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/raid1/www/Hosts/bankrupt/TCR_Public/200902.mbx T R O U B L E D C O M P A N Y R E P O R T E R Wednesday, September 2, 2020, Vol. 24, No. 245 Headlines 19 HIGHLINE: Unsecureds get Prorata of $25,000 21ST CENTURY ONCOLOGY: Lobbyists Can’t Collect Bonus AFFIRMATIVE INSURANCE: IRS Claim Has Admin Expense Priority Status AMERICAN BLUE: Sells 34 Restaurant Locations ANTERO RESOURCES: S&P Affirms 'B-' ICR; Outlook Negative API AMERICAS: Liquidating Plan Approved by Judge ARCHDIOCESE OF NEW ORLEANS: To Cut 19 Jobs in the Fall ART & ARCHITECTURE: Sept. 2 Hearing on Agent's Banksy Artwork Sale BAINBRIDGE UINTA: Case Summary & 20 Largest Unsecured Creditors BIZ AS USUAL: Gets Approval to Hire New Legal Counsel BIZNESS AS USUAL: Gets Approval to Hire New Legal Counsel BJ SERVICES: Ritchie Bros. Selling Hundreds of Truck Tractors BJ SERVICES: Sale of Cementing Business to American Cementing OK'd BJ SERVICES: To Cut 273 Jobs in Shreveport After Bankruptcy Filing BRIGGS & STRATTON: Auction of Assets & Equity Interests Okayed BRIGGS & STRATTON: Judge Permits Interim DIP Financing BROOKS BROTHERS: Selling Massachusetts Factory for $14M BRUIN E&P PARTNERS: Emerges From Chapter 11 Bankruptcy BULLARD FENCE: Court Approves Disclosure Statement BULLS HEAD: Seeks to Tap Morrison Tenenbaum as Legal Counsel BYRD FAMILY: Proposes to Sell Lebanon Property for $800K CARR CREATIVE: Unsecureds to Split $12,000 Under Plan CARVER GARDENS: S&P Cuts 2013A Housing Revenue Bond Rating to 'BB' CELADON GROUP: Proposes $3.25M Settlement in Ch.11 Receivable Fight CHAMBERLAIN FAIRVIEW: Plan of Reorganization Confirmed by Judge CHAPARRAL ENERGY: Hires Opportune LLP as Restructuring Advisor CHAPARRAL ENERGY: Taps Kurtzman Carson as Administrative Advisor CHAPARRAL ENERGY: Taps Rothschild, Intrepid as Investment Bankers CHESAPEAKE ENERGY: Seeks to Cancel $300M Energy Transfer Contract CHF CHICAGO: S&P Cuts 2017A, 2017B Revenue Bond Ratings to 'BB' CIGAR BROTHERS: U.S. Trustee Unable to Appoint Committee CINEMEX USA: Oct. 1 Auction of Substantially All Assets Set CNX RESOURCES: S&P Alters Outlook to Stable, Affirms 'B+' ICR COLDWATER CREEK: Says It's Time to Say Goodbye CONFIE SEGUROS: S&P Affirms 'B-' ICR & Alters Outlook to Negative CORT & MEDAS: Oct. 22 Auction of 2 Brooklyn Properties Set DEAN FOODS: Court Approves Property Insurance Coverage Reduction DEAN FOODS: U.S. Trustee Says It Must Keep Casualty Insurance DESTINY SPRINGS: Sept. 2 Disclosure Statement Hearing Set EARTH FARE: Will Reopen Midtown Row Location EAST CAROLINA: Has Until Sept. 25 to File Plan & Disclosures ELDER ATTIE: Plan to be Funded by Rental/Property Sale Proceeds ELK CITY LODGING: $1.7M Cash Sale Elk City Property to Patel Okayed ELMORE REALTY: $350K Sale of Holland Property Deemed Moot EQT CORP: S&P Affirms 'BB-' ICR, Alters Outlook to Stable FAITH CATHEDRAL: Seeks Approval to Hire POHL as Bankruptcy Counsel FIRST ENERGY CORP: Analysts Forecast Its Economic Fallout FLORIDA FIRST: Nov. 17 Auction of Substantially All Assets Set FM COAL: Case Summary & 40 Largest Unsecured Creditors FROGNAL HOLDINGS: U.S. Trustee Unable to Appoint Committee FRUITION RESTAURANTS: Seeks to Hire Henry & Regel as Legal Counsel GATEWAY FIVE: Case Summary & 16 Unsecured Creditors GLOBAL ASSET: Sept. 18 Auction of Substantially All Assets Set GLOBAL EAGLE: Has $675M Deal With 1st Lien Lenders GLOBAL EAGLE: Oct. 9 Auction of Substantially All Assets GNC HOLDINGS: Break-Up Fee in Harbin Deal Reduced GOODRICH QUALITY: Sept. 10 Hearing on Personal Property Sale GOODRX INC: S&P Raises ICR to 'B+' on Strong Operating Performance GRAND CANYON RANCH: Approval of Counsel's Contingency Fee Upheld GRUPO AEROMEXICO: Court Approves Interim DIP Financing GRUPO AEROMEXICO: Reaches Deal With Short Term CEBURES Holders HAJ PETROLEUM: Proposed Sale of South Elgin Property Approved HELEN E.A. TUDOR: $1.2M Sale of Chapman's Apalachicola Property OKd HERTZ CORP: Asks Bankruptcy Judge to Boot False-Arrest Suits IMAGEWARE SYSTEMS: Nantahala Capital Reports 9.1% Equity Stake IMH FINANCIAL: JPM to Get 100% of Common Shares in Plan Deal JASON HOLDINGS: S&P Assigns CCC+ ICR on Bankruptcy Exit JUAN L. LARINO: $510K Sale of Newark Property to Vorhand Approved LAKELAND TOURS: WorldStrides Sees October Emergence LAKEWAY PUBLISHERS: $303K Sale of Ultranet Subdvision Approved LATAM AIRLINES: Court OKs $9.8M Breakup Fee on $1.3B Loan LEARFIELD COMMUNICATIONS: Moody's Rates First Lien Term Loan 'B3' LIBBEY GLASS: SEC Objects to Disclosure Statement & Joint Plan LITTLE DISCOVERIES: Sept. 10 Disclosure Statement Hearing Set LVI INTERMEDIATE: Antitrust Concerns Raised by Creditors MACHINE TECH: $129K Sale of Adel Property to Trust Custodian Okayed MARIZYME INC: Board Appoints Bruce Harmon as New CFO MARIZYME INC: Incurs $435K Net Loss in Second Quarter METRONET HOLDINGS: S&P Affirms 'B' First-Lien Term Loan Rating MIDLAND COGENERATION: S&P Cuts Senior Secured Notes Rating to 'BB' MONAKER GROUP: May Issue 1.5M Shares Under 2017 Equity Plan NATIONAL CAMPUS: S&P Affirms 2015A, 2015B Bond Rating at 'CCC' NEOVASC INC: Partially Prepays Convertible Debenture NEW HOPE CULTURAL: S&P Cuts 2019A Bond Rating to 'BB+(sf)' NPHSS LLC: $6.5M Sale of Carmel Property to Legatum Approved OGGUSA INC: CFSB Consents to Sale of Paducah Property for $975K ONEWEB GLOBAL: Asks Court to Reject Billion Loans Creditor Probe ONONDAGA COMMUNITY COLLEGE: S&P Cuts 2015A Rev Bond Rating to 'BB+' PATRIOT WELL: Eyes Quick Sale Process to Exit Chapter 11 PCI GAMING: S&P Affirms 'BB+' ICR; Outlook Negative PETSWAY INC: Sept. 23 Plan & Disclosure Hearing Set POET TECHNOLOGIES: Provides Highlights from Annual General Meeting PROVIDENT GROUP: S&P Cuts 2013 Bond Rating to BB-; Outlook Negative PURDUE PHARMA: Collegium Wants Patent Litigation to Resume QUEST PATENT: Ceases Trading on OTCQB Market REAL GOODS SOLAR: 3 Units Sent to Chapter 7 Bankruptcy RGN-ARLINGTON VI: Case Summary & Unsecured Creditor RHINO RESOURCE: In Chapter 11 Due to Drop in Coal Demand ROBERT ALLEN: $74K Sale of Pocatello Properties to Land Quest OK'd RTW RETAILWIND: Plans to Close 2 Stores in Richmond Malls SALIENT CRGT: S&P Affirms 'B-' ICR; Outlook Negative SCOTT C. GRAY: $940K Sale of Santa Rosa Residential Property Okayed SEVEN COUNTIES: Eligible to File for Chapter 11, Ky. S.C. Rules SEVEN COUNTIES: On Hook on Its Pension Contributions SPIRIT AIRLINES: Fitch Rates $600MM Secured Notes 'BB+/RR1' STEPHEN JAY ROBERSON: $515K Cash Sale of Frankin Property Approved TAILORED BRANDS: Walks Away From 100 Retail Leases TAMPA BAY MARINE: $27K Sale of 2016 Ford F350 Truck to Jaeger OK'd TOWN SPORTS: Moody's Cuts CFR to C, Outlook Remains Stable VIRGINIA TRUE: Cipollones Object to Diatomite's Plan & Disclosure WEINSTEIN CO: Two Actresses Want Case Converted to Chapter 7 WHEEL PROS: S&P Alters Outlook to Stable, Affirms 'B-' ICR WILLIAM H. THOMAS, JR: $360K Sale of Egner Property Approved [*] Bankruptcy & Commercial Lease Issues in Pandemic [*] Fending Off Preference Bankruptcy Claims During Pandemic [*] Loyalty Programs Can Save Car Rental Industry [*] One-Fifth of Department Stores Closed Down Since 2018 [*] Recent Bankruptcy Code Amendments and Its Effects on Creditors [*] Turning Business Shutdowns to New Opportunities [*] Unemployment Rises But Bankruptcies Drop in NC ********* 19 HIGHLINE: Unsecureds get Prorata of $25,000 ---------------------------------------------- 19 Highline Development LLC and Project 19 Highline LLC, submitted an Amended Disclosure Statement. Following a settlement reached with their senior secured lenders, Churchill Real Estate Fund LP, Specialty Credit Holdings, LLC, and Silver Point Select Opportunities Fund A, L.P. (collectively, the "Lenders"), the Debtors have pursued a sale the development property at 435-437 19th Street, New York, NY (the "Property") (owned by PropCo), despite a number of difficult challenges, culminating with the onset of the Covid-19 pandemic. At earlier points during the Chapter 11 cases, there were discussions regarding the prospects of the Lenders funding a reorganization plan based upon the establishment of a new DIP loan and exit facility to complete construction at the Property. This scenario proved unworkable for a variety of reasons, prompting the Debtors to pursue an auction sale of the Property, subject to the Lender’s credit bid rights. Despite the Covid-19 pandemic, the Debtor's broker (David Schechtman of Meridian Capital Group LLC) developed a comprehensive marketing campaign. Mr. Schechtman received inquiries from a number of potential parties, but ultimately, no parties were willing to make a bid that approached the Lenders' secured debt, and the Debtors were unable to obtain an actual third party offer for the Property. Accordingly, the Lenders have since elected to exercise their credit bid rights to take ownership via a sale and conveyance of the Property to the Lenders' designee (hereinafter, "NewCo Buying Entity"). Consequently, the sale and transfer of the Property shall be effectuated pursuant to the Plan based upon the Lenders' exercise of their credit bid rights. The Property shall be conveyed free and clear of all claims, liens, taxes and other interests, except for the Lenders' senior mortgage debt, which will be assumed by NewCo Buying Entity at its discretion. In consideration for the transfer of the Property hereunder, the Lenders shall pay the following claims and obligations: (i) Allowed Administration Expense Claims including the accrued fees of the CRO in an amount not to exceed $10,000, and Professional Fees of the Debtors’ counsel in an amount not to exceed $100,000, plus reimbursement of expenses; (ii) $25,000 to fund a separate creditor pool of $25,000 from which a pro rata distribution shall be made to the holders of allowed General Unsecured Claims. Lender is not responsible for paying more than $150,000 in support of the Plan, inclusive of all fees and costs. Since the Property did not generate any actual third party bids, the Lenders’ funding commitment offers a better recovery for creditors than they could reasonably expect to receive in liquidation. The Property lacks any possible equity and requires extensive work just to keep the structure from collapsing. Indeed, the remaining structure needs to be demolished in favor of constructing a new ground-up development. Given these harsh realities, the Plan provides the most expedient way of transitioning the project to new ownership, pays all of the costs of estate administration, and provides a modest recovery for other creditors. Besides the creditor pool, the Plan also offers General Unsecured Creditors and the overseas Class A investors (some of which have scheduled or filed claims) the equal opportunity to participate in a litigation trust or similar vehicle, following confirmation, to pursue Causes of Action belonging to the Debtors (the “Creditor Trust”). A full-text copy of the Amended Disclosure Statement dated July 22, 2020, is available at https://tinyurl.com/y3hhyyre from PacerMonitor.com at no charge. Attorneys for the Debtors: Kevin J. Nash Goldberg Weprin Finkel Goldstein LLP 1501 Broadway 22nd Floor New York, New York Tel: (212) 221-5700 About 19 Highline Development and Project 19 Highline 19 Highline Development LLC owns a 100% membership interest in Project 19 Highline Development LLC, which owns a condominium development project located at 435-437 19th Street, New York. The project contemplates construction of high-end residential condominiums, with a full "sell-out price" of approximately $60 million. 19 Highline Development sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 18-12714) on Sept. 7, 2018. On April 5, 2019, Project 19 Highline LLC filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No. 19-11068). At the time of the filing, 19 Highline Development had estimated assets of between $10 million and $50 million and liabilities of between $1 million and $10 million. Meanwhile, Project 19 Highline disclosed $55 million in assets and $40.46 million in liabilities. The cases are assigned to Judge Michael E. Wiles. Goldberg Weprin Finkel Goldstein LLP is the Debtors' legal counsel. 21ST CENTURY ONCOLOGY: Lobbyists Can’t Collect Bonus ------------------------------------------------------ Alex Wolf, writing for Bloomberg News, reports that the former lobbyist for 21st Century Oncology Holdings Inc. can't collect $9 million in bonus payments because of a cap on employee compensation claims on bankrupt companies, the Second Circuit ruled. Employee claims for damages "resulting from the termination of an employment contract" are explicitly capped under the U.S. bankruptcy code, the U.S. Court of Appeals for the Second Circuit ruled Monday. That cap applies to former 21st Century Oncology executive Andrew Woods, limiting his claim against the Florida cancer care provider's Chapter 11 estate to $4 million, the court said. About 21st Century Oncology Fort Myers, Florida-based 21st Century Oncology Holdings, Inc. (NYSEMKT:ICC), formerly Radiation Therapy Services Holdings, Inc., is a physician-led provider of integrated cancer care (ICC) services. It operates an integrated network of cancer treatment centers and affiliated physicians in the world which, as of December 31, 2015, deployed approximately 947 community-based physicians in the fields of radiation oncology, medical oncology, breast, gynecological, general surgery and urology. As of December 31, 2015, the Company's physicians provided medical services at approximately 375 locations, including over 181 radiation therapy centers, of which 59 operated in partnership with health systems. Its cancer treatment centers in the United States are operated under the 21st Century Oncology brand. As of Sept. 30, 2016, 2st Century had $1.05 billion in total assets, $1.39 billion in total liabilities, $472.34 million in series A convertible redeemable preferred stock, $19.24 million in non-controlling interests -- redeemable and a total deficit of $833.89 million. 21st Century and 59 U.S. affiliates filed Chapter 11 petitions under the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 17-22770) on May 25, 2017. At the time of the filing, the Debtors estimated their assets and debt at $1 billion to $10 billion. The bankruptcy cases are before the Hon. Judge Robert D. Drain. Lorenzo Marinuzzi, Esq., at Morrison & Foerster LLP, serves as the Debtors' bankruptcy counsel. Kurtzman Carson Consultants LLC is the Debtors' claims and noticing agent. On June 8, 2017, the Office of the U.S. Trustee appointed an official committee of unsecured creditors. The Committee has tapped Morrison & Foerster LLP as counsel and Berkeley Research Group, LLC, and financial advisor. AFFIRMATIVE INSURANCE: IRS Claim Has Admin Expense Priority Status ------------------------------------------------------------------ In the case captioned UNITED STATES OF AMERICA, Appellant, v. DON A. BESKRONE, CHAPTER 7 TRUSTEE, Appellee, Civ. No. 19-2034-RGA (D. Del.), District Judge Richard G. Andrews reverses the Bankruptcy Court's order treating Debtors Affirmative Insurance Holdings and affiliates' IRS administrative expense priority claim as a general unsecured claim. The issue is how to treat the "straddle year" for federal income tax under the current Bankruptcy Code. The Bankruptcy Court ruled that the straddle year should be bifurcated into pre- and post-petition periods; that income tax obligations must be allocated between those two periods; and that income taxes resulting from pre-petition events during the straddle year are accorded general unsecured treatment, while income taxes resulting from post-petition events in that same straddle year are granted administrative priority treatment. The issue arises because the corporate debtors, Affirmative Insurance Holdings, Inc. and certain affiliates, filed for bankruptcy in October 2015. Their tax year ended on December 31st, and, in due course, based on the Debtors' tax filing for 2015, the IRS filed an administrative expense priority claim in the bankruptcy cases for approximately $850,000 of taxes, penalties, and interest. Judge Andrews says the tax events that gave rise to the tax obligations occurred pre-petition. Thus, the Bankruptcy Court's determination meant that the IRS's claim would be treated as a general unsecured claim, with a low probability of any significant distribution from the estate. The United States, on behalf of the IRS, has appealed the Order. The United States challenges the Bankruptcy Court's conclusion that a claim for corporate income taxes for the straddle year is only entitled to administrative priority to the extent it is attributable to post-petition income. Prior to filing for bankruptcy, the Debtors had sold or otherwise disposed of substantially all of their material assets. On Oct. 14, 2015, the Debtors each filed a voluntary petition for relief under Chapter 11. The Bankruptcy Court later entered an order converting the Debtors' cases to cases under Chapter 7, and, thereafter, Trustee was appointed. On Sept. 14, 2016, Trustee filed the Debtors' consolidated federal tax return for the 2015 calendar year. The Debtors' full year consolidated taxable income was realized principally from the pre-petition activities. Based on their taxable income, the consolidated Debtors had a full tax year obligation of $792,113, plus an estimated penalty of $14,341. The IRS filed a timely administrative expense claim for taxes for the tax year ending 2015. Subsequently, the IRS filed an amended administrative expense claim that amended and superseded the original claim. The IRS Claim is comprised of the following amounts: (i) $792,113.00 (tax due), (ii) $18,566 (interest due), and (iii) $46,025.52 (penalty due). Trustee filed the Claim Objection seeking entry of an order disallowing administrative expense priority for the IRS Claim and reclassifying the entirety of the IRS Claim as a general unsecured claim. The Bankruptcy Court held oral argument, and thereafter issued a comprehensive Opinion that sustained the Trustee's objection in part. Judge Andrew says the Bankruptcy Court's analysis speaks for itself, but it could fairly be summed up as: Pre- Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), the Third Circuit held that such straddle tax years must be bifurcated into (at the time) priority and unsecured claims; nothing in the plain meaning of the statute or the legislative history of BAPCPA would justify departing from this approach; and administrative priority should be applied only to obligations resulting in or arising from a benefit received after the bankruptcy estate came into existence, "unless Congress gives specific instructions otherwise." Applying the bifurcated approach to the issue, the Bankruptcy Court held "that pre-petition events that incur tax liability during 'Straddle Tax Years' are afforded general unsecured status whereas, post-petition events that incur tax liability during those same 'Straddle Tax Years' are afforded administrative priority . . ." The Order thus sustained the Claim Objection in part and granted the United States ninety days to amend its claim and specify whether any of the IRS Claim is allocable to post-petition events. On Oct. 28, 2019, the United States filed a notice of intent not to amend the IRS Claim, along with its notice of appeal. The United States contends on appeal that the Bankruptcy Court reached the wrong result because under applicable non-bankruptcy law -- the Internal Revenue Code -- a corporation's entire annual income tax accrues on the last day of the tax year. Because a corporation has only a single tax liability for a tax year, the entire tax is "incurred by the estate" on that day. The United States argues that the Bankruptcy Court erred in its failure to consider the language of the IRC in its determination of when federal income tax is incurred. The United States further argues that both the Bankruptcy Code and the IRC distinguish income taxes from the sort of transaction- or event-based taxes which were the subject of cases relied on by the Bankruptcy Court. The United States says BAPCPA clarified that a tax year cannot be bifurcated. Finally, the United States argues that the legislative history of section 503 demonstrates that income taxes are incurred at the end of the tax year. Judge Andrews agrees with the Bankruptcy Court that there is no statutory language or legislative history to support the United States' contention that the BAPCPA amendments to section 507(a)(8)(A) expressly provided that income taxes for the straddle year are entirely post-petition administrative expenses. However, in line with the Third Circuit's analysis in Columbia Gas, 37 F.3d at 984, a court should look to underlying substantive tax law to determine whether and when taxes are "incurred by the estate" for purposes of section 503(b)(1)(B). Based on the IRC, corporate federal income tax liability accrues and becomes a fixed liability on the last day of the tax period -- here, Dec. 31, 2015. Accordingly, the tax at issue in the IRS Claim was incurred by the estate post-petition and should be entitled to priority as an administrative expense. A copy of the Court's Memorandum Opinion dated July 27, 2020 is available at https://bit.ly/3gT1Izi from Leagle.com. Richard E. Zuckerman, Esq. , Principal Deputy Assistant Attorney General; Christopher J. Williamson, Esq. , Ward W. Benson, Esq. (argued), Tax Division, U.S. Department of Justice, Washington, D.C., attorneys for appellant the United States. Ricardo Palacio, Esq. (argued), Stacy L. Newman, Esq., Ashby & Geddes, P.A, Wilmington, Delaware, attorneys for appellee Don A. Beskrone, Chapter 7 Trustee. About Affirmative Insurance Affirmative Insurance Holdings, Inc., Affirmative Management Services, Inc., Affirmative Services, Inc., Affirmative Underwriting Services, Inc., Affirmative Insurance Services, Inc., Affirmative General Agency, Inc., Affirmative Insurance Group,Inc. and Affirmative, L.L.C. sought Chapter 11 bankruptcyprotection (Bankr. D. Del. Proposed Lead Case No. 15-12136) on Oct. 14, 2015. The petition was signed by Michael J. McClure as chief executive officer. The Debtors engaged McDermott Will & Emery LLP as general bankruptcy counsel, Polsinelli PC as local Delaware counsel, Faegre Baker Daniels LLP as special regulatory counsel, BDO USA LLP as financial consultant and Rust Consulting/Omni Bankruptcy as notice and claims agent. The Debtors disclosed total assets of $25.20 million and total debts of $91.26 million as of Aug. 31, 2015. Founded in June 1998, Affirmative provided non-standard personal automobile insurance policies for individual consumers in targeted geographic markets. NSPAI policies provided coverage to drivers who find it difficult to obtain insurance from standard automobile insurance companies due to their lack of prior insurance, age, driving record, limited financial resources, or other factors. On Oct. 30, 2015, the Office of the U.S. Trustee appointed five creditors to the official committee of unsecured creditors. The Committee consisted of Alesco Preferred Funding X, Ltd., c/o ATP Management LLC; Alesco Preferred Funding VI, Ltd., c/o Mead Park Advisors LLC; Trapeza CDO IX, Ltd.; Trapeza Edge CDO, Ltd.; and The Bank of New York Mellon Trust Co., N.A., as Indenture Trustee for junior subordinated debt securities due March 15, 2035. The Committee selected Kilpatrick Townsend & Stockton LLP as it's counsel, Potter Anderson & Corroon LLP as cocounsel, and FTI Consulting, Inc. as its financial advisor. Anne Melissa Dowling, Insurance of the State of Illinois Acting Director, as the statutory and court-affirmed rehabilitator of Affirmative Insurance Company, was represented by Saul Ewing LLP's Mark Minuti, Esq.; and Faye B. Feinstein, Esq., and Christopher Combest, Esq., at Quarles & Brady LLP. Affirmative Insurance Holdings, Inc., et al., filed with the U.S. Bankruptcy Court for the District of Delaware a Chapter 11 plan of liquidation and accompanying disclosure statement, which proposed to pay 2% to holders of general unsecured claims against Holdco. Holders of general unsecured claims against AMSI, ASI, AUSI, AISI, AGAI, AIGI, and ALLC, were proposed to recover 0% of their allowed claims. AFFM Debt Holdings L.P., which held secured claims, was slated to recover 92% of its allowed claims. The filing of a plan of liquidation, however, failed to convince the Delaware bankruptcy judge to let the debtors keep their Chapter 11 cases. Judge Christopher S. Sontchi said Affirmative Insurance Holdings and its debtor-affiliates would liquidate in Chapter 7, thus granting a request for case conversion by the official committee of unsecured creditors. In a separate order that day, Judge Sontchi directed the Office of the United States Trustee to appoint a Chapter 7 Trustee to oversee the liquidation. AMERICAN BLUE: Sells 34 Restaurant Locations -------------------------------------------- Law360 reports that the American Blue Ribbon Holdings LLC, the parent company of restaurant chain Village Inn, received court approval July 21, 2020, from a Delaware bankruptcy judge for a pair of Chapter 11 asset sales that will see existing franchisees of the chain acquire 34 restaurants. During a hearing conducted via phone and video conferencing, U.S. Bankruptcy Judge Laurie Selber Silverstein approved the deals that will transfer three Florida restaurants to LDL Holdings Inc. in exchange for $300,000 and the assumption of liabilities currently held by the debtor, and another 31 locations spread across the country to Walker-DSC Capq LLC for a purchase price of $1.24 million. About American Blue Ribbon Based in Nashville, Tennessee, American Blue Ribbon Holdings, LLC -- http://www.americanblueribbonholdings.com/-- operates two distinct regional family dining restaurant brands -- Village Inn and Bakers Square, as well as a bakery operation, Legendary Baking. Founded in 1958 and 1969, respectively, Village Inn and Bakers Square are full-service sit-down family dining restaurant concepts that feature a variety of menu items for all meal periods. As of the Petition Date, in connection with the family dining business, the Debtors operate 97 restaurants in 13 states, franchise 84 Village Inn restaurants, and maintain an e-commerce presence as well. Legendary Baking is the Debtors' manufacturing operation that produces pies in two Debtor-owned production facilities. Legendary Baking provides those pies to the Family Dining Business for sale in Village Inn and Bakers Square restaurants while also selling pies to other restaurants, independent bakers, and customers. American Blue Ribbon Holdings and four affiliates, namely (1) Legendary Baking, LLC, (2) Legendary Baking Holdings, LLC, (3) Legendary Baking of California, LLC, and (4) SVCC, LLC, each filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 20-10161) on Jan. 27, 2020. As of the Petition Date, American Blue Ribbon Holdings estimated between $100 million and $500 million in assets and between $50 million and $100 million in liabilities. The petitions were signed by Kurt Schnaubelt, chief financial officer. Judge Laurie Selber Silverstein is assigned to the cases. Young Conaway Stargatt & Taylor, LLP and KTBS LAW LLP serve as the Debtors' counsel. Epiq Corporate Restructuring, LLC, is the Debtors' claims and noticing agent. ANTERO RESOURCES: S&P Affirms 'B-' ICR; Outlook Negative -------------------------------------------------------- S&P Global Ratings affirmed its 'B-' issuer credit rating and its 'B' issue-level rating on Antero Resources Corp. after the Denver-based independent natural gas and oil company managed to access the unsecured market with a $250 million convertible bond issuance, which helped address its near-term maturities. S&P removed the ratings from CreditWatch with negative implications, where they were placed on August 13, 2020. "The ratings reflect our view that Antero Resources Corp. should have sufficient liquidity to address its upcoming 2021 and 2022 unsecured bond maturities because of improved market access as evidenced by its recent convertible bond issuance, asset sales, and capacity under its $2.64 billion revolving credit facility maturing in 2022," S&P said. "In particular, Antero was recently able to access the capital markets with a $250 million privately placed convertible bond issuance, a transaction that we did not expect when we placed our ratings on the company and its debt on CreditWatch with negative implications as a result of its announced tender offer," the rating agency said. The transaction, combined with the company's recent asset sales, value of Antero Midstream holdings, secured debt capacity, and improving commodity prices for natural gas and natural gas liquids (NGLs), supports the company's ability to address upcoming debt maturities. Additionally, the company's free cash flow profile is improving. In April, it announced a reduction of capital expenditure (capex), and it more recently announced maintenance capex of about $580 million in 2021, providing for free cash flow of about $350 million -$400 million through 2021. Antero is about 93% hedged on natural gas through 2021, which supports its ability to meet stated free cash flow guidance and its ability to reduce debt in the near term. Additionally, Antero has been able to reduce its cost structure through operating efficiencies and service cost reductions. However, the outlook is negative because of the company's upcoming debt maturities over the next three years. It has almost $1.6 billion of debt due by June 2023, and it needs to address the maturity of its revolving credit facility due October 2022. Antero has about $317 million of bonds maturing in November 2021, $668 million maturing in December 2022, and $610 million maturing in June 2023, pro forma for the recent participation levels of its debt tender. This debt profile remains onerous in S&P's view, despite the company's improving liquidity profile. The negative outlook reflects S&P's view that the company's maturity profile remains onerous, given upcoming debt maturities in 2021, 2022, and 2023. Antero will need continued access to capital markets and a sustained improvement in commodity prices, especially for natural gas and NGLs, to address these maturities. "We could lower the rating if Antero fails to address its upcoming maturity profile in a timely manner or if natural gas and NGL prices decline due to reduced demand, which could hurt free cash flow and limit access to capital markets," S&P said. "We could revise the outlook to stable if Antero can reduce its near-term maturities, improve its liquidity profile, and refinance its credit facility with favorable terms. This would most likely occur if capital markets continually improve, especially for high-yield E&P companies, most likely in conjunction with the continued improvement of natural gas and NGL pricing," the rating agency said. API AMERICAS: Liquidating Plan Approved by Judge ------------------------------------------------ Law360 reports that Kansas-based laminates and foil label producer API Americas Inc. received court approval from a Delaware bankruptcy judge for its Chapter 11 plan of liquidation centered on an earlier global settlement with creditors. During a confirmation hearing conducted via phone and video conferencing, U.S. Bankruptcy Judge Christopher S. Sontchi granted final approval to the plan disclosure statement and confirmed the Chapter 11 plan itself without any objections. "I'm very happy to have an agreed upon liquidating plan that was able to incorporate the global settlement reached earlier in the case," Judge Sontchi said when confirming the plan. About API Americas Inc. API Americas Inc. -- http://www.apigroup.com/-- is a manufacturer of foils, laminates, and holographic materials. Among other customers, API Americas provides packaging to companies in the premium drinks, confectionery, tobacco, perfume, personal care, cosmetics, and healthcare sectors. API Americas was originally founded as Dry Print in New Jersey. Re-branded in 1998, API Americas is currently headquartered in Lawrence, Kansas inside a 56,000 square foot facility with manufacturing capabilities. API Americas Inc., and holding company API (USA) Holdings Limited, filed Chapter 11 petitions (Bankr. N.D. Del. Lead Case No. 20-10239) on Feb. 2, 2020. The petitions were signed by Douglas Woodworth, director. As of Dec. 31, 2019, API Americas Inc., had $37.3 million in total assets, $5.8 million in current liabilities and $47.3 million in long-term liabilities. API (USA) Holdings Limited had $51.6 million in total assets and $2.9 million in total liabilities. Saul Ewing Arnstein & Lehr LLP and Eversheds Sutherland (US) LLP represent the Debtors as general bankruptcy counsel. Ernst & Young LLP is the Debtors' financial advisor. Bankruptcy Management Solutions, Inc., d/b/a Stretto serves as the Debtors' claims and noticing agent. ARCHDIOCESE OF NEW ORLEANS: To Cut 19 Jobs in the Fall ------------------------------------------------------ Ramon Antonio Vargas, writing for Nola, reports that the Archdiocese of New Orleans plans to lay off 19 employees in the fall, a move it says is necessary to deal with financial strains caused by the coronavirus pandemic and its Chapter 11 bankruptcy filing earlier this year. Employees are set to lose their jobs on Sept. 15, according to a notice filed with the Louisiana Workforce Commission, though an archdiocesan spokeswoman said Tuesday some layoffs won't take effect until October 2020. Affected workers range from clerical staff to an executive director, and they include some employees who were recently furloughed because of the economic downturn. In its most recent financial report, the archdiocese reported a staff of 205. That means the layoffs represent just under 10% of the current workforce. While Archbishop Gregory Aymond oversees Catholic churches and schools in an eight-parish region, the archdiocese itself is chiefly an administrative office that supports the leaders of those institutions while also running a number of different programs and ministries. About the Archdiocese of New Orleans The Roman Catholic Church of the Archdiocese of New Orleans -- https://www.nolacatholic.org/ -- is a non-profit religious corporation incorporated under the laws of the State of Louisiana. Created as a diocese in 1793, and established as an archdiocese in 1850, the Archdiocese of New Orleans has educated hundreds of thousands in its schools, provided religious services to its churches and provided charitable assistance to individuals in need, including those affected by hurricanes, floods, natural disasters, war, civil unrest, plagues, epidemics, and illness. Currently, the archdiocese's geographic footprint occupies over 4,200 square Miles in southeast Louisiana and includes eight civil parishes -- Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. John the Baptist, St. Tammany, and Washington. The Roman Catholic Church for the Archdiocese of New Orleans sought Chapter 11 protection (Bankr. E.D. La. Case No. 20-10846) on May 1, 2020. The archdiocese was estimated to have $100 million to $500 million in assets and liabilities as of the bankruptcy filing. Judge Meredith S. Grabill oversees the case. The archdiocese is represented by Jones Walker LLP. Donlin, Recano & Company, Inc. is the claims agent. The Office of the U.S. Trustee appointed a committee of unsecured creditors on May 20, 2020. The committee is represented by Pachulski Stang Ziehl & Jones, LLP and Locke Lord, LLP. ART & ARCHITECTURE: Sept. 2 Hearing on Agent's Banksy Artwork Sale ------------------------------------------------------------------ Judge Robert Kwan of the U.S. Bankruptcy Court for the Central District of California will convene on Zoom for the Government a pretrial video conference on Sept. 2, 2020 at 2:00 p.m. on the contested matter of the Application of Sam S. Leslie, Plan Agent for Art and Architecture Books of the 21st Century, for Issuance of Order Approving the Issuance of Writ of Execution and Appointment of Plaintiff as Substitute Custodian for U.S. Marshal in Furtherance of Execution of Writ and Notice of Levy as to the so-called Banksy artwork. On Aug. 19, 2020, the Court held an initial Pre-Trial Technical Status Conference in the adversary proceeding as to the contested matter of the Plan Agent's proposed sale of the Banksy artwork. The Court also ordered the parties to the contested matter to file a joint pretrial stipulation if they can, or a separate proposed pretrial stipulation if they cannot agree to a joint one, within the meaning of Local Bankruptcy Rule 7016-1 by close of business (5:00 p.m.) on Aug. 28, 2020. Participants in the pretrial conference will be connected with the courtroom via Zoom for Government but will not be physically present in the courtroom. Instead, they Utilize the following link: https://cacb.zoomgov.com/j/1611438604 and insert Meeting ID: 161 143 8604 and Password: 824762. For the Audio-only participants, they must call into Zoom for Government by calling +1 (669) 2545252 or +1 (646) 8287666, and insert Meeting ID: 161 143 8604 and Password: 824762. About Art and Architecture Art and Architecture Books of the 21st Century, dba Ace Gallery, filed for a voluntary Chapter 11 petition on Feb. 19, 2013, in the U.S. Bankruptcy Court for the Central District of California, Case No. 13-14135. The petition was signed by Douglas Chrismas, president. Judge Robert Kwan presides over the case. Joseph A. Eisenberg, Esq., at Jeffer Mangels Butler & Mitchell LLP, serves as counsel. The Debtor reported $1 million to $10 million in assets and $10 million to $50 million in debts. BAINBRIDGE UINTA: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Lead Debtor: Bainbridge Uinta, LLC 8150 N. Central Expressway, Suite 650 Dallas, TX 75206 Business Description: The Debtors develop and operate fields to extract crude oil and natural gas. Chapter 11 Petition Date: September 1, 2020 Court: United States Bankruptcy Court Northern District of Texas Two affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Bainbridge Uinta, LLC 20-42794 Bainbridge Uinta Holdings, LLC 20-42795 Judge: Debtors' Counsel: Joseph M. Coleman, Esq. KANE RUSSELL COLEMAN LOGAN PC 901 Main Street, Suite 5200 Dallas, TX 75202 Tel: 214-777-4200 Email: jcoleman@krcl.com Debtors' Financial Advisor: OAK HILLS SECURITIES, INC. Debtors' Claims & Noticing Agent: STRETTO Bainbridge Uinta, LLC's Estimated Assets: $50 million to $100 million Bainbridge Uinta, LLC's Estimated Liabilities: $50 million to $100 million Bainbridge Uinta Holdings' Estimated Assets: $50 million to $100 million Bainbridge Uinta Holdings' Estimated Liabilities: $50 million to $100 million The petitions were signed by Paul D. Ching, chief executive officer. Copies of the petitions are available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/HMN4INY/Bainbridge_Uinta_Holdings_LLC__txnbke-20-42795__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/3PTGGYQ/Bainbridge_Uinta_LLC__txnbke-20-42794__0001.0.pdf?mcid=tGE4TAMA List of Bainbridge Uinta, LLC's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Rhetts Trucking LLC $175,922 Department 609 PO Box 30078 Salt Lake City, UT 84130 2. Ponderosa Oilfield $65,188 Service Inc. 807 East 500 South Vernal, UT 84078 3. National Oilwell Varco LP $46,496 PO Box 202631 Dallas, TX 75320-2631 4. Double Hook Inc. $34,415 1843 West 1500 S Vernal, UT 84078-4527 5. Energy Armor LLC $24,676 PO Box 1445 Vernal, UT 84078 6. Red Mountain Equipment $12,015 Supply Inc. 625 W 500 N PO Box 447 Vernal, UT 84078 7. Reladyne West LLC $11,214 PO Box 954039 Saint Louis, MO 63195-4039 8. Endurance Lift $9,008 Solutions LLC PO Box 843175 Dallas, TX 75284 9. Split Mountain Pipe & $6,182 Supply Inc. 1120 East Hwy 40 Vernal, UT 84078 10. Rusco Operating, LLC $5,800 111 Congress Ave, Suite 900 Austin, TX 78701 11. RN Industries Inc. $5,570 PO Box 1168 Roosevelt, UT 84066 12. Automation X Corporation $3,941 Dept 1538 PO Box 17180 Denver, CO 80217 13. Wild Mountain Supply LLC $3,450 2959 N 3000 W Oakley, UT 84055 14. Pumpers Inc. $2,669 P.O. Box 1015 Roosevelt, UT 84066 15. B&G Crane and Oilfield Services Inc. $2,100 PO Box 527 Altamont, UT 84001 16. Auto Tech $873 PO Box 1024 Vernal, UT 8407 17. Arrow Oilfield $745 and Sanitation Inc. PO Box 1049 Roosevelt, UT 84066 18. Oil and Gas $560 Equipment Corp. PO Box 459 Flora Vista, NM 87415 19. Five Star Tire Auto LLC $514 1011 West HWY 40 Vernal, UT 84078 20. J&C Enterprises Inc. $435 PO Box 1096 Vernal, UT 84078 Bainbridge Uinta Holdings stated it has no unsecured creditors. BIZ AS USUAL: Gets Approval to Hire New Legal Counsel ----------------------------------------------------- Biz as Usual, LLC received approval from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to employ Lee Herman, Esq., an attorney practicing in Media, Pa., to handle its Chapter 11 case. Mr. Herman will serve as Debtor's new legal counsel, replacing Michael Kutzer, Esq. The attorney will be compensated at the rate of $350 per hour. He will also receive an initial retainer of $5,000, to be paid by a relative of Debtor's managing member, Antoine Gardiner. Mr. Herman, Esq., disclosed in court filings that he does not represent interests adverse to Debtor and its bankruptcy estate. The attorney can be reached at: Lee M. Herman, Esq. 280 N. Providence Road, Suite 4 Media, PA 19063 Telephone: (610) 891-6500 About Biz as Usual Biz as Usual, LLC's primary business involves leasing its residential properties and commercial spaces. It owns nine pieces of real estate situated in Philadelphia County, which were acquired steadily over 15 years. Biz as Usual filed for Chapter 11 bankruptcy protection (Bankr. E.D. Pa. Case No. 19-16476) on Oct. 15, 2019, listing under $1 million in both assets and liabilities. Judge Eric L. Frank oversees the case. Lee M. Herman, Esq., replaced Michael Kutzer, Esq., as Debtor's bankruptcy counsel. BIZNESS AS USUAL: Gets Approval to Hire New Legal Counsel --------------------------------------------------------- Bizness as Usual Inc. received approval from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to employ Lee Herman, Esq., an attorney practicing in Media, Pa., to handle its Chapter 11 case. Mr. Herman will serve as Debtor's new legal counsel, replacing Michael Kutzer, Esq. The attorney will be compensated at the rate of $350 per hour. He will also receive an initial retainer of $5,000, to be paid by a relative of Debtor's managing member, Antoine Gardiner. Mr. Herman, Esq., disclosed in court filings that he does not represent interests adverse to Debtor and its bankruptcy estate. The attorney can be reached at: Lee M. Herman, Esq. 280 N. Providence Road Suite 4 Media, PA 19063 Telephone: (610) 891-6500 About Bizness as Usual Bizness as Usual Inc., a real estate management company based in Villanova, Pa., filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Pa. Case No. 19-16477) on Oct. 15, 2019, listing under $1 million in both assets and liabilities. Judge Eric L. Frank oversees the case. Lee M. Herman, Esq., replaced Michael Kutzer, Esq., as Debtor's bankruptcy counsel. BJ SERVICES: Ritchie Bros. Selling Hundreds of Truck Tractors ------------------------------------------------------------- Ritchie Bros., a global leader in asset management and disposition, announced Aug. 31, 2020, that it has received bankruptcy court approval to sell hundreds of truck tractors on behalf of BJ Services, North America's largest pure-play pressure pumping services company. "We are excited to bring BJ Services' late-model and well-maintained fleet of truck tractors to market," said Sam Wyant, Senior Vice President, Strategic Accounts, Ritchie Bros. "As one of the leaders in their field, we expect to see a lot of demand for these assets, which will sell across our numerous sales channels, including a large portion selling at our upcoming Fort Worth, TX auction on September 29 – 30, 2020." For more information, visit RitchieBros.com. To view the complete inventory of assets consigned by BJ Services, click here. Established in 1958, Ritchie Bros. (NYSE and TSX: RBA) is a global asset management and disposition company, offering customers end-to-end solutions for buying and selling used heavy equipment, trucks and other assets. Operating in a number of sectors, including construction, transportation, agriculture, energy, oil and gas, mining, and forestry, the company's selling channels include: Ritchie Bros. Auctioneers, the world's largest industrial auctioneer offers live auction events with online bidding; IronPlanet, an online marketplace with featured weekly auctions and providing the exclusive IronClad Assurance® equipment condition certification; Marketplace-E, a controlled marketplace offering multiple price and timing options; Mascus, a leading European online equipment listing service; and Ritchie Bros. Private Treaty, offering privately negotiated sales. The company's suite of multichannel sales solutions also includes Ritchie Bros. Asset Solutions, a complete end-to-end asset management and disposition system. Ritchie Bros. also offers sector-specific solutions including GovPlanet, TruckPlanet, and Kruse Energy Auctioneers, plus equipment financing and leasing through Ritchie Bros. Financial Services. For more information about Ritchie Bros., visit RitchieBros.com. About BJ Services BJ Services, LLC, and its related entities are providers of pressure pumping and oilfield services for the petroleum industry. Headquartered in Tomball, Texas, the companies operate through two segments, hydraulic fracturing and cementing. BJ Services -- https://www.bjservices.com/ -- primarily serves customers in upstream North American oil and natural gas shale basins in the completion of new wells and in remedial work on existing wells. Chapter 11 petitions were filed by BJ Services (Bankr. S.D. Tex. Case No. 20-33627), as Lead Debtor, together with its affiliates BJ Management Services, L.P. (Case No. 20-33628), BJ Services Holdings Canada, ULC (Case No. 20-33629), and BJ Services Management Holdings Corp. (Case No. 20-33630) on July 20, 2020. The cases are assigned to Judge Marvin Isgur. In the petition signed by CEO Warren Zemlak, BJ Services was estimated to have assets at $500 million to $1 billion and $500 million to $1 billion in debt. The Debtors tapped Joshua A. Sussberg, P.C., at Kirkland & Ellis LP; Christopher T. Greco, P.C., at Kirkland & Ellis International LP; Samantha G. Lawrence, Esq., and Joshua M. Altman, Esq., as their General Bankruptcy Counsel. The Debtors tapped Jason S. Brookner, Esq., Paul D. Moak, Esq., Amber M. Carson, Esq., at Gray Reed & McGraw LLP as their co-bankruptcy counsel. BJ SERVICES: Sale of Cementing Business to American Cementing OK'd ------------------------------------------------------------------ Judge Marvin Isgur of the U.S. Bankruptcy Court for the Southern District of Texas authorized BJ Services, LLC and its Debtor affiliates to sell their cementing business to American Cementing, LLC. Subject to any adjustment, the aggregate consideration to be paid by Purchaser for the purchase of the Acquired Assets will be: (y) the assumption of Assumed Liabilities and (z) a cash payment of $35 million, (A) plus (in the event the Estimated Inventory exceeds the Target Inventory) the amount, if any, by which the Estimated Inventory exceeds the Target Inventory or (B) minus (in the event the Target Inventory exceeds the Estimated Inventory) the amount, if any, by which the Target Inventory exceeds the Estimated Inventory, and (C) minus the Estimated Property Taxes. The Stalking Horse Agreement is approved. Bharat Forge Limited ("BFL") and the Debtors are parties to that certain Agreement, as defined in the Objection filed by BFL. The Agreement is not being assumed by the Debtors or assigned to the Purchaser. The Debtors are authorized to assume the Assumed Contracts and to assign the Assumed Contracts to the Buyer or to any permitted assign, which assignment will take place on and be effective as of the Closing or as otherwise provided by order of the Court or by the Stalking Horse Agreement. Upon receipt of the Sale proceeds, the Debtor will segregate and separately hold each of (a) the Sale proceeds attributable to the assets in which the GACP Secured Parties have a prepetition first priority security interest and (b) the Sale proceeds attributable to the assets in which the Prepetition ABL Secured Parties have a prepetition first priority security interest. Such Sale proceeds will only be distributed as provided by further order of the Court. Notwithstanding anything to the contrary in the Order, or any Notice related thereto, the following employee benefits agreements between Debtors and Cigna will not be assumed and assigned pursuant to the Sale Order. The Buyer assumes full responsibility for the 2020 ad valorem taxes associated with the Cementing Business owed to the Taxing Authorities and will be responsible for paying the ad valorem taxes in full, in the ordinary course of businesses, when due. The Debtors' prorated share of ad valorem taxes will be credited to the Buyer at closing on terms agreed upon by the Debtors and Purchaser as set forth in the Stalking Horse Agreement. The Order constitutes a final order within the meaning of 28 U.S.C. Section 158(a). Notwithstanding any provision in the Bankruptcy Rules to the contrary, including but not limited to Bankruptcy Rules 6004(h), 6006(d) and 7062, the Court expressly finds there is no reason for delay in the implementation of the Order and, accordingly: (a) the terms of the Order will be immediately effective and enforceable upon its entry; (b) the Debtors are not subject to any stay of the Order or in the implementation, enforcement, or realization of the relief granted in the Order; and (c) the Debtors may, in their discretion and without further delay, take any action and perform any act authorized under the Order. A copy of the Agreement is available at https://tinyurl.com/y6c5zxqd from PacerMonitor.com free of charge. The Purchaser: AMERICAN CEMENTING, LLC c/o Argonaut Private Equity 7030 South Yale Ave., #810 Tulsa, OK 74136 Attn: Phil VanTrease E-mail: philvt@argonautpe.com The Purchaser is represented by: Steve Walton, Esq. FREDERIC DORWART, LAWYER PLLC 124 East Fourth Street Tulsa, OK 74114 E-mail: swalton@fdlaw.com About BJ Services BJ Services, LLC and its affiliates are providers of pressure pumping and oilfield services for the petroleum industry. Headquartered in Tomball, Texas, the Debtors operate through two segments, hydraulic fracturing and cementing. The Debtors primarily serve customers in upstream North American oil and natural gas shale basins in the completion of new wells and in remedial work on existing wells. Visit https://www.bjservices.com/ for more information. BJ Services (Bankr. S.D. Tex. Case No. 20-33627), as Lead Debtor, together with its affiliates BJ Management Services, L.P. (Bankr. S.D. Tex. Case No. 20-33628), BJ Services Holdings Canada, ULC (Bankr. S.D. Tex. Case No. 20-33629), and BJ Services Management Holdings Corp. (Bankr. S.D. Tex. Case No. 20-33630), sought Chapter 11 protection on July 20, 2020. The cases are assigned to Judge Marvin Isgur. In the petition signed by CEO Warren Zemlak, the Debtor was estimated to have assets at $500 million to $1 billion and $500 million to $1 billion in debt. The Debtors tapped Joshua A. Sussberg, P.C., at Kirkland & Ellis LP; Christopher T. Greco, P.C., at Kirkland & Ellis International LP; Samantha G. Lawrence, Esq., and Joshua M. Altman, Esq., as their General Bankruptcy Counsel. The Debtors tapped Jason S. Brookner, Esq., Paul D. Moak, Esq., Amber M. Carson, Esq., at Gray Reed & McGraw LLP as their Co-Bankruptcy Counsel. BJ SERVICES: To Cut 273 Jobs in Shreveport After Bankruptcy Filing ------------------------------------------------------------------ KTAL/KMSS reports that BJ Services announced its plan to cut 273 jobs after it file bankruptcy protection. According to a Worker Adjustment and Retraining Notification (WARN) notice updated by the Louisiana Workforce Commission, BJ Services plans to lay off 273 employees in Shreveport on August 2. Under federal law, employers are required to provide advance notice of plant closures or mass layoffs. The Texas-based company provides hydraulic fracturing and cementing services to upstream oil and gas companies and has operations in every major basin throughout the U.S. and Canada. The company filed the WARN notice with the LWC on Sunday and filed for voluntary Chapter 11 bankrupcty on Monday, July 20, 2020. According to a statement released by the company, the plan is to sell its assets and is in active discussions with bidders regarding both the cementing business and portions of the fracturing business. The statement said the company believes the sales would reduce the number of jobs impacted by this process. "The industry continues to face unprecedented uncertainty caused by volatile commodity markets and significantly reduced demand due to the COVID-19 pandemic. Despite maintaining a leading market position and strong client support, the severe downturn in activity and subsequent lack of liquidity resulted in an unmanageable capital structure. After exhausting every possible alternative to address these issues and improve our liquidity, we have made the very difficult decision to proceed with a Chapter 11 process," said Warren Zemlak, President and Chief Executive Officer of BJ Services. "Our Board of Directors and the entire management team worked diligently over the course of the past several weeks to avoid this outcome. Having said that, we are pleased to be in discussions with interested bidders for our cementing business and for certain portions of our fracturing business and technology." According to the Associated Press, more than 200 oil producers have filed for bankruptcy protection in the past five years, a trend that's expected to continue as a global pandemic saps demand for energy and depresses prices further. About BJ Services BJ Services, LLC, and its related entities are providers of pressure pumping and oilfield services for the petroleum industry Headquartered in Tomball, Texas, the companies operate through two segments, hydraulic fracturing and cementing. BJ Services -- https://www.bjservices.com/ -- primarily serves customers in upstream North American oil and natural gas shale basins in the completion of new wells and in remedial work on existing wells. Chapter 11 petitions were filed by BJ Services (Bankr. S.D. Tex. Case No. 20-33627), as Lead Debtor, together with its affiliates BJ Management Services, L.P. (Case No. 20-33628), BJ Services Holdings Canada, ULC (Case No. 20-33629), and BJ Services Management Holdings Corp. (Case No. 20-33630) on July 20, 2020. The cases are assigned to Judge Marvin Isgur. In the petition signed by CEO Warren Zemlak, BJ Services was estimated to have assets at $500 million to $1 billion and $500 million to $1 billion in debt. The Debtors tapped Joshua A. Sussberg, P.C., at Kirkland & Ellis LP; Christopher T. Greco, P.C., at Kirkland & Ellis International LP; Samantha G. Lawrence, Esq., and Joshua M. Altman, Esq., as their general bankruptcy counsel. The Debtors tapped Jason S. Brookner, Esq., Paul D. Moak, Esq., Amber M. Carson, Esq., at Gray Reed & McGraw LLP as their co-bankruptcy counsel. BRIGGS & STRATTON: Auction of Assets & Equity Interests Okayed -------------------------------------------------------------- Judge Barry S. Schermer of the U.S. Bankruptcy Court for the Eastern District of Missouri authorized the bidding procedures of Briggs & Stratton Corp. and its affiliates in connection with the sale of (i) substantially all their assets, (ii) the equity interests in their non-Debtor foreign subsidiaries, and (iii) certain joint venture equity interests held by the Debtors, to Bucephalus Buyer, LLC for approximately $550 million cash, subject to certain adjustments, plus certain assumed liabilities, subject to overbid. The Debtors are authorized to enter into the Stalking Horse Agreement, and the Stalking Horse Bid will be subject to higher or otherwise better Qualified Bids, in accordance with the terms and procedures of the Bidding Procedures. The Stalking Horse Bid Protections are approved in their entirety, including the Termination Payment and Expense Reimbursement Payment (each as defined in the Stalking Horse Agreement), payable in accordance with, and subject to the terms of, the Stalking Horse Agreement and the Bidding Procedures. The salient terms of the Bidding Procedures are: a. Bid Deadline: Aug. 28, 2020, at 5:00 p.m. (CT) b. Initial Bid: The price proposed to be paid for the specified Assets and Equity Interests in U.S. Dollars. In addition, (a) a bid must propose a Purchase Price equal to or greater than the sum of (1) the value of Stalking Horse Bid; (2) an initial overbid, consisting of the sum of the Termination Payment ($16.5 million), the Expense Reimbursement Payment (up to $2.75 million), and $1 million; (b) the Purchase Price must include an amount in cash sufficient to satisfy the Termination Payment; and (c) the Purchase Price must be sufficient to pay in full all amounts outstanding under the DIP Credit Agreement. c. Deposit: 10% of the cash portion of the Purchase Price d. Auction: The Auction (if any) will be held on Sept. 1, 2020 at 10:00 a.m. (CT) if the Debtors receive more than one Qualified Bid, either (i) at the offices of Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York, New York 10153 or (ii) virtually pursuant to procedures to be filed by the Debtors on the Court's docket prior to the Auction. e. Bid Increments: $1 million f. Sale Hearing: Sept. 15, 2020 at 9:30 a.m. (CT) g. Sale Objection Deadline: Sept. 9, 2020, at 5:00 p.m. (CT) h. Closing: Nov. 19, 2020, subject to automatic extension to Dec. 31, 2020 to permit time for regulatory antitrust approvals i. Persons or entities holding a perfected security interest in any Assets or Equity Interests of a Debtor may ask to submit a credit bid for such Assets or Equity Interests. The Sale Notice is approved. As soon as practicable, but no later than five business days after entry of the Order, the Debtors will cause the Sale Notice upon all the Sale Notice Parties; and no later than seven business days after entry of the Order, cause the Sale Notice to be published on the Claims Agent Website and once in the national edition of The Wall Street Journal. The Assumption and Assignment Notice is approved. Not later than five business days after entry of the Order, the Debtors will file with the Court, serve on all Counterparties to Contracts and the Objection Notice Parties, and cause to be published on the Claims Agent Website an initial Assumption and Assignment Notice. The Debtors' assumption and assignment of a Proposed Assumed Contract to a Successful Bidder (or to a designee of the Successful Bidder) is subject to Court approval and consummation of a Sale Transaction with the applicable Successful Bidder. Notwithstanding the applicability of any of Bankruptcy Rules 6004(h), 6006(d), 7062, 9014, or any other provisions of the Bankruptcy Rules or the Local Rules or otherwise stating the contrary, the terms and conditions of the Order will be immediately effective and enforceable upon its entry, and any applicable stay of the effectiveness and enforceability of the Order is waived. No later than two business days after the date of the Order, the Debtors will serve a copy of the Order and will file a certificate of service no later than 24 hours after service. A copy of the Notices and the Bidding Procedures is available at https://tinyurl.com/y3tem9cn from PacerMonitor.com free of charge. About Briggs & Stratton Corporation Briggs & Stratton Corporation is a producer of gasoline engines for outdoor power equipment and a designer, manufacturer and marketer of power generation, pressure washer, lawn and garden, turf care, and job site products. The Company's products are marketed and serviced in more than 100 countries on six continents through 40,000 authorized dealers and service organizations. Visit https://www.basco.com for more information. Briggs & Stratton Corporation and four affiliates concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mo. Lead Case No. 20-43597) on July 20, 2020. The petitions were signed by Mark A. Schwertfeger, senior vice president and chief financial officer. At the time of the filing, Briggs & Stratton Corporation disclosed total assets of $1,589,398,000 and total liabilities of $1,350,058,000 as of March 29, 2020. Judge Barry S. Schermer oversees the cases. Debtors have tapped Weil, Gotshal & Manges LLP as bankruptcy counsel; Carmody MacDonald P.C. as local counsel; Foley & Lardner LLP as corporate counsel; Houlihan Lokey Inc. as investment banker; Ernst & Young, LLP as restructuring and tax advisor; Deloitte LLP as auditor and tax consultant; and Kurtzman Carson Consultants, LLC as claims and noticing agent. The Office of the U.S. Trustee appointed a committee to represent unsecured creditors in Debtors' Chapter 11 cases. BRIGGS & STRATTON: Judge Permits Interim DIP Financing ------------------------------------------------------ Allison McNeely, writing for Bloomberg News, reports that Briggs & Stratton Corp. can initially borrow as much as $178 million under its proposed bankruptcy loan, but a judge denied a request to seal the letter outlining JPMorgan Chase & Co.'s fees for arranging the financing. Judge Barry Schermer rejected arguments by counsel for the bank, which is providing the asset-based portion of its debtor-in-possession loan; JPMorgan contended that its fees should be kept private because they were below market and it was competitive information. "I don't think a Midwestern judge ... is going to reset the marketplace," Schermer said About Briggs & Stratton Briggs & Stratton Corporation (NYSE: BGG), headquartered in Milwaukee, Wisconsin, is a producer of gasoline engines for outdoor power equipment, and is a designer, manufacturer and marketer of power generation, pressure washer, lawn and garden, turf care and job site products through its Briggs & Stratton, Simplicity, Snapper, Ferris, Vanguard, Allmand, Billy Goat, Murray, Branco, and Victa brands. Briggs & Stratton products are designed, manufactured, marketed and serviced in over 100 countries on six continents. Visit http://www.basco.com/and http://www.briggsandstratton.comfor additional information. Briggs & Stratton reported a net loss of $54.08 million for the year ended June 30, 2019, compared to a net loss of $11.32 million for the year ended July 1, 2018. As of March 29, 2020, Briggs & Stratton had $1.59 billion in total assets, $930.28 million in total current liabilities, $419.77 million in total other liabilities, and $239.34 million in total shareholders' investment. * * * As reported by the TCR on June 23, 2020, S&P Global Ratings lowered its issuer credit rating on Briggs & Stratton Corp. to 'SD' from 'CCC-' because it believes the company is unlikely to make the interest payment on the notes within the 30-day grace period but expect that it will continue to pay interest on its asset-based lending revolving credit facility (unrated). As reported by the TCR on April 16, 2020, Moody's Investors Service downgraded its ratings for Briggs & Stratton Corporation, including the company's corporate family rating and probability of default rating (to Caa3 and Ca-PD, from B3 and B3-PD, respectively). The downgrades reflect Moody's expectation of an increased likelihood of default via a pre-emptive debt restructuring due to the company's perceived inability to refinance its $195 million of senior unsecured notes due December 2020, as compounded by its high financial leverage and deemed untenable capital structure. BROOKS BROTHERS: Selling Massachusetts Factory for $14M ------------------------------------------------------- Group Inc. is seeking bankruptcy court approval to sell its Southwick manufacturing facility for $14 million to an entity affiliated with Massachusetts-based developer Eastern Real Estate LLC. The luxury clothing retailer agreed to sell the 148,000 square foot facility located in Haverhill, Mass., to Eastern Opportunity Fund LLC last month, according to a filing with the U.S. Bankruptcy Court for the District of Delaware. Brooks Brothers halted operations and effectively closed the site in May as it dealt with losses from the Covid-19 pandemic. The factory had been run by Brooks Brothers affiliate Golden Fleece Manufacturing Group. About Brooks Brothers Group Brooks Brothers -- https://www.brooksbrothers.com -- is a clothing retailer with over 1,400 locations in over 45 countries. While famous for its clothing offerings and related retail services, Brooks Brothers is known as a lifestyle brand for men, women, and children, which markets and sells footwear, eyewear, bags, jewelry, watches, sports articles, games, personal care items, tableware, fragrances, bedding, linens, food items, beverages, and more. Brooks Brothers Group, Inc. is the Debtors' ultimate corporate parent, which directly or indirectly owns each of the other Debtor entities. Brooks Brothers Group, Inc. and 12 of its affiliates filed for Chapter 11 protection (Bankr. D. Del., Lead Case No. 20-11785) on July 8, 2020. The petitions were signed by Stephen Marotta, chief restructuring officer. The Debtors were estimated to have assets and liabilities to total $500 million to $1 billion. The Hon. Christopher Sontchi presides over the cases. Richards, Layton & Finger, P.A. and Weil, Gotshal & Manges LLP serve as counsel to the Debtors. PJ Solomon, L.P acts as investment banker; Ankura Consulting Group LLC as financial advisor; and Prime Clerk LLC as claims and noticing agent. BRUIN E&P PARTNERS: Emerges From Chapter 11 Bankruptcy ------------------------------------------------------ Bruin E&P Partners, LLC and its subsidiaries, an exploration and production company with assets in the Williston Basin, North Dakota, announced Aug. 31, 2020, that it has completed its restructuring process and has emerged from Chapter 11. The comprehensive balance sheet restructuring equitizes a substantial majority of the Company's funded debt. The Company emerges with $230 million in revolver capacity. Matt Steele, Chief Executive Officer of Bruin, commented that "Bruin has been able to undergo an extremely efficient and uncontentious Chapter 11 proceeding due to the support of our stakeholders, including our vendors, suppliers, regulatory agencies, banking group, and additional members of our capital structure. Most importantly, our employees have continued to work safely and productively through the process." Mr. Steele continued stating "We would like to thank each of our advisors for their guidance and tireless work and we look forward to continue to operate in the Williston Basin through our premier acreage position and operational excellence." Bruin emerges with a newly constituted Board of Directors, effective in conjunction with the Company's emergence from Chapter 11. The new Board is comprised of Kevin Asarnow, Mark Bisso, Richard J. Doleshek, Mike Wichterich, and Matthew Steele. More information about Bruin's restructuring, including access to Court documents, will be available at http://www.omniagentsolutions.com/bruinor contact Omni Agent Solutions, the Company's noticing and claims agent, at (866) 680-8161, or email BruinInquiries@OmniAgnt.com. For inquiries directly to the Company, please contact William Getschow at (281) 990-6953 orwgetschow@bruinep.com. About Bruin E&P Partners Bruin E&P Partners, LLC and its affiliates are a privately owned exploration and production enterprise focused on the acquisition and development of onshore oil and natural gas producing properties. Headquartered in Houston, Texas, and with offices in Colorado and North Dakota, Debtors have approximately 134 employees. For more information visit http://www.bruinep.com/ Bruin E&P Partners and its affiliates concurrently filed voluntary Chapter 11 petitions (Bankr. S.D. Tex. Lead Case No. 20-33605) on July 16, 2020. Bruin E&P CEO Matthew B. Steele signed the petitions. At the time of the filing, Bruin E&P disclosed estimated assets of $1 billion to $10 billion and estimated liabilities of the same range. Judge Marvin Isgur oversees the cases. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as legal counsel; Jackson Walker L.L.P. as local counsel; PJT Partners LP as financial advisor and investment banker; AlixPartners LLP as financial and restructuring advisor; and Omni Agent Solutions as claims and noticing agent. BULLARD FENCE: Court Approves Disclosure Statement -------------------------------------------------- Judge Cynthia C. Jackson has ordered that the Bullard Fence, Inc.'s Combined Disclosure Statement and Chapter 11 Plan of Reorganization meets the requirements of 1125 and the Disclosure Statement is approved. The Debtor-In-Possession's Combined Disclosure Statement and Chapter 11 Plan of Reorganization is confirmed. Bullard Fence, Inc., submitted a Combined Disclosure Statement and Chapter 11 Plan of Reorganization: * Class 1 (Marlin Business Bank). This class is impaired. In full satisfaction of its Class 1 Claims, the Debtor will make monthly payments as stated: -- Proof of Claim 3 regarding the Skid Steer Track Loader and accessories will be paid the value of the collateral, $18,000 over 60 months with 5.25% interest per annum. The monthly payment will be $341.75. No prepayment penalty shall apply to this Class. The remainder of Claim 3 shall receive distribution in Class 3. -- Proof of Claim 4 regarding the Cat 2C6000 will be paid $7,000 over 60 months with 5.25% interest per annum. The monthly payment shall be $132.90. No prepayment penalty shall apply to this Class. The remainder of Claim 3 shall receive distribution in Class 3. Class 3 (General Unsecured Creditors) is impaired. Class 3 consists of the All General Unsecured Creditors as provided on the attached Claims Breakdown. In full satisfaction of Class 3 Claims, the Debtor will pay $2,400.00 per quarter on a pro rata basis for 60 months to allowed General Unsecured Creditors which will include Proof of Claim 7 filed by Complete Business Solutions. Given the refined debt service as provided in this Plan, the Debtor will continue its operations which will cover the required new debt service payments. A full-text copy of the Combined Disclosure Statement and Chapter 11 Plan of Reorganization dated July 22, 2020, is available at https://tinyurl.com/yy3bnmos from PacerMonitor.com at no charge. Counsel for the Debtor: Jason A. Burgess The Law Offices of Jason A. Burgess, LLC 1855 Mayport Road Atlantic Beach, Florida 32233 Phone: (904) 372-4791 About Bullard Fence Bullard Fence, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-00723) on Feb. 28, 2020, listing under $1 million in both assets and liabilities. Judge Cynthia C. Jackson oversees the case. Jason A. Burgess, Esq., at The Law Offices of Jason A. Burgess LLC, represents the Debtor. BULLS HEAD: Seeks to Tap Morrison Tenenbaum as Legal Counsel ------------------------------------------------------------ Bulls Head Diner, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to employ Morrison Tenenbaum PLLC as its legal counsel. The firm will render these legal services: (a) advise Debtor with respect to its powers and duties in the management of its estate; (b) assist in any amendments of schedules and other financial disclosures and in the preparation, review or amendment of a disclosure statement and plan of reorganization; (c) negotiate with creditors and take the necessary legal steps to confirm and consummate a plan of reorganization; (d) prepare legal papers; (e) appear before the bankruptcy court; and (f) perform all other legal services for Debtor necessary for an effective reorganization. The firm's hourly billing rates are as follows: Lawrence F. Morrison $525 Brian J. Hufnagel $425 Associates $380 Paraprofessionals $200 The firm will also seek reimbursement for all out-of-pocket expenses incurred. On June 25, 2020, the firm received $12,000 as an initial retainer fee from Debtor. Lawrence Morrison, Esq., at Morrison Tenenbaum, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Lawrence F. Morrison, Esq. Brian J. Hufnagel, Esq. Morrison Tenenbaum PLLC 87 Walker Street, Floor 2 New York, NY 10013 Telephone: (212) 620-0938 Email: lmorrison@m-t-law.com bjhufnagel@m-t-law.com About Bulls Head Diner Bulls Head Diner, Inc., a classic Greek restaurant located in Stamford, Conn., filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 20-22807) on July 2, 2020, listing under $1 million in both assets and liabilities. Judge Robert D. Drain oversees the case. Lawrence F. Morrison, Esq., at Morrison Tenenbaum, PLLC, serves as Debtor's legal counsel. BYRD FAMILY: Proposes to Sell Lebanon Property for $800K -------------------------------------------------------- Judge Randal S. Mashburn of the U.S. Bankruptcy Court for the Middle District of Tennessee will consider Byrd Family Properties' sale of the real property at 507 S. Cumberland Street, Lebanon, Tennessee for $800,000, free and clear of all liens. An agreed order has been submitted resolving the Ascentium Capital, LLC objection, but it appears that there are potential problems with the sale that need to be addressed independent of Ascentium's objection. The Debtor's motion indicates that the sale price for the property is $800,000, but that the underlying debt owed to the first mortgage holder, Liberty State Bank, exceeds $4.4 million. The section of the Bankruptcy Code has five subsections providing the circumstances when a "free and clear" sale can occur. There is no indication in the motion that the secured creditor consents or will be paid in full at closing. Further there is no assertion that the lien is subject to a bona fide dispute or that non-bankruptcy law would permit the sale free and clear of liens. The only part of Section 363(f) referenced in the motion is the subsection that allows a sale where the holder of the lien could be compelled in a legal or equitable proceeding to accept a money satisfaction of such interest. The Debtor has cited no factual basis or legal framework to support the assertion. There may be grounds to justify that basis, but nothing in the Court record provides any explanation as to how that could be the case. To complicate things further, the Debtor and Ascentium have now submitted an agreed order that would allow for part of the proceeds from the sale of the real estate to be paid to Ascentium which asserts a lien in certain equipment or personal property -- but apparently does not assert a lien in the real estate. The Court will not enter the proposed agreed order between the Debtor and Ascentium pending the hearing set for Aug. 25, 2020. Further, regardless of whether Ascentium pursues the objection, the Debtor's counsel will be prepared at the hearing to explain the basis under Section 363(f) for approval of the sale. About Byrd Family Properties Based in Franklin, Tenn., Byrd Family Properties sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 20-03017) on July 19, 2020, listing under $1 million in both assets and liabilities. Judge Randal S. Mashburn oversees the case. Denis Graham (Gray) Waldron, Esq., at Dunham Hildebrand, PLLC, represents Debtor as legal counsel. Timothy Stone is the Subchapter V trustee in Debtor's bankruptcy case. CARR CREATIVE: Unsecureds to Split $12,000 Under Plan ----------------------------------------------------- Carr Creative Corporation, submitted a First Amended Plan of Reorganization. The Debtor's financial projections show that it is expected to generate average gross revenue of approximately $85,000 per month which is consistent with prepetition revenues, incur average operating expenses (exclusive of payments due under the Plan on account of restructured debt) of approximately $83,637 per month, and distribute under the Plan on account of Priority Claims and Secured Claims an average of approximately $1,138 per month during the 3-year period beginning on the date on which the first distribution is due under the Plan. Class 3 Secured Claim of Swift Financial (WebBank/PayPal) is impaired. The Claim of Swift Financial in the amount of $17,494 will be allowed as a fully Secured Claim and shall be paid in full with interest at 4% per annum in 36 equal monthly payments of $517 each. The first payment shall be due on the 1st day of the 1st full month following the Effective Date of the Plan and subsequent payments shall be due on the 1st day of each of the following 35 months. Class 4 Secured Claim of Celtic Bank Corp. (Bluevine) is impaired. The Claim of Celtic Bank/Bluevine in the amount of $68,447 will be allowed as a secured claim in the amount of $21,006, and as a General Unsecured Claim in the amount of $47,441. The Secured Claim in the amount of $21,006 will be paid in full with interest at 4% per annum in 36 equal monthly payments of $621 each. The first payment shall be due on the 1st day of the 1st full month following the Effective Date of the Plan and subsequent payments shall be due on the 1st day of each of the following 35 months. Class 5 Secured Claim of American Express. This class is impaired. This Claim of American Express in the amount of $119,447.90 shall be allowed as a General Unsecured Claim, and this Creditor shall have no Secured Claim. This unsecured Claim shall be included and treated in the class of General Unsecured Claims. Class 6 General Unsecured Claims are impaired. The Debtor's projected disposable income of the Debtor for the 3-year period beginning on the date on which the first distribution is due under the Plan is $8,113. The Debtor proposes to pay the amount of $12,000 to this Class, which shall be distributed on a pro-rata basis among the holders of the Allowed General Unsecured Claims in this class. Payments will be paid in 16 equal quarterly installments to each Creditor in this Class commencing on the earlier of January 15, April 15, July 15, or October 15 following the Effective Date and shall continue quarterly thereafter. All funds necessary for the implementation of this Plan will be obtained from funds in possession of the Debtor, generated by the business of the Debtor, derived from the liquidation of property of the estate, recovered or preserved as a result of the exercise of the Debtor's enforcement and/or avoiding powers retained and authorized under this Plan, or obtained by outside capitalization which shall be authorized by the Bankruptcy Court if necessary. A full-text copy of the First Amended Plan of Reorganization dated July 22, 2020, is available at https://tinyurl.com/yxwjb4lp from PacerMonitor.com at no charge. Attorneys for Carr Creative Corporation: Algernon L. Butler, III BUTLER & BUTLER, L.L.P. PO Box 38 Wilmington, NC 28402 Telephone: (910) 762-1908 Email: albutleriii@butlerbutler.com About Carr Creative Corporation Carr Creative Corporation sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C. Case No. 20-01078) on March 11, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $500,001 and $1 million. Judge David M. Warren oversees the case. Butler & Butler, L.L.P is the Debtor's legal counsel. CARVER GARDENS: S&P Cuts 2013A Housing Revenue Bond Rating to 'BB' ------------------------------------------------------------------ S&P Global Ratings lowered to 'BB' from 'BB+' its rating on Public Finance Authority, Wis.' series 2013A multifamily housing revenue bonds, issued for Carver Gardens LLC, Fla.'s Carver Gardens apartments project. The outlook is stable. The rating action reflects the implementation of S&P's criteria, titled "Methodology for Rating U.S. Public Finance Rental Housing Bonds". The rating is no longer under criteria observation. The rating action also reflects S&P's opinion of the project's low debt service coverage and liquidity reserves, coupled with its final management and governance assessment, which are, in S&P's view, weak and very weak, suggesting the obligor might not manage risks effectively. "We could lower the rating further if expenses were to increase without a commensurate increase in revenue, causing maximum annual debt service (MADS) coverage to decrease below 1.1x; if occupancy were to decrease significantly, causing vacancy losses to increase and financial performance to deteriorate; or our assessment of management and governance or market position were to weaken," said S&P Global Ratings credit analyst Emily Avila. "Although unlikely during the next 12 months, we could raise the rating if occupancy were to remain high, housing assistance payment revenue were to grow, and a MADS coverage trend above 1.25x were to emerge." The stable outlook reflects S&P's expectation occupancy will likely remain high and fiscal 2020 debt service coverage (DSC) will likely remain above 1.1x. S&P has analyzed the project's environmental, social, and governance (ESG) risks relative to DSC and liquidity, management and governance, and market position. It views the obligor's governance risk as higher than average compared with the sector based on its lack of risk-mitigation policies and superficial strategic plans, leaving the project vulnerable to operational volatility. Environmental risks are in line with sector standards because there are no elevated environmental threats present in the area. In S&P's view, health and safety concerns related to COVID-19, which it considers a social risk under its ESG factors, and what effect those risks will have on timely debt service payments will be minimal for subsidized affordable multifamily housing properties. Therefore, in S&P's opinion, the project's social risks are in line with sector standards. The authority issued the series 2013A bonds to facilitate Banyan Foundation Inc.'s acquisition and rehabilitation of a Section 8-enhanced apartment project, known as Carver Gardens, in Gainesville, Fla. Carver Gardens includes 11 two-story apartment buildings with 100 units. CELADON GROUP: Proposes $3.25M Settlement in Ch.11 Receivable Fight ------------------------------------------------------------------- Law360 reports that the trucking firm Celadon Group proposed a settlement July 21, 2020, in Delaware bankruptcy court under which it would make $3.25 million in payments to resolve an ongoing dispute in its Chapter 11 case involving more than $6 million of receivables held by the debtor. In court filings, Celadon said it would transfer $3.25 million in cash to TA Dispatch LLC, which purchased certain assets of the debtor in 2019, to resolve the ongoing fight over accounts receivable collected by Celadon on behalf of TA Dispatch after the sale, but before the bankruptcy filing. About Celadon Group Celadon Group, Inc. -- https://celadontrucking.com/ -- is a North American truckload freight transportation company, primarily providing point-to-point shipping, warehousing, supply chain logistics, tractor leasing and other transportation and logistics services for major customers throughout North America. Celadon Group and 25 affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-12606) on Dec. 8, 2019. As of Dec. 2, 2019, the Debtors disclosed $427 million in assets and $391 million in liabilities. Judge Karen B. Owens oversees the cases. The Debtors tapped DLA Piper LLP (US) as bankruptcy counsel; Scudder Law Firm, P.C., L.L.O. as special counsel; Alixpartners, LLP as financial advisor; and Kurtzman Carson Consultants, LLC, as notice, claims and balloting agent and administrative advisor. CHAMBERLAIN FAIRVIEW: Plan of Reorganization Confirmed by Judge --------------------------------------------------------------- Judge Jeffery A. Deller has entered an order approving the Disclosure Statement and confirming the Plan of Reorganization of debtor Chamberlain Fairview Farm. The Plan of Reorganization dated as of June 16, 2020, as amended by the Stipulation, is in accord with the terms, condition, and provisions of the Code, including but not limited to Section 1129 thereof, is proposed in good faith, and is feasible and confirmable. The stipulation as to the treatment of the claim of Farmers and Merchants Trust Company of Chambersburg, shall govern the treatment of the claim of Farmers and Merchants Trust Company of Chambersburg notwithstanding any provision in the Plan which may provide for alternate treatment of the claim. A copy of the order dated July 21, 2020, is available at https://tinyurl.com/y65awwsv from PacerMonitor at no charge. About Chamberlain Fairview Farm Chamberlain Fairview Farm owns and operates a dairy farm in Clearville, Pa. Chamberlain Fairview Farm filed a voluntary Chapter 11 petition (Bankr. W.D. Pa. Case No. 19-70757) on Dec. 17, 2019. In the petition signed by Lynn E. Chamberlain, general partner, the Debtor reported $1,438,190 in assets and $1,127,923 in liabilities. The Debtor tapped Kevin J. Petak, Esq., at Spence, Custer, Saylor, Wolfe & Rose, LLC, as legal counsel; and Dunkle Services as accountant. CHAPARRAL ENERGY: Hires Opportune LLP as Restructuring Advisor -------------------------------------------------------------- Chaparral Energy, Inc. and affiliates seek approval from the U.S. Bankruptcy Court for the District of Delaware to employ Opportune LLP as their restructuring advisor. The firm will render these services: (a) General Reorganization Efforts: (i) Assistance with the preparation of financial and other information for distribution to stakeholders and others; (ii) Analysis of proposed transactions; (iii) Assistance with the identification and implementation of short-term cash management procedures; (iv) Assistance to management, counsel, and other advisors focused on the coordination of resources related to ongoing reorganization efforts; (v) Attendance at meetings and assistance in discussions with potential investors, banks, other secured lenders, any committees, and other stakeholders and assistance with respect to due diligence requests from the same; (vi) Certain tax advisory services; (vii) Assistance with customer, supplier and vendor management and negotiations; (viii) Certain fresh start accounting and valuation services; and (ix) Other general financial and restructuring advisory services as mutually agreed by the Company and Opportune. (b) Bankruptcy Advisory Services: (i) Assistance in the preparation of bankruptcy documents; (ii) Development of forecasts and information for obtaining bankruptcy court approval of use of cash collateral or debtor-in-possession (DIP) financing and related compliance reporting; (iii) Assistance in the preparation of financial related disclosures required by the Court; (iv) Assistance in the preparation of financial information; (v) Assistance with developing a customer, supplier and vendor management process; (vi) Assistance with respect to mortgages and lien perfections; (vii) Assistance with the identification of executory contracts and leases and performance of cost/benefit evaluations with respect to the affirmation or rejection of each; (viii) Analysis of creditor claims by type, entity, and individual claim; (ix) Assistance in the preparation of information and analysis necessary for the confirmation of a plan of reorganization in such chapter 11 proceeding(s); (x) Assistance in the analysis or preparation of information necessary to assess the tax attributes related to the confirmation of a plan of reorganization in these chapter 11 cases; (xi) Litigation advisory services with respect to accounting and tax matters; (xii) Expert witness testimony on case related issues; (xiii) Ongoing support with respect to managing the day-to-day requirements of the bankruptcy process; and (xiv) Rendering such other general financial, restructuring, and business consulting or such other assistance management or counsel may deem necessary consistent with the role of a financial and operational advisor to the extent that it would not be duplicative of services provided by other professionals in such proceeding. The hourly rates charged by the firm's professionals are as follows: Managing Partner $1,150 Partner $1,050 Managing Directors $875 Directors $775 Managers $685 Senior Consultants $515 Consultants $450 Administrative Professional $275 In addition, Debtors have agreed to reimburse Opportune for work-related expenses incurred. Prior to the petition date, Opportune received advance payment retainer totaling $200,000. John Echols, Esq., a partner at Opportune, disclosed in court filings that the firm is a "disinterested person" as defined in Sections 101(14) and 327(a) of the Bankruptcy Code. The firm can be reached through: John Echols Opportune LLP 711 Louisiana, Suite 3100 Houston, TX 77002 Telephone: (713) 490-5050 Email: jechols@opportune.com About Chaparral Energy Chaparral Energy, Inc. is an independent oil and natural gas exploration and production company headquartered in Oklahoma City. Founded in 1988, Chaparral Energy is focused in the oil window of the Anadarko Basin in the heart of Oklahoma. Visit http://www.chaparralenergy.comfor more information. On Aug. 16, 2020, Chaparral Energy and its debtor affiliates filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-11947). Charles Duginski, chief executive officer, signed the petitions. At the time of the filing, Debtors disclosed total assets of $595,167,000 and total liabilities of $522,288,000 as of June 30, 2020. Judge Mary F. Walrath oversees the cases. Debtors have tapped Davis Polk & Wardwell LLP and Richards, Layton & Finger, P.A. as counsel, Intrepid Partners, LLC as investment banker, Rothschild & Co. as financial advisor, and Opportune LLP as restructuring advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent. CHAPARRAL ENERGY: Taps Kurtzman Carson as Administrative Advisor ---------------------------------------------------------------- Chaparral Energy, Inc. and affiliates seek approval from the U.S. Bankruptcy Court for the District of Delaware to employ Kurtzman Carson Consultants, LLC as administrative advisor. The firm will render these bankruptcy administrative services: (a) assist in the preparation of Debtors' bankruptcy schedules and statements of financial affairs; (b) assist in the solicitation, balloting, tabulation and calculation of votes, and in the preparation of reports in support of Debtors' Chapter 11 plan; (c) prepare an official ballot certification and testify, if necessary, in support of the ballot tabulation results; and (d) prepare claims objections and exhibits, and assist with claims reconciliation and related matters. The firm's hourly rates for its consulting services are as follows: Analyst $27.00 - $45.00 Technology/Programming Consultant $31.50 - $85.50 Consultant/Senior Consultant/ Senior Managing Consultant $63.00 - $175.50 Securities/Solicitation Consultant $184.50 Securities Director/Solicitation Lead $193.50 In addition, the firm will seek reimbursements for all out-of-pocket expenses incurred. Prior to the petition date, Debtors provided the firm a retainer in the amount of $45,000. Robert Jordan, a senior managing director at Kurtzman Carson, disclosed in court filings that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Robert Jordan Kurtzman Carson Consultants, LLC 222 N. Pacific Coast Highway, 3rd Floor El Segundo, CA 90245 Telephone: (310) 823-9000 Facsimile: (310) 823-9133 About Chaparral Energy Chaparral Energy, Inc. is an independent oil and natural gas exploration and production company headquartered in Oklahoma City. Founded in 1988, Chaparral Energy is focused in the oil window of the Anadarko Basin in the heart of Oklahoma. Visit http://www.chaparralenergy.comfor more information. On Aug. 16, 2020, Chaparral Energy and its debtor affiliates filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-11947). Charles Duginski, chief executive officer, signed the petitions. At the time of the filing, Debtors disclosed total assets of $595,167,000 and total liabilities of $522,288,000 as of June 30, 2020. Judge Mary F. Walrath oversees the cases. Debtors have tapped Davis Polk & Wardwell LLP and Richards, Layton & Finger, P.A. as counsel, Intrepid Partners, LLC as investment banker, Rothschild & Co. as financial advisor, and Opportune LLP as restructuring advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent and administrative advisor. CHAPARRAL ENERGY: Taps Rothschild, Intrepid as Investment Bankers ----------------------------------------------------------------- Chaparral Energy, Inc. and affiliates seek approval from the U.S. Bankruptcy Court for the District of Delaware to employ Rothschild & Co US Inc. and Intrepid Partners, LLC as investment bankers. The firms will render these services: (a) identify or initiate potential transactions; (b) review and analyze Debtors' assets and operating and financial strategies; (c) review and analyze the business plans and financial projections prepared by Debtors; (d) evaluate Debtors' debt capacity in light of their projected cash flows and assist in the determination of an appropriate capital structure for Debtors; (e) assist Debtors and their other professionals in reviewing the terms of any proposed transaction, in responding thereto and, if directed, in evaluating alternative proposals for a transaction; (f) determine a range of values for Debtors and any securities that they offer or propose to offer in connection with a transaction; (g) advise Debtors on the risks and benefits of considering a transaction with respect to their intermediate and long-term business prospects and strategic alternatives to maximize their business enterprise value; (h) review and analyze any proposals the Debtors receive from third parties in connection with a transaction; (i) assist or participate in negotiations; (j) attend meetings of Debtors' board of directors, creditor groups, official constituencies and other interested parties; (k) if requested by Debtors, participate in hearings before the court and provide relevant testimony; (l) assist Debtors in raising new debt or equity; and (m) render such other financial advisory and investment banking services as may be agreed upon by the investment bankers and Debtors. Rothschild & Co and Intrepid will be jointly entitled to the following fees: (a) An advisory fee of $150,000 per month. (b) A one-time fee of $4 million. (c) A new capital fee equal to (i) 1 percent of the face amount of any senior secured debt raised; (ii) 3 percent of the face amount of any junior secured or senior or subordinated unsecured debt raised and (iii) 5 percent of any equity capital, capital convertible into equity or hybrid capital raised. (d) The investment bankers shall credit against the completion fee: (a) 50 percent of the monthly fees paid in excess of $500,000 and (b) 50 percent of any new capital fees paid, provided that the sum of any new capital fee credit and the monthly fee credit shall not exceed the completion Fee. In addition, the firms will charge Debtors for out-of-pocket expenses incurred. Prior to the petition date, Rothschild & Co received from Debtors fee payments totaling $435,000 and expense reimbursements totaling $24,009. Meanwhile, Intrepid received fee payments totaling $300,000 and expense reimbursements totaling $406.07 during the 90 days immediately preceding the petition date. Kevin Glodowski, a managing director at Rothschild & Co, and David Gehring, a managing director at Intrepid Partners, disclosed in court filings that the firms are "disinterested persons" as defined in Section 101(14) of the Bankruptcy Code. The firms can be reached through: Kevin Glodowski Rothschild & Co US Inc. 1251 Avenue of the Americas New York, NY 10020 Telephone: (212) 403-3500 - and – David R. Gehring Intrepid Partners, LLC 1201 Louisiana Street, Suite 600 Houston, TX 77002 Telephone: (713) 292-0863 Facsimile: (281) 582-7298 About Chaparral Energy Chaparral Energy, Inc. is an independent oil and natural gas exploration and production company headquartered in Oklahoma City. Founded in 1988, Chaparral Energy is focused in the oil window of the Anadarko Basin in the heart of Oklahoma. Visit http://www.chaparralenergy.comfor more information. On Aug. 16, 2020, Chaparral Energy and its debtor affiliates filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-11947). Charles Duginski, chief executive officer, signed the petitions. At the time of the filing, Debtors disclosed total assets of $595,167,000 and total liabilities of $522,288,000 as of June 30, 2020. Judge Mary F. Walrath oversees the cases. Debtors have tapped Davis Polk & Wardwell LLP and Richards, Layton & Finger, P.A. as counsel, Intrepid Partners, LLC as investment banker, Rothschild & Co. as financial advisor, and Opportune LLP as restructuring advisor. Kurtzman Carson Consultants LLC is the claims and noticing agent and administrative advisor. CHESAPEAKE ENERGY: Seeks to Cancel $300M Energy Transfer Contract ----------------------------------------------------------------- Laila Kearney at Reuters reports that U.S. energy regulators sided with pipeline operator Energy Transfer in a challenge to bankrupt oil and gas producer Chesapeake Energy's request to cancel a nearly $300 million contract, court filings show. Chesapeake ignited a fight when it asked the U.S. Bankruptcy Court in Houston to approve breaking pipeline contracts, including with Energy Transfer and Crestwood Equity Partners. The Federal Energy Regulatory Commission (FERC) in a filing late August argued that it should have equal say with the bankruptcy court over regulated pipeline contracts. FERC recently sought to have its voice included in contract disputes including with bankrupt utility PG&E Corp. "(A)ny court that decides the debtors' (Chesapeake's) motion to reject will have to consider the intersection of the bankruptcy code and non-bankruptcy federal law," said U.S. Attorney Ryan Patrick, who is representing FERC in the case. Energy Transfer wants to keep its contract, insisting it is more complex than many canceled in bankruptcy courts in the past. It also has won Trump administration support for its fight to continue its Dakota Access crude oil pipeline. Company chief Kelsey Warren has been a donor to the president. Chesapeake, the largest oil and gas producer to file for protection from creditors in at least five years, wants to rid itself of $7 billion in debt and expenses including the pipeline contracts. Pipeline operator Tallgrass Energy separately has sought to prevent bankrupt Ultra Petroleum from cancelling a contract. It has asked FERC to intervene on cancellation of pipeline contracts through bankruptcies. "It fundamentally comes down to an argument that these contracts have unique aspects and that FERC is the one that can tell the difference," said Rick Smead, managing director for advisory services at RBN Energy. The Ultra Petroleum decision is expected to land first and could have implications for many other contract rejection legal disputes in the future, Smead said. About Chesapeake Energy Headquartered in Oklahoma City, Chesapeake Energy Corporation's (NYSE: CHK) operations are focused on discovering and developing its large and geographically diverse resource base of unconventional oil and natural gas assets onshore in the United States. Chesapeake Energy reported a net loss of $308 million for the year ended Dec. 31, 2019. As of Dec. 31, 2019, the company had $16.19 billion in total assets, $2.39 billion in total current liabilities, $9.40 billion in total long-term liabilities, and $4.40 billion in total equity. Chesapeake Energy and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33233) on June 28, 2020, after reaching terms of a Chapter 11 plan of reorganization to eliminate approximately $7 billion of debt. The Debtors tapped Kirkland & Ellis LLP as legal counsel, Jackson Walker LLP as co-counsel and conflicts counsel, Alvarez & Marsal as restructuring advisor, Rothschild & Co and Intrepid Financial Partners as financial advisors, and Reevemark as communications advisor. Epiq Global is the claims agent, maintaining the page http://www.chk.com/restructuring-information. Wachtell, Lipton, Rosen & Katz serves as legal counsel to Chesapeake Energy's Board of Directors. MUFG Union Bank, N.A., the DIP facility agent and exit facilities agent, has tapped Sidley Austin LLP as legal counsel, RPA Advisors LLC as financial advisor, and Houlihan Lokey Capital Inc. as investment banker. Davis Polk & Wardell LLP and Vinson & Elkins L.L.P. serve as legal counsel to an ad hoc group of first lien last out term loan lenders while Perella Weinberg Partners and Tudor, Pickering, Holt & Co. serve as the group's investment bankers. Franklin Advisers, Inc., has tapped Akin Gump Strauss Hauer & Feld LLP as legal counsel, FTI Consulting, Inc. as financial advisor, and Moelis & Company LLC as investment banker. On July 9, 2020, the Office of the U.S. Trustee appointed a committee to represent unsecured creditors in Debtors' Chapter 11 cases. The unsecured creditors' committee has tapped Brown Rudnick, LLP and Norton Rose Fulbright US, LLP as its legal counsel, and AlixPartners, LLP as its financial advisor. On July 24, 2020, the bankruptcy watchdog appointed a committee of royalty owners. The royalty owners' committee is represented by Forshey & Prostok, LLP. CHF CHICAGO: S&P Cuts 2017A, 2017B Revenue Bond Ratings to 'BB' --------------------------------------------------------------- S&P Global Ratings lowered its long-term rating two notches to 'BB' from 'BBB-' on the Illinois Finance Authority's series 2017A tax-exempt and 2017B taxable student housing revenue bonds issued for CHF Chicago LLC, a not-for-profit corporation organized for the sole purpose of financing the construction of an integrated academic and housing space. The outlook is negative. "The rating action reflects our view that though the project is estimated to open in fall 2020 at a 95% occupancy, it experienced a substantial decline in the preleasing rates due to a wave of cancellations associated with the ongoing global pandemic," said S&P Global Ratings analyst Gauri Gupta. The project opened on Aug. 24, 2020, with a 53% occupancy and the final census date is Sept. 4, so it could change. Therefore, the project will face operating pressures due to loss of rental revenues. "The negative outlook reflects our view of the project's narrow revenue stream and the uncertainties surrounding the ultimate economic fallout related to the COVID-19 pandemic," added Ms. Gupta. "It reflects our belief that all projects in the sector are facing negative economic or fundamental business conditions that could result in further rating action." S&P could lower the rating if the project continues to experience lower-than-targeted occupancy such that net project operating revenues are insufficient to meet covenant debt service coverage. In addition, the rating agency might consider a downgrade if the campus experiences significant declines in undergraduate enrollment, housing demand, or occupancy. In S&P's view, privatized student housing projects face elevated social risk due to the uncertainty regarding the duration of the COVID-19 pandemic, and the unknown effects on fall 2020 enrollment and occupancy levels. S&P views the risks posed by COVID-19 to public health and safety as a social risk under its environmental, social, and governance (ESG) factors. Despite the elevated social risk, S&P believes CHF-Chicago's environment and governance risk are in line with its view of the sector as a whole. CIGAR BROTHERS: 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 Cigar Brothers LLC, according to court dockets. About Cigar Brothers Cigar Brothers, LLC, filed a Chapter 11 bankruptcy petition (Bankr. M.D. Fla. Case No. 20-05599) on July 23, 2020, disclosing under $1 million in both assets and liabilities. Judge Catherine Peek Mcewen oversees the case. The Debtor is represented by David W. Steen, P.A. CINEMEX USA: Oct. 1 Auction of Substantially All Assets Set ----------------------------------------------------------- Judge Laurel M. Isicoff of the U.S. Bankruptcy Court for the Southern District of Florida authorized the bidding procedures proposed by Cinemex USA Real Estate Holdings, Inc. and its affiliates in connection with the auction sale of substantially or all of their assets. A hearing on the Motion was held on Aug. 29, 2020, at 9:30 a.m. The salient terms of the Bidding Procedures are: a. Bid Deadline: Sept. 30, 2020 at 5:00 p.m. (ET) b. Initial Bid: The initial Overbid, if any, will provide for total consideration (consisting of cash, cures and capital expenditure commitments under any assumed lease) to the Debtors of an aggregate value that exceeds the value of the consideration under the Starting Bid by an incremental amount that is not less than the sum of (i) 1% of the total consideration, plus (ii) in the event that the Debtors have entered into a Stalking Horse Agreement with respect to the Assets to which the Overbid relates, the aggregate amount of Bid Protections if any (including, for the avoidance of doubt, any break-up fees and/or expense reimbursements) under such Stalking Horse Agreement, and each successive Overbid will exceed the then-existing Overbid by an incremental amount that is not less than the Minimum Overbid Increment. Additional consideration in excess of the amount set forth in the respective Starting Bid may include (a) cash and/or non-cash consideration. c. Deposit: 10% of the purchase price contained in the Modified PSA d. Auction: If two or more Qualified Bids for the same Assets are received by the Bid Deadline, the Debtors will conduct the Auction virtually with respect to such Assets on Oct. 1, 2020 at 1:30 p.m. (ET). If fewer than two Qualified Bids are received by the Bid Deadline with respect to any portion of the Assets, the Debtors will not conduct the Auction with respect to such Assets. If only one Qualified Bid is received with respect to all or a portion of the Assets, the Debtors may designate such Qualified Bid as the Successful Bid(s). e. Bid Increments: 1% of the total consideration f. Sale Hearing: Oct. 14, 2020 at 10:00 a.m. (ET) g. Sale Objection Deadline: Oct. 9, 2020 The Debtors are authorized to enter into a Stalking Horse Agreement, which may, with the consent of the Committee, provide for payment of break-up fees of up to 3% of the purchase price and/or expense reimbursements of up to 1.5% of the purchase price, as set forth in the Bidding Procedures, subject to entry of an order approving the selection of the Stalking Horse Bidder and any applicable Bid Protections as provided. No bid protections will be provided if the Stalking Horse Bidder is an insider or affiliate of the Debtors, absent Court approval upon notice and hearing. In the event that the Debtors, in accordance with the Bidding Procedures, select one or more parties to serve as a Stalking Horse Bidder, upon such selection, the Debtors will file with the Court and provide, to all interested parties five business days' notice of and an opportunity to object to the designation of such Stalking Horse Bidder and the Bid Protections set forth in the Stalking Horse Agreement and absent objection, the Debtors may submit an order to the Court under certification of counsel approving the selection of such Stalking Horse Bidder and the Bid Protections. The form of Sale Notice is approved. Within three business days after the entry of the Order, the Debtors will serve the Sale Notice and the Order, including the Bidding Procedures, upon the Notice Parties. The form of Post-Auction Notice is approved. Within one day after the conclusion of the Auction, if any, the Debtors will (a) file the Post-Auction Notice identifying any Successful Bidder(s) on the Court's docket, (b) to the extent that any non-Debtor party to an executory contract or unexpired lease that is proposed to be assumed and assigned to the Successful Bidder(s) has not filed a notice of appearance on the docket in these chapter 11 cases, serve the Post-Auction Notice on such parties, and (c) provide to all counter-parties to the Designated Contracts who have executed a Lessor NDA, the Adequate Assurance Information4 for the Successful Bidder and Backup Bidder. The Assumption and Assignment Procedures are approved to the extent not modified by the Order or the Assumption Notice. The Assumption Notice is approved. On Sept. 11, 2020, the Debtors will (a) file with the Court the Assumption Notice and Designated Contracts List, and (b) provide to all counter-parties to the Designated Contracts who have executed a Lessor NDA, the Adequate Assurance Information for the Stalking Horse Bidder. The Contract Objection Deadline is Sept. 28, 2020. Notwithstanding Bankruptcy Rules 6004(h), 6006(d), 7062, 9014, or otherwise, the Court, for good cause shown, orders that the terms and conditions of the Order will be immediately effective and enforceable upon its entry. A copy of the Bidding Procedures and the Notices is available at https://tinyurl.com/y4v4woxh from PacerMonitor.com free of charge. About Cinemex Cinemex USA Real Estate Holdings Inc. and Cinemex Holdings USA, Inc., a company that operates a movie theater chain, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case Nos. 20-14695 and 20-14696) on April 25, 2020. On April 26, 2020, CB Theater Experience, LLC filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 20-14699). The cases are jointly administered under Case No. 20-14695. At the time of the filing, Debtors each disclosed assets of between $100 million and $500 million and liabilities of the same range. The Debtors tapped Quinn Emanuel Urquhart & Sullivan, LLP and Bast Amron, LLP as bankruptcy counsel; Province, Inc. as financial advisor; and Omni Agent Solutions as noticing, balloting and administrative agent. The U.S. Trustee for Region 21 appointed a committee of unsecured creditors. The committee is represented by Pachulski Stang Ziehl & Jones, LLP and Berger Singerman, LLP. CNX RESOURCES: S&P Alters Outlook to Stable, Affirms 'B+' ICR ------------------------------------------------------------- S&P Global Ratings revised its outlook on U.S.-based exploration and production (E&P) company CNX Resources Corp. to stable from negative and affirmed its 'B+' issuer credit rating on the company. S&P expects credit measures to gradually improve through 2021, with funds from operations (FFO) to debt in the 25%-30% range and debt to EBITDA around 3x. Although S&P expects production to decrease in 2020 as the company shut off some wells in response to lower demand, the rating agency expects production to increase by about 10% in 2021 as CNX turns those wells back on. Free cash flow generation is supported by proceeds from tax refunds in 2020, and by S&P's expectation of much lower capital spending (about $500 million annually). S&P notes that CNX has almost all of its expected gas production in 2020 and 80% of its 2021 volumes hedged at favorable prices, which provides strong protection to cash flows. Risks to S&P's forecasts include higher level of spending or a more shareholder-oriented financial policy. "We believe CNX will be able to repay or refinance its remaining 2022 debt maturity," S&P said. After applying proceeds from a convertible notes issuance to repaying its 2022 senior notes, about $414 million is left due as of end of July 2020. S&P expects the company to use proceeds from tax refunds to further repay these notes. The remaining amount will be very manageable given S&P's forecasts of positive free cash flow of $200 million to $400 million annually over the next couple of years. In addition, the company could access capital markets if needed as market conditions have markedly improved since April. Finally, CNX has sufficient credit facility availability that it could use for refinancing in the event that capital markets remain closed. "The stable outlook reflects our expectation that FFO to debt will approach 30% in 2021 and that the company will generate sufficient free cash flow in the next two years to repay its remaining 2022 debt maturities, or could access capital markets to refinance them," S&P said. S&P could lower the issuer credit rating if it forecasts CNX's leverage will weaken over the next two years, such that projected FFO to debt approaches 20% and debt to EBITDA approaches 4x on a sustained basis. This could happen if drilling costs exceeded expectations, or if gas price realizations deteriorate. Gas production growth relative to pipeline capacity in the Appalachian region is a key factor in determining realized prices and transportation costs, which can be large factors in CNX's profitability. An upgrade would require stronger leverage measures, including projected FFO to debt well above 30% and debt to EBITDA well below 3x on a sustained basis. The company could achieve these credit measures if it meets its natural gas production targets while containing costs, capital spending, and achieving improved gas price realizations. COLDWATER CREEK: Says It's Time to Say Goodbye ---------------------------------------------- Marianne Wilson, writing for Chain Store Age, reports that Coldwater Creek is holding a sale -- a big sale -- amid strong signs that it may be going out of business. The struggling women's apparel retailer is holding a 70%-off everything sale on its Web site, with all sales final. The new Coldwater Creek catalog is offering the same promotion. "It's time to say goodbye," the retailer states on its e-commerce site. "Every brand has a story and ours has taken an unexpected turn." "We may be saying goodbye before too long so we're taking 70% off everything. Thanks for being part of our family & history." Founded in 1984 as a catalog retailer, Coldwater Creek went on to open stores nationwide. The company filed for Chapter 11 bankruptcy in spring 2014 with plans to liquidate and close its more than 300 stores. Sycamore Partners subsequently acquired the Coldwater Creek brand and other intellectual property and relaunched the business as a direct-to-consumer brand. It re-entered physical space in 2017, opening a store in Burlington, Mass. Coldwater Creek has 13 stores, all of which were shuttered due to the pandemic. As of July 20, the stores are all marked "temporarily closed" on the company’s website. About Coldwater Creek Coldwater Direct LLC or Coldwater Creek is an American catalog and online retailer of women's apparel, accessories and home decor with six brick-and-mortar stores as of December 2018. CONFIE SEGUROS: S&P Affirms 'B-' ICR & Alters Outlook to Negative ----------------------------------------------------------------- S&P Global Ratings affirmed its 'B-' long-term issuer credit rating on personal lines nonstandard auto insurance broker Confie Seguros Holding Co. (Confie). S&P removed the rating from CreditWatch, where the rating agency placed it with negative implications on April 20. The outlook is negative. S&P also affirmed and removed from CreditWatch negative the 'B-' rating on Confie's first-lien credit facility and its 'CCC' rating on Confie's $220 million second-lien term loan. The recovery rating on the first-lien facility remains '3', indicating S&P's expectation for meaningful recovery (60%-65%; rounded estimate: 60%) in the event of a payment default. The recovery rating on the second-lien term loan remains '6', indicating S&P's expectation for negligible (0%-10%; rounded estimate: 0%) recovery in the event of a payment default. The affirmation reflects Confie's stronger-than-anticipated performance in the second quarter. Despite unemployment peaking above 15% in May and the expected adverse impact on the nonstandard auto market, Confie's top-line revenue only declined about 6%. The company has focused on improving customer experience in recent years, which, coupled with government intervention such as stimulus payments and enhanced unemployment benefits, led to resilient retention levels. Confie was also able to transition more business to its telesales platform with the country under shelter-in-place restrictions and customers less likely to visit brick-and-mortar stores. Additionally, aggressive cost management led to a $3.7 million increase in reported EBITDA for the second quarter in 2020 versus the same quarter last year. With cost cutting such as reduced hours for support staff, reducing capital expenditure spending, and reducing marketing spending, Confie was able to reduce expenses by approximately $12 million. The negative outlook reflects the pressure on the sector because of macroeconomic uncertainty, which is highly correlated to premium and ultimately commission volumes. Given Confie's monoline focus on distributing nonstandard auto insurance to the underserved community, Confie is exposed to even greater revenue variability from higher unemployment. Furthermore, Confie has already taken aggressive cost-saving measures, so if another shelter-in-place restriction were to occur, it would have less options available to reduce expenses in reaction to economic stresses. The broker saw a reduction in new auto policy sales in the last half of March as shelter-in-place mandates began rolling out and continued though the end of May. However, once the government stimulus was distributed toward the end of April and states started to loosen shelter-in-place restrictions in the beginning of May, policies in force for both the retail and Managing General Agency (MGA) business started to grow and gained some momentum into the beginning of the third quarter. S&P still sees significant uncertainty in the length and stability of the economic recovery across the insurance broker market as lower activity reduces insured exposures. Confie is exposed to revenue variability from consumers temporarily not purchasing auto insurance in reaction to loss of employment in an effort to reduce expenses. There is risk that lost jobs will be permanent and unemployment rates will plateau well above those from before the pandemic. The Federal stimulus offset some of the decline in the second quarter, but there's still uncertainty as to what the impact could be if there isn't a second round of government support. S&P anticipates top-line revenue to gradually improve in the third quarter and reach near pre-pandemic levels in the fourth quarter, finishing the year down 3%-5% on a consolidated basis. If the fallout from COVID-19 restrictions were to extend past its assumed timeline, S&P believes Confie is at risk of approaching a breach of the terms of its first-lien covenant (5.5x net leverage ratio). As of June 30, 2020, the covenant cushion was near 15% and potentially could decline in light of continued challenging macro-economic conditions. Therefore, if the economic fallout drags out through the end of the year, worsening S&P's earnings expectations, the company could begin to face first-lien covenant pressures. S&P expects business revenues to decline but margins to remain 26%-28% given expense reductions. S&P expects leverage to be a high 10.x-10.5x (7.5x-8.0x excluding the preferred shares the rating agency treats as debt), with coverage of 1.x-1.5x and cash coverage of about 2.0x. "We view Confie's liquidity as less than adequate to support its operating needs, given its EBITDA cushion relative to its first-lien covenants. Confie has continued to generate cash through COVID-19 and has reduced its revolver borrowings since March by $10 million due to the increased liquidity position," S&P said. "We believe the company can withstand current severe adverse market circumstances over the next 12 months while maintaining sufficient liquidity to meet its obligations, partly because debt maturities are minimal. But if the lost production does not stabilize by June, this could worsen and potentially cause a breach of the first-lien covenant. We expect sources to exceed uses by at least 1.2x and net sources to remain positive," the rating agency said. The negative outlook reflects the heightened risk of a worse-than-expected revenue decline amid the economic fallout of the COVID-19 pandemic, resulting in a potential covenant breach if EBITDA were to drop over 10% and an capital structure were to become unsustainable (such as leverage above 10x excluding preferred stock treated as debt). S&P believes uncertainty in unemployment rates in the U.S. and the level of insured exposures could strain financial metrics over the next 12 months. "We could lower our ratings within 12 months if financial leverage, excluding preferred shares treated as debt, rises above 10x or if EBITDA falls to a point where the cushion on the first-lien covenant is below 5%. Revenue contraction beyond 15% or lack of margin expansion would likely cause such an outcome," S&P said. "We could revise the outlook to stable if Confie continues improving organic revenue growth and sees stronger EBITDA margins near 26%-28% over the next 12 months. We believe recovery in the second half of 2020 despite economic uncertainty would lead to a covenant cushion sustainably above 10% on the first-lien term loan," the rating agency said. CORT & MEDAS: Oct. 22 Auction of 2 Brooklyn Properties Set ---------------------------------------------------------- Judge Carla E. Craig of the U.S. Bankruptcy Court for the Eastern District of New York authorized Cort & Medas, LLC's sale of the real properties known as and located at 1376 and 1414 Utica Avenue, Brooklyn, New York, Block 4784, Lots 20 and 35 at a public auction and pursuant to the relevant terms of the Plan, free and clear of all Liens, with such Liens attaching to the sale proceeds. Any other relief sought in the Motion not granted by the Order will be considered at the hearing scheduled to approve the results of the Auction to be held by the Court on Oct. 28, 2020 at 2:00 p.m. (CEC). The Terms and Conditions of Sale are approved in all respects. The Auction will be conducted telephonically or by videoconference on Oct. 22, 2020, or such other adjourned date posted on the website maintained by Rosewood Realty Group, the Debtor's auctioneer, and that the Properties will be offered for inspection by appointment at reasonable times, requested by the interested party to the Debtor's auctioneer, which will make such arrangements. The Notice of Sale is approved in all respects. Within three business days after entry of the Order, the Debtor will serve a copy of the Notice of Sale upon the Notice Parties. Within 48 hours after the conclusion of the Auction, or the execution of a contract of sale with one or more purchasers for the Properties, the Debtor will file a Sale Declaration with the Court regarding the results of the Auction. Objections, if any, to that part of the relief sought in the Motion not otherwise approved by the Order, including the Sale of the Properties free and clear of liens, will be filed with the Bankruptcy Court by Oct. 26, 2020 at 4:00 p.m. Within three business days of the entry of the Order, the Debtor will serve a copy of the Order upon (i) the United States Trustee; (ii) all creditors listed on its bankruptcy petition and/or that have filed proofs of claim in its case; (iii) all parties having requested notices in its case; and (iv) all appropriate taxing authorities, and file an affidavit evidencing service no later than the filing of the Sale Declaration. The Debtor will have the right to cancel or adjourn the Auction in the event that a plan is confirmed in the case providing for a refinancing of its secured creditors prior to the date of the Auction. A copy of the Bidding Procedures is available at https://tinyurl.com/yac53bqt from PacerMonitor.com free of charge. About Cort & Medas Associates Cort & Medas Associates, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 19-41313) on March 6, 2019. At the time of the filing, the Debtor was estimated to have assets and liabilities of between $1 million and $10 million. The case is assigned to Judge Carla E. Craig. Shafferman & Feldman LLP is the Debtor's legal counsel. DEAN FOODS: Court Approves Property Insurance Coverage Reduction ---------------------------------------------------------------- Leslie A. Pappas, writing for Bloomberg Law, reports that Dean Foods Co. gained court approval to pare down insurance coverage on its remaining properties as it winds down its bankruptcy, overcoming a federal bankruptcy watchdog's objection that lack of insurance would put the estate at risk. The U.S. Bankruptcy Court for the Southern District of Texas found Dean Foods' request to be "in the best interest" of the debtors, creditors, and the estate. The bankrupt food and beverage producer had asked the court for permission to waive certain insurance guidelines found in local bankruptcy rules. About Dean Foods Southern Foods Group, LLC, d/b/a Dean Foods, is a food and beverage company and a processor and direct-to-store distributor of fresh fluid milk and other dairy and dairy case products in the United States. The Company and its 40+ affiliates filed for bankruptcy protection on Nov. 12, 2019 (Bankr. S.D. Tex. Lead Case No. 19-36313). The petitions were signed by Gary Rahlfs, senior vice president and chief financial officer. Dean Foods was estimated to have assets and liabilities of $1 billion to $10 billion as of the bankruptcy filing. Judge David Jones oversees the cases. David Polk & Wardell LLP serves as general bankruptcy counsel to the Debtors, and Norton Rose Fulbright US LLP serves as local counsel. Alvarez Marsal is financial advisor to the Debtors, Evercore Group LLC is investment banker, and Epiq Corporate Restructuring LLC is notice and claims agent. DEAN FOODS: U.S. Trustee Says It Must Keep Casualty Insurance ------------------------------------------------------------- Leslie A. Pappas, writing for Bloomberg News, reports that Dean Foods Co. shouldn't be allowed to forgo property casualty insurance coverage as it winds down its bankruptcy, the Justice Department’s bankruptcy watchdog says. "Maintaining appropriate casualty insurance is a fundamental aspect of a debtor-in-possession's fiduciary duty," the U.S. Trustee said in an objection filed Monday with the U.S. Bankruptcy Court for the Southern District of Texas. "Without these protections, bankruptcy estate property is at risk of loss in the event of a casualty." About Dean Foods Southern Foods Group, LLC, d/b/a Dean Foods, is a food and beverage company and a processor and direct-to-store distributor of fresh fluid milk and other dairy and dairy case products in the United States. The Company and its 40+ affiliates filed for bankruptcy protection on Nov. 12, 2019 (Bankr. S.D. Texas, Lead Case No. 19-36313). The petitions were signed by Gary Rahlfs, senior vice president and chief financial officer. Dean Foods was estimated to have assets and liabilities of $1 billion to $10 billion as of the bankruptcy filing. Judge David Jones oversees the cases. David Polk & Wardell LLP serves as general bankruptcy counsel to the Debtors, and Norton Rose Fulbright US LLP serves as local counsel. Alvarez Marsal is financial advisor to the Debtors, Evercore Group LLC is investment banker, and Epiq Corporate Restructuring LLC is notice and claims agent. DESTINY SPRINGS: Sept. 2 Disclosure Statement Hearing Set --------------------------------------------------------- Debtor Destiny Springs Healthcare, LLC, filed with the U.S. Bankruptcy Court for the District of Arizona a Disclosure Statement for Plan of Reorganization. On July 21, 2020, Judge Madeleine C. Wanslee ordered that: * Sept. 2, 2020 at 10:00 a.m. is the telephonic hearing to consider the approval of the Disclosure statement. * Aug. 26, 2020 is the deadline for any party desiring to object to the Court’s approval of the Disclosure Statement to file a written objection. * The conclusion of the Disclosure Statement Hearing is the deadline for a secured creditor to make a written election to have its claim treated pursuant to Section 1111(b)(2) of the Bankruptcy Code. A copy of the order dated July 21, 2020, is available at https://tinyurl.com/y2plcjr6 from PacerMonitor at no charge. The Debtor is represented by: Grant L. Cartwright Andrew A. Harnisch May, Potenza, Baran & Gillespie, P.C. 201 N. Central Avenue 22nd Floor Phoenix, Arizona 85004 E-mail: gcartwright@maypotenza.com E-mail: aharnisch@maypotenza.com Fax: (602) 252-1114 About Destiny Springs Healthcare Destiny Springs Healthcare, LLC owns and operates a 90-bed, 67,566-square-foot behavioral healthcare facility located at 17300 N. Dysart Road in Surprise, Ariz. The facility provides both inpatient and outpatient treatment for adolescents, adults and geriatric patients. Destiny Springs Healthcare filed for Chapter 11 bankruptcy protection (Bankr. D. Ariz. Case No. 19-15702) on Dec. 15, 2019. In the petition signed by Dr. Martin Newman, M.D., president, Debtor was estimated to have $1 million to $10 million in both assets and liabilities. Judge Madeleine C. Wanslee oversees the case. Grant L. Cartwright, Esq., at May, Potenza, Baran, & Gillespie, P.C., serves as Debtor's legal counsel. Susan N. Goodman has been appointed as patient care ombudsman. EARTH FARE: Will Reopen Midtown Row Location -------------------------------------------- Alexa Doiron, writing for WY Daily, reports that Earth Fare will reopen its store in Midtown Row, in Williamsburg, Virginia. Fans of Earth Fare will be pleased to know the Williamsburg location will finally be reopening this fall. Earth Fare, located in Midtown Row, closed in February after the company filed for chapter 11 bankruptcy. But since then a community of Earth Fare fans have come out of the woodwork to express their love for the store in hopes that it would return to the area. Multiple locations of the franchise in recent months have been bought by a group of investors, including Dennis Hulsing and former co-owner Randy Talley. The investor group has slowly been reopening various locations and Talley even visited the Williamsburg location in the spring to consider reopening, he said during an interview in March 2020. Broad Street Realty, which owns the space, announced Tuesday that Earth Fare would be reopening in Williamsburg. "Having an organic grocery offering has always been an important part of our vision for Midtown Row and the type of experience we are trying to create here," said Michael Jacoby, CEO of Broad Street Realty, in a news release. There is not an official opening date for the location but current plans are looking toward a fall reopening. Hulsing is committed to preserving the best aspects of Earth Fare's legacy and growing the brand throughout the southeast region, according to a news release. Mike Cianciarulo, former president of Earth Fare, and David Isinghood, a former leader of Whole Foods, have been hired to spearhead the new southeastern venture. Williamsburg is just one of multiple Earth Fare locations set to reopen in the region this year, but it is also a focal piece for Midtown Row, which will feature a new 240-unit apartment complex in the coming years. "We are really looking forward to coming back to Williamsburg," Hulsing said in the news release. "The support from [the] Community and the charge [led] by local team members, advocating for this location, was so impressive." About Earth Fare Inc. Founded in 1975 in Asheville, N.C., Earth Fare, Inc. -- http://www.earthfare.com/-- is a natural and organic food retailer with locations across 10 states. It offers groceries and wellness and beauty products. Earth Fare and its affiliate, EF Investment Holdings, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-10256) on Feb. 4, 2020. At the time of the filing, the Debtors each disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge Karen B. Owens oversees the cases. The Debtors tapped Young Conaway Stargatt & Taylor, LLP as legal counsel; FTI Consulting, Inc. as financial and restructuring advisor; and Epiq Corporate Restructuring, LLC as claims, solicitation and balloting agent. Malfitano Advisors, LLC provides disposition advisory services to the Debtors. The U.S. Trustee for Region 3 appointed five creditors to serve on the official committee of unsecured creditors in the Chapter 11 cases of Earth Fare, Inc. and EF Investment Holdings, Inc. The Committee retained Pachulski Stang Ziehl & Jones LLP, as counsel,and Alvarez & Marsal North America, LLC, as financial advisor. EAST CAROLINA: Has Until Sept. 25 to File Plan & Disclosures ------------------------------------------------------------ Judge Joseph N. Callaway of the U.S. Bankruptcy Court for the Eastern District of North Carolina, Greenville Division, has entered an order within which Debtor East Carolina Commercial Services, LLC must file a plan and disclosure statement on or before Sept. 25, 2020. A status conference will be held on August 20, 2020, at 11:00 a.m. by conference telephone call. A copy of the order dated July 21, 2020, is available at https://tinyurl.com/yx8qw3cv from PacerMonitor at no charge. About East Carolina Commercial Services East Carolina Commercial Services, LLC is a commercial solar installation company specializing in module installation and racking installation based in Wilson, North Carolina. East Carolina Commercial Services sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C. Case No. 20-02361) on June 27, 2020. The petition was signed by Caesar Mendoza, Debtor's managing member. At the time of the filing, Debtor disclosed assets of $1 million to $10 million and liabilities of the same range. Judge Joseph N. Callaway oversees the case. Sasser Law Firm is the Debtor's bankruptcy counsel. ELDER ATTIE: Plan to be Funded by Rental/Property Sale Proceeds --------------------------------------------------------------- Elder Attie Hermon Montgomery Foundation, an Illinois not for profit corporation, filed the Amended Disclosure Statement in conjunction with its Second Amended Plan. The Debtor is the owner of real property commonly known as 913 South 4th Avenue, Maywood, IL 60153 (Rental Property) and 516 South 4th Avenue, Maywood, IL 60153 (Vacant Property, collectively Properties). At the time the Debtor was formed, the mission of the Debtor was, and continues to be, to provide affordable housing for the homeless. The Debtor is the proponent of the Plan. The Plan provides for distributions to the holders of Allowed Claims from funds realized from the sale of the Properties and from cash on hand from the rents received. Class 4 Unsecured Tax Claim of IRS. The Unsecured Tax Claim of IRS shall be paid, with interest at five (5%) per annum, out of the net sales proceeds of the Rental Property, subsequent to payment of the Class 1 and Class 2 Claims and subsequent to the payment of Allowed Administrative Expense Claims. Alternatively, the Class 4, Unsecured Tax Claim will be paid from cash on hand out of the rental receipts collected by the Debtor on the effective date of the Plan. This Class is unimpaired under the Plan. A full-text copy of the Amended Disclosure Statement dated July 21, 2020, is available at https://tinyurl.com/yy7r8fnv from PacerMonitor at no charge. The Debtor is represented by: Joel A. Schechter LAW OFFICES OF JOEL A. SCHECHTER 53 W. Jackson Blvd., Suite 1522 Chicago, Illinois 60604 Tel: (312) 332-0267 E-mail: joel@jasbklaw.com About Elder Attie Elder Attie Hermon Montgomery Foundation is an Illinois not for profit corporation. Elder Attie filed a Chapter 11 petition (Bankr. N.D. Ill. Case No. 19-27509) on Sept. 27, 2019. Joel A. Schechter, Esq. is the Debtor's Counsel. ELK CITY LODGING: $1.7M Cash Sale Elk City Property to Patel Okayed ------------------------------------------------------------------- Judge Sarah A. Hall of the U.S. Bankruptcy Court for the Western District of Oklahoma authorized Elk City Lodging, LLC's short sale of the real property located at 2802 S. Main Street, Elk City, Oklahoma to Sandip Patel for $1.7 million, cash, pursuant to their Contract. The sale is free and clear of all liens, claims and encumbrances. Such liens, claims and encumbrances will attach to the proceeds of sale. The broker's fees will be paid at closing. The reasonable and necessary closing costs will be paid at closing including payment to the U.S. Trustee. The balance of the sales proceeds after the payments described will be paid to Celtic Bank. Notwithstanding anything in the Order to the contrary, the liens securing payment of the 2020 ad valorem taxes will remain attached to the property to secure payment of all ad valorem property taxes assessed on the property for the 2020 tax year and any penalties and interest that may accrue thereon. There will be no 14-day delay in the effectiveness of the Order of Sale. About Elk City Lodging Elk City Lodging, LLC, d/b/a Comfort Inn & Suites, is a privately held company in Elk City, Oklahoma, that operates in the hotel and lodging industry. Elk City Lodging filed a Chapter 11 bankruptcy petition (Bankr. W.D. Okla. Case No. 19-13945) on Sept. 26, 2019 in Oklahoma City, Oklahoma. In the petition signed by CEO Kumar Khemlani, the Debtor was estimated to have both assets and liabilities at $1 million to $10 million. Judge Sarah A. Hall is assigned the case. JOYCE W. LINDAUER ATTORNEY, PLLC, is the Debtor's counsel. ELMORE REALTY: $350K Sale of Holland Property Deemed Moot --------------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts deemed moot Elmore Realty Services, LLC's sale of the real property located at 33 Lee Avenue, Holland, Massachusetts to Lee Ave Peninsula Trust for $350,000, after an amended motion to sell the Property was filed. The Debtor proposed to sell the Property free and clear of all liens, encumbrances, charges and claims of every kind and description. About Elmore Realty Services Elmore Realty Services, LLC sought Chapter 11 protection (Bankr. D. Mass. Case No. 19-30151) on Feb. 27, 2019. In the petition signed by Jennifer Elmore, manager, the Debtor was estimated to have assets and liabilities in the range of $500,001 to $1 million. The Debtor tapped Louis S. Robin, Esq., at Law Offices of Louis S. Robin as counsel. EQT CORP: S&P Affirms 'BB-' ICR, Alters Outlook to Stable --------------------------------------------------------- S&P Global Ratings revised its outlook on U.S.-based exploration and production company EQT Corp. to stable from negative and affirmed its 'BB-' issuer credit and unsecured issue-level ratings. EQT has reduced and refinanced debt and increasing cash flow generation over the past few months. The company has applied proceeds from noncore asset sales and tax refunds, as well as operating free cash flow, to the repayment of near-term debt, reducing net debt by $670 million overall since year-end 2019 as of July 31, 2020. At the same time, EQT lowered its general and administrative expenses and well costs substantially in the first half of 2020, thereby supporting future cash flow generation. EQT's debt maturity profile has significantly improved since the beginning of the year. In January, EQT issued $1 billion of senior notes due 2025 and $750 million of senior notes due 2030, and in April, it issued $500 million of senior convertible notes due 2026 (unrated). As a result of these transactions and the proceeds from asset sales and tax refunds, the company has fully repaid or refinanced more than $2.5 billion of debt due 2020 and 2021 since year-end 2019. The next debt maturities include $11 million due in October 2020, $168 million due in the second half of 2021 and $750 million due in October 2022. Under S&P's base-case scenario, it forecasts credit metrics will be adequate for the rating over the next couple of years. S&P now projects FFO to debt of 25%-30% and debt to EBITDA of about 3x in 2020 and 2021. It forecasts EQT will generate free cash flow of $300 million-$500 million annually over the next couple years, including its assumption of $200 million of further asset sales in the second half of 2020. S&P believes this level of cash flow generation should allow EQT to address most of its debt maturities through 2022. In addition, the rating agency believes EQT could access capital markets if needed because market conditions have improved since April. Risks to S&P's forecasts include volatile commodity prices (only about 40% of the company's natural gas production is hedged in 2021), higher-than-expected capital spending, or a more shareholder-oriented financial policy. The stable outlook reflects S&P's expectation that EQT's credit measures will be in line for the rating over the next two years, with FFO to debt of 25%-30% and debt to EBITDA of about 3x. "We could lower our rating on EQT if the company's financial performance weakens such that expected FFO to debt declines to below 20% and remains there for a sustained period. Such an event could occur if natural gas prices or regional price differentials deteriorate without a compensating reduction in capital spending," S&P said. "An upgrade over the next year is unlikely under our commodity prices assumptions. We could consider a positive rating action if EQT's leverage measures improve such that FFO to total debt exceeds 30% on sustained basis and the company generates free cash flow on a consistent basis," the rating agency said. FAITH CATHEDRAL: Seeks Approval to Hire POHL as Bankruptcy Counsel ------------------------------------------------------------------ Faith Cathedral Look Up and Live Ministries, Inc. seeks approval from the U.S. Bankruptcy Court for the District of South Carolina to employ POHL, PA as bankruptcy counsel. The firm's services will include: (a) preparation or amendment of schedules and representation in contested matters and adversary proceedings; (b) preparation of a plan of reorganization and disclosure statement; and (c) other matters which may arise during the administration of Debtor's Chapter 11 case. The firm's standard hourly rates are as follows: Robert Pohl $345 Legal Assistants $75 The firm has agreed to receive a pre-bankruptcy retainer in the amount of $10,000 from Debtor. Robert Pohl, Esq., at POHL, disclosed in court filings that the firm is a "disinterested person" within the meaning of Sections 101(14) and 327 of the Bankruptcy Code. The firm can be reached through: Robert Pohl, Esq. POHL, PA 32 South Main Street, Suite 215 Greenville, SC 29601 Telephone: (864) 223-6294 Email: Robert@Pohlpa.com About Faith Cathedral Look Up and Live Ministries Faith Cathedral Look Up and Live Ministries, Inc., a tax-exempt religious organization based in Piedmont, S.C., filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.S.C. Case No. 20-03333) on Aug. 24, 2020. Jenette Cureton, assistant administrator, signed the petition. At the time of the filing, Debtor disclosed $1 million to $10 million in both assets and liabilities. Judge Helen E. Burris oversees the case. Robert Pohl, Esq., at POHL, P.A., serves as Debtor's legal counsel. FIRST ENERGY CORP: Analysts Forecast Its Economic Fallout --------------------------------------------------------- Mark Williams, writing for The Columbus Dispatch, reports that industry analysts has forecasted the economic fallout of Akron companies implicated in the public corruption scandal. With FirstEnergy Corp. and its former subsidiaries implicated in a public corruption scandal, market analysts are sharing varying degrees of concern for the economic toll two of Akron’s biggest employers could pay. Racketeering charges filed Tuesday against a lawmaker and four associates, who allegedly took donations in exchange for a $1 billion energy bailout bill, all but named FirstEnergy and its former power-generation subsidiary FirstEnergy Solutions as the source of the cash. FirstEnergy Solutions is now Energy Harbor after emerging in February from Chapter 11 bankruptcy. Now two companies with headquarters in Akron and thousands of employees in multiple states, FirstEnergy Corp. and Energy Harbor say they’re reviewing the criminal complaint and cooperating with federal investigators. Neither will talk about the potential impact on business or investor confidence. Stock prices for both companies are off by a third since the scandal broke. Subpoenas announced Tuesday evening for FirstEnergy followed the morning arrests of Ohio Speaker of the House Larry Householder, former GOP Chairman Matt Borges and three top statehouse lobbyists. The men and Generation Now, a dark money group that investigators believe Householder used to conceal FirstEnergy donations, are being charged with racketeering. “FirstEnergy is an integral part of our local economy, employing thousands of hard-working residents,” said Akron Mayor Dan Horrigan, who was “shocked” Tuesday by allegations that lawmakers illegally enriched themselves through a “criminal conspiracy.” “FirstEnergy has indicated that they are fully cooperating with this ongoing investigation,” the mayor continued. “The men and women who rely on FirstEnergy for employment are our neighbors — working to provide for their families, even through these tumultuous times.” Political backlash could be especially costly for Energy Harbor, which is depending on the controversial state bailout signed into law last year. Two Republicans and several Democrats said Wednesday morning that they intend to claw back the subsidy. “When I spoke in support of H.B. 6, it was with the hope of keeping many good paying jobs in our community,” said Summit County Executive Ilene Shapiro. “Maintaining jobs is important, but not at the cost of the alleged activities that appear to have put H.B. 6 into action. The news out of Columbus yesterday was both shocking and disappointing.” The repeal of House Bill 6, which Gov. Mike DeWine said Wednesday he would not support, could rewind the clock for Energy Harbor to March 29, 2018, when — then operating as FirstEnergy Solutions — the Davis-Besse nuclear power plant was scheduled for decommission in May 2020 followed by the Perry Nuclear Power Plant in 2021. Struggling to compete with cheap natural gas, the plants each employ about 700 people. FirstEnergy Solutions filed Chapter 11 bankruptcy two days later on March 31, 2018. That July, FirstEnergy Solutions arranged but did not follow through with the sale of its retail and wholesale electricity business to Constellation, a subsidiary of Chicago-based energy giant Exelon. By 2019, the financial outlook improved. A bankruptcy settlement was reached in October. FirstEnergy shareholder dividends increased 5.6% in 2019, the first increase since falling 35% in 2014, according to Charles Fishman, an equity analyst at market research firm Morningstar. With monthly revenue of about $150 million, Energy Harbor values itself post-bankruptcy at $1.2 billion, according to a March financial report. The company serves 900,000 customers with nuclear and coal-fired power plants in Ohio, Pennsylvania and West Virginia, and employs 2,600 workers — including 1,000 under collective bargaining agreements. Analysts say solar, wind and other renewable sources could feasibly replace the electrical output of Energy Harbor’s two nuclear power plants, which currently provide the bulk of Ohio’s zero emission energy. Among the nation’s largest investor-owned utility companies, FirstEnergy Corp. provides electricity to 6 million customers through 10 subsidiaries, including Ohio Edison, Cleveland Electric Illuminating and Toledo Edison in Ohio. About 36 hours since news broke of the public scandal Tuesday morning, Energy Harbor stock fell 33.5%, from $35.35 to $27.09 at market’s close Wednesday. FirstEnergy Corp. stock fell 35% over the two trading sessions, from $41.64 at the opening bell Tuesday to $27.09 by Wednesday’s end. FirstEnergy is scheduled to release its financial results for its April-June quarter Thursday afternoon. A conference call with analysts to discuss the financial results will be held Friday morning. Analysts say the arrests have created uncertainty about FirstEnergy and where the investigation about House Bill 6 is going. “We are concerned about the potential implications for [FirstEnergy], which we find impossible to predict with any degree of certainty at this juncture,” KeyBanc analyst Sophie Karp said in a research note released Tuesday. More charges could be coming. Karp said phone calls and contributions detailed in the criminal complaint suggest “some degree of collusion between Company A [FirstEnergy] and ‘the Enterprise’ of the [House Speaker Larry Householder] and his associates.” “We expect share volatility near term for FirstEnergy Corp., but believe additional details will be needed on the specifics of the case to determine where the risks lie,” analyst Paige Meyer said. Fishman with Morningstar said the investigation is problematic for FirstEnergy. But he said investors are overreacting. “I’ve been doing this for a long time. What am I missing?” he said. FirstEnergy’s Ohio operations are 20% of all operating earnings, which cover operations all the way to Maryland. And FirstEnergy’s Ohio utility rates are locked in until at least 2024, which provides some predictability. “We also find it hard to believe that FirstEnergy’s management was directly involved in any bribery scheme with respect to HB 6,” he said in a research note Tuesday. “Although FirstEnergy CEO Chuck Jones had been very vocal in his support for the legislation, his support was based on his belief that the nuclear plants were important to Ohio, the communities in which they were located, and the plant employees. When passed, HB 6 had minimal benefit for FirstEnergy or Jones.” Still, the revelation could harm FirstEnergy’s relationship with regulators and legislators in Ohio. Jones, the CEO and president, already has been talking about retiring. “It will be messy. It does not look good for them,” said Fishman, who kept his $44 price target on FirstEnergy shares. About FirstEnergy Corp. ased in Akron, Ohio, FirstEnergy Corp. and its subsidiaries are principally involved in the generation, transmission, and distribution of electricity. FirstEnergy's ten utility operating companies comprise one of the nation's largest investor-owned electric systems, based on serving six million customers in the Midwest and Mid-Atlantic regions. FirstEnergy Corp. holds the outstanding common stock of its principal subsidiaries: Ohio Edison Company (OE), The Cleveland Electric Illuminating Company (CEI), The Toledo Edison Company (TE), Pennsylvania Power Company (Penn) (a wholly owned subsidiary of OE), Jersey Central Power & Light Company (JCP&L), Metropolitan Edison Company (ME), Pennsylvania Electric Company (PN), FirstEnergy Service Company (FESC), FirstEnergy Solutions Corp. (FES) and its principal subsidiaries (FirstEnergy Generation, LLC (FG) and FirstEnergy Nuclear Generation, LLC, (NG)), Allegheny Energy Supply Company, LLC (AE Supply), Monongahela Power Company (MP), The Potomac Edison Company (PE), West Penn Power Company (WP), FirstEnergy Transmission, LLC (FET) and its principal subsidiaries (American Transmission Systems, Incorporated (ATSI) and Trans-Allegheny Interstate Line Company (TRAIL), and Allegheny Energy Service Corporation (AESC). In addition, FE holds all of the outstanding common stock of other direct subsidiaries including: FirstEnergy Properties, Inc., FirstEnergy Ventures Corp. (FEV), FirstEnergy Nuclear Operating Company (FENOC), FELHC, Inc., GPU Nuclear, Inc., and Allegheny Ventures, Inc. On March 31, 2018, FES, including its consolidated subsidiaries, FG, NG, FE Aircraft Leasing Corp., Norton Energy Storage L.L.C. and FirstEnergy Generation Mansfield Unit 1 Corp, and FENOC filed voluntary petitions for bankruptcy protection under Chapter 11 of the United States Bankruptcy Code in the Bankruptcy Court. FLORIDA FIRST: Nov. 17 Auction of Substantially All Assets Set -------------------------------------------------------------- Judge Jerry A. Funk of the U.S. Bankruptcy Court for the Southern District of Florida authorized Florida First City Banks, Inc.'s bidding procedures in connection with the sale of substantially all its assets to Hawthorne Ocala Operations, LLC for $2 million, subject to adjustments set forth in their Operations Transfer Agreement, subject to overbid. The salient terms of the Bidding Procedures are: a. Bid Deadline: Nov. 12, 2020 at 5:00 p.m. (EST) b. Initial Bid: Any initial Bid for substantially all of the HOO Purchased Assets must provide for a purchase price of at least 100,000 above the purchase price offered by HOO. HOO will be entitled to submit further bids at the Auction. All subsequent higher Bids for substantially all of the HOO Purchased Assets the initial Bid (including any subsequent Bid which may be made by HOO) must be in an amount which nets at least $20,000 in increased consideration and be payable in cash. For purposes of calculating such net increased consideration, the Break-Up Fee ($60,000) will be taken into account. c. Deposit: 50,000 made payable to ohnson Pope Bokor Ruppel & Burns, LLP, the counsel to the Debtor d. Auction: An auction to consider any competing Bids in respect of the Offered Assets will be held at the office of Johnson Pope two days prior to the date of the Sale Hearing (Nov. 17, 2020) e. Bid Increments: $20,000 f. Sale Hearing: Nov. 19, 2020 at 1:30 p.m. g. Sale Objection Deadline: Nov. 12, 2020 By no later than three days after the entry of the Bid Procedures Order, the Debtor will file with the Court, and serve notice thereof on interested parties as required by the Bid Procedures Order, the Sale Motion consistent with the terms, conditions and dates set forth in the Bid Procedures Order. As soon as practicable, but in any event no later than five business days following entry of the Order, the Debtor will serve the Assumption and Assignment Notice upon each counterparty (including the Owner) to an executory contract with the Debtor. The Cure Amount Objection Deadline is Nov. 16, 2020. Following the entry of the Order, the Debtor will serve a copy of the Order to (a) parties listed on the Local Rule 1007-2 Parties in Interest List; (b) all parties which, to the knowledge of the Debtors, have or have asserted liens on the Offered Assets; (c) the Owner; (d) all counterparties to the Contracts; and (e) any party that has expressed an interest to the Debtor in acquiring any of the Offered Assets. Attorney Alberto F. Gomez, Jr., Esq. is directed to serve a copy of the Order on interested parties who do not receive service by CM/ECF and file a proof of service within three days of its entry. Florida First City Banks Florida First City Banks, Inc., is a privately held company that operates in the banking industry. Florida First City Banks sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 20-30037) on Jan. 15, 2020. In the petition signed by Robert E. Bennett, Jr., president, the Debtor disclosed total assets of $5,448,525 and total liabilities. $12,680,735 in total debt. The Debtor tapped Steven J. Ford, Esq., at Wilson, Harrell, Farrington, Ford, Et Al., as counsel. FM COAL: Case Summary & 40 Largest Unsecured Creditors ------------------------------------------------------ Lead Debtor: FM Coal, LLC 4650 Flat Top Road Graysville, AL 35073 Business Description: The Debtors are engaged in the business of extracting, processing and marketing metallurgical coal and thermal coal from surface mines. The Debtors' customers include steel and coke producers, industrial customers and electric utilities. Chapter 11 Petition Date: September 1, 2020 Court: United States Bankruptcy Court Northern District of Alabama Six affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- FM Coal, LLC (Lead Debtor) 20-02783 Cane Creek, LLC 20-02785 M. S. & R. Equipment Co., Inc. 20-02788 Cedar Lake Mining, Inc. 20-02790 Xinergy of Alabama, Inc. 20-02791 Best Coal, Inc. 20-70987 Judge: Hon. Tamara O. Mitchell Debtors' Counsel: Jesse S. Vogtle, Jr., Esq. Eric T. Ray, Esq. Paul Greenwood, Esq. WALLER LANSDEN DORTCH & DAVIS, LLP 1901 Sixth Avenue North, Suite 1400 Birmingham, Alabama 35203 Tel: (205) 241-6380 Fax: (205) 214-8787 Email: Jesse.Vogtle@wallerlaw.com Eric.Ray@wallerlaw.com Paul.Greenwood@wallerlaw.com - and - John Tishler, Esq. Tyler N. Layne, Esq. 511 Union Street, Suite 2700 Nashville, TN 37219 Tel: (615) 244-6380 Fax: (615) 244-6804 Email: John.Tishler@wallerlaw.com Tyler.Layne@wallerlaw.com Debtors' Financial Advisor: AURORA MANAGEMENT PARTNERS Debtors' Notice, Claims, Solicitation, & Balloting Agent: DONLIN RECANO & COMPANY, INC. https://www.donlinrecano.com/Clients/fm/Dockets Estimated Assets: $10 million to $50 million Estimated Liabilities: $50 million to $100 million The petition was signed by Michael Costello, sole member. A copy of FM Coal's petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/QLOOWKI/FM_Coal_LLC__alnbke-20-02783__0001.0.pdf?mcid=tGE4TAMA Consolidated List of Debtors' 40 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. KeyBank National Association Paycheck $3,589,108 4900 Tiedeman Rd Protection OH-01-49-0362 Program Loan Brooklyn OH 44144 2. Sunoco, LLC Trade $2,782,354 P.O. Box 206458 Dallas TX 75320-6458 Lisa Serna Email: lisa.serna@sunoco.com 3. Eagle Specialty Materials Trade $2,421,297 10023 Hwy. 14-16 Gilette WY 82718 4. Dyno Nobel, Inc. Trade $1,656,388 Department 2643 P.O. Box 122623 Dallas TX 75312-2643 Tel: (304) 239-2452 5. Nelson Brothers Trade $1,383,749 820 Shades Creek Parkway Suite 2000 Birmingham AL 35209 Tel: (205) 802-5305 Email: lwhisenant@lenbro.com 6. Thompson Tractor Co Trade $1,179,115 P.O. Box 10367 2401 Pinson Highway Birmingham AL 35202 Eric Spears Tel: (205) 841-8601 Email: ericspears@thompsontractor.com 7. Dutch Lubricants, Inc. Trade $821,818 P.O. Box 958669 St. Louis MO 63195-8669 Lance Tucker Email: lance.tucker@reladyne.com 8. Intertractor American Corp Trade $502,354 960 Proctor Drive Elkhorn WI 53121 Tel: (262) 723-6000 Email: gmason@intertractoramerica.com 9. Brake Supply Company Inc Trade $388,315 4280 Paysphere Circle Chicago IL 60674 Email: tberkley@brake.com 10. Drummond Company, Inc. Trade $207,005 Attention: Land Department P.O. Box 1549 Jasper AL 35502-1549 Email: mosburn@drummondco.com 11. Hose Power USA Trade $105,371 P.O. Box 861777 Orlando FL 32886-1777 Tel: (904) 264-1267 Email: enewsome@hosepower.com 12. Tractor & Equipment Company Trade $104,495 P.O. Box 12386 5336 Messer Airport Highway Birmingham AL 35202-2326 Email: rpowers@tec1943.com 13. Dixie Trucking Trade $96,874 P.O. Box 1839 198 Pawnee Road Pinson AL 36126 Email: martha@metrotireinc.com 14. Mega Highwall Mining Trade $91,562 P.O. Box 5005 PMB#116 Rancho Santa Fe CA 92067 Email: decanterbury.kyz@gmail.com 15. W.H. Thomas Oil Co Inc. Trade $84,796 P.O. Box 890 702 Greasy Ridge Road Clanton AL 35046 Tel: (205) 755-2610 Email: dan@whthomasoil.com 16. GCR Tires and Service Trade $73,732 P.O. Box 910530 Denver CO 80291-0530 Email: westbrookjames@bfusa.com 17. TerraPro Trade $61,657 P.O. Box 213 Jasper Al 35502 Tel: (205) 483-8070 Email: michelle@terrapro@gmail.com 18. Warrior Tractor & Equipment Trade $61,596 P.O. Box 412 Northport AL 35476 Email: wte006@warriortractor.com 19. Perry Supply, Inc. Trade $54,092 P.O. Box 1237 Birmingham AL 35203 Lisa Sexton Email: lsexton@perrysupply.com 20. Hydra Service Inc. Trade $45,209 P.O. Box 365 Warrior AL 35180 Email: acctsrec@hydraservice.net 21. Southern Tire Mart Trade $42,734 Dept. 143 P.O. Box 1000 Memphis TN 38148-0143 Danny Helms Tel: (205) 384-3440 Email: danny.helms@stmtires.com 22. McGehee Engineering Corp. Trade $42,426 P.O. Box 3431 Jasper AL 35502-3431 Email: melissa@mcgehee.com 23. Raccoon Mountain MLT Trade $38,458 7802 Highway 78 Cordova AL 35550 24. Mineral Labs, Inc. Trade $38,127 P.O. Box 549 Salyersville KY 41465 Kelly Broome Tel: (606) 349-6145 Email: kellybroome@minerallabs.com 25. Sandvik Mining & Construction Trade $37,474 USA LLC Dep CH - 10576 Palatine IL 60055-0576 Diane Holbrook Email: diane.holbrook@sandvik.com 26. S&S Heavy Equipment AC Trade $34,681 Service 13534 Deerlick Road Tuscaloosa AL 35406 Tel: (205) 765-4558 Email: wsand33@gmail.com 27. Fredrickson & Arlyn L. Lynn Trade $33,882 Trust 1165 Lake Forest Circle Birmingham AL 35244 Mark Muir Email: mmuir@muirreportinggroup.com 28. Stewart Lubricants & Services Trade $32,817 144 Citation Court Birmingham AL 35209 Email: jeanette@stewartlubricants.com 29. Nalco Company Trade $26,845 P.O. Box 70716 Chicago IL 60673-0716 Email: renee.hurd@ecolab.com 30. Wilson Machine & Welding Inc. Trade $23,226 14787 Highway 78 Cordova AL 35550 Email: r.baker@tuckeralbin.com 31. United States Treasury Trade $20,000 Mine Safety and Health Administration P.O. Box 790390 St. Louis MO 63179-0390 32. Jasper Industrial Maintenance Trade $19,292 Supply 1404 10th Avenue West Jasper AL 35501 Email: judy@jasperind.com 33. Madison Materials Trade $17,818 P.O. Box 306 Guntersville AL 35976 Tel: (205) 429-3807 34. RDBT Enterprises, Inc. Trade $17,425 18439 Highway 69, South Jasper AL 35501 Tel: (205) 384-0250 35. Cowin Equipment Co., Inc. Trade $17,099 P.O. Box 10624 Birmingham AL 35202 Tel: (205) 841-6666 Email: dpatterson@cowin.com 36. Nabors Radiator & Elec. Serv. Trade $17,045 Co. 617 25th Street South Birmingham AL 35223 Tel: (205) 252-6133 Email: lisa@naborsdiesel.com 37. G & R Mineral Services, Inc. Trade $16,300 P.O. Box 100939 2355 Alton Road Birmingham AL 35210 Tel: (205) 956-7305 38. Office of Surface Mining Trade $15,903 Reclamation and Enforcement P.O. Box 360095M Pittsburg PA 15251-6095 Email: getinfo@osmre.gov 39. Komatsu Trade Undetermined 8770 W. Brun mawr Ave. Suite 100 Chicago, IL 60631 Dylan Tysiak Tel: (847) 437-0057 Email: dytysiak@komatsuna.com 40. Alabama Department of Coal Severance Undetermined Revenue Taxes Business & License Tax Div. Severance Taxes P.O. Box 327560 Montgomery AL 36132-7560 Tel: (334) 242-9612 Fax: (334) 353-1809 FROGNAL HOLDINGS: U.S. Trustee Unable to Appoint Committee ---------------------------------------------------------- The Office of the U.S. Trustee disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Frognal Holdings, LLC. About Frognal Holdings Frognal Holdings, LLC is a single asset real estate (as defined in 11 U.S.C. Section 101(51B)) whose principal property is located at 13500 60th Ave., West Edmonds, Wash. The property is a 112-lot residential subdivision having an appraised value of $30.8 million. Frognal Holdings filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Wa. Case No. Frognal Holdings, LLC) on July 23, 2020. At the time of filing, Debtor disclosed $30,921,624 in assets and $11,302,231 in liabilities. Christine M. Tobin-Presser, Esq., at Bush Kornfeld LLP, is Debtor's legal counsel. FRUITION RESTAURANTS: Seeks to Hire Henry & Regel as Legal Counsel ------------------------------------------------------------------ Fruition Restaurants, LP seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to employ Henry & Regel, LLC as its legal counsel. The firm will render these legal services: (a) advise Debtor with respect to its powers and duties in the continued operation of its business and the management of its property; (b) take all necessary actions to protect and preserve Debtor's estate; (c) prepare legal papers; (d) assist Debtor in preparing a disclosure statement and related documents; and (e) perform other legal services for Debtor in connection with its Chapter 11 case. The firm's hourly rates are as follows: John P. Henry $450 Partner and Associate Attorneys $350 Paralegals and Legal Assistants $30 - $50 In addition, Debtor will reimburse the firm for all out-of-pocket expenses incurred. On May 13, 2020, the firm received a retainer of $20,000 from Debtor, plus the filing fee of $1,717. John Henry, Esq., the firm's attorney who will be handling the case, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: John P. Henry, Esq. Henry & Regel, LLC 2100 Ross Avenue, Suite 800 Dallas, TX 75201 Telephone: (972) 338-3630 Facsimile: (888) 909-9312 Email: John@henryregel.com About Fruition Restaurants Fruition Restaurants, LP filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 20-31993) on July 24, 2020, listing under $1 million in both assets and liabilities. Judge Stacey G. Jernigan oversees the case. John P. Henry, Esq., at Henry & Regel, LLC, serves as Debtor's legal counsel. GATEWAY FIVE: Case Summary & 16 Unsecured Creditors --------------------------------------------------- Debtor: Gateway Five, LLC 24440 Mulholland Highway Calabasas, CA 91302 Chapter 11 Petition Date: August 31, 2020 Court: United States Bankruptcy Court Central District of California Case No.: 20-11582 Judge: Hon. Martin R. Barash Debtor's Counsel: Daniel M. Shapiro, Esq. DANIEL M. SHAPIRO, ATTORNEY AT LAW 1366 E. Palm St. Altadena, CA 91001 Tel: 626-398-5137 E-mail: dan@dmslawyer.com - and - Sevan Gorginian, Esq. LAW OFFICE OF SEVAN GORGINIAN 450 N. Brand Blvd. Suite 600 Glendale, CA 91203 Tel: 818-928-4445 Fax: 818-928-4450 Email: sevan@gorginianlaw.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by James Acevedo, president and officer. A copy of the petition containing, among other items, a list of the Debtor's 16 unsecured creditors is available at for free at PacerMonitor.com at: https://www.pacermonitor.com/view/TPJMOMQ/Gateway_Five_LLC__cacbke-20-11582__0001.0.pdf?mcid=tGE4TAMA GLOBAL ASSET: Sept. 18 Auction of Substantially All Assets Set -------------------------------------------------------------- Judge Karen S. Jennemann of the U.S. Bankruptcy Court for the Middle District of Florida authorized the bidding procedures proposed by Global Asset Rental, LLC, formerly known as Global Keg Rental, LLC, in connection with the auction sale of substantially or all assets. A hearing on the Motion was held on Aug. 21, 2020 at 2:00 p.m. The salient terms of the Bidding Procedures are: a. Bid Deadline: Sept. 16, 2020 at 5:00 p.m. (ET) b. Initial Bid: Each Bid must include written evidence which in the sole and absolute discretion of the Debtor establishes that the Bidder has the financial ability to consummate the purchase of the Assets should such Bidder submit the highest and best bid. c. Deposit: 10% of the purchase price for the Assets proposed by a Bidder into the trust account of Genovese Joblove & Battista, P.A. d. Auction: If more than one Qualified Bid is timely received by the Debtor in accordance with the Bid Procedures, then the Debtor will conduct the Auction on Sept. 18, 2020 at 10:00 a.m. (ET) virtually through an online platform (such as Zoom), or through such other means or such other place and time as the Debtor will notify all Qualified Bidders, the Consultation Parties and other invitees. e. Bid Increments: $100,000 f. Sale Hearing: Sept. 21, 2020 at 2:00 p.m. (ET) g. Sale Objection Deadline: 4:00 p.m. (ET) two business days before the Sale Hearing h. Closing: The closing of the transaction will take place promptly after entry of the Sale Order, but in no event later than five business days thereafter provided that the Sale Order waives the 14-day stay pursuant to Fed. R. Bankr. P. 6004(h), provided further that in the event the 14-day stay is not waived, then the Closing Date will be on the first business day after the expiration of such 14-day stay. The Sale Notice is approved. Three business days after entry of the Bid Procedures Order, the Debtor will cause the Sale Notice upon all the Sale Notice Parties. The Cure Notice is approved. Five business days after the entry of the Bid Procedures Order, the Debtor will cause the Cure Notice to be served on any and all counterparties to executory contracts and unexpired leases that may be Potential Assumed and Assigned Contracts. The Cure Objection Deadline is 4:00 p.m. (ET), within 14 calendar days of the date on which the Cure Notice is served (not counting the day served). The Debtor reserves the right to enter into an agreement for an initial stalking horse bid for the Assets in advance of the Bid Deadline, which stalking horse bid will be subject to higher and better bids at the Auction. In the event the Debtor enters into such Stalking Horse Agreement, then the Debtor may file a motion with the Court to approve such Stalking Horse Agreement and any natters related thereto, and the Court will conduct a hearing thereon on an expedited basis. The stay provided for in Bankruptcy Rule 6004(h) is waived and the Bid Procedures Order will be effective immediately upon its entry. All time periods set forth in the Bid Procedures Order will be calculated in accordance with Bankruptcy Rule 9006(a). Attorney Battista is directed to serve a copy of the Order on interested parties who do not receive service by CM/ECF and file a proof of service within three days of its entry. A copy of the Bidding Procedures is available at https://tinyurl.com/y64x22jf from PacerMonitor.com free of charge. About Global Asset Rental, LLC f/k/a Global Keg Rental, LLC Global Asset Rental, LLC -- http://www.globalkeg.com/-- is an asset rental and logistics solutions company engaged in the business of renting plastic pallets and kegs. Global Asset Rental, LLC f/k/a Global Keg Rental, LLC, based in Orlando, FL, filed a Chapter 11 petition (Bankr. M.D. Fla. Case No. 6:20-bk-04126) on July 23, 2020. In its petition, the Debtor was estimated to have $10 million to $50 million in assets and $50 million to $100 million in liabilities. Genovese Joblove & Battista, P.A., serves as bankruptcy counsel to the Debtor. KapilaMukamal, LLP's Soneet R. Kapila is the CRO. GLOBAL EAGLE: Has $675M Deal With 1st Lien Lenders -------------------------------------------------- Global Eagle Entertainment Inc. (Nasdaq: ENT), a leading provider of media, content, connectivity and data analytics to mobility end-markets across air, sea and land, today announced that it has agreed upon a definitive "stalking horse" asset purchase agreement under which substantially all of the Company's assets will be acquired for total consideration of $675 million by an entity established at the direction of holders of approximately 90% of the Company's senior secured first-lien term loans, led by lenders managed by Apollo Global Management, Inc., Eaton Vance Management, Arbour Lane Capital Management, L.P., Sound Point Capital Management, Mudrick Capital Management, or one or more of their respective affiliates, and certain funds and accounts under management by BlackRock Financial Management, Inc. (the "Investor Group"). The proposed transaction will have no material impact on Global Eagle's global operations as the Company continues to provide services to all of its customers in the ordinary course, before and after the transaction. As a result of the proposed transaction, the Company will reduce its total debt by approximately $475 million and obtain significant additional liquidity, positioning it to continue driving long-term innovation and growth and serving its customers around the world. "Today's announcement represents a significant step forward that positions Global Eagle for long-term success as we continue connecting millions to high speed Wi-Fi and engaging content, anywhere, anytime," said Joshua Marks, Chief Executive Officer of Global Eagle. "While we made important progress last year managing our cash flow and reducing operating expenses, we have been particularly impacted by COVID-19-related travel restrictions and demand declines in both airline and cruise end-markets. We expect to emerge from this process with a stronger balance sheet, significantly reduced debt and substantial liquidity, well-positioned to continue supporting our global customers into the future. Our investors have been strong strategic partners with Global Eagle, we appreciate their continued support, and we believe this is the best path forward for our company and our customers, partners and employees." Mr. Marks continued, "We remain steadfast in our belief that our airline, cruise line and other customers will recover from COVID-19 and generate significant long-term demand for our services. We are excited about the opportunities ahead to build on our strong foundation as the world's leading entertainment and connectivity provider for mobility. We remain focused on supporting our customers as they plan for the COVID-19 recovery and beyond, and are working closely with our vendors and other partners. We thank our employees for their continued hard work and dedication to our customers and our company." Jeffrey Rosen, Managing Director with the Credit business segment of Apollo, said, "Global Eagle is a market leader in delivering in-flight and at-sea passenger experiences with entertainment, content and connectivity. While the Company reports that it has been impacted in recent months by COVID-19, we believe it benefits from a blue-chip customer base, industry-leading partnerships and an innovative platform built through years of strategic investments in technology. We believe Global Eagle’s services will continue to be core to the passenger experience over the long term, and see significant opportunities ahead for the Company to continue driving growth and innovation. We also have tremendous confidence in Josh and the management team's ability to lead Global Eagle through the current environment and into the future, and look forward to working closely with them as we move forward." To facilitate the sale process, Global Eagle and certain of its U.S. subsidiaries have filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. Global Eagle continues to operate, and expects to continue operating and serving customers in the ordinary course during and following the court-supervised process. The Company remains focused on supporting its customers with best-in-class media, content and connectivity solutions for aviation, maritime, enterprise and government mobility end-markets. In connection with this in-court process, Global Eagle will be obtaining $80 million in debtor-in-possession financing from the Investor Group. The Company expects this new financing, together with cash generated from ongoing operations, to provide ample liquidity to support its operations during the sale process. In addition to this $80 million DIP financing, the acquisition is expected to be financed by an additional investment in the business in the form of a $125 million exit facility, which would include assumption or refinancing of the DIP financing. The proposed transaction will be implemented pursuant to the terms of a Restructuring Support Agreement reached by the Company and the Investor Group. The proposed transaction is being undertaken pursuant to a court-supervised sale process under Section 363 of the U.S. Bankruptcy Code, with the Investor Group serving as the “stalking-horse” bidder. The proposed transaction is subject to higher or better offers and other customary conditions. Global Eagle has filed a number of customary motions seeking court approval to continue supporting its operations during the court-supervised process, including the continued payment of employee wages and benefits without interruption. The Company intends to pay vendors and partners to its affected U.S. subsidiaries in full under normal terms for goods and services provided on or after the filing date, and expects to receive approval for all of these requests. Vendors to Global Eagle’s non-U.S. subsidiaries will continue to be paid in the ordinary course, regardless of when goods or services were delivered. About Global Eagle Entertainment Headquartered in Los Angeles, California, Global Eagle -- http://www.GlobalEagle.com/-- is a provider of media, content, connectivity and data analytics to markets across air, sea and land. Global Eagle offers a fully integrated suite of media content and connectivity solutions to airlines, cruise lines, commercial ships, high-end yachts, ferries and land locations worldwide. Global Eagle Entertainment Inc., based in Los Angeles, CA, and its debtor-affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11835) on July 22, 2020. The Hon. John T. Dorsey presides over the case. In the petition signed by CFO Christian M. Mezger, Global Eagle disclosed $630.5 million in assets and $1.086 billion in liabilities. Global Eagle tapped LATHAM & WATKINS LLP (CA), and YOUNG CONAWAY STARGATT & TAYLOR, LLP, as counsel; GREENHILL & CO., LLC, as investment banker; and ALVAREZ & MARSAL NORTH AMERICA, LLC, as financial advisor. PRIME CLERK LLC, is the claims and noticing agent. PRICEWATERHOUSECOOPERS LLP is the tax advisor. GLOBAL EAGLE: Oct. 9 Auction of Substantially All Assets -------------------------------------------------------- Judge John T. Dorsey of the U.S. Bankruptcy Court for the District of Delaware to authorized the bidding procedures of Global Eagle Entertainment Inc. and its debtor-affiliates in connection with one or more sales or dispositions of all or substantially all their assets to Gee Acquisition, LLC, subject to overbid. The aggregate consideration for the Purchased Assets consists of (a) a credit bid (i) up to 100% of the obligations owed by Sellers under the Pre-Petition Credit Agreement as of the Closing and (ii) only to the extent necessary to acquire any DIP Collateral, up to $5 million of the DIP Obligations; and (b) an amount in cash equal to the sum of (i) the amount set forth in the Wind-Down Budget and (ii) an amount equal to the DIP Obligations outstanding as of the Closing less the amount of the DIP Obligations, if any, used in the foregoing clause (a)(i); and (c) the assumption of the Assumed Liabilities. The salient terms of the Bidding Procedures are: a. Bid Deadline: Oct. 5, 2020 at 4:00 p.m. (ET) b. Initial Bid: Must exceed, with respect to Bids that contemplate purchasing all or substantially all Assets: (a) the aggregate sum of the aggregate consideration contemplated by the Stalking Horse Bid, (b) the minimum Bid increment of $1 million (or such other amount as the Debtors may determine in consultation with the Consultation Parties, which amount may be less than $1 million, including with respect to a Bid for less than all Assets) and (c) the amount of the Expense Reimbursement. The minimum Bid increment must be in the form of cash or cash equivalents and/or the assumption of liabilities and result in the Discharge of the DIP and First Lien Obligations. c. Deposit: 10% of the aggregate purchase price of the Bid d. Auction: The Auction, if any, will be held on Oct. 9, 2020, at 10:00 a.m. (ET). It will be held in accordance with the Bidding Procedures at the offices of counsel, Latham & Watkins LLP, loacted at 885 Third Avenue, New York, New York 10022. In the event that the Auction cannot be held at a physical location, the Auction will be conducted via a virtual meeting (either telephonic or via videoconference). e. Bid Increments: $1 million f. Sale Hearing: Oct. 15, 2020 at 10:00 a.m. (ET) g. Sale Objection Deadline: Seven calendar days prior to the date of the Sale Hearing The dates and deadlines set forth in the Bidding Procedures Order are subject to modification by the Debtors in accordance with the Bidding Procedures. The Debtors are authorized to enter into the Stalking Horse Agreement, subject to higher or otherwise better offers at the Auction, and subject to the rights of the Committee and any other party in interest to assert any objections to the Sale on or prior to the Sale Objection Deadline or the Post-Auction Objection Deadline, as applicable. The Expense Reimbursement contained in the Stalking Horse Agreement is approved. The Sale Notice is approved. As soon as reasonably practicable following the entry of the Bidding Procedures Order, the Debtors will cause the Bidding Procedures Order, the Bidding Procedures, and Sale Notice to be served upon the Sale Notice Parties. The Assumption and Assignment Procedures are approved. Within three calendar days following the entry of the Bidding Procedures Order, the Debtors will file with the Court, and cause to be published on the Debtors' website maintained by Prime Clerk, the Cure Notice. The Contract Objection Deadline is 14 calendar days after service of the Cure Notice or Supplemental Cure Notice, as applicable. Notwithstanding the possible applicability of Bankruptcy Rules 6004(h), 6006(d), 7052, 9014 or otherwise, the terms and conditions of the Bidding Procedures Order will be immediately effective and enforceable upon its entry. A copy of the Stalking Horse APA and the Bidding Procedures is available at https://tinyurl.com/yy9zxe6x from PacerMonitor.com free of charge. About Global Eagle Entertainment Headquartered in Los Angeles, California, Global Eagle -- http://www.GlobalEagle.com/-- is a provider of media, content, connectivity and data analytics to markets across air, sea and land. Global Eagle offers a fully integrated suite of media content and connectivity solutions to airlines, cruise lines, commercial ships, high-end yachts, ferries and land locations worldwide. Global Eagle Entertainment Inc., based in Los Angeles, CA, and its debtor-affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11835) on July 22, 2020. The Hon. John T. Dorsey presides over the case. In the petition signed by CFO Christian M. Mezger, Global Eagle disclosed $630.5 million in assets and $1.086 billion in liabilities. Global Eagle tapped LATHAM & WATKINS LLP (CA), and YOUNG CONAWAY STARGATT & TAYLOR, LLP, as counsel; GREENHILL & CO., LLC, as investment banker; and ALVAREZ & MARSAL NORTH AMERICA, LLC, as financial advisor. PRIME CLERK LLC, is the claims and noticing agent. PRICEWATERHOUSECOOPERS LLP is the tax advisor. GNC HOLDINGS: Break-Up Fee in Harbin Deal Reduced ------------------------------------------------- On July 22, 2020, the Bankruptcy Court entered an order approving GNC Holdings, Inc., et al.'s bidding procedures which will be used in connection with the sale of substantially all of their assets. The Bidding Procedures Order required, among other things, the execution of a Stalking Horse Agreement no later than August, 4, 2020. The Debtors entered into a Stalking Horse Agreement (as amended from time to time) on August 7, 2020 with Harbin Pharmaceutical Group Holding Co., Ltd.), which was filed as Exhibit 10.11 to the Company’s Quarterly Report on Form 10-Q, filed on August 10, 2020. On August 15, 2020, the Company, on behalf of itself and the other Debtors, and Harbin entered into the First Amendment to the Stalking Horse Agreement (the "First Amendment"), pursuant to which either Harbin or the Company is permitted to terminate the Stalking Horse Agreement if (i) the Bidding Protections Order (as defined in the First Amendment) has not been entered by the Bankruptcy Court by August 20, 2020 or (ii) after its entry, the Bidding Protections Order ceases to be in full force and effect. Furthermore, on August 19, 2020, the Company, on behalf of itself and the other Debtors, and Harbin entered into the Second Amendment to the Stalking Horse Agreement, pursuant to which, among other things, (i) the outside date was extended from October 15, 2020 to October 31, 2020, (ii) the break-up fee payable by the Company under certain circumstances was reduced from $22.8 million to $15.2 million and (iii) the bid protection provisions were modified to provide that the Company will only be required to reimburse Harbin's expenses (but not pay the break-up fee) in the event that a restructuring transaction is consummated following a termination of the Stalking Horse Agreement as a result of (a) certain legal impediments described in the Stalking Horse Agreement, (b) the Bidding Procedures Order being withdrawn or (c) a sale order not being entered by September 24, 2020, in each case, subject to certain exceptions described in the Second Amendment. On August 19, 2020, the Bankruptcy Court entered (i) the Bidding Protections Order and (ii) an order modifying the Bidding Procedures Order to extend the date by which the Debtors were required to file the Stalking Horse Agreement from August 4, 2020 to August 7, 2020 to allow for the selection of Harbin as the stalking horse. About GNC Holdings Inc. GNC Holdings Inc. is a global health and wellness brand with a diversified omni-channel business. In its stores and online, GNC Holdings sells an assortment of performance and nutritional supplements, vitamins, herbs and greens, health and beauty, food and drink, and other general merchandise, featuring innovative private-label products as well as nationally recognized third-party brands, many of which are exclusive to GNC Holdings. Visit www.gnc.com for more information. GNC Holdings and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-11662) on June 23, 2020. Debtors disclosed $1,415,957,000 in assets and $895,022,000 in liabilities as of March 31, 2020. Judge Karen B. Owens oversees the cases. The Debtors tapped Young Conaway Stargatt & Taylor, LLP and Latham & Watkins, LLP as legal counsel; Evercore Group, LLC as investment banker and financial advisor; FTI Consulting, Inc. as financial advisor; and Prime Clerk as claims and noticing agent. Torys LLP is the legal counsel in the Companies' Creditors Arrangement Act case. GOODRICH QUALITY: Sept. 10 Hearing on Personal Property Sale ------------------------------------------------------------ Judge Scott W. Dales of the U.S. Bankruptcy Court for the Western District of Michigan will convene a hearing on Sept. 10, 2020 at 10:00 a.m. to consider Goodrich Quality Theaters, Inc.'s private sale of its interest in the Noblesville liquor license, its assumed trade name "Quality 10 GDX," and licenses in point of sale software with Vista Entertainment Solutions, Inc. to Emagine Holdings LLC for $20,000. The Objection Deadline is Sept. 7, 2020 at 4:00 p.m. (ET). The transfer of the Personal Property will be "as is, where is" and free and clear of all liens, interests and encumbrances. The Order, the Motion, and all documents related thereto will be served on (a) the United State Trustee, (b) the Debtor's secured lenders CIBC Bank, USA, Macatawa Bank, and Independent Bank, (c) the DIP Lender, (d) counsel for the Official Committee of Unsecured Creditors, (e) the Indiana Alcohol & Tobacco Commission, and (f) any parties that have filed notices of appearance or requests for notice by electronic mail, facsimile or first class mail to the best available address by no later than Aug. 20, 2020. In order to protect litigants, the public, and Court staff during the COVID-19 public health emergency, the court may, on short notice, decide to forbid attendance at the hearing in person and instead conduct any hearing by telephone. Accordingly, all persons who intend to participate in, or observe, the hearing scheduled in the hearing notice should consult the Court's website, https://www.miwb.uscourts.gov/covid-19-notices , shortly before the hearing to (i) determine whether in-person appearances will be permitted at the hearing; and (ii) receive instructions about how to participate in the hearing, or listen to it, by telephone. A copy of the Agreement is available at https://tinyurl.com/y2x5z3yj from PacerMonitor.com free of charge. About Goodrich Quality Theaters Goodrich Quality Theaters, Inc. -- http://www.gqti.com/-- owns and operates 30 theaters with 281 screens in cities throughout Michigan, Indiana, Illinois, Florida and Missouri. Goodrich Quality Theaters sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mich. Case No. 20-00759) on Feb. 25, 2020. At the time of the filing, the Debtor had estimated assets of between $50 million and $100 million and liabilities of between $10 million and $50 million. Judge Scott W. Dales oversees the case. The Debtor tapped Keller & Almassian, PLC as legal counsel; Stout Risius Ross Advisors, LLC as investment banker and Novo Advisors as financial advisor. GOODRX INC: S&P Raises ICR to 'B+' on Strong Operating Performance ------------------------------------------------------------------ S&P Global Ratings raised its issuer credit rating on Santa Monica, Calif.-based prescription drug price comparison platform provider GoodRx Inc. to 'B+' from 'B', reflecting the company's strong operating performance. Concurrently, S&P raised its rating on the company's revolving credit facility and first-lien term loan to 'BB-' from 'B,' and revised its recovery rating on the first-lien debt to '2' from '3'. The upgrade reflects improved credit metrics, underpinned by a record of profitable organic growth and the expectation that adjusted leverage will remain below 4x. Ongoing investments in product and marketing have continued to drive new users to GoodRx's platform, supporting 53.2% organic revenue growth and leverage reduction to 4x in the 12-month period ending June 30, 2020. At the same time, in response to a proactive approach on cash conservation surrounding COVID-induced uncertainty, the company pulled back on some of its marketing spending during the second quarter, after several consecutive quarters of investment. Despite its pared-back investment, GoodRx achieved 35% growth in the quarter, supporting the resilience in the business and demand for its services. S&P expects marketing spending to increase gradually over the remainder of the year, supporting S&P adjusted EBITDA margins of about 37% in 2020. At the same time, S&P forecasts revenue growth exceeding 35% this year, supporting a reduction in adjusted leverage to below 4x. GoodRx maintains strong free operating cash flow (FOCF) dynamics, driven by solid margins, and relatively modest working capital and capital expenditure needs. S&P expects free cash flow generation to exceed $120 million this year and may be directed toward acquisitions. After filing a confidential S-1 on Aug. 2, on Aug. 28, the company made its S-1 filing public. The company has not expressed an intent to reduce debt with IPO proceeds and S&P expects any forthcoming improvement in leverage to be earnings based. At the same time, S&P has not received any indication that the company's sponsors (SilverLake Partners, Francisco Partners and Spectrum Equity) will alter its stake in the company. GoodRx's relatively small scale, scope of service offerings, significant pharmacy benefit manager (PBM) concentration and financial sponsor ownership weigh on S&P's ratings. Relative to peers in the 'BB' rating category, GoodRx's relatively small scale and narrow business line in a highly competitive sector are limiting factors to the rating. S&P said, "GoodRx is also exposed to potential regulatory or competitive pressures to the PBM industry given the high concentration of claims generated with the top-three PBM networks (which S&P estimates to control about 70% of nationwide prescription market share). S&P's rating also reflects the company's ownership by private equity sponsors. Although S&P expects credit measures to improve, the risk for re-leveraging is high, given its view that financial sponsor-owned companies tend to maintain high leverage in order to maximize their investment return. Therefore, any potential upgrade to the rating would be dependent on the reduction of financial sponsor ownership to below 40%. S&P's stable outlook on GoodRx is based on its expectations for continued positive operating trends and improving credit metrics, maintaining adjusted leverage in the 3x-4x range over the next 12 months. S&P could raise the ratings over the next 12 months if: -- The company maintains adjusted leverage well below 3x and S&P expects the financial sponsors to relinquish control to less than 40% ownership over the intermediate terms; or -- S&P's view of the company's business prospects improves due to significant increases in scale and diversified services offerings. S&P could lower the rating over the next 12 months if: -- The company demonstrates an appetite for aggressive financial policies, including debt-financed dividend distributions or acquisitions that increase leverage above 4.0x on a sustained basis; or -- Business conditions deteriorated such that S&P expects EBITDA to decline by over 10%, causing leverage to remain above 4x. This may take place if the company were to experience unforeseen regulatory changes or loss of key PBM partners that hurt the company's business model. GRAND CANYON RANCH: Approval of Counsel's Contingency Fee Upheld ---------------------------------------------------------------- In the case captioned FANN CONTRACTING, INC., Appellant, v. GARMAN TURNER GORDON LLP., Appellee, Case No. 2:19-cv-00716-GMN (D. Nev.), Fann Contracting, Inc. appeals the Bankruptcy Court's order approving Garman Turner Gordon, LLP's application for contingency fee. Upon review, District Judge Gloria M. Navarro affirms the Bankruptcy Court's order. This case arises out of Debtor Grand Canyon Ranch, LLC's voluntary petition for relief under Chapter 11 of the Bankruptcy Code, filed on July 20, 2015. Early on in proceedings, the Bankruptcy Court appointed Brian D. Shapiro to act as the Chapter 11 Trustee. Mr. Shapiro then filed an application with the Bankruptcy Court to employ GTG as counsel to assist the Trustee pursuant to 11 U.S.C. section 327(a). For compensation, GTG proposed a contingency fee structure of 35% "calculated based on any sums recovered, held, or distributed by the estate, including the value of in-kind or nonmonetary distributions." That fee would rise to 40% if a reorganization plan were needed or 45% if the matter did not conclude until after a post-trial motion or notice of appeal. The Bankruptcy Court approved GTG's employment on March 15, 2016. Later in 2016, GTG proposed to the Bankruptcy Court a settlement between several interested parties to the bankruptcy petition. The settlement centered on the sale of a large area of real estate near the Grand Canyon known as the "Frontier," control of which by the Debtor was largely disputed. The terms of this potential settlement were that the "Canyon Rock Parties" would waive all claims to the Frontier and provide a $780,000 cash payment to the Bankruptcy Estate, after which the Frontier would be sold to an entity of the Canyon Rock Parties' choosing free and clear of all encumbrances. After prompting by the Bankruptcy Court to achieve a more global settlement, GTG negotiated a second settlement and sought the Bankruptcy Court's approval in April 2017. This second settlement involved the "Mared Parties" and the Canyon Rock Parties, and the terms involved a payment of $1.75 million to the Estate upon closing. In exchange for the payment, the Trustee would transfer to Mared: (i) the Frontier property, "free and clear of all liens, claims, and encumbrances, expressly including the Disputed Lease" and (ii) all of the Estate's remaining assets, including any of the Estate's personal property located on the Frontier, with the exception of the Estate's claims involving Appellant and Jim Barnes. With that $1.75 million payment, $900,000 would be paid to the Canyon Rock Parties as an "allowed secured claim." The Bankruptcy Court approved this second settlement on August 23, 2017, and no party appealed that decision. Following the Bankruptcy Court's approval of the second settlement, on Nov. 28, 2017, GTG filed an application requesting fees and expenses in the amount of $590,836.93 (including a voluntary reduction of fees by $50,000) based on the 35% contingency fee structure of employment. But Appellant objected to that requested fee, asserting that the First Fee Notice and Application was procedurally improper, calculated pursuant to a misguided base computation, and based upon representations that render the fee award improvident. The Bankruptcy Court overruled Appellant's objection and approved GTG's First Fee Notice and Application. Appellant then appealed that approval to the District Court on Dec. 27, 2017. On appeal, the District Court found that the bankruptcy court erred by not considering the appropriateness of GTG's compensation award through 11 U.S.C. section 330, which warranted vacating the Bankruptcy Court's approval of fees and remand for additional consideration. While on remand, the Bankruptcy Court held an evidentiary hearing to review GTG's requested fees and expenses for reasonability under section 330. The Bankruptcy Court ultimately approved GTG's requested 35-percent contingency fee based on the $1.75 million second settlement, amounting to fees for GTG of $612,500.00. The Bankruptcy Court further awarded expenses incurred by GTG in the amount of $32,522.85. Appellant timely appealed that approval order. In this appeal, Appellant argues that the Bankruptcy Court's analysis of GTG's attorney's fees and expenses under 11 U.S.C. section 330 was "fundamentally flawed" as a matter of both law and fact. The Bankruptcy Court erred as a matter of law, according to Appellant, by not considering the "results achieved" -- particularly, that GTG would recover the full amount of its requested fees and expenses while unsecured creditors like Appellant would receive no distribution. Appellant also claims that it was "per se unreasonable" for the Bankruptcy Court to allow GTG's contingency fee to include the value of property already owned by the Estate. Next, Appellant argues that the Bankruptcy Court erred by allowing GTG to justify its requested contingency fee with unnecessary work and time spent defending its application for fees. Last, Appellant claims the Bankruptcy Court erred by failing to reduce GTG's fees based on GTG's purported breaches of ethical obligations and conflicts of interest. The Court notes that 11 U.S.C. section 330(a) provides several factors to guide a bankruptcy court's analysis on the reasonable amount of attorney's fees for a professional employed in a Chapter 11 case, such as: the time spent on services; the rates charges for such services; whether the services were necessary to the administration of, or beneficial at the time at which, the service was rendered toward the completion of the case; and whether the services were performed within a reasonable amount of time commensurate with the complexity, importance, and nature of the problem, issue, or task addressed. Alongside those flexible factors, section 330 becomes resolute in section 330(a)(4)(A), instructing that a court "shall not allow compensation" for "unnecessary duplication of services" or services that were not "reasonably likely to benefit the debtor's estate" or "necessary to the administration of the case." Moreover, a professional like GTG hired to assist a bankruptcy trustee has a duty to scale back its services based on the reasonable expected outcome as set forth in In re Auto Parts Club, Inc., 211 B.R. 29, 34 (B.A.P. 9th Cir. 1997). Appellant argues that the Bankruptcy Court's section 330 analysis was flawed as a matter of law because it failed to consider how approving GTG's 35% contingency fee would mean over $600,000 in recovered fees while Appellant as an unsecured creditor would not recover any amount under the second negotiated settlement. Appellant argues that had the Bankruptcy Court's section 330 analysis properly considering this disparate result, it would have reduced GTG's fees and expenses to provide funds for unsecured creditors. Support for Appellant's position comes from In re Auto Parts Club, Inc., where the Bankruptcy Appellate Panel for the Ninth Circuit affirmed a reduction in attorney's fees on the ground that "[t]he [bankruptcy] estate should not be consumed by professional fees, especially where the unsecured creditors receive no distribution." However, contrary to Appellant's argument, the record shows that the Bankruptcy Court's section 330 analysis did consider how GTG would recover more than $600,000 in fees while Appellant as an unsecured creditor would not receive a distribution under the second settlement's terms. Not only did the Bankruptcy Court recognize that disparity, the Bankruptcy Court provided reasons why it was not fatal to GTG's request for the 35% contingency fee. For example, the Bankruptcy Court noted that GTG's settlement negotiations ensured a reduction in the unsecured creditor pool by $13 million. The Bankruptcy Court also discussed how GTG's efforts in negotiating the second settlement enabled Appellant to obtain $200,000 to pay unsecured creditors -- "thereby providing a greater return to all unsecured creditors, including [Appellant's] dominant unsecured claim." On appeal, Appellant does not point to evidence showing these factual findings to be clearly erroneous; and the record supports them. Accordingly, unlike In re Auto Parts Club, Inc., this is not a case where an employed professional neglected the interests of unsecured creditors when securing a resolution. Nor is this a case where the professional ran up costs and drained funds even after it became reasonably apparent that a better result was unlikely to occur. The Bankruptcy Court's section 330 analysis thus does not fail from the outset or as a matter of law for ignoring the "results achieved," and the Court does not find clear error in the Bankruptcy Court's decision to not reduce GTG's fees based on the results alone. Judge Navarro also addressed whether the Bankruptcy Court abused its discretion when conducting its section 330 reasonableness review and awarding GTG its 35% contingency fee amounting to $612,500 and expenses of $32,522.85. Addressing first the $124,000 for time GTG spent litigating in state court about the Barnes Lease, the Court does not find that the Bankruptcy Court abused its discretion in considering the litigation as necessary or beneficial to the Estate for purposes of section 330. Appellant's argument is that the second negotiated settlement transferred the Northern Parcel of the Frontier into the Estate then out of the Estate to make it "free and clear" for resale. Because the Estate had control of the entire Frontier property at one point during that transfer process, Appellant argues, the Trustee "simply needed to reject the Barnes Lease" to render the related state court litigation moot. However, the record does not support the feasibility of Appellant's proposed resolution. GTG provided evidence showing that the Estate did not have the ability to reject the Barnes Lease, that doing so would "increase[ ] the pool of unsecured claims to be asserted against this estate," and that the second settlement considered these facts. Appellant did not appeal the Bankruptcy Court's approval of that second settlement, so the specific findings about its terms being in the best interests of the Estate are not reviewable now. Accordingly, the Court does not find clear error with the Bankruptcy Court viewing fees spent on the Barnes Litigation as beneficial to the Estate and compensable for purposes of section 330. A copy of the Court's Memorandum Opinion dated July 27, 2020 is available at https://bit.ly/3iqg4rk from Leagle.com. About Grand Canyon Ranch Headquartered in Las Vegas, Nevada, Grand Canyon Ranch, LLC, filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 15-14145) on July 20, 2015. In the petition signed by Nigel Turner, manager, the Debtor estimated assets at between $1 million and $10 million and its liabilities at between $10 million and $50 million. Judge August B. Landis presided over the case. Matthew L. Johnson, Esq., at Johnson & Gubler, P.C., served as the Debtor's bankruptcy counsel. GRUPO AEROMEXICO: Court Approves Interim DIP Financing ------------------------------------------------------ Grupo Aeromexico, S.A.B. de C.V. (BMV: AEROMEX) reported Aug. 19, 2020, that the Company's DIP Financing Motion, filed on Aug. 13, 2020, was approved by Judge Shelley C. Chapman of the United States Bankruptcy Court for the Southern District of New York, a significant step forward in the Company's financial restructuring process initiated on June 30, 2020. The Chapter 11 Court authorized the Company to enter into an agreement with Apollo Global Management Inc. that formalized Apollo's commitment to fund up to US$1 billion in connection with the DIP financing facility. The DIP Facility approved by the Chapter 11 Court on an interim basis provides for a US$1billion secured superpriority multi-tranche debtor-in-possession term loan facility (the "DIP Facility"), contemplates (i) a senior secured Tranche 1 facility of US$200 million, and (ii) a senior secured Tranche 2 facility of US$800 million. Andres Conesa, CEO of Grupo Aeromexico, commented: "The Court approval obtained todaywasa critical milestone in the ongoing restructuring process for Aeromexico, and a recognition from all interested parties of Aeromexico's solid operating business and proven strategy. The DIP Facility will provide us with liquidity to meet our future obligations in a timely and orderly fashion, and to continue with our operations during and after the voluntary restructuring process. We recognize and appreciate the continuing support from all stakeholders." Based on theChapter 11 Court's interim approval of the DIP Facility, and subject to the fulfillment of customary conditions, up to US$100 million of the Tranche DIP Loans will be made immediately available. Upon entry of an order by the Chapter 11 Court granting final approval of the DIP Facility, and fulfillment of certain other conditions, the undrawn portion of the Tranche 1 and the Tranche 2 DIP Loans will be made available. It is anticipated that a final hearing before the Chapter 11 Court will occur by the end of September. Moreover, the Court also approved the Company's critical vendors and airline contracts motions (the "Motions") on a final basis and approved the Company's settlement (the "Settlement") with certain parties regarding the Series AERMXCB17 and AERMXCB19 CEBURES Senior Trust Bonds. The Court's approval of the Motions and Settlement was a significant step towards ensuring the Company's continued ability to seamlessly operate. We will continue pursuing, in an orderly manner, the voluntary process of financial restructuring under the Chapter 11 process, while we continue operating and offering services to our customers and contracting from our suppliers the goods and services required for operations. We will continue to use the advantages of the Chapter 11 proceeding to strengthen our financial position and liquidity, protect and preserve our operations and assets, and implement the necessary adjustments to face the impact of COVID-19. About Grupo Aeromexico Grupo Aeromexico, S.A.B. de C.V. -- https://www.aeromexico.com/ -- is a holding company whose subsidiaries are engaged in commercial aviation in Mexico and the promotion of passenger loyalty programs. Aeromexico, Mexico's global airline, has its main hub at Terminal 2 at the Mexico City International Airport. Its destinations network features the United States, Canada, Central America, South America, Asia and Europe. Grupo Aeromexico and three of its subsidiaries sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11563) on June 30, 2020. In the petitions signed by CFO Ricardo Javier Sanchez Baker, the Debtors reported consolidated assets and liabilities of $1 billion to $10 billion. The Debtors tapped Davis Polk & Wardwell LLP as their bankruptcy counsel, White & Case LLP and Cervantes Sainz, S.C., as special counsel, AlixPartners, LLP as financial advisor, and Epiq Bankruptcy Solutions as claims agent. SkyWorks Capital, LLC, serves as Debtors' financial advisor in connection with their aircraft fleet restructuring efforts. GRUPO AEROMEXICO: Reaches Deal With Short Term CEBURES Holders -------------------------------------------------------------- Grupo Aeromexico S.A.B. de CV (BMV: AEROMEX) said that on Aug. 18, 2020 an assembly was held between the Company and the holders of the Short Term Stock Certificates program (instruments with identification numbersAEROMEX01119, AEROMEX01219, AEROMEX 00120 and AEROMEX00220); in which was approved the Company's proposal to grant an extension and refrain from carrying out acts referring payments, because the waiting period was granted for a period of 12 months, beginning on Aug. 6, 2020 and until what occurs first of (i) the expiration of said 12-month period (that is, Aug. 6, 2021) and (ii) the date of approval, and effectiveness, of the restructuring plan to be presented by Aeroméxico to the United States Court for the Southern District of New York, by Judge Shelley C. Chapman, rector of the voluntary restructuring process under Chapter 11. As part of the agreement reached, Aeromexico agreed to recognize the outstanding debt under the instruments through the formal restructuring process under Chapter 11; provide information on the progress of the restructuring process; and convene assemblies of each Instrument, quarterly, at which Aeromexico will present to the holders of the respective Instruments the status of the restructuring process under Chapter 11 and any financial information and projections that have been made publicly available to any creditors, or any restructuring plan. The agreements mentioned previously will be effective as soon as approval is granted by the United States Court for the Southern District of New York. "Grupo Aeromexico appreciates the support and the confidence of the CEBURES holders. The agreement reached today with all relatedparties shows the confidence of the financial community in the company's restructuring plans and in the strength of its business model," said Andres Conesa, CEO of Aeromexico. About Grupo Aeromexico Grupo Aeromexico, S.A.B. de C.V. -- https://www.aeromexico.com/ -- is a holding company whose subsidiaries are engaged in commercial aviation in Mexico and the promotion of passenger loyalty programs. Aeromexico, Mexico's global airline, has its main hub at Terminal 2 at the Mexico City International Airport. Its destinations network features the United States, Canada, Central America, South America, Asia and Europe. Grupo Aeromexico and three of its subsidiaries sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11563) on June 30, 2020. In the petitions signed by CFO Ricardo Javier Sanchez Baker, the Debtors reported consolidated assets and liabilities of $1 billion to $10 billion. The Debtors tapped Davis Polk & Wardwell LLP as their bankruptcy counsel, White & Case LLP and Cervantes Sainz, S.C., as special counsel, AlixPartners, LLP as financial advisor, and Epiq Bankruptcy Solutions as claims agent. SkyWorks Capital, LLC, serves as Debtors' financial advisor in connection with their aircraft fleet restructuring efforts. HAJ PETROLEUM: Proposed Sale of South Elgin Property Approved ------------------------------------------------------------- Judge Donald R. Cassling of the U.S. Bankruptcy Court for the Northern District of Illinois authorized Haj Petroleum, Inc.'s sale of the real property located at 96 N La Fox St., South Elgin, Kane County, Illinois, Lot Size 93 X 196, PIN 0635158006, together with improvements located thereon, to Ayana, LLC for $600,000, subject to higher and better offers. In the event that the selected buyer is unable to close the sale, the Debtor will choose the next highest and best bidder and proceed to closing. St. Charles Bank & Trust Co. has a first priority secured interest in the real estate and business property being sold and will have the right to credit bid the amount of its allowed claim; and should the Bank become the prevailing bidder on its credit bid, the Bank will advance the customary costs of closing, the break-up fee unless the stalking horse bidder increase its bid during the auction process, broker's commissions, and any carve-out for costs of administration for attorney's and trustee fees as provided. St. Charles Bank consents to a carve-out from sale proceeds in the maximum sum of $20,000 for Subchapter V trustee fees and any allowed debtor's attorney fees reasonably incurred to preserve and dispose of the real estate and business property, but such consent is revocable by the Bank if the prevailing bid at the sale is less than $600,000. After deducting all closing costs, break-up fee (if applicable), broker's commissions and carve-out, all remaining net sales proceeds will be distributed to St. Charles Bank at closing. A hearing confirming the results of the Sale and asking an Order confirming the Sale will be held on Oct. 6, 2020 at 10:00 a.m. telephonically via Court Solutions, without further notice. For clarification purposes to correctly identify the stalking horse purchasers: They are: Aanya, for the real estate and for the business asset purchase, it is Aanu Gas, Inc. The Notice of the subject motion is deemed sufficient. The sale is will be free and clear of all Liens, Claims and Encumbrances. A copy of the Contract is available at https://tinyurl.com/yx9wrb6r from PacerMonitor.com free of charge. About Haj Petroleum, Inc. Haj Petroleum, Inc., owns and operates a gasoline station in South Elgin, IL. Haj Petroleum, Inc. filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 20-05403) on Feb. 27, 2020. In the petition signed by Mazhar Khan, president, the Debtor estimated $46,740 in assets and $1,100,114 in liabilities. Richard N. Golding, Esq. at THE GOLDING LAW OFFICES, P.C. represents the Debtor. HELEN E.A. TUDOR: $1.2M Sale of Chapman's Apalachicola Property OKd ------------------------------------------------------------------- Judge Karen K. Specie of the U.S. Bankruptcy Court for the Northern District of Florida authorized The Chapman House Museum, Inc. ("CHM"), an affiliate of Helen E.A. Tudor, to sell its real property located at 82 Sixth Street, Apalachicola, Florida, Parcel ID 01-09S-08W-8330-0022-0010, to JP Ferguson Properties, LLC for $1.21 million. The sale is free and clear of all liens, claims, encumbrances, and interests on the terms and conditions provided for in the Sale Contract. CHM has made sufficient allegations and a request in the Motion to waive the 14-day stay requirement of Bankruptcy Rule 6004(h). No objections being raised, the 14-day stay requirement of Rule 6004(h) is lifted immediately upon execution of the Order. Helen E.A. Tudor sought Chapter 11 protection (Bankr. N.D. Fla. Case No. 20-40068) on Feb. 19, 2020. The Debtors tapped Byron Wright, Esq., at Bruner Wright, P.A., as counsel. HERTZ CORP: Asks Bankruptcy Judge to Boot False-Arrest Suits ------------------------------------------------------------ Law360 reports that Hertz Corp. on July 17, 2020, sued 27 alleged victims of wrongful car-theft and false-arrest prosecutions by the company, seeking a Delaware bankruptcy court order staying their state lawsuits and mass tort damage claims and warning of risks to the company's $24 billion Chapter 11 restructuring effort. In an adversary suit filed in U.S. Bankruptcy Judge Mary F. Walrath's court, Hertz argued that the alleged victims' court actions against nondebtor companies, directors, officers and former stockholders would drain corporate resources and distract Hertz during critical early reorganization efforts, including efforts to line up debtor-in-possession financing for the case. About Hertz Corp. Hertz Corp. and its subsidiaries -- http://www.hertz.com/-- operate a worldwide vehicle rental business under the Hertz, Dollar, and Thrifty brands, with car rental locations in North America, Europe, Latin America, Africa, Asia, Australia, the Caribbean, the Middle East, and New Zealand. The Company also operates a vehicle leasing and fleet management solutions business. On May 22, 2020, The Hertz Corporation and certain of its U.S. and Canadian subsidiaries and affiliates filed voluntary petitions for reorganization under Chapter 11 in the U.S. Bankruptcy Court (Bankr. D. Del. Case No. 20-11218). The Hon. Mary F. Walrath is the presiding judge. White & Case LLP is serving as legal advisor, Moelis & Co. is serving as investment banker, and FTI Consulting is serving as financial advisor. Richards, Layton & Finger, P.A., is the local counsel. Prime Clerk LLC is the claims agent, maintaining the page https://restructuring.primeclerk.com/hertz IMAGEWARE SYSTEMS: Nantahala Capital Reports 9.1% Equity Stake -------------------------------------------------------------- In an amended Schedule 13D filed with the Securities and Exchange Commission, Nantahala Capital Management, LLC, Wilmot B. Harkey, and Daniel Mack disclosed that as of Aug. 20, 2020, they beneficially own 13,172,111 shares of common stock of Imageware Systems, Inc., which represents 9.1 percent of the shares outstanding. The Reporting Persons previously filed a Schedule 13G with respect to the Common Stock of the Issuer, as most recently amended with the SEC on Feb. 14, 2020, reporting that they beneficially owned 9.5% of the issued and outstanding shares of Common Stock. The aggregate percentage of Common Stock beneficially owned by the Reporting Persons is based upon 144,662,877 shares of Common Stock outstanding, which is the total number of shares of Common Stock outstanding as of Aug. 26, 2020. A full-text copy of the regulatory filing is available for free at: https://www.sec.gov/Archives/edgar/data/941685/000110465920100156/tm2029806d1_sc13da.htm About ImageWare Systems Headquartered in San Diego, CA, ImageWare Systems, Inc. -- http://www.iwsinc.com-- is a developer of mobile and cloud-based identity management solutions, providing two-factor, biometric and multi-factor cloud-based authentication solutions for the enterprise. The company delivers next-generation biometrics as an interactive and scalable cloud-based solution. ImageWare brings together cloud and mobile technology to offer two-factor, biometric, and multi-factor authentication for smartphone users, for the enterprise, and across industries. The Company's products are used to manage and issue secure credentials, including national IDs, passports, driver licenses and access control credentials. ImageWare recorded a net loss available to common shareholders of $17.25 million for the year ended Dec. 31, 2019, compared to a net loss available to common shareholders of $16.46 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $7.81 million in total assets, $13.80 million in total liabilities, $9.23 million in mezzanine equity, and a total shareholders' deficit of $15.22 million. Mayer Hoffman McCann P.C., in San Diego, California, the Company's auditor since 2011, issued a "going concern" qualification in its report dated May 15, 2020 citing that the Company does not generate sufficient cash flows from operations to maintain operations and, therefore, is dependent on additional financing to fund operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. IMH FINANCIAL: JPM to Get 100% of Common Shares in Plan Deal ------------------------------------------------------------ On July 23, 2020, IMH Financial Corporation entered into a Restructuring Support Agreement with (i) JPMorgan Chase Funding Inc. ("JPM"), the holder of all of the shares of the Company's Series A Senior Preferred Stock and all of the shares of the Company's Series B-2, B-3 and B-4 Cumulative Convertible Preferred Stock, (ii) JCP Realty Partners, LLC ("JCP Realty"), Juniper Capital Asset Management, LLC ("JCAM"), Juniper NVM, LLC ("JNVM"), and Juniper Investment Advisors, LLC ("JIA") (collectively, the "Juniper Parties"), and (iii) ITH Partners, LLC and Lawrence D. Bain (collectively, the "Bain Parties") (the Company, the Juniper Parties and the Bain Parties, collectively, the "Principal Parties"). The Restructuring Support Agreement contemplates agreed-upon terms for a pre-arranged financing plan (the "Plan") in a proceeding commenced by the Company on July 23, 2020 in the United States Bankruptcy Court for the District of Delaware under chapter 11 of title 11 of the United States Code to be based on the Restructuring Term Sheet dated June 11, 2020 (the "Restructuring Term Sheet") from the Company to JPM and JCP Realty Partners (such transactions described in, and in accordance with the Restructuring Support Agreement and the Restructuring Term Sheet, the "Restructuring Transactions") which, among other things, contemplates that the Company shall be reorganized following the Plan Effective Date (the "Reorganized Company") under the terms and conditions of the Plan and the order entered by the Bankruptcy Court in the Bankruptcy Case confirming the Plan pursuant to section 1129 of the Bankruptcy Code (the "Confirmation Order"). The Restructuring Support Agreement, which became effective on July 23, 2020, provides, among other things, for the following terms and conditions of the Restructuring Transactions: * The Company obtaining confirmation of the Plan, on terms consistent with the Restructuring Support Agreement and the Restructuring Term Sheet, no later than 120 calendar days after commencement of the Bankruptcy Case (the “Petition Date”); * The Company obtaining a senior secured super-priority debtor-in-possession financing facility in the approximate amount of $10.15 million or such other amount as may be consistent with the Budget (the "DIP Facility"), which amount includes an interim debtor-in-possession financing request of up to $1.9 million, to be provided by JPM to the Company; * Subject to the satisfaction of customary conditions precedent for a loan of this nature, including, but not limited to, the entry by the Bankruptcy Court of a Confirmation Order in form and substance satisfactory to JPM, the Company and JPM entering into a senior secured term loan exit facility (the "Exit Facility") in an amount up to $71.0 million to (i) fund the Company's obligations under the Plan; (ii) refinance the DIP Facility; (iii) to fund the Company's ongoing obligations and working capital requirements after the date of the order entered by the Bankruptcy Court confirming the Plan (the "Plan Effective Date"); and (iv) to the extent that the Company's obligations with respect to the secured loan in the principal amount of $37.0 million made by the MidFirst Bank (the "Hotel Loan") to L'Auberge de Sonoma, LLC, (the "Hotel Owner") are not otherwise satisfied, to refinance the Hotel Loan (the "Hotel Refinancing"), such Hotel Refinancing (A) to be on terms and conditions acceptable to JPM in its sole discretion and (B) may be funded, at JPM's election, through the Exit Facility or pursuant to a separate credit facility. To the extent that the Hotel Refinancing occurs on the date of the closing of the Exit Facility "Exit Facility Closing Date"), but is not funded through the Exit Facility, the amount of the Exit Facility will be reduced by $37.0 million; * The Company paying to the holders of the Company's Series B-1 Cumulative Convertible Preferred Stock (the "Series B-1 Preferred Stock") all dividends thereon (with interest, if any) that have accrued and remain unpaid as of the commencement of the Bankruptcy Case on the Petition Date; * The holders of the Series B-1 Preferred Stock, other than JPM, receiving on the Plan Effective Date, pro rata, the aggregate sum of $8,912,519 in cash, representing the redemption of all of the Series B-1 Preferred Stock of such holders, other than JPM, at par, in and final satisfaction, settlement, release, and discharge of, and in exchange for such Series B-1 Preferred Stock and all related claims or other rights; * JPM receiving 100% of the new common stock of the Reorganized Company, on the Plan Effective Date, in full and final satisfaction of all Preferred Stock held by JPM, with aggregate redemption value of $71,300,347, in full and final satisfaction, settlement, release, and discharge of, and in exchange of, such Preferred Stock and any and all related claims or other rights; * In the event that the holders of the common stock of the Company (that is not treasury stock) (the "Common Stock") votes to accept the Plan under Section 1126(d) of the Bankruptcy Code, the holders of Common Stock in the Company shall receive, pro rata, an aggregate cash payment of not less than $5,012,462 and not more than $7,518,694 (the "Common Equity Distribution") as more particularly described in the RSA, a copy of which is attached to this Report; * All cash payments received by the class of interests under the Plan comprising all Common Stock (the "Common Equity Class") shall be in full and final satisfaction, settlement, release, and discharge of, and in exchange for, their interests and all related claims or other rights, including any claims that are determined to be subordinated to the status of an equity security, whether under general principles of equitable subordination, section 510(b) of the Bankruptcy Code, or otherwise, and all such interests and related claims and rights shall be cancelled on the Plan Effective Date. Notwithstanding the foregoing, in the event that the Common Equity Class votes to reject the Plan under section 1126(d) of the Bankruptcy Code, then the holders of the Common Stock shall receive no distribution under the Plan on account of their interests, including any claims that are determined to be subordinated to the status of an equity security, whether under general principles of equitable subordination, section 510(b) of the Bankruptcy Code, or otherwise, and all such interests and related claims and rights shall be cancelled on the Plan Effective Date. The Plan shall specify the Common Equity Class as an impaired class; * In the event that the class of interests under the Plan comprising all of the outstanding stock warrants ("Warrants") of the Company (the "Warrants Class") votes to accept the Plan under section 1126(d) of the Bankruptcy Code, the holders of Warrants issued by the Company shall receive, pro rata, an aggregate cash payment of $52,000, on the Plan Effective Date. All cash payments received by the Warrants Class shall be in full and final satisfaction, settlement, release, and discharge of, and in exchange for, such interests and all related claims or other rights, including any claims that are determined to be subordinated to the status of an equity security, whether under general principles of equitable subordination, Section 510(b) of the Code, or otherwise, and all such interests and related claims and rights shall be cancelled on the Plan Effective Date. Notwithstanding the foregoing, in the event that the Warrants Class votes to reject the Plan under Section 1126(d) of the Code, then the holders of such Warrants shall receive no distribution under the Plan on account of such interests, including any claims that are determined to be subordinated to the status of an equity security, whether under general principles of equitable subordination, Section 510(b) of the Code, or otherwise, and all such interests and related claims and rights shall be cancelled on the Plan Effective Date. The Plan shall specify the Warrants Class as an impaired class; * If, at the Company's request, JCP Realty communicates with the holders of Common Stock or Warrants and expends material resources, on a best efforts basis, assisting the Company and the Company’s retained professionals in the Company’s solicitation of votes for the acceptance or rejection of the Plan from such holders consistent with section 1126(d) of the Bankruptcy Code, then the Company will reimburse JCP Realty for such efforts and expenses by paying JCP Realty a flat fee of $100,000 on the Plan Effective Date as authorized by the Confirmation Order; * The Company and JIA, on or before the Petition Date, enter into an Amended and Restated Non-Discretionary Investment Advisory Agreement (the "Amended and Restated JIA Agreement"), which the Company shall assume pursuant to the Plan and which shall become effective on and subject only to the occurrence of the Plan Effective Date. The form of the Amended and Restated JIA Agreement to be assumed and accepted by the Reorganized Company to be disclosed to the Bankruptcy Court in the Disclosure Statement with respect to the Plan (the "Disclosure Statement"); * The Company redeeming the holders of the preferred limited liability company interests (the "Hotel Fund Investors") in L’Auberge de Sonoma Resort Fund, LLC, a Delaware limited liability company (the "Hotel Fund"), on terms and conditions acceptable to JPM in its sole discretion, to be effectuated on or after the Plan Effective Date (the "Hotel Fund Redemption"), JPM to fund the Hotel Fund Redemption pursuant to a separate credit facility with Hotel Owner in an original principal amount not to exceed $22.5 million, on terms and conditions consistent with the Restructuring Support Agreement and in all other respects acceptable to JPM in its sole discretion (the "Hotel Redemption Facility"); * JCAM providing certain administrative services to assist the Company in coordinating the Hotel Fund Redemption pursuant to which the Company shall pay JCAM a fee of $300,000 on the Plan Effective Date or such lesser amount as is set forth in the Hotel Administrative Services Agreement (as defined in the Restructuring Support Agreement); * Cash payment in full of all secured claims and general unsecured claims on the later of the Plan Effective Date or the date such payment is due in the ordinary course, reinstatement of such claims pursuant to section 1124 of the Bankruptcy Code or other such treatment rendering such claims unimpaired, in each case, at the option of the Company and with JPM’s consent; * As of the Plan Effective Date, the Reorganized Company and its key management will enter into new employment and other management arrangements covering, without limitation, base salary, bonus, and executive benefits, provided that such management personnel agree to, among other things, vote any interests held by them to accept the Plan under Section 1126(d) of the Bankruptcy Code and to not take any action inconsistent in any material respect with, or intended to frustrate or impede approval, implementation and consummation of, the Restructuring Transactions; * The Principal Parties shall support the DIP Facility, the Plan and confirmation of the Plan, and shall timely vote to accept the Plan (to the extent that they hold claims or interests entitled to vote with respect to the Plan) provided that the material terms of the Plan are consistent with the Restructuring Term Sheet; and * JPM may terminate the Restructuring Support Agreement on the occurrence of certain events, including, but not limited to, the following: (i) a material breach by any other party to the Restructuring Support Agreement of such party’s obligations, undertakings, representations, warranties or covenants under the Restructuring Support Agreement, any such breach is not cured (to the extent curable) within seven (7) business days after the date of such notice; (ii) the Company pursues, proposes or otherwise supports, or fails to actively oppose, any (A) restructuring of the Company’s obligations, other than in the Bankruptcy Case on the terms and conditions set forth in the Restructuring Support Agreement, (B) amendment or modification to the Plan, the Disclosure Statement or any other Definitive Document (as defined in the Restructuring Support Agreement) that, in whole or in part, is inconsistent with the Restructuring Support Agreement in any material respect, or (C) the withdrawal of the Plan; (iii) an event occurs (including the granting of any relief by the Bankruptcy Court, but excluding the filing of the Bankruptcy Case) that has, or is reasonably expected to have, a material adverse effect on (X) the business, assets or financial condition of the Company, in each case taken as a whole, or (Y) the reasonable likelihood of the consummation of the Restructuring Transactions consistent with this Agreement, and in the case of any such inconsistent relief granted by the Bankruptcy Court, such relief is not sought to be dismissed, vacated or modified to be consistent with the Restructuring Support Agreement within seven (7) business days after the date of such notice; (iv) the failure by the Company to provide to JPM and its advisors, reasonable access to (AA) the books and records of or relating to the Company and (BB) the Company’s management and advisors for the purposes of evaluating its business plans and participating in the process with respect to the consummation of the Restructuring; (v) the Company pursues, proposes or otherwise supports, or fails to actively oppose, any debtor-in-possession financing or the use of cash collateral other than pursuant to the DIP Facility; (vi) the failure by the Company to provide to JPM and its advisors, reasonable access to (XX) the books and records of or relating to the Company and (YY) the Company’s management and advisors for the purposes of evaluating its business plans and participating in the process with respect to the consummation of the Restructuring; (vii) the Company engages in any merger, consolidation, disposition, acquisition, investment, dividend, incurrence of indebtedness or other similar transaction outside the ordinary course of business, other than in the Bankruptcy Case to effectuate the Restructuring; (viii) the issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of a final, non-appealable ruling or order (aa) enjoining the entry of the Confirmation Order, the consummation of the Restructuring, or the occurrence of the Plan Effective Date, or (bb) finding the Restructuring Support Agreement to be invalid or unenforceable in material part; or (ix) the occurrence of an “Event of Default” under, or the termination of, the DIP Facility, after giving effect to any applicable cure rights. About IMH Financial Corporation IMH Financial Corporation -- https://www.imhfc.com/ -- is a real estate investment holding company. The Company's most significant real estate assets include: (a) a luxury hotel located in Sonoma, California, and (b) thousands of acres of undeveloped real property and related water rights located outside of Albuquerque, New Mexico. The Company's real estate investments are located primarily in the southwestern part of the United States, and are held by wholly-owned or indirectly wholly-owned subsidiaries, none of which are in bankruptcy. IMH Financial Corporation filed for bankruptcy protection (Bankr. D. Del., Case No. 20-11858) on July 23, 2020. The petition was signed by Chadwick S. Parson, chairman and CEO. Hon. Brendan Linehan Shannon presides over the case. The Debtor estimated $100 to $500 million in assets and liabilities. Ashby & Geddes PA and Snell & Wilmer LLP have been tapped as bankruptcy counsel to the Debtor. Donlin, Recano & Co., Inc. is the Debtor's claim and noticing agent. JASON HOLDINGS: S&P Assigns CCC+ ICR on Bankruptcy Exit ------------------------------------------------------- S&P Global Ratings assigned a 'CCC+' issuer credit rating to Milwaukee, Wis.-based industrial manufacturing company Jason Holdings Inc. after the company emerged from Chapter 11 bankruptcy as a new legal entity. The outlook is negative. S&P is also assigning a 'B-' issue-level rating and '2' recovery rating to subsidiary Jason Group Inc.'s $76.6 million first-lien senior secured term loan. The '2' recovery rating indicates S&P's expectation for substantial (70%-90%; rounded estimate: 70%) recovery in the event of a payment default. At the same time, S&P is assigning a 'CCC-' issue-level rating and '6' recovery rating to Jason Group Inc.'s senior secured second-lien convertible term loan. The '6' recovery rating indicates S&P's expectation for negligible (0%-10%; rounded estimate: 5%) recovery in the event of a payment default." Despite the reduction in debt following the company's emergence from bankruptcy, S&P expects leverage will remain elevated. The company's post-emergence capital structure consists of an unrated $30 million asset-based lending (ABL) facility, a $76.6 million first-lien term loan, and a $50 million second-lien convertible term loan. Jason may elect to pay a portion of the interest in kind on either term loan. The first lien term loan allows for 400 basis points (bps) paid-in-kind (PIK) interest and the second-lien term loan allows for 900 bps PIK interest. S&P's rating reflects the company's lower debt-service costs and improved maturity schedule following the reduction of approximately $244 million of debt achieved through the Chapter 11 bankruptcy process. S&P expects Jason will maintain sufficient available liquidity post-emergence to meet its near-term debt obligations. However, despite Jason's reduced debt burden, S&P forecasts the company's leverage will remain elevated above 15x through 2020 given the significant EBITDA degradation as a result of the COVID-19 pandemic, high proportion of fixed costs in its total production costs, ongoing restructuring costs, and challenging demand conditions. Further, S&P expects Jason's outstanding debt to increase marginally per year due to its rising debt balance from the build-up of accrued non-cash PIK interest on its second-lien term loan. The COVID-19 pandemic has adversely affected Jason's operating results, and the full extent of the impact is still uncertain. Declining demand for the company's products, which began in 2019 as a result of weak economic conditions in Europe and Asia, lower industrial production in North America, and softening OEM customer demand, has been exacerbated by the impact of the COVID-19 pandemic. Organic sales declined 26.4% in the first half of 2020, with the decline accelerating in the second quarter. For the three months ended June 30, 2020, organic sales declined of 39.2%. The pandemic also caused disruptions in its manufacturing facility and support operations and affected its supply chain. In response, the company has taken several steps to preserve liquidity including furlough programs, compensation reductions, and rent deferrals. As the pandemic continues to evolve, the extent of the impact on the company's business, operating results, and cash flows will depend on the duration and spread of the pandemic, its severity, actions to contain the virus, and customer spending levels. Performance improvement is contingent on the successful implementation of Jason's go-forward business plan initiatives. S&P expects Jason to continue executing on its previously implemented global cost reduction and restructuring efforts through 2021. As part of the company's portfolio management and strategic alternatives review process it divested certain non-core assets which reduced the cyclicality of the business, streamlined its product focus, and simplified its portfolio to its two primary business segments—industrial and engineered components. Although S&P expects end-market conditions to remain challenging, the company believes its realigned focus allows it to capitalize on sustainable, long-term growth opportunities in markets such as commercial turf care and autonomous ride sharing. S&P believes operating initiatives including labor cost reductions, footprint rationalization activities, and margin expansion efforts will improve the company's cost structure and increase profitability. Additional facility closures in higher-cost markets, existing shop floor improvements, and increased investment in automation enable the company to consolidate and/or shift production, fill capacity, and increase utilization in existing facilities while reducing operating costs. While it expects earnings to improve in the second half of 2020, and through 2021, S&P recognizes meaningful execution risk associated with the company's ability to achieve its business plan and return to profitability amidst recessionary pressures and a recovering demand environment. The negative outlook reflects the risk that further disruption from the COVID-19 pandemic or prolonged weak economic conditions, along with higher-than-expected costs to implement its business improvement initiatives, could contribute to lower earnings and a greater cash flow shortfall over the next 12 months. S&P could lower its rating on Jason if: -- S&P believed the company were likely to default because of a near-term liquidity crisis or consider a distressed debt exchange within 12 months. It believes this could occur if the company is unable to improve its operating performance and greater than expected negative cash flow generation after funding its working capital requirements, committed growth capital expenditures, and debt service costs constrains liquidity and leads to limited availability under its ABL facility. S&P could raise its rating on Jason if: It successfully executes its cost reduction plan and improves its operating performance such that S&P believed the company is capable of generating sustained positive free cash flow. JUAN L. LARINO: $510K Sale of Newark Property to Vorhand Approved ----------------------------------------------------------------- Judge Stacey L. Meisel of the U.S. Bankruptcy Court for the District of New Jersey authorized Juan Luis Larino's sale of the real property he jointly owns with Neil Gelardo located at 41-43 Manufacturer's Place, Newark, New Jersey Eli Vorhand for $510,000. A hearing on the Motion was held on Aug. 25, 2020 at 11:00 a.m. The sale is free and clear of all Liens and Claims, with any Liens and Claims to attach only to the Debtor’s interest in the net sale proceeds. Customary closing adjustments payable by the Debtor for municipal charges or assessments will be satisfied from the proceeds of the Sale at closing. The Debtor will pay the Special Counsel a flat fee of $2,500 from the sale proceeds without a separate application for compensation. The following allowed secured claims will be paid in full at the closing of the Property: 41-41 Manufacturer's Place, Newark, New Jersey Mortgage lien held by ConnectOne Bank in the amount of $331,305 (Proof of Claim No. 2), plus any interest accrued and outstanding thereon through the date of closing. The Debtor will be required to make further application to the Court for release of any funds held in escrow following the closing, including attorney fees. The Debtor's half interest in the net sale proceeds from the sale of the Property will be held in the Debtor's Bankruptcy Counsel's Trust Account pending confirmation of a Chapter 11 Plan of Reorganization or further order of the Court. The co-owner's half interest in the net sale proceeds from the Sale of the Property will be turned over to the Standing Chapter 13 Trustee in the co-owner's bankruptcy case currently pending in the Southern District of New York (Case No. 19-23154). Notwithstanding Bankruptcy Rule 6004(h), the Order authorizing the sale of real property will not be stayed for 14 days after the entry hereof, but will be effective and enforceable immediately upon entry. A true copy of the Order will be served on all parties who received notice of the Motion, within seven days from its entry. A copy of the Agreements is available at https://tinyurl.com/ycmu7goh from PacerMonitor.com free of charge. Juan Luis Larino sought Chapter 11 protection (Bankr. D. N.J. Case No. 19-30898) on Nov. 4, 2019. The Debtor tapped David L. Stevens, Esq., at Scura, Wigfield,, Heyer & Stevens as counsel. LAKELAND TOURS: WorldStrides Sees October Emergence --------------------------------------------------- Wina News reports that three years after being acquired by Paris-based Eurazeo SE and China's Primavera Capital, Charlottesville-based WorldStrides has filed a voluntary Chapter 11 bankruptcy in New York. The proceeding will enable the two overseas holding companies to sell back the local company back to its owners. WorldStrides was formed here in 1967 and has since become the largest educational travel company in the United States, operating those tours under the name Lakeland Tours, LLC. A company release says they expect to emerge from Chapter 11 by October after "a comprehensive recapitalization with its principal shareholders and certain lenders." They expect to be able to reduce debt and secure new financing and will continue to pay their more than 1,000 employees worldwide, fully pay their vendors, and continue paying customer refunds for trips that cannot occur because of COVID-19. President and CEO Robert Gogel says their "industry has been at a standstill due to the pandemic." About Lakeland Tours Lakeland Tours, LLC and its affiliates, including WorldStrides Holdings, LLC, provide full-service educational travel and experiential learning programs domestically and internationally for students from K12 to graduate level. They are one of the largest accredited U.S. travel companies, providing organized educational travel and other experiential learning programs for more than 550,000 students in 2019. WorldStrides is the largest and most trusted student educational travel company in the country. WorldStrides has provided a variety of educational travel programs to more than two million elementary, middle, and high school students since its inception in 1967. Lakeland Tours and certain of its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-11647) on July 20, 2020. Kellie Goldstein, chief financial officer, signed the petitions. At the time of the filing, the Debtors had consolidated assets of $1 billion to $10 billion and consolidated liabilities of $1 billion to $10 billion. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International, LLP as their bankruptcy counsel, KPMG LLP as financial advisor, Houlihan Lokey Capital Inc. as investment banker, and Daniel J. Edelman Holdings Inc. as communications consultant and advisor. Stretto is Debtors' notice and claims agent. LAKEWAY PUBLISHERS: $303K Sale of Ultranet Subdvision Approved -------------------------------------------------------------- Judge Marcia Phillips Parsons of the U.S. Bankruptcy Court for the Eastern District of Tennessee authorized Lakeway Publishers, Inc.'s sale of property of the estate which consists of its "Ultranet" subdivision for not less than $302,650. Pinnacle Bank filed an objection prior to hearing. The parties have agreed that the assets may be sold for not less than $302,650 pursuant to the terms of the original asset purchase agreement filed as an exhibit to the motion. They have further agreed that all proceeds from the sale will be paid into the trust Account of Winchester, Sellers & Foster as soon as the closing is complete. Winchester, Sellers & Foster may distribute the funds to Pinnacle Bank as they are received as Lakeway Publishers waives their original argument that the sale should occur free and clear of liens. As a result, there are no additional issues to brief on the subject. About Lakeway Publishers Lakeway Publishers, Inc., is a multi-state publisher of newspapers, magazines and special publications. Lakeway owns and operates community newspapers and magazines in Tennessee, Missouri, Virginia, and Florida. Lakeway Publishers was incorporated in 1966 and is based in Morristown, Tenn. Lakeway Publishers, Inc., and affiliate Lakeway Publishers of Missouri, Inc. each filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tenn. Lead Case No. 19-51163) on May 31, 2019. In the petitions signed by Jack R. Fishman, president, Lakeway Publishers, Inc., disclosed $20,884,027 in assets and $9,245,645 in liabilities while Lakeway Publishers of Missouri listed $7,047,972 in assets and $9,206,193 in liabilities. The Debtors tapped Quist, Fitzpatrick & Jarrard, PLLC, led by Ryan E. Jarrard, as bankruptcy counsel; and Burnette Dobson & Pinchak, as special counsel. LATAM AIRLINES: Court OKs $9.8M Breakup Fee on $1.3B Loan --------------------------------------------------------- Law360 reports that a New York bankruptcy judge on July 22, 2020, approved a $9.75 million breakup fee for a prospective LATAM Airlines Group debtor-in-possession lender on a $1.3 billion loan, saying the airline should be allowed to honor the bargain it had struck with the lender. In a bench ruling issued during a hearing by phone, U.S. Bankruptcy Judge James Garrity Jr. dismissed creditor arguments that the breakup fee was unnecessary for LATAM to secure the financing from Oaktree Capital Management, saying it was a reasonable part of the deal LATAM and Oaktree had struck. About LATAM Airlines LATAM Airlines Group S.A. -- http://www.latam.com/-- is a pan-Latin American airline holding company involved in the transportation of passengers and cargo and operates as one unified business enterprise. LATAM Airlines Group S.A. is the largest passenger airline in South America. Before the onset of the COVID-19 pandemic, LATAM offered passenger transport services to 145 different destinations in 26 countries, including domestic flights in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, and international services within Latin America as well as to Europe, the United States, the Caribbean, Oceania, Asia and Africa. LATAM Airlines Group S.A. and its 28 affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United States are part of the Chapter 11 filing. The Debtors disclosed $21,087,806,000 in total assets and $17,958,629,000 in total liabilities as of Dec. 31, 2019. The Hon. James L. Garrity, Jr., is the case judge. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as general bankruptcy counsel; FTI Consulting as restructuring advisor; and Togut, Segal & Segal LLP and Claro & Cia in Chile as special counsel. Prime Clerk LLC is the claims agent. LEARFIELD COMMUNICATIONS: Moody's Rates First Lien Term Loan 'B3' ----------------------------------------------------------------- Moody's Investors Service assigned a B3 rating to Learfield Communications, LLC's proposed $125 million first lien term loan. The Caa1 Corporate Family Rating, Caa1-PD Probability of Default Rating (PDR), B3 rating on the existing first lien credit facility, and Caa3 second lien term loan rating are unchanged. The outlook remains negative. The transaction will be used to add cash to the balance sheet, fund deferred rights fees, and support operations. Pro forma cash will be over $90 million. The incremental facility will have a Libor plus 13% interest spread (3% cash and 10% annual PIK). The net proceeds will provide additional capacity to operate as college sports continues to be disrupted by the coronavirus outbreak. The Pac 12 and Big 10 conferences have already cancelled the fall college football season, while three of the remaining large conferences plan to start the fall season, albeit with limited fans in attendance. Both the college football and basketball seasons have the potential to be further disrupted by an increase in cases in any region or among the athletes. Assignments: Issuer: Learfield Communications, LLC New Senior Secured First Lien Term Loan B-1, assigned a B3 (LGD3) RATINGS RATIONALE Learfield's Caa1 CFR reflects very high leverage of over 10x as of March 31, 2020 (excluding Moody's standard lease adjustment), which Moody's expects will increase further due to the disruption of college athletics by the pandemic and lower advertising spending amidst a weak economic environment. Following the merger with IMG College in December 2018, Learfield was already facing challenging conditions from higher multimedia rights costs and lower than anticipated sponsorship revenue after an extended regulatory review process that slowed sponsorship sales. Learfield also has a substantial amount of guaranteed payments over a multiyear period with its college media rights partners and a relatively high level of fixed costs, although the company has been converting many of its fixed obligations to a more variable model going forward. Learfield has limited tangible assets with the company's value driven largely by the intellectual capital of management, long term business relationships, and contracts with college athletic programs and organizations. College football and basketball account for a significant amount of revenue and Learfield's performance would be substantially impacted by any additional cancellations or delays of the season of either sport. Despite the smaller size of many competitors, competition for collegiate sports rights has been high and colleges have sought increased fees for their media rights historically which can pressure profitability if the higher costs are not offset with growth in sponsorship revenue. Learfield benefits from the strong fan base for college sports and the underpenetrated nature of college media rights compared to professional sports. The merger with IMG College materially increased the size of the college multimedia rights division and provided revenue and cost synergies, but results following the merger were weaker than projected due in part to the uncertainty caused by an extended regulatory review process. Learfield has had good renewal rates with its university base historically, long contract periods, and a substantial amount of pre-sold ad inventory, but operations will be disrupted until the impact of the pandemic subsides. The rapid spread of the coronavirus outbreak, deteriorating global economic outlook, low oil prices, and high asset price volatility have created an unprecedented credit shock across a range of sectors and regions. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Given Learfield's exposure to collegiate sports, the company remains vulnerable to shifts in market demand and sentiment in these unprecedented operating conditions. A governance consideration that Moody's considers in Learfield's credit profile is its aggressive financial policy historically. Learfield has operated with elevated leverage levels and has pursued several acquisitions including the IMG college merger. In the near term, Moody's expects the company will be focused on preserving liquidity and improving operations. Learfield is a privately owned company. Moody's considers Learfield's liquidity position as weak due to the expectation of negative free cash flow (FCF) for as long as college sporting events are disrupted. Cash on the balance sheet will be over $90 million and the $125 million revolving credit facility due December 2021 will be fully drawn pro forma for the transaction as of March 31, 2020. Learfield also has access to a $58 million receivables-based credit facility due December 2021 that will provide additional funding to Learfield in the beginning September and October 2020. FCF has been negative since the acquisition of IMG College and will remain so until college sports can operate as scheduled and without restrictions in attendance levels. Learfield is required to make future minimum payments to the universities that it has multimedia rights contracts, but the company has taken steps to minimize the amount and manage the timing of payments to its multimedia rights partners in the near term. Nevertheless, liquidity will likely deteriorate over the next several quarters. Moody's expects that additional sources of liquidity may be needed if the pandemic continues to affect colleges' ability to host sporting events. Learfield completed an amendment to its revolving credit facility in June 2020 that waives the financial maintenance covenant applicable to the revolver until the maturity of the revolver in 2021, but subjects the company to a $10 million minimum liquidity requirement. The first and second lien term loans are covenant lite. The negative outlook reflects Moody's expectation that liquidity, revenue and EBITDA will decline significantly due to the coronavirus outbreak's impact on the ability to hold college sporting events and lower sponsorship revenues in the near term, which elevates the risk of a default. Further cancellations or delays of the college football or basketball season would have a substantial impact on performance and liquidity and increase the need for additional sources of funding. Moody's projects leverage levels will remain at very high levels for an extended period of time even after college sports resumes normal operations after the outbreak subsides, which will leave Learfield vulnerable to any future decline in the economy or period of weak operating performance. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be downgraded if there was insufficient liquidity which elevates concerns about Learfield's ability to service its debt from issues stemming from the pandemic's effect on operations or if the likelihood of a distressed exchange increases. Additional debt issued to fund operations may also lead to a downgrade as would an inability to extend the maturity of the revolver (matures December 2021) well in advance of the maturity date. An upgrade of Learfield's ratings is not likely in the near term due to the very high leverage level and challenging economic conditions due to the coronavirus outbreak. However, ratings could be upgraded if Learfield improves liquidity to adequate levels with leverage sustained below 7.5x (as calculated by Moody's). All approaching debt maturities would also need to be extended. Learfield Communications, LLC (Learfield) (dba Learfield IMG College) is an operator in the collegiate sports multimedia rights and marketing industry. Atairos Group, Inc. acquired the company in December 2016 from Providence Equity Partners, Nant Capital, and certain members of management. In December 2018, Learfield completed a merger with IMG College. The company is headquartered in Plano, TX with satellite sales offices located on or near college campuses across the country. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. LIBBEY GLASS: SEC Objects to Disclosure Statement & Joint Plan -------------------------------------------------------------- The U.S. Securities and Exchange Commission, a statutory party to these proceedings and the federal agency responsible for enforcement of the federal securities laws, objects to approval of the Disclosure Statement and confirmation of the Chapter 11 Plan of Libbey Glass Inc. and its affiliated debtors. The Commission claims that the Releases are not consensual because the Plan deems consent to the Releases to be established based on silence or a failure to opt out. In the SEC's view, all shareholders should be required to affirmatively opt in to the Releases in order to be bound by them. The Commission asserts that the Releases of non-debtors have special significance for public investors because such provisions may enable non-debtors to benefit from a debtor’s bankruptcy by obtaining their own releases with respect to past misconduct, including misconduct that led to the bankruptcy. The Commission points out that the exculpation clause in the Plan constitutes an impermissible non-debtor release and discharge since it limits the liability of various nonestate fiduciaries for conduct that occurred prior to the Chapter 11 case, and hence falls squarely within the scope of Section 524(e). A full-text copy of the Commission's objection to disclosure and plan dated July 21, 2020, is available at https://tinyurl.com/y2zgfaro from PacerMonitor at no charge. 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. The 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 LITTLE DISCOVERIES: Sept. 10 Disclosure Statement Hearing Set ------------------------------------------------------------- On July 20, 2020, Philip Stock, counsel to debtor Little Discoveries Day Care Inc, aka Little Discoveries Day Care, Inc., a/k/a Little Discoveries Day Care, aka Little Discoveries Daycare, filed with the U.S. Bankruptcy Court for the Middle District of Pennsylvania a disclosure statement and plan. On July 21, 2020, Judge Robert N. Opel, II ordered that: * Sept. 10, 2020 at 9:30 a.m. at Max Rosenn US Courthouse, Courtroom 2, 197 South Main Street, Wilkes−Barre, PA 18701 is the hearing to consider approval of the disclosure statement. * Aug. 25, 2020 is fixed as the last day for filing and serving in accordance with Federal Rules of Bankruptcy Procedure 3017(a) written objections to the disclosure statement. * The Disclosure Statement and the Plan shall be distributed in accordance with Federal Rule of Bankruptcy Procedure 3017(a). A copy of the order dated July 21, 2020, is available at https://tinyurl.com/y65awwsv from PacerMonitor at no charge. About Little Discoveries Day Care Little Discoveries Day Care, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Pa. Case No. 20-00051) on Jan. 8, 2020. At the time of the filing, the Debtor disclosed assets of between $500,001 and $1 million and liabilities of the same range. Judge Robert N. Opel II oversees the case. The Debtor is represented by Philip W. Stock, Esq. LVI INTERMEDIATE: Antitrust Concerns Raised by Creditors -------------------------------------------------------- Alex Wolf, writing for Bloomberg News, reports that LVI Intermediate Holdings Inc.'s decision to cancel a bankruptcy auction and sell to a rival for $35 million kills competitive bidding and "presents potentially troubling antitrust concerns," the LASIK eye surgery provider's creditors said. LVI, which operates as Vision Group Holdings, should not be authorized to move forward with the planned sale to the operator of LasikPlus, a committee of unsecured creditors said in a filing Tuesday with the U.S. Bankruptcy Court for the District of Delaware. The committee urged the court to force LVI, based in West Palm Beach, Fla., to resume a Chapter 11 auction. About LVI Intermediate Headquartered in West Palm Beach, Fla., LVI Intermediate Holdings (doing business as Vision Group Holdings) develops and manages through its various subsidiaries two of the leading LASIK surgery brands in the United States: The LASIK Vision Institute and TLC Laser Eye Centers. It also owns and manages certain select general ophthalmology practices and QuaslightLasik, a licensed Preferred Provider Organization for LASIK surgery providers. LVI Intermediate Holdings, Inc. and its affiliates filed Chapter 11 petitions (Bankr. D. Del. Lead Case No. 20-11413) on May 29, 2020. In the petition signed by Lisa Melamed, interim chief executive officer, the Debtors were estimated to have $1 million to $10 million in assets and $100 million to $500 million in liabilities. The Hon. Karen B. Owens oversees the cases. The Debtors tapped Cole Schotz P.C. as counsel; Alvarez & Marsal Capital as financial advisor; Raymond James & Associates, Inc., as investment banker; and Donlin Recano & Company, Inc., as claims and noticing agent. MACHINE TECH: $129K Sale of Adel Property to Trust Custodian Okayed ------------------------------------------------------------------- Judge John T. Laney, III of the U.S. Bankruptcy Court for the Middle District of Georgia authorized Machine Tech, Inc.'s private sale of the real property described as 202 Talley Street, Adel, Georgia to New Vision Trust Custodian FBO Ernie M. Eden Roth, IRA, for $129,000. The sale is free and clear of all liens, claims, and encumbrances. The Debtor is authorized and directed to pay Respondent The Trust Bank and Respondent Georgia Department of Revenue from the net sale proceeds. A copy of the Agreement is available at https://tinyurl.com/y4rywpl2 from PacerMonitor.com free of charge. About Machine Tech Machine Tech, Inc., based in Adel, GA, filed a Chapter 11 petition (Bankr. M.D. Ga. Case No. 19-71340) on Nov. 1, 2019. In the petition signed by Joseph A. Bell, president, the Debtor was estimated to have $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Wesley J. Boyer, Esq., at Boyer Terry LLC serves as bankruptcy counsel. MARIZYME INC: Board Appoints Bruce Harmon as New CFO ---------------------------------------------------- The board of directors of Marizyme, Inc. appointed Bruce Harmon as the Company's chief financial officer, effective Sept. 1, 2020. The Company expects that Mr. Harmon's experience with publicly registered companies and life sciences will be an asset to Marizyme going forward. Mr. Harmon has more than 40 years' experience as a financial professional working with Fortune 500 companies to startups, both public and private, and including biotech and pharmaceutical companies. In his career, he has served as chief financial officer, chief executive officer, director, chairman and audit chairman of various public companies on the OTC and as corporate controller of a NASDAQ company in the 1990s. Mr. Harmon served as interim chief financial officer for a pharmaceutical company from 2002 through 2003. Currently, Mr. Harmon owns a consulting firm, Lakeport Business Services, Inc., founded in 2009, which has provided CFO services to more than 100 companies. Through his firm, he currently serves as the chief financial officer of Dale Biotech, LLC (since 2019), a biotech company, and chief financial officer for A Legacy Genetics, Inc. (since 2020), a cattle company. In the past five years, Mr. Harmon has served as chief financial officer of Rhamnolipid, Inc. (2010-2020), a biotech company. In 2005, at the invitation of the Environmental Programme, Mr. Harmon and two others presented a sustainable green housing option to 84 delegates at the United Nations. Mr. Harmon has been the key financial person involved in 15 companies going public from an IPO (NASDAQ) to reverse mergers. Mr. Harmon holds a B.S. degree in Accounting from Missouri State University. The Company has entered into a consulting agreement with Mr. Harmon pursuant to which he will serve as its CFO. The Company will pay Mr. Harmon a cash fee of $5,000 per month and the Company will issue to him 40,000 shares of its common stock vesting monthly over 12 months. The Company has hired Mr. Harmon for a period of one year, which term is renewable upon its mutual agreement. Effective Sept. 1, 2020, Nicholas DeVito, will no longer serve as Marizyme's interim chief financial officer or interim chief executive officer, as the Company has determined that it needs to hire executive officers with life science experience to continue its growth. James Sapirstein, the executive chairman of Marizyme's board of directors and a pharmaceutical industry professional, will be assuming the responsibilities of Marizyme's interim CEO until the Company hires a full time life sciences experienced CEO. Mr. DeVito will assist with the transition process and will remain available as an advisor to the Company as Marizyme's needs dictate. About Marizyme Headquartered in Fort Collins, Colorado, Marizyme, Inc. -- http://www.marizyme.com/-- is a development-stage company dedicated to the commercialization of therapies that address the urgent need relating to higher mortality and costs in the acute care space. Specifically, Marizyme will focus its efforts on developing treatments for disease caused by thrombus (stroke, acute myocardial infarctions, or AMIs, and deep vein thrombosis, or DVTs), infections and pain/neurological conditions. Marizyme reported a net loss and comprehensive loss of $1.06 million for the year ended Dec. 31, 2019, compared to a net loss and comprehensive loss of $248,743 for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $28.63 million in total assets, $441,639 in total liabilities, and $28.19 million in total stockholders' equity. K. R. Margetson Ltd., in Vancouver, Canada, the Company's auditor since 2007, issued a "going concern" qualification in its report dated April 14, 2020 citing that the Company has incurred operating losses since inception, which raises substantial doubt about its ability to continue as a going concern. MARIZYME INC: Incurs $435K Net Loss in Second Quarter ----------------------------------------------------- Marizyme, Inc. filed with the Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss and comprehensive loss of $434,911 for the three months ended June 30, 2020, compared to a net loss and comprehensive loss of $237,362 for the three months ended June 30, 2019. For the six months ended June 30, 2020, the Company reported a net loss of $906,281 compared to a net loss and comprehensive loss of $305,602 for the same period a year ago. As of June 30, 2020, the Company had $28.63 million in total assets, $441,639 in total liabilities, and $28.19 million in ttoal stockholders' equity. Marizyme said, "These financial statements have been prepared in accordance with generally accepted principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next twelve months. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classifications of assets and liabilities should the Company be unable to continue as a going concern. At June 30, 2020, the Company had not yet achieved profitable operations and had accumulated losses of $31,886,862 since its inception, all of which casts substantial doubt about the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management is in the process of executing a strategy based upon a new strategic direction in the life sciences space. The Company has several technologies in the commercialization phase and in development. The Company is seeking acquisitions of biotechnology assets in support of this direction. There can be no assurances that management will be successful in executing this strategy." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/Archives/edgar/data/1413754/000107878220000634/f10q063020_10q.htm About Marizyme Headquartered in Fort Collins, Colorado, Marizyme, Inc. -- http://www.marizyme.com/-- is a development-stage company dedicated to the commercialization of therapies that address the urgent need relating to higher mortality and costs in the acute care space. Specifically, Marizyme will focus its efforts on developing treatments for disease caused by thrombus infections and pain/neurological conditions. Marizyme reported a net loss and comprehensive loss of $1.06 million for the year ended Dec. 31, 2019, compared to a net loss and comprehensive loss of $248,743 for the year ended Dec. 31, 2018. K. R. Margetson Ltd., in Vancouver, Canada, the Company's auditor since 2007, issued a "going concern" qualification in its report dated April 14, 2020 citing that the Company has incurred operating losses since inception, which raises substantial doubt about its ability to continue as a going concern. METRONET HOLDINGS: S&P Affirms 'B' First-Lien Term Loan Rating -------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issue-level rating, with a '2' recovery rating, on Evansville, Ind.-based fiber broadband operator MetroNet Holdings LLC's first-lien debt following the company's proposed $100 million incremental add-on to its $240 million term loan B due in 2026. The '2' recovery rating indicates S&P's expectation of substantial (70%-90%; rounded estimate: 80%) recovery in the event of a payment default. S&P expects the company to use the $100 million in proceeds from the upsized term loan B to fully repay the $55 million balance on its $103 million revolving credit facility, return cash to the balance sheet, and fund future capital expenditures. Despite the incremental first-lien debt, recovery prospects for first-lien lenders are relatively unaffected due to an increase in S&P's default valuation. S&P is raising its default valuation to $390 million from $275 million, primarily reflecting the acquisition of Jaguar Communications in July 2020, incremental EBITDA associated with the transfer of assets to Mature Group HoldCo (MatureCo) from Development Group Holdco (DevCo) over the past four quarters, and a modest increase in the net book value of fiber assets at DevCo. S&P expects the company to continue to transfer newer markets to MatureCo, once they have reached a certain level of maturity and profitability, ideally with 30% broadband penetration. While this transfer likely will result in a higher default valuation over the next 12 months, S&P only factors in current online operations at MatureCo and the value of the fiber assets at DevCo in the rating agency's default valuation. As a result, the rating agency expects to review its default valuation on MetroNet on at least an annual basis. "Our 'B-' issuer credit rating and stable outlook on the company are unaffected. We expect the company to reduce leverage through earnings growth over the next six to 12 months. However, we believe that the company will likely releverage next year to help fund continued expansion as it develops new markets, which will constrain longer-term leverage improvement such that adjusted debt to EBITDA remains above 6.5x," S&P said. RECOVERY ANALYSIS Key analytical factors -- S&P's simulated default scenario contemplates a deterioration in MetroNet's competitive position precipitated by intense competitive pressures from significantly larger and better-capitalized cable operators such as Comcast Corp. and Charter Communications Inc. These factors could contribute to significantly lower revenue, profitability, and cash flow levels for the company. This decline in operating results would lead to a payment default at the point where the company's liquidity and cash flow would be insufficient to cover cash interest expenses, mandatory debt amortization, and maintenance level capital expenditure requirements. -- At default, S&P's recovery analysis assumes an 85% draw on the revolver, a step up in credit spreads to accommodate covenant amendments, and estimated debt claims that include about six months of accrued but unpaid interest outstanding at the point of default. -- S&P assesses recovery prospects on the basis of a distressed gross recovery value of approximately $390 million. The overall valuation reflects the combination of $279 million from MetroNet's mature assets (based on an emergence EBITDA of about $56 million and an EBITDA multiple of 5x) and $111 million from MetroNet's development assets (using a discrete asset valuation [DAV] of its pledged fiber assets at a realization rate of 85%). The $56 million emergence EBITDA is S&P's estimate of MetroNet's hypothetical default-level EBITDA for its mature markets. Given MetroNet's small scale and overbuilder status, S&P uses an EBITDA multiple of 5x in S&P's default valuation, lower than the 6x-7x that would typically be used for an incumbent cable operator. Simulated default and valuation assumptions -- Simulated year of default: 2022 -- EBITDA at emergence: $56 million -- Implied enterprise valuation multiple: 5x -- DAV: $111 million -- Gross enterprise value (EV): $390 million Simplified waterfall -- Net EV (after 5% administrative costs): $370 million -- Valuation split (obligors/nonobligors): 100/0% -- Estimated net EV available to first-lien debt: $370 million -- Estimated first-lien debt claims: $437 million -- First-lien debt recovery rating: '2' (rounded estimate: 80%) -- Estimated value available for second-lien debt: $0 million -- Estimated second-lien debt claims: $90 million -- Second-lien debt recovery rating: '6' (rounded estimate: 0%) Note: All debt amounts include six months of prepetition interest. MIDLAND COGENERATION: S&P Cuts Senior Secured Notes Rating to 'BB' ------------------------------------------------------------------ S&P Global Ratings lowered its issue-level rating on Midland Cogeneration Venture L.P.'s (MCV) $560 million ($294.5 million outstanding) senior secured notes and $181.25 million ($100.2 million outstanding) series B senior secured notes due 2025 to 'BB' from 'BB+'. S&P maintains its '1' recovery rating on the project's debt, which indicates its expectation of very high (90%-100%; rounded estimate: 95%) recovery in the event of a payment default. MCV is a 1,633 megawatt (MW) natural gas-fired, combined-cycle power plant with 1.5 million pounds per hour of steam capacity located in Midland, Mich. The plant entered commercial operation in 1990. It is the largest natural-gas fired cogeneration plant in the U.S. and was originally designed to be a nuclear power plant. The downgrade reflects the expectation of lower DSCRs following a settlement in April 2020 with the project's offtaker, Consumers, which lowers the FER. S&P had previously forecasted a FER of $9.05/MWh starting in 2020 and rising to $9.65 in 2024. Instead, the 2020 nominal FER is $6.20, and nominally $6.12 thereafter. While the settlement extends the PPA and gas transportation and gas storage contracts to May 2030, the PPA extension does not benefit debt holders except for higher recovery prospects if the project were to default. The settlement is subject to MPSC unconditional approval of all contracts and all pending litigation with Consumers will be dismissed upon MPSC approval. MCV management believes the language will be approved in the first quarter of 2021, because MCV is an important asset in terms of reliability and to support variable energy on the grid, as Consumers is planning to increase the amount of renewable energy, especially solar energy. The lower FER decreases MCV's forecasted fixed energy revenue and thus reduces its cash flow available for debt service (CFADS). When comparing S&P's forecast this year from last year, in which it assumed an FER of $9.05 versus the FER under the settlement, fixed energy revenues decline by $159 million from 2020 through 2024. Gross margins decline by $121 million over the same period, because the lower FER is partially offset by a $31 million improvement in variable energy gross margins, mainly due to lower fuel expenses based on lower gas price assumptions. CFADS over the same period decline by $65 million, because the decline in gross margins is partially offset by a reduction in staffing levels and capital expenditures (capex) that should result in $20 million and $50 million of cost savings, respectively. Management is proceeding with a planned restructuring. Headcount has decreased from 113 employees in January 2020 to 90 as of July 31, with 78 employees expected to remain by year-end 2020, and an eventual goal of 69 employees in 2023. Management has deferred some of the capex programs until after the debt term and has chosen lower-cost alternatives for rotor replacement. However, excluding the $10.5 million savings from no longer needing to increase the size of the Great Lakes interconnection, the revised capex budget represents a savings of 45%. "Given the age of the asset, there is a risk that lower capex could hurt operational performance. Nevertheless, at this time, we think that management can effectively handle this reduction and delay or cancel non-essential capex until after the debt matures," S&P said. The lower FER reduces minimum coverage to 1.16x in 2024, which is consistent with base case performance at the 'b+' level. Management's DSCR forecast for 2024 is 1.38x, which is higher than S&P's forecast because the rating agency does not include payments from the general reserve in its calculation of CFADS and the rating agency excludes merchant capacity and energy sales above 1,240 MW. While S&P's revised downside case also experiences lower coverage levels than before, the project has sufficient liquidity to survive a 'bbb' downside, resulting in a two-notch uplift, or a final rating of 'BB'. While the revised FER is lower than S&P's forecast, the fixed price does bring stability to cash flows, which could decline even further without a settlement. In the FER equation, the cost to operate coal generation represents the numerator and the amount of coal generation is in the denominator. The inputs are based on the Campbell 1&2, Campbell 3, and Karn 1&2 coal-fired power plants. If any plant is online less than 5,500 hours or retired, that plant is excluded from the calculation. MPSC has approved Consumer's request to close Karn 1&2 in 2023. In the meantime, low gas prices could make coal not economically viable to dispatch, leading to dispatch below the minimum and thus exclusion from the calculation. The closure of Karn could also likely lead to lower maintenance expenses at Karn, putting negative pressure on FER. Chemical costs have also gone down significantly. In addition, since Consumers has changed how it accounts for costs--the impact of which is a key point of contention and a matter under arbitration--its accounting changes could permanently reduce FER. The settlement agreement also removes the gas transportation and gas storage risk. The contracts are extended to May 2030 (coterminous with the PPA), with the current contract expiring in February 2023. As noted above, the additional capex to support an alternative gas transportation contract is also no longer needed. "Our outlook on MCV is negative. If the settlement with Consumers is not approved by MSPC, the FER could decline further. In addition, rising gas prices due to a decline in production could decrease dispatch, resulting in lower coverage. Increased capex and operating costs due to the age of the plant could also diminish coverages. While we expect base case DSCRs to be above 1.2x for the next two years, our minimum of 1.16x occurs in 2024," S&P said. S&P could lower its rating on MCV's debt by one or more notches if MSPC rejects the settlement agreement and the rating agency's FER assumption falls below $6. The rating agency could also lower the rating if the project's gross margins are lower than it anticipates. This would most likely occur if Henry Hub gas prices rise to $3.5-$4.0/MMbtu. Coverage could also decline if capex increases, O&M expenses rise higher than S&P expects, or if the project experiences operational problems, unless MCV mitigates these factors with liquidity. Specifically, S&P could lower the rating if it anticipates a minimum DSCR at the middle of the 1.0x-1.2x range on a sustained basis. As such, there is downward ratings pressure given limited headroom for any negative revision to S&P's forecast. S&P could return its outlook to stable if MSPC accepts the settlement and gas prices in its forecast remain below $3/MMbtu. It could raise the rating on MCV's debt if the financial performance under its base case results in a minimum DSCR in the middle of the 1.2x-1.4x range. This would most likely occur if gross margins increase, including giving credit to merchant sales above 1,240 MWs, due to higher dispatch levels. MONAKER GROUP: May Issue 1.5M Shares Under 2017 Equity Plan ----------------------------------------------------------- Monaker Group, Inc. filed a Form S-8 registration statement with the Securities and Exchange Commission to register 1,500,000 shares of common stock issuable under the Company's Amended and Restated 2017 Equity Incentive Plan. On June 26, 2019, the Board of Directors of the Company approved an amendment to the 2017 Plan to (a) increase by 1,500,000, the number of shares reserved for issuance under such plan; and (b) clarify the effect that shares of Common Stock surrendered or withheld to pay the exercise price of a stock option or to satisfy tax withholding or other requirements will have on the number of shares available for future grants under the 2017 Plan. The Plan Amendments were approved and ratified by the stockholders of the Company on Aug. 15, 2019. The Company filed this Registration Statement to register under the Securities Act of 1933, as amended, (a) an additional 1,381,337 shares of Common Stock reserved for future issuance under the 2017 Plan, the offer and sale of which are being registered herein; and (b) 201,221 restricted shares of Common Stock previously issued under the 2017 Plan, the resale of which are being registered herein (including 190,000 shares of Common Stock, the offer and sale of which were included in the Prior Registration Statement and 11,221 shares of Common Stock not included in the Prior Registration Statement). A full-text copy of the prospectus is available for free at: https://www.sec.gov/Archives/edgar/data/1372183/000158069520000320/mkgi-s8_082820.htm About Monaker Group Headquartered in Weston, Florida, Monaker Group, Inc. -- http://www.monakergroup.com/-- is a technology-driven company focused on delivering innovation to the alternative lodging rental (ALR) market. The proprietary Monaker Booking (MBE) provides access to more than 3.2 million instantly bookable vacation rental homes, villas, chalets, apartments, condos, resort residences, and castles. MBE offers travel distributors and agencies an industry first: a customizable, instant-booking platform for alternative lodging rental. Monaker Group reported a net loss of $9.45 million for the year ended Feb. 29, 2020. As of May 31, 2020, the Company had $9.13 million in total assets, $4.89 million in total liabilities, and $4.24 million in total stockholders' equity. Thayer O'Neal Company, LLC, in Sugar Land, Texas, the Company's auditor since 2019, issued a "going concern" qualification in its report dated May 29, 2020, citing that the Company has an accumulated deficit and limited financial resources. This raises substantial doubt about its ability to continue as a going concern. NATIONAL CAMPUS: S&P Affirms 2015A, 2015B Bond Rating at 'CCC' -------------------------------------------------------------- S&P Global Ratings affirmed its 'CCC' long-term rating on New Hope Cultural Education Finance Corp., Texas' series 2015A and series 2015B taxable student housing revenue bonds, issued for National Campus & Community Development Corp.'s College Station Properties LLC (NCCD - College Station). The outlook is negative. "In accordance with our criteria, the 'CCC' rating and negative outlook reflect our view that NCCD - College Station is likely to default without unforeseen positive developments in occupancy and revenue," said S&P Global Ratings credit analyst Ying Huang. "They also reflect our opinion of at least a one-in-two likelihood of default given that the project ran into cash flow shortfalls in fiscals 2018 through 2020." The recent cash flow shortfalls are a result of the project's much lower-than-anticipated occupancy of 54% in fall 2017 and a similar occupancy in spring 2018, leading to a breach of the minimum 1x debt service coverage covenant in fiscal 2018. While occupancy has improved to 91%-94%, the project was not able to achieve break-even performance to fully cover its debt service payment without drawing from the debt service reserve fund (DSRF) in fiscals 2018 and 2019. On July 7, 2020, the bond trustee disclosed that NCCD - College Station had exceeded the aggregate DSRF draw limit ($14.8 million) specified in the second forbearance agreement, following the July 1, 2020, debt service payment of $4.5 million, which constitutes a forbearance default. In addition, the bond trustee anticipates that when NCCD - College Station prepares and provides to the bond trustee the financial statements for fiscal 2020, the financial statements will reflect a fixed-charge coverage ratio of less than 0.84x (based on the calculation definition in the forbearance agreement). If this occurs, it will constitute an additional forbearance default. NCCD - College Station is currently in negotiation with the bondholders regarding the forbearance default, and the final timeline and resolution are not yet available at the time of S&P's review. In addition, the proposed budget of NCCD - College Station for fiscal 2021 contemplates that an additional DSRF draw of $4.0 million-$4.5 million will be needed in order to make the debt service payments. The DSRF balance stood at $8.5 million as of July 2020. S&P believes NCCD - College Station will likely continue to experience cash flow shortfalls, which will require repeated draws from its DSRF to cover debt service payments over the next couple of years. Given the aggregate $15.8 million DSRF draw exceeding the $14.8 million limit in the second forbearance agreement and an additional $4.0 million-$4.5 million draw budgeted for fiscal 2021, S&P believes there is limited flexibility for NCCD - College Station to eventually avoid bond payment default, although the default could happen beyond the next 12 months. Currently, a lower rating is precluded because default is not a virtual certainty in the next six months, as NCCD - College Station is currently in negotiation with the bondholders regarding the covenant breach in fiscal 2020, and management believes it is still not in the best interest of the bondholders to accelerate the bonds. Technically, NCCD - College Station can still draw on its DSRF for debt service payments to avoid default in fiscal 2021 as long as the bondholders choose not to terminate the second forbearance agreement. The negative outlook reflects S&P's view that within the one-year outlook time frame, the rating may be lowered if bond trustee terminates the second forbearance agreement or expected cash flow shortfalls continue, adding uncertainty as to whether NCCD - College Station will be able to meet debt service payments coming due. In S&P's view, NCCD - College Station will have to secure a waiver for the forbearance default with the bondholders and increase occupancy and rent substantially in order to earn sufficient revenue to cover debt service and operating expenses. NEOVASC INC: Partially Prepays Convertible Debenture ---------------------------------------------------- Neovasc Inc. reports that Strul Medical Group LLC exercised 501,000 of the remaining 1,149,910 common share purchase warrants issued pursuant to a Securities Purchase Agreement dated May 26, 2020 at an exercise price of US$2.634 per May Warrant for aggregate exercise proceeds to the Company of US$1,319,634. Using the Exercise Proceeds, the Company has prepaid a portion of the convertible debenture in the aggregate principal amount of US$11,500,000 issued to SMG pursuant to a private placement on May 13, 2019. The total aggregate amount of the Exercise Proceeds has been applied to the prepayment of the Note whereby US$1,263,884.57 has been applied to the remaining US$7,886,658.88 principal of the Note, US$25,277.69 has been paid as a prepayment penalty pursuant to the terms of the Note and US$30,471.74 has been paid in accrued interest. In connection with the prepayment of the Note, the Company also issued to SMG 168,518 common share purchase warrants at an exercise price of US$7.50 per Repayment Warrant in accordance with the terms of the Note. As of Aug. 14, 2020, after the impact of the recently announced financing, the Company had 22,647,127 shares issued and outstanding and the fully diluted share count was 37,331,314 (assuming all notes and warrants are fully converted and exercised and without giving effect to the PIK interest). About Neovasc Inc. Neovasc -- http://www.neovasc.com/-- is a specialty medical device company that develops, manufactures and markets products for the rapidly growing cardiovascular marketplace. Its products include the Reducer, for the treatment of refractory angina, which is not currently commercially available in the United States (2 U.S. patients have been treated under Compassionate Use) and has been commercially available in Europe since 2015, and Tiara, for the transcatheter treatment of mitral valve disease, which is currently under clinical investigation in the United States, Canada, Israel and Europe. Neovasc recorded a net loss of $35.13 million for the year ended Dec. 31, 2019, compared to a net loss of $107.98 million for the year ended Dec. 31, 2018. As at Dec. 31, 2019, the Company had $10.10 million in total assets, $24.55 million in total liabilities, and a total deficit of $14.44 million. Grant Thornton LLP, in Vancouver, Canada, the Company's auditor since 2002, issued a "going concern" qualification in its report dated March 30, 2020 citing that the Company incurred a comprehensive loss of $33,618,494 during the year ended Dec. 31, 2019, and as of that date, the Company's liabilities exceeded its assets by $14,445,765. These conditions, along with other matters, raise substantial doubt about the Company's ability to continue as a going concern. NEW HOPE CULTURAL: S&P Cuts 2019A Bond Rating to 'BB+(sf)' ---------------------------------------------------------- S&P Global Ratings lowered its long-term ratings on New Hope Cultural Education Facilities Finance Corp., Texas' series 2019A, 2019B, and 2019C senior-living revenue bonds (Quality Senior Housing Foundation of East Texas Inc. Project) to 'BB+(sf)', 'BB(sf)', and 'BB-(sf)' from 'BBB(sf)', 'BB+(sf)', and 'BB(sf)', respectively. The outlook for all ratings is stable. The series 2019 bonds were issued in August 2019 by the New Hope Cultural Education Facilities Finance Corp. on behalf of the borrower, Quality Senior Housing Foundation (QSHF) of East Texas Inc., a Texas nonprofit corporation. The 2019 issuance consists of three tranches of debt, with the senior tranche bifurcated between tax-exempt and taxable portions as series 2019A-1 and 2019A-2, respectively. Proceeds of the bonds, with a total par amount of $73.32 million, were used by the borrower to acquire three stand-alone senior-living facilities in northeast Texas consisting of 380 rental independent-living, assisted-living, and memory-care units. Proceeds of the bonds were also used to fund an operations and maintenance reserve fund and property tax account, fund debt service reserve funds for the series B and C bonds, and pay issuance costs. As of midyear 2020, the entire $73.32 million remains outstanding. The ratings were placed under criteria observation (UCO) on April 15, 2020 in conjunction with the publication of S&P's "Methodology for Rating U.S. Public Finance Rental Housing Bonds" (RHB) criteria. Due to the timing of the acquisition issuance and the review requirements of ratings UCO, S&P has completed this review with available information, which includes a partial-year 2019 audit and unaudited year-to-date 2020 financial statements, as well as current market, economic, and management and governance information. S&P will review the ratings again when full-year audited financial statements are available for fiscal 2020. The primary reason for the review of these ratings at this time is to apply the new criteria and remove the ratings from UCO. "The downgrade on the series 2019A, 2019B, and 2019C bonds reflects the implementation of our RHB criteria," said S&P Global Ratings credit analyst Daniel Pulter. The ratings are no longer under criteria observation. NPHSS LLC: $6.5M Sale of Carmel Property to Legatum Approved ------------------------------------------------------------ Judge Stephen L. Johnson the U.S. Bankruptcy Court for the Northern District of California authorized NPHSS, LLC's sale of the real property located at 5 Sand & Sea, Carmel, California to Legatum Holdings, LP or assignee for $6,532,500, pursuant to their Purchase Agreement, dated July 9, 2020. A telephonic hearing was held on Aug. 19, 2020 at 2:00 p.m. The Debtor is authorized to pay the following undisputed liens or claims at closing of the sale: (1) deed of trust in favor of CalCap Income Fund 1, identified as Document No. 2018058240 of the Monterey County Official Records; (2) real property taxes owed to the County of Monterey, and (3) normal and customary escrow and title charges. The sale is free and clear of the interests of Michael Luu and Jeffrey Ma. These interests are described as writs of attachment against the Property, recorded on Feb. 18, 2020, in the Official Records of Monterey County, and identified as Document Numbers 2020008109, 2020008110, 202k0008111, and 2020008112. The interests of Luu and Ma will attach to the proceeds of the sale. The Buyer has not assumed any liabilities of the Debtor. Franklin Loffer, on behalf of the Debtor, is authorized to execute any documents and undertake any actions that are necessary or appropriate to effectuate or consummate the sale. The Debtor, and any escrow agent upon the Debtor's written instruction, will be authorized to make such disbursements on or after the closing of the sale as are required by the purchase agreement or order of the Court, including, but not limited to (1) the note and deed of trust in favor of CalCap Income Fund 1, identified as Document No. 2018058240 of the Monterey County official Records; (2) all real property taxes owed to the County of Monterey;(3) and normal and customary escrow and title charges; and (4) the residual proceeds of sale paid to the client trust account of Stanley A. Zlotoff. No disbursement from the Trust Account will be permitted absent prior Court order. Except as otherwise provided in the Motion, the Property will be sold, transferred, and delivered to the Buyer on an "as is, where is" or "with all faults" basis. The Order is effective upon entry, and the stay otherwise imposed by Rule 62(a) of the Federal Rules of Civil Procedure and/or Bankruptcy Rule 6004(h) will not apply. About NPHSS LLC NPHSS, LLC, is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)) based in Carmel by the Sea, Calif. NPHSS filed a Chapter 11 petition (Bankr. N.D. Cal. Case No. 20-50296) on Feb. 19, 2020. The petition was signed by Franklin Davis Loffer, III, Debtor's managing member. At the time of the filing, the Debtor was estimated to have assets of between $1 million and $10 million and liabilities of the same range. Judge Stephen L. Johnson oversees the case. Stanley Zlotoff, Esq., is the Debtor's bankruptcy counsel. OGGUSA INC: CFSB Consents to Sale of Paducah Property for $975K --------------------------------------------------------------- Judge Gregory R. Schaaf of the U.S. Bankruptcy Court for the Eastern District of Kentucky entered the Stipulated and Agreed Order between Oggusa, Inc. and affiliates, and Community Financial Services Bank ("CFSB"), with respect to the Debtors' sale of the real property commonly known as 322 N. 3rd Street, Paducah, Kentucky for not less than $975,000. On May 19, 2020, the Court entered the Sale Order authorizing and approving the sale of assets to GenCanna Acquisition Corp. The closing of the Sale Transaction under the terms of the Sale Order and the Asset Purchase Agreement, dated May 29, 2020, as the same may be amended, by and between the Purchaser and the Debtors, occurred on May 29, 2020. Certain assets were excluded from the Sale Transaction under the terms of the Sale Order and APA, such as the Paducah Property, and, accordingly, remain property of the Debtors' estates. On June 18, 2020, CFSB filed a proof of claim, identified as Claim No. 200, against Debtors OGG, Inc. and Oggusa, by which CFSB asserted a claim in an amount not less than $915,914, secured by the mortgage on the Paducah Property ("Claim No. 200"). Thereafter, CFSB, at the Debtors' request, provided the Debtors with a payoff Letter for the Note Obligations, asserting that as of July 6, 2020, CFSB was owed $997,808 for principal, interest, late fees, attorneys' fees and costs and a mortgage release fee. CFSB maintains that the current interest rate for the Promissory Note is 6.50% per annum. Following the closing of the Sale Transaction, CFSB and the Debtors have entered into good-faith, arm's-length negotiations concerning the sale, lease or other disposition of the Paducah Property and related matters and have reached certain agreements in principle that the Parties have memorialized in the Stipulation and Agreed Order. Subject to finalizing the Stipulation and Agreed Order, and Court approval thereof, GCG Opco, after consultation with CFSB, has entered into their Commercial Exclusive Right to Sell/Lease Contract with The Gibson Co., as the listing broker for the sale of the Paducah Property. The Court ordered that the parties will cooperate and use commercially reasonable efforts to pursue the sale of the Paducah Property in accordance with the terms of the Stipulation and Agreed Order and such additional terms as are mutually agreeable to the Parties. CFSB consents to GCG Opco's retention of the Broker on the terms set forth in the Listing Agreement. Upon the Court's approval of the Stipulation and Agreed Order, GCG Opco's employment of the Broker upon the terms set forth in the Listing Agreement will be authorized and approved effective as of Aug. 1, 2020, the date the Paducah Property was first listed by the Broker under the Listing Agreement. Upon the consummation of a Property Sale, without further notice, hearing or approval of the Court, the Debtors will be authorized to pay, and the Broker will be entitled to receive, the commission in accordance with the terms of the Listing Agreement. CFSB's prior written consent (which consent may take the form of an email of CFSB or its counsel) will be required for any proposed Property Sale for gross sale proceeds of less than $975,000. CFSB is deemed to consent to any proposed Property Sale for gross sale proceeds of $975,000 or more, so long as the buyer has demonstrated its financial ability to close the transaction to the reasonable satisfaction of CFSB and the Debtors. In connection with any Property Sale, the proceeds of the Property Sale will be distributed as follows: a. First, the following obligations will be reserved for, reimbursed or paid, as applicable, from the gross sale proceeds of a Property Sale: (i) the Broker's commission in accordance with the terms of the Listing Agreement; (ii) any buyer's broker fees that the Debtors, after consultation with CFSB, agree with the purchaser to pay from the gross sale proceeds in connection with a Property Sale; (iii) such costs that the Debtors, after consultation with CFSB, agree with the purchaser to incur or pay for remediation or repairs at the Paducah Property in connection with a Property Sale; and (iv) any property or other transfer taxes for which GCG Opco, as seller of the Paducah Property, is responsible or that the Debtors, after consultation with CFSB, agree with the purchaser should be borne by GCG Opco, as the seller, in connection with the Property Sale. b. Second, 100% of the initial $625,000 of Net Sale Proceeds will be remitted exclusively to CFSB for application against the Note Obligations. c. Third, Net Sale Proceeds in excess of $625,000 and equal to or less than $900,000 will be allocated as follows: (i) 85% of such Net Sale Proceeds will be remitted to CFSB for application against the Note Obligations; and (ii) 15% of such Net Sale Proceeds will be remitted to the Debtors. d. Fourth, Net Sale Proceeds in excess of $900,000 until the Note Obligations are paid in full will be allocated as follows: (i) 60% of such Net Sale Proceeds will be remitted to CFSB for application against the Note Obligations; and (ii) 40% of such Net Sale Proceeds will be remitted to the Debtors. e. Fifth, after all Note Obligations are paid in full, any remaining Net Sale Proceeds will be allocated exclusively to the Debtors. For the avoidance of doubt, in the event that the sale of the Paducah Property yields proceeds insufficient to satisfy the Note Obligations in full, any deficiency claim remaining will be an unsecured, nonpriority claim against the estate of GCG Opco. TThe automatic stay of section 362 of the Bankruptcy Code is deemed modified solely to the extent necessary to facilitate the remittance to CFSB of the Net Sale Proceeds agreed to be allocated to it and for CFSB's application of such Net Sale Proceeds to the Note Obligations, all in accordance with the terms of this Stipulation and Agreed Order. Promptly upon the payment in full of the Note Obligations, CFSB will file on the docket of the Bankruptcy Cases a notice that Claim No. 200 has been satisfied in full. For the avoidance of doubt, all rights, claims and objections of the respective Parties are reserved in connection with Claim No. 200 and the calculation of the payoff amount for the Note Obligations. Notwithstanding anything to the contrary in the Bankruptcy Code or the Bankruptcy Rules, the Stipulation and Agreed Order will be immediately effective in accordance with its terms upon its entry on the docket of the Bankruptcy Cases of the Court's approval. A copy of the Contract is available at https://tinyurl.com/y28uvulm from PacerMonitor.com free of charge. The bankruptcy case is In re Oggusa, Inc., (Bankr. E.D. Ky. Case No. 20-50133-grs). The Debtor's case is jointly administered with that of its affiliates. ONEWEB GLOBAL: Asks Court to Reject Billion Loans Creditor Probe ---------------------------------------------------------------- Leslie A. Pappas, writing for Bloomberg News, reports that OneWeb Global Ltd. asked a court reject its creditors' quest to investigate $1.6 billion in bridge financing, saying the probe could turn a "home run" bankruptcy into a "nuclear winter." The investigation would lead to a "massive and unwarranted litigation frenzy aimed at delaying these cases and strangling them with excessive professional fees," the bankrupt satellite operator said in a filing with the U.S. Bankruptcy Court for the Southern District of New York. OneWeb's filing came in response to the unsecured creditors committee's July 13 request for derivative standing to investigate $1.6 billion in promissory notes that OneWeb issued. About OneWeb Global Ltd. Founded in 2012, OneWeb Global Limited is a global communications company developing a low-Earth orbit satellite constellation system and associated ground infrastructure, including terrestrial gateways and end-user terminals, capable of delivering communication services for use by consumers, businesses, governmental entities, and institutions, including schools, hospitals, and other end-users whether on the ground, in the air, or at sea. OneWeb's business consists of the development of the OneWeb System, which has included the development of small-next generation satellites that have been mass-produced through a joint venture and the development of specialized connections between the satellite system and the internet and other communications networks through the SNPs. For more information, visit https://www.oneweb.world/ OneWeb Global Limited and its affiliates ought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-22437) on March 27, 2020. At the time of the filing, Debtors disclosed assets of between $1 billion and $10 billion and liabilities of the same range. The Debtors tapped Milbank, LLP as their legal counsel, Guggenheim Securities, LLC as investment banker, FTI Consulting, Inc. as financial advisor, and Omni Agent Solutions as claims, noticing and solicitation agent. The U.S. Trustee for Region 2 appointed a committee of unsecured creditors on April 16, 2020. The committee has tapped Paul Hastings LLP as its bankruptcy counsel, Cole Schotz P.C. as conflicts counsel, Province, Inc. as financial advisor, and Jefferies LLC as investment banker. ONONDAGA COMMUNITY COLLEGE: S&P Cuts 2015A Rev Bond Rating to 'BB+' ------------------------------------------------------------------- S&P Global Ratings lowered its long-term rating to 'BB+' from 'BBB' on Onondaga Civic Development Corp., N.Y.'s series 2015A revenue bonds, issued for Onondaga Community College Housing Development Corp. (OCCHD). The outlook is negative. On March 25, 2020, S&P revised the outlook to negative on OCCHD and several other U.S. higher education privatized (off-balance-sheet) student housing projects in the wake of the COVID-19 pandemic and the uncertainty about the ultimate economic fallout. In addition, on Aug. 5, 2020, S&P placed OCCHD and several U.S. higher education privatized student housing projects on CreditWatch with negative implications, because of the pandemic and the uncertainties surrounding fall occupancy. "The downgrade reflects operating pressure that OCCHD faces due to what we view as the projected loss of fiscal 2021 rental revenue following the reduction of available beds in the housing projects because of the implementation of safety measures related to the COVID-19 pandemic," said S&P Global Ratings credit analyst Brian Marshall. "The negative outlook reflects our belief that all projects in the sector are facing negative economic or fundamental business conditions that could result in downgrades over the next one-to-two years," Mr. Marshall added. In addition, the negative outlook reflects expected challenges facing the industry due to a sudden and potentially prolonged decline in student housing occupancy and the associated loss of rental revenue because many colleges and universities have transitioned to remote learning from in-person learning. The negative outlook also reflects S&P's view that it is highly likely the project will continue to generate weaker rental revenues and there is a high likelihood that that the project will need to draw on available liquidity for fiscal 2021. In its opinion, the project's financial operation is sustainable in the short term given OCCHD's very solid liquidity support. Still, if occupancy levels do not return the pre-pandemic 873-bed maximum following fiscal 2021, S&P could lower the rating further. OCCHD, a discrete component unit of Onondaga Community College, owns and operates student housing facilities on the college's campus. Although S&P has reviewed the college's finances and demand in order to understand the project as well as the college's role in supporting it, this rating does not directly reflect the college's underlying credit characteristics because the bonds are not a direct debt obligation of Onondaga Community College. The rating reflects S&P's opinion of OCCHD's: -- Recent declines in coverage following years of coverage well above 2.0x, with projections expecting coverage of 1.2x in fiscal 2020 and lower than 1.0x in fiscal 2021 following lower maximum occupancy due to recently implemented safety measures; -- Reduction of maximum occupancy by 50% due to recently implemented safety measures, which materially limits potential project revenue generation; -- Material enrollment declines in recent years tied to unfavorable demographic shifts, although management is instituting plans to stabilize enrollment levels; and -- Limited revenue stream, which includes student fees. Partially offsetting the above weaknesses, in S&P's view, are the corporation's: -- Very solid liquidity, with unrestricted cash of $12.5 million (inclusive of a $1.7 million internal DSRF), coupled with management's willingness to use these resources to continue to make timely debt service payments in fiscal 2021; -- Limited number of beds relative to total headcount and no plans to expand; and -- Maintenance of all assets at OCCHD, without the transfer of surplus funds back to the college. OCCHD is responsible for all student housing operations, residence life programs, and administration of student housing operations, including but not limited to staffing, marketing and rental or licensing of the residence halls, enforcement of housing rental or license agreements, maintenance and capital improvements, and supervision of third-party contractors. All housing is on-campus, which, when coupled with limited housing options for students, continues to be a stabilizing credit factor, in S&P's view. Onondaga Community College was established in 1962 as a unit of SUNY and is one of 30 community colleges and 64 campuses in the SUNY system. The college is about four miles from Syracuse and operates an extension site north of the city in Liverpool. The college offers two-year degree programs; on completion, students transfer to baccalaureate degree programs at four-year campuses or enter the workforce The downgrade reflects S&P's opinion of the operating pressure that the project faces due to the likelihood of the projected loss of rental revenue as maximum occupancy levels have been reduced by 50% due to recently implemented safety measures for fall 2020 in response to the COVID-19 pandemic. The college transitioned to remote learning in an effort to protect the health and safety of students, and limit the community spread of the coronavirus. S&P views the risks posed by COVID-19 to public health and safety as a social risk under its environmental, social, and governance factors. Despite the elevated social risk, the rating agency believes the project's environmental and governance risk are in line with its view of the sectors as a whole. S&P could lower the rating if occupancy doesn't rebound following projected declines due to pandemic-related safety measures that lowered maximum occupancy in fiscal 2021 and if available liquidity falls materially from current levels due to continued occupancy pressures beyond fall 2020, such that a draw on available funds is necessary leaving little cushion for additional pressures." While unlikely in the near term, a return to stable outlook would be predicated on evidence of sustained solid occupancy and cash flows sufficient to meet covenants and debt service payments on an ongoing basis. PATRIOT WELL: Eyes Quick Sale Process to Exit Chapter 11 -------------------------------------------------------- Law360 reports that oil well services company Patriot Well Solutions told a Texas bankruptcy court July 22, 2020, that it hopes to have its going concern asset sale over and done within 60 days to ensure a speedy exit from Chapter 11. At a remote hearing, counsel for Patriot told U.S. Bankruptcy Judge David Jones that with a $12 million part-credit stalking horse bid in hand from the company's equity owner and debtor-in-possession lender, it hopes to conclude the sale process by mid-September. About Patriot Well Solutions Patriot Well Solutions LLC provides well completion, production and intervention services for the energy industry. It offers wireline and perforating, coiled tubing and nitrogen, fluid pumping and crane services. Patriot Well Solutions sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-33642) on July 20, 2020. At the time of the filing, Debtors disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Jeffrey P. Norman oversees the cases. The Debtors tapped Squire Patton Boggs (US) LLP as their legal counsel, Sonoran Capital Advisors LLC as restructuring advisor, Piper Sandler & Co. as financial advisor, and Stretto as claims and noticing agent. PCI GAMING: S&P Affirms 'BB+' ICR; Outlook Negative --------------------------------------------------- S&P Global Ratings affirmed its ratings on Alabama-based PCI Gaming Authority's (d/b/a Wind Creek Hospitality), including its 'BB+' issuer credit rating, and removed the ratings from CreditWatch, where the rating agency placed them with negative implications on March 20, 2020. "The rating affirmation reflects our forecast for PCI's adjusted leverage to improve to below our 3x downgrade threshold by the end of fiscal 2021," S&P said. Under its forecast, S&P expects PCI's adjusted net leverage to improve below its 3x downgrade threshold by the end of fiscal 2021 (PCI's fiscal year ends Sept. 30), after spiking to around 4x at the end of fiscal 2020. S&P's forecast for deleveraging incorporates its expectation for PCI's EBITDA to continue to ramp up following the re-opening of its properties in June, after being closed in March due to the pandemic. Like many operators whose properties closed, during the June quarter, PCI's revenue declined significantly and EBITDA was negative. S&P believes, however, that since PCI's properties have opened--the Alabama properties opened in early June and Pennsylvania opened in late June, EBITDA generation has been improving to a level that comfortably funds fixed charges (i.e., interest expenses, priority tribal distributions, and maintenance capital expenditures). Furthermore, and notwithstanding continued capacity restrictions, S&P expects EBITDA generation to continue to grow over the next few quarters because the rating agency expects some capacity restrictions may continue to ease, and customers may feel more comfortable being in enclosed indoor public spaces. S&P believes it may take several quarters for revenue and EBITDA to return to pre-closure levels because it believes some capacity and other social-distancing restrictions may remain in place in the absence of a vaccine or therapies to treat the virus. Furthermore, the rating agency believes demand may be impaired by prolonged high unemployment, especially in the absence of additional government stimulus efforts. S&P's forecast assumes the following: -- U.S. unemployment to remain elevated at 9.3% in 2020 and 7.2% in 2021. -- 2020 revenue to be down around 10% to 15% compared to 2019, which included only five months of operations of the Pennsylvania property. -- 2020 EBITDA to be down between 50% and 60% driven by the revenue decline, negative EBITDA during the property closures, only a modest reduction in operating expenses after reopening, and the fixed nature of the priority distributions to the tribe. -- S&P's measure of EBITDA is calculated by subtracting distributions to the tribe that are permitted even under certain circumstances of an event of default under the authority's credit agreement. The rating agency removes distributions since it believes these distributions are not available for debt service and are needed to support tribal government operating expenses. -- 2021 revenue to be up significantly compared to 2020, and around 15% to 20% higher than 2019 because 2021 will include a full year of Wind Creek Bethlehem as compared to five months in 2019. -- 2021 EBITDA to be up siginficantly compared to 2020, and around 10% to 15% lower compared to 2019. The decrease in EBITDA compared to 2019 is driven in part by additional gaming tax expense from incorporating a full year of operations of Pennsylvania (which has a very high slot gaming tax), and assumed higher selling, general, and administrative (SG&A) expenses. Based on these assumptions, S&P arrives at the following credit measures: -- Adjusted leverage of around 4x at the end of 2020 and around 2x by the end of 2021. -- Adjusted funds from operations to debt of around 15% to 20% in 2020 and around 40% in 2021. -- Adjusted EBITDA coverage of interest expense of around 3x at the end of 2020 and around 7x at the end of 2021. -- Adjusted discretionary cash flow (DCF) to debt of around 3% to 5% in 2020 and around zero to modestly positive in 2021 given its expectation for discretionary capital expenditures (capex). S&P believes PCI's good market position in Alabama and limited gaming tax expense may support a faster ramp in EBITDA margin than peers, as long as revenue recovers according to the rating agency's assumed base case. The rating agency expects PCI's adjusted EBITDA margin could recover and be maintained in the low- to mid-30% range by 2021, which should translate into fairly good operating cash flow generation for PCI even if revenue declines modestly in future periods. EBITDA margin above 30% compares favorably with many gaming operators and other leisure companies, and reflects PCI's strong market position in Alabama and its limited gaming tax expense, compared to many gaming operators. PCI operates the only authorized casinos in Alabama, and is insulated by distance from competitors in neighboring states including Mississippi, Florida, and North Carolina. PCI's gaming facilities are the closest gaming offerings to population centers in Alabama and Georgia (which has no casinos). Since there is limited nearby competition for PCI's Alabama casinos (which account for around 80% of run rate EBITDA), PCI does not need to spend as heavily on marketing and promotional activity to attract customers compared to commercial casinos in other states. Furthermore, the majority of PCI's revenue is not subject to gaming taxes because its Alabama properties are exempt given their tribal status. Environmental, Social, and Governance (ESG) Credit Factors for this Credit Rating change: -- Health and Safety Factors The negative outlook reflects S&P's forecast for adjusted leverage to remain elevated above its 3x leverage downgrade threshold for PCI through the first half of fiscal 2021, because it expects PCI's properties will continue to operate with capacity restrictions, and visitation and spending may be constrained by prolonged high unemployment. "We could lower ratings if EBITDA does not ramp up in a manner that would allow PCI's adjusted leverage to improve comfortably below 3x. This could occur if recovery is materially slower that we currently expect because of high unemployment or changes in customer behavior as a result of the virus, or if increasing virus cases in its primary markets led to additional property closures or more stringent operating restrictions," S&P said. "An outlook revision to stable may be considered once we are confident adjusted leverage would be sustained under 3x. We could consider higher ratings if adjusted leverage improved to 1.5x and DCF to debt is above 20%. Under our forecast, these credit measures would likely result from greater-than-expected debt reduction," the rating agency said. Before raising the rating, S&P would also need to believe: there would be no substantial change to the competitive landscape over the foreseeable future in PCI's core Alabama market; there would be continued stability in tribal government and its distribution policy; and, the authority's financial policy would support continued low leverage, including potential future acquisitions. S&P could also raise the rating if PCI, while still maintaining modest leverage, is able to reduce business risks by significantly broadening geographic and revenue diversification, improving margins, and strengthening the Wind Creek brand. PETSWAY INC: Sept. 23 Plan & Disclosure Hearing Set --------------------------------------------------- On July 20, 2020, debtor Petsway, Inc., filed with the U.S. Bankruptcy Court for the Western District of Missouri a Chapter 11 plan and a disclosure statement. On July 21, 2020, Judge Cynthia A. Norton conditionally approved the disclosure statement and established the following dates and deadlines: * Sept. 23, 2020 at 11:00 a.m. at Bankruptcy Crtrm. 2nd Floor, 222 N. John Q Hammons Pkwy, Springfield, MO is fixed for the hearing on final approval of the disclosure statement, and for the hearing on confirmation of the plan. * Sept. 1, 2020 at 11:00 a.m. is the date for status hearing to discuss any confirmation issues that should arise. * Aug. 21, 2020 is the deadline for filing with the Court objections to the disclosure statement or plan confirmation. A full-text copy of the order dated July 21, 2020, is available at https://tinyurl.com/yxlh54xy from PacerMonitor at no charge. About Petsway Inc. Founded in 1951, Petsway, Inc. -- https://petsway.com/ -- is a pet store offering pet food and supplies. Based in Springfield, Missouri, with additional locations in St. Louis and Poplar Bluff, Petsway also offers pet grooming services, dog training, monthly vet clinics, and self-serve dog washes (at select locations). Petsway filed for Chapter 11 bankruptcy protection (Bankr. W.D. Mo. Case No. 19-61542) on Dec. 30, 2019. The Hon. Cynthia A. Norton oversees the case. In its petition, the Debtor estimated $50,000 to $100,000 in assets and $1 million to $10 million in liabilities. The petition was signed by Karl W. Keller, II, vice president and co-owner. The Debtor is represented by Ronald S. Weiss, Esq. and Joel Pelofsky, Esq., at Berman, DeLeve, Kuchan & Chapman, LLC. POET TECHNOLOGIES: Provides Highlights from Annual General Meeting ------------------------------------------------------------------ POET Technologies Inc. provided shareholders an update on the Company's business, technology and product development activities during its Annual General and Special Meeting, which was held virtually on Wednesday, Aug. 26, 2020. The Company's Controller and Treasurer, Kevin Barnes, delivered customary introductions and the call to order, and POET's Lead Director, Peter Charbonneau, conducted the formal business of the Meeting, which included the approval of all proposals outlined in the Company's management information circular and voting material sent to the shareholders. After completing the formal business of the Meeting, the Company's Chief Executive Officer, Dr. Suresh Venkatesan, presented POET's vision for becoming a global leader in chip-scale integrated photonics by deploying the Company's Optical Interposer technology across a broad range of applications. Dr. Venkatesan's presentation featured the competitive differentiation of the POET Optical Interposer as a unique photonic hybrid integration platform, with multiple applications in cloud data centers, artificial intelligence and 5G communications. Vivek Rajgarhia, the Company's president & general manager, then outlined the Company's strategy and its active transition from technology to product development. His presentation highlighted the Company's product road map and four distinctive products, each of which are being driven by specific customer engagements. Rajgarhia also discussed the rationale behind the Company's $50 million joint venture announcement with Xiamen Sanan Integrated Circuit Co. Ltd., a wholly owned subsidiary of the world's largest producer of compound semiconductor wafers and emphasized how the proposed joint venture provided important credence and endorsement of the POET Optical Interposer Platform. The presentations were followed by a Q&A session. The slides presented at the Meeting along with a webcast replay can be accessed in the Investor Relations section of POET's website at: https://poet-technologies.com/agm/agm2020.html. Highlights from the Business Update * Focus on differentiation with a unifying photonics hybrid integration platform; * Completed designs of POET's 100G/200G optical engines, 400G multiplexed light bars, and 400G receivers; * Expanding IP portfolio with new patent applications, which include self-alignment features for effective passive alignment of both active die and micro-optics needed for 5G applications, and athermal external cavity lasers for co- packaged optics applications ; * Exponential data growth from cloud computing creates need for more bandwidth, driving increased data center infrastructure spending and the need for the POET optical engines; * Scalable platform solutions enable transition from 100G to 200G to 400G with minimal incremental investment; * Platform allows rapid product roll-out over the next 4 quarters, including 100/200G CWDM4 optical engines, 400G light engines, 400G FR4 receivers, 400G FR4/DR optical engines; * LOI signed for $50 million proposed JV with the world's largest producer of compound semiconductor wafers, and a completed definitive agreement expected in Q3 2020. AGSM Results At the AGSM, shareholders of the Company approved the following proposals: * Re-election of the current directors, with no director receiving less than 82% of the votes cast; * Re-appointment of Marcum LLP as the Company's Auditors; and * Amendment of the Company's stock option plan to increase the number of stock options available for grant under the plan to 58,538,554 About POET Technologies POET Technologies -- http://www.poet-technologies.com-- is a design and development company offering integration solutions based on the POET Optical Interposer, a novel platform that allows the seamless integration of electronic and photonic devices into a single multi-chip module using advanced wafer-level semiconductor manufacturing techniques and packaging methods. POET's Optical Interposer eliminates costly components and labor-intensive assembly, alignment, burn-in and testing methods employed in conventional photonics. The cost-efficient integration scheme and scalability of the POET Optical Interposer brings value to any device or system that integrates electronics and photonics, including some of the highest growth areas of computing, such as Artificial Intelligence (AI), the Internet of Things (IoT), autonomous vehicles and high-speed networking for cloud service providers and data centers. POET is headquartered in Toronto, with operations Allentown, PA and Singapore. POET Technologies reported a net loss of US$5.95 million for the year ended Dec. 31, 2019, compared to a net loss of US$16.32 million for the year ended Dec. 31, 2018. As of March 31, 2020, the Company had US$21.21 million in total assets, US$4.36 million in total liabilities, and US$16.85 million in shareholders' equity. PROVIDENT GROUP: S&P Cuts 2013 Bond Rating to BB-; Outlook Negative ------------------------------------------------------------------- S&P Global Ratings lowered its long-term rating on the District of Columbia's (D.C.) series 2013 student housing revenue bonds, issued for Provident Group-Howard Properties LLC (PGHP), a not-for-profit corporation that constructed student housing for Howard University (Howard), to 'BB-' from 'BB+' and removed it from CreditWatch Negative. The outlook is negative. On Aug. 5, 2020, S&P placed its rating on Provident Group-Howard Properties on CreditWatch with negative implications with a number of other U.S. higher education privatized (off balance sheet [OBS]) student housing projects in the wake of the COVID-19 pandemic and the uncertainties surrounding the ultimate economic fallout. "The downgrade and negative outlook reflect PGHP's operating pressures due to the loss of rental revenues as students vacated the residence facility following the onset of the COVID-19 pandemic," said S&P Global Ratings analyst Jessica Goldman. The audit for fiscal 2019 cites as a matter of emphasis a going concern issue given the pandemic's impact on operations. There was a covenant violation in 2019 (debt service coverage at 1.16x, which was under the 1.2x covenant) requiring a consultant engagement in large part driven by an issue with accounts receivable as occupancy remained solid. S&P anticipates that PGHP will be able to make remaining debt service payments in 2020 by use of surplus funds; however, due to the campus being closed to in-person instruction, and because the residences and halls will remain closed in the fall and winter 2020, there is projected debt service coverage that would be below 1x, which could lead to an event of default and acceleration of the bonds. PURDUE PHARMA: Collegium Wants Patent Litigation to Resume ---------------------------------------------------------- Drugmaker Collegium Pharmaceutical Inc., which is accused of infringing bankrupt Purdue Pharma LP's patent, asked a bankruptcy court to allow their infringement litigation to continue only if the patent office tribunal also agrees to resume the issue. Purdue can't use Chapter 11 protections "as a sword to defeat non-debtor litigants," Collegium said in a filing to the U.S. Bankruptcy Court for the Southern District of New York. The two drugmakers have been waging a legal dispute since September 2017 over Collegium's extended-release oxycodone-based pain medication Xtampza. About Purdue Pharma LP Purdue Pharma L.P. and its subsidiaries -- http://www.purduepharma.com/-- develop and provide prescription medicines and consumer products that meet the evolving needs of healthcare professionals, patients, consumers and caregivers. Purdue's subsidiaries include Adlon Therapeutics L.P., focused on treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and related disorders; Avrio Health L.P., a consumer health products company that champions an improved quality of life for people in the United States through the reimagining of innovative product solutions; Imbrium Therapeutics L.P., established to further advance the emerging portfolio and develop the pipeline in the areas of CNS, non-opioid pain medicines, and select oncology through internal research, strategic collaborations and partnerships; and Greenfield Bioventures L.P., an investment vehicle focused on value-inflection in early stages of clinical development. Opioid makers in the U.S. are facing pressure from a crackdown on the addictive drug in the wake of the opioid crisis and as state attorneys general file lawsuits against manufacturers. More than 2,000 states, counties, municipalities and Native American governments have sued Purdue Pharma and other pharmaceutical companies for their role in the opioid crisis in the U.S., which has contributed to the more than 700,000 drug overdose deaths in the U.S. since 1999. OxyContin, Purdue Pharma's most prominent pain medication, has been the target of over 2,600 civil actions pending in various state and federal courts and other fora across the United States and its territories. On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 19-23649), after reaching terms of a preliminary agreement for settling the massive opioid litigation facing the Company. The Company's consolidated balance sheet at Aug. 31, 2019, showed $1.972 billion in assets and $562 million in liabilities. U.S. Bankruptcy Judge Robert Drain, in White Plains, New York, has been assigned to oversee Purdue's Chapter 11 case. Davis Polk & Wardwell LLP and Dechert LLP are serving as legal counsel to Purdue. PJT Partners is serving as investment banker, and AlixPartners is serving as financial advisor. Prime Clerk LLC is the claims agent. QUEST PATENT: Ceases Trading on OTCQB Market -------------------------------------------- Effective Aug. 31, 2020, Quest Patent Research Corporation's common stock ceased to be trading on the OTCQB market because of the failure of the Company to maintain a bid price for its common stock of at least $0.01 per share for a period of 30 days. The common stock is currently traded on the OTC Pink Market. About Quest Patent Quest Patent Research Corporation -- http://www.qprc.com/-- is an intellectual property asset management company. The Company's principal operations include the development, acquisition, licensing and enforcement of intellectual property rights that are either owned or controlled by the Company or one of its wholly owned subsidiaries. The Company currently owns, controls or manages eleven intellectual property portfolios, which principally consist of patent rights. Quest Patent reported a net loss attributable to the Company of$1.31 million for the year ended Dec. 31, 2019, compared to a net loss attributable to the company of $2.11 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $3.35 million in total assets, $10.26 million in total liabilities, and a total stockholders' deficit of $6.90 million. MaloneBailey, LLP, in Houston, Texas, the Company's auditor since 2013, issued a "going concern" qualification in its report dated March 27, 2020 citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. REAL GOODS SOLAR: 3 Units Sent to Chapter 7 Bankruptcy ------------------------------------------------------ Dan Mika, writing for Prairie Mountain Media reports that Real Goods Solar Inc. (OTCMKTS: RGSEQ) has begun liquidation of two of its regional installation groups and its financial arm. The three subsidiaries, Alteris Renewables Inc., RGS Financing Inc. and the company behind Sunetric, all filed to begin the Chapter 7 liquidation process in the Bankruptcy Court of Colorado . Alteris and Sunetric were full-service solar installers in the Northeast region of the U.S. and Hawaii, respectively. RGS Financing was most likely a separate entity used to handle long-term payment plans for customers. Alteris and RGS Financing listed assets of $100,000 to $500,000 and liabilities below $50,000, while Sunetric listed assets between $100,000 to $500,000 and liabilities of between $1 million to $10 million, without going into further detail about the largest creditors. The formerly Louisville-based company moved to Denver in 2017. It filed for bankruptcy in March of this year after dismissing all of its employees and executives on Jan. 31 after multiple reverse stock splits and regularly being at risk of being delisted from the Nasdaq exchange for having long stretches where its stock traded below $1. RGS' filing alone lists assets of $13.4 million and $9.9 million in liabilities owed to between 200 to 999 creditors. The main bankruptcy is still active, but RGS has yet to file a full liquidation plan. RGS could not be reached for comment. Its listed phone number is disconnected and its websites are no longer available. While RGS was struggling in the months preceding its bankruptcy, the ongoing economic crisis caused by COVID-19 has upended smaller solar companies along the northern Front Range. Louisville's SunTech Drive LLC filed for Chapter 11 bankruptcy in early June, while fellow Louisville-based firm Clean Energy Collective LLC filed for bankruptcy so it can shed debts ahead of a planned sale to New York utility giant Consolidated Edison Inc. (NYSE: ED). The Solar Industries Association estimates Colorado lost as much as a third of its solar workforce in the first months of the pandemic as depressed consumer confidence hurt interest in new projects. About Real Goods Solar Inc. Real Goods Solar, Inc. (NASDAQ: RGSE) provides solar energy systems to homeowners and commercial building owners in the U.S. The Louisville, Colorado-based Company designs and offers solar energy solutions then procures, permits, installs and interconnects the system to the utility grid. RGN-ARLINGTON VI: Case Summary & Unsecured Creditor --------------------------------------------------- Debtor: RGN-Arlington VI, LLC 3000 Kellway Drive Suite 140 Carrollton, TX 75006 Business Description: RGN-Arlington VI, LLC is primarily engaged in renting and leasing real estate properties. Chapter 11 Petition Date: August 30, 2020 Court: United States Bankruptcy Court District of Delaware Case No.: 20-12023 Judge: Hon. Brendan Linehan Shannon Debtor's Counsel: Patrick A. Jackson, Esq. FAEGRE DRINKER BIDDLE & REATH LLP 222 Delaware Avenue, Suite 1410 Wilmington, Delaware 19801 Tel: (302) 467-4200 Email: Patrick.Jackson@faegredrinker.com Debtor's Financial Advisor: ALIXPARTNERS Debtor's Restructuring Advisor: DUFF & PHELPS, LLC Total Assets as of July 31, 2020: $870,713 Total Liabilities as of July 31, 2020: $6,357,919 The petition was signed by James S. Feltman, responsible officer. The Debtor listed 1101 Wilson Owner, LLC as its sole unsecured creditor holding a claim of $540,014. A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/N4GKF3Q/RGN-Arlington_VI_LLC__debke-20-12023__0001.0.pdf?mcid=tGE4TAMA RHINO RESOURCE: In Chapter 11 Due to Drop in Coal Demand -------------------------------------------------------- Law360 reports that Kentucky coal mining operation Rhino Resource Partners hit Chapter 11 in Ohio, saying a decline in demand for its metallurgical coal over the past 18 months has led to staggering operating losses. In initial court filings July 22, 2020, the Debtor said it has about $162 million of debt and suffered nearly $100 million in losses by the end of 2019 as its cost-intensive operations dealt with plunging demand from coal consumers. With operations in Ohio, Kentucky, Virginia, West Virginia and Utah, Rhino and its subsidiaries produced about 3.2 million tons of coal in 2019, down about 25% from the prior year. About Rhino Resource Partners LP Lexington, Kentucky-based Rhino Resource Partners LP (OTCQB: RHNO) is a diversified energy limited partnership that is focused on coal and energy related assets and activities, including energy infrastructure investments. The company produce, process and sell high quality coal of various steam and metallurgical grades from multiple coal producing basins in the United States. Rhino Resource market its steam coal primarily to electric utility companies as fuel for their steam powered generators. Hopedale Mining, LLC and its affiliates are diversified coal producers. They produce, process and sell coal of various steam and metallurgical grades from multiple coal-producing basins in the United States. They market steam coal primarily to electric utility companies as fuel for their steam powered generators. The companies have a geographically diverse asset base with coal reserves located in Central Appalachia, Northern Appalachia, the Illinois Basin and the Western Bituminous region. On July 22, 2020, Hopedale Mining and its affiliates, including Rhino Resource Partners LP, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ohio Lead Case No. 20-12043). At the time of the filing, Hopedale Mining had estimated assets of between $10 million and $50 million and liabilities of between $1 million and $10 million. Judge Guy R. Humphrey oversees the cases. The Debtors tapped Frost Brown Todd LLC as their bankruptcy counsel, Cambio Group LLC as restructuring advisor, Energy Ventures Analysis Inc. as financial advisor, FTI Consulting Inc. as bankruptcy consultant, and Epiq Corporate Restructuring LLC as claims and noticing agent. On July 30, 2020, the Office of the U.S. Trustee appointed an official committee of unsecured creditors. The committee has retained Foley & Lardner LLP and Barber Law PLLC as its legal counsel and B. Riley FBR, Inc. as its financial advisor. ROBERT ALLEN: $74K Sale of Pocatello Properties to Land Quest OK'd ------------------------------------------------------------------ Judge Joseph M. Meier of the U.S. Bankruptcy Court for the District of Idaho authorized Robert Allen Auto Group, Inc.'s sale to Land Quest Development, Inc. of the lots identified in Exhibit A as the 6th Street Lot (Legal description of Lots 7 & W70' Lots 9 & 10, Block 270, Pocatello Townsite) for $49,000, and the Lander Street Lot (Legal of Lots 1 & 2, Block 269, Pocatello Townsite) for $25,000, totaling less than half an acre. Nissan Motor Acceptance Corp.'s lien will attach to proceeds from the sale of the two lots subject of the Sale Motion. All net proceeds from the closings after payment of real property taxes, commissions and standard costs of sale will be held by the title company pending further agreement between the Debtor and Nissan. A copy of the Exhibits is available for free at https://tinyurl.com/y73josvg from PacerMonitor.com free of charge. About Robert Allen Auto Group Robert Allen Auto Group, Inc., is a dealer of automobiles based in Pocatello, Idaho. Robert Allen Auto Group filed a Chapter 11 petition (Bankr. D. Idaho Case No. 20-40163) on March 2, 2020. In the petition signed by Robert Allen, president, the Debtor disclosed $4,312,279 in assets and $2,097,927 in liabilities. Steven L. Taggart, Esq., at MAYNES TAGGART PLLC, serves as bankruptcy counsel to the Debtor. Shawn Perry is the real estate agent for the estate. RTW RETAILWIND: Plans to Close 2 Stores in Richmond Malls --------------------------------------------------------- Jack Jacobs, writing for Richmond Bizsense, reports that a women's clothing retailer will shut down both of its Richmond, Virginia-region stores as its parent company declares bankruptcy. New York and Co. locations at Short Pump Town Center and Chesterfield Towne Center are closing. That follows the Chapter 11 bankruptcy filing this month of New York-based parent company RTW Retailwinds Inc. The company owns New York and Co. along with other brands, and announced it would close "a significant portion, if not all, of its brick-and-mortar stores." It's unclear when the two local stores will close for good. A New York and Co. spokeswoman didn't respond to a request for comment. A spokeswoman for Brookfield Properties, which owns Short Pump and Chesterfield Towne Center, didn't respond to a request for comment. Both stores advertised closing sales July 21, 2020. The company said its bankruptcy filing was related to economic disruptions brought on by the coronavirus pandemic amid general challenges in the retail sector. The departure of New York and Co. from Richmond comes amid a larger culling of malls' tenants. Nordstrom announced in May it would permanently close at Short Pump. The anchor tenant had moved out of its 120,000-square-foot space by mid-July. Sur La Table is leaving Stony Point Fashion Park, following the closing of the mall's Panera and H&M store. About RTW Retailwinds RTW Retailwinds, Inc. [OTC PINK:RTWI], formerly known as New York & Company, Inc., is a specialty women's omni-channel retailer with a powerful multi-brand lifestyle platform providing curated fashion solutions that are versatile, on-trend, and stylish at a great value. The specialty retailer, first incorporated in 1918, has grown to now operate 378 retail and outlet locations in 32 states while also growing a substantial eCommerce business. The Company's portfolio includes branded merchandise from New York & Company, Fashion to Figure, and Happy x Nature. The Company's branded merchandise is sold exclusively at its retail locations and online at http://www.nyandcompany.com/, http://www.fashiontofigure.com/, http://www.happyxnature.com/,and through its rental subscription businesses at http://www.nyandcompanycloset.com/and http://www.fashiontofigurecloset.com/ RTW Retailwinds, Inc. and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D.N.J. Case No. 20-18445) on July 13, 2020. The petitions were signed by Sheamus Toal, CEO, CFO and treasurer. As of July 13, 2020, the Debtors reported total assets of $405,356,610 and total liabilities of $449,962,395. The Hon. John K. Sherwood presides over the cases. Michael D. Sirota, Esq., Stuart Komrower, Esq., Ryan T. Jareck, Esq., and Matteo W. Percontino, Esq. of Cole Schotz P.C. serve as counsel to the Debtors. Berkeley Research Group, LLC, has been tapped as financial advisor to the Debtors; B. Riley FBR, Inc. as investment banker; and Prime Clerk, LLC as claims and noticing agent. SALIENT CRGT: S&P Affirms 'B-' ICR; Outlook Negative ---------------------------------------------------- S&P Global Ratings affirmed all ratings on Salient CRGT Inc., a health, data analytics, cloud, cyber security, and infrastructure solutions provider, including its 'B-' issuer credit rating. The outlook remains negative. S&P expects a modest improvement in Salient's revenue in 2020, with marginal expansion in 2021. COVID-19-related pressures slowed Salient's ability to ramp up new business at the rate it had initially anticipated. Social distancing guidelines and precautions affected the company's ability to perform work on people-centric contracts. In addition, COVID-19 caused delays in the bidding and awards process as government operations shifted to work-from-home. The company remains committed to increasing ramp up of new contracts at an accelerated pace through the rest of the year. However, S&P expects revenue growth will remain modest at best given the uncertainty surrounding COVID-19. Although S&P expects revenue growth in the high-single-digit percent area in 2020, the company's 2019 revenue declined more than the rating agency previously expected. S&P believes there is a risk that Salient will breach the leverage covenants under its credit agreement when the covenants step down over the next 6 to 12 months. Last year, Salient amended its credit agreement to provide covenant relief on its first-lien debt. Salient has remained in compliance with this amended covenant through the first half of the year with a very limited cushion. Furthermore, there is an additional 0.25x step down in the first quarter of 2021 and an additional 0.25x step down in the third quarter. As a result, S&P expects limited covenant headroom over the next 12 months. "We expect liquidity to be constrained somewhat in 2020. We believe Salient would not be able to draw its revolver without breaching its financial covenant. If it were to breach its financial covenant, it will no longer have access to its $35 million revolver. However, despite the possibility for access to its revolver, we do not view the company as having near-term cash liquidity concerns. The revolver is currently undrawn and the company has been generating free cash flow and does not face any near term maturities outside of required amortization," S&P said. "The negative outlook reflects our expectation that Salient CRGT may be in violation of its financial covenant if no action is taken over the next 6 to 12 months. Broadly speaking, in our macro view, the negative outlook also reflects revenue pressures related to COVID-19, affecting the bid pipeline and ramp up of new contracts," S&P said. "We could lower our rating on Salient CRGT if it violates the leverage covenant and is unable to amend its credit facility or secure a waiver for the covenant such that its liquidity becomes further constrained. We could also lower our rating if we believe the company may enter into a distressed exchange to prevent a covenant breach. We could also lower the rating if the company is unable to grow revenue, increase earnings, or reduce debt such that leverage becomes unsustainable in our view," S&P said. S&P could revise its outlook on Salient to stable in the next 12 months if the company increases the cushion under its leverage covenant to at least 15% by amending its credit facility or increasing its earnings at a faster pace than the rating agency currently expects. S&P would also want to be reasonably certain that the company would not violate its covenants and maintains debt to EBITDA margin in the 7x-8x range. SCOTT C. GRAY: $940K Sale of Santa Rosa Residential Property Okayed ------------------------------------------------------------------- Judge Bruce C. Bessley of the U.S. Bankruptcy Court for the District of Nevada authorized Scott C. Gray to enter into a California Residential Purchase Agreement and Joint Escrow Instructions with Deepinder S. Sekhon and Jeanne M. Sekhon for the sale of the real property commonly described as 4562 Badger Road, Santa Rosa, Sonoma County, California for $940,000. The first mortgage encumbering the Property in favor of Wells Fargo Home Mortgage, evidenced by the Deed of Trust recorded on June 21, 2005, as Instrument No. 2005-086301, Official Records of Sonoma County; the second mortgage in favor of the Lynn and Forest Tardibuono Trust, evidenced by Deed of Trust recorded on Jan. 27, 2015, as Instrument No. 2015-005947, Official Records of Sonoma County; outstanding real property taxes, if any; a commission of $36,000 due to the Debtor's listing broker, W Real Estate, together with all costs of sale normally borne by seller, will be paid directly out of escrow upon closing. The net proceeds of sale will be all proceeds remaining after payment of the amounts set forth. The Property will be sold free and clear of all liens and/or claims including, but not limited to, the Action and Abstract of Judgment shown as liens and claims in favor of Steve Friedman, Debra Friedman and Lori Valenziano, evidenced by Instrument No. 2017-7625 recorded on Jan. 30, 2017 and Instrument No. 2017-088985 recorded on Nov. 17, 2017, Official Records of Sonoma County (Exceptions 13 and 14 shown on the Preliminary Title Report for the Property), and the Friedman Claim will attach to the Net Proceeds until the Friedman Claim is determined by the Bankruptcy Court or otherwise resolved. Subject to further Order of the Court, any Net Proceeds remaining after payment and resolution of the Friedman Claim will be held subject to determination of any and all amounts found to be due and owing under the Judgment on Stipulation in favor of Josephine Ross (deceased), her successors, assigns or any appointed representative in any capacity, entered on Jan. 19, 2017, in the Superior Court of California, County of Sonoma, Case No. SCV-258977, entitled Josephine Ross, et al. v. Gayle Diane Gray, et al. The Net Proceeds will be distributed to the Debtor's attorney who may apply $25,216 of the Net Proceeds to pay his previously approved fees and costs by the Order Approving Amended Second Interim Application by Attorney for Debtor to Approve Compensation (Willian D. Cope) and the Order Approving Second Amended First Interim Application by Attorney for Debtor to Approve Compensation (William D. Cope). The Debtor's attorney will hold the balance of the Net Proceeds in trust pending final resolution of the Friedman Claim and the Ross Claim. No funds may be distributed from the Net Proceeds without further order of the Court. A hearing on the Motion was held on Aug. 11, 2020 at 2:00 p.m. Scott C. Gray sought Chapter 11 protection (Bankr. D. Nev. Case No. 18-50249) on March 13, 2018. The Debtor tapped William D. Cope, Esq., as counsel. SEVEN COUNTIES: Eligible to File for Chapter 11, Ky. S.C. Rules --------------------------------------------------------------- Bloomberg Law reports that Kentucky Supreme Court has given its decision related to the eligibility of the nonprofit mental health service provider Seven Counties Services Inc. to file Chapter 11. After certification of a question to the Kentucky Supreme Court, the Sixth Circuit affirmed its prior decision that nonprofit provider of mental health services Seven Counties Services Inc., which participated in the Kentucky Employees Retirement System, is a non-governmental unit eligible to file for Chapter 11 bankruptcy protection, but it reversed its conclusion that Seven Counties need not maintain its statutory contribution obligations during the pendency of the bankruptcy. About Seven Counties Services Seven Counties Services Inc., a not-for-profit behavioral services provider from Louisville, Kentucky, filed for Chapter 11 protection (Bankr. W.D. Ky. Case No. 13-31442) on April 4, 2013. The agency generates more than $100 million a year in revenue and employs a staff of 1,400 providing services at 21 locations and 120 schools and community centers. The petition was signed by Anthony M. Zipple as president/CEO. The Debtor scheduled assets of $45.6 million and scheduled liabilities of $233 million. Judge Joan A. Lloyd presides over the case. David M. Cantor, Esq., Neil C. Bordy, Esq., Charity B. Neukomm, Esq., Tyler R. Yeager, Esq., and James E. McGhee III, Esq., at Seiller Waterman LLC, serve as counsel to the Debtor. Bingham Greenebaum Doll LLP and Wyatt, Tarrant & Combs LLP have been retained by the Debtor as special counsel. Hall, Render, Killian, Heath & Lyman, PLLC, is special counsel to represent and advise it in the implementation of its new software system. Peritus Public Relations, LLC, has been tapped to provide public relations and public affairs support in Kentucky. Fifth Third Bank, the cash collateral lender, is represented by Brian H. Meldrum, Esq., at STITES & HARBISON PLLC; and Robert C. Goodrich, Jr., Esq., at Stites & Harbison PLLC. SEVEN COUNTIES: On Hook on Its Pension Contributions ---------------------------------------------------- Law360 reports that the Sixth Circuit has found that a Kentucky-based mental health services provider couldn't dodge its obligations to the state's public pension plan while its bankruptcy was pending, finding the nonprofit had a state law duty to contribute. In a July 20, 2020, decision, a three-judge panel said that Seven Counties Services Inc. had a statutory obligation to make contributions into the Kentucky Employees Retirement System during the pendency of its bankruptcy. Writing for the panel majority, Circuit Judge Jane Branstetter Stranch said the Kentucky Supreme Court has found that the contributions to the system were mandated by statute rather than by contract. About Seven Counties Services Seven Counties Services Inc., a not-for-profit behavioral health and developmental services center from Louisville, Kentucky, filed for Chapter 11 protection (Bankr. W.D. Ky. Case No. 13-31442) on April 4, 2013. It provides services at several locations, schools and community centers covering Jefferson, Bullitt, Henry, Oldham, Shelby, Spencer and Trimble counties. In the petition signed by Anthony M. Zipple as president/CEO, the Debtor scheduled assets of $45.6 million and scheduled liabilities of $233 million. Judge Joan A. Lloyd oversees the case. David M. Cantor, Esq., Neil C. Bordy, Esq., Charity B. Neukomm, Esq., Tyler R. Yeager, Esq., and James E. McGhee III, Esq., at Seiller Waterman LLC, serve as counsel to the Debtor. Bingham Greenebaum Doll LLP and Wyatt, Tarrant & Combs LLP have been retained by the Debtor as special counsel. Hall, Render, Killian, Heath & Lyman, PLLC, is special counsel to represent and advise it in the implementation of its new software system. Peritus Public Relations, LLC, has been tapped to provide public relations and public affairs support in Kentucky. Fifth Third Bank, the cash collateral lender, is represented by Brian H. Meldrum, Esq., at STITES & HARBISON PLLC; and Robert C. Goodrich, Jr., Esq., at Stites & Harbison PLLC. In October 2016, Seven Counties announced its merger with not-for-profit Tennessee-based Centerstone. The combined operations became known as Centerstone of Kentucky. Seven Counties president and CEO Zipple became CEO of Centerstone of Kentucky. SPIRIT AIRLINES: Fitch Rates $600MM Secured Notes 'BB+/RR1' ----------------------------------------------------------- Fitch has assigned a rating of 'BB+'/'RR1' to Spirit Airlines proposed $600 million senior secured notes to be secured by its loyalty program, including revenues from its co-branded credit cards and $9 Fare Club, and associated intellectual property along with its brand IP. Fitch has also affirmed Spirit's Long-Term Issuer Default Rating (IDR) at 'BB-'. The rating Outlook remains Negative. Spirit's corporate rating remains under pressure driven by a combination of slower than expected recovery from the impact of coronavirus and higher debt levels that may push Spirit's credit metrics outside of ranges supportive of the 'BB-' rating at least through the next one to two years. These risks are partly offset by Spirit's healthy liquidity balance, its low-cost structure, and its exposure to domestic leisure and visiting friends and relatives (VFR) markets that are likely to recover more quickly than business or long-haul travel. Should traffic in Spirit's key markets remain subdued through the end of the year, or should cash burn fail to improve, Fitch will likely downgrade Spirit into the 'B' category. KEY RATING DRIVERS Transaction Ratings: Fitch's rating of 'BB+'/'RR1' on the proposed secured notes reflects the agency's estimate that creditors would receive superior recovery in a bankruptcy scenario. The 'BB+'/'RR1' rating is based on Fitch's generic approach to assigning issue ratings for issuers rated in the 'BB' category, which assumes that secured creditors will recover 91%-100% of principal value in a distress scenario. Fitch's analysis was reinforced via a bespoke recovery analysis. Fitch's recovery analysis is based on a going-concern scenario in which the agency uses an estimated sustainable EBITDAR of $650 million and an EV multiple of 5.5x times. Fitch's EBITDAR estimate is conservative and reflects a scenario where domestic demand remains well below pre-pandemic levels for the next several years. The EV multiple is reflective of prior airline bankruptcies. Fitch's estimate of a going-concern enterprise value is more than sufficient to cover all secured claims. Recovery on the loyalty program notes is supported by independent appraisals that value the total collateral at $2.9 billion. Fitch believes the core nature of the collateral represented by the revenue and generated by the loyalty program and $9 fare club along with the necessity to maintain access to the Spirit brand provide compelling motivation for the airline to affirm its obligations in a bankruptcy scenario. However, the value of the assets largely rests on Spirit continuing as a going concern. Liquidation of the airline would materially impact the collateral values and weaken recovery. Transaction Description: The co-issuers of the USD600m senior secured notes are special purpose vehicles Brand IP Issuer and Loyalty IP Issuer. They are both owned by the holding company HoldCo2 (an SPV), which is in turn fully owned by HoldCo1 (an SPV), which in turn is fully owned by Spirit, which will also be the transaction's manager. All these SPVs are newly formed Cayman Island entities and are collectively referred to as obligors in the transaction docs. The HoldCos have independent directors to mitigate the consolidation risk in case of Spirit's bankruptcy. Spirit also acts as parent guarantor of the co-issuer's obligations under the transaction documents. The HoldCos also guarantee those obligations. The issuance proceeds will be used, in addition to funding Spirit's general corporate purposes through an intercompany loan, to also fund a reserve account to cover the following quarter's interest payment. The notes mature in 2025 after five years of interest only payments and the 2025 maturity would not allow extensions. For this reason, the transaction differs from the United Airlines sponsored transaction Mileage Plus Intellectual Property Assets, Ltd (rated 'BBB-' in July). This is the primary reason that Fitch has rated the transaction under its corporate recovery and notching criteria rather than its Future Flow Securitization Rating Criteria. The fixed coupon of the notes depends on the LTV ratio. If the LTV is up to 62.5%, the coupon is X, while higher LTVs would result in a coupon of X+2%. The LTV ratio is calculated semiannually and is equal to the outstanding principal number of notes, divided by (b) the value of the collateral determined at the most recent semi-annual appraisal (or more frequent if Spirit so elects). A distinguishing feature of the collateral package, compared to similar transactions, is the membership fee from the $9 Fare Club, as Spirit has a loyalty program club where members/customers are charged a fee to access discounts and other benefit (unlike most traditional airlines). Security Package: The obligations of the obligors under the documentation are secured by the first priority perfected security interest in the following assets: a pledge by Spirit of 100% of the equity interests in HoldCo1, by HoldCo1 of 100% of the equity interests in HoldCo2, and by HoldCo2 of 100% of the equity interests in each of the co-issuers; a pledge by all the obligors of the Free Spirit Agreements; each of the co-issuer's and Spirit's rights under the IP agreements, the Controlled Accounts (including all membership fees from the $9 Fare Club credited there), all investments made with funds therein; all other right, title and interest in all assets of each of HoldCo 1, HoldCo 2 and the co-issuers (including the Brand Contributed Property, the Loyalty contributed Property, and the Spirit Intercompany Loan. Corporate Rating: The Negative Outlook reflects uncertainties around the timing of traffic recovering beyond 2021. Fitch expects that traffic will take longer to recover than previously expected, and Spirit's rising debt balance and adds further pressure to the rating. However, liquidity remains healthy and prospects for improving cash burn remain supportive. Air Traffic Recovery Lagging Initial Expectations: Ongoing high levels of reported COVID cases and travel restrictions are leading to a prolonged recovery in air traffic compared to Fitch's prior forecast. The industry saw a material rebound in demand off of April through levels, but the pace of recovery slowed as reported cases began to rise again in June. Fitch expects traffic levels to remain anemic until case levels improve substantially or until more effective treatments or a vaccine become widely available. Fitch's updated forecast for Spirit anticipates that total revenue will be as much as approximately 75% in the third quarter and around 60% in the fourth quarter compared to 2019 levels. This compares to down 65% and down 50% for the third and fourth quarter in Fitch's April forecast. There is a high degree of uncertainty in forecasts for 2021 travel demand. The pace of recovery is likely to be dependent on how effective efforts are at controlling COVID cases through the fall and winter along with the timing of potential treatments or vaccines. In any scenario, 2021 traffic is unlikely to recover as quickly as Fitch previously expected, pushing the timeline for North American airlines to reach more normalized levels of cash flow and profitability until at least some time in 2022. Fitch's base case now has Spirit's total traffic in 2021 down by a third from 2019 levels. While its base case is more pessimistic, Fitch believes that a vaccine/more effective treatments along with pent up demand could spur a more rapid rebound later next year. This is particularly true for domestic/leisure focused carriers like Spirit. The company has minimal exposure to business travel, or long-haul international which are likely to take longer to rebound. Reduced flexibility following this offering: Spirit plans to raise funds against its loyalty program and brand intellectual property, which Fitch estimates is one of its most valuable assets. Doing so will reduce the ability to raise future funds. Spirit estimates that it still has some $600 million in other unencumbered assets after it secured its loyalty program and brand, which could be used to raise additional liquidity. Spirit's unencumbered planes largely consist of Airbus A319s. The value of the assets may come under pressure as the coronavirus continues to impact the industry and amount of new debt that can be secured against them could be reduced. Fitch believes that Spirit has sufficient liquidity to manage through this crisis, but its flexibility to manage through future shocks will be diminished. Meaningful Liquidity Balance: Spirit ended the second quarter with more than $1.2 billion of cash on hand and a manageable cash burn rate. Pro forma for this transaction, Fitch expects Spirit to end the third quarter with north of $1.6 billion of liquidity, using conservative assumptions for revenue, leaving the company with a meaningful amount of cushion even assuming no improvement in cash burn rates from the third quarter. The company expects to burn between $3 million to 4 million/day during the third quarter. Fitch's assumptions are modestly conservative to management's forecast. Fitch's base case which assumes a slow, but steady, recovery in domestic travel through 2021 cash burn to slow meaningfully or turn positive next year, leaving Spirit with a healthy liquidity balance at YE 2021. Low Cost Structure Remains an Advantage: Spirit's CASM ex-fuel is more than 30% below its closest competitor, which is a key advantage in that the company can stimulate demand with low fares and remain profitable. This will be particularly important as other carriers increasingly compete for domestic and leisure travel due to a slow rebound in business and international traffic. DERIVATION SUMMARY Spirit's ratings are a notch above carriers such as WestJet and Hawaiian Airlines, with the difference supported by Spirit's low-cost structure and its exposure and lack of exposure to international markets. Spirit's 'BB-' rating is in line with United Airlines. Fitch views United as having more financial flexibility but this is offset by the carriers' reliance on international and business travel, which is likely to be under pressure for longer due to the coronavirus pandemic. KEY ASSUMPTIONS Key Assumptions in Fitch's rating case include a steep drop in demand through 2020, with full recovery not occurring until 2023 or later. As of Fitch's last full review, the base forecast included revenues down by roughly 90% through the second quarter of the year, down as much as 60%-65% in the third quarter, and down at least 30% in the fourth quarter for domestic focused carriers and closer to 50% for carriers with more international exposure. These assumptions are under review and could be revised lower in light of slower than expected recovery in passenger traffic. RATING SENSITIVITIES Factors that could, individually or collectively, lead to a positive rating action/upgrade: -- Adjusted debt/EBITDAR sustained below 4.25x; -- FFO fixed-charge coverage sustained around 3.0x; -- FCF generation above Fitch's base case expectations. Factors that could, individually or collectively, lead to a negative rating action/downgrade: -- Adjusted debt/EBITDAR sustained above 4.75x; -- EBITDAR margins deteriorating into the low double-digit range; -- FFO fixed-charge coverage sustained at 2x or below; -- Liquidity declining towards 10% of LTM revenue. ESG CONSIDERATIONS The highest level of ESG credit relevance, if present, is a score of 3. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity(ies), either due to their nature or to the way in which they are being managed by the entity(ies). STEPHEN JAY ROBERSON: $515K Cash Sale of Frankin Property Approved ------------------------------------------------------------------ Judge Charles M. Walker of the U.S. Bankruptcy Court for the Middle District of Tennessee authorized Stephen Jay Roberson's sale of the real property located at 5609 Hearthstone Ln, Franklin, Tennessee to Roger Barnett and Patricia Apple for $515,000, cash, pursuant to their Purchase and Sale Agreement. The sale is free and clear of liens, claims, encumbrances and interests. A 6% sales commission to Rose Rainey of Great South Real Estate and Development (3%), and to Jen Barczykowski of The Ashton Real Estate Group of RE/MAX Advantage (3%) in the total amount of $30,900, is authorized and may be paid. The 14-day stay under Bankruptcy Rule 6004(h) is waived. Stephen Jay Roberson sought Chapter 11 protection (Bankr. M.D. Tenn. Case No. 19-06662) on Oct. 14, 2019. The Debtor tapped Marie Kimberly Stagg, Esq., at Dickinson Wright PLLC, as counsel. TAILORED BRANDS: Walks Away From 100 Retail Leases -------------------------------------------------- CoStar News reports that a bankruptcy court judge is giving Tailored Brands permission to walk away from 100 retail leases including high-profile locations in downtown Chicago, Houston, and in the World Trade Center district in New York City, a move that's becoming more common for national retailers struggling during the coronavirus pandemic. About Tailored Brands Tailored Brands, Inc., (NYSE: TLRD) is an omni-channel specialty retailer of menswear, including suits, formalwear and a broad selection of polished and business casual offerings. It delivers personalized products and services through its convenient network of over 1,400 stores in the United States and Canada as well as its branded e-commerce websites at http://www.menswearhouse.com/and http://www.josbank.com. Its brands include Men's Wearhouse, Jos. A. Bank, Moores Clothing for Men and K&G. Tailored Brands reported a net loss of $82.28 million for the year ended Feb. 1, 2020, compared to net earnings of $83.24 million for the year ended Feb. 2, 2019. As of Feb. 1, 2020, the Company had $2.42 billion in total assets, $2.52 billion in total liabilities, and a total shareholders' deficit of $98.31 million. On Aug. 2, 2020, Tailored Brands and its subsidiaries sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33900) on Aug. 2, 2020. As of July 4, 2020, Tailored Brands disclosed $2,482,124,043 in total assets and $2,839,642,691 in total liabilities. The Hon. Marvin Isgur is the case judge. The Debtors tapped Kirkland & Ellis LLP as general bankruptcy counsel; Jackson Walker L.L.P., Stikeman Elliot LLP and Mourant Ozannes as co-bankruptcy counsel; PJT Partners LP as financial advisor; Alixpartners, LLP as restructuring advisor; and A&G Realty Partners, LLC as the real estate consultant and advisor. Prime Clerk LLC is the claims agent. TAMPA BAY MARINE: $27K Sale of 2016 Ford F350 Truck to Jaeger OK'd ------------------------------------------------------------------ Judge Caryl E. Delano of the U.S. Bankruptcy Court for the Middle District of Florida authorized Tampa Bay Marine Towing & Service, Inc. 's sale of its 2016 Ford F350 truck, VIN 1FT8W3DT9GEB92037, to Erich Jaeger for $27,000. A hearing on the Motion was held on Aug. 10, 2020 at 2:00 p.m. The sale is free and clear of all liens, claims, interests and encumbrances. Upon closing of the sale of the Truck, the Debtor will pay Ford Motor Credit Co., LLC ("FMCC") the balance owed pursuant to FMCC's purchase money security interest. The Debtor will also ensure payment of the appropriate amount of sales tax due upon closing of the sale of the Truck. The Debtor will deposit the net proceeds of the sale of the Truck into its DIP Bank Account. It is authorized to use the proceeds of the sale of the Truck for ongoing business operations subject to the limitations of any operable orders governing cash collateral. The Debtor will provide the Office of the U.S. Trustee the closing statement and bill of sale relative to the sale of the Truck within 14 days of the closing of the sale. Attorney Jake C. Blanchard, Esq. is directed to serve a copy of the order on interested parties and file a proof of service within three days of entry of the Order. About Tampa Bay Marine Towing & Service Tampa Bay Marine Towing & Service, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-01418) on Feb. 14, 2020, listing under $1 million in both assets and liabilities. Judge Caryl E. Delano oversees the case. Blanchard Law P.A. is the Debtor's legal counsel. TOWN SPORTS: Moody's Cuts CFR to C, Outlook Remains Stable ---------------------------------------------------------- Moody's Investors Service downgraded Town Sports International, LLC's Corporate Family Rating to C from Ca, Probability of Default Rating to C-PD/LD from Ca-PD, and first lien credit facilities to C from Ca. Moody's also took no action on the company's Speculative Grade Liquidity Rating of SGL-4. The outlook remains stable. Town Sports International, LLC is a wholly owned subsidiary of the publicly traded company Town Sports International Holdings, Inc. together referred to as "Town Sports". Moody's downgraded the CFR to C due to the missed payment on the revolver at expiration, the company's weak liquidity and high risk of a balance sheet restructuring, and Moody's expectation for a low credit facility recovery rate. Town Sports' $15 million first lien revolver expired on August 14 with $14.2 million outstanding. The missed payment on the revolver is considered an event of default. The /LD appended to the PDR reflects the default on the revolver. The failure to repay the revolver provides lenders the option to accelerate the outstanding balance on the company's first lien term loan ($178 million) that matures in November 2020. The company has disclosed in an 8K filing that it is in discussions with its lenders regarding obtaining an extension to the maturity date of the revolver or entering into a forbearance agreement that would forestall the exercise of remedies under the Credit Agreement (1). The company has not disclosed whether it is current on the term loan interest or if the term loan lenders have taken action to accelerate. Moody's took the following rating actions: Issuer: Town Sports International, LLC Corporate Family Rating, downgraded to C from Ca Probability of Default Rating, downgraded to C-PD/LD from Ca-PD Speculative Grade Liquidity Rating, unchanged at SGL-4 Senior secured revolving credit facility, downgraded to C (LGD5) from Ca (LGD4) Senior secured term loan, downgraded to C (LGD5) from Ca (LGD4) Outlook actions: Outlook: Remains Stable Subsequent to the actions, Moody's will withdraw the ratings for Town Sports. Moody's has decided to withdraw the ratings because it believes it has insufficient or otherwise inadequate information to support the maintenance of the ratings. RATINGS RATIONALE Town Sports' C CFR reflects the very high risk of a balance sheet restructuring, weak liquidity, and the low expected debt instrument recovery rate. The company's declining operating performance was exacerbated by the coronavirus crisis with mandated gym closures in mid- March. Some facilities have reopened but membership levels are unknown. The rating also reflects Town Sports concentration in the highly fragmented and competitive fitness club industry, which has low barriers to entry, high attrition rates, and is experiencing a trend towards either high-end or budget gym memberships that places pressure on the mid-tier price point in which Town Sports currently operates. Fitness club memberships are discretionary and revenue and earnings are pressured when household income weakens. However, the rating considers the company's well-recognized brand name in its operating markets. 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. The action reflects the impact on Town Sports, 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. The SGL-4 speculative-grade liquidity rating reflects the company's weak liquidity because the entire debt structure matures in 2020. The company had a consolidated cash balance, including unrestricted subsidiaries, of $18.8 million as of December 2019 and estimated in June that it will need up to $80 million to fund potential fees related to a possible bankruptcy filing and operating shortfalls (2). The stable outlook reflects Moody's expectation that the high default probability and low recovery rate expectation is appropriately reflected in the C rating. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if the clubs reopen, membership, revenue and earnings recover meaningfully, and the company successfully refinances its first lien credit facilities at a manageable cost. The Probability of Default Rating could be lowered to D-PD if the company defaults on its entire debt capital structure. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Headquartered in Jupiter, FL, Town Sports International Holdings, Inc., through its wholly-owned operating subsidiaries which include Town Sports International, LLC, owns and operates about 186 fitness clubs in 7 states, the District of Columbia, Puerto Rico and 3 clubs in Switzerland. Revenue for the fiscal year ended December 31, 2019 was about $467 million. VIRGINIA TRUE: Cipollones Object to Diatomite's Plan & Disclosure ----------------------------------------------------------------- Creditors Domenick Cipollone and Anthony Cipollone object to the motion of Diatomite Corporation of America for entry of an order approving adequacy of its Disclosure Statement with regard to its proposed Plan of Liquidation for Debtor Virginia True Corporation. The Cipollones assert that: * The Disclosure Statement fails to provide "information relevant to the risks posed to creditors under the plan" as it pertains to litigation regarding the Cipollones' claim and to address "litigation likely to arise in a nonbankruptcy context." * The Disclosure Statement lacks any disclosure regarding the Virginia Action filed against Diatomite, and its principal, Appelstein, among other parties, asserting claims against them for tortious interference with contract, and common law conspiracy, which was removed to the U.S. Bankruptcy Court for the Eastern District of Virginia. * The Disclosure Statement is inadequate with respect to “a description of the available assets and their value” in that it fails to note the discrepancy among valuations for the Property that have appeared in the case and appears to rely on an artificially low valuation of $8.2 million, and does not address or acknowledge that the Cipollones obtained an appraisal of the Property valued at $13.5. * The Plan described in the Disclosure Statement is patently unconfirmable because Diatomite will receive the Property, which by its own valuation is worth $8.2 million, whereas by the Cipollones’ valuation is worth $13.5 million, and by the Debtor’s valuation is worth between $13.5 million and $18.3 million, while creditors are only to receive an estimated $500,000, with the Cipollones receiving nothing. * The Cipollones have pending claims against Diatomite and Appelstein that are not discussed or disclosed in the Disclosure Statement, and for which they are to receive complete exculpation under the Plan even though these claims are not claims arising from the chapter 11 case itself and the Cipollones would take nothing under the Plan. A full-text copy of the Cipollones' objection to Diatomite Disclosure Statement and Plan dated July 21, 2020, is available at https://tinyurl.com/y36q8sqf from PacerMonitor at no charge. Attorneys for Creditors: Stephen Z. Starr, Esq. STARR & STARR, PLLC 260 Madison Ave., 17th Floor New York, New York 10016 Tel: (212) 867-8165 Fax: (212) 867-8139 E-mail: sstarr@starrandstarr.com About Virginia True Corporation Virginia True Corporation, a New York-based golf resort owner and developer, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 19-42769) on May 3, 2019. At the time of the filing, the Debtor disclosed assets of between $10 million and $50 million and liabilities of the same range. Judge Nancy Hershey Lord oversees the case. Pick & Zabicki LLP is the Debtor's legal counsel. WEINSTEIN CO: Two Actresses Want Case Converted to Chapter 7 ------------------------------------------------------------ Law360 reports that two actresses who say they were sexually assaulted by Harvey Weinstein asked a Delaware bankruptcy judge July 21, 2020, to liquidate his entertainment company's estate, after a New York federal judge rejected a global settlement that the women slammed as a "deathtrap. "In a 14-page motion, actresses Wedil David and Dominique Huett asked U.S. Bankruptcy Judge Mary F. Walrath to convert The Weinstein Co.'s Chapter 11 case into Chapter 7 proceedings. The pair argued that the entertainment company has achieved all it can in Chapter 11 by selling off most of its assets to Lantern Entertainment LLC — Spyglass Media Group LLC's predecessor. About Weinstein Co. The Weinstein Company (TWC) -- http://www.WeinsteinCo.com/-- is a multimedia production and distribution company launched in 2005 in New York by Bob and Harvey Weinstein, the brothers who founded Miramax Films in 1979. TWC also encompasses Dimension Films, the genre label founded in 1993 by Bob Weinstein. During Harvey and Bob's tenure at Miramax and TWC, they have received 341 Oscar nominations and won 81 Academy Awards. TWC dismissed Harvey Weinstein in October 2017, after dozens of women came forward to accuse him of sexual harassment, assault or rape. The Weinstein Company Holdings LLC and 54 affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 18-10601) on March 19, 2018, after reaching a deal to sell all assets to Lantern Asset Management for $310 million. The Weinstein Company Holdings estimated $500 million to $1 billion in assets and $500 million to $1 billion in liabilities. The Hon. Mary F. Walrath is the case judge. Cravath, Swaine & Moore LLP is the Debtors' bankruptcy counsel, with the engagement led by Paul H. Zumbro, George E. Zobitz, and Karin A. DeMasi, in New York. Richards, Layton & Finger, P.A., is the local counsel, with the engagement headed by Mark D. Collins, Paul N. Heath, Zachary I. Shapiro, Brett M. Haywood, and David T. Queroli, in Wilmington, Delaware. The Debtors also tapped FTI Consulting, Inc., as restructuring advisor; Moelis & Company LLC as investment banker; and Epiq Bankruptcy Solutions, LLC as claims and noticing agent. The Office of the U.S. Trustee for Region 3 appointed an official committee of unsecured creditors on March 28, 2018. The Committee retained Pachulski Stang Ziehl & Jones, LLP as its legal counsel, and Berkeley Research Group, LLC as its financial advisor. WHEEL PROS: S&P Alters Outlook to Stable, Affirms 'B-' ICR ---------------------------------------------------------- S&P Global Ratings revised its outlook on Wheel Pros Inc. to stable from negative and affirmed its 'B-' issuer credit rating. The outlook revision and affirmation reflect S&P's updated forecast for adjusted debt to EBITDA in the 6.0x-7.0x range in 2020 and 2021 and robust near-term demand for the company's products. Wheel Pros' second-quarter results, as well as those of other auto aftermarket companies, suggest that their performances in fiscal years 2020 and 2021 could be more favorable than the expectations S&P published on March 17, 2020, despite the continued significant macroeconomic headwinds and uncertainty surrounding the timeline for the containment of the coronavirus. The unique nature of the pandemic seems to have shifted consumers' spending toward investments in their cars and homes. Although many of Wheel Pros products need to be installed at an auto shop, the pandemic has not deterred its auto enthusiast customers. S&P has revised its base-case assumptions to incorporate its stronger forecast for the company's revenue growth and margins in fiscal year 2020, which reflects a shift in its product mix toward higher-margin wheels and the suspension of the 25% tariff on Chinese imports. While S&P does not expect the company's margins to continue to benefit from these trends, Wheel Pros has already strengthened its free cash flow and improved its liquidity cushion, which it can use as a buffer if its demand erodes. In particular, the company paid down a portion of its first-lien debt and repaid its asset-based lending (ABL) revolver borrowings. S&P continues to believe the demand for highly discretionary auto parts would decline in a more protracted recession. It remains cautious about the strength of the U.S.' economic recovery and are unable to determine how much of the consumer demand for Wheel Pros' products is due to government stimulus. Furthermore, there is some risk that the company's production and distribution networks will be unable to keep up with its high demand. However, S&P believes Wheel Pros has done well to meet its demand thus far. Wheel Pros' financial-sponsor ownership will likely limit any upside to S&P's rating. The company is actively looking for acquisition targets. In 2018, Wheel Pros' liquidity tightened because it drew on its ABL revolver to fund small acquisitions. "The stable outlook reflects our view that Wheel Pros will be able to maintain sufficiently high margins and free cash flow such that its liquidity will remain adequate even if a longer-term recession decreases the customer demand for its products," S&P said. S&P could raise its rating on Wheel Pros if it sustains leverage (with a cushion) of less than 6.5x and maintains a free operating cash flow (FOCF)-to-debt ratio of at least 3%. Even if the company achieves these triggers, S&P would require it to develop a longer track record of operating at these improved levels throughout 2020 (with the expectation for similar credit metrics in 2021) before raising its rating. S&P would also have to be confident that the company's private-equity sponsor will not further increase the company's leverage for acquisitions or dividends. "We could lower our ratings on Wheel Pros if its EBITDA contracts significantly and causes its FOCF to remain negative for multiple quarters, such that it reduces the company's liquidity, or if its debt leverage worsens from current levels. This would cause us to view its financial commitments as unsustainable. This could occur if the demand for Wheel Pros' products falls significantly due to a longer and more protracted economic downturn," S&P said. WILLIAM H. THOMAS, JR: $360K Sale of Egner Property Approved ------------------------------------------------------------ Judge Jennie D. Latta of the U.S. Bankruptcy Court for the Western District of Tennessee authorized William H. Thomas, Jr.'s private sale of the real property and the personal property located at 0 Orr Road, generally known as the Egner Property and being located on 67.0214 acres more or less in Fayette County, Tennessee, to Schadt Investment Holdings, LLC for $360,105, pursuant to their Real Estate Purchase Agreement. The sale is free and clear of all interests. The Auction Motion, as to the Egner Property only, is withdrawn. The 14-day stay established by Federal Rule of Bankruptcy Procedure 6004(h) is waived. The Trustee is authorized to execute any documents necessary to effectuate the sale of the Egner Property pursuant to Federal Rule of Bankruptcy Procedure 6004(f)(1). About William H. Thomas, Jr. William H. Thomas, Jr., is a resident of Perdido Key, Florida. He is an attorney licensed to practice in the State of Tennessee and owns various real estate and business interests, including the ownership and operation of various advertising billboards and raw land. William H. Thomas, Jr., sought Chapter 11 protection (Bankr. D. Tenn. Case No. 16-27850-DSK) on June 2, 2016. [*] Bankruptcy & Commercial Lease Issues in Pandemic ---------------------------------------------------- Jonathan Koevary and Robert Gagne of Olshan Frome Wolosky LLP, wrote on Law.com a discussion on issues on commercial leases and bankruptcy in COVID-19 disrupted world. For those companies that filed for bankruptcy on the eve of the COVID-19 shutdowns, the strategies—and available cash flows to pay landlords—did not go as planned. Where feasible, companies do not file Chapter 11 petitions until after formulating both an exit strategy and plans to operate during the pendency of the bankruptcy case. For restaurateurs and retailers, this strategy will almost invariably require and depend upon cash flow for continued use of leased stores and restaurants. Planned Chapter 11 budgets must take this into account as landlords are entitled to full rent for the post-petition use of their property. To say the least, for those companies that filed for bankruptcy on the eve of the COVID-19 shutdowns, the strategies—and available cash flows to pay landlords—did not go as planned. Underlying Facts Three unrelated companies separately filed for Chapter 11 shortly before the COVID-19 pandemic shut down the country. On Feb. 17, 2020, Pier 1 Imports, Inc. (Pier 1) filed for Chapter 11 in Virginia. Pier 1 sought to pursue a going concern sale and continue its previously announced restructuring efforts, which included permanently closing hundreds of stores. On March 3, Craftworks Parent, LLC (Craftworks), the owner and franchisor of several restaurant chains, filed for Chapter 11 in Delaware. Similar to Pier 1, Craftworks planned to keep its business alive through a going concern sale resulting in a smaller footprint. On March 11, Modell's Sporting Goods, Inc. (Modell's, and Pier 1 and Craftworks, each a "debtor") filed for Chapter 11 in New Jersey. Modell's plan was to liquidate its inventory through going out of business sales in its stores. The COVID-19 crisis quickly altered the bankruptcy strategy of each of the debtors, as their plans to continue operation of their leased stores and restaurants post-filing were rendered impossible. Each debtor requested emergency court relief, which in each case included the key features that (1) the debtor would defer payment of post-petition rent to landlords and (2) the Bankruptcy Code's automatic stay provisions that prevent actions taken against a debtor—such as continuing an eviction—would be preserved, absent further relief from the bankruptcy court. Craftworks sought relief under Bankruptcy Code Section 105 (giving courts equitable powers to carry out the provisions of the Bankruptcy Code), while Pier 1 and Modell’s sought relief under both Bankruptcy Code Sections 105 and 305 (authorizing courts to suspend all proceedings). [*] Fending Off Preference Bankruptcy Claims During Pandemic ------------------------------------------------------------ Joel Cohen and Howard Magaliff of Law360 discussed ways of fending off preference bankruptcy claims at times of pandemic. We are living in unprecedented times. As we continue to see the reaction and adjustment to the great shutdown of our economy and world trade, it is important to identify and consider the interpretation of many aspects of the Bankruptcy Code post-pandemic. Companies should assess the ordinary course of business principle with regard to possible preference exposure if a customer files for bankruptcy, since what was ordinary prepandemic may no longer be so. The new normal that will emerge from the COVID-19 era demands a new approach to business, and that by definition asks the question — what does the post-pandemic ordinary course of business look like? The Ordinary Course of Business Defense Creditors need to understand the difference between two independent defenses available under the Bankruptcy Code's ordinary course of business defense. The subjective test provides that a payment is not a preference if the creditor received the payment in the ordinary course of the debtor's business based on the history and pattern of payments between the creditor and the debtor. The objective test provides that a payment is not a preference if the creditor received the payment in accordance with ordinary business terms based on standard payment practices in the industry in which the creditor and debtor do business. Historically, a creditor had to satisfy both the subjective and objective tests to successfully defend against a preference action. A 2005 amendment to the Bankruptcy Code changed that by eliminating the need to satisfy both tests. It is now possible to defeat a preference claim under either the subjective or the objective test. In determining whether a payment is made in the ordinary course of business under the subjective test, courts examine the (1) prior course of dealing between the parties; (2) amount of the payment; (3) timing of the payment; (4) circumstances of the payment; (5) presence of unusual debt collection practices; and (6) changes in the means of payment. Courts scrutinize the time period well before the preference period to establish the baseline for the course of conduct between the parties. Typically, that time period is at least one year, though it will be shorter if the relationship between the debtor and the creditor is more recent. Courts then look at the time of, amount of, and manner in which the payment occurred. Courts recognize that a creditor can exploit a debtor's financial condition through pressuring a debtor for payment. Unusual collection efforts during the preference period may remove a payment from the scope of the ordinary course of business defense. The objective test focuses on general practices in the industry, not the specifics of the transaction between the debtor and creditor. The creditor's industry is the measure for ordinariness under this test. Ordinary business terms for the objective test refers to the general practices of similar industry members. A creditor must show that the terms of the transaction in question were within the recognized boundaries of established industry practice and only dealings that significantly depart from that practice are generally held to be outside the scope of the objective test. But the test is not rigid. There is no single norm for credit transactions within an industry. The inquiry is whether a particular arrangement so differs from the industry norm that it cannot be said to have been made in the ordinary course of business. The Problem Determining whether a creditor has a viable ordinary course of business defense is often imprecise, even in normal times. The dramatic and unprecedented disruption in business activities during the COVID-19 crisis has made that determination much more difficult. Debtors who were once reliable credit risks and prompt payers now need to renegotiate payment terms or simply defer payments. Creditors, suffering from their own financial distress, are pressuring clients and customers for payment in order to avoid their own financial calamity. It is a vicious cycle affecting a vast swath of businesses in nearly all sectors of the economy. This raises an important question — does past precedent properly inform us as to what ordinary means in these trying times either between two parties or across an entire industry? Given the lag time between the filing of a bankruptcy petition and the commencement of preference recovery actions, it unlikely that there will be any judicial decisions on this subject for at least a year or more. Even then there will almost certainly be divergent opinions and it will take much longer for any type of consensus to develop. Defensive Measures for Creditors So, what can a creditor today do to minimize its exposure to a potential preference claim, understanding that the traditional methods for determining the ordinary course of business may not fully apply to payments received during the COVID-19 era? The most effective strategy is to continue to follow the best practices guidelines that applied during the pre-COVID-19 period. This means creditors should have a documented and consistently applied protocol for dealing with delinquent accounts that is communicated to clients and customers, in writing, at the outset of the relationship; and document and preserve all communications with clients and customers concerning payment issues, including written and electronic communications and notes of telephone conversations. However, creditors should not compel payment. This does not mean ceasing normal collection practices, but it does mean not making unusual threats that are inconsistent with past practice or established protocols. Assessing Ordinary in the Industry There are no bright-line criteria for evaluating industry data used in the objective test. Courts have generally opined that the creditor must only establish that the transfers in question did not deviate significantly from ordinary payment practices observed within the industry. The determination of whether payments are ordinary is informed by certain metrics pertaining to the transfers in question, and comparison to similar metrics observed among industry participants. One metric commonly relied upon with regard to payment terms within an industry is days sales outstanding, or DSO. Practitioners analyze the transfers in question by calculating the number of days between the invoice date and payment date and then comparing that measurement to industrywide DSO during the relevant time period. A second metric commonly relied upon is days payables outstanding, or DPO. Practitioners analyze the transfers in question by calculating the number of days between the invoice date and payment date and then compare that measurement to industrywide DPO during the relevant period. While these metrics may seem similar by their definition, they demonstrate two different aspects of the health of the cash flow of an organization. DSO measures how well an organization manages its cash collections, while DPO measures how well an organization pays its own operating expenses. The objective test requires the practitioner to analyze publicly available information related to industrywide payment and collection practices — measured in terms of DPO and DSO, respectively. Various research organizations frequently publish data of this nature. This information is critical to the analysis, allowing for a comparison between the DSO and DPO exhibited by the payment and the DSO and DPO ordinarily observed within the industry. Evaluating the data source is a prerequisite to appropriately applying the objective test. There are several recognized sources of industry-specific data. Industry Profiles Industrywide financial information is compiled from multiple sources and relies on the financial performance data of over 4.5 million privately held businesses. The underlying data used to generate reported industry metrics are not discretely accessible in the public domain, inhibiting the extent to which a practitioner can evaluate the resulting conclusions. Annual Statement Studies Composite financial statement data is based on more than 250,000 statements from participating institutions that represent the financials from their commercial customers and prospects. The institutions' names are removed before the data is compiled and are not available to third parties. Publicly Available Financial Data Global company information and resources for market research that facilitate fundamental analysis can be accessed through publicly available financial statement information, as reported directly from the subject company, rather than through an intermediary. We are beginning to see the severe effects on clients across industries and geographies to their respective ordinary course of business protocols. The current extended market disruption is a business environment characterized by changes to the ordinary course of business. By way of example, an international manufacturing client's U.S. subsidiary receives materials from its European affiliate. Prepandemic, payment terms were net 60, meaning that the U.S. entity had 60 days to pay its affiliate before the amount became overdue. Given the impacts of the pandemic, the European affiliate was forced to change the terms to prepayment, rather than net 60; product would not be released and shipped until payment in full was received. This change created severe consequences for the U.S. entity, as it attempted to manage its own cash flow through the same difficult times. If the U.S. entity were to file for bankruptcy and seek to recover preferential payments to its European affiliate, would the change to prepayment under the circumstances be considered ordinary, where prepandemic it would not? We would argue that as the U.S. entity continues as a going concern, the ordinary course of business with its primary supplier completely changed given the disruption caused by the pandemic. How Will the Courts Respond? In the past, trustees often chased preference recipients en masse based upon a cursory review of the debtor's books and records. If the records showed payments to vendors or other creditors within the 90-day preference period, trustees would send demand letters or sue recipients without evaluating any affirmative defenses. An amendment to the preference statute in 2019 will hopefully curtail this shoot-from-hip-and-see-what-sticks practice. The statute now requires the trustee to perform reasonable due diligence and take into account a party's known or reasonably knowable affirmative defenses before seeking recovery of a preference. This amendment has particular resonance in the COVID-19 era. A trustee's decision to sue or not sue is guided by the business judgment rule, which courts generally do not second guess. A trustee evaluating a potential preference recipient's affirmative defense of ordinary course of business now must consider what is ordinary in this environment, given some of the issues we discuss. The trustee's business judgment will necessarily be informed and shaped by issues such as (1) how an industry has been affected by the coronavirus; (2) a debtor's liquidity, source of capital and ability to make payments to vendors; (3) whether the timing of payments has been changed; and (4) whether the debtor's cash position has impacted its collection efforts and methods. For instance, if a debtor is forced to draw on a line of credit to make payments because it has no customers and no cash flow and repays the lender within the preference period, will that be considered ordinary? If a debtor previously sent checks every 45 days but now has to wire payment in 60 days, is that now ordinary? If a debtor negotiates the amount and timing of every payment to a vendor, has the ordinary course of business changed? The trustee is the gatekeeper; in the first instance, she will exercise business judgment to decide if the new normal is sufficient to establish ordinary course. What nobody can know is how sympathy or empathy may impact a trustee's choices. After all, the trustee is human. Even though a trustee could sue, should she? The trustee has the burden of proving that a preferential transfer is avoidable and the defendant has the burden of proving its defenses. Courts will be looking at preference claims after the trustee has made an initial evaluation of ordinary course defenses. Will a court infer or assume that a trustee has concluded that a defendant does not have a provable defense? Should the court even draw this conclusion? It may well turn out that bankruptcy judges will consider the ordinary course of business analysis that previously applied to now be effectively suspended because so many payments will be out of the ordinary course that disrupted payments are, at least temporarily, the new definition of ordinary. We simply will not know until some of the preference actions wind their way through the courts and result in judicial decisions. [*] Loyalty Programs Can Save Car Rental Industry ------------------------------------------------- Andrew Kunesh, writing for The Points Guy, writes that rental car companies have been hit hard by the coronavirus pandemic. Industry giant Hertz filed for Chapter 11 bankruptcy earlier in the year and Enterprise Holdings -- the parent company of Alamo, Enterprise and National -- recently laid off over 2,000 staff. It's easy to understand why. With fewer people flying, fewer are renting cars. This is especially true for business travel. Consultants are a key market for rental car companies and virtually none of them are traveling now. That said, I think rental car companies have room to grow during the pandemic. With road tripping on the rise, legacy rental car companies need to find a way to curate their business toward these customers. Likewise, these companies need to find ways to actually monetize their loyalty programs for extra income. Moreover, this will help them through the pandemic and become an important income source for years to come. Here, I'll discuss why and how loyalty programs can save the rental car industry. I’ll also provide some insight into how I’d like to see these changes be made — let’s dive in! Loyalty programs are insanely profitable Loyalty programs have been cash cows for airlines and hotels for years now. In fact, the American Airlines AAdvantage program is currently valued higher than Airbnb. On the other hand, Delta expects its cobranded credit card partnership with Amex to be worth over $7 billion by 2023. These loyalty programs are so profitable because of their partnerships. For example, every time you transfer points, spend on a cobranded credit card or shop through a shopping portal, the airline gets a check for the value of the points. This doesn't always happen in real-time, however. Just a few months ago, we learned that American Express bought $1 billion worth of Hilton Honors points upfront to help the company through the coronavirus travel downturn. Interestingly enough, none of the major rental car companies have a cobranded credit card. Likewise, none of the rental car loyalty programs partner with transferable currencies like American Express Membership Rewards or Chase Ultimate Rewards. Consequently, I think there's a market for cobranded rental car credit cards and partnerships. On the cobrand side, I’d like to see one of the major rental car companies introduce a mid-range credit card that not only earns points but provides benefits too. For example, Hertz could offer a credit card with Hertz Free-To-Go membership and elite status. This card could have a $99 annual fee, which is the cost of a Hertz Free-To-Go membership. Those who rent cars frequently can justify the cost with these added benefits. Other interesting benefits could be fee waivers (for tolls, one-way rentals, etc), free tanks of gas and access to preferred rates. These would entice me to continue renting with a single rental car company, even if it’s marginally more expensive than the competition. To sum it up, a rental car rewards card would be a win-win for everyone. Rental car companies would make money from the points they "sell" to banks and the people spending on these credit cards would have a reason to rent with the company. However, not all consumers will want to move spending to a cobranded rental car credit card. For these consumers, a partnership with a transferable points currency makes a lot of sense. I would personally take advantage of this. This would create a long-term, sustainable revenue stream for rental car companies. Customers need a reason to come back for more The major issue I've had with rental car elite status is that it's, well, not very useful. I'm a top-tier Hertz President's Circle elite member, but the limited benefits don't make me loyal to the company. Let's be real: at best, I get bonus Hertz points and a better selection of cars in the Ultimate Choice President’s Circle lot. That said, the latter benefit is hugely inconsistent — sometimes I drive off with a Chrystler 300S and other times with a Ford EcoSport. This makes rental car elite status feel like a gimmick. In turn, this leads many travelers to simply book whatever is cheapest, regardless of rental car elite status. I’ll admit that I’m in this boat (car?) too; even a $10 difference would get me to go with the cheapest available option. Rental car companies need to change their loyalty programs for the better to retain their most loyal customers. This is especially important for leisure travelers. While a large company may have a corporate partnership, leisure travelers will go with whoever offers the best price and benefits. Here's how rental car companies can revamp loyalty programs I think a good place to start is by offering truly confirmed upgrades for customers. Sure, picking from the Ultimate Choice lot or Emerald Aisle is nice. But it’s worthless if the available cars aren't a cut above what the customer actually reserved. One interesting way of rolling this out could be with virtual car selection for elite members. In a perfect world, elite members could view inventory ahead of time and digitally reserve a specific car from the lot — not being stuck with whatever is available on arrival. Alternatively, rental car companies with "pick your own car" policies could implement a choice policy. You'd have the option of either picking a car from the lot or confirming a one-class (or higher) upgrade ahead of time. This would ensure that upgrades are actually confirmed, not subject to change. I'd like to see rental car companies add other elite status benefits too. A few that come to mind include fee waivers for tolls, complimentary gas fill-ups and free car drop-off. These features are convenient and make rental car elite status feel truly premium. Rental car companies need to streamline their redemptions Finally, rental car companies need to make it easier to redeem points. Nowadays, rental car point redemptions are extremely convoluted. Hertz is a good example of this. While 750 points are technically enough for a free rental day, it’s only for very specific dates. Even worse? These dates vary by location. To make these redemptions worthwhile, rental car companies need to standardize their award charts. They can start by implementing on and off-peak dates that actually make sense and are streamlined across all locations. Sure, this makes redemptions easier and less cost-effective for the company, but it would also entice customers to earn these points. This is especially important if a rental car company rolls out a credit card or transfer partner. Bottom line In an unpredictable travel world, travel companies need to do whatever they can to entice travelers, build loyalty and plan for the future. When it comes to rental cars, these companies need to find a way to revamp their loyalty programs to be true marketing tools and moneymakers, both for now and in a post-coronavirus world. [*] One-Fifth of Department Stores Closed Down Since 2018 --------------------------------------------------------- Warren Shoulberg, writing for Forbes, reports on the collapse of the U.S. department store sector since 2018. How bad is the collapse of the department store sector over the past two years? Really bad. In numbers compiled for this Forbes.com story, new research shows that since 2018 approximately 22% of all the department stores in the country have closed or will close before the end of the year. This represents 798 individual department stores, including entire companies that have gone out of business, companies in chapter 11 bankruptcy proceedings who have announced closings and on-going retailers who have closed, or will close, selected units. Even as many retailers are closing up or going out of business no other channel has witnessed a period where more than one in five of all the stores of this type have closed in this short a period. It is unprecedented in American retailing history. The methodology on determining the percentage these stores represent in the market starts with the premise that department stores are almost always located within shopping malls. The most common number used for the total of malls in the country is about 1,200. Given that some are giant malls often with four, five or even six department store anchors but most are smaller, often with only two department stores, for purposes of this survey it is assumed that the average shopping mall contains three department stores. That means there were approximately 3,600 department stores in business in 2018 and with the documented list of 798 closings since then, it works out to just over 22% The list of closings goes from legacy brands like Sears and Penney to the regional brands that were part of the Bon Ton group to several higher-end department stores that have announced selected closings. This wave of closings has grave consequences for the shopping center business around the country. While many believe the top malls, often called “A” centers, will survive and continue to prosper, the smaller malls where the attrition has been highest are perceived as particularly vulnerable to closing all together without their anchor department stores. Many individual specialty stores located in malls have leases that require the center to have a specified number of department store anchors which have traditionally been prime traffic builders. Without these stores, entire malls could empty out, some to be repurposed as everything from office uses to distribution centers to health facilities. Still others will be bulldozed completely, the land proving more valuable than the empty building. The following is the tally of how many stores each of these retailers has closed since 2018, including announced closings that will occur through the end of 2020. It does not include any other additional closings projected beyond this year or where specific locations have not been announced. Sears: 337 Bon Ton: 256 JCPenney: 154 Macy's: 29 Nordstrom: 16 Neiman Marcus: 4 Bloomingdales: 1 [*] Recent Bankruptcy Code Amendments and Its Effects on Creditors ------------------------------------------------------------------ Jonathan Walton, Jr. of Fraser Trebilcock, wrote an article on JD Supra titled "Recent Amendments Place Creditors In A Stronger Position To Defend Against Chapter 11 Bankruptcy Preference Lawsuits." As the bankruptcy wave continues to build, more businesses are being forced to deal with bankrupt customers. It’s frustrating when a customer fails to pay an invoice and then files for bankruptcy, which results in a business collecting pennies on the dollar for its claim, if anything at all. What's worse—and which often comes as a big surprise—is when a business gets sued by the debtor or bankruptcy trustee seeking to recover payments made by the debtor before the bankruptcy. Such lawsuits, which attempt to recover "preferential payments," cost businesses time, require the expenditure of legal fees, and often result in the business paying a settlement amount to make the matter go away. With more companies filing for bankruptcy, the likelihood that businesses will face preference lawsuits is growing. Fortunately, the Bankruptcy Code provides creditors with certain defenses they can use to ward off a preference lawsuit, and Congress recently took action that strengthens those defenses. The "Small Business Reorganization Act of 2019" (SBRA), which went into effect in February, 2020, contains amendments to Chapter 11 bankruptcy preference law that are not limited to small business reorganizations. What is a Preference Lawsuit? Section 547 of the Bankruptcy Code allows a debtor or bankruptcy trustee, subject to certain defenses, to recover payments made to creditors within 90 days of the filing of the petition. The look-back period for payments is increased to one year for "insiders." The policy behind preference actions is that they prevent aggressive collection action against a debtor that might force a debtor into bankruptcy, and they also help ensure equal treatment of creditor claims. For example, if one creditor receives payment on a debt in the days leading up to a bankruptcy filing due to aggressive collection action, but another similarly situated creditor doesn't receive payment because it did not engage in collection action, then the latter would only be left with a claim in the bankruptcy. The preference provisions allow the pre-petition payments made to the aggressive creditor to be clawed back, allowing each creditor’s claim to receive equal treatment in the bankruptcy. That's how the system is supposed to work. In reality, all kinds of creditors, including those who have valid defenses to preference claims, typically get sued regardless of their defenses. Prior to the recent amendments, the Bankruptcy Code did not explicitly require debtors to conduct any due diligence as to defenses prior to filing a preference lawsuit. Historically, debtors simply sued all creditors who received payments within the 90-day period before the bankruptcy, and creditors were left to deal with such lawsuits, often filed in far-flung jurisdictions, on a one-off basis. The recent amendments to the Bankruptcy Code’s preference provisions address these issues. Amendments to Preference Provisions The SBRA created a new "subchapter V" to Chapter 11 of the Bankruptcy Code, which provides small business debtors an easier path through bankruptcy. Less discussed is the fact that the SBRA contained two amendments to preference laws that strengthen defenses against preference lawsuits in all Chapter 11 cases. Prior to the amendments, debtors had to meet a low bar to file a preference lawsuit. It was relatively easy for debtors to meet their burden of proof, and once they did the burden shifted to creditors to establish defenses. The SBRA places an additional hurdle in front of debtors. Now, a debtor or trustee must consider a creditor's statutory defenses before filing a lawsuit "based on reasonable due diligence in the circumstances of the case and taking into account a party’s known or reasonably knowable affirmative defenses…." Previously, the Bankruptcy Code stated that a debtor or trust "may" do so. Accordingly, there is now an affirmative obligation that a debtor or trustee investigate whether a creditor has a "subsequent new value", "ordinary course of business" or other defense before moving forward with a preference action. Failure to do so may result in the dismissal of a case and/or an assertion of bad faith filing. Of course, one of the questions that will be sorted out over time in the courts is what constitutes "reasonable due diligence." Another welcome change for creditors included in the SBRA relates to the venue in which preference cases may be brought. Prior to the recent changes, the Bankruptcy Code provided that preference claims under $13,650 were to be brought in the district where the defendant resides, rather than where the bankruptcy case was pending. The SBRA raises this threshold amount to $25,000. This change will have a big impact, because it lessens the likelihood of preference claims of less than $25,000 being filed at all, given the costs associated with bringing an action in a distant jurisdiction. In sum, the SBRA is good news for preference defendants. In fact, many creditors who would have otherwise been sued prior to the amendments will never become a "defendant" in the first place, given the additional obstacles debtors and trustees must overcome. [*] Turning Business Shutdowns to New Opportunities --------------------------------------------------- John Pryor of Bakersfield writes that as we transition from our nation's greatest-performing economy in history through the worst possible three-month business shutdown -- all to mitigate the spread of the coronavirus -- we are now positioned for most businesses to reopen. Yet lots of challenges remain. Large and small companies have tragically closed their doors permanently under Chapter 7 (liquidation), not Chapter 11 (reorganization) bankruptcy. Few, if any, businesses are picking up where they left off as though nothing had happened in the interim. Each and every owner and manager is confronted with the question: "What do we do now? What is our plan?" How this question is addressed will determine whether your doors can stay open or may be closed permanently. To assure a positive and profitable outcome, certain leadership tools can be helpful and can make a major difference in the outcome. No "cookie cutter" nor "one size fits all" solution will work. Yet identical leadership tools can be used to draft each of the multitude of unique plans for each unique business — plans that work! My reference to leadership tools as opposed to the more common management tools is a major, intentional shift in terminology and the overall point of this article. Most businesses do a good job of management. The management function has been defined for decades as: planning, organizing, directing and controlling. Leadership is an entirely different, yet complementary, concept. All too often, the elements of leadership are overlooked. Today, in the wake of COVID -19, every business must excel in both management and leadership to emerge successfully from this challenging health care and economic disaster. I repeat: excel in both management and leadership are essential! The differences are not difficult to understand, yet it's critical that they be clearly understood. The traditional definition of management is above. A more contemporary definition is: "A set of systems and processes designed for organizing, budgeting and problem solving to achieve planned outcomes of an organization." Of the many definitions of "leadership," my preference is one who: "Creates the mission (purpose) of an organization and its vision statement of what it will look like three to five years in the future and then works with others to accomplish both." We often hear the expression "visionary leadership" as the basis for differentiating the two terms by saying simply a leader’s view is "from 30,000 feet — plus over the horizon." A manager's view is "at ground level." Each definition has merit. However, both need to include the preference for demonstrating proactive — not reactive — action. This is an essential component. This current shutdown is an opportunity for innovation. Many are discovering new, cost-effective ways to conduct business that are to the benefit of all! Different, yet continuously improved, ways to get a job done. Examples abound, like Zoom business meetings and other communication opportunities, special opening hours for special groups (e.g., seniors), employees working from home, online employee training sessions and customer webinars with great graphics, to mention but a few. So what leadership tools — as opposed to management tools — are available? Here are some suggestions: A SWOT analysis of your organization will show you how you and your team today see your organization’s strengths, weaknesses, opportunities and threats. Your answers will assuredly be different now than they would have been a year ago, or even three months ago! Doing so helps set the stage for your use of the next leadership tool. A strategic plan is a leadership tool that includes your mission, vision and values statements, along with your long-term strategic goals to accomplish your vision. These steps are focused on what it is you want to accomplish, not how you intend to do so. An annual operational plan is a management, not leadership, tool to draft annual objectives for each long-term strategic goal. This extension of your strategic plan determines how each is to be achieved. Very importantly, each is SMART (specific, measurable, achievable, relevant and time-bound). A business continuity plan is of great value to any business that wants to hit the ground running through this overall innovative, proactive and visionary planning process. Use of these leadership tools can greatly facilitate successful resumption of operations on an innovative, proactive basis, yet do so in full compliance with old and especially new regulations. [*] Unemployment Rises But Bankruptcies Drop in NC -------------------------------------------------- Cullen Browder, writing for WRAL, reports that the coronavirus pandemic has wreaked havoc on North Carolina's economy. The state unemployment rate jumped to 12.9 percent in April as businesses were ordered closed to limit the spread of the virus. As restrictions have eased, the jobless rate fell back to 7.6 percent in June, but that is still double what it was before the pandemic. More than 800,000 people statewide have received about $6.1 billion in unemployment benefits, with about two-thirds of that coming from federal benefits that are set to expire at the end of the week. More than 1,600 North Carolina companies also obtained anywhere from $150,000 to $10 million through the federal Paycheck Protection Program – another 105,000 received lesser amounts – to keep workers on their payrolls. WRAL Investigates found that those investments have paid off on at least one front so far -- personal bankruptcies are down in North Carolina. But that safety net could soon run out. "We're seeing a big uptick in Chapter 11 filings, the corporate reorganizations," said Ciara Rogers with Campbell University's Norman Adrian Wiggins School of Law. Rogers, who studies bankruptcy trends in North Carolina, said many of those companies were already on shaky ground before the coronavirus. Big brands like GNC, Brooks Brothers and Chuck E. Cheese recently filed for bankruptcy protection. Small businesses are also feeling pinched, she said. "Some restaurants have started to file," she said. Despite the struggling economy, there hasn't been a spike in consumer bankruptcy cases yet. WRAL Investigates went through bankruptcy cases across North Carolina from mid-March, when restaurants were first shut down, to the end of June. During that time, there were 2,612 bankruptcy filings in North Carolina, compared with 3,683 during the same period last year. "A lot of that has to do with the various federal, state and local government programs that are still helping people get through," Rogers said. Those programs include the federal mortgage protection program, the Paycheck Protection Program, extended unemployment benefits and the extra $600 a week in unemployment that is set to on Saturday. Rogers predicted personal bankruptcies could explode later this year if some of those programs aren't extended. Congress continues to debate plans to extend relief. One proposal in the Senate would continue the $600-a-week aid package but reduce it based on the unemployment rate in individual states. Protection on federally backed mortgages is also set to expire in September unless lawmakers take action. Rogers said she hopes people have been smart with their money. "That [extra unemployment benefit] allowed people to hopefully plan ahead and allow them to stay afloat for a little longer than they otherwise would have been able to do," she said. "What I think we'll see toward the end of 2020 is interest rates will remain low, but credit may become more unavailable or difficult to get, and that's going to push more people into bankruptcy." With no end in sight for the pandemic, she said people need to look for financial solutions now. "Don't stick your head in the sand," she said. "Now is the time to make those tough decisions. Now is the time to see if this business model you've been using is working." ********* 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. 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