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T R O U B L E D C O M P A N Y R E P O R T E R
Friday, July 10, 2020, Vol. 24, No. 191
Headlines
1934 BEDFORD: Hires Joseph J. Haspel as Litigation Counsel
6TH & CENTER: Taps James F. Dowden as Legal Counsel
84 ALBANY: Seeks to Tap Callaghan Parente as Real Estate Counsel
9469 BEVERLY CREST: Seeks Approval to Hire LEA Accountancy
AKCEL CONSTRUCTION: Taps Latham Luna as Legal Counsel
ALLAN E. GINDI: Wu Buying Irvine Property for $957K
ALPHA BUILDING: Hires Latham Luna as Legal Counsel
ALTA MESA: Court Approves Disclosure Statement
ANDES INDUSTRIES: All Claims to Be Paid in Full in 10 Years
ANEW YOU MEDICAL: Unsecureds to Get $50,000 Over 60 Months
ANGEL'S TOUCH: Court Conditionally Approves Disclosure Statement
ARADIGM CORP: Unsecureds Get Payments From Milestone and Royalty
ARCHDIOCESE OF NEW ORLEANS: Committee Hires Pachulski as Co-Counsel
ARCHDIOCESE OF NEW ORLEANS: Committee Taps Locke Lord as Co-counsel
ASTOR PARTNERSHIP: 18th M Buying DC Property for $1.1 Million
BOUNCE FOR FUN: Seeks Approval to Tap Rosen Systems as Auctioneer
BRISTOW GROUP: Moody's Hikes CFR to B2 & Alters Outlook to Stable
BROOKS BROTHERS: Case Summary & 30 Largest Unsecured Creditors
CACI INTERNATIONAL: Moody's Raises CFR to Ba1, Outlook Stable
CAPSTONE OILFIELD: Seeks Approval to Tap PPL Group as Auctioneer
CARLSON TRAVEL: Fitch Lowers Issuer Default Rating to C
CENTRAL PALM: Committee Taps Brinkman Portillo as Legal Counsel
CHEETAH RENTALS: U.S. Trustee Unable to Appoint Committee
CHISHOLM OIL: Mesa Natural Gas Removed as Committee Member
CLEVELAND-CLIFFS INC: Fitch Assigns B LT IDR, Outlook Negative
COWBOY PUMPING: Seeks Approval to Tap PPL Group as Auctioneer
CRC BROADCASTING: U.S. Trustee Unable to Appoint Committee
CROCKETT COGENERATION: Moody's Hikes Sr. Sec. Notes to B2
D & H HEALTHCARE: Taps Kathleen Nicholson as Accountant
DANIEL T. LEE: Case Summary & 20 Largest Unsecured Creditors
DEFOOR CENTRE: GB Square Buying Atlanta Property for $1.3M
DIXON PAVING: Proposed Sale of Equipment Approved
EASTERN NIAGARA: Case Summary & 20 Largest Unsecured Creditors
ECO BUILDING: Seeks Approval to Hire Bankruptcy Attorney
EF-290: Seeks Court Approval to Hire Hajjar Peters as Counsel
EXGEN RENEWABLES IV: Moody's Hikes Secured Term Loan to Ba3
FLOYD CHARLES YORK: Clark Buying Oxon Hill Property for $335K
FLOYD SQUIRES: Liquidating Agent Selling Eureka Property for $185K
GAMESTOP CORP: Moody's Hikes CFR to B3 & Alters Outlook to Stable
GERALDINE R. ROSINE: Trustee Selling Pinole Property for $360K
GNC HOLDINGS: U.S. Trustee Appoints Creditors' Committee
GVM INC: Exits Chapter 11 Bankruptcy With Liquid Finance's Help
HADDINGTON FUND: Seeks Approval to Tap Scauzillo Firm as Accountant
HEART CONSULTANTS: Seeks to Hire Goren Law as Legal Counsel
HERTZ GLOBAL: To Issue $1 Billion Worth of New Shares
HIGHLAND CAPITAL: Seeks Approval to Retain Services of DSI's CEO
HIGHLAND CAPITAL: Seeks Court Approval to Hire CEO, New CRO
HYTERA COMMUNICATIONS: Committee Taps Levene Neale as Counsel
ICE HOUSE: Seeks to Hire Stinnette Craighead as Accountant
IHEARTCOMMUNICATIONS INC: Moody's Rates New $450MM Term Loan 'B1'
INTERNATIONAL FOOD: Hires Modesto Bigas as Litigation Counsel
INTERNATIONAL FOOD: Taps Schoeman Updike as Special Counsel
INTERSTATE FIRE: Voluntary Chapter 11 Case Summary
JARCO HARVESTING: Seeks to Hire Tarbox Law as Legal Counsel
JORTA PROPERTIES: Sale of Sunderland Property to Bigsbys Approved
LAKEWAY PUBLISHERS: Hires William Foutch as Legal Counsel
LEE HI ASSOCIATES: Seeks to Hire Stinnette Craighead as Accountant
LICK INDUSTRIES: Perrottas Buying Royal Oak Property for $230K
LIP INC: Case Summary & 20 Largest Unsecured Creditors
LONESTAR RESOURCES: Fitch Lowers LT Issuer Default Ratings to C
LONGHORN SERVICE: Seeks Approval to Tap PPL Group as Auctioneer
LUCKY STAR-DEER: Voluntary Chapter 11 Case Summary
LVI INTERMEDIATE: Sets Bid Procedures for Substantially All Assets
LVI INTERMEDIATE: Sets Sale Procedures for Miscellaneous Assets
MANOMAY LLC: Trustee Hires Natalie Lutz Cardiello as Counsel
METAL PARTNERS: Hires Larson & Zirzow as Co-Counsel
METAL PARTNERS: Seeks to Hire High Ridge as Financial Advisor
METAL PARTNERS: Taps Saul Ewing as Legal Counsel
METAL PARTNERS: Taps SSG Advisors as Investment Banker
MEZZ57TH LLC: Seeks to Hire Golden Door Services as Consultant
MICHAEL D. COHEN: Proposes Online Auction of All Assets
MIDTOWN CAMPUS: Taps 'Ordinary Course' Professionals
MLAC CASTLE ATLANTA: Taps Buckley Beal as Special Counsel
MOUNTAIN STATES: May Lay Off 222 Employees Amid Bankruptcy Auction
MULIANG AGRITECH: WWC Raises Substantial Going Concern Doubt
MY SIZE: Discloses Substantial Going Concern Doubt Exists
NAPHTHA ENERGY: Seeks Approval to Tap Walker & Patterson as Counsel
NEIMAN MARCUS: Creditors' Committee Hires Cole Schotz as Co-Counsel
P.P.S. TRUCKING: Seeks Approval to Hire PPL Group as Auctioneer
PANOCHE ENERGY: Moody's Hikes Rating on Sr. Sec. Notes to B1
PEOPLE WHO CARE: Taps Keller Williams as Real Estate Broker
PERMICO MIDSTREAM: Trustee Taps Norton Rose Fulbright as Counsel
PIMLICO RANCH: Seeks to Hire Robert M. Yaspan as Legal Counsel
PROPERTY VENTURES: Hires Turner Legal Group as Bankruptcy Counsel
QUALITY WELDING: Hires Massey Higginbotham as Special Counsel
QUALITY WELDING: Seeks to Hire Byrd & Wiser as Counsel
REGIONAL HOLDING: Seeks to Hire Regional Bankruptcy as Counsel
ROCK CHURCH: Seeks Approval to Hire Bankruptcy Attorney
RSB INVESTMENTS: Seeks to Hire Giddens & Gatton as Legal Counsel
SEHAR INC: Seeks to Hire Barrett McNagny as Special Counsel
SERTA SIMMONS: Moody's Rates New $200MM First Lien Loan 'B2'
SLT HOLDCO: Case Summary & 20 Largest Unsecured Creditors
TAM S.A.: Case Summary & 40 Largest Unsecured Creditors
TAYLOR MORRISON: Moody's Rates Proposed $400MM Unsec. Notes Ba3
THIRD DAY NIPOMO: Case Summary & 8 Unsecured Creditors
TOPAZ SOLAR: Moody's Raises Rating on Sr. Secured Debt to Ba2
TRINIDAD GENERATION: Fitch Lowers Rating on Unsec. Notes to BB+
TRIVASCULAR SALES: Gets Approval to Hire Omni as Claims Agent
TTK RE ENTERPRISE: Sharmin Buying Atlantic City Property for $140K
TUESDAY MORNING: Contingent Sale Procedures for All Assets Approved
U.S. TENNIS: Lays Off 110 Workers, Closes White Plains Office
VETERANS FELLOWSHIP: Sets Bid Procedures for Philly Property
WATSON GRINDING: Trustee Seeks Approval to Hire Special Counsel
WELBILT INC: Moody's Lowers CFR to Caa1 & Alters Outlook to Stable
WEST COAST DISTRIBUTION: Committee Hires Financial Advisor
WG PARTNERS: Moody's Hikes Rating on $245MM Term Loan B to Ba3
YRC WORLDWIDE: Moody's Confirms Caa1 CFR, Outlook Stable
[*] Bankruptcy Courts Accept Equitable Arguments for Rent Delays
[*] BOOK REVIEW: Hospitals, Health and People
*********
1934 BEDFORD: Hires Joseph J. Haspel as Litigation Counsel
----------------------------------------------------------
1934 Bedford, LLC seeks approval from the U.S. Bankruptcy Court for
the Eastern District of New York to employ Joseph J. Haspel PLLC as
special counsel.
The Debtor desires to employ Joseph J. Haspel PLLC to represent the
Debtor in a Secured Creditor's claims objection litigation of the
first mortgage against the property located at 1930 Bedford Avenue,
Brooklyn, New York 11225.
Mr. Haspel will be paid at his hourly rate of $480. He received an
initial retainer of $5,000, which was paid by Nikol Vonlavrinoff, a
managing member of the Debtor.
Joseph J. Haspel, Esq., a partner at Joseph J. Haspel PLLC,
disclosed in court filings that the firm is a "disinterested
person" as such term is defined in Sections 101(14) and 327(a) of
the Bankruptcy Code.
The firm can be reached through:
Joseph J. Haspel, Esq.
JOSEPH J. HASPEL PLLC
1 West Main Street, One Harriman Square
Goshen, NY 10924
Telephone: (845) 294-8950
(845) 694-4409
Facsimile: (845) 232-2293
About 1934 Bedford
1934 Bedford LLC operates and develops a multi-unit building in
Brooklyn, N.Y.
On Aug. 2, 2019, an involuntary petition for relief under Chapter
11 of the Bankruptcy Code was filed against Bedford by creditors
Simply Brooklyn Realty, HTC Construction Management, Inc., HTC
Plumbing, Inc., (Bankr. E.D.N.Y. Case No. 19-44751). Bedford
consented to the entry of an order for relief under Chapter 11 of
the Bankruptcy Code on Sept. 12, 2019.
The creditors are represented by Rosenberg Musso & Weiner, LLP
while Bedford is represented by Loeb & Loeb LLP. The Debtor tapped
Joseph J. Haspel PLLC as special counsel and Aaron Friedman LLC as
special real estate counsel.
Judge Carla E. Craig oversees the case.
6TH & CENTER: Taps James F. Dowden as Legal Counsel
---------------------------------------------------
6th & Center, LLC received approval from the United States
Bankruptcy Court for the Eastern District of Arkansas to hire James
F. Dowden, P.A. as its legal counsel.
James F. Dowden will advise Debtor regarding its duties under the
Bankruptcy Code, and will provide other legal services related to
its Chapter 11 case.
The Debtor will pay the firm's personnel at its hourly rate of
$350. The firm has received a $7,500 retainer prior to Debtor's
bankruptcy filing.
In a court filing, James Dowden, Esq., disclosed that his firm does
not hold interest adverse to the Debtor and its creditors.
The firm can be reached through:
James F. Dowden, Esq.
James F. Dowden, P.A.
212 Center Street, Tenth Floor
Little Rock, AR 72201
Phone: 501-324-4700
Fax: 501-374-5463
Email: jfdowden@swbell.net
About 6th & Center, LLC
6th & Center is a Single Asset Real Estate as defined in 11 U.S.C.
Section 101(51B). The Debtor owns a building located at 6th &
Center Streets, Little Rock, AR having an appraised value of $1.4
million.
6th & Center, LLC, filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Ark. Case No.
20-12694) on June 23, 2020. In the petition signed by Danny
Brickey, member/authorized representative, the Debtor estimated
$1,475,100 in assets and $906,701 in liabilities. James F. Dowden,
Esq. at JAMES F. DOWDEN, P.A. is the Debtor's counsel.
84 ALBANY: Seeks to Tap Callaghan Parente as Real Estate Counsel
----------------------------------------------------------------
84 Albany Ave. Realty Corp. seeks approval from the U.S. Bankruptcy
Court for the Eastern District of New York to employ Daniel Parente
and Callaghan Parente LLP as real estate counsel.
The Debtor seeks to employ Daniel Parente and Callaghan Parente LLP
to represent the Debtor in the proposed sale of its property.
The professional services that the real estate attorneys will
render include:
(a) Drafting, negotiation and execution of Contract of Sale.
(b) Communication with its lending institution, bankruptcy
attorney and tenant's attorneys.
(c) Communication with all parties to the sale including the
title company.
(d) Review of all related documents including the title report
and clearing title. Review of all corporate documents and drafting,
as necessary.
(e) All tenant related matters.
(f) Preparation of all closing and transfer documents.
(g) Attendance and representation at closing.
(h) The Debtor has retained Real Estate Attorneys to sell its
property, subject to bankruptcy court approval.
Real estate attorneys have not been paid a retainer by the Debtor.
All fees shall be subject to Court approval upon application for
compensation to this Court.
The Debtor respectfully request that the retention of Daniel
Parente and Callaghan Parente LLP be made effective nunc pro tunc
to May 30, 2020 so that the firm may be compensated for the
services it will have provided before this Application is heard by
the Court. The firm has provided services to the Debtor in advance
of approval of this application as needed to prepare for the
proposed sale of the Debtor's real estate, and in anticipation that
its retention would be approved nunc pro tunc to May 30, 2020.
The Debtor believes that Daniel Parente and Callaghan Parente LLP
do not represent any interest adverse to the interest of the Debtor
or his estate in the retention upon which they are to be engaged.
The firm can be reached through:
Daniel Parente, Esq.
CALLAGHAN PARENTE LLP
1600 Stewart Avenue Suite 603
Westbury, NY 11590
Telephone: (516) 200-6900
E-mail: dp@cplawny.com
About 84 Albany Ave. Realty
84 Albany Ave. Realty Corp. owns in fee simple a commercial
building with 24,000 sq. ft. of space located in Freeport, NY,
having a current value of $1.05 million.
84 Albany Ave. Realty Corp. filed a voluntary petition under
Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No.
20-11423) on February 28, 2020. The petition was signed by Robert
Bloom, chief executive officer (CEO). At the time of the filing,
the Debtor disclosed estimated assets of $1 million to $10 million
and estimated liabilities of $500,000 to $1 million. Hon. Robert D.
Drain oversees the case. The Debtor is represented by Bronson Law
Offices, P.C.
9469 BEVERLY CREST: Seeks Approval to Hire LEA Accountancy
----------------------------------------------------------
9469 Beverly Crest LLC seeks authority from the United States
Bankruptcy Court for the Central District of California (Los
Angeles) to hire LEA Accountancy, LLP, as its accountant.
The firm will provide the following services:
a. review the Debtor's prior accounting and tax records, the
petition and schedules and the estate's documents related to its
financial transactions;
b. review and analyse the estate's financial transactions;
reconciliation of the Debtor's books and records, preparation of
financial projections for the estate;
c. review and analyse any proposed liquidation of estate
assets generally and in particular related to the sale of the
Debtor's real property located at 9496 Beverlycrest Drive, Los
Angeles, California, to determine the appropriate treatment for tax
purposes, including capital gains calculations, consideration of
tax attributes inherited from the Debtor and other tax
considerations;
d. assist the Debtor in the preparation of documents required
to comply with the Financial Reporting Requirements of the Office
of the United States Trustee;
e. assist the Debtor in preparation of any proposed Plan of
Reorganization;
f. assist the Debtor in preparation and filing of Federal and
California tax returns;
g. communicate with taxing authorities on behalf of the
Debtor; and
h. perform any other financial analysis, investigation,
general accounting services and address any other tax matters which
may be required by the Debtor to properly administer the estate and
maintain tax compliance.
LEA Accountancy will be paid at these hourly rates:
Sam S. Leslie $485
Terry R. Fussell $385
Marianna Falco $335
Timothy D. Kincaid $335
Robert F. Bicher, III $215
Lori J. Ensley $215
Aaron Robson $205
Thomas G. Ballou $240
Sam Leslie, a certified public accountant employed with LEA,
disclosed in a court filing that the firm does not have any
interest adverse to the bankruptcy estate or its creditors.
The firm can be reached through:
Sam S. Leslie
3435 Wilshire Boulevard, Suite 990
Los Angeles, CA 90010
Phone: 213-368-5000
Fax: 213-368-5009
Email: sleslie@trusteeleslie.com
About 9469 Beverly Crest
9469 Beverly Crest LLC classifies its business as Single Asset Real
Estate (as defined in 11 U.S.C. Section 101(51B)). 9469 Beverly
Crest LLC filed a Chapter 11 petition (Bankr. C.D. Cal. Case No.
19-20000) on Aug. 26, 2019, in Los Angeles, California. In the
petition signed by Martin Livingston, managing member, the Debtor
was estimated with assets at $10 million to $50 million, and
liabilities at $1 million to $10 million. Judge Neil W. Bason
oversees the case. DANNING, GILL, DIAMOND & KOLLITZ, LLP, is the
Debtor's counsel.
AKCEL CONSTRUCTION: Taps Latham Luna as Legal Counsel
-----------------------------------------------------
Akcel Construction, LLC, a debtor affiliate of Alpha Building
Group, Inc. in these Chapter 11 cases, seeks approval from the U.S.
Bankruptcy Court for the Middle District of Florida to employ
Justin M. Luna and the law firm of Latham, Luna, Eden & Beaudine,
LLP as counsel.
The legal services to be provided by the law firm include, but not
limited to, the following:
(a) advise as to the Debtor's rights and duties in this case;
(b) prepare pleadings related to this case, including a plan
of reorganization; and
(c) take any and all other necessary action incident to the
proper preservation and administration of this estate.
The standard hourly rates of the firm's attorneys and paralegals
are as follows:
Experienced attorneys $575
Junior paraprofessionals $105
The hourly rates for the attorneys primarily working on this matter
are as follows:
Daniel Velasquez $300
Justin Luna $425
Prior to the commencement of this case, the Debtor paid an advance
fee of $51,717.00 for pre- and post-petition services and expenses
to be incurred in connection with this case.
The firm received $15,594.50, on a current basis, for services
rendered and costs incurred prior to commencement of this case,
including the preparation of the petition for reorganization under
Chapter 11 of the Code and all related initial pleadings filed in
this case, and prepetition expenses in this case, including the
filing fee for the voluntary petition.
To the best of Debtor's knowledge, the firm represents no interest
adverse to the Debtor or to the estate in matters upon which it is
to be engaged, and the employment of the firm would be in the best
interest of the estate.
The firm can be reached through:
Justin M. Luna, Esq.
LATHAM, LUNA, EDEN & BEAUDINE, LLP
111 N. Magnolia Avenue, Suite 1400
P.O. Box 3353 (32802-3353)
Orlando, FL 32801
Telephone: (407) 481-5800
Facsimile: (407) 481-5801
E-mail: jluna@lathlamluna.com
About Akcel Construction
Akcel Construction, LLC is a privately held company that
specializes in providing shell construction services to builders
across Florida and the Southeastern region.
Akcel Construction, LLC and its debtor affiliate, Alpha Building
Group, Inc., sought Chapter 11 protection (Bankr. M.D. Fla. Lead
Case No. 20-03210) on June 8, 2020. The petitions were signed by
Rubi Akooka, managing member. At the time of the filing, each
Debtor disclosed estimated assets of $1 million to $10 million and
estimated liabilities of the same range. The Debtors are
represented by Latham, Luna, Eden & Beaudine, LLP.
ALLAN E. GINDI: Wu Buying Irvine Property for $957K
---------------------------------------------------
Allan Eli Gindi and Carol June Gindi ask the U.S. Bankruptcy Court
for the Central District of California to authorize the bidding
procedures in connection with the sale of their residential real
property located at 4262 Sandburg, Irvine, California to Xiao Wu
for $957,000, subject to overbid.
By Order entered May 5, 2020, the Court approved a sale of the
Property with a purchase price of $982,500. However, due to the
Covid-19 pandemic, the Buyer did not complete the sale. Upon
consideration of the fact that there were no other ready buyers at
the originally agreed upon price and due to the present uncertainty
in the real estate market, the Debtors agreed, subject to Court
approval and overbid, to sell the Property to the same Buyer for
$957,000.
On Feb. 25, 2020, subject to Court approval, the Debtors, entered
into a Residential Purchase Agreement and Joint Escrow Instructions
with the Buyer. Thereafter, on May 22, 3030, the Buyer and the
Debtors entered into an addendum to the Original Purchase
Agreement, which provides for sale of the Property for the purchase
price of $957,000.
The general terms of the Sale Agreement are:
a. Sale price of $957,000;
b. Deposit of $29,200 (already paid), with an additional
deposit of $161,800 and the balance due at closing in the form of
loan proceeds in an amount equal to the remaining balance of the
Purchase Price;
c. The Property is sold "as is";
d. The cost of the owners’ title policies will be paid from
the Debtors' proceeds;
e. Buyer and the Debtors will each pay their own escrow
fees;
f. The Debtors will pay for a home inspection to be conducted
by Home Guard Home Warranty at a cost of $600 as well as the cost
of the appraisal;
g. Real estate broker's commissions in the amount of 5% of
the Purchase Price ($47,850) to be paid 50% to Keller Williams
Realty Irvine, the Debtors' broker and 50% to IRN Realty, the
Seller's broker;
h. The Debtors will cancel the contract and release all the
Buyer’s earnest deposit upon: i) Court rejection of the proposed
sale; ii) upon Court approval of the proposed sale at price higher
than $957,000; iii) in the event the Court approval is not
obtained by June 30, 2020 at 5:00 p.m. (PDT); or iv) the Buyer
experiences a loss of income due to an unforeseen
Coronavirus-related
circumstance (eg.; lay-off, furlough, or reduced salary);
i. The Buyer to close loan within 14 days of Court approval,
exclusive of delay caused by the Seller;
j. The Buyer will incur no penalty fees caused by the Court's
timeline for approval of the sale proposed herein; and
k. Other than the subject sale, the Debtors are otherwise
unrelated to the Buyer.
All discussions regarding the sale of the Property were conducted
in good faith, without collusion, and at arms'-length.
The following liens are recorded against the Property: (i) first
priority lien in favor of New Rez, LLC, with an estimated amount
owing of $680,000; (ii) second priority lien in favor of
Specialized Loan Servicing ("SL"”), with an estimated amount
owing of $25,000; (iii) judgment lien in favor of James Witkowski
in the amount of $10,000; (iv) judgment lien in favor of Pagter &
Perry Isaacson, with an estimated amount owing of $25,000; and (v)
judgment lien in favor of Strategic Funding Source ("SFS") in the
amount of $450,735 as of May 31, 2019.
The following lien, assessments and other amounts due will be paid
through escrow: (i) escrow and title charges estimated at $8,000;
(ii) real estate broker's commissions in the amount of $47,850;
(iii) real property taxes estimated at $0; real property taxes are
paid current through an impound account with the lender; (iv)
unpaid HOA dues; (v) first priority lien in favor of New Rez in the
approximate amount of $680,000; (vi) second priority lien in favor
of SLS in the approximate amount of $25,000; (v) judgment lien in
favor of James Witkowski in the amount of $10,000; (vi) judgment
lien in favor of Pagter & Perry Isaacson , with an estimated
amount
owing of $25,000; and (vii) any amount remaining after payment on
all prior liens and escrow costs will be paid to SFS on account of
its judgment lien.
It is estimated that the Debtor will not incur any capital gains
tax liability form the sale of the Property per the terms set forth
in the Motion.
In the event the Court is closed to public access and the hearing
on the Sale Motion is conducted through Court Call, parties
interested in participating in the overbid process must present the
offer to the counsel for the Debtors at least three business days
prior to the scheduled hearing on the Sale Motion and to obtain
information regarding CourtCall procedures. Michael Spector can be
reached by calling (714) 835-3130, by facsimile at (714) 558-7435
or by email at mgspector@aol.com.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: Three business days prior to the hearing on
the Sale Motion
b. Initial Bid: $967,000
c. Deposit: $25,000
d. Auction: At the hearing on the Sale Motion
e. Bid Increments: $2,000
The Debtors desire to close the sale as soon as practicable after
entry of an order approving the sale. Accordingly, they
respectfully ask that the Court waives the 14-day stay.
A hearing on the Motion was set for June 29, 2020 at 2:00 p.m.
A copy of the Agreement is available at https://tinyurl.com/uen5tuj
from PacerMonitor.com free of charge.
Allan Eli Gindi and Carol June Gindi sought Chapter 11 protection
(Bankr. C.D. Cal. Case No. 19-10198) on Jan. 18, 2019. The Debtors
tapped Michael R. Totaro, Esq., at Totaro & Shanahan, as counsel.
ALPHA BUILDING: Hires Latham Luna as Legal Counsel
--------------------------------------------------
Alpha Building Group, Inc., a debtor affiliate of Akcel
Construction, LLC in these Chapter 11 cases, seeks approval from
the U.S. Bankruptcy Court for the Middle District of Florida to
employ Justin M. Luna and the law firm of Latham, Luna, Eden &
Beaudine, LLP as counsel.
The legal services to be provided by the law firm include, but not
limited to, the following:
(a) advise as to the Debtor's rights and duties in this case;
(b) prepare pleadings related to this case, including a plan
of reorganization; and
(c) take any and all other necessary action incident to the
proper preservation and administration of this estate.
The standard hourly rates of the firm's attorneys and paralegals
are as follows:
Experienced attorneys $575
Junior paraprofessionals $105
The hourly rates for the attorneys primarily working on this matter
are as follows:
Daniel Velasquez $300
Justin Luna $425
Prior to the commencement of this case, the Debtor paid an advance
fee of $51,717.00 for pre- and post-petition services and expenses
to be incurred in connection with this case. The payment was to
satisfy a debt that Akcel Construction owed to Alpha Building
Group.
The firm received $8,572.00, on a current basis, for services
rendered and costs incurred prior to commencement of this case,
including the preparation of the petition for reorganization under
Chapter 11 of the Code and all related initial pleadings filed in
this case, and prepetition expenses in this case, including the
filing fee for the voluntary petition.
To the best of Debtor's knowledge, the firm represents no interest
adverse to the Debtor or to the estate in matters upon which it is
to be engaged, and the employment of the firm would be in the best
interest of the estate.
The firm can be reached through:
Justin M. Luna, Esq.
LATHAM, LUNA, EDEN & BEAUDINE, LLP
111 N. Magnolia Avenue, Suite 1400
P.O. Box 3353 (32802-3353)
Orlando, FL 32801
Telephone: (407) 481-5800
Facsimile: (407) 481-5801
E-mail: jluna@lathlamluna.com
About Alpha Building Group
Alpha Building Group, Inc., a construction company in Maitland,
Florida, and Akcel Construction, LLC sought Chapter 11 protection
(Bankr. M.D. Fla. Lead Case No. 20-03210) on June 8, 2020. The
petitions were signed by Rubi Akooka, managing member. At the time
of the filing, each Debtor disclosed estimated assets of $1 million
to $10 million and estimated liabilities of the same range. The
Debtors are represented by Latham, Luna, Eden & Beaudine, LLP.
ALTA MESA: Court Approves Disclosure Statement
----------------------------------------------
On May 27, 2020, the Honorable Marvin Isgur of the U.S. Bankruptcy
Court for the Southern District of Texas, entered findings of fact,
conclusions of law, and order confirming the Amended Joint Chapter
11 Plan of Alta Mesa Resources affiliates identified as the KFM
Debtors, namely Kingfisher Midstream, LLC ("KFM"), Kingfisher STACK
Oil Pipeline, LLC, Oklahoma Produced Water Solutions, LLC, and
Cimarron Express Pipeline, LLC. The judge also approved, on a
final basis, the Disclosure Statement.
The Effective Date of the Plan occurred on June 8, 2020.
All requests for payment of Administrative Expense Claims must be
filed with the Bankruptcy Court as set forth in the Confirmation
Order no later than July 8, 2020.
Any Person that asserts a Priority Tax Claim, Other Priority Claim,
or Other Secured Claim must file a Proof of Claim with respect to
such Claim with the Bankruptcy Court as set forth in the
Confirmation Order no later than July 8, 2020.
Attorneys for Post-Effective Date KFM Debtors:
Alfredo R. Perez
WEIL, GOTSHAL & MANGES LLP
700 Louisiana Street, Suite 1700
Houston, Texas 77002
Telephone: (713) 546-5000
Facsimile: (713) 224-9511
E-mail: Alfredo.Perez@weil.com
- and -
Ray C. Schrock, P.C.
Kelly DiBlasi
Lauren Tauro
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
E-mail: Ray.Schrock@weil.com
Kelly.DiBlasi@weil.com
Lauren.Tauro@weil.com
About Alta Mesa Resources
Alta Mesa Resources, Inc., is an independent energy company focused
on the development and acquisition of unconventional oil and
natural gas reserves in the Anadarko Basin in Oklahoma, and through
Kingfisher Midstream, LLC, provides best-in-class midstream energy
services, including crude oil and gas gathering, processing and
marketing and produced water disposal to producers in the STACK
play.
Alta Mesa reported $1.4 billion in assets and $864 million in
liabilities as of Dec. 31, 2018.
Alta Mesa and six affiliates sought Chapter 11 protection (Bankr.
S.D. Tex. Case No. 19-35133) on Sept. 11, 2019.
The Hon. Marvin Isgur is the case judge.
The Debtors tapped Porter Hedges LLP and Latham & Watkins LLP as
attorneys; and Perella Weinberg Partners LP and its affiliate Tudor
Pickering Holt & Co Advisors LP as investment banker. Prime Clerk
LLC is the claims agent.
ANDES INDUSTRIES: All Claims to Be Paid in Full in 10 Years
-----------------------------------------------------------
Andes Industries, Inc. and PCT International, Inc., submitted a
Joint Plan and a Disclosure Statement.
Generally speaking, the Plan calls for the payment, in full, of all
claims against the Debtors' bankruptcy estates, to the extent they
are ultimately allowed by the Court. Although some classes of
creditors will be paid sooner, the Plan will provide for the
payment of all allowed claims by the tenth anniversary of the
Plan's Effective Date. The Plan will be funded through the Debtors'
continued operations and $2,000,000 in cash that will be paid by a
newly-formed company in exchange for the equity interests in
Andes.
Class 3-A - Allowed Unsecured Claims of Critical Vendors and Class
3-B - Allowed General Unsecured Claims. Both Classes will be paid
in full, with interest accruing from the Effective Date on the
unpaid balance of their respective claims at the Federal Judgment
Rate, on or before the tenth anniversary of the Effective Date.
Class 3-C - Allowed General Unsecured Claims of the Judgment
Creditors. The claims in this Class will be paid, in full, with
interest accruing at the federal judgment rate provided for in the
Petitioning Creditors' pre-petition judgments, in quarterly
installments, over the course of ten years.
Class 3-D - Allowed Unsecured Claims of Subsidiaries. This Class
consists of the Allowed Unsecured Claims of PCT Yantai and PCT
Vietnam. As of the petition date, PCTY held a claim against PCT in
the approximate amount of $37,000,000. As of the Petition Date,
PCTV held a claim against PCT in the approximate amount of
$6,211,000. Subsequent to the Petition Date, with the approval of
the Court, PCTV was paid $200,000, leaving it with an unpaid claim
in the amount of approximately $6,011,000. If, and only if, the
Debtors' Plan is confirmed (a) PCTY will waive the unpaid balance
of its claim against PCT, and (b) PCTV will reduce its claim by
$4,000,000. The remaining unpaid balance of PCTV's claim, in the
approximate amount of $2,011,000 will be paid in the same fashion
as the claims included within Class 3-B.
Class 3-E Allowed Unsecured Indemnification Claim of Steven
Youtsey. This Class consists of a Claim held by Mr. Youtsey, in the
approximate amount of $2,221,000. If, and only if, the Debtors'
Plan is confirmed, Mr. Youtsey will subordinate the payment of this
Claim, and not receive any payment on account of this Claim until
all other Allowed Claims are paid in full. When all other allowed
claims are paid under the Plan, this Claim will be repaid on terms
acceptable to the Debtors and Mr. Youtsey.
The Plan will be funded through the Debtors' continued operations
and $2,000,000 in cash that will be paid by a newly-formed company
in exchange for the equity interests in Andes.
A full-text copy of the Joint Disclosure Statement dated June 8,
2020, is available at https://tinyurl.com/yddrqhr5 from
PacerMonitor.com at no charge.
Attorneys for the Debtors:
Wesley D. Ray
Philip R. Rudd
SACKS TIERNEY P.A.
4250 N. Drinkwater Blvd., 4th Floor
Scottsdale, AZ 85251-3693
Telephone: 480.425.2600
Facsimile: 480.970.4610
E-mail: Wesley.Ray@SacksTierney.com
Philip.Rudd@SacksTierney.com
About Andes Industries
and PCT International
Creditors EZconn Corporation, Crestwood Capital Corporation, and
Devon Investment Inc. filed involuntary bankruptcy petitions
against Andes Industries, Inc. and PCT International, Inc. under
Chapter 7 of the Bankruptcy Code in the U.S. Bankruptcy Court for
the District of Arizona.
On Dec. 4, 2019, the Chapter 7 cases were converted to cases under
Chapter 11 (Bankr. D. Ariz. Lead Case No. 19-14585).
Judge Paul Sala oversees the cases.
Sacks Tierney P.A. is the Debtors' legal counsel.
ANEW YOU MEDICAL: Unsecureds to Get $50,000 Over 60 Months
----------------------------------------------------------
Margaret Sheryl Wehner and Anew You Medical Weight Loss and Spa,
PLLC, submitted a Chapter 11 Plan and Disclosure Statement.
Sherry is a licensed physician and is the sole owner of Anew. She
also has a 25% membership interest in 1920 Woodlawn Partners, LLC
which owns certain real property in San Antonio on which several
non-profit businesses operate. The Debtor shall pay its
administrative costs in full within 30 days of the Effective Date
or by such other mutually agreeable terms as the parties may
agree.
Class 4 - Ascentium Capital, LLC, has a secured claim in the amount
of $32,000 and an unsecured claim of $191,217. The secured portion
was to be repaid in monthly payments of $975 with interest at 5%
per annum. Debtor proposes to pay $45,000 over a period of five
years in equal monthly payments of $975 which includes interest at
4% per annum in full satisfaction of Ascentium's secured claim.
This class will be impaired.
Class 6 - Balboa Capital. Balboa Capital has filed a claim (No.
11) in both bankruptcies in the amount of $133,707. Of this
amount, Balboa asserts that $61,000 is secured and the balance is
unsecured. The Debtor proposes to pay $15,000 over a period of two
years in equal monthly payments of $652 which includes interest at
4% per annum in full satisfaction of both Balboa's secured and
unsecured claim. This class will be impaired and disputed.
Class 7 - Great American Finance Serv. Great American Financial
Service has filed a claim (No. 9) in both bankruptcies in the
amount of $67,468. Of this amount, Great American asserts that
$30,000 is secured and the balance is unsecured. The Debtor
proposes to pay $5,000 over a period of two years in equal monthly
payments of $218 which includes interest at 4% per annum in full
satisfaction of both Great American's secured and unsecured claim.
This class will be impaired and disputed.
Class 8 - Frost Bank. Frost Bank has filed a claim (No. 10) in
both bankruptcies in the amount of $1,154,112. The Debtor proposes
to pay $500,000 over a period of six years in equal monthly
payments of $7,000 in full satisfaction of both Frost secured and
unsecured claim. This class will be impaired and disputed as to
whether the debt is non-dischargeable.
Class 9 General Unsecured Claims. General unsecured creditors will
be paid the sum of $50,000 over a period of 60 months from and
after the Effective Date, together with interest at 1.5%. The
first payment will be made the first day of the second full month
following the Effective Date. The estimated payment is $866. Upon
satisfactory completion of this payment schedule, the Debtor will
not be under any further or continuing obligation to creditors in
this class, and the respective claims of each will be deemed
satisfied and extinguished.
Alternatively, If, as a condition to confirmation of the Plan, the
Debtor is required to address the "absolute priority rule," as set
forth in 11 U.S.C. Sec. 1129(b)(2)(B)(ii), the Debtor will invoke
the "new value exception." The Debtor proposes to contribute
$50,000 to the Class 9 general unsecured creditor class. This will
come from the debtor shall on a limited basis waive her homestead
rights on her home at 18 Rogers Wood, San Antonio, Texas 78248.
The Debtor will allow her homestead to be encumbered with a deed of
trust lien on her homestead securing debt in the maximum amount of
$50,000. This deed of trust shall secure a note executed by the
Debtor in favor of the holders of allowed unsecured claims. This
Note will accrue interest at the fixed rate of 1.5% and will be
repaid by way of 60 equal monthly payments of principal and
interest, commencing the first date Of the first full month
following the Effective Date and continuing thereafter until paid
in full. This class will be impaired.
Class 10 - Equity Security. Margaret Sherry Wehner will retain her
interest in Anew and the Woodlawn Partners, Ltd.
A full-text copy of the Disclosure Statement dated June 8, 2020, is
available at https://tinyurl.com/ybv6qphc from PacerMonitor.com at
no charge.
Attorney for the Debtors:
Dean W. Greer
DEAN W. GREER
2929 Mossrock, Suite 117
San Antonio, Texas 78230
Telephone 210.342.7100
Facsimile No. 210.342.3633
About Anew You Medical Weight
Loss and Spa LLC
Anew You Medical Weight Loss and Spa PLLC is a non-public
corporation founded in 2016 in the medical wellness business. It
offers a variety of services, including weight loss, IV therapy,
laser hair removal, skin treatments, coolsculpting, hormone
therapy, and hair rejuvenation.
Anew You Medical Weight Loss and Spa sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No.
19-51171) on May 15, 2019. The case is jointly administered with
the Chapter 11 case of Margaret Sheryl Wehner, the Debtor's
managing member (Bankr. W.D. Tex. Case No. 19-51172). At the time
of the filing, Anew estimated assets of between $1 million and $10
million and liabilities of the same range. The cases are assigned
to Judge Craig A. Gargotta. The Law Offices of Dean W. Greer is
Anew's legal counsel.
ANGEL'S TOUCH: Court Conditionally Approves Disclosure Statement
----------------------------------------------------------------
Robert H. Jacobvitz has ordered that the Disclosure Statement of An
Angel's Touch, LLC, a New Mexico Limited Liability Company, is
conditionally approved.
A hearing to consider final approval of the Disclosure Statement
and confirmation of the Plan will be held before the Honorable
Robert H. Jacobvitz on July 16, 2020 at 1:30 p.m., in the Gila
Courtroom, Fifth Floor, Pete V. Domenici Federal Building and
United States Courthouse, 333 Lomas Blvd. NW, Albuquerque, New
Mexico.
July 7, 2020, is fixed as the last day for filing and serving
written objections to the Disclosure Statement and confirmation of
the Plan.
Attorneys for the Debtor:
James A. Askew
Daniel A. White
1122 Central Ave. SW, Suite 1
Albuquerque, NM 87102
Telephone: (505) 433-3097
About An Angel's Touch
An Angel's Touch LLC, which provides non-emergency transportation
services, sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D.N.M. Case No. 19-11394) on June 11, 2019. In the
petition signed by its managing member, Nichole Jones, the Debtor
was estimated to have assets of less than $500,000 and debts of $10
million. Judge Robert H. Jacobvitz is assigned to the case. Askew
& Mazel, LLC, serves as Debtor's counsel.
ARADIGM CORP: Unsecureds Get Payments From Milestone and Royalty
----------------------------------------------------------------
Aradigm Corporation filed a Modified Combined Chapter 11 Plan and
Disclosure Statement provides for the distribution of the proceeds
of the liquidation of the assets of Aradigm.
Aradigm is a publicly traded emerging specialty pharmaceutical
company focused on the development and commercialization of
products for the treatment and prevention of severe respiratory
diseases. Aradigm's lead product candidate completed two Phase 3
trials. However, the Federal Drug Administration declined to
approve the drug and requested that Aradigm conduct an additional
Phase 3 trial. Aradigm estimated that a Phase 3 trial would cost
approximately $75 million and take at least three years to
complete.
Addressing the delays Aradigm experienced obtaining regulatory
approval and the FDA's request for an additional Phase 3 trial
would have required significant expenditures which Aradigm lacked
the capital to fund. Grifols, S.A., Aradigm's principal funding
partner, indicated that it was unwilling to fund the new Phase 3
trial and that it was unwilling to continue to fund Aradigm.
Aradigm therefore determined that it needed to seek a buyer for its
assets. Aradigm filed this chapter 11 case on February 15, 2019 in
order to conserve its cash resources and to pursue a sale of its
assets.
From the outset of the bankruptcy case, Aradigm's objective was to
pursue a sale of its assets. The sales process was extremely
complex as a result of the License and Collaboration Agreement
between Grifols and Aradigm. In broad terms, the Grifols License
distinguishes between the right to pursue regulatory approval of
Aradigm's drug candidates, Aradigm's intellectual property, and the
right to manufacture the product, on the one hand, and the right to
commercialize the product once approved on the other. In the
Grifols License, Aradigm granted to Grifols an exclusive worldwide
license to commercialize the product, in return for milestone
payments and a royalty stream once the product was commercialized,
while Aradigm retained ownership of the intellectual property and
the exclusive right to pursue regulatory approval and to
manufacture the product. Thus, Grifols controls the commercial
rights to the product, while Aradigm controls the development and
owns the underlying intellectual property.
Due to the complexity of Aradigm's assets, the sales process was
delicate and difficult. Aradigm retained EMA Partners, LLC to act
as its investment banker and to assist Aradigm in the sale process.
EMA Partners conducted a robust sales process. EMA Partners
identified and contacted over 50 potentially interested parties.
Fourteen of these parties expressed interest and evaluated the
opportunity. As a result of these efforts, there were multiple
interested parties. One of these interested parties submitted a
bid. This bid was subject to significant contingencies which, in
Aradigm's view, made the bid unattractive.
Grifols made a proposal to Aradigm to purchase Aradigm's assets.
The proposal contemplated a cash payment, additional cash payments
upon the achievement of certain milestones and royalty payments
based upon sales of the product. After negotiations, Aradigm
determined that Grifols' proposal was the superior bid. Aradigm
therefore accepted Grifols' proposal and encouraged the competing
bidder to submit a higher and better bid at the auction.
The Grifols License was a significant complicating factor. Grifols
advised Aradigm that Grifols simultaneously was negotiating a
transaction with a third party. Aradigm understood that as a
practical matter Aradigm's transaction with Grifols was contingent
on the successful outcome of Grifols' negotiations with Party X.
Grifols and Aradigm signed an asset purchase agreement on Feb. 18,
2020. The APA provided that the sale was subject to overbids
through an auction process in the Bankruptcy Court and did not
impose any limitations on Aradigm's ability fully to market its
assets to other interested parties.
Under the APA, Aradigm agreed to sell all of its intellectual
property assets and certain other assets to Grifols. The purchase
price was $3,247,000 in cash payable at closing, plus milestone
payments amounting to an additional $3 million and a royalty of 25%
of the royalties received by Grifols during the royalty term in
connection with the sale of any Aradigm Product under any
definitive agreement between Grifols and any licensee for the
development and commercialization of any Aradigm Product. The
Milestone Payments are payable $2 million upon FDA approval of any
Aradigm Product and $1 million upon EMA approval of any Aradigm
Product. The royalty term is the shorter of 10 years after the
first commercial sale of an Aradigm Product or the expiration of
the last Aradigm Patent covering an Aradigm Product. In addition,
Grifols and its affiliate Grifols Worldwide Operations, Limited,
agreed to waive their filed proofs of claim in the Bankruptcy Case
in the total amount of $31,735,899.
After the APA was signed, Aradigm and EMA Partners continued to
market Aradigm's assets to interested parties. However, no party
submitted a competing bid. Aradigm therefore cancelled the
scheduled auction and requested that the Court approve the sale to
Grifols on the terms set forth in the APA. On March 30, 2020 the
Bankruptcy Court entered an order approving the sale. The sale
closed on March 31, 2020. After repayment of the DIP Loans as
described below, and payment of certain cure costs, Aradigm
received net cash proceeds of $834,933.
The remainder of the consideration payable to Aradigm is in the
form of the Milestone Payments and the Royalty Payments. Whether
and when Aradigm will receive the Milestone Payments and the
Royalty Payments is uncertain and subject to several risks.
The Plan provides for the creation of a Liquidating Trust, to be
administered by a Liquidating Trustee, to collect, sell or
otherwise dispose of the assets of Aradigm's estate, including the
contingent, deferred consideration received from the sale of
Aradigm's assets, and to distribute the net proceeds to creditors
and shareholders. Aradigm has no secured creditors. The Plan
places all prepetition priority unsecured creditors in one class,
places all general unsecured creditors in a single class and places
all shareholders in a single class. The term of the Plan is five
years, unless extended by order of the Court.
The Liquidating Trust will be funded by Aradigm's cash on hand.
The Liquidating Trust will not receive significant additional cash,
if at all, until the Milestone Payments are received in
approximately 3 to 5 years. Aradigm projects that its cash will be
sufficient to pay all administrative expenses on the Effective Date
of the Plan, to fund payment in full of the Class 1 priority wage
claims and to fund the Liquidating Trust's operations until the
Milestone Payments are received. The Liquidating Trust most likely
will not have significant activity unless and until the Milestone
Payments are received. Furthermore, no distribution will be made to
class 2 unsecured creditors unless and until the Milestone Payments
are received and no distribution will be made to class 3 equity
holders unless and until sufficient Milestone Payments and Royalty
Payments have been received to pay class 2 unsecured creditors in
full with interest.
The Trustee of the Liquidating Trust will be subject to the
oversight of Bleichroeder, L.P.. Bleichroeder is Aradigm's second
largest shareholder, holding through the investment funds it
manages approximately 26% of Aradigm's stock, and is now its
largest creditor, with a claim based on notes and convertible notes
of approximately $4.4 million. So long as the Bankruptcy Case
remains open, the Trustee of the Liquidating Trust shall file with
the Bankruptcy Court and serve upon Bleichroeder the Quarterly
Post-Confirmation Reports required by Section 7.2 of the Guidelines
of the Office of the United States Trustee. After the Bankruptcy
Case is closed, for so long as the Liquidating Trust shall remain
in existence, the Trustee of the Liquidating Trust shall prepare
and send Bleichroeder an annual report of the cash receipts and
disbursements of the Trust. In addition, the Trustee of the
Liquidating Trust shall send the information requested by holders
of allowed claims and interests as provided in Section 3.4 of the
Liquidating Trust Agreement. Aradigm believes that requiring the
Liquidating Trustee to report only to Bleichroeder, the largest
creditor and second largest shareholder, is protective of creditors
and shareholders and is the most efficient and cost effective way
to proceed. The Bankruptcy Court has advised that any creditor or
shareholder that disagrees or objects may make its views known at
the hearing to confirm the Plan on June 10, 2020.
The alternative to the Plan is to convert the Bankruptcy Case to a
case under chapter 7 of the Bankruptcy Code. If this were to occur,
a chapter 7 trustee would be appointed to administer Aradigm's
assets, including collection of the Milestone Payments and the
Royalty Payments and the distribution of the proceeds to creditors
and, after creditors are paid in full, plus interest, to
shareholders.
Aradigm believes that the creation of the Liquidating Trust and the
appointment of a liquidating trustee is superior to conversion of
the Bankruptcy Case to chapter 7 and the appointment of a chapter 7
trustee for the following reasons:
A chapter 7 trustee is statutorily directed to close the bankruptcy
estate "as expeditiously as is compatible with the best interests
of parties in interest." 11 U.S.C. Sec. 704(a)(1). The directive
to close the case expeditiously could create an incentive for the
chapter 7 trustee to sell the rights to receive the future
Milestone Payments and the future Royalty Payments at a discount.
Furthermore, the statutory directive is inconsistent with the
potential 15 year term for the receipt of the Milestone Payments
and the Royalty Payments. Aradigm believes that a liquidating
trustee is better situated to collect these payments over the
potentially lengthy term.
A liquidating trust receives favorable tax treatment compared to a
chapter 7 bankruptcy estate.
A chapter 7 trustee will be more expensive if the Milestone
Payments and the Royalty Payments are received. A chapter 7 trustee
is entitled to the statutory commission calculated as provided in
11 U.S.C.§ 704(a)(1) on all funds distributed by the trustee while
the liquidating trustee will be paid an hourly rate. The statutory
commission is a sliding scale for amounts distributed under $1
million and is three percent (3%) of all amounts over $1 million.
Aradigm submits that if the Milestone Payments and the Royalty
Payments are received, the chapter 7 trustee's three percent
statutory commission will be higher than the hourly fee charged by
the liquidating trustee.
Finally, Aradigm believes that a liquidating trust will better
protect the interests of creditors and shareholders, particularly
with respect to making distributions to shareholders many years in
the future if sufficient Royalty Payments to fund such payments are
received.
Class 2 General Unsecured Creditors will receive pro rata payments
from Milestone Payments and Royalty Payments, if and When Received.
Class 3 Shareholders will receive pro rata payments from Milestone
Payments and Royalty Payments, if and when received, after Class 2
is paid in full, with interest.
A full-text copy of the Modified Combined Chapter 11 Plan and
Disclosure Statement dated June 8, 2020, is available at
https://tinyurl.com/y94tkybm from PacerMonitor.com at no charge.
Attorneys for the Debtor:
Bennett G. Young
JEFFER MANGELS BUTLER & MITCHELL LLP
Two Embarcadero Center, 5th Floor
San Francisco, California 94111-3813
Telephone: (415) 398-8080
Facsimile: (415) 398-5584
E-mail: byoung@jmbm.com
About Aradigm Corporation
Aradigm Corporation -- http://www.aradigm.com/-- is an emerging
specialty pharmaceutical company focused on the development and
commercialization of products for the treatment and prevention of
severe respiratory diseases. Over the last decade, the company
invested a large amount of capital to develop drug delivery
technologies, particularly the development of a significant amount
of expertise in respiratory (pulmonary) drug delivery as
incorporated in its lead product candidate that recently completed
two Phase 3 clinical trials, Linhaliq inhaled ciprofloxacin,
formerly known as Pulmaquin. The company is headquartered in
Hayward, Calif.
Aradigm Corporation sought Chapter 11 protection (Bankr. N.D. Cal.
Case No. 19-40363) on Feb. 15, 2019. In the petition signed by
John M. Siebert, executive chairman and interim principal executive
officer, the Debtor was estimated to have $10 million to $50
million in both assets and liabilities.
The case is assigned to Judge William J. Lafferty.
The Debtor tapped Jeffer, Mangels, Butler & Mitchell LLP as
bankruptcy counsel; Sheppard Mullin Richter & Hampton LLP as
special patent counsel; and EMA Partners, LLC as investment banker.
ARCHDIOCESE OF NEW ORLEANS: Committee Hires Pachulski as Co-Counsel
-------------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed to the
Chapter 11 case of The Roman Catholic Church of the Archdiocese of
New Orleans seeks approval from the U.S. Bankruptcy Court for the
Eastern District of Louisiana to employ Pachulski Stang Ziehl &
Jones LLP (PSZJ) as its co-counsel.
Locke Lord will perform the following services, which include but
are not limited to:
(a) assisting, advising and representing the Committee in its
consultations with the Debtor regarding the administration of this
Case;
(b) assisting, advising and representing the Committee in
analyzing the Debtor's assets and liabilities, investigating the
extent and validity of liens and participating in and reviewing any
proposed asset sales, any asset dispositions, financing
arrangements and cash collateral stipulations or proceedings;
(c) assisting, advising, and representing the Committee in any
manner relevant to reviewing and determining the Debtor's rights
and obligations under leases and other executory contracts;
(d) assisting, advising, and representing the Committee in
investigating the acts, conduct, assets, liabilities, and financial
condition of the Debtor, the Debtor's operations and the
desirability of the continuance of any portion of those operations,
and any other matters relevant to this case or to the formulation
of a plan;
(e) assisting, advising, and representing the Committee in its
participation in the negotiation, formulation, and drafting of a
plan of liquidation or reorganization;
(f) advising the Committee on the issues concerning the
appointment of a trustee or examiner under section 1104 of the
Bankruptcy Code;
(g) assisting, advising, and representing the Committee in
understanding its powers and its duties under the Bankruptcy Code
and the Bankruptcy Rules and in performing other services as are in
the interests of those represented by the Committee;
(h) assisting, advising, and representing the Committee in the
evaluation of claims and on any litigation matters, including
avoidance actions and claims against directors and officers and any
other party; and
(i) providing such other services to the Committee as may be
necessary or appropriate in this case.
PSZJ will work with co-counsel Locke Lord, LLP to avoid duplication
of services.
The standard hourly rates for the PSZJ attorneys who are expected
to primarily work on this matter are below:
James I. Stang $1,195
Linda F. Cantor $1,075
Joshua M. Fried $925
The firm agrees to cap its fees to the extent the fees incurred
under the standard hourly rates exceed a blended hourly rate of
$700.
PSZJ will also seek reimbursement for actual and necessary expenses
incurred in connection with its engagement by the Committee in this
case.
Linda F. Cantor, a partner with Pachulski Stang Ziehl & Jones LLP,
disclosed in court filings that the firm is a "disinterested
person" as that term is defined in section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
James I. Stang, Esq.
Linda F. Cantor, Esq.
PACHULSKI STANG ZIEHL & JONES LLP
Santa Monica Blvd., Suite 1300
Los Angeles, CA 90067
Telephone: (310)-277-6910
Facsimile: (310)-201-0760
E-mail: jstang@pszjlaw.com
lcantor@pszjlaw.com
About the Archdiocese of New Orleans
The Roman Catholic Church of the Archdiocese of New Orleans is a
non-profit religious corporation incorporated under the laws of the
State of Louisiana. For more information, visit
https://www.nolacatholic.org/
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.
Judge Meredith S. Grabill oversees the case.
The archdiocese is represented by Jones Walker LLP. Donlin, Recano
& Company, Inc. is the claims agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on May 20, 2020. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP and Locke Lord, LLP.
ARCHDIOCESE OF NEW ORLEANS: Committee Taps Locke Lord as Co-counsel
-------------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed to the
Chapter 11 case of The Roman Catholic Church of the Archdiocese of
New Orleans seeks approval from the U.S. Bankruptcy Court for the
Eastern District of Louisiana to employ Locke Lord LLP as its
co-counsel.
Locke Lord will perform the following services, which include but
are not limited to:
(a) assisting, advising and representing the Committee in its
consultations with the Debtor regarding the administration of this
Case;
(b) assisting, advising and representing the Committee in
analyzing the Debtor's assets and liabilities, investigating the
extent and validity of liens or other interests in the Debtor's
property and participating in and reviewing any proposed asset
sales, any asset dispositions, financing arrangements and cash
collateral stipulations or proceedings;
(c) reviewing and analyzing all applications, motions, orders,
statements of operations and schedules filed with the Court by the
Debtor or third parties, advising the Committee as to their
propriety, and, after consultation with the Committee, taking
appropriate action;
(d) preparing necessary applications, motions, answers,
orders, reports and other legal papers on behalf of the Committee;
(e) representing the Committee at hearings held before the
Court and communicate with the Committee regarding the issues
raised, as well as the decisions of the Court;
(f) performing all other legal services for the Committee
which may be necessary and proper in this Case and any related
proceeding(s);
(g) representing the Committee in connection with any
litigation, disputes or other matters that may arise in connection
with this Case or any related proceeding(s);
(h) assisting, advising and representing the Committee in any
manner relevant to reviewing and determining the Debtor's rights
and obligations under leases and other executory contracts;
(i) assisting, advising and representing the Committee in
investigating the acts, conduct, assets, liabilities and financial
condition of the Debtor, the Debtor's operations and the
desirability of the continuance of any portion of those operations,
and any other matters relevant to this Case;
(j) assisting, advising and representing the Committee in
their participation in the negotiation, formulation and drafting of
a plan of liquidation or reorganization;
(k) assisting, advising and representing the Committee on the
issues concerning the appointment of a trustee or examiner under
section 1104 of the
Bankruptcy Code;
(l) assisting, advising and representing the Committee in
understanding its powers and its duties under the Bankruptcy Code
and the Bankruptcy Rules and in performing other services as are in
the interests of those represented by the Committee;
(m) assisting, advising and representing the Committee in the
evaluation of claims and on any litigation matters, including
avoidance actions; and
(n) providing such other services to the Committee as may be
necessary in this Case or any related proceeding(s).
Locke Lord will work with co-counsel Pachulski Stang Ziehl & Jones,
LLP to avoid duplication of services.
Locke Lord proposes to cap its rate for attorneys working on the
case at $500 per hour and $125 for paraprofessionals, and all
subject to application and approval by this Court pursuant to
Sections 330 and 331 of the Bankruptcy Code.
The standard rates of the firm's attorneys who will primarily work
on this matter are below:
C. Davin Boldissar $650
Omer F. Kuebel, III $960
Natalie White $325
Bradley Knapp $425
Locke Lord will also seek reimbursement for actual and necessary
expenses incurred in connection with its engagement by the
Committee in this case.
C. Davin Boldissar, a partner with Locke Lord, LLP, disclosed in
court filings that the firm is a "disinterested person" as that
term is defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
C. Davin Boldissar, Esq.
Omer F. Kuebel, III, Esq.
LOCKE LORD LLP
601 Poydras Street, Suite 2660
New Orleans, LA 70130-6036
Telephone: (504) 558-5111
Facsimile: (504) 558-5200
E-mail: dboldissar@lockelord.com
rkuebel@lockelord.com
About the Archdiocese of New Orleans
The Roman Catholic Church of the Archdiocese of New Orleans is a
non-profit religious corporation incorporated under the laws of the
State of Louisiana. For more information, visit
https://www.nolacatholic.org/
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.
Judge Meredith S. Grabill oversees the case.
The archdiocese is represented by Jones Walker LLP. Donlin, Recano
& Company, Inc. is the claims agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on May 20, 2020. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP and Locke Lord, LLP.
ASTOR PARTNERSHIP: 18th M Buying DC Property for $1.1 Million
-------------------------------------------------------------
Astor Partnership, LLC, asks the U.S. Bankruptcy Court for the
District of Columbia to authorize the sale of the real property and
improvements, consisting of a 12-unit apartment building, located
at 5058 Astor Place, SE, Washington, DC under the terms and
conditions of the GRAAR Sales Contract, dated May 12, 2020, to 18th
M, LLC for $1.1 million.
The Debtor's only asset consists of the apartment building, i.e.
the Property which it asks authority to sell. The Property is
subject to an Abatement Plan entered in the Superior Court of the
District of Columbia in a receivership action filed by the District
of Columbia in Case Number 2019 CA 001845. The District of
Columbia filed the receivership action to address certain hazardous
housing conditions which, according to the District, the Debtor
failed to abate. The Debtor's 50% co-owner Darioush Ashouripor has
disputed the District's allegations that the current condition of
the Property is solely the result of any neglect or indifference on
the part of the Debtor.
Nevertheless, in an effort to fully address the issues with respect
to the current condition of the Property, the Debtor has contracted
for the sale of the Property to a buyer with sufficient income and
expertise to adequately address the District's concerns with
respect to the current condition of the Property. Accordingly, the
Debtor has determined that it is in the best interests of the
residents as well as all creditors to sell the Property to an
independent third party at a price sufficient to satisfy all
financial obligations with respect to the Property.
The Sales Contract provides for the sale of the Property to the
Purchaser for $1.1 million. A purchase money deposit in the amount
of $30,000 has been paid to the title company, pending the closing
on the sale of the Property.
The Property is encumbered by a first priority lien held by Eagle
Bank in the current amount of approximately $763,000. The Debtor
estimates unsecured debt in the amount of approximately $64,500.
Accordingly, the proposed sale of the Property for $1.1 million
will enable the Debtor to pay its secured and unsecured creditors
in full.
The Property was appraised for the Debtor as of Dec. 16, 2014 by
Gregory R. Clucas, MAI, a certified real estate appraiser in the
District of Columbia, on behalf of Eagle Bank. As of that time,
the appraised valuations were as follows: (i) "As-Is" Market Value,
Dec. 17, 2014 - $720,000; (ii) "As Complete" Market Value, June 1,
2015 - $1.28 million; (iii) "As Stabilized" Market Value - Aug. 1,
2015 - $1.387 million.
The Property was purchased by the Debtor in January 2015 for
$727,000 with purchase money and construction loans from Eagle Bank
in the amount of $795,000, although the renovations necessary to
attain the "As-Complete" and "As Stabilized" values were never
fully completed. The Property was listed for sale from April 2019
to April 2020 at an asking price of $1.6 million. On April 28,
2020, Debtor received an offer to purchase the Property for
$1,025,000 and on May 12, 2020, the Debtor received the contract
offer for the purchase of the Property for $1.1 million. The Sales
Contract represents the highest and best offer the Debtor has
received for the sale of the Property.
The members of the Debtor are Mehrdad Valibeigi and Dan
Ashouripour, each of which owns a 50% interest in the Debtor. The
Astor is indebted to Dan Ashouripour for a loan in the amount of
$507,000. Upon the payment of all allowed secured and unsecured
claims, the claim of Dan Ashouripour will be paid to the extent of
the balance of any remaining sales proceeds.
A copy of the Contract is available at https://tinyurl.com/yatt2m4x
from PacerMonitor.com free of charge.
Counsel for Debtor:
Wendell W. Webster, Esq.
WEBSTER & FREDRICKSON, PLLC
1775 K Street, N.W.
Suite 290
Washington, D.C. 20006
Telephone: (202) 659-8510
Astor Partnership sought Chapter 11 protection (Bankr. D.D.C. Case
No. 20-00229) on May 19, 2020.
BOUNCE FOR FUN: Seeks Approval to Tap Rosen Systems as Auctioneer
-----------------------------------------------------------------
Bounce for Fun, LLC seeks approval from the U.S. Bankruptcy Court
for the Eastern District of Texas to employ Rosen Systems, Inc. as
auctioneer.
The Debtor desires to employ Rosen Systems to sell its assets by
auction.
The Debtor proposed to give Rosen Systems 10% buyer's premium on
all items sold plus reimbursement of its actual expenses from the
proceeds of the sale, subject to the approval of this Court.
Mike Rosen, a shareholder with Rosen Systems, Inc., disclosed in
court filings that the firm is a "disinterested person" within the
meaning of Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Mike Rosen
ROSEN SYSTEMS, INC.
2323 Langford St.
Dallas, TX 75208
Telephone: (972) 248-2266
(800) 527-5134
Facsimile: (972) 248-6887
About Bounce for Fun
Bounce for Fun, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
E.D. Tex. Case No. 20-41392) on June 17, 2020, disclosing under $1
million in both assets and liabilities. The Debtor is represented
by Eric A. Liepins, P.C.
BRISTOW GROUP: Moody's Hikes CFR to B2 & Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of Bristow Group
Inc., including its Corporate Family Rating to B2 from B3,
Probability of Default Rating to B2-PD from B3-PD, senior unsecured
notes rating to B3 from Caa1 and Speculative Grade Liquidity (SGL)
Rating to SGL-2 from SGL-3. The outlook was changed to stable.
These actions conclude the ratings review initiated on January 24,
2020, following the completion of the combination of Era Group Inc.
(Era) and Bristow, with the newly combined company using the
Bristow name. Legacy Bristow shareholders own 77% and legacy Era
shareholders own 23% of the equity of the combined company.
"The combination creates a company with global scale and
diversified operations, while significantly reducing Era's heavy
reliance on activity levels in the Gulf of Mexico," said Amol
Joshi, Moody's Vice President and Senior Credit Officer. "The
all-stock transaction did not increase combined debt balances, but
it still entails execution and integration risks while the company
is challenged by the protracted downturn in offshore oil & gas
activities, being exacerbated by low oil prices following the
coronavirus outbreak and deteriorating global economic outlook."
Upgrades:
Issuer: Bristow Group Inc.
Probability of Default Rating, Upgraded to B2-PD from B3-PD
Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3
Corporate Family Rating, Upgraded to B2 from B3
Senior Unsecured Notes, Upgraded to B3 (LGD5) from Caa1 (LGD5)
Outlook Actions:
Issuer: Bristow Group Inc.
Outlook, Changed to Stable from Rating Under Review
RATINGS RATIONALE
The upgrade to B2 reflects the combined company's enhanced size and
scale with a combined fleet of almost 300 helicopters, over 80% of
which are owned, and with significant operations throughout the
Americas, Nigeria, Norway, the UK and Australia. The all-stock
transaction did not add to debt balances, while potential
efficiencies and synergies should benefit credit metrics over
time.
The rapid spread of the coronavirus outbreak, deteriorating global
economic outlook, low oil prices, and high asset price volatility
have created an unprecedented credit shock across a range of
sectors and regions. Moody's regards the coronavirus outbreak as a
social risk under Moody's ESG framework, given the substantial
implications for public health and safety. The rating action
reflects the impact on Bristow of the deterioration in credit
quality it has triggered, given its exposure to the offshore oil
and gas sector, which has left it vulnerable to shifts in market
demand and sentiment in these unprecedented operating conditions.
Bristow's B2 CFR is supported by its global scale, leading market
position in the offshore helicopter services industry, long-term
search and rescue (SAR) contract with the UK government, large and
modern fleet of more than 80% owned aircraft and contractual
relationships with a diverse group of oil and gas customers. The
combination creates a company with significant presence in key
regions and meaningful end-market diversification through legacy
Bristow's UK SAR business. However, the company will continue to
face revenue and cash flow uncertainty due to the protracted
downturn in offshore oil and gas activities and weak demand from
its oil and gas industry customers, along with an oversupply of
helicopters.
Integrating the two companies' Gulf of Mexico operations should
result in material synergies and achieving operating efficiencies
should boost cash flow over time. However, integrating the two
companies' global assets and operations entails high execution
risk. It also significantly increases capital structure complexity
due to legacy Bristow's complex structure, and the company has
several debt maturities over the next few years. The combined
company is being run by legacy Era's CEO while the majority of its
eight-member board is comprised of legacy Bristow board members.
This could result in uncertainty regarding items such as corporate
strategy, leverage policy, capital allocation, along with the
inherent integration risks in a combination of this size with
global operations.
Bristow's SGL-2 Speculative Grade Liquidity Rating reflects good
liquidity. At June 12, the company had a cash balance of $267
million, and an undrawn $75 million ABL revolver ($23 million
available), with total liquidity of $290 million. The company
expects additional eligible receivables to increase the ABL's
borrowing base and provide more liquidity. The credit facility
matures in April 2023 and has a springing minimum fixed charge
coverage ratio covenant of 1x if ABL availability falls below a
certain threshold. The combined company will have a larger
helicopter fleet and should generate free cash flow due to modest
capital spending needs. While there are multiple debt tranches, the
nearest significant maturity is still more than two years away.
Legacy Era and Bristow have routinely sold unencumbered
helicopters, which provides an alternative source of liquidity.
The company's senior unsecured notes are rated B3, one notch below
the B2 CFR, despite the priority claim of its $75 million revolver
and other secured debt in the capital structure. The B3 rating for
the senior unsecured notes is believed to be more appropriate than
the rating suggested by Moody's Loss Given Default for
Speculative-Grade Companies Methodology because of the excess asset
coverage provided by Bristow's helicopter fleet.
The stable rating outlook reflects the combined company's ability
to generate free cash flow even as the offshore environment remains
stressed.
Bristow Group Inc., headquartered in Houston, Texas, is a leading
provider of helicopter transportation services to the oil and gas
industry worldwide.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The rating could be upgraded if the company's Debt to EBITDA is
sustained below 3x, cash flow grows in an improving oilfield
services environment, and the company funds growth mostly with
internal cash flow and asset sale proceeds while maintaining at
least adequate liquidity.
The rating could be downgraded if liquidity considerably weakens,
Debt to EBITDA rises above 4x or Bristow's financial policy
changes, such as using significant amounts of debt to accelerate
fleet upgrades or shareholder payouts.
The principal methodology used in these ratings was Global Oilfield
Services Industry Rating Methodology published in May 2017.
BROOKS BROTHERS: Case Summary & 30 Largest Unsecured Creditors
--------------------------------------------------------------
Lead Debtor: Brooks Brothers Group, Inc.
346 Madison Avenue
New York, NY 10017
Business Description: Brooks Brothers --
https://www.brooksbrothers.com --
is a clothing retailer with over
1,400 locations in over 45 countries.
While famous for its clothing offerings
and related retail services, Brooks
Brothers is known as a lifestyle brand
for men, women, and children, which
markets and sells footwear, eyewear,
bags, jewelry, watches, sports articles,
games, personal care items, tableware,
fragrances, bedding, linens, food items,
beverages, and more. Brooks Brothers
Group, Inc. is the Debtors' ultimate
corporate parent, which directly or
indirectly owns each of the other Debtor
entities.
Chapter 11 Petition Date: July 8, 2020
Court: United States Bankruptcy Court
District of Delaware
Thirteen affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Brooks Brothers Group, Inc. (Lead Debtor) 20-11785
Brooks Brothers Far East Limited 20-11786
696 White Plains Road, LLC 20-11787
BBD Holding 1, LLC 20-11788
BBD Holding 2, LLC 20-11789
BBDI, LLC 20-11790
Brooks Brothers International, LLC 20-11791
Brooks Brothers Restaurant, LLC 20-11792
Deconic Group LLC 20-11793
Golden Fleece Manufacturing Group, LLC 20-11794
RBA Wholesale, LLC 20-11795
Retail Brand Alliance Gift Card Services, LLC 20-11796
Retail Brand Alliance of Puerto Rico, Inc. 20-11797
Judge: Hon. Christopher S. Sontchi
Debtors' Counsel: Mark D. Collins, Esq.
Zachary I. Shapiro, Esq.
Brett M. Haywood, Esq.
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
920 N. King Street
Wilmington, Delaware 19801
Tel: (302) 651-7700
Fax: (302) 651-7701
E-mail: collins@rlf.com
shapiro@rlf.com
- and -
Garrett A. Fail, Esq.
David J. Cohen, Esq.
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, New York 10153
Tel: (212) 310-8000
Fax: (212) 310-8007
E-mail: garrett.fail@weil.com
davidj.cohen@weil.com
Debtors'
Investment
Banker: PJ SOLOMON, L.P.
1345 Avenue of the Americas
31st Floor
New York, New York 10105
Debtors'
Financial
Advisor: ANKURA CONSULTING GROUP LLC
485 Lexington Avenue, 10th Floor
New York, New York 10017
Debtors'
Claims,
Noticing &
Solicitation
Agent: PRIME CLERK, LLC
One Grand Central Place
60 East 42nd Street
Suite 1440
New York, NY 10165
https://cases.primeclerk.com/brooksbrothers/
Estimated Assets
(on a consolidated basis): $500 million to $1 billion
Estimated Liabilities
(on a consolidated basis): $500 million to $1 billion
The petitions were signed by Stephen Marotta, chief restructuring
officer.
A copy of Brooks Brothers Group's petition is available for free
at PacerMonitor.com at:
https://is.gd/v3GrRJ
List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Swiss Garments Company Trade Debt $5,232,180
Attn.: Alaa Arafa
Hala Hashem
3rd Industrial Area A1
Private Fee Zone
10th of Ramadan, Egypt
44634
Egypt
Tel: 20 100 123 4520
20 554 410 662
Email: aarafa@sgc.com.eg
hhashem@sgc.com.eg
2. FedEx ERS Trade Debt $2,944,203
Attn.: Paul Kruk
P.O. Box 371741
Pittsburgh, PA 15250‐7741
USA
Tel: (781) 296‐4303
Email: paul.kruk@fedex.com
3. Teacher's Insurance Lease $2,857,718
Attn: Richard Lee Obligation
210 Post St., Suite 316
TIAA #6910
San Francisco, CA 94108
USA
Tel: 415‐781‐885
Email: richard.lee@cushwake.com
4. Trajes Mexicanos S.A. De C.V. Trade Debt $2,843,652
Attn.: Mario Sanchez Llono
Isidro Fabela #102
Parque Industrial Tianguistenco
Tianguistenco, Mexico
52600
Mexico
Tel: 52 713 133 66 66
Email: mario@tramex.com.mx
5. Esquel Enterprises Limited Trade Debt $2,550,522
Attn.: Wesley Choi/Eveline Lau
13/F Harbour Centre
25 Harbour Road
Wanchai, Hong Kong
999077
Hong Kong
Tel: 852 2960 6642
852 2960 6617
Email: choiw@esquel.com
laue@esquel.com
6. Pt Unagaran Sari Garments Trade Debt $1,964,208
Attn.: Sanjay Goyal
JL P Diponegoro No. 235 Genuk,
Ungaran Barat
Kabupaten Semarang, Indonesia
50512
Indonesia
Tel: 62 24 6921113
Email: sgoyal@busanagroup.com
7. Grosvenor Urban Retail, LP Lease $1,190,092
Attn.: David Sidorsky Obligation
Division #23
5500 Wisconsin
P.O. Box 823523
Grosvenor‐5500WISC
Philadelphia, PA 19182‐3523
USA
Tel: (202) 851‐5600
Email: dsidorsky@plc.com
8. T.U.W. Textile Co., Ltd. Trade Debt $1,187,122
Attn.: Masayuki Shimakura
113 MOO4, Nakornchaisr‐Dontoom‐
Roda
Sampatuan, Nakornchaisri
Nakornprathom, Thailand
73210
Thailand
Tel: 66 3438 9571
Email: mshima@tuw.co.th
9. Adventura Mall Venture Lease $1,109,291
Attn.: Jory Thomas Obligation
P.O. Box 865006
Orlando, FL 32886
USA
Tel: (305) 914‐8215
Email: jthomas@turnberry.com
10. Epic Designers Limited Trade Debt $1,067,233
Attn.: Gilles Fries
Floor 6, 7, & 9th EGL Tower No. 83
Hung to Road
Kwun Tong Kowloon, Hong Kong
99700
Hong Kong
Tel: 852 3512 0800
Email: gilles.fries@epichk.com
11. Winner Way Industrial Limited Trade Debt $969,995
Attn.: Sing Li
Units A‐C, 21/F, Block 1
Tai Ping Industrial Centre
57 Ting Kok Road
Tai Po, N.T. Hong Kong,
99977
Hong Kong
Tel: 852 2689 1881
Email: singl@nameson.com.cn
12. Yee Tung Garment Company Limited Trade Debt $968,004
Attn.: Victor Fong
3/F Chiap Luen Industrial Bldg.
30‐32 Kung Yip Street
Kwai Chung, N.T., Hong Kong
999077
Hong Kong
Tel: 852 2211 0100
Email: victor@yeetung.com
13. Pt Eratex Djaja Tbk Trade Debt $957,134
Attn.: Sanjay Goyal
JL. Soekarno Hatta 23
Probolinggo
67212
Indonesia
Tel: 62 24 6921113
Email: sgoyal@busanagroup.com
14. Di. Conf. SRL Trade Debt $925,752
Attn.: Rosario Parlato
Via Variante 7 BIX KM 45.300
Margianella, Italy
80030
Italy
Tel: 39 081 841 1762
Email: r.parlato@diconf.com
15. Excellent Jade Limited Trade Debt $908,147
Attn.: Vivian Chan
5/F., 66‐72 Lei Muk Road
Kwai Chung, N.T., Hong Kong
999077
Hong Kong
Tel: 852 2279 3808
Email: vivianchan@tristateww.com
16. Winston & Strawn Professional $871,449
Attn.: Jonathan Birenbaum Services
36235 Treasury Center
Chicago, IL 60694‐6200
USA
Tel: (212) 294‐4629
Email: jbirenbaum@winston.com
17. Salesforce.Com, Inc. Technology $855,119
Attn.: Brett Murray Services
P.O. Box 203141
Dallas, TX 75320‐3141
USA
Tel: (317) 832‐4087
Email: brett.murray@saleforce.com
18. Bagir International, Inc. Trade Debt $832,473
Attn.: Micha Ronen
Asaf Shavit‐Stricks
499 Fashion Avenue, 16 S
New York, NY 10018
USA
Tel: 972 52 277 1702
972 3 6254000
Email: michar@bagir.com
asafs@zadokco.co.il
19. Kleban Darien LLC Lease $793,603
Attn.: April Clyne Obligation
1189 Post Road
Fairfield, CT 06824
USA
Tel: (203) 955‐1978
Email: aclyne@klebanproperties.com
20. Calvelex, S.A. Trade Debt $791,969
Attn.: Marco Araujio
Monte Do Calvelo
E.N. 106 NR. 1132
Lousada
4620‐249
Portugal
Tel: 351 255 880321
Email: marco.araujo@calvelx.com
21. Georgetown Renaissance, LP Lease $767,134
Attn.: Will Hitchcock Obligation
P.O. Box 822475
Philadelphia, PA 19182‐2475
USA
Tel: (202) 688‐3994
Email: whitchcock@eastblanc.com
22. Borderfree Technology $758,945
Attn.: Hansel Tan Services
292 Madison Avenue, 5th Floor
New York, NY 10017
USA
Tel: (917) 943‐2455
Email: hanselkimwell.tan@pb.com
23. Pespow S.P.A. Trade Debt $724,436
Attn.: Cinzia D'Agositino
Via Dell'Industria 23
S Martino Di Lupari
Padova, Italy 35018
Italy
Tel: 39 049 5950 214
Email: cinzia.dagostino@pespow.com
24. KPMG Professional $683,067
Attn: Victoria Youkhateh Services
P.O. Box 120511
Dept. 0511
Dallas, TX 75312‐0511
USA
Tel: (860) 297‐5060
Email: vyoukhateh@kpmg.com
25. Tyson's Corner Holdings, LLC Lease $658,258
Attn: Saratina Martin Obligation
P.O. Box 849554
Los Angeles, CA 90084‐9554
USA
Tel: (424) 229‐3709
Email: saratina.martin@macerich.com
26. RCPI Landmark Properties, LLC Lease $621,435
C/O Tishman Speyer Properties Obligation
Attn: Vinnie Cirillo
P.O. Box 33173
Newark, NJ 07188‐3173
USA
Tel: (212) 332‐6637
Email: vcirillo@tishmanspeyer.com
27. MD Contract SRL Trade Debt $605,542
Attn.: Paolo Filippo Soldan
Galleria Del Corso 2
Milano, MI 20122
Italy
Tel: 39 3428796763
Email: mdcontract@pec.it
28. Amalgamated National Insurance $591,080
Attn: Timothy Clark Provider
333 Westchester Ave.
White Plains, NY 10604
USA
Tel: (914) 367‐5841
Email: tclark@alicare.com
29. Manhattan Associates Trade Debt $577,233
Attn.: Dennis Story
P.O. Box 405696
Atlanta, GA 30384‐5696
USA
Tel: (770) 955‐7070
Email: ar.manh.com
30. Universal Express (Garments) Ltd. Technology $564,164
Attn.: Gene Choi Services
Room 2402, 24/F, Sing Pao Bldg.
101 Kings Road, Fortress Hill
Hong Kong, Hong Kong
99970
Hong Kong
Tel: 86 21 6272 5058
Email: jkchoi@sh‐universal.com
CACI INTERNATIONAL: Moody's Raises CFR to Ba1, Outlook Stable
-------------------------------------------------------------
Moody's Investors Service upgraded most of its ratings for CACI
International, Inc., including the company's corporate family
rating (to Ba1, from Ba2) and probability of default rating (to
Ba1-PD, from Ba2-PD), and the ratings for the company's senior
secured first lien debt (to Ba1, from Ba2). The company's SGL-2
speculative grade liquidity rating remains unchanged, and the
ratings outlook is stable.
According to lead analyst Bruce Herskovics, "CACI's record of good
contract execution, coupled with the application of free cash flow
towards M&A over many years, has expanded its addressable market
well beyond Army operational support and given it access to more
complex/higher technology programs, enhancing the company's
resilience and importance as a defense services contractor."
Regarding the stable ratings outlook, Herskovics said that "We
expect that CACI will be an active acquiror as defense services
market consolidation continues over the next few years, and debt
will subsequently rise, but we also anticipate that the company's
key credit metrics will remain well within a supportive range of
the higher ratings, with equity augmenting debt as needed to fund
prospective transactions in a fiscally prudent manner that would
otherwise take leverage above the mid 4x range."
Notwithstanding the ratings upgrades, the rapid spread of the
coronavirus outbreak, a deteriorating global economic outlook, low
oil prices and high asset price volatility have created an
unprecedented credit shock across a range of sectors and regions.
Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety. Even with the upgrades, the actions reflect the impact
on CACI of the modest deterioration in credit quality it has
triggered given its exposure to defense services contracting, which
while less affected than most other sectors has not been immune to
the adverse impact of the pandemic and leaves the company
vulnerable to shifts in market demand and sentiment in these
unprecedented operating conditions.
Upgrades:
Issuer: CACI International, Inc.
Corporate Family Rating, Upgraded to Ba1 from Ba2
Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD
Gtd. Senior Secured Term Loan A, Upgraded to Ba1 (LGD3) from
Ba2 (LGD3)
Gtd. Senior Secured 1st Lien Revolving Credit Facility,
Upgraded to Ba1 (LGD3) from Ba2 (LGD3)
Outlook Actions:
Issuer: CACI International, Inc.
Outlook, Remains Stable
RATINGS RATIONALE
The Ba1 CFR broadly reflects the $6 billion revenue base
anticipated for CACI in FY20, with a backlog of $20 billion, good
credit metrics for the rating and a bid pipeline that increasingly
features a diverse range of contracts/tasks -- national security
related service offerings including engineering services,
logistics, IT modernization, tactical communications and other
field technologies. Moody's expects leverage between the 3x to
mid-4x range, with CACI continuing to fully retain its earnings and
free cash flow at about 15%-20% of debt.
The rating also acknowledges CACI's adaptability in shaping the
business portfolio as defense priorities change, which makes the
company a more valuable contractor to the US Department of
Defense.
CACI possesses low contract concentration but revenues are mainly
from the US defense/intelligence communities, comprising about 70%,
which elevates the risk from changed government spending levels or
priorities. Moody's anticipates that CACI's M&A activity will
remain focused on the US national security market.
The speculative grade liquidity rating continues at SGL-2, denoting
a good liquidity profile helped by near-term free cash flow
generation of $350 million, well in excess of scheduled term loan
amortization and with only mild seasonality. Availability under the
company's $1.5 billion revolving credit line was $835 million at
March 30, 2020, a good amount for the company's size. CACI fully
utilizes its short-term $200 million accounts receivable
securitization line, which notably expires in December, and working
capital would expand commensurately if the line is not renewed. The
credit facility features two financial maintenance tests under
which headroom is expected to remain good.
The senior secured credit facility ratings are Ba1, on par with the
corporate family rating. The facility constitutes all of CACI's
debt.
The ratings outlook is stable, reflecting the good free cash flow
characteristics of the business and the discipline CACI has
historically evidenced toward acquisition valuation multiples paid
and subsequent deleveraging. Moody's expects that CACI will be an
active acquirer in the coming years, and the company's addition of
greater specialization and higher technology in recent years will
raise R&D spending and bring it more directly into competition with
innovative defense contractors that possess deep technology
franchises. The outlook also considers that CACI consistently holds
low cash balances, and can sometimes possess adequate but
relatively thin liquidity for its size, with heavy revolver draws
for acquisition financing.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Upward ratings momentum would depend on the company's continued
evolution in terms of revenue scale and capability as a defense
contractor, with leverage sustained in the 3-4x range and free cash
flow-to-debt continuing at around 20%. Confidence of a sustained
good liquidity profile with cash maintained at $350 million would
be important to upward ratings movement.
Downward ratings pressure would mount with evidence of material
market share erosion, contract execution problems, leverage
continuing above the mid-4x level, or total liquidity of less than
$300 million.
CACI International Inc, based in Arlington, Virginia, provides
information technology ("IT") services and solutions for the US
Department of Defense (DoD), federal civilian agencies, and the
Government of the United Kingdom. Revenues for the last twelve
months ended March 31, 2020 were $5.6 billion.
The principal methodology used in these ratings was Aerospace and
Defense Methodology published in July 2020.
CAPSTONE OILFIELD: Seeks Approval to Tap PPL Group as Auctioneer
----------------------------------------------------------------
Capstone Oilfield Disposal Services, LLC seeks approval from the
U.S. Bankruptcy Court for the Western District of Oklahoma to
employ PPL Group, LLC as auctioneer.
The Debtor desires to employ PPL Group for the purpose of
liquidating its assets, 10 salt-water disposal wells and related
equipment.
PPL Group will receive a commission of 2.5%, charge a buyer's
premium of 10% for onsite sales and 13% for online sales and be
reimbursed for certain expenses, subject to the approval of this
Court.
PPL Group, LLC is a "disinterested person" within the meaning of
Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
PPL GROUP, LLC
105 Revere Drive, Suite C
Northbrook, IL 60062
Telephone: (224) 927-5300
About Capstone Oilfield Disposal Services
Capstone Oilfield Disposal Services, LLC, sought Chapter 11
protection (Bankr. W.D. Okla. Case No. 20-10461) on Feb. 14, 2020.
In the petition signed by Randy Holder, owner/managing member, the
Debtor disclosed total assets at $10.06 million and $14.16 million
in debt. The Debtor tapped Stephen J. Moriarty, Esq., at Fellers,
Snider et al., as counsel.
CARLSON TRAVEL: Fitch Lowers Issuer Default Rating to C
-------------------------------------------------------
Fitch Ratings has downgraded Carlson Travel, Inc.'s Issuer Default
Rating to 'C' from 'B' following the company's announcement of an
offer to exchange its series of senior secured notes and senior
unsecured notes for new notes with extended maturities. The
downgrade results from Fitch viewing the transaction as a
distressed debt exchange. Per Fitch's criteria, the IDR will be
downgraded to Restricted Default upon the completion of the DDE.
The IDR will subsequently be re-rated to reflect the post-DDE
credit profile. Fitch also downgraded CWT's senior secured debt to
'CCC/RR1' from 'BB/RR1' and CWT's senior unsecured debt to 'C/RR4'
from 'B/RR4'. There is no Rating Outlook.
The transaction contemplates a tender offer to exchange the USD415
million 6.75% secured notes due 2023 and EUR330 million floating
rate secured notes due 2023 with substantially similar issuances
but maturing in 2025. It also contemplates a tender offer to
exchange the USD250 million 9.5% unsecured notes due 2024 with a
substantially similar issuance but maturing in 2026. CWT's
revolving credit facility lenders are also party to the
restructuring support agreement, subject to credit approval, which
includes extending the facility's maturity date to September 2024
and temporarily waiving the minimum EBITDA financial covenant.
As part of the RSA, CWT's principal shareholder (Carlson, Inc.)
will invest an additional $125 million in equity into CWT and CWT
will issue $125 million of new senior secured notes that are
backstopped by a subgroup of existing noteholders. Upon completion
of the DDE, Fitch will assign ratings to the exchanged notes and
new secured notes.
KEY RATING DRIVERS
Exchange Adds Liquidity & Runway: The $250 million in incremental
liquidity will further enhance CWT's ability to withstand the
severe near-term operating shock. The company has already taken
proactive steps to reduce cash operating expenses by $320 million
and is experiencing neutral-to-slightly positive working capital
dynamics. While there were no immediate refinancing concerns, the
exchange provides additional runway for travel volumes to recover
before CWT needs to address any maturities.
The second calendar quarter will see the greatest cash burn given
the sharp expected reductions in travel transactions and roughly
$30 million in cash interest expense (paid June 15). Working
capital changes for the remainder of 2020 should not materially
impact the cash burn rate given that CWT does not employ the
merchant model, unlike peer Expedia Group, Inc. (BBB-/Negative).
Solid Diversification: CWT is well-diversified from a geographic,
customer and contract type perspective, helping to moderate an
impact from cyclical travel pressures. A majority of revenue is
generated in the Americas and EMEA, with a growing presence in
Asia. No single customer comprises a meaningful portion of total
revenue and CWT's business clients are also diversified across
industries. The company structures its contracts as either
transaction fee-based (roughly two-thirds of revenue) or management
fee-based, with the latter supporting cash flows in the event of
travel volume declines.
Long-Term Margin Improvement: EBITDA margins have expanded since
2017 and will continue to improve toward the high teens through the
recovery, primarily from improvements in cost structure related to
reduced labor costs and more efficient operating model. Over the
medium term, headcount is being centralized at global service
centers in lower cost geographies and investments in technology and
systems are reducing absolute costs.
CWT will also benefit from margin yield improvement (how much
revenue is generated per travel booking) as its RoomIt hotel
distribution business grows. CWT continues to add new hotel
properties to its platform with negotiated rates and Fitch expects
hotel attachment rate (hotel bookings as percentage of airline
bookings) to modestly increase, which will also boost margins.
These initiatives will be counterbalanced by an overall mix
increase in lower margin yield online bookings.
Agile Operating Model: A majority of CWT's operating costs are
staff, which it monitors regularly and can adjust quickly to
changes in travel volumes - including potentially lingering effects
on global travel from the evolving coronavirus outbreak. In 2009,
CWT was able to cut roughly 17% of its workforce, while revenue and
EBITDA declined by slightly less (on constant currency basis). This
resulted in low flow-through to EBITDA and only modest pressure on
margins. A number of other operating costs are variable, including
fees to credit card companies, OTAs and suppliers. Certain capex
spending related to software development could also be delayed
during periods of stress.
Business Travel Industry: Fitch expects business travel volumes to
return to pre-COVID levels around 2024, which is similar to Fitch's
recovery time frame for leisure travel. However, in the near-term
Fitch anticipates business travel to rebound at a slower pace due
to companies' potentially reduced willingness to allow employees to
travel and cancellation or rescheduling of group events.
Traditionally, the business travel industry has a moderate degree
of cyclicality, due to demand volatility stemming from economic
cycles or external shocks. The business travel industry is
fragmented, with many companies still retaining operations
in-house, though CWT is one of the largest competitors along with
American Express Global Business Travel.
DERIVATION SUMMARY
CWT is a global operator in business travel management services
with historically moderate leverage. The closest Fitch-rated public
peer is Expedia Inc. (BBB-/Negative), which provides
business-to-consumer travel services primarily to individuals and
is more exposed to leisure travel. Expedia has significantly larger
scale, which had excess of $100 billion gross travel bookings and
$1 billion in annual FCF during 2019, while it also has a
long-established track record of adhering to a below 2.0x gross
debt/EBITDA target. Travelport and Sabre GLBL are also peers that
operate in the global distribution system business. Travelport has
historically operated with slightly higher leverage than CWT, while
Sabre lower leverage and higher EBITDA and FCF margins. Long term,
Fitch feels the disintermediation risk of GDS companies from the
travel funnel is greater than business travel management companies,
with the latter offering high value-add services to corporate
clients.
KEY ASSUMPTIONS
-- Significant revenue declines in 2020 as a result of the
coronavirus' disruption to global travel. Fitch assumes aggregate
revenue declines roughly 55% in 2020, with quarterly revenue
declines ranging from 40%-80%. Fitch assumes a moderate recovery in
travel demand beginning in 2021, with revenues in 2021 roughly 20%
below 2019 levels.
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that CWT would be reorganized as a
going-concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim, and has assumed the $150
million revolver to be fully drawn at the time of recovery.
Fitch estimates going-concern EBITDA in a scenario in which default
may be caused by deep cyclical pressures, resulting in prolonged
cash burn. Under this scenario, Fitch estimates a going-concern
EBITDA of roughly $190 million, which is also in-line with forecast
EBITDA two years forward from the 2020 trough level. This decline
in EBITDA from the December 2019 peak is slightly worse than CWT's
performance during the last recession. Fitch assumes a
going-concern recovery multiple of 6.0x for CWT. This is slightly
above Travelport's 5.0x recovery multiple assumed by Fitch, as the
agency feels that the long-term disintermediation risk is lower for
travel management companies compared with GDS companies. There are
limited public transaction multiples in the travel services
industry, though CWT's recovery multiple is lower than acquisition
multiples for Travelport in 2018 (11.0x) and Orbtiz Worldwide in
2015 (10.3x).
Fitch forecasts a post-reorganization enterprise value of roughly
$1.0 billion, after the deduction of expected administrative claims
of 10%. This results in a 91% - 100% recovery band for the senior
secured revolver and notes, which equates to +3 notching from the
IDR to 'CCC'/'RR1'. The senior unsecured notes recovery results in
a 31%-50% band, notched on par with the IDR at 'C'/'RR4'. Given the
planned issuance of $125 million in new senior secured debt, Fitch
anticipates the new exchanged unsecured notes to have a lower
recovery rating than the existing unsecured notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
Per Fitch's criteria, CWT's IDR will be downgraded to Restricted
Default upon the completion of the debt exchange. The IDR will
subsequently be re-rated to reflect the post-DDE credit profile.
Fitch currently expects the re-rated post-exchange IDR to be no
higher than 'B' given CWT's challenging operating environment and
the potential for a prolonged disruption to business travel
relative to leisure travel.
Relative to the prior 'B' IDR, factors that would support a
positive rating action:
-- Evidence of a stabilization in travel demand and signs of a
significant rebound in global travel demand;
-- Gross debt/EBITDA sustaining below 5.0x;
-- Greater aggregate liquidity to withstand a prolonged period of
disrupted global travel demand, potentially from incremental
facility capacity or owner support.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A post DDE IDR that is lower than the previous 'B' rating
would reflect an expectation that the company's gross debt/EBITDA
will sustain above 6.0x by 2022 and/or its improved liquidity
profile (pro forma for the transactions) is eroded as a result of a
prolonged disruption to global travel.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Liquidity Boost: The incremental $250 million in liquidity is
viewed positively in the context of a prolonged disruption to
global travel from the coronavirus pandemic. As a result of the
transactions, liquidity is not a major concern in Fitch's forecast
for a gradual recovery in global travel demand by 2024. While CWT
did not have any meaningful near-term maturities, the transaction
provides for additional runway for EBITDA improvement before any
refinancings need to be contemplated. Paydown of the $113 million
drawn on the revolver from transaction proceeds would be viewed
neutrally.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch adds back exceptional and one-time items to EBITDA,
specifically for severance related to its relocation of labor to
global service centers. Fitch also adds and subtracts distributions
to and from affiliates to EBITDA.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of 3 - ESG issues are credit
neutral or have only a minimal credit impact on the entity, either
due to their nature or the way in which they are being managed by
the entity.
CENTRAL PALM: Committee Taps Brinkman Portillo as Legal Counsel
---------------------------------------------------------------
Zach Noling, authorized representative of the Committee of
Creditors Holding Unsecured Claims appointed to the Chapter 11
cases of Debtors Central Palm Beach Surgery Center Ltd. and CPBS
Management LLC, seeks approval from the U.S. Bankruptcy Court for
the Southern District of Florida to employ the law firm of Brinkman
Portillo Ronk, APC as the Committee's attorney.
The professional services the attorney will render are summarized
as follows:
(a) give advice to the Committee with respect to its powers
and duties as a Committee;
(b) advise the Committee with respect to the preparation of
motions, pleadings, orders, applications, adversary proceedings,
and other legal documents necessary in the administration of the
case;
(c) protect the interest of the Committee and other
similarly-situated unsecured creditors in all matters pending
before the court; and
(d) represent the Committee in negotiation with the Debtors
and other creditors in the preparation of a plan if necessary.
The law firm intends to charge its normal hourly rates, which are
the same as its rates charged for non-bankruptcy matters, subject
to the approval of this Court.
To the best of the Committee's knowledge, Brinkman Portillo Ronk,
APC has no connection with the Debtors, other creditors or other
parties-in-interest or their respective attorneys and disinterested
as required by Section 327(a) of the Bankruptcy Code.
The firm can be reached through:
David L. Merrill, Esq.
BRINKMAN PORTILLO RONK, APC
Harbour Financial Center
2401 PGA Boulevard, Suite 280M
Palm Beach Gardens, FL 33410
Telephone: (561) 877-1111
E-mail: dlmerrill@theassociates.com
About Central Palm Beach Surgery Center
Central Palm Beach Surgery Center Ltd. and CPBS Management LLC,
owners of an ambulatory surgery center in West Palm Beach, Fla.,
filed voluntary petitions under Chapter 11 of the Bankruptcy Code
(Bankr. S.D. Fla. Lead Case No. 20-11127) on Jan. 28, 2020. The
petitions were signed by Jonathan Cutler, authorized member. At the
time of the filing, Central Palm disclosed $7,115,518 in assets and
$12,270,801 in liabilities.
Judge Mindy A. Mora oversees the cases.
The Debtors tapped Robert C. Furr, Esq., at Furr & Cohen, P.A., as
legal counsel and Julie B. Hershman and the accounting firm of
Julie B. Hershman, CPA, PA as accountants.
The Committee of Creditors Holding Unsecured Claims tapped Brinkman
Portillo Ronk, APC as its attorney.
CHEETAH RENTALS: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
The Office of the U.S. Trustee on July 7 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of Cheetah Rentals, LLC.
About Cheetah Rentals
Cheetah Rentals, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Texas Case No. 20-50061) on June 1,
2020. At the time of the filing, Debtor disclosed $100,236 in
assets and $1.5 million in liabilities. Judge David R. Jones
oversees the case. Debtor has tapped the Law Office of Clint W.
Chase.
CHISHOLM OIL: Mesa Natural Gas Removed as Committee Member
----------------------------------------------------------
The U.S. Trustee for Region 3 disclosed in a notice filed with the
U.S. Bankruptcy Court for the District of Delaware that as of July
8, these creditors are the members of the official committee of
unsecured creditors appointed in the Chapter 11 cases of Chisholm
Oil and Gas Operating, LLC and its affiliates:
1. Alta Mesa Services, LP
Attn: Loretta Cross
2101 Cedar Springs RD, Ste. 1100
Dallas, TX 75201
Phone: 713-302-5681
Email: lcross@stout.com
2. Reliance Oilfield Services, LLC
Attn: Heath Casey
Two West 2nd St., Ste. 1350
Tulsa, OK 74103
Phone: 918-392-9225
Email: Heath.Casey@RelianceOFS.com
Mesa Natural Gas Solutions, LLC's name did not appear in the
notice. The company was appointed as committee member on July 1,
court filings show.
About Chisholm Oil and Gas Operating
Chisholm Oil and Gas Operating, LLC is an exploration and
production company focused on acquiring, developing, and producing
oil and natural gas assets in the Anarkado Basin in Oklahoma in an
area commonly referred to as the Sooner Trend Anadarko Basin
Canadian and Kingfisher County.
Chisholm Oil and Gas Operating and its affiliates sought Chapter 11
protection (Bankr. Lead Case No. 20-11593) on June 17, 2020.
In the petition signed by CFO Michael Rigg, the Debtors were
estimated to have $1 billion to $10 billion in assets and $500
million to $1 billion in liabilities.
The Hon. Brendan Linehan Shannon presides over the cases.
The Debtors have tapped Weil, Gotshal & Manges, LLP and Young
Conaway Stargatt & Taylor, LLP as legal counsel; Evercore Group,
LLC as investment banker; Alvarez & Marsal North America, LLC as
financial advisor; and Omni Agent Solutions as claims and noticing
agent.
CLEVELAND-CLIFFS INC: Fitch Assigns B LT IDR, Outlook Negative
--------------------------------------------------------------
Fitch Ratings has assigned Cleveland-Cliffs, Inc. a Long-Term
Issuer Default Rating of 'B'. Fitch also assigned the company's
subsidiary, AK Steel Corporation, a Long-Term IDR of 'B'. In
addition, Fitch has assigned 'BB'/'RR1' ratings to CLF's ABL credit
facility, CLF's first-lien secured notes and AK Steel's first-lien
secured notes; a 'B-'/'RR5' rating to CLF's guaranteed unsecured
notes; and 'CCC+'/'RR6' ratings to the unsecured convertible notes,
the CLF unsecured notes not benefitting from guarantees and the AK
Steel unsecured guaranteed notes. The Rating Outlook is Negative.
CLF's ratings reflect its vertical integrated operating profile
with a leading position in iron ore in the U.S., with assets
located in the Great Lakes region providing a competitive
advantage, its focus on higher value-added steel production and its
electric arc furnace (EAF)-focused, Toledo, OH hot briquetted iron
facility. Fitch believes CLF's multiyear, volume-linked contract
with ArcelorMittal S.A. (BB+/Negative) and its internal
requirements provide a stable source of iron ore demand. CLF's
ratings also reflect AK Steel's focus on higher value-added steels,
which have higher barriers to entry, fixed-price contracts, premium
pricing and are less susceptible to imports.
Rating concerns include CLF's high exposure to the automotive
market, which Fitch expects to be negatively impacted by the
coronavirus pandemic in 2020, resulting in significantly lower
shipments. Fitch does not anticipate steel shipments recovering to
2019 levels until 2022. Fitch expects total debt/EBITDA to be
significantly elevated in 2020 but to trend lower over the ratings
horizon as the economy and steel fundamentals recover. Fitch
forecasts CLF to have adequate liquidity and the company has no
material maturities until 2024. However, Fitch views this as
partially offset by expectations for significantly lower EBITDA in
2020 and high interest and pension expenses.
The Negative Outlook reflects the uncertain ultimate impact of the
coronavirus pandemic on the economy, potentially leading to a
weaker than expected liquidity profile and leverage metrics
sustained above 'B' rating tolerances. Fitch believes if challenged
market conditions persist, CLF's ABL borrowing base could be lower
than the roughly $1.8 billion borrowing base as of March 31, 2020
with limited additional secured debt capacity. Fitch views
potentially weaker liquidity as partially offset by scant debt
maturities until 2024. Fitch could stabilize the Outlook with more
visibility into an economic recovery and rebound in auto demand.
KEY RATING DRIVERS
AK Steel Merger: On March 13, 2020, CLF consummated a merger with
its second-largest iron ore pellet customer AK Steel, where AK
Steel became a wholly owned subsidiary of CLF. In 1Q20, CLF's debt
outstanding increased by approximately $2.24 billion and, as part
of the merger, CLF assumed significant pension obligations of AK
Steel. However, on a normalized basis, Fitch would view the
transaction as relatively leverage-neutral with additional earnings
offsetting the increase in debt. The transaction created an
integrated steel producer that is more than 100% self-sufficient in
iron ore, resulting in the ability to continue to make third-party
iron ore pellet shipments. Fitch views the transaction positively,
as it expands CLF's customer base, provides a captive source of
demand for a portion of its iron ore and creates the opportunity
for synergies.
High Exposure to Auto: Approximately 66% of AK Steel's 2019 sales
were to the automotive market, resulting in CLF being highly
exposed to auto demand. Fitch believes auto demand will decline
significantly in 2020 resulting in significantly lower EBITDA
generation. Additionally, the timing and magnitude of a recovery in
demand remains uncertain, leading to the possibility that EBITDA
may be depressed beyond 2020.
However, AK Steel is one of a few North American steel producers
capable of producing some of the most sophisticated grades of
advanced high-strength steels and value-added stainless-steel
products, and the only producer of non-oriented electrical steel, a
critical component of hybrid/electric vehicles' motors.
Longer-term, AK Steel produces steel grades critical to automotive
light weighting steel trends and is well-positioned to benefit from
an auto recovery, as well as the transition to electric cars. Fitch
views positively AK Steel's strategy of focusing on higher
value-added steels, which have higher barriers to entry,
fixed-price contracts, premium pricing and are less susceptible to
imports. Additionally, approximately 70% of AK Steel's 2019 sales
were under fixed-price contracts, typically one year in length,
lowering its exposure to volatile steel prices.
Coronavirus Pandemic's Impact: In response to the coronavirus
pandemic's impact on market conditions, CLF announced in 2Q20 the
temporary idling of its Northshore and Tilden iron ore mining
operations and that it expects Northshore to restart in July 2020,
with Tilden restarting in June 2020. Additionally, the Hibbing
mine, in which CLF is a 23% minority participant, has been idled by
the joint venture. In response to faster than initially anticipated
demand from the automotive sector, Precision Partners, Mansfield
Works and Dearborn downstream facilities restarted in late-2Q20
after being temporarily idled.
Liquidity/Debt Maturity Profile: As of March 31, 2020, CLF had cash
and cash equivalents of $187 million and $790 million available
under its $2 billion ABL credit facility due 2025. In 2Q20, CLF
issued $1.075 billion in secured notes, of which, $736 million was
used to reduce previously outstanding debt and $120 million is
intended to be used to finance the construction of its HBI
production plant, resulting in $218 million of additional
liquidity. As a result of the coronavirus pandemic's impact on
operations, CLF announced it plans to suspend future dividends and
has the ability to defer capex by approximately $200 million. Fitch
views the marginal increase in debt as offset by improved liquidity
to weather a period of weak demand. Fitch believes CLF will use
excess cash to reduce borrowings under its ABL credit facility as
market conditions improve.
Vertically Integrated Business Model: CLF's merger with AK Steel
created a vertically integrated steel producer self-sufficient in
iron ore, which Fitch expects to improve steel margins and provide
the opportunity for synergies. The location of CLF's iron ore mine
in the Great Lakes region provides a competitive advantage for iron
ore pellet sales to blast furnace facilities located in close
proximity. CLF also has a long-term agreement with ArcelorMittal to
sell and deliver a proportion of its iron ore pellet consumption
requirements, which, in addition to its internal requirements,
provides a stable source of demand.
HBI Strategy: EAF steel producers have been taking market share
from blast furnace producers in the U.S. As EAF steel producers
expand into higher value-added steel products, they will require
higher-quality, iron ore-based metallic, such as HBI, to produce
higher quality steel. CLF's strategy is to become a critical
supplier of HBI to EAFs and, as part of that strategy, has begun
construction on its Toledo HBI plant. CLF expects to spend
approximately $1 billion to construct its HBI construction plant,
of which, $800 million has been spent as of March 31, 2020.
Construction of the HBI plant is expected to be completed in 4Q20,
and once fully operational, is expected to have annual capacity of
1.9 million tonnes. HBI can also be used internally by AK Steel's
blast furnaces to improve productivity.
Strong Operational Ties: Fitch equalized the IDRs of CLF and AK
Steel given the vertical integration between the entities, which
results in strong operational and strategic ties. Fitch believes AK
Steel will continue to account for a meaningful portion of CLF's
iron ore production. Fitch views CLF's financial performance as
linked to AK Steel's, as the steel and manufacturing segment will
account for the majority of sales of the combined company. In
addition, certain of the CLF notes benefit from guarantees from AK
Steel and some subsidiaries providing legal ties between the
entities. Fitch believes additional borrowing will be at the CLF
level and expects the remaining AK Steel debt to be redeemed.
DERIVATION SUMMARY
CLF is comparable with EAF long steel producer Commercial Metals
Company (BB+/Stable) in terms of annual steel shipments, although
has less favorable credit metrics. CLF is smaller and less
diversified compared with integrated steel producer United States
Steel Corporation (B-/Negative) and globally diversified steel
producer ArcelorMittal S.A. (BB+/Negative). CLF is smaller in terms
of annual shipments and has less favorable credit metrics compared
with EAF producer Steel Dynamics, Inc. (BBB/Stable).
KEY ASSUMPTIONS
Fitch's Key Assumptions Within the Rating Case for the Issuer:
-- Steel shipments decline significantly in 2020, recover in
2021 and return to historical levels in 2022;
-- Iron ore sales average roughly 13 million tonnes in 2020 and
2021 and roughly 15 million tonnes thereafter;
-- Capex slightly elevated in 2020 for the construction of the
HBI facility and then moderating to approximately $250-$300
million per year through the ratings horizon;
-- No dividends in 2020 after 1Q20, dividend reinstated in 2021;
-- No acquisitions or share repurchases through the ratings
horizon.
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that CLF would be reorganized as a
going-concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim and assumed the ABL credit
facility is 80% drawn in the recovery analysis.
GC Approach:
Fitch has assumed a bankruptcy scenario exit GC EBITDA of $900
million. The GC EBITDA estimate is reflective of a midcycle
sustainable EBITDA level upon which Fitch bases the enterprise
valuation.
The GC EBITDA estimate compares with a combined company EBITDA of
$1.155 billion in 2018 and combined company EBITDA of $937 million
in 2016. The combined EBITDA calculation includes CLF's iron ore
sales to AK Steel and is a straight addition (no synergies, for
example). Fitch's GC EBITDA estimate is on the lower end to reflect
CLF's high exposure to the cyclical automotive market and the
cyclical and volatile nature of steel prices.
Fitch generally applies EBITDA multiples that range from 4.0x-6.0x
for metals and mining issuers given the cyclical nature of
commodity prices. Fitch has applied a 5.0x multiple to the GC
EBITDA estimate to calculate a post-reorganization enterprise value
of $4.05 billion after an assumed 10% administrative claim. The
5.0x multiple compares with CLF's 5.6x acquisition multiple based
off AK Steel's LTM-adjusted EBITDA as of Sept. 30, 2019.
The allocation of value in the liability waterfall results in a
Recovery Rating of 'RR1' for the first-lien secured ABL credit
facility and the first-lien secured notes, which results in a 'BB'
rating; an 'RR5' for the CLF senior unsecured guaranteed notes,
which results in a 'B-' rating and an 'RR6' for the CLF unsecured
notes not benefitting from guarantees; the AK Steel guaranteed
unsecured notes and the CLF convertible notes resulting in a 'CCC+'
rating. The unsecured convertible notes and unsecured 2040 notes do
not benefit from guarantees and are therefore subordinated in the
recovery waterfall.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
-- Total debt/EBITDA sustained below 3.5x;
-- Expectation of sustained positive FCF.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
-- Total debt/EBITDA sustained above 4.5x;
-- Weaker than expected auto demand and/or slower than
anticipated economic recovery resulting in sustained
negative FCF;
-- Deteriorating liquidity position.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: As of March 31, 2020, CLF had $186.8 million in
cash and cash equivalents and $790 million available under its $2
billion ABL credit facility due 2025. The ABL credit facility
matures in 2025 or 91 days prior to the stated maturity date of any
portion of existing debt if the aggregate amount of existing debt
matures on that 91st day is greater than $100 million. The ABL
credit facility is subject to a springing 1.0x minimum fixed-charge
coverage covenant when availability is less than the greater of i)
10% of the lesser of a) the Maximum ABL amount (currently $2
billion) and b) the borrowing base and ii)$100 million. CLF has
suspended its dividend and has no material maturities until 2024
although does have pension expense obligations.
ESG Considerations
Unless otherwise disclosed in this section, the highest level of
Environmental, Social and Governance credit relevance is a score of
'3' - ESG issues are credit neutral or have only a minimal credit
impact on the entity, either due to their nature or the way in
which they are being managed by the entity.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
Cleveland-Cliffs Inc.
- LT IDR B New Rating
- Senior unsecured; LT CCC+ New Rating
- Senior unsecured; LT B- New Rating
- Senior secured; LT BB New Rating
AK Steel Corporation
- LT IDR B New Rating
- Senior unsecured; LT CCC+ New Rating
- Senior secured; LT BB New Rating
COWBOY PUMPING: Seeks Approval to Tap PPL Group as Auctioneer
-------------------------------------------------------------
Cowboy Pumping Unit Sales & Repairs, LLC seeks approval from the
U.S. Bankruptcy Court for the Western District of Oklahoma to
employ PPL Group, LLC as auctioneer.
The Debtor desires to employ PPL Group for the purpose of
liquidating its assets, rolling stock and equipment.
PPL Group will receive a commission of 2.5%, charge a buyer's
premium of 10% for onsite sales and 13% for online sales and be
reimbursed for certain expenses, subject to the approval of this
Court.
PPL Group, LLC is a "disinterested person" within the meaning of
Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
PPL GROUP, LLC
105 Revere Drive, Suite C
Northbrook, IL 60062
Telephone: (224) 927-5300
About Cowboy Pumping Unit Sales & Repairs
Cowboy Pumping Unit Sales & Repair, LLC disassembles, repairs,
moves or reassembles any pumping unit equipment. It was created to
provide service to oil and gas operators that have pumping units in
Central and Northwest Oklahoma.
Cowboy Pumping Unit Sales & Repair filed a voluntary petition under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Okla. Case No.
19-14561) on Nov. 7, 2019. In the petition signed by Tom Holder,
vice-president, the Debtor was estimated to have $50,000 in assets
and $10 million to $50 million in liabilities. Stephen J. Moriarty,
Esq.,at Fellers, Snider, Blankenship, Bailey & Tippens, P.C., is
the Debtor's counsel.
CRC BROADCASTING: U.S. Trustee Unable to Appoint Committee
----------------------------------------------------------
The Office of the U.S. Trustee on July 8 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of CRC Broadcasting Company.
About CRC Broadcasting Company
CRC Broadcasting Company, Inc., a broadcast media company based in
Scottsdale, Ariz., filed a voluntary petition under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 20-02349) on March 6,
2020, listing under $1 million in both assets and liabilities.
Allan D. NewDelman, Esq., at Allan D. NewDelman, P.C. is Debtor's
legal counsel.
CROCKETT COGENERATION: Moody's Hikes Sr. Sec. Notes to B2
---------------------------------------------------------
Moody's Investors Service upgraded Crockett Cogeneration, LP's
senior secured notes to B2 from B3. The outlook is stable. These
actions conclude the review for upgrade that was initiated on June
16, 2020.
RATINGS RATIONALE
The upgrade to B2 of Crockett Cogeneration, LP's ("Crockett")
senior secured notes reflects the July 1st emergence from
bankruptcy by Pacific Gas & Electric Company (PG&E) and its parent,
PG&E Corporation (Ba2-stable; Corporate Family Rating) as the
utility has completed its restructuring process and will assume
power purchase agreement (PPA) obligations, including the PPA with
Crockett. PG&E's bankruptcy and the risk of PPA rejection in
bankruptcy had been the primary risk constraining Crockett's credit
quality since the project derives most of its operating cash flow
from its PPA with PG&E that expires in 2026. Through the PG&E
bankruptcy, the utility remained current on obligations owed to
Crockett.
The rating also acknowledges Crockett's historically volatile
financial performance that is expected to continue through the term
of the debt. When determining the energy revenue component of
Crockett's revenues, the market heat rate used is the short-run
avoided cost (SRAC), which has increased the volatility of
Crockett's cash flow owing to low natural gas prices, variation in
hydrology levels and the continued increase in installed renewable
electric capacity across California. During 2019, the market heat
rate, which helps determine the SRAC price, increased to an average
of 8,284 Btu/kwh from 7,310 Btu/kwh in the previous year, leading
to an improvement in the debt service coverage ratio (DSCR) being
above the 1.20x restricted payment test for the first time in three
years. During 2020, the market heat has declined which will likely
lower 2020 results relative to 2019.
Crockett also has exposure to greenhouse gas emission costs each
year which also reduces annual free cash flow generation. Given the
project is able to defer some of its greenhouse gas emission (GHG)
costs based on a pre-determined schedule that trues up every third
year, in the event the project does not purchase all of the
corresponding carbon instruments in the year GHG emissions are
incurred, the DSCR on a cash basis could be less than 1.0x, in such
true-up year. As of FY 2019 the project had $16.9 million in carbon
instrument liabilities associated with FY 2018 and FY 2019 emission
costs yet to be purchased during 2020 and 2021. Crockett faces a
large payment obligation in 2021 owing to greenhouse gas emission
costs which will test the project's ability to manage its liquidity
while also managing its exposure to SRAC determined energy prices.
Partially mitigating this risk is the fact that the project has
locked in the cost of this liability at $17.45/ton for the 2021
delivery year.
Crockett's liquidity remains adequate with a cash funded 6-month
debt service reserve fund of $12 million that was previously backed
by a $25 million letter of credit facility that was terminated on
March 6, 2020 and replaced with cash. In addition to the debt
service reserve fund, as of March 31, 2020, the project had $3.7
million in the major maintenance reserve account and unrestricted
cash of $7 million.
OUTLOOK
The stable outlook reflects the stable outlook of PG&E, its
expectation that the project will continue to operate well and that
the project will continue to be able to manage its liquidity in
terms of meeting greenhouse gas emission costs each year based upon
the assumption that the market heat rate will remain within a range
that produces adequate financial metrics and positive free cash
flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to an upgrade
Given the ongoing challenges associated with SRAC and GHG
liabilities, the project's rating is unlikely to move up at this
point. The rating could see upward pressure if Crockett can
demonstrate its ability to cover its upcoming large carbon
instrument purchases for delivery in 2021, and an ability to
achieve DSCR that approximates 1.10x on a sustained basis based on
the project's current contractual arrangements while maintaining
strong operating performance.
Factors that could lead to a downgrade
The rating could be downgraded if market heat rates decline again
below the 7,000 level on a sustained basis, if there are sustained
increases in carbon prices beyond 2021, if the project experiences
chronic operating problems that cannot be addressed in a manageable
timeframe, or if the DSCR is expected to hover well below 1.0x
consistently. Also, Crockett's rating would be negatively affected
if PG&E's credit quality were to severely deteriorate or if the
project lost its Qualifying Facility (QF) status.
PROFILE
Crockett is a California limited partnership formed in 1986 to own
and operate a 240-megawatt natural gas-fired electric power and
steam cogeneration facility located at the C&H sugar refinery in
Crockett, California. The entire electric output is sold to PG&E
under a 30-year Power Purchase Agreement (PPA) that expires in May
2026, and the steam is sold to C&H under a steam sales agreement
that expires in 2026. The facility operates as a QF as defined
under the Public Utility Regulatory Policies Act of 1978 (PURPA).
Consolidated Asset Management Services (CAMS) provides operations
and maintenance services.
Crockett is currently indirectly owned by GEPIF NAP I Holdings, LLC
(FREIF), who is indirectly owned by an infrastructure fund managed
by BlackRock, and 8.27% by Osaka Gas Company, Ltd.
METHODOLOGY
The principal methodology used in this rating was Power Generation
Projects published in June 2018.
D & H HEALTHCARE: Taps Kathleen Nicholson as Accountant
-------------------------------------------------------
D & H Healthcare Professionals, LLC seeks approval from the U.S.
Bankruptcy Court for the Southern District of Texas to employ
Kathleen Nicholson & Associates as its accountant.
Kathleen Nicholson & Associates will render the following services
to the Debtor:
(a) record and post coded transactions determined or approved
by management to general ledger monthly, providing summaries of
checks and disbursements and receipts;
(b) propose standard adjusting, or correcting journal entries
to be checked and approved by management monthly, providing a
summary of recommended adjustments for management approval;
(c) post approved entries to trial balances monthly, providing
trial balance (unadjusted and adjusted);
(d) reconcile bank account monthly, providing reconciliation
work papers, and list of items for client to follow up; and
(e) prepare monthly operating reports, prepare/file tax
returns and any additional services as needed.
The firm has agreed to provide book keeping services, monthly
operating report preparation and preparing tax returns and
additional services as needed at a flat hourly rate of $225.00 for
Kathleen Nicolson CPA, $175.00 for Fae Faber CPA, and $85.00 for
clerical when appropriate.
To the best of the Debtor's knowledge, Kathleen Nicholson &
Associates is a "disinterested person" as that term is defined in
section 101(14) of the Bankruptcy Code.
The firm can be reached at:
KATHLEEN NICHOLSON & ASSOCIATES
3001 E Broadway St.
Pearland, TX 77581
Telephone: (281) 485-1099
E-mail: charlotte@kanicholsoncpa.com
About D & H Healthcare Professionals
Based in Webster, Texas, D & H is a multi-specialty clinic formed
on July 17, 2012 owned by Dr. David A. Fairweather and Hilarice M.
John-Fairthweather and operated by Dr. David A. Fairweather. Dr.
Fairweather is a licensed physician whose practice focuses on
family and internal medicine.
D & H Healthcare Professionals, LLC, sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No.
20-30929) on Feb. 4, 2020, listing under $1 million in both assets
and liabilities. Hon. Christopher M. Lopez oversees the case. The
Debtor tapped Corral Tran Singh, LLP as its counsel and Kathleen
Nicholson & Associates as its accountant.
DANIEL T. LEE: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Daniel T. Lee Dental Corporation
d/b/a Northern California Dental
455 O'Connor Drive, Suite 320
San Jose, CA 95128
Case No.: 20-51022
Business Description: Daniel T. Lee Dental Corporation owns and
operates a dental clinic.
Chapter 11 Petition Date: July 8, 2020
Court: United States Bankruptcy Court
Northern District of California
Judge: Hon. Elaine M. Hammond
Debtor's Counsel: Stanley Zlotoff, Esq.
STANLEY A. ZLOTOFF
300 South First Street
Suite 215
San Jose, CA 95113
Tel: (408) 287-5087
Total Assets: $259,121
Total Liabilities: $1,640,036
The petition was signed by Daniel T. Lee, president.
A copy of the petition containing, among other items, a list of the
Debtor's 20 largest unsecured creditors is available for free at
PacerMonitor.com at:
https://is.gd/b5GvaI
DEFOOR CENTRE: GB Square Buying Atlanta Property for $1.3M
----------------------------------------------------------
Defoor Centre, LLC, asks the U.S. Bankruptcy Court for the Middle
District of Florida to authorize the private sale of real property
located at 1710 Defoor Avenue NW, Atlanta, Georgia to GB Square,
LLC for $3.13 million.
Prior to the Petition Date, the Debtor listed the Property for sale
and entered into a Contract for Sale and Purchase with GB Square,
LLC dated Jan. 15, 2020. GB applied for financing as was approved
by Newtek Business Lending for a loan through the Small Business
Administration.
Due to the COVID-19 pandemic, the SBA has not funded the loan as
the paycheck protection funding has taken priority. GB has been in
constant contact with the Lender which has assured GB that
financing would be forthcoming.
The Debtor and GB have entered in multiple amendments to the
Contract to extend the closing date which is now on July 31, 2020.
The last amendment is the Fifth Amended to Contract for Sale and
Purchase.
The material terms to the sale contemplated by the Contract are:
A. Purchase Price: The purchase price is $3.13 million of
which the Debtor anticipates distributions.
B. Financing Contingency: GB agreed to deposit additional
funds to extend the inspection period, and therefore, extend the
closing date. The Fifth Amendment required an additional $30,000
of nonrefundable deposit be made available to the Debtor.
C. Free and Clear: The Property is being sold to GB on a free
and clear basis of all Interest other than those identified.
D. Closing: The closing for the Sale will take place on or
before July 31, 2020.
The Sale is an "arms'-length" transaction and GB is not affiliated
with the Debtor.
The Debtor asks approval to immediately sell on an emergency basis,
lest GB terminate the Contract, the Property free and clear of all
Interests except as identified through the procedures set forth in
the Motion.
The Debtor and GB will obtain a Commitment for Title Insurance
identifying any Interests on Schedule B-II that will survive the
closing.
The Debtor asks to sell the Property, free and clear of all
Interests except for as specifically identified, pursuant to
Sections 363(b) and (f). It believes the private sale of the
Property is in the best interest of the estate and its creditors.
The Debtor submits that the Property can be sold free and clear of
Interests because, among other reasons, those lienholders are being
provided with a monetary satisfaction at closing for their
Interest: PHH Mortgage holds a first mortgage on the Property.
The Debtor has identified the debt at $1,961,774 and anticipates it
will be paid in full out of the Sale.
The Debtor anticipates the $3.13 million sale proceeds to be paid
approximately as follows: $1,961,774 to PHH Mortgage, $239,229 to
closing costs, and $928,997 to the Debtor. The Debtor will use its
proceeds to fund plan payments and for all other allowed uses.
The Property has been sufficiently exposed to the market and its
value has been subject to market testing. The additional time and
expense that would be incurred if the Property was publicly sold or
auctioned would not likely enhance the purchase price to justify
the additional cost.
Based on this and the Debtor's business judgment, the Debtor
believes the purchase price is reasonable and proceeding with the
sale of the Property to the GB will maximize the value of the
Property for the benefit of the estate and her creditors.
Furthermore, Marcus & Millichap ("M&M") has acted as the broker to
the Sale. To the extent necessary the Debtor asks that the Court
authorizes and approves their commission pursuant to Sections 327
and 328 of the Bankruptcy Code. Composite Exhibit C is their
Representation Agreement and Addendum to Representation Agreement.
The Debtor asks expedited relief so as to proceed forward with the
Sale and obtain a final sale order otherwise the Buyer may
terminate the same. It also asks that any order of the Court
authorizing the Sale be effective immediately upon its entry,
notwithstanding the contrary provisions of Federal Rule of
Bankruptcy Procedure 6004(h).
Finally, the Debtor asks that any notice period proscribed by
Federal Rule of Bankruptcy Procedure 2002 be shortened to
facilitate the consideration of the Motion on an expedited basis.
A copy of the Contract is available at https://tinyurl.com/ydxy3lvr
from PacerMonitor.com free of charge.
About Defoor Centre
Defoor Centre, LLC, owns a real property located at 1710 Defoor
Ave.
NW, Atlanta, known as The Defoor Center (www.defoorcentre.com).
The
property is an events venue ideal for private weddings, mitzvahs,
corporate meetings and parties.
Defoor Centre sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. Fla. Case No. 20-04273) on June 1, 2020. At the
time of the filing, the Debtor disclosed total assets of $3,588,000
and
total liabilities of $3,349,560. The Debtor is represented by
Jennis
Law Firm.
DIXON PAVING: Proposed Sale of Equipment Approved
-------------------------------------------------
Judge David M. Warren of the US Bankruptcy Court for the Eastern
District of North Carolina authorized Dixon Paving, Inc.'s sales
procedures in connection with the sale of any of the equipment
listed on Exhibit A.
All sales of the Property will comply with the following
procedures:
a. The Debtor may sell any of the equipment listed on Exhibit
A that meets or exceeds the minimum price approved by the Court for
such equipment without further motions or orders of the Court after
giving five days' notice of the purchase price and purchaser to the
applicable purchase money lienholder, North State Bank, and the
Bankruptcy Administrator by email;
b. The sales proceeds will be distributed to lienholders in
accordance with the priorities of liens, after deducting the
approved commission for such sale to Brinson Tractor;
c. All sales will be to bona fide purchasers and not insiders
or affiliates of the Debtor;
d. The Debtor will include the details of the sale in its next
monthly report, including the purchase price, date of sale, name of
the purchaser, disposition of the proceeds to the applicable
lienholder(s), and
e. Sales which occur pursuant to this Order will only occur
between approval of the Motion and the Effective Date of any
confirmed chapter 11 Plan of Reorganization. Following approval of
a Plan of Reorganization, any sales of the Property that have not
occurred prior to the Effective Date of any Plan of Reorganization
will take place in accordance with the terms of the Plan of
Reorganization.
The Property will be sold, transferred and conveyed to the buyer,
and the sale, transfer and conveyance of the Property will vest in
the buyer all right, title and interest in the Property free and
clear of the following interests, liens, encumbrances, rights or
claims in the Property:
a. Any and all property taxes due and owing to any City,
County, or municipal corporation, including the Wake County Tax
Collector, City of Raleigh and the Town of Zebulon;
b. Any and all liens of North State Bank, DeLage Landen
Financial Services, Caterpillar Financial Services Corporation, ,
AMG Group LLC, Splash Funding, and Kalamata Capital Group, based
upon UCC financing statements filed with the North Carolina
Secretary of State;
c. The lien asserted by North State Bank by virtue of a lien
recorded on the North Carolina Division of Motor Vehicles
Certificate of Title;
d. The tax liens filed by the Internal Revenue Service with
the North Carolina Secretary of State bearing file numbers
20190102777H, 20190102796J, 20190127498E, and 20190135471E;
e. The tax liens filed by the Internal Revenue Service with
the Wake County Registry bearing file numbers 19 M 4206, 19 M 4217,
19 M 5621, and 19 M 5999.
f. The tax lien filed by the North Carolina Department of
Revenue with the Wake County Superior Court bearing file No. 20 M
853.
g. The liens and other interests named and described, if any
and if valid, will attach to the proceeds of the sale of the
property in the order of their priority.
The Debtor asks to distribute the sales proceeds from any private
sale(s) to lienholders in accordance with the priorities of liens,
after payment of all costs of sale, including commissions owed to
Brinson Tractor and the pro rata share of any costs of sale under
Section 506(c) and quarterly fees.
The Order constitutes a final order within the meaning of 28 U.S.C.
Section 158(a). Good cause having been shown, the 14-day stay
period provided for in Federal Rule of Bankruptcy Procedure 6004(h)
is waived and the Order and the relief provided for therein shall
be effective and enforceable immediately upon entry and its
provisions will be self-executing.
A copy of the Exhibit A is available at
https://tinyurl.com/y9f258ts from PacerMonitor.com free of charge.
About Dixon Paving
Based in Raleigh, North Carolina, Dixon Paving, Inc., is a
commercial paving and milling company. Dixon Paving filed a Chapter
11 bankruptcy petition (Bankr. E.D.N.C. Case No. 20-00656) on Feb.
14, 2020. At the time of the filing, the Debtor was estimated to
have $1 million to $10 million in liabilities. The Debtor's
counsel is Trawick H. Stubbs, Jr., Esq. of STUBB & PERDUE, P.A.
EASTERN NIAGARA: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Eastern Niagara Hospital, Inc.
521 East Avenue
Lockport, NY 14094
Business Description: Eastern Niagara Hospital --
http://www.enhs.org-- is a not-for-profit
organization, focused on providing general
medical and surgical services. The Hospital
offers radiology, surgical services,
rehabilitation services, cardiac services,
respiratory therapy, obstetrics & women's
health, emergency services, acute &
intensive care, chemical dependency
treatment, occupational medicine services,
DOT medical exams, dialysis, laboratory
services, and express care. The Debtor
previously sought bankruptcy protection on
Nov. 7, 2019 (Bankr. W.D.N.Y. Case No. 19-
12342).
Chapter 11 Petition Date: July 8, 2020
Court: United States Bankruptcy Court
Western District of New York
Case No.: 20-10903
Judge: Hon. Carl L. Bucki
Debtor's Counsel: Jeffrey A. Dove, Esq.
BARCLAY DAMON LLP
Barclay Damon Tower
125 East Jefferson Street
Syracuse, NY 13202
Tel: 315-413-7112
Email: jdove@barlaydamon.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Anne E. McCaffrey, president and CEO.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/dF1ycF
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Cornerstone Community FCU $5,853,436
6485 South Transit Road
Lockport, NY 14094
2. PMAIC $689,092
380 Sentry Parkway
PO Box 3031
Blue Bell, PA 19422
3. Musculoskeletal Transplant Foundation $467,480
125 May Street
Suite 300
Edison, NJ 08837
4. Stryker Orthopaedics $414,157
325 Corporate Drive
Mahwah, NJ 07430
5. Clark Patterson Lee $304,275
205 St. Paul Street
Suite 500
Rochester, NY 14604
6. Kaleida Health Dept of Finance $286,656
726 Exchange Street
Suite 200
Buffalo, NY 14210
7. Boston Scientific Corporation $253,339
100 Boston Scientific Way
Marlborough, MA 01752
8. Keystone Medical Services NY, PC $220,368
Crescent Center
6075 Poplar Avenue,
Suite 401
Memphis, TN 38119
9. Spinal USA Inc. $208,711
2050 Executive Drive
Pearl, MS 39208
10. Kaleida Health Patient $208,561
726 Exchange Street,
Suite 300
Buffalo, NY 14210
11. X-Cell Laboratories of WNY Inc. $161,140
20 Northpointe Parkway
Suite 100
Buffalo, NY 14228
12. Siemens Medical Solutions USA Inc. $153,158
40 Liberty Boulevard
Malvern, PA 19355
13. CRS Nuclear Services LLC $137,133
840 Aero Drive,
Suite 150
Buffalo, NY 14225
14. Zimmer Biomet Spine Inc. $129,913
1800 West Center Street
Bldg 5 MS-5162
Warsaw, IN 46580
15. McKessonMedical-Surgical Inc. $128,017
9954 Mayland Drive, Suite 4000
Henrico, VA 23228
16. ALCON Laboratories, Inc. $123,912
6201 South Freeway
Fort Worth, TX 76134-2099
17. Trimedx Health Care $121,961
Equipment
5451 Lakeview Parkway South Drive
Indianapolis, IN 46268
18. Laboratory Corp America Holdings $121,281
PO Box 12140
Burlington, NC 27216-2140
19. Paradigm Spine LLC $120,750
505 Park Avenue, 14th Floor
New York, NY 10022
20. Intuitive Surgical Inc. $119,588
1266 Kifer Road
Sunnvale, CA 94086-5206
ECO BUILDING: Seeks Approval to Hire Bankruptcy Attorney
--------------------------------------------------------
Eco Building Products, Inc. seeks approval from the U.S. Bankruptcy
Court for the District of Colorado to employ Warren Katz, Esq., as
its attorney.
The legal services to be rendered by Warren Katz are as follows:
(a) provide the Debtor with legal advice with respect to its
powers and duties;
(b) aid the Debtor in the development of a plan of
reorganization under Chapter 11;
(c) file the necessary petitions, pleadings, reports, and
actions that may be required in the continued administration of the
Debtor's property under Chapter 11; and
(d) perform all other legal services for the Debtor that may
be necessary herein, subject to potential requirements of the
Debtor for the engagement of special counsel for certain specified,
limited purposes, if, when, and as required.
Mr. Katz will be compensated at his hourly rate of $350.00.
Warren Katz does not hold a pre-petition retainer for payment of
post-petition fees and costs. He was paid for his pre-petition fees
and costs, including the filing fee, by the Debtor in the amount of
$3,717.00.
Warren Katz, Esq., disclosed in court filings that he is a
"disinterested person" as that term is defined in section 101(14)
of the Bankruptcy Code.
The attorney can be reached at:
Warren Katz, Esq.
2949 North Broadway, Unit 2
Chicago, IL 60657
Telephone: (949) 697-4111
E-mail: wkatz@kentlaw.itt.edu
About Eco Building Products
Eco Building Products, Inc., a manufacturer of paint, coating, and
adhesive products based in Escondido, California, sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Case No.
20-14262) on June 22, 2020. The petition was signed by Steven
Plumb, its representative. At the time of the filing, the Debtor
was estimated to have total assets of $360,000 and total
liabilities of $5,135,080. Warren Katz, Esq., is the Debtor's
counsel.
EF-290: Seeks Court Approval to Hire Hajjar Peters as Counsel
-------------------------------------------------------------
EF-290, LLC seeks approval from the U.S. Bankruptcy Court for the
Western District of Texas to employ Hajjar Peters, LLP as counsel.
Hajjar Peters will render the following services to the Debtor:
(a) give the Debtor legal advice with respect to its powers
and duties as Debtor-in-Possession in the continued operation of
its business and management of his property;
(b) advise the Debtor of its responsibilities under the
Bankruptcy Code and assist with such;
(c) prepare and file the voluntary petition and other
paperwork necessary to commence this proceeding;
(d) assist the Debtor in preparing and filing the required
Schedules, Statement of Affairs, Monthly Financial Reports, the
Initial Debtor Report and other documents required by the
Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, the
Local Rules of this Court and the administrative procedures of the
Office of the United States Trustee;
(e) represent the Debtor in connection with adversary
proceedings and other contested and uncontested matters, both in
this Court and in other courts of competent jurisdiction,
concerning any and all matters related to these bankruptcy
proceedings and the financial affairs of the Debtor;
(f) represent the 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
this Court; and
(g) assist the Debtor in the formulation of a plan of
reorganization and disclosure statement, and in taking the
necessary steps in this Court to obtain approval of such disclosure
statement and confirmation of such plan of reorganization.
The firm's attorneys and professionals who will undertake this
representation will be paid at these hourly rates below:
Charlie Shelton $325
Other attorneys $150 - $425
Paralegal $150
In addition, the firm will charge the Debtor for any out-of-pocket
expenses incurred in this case, subject to the approval of this
Court.
Prior to the filing of this case, the firm received $20,000.00.
$14,190.50 was credited to prepetition billing, including $1,717.00
allocated to the filing fee. The firm is holding $5,809.50 in its
trust account.
Hajjar Peters, LLP has no connections with the Debtor's creditors,
the U.S. Trustee, any person employed by the Office of the U.S.
Trustee, or any other party-in-interest or their respective
attorneys.
The firm can be reached through:
Charlie Shelton, Esq.
HAJJAR PETERS, LLP
3144 Bee Caves Rd.
Austin, TX 78746
Telephone: (512) 637-4956
Facsimile: (512) 637-4958
E-mail: cshelton@legalstrategy.com
About EF-290
EF-290, LLC, a domestic limited liability company based in Austin,
Texas, sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. W.D. Tex. Case No. 20-10640) on May 29, 2020. At the time
of the filing, the Debtor disclosed assets of $1 million to $10
million and liabilities of the same range. Judge Tony M. Davis
oversees the case. The Debtor is represented by Hajjar Peters, LLP.
EXGEN RENEWABLES IV: Moody's Hikes Secured Term Loan to Ba3
-----------------------------------------------------------
Moody's Investors Service upgraded ExGen Renewables IV, LLC's
senior secured term loan to Ba3 from B2 and revised the borrower's
outlook to stable. This rating action concludes the review for
upgrade that commenced on June 16, 2020.
RATINGS RATIONALE
The upgrade of EGR IV to Ba3 from B2 considers the July 1st
emergence from bankruptcy by Pacific Gas & Electric Company (PG&E)
and its parent, PG&E Corporation (Ba2/stable; Corporate Family
Rating) which includes PG&E's assumption of its utility's power
purchase agreements (PPA) obligations including the PPA with EGR
IV's AV Solar Ranch 1, LLC's (AVSR) project. PG&E's bankruptcy and
the risk of PPA rejection in bankruptcy has been a key risk
constraining EGR IV's credit quality since nearly 40% of EGR IV's
originally expected dividends are from the AVSR solar project and
AVSR derives all of its operating cash flow from its PPA with
PG&E.
The upgrade additionally considers the expected near-term
resolution of AVSR's technical debt default and the expected
resumption of dividends from AVSR to EGR IV including applicable
dividends that have been trapped at AVSR since PG&E's bankruptcy
filing in January 2019. In the unlikely situation whereby AVSR's
technical debt default is not resolved, Moody's assumes EGR IV
would seek alternate options to address the cash trap at AVSR
including a possible refinancing of AVSR's debt now that PG&E has
emerged from bankruptcy.
Further supporting EGR IV's Ba3 rating is the borrower's broad
portfolio of renewable power projects with long term contracts,
ownership by Exelon Generation Company, LLC (ExGen: Baa2 stable),
use of mostly proven technology and debt structural protections.
The borrower's credit profile also reflects its high leverage at
almost 10.0x Adjusted Debt to EBITDA resulting in low consolidated
cash flow metrics, modest holdco level cash flow coverage,
structural subordination to operating company debt across most
assets, cash flow concentration at AVSR, and underlying resource
risk.
Rating Outlook
EGR IV's stable outlook reflects the expected resumption of
dividends from AVSR and expected improvement to holding company
debt service coverage ratio (DSCR) to above 2.0x on normalized
basis while achieving 1.3-1.4x consolidated DSCR and around 5% to
6% Project CFO to Debt.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to an upgrade
- The borrower repays debt substantially greater than expected
- Substantial improvement to off taker credit quality including
PG&E
- Project CFO to Debt above 10%, consolidated DSCR above 1.5x,
and Debt to EBITDA below 7.5x on a sustained basis
Factors that could lead to a downgrade
- Consolidated DSCR drops materially below 1.20x, consolidated
Project CFO to Debt drops below 4% or Debt to EBITDA exceeds
10x on a sustained basis
- AVSR or a substantial portion of the portfolio incurs major
operational problems
- The borrower is unable to receive a material portion of its
dividends from its underlying projects
- Substantial credit deterioration of major project level
offtakers including PG&E
ExGen Renewables IV, LLC, a holding company, indirectly owns around
a 1 GW (net ownership adjusted) portfolio of 33 operating solar,
wind and biomass power projects spread over 15 states. The projects
reached commercial operations from 2007 through 2017 and most of
the assets have operating company level debt while a few others
have tax equity financings. Almost half of EGR IV's dividends flow
through ExGen Renewables Partners, LLC (EGRP), a joint venture with
John Hancock Life Insurance Company (USA). ExGen indirectly owns
100% of EGR IV. As of June 2020, EGR IV had $774.5 million
outstanding on its senior secured term loan.
The principal methodology used in this rating was Power Generation
Projects published in June 2018.
FLOYD CHARLES YORK: Clark Buying Oxon Hill Property for $335K
-------------------------------------------------------------
Floyd Charles York asks the U.S. Bankruptcy Court for the Eastern
District of Virginia to authorize the sale of the real property
located at 2212 Owens Road, Oxon Hill, Maryland to Monica Maria
Clark for $355,000.
York has a 50% membership interest in Hillox, LLC, the entity that
is the owner of the Property. The remaining 50% interest is owned
by John Donovan. The Property is the sole asset of Hillox.
On May 31, 2020, Hillox entered into Sales Contract to sell the
Property to the Buyer for $355,000 with an expected closing date of
June 30, 2020. Hillox is required to pay from the purchase price
closing costs of $17,281.
The Buyer's agent, Pam Milan and Century 21 New Millennium will be
paid a commission of 2.5% of the sales price, or $8,875. To the
extent it is required York asks approval of his and Coldwell Banker
Residential Brokerage's employment as sales agent for Hillox. York
and Coldwell Banker Residential Brokerage are to be paid a
commission of 3.5% of the sales price, or $12,425.
The Property is subject to a Deed of Trust held by Ceres Capital
Partners, LLC which has a current balance of approximately
$221,000.
A gap lender, Omni Casey, is owed $26,000 arising from a loan dated
Dec. 3, 2020 and this amount is to be paid at settlement.
York and John Donovan have made capital contributions to complete
renovation of the Property which are to be paid to them at
settlement. Donovan has contributed approximately $46,487.37 and
York approximately $23,074.
York does not anticipate any tax liability resulting from the sale
due to the significant expenditures to renovate the Property and
because he did not take depreciation on the Property.
York asks that the Court approves the sale of the Property under
the terms of the Sale Contract and authorize the payment at
settlement of the Deed of Trust Note; real estate commissions; gap
loan to Omni Casey; capital contributions; all other ordinary and
appropriate fees and costs that arise in connection with the
closing on the sale of the Property, consistent with the sales
contract and existing brokerage agreements with all remaining funds
to be distributed to York and John Donovan pursuant to their 50%
membership interests in Hillox.
In order to ensure the expeditious closing of the proposed sale
consistent with the closing date established in the sales contract,
York further asks that the 14-day stay of any order authorizing
sale of the Property be waived.
A copy of the Contract is available at https://tinyurl.com/ydxdv3me
from PacerMonitor.com free of charge.
Counsel for Debtor:
Jonathan B. Vivona, Esq.
JONATHAN B. VIVONA, PLC
601 King Street, Suite 400
Alexandria, VA 22314
Telephone: (703) 739-1353
Facsimile: (703) 337-0490
E-maiL: vivonalaw@gmail.com
Floyd Charles York sought Chapter 11 protection (Bankr. E.D. Va.
Case No. 19-13106) on Sept. 18, 2019. The Debtor filed pro se.
FLOYD SQUIRES: Liquidating Agent Selling Eureka Property for $185K
------------------------------------------------------------------
Janina M. Hoskins, the Liquidating Agent of the estate of the Floyd
E. Squires III and Betty J. Squires, asks the U.S. Bankruptcy Court
for the Northern District of California to authorize the sale of
the real property located at 119 West 6th Street, Eureka,
California, an improved parcel, to Matthew T. Woods or his designee
for $185,000, higher and better bids.
The Property generates $2,450 per month in revenue. The
Liquidating Agent moves to sell the Property to the Buyer. The
Property will be sold free and clear of liens.
Subject to Court approval and higher and better bids, the
Liquidating Agent has accepted an offer of $185,000 from the Buyer
for the Property, with an initial deposit of $5,500 and the balance
to be paid at the close of escrow, with escrow to close within 10
days after entry of an order approving the sale.
Any and all terms of the Sale Agreement, including, but not limited
to the payment of any commissions, are subject to the approval of
the United States Bankruptcy Court for the Northern District of
California and overbid.
The Buyer is purchasing the Property on an "as is, where is" basis,
with no warranties or representation. The Property is occupied.
The Liquidating Agent has no obligation to remove tenants; only to
give notice, if requested to do so. Any dispute over the terms of
the Sale Agreement will be resolved by the Bankruptcy Court.
The sale is subject to overbids, with a minimum overbid in the sum
of $195,000 all cash, on the same terms and conditions as the Sale
Agreement, with the overbid deadline being set three days prior to
the Court hearing on the Motion. If a qualified overbid is
received, an auction will be held telephonically.
A title report for the Property notes a deed of trust in the amount
of $50,000 for beneficiary Trueman E. Vroman, an unmarried man,
recorded May 25, 2005 as Instrument No. 2005-17304-6 in the
Official Records of Humboldt County. The title report notes an
"additional advance to be secured by said deed of trust" in the
amount of $20,000 recorded Aug. 24, 2005 as Instrument No.
2005-28757-3 in the Official Records of Humboldt County.
The Liquidating Agent believes that the Property can be sold free
and clear of these liens, with valid amounts being paid from escrow
or if any amounts are disputed, the sale may be accomplished under
11 U.S.C. Section 363(f)(4). Further, the Liquidating Agent
believes the above liens have been paid by the sale of other real
property of the estate that cross-collateralized these
obligations.
The Property has been declared "tax defaulted" for non-payment of
delinquent taxes for fiscal years 2012-2013, with the amount
indicated as of April 30, 2020 of $39,793. The Liquidating Agent
plans to pay all or a portion of this amount, depending on the
analysis of the amounts claimed and whether or not the amount
includes penalties that could or should be subordinated under the
terms of Bankruptcy Code Section 726(a)(4). The Liquidating Agent
anticipates that the matter will be resolved prior to the closing
of the sale. Accordingly, she believes that the Property can be
sold free and clear of any portion of the defaulted taxes that are
in
dispute.
A title report includes a notice of "Substandard Condition and
Order to Abate Same" executed by the City of Eureka and recorded
Jan. 20, 1998 as Instrument No. 1998-1263-5 in the Official Records
of Humboldt County. The Liquidating Agent believes that this
encumbrance has most likely been addressed but not removed from the
Property. Accordingly, she believes the Property can be sold free
and clear of this encumbrance.
The Property is subject to various interests in favor of the City
of Eureka, a municipal corporation, including four abstracts of
judgment. The Liquidating Agent believes she can sell free and
clear of the these liens or encumbrances, and that, the City of
Eureka will consent to the sale and execute those documents as may
be necessary to satisfy the title company prior to closing. At the
City of Eureka's request, it is possible the Liquidating Agent will
request paragraphs in an order authorizing the sale of the Property
that removes the City of Eureka's liens only as to the Property and
not to other properties encumbered by the liens in favor of the
City of Eureka. Further, any sale order will provide that the City
of Eureka will not be prevented from enforcing any rights or
remedies against the Property based upon any condition or violation
that arises or continues from and after the closing.
The Liquidating Agent asks an order authorizing her to direct
payment from escrow of the following standard expenses: (i) a real
estate broker's commission not to exceed 6% of the total sales
price, which will be split with the Buyer's broker; and (ii)
standard closing costs, including but not limited to unpaid real
property taxes, escrow fees, if any, recording costs and the like.
The Liquidating Agent asks that the order approving the proposed
sale of the Property provide that the Order approving the sale is
effective upon entry, and the stay otherwise imposed by Rule 62(a)
of the Federal Rules of Civil Procedure and/or Bankruptcy Rule
6004(h) will not apply.
About the Squires
Floyd E. Squires, III, and Betty J. Squires filed for chapter 11
protection (Bankr. N.D. Cal. Case No. 16-10828) on Nov. 8, 2017,
and are represented by David N. Chandler, Esq. of the Law Offices
of David N. Chandler.
Janina M. Hoskins was appointed as examiner of the Debtors on April
23, 2018. DENTONS US LLP, led by Michael A. Isaacs, is the
examiner's counsel.
GAMESTOP CORP: Moody's Hikes CFR to B3 & Alters Outlook to Stable
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of GameStop Corp.
following the announcement that approximately 52% of the existing
senior unsecured noteholders have agreed to exchange those notes
for new secured notes due 2023. Ratings upgraded include the
company's Corporate Family Rating to B3 from Caa1, Probability of
Default Rating to B3-PD from Caa1-PD, senior unsecured rating to
Caa1 from Caa2, and senior secured rating to B2 from B3. The
company's Speculative Grade Liquidity rating is unchanged at SGL-3.
The outlook is stable. This concludes the review for upgrade that
was initiated on June 5, 2020.
"The exchange of more than 50% of the company's senior unsecured
notes improves GameStop's debt maturity profile as about $216
million of its $415 million unsecured notes that were due in March
2021 are now due in March 2023," stated Pete Trombetta, Assistant
Vice President at Moody's. In addition, the upgrade of the CFR to
B3 reflects Moody's expectation that GameStop will repay at par the
remaining unsecured notes upon their maturity in March 2021 using
excess cash balances. This improved debt maturity profile is
especially important given the industry and earnings pressure the
company is facing including the impact from the coronavirus
pandemic and delayed software releases. Despite the improvements in
liquidity from the eased maturity schedule, the company's SGL-3 is
unchanged at this time as Moody's expects the company to generate
free cash flow deficits until the fourth quarter of 2020 and it
will use about $198 million of cash to repay the remaining notes
both of which will be supported by its sizable cash balances.
Upgrades:
Issuer: GameStop Corp.
Probability of Default Rating, Upgraded to B3-PD from Caa1-PD,
Previously on Review for Upgrade
Corporate Family Rating, Upgraded to B3 from Caa1, Previously
on Review for Upgrade
Senior Secured Regular Bond/Debenture, Upgraded to B2 (LGD3)
from B3 (LGD3), Previously on Review for Upgrade
Senior Unsecured Regular Bond/Debenture, Upgraded to Caa1
(LGD5) from Caa2 (LGD5), Previously on Review for Upgrade
Outlook Actions:
Issuer: GameStop Corp.
Outlook, Changed to Stable from Rating Under Review
RATINGS RATIONALE
GameStop's B3 Corporate Family Rating is constrained by its weak
EBIT/interest coverage of less than 1.0x, the ongoing secular
pressures that GameStop is facing including new technology trends
that pressure the traditional business gaming model such digital
downloads and streaming and subscription services, and its
vulnerability to product renewal cycles including new gaming
console launches. GameStop's CFR also reflects Moody's expectation
for lower EBITDA in 2020 despite the material improvement in
earnings that is expected in the fourth quarter of 2020. In the
near term, GameStop's credit profile reflects the disruption caused
by the coronavirus. Moody's expects the second quarter of 2020 to
be the trough in terms of sales declines as most of the company's
stores have reopened across the US and the world. However, Moody's
expects the company will continue to see ongoing pressure on
revenue and margins until the new console launches in the fourth
quarter of 2020, which should drive a recovery in performance.
GameStop benefits from its adequate liquidity and improved working
capital management. The company's credit profile is further
supported by its moderate scale and international reach, leading
market position, and the flexible footprint of its store base.
The stable outlook reflects Moody's expectation that the company
will have adequate liquidity to repay in full at par the March 2021
maturity of its remaining outstanding unsecured notes and will see
earnings improvement when the new consoles are introduced later
this year.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if GameStop is able to return to growth
in the company's core segments, including new and pre-owned games,
with expanding margins and top line revenue growth. An upgrade
would also require the company maintain at least adequate
liquidity. Quantitatively, an upgrade could occur if debt/EBITDA
was maintained below 3.5x, and EBIT/interest was comfortably over
2.0x. Ratings could be downgraded if the fourth quarter console
replacement cycle is weaker than anticipated, if the company's
liquidity were to deteriorate, or if EBIT/interest does not improve
to above 1.0x.
GameStop Corp., headquartered in Grapevine, Texas, is the world's
largest dedicated retailer of video game products. GameStop
operates over 5,300 stores in 14 countries with revenue of around
$6.5 billion for the last twelve-month period ended February 1,
2020.
The principal methodology used in these ratings was Retail Industry
published in May 2018.
GERALDINE R. ROSINE: Trustee Selling Pinole Property for $360K
--------------------------------------------------------------
Kari Bowyer, the Chapter 11 Trustee of the estate of Geraldine Rose
Rosine, asks the U.S. Bankruptcy Court for the Northern District of
California to authorize the sale of the real property located at
781 San Pablo Ave., Pinole, California to Juan Venica and Valeria
Ode for $360,000, subject to overbid.
Among the assets of the Bankruptcy Estate is the Property. The
Property is owned entirely by the estate through the Geraldine R.
Rosine 2009 Revocable Living Trust UDT dated Jan. 28, 2009. The
Exemption Trust of the R&G 1993 Family Trust UDT Dated Feb. 1,
1993, does not hold an interest in the Property. There is a
judgment lien recorded against the Property by the Mark Thorson
Revocable Trust. The Exemption Trust and the Thorson Trust have
entered into an agreement with the Trustee that allows for the sale
of the Property free and clear of their interests. An order was
entered on Jan. 8, 2020 approving the compromise.
The Trustee believes that the sale of the Property upon the terms
set forth in the Notice is in the best interest of the Bankruptcy
Estate and its creditors. The Property was actively marketed by
the broker and the offer from the Buyer is the highest and best
offer received. Based on the Trustee's real estate agent's
assessment of value and the marketing of the Property, the Trustee
believes that the proposed sale is in the best interest of the
Bankruptcy Estate.
The Buyers have agreed to purchase the Property for the total sum
of $360,000, subject to Court approval and overbid. The Trustee
anticipates paying from the proceeds of sale a real estate
commission of 6% of the commission on the Purchase Price to her
real estate broker, Andy Buchanan of Intero Real Estate Services -
Los Altos, to be split with the Buyers' agent. The Trustee also
proposes to pay associated costs of sale, including but not limited
to, pro-rated real property taxes, county transfer taxes, natural
hazard zone disclosure report, and smoke alarm and carbon monoxide
device installation and water heating bracing, if required.
The Thorson Trust recorded an abstract of judgment in the amount of
$1,652,582 on Feb. 14, 2018 with the Contra Costa County recorder's
office as document no. 2018-0023584-00. The current amount of the
Thorson Trust lien is approximately $2,051,605. As noted, the
Thorson Trust has agreed in the compromise to the sale of the
estate property free and clear of its lien pursuant to the terms of
the compromise that was approved by order entered on Jan. 8, 2020.
As provided in the agreement, the lien is to reattach to the net
proceeds attributable to the Bankruptcy Estate's interest in the
Property until it is paid and the Trustee is to pay 90% of the net
proceeds, i.e. proceeds remaining after payment of costs of sale,
pro rata property taxes, income tax incurred by the estate in
connection with the sale, broker commission, and other related
charges, attributable to the Bankruptcy Estate’s interest in the
Property to the Thorson Trust. The Trustee asks authority to pay
this amount to the Thorson Trustee as a partial payment of the
lien.
The Trustee's accountant in the case, estimates that there may be
taxes incurred by the Bankruptcy Estate in connection with the sale
of the Property in an amount up to $16,000. The Trustee asks
authority to pay the amount from the proceeds attributable to the
Bankruptcy Estate's interest in the Property. In addition, there
are liens recorded by Contra Costa County from 2010 through 2019
for unsecured property taxes. The liens are approximately $100
each year and total approximately $1,000, plus additional interest
and fees. The Trustee also requests authority to pay these tax
liens.
There is furniture and other personal property that will need to be
removed prior to the closing of the sale and there may be
inspection fees and repairs that will need to be paid prior to
closing of the sale. The Trustee asks authority to pay these
costs, estimated to not exceed $10,000, and, in the event these
fees are advanced by the Trustee's real estate agent, the Trustee
asks authority to reimburse the agent.
The Trustee will ask that the Court's order allow the Trustee to
make minor modifications to the purchase agreement including how
title is to be vested to the Buyers as they may instruct. The
Trustee will also request that the Court's order provide that in
the event the the Buyers do not close the sale transaction, the
Trustee will be authorized to sell the Property on the same terms
and at the same or greater price to an alternate purchaser without
a further order of the Court, unless the alternate purchaser is an
insider, then the Trustee would only be authorized to sell the
Property to the alternate purchaser after further order of the
Court after providing 24 hours' notice to the Debtor's counsel and
Office of the U.S. Trustee by an Ex Parte Application. The Trustee
will also retain the right to negotiate minor changes to the sale
agreement, without further Court order. The Trustee will also
retain the right to negotiate minor changes to the sale agreement,
without further Court order.
The sale of the Property is subject to Court approval. The sale of
the Property is on an "as is, where is" and "with all faults"
basis. The Trustee expressly disclaims any and all Warranties.
Finally, the Trustee asks the Court that the Order approving the
relief sought is effective upon entry, and the stay otherwise
imposed by Rule 62(a) of the Federal Rules of Civil Procedure
and/or Bankruptcy Rule 6004(h) will not apply.
Geraldine Rose Rosine sought Chapter 11 protection (Bankr. N.D.
Cal. Case No. 18-42185) on Sept. 20, 2018. The Debtor tapped Craig
V. Winslow, Esq., at Law Office of Craig V. Winslow, as counsel.
Kari Bowyer was appointed as Chapter 11 Trustee on Aug. 29, 2019.
GNC HOLDINGS: U.S. Trustee Appoints Creditors' Committee
--------------------------------------------------------
The U.S. Trustee for Region 3 on July 7 appointed a committee to
represent unsecured creditors in the Chapter 11 cases of GNC
Holdings Inc. and its affiliates.
The committee members are:
1. The Bank of New York Mellon Trust Company, N.A.
Attn: Jennifer Provenzano
500 Ross Street, 12th Floor
Pittsburgh, PA 15262
Phone: 412-236-3190
Email: Jennifer.j.Provenzano@bnymellon.com
2. Brookfield Properties Retail, Inc.
Attn: Julie Minnick Bowden
350 N. Orleans St., Suite 300
Chicago, IL 60654-1607
Phone: 312-960-2707
Fax: 312-442-6374
Email: Julie.Bowden@brookfieldpropertiesretail.com
3. Simon Property Group
Attn: Ronald Tucker
225 West Washington Street
Indianapolis, IN 46204
Phone: 317-263-2346
Fax: 317-263-7901
Email: rtucker@simon.com
4. Woodbolt Distribution, LLC
d/b/a Nutrabolt
Attn: Michael DiMaggio
4407 Monterey Oaks Blvd, Suite 150
Austin, TX 78749
Phone: 979-773-8937
Email: mdimaggio@nutrabolt.com
5. Adaptive Health
Attn: Brandon Adcock
615 S. College St., #1300
Charlotte, NC 28202
Phone: 704-557-0985
Email: brandon@adaptivehealth.com
6. Redcon1, LLC
Attn: Robert Conley
701 Park of Commerce Blvd
Boca Raton, FL 33487
Phone: 561-239-2494
Email: rconley@redcon1.com
7. Misty Fair (individual and class plaintiff)
c/o Christian Schreiber
Olivier, Schreiber & Chao LLP
201 Filbert Street, Suite 201
San Francisco, CA 94133
Phone: (415) 484-0161,
Email: christian@osclegal.com
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About GNC Holdings
GNC Holdings Inc. is a global health and wellness brand with a
diversified omni-channel business. In its stores and online, GNC
Holdings sells an assortment of performance and nutritional
supplements, vitamins, herbs and greens, health and beauty, food
and drink, and other general merchandise, featuring innovative
private-label products as well as nationally recognized third-party
brands, many of which are exclusive to GNC Holdings. Visit
www.gnc.com for more information.
GNC Holdings and its affiliates sought protection under Chapter 11
of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-11662) on
June 23, 2020. Debtors disclosed $1,415,957,000 in assets and
$895,022,000 in liabilities as of March 31, 2020.
Judge Karen B. Owens oversees the cases.
Debtors have tapped Young Conaway Stargatt & Taylor, LLP and Latham
& Watkins, LLP as legal counsel; Evercore Group, LLC as investment
banker and financial advisor; FTI Consulting, Inc. as financial
advisor; and Prime Clerk as claims and noticing agent. Torys LLP
is the legal counsel in the Companies' Creditors Arrangement Act
case.
GVM INC: Exits Chapter 11 Bankruptcy With Liquid Finance's Help
---------------------------------------------------------------
GVM Inc. of Biglerville, PA, an American manufacturer of high-end
agriculture equipment called Prowler Double Duty Spreaders and Mako
Sprayers, has exited Chapter 11 Bankruptcy in a transaction with
Liquid Finance. With the reorganization, GVM has cleaned their
balance sheet, allowing them to continue manufacturing state of the
art agriculture and snow equipment in their facilities in Ohio,
Pennsylvania, Missouri, and Indiana. Liquid Finance structured a
transaction that helps GVM grow distribution across North America.
The transaction was finalized May 28, which allowed GVM to exit
bankruptcy protection and fulfill orders for farmers and
agricultural co-ops across the USA.
"This saves American manufacturing jobs and continues GVM's
agriculture innovation which in turn helps American crop yields,"
said William Melvin, CEO of Liquid Finance. "It's pretty cool to
accomplish this in the post COVID-19 world. GVM manufacturers the
best fertilizer spreaders in the world, and this transaction allows
them to continue their growth across North America. We believe
their success could help increase food yields globally in the next
10 years, plus their snow products help state departments of
transportation reduce costs."
GVM operates locations in Pennsylvania, Ohio, Indiana, Missouri,
Georgia, Washington, and California, distributing product
throughout the US, Canada, and Australia. Their equipment provides
farmers and Agricultural retailers the highest Return on Investment
(ROI) in the market. GVM products include the Prowler, Mako, Double
Duty Twin Chain Spreader, GVM Air and T-Series Booms, and Hydra
Spreaders. GVM's industry leading Snow Anti-icing and Brine
systems save costs for State Transportation Departments across the
east coast.
"Liquid Finance is excited to assist with GVM's success. When we
met with the GVM team, we learned they had some unique challenges
ahead of them," said Melvin. "We see value and find solutions that
other finance companies struggle with. We were able to structure a
transaction that allows them to clean up their balance sheet, lower
costs, and get back on their feet to grow in the years ahead. It's
great to help save American manufacturing jobs and American
innovation. Farmers can sleep at night knowing the GVM Prowler is
keeping their crops safe."
Liquid Finance is an asset based finance company that structures
unique transactions that help companies in distress. They see
value and solutions to help companies grow. Liquid Finance helps
manufacturers, retailers, and wholesalers in distressed special
situations when they are looking for strategic alternatives. They
operate with term loans, asset based loans, sale leasebacks,
Debtor-In-Possession loans, bankruptcy exit loans, and other high
stress special situation finance. With field staff across North
America they can quickly review transactions and submit proposals
within tight timelines. Their typical deal size is $1million to
$50million.
About Liquid Finance
Liquid Finance is an asset based finance company that structures
unique transactions to help companies in distress. They see value
and solutions to help companies grow. It helps manufacturers,
retailers, and wholesalers in distressed special situations when
they are looking for strategic alternatives. They operate with
term loans, asset based loans, sale leasebacks,
Debtor-In-Possession loans, bankruptcy exit loans, and other high
stress special situation finance. With field staff across North
America they can quickly review transactions and submit proposals
within tight timelines. Their typical deal size is $1 million to
$50 million.
About GVM Inc.
GVM Inc. -- https://www.gvminc.com/ -- is a manufacturer of
agricultural application and snow equipment. Its affiliate
Independent AG Equipment, Inc., is a distributor of multiple
equipment lines and acts as separate entity from manufacturing. GVM
West, LTD is a supplier of farm equipment parts.
GVM and its affiliates sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Pa. Lead Case No. 19-03013) on July
13, 2019. The petitions were signed by Mark W. Anderson,
president.
At the time of the filing, GVM disclosed assets of between $10
million and $50 million and liabilities of the same range.
Albert A. Ciardi, III, Esq., at Ciardi Ciardi & Astin, P.C.,
represents the Debtors.
HADDINGTON FUND: Seeks Approval to Tap Scauzillo Firm as Accountant
-------------------------------------------------------------------
Haddington Fund, LP seeks approval from the U.S. Bankruptcy Court
for the Eastern District of Texas to employ The Scauzillo Firm,
PLLC as accountants.
The Debtor desires to employ The Scauzillo Firm to provide
assistance in the Debtor's filing of its tax returns in a timely
manner.
The firm will handle the preparation of the required tax returns on
a flat fee of $2,585.
The firm has not been paid a retainer.
Rick Scauzillo, an accountant with The Scauzillo Firm, PLLC,
disclosed in court filings that the firm is a "disinterested
person" as that term is defined in section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Rick Scauzillo
THE SCAUZILLO FIRM, PLLC
5900 S Lake Forest Dr., Suite 200
McKinney, TX 75070
Telephone: (972) 562-2222
Facsimile: (972) 542-7887
E-mail: rick@dfwcpas.com
About Haddington Fund
Haddington Fund L.P. filed for Chapter 11 bankruptcy protection
(Bankr. E.D. Tex. Case No. 19-42853) on Oct. 21, 2019. In its
petition, the Debtor was estimated to have $1 million to $10
million in both assets and liabilities. The petition was signed by
James Bresnahan, managing member of general partner. The Hon.
Brenda T. Rhoades oversees the case. The Debtor tapped Eric A.
Liepins, Esq., at Eric A. Liepins, P.C., as bankruptcy counsel;
Jones Allen & Fuquay, LLP, as special counsel; and The Scauzillo
Firm, PLLC as accountants.
HEART CONSULTANTS: Seeks to Hire Goren Law as Legal Counsel
-----------------------------------------------------------
Heart Consultants, LLC, seeks authority from the U.S. Bankruptcy
Court for the District of Maryland to hire Goren Law, LLC as its
legal counsel.
Goren Law will represent the Debtor in all aspects of its Chapter
11 case, including the filing of schedules, statements, and
reports, settlement negotiations, advice concerning administration
of the estate, filing of necessary motions, the bringing and
defense of any contested matters or adversary proceedings involving
Debtor in the bankruptcy court, and confirmation of the Chapter 11
plan.
The Debtor agrees to pay $10,000 as an initial retainer against an
hourly rates of $450 for attorneys and $125 for law clerks and
paralegals.
Robert Goren, Esq., at Goren Law, assures the court that he is a
"disinterested person" within the meaning of 11 U.S.C. 101(14).
The counsel can be reached at:
Robert K. Goren, Esq.
Goren Law, LLC
177 Kentlands Blvd., Suite 200
Gaithersburg, MD 20878
Phone: (301) 977 43006
Email: rgoren@gwolaw.com
About Heart Consultants
Based in Silver Spring, Maryland, Heart Consultants, LLC, sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md.
Case No. 20-16195) on June 22, 2020, listing under $1 million in
both assets and liabilities. Robert K. Goren, Esq. at GOREN LAW,
LLC, represents the Debtor as counsel.
HERTZ GLOBAL: To Issue $1 Billion Worth of New Shares
-----------------------------------------------------
Clark Schultz, writing Seeking Alpha, reports that Hertz Global
Holdings plans to issue and to sell shares worth $1 billion worth
of shares. The company asked a bankruptcy judge to approve a deal
with Jefferies to allow the potential sale of 246.8 million
unissued shares.
"The recent market prices of and the trading volumes in Hertz’s
common stock potentially present a unique opportunity for the
company to raise capital on more favorable terms than the
strings-attached loans that many other bankrupt companies get,"
stated Hertz attorneys on the strategy.
Hertz was granted approval by the U.S. Bankruptcy Court for the
District of Delaware to sell up to $1 billion in stock on June 12,
2020, according to CNBC.
About Hertz Corp.
Hertz Corp. and its subsidiaries -- http://www.hertz.com/--
operate a worldwide vehicle rental business under the Hertz,
Dollar, and Thrifty brands, with car rental locations in North
America, Europe, Latin America, Africa, Asia, Australia, the
Caribbean, the Middle East, and New Zealand. The Company also
operates a vehicle leasing and fleet management solutions
business.
On May 22, 2020, The Hertz Corporation and certain of its U.S. and
Canadian subsidiaries and affiliates filed voluntary petitions for
reorganization under Chapter 11 in the U.S. Bankruptcy Court
(Bankr. D. Del. Case No. 20-11218).
The Hon. Mary F. Walrath is the presiding judge.
White & Case LLP is serving as legal advisor, Moelis & Co. is
serving as investment banker, and FTI Consulting is serving as
financial advisor. Richards, Layton & Finger, P.A., is the local
counsel.
Prime Clerk LLC is the claims agent, maintaining the page
https://restructuring.primeclerk.com/hertz
HIGHLAND CAPITAL: Seeks Approval to Retain Services of DSI's CEO
----------------------------------------------------------------
Highland Capital Management, L.P. filed an amended application with
the U.S. Bankruptcy Court for the Northern District of Texas to
authorize Development Specialists Inc. CEO Bradley Sharp to
continue to provide financial advisory and restructuring-related
services to the company.
Mr. Sharp is Highland Capital's chief restructuring officer.
Currently, there is a pending motion to appoint James Seery Jr. of
Guggenheim Securities LLC not only as Highland Capital's chief
executive officer but also as the company's new CRO and foreign
representative.
Mr. Sharp will continue to provide the following services:
(i) assist Highland Capital in the preparation of financial
disclosures required by the court, including monthly operating
reports;
(ii) assist Highland Capital in responding to third party due
diligence requests;
(iii) monitor Highland Capital's ordinary-course operations;
(iv) attend meetings and assist in communications with Highland
Capital's secured lenders, the Office of the U.S. Trustee and other
parties;
(v) provide litigation advisory services with respect to
accounting matters, along with expert witness testimony on case
related issues;
(vi) provide general business consulting services; and
(vii) provide other financial advisory services required by
Highland Capital, including those related to the formulation of a
Chapter 11 plan.
Development Specialists' compensation would consist of (i) a flat
monthly rate of $100,000 in lieu of the $100,000 monthly fee
currently paid to the firm for payment of Mr. Sharp's services as
CRO; (ii) continued payment of the hourly rates of the firm's
additional personnel and (iii) reimbursement of work-related
expenses.
The firm can be reached through:
Bradley D. Sharp
Development Specialists, Inc.
110 East 42nd Street Suite 1818
New York, NY 10017
Phone: 1-212-425-4141
About Highland Capital Management
Highland Capital Management LP was founded by James Dondero and
Mark Okada in Dallas in 1993. Highland Capital is the world's
largest non-bank buyer of leveraged loans in 2007. It also manages
collateralized loan obligations. In March 2007, it raised $1
billion to buy distressed loans. Collateralized loan obligations
are created by bundling together loans and repackaging them into
new securities.
Highland Capital Management, L.P., sought Chapter 11 protection
(Bank. D. Del. Case No. 19-12239) on Oct. 16, 2019. Highland was
estimated to have $100 million to $500 million in assets and
liabilities as of the bankruptcy filing.
On Dec. 4, 2019, the case was transferred to the U.S. Bankruptcy
Court for the Northern District of Texas and was assigned a new
case number (Bank. N.D. Texas Case No. 19-34054).
Judge Stacey G. Jernigan is the case judge.
The Debtor's counsel is James E, O'Neill, Esq., at Pachulski Stang
Ziehl & Jones LLP. Foley & Lardner LLP, as special Texas counsel.
Kurtzman Carson Consultants LLC is the claims and noticing agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on Oct. 29, 2019. The committee tapped Sidley Austin LLP
as bankruptcy counsel; Young Conaway Stargatt & Taylor LLP as
co-counsel with Sidley Austin; and FTI Consulting, Inc. as
financial advisor.
HIGHLAND CAPITAL: Seeks Court Approval to Hire CEO, New CRO
-----------------------------------------------------------
Highland Capital Management, L.P. filed a motion seeking approval
from the U.S. Bankruptcy Court for the Northern District of Texas
to hire James Seery Jr. as chief executive officer and as the
company's new chief restructuring officer and foreign
representative effective March 15.
If granted, Bradley Sharp, president and chief executive officer of
Development Specialists, Inc., would resign as Highland Capital's
CRO.
Mr. Seery has agreed to, among other things, provide daily
leadership and direction to the company's employees on business and
restructuring matters relating to its Chapter 11 case. In that
capacity, he will direct Highland Capital's day-to-day ordinary
course operations, oversee its personnel, make management decisions
with respect to its trading operations, direct its reorganization
efforts, monetize its assets, oversee the claims objection and
resolution process, and lead the process toward the hopeful
consensual confirmation of a plan.
Mr. Seery will be compensated as follows:
Base Compensation: $150,000 per month, which shall be due and
payable at the start of each calendar month; plus
Bonus Compensation and Restructuring Fee: Subject to a
separate bankruptcy court approval, the compensation committee and
Mr. Seery have reached agreement on the payment of a restructuring
fee upon confirmation of either a case resolution plan or a
monetization vehicle plan.
The Restructuring Fee agreed to by Mr. Seery and the
compensation committee is as follows:
Case Resolution Restructuring Plan
On confirmation of any plan or reorganization or liquidation
based on resolution of a material amount of the outstanding claims
and their respective treatment, even if such plan includes (x) a
debtor/creditor trust or similar monetization and claims resolution
vehicle, (y) postconfirmation litigation of certain of the claims,
and (z) post-confirmation monetization of debtor assets:
-- $1 million on confirmation of the case resolution plan;
-- $500,000 on the effective date of the case resolution plan;
and
-- $750,000 on completion of cash or property distributions to
creditors as contemplated by the case resolution plan.
Debtor/Creditor Monetization Vehicle Restructuring Fee:
On confirmation of any plan or reorganization or liquidation
based on a debtor/creditor trust or similar asset monetization and
claims resolution vehicle that does not include agreement among the
debtor and creditors on a material amount of the outstanding claims
and their respective treatment at confirmation:
-- $500,000 on confirmation of the monetization vehicle plan;
-- $250,000 on the effective date of the monetization vehicle
plan; and
A contingent restructuring fee to be determined by the board
or oversight committee installed to oversee the implementation of
any monetization vehicle plan.
Mr. Seery can be reached at:
James P. Seery, Jr.
Guggenheim Securities LLC
330 Madison Avenue
New York, NY 10017
Phone: 1-212-739-0700
About Highland Capital Management
Highland Capital Management LP was founded by James Dondero and
Mark Okada in Dallas in 1993. Highland Capital is the world's
largest non-bank buyer of leveraged loans in 2007. It also manages
collateralized loan obligations. In March 2007, it raised $1
billion to buy distressed loans. Collateralized loan obligations
are created by bundling together loans and repackaging them into
new securities.
Highland Capital Management, L.P., sought Chapter 11 protection
(Bank. D. Del. Case No. 19-12239) on Oct. 16, 2019. Highland was
estimated to have $100 million to $500 million in assets and
liabilities as of the bankruptcy filing.
On Dec. 4, 2019, the case was transferred to the U.S. Bankruptcy
Court for the Northern District of Texas and was assigned a new
case number (Bank. N.D. Texas Case No. 19-34054).
Judge Stacey G. Jernigan is the case judge.
The Debtor's counsel is James E, O'Neill, Esq., at Pachulski Stang
Ziehl & Jones LLP. Foley & Lardner LLP, as special Texas counsel.
Kurtzman Carson Consultants LLC is the claims and noticing agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on Oct. 29, 2019. The committee tapped Sidley Austin LLP
as bankruptcy counsel; Young Conaway Stargatt & Taylor LLP as
co-counsel with Sidley Austin; and FTI Consulting, Inc. as
financial advisor.
HYTERA COMMUNICATIONS: Committee Taps Levene Neale as Counsel
-------------------------------------------------------------
The official committee of unsecured creditors of Hytera
Communications America (West) Inc. and its affiliates seeks
authority from the U.S. Bankruptcy Court for the Central District
of California to retain Levene Neale Bender Yoo & Brill LLP as its
bankruptcy counsel.
The firm's services will include:
a. advising the committee regarding the requirements of the
bankruptcy court, Bankruptcy Code, Federal Rules of Bankruptcy
Procedure and Office of the U.S. Trustee;
b. advising the committee regarding certain rights and
remedies of Debtors' bankruptcy estates and the rights, claims and
interests of creditors;
c. representing the committee in any proceeding or hearing in
the bankruptcy court involving Debtors' estates unless it is
represented in such proceeding or hearing by special counsel;
d. conducting examinations of witnesses, claimants or adverse
parties and representing the committee in any adversary proceeding
except to the extent that any such adversary proceeding is in an
area outside of Levene's expertise;
e. assisting the committee in the preparation of reports,
applications, pleadings and orders;
f. assisting the committee in evaluating the sale or
disposition of Debtors' assets;
g. evaluating the existence of any assets or causes of action
to pursue; and
h. assisting the committee in the negotiation, formulation,
preparation and confirmation of a plan of reorganization.
The firm's services will be provided mainly by David Neale, Esq.,
and Juliet Oh, Esq., who will charge $635 per hour and $595 per
hour, respectively.
Mr. Neale disclosed in court filings that his firm is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
David L. Neale, Esq.
Levene, Neale, Bender, Yoo & Brill LLP
10250 Constellation Boulevard, Suite 1700
Los Angeles, CA 90067
Tel: (310) 229-1234
Fax: (310) 229-1244
Email: dln@lnbyb.com
About Hytera Communications America
Hytera communications America (West), Inc. is a global company in
the two-way radio communications industry. It has 10 international
R&D Innovation Centers and more than 90 regional organizations
around the world. Forty percent of Hytera employees are engaged in
engineering, research, and product design. Hytera has three
manufacturing centers in China and Spain. For more information,
visit https://www.hytera.us
On May 26, 2020, Hytera sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Calif. Lead Case No. 20-11507). At
the time of the filing, Debtor had estimated assets of between $10
million and $50 million and liabilities of between $500 million and
$1 billion.
Judge Erithe A. Smith oversees the cases.
Debtors tapped Pachulski Stang Ziehl & Jones, LLP as bankruptcy
counsel; Steptoe & Johnson, LLP as corporate and special counsel;
and Imperial Capital, LLC as financial advisor.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on June 15, 2020. The committee is represented by Levene
Neale Bender Yoo & Brill, LLP.
ICE HOUSE: Seeks to Hire Stinnette Craighead as Accountant
----------------------------------------------------------
Ice House Properties, LLC seeks approval from the U.S. Bankruptcy
Court for the Western District of Virginia to hire Stinnette,
Craighead, & Golston, P.C., as accountant.
The accountant will prepare the 2018 and 2019 federal and state
income tax returns and prepare and provide a copy of any
bookkeeping entries the Debtor finds necessary in connection with
the preparation of the income tax returns.
Fees for the tax return preparation service will be billed upon
completion of the returns at $200 per hour, plus out-of-pocket
expenses.
Stinnette Craighead is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code, according to court
filings.
The accountant can be reached through:
Domitila S. Craighead
Stinnette, Craighead & Golston, PC
2117 Rosalind Ave SW
Roanoke, VA 24014
Phone: +1 540-982-5400
About Ice House Properties
Ice House Properties, LLC, a company engaged in renting and leasing
real estate properties, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Va. Case No. 20-70468) on April 30,
2020. At the time of the filing, Debtor disclosed assets of
between $1 million and $10 million and liabilities of the same
range. Magee Goldstein Lasky & Sayers, PC is Debtor's legal
counsel.
IHEARTCOMMUNICATIONS INC: Moody's Rates New $450MM Term Loan 'B1'
-----------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to
iHeartCommunications, Inc.'s proposed $450 million incremental term
loan due May 2026. iHeart's B2 Corporate Family Rating and all
other ratings remain unchanged. The outlook also remains unchanged
at negative.
The net proceeds of the $450 million non-fungible add on term loan
are expected to be used to repay the outstanding balance on the ABL
facility and add cash to the balance sheet. Pro forma leverage
increases modestly to 6.6x from 6.5x (excluding Moody's standard
lease adjustments) as of Q1 2020. iHeart will have access to an
undrawn $450 million ABL facility (subject to availability) and
approximately $742 million of pro forma cash on the balance sheet
as of Q1 2020.
Assignments:
Issuer: iHeartCommunications, Inc.
Senior Secured Bank Credit Facility, Assigned B1 (LGD3)
RATINGS RATIONALE
iHeart's B2 CFR reflects the high pro forma leverage (6.6x as of
LTM Q1 2020 excluding Moody's standard lease adjustments) as well
as Moody's projections that leverage will increase substantially in
the near term due to the impact of the coronavirus outbreak on
radio advertising revenue. The radio industry is also being
negatively affected by the shift of advertising dollars to digital
mobile and social media as well as heightened competition for
listeners from a number of digital music providers. Secular
pressures and the cyclical nature of radio advertising demand have
the potential to exert substantial pressure on EBITDA performance
over time. iHeart is expected to take aggressive cost cutting
actions to offset significant revenue declines in the near term and
will be focused on preserving liquidity until economic conditions
improve. iHeart's live event business will be disrupted by the
pandemic, but the operating expenses for live events are largely
variable and sponsorship and live events accounted for less than 6%
of revenue in 2019.
iHeart benefits from its size as the largest radio operator in the
US, geographic diversity and leading market positions in most of
the approximately 160 markets in which it operates. The
geographically diversified footprint may support performance if
some markets are less impacted by the coronavirus outbreak and not
subject to additional health restrictions. iHeart also derives
strength from its diversified service offering including the
iHeartRadio service, live events, syndicated network, podcasting
service, and data analytic services. Moody's expects iHeart's
podcasting service to be an important contributor to growth going
forward, although competition in podcasting is likely to continue
to increase going forward. iHeart has EBITDA margins above the
industry average at 25% as of LTM Q1 2020. While local advertising
revenue accounted for the vast majority of revenue historically,
national advertising has been an increasing contributor to revenue.
iHeart has an advantage in obtaining national advertising dollars
given its leading position in the industry and prior investments in
its national salesforce.
The rapid spread of the coronavirus outbreak, deteriorating global
economic outlook, low oil prices, and high asset price volatility
have created an unprecedented credit shock across a range of
sectors and regions. Moody's regards the coronavirus outbreak as a
social risk under its ESG framework, given the substantial
implications for public health and safety. Given iHeart's exposure
to the U.S. economy, the company is vulnerable to shifts in market
demand and sentiment in these unprecedented operating conditions.
A governance consideration that Moody's considers in iHeart's
credit profile is its moderate financial policy. Since emerging
from bankruptcy and separating from Clear Channel Outdoor Holdings,
Inc., iHeart has pursued a relatively conservative financial policy
and is projected to be focused on debt repayment after the impact
of the coronavirus subsides. iHeart is a publicly traded company
listed on the Nasdaq Stock Exchange.
iHeart's Speculative Grade Liquidity (SGL) rating of SGL-3 reflects
Moody's expectation of an adequate liquidity profile supported by
approximately $742 million of pro forma cash on the balance sheet
as of Q1 2020 and an undrawn $450 million ABL revolving credit
facility due in 2023 (unrated). Free cash flow will be negatively
impacted in the near term due to the economic recession driven by
the pandemic, but the significant cash balance provides sufficient
liquidity. Moody's expects iHeart to remain focused on preserving
liquidity and will look to reduce capex levels during 2020 to
between $75 and $95 million ($112 million in 2019) in addition to
significant cost reduction measures.
iHeart also has $60 million in preferred equity outstanding which
is not included in Moody's leverage calculation but raises the
potential for free cash flow or additional debt to be used to repay
the preferred over time. The ABL credit facility is subject to a
fixed charge coverage ratio of at least 1x if borrowing
availability is less than the greater of $40 million and 10% of the
aggregate commitments for two consecutive days. The term loan and
secured notes are covenant lite. Moody's projects iHeart will
remain in compliance with the ABL covenant.
The negative outlook reflects Moody's view that iHeart will
experience material declines in revenues and EBITDA in the next few
quarters due to the impact of the coronavirus outbreak on the
economy and radio advertising revenue. The outlook also
incorporates Moody's expectation for the company's debt-to-EBITDA
leverage to increase significantly and liquidity position to
deteriorate in the near term. Political advertising revenue should
support results as the election approaches at the end of 2020,
while iHeart's podcasting business will likely continue to grow in
importance.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Although unlikely in the near term, a reduction in iHeart's
leverage to well under 5x with sustained organic revenue and EBITDA
growth with stable EBITDA margins could lead to a ratings upgrade.
Free cash flow as a percentage of debt would also have to be well
above 5% with a strong liquidity position and no near-term debt
maturities.
The ratings could be downgraded if EBITDA were to decline beyond
Moody's expectation due to economic weakness or if secular
pressures in the radio industry increased such that leverage
remains above 6x for an extended period of time. A deterioration in
iHeart's liquidity position could also pressure the ratings.
iHeartCommunications, Inc. with its headquarters in San Antonio,
Texas, is the leading terrestrial radio operator in the US. In
addition, iHeart operates its iHeartRadio digital platform, live
events, syndicated network, data analytic services, and podcasting
service. iHeart emerged from Chapter 11 bankruptcy protection and
separated from Clear Channel Outdoor Holdings, Inc. in Q2 2019.
Revenue pro forma for the separation from Clear Channel Outdoor
Holdings, Inc. was approximately $3.7 billion LTM as of Q1 2020.
The principal methodology used in these ratings was Media Industry
published in June 2017.
INTERNATIONAL FOOD: Hires Modesto Bigas as Litigation Counsel
-------------------------------------------------------------
International Food Service Purchasing Group, Inc. seeks approval
from the U.S. Bankruptcy Court for the District of Puerto Rico to
employ Modesto Bigas Law Office as special counsel.
The Debtor desires to employ Modesto Bigas Law Office to represent
its interest in a complaint that it filed against Chicago Premium
Steaks, LLC, Best Chicago Meat Company, LLC, and Brandon Beavers,
Case No. 20-CV-01162.
The legal services that Modesto Bigas Law Office will render
include:
(a) advise the Debtor on its right and duties as a Plaintiff
in the Civil Action;
(b) prepare, on behalf of the Debtor, all necessary and
appropriate pleadings, motions, applications, notices, objections,
proposed orders, and other documents in connection with the Civil
Action;
(c) prepare, on behalf of the Debtor, all necessary
applications for payment of fee and costs, notices to creditors and
any and all other documents as required by the Bankruptcy Code, the
Federal Rules of Bankruptcy Procedure and the Local Bankruptcy
Rules for the District of Puerto Rico;
(d) advise the Debtor's concerns, and prepare responses to,
applications, motions, and other pleadings and papers that may be
filed in the Civil Action;
(e) advise the Debtor regarding its ability to collect and
recover monetary awards in connection with the Civil Action; and
(f) perform any and all other necessary or appropriate legal
services in connection with the Civil Action for or on behalf of
the Debtor.
The firm agreed with the Debtor to receive compensation at $250 per
hour for the services performed and to be performed, plus costs and
expenses incurred in the civil case, subject to the approval of
this Court.
Modesto Bigas Mendez and Alexandra Bigas Valedon, attorneys at
Modesto Bigas Law Office, disclosed in court filings that the firm
is a "disinterested person" as that term is defined in section
101(14) of the Bankruptcy Code.
The firm can be reached through:
Modesto Bigas Mendez, Esq.
Alexandra Bigas Valedon, Esq.
MODESTO BIGAS LAW OFFICE
P.O. Box 7462
Ponce, PR 00732-7462
Telephone: (787) 844-1444
Facsimile: (787) 842-4090
E-mail: modestobigas@yahoo.com
alexandrabigas@gmail.com
About International Food Service Purchasing
Group
International Food Service Purchasing Group Inc. is a non-profit
organization in San Juan, P.R., that provides supply chain analysis
and management services for the restaurant industry.
International Food Service filed a Chapter 11 petition (Bankr.
D.P.R. Case No. 20-01458) on March 20, 2020. In the petition signed
by Charles A. Maxwell, its president, the Debtor was estimated to
have $1 million to $10 million in both assets and liabilities.
Alexandra Bigas Valedon, Esq., at Modesto Bigas Law Office, is
Debtor's bankruptcy counsel.
INTERNATIONAL FOOD: Taps Schoeman Updike as Special Counsel
-----------------------------------------------------------
International Food Service Purchasing Group, Inc. received approval
from the U.S. Bankruptcy Court for the District of Puerto Rico to
employ Schoeman Updike Kaufman & Gerber, LLP as special counsel.
Schoeman Updike will represent Debtor and its chief executive
officer in these civil proceedings:
-- litigation filed by Flex Funding LLC against the Debtor and
its CEO Charles Maxwell, Flex Funding v. International Food Service
Purchasing Group and Charles A. Maxwell, in the Supreme Court of
the State of New York, Nassau County and
-- a complaint that the Debtor filed against Flex Funding LLC,
Express Funding Service, Kevin Kashmin (aka Kevin Mannheim),
Richard Setti and Does 1 through 100 in the New York Supreme Court,
Kings County.
Patricia O'Prey and the Schoeman firm will provide these services
in connection with the mentioned civil cases:
(a) prepare on behalf of the Debtor and its CEO all necessary
applications, motions, answer to motions and replies; reports, and
other legal documents related to the instant civil proceedings
before the courts of New York State; and
(b) perform all legal services for the Debtor and its CEO,
which may be necessary to the effective prosecution and
administration of these civil proceedings.
The attorneys and professionals designated to represent the Debtor
will be paid at these hourly rates:
Patricia O'Prey, Esq. $600
David Black, Esq. $325
Rachel Kaufman, paralegal $175
Other employees $175-$675
Patricia O'Prey, Esq., at Schoeman Updike, 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:
Patricia O'Prey, Esq.
David Black, Esq.
Rachel Kaufman, Esq.
SCHOEMAN UPDIKE KAUFMAN & GERBER LLP
551 Fifth Avenue
New York, NY 10176
Telephone: (212) 661-5030
Facsimile: (212) 687-2123
E-mail: poprey@schoeman.com
dblack@schoeman.com
rkaufman@schoeman.com
About International Food Service
Purchasing Group
International Food Service Purchasing Group Inc. is a non-profit
organization that provides supply chain analysis and management
services for the restaurant industry.
International Food Service Purchasing Group Inc., based in San
Juan, PR, filed a Chapter 11 petition (Bankr. D.P.R. Case No.
20-01458) on March 20, 2020. In the petition signed by Charles A.
Maxwell, president, the Debtor was estimated to have $1 million to
$10 million in both assets and liabilities. The Debtor tapped
Alexandra Bigas Valedon, Esq., at Modesto Bigas Law Office, as
bankruptcy counsel.
INTERSTATE FIRE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Interstate Fire Protection, Inc.
28807 Reilly Road
New Hudson, MI 48165
Business Description: Interstate Fire Protection, Inc. offers fire
sprinkler system installation services.
Chapter 11 Petition Date: July 8, 2020
Court: United States Bankruptcy Court
Eastern District of Michigan
Case No.: 20-47514
Debtor's Counsel: Mark H. Shapiro, Esq.
STEINBERG SHAPIRO & CLARK
25925 Telegraph Rd.
Suite 203
Southfield, MI 48033-2518
Tel: 248-352-4700
E-mail: shapiro@steinbergshapiro.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robert Peters, shareholder.
A copy of the petition is available for free at PacerMonitor.com
at:
https://is.gd/PgCaI6
JARCO HARVESTING: Seeks to Hire Tarbox Law as Legal Counsel
-----------------------------------------------------------
Jarco Harvesting, Inc. seeks authority from the United States
Bankruptcy Court for the Northern District of Texas to hire Tarbox
Law, P.C. as its legal counsel.
The firm's services will include:
a. preparing of all motions, notices, orders and legal papers
necessary to comply with the requisites of the US Bankruptcy Code
and Bankruptcy Rules;
b. counseling with the Debtor regarding preparation of
operating reports, motions for use of cash collateral, and
development of a Chapter 11 Plan of Reorganization;
c. advising the Debtor concerning questions arising in the
conduct of the administration of the estate and concerning the
Trustee's rights and remedies with regard to the estate's assets
and the claims of secured, preferred and unsecured creditors and
other parties in interest; and
d. assisting the Debtor with any and all sales of assets,
closings of such sales, and distribution of creditors.
Max Ralph Tarbox, Esq., the attorney who will be handling the case,
disclosed in a court filing that he has no connection with
creditors of the estate that have interests adverse to the Debtor.
The firm can be reached through:
Max Ralph Tarbox, Esq.
Tarbox Law, P.C.
2301 Broadway
Lubbock, TX 79401
Tel: (806) 686-4448
Fax: (806) 368-9785
Email: jessica@tarboxlaw.com
About Jarco Harvesting
Jarco Harvesting, Inc. is a licensed and bonded freight shipping
and trucking company running freight hauling business from Abilene,
Texas.
Jarco Harvesting, Inc. filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No.
20-10107) on June 23, 2020. In the petition signed by Richard
Wendland, president, the Debtor estimated $1 million to $10 million
in both assets and liabilities. Max R. Tarbox, Esq. at Tarbox Law,
P.C. is the Debtor's counsel.
JORTA PROPERTIES: Sale of Sunderland Property to Bigsbys Approved
-----------------------------------------------------------------
Judge Lori S. Simpson of the U.S. Bankruptcy Court for the District
of Maryland authorized Jorta Properties, LLC's sale of the real
property of the estate located at 2521 Sharon Circle, Sunderland,
Maryland to Erik and Katelynn Bigsby.
The sale is free and clear of all liens and interests thereon on
the terms described in the Motion and the contract of sale, with
such liens and interests attaching to the proceeds of sale.
The Debtor is authorized to pay at closing all ordinary, necessary
and reasonable costs of closing, including any real estate or
transfer taxes, water and sewer charges and other utility charges
without further order of the Court from the proceeds of sale.
All other net proceeds of the sale will be deposited into the
Debtor's DIP account pending further order of the Court, including
any consent order that may be submitted to the Court providing for
the payment in full of the Debtor's secured creditor 1Sharpe
Opportunity Intermediate Trust by Walnut Street Finance, LLC.
After closing the Debtor will provide Creditor proof of deposit of
the net sale proceeds into the DIP account.
About Jorta Properties
Based in Clinton, Md., Jorta Properties, LLC sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No.
20-12243) on Feb 21, 2020. At the time of the filing, the Debtor
disclosed assets of between $100,001 and $500,000 and liabilities
of the same range. William C. Johnson, Jr., Esq. is the Debtor's
legal counsel.
LAKEWAY PUBLISHERS: Hires William Foutch as Legal Counsel
---------------------------------------------------------
Lakeway Publishers, Inc. received approval from the U.S. Bankruptcy
Court for the Eastern District of Tennessee to employ William
Foutch, Esq., as its attorney.
Mr. Foutch will provide general business advice and will assist in
the projected sales of UltraNet, RAC and Lakeway Publishers of
Missouri.
The attorney will charge $175 an hour for his services and $15 an
hour for services rendered by paralegals and paraprofessionals.
Mr. Foutch assures the court that he does not hold any interest
adverse to the estate and is a disinterested person within the
meaning of Section 101(14) of the Bankruptcy Code.
Mr. Foutch holds office at:
William O. Foutch, Esq.
830 W 1st N St
Morristown, TN 37814
Phone: +1 423-587-2337
About Lakeway Publishers
Lakeway Publishers, Inc. is a multi-state publisher of newspapers,
magazines and special publications. Lakeway owns and operates
community newspapers and magazines in Tennessee, Missouri,
Virginia, and Florida. Lakeway Publishers was incorporated in 1966
and is based in Morristown, Tenn.
Lakeway Publishers, Inc., and affiliate Lakeway Publishers of
Missouri, Inc. each filed a voluntary petition under Chapter 11 of
the Bankruptcy Code (Bankr. E.D. Tenn. Lead Case No. 19-51163) on
May 31, 2019. In the petitions signed by Jack R. Fishman,
president, Lakeway Publishers, Inc., disclosed $20,884,027 in
assets and $9,245,645 in liabilities while Lakeway Publishers of
Missouri listed $7,047,972 in assets and $9,206,193 in
liabilities.
The Debtors tapped Quist, Fitzpatrick & Jarrard, PLLC, led by Ryan
E. Jarrard, as bankruptcy counsel; Burnette Dobson & Pinchak, as
special counsel; Maneke Law Group, as special counsel.
LEE HI ASSOCIATES: Seeks to Hire Stinnette Craighead as Accountant
------------------------------------------------------------------
Lee Hi Associates, LLC seeks approval from the U.S. Bankruptcy
Court for the Western District of Virginia to hire Stinnette,
Craighead, & Golston, P.C. as accountant.
The accountant will prepare the 2018 and 2019 federal and state
income tax returns and prepare and provide a copy of any
bookkeeping entries the Debtor finds necessary in connection with
the preparation of the income tax returns.
Fees for the tax return preparation service will be billed upon
completion of the returns at $200 per hour, plus out-of-pocket
expenses.
Stinnette Craighead is a "disinterested person" as defined in Sec
101(14) of the Bankruptcy Code and as required by Sec 327(a) of the
Bankruptcy Code, according to court filings.
The accountant can be reached through:
Domitila S. Craighead
Stinnette, Craighead & Golston, PC
2117 Rosalind Ave SW
Roanoke, VA 24014
Phone: +1 540-982-5400
About Lee Hi Associates
Lee Hi Associates, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Va. Case No. 20-70467) on April 30,
2020. At the time of the filing, Debtor disclosed assets of
between $1,000,001 and $10 million and liabilities of the same
range. Magee Goldstein Lasky & Sayers, PC is Debtor's legal
counsel.
LICK INDUSTRIES: Perrottas Buying Royal Oak Property for $230K
--------------------------------------------------------------
Lick Industries, LLC, asks the U.S. Bankruptcy Court for the
Eastern District of Michigan to authorize the sale of the
residential real estate commonly known as 312 East University Ave.,
Royal Oak, Michigan to Michael Perrotta and Michelle Perrotta for
$230,000, cash, subject to overbid.
The Debtor hired a realtor and marketed the Property for sale. It
has received an offer to purchase the Property from the Buyer for
the agreed purchase price pursuant to their Purchase Agreement.
The proposed purchase price of $230,000 is subject to higher
bidding at an auction to be conducted by the Debtor. It is a cash
sale.
The hired realtor Chris Pero to assist with the marketing and sale
of the Property. Mr. Pero has extensive experience selling real
estate of this nature and in that geographical area. Mr. Pero
assisted the Debtor in determining fair market value and an
appropriate listing price. He personally inspected the Property
and suggested a list price of $250,000 and readied it for listing.
His marketing efforts were thorough and comprehensive, and resulted
in considerable interest and multiple offers for the Property. The
Purchasers' offer of $230,000 represents the highest and best
received to date.
Based upon its business judgment and the advice of Mr. Pero, the
Debtor has determined that the proposed purchase price is fair and
reasonable. It is an arms'-length sale, and the proposed
Purchasers are not insiders.
Upon information and belief, and subject to final verification,
liens against the Properties consist of a mortgage with an
approximate balance of $305,665, and property taxes in the amount
of $10,422. The Purchase Agreement is subject to Bankruptcy Court
approval. The Debtor will convey the Property via its quitclaim
deed.
If a party wishes to offer a higher amount for the Properties, they
must qualify as a competitive bidder. To qualify as a competitive
bidder, such party must, on June 30, 2020 at 5:00 p.m., submit a
purchase agreement with a purchase price equal to or greater than
$230,000. and pay a deposit to the Debtor in an amount equal to or
greater than the $10,000 deposit tendered by the Purchasers, as set
forth in the Purchase Agreements. Such deposit must be in
certified funds made payable to "Osipov Bigelman, P.C. Client Trust
Account." The purchase agreement and deposit must be delivered to
the Debtor's counsel, Osipov Bigelman, P.C., no later than 5:00
p.m. on June 30, 2020.
In the event the Debtor receives qualifying bids, it will notify
all qualified bidders and hold an auction for the Property at the
offices of its attorney, 20700 Civic Center Drive, Suite 420,
Southfield, Michigan 48076, on July 7, 2020 at 10:00 a.m., at which
time qualified bidders may make higher bids. If an auction at the
described location is not possible due to extenuating
circumstances, the counsel for the Debtor will contact all
qualified bidders to make other arrangements, possibly including,
but not limited to, conducting the auction online or via telephone.
Minimum bid increments will be determined by the Debtor its
representatives at the time of the auction, after consultation with
qualified bidders. The Debtor's realtor will continue to market
the Property up to the date of auction. For additional sale
terms, one may contact the Debtor's attorney.
The Debtor asks that any stay pertaining to this sale under F.R.
Bankr.P. 6004(g) and 6006(d) be waived.
At closing, the Debtor intends to pay, to the extent fund are
available from sale proceeds, the outstanding mortgage balance,
property taxes presently due, costs of a title insurance policy,
real estate sales commissions and expenses, and other incidental
closing costs. Remaining proceeds, if any, will be held by
Debtor's counsel in its client trust account for ultimate
disposition in accordance with a confirmed plan or other order of
the Court. Any property tax or other liens will be identified
prior to closing on the sale and will transfer and attach to sale
proceeds.
A copy of the Agreement is available at
https://tinyurl.com/y7epn8b8 from PacerMonitor.com free of charge.
About Lick Industries
Lick Industries, LLC, is a Michigan Limited Liability Company in
the business of purchasing residential real estate in need of
repairs, completing such repairs, and subsequently selling the
rehabilitated real estate for a profit.
Lick Industries filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Mich. Case No. 19-51017) on July 30,
2019, estimating under $1 million in both assets and liabilities.
Yuliy Osipov, Esq., at Osipov Bigelman, P.C., represents the
Debtor.
LIP INC: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------
Three affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
LIP, Inc. (Lead Debtor) 20-03270
DBA Mellow Mushroom Vanderbilt
317 Main Street, Suite 100
Franklin, TN 37064
LIP II, Inc. 20-03271
LIP III, Inc. 20-03272
Business Description: The Debtors are Mellow Mushroom franchisees
in Davidson County and Williamson County,
Tennessee, each owned and operated by Mark
Clark. The Debtors first filed for Chapter
11 bankruptcy in September 2019, which cases
were jointly administered under the LIP,
Inc. heading (Case No. 3:19-bk-05784).
Chapter 11 Petition Date: July 7, 2020
Court: United States Bankruptcy Court
Middle District of Tennessee
Judge: Hon. Marian F. Harrison
Debtors' Counsel: Griffin S. Dunham, Esq.
R. Alex Payne, Esq.
DUNHAM HILDEBRAND, PLLC
2416 21st Avenue South, Suite 303
Nashville, Tennessee
Tel: 615.933.5850
Email: griffin@dhnashville.com
alex@dhnashville.com
LIP, Inc.'s Total Assets: $211,607
LIP, Inc.'s Total Liabilities: $3,923,230
The petitions were signed by Mark Clark, president.
A copy of LIP, Inc.'s 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/P8XPXW
LONESTAR RESOURCES: Fitch Lowers LT Issuer Default Ratings to C
---------------------------------------------------------------
Fitch Ratings has downgraded the Long-Term Issuer Default Ratings
of Lonestar Resources US, Inc. and Lonestar Resources America, Inc.
to 'C' from 'CC'. In addition, Fitch has downgraded Lonestar
Resources America, Inc.'s senior secured revolver to 'CCC'/'RR1'
from 'CCC+'/'RR1' and the senior unsecured notes were affirmed at
'C'/'RR5'.
The downgrade reflects LONE's announcement of their election not to
make the required interest payment on their 11.25% senior unsecured
notes and the consequent 30-day grace period before an event of
default takes place under the indenture governing this instrument.
KEY RATING DRIVERS
Missed Interest Payment: On July 1, 2020, LONE announced its
election not to make the approximately $14.1 million interest
payment due on that date with respect to its 11.25% senior
unsecured notes. Under the indenture governing the notes, LONE has
a 30-day grace period to make the interest payment before
triggering an event of default. The initiation of a grace or cure
period following non-payment of a material financial obligation is
indicative of the 'C' (Near Default) IDR, per Fitch's ratings
definitions.
Borrowing Base Redetermination to Reduce Liquidity: At March 31,
2020, LONE had $1.1 million in cash on the balance sheet, as of
April 6, 2020, availability under the revolver was $21.6 million.
As a result of the seriously depressed global oil price
environment, many E&Ps have experienced significant negative
borrowing base redetermination. On June 11, 2020, LONE experienced
a negative redetermination on their borrowing base to $286 million,
from $290 million. In their 2019 annual report, LONE's management
expresses substantial doubt regarding their ability to continue as
a going concern in the face of these liquidity concerns.
Financial Maintenance Covenant Breach: At Dec. 31, 2019, LONE
failed to satisfy the consolidated current ratio covenant under
their revolving credit facility, triggering an event of default.
While they received a waiver for this breach, LONE does not expect
to be able to comply with this covenant over the next 12 months.
Failure to reach an agreement with lenders or find alternative
financing to resolve (likely) future default may result in the
acceleration of revolver repayment which may cause default and
acceleration of the 11.25% senior notes due 2023. Given the extreme
headwinds posed by the COVID-19 global economic shutdown and OPEC+
supply decisions facing the energy industry, Fitch believes
alternative liquidity options such as incremental debt or equity
issuance, or asset sales are unlikely to be viable financial
alternatives.
Two-Year Hedge Coverage Supports Development: On March 12, 2020,
LONE announced their recent increases to their hedge book through
2021. With 7,452 boepd of crude oil swapped at an average price of
$57.09 per barrel and 20,000 MMBtu per day of natural gas swapped
at an average price of $2.55 per MMBtu, LONE has substantially all
of their production covered for 2020 at prices that far exceed the
current spot and strip. Further reducing their price risk, LONE has
established substantial hedges for oil (7,000 boepd at
$50.40/barrel) and natural gas (27,500 MMBtu per day at $2.36 per
MMBtu) through 2021. Fitch expects their robust hedge book to
protect LONE's development capex and internally-generated liquidity
from near-term price weakness.
DERIVATION SUMMARY
LONE is small relative to U.S. onshore E&P peers, with production
of 15.2 mboe/d at Dec. 31, 2019 compared with production of 66.8
mboe/d for Magnolia Oil & Gas Corp. (MGY; WD), 141.1 mboe/d for
Comstock Resources, Inc. (CRK; B/Positive), 80.3 mboe/d for
Extraction Oil & Gas, Inc. (XOGD), and 53.6 mboe/d for Great
Western Petroleum, LLC (GWOC; CCC-). LONE's recent historical
operational momentum and favorable well results has placed it on a
relatively strong growth trajectory, with yoy production growth of
around 35% in 2019.
LONE also has a relatively competitive cost position, achieving
unhedged cash netbacks of approximately $16.00/boe at Dec. 31,
2019, driven in a large part by strong realized prices. While below
the cash netbacks realized by GWOC ($20.80/bbl at Dec. 31, 2019),
it is in-line with XOG ($16.80/bbl at Dec. 31, 2019).
LONE experiences substantially lower financial flexibility to
peers, with more than 90% of their revolver drawn at April 6, 2020,
compared with MGY (0% revolver draw) and XOG (55% revolver draw).
This lower financial flexibility is evident in LONE's recent and
expected financial covenant breach and possible borrowing base
deficiency given sufficiently negative redetermination.
KEY ASSUMPTIONS
-- WTI prices of $32.00, $42.00, $50.00 and $52.00 per barrel in
2020, 2021, 2022 and 2023, respectively;
-- Henry Hub prices of $1.85, $2.10, $2.25 and $2.50 per Mcf in
2020, 2021, 2022 and 2023, respectively;
-- Capital spending and production growth in 2020 protected by
robust hedge coverage with capex and production flat in 2021, with
modest increase in 2022;
-- Modest reduction in revolver borrowings from proceeds of
Pirate asset sale in 2020.
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that LONE would be reorganized as a
going-concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim.
Going-Concern Approach
The GC EBITDA assumption of $100 million takes into account a
prolonged commodity price downturn (as described by Fitch's stress
price deck) causing lower than expected production and cash flow.
An Enterprise Value multiple of 3.7x EBITDA is applied to the GC
EBITDA to calculate a post-reorganization enterprise value. The
choice of this multiple considered the following factors:
The historical bankruptcy case study exits multiples for peer
companies ranged from 2.8x-7.0x, with an average of 5.6x and median
of 6.1x;
Fitch uses a multiple of 3.7x compared to the historical bankruptcy
case study exit multiple because of the company's small size and
cash flow uncertainty at Fitch's stress case price deck relative to
peers. The multiple was revised down from 4.0x in Fitch's previous
review, given increasing uncertainty about LONE's ability to
maintain operational momentum as distance to default decreases.
Liquidation Approach
The liquidation estimate reflects Fitch's view of transactional and
asset-based valuations, such as recent transactions for the Eagle
Ford basin on a $/acre basis. This data was used to determine a
reasonable sales price for the company's assets.
The company's main driver of value is its acreage in the Western
and Central regions of the Eagle Ford.
LONE also has acreage in its more prospective Eastern region, which
has been ascribed a lower valuation by Fitch.
The senior secured revolver is drawn at 100%, consistent with
current borrowings (over 90%) as of April 6, 2020, and industry
peers who have preemptively drawn the full balance.
The allocation of value in the liability waterfall results in
recovery corresponding to 'RR1' recovery for the first lien
revolver ($290 million) and a recovery corresponding to 'RR5' for
the senior unsecured notes ($250 million).
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
-- Resolution of the interest non-payment within the grace
period, without the use of as distressed debt exchange;
-- Successful refinancing/amendment of the revolving credit
facility to resolve covenant and liquidity shortfalls.
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
-- Commencement of a distressed debt exchange;
-- Announcement that the issuer has entered into bankruptcy
filings, administration, receivership, liquidation or other formal
winding-up procedure or that has otherwise ceased business.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
At March 31, 2020, LONE had $1.1 million in cash on the balance
sheet, as of April 6, 2020, availability under the revolver was
$21.6 million. As a result of the seriously depressed global oil
price environment, many E&Ps have experienced significant negative
borrowing base redetermination. On June 11, 2020, LONE experienced
a negative redetermination on their borrowing base to $286 million,
from $290 million. In their 2019 annual report, LONE's management
expresses substantial doubt regarding their ability to continue as
a going concern in the face of these liquidity concerns.
Heightened Refinancing Risk: While LONE's only maturities are
delayed until 2023, Fitch believes there is heightened event risk
that the company may look to address its liquidity position or
capital structure to alleviate their constrained financial
flexibility considering recent and expected future covenant
breaches including the missed interest payment.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
ESG CONSIDERATIONS
The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).
LONGHORN SERVICE: Seeks Approval to Tap PPL Group as Auctioneer
---------------------------------------------------------------
Longhorn Service Company, LLC seeks approval from the U.S.
Bankruptcy Court for the Western District of Oklahoma to employ PPL
Group, LLC as its auctioneer.
The Debtor desires to employ PPL Group for the purpose of
liquidating its assets, rolling stock and equipment.
PPL Group will receive a commission of 2.5%, charge a buyer's
premium of 10% for onsite sales and 13% for online sales and be
reimbursed for certain expenses.
PPL Group, LLC is a "disinterested person" as defined in section
101(14) of the Bankruptcy Code.
The firm can be reached at:
PPL GROUP, LLC
105 Revere Drive, Suite C
Northbrook, IL 60062
Telephone: (224) 927-5300
About Longhorn Service Company
Longhorn Service Company LLC is a privately held company in the
well servicing business serving oil & gas operators. Longhorn
Service was established in 1988 by Tom and Randy Holder.
Longhorn Service sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Okla. Case No. 19-14276) on Oct. 18,
2019. The petition was signed by Tom Holder, member. At the time of
the filing, the Debtor disclosed assets ranging between $10 million
to $50 million and liabilities of the same range. The Debtor is
represented by Stephen J. Moriarty, Esq. at Fellers Snider.
LUCKY STAR-DEER: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Four affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Lucky Star-Deer Park Mezz LLC 20-72403
377 Carlis Path
Deer Park, NY 11729
Flushing Landmark Realty Mezz LLC 20-72404
133-38 Sanford Avenue, Suite PHB
Flushing, NY 11355
Victoria Towers Development Mezz Corp. 20-72405
133-38 Sanford Avenue
Flushing, NY 11355
Queen Elizabeth Realty Corp. -
Business Description: The Debtors are in the business of
constructing and managing real properties.
Chapter 11 Petition Date: July 8, 2020
Court: United States Bankruptcy Court
Eastern District of New York
Judges: Hon. Robert E. Grossman (20-72403)
Hon. Louis A. Scarcella (20-72404)
Hon. Robert E Grossman (20-72405)
Debtors' Counsel: Mark A. Pergament, Esq.
WEINBERG, GROSS & PERGAMENT, LLP
400 Garden City Plaza, Suite 403
Garden City, NY 11530
Tel: (516) 877-2424
E-mail: mpergament@wgplaw.com
Lucky Star-Deer Park'
Estimated Assets: $0 to $50,000
Lucky Star-Deer Park's
Estimated Liabilities: $10 million to $50 million
Flushing Landmark Realty's
Estimated Assets: $0 to $50,000
Flushing Landmark Realty's
Estimated Liabilities: $10 million to $50 million
Victoria Towers Development's
Estimated Assets: $0 to $50,000
Victoria Towers Development's
Estimated Liabilities: $10 million to $50 million
The petitions were signed by Myint Kyaw, member.
The Debtors stated they have no unsecured creditors.
Copies of the petitions are available for free at PacerMonitor.com
at:
https://is.gd/sDxJ2r
https://is.gd/gTAxKp
https://is.gd/PFpQRE
LVI INTERMEDIATE: Sets Bid Procedures for Substantially All Assets
------------------------------------------------------------------
LVI Intermediate Holdings, Inc., and its affiliates ask 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.
In August 2019, the Debtors retained Raymond James & Associates,
Inc., a leading investment banking firm specializing in mergers and
acquisitions, debt and equity placements and financial
restructuring. Since August 2019, Raymond James has been working
closely with the Debtors and their professionals to locate
investors or purchasers, to assist in the evaluation of strategic
alternatives, including the sale of the Debtors’ Assets, or other
alternatives, such as the closure of certain business locations.
On April 23, 2020, the Company's board of directors approved the
Company's commencement of a robust marketing outreach for a sale of
the Debtors' Assets. On April 28, 2020, Raymond James launched the
Debtors' marketing process to third parties. Raymond James and/or
the Debtors contacted approximately 39 potential strategic buyers
and 96 financial buyers. To date, of the 135 parties contacted, 43
of the parties remain actively interested in the process, and an
additional 10 confidentiality agreements are in process, including
interest from both strategic and financial buyers. Thus, the
Debtors are encouraged by the interest in a sale transaction from
prospective third-party buyers.
Under the terms of the DIP Financing arrangement, the Debtors are
required to meet certain "milestones" in connection with a sale of
the Assets. The Sale Milestones contemplate the Debtors pursuing a
sale of the Assets on a going concern basis. In accordance with
the Sale Milestones, the Debtors are required to (i) complete an
auction by July 13, 2020, (ii) obtain entry of the Sale Order
approving the Sale of the Debtors' Assets by July 28, 2020, and
(iii) consummate the Sale by Aug. 12, 2020.
Accordingly, the Debtors' proposed timeline is to conduct the Sale
Hearing on during the omnibus hearing scheduled for July 28, 2020,
with other related proposed dates, as set forth:
a. Bid Procedures Objection Deadline - June 18, 2020 at 4:00
p.m.
b. Bid Procedures Hearing - June 25, 2020 at 2:30 p.m.
c. Deadline for Debtors to file and serve Assumption and
Assignment Notice - Three business days after entry of the Bid
Procedures Order
d. Bid Deadline - July 10, 2020 at 4:00 p.m.
e. Auction, if necessary - July 13, 2020 at 9:30 a.m
f. Sale Objection Deadline - July 21, 2020 at 4:00 p.m.
g. Deadline to Object to Adequate Assurance - July 28, 2020 at
4:00 p.m. (at Sale Hearing)
h. Sale Hearing - July 28, 2020 at 1:00 p.m.
i. Deadline to Close Sale - Aug. 12, 2020
The Debtors anticipate continuing in a comprehensive post-petition
marketing process for the going concern sale of the Assets with the
assistance of Raymond James and believe that the proposed Bid
Procedures are designed to permit the Debtors to consider all
available
transactions to maximize the value of the Debtors’ assets for the
benefit of their estates.
Pursuant to the Bid Procedures, the Debtors will consider bids to
acquire the Assets or separate bids to acquire certain subsets of
Assets, to the extent that the consummation of such transactions,
on the whole, maximizes value for stakeholders and can be
accomplished efficiently.
The salient terms of the Bidding Procedures are:
a. Initial Bid: $27.5 million
b. Deposit: 10% of the cash purchase price set forth in the
Written Offer
c. Maximum Expense Reimbursement: $500,000
d. Credit Bidding: The Prepetition Senior Agent, DIP Agent, or
an Agent Entity may satisfy the minimum bid increment requirement
by credit bidding or the assumption or otherwise satisfaction of
DIP Obligations or Prepetition Obligations, as applicable.
e. The Debtors select one or more bids Stalking Horse Bid(s)
of any Stalking Horse Bidder(s) to serve as the Stalking Horse
Bid(s)
f. Auction: If the Debtors determine that there are two or
more Qualified Bidders, the Debtors will conduct an Auction to
determine the highest and otherwise best Qualified Bid. The Auction
will commence at 9:30 a.m. (ET) on July 13, 2020, at the offices of
Cole Schotz P.C., 500 Delaware Avenue, Suite 1410, Wilmington, DE
19801, or such other place as determined by the Debtors, and
continue thereafter until completed. The Debtors reserve the right
to cancel or postpone the Auction. They reserve the right to not
proceed with any Sale.
g. Bid Increments: $100,000
Within three business days after entry of the Bid Procedures Order,
the Debtors propose to serve the Bid Procedures Order and the
Notice of Bid Procedures, Auction Date and Sale Hearing, upon the
Notice Parties. In addition, the Debtors' claims and noticing
agent will post a copy of the Bid Procedures Order, the Bid
Procedures and the Notice of Bid Procedures, Auction Date, and Sale
Hearing to the website that it maintains for the Debtors in these
Chapter 11 Cases (https://www.donlinrecano.com/lvi).
Within seven business days after entry of the Bid Procedures Order,
subject to applicable submission deadlines, the Debtors will
publish an abbreviated version of the Notice of Bid Procedures,
Auction Date and Sale Hearing once in one or more national
publications that the Debtors, in their business judgment, deem
appropriate.
As part of the sale of the Assets, the Debtors ask authority to
assume and assign certain contracts and leases following the
Auction, if any. Within five days after entry of the Bid
Procedures Order, the Debtors will serve the Notice of Assumption
and Assignment on all non-debtor parties to the Assumed Contracts,
and their counsel, if known. The Contract Objection Deadline
is July 15, 2020 at 4:00 p.m. for any Assumed Contract listed in
the Notice of Assumption and Assignment or within 10 days of
receipt of a Supplemental Notice of Assumption and Assignment for
any Assumed Contract set forth in a Supplemental Notice of
Assumption and Assignment.
By the Motion, the Debtors ask entry of the Bidding Procedures
Order, (i) authorizing and approving the proposed Bid Procedures,
(ii) establishing procedures the Assumption and Assignment
Procedures in connection with the proposed assumption and
assignment of certain executory contracts and unexpired leases,
(iii) approving notice procedures relating to the foregoing, and
(iv) granting related relief.
They further ask entry of the Sale Order authorizing and approving
(i) the sale of the Assets to the Successful Bidder (defined below)
free and clear of Interests, (ii) the assumption and assignment of
the Assumed Contracts in connection with the proposed Sale; (iii)
waiving the 14-day stay requirements of Bankruptcy Rules 6004(h)
and 6006(d); and (iv) granting related relief.
A copy of the Bidding Procedures is available at
https://tinyurl.com/ybfn55zj from PacerMonitor.com free of charge.
About LVI Intermediate Holdings
Headquartered in West Palm Beach, Fla., LVI Intermediate Holdings
(doing business as Vision Group Holdings) develops and manages
through its various subsidiaries two of the leading LASIK surgery
brands in the United States: The LASIK Vision Institute and TLC
Laser Eye Centers. It also owns and manages certain select general
ophthalmology practices and QuaslightLasik, a licensed Preferred
Provider Organization for LASIK surgery providers.
LVI Intermediate Holdings, Inc. and its affiliates filed Chapter 11
petitions (Bankr. D. Del. Lead Case No. 20-11413) on May 29, 2020.
The Hon. Karen B. Owens oversees the cases.
In the petition signed by Lisa Melamed, interim chief executive
officer, the Debtors were estimated to have $1 million to $10
million
in assets and $100 million to $500 million in liabilities.
The Debtors tapped Cole Schotz P.C. as counsel; Alvarez & Marsal
Capital as financial advisor; Raymond James & Associates, Inc., as
investment banker; and Donlin Recano & Company, Inc. as claims and
noticing agent.
LVI INTERMEDIATE: Sets Sale Procedures for Miscellaneous Assets
---------------------------------------------------------------
LVI Intermediate Holdings, Inc., and its affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to authorize the
procedures for the sale and/or assignment of certain of their
Miscellaneous Assets outside the ordinary course of business, free
and clear of all liens, claims, interests and encumbrances.
The Debtors lease retail space for their LASIK clinics in various
locations throughout the United States. As of the Petition Date,
the Debtors were party to approximately 115 real property leases
across 38 states. While the Company continues to implement its
post-COVID reopening plan, there are approximately 40 clinics that
the Company does not plan to reopen. The Company is in various
stages of transitioning its furniture, fixtures, supplies,
equipment and other miscellaneous personal property ("Miscellaneous
Assets") out of the permanently closed locations.
To the extent there is a business need and is practicable, the
Company is transitioning the Miscellaneous Assets for use at other
clinic locations or will move the assets into its corporate
warehouse facility in Florida or other storage. As of the Petition
Date, the Company had already fully vacated its Miscellaneous
Assets from approximately 20 clinics and either reabsorbed those
assets into other clinic locations or moved them into storage.
The Company is diligently working to transition Miscellaneous
Assets out of the remaining, approximately 20 center locations that
are not reopening. It intends to vacate from these premises as
expeditiously as possible to avoid the continued accrual of
post-petition
lease obligations associated with the Debtors' occupancy therein.
The Company, however, has reached storage capacity at is Florida
warehouse and does not have a need for all the Miscellaneous Assets
at its other clinics, though certain of the Miscellaneous Assets
are otherwise valuable. Indeed, even outside of the context of
these bankruptcy cases, the Company historically would sell certain
Miscellaneous Assets in connection with the closing of a clinic
location.
Given the publicity of the Debtors' bankruptcy filings, the Company
has received, and continues to receive, numerous expressions of
interest and inquiries from buyers regarding the purchase of
certain of Miscellaneous Assets. The purchase inquires come from
various medical facilities throughout the country, liquidators, or
other third-party buyers. Moreover, the Company has received
several serious inquiries from doctors and/or medical practices for
the purchase of excimer lasers ("Alcon Lasers") that the Company
owns subject to its master capital lease agreement with Alcon
Laboratories, Inc.
The expeditious sale and/or assignment of certain Miscellaneous
Assets, including Alcon lasers, to third party buyers provides an
enormous benefit to the Debtors and their estates. Among other
benefits, the sales would allow the Debtors to (a) obtain cash
consideration for valuable Miscellaneous Assets (other than Alcon
Lasers) they otherwise have no use for; (b) potentially save
substantial administrative rent expenses by allowing them to vacate
closed centers sooner and less expensively, given that buyers
typically pay for their own transport costs; (c) save storage costs
and needed space in the Debtors’ corporate Warehouse; and (d)
with respect to the Alcon Laser sales, eliminate the Company’s
lease liability with respect to lasers it does not need and foster
and facilitate the Debtors' relationship with one of its most
important vendors.
In the exercise of their sound business judgment, the Debtors have
determined that the prompt sale of the Miscellaneous Assets,
without the need for further notice, motions, hearings and
subsequent Court approval, subject to certain procedures, is in the
best interest of the Debtors’ stakeholders, and will enable them
to maximize the value of the Miscellaneous Assets.
In connection with the sale of the Miscellaneous Assets, the
Debtors ask authorization to sell such Miscellaneous Assets
pursuant to the Miscellaneous Asset Sale Procedures:
a) With respect to the sale and/or assignment of Miscellaneous
Assets other than Alcon Lasers (the sale of Alcon Lasers will be
governed by subsection (b)), if the sale consideration from a
purchaser and/or assignee (as applicable) of the Miscellaneous
Assets, does not exceed $100,000, on a per-transaction basis, and
if the sale is not to an insider, the Debtors may sell the assets
upon providing written notice, to the Notice Parties, which will
have three business days (unless extended by agreement from the
Debtors) from the date of such notice to inform the Debtors in
writing that they object to the proposed sale described; provided,
however, if the Proposed Miscellaneous Assets Sale exceeds
$100,000, on a per-transaction basis, or if the sale is to an
insider, then the notice of such sale will be governed by
subsection (b).
b) With the respect to the sale and/or assignment of Alcon
Lasers (or Miscellaneous Assets that fall outside the parameters of
subsection (a)), the Debtors will file with the Court a the
Miscellaneous Asset Sale Notice and serve such Miscellaneous Asset
Sale Notice to the Rule 2002 Parties.
c) The Notice Parties and the Rule 2002 Parties will have
seven business days (unless extended by agreement from the Debtors)
after the Miscellaneous Asset Sale Notice is filed and served to
advise counsel to the Debtors in writing with specific and
particular bases that they object to the Proposed Miscellaneous
Asset Sale described in such Miscellaneous Asset Sale Notice. If
no written objection is received by the Objection Deadline, the
Debtors may consummate the Proposed Miscellaneous Asset Sale,
without further notice to any other party and without the need for
a hearing, upon entry of an order of the Court submitted under
certification of counsel in accordance with these procedures, and
upon entry of such order, such Proposed Miscellaneous Asset Sale
will be deemed fully authorized by the Court.
d) If a written objection to a Proposed Miscellaneous Asset
Sale is timely received by the Objection Deadline, the Debtors will
not proceed with the Proposed Miscellaneous Asset Sale unless: (i)
the objection is withdrawn or otherwise resolved; or (ii) the Court
approves the Proposed Miscellaneous Asset Sale at the next
regularly scheduled omnibus hearing in the or at the next omnibus
hearing in the Chapter 11 Cases that is agreed to by the objecting
party and the Debtors.
e) All buyers will acquire the Miscellaneous Assets sold by
the Debtors pursuant to these Miscellaneous Asset Sale Procedures
on an "as is-where is" basis without any representations or
warranties; provided, however, that buyers will take title to the
Miscellaneous Assets free and clear of all liens, claims,
encumbrances and other interests, with all such liens, claims,
encumbrances and other interests, if any, to attach to the proceeds
of the sale of the Miscellaneous Assets.
f) Good faith purchasers of the Miscellaneous Assets will be
entitled to the protections of section 363(m) of the Bankruptcy
Code.
g) The absence of a timely objection to the sale of the
Miscellaneous Assets in accordance with the Miscellaneous Asset
Sale Procedures will be "consent" to such sale within the meaning
of section 363(f)(2) of the Bankruptcy Code.
The Debtors anticipate that the proposed sales may require them to
dispose of executory contracts that are related to the
Miscellaneous Assets to be sold. Furthermore, they will ask to
assume and assignee the Alcon leases with Alcon's consent.
It is in the best interests of the Debtors' estates to facilitate
the closing of these sale transactions, thereby expediting the
receipt of related sale proceeds into the estates. Moreover, the
often difficult task of securing a buyer will be facilitated by the
Debtors' ability to quickly consummate a sale transaction.
Accordingly, the Debtors submit that the 14-day stay set forth in
Bankruptcy Rules 6004(h) and 6006(d) should be waived with respect
to the Proposed Order and in connection with all sales of
Miscellaneous Assets pursuant to the Miscellaneous Asset Sale
Procedures.
About LVI Intermediate Holdings
Headquartered in West Palm Beach, Fla., LVI Intermediate Holdings
(doing business as Vision Group Holdings) develops and manages
through its various subsidiaries two of the leading LASIK surgery
brands in the United States: The LASIK Vision Institute and TLC
Laser Eye Centers. It also owns and manages certain select general
ophthalmology practices and QuaslightLasik, a licensed Preferred
Provider Organization for LASIK surgery providers.
LVI Intermediate Holdings, Inc. and its affiliates filed Chapter
11
petitions (Bankr. D. Del. Lead Case No. 20-11413) on May 29, 2020.
The Hon. Karen B. Owens oversees the cases.
In the petition signed by Lisa Melamed, interim chief executive
officer, the Debtors were estimated to have $1 million to $10
million in assets and $100 million to $500 million in liabilities.
The Debtors tapped Cole Schotz P.C. as counsel; Alvarez & Marsal
Capital as financial advisor; Raymond James & Associates, Inc., as
investment banker; and Donlin Recano & Company, Inc., as claims and
noticing agent.
MANOMAY LLC: Trustee Hires Natalie Lutz Cardiello as Counsel
------------------------------------------------------------
Natalie Lutz Cardiello, the Chapter 11 trustee for Manomay, LLC,
received approval from the U.S. Bankruptcy Court for the Western
District of Pennsylvania to hire her own firm as her legal counsel
in Debtor's Chapter 11 case.
The Law Offices of Natalie Lutz Cardiello will provide the
following services:
(a) furnish information on legal matters in view of possible
legal actions;
(b) recover assets through possible legal actions and
negotiating in the context of said actions;
(c) review and validate claims; and
(d) prepare legal documents and attending hearings.
The law firm will charge $350 per hour for its services.
Ms. Cardiello assures the court that her firm is a "disinterested
party" within the meaning of 11 U.S.C. Sec. 101(14).
The firm can be reached through:
Natalie Lutz Cardiello, Esq.
Law Offices of Natalie Lutz Cardiello
107 Huron Drive
Carnegie, PA 15106
Phone: (412) 276 4043
Email: ncardiello-law.com
About Manomay LLC
Based in Altamonte Springs, Fla., Manomay LLC filed a voluntary
petition under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla.
Case No. 19-24450) on Nov. 14, 2019. At the time of the filing, the
Debtor disclosed assets of between $1 million and $10 million and
liabilities of the same range. Judge Carlota M. Bohm oversees the
case.
Robert O Lampl Law Office is the Debtor's legal counsel.
Natalie Lutz Cardiello was appointed as Debtor's Chapter 11
trustee. The trustee is represented by the Law Offices of Natalie
Lutz Cardiello.
METAL PARTNERS: Hires Larson & Zirzow as Co-Counsel
---------------------------------------------------
Metal Partners Rebar, LLC and its debtor affiliates seek approval
from the U.S. Bankruptcy Court for the District of Nevada to employ
Larson & Zirzow, LLC as general reorganization co-counsel.
Larson & Zirzow will render the following professional services:
(a) advising the Debtors with respect to their powers and
duties as debtors-in-possession in the continued management and
operation of their business;
(b) advising and consulting on the conduct of these chapter 11
cases including all of the legal and administrative requirements of
operating in chapter 11;
(c) attending meetings and negotiating with representatives of
creditors and other parties-in-interest;
(d) taking all necessary actions to protect and preserve the
Debtors' estates;
(e) preparing pleadings in connection with these chapter 11
cases;
(f) representing the Debtors in connection with obtaining
authority to continue using cash collateral and post-petition
financing;
(g) advising the Debtors in connection with any potential sale
of assets;
(h) appearing before the Court and any appellate courts to
represent the interests of the Debtors' estates;
(i) taking any necessary action on behalf of the Debtors to
negotiate, prepare, and obtain approval of a disclosure statement
and confirmation of a chapter 11 plan and all documents related
thereto; and
(j) performing all other necessary legal services for the
Debtors in connection with the prosecution of these chapter 11
cases.
Larson & Zirzow will coordinate with Debtors' co-counsel Saul Ewing
Arnstein & Lehr LLP to avoid any duplication of services.
The hourly rates of the firm's professionals who will primarily
work on this matter are below:
Matthew C. Zirzow, Esq. $550
Patricia Huelsman $220
Debtors and Larson & Zirzow agreed to an evergreen retainer
arrangement in the amount of $25,000.00 for pre-petition work.
Prior to the filing of the petitions, Larson & Zirzow billed and
was paid the total sum of $80,580.16 for fees and expenses incurred
prior to the Petition Date, inclusive of the filing fees for these
Chapter 11 Cases.
Additionally, in the lead up to the Debtors' bankruptcy filings the
parties agreed that the firm would receive an additional retainer
in the sum of $100,000.00. The balance of the evergreen retainer in
the amount of $21,322 plus the additional retainer, the firm
retains a balance of $121,332.00 in its trust account to secure the
payment of future post-petition fees and costs as may be allowed by
the Court, subject to normal fee application allowance process and
other orders of the Court.
Larson & Zirzow, LLC and its individual attorneys are
"disinterested persons" pursuant to sections 327(a) and 101(14) of
the Bankruptcy Code.
The firm can be reached through:
Zachariah Larson, Esq.
Matthew C. Zirzow, Esq.
LARSON & ZIRZOW, LLC
850 E. Bonneville Ave.
Las Vegas, NV 89101
Telephone: (702) 382-1170
Facsimile: (702) 382-1169
E-mail: zlarson@lzlawnv.com
mzirzow@lzlawnv.com
About Metal Partners Rebar
Metal Partners Rebar, LLC and four affiliates concurrently filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Nev. Lead Case No. 20-12878) on June 16, 2020. The
petitions were signed by Joseph Tedesco, chief financial officer.
At the time of the filing, Metal Partners Rebar, LLC disclosed
estimated assets of $10 million to $50 million and estimated
liabilities of $50 million to $100 million; BGD LV Holding, LLC
disclosed estimated assets of $0 to $50,000 and estimated
liabilities of the same range; BRG Holding, LLC disclosed estimated
assets of $1 million to $10 million and estimated liabilities of
$10 million to $50 million; and BCG Ownco, LLC disclosed estimated
assets of $1 million to $10 million and estimated liabilities of
$10 million to $50 million.
Hon. Mike K. Nakagawa oversees the cases.
Debtors tapped Saul Ewing Arnstein & Lehr LLP as their bankruptcy
counsel; Larson & Zirzow, LLC as general reorganization co-counsel;
High Ridge Partners, LLC as financial advisor; and SSG Advisors,
LLC as investment banker.
METAL PARTNERS: Seeks to Hire High Ridge as Financial Advisor
-------------------------------------------------------------
Metal Partners Rebar, LLC and its debtor-affiliates seek authority
from the United States Bankruptcy Court for the District of Nevada
to employ High Ridge Partners, LLC as financial advisors.
The firm will provide the following services:
a. conduct site visits to gather relevant information, meet
with management, and review aspects of the operations in order to
become more familiar with the business;
b. review and revise the thirteen-week cash flow forecast
while identifying immediate opportunities for efficiencies and
expense rationalization;
c. advise on various issues which would focus on immediate
improvements in liquidity and cash flow; and
d. advise on various issues which would focus on restructuring
initiatives and secured lender correspondence.
High Ridge's hourly rates are:
Michael J. Eber $450
Managing Directors $380
Associates $295
Michael J. Eber, a principal at High Ridge, assures the court that
the firm is a "disinterested person" pursuant to sections 327(a)
and 101(14) of the Bankruptcy Code.
The firm can be reached through:
Michael J. Eber, Esq.
High Ridge Partners, LLC
140 S Dearborn St.
Chicago, IL 60603
Phone: +1 312-456-5636
About Metal Partners Rebar
Metal Partners Rebar, LLC and its affiliates are rebar fabricators
and distributors, offering steel and epoxy coated rebar, wire mesh,
and dowel bars with custom fabrication and value-added services.
Metal Partners Rebar and its affiliates concurrently filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Nev. Lead Case No. 20-12878) on June 16, 2020. The
petitions were signed by Joseph Tedesco, chief financial officer.
At the time of filing, Metal Partners Rebar estimated $10 million
to $50 million in assets and $50 million to $100 million in
liabilities. The Debtors are represented by Matthew C. Zirzow, Esq.
at Larson & Zirzow, LLC.
METAL PARTNERS: Taps Saul Ewing as Legal Counsel
------------------------------------------------
Metal Partners Rebar, LLC and its debtor affiliates seek approval
from the U.S. Bankruptcy Court for the District of Nevada to employ
Saul Ewing Arnstein & Lehr LLP as their bankruptcy counsel.
Saul Ewing Arnstein & Lehr will render the following professional
services to the Debtors:
(a) providing legal advice with respect to the Debtors' powers
and duties as debtors-in-possession in the management of their
assets;
(b) providing legal advice with respect to the Debtors'
obligations to their landlords, creditors, taxing bodies and other
government agencies;
(c) negotiations with the Debtors' creditors and preparing
responses to all documents filed by the creditors;
(d) providing legal advice with respect to a Section 363 sale
of the Debtors' assets on a going concern bases;
(e) pursuing confirmation of a plan and approval of a
disclosure statement;
(f) preparing, on behalf of the Debtors, all necessary
applications, motions, answers, orders, reports and other legal
papers as required by applicable bankruptcy or non-bankruptcy law,
as dictated by the demands of the cases, or as required by the
Court, and representing the Debtors in any hearings or proceedings
related thereto;
(g) appearing in Court and protecting the interests of the
Debtors before the Court; and
(h) performing all other legal services for the Debtors which
may be necessary and proper in these cases.
Saul Ewing Arnstein & Lehr has advised the Debtors that the hourly
rates applicable to the principal attorneys proposed to represent
the Debtors are as follows:
Michael L. Gesas $745
David A. Golin $650
Konstantinos Armiros $670
Eugene Geekie $695
Christopher S. Naveja $560
Prior to the commencement of the Debtors' chapter 11 cases, Saul
Ewing Arnstein & Lehr received weekly payments from Debtor Metal
Partners Rebar, LLC for services rendered to the Debtors and costs
incurred during the week, or so, ending on the day prior to invoice
date. These payments aggregated $957,493.00. These payments were
made in the ordinary course of business of the Debtors and Saul
Ewing Arnstein & Lehr.
Prior to the commencement of the Debtors' Chapter 11 Cases, Saul
Ewing Arnstein & Lehr received two retainer payments from Metal
Partners Rebar, LLC, on behalf of all of the Debtors, in the total
amount of $255,000. The bankruptcy retainer is held by Saul Ewing
Arnstein & Lehr as an advance payment retainer for services to be
rendered to the Debtors in the Chapter 11 Cases. The retainer was
placed in one of Saul Ewing Arnstein & Lehr's general bank
accounts.
On June 15 and June 16, 2020, Saul Ewing Arnstein & Lehr rendered
services to the Debtors in preparation for the filing of the
chapter 11 petitions and certain emergency motions. The fees for
such services were approximately $32,563.94. The firm intends to
request compensation for such services in these Chapter 11 Cases to
be paid from the retainer.
Saul Ewing Arnstein & Lehr, LLC is a "disinterested person" as such
term is defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Michael L. Gesas, Esq.
David A. Golin, Esq.
SAUL EWING ARNSTEIN & LEHR LLP
161 North Clark St., Suite 4200
Chicago, IL 60601
Telephone: (312) 876-7100
Facsimile: (312) 876-0288
E-mail: michael.gesas@saul.com
david.golin@saul.com
About Metal Partners Rebar
Metal Partners Rebar, LLC and four affiliates concurrently filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Nev. Lead Case No. 20-12878) on June 16, 2020. The
petitions were signed by Joseph Tedesco, chief financial officer.
At the time of the filing, Metal Partners Rebar, LLC disclosed
estimated assets of $10 million to $50 million and estimated
liabilities of $50 million to $100 million; BGD LV Holding, LLC
disclosed estimated assets of $0 to $50,000 and estimated
liabilities of the same range; BRG Holding, LLC disclosed estimated
assets of $1 million to $10 million and estimated liabilities of
$10 million to $50 million; and BCG Ownco, LLC disclosed estimated
assets of $1 million to $10 million and estimated liabilities of
$10 million to $50 million.
Hon. Mike K. Nakagawa oversees the cases.
Debtors tapped Saul Ewing Arnstein & Lehr LLP as their bankruptcy
counsel; Larson & Zirzow, LLC as general reorganization co-counsel;
High Ridge Partners, LLC as financial advisor; and SSG Advisors,
LLC as investment banker.
METAL PARTNERS: Taps SSG Advisors as Investment Banker
------------------------------------------------------
Metal Partners Rebar, LLC and its debtor affiliates seek approval
from the U.S. Bankruptcy Court for the District of Nevada to employ
SSG Advisors, LLC as their investment banker.
SSG Advisors will render the following investment banking services
in connection with an acquisition transaction for all or part of
the Debtors' business:
(a) prepare an information memorandum describing the Debtors,
its subsidiaries that can be sold as independent business units,
its historical performance and prospects, including existing
contracts, marketing and sales, labor force, management, and
financial projections;
(b) assist the Debtors in compiling a data room of any
necessary and appropriate documents related to the Sale;
(c) assist the Debtors in developing a list of suitable
potential buyers who will be contacted on a discreet and
confidential basis after approval by the Debtors;
(d) coordinate the execution of confidentiality agreements for
potential buyers wishing to review the information memorandum;
(e) assist the Debtors in coordinating site visits for
interested buyers and work with the management team to develop
appropriate presentations for such visits;
(f) solicit competitive offers from potential buyers;
(g) advise and assist the Debtors in structuring the Sale and
negotiating the transaction agreements;
(h) be available for meetings and any necessary court
appearances; and
(i) otherwise assist the Debtors and its other professionals,
as necessary, through closing on a best efforts basis.
The Debtors believe that the services will not duplicate the
services that the Debtors' other professionals will be providing in
the Chapter 11 Cases.
The Debtors have agreed to pay SSG as follows:
(a) Initial Fee: An initial fee equal to $25,000 due upon
signing the Engagement Agreement.
(b) Monthly Fees: Monthly fees of $25,000 per month payable
beginning June 1, 2020 and on the first of each month thereafter
throughout the Engagement Term. The Engagement Term shall be for a
period of four (4) months and may thereafter be terminated by
either party upon thirty (30) days prior written notice to the
other; provided, however, that either party may terminate the
Engagement Agreement by written notice immediately following the
closing of a Sale.
(c) Sale Fee: Upon the Closing of a Sale to any party, SSG
shall be entitled to a fee, payable in cash, in federal funds via
wire transfer or certified check, at and as a condition of closing
of such Sale, equal to $400,000. In the event that SSG is entitled
to a Sale Fee of $400,000, then SSG shall credit fifty (50%)
percent of its Initial and Monthly Fees against such Sale Fee.
Notwithstanding the foregoing, in the event of a Sale to any entity
owned or controlled by Jose Carrero, any of his family members or
his designee, without a qualified third party overbid, SSG shall be
entitled to a Sale Fee of $250,000.
(d) Expenses: In addition to the foregoing Initial Fee,
Monthly Fee and Sale Fee noted above, SSG will be entitled to
reimbursement for all of SSG's reasonable documented out-of-pocket
expenses incurred in connection with the subject matter of this
Engagement Agreement, whether or not a Sale is consummated.
SSG Advisors, LLC is a "disinterested person," as such term is
defined in section 101(14) of the Bankruptcy Code, as modified by
section 1107(b) of the Bankruptcy Code, and, as required by section
327(a) and referenced by section 328(c) of the Bankruptcy Code.
The firm can be reached through:
J. Scott Victor
SSG ADVISORS, LLC
300 Barr Harbor Drive, Suite 420
West Conshohocken, PA 19428
Telephone: (610) 940-1094
Facsimile: (610) 940-4719
E-mail: jsvictor@ssgca.com
About Metal Partners Rebar
Metal Partners Rebar, LLC and four affiliates concurrently filed
voluntary petitions for relief under Chapter 11 of the Bankruptcy
Code (Bankr. D. Nev. Lead Case No. 20-12878) on June 16, 2020. The
petitions were signed by Joseph Tedesco, chief financial officer.
At the time of the filing, Metal Partners Rebar, LLC disclosed
estimated assets of $10 million to $50 million and estimated
liabilities of $50 million to $100 million; BGD LV Holding, LLC
disclosed estimated assets of $0 to $50,000 and estimated
liabilities of the same range; BRG Holding, LLC disclosed estimated
assets of $1 million to $10 million and estimated liabilities of
$10 million to $50 million; and BCG Ownco, LLC disclosed estimated
assets of $1 million to $10 million and estimated liabilities of
$10 million to $50 million.
Hon. Mike K. Nakagawa oversees the cases.
Debtors tapped Saul Ewing Arnstein & Lehr LLP as their bankruptcy
counsel; Larson & Zirzow, LLC as general reorganization co-counsel;
High Ridge Partners, LLC as financial advisor; and SSG Advisors,
LLC as investment banker.
MEZZ57TH LLC: Seeks to Hire Golden Door Services as Consultant
--------------------------------------------------------------
Mezz57th LLC and its debtor-affiliates seek authority from the U.S.
Bankruptcy Court for the Southern District of New York to employ
Golden Door Services, LLC, as their consultant.
The Debtors require Golden Door to:
(a) review information related to the business, operations and
financial activities of the Debtors, including asset valuations,
corporate valuations, feasibility studies, historical and
management prepared projections, development and operating
statements and capital expenditure requirements;
(b) provide financial reporting for management which will
include tasks such as:
i. provide weekly & monthly financial reporting to
management;
ii. create a cash flow plan;
iii. work with salon managers to manage inventory and staff;
iv. reconcile financial statements into Quickbooks; and
v. provide all other interim controller functions;
(c) assist the Debtors in preparing documentation within its
area of expertise that is required in connection with any Chapter
11 proceeding;
(d) provide other tasks to be mutually agreed upon between
the Debtors and consultant.
Golden Door's requested compensation for professional services
rendered shall be $1,200 per week. The consultant intends to
provide approximately 15 hours of financial advising services per
week.
Golden Door is a disinterested person within the meaning of Sec.
101(14) of the Bankruptcy Code, according to court filings.
The firm can be reached through:
Vijar Kohli
Golden Door Services LLC
572 Broad St
Newark, NJ
About Mezz57th LLC
New York-based Mezz57th LLC, a company that conducts business under
the name John Barrett, filed a Chapter 11 petition (Bankr. S.D.N.Y.
Case No. 20-11316) on May 29, 2020. In the petition signed by John
Barrett, president and managing member, the Debtor was estimated to
have $1 million to $10 million in both assets and liabilities. The
Hon. Sean H. Lane oversees the case. BALLON STOLL BADER & NADLER,
P.C., serves as bankruptcy counsel to the Debtor.
MICHAEL D. COHEN: Proposes Online Auction of All Assets
-------------------------------------------------------
Michael D. Cohen, M.D., P.A. asks the U.S. Bankruptcy Court for the
District of Maryland to authorize the online public auction of
substantially all assets to Multispecialty Physicians, LLC, subject
to overbid, for the aggregate consideration of (i) a good faith
deposit of $7,000, (i) a payment in cash or cash equivalent in the
amount of $129,417, (iii) at Closing, payment of a Buyer's Premium
in the amount of 6.2) of the Cash Consideration, plus an amount
required to pay all other expenses incurred in connection with the
auction by the auctioneer, up to a maximum amount of $6,179 (which
includes $500 for the online platform company), plus all applicable
sales taxes; and (iv) the Assumed Liabilities, if any, subject to
any additions or deletions that may occur up to the Closing Date.
The Debtor's efforts to confirm a plan in the Chapter 11 case,
while diligent, were ultimately unsuccessful, resulting in the
Debtor's determination that a sale of substantially all of its
assets is the best available means to maximize the value of its
assets for the benefit of creditors and the estate.
Earlier in the bankruptcy case, the Debtor employed Fox Commercial
Auctions, LLC, whose current address is 1312 Bellona Avenue, Suite
101, Lutherville, MD 21093, to appraise its assets. As requested,
Fox conducted an appraisal and issued an appraisal report with an
effective date of March 6, 2018, which valued the Debtor's tangible
assets as having a fair market value of $154,440 and a forced
liquidation value of $106,515. Fox undertook a new appraisal of
the Debtor's assets and issued a report dated Feb. 28, 2020, which
values the Debtor's tangible assets as having a fair market value
of $126,595 and a forced liquidation value of $87,150.
In addition to its tangible assets, the Debtor also has the
following additional assets: (a) accounts receivable having an
estimated collectible value of approximately $50,000 as of the date
of the proposed auction sale in July 2020; and (b) intellectual
property, including a website, domain names, and trade names which
the Debtor does not believe would have value to a third party.
The Debtor's assets are subject to liens held by multiple
creditors, as follows:
a. Baltimore County has a lien on the Debtor's assets for
personal property taxes in the amount of $6,417 which were due and
unpaid as of the Petition Date.
b. M&T Bank has a valid, duly perfected first-priority senior
lien on all of the Debtor's assets, other than the collateral of
purchase money secured lenders (or their successors) listed below,
on which M&T Bank has a second lien, as security for loan
obligations the unpaid balance of which total $1,679,411 as of
March 9, 2020.
c. Bank of America, N.A. has a valid, duly perfected
first-priority senior lien on the assets of the Debtor consisting
of a Neograft FUE System, which Fox appraised as having a fair
market value of $12,000 and an orderly liquidation value of $8,000.
For the claim, Bank of America, N.A. filed a proof of claim for
the amount due as of the Petition Date in the amount of $69,810,
with the value of its collateral stated to be "unknown."
d. Bank Midwest, doing business as OnePlace Capital, has a
valid, duly perfected first priority senior lien on assets of the
Debtor consisting of an Xeo Console Laser System (S/N:XP15480),
which Fox appraised as having a fair market value of $15,000 and an
orderly liquidation value of $10,000. For this claim Bank Midwest
filed a proof of claim for the amount due as of the Petition Date
in the amount of $28,388, of which Bank Midwest asserted that the
value of the collateral was $15,500.
e. Stearns Bank N.A. has a valid, duly perfected
first-priority senior lien on assets of the Debtor consisting of
certain ophthalmology equipment known as the Zeiss system and
related equipment, which Fox l appraised as having a fair market
value of $57,801.50 and an orderly liquidation value of $43,370.
For this claim, Stearns Bank N.A. filed a proof of claim for the
amount due as of the Petition Date in the amount of $260,617.31,
with the value of its collateral asserted to be $100,000.
f. PNC Bank, N.A. has a security interest on all of the
assets of the Debtor as security for a claim in the amount of
$202,106, and filed a proof of claim for a secured claim in that
amount. However, the Debtor understands and believes that PNC Bank,
N.A.'s security interest is junior to the security interest held by
M&T Bank, and also is subordinate to liens held by the Other
Secured Creditors who hold purchase money security interests in
their respective specific collateral. The Debtor therefore
believes that under Section 506(a) of the Bankruptcy Code, PNC
Bank's claim is entirely unsecured.
g. Navitas Credit Corp. filed an unsecured claim in the
amount of $11,851 for amounts due under an equipment lease priority
for two glass shelves and two rotary mirrors. Although the Debtor
believes this claim is unsecured, because it is based on an
agreement that purports to be a lease but the Debtor maintains is
an unsecured financing arrangement, the claim is listed in case
Navitas Credit Corp. claims an interest in the shelves and mirrors
covered by the agreement.
Accordingly, the amounts of the creditor claims secured by liens on
the Debtor's assets far exceed the value of the assets.
In addition to secured debts, the Debtor also is subject to the
following unsecured liabilities:
(a) Chapter 11 Administrative expenses estimated to total
approximately $10,000 to $20,000 as of Closing, excluding accrued
and unbilled ordinary business expenses which will be paid in the
ordinary course of business, and accrued and unbilled professional
fees and expenses, which will be paid only upon Court approval.
(b) General nonpriority unsecured claims, including claims of
secured creditors in amounts exceeding the value of their
collateral: The Debtor estimates that there are approximately $5.1
million of such general unsecured claims.
The proposed sale to the Purchaser is subject to higher and better
offers, and the Debtor has engaged Fox Auctions to market the sale
in advance of an online public auction, with advertisements to be
posted in the Baltimore Sun and Washington Post, as well as direct
email solicitations to be sent to medical equipment and other
equipment buyers. The Auction will be conducted by Fox on July 17,
2020, with all winning bids subject to Court approval.
The Debtor's principal, Michael D. Cohen, will be employed by the
Purchaser after Closing, if the Sale Motion is granted by the
Court. The Purchaser anticipates compensating Dr. Cohen with 40%
of collections realized by the Purchaser from Dr. Cohen's services
to patients.
As set forth in Articles IV and V of the Initial Bid, the Cash
Consideration will be used to pay at Closing without further
application, notice, or order of the Court, the secured claim of
M&T Bank and the property taxes that constitute a first priority
lien on all of the Debtor’s assets, in exchange for the release
of their liens on the Debtor's assets.
The costs of the sale include the auctioneer's commission of 6.52%
of the Cash Consideration (of which 1.5% is for the cost payable to
the online platform company), plus reimbursement of the
auctioneer's out-of-pocket expenses, which will include advertising
costs totaling $5,679 and a $500 fee for the online platform
company to conduct the auction.
Upon execution of the Asset Purchase Agreement, the Purchaser will
make a good-faith deposit of $7,000 (just over 5% of the Purchase
Price), which will be held in an escrow account until Closing or
until the Asset Purchase Agreement is terminated in accordance with
its terms, in which case the deposit will be paid to the Purchaser,
as set forth in Article III of the Initial Bid. The books and
records of the Debtor will remain at the Premises.
Article V of the Initial Bid requires entry of a Sale Order
authorizing and ordering a sale of the Purchased Assets free and
clear of all liens, claims, and interests of any kind or nature
whatsoever, including, inter alia, claims that may be asserted
under doctrines such as successor liability, alter ego, de
factomerger, or mere continuation theory, implied assumption,
continuation of the enterprise or any other claims and cause of
action, or doctrine in support of any claim against the Purchaser
as a consequence of consummating the acquisition of the Purchased
Assets, all such claims, causes of actions, or doctrines.
The Debtor asks approval for the sale of substantially all of
assets free and clear of liens, claims, and interests, as follows:
a. Prior to the filing of this Sale Motion, the Debtor entered
into an agreement entitled "Initial Bid for the Purchase of
Substantially All Assets of Michael D. Cohen, M.D., P,A, and
Proposed Asset Purchase Agreement" with Multispecialty Physicians,
LLC, new company formed by Dr. Cohen for which Dr. Cohen is the
sole shareholder. As the principal of both the Debtor and the
Purchaser, Dr. Cohen is an insider of the Debtor within the meaning
of the Bankruptcy Code.
b. Under the Initial Bid, the Purchaser has agreed to submit
as an initial bid at an online public auction to be conducted by
Fox for the Debtor, including an agreement to pay a Purchase Price
for all of the Debtor’s assets, other than the Excluded Assets,
in the total amount of $136,417, to be paid out as follows:
(i) At Closing, the Purchaser will pay the Debtor, for
payment to Baltimore County, the sum of $6,417 in satisfaction of
the lien resulting from prepetition unpaid personal property taxes.
(ii) At Closing, the Purchaser will pay the Debtor, for
payment to M&T Bank on account and in satisfaction of its secured
claim on all assets of the Debtor, the sum of $130,000.
(iii) At Closing, the Purchaser will pay a Buyer's
Premium to Fox in the amount of 6.5% of the Cash Consideration (of
which 1.5% is for the cost of contracting with the online platform
company for the Auction), plus reimbursement of its actual
out-of-pocket expenses for implementing its advertising and
marketing plan in connection with the Auction up to the maximum
amount of $6,179 (which includes $500 for the online platform
company), and full payment of the sales tax as determined on or
before the Closing Date.
(iv) In the event the Purchaser and one or more of the
Other Secured Creditors reach a mutually acceptable agreement on or
before the Auction Date with respect to the sale price and terms
for the sale of the collateral on which the Other Secured Creditors
each have a first priority lien, the Purchaser will assume a
portion of the indebtedness to each such Other Secured Creditor and
will purchase the collateral of each such Other Secured Creditor,
provided that such Other Secured Creditors' respective liens will
remain on its collateral until such time as the Purchaser completes
payment of the agreed amount. In the event that such an agreement
is reached, the terms of such agreement will be disclosed on the
record prior to the bidding at the public auction.
(v) The Initial Bid will be subject to higher and better
bids at an on-line public auction to be conducted by Fox on July
17, 2020, or such other date determined by the Debtor. Prior to
the Auction Date, Fox will market the Debtor's assets in accordance
with the auction marketing process. Bidders will be given an
opportunity to inspect the assets to be sold in advance of the
auction, at an agreed designated time. The Initial Bid will be the
starting bid for the Debtor's assets, and will be subject to higher
and better bids. Fox also will entertain bids for less than all of
the Debtor’s assets either individually or in lots. Due to the
pandemic, the Auction will be conducted online. In the event of a
higher and better bid, the Initial Bid will be the back-up purchase
contract in the event the Superior Offer does not close in
accordance with the terms of the Superior Offer.
(vi) After conclusion of the Auction, the Debtor will
present the results to the Court at the hearing on the Sale Motion
and will ask the Court's approval of either the Initial Bid or one
or more Superior Offers, in the event that there are Superior
Offers.
c. The Initial Bid is intended to be the initial bid at the
on-line public auction to be held for the sale of the Debtor's
assets, subject to higher and better bids at the auction. The
Debtor proposes to ask Court approval of the sale of its assets to
either the Purchaser or such other purchasers who may submit
Superior Bids at the auction.
The Debtor is asking a waiver of the 14-day stay ordinarily imposed
on orders authorizing sales of property of the estate under section
363 of the Bankruptcy Code.
A copy of the Agreement is available at
https://tinyurl.com/y8twotzk from PacerMonitor.com free of charge.
A hearing on the Motion was set for July 7, 2020 at 10:00 a.m.
About Michael D. Cohen, M.D., P.A.
Based in Maryland, Michael D. Cohen, M.D., P.A. d/b/a Cosmetic
Surgery Center of Maryland d/b/a Belcara Health, d/b/a Belcara, is
a professional corporation engaged in the business of providing
various physician services to its patients, including but not
limited to services in the areas of plastic surgery, dermatology,
and podiatry. Michael D. Cohen, M.D., is the sole shareholder of
the Debtor. Shari L. Cohen, Dr. Cohen's wife, is responsible for
the business administration of the Debtor's medical practice.
Michael D. Cohen, M.D. and his wife, Shari L. Cohen jointly filed a
joint Chapter 11 petition (Bankr. D. Md. Case No. 16-21513) on Aug.
26, 2016.
The Company filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. D. Md. Case No. 16-22231) on Sept. 12,
2016. The Debtor estimated assets in the range of $100,000 to
$500,000 and liabilities in the range of $1 million to $10 million
as of the bankruptcy filing. The Debtors cases are jointly
administered under (Bankr. D. Md. Case No. 16-22231).
The Company is represented by Irving Edward Walker, Esq., at Cole
Schotz P.C.
The Cohens are represented by Yumkas, Vidmar, Sweeney & Mulrenin,
LLC.
MIDTOWN CAMPUS: Taps 'Ordinary Course' Professionals
----------------------------------------------------
Midtown Campus Properties, LLC filed an application with the U.S.
Bankruptcy Court for the Southern District of Florida to employ
certain professionals utilized in the ordinary course of its
business.
The ordinary course professionals either have provided services to
the Debtor in a variety of matters prior to and unrelated to its
Chapter 11 case or will be needed by the Debtor to provide
non-bankruptcy services, including those related to (i) general
nonbankruptcy corporate and real estate matters, (ii) land use,
planned development plan approval, permitting and project
coordination with the City of Gainesville, (ii) project based
bookkeeping, invoicing, accounting and tax services, (iii)
construction management and consulting, and (iv) engineering
services.
The application, if approved by the court, would allow Debtor to
pay, without formal application to the court by any ordinary course
professional, 100 percent of fees and disbursements to each
professional retained by the Debtor upon (i) each professional's
submission of a declaration of disinterestedness, and (ii) upon the
submission to the Debtor of an appropriate invoice setting forth in
detail the nature of the services rendered after the petition date;
provided however, that each professional's fees, excluding costs
and disbursements, do not exceed an average of $10,000 per month
while the bankruptcy case is pending.
The ordinary course professionals are as follows:
Attorney
Ricardo L. Fraga, Esq.
Greenberg Traurig, P.A.
333 SE 2nd Avenue, Suite 4400
Miami, FL 33131
fragar@gtlaw.com
C.David Coffey, Esq.
C. David Coffey, P.A.
300 E. University Avenue, Suite 110
Gainesville, FL 32601-3460
Accountant
Ralph A. Espinosa, CPA
Certified Public Accountant
Garcia, Espinosa, Miyares,
Rodriguez, Trueba & Company, LLP
2600 S. Douglas Rd, Suite 800
Coral Gables, Fl 33134
respinosa@gemrtcpa.com
Construction Engineer
Richard A. Slider
Slider Engineering Group, Inc
2301 Centrepark West Drive, Suite 175
West Palm Beach, FL 33409
Construction Consultant
Maria B. Bosch, CFCC, CCP, PSP
The Bosch Group, Inc.
1931 NW 150th Avenue, Suite 110
Pembroke Pines, FL 33028
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.
MLAC CASTLE ATLANTA: Taps Buckley Beal as Special Counsel
---------------------------------------------------------
The MLAC Atlanta Castle, LLC received approval from the U.S.
Bankruptcy Court for the Northern District of Georgia to employ
Buckley Beal, LLP as special counsel.
Buckley Beal as special counsel will investigate and pursue certain
claims for negligence, breach of fiduciary duty, professional
negligence and other causes of action the Debtor may have against
its former counsel and his law firm related to, inter alia, the
proposed pre-petition reorganization of Debtor and regarding the
development, operation and financing of the historic property on
15th Street in Atlanta, Georgia, known as "The Castle."
Compensation to special counsel shall be on a contingency fee basis
at a rate of 37 percent of the gross amount recovered by
settlement, judgment, or offer from any responsible party.
Andrew M. Beal, Esq., partner at Buckley Beal, attests that the
firm does not represent any interest adverse to the Debtor and its
estates.
The firm can be reached through:
Andrew M. Beal, Esq.
Buckley Beal, LLP
600 Peachtree St NE #3900
Atlanta, GA 30308
Phone: +1 404-781-1100
About The MLAC Castle Atlanta
The MLAC Castle Atlanta, LLC filed a Chapter 11 petition (Bankr.
N.D. Ga. Case No. 19-68220) on Nov. 12, 2019. It is a single asset
real estate debtor as defined in 11 U.S.C. Section 101(51B).
At the time of the filing, the Debtor disclosed assets of between
$1 million and $10 million and liabilities of the same range. The
petition was signed by Bryan Latham, manager.
Judge James R. Sacca oversees the case. The Law Office of Scott B.
Riddle, LLC represents the Debtor as legal counsel.
MOUNTAIN STATES: May Lay Off 222 Employees Amid Bankruptcy Auction
------------------------------------------------------------------
Dan Mika, writing for BizWest, reports that Greeley, Colorado-based
lamb meatpacker Mountain States Rosen LLC could lay off 222
employees depending on the result of the August 2020 bankruptcy
auction.
The plant at 920 N. Seventh Ave. is expected to be sold in a
Chapter 11 bankruptcy sale set for Aug. 11, 2020, according to a
notification letter sent by the company to state labor officials.
However, a subsidiary of Rosen submitted a stalking-horse bid of
$10 million for the plant last month, meaning that it could retain
control of the plant if it were to win at auction.
Employees of the plant are due to be formally notified that they
may be either laid off and immediately rehired if Rosen's
subsidiary wins the sale, or permanently separated if the company
loses.
Rosen's parent company filed in Wyoming bankruptcy court in April,
saying it had been in conversations to restructure $18.18 million
in debt from CoBank, a Colorado financial institution that
primarily handles agricultural financing. According to affidavits
filed in the case, those negotiations fell apart, and widespread
job losses caused by the coronavirus pandemic led to a steep drop
in sales for high-priced proteins such as lamb. That drop was
particularly acute this spring, when lamb sales usually spike
during the Easter and Passover season.
Rosen estimates that it controls 20% of the U.S. lamb market and
counts grocers Safeway and Kroger Co. (NYSE: KR) among its primary
customers.
A copy of the full-report is available at
https://bizwest.com/2020/06/11/greeley-lamb-packer-could-lay-off-222-amid-bankruptcy-sale/
About Mountain States Rosen LLC
Mountain States Rosen LLC is a privately held company in the animal
slaughtering and processing business with its principal place of
business at 920 7th Ave., Greeley, Colo. For more information,
visit http://mountainstatesrosen.com/
Mountain States Rosen sought bankruptcy protection (Bankr. D. Wyo.
Case No. 20-20111) on March 19, 2020. The petition was signed by
Mountain States Rosen President Brad Graham. At the time of the
filing, Debtor was estimated to have assets between $10 million and
$50 million and liabilities of the same range.
Judge Cathleen D. Parker oversees the case.
The Debtor tapped Markus Williams Young & Hunsicker, LLC as its
legal counsel, and r2 Advisors, LLC as its financial advisor.
The Office of the U.S. Trustee appointed a committee to represent
unsecured creditors in Debtor's bankruptcy case. Tucker Ellis, LLP
and Patton & Davison, LLC serve as the committee's lead bankruptcy
counsel and local counsel, respectively.
MULIANG AGRITECH: WWC Raises Substantial Going Concern Doubt
------------------------------------------------------------
Muliang Agritech, Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K, disclosing a net income
of $2,205,379 on $12,882,250 of revenues for the year ended Dec.
31, 2019, compared to a net income of $4,473,819 on $13,205,024 of
revenues for the year ended in 2018.
The audit report of WWC, P.C. states that the Company had a working
capital deficit, which raises substantial doubt about its ability
to continue as a going concern.
The Company's balance sheet at Dec. 31, 2019, showed total assets
of $26,733,566, total liabilities of $16,543,712, and a total
stockholders' equity of $10,189,854.
A copy of the Form 10-K is available at:
https://is.gd/RyhkOu
Muliang Agritech, Inc. is principally engaged in the fertilizer
processing and distribution business in the People's Republic of
China (PRC).
MY SIZE: Discloses Substantial Going Concern Doubt Exists
---------------------------------------------------------
My Size, Inc. filed its quarterly report on Form 10-Q, disclosing a
total comprehensive loss of $1,460,000 on $30,000 of revenues for
the three months ended March 31, 2020, compared to a total
comprehensive loss of $1,363,000 on $20,000 of revenues for the
same period in 2019.
At March 31, 2020, the Company had total assets of $3,070,000,
total liabilities of $1,387,000, and $1,683,000 in total
stockholders' equity.
The Company said, "We expect to continue to generate losses and
negative cash flows from operations for the foreseeable future and
expect to need to obtain additional funds in the future. As a
result, there is substantial doubt about the Company's ability to
continue as a going concern. However, we will need to raise
additional capital, which may not be available on reasonable terms
or at all."
A copy of the Form 10-Q is available at:
https://is.gd/bauboC
My Size, Inc. develops unique measurement technologies based on
algorithms with applications in a variety of areas, including the
apparel e-commerce market, the courier services market and the Do
It Yourself smartphone and tablet apps market. The technology is
driven by proprietary algorithms which are able to calculate and
record measurements in a variety of novel ways. The Company has
two subsidiaries, My Size Israel 2014 Ltd. and Topspin Medical
(Israel) Ltd., both of which are incorporated in Israel. The
Company is based in Airport City, Israel.
NAPHTHA ENERGY: Seeks Approval to Tap Walker & Patterson as Counsel
-------------------------------------------------------------------
Naphtha Energy Solutions, LLC seeks approval from the U.S.
Bankruptcy Court for the Southern District of Texas to employ
Walker & Patterson, P.C. as counsel.
The Debtor requires the services of the counsel to perform the
following:
(a) advise and counsel the Debtor in performing the duties
required of the Debtor-In-Possession;
(b) render professional services for it in the general
administration of the case;
(c) prepare and file any necessary complaint or complaints to
recover property of the estate;
(d) render advice and counsel to the Debtor-In-Possession;
(e) prepare pleadings and documents for the use and sale of
property;
(f) prepare, negotiate and draft documents required for a Plan
of Reorganization;
(g) represent the Debtor-In-Possession at court hearings; and
(h) perform all other legal services which may be necessary to
carry-out the provisions of Title 11 of the United States Code.
The hourly rates of the firm's attorneys are below:
Johnie Patterson $575
Miriam Goott $525
Walker & Patterson will seek reimbursement of actual and necessary
expenses pursuant to 11 U.S.C. Sec. 330(a)(1)(B).
The firm received a $75,000.00 retainer from the Debtor.
Walker & Patterson, P.C. is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Johnie Patterson, Esq.
WALKER & PATTERSON, P.C.
P.O. Box 61301
Houston, TX 77208-1301
Telephone: (713) 956-5577
Facsimile: (713) 956-5570
E-mail: jjp@walkerandpatterson.com
About Naphtha Energy Solutions
Naphtha Energy Solutions, LLC, d/b/a Hippo Energy Partners, located
at 1645 Greens Prairie Rd., College Station, Texas, filed a
voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Tex. Case No. 20-33115) on June 22, 2020. In the petition
signed by Robert W. Pierce, Jr., managing member, the Debtor
disclosed total assets of $2,765,299 and total liabilities of
$2,874,223. Hon. Jeffrey P. Norman oversees the case. The Debtor
tapped Walker & Patterson, P.C. as its counsel.
NEIMAN MARCUS: Creditors' Committee Hires Cole Schotz as Co-Counsel
-------------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 Cases of Neiman Marcus Group LTD LLC and its debtor
affiliates seeks approval from the U.S. Bankruptcy Court for the
Southern District of Texas to employ Cole Schotz P.C. as co-counsel
to the Committee, effective as of May 22, 2020.
The professional services that Cole Schotz will render to the
Committee include:
(a) advise the Committee with respect to its rights, duties,
and powers in these Chapter 11 cases;
(b) assist and advise the Committee in its consultations with
the Debtors relative to the administration of these Chapter 11
cases;
(c) assist the Committee in analyzing the claims of the
Debtors' creditors and the Debtors' capital structure and in
negotiating with holders of claims;
(d) assist the Committee in its investigation of the acts,
conduct, assets, liabilities, and financial condition of the
Debtors and of the operation of the Debtors' business;
(e) assist the Committee in its investigation of the liens and
claims of the Debtors' lenders and the prosecution of any claims or
causes of action revealed by such investigation;
(f) assist the Committee in its analysis of, and negotiations
with, the Debtors or any third-party concerning matters related to,
among other things, the assumption or rejection of leases of
nonresidential real property and executory contracts, asset
dispositions, financing or other transactions, and the terms of one
or more plans of reorganization for the Debtors and accompanying
disclosure statements and related plan documents;
(g) assist and advise the Committee in communicating with
unsecured creditors regarding significant matters in these Chapter
11 cases;
(h) represent the Committee at hearings and other
proceedings;
(i) review and analyze applications, orders, statements of
operations, and schedules filed with the Court and advise the
Committee as to their propriety;
(j) assist the Committee in preparing pleadings and
applications as may be necessary in furtherance of the Committee's
interests and objectives;
(k) prepare, on behalf of the Committee, any pleadings,
including without limitation, motions, memoranda, complaints,
adversary complaints, objections or comments in connection with any
of the foregoing;
(l) handle matters that are not appropriately handled by
Pachulski Stang because of actual and potential conflict of
interest issues; and
(k) perform such other legal services as may be required or
requested or as may otherwise be deemed in the interests of the
Committee in accordance with the Committee's powers and duties as
set forth in the Bankruptcy Code, Bankruptcy Rules or other
applicable law.
Cole Schotz will use best efforts to coordinate and divide
responsibilities with the Committee's lead counsel, Pachulski Stang
Ziehl & Jones LLP, to avoid unnecessary duplication of services.
Cole Schotz's attorneys and paralegals primarily responsible for
representing the Committee, and their current standard hourly rates
are:
Michael D. Warner, Member $840
Benjamin L. Wallen, Associate $350
Kerri L. LaBrada, Paralegal $265
The range of hourly rates for other professionals are as follows:
Members $435 - $990
Associates $275 - $650
Paralegals $210 - $330
In addition, Cole Schotz will charge the Committee for
out-of-pocket expenses incurred in connection with these cases.
Cole Schotz has not been paid any retainer against which to bill
fees and expenses.
The following is provided in response to the request for additional
information set forth in D.1 of the Guidelines for Reviewing
Applications for Compensation and Reimbursement of Expenses Filed
under 11 U.S.C. Sec. 330 by Attorneys in Larger Chapter 11 Cases
(the Revised Guidelines):
Question: Did you agree to any variations from, or alternatives to,
your standard or customary billing arrangements for this
engagement?
Response: No.
Question: Do any of the professionals included in this engagement
vary their rate based on the geographic location of the bankruptcy
case?
Response: No.
Question: If you represented the client in the twelve (12) months
prepetition, disclose your billing rates and material financial
terms for the prepetition engagement, including any adjustments
during the 12 months prepetition. If your billing rates and
material financial terms have changed post-petition, explain the
difference and the reasons for the difference.
Response: Cole Schotz did not represent the Committee before its
formation on May 19, 2020. Cole Schotz's billing rates have not
changed since the Petition Date.
Question: Has your client approved your prospective budget and
staffing plan, and, if so, for what budget period?
Response: As Committee counsel, Cole Schotz anticipates that the
budget for Committee professionals will be governed by the Debtors'
Emergency Motion for Entry of Interim and Final Orders (I)
Authorizing the Debtors to (A) Obtain Post-petition Financing and
(B) Utilize Cash Collateral, (II) Granting Adequate Protection to
Prepetition Secured Parties, (III) Modifying the Automatic Stay,
(IV) Scheduling a Final Hearing, and (V) Granting Related Relief
[ECF No. 104], subject to any rights that the Committee may have to
object if an agreement cannot be reached between the Debtors and
the Committee. The Committee and its professionals reserve all
rights to seek approval of Committee professional fees.
Michael D. Warner, a member of the law firm of Cole Schotz P.C.,
disclosed in court filings that the firm is a "disinterested
person" within the meaning of section 101(14) of the Bankruptcy
Code.
The attorney can be reached at:
Michael D. Warner, Esq.
COLE SCHOTZ P.C.
301 Commerce Street, Suite 1700
Fort Worth, TX 76102
Telephone: (817) 810-5265
Facsimile: (817) 977-1611
E-mail: mwarner@coleschotz.com
About Neiman Marcus Group
Neiman Marcus Group LTD, LLC is a luxury omni-channel retailer
conducting store and online operations principally under the Neiman
Marcus, Bergdorf Goodman, and Last Call brand names. It also
operates the Horchow e-commerce website offering luxury home
furnishings and accessories. Since opening in 1907 with just one
store in Dallas, Neiman Marcus and its affiliates have
strategically grown to 67 stores across the United States. For more
information, visit https://www.neimanmarcus.com/
Neiman Marcus Group LTD and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No.
20-32519) on May 7, 2020. At the time of the filing, the Debtors
were each estimated to have assets of between $1 billion and $10
billion and liabilities of the same range.
Judge David R. Jones oversees the cases.
Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis
International, LLP as bankruptcy counsel; Jackson Walker, LLP as
local counsel; Berkeley Research Group, LLC as restructuring
advisor; Lazard Freres & Co. LLC as investment banker; and Stretto
as claims, noticing and solicitation agent.
The Official Committee of Unsecured Creditors appointed in the
Chapter 11 Cases tapped Pachulski Stang Ziehl & Jones LLP as lead
counsel and Cole Schotz P.C. as co-counsel.
P.P.S. TRUCKING: Seeks Approval to Hire PPL Group as Auctioneer
---------------------------------------------------------------
P.P.S. Trucking, LLC seeks approval from the U.S. Bankruptcy Court
for the Western District of Oklahoma to employ PPL Group, LLC as
auctioneer.
The Debtor desires to employ PPL Group for the purpose of
liquidating its assets, rolling stock and equipment.
PPL Group will receive a commission of 2.5%, charge a buyer's
premium of 10% for onsite sales and 13% for online sales and be
reimbursed for certain expenses, subject to the approval of this
Court.
PPL Group, LLC is a "disinterested person" within the meaning of
Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
PPL GROUP, LLC
105 Revere Drive, Suite C
Northbrook, IL 60062
Telephone: (224) 927-5300
About P.P.S. Trucking
P.P.S. Trucking, LLC, a provider of trucking services in Hennessey,
Okla., filed a voluntary petition under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Okla. Case No. 19-14563) on Nov. 7,
2019. In the petition signed by Tom Holder, vice-president, the
Debtor estimated $50,000 in assets and $10 million to $50 million
in liabilities. Stephen J. Moriarty, Esq., at Fellers, Snider,
Blankenship, Bailey & Tippens, P.C., is the Debtor's counsel.
PANOCHE ENERGY: Moody's Hikes Rating on Sr. Sec. Notes to B1
------------------------------------------------------------
Moody's Investors Service upgraded Panoche Energy Center, LLC's
senior secured notes to B1 from B3 and revised the project's
outlook to stable. This rating action concludes the review for
upgrade that commenced on June 16, 2020.
RATINGS RATIONALE
The upgrade of Panoche's senior secured bonds to B1 from B3
reflects the recent emergence of Pacific Gas & Electric Company
(PG&E) and its parent, PG&E Corporation (Ba2/stable; Corporate
Family Rating) from bankruptcy, which follows the bankruptcy court
approval of its Plan of Reorganization (POR) and the approval by
the California Public Utility Commission (CPUC). The rating action
recognizes that PG&E's POR incorporates the assumption of the
utility's power purchase agreements (PPA) obligations, including
Panoche's PPA. Throughout the PG&E bankruptcy, the utility has
remained current on obligations owed to power generators including
Panoche.
The rating action also recognizes that the PG&E bankruptcy impacted
project level liquidity and introduces some refinancing risk by the
future need to repay a drawn letter of credit (L/C) obligation due
in October 2022. In July 2019, the project drew $16.3 million under
its debt service reserve L/C as the uncertainty around the PG&E
bankruptcy eliminated the ability to extend the expiry date of the
associated credit facility resulting in the L/C being drawn to fund
the debt service reserve. Positively, the outstanding debt under
the debt service reserve loan was reduced by $4.2 million to its
current level of $12.1 million through the project's sale of a PG&E
pre-petition claim. The repayment of any drawn L/C loans ranks pari
passu with the senior secured bonds.
Panoche's liquidity and free cash flow generation continue to be
further impacted by the project's need to satisfy liabilities
associated with carbon emission purchases each year with a large
payment potentially due in 2021. To date, Panoche has been able to
manage its liquidity to meet this ongoing obligation, however
annual debt service coverage ratios and free cash flow generation
have declined. Moreover, since the project does not control its own
dispatch, it has limited ability to control its operational
exposure to this ongoing risk leaving it exposed to both carbon
emission volume and price risk. Moody's estimates that Panoche's
DSCR is expected to be at or below 1.2x through 2021. Also, in
2022, when the $12.1 million DSR loan matures, and assuming that
none of the loan is repaid prior to maturity and there are no
material changes in its carbon emission related assumptions,
Moody's believes that the project could potentially have a
liquidity requirement of $5 million in 2022. As such,in the absence
of Panoche addressing the $12.1 million DSR loan maturity prior to
2022, Panoche's ability to manage its liquidity each year will be a
key credit consideration.
As of March 31, 2020, the project had $4.7 million of cash on its
balance sheet, and a major maintenance reserve cash funded on a
3-year look forward basis of $1.9 million. In addition, Panoche
maintains a $36 million L/C fulfilling its requirements under its
PPA which was extended in 2019.
Panoche's credit quality also considers the project's position and
intrinsic value from a capacity standpoint as a peaking unit in a
high load pocket. Panoche's operational and financial performance
has remained adequate, but with some forced outages experienced in
Q4 2019 and in Q1 2020 which negatively impacts capacity revenues.
Rating Outlook
Panoche's stable rating outlook reflects its belief that the
project will perform as expected enabling it receive its annual
capacity payment from PG&E, a reliable and consistent source of
revenue and cash flow. The stable outlook also assumes that Panoche
will be able to manage its liquidity related challenges over the
next two years, including the annual payment of carbon emission
liabilities and the repayment of the DSCR loan maturity in 2022.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Factors that could lead to an upgrade
The rating could be positively pressured if there is an improvement
in liquidity, particularly if the project can address the October
2022 DSR loan maturity prior to its scheduled maturity date in a
manner that eliminates the lumpiness from this required payment
particularly since the project will most likely need to use any
excess liquidity for carbon emission requirements. The project can
also be upgraded if the cost of its GHG emissions decline
appreciably from its current expectation owing to lower carbon
prices or a lower dispatch profile resulting in the project have a
stronger liquidity profile.
Factors that could lead to a downgrade
Panoche's rating could be downgraded if the project's operating
performance weakens on a sustained basis causing financial metrics
and project level liquidity to decline appreciably, or if the
project is dispatched at higher than historical levels on a
sustained basis as a result of PG&E continuing their practice of
dispatching the project without GHG costs, creating additional GHG
emission costs for the project, net of the Legacy Contract
allowances it receives. The rating could also be further pressured
if the project is unable to provide a timely solution to the
upcoming one-time large DSR loan maturity prior to October 2022.
Panoche Energy Center, LLC owns an approximate 400 MW natural
gas-fired simple-cycle generating facility operating primarily as
an intermediate and peaking generation plant. Panoche consists of
four GE LMS100 turbine units and is located 50 miles west of the
City of Fresno in Firebaugh, California. Panoche is owned by
affiliates of Ares Management, L.P.
The principal methodology used in this rating was Power Generation
Projects published in June 2018.
PEOPLE WHO CARE: Taps Keller Williams as Real Estate Broker
-----------------------------------------------------------
People Who Care Youth Center, Inc. seeks approval from the U.S.
Bankruptcy Court for the Central District of California to employ
Keller Williams – Inglewood as real estate broker.
The Debtor desires to employ Keller Williams – Inglewood to list
its commercial real property building located at 1502 and 1512 West
Slauson Avenue, Los Angeles, California 90047 for sale and to
advise the Debtor on negotiation, acceptance, or rejection of
various sale offers from potential buyers.
The firm has agreed to represent the Debtor as its real estate
listing broker for five percent (5.00%) of the sales price, which
may be split 50/50 between a listing agent and buyer's agent. The
property is being listed at $2,399,000.00.
The firm has not received any lien or other interest in property of
the Debtor or of a third party to secure payment of the firm's fees
or expenses.
The firm seeks to be paid from the Debtor's estate for any and all
fees incurred and expenses advanced pursuant to 11 U.S.C. Sec. 328
without the need for additional notice, application, or hearing; it
is contemplated that the firm's fees and expenses would be paid at
the closing of the sale after the Court enters an order approving
such sale.
Kory Jackson, a license real estate broker at Keller Williams –
Inglewood, disclosed in court filings that the firm is a
"disinterested person" as that term is defined in Bankruptcy Code
Section 101(14).
The firm can be reached through:
Kory Jackson
KELLER WILLIAMS – INGLEWOOD
111 N. La Brea Avenue, Suite 300
Inglewood, CA
Telephone: (310) 717-3720
Facsimile: (310) 861-5994
E-mail: koryjackson@gmail.com
About People Who Care Youth Center
People Who Care Youth Center, Inc., is a non-profit corporation
that provides child daycare to low-income working parents in South
Central Los Angeles. Its primary asset is a commercial real
property building located at 1502 and 1512 West Slauson Avenue, Los
Angeles, California.
People Who Care Youth Center sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. C.D. Cal. Case No. 18-10290) on Jan.
10, 2018. In the petition signed by CEO Michelle McArn, the Debtor
was estimated to have assets of $100,000,001 to $500 million and
liabilities of $500,001 to $1 million. Judge Sheri Bluebond
presides over the case. Levene, Neale, Bender, Yoo & Brill L.L.P.
is the Debtor's counsel.
PERMICO MIDSTREAM: Trustee Taps Norton Rose Fulbright as Counsel
----------------------------------------------------------------
William R. Greendyke, the Court-appointed chapter 11 trustee for
Debtors Permico Midstream Partners Holdings, LLC and Permico
Midstream Partners LLC, seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to employ Norton Rose
Fulbright US LLP as his counsel.
Norton Rose Fulbright will render the following legal services to
the Trustee:
(a) advising and consulting with the Trustee about his powers
and duties in the continued operation of the Debtors' business and
management of their properties;
(b) preparing, on behalf of the Trustee, all schedules,
statements, lists, applications, motions, legal memoranda,
objections, responses, answers, orders, reports, and other legal
papers necessary to the administration of these chapter 11 cases;
(c) representing the Trustee concerning the disposition of the
Debtors' executory contracts;
(d) advising and consulting with the Trustee in cash
collateral and financing negotiations and litigation;
(e) assisting the Trustee in the development, negotiation,
litigation and confirmation of a chapter 11 plan of reorganization
and the preparation of a disclosure statement or statements in
respect thereof;
(f) attending meetings and negotiating with representatives of
creditors, the U.S. Trustee, and other parties-in-interest;
(g) assisting with any disposition of assets, by sale or
otherwise;
(h) taking actions as may be necessary to preserve and protect
the Debtors' assets;
(i) providing general corporate, capital markets, financial,
tax, employment, and litigation advice, and other general
non-bankruptcy legal services to the Trustee on an as-needed
basis;
(j) appearing before this Court and any appellate courts to
protect the interests of the Trustee and the Debtors' estates; and
(k) performing all other legal services for, and providing all
other necessary legal advice to, the Trustee that may be necessary
and proper in these chapter 11 cases.
The hourly billing rates for the firm's attorneys and professionals
are as follows:
Partners $625 - $1,165
Senior associates $410 - $750
Associates $315 - $750
Paralegals $110 - $450
Jason L. Boland $792
Bob B. Bruner $724.50
Julie Goodrich Harrison $544.50
The firm will apply to the Court, when appropriate, for allowance
of compensation and reimbursement of expenses in accordance with
applicable provisions of the Bankruptcy Code, the Federal and Local
Rules of Bankruptcy Procedure, and this Court's orders.
The firm did not receive any payments from the Trustee or the
Debtors prior to the Petition Date and does not currently hold a
retainer from the Trustee or the Debtors. As of the Petition Date,
neither the Trustee nor the Debtors owed the firm any amounts for
legal services.
The Trustee believes that the firm is a "disinterested person" as
that term is defined in Bankruptcy Code Section 101(14).
The firm can be reached through:
Jason L. Boland, Esq.
NORTON ROSE FULBRIGHT US LLP
Fulbright Tower1301 McKinney, Suite 5100
Houston, TX 77010-3095
Telephone: (713) 651-3769
E-mail: jason.boland@nortonrosefulbright.com
About Permico Midstream Partners Holdings
Debtors Permico Midstream Partners Holdings, LLC and Permico
Midstream Partners LLC are subsidiaries of Permico Energia LLC -- a
U.S. based energy company with offices in Houston, Texas and
Washington D.C. The Company is focused on developing, constructing,
and operating assets in Texas, as well as domestic and
international marketing of hydrocarbons. For more information,
visit https://www.permicoenergia.com.
Permico Midstream Partners Holdings, LLC and Permico Midstream
Partners LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D. Tex. Lead Case No. 20-32437) on May 4, 2020. The
petitions were signed by Bryan M. Gaston, chief restructuring
officer. At the time of the filing, each Debtor disclosed estimated
assets of $0 to $50,000 and estimated liabilities of $100 million
to $500 million. Hon. Marvin Isgur oversees the cases. The Debtors
tapped Hunton Andrews Kurth LLP as counsel and Ankura Consulting
Group, LLC as financial advisor.
William R. Greendyke is the appointed Chapter 11 Trustee for the
Debtors. He is represented by Norton Rose Fulbright US LLP.
PIMLICO RANCH: Seeks to Hire Robert M. Yaspan as Legal Counsel
--------------------------------------------------------------
Pimlico Ranch, LLC seeks authority from the U.S. Bankruptcy Court
for the United States Bankruptcy Court for the Central District of
California to hire the Law Firm of Robert M. Yaspan, as general
bankruptcy counsel to the Debtor.
Pimlico Ranch requires Robert M. Yaspan to:
a. negotiate with the creditors of the Debtor;
b. assist the Debtor with the negotiation, confirmation, and
implementation of the Debtor's Plan of Reorganization under Chapter
11;
c. prepare the Schedule of Current Income and Current
Expenses, Statement of Financial Affairs, Statement of All
Liabilities of the Debtor, and Statement of All Property of the
Debtor;
d. prepare pleadings, attend at Court hearings and work with
the various parties interested in the bankruptcy case;
e. give the Debtor legal advice with respect to the powers and
duties as Debtor-in-Possession in the continued operation of the
management of the property;
f. prepare on behalf of the Debtor and Debtor-in-Possession
necessary applications, answers, orders, reports, and other legal
papers; and
g. perform all other legal services for the Debtor, which may
be necessary.
Robert M. Yaspan will be paid at these hourly rates:
Robert M. Yaspan, Esq. $595
Debra Brand, Esq. $475
Joseph McCarty, Esq. $475
Paralegal $150 - $250
Prior to the petition date, Robert M. Yaspan received from the
Debtor the amount of $$27,500, including the filing fee.
Robert M. Yaspan will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Robert M. Yaspan, partner of the Law Firm of Robert M. Yaspan,
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.
Robert M. Yaspan can be reached at:
Robert M. Yaspan, Esq.
Law Firm of Robert M. Yaspan
21700 Oxnard Street, Suite 1750
Woodland Hills, CA 91367
Tel: (818) 774-9929
Fax: (818) 774-9989
About Pimlico Ranch
Pimlico Ranch, LLC is a Single Asset Real Estate (as defined in 11
U.S.C. Section 101(51B)). It owns vacant land and 25-unit
residential subdivision in Murrieta, California, having an
appraised value of $5.5 million.
Pimlico Ranch filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 20-13407) on
June 22, 2020. In the petition signed by Ben R. Clymer, managing
member, the Debtor estimated $5,500,000 in assets and $6,719,670 in
liabilities. Robert M. Yaspan, Esq., at the Law Firm of Robert M.
Yaspan represents the Debtor as counsel.
PROPERTY VENTURES: Hires Turner Legal Group as Bankruptcy Counsel
-----------------------------------------------------------------
Property Ventures, LLC seeks approval from the U.S. Bankruptcy
Court for the District of Nebraska to employ Turner Legal Group,
LLC as lead bankruptcy counsel.
The professional services that Turner Legal Group will render
include:
(a) give the Debtor legal advice with respect to its powers
and duties as debtor-in-possession and in the continued operation
of its business and in the management and reorganization of its
affairs;
(b) prepare, on behalf of the Debtor, necessary legal
documents, including, but not limited to, documentation and
pleadings related to the proposed sale of substantially all of the
Debtor's assets;
(c) prepare and file a Plan of Reorganization and any required
accompanying Disclosure Statement for and on behalf of the Debtor;
and
(d) perform all other legal services for the Debtor as may be
reasonably requested by the Debtor and as are reasonably necessary
herein.
The Debtor, subject to the approval of this Court, has agreed to
compensate the firm on an hourly basis at $305.00 per hour. The
firm received a retainer in the amount of $1,717.00. These funds
were placed in the firm's trust account and used to pay the filing
fee for this case.
The Debtor believes that Turner Legal Group, LLC is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code and as required by Section 327(a) of the Bankruptcy
Code.
The firm can be reached through:
Patrick R. Turner, Esq.
TURNER LEGAL GROUP, LLC
139 S. 144th Street, #665
Omaha, NE 68010
Telephone: (402) 690-3675
E-mail: pturner@turnerlegalomaha.com
About Property Ventures
Property Ventures, LLC is the owner of a property located at
5002-06 S. 24th St Omaha, NE 68107. The Debtor previously sought
bankruptcy protection on Dec. 13, 2017 (Bankr. D. Neb. Case No.
17-81762).
Property Ventures, LLC filed a voluntary petition under Chapter 11
of the Bankruptcy Code (Bankr. D. Neb. Case No. 20-80750) on June
8, 2020. The petition was signed by Lisa Rezac, Trustee, Gloria Ann
Murante Intervivos Trust. At the time of the filing, the Debtor
disclosed total assets of $318,708 and total liabilities of
$6,210,101 as of May 31, 2020. The Debtor tapped Turner Legal
Group, LLC as counsel.
QUALITY WELDING: Hires Massey Higginbotham as Special Counsel
-------------------------------------------------------------
Quality Welding & Fabrication, Inc. seeks authority from the US
Bankruptcy Court for the Southern District of Mississippi to employ
Massey Higginbotham & Vise, P.A. as its special counsel.
Massey Higginbotham will assist the Debtor in general business
matters as it continues operating during the pendency of the
Chapter 11 proceeding.
The firm will be retained at the rate of $275 per hour for
partners, $175 per hour for associates and $125 per hour for
paralegals.
G. Michael Massey, Esq., of Massey Higginbotham, disclosed in court
filings that he has no connection with creditors of the estate and
other "parties-in-interest."
The firm can be reached through:
G. Michael Massey, Esq.
Massey Higginbotham & Vise, P.A.
3003 Lakeland Cove, Suite E
Jackson, MS 39232
Phone: +1 601-420-2200
About Quality Welding & Fabrication
Based in Columbia, Mississippi, Quality Welding & Fabrication, Inc.
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Miss. Case no. 20-50970) on June 11, 2020, listing $1 million
to $10 million in both assets and liabilities. Robert Alan Byrd,
Esq. represents the Debtor as counsel.
QUALITY WELDING: Seeks to Hire Byrd & Wiser as Counsel
------------------------------------------------------
Quality Welding & Fabrication, Inc. seeks authority from the US
Bankruptcy Court for the Southern District of Mississippi to employ
Byrd & Wiser as legal counsel in its Chapter 11 case.
Byrd & Wiser will charge an hourly fee of $325 for its services.
The firm will also receive reimbursement for work-related expenses
incurred.
Robert Alan Byrd, Esq., an attorney at Byrd & Wiser, disclosed in
court filings that the firm is "disinterested" as that term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Robert Alan Byrd, Esq.
Byrd & Wiser
P.O. Box 1939
Biloxi, MS 39533
Tel: 228 432-8123
Fax: 228 432-7029
Email: rab@byrdwiser.com
About Quality Welding & Fabrication
Based in Columbia, Mississippi, Quality Welding & Fabrication, Inc.
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Miss. Case no. 20-50970) on June 11, 2020, listing $1,000,001
to $10 million in both assets and liabilities. Robert Alan Byrd,
Esq. represents the Debtor as counsel.
REGIONAL HOLDING: Seeks to Hire Regional Bankruptcy as Counsel
--------------------------------------------------------------
Regional Holding, LLC, seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Pennsylvania to hire Regional
Bankruptcy Center of Southeastern PA, P.C. as its legal counsel.
Regional Bankruptcy Center will represent Debtor in its Chapter 11
case. The firm's services will be provided mainly by Roger
Ashodian, Esq., who will be paid an hourly fee of $300.
The firm has had no connection whatsoever with creditors or any
other "party in interest" in Debtor's bankruptcy case, according to
court filings.
Regional Bankruptcy Center can be reached through:
Roger V. Ashodian, Esq.
Regional Bankruptcy Center of Southeastern PA, P.C.
101 West Chester Pike, Suite 1A
Havertown, PA 19083
Phone: (610) 446-6800
Email: ecf@schollashodian.com
About Regional Holding
Regional Holding, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Pa. Case No. 19-15124) on Aug. 14,
2019. At the time of the filing, the Debtor had estimated assets
of less than $50,000 and liabilities of between $100,001 and
$500,000. Judge Magdeline D. Coleman oversees the case. The
Debtor is represented by Regional Bankruptcy Center of Southeastern
PA, P.C.
ROCK CHURCH: Seeks Approval to Hire Bankruptcy Attorney
-------------------------------------------------------
Rock Church of the Wabash Valley, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Indiana to employ B.
Scott Skillman as attorney.
The professional services that the attorney will render include:
(a) give the Debtor legal advice with respect to the Debtor's
powers and duties as Debtor-in-Possession in the continued
operation of the Debtor's business and management of the Debtor's
property;
(b) prepare on behalf of the Debtor as Debtor-in-Possession
all necessary applications, answers, motions, orders, reports, and
other legal papers;
(c) do any specific acts for which authority is sought; and
(d) perform all other legal services for the Debtor as
Debtor-in-Possession that may be necessary in this case.
The hourly rates and other terms of employment of the law firm of
B. Scott Skillman are as follows: an hourly rate of $250 for legal
work, an hourly rate of $100 for administerial work related to the
matter with a retainer in the amount of $4,000.00.
B. Scott Skillman disclosed in court filings that he has no
connection with the Debtor, or with any of the Debtor's creditors,
or any other party-in-interest in this case, or with any of their
respective attorneys or accountants, or the United States trustee.
He represents no interest adverse to the Debtor in this case or in
the Debtor's estate in the matters upon which this law firm is to
be engaged.
The attorney can be reached at:
B. Scott Skillman, Esq.
SKILLMAN DEFENSE FIRM
2901 Ohio Blvd., Suite 124
Terre Haute, IN 47803
Telephone: (765) 780-7545
About Rock Church of the Wabash Valley
Rock Church of the Wabash Valley, Inc. provides religious services
to members and the general public from its location at 8930 E.
Wabash Ave., Terre Haute, Ind.
Rock Church of the Wabash Valley sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Ind. Case No. 20-80240) on June
16, 2020. At the time of the filing, the Debtor disclosed assets of
between $100,001 and $500,000 and liabilities of the same range. B.
Scott Skillman, Esq., at Skillman Defense Firm, is the Debtor's
legal counsel.
RSB INVESTMENTS: Seeks to Hire Giddens & Gatton as Legal Counsel
----------------------------------------------------------------
RSB Investments Group, LLC seeks approval from the U.S. Bankruptcy
Court for the District of New Mexico to employ Giddens & Gatton
Law, P.C. as its legal counsel.
The firm will provide the following services:
a. represent and to render legal advice to Debtor regarding
all aspects of this bankruptcy case including adversary proceedings
and including, without limitation, the continued operation of
Debtor's business, meetings of creditors, cash collateral matters,
claims objections, plan confirmation and all hearings before this
Court;
b. prepare on behalf of Debtor necessary petitions,
complaints, answers, motions, applications, orders, reports, and
other legal papers, including Debtor's Subchapter 5 Chapter 11 plan
of reorganization;
c. assist Debtor in taking actions required to effect
reorganization under Subchapter 5 of Chapter 11 of the Bankruptcy
Code;
d. perform all legal services necessary or appropriate for
Debtor's continued operation; and
e. perform any other legal services for Debtor as it deems
appropriate.
Giddens & Gatton has been paid a retainer in the amount of $15,000,
paid by Sanjivkumar Patel.
Giddens & Gatton's hourly rates are:
Dave Giddens, Esq. $350
Chris Gatton, Esq. $275
Marcus Sedillo $175
Ashley Cook $175
Paralegals $115
Document clerk $40
Giddens & Gatton has no connection with Debtor, its creditors or
any other party in interest or their respective attorneys,
according to court filings.
The firm can be reached through:
Christopher M. Gatton, Esq.
Giddens & Gatton Law, P.C.
10400 Academy NE, Suite 350
Albuquerque, NM 87111
Phone: (505) 271-1053
Fax: (505) 271-4848
Email: chris@giddenslaw.com
About RSB Investments Group
RSB Investments Group, LLC is a privately held company in the
traveler accommodation industry. It is based in Deming, N.M.
On June 11, 2020, RSB Investments Group filed a voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.N.M.
Case No. 20-11176). At the time of the filing, Debtor disclosed
total assets of $164,327 and total liabilities of $1,019,142. Judge
Robert H. Jacobvitz oversees the case. Debtor is represented by
Briones Business Law Consulting, P.C.
SEHAR INC: Seeks to Hire Barrett McNagny as Special Counsel
-----------------------------------------------------------
Sehar Inc. seeks approval from the U.S. Bankruptcy Court for the
Northern District of Indiana to employ Barrett McNagny LLP as its
special counsel.
On May 29, 2019, the Debtor filed suit in the the Noble Superior
Court against N.W.I. Management, LLC, Hochstetler Concrete, LLC,
Redtke Engineering, LLC, IMPACT Site Contracting, and Joshua Walk.
Barrett McNagny will represent the Debtor on this case. William
Ramsey, Esq. will be the primary attorney for this matter. Mr.
Ramsey's hourly rate is currently $290 an hour.
Mr. Ramsey 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 estate.
The counsel can be reached through:
William Ramsey, Esq.
Barrett McNagny LLP
215 E Berry St
Fort Wayne, IN 46802
Phone: +1 260-423-9551
About Sehar Inc.
Sehar, Inc. is a privately held company in the gasoline service
stations industry based in Middlebury, Indiana. On May 11, 2020,
Sehar sought Chapter 11 protection (Bankr. N.D. Ind. Case No.
20-30785). The petition was signed by Sehar President Harpreet
Singh. At the time of the filing, Debtor disclosed total assets of
$56,351,600 and total liabilities of $27,960,931. Fred Wehrwein,
P.C. is Debtor's legal counsel.
SERTA SIMMONS: Moody's Rates New $200MM First Lien Loan 'B2'
------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to Serta Simmons
Bedding, LLC's new $200 million first lien super-priority
"first-out" term loan and a Caa2 rating to the company's exchanged
$851 million first lien "second-out" term loan. At the same time,
Moody's affirmed Serta Simmons' Corporate Family Rating at Caa3,
Probability of Default Rating at Caa3-PD, first lien term loan at
Ca and second lien term loan at C. The rating outlook remains
negative.
These actions follow Serta Simmons' entry into an agreement on June
22, 2020 with a majority of lenders of its first lien term loans
due 2023 and second lien term loans due 2024 to recapitalize the
company by allowing for certain new super priority tranches in
exchange for existing debt at a discount to the par value of the
loans. Specifically, the transaction put in place a new $200
million super-priority first lien "first-out" tranche (FLFO)
ranking ahead in payment priority from the existing first lien term
loan. Additionally, the company exchanged a portion of its existing
first lien term loan and existing second lien term loan into a new
super-priority tranche of $851 million that is a first lien
"second-out" tranche (FLSO) in payment priority following the FLFO
tranche. The transaction reduced the company's funded debt by
approximately $240 million due to the exchange of loans at 74% and
39% of par for the existing first lien and second lien term loans,
respectively.
The transaction also gives the company the ability to create an
additional basket for super-priority "third out" debt that ranks
ahead of existing first and second lien term loans in payment
priority and that can be used for future exchanges of existing
first lien and second lien term loans. Pro forma for the proposed
transaction, cash on hand was roughly $300 million at close and
there are no material debt maturities until 2023.
Various non-exchanging lenders that hold approximately 30% of the
first lien term loans due 2023 have filed a law suit against Serta
Simmons and other super priority exchanging lenders disputing the
validity of the transactions. A New York State Supreme Court Judge
ruled against the plaintiffs' request for an injunction and while
the lawsuit is still ongoing, the transactions closed on June 22.
For purposes of the assigned ratings only and because the
transactions closed, Moody's is assuming that the transaction will
not be disallowed or otherwise be negatively impacted by the
outcome of this or any similar litigation - but Moody's is not
opining one way or the other on the merits or likely outcome of any
litigation. Should litigation lead to the transaction being
disallowed, or to other negative outcomes, this could lead to a
change in, or withdrawal of, the assigned ratings.
As noted in its June 11 press release, Moody's views the
transactions as a distressed exchange default given the exchange of
a material amount of debt into new term loans at a significant
discount to par. Specifically, a majority of existing first-lien
term loan lenders exchange $992 million of existing first lien term
loans for $734 million of FLSO term loans, and the majority of
existing second lien term loan lenders exchanged $300 million of
existing second lien term loans for $116 million of new FLSO term
loans. Additionally, Moody's believes that term loan lenders who
did not consent to the transaction could potentially be left with
little or no remaining collateral coverage in Serta Simmons, as
well as in a position that is subordinated in payment priority
-though equal in lien priority- to the new term loans.
The affirmation of the Caa3 CFR considers that, while the
transaction provides additional liquidity from the $200 million
FLFO loan proceeds, Moody's believes Serta Simmons' pro forma
capital structure is not sustainable, and as a result, there is a
continued high risk of additional distressed debt exchanges or a
more comprehensive debt restructuring. Despite the roughly $240
million reduction in the company's funded debt burden, the
transactions meaningfully increase the company's annual cash
interest cost by roughly $20 million, and leverage will remain
substantial. Pro forma debt/EBITDA is high at 10.5x and, given the
company's already weak operating results along with the difficult
operating environment created by the coronavirus pandemic, Moody's
projects leverage will increase to approximately 13x over the next
12-18 months.
The B2 rating on the FLFO term loan is four notches above the
company's Caa3 CFR, while the Caa2 rating on the FLSO term loan is
one notch above the Caa3 CFR. The lift above the CFR reflects these
term loans' priority payment positions to the remaining $892
million first lien term loan maturing and priority lien on the
collateral relative to the remaining $124 million second lien term
loan. The FLFO and FLSO term loans mature in August 2023.
Moody's took the following rating actions on Serta Simmons Bedding,
LLC:
Assignments:
Issuer: Serta Simmons Bedding, LLC
First lien "first-out" Term Loan due 2023, Assigned B2 (LGD2);
First lien "second-out" Term Loan due 2023, Assigned Caa2 (LGD3);
Affirmations:
Issuer: Serta Simmons Bedding, LLC
Corporate Family Rating, Affirmed Caa3;
Probability of Default Rating, Affirmed Caa3-PD;
Senior Secured First Lien Term Loan due 2023, Affirmed Ca (LGD5);
Senior Secured Second Lien Term Loan due 2024, Affirmed C (LGD6);
Outlook Actions:
Issuer: Serta Simmons Bedding, LLC
Outlook, Remains Negative
RATINGS RATIONALE
Serta Simmons' Caa3 CFR reflects Moody's concern regarding the
sustainability of the company's debt capital structure given the
company's substantial pro forma and projected leverage, and
aggressive financial policy under private equity ownership, evident
by the $670 million debt financed dividend paid in 2016 and its
continued high financial leverage. The ratings are also constrained
by the company's declining earnings trend prior to the onset of the
coronavirus and the challenges to executing a material earnings
turnaround amid weak economic conditions and growing competition
from emerging digital selling channels and new entrants. The
company is vulnerable to weakness in cyclical consumer spending.
Moody's assumes the decline in earnings will be meaningful in the
second quarter and then moderate over the second half of 2020, and
that EBITDA will recover in 2021 to a level that remains below
2019. Positive consideration is given to Serta Simmons' solid scale
with revenue of about $2.2 billion, leading market share,
well-known brand names and product development capabilities. The
additional liquidity from the transactions also provide the company
greater flexibility to manage in the current downturn.
Serta Simmons is moderately exposed to environmental, social and
governance (ESG) risks. The company uses, transports, and stores
chemicals in its foam manufacturing process. A failure to adhere to
environmental regulations and safe practices could result in
financial penalties and remediation costs.
The rapid spread of the coronavirus outbreak, deteriorating global
economic outlook, low oil prices, and high asset price volatility
have created an unprecedented credit shock across a range of
sectors and regions. The consumer products sector has been one of
the sectors affected by the shock given its sensitivity to consumer
demand and sentiment. More specifically, the weaknesses in Serta
Simmons' credit profile, including its exposure to multiple
affected countries have left it vulnerable to shifts in market
demand and sentiment in these unprecedented operating conditions.
Moody's regards the coronavirus outbreak as a social risk under its
ESG framework, given the substantial implications for public health
and safety.
The negative outlook reflects Moody's view that Serta Simmons' pro
forma capital structure is not sustainable, and as a result, there
is a continued high risk of additional distressed debt exchanges or
a more comprehensive debt restructuring. The negative outlook also
reflects Moody's view that Serta Simmons' ability to materially
improve revenues, earnings and free cash flow is weakened by
efforts to curtail the coronavirus and an anticipated pullback in
consumer spending. The debt restructuring litigation also creates
uncertainty regarding the debt structure and could consume cash.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be downgraded if Serta Simmons' liquidity or recovery
values weaken, operating performance is weaker than expected, or
should Moody's feel the company's capital structure is becoming
increasingly unsustainable. A negative outcome from litigation on
the validity of the transaction or an increased probability that
Serta Simmons will pursue a debt restructuring could also lead to a
downgrade.
An upgrade would require that Serta Simmons materially improve its
operating performance and reduce its financial leverage. Moody's
would also need to gain greater comfort that the company's capital
structure is sustainable and the company will generate positive
free cash flow before considering an upgrade.
The principal methodology used in these ratings was Consumer
Durables Industry published in April 2017.
Serta Simmons Bedding, LLC is the parent company of Serta
International Holdco, LLC ("Serta") and Simmons Bedding Company,
LLC ("Simmons"). Both Serta and Simmons manufacture, distribute and
sell mattresses, foundations, and other related bedding products.
The company's brand names include, Serta, Beautyrest, Tuft & Needle
and Simmons. The company is majority owned Advent International and
generates about $2.2 billion in annual revenue.
SLT HOLDCO: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Two affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
SLT Holdco, Inc. (Lead Debtor) 20-18368
6100 4th Avenue South
Suite 500
Seattle, WA 98108
Sur La Table, Inc. 20-18367
150 Quaker Bridge Mall Road
Lawrenceville, NJ 08648
Business Description: Sur La Table, Inc. --
https://www.surlatable.com -- is a
privately held retail company that sells
kitchenware products, including
cookware, bakeware, kitchen tools,
knives, small appliances, dining and
home products, coffee and tea, food, and
outdoor cookware.
Chapter 11 Petition Date: July 8, 2020
Court: United States Bankruptcy Court
District of New Jersey
Judge: Hon. Michael B. Kaplan
Debtors' Counsel: Michael D. Sirota, Esq.
Warren A. Usatine, Esq.
David M. Bass, Esq.
Jacob S. Frumkin, Esq.
COLE SCHOTZ P.C.
Court Plaza North
25 Main Street
P.O. Box 800
Hackensack, New Jersey 07601
Tel: (201) 489-3000
Fax: (201) 489-1536
Email: msirota@coleschotz.com
wusatine@coleschotz.com
dbass@coleschotz.com
jfrumkin@coleschotz.com
Debtors'
Financial
Advisor &
Investment
Banker: SOLIC Capital
Debtors'
Real Estate
Advisor: A&G REALTY PARTNERS, LLC
Debtors'
Sales
Consultant: GREAT AMERICAN GROUP, LLC
- AND -
TIGER CAPITAL
Debtors'
Claims &
Noticing
Agent and
Administrative
Agent: OMNI AGENT SOLUTIONS
https://is.gd/ZwADLd
SLT Holdco's
Estimated Assets: $10 million to $50 million
SLT Holdco's
Estimated Liabilities: $50 million to $100 million
Sur La Table's
Estimated Assets: $100 million to $500 million
Sur La Table's
Estimated Liabilities: $100 million to $500 million
The petitions were signed by Jason Goldberger, CEO.
Copies of the petitions are available for free at PacerMonitor.com
at:
https://is.gd/pN42bq
https://is.gd/6lXaLX
List of Sur La Table's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Zwilling J.A. $2,244,687
Henckels LLC
Kaj Johnson, Chief Financial Officer
270 Marble Avenue
Pleasantville, NY
2. Le Creuset of America $1,928,663
Chris Bauman, VP of Finance
114 Bob Gifford Blvd
Early Branch, SC 29916
Email: chris.bauman@lecreuset.com
3. Scanpan USA, Inc. $1,443,022
Natalie Giraldo,
Controller
2319 E. Gladwick Street
Compton, CA 90220
Email: ng@scanpan.com
4. Wusthof USA, Inc. $774,300
Todd Myers, VP of Sale
Catherine Celentano,
Accounting Manager
333 Wilson Ave
Norwalk, CT 06854
Email: tmyers@wusthof.com
5. Jura Inc. $774,262
Tom McMahon, President
Dianne Baia,
Accounts Receivable
20 Craig Rd
Montvale, NJ 07645
Email: Tom.mcmahon@us.jura.com
6. OXO International LTD $604,987
Leslie Henderson,
National Sales Manager
Seema Dalal
One Helen of Troy Plaza
El Paso, TX 79912
Email: lhenderson@oxo.com
7. The Cookware Co. $547,419
Don Hildebrand, CFO
Jacob Maurer, President
660 White Plains Road
Suite 500
Tarrytown, NY 10591
Email: Jacob.maurer@cookware-co.com
8. Groupe SEB Kimberly Feehan, $383,888
VP Business Controlling
5 Wood Hollow Rd,
2nd Floor
Parsippany, NJ 07054
Email: Kfeehan@groupeseb.com
9. United Parcel Service, Inc. $352,849
Norman Moore
400 White Clay Center Dr.
Newark, DE 19711
Email: nmoore@ups.com
10. SalesForce.com, Inc. $309,780
Joseph Sullivan
Attn: SFCD General Counsel
The Landmark @One Market
Ste 300
San Francisco, CA 94105
Email: Joseph.sullivan@salesforce.com
11. Conair Corporation $270,997
Lauren Miller, Sr Director
50 Millstone Road
Building 100, Suite 200
East Windsor, NJ 08520
Email: Lauren_miller@conair.com
12. Hearst Communications, Inc. $267,516
Office of General Counsel
Attn: Real Estate Counsel
300 West 57th Street, 40th floor
New York, NY 10019
13. Cushman & Wakefield U.S. $253,181
Jody Danahy, Director
Facilities Manager
Facilities Solutions,
GOS
128 N 1st St Colwich, KS 67030
Email: Jody.Danahy@cushwake.com
14. Joshua Baily Shipping Co. $245,810
Joshua Baily Shipping Company, LLC
555 Madison Ave
New York, NY 10022
15. Westchester Mall, LLC $245,330
M.S. Management Associates Inc.
225 West Washington Street
Indianapolis, IN 46204-3438
16. Copley Place Associates. LLC $238,712
M.S. Management Associates Inc.
225 West Washington Street
Indianapolis, IN 46204-3438
17. Hudson One Ferry Operating, L.P. $236,861
Art Suazo, Executive Vice President
11601 Wilshire Blvd,
9th Floor
Los Angeles, CA 90025
18. SDD Holdings $231,375
Douglas E. Whitner,
Chief Revenue Office
675 Mondial Parkway
Streetsboro, OH 44241
Email: dwhitner@spectrumdd.com
19. Avobagel Company Limited $216,783
Rudy Keller Unit 1303,
Austin Tower
22-26 Austin Avenue
Tsimshatsui, Kowloon
Email: Joanne@avobagel.com
20. Chilewich $185,686
Bob Bruno, CFO
Barrett Miningham,
Sales Director
39 West 19th Street
New York, NY 10011
Email: bminingham@chilewich.com
SLT Holdco stated it has no unsecured creditors.
TAM S.A.: Case Summary & 40 Largest Unsecured Creditors
-------------------------------------------------------
Eight affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
TAM S.A. 20-11597
Rua Verbo Divino, 2001
17th Floor Unit 172
Chacara Santo Antonio
Sao Paulo, SP, CP 04719-002
TAM Linhas Aereas S.A. 20-11598
Rua Verbo Divino, 2001
17th Floor, Unit 171
Chacara Santo Antonio
Sao Paulo, SP, CP 04719-002
Multiplus Corredora de Seguros Ltda. 20-11599
Rua Verbo Divino, 2001
10th Floor, Unit 101 Part A
Chacara Santo Antonio, Sao Paulo
SP, CP 04719-002
Prismah Fidelidade Ltda. 20-11600
Rua Verbo Divino, 2001
10th Floor, Unit 101 Part B
Chacara Santo Antonio, Sao Paulo
SP, CP 04719-002
Fidelidade Viagens e Turismo S.A. 20-11601
Rua Verbo Divino, 2001
13th Floor, Unit 132
Chacara Santo Antonio
Sao Paulo, SP, CP 04719-002
TP Franchising Ltda. 20-11602
Rua Verbo Divino, 2001
8th Floor, Unit 83
Chacara Santo Antonio
Sao Paulo, SP, CP 04719-002
Aerolinhas Brasileiras S.A. 20-11603
Aeroporto Internacional de Viracopos
Rodovia Santos Dumont, Km 66
sistema viario principal, s/n
Holdco I S.A. 20-11604
Estado 10, Piso 11
Santiago, Chile
Business Description: Each of the Debtors is either a direct or
indirect subsidiary of LATAM Airlines Group
S.A., an airline holding company
headquartered in Santiago, Chile.
Simultaneously with the filing of the
petitions, each of the Debtors filed a
motion seeking an order of joint
administration of its Chapter 11 case
with that of LATAM Airline Group S.A., Case
No. 20-11254.
Chapter 11
Petition Date: July 9, 2020
Court: United States Bankruptcy Court
Southern District of New York
Judge: Hon. James L. Garrity, Jr.
Debtors' Counsel: Richard J. Cooper, Esq.
Lisa M. Schweitzer, Esq.
Luke A. Barefoot, Esq.
Thomas S. Kessler, Esq.
CLEARY GOTTLIEB STEEN & HAMILTON LLP
One Liberty Plaza
New York, New York 10006
Tel: (212) 225-2000
Fax: (212) 225-3999
Email: rcooper@cgsh.com
lschweitzer@cgsh.com
lbarefoot@cgsh.com
tkessler@cgsh.com
Estimated Assets
(on a consolidated basis): $10 billion to $50 billion
Estimated Liabilities
(on a consolidated basis): $10 billion to $50 billion
The petitions were signed by Ramiro Alfonsin Balza, authorized
signatory.
Copies of the petitions are available for free at
PacerMonitor.com at:
https://is.gd/Ujxqiz
https://is.gd/RwrpHu
https://is.gd/DWhsVD
https://is.gd/YIQzgl
https://is.gd/YW1ZZr
https://is.gd/SzD4Hp
https://is.gd/OfKXMH
https://is.gd/3zhF7O
Consolidated List of Debtors' 40 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. LATAM 2026 Notes Unsecured Notes $800,000,000
Attn: Peter Lopez
Bank of New York Mellon, as Trustee
240 Greenwich Street
7E
Tel: 212 815 8273
Email: peter.lopez@bnymellon.com
2. LATAM 2024 Notes Unsecured Notes $700,000,000
Attn: Peter Lopez
Bank of New York Mellon, as Trustee
240 Greenwich Street
7E
Tel: 212 815 8273
Email: peter.lopez@bnymellon.com
3. Banco Santander Chile Frequent $549,000,000
Bandera N* 140 Flier Miles
Santiago, Metropolitana
Chile
Maria Soledad Schuster
Tel: 56(2)2648 3669 Anexo 83669
Email: mariasoledad.schuster@santander.cl
4. EXIM ‐ Aircraft EXIM-Aircraft
$261,628,819
Loan Agreement Loan Agreement
Attn: Sarah Velez
Wells Fargo Trust
Company, N.A., as Agent
299 S Main Street, 5th Floor
Salt Lake City, UT 84111
Tel: 385‐415‐8024
Email: sarah.velez@wellsfargo.com
5. Banco do Brasil S.A. Unsecured Debt $195,354,619
Attn: Rodrigo Szabo Luiz
Large Corporate 3132
Rua Sao Carlos do Pinhal,
627 ‐ 1 subsolo (Docas)
Bela Vista
Sao Paulo‐SP
01333‐001 Brazil
Tel: 55(11)4298‐7056;
55(11)99618‐9230
Email: rodrigoszabo@bb.com.br
6. Local Bonds, Series E Unsecured Notes $179,030,673
Attn: Francesca Gardella
Banco del Estado de Chile,
as Trustee
Avenida Libertador
Bernardo O'Higgins 1111
Santiago, Metropolitana
Chile
Tel: 562‐2970 6210
Email: fgarde@bancoestado.cl
7. Banco de Credito del Peru Frequent $167,000,000
Attn: Kristel Vasquez Guzman Flier Miles
Calle Centenario 156
Lima, Peru
Tel: 51.1.313.2000
Fax: 51.1.313.2121
Email: kristelvasquezg@bcp.com.pe
8. Banco Santander Madrid Unsecured Debt $139,458,747
Attn: Luis Casero Ynfiesta
Av. de Cantabria s/n
28660 Boadilla del Monte
Madrid, Spain
Tel: 34 91 289 72 47
Email: luis.casero@gruposantander.com
9. EXIM ‐ Aircraft Loan Agreement EXIM Aircraft
$138,670,419
Attn: Michael Leonard Loan Agreement
Citibank, N.A., Loan Administration
1615 Brett Road, OPS 3
New Castle, DE 19720
Tel: 212‐816‐5233
Email: michael.leonard@citi.com
10. EXIM ‐ Aircraft Loan Agreement EXIM Aircraft
$137,451,740
Attn: Sarah Velez Loan Agreement
Wells Fargo Trust Company, N.A.,
as Agent
299 S Main Street, 5th Floor
Salt Lake City, UT 84111
Tel: 385‐415‐8024
Email: sarah.velez@wellsfargo.com
11. ECA ‐ Aircraft Loan Agreement ECA - Aircraft
$98,039,103
Attn: Juan Suarez Romero Loan Agreement
Banco Santander, as Agent
Bandera 140, piso 14
Santiago, Chile
Tel: 56223363331;
56995503775
Email: juan.suarez@santander.cl
12. Local Bonds, Series A Unsecured Notes $89,515,336
Attn: Francesca Gardella
Banco del Estadode Chile, as Trustee
Avenida Libertador Bernardo O'Higgins 1111
Santiago, Metropolitana
Chile
Tel: 562‐2970 6210
Email: fgarde@bancoestado.cl
13. Local Bonds, Series B Unsecured Notes $89,515,336
Attn: Francesca Gardella
Banco del Estado de Chile, as Trustee
Avenida Libertador Bernardo O'Higgins 1111
Santiago, Metropolitana
Chile
Tel: 562‐2970 6210
Email: fgarde@bancoestado.cl
14. Banco Bradesco S.A. Unsecured Debt $78,486,876
Attn: Leon L. Albuquerque e Sousa
Av. Brigadeiro Faria Lima
3950, 9 andar
Sao Paulo, SP 04538‐132
Brazil
Tel: (11)3847‐9181;
(11)97693‐5644
Email: leon.sousa@bradesco.com.br
15. Scotiabank Chile Unsecured Debt $74,000,000
Attn: Federico Alonso
Casa Matriz
Av Costanera Sur 2710, Torre A
Santiago, Chile
Tel: 416‐866‐6161
Email: Federico.Alonso@scotiabank.cl
16. GE Celma Ltda Trade Debt $72,788,641
Attn: Edgar Salazar
Volnei Vieira Esteves
R. Alice Herve, 356 ‐ Bingen,
Petropolis ‐ RJ 25669‐900
Brazil
Email: edgar.salazar1@ge.com;
VolneiVieira.Esteves@ge.com
17. EXIM ‐ Aircraft Loan Agreement EXIM Aircraft
$71,911,661
Attn: Sarah Velez Loan Agreement
Wells Fargo Trust Company, N.A., as Agent
299 S Main Street, 5th Floor
Salt Lake City,UT 84111
Tel: 385‐415‐8024
Email: sarah.velez@wellsfargo.com
18. Local Bonds, Series C Unsecured Notes $66,241,349
Attn: Francesca Gardella
Banco del Estadode Chile, as Trustee
Avenida Libertador Bernardo O'Higgins 1111
Santiago, Metropolitana, Chile
Tel: 562‐2970 6210
Email: fgarde@bancoestado.cl
19. Local Bonds, Series D Unsecured Notes $66,241,349
Attn: Francesca Gardella
Banco del Estado de Chile, as Trustee
Avenida Libertador Bernardo O'Higgins 1111
Santiago, Metropolitana
Chile
Tel: 562‐2970 6210
Email: fgarde@bancoestado.cl
20. Banco BTG Pactual Chile, Unsecured Debt $59,438,183
as Agent
Attn: Rodrigo Oyarzo
Avenida Costanera Sur 2730
19th Floor
Santiago, Metropolitana
Chile
Tel: 56 22 587 5027
Email: Rodrigo.Oyarzo@btgpactual.com
21. Aircraft Loan Agreement Aircraft Loan $56,696,392
Attn: Juan Suarez Romero Agreement
Banco Santander, as Agent
Bandera 140, piso 14
Santiago, Chile
Tel: 56 2 2336 3331;
56 9 9550 3775
Email: juan.suarez@santander.cl
22. Aerospace Turbine Trade Debt $54,749,119
Services & Solutions
Attn: Mansoor Janahi
Adjacent Abu Dhabi Intl
Airport Turbine Services Building Gate
Number 3
Abu Dhabi
United Arab Emirates
Tel: 971 (2 )5057887
Email: MJanahi@tssaero.ae
23. American Express Travel Unsecured Debt $52,511,111
Related Services Company, Inc.
Attn: Liliana Gutierrez
200 Vesey Street
New York, NY 10285
Tel: 56 2 2783 8733
Email: liliana.w.gutierrez@aexp.com
24. Banco Itau Unibanco S.A. Frequent Flier $52,299,456
Attn: Michele do Carmo Miles
Praca Alfredo Egydio de
Souza Aranha n 100, Torre
Olavo Setubal
Parque Jabaquara
Sao Paulo‐SP CEP 04344‐902
Brazil
Tel: 55 11 5029‐ 2355 ‐ Ext.7705
Email: michele.santo@itau‐unibanco.com.br
25. World Fuel Services Trade Debt $46,052,121
Attn: Richard Hoppe
9800 NW 41 Street, Suite 400
Miami, FL 33178
Tel: 1‐305‐799‐3532
Email: RHoppe@wfscorp.com
26. Banco del Estado de Chile Unsecured Debt $40,000,000
Attn: Francesca Gardella
Avenida Libertador Bernardo O'Higgins 1111
Santiago, Metropolitana
Chile
Tel: 562‐2970 6210
Email: fgarde@bancoestado.cl
27. BP p.l.c (AirBP) Trade Debt $39,882,361
Attn: John Platt, CEO
501 Westlake Park Boulevard
Houston, TX 77079
Tel: 971 5 04536032
Fax: 971 4 3318628
Email: airbpoutofhours@bp.com
28. EXIM ‐ Aircraft Loan Agreement EXIM Aircraft
$39,348,743
Attn: Sarah Velez Loan Agreement
Wells Fargo Trust Company, N.A., as Agent
299 S Main Street, 5th
Floor Salt Lake City,UT 8411
Tel: 385‐415‐8024
Email: sarah.velez@wellsfargo.com
29. EXIM ‐ Aircraft Loan Agreement EXIM Aircraft
$37,415,505
Attn: Arnaud Drapeau Loan Agreement
Societe Generale, as Agent
245 Park Avenue New York, NY 10167
Tel: 212‐278‐4103;
914‐434‐7016
Email: arnaud.drapeau@sgcib.com
30. EXIM ‐ Aircraft Loan Agreement EXIM - Aircraft
$37,378,515
Attn: Arnaud Drapeau Loan Agreement
Societe Generale, as Agent
245 Park Avenue
New York, NY 10167
Tel: 212‐278‐4103;
914‐434‐7016
Email: arnaud.drapeau@sgcib.co
31. Petroleo Brasileiro S.A. Trade Debt $35,973,425
Attn: Rodrigo Motta Guimares
200 Westlake Park Boulevard
Suite 1000
Houston, TX7707
Tel: 5521996474208
Email: rodrigo@br‐petrobras.com.br
32. EXIM ‐ Aircraft Loan Agreement EXIM - Aircraft
$35,286,477
Attn: Arnaud Drapeau Loan Agreement
Societe Generale, as Agent
245 Park Avenue
New York,NY 1016
Tel: 212‐278‐4103;
914‐434‐7016
Email: arnaud.drapeau@sgcib.com
33. EXIM ‐ Aircraft Loan Agreement EXIM - Aircraft
$34,039,807
Attn: Arnaud Drapeau Loan Agreement
Societe Generale, as Agent
245 Park Avenue
New York, NY 10167
Tel: 212‐278‐4103;
914‐434‐7016
Email: arnaud.drapeau@sgcib.com
34. EXIM ‐ Aircraft Loan Agreement EXIM Aircraft
$31,066,204
Attn: Sarah Velez Loan Agreement
Wells Fargo Trust Company, N.A., as Agent
299 S Main Street, 5th Floor
Salt Lake City, UT 84111
Tel: 385‐415‐8024
Email: sarah.velez@wellsfargo.com
35. Itau CorpBanca Unsecured Debt $29,857,588
Attn: Carlos Irarrazaval
Avenida Presidente Riesco 5537
16th Floor Santiago, Metropolitana
Chile
Tel: 56961699692
Email: Carlos.Irarrazaval@itau.cl
36. Aircraft Loan Agreement Aircraft Loan $29,151,065
Attn: Andrew Young Okana Nsiawi Agreement
Natixis as Agent
30, Avenue Pierre Mendes, BP 475060 Paris Cedex 02
542 044 524 RCS Paris
Paris 75013
France
Tel: 33(0)1 58 32 38 36
Email: andrew.okana@natixis.com
37. Raizen Combustiveis S.A. Trade Debt $28,570,916
Attn: Leonardo Ozorio
AV DAS AMERICAS,4200,BL 5(SALAS101/701)E BL 6
(SALAS101/601)
Bairro BARRA DA TIJUCA
Cidade Rio deJaneiro CEP22.640‐102
Brazil
Tel: 55(21)99174‐1677
Email: Leonardo.Ozorio@raizen.com
38. COMANDO DA AERONAUTICA Trade Debt $27,989,954
Attn: Major Brigadeiro do
Ar Walcyr Josue de Castilho
Araujo GABAER ‐ Esplanadados Ministerios ‐
BlocoM ‐ 8 Andar
Brasilia, DFCEP70.045‐900
Brazil
Tel: 55(21)21016205
Email: Walcyrwjca@decea.gov.br
39. IAE International Aero Engines AG Trade Debt $25,314,147
Attn: Florangel Gutierrez
400 Main Street East
Hartford, CT 0611
Email: florangel.gutierrez@pw.utc.com
40. Aircraft Loan Agreement Aircraft Loan $24,693,926
Attn: Andrew Young Okana Nsiawi Agreement
Natixis as Agent
30, Avenue Pierre Mendes, BP 4
75060 Paris Cedex 02
542 044 524 RCS Paris
Paris 75013 France
Tel: 33(0) 1 58 32 38 36
Email: andrew.okana@natixis.com
TAYLOR MORRISON: Moody's Rates Proposed $400MM Unsec. Notes Ba3
---------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Taylor Morrison
Communities, Inc.'s (TMHC) proposed $400 million senior unsecured
notes due 2030. Taylor Morrison's other ratings and stable outlook
remain unchanged. The proceeds of the new notes, along with
available cash, will be used to redeem approximately $222.4 million
of the 6% senior unsecured notes due 2023 and $277.6 million of the
5.875% senior unsecured notes due 2025 plus a redemption premium
and accrued and unpaid interest. The transaction is in line with
Moody's expectations of deleveraging following the close of the
William Lyon acquisition in February 2020 as it modestly reduces
leverage and improves the debt maturity profile of the company.
Proforma for the issuance, adjusted homebuilding debt to total
capitalization declines to 52.4% at March 31, 2020, from 53.1%.
Moody's expects leverage to decline below 50% by the end of the
year.
Assignments:
Issuer: Taylor Morrison Communities, Inc.
Senior Unsecured Notes, Assigned Ba3 (LGD4)
RATINGS RATIONALE
Taylor Morrison's Ba3 rating reflects the company's solid credit
metrics, despite the negative impact on leverage and interest
coverage following the Williams Lyon acquisition, and strong market
position within existing markets. These factors are counterbalanced
by a steady decline in operating margin and an increased level of
operational risk associated with the integration of a large peer on
the heels of a previous acquisition in October 2018.
The stable outlook reflects Moody's expectation of a successful
integration of William Lyon Homes and achievement of the planned
cost synergies that will support leverage falling below 50% over
the twelve months following the closing of the transaction. Moody's
also expects that the company will maintain good liquidity.
TMHC's liquidity is good and considers slower but still positive
cash flow growth in 2020, close to $235 million of availability on
the company's $800 million revolver as of June 30, 2020 and a
largely unencumbered asset base. Moody's views TMHC's financial
strategy as having a moderate level of risk, specifically with
respect to the company's acquisition track record. William Lyon
Homes is the second large public company acquisition within a
sixteen-month period.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The rating could be upgraded if the company can sustain adjusted
gross margin over 20%, interest coverage above 5.5X, and adjusted
homebuilding debt to book capitalization below 45%. A downgrade
could result should adjusted homebuilding debt to book
capitalization be sustained above 50%, interest coverage falls
below 4x, and adjusted gross margin be sustained below 18%. In
addition, negative ratings pressure would also result from any
difficulties in integrating the William Lyons Home acquisition.
The principal methodology used in this rating was Homebuilding and
Property Development Industry published in January 2018.
Taylor Morrison Home Corporation, an indirect parent company of
Taylor Morrison Communities, Inc., is a national homebuilder and
developer based in Scottsdale, Arizona and operates under two
brands, Taylor Morrison and Darling Homes. The company serves a
wide array of consumer groups from coast to coast, including
first-time, move-up, luxury, and 55 plus buyers. Pro forma for the
William Lyon Homes acquisition, revenue was $6.8 billion for the
year ended December 31, 2019.
THIRD DAY NIPOMO: Case Summary & 8 Unsecured Creditors
------------------------------------------------------
Debtor: Third Day Nipomo LLC
1458 South San Pedro St.
Ste. 310
Los Angeles, CA 90015
Case No.: 20-16147
Chapter 11 Petition Date: July 7, 2020
Court: United States Bankruptcy Court
Central District of California
Judge: Hon. Barry Russell
Debtor's Counsel: Yoon O. Ham, Esq.
LAW OFFICE OF YOON O. HAM
1425 W. Foothill Blvd., Suite 235
Upland, CA 91786
Tel: (909) 256-2920
Fax: (909) 256-2927
Email: hamyesq@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Michael Meyer, manager.
A copy of the petition containing, among other items, a list of the
Debtor's eight unsecured creditors is available for free at
PacerMonitor.com at:
https://is.gd/owX821
TOPAZ SOLAR: Moody's Raises Rating on Sr. Secured Debt to Ba2
-------------------------------------------------------------
Moody's Investors Service upgraded Topaz Solar Farms LLC's (Topaz
Solar) senior secured debt to Ba2 from B3 and revised the project's
outlook from review for upgrade to stable. This rating action
concludes the review for upgrade that commenced on June 16, 2020.
RATING RATIONALE
The upgrade of Topaz Solar's senior secured bonds to Ba2 from B3
reflects the July 1st emergence from bankruptcy by Pacific Gas &
Electric Company (PG&E) and its parent, PG&E Corporation
(Ba2/stable; Corporate Family Rating) which includes PG&E's
assumption of its power purchase agreements (PPA) obligations
including Topaz Solar's PPA. The upgrade further considers the
resolution of the technical debt default under Topaz Solar's letter
of credit facility concurrent with PG&E's emergence from bankruptcy
and the project's strong standalone operating and financial
performance. Topaz Solar has typically produced power at levels
generally at or above the forecasted P50 levels after adjusting for
curtailment. Because of the performance of the solar resource,
Topaz Solar's financial performance has historically been stronger
than anticipated and the project has achieved a debt service
coverage ratio (DSCR) generally ranging from 1.8x to 2.0x prior to
2019. For 2019, Topaz Solar had a DSCR of around 1.71x with the
non-payment of certain pre-petition claims by PG&E during Q1 2019
being the primary contributor to the DSCR being below the
historical range. Moody's expects these pre-petition claims will be
paid in Q3 2020. As of the last twelve months ending March 2020,
the project's DSCR improved to 1.88x.
Further supporting Topaz Solar's rating is its ownership by
Berkshire Hathaway Energy (BHE, A3 stable) and the strong
regulatory and public policy support for renewables in California.
While the project's standalone operating and financial performance
would warrant a higher rating, the project's credit quality remains
constrained by PG&E's credit quality since the project derives all
of its operating cash flow from its PPA with PG&E.
Rating Outlook
Topaz Solar's stable outlook reflects the stable outlook on PG&E
and its expectations that the project will achieve DSCR in the
1.80x to 2.0x range.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to a upgrade
Topaz Solar's rating is likely to be upgraded if PG&E is upgraded
while the project maintains strong operating and financial
performance.
Factors that could lead to a downgrade
The project's rating could be downgraded if PG&E is downgraded or
if the project severely underperforms.
Topaz Solar Farms LLC, an indirect subsidiary of Berkshire Hathaway
Energy Company (BHE, A3 stable), is a 550 MWac thinfilm
photovoltaic solar generating project in San Luis Obispo County,
California. The project was acquired in 2012 from First Solar,
Inc., who completed construction and remains responsible for
project operations and maintenance. All of the output from the
project is sold to PG&E under a PPA expiring in October 2039.
The principal methodology used in these ratings was Power
Generation Projects published in June 2018.
TRINIDAD GENERATION: Fitch Lowers Rating on Unsec. Notes to BB+
---------------------------------------------------------------
Fitch Ratings has downgraded Trinidad Generation Unlimited's senior
unsecured notes to 'BB+' from 'BBB-'.
The downgrade reflects TGU's importance to Trinidad and Tobago's
energy matrix and operational integration with its ultimate parent,
the country's government. Trinidad and Tobago's public finances
have deteriorated as a result of significantly lower global energy
prices, the coronavirus pandemic and a sharp economic contraction
in 2020. The government's balance sheet and economic activity will
continue to be highly sensitive to energy-related commodity cycles.
The steep decline of energy prices and the expected economic
contraction will result in a wide fiscal deficit and a debt burden
significantly higher than rating peers.
The rating also reflects the generation plant capacity is fully
contracted under a long-term power purchase agreement with the
Trinidad and Tobago Electricity Commission. Payments under the PPA
are guaranteed by the government.
KEY RATING DRIVERS
Strong Linkage with Government: Fitch considers TGU's credit
quality as being materially linked to that of Trinidad and Tobago,
given that the PPA between TGU and T&TEC, as off-taker, is fully
backed by a government guarantee. The asset is aligned with the
sovereign's overall strategy to maintain low energy prices as a
competitive edge for private investment. TGU is indirectly
controlled by the government through the National Investment Fund
Holding Company Limited, a fund formed to hold the government's
positions in national assets.
Stable and Predictable Cash Flows: TGU's stable and predictable
cash flows result from the U.S. dollar-denominated PPA signed with
T&TEC in September 2009 for 30 years, surpassing the 2027 maturity
of the notes. Approximately 99% of the company's revenues are
generated from the capacity payments, with energy sales making up
the balance. Its capacity payments assume plant availability of
93%, allowing the company a cushion of approximately 5% planned
maintenance and 2% unplanned shutdowns. For availability below 93%,
the company still receives a pro-rated capacity payment. In the
last three years, TGU has achieved availability factors above 92%.
Adequate Capital Structure: The company's leverage, given its very
low business risk and stable cash flows, is consistent with
investment-grade peers that operate under toll-based revenue
structures with little or no market-based risks, such as electric
transmission and pipeline companies. As of Dec. 31, 2019, TGU had
total debt/EBITDA of approximately 7.5x. Under Fitch's forecast
assumptions, it should remain at that level through the medium term
before trending down as debt amortizes. The company's cash flow
predictability will provide more than adequate debt service
coverage, measured as EBITDA to interest paid, of around 2.0x-2.5x
until the bond begins amortizing in 2025.
Strategically Important Asset: TGU owns and operates a 720MW net
capacity combined-cycle gas-fired plant, representing 34% of the
country's installed capacity and covering approximately 55% of the
country's average demand. The thermal power plant's operations are
supported by the country's large natural gas reserves, estimated at
11.5 trillion cubic feet, with an expected life of 7.6 years as of
2018. Under the sovereign's natural gas policies, the power sector
receives priority for delivery of natural gas in the event of
curtailments in gas supply.
Robust Profitability: Under the PPA, fuel is supplied and fuel and
water are guaranteed by T&TEC, the supply interruption of either
has no effect on TGU's receipt of capacity revenues. Payment and
delivery of the fuel is entirely T&TEC's obligation, limiting
operational risk. Fuel purchases are not recorded as costs in TGU's
financial statements, explaining the company's high EBITDA margins
of 75%-80%.
DERIVATION SUMMARY
The rating on TGU's notes compares favorably to other utility
companies in Latin America that operate under a tolling structure
such as GNL Quintero S.A. (GNLQ; BBB+/Stable) and Transelec S.A.
(BBB/Stable). TGU's counterparty risk with the government of
Trinidad and Tobago effectively anchors its rating at a level below
that of its toll-based peers.
The company's notes are rated three notches below GNLQ, which
benefits from the strong operating environment and regulatory
framework of Chile. In terms of leverage, GNLQ's deleveraging
trajectory is expected to fall below 6.0x on a gross leverage basis
by 2021, in the absence of additional investments while TGU will
remain at around 7.0x-7.5x until the notes start amortizing in
2025.
TGU's notes are rated two notches below Transelec, which benefits
from Chile's strong operating environment and regulatory framework.
In terms of leverage, Transelec's leverage is expected to remain at
around 6.0x as the company continues to expand operations in the
country.
KEY ASSUMPTIONS
-- GDP growth of -8% in 2020, +4% in 2021 and 1.4% thereafter;
-- Annual capex averaging USD10.4 million;
-- Annual dividends of 50% of net income of previous year.
-- Company continues to accumulate cash to make payments on the
amortizing notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Material improvement in the country's overall economic
condition.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Continued deterioration of macroeconomic conditions, leading
to weaker sovereign indicators;
-- Material delinkage from the government;
-- Substantially lower availability factors in conjunction with
major unplanned maintenance expenses, resulting in a debt service
coverage ratio below 1.5x on a sustained basis;
-- Dividend distributions that prevent the company from
accumulating sufficient cash to meet the amortization schedule on
the notes.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: TGU's liquidity is adequate as a result of
satisfactory cash on hand, strong cash flow generation and a
comfortable amortization profile. As of Dec. 31, 2019, the company
held USD120 million in cash and equivalents. At these levels,
EBITDA interest coverage was 2.1x. Fitch expects the company will
start accumulating cash in the next few years to cover debt service
once the notes start amortizing in 2025.
The USD600 million senior unsecured notes due in 2027 are TGU's
sole debt. Principal of the notes will be repaid in six equal
semiannual installments of USD100 million starting in May 2025.
Fitch expects dividend payments to slow in 2025 as the notes start
amortizing.
In May 2018, the government of Trinidad and Tobago created NIF, a
national fund with the purpose to hold and monetize national
assets. It then issued a TTD4.0 billion (USD600 million) bond to be
amortized with dividends flowing from these national assets. Under
the notes' terms, there are no restrictions on dividends payments
to shareholders.
ESG Considerations
ESG Relevance Score of 4 for Governance Structure resulting from
its nature as a government owned entity and the inherent governance
risk that may arise with a dominant state shareholder.
The Governance Structure score changed from 3 to 4 as a result of
weakening of sovereign macroeconomic indicators, which in Fitch's
view increases political intervention risk.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of 3 - ESG issues are credit
neutral or have only a minimal credit impact on the entity, either
due to their nature or the way in which they are being managed by
the entity.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
TGU is a Government Related Entity of Trinidad and Tobago and its
ratings are linked to those of the sovereign due to ownership and
off-taker risk.
TRIVASCULAR SALES: Gets Approval to Hire Omni as Claims Agent
-------------------------------------------------------------
TriVascular Sales, LLC, received approval from the U.S. Bankruptcy
Court for the Northern District of Texas to hire Omni Agent
Solutions as claims, noticing and administrative agent.
The firm will oversee the distribution of notices; assist
in the maintenance, processing and docketing of proofs of claim;
and provide other administrative services in connection with the
Chapter 11 cases of TriVascular Sales and its affiliates.
The firm's standard hourly rates are as follows:
Analyst $35 - $50
Consultants $65 - $160
Senior Consultants $165 - $200
Solicitation and Securities Services $205
Technology/Programming $85 - $135
Omni has agreed to provide Debtors with a 10 percent discount off
its hourly rates. The firm received a $50,000 retainer from
Debtors.
Paul Deutch, executive vice president of Omni, disclosed in court
filings that his firm is "disinterested" as defined in section
101(14) of the Bankruptcy Code.
The firm can be reached through:
Paul H. Deutch
Omni Agent Solutions
5955 De Soto Ave., Suite 100
Woodland Hills, CA 91367
Tel: 818-906-8300
Fax: 818-783-2737
Email: lacontact@omniagnt.com
About TriVascular Sales
TriVascular Sales, LLC, and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Lead Case No.
20-31840) on July 5, 2020. At the time of the filing, TriVascular
Sales had estimated assets of less than $50,000 and liabilities of
between $100 million to $500 million. The Debtors are represented
by DLA Piper LLP (US).
TTK RE ENTERPRISE: Sharmin Buying Atlantic City Property for $140K
------------------------------------------------------------------
TTK RE Enterprises, LLC, asks the U.S. Bankruptcy Court for the
District of New Jersey to authorize the private sale and conveyance
of the real estate located at 119 Maxwell Avenue, Atlantic City,
New Jersey to Sultana Sharmin for $140,000.
The Debtor owns approximately 48 residential properties in southern
New Jersey. Among the rental units owned by Debtor is the
Property. The Debtor's business consists of acquiring and leasing
of residential real properties. Exhibit A is copy of a CMA Summary
Report dated May 11, 2020 setting the value of the Property at
$119,900.
As of the Petition Date, the Debtor was indebted to Corevest
American Finance Lender, LLC in the amount of $2,144,457 as set
forth in Proof of Claim No. 44 filed by Situs on Jan. 7, 2020.
As of the Petition Date, the Situs Claim is secured by a mortgage
against 18 of the Debtor's real properties, including the Property.
The Situs mortgage against the Property dated April 25, 2018 was
recorded on July 25, 2018 in the Atlantic County Clerk's Office in
Mortgage Book 14461, Page 1. The Situs Claim is also secured by
the rents from the real properties against which Situs possesses a
mortgage(s), including the Property.
The Title Report also reflects a judgment dated Nov. 6, 2019 in
favor of Fox Capital Group, Inc. in the amount of $193,708 against
a non-debtor entity by the name of TTK Real Estate Investments,
which entity is also owned by the Debtor's principal, Emily Vu.
In addition to the Situs mortgage against the Property being far in
excess of the value of the Property, the Fox Capital Judgment was
docketed subsequent to the Petition Date and is, therefore, void as
to the Debtor.
The Property has been listed for sale with the Debtor's Court
approved realtor, Century 21 Alliance, 1333 New Road, Suite 1,
Northfield, NJ, and has been actively marketed by Century 21. As
the result of the efforts of Century 21, the Debtor has entered
into a Contract for Sale of the Property (and Addendum thereto)
with the Purchaser for the sum of $140,000, subject to the approval
of the Court. The parties have executed their Contract for Sale
and Addendum. The Debtor proposes to sell the Property free and
clear of all liens, encumbrances, claims, and interests that may be
asserted by any entity claiming an interest therein, and other
claims or interests and transferring such claims to the proceeds of
sale.
The Debtor believes the $140,000 purchase price for the Property is
the highest and best offer which it will receive for the Property
and that it is in its best business judgment to proceed with the
sale of the Property to the Purchaser.
Except for all transfer Taxes associated with the sale or as
otherwise provided for in the Agreement, all costs relating to the
sale and settlement of the Property, including all searches and
title search fees, all survey fees, all title company settlement
charges and title insurance costs, will be the obligation of the
Purchaser at the time of closing.
All property taxes, all public utility charges, rents and like
charges, if any, relating to the Property will be pro-rated as of
Closing. Settlement at Closing will be made on proration of
estimates of such taxes and charges with net balances payable by
either Party at the time of closing.
The Parties recognize that the Debtor will be conveying title to
the Property, as a bankruptcy trustee acting in its capacity as DIP
nd that there is a full exemption in the New Jersey Realty Transfer
Fee under N.J.S.A. 46:15-5 et seq and N.J.A.C. 18:12-2.2 for deeds
given by a trustee in bankruptcy.
The Debtor submits that at the time of closing the proceeds of the
sale of the Property should be paid as follows: (i) normal costs
attendant with closing on the sale of the Property (real estate,
taxes, utilities, et.); (ii) 5% of the Purchase Price to Century
21, to be split equally with any participating/cooperating broker
in connection with the sale of the Property; and (iii) all
remaining proceeds to Situs on account of the Situs Secured Claim.
Finally, the Debtor asks that the stay of an order granting the
Motion under Bankruptcy Rule 6004(h) be waived for cause because
the Purchaser intends to close on July 8, 2020 and the Debtor is
concerned that the Purchaser will refuse to close if he cannot do
so by
that date.
A copy of the Contract is available at https://tinyurl.com/y7gztnfk
from PacerMonitor.com free of charge.
A hearing on the Motion was set for July 7, 2020 at 10:00 a.m.
About TTK RE Enterprise
TTK RE Enterprise LLC is a privately held company in Somers Point,
New Jersey. The Company is the 100% owner of 48 real estate
properties in New Jersey having a total current value of
$9,265,000.
TTK RE Enterprise sought Chapter 11 protection (Bankr. D.N.J. Case
No. 19-30460) on Oct. 29, 2019 in Camden, New Jersey. In the
petition signed by Emily K. Vu, president, the Debtor disclosed
total assets of $9,269,950, and total liabilities of $6,432,457.
Judge Jerrold N. Poslusny Jr. oversees the case. FLASTER GREENBERG
PC - CHERRY HILL is the Debtor's counsel.
TUESDAY MORNING: Contingent Sale Procedures for All Assets Approved
-------------------------------------------------------------------
Judge Harlin DeWayne Hale of the U.S. Bankruptcy Court for the
Northern District of Texas authorized the contingent sale
procedures of Tuesday Morning Corp. and its affiliates, in
adherence to the DIP Financing Milestones, in connection with the
sale of all or substantially all of the Debtors' inventory in the
Debtors' stores.
The terms and conditions approved by the Court with regard to the
Store Closing Sales Order, including but not limited to those
contained within Paragraph 33 of that Order, are incorporated by
reference and will govern in the event that the Debtors conduct a
sale of all of their inventory, except as modified by the Order.
The Committee will be entitled to the same objection rights as the
landlords and other interested parties provided in the referenced
Paragraph 33 of the Store Closing Sales Order.
Notwithstanding anything to the contrary therein, nothing in the
Order authorizes the use of cash collateral or debtor-in-possession
financing. Any payments authorized to be made pursuant to the
Motion will be made only to the extent authorized under the cash
collateral and DIP financing order approved by the Court in effect
as of the time such payment is to be made, and such payments will
be subject to the terms, conditions, limitations, and requirements
of the DIP Order in all respects.
Notwithstanding Bankruptcy Rules 6004(h) and 6006(d), to the extent
applicable, the Order will be effective and enforceable immediately
upon its entry.
A copy of the Procedures is available at
https://tinyurl.com/yar59rc6 from PacerMonitor.com free of charge.
About Tuesday Morning Corp.
Tuesday Morning Corporation, together with its subsidiaries, is a
closeout retailer of upscale home furnishings, housewares, gifts,
and related items. It operates under the trade name "Tuesday
Morning" and is one of the original "off-price" retailers
specializing in providing unique home and lifestyle goods at
bargain values. Based in Dallas, Tuesday Morning operated 705
stores in 40 states as of Jan. 1, 2020. For more information,
visit http://www.tuesdaymorning.com/
On May 27, 2020, Tuesday Morning and six affiliates sought Chapter
11 protection (Bankr. N.D. Tex. Lead Case No. 20-31476). Tuesday
Morning disclosed total assets of $92 million and total liabilities
of $88.35 million as of April 30, 2020.
The Hon. Harlin Dewayne Hale is the case judge.
The Debtors tapped Haynes and Boone, LLP as general bankruptcy
counsel; Alixpartners LLP as financial advisor; Stifel, Nicolaus &
Co., Inc. as investment banker; A&G Realty Partners, LLC as real
estate consultant; and Great American Group, LLC as liquidation
consultant. Epiq Corporate Restructuring, LLC is the claims and
noticing agent.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on June 9, 2020. The committee is represented by Munsch
Hardt Kopf & Harr, P.C.
U.S. TENNIS: Lays Off 110 Workers, Closes White Plains Office
-------------------------------------------------------------
SGB Media reports that the U.S. Tennis Association (USTA) announced
its plans of laying off 110 workers and to close its office in
White Plains, New York, as part of its restructuring amid the
COVID-19 pandemic.
With the cancellation of Wimbledon and the change of dates of the
French Open to later September, the decision on whether the US Open
will be played is due in mid-June. The tennis season is currently
suspended until July 31 due to coronavirus.
The restructuring plan is designed to streamline costs and focus
investments and people on supporting the grassroots of tennis, and
bringing the tennis community through the relief, recovery, and
rebuild phases of the pandemic. The plan also ensures that the
USTA's commitment to the US Open and all other USTA-produced events
will remain at a world-class level. The USTA is pivoting from a
program-based organization to a service-based organization with new
technologies, structures, and services designed to boost the entire
U.S. tennis ecosystem to help the sport thrive for the millions of
existing, and the attraction of new, tennis players.
In April, the USTA announced a comprehensive industry relief and
recovery package focused on supplying information and needed funds
for tennis facilities and providers to alleviate the hardships
caused by the financial effects of the COVID-19 pandemic. These
actions included identifying more than $20 million in savings by
instituting salary reductions of USTA management, furloughing
approximately 100 employees, cancelations of the USTA annual and
semi-annual meetings, eliminating programs in Marketing, Player
Development and Operations, and deferring all non-essential capital
projects. The industry relief continues with regular updates at
http://www.tennisindustyunited.com/ The next phase of the USTA's
plan will result in an additional $30 million in annual savings and
align national staff and its volunteer committee members towards
the strategic priorities of the USTA.
Patrick Galbraith, USTA chairman of the board and President, noted,
"In 2018 and 2019, the USTA Board of Directors began a process to
align with the USTA Sections and broader tennis ecosystem with a
long term Strategic Plan designed to bolster the organization's
mission and provide continuity of planning through 2026."
The plan development was an 18-month process that included an
extensive listening tour involving hundreds of interviews and
workshops. Ultimately, the USTA aligned against five strategic
choices:
1. Attract, Engage and Retain a New Generation of Diverse Tennis
Participants
2. Lead Industry-Wide Improvements to the Tennis Delivery
System, Provider Education and Consumer Experiences
3. Build and Optimize Best in Class Digital Infrastructure and
Platforms
4. Ensure Continued Financial Growth and Performance
5. Collaborate Within the USTA & Tennis Ecosystem for the Common
Good of Tennis
Galbraith continued, "With the finalization of the strategic plan
and the retirement of former CEO & ED Gordon Smith, we knew it was
of paramount importance to bring in a leader with both grassroots
tennis experience and a proven track record in restructuring an
organization of our size and breadth to assure the USTA was
properly positioned to execute the mission and our new strategic
choices. With Michael Dowse starting on January 1, 2020 we have
worked collaboratively to model the best structure to support the
USTA of the future."
Michael Dowse, USTA chief executive officer and Executive Director,
commented, "We have an opportunity to reimagine the structure of
the organization to better serve the tennis community in the United
States. This new structure allows the USTA to be more agile and
more cost effective, while getting closer to tennis players at the
local level. Tennis begins at the local level and our new structure
better empowers our unmatched network of volunteers, and private
and public tennis providers to deliver against our strategy of
attracting, engaging, and retaining a new generation of diverse
tennis players. Unfortunately, today represents a challenging day
for many of the USTA family who have been negatively affected by
the downsizing of the organization, and I would like to sincerely
thank each USTA staff member for their dedication to the
organization." The plan includes the following reduction in
expenses and key changes:
* 110 National positions will be eliminated via a reduction in
force and or taking advantage of the recently announced voluntary
departure program.
* The announced phased closing of the White Plains office with
remaining staff relocating to a yet to be determined new location
in New York.
* Significant cuts in business units and other investments that
are not aligned with the USTA's strategic priorities. This includes
merging player development, facilities, and USTA-U into Community
Tennis along with other downsizing initiatives.
* Significant reductions in meeting and travel expenses including
for the years 2021-2023 whereby the USTA will only host one live
attended meeting per calendar year for its volunteers and staff
across the country to meet and discuss key business initiatives.
* Exploration of a shared services platform to minimize and
eliminate redundancy of backroom expenses of Sections and Districts
thus allowing the strength of our Sectional and District volunteers
and local staffs to service and support local facilities,
providers, and players to grow the game.
The Tennis Service Platform will deliver a broad set of digital
tools to support all providers and facilities to attract, engage
and retain a new generation of tennis players. This tennis platform
will provide a wide variety of Marketing, Safety, and Educational
tools, as well as the Serve Tennis portal. The Serve Tennis portal
not only will replace TennisLink for Tournaments (January, 2021)
and Leagues and Junior Tennis Tournaments, it also will provide a
robust set of digital modules to manage Programming, Registration,
Communication, Court Booking, and Membership Management. Through
Serve Tennis and the Tennis Service Platform, the industry will be
able to dedicate more time to interacting with players on the
court, rather through administrative tasks. For more information go
to: www.usta.com/servetennis.
The USTA said it is committed to promoting and developing the
growth of tennis with the powerful combination of volunteers, the
US Open, and USTA Staff. This restructuring, using the strategic
priorities as the guiding principles, will allow the USTA to move
forward to drive the growth of tennis at every level.
VETERANS FELLOWSHIP: Sets Bid Procedures for Philly Property
------------------------------------------------------------
Veterans Fellowship Ministries, Inc., asks the U.S. Bankruptcy
Court for the District of Delaware to authorize the comprehensive
procedures facilitating its expeditious marketing program aimed at
selling its unimproved lot located at 3036-3040 N. 22nd Street,
Philadelphia, Pennsylvania via auction.
The Debtor's principal asset is the Philadelphia Property. There
is apparently a mortgage dated Dec. 9, 1987 encumbering the
Philadelphia Property which is held by Christian Tabernacle
Friendly Community Church, Inc. and the estate of Reuben T. Jones,
Sr. and Georgiana Jones (which mortgage the Debtor had understood
and believed had been paid and satisfied in full). As of the
Petition Date, the principal balance owed on the Mortgage was
$500,000. The Debtor did not include the Mortgage in its schedules
because the Debtor understood and believed that the Mortgage had
been paid and satisfied years ago.
In connection with the development and implementation of its plan
and in an effort to comply with the provisions of Section
1121(e)(3) of the Bankruptcy Code as it applies to a small business
debtor, the Debtor has embarked on an aggressive marketing program
aimed at an expeditious Sale of the Property. The Philadelphia
Property has been assessed by the City of Philadelphia as
approximately $316,000.
The Debtor has had five or six serious inquiries from interested
parties to date. Its counsel has negotiated two separate letters
of intent and obtained substantial security deposits from each
potential stalking horse bidder. The current highest and best
offer is $465,000.
The Debtor has now posted for sale signs on the Property and is
posting the Property on the internet to garner interest from
out-of-state investors. It will continue to market the Property
through the Bid Deadline. To bring this matter to a head and
thereby ask to maximize the value of the Property, the Debtor has
determined to continue to undertake its real estate-related sale
efforts, on an expedited basis.
The salient terms of the Bidding Procedures are:
a. Bid Deadline: Sept. 8, 2020 at 3:00 p.m. (ET)
b. Initial Bid: The Bidders' Baseline Bid will be in a an
amount not less than the sum of (a) consideration to be paid by the
Stalking Horse under the Stalking Horse Transaction Document(s);
plus (b) an initial overbid set forth in such Stalking Horse
Transaction Documents.
c. Deposit: 10% of the value of the aggregate consideration
being provided in the Bid
d. Auction: If more than one Qualified Bids is received by the
Debtor, it would plan to conduct an auction on Sept. 14, 2020 at
11:00 a.m. (ET), at the Regus Center, 1000 N. West Street, Suite
1200, Wilmington, DE 19801, or such other location as may be
determined by the Debtor.
e. Bid Increments: To be fixed by the Debtor
f. Sale Hearing: Sept. 21, 2020 at 10:00 a.m. (ET)
g. Closing: No later than Sept. 29, 2020
h. Break-Up Fee: 3% of the consideration to be paid
i. The terms of any Sale of the Property or Lease with an
Option to Purchase the Property will be on an "as is, where is"
basis and without representations or warranties of any kind,
nature, or description; and free and clear of all Claims, liens,
interests, and other Encumbrances, with such Encumbrances to attach
to the net consideration received by the Debtor from the Sale or
exercised Lease-Purchase Option in the same order of priority as
such Encumbrances encumbered the Property prior to the Petition
Date.
Within three days after entry of the Bidding Procedures Order, the
Debtor will serve notice ofthe Auction Approval Hearing, along with
the Bidding Procedures Order and the Bidding Procedures, upon the
Notice Parties.
In connection with the Sale, the Debtor may be required to assume
and assign certain executory contracts to the Successful Bidder. To
facilitate the assumption and assignment of any such executory
contracts and unexpired leases. Accordingly, the Debtor
respectfully asks that the Bankruptcy Court approves the assumption
and assignment of the Assumed Contracts. Within two days after
entry of the Bidding Procedures Order, the Debtor will serve on all
non-Debtor counterparties to any executory contract that may be
assumed and assigned to the Successful Bidder(s) a notice on the
Assumed Contracts.
The Debtor asks, pursuant to Bankruptcy Rules 6004(h) and 6006(d),
that the Bankruptcy Court expressly determines that the
effectiveness of any orders approving of the Motion not be stayed
and that the Bid Procedures Order and Auction Approval Order,
respectively, are effective immediately.
A copy of the Agreement is available at
https://tinyurl.com/yauo8nu3 from PacerMonitor.com free of charge.
About Veterans Fellowship Ministries
Veterans Fellowship Ministries filed a voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case
No. 19-10857) on April 16, 2019, disclosing under $1 million in
both assets and liabilities. Judge Brendan Linehan Shannon
oversees the case. The Debtor hired Montgomery McCracken Walker &
Rhoads, LLP as its legal counsel.
WATSON GRINDING: Trustee Seeks Approval to Hire Special Counsel
---------------------------------------------------------------
Janet S. Northrup, the Chapter 11 Trustee of Watson Grinding and
Manufacturing Co. seeks authority from the United States Bankruptcy
Court for the Southern District of Texas to retain a counsel.
The Trustee wishes to retain Matthew J. Borror, Esq. as special
ERISA counsel. The professional services that Mr. Borror will
render to the Trustee are limited to representation related to the
401(k) plan sponsored by the Debtor and he will be retained as
special counsel for that purpose.
The Trustee proposes to pay Borror from the 401(k) plan assets or
the bankruptcy estate as appropriate. The Trustee submits that
Borror's rate of $400 per hour is reasonable.
Mr. Borror is a "disinterested person" within the definition of
Section 101(14) of the Bankruptcy Code on the matters for which he
is to be engaged, according to court filings.
The counsel can be reached through:
Matthew J. Borror, Esq.
1205 McBain Ave.
Campbell, CA 95008
Phone: +1 408-206-8873
About Watson Grinding & Manufacturing
Watson Grinding & Manufacturing Co. --
http://www.watsongrinding.com/-- provides precision machined
parts, thermal spray coatings and grinding services to companies in
the oil and gas, chemical, and mining industries.
Watson Valve Services, Inc., -- http://watsonvalve.com/-- is a
turn-key OEM manufacturer of severe service ball valves.
Additionally, Watson Valve provides hydrostatic and pneumatic
pressure testing; oxygen service cleaning; on-site and off-site
installation support and troubleshooting; valve dis-assembly,
analysis, repair, and rebuilding; actuation system mounting and
installation; CNC and manual machining; grinding; thermal spray
coatings; coatings analysis; and non-destructive testing.
Watson Grinding and Watson Valve sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Tex. Case Nos. 20-30967 and
20-30968) on Feb. 6, 2020.
At the time of the filing, Watson Grinding disclosed assets of
between $10 million and $50 million and liabilities of the same
range. Watson Valve had estimated assets of between $10 million
and $50 million and liabilities of between $500,000 and $1
million.
Judge Marvin Isgur oversees the cases.
The Debtors tapped McDowell Hetherington, LLP and Jones, Murray &
Beatty, LLC, as their legal counsel.
On Feb. 21, 2020, the United States Trustee for the Southern
District of Texas appointed the Official Committee of January 24
Claimants. The Committee retained Porter Hedges LLP, and Burns
Bowen Bair LLP, as counsel.
WELBILT INC: Moody's Lowers CFR to Caa1 & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service downgraded the ratings of Welbilt, Inc.,
including the corporate family rating to Caa1 from B3 and
probability of default rating to Caa1-PD from B3-PD, as well as the
senior secured to B3 from B2 and the senior unsecured to Caa3 from
Caa2. The SGL-4 speculative grade liquidity rating remained
unchanged. The outlook was changed to stable from ratings under
review. This concludes the review for downgrade that was initiated
on April 13, 2020.
RATINGS RATIONALE
The ratings, including the Caa1 CFR, reflect Moody's expectation of
credit metrics to weaken substantially, likely into 2021, due to
weakness in Welbilt's primary restaurant end markets and macro
conditions, exacerbated by the coronavirus. Although end market
activity should pick up with the lifting of shelter-in-place orders
and support demand for Welbilt's products, the pandemic creates
considerable uncertainty around the timing of a full resumption of
demand for the company's products. Therefore, in Moody's view,
capital spending by Welbilt's customers is likely to be
meaningfully challenged for some time. The timing to achieve the
company's targeted savings from its business transformation program
is also likely to be delayed. Given these factors, Moody's expects
liquidity to remain weak, including negative free cash flow through
at least 2020, and debt/EBITDA could exceed 9x (all ratios
inclusive of Moody's standard adjustments) through 2021, a high
level for Welbilt's business risk.
Moody's recognizes the company's recent efforts to improve its
liquidity position, including a waiver amendment that suspended
certain revolver covenants through March 31, 2021, and other
measures to preserve cash. These include cost-cutting actions,
working capital management, lower capital spending and some
revolver borrowings. The cash balance of $149 million as of March
31, 2020, was up from $131 million as of December 31, 2019, and
availability on the $400 million revolver was $151 million.
However, the waiver amendment includes minimum liquidity
restrictions (non-China cash and available revolver), tested
quarterly, which may limit the company's full access to the cash if
cash flow further deteriorates. Given this and anticipated earnings
and cash flow headwinds with significant uncertainty around a
rebound, Moody's believes Welbilt will need to continue proactively
addressing its liquidity needs. Moody's also notes cash flow is
also likely to decline sharply in Q1 2021, typically the company's
lowest cash flow quarter.
Welbilt is well-positioned in its markets, based on good brand
recognition, diversification by product and global geographic
footprint, and its longstanding relationships with large restaurant
chains and dealers. The company also benefits from a large
installed base of equipment that provides a sizeable source of
aftermarket demand. Welbilt's cost reduction measures to help
offset the coronavirus impacts include permanent headcount
reductions expected to provide about $40 million in annualized
savings.
In terms of ESG considerations, Moody's views the coronavirus as a
social risk, given the implications for public health and safety
and its lingering uncertainty, which could further impact the
company's operating results. From a governance perspective, Welbilt
is publicly traded and has a primarily independent board.
The stable outlook considers the less-cyclical nature of the
food/equipment industry and Welbilt's exposure to better-positioned
QSRs (large chain customers) in the weak environment, which could
translate into higher capital spending with a meaningful pickup in
restaurant traffic over the next year.
Moody's took the following actions on Welbilt, Inc.:
Corporate Family Rating, downgraded to Caa1 from B3
Probability of Default Rating, downgraded to Caa1-PD from B3-PD
Senior Secured Bank Credit Facility, downgraded to B3 (LGD3)
from B2 (LGD3)
Senior Unsecured Notes, downgraded to Caa3 (LGD5) from Caa2
(LGD5)
Speculative Grade Liquidity Rating, unchanged at SGL-4
Outlook, changed to Stable from Ratings Under Review
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Upward ratings momentum is unlikely until demand and sales volumes
broadly increase along with a sustained improvement in business
conditions and end market fundamentals. Over time, the ratings
could be upgraded with expectations of stronger liquidity,
including consistent positive free cash flow generation and ample
revolver availability and covenant headroom. This would be
accompanied by sustained organic revenue growth and meaningful
margin expansion such that debt/EBITDA is expected to remain below
5.5x and free cash flow to debt at least in the mid-single digits
on a sustained basis.
The ratings could be downgraded if Moody's expects liquidity to
deteriorate, including a material decline in the cash balance,
diminishing revolver availability, covenant pressure heading into
2021, or expectations of negative annual free cash flow beyond
2020. Downward ratings pressure is also possible with expectations
of weakening operating performance such that interest coverage
metrics materially worsen or a lack of progress with meaningfully
reducing debt/EBITDA leverage.
The principal methodology used in these ratings was Manufacturing
Methodology published in March 2020.
Welbilt, Inc., based in New Port Richey, Florida, is a global
manufacturer and designer of commercial foodservice equipment,
including refrigeration, ice-making, cooking, and beverage
dispensing products for use in commercial food preparation
applications. Revenues approximated $1.55 billion for the last
twelve months ended March 31, 2020.
WEST COAST DISTRIBUTION: Committee Hires Financial Advisor
----------------------------------------------------------
The official committee of unsecured creditors of West Coast
Distribution, Inc. seeks approval from the U.S. Bankruptcy Court
for the Central District of California to retain Force Ten Partners
LLC as its financial advisor.
The firm's services will include:
1. analyzing Debtor's electronic and physical financial
records to determine the amount of money owed to it by its
principal and other parties;
2. analyzing Debtor's electronic and physical financial
records to determine if any money is owed by Debtor to certain
creditors;
3. analyzing Debtor's electronic and physical financial
records to determine the amount and extent of the lien or liens
asserted by its principal against the sale proceeds and any other
remaining assets of Debtor;
4. preparing and reviewing avoidable transfers;
5. assisting the committee with any offers to compromise,
settlement negotiations and litigation pertaining to the claims of
Debtor, which the committee is pursuing; and
6. participating as a witness in hearings before the
bankruptcy court.
The majority of the work will be performed by Adam Meislik and
Brian Weiss at their hourly rate of $650, by the firm's associates
and directors at hourly rates ranging from $325 to $495, and by
other staff, professionals and paraprofessionals at hourly rates
ranging from $195 to $295.
Adam Meislik, a partner at Force Ten, assured the court that the
firm is a "disinterested person" within the meaning of Section
101(14) of the Bankruptcy Code.
Force Ten may be reached at:
Adam Meislik
Force Ten Partners, LLC
20341 SW Birch, Suite 220
Newport Beach, CA 92660
Tel: (949) 357-2368
Mobile: (949)933-7011
About West Coast Distribution
West Coast Distribution Inc. is a full-service third party
logistics and supply chain management provider specializing in
apparel, retail and lifestyle brands.
West Coast Distribution sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Cal. Case No. 19-20332) on Aug. 30,
2019. 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.
The case is assigned to Judge Sheri Bluebond.
The Debtor tapped Levene, Neale, Bender, Yoo & Brill LLP as its
legal counsel; and Fineman West Co. LLP as its accountant.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on Sept. 30, 2019. The committee retained Weiland Golden
Goodrich LLP as counsel.
WG PARTNERS: Moody's Hikes Rating on $245MM Term Loan B to Ba3
--------------------------------------------------------------
Moody's Investors Service upgraded the rating on WG Partners
Acquisition, LLC's $245 million senior secured term loan B and its
$15 million senior secured revolving credit facility to Ba3 from
B1. The outlook is stable. These actions conclude the review for
upgrade that was initiated on June 16, 2020.
RATINGS RATIONALE
The rating action reflects Pacific Gas & Electric Company's July
1st emergence from bankruptcy by Pacific Gas & Electric Company
(PG&E) and its parent, PG&E Corporation (Ba2 stable; Corporate
Family Rating) as the utility completed its restructuring process.
Under the Plan of Reorganization, the utility will honor, or
assume, power purchase agreements (PPAs) with its electric
generation suppliers. This includes agreements with two of WGP's
six portfolio companies, the Three Sisters and the Five Brothers,
whose PPAs with PG&E expire in November 2020 and April 2022,
respectively. The two projects collectively amount to roughly 10%
of WGP's total cash flows through the term loan maturity in
November 2023. Both projects are operating well and received timely
payments from PG&E throughout the bankruptcy.
The rating action also acknowledges recent operational issues at
Hobbs, a 604-megawatt power plant in New Mexico, which had an
extended outage in July 2019 that has since been repaired. This
outage resulted in a cash trap at the Hobbs operating company level
restricting 2019 distributions that is expected to resolve during
2020. Despite forgoing the Hobbs distribution, WGP has maintained a
minimum debt service coverage ratio above its 1.1x senior debt
covenant.
RATING OUTLOOK
The stable outlook reflects the expectation that WGP will continue
to operate normally, resolving the cash distribution shortfall at
Hobbs and generating a debt service coverage ratio (DSCR) that is
comfortably above the 1.1x senior debt covenant.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade
WGP's rating could be upgraded if the projects repay debt more
quickly than expected and generate consolidated DSCR above 1.4x and
CFO to Adjusted Debt above 12% on a sustained basis.
Factors that could lead to a downgrade
A downgrade could also occur if the credit quality of the utility
off takers declines appreciably or if operational issues at any of
the WGP portfolio companies causes distribution shortfalls such
that consolidated DSCR metrics fall below 1.1x for a sustained
period.
PROFILE
Western Generation Partners, a holding company, owns a 1,502 MW
portfolio of twelve operating power generation plants spread over
four US states and the Republic of Trinidad and Tobago. The assets
consist of the 604 MW Hobbs power plant in New Mexico, the 225 MW
Trinity power plant in Trinidad and Tobago, the 72 MW Waterside
power plant in Connecticut, the 230 MW Borger plant in Texas, and a
net 371 MW portfolio of eight plants in California. All of the
projects are contracted with a portfolio weighted average remaining
life of around 10 years. The projects reached commercial operations
from 1988 through 2008 and use proven utility scale technology.
Hobbs, Waterside, Borger, and the Three Sisters assets had $239
million of operating company level debt at the end of 2019. WGP is
indirectly owned by a joint venture of funds managed by Harbert
Management Corporation (51%), UBS Asset Management (32%), and
Northwestern Mutual (17%).
RATING METHODOLOGY
The principal methodology used in these ratings was Power
Generation Projects published in June 2018.
YRC WORLDWIDE: Moody's Confirms Caa1 CFR, Outlook Stable
--------------------------------------------------------
Moody's Investors Service confirmed the ratings of truck carrier
YRC Worldwide Inc. following YRC's announcement that the United
States Department of Treasury intends to provide a $700 million
loan to YRC under authorization of the CARES Act. The ratings
include the Caa1 corporate family rating ("CFR"), the Caa1-PD
probability of default rating and the B1 senior secured rating. The
speculative grade liquidity rating was upgraded to SGL-3, from
SGL-4. The ratings outlook is stable.
The confirmation of YRC's ratings balances the additional liquidity
provided by the $700 million CARES Act loan and related amendments
to the company's existing revolving credit facility and term loan,
and the need to increase its earnings and cash flows sufficiently
to service the increase in the company's debt.
This completes the review for downgrade that was initiated on March
31, 2020.
RATINGS RATIONALE
The Caa1 CFR considers the company's position as one of the largest
less-than-truckload truck carriers in North America, thin operating
margins and substantial debt balance, in part due to Moody's
adjustments related to underfunded pension obligations. With a
fleet of more than 14,000 tractors and a nationwide footprint
comprising more than 350 terminals, YRC offers longer-haul
shipments as well as regional, next-day and time-sensitive
services. The $400 million of CARES Act funding earmarked for
capital investments will expedite the replacement of aging tractors
and trailers, yielding considerable cost savings through better
fuel economy and lower maintenance and repair expenses. Earnings
growth is also likely supported by the greater operational
flexibility under last year's labor contract with the International
Brotherhood of Teamsters and the company's ongoing network
optimization strategy. Nonetheless, YRC's operating margins are
typically very modest -- between 2.5% and 5% on a Moody's adjusted
basis - despite prior initiatives to increase the company's
profitability.
Calculated after Moody's standard adjustments, total debt will
increase by approximately 25% once all of the available funds under
the CARES Act loan are borrowed. Consequently, Moody's expects that
debt/EBITDA will be elevated in the near-term, before reverting to
approximately 7 times in 2021.
YRC's liquidity is adequate (SGL-3), despite the very limited
availability under the company's $450 million asset-based revolving
credit facility. Moody's estimates that the $300 million tranche A
of the CARES Act loan will be ample to cover deferred employee
healthcare and pension costs and other contractual obligations,
while the $400 million tranche B for investments in tractors and
trailers could help to sustain a greater cash balance over the next
12 to 18 months. Following the extension of the maturity of the
revolving credit facility until January 2024, there are no material
debt maturities until December 2022, when approximately $70 million
of obligations under the Contribution Deferral Agreement with
certain multiemployer pension plans are due. YRC also obtained a
waiver for the minimum EBITDA covenant of the $600 million term
loan until December 31, 2021, at which time the covenant will be
reinstated but at a level that Moody's believes YRC is unlikely to
breach.
The B1 senior secured rating reflects the relative priority of the
secured debt claim of the term loan and the high proportion of
unsecured liabilities in YRC's debt structure, which includes a
large estimated liability for defined benefit and multi-employer
pension plans, using Moody's methodology for calculating such
liability.
The stable outlook is predicated on Moody's expectation that YRC
will be able to increase its earnings in the next 12 to 18 months
such that (adjusted) debt/EBITDA will trend towards 7 times,
provided that the recovery in the US economy takes hold.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company improves (adjusted)
operating margins to levels that enable the company to undertake a
capital spending program of at least 5% of revenues, calculated on
a Moody's adjusted basis. Other considerations include debt/EBITDA
of less than 6 times, (FFO+interest)/interest of more than 2 times,
the ability to maintain adequate headroom under financial covenants
and maintaining ample cash.
The ratings could be downgraded if Moody's expects that (adjusted)
operating margins remain below 2.5% for a prolonged period or that
the company's cash balance diminishes to below $75 million. The
ratings could also be downgraded if Moody's expects debt/EBITDA to
remain in excess of 7 times or that (FFO+interest)/interest is less
than 1.5 times on a sustained basis.
Confirmations:
Issuer: YRC Worldwide Inc.
Corporate Family Rating, Confirmed at Caa1
Probability of Default Rating, Confirmed at Caa1-PD
Senior Secured Term Loan, Confirmed at B1 (LGD2)
Outlook Actions:
Issuer: YRC Worldwide Inc.
Outlook, Changed to Stable from Rating Under Review
The principal methodology used in these ratings was Surface
Transportation and Logistics published in May 2019.
YRC Worldwide Inc. is a provider of over-the-road transportation
services and has one of the largest less-than-truckload ("LTL")
transportation networks in North America. The company offers
longer-haul LTL shipments as well as regional, next-day and
time-sensitive services, with a total fleet of approximately 14,100
owned and leased tractors. Revenues in the last 12 months ended
March 31, 2020 were $4.8 billion.
[*] Bankruptcy Courts Accept Equitable Arguments for Rent Delays
----------------------------------------------------------------
Mary Katherine Fackler, Thomas Fullerton, John Mitchell, and
Michael Napoli of Akerman LLP wrote on JD Supra an article titled
"Bankruptcy Courts Continue to Accept Equitable Arguments for
Deferring Rent Payments During the COVID-19 Pandemic":
Previously we reported on debtors' appeals to bankruptcy courts'
general equitable powers for assistance in weathering the
COVID-19-induced economic storm. (Our original article may be
viewed here.) This trend remains and bankruptcy courts are
demonstrating a continued willingness to entertain and offer such
relief.
Unsurprisingly, over the past month or so bankruptcy filings have
increased primarily in the retail and hospitality spaces. J Crew,
J. C. Penney, Neiman Marcus, Hertz, Golds Gym, and many others
filed petitions under chapter 11 with varying degrees of support
from their stakeholders. We anticipate many more filings in the
retail space, especially in light of recent reports indicating that
only slightly more than 50% of commercial retail tenants paid rent
in April and May. Even seemingly strong corporations such as
Starbucks reportedly have notified landlords that the need exists
for rent deferral or abatement. The trickledown effect almost
certainly will create an additional round of bankruptcy filings
from landlords, mall owners, property management companies,
contractors, vendors, and others. No amount of government stimulus
will effectively bail out each industry, and some will suffer more
than others.
Whereas many landlords were willing and able to offer to tenants
rent deferral and even abatement, most concessions were limited to
90 days. After all, landlords can hold their lenders at bay only
for a limited period of time before the lender takes action to
realize upon its collateral. Moreover, stays on eviction
proceedings are expiring.
States are reopening—some far more rapidly than others. Even in
those states that have opened more quickly, such as Florida and
Texas, openings have slowed due to the ongoing national protests.
Thus, despite the easing of shelter-in-place restrictions, tenants
are still looking for lifelines from their landlords, insurance
companies, and state and bankruptcy courts. (While bankruptcy
courts have remained active, state courts are reopening and
tenant-defendants in forcible entry and detainer actions will seek
relief at the trial court level.) Landlords are being stretched
thin or are at the end of their rope. Insurance companies are
generally denying claims for business interruption losses as not
stemming from damage to property. (Some parties are responding with
creative arguments including that COVID-19 exists and is
transmitted on property surfaces and therefore property damage
exists. We are unaware of any courts directly addressing this
argument and decisions are likely months if not years away.) As
the ongoing fight for limited resources unfolds in state and
bankruptcy courts, what can we extract from recent opinions?
Decisions from bankruptcy courts in Illinois and Kansas offer many
points for consideration in navigating through these unprecedented
times.
Force Majeure Clause Leads to Partial Rent Abatement: Hitz
Restaurant Group (Bankruptcy Court for the Northern District of
Illinois)
Hitz Restaurant Group operates a restaurant in Chicago and on
February 24, 2020 filed a small business chapter 11 in response to
receiving a 5-day lease termination notice. Shortly after filing,
the restaurant's landlord brought motions to (i) compel payment of
post-petition rent under Bankruptcy Code Sec. 365(d)(3); and (ii)
modify the automatic stay under Sec. 362(d)(1). As rent payments
were due on or before the first of each month, the court deemed
February rent as prepetition and March and subsequent months
post-petition. As the court noted, the Bankruptcy Code usually
requires "full payment of the March 2020 rent and all rental
payments falling due thereafter." However, the lease contains the
following force majeure clause:
Landlord and Tenant shall be excused from performing its
obligations or undertakings provided in the Lease, in the event,
but only so long as the performance of any of its obligations are
prevented or delayed, retarded or hindered by . . . laws,
governmental action or inaction, orders of government . . . Lack of
money shall not be grounds for Force Majeure.
There were, of course, government orders and actions that hindered
the restaurant's ability to open and sell food. On March 16,
2020,[1] Illinois Governor J. B. Pritzker entered an executive
order specifically pertaining to restaurants, which required, among
other things, that they suspend service for on-premises
consumption. On the other hand, the order allows and encourages
restaurants to serve food and beverages via delivery, take-out, and
curbside pick-up, so that they may be consumed off-premises.
The court analyzed whether the Governor's order (similar to that in
many other localities) triggered the force majeure clause.
Initially, the court held that the lease's force majeure clause did
not excuse payment of March rent because the order was enacted on
the 16th and March rent was due on the 1st. Next, the court
considered the application of the force majeure clause on rent for
April, May and June.
The landlord advanced three primary arguments against application
of the force majeure clause.[2] The court dismissed all arguments
and found that the force majeure clause applies. It looked to
Illinois law on contract interpretation and further found that the
clause was only entitled to limited application. Specifically, the
court holds (emphasis added): "Debtor's obligation to pay rent is
reduced in proportion to its reduced ability to generate revenue
due to the executive order." The debtor conceded—without an
evidentiary hearing—that 25% of the restaurant's square footage
(consisting of the kitchen) could have been used for carry-out,
curbside pick-up, and delivery purposes. Thus, the court concludes
that the debtor owes 25% of the rent amount under Sec. 365(d)(3).
Lastly, the court is requiring payment on or before June 16 of 25%
of rent, common area maintenance (CAM), and property taxes for
April, May and June, otherwise "cause" would exist under §
362(d)(1) to lift the stay.
"Unprecedented Circumstances" Warrant Relief to Preserve Debtor's
Opportunity to Reorganize: Bread & Butter Concepts, LLC (Bankruptcy
Court for the District of Kansas)
A consolidated group of debtor restaurants operating in the Kansas
City area filed chapter 11 proceedings in November 2019 due to
decreasing sales, an increasing debt load, and mounting pressure
from landlords. According to the court, "[b]efore the coronavirus
pandemic struck, Debtors demonstrated potential for a successful
reorganization." On March 17, 2020, the debtors and all other area
restaurants were ordered to cease operations. Roughly one month
later, the debtors filed an emergency motion to suspend certain
Bankruptcy Code requirements including, without limitation, the
need to (1) pay postpetition rent to landlords; and (2) assume or
reject unexpired leases prior to the May 5th deadline.[3] The
debtors’ landlords objected.
The bankruptcy court cites to recent opinions in the Pier I
Imports, Inc. and Craftworks cases in stating that "no reasonable
alternative" exists and the relief sought offers "a short-term
allocation of those scarce resources to meet immediate needs and
preserve the value of the Debtors estates for all creditor
constituencies." Moreover, the court specifically cites to its
equitable powers in overriding the black letter of the Code:
These unprecedented circumstances require flexible application of
the Bankruptcy Code and exercise of the Court's equitable powers
under 11 U.S.C. Sec. 105 to grant further relief, including
extension of time to assume or reject the Debtors’ nonresidential
leases, notwithstanding the absence of written consent of the
lessors under 11 U.S.C. Sec. 365(d)(4)(B)(ii). Section 105(a) is
understood as providing courts with discretion to accommodate the
unique facts of a case consistent with the policies or directives
set by the other applicable substantive provisions of the
Bankruptcy Code.
In essence, the bankruptcy court exercised its equitable power in
overriding the landlords' statutory right to payment of
postpetition rent in favor of maintaining (1) the debtors'
perceived going-concern value and (2) prospects for recovery to all
creditors. And this is true despite the case having been filed
more than four months prior to entry of the shelter-in-place
orders.
The Take-away
The Hitz and Bread & Butter Concepts decisions further open the
door for tenant-friendly court opinions and should be closely
considered when engaging in lease-related negotiations. To be
sure, each situation is unique and must be examined individually.
The parties must consider a significant amount of variables, some
of which include:
(1) the lease's force majeure clause (find a detailed analysis of
these clauses and some state specific requirements here);
(2) the particular state’s timeline for reopening;
(3) the tenant's likelihood of recovery as a going concern;
(4) the current market for a replacement tenant;
(5) the landlord's ability and appetite to forbear; and
(6) any existing state and federal court binding precedent.
It is important to note that force majeure clauses are not
one-size-fits-all and may vary widely from one lease to another.
Perhaps the Hitz Restaurant Group wouldn't have fared as well if
the operative lease had been drafted to expressly carve-out from
the force majeure clause all of the tenant's rental and monetary
obligations. In addition, equity is examined on a case-by-case
basis with reference to the facts and circumstances.
In conclusion, under the Hitz analysis a tenant will argue that it
is operating at X% capacity due to the binding governmental
restrictions—i.e., maximum on-premises capacity is 10 or less
people, patrons must be at least 6 feet apart, etc. As a
consequence, the tenant should be required under the lease to pay a
corresponding X% of monetary obligations. These arguments are
likely to gain increased traction. It isn't difficult to see the
potential impact of the Hitz methodology on facilities such as
gyms, salons, bars, concert venues, and even educational, hospital,
assisted living, airline, rental car, hotel, and other similar
operations. Of course, every state is opening at a different pace.
Florida is reopening quickly and others are following. Illinois
has adopted a tiered approach. Nonetheless, tenants are likely to
argue in every state that significant restrictions remain.
Moreover, even if the force majeure clause in the operative lease
is not particularly debtor-friendly, the Pier I Imports,
CraftWorks, and Bread & Butter Concepts cases remind us that
bankruptcy courts maintain equitable discretion and are likely to
use it in a pro-debtor fashion for the foreseeable future. Plan and
negotiate accordingly.
[1] The sunset date of the order was later extended until May 29.
[2] The debtor's landlord argued: (1) the executive order did not
shut down the banking system or post offices and therefore the
debtor should have been able to write and send rental checks; (2)
debtor's failure to perform was due to a "lack of money" and
therefore did not meet the terms of the force majeure clause; and
(3) the debtor's failure to apply for a PPP loan prevents it from
enforcing the force majeure clause. The court called the first
argument specious and the second and third arguments misplaced
because (a) the executive order was the proximate cause of the
debtor's inability to generate revenue and pay rent and (b) the
lease plainly does not require the debtor to apply for a loan in
connection with seeking to rely upon the force majeure clause.
[3] The landlords had consented to a 60-day (from March 5)
extension to the statutory deadline to assume or reject under Code
Sec. 365(d)(4).
[*] BOOK REVIEW: Hospitals, Health and People
---------------------------------------------
Author: Albert W. Snoke, M.D.
Publisher: Beard Books
Softcover: 232 pages
List Price: $34.95
Order your personal copy today at
http://www.beardbooks.com/beardbooks/hospitals_health_and_people.html
Hospitals, Health and People is an interesting and very readable
account of the career of a hospital administrator and physician
from the 1930's through the 1980's, the formative years of today's
health care system. Although much has changed in hospital
administration and health care since the book was first published
in 1987, Dr. Snoke's discussion of the evolution of the modern
hospital provides a unique and very valuable perspective for
readers who wish to better understand the forces at work in our
current health care system.
The first half of Hospitals, Health and People is devoted to the
functional parts of the hospital system, as observed by Dr. Snoke
between the late 1930's through 1969, when he served first as
assistant director of the Strong Memorial Hospital in Rochester,
New York, and then as the director of the Grace-New Haven Hospital
in Connecticut. In these first chapters, Dr. Snoke examines the
evolution and institutionalization of a number of aspects of the
hospital system, including the financial and community
responsibilities of the hospital administrator, education and
training in hospital administration, the role of the governing
board of a hospital, the dynamics between the hospital
administrator and the medical staff, and the unique role of the
teaching hospital.
The importance of Hospitals, Health and People for today's readers
is due in large part to the author's pivotal role in creating the
modern-day hospital. Dr. Snoke and others in similar positions
played a large part in advocating or forcing change in our hospital
system, particularly in recognizing the importance of the nursing
profession and the contributions of non-physician professionals,
such as psychologists, hearing and speech specialists, and social
workers, to the overall care of the patient. Throughout the first
chapters, there are also many observations on the factors that are
contributing to today's cost of care. Malpractice is just one
example. According to Dr. Snoke, "malpractice premiums were
negligible in the 1950's and 1960's. In 1970, Yale-New Haven's
annual malpractice premiums had mounted to about $150,000." By the
time of the first publication of the book, the hospital's premiums
were costing about $10 million a year.
In the second half of Hospitals, Health and People, Dr. Snoke
addresses the national health care system as we've come to know it,
including insurance and cost containment; the role of the
government in health care; health care for the elderly; home health
care; and the changing role of ethics in health care. It is
particularly interesting to note the role that Senator Wilbur Mills
from Arkansas played in the allocation of costs of hospital-based
specialty components under Part B rather than Part A of the
Medicare bill. Dr. Snoke comments: "This was considered a great
victory by the hospital-based specialists. I was disappointed
because I knew it would cause confusion in working relationships
between hospitals and specialists and among patients covered by
Medicare. I was also concerned about potential cost increases. My
fears were realized. Not only have health costs increased in
certain areas more than anticipated, but confusion is rampant among
the elderly patients and their families, as well as in hospital
business offices and among physicians' secretaries." This aspect of
Medicare caused such confusion that Congress amended Medicare in
1967 to provide that the professional components of radiological
and pathological in-hospital services be reimbursed as if they were
hospital services under Part A rather than part of the co-payment
provisions of Part B.
At the start of his book, Dr. Snoke refers to a small statue,
Discharged Cured, which was given to him in the late 1940's by a
fellow physician, Dr. Jack Masur. Dr. Snoke explains the
significance the statue held for him throughout his professional
career by quoting from an article by Dr. Masur: "The whole question
of the responsibility of the physician, of the hospital, of the
health agency, brings vividly to mind a small statue which I saw a
great many years ago.it is a pathetic little figure of a man, coat
collar turned up and shoulders hunched against the chill winds,
clutching his belongings in a paper bag-shaking, tremulous,
discouraged. He's clearly unfit for work-no employer would dare to
take a chance on hiring him. You know that he will need much more
help before he can face the world with shoulders back and
confidence in himself. The statuette epitomizes the task of medical
rehabilitation: to bridge the gap between the sick and a job."
It is clear that Dr. Snoke devoted his life to exactly that
purpose. Although there is much to criticize in our current
healthcare system, the wellness concept that we expect and accept
today as part of our medical care was almost nonexistent when Dr.
Snoke began his career in the 1930's. Throughout his 50 years in
hospital administration, Dr. Snoke frequently had to focus on the
big picture and the bottom line. He never forgot the importance of
Discharged Cured, however, and his book provides us with a great
appreciation of how compassionate administrators such as Dr. Snoke
have contributed to the state of patient care today. Albert Waldo
Snoke was director of the Grace-New Haven Hospital in New Haven,
Connecticut from 1946 until 1969. In New Haven, Dr. Snoke also
taught hospital administration at Yale University and oversaw the
development of the Yale-New Haven Hospital, serving as its
executive director from 1965-1968. From 1969-1973, Dr. Snoke worked
in Illinois as coordinator of health services in the Office of the
Governor and later as acting executive director of the Illinois
Comprehensive State Health Planning Agency. Dr. Snoke died in April
1988.
*********
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