/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/200806.mbx T R O U B L E D C O M P A N Y R E P O R T E R Thursday, August 6, 2020, Vol. 24, No. 218 Headlines ACE AUTO: Case Summary & 20 Largest Unsecured Creditors AKORN INC: 1199SEIU Benefit Funds Object to Disclosure Statement ALKHAIRY PROPERTIES: Aug. 13 Hearing on Disclosure Statement ALL STAR MATERIALS: US Trustee Objects to Disclosure Statement ASCENA RETAIL: U.S. Trustee Appoints Creditors' Committee AVINGER INC: Prices $6M Underwritten Offering of Common Stock BILLINGS LODGE: U.S. Trustee Appoints Two New Committee Members BLACKRIDGE TECHNOLOGY INT'L: New Committee Member Appointed CHINOS HOLDINGS: Unsecureds to Get 50% in Debt-for-Equity Plan CPI CARD: Posts $112K Net Income in Second Quarter EMERGENT BIOSOLUTIONS: Moody's Assigns Ba2 CFR, Outlook Stable FITNESS INTERNATIONAL: Moody's Cuts CFR to Caa3, Outlook Still Neg. FORUM ENERGY: 96% of Existing 9% Convertible Notes Validly Tendered FRONTIER COMMUNICATIONS: Wilmington Savings Objects to Disclosures HUDSON TECHNOLOGIES: Board Approves Termination of CRO HUDSON TECHNOLOGIES: Posts $2.4M Net Income in Second Quarter JACOBSON HOTELS: Voluntary Chapter 11 Case Summary JASON INDUSTRIES: Unsecured Claims Unimpaired in Plan JONESBORO TRACTOR: Kubota Contracts May Be Assumed, Court Rules K & L TRAILER LEASING: Trustee Taps Bradley Avant as Legal Counsel K & L TRAILER LEASING: Trustee Taps Resurgence as Financial Advisor K & L TRAILER SALES: Trustee Taps Bradley Arant as Legal Counsel K & L TRAILER SALES: Trustee Taps Resurgence as Financial Advisor KIMBLE DEVELOPMENT: Unsecured Claims Unimpaired in Plan LAPEER INDUSTRIES: Voluntary Chapter 11 Case Summary LAPLACE VETERINARY: Sept. 9 Hearing on Disclosures and Plan LIBBEY GLASS: Unsecured Creditors to Get Share of Cash Pool MANNKIND CORP: Incurs $10.3 Million Net Loss in Second Quarter MEN'S WEARHOUSE: Moody's Cuts PDR to D-PD on Chapter 11 Filing MOUNTAIN STATES ROSEN: May Sell Assets to Swift Beef for $14.25M MURRAY METALLURGICAL: Joy Global, IDC Industries Leave Committee OCCASION BRANDS: U.S. Trustee Appoints Creditors' Committee OFFICE UPRISING: Plan Confirmation Hearing on Aug. 12 POWER SOLUTIONS: Pays Out $750K Executive Bonuses in 2019 PRESTIGE HEATING: Unsecureds get Prorata Cash Payments of $4500 PROMISE HEALTHCARE: Unsecureds may Recover 11-36% of its Claim QUOTIENT LIMITED: Reports First Quarter Fiscal 2021 Results RAVN AIR: Unsecureds Will Get Prorata Share of Creditors Fund RICHARD M. KERGER: District Court Retains Tax Liability Cases ROSE COURT: First Amended Suit vs Select Portfolio et al. Tossed SFP FRANCHISE: Aug. 10 Combined Hearing on Plan & Disclosures SHEPPARD AND SON: Creditors to Be Paid in Full With Interest STOKES INC: Seeking to Continue Proceedings Under CCAA SUNOPTA INC: Reports $1.6 Million Net Loss for Second Quarter SUNPOWER CORP: Posts $19.4 Million Net Income in Second Quarter SUNPOWER CORP: TZS Deposits $84.2M of Purchase Price Into Escrow TERRANCE J. MCCLINCH: Maine Bankr. Court To Hear Palsa Suit TRANS WORLD: Incurs $5.41 Million Net Loss in First Quarter TRC FARMS: Unsec. Creditors to Be Paid in Full in 10 Years in Plan TRIUMPH GROUP: Moody's Cuts CFR to Caa3 & 2nd Lien Notes to Caa2 UA LOCAL 91: D&Z Defendants Dismissed from King Class Suit UNIVERSAL TOWERS: U.S. Trustee Unable to Appoint Committee VERITAS BERMUDA: Moody's Affirms B3 CFR, Outlook Stable VIVUS INC: Appointment of Equity Committee Sought VTV THERAPEUTICS: Incurs $3.37 Million Net Loss in Second Quarter WC 4TH AND COLORADO: Case Summary & 15 Unsecured Creditors XEROX CORP: Fitch Alters Outlook on BB LongTerm IDR to Negative YRC WORLDWIDE: Incurs $37.1 Million Net Loss in Second Quarter [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* ACE AUTO: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------- Debtor: Ace Auto Recovery, Inc. 1209 North Lane Avenue Jacksonville, FL 32254 Business Description: Ace Auto Recovery, Inc. is a towing service provider in Jacksonville, Florida. Chapter 11 Petition Date: August 4, 2020 Court: United States Bankruptcy Court Middle District of Florida Case No.: 20-02328 Debtor's Counsel: Jason A. Burgess, Esq. THE LAW OFFICES OF JASON A. BURGESS, LLC 1855 Mayport Road Atlantic Beach, FL 32233 Tel: (904) 372-4791 Email: jason@jasonAburgess.com Total Assets: $1,112,996 Total Liabilities: $1,835,999 The petition was signed by Michael R. Steinman Sr., 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/oI0xTF AKORN INC: 1199SEIU Benefit Funds Object to Disclosure Statement ---------------------------------------------------------------- 1199SEIU Benefit Funds, DC47 Fund and SBA Fund jointly object to the adequacy of Akorn Inc., et al.'s Disclosure Statement. 1199SEIU Benefit Funds assert that: * the Disclosure does not provide adequate information about the MDL. * the Disclosure does not provide adequate information about the releases and injunctions. * the Disclosure does not provide adequate information about treatment of unsecured creditors. * the Plan is patently unconfirmable because it was proposed in bad faith. Attorneys for 1199SEIU National Benefit Fund, 1199SEIU Greater New York Benefit Fund, 1199SEIU National Benefit Fund for Home Care Workers, and 1199SEIU Licensed Practical Nurses Welfare Fund; AFSCME District Council 47 Health and Welfare Fund; and Sergeants Benevolent Association Health and Welfare Fund: Leslie Spoltore, Esquire Edmond M. George, Esquire Michael D. Vagnoni, Esquire Turner N. Falk, Esquire Obermayer Rebmann Maxwell & Hippel LLP 123 S. Justison Street, Suite 100 Wilmington, DE 19801-5364 About Akorn Inc. Akorn, Inc. -- http://www.akorn.com/-- is a specialty pharmaceutical company that develops, manufactures, and markets generic and branded prescription pharmaceuticals, branded as well as private-label over-the-counter consumer health products, and animal health pharmaceuticals. Akorn is headquartered in Lake Forest, Illinois, and maintains a global manufacturing presence, with pharmaceutical manufacturing facilities located in Illinois, New Jersey, New York, Switzerland, and India. Akorn, Inc., and 16 affiliates sought Chapter 11 protection (D. Del. Lead Case No. 20-11177) on May 20, 2020. As of March 31, 2020, the Debtors had total assets of $1,032,275,000, and total debt of $1,051,769,000. The cases are assigned to Judge John T. Dorsey. The Debtors tapped Kirkland & Ellis LLP as general bankruptcy counsel, and Richards, Layton & Finger, P.A. as local counsel. AlixPartners, LLP serves as the Debtors' restructuring advisor, and PJT Partners LP is the financial advisor and investment banker. Grant Thornton LP is the tax advisor, and Kurtzman Carson Consultants, LLC, is the claims agent. ALKHAIRY PROPERTIES: Aug. 13 Hearing on Disclosure Statement ------------------------------------------------------------ Judge Robert E. Grant will hold a hearing on Aug. 13, 2020 at 10:50 am in Room 2127, Federal Building, 1300 South Harrison Street, Fort Wayne, Indiana, to consider the approval of the amended Disclosure Statement of Alkhairy Properties LLC. Any objection to the amended Disclosure Statement must be filed and served no later than seven days prior to the hearing. About Alkhairy Properties Alkhairy Properties LLC sought Chapter 11 protection (Bankr. N.D. Ind. Case No. 19-10942) on May 24, 2019, estimating less than $1 million in assets and up to $50,000 in liabilities. R. David Boyer II, Esq., at BOYER & BOYER, is the Debtor's counsel. ALL STAR MATERIALS: US Trustee Objects to Disclosure Statement -------------------------------------------------------------- The United States Trustee for Region 21 objects to final approval of Disclosure Statement and confirmation of Amended Chapter 11 Plan of Reorganization filed by All Star Materials, LLC and Magnum Materials, LLC. The United States Trustee points out that the Amended Plan does not appear to address the concerns raised in the UST Objection. The United States Trustee further points out that the Debtor did not amend or supplement its Disclosure Statement. The U.S. Trustee asserts that the Debtor had only $5,550.07 in cash on hand, and the Amended Plan does not contemplate any infusion of cash into the Debtor's business. The U.S. Trustee complains that the projections included with the Disclosure Statement are vastly different from the Debtor's financial performance during this case without any explanation or justification. According to the United States Trustee, it does not appear that the Debtor can pay its current operating expenses and make the payments contemplated in its Amended Plan. About All Star Materials All Star Materials, LLC, is a foreign limited liability company organized under the laws of the State of Delaware and authorized to transact business in Florida since March 8, 2019. It has been in the business of production and sale of construction materials such as concrete block, aggregate, dirt and fill products. Magnum Materials sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 19-03010) on May 3, 2019. All Star Materials filed a voluntary Chapter 11 petition (Bankr. M.D. Fla. Case No. 19-05191) on Aug. 7, 2019. The Debtors are represented by: Jeffrey S. Ainsworth, Esquire BransonLaw, PLLC 1501 E. Concord Street Orlando, Florida 32803 Tel: (407) 894-6834 Fax: (407) 894-8559 E-mail: jeff@bransonlaw.com ASCENA RETAIL: U.S. Trustee Appoints Creditors' Committee --------------------------------------------------------- The Office of the U.S. Trustee on Aug. 3, 2020, appointed a committee to represent unsecured creditors in the Chapter 11 cases of Ascena Retail Group, Inc. and its affiliates. The committee members are: 1. The Taubman Company 200 East Long Lake Road, Suite 300 Bloomfield Hills, MI 48304-2324 2. Snogen Green Co., Ltd. 12, Gwangpyeong-ro 56-gil Gangnam-Gu Seoul, Korea 06367 3. Brookfield Properties Retail, Inc. 350 N. Orleans Street, Suite 300 Chicago, Il 60654-1607 4. Amanda Meo c/o Gregg Schavitz, Esq. Shavitz Law Group, P.A. 951 Yamato Road, Suite 285 Boca Raton, Florida 33431 5. Lakontra International Merchandising Corp. No. 186 Sec. 4 Nankinge Rd. Taipei, Taiwan 6. Li & Fung Limited 888 Cheung Sha Wan Road Kowloon, Hong Kong 7. Washington Prime Group, Inc. 180 East Broad Street Columbus, Ohio 43215 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 Ascena Retail Group Ascena Retail Group, Inc. (Nasdaq: ASNA) is a national specialty retailer offering apparel, shoes, and accessories for women under the Premium Fashion (Ann Taylor, LOFT, and Lou & Grey), Plus Fashion (Lane Bryant, Catherines and Cacique), and Value Fashion (Dressbarn) segments, and for tween girls under the Kids Fashion segment (Justice). Ascena, through its retail brands, operates ecommerce websites and approximately 2,800 stores throughout the United States, Canada, and Puerto Rico. Visit http://www.ascenaretail.comfor more information. Ascena Retail reported a net loss of $661.4 million for the fiscal year ended Aug. 3, 2019, a net loss of $39.7 million for the year ended Aug. 4, 2018, and a net loss of $1.06 billion for the year ended July 29, 2017. On July 23, 2020, Ascena Retail Group and its affiliates sought Chapter 11 protection (Bankr. E.D. Va. Case No. 20-33113). As of Feb. 1, 2020, Ascena Retail had $13,690,710,379 in assets And $12,516,261,149 in total liabilities. The Hon. Kevin R. Huennekens is the case judge. Debtors have tapped Kirkland & Ellis LLP and Cooley LLP as bankruptcy counsel, Guggenheim Securities, LLC as financial Advisor, and Alvarez and Marsal North America, LLC as restructuring advisor. Prime Clerk, LLC is the claims agent. AVINGER INC: Prices $6M Underwritten Offering of Common Stock ------------------------------------------------------------- Avinger, Inc. reports the pricing of an underwritten public offering with gross proceeds to the Company expected to be approximately $6 million before deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company. The proposed offering equates to 15,789,474 shares of the Company's common stock at a price of $0.38 per share. The Company intends to use the net proceeds from this offering for working capital and general corporate purposes, which may include research and development of the Company's Lumivascular platform products, preclinical and clinical trials and studies, regulatory submissions, expansion of sales and marketing organizations and efforts, intellectual property protection and enforcement and capital expenditures. The Company has not yet determined the amount of net proceeds to be used specifically for any particular purpose or the timing of these expenditures. The Company may use a portion of the net proceeds to acquire complementary products, technologies or businesses or to repay principal on its debt; however, the Company currently has no agreements or commitments to complete any such transactions or to make any such principal repayments and is not involved in negotiations to do so. The Company has also granted the underwriters a 45-day option to purchase up to an additional 15% of the number of shares of common stock offered in the public offering to cover over-allotments, if any, at the public offering price. The offering is expected to close on or about Aug. 6, 2020, subject to customary closing conditions. Aegis Capital Corp. is acting as sole bookrunner for the offering. This offering is being made pursuant to an effective shelf registration statement on Form S-3 (No. 333-230124) previously filed with the U.S. Securities and Exchange Commission and declared effective by the SEC on March 29, 2019. A final prospectus supplement and accompanying prospectus describing the terms of the proposed offering will be filed with the SEC and will be available on the SEC's website located at http://www.sec.gov. Electronic copies of the final prospectus supplement and the accompanying prospectus, when available, may be obtained by contacting Aegis Capital Corp., Attention: Prospectus Department, 810 7th Avenue, 18th floor, New York, NY 10019, by email at prospectus@aegiscap.com, or by telephone at (212) 813-1010. Before investing in this offering, interested parties should read in their entirety the prospectus supplement and the accompanying prospectus and the other documents that the Company has filed with the SEC that are incorporated by reference in such prospectus supplement and the accompanying prospectus, which provide more information about the Company and such offering. About Avinger Headquartered in Redwood City, California, Avinger -- http://www.avinger.com/-- is a commercial-stage medical device company that designs and develops image-guided, catheter-based system for the diagnosis and treatment of patients with Peripheral Artery Disease (PAD). Avinger reported a net loss applicable to common stockholders of $23.03 million for the year ended Dec. 31, 2019, compared to a net loss applicable to common stockholders of $35.69 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $28.88 million in total assets, $21.33 million in total liabilities, and $7.55 million in total stockholders' equity. Moss Adams LLP, in San Francisco, California, the Company's auditor since 2017, issued a "going concern" qualification in its report dated March 5, 2020, citing that the Company's recurring losses from operations and its need for additional capital raise substantial doubt about its ability to continue as a going concern. BILLINGS LODGE: U.S. Trustee Appoints Two New Committee Members --------------------------------------------------------------- The Office of the U.S. Trustee on Aug. 4 appointed Billings Tennis Association and John Waggoner as new members of the official committee of unsecured creditors in the Chapter 11 case of Billings Lodge No. 394 Benevolent and Protective Order of Elks of United States of America. The members of the committee as of Aug. 4 are: 1. Billings Tennis Association Eileen Pinkteron, President P.O. Box 21381 Billings, MT 59104 2. John Waggoner 2918 Rimrock Rd. Billings, MT 59102 3. James Bennett 3840 Rimrock Rd., Apt. 2216 Billings, MT 59106 4. Duncan Burford 3856 Avenue C Billings, MT 59102 5. Russ Fagg 3053 Thousand Oaks St. Billings, MT 59102 6. Jeanette Moran 1424 Parkhill Dr. Billings, MT 59102 About Billings Lodge No. 394 Billings Lodge, No. 394, Benevolent and Protective Order of Elks of United States of America, Inc. is a tax-exempt civic and social organization. Elk Lodge is a Billings, Montana-based fraternal organization that hosts various civic events and social gatherings like wedding receptions, meetings, and other functions. Billings Lodge filed a voluntary Chapter 11 bankruptcy petition (Bankr. D. Mon. Case No. 20-10110) on June 5, 2020. The petition was signed by Jeffery R. Isom, exalted ruler. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Debtor has tapped Felt Martin PC as counsel; Heidi Giem of Paigeville Accounting, LLC as accountant; and David Goodridge with Real Estate by Hamwey as its real estate broker. The Office of the U.S. Trustee appointed a committee of unsecured creditors on July 23, 2020. BLACKRIDGE TECHNOLOGY INT'L: New Committee Member Appointed ----------------------------------------------------------- The U.S. Trustee for Region 17 on Aug. 3, 2020, appointed Robert Bantle as new member of the official committee of unsecured creditors in the Chapter 11 cases of BlackRidge Technology International, Inc. and BlackRidge Technology Holdings, Inc. Chowdary Yalamanchili, one of the unsecured creditors appointed on April 29, is no longer a member of the committee, according to court filings. As of Aug. 3, the committee is composed of: 1. Robert Bantle 365 Post Road Darier, CT 06820 2. Krishna Adusumilli Attn: John P. Melko, Esq. 1000 Louisiana St., Ste. 2000 Houston, TX 77002 3. Softgate International Attn: David Foy 2394 Mariner Square Drive, #A1 Alameda, CA 94501 About Blackridge Technology International Blackridge Technology International develops, markets, and supports a family of products that provide a next generation cyber security solution for protecting enterprise networks and cloud services. Blackridge Technology International filed a voluntary Chapter 11 petition (Bankr. D. Nev. Case No. 20-50314) on March 13, 2020. In the petition signed by Robert J. Graham, president, Debtor estimated $10 million to $50 million in both assets and liabilities. Judge Bruce T. Beesley oversees the case. Stephen R. Harris, Esq., at Harris Law Practice LLC, is the Debtor's legal counsel. The Office of the U.S. Trustee for Region 17 appointed a committee of unsecured creditors on April 29, 2020. CHINOS HOLDINGS: Unsecureds to Get 50% in Debt-for-Equity Plan -------------------------------------------------------------- Chinos Holdings, Inc. and its debtor affiliates submitted a Plan and a Joint Disclosure Statement. Each holder of an Allowed ABL Facility Claim will receive cash in the full amount of its Allowed ABL Facility Claim. Each holder of an Allowed Term Loan Secured Claim will receive its pro rata share of the common shares of Reorganized Chinos Holdings (the "New Common Shares") representing, in the aggregate, 76.5% of the New Common Shares issued on the Effective Date remaining after distribution on account of the Backstop Premium and the New Equity Allocation, and of any other New Common Shares distributed pursuant to the Plan (other than the New Common Shares distributed to holders of IPCo Notes Claims as described below), subject to dilution from New Common Shares (i) issuable upon exercise of the New Warrants, (ii) issued pursuant to the Management Incentive Plan, and (iii) otherwise issued by the Reorganized Debtors after the Effective Date, including the Incremental Debt Equity. Each holder of an Allowed IPCo Notes Claim will receive its pro rata share of New Common Shares representing, in the aggregate, 23.5% of the New Common Shares issued on the Effective Date remaining after distribution on account of the Backstop Premium, the New Equity Allocation, and of any other New Common Shares distributed pursuant to the Plan (other than the New Common Shares distributed to holders of Term Loan Secured Claims as described above), subject to dilution from New Common Shares (i) issuable upon exercise of the New Warrants, (ii) issued pursuant to the Management Incentive Plan, and (iii) otherwise issued by the Reorganized Debtors after the Effective Date, including the Incremental Debt Equity. Each holder of a general unsecured claims that will provide goods and services necessary to the operation of the Reorganized Debtors, as determined by the Debtors in consultation with the Requisite Consenting Support Parties5 (the "Ongoing Trade Claims") and that has executed a trade agreement that expressly designates such party as a holder of an Ongoing Trade Claim,6 will on the Effective Date receive its pro rata share of $71 million in cash; provided that the aggregate amount of cash distributed on account of any Ongoing Trade Claim will not exceed 50% of the allowed amount of such Claim. Holders of Other General Unsecured Claims, which include rejection damages claims and the Term Loan Deficiency Claims, will, on the Effective Date, receive their pro rata share of cash allocable to the applicable Debtor from a cash pool that will aggregate (a) $3 million if the class votes to accept the Plan and (b) $1 million if the class votes to reject the Plan; provided, that the aggregate amount of cash distributed on account of any Other General Unsecured Claim will not exceed 50% of the allowed amount of such Claim. On the Effective Date, all Existing Holdings Preferred Equity and Existing Holdings Equity shall be cancelled and will be of no further force and effect, regardless of whether surrendered for cancellation. The Reorganized Debtors will have sufficient funds to make the distributions required under the Plan and funds will be available to them under the Exit ABL Facility and the New Term Loans. A full-text copy of the Joint Disclosure Statement dated June 24, 2020, is available at https://tinyurl.com/y75yl8k2 from PacerMonitor.com at no charge. Attorneys for the Debtors: Ray C. Schrock, P.C. Ryan Preston Dahl Candace M. Arthur Daniel Gwen WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone: (212) 310-8000 Facsimile: (212) 310-8007 Attorneys for the Debtors: Tyler P. Brown Henry P. (Toby) Long, III Nathan Kramer HUNTON ANDREWS KURTH LLP Riverfront Plaza, East Tower 951 East Byrd Street Richmond, Virginia 23219 Telephone: (804) 788-8200 Facsimile: (804) 788-8218 About J.Crew Group J.Crew Group, Inc., is an internationally recognized omni-channel retailer of women's, men's and children's apparel, shoes and accessories. As of May 4, 2020, the Company operated 181 J.Crew retail stores, 140 Madewell stores, jcrew.com, jcrewfactory.com, madewell.com and 170 factory stores. J.Crew Group, Inc., and 17 related entities, including its parent, Chinos Holdings, Inc., sought Chapter 11 protection on May 4, 2020 after reaching agreement with lenders on a deal that will convert approximately $1.65 billion of the Company's debt into equity. The lead case is In re Chinos Holdings, Inc. (Bankr. E.D. Va. Lead Case No. 20-32181). J.Crew was estimated to have at least $1 billion in assets and liabilities as of the bankruptcy filing. Weil, Gotshal & Manges LLP is serving as legal counsel, Lazard is serving as investment banker and AlixPartners, LLP is serving as restructuring advisor to J.Crew Group, Inc. Anchorage Capital Group and other members of an ad hoc committee are represented by Milbank LLP as legal counsel and PJT Partners LP as investment banker. Omni Agent Solutions is the claims agent. The official committee of unsecured creditors appointed in Debtors' bankruptcy cases tapped Pachulski Stang Ziehl & Jones LLP as legal counsel; Hirschler Fleischer, P.C. as local counsel; and Province, Inc. as financial advisor. CPI CARD: Posts $112K Net Income in Second Quarter -------------------------------------------------- CPI Card Group Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting net income of $112,000 on $71.38 million of total net sales for the three months ended June 30, 2020, compared to net income of $1.52 million on $66.90 million of total net sales for the three months ended June 30, 2019. For the six months ended June 30, 2020, the Company reported net income of $2.53 million on $145.35 million of total net sales compared to a net loss of $1.53 million on $133.77 million of total net sales for the same period during the prior year. As of June 30, 2020, the Company had $246.50 million in total assets, $396.36 million in total liabilities, and a total stockholders' deficit of $149.85 million. "Our hearts go out to those impacted by the COVID-19 pandemic," said Scott Scheirman, president and chief executive officer of CPI. "Amid a highly challenging environment, I'm proud of the way our organization has demonstrated an unwavering commitment to the health and safety of our employees and the community. All of CPI's facilities have been operating and continue to provide essential products and services to the financial services industry, including the production, personalization and fulfillment of debit, credit, and prepaid cards." Scheirman added, "Our results reflect the significant progress we have made executing against our strategic priorities, resulting in top-line growth of 7% year-over-year through unprecedented times. In the second quarter, we delivered strong net sales growth due to our differentiated products and solutions, such as our dual interface EMV Second WaveTM product, our card made with recovered ocean-bound plastic. We continue to develop and launch innovative solutions. We announced with Visa the introduction of our Earthwise High Content Card, a more sustainable payment card made with up to 98 percent upcycled plastic. Additionally, we recently launched Spectrum by Card@Once, expanding our Software-as-a-Service instant issuance solution to enable financial institutions to instantly issue debit and credit cards with vibrant, high-definition image quality." Scheirman continued, "We remain focused on being the partner of choice by providing market-leading quality products and customer service with a market-competitive business model." As of June 30, 2020, cash and cash equivalents was $54.4 million. Cash provided by operating activities was $8.8 million and capital expenditures were $0.7 million in the second quarter of 2020, yielding Adjusted Free Cash Flow of $8.1 million. This compares with the second quarter of 2019, when cash provided by operating activities was $9.2 million inclusive of $6.0 million cash received from a litigation settlement, and capital expenditures of $0.5 million resulting in Adjusted Free Cash Flow of $2.7 million. In the second quarter of 2020, Adjusted Free Cash Flow increased $5.4 million year-over-year. For the first half, cash provided by operating activities was $12.0 million, capital expenditures were $1.6 million and Adjusted Free Cash Flow was $10.4 million. Total long-term debt principal outstanding, comprised of the Company's $30 million Senior Credit Facility and its $312.5 million First Lien Term Loan, was $342.5 million at June 30, 2020. Net of debt issuance costs and discount, total long-term debt was $334.8 million as of June 30, 2020. The Company's Senior Credit Facility matures in May 2022 and the First Lien Term Loan matures in August 2022. John Lowe, chief financial officer of CPI, said, "Despite the ongoing COVID-19 pandemic and economic uncertainty, solid execution led to 7% year-over-year top-line growth and another quarter of positive Adjusted Free Cash Flow. As we continue to navigate economic uncertainty, we remain committed to our customer-centric approach and executing our strategic plan." A full-text copy of the Form 10-Q is available for free at: https://is.gd/dzUQps About CPI Card CPI Card Group -- http://www.cpicardgroup.com/-- is a payment technology company and provider of credit, debit and prepaid solutions delivered physically, digitally and on-demand. CPI helps its customers foster connections and build their brands through innovative and reliable solutions, including financial payment cards, personalization and fulfillment, and Software-as-a-Service (SaaS) instant issuance. CPI has more than 20 years of experience in the payments market and is a trusted partner to financial institutions and payments services providers. Serving customers from locations throughout the United States, CPI has a large network of high security facilities, each of which is registered as PCI Card compliant by one or more of the payment brands: Visa, Mastercard, American Express, and Discover. CPI Card reported a net loss of $4.45 million for the year ended Dec. 31, 2019, compared to a net loss of $37.46 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $213.49 million in total assets, $365.9 million in total liabilities, and a total stockholders' deficit of $152.4 million. * * * As reported by the TCR on April 17, 2020, S&P Global Ratings affirmed its 'CCC+' issuer credit rating on CPI Card Group Inc. "The affirmation reflects our view that CPI's capital structure remains unsustainable given its high debt leverage, limited cash flow generation, and the need to substantially improve its operating performance to repay its 2022 debt maturities," S&P said. In March 2020, Moody's Investors Service affirmed CPI Card Group Inc.'s Caa1 Corporate Family Rating. The ratings affirmation on the CFR, PDR and existing term loan rating reflects Moody's expectation of volume growth in the company's core secure card business as the replacement cycle of initially issued EMV card continues, as well as modest conversion to dual interface cards as they become a larger part of the overall payment card market. EMERGENT BIOSOLUTIONS: Moody's Assigns Ba2 CFR, Outlook Stable -------------------------------------------------------------- Moody's Investors Service assigned first-time ratings to Emergent BioSolutions Inc. including a Ba2 Corporate Family Rating, a Ba2-PD Probability of Default Rating, a Ba3 senior unsecured rating, and an SGL-1 Speculative Grade Liquidity Rating. The outlook is stable. Proceeds from the company's new senior unsecured notes issuance will be used to repay outstanding revolver borrowings and for general corporate purposes. The revolver borrowings relate to prior acquisitions made by Emergent. Ratings assigned: Corporate Family Rating, Ba2 Probability of Default Rating, Ba2-PD Senior unsecured notes, Ba3 (LGD5) Speculative Grade Liquidity Rating, SGL-1 Outlook actions: Outlook assigned stable RATINGS RATIONALE Emergent's Ba2 Corporate Family Rating reflects its niche position developing and manufacturing products that treat public health threats. Areas of focus include public health outbreaks such as the coronavirus pandemic, vaccines for military and civilian use, travel health, and the US opioid epidemic. Moody's anticipates steady ongoing growth in Emergent's anthrax and smallpox vaccines supplied to the US Strategic National Stockpile. A plethora of recent coronavirus vaccine manufacturing contracts signed with companies like Johnson & Johnson and AstraZeneca PLC, as well as the US government itself, will bolster Emergent's contract development and manufacturing organization business. With Emergent's niche focus comes modest scale compared to global pharmaceutical companies, with somewhat limited diversity at the product and customer level. Contracting with the US government subjects Emergent to compliance with numerous laws and regulations, and cash flow volatility associated with ordering patterns. There is also risk that changes in the government's strategic priorities or budgetary constraints reduce demand for Emergent's products. Further, while the coronavirus pandemic will significantly boost Emergent's CDMO business over the next several years, there is uncertainty around the longer-term sustainability of revenue in that business. Moody's anticipates that Emergent will sustain modest financial leverage, with debt/EBITDA in the range of 2.5x-3.5x. ESG considerations are material to Emergent's rating. Social risks include maintaining favorable customer relations with the US government, which is Emergent's largest customer. Demand from the US government for Emergent's key products is subject to prioritization of public health needs and budgetary considerations, which can change over time. As a key supplier to the US government's Strategic National Stockpile, Emergent is also subject to numerous laws and contractual requirements. Social risks also include responsible production, including timely supply and delivery to the US government, and compliance with manufacturing compliance standards. Moody's regards the coronavirus pandemic as a social risk under its ESG framework, given the substantial implications for public health and safety. Emergent faces substantial social opportunities related to the pandemic because of multiple contracts with coronavirus vaccine manufacturers and the US government to produce vaccines in its facilities. These contracts will produce substantial revenues for Emergent over the next several years, and boost the status of its CDMO business. Among governance considerations, Emergent's financial policies have included an appetite for debt-financed acquisitions, which Moody's expects will continue. However, the company's publicly articulated net debt/EBITDA target of 2.0x to 3.0x reflects a policy of generally moderate financial leverage, although this range could be exceeded for debt-funded acquisitions. The Ba3 rating on the senior unsecured notes reflects the presence of secured debt in Emergent's capital structure in the form of a $430 million term loan and a $600 million revolving credit facility. The revolver is expected to be undrawn following the senior notes issuance. The SGL-1 Speculative Grade Liquidity Rating reflects Moody's expectation that Emergent will maintain very good liquidity based on positive free cash flow, availability under the $600 million revolving credit agreement expiring in 2023, and good cushion under financial maintenance covenants in the term loan and revolver. These include net debt/EBITDA of below 3.75x stepping down to 3.5x starting in 4Q2020, and interest coverage (EBITDA less maintenance capex divided by interest cost and principal payments) of greater than 2.5x. The outlook is stable, reflecting Moody's expectations for steady growth in the product portfolio and successful execution of various COVID-19 related supply contracts. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to an upgrade include increased scale and diversity, successful fulfillment of COVID-19 vaccine commitments, and growth in the CDMO business beyond COVID-19 contracts. Quantitatively, debt/EBITDA sustained below 2.5x would support an upgrade. Conversely, factors that could lead to a downgrade include a termination of anthrax or smallpox vaccine contracts with the US government, setbacks in COVID-19 vaccine production, or manufacturing compliance deficiencies. Quantitatively, debt/EBITDA sustained above 3.5x could result in a downgrade. Headquartered in Gaithersburg, Maryland, Emergent BioSolutions Inc. is a life sciences company that provides pharmaceuticals, vaccines, medical devices and contract manufacturing services related to public health threats affecting civilian and military populations. Revenues for the 12 months ended June 30, 2020 totaled approximately $1.3 billion. The principal methodology used in these ratings was Pharmaceutical Industry published in June 2017. FITNESS INTERNATIONAL: Moody's Cuts CFR to Caa3, Outlook Still Neg. ------------------------------------------------------------------- Moody's Investors Service downgraded Fitness International, LLC's Corporate Family Rating to Caa3 from Caa1, Probability of Default Rating to Caa3-PD from Caa2-PD, and first lien bank credit facilities to Caa3 from B3. The outlook is negative. The downgrade reflects the recent surge in coronavirus cases in states on the West coast, South, Southwest and the resultant mandated re-closing of gyms in California and Arizona as well as the possibility of additional mandated gym closures in other states. California and Arizona-based clubs combined generate slightly over 20% of Fitness International's total revenue. Moody's views the possibility of intermittent mandated gym closures in the US to be high for the rest of 2020 and into 2021. This would result in weak earnings for a more prolonged period than anticipated back when the company was downgraded in April and continued depletion of cash and liquidity. Moody's now expects lease adjusted debt-to-EBITDA to rise to well above 8.0x by year end 2020 and leverage will remain high over the next year. Furthermore, the downgrade of the CFR to Caa3 reflects Moody's view that prolonged gym closures in critical geographic regions and the potential for continued membership declines due to the ongoing coronavirus crisis will further erode Fitness International's earnings base and liquidity. Rent previously deferred during gym closures is coming due over the next few months and will add to cash utilization. Because the revolver is fully drawn and free cash flow is negative, the company is dependent on its existing but declining cash balance for liquidity. Moody's views the company's capital structure with about $1.7 billion of total funded debt as well as the high financing and operating lease obligations as becoming increasingly unsustainable in the current environment. The Caa3 CFR reflects Moody's view that the possibility of a default under Moody's definition including a pre-emptive restructuring such as a distressed exchange is high over the next 12 to 18 months. Additionally, the instrument rating downgrades reflect Moody's expectation that recovery values for the first lien credit facilities will be weaker than previously anticipated in the event of a default in the current economic environment. Moody's took the following rating actions: Issuer: Fitness International, LLC Corporate Family Rating, downgraded to Caa3 from Caa1 Probability of Default Rating, downgraded to Caa3-PD from Caa2-PD Senior Secured First Lien Revolving Credit Facility, downgraded to Caa3 (LGD3) from B3 (LGD2) Senior Secured First Lien Term Loans (A and B), downgraded to Caa3 (LGD3) from B3 (LGD2) Outlook Actions: Issuer: Fitness International, LLC Outlook, remains Negative RATINGS RATIONALE Fitness International's Caa3 CFR broadly reflects its high leverage, with Moody's lease adjusted debt/EBITDA expected to rise to well above 8.0x by year end 2020. Leverage is expected to remain high over the next year due to significant earnings decline as a result of the ongoing coronavirus pandemic that is leading to gym closures, low utilization because of social distancing precautions, and lower discretionary consumer income. The rating is also constrained by the highly fragmented and competitive fitness club industry with high attrition rates, Fitness International's positioning in the industry's more pressured mid-tier price point, as well as exposure to cyclical shifts in discretionary consumer spending. Furthermore, the credit profile is constrained by Fitness International's weak liquidity. Although the company has taken aggressive actions to reduce expenses and preserve cash since mid-March including seeking forbearance and waivers from its lenders through the end of the August, the extent of the cash burn is driven by uncertain factors such as the length of club closures and the ability to rebuild membership once the clubs reopen. Liquidity is also constrained by the mandatory 5% amortization for its $950 million first lien term loan A, a fully drawn revolver and the high likelihood of a covenant violation. There is also the uncertainty whether the founders or minority shareholders would provide cash and liquidity support to the company. However, the rating is supported by a well-recognized brand name, the company's position as the largest non-franchisee fitness center by number of clubs, as well as the longer-term positive fundamentals for the fitness club industry such as its apparent under penetration and an increased awareness of the importance of fitness. 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. Its action reflects the impact on Fitness International, given its exposure to gym closures, mandated stay at home orders, increased social distancing measures and reductions in discretionary consumer spending, which have left the company vulnerable to shifts in market demand and sentiment in these unprecedented operating conditions. Technology developments are creating new competitors for traditional facilities-based fitness clubs including changes in consumer habits toward rapidly growing at-home, social-based services. Moody's believes fitness clubs provide a service that will continue to attract consumers, but that the coronavirus is accelerating the transition to new technology-based services during gym closures. This will make it more challenging to return to pre-coronavirus membership levels without enhancing service levels and reducing membership fees. The negative outlook reflects Fitness International's high leverage, as well as Moody's view that the company remains vulnerable to coronavirus disruptions and unfavorable shifts in discretionary consumer spending over the next year. In addition, the negative outlook reflects Moody's concern that the company's capital structure is becoming increasingly unsustainable and the possibility of a default including a pre-emptive restructuring such as a distressed exchange that Moody's view as high over the next 12 to 18 months. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded should operating performance, credit metrics and liquidity improve. The ratings could be downgraded if the operating performance or liquidity remains weak, the potential for distressed exchange or other default increases for any reason, or estimated recovery values weaken. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Fitness International, LLC is the largest non-franchised fitness club operator in the United States with about 734 clubs in 27 US states, the District of Columbia, and 2 Canadian provinces under the LA Fitness brand name. When considering the franchise operators, the company's chain size is second to the franchised Planet Fitness brand. Common equity in the company is wholly owned by founding members and the Seidler family. Revenue for the LTM period ended March 31, 2020 was about $2.1 billion. FORUM ENERGY: 96% of Existing 9% Convertible Notes Validly Tendered ------------------------------------------------------------------- Forum Energy Technologies, Inc., reports the expiration and results of its previously announced offer to exchange its existing notes for new 9.00% convertible secured notes due 2025. The Offer expired at 11:59 p.m., New York City time, on July 31, 2020. As of the expiration date, an aggregate principal amount of $315,489,000, or 96.14%, of the existing notes were validly tendered and not validly withdrawn. Accordingly, the minimum participation condition of 95% to the closing of the exchange offer has been satisfied. Forum's CEO and Chairman of the Board commented, "We are extremely pleased with the positive outcome of this transformative transaction. The conversion of our original notes into new notes extends the tenor of our long-term debt by four years and provides Forum a path to meaningfully deleverage its balance sheet through a mandatory conversion feature while maintaining the current cash coupon. This exchange was achieved in combination with 100% support of Forum's ABL lenders. We believe Forum has ample liquidity to weather the current downturn and the balance sheet flexibility to take advantage of strategic opportunities as the market recovers. I want to thank all our stakeholders for partnering together to achieve this successful result." "I am also very pleased with the cooperation and sacrifices Forum's employees have made to achieve significant cost structure reductions during this low oil price environment and to reposition our product offerings for success in a world of lower demand." Pursuant to the final prospectus, filed by the Company on July 31, 2020 with the Securities and Exchange Commission, the Company has accepted for exchange all such existing notes validly tendered and not validly withdrawn in the exchange offer as of the expiration date and expects to make payment of the aggregate early participation payment, together with accrued and unpaid interest for such existing notes, on Aug. 4, 2020. The amendment to the indenture governing the existing notes will be effective on this date. The terms and conditions of the exchange offer are described in the prospectus. BofA Securities, Inc., Wells Fargo Securities, LLC, Citigroup Global Markets Inc., J.P. Morgan Securities LLC, HSBC Securities (USA) Inc., Deutsche Bank Securities Inc. and Raymond James & Associates, Inc. have acted as dealer managers in connection with the exchange offer. Questions regarding the exchange offer may be directed to BofA Securities at (980) 388-3646 or debt_advisory@bofa.com. Copies of the prospectus may be obtained from the information and exchange agent for the exchange offer, D.F. King & Co., Inc., at (866) 864-7961 (toll-free) or (212) 269-5550 (for banks and brokers), by email to forum@dfking.com or by accessing the website www.dfking.com/forum. A registration statement relating to these securities has been filed with, and declared effective by, the Securities and Exchange Commission. About Forum Energy Forum Energy Technologies -- http://www.f-e-t.com-- is a global oilfield products company, serving the drilling, downhole, subsea, completions and production sectors of the oil and natural gas industry. The Company's products include highly engineered capital equipment as well as products that are consumed in the drilling, well construction, production and transportation of oil and natural gas. Forum is headquartered in Houston, TX with manufacturing and distribution facilities strategically located around the globe. Forum Energy reported a net loss of $567.06 million for the year ended Dec. 31, 2019 compared to a net loss of $374.08 million for the year ended Dec. 31, 2018. * * * As reported by the TCR on June 26, 2020, S&P Global Ratings raised its issuer credit rating on Houston-based oilfield products and services provider Forum Energy Technologies Inc. to 'CCC-' from 'SD' (selective default) after the company completed its tender offer for a portion of its 6.25% senior unsecured notes due 2021. In May 2020, Moody's Investors Service downgraded Forum Energy Technologies, Inc.'s Corporate Family Rating to Ca from Caa1. "The downgrade of Forum's ratings reflect increased restructuring risks for the company's remaining debt as maturities approach," said Jonathan Teitel, a Moody's analyst. FRONTIER COMMUNICATIONS: Wilmington Savings Objects to Disclosures ------------------------------------------------------------------ Wilmington Savings Fund Society, FSB (the "Second Lien Notes Trustee"), submitted an objection to the Motion filed by Frontier Communications Corporation, et al. for entry of an Order approving (I) the Adequacy of the Disclosure Statement, (II) Solicitation and Notice Procedures, (III) Forms of Ballots and Notices in Connection Therewith, and (IV) Certain Dates with Respect Thereto. The Second Lien Notes Trustee asserts that the Plan and Disclosure Statement fail to acknowledge that the second lien notes are impaired and entitled to vote. The Second Lien Notes Trustee points out that the Disclosure Statement is inadequate because it fails to advise second lien noteholders of their exact treatment under the Plan. The Second Lien Notes Trustee complains that the Disclosure Statement fails to mention or address the risks associated with the second lien notes indenture's "change of control" provisions. According to the Second Lien Notes Trustee, the Disclosure Statement fails to provide information regarding a potential cash-out or the risks and issues associated with a cash-out of the second lien notes. The Second Lien Notes Trustee asserts that the Disclosure Statement fails to mention or address the various defaults under the second lien notes indenture and the risks and issues associated with repayment of the second lien notes, including the second lien notes indenture’s cross-default provisions. The Second Lien Notes Trustee points out that the Disclosure Statement is deficient because it fails to address the impact of Section 506(b) on the payment of the second lien notes. The Second Lien Notes Trustee complains that the Disclosure Statement is inconsistent with the plan in that it fails to highlight that the plan seeks to cancel the second lien notes and the second lien notes indenture. Counsel for Wilmington Savings Fund Society, FSB, as Indenture Trustee and Collateral Agent for the 8.500% Second Lien Secured Notes due 2026: Joseph L. Schwartz Curtis M. Plaza Tara J. Schellhorn Tod S. Chasin RIKER, DANZIG, SCHERER, HYLAND & PERRETTI LLP Headquarters Plaza, One Speedwell Avenue Morristown, New Jersey 07962-1981 Tel: (973) 538-0800 - and - 500 Fifth Avenue, 49th Floor New York, New York 10110 Tel: (212) 302-6574 About Frontier Communications Frontier Communications Corporation (NASDAQ: FTR) offers a variety of services to residential and business customers over its fiber-optic and copper networks in 29 states, including video, high-speed internet, advanced voice, and Frontier Secure digital protection solutions. Frontier Communications Corporation and 103 related entities sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-22476) on April 14, 2020. Judge Robert D. Drain oversees the cases. Debtors tapped Kirkland & Ellis LLP as legal counsel; Evercore as financial advisor; and FTI Consulting, Inc., as restructuring advisor. Prime Clerk is the claims agent, maintaining the page http://www.frontierrestructuring.com/and https://cases.primeclerk.com/ftr The U.S. Trustee for Region 2 appointed a committee to represent unsecured creditors in Debtors' Chapter 11 cases. The committee tapped Kramer Levin Naftalis & Frankel LLP as its counsel; Alvarez & Marsal North America, LLC as financial advisor; and UBS Securities LLC as investment banker. HUDSON TECHNOLOGIES: Board Approves Termination of CRO ------------------------------------------------------ The Board of Directors of Hudson Technologies, Inc. authorized the termination, effective July 31, 2020, of Ryan A. Maupin, the Company's chief restructuring officer, due to the achievement of certain performance targets. Mr. Maupin had been appointed as chief restructuring officer in January 2020 in accordance with the terms of the Fourth Amendment to the Term Loan Credit and Security Agreement dated as of Oct. 10, 2017, as amended, by and among Hudson Technologies Company, Hudson Holdings, Inc., Aspen Refrigerants, Inc., the Company, the other credit parties thereto, the financial institutions party thereto as lenders, and U.S. Bank National Association, as collateral and administrative agent for the lenders. Pursuant to Section 6.17 of the Credit Agreement, the Credit Parties could elect to terminate the chief restructuring officer upon notice to the lenders if, following the chief restructuring officer's retention, (i) the Borrowers' LTM Adjusted EBITDA (as defined in the Credit Agreement) exceeds the greater of (x) 105% of the minimum LTM Adjusted EBITDA under the Credit Agreement and (y) $9.55 million (the greater of (x) or (y) being the "Required EBITDA Threshold") for two consecutive quarterly reporting periods and (ii) no Default or Event of Default (each as defined in the Credit Agreement) has occurred and is continuing as of such date. The Company has reasonably determined that the Required EBITDA Threshold and other conditions pursuant to the Credit Agreement have been met and that the services of the chief restructuring officer were no longer needed. About Hudson Technologies Headquartered in Pearl River, New York, Hudson Technologies, Inc. -- http://www.hudsontech.com-- is a refrigerant services company providing innovative solutions to recurring problems within the refrigeration industry. The Company's products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems, and include refrigerant and industrial gas sales, refrigerant management services consisting primarily of reclamation of refrigerants and RefrigerantSide Services performed at a customer's site, consisting of system decontamination to remove moisture, oils and other contaminants. Hudson Technologies reported a net loss of $25.94 million for the year ended Dec. 31, 2019, compared to a net loss of $55.66 million for the year ended Dec. 31, 2018. As of March 31, 2020, the Company had $187.73 million in total assets, $145.38 million in total liabilities, and $42.35 million in total stockholders' equity. Hudson Technologies received on April 17, 2020, a letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC indicating that, due to recent market turmoil, Nasdaq has filed a rule change tolling the compliance period for bid price requirements through June 30, 2020. As a result, the requirement of the Company to regain compliance with a minimum bid price of at least $1.00 per share, as set forth in Nasdaq Listing Rule 5550(a)(2), has been extended from July 27, 2020 to Oct. 12, 2020. HUDSON TECHNOLOGIES: Posts $2.4M Net Income in Second Quarter ------------------------------------------------------------- Hudson Technologies, Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting net income of $2.38 million on $47.68 million of revenues for the three months ended June 30, 2020, compared to a net loss of $13.80 million on $56.01 million of revenues for the three months ended June 30, 2019. The decrease in revenue is primarily due to a decline in volume, partially offset by an increase in selling price, of certain refrigerants sold during the second quarter of 2020, compared to the second quarter of 2019. Gross margin in the second quarter of 2020 was 26.6%, compared to negative gross margin in the second quarter of 2019. The Company reported operating income of $5.2 million for the second quarter of 2020 compared to an operating loss of $10.0 million in the second quarter of 2019. During the second quarter of 2019 the Company recorded a lower of cost or net realizable value adjustment to its inventory of $9.2 million, mainly due to declines in selling prices of certain refrigerants at that time. For the six months ended June 30, 2020, the Company reported a net loss of $499,000 on $84.03 million of revenues compared to a net loss of $17.84 million on $90.67 million of revenues for the three months ended June 30, 2019. As of June 30, 2020, the Company had $187.23 million in total assets, $142.29 million in total libailities, and $44.94 million in ttoal stockholders' equity. Brian F. Coleman, president and chief executive officer of Hudson Technologies commented, "We were pleased to deliver solid second quarter results, particularly as we continue to navigate the challenging landscape associated with the COVID-19 virus and the associated impact to our economy. During the quarter, the closures to public venues, such as office buildings, recreation centers, schools and universities across the U.S. impacted end markets and demand for refrigerants. While pricing remained consistent in the quarter, volume declines adversely impacted our overall revenues. Nonetheless, we delivered improved gross margin for the quarter, achieved solid operating income and returned to profitability. "There are still many uncertainties associated with this pandemic and we remain focused on the elements of our business that we can control: protecting the health and safety of our employees and keeping our products in supply to best serve our customers across all channels. We've been in this business for more than thirty years, and our ability to adapt to changing economic and industry landscapes while executing our operational strategy is a strength we continue to rely upon. Despite the challenging market environment, Hudson generated over $6 million of operating cash flow during the second quarter of 2020. The Company's financial position and liquidity remain strong, with total liquidity at June 30, 2020 of approximately $39 million, which includes cash and revolver availability. Finally, as announced in an 8-K this past Monday, we've met certain performance targets set forth in our Credit Agreement, and as a result of this achievement, we have terminated the services of our Chief Restructuring Officer. "As you know, in late June, our Company suffered the unexpected loss of our founder Kevin J. Zugibe, P.E. He was an industry pioneer who brought remarkable passion, expertise and energy to Hudson, and he is greatly missed. In his years building the Company, Kevin recognized the importance of establishing a strong management team to drive and support Hudson's growth. All of our employees are committed to continuing to grow and execute on Kevin's legacy, and as one of Kevin's longstanding partners for over 20 years, I can assure you that we are focused on our Company's success as we move through the coming months and years," Mr. Coleman concluded. A full-text copy of the Form 10-Q is available for free at: https://is.gd/uFO7CM About Hudson Technologies Headquartered in Pearl River, New York, Hudson Technologies, Inc. -- http://www.hudsontech.com/-- is a refrigerant services company providing innovative solutions to recurring problems within the refrigeration industry. The Company's products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems, and include refrigerant and industrial gas sales, refrigerant management services consisting primarily of reclamation of refrigerants and RefrigerantSide Services performed at a customer's site, consisting of system decontamination to remove moisture, oils and other contaminants. Hudson Technologies reported a net loss of $25.94 million for the year ended Dec. 31, 2019, compared to a net loss of $55.66 million for the year ended Dec. 31, 2018. As of March 31, 2020, the Company had $187.73 million in total assets, $145.38 million in total liabilities, and $42.35 million in total stockholders' equity. Hudson Technologies received on April 17, 2020, a letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC indicating that, due to recent market turmoil, Nasdaq has filed a rule change tolling the compliance period for bid price requirements through June 30, 2020. As a result, the requirement of the Company to regain compliance with a minimum bid price of at least $1.00 per share, as set forth in Nasdaq Listing Rule 5550(a)(2), has been extended from July 27, 2020 to Oct. 12, 2020. JACOBSON HOTELS: Voluntary Chapter 11 Case Summary -------------------------------------------------- Debtor: Jacobson Hotels, Inc. 18484 Interstate 45 S Shenandoah, TX 77384-4118 Business Description: Jacobson Hotels, Inc., is a privately held company in the traveler accommodation industry. Chapter 11 Petition Date: August 4, 2020 Court: United States Bankruptcy Court Southern District of Texas Case No.: 20-33957 Judge: Hon. Jeffrey P. Norman Debtor's Counsel: Patrick D. Devine, Esq. DEVINE LAW FIRM, PC 620 W. Main St. Suite C Tomball, TX 77375 Tel: (281) 255-0244 Email: pdevine@pdevinelaw.com Total Assets as of December 31, 2019: $5,757,149 Total Liabilities as of December 31, 2019: $3,850,120 The petition was signed by Grace L. Jacobson, director. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/C4gxEH JASON INDUSTRIES: Unsecured Claims Unimpaired in Plan ----------------------------------------------------- Jason Industries, Inc. et al., submitted a Plan and a Disclosure Statement. The Plan implements a prepackaged restructuring agreed to by and among the Debtors and the Debtors' major stakeholders, including Holders of approximately 87% in amount of First Lien Secured Credit Agreement Claims and First Lien Credit Agreement Deficiency Claims, which will result in a significant deleveraging of the Debtors’ capital structure. The anticipated benefits of the Plan include, without limitation, the following: (a) a comprehensive restructuring of the Debtors' capital structure through a sale under the Plan of 100% of the assets of Jason Industries, Inc. (including the equity interests of Debtors held by Jason Industries, Inc. and their subsidiaries) to one of the newly formed holding companies designated by the First Lien Ad Hoc Group (each such newly formed holding company, including any subsidiaries or parent entities formed for the purpose of consummating the Sale Transaction, pursuant to the Restructuring Steps Memorandum, as applicable, "Jason NewCo"). The transfer under the Plan shall be structured as a merger and will likely be treated as a taxable sale of 100% of the assets of the Debtors for U.S. federal income tax purposes, with the purchase funded by a credit bid by Holders of First Lien Secured Credit Agreement Claims; (b) conversion of approximately $278.6 million of First Lien Credit Agreement Claims, plus accrued and unpaid interest as of the Petition Date, to a combination of (i) a new senior secured term loan facility in an aggregate principal amount of $75 million (the "New First Lien Term Loan Facility"), (ii) a takeback junior convertible secured term loan facility in an aggregate principal amount of $50 million (the "New Junior Lien Convertible Term Loan Facility"), (iii) 100% of the New Jason Equity, subject to dilution by the Warrants, the Management Incentive Plan, and the New Junior Convertible Term Loans; provided that 10% of such New Jason Equity, subject to dilution by the Warrants, the Management Incentive Plan, and New Junior Convertible Term Loans shall be distributed on account of Second Lien Credit Agreement Claims as provided for in the Plan; (iv) if applicable, the First Lien Put Option; and (v) the Warrants, which Warrants shall be distributed on account of Second Lien Credit Agreement Claims, as provided in the Plan. (c) conversion of approximately $94.6 million of Second Lien Credit Agreement Claims into, as a carve-out from the collateral securing the First Lien Secured Credit Agreement Claims, (i) if Class 5 timely accepts the Plan, its Pro Rata share of and interest in (x) 10% of the New Jason Equity, subject to dilution by the Warrants, the Management Incentive Plan, and the New Junior Convertible Term Loans, and (y) Warrants; and (ii) if Class 5 rejects the Plan, no distribution; (d) reinstatement, payment in full in Cash, or such other treatment rendering each Allowed General Unsecured Claim Unimpaired; (e) prompt emergence from chapter 11; (f) a new, third-party, asset-based exit financing facility (the "New Revolving Exit Facility") that (i) provides availability as of the Effective Date of at least $20 million for revolving borrowings after permitting for any amounts on account of outstanding letters of credit; and (ii) has aggregate total commitments in an amount not less than $30 million to be agreed on terms acceptable to the Consenting First Lien Credit Agreement Lenders. (g) maintenance of critical business relationships with employees, customers, and vendors; and (h) consensual use of the Consenting First Lien Credit Agreement Lenders' cash collateral to fund these Chapter 11 Cases, subject to the terms and conditions of the Restructuring Support Agreement and the Cash Collateral Orders. The Plan provides for a comprehensive restructuring of the Debtors' prepetition obligations, preserves the going-concern value of the Debtors' businesses, maximizes creditor recoveries, and preserves the jobs of the Debtors’ approximately 700 employees. To evidence their support of the Debtors’ restructuring, the Debtors and their key stakeholders executed the Restructuring Support Agreement, a copy of which is attached hereto as Exhibit B. As described in further detail below, under the terms of the Plan, among other things: (a) each Holder of a First Lien Credit Agreement Claim shall receive its Pro Rata share of and interest in: (i) the New First Lien Term Loan Facility; (ii) New Junior Lien Convertible Term Loan Facility; (iii) 100% of the New Jason Equity, subject to dilution by the Warrants, the Management Incentive Plan, and the New Junior Convertible Term Loans; provided that 10% of such New Jason Equity, subject to dilution by the Warrants, the Management Incentive Plan, and New Junior Convertible Term Loans shall be distributed on account of Second Lien Credit Agreement Claims as provided for in the Plan; (iv) if applicable, the First Lien Put Option; and (v) the Warrants, which Warrants shall be distributed on account of Second Lien Credit Agreement Claims, as provided for in the Plan; (b) each Holder of a First Lien Credit Agreement Claim shall have the option to offer the entirety of its Pro Rata distribution of both the (i) New Jason Equity and (ii) New Junior Lien Convertible Term Loan Facility to one or more of the members of the First Lien Ad Hoc Group that has committed to accept such distribution (a "First Lien Put Backstop Party") in exchange for an amount of Cash equal to 101% of an exercising Holder’s Pro Rata distribution of the New Junior Lien Convertible Term Loan Facility (the "First Lien Put Price" ), subject to the First Lien Put Backstop Commitment (the "First Lien Put Option"); (c) each Holder of an Allowed Second Lien Credit Agreement Claim shall receive as a carve-out from the collateral securing the First Lien Secured Credit Agreement Claims: (i) if Class 5 timely accepts the Plan, its Pro Rata share of and interest in (x) 10% of the New Jason Equity, subject to dilution by the Warrants, the Management Incentive Plan, and the New Junior Convertible Term Loans, and (y) Warrants; and (ii) if Class 5 rejects the Plan, no distribution; and (d) each Holder of an Allowed General Unsecured Claim will receive, as a carve-out from the collateral securing the First Lien Secured Credit Agreement Claims and at the election of the Debtors or the Reorganized Debtors, as applicable, either: (a) Reinstatement of such Allowed General Unsecured Claim pursuant to Section 1124 of the Bankruptcy Code; (b) payment in full in Cash on the later of (i) the Effective Date or as soon as reasonably practicable thereafter, or (ii) the date such payment is due in the ordinary course of business in accordance with the terms and conditions of the particular transaction giving rise to such Allowed General Unsecured Claim; or (c) such other treatment rendering such Allowed General Unsecured Claim Unimpaired. A full-text copy of the Disclosure Statement dated June 24, 2020, is available at https://tinyurl.com/y9cno3dc from PacerMonitor.com at no charge. Proposed Counsel to the Debtors: Jonathan S. Henes, P.C. Emily E. Geier KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 About Jason Industries Jason Industries, Inc., headquartered in Milwaukee, Wisconsin, is a diversified manufacturing company serving the finishing, seating, acoustics and components end markets. Jason Industries, Inc., and 7 affiliates sought Chapter 11 protection (S.D.N.Y. Lead Case No. 20-22766) after reaching a deal with lenders on terms of a plan that will cut debt by $250 million. As of June 24, 2020, the Company reported total assets of $204,886,939 and total debt of $428,374,343. The Hon. Robert D. Drain is the case judge. Moelis & Company LLC, is acting as financial advisor, Kirkland & Ellis LLP is acting as legal counsel, and AlixPartners, LLP, is acting as restructuring advisor to the Company in connection with the Restructuring. Houlihan Lokey Capital, Inc., is acting as financial and restructuring advisor and Weil, Gotshal & Manges LLP is acting as legal counsel to the Consenting Creditors. Epiq Corporate Restructuring, LLC, is the claims agent. JONESBORO TRACTOR: Kubota Contracts May Be Assumed, Court Rules --------------------------------------------------------------- Bankruptcy Judge Phyllis M. Jones granted Jonesboro Tractor Sales, Inc.'s Motion for Determination that Contracts/Agreements Between Debtor and Kubota Tractor Corporation are assumable. Kubota's Motion for Relief from Stay is denied. The Debtor and Kubota are parties to a dealership agreement consisting of a Dealer Sales and Service Agreement, and a Dealer Terms and Discount Schedule. Kubota, a secured creditor of the Debtor, filed a proof of claim in the amount of $6,574,466.35. The claim is secured by the "Debtor's inventory of [wholegoods], parts and proceeds." The parties dispute whether the Dealership Agreement is an assumable executory contract or whether it is "a contract to make a loan, or extend other debt financing or financial accommodations, to or for the benefit of the [D]ebtor" that is not assumable under the Bankruptcy Code. 11 U.S.C. section 365(c)(2). The Debtor argues that the analysis begins with the Dealership Agreement itself, an agreement drafted by Kubota. The Debtor argues the primary focus of the Dealership Agreement is for Kubota to sell its products through the Debtor, not the extension of credit. It argues the Dealership Agreement provides three different ways for the Debtor to purchase Kubota products and only one involves the extension of credit. The Debtor further argues that Kubota is not being forced to make a loan, extend credit, or provide financial accommodations to the Debtor, and although the Debtor took advantage of the open account financing option prepetition, since the bankruptcy filing it has only been allowed to use the cash and C.O.D. options. It argues Kubota's postpetition removal of the financing option proves that the financing option is incidental to the Dealership Agreement. Because the extension of credit is only incidental to the parties' relationship, the Debtor argues the Dealership Agreement cannot be classified as a financial accommodation. As to the request for relief from stay, the Debtor argues that it is not in default under the Dealership Agreement, except for the act of filing bankruptcy, and the ipso facto clause is not enforceable. The Debtor also argues that Kubota sales represent over 80% of the Debtor's business and the Dealership Agreement is essential to the Debtor's business. Kubota acknowledges that it can insist on methods of payment other than the open account financing option, but it argues the Dealership Agreement nevertheless constitutes a financial accommodation because financing has always been a central part of the parties' relationship. Kubota argues that prior to the bankruptcy filing, the Debtor always used the financing option to acquire Kubota products and points to the Debtor's owner Ms. Wilma Grissom's testimony that the financing arrangement is important to the Debtor's business. Kubota further argues that without the open account financing option the Debtor cannot maintain the inventory levels required by the Dealership Agreement. As to its request for relief from stay, Kubota primarily argues that if the Dealership Agreement is found to be a financial accommodation, the ipso facto termination provision is enforceable under Section 365(e)(2)(B). It argues alternatively, even if the Dealership Agreement is found to be assumable, the evidence proves the Debtor cannot maintain required inventory levels and, without other credit arrangements to purchase inventory, cause exists for relief from stay to be granted. It further argues if the Debtor cannot maintain the inventory levels required by the contract, then the contract has no value to the estate. According to Judge Jones, because Kubota is not required under the agreement to extend financing to the Debtor, the Dealership Agreement is not a contract to make a loan, or extend debt financing or financial accommodations for the benefit of the Debtor within the meaning of Section 365(c)(2) of the Bankruptcy Code. The Debtor's motion is, therefore, granted. Kubota's motion for relief from stay is denied. According to Judge Jones, relief from stay is not warranted at this stage of the proceedings. The Debtor is not in default of the Dealership Agreement, other than the act of filing bankruptcy, and because the agreement is not one to make a loan or extend debt financing or financial accommodations, the ipso facto termination clause is unenforceable. In addition, the Debtor continues to sell Kubota products, has maintained its parts inventory on a cash basis postpetition, and may be able to obtain third party financing for its wholegoods inventory postpetition if Kubota remains unwilling to finance the Debtor's purchase of Kubota products for resale. The Debtor has an interest in the Dealership Agreement and the Dealership Agreement is necessary for the Debtor's effective reorganization. A copy of the Court's Memorandum Opinion and Order is available at https://bit.ly/3glXfFe from Leagle.com. The bankruptcy case is in re: JONESBORO TRACTOR SALES, INC., Chapter 11, Debtor-in-Possession, Case No. 3:20-bk-11561J (Bankr. E.D. Ark.). K & L TRAILER LEASING: Trustee Taps Bradley Avant as Legal Counsel ------------------------------------------------------------------ Gary Murphey, the Chapter 11 trustee for K & L Trailer Leasing, Inc., seeks approval from the U.S. Bankruptcy Court for the District of Tennessee to hire Bradley Arant Boult Cummings, LLP as his legal counsel. The firm will provide these services in connection with Debtor's Chapter 11 case: (a) prepare pleadings and applications for filing and conduct examinations incidental to the administration of the case or to any related proceedings; (b) advise Mr. Murphey of his rights, duties and obligations as a trustee operating under Chapter 11 of the Bankruptcy Code; (c) assist the trustee in the formulation of Debtor's bankruptcy plan and disclosure statement and in seeking confirmation of the plan; and (d) take other necessary actions to preserve Debtor's estate and administer its bankruptcy case. The trustee proposes to compensate Bradley Arant at reduced rates for the services of its attorneys. The current rate for the services of William Norton, III, Esq., and Austin McMullen, Esq., the Nashville bankruptcy partners who will be the trustee's main contact, has been reduced to $450 per hour. The current rate for the services of associates who will assist in representing the trustee is $345 per hour. Mr. Norton disclosed in a court filing that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Bradley Arant can be reached through: William L. Norton, III, Esq. Austin L. McMullen, Esq. Bradley Arant Boult Cummings 1600 Division St., Suite 700 Nashville, TN 37203 Tel: (615) 252-2397 Fax: (615) 252-6397 Email: bnorton@bradley.com amcmullen@bradley.com About K & L Trailer Leasing K&L Trailer Leasing, Inc., a company based in Knoxville, Tenn., filed a Chapter 11 petition (Bankr. E.D. Tenn. Case No. 20-31620) on June 29, 2020. At the time of the filing, Debtor was estimated to have $10 million to $50 million in both assets and liabilities. Judge Suzanne H. Bauknight oversees the case. Gentry Tipton & McLemore, P.C. is Debtor's bankruptcy counsel. Gary M. Murphey was appointed as Debtor's Chapter 11 trustee. He is represented by Bradley Arant Boult Cummings. K & L TRAILER LEASING: Trustee Taps Resurgence as Financial Advisor ------------------------------------------------------------------- Gary Murphey, the Chapter 11 trustee for K & L Trailer Leasing, Inc., seeks approval from the U.S. Bankruptcy Court for the District of Tennessee to hire Resurgence Financial Services, LLC as his financial advisor. The firm will assist the trustee in accounting matters in connection with Debtor's Chapter 11 case. Resurgence Financial will be compensated at the rate of $350 per hour and will receive reimbursement for out-of-pocket expenses. Mr. Murphey, a member of Resurgence Financial, disclosed in court filings that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Resurgence Financial can be reached through: Gary M. Murphey Resurgence Financial Services, LLC 3330 Cumberland Blvd., Suite 500 Atlanta, GA 30339 Cell: (404) 886-9104 Office: (770) 933-6855 Email: Murphey@RFSLimited.com About K & L Trailer Leasing K&L Trailer Leasing, Inc., a company based in Knoxville, Tenn., filed a Chapter 11 petition (Bankr. E.D. Tenn. Case No. 20-31620) on June 29, 2020. At the time of the filing, Debtor was estimated to have $10 million to $50 million in both assets and liabilities. Judge Suzanne H. Bauknight oversees the case. Gentry Tipton & McLemore, P.C. is Debtor's bankruptcy counsel. Gary M. Murphey was appointed as Debtor's Chapter 11 trustee. He is represented by Bradley Arant Boult Cummings. K & L TRAILER SALES: Trustee Taps Bradley Arant as Legal Counsel ---------------------------------------------------------------- Gary Murphey, the Chapter 11 trustee for K & L Trailer Sales and Leasing, Inc., seeks approval from the U.S. Bankruptcy Court for the District of Tennessee to hire Bradley Arant Boult Cummings, LLP as his legal counsel. The firm will provide these services in connection with Debtor's Chapter 11 case: (a) prepare pleadings and applications for filing and conduct examinations incidental to the administration of the case or to any related proceedings; (b) advise Mr. Murphey of his rights, duties and obligations as a trustee operating under Chapter 11 of the Bankruptcy Code; (c) assist the trustee in the formulation of Debtor's bankruptcy plan and disclosure statement and in seeking confirmation of the plan; and (d) take other necessary actions to preserve Debtor's estate and administer its bankruptcy case. The trustee proposes to compensate Bradley Arant at reduced rates for the services of its attorneys. The current rate for the services of William Norton, III, Esq., and Austin McMullen, Esq., the Nashville bankruptcy partners who will be the trustee's main contact, has been reduced to $450 per hour. The current rate for the services of associates who will assist in representing the trustee is $345 per hour. Mr. Norton disclosed in a court filing that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Bradley Arant can be reached through: William L. Norton, III, Esq. Austin L. McMullen, Esq. Bradley Arant Boult Cummings 1600 Division St., Suite 700 Nashville, TN 37203 Tel: (615) 252-2397 Fax: (615) 252-6397 Email: bnorton@bradley.com amcmullen@bradley.com About K & L Trailer Sales and Leasing K & L Trailer Sales and Leasing is a family-owned business specializing in the sale, service and leasing of trailers. It carries Trailstar, Pitts Trailers, Manac, Reitnouer, Transcraft, Eager Beaver and ITI trailers. K & L Trailer Sales and Leasing sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tenn. Case No. 20-31619) on June 29, 2020. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $10 million and $50 million. Judge Suzanne H. Bauknight oversees the case. Gentry, Tipton and Mclemore, PC is Debtor's legal counsel. Gary M. Murphey was appointed as Debtor's Chapter 11 trustee. He is represented by Bradley Arant Boult Cummings. K & L TRAILER SALES: Trustee Taps Resurgence as Financial Advisor ----------------------------------------------------------------- Gary Murphey, the Chapter 11 trustee for K & L Trailer Sales and Leasing, Inc., seeks approval from the U.S. Bankruptcy Court for the District of Tennessee to hire Resurgence Financial Services, LLC as his financial advisor. The firm will assist the trustee in accounting matters in connection with Debtor's Chapter 11 case. Resurgence Financial will be compensated at the rate of $350 per hour and will receive reimbursement for out-of-pocket expenses. Mr. Murphey, a member of Resurgence Financial, disclosed in court filings that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. Resurgence Financial can be reached through: Gary M. Murphey Resurgence Financial Services, LLC 3330 Cumberland Blvd., Suite 500 Atlanta, GA 30339 Cell: (404) 886-9104 Office: (770) 933-6855 Email: Murphey@RFSLimited.com About K & L Trailer Sales and Leasing K & L Trailer Sales and Leasing is a family-owned business specializing in the sale, service and leasing of trailers. It carries Trailstar, Pitts Trailers, Manac, Reitnouer, Transcraft, Eager Beaver and ITI trailers. K & L Trailer Sales and Leasing sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tenn. Case No. 20-31619) on June 29, 2020. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $10 million and $50 million. Judge Suzanne H. Bauknight oversees the case. Gentry, Tipton and Mclemore, PC is Debtor's legal counsel. Gary M. Murphey was appointed as Debtor's Chapter 11 trustee. He is represented by Bradley Arant Boult Cummings. KIMBLE DEVELOPMENT: Unsecured Claims Unimpaired in Plan ------------------------------------------------------- Kimble Development of Jackson, L.L.C., filed a Plan of Liquidation and a Disclosure Statement. Under the Plan, the Debtor intends to distribute the proceeds from the sale of its shopping center in Jackson, MS ("Metro Crossing") to holders of Allowed Claims and Interests. Class 2 General Unsecured Claims are unimpaired. The Debtor estimates the aggregate amount of Allowed General Unsecured Claims is no more than $25,000. Each holder of an Allowed General Unsecured Claim will receive cash in an amount equal to such Claim on the Effective Date, with any default that occurred on or before the Petition Date being cured. Class 3 intercompany claims totaling $105,111 are impaired. Of this aggregate amount, $79,169 is subject to set off. The balance owed on all Intercompany Claims after setoff ($25,942) will be paid in full in cash after the payments of Class 1 and Class 2 Claims. The Debtor has sold (or will sell) the shopping center. The cash proceeds generated from this sale are sufficient to pay all Allowed Claims in full in cash on or before the Effective Date. A full-text copy of the Disclosure Statement dated June 22, 2020, is available at https://tinyurl.com/y83wm4gb from PacerMonitor.com at no charge. Attorneys for Kimble Development of Jackson, L.L.C.: Ryan J. Richmond STERNBERG, NACCARI & WHITE, LLC 17732 Highland Road, Suite G-228 Baton Rouge, LA 70810 Tel. (225) 412-3667 Fax (225) 286-3046 ryan@snw.law About Kimble Development of Jackson Kimble Development of Jackson, L.L.C., is primarily engaged in renting and leasing real estate properties. Kimble Development of Jackson, based in Baton Rouge, LA, filed a Chapter 11 petition (Bankr. M.D. La. Case No. 20-10008) on Jan. 8, 2020. In the petition signed by Michael D. Kimble, manager, the Debtor was estimated to have $1 million to $10 million in both assets and liabilities. Ryan J. Richmond, Esq., at Richmond Law Firm, LLC, serves as bankruptcy counsel to the Debtor. LAPEER INDUSTRIES: Voluntary Chapter 11 Case Summary ---------------------------------------------------- Debtor: Lapeer Industries, Inc. 3140 John Conley Drive Lapeer, MI 48446 Business Description: Lapeer Industries, Inc. is a design, machining, and fabrication company serving the automotive and defense industries. The Company provides fabrication, automated welding, machining, painting, assembly, and kitting services. Chapter 11 Petition Date: August 5, 2020 Court: United States Bankruptcy Court Eastern District of Michigan Case No.: 20-31375 Judge: Hon. Joel D. Applebaum Debtor's Counsel: Zachary R. Tucker, Esq. WINEGARDEN, HALEY, LINDHOLM, TUCKER & HIMELHOCH P.L.C. G9460 S. Saginaw St. Suite A Grand Blanc, MI 48439 Tel: 810-579-3600 E-mail: ztucker@winegarden-law.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $10 million to $50 million The petition was signed by Daniel Schreiber, president. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/icVo5C LAPLACE VETERINARY: Sept. 9 Hearing on Disclosures and Plan ----------------------------------------------------------- Judge Meredith S. Grabill has ordered that the confirmation hearing of LaPlace Veterinary Clinic, LLC that was previously scheduled before the undersigned on July 21, 2020 is continued. The hearing to consider approval and confirmation of the Debtor's Amended Combined Subchapter V Disclosure Statement and Chapter 11 Plan of Reorganization which was filed on June 10, 2020, will be held before the Honorable Meredith S. Grabill on Wednesday, Sept. 9, 2020 at 9:00 A.M. Teleconference No. 1(888) 684-8852, Access Code:9318283. Sept. 2, 2020, is fixed as the last day for filing written objections to said Amended Combined Subchapter V Disclosure Statement and Plan of Reorganization and for serving same. Sept. 2, 2020, is fixed as the last day for filing acceptances or rejections to the amended combined subchapter V disclosure statement and plan of reorganization. Counsel for Debtor is to submit the ballots in hard copy to the Clerk of Bankruptcy Court three days prior to the confirmation hearing for verification of the Tabulation. The Zoom Meeting Room link is https://www.zoomgov.com/my/judgegrabill. Counsel for parties-in-interest shall provide notice to anna_mangham@laeb.uscourts.gov via e-mail of all people who will be participating via Zoom no later than September 2, 2020 at 5:00 P.M. CST. About LaPlace Veterinary Clinic LaPlace Veterinary Clinic, LLC -- https://www.laplacevet.com -- is a full service animal hospital offering emergency treatments as well as routine medical, surgical, and dental care. The veterinary clinic and animal hospital is run by Dr. Kia Gray Martin, who is a licensed, experienced Laplace veterinarian. LaPlace Veterinary Clinic, LLC, filed its voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. E.D. La. Case No. 20-10396) on Feb. 20, 2020. In the petition was signed by Kia Martin, manager, the Debtor was estimated to have $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. LIBBEY GLASS: Unsecured Creditors to Get Share of Cash Pool ----------------------------------------------------------- Libbey Glass Inc., et al., submitted a Plan and a Disclosure Statement. As of the Petition Date, the Company’s global manufacturing, warehousing and distribution facilities have an aggregate floor space of 7.1 million square feet. As of the Petition Date, the Company owns approximately 65 percent and leases approximately 35 percent of this floor space. In addition, the Company's headquarters in Toledo, Ohio, office space for members of the marketing, digital and e-commerce team in Columbus, Ohio, some warehouses in various locations, sales offices in various locations, showrooms in Chicago, Illinois, New York, New York and Toledo, Ohio and various outlet stores are located in leased space. The Company also uses various warehouses as needed on a month-to-month basis. Class 5 Prepetition Term Loan Claims are impaired. Each holder of an Allowed Term Loan Claim will receive (i) its Pro Rata share of 100% of the New Equity Interests Pool (subject to dilution by the New Management Incentive Plan Equity), and (ii) such other plan consideration as may be agreed between the Debtors and the Super-Majority Term Loan Lenders. Class 6 General Unsecured Claims are impaired. Each Holder of an Allowed General Unsecured Claim will receive, in full satisfaction, settlement, discharge and release of, and in exchange for, such Claim, its Pro Rata share of the General Unsecured Recovery Cash Pool. Each holder of an Old Parent Interest in Class 8 will not receive any distribution or retain any property on account of such Old Parent Interest. All cash necessary for the Debtors or the Reorganized Debtors, as applicable, to make payments required pursuant to the Plan will be obtained from their respective cash balances, including Cash from operations and the Exit Loan Facility. A full-text copy of the Disclosure Statement dated June 22, 2020, is available at https://tinyurl.com/yc8hd5kl from PacerMonitor.com at no charge. Counsel for the Debtors: John H. Knight Russell C. Silberglied Paul N. Heath Zachary I. Shapiro RICHARDS, LAYTON & FINGER, P.A. One Rodney Square 920 North King Street Wilmington, Delaware 19801 Telephone: (302) 651-7700 Facsimile: (302) 651-7701 - and - George A. Davis Keith A. Simon David Hammerman Anu Yerramalli Madeleine C. Parish LATHAM & WATKINS LLP 885 Third Avenue New York, New York 10022 Telephone: (212) 906-1200 Facsimile: (212) 751–4864 About Libbey Inc. Based in Toledo, Ohio, Libbey Inc. (NYSE American: LBY) is one of the largest glass tableware manufacturers in the world. Libbey operates manufacturing plants in the U.S., Mexico, China, Portugal and the Netherlands. In existence since 1818, Libbey supplies tabletop products to retail, foodservice and business-to-business customers in over 100 countries. Libbey's global brand portfolio, in addition to its namesake brand, includes Libbey Signature, Master's Reserve, Crisa, Royal Leerdam, World Tableware, Syracuse China, and Crisal Glass. In 2019, Libbey's net sales totaled $782.4 million. For more information, visit http://www.libbey.com/ Libbey Glass Inc. and 11 of its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11439) on June 1, 2020. In the petition signed by CEO Michael P. Bauer, Libbey Glass was estimated to have $100 million to $500 million in assets and $500 illion to $1 billion in liabilities as of the bankruptcy filing. The Hon. Laurie Selber Silverstein is the case judge. Debtors tapped Latham & Watkins LLP and Richards, Layton & Finger, P.A., as counsel; Alvarez & Marsal North America, LLC as financial advisor; and Lazard Ltd as investment banker. Prime Clerk LLC is the claims agent, maintaining the page https://cases.primeclerk.com/libbey. MANNKIND CORP: Incurs $10.3 Million Net Loss in Second Quarter -------------------------------------------------------------- MannKind Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting a net loss of $10.25 million on $15.11 million of total revenues for the three months ended June 30, 2020, compared to a net loss of $12.39 million on $15 million of total revenues for the three months ended June 30, 2019. The lower net loss is mainly attributable to a decrease in operating expenses of $2.9 million. The reduction in the net loss per share was impacted by both lower operating expenses and a greater number of outstanding shares. "I am proud of how our employees pulled together during these uncertain times and innovated as a team to minimize the impact of the COVID-19 pandemic on our business during the second quarter," said Michael Castagna, chief executive officer. "A small 3% reduction in Afrezza TRx compared to the first quarter, when there was a bolus of prescriptions due to patient stockpiling, reflects the successful execution of our commercial plan in a new virtual environment. We faced many challenges during this quarter, but whether it was production personnel ensuring Afrezza supply through the end of the year, the research team producing clinical supplies for our collaboration partner, United Therapeutics, the field force executing new sales tactics or home office staff adapting to a totally virtual environment, our team exceeded all expectations." For the six months ended June 30, 2020, the Company reported a net loss of $19.57 million on $31.35 million of total revenues compared to a net loss of $27.27 million on $32.45 million of total revenues for the six months ended June 30, 2019. As of June 20, 2020, the Company had $102.78 million in total assets, $282.49 million in total liabilities, and a total stockholders' deficit of $179.71 million. Cash, cash equivalents and restricted cash at June 30, 2020 was $63.5 million compared to $50.2 million at Dec. 31, 2019, which also included short-term investments of $20.0 million. The increase was primarily due to the receipt of a $12.5 million United Therapeutics milestone payment, $12.2 million of net proceeds received from the at-the-market offering, $11.6 million received from warrant exercises and the origination of a Paycheck Protection Program loan for $4.9 million, offset by non-GAAP net cash used in operating activities of $27.4 million. The Company is not currently profitable and has rarely generated positive net cash flow from operations. In addition, the Company expects to continue to incur significant expenditures for the foreseeable future in support of its manufacturing operations, sales and marketing costs for Afrezza, and development costs for product candidates in the Company's pipeline. As of June 30, 2020, the Company had an accumulated deficit of $3.0 billion and $122.6 million of total principal amount of outstanding borrowings, with limited capital resources of $63.2 million in cash and cash equivalents. The Company said these financial conditions raise substantial doubt about its ability to continue as a going concern. Chief Commercial Officer As previously announced, Alejandro Galindo, M.B.A, M.S., joined the Company on Aug. 4, 2020 as chief commercial officer. Mr. Galindo has an accomplished track-record of over 25 years in the healthcare, energy, and consumer industries. He spent the past six years at Medtronic as vice president and president of the Advanced Insulin Management Business Unit, where he led a fast-paced, double-digit growth global business within their diabetes division. Prior to Medtronic, Mr. Galindo spent nine years at General Electric (GE) Healthcare in a variety of leadership roles, leading emerging markets, strategic corporate development and global supply chain operations. Prior to joining GE's Healthcare division, he spent eleven years in various global leadership positions for the company's energy and appliance sectors, overseeing advanced manufacturing engineering and product development. Mr. Galindo received a B.Sc. in Industrial & Systems Engineering from Monterrey Institute of Technology, Mexico and M.B.A. and M.S. degrees from Indiana University. A full-text copy of the Form 10-Q is available for free at: https://is.gd/MnA6Dm About MannKind Corporation MannKind Corporation (NASDAQ: MNKD) focuses on the development and commercialization of inhaled therapeutic products for patients with diseases such as diabetes and orphan lung diseases. MannKind is currently commercializing Afrezza (insulin human) Inhalation Powder, the Company's first FDA-approved product and the only inhaled ultra rapid-acting mealtime insulin in the United States, where it is available by prescription from pharmacies nationwide. MannKind is headquartered in Westlake Village, California, and has a state-of-the art manufacturing facility in Danbury, Connecticut. The Company also employs field sales and medical representatives across the U.S. For further information, visit http://www.mannkindcorp.com/ MannKind reported a net loss of $51.90 million for the year ended Dec. 31, 2019, compared to a net loss of $86.97 million for the year ended Dec. 31, 2018. As of Dec. 31, 2019, the Company had $93.72 million in total assets, $284.25 million in total liabilities, and a total stockholders' deficit of $190.53 million. Deloitte & Touche LLP, in Los Angeles, California, the Company's auditor since 2001, issued a "going concern" qualification in its report dated Feb. 25, 2020, citing that the Company's available cash resources and continuing cash needs raise substantial doubt about its ability to continue as a going concern. MEN'S WEARHOUSE: Moody's Cuts PDR to D-PD on Chapter 11 Filing -------------------------------------------------------------- Moody's Investors Service downgraded The Men's Wearhouse, Inc. ratings, including its probability of default rating to D-PD from Caa2-PD, corporate family rating to Ca from Caa2, senior secured term loan rating to Ca from Caa2, and unsecured notes to C from Ca. The speculative-grade liquidity rating was downgraded to SGL-4 from SGL-3 and the ratings outlook was changed to stable from negative. Its actions follow the company's announcement [1] that it has filed for protection under Chapter 11 of the US Bankruptcy Code. Downgrades: Issuer: Men's Wearhouse, Inc. (The) Probability of Default Rating, Downgraded to D-PD from Caa2-PD Speculative Grade Liquidity Rating, Downgraded to SGL-4 from SGL-3 Corporate Family Rating, Downgraded to Ca from Caa2 Senior Secured Bank Credit Facility, Downgraded to Ca (LGD4) from Caa2 (LGD4) Senior Unsecured Regular Bond/Debenture, Downgraded to C (LGD6) from Ca (LGD6) Outlook Actions: Issuer: Men's Wearhouse, Inc. (The) Outlook, Changed To Stable From Negative RATINGS RATIONALE "The global coronavirus pandemic severely disrupted Tailored Brands' businesses, which were already facing challenges due to execution issues and a challenging retail environment," stated Moody's retail analyst, Mike Zuccaro. "Its Chapter 11 filing, which has support of over 75% of its senior lenders, will allow the company to reduce debt, rationalize its store base, and focus on executing its plan to drive profitable growth." 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. Fitch regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Its action reflects the impact on Men's Wearhouse of the deterioration in credit quality it has triggered, given its exposure to men's apparel, which has left it vulnerable to shifts in market demand and sentiment in these unprecedented operating conditions. Subsequent to its actions, Moody's will withdraw the ratings due to Men's Wearhouse's bankruptcy filing. Men's Wearhouse, Inc. is a subsidiary of Tailored Brands, Inc., which operates around 1,445 stores in the U.S. and Canada under the Men's Wearhouse, Jos. A. Bank, Moores Clothing for Men and K&G brands. LTM revenue for the period ended May 2, 2020 approached $2.8 billion The principal methodology used in these ratings was Retail Industry published in May 2018. MOUNTAIN STATES ROSEN: May Sell Assets to Swift Beef for $14.25M ---------------------------------------------------------------- In the bankruptcy case captioned In re: MOUNTAIN STATES ROSEN, LLC, Chapter 11, Debtor, Case No. 20-20111 (Bankr. D. Wy.), Bankruptcy Judge Cathleen D. Parker granted the motion filed by Debtor Mountain States Rosen, LLC., to liquidate its assets. The Debtor determined that reorganization was not viable and proceeded toward liquidating its assets. An auction was conducted on July 9, 2020, in accordance with the approved Bid Procedures. The auction resulted in the determination that Swift Beef Company, a Delaware Corporation, presented the highest and best offer for the assets. Swift offered a cash purchase price of $14,250,000. The back-up bidder, Greeley Fab LLC (FAB), objects to the Debtor's determination that Swift's offer was the highest and best offer. FAB is a Wyoming limited liability company formed March 4, 2020. Frank Moore is listed as its organizer and registered agent. He is also a co-owner and manager. FAB is an insider of the Debtor under 11 U.S.C. Section 101(31), due to the connection with Mr. Moore. Mr. Moore testified he is and has been the chairman of the Debtor's board since 2008. He is vice chairman of the Mountain States Coop, the organization that owns 87% of the Debtor. Mr. Moore owns 6%. Mr. Moore testified the purpose FAB was formed was to purchase the Debtor prior to it's bankruptcy filing. However, the Debtor claims due to an unfunded pension liability, it filed for bankruptcy protection. The Official Unsecured Creditors' Committee and CoBank, ACB, the Debtor's largest secured creditor, support the sale to Swift. The International Brotherhood of Teamsters is the only other creditor supporting the FAB offer. To approve a sale of substantially all of the Debtor's assets outside the ordinary course of business, the Debtor must show: (1) that a sound business reason exists for the sale; (2) there has been adequate and reasonable notice to interested parties, including full disclosure of the sale terms and the Debtor's relationship with the buyer; (3) that the sale price is fair and reasonable; and (4) that the proposed buyer is proceeding in good faith. The court needs to find the evidence establishes a good business reason to grant an application to sell substantially all of the Debtor's assets outside the confines of a confirmed plan. The Debtor proffered testimony supporting all of the elements. Upon cross-examination, none of the parties challenged these elements nor that there was good business reason to sell the assets. Instead, the issue before the Court is whether another offer by JBS is the "highest and best" offer when it does not assume the PPP loan nor does it plan to continue operations of the facility as a lamb processing plant. Per the bidding procedures, the Debtor had discretion to determine the highest and best bid. FAB argues the value of the PPP loan assumption should be the full value of the loan at $3.95 million instead of $1.25 million. It also asserts the Debtor should have added a value based on its intent to continue lamb processing operations and the impact to the industry if Swift converts the plant to a beef facility. Section 5(c) of the bid procedures explains: "The Debtor in Its Authorized Discretion, upon consultation with CoBank and the Committee, shall have the exclusive right to value any Overbid Increment that includes Non-Cash Consideration." According to the Court, a debtor's business judgment enjoys "great judicial deference," but this discretion is not without limit. Deference to a debtor's decision as to a successful bidder of its assets is appropriate, and the court should honor that decision unless it is proven the debtor abused its discretion. "It is only in the context of a strong and unusual case to the contrary in which a bankruptcy court should approve a sale to a party which the DIP does not deem the highest and/or best bidder in an auction sale." "A debtor's business decision should be approved by the court unless it is shown to be so manifestly unreasonable that it could not be based upon sound business judgment, but only on bad faith, or whim or caprice." Regardless of a debtor's discretion, the Court continues, debtors, in conducting the sale process, have a fiduciary duty to maximize the value of their estates. The fiduciary duty does not require the Debtor to mechanically accept a bid with the highest dollar amount. The Debtors are permitted, and in fact are encouraged, to evaluate other factors such as contingencies, conditions, timing, or other uncertainties in an offer that may render it less appealing. The Court says no parties presented evidence there was concern over either bidders' financial ability to complete the deal or other material contingencies. The Court also notes that, from the approved bid procedures, it appears the drafting parties attributed no value to the loan assumption. The Debtor received a stalking horse offer from FAB for the aggregate purchase price of $10,000,000, plus assumption of certain liabilities, including the PPP Loan from Converse County Bank of Douglas, Wyoming, in the principal amount of $3,595,000. To be a qualified bid, a party had to submit an offer in $100,000 increments beginning at no less than $10.1 million. Had FAB believed there was measurable value to the assumption or going concern value, they could have insisted and demanded a qualified bid be more than $13,595,000 at a minimum. The Court says it is sympathetic to contributing to both the unemployment situation during such troubling times and potentially further suppressing the lamb market. However, the evidence creates questions as to the benefit of the going-concern operation. Mr. Moore testified FAB intends to operate the processing facility. Ideally, FAB wants to continue the employment of workers, retain services of vendors and the infrastructure of the processing facility for the region for the greater good. However, beyond the testimony he wanted to continue the business of the processing facility, there was no evidence that the facility could operate at full capacity or any type of prepared business plan, the Court says. Mr. Frank stated historically there are not enough lambs to run at capacity year-round, as the largest percentage are born within four-five months, going to market within six months with Easter and Christmas being the strongest time for market demand. There was mention of the difficulty of getting stock to market, during this Covid-19 time, but no indication FAB being awarded the winning bid would resolve this issue, the Court says. Most importantly, this is not the continued operation of Debtor, but the operation of the facility under new owners. Thomas M. Kim, the Debtor's financial advisor, from r2 advisors llc, testified it was an impossible task to analyze the going concern value of FAB, as it is not the Debtor. The court finds this is not a factor carrying weight to disregard the Debtor's discretion for approval of the Swift bid. FAB has not shown the Debtor's determination Swift is the highest and best offer, to be so manifestly unreasonable that it could not be based upon sound business judgment. There is no evidence of bad faith, nor that the decision was made on a whim or with caprice, the Court adds. A copy of the Court’s Memorandum Opinion dated July 21, 2020 is available at https://bit.ly/33iA7nB from Leagle.com. 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. MURRAY METALLURGICAL: Joy Global, IDC Industries Leave Committee ---------------------------------------------------------------- The U.S. Trustee for Regions 3 and 9 disclosed in a court filing that as of Aug. 4, C & A Cutter Head, Inc. and United Central Ind. and Supply Co. LLC are the remaining members of the official committee of unsecured creditors appointed in the Chapter 11 cases of Murray Metallurgical Coal Holdings, LLC and its affiliates. The committee's legal counsel has informed the bankruptcy watchdog that Joy Global and IDC Industries, Inc., former members of the committee, have already received full payment on their respective critical vendor agreements and have waived the remainder of their pre-bankruptcy claims. About Murray Metallurgical Coal Holdings Murray Metallurgical Coal Holdings and its affiliates are engaged in the mining and production of metallurgical coal. They own and operate two active coal mining complexes and other assets in Alabama and West Virginia. On Feb. 11, 2020, Murray Metallurgical Coal Holdings and five affiliates each filed a voluntary Chapter 11 petition (Bankr. S.D. Ohio Lead Case No. 20-10390). Murray Metallurgical was estimated to have $100 million to $500 million in assets and liabilities as of the bankruptcy filing. Judge John E. Hoffman, Jr. oversees the cases. Debtors have tapped Proskauer Rose LLP as legal counsel, Evercore Group LLC as investment banker, Alvarez & Marsal LLC as financial advisor, Prime Clerk LLC as claims agent, and Hilco Valuation Services LLC as valuation expert. The U.S. Trustee for Regions 3 and 9 appointed a committee of unsecured creditors on Feb. 25, 2020. The committee has tapped Lowenstein Sandler LLP and Wickens Herzer Panza as its legal counsel, and Berkeley Research Group, LLC as its financial advisor. OCCASION BRANDS: U.S. Trustee Appoints Creditors' Committee ----------------------------------------------------------- The U.S. Trustee for Region 2 on Aug. 3, 2020, appointed a committee to represent unsecured creditors in the Chapter 11 case of Occasion Brands, LLC. The committee members are: 1. Ashdon Brands d/b/a Impression and Impression Bridal 11100 West Airport Blvd. Stafford, Texas 77477 Attention: Nick Yeh, CEO 2. Jovani Fashion, Ltd. 42 West 39th Street, 6th Floor New York, New York 10018 Attention: John Behette, Corporate Controller 3. Kleinfeld Bridal Corp. 110 West 20th Street New York, New York 10011 Attention: John R. Costantino, Director Attention: Ronald Rothstein, CEO 4. Marita Fashion Inc. d/b/a Dancing Queen 1129 San Julian Street, Suite C Los Angeles, CA 90015 Attention: Michael Jin, CEO 5. Sherri Hill, Inc. 1100 E Howard Ln., STE 575 Austin, Texas 78753 Attention: Dusty Hill, President 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 Occasion Brands Founded in 1998, Occasion Brands, LLC is a family of e-commerce websites that focuses on prom, homecoming, bridal, and other special occasion events. It is a pure-play e-commerce platform for prom dresses and operates its business through three web properties: promgirl.com, simplydresses.com, and KleinfeldBridalParty.com.r teen events. Visit https://www.occasionbrands.com for more information. Occasion Brands sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y., Case No. 20-11684) on July 22, 2020. Robert Nolan, chief restructuring officer, signed the petition. At the time of the filing, the Debtor was estimated to have assets of $1 million to $10 million and liabilities of $10 million to $50 million. S. Jason Teele, Esq. and Daniel J. Harris, Esq., of Sills Cummins & Gross P.C. serve as Debtor's counsel. Insight Partners, LLC, is the Debtor's Restructuring Advisor, and Omni Agent Solutions is the claims and noticing agent. OFFICE UPRISING: Plan Confirmation Hearing on Aug. 12 ----------------------------------------------------- Judge Sandra R. Klein has ordered that the Disclosure Statement and Plan of Reorganization with its modifications set forth below and described in the Amended Disclosure Statement and Amended Plan of Reorganization filed by Office Uprising, LLC are approved. In order to be counted, a completed Ballot accepting or rejecting the Plan must be received by the Kogan Law Firm, APC, 1849 Sawtelle Blvd., Suite 700, Los Angeles, CA, 90025, Attention: Michael S. Kogan, by no later than July 6, 2020. The Motion for approval of the Plan, Ballot Tally, and supporting declarations shall be filed and served by the Plan Proponent by July 13, 2020. Any opposition to confirmation of the Plan, and supporting declarations shall be filed and served by no later than July 20, 2020. Any response to opposition to the Plan, will be served by the Plan Proponents by no later than July 27, 2020, only upon those parties who have filed an objection to the Plan, those parties who have voted against the Plan, and the United States Trustee. The confirmation hearing on the Plan shall be held on August 12, 2020, at 9:00 a.m. The Court Status Conference shall be continued to August 12, 2020, at 9:00 a.m., with no status report required to be filed. The following modifications to the Disclosure Statement and Plan of Reorganization were made on the record of the hearing and are to be incorporated into the Amended "Plan" to be served on parties in interest: a. Page 13, line 7, for Class One now reads: The prepetition and post-petition DGA Claim shall be paid in full on the Effective Date, pursuant to the terms of the security agreements and may be paid directly to DGA through the Freeway Account as such amounts as are accumulated and owed to DGA b. Page 13, line 19, for Class Two now reads: The prepetition and post-petition SAGAFTRA Claim shall be paid in full on the Effective Date, pursuant to the terms of the security agreements and may be paid directly to SAG-AFTRA c. Page 14, line 13, for Class Three now reads: The prepetition and post-petition WGAW Claim shall be paid in full on the Effective Date, pursuant to the terms of the security agreements and may be paid directly to WGAW d. Page 15, line 4, for Class Four now reads: The prepetition and post-petition MPIPHP Claim shall be paid in full on the Effective Date, pursuant to the terms of the security agreements and may be paid directly to MPIPHP e. Page 17, line 17, for Administrative Expense #1 now reads: ESTIMATED TOTAL: $70,000 f. Page 45 omitted language included as follows: Once the Plan has been consummated, a final decree may be entered upon motion of the Proponent. The effect of the final decree is to close the bankruptcy case. After such closure, a party seeking any type of relief relating to a Plan provision can seek such relief in a state court of general jurisdiction. Attorneys for the Debtor: Michael S. Kogan KOGAN LAW FIRM, APC 1849 Sawtelle Blvd., Suite 700 Los Angeles, California 90025 Telephone (310) 954-1690 mkogan@koganlawfirm.com About Office Uprising Office Uprising, LLC, owns movie rights to the "Office Uprising" film. Office Uprising sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 19-11840) on Feb. 21, 2019. At the time of the filing, the Debtor disclosed $1,786,000 in assets and $2,984,002 in liabilities. The case is assigned to Judge Sandra R. Klein. The Debtor tapped Kogan Law Firm, APC, as its legal counsel. POWER SOLUTIONS: Pays Out $750K Executive Bonuses in 2019 --------------------------------------------------------- Power Solutions International, Inc. paid out bonus awards under the Company's 2019 Key Performance Indicator plan to the Company's named executive officers identified in the Company's Form 10-K/A filed with the Securities and Exchange Commission on June 15, 2020. As of the time of filing of the Form 10-K/A, the KPI payouts for the year ended Dec. 31, 2019 had not been determined and were not then calculable and, therefore, were not reported in the "Bonus" column of the 2019 Summary Compensation Table set forth in the Form 10-K/A. All other compensation for the Company's named executive officers for the year ended Dec. 31, 2019 was previously reported by the Company in the 2019 Summary Compensation Table included in the Form 10-K/A. The aggregate Bonus amounts earned and the total compensation paid to the named executive officers of the Company with respect to the year ended Dec. 31, 2019, recalculated to include the 2019 KPI bonuses, are set forth below. Name and Principal Position Year Bonus1 Total ------------------ ------- -------- -------- John P. Miller Chief Executive Officer and President 2019 $274,949 $636,137 Charles F. Avery, Jr. Chief Financial Officer 2019 $155,980 $474,354 Kenneth J. Winemaster Executive Vice President 2019 $227,387 $567,481 Jason C. Lin Chief Technical Officer 2019 $91,395 $582,053 The amounts reported for Messrs. Miller and Winemaster for 2019 represent payment of the final installments of their key employee retention program bonuses in the amounts of $57,600 and $44,109, respectively, and their 2019 Key Performance Indicator bonuses in the amounts of $217,349 and $183,278, respectively. The amounts reported for Messrs. Avery and Lin represent their 2019 KPI bonus amounts. Mr. Avery resigned as chief financial officer of the Company effective July 20, 2020. About Power Solutions Headquartered in Wood Dale, Illinois, Power Solutions International, Inc. -- http://www.psiengines.com/-- designs, engineers, and manufactures emissions-certified, alternative-fuel power systems. PSI provides integrated turnkey solutions to global original equipment manufacturers in the industrial and on-road markets. The Company's unique in-house design, prototyping, engineering and testing capacities allow PSI to customize clean, high-performance engines that run on a wide variety of fuels, including natural gas, propane, biogas, gasoline and diesel. As of March 31, 2020, the Company had $290.03 million in total assets, $262.09 million in total liabilities, and $27.94 million in total stockholders' equity. BDO USA, LLP, in Chicago, Illinois, the Company's auditor since 2018, issued a "going concern" qualification in its report dated May 4, 2020 citing that significant uncertainties exist about the Company's ability to refinance, extend, or repay outstanding indebtedness and maintain sufficient liquidity to fund its business activities. These factors raise substantial doubt about the Company's ability to continue as a going concern. PRESTIGE HEATING: Unsecureds get Prorata Cash Payments of $4500 --------------------------------------------------------------- Prestige Heating and Air Conditioning, LLC, filed a Plan and a Disclosure Statement. PHAC enjoyed commercial success but ventured into the plumbing industry in early 2016 and suffered economic loss due to the expansion. Class 3 – Secured Vehicular Claims are impaired. Holders of Secured Claims in Class 3, which include the claims of Chrysler and Santander shall receive Pro Rata Cash Payments of their Claims thirty (30) days following the Effective Date with interest bearing at 5.5% for a term of 60 months. Holders of Allowed Claims in Class 3 will retain all liens it currently holds and will release the title to their collateral when their Claims are paid in full. Class 5 –General Unsecured Claims are impaired. Holders of General Unsecured Claims will receive, in full satisfaction of their Claims, monthly Pro Rata Cash Payments of $4,500 for the term of 36 months with payments commencing 24 months from the Effective Date. Payments and distributions under the Plan will be funded from the continued operations of PHAC. A full-text copy of the Disclosure Statement dated June 24, 2020, is available at https://tinyurl.com/y9yn4mqb from PacerMonitor.com at no charge. Attorneys for the Debtor: Adam Corral Susan Tran Brendon Singh CORRAL TRAN SINGH, LLP 1010 Lamar, Suite 1160 Houston TX 77002 Tel: (832) 975-7300 Fax: (832) 975-7301 E-mail: Susan.Tran@ctsattorneys.com About Prestige Heating Prestige Heating and Air Conditioning, LLC, filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 19-3529) on Sept. 23, 2019. The Debtor is represented by Susan Tran Adams, Esq., of CORRAL TRAN SINGH LLP. PROMISE HEALTHCARE: Unsecureds may Recover 11-36% of its Claim -------------------------------------------------------------- Promise Healthcare Group, LLC., et al., and Official Committee of Unsecured Creditors submitted a Plan and a Disclosure Statement. Under the terms of the Plan, holders of allowed claims will receive the following treatment: * Settlement Claims (Class 4): This class may recover 1% to 2% of its claims. Each Holder of an Allowed Settlement Claim, on or as soon as practicable after the Effective Date, shall receive its Pro Rata share of the Class A Interest, which shall entitle each such holder to share Pro Rata in the Class A Trust Recovery. * Alleged Legal Expense Indemnification Claims (Class 5): This class may recover 0% to 100% of its claims. Each Holder of an Allowed Alleged Legal Expense Indemnification Claim, on or as soon as practicable after the later of the Effective Date or the date on which such Alleged Legal Expense Indemnification Claim becomes an Allowed Alleged Legal Expense Indemnification Claim, shall receive its Pro Rata share of the Legal Expense Indemnification Recovery. * General Unsecured Claims (Class 6): This class may recover 11% to 36% of its claims. Each Holder of an Allowed General Unsecured Claim, on or as soon as practicable after the later of the Effective Date or the date on which such General Unsecured Claim becomes an Allowed General Unsecured Claim, shall receive its Pro Rata share of the Class B Interest, which shall entitle each such Holder to share Pro Rata in the Class B Trust Recovery. * Convenience Claims (Class 7): This class may recover 14% of its claims. Each Holder of an Allowed Convenience Class Claim, on or as soon as practicable after the later of the Effective Date or the date on which such Convenience Class Claim becomes an Allowed Convenience Class Claim, shall receive Cash in an amount equal to 14% of the amount of such Holder’s Allowed Convenience Class Claim. With respect to equity interests in Class 9, on the Effective Date, all Equity Interests shall be deemed extinguished. All Distributions shall be funded by existing Cash on hand with the Debtors and their Estates as of the Effective Date, including any Cash proceeds from the sales of assets of the Debtors; the collection of accounts receivable; the litigation of Causes of Action by the Debtors, the Debtor Representative, or Liquidating Trustee and the proceeds thereof, as applicable, prior to or after the Effective Date; and the recovery and/or liquidation of any and all other assets of the Debtors and their Estates by the Liquidating Trustee on and after the Effective Date. A full-text copy of the Disclosure Statement dated June 24, 2020, is available at https://tinyurl.com/y8xjs65u from PacerMonitor.com at no charge. Counsel for the Debtors: Stuart M. Brown Matthew S. Sarna DLA PIPER LLP (US) 1201 N. Market Street, Suite 2100 Wilmington, DE 19801 Telephone: (302) 468-5700 Facsimile: (302) 394-2341 Email: Stuart.Brown@dlapiper.com Matthew.Sarna@dlapiper.com John Tishler Katie G. Stenberg Blake D. Roth Tyler N. Layne WALLER LANSDEN DORTCH & DAVIS, LLP 511 Union Street, Suite 2700 Nashville, TN 37219 Telephone: (615) 244-6380 Facsimile: (615) 244-6804 Email: John.Tishler@wallerlaw.com Katie.Stenberg@wallerlaw.com Blake.Roth@wallerlaw.com Tyler.Layne@wallerlaw.com Counsel to the Official Committee of Unsecured Creditors: Jeffrey N. Pomerantz, Esq. Bradford J. Sandler, Esq. Colin R. Robinson, Esq. PACHULSKI STANG ZIEHL & JONES LLP 919 N. Market Street, 17th Floor Wilmington, DE 19801 Telephone: (302) 652-4100 Facsimile: (302) 652-4400 E-mail: jpomerantz@pszjlaw.com bsandler@pszjlaw.com crobinson@pszjlaw.com Andrew H. Sherman Boris I. Mankovetskiy SILLS CUMMIS & GROSS P.C. One Riverfront Plaza Newark, NJ 07102 Telephone: 973-643-7000 Facsimile: 973-643-6500 Email: asherman@sillscummis.com bmankovetskiy@sillscummis.com About Promise Healthcare Established in 2003, Promise Healthcare is a specialty post-acute care health company headquartered in Boca Raton, Florida. Promise Healthcare Group, LLC, and its affiliates sought bankruptcy protection on Nov. 4, 2018 (Bankr. D. Del. Lead Case No. 18-12491). In the petition signed by Andrew Hinkelman, CRO, the Debtors were estimated to have assets of up to $50,000 and liabilities of $50 million to $100 million. The Debtors tapped DLA Piper LLP and Waller Lansden Dortch & Davis, LLP, as general counsel; FTI Consulting, as financial and restructuring advisor; Houlihan Lokey and MTS Health Partners, L.P., as investment bankers; and Prime Clerk LLC as claims agent. QUOTIENT LIMITED: Reports First Quarter Fiscal 2021 Results ----------------------------------------------------------- Quotient Limited reported its first quarter fiscal 2021 results and summarized recent key developments. Quotient currently has three areas of focus related to its proprietary MosaiQ technology: first, Quotient has successfully developed and begun generating revenues from its new MosaiQ COVID-19 antibody test application; second, Quotient is pursuing new applications for its MosaiQ platform; and third, the Company continues to pursue commercialization of its MosaiQ transfusion diagnostic applications. Recently, significant progress has been made in all three areas. COVID-19 antibody test - Independent tests have validated Quotient's earlier findings that the test is extremely accurate. Quotient now has ten COVID-19 antibody test contracts with customers in Europe and the US. FDA Emergency Use Authorization (EUA) for the MosaiQ COVID-19 Antibody Test is expected soon. Potential New MosaiQ applications – Quotient has started a process of outreach to potential major customers interested in customized microarray menus. With a view to better understand market requirements and preferences these discussions and potential future collaborations will inform future MosaiQ development activity. Transfusion diagnostics -- Field trials of the expanded MosaiQ IH microarray, that were delayed by COVID-19 related shut-downs, have restarted at all three European sites, and the Company expects following completion of those tests to have the first powerful commercial transfusion diagnostics combination, Initial Serological Disease Screening (SDS) and Expanded Immunohematology microarrays, available for sale in Europe in Q1 2021. The Company also announced a continuous strong top line growth for Alba by Quotient reagents for its first quarter ended June 30, 2020. MosaiQ Platform MosaiQ, Quotient's next-generation platform, is designed to deliver fast immunohematology, serological and molecular disease screening, using a single low volume sample on a high throughput, multimodal multiplexing automated platform. MosaiQ represents a transformative and highly disruptive unified testing system for transfusion diagnostics and beyond. Feasibility to deliver required performance in serological and molecular disease screening has been demonstrated. MosaiQ offers the potential to significantly reduce complexity and improve workflow for our customers. A serological test was developed in April 2020 in response to the global COVID-19 pandemic. The MosaiQ COVID-19 Antibody Microarray is CE marked and available for distribution in Europe, including Switzerland, and the UK. Regulatory and Commercial Milestones * Results from European independent studies -- Separate studies were conducted with independent labs in Madrid, Spain and in Paris, France; the studies confirmed the high- performance characteristics of the Company's MosaiQ COVID-19 Antibody Microarray and led to securing sales contracts with both labs. * US Regulatory approval – 510(k) approval for the Initial SDS microarray and the MosaiQ device is anticipated before the end of calendar year 2020. * Field Trials -- Restarted the last site for the Expanded IH field trials in Europe in May. With this, the trial has resumed on all three sites and receipt of CE mark approval is anticipated by Q1 CY2021 * The first powerful transfusion diagnostics commercial combination (Initial SDS and Expanded IH microarrays) expected to be available for sale in Europe by Q1 of calendar year 2021 * Russell 2000 and 3000 Indexes -- Quotient was added to the indexes effective June 29, 2020 as part of the 2020 Russell U.S. indexes Quotient CEO Franz Walt commented, "I am very pleased with our recent achievements and progress. The roll-out of our COVID-19 antibody test demonstrates the power and flexibility of the MosaiQ platform. The launch of our expanded transfusion menu is now only a few months away. We are encouraged by initial comments from potential customers who have shown a strong interest and appetite for the innovation that MosaiQ represents. Based on that feedback we will decide on which new applications to pursue going forward." Fiscal Fourth Quarter and Full Year Financial Results "The Alba by Quotient reagent business continues to deliver top line growth, with strong product sales of $8.9 million in the first quarter, up 9.2% from the quarter ended June 30, 2019, with no indications of any significant adverse effects from the COVID-19 pandemic," said Franz Walt. Mr. Walt added, "This performance was driven by 7.8% growth in sales to OEM customers, while direct product sales grew 8.1%. The initial product sales related to the MosaiQ COVID-19 Antibody test were $0.1 million in the first quarter. In the quarter ended June 30, 2020, gross margin on product sales declined to 39.3% of product sales compared to the gross margin of 44.1% reported in the quarter ended June 30, 2019. Year over year, gross margin was adversely impacted mainly by an increase in expenses attributed to operating restrictions related to the COVID-19 pandemic." The operating loss for the quarter ended June 30, 2020 included legal and advisory fees of $1.0m related to the Company's termination of its distribution and supply agreement with Ortho Clinical Diagnostics Inc. (OCD) and the related arbitration with OCD. Capital expenditures totaled $0.8 million in the quarter ended June 30, 2020, compared with $1.1 million in the quarter ended June 30, 2019. As at June 30, 2020 Quotient had $94.5 million in available cash and other short-term investments and $155.1 million of debt and $8.7 million in an offsetting long-term cash reserve account. Outlook for the Fiscal Year Ending March 31, 2021 * Total product sales of Alba by Quotient reagents are still expected to be in the range of $32 to $34 million compared to product sales in fiscal 2020 of $31.6 million. A forecast of COVID-19 antibody tests is not currently possible due to the uncertainties related to the development of this new market. No other revenues are expected. * Capital expenditures in the range of $5 to $10 million. * Average monthly cash use for operations in the range of $5 to $6 million excluding potential revenue related to COVID- 19 antibody test. Alba by Quotient product sales in the second quarter of fiscal 2021 are expected to be within the range of $7.5 to $8.0 million, compared with $7.1 million for the second quarter of fiscal 2020. The Company is not providing guidance on the operating loss due to the uncertainty around revenues derived from MosaiQ by Quotient COVID-19 antibody tests. Quarterly product sales can fluctuate depending upon the shipment cycles for red blood cell-based products, which account for approximately two-thirds of current product sales. These products typically experience 13 shipment cycles per year, equating to three shipments of each product per quarter, except for one quarter per year when four shipments occur. The timing of shipment of bulk antisera products to OEM customers may also move revenues from quarter to quarter. Some seasonality in demand is also experienced around holiday periods in both Europe and the United States. As a result of these factors, Quotient expects to continue to see seasonality and quarter-to-quarter variations in product sales. About Quotient Limited Penicuik, United Kingdom-based Quotient Limited is a commercial-stage diagnostics company committed to reducing healthcare costs and improving patient care through the provision of innovative tests within established markets. With an initial focus on blood grouping and serological disease screening, Quotient is developing its proprietary MosaiQTM technology platform to offer a breadth of tests that is unmatched by existing commercially available transfusion diagnostic instrument platforms. The Company's operations are based in Edinburgh, Scotland; Eysins, Switzerland and Newtown, Pennsylvania. Quotient Limited reported a net loss of $102.77 million for the year ended March 31, 2020, compared to a net loss of $105.4 million for the year ended March 31, 2019. As of March 31, 2020, the Company had $226.46 million in total assets, $231.99 million in total liabilities, and a total shareholders' deficit of $5.53 million. Ernst & Young LLP, in Belfast, United Kingdom, the Company's auditor since 2007, issued a "going concern" qualification in its report dated June 12, 2020, citing that the Company is currently involved in an arbitration dispute with a customer and an adverse outcome of this dispute in addition to the Company's expenditure plans over the next 12 months could result in net cash outflows over the next 12 months exceeding the Company's existing available cash and short-term investment balances, and has stated that substantial doubt exists about the Company's ability to continue as a going concern. RAVN AIR: Unsecureds Will Get Prorata Share of Creditors Fund ------------------------------------------------------------- Ravn Air Group, Inc., et al., submitted a First Amended Chapter 11 Plan of Liquidation. Class 1 Prepetition Secured Creditor Claims are impaired. On the Effective Date, each Holder of an outstanding Prepetition Secured Creditor Claim shall be issued One Class B Liquidation Trust Interest in exchange for every Thousand Dollars ($1,000) of such Holder’s Class 1 Claim. Class 4 General Unsecured Claims are impaired. Each holder of such Allowed General Unsecured Claim will receive its pro rata share of the Creditors' Fund. As of the Effective Date, all Equity Interests in Class 6 shall be deemed void, cancelled, and of no further force and effect. The Plan will be implemented by various acts and transactions as set forth in the Plan, including, among other things, the establishment of the Liquidation Trust, the appointment of the Liquidation Trustee, and the making of Distributions by the Liquidation Trust. A full-text copy of the First Amended Chapter 11 Plan of Liquidation dated June 24, 2020, is available at https://tinyurl.com/ya5vpju8 from PacerMonitor.com at no charge. Counsel to the Debtors: Victoria A. Guilfoyle Stanley B. Tarr Jose F. Bibiloni BLANK ROME LLP 1201 N. Market Street, Suite 800 Wilmington, Delaware 19801 Telephone: (302) 425-6400 Facsimile: (302) 425-6464 - and - Tobias S. Keller Jane Kim Thomas B. Rupp KELLER BENVENUTTI KIM LLP 650 California Street, Suite 1900 San Francisco, California 94108 Telephone: (415) 496-6723 Facsimile: (650) 636-9251 About Ravn Air Ravn Air Group, Inc. -- https://www.flyravn.com/ -- was formed through the combination of five Alaskan air transportation businesses in 2009, creating the largest regional air carrier and network in the state. Ravn owns and, until the COVID-19-related disruptions, operated 72 aircraft at 21 hub airports and 73 facilities, serving 115 destinations in Alaska with up to 400 daily flights. Until the COVID-19-related disruptions, Ravn Air Group and its affiliates had over 1,300 employees (non-union), and it carried over 740,000 passengers on an annual basis. Ravn Air Group provides air transportation and logistics services to the passenger, mail, charter, and freight markets in Alaska, pursuant to U.S. Department of Transportation approval as three separate certificated air carriers. Two of the carriers (RavnAir ALASKA and PenAir) operate under Federal Aviation Administration Part 121 certificates and the other (RavnAir CONNECT) operates under an FAA Part 135 certificate. In addition to carrying passengers, many of whom fly on Medicaid-subsidized tickets, other key customers include companies in the oil and gas industry, the seafood industry, the mining industry, and the travel and tourism industries. Ravn Air Group and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-10755) on April 5, 2020. At the time of the filing, the Debtors were estimated to have assets of between and $100 million to $500 million and liabilities of the same range. Judge Brendan Linehan Shannon oversees the cases. The Debtors tapped Keller Benvenutti Kim LLP as bankruptcy counsel; Blank Rome LLP as special corporate and local bankruptcy counsel; Conway Mackenzie, LLC as financial advisor; and Stretto as claims and noticing agent. RICHARD M. KERGER: District Court Retains Tax Liability Cases ------------------------------------------------------------- District Judge Christopher A. Boyko rules that the cases captioned RICHARD M. KERGER, ET AL., Plaintiffs, v. UNITED STATES OF AMERICA, Defendant. UNITED STATES OF AMERICA, Plaintiff, v. RICHARD M. KERGER, ET AL., Defendants, Case Nos. 3:17CV00994, 3:17CV1041 (N.D. Ohio) will stay in federal district court and will not be referred to the bankruptcy court. This matter is before the Court on the parties' supplemental briefs on whether the issues presented in the cases should be determined by the Bankruptcy Court as core issues. On Nov. 19, 2015, Plaintiffs filed their original Complaint seeking a declaratory judgment, injunctive relief or, in the alternative, a determination that the United States is equitably estopped from collecting on any alleged tax liabilities owed by the Kergers. The United States filed a Motion to Dismiss, which was subsequently granted by the Court without prejudice. The Court determined the Declaratory Judgment Act did not apply to actions to determine federal tax issues. The Court further held that Plaintiffs' Complaint failed to assert sufficient facts such that their claims were plausible under applicable United States Supreme Court precedent. On May 10, 2017, the Kergers refiled their Complaint with this Court again seeking a Declaratory Judgment that they owed no federal taxes and asking the Court to equitably estop the United States from attempting to collect federal taxes the Kergers contend were discharged in bankruptcy. The United States moved to dismiss the newly refiled Complaint but also filed a separate action in this Court to reduce to judgment the Kergers' alleged tax liabilities. In turn, the Kergers filed a Counterclaim in the United States' action asserting the same claims they assert in their refiled Complaint. On a Motion to Dismiss, the Court determined the Kergers could not obtain a Declaratory Judgment on the amount of taxes owed as tax determinations are specifically exempted from the Declaratory Judgment Act. The Court denied the United States' Motion to Dismiss the Kergers' Equitable Estoppel claim, holding the Kergers had asserted sufficient facts to support the claim. The Court then instructed the parties to submit supplemental briefs regarding whether the United States' Complaint seeking a judgment on the Kergers' tax liabilities and the Kergers' Equitable Estoppel claims are core proceedings requiring referral back to the Bankruptcy Court for determination. The Kergers do not oppose referral to Bankruptcy Court while the Government opposes such a referral. The United States argues there is concurrent jurisdiction between the District Court and Bankruptcy Court to hear dischargeability issues. However, Bankruptcy Court lacks jurisdiction to enforce a judgment against property that is not property of the bankruptcy estate. Further, the United States asserts the Bankruptcy Court lacks jurisdiction over its Complaint because its claims do not arise under Title 11 but rather 26 U.S.C.section 7401 and section 7402. There is no question this Court has jurisdiction under 28 U.S.C. section 1345, to determine the claims presented. Consequently, the United States argues the Court should retain jurisdiction where as here, there is no question it may hear the claims as opposed to referral to Bankruptcy Court where its jurisdiction is dubious. The United States also argues that the claims are not subject to the jurisdiction of the Bankruptcy Court because the Kergers' bankruptcy case closed in 2010, thus, any action by the Court in the above proceedings would have no effect on the long-disposed bankruptcy estate action. Furthermore, the Bankruptcy Court would have no jurisdiction to hear the Kergers' Equitable Estoppel claim and the Bankruptcy Court lacks authority to enforce a judgment on the United States' claims against the Kergers. According to the Court, the Kergers' Complaint does not point the Court to any Bankruptcy Code provision providing the basis of its discharge claim. Instead, it relies primarily on its Equitable Estoppel argument. Furthermore, the Kergers assert this Court's federal question jurisdiction found in 28 U.S.C. section 1331. Neither does the United States rely on the Bankruptcy Code for the Court's jurisdiction. Because there are questions concerning the Bankruptcy Court's jurisdiction to hear the entirety of the claims and defenses presented, and because there is no question District Court has jurisdiction to adjudicate all the claims presented, the District Court will retain both cases and will not refer to them to the Bankruptcy Court at this time, subject to revisiting the issue should discovery or legal argument warrant referral. A copy of the Court's Opinion and Order dated July 21, 2020 is available at https://bit.ly/3fc3TMQ from Leagle.com. Richard M. Kerger filed for chapter 11 bankruptcy protection (Bankr. N.D. Ohio Case No. 08-33967) on July 29, 2008. ROSE COURT: First Amended Suit vs Select Portfolio et al. Tossed ---------------------------------------------------------------- In the case captioned ROSE COURT, LLC, Plaintiff, v. U.S. BANK NA, successor trustee to Bank of America, NA, successor in interest to LaSalle Bank NA, as trustee, on behalf of the holders of the WaMu Mortgage Pass-Through Certificates, Series 2007-HY7, its assignees and/or successors, by and through its servicing agent Select Portfolio Servicing, Inc.; SELECT PORTFOLIO SERVICING, INC.; and QUALITY LOAN SERVICE CORPORATION, Defendants, Adversary Case No. 19-03058-DM (Bankr. N.D. Cal.), Bankruptcy Judge Dennis Montali granted the Defendants' motion to dismiss the Debtor's first amended complaint (FAC) and denied Debtor's motion to amend the first amended complaint. In this adversary proceeding, the Debtor is attempting to invalidate a foreclosure sale that occurred on Nov. 25, 2019, of certain property located in Monte Sereno, California. The Debtor asserts in the FAC and in other pleadings that no foreclosure sale actually occurred. Paragraph 15 of the FAC states that the sale was postponed: "On Nov. 25, 2019, at 10:22 a.m., the date of the supposed auction, having been no bids by the creditor nor the public, LAM announced publicly that the sale would be postponed, upon which, on information and belief, all bidders relied." The Debtor alleges in paragraph 16 of the FAC that on Dec. 5, 2019, "despite the sale having been publicly postponed after no bids and no credit bid, Quality fraudulently executed a Trustee's Deed Upon Sale allegedly transferring the Subject Property to Defendant U.S. Bank pursuant to the falsely alleged Foreclosure Sale." According to the Court, the FAC itself provides a transcript of the sale that is inconsistent with the contention that the sale was postponed and did not occur. Despite the clear statement by the auctioneer at the duly noticed foreclosure sale, the Debtor asserts that the sale was postponed. After the sale concluded and was verbally confirmed, the Debtor's managing members asked the auctioneer about the consequences of the new bankruptcy case on the sale. The transcript of the sale is clear and any other conversations between the managing members and the auctioneer do not overcome the presumption of the validity of the foreclosure sale, particularly when the trustee's deed was delivered. That presumption became conclusive upon delivery of the trustee's deed to the successful bidder. The motion to dismiss is, therefore, granted, the Court says. In the Motion to Amend and the proposed second amended complaint ("SAC"), the Debtor contends that the underlying note and deed of trust are unenforceable. The SAC alleges that the signature of managing member Teri H. Nguyen was forged. This is at least the fourth action since 2017 filed by Nguyen and the Debtor contesting the validity and enforceability of the underlying note and the deed of trust. Federal Rule of Civil Procedure 41(a)(1)(B), made applicable by Federal Rule of Bankruptcy Procedure 7041, provides that a voluntary dismissal is without prejudice unless the plaintiff previously dismissed any federal or state court action based on or including the same claim. Since 2017, the Debtor has voluntarily dismissed several actions against Select Portfolio and Quality that -- like the current action -- challenged their right to foreclose. According to the Court, the Debtor seeks to amend the FAC to add claims that the note and deed of trust on the Property are unenforceable for reasons unrelated to the foreclosure sale. The claims the Debtor seeks to add were asserted in three lawsuits that the Debtor voluntarily dismissed. Under Rule 41(a)(1), these two voluntary dismissals operate as an adjudication on the merits of the claims the Debtor wants to add. Consequently, because such an amendment is futile, the Court denies the Debtor's Motion to Amend. A copy of the Court's Memorandum Decision dated July 22, 2020 is available at https://bit.ly/3k1ngf9 from Leagle.com. About Rose Court Rose Court, LLC, a real estate company, was the owner of a real property located at 15520 Quito Road, Monte Sereno, California, valued by the company at $3.50 million. The Company previously sought bankruptcy protection on Feb. 1, 2010 (Bankr. N.D. Cal. Case No. 10-50993) and Nov. 6, 2012 (Bankr. N.D. Cal. Case No. 12-58012). Rose Court, based in San Francisco, California, filed a Chapter 11 petition (Bankr. N.D. Cal. Case No. 17-31014) on Oct. 10, 2017. In the petition signed by Teri Nguyen, managing member, the Debtor disclosed $3.51 million in assets and $3.28 million in liabilities. Judge Hannah L. Blumenstiel presides over the case. Vince D. Nguyen, Esq., at Newton Law Group, serves as the Debtor's bankruptcy counsel. The Debtor filed its proposed Chapter 11 plan of reorganization and disclosure statement on January 10, 2018. SFP FRANCHISE: Aug. 10 Combined Hearing on Plan & Disclosures ------------------------------------------------------------- On June 24, 2020, the U.S. Bankruptcy Court for the District of Delaware entered an order approving, the Disclosure Statement of SFP Franchise Corporation, et al. on an interim basis. A combined hearing to consider final approval of the Disclosure Statement and confirm the Plan will commence on August 10, 2020 at 10:00 a.m. (ET) before the Honorable John T. Dorsey, United States Bankruptcy Judge, in the United States Bankruptcy Court for the District of Delaware, located at 824 Market Street, 5th Floor, Courtroom No. 5, Wilmington, DE 19801. The Bankruptcy Court has established August 3, 2020 at 4:00 p.m. (ET), as the last date and time for filing and serving objections to the adequacy of the information in the Disclosure Statement and to confirmation of the Plan. Deadline to file Claims Objections for Voting Purposes Only: July 16, 2020 at 4:00 p.m. (prevailing Eastern Time). Deadline to Respond to Claims Objections and to File 3018(a) Motions: July 30, 2020 at 4:00 p.m. (prevailing Eastern Time). Deadline to File Plan Supplement: July 27, 2020 at 4:00 Voting Deadline: August 3, 2020 at 5:00 p.m.(prevailing Eastern Time) Deadline for Debtors to File Voting Report (which shall also include a list of those who opted out of the third party releases): August 5, 2020 at 4:00 p.m. (prevailing Eastern Time) Deadline for Debtors to File Confirmation Brief and/or Reply to any Plan or Disclosure Statement Objections, Supporting Declarations and the Proposed Form of Order Approving the Disclosure Statement and Confirming the Plan: August 6, 2020 at 10:00 a.m. (prevailing Eastern Time) Deadline for Debtors to Respond to 3018 (a) Motions: August 6, 2020 at 10:00 a.m. (prevailing Eastern Time) The following chart summarizes the classification and treatment of Claims and Interests under the Plan: * AG Secured Claims (Class 4). A total claim of $38,706,673.00 and may recover 0%. * AG Deficiency Claims (Class 5). A total claim of $37,906,000.00 and may recover 0%. * General Unsecured Claims (Class 6). A total claim of $38,000,000.00 and may recover 3.5% to 4.5%. * Intercompany Claims (Class 7). May recover 0%. * Subordinated Claims (Class 8). May recover 0%. * Interests (Class 9). May recover 0%. Members of Class 4 (AG Secured Claims), Class 5 (AG Deficiency Claims) and Class 6 (General Unsecured Claims) may vote to accept or reject the Plan. Members of Class 1 (Secured Tax Claims), Class 2 (Other Secured Claims) and Class 3 (Other Priority Claims) are unimpaired and deemed to accept the Plan. Members of Class 7 (Intercompany Claims), Class 8 (Subordinated Claims) and Class 9 (Interests) are deemed to reject the Plan. Accordingly, holders of Claims or Interests in Classes 1, 2, 3, 7, 8 and 9 are not entitled to vote on the Plan. In order for your vote to count, holders of Claims in the Voting Class must complete, date, sign and properly mail the enclosed Ballot (please note that envelopes have been included with the Ballot) to: SFP Franchise Corporation Ballot Processing c/o Omni Agent Solutions 5955 De Soto Ave, Ste 100 Woodland Hills, CA 91367 Alternatively, holders of Claims in the Voting Class may submit the Ballot via electronic online transmission solely through the customized online balloting portal (the "Balloting Portal") on the Debtors' case website, http://www.omniagentsolutions.com/sfp,and clicking on the link for balloting on or before the Voting Deadline. Holders of Claims submitting the Ballot via the Balloting Portal must not submit a ballot by mail. Pursuant to Bankruptcy Rule 3017, the Bankruptcy Court has ordered that original Ballots for the acceptance or rejection of the Plan must be received by mail or overnight delivery by Omni at the address set forth above on or before 5:00 p.m. (Eastern Time) on August 3, 2020. Once you have delivered your Ballot, you may not change your vote, except for cause shown to the Bankruptcy Court after notice and hearing. A full-text copy of the Disclosure Statement dated June 24, 2020, is available at https://tinyurl.com/yc5tagea from PacerMonitor.com at no charge. A full-text copy of Notice dated June 24, 2020, is available at https://tinyurl.com/y8n442up from PacerMonitor.com at no charge. Counsel to the Debtors: Adam G. Landis Matthew B. McGuire Nicolas E. Jenner LANDIS RATH & COBB LLP 919 Market Street, Suite 1800 Wilmington, DE 19801 Telephone: (302) 467-4400 Facsimile: (302) 467-4450 About SFP Franchise Co. and Schurman Fine Papers SFP Franchise Corporation and Schurman Fine Papers sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-10134) on Jan. 23, 2020. At the time of the filing, the Debtors each had estimated assets of between $10 million and $50 million and liabilities of between $50 million and $100 million. Judge John T. Dorsey oversees the cases. The Debtors tapped Landis Rath & Cobb, LLP as their legal counsel, and Omni Agent Solutions as claims and noticing agent. SHEPPARD AND SON: Creditors to Be Paid in Full With Interest ------------------------------------------------------------ Sheppard and Son Properties, LLC., filed a Chapter 11 Plan that says creditors will be paid in full and in cash with interest thereon. Class 4 consists of the secured claim held by Colony Bank. The holder of the Class 4 claim shall be paid as secured to the extent of the value of its interest, $83,568. The claimant will be paid the secured value in full in 96 equal monthly installments of principal and interest with interest calculated at 5% per annum for an estimated payment of $1,000 per month. Payments will commence on the first day of the month following the Effective Date. (Court claim no. 3). Class 8 will consist of the secured claim held by Robert K. Bell, Jr. Investments, Inc. The claimant will be paid as secured to the extent of the value of its interest, $13,169. The holder of the Class 8 claim will be paid the secured value in full in 120 equal monthly installments of principal and interest with interest calculated at 10% per annum. Principal and Interest payments will commence on the first day of the month following the Effective Date. The approximate monthly payment amount will be $151.24. Class 12 will consist of the secured claim held by Robert K. Bell, Jr. Investments, Inc. The holder of the Class 12 claim woll be paid as secured to the extent of the value of its interest, $4,843. The holder of the Class 12 claim will be paid the secured value in full without further interest within 90 days of the Effective Date. Class 14 will consist of the secured claim held by JKS Merrell Farms, LLC. The holder of the Class 14 claim shall be paid as secured to the extent of the value of its interest, $10,800. The holder of the Class 14 claim will be paid the secured value in full in 120 equal monthly installments of principal and interest with interest calculated at 10% per annum. Principal and Interest payments will commence on the first day of the month following the Effective Date. The approximate monthly payment amount will be $133.94. Class 15 shall consist of the secured claim held by JKS Merrell Farms, LLC. The claimholder will be paid as secured to the extent of the value of its interest, $8,400. The holder of the Class 15 claim will be paid the secured value in full in 120 equal monthly installments of principal and interest with interest calculated at 10% per annum. Principal and interest payments will commence on the first day of the month following the Effective Date. The approximate monthly payment amount will be $104.18. Class 16 shall consist of the secured claim held by JKS Merrell Farms, LLC. The holder of the Class 16 claim shall be paid as secured to the extent of the value of its interest, $12,000. The holder of the Class 16 claim shall be paid the secured value in full in 120 equal monthly installments of principal and interest with interest calculated at 10% per annum. Principal and Interest payments will commence on the first day of the month following the Effective Date. The approximate monthly payment amount will be $148.82. Class 18 consists of all allowed unsecured claims. There are no claims in this class to be paid. Class 19 consists of the Debtor’s equity interest. All interests will be retained. The funds to be distributed in this plan are superior to dividend in a Chapter 7 case. The Debtor is paying cash money over time to redeem properties and pay off debts. Creditors will be paid in full under this plan with interest with payments beginning immediately after confirmation. This is in contrast to a Chapter 7 liquidation where a Trustee would need time to market and sell properties and distribution would likely take place at the end of the case after several years. A full-text copy of the Disclosure Statement dated June 22, 2020, is available at https://tinyurl.com/y9c2r392 from PacerMonitor.com at no charge. Attorney for the Debtor: DANIEL L. WILDER LAW OFFICES OF EMMETT L. GOODMAN, JR., LLC 544 Mulberry Street, Suite 800 Macon, Georgia 31201-2776 Tel: (478) 745-5415 E-mail: dwilder@goodmanlaw.org About Sheppard and Son Properties Sheppard and Son Properties, LLC, a nonresidential building operator in Cordele, Georgia, filed a Chapter 11 petition (Bankr. M.D. Ga. Case No. 18-11388) on Nov. 6, 2018. In the petition signed by Greene Wylie Sheppard, Jr., sole member, the Debtor disclosed $1,202,487 in total assets and $224,757 in total liabilities. The case is assigned to Judge Austin E. Carter. The Debtor is represented by Emmett L. Goodman, Jr., LLC. STOKES INC: Seeking to Continue Proceedings Under CCAA ------------------------------------------------------ Stokes Inc. has filed a notice of intention to make a proposal under the relevant provisions of the Bankruptcy and Insolvency Act, and Richter Advisory Group Inc. was appointed as trustee. The company is currently seeking to continue its restructuring proceedings under the Companies' Creditors Arrangement Act. The company said it submits that an orderly process under the CCAA will beneficial to all stakeholders, as it allow the completion of the restructuring process initiated by the company under the BIA, which process has been delayed by the sudden and unforeseen global COVID-19 pandemic. In March 2019, due to the growing global COVID-19 pandemic, several provincial governments ordered the temporary closure of shopping malls and of a number of businesses deemed to be non-essential. As a result, Stokes had no choice but to close all stores and temporarily lay off all of its employees working therein. Accordingly, the sale was interrupted. Information regarding the CCAA proceedings and the Corporation is available on the Monitor's website at https://www.richter.ca/insolvencycase/stokes-inc/ The monitor can be reached at: Richter Advisory Group Inc. Attn: Olivier Benchaya 1981 McGill College avenue, Suite 1100 Montreal, Quebec H3A 0G6 Tel: 514-934-8618 Email: obenchaya@richter.ca Counsel for the Company: Osler, Hoskin & Harcourt LLP Attn: Sandra Abitan Julien Morissette Ilia Kravtsov 1000 de La Gauchetiere Street West, Suite 2100 Montreal, Quebec H3B 4W5 Telephone: (514) 904-8100 Fax: (514) 904-8101 Email: sabitan@osler.com jmorissette@osler.com ikravtsov@osler.com Incorporated in 1957, Stokes Inc. -- https://www.stokesstores.com/en/ -- sells a variety of merchandise, including merchandise primarily marketed under the "Stokes" and "Thinkkitchen" brands. The Company has retail operations across Canada. SUNOPTA INC: Reports $1.6 Million Net Loss for Second Quarter ------------------------------------------------------------- SunOpta Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting a loss attributable to common shareholders of $1.60 million for the quarter ended June 27, 2020, compared to a loss attributable to common shareholders of $11.05 million for the quarter ended June 29, 2019. For the two quarter ended June 27, 2020, the Company reported a loss attributable to common shareholders of $261,000 on $646.89 million of revenues compared to earnings attributable to common shareholders of $12.60 million on $598.28 million of revenues for the two quarters ended June 29, 2019. As of June 27, 2020, the Company had $909.42 million in total assets, $664.34 million in total liabilities, $84.88 million in series A preferred stock, $26.89 million in series B preferred stock, and $133.30 million in total equity. "We delivered another strong quarter, doubling adjusted EBITDA over the prior year for the third consecutive quarter. We believe our turnaround efforts have now taken root, setting us up for more consistent revenue and profitability growth going forward. The quarter represented a powerful combination of strong execution and favorable underlying category trends. Each of our three segments produced revenue growth and expanded gross margin during the second quarter," said Joe Ennen, chief executive officer of SunOpta. "Our growth continues to be led by our #1 focus area, which is plant-based foods and beverages. Despite the negative impact on volumes in the foodservice channel, as a result of COVID-19, we still produced 10% growth on an adjusted basis. This growth and our ability to offset COVID-19 impacts are a direct reflection of the strength of our plant-based platform. We are extremely bullish on our plant-based opportunity including a robust sales pipeline and incremental capacity expected to come on-line in the fourth quarter of this year. "Within our Global Ingredients segment, we saw continued strong growth and enhanced margin as we optimize our category investments. We remain confident and encouraged about initiatives across our global organization and remain well-positioned in each of our operating segments to drive growth, improve margins and enhance shareholder value. We continued to generate sequential and year-over-year margin improvement in our Fruit-Based Foods and Beverages segment, reflecting each of our initiatives to date and remain confident that our productivity investments will further this improvement in the second half of 2020," continued Ennen. Revenues for the second quarter of 2020 were $310.9 million, an increase of 6.1% compared to $293.0 million in the second quarter of 2019. Excluding the impact of changes in commodity-related pricing and foreign exchange rates, revenues in the second quarter of 2020 increased by 5.8% compared with the second quarter of 2019. The Plant-Based Foods and Beverages segment generated revenues of $91.7 million during the second quarter of 2020, an increase of 11.9% compared to $81.9 million in the second quarter of 2019. Excluding sunflower commodity price variances, Plant-Based segment revenues in the second quarter increased 9.6% compared to the prior year period, reflecting higher volumes of aseptic beverages, broth offerings, and ingredient extraction partially offset by reduced sales volumes of plant-based beverage products to foodservice customers as a result of COVID-19. The Global Ingredients segment generated revenues of $126.5 million, an increase of 4.7% compared to $120.9 million in the second quarter of 2019. Excluding the impact of changes in commodity-related pricing and foreign exchange rates, Global Ingredients revenue in the second quarter of 2020 increased 6.9% compared to the prior year period, which reflected higher volumes in certain organic ingredient product categories and of premium juice products. The Fruit-Based Foods and Beverages segment generated revenues of $92.7 million during the second quarter of 2020, an increase of 2.8% compared to $90.2 million in the second quarter of 2019. Excluding the impact of commodity price fluctuations, Fruit-Based segment revenues in the second quarter increased 0.8% compared to the prior year period, primarily reflecting increased retail volumes and pricing for frozen fruit partially offset by lower demand for frozen fruit and fruit preparations from foodservice customers as a result of COVID-19. Gross profit was $39.7 million for the quarter ended June 27, 2020, an increase of $12.4 million compared to $27.3 million for the quarter ended June 29, 2019. As a percentage of revenues, gross profit for the quarter ended June 27, 2020 was 12.8% compared to 9.3% for the quarter ended June 29, 2019, an increase of 350 basis points. The Plant-Based Foods and Beverages segment accounted for $4.6 million of the increase in gross profit, primarily due to higher sales and production volumes of plant-based beverages, broths and plant-based ingredients, and improved plant utilization and productivity-driven cost savings partially offset by wage premiums and higher cleaning costs attributable to COVID-19. The Global Ingredients segment accounted for $4.4 million of the increased gross profit in the quarter primarily due to increased pricing spreads for certain organic ingredients and premium juice products and productivity improvements. The Fruit-Based Foods and Beverages segment increased gross profit by $3.4 million in the quarter, reflecting increased sales, pricing and a favorable sales mix of higher-margin retail versus foodservice sales, and the impact of our automation and productivity initiatives, partially offset by lower sales volumes and plant utilization for fruit ingredients, together with wage premiums and higher cleaning costs attributable to COVID-19. Segment operating income¹ was $8.8 million, or 2.8% of revenues in the second quarter of 2020, compared to operating loss of $2.5 million, or 0.9% of revenues in the second quarter of 2019. The increase in operating income year-over-year was primarily attributable to the $12.4 million increase in gross profit, partially offset by a year-over-year $1.0 million increase in SG&A primarily related to higher employee-related variable compensation and benefit costs, partially offset by lower travel and marketing costs and stock-based compensation expense. During the second quarter of 2020, cash generated by operating activities was $2.7 million, compared to cash used in operations of $31.7 million during the second quarter of 2019. The $34.4 million improvement in operating cash flow primarily reflects the improved year-over-year operating results, along with more efficient working capital management. Cash used in investing activities in the second quarter of 2020 was $6.3 million, compared with $12.9 million in the second quarter of 2019, a decrease in cash used of $6.6 million. A full-text copy of the Form 10-Q is available for free at: https://is.gd/1Zfucn About SunOpta Inc. Headquartered in Ontario, Canada, SunOpta Inc. is a global company focused on plant-based foods and beverages, fruit-based foods and beverages, and organic ingredient sourcing and production. SunOpta specializes in the sourcing, processing and packaging of organic, natural and non-GMO food products, integrated from seed through packaged products; with a focus on strategic vertically integrated business models. SunOpta reported a loss attributable to common shareholders of $8.78 million for the year ended Dec. 28, 2019, compared to a net loss attributable to common shareholders of $117.11 million for the year ended Dec. 29, 2018. As of March 28, 2020, the Company had $894.42 million in total assets, $676.39 million in total liabilities, $84.55 million in series A preferred stock, $and $133.47 million in total equity. * * * As reported by the TCR on June 2, 2020, S&P Global Ratings raised its issuer credit rating on Mississauga, Ont.-based food and beverage manufacturer SunOpta Inc. to 'CCC+' from 'CCC'. "We forecast SunOpta's operating performance to improve meaningfully in fiscal 2020. The upgrade reflects our favorable view of the company's execution on its turnaround initiatives across its business divisions, particularly the growth in its plant-based foods and beverages segments," S&P said. SUNPOWER CORP: Posts $19.4 Million Net Income in Second Quarter --------------------------------------------------------------- SunPower Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting net income attributable to stockholders of $19.38 million on $352.91 million of revenue for the three months ended June 28, 2020, compared to net income attributable to stockholders of $121.46 million on $436.28 million of revenue for the three months ended June 30, 2019. For the six months ended June 28, 2020, the Company reported net income attributable to stockholders of $17.95 million on $802.10 million of revenue compared to net income attributable to stockholders of $31.73 million on $784.51 million of revenues for the six months ended June 30, 2019. As of June 28, 2020, the Company had $1.94 billion in total assets, $1.89 billion in total liabilities, and $41.30 million in total equity. "We were pleased with our second quarter performance as strong execution enabled us to exceed our guidance, generate close to $30 million in positive cash flow and launch new products despite the Covid-19 virus disruption," said Tom Werner, SunPower CEO and chairman of the board. "Overall, we saw improving trends in our global DG business throughout the quarter with particular strength in our U.S. channels business where the investments in our digital initiatives enabled us to successfully transition to an on-line model. We also took a number of important steps to complete the spin-off of Maxeon Solar Technologies as their 20-F was declared effective with an expected record date of Aug. 17, 2020 and distribution date of Aug. 26, 2020. Finally, we continued our leadership in innovation as we launched a number of new products including our SunVault residential storage solution, our OneRoof product for new homes as well as Maxeon's launch of its new bifacial, shingled panel for the global power plant market. Looking forward, our fundamentals remain strong and are well-positioned for success given our differentiated model, new products and strong balance sheet." "Our second quarter performance reflected the resilience of our business and strong execution as we quickly responded to the Covid-19 disruption," said Manavendra Sial, SunPower chief financial officer. "Our rapid response, along with the proactive implementation of a number of initiatives, enabled us to achieve positive cash generation for the quarter with $500 million in liquidity identified for Sun Power post spin. Additionally, we were pleased to see Maxeon complete its successful $200 million convertible green bond offering and closure of $125 million in banking facilities. As a result, both companies will be well capitalized post transaction. Finally, we added to our financing flexibility in the Commercial Direct space as we closed a new, innovative financing facility that allows for more efficient working capital utilization while improving our economics." Second quarter of fiscal year 2020 non-GAAP results exclude net adjustments that, in the aggregate, increased non-GAAP loss by $56.6 million, including $71.1 million related to gain on mark-to-market gain on equity investments, and $10.5 million related to gain on business divestiture. This was partially offset by $9.6 million related to the cost of above-market polysilicon, $5.9 million related to stock-based compensation expense, $4.1 million related to business reorganization costs and restructuring charges, $2.4 million transaction-related costs, $1.8 million related to amortization of intangible assets, and $1.2 million related to other non-recurring items and tax effects. Financial Outlook The Company's third quarter 2020 GAAP and non-GAAP guidance is as follows: on a GAAP and non-GAAP basis, revenue of $360 million to $400 million, GAAP gross margin of 0 percent to 5 percent and net loss of $110 million to $95 million. The Company's third quarter 2020 Non-GAAP gross margin and Adjusted EBITDA guidance, on a combined basis, now includes an approximate $40 million impact for the entire quarter in its SPT segment as a result of its out of market polysilicon contract. Additionally, upon completion of the Maxeon spin-off, expected on Aug. 26, 2020, the obligation under the polysilicon contract will be retained by Maxeon and will expire in fiscal 2022. As a result, the company expects third quarter 2020 non-GAAP gross margin of 0 percent to 6 percent and Adjusted EBITDA guidance in the range of negative $35 million to negative $20 million with SPT in the range of negative $38 to $28 million and SPES in the range of positive $8 to $14 million. The Company also expects megawatts recognized to be in the range of 500 MW to 560 MW as well as positive cash generation for SunPower in the third quarter. For the fourth quarter and after the Company's expected spin-off of Maxeon, both companies expect a continued improvement in the global solar demand environment through the end of the year, with particular strength in the DG segment. A full-text copy of the Form 10-Q is available for free at: https://is.gd/XBUTU0 About SunPower Headquartered in San Jose, California, SunPower Corporation -- http://www.sunpower.com-- is a global energy company that delivers complete solar solutions to residential, commercial, and power plant customers worldwide through an array of hardware, software, and financing options and through solar power solutions, operations and maintenance services, and "Smart Energy" solutions. The Company's Smart Energy initiative is designed to add layers of intelligent control to homes, buildings and grids -- all personalized through easy-to-use customer interfaces. SunPower reported a net loss of $7.72 million for the fiscal year ended Dec. 29, 2019, a net loss of $917.5 million for the fiscal year ended Dec. 30, 2018, and a net loss of $1.17 billion for the year ended Dec. 31, 2017. As of March 29, 2020, the Company had $1.99 billion in total assets, $1.98 billion in total liabilities, and $20.06 million in total stockholders' equity. SUNPOWER CORP: TZS Deposits $84.2M of Purchase Price Into Escrow ---------------------------------------------------------------- SunPower Corporation, Maxeon Solar Technologies, Ltd., and Tianjin Zhonghuan Semiconductor Co., Ltd., on July 31, 2020, entered into a Letter Agreement Related to Purchase Price Deposit, with respect to the Investment Agreement dated Nov. 8, 2019, by and among the Company, Maxeon, TZS, and, with respect to certain sections, Total Solar INTL SAS, as amended to date. Pursuant to the Letter Agreement, the parties agreed, among other things, that TZS would deposit $84.2 million of the purchase price into an escrow account (as it did on July 30, 2020), and thereafter, subject to specified conditions, within two business days after the last to occur of (i) Maxeon's Form 20-F being declared effective by the Securities and Exchange Commission and copies mailed to record holders, (ii) Aug. 12, 2020, and (iii) the first to occur of (A) applicable government approvals in connection with the transfer of the balance of the purchase price to the escrow account, and (B) Sept. 23, 2020, TZS will deposit, or will cause to be deposited, into the escrow account an amount in cash equal to the remainder of the purchase price. There can be no assurance that the spin-off or investment contemplated by the Investment Agreement, as amended to date and modified by the Letter Agreement, will ultimately be completed. About SunPower Headquartered in San Jose, California, SunPower Corporation -- http://www.sunpower.com-- is a global energy company that delivers complete solar solutions to residential, commercial, and power plant customers worldwide through an array of hardware, software, and financing options and through solar power solutions, operations and maintenance services, and "Smart Energy" solutions. The Company's Smart Energy initiative is designed to add layers of intelligent control to homes, buildings and grids -- all personalized through easy-to-use customer interfaces. SunPower reported a net loss of $7.72 million for the fiscal year ended Dec. 29, 2019, compared to a net loss of $917.5 million for the fiscal year ended Dec. 30, 2018. As of March 29, 2020, the Company had $1.99 billion in total assets, $1.98 billion in total liabilities, and $20.06 million in total stockholders' equity. TERRANCE J. MCCLINCH: Maine Bankr. Court To Hear Palsa Suit ----------------------------------------------------------- Bankruptcy Judge Michael A. Fagone holds that the case captioned Joseph A. Palsa, in his capacity as Trustee Under the Arthur L. McClinch Trust Dated April 3, 1981, Plaintiff, v. Terrance J. McClinch, Defendant, Adv. Proc. No. 20-1004 (Bankr. D. Me.) is a core proceeding and there is no Constitutional impediment to the entry of judgment. The Court will hear and determine this proceeding. The Federal Rules of Bankruptcy Procedure direct the Court to "decide . . . whether: (1) to hear and determine [an adversary] proceeding; (2) to hear the proceeding and issue proposed findings of fact and conclusions of law; or (3) to take some other action. This direction exists because of the requirements of the United States Constitution with respect to the exercise of judicial power. See generally Stern v. Marshall, 564 U.S. 462 (2011). At the Court's direction, the parties submitted memoranda addressing the appropriate course in this adversary proceeding. According to Judge Fagone, the Palsa proceeding is easily distinguishable from the proceeding in Stern v. Marshall. There, the debtor brought suit -- in the form of a counterclaim -- against a creditor seeking an affirmative recovery from the creditor in an effort to augment the bankruptcy estate. The counterclaim was not necessarily resolved in determining the creditor's claim against the bankruptcy estate. In Palsa's lawsuit, the debtor is a defendant, Judge Fagone continues. The Plaintiff's complaint does not seek to augment the estate; rather, the Plaintiff's complaint appears to be an effort to assert a claim against the estate (whether or not the confirmation order is revoked under 11 U.S.C. section 1144). The Court concludes that this is a core proceeding. A copy of the Court's Order dated July 22, 2020 is available at https://bit.ly/2XcQ1vE from Leagle.com. Terrance J. McClinch sought Chapter 11 protection (Bankr. D. Maine Case No. 18-10568) on Sept. 27, 2018. The Debtor tapped D. Sam Anderson, Esq., at Bernstein Shur Sawyer & Nelson. TRANS WORLD: Incurs $5.41 Million Net Loss in First Quarter ----------------------------------------------------------- Trans World Entertainment Corporation filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, reporting a net loss of $5.41 million on $31.59 million of net revenue for the 13 weeks ended May 2, 2020, compared to a net loss of $7.80 million on $35.13 million of net revenue for the 13 weeks ended May 4, 2019. As of May 2, 2020, the Company had $45.24 million in total assets, $44.79 million in total liabilities, and $452,000 in total shareholders' equity. The Company said its primary sources of liquidity are its borrowing capacity under its revolving credit facility, available cash and cash equivalents, and to a lesser extent, cash generated from operations. The Company's cash requirements relate primarily to working capital needed to operate and grow its business, including funding operating expenses and the purchase of inventory. The Company's ability to achieve profitability and meet future liquidity needs and capital requirements will depend upon numerous factors, including the timing and amount of its net revenue; the timing and amount of its operating expenses; the timing and costs of working capital needs; successful implementation of its strategy and planned activities; and its ability to overcome the impact of the COVID-19 pandemic. The Company has an accumulated deficit of $114.4 million at May 2, 2020 and net cash used in operating activities for the thirteen weeks ended May 2, 2020 was $ 6.5 million. Net cash used in operating activities for the thirteen weeks ended May 2, 2019 was 6.2 million. The Company experienced negative cash flows from operations during fiscal 2019 and 2018 and the Company expects to incur net losses in 2020. Trans World said, "The ability of the Company to meet its liabilities and to continue as a going concern is dependent on improved profitability, the continued implementation of the strategic initiative to reposition etailz as a platform of software and services, the availability of future funding, implementation of one or more corporate initiatives to reduce costs at the parent company level (which could include a voluntary delisting from NASDAQ and deregistering of our Common Stock in order to substantially eliminate the costs associated with being a public company), satisfying all unassumed liabilities of the fye segment and other strategic alternatives, including selling all or part of the remaining business or assets of the Company, and overcoming the impact of the COVID-19 pandemic. "There can be no assurance that we will be successful in further implementing our business strategy or that the strategy, including the completed initiatives, will be successful in sustaining acceptable levels of sales growth and profitability. In addition, the proceeds from the PPP Loan are subject to audit and there is a risk of repayment. For the next 12 months, management believes that the Company's existing liquidity will be adequate to fund its working capital needs. Management anticipates any cash requirements due to a shortfall in cash from operations will be funded by the Company's revolving credit facility..." At May 2, 2020, the Company had cash and cash equivalents of $7.1 million, net working capital of $10.4 million, and outstanding borrowings of $4.5 million on its revolving credit facility. A full-text copy of the Form 10-Q is available for free at: https://is.gd/27Arws About Trans World Headquartered in Albany, New York, Trans World Entertainment operates in two reportable segments: fye and etailz. The fye segment operates a chain of retail entertainment stores and e-commerce sites, http://www.fye.comand http://www.secondspin.com. The etailz segment is a digital marketplace retailer and generates substantially all of its revenue through Amazon Marketplace. Trans World reported a net loss of $58.74 million for the fiscal year ended Feb. 1, 2020, compared to a net loss of $97.38 million for the fiscal year ended Feb. 2, 2019. As of Feb. 1, 2020, the Company had $97.81 million in total assets, $93.29 million in total liabilities, and $4.51 million in total shareholders' equity. KPMG LLP, in Albany, New York, the Company's auditor since 1994, issued a "going concern" qualification in its report dated June 15, 2020, citing that the Company continues to experience recurring losses and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. TRC FARMS: Unsec. Creditors to Be Paid in Full in 10 Years in Plan ------------------------------------------------------------------ TRC FARMS, INC., owner of a swine finishing operation and a large row crop operation, filed a Plan of Reorganization and a Disclosure Statement. The total value of Debtor's real property is $3,509,821 and personal property is $1,928,174. Secured claims total $5,673,708. General unsecured claims total $515,659. The Debtor intends a partial liquidation of its real estate assets and to maintain ownership of its equipment and other personal property assets and utilize income and proceeds from these assets to fund their Plan of Reorganization and satisfy remaining secured and unsecured claims. All liabilities of the Debtor will be paid according to the priorities of the Bankruptcy Code. The Debtor proposes to make payments under the Plan from funds on hand and income derived from the continued operation of the Debtor's business activities, including farming operations. The Debtor will pay holders of allowed general unsecured claims the value of their respective claims, together with interest accruing at a rate set forth by the Federal Reserve, payable in equal installments over a period of 10 years, commencing Feb. 15, 2021, and continuing thereafter on the first day of each successive year; provided, however, that during the term of this treatment the Debtor may, within its discretion, defer not more than one payment for a period not to exceed 12 months. A full-text copy of the Disclosure Statement dated June 22, 2020, is available at https://tinyurl.com/ybqlgfzl from PacerMonitor.com at no charge. Attorneys for the Debtor: DAVID J. HAIDT N.C. AYERS & HAIDT, P.A. Post Office Box 1544 New Bern, NC 28563 Tel: (252) 638-2955 Fax: (252) 638-3293 E-mail: davidhaidt@embarqmail.com About TRC Farms Inc. TCR Farms, Inc., is the owner of a swine finishing operation and a large row crop operation farming approximately 3800 acres of corn, syobeans and peanuts in Craven County, North Carolina. The business is owned by Timmy ray Cox. TRC Farms, Inc., filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C. Case No. 20-00309) on Jan. 23, 2020. In the petition signed by Timmy R. Cox, president, the Debtor disclosed $3,846,275 in assets and $5,412,282 in liabilities. Judge Joseph N. Callaway oversees the case. The Debtor tapped Ayers & Haidt, PA as its legal counsel, and Carr Riggs & Ingram, LLC as its accountant. TRIUMPH GROUP: Moody's Cuts CFR to Caa3 & 2nd Lien Notes to Caa2 ---------------------------------------------------------------- Moody's Investors Service downgraded its ratings for Triumph Group, Inc., including the company's corporate family rating (CFR, to Caa3 from Caa2) and probability of default rating (to Caa3-PD from Caa2-PD). Concurrently, Moody's downgraded its ratings for the company's senior secured second lien notes (to Caa2 from Caa1) and senior unsecured notes (to Ca from Caa3). Moody's also assigned a B2 rating to the company's proposed new first lien senior secured notes. Proceeds from the note's issuance will be used to repay borrowings and terminate the company's revolving credit facility, with excess cash to be carried on the balance sheet in support of requisite liquidity needs over the coming years. The speculative grade liquidity rating was changed to SGL-3 from SGL-4, predicated on the assumed successful completion of the new first lien notes offering. The ratings outlook remains negative. "The downgrades reflect its assertion of rising default risk over the next few years given the company's deemed unsustainable leveraged capital structure and the multi-year recovery of the aerospace industry as anticipated," says Eoin Roche, Moody's Vice President and senior analyst covering Triumph. "This is notwithstanding the temporarily improved liquidity profile that Triumph will enjoy pending successful completion of its secured debt financing and targeted asset dispositions, albeit which Fitch believes will again be substantially depleted over the coming years and is likely to be insufficient to fully refinance maturing debt obligations," added Roche. RATINGS RATIONALE The Caa3 corporate family rating broadly balances Triumph's high financial leverage and weakening liquidity over time against its considerable scale and well-established presence as an aerospace supplier. Over the next few years, Moody's anticipates a very challenging operating environment for Triumph's commercial aerospace markets (about 55% of sales), precipitated in large part by the adverse impact of the coronavirus pandemic on the airline industry and the more pronounced and extended disruption that it has brought to manufacturers and suppliers in the commercial aerospace industry. Moody's expects fundamentally lower OEM production rates for most commercial aerospace platforms, coupled with significantly reduced aftermarket activity, both of which will weigh materially on future earnings and cash flow generation. Moody's recognizes Triumph's de-risking efforts over the last few years, as well as its meaningful exposure to military end markets (about 30% of sales), which are likely to remain relatively stable compared to the commercial aerospace business. That said, Moody's has concerns about what is expected to be very material and a prolonged period of cash consumption for Triumpch through at least fiscal year 2023. This cash consumption will be against a backdrop of an already highly leveraged balance sheet that will weaken meaningfully (with Moody's-adjusted debt-to-EBITDA of around 10x expected to about double over the next year), the absence of a committed revolver, and a persistently weak quality of earnings including a history of multiple large add-backs that reduce visibility into sustainable margin levels. The negative outlook incorporates Moody's expectation of material and prolonged disruptions from the coronavirus that will continue to weigh on Triumph's credit profile over the next few years. The negative outlook also reflects the company's anticipated weakening liquidity profile over time given significant cash burn and the absence of a committed revolving credit facility, and nothwithstanding sizable excess cash balances proforma for the pending financing transaction which will persist over the coming year or more. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to a ratings upgrade include an improving liquidity profile and meaningful strengthening of the company's key credit metrics. De-risking of the business through a divestiture or the use of sale proceeds to meaningfully reduce debt could also support upward ratings movement over time. Factors that could lead to a ratings downgrade include expectations of cash consumption beyond what is already contemplated in terms of cash consumption within the business. Delays or costs relating to the transfer of work on the G280, or if the strategic review of the Structures business pressures liquidity, could also cause downward ratings pressure. The following summarizes its rating actions: Issuer: Triumph Group, Inc. Corporate Family Rating, downgraded to Caa3 from Caa2 Probability of Default Rating, downgraded to Caa3-PD from Caa2-PD New first lien senior secured notes, assign B2 (LGD1) Senior Secured Regular Bond/Debenture, Downgraded to Caa2 (LGD3) from Caa1 (LGD3) Senior Unsecured Regular Bond/Debenture, downgraded to Ca (LGD5) from Caa3 (LGD5) Speculative Grade Liquidity rating, upgraded to SGL-3 from SGL-4 Outlook, Remains Negative Headquartered in Berwyn, Pennsylvania, Triumph Group, Inc. designs, engineers, manufactures, repairs, overhauls and distributes a broad portfolio of aero-structures, aircraft components, accessories, subassemblies and systems. The company serves the commercial aerospace (53% of sales), military (20%), business jet (23%) and regional and other markets (4%). Pro forma revenues (after completed divestitures) for the twelve months ended March 31, 2020 were approximately $2.9 billion. UA LOCAL 91: D&Z Defendants Dismissed from King Class Suit ---------------------------------------------------------- In the case, RONALD KING, et al., Plaintiffs, v. UA LOCAL 91, et al., Defendants, Case No. 2:19-CV-01115-KOB (N.D. Ala.), Judge Karon Owen Bowdre of the U.S. District Court for the Northern District of Alabama, Southern Division, granted the motion to dismiss filed by Defendants Day and Zimmermann, Inc. and Day and Zimmermann NPS, Inc. ("D&Z"). The employment-discrimination case comes before the court on D&Z's motion to dismiss the Amended Complaint. The Amended Complaint in the case alleges that D&Z and two other Defendants violated Title VII of the Civil Rights Act of 1964 by discriminating against five named Plaintiffs and a putative class of the Defendants' black employees. The instant motion asks the Court to both dismiss the Amended Complaint and decline to certify the Plaintiffs' proposed class. Defendant D&Z is a nationwide engineering, construction, and munitions company that also specializes in the general maintenance of power and industrial facilities, including nuclear and fossil electric generating plants. It operates on client property and conducts hires/layoffs of its employees for temporary periods of time which are usually tied directly to plant outages and shutdowns. D&Z is generally contractually obligated to hire Union members for "craft positions," such as pipefitters, welders, boilermakers, carpenters, and bricklayers. And it hires craftsmen for work on power plants in Alabama through referrals from the two Union Defendants in the case: United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada as well as its northern-Alabama affiliate, UA Local 91. The employment relationships between the Union-referred workers and D&Z is inherently temporary, as the contracts typically last several weeks or months. The five named Plaintiffs are journeymen pipefitters and welders who have been members of Defendant UA Local 91 for more than ten years; each has intermittently worked for D&Z on maintenance and construction sites on properties owned and operated by Southern Company (including its subsidiaries Alabama Power, Georgia Power, Mississippi Power, and Southern Power). The Plaintiffs obtained such positions with Day and Zimmermann and other contractors pursuant to the Defendant Unions' hiring hall relationships with the Southern Company and/or other companies who utilize the Defendant Unions' hiring hall referral system. All the five named Plaintiffs are black males. Although the Union Defendants referred -- and D&Z selected -- both leadership and laborer positions in ad hoc fashion for each job, the Plaintiffs allege that D&Z employed three selection criteria in filling leadership positions when the Union failed to nominate anyone: "prior experience," "leadership," and "absenteeism." They allege that over the last 10 years, the number of black foremen has been substantially disproportionate to the number of eligible applicants. They allege that black Union members were caught in a cycle of exclusion because the Defendants used two of the three criteria -- "prior experience" and "leadership" -- to perpetually refer and select members of a mostly white in-group. The Plaintiffs also allege that the Defendants created a culture of nepotism, as white Union members' family members often received positions over equally qualified black Union members. Two of the named Plaintiffs, Chris Samuel and Nolan Jones, also allege that the Defendants engaged in unlawful retaliation. Based on these alleged facts, the Plaintiffs bring the following three claims under Title VII: (I) disparate impact, (II) disparate treatment, and (III) retaliation. The Plaintiffs assert these claims on behalf of themselves and a putative class defined as follows: all current and former African American members of the United Association of Journeymen & Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada and/or its local union and affiliate, Local 91, during the limitations period applicable to this case, and all current and former African American pipefitters and welders employed by Day and Zimmermann during that same limitations period, including, without limitation, all current and former African American journeymen and apprentice pipefitters and welders. The Plaintiffs seek the following remedies for themselves, personally, and on behalf of the putative class: (1) a declaratory judgment that Defendants systemically discriminated against black persons by limiting their employment to inferior jobs; (2) a permanent injunction against continuing discrimination; (3) a restructuring of the Defendants' selection procedures so that African Americans are able to learn about and fairly compete in the future for better jobs traditionally enjoyed by white employees; (4) a restructuring of the Defendants' referral, recruitment and selection procedures to prevent further racial discrimination and disparate impact; (5) an Order restoring the named Plaintiffs and the class they seek to represent to the jobs they would now be occupying but for Defendants' discriminatory practices; (6) an Order requiring Defendants to initiate and implement systems of assigning, training, transferring, compensating, and promoting African American employees in a non-discriminatory manner; (7) an Order directing the Defendants to adjust the wages and benefits of the named Plaintiffs and the class they seek to represent to the level that they would now be enjoying but for the Defendants' discriminatory practices; (8) an Order requiring Defendants to initiate and implement programs that provide (i) equal employment opportunities for African American members and employees; (ii) remedy the effect of the Defendants' past and present unlawful employment practices; and (iii) eliminate the continuing effects of the discriminatory and retaliatory practices described; (9) an Order establishing a task force on equality and fairness to determine the effectiveness of the foregoing programs and remedies; and (10) damages, attorneys' fees, and costs. The Plaintiffs filed the operative Amended Complaint on Nov. 13, 2019. The two Union Defendants each filed answers to the Amended Complaint on Dec. 18, 2019. D&Z filed the instant motion to dismiss on Dec. 18, 2019, to which the Plaintiffs responded on Jan. 22, 2020 and D&Z replied on Jan. 29, 2020. Although the Parties discuss multiple issues in their briefing, the three central matters concern (a) whether the Amended Complaint is a shotgun pleading; (b) whether the pleadings and briefs regarding the instant motion provide the Court with sufficient information to consider class certification; and (c) whether the Amended Complaint plausibly alleges a certifiable class. D&Z brings the instant motion primarily under Federal Rule of Civil Procedure 12(b)(6). It contends that the Plaintiffs' class claims are legally insufficient because the Amended Complaint fails to plausibly allege the required elements of class claims under Federal Rule of Civil Procedure 23. In a footnote, D&Z also argues in the alternative that the court should strike or dismiss the Plaintiffs' class allegations under Federal Rules of Civil Procedure 12(f) or 23(d)(1)(D). Without expressly tying either Rule 12(f) or Rule 23(d)(1)(D) to the instant facts, the DZ Defendants submit that the result is the same: The Plaintiffs' class claims should not proceed past the Motion. Because not all the potential Plaintiffs, as described in the class definition, were or are associated with both groups of the Defendants; because not all claims apply to both groups of the Defendants; and because the Amended Complaint is vague as to which allegations apply to which Parties, Judge Bowdre will dismiss without prejudice as to D&Z only the Amended Complaint as an impermissible shotgun pleading. She agrees with D&Z that the Amended Complaint is an impermissible shotgun complaint because it features "vague," non-specific facts and levels multiple claims against multiple defendants without specifying which of the defendants are responsible for which acts or omissions. The Amended Complaint's lack of clarity pervades not only allegations supporting the Plaintiffs' disparate impact and disparate treatment claims (Counts I and II, respectively), but also their retaliation claim (Count III). As to the timing of the class certification, the relevant issue is whether the Plaintiffs have adequately alleged a certifiable class under Federal Rule of Civil Procedure 23. Because neither discovery nor an evidentiary hearing would help answer the question, the Judge finds that the issues are plain enough from the pleadings to address the matter of class certification pursuant to the instant motion to dismiss. Contrary to the Plaintiffs' assertions, D&Z does not contest any facts presented in the Amended Complaint. Nor did D&Z introduce any additional facts in its briefs supporting the instant motion to dismiss. The absence of contested facts in the case only further underscores the propriety of evaluating class certification at the motion to dismiss stage. Finally, D&Z's motion to dismiss contends that the Plaintiffs have failed to plausibly allege commonality, typicality and adequacy under Rule 23(a) and both alternatives under Rule 23(b). Because the Plaintiffs allege that D&Z supervisors engaged in a variety of discretionary, ad hoc, and subjective behaviors which provide no cause to believe that all their claims can productively be litigated at once, The Judge finds that neither the disparate impact nor disparate treatment claims are suitable for class certification under Fed. R. Civ. P. 23(a)(2). The Plaintiffs propose a single class while simultaneously seeking both injunctive/declaratory relief, such as an order restoring the named Plaintiffs and the class they seek to represent to the jobs they would now be occupying but for the Defendants' discriminatory practices, as well as back-pay (plus interest), punitive damages, and attorney's fees and costs and expenses. Regardless, the Plaintiffs' putative class fails under either Rule. The Judge finds that the Plaintiffs' alleged class, as pled, is not certifiable under Rule 23(b)(2), and tje Plaintiffs' proposed class fails to satisfy the predominance element of Federal Rule of Civil Procedure 23(b)(3) and is therefore uncertifiable. In light of the foregoing, because the Plaintiffs' Amended Complaint is an impermissible shotgun pleading and because the Plaintiffs' class claims fail to satisfy Federal Rules of Civil Procedure 23(a) and 23(b), Judge Bowdre granted D&Z's motion to dismiss, and dismissed the Plaintiffs' entire Amended Complaint, as to D&Z, without prejudice. The Judge struck the Plaintiffs' class claims. The Plaintiffs' Amended Complaint remains operative as to the Union Defendants. The Judge will enter a separate order accompanying her memorandum opinion. A full-text copy of the Court's July 15, 2020 Memorandum Opinion is available at https://is.gd/88PNva from Leagle.com. UNIVERSAL TOWERS: U.S. Trustee Unable to Appoint Committee ---------------------------------------------------------- The U.S. Trustee, until further notice, will not appoint an official committee of unsecured creditors in the Chapter 11 case of Universal Towers Construction, according to court dockets. About Universal Towers Construction Universal Towers Construction, Inc., a privately held company in the traveler accommodation industry, filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-03799) on July 3, 2020. Universal Towers President Lis R. Oliveira-Sommerville signed the petition. Judge Karen S. Jennemann oversees the case. At the time of the filing, Debtor etimated $10 million to $50 million in both assets and liabilities. The Debtor has tapped Burr & Forman LLP as its legal counsel and Withumsmith+Brown, PC, as its accountant and financial advisor. VERITAS BERMUDA: Moody's Affirms B3 CFR, Outlook Stable ------------------------------------------------------- Moody's Investors Service affirmed Veritas Bermuda Ltd.'s ratings including its B3 Corporate Family Rating. The company is refinancing its existing senior secured term loans with a combination of new senior secured term loans and other senior secured debt. Moody's assigned B2 ratings to the new secured term loans, the same as the existing term loan ratings. The affirmation reflects the strong cash generating potential, improving margins and strong cash balances despite continued declines in revenues. The outlook is stable. RATINGS RATIONALE Veritas's B3 CFR is driven by its high leverage, declining revenues and challenges from an evolving storage software market. Leverage as of April 3, 2020 is estimated around 6x pro forma for run rate cost savings and excluding certain restructuring costs, but around 8x before those addbacks. Though Moody's expects declining revenue trends, cost reductions, should drive actual leverage to improve modestly but remain elevated. The high leverage is offset to some degree by large cash balances (estimated $568 million at closing of the transaction). The ratings also consider Veritas's leading market position as a provider of backup and recovery software and its entrenched position within enterprise customers' critical IT infrastructure. However, the storage management software market is shifting, and solutions provided by new entrants and new technologies may erode Veritas's leading market position over time. Moody's expects revenues in Veritas's core NetBackup and appliance product lines (around 61% of revenues) to continue to face competitive headwinds from the shift of workloads to the cloud, but remain relatively stable, while its remaining lines continue to decline, resulting in overall mid-single digit revenue declines over the next 12 -18 months. Veritas is owned by investment funds of private equity firm, The Carlyle Group and does not have an independent board of directors. Though financial policies will likely remain aggressive as evidenced by the high leverage, Carlyle has left substantial cash balances at the company while attempting to turn around revenue declines. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects Moody's expectation for moderate declines in revenue offset to some degree by cost improvements over the next 18 months. The ratings could be upgraded if performance stabilizes, leverage is on track to fall below 6.5x and free cash flow to debt is on track to exceed 5%. The ratings could be downgraded if leverage is expected to exceed 8x for an extended period or free cash flow is expected to be negative (with some cushion while cash balances remain strong). Liquidity is good with an estimated $568 million of cash as of closing and an undrawn $250 million revolving credit facility. Free cash flow is expected to be positive over the next 12 months. Assignments: Issuer: Veritas Bermuda Ltd. Senior Secured Bank Credit Facility, Assigned B2 (LGD3) Affirmations: Issuer: Veritas Bermuda Ltd. Corporate Family Rating, Affirmed B3 Probability of Default Rating, Affirmed B3-PD Senior Secured Bank Credit Facility, Affirmed B2 (LGD3) Senior Secured Regular Bond/Debenture, Affirmed B2 (LGD3) Senior Unsecured Regular Bond/Debenture, Affirmed Caa2 (LGD6) Outlook Actions: Issuer: Veritas Bermuda Ltd. Outlook, Remains Stable The principal methodology used in these ratings was Software Industry published in August 2018. Veritas Bermuda Ltd., headquartered in Santa Clara, California is a provider of storage management, and backup and recovery software. Veritas is owned by investment funds of the private equity firm, The Carlyle Group. Veritas generated approximately $2 billion of revenue in the LTM period ended April 3, 2020. VIVUS INC: Appointment of Equity Committee Sought ------------------------------------------------- An equity holder of Vivus, Inc. asked the U.S. Bankruptcy Court for the District of Delaware to issue an order directing the appointment of a committee of equity holders in the Chapter 11 cases of the company and its affiliates. Steven Chlavin, holder of approximately 5.5 percent of the equity interests in Vivus, said equity holders are the only stakeholders that stand to lose anything under the companies' joint prepackaged Chapter 11 plan of reorganization. "They were not represented in the negotiations that ultimately resulted in the proposed plan," Mr. Chlavin said in court papers. "In the absence of an official committee, equity will not be adequately represented now and through the confirmation process, given the complexity of these cases," he further said. Mr. Chlavin said there is likelihood that equity is "in the money," pointing out that the public record and the companies' own statements to investors "show an enterprise that is ready to spring into profitability." Mr. Chlavin is represented by: John D. Demmy, Esq. Lucian Murley, Esq. Saul Ewing Arnstein & Lehr LLP 1201 N. Market Street , Suite 2300 P.O. Box 1266 Wilmington, DE 19899 Phone: 302-421-6898 Email: john.demmy@saul.com luke.murley@saul.com About Vivus Inc Vivus Inc is a biopharmaceutical company committed to the development and commercialization of innovative therapies that focus on advancing treatments for patients with serious unmet medical needs. It was incorporated in 1991 in California and reincorporated in 1996 in Delaware. As of the petition date, Vivus is a publicly traded company with its shares listed on the Nasdaq Global Market LLC under the ticker symbol "VVUS." Vivus maintains its headquarters in Campbell, Calif. Visit https://www.vivus.com for more information. Vivus and three of its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 20-11779) on July 7, 2020. The petitions were signed by Mark Oki, chief financial officer. Judge Laurie Selber Silverstein presides over the cases. As of May 31, 2020, Debtors reported total assets of $213,884,000 and total liabilities of $281,669,000. The Debtors tapped Weil Gotshal & Manges LP as their general bankruptcy counsel, Richards, Layton & Finger P.A. as local counsel, Ernst & Young as financial advisor, and Piper Sandler Companies as investment banker. Stretto is the claims and noticing agent. VTV THERAPEUTICS: Incurs $3.37 Million Net Loss in Second Quarter ----------------------------------------------------------------- vTv Therapeutics Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, disclosing a net loss attributable to the company of $3.37 million on $0 of revenue for the three months ended June 30, 2020, compared to a net loss attributable to the company of $2.88 million on $1.83 million of revenue for the three months ended June 30, 2019. For the six months ended June 30, 2020, the Company reported a net loss attributable to the company of $8.09 million on $8,000 of revenue compared to a net loss attributable to the company of $5.04 million on $2.75 million of revenue for the same period during the prior year. As of June 30, 2020, the Company had $10.63 million in total assets, $16.78 million in total liabilities, $63.38 million in redeemable noncontrolling interest, and a total stockholders' deficit attributable to the company of $69.53 million. "Building on the successful phase 2 study completed earlier this year with TTP399, we have been highly focused on advancing this promising candidate as an adjunct to insulin for type 1 diabetes into the next stage of clinical development," said Steve Holcombe, president and CEO. "To this end, we have been engaging with the FDA to determine the development path for TTP399 and are in the planning stages for our first pivotal study, which we anticipate commencing by the end of 2020. We have also continued to enroll patients in our phase 2 study of azeliragon for the treatment of Alzheimer's disease in patients with type 2 diabetes, despite the clinical challenges posed by COVID-19." Research and development expenses were $2.5 million and $4.2 million for the three months ended June 30, 2020 and March 31, 2020, respectively. This decrease of $1.7 million was driven primarily by a decrease of $0.5 million related to the development of TTP399, as the Simplici-T1 Study was completed in early 2020. Further, costs related to the development of azeliragon decreased approximately $0.8 million related to lower costs incurred for the Elevage Study due to a slowdown in enrollment caused, in part, by COVID-19. General and administrative expenses were $1.7 million for the second quarter of 2020 and $2.5 million for the first quarter, respectively. The decrease of $0.8 million was driven by lower professional fees, an adjustment made to the Company's asset retirement obligation recorded in connection with a leased facility, and overall expense curtailment. As of June 30, 2020, the Company's liquidity sources included cash and cash equivalents of $6.4 million and $3.0 million of remaining funds available under the Letter Agreements. Further, the Company has remaining availability of $5.4 million under its Controlled Equity OfferingSM Sales Agreement with Cantor Fitzgerald & Co. pursuant to which the Company may offer and sell, from time to time shares of the Company's Class A Common Stock. On July 29, 2020, the Company amended the Loan Agreement to further modify the payment terms and to remove the minimum cash requirements under this agreement. Based on the Company's current operating plan, management believes that its current cash and cash equivalents, the remaining funds available under the Letter Agreements and the ATM Offering, if fully utilized will allow the Company to meet its liquidity requirements through September 2020, which is less than twelve months from the issuance of these Condensed Consolidated Financial Statements. The Company said these conditions raise substantial doubt about its ability to continue as a going concern. The Company is evaluating several financing strategies to provide continued funding which may include additional direct equity investments or future public offerings of our common stock. The timing and availability of such financing is not yet known. A full-text copy of the Form 10-Q is available for free at: https://is.gd/U7D5FN About vTv Therapeutics vTv Therapeutics Inc. is a clinical-stage biopharmaceutical company focused on developing oral small molecule drug candidates. vTv has a pipeline of clinical drug candidates led by programs for the treatment of type 1 diabetes, Alzheimer's disease, and inflammatory disorders. vTv's development partners are pursuing additional indications in type 2 diabetes, chronic obstructive pulmonary disease (COPD), and genetic mitochondrial diseases. vTv Therapeutics reported a net loss attributable to common shareholders of $17.91 million for the year ended Dec. 31, 2019 compared to a net loss attributable to common shareholders of $8.65 million for the year ended Dec. 31, 2018. As of March 31, 2020, the Company had $7.39 million in total assets, $17.01 million in total liabilities, $52.19 million in redeemable noncontrolling interest, and a total stockholders' deficit attributable to the company of $61.82 million. Ernst & Young LLP, in Raleigh, North Carolina, the Company's auditor since 2000, issued a "going concern" qualification in its report dated Feb. 20, 2020 citing that to date, the Company has not generated any product revenue, has not achieved profitable operations, has insufficient liquidity to sustain operations and has stated that substantial doubt exists about the Company's ability to continue as a going concern. WC 4TH AND COLORADO: Case Summary & 15 Unsecured Creditors ---------------------------------------------------------- Debtor: WC 4th and Colorado, LP 814 Lavaca Street Austin, TX 78701 Business Description: WC 4th and Colorado, LP is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: August 4, 2020 Court: United States Bankruptcy Court Western District of Texas Case No.: 20-10881 Debtor's Counsel: Mark Ralston, Esq. Estimated Assets: $10 million to $50 million Estimated Liabilities: $1 million to $10 million The petition was signed by Brian Elliot, authorized agent. A copy of the petition is available for free at PacerMonitor.com at: https://is.gd/VvByrc List of Debtor's 15 Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Third Colorado Street, LLC - 500 W 2nd Street, Suite 1900 Austin, Texas 78701 2. Kone Elevators $23,020 PO Box 894156 Los Angeles, CA 90189-4156 3. KONE, Inc. $14,295 5101 E St. Elmo #315 Austin, TX 78744 4. Heads up Cleaning Services $2,581 PO Box 293 Lockhart, TX 78644 5. Will's All Pro Plumbing and Air $2,165 7847 Fortune Drive San Antonio, TX 78250 6. Clarke Kent Plumbing, Inc. $1,324 1408 W. Ben White Blvd. Austin, TX 78704 7. Vanguard Fire Sytems, LP $811 2340 Patterson Industrial Dr Pflugerville, TX 78660 8. Inoca Holdco II LLC $770 FCS Fox Commercial Services, LLC PO Box 19047 Austin, TX 78760 9. Facility Solutions Group, Inc. $578 PO Box 896808 Charlotte, NC 28289-6508 10. ABC Home and Commercial Services $481 9475 E Highway 290 Austin, TX 78724-2303 11. Arnold & Placek, P.C. $425 203 E. Main Street, Suite 201 Round Rock, TX 78664 12. LPZ Electric LLC $312 1533 N Interstate 35, Suite #6 Pflugerville, TX 78660 13. Beckett Electrical Services, LLC $240 PO Box 81381 Austin, TX 78708 14. The Lost Lei/DW Hospitality, LLC Unknown 2918 Bellamy Circle Cedar Park, TX 78613 15. JAC Entertainment, LLC $92,153 8114 B Baywood Austin, Texas 78759 XEROX CORP: Fitch Alters Outlook on BB LongTerm IDR to Negative --------------------------------------------------------------- Fitch Ratings has affirmed Xerox Corporation and Xerox Holding Corporation's 'BB' Long-Term Issuer Default Ratings and senior unsecured debt ratings at 'BB'/'RR4'. The Rating Outlook has been revised to Negative from Stable. Its rating actions follow Xerox's 2Q'20 earnings results. Xerox's revenue declined 35% y/y as a result of significant shut-ins due to the coronavirus pandemic. While equipment sales, which fell 38%, may recover as pushed out demand is ultimately fulfilled, lost post sale revenue, which declined 34%, will likely not be recovered. Moreover, print is susceptible to a permanent change in worker habits that have adopted digital methods as a result of remote work, if and when workers fully return to offices. Xerox's own survey of 600 organizations said 80% of their workforces will have returned to the workplace in a year to a year-and-a-half on average, suggesting even if workplace habits don't change materially, Xerox's business could be pressured over at least the intermediate term. Xerox's business has also been challenged for the better part of the last decade, experiencing a 27% decline in revenue over 2014 through the LTM period ending June 30, 2020. Fitch sees this worsening to 47% through year-end and do not believe Xerox's revenue will exceed $7 billion organically over the rating horizon. Despite these uncertainties, Xerox has indicated it will resume share repurchases in 2H'20, buying back at least $300 million on top of about $250 million of common and preferred dividends versus generation of $165 million of pre-dividend FCF in 1H. For the full year Fitch sees Xerox generating about $200 million in pre-dividend FCF before backing out the source from declines in finance receivables. A recently announced issuance partially addresses refinancing risk associated with the $1.8 billion in maturities Xerox faces through May 2021, which had been a material near-term concern. Xerox relied on a secured borrowing to refinance its $313 million May maturity and until now had been absent from new issuance markets. Xerox thus far has signaled it will not use proceeds from its $2.2 billion sale of its interest in Fuji Xerox to repay borrowings. KEY RATING DRIVERS Longer-Term Impact on Business Uncertain: Xerox's core business may not recover from the coronavirus pandemic. Revenue has averaged a 6% constant currency decline over the past two and a half years before plunging 35% in the second quarter. Optimistically assuming a moderation in declines in 2H'20, Xerox's revenue will have shrunk nearly $6 billion since 2014 or almost 50%. Pre-crisis traditional office print in many of Xerox's geographies was expected to be flat at best. With a more distributed workforce and a step-change shift to digital work practices brought about by the coronavirus, Xerox may not see its revenue exceed $7 billion organically over the rating horizon. Refinancing Risk: Recently announced issuance addresses part of Xerox's $1.8 billion in maturities over the next nine and a half months. Xerox previously elected to enter into a secured loan backed by receivables to refinance its May $313 million maturity that it initially paid off with cash. Xerox continues to assert its core debt levels remain within an investment grade credit metrics. However, Fitch sees total gross leverage exceeding 6x this year and close to 4x on a core basis. Additionally, Fitch expects post-dividend FCF to be negative for the year (both before and after accounting for the reduction in Xerox's receivables) and neutral in 2021. Shareholder Return: Instead of preserving liquidity in the face of increased uncertainty, Xerox said it plans to buy back at least $300 million in stock in 2H'20. Fitch does not see the company generating the nearly $550 million in FCF to cover its dividend, share repurchases and preferred dividend for the year. Xerox's willingness to fund shareholder return effectively through its secured debt refinancing, finance receivable run down and cash on hand suggests the company will continue to prioritize this going forward. Fitch believes in the absence of further strategic actions, the company will buy back another $1.5 billion in stock over the next three years, at least partially debt financed. Strategic Actions: Xerox's core business uncertainty will likely prompt it to pursue further strategic actions that are unlikely to be creditor friendly. The company has converted to a holding company structure without providing explicit protections to existing bondholders. Xerox has previously floated the idea of selling its leasing business without a commitment to reducing associated financing debt (which it carries at 7:1 while Fitch assesses at 3:1). Additionally, it pursued a $35 billion hostile takeover of HP, Inc. that was scuttled due to the coronavirus. Given top line pressures and questions over the long-term sustainability of the core business, Xerox will likely be pressured to pursue similar if not some of the same actions again. ESG - Governance: Xerox has an ESG Relevance Score of 4 for Management Strategy due to the company's shift to a more aggressive financial policy and inability to address core revenue declines, and has a negative impact on the credit profile and is relevant to the rating in conjunction with other factors. Xerox has an ESG Relevance Score of 4 for Governance Structure due to the board representation weighted towards activist shareholders, and has a negative impact on the credit profile, and is relevant to the rating in conjunction with other factors. Xerox has an ESG Relevance Score of 4 for Group Structure due to the imposition of a holding structure that could be detrimental to unsecured creditors, and has a negative impact on the credit profile, and is relevant to the rating in conjunction with other factors. DERIVATION SUMMARY Xerox is among the larger print technology companies with a leading share in the A3 MFP space. According to IDC, Xerox's closest peer, HP Inc. (BBB+/Negative) held the number one worldwide hardcopy peripherals market share, based on units. Xerox's margin is higher than HP's, which derives more than 60% of its revenue from its lower margin PC business, although this business has proven to be a meaningful positive offset during the coronavirus pandemics. HP's printer business is more than twice the size of Xerox's on a revenue basis, while Xerox's operating EBITDA margin is the same as HP's when comparing the companies' most recent results on an LTM basis. HP has a much more significant share in A4 but through acquisitions has increased its A3 market share materially. HP does not have a customer leasing business. Xerox's core business has been in decline for several years, and recent product refreshes were not successful at turning around mid-single-digit declines in its post-sale business, which represents more than three quarters of revenue. Fitch expects Xerox to continue to experience negative revenue growth over the ratings horizon with only diminished prospects for modest improvement, confirmed in part by recent results. Additionally, Xerox has continued its retreat from previously conservative financial policies through sizable share repurchases. While Xerox's liquidity position at present is adequate and the company previously took steps to improve its balance sheet, a continued deterioration in Xerox's market position associated with lack of a turnaround in its core business bears risk to the company's operational position and prospective financial position as a result over the rating horizon. KEY ASSUMPTIONS Fitch's Key Assumptions Within its Rating Case for the Issuer -- Double digit revenue declines in 3Q'20 and 4Q'20 approximately 10 points better than 2Q'20 with gradual improvement as workers increasingly return to offices with total revenue of $6.8 billion; modest, single digit growth in 2021, slightly down in 2022 and lower single digit decline in 2023 -- 3Q'20 operating EBITDA margin of approximately 10%, improving to higher teens in 4Q'20 owing to seasonality and cost actions; expect 3-4 points of margin improvement in 2021 and about 2 points in 2022; -- Approximately $400 million reduction in finance assets total, net over 2020, an additional $200 million to $300 million in 2021 and roughly constant thereafter; -- $100 million of capex annually, maintenance of existing dividend and assumed $100 million tuck-in acquisitions annually beyond 2020; -- Allocation of bulk of post-dividend FCF beyond tuck-in acquisitions to share repurchases; assume $300 million in 2H'20 and $1.5 billion over 2021-2023, at least partially debt financed; -- Use of revolver borrowings to refinance upcoming maturities with potential for additional secured borrowings. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Improving constant currency revenue growth approaching flat to neutral; -- Total debt with equity credit to operating EBITDA (excluding financing debt by Fitch's calculation; "core leverage") sustained below 2x; -- Recommitment to a more conservative financial policy. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Organic, constant currency revenue declines greater than mid-single digits; -- Core leverage sustained above 3x; -- FCF adjusted for the change in financing assets sustained below low single digits as a percentage of revenue; -- Shift to a more aggressive financial policy. 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: Xerox had $2.3 billion of cash and cash equivalents at June 30, 2020, including $42 million of restricted cash. The company's cash balance is elevated following its November sale of is interest in Fuji Xerox for approximately $2.2 billion. Xerox maintains access to its $1.8 billion revolving credit facility, which was undrawn at June 30, 2020. The credit facility allows the company to increase, with the consent of its lenders, the overall size of the facility by $750 million. Xerox also has the right to request a one-year extension with the facility which matures in August 2022. Fitch anticipates that Xerox will utilize the majority of its FCF to repurchase stock or make acquisitions as opposed to reducing its debt. Debt Structure: Xerox faces a staggered but sizable maturity ladder over the ratings horizon. $1.8 billion of aggregate principal outstanding bonds mature over through May 2021, although its announced issuance is expected to refinance its August and September maturities totaling $738 million. Fitch assumes Xerox will refinance later maturities as they come due predicated on the company stabilizing its operational profile and maintaining sufficient market access. 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 Xerox Corporation: Management Strategy: 4, Group Structure: 4, Governance Structure: 4 Except for the matters discussed, 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, either due to their nature or to the way in which they are being managed by the entity. YRC WORLDWIDE: Incurs $37.1 Million Net Loss in Second Quarter -------------------------------------------------------------- YRC Worldwide Inc. filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q, disclosing a net loss of $37.1 million on $1.01 billion of operating revenue for the three months ended June 30, 2020, compared to a net loss of $23.6 million on $1.27 billion of operating revenue for the three months ended June 30, 2019. For the six months ended June 30, 2020, the Company reported a net loss of $32.8 million on $2.16 billion of operating revenue compared to a net loss of $72.7 million on $2.45 billion of operating revenue for the same period during the prior year. As of June 30, 2020, the Company had $1.93 billion in total assets, $802.3 million in total current liabilities, $871.1 million in long-term debt and financing (less current portion), $225.9 million in pension and postretirement, $214 million in operating lease liabilities, $290.2 million in claims and other liabilities, and a total shareholders' deficit of $466.9 million. On July 7th, the Company successfully secured a loan with the United States Department of Treasury for up to $700 million under the CARES Act. The significant terms of which are as follows: * Tranche A of up to $300 million to satisfy previously deferred short-term contractual obligations such as healthcare payments and some lease obligations with the remaining amount going to fund an increase in liquidity. * Tranche B of up to $400 million to reinvest back into the business via purchases of tractors and trailers. * The UST Loan is non-amortizing, bears an interest rate of the Eurodollar (floor of 1.0%) + 3.5% and matures in September 2024. The Company issued UST approximately 30% of its outstanding shares on a post-transaction basis as a condition of the financing. In addition to the securing the UST Loan, the Company amended its existing term loan to, among other things, eliminate its Adjusted EBITDA covenant until Dec. 31, 2021, at which time the covenant will require at least $100 million of LTM Adjusted EBITDA, and the covenant will incrementally increase to a requirement of at least $200 million LTM Adjusted EBITDA on June 30, 2022. The company was also able to decrease the amended interest rate on the existing term loan down to the previous LIBOR + 7.5% (with a floor of 1.0%). As a condition of the aforementioned amendments, the Company agreed to a minimum "Liquidity" requirement of $125 million. Finally, the Company was also able to significantly extend the maturity on its Asset Based Loan from June 2021 to January 2024. "It is a new day at YRC Worldwide," said Darren Hawkins, chief executive officer. "During this pandemic and historically difficult economic backdrop, we were able to secure financing that not only took care of our employees' healthcare coverage but also will allow us to significantly upgrade the condition, age and efficiency of our rolling stock. We were also able to gain additional covenant relief and maturity extension of our other substantive debt instruments simultaneously," said Darren Hawkins, chief executive officer. "On an operational basis, for the quarter, volumes declined year-over-year. However, after bottoming out in April, volumes have steadily improved through the quarter with rate of improvement slowing since late June. I would like to say the worst is behind us, but this virus and the spread thereof is too unpredictable. To that end, when we started to feel the impact of the economic slow down and subsequent decline in our volumes, we took immediate and swift action to build liquidity which allowed us to improve our cash position and end the quarter to just over $300 million in liquidity." "With the UST Loan secured and our largest maturities pushed out to 2024, we now have the unique ability to focus on and accelerate our Enterprise Transformation strategy that we began implementing last year. Our goal is to improve our customers' experience while operating as one company, with one network and five incredibly proud and distinguished brands, Hawkins continued. "In closing, I want to thank all of YRC's employees across North America who continue to perform essential work to keep America rolling and the nation's supply chain open during these challenging times. We continue to prioritize the health and safety of our employees above all while focusing on exceeding our customers' expectations every single day on every single shipment," concluded Hawkins. Second Quarter 2020 Financial Update * Revenue decreased by $257.2 million to $1.015 billion compared to revenue of $1.273 billion in second quarter of 2019. * Net loss increased by $13.5 million to $37.1 million compared to a net loss of $23.6 million in second quarter 2019. * On a non-GAAP basis, the Company generated consolidated Adjusted EBITDA of $37.9 million, a $29.4 million decrease compared to $67.3 million in the prior year comparable quarter (as detailed in the reconciliation below). Last twelve month (LTM) consolidated Adjusted EBITDA was $183.1 million compared to $259.1 million in 2019. Second Quarter 2020 Operational Update * LTL revenue per hundredweight including fuel surcharge decreased 5.7%; however, weight per shipment increased 1.4% resulting in a LTL revenue per shipment decrease of 4.4% when compared to the same period in 2019. Excluding fuel surcharge, LTL revenue per hundredweight was down 2.6% and LTL revenue per shipment was down 1.2%. * LTL tonnage per day decreased 14.8% when compared to 2Q19. * The consolidated operating ratio for the quarter was 100.5 compared to 98.9 in 2Q19. Liquidity Update (as of June 30, 2020) * The Company's outstanding debt was $909.8 million, an increase of $44.8 million compared to $865.0 million as of June 30, 2019. * For the six months ended June 30, 2020, cash provided by operating activities was $213.6 million compared to cash used of $29.5 million for the six months ended June 30, 2019. * The Company's available liquidity as calculated under its credit facilities in place before July 7, 2020, which was comprised of cash and cash equivalents and Managed Accessibility under its ABL facility, was $302.6 million. A full-text copy of the Form 10-Q is available for free at: https://is.gd/zNFNeq About YRC Worldwide YRC Worldwide Inc., headquartered in Overland Park, Kan., is a holding company for a portfolio of less-than-truckload (LTL) companies including Holland, New Penn, Reddaway, and YRC Freight, as well as the logistics company HNRY Logistics. YRC Worldwide companies -- http://www.yrcw.com-- offer expertise in flexible supply chain solutions, ensuring customers can ship industrial, commercial and retail goods with confidence. YRC Worldwide reported a net loss of $104 million for the year ended Dec. 31, 2019. As of March 31, 2020, the Company had $1.85 billion in total assets, $704.5 million in total current liabilities, $838.3 million in long-term debt and financing, less current portion, $230.5 million in pension and post-retirement, $223 million in operating lease liabilities, $290.5 million in claims and other liabilities, and a total shareholders' deficit of $433.8 million. * * * As reported by the TCR on July 14, 2020, S&P Global Ratings raised its issuer credit rating on Overland Park, Kan.-based less-than-truckload (LTL) and logistics company YRC Worldwide Inc. to 'CCC+' from 'CCC' after the company announced the U.S. Department of the Treasury will lend it an aggregate of $700 million under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and that it has amended its term loan agreement to waive the minimum EBITDA covenant through December 2021. In July 2020, Moody's Investors Service confirmed the ratings of truck carrier YRC Worldwide Inc., including the Caa1 corporate family rating, 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 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. [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re SSA Retail Management LLC Bankr. N.D. Tex. Case No. 20-32025 Chapter 11 Petition filed July 29, 2020 See https://is.gd/IKLC3e represented by: Melissa S. Hayward, Esq. HAYWARD & ASSOCIATES PLLC E-mail: mhayward@haywardfirm.com In re Shale Farms, LLC Bankr. E.D. Tenn. Case No. 20-31787 Chapter 11 Petition filed July 29, 2020 See https://is.gd/Tvl0zx represented by: James R. Moore, Esq. MOORE & BROOKS E-mail: jmoore@moore-brooks.com In re Kang Family Entertainment, Inc. Bankr. S.D. Fla. Case No. 20-18190 Chapter 11 Petition filed July 29, 2020 See https://is.gd/yGe3v3 represented by: Chad Van Horn, Esq. VAN HORN LAW GROUP, P.A. E-mail: chad@cvhlawgroup.com In re Ohio City Nails Inc Bankr. N.D. Ohio Case No. 20-13542 Chapter 11 Petition filed July 29, 2020 See https://is.gd/5UIkl8 represented by: Donald Butler, Esq. DONALD BUTLER, ESQ. E-mail: butdon@aol.com In re Sarabjeet Kaur Bankr. N.D. Tex. Case No. 20-32026 Chapter 11 Petition filed July 29, 2020 represented by: Melissa Hayward, Esq. In re Claire E. Gruppo Bankr. S.D.N.Y. Case No. 20-35797 Chapter 11 Petition filed July 29, 2020 represented by: Michelle Trier, Esq. GENOVA & MALIN In re Cody Boyd Aull Bankr. S.D. Miss. Case No. 20-02076 Chapter 11 Petition filed July 29, 2020 represented by: Douglas Engell, Esq. In re Lightsteel Technologies, Inc. Bankr. M.D. Ala. Case No. 20-31705 Chapter 11 Petition filed July 31, 2020 See https://is.gd/Cv7fnL Filed Pro Se In re Premium Health At Home, Inc. Bankr. D. Wyo. Case No. 20-20378 Chapter 11 Petition filed July 31, 2020 See https://is.gd/5G4Vdr represented by: Clark D. Stith, Esq. CLARK D. STITH E-mail: clarkstith@wyolawyers.com In re Enterprise Janitorial Inc. Bankr. D. Nev. Case No. 20-50740 Chapter 11 Petition filed July 30, 2020 See https://is.gd/S5aoZu represented by: Kevin A. Darby, Esq. DARBY LAW PRACTICE E-mail: kevin@darbylawpractice.com In re Progressive Spine and Sports Medicine, LLC Bankr. D.N.J. Case No. 20-19043 Chapter 11 Petition filed July 30, 2020 See https://is.gd/plvgEw represented by: David L. Stevens, Esq. SCURA, WIGFIELD, HEYER, STEVENS & CAMMAROTA, LLP E-mail: ecfbkfilings@scuramealey.com In re Premium Health At Home, LLC Bankr. D. Wyo. Case No. 20-20374 Chapter 11 Petition filed July 30, 2020 See https://is.gd/ACI7T6 represented by: Clark D. Stith, Esq. CLARK D. STITH E-mail: clarkstith@wyolawyers.com In re Northgrand Estates, LLC Bankr. E.D. Cal. Case No. 20-12496 Chapter 11 Petition filed July 29, 2020 See https://is.gd/1GcRnZ represented by: Michael R. Totaro, Esq. TOTARO & SHANAHAN E-mail: Ocbkatty@aol.com In re LG Ornamentals, LLC Bankr. M.D. Tenn. Case No. 20-03560 Chapter 11 Petition filed July 29, 2020 See https://is.gd/kvcXcX represented by: Steven L. Lefkovitz, Esq. LEFKOVITZ & LEFKOVITZ E-mail: slefkovitz@lefkovitz.com In re Livingscapes, LLC Bankr. M.D. Tenn. Case No. 20-03561 Chapter 11 Petition filed July 29, 2020 See https://is.gd/niw7Os represented by: Steven L. Lefkovitz, Esq. LEFKOVITZ & LEFKOVITZ E-mail: slefkovitz@lefkovitz.com In re Robbin's Nest for Children LLC Bankr. S.D. Tex. Case No. 20-33824 Chapter 11 Petition filed July 31, 2020 See https://is.gd/ozB2GP represented by: Margaret M. McClure, Esq. LAW OFFICE OF MARGARET M. MCCLURE E-mail: margaret@mmmcclurelaw.com In re Brasserie Felix Inc. Bankr. E.D.N.Y. Case No. 20-42824 Chapter 11 Petition filed July 31, 2020 See https://is.gd/vT4Qw0 represented by: Lawrence F. Morrison, Esq. MORRISON TENENBAUM, PLLC E-mail: info@m-t-law.com In re Scott & Mike, LLC Bankr. W.D. Pa. Case No. 20-22272 Chapter 11 Petition filed July 31, 2020 See https://is.gd/kDtKBL represented by: Donald R. Calaiaro, Esq. CALAIARO VALENCIK E-mail: dcalaiaro@c-vlaw.com In re Massage Magic Inc Bankr. W.D. Wash. Case No. 20-12060 Chapter 11 Petition filed July 31, 2020 See https://is.gd/7ZfY81 Filed Pro Se In re Ana L. Arroyo Bankr. D. Nev. Case No. 20-50747 Chapter 11 Petition filed July 31, 2020 represented by: Kevin A. Darby, Esq. DARBY LAW PRACTICE, LTD. Email: kad@darbylawpractice.com In re Amie Teague Boone Bankr. W.D. Va. Case No. 20-61106 Chapter 11 Petition filed July 31, 2020 represented by: Andrew S. Goldstein, Esq. MAGEE GOLDSTEIN LASKY & SAYERS, P.C. E-mail: agoldstein@mglspc.com In re Carlos Moreno Bankr. N.D. Tex. Case No. 20-32064 Chapter 11 Petition filed July 31, 2020 represented by: Areya Holder, Esq. HOLDER LAW In re Glen Scott Short Bankr. S.D. Ind. Case No. 20-90851 Chapter 11 Petition filed July 31, 2020 represented by: David Krebs, Esq. In re Jerry Lee Hartley Bankr. D.S.C. Case No. 20-03113 Chapter 11 Petition filed July 31, 2020 represented by: Reid Smith, Esq. In re Ben Het, LLC Bankr. N.D. Ga. Case No. 20-68632 Chapter 11 Petition filed August 3, 2020 In re Jake Trucking and Logging, LLC Bankr. E.D. Ky. Case No. 20-70372 Chapter 11 Petition filed August 3, 2020 See https://is.gd/fOauKt represented by: Noah Friend, Esq. NOAH R FRIEND LAW FIRM E-mail: noah@friendlawfirm.com In re GB Holdings of Georgia Inc. Bankr. N.D. Ga. Case No. 20-68647 Chapter 11 Petition filed August 3, 2020 See https://is.gd/DzxFXB represented by: Kenneth Mitchell, Esq. GIDDENS, MITCHELL & ASSOCIATES P.C. E-mail: GMAPCLAW1@GMAIL.COM In re Carson Creek Ranch Parking, LLC Bankr. W.D. Tex. Case No. 20-10876 Chapter 11 Petition filed August 3, 2020 See https://is.gd/9qiNqu represented by: Todd Headden, Esq. HAJJAR PETERS LLP E-mail: theadden@legalstrategy.com In re Galiciapoke LLC Bankr. M.D. Fla. Case No. 20-04381 Chapter 11 Petition filed August 3, 2020 See https://is.gd/CIMOdS represented by: Jeffrey S. Ainsworth, Esq. BRANSONLAW, PLLC E-mail: jeff@bransonlaw.com In re GaliciaFLPoke LLC Bankr. M.D. Fla. Case No. 20-04382 Chapter 11 Petition filed August 3, 2020 See https://is.gd/0R3MYw represented by: Jeffrey S. Ainsworth, Esq. BRANSONLAW, PLLC E-mail: jeff@bransonlaw.com In re Monarch Group LLC Bankr. E.D. Tex. Case No. 20-41708 Chapter 11 Petition filed August 3, 2020 See https://is.gd/4WySpP represented by: Melissa S. Hayward, Esq. HAYWARD & ASSOCIATES PLLC E-mail: mhayward@haywardfirm.com In re Lafayette Auto Sales, Inc Bankr. D.N.J. Case No. 20-19225 Chapter 11 Petition filed August 2, 2020 See https://is.gd/GFQADS represented by: David L. Stevens, Esq. SCURA, WIGFIELD, HEYER, STEVENS & CAMMAROTA, LLP E-mail: ecfbkfilings@scuramealey.com In re Kevin & Susan Thurmon Bankr. W.D. Mo. Case No. 20-41400 Chapter 11 Petition filed August 3, 2020 represented by: Bradley D. McCormack, Esq. Michael J. Wambolt, Esq. THE SADER LAW FIRM Email: bmccormack@saderlawfirm.com mwambolt@saderlawfirm.com In re Maximo R. Saenz Bankr. S.D. Tex. Case No. 20-70232 Chapter 11 Petition filed August 3, 2020 represented by: John Stephen, Esq. In re Lisa Marie Holley Bankr. E.D. Tex. Case No. 20-41706 Chapter 11 Petition filed August 3, 2020 represented by: Gary G. Lyon, Esq. BAILEY AND LYON, ATTORNEYS AT LAW E-mail: glyon.attorney@gmail.com In re Anne Amelia Hedge Bankr. E.D. Tex. Case No. 20-41707 Chapter 11 Petition filed August 3, 2020 represented by: Robert DeMarco, Esq. In re Albert Aguero and Cynthia Ayala Aguero Bankr. S.D. Tex. Case No. 20-50087 Chapter 11 Petition filed August 3, 2020 represented by: Carl Barto, Esq. In re Harry Allen Hart Bankr. C.D. Cal. Case No. 20-15288 Chapter 11 Petition filed August 3, 2020 represented by: Summer Shaw, Esq. In re Larry C Talley, Jr. Bankr. N.D. Tex. Case No. 20-32101 Chapter 11 Petition filed August 3, 2020 represented by: Melissa Hayward, Esq. In re 14543 Stephen Street LLC Bankr. E.D. Va. Case No. 20-11809 Chapter 11 Petition filed August 4, 2020 See https://is.gd/pREmV5 represented by: Weon G. Kim, Esq. WEON G. KIM LAW OFFICE E-mail: jkkchadol99@gmail.com In re Solache V Enterprises, Inc. Bankr. N.D. Tex. Case No. 20-32104 Chapter 11 Petition filed August 4, 2020 See https://is.gd/5292cm represented by: Eric A. Liepins, Esq. ERIC A. LIEPINS E-mail: eric@ealpc.com In re New Seasong, LLC Bankr. N.D. Tex. Case No. 20-32105 Chapter 11 Petition filed August 4, 2020 See https://is.gd/Zz0AKA represented by: Eric A. Liepins, Esq. ERIC A. LIEPINS E-mail: eric@ealpc.com In re Lester Lamar Gray and Jane Gray Bankr. N.D. Ill. Case No. 20-15148 Chapter 11 Petition filed August 4, 2020 represented by: Richard Fonfrias, Esq. In re Janice Lynn Brown Landry Bankr. M.D. Tenn. Case No. 20-03655 Chapter 11 Petition filed August 4, 2020 ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2020. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***