction and authorize Debtor to execute any instruments necessary to effectuate the sale in accordance with FRBP 6004(f)(2). It asks a waiver of the 14-day stay set forth in FRBP 6004(h). A copy of the Exhibit A is available at https://tinyurl.com/y8564tcx from PacerMonitor.com free of charge. About Sheppard and Son Properties Sheppard and Son Properties, LLC, a nonresidential building operator in Cordele, Georgia, filed a Chapter 11 petition (Bankr. M.D. Ga. Case No. 18-11388) on Nov. 6, 2018. In the petition signed by Greene Wylie Sheppard, Jr., sole member, the Debtor disclosed $1,202,487 in total assets and $224,757 in total liabilities. The case is assigned to Judge Austin E. Carter. The Debtor is represented by Emmett L. Goodman, Jr., LLC. SIRIUS XM: Moody's Rates New $1BB Unsecured Notes Due 2030 'Ba3' ---------------------------------------------------------------- Moody's Investors Service assigned a Ba3 rating to Sirius XM Radio Inc.'s proposed $1 billion senior unsecured notes offering. The stable outlook remains unchanged. Assignment: Issuer: Sirius XM Radio Inc. $1.0 Billion Gtd Senior Unsecured Global Notes due 2030, Assigned Ba3 (LGD4) The assigned rating is subject to review of final documentation and no material change in the size, terms and conditions of the transaction as advised to Moody's. RATINGS RATIONALE The transaction is leverage neutral since Moody's expects Sirius XM to use the net offering proceeds plus cash to repay the $1 billion 5.375% senior notes due April 15, 2025, which are callable at 102.688 plus accrued and unpaid interest. Moody's views the transaction favorably given the extension of the debt maturity and expected lower annual interest expense. Sirius XM's Ba3 Corporate Family Rating reflects its low leverage profile for the rating category at 3.6x total debt to EBITDA (Moody's adjusted at March 31, 2020), high EBITDA margins in the 27%-32% area (Moody's adjusted) and 60% free cash flow conversion. The rating is further supported by Sirius XM's sizable self-pay satellite radio subscriber base, unique mix of content and curated channels, stable to rising share in new vehicles and increasing penetration in the used car segment. While Moody's expects US new automobile unit sales to decline 25% this year (rebounding to 16.2% in 2021), used vehicle sales have rebounded sooner and at a sharper pace following the March nadir as the US economy began to reopen in May. Weekly sales are now back to pre-COVID-19 levels kindled by the federal government's stimulus checks and consumers shift to less expensive used vehicles due to the weak economic environment. With nearly 50% penetration in the used car market, sales of used vehicles represent a significant source of subscribers for Sirius XM. Moody's believes the company's exposure to the used vehicle market will help offset and cushion the revenue impact from reduced new car sales. Sirius XM derived revenue diversification and scale benefits from the Pandora Media, LLC acquisition, which helped to extend its presence to in-home and mobile entertainment markets in North America, and enabled the creation of new curated content. As the leading ad-supported digital audio platform in the US, Pandora gives Sirius XM more ways to monetize the trial user funnel. The rating is constrained by heightened governance risk from the company's majority ownership by Liberty Media Corporation. Liberty's control poses event risk given its track record for M&A and shareholder-friendly transactions. Sirius XM also faces certain risks brought about by social trends, including the move to digital music streaming services and changing demographics. Further weighing on the rating is Sirius XM's historically aggressive financial policy, which includes funding sizable share repurchases with debt and the entirety of free cash flow. Given the current economic recession, Moody's expects share repurchases will remain modest this year, with buybacks and dividends funded from operating cash flow. Despite high gross debt totaling $7.8 billion, financial leverage ratios along with other credit metrics have remained strong due to historically robust EBITDA growth. Other challenges include a high monthly churn rate and slowing subscriber and revenue growth in Sirius XM's core vehicle market at a time when the auto industry and overall economy are facing contraction. Moody's expects the economic impact arising from the novel coronavirus pandemic and related economic recession on its profitability will be manageable given the company's subscription-based revenue model, which accounts for nearly 80% of revenue. Subscription revenue growth will experience pressure this year as renewal rates soften due to the decline in new and used car sales. However, Moody's expects the business model to exhibit resilience from several mitigating factors, including Sirius XM's exposure to the used car segment (which has recovered faster than new car sales), large installed subscriber base and differentiated content that attracts more upscale and professional customers with high income levels compared to terrestrial radio. As such, dislocations in the broader economy should be less impactful to the company's subscribers. Moody's also expects subscription pricing and ARPU to remain stable. The company maintains a highly variable cost structure, which benefits from natural expense reductions as revenue moderates. This includes reductions in: revenue share and royalty expenses, subscriber acquisition costs, sales and marketing expenses, SG&A costs, engineering costs and customer service and billing costs, which will enable Sirius XM to sustain healthy margins. Moody's expects Sirius XM to maintain very good liquidity provided by its undrawn $1.75 billion unrated senior secured revolver due 2023 and projected FCF generation in the range of $1.3 billion to $1.6 billion in 2020 buttressed by the revenue visibility from its subscription-based model. Cash balances totaled $224.6 million at 5 June 2020. The stable outlook reflects Moody's view that Sirius XM's subscriber-based business model and operating profitability will remain fairly resilient during the ensuing economic recession similar to the resilience demonstrated during the 2008-09 global financial crisis and will generate robust free cash flow. Moody's expects that Sirius XM will maintain very good liquidity, even during periods of economic weakness and increased satellite construction spend. Potentially higher leverage rising to management's 4x as-reported target (roughly equivalent to 4x Moody's adjusted) due to moderating EBITDA this year is also factored in the stable outlook. Moody's projects a decline in economic activity in the wake of the coronavirus outbreak, with US GDP growth contracting 5.7% in 2020, followed by a 4.5% rebound next year. ESG CONSIDERATIONS The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. The satellite radio sector has been one of the sectors affected by the shock given its sensitivity to consumer demand and sentiment. More specifically, the weaknesses in Sirius XM's credit profile, including its exposure to the US economy, have left it vulnerable to shifts in market sentiment in these unprecedented operating conditions and Sirius XM remains somewhat vulnerable to the outbreak's continuing spread. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade is unlikely over the near-term, however over time an upgrade could occur if management demonstrates a commitment to balance debt holder returns with those of its shareholders, which would include sizing share repurchases within annual free cash flow generation and limiting debt-funded buybacks. Moody's would also need assurances that Sirius XM will operate in a financially prudent manner consistent with a higher rating. Upward ratings pressure could also transpire if the company demonstrated a track record for sustaining total debt to EBITDA below 3.5x (including Moody's standard adjustments) and free cash flow to debt above 12% (Moody's adjusted) even during periods of satellite construction. The ratings could be downgraded if: (i) Moody's expects total debt to EBITDA will be sustained above 4.5x (including Moody's standard adjustments); (ii) free cash flow generation falls below targeted levels as a result of subscriber losses due to the weak economy, customer migration to competing media services or functional problems with satellite operations; or (iii) Sirius XM experienced weakened liquidity below expected levels as a result of increased share repurchases, dividends, capital spending or acquisitions. Headquartered in New York, NY, Sirius XM Radio Inc., is a wholly-owned operating subsidiary of Sirius XM Holdings Inc., which provides satellite radio services in the United States and Canada through a fleet of five owned satellites. Sirius XM reported 34.8 million subscribers at the end of March 2020. The company holds a 70% equity interest and 33% voting interest in Sirius XM Canada and owns 100% of Pandora Media, LLC (acquired on February 1, 2019), which has 60.9 million active users and 6.3 million subscribers. Sirius XM is publicly traded and a controlled company of Liberty Media Corporation, which owns approximately 72% of its common shares. Revenue totaled approximately $8 billion for the twelve months ended March 31, 2020. The principal methodology used in these ratings was Media Industry published in June 2017. SM-T.E.H. REALTY 4: Sale of All Assets to Forkzilla Approved ------------------------------------------------------------ Judge Kathy A. Surratt-States of the U.S. Bankruptcy Court for the Eastern District of Missouri authorized SM-T.E.H. Realty 4, LLC's sale of substantially all assets to Forkzilla, LLC. A hearing on the Motion was held on June 2, 2020. Upon the Closing and payment of the Purchase Price under the Agreement, the Purchaser will take title to and possession of the Assets. The sale is free and clear of all Encumbrances. The interests of the Encumbrances will attach to the proceeds of the sale of the Assets. Notwithstanding the foregoing, at the time of Closing (a) Fannie Mae, the Debtor's principal secured creditor will receive payment in full of all sums due and owing to it from the Debtor, and in exchange for such payment, Fannie Mae will provide such releases of its liens, security interests, and other rights and interest in the Assets as may be deemed necessary by any agent or other person conducting the Closing, (b) payment will be made to CBRE, Inc. in the amount of $125,000 with respect to its commission as the Debtor's broker, (c) payment will be made in the amount of $206,925 to the St. Louis Metropolitan Sewer District, (d) funds will be held in escrow with St. Louis Title, LLC in the amount of $6,500 pending resolution by the Court of the mechanic's lien claim of Spectrum Cleaning Services, Inc., (e) funds will be held in escrow with St. Louis Title, LLC in the sum of $185,362 pending resolution by the Court of the claim of and assertion of an equitable lien against the Property by Nitya SO, LLC, which escrowed sum represents 150% of the amount Nitya SO, LLC claims it is owed by the Debtor, (f) the Purchaser will receive a credit in the amount of $63,551 which sum represents tenant security deposits received by the Seller, (g) the sum of $5,943 will be paid to the Debtor for the sole and exclusive purpose of refunding security deposits to tenants who previously moved from the subject property, and (h) funds will be specifically reserved for payment of quarterly fees to the Office of the United States Trustee. Notwithstanding anything in the Order to the contrary, all proceeds of sale, less the sums specifically described in the foregoing will be held by St. Louis Title, LLC in escrow for a period of 14 days following entry of the Order. Upon the expiration of 14 days following entry of the Order, and in the absence of an appeal from or other relief sought with respect to the Order, St. Louis Title, LLC will immediately remit the Excess Proceeds to the Debtor without the need for additional notice, order of the Court, or consent of any creditor or party in interest. Pursuant to sections 105(a), 363(b), 363(f), and 365 of the Bankruptcy Code, the Debtor is authorized to transfer to the Purchaser the Assumed Leases and Assumed Contracts. Pursuant to Bankruptcy Rules 7062, 9014, 6004(h) and 6006(d), the Order will be effective immediately upon entry and the Debtor is authorized to close the sale immediately upon entry of the Order, the stay otherwise applicable under Rule 6004(h) is waived and inapplicable to the relief requested in the Order. Upon receipt of the Excess Proceeds as contemplated, the Debtor will deposit proceeds of sale it receives at Closing in a depository institution approved by the Office of the United States Trustee, and the Debtor will disburse such Excess Proceeds only upon entry of an Order of the Court authorizing such disbursement. The Order is a final and appealable order as of June 3, 2020 and there is no just cause for delay of enforcement. No later than two business days after the date of the Order, the Debtor will serve a copy of the Order on the 20 largest unsecured creditors, all parties requesting notice and the United States Trustee and will file a certificate of service no later than 24 hours after service. About SM-T.E.H. Realty 4 SM-T.E.H. Realty 4, LLC, is a single asset real estate (as defined in 11 U.S.C. Section 101(51B)), whose principal assets are located at 4015 Brittany Circle Bridgeton, Mo. SM-T.E.H. Realty 4 sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mo. Case No. 20-42148) on April 21, 2020. The petition was signed by Michael Fein, Debtor's manager. At the time of the filing, Debtor disclosed estimated assets of $10 million to $50 million and estimated liabilities of the same range. Judge Kathy A. Surratt-States oversees the case. The Debtor tapped Steven M. Wallace, Esq., at Silver Lake Group, Ltd. as its counsel. STABLELIFT OF TEXAS: Seeks to Hire Frank B. Lyon as Counsel ----------------------------------------------------------- StableLift of Texas, Inc. seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to employ the Law Offices of Frank B. Lyon as its legal counsel. The firm will provide the following services: (a) advise Debtor of its powers and duties in the continued operation of its business and management of its property; (b) advise the Debtor of its responsibilities under the Bankruptcy Code; (c) assist Debtor in preparing and filing the required schedules, statement of affairs, monthly financial reports, the initial debtor report and other documents; (d) represent Debtor in adversary proceedings and other contested and uncontested matters; (e) represent Debtor in the negotiation and documentation of any sales or refinancing of property of the estate, and in obtaining the necessary approvals of such sales or refinancing by the court; and (f) assist Debtor in the formulation of a plan of reorganization and disclosure statement and in taking the necessary steps to obtain court approval of such documents. The professionals designated to render services will be paid at hourly rates as follows: Frank Lyon, Esq. $425 Legal Assistants $150 The firm received the sum of $14,967 from Debtor as retainer. Frank Lyon, Esq., disclosed in court filings that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The attorney can be reached at: Frank B. Lyon, Esq. Law Offices of Frank B. Lyon 3508 Far West Boulevard, Suite 170 Austin, TX 78731 Telephone: (512) 345-8964 Facsimile: (512) 697-0047 Email: frank@franklyon.com About StableLift of Texas Stablelift of Texas Inc., a New Braunfels, Texas-based company that provides concrete slab home foundation repair, stabilization and elevation recovery services, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No. 20-10509) on April 20, 2020. The petition was signed by Brent Goodman, Debtor's manager. At the time of the filing, Debtor disclosed total assets of $627,819 and total liabilities of $2,289,313. Judge Tony M. Davis oversees the case. Debtor is represented by the Law Offices of Frank B. Lyon. SUNTECH DRIVE: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Debtor: SunTech Drive, LLC 2011 Cherry Street, #104 Louisville, CO 80027 Business Description: SunTech Drive, LLC -- http://suntechdrive.com-- is a privately held solar power electronics company. SunTech Drive provides source-agnostic, intelligent power conversion equipment. Its patent pending designs represent a dramatic departure from the large and costly legacy controllers of the past. SunTech has replaced traditional electromagnetic cores and windings with high-speed digital switching silicon and adaptive firmware. Chapter 11 Petition Date: June 8, 2020 Court: United States Bankruptcy Court District of Colorado Case No.: 20-13934 Judge: Hon. Joseph G. Rosania Jr. Debtor's Counsel: Jeffrey S. Brinen, Esq. KUTNER BRINEN, P.C. 1660 Lincoln Street, Suite 1850 Denver, CO 80264 Tel: 303-832-2400 E-mail: jsb@kutnerlaw.com Total Assets: $199,483 Total Liabilities: $6,675,846 The petition was signed by Harold K. Michael, CEO. A copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://is.gd/EAjS67 SURGERY CENTER: Moody's Confirms Caa1 CFR, Outlook Stable --------------------------------------------------------- Moody's Investors Service confirms the ratings of Surgery Center Holdings, Inc. ("doing business as Surgery Partners") including the Corporate Family Rating of Caa1, the Probability of Default Rating of Caa1-PD, and the first lien senior secured debt rating of B2. The unsecured notes, rated Caa2, were also confirmed. Additionally, Moody's changed the Speculative Grade Liquidity Rating to SGL-2 (good). At the same time, Moody's changed the outlook to stable from under review. This concludes the rating review that was initiated on March 24, 2020. The confirmation of the Caa1 CFR reflects Moody's expectation that the company's leverage -- which was already high before the pandemic -- will remain elevated given reduced elective procedures due to the coronavirus. However, Surgery Partners' liquidity has improved and elective procedure volumes have been ramping up in recent weeks. Despite its high cash interest expense relative to its earnings, the improved liquidity and volume outlook reduces the risk that there is an event of default, including a liquidity shortfall or distressed exchange. The stabilization of the outlook reflects Moody's view that Surgery Partners has sufficient liquidity to manage through the public health emergency. The stable outlook also reflects Moody's favorable view of the longer-term prospects for ambulatory surgery centers. The upgrade of the Speculative Grade Liquidity Rating to SGL-2 from SGL-3 reflects Moody's expectation of good liquidity over the next 12-18 months. At March 31, 2020, the company had approximately $195 million of cash. The company had nearly fully drawn the $120 million senior secured revolving credit facility. Subsequent to March 31, the company issued a $120 million term loan add-on and received $45 million in grants from the CARES Act and another $120 million of accelerated payments from the Medicare Advance Payment Program, further supporting liquidity. Moody's expects that Surgery Partners will be able to conserve cash through significant reduction in capex as well as slowing of physician distributions and managing working capital. However, Moody's still expects that there will be approximately $100 million of cash burn in 2020 due to volume loss from delayed elective surgeries. The company's springing covenant on the revolver will not be tested in 2020, due to a recently negotiated covenant holiday. Issuer: Surgery Center Holdings, Inc. Probability of Default Rating confirmed at Caa1-PD Corporate Family Rating confirmed at Caa1 Senior Secured First Lien Revolving Credit Facility confirmed at B2 (LGD2) Senior Secured First Lien Term Loans confirmed at B2 (LGD2) Senior Unsecured GTD Global Notes due 2025 confirmed at Caa2 (LGD5) Senior Unsecured GTD Global Notes due 2027 confirmed at Caa2 (LGD5) Speculative Grade Liquidity Rating upgraded to SGL-2 from SGL-3 Outlook Actions: Issuer: Surgery Center Holdings, Inc. Outlook, Changed To Stable from Rating Under Review RATINGS RATIONALE Surgery Partners' Caa1 Corporate Family Rating reflects its high financial leverage, weak interest coverage and history of negative free cash flow. The credit profile is also constrained by the elective nature of many of the procedures performed in its ambulatory surgery centers, meaning that patients can delay/forego treatment during the coronavirus global pandemic or in times of economic weakness. Further, the ratings are constrained by risk stemming from exposure to government payers (mostly Medicare), which could lead to future reimbursement pressures on ASCs. The ratings are supported by Moody's expectation of favorable industry fundamentals. This is because over the longer term, payers including Medicare and private insurers, will continue to drive patients out of hospitals and into less costly points of care, such as ASCs. The rating also benefits from the company's strong market position and good case mix that favors procedures with higher reimbursements. Moody's considers coronavirus to be a social risk given the risk to human health and safety. Aside from coronavirus, Surgery Partners faces other social risks as well such as the rising concerns around the access and affordability of healthcare services. However, Moody's does not consider the ASCs to face the same level of social risk as hospitals as ASCs are viewed as an affordable alternative to hospitals for elective procedures. From a governance perspective, Surgery Partner's facilities are partly owned by the physicians -- which helps to align economic incentives with physicians to perform procedures in the ASCs. That said, Surgery Partner's financial policies are aggressive given its history of acquisitions and high leverage. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to an upgrade include reduction of debt/EBITDA towards 7x and an improvement in free cash flow. Factors that could lead to a downgrade include a material, sustained increase in leverage from current levels, increased probability of an event that Moody's would consider to be a default, including a distressed exchange, or if liquidity weakens. Surgery Partners, headquartered in Nashville, TN, is an operator of 127 short stay surgical facilities in 30 states. The surgical facilities, which include 111 ASCs and 16 surgical hospitals, primarily provide nonemergency surgical procedures across many specialties. Surgery Partners also provides ancillary services including physician practice services, anesthesia services, a diagnostic laboratory, a specialty pharmacy and optical services. Surgery Partners is 66% owned by Bain Capital Private Equity and listed on the NASDAQ. Revenue is approximately $1.9 billion LTM March 30, 2020. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. SYNCREON INTERMEDIATE: S&P Affirms 'CCC+' ICR; Outlook Stable ------------------------------------------------------------- S&P Global Ratings affirmed its 'CCC+' issuer credit rating on U.S.-Based syncreon Intermediate B.V. and its respective 'B-' and 'CCC-' issue ratings on the first- and second-out senior secured term loans. syncreon has seen lower activity during the peak months of April and May due to COVID-19-related disruption. During the peak of the COVID-19 pandemic, the company closed 17 sites--mostly related to its automotive business--before reopening 11 of these sites to date on a gradual basis. A further 39 sites are operating at lower volumes given the COVID-19 pandemic's disruption to many of its customers' operations. The governments in syncreon's regions of operation have considered the company an essential service and the company has continued operations, primarily on its technology business, which is experiencing an increase in demand. S&P notes that management acted quickly to reduce costs, where possible, in order to minimize the effect on the company's EBITDA. S&P anticipates a 16% fall in revenue for 2020, with reported EBITDA dropping by about 10% as a result. In addition, any lost contracts or delays in the ramping up of new contracts that the company expected to commence in 2020 could put further strain on the company." Management has adopted a number of liquidity measures and S&P continues to assess the company's liquidity as adequate. These measures include availing of government initiatives, rent negotiations, continued working capital management, reduced selling, general, and administrative (SG&A) costs, and drawing on the company's ABL facility to bolster its cash position. The company has $142 million of liquidity as of end-March 2020. In addition, syncreon has received approval from lenders for a covenant holiday until Q2 2021, while also electing to make payments in kind on the interest on its second-out facility as of Q1 2020 to ensure no further pressure on liquidity. The company will make the first-out interest repayments quarterly instead of monthly, while both interest options remain in line with the terms of the existing credit agreement. The stable outlook reflects S&P's expectation that syncreon has adequate liquidity to meet its short-term cash needs over the next 12 months. However, S&P considers the company's capital structure to be unsustainable over the longer term. This is because the company depends on favorable business and economic conditions to be able to generate positive free operating cash flow (FOCF) and support its debt burden, despite the recent significant reduction. S&P could take a negative rating action if the company's operating performance weakens further, resulting in EBITDA margin declines and sustained negative FOCF, in turn leading to insufficient liquidity and an increased likelihood of a default or a distressed exchange. Any operational issues arising from the reopening of the 17 sites, as well as lower-than-expected volumes and increased execution risk as the company restarts production for many of its automotive customers, could put greater pressure on liquidity than S&P currently anticipates. In addition, pressure could build on liquidity as governments reduce temporary support measures in syncreon's countries of operation. An upgrade is unlikely over the next 12 months. S&P could take a positive rating action if the company substantially improves its cash generation and exhibits sustainable, meaningfully positive FOCF. This could happen, for example, if syncreon increases its EBITDA margin without an offsetting increase in outlays for capital expenditure (capex) and working capital. TANGO DELTA: Seeks Approval to Hire Cole & Cole as Counsel ---------------------------------------------------------- Tango Delta Financial, Inc. seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to employ Cole & Cole Law, P.A. as its legal counsel. The firm's services will include: (a) advising Debtor of its duties and powers in its Chapter 11 case; (b) assisting in the investigation of the conduct, assets, liabilities and financial condition of Debtor and the operation of its business, and any other matters relevant to the case and to the formulation of a bankruptcy plan; (c) participating in the formulation of a plan; and (d) assisting Debtor in requesting the appointment of a trustee or examiner should such action become necessary. The firm's professionals will be paid at hourly rates as follows: R. John Cole, II, Esq. $450 Richard John Cole, III, Esq. $375 Paralegals $120 The firm received a $18,283 retainer, plus the filing fee of $1,717. Cole & Cole Law does not represent any interest adverse to the interest of Debtor, according to court filings. The firm can be reached through: R. John Cole, II, Esq. Cole & Cole Law, P.A. 46 N. Washington Blvd., Suite 24 Sarasota, FL 34236 Telephone: (941) 365-4055 Facsimile: (941) 365-4219 Email: rjc@colecolelaw.com About Tango Delta Financial Tango Delta Financial Inc., formely doing business as American Student Financial Group Inc. (ASFG), is a Sarasota, Fla.-based company that buys student loans for investment purposes. On May 11, 2020, Tango Delta sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-03672). The petition was signed by Tango Delta President Timothy R. Duoos. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Debtor is represented by Cole & Cole Law, P.A. TEMPLAR ENERGY: June 10 Deadline Set for Committee Applications --------------------------------------------------------------- The U.S. Trustee is soliciting members for an unsecured creditors committee in the bankruptcy cases of Templar Energy LLC, et al. If one wishes to be considered for membership on any official committee that is appointed, one must complete a required Questionnaire Form and return it to the Office of the United States Trustee no later than 4:00 p.m. (Central Standard Time), on Wednesday, June 10, 2020 by email to jane.m.leamy@usdoj.gov. A representative from the U.S. Trustee's Office will contact all creditors submitting a questionnaire to arrange for a telephonic interview. Questions should be sent to o Jane M. Leamy using the email addresses above using the email addresses above. About Templar Energy Templar Energy LLC and its affiliates, founded in 2012, are independent exploration and production companies, with a core focus on the development and acquisition of oil and natural gas reserves in the Greater Anadarko Basin of Western Oklahoma and the Texas Panhandle. Templar Energy and its operating subsidiaries -- http://templar.energy/-- have acquired substantial assets in the Mid-Continent region covering, as of the Petition Date, approximately 273,400 net acres by directly leasing oil and gas interests from mineral owners. Templar Energy LLC and its affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 20-11441) on June 1, 2020. Templar Energy was estimated to have $100 million to $500 million in assets and $500 million to $1 billion in liabilities. Guggenheim Securities, LLC is acting as the Company's investment banker, Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal counsel, and Alvarez & Marsal North America, LLC is acting as financial advisor. Young Conaway Stargatt & Taylor, LLP is local co-counsel. Kurtzman Carson Consultants LLC is claims agent, maintaining the page http://www.kccllc.net/TemplarEnergy THEE TREE HOUSE: Has Until June 10 to File Plan & Disclosures ------------------------------------------------------------- Judge Caryl E. Delano of the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, has entered an order within which the time of debtor Thee Tree House, LLC to file Plan and Disclosure Statement is extended to June 10, 2020. A copy of the order dated May 15, 2020, is available at https://tinyurl.com/yd3qtsbz from PacerMonitor at no charge. About Thee Tree House Thee Tree House, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-11768) on Dec. 13, 2019. 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. Judge Caryl E. Delano oversees the case. The Debtor is represented by McIntyre Thanasides Bringgold Elliott Grimaldi Guito & Matthews, P.A. TIDEWATER ESTATES: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Tidewater Estates, Inc. 1213 Tidewater Dr. Pass Christian, MS 39571 Chapter 11 Petition Date: June 9, 2020 Court: United States Bankruptcy Court Southern District of Mississippi Case No.: 20-50955 Judge: Hon. Katharine M. Samson Debtor's Counsel: Patrick Sheehan, Esq. SHEEHAN AND RAMSEY, PLLC 429 Porter Ave Ocean Springs, MS 39564 Tel: 228-875-0572 E-mail: Pat@sheehanlawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Emile A. Bertucci, III, director, secretary/treasurer. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/su0Vx1 TNTMD PA: June 24 Plan & Disclosure Hearing Set ----------------------------------------------- On May 12, 2020, TNTMD, PA, filed with the U.S. Bankruptcy Court for the Middle District of Florida, Jacksonville Division, a Disclosure Statement with respect to Chapter 11 Plan. On May 15, 2020, Judge Cynthia C. Jackson conditionally approved the Disclosure Statement and ordered that: * Creditors and other parties in interest shall file with the court their written ballots accepting or rejecting the Plan no later than 14 days before the date of the confirmation hearing. * June 24, 2020, at 11:00 a.m. in 4th Floor Courtroom C, 300 North Hogan Street, Jacksonville, Florida is fixed for the hearing on final approval of the Disclosure Statement and for the hearing on confirmation of the Plan. * Any objections to approval of the Disclosure Statement or confirmation of the Plan must be filed and served seven days before the date of the disclosure and plan confirmation hearing. A copy of the order dated May 15, 2020, is available at https://tinyurl.com/yb3g6uwu from PacerMonitor at no charge. 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. UNIVISION COMMUNICATIONS: S&P Rates New Senior Secured Notes 'B' ---------------------------------------------------------------- S&P Global Ratings assigned its 'B' issue-level rating and '3' recovery rating to Univision Communications Inc.'s proposed senior secured notes due 2027. The '3' recovery rating indicates S&P's expectation for meaningful (50%-70%; rounded estimate: 60%) recovery for lenders in the event of a payment default. The company plans to use the proceeds from these notes to repay its existing 5.125% senior notes due 2023 ($1.2 billion currently outstanding). S&P's 'B' issuer credit rating and stable outlook on Univision remain unchanged because the proposed transaction will not affect its net leverage. UTZ QUALITY: Moody's Hikes CFR to B1 & Alters Outlook to Positive ----------------------------------------------------------------- Moody's Investors Service upgraded the Corporate Family Rating and Probability of Default Ratings of Utz Quality Foods, LLC to B1 and B1-PD from B2 and B2-PD, respectively. Moody's also assigned a Speculative Grade Liquidity rating of SGL-2. The rating on Utz's first lien term loan was affirmed at B2. The actions follow the announcement (1) that Utz will merge with Collier Creek Holdings, a special purpose acquisition company to form Utz Brands, Inc. a publicly traded company which will be listed on the New York Stock Exchange. In the transaction, Collier Creek's cash will be used to materially reduce Utz's debt, lowering its debt to EBITDA leverage. The rating outlook is positive. The following ratings/assessments are affected by its action: New Assignments: Issuer: Utz Quality Foods, LLC Speculative Grade Liquidity Rating, Assigned SGL-2 Ratings Affirmed: Issuer: Utz Quality Foods, LLC Senior Secured 1st Lien Term Loan, Affirmed B2 (LGD4) Ratings Upgraded: Issuer: Utz Quality Foods, LLC Corporate Family Rating, Upgraded to B1 from B2 Probability of Default Rating, Upgraded to B1-PD from B2-PD Outlook Actions: Issuer: Utz Quality Foods, LLC Outlook, Changed To Positive From Stable RATINGS RATIONALE The upgrade of the CFR to B1 reflects Moody's expectation that proceeds from the cash previously raised from investors in the SPAC that is held in Collier Creek's trust account will be used to repay over $200 million of Utz's existing first lien debt, significantly reducing debt-to-EBITDA leverage from over 6x as of March 2020 to under 4x. Assuming no redemptions by the public stockholders of Collier Creek, the approximately $457 million of cash in the trust account, together with an additional $35 million of co-invested equity from the sponsors will be used to repay first lien debt, fund transaction expenses, repay preferred stock including accumulated PIK interest, and pay a $60 million special distribution to the current Utz owners. First lien debt repayment could be less than $200 million if there are significant redemptions of the equity in Collier Creek, but maximum redemptions with no other equity issuance would still allow for modest deleveraging to around 5x. In addition to significantly reducing leverage, the transition to a public company will improve transparency and governance beyond that typically expected from privately held companies. Going forward the company will have to meet public reporting standards and will have a balanced, majority independent board which will be complemented by the expertise of several members with considerable food industry and public company experience. Utz's B1 Corporate Family Rating continues to reflect its relatively small share of the attractive salty snack market, its subnational but growing geographic footprint, and modest segment diversification. About 60% of sales are in the company's core geographies (which encompass the eastern US and sections of the Pacific Northwest, South and Midwest,) and approximately 50% of sales are derived from potato chips. The 2019 acquisition of Kennedy Endeavors expanded Utz's presence in the western US by providing access to Tim's Cascade's brand portfolio and its large west coast Direct Store Delivery capability. The snack foods category has good overall growth prospects as consumers continue to shift towards greater snacking throughout the day, although competition in the sector is fierce. The rating also reflects Moody's expectation that Utz will maintain more conservative debt to EBITDA leverage going forward than in the past, as reflected in its net debt to EBITDA target of 3-4x. This is balanced by the expectation that the company will continue to look for acquisitions to grow its US footprint which could temporarily elevate leverage and increase execution risk, and that it will initiate a $25 million annual dividend. The company has seen a surge in demand for its products in the wake of stay at home orders brought on by the coronavirus pandemic. Excess capacity over its 14 manufacturing facilities heading into the demand surge allowed it to quickly ramp up production to meet heightened demand. Moody's believes that this allowed Utz to gain market share and also benefit from greater manufacturing efficiencies. At the same time, Utz's direct to store (DSD) systems assured that it was able to keep products on the shelf with limited out-of-stocks. This will likely drive higher than previously expected sales and profits in 2020, although it will also make comparisons challenging in 2021 as the company cycles the pantry loading that occurred beginning in March. Moody's assigned a speculative grade liquidity rating of SGL-2. This reflects Utz's good liquidity, supported by Moody's expectation for steady free cash flow and significant availability under its $116 million ABL revolving credit facility that expires in August, 2024. Moody's expects free cash flow of roughly $20-$30 million over the next 12 months, which is higher than prior years because of the reduction in cash interest, higher earnings and synergies from the Kennedy Endeavors acquisition. As of March 31st 2020, net of outstanding borrowings and letters of credit, the ABL revolver had availability of roughly $76 million, but the facility was increased from $101 million to $116 million in April, further expanding availability. Moody's expects that the ABL revolver will remain largely undrawn over the next 12-18 months assuming no acquisitions. The credit facility contains a springing fixed charge coverage covenant of 1.0 times. This covenant will spring into effect when availability falls below the greater of 10% of the borrowing base or $8 million. The company faces no near-term debt maturities. The first lien term loan matures in November 2024. The rating on the first lien debt was affirmed at B2 despite the CFR upgrade. This is because the increased secured ABL facility, combined with a smaller amount of first lien debt following anticipated repayment means that there are proportionately more debt facilities with a priority lien on the collateral in the capital structure. An upgrade of the CFR, or a shift in the proportion of first lien debt relative to the ABL (even it if it increased first lien and total debt) could result in an upgrade to the instrument rating in the future. The positive outlook reflects Moody's expectation that Utz will continue to deleverage as it recognizes synergies and undertakes both growth and productivity initiatives. This includes successfully integrating recently acquired Kennedy Endeavors, Inc., which added the Tim's Cascade and Snyder of Berlin salty snack businesses as well as Kitchen Cooked, Inc. The company expects to achieve approximately $7 million in synergies related to these acquisitions, predominately beginning in late 2020/2021. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS To achieve an upgrade, Utz will need to continue to grow scale and operating profits, successfully integrate acquisitions, maintain good liquidity and sustain debt to EBITDA leverage (including Moody's adjustments) below 4.0x. The rating could be downgraded if the company experiences operational difficulties, liquidity weakens, if it engages in large debt financed acquisitions or shareholder returns or if debt-to-EBITDA leverage is expected to be sustained above 5.0x. ESG CONSIDERATIONS The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and asset price declines are creating a severe and extensive credit shock across many sectors, regions and markets. The combined credit effects of these developments are unprecedented. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial credit implications of public health and safety. Notwithstanding, Utz and many other packaged food companies are likely to be more resilient than companies in other sectors. However, some volatility can be expected through 2021 due to uncertain demand characteristics, channel shifting, the potential for supply chain disruptions and difficult comparisons in 2021 following these shifts. Social and environmental risks are not key rating drivers. Utz' governance will benefit from becoming a publicly traded company. The company expects to establish a majority independent board which will initially be comprised of 10 members of which 7 will be independent according to NYSE guidelines; half nominated by Collier Creek and half by the current owners, the Rice and Lissette families, who will maintain a 50.2% economic interest. Moody's views the company's public commitment to a net leverage target of 3-4x to be evidence of a more conservative financial policy than Utz has operated under in recent years as a private company. The principal methodology used in these ratings was Consumer Packaged Goods Methodology published in February 2020. Utz Quality Foods, LLC, headquartered in Hanover, PA, is a branded salty snack producer and marketer. Key products include potato chips, pretzels, cheese snacks, pork skins, pub/party mix, popcorn and tortilla chips. The Company's brand portfolio is well known in its core markets and includes Utz, Golden Flake, Good Health, Zapp's, Dirty, Boulder Canyon, Bachman, Tim's Cascade and Snyder's of Berlin, among others. Pro forma annual net sales are approaching $1 billion. WESTERN DIGITAL: S&P Alters Outlook to Stable, Affirms 'BB+' ICR ---------------------------------------------------------------- S&P Global Ratings affirmed its 'BB+' issuer credit rating on Western Digital Corp. and revised the outlook to stable from negative. S&P expects the company to reduce leverage quickly in fiscal 2021. The outlook revision reflects its view that despite current credit metrics that are still weak for the 'BB+' rating (including adjusted net leverage at 4.3x as of April 3), Western Digital will delever to around 2x in fiscal 2021 (ending in June) given its plan to use cash saved from its suspended dividend to repay debt and EBITDA growth from the flash pricing recovery. The company plans to continue repaying debt until gross leverage reaches $6 billion and net debt reaches $3 billion, compared to current levels of $9.6 billion of gross debt and $6.7 billion of net debt, at which point it will reevaluate its dividend policy. Demand from hyperscale data center customers for high capacity HDDs remains strong despite the weak macroeconomic environment, and the recovery in flash memory pricing continues as industry capacity additions remain rational. The flash memory market has historically had periods of sharp price erosions and rebounds. The trough of the latest cycle happened in calendar 2019 and S&P sees the reversal of this trend continuing in the coming quarters with pricing recovering. After a period of leverage exceeding S&P's 3x downgrade threshold, S&P anticipates stronger free cash flow and the company's commitment to debt repayment to result in leverage falling to 2x in fiscal 2021. The company generated adjusted free operating cash flow (FOCF) of about $100 million in fiscal 2019, which S&P expects to rebound to around $900 million in fiscal 2021. As flash pricing has fallen over time, it has become a more attractive alternative to HDDs for PCs given better performance and S&P expects this trend to continue. Western Digital is naturally hedged against this trend given its participation in both the HDD and flash markets. S&P expects high capacity products for hyperscale data center customers will remain Western Digital's core focus in the HDD segment. Demand is strong because of the cost advantage HDDs have over flash for applications that don't require top speed. Western Digital has a history of debt repayment and it has ambitions to reduce is balance even further. The company lowered its debt from a peak of about $17 billion when it closed its acquisition of SanDisk in May 2016, to less than $10 billion on June 4, 2020. S&P expects the company's leverage ratio will fall meaningfully from current levels given the suspension of its dividend, its goals for debt repayment, and the rebound in EBITDA S&P expects. In S&P's forecast, the company achieves its goal to reduce gross debt to $6 billion and net debt to $3 billion in late fiscal 2023 or 2024; however, the rating agency's forecast does not include a cyclical peak in flash pricing. If one occurs similar to fiscal 2018, the company may reach its goal as early as late fiscal 2022. The outlook on Western Digital is stable, reflecting the company's commitment to use cash flow for debt repayment until gross debt is $6 billion and net debt is $3 billion, which would result in S&P Global Ratings adjustment metrics that are consistent with the 'BB+' rating. Over the coming year, S&P expects the continuing recovery in flash pricing and debt repayment to result in leverage around 2x in fiscal 2021 (ending June). An upgrade is unlikely over the coming year based on the company's debt burden. A higher rating would require the company to operate such that the company will not sustain leverage above 2x during a trough in the flash cycle and FOCF to debt will average 25% through a cycle. If the company achieves its goals for gross and net debt, it would likely satisfy S&P's leverage requirement, but the rating agency will need more information about the company's capital spending plan to determine whether the company would satisfy the rating agency's cash flow requirement. Over the coming year, S&P could lower the rating if prolonged demand weakness and persistent flash pricing erosion lead to further revenue declines and EBITDA margin deterioration. In such a case, S&P would expect leverage to remain above 3x without the prospect of declining below 3x in fiscal 2021. 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