/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/201014.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, October 14, 2020, Vol. 24, No. 287 Headlines 14204 PLAT LLC: Files Chapter 7 Bankruptcy Petition 1875 N PALM CANYON: Case Summary & 7 Unsecured Creditors 220 52ND STREET: Guided Buying Adelanto Property for $1.73 Million 360 MORTGAGE: Court Narrows Claims in Suit vs Fortress Investment 800 BOURBON: Bay Bridge Has Allowed, Secured Claim in 2009 Plan AGUPLUS LLC: Taps Gus G. Tamborella as Special Counsel AMERSON INVESTMENT: Bankr. Watchdog Unable to Appoint Committee ASCENT RESOURCES: S&P Lowers ICR to 'SD' on Distressed Exchange ASHTON WOODS: S&P Alters Outlook to Positive, Affirms 'B-' ICR ASTRIA HEALTH: Seeks Court Approval to Sell Astria Regional Medical BEAZER HOMES: S&P Alters Outlook to Positive, Affirms 'B-' ICR BELLEAIR RESERVE: Feords Buying Pinellas County Property for $158K BELLEAIR RESERVE: Selling Pinellas County Property for $146K BLINK CHARGING: Settles Litigation with Former President and COO BLUESTEM BRANDS: Joint Plan Confirmed by Judge C.B. HONEYCUTT: Taps Middleswarth Bowers as Accountant C.B. HONEYCUTT: Hires Iron Horse to Conduct Asset Valuation CAMBIUM LEARNING: S&P Lowers First-Lien Debt Rating to 'B-' CARROLL COUNTY ENERGY: S&P Affirms 'BB' Rating on Term Loan CENTRIC BRANDS: Court Confirms Reorganization Plan CENTRIC BRANDS: Successfully Emerges From Chapter 11 Bankruptcy CITIUS PHARMACEUTICALS: Signs Licensing Agreement with Novellus COMCAR INDUSTRIES: Buddy Collins Buying 2 Trailer Wheels for $50 COMCAR INDUSTRIES: Juan Arellano Buying Low Value Assets for $1K COMCAR INDUSTRIES: Juan Arellano Buying Low Value Assets for $3K COMCAR INDUSTRIES: Selling 3 Great Dane Reefer Trailers for $13.5K CONSOLIDATED INFRASTRUCTURE: Unsecureds to Have 1% to 2% Recovery CORELLE BRANDS: Moody's Lowers 1st Lien Term Loan Rating to Ba3 COSMOLEDO LLC: Gets Approval to Hire CBIZ as Financial Advisor COSMOLEDO LLC: Gets Approval to Hire Mintz & Gold as Legal Counsel COTO INVESTMENTS: Case Summary & 19 Unsecured Creditors CRAVENS CONSTRUCTION: Files Chapter 7 Bankruptcy Petition DELTA SANDBLASTING: Pension Woes Prompt Chapter 11 Filing DESTINATION HOPE: U.S. Trustee Unable to Appoint Committee DG INVESTMENT 2: Moody's Affirms B3 CFR & Alters Outlook to Stable DIE TECH SERVICES: Seeks Continued Use of Cash Collateral DIGITALTOWN INC: Files for Chapter 11 Amid Dispute With Founder EAST RIDGE RETIREMENT: Fitch Assigns B- Rating on $66MM 2014 Bonds EBONY MEDIA: Bridgeman Sports-Led Auction Set EKSO BIONICS: May Sell up to $7.5M Worth of Common Stock EXIDE HOLDINGS: Buyer Atlas Objects to Bankruptcy Plan EXPO CONSTRUCTION: U.S. Trustee Unable to Appoint Committee FLOYD CHARLES YORK: Chairs Buying Oxon Piney Point for $135K FRIENDSHIP VILLAGE: Fitch Affirms BB+ on 2012/2013A/2018A Bonds FUELCELL ENERGY: Wins $8M Funding for Energy Project from DoE GENERAC POWER: Moody's Upgrades CFR to Ba1, Outlook Stable GENEVER HOLDINGS: Voluntary Chapter 11 Case Summary GG/MG INC: Sets Sale Procedures for Herculaneum Assets GLOBAL AIRCRAFT: Moody's Lowers Unsec. Notes to B1, Outlook Neg. GNC HOLDINGS: Court OKs Settlement With Creditors on Sale to Harbin GRAY TELEVISION: S&P Rates New $550MM Senior Unsecured Notes 'B+' GREAT WESTERN PETROLEUM: S&P Cuts ICR to 'CCC-'; Outlook Negative GULFPORT ENERGY: S&P Downgrades ICR to 'CCC-'; Outlook Negative HAH GROUP: S&P Assigns 'B-' Issuer Credit Rating; Outlook Stable HAJ PETROLEUM: Has Until Oct. 26 to File Plan & Disclosures HEALTH ASSET: Case Summary & 10 Unsecured Creditors HERMITAGE OFFSHORE: Lenders Get 10 PSVs, 3rd Party Gets 10 Vessels HI-CRUSH INC: Bankruptcy Court Confirms Exit Plan HI-CRUSH INC: Emerges from Chapter 11 Bankruptcy HI-CRUSH INC: Unsecureds to Get Part of Equity in Plan INTERNATIONAL ORANGE: Case Summary & 5 Unsecured Creditors INTERSTATE COMMODITIES: U.S. Trustee Appoints Creditors' Committee IT'SUGAR FL: Wins Okay of $4MM DIP Loan, Cash Collateral Use JIM'S DISPOSAL: Sets Bidding Procedures for Assets JRNA INC: Seeks Court Approval to Hire Accountant JW TRUCKING: Seeks to Use Cash Collateral Thru Dec. 31 K & W CAFETERIA: Seeks to Auction Off Restaurants K&W CAFETERIAS: Sets Bidding Procedures for Assets KEYSTONE FILLER: Taps Matteis & Company as Accountant KLAUSNER LUMBER: Hires Donlin Recano as Administrative Advisor KORN FERRY: Moody's Affirms Ba2 CFR, Outlook Remains Stable KRIEGER CRAFTSMEN: Case Summary & 20 Largest Unsecured Creditors L.S.R. INC: Unsecureds to Get Paid from Property Sale Proceeds LAKES EDGE: U.S. Trustee Unable to Appoint Committee LAKEWAY PUBLISHERS: Taps RE/MAX as Real Estate Agent LSC COMMUNICATIONS: Seeks Court Approval to Hire Appraisers MALLINCKRODT PLC: In Chapter 11 Bankruptcy Amid Opioid Suits MARINER SEAFOOD: U.S. Trustee Appoints Creditors' Committee MD AMERICA ENERGY: Files for Chapter 11 With Prepackaged Plan MD AMERICA: Case Summary & 30 Largest Unsecured Creditors MICHAEL'S GOURMET: Unsecured Creditors to Recover 2% Over 5 Years NAJEEB A. KHAN: Trustee Selling Deer Lodge Property for $212.5K NAMASTE INDIAN CUISINE: Files for Chapter 7 Bankruptcy NEUMEDICINES INC: Sets Bidding Procedures for All Assets NOBLE CORP: Gets Court OK to Solicit Bankruptcy Plan Votes NUTRACEUTICAL INT'L: Moody's Withdraws B3 CFR Upon Debt Repayment ODYSSEY ENGINES: Seeks to Use Cash Collateral OMNI SPECIALIZED: Trustee Selling Remnant Assets to Oak for $5K ONCE A DOG: Shareholder Buying Frederick Property for $1 Million OUTLOOK THERAPEUTICS: Gets Noncompliance Notice from Nasdaq PATRICK JAMES: Files for Chapter 11 Bankruptcy Protection PRESSER CONSTRUCTION: Taps Corral Vela as Litigation Counsel PURDUE PHARMA: Caplin 2nd Updated List of Govt. Entities RANDAL L. LOEHRKE: Selling Saxeville Residential Home for $82.5K REGIONAL SITE: Unsecured Creditors to Have 10% Recovery in Plan RESTAURANT 104: Case Summary & 20 Largest Unsecured Creditors REVELANT HOLDINGS: Case Summary & 20 Largest Unsecured Creditors RISEN INC: Case Summary & 2 Unsecured Creditors ROCHESTER DRUG: Merck Sharpe Says Plan Unconfirmable ROCHESTER DRUG: U.S. Trustee Objects to Plan Disclosures RSG INDUSTRIES: U.S. Trustee Unable to Appoint Committee RUBY TUESDAY: Gets Court Permission to Tap $18.5 Mil. Ch. 11 Loan SAEXPLORATION HOLDINGS: Executives Accused by SEC of $100M Fraud SEASPRAY RESORT: Seeks Court Approval to Hire Accountant SECURITY FIRST: U.S. Trustee Unable to Appoint Committee SERVICE LOGIC: Moody's Assigns B3 CFR, Outlook Stable TAILORED BRANDS: Plan Voters to Obtain Alternative Valuation TARGET DRILLING: Case Summary & 20 Largest Unsecured Creditors THAKORJI INC: Gets Approval to Hire Resource Tax as Accountant TOWN SPORTS: NY Sports Club Sale Process Approved TOWN SPORTS: U.S. Trustee Appoints Creditors' Committee TRC FARMS: Kirseys Buying Dover Property for $74.5K URSA PICEANCE: U.S. Trustee Unable to Appoint Committee UTEX INDUSTRIES: Gets Court Nod to Tap $25 Million DIP Financing UTEX INDUSTRIES: Moody's Withdraws Ca CFR on Bankruptcy Filing VALARIS PLC: Hires Alvarez & Marsal as Financial Advisor VALARIS PLC: Hires Ernst & Young to Provide Tax Services VALARIS PLC: Hires Slaughter and May as Special Counsel VALARIS PLC: Seeks to Hire Jackson Walker as Conflicts Counsel VALARIS PLC: Seeks to Hire Kirkland & Ellis as Legal Counsel VALARIS PLC: Seeks to Hire KPMG LLP as Tax Consultant VALARIS PLC: Seeks to Hire Lazard Freres as Investment Banker VIRGINIA-HIGHLAND: Case Summary & 20 Largest Unsecured Creditors WATERSIDE CONSTRUCTION: Unsecures to Be Paid 100% in 5 Years WATERTECH HOLDINGS: Payouts to Depend on Outcome of Liquidation WILSONART LLC: Moody's Affirms B2 CFR, Outlook Stable YACHT CLUB: Taps Withum+Brown to Prepare Tax Returns YKL LLC: Seeks Approval to Hire Mullin Hoard as Legal Counsel [*] Bankruptcy Filings in Hawaii Continue to Decline [*] Bankruptcy Filings in U.S. Show Surprising Decrease [*] G&S: Bankrupt Retailers Seek Extraordinary Relief in Covid ********* 14204 PLAT LLC: Files Chapter 7 Bankruptcy Petition --------------------------------------------------- 14204 Plat LLC filed for voluntary Chapter 7 bankruptcy protection (Bankr. W.D. Wash. Case No. 20-12445) on Sept. 24, 2020. According to the Seattle Business Journal, the Debtor listed an address of 14204 156th Ave. SE, Renton, and is represented in court by attorney Darrel B. Carter. 14204 Plat LLC listed assets ranging from $1,000,001 to $10,000,000 and debts ranging from $1,000,001 to $10,000,000. The filing did not identify a largest creditor. The Debtor's counsel: Darrel B Carter Cbg Law Group PLLC Tel: 425-283-0432 E-mail: darrel@cbglaw.com 1875 N PALM CANYON: Case Summary & 7 Unsecured Creditors -------------------------------------------------------- Debtor: 1875 N Palm Canyon Partners II, LLC 100 Spectrum Center Dr. Suite 530 Irvine, CA 92618 Business Description: 1875 N Palm Canyon Partners II, LLC is the owner of fee simple title to an empty ground with the skeleton of a prior budget motel located at 1875 North Palm Canyon Dr., Palm Springs, CA. An appraisal conducted by HVS Consulting & Valuation valued the Property at $20.6 million. Chapter 11 Petition Date: October 11, 2020 Court: United States Bankruptcy Court Central District of California Case No.: 20-12856 Judge: Hon. Theodor Albert Debtor's Counsel: E. Richard McGuire, Esq. SHAMROCK LEGAL 2828 Cochran St. Suite 350 Simi Valley, CA 93065 Tel: 805-478-2611 Email: richard@shamrock-legal.com Total Assets: $41,203,000 Total Liabilities: $8,393,954 The petition was signed by James Turco, managing member. A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/X7WR6ZA/1875_N_Palm_Canyon_Partners_II__cacbke-20-12856__0001.0.pdf?mcid=tGE4TAMA List of Debtor's Seven Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Baby Rhino LLC Legal Settlement $225,000 1900 N. Palm with former Canyon Dr. partners Palm Springs, CA 92262 2. Chris Rosas Loan $23,000 1900 N Palm Canyon Dr., Palm Springs, CA 92262 3. County of Riverside $102,226 4080 Lemon St., Floor 4 Riverside, CA 92501 4. Fire Recovery USA Fire Inspection $711 Fire Recovery USA, LLC c/o City of Palm Springs PO Box 548 Roseville, CA 95678 5. Gensler Invoices $45,806 4675 Macarthur Blvd., Suite 100 Newport Beach, CA 92660 6. Securitas c/o CRF Solutions $11,804 2051 Royal Ave. Simi Valley, CA 93065 7. TKD Landscape Architects $3,618 71-711 San Jacinto Dr., Suite C Rancho Mirage, CA 92270 220 52ND STREET: Guided Buying Adelanto Property for $1.73 Million ------------------------------------------------------------------ 220 52nd Street, LLC, asks authority from the U.S. Bankruptcy Court for the Eastern District of New York to sell the commercial property located at and known as 10101 Yucca Rd, Adelanto, California to Guided Investment Group, LLC for $1.725 million. A hearing on the Motion is set for Oct. 15, 2020 at 11:00 a.m. Objections, if any, must be received no later than seven days before the hearing date. In the Schedule B originally filed by the Debtor, it was disclosed that it owns the Property. The Property has a market value of $1.92 million. Pacific Premier Bank holds a duly perfected, first priority secured loan in the amount of $1,208,800. Marc S. Philips holds a second priority secured loan in the amount of $250,000. On Jan. 13, 2020, the Court entered an order granting the sale motion with DCS Holdings, LLC with respect to the Property. Due to the buyer's default, the closing did not take place. Further, on Sept. 15, 2020, the Debtor received an offer from the Buyer with the purchase price $1.725 million. The parties have entered into their Commercial Property Purchase Agreement. The Debtor, along with its counsel, has determined that the proposed purchase price constitutes fair market value based on the size and condition of the Property. Subject to the Court's approval, it asks approval to sell the Commercial Property to the Buyer on the following terms and conditions: a) Seller: 220 52nd Street, LLC b) Buyer: Guided Investment Group, LLC c) Purchase Price: $1.725 million d) Initial Deposit: $65,000 e) Balance: $1.66 million f) Purchased Property: 10101 Yucca Rd, Adelanto, CA 92301-2444 g) Closing Date: The closing date will take place at a time and place mutually agreeable to the Seller and the Buyer. The Debtor asks the Court's approval of the sale of its Real Property free and clear of all liens, claims and encumbrances to the Buyer. All of the sale proceeds will be received by the Debtor, with all liens, claims and encumbrances to attach to the proceeds. Pursuant to Section 363 (b) and (f) of the Bankruptcy Code, the Debtor asks entry of an order authorizing the sale, assignment and transfer of the Real Property. An immediate sale of the Real Property is in the best interests of creditors and the estate and will prevent unnecessary, irreparable harm to the creditor and the estate. Finally, the Debtor asks that the Court waives the 14-day stay consistent with the provisions of Bankruptcy Rule 6004(h). A copy of the Agreement is available at https://tinyurl.com/y3gnj4jk from PacerMonitor.com free of charge. About 220 52nd Street LLC 220 52nd Street, LLC, owns four real estate properties in Staten Island, New York; Adelanto, California; and Desert Hot Springs, California having a total current value of $4.76 million. 220 52nd Street, LLC, based in Staten Island, NY, filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 19-44646) on July 30, 2019. In the petition signed by Ruslan Agarunov, president, the Debtor disclosed $4,760,124 in assets and $3,705,011 in liabilities. The Hon. Elizabeth S. Stong oversees the case. Alla Kachan, Esq., at the Law Offices of Alla Kachan, P.C., serves as bankruptcy counsel to the Debtor. 360 MORTGAGE: Court Narrows Claims in Suit vs Fortress Investment ------------------------------------------------------------------ Plaintiff 360 Mortgage Group, LLC brought the action captioned 360 MORTGAGE GROUP, LLC, Plaintiff, v. FORTRESS INVESTMENT GROUP LLC, Defendant, No. 19 Civ. 8760 (LGS) (S.D.N.Y.) against Defendant Fortress Investment Group LLC alleging tortious interference with an existing contract and prospective business relations, and civil conspiracy to commit tortious interference, following the Government National Mortgage Association's ("GNMA") imposition of sanctions on 360 Mortgage. Defendant moved to dismiss the First Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Upon analysis, District Judge Lorna G. Schofield granted the motion in part and denied it in part. The Plaintiff is a privately owned mortgage bank, founded in 2007, with its principal place of business in Austin, Texas. In October 2011, the Plaintiff obtained issuer/servicer status from GNMA, a wholly-owned government association within the Department of Housing and Urban Development ("HUD"), created to facilitate mortgage lending to low-and moderate-income homebuyers. This issuer/servicer status gave the Plaintiff the ability to sell mortgage-backed securities ("MBS") backed by GNMA, and to retain the servicing rights. In late 2012, Plaintiff decided to expand its business model to focus on origination and acquisition of mortgage loans and the associated servicing rights that were eligible for pooling through GNMA and its MBS program. By 2016 and 2017, nearly 90% of Plaintiff's loan acquisitions and securitizations were through the MBS Program. Because of its enrollment in the MBS Program -- and its GNMA issuer/servicer status -- the Plaintiff was able to grow as a company and become highly profitable. While comparatively small, the Plaintiff received top tier ratings and recognition for its innovation in the mortgage industry. In 2018, Plaintiff was rated by HUD as a "tier one" servicer, the highest category rating available to a HUD approved servicer, and received a 100 out of 100 servicer rating from the Federal National Mortgage Association ("FNMA"). The Defendant is a global investment manager with approximately $42.1 billion of assets, with its principal place of business in New York, New York. In 2018, Plaintiff initiated a monetization strategy to sell a substantial portion of its assets and capitalize on the reputational value the company had accumulated. In two transactions in April and May 2018, Plaintiff sold a majority of its mortgage servicing rights to Defendant, through New Penn Financial, LLC ("New Penn"), a company that Defendant controls and manages. The Plaintiff then executed a letter of intent with a third party (the "Doe Corporation") for the sale of Plaintiff's remaining operations, production and technology through the creation of a new entity and a $300 million recapitalization. Upon Doe's initial funding of the recapitalization, the members of Plaintiff would own 25% equity in the new entity. After the parties exchanged drafts of a membership interest purchase agreement in September 2018, and agreed on virtually all of the material terms, a final agreement was to be formally executed in October 2018. On July 11, 2018, almost two months after closing the first transaction with New Penn, the FAC alleged that Chris Diamond, Defendant's Vice President, called Plaintiff's Chief Operating Officer, stating that Defendant had overpaid for servicing rights and demanding a sum of about $11 million. The Plaintiff refused. Two days later, on July 13, 2018, Mr. Diamond and Andrew Miller, the Defendant's Managing Director/Portfolio Manager, called the Plaintiff and again demanded $11 million. Mr. Miller allegedly threatened to "advise anyone and everyone in the industry" that "[Plaintiff] is not a party that can be trusted," if Plaintiff continued to refuse to pay. Three days later, on July 16, 2018, the Defendant's in-house counsel, Jonathan Grebinar, called the Plaintiff's in-house counsel and allegedly stated that, unless the Plaintiff paid $11 million, the Defendant would "destroy" Plaintiff and interfere with its relationship with GNMA; that the Defendant's owners were "billionaires" and not the type of people the Plaintiff should "piss off"; that the Defendant "intended to put [Plaintiff] out of business" if it did not accede to the Defendant's demands; and that the Defendant had a close relationship with GNMA and was meeting with GNMA the following morning. Following this series of conversations, on July 17, 2018, New Penn sent a formal letter from its legal counsel demanding that Plaintiff pay the $11 million or face litigation. On the same day, Michael Nierenberg, the Defendant's Managing Director, sent an email to Plaintiff's President stating that "[Defendant] would do whatever it took to recover the disputed money," that "[Plaintiff] should realize that [Defendant] regularly reviews its counterparties and transactions with the various governing agencies" and that "[i]t is a small world and not honoring your agreements is simply unacceptable." On July 23, 2018, New Penn filed a lawsuit against Plaintiff in New York state court, alleging breach of contract. On Oct. 9, 2018, representatives of GNMA delivered a "Notice of Violation -- Immediate Default with Negotiation" to the Plaintiff at its Texas offices. The Sanctions Notice, in effect, terminated the Plaintiff's contract with GNMA and Plaintiff's issuer/servicer status. The Plaintiff told GNMA representatives that there was likely some misunderstanding, in part, because of its near flawless audit record and that its GNMA portfolio was immaterial due to the recent transfer of mortgage servicing rights to New Penn. A GNMA representative allegedly responded that GNMA was "well aware" of the sale and transfer of servicing rights to New Penn; refused to provide substantive explanation for the Sanctions Notice or negotiate with Plaintiff; and indicated that GNMA intended to terminate its contract with Plaintiff. GNMA's stated reason for terminating the Plaintiff's contract and issuer/servicer status was that Plaintiff had three previous notices of violation -- a 2017 liquidity rounding discrepancy in one account and two more recent allegations related to the pooling and prepayment rates -- all of which the Plaintiff disputed in writing and took action to correct. The FAC alleged that the Violation Notices were a pretext resulting from the Defendant's pressuring GNMA because the Plaintiff had refused to pay the requested $11 million to the Defendant. As evidence of this pretext, the FAC identifies Chapter 23, Parts 2 and 3 of the GNMA Mortgage Backed Securities Guide (the "MBS Guide"), which elaborated on the circumstances under which GNMA is permitted to terminate an issuer's status and interest in mortgages. The FAC alleged that GNMA's application of these guidelines to the Plaintiff's three prior infractions was unprecedented and unwarranted, and constituted an "extreme deviation" from its practice in similar circumstances. After issuing the Sanctions Notice, GNMA transferred the Plaintiff's mortgage servicing portfolio to a different mortgage bank that had never achieved HUD tier one status or a GNMA audit with zero high-risk findings. Per the Sanctions Notice, the Plaintiff was required to notify all material counterparties with whom it did business of its loss of GNMA issuer status. As a result, the Plaintiff experienced severe reputational and financial harm. On Oct. 11, 2018, the Doe Corporation terminated its transaction with Plaintiff. FNMA suspended Plaintiff's "seller" approval, thereby prohibiting Plaintiff from selling loans to FNMA. The Federal Home Loan Mortgage Corporation ("Freddie Mac") also stripped the Plaintiff of its ability to sell Freddie Mac loans, while allegedly telling Plaintiff that "it had never heard of GNMA taking this kind of action," in light of the minor nature of the Violation Notices. The Plaintiff also lost its loan correspondent relationship with Wells Fargo, and business relationships with Planet Home Lending, AmeriHome, Daiwa, Fannie Mae, Customers Bank, Flagstar and the Bank of Oklahoma. On Sept. 20, 2019, Plaintiff filed the action. The FAC alleged that the Defendant tortiously interfered with Plaintiff's contractual relationship with GNMA. Defendant argued that the FAC fails to plead adequately the elements of this claim. The Court said the Defendant is incorrect. The Court explains that, under New York law, a claim of tortious interference with contract requires "[1] the existence of a valid contract between the plaintiff and a third party, [2] defendant's knowledge of that contract, [3] defendant's intentional procurement of the third-party's breach of the contract without justification, [4] actual breach of the contract, and [5] damages resulting therefrom." "Moreover, a plaintiff must allege that the contract would not have been breached `but for' the defendant's conduct." "Although on a motion to dismiss the allegations in a complaint should be construed liberally, to avoid dismissal of a tortious interference with contract claim a plaintiff must support his claim with more than mere speculation." The Defendant challenged the FAC's pleading of the third and fourth elements and causation. According to the Court, with respect to the fourth element, "[t]he Second Circuit has adopted a formalistic approach to determining whether a plaintiff has properly alleged breach of a contract in a tortious interference claim." In light of the allegations described regarding the unprecedented nature of the Sanctions Notice, the Plaintiff's plausible reading of the MBS Guide and the duty of good faith and fair dealing, the the Court denied the Defendant's motion to dismiss the tortious interference with contract claim as Plaintiff has plausibly alleged an actual breach of the contract between it and GNMA. The FAC also alleged that Defendant tortiously interfered with Plaintiff's prospective business relations with the Doe Corporation and "one or more third parties." The Defendant moved to dismiss this cause of action for failure to state a claim. The Court granted the Defendant's motion with regard to this claim. The Court said that the FAC's allegations regarding Defendant's threats -- about the small size of the mortgage bank industry, that it reviews its counterparties and transactions with various governing agencies and that it would advise other parties that Plaintiff could not be trusted -- do not allege that Defendant knew about, and intentionally interfered with, the prospective business relationships identified by Plaintiff. Accordingly, the Court dismissed the claim. A copy of the Court's Opinion and Order is available at https://bit.ly/34UITXJ from Leagle.com. About 360 Mortgage Group 360 Mortgage Group, LLC, a provider of mortgage services, sought Chapter 11 protection (Bankr. W.D. Tex. Case No. 19-11375) on Oct. 7, 2019. The Debtor was estimated to have assets of $1 million to $10 million and liabilities of the same range as of the bankruptcy filing. The Hon. Tony M. Davis is the case judge. Husch Blackwell LLP, led by Lynn H. Butler, Esq., is the Debtor's legal counsel. 800 BOURBON: Bay Bridge Has Allowed, Secured Claim in 2009 Plan --------------------------------------------------------------- In the case captioned 800 Bourbon Street, L.L.C., Appellant, v. Bay Bridge Building Limited Company, L.L.C., Appellee, No. 19-30926 (5th Cir.), 800 Bourbon Street, LLC appealed the district court's affirmance of a final judgment by the bankruptcy court in favor of Bay Bridge Building Limited Company, LLC. 800 Bourbon alleged several errors. The only one still at issue is whether the bankruptcy court erred by determining that Bay Bridge possessed an allowed, fully secured claim under the 2009 Plan. The district court affirmed on alternative grounds. Upon review, the United States Court of Appeals, Fifth Circuit affirmed the district court's judgment. In 2005, 800 Bourbon owned a building located at 800 Bourbon Street in New Orleans. The building housed a nightclub called Oz. 800 Bourbon had two members, Doyle Yeager and Johnny Chisholm. Chisholm was also the sole member of Chisholm Properties Circuit Events LLC. When Chisholm became interested in purchasing production rights to a series of parties, he sought funding for the project. For that, he turned to Julian MacQueen, the sole member of Bay Bridge. Because Chisholm and Circuit Events lacked sufficient assets to secure the loan, Chisholm and MacQueen engineered an agreement in which Bay Bridge loaned $1.2 million to 800 Bourbon, with the building serving as collateral for the loan. Chisholm used the $1.2 million to purchase the rights to the series of parties. Between May 2005 and May 2006, Bay Bridge made several additional loans to Circuit Events, with 800 Bourbon agreeing to re-pay the loaned money each time. The series of parties flopped, and Bay Bridge sought to enforce its security rights against 800 Bourbon. This prompted 800 Bourbon to file for bankruptcy protection under Chapter 11 of the Bankruptcy Code in 2008. At the center of the appeal is a proof of claim filed by Bay Bridge in the 2008 bankruptcy. Bay Bridge claimed a right to $1,360,571.01 in payments owed under the loans it made to 800 Bourbon, Chisholm, and Circuit Events. Bay Bridge designated its claim as "secured." 800 Bourbon did not dispute the secured status of the claim. In 2009, the bankruptcy court confirmed 800 Bourbon's plan of reorganization. Of note, the Plan explained that Chisholm and Circuit Events assumed 800 Bourbon's obligations to pay back Bay Bridge the money it loaned to 800 Bourbon, Chisholm, and Circuit Events. It also provided that to the extent Bay Bridge had an "allowed secured claim," 800 Bourbon's building would continue to secure the loans made by Bay Bridge, but the security would be "'in rem' only." The 2008 bankruptcy case was closed in August 2011. But the dispute between these two companies did not end then. That's because Chisholm and Circuit Events failed to pay back the money owed to Bay Bridge. So, in 2014, 800 Bourbon again sought protection from the bankruptcy court. In its second Chapter 11 filing, 800 Bourbon listed Bay Bridge as an unsecured creditor who was owed $0. Bay Bridge disagreed, and it filed a proof of claim. It again listed its claim as secured. It sought $1,979,886.47. This time around, 800 Bourbon objected to Bay Bridge's proof of claim on several grounds. It did so in the form of an adversary proceeding filed on July 21, 2015. The next day, the building was sold at auction for more than $8 million. Immediately after the sale, the bankruptcy court held a confirmation hearing. At the hearing, Bay Bridge agreed not to seek its pending claim for attorneys' fees so that 800 Bourbon's new confirmation plan would be feasible. Bay Bridge's claim was lowered to $1,649,000. This amount was placed into escrow pending the outcome of the dispute over Bay Bridge's claim to the disputed funds. In the adversary proceeding, the parties cross-moved for summary judgment. 800 Bourbon argued that Bay Bridge's security rights in the building expired when it failed to timely reinscribe its mortgage over the property. It also argued that even if Bay Bridge's security rights had not expired, the 2009 Plan itself foreclosed Bay Bridge from seeking payment from 800 Bourbon. Bay Bridge responded that its security rights in the building were valid, and, for several reasons, 800 Bourbon could not challenge what was essentially the same proof of claim that went unchallenged in the 2008 bankruptcy. On Nov. 20, 2015, the bankruptcy court granted Bay Bridge's motion and denied 800 Bourbon's. The court noted that 800 Bourbon had emphasized a provision of the 2009 Plan stating that Bay Bridge was not entitled to receive any payments from 800 Bourbon. But the court went on to put that provision of the plan in context. It explained that Bay Bridge agreed to waive 800 Bourbon's obligations under the loans to make confirmation feasible, all the while retaining an in rem security interest in the building in case Chisholm and Circuit Events did not fully pay back Bay Bridge for the loans it made in 2005 and 2006. Even so, 800 Bourbon argued that Bay Bridge only had an in rem claim in the building under the 2009 Plan "[t]o the extent" Bay Bridge had an "allowed secured claim." And, in 800 Bourbon's view, Bay Bridge did not have an "allowed secured claim" because another provision in the plan described Bay Bridge as an under-secured creditor. The bankruptcy court swiftly rejected this argument. It explained that Bay Bridge properly filed its proof of claim in the 2008 case and designated it as secured. This created prima facie evidence of the validity and amount of the claim. 800 Bourbon did not object to the claim. In fact, the 2009 Plan notes that 800 Bourbon "believe[d] the amount reflected in the Proof of Claim filed by Bay Bridge [was] correct." The court noted that the plan "provide[d] a deadline to object to claims of 60 days from the date of the confirmation order." When 800 Bourbon did not object, the claim became allowed. Accordingly, Bay Bridge had an allowed secured in rem claim. After disposing of additional issues, the court issued a judgment ordering 800 Bourbon to release the $1,649,000 to Bay Bridge. 800 Bourbon filed a motion for reconsideration. It was granted in part, and a trial date was set. 800 Bourbon's counsel then withdrew after 800 Bourbon suggested it would file a legal malpractice claim. The company's new counsel then filed a second motion for reconsideration. It was denied. The new counsel then filed a motion to designate issues for trial, which the bankruptcy court treated as a third motion for reconsideration. The matter proceeded to trial on claims not directly at issue in this appeal. Bay Bridge prevailed. 800 Bourbon then appealed to the district court. It alleged several errors. The only one still at issue is whether the bankruptcy court erred by determining that Bay Bridge possessed an allowed, fully secured claim under the 2009 Plan. The district court affirmed on alternative grounds. In its appeal, 800 Bourbon argued that both of the district court's alternative holdings are legally flawed. The district court began by rejecting 800 Bourbon's argument that the 60-day objection deadline only applied to "Disputed Claims," a category that, in 800 Bourbon's view, Bay Bridge's claim did not belong. The district court provided persuasive reasoning for its conclusion that the 2009 Plan unambiguously provided that 800 Bourbon "should have objected to Bay Bridge's claim in the immediate aftermath of the 2009 Plan." The district court also provided an alternative justification for its holding. Even assuming 800 Bourbon's contrary interpretation of the plan was reasonable, the district court's interpretation of the plan was equally reasonable. In the context of competing reasonable interpretations, the district court was entitled to defer to the bankruptcy court's interpretation of its own plan. For these reasons and others not at issue here, the district court affirmed the bankruptcy court's judgment. The Fifth Circuit held that for the reasons thoroughly explained by the district court, the bankruptcy court did not err when it held that Bay Bridge's claim was an allowed secured in rem claim under the 2009 Plan. "Because the bankruptcy court's judgment can be defended on that ground alone, we need not address 800 Bourbon's other arguments," the Fifth Circuit said. The Fifth Circuit found that the bankruptcy court did not reversibly err. The district court correctly affirmed the bankruptcy court's judgment. Accordingly, the 5th Circuit also affirmed. A copy of the Fifth Circuit's Ruling is available at https://bit.ly/3dmNXIi from Leagle.com. About 800 Bourbon Street 800 Bourbon Street LLC, based in New Orleans, Louisiana, filed a Chapter 11 petition (Bankr. E.D. La. Case No. 14-12770) on October 15, 2014. The Hon. Elizabeth W. Magner presides over the case. Christopher T. Caplinger, Esq. and Stewart F. Peck, Esq. at Lugenbuhi, Wheaton, Peck, Rankin & Hubbard served as bankruptcy counsel. In its petition, the Debtor estimated $1 million to $10 million in both assets and liabilities. The petition was signed by Bobby Warner, member. AGUPLUS LLC: Taps Gus G. Tamborella as Special Counsel ------------------------------------------------------ AguPlus, LLC received approval from the U.S. Bankruptcy Court for the District of Hawaii to employ Gus G. Tamborella, P.C. as its special counsel. Debtor needs the firm's legal assistance to pursue its claim in a case styled Hannan Ribiyou Kabushikigaisha v. Personal Representative of the Estate of Hisashi Teddy Uehara, et al. (No. 20-DCV-27240) in the District Court for the 434th Judicial District of Fort Bend County, Texas. The firm will be paid at hourly rates as follows: Gus G. Tamborella, L.C. $350 Paralegal/Legal Assistants $150 Law Clerks $75 Gus G. Tamborella is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Gus G. Tamborella, L.C. Gus G. Tamborello, P.C. 2900 Weslayan St #150 Houston, TX 77027 Phone: +1 713-659-7777 About AguPlus LLC AguPlus, LLC, a Hawaii-based company that operates ramen restaurants, and its affiliate Agu-V, Inc. filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Hawaii Lead Case No. 19-01529) on Nov. 29, 2019. In the petitions signed by Rika Takahashi, manager, AguPlus was estimated to have $500,000 to $1 million in assets and $10 million to $50 million in liabilities while Agu-V was estimated to have $500,000 to $1 million in assets and $500,000 to $1 million in liabilities. Judge Robert J. Faris oversees the case. O'Connor Playdon Guben & Inouye LLP serves as Debtor's legal counsel. AMERSON INVESTMENT: Bankr. Watchdog Unable to Appoint Committee --------------------------------------------------------------- The U.S. Bankruptcy Administrator for the Middle District of North Carolina disclosed in a filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Amerson Investment, LLC. About Amerson Investment Amerson Investment, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D.N.C. Case No. 20-10732) on Sept. 21, 2020. At the time of the filing, the Debtor had estimated assets of between $500,001 and $1 million and liabilities of between $100,001 and $500,000. Judge Benjamin A. Kahn oversees the case. Bennett Guthrie, PLLC serves as the Debtor's legal counsel. ASCENT RESOURCES: S&P Lowers ICR to 'SD' on Distressed Exchange --------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based exploration and production company Ascent Resources Utica Holdings LLC to 'SD' (selective default) from 'CC'. At the same time, S&P lowered its issue-level rating on the company's 2022 notes to 'D' from 'CC'. S&P said, "We are leaving our 'CCC+' issue-level rating on Ascent's 2026 notes on CreditWatch with positive implications, reflecting the potential for an upgrade of the company's issuer rating to 'B-' after the exchange." "Our preliminary 'B+' issue-level rating on the proposed 2025 second-lien term loan and preliminary 'B' issue-level rating on the proposed 2027 senior unsecured notes are unchanged." The downgrade follows the expiration of Ascent's debt exchange offer, whereby an aggregate principal amount of approximately $856.7 million, or 92.7% of the company's 2022 senior notes, was validly tendered. The company will exchange its outstanding senior unsecured notes due 2022 for a $538 million second-lien term loan due 2025 and new senior unsecured notes due 2027 on a pro rata basis, on the settlement date of Oct. 13, 2020. In S&P's view, the higher debt priority provided by the second-lien term loan and senior unsecured notes mix is insufficient compensation to offset the extended maturity, and therefore it views the transaction as a distressed exchange. S&P said, "The preliminary ratings on the new debt instruments and the CreditWatch positive status of the 2026 notes reflect both the likelihood that we will raise the issuer credit rating to 'B-' when we reassess the company's creditworthiness after the exchange and our recovery expectations for each debt issue. Upon the close of the transaction, we believe Ascent's debt leverage, capital structure, and maturity schedule will become sustainable and hence command a higher rating. We base our recovery expectations on the debt on an updated PV10 valuation of reserves at midyear 2020." "We expect to reassess the issuer credit rating on Ascent and assign final ratings to the new debt in six to eight weeks. Ascent's equity sponsors have agreed to launch a cash tender offer on the new 2027 notes whereby they would buy up to $60 million of the new notes, possibly at a discount. We expect the offer will be launched within 15 days of the settlement of the exchange transaction and be valid for 20 business days thereafter." ASHTON WOODS: S&P Alters Outlook to Positive, Affirms 'B-' ICR -------------------------------------------------------------- S&P Global Ratings revised its outlook to positive from stable and affirmed its 'B-' ratings on the U.S.-based homebuilder Ashton Woods USA LLC. S&P said, "Our outlook revision to positive reflects Ashton Woods' lower leverage ratios due to ongoing profit improvements. The company's inventory and overall assets have remained relatively static over the past 12-18 months in the face of solidly improved profitability. Although we expect profit growth to slow into fiscal 2021 (ends May), compared to the 2020 jump, we expect debt to EBITDA to stabilize at about 4.5x and for EBITDA to cover interest by more than 3x. Finally, our ratings, including the 'B-' issuer credit rating, continue to reflect Ashton Woods' smaller size and lower profitability than companies at the higher 'B' rating." Ashton Woods' heightened focus on entry-level buyers is the key driver of its improved credit metrics. Led by its Starlight Homes brand, with an average sales price (ASP) of about $225,000, the company has now rolled out these affordably priced homes into nearly all 12 of its markets. Not surprisingly, Starlight and its core Ashton Woods entry-level homes, are helping accelerate inventory turns and lower land-based risk. Less obvious is their benefit to overall EBITDA margins, which jumped by about 100 basis points (bps) in fiscal 2020. S&P said, "Our economists forecast a rebound in GDP in the second half as the economy recovers from the effect of the COVID-19 pandemic. We expect U.S. GDP to be down 4% for the year after rebounding from an estimated 31.7% decline in the second quarter. We expect about 29.5% growth in the third quarter and 3.5% in the fourth, supporting the basis for improving housing fundamentals going into 2021." "We assume about 1.3 million housing starts in 2020, up modestly from 1.2 million about six months ago.. After a sharp drop in orders and building in April and May, home construction resumed its pace inside of one quarter with rising prices. The entry-level segment, in particular, has been strong as steady household formation coincides with historically low interest rates. Homebuilders remained resilient by slowing land and construction spending in the second quarter as orders quickly bounced back to pre-COVID-19 levels by June, limiting the weakening of credit quality we expected for the full year." "The outlook on Ashton Woods is positive based on our forecasts that debt to EBITDA will approach 5x. Ashton Woods is rapidly increasing its presence across the entry-level segment, via the emergent Starlight Homes brand. Over the next 12 months, we expect continued strength in the brand and ongoing firmness in its traditional move-up products to maintain overall EBITDA margins of about 8%, without material further increases in debt." S&P could raise its ratings on Ashton Woods if: -- Debt to EBITDA is sustained below 5x; and -- EBITDA interest coverage remains above 2x. Steady ongoing improvements in profitability rose with little to no changes in consolidated inventory or overall debt. Absent material additional borrowings, S&P could raise the rating if the company approaches our EBITDA forecasts into its cash-flow-intensive spring selling season. S&P could revise its outlook on the company to stable if: -- Its debt to EBITDA rises toward 6x; or -- EBITDA interest coverage falls to 1.5x or below. ASTRIA HEALTH: Seeks Court Approval to Sell Astria Regional Medical ------------------------------------------------------------------- Donald W. Meyers of Yakima Herald-Republic reports that Astria Health is seeking federal bankruptcy court permission to sell Astria Regional Medical Center and its adjoining medical office building to a Yakima-based company. According to documents filed with U.S. Bankruptcy Court, Yakima MOBIC LLC will purchase the property from Astria Health in cash. Astria filed for Chapter 11 bankruptcy protection in May 2019, and shuttered the 214-bed hospital earlier this year. That left Virginia Mason Memorial as Yakima's sole hospital. The court will conduct a hearing Oct. 21 on the motion to approve the sale. Astria also owns hospitals in Toppenish and Sunnyside, which are not involved in the sale. Records with the Washington Secretary of State's office list Chris Waddle, lead developer and managing partner in Hogback Development, as Yakima MOBIC's governor, with Hogback Director of Operations Michelle Blanchard serving as the company’s registered agent. Waddle said the investor group is sponsored by Hogback, and the properties will remain associated with the health care industry. Waddle said the plan is for group to pay $8.5 million for Regional, and $11.5 million for the office building. In a letter to Astria physicians and employees, Astria CEO John Gallagher said following a nine-month nationwide search for buyers, Yakima MOBIC was "the strongest option." In court documents, Astria's attorneys said that selling the hospital and office building in a private sale was the best option for settling the company's debts, rather than putting the property on the auction block. "Critically, execution of the agreement (to sell the property) will allow the debtors to conserve crucial funds by avoiding the costs of financing an auction regarding the property," the court documents said. In March 2020, the bankruptcy court approved plans for Astria to lease the hospital to the state for non-COVID-19 patients in an effort to free up bed space for pandemic victims, but that plan was shelved when the state determined there was sufficient space in the region's hospitals. Astria Ambulatory Surgical Center, which is in the office building, will continue to operate there until a new location is found, Gallagher said in his letter. "Astria Health remains committed to the well-being of the Yakima Valley community, as we continue to pursue the next steps to exit Chapter 11 bankruptcy," Gallagher wrote. "Thank you to our committed providers, nurses and staff for your continued hard work to ensure the patients of our Valley have access to top-notch health care in a multitude of locations from Prosser to Yakima." About Astria Health Astria Health and its subsidiaries -- https://www.astria.health/ -- are a nonprofit health care system providing medical services to patients who generally reside in Yakima County and Benton County, Wash., through the operation of Sunnyside, Yakima, and Toppenish hospitals, as well as several health clinics, home health services, and other healthcare services. Collectively, they have 315 licensed beds, three active emergency rooms, and a host of medical specialties. The Debtors have 1,547 regular employees. Astria Health and 12 of its subsidiaries filed for bankruptcy protection (Bankr. E.D.Wash, Lead Case No. 19-01189) on May 6, 2019. In the petitions signed by John Gallagher, president and CEO, the Debtors were each estimated to have assets and liabilities of $100 million to $500 million. Judge Frank L. Kurtz oversees the cases. Bush Kornfeld LLP and Dentons US LLP serve as the Debtors' counsel. Kurtzman Carson Consultants, LLC is the claims and noticing agent. Gregory Garvin, acting U.S. trustee for Region 18, appointed a committee of unsecured creditors on May 24, 2019. The committee retained Sills Cummis & Gross P.C. as its legal counsel; Polsinelli PC, as co-counsel; and Berkeley Research Group, LLC as financial advisor. BEAZER HOMES: S&P Alters Outlook to Positive, Affirms 'B-' ICR -------------------------------------------------------------- S&P Global Ratings revised its outlook to positive from stable and affirmed its 'B-' ratings on U.S.-based homebuilder Beazer Homes USA Inc. The positive outlook reflects S&P's expectations that higher home deliveries will continue to support top-line growth and EBITDA, which should result in improving credit metrics that could result in a higher rating. Leverage should drop below recently elevated levels but remain in the 6x area. Leverage shot up to 7.3x at the end of the second quarter (fiscal 2020) on the company's $250 million revolver drawdown, despite the cash being added to the balance sheet, since we do not net cash against debt. However, leverage declined to slightly below 6x in the third quarter partly because of the repayment of the revolver balance. S&P anticipates leverage will remain slightly below this level through the end of fiscal 2021 (ends Sep. 2021). A quick recovery in revenue is likely. S&P said, "We expect total revenues in 2021 to improve by almost 6%, following a modest (3%) decline in fiscal 2020. This is a reversal from our 16% revenue decline we forecast in July. Indeed, we now forecast a mid-single digit (%) closing volume increase and mostly unchanged average selling prices. In addition, we are assuming 2021 EBITDA grows to about $210 million from our estimate of roughly $200 million in 2020." S&P said, "Our economists forecast a rebound in GDP in the second half of the year as the economy recovers from the effect of the COVID-19 pandemic. Our economists project U.S. GDP to be down 4% for the full year 2020 after rebounding from our estimate of a 31.7% decline in the second quarter to growing in the third and fourth quarter by about 29.5% and 3.5%, respectively, supporting the basis for improving housing fundamentals in the second half of the calendar year, where we expect GDP to grow by about 3.9%." "The homebuilding sector bounced back sharply in the second quarter and we expect that performance to continue through the end of the year. After a sharp drop in orders and building in April and May, home construction resumed its pace inside of one quarter with rising prices. The homebuilders remained resilient by slowing land spending in the second quarter as orders quickly bounced back to pre-COVID-19 levels by June, limiting the weakening of credit quality we expected for the full year." "The positive outlook reflects our expectation that revenue growth will continue due mostly to an increase in homes closed. Consequently, we expect a mid-single-digit-percent EBITDA growth rate in fiscal 2021. Thus, with modestly reduced borrowings, Beazer's debt to EBITDA should edge below 6x over the next 12 months." "We could raise our rating over the next 12 months if leverage fell and were maintained comfortably below 6x EBITDA, at which point we could take the holistic view that Beazer's credit profile was stronger than similarly rated competitors. This could occur if the recession turned out to be short-lived and foot traffic and sales returned to 2019 levels because COVID-19 was quickly controlled, consumer confidence restored, and mortgage rates remained close to today's historic lows. We would also expect Beazer to take concrete steps, such as using countercyclical free cash flow to fund its organic growth and repay debt, so as to keep leverage comfortably below 6x." "We could revise the outlook back to stable if debt to EBITDA fails to continue to improve and trends above 6x. This could occur if the housing recovery stalls and we see no top-line growth or if cost inflation is greater than expected, resulting in at least a 75-basis-point contraction in expected gross margins." BELLEAIR RESERVE: Feords Buying Pinellas County Property for $158K ------------------------------------------------------------------ Bellair Reserve Holdings, LLC, asks the U.S. Bankruptcy Court for the Middle District of Florida to authorize the sale of an unimproved parcel of real property located on Sunshine Drive in Pinellas County, Florida, more particularly described as a portion of Block 7, Gnuoy Park Subdivision as recorded in Plat Book 14, Page 60 of the Public Records of Pinellas County, Florida, to Joseph Leo Feord and Johnna Ferrens Feord for $157,650. On Aug. 31, 2020, the Debtor entered into a Contract for Purchase and Sale - 2020 to sell the Property to the Buyers for the agreed purchase price upon the terms and conditions set forth therein. The Buyers paid a deposit in the amount of $10,000 post-petition. Upon information and belief, the following creditors hold liens against the Property: (i) Bayway/Triton - $522,898 and (ii) Pinellas County Tax Collector - Unknown. The Debtor asks authority to sell the Property free and clear of liens, with all liens attaching to the proceeds of sale. It proposes to disburse 70% of the proceeds of sale to Bayway/Triton and its pro rata share of the ad valorem taxes and closing costs at closing. The Debtor will retain the remainder of the proceeds of sale. A copy of the Contract is available at https://tinyurl.com/yxl3cetp from PacerMonitor.com free of charge. About Bellair Reserve Holdings Bellair Reserve Holdings, LLC, sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 20-bk-01160) on Feb 11, 2020. In the petition signed by Torrey K. Cooper, Manager Member, the Debtor was estimated to have assets in the range of $1 million to $10 million and $500,001 to $1 million in debt. The case is assigned to Judge Catherine Peek McEwen. The Debtor tapped David W. Steen, Esq., at David W. Steen, P.A., as counsel. BELLEAIR RESERVE: Selling Pinellas County Property for $146K ------------------------------------------------------------ Bellair Reserve Holdings, LLC, asks the U.S. Bankruptcy Court for the Middle District of Florida to authorize the sale of an unimproved parcel of real property located on Sunshine Drive in Pinellas County, Florida, more particularly described as a portion of Block 7, Gnuoy Park Subdivision as recorded in Plat Book 14, Page 60 of the Public Records of Pinellas County, Florida, to John and Laurie Coticchio for $146,370. On Aug. 27, 2020, the Debtor entered into a Contract for Purchase and Sale - 2020 to sell the Property to the Buyers for the agreed purchase price upon the terms and conditions set forth therein. The Buyers paid a deposit in the amount of $3,000 post-petition. Upon information and belief, the following creditors hold liens against the Property: (i) Bayway/Triton - $522,898 and (ii) Pinellas County Tax Collector - Unknown. The Debtor asks authority to sell the Property free and clear of liens, with all liens attaching to the proceeds of sale. It proposes to disburse 70% of the proceeds of sale to Bayway/Triton and its pro rata share of the ad valorem taxes and closing costs at closing. The Debtor will retain the remainder of the proceeds of sale. A copy of the Contract is available at https://tinyurl.com/yxwerdf3 from PacerMonitor.com free of charge. About Bellair Reserve Holdings Bellair Reserve Holdings, LLC, sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 20-bk-01160) on Feb 11, 2020. In the petition signed by Torrey K. Cooper, Manager Member, the Debtor was estimated to have assets in the range of $1 million to $10 million and $500,001 to $1 million in debt. The case is assigned to Judge Catherine Peek McEwen. The Debtor tapped David W. Steen, Esq., at David W. Steen, P.A., as counsel. BLINK CHARGING: Settles Litigation with Former President and COO ---------------------------------------------------------------- Blink Charging Co. settled the litigation brought by James Christodoulou, its former president and chief operating officer, effective Oct. 9, 2020. In connection with a review arising from the settlement process, the Company determined that the termination of Mr. Christodoulou should be and has been reclassified as 'without cause.' The settlement includes compensation consistent with the reclassification. About Blink Charging Based in Miami Beach, Florida, Blink Charging Co. (OTC: CCGID) f/k/a Car Charging Group Inc. -- http://www.CarCharging.com/-- is an owner/operator of electric vehicle ("EV") charging stations in the United States and a growing presence in Europe, Asia, Israel, the Caribbean, and South America. The Blink Network utilizes proprietary cloud-based software that operates, maintains, and tracks the EV charging stations connected to the network, along with the associated charging data. The Company has established key strategic partnerships to roll out adoption across numerous location types, including parking facilities, multifamily residences and condos, workplace locations, health care/medical facilities, schools and universities, airports, auto dealers, hotels, mixed-use municipal locations, parks and recreation areas, religious institutions, restaurants, retailers, stadiums, supermarkets, and transportation hubs. Marcum LLP, in New York, the Company's auditor since 2014, issued a "going concern" qualification in its report dated April 2, 2020 citing that the Company has a significant working capital deficiency, has incurred significant losses, and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. BLUESTEM BRANDS: Joint Plan Confirmed by Judge ---------------------------------------------- Judge Mary F. Walrath has entered findings of fact, conclusions of law and order confirming the Joint Chapter 11 Plan of Bluestem Brands, Inc., and affiliates. The Debtors have proposed the Plan in good faith and not by any means forbidden by law. In determining that the Plan has been proposed in good faith, the Court has examined the totality of the circumstances surrounding the filing of the Chapter 11 Cases, the Plan itself, and the process leading to its formulation. The Plan was proposed with the legitimate and honest purpose of maximizing the value of the Debtors’ Estates and to effectuate a successful chapter 11 proceeding for the Debtors. The Plan was the product of extensive negotiations conducted at arm’s length among the Debtors and certain of their key stakeholders including, but not limited to, the Committee. The Plan's classification, settlement, exculpation, release, discharge, and injunction provisions have been negotiated in good faith and at arm’s length, are consistent with sections 105, 1122, 1123(b)(6), 1125(e), 1129, 1141, and 1142 of the Bankruptcy Code, and are each necessary for the Debtors to consummate a value-maximizing conclusion to the Chapter 11 Cases. Accordingly, the requirements of section 1129(a)(3) of the Bankruptcy Code are satisfied. A full-text copy of the order dated August 21, 2020, is available at https://tinyurl.com/y2rwhkzs from PacerMonitor at no charge. About Bluestem Brands Bluestem Brands, Inc. and its affiliates are a direct-to-consumer retailer that offers fashion, home, and entertainment merchandise through internet, direct mail, and telephonic channels under the Orchard and Northstar brand portfolios. Headquartered in Eden Prairie, Minnesota, the Debtors employ approximately 2,200 individuals and own and/or lease warehouses, distribution centers, and call centers in 10 other states, including New Jersey, Massachusetts, Georgia, and California. The Debtors' supply chain consists of name-brand vendors -- e.g., Michael Kors, Samsung, Keurig, Dyson -- as well as private label and non-branded sources based in the United States and abroad. For more information, visit https://www.bluestem.com/ Bluestem Brands, Inc., based in Eden Prairie, MN, and its affiliates sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10566) on March 9, 2020. In its petition, Bluestem Brands was estimated to have $500 million to $1 billion in both assets and liabilities. The petition was signed by Neil P. Ayotte, executive vice president, general counsel and secretary. The Hon. Mary F. Walrath oversees the case. The Debtors tapped YOUNG CONAWAY STARGATT & TAYLOR, LLP, and KIRKLAND & ELLIS LLP, KIRKLAND & ELLIS INTERNATIONAL LLP as counsels; FTI CONSULTING, INC., as financial advisor; RAYMOND JAMES & ASSOCIATES, INC., as investment banker; IMPERIAL CAPITAL LLC, as restructuring advisor; and PRIME CLERK LLC as claims and noticing agent. C.B. HONEYCUTT: Taps Middleswarth Bowers as Accountant ------------------------------------------------------- C.B. Honeycutt Grading, Inc. received approval from the U.S. Bankruptcy Court for the Western District of North Carolina to employ Middleswarth, Bowers & Co as its accountant. Middleswarth will provide bookkeeping services and other services related to Debtor's Chapter 11 case. The firm will be paid at hourly rates as follows: Senior Partner $285 Associate C.P.A. $225 Staff accountants $150 Bookkeeper $85 The firm's services will be provided mainly by Michael Bowers who will be paid at the rate of $225 per hour. Mr. Bower and other employees of the firm do not have connections with the Debtor, creditors or any other "party in interest," according to court filings. The firm can be reached through: Michael T. Bowers, MBA Middleswarth, Bowers & Co 219 A Wilmot Drive Gastonia, NC 28054 About C.B. Honeycutt C.B. Honeycutt Grading, Inc. specializes in turn-key site development for subdivisions, retail stores, apartments, and schools. Visit https://hgisiteworks.com for more information. On July 3, 2020, C.B. Honeycutt Grading sought Chapter 11 protection (Bankr. W.D.N.C. Case No. 20-30658). Debtor was estimated to have $1 million to $10 million in assets as of the bankruptcy filing. Judge J. Craig Whitley oversees the case. John C. Woodman, Esq., at Essex Richards, P.A., is Debtor's legal counsel. C.B. HONEYCUTT: Hires Iron Horse to Conduct Asset Valuation ----------------------------------------------------------- C.B. Honeycutt Grading, Inc. received approval from the U.S. Bankruptcy Court for the Western District of North Carolina to employ Iron Horse Auction Company, Inc. to conduct a valuation of its assets. The firm's services will be provided mainly by William B. Lilly, Jr. who will be paid at the rate of $250 per hour. Mr. Lilly and other employees of Iron Horse do not have connections with the Debtor, creditors or any other "party in interest," according to court filings. The firm can be reached through: William B. Lilly, Jr. Iron Horse Auction Company, Inc. 174 Airport Rd. Rockingham, NC 28379 Phone: +1 910-997-2248 About C.B. Honeycutt C.B. Honeycutt Grading, Inc. specializes in turn-key site development for subdivisions, retail stores, apartments, and schools. Visit https://hgisiteworks.com for more information. On July 3, 2020, C.B. Honeycutt Grading sought Chapter 11 protection (Bankr. W.D.N.C. Case No. 20-30658). Debtor was estimated to have $1 million to $10 million in assets as of the bankruptcy filing. Judge J. Craig Whitley oversees the case. John C. Woodman, Esq., at Essex Richards, P.A., is Debtor's legal counsel. CAMBIUM LEARNING: S&P Lowers First-Lien Debt Rating to 'B-' ----------------------------------------------------------- S&P Global Ratings revised its recovery rating to '3' from '2' on Dallas-based Cambium Learning Group Inc.'s first-lien debt (term loan and revolving credit facility). The '3' recovery rating indicates S&P's expectation of meaningful (50%-70%; rounded estimate: 65%) recovery for lenders in the event of a payment default. S&P said, "At the same time, we lowered our rating on the first-lien debt to 'B-' from 'B' in accordance with our notching criteria for a '3' recovery rating. We also affirmed our ratings on the second-lien debt. All of our other ratings on Cambium are unchanged." "The rating actions reflect our view of Cambium's plan to increase the amount of its first-lien term loan issued in connection with the Rosetta Stone acquisition by $25 million to $450 million. Total debt issued in connection with this acquisition will remain the same, with the incremental second-lien term loan decreasing by $25 million to $125 million." ISSUE RATINGS - RECOVERY ANALYSIS Key analytical factors -- S&P's simulated default scenario analysis on Cambium contemplates a default in 2022 as the company faces strong price competition from large traditional publishers and operational product failures, leading to severe attrition among school district customers. -- S&P has valued the company on a going concern basis using a 6x multiple of its projected emergence EBITDA. -- The valuation multiple is similar to that of other companies operating in the educational technology software industry. Simulated default assumptions -- Simulated year of default: 2022 -- EBITDA at emergence: $138 million -- EBITDA multiple: 6x -- LIBOR at default: 2.5% Simplified waterfall -- Net enterprise value (after 5% administrative costs): $785 million -- Valuation split in % (obligors/nonobligors): 100/0 -- Value available to first-lien debt claims: $785 million -- Secured first-lien debt claims: $1.15 billion -- Recovery expectations: 50%-70%; rounded estimate: 65% -- Value available to second-lien debt claims: $0 -- Secured second-lien debt claims: $367 million -- Recovery expectations: 0%-10%; rounded estimate: 0% CARROLL COUNTY ENERGY: S&P Affirms 'BB' Rating on Term Loan ----------------------------------------------------------- S&P Global Ratings affirmed its 'BB' rating on Carroll County Energy LLC's (CCE) term loan and credit facility. On Oct. 8, 2020, CCE upsized its existing term loan B by an additional $25 million bringing the current balance outstanding to $434 million. CCE has also executed interest rate hedges on the term loan to better manage interest expense over the life of the loan. CCE did not make any amendments to their existing $60 million revolver or their $10 million working capital facility due 2026. CCE plans to use the proceeds to pay a one-time distribution to equity holders and transaction-related fees and expenses. S&P said, "As a result of the increased debt balance, our forecasted minimum DSCR is now about 1.9x, which is lower than our previous expectation of 2.0x. The DSCR is somewhat impacted by future cash flow sweeps slightly shifting because of the $25 million in incremental debt, as well as marginally lower forward price assumptions compared with earlier in 2020. In our opinion, the marginally lower credit metrics do not indicate a fundamental shift in CCE's credit quality. We also do not anticipate the additional $25 million of debt to have any long-term impact on the project's performance." "CCE has been operating since December 2017 and has a track record of stable operational performance with high availability and capacity factors. We continue to forecast that CCE will realize spark spreads in the in the high-single digit $/MWh range in 2020 and potentially into 2021." "We expect RTO prices of $100/MW-day in the 2022/2023 and 2023/2024 capacity auctions and $120/MW-day escalated at 2% in all future periods. These assumptions are unchanged from our prior expectations." In the first half of 2020, CCE's performance benefitted from realized hedge gains of approximately $14 million in the period, which included a positive inflow of about $2.3 million from the project's revenue put. CCE paid approximately $12.5 million in cash flow sweeps and about $2.3 million in mandatory amortization as of June 30, 2020. Despite forecasted near-term market weakness, S&P anticipates that CCE will pay down the term loan by a total of $20 million-$25 million with excess cash in 2020. S&P will continue to monitor market developments and the project's performance during the year. S&P said, "The stable outlook reflects our expectation that CCE will be able to generate sufficient cash flow to maintain an average DSCR of about 2.4x, with a capacity factor in the 85% to 90% range and a heat rate of 6,700 Btu/Kwh to 6,900 Btu/Kwh over the next five years. We also expect the project's minimum DSCR to be about 1.9x in 2021 and forecast a cash sweep between $18 million and $20 million over the next 12 months." "We could lower the rating if the project cannot maintain a minimum DSCR of 1.5x on a consistent basis or if realized cash sweeps are far lower than expectations. This could occur if realized spark spreads compress on the back of sluggish power demand in the PJM region. We could also revise the outlook or lower the ratings if the project experiences significant operational difficulties that stymie cash flow available for debt service." "While unlikely in the near term, we could raise the ratings if we expect the project to maintain a minimum base case DSCR, greater than 2.5x in all years, including the post-refinancing period. We would expect such outcomes to materialize only via significant improvement in spark spreads and uncleared capacity prices in PJM's AEP zone and if the project can continue to procure inexpensive fuel." CENTRIC BRANDS: Court Confirms Reorganization Plan -------------------------------------------------- Judge Sean H. Lane has entered an order confirming the Fifth Amended Joint Chapter 11 Plan of Reorganization of Centric Brands Inc. and its Debtor affiliates pursuant to Chapter 11 of the Bankruptcy Code. Each Holder of an Impaired Claim or Interest either has accepted the Plan or will receive or retain under the Plan, on account of such Claim or Interest, property of a value, as of the Effective Date, that is not less than the amount that such Holder would receive or retain if the Debtors were liquidated under chapter 7 of the Bankruptcy Code on such date. Classes 1 and 2 are unimpaired by the Plan pursuant to section 1124 of the Bankruptcy Code and, accordingly, Holders of Claims in such Classes are conclusively presumed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code. Classes 3, 4, 5, and 6 are Impaired by the Plan. All Voting Subclasses for Classes 3 and 4 at each Debtor have voted to accept the Plan. All Class 6 Voting Subclasses voted to accept the Plan other than the Class 6 Voting Subclass at Centric Denim USA, LLC (the "Class 6 Rejecting Subclass"). No Holders of Claims in Class 5 submitted votes and Class 5 is therefore presumed to accept the Plan. Classes 8 and 9 are deemed umpaired or unimpaired by the Plan pursuant to section 1124 of the Bankruptcy Code and, accordingly, Holders of Claims in Classes 8 and 9 are conclusively presumed to have accepted the Plan pursuant to Section 1126(f) of the Bankruptcy Code or are conclusively deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code. Holders of Claims in Classes 7 and 10 (if any) will not receive or retain any property on account of their Claims and, accordingly, such Claims are Impaired and such Holders are conclusively deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code (Classes 7 and 10 together with the Class 6 Rejecting Subclass, the "Rejecting Classes"). Accordingly, the Plan satisfies the requirements of section 1129(a)(8) of the Bankruptcy Code as to all Debtors. Claims in Classes 3, 4, 5, and 6 are Impaired and entitled to vote under the Plan. As established by the Voting Certification: (a) all Voting Subclasses for Classes 3 and 4 at each Debtor have voted to accept the Plan; (b) all Class 6 Voting Subclasses voted to accept the Plan other than the Class 6 Voting Subclass at Centric Denim USA, LLC; and (c) no Holders of Claims in Class 5 submitted votes. Class 5 is therefore presumed to accept the Plan. Accordingly, the Plan satisfies section 1129(a)(10) of the Bankruptcy Code. Fifth Amended Plan Centric Brands Inc., et al.'s Fifth Amended Joint Chapter 11 Plan of Reorganization provides: * Class 3 First Lien Term Loan Claims. This class is impaired. The First Lien Term Loan Claims shall be Allowed in the aggregate principal amount equal to $635,065,853.90. Each Holder of a First Lien Term Loan Claim, in each case without duplication among the Debtors, shall receive (i) the face amount of its Allowed First Lien Term Loan Claim in indebtedness under the Exit First Lien Term Loan Facility; and (ii) its Pro Rata share of thirty percent (30%) of the Reorganized Centric Equity Interests, subject to dilution by the Management Incentive Plan (if any). * Class 4 Second Lien Secured Claims. This class is impaired. The Second Lien Loan Claims shall be Allowed in the aggregate principal amount equal to $724,240,770.19. Each Holder of a Second Lien Secured Claim, in each case without duplication among the Debtors, shall receive, its Pro Rata share of seventy percent (70%) of the Reorganized Centric Equity Interests, subject to dilution by the Management Incentive Plan (if any). * Class 5 Hudson Notes Claims. This class is impaired. Each Holder of an Allowed Hudson Notes Claim shall receive its Pro Rata share of the Claims Cash Pool, determined by the amount of Allowed Hudson Notes Claims divided by the amount of Allowed Hudson Notes Claims plus the amount of Allowed General Unsecured Claims other than the Second Lien Deficiency Claims and 2024 Convertible Notes Claims, as the Second Lien Lenders and the Holders of the 2024 Convertible Notes Claims will be deemed to have waived their rights to receive any recovery on account of the Second Lien Deficiency Claim and 2024 Convertible Notes Claims. * Class 6 General Unsecured Claims. This class is impaired. Each Holder of an Allowed General Unsecured Claim other than a Second Lien Deficiency Claim or 2024 Convertible Notes Claim shall receive its Pro Rata share of the Claims Cash Pool, determined by the amount of General Unsecured Claims divided by the amount of Allowed Hudson Notes Claims plus the amount of Allowed General Unsecured Claims other than the Second Lien Deficiency Claims or 2024 Convertible Notes Claims, as the Second Lien Lenders and the Holders of the 2024 Convertible Notes Claims will be deemed to have waived their rights to receive any recovery on account of the Second Lien Deficiency Claim and the 2024 Convertible Notes Claims, respectively. * Class 7 Subordination Claims. This class is impaired. Subordination Claims will be canceled, released, discharged, and extinguished as of the Effective Date, and will be of no further force or effect, and Holders of Subordination Claims will not receive any distribution on account of such Subordination Claims. * Class 8 Intercompany Claims. This class is unimpaired/impaired. Intercompany Claims shall be, at the election of the applicable Debtor(s), with the consent of the Required Consenting Creditors, or the Reorganized Debtor(s), as applicable, either: (i) Reinstated; or (ii) canceled and released without any distribution on account of such Claims. * Class 9 Intercompany Interests. This class is unimpaired/impaired. Intercompany Interests shall be, at the election of the applicable Debtor(s), with the consent of the Required Consenting Creditors, or the Reorganized Debtor(s), as applicable, either: (i) Reinstated; or (ii) canceled and released without any distribution on account of such Claims. * Class 10 Centric Interests. This class is impaired. On the Effective Date, all Centric Interests shall be canceled without any distribution on account of such Interests. The Reorganized Debtors shall fund distributions under the Plan with (a) Cash on hand; (b) the issuance and distribution of Reorganized Centric Equity Interests; (c) proceeds from the Exit First Lien Revolving Loan Facility; (d) proceeds from the Exit Securitization Facility; (e) proceeds from the Exit First Lien Term Loan Facility; and (f) the Tengram Payment. A full-text copy of the Fifth Amended Joint Chapter 11 Plan of Reorganization dated September 21, 2020, is available at https://tinyurl.com/y4hbojhc from PacerMonitor.com at no charge. Counsel to the Debtors: Gregg M. Galardi Cristine Pirro Schwarzman Daniel G. Egan Emily Kehoe Ropes & Gray LLP 1211 Avenue of the Americas New York, New York 10036-8704 Telephone: (212) 596-9000 Facsimile: (212) 596-9090 * * * Law360 reports that a New York bankruptcy judge on September 17, 2020, approved Centric Brand's $700 million Chapter 11 plan after hearing the licensing company had struck a nearly $6 million deal to end objections and legal claims from its unsecured creditors. At a virtual hearing, U. S. Bankruptcy Judge Sean Lane approved the plan after hearing counsel for Centric describe the settlement, including $900,000 added to the unsecured creditor's pot late Wednesday afternoon. "We now have a global deal with respect to all the issues," Centric counsel Gregg Galardi said. About Centric Brands Centric Brands Inc. designs, produces, merchandises, manages and markets kidswear, accessories, and men's and women's apparel under owned, licensed and private label brands. Currently, the company and its affiliates license over 100 brands, including AllSaints, BCBG, Buffalo, Calvin Klein, Disney, Frye, Herve Leger, Jessica Simpson, Joe's, Kate Spade, Kenneth Cole, Marvel, Michael Kors, Nautica, Nickelodeon, Spyder, Timberland, Tommy Hilfiger, Under Armour, and Warner Brothers. The companies sell licensed products through both retail and wholesale channels. Centric Brands and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-22637) on May 18, 2020. As of March 31, 2020, Debtors disclosed $1,855,722,808 in total assets and $2,014,385,923 in total liabilities. Judge Sean H. Lane oversees the cases. The Debtors tapped Ropes & Gray, LLP as bankruptcy counsel; PJT Partners, Inc. as investment banker; Alvarez & Marsal, LLC as financial advisor; and Prime Clerk, LLC as notice, claims and balloting agent. CENTRIC BRANDS: Successfully Emerges From Chapter 11 Bankruptcy --------------------------------------------------------------- Centric Brands LLC, a leading lifestyle brands collective, announced Oct. 12, 2020 that it has completed its financial restructuring and emerged from voluntary Chapter 11 proceedings, implementing the Company's Plan of Reorganization (the "Plan") that was approved by the United States Bankruptcy Court for the Southern District of New York. In accordance with the Company's Restructuring Support Agreement ("RSA"), Centric Brands has substantially reduced its funded indebtedness by approximately $700 million and has emerged with a stronger capital structure. The Company is well-capitalized with access to substantial cash and liquidity. Centric Brands is now a private entity with a strategic plan to continue harnessing growth opportunities in its core business segments while identifying new areas for future success in partnership with Blackstone ("Blackstone"), its majority sponsor, Ares Management Corporation ("Ares"), and HPS Investment Partners ("HPS"). "The completion of this reorganization marks a major milestone for our Company. Throughout this process, we operated seamlessly without interruption and remained focused on serving our valued partners. We maintained excellent relationships with licensors and our supply chain – and ultimately delivered to our retailers. We now emerge with an optimized business structure, supportive partners, a qualified and engaged Board, and strengthened financials. We look forward to maximizing our potential and creating opportunities for future growth. We wouldn’t be here today without our valued employees and trusted business partners, for whom I am truly appreciative," said Mr. Jason Rabin, CEO of Centric Brands. Rabin continued: "While the impact of COVID-19 has been challenging for our industry, we are very well positioned to navigate the current environment. We will continue leading the industry in our core segments, including kids, accessories, and men's and women's denim and lifestyle. With Blackstone's support, an improved capital structure, strategic relationships, and industry expertise – we are built for a strong future ahead." Additional Information As part of the restructuring, funds managed by Blackstone and its affiliates exchanged existing second lien debt for controlling equity interests in the reorganized company. Previous senior lenders, funds managed by Ares and HPS, have retained their senior loan positions and received equity interests in the reorganized company. The Company has also secured exit financing in the form of a new securitization facility from Sound Point Capital Management, LP, as well as new revolving and term loan facilities from its current secured lenders, providing additional liquidity for the Company's go-forward operations and strategic objectives. About Centric Brands Centric Brands Inc. designs, produces, merchandises, manages and markets kids wear, accessories, and men's and women's apparel under owned, licensed and private label brands. Currently, the company and its affiliates license over 100 brands, including AllSaints, BCBG, Buffalo, Calvin Klein, Disney, Frye, Herve Leger, Jessica Simpson, Joe's, Kate Spade, Kenneth Cole, Marvel, Michael Kors, Nautica, Nickelodeon, Spyder, Timberland, Tommy Hilfiger, Under Armour, and Warner Brothers. The companies sell licensed products through both retail and wholesale channels. Centric Brands and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 20-22637) on May 18, 2020. As of March 31, 2020, Debtors disclosed $1,855,722,808 in total assets and $2,014,385,923 in total liabilities. Judge Sean H. Lane oversees the cases. The Debtors tapped Ropes & Gray, LLP as bankruptcy counsel; PJT Partners, Inc. as investment banker; Alvarez & Marsal, LLC as financial advisor; and Prime Clerk, LLC as notice, claims and balloting agent. The Official Committee of Unsecured Creditors appointed to these Chapter 11 cases tapped McDermott Will & Emery LLP as its counsel and Berkeley Research Group, LLC as its financial advisor. CITIUS PHARMACEUTICALS: Signs Licensing Agreement with Novellus --------------------------------------------------------------- Citius Pharmaceuticals, Inc. has signed an exclusive agreement with Novellus Therapeutics Limited to license iPSC-derived mesenchymal stem cells (iMSCs), and has created a new subsidiary, NoveCite, that will be focused on developing cellular therapies. NoveCite has a worldwide exclusive license from Novellus, an engineered cellular medicines company, to develop and commercialize NoveCite mesenchymal stem cells to treat acute respiratory conditions with a near term focus on Acute Respiratory Distress Syndrome associated with COVID-19. Several cell therapy companies using donor-derived MSC therapies in treating ARDS have demonstrated that MSCs reduce inflammation, enhance clearance of pathogens and stimulate tissue repair in the lungs. Almost all these positive results are from early clinical trials or under the emergency authorization program. NC-iMSCs are the next generation mesenchymal stem cell therapy. They are believed to be differentiated and superior to donor-derived MSCs. Human donor-derived MSCs are sourced from human bone marrow, adipose tissue, placenta, umbilical tissue, etc. and have significant challenges (e.g., variable donor and tissue sources, limited supply, low potency, inefficient and expensive manufacturing). iMSCs overcome these challenges because they: * Are more potent and secrete exponentially higher levels of immunomodulatory proteins; * Have practically unlimited supply for high doses and repeat doses; * Are from a single donor and clonal so they are economically produced at scale with consistent quality and potency, as well as being footprint free (compared to viral reprogramming methods); and, * Have significantly higher expansion capability. Globally, there are 3 million cases of ARDS every year out of which approximately 200,000 cases are in the United States. The COVID-19 pandemic has added significantly to the number of ARDS cases. Once the COVID patients advance to ARDS, they are put on mechanical ventilators. Death rate among patients on ventilators can be as high as 50% depending on associated co-morbidities. There are no approved treatments for ARDS, and the current standard of care only attempts to provide symptomatic relief. "NoveCite iMSCs have the potential to be a breakthrough in the field of cellular therapy for acute respiratory conditions because of the high potency seen in Novellus' pre-clinical studies, and because iMSCs are iPSC-derived, and therefore overcome the manufacturing challenges associated with donor derived cells," said Myron Holubiak, chief executive officer of Citius. "We are excited to be part of this effort because of the promise to save lives and reduce long term sequelae in patients with devastating respiratory diseases such as ARDS caused by COVID-19," said Dr. Matthew Angel, chief science officer of Novellus. "Our iMSC technology has multimodal immunomodulatory mechanisms of action that make it potentially promising therapy to treat acute respiratory diseases." About Citius Headquartered in Cranford, NJ, Citius Pharmaceuticals, Inc. -- http://www.citiuspharma.com/-- is a specialty pharmaceutical company dedicated to the development and commercialization of critical care products targeting unmet needs with a focus on anti-infectives, cancer care and unique prescription products. Citius reported a net loss of $15.56 million for the year ended Sept. 30, 2019, a net loss of $12.54 million for the year ended Sept. 30, 2018, and a net loss of $10.38 million for the year ended Sept. 30, 2017. As of June 30, 2020, Citius had $38.40 million in total assets, $9.66 million in total liabilities, and $28.74 million in total stockholders' equity. Wolf & Company, P.C., in Boston, Massachusetts, the Company's auditor since 2014, issued a "going concern" qualification in its report dated Dec. 16, 2019, citing that the Company has suffered recurring losses and negative cash flows from operations and has a significant accumulated deficit. These conditions raise substantial doubt about the Company's ability to continue as a going concern. COMCAR INDUSTRIES: Buddy Collins Buying 2 Trailer Wheels for $50 ---------------------------------------------------------------- Comcar Industries, Inc., and its affiliated debtors filed with the U.S. Bankruptcy Court for the District of Delaware a notice of their proposed sale of two trailer wheels, as set forth in the Bill of Sale (Exhibit A), to Buddy Collins for $50, free and clear of all Liens. On Sept. 2, 2020, the Court entered the Order, which, among other things, established the De Minimis Asset Sale Procedures. Pursuant to the De Minimis Asset Sale Procedures, the Debtors submit the De Minimis Sale Notice in connection with their sale of the trailer wheels to the Purchaser. The total selling price for the Sale to the Purchaser is for $50, which is under the limit set forth in the De Minimis Asset Sale Procedures. The Sale does not include payments to be made by the Debtors on account of commission fees to agents, brokers or auctioneers. The Debtors intend to use the proceeds from the Sale to fund the administration of these chapter 11 cases and, if applicable, to distribute funds in accordance with the priority scheme set forth in orders of the Court, their financing documents and/or the Bankruptcy Code. The Purchaser is not an insider of the Debtors. The Objection Deadline is Oct. 16, 2020 at 4:00 p.m. (ET). If no objection to the De Minimis Sale Notice is timely filed and served in accordance with it and the De Minimis Asset Sale procedures, the Debtors may consummate the sale without further notice. Copies of all filings in the Debtors' chapter 11 cases are available for free on the website of the Court-appointed claims and noticing agent in these chapter 11 cases, Donlin Recano & Co., Inc., at https://www.donlinrecano.com/Comcar. A copy of the Exhibit A is available at https://tinyurl.com/yy8ow2do from PacerMonitor.com free of charge. About Comcar Industries Comcar Industries is a transportation and logistics company headquartered in Auburndale, Fla., with over 40 strategically-located terminal and satellite locations across the United States. For more information, visit https://comcar.com/ On May 17, 2020, Comcar Industries and related entities sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11120). In the petitions signed by CRO Andrew Hinkelman, Comcar Industries was estimated to have $50 million to $100 million in assets and liabilities as of the bankruptcy filing. The Hon. Laurie Selber Silverstein is the presiding judge. The Debtors tapped DLA Piper LLP (US) as counsel; FTI Consulting, Inc., as financial advisor; and Bluejay Advisors, LLC as investment banker. Donlin Recano & Company, Inc., is the claims agent. COMCAR INDUSTRIES: Juan Arellano Buying Low Value Assets for $1K ---------------------------------------------------------------- Comcar Industries, Inc. and its affiliated debtors filed with the U.S. Bankruptcy Court for the District of Delaware a notice of their proposed sale of certain low value assets, as set forth in the Bill of Sale (Exhibit A), to Juan Arellano for $1,000, free and clear of all Liens. On Sept. 2, 2020, the Court entered the Order, which, among other things, established the De Minimis Asset Sale Procedures. Pursuant to the De Minimis Asset Sale Procedures, the Debtors submit the De Minimis Sale Notice in connection with their sale of the low value assets to the Purchaser. The total selling price for the Sale to the Purchaser is $1,000, which is under the limit set forth in the De Minimis Asset Sale Procedures. The Sale does not include payments to be made by the Debtors on account of commission fees to agents, brokers or auctioneers. The Debtors intend to use the proceeds from the Sale to fund the administration of these chapter 11 cases and, if applicable, to distribute funds in accordance with the priority scheme set forth in orders of the Court, their financing documents and/or the Bankruptcy Code. The Purchaser is not an insider of the Debtors. The Objection Deadline is Oct. 16, 2020 at 4:00 p.m. (ET). If no objection to the De Minimis Sale Notice is timely filed and served in accordance with it and the De Minimis Asset Sale procedures, the Debtors may consummate the sale without further notice. Copies of all filings in the Debtors' chapter 11 cases are available for free on the website of the Court-appointed claims and noticing agent in these chapter 11 cases, Donlin Recano & Company, Inc., at https://www.donlinrecano.com/Comcar. A copy of the Exhibit A is available at https://tinyurl.com/y44qarna from PacerMonitor.com free of charge. About Comcar Industries Comcar Industries is a transportation and logistics company headquartered in Auburndale, Fla., with over 40 strategically-located terminal and satellite locations across the United States. For more information, visit https://comcar.com/ On May 17, 2020, Comcar Industries and related entities sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11120). In the petitions signed by CRO Andrew Hinkelman, Comcar Industries was estimated to have $50 million to $100 million in assets and liabilities as of the bankruptcy filing. The Hon. Laurie Selber Silverstein is the presiding judge. The Debtors tapped DLA Piper LLP (US) as counsel; FTI Consulting, Inc., as financial advisor; and Bluejay Advisors, LLC as investment banker. Donlin Recano & Company, Inc., is the claims agent. COMCAR INDUSTRIES: Juan Arellano Buying Low Value Assets for $3K ---------------------------------------------------------------- Comcar Industries, Inc. and its affiliated debtors filed with the U.S. Bankruptcy Court for the District of Delaware a notice of their proposed sale of certain low value assets, as set forth in the Bill of Sale (Exhibit A), to Juan Arellano for $3,000, free and clear of all Liens. On Sept. 2, 2020, the Court entered the Order, which, among other things, established the De Minimis Asset Sale Procedures. Pursuant to the De Minimis Asset Sale Procedures, the Debtors submit the De Minimis Sale Notice in connection with their sale of the low value assets to the Purchaser. The total selling price for the Sale to the Purchaser is $3,000, which is under the limit set forth in the De Minimis Asset Sale Procedures. The Sale does not include payments to be made by the Debtors on account of commission fees to agents, brokers or auctioneers. The Debtors intend to use the proceeds from the Sale to fund the administration of these chapter 11 cases and, if applicable, to distribute funds in accordance with the priority scheme set forth in orders of the Court, their financing documents and/or the Bankruptcy Code. The Purchaser is not an insider of the Debtors. The Objection Deadline is Oct. 16, 2020 at 4:00 p.m. (ET). If no objection to the De Minimis Sale Notice is timely filed and served in accordance with it and the De Minimis Asset Sale procedures, the Debtors may consummate the sale without further notice. Copies of all filings in the Debtors' chapter 11 cases are available for free on the website of the Court-appointed claims and noticing agent in these chapter 11 cases, Donlin Recano & Company, Inc., at https://www.donlinrecano.com/Comcar. A copy of the Exhibit A is available at https://tinyurl.com/y47zrpov from PacerMonitor.com free of charge. About Comcar Industries Comcar Industries is a transportation and logistics company headquartered in Auburndale, Fla., with over 40 strategically-located terminal and satellite locations across the United States. For more information, visit https://comcar.com/ On May 17, 2020, Comcar Industries and related entities sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11120). In the petitions signed by CRO Andrew Hinkelman, Comcar Industries was estimated to have $50 million to $100 million in assets and liabilities as of the bankruptcy filing. The Hon. Laurie Selber Silverstein is the presiding judge. The Debtors tapped DLA Piper LLP (US) as counsel; FTI Consulting, Inc., as financial advisor; and Bluejay Advisors, LLC as investment banker. Donlin Recano & Company, Inc., is the claims agent. COMCAR INDUSTRIES: Selling 3 Great Dane Reefer Trailers for $13.5K ------------------------------------------------------------------ Comcar Industries, Inc. and its affiliated debtors filed with the U.S. Bankruptcy Court for the District of Delaware a notice of their proposed sale of three 2006 Great Dane 7011 TZ-1A reefer trailers, as set forth in the Bill of Sale (Exhibit A), to C&D Logistics for $13,500 ($4,500 each), free and clear of all Liens. On Sept. 2, 2020, the Court entered the Order, which, among other things, established the De Minimis Asset Sale Procedures. Pursuant to the De Minimis Asset Sale Procedures, the Debtors submit the De Minimis Sale Notice in connection with their sale of the Reefer Trailers to the Purchaser. The total selling price for the Sale to the Purchaser is for $13,500, which is under the limit set forth in the De Minimis Asset Sale Procedures. The Sale does not include payments to be made by the Debtors on account of commission fees to agents, brokers or auctioneers. The Debtors intend to use the proceeds from the Sale to fund the administration of these chapter 11 cases and, if applicable, to distribute funds in accordance with the priority scheme set forth in orders of the Court, their financing documents and/or the Bankruptcy Code. The Purchaser is not an insider of the Debtors. The Objection Deadline is Oct. 16, 2020 at 4:00 p.m. (ET). If no objection to the De Minimis Sale Notice is timely filed and served in accordance with it and the De Minimis Asset Sale procedures, the Debtors may consummate the sale without further notice. Copies of all filings in the Debtors' chapter 11 cases are available for free on the website of the Court-appointed claims and noticing agent in these chapter 11 cases, Donlin Recano & Co., Inc., at https://www.donlinrecano.com/Comcar. A copy of the Exhibit A is available at https://tinyurl.com/y5os8jqq from PacerMonitor.com free of charge. About Comcar Industries Comcar Industries is a transportation and logistics company headquartered in Auburndale, Fla., with over 40 strategically-located terminal and satellite locations across the United States. For more information, visit https://comcar.com/ On May 17, 2020, Comcar Industries and related entities sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11120). In the petitions signed by CRO Andrew Hinkelman, Comcar Industries was estimated to have $50 million to $100 million in assets and liabilities as of the bankruptcy filing. The Hon. Laurie Selber Silverstein is the presiding judge. The Debtors tapped DLA Piper LLP (US) as counsel; FTI Consulting, Inc., as financial advisor; and Bluejay Advisors, LLC as investment banker. Donlin Recano & Company, Inc. is the claims agent. CONSOLIDATED INFRASTRUCTURE: Unsecureds to Have 1% to 2% Recovery ----------------------------------------------------------------- Consolidated Infrastructure Group Inc. filed with the U.S. Bankruptcy Court for the District of Delaware a Combined Disclosure Statement and Chapter 11 Plan of Liquidation dated August 21, 2020. The Combined Plan and Disclosure Statement constitutes a liquidating chapter 11 plan for the Debtor and provides for the Distribution of the Debtor's assets already liquidated or to be liquidated over time to the Holders of Allowed Claims in accordance with the terms of the Combined Plan and Disclosure Statement and the priority of claims provisions of the Bankruptcy Code. On the Effective Date or as soon thereafter as is reasonably practical, or on the date such Claim becomes an Allowed General Unsecured Claim or as soon thereafter as is reasonably practical, each Holder of an Allowed General Unsecured Claim in Class 3 shall receive its Pro Rata share of the Class 3 Distribution. Holders of Allowed General Unsecured Claim have an estimated recovery of 1% to 2%. On the Effective Date, all Equity Interests shall be cancelled and released without any distribution or retention of any property on account of such Equity Interests; provided, however, that as of the Effective Date, the Plan Administrator shall be deemed to own one share of stock in CIG; provided, further, that the Plan Administrator shall not be entitled to receive any distribution on account of such retained Equity Interest. Allowed Claims and any amounts necessary to wind down the Debtor’s Estate shall be paid from Cash held by the Debtor as of the Effective Date, and Cash proceeds obtained after the Effective Date, if any, from all sources, including the liquidation and collection of the Debtor's remaining assets. A full-text copy of the Combined Disclosure Statement and Plan dated August 21, 2020, is available at https://tinyurl.com/y4fa4n5j from PacerMonitor.com at no charge. Counsel to the Debtor: RICHARDS, LAYTON & FINGER, P.A. Daniel J. DeFranceschi (No. 2732) Paul N. Heath (No. 3704) Zachary I. Shapiro (No. 5103) Brett M. Haywood (No. 6166) Megan E. Kenney (No. 6426) One Rodney Square 920 North King Street Wilmington, Delaware 19801 About Consolidated Infrastructure Created in 2016 and headquartered in Omaha, Nebraska, Consolidated Infrastructure Group, Inc., provides underground utility and damage prevention services to support others that do underground construction and maintenance. By providing detailed information on what lies beneath the surface, CIG's damage prevention services help protect communities from damage that could otherwise occur when utilities, other companies, or individuals dig underground. CIG sought Chapter 11 protection (Bankr. D. Del. Case No. 19-10165) on Jan. 30, 2019. The Debtor disclosed $11.6 million in assets and $9 million in liabilities as of Jan. 30, 2019. Judge Brendan Linehan Shannon oversees the case. The Debtor tapped Richards, Layton & Finger, P.A., as legal counsel; Gavin/Solmonese LLC as financial advisor and investment banker; and Omni Management Group as claims and noticing agent. CORELLE BRANDS: Moody's Lowers 1st Lien Term Loan Rating to Ba3 --------------------------------------------------------------- Moody's Investors Service affirmed Corelle Brands Holdings Inc.'s Ba3 Corporate Family Rating (CFR) and its Ba3-PD Probability of Default Rating (PDR). At the same time, Moody's downgraded the company's senior secured first lien term loan due 2024 to Ba3 from Ba2. The outlook remains stable. The ratings actions follow Corelle Brands' refinancing of its existing Corelle Brands $150 million and Instant Brands CAD $90 million asset-based lending revolving (ABL) facilities (both unrated) with a new $250 million ABL facility due 2025 (unrated). In addition, the company will repay the remaining $75 million outstanding balance on its senior secured bridge term loan due 2021 (unrated) using cash on hand. The ratings affirmation reflects that the transaction reduces Corelle Brands' financial leverage and addresses near term maturities. Moody's estimates the company's debt/EBITDA leverage at around 2.4x, pro forma for the transaction as of the last twelve months period (LTM) ending July 5, 2020, compared to 3.0x as of fiscal year end December 31, 2019. The reduction in financial leverage provides cushion within the company's rating to absorb further variation around operating results or a modest shareholder distribution given its private equity ownership. The downgrade of the company's existing senior secured first lien term loan due 2024 is the result of the lower amount of subordinated debt in the capital structure because of the reduction of the unsecured seller notes due 2024 (unrated) to $100 million from $243 million, providing less loss absorption to the first lien debt under Moody's loss given default model. The following ratings/assessments are affected by The action: Ratings Downgraded: Issuer: Corelle Brands Holdings Inc. Senior Secured 1st Lien Term Loan B, Downgraded to Ba3 (LGD3) from Ba2 (LGD2) Ratings Affirmed: Issuer: Corelle Brands Holdings Inc. Corporate Family Rating, Affirmed at Ba3 Probability of Default Rating, Affirmed at Ba3-PD Outlook Actions: Issuer: Corelle Brands Holdings Inc. Outlook, Remains Stable RATINGS RATIONALE Corelle Brands' Ba3 CFR broadly reflects the company's relatively modest revenue scale with annual revenue of around $1.0 billion, and its high degree of operational risks relative to the rated consumer durable universe. The legacy Corelle Brand's business operates in the cyclical and mature housewares category, and it's highly reliant on a single, specialized manufacturing facility for its namesake brand. An extended supply chain disruption from situations such as the coronavirus would adversely affect the company's revenue and EBITDA. During the coronavirus outbreak the company has seen heightened demand for product. The Company has focused on inventory management to drive cashflows after entering the year with high Instant Brands Inventory. On Corelle Brands there is an expected partial impact on sales due to the temporary closure of its production facilities in New York and Malaysia that were not deemed essential. These factors will drive short term revenue and earnings headwind in Q4, which will raise leverage slightly. Governance factors considers the company's ownership by a private equity sponsor, which increases the risks of shareholder friendly financial policies, however this is currently mitigated by the company's moderate financial leverage. The rating is broadly supported by the company's moderate credit metrics highlighted by debt/EBITDA leverage that Moody's estimates at around 2.4x as of the last twelve months period (LTM) ending July 5, 2020, pro forma for the ABL refinancing transaction. The rating also reflects the company's well-recognized portfolio of housewares and small kitchen appliance brands, global footprint, and good diversification of its distribution channels. Moody's expects continued good consumer demand for kitchen electrics and housewares, because of ongoing stay at home and social distancing due to the coronavirus, will support top line growth in the high single digits, resulting in positive free cash flow in the $45-$55 million range over the next 12-18 months. Corelle Brands has good liquidity supported by Moody's expectation for positive free cash flows on an annual basis, access to the new $250 million ABL due 2025 ($25 million drawn at close), and lack of near-term maturities until its existing first lien term loan expires in 2024. Environmental, Social and Governance considerations The coronavirus outbreak, the government measures put in place to contain it, and the weak global economic outlook continue to disrupt economies and credit markets across sectors and regions. Moody's analysis has considered the effect on the performance of consumer durables from the current weak US economic activity and a gradual recovery for the coming months. Although an economic recovery is underway, it is tenuous and its continuation will be closely tied to containment of the virus. As a result, the degree of uncertainty around its forecasts is unusually high. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. Social risk factors also consider the company is exposed to changes in consumer discretionary spending power and shifts in consumer spending trends such as food at-home and away from home. Corelle Brands is moderately exposed to environmental risks. The company uses chemicals and other raw materials as part of its glass manufacturing process and is subject to various regulations regarding emissions, managing plant waste, solid waste disposal and remediation of contaminated sites. Although Corelle Brands is in compliance with the applicable environmental laws, a failure to adhere to these regulations could result in financial penalties and remediation costs. The company is exposed to challenges related to sourcing because the company's Instant Brands segment sources almost of its products from suppliers located outside the US, primarily China. An extended supply chain disruption from situations such as the coronavirus would adversely affect the company's revenue and EBITDA. Governance considerations include Corelle Brands' ownership by private equity sponsor Cornell Capital, which risks of shareholder friendly financial policies. However, Moody's expects the company will continue to have relatively balanced financial policies evidenced by maintaining moderately conservative credit metrics. In addition, the company funded the Instant Brands acquisition mostly with equity, which supports a more conservative leverage profile than typical private equity owned firms. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects Moody's expectation that the company will generate positive free cash flow, and that credit metrics will remain moderate with debt/EBITDA leverage at around 3.0x over the next 12-18 months. Moody's also anticipates the company will maintain good liquidity and relatively conservative financial policies. The ratings could be upgraded if the company grows its size and scale while sustaining debt/EBITDA below 2.5x and EBIT/interest above 4.5x. Also, the company would be expected maintain at least good liquidity. Alternatively, the ratings could be downgraded if debt/EBITDA is sustained above 3.5x, if liquidity weakens following free cash flow failing to materialize as anticipated or the ABLs are drawn more than expected. Also, declining sales including for the Instant Pot, or if the company's financial strategies become more aggressive, including undertaking a large debt-financed acquisition or dividend distribution, could also lead to a downgrade. The principal methodology used in these ratings was Consumer Durables Industry published in April 2017. Headquartered in Rosemont, IL, Corelle Brands Holdings Inc. ("Corelle Brands") manufactures, designs and markets dinnerware, bakeware, kitchen tools, range-top cookware, storage and cutlery products. In March 2019, the company acquired Instant Brands, manufacturer of the Instant Pot line of products. Following the acquisition, the company's most notable brands include Corelle, Pyrex, Corningware, OLFA, Snapware, Visions, Chicago Cutlery, and Instant Pot. The company markets its products primarily in the US, Canada, and Asia-Pacific region and sells into several channels including mass merchants, department stores, specialty retailers and the Internet, among others. Corelle Brands was acquired by Cornell Capital in May 2017. Annual revenue is around $1.0 billion. COSMOLEDO LLC: Gets Approval to Hire CBIZ as Financial Advisor -------------------------------------------------------------- Cosmoledo, LLC and affiliates received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire CBIZ Accounting, Tax and Advisory of New York, LLC as their financial advisor. CBIZ will provide the following services: a. identify and facilitate the Debtors' restructuring options and assist in exploring strategic alternatives; b. participate in discussions and presentations for the Debtors' stakeholders and board of directors and other parties; c. assist in the preparation of materials to be presented to the independent members of the board of directors where applicable; d. assist the Debtors in the preparation of short and long-term projections (balance sheet, profit and loss, and cashflows); e. assist the Debtors in the preparation of financial-related disclosures required by the bankruptcy court; f. assist the Debtors in instituting procedures to ensure the safekeeping and security of the Debtors' assets; g. assist the Debtors in negotiating with landlords; h. assist the Debtors in resolving vendor issues; i. assist the Debtors with information and analyses required pursuant to their cash collateral arrangements; j. assist the Debtors in the preparation of financial statements; k. provide accounting and financial advisory services; l. assist the Debtors in daily administrative and operational duties; m. prepare and validate a 13-week cash flow projection; and n. render such other general consulting services as the Debtors or their legal counsel may deem necessary. The firm's hourly rates are as follows: Managing Directors $695 - $800 Directors $445 - $550 Senior Managers and Managers $335 - $445 Senior Associates and Staff $195 - $335 CBIZ received a $95,000 pre-bankruptcy retainer from the Debtors. John Sordillo, managing director at CBIZ, 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 Sordillo, CPA CBIZ Accounting, Tax & Advisory of NY LLC 1065 Avenue of the Americas, 11th Floor New York, NY 10018 Phone: 212-790-5700 About Cosmoledo LLC Cosmoledo, LLC and affiliates own and operate 16 fine casual bakery cafes in New York City under the trade name "Maison Kayser." Maison Kayser, a global brand, is an authentic artisanal French boulangerie that has been doing business in New York since 2012. For more information, visit https://maison-kayser-usa.com/ Cosmoledo, LLC, and its affiliates, including Breadroll, LLC, sought Chapter 11 protection (Bankr. S.D.N.Y Lead Case No. 20-12117) on Sept. 10, 2020. In the petitions signed by CEO Jose Alcalay, Debtors were estimated to have assets in the range of $10 million to $50 million, and $50 million to $100 million in debt. The Debtors have tapped Mintz & Gold LLP as their bankruptcy counsel, and CBIZ Accounting, Tax and Advisory of New York LLC as their financial advisor, accountant and consultant. Donlin Recano & Co., Inc. -- https://www.donlinrecano.com/Clients/mk/Index -- is the claims agent. COSMOLEDO LLC: Gets Approval to Hire Mintz & Gold as Legal Counsel ------------------------------------------------------------------ Cosmoledo, LLC and affiliates received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Mintz & Gold LLP as their legal counsel. The services Mintz & Gold will provide are as follows: a. advise the Debtors with respect to their powers and duties and the continued management of their property and affairs; b. negotiate an asset purchase agreement to form the basis of a sale process pursuant to Section 363 of the Bankruptcy Code and seek approval of a sale to successful bidder procured as a result of such process; c. negotiate with creditors of the Debtors and work out a plan of liquidation and take the necessary legal steps in order to effectuate such a plan; d. prepare legal papers; e. appear before the bankruptcy court; f. attend meetings and negotiate with representatives of creditors and other parties; g. advise the Debtors in connection with any potential post-petition financing or refinancing of secured debt; h. take any necessary action to obtain approval of a disclosure statement and confirmation of a plan of liquidation; and i. perform all other legal services. Mintz & Gold's 2020 hourly rates are as follows: Partners $425 - $850 Associates $220 - $460 Paraprofessionals $50 - 100 Mintz & Gold received a $298,000 pre-bankruptcy retainer. Mintz & Gold is a "disinterested person" as defined in Bankruptcy Code Section 101(14), according to court filings. The firm can be reached through: Andrew R. Gottesman, Esq. Maria E. Garcia, Esq. Gabriel Altman, Esq. Mintz & Gold LLP 600 Third Avenue, 25th Fl. New York, NY 10016 Tel: (212) 696-4848 Fax: (212) 696-1231 Email: gottesman@mintzandgold.com garcia@mintzandgold.com altman@mintzandgold.com About Cosmoledo LLC Cosmoledo, LLC and affiliates own and operate 16 fine casual bakery cafes in New York City under the trade name "Maison Kayser." Maison Kayser, a global brand, is an authentic artisanal French boulangerie that has been doing business in New York since 2012. For more information, visit https://maison-kayser-usa.com/ Cosmoledo, LLC, and its affiliates, including Breadroll, LLC, sought Chapter 11 protection (Bankr. S.D.N.Y Lead Case No. 20-12117) on Sept. 10, 2020. In the petitions signed by CEO Jose Alcalay, Debtors were estimated to have assets in the range of $10 million to $50 million, and $50 million to $100 million in debt. The Debtors have tapped Mintz & Gold LLP as their bankruptcy counsel, and CBIZ Accounting, Tax and Advisory of New York LLC as their financial advisor, accountant and consultant. Donlin Recano & Co., Inc. -- https://www.donlinrecano.com/Clients/mk/Index -- is the claims agent. COTO INVESTMENTS: Case Summary & 19 Unsecured Creditors ------------------------------------------------------- Debtor: Coto Investments, Inc. DBA O'Cairns Inn & Suites - Best Western 940 East Ocean Ave Lompoc, CA 93436 Business Description: Coto Investments, Inc. is a privately held company in the traveler accommodation industry. It owns and operates O'Cairns Inn & Suites, a family-style boutique hotel with hospitality and resort-like amenities. Chapter 11 Petition Date: October 13, 2020 Court: United States Bankruptcy Court Central District of California Case No.: 20-11239 Judge: Hon. Deborah J. Saltzman Debtor's Counsel: Robert P. Goe, Esq. GOE FORSYTHE & HODGES LLP 18101 Von Karman Avenue Suite 1200 Irvine, CA 92612-7127 Tel: (949) 798-2460 Email: rgoe@goeforlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Tory O'Cairns, chief executive officer. A copy of the petition containing, among other items, a list of the Debtor's 19 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/IQTL5HY/Coto_Investments_Inc__cacbke-20-11239__0001.0.pdf?mcid=tGE4TAMA CRAVENS CONSTRUCTION: Files Chapter 7 Bankruptcy Petition --------------------------------------------------------- Cravens Construction LLC filed for voluntary Chapter 7 bankruptcy protection (Bankr. M.D. Tenn. Case No. 20-04329) on Sept. 25, 2020. According to the Nashville Business Journal, the Debtor listed an address of 822 Jack Saunders Rd., Waverly. Cravens Construction listed assets up to $81,500 and debt up to $55,471. The filing's largest creditor was listed as RG Electrical Contractors LLC with an outstanding claim of $30,000. The Debtor's counsel: LEFKOVITZ AND LEFKOVITZ, PLLC Steven Lefkovitz Tel: 615-256-8300 E-mail: slefkovitz@lefkovitz.com Cravens Construction LLC is a general contractor in Paso Robles, California. DELTA SANDBLASTING: Pension Woes Prompt Chapter 11 Filing --------------------------------------------------------- Brian Rinker of San Francisco Business Times reports that Delta Sandblasting Co, a Petaluma company that sandblasts and paints large marine vessels, filed for Chapter 11 bankruptcy protection in the second week of October 2020 after an appeals court upheld a ruling that it owed its union's pension fund $1.8 million. Delta Sandblasting Co. has roughly $300,000 in the bank and is seeking bankruptcy protection to use its available cash to pay its 24 employees and cover other operational expenses as it negotiates an agreement with the union that will allow the company to stay in business, according to the Chapter 11 court documents. "Delta also plans to move to terminate any of its obligations under a collective bargaining agreement with the Union unless it is able to reach an agreement with the Union that will allow it to remain in business," according to a court document written by Delta President Robert Sanders. "Delta will then make payments to its creditors out of ongoing operations." The long-running dispute between Delta and the Auto, Marine & Specialty Painters union originated when the labor group determined its pension fund was underfunded and increased employer contributions. Over the years, the contributions rose from $1.95 in 2007 to $9.78 by 2015. But the simmering dispute came to head in March 2016 when the rate ballooned to $11.38 per hour. Delta abruptly lowered the monthly pension rate it contributed down to $1.95, telling the union if couldn't afford to make higher payments anymore. The National Labor Relations Board ruled in favor of the union, determining that Delta engaged in unfair labor practice when it cut the pension contribution without notifying the union. Delta had previously agreed to the rate increase as part of a collective bargaining agreement in 2014, but argued in court that the rise in pension contributions was not explicitly written into the agreement. Delta appealed to the Ninth Circuit Court of Appeals and in a 2-1 ruling in August the court upheld the labor board's decision. Delta plans to petition the court for a rehearing. Delta is a family-owned business that sandblasts, hydroblasts and paints large marine vessels in Bay Area shipyards. It was founded by James Robert Sanders and incorporated in 1991. Sanders's son Robert Sanders manages the day-to-day operations as president and his wife handles the company's finances. According to court documents, the work is high risk and involves hazardous materials. In recent years the company has expanded from marine work to other types of industrial steel preservation. The weekly payroll is more than $35,000, not including the increased pension rate, and total assets for the company roughly $958,000, according to the court documents. Delta also received a $352,555.00 Paycheck Protection Program loan from the government. The company reported a third quarter net loss of $32,767. In all, the company has nearly $2.2 million in liabilities, court documents show. Here's a video of a Delta worker blasting the rubber deck coatings on a Golden Gate Ferry commuter vessel with high-pressure water at 35,000 psi. About Delta Sandblasting Delta Sandblasting Company, Inc. -- http://www.deltasandblasting.com/-- specializes in steel preparation and coating, including but not limited to many types marine and industrial projects. Delta Sandblasting Company sought Chapter 11 protection (Bankr. N.D. Cal. Case No. 20-10546) on Oct. 6, 2020. The Hon. Roger L. Efremsky is the case judge. FINESTONE HAYES LLP, led by Stephen D. Finestone, Esq., is the Debtors' counsel. The Debtor disclosed $1,457,180 in assets and $2,170,870 in liabilities. DESTINATION HOPE: 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 Destination Hope, Inc., according to court dockets. About Destination Hope Inc. Based in Fort Lauderdale, Fla., Destination Hope, Inc. offers comprehensive drug rehab and mental health programs, with a special focus on dual diagnosis while providing clients with the knowledge and tools to overcome their addiction. Visit https://destinationhope.com for more information. Destination Hope sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-19402) on Aug. 28, 2020. The petition was signed by Benjamin Brafman, the company's president. At the time of the filing, Debtor had estimated assets of between $500,000 and $1 million and liabilities of between $10 million and $50 million. Judge Peter D. Russin oversees the case. Wernick Law, PLLC is Debtor's legal counsel. DG INVESTMENT 2: Moody's Affirms B3 CFR & Alters Outlook to Stable ------------------------------------------------------------------ Moody's Investors Service affirmed DG Investment Intermediate Holdings 2, Inc.'s credit ratings, including a B3 corporate family rating ("CFR"), a B3-PD probability of default rating, and respective B2 and Caa2 instrument ratings on the security-systems integrator's first- and second-lien credit facilities. However, given the anticipated strength of the company's performance through 2020 in the face of the COVID-19 epidemic, Moody's has revised Convergint's outlook to stable, from negative. Affirmations: Issuer: DG Investment Intermediate Holdings 2, Inc. ("Convergint") Probability of default rating, affirmed B3-PD Corporate family rating, affirmed B3 $814 million senior secured first-lien term loan maturing 2025, affirmed B2 (LGD3) $75 million senior secured first-lien revolving credit facility, expiring 2023, affirmed B2 (LGD3) $186 million senior secured second-lien bank credit facility maturing 2026, affirmed Caa2 (LGD5) Outlook action Outlook, changed to stable, from negative RATINGS RATIONALE The outlook change to stable, from negative, takes into account only minimally reduced demand for Convergint's commercial security systems, even in the face of the COVID-19 pandemic, enabling the company to continue to deleverage and improve its liquidity. Instead of the revenue shortfall Moody's had expected at the start of the pandemic, Moody's anticipates mid-single-digit-percentage revenue growth in 2020, while leverage will fall below 6.5 times, as compared with close to 7.0 times at year-end 2019. By taking advantage of a highly variable cost structure and focusing on the DSO cash conversion cycle, the company will maintain profitability and generate free cash flows that are strong for its B3 CFR. Convergint's operating model has proven unexpectedly resilient through 2020. Although it has had to delay work at some client sites because of quarantine restrictions, other end-markets such as government and education have experienced accelerated demand as those customers seek to take advantage of empty facilities. Most of Convergint's installation projects continue as planned, as its services are deemed mission critical for many customers. Ratings are supported by Convergint's strong market presence in the design, installation, and contractual service and maintenance of electronic and physical commercial security systems, with ancillary capabilities in fire alarm/notification and life safety. Even against the backdrop of a possibly strong resurgence in COVID cases through the end of 2020, Moody's expects demand for the integration of security systems to remain relatively robust, as commercial reliance on crucial but increasingly sophisticated and innovative technologies grows. A dynamic technology environment allows for periodic upgrades and retrofits, supporting the re-occurring nature of Convergint's revenues. And security and surveillance are becoming more of a core business process, regardless of industry, and as such Convergint has minimal customer or end market concentration. Convergint's ratings are supported by a sizable, better than $1.3 billion revenue base (up from approximately $800 million when Moody's originally rated the company, in early 2018). The sectors most exposed to the COVID-19 shock are those that are most sensitive to consumer demand and sentiment. Convergint serves a diversified base of customers across industries primarily in the U.S. and Canada. Its exposure is relatively limited to the sectors hardest hit by the crisis, such as retail, transportation, and energy. Nevertheless, some of the smaller companies among Convergint's base of 3,500 customers will face financial hardship, and particularly challenged sectors such as oil and gas and airlines may see an outright cessation in demand for projects. Convergint is at risk due to the project-based nature of security installation projects and the related lack of recurring, subscription-based revenues that would otherwise provide cushion against job delays and cancellations. Moody's views Convergint's liquidity as very good. A full, preemptive drawdown under the company's $75 million revolver in March has been paid off completely, while cash has built to a very healthy $157 million as of June 30th. The company acted quickly to reduce variable costs and suspended discretionary travel and marketing expenses, thus preserving its modest, very-low-double-digit EBITDA margins. Moody's expects free cash flow in excess of $100 million in 2020. In an effort to conserve funds, it has also reined in its historically active acquisition program, and Moody's expects minimal acquisition activity for the remainder of 2020. However, the revised outlook also takes into account the expectation that Convergint will resume acquisition activity in 2021. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade may be considered upon the achievement of ongoing strong revenue gains, margin expansion, and significant, sustained deleveraging below 6.0 times. Also, given the aggressive financial strategy implied by private equity ownership and an active acquisition platform, a ratings upgrade would be considered upon demonstration of restrained financial strategy, as evidenced by minimal dividend distributions and balanced funding of acquisitions. The ratings could be downgraded if Convergint experiences reversals in an anticipated favorable revenue and margin trends, such that Moody's expects debt-to-EBITDA leverage to drift up; if Moody's expects free cash flow to turn negative; or if compliance with debt covenants becomes challenged. DG Investment Intermediate Holdings 2, Inc. (formerly Gopher Sub Inc.; dba Convergint) is a service-based organization that designs, installs, and maintains building systems, with a focus in the areas of security systems, and with ancillary services in fire alarm/notification and life safety. The corporate entity was formed to facilitate Ares Management's early 2018 acquisition of Convergint from another private equity sponsor. Moody's expects the company to generate 2020 revenues of approximately $1.35 billion. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. DIE TECH SERVICES: Seeks Continued Use of Cash Collateral --------------------------------------------------------- Die Tech Services, Inc., by and through its attorneys, Miller Johnson, asks the U.S. Bankruptcy Court for the Western District of Michigan to approve the Sixth Stipulated Order that it has entered into with Byline Bank which extends the provisions of the order authorizing the Debtor to use cash collateral and granting adequate protection to Byline Bank. The Debtor will not use cash collateral in any manner or for any purpose other than as explicitly set forth in the Sixth Supplemental Budget without the prior consent of Byline Bank or further order of the Court, except that in the event the Debtor secures additional customers or additional work from current customers for outsourcing services, the Debtor may increase expense items related to budget items described as "Payroll and Taxes" and "Cost of Outsourced Services" by up to 15% without prior consent by Byline Bank or further order of the Court. Byline Bank will also receive payments of $6,000 per month no later than 10 calendar days from the dates set forth on the Sixth Supplemental Budget, unless otherwise provided by further Court order. A copy of the motion is available at https://bit.ly/3nA1HUV from PacerMonitor.com About Die Tech Services, Inc. Die Tech Services, Inc. -- http://www.dietechservices.com-- was founded in 2002 in West Michigan as a services company providing skilled labor support on an as-needed basis. Die Tech Services works with OEMs, Tier 1 and Tier 2 suppliers fulfilling their short and long-term needs. In 2009 Die Tech Services expanded its services from specialized skilled labor to include the manufacturing of "inspection fixtures and gages." In 2011, Die Tech Services added another service to it's product list "Special Machines". This division is dedicated to develop, design and build custom tooling to fit its customers specific needs. Walker, Mich.-based Die Tech Services filed for Chapter 11 bankruptcy protection (Bankr. W.D. Mich. Case No. 19-00835) on March 5, 2019. Judge John T. Gregg oversees the case. John T. Piggins, Esq., at Miller Johnson, serves as the Debtor's bankruptcy counsel. The petition was signed by Kelly C. Darby, president. In its petition, the Debtor estimated $500,000 to $1 million in assets and $1 million to $10 million in liabilities. DIGITALTOWN INC: Files for Chapter 11 Amid Dispute With Founder --------------------------------------------------------------- Andrew Allemann of Domain Name Wire reports that DigitalTown (OTC: DGTW) has filed for Chapter 11 bankruptcy after failing to come to terms with a former CEO. The company essentially ceased operations last year, intending to clean up its balance sheet and reemerge. It convinced many of its creditors to convert their debt into equity, but the company has struggled to come to terms with founder and former CEO Richard Pomije. Pomije was granted summary judgment in a lawsuit he brought against the company, and Pomije has subsequently filed another lawsuit. The bankruptcy filing states that DigitalTown owes Pomije $1.4 million. DigitalTown could gain leverage over Pomije by going into reorganization bankruptcy. Notable creditors in the domain name industry include GMO Registry ($276,000), Whatbox? Holdings ($120,000), Sam Ciacco ($260,000) and Rob Monster ($257,000). Ciacco was brought in to clean up the balance sheet, and Monster, who is CEO of Epik, was previously the CEO of DigitalTown. The filing also notes that DigitalTown stiffed NamesCon for a sponsorship fee. DigitalTown owes a total of $3.5 million to creditors. The company has tried many different business models over the years. Its latest initiative was a localized platform backed by a cryptocurrency. The company acquired 13,000 .city domain names to be used in conjunction with the local platform. It never made much money from the local platform. Much of the cash it generated in recent years was through bizarre "domain marketing development obligations." Top level domain operators would pay DigitalTown cash up front that would be used to purchase the registry’s domain names at a later date. About Digitaltown Inc. Burnsville, Minnesota-based DigitalTown, Inc., owns and operates a nationwide social networking site of hyper-local on-line communities built around their domain names and the schools and communities they represent. DigitalTown, Inc., sought Chapter 11 protection (Bankr. D. Minn. Case No. 20-32155) on Sept. 8, 2020. In the petition signed by CEO Sam Ciacco, the Debtor disclosed total assets of $2,501 and total liabilities of $3,524,789 as of the bankruptcy filing. The Hon. Katherine A. Constantine is the case judge. JOSEPH W. DICKER, P.A., led by Joseph Dicker, is the Debtor's counsel. EAST RIDGE RETIREMENT: Fitch Assigns B- Rating on $66MM 2014 Bonds ------------------------------------------------------------------ Fitch Ratings has placed the 'B-' rating assigned to approximately $66 million of series 2014 health facilities revenue bonds issued by the Alachua County Health Facilities Authority, FL bonds on behalf of East Ridge Retirement Village (ERRV) on Rating Watch Negative. SECURITY The bonds are secured by a pledge of gross revenues and receivables of the obligated group (OG), a first mortgage lien on all current and future property of the OG, and a fully-funded debt service reserve. KEY RATING DRIVERS POTENTIAL COVENANT VIOLATION: ERRV's previous forbearance agreement for a fiscal 2018 debt service coverage ratio covenant violation expired on Aug. 15, 2020. The placement of the 'B-' rating on Rating Watch Negative reflects the possibility of a fiscal 2020 rate covenant violation (coverage below 1.0x), which results in an event of default under the bond documents. Following a 45-day cure period, bondholder remedies include the acceleration of principal for the outstanding bonds. Though ERRV's rolling 12-month historical debt service coverage ratio (DSCR) calculation as of July 31, 2020, was 1.35x, Fitch calculated (DSCR) through the seven-month interim (including $562 thousand of Coronavirus Aid, Relief, and Economic Security (CARES) Act funds recognized as revenue in June) was only 0.8x. ERRV received an additional $282 thousand in stimulus after July 31, but the stimulus funds may not be sufficient to offset the loss in resident services revenue to produce 1.0x coverage through the end of the year. Fitch will monitor the outcome of the potential event of default and look to resolve the Watch once more details become available. Any outcome or remedy enforcement that negatively affects ERRV's ability to repay its debt obligations would result in a downgrade. WEAK OPERATING PROFILE/CORONAVIRUS PRESSURES: The 'B-' rating reflects Fitch's view that material default risk remains present, with a very limited margin of safety due to overall occupancy and revenues that are well behind budgeted expectations. The pandemic has affected marketing/sales efforts, reduced SNF referrals and forced temporary campus shut-downs that have caused large variability in occupancy in 2020. Independent living unit (ILU), assisted living unit (ALU) and skilled nursing facility (SNF) occupancies were mixed at 80.5%, 73.6% and 77% as of July 31, 2020 versus the community's 73.3%, 86% and 93.2% occupancies produced at Fitch's last review (as of Aug. 31, 2019). The community's ability to produce better debt service coverage by fiscal YE 2020 will depend largely upon the ability to increase census despite coronavirus pressures, especially SNF post-acute care. LIGHT LIQUIDITY AND PROFITABILITY: ERRV's unrestricted cash and investments has deteriorated to $10.5 million of as of July 31, 2020 from $13 million as of Dec. 31, 2019. This amount equates to a very weak 143 DCOH (according to the master trust indenture calculation), 15.8% cash-to-debt and 2.1x cushion ratio. Reduced liquidity is due to management's decision to refurbish vacant ILUs in anticipation of potential move-ins. Given the slow-down in marketing and sales activity, management has put a hold on capex until ILU move-ins improve. ERRV's profitability is poor as seen in the community's 115.2% operating ratio and 10.4% net operating margin - adjusted for the seven-month interim period. Weak results are due to lower than budgeted revenues in assisted living, memory support and skilled nursing and additional expenses related to COVID-19 testing, sanitation supplies, personal protective equipment and a paid pandemic leave program implemented to reduce the potential spread of the coronavirus from employees. ELEVATED LONG-TERM LIABILITY PROFILE: ERRV's long-term liability profile is elevated as evidenced by maximum annual debt service (MADS) equating to a high 17.8% of annualized revenues, which is unfavorable compared to the below-investment category median of 16.4%. Debt-to-net available of 15.6x through the interim period is also unfavorable to the below-investment category medians of 11.8x. ASYMMETRIC RISK CONSIDERATIONS: There are no asymmetric risk considerations affecting the rating determination. RATING SENSITIVITIES Factors that could, individually or collectively, lead to a positive rating action/upgrade: -- Sustained rebound in operating metrics (e.g., operating ratio below 100% and/or NOM of better than 5%) leading to cash flow generation sufficient to build adequate headroom to debt service coverage covenant; -- Notably improved liquidity ratios, particularly cash-to-debt of approximately 30% or better and significantly increased days cash on hand; -- The rating would be removed from Rating Watch Negative if ERRV is able to achieve 1.0x debt service coverage by FYE 2020. Factors that could, individually or collectively, lead to a negative rating action/downgrade: -- Debt service coverage covenant violation and failure to reach permanent forbearance agreement; -- Inability to execute continued operating improvement leading to reduced liquidity and debt service coverage. CREDIT PROFILE ERRV is a Type A life plan community located on 76 acres in the town of Cutler Bay, Florida, approximately 20 miles south of Miami. The community currently includes 221 ILUs, 90 ALUs, 31 memory care units and 74 SNF units. ILU residents are mostly in lifecare contracts with nonrefundable entrance fees. ERRV reported total operating revenues of approximately $27.4 million in fiscal 2019. ERRV is currently the only OG member. Since March 27, 2008 ERRV has been controlled by Santa Fe Senior Living (SFSL) via an affiliation agreement between ERRV and SFSL's corporate parent, SantaFe HealthCare (SFHC). Neither SFSL nor SFHC are obligated on the series 2014 bonds. SFSL opened the Terraces at Bonita Springs in July 2013 and also operates North Florida Retirement Village, a rental community in Gainesville, Florida. The recent coronavirus pandemic and related government containment measures have created a more uncertain environment for the entire LPC sector. Top-line revenue pressure and added expenses started to affect ERRV in March 2020 and could persist depending on the degree and longevity of the pandemic and related economic challenges. Fitch's ratings are forward-looking in nature, and Fitch will monitor developments in the sector as a result of the virus outbreak as it relates to severity and duration, and incorporate revised expectations for future performance and assessment of key risks. REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. ESG CONSIDERATIONS Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. EBONY MEDIA: Bridgeman Sports-Led Auction Set --------------------------------------------- Law360 reports that a Texas bankruptcy judge on Friday gave the bankrupt owner of long-running Black cultural magazines Ebony and Jet the go-ahead to put itself up for sale with a $14 million stalking horse bid. Under the bid procedures approved by U.S. Bankruptcy Judge David Jones at the remote hearing, prospective buyers of Ebony Media Operations will have until Dec. 7, 2020 to submit a higher bid for the company than the offer made by Bridgeman Sports and Media LLC at the beginning of September 2020. About Ebony Media Ebony Media Holdings LLC is the publisher of Black cultural magazines Ebony and Jet. In a pair of involuntary bankruptcy petitions filed July 2020 creditors Parkview Capital Credit Inc., photo studio Plum Studio and law firm David M. Abner & Associates said Houston-based Ebony Media Holdings LLC "is generally not paying its debts as they become due, unless they are the subject of a bona fide dispute as to liability or amount." The alleged creditors filed involuntary Chapter 7 petitions against Ebony Media Operations, LLC, and Ebony Media Holdings LLC (Bankr. S.D. Tex. Case No. 20-33665 and 20-33667) on July 23, 2020. The Court on Sept. 3, 2020, entered an order approving a stipulation signed by the Debtors and the petitioners to an entry of order for relief in the bankruptcy cases and the conversion of the cases to cases under Chapter 11 of the Bankruptcy Code. The Debtors tapped Pendergraft & Simon, LLP as counsel and FTI Capital Advisors, LLC, as investment banker. EKSO BIONICS: May Sell up to $7.5M Worth of Common Stock -------------------------------------------------------- Ekso Bionics Holdings, Inc., entered into an At-The-Market Offering Agreement with H.C. Wainwright & Co., LLC pursuant to which the Company may offer and sell from time to time to or through the Agent shares of its common stock, $0.001 par value per share. The offer and sale of shares of the Company's Common Stock through the Agent, acting as sales agent, will be made pursuant to the registration statement on Form S-3 (File No. 333-239203), which was declared effective by the Securities and Exchange Commission on June 26, 2020, and a related Prospectus Supplement filed with the SEC on Oct. 9, 2020, for an aggregate offering price of up to $7.5 million. Under the Offering Agreement, the Company may offer and sell shares of its Common Stock through the Agent, acting as sales agent, by any method permitted by law deemed to be an "at the market offering" as defined in Rule 415 of the Securities Act of 1933, as amended, or in privately negotiated transactions, subject to certain conditions. The Agent has agreed in the Offering Agreement to use its commercially reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations to sell such shares in accordance with its instructions (including any price, time or size limit or other customary parameters or conditions the it may impose). Under the Offering Agreement, shares of the Company's Common Stock may not be sold for a price lower than $6.75 per share. The Company has agreed to pay the Agent a placement fee of 3% of the gross sales price of any of the shares of its Common Stock sold through the Agent. Pursuant to the Offering Agreement, the Offering may be terminated upon notice by the Company or the Agent or otherwise by its mutual agreement. The Company is not obligated to sell and the Agent is not obligated to buy or sell any shares under the Offering Agreement. No assurance can be given that the Company will sell any shares under the Offering Agreement, or, if it does, as to the price or amount of shares that it sells, or the dates when such sales will take place. About Ekso Bionics Ekso Bionics -- http://www.eksobionics.com-- is a developer of exoskeleton solutions that amplify human potential by supporting or enhancing strength, endurance and mobility across medical and industrial applications. Founded in 2005, the Company continues to build upon its expertise to design some of the most cutting-edge, innovative wearable robots available on the market. The Company is headquartered in the Bay Area and is listed on the Nasdaq Capital Market under the symbol EKSO. Ekso Bionics reported a net loss of $12.13 million for the year ended Dec. 31, 2019, compared to a net loss of $26.99 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $22.35 million in total assets, $22.38 million in total liabilities, and a total stockholders' deficit of $28,000. OUM & CO. LLP, in San Francisco, California, the Company's auditor since 2010, issued a "going concern" qualification in its report dated Feb. 27, 2020, citing that Company has incurred significant recurring losses and negative cash flows from operations since inception and an accumulated deficit. This raises substantial doubt about the Company's ability to continue as a going concern. EXIDE HOLDINGS: Buyer Atlas Objects to Bankruptcy Plan ------------------------------------------------------ Alex Wolf of Bloomberg Law reports that the purchaser of Exide Holdings Inc.'s North American business objected to the battery maker's bankruptcy plan, saying the company hasn't demonstrated it can pay a post-closing adjustment of $19.7 million. The buyer, an affiliate of Atlas Holdings LLC, told the U.S. Bankruptcy Court for the District of Delaware in a filing Friday that Exide can't confirm its Chapter 11 plan because the company is administratively insolvent. "Buyer endeavors to negotiate a commercial resolution with the debtors," it said. "Such a resolution, however, cannot be reached in time for the combined hearing under the terms of the Americas Sale Transaction." About Exide Holdings Founded in 1888 and headquartered in Milton, Ga., Exide Holdings, Inc. -- https://www.exide.com/ -- is a stored electrical energy solutions company and a producer and recycler of lead-acid batteries. Across the globe, Exide batteries power cars, boats, heavy duty vehicles, golf carts, powersports, and lawn and garden applications. Its network power solutions deliver energy to vast telecommunication networks in need of uninterrupted power supply. Exide Technologies first sought Chapter 11 protection (Bankr. Del. Case No. 02-11125) on April 14, 2002, and exited bankruptcy two years after. Matthew N. Kleiman, Esq., and Kirk A. Kennedy, Esq., at Kirkland & Ellis, and James E. O'Neill, Esq., at Pachulski Stang Ziehl & Jones LLP, represented the Debtors in their successful restructuring. Exide returned to Chapter 11 bankruptcy (Bankr. D. Del. Case No. 13-11482) on June 10, 2013 and emerged from bankruptcy in 2015. In the 2013 case, Exide tapped Skadden, Arps, Slate, Meagher & Flom LLP, and Pachulski Stang Ziehl & Jones LLP as counsel; Alvarez & Marsal as financial advisor; Sitrick and Company Inc. as public relations consultant. The official creditors committee retained Lowenstein Sandler LLP and Morris, Nichols, Arsht & Tunnell LLP as co-counsel, and Zolfo Cooper, LLC served as its bankruptcy consultants and financial advisors. Exide Holdings and its affiliates, including Exide Technologies LLC, sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-11157) on May 19, 2020. Exide Holdings was estimated to have $500 million to $1 billion in assets and $1 billion to $10 billion in liabilities. In the newest Chapter 11 case, Weil, Gotshal & Manges LLP is serving as legal counsel to Exide, Houlihan Lokey is serving as investment banker, and Ankura is serving as financial advisor. Richards, Layton & Finger, P.A., is the local counsel. Prime Clerk LLC is the claims agent, maintaining the page https://cases.primeclerk.com/Exide2020/ EXPO CONSTRUCTION: 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 Expo Construction Group, LLC. About Expo Construction Group Expo Construction Group, LLC, a Houston-based general contractor, filed a voluntary petition for relief under Chapter 11 of the United States Code (Bankr. S.D. Texas Case No. 20-34099) on Aug. 18, 2020. Melida Taveras, managing member, signed the petition. At the time of filing, the Debtor estimated $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. The Law Office of Margaret M. McClure serves as the Debtor's legal counsel. FLOYD CHARLES YORK: Chairs Buying Oxon Piney Point for $135K ------------------------------------------------------------ Floyd Charles York asks the U.S. Bankruptcy Court for the Eastern District of Virginia to authorize the sale of the real property located at 17218 Piney Point Road, Piney Point, Maryland to Raymond Scott Chairs and Christine Chairs for $135,000. On Sept. 16, 2020, York entered into the Unimproved Land Contract of Sale to sell the Property to Raymond the Buyers for the agreed purchase price with an expected closing date of Oct. 16, 2020. The Buyers' agent, Pam Milan and Century 21 Redwood Realty will be paid a commission of 2.5% of the sales price. York and Coldwell Banker Residential Brokerage are to be paid a commission of 3.5% of the sales price. The Property is subject to a Deed of Trust held by Ceres Capital Partners, LLC which has a current balance of approximately $76,346. York does not anticipate any significant tax liability resulting from the sale of the Property. It asks that the Court approves the sale of the Property under the terms of the Sale Contract and authorizes the payment at settlement of the Deed of Trust Note; real estate commissions; and all other ordinary and appropriate fees and costs that arise in connection with the closing on the sale of the Property, consistent with the sales contract and existing brokerage agreements with all remaining funds to be distributed to York as the DIP. In order to ensure the expeditious closing of the proposed sale consistent with the closing date established in the sales contract, York further asks that the 14-day stay of any order authorizing sale of the Property be waived. A copy of the Contract is available at https://tinyurl.com/yxmg7sfg from PacerMonitor.com free of charge. Floyd Charles York sought Chapter 11 protection (Bankr. E.D. Va. Case No. 19-13106) on Sept. 18, 2019. The Debtor's counsel: VIVONA PANDURANGI, PLC Jonathan B. Vivona King Street, Suite 400 Alexandria, Virginia 22314 Tel: (703) 739-1353 Fax: (703) 337-0490 E-mail: jvivona@vpbklaw.com FRIENDSHIP VILLAGE: Fitch Affirms BB+ on 2012/2013A/2018A Bonds --------------------------------------------------------------- Fitch Ratings has affirmed the 'BB+' ratings on the series 2012, series 2013A, series 2017, and series 2018A revenue bonds issued by The Industrial Development Authority of the County of St. Louis Missouri on behalf of Friendship Village of St. Louis (FVSTL). The Rating Outlook is Stable. SECURITY The bonds are secured by a pledge of gross revenues of the obligated group (OG), a mortgage on certain properties and equipment, and a debt service reserve fund. KEY RATING DRIVERS ROBUST DEMAND: Despite being in a competitive market, FVSTL's demand for its services remains strong across both of its campuses and all levels of care, which is partially driven by its communities being the only life care (Type-A) life plan communities (LPCs) in its primary market area. Over the last three fiscal years, FVSTL has averaged a strong 93% in its independent living units (ILUs), 97% in its assisted living units (ALUs), and 90% in its skilled nursing facility (SNF) beds. While census levels are expected to soften over the short-term due to disruptions from the coronavirus pandemic, Fitch believes FVSTL's strong demand indicators should continue to translate into strong census levels over the longer term. CAPITAL PROJECT ON TRACK: FVSTL is nearly complete with its large capital repositioning and expansion projects at both of its campuses. The projects are expected to cost approximately $200 million and are being funded by the series 2018A bond proceeds and approximately $25 million in temporary debt that will be paid off with initial entrance fees. The project is currently under budget, with construction expected to be completed by the end of 2020. Additionally, FVSTL remains ahead of schedule on selling and filling its new 128 ILUs across both campuses, which are 91% sold and 88% occupied as of August 2020. ADEQUATE FINANCIAL PROFILE: In recent years, FVSTL's operational performance has remained somewhat weak but sufficient for a Type-A facility at its rating level. Over the last three fiscal years, FVSTL has averaged a 101.4% operating ratio, 4.1% net operating margin (NOM), and 15.3% NOM-adjusted (NOMA), which all are on par or weaker than Fitch's 'BIG' medians. However, Fitch expects FVSTL's core operations and total cash flows levels to improve following completion and stabilization of its capital projects, which should be accretive to its financial profile. SUFFICIENT LIQUIDITY POSITION: As of fiscal 2020, FVSTL had $100.4 million in unrestricted cash and investments, which translates into 698 days cash on hand (DCOH), 31.9% cash to debt, and 5.1x cushion ratio. These all compare favorably to Fitch's 'BIG' medians and remain sufficient for FVSTL's current rating level. While cash to debt is expected to decline briefly following draw down of FVSTL's temporary debt, management expects to quickly pay down its temporary debt with initial entrance fees from the project. LONG-TERM LIABILITY PROFILE: FVSTL's debt burden remains elevated as evidenced by maximum annual debt service (MADS) equating to a high 31.9% of fiscal 2020 revenues, which is substantially weaker than Fitch's 'BIG' medians of 16.4%. Additionally, debt to net available measured an elevated 30x in fiscal 2020. However, both metrics are expected to improve significantly following project completion and stabilization, which should meaningfully boost FVSTL's total revenues and annual cash flow levels. ASYMMETRIC RISK FACTORS: There are no asymmetric risk factors affecting this rating determination. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- While outside of the current outlook period, successful completion of its capital project, coupled with improvement in key financial metrics closer to Fitch's 'BBB' medians. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- While unlikely given the current status of FVSTL's projects, any project execution issues such as construction delays, cost overruns, or service disruptions that negatively impact its operating or financial profiles. -- Unexpected deterioration in cash flow levels or unrestricted reserves that results in cash to debt falling below 30% or stabilized MADS coverage levels below 1.5x. -- Should economic conditions decline further than expected from Fitch's current expectations or should a second wave of infections occur, Fitch would expect further pressures on FVSTL's revenue base. If there are significant additional pressures on FVSTL's revenue base due to the pandemic, which materially deteriorates its operations, cash flow levels, or unrestricted reserves, there could be rating pressure. CREDIT PROFILE FVSTL operates two LPCs: Friendship Village of Sunset Hills (FVSH) and Friendship Village of Chesterfield (FVC). FVSH and FVC historically operated as distinct entities. However, in 2017, FVC joined FVSH's existing OG, which is now called FVSTL. The FVSTL OG also includes FV Operations, LLC (FVO), which was established to employ personnel working at FVC, FVSH, and other affiliated entities. FVSH owns and operates a life care (Type-A) LPC on 52 acres in Sunset Hills, MO. FVSH is comprised of 342 IL apartments, 44 IL villas, 61 ALUs, and 118-bed SNF. FVC owns and operates a life care LPC on 37 acres in Chesterfield, MO. FVC is comprised of 262 IL apartments, 39 IL villas, 22 ALUs, and 99 SNF beds. FVC and FVSH are located approximately 16 miles apart. All three OG entities are solely owned by FV Services, Inc., which also wholly owns FV Management, a management service line of the system, and FV at Home. FV at Home wholly owns two subsidiaries: FV at Home - Supportive Service, which provides private duty services to residents and FV at Home - Home Health, which provides Medicare-certified post-acute care services. The non-OG management service line employs senior management of the system and allocates costs commensurate with the level of services provided to each OG member. Total operating revenues of FVSTL in fiscal 2020 were $60 million. The outbreak of the coronavirus and rise in related government containment measures created an uncertain environment for the entire healthcare sector in the near term. While FVSTL's financial performance through the most recently available data (June 30, 2020) has not indicated any material impairment as a direct result of the pandemic, material changes in revenue and costs profiles will occur across the sector. Fitch's ratings are forward looking, and Fitch will monitor developments in the sector as a result of the virus outbreak as it relates to severity and duration, and incorporate revised expectations for future performance and assessment of key risks. CAPITAL PROJECT ON TRACK FVSTL is underway and almost complete on its capital renovation and expansion projects at both of its campus. At its FVC campus, FVSTL is adding 52 new IL apartments located in a five-story building with an underground garage, constructing a four-story new 60-bed ALU and MCU building, and replacing its existing SNF with a two-story building that holds 74 private rooms and eight semi-private rooms. Additionally, the FVC project will incorporate a new clubhouse and various new amenities and common space renovations. At its FVSH campus, FVSTL is adding 76 new IL apartments located in a five-story building with an underground garage, adding 15 new memory care units (MCUs), and a replacing its existing SNF. Additionally, the FVSH project includes a skybridge that will connect the IL campus and new SNF building, a two-story clubhouse expansion, and various new amenities and common space renovations. Total project costs are approximately $200 million, which are being entirely funded out of FVSTL's series 2018 bond proceeds, including $25 million in temporary bank notes. The temporary bank notes will be paid down from a portion of the initial entrance fees, which are estimated to be approximately $45 million. FVSTL management expects to begin drawing down its temporary bank notes in the fall of 2020. To date, the project is under budget and largely on time. While there have been some delays in certain phases of the project throughout project construction, all construction is expected to be completed by the end of 2020 which was the project's initial completion date. Project fill-up was initially expected to occur in fiscal 2021 and 2022, with fiscal 2023 being the first full year of project stabilization. However, FVSTL is well ahead of initial expectations on project fill-up as its FVC's new ILUs are 94% sold and occupied at Aug. 31, 2020, while its FVSH's new ILUs were 89% sold and 84% occupied at Aug. 31. 2020. Overall, the project is expected to be accretive to both FVSTL's operating and financial profiles with substantial increases in its total revenues and annual cash flow levels following project stabilization. With project ILU sales and fills way ahead of schedule, Fitch believes FVSTL is well positioned to successfully execute on its project despite ongoing disruptions to the senior living industry from the coronavirus pandemic. ROBUST DEMAND INDICATORS FVSTL continued to demonstrate strong demand across its two campuses and all levels of care. FVC and FVSH are the only life care LPCs in the St. Louis metro service area, which is a differentiating factor to prospective residents that has historically supported robust demand. In fiscal 2020, FVSTL averaged 93% occupancy in its ILUs, 95% in its ALUs, and 87% in its SNF beds. FVSTL currently maintains IL wait lists of 67 people for its two campuses. While census has historically been strong, Fitch expects FVSTL's census levels to soften over the short-term due to disruptions from the coronavirus pandemic. FVSTL management reports that current census levels are approximately 90% in its ILUs, 85% in its ALUs, and 80% in its SNF. The lower occupancy rates are directly attributable to the coronavirus pandemic, which has disrupted traditional marketing channels and turnover levels as well as directly impacted census in health center with increased regulations, including isolation restrictions on incoming residents. Regardless, Fitch believes FVSTL's demand indicators remain strong and expects census to improve in all levels of care over the medium term, particularly once it completes its repositioning and expansion project. FINANCIAL PROFILE FVSTL's core operations have been somewhat weak in recent years, but remain sufficient for a Type-A facility at its current rating level. Over the last three fiscal years, FVSTL has averaged a 101.4% operating ratio and 4.1% NOM. While somewhat weak, both metrics remain improved from the 107% operating ratio and 2.8% NOM averaged during fiscal 2016 - 2017. Fitch attributes the improvements to the realized synergies from its new organizational structure as well as its favorable residency pricing contract changes enacted a couple years ago. However, despite improvement in its core operations, FVSTL has seen deterioration in its cash flow from net entrance fees receipts in recent years. FVSTL averaged a strong $11.2 million in annual net entrance fees from fiscal 2016 - 2017, which declined to an average of $7.1 million in fiscal 2018 - 2019. Fitch attributes the weaker cash flow levels to softening census levels and lower than expected turnover levels. Additionally, FVSTL experienced further declines in its net entrance fees in fiscal 2020 to $3.8 million, which Fitch attributes to disruptions from the coronavirus pandemic that impacted census, turnover levels, and move-ins from March - June 2020. However, Fitch expects FVSTL's net entrance fee receipts will rebound and improve over the medium term as it benefits from its enacted residency contract price changes, having a higher number of ILUs following project completion, and recovers its ILU census levels. LONG-TERM LIABILITY PROFILE As of fiscal 2020, FVSTL had approximately $313 million in outstanding long-term permanent debt, which includes: $204 million in series 2018A bonds, $48 million in series 2017 bonds, $40 million in series 2013A bonds, and $24 million in series 2012 bonds. Additionally, FVSTL is expected to begin drawing down its $25 million in temporary short-term bank notes in fiscal 2021 to finance the remaining costs of its capital expansion and repositioning project. The short-term notes are expected to be paid off with initial entrance fees from FVSTL's new ILUs no later than 2023. However, Fitch expects FVSTL will pay down the short-term notes quicker given most of its new ILUs have been sold and filled. FVSTL has no exposure to derivative instruments or a defined benefit pension plan. FVSTL's MADS is approximately $19.6 million, which equates to a high 31.9% of fiscal 2020 revenues. Additionally, FVSTL's debt to net available measured a weak 30x in fiscal 2020, reflecting both its high leverage position as well as its weaker annual cash flow levels in fiscal 2020 due to disruptions from the coronavirus pandemic. Regardless, Fitch expects FVSTL's debt burden to moderate in the coming years as new revenues from the project come online. Original third-party forecasts from its 2018 bond issuance forecasted MADS equating to a high, but more manageable, 23% of fiscal 2023 revenues, the first full year of project stabilization. Additionally, MADS coverage is still estimated at approximately 1.5x in fiscal 2023, which remains sufficient for FVSTL's current rating level. However, should cash flow levels be lower than expected following project stabilization that results in coverage lower than 1.5x, there could be negative pressure. REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING The principal sources of information used in the analysis are described in the Applicable Criteria. ESG CONSIDERATIONS Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. FUELCELL ENERGY: Wins $8M Funding for Energy Project from DoE ------------------------------------------------------------- FuelCell Energy, Inc., has been selected by the U.S. Department of Energy's Office of Energy Efficiency and Renewable Energy, in collaboration with the Office of Nuclear Energy, for an $8.0 million funding award to support the design and manufacture of a SureSource electrolysis platform capable of producing of hydrogen. FuelCell Energy has previously demonstrated multi-stack solid oxide power generation systems at both the 50kW and 200kW output levels. This project will be the first multi-stack electrolysis system produced with the Company's solid oxide technology. The system will be equipped with an option to receive thermal energy, thus increasing the electrolysis electrical efficiency to over 90%. Following the design, manufacture and testing of the system at FuelCell Energy's Danbury, CT facility, the electrolysis system will be delivered to Idaho National Laboratories (INL), where it will undergo rigorous testing to confirm the electric efficiency, as well as the ability to utilize nuclear power plant waste heat to obtain higher efficiencies of up to 100%. This highly efficient electrolysis platform is expected to provide much needed flexibility to baseload nuclear power generation. Additionally, beyond validating the efficiency performance levels, this demonstration project will accelerate the control schemes and integration design. This project represents a key step in FuelCell Energy's path to commercialize its high efficiency solid oxide electrolysis technology. The multi-stack module that forms the core of the system is a modular building block easily scalable for larger systems. The solid oxide electrolysis technology has the potential to be an economical, near-term solution for energy and environmental needs that simultaneously supports the advancement of nuclear plant utilization. Additionally, electrolysis technology can support the hydrogen economy by providing carbon-free, clean hydrogen for transportation, power generation, agricultural uses, and a host of other industrial applications. About FuelCell Energy Headquartered in Danbury, Connecticut, FuelCell Energy, Inc. -- http://www.fuelcellenergy.com-- is a global developer of environmentally responsible distributed baseload power solutions through its proprietary fuel cell technology. The Company develops turn-key distributed power generation solutions and operate and provide comprehensive services for the life of the power plant. The Company provides solutions for various applications, including utility-scale distributed generation, on-site power generation and combined heat and power, with the differentiating ability to do so utilizing multiple sources of fuel including natural gas, Renewable Biogas (i.e., landfill gas, anaerobic digester gas), propane and various blends of such fuels. Fuelcell reported a net loss attributable to common stockholders of $100.25 million for the year ended Oct. 31, 2019, a net loss attributable to common stockholders of $62.17 million for the year ended Oct. 31, 2018, and a net loss attributable to common stockholders of $57.10 million for the year ended Oct. 31, 2017. As of July 31, 2020, the Company had $436.8 million in total assets, $280.6 million in total liabilities, $59.86 million in redeemable Series B preferred stock, and $96.32 million in total stockholders' equity. GENERAC POWER: Moody's Upgrades CFR to Ba1, Outlook Stable ---------------------------------------------------------- Moody's Investors Service upgraded Generac Power Systems, Inc.'s corporate family rating and senior secured rating to Ba1 from Ba2, and probability of default rating to Ba1-PD from Ba2-PD. The Speculative Grade Liquidity rating is unchanged at SGL-1. The rating outlook is stable. The upgrade to Ba1 takes into account expectations for steady growth in profit and cash flow as Generac increases penetration of its flagship product, residential standby generators, and develops ancillary business off of that installed base. Social change was a key rating driver as home generators, where Generac has a well-recognized brand, are likely to become more prevalent as uninterrupted power in the residence becomes more of a requirement with changing work patterns. As well, Moody's anticipates Generac will grow profitably while preserving a conservative capital structure over time with debt-to-EBITDA in the 2 to below 3 times range. RATINGS RATIONALE "Generac will experience robust demand for its residential home standby generators for years to come, in part from power outages due to volatile weather and the aging US electrical grid, but also from greater importance being placed on a continuous uninterrupted power supply to the home going forward and utility induced shutdowns in certain regions" said Moody's Vice President and lead analyst for Generac, Brian Silver. "However, greater scale and product diversification beyond residential home standby generators will be important factors for further improvement in the credit profile. Unless the company makes a transformational acquisition, this will take some time, as clean energy products are a small, but growing, portion of sales," continued Silver. Generac's Ba1 rating reflects the company's strong position and solid brand strength in the North American residential and Commercial & Industrial (C&I) standby generator market, as well as its moderate leverage of about 2.1 times debt-to-EBITDA. Generac is expected to expand beyond its already healthy EBITDA margin of approximately 20%, and with capex to sales of about 3%, the company will produce strong free cash flow likely to be around $250 to $350 million over the coming year. Generac also has very good liquidity supported by a relatively large cash balance and access to its largely undrawn ABL. Generac is investing in the nascent, but rapidly growing clean energy on-site power storage market, spurred by the 2019 acquisitions of Neurio (home energy monitoring systems) and Pika Energy (energy storage systems). This will help product diversity, in time. However, Generac's ratings also consider the company's very high product concentration and significant reliance on the North American market. The company will be challenged to continue expanding internationally while not materially diluting the strong margins it generates domestically. In addition, the C&I segment has been under pressure of late from the pandemic. Moody's expects the company to make only very modest sized acquisitions, with either an international presence or competitive edge from a technological or environmental perspective. Larger transactions are possible, but not probable. The company could become more shareholder-friendly over time. For now, Generac does not pay dividends. The SGL-1 speculative grade liquidity rating reflects its view that the company will have very good liquidity through 2021, supported by a healthy cash position ($392 million as of June 30, 2020), free cash flow of more than $250 million, and external liquidity with an ABL revolver due 2023 with modest usage. Moody's believes that Generac's environmental risk is relatively low, as one of its key areas of focus going forward is to grow its position in the rapidly evolving clean energy market for residential use. Moody's also believes Generac's social risk is relatively low, although governance risk is modest, as the company may become more shareholder-friendly over time. However, the company has managed its balance sheet conservatively over the last several years, does not pay a dividend, and has been rather restrained with respect to share repurchases. In addition, Generac is publicly listed, and has an appropriate composition of outside directors with active committees. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects its expectation that Generac will continue to generate strong free cash flow while sustaining financial leverage below 2.25 times debt-to-EBITDA. The ratings could be upgraded if the company improves its product and geographic diversity, and increases its scale while sustaining the strong profit margins and good returns. Moody's would also expect debt-to-EBITDA to be sustained in the 2 to 2.5 times range and free cash flow-to-debt sustained at more than 30% with the meaningfully larger scale, and the company to maintain prudent shareholder policies consistent with stable credit metrics. The ratings could be downgraded if debt-to-EBITDA is sustained approaching 3 times, free cash flow-to-debt is sustained below 20%, or EBITDA margin deteriorates to the high teens. In addition, the rating could be downgraded with a shift towards more aggressive financial practices, change in shareholder friendliness or if the company executes a sizable debt funded acquisition that weakens the balance sheet or changes the business profile meaningfully. Upgrades: Issuer: Generac Power Systems, Inc. Corporate Family Rating, Upgraded to Ba1 from Ba2 Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD Senior Secured Bank Credit Facility, Upgraded to Ba1 (LGD4) from Ba2 (LGD4) Outlook Actions: Issuer: Generac Power Systems, Inc. Outlook, Remains Stable The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Generac Power Systems, Inc. (Generac), headquartered in Waukesha, WI, is a leading designer and manufacturer of a wide range of power generation equipment, energy storage systems, and other power products serving the residential, light commercial and industrial markets. The company employs over 6,000 employees, and its products are sold globally through independent dealers, distributors, retailers, wholesalers, equipment rental companies, e-commerce partners, and in some cases direct to end users. Generac generated $2.2 billion of revenue for the twelve months ended June 30, 2020. GENEVER HOLDINGS: Voluntary Chapter 11 Case Summary --------------------------------------------------- Debtor: Genever Holdings LLC 781 5th Ave Apt 1801 New York, NY 10022-5520 Business Description: Genever Holdings LLC is the owner of the entire 18th Floor Apartment and auxiliary units in the Sherry Netherland Hotel located at 781 Fifth Avenue, New York, NY 10022. Chapter 11 Petition Date: October 12, 2020 Court: United States Bankruptcy Court Southern District of New York Case No.: 20-12411 Debtor's Counsel: Kevin J. Nash, Esq. GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP 1501 Broadway 22nd Floor New York, NY 10036 Tel: (212) 221-5700 E-mail: knash@gwfglaw.com Estimated Assets: $50 million to $100 million Estimated Liabilities: $50 million to $100 million The petition was signed by Yanping Wang, authorized representative. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors. A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/73656UI/Genever_Holdings_LLC__nysbke-20-12411__0001.0.pdf?mcid=tGE4TAMA GG/MG INC: Sets Sale Procedures for Herculaneum Assets ------------------------------------------------------ GG/MG, Inc., asks the U.S. Bankruptcy Court for the Eastern District of Missouri to authorize the sale procedures in connection with the sale auction of (i) the real estate at 1535 McNutt Street, Herculaneum, Missouri, and (ii) various items of inventory and equipment at the Herculaneum address. Among its primary assets are the following: (a) the Debtor owns, subject to any valid and enforceable liens, the Real Estate at which location it its business: and (b) the Debtor owns, subject to any valid and enforceable liens, the Personal Property. The only interests, liens, claims, and encumbrances with respect to the Real Estate are the following: (a) a Deed of Trust held by Midwest Regional Bank ("MRB D/T"); (b) a judgment lien in favor of MH Transportation Freight Forwarders, arising subsequent to the MRB D/T; (c) a judgment lien in favor of DTI, Inc. arising subsequent to the MRB D/T ; (d) unpaid real estate taxes due and owing on the Real Estate; and (e) a lien in favor of the Internal Revenue Service arising subsequent to the MRB D/T. The Debtor is aware of no other liens with respect to or affecting the Real Estate. The only interests, liens, claims, and encumbrances with respect to the Personal Property proposed to be sold pursuant to the Motion are the following: (a) the UCC-1 Filing by MRB; (b) a lien in favor of the Internal Revenue Service ("IRS PP Lien"); and (c) a purported UCC-1 filed by Funding Metrics, LLC. The Debtor is aware of no other liens with respect to or affecting the Personal Property. The sale of Property will be free and clear of the interests, liens, claims, and encumbrances, with all such interests, liens, claims, and encumbrances to attach to the sale proceeds. The proposed sale, subject to the Auction and the Sale Procedures, will provide the best opportunity for a recovery from the Debtor's real and personal property assets. Prior to the commencement of these proceedings, and thereafter, the Debtor has worked to identify possible strategic partners with respect to the sale of its real and personal assets. While no acquisition was agreed to, it received several expressions of interest. The Auction and the Sale Procedures are a continuation of that process, but on a broader scale. The Debtor has partnered with OSP, LLC, doing business as ATEC, to provide services related to the auction of its real and personal property. The terms and conditions of the compensation of ATEC are set out in the Exhibit A. In connection with the sale of its Real Estate and Personal Property, and in consultation with ATEC and MRB, the Debtor believes it appropriate to establish certain sale procedures and asks approval of the auction procedures. With respect to the Personal Property to be sold at the auction, the Debtor, in consultation with ATEC and MRB proposes the following procedures: A. ATEC will conduct an on-line auction with respect to the Personal Property and will, with the assistance of the Debtor's principals, prepare appropriate lots for the Personal Property. Potential Bidders will be able to view the sale property and information about same on ATEC's web site and will be able inquire about the content of each lot. B. Potential Bidders will be able to make bids on: (i) the Real Estate only; (ii) all of the Personal Property; (ii) portions of the Personal Property; or (iv) all of the Real Estate and the Personal Property. C. After lotting the property, ATEC will commence marketing the auction to Potential Bidders as soon as practicable after approval of the Motion. D. MRB will be issued a bidder number and may bid, including a credit bid, on the Personal Property. E. ATEC will accept bids starting Oct. 21, 2020 and bidding will close on Nov. 4, 2020. Nothing will prevent MRB from making a credit bid on either the Real Estate or the Personal Property, or on both. Within five business days of the closing of bids, ATEC will notify the successful bidders on the Personal Property and the Debtor will submit a report to the Court detailing the lots sold, the identity of the successful bidders, and the price paid by the successful bidder. F. Following the auction, successful bidders on the Personal Property will be required to remove their purchased lot(s) between Nov. 5, 2020 and Dec. 11, 2020. To the extent that any Personal Property does not sell, the Debtor and ATEC will use sale proceeds from the sale of the Personal Property to remove said property and sell or otherwise dispose of same, with the proceeds thereof added to the net auction proceeds for distribution pursuant to order of the Court. G. From the proceeds of the auction of the Personal Property, the Debtor will retain the net cash requirements set out in a wind-down budget to be submitted to the Court at the hearing on the Motion. With respect to the auction of the Real Estate to be sold at the auction, the Debtor, in consultation with ATEC and MRB proposes the following procedures: A. The Debtor has accepted a contract with Environmental Works, Inc. for sale of the Real Estate. B. Any bid submitted to ATEC with respect to the Real Estate must exceed the net purchase price on the EWI Contract (i.e. the sale price less commissions) by $25,000 and be on substantially the same terms as the EWI Contract (i.e. such bid must be in an amount, net of any commissions, in excess of $1,059,000). MRB may bid, including a credit bid (up to the amount owed on its Deed of Trust), on the Real Estate. C. ATEC will accept competing bids on the Real Estate during the same period, and with the same Bid Deadline, during which it accepts bids for the Personal Property. Any bidder for the Real Estate, will be required to submit a signed contract on the same or substantially the same terms as the EWI Contract. ATEC will maintain a copy of the EWI Contract on its web site. Any competing bidder will download the EWI Contract and submit it with its changes to ATEC. D. All bidders for the Real Estate must also submit with their bid: (i) a refundable earnest money deposit in an amount at least equal to that set out in the EWI Contract (i.e. $25,000); and (ii) proof of such bidder’s financial ability to close. Upon receipt of the foregoing, ATEC will issue such bidder a bidder number. No person may submit a bid unless it has received a bidder number. ATEC will hold each Deposit in an escrow account. If a bidder for the Real Estate is not the Successful Bidder, ATEC will return the Deposit to such bidder within seven days of Dec. 11, 2020. MRB will be issued a bidder number and may bid on the Real Estate, including a credit bid. E. If ATEC receives a competing bid for the Real Estate, it will send a copy of that bid to counsel for the Debtor, the counsel for MRB, the Subchapter V Trustee, the representative of the existing highest bidder, and the representative of the competing bidder. The Debtor and MRB will confer and within one business day inform ATEC, the Notice Parties of the identity of the current highest and best bid. ATEC will then identify the highest and best bidder on its website. F. If a competing bid is received within 24 hours of the Bid Deadline, the parties who have submitted qualifying bids will have one additional date to submit one additional bid. The Debtor will, in consultation with MRB, consider the Final Bids and determine the holder of the winning bid. It will identify the Successful Bidder of the Real Estate in is Sale Report, ranking those parties submitting a Final Bid and will serve allpersons making a qualifying bid. G. If the Real Estate is sold to a bidder other than the buyer in the EWI Contract, the buyer under the EWI Contract will receive, at closing a break-up fee of $5,000 and a reimbursement of up to $10,000 in actual, documented expenses. If EWI is the Successful Bidder on the Real Estate, EWI will receive no break-up fee or expense reimbursement. If the Real Estate is sold pursuant to a credit bid, the aforementioned break-up fee and expense reimbursement will be paid to EWI by the Successful Bidder of the Real Estate who submitted the credit bid. H. The sale of the Real Estate will close on December 12, or as soon thereafter as practical. In the event that the Successful Bidder on the Real Estate does not close by the close of business Dec. 28, 2020, such bidder will forfeit its Deposit as liquidated damages and the Debtor may proceed to close with the next highest bidder. I. Within three business days of closing of the Real Estate sale, the Debtor will file a report with the Court to confirm said closing. At closing of the sale of the Real Estate, the amount necessary to pay the Deed of Trust to MRB will be paid after payment of necessary and appropriate closing costs. If the amount is insufficient to satisfy the Deed of Trust, MRB agrees to release and will release its Deed of Trust upon payment of real estate taxes, costs of sale, and customary prorations, and the Real Estate will be transferred to the successful bidder. In order to effect the lotting and pre-auction, the Debtor must effectively cease operations and focus on the preparation of the property for sale, including assisting ATEC in determining what property will be included in which lot and providing information on the type of property making up the inventory and equipment. A copy of the Agreement is available at https://tinyurl.com/y2auzvve from PacerMonitor.com free of charge. About GG/MG Inc. GG/MG, Inc. is a landfill compactor in Herculaneum, Mo. It conducts business under the name Landfill Equipment Sales, Service & Parts. Visit http://www.landfill-equip.comfor more information. GG/MG sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mo. Case No. 20-42506) on May 12, 2020. The petition was signed by GG/MG President Danielle. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $1 million and $10 million. Judge Kathy A. Surratt-States oversees the case. Goldstein & Pressman, P.C., is the Debtor' legal counsel. GLOBAL AIRCRAFT: Moody's Lowers Unsec. Notes to B1, Outlook Neg. ---------------------------------------------------------------- Moody's Investors Service downgraded to B1 from Ba2 the long-term rating on senior unsecured notes issued by Global Aircraft Leasing Co., Ltd. (GALC), the entity that holds Bohai Leasing Co., Ltd.'s (Bohai) 70% shareholder interest in commercial aircraft leasing concern Avolon Holdings Limited (Baa3 negative). GALC's outlook is negative. This concludes Moody's review of GALC's rating initiated on 1 June 2020. Avolon's ratings and negative outlook are not affected by this action. Downgrade: Issuer: Global Aircraft Leasing Co., Ltd. Senior Unsecured Regular Bond/Debenture (Foreign Currency), Downgraded to B1 from Ba2 Outlook Action: Issuer: Global Aircraft Leasing Co., Ltd. Outlook, Changed to Negative from Rating Under Review RATINGS RATIONALE Moody's downgraded GALC's senior notes based on the heightened financial performance challenges of GALC's parent Bohai and its controlling shareholder HNA Group (HNA) since the onset of the coronavirus pandemic. Moody's believes that the Bohai and HNA's credit profiles have weakened, increasing GALC's governance related risks. The coronavirus pandemic resulted in a significant decline in air travel volumes, reducing the earnings and cash flows of airlines globally, including the 13 airlines operated by HNA. While air travel volumes have improved in China (A1 stable), travel in other regions in which HNA's airlines operate remains weak. The working group led by the Hainan Provincial Government has been established to resolve the group's increasing financial difficulties mainly caused by the additional pressure on its key businesses as a result of the coronavirus outbreak. Until a plan from the team is agreed and implemented, Moody's expects that HNA will continue to face significant liquidity challenges relating to accessing capital to refinance the group's maturing debt and meeting other financial obligations. Moody's also understands Bohai to be experiencing liquidity challenges relating to access to debt capital, resulting in creditor's needing to make accommodations with respect to a recent debt maturity. GALC has higher governance risks than Avolon, which contributes to GALC having a higher probability of default. Avolon's governance risks relating to Bohai and HNA became less prominent credit constraints after ORIX Corporation (A3 negative) acquired a 30% interest in Avolon in November 2018. A partial offset to GALC's heightened governance risks are terms in GALC's senior notes agreement that require redemption of the notes if certain limits regarding restricted shareholder payments are exceeded. The interest payments on the notes are serviced by cash from dividends paid by Avolon, but should cash be insufficient, the notes include a payment in kind (PIK) toggle, which allows GALC to capitalize interest expense. GALC elected to PIK its September interest payment. Given prospects for lower earnings and cash flow at Avolon, due to the weakened airline industry, Moody's believes it possible that additional coupon payments could be capitalized. The notes also include restrictive provisions relating to additional debt and liens, permitted investments, change of control and asset sales. GALC's senior unsecured debt rating also incorporates the structural subordination of GALC's creditors to Avolon's creditors. Structural subordination elevates the loss severity of GALC's senior creditors in the event of default compared to Avolon's senior creditors. The negative outlook reflects Moody's expectation of a more extended and weaker recovery in air travel that results in higher risks to earnings, cash flow, liquidity and capital positions, over the next 12-18 months, as well as the weakened financial condition of GALC's parent entities Bohai and HNA Group. Moody's regards the coronavirus outbreak as a social risk under its ESG framework, given the substantial implications for public health and safety. The rating action reflect the negative effects on GALC of the breadth and severity of the shock, and the deterioration in credit quality, profitability, capital and liquidity it has triggered. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING Moody's could upgrade GALC's rating if: 1) Avolon's ratings are upgraded due to an improvement in its intrinsic credit profile; 2) Bohai's credit profile improves further due to lower leverage and strengthened liquidity; or 3) GALC's governance risks decline. Moody's could downgrade GALC's rating if: 1) Avolon is downgraded, 2) Bohai's leverage increases, its liquidity weakens, or its earnings materially diminish; or 3) GALC's cushion with respect to its bond covenants materially deteriorates. The principal methodology used in this rating was Finance Companies Methodology published in November 2019. GNC HOLDINGS: Court OKs Settlement With Creditors on Sale to Harbin ------------------------------------------------------------------- Leslie A. Pappas of Bloomberg Law reports that GNC Holdings Inc. won approval of its global settlement with creditors, clearing a path to wind down its Chapter 11 bankruptcy. The settlement, filed in September, resolved disputes with GNC's unsecured creditors and lender groups over the company's $770 million sale to Harbin Pharmaceutical Group Holding Co., its largest shareholder before bankruptcy. The sale closed Oct. 7, 2020, according to company court documents filed Thursday in the U.S. Bankruptcy Court for the District of Delaware. Creditors had objected the sale as originally proposed, saying it wouldn't provide them adequate recovery. Unsecured creditors also opposed what they called a "death trap." About GNC Holdings GNC Holdings Inc. -- http://www.gnc.com/-- 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. 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. The 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. GRAY TELEVISION: S&P Rates New $550MM Senior Unsecured Notes 'B+' ----------------------------------------------------------------- S&P Global Ratings assigned its 'B+' rating to Gray Television Inc.'s proposed $550 million senior unsecured notes due 2030. The '4' recovery rating indicates its expectation for average (30%-50%; rounded estimate: 30%) recovery in the event of payment default. The company intends to use the proceeds from these notes to redeem its existing $525 million senior unsecured notes due 2024. The proposed transaction does not materially affect leverage, and it enhances the company's debt-maturity profile. Gray Television's average trailing eight-quarter leverage was 5.7x as of June 30, 2020. S&P expects that Gray's leverage will remain around 5.75x in 2020 as record political advertising revenue and retransmission revenue growth offset a slow recovery to core advertising revenues. Issue Ratings - Recovery Analysis Key analytical factors -- Gray Television is the borrower of a senior secured credit facility ($200 million revolving credit facility maturing in 2024, $641 million B-2 term loan maturing in 2024 [$595 million outstanding], and $1.4 billion C term loan maturing in 2026 [$1.19 billion outstanding]) and senior unsecured notes ($700 million 5.875% notes due in 2026, $750 million 7% notes due in 2027, and new $550 million notes due in 2030). -- The senior secured debt is guaranteed by the company's material domestic subsidiaries and is secured by substantially all of the company's assets and those of its guarantors (excluding real estate). Simulated default assumptions -- S&P's simulated default scenario contemplates a default in 2024 due to a combination of the following factors: increased competition from alternative media, a prolonged decline in advertising revenue due to economic weakness, failure to generate retransmission revenue commensurate with its local market and relevant television networks, and pressure from affiliated networks to remit a significant portion of retransmission fees. -- S&P's default assumptions include an 85% draw on the revolving credit facility, LIBOR is 2.5%, the spread on the revolving credit facility rises to 5% as covenant amendments are obtained, and all debt includes six months of prepetition interest. -- S&P has valued Gray on a going-concern basis using a 7x multiple of its projected emergence EBITDA, which is in line with that of other large television broadcasters it rates. Simplified waterfall -- EBITDA at emergence: about $405 million -- EBITDA multiple: 7x -- Gross enterprise value: about $2.9 billion -- Net enterprise value (after 5% administrative costs): about $2.7 billion -- Estimated senior secured debt claims: about $2.0 billion -- Value available for senior secured debt: about $2.7 billion -- Recovery expectations: 90%-100% (rounded estimate: 95%) -- Estimated senior unsecured debt claims: about $2.1 billion -- Value available for senior unsecured debt: about $695 million -- Recovery expectations: 30%-50% (rounded estimate: 30%) GREAT WESTERN PETROLEUM: S&P Cuts ICR to 'CCC-'; Outlook Negative ----------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on Denver-based private exploration and production (E&P) company Great Western Petroleum LLC to 'CCC-' from 'CCC+'. S&P said, "At the same time, we are lowering our issue-level rating on the company's 9% senior unsecured notes due September 2021 to 'CCC' from 'B-'. Our '2' recovery rating remains unchanged, indicating our expectation for substantial (70%-90%; rounded estimate: 85%) recovery to creditors in the event of a payment default." "Our downgrade reflects the company's refinancing risk and less than adequate liquidity position. We believe Great Western is facing heightened refinancing risk due to its September 2021 debt maturity, depressed debt trading levels (recently around $0.56 on the dollar with a yield-to-worst of 76%), and the unsupportive conditions in the capital markets. The company has about $250 million of outstanding 9% senior unsecured notes due in September 2021. The company must repay or refinance this debt by March 2021 to avoid triggering the springing maturity on its RBL credit facility, which currently has $400 million outstanding. We believe the likelihood the company will announce a debt exchange or restructuring within the next 6 months is high." "We expect the company's liquidity to remain tight following the recent reduction in the size of its RBL facility. The borrowing base and elected commitment amount of Great Western's RBL credit facility was reduced to $485 million, from $600 million, during its recent RBL redetermination. The company had $400 million of outstanding borrowings under the facility as of Sept. 30, 2020, which leaves it with a minimal liquidity cushion and will likely limit its ability to continue its planned drilling program." "Although we expect Great Western's strong hedging program to provide some uplift relative to our oil price assumptions of $35 per barrel (bbl) for the remainder of 2020 and $45/bbl in 2021, we expect the company's free operating cash flow (FOCF) generation to be limited to about $40 million-$50 million over the next 12 months." "The negative outlook reflects our anticipation that Great Western will likely engage in a debt exchange or restructuring we would consider to be distressed given its limited access to the capital markets, the depressed trading levels of its debt, and its less than adequate liquidity, which is compounded by the upcoming maturity of about $250 million of debt in September 2021 as well as the potential springing maturity of its RBL credit facility in March. We expect the company to report funds from operations (FFO) to debt of about 35% over the next 12 months supported by its hedging program." "We could lower our rating on Great Western if it engages in a debt restructuring or exchange that we consider to be distressed." "We could raise our rating on Great Western if we no longer believe it will engage in a distressed transaction in the near term. This would most likely occur if the company refinances its notes maturing in September 2021 at par ahead of the March 2021 springing maturity on its RBL facility." GULFPORT ENERGY: S&P Downgrades ICR to 'CCC-'; Outlook Negative --------------------------------------------------------------- S&P Global Ratings downgraded Gulfport Energy Corp.'s credit rating to 'CCC-' from 'CCC+'. S&P also lowered the ratings on the company's unsecured notes to 'CCC-' from 'CCC+', with a recovery rating of '3'. The downgrade of Gulfport Energy Corp. reflects increased refinancing risk. Gulfport's revolving credit facility matures in December 2021 and becomes current this year. It is S&P's belief the company will be challenged to amend and extend its facility given the company's leverage profile and because oil and gas companies have limited access to capital markets. S&P said, "We view Gulfport's liquidity as less than adequate. As of June 30, the company had $256 million of liquidity available including $3 million of cash, and approximately $253 million available on its $700 million revolving credit facility. However, we could see an additional decline in the borrowing base during the fall redetermination. Additionally, there is the potential for the company to breach its covenants in the coming quarters." "We believe there is heighted risk that the company could execute a distressed exchange or some form of debt restructuring. Given Gulfport's upcoming maturities and interest payments, we think there is increased risk that the company could skip its interest payment and use the grace period to negotiate with its creditors. It is S&P's view that the company could execute some sort of restructuring plan or distressed exchange in the near-term." "The negative outlook on Gulfport Energy Corp. reflects our view of an increasing risk that the company could enter a transaction that we could view as distressed or the potential that it might execute a debt restructuring. Gulfport's credit facility comes due in December 2021 and we think it will face challenges amending and extending the facility under current conditions. Additionally, the company has upcoming interest payments and we think it could elect to negotiate with its lenders." "We could lower the rating if the company misses its interest payments, announces a transaction that we would view as distressed, or executes a restructuring plan. "We could amend the ratings if the company is able to amend and extend its credit facility on favorable terms and liquidity improves such that it is no longer a risk." HAH GROUP: S&P Assigns 'B-' Issuer Credit Rating; Outlook Stable ---------------------------------------------------------------- S&P Global Ratings assigned a 'B-' issuer credit rating to Illinois-based HAH Group Holding Co. LLC (d/b/a Help at Home LLC) at Home. The outlook is stable. S&P said, "We are also assigning a 'B-' issue-level rating and '3' recovery to the company's first-lien facility, consisting of a $74 million revolving credit facility, a $440 million first-lien term loan, a $75 million first-lien delayed-draw term loan (undrawn), and a $65 million first-lien delayed-draw term loan (undrawn). The '3' recovery rating indicates our expectation for meaningful recovery (50%-70%; rounded estimate: 55%) of principal in the event of default." "We are assigning a 'CCC' rating with a '6' recovery rating to the company's $165 million second-lien term loan." "The stable outlook reflects our expectation that the company is well positioned to benefit from the growing demand for home care services, especially as state Medicaid programs recognize the overall cost-savings through preventive home care services. We expect the company will realize steady revenue growth and operating margins." "Our ratings on Help at Home reflect the company's narrow focus, significant geographic concentration, and exposure to state Medicaid programs. The home care services industry is highly fragmented, with below-average profitability compared with other sectors of the health services industry. This is partially offset by the company's good scale in the markets its operates in, solid profitability relative to direct peers, strong relationships with referring agencies, a flexible cost structure with mostly variable costs, and limited requirements for capital expenditures." The ratings on Help at Home reflect its relatively narrow focus as a provider of home-based personal care services (84% of 2019 total revenue), although it has additional lines of operations in home health and community living services. The home care market is very competitive and fragmented, with only modest potential for differentiation and limited barriers to entry. The company is exposed to modest reimbursement risk, particularly with regard to timing, that could strain liquidity. The company is heavily reliant on Medicaid waivers and managed care organizations (MCOs) for over 90% of its revenues. Despite COVID-19-related pressures to state budgets, S&P expects state-based health care payments will be uninterrupted, although they may be delayed by up to three to four months. The company currently has substantial concentration in its top three states, with 43% of revenues in Illinois, 28% in Pennsylvania, and 10% in Indiana. Offsetting strengths are the company's scale, market leadership position, and record for quality. The company is the largest provider of home care services nationally, surpassing the home care revenues of rated Pluto Acquisition I (d/b/a AccentCare)and publicly traded companies Addus (not rated), LHC Group (not rated), and Amedisys (not rated). The company has the leading market position in six states, and an emerging presence in seven others. S&P believes the company's almost exclusive focus on home care has contributed to lower employee turnover, above-average customer satisfaction, and has supported easier referrals and a preferred provider status versus competitors that focus more substantially on home health and hospice services. S&P said, "We expect that Help at Home's adjusted debt leverage will be about 5.8x-6.1x in 2020 and 2021 based on our forecast. Given financial sponsor ownership, we expect leverage will remain elevated above 6x for the next two years as the company prioritizes acquisitions over deleveraging." "The stable outlook reflects our expectation that the company will likely benefit from growing demand for home care services, and will be able to scale while maintaining relatively stable margins and free cash flow generation. We expect the company will keep adjusted leverage above 5x for at least the next year." "Although unlikely over the next 12 months, we could consider a lower rating if we expect EBITDA margins to contract by about 150 basis points (bps), resulting in sustained material cash flow deficits and leverage sustained materially above 7x that would lead us to believe the capital structure is unsustainable. This scenario could occur as a result of increased competition or rate cuts from Medicaid payors." "We could consider a higher rating if we expect Help at Home to sustain free cash flow (after mandatory shareholder distributions) above 3% of debt (about $19 million) and demonstrates stable days receivables outstanding through its growth. Alternatively, we could raise the rating if we expect the company to maintain leverage below 5x."w HAJ PETROLEUM: Has Until Oct. 26 to File Plan & Disclosures ----------------------------------------------------------- Judge Donald R. Cassling of the U.S. Bankruptcy Court for the Northern District of Illinois, Eastern Division, has entered an order within which the deadline for Debtor Haj Petroleum Inc. to file a plan and disclosure statement is extended through and until October 26, 2020. A full-text copy of the order dated August 25, 2020, is available at https://tinyurl.com/yy7cczwu from PacerMonitor.com at no charge. The Debtor is represented by: Richard N. Golding, Esq. THE GOLDING LAW OFFICES, P.C. 500 N, Dearborn Street, 2nd Floor Chicago, IL 60654 Tel: (312) 832-7885 Fax: (312) 755-5700 E-mail: rgolding@goldinglaw.net About Haj Petroleum Haj Petroleum, Inc., owns and operates a gasoline station in South Elgin, IL. Haj Petroleum 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 disclosed $46,740 in assets and $1,100,114 in liabilities. Richard N. Golding, Esq. at THE GOLDING LAW OFFICES, P.C., represents the Debtor. HEALTH ASSET: Case Summary & 10 Unsecured Creditors --------------------------------------------------- Debtor: Health Asset Management, Inc. d/b/a Paper Tracer Software Systems 11250 Old St. Augustine Road Suite #15-134 Jacksonville, FL 32257 Business Description: Health Asset Management, Inc. -- https://papertracer.com -- is a computer software provider headquartered in Jacksonville, Florida. The Company developed PaperTracer, a software that automates contracts by integrating paper and digital documents into a centralized database. Its tracking and reporting capabilities simplify audit procedures to support management and regulatory compliance requirements for workflow processes. Chapter 11 Petition Date: October 12, 2020 Court: United States Bankruptcy Court Middle District of Florida Case No.: 20-03000 Debtor's Counsel: Robert D. Wilcox, Esq. WILCOX LAW FIRM 1301 Riverplace Blvd., Suite 800 Jacksonville, FL 32207 Tel: 904-405-1250 Email: rw@wlflaw.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Marilyn E. Tarpley, president. A copy of the petition containing, among other items, a list of the Debtor's 10 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/WL5BKJQ/Health_Asset_Management_Inc__flmbke-20-03000__0001.0.pdf?mcid=tGE4TAMA HERMITAGE OFFSHORE: Lenders Get 10 PSVs, 3rd Party Gets 10 Vessels ------------------------------------------------------------------ Hermitage Offshore Services Ltd. (HOFSQ:OTC) announced Oct. 12, 2020, the selection of the successful bids for the Company's vessels pursuant to the bankruptcy procedures under Chapter 11 of the U.S. Bankruptcy Code. As part of the bid process, the Company's lenders submitted the highest bid of approximately $80 million in aggregate for the Company's ten platform supply vessels (the "PSVs") and the Company has determined that this was the successful bid for the PSVs. The lenders' successful bid for the PSVs constitutes a "credit bid" against the Company's outstanding indebtedness and will not result in the receipt of any cash consideration by the Company. The Company's eleven crew vessels will be sold to an unaffiliated third party that submitted a successful bid of approximately $5.3 million in cash, in aggregate. The sale of the vessels remains subject to final approval of the bankruptcy court and definitive documentation between the Company and the prospective purchasers. About Hermitage Offshore Bermuda-based Hermitage Offshore Services Ltd. (previously Nordic American Offshore Ltd.) -- http://www.hermitage-offshore.com/-- is an offshore support vessel company that owns 23 vessels consisting of 10 platform supply vessels, or PSVs, two anchor handling tug supply vessels, or AHTS vessels, and 11 crew boats. The Company's vessels primarily operate in the North Sea or the West Coast of Africa. The Debtors' OSVs are all focused on, and used primarily in, the oil and gas business, including in the installation, maintenance, and movement of oil and gas platforms. Demand for the Debtors' services, as well as its operations, growth, and stability in the value of the OSVs depend on activity in offshore oil and natural gas exploration, development, and production. Hermitage Offshore Services Ltd. (Lead Debtor) (Bankr. S.D.N.Y. Case No. 20-11850) and 20 affiliates sought Chapter 11 protection on Aug. 11, 2020. The cases are assigned to Judge Martin Glenn. In the petitions signed by Cameron Mackey, director, the consolidated cases estimated assets and liabilities in the range of $100 million to $500 million. The Debtors tapped Brian S. Rosen, Esq., and Joshua A. Esses, Esq., at Proskauer Rose LLP as counsel. The Debtors tapped Perella Weinberg Partners L.P. as their Investment Banker. They tapped Napdragon Advisory AB as their Professional Shipping Advisory Firm. Prime Clerk LLC serves as the Debtors' claims, noticing and solicitation agent. HI-CRUSH INC: Bankruptcy Court Confirms Exit Plan ------------------------------------------------- Judge David R. Jones has entered an order that the Plan of Hi-Crush Inc., et al. is approved and confirmed in its entirety under section 1129 of the Bankruptcy Code. Section 1129(a)(8) of the Bankruptcy Code requires that each class of claims or interests must either accept a plan or be unimpaired under a plan. The Holders of Other Priority Claims (Class 1), Other Secured Claims (Class 2), Secured Tax Claims (Class 3), and Old Affiliate Interests in any Parent Subsidiary (Class 7) are Unimpaired and, thus, under section 1126(f) of the Bankruptcy Code, are conclusively presumed to have accepted the Plan. The Holders of Intercompany Claims (Class 6), though Impaired, are conclusively presumed to have accepted the Plan. The Holders of Prepetition Notes Claims (Class 4) and Holders of General Unsecured Claims (Class 5) have voted to accept the Plan in accordance with section 1126 of the Bankruptcy Code. The Holders of Old Parent Interests (Class 8) are deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code. Although section 1129(a)(8) of the Bankruptcy Code is not satisfied with respect to rejecting Class 8, the Plan may nevertheless be confirmed because the Plan satisfies section 1129(b) of the Bankruptcy Code with respect to rejecting Class 8. Article IV.E of the Plan contemplates the non-consensual Confirmation of the Plan. The Prepetition Notes Claims (Class 4) and General Unsecured Claims (Class 5) are Impaired Classes of Claims that have voted to accept the Plan in accordance with section 1126(c) of the Bankruptcy Code, determined without including any acceptance of the Plan by "insiders," thereby satisfying Section 1129(a)(10) of the Bankruptcy Code. The Holders of Old Parent Interests (Class 8) are deemed to have rejected the Plan (the "Rejecting Class"). The evidence proffered or adduced at the Confirmation Hearing (i) is reasonable, persuasive, and credible, (ii) utilizes reasonable and appropriate methodologies and assumptions, (iii) has not been controverted by other evidence, and (iv) establishes that the Plan does not discriminate unfairly, and is fair and equitable, with respect to the Rejecting Class, as required by sections 1129(b)(1) and (b)(2) of the Bankruptcy Code, because no Holder of any interest that is junior to the Claims and Equity Interests represented by the Rejecting Class will receive or retain any property under the Plan on account of such junior interest, and no Holder of a Claim in a Class senior to the Rejecting Class is receiving more than 100% recovery on account of its Claim. Thus, the Plan may be confirmed notwithstanding the rejection of the Plan by the Rejecting Class. With respect to the Allowed Claims of Midland Central Appraisal District, Kermit Independent School District, Midland County, Howard County Tax Office, Harris County, Cypress-Fairbanks ISD, and Ector CAD (the "Texas Taxing Authorities," and such Allowed Claims, the "Texas Taxing Authority Claims"), (a) to the extent the Texas Tax Code provides for interest and/or penalties with respect to any portion of the Texas Taxing Authority Claims, nothing in the Plan or this Confirmation Order prevents the inclusion of such interest and/or penalties in the Texas Taxing Authority Claims, and the Debtors' defenses and rights to object to such Claims or to the inclusion of such interest or penalties in such Claims are fully preserved, (b) to the extent the Texas Taxing Authority Claims constitute Allowed Secured Claims against the Debtors, the liens securing the Texas Taxing Authority Claims shall be retained until the applicable Texas Taxing Authority Claims are paid in full, and (c) the Debtors or the Reorganized Debtors, as applicable, shall pay any Allowed Texas Taxing Authority Claims on the later of (i) the date the Texas Taxing Authority Claims become due pursuant to the Texas Tax Code (subject to any applicable extensions, grace periods, or similar rights under the Texas Tax Code) and (ii) the Effective Date. All rights and defenses of the Debtors and the Reorganized Debtors under non-bankruptcy law are reserved and preserved with respect to such Texas Taxing Authority Claims. The Texas Taxing Authorities' lien priority shall not be primed or subordinated by any Exit Financing approved by the Court in conjunction with the Confirmation or Consummation of this Plan. Reorganized Debtor shall have sixty (60) days from the later of (i) the Effective Date and (ii) the date of the filing of the Proof of Claim on account of the Texas Taxing Authority Claims, to object to the Texas Taxing Authority Claims; otherwise, said claims shall be deemed as an allowed claim in the amount of their last filed Proofs of Claims. Notwithstanding any provision in the Plan or this Order to the contrary, the Texas Taxing Authorities may amend their respective Proofs of Claims once the current year ad valorem taxes are actually assessed without further agreement with the Reorganized Debtor or leave of Court for approval to amend their Claims. The Debtors and the Reorganized Debtors reserve all their defenses and rights to object to such amended Proofs of Claims. On the Effective Date, the Debtors shall assume that certain Information Services Subscription Agreement, dated as of March 26, 2019 between the Debtors and RS Energy Group, Inc. ("RS Energy," and such agreement, the "RS Energy Agreement"). The cure amount in connection with the assumption of the RS Energy Agreement shall be $19,987.50 (the "RS Energy Cure Amount"), as agreed to by the Debtors and RS Energy. The Debtors shall pay the RS Energy Cure Amount to RS Energy within thirty (30) days of entry of this Confirmation Order. Nothing in this Confirmation Order or the Plan (and neither the confirmation nor consummation of the Plan) shall eliminate, alter or impair any of the objections of EOG Resources Inc. ("EOG") set forth in EOG Resources Inc.'s Objection to Assumption of Sand Purchase Agreement (the "EOG Objection") [Docket No. 386], including, but not limited to EOG's position that the Sand Purchase Agreement dated February 13, 2017, as amended (the "Sand Purchase Agreement"), was properly terminated prior to the Petition Date. The Debtors' rights, defenses, and arguments with respect to any of the objections raised in the EOG Objection are hereby fully preserved, and any affirmative claims or causes of action the Debtors' maintain against EOG shall constitute Retained Causes of Action under the Plan. All of EOG's defenses, arguments or appellate rights to the extent related to the proposed assumption of the Sand Purchase Agreement are hereby preserved and are not being determined at this time, but shall be adjudicated by the Court at a later date with the rights, defense and arguments of each party to such dispute hereby full preserved. Licensors Entry of the Confirmation Order shall constitute approval of the rejection of that certain License Agreement, dated January 23, 2020 (the "License Agreement"), by and among Debtor Hi-Crush, Inc. ("Hi-Crush"), Bowlin Enterprises, LLC ("Bowlin") and Endeco Engineers, LLC (together with Bowlin, the "Licensors"). The Licensors shall be deemed to opt-out of the Third Party Release set forth in Article X.B.2 of the Plan. Nothing in the Plan or this Confirmation Order shall limit the rights of the Licensors to (i) issue notices to Debtors and Reorganized Debtors (as applicable), their officers, agents, employees or representatives, solely to the extent the Licensors are required to issue such notices regarding termination of the License Agreement and requiring the return or destruction of documents and information set forth in the License Agreement; (ii) to take action to preserve and protect Confidential Information, Licensed Proprietary Technology, Licensed Know-How, Licensed Patents, and Licensed Products (each as defined in the License Agreement) including, but not limited to, the right to enforce any duties incumbent upon Hi-Crush under the License Agreement which may survive the rejection thereof, which may include: (1) the immediate cessation by Hi-Crush (and its affiliates) of any activities concerning, including any practice and use of, the Licensed Patents and Licensed Know-How (except as otherwise provided in the License Agreement, including the continued use of the Licensed Patents or Licensed Know-How as provided under the License Agreement, including such uses that are needed (A) to continue to operate any Paid-Up Plants and (B) to complete the manufacture of the Licensed Products during the Sell-Off period (as such term is defined under the License Agreement) so long as with respect to this sub-clause (B) the Licensors receive the applicable royalty payment pursuant to the License Agreement related to the Licensed Products completed during the Sell-Off period); (2) except as otherwise provided in the License Agreement, cessation by Hi-Crush of the use of any Licensed Proprietary Technology, Licensed Know-How, Licensed Patents, and Licensed Products in the construction of Plants; (3) the return or destruction by Hi-Crush (or Reorganized Debtors, as applicable) of any documents and tangible materials (and any copies) containing, reflecting, incorporating or based on Bowlin's Confidential Information (except as permitted under the License Agreement); and (4) a certification in writing to Bowlin that Hi-Crush has complied with the foregoing requirements in (1)-(3) and other requirements under the License Agreement; and (iii) bring suit, claims and causes of action, in law or in equity, against Debtors or Reorganized Debtors (as applicable), and present, past, or future agents, employees and representatives of these entities, as well as all other parties, to enforce any rights and remedies under the License Agreement and applicable non-bankruptcy law that relate to the misappropriation of the aforementioned confidential and proprietary information and actions arising from any attempt by the above-referenced parties to, except as otherwise provided in the License Agreement, continue construction on any Plant or initiate construction on a new Plant using the Licensed Proprietary Technology, Licensed Know-How, Licensed Patents, and Licensed Products, after the termination of the License Agreement (such suit, claims or causes of action, "Infringement Actions"); provided; that (x) any Infringement Actions arising from conduct that occurred prior to the Effective Date shall constitute General Unsecured Claims or Administrative Claims, as applicable, under the Plan, and (y) any Infringement Actions arising from conduct occurring post-Effective Date shall constitute actions against the Reorganized Debtors that shall be addressed in the ordinary course of business. Any claim for monetary damages asserted by Licensors against Debtors' estates arising from the rejection of the License Agreement shall be determined pursuant to the Plan; provided, that the Licensors reserve the right to bring any Infringement Action in any court of competent jurisdiction; provided, further, all procedural and substantive rights related to any Infringement Action are preserved by the Debtors or Reorganized Debtors, as applicable, and the Licensors. To the extent that it may apply after the Effective Date, the automatic stay shall not apply to any Infringement Action or action by Licensors to enforce any rights or remedies under the License Agreement related to matters arising from acts or omissions of Debtors and Reorganized Debtors (as applicable), or their officers, agents, employees or representatives. The Debtors' and the Reorganized Debtors', as applicable, defenses, counterclaims, and rights to object to any claim, suit, or cause of action brought by Licensors is hereby fully reserved and preserved. About Hi-Crush Inc. Hi-Crush Inc. -- http://www.hicrushinc.com/-- is a fully-integrated provider of proppant and logistics services for hydraulic fracturing operations, offering frac sand production, advanced wellsite storage systems, flexible last mile services, and innovative software for real-time visibility and management across the entire supply chain. The Company's strategic suite of solutions provides operators and service companies in all major U.S. oil and gas basins with the ability to build safety, reliability and efficiency into every completion. Hi-Crush and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 20-33495) on July 12, 2020. As of March 31, 2020, Debtors had total assets of $953.082 million and total liabilities of $699.137 million. Judge David R. Jones oversees the cases. The Debtors tapped Hunton Andrews Kurth LLP and Latham & Watkins LLP as their legal counsel, Alvarez & Marsal North America LLC as financial advisor, and Lazard Freres & Co. LLC as investment banker. Kurtzman Carson Consultants LLC is the claims and noticing agent and solicitation agent. HI-CRUSH INC: Emerges from Chapter 11 Bankruptcy ------------------------------------------------ Hi-Crush Inc. (OTCMKTS: HCRSQ), a provider of proppant logistics solutions, announced that effective October 9, 2020, the Company has successfully completed its financial restructuring and emerged from Chapter 11 bankruptcy, having satisfied all of the conditions to the effectiveness of its plan of reorganization. Through its financial restructuring, Hi-Crush has eliminated approximately $450 million of debt from its balance sheet, as well as more than $76 million of annual interest expense and lease payment obligations. Effective today, Hi-Crush has entered into a new $25 million Senior Secured Asset Based Loan (the "ABL"), and paid off outstanding amounts under its debtor-in-possession term loan with proceeds from a $43 million equity rights offering. The Company's post-emergence cash balance is approximately $35 million. New Board of Directors In accordance with the Plan, the Company appointed a newly constituted Board of Directors. The new Board consists of Colin Leonard, Brad Kottman, Jacob Mercer, and Marc Rowland, in addition to Robert E. Rasmus, Hi-Crush's Chief Executive Officer. Additional information about the Company's new directors may be found on Hi-Crush's website at www.hicrush.com. Issuance of New Securities Effective immediately, all existing shares of the Company's common stock were cancelled pursuant to the Plan, and the Company issued 9,382,378 shares of New Common Stock pro rata to the holders of allowed claims arising under the Prepetition Notes. Additionally, the Company is authorized to issue up to an additional 4,262,836 shares of New Common Stock to holders of general unsecured clams pursuant to, and in accordance with, the terms and conditions of the Plan as such holders' general unsecured claims become allowed under the Plan. The New Common Stock will not be traded on a public exchange. Advisors Lazard acted as investment banker, Latham & Watkins LLP acted as legal counsel, and Alvarez & Marsal acted as restructuring advisor to Hi-Crush Inc. Moelis & Company acted as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal advisor to certain holders of Hi-Crush Inc.'s senior unsecured notes. For More Information Additional details of the Plan, the new ABL, and the New Common Stock can be found in the Company's prior filings with the SEC, as well as in a Current Report on Form 8-K to be subsequently filed with the SEC on or around October 9, 2020. You may obtain these documents for free by visiting EDGAR on the SEC website at www.sec.gov This press release does not constitute an offer to sell or purchase any securities, which would be made only pursuant to definitive documents and an applicable exemption from the Securities Act of 1933, as amended. About Hi-Crush Hi-Crush Inc. is a fully-integrated provider of proppant and logistics services for hydraulic fracturing operations, offering frac sand production, advanced wellsite storage systems, flexible last mile services, and innovative software for real-time visibility and management across the entire supply chain. Hi-Crush and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 20-33495) on July 12, 2020. As of March 31, 2020, Debtors had total assets of $953.082 million and total liabilities of $699.137 million. Judge David R. Jones oversees the cases. The Debtors tapped Hunton Andrews Kurth LLP and Latham & Watkins LLP as their legal counsel, Alvarez & Marsal North America LLC as financial advisor, and Lazard Freres & Co. LLC as investment banker. Kurtzman Carson Consultants LLC is the claims and noticing agent and solicitation agent. HI-CRUSH INC: Unsecureds to Get Part of Equity in Plan ------------------------------------------------------ Hi-Crush Inc., et al. submitted a Joint Plan of Reorganization. Upon entry of the Final DIP Order, and pursuant to the Final DIP Order, the Prepetition Credit Agreement Claims were deemed outstanding under the DIP ABL Facility and constitute DIP ABL Facility Claims. On the Effective Date, the Allowed DIP ABL Facility Claims will, in full satisfaction, settlement, discharge and release of, and in exchange for such DIP ABL Facility Claims, be indefeasibly paid in full in Cash from the proceeds of the Exit Facility, and any unused commitments under the DIP ABL Loan Documents and the outstanding letters of credit thereunder shall be deemed outstanding under the Exit ABL Facility or, if necessary, be cash collateralized at 105% of such outstanding amount as of the Effective Date and remain outstanding. Class 4 Prepetition Notes Claims are impaired. Each Holder of an Allowed Class 4 Claim shall receive, in full satisfaction, settlement, discharge and release of, and in exchange for, such Allowed Class 4 Claim its Pro Rata share of the Subscription Rights in accordance with the Disclosure Statement Order and the Rights Offering Procedures and 100% of the New Equity Interests Pool, shared Pro Rata with the Holders of Allowed General Unsecured Claims. Class 5 General Unsecured Claims are impaired. Each Holder of an Allowed Class 5 Claim shall receive, in full satisfaction, settlement, discharge and release of, and in exchange for, such Allowed Class 5 Claim its Pro Rata share of the Subscription Rights in accordance with the Disclosure Statement Order and the Rights Offering Procedures and 100% of the New Equity Interests Pool, shared Pro Rata with the Holders of Allowed Prepetition Notes Claims. Class 8 Old Parent Interests are impaired. The Old Parent Interests will be cancelled without further notice to, approval of or action by any Person or Entity, and each Holder of an Old Parent Interest shall not receive any distribution or retain any property on account of such Old Parent Interest. All Cash necessary for the Debtors or the Reorganized Debtors, as applicable, to make payments required pursuant to this Plan will be obtained from their respective Cash balances, including Cash from operations, the Exit Facility, and the Rights Offering. A full-text copy of the Joint Plan of Reorganization dated September 23, 2020, is available at https://tinyurl.com/yyrsxu7b from PacerMonitor.com at no charge. Proposed Counsel for the Debtors: Timothy A. Davidson II Ashley L. Harper HUNTON ANDREWS KURTH LLP 600 Travis Street, Suite 4200 Houston, Texas 77002 Telephone: (713) 220-4200 Facsimile: (713) 220-4285 George A. Davis Keith A. Simon David A. Hammerman Annemarie V. Reilly Hugh K. Murtagh LATHAM & WATKINS LLP 885 Third Avenue New York, New York 10022 Telephone: (212) 906-1200 Facsimile: (212) 751-4864 About Hi-Crush Inc. Hi-Crush Inc. -- http://www.hicrushinc.com/-- is a fully-integrated provider of proppant and logistics services for hydraulic fracturing operations, offering frac sand production, advanced wellsite storage systems, flexible last mile services, and innovative software for real-time visibility and management across the entire supply chain. The Company's strategic suite of solutions provides operators and service companies in all major U.S. oil and gas basins with the ability to build safety, reliability and efficiency into every completion. Hi-Crush and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 20-33495) on July 12, 2020. As of March 31, 2020, Debtors had total assets of $953.082 million and total liabilities of $699.137 million. Judge David R. Jones oversees the cases. The Debtors tapped Hunton Andrews Kurth LLP and Latham & Watkins LLP as their legal counsel, Alvarez & Marsal North America LLC as financial advisor, and Lazard Freres & Co. LLC as investment banker. Kurtzman Carson Consultants LLC is the claims and noticing agent and solicitation agent. INTERNATIONAL ORANGE: Case Summary & 5 Unsecured Creditors ---------------------------------------------------------- Debtor: International Orange Spa, Inc. 2421 Lakspur Landing Circle Suite 43 Lakspur, CA 94939 Business Description: International Orange Spa, Inc. -- https://internationalorange.com -- is a San Francisco spa offering facials, massage, acupuncture, and organic skin and body care. Chapter 11 Petition Date: October 11, 2020 Court: United States Bankruptcy Court Northern District of California Case No.: 20-30812 Judge: Hon. Hannah L. Blumenstiel Debtor's Counsel: Michael St. James, Esq. ST. JAMES LAW, PC 22 Battery Street, Suite 888 San Francisco, CA 94111 Tel: (415) 391-7568 Email: michael@stjames-law.com Total Assets: $756,842 Total Liabilities: $2,626,865 The petition was signed by Melissa Ferst, president. A copy of the petition containing, among other items, a list of the Debtor's five unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/MDWUQQA/International_Orange_Spa_Inc__canbke-20-30812__0001.0.pdf?mcid=tGE4TAMA INTERSTATE COMMODITIES: U.S. Trustee Appoints Creditors' Committee ------------------------------------------------------------------ The U.S. Trustee for Region 2 appointed a committee to represent unsecured creditors in the Chapter 11 case of Interstate Commodities, Inc. The committee members are: 1. Infinity Transportation c/o Global Atlantic Equipment Management, LLC 1355 Peachtree Street NE, Suite 750 South Tower Atlanta, GA 30309 Attn: Jeffrey Edelman, Senior Vice President, Global Telephone (678) 904-6306 Email: jeff.edelman@gafg.com Email: brett.berlin@gafg.com 2. Atel Leasing Corporation 600 Montgomery Street, 9th Floor San Francisco, CA 94111 Attn: Johanna Johannesson, Associate General Counsel Telephone (415) 889-3232 Email: jjohannesson@atel.com 3. VTG Rail, Inc 103 W. Vandalia Street, Suite 200 Edwardsville, IL 62025 Attn: Henry Novell, Vice President Finance Telephone (480) 248-2457 Facsimile (888) 379-2347 Email: henry.novell@vtg.com Official creditors' committees serve as fiduciaries to the general population of creditors they represent. They may investigate the debtor's business and financial affairs. Committees have the right to employ legal counsel, accountants and financial advisors at a debtor's expense. About Interstate Commodities Interstate Commodities Inc. engages in the merchandise of commodities. It offers whole corn, soybean meal, soybeans, soy hulls, soyhull pellets, corn gluten meal, canola meal, sunflower meal, beet pulp pellets, citrus pulp pellets, and wheat. Interstate Commodities Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D.N.Y. Case No. 20-11139 on Aug. 26, 2020. Michael G. Piazza, chief operating officer, signed the petition. At the time of filing, the Debtor disclosed $12,558,336 in assets and $25,513,305 in liabilities. Judge Robert E. Littlefield Jr. oversees the case. Gerard R. Luckman, Esq., at Forchelli Deegan Terrana LLP, serves as Debtor's legal counsel. IT'SUGAR FL: Wins Okay of $4MM DIP Loan, Cash Collateral Use ------------------------------------------------------------ Bankruptcy Judge Robert A. Mark in Miami will conduct a hearing via Zoom conference on October 23 to consider final approval of the request of It'Sugar FL I LLC and its debtor-affiliates to obtain postpetition financing from SHL Holdings, Inc., and to utilize cash collateral in which SHL Holdings has an interest. The Debtors need the funds to continue operating in the ordinary course, preserve the value of the estate, preserve jobs and maintain operations. It'Sugar explains it is essential to the success of the Debtors' chapter 11 case that they obtain access to sufficient postpetition financing and use of Cash Collateral. The preservation of estate assets, the Debtors' continuing viability and its ability to reorganize successfully and maximize value for stakeholders depends heavily upon the approval of the relief requested. According to It'Sugar, given the impact that the Coronavirus pandemic and the restrictions imposed by states and municipalities on the Debtors' business operations, as well as the uncertainty of the Debtors' future resulting therefrom and the extreme time constraints facing the Debtors, the Debtors' range of realistic financing alternatives is extremely limited if not non-existent. The Debtors owe $6.2 million to SHL Holdings in prepetition secured loans. SHL has committed to provide up to $4 million in DIP financing. The DIP loan charges interest at LIBOR plus 1.5% and will have senior lien and superpriority administrative expense claim status. SHL's Postpetition Liens and Superpriority Claim will be subordinate to (i) the claims of retained professionals of the estates in this Case up to the amounts set forth in the Budget; (ii) unpaid fees and expenses of the United States Trustee and the Clerk of the Court. The Debtors say SHL is entitled to adequate protection in an amount equal to the aggregate diminution in the value of its interest in the Collateral including Cash Collateral as provided for under the Bankruptcy Code. SHL is entitled to further adequate protection, including a stipulation of Prepetition Liens and Debt, the allowance of SHL's secured claim, the granting of Replacement Liens (subordinate to the DIP Liens) on the Collateral, the reaffirmation of the Prepetition Guaranty and other Prepetition Loan Documents, and the payment of Fees and Expenses pursuant to section 506(b) of the Bankruptcy Code. A copy of the motion is available at https://bit.ly/34LnWyJ from PacerMonitor.com. A copy of the Interim Order is available at https://bit.ly/34Qkpz3 from PacerMonitor.com. About It'Sugar FL I LLC IT'SUGAR -- https://itsugar.com/ -- is a specialty candy retailer with 100 locations across the United States and abroad. It sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-20259-RAM) on September 22, 2020. The Debtor has up to $50,000 in assets and liabilities. Judge Robert A. Mark is assigned to the case. Michael S. Budwick, Esq., at Meland Budwick, P.A., serves as counsel to the Debtor. JIM'S DISPOSAL: Sets Bidding Procedures for Assets -------------------------------------------------- Jim's Disposal Service, LLC ("JDS"), and Byrdland Properties, LLC, ask the U.S. Bankruptcy Court for the Western District of Missouri to authorize the bidding procedures in connection with the sale of JDS' interest in the assets, consisting of a solid waste processing facility, a solid waste processing facility operating permit, and the trucks and equipment, to River Bend Recycling and Transfer, LLC for $4,623,800, subject to overbid. JDS is the sole record owner of a solid waste processing facility, or "Transfer Station," located at 17200 Industrial Drive, in the Village of River Bend, Missouri. Security Bank of Kansas City ("SBKC") asserts a valid and perfected first priority lien on and security interest in the Transfer Station pursuant to, among other loan and security documents, that certain Deed of Trust dated as of May 6, 2016, granted by Byrdland for the benefit of SBKC, recorded at Document Number 2016E0040017 with the Recorder of Deeds of Jackson County, Missouri, as amended, modified, or supplemented from time to time. JDS is the owner of a 21-year Solid Waste Processing Facility Operating Permit issued by the Missouri Department of Natural Resource to operate the Transfer Station. SBKC asserts a valid and perfected first priority lien on and security interest in the Permit pursuant to the loan and security documents, security agreements, UCC-1 financing statements, and other perfection documents attached to SBKC's proof of claim in this case, available at Claim No. 38 in JDS' claims register. JDS is the owner of an industrial scale located at the Transfer Station. Marlin Business Bank asserts a valid and perfected first priority lien on and security interest in the Scale pursuant to the loan and security document, UCC-1 financing statement, and other perfection documents attached to SBKC's proof of claim in the case, available at Claim No. 60 in JDS' Claims Register. JDS also is the owner of the Assets as defined in the Asset Purchase Agreement as more fully defined in the Asset Sale Agreement. By the Motion, JDS asks the Court sets an Auction and Hearing to approve the sale of the Assets or some portion of the Assets free and clear of liens, claims, and encumbrances, and with the remaining proceeds of the sale to be distributed in accordance with the Motion. JDS explored marketing the Assets through a broker and through trade magazines but was counseled by industry professionals against either. In lieu of a formal marketing campaign, JDS reached out to industry insiders to discuss the sale of the Permit and Transfer Station, which ultimately yielded the Asset Purchase Agreement. Other parties have expressed interest in the Assets. Accordingly, JDS believes an auction is in the best interests of the estate. The salient terms of the Bidding Procedures are: a. Bid Deadline: No later 5:00 p.m. (CST) on the day that is 45 days after the entry of the Bidding Procedures Order b. Initial Bid: The minimum initial overbid must be, in the aggregate, at least $100,000 greater than the Starting Auction Bid. JDS will also consider the impact of the Break-Up Fee and the potential costs of satisfying the conditions of any bid. c. Deposit: 5% of the purchase price proposed by the potential bidder d. Auction: If JDS determines, that it is in the best interests of its estate, an auction for Assets will take place on a date to be determined by the Court and set forth in the Bidding Procedures Order. e. Bid Increments: $25,000 f. Sale Hearing: The Sale Hearing will be held shortly following the Auction at a date and time established by the Court and set forth in the Bidding Procedures Order. g.Creditors asserting a valid and perfected, first priority security interest in the Assets or some portion of the Assets, will have the right to credit bid up to the total face value of its respective claim(s) on the Asset or portion of Assets securing its respective claim(s). Within three business days after entry of the Bidding Procedures Order, JDS will serve copies of the Bidding Procedures, the Bidding Procedures Order, and the Notice of Auction and Sale Hearing on the Notice Parties. Further, as soon as practicable after entry of the Bidding Procedures Order, JDS will submit the Notice of Auction and Sale Hearing in form annexed to the proposed Bidding Procedures Order as Exhibit 1 to be published in such publication as deemed appropriate by JDS, if any. The Sale Objection Deadline is seven days before the Sale Hearing. Under the Sale Order, the proceeds from the Sale will be used to pay the following, in order: (a) First, to the costs of sale, including postage, advertising, and escrow or closing fees; (b) Second, to holders of perfected first priority liens secured by the Assets or any portion of the Assets, up to the amount of their allowed secured claims; (c) Third, to any other valid lienholders holding perfected liens secured by the Assets or any portion of the assets in order of priority, up to the value of the Assets or portion of Assets securing their respective claim(s); and (d) Fourth, to JDS' bankruptcy estate. In connection with the Proposed Sale, the Successful Bidder may desire to take assignment of and assume certain executory contracts and/or leases related to the Assets. Accordingly, within seven business days after the entry of the Sale Order, JDS will file a motion to assume and assign the Desired Contracts to the Successful Bidder. The entities holding liens in the Assets could be compelled to accept money in satisfaction of their interests. Accordingly, JDS aks that the Court authorizes the sale of the Property free and clear of all liens, claims, encumbrances, and other interests, including possessory leasehold interests. A copy of the APA and the Exhibits is available at https://tinyurl.com/yxkmxa3h from PacerMonitor.com free of charge. About Jim's Disposal Service Jim's Disposal Service, LLC, a company that specializes in residential waste solutions, filed a Chapter 11 petition (Bankr. W.D. Mo. Case No. 20-40050) on Jan. 6, 2020. At the time of the filing, the Debtor estimated $50,000 in assets and $1 million to $10 million in liabilities. Judge Brian T. Fenimore oversees the case. Larry A. Pittman, II, Esq., and Robert Baran, Esq., at Mann Conroy, LLC, are the Debtors' bankruptcy attorneys. JRNA INC: Seeks Court Approval to Hire Accountant ------------------------------------------------- JRNA, Inc. seeks authority from the U.S. Bankruptcy Court for the Eastern District of Pennsylvania to hire Jon Levin of Levin & Company as its accountant. Mr. Levin will provide accounting services with respect to the day-to-day conduct of Debtor's reorganization proceedings, including the formulation and preparation of a Chapter 11 plan of reorganization. The accountant will be paid at the rate of $210 per hour. Mr. Levin disclosed in court filings that he is a "disinterested person" as defined under Section 101(14) of the Bankruptcy Code. Mr. Levin can be reached at: Jon Levin, CPA Levin & Company 6614 Ruppsville Road Allentown, PA 18106 Tel 610-841-0300 Fax 610-841-0301 Email: Jon@levincpa.com info@levincpa.com About JRNA Inc. JRNA, Inc., which conducts under the business Unclaimed Freight, operates as a furniture store. Visit https://www.saveatthefreight.com for more information. JRNA filed its voluntary Chapter 11 petition (Bankr. E.D. Penn. Case No. 20-13645) on Sept. 10, 2020. At the time of filing, Debtor estimated $500,000 to $1 million in assets and $1 million to $10 million in liabilities. Debtor is represented by McLaughlin & Glazer. JW TRUCKING: Seeks to Use Cash Collateral Thru Dec. 31 ------------------------------------------------------ JW Trucking, LLC asks the U.S. Bankruptcy Court for the Western District of Texas, Midland Division, for entry of an order authorizing the use of cash collateral to cover the various expenses that are involved in maintaining its business operations through December 31, 2020. JW Trucking filed for Chapter 11 Bankruptcy as it suffered a tremendous loss of business when the price of oil dropped earlier this year because of the COVID-19 pandemic in the country and because of international trade wars in the oil markets. The Debtor currently has 18 truck tractors and 18 trailers. The Debtor estimates the value of the tractors and trailers to be approximately $1,125,000. Pecos County State Bank asserts a lien on the tractors and trailers. The Debtor also has approximately $52,431.86 in accounts receivable. Advantage Business Capital, Inc. asserts a lien on those accounts receivable. Counsel for Advantage Business Capital has acknowledged the significance of the Debtor's need to continue operating and has agreed to allow the Debtor to use cash collateral only for reasonable and necessary expenses associated with the continued operation of the Debtor's business until a final hearing is conducted. As adequate protection for any diminution in value of each of ABC's interest in the Debtor's collateral, if any, including cash collateral, resulting from the imposition of the automatic stay with respect to the Collateral and/or the Debtor's use, sale or lease of ABC's cash collateral during the pendency of the case, the Debtor proposes to grant ABC valid, binding, enforceable, and automatically perfected liens in its assets and all proceeds and products of the foregoing. A copy of the Debtor's request is available at https://bit.ly/33qjVAf from PacerMonitor.com. About JW Trucking, LLC JW Trucking, LLC is a water hauling company located in Odessa, Texas. It hauls and transports produce water, brine water and fresh water in the oilfield. Jeff Waugh, Jr. started JW Trucking on May 1, 2012. JW Trucking, LLC filed its petition for relief under Chapter 11 of the United States Bankruptcy Code (Bankr. W.D. Tex. Case No. 20-70100) on August 20, 2020. In the petition signed by Jeffrey Waugh, Jr., member, the Debtor estimated $1 million to $10 million in both assets and liabilities. Max R. Tarbox, Esq. at TARBOX LAW, P.C. represents the Debtor as counsel. K & W CAFETERIA: Seeks to Auction Off Restaurants ------------------------------------------------- Richard Craver of Winston-Salem Journal reports that K&W Cafeteria Inc. has committed to selling its assets, including its remaining 18 restaurants, and requested that a bankruptcy judge approve an auction on Dec. 11, 2020, if necessary. The company's motion, filed Oct. 9, 2020, asks the judge to authorize a stalking-horse bidder by Nov. 23, 2020 as well as a Dec. 8, 2020 bid deadline, a Dec. 16 potential sale hearing, and to approve the sale to the highest or best bidder. "Given the economic uncertainty arising from the COVID-19 pandemic and the debtor's current liquidity position, a sale of the business is necessary at this time to preserve the goodwill of the business, its customer relationships and its skilled employees, and to maximize the recovery for creditors of the debtor's estate," according to Friday's filing. The 83-year-old Winston-Salem-based company filed for Chapter 11 bankruptcy protection Sept. 2 as the latest step in a corporate downsizing that began before the COVID-19 pandemic. "The company will continue to serve guests during the restructuring, in accordance with all local coronavirus-related operating restrictions," company president Dax Allred said in a Sept. 14 statement. "This filing follows the recent closure of six unprofitable locations and will allow the company to reduce its debt and improve liquidity." On Oct. 5, 2020, K&W was granted permission to hire SC&H Group Inc., based in Baltimore, "to assist the debtor in connection with a potential transaction or series of transactions ... that may involve a sale or transfer of assets of the debtor to a buyer." According to Friday's filing, SC&H has made outreach calls to 70 potential prospects, but has not identified a stalking-horse bidder. "We have no additional comment around the sale of the business as a going concern beyond our Chapter 11 filing and the motion to employ SC&H to assist with that effort," Allred said Monday. The sale would include real estate owned by Allred Investment Co. and DGV LLC, both listed as affiliates of K&W. DGV and Allred Investment are rental real-estate companies that have Dax Allred listed as president and Donald Allred as managing member, according to the N.C. Secretary of State's website. Allred Investment is the owner of the K&W restaurant at 3300 Healy Drive, the land at 3169 Peters Creek Parkway and the home office at 1391 Plaza West Drive. DGV owns the restaurant at 800 Hanes Mill Road and an annex office at 3250 Healy Drive. The sale would include a 3,621-square-foot lakefront home and a residential lot in the Cornelius section of Lake Norman. The company has the home at 20703 Pointe Regatta Drive listed at $1.4 million, and the lot at 20221 Sloop Court at $175,000. Dax Allred previously said the two properties are listed as "real estate investments." The initial bankruptcy filing listed a loan of $5.88 million made by K&W to DGV, and a $944,111 loan to Allred Investment. Allred said the bankruptcy filing represents "a difficult day in our company's history, but essential for the future of K&W. We look forward to serving future generations as we emerge from this stronger.” The debt owed to Truist includes a $6.73 million Paycheck Protection Plan loan and a $10.95 million lien claim on accounts, inventory, equipment, parts and general intangibles. The PPP loan to K&W was one of the largest granted to a North Carolina business. The U.S. Treasury Department listed the top PPP loan range at between $5 million and $10 million. K&W said in its PPP application that it would attempt to preserve at least 500 jobs with the loan. Allred told The (Raleigh) News & Observer that without the PPP funds, K&W would have closed restaurants during Phase One of the state's restrictions in response to the pandemic. "It absolutely helped," Allred said. "Without the funds, we would not have survived to Phase Two." Before K&W filed for bankruptcy, it closed restaurants in August in Chapel Hill, Goldsboro, Raleigh and Salisbury. It shuttered its experimental K&W Cafe in Clemmons in July 2019 and in High Point in January 2020. About K&W Cafeterias K&W Cafeterias, Inc., is a a company based in Winston Salem, N.C., operator of restaurants. Since celebrating its 75th anniversary in 2012, K&W has shrunk from 35 restaurants to 18. K&W had 323 full-time and 516 part-time employees as of the bankruptcy filing. K&W Cafeterias, Inc., a company based in Winston Salem, N.C., filed a Chapter 11 petition (Bankr. M.D.N.C. Case No. 20-50674) on Sept. 2, 2020. Judge Benjamin A. Kahn presides over the case. In the petition signed by Dax C. Allred, president, the Debtor disclosed $30,085,274 in assets and $22,189,229 in liabilities. The Debtor has tapped Northen Blue, LLP as its bankruptcy counsel, and Bell Davis & Pitt P.A. and Constangy Brooks Smith & Prophete LLP as special counsel. William Miller, U.S. bankruptcy administrator, appointed a committee to represent unsecured creditors in Debtor's Chapter 11 case. The committee is represented by Waldrep Wall Babcock & Bailey PLLC as bankruptcy counsel. K&W CAFETERIAS: Sets Bidding Procedures for Assets -------------------------------------------------- K&W Cafeterias, Inc., asks the U.S. Bankruptcy Court for the Middle District of North Carolina to authorize the bidding procedures in connection with the auction sale of (i) assets used in its restaurant operations, and (ii) real estate owned by its affiliates, Allred Investment Co., LLC ("AIC") and DGV, LLC, that is currently leased to the Debtor for use in its restaurant operations. The Debtor is a North Carolina corporation that presently owns and operates 18 cafeteria style restaurants in locations leased by the Debtor in North Carolina, South Carolina, and Virginia as more specifically set forth on Exhibit A. The Debtor is based in Winston-Salem, North Carolina and has approximately 323 full-time and 516 part-time employees. AIC and DGV are affiliates of the Debtor with common ownership and management. AIC is a North Carolina limited liability company formed on Feb. 20, 1998, which owns the following interests in real property leased to the Debtor for use in its Business: a. Crossroads (Location No. 14): real property located at 1609 Hershberger Road NW, Roanoke, VA 24012; b. Myrtle Beach South (Location No. 15): real property located at 2001 South Kings Highway, Myrtle Beach, SC 29577; c. Healy Drive (Location No. 17): real property located at 3300 Healy Drive, Winston Salem, NC 27103; d. South Park (Location No. 23): real property located at 3169 Peters Creek Parkway, Winston Salem, NC 27127 (land only); e. Cherry Grove (Location No. 42): real property located at 1621 Highway 17, N. Myrtle Beach, SC 29582; and f. Home Office: real property located at 1391 Plaza West Drive, Winston Salem, NC 27103. DGV is a North Carolina limited liability company formed on Feb. 23, 1998, which owns the following interests in real property leased to the Debtor for use in its Business: a. Rocky Mount (Location No. 7): real property located at 1266 North Wesleyan Boulevard, Rocky Mount, NC 27804; b. South Park (Location No. 23): building and improvements on real property located at 3169 Peters Creek Parkway, Winston Salem, NC 27127; c. Hanes Mill Road (Location No. 36): real property located at 800 Hanes Mill Road, Winston Salem, NC 27105; and d. Annex Office: real property located at 3250 Healy Drive, Winston Salem, NC 27103. In connection with its Business, the Debtor obtained a number of loans from Branch Banking & Trust Co., now known as Truist Bank secured by a first priority security interest in the Debtor’s accounts, inventory, equipment, general intangibles and proceeds and products thereof, subordinate only to the properly perfected purchase money security interests of various lenders ("PMSI Lenders") in certain equipment financed by the Debtor as set forth on Exhibit A. The Debtor also obtained two automobile loans secured by liens on two of the Debtor's vehicles in favor of Ally Financial and Honda Financial. Truist also made certain loans to AIC and DGV, in each case evidenced by loan agreements, promissory notes and deeds of trust imposing liens upon certain real property owned by AIC and DGV, including the AIC Real Estate and DGV Real Estate. The Debtor, AIC and DGV have each guaranteed the obligations of one another to Truist. As of the Petition Date, the outstanding balances (including principal and unpaid interest) owed to Truist pursuant to the K&W Loans, AIC Loans and DGV Loans were: (i) K&W Loans - $7,733,251, (ii) AIC Loans - $817,367, and (iii) DGV Loans - $2,518,937. As of the Petition Date, AIC and DGV also owed the following amounts to the Debtor pursuant to its books and records ("Affiliate Loans"): (i) AIC owed the Debtor the sum of $944,111; and (ii) DGV owed the Debtor the sum of $5,878,543. Pursuant to promissory notes executed by AIC and DGV, substantially all of the Affiliate Loans were secured by certain real property owned by AIC or DGV, including without limitation, the AIC Real Estate and DGV Real Estate, with the exception of the Rocky Mount Property. Upon information and belief, no deeds of trust were recorded to evidence the liens on such property. Upon information and belief, Truist and the Debtor are the primary creditors of AIC and DGV as of the Petition Date. Given the economic uncertainty arising from the COVID-19 pandemic and the Debtor's current liquidity position, a sale of the Business is necessary to preserve the good will of the Business, its customer relationships and its skilled employees, and to maximize the recovery for creditors of its estate. In connection with a potential sale of the Business, on Aug. 29, 2020, the Debtor retained SC&H Group, Inc. as its financial advisor to market its Business and begin a sale process. After retaining SC&H, the Debtor engaged in discussions with SC&H, the counsel for the Committee, and the counsel for the Affiliates regarding the sale process and the assets to be included in such process. At the end of these discussions, they determined that including the AIC Real Estate and DGV Real Estate in the sale process would be in the best interests of the creditors of the Affiliates and the Debtor. Subject to the Debtor, the Affiliates, and the Consultation Parties entering into an agreement before the Sale Procedures Hearing regarding the inclusion of the AIC Real Estate and DGV Real Estate in the sale process ("Affiliate Agreement") and such agreement being approved by the Court, the AIC Real Estate and the DGV Real Estate will be included in the Sale Assets and sold along with the Debtor’s Business Assets. The Debtor anticipates that the Affiliate Agreement would provide the Debtor, in consultation with the Consultation Parties, with complete control and decision-making authority over the sale of the AIC Real Estate and DGV Real Estate, subject to a confidential reserve price with respect to the sale of each parcel of real estate. The Affiliate Agreement also would: (a) include the Reserve Price for each parcel of real estate or the method or formula by which such Reserve Price will be determined prior to the Auction; (b) include the method or formula by which the purchase price and Closing Costs will be allocated as between the Business Assets, the AIC Real Estate and the DGV Real Estate at closing; (c) provide that all net proceeds from the sale of the AIC Real Estate and DGV Real Estate would be paid to Truist at closing until the Truist Loans are paid in full; (d) with respect to the balance of any net proceeds allocated to the sale of the AIC Real Estate, provide for the escrow of a portion of such funds up to the outstanding balance of the K&W-AIC Loans pending further order of the Court; and (e) with respect to the balance of any net proceeds allocated to the sale of the DGV Real Estate, provide for the escrow of a portion of such funds up to the outstanding balance of the K&W-DGV Loans pending further order of the Court. The closing costs would include the transaction fee to be paid to SC&H, any break-up fee to be paid to a Stalking Horse Bidder, and any other reasonable and ordinary costs of sale. The terms and provisions of the Affiliate Agreement (with the exception of the confidential Reserve Prices) will be presented to the Court at the Sale Procedures Hearing. The Affiliate Agreement may also include other terms and provisions agreed upon by the Consultation Parties, and any dispute with respect to the Affiliate Agreement would be determined by the Court at the Sale Hearing. The AIC Real Estate and the DGV Real Estate may be included in the sale process over the objection of the Committee and/or Truist if the Debtor and the Affiliates reach an agreement regarding the terms of the inclusion of such real estate in the sale process prior to the Sale Procedures Hearing, and such agreement is approved by the Court. Since its retention, SC&H has engaged in the various activities, all designed to expose the Business to the greatest number of qualified purchasers. To streamline the sale process, the Debtor believes that it is important that any party interested in purchasing the Sale Assets use a common asset purchase agreement template to be prepared by its counsel, in consultation with the Consultation Parties, and provided to potential bidders. As of the date of the Motion, the Debtor and SC&H have not identified a purchaser willing to enter into a binding agreement of sale and serve as the Stalking Horse Bidder. However, the Debtor, subject to the consent of Truist, is asking authority to designate one or more Stalking Horse Bidders and in the Bidding Procedures if it determines that such designation will enhance the sale process. The Debtor asks authority to solicit bids for the Sale Assets utilizing Bidding Procedures. The salient terms of the Bidding Procedures are: a. Bid Deadline: Dec. 8, 2020 at 4:00 p.m. (ET) b. Initial Bid: If a Stalking Horse Bidder has been designated with respect to the assets to be purchased by the Bidder at closing, any Initial Bid must propose a purchase price that has a value to the Seller(s) of at least two times the Break-Up Fee ($150,000 or 2% of the Sale Price) greater than the Initial Bid of the Stalking Horse Bidder as set forth in the Stalking Horse Agreement. c. Deposit: 5% of the fixed purchase price d. Auction: The Auction will be held on Dec. 11, 2020, commencing at 10:00 a.m. (ET), at the office of the Debtor's counsel, Northen Blue, LLP, 1414 Raleigh Road, Suite 435, Chapel Hill, North Carolina 27517 (or such other location as may be determined by the Debtor, in consultation with the Consultation Parties, and communicated to all Qualified Bidders at least two business days before the Auction). e. Bid Increments: To be determined by the Debtor, in consultation with the Consultation Parties, at the Auction f. Sale Hearing: Dec. 16, 2020 at 9:30 a.m. (ET) g. Sale Objection Deadline: Dec. 15, 2020 at 4:00 p.m. (ET) h. Closing: Any closing of the sale of the Sale Assets to a Prevailing Bidder must occur as soon as practicable but in any event by Jan. 15, 2021 (or such later date as the Debtor, in consultation with the Consultation Parties, may agree). Any closing of the sale of the Sale Assets to a Back-up Bidder must occur by Feb. 1, 2021 (or such later date as the Debtor, in consultation with the Consultation Parties, may agree). i. The Sale Assets are being offered "as is, where is," with all faults. Any Stalking Horse Bidder must be designated by the Debtor, in consultation with the Consultation Parties, and the Stalking Horse Agreement filed with the Court on Nov. 23, 2020. The Debtor asks that the sale and transfer of the Business Assets be approved free and clear of all Liens, and that such Liens attach to the proceeds of sale. All liens against the AIC Real Estate and the DGV Real Estate must be paid in full at closing or, with the consent of the lienholder, released at closing. The Debtor believes that Truist, the PMSI Lenders and the Vehicle Lenders are the only parties holding or asserting a lien upon or security interest in the Sale Assets. Truist has a first priority security interest in the Truist Collateral, subordinate only to the properly perfected purchase money security interests in favor of the PMSI Lenders in certain equipment financed by the Debtor. The Debtor anticipates that all the Lenders will consent to the transaction presented for approval at the Sale Hearing, so long as upon the consummation of the sale and payment in full of all consideration under the applicable asset purchase agreement, the liens and security interests of the Lenders will attach to the proceeds of the sale. The Bidding Procedures contemplate the possible assumption of certain executory contracts and unexpired leases and the assignment of these contracts and leases to the Prevailing Bidder or Back-up Bidder at closing. The Debtor proposes the Assignment Procedures for assumption and assignment of executory contracts and unexpired leases and for fixing of amounts to be paid to satisfy obligations to cure defaults. Within three business days after entry of the Sale Procedures Order, the Debtor will serve on all non-debtor counterparties to executory contracts and unexpired leases the Assignment Notice. It will attach to the Assignment Notice its calculation of the cure amounts that it believes must be paid to each non-debtor counterparty to satisfy all Cure Obligations. Any delay in the Debtor's ability to consummate the sale would be detrimental to it, its creditors and estate, and would impair its ability to take advantage of the substantial cost-savings that can be achieved by an expeditious closing of the sale. Accordingly, it submits that ample cause exists to justify a waiver of the 14-day stay imposed by Bankruptcy Rule 6004(h) and 6006(d), to the extent applicable. A copy of the Bidding Procedures is available at https://tinyurl.com/y2t9x4n5 from PacerMonitor.com free of charge. About K&W Cafeterias K&W Cafeterias, Inc., a company based in Winston Salem, N.C., filed a Chapter 11 petition (Bankr. M.D.N.C. Case No. 20-50674) on Sept. 2, 2020. Judge Benjamin A. Kahn presides over the case. In the petition signed by Dax C. Allred, president, the Debtor disclosed $30,085,274 in assets and $22,189,229 in liabilities. The Debtor has tapped Northen Blue, LLP as its bankruptcy counsel, and Bell Davis & Pitt P.A. and Constangy Brooks Smith & Prophete LLP as special counsel. William Miller, U.S. bankruptcy administrator, appointed a committee to represent unsecured creditors in Debtor's Chapter 11 case. The committee is represented by Waldrep Wall Babcock & Bailey PLLC as bankruptcy counsel. KEYSTONE FILLER: Taps Matteis & Company as Accountant ----------------------------------------------------- Keystone Filler and Mfg. Co. received approval from the U.S. Bankruptcy Court for the Middle District of Pennsylvania to hire Matteis & Company, LLC as its accountant. Matteis will assist Debtor in the preparation of its tax returns and will provide other accounting services. John Matteis, a certified public accountant at Matties & Company, disclosed in court filings that his firm does not represent interests adverse to the Debtor and its bankruptcy estate. The firm can be reached through: John J. Matties, CPA Matties & Company, LLC 2424 North Federal Highway, Suite 203 Boca Raton, FL 33431 Phone: 561 405 9440 Fax: 561 314 6150 Email: mtteiscpa@jmcpallc.com About Keystone Filler & Mfg. Co. Keystone Filler and Mfg. Co., a manufacturer of carbon-based products, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Pa. Case No. 19-02014) on May 9, 2019. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge Robert N. Opel II oversees the case. Cunningham, Chernicoff & Warshawsky, P.C. is Debtor's legal counsel. KLAUSNER LUMBER: Hires Donlin Recano as Administrative Advisor -------------------------------------------------------------- Klausner Lumber Two, LLC received approval from the U.S. Bankruptcy Court for the District of Delaware to employ Donlin, Recano & Company, Inc. as its administrative advisor. The firm's services are as follows: a. assist in the solicitation, balloting, tabulation and calculation of votes for purposes of plan voting; b. prepare reports, exhibits and schedules of information; c. prepare an official ballot certification and, if necessary, testify in support of the ballot tabulation results; d. assist in the preparation of the Debtor's schedules of assets and liabilities and statements of financial affairs and gather data in conjunction therewith; e. assist with the filing of claims objections and exhibits, claims reconciliation and related matters; f. facilitate any distributions pursuant to a confirmed plan of reorganization; and g. provide confidential on-line work spaces or virtual data rooms and publish documents to such workspaces or data rooms. Donlin Recano will be paid at hourly rates as follows: Executive Management No charge Senior Bankruptcy Consultant $140 - $170 Case Manager $70 - $150 Technology/Programming Consultant $80 - $140 Consultant/Analyst $70 - $90 Clerical $25 - $40 Donlin Recano will also be reimbursed for out-of-pocket expenses incurred. Nellwyn Voorhies, executive director at Donlin Recano, disclosed in court filings that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Donlin Recano can be reached at: Nellwyn Voorhies Donlin, Recano & Company, Inc. 6201 15th Avenue Brooklyn, NY 11219 Toll Free Tel: (800) 591-8236 About Klausner Lumber Two Klausner Lumber Two, LLC, a sawmill company in Enfield, N.C., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 20-11518) on June 10, 2020. Robert Prusak, chief restructuring officer, signed the petition. At the time of the filing, Debtor had estimated assets of between $10 million and $50 million and liabilities of between $100 million and $500 million. Judge Karen B. Owens oversees the case. Debtor has tapped Westerman Ball Ederer Miller Zucker & Sharfstein, LLP and Morris, Nichols, Arsht & Tunnell, LLP as its bankruptcy counsel, Asgaard Capital LLC as restructuring advisor, and Cypress Holdings LLC as investment banker. The U.S. Trustee for the District of Delaware appointed a committee of unsecured creditors in Debtor's Chapter 11 case on June 25, 2020. The committee has tapped Elliott Greenleaf, P.C. as its legal counsel and EisnerAmper LLP as its financial advisor. KORN FERRY: Moody's Affirms Ba2 CFR, Outlook Remains Stable ----------------------------------------------------------- Moody's Investors Service affirmed Korn Ferry's Ba2 corporate family rating and Ba2-PD Probability of Default Rating. Moody's also affirmed Korn Ferry's Ba3 senior unsecured rating and maintained the SGL-1 speculative grade liquidity rating. The outlook remains stable. Affirmations: Issuer: Korn Ferry Corporate Family Rating, Affirmed Ba2 Probability of Default Rating, Affirmed Ba2-PD Senior Unsecured Regular Bond/Debenture, Affirmed Ba3 (LGD4) from (LGD5) Outlook Actions: Issuer: Korn Ferry Outlook, Remains Stable RATINGS RATIONALE The recession caused by COVID-19 has led to a steep decline in revenue and margins, which will result in very high debt/EBITDA gross leverage in fiscal 2021, around 4.5x (Moody's adjusted), until Korn Ferry returns to more normalized levels towards 3x in fiscal 2022. The company's strong liquidity position is a key mitigant to the anticipated deterioration in credit metrics over the next 12 months. However, the duration and impact of the coronavirus recession remains uncertain and elevates risks. The global recovery will be tied to the containment of the virus. A prolonged strain on revenue and margins would pressure the rating, which incorporates the expectation that long-term debt/EBITDA will remain under 3x. The rating reflects Korn Ferry's leadership position in the human resources (HR) services business and its large scale, with roughly $1.8 billion in revenue as of the twelve-month period ending July 2020. Korn Ferry's established brand, diversifying offerings, global client network and track record provide competitive advantages. However, the company faces strong competition, which limits profitability and organic growth. The talent acquisition segments have low barriers to entry and easily available online tools, such as LinkedIn, enable competition and insourcing by corporates. The need to retain and compete for key employees' pressures margins. In the advisory segment, the company competes against very large global firms with deep pockets. Over the last 10 years, the company has increased revenue and diversified its offerings beyond talent acquisition services through strategic M&A. Several acquisitions have added organizational consulting capabilities and contributed to a growing proprietary database of benchmarking and talent development tools. However, more than half of Korn Ferry's revenue is still generated by talent acquisition services, which are very cyclical and experience sudden drops in demand during economic downturns. Moody's expects management will continue to pursue adjacent HR capabilities through M&A. The high cyclicality of Korn Ferry's core business makes liquidity a key consideration for the rating. Korn Ferry's speculative grade liquidity rating of SGL-1 reflects a very good liquidity profile based on a cash and equivalents balance of $543 million and $38 million of available marketable securities, as of July 2020. The company also has an additional $152 million marketable securities balance but this is not considered available liquidity given it is held in a trust to satisfy obligations under Korn Ferry's deferred compensation plans. In addition, Korn Ferry's company owned life insurance plans reflect a net cash surrender value of $148 million as of July 2020. Moody's expects cash from operations in fiscal 2021 will be more than sufficient to cover capital expenditures and dividends, resulting in over $125 million of free cash flow (Moody's adjusted net of dividends). Korn Ferry also has an undrawn $650 million senior secured revolving credit facility maturing in 2024, which provides ample liquidity to address seasonal and cyclical swings. The senior secured revolving credit facility incorporates three financial covenants: a 3.0x interest coverage ratio, a 4.0x consolidated net leverage ratio (currently 4.25x until January 2021), and a 3.25x consolidated senior secured net leverage (3.5x until January 2021). The net leverage covenants include a $100 million cap on cash netting (all covenant metrics per the Credit Agreement definition). Moody's expects Korn Ferry will be in compliance with its covenants for the next 12 months. Instrument ratings for the senior unsecured notes (Ba3, LGD4) due 2027 are one notch below the Ba2 corporate family rating, reflecting their junior position in the capital structure below the $650 million senior secured facility (unrated). The instrument ratings also reflect the overall Ba2-PD probability of default and the expectation for an average family recovery in a default scenario. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects the expectation for material revenue and profitability pressure over the next 6 - 12 months, offset by a strong liquidity position. Moody's expects revenue will experience sizeable declines in fiscal 2021 (ending April 2021), in the 20% - 25% range compared to fiscal 2020, driven by pressure from the COVID-19 downturn. The executive and professional search segments will experience the highest declines given their highly cyclical demand characteristics, while digital and consulting will be more resilient. Margins are expected to decline materially in fiscal 2021, with Moody's adjusted EBITDA margin in the 10% - 12% range (down from 18.5% in fiscal 2020), as declining revenue reduces scale benefits and Korn Ferry reverses cost reduction actions in preparation for economic recovery. Despite declining revenue and profitability, liquidity is expected to remain strong as a result of a strong position going into the COVID-19 recession and the cost cutting plan implemented by management at the onset of the pandemic. Moody's expects Korn Ferry will have liquidity in excess of $575 million (net of bonus and deferred compensation accruals) by the end of fiscal 2021, up from $532 million in fiscal 2020. Weaker than anticipated liquidity would pressure the rating. Leverage will see a spike in fiscal 2021, with debt/EBITDA (Moody's adjusted) around 4.5x, declining to more normalized levels towards 3x in fiscal 2022 as the anticipated economic recovery unfolds. However, the duration and impact of the coronavirus recession remains uncertain and elevates risks. The ratings could be upgraded if Moody's expects 1) increased scale and organic revenue growth, evidencing an improved competitive position; 2) reduced exposure to cyclical economic swings; 3) conservative financial policies with debt/EBITDA sustained below 2.5x (Moody's adjusted) throughout an economic cycle; and 4) strong liquidity and additional financing flexibility from a substantially unsecured capital structure. The ratings could be downgraded if Moody's expects 1) increased competition or sustained cyclical pressure will result in a prolonged period of lower than expected revenue or profitability; 2) debt/EBITDA (Moody's adjusted) to be sustained above 3x; 3) liquidity deterioration, as evidenced by diminished balance sheet cash compared to historical levels or the need to draw on the revolver to support operating gaps; or 4) aggressive financial policies. Korn Ferry is a global human resources and organizational consulting firm. The company operates through 4 segments: executive search (38% of fee revenue as of fiscal year 2020), professional search and recruitment process outsourcing (RPO, 19% of fee revenue), consulting services (28% of fee revenue) and digital (15% of fee revenue). Korn Ferry is headquartered in Los Angeles, CA and operates in 111 offices across 53 countries, with over 8,198 full-time employees (as of fiscal year 2020). For the 12-month period ending July 2020, Korn Ferry generated roughly $1.8 billion in revenue. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. KRIEGER CRAFTSMEN: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Krieger Craftsmen, Inc. 2758 - 3 Mile Road NW Grand Rapids, MI 49534 Business Description: Located in Grand Rapid, MI, Krieger Craftsmen, Inc. -- https://www.kriegercraftsmen.com/ -- is a manufacturer of plastic injection molds for the automotive, medical, appliance, and consumer products industries. Chapter 11 Petition Date: October 11, 2020 Court: United States Bankruptcy Court Western District of Michigan Case No.: 20-03157 Judge: Hon. John T. Gregg Debtor's Counsel: A. Todd Almassian, Esq. KELLER & ALMASSIAN, PLC 230 East Fulton Grand Rapids, MI 49503 Tel: 616-364-2100 Email: ecf@kalawgr.com Debtor's Financial Advisors: GANTRY BUSINESS SOLUTIONS, LLC Debtor's Accountants: NIENHUIS FINANCIAL GROUP, LLC Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Timothy J. Krieger, president. A copy of the Debtor's list of 20 largest unsecured creditors is available for free at: https://www.pacermonitor.com/view/X74DTUI/Krieger_Craftsmen_Inc__miwbke-20-03157__0002.0.pdf?mcid=tGE4TAMA A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/XRVNZHY/Krieger_Craftsmen_Inc__miwbke-20-03157__0001.0.pdf?mcid=tGE4TAMA L.S.R. INC: Unsecureds to Get Paid from Property Sale Proceeds -------------------------------------------------------------- L.S.R., Inc., filed a First Amended Disclosure Statement describing its Plan of Liquidation on August 21, 2020. Each unsecured creditor will receive their pro rata share of the sale proceeds from the Brickstreet sale after payment of all Administrative Expenses and creditors and interest holders. The Debtor's officers in their sole discretion will then determine if legal action is merited against Housing Authority of Mingo County (HAMC) which funds if any would then be likewise distributed. Equity security holders will receive no payment for their interest. Payments and distributions under the Plan will be funded by the sale of the Brickstreet Property and litigation against HAMC if deem appropriate by the officers of the Debtor after sale of the Brickstreet Property. A full-text copy of the Amended Disclosure Statement dated August 21, 2020, is available at https://tinyurl.com/y4sdbbqj from PacerMonitor.com at no charge. About L.S.R. Inc. L.S.R., Inc. owns a motel building with improvements located at 201 West 2nd Avenue Williamson, West Virginia. L.S.R. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W.Va. Case No. 18-20221) on May 2, 2018. In the petition signed by Doyle R. VanMeter II, president, the Debtor disclosed $1.02 million in assets and $1.55 million in liabilities. Judge Frank W. Volk presides over the case. The Debtor is represented by: James M. Pierson, Esq. Pierson Legal Services P.O. Box 2291 Charleston, WV 25328 Tel: (304) 925-2400 E-mail: jpierson@piersonlegal.com LAKES EDGE: 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 The Lakes Edge Group, LLC. About The Lakes Edge Group The Lakes Edge Group, LLC classifies its business as single asset real estate (as defined in 11 U.S.C. Section 101(51B)). The Lakes Edge Group filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. M.D.N.C. Case No. 20-50715) on Sept. 24, 2020. Mark Fletcher, authorized representative, signed the petition. At the time of the filing, the Debtor had estimated assets of less than $50,000 and estimated liabilities of $1 million to $10 million. Judge Lena M. James oversees the case. Bennett-Guthrie PLLC is the Debtor's legal counsel. LAKEWAY PUBLISHERS: Taps RE/MAX as Real Estate Agent ---------------------------------------------------- Lakeway Publishers, Inc. received approval from the U.S. Bankruptcy Court for the Eastern District of Tennessee to employ RE/MAX Real Estate Ten, Inc. as its real estate agent. RE/MAX will assist in the sale of Debtor's real property located at 500 Noes Chapel Road, Morristown, Tenn. The firm will get a 10 percent commission on the gross sales price. Terry Ball, a member of RE/MAX, disclosed in court filings that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. RE/MAX Real Estate can be reached at: Terry Ball RE/MAX Real Estate Ten, Inc. 2320 E Morris Blvd Morristown, TN 37813 Tel: (423) 839-2251 About Lakeway Publishers Lakeway Publishers, Inc. is a multi-state publisher of newspapers, magazines and special publications. It 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 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 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 have tapped Quist, Fitzpatrick & Jarrard, PLLC as their bankruptcy counsel, and Burnette Dobson & Pinchak and Maneke Law Group as special counsel. LSC COMMUNICATIONS: Seeks Court Approval to Hire Appraisers ----------------------------------------------------------- LSC Communications, Inc. and its affiliates seek authority from the U.S. Bankruptcy Court for the Southern District of New York to employ Hilco Valuation Services, LLC and Hilco Real Estate Appraisal, LLC as their appraisers. The Debtors selected Hilco Valuation to conduct an appraisal of machinery and equipment that were used to operate their businesses. The firm will charge $299,500 for its services and will receive a retainer in the amount of $149,750. Meanwhile, Hilco Real Estate will conduct an appraisal of 17 real properties owned by Debtors located in Illinois, Indiana, Kentucky, Minnesota, Nevada, Ohio, Pennsylvania and Virginia. The firm will be paid the sum of $115,000. Hilco Valuation and Hilco Real Estate are "disinterested" under Section 101(14) of the Bankruptcy Code, according to a declaration filed by Sarah Baker, vice president and assistant general counsel of Hilco Trading, LLC, the firms' managing member. The firms can be reached through: Sarah K. Baker Hilco Trading, LLC 5 Revere Dr Suite 206 Northbrook, IL 60062 Phone: 847-509-1100 About LSC Communications Inc. LSC Communications, Inc. is a Delaware corporation established in 2016 with its headquarters located in Chicago. It offers a broad range of traditional and digital print products, print-related services, and office products. LSC Communications has offices, plants and other facilities in 28 states, as well as operations in Mexico, Canada and the United Kingdom. Visit http://www.lsccom.com for more information. LSC Communications and its affiliates filed a Chapter 11 petition (Bankr. S.D.N.Y. Lead Case No. 20-10950) on April 13, 2020. In its petition, LSC Communications estimated $1.649 billion in assets and $1.721 billion in liabilities. Andrew B. Coxhead, chief financial officer, signed the petition. The Debtors have tapped Sullivan & Cromwell LLP and Young Conaway Stargatt & Taylor LLP as their bankruptcy counsel, Evercore Group LLC as investment banker, AlixPartners LLP as restructuring advisor, and Prime Clerk as notice, claims and balloting agent. MALLINCKRODT PLC: In Chapter 11 Bankruptcy Amid Opioid Suits ------------------------------------------------------------ Reuters reports that Mallinckrodt filed for Chapter 11 bankruptcy protection on Monday, October 12, 2020, in the face of lawsuits alleging it fueled the U.S. opioid epidemic and after it lost a court battle to avoid paying higher rebates to state Medicaid programs for its top-selling drug. Mallinckrodt said in February 2020 it planned to have its generic drug business file for bankruptcy as part of a tentative $1.6 billion opioid settlement resolving claims by state attorneys general and U.S. cities and counties. Mallinckrodt filed for Chapter 11 bankruptcy protection on Monday in the face of lawsuits alleging it fueled the U.S. opioid epidemic and after it lost a court battle to avoid paying higher rebates to state Medicaid programs for its top-selling drug. Mallinckrodt said in February 2020 it planned to have its generic drug business file for bankruptcy as part of a tentative $1.6 billion opioid settlement resolving claims by state attorneys general and U.S. cities and counties. It further warned on Aug. 4, 2020 that the parent company and other units may also file for Chapter 11 protection after a judge allowed the federal government to force it to pay higher rebates to state Medicaid programs for its multiple-sclerosis drug H.P. Acthar Gel. More than 3,000 lawsuits have been filed accusing drug manufacturers of engaging in deceptive marketing that promoted the use of addictive painkillers, fueling an epidemic that since 1999 has resulted in more than 450,000 overdose deaths. Federal prosecutors open criminal probe of opioid manufacturers: Reports Mallinckrodt said on Monday, October 12, 2020, it intends to use the Chapter 11 process to implement a restructuring support agreement that would provide for an amended proposed opioid claims settlement and a financial restructuring. The drugmaker said the company and all of its subsidiaries would continue to operate as normal. About Mallinckdrodt Mallinckrodt -- http://www.mallinckrodt.com/-- is a global business consisting of multiple wholly owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; analgesics and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. As of March 27, 2020, the Company had $10.17 billion in total assets, $8.27 billion in total liabilities, and $1.89 billion in total shareholders' equity. On Oct. 12, 2020, Mallinckrodt plc and certain of its affiliates sought Chapter 11 protection in Delaware in the U.S. (Bankr. D. Del. Lead Case No. 20-12522) to seek approval of a restructuring that would reduce total debt by $1.3 billion and resolve opioid-related claims against the Company. Mallinckrodt plc disclosed $9,584,626,122 in assets and $8,647,811,427 in liabilities as of Sept. 25, 2020. Latham & Watkins LLP, Ropes & Gray LLP and Wachtell, Lipton, Rosen & Katz are serving as counsel to the Company, Guggenheim Securities, LLC is serving as investment banker and AlixPartners LLP is serving as restructuring advisor to Mallinckrodt. Hogan Lovells is serving as counsel with respect to the Acthar Gel matter. Prime Clerk LLC is the claims agent. MARINER SEAFOOD: U.S. Trustee Appoints Creditors' Committee ----------------------------------------------------------- The U.S. Trustee for Region 1 appointed a committee to represent unsecured creditors in the Chapter 11 case of Mariner Seafood, LLC. The committee members are: 1. Glenn Goodwin RGK Goodwin Partnership LLC 100 Davisville Pier North Kingston, RI 02852 Phone: (401) 640-2166 Email: glenng3@verizon.net 2. Peter Avila Empire Staffing, Inc. 802B Belleville Avenue New Bedford, MA 02109 Phone: (774) 305-4500 Fax: (774) 328-9234 Email: pete@empirestaffing.net 3. Kira Laurila Titania Seafood LTD Easey Commercial Building 253-261 Hennessy Road Wanchai, Hong Kong Phone: +358-45-306-5526 Email: kira.laurila@titaniaseagroup.com Official creditors' committees serve as fiduciaries to the general population of creditors they represent. They may investigate the debtor's business and financial affairs. Committees have the right to employ legal counsel, accountants and financial advisors at a debtor's expense. About Mariner Seafood Mariner Seafood, LLC is a New Bedford, Mass.-based company that is engaged in the business of buying and selling seafood inventory from third party importers to domestic and Canadian seafood processors and food service distributors. Mariner Seafood sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 20-11870) on Sept. 14, 2020. The petition was signed by John P. Flynn, president and manager. At the time of the filing, the Debtor was estimated to have $10 million to $50 million in both assets and liabilities. The Debtor has tapped Murphy & King, Professional Corporation as its bankruptcy counsel, Salter McGowan Sylvia and Leonard, Inc. as special counsel, and Tully & Holland, Inc. as investment banker. MD AMERICA ENERGY: Files for Chapter 11 With Prepackaged Plan ------------------------------------------------------------- MD America Energy, LLC, a Texas-based oil and gas operating company, on Oct. 12, 2020, announced that it has entered into a fully-backed restructuring support agreement. To facilitate the Agreement and implement a comprehensive balance sheet restructuring and pre-packaged Plan of Reorganization, the Company also filed a proceeding under Chapter 11 of the United States Bankruptcy Code in the Southern District of Texas Houston Division and has proposed a confirmation schedule that would result in emerging from bankruptcy in 45 to 60 days. The Company has ample liquidity to support operations during this time and business operations will continue in the ordinary course uninterrupted. "The actions we are taking today will allow us to reduce our debt and strengthen our balance sheet, enabling us to continue to succeed in the extremely competitive oil and gas market in which we do business," said Scott Avila, Chief Restructuring Officer of MD America. "We are thankful to have the unanimous support of our lenders, and we expect to move quickly through this financial restructuring process." Subject to Court approval, the Company intends to pay vendors, suppliers, and other third-party contractors for goods and services provided prior to the filing date in the ordinary course of business. Robert Warshauer, Chairman, MD America Board of Directors, commented, "I want to thank MD America's team members, royalty holders, suppliers and strategic business partners who remain supportive as we focus on positioning the Company for long-term success. We recognize this has been a challenging time on numerous fronts, and we look forward to MD America emerging from this process a financially stronger and more competitive business." Court filings as well as other information related to the restructuring are available at https://cases.primeclerk.com/MDAmerica or by calling Toll Free: (877) 464-6899 / International: (347) 817-4095 or via email MDAmericaInfo@primeclerk.com. The Company is being advised by the law firm of Porter Hedges LLP, and Paladin, as Chief Restructuring Officer and financial advisor. About MD America MD America is a Texas based oil and gas operating company engaged in the acquisition, development, exploitation and production of crude oil and natural gas properties in East Texas. Assets currently consist of approximately 71,000 net acres with over 300 drilled and operated wells. MD AMERICA: Case Summary & 30 Largest Unsecured Creditors --------------------------------------------------------- Lead Debtor: MD America Energy, LLC FDBA Woodbine Acquisition LLC FDBA Woodbine Texas Acquisition LLC 301 Commerce Street, Ste. 2500 Fort Worth, TX 76102 Business Description: The Debtors are a Texas based, privately owned oil and gas operating company engaged in the acquisition, development, exploitation and production of crude oil and natural gas properties in East Texas. MD America Energy, LLC, which is the Debtors' principal operating entity, currently owns approximately 64,683 net acres with 256 operated wells, focused in the Brazos Valley in East Texas and over 100 miles of low-pressure natural gas gathering lines owned and operated by MD America's subsidiary, MD America Pipeline LLC. For more information, visit https://www.mdae.com. Chapter 11 Petition Date: October 12, 2020 Court: United States Bankruptcy Court Southern District of Texas Six affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- MD America Energy, LLC (Lead Debtor) 20-34966 MD America Energy Holdings, Inc. 20-34967 MD America Intermediate Holdings, LLC 20-34968 MD America Holdings, LLC 20-34969 MD America Pipeline, LLC 20-34970 MD America Finance Corporation 20-34971 Judge: Hon. David R. Jones Debtors' Bankruptcy Counsel: John F. Higgins, Esq. M. Shane Johnson, Esq. Megan Young-John, Esq. Mark D. Jones, Esq. PORTER HEDGES LLP 1000 Main Street, 36th Floor Houston, Texas 77002 Tel: (713) 226-6000 Fax: (713) 226-6248 Email: jhiggins@porterhedges.com sjohnson@porterhedges.com myoungjohn@porterhedges.com mjones@porterhedges.com Debtors' Financial Advisor: FTI CONSULTING, INC. Debtors' Claims, Noticing, & Solicitation Agent: PRIME CLERK, LLC https://cases.primeclerk.com/MDAmerica/Home-DocketInfo Debtors' Provider of Restructuring Officer Services: PALADIN MANAGEMENT GROUP, LLC MD America Energy, LLC's Estimated Assets: $50 million to $100 million MD America Energy, LLC's Estimated Liabilities: $100 million to $500 million The petitions were signed by Scott Avila, chief restructuring officer. A copy of MD America Energy's petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/CAVYB3Q/MD_America_Energy_LLC__txsbke-20-34966__0001.0.pdf?mcid=tGE4TAMA List of Debtors' 30 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Donna V. Grimmer Working Interest/ $408,399 Address on File Royalty 2. Family Energy Services, Inc. Working Interest/ $357,938 Attn: Bruce Daniel Agent Royalty 9450 Grogan's Mill Rd. The Woodlnds, TX 77380 3. Margaret Ann Adams Working Interest/ $272,128 Melvin Family Royalty Address on File 4. Union Pacific Working Interest/ $260,945 Railroad Company Royalty Attn: President or General Counsel 1400 Douglas Street, Stop 1690 Omaha, NE 68179 Fax: 402-544-5000 Email: mgkozise@up.com 5. Centerpoint Energy Working Interest/ $180,266 Houston Elec LLC Royalty Attn: President or General Counsel P.O. Box 1475 Houston, TX 77251 Fax: 713-207-6803 6. Stephens Production Company Working Interest/ $179,440 Attn: Douglas E. Wein, Royalty Land Manager 623 Garrison Ave Fort Smith, AR 72901 Fax: 303-296-2012 Email: jpetrey@stephenspro.com; mmeador@stephenspro.com 7. Thelma Akers Indv. and as Working Interest/ $171,236 Trustee, Address on File Royalty 8. America Keefer Successors Working Interest/ $98,750 Address Unknown Royalty 9. Lincoln National Life Working Interest/ $89,192 Insurance Company Royalty Attn: President or General Counsel 1300 S. Clinton St. Fort Wayne, IN 46802 Fax: 800-487-1485 10. Michael K. King & Working Interest/ $67,160 Ferol E. Griffin King Royalty Address Unknown 11. Sara Adams Jennings Working Interest/ $70,195 Address on File Royalty 12. Ellwood T Barrett Working Interest/ $56,105 Address on File Royalty 13. Westco Family Working Interest/ $54,141 Limited Partnership Royalty Attn: Stephen R. Henson (President) P.O. Box 1888 Gilmer, TX 76544 Fax: 903-725-7528 Email: srhenson1@aol.com 14. Windy Hill Ranch Ltd Working Interest/ $49,658 Attn: President or Royalty General Counsel P.O. Box 129 Madisonville Madisonville, TX 77864 15. John M. Andrews Family Trust Working Interest/ $49,560 Address on File Royalty 16. Nelda Dunman Life Estate Working Interest/ $45,852 Address on File Royalty 17. E.M. Bealle, III Working Interest/ $37,360 Address on File Royalty 18. Geosouthern Energy Corp Working Interest/ $34,356 Attn: President or Royalty General Counsel 1425 Lake Front CR Ste 200 The Woodlands, TX 77380 Fax: 281-363-9161 Email: jibaccounting@geosouthernenergy.com 19. Shirley Swilley Working Interest/ $33,078 Harkins Estate Royalty Address on File 20. David H. Murdock Working Interest/ $33,065 Address on File Royalty 21. Janie Eliza McGee Heirs Working Interest/ $31,326 Address on File Royalty 22. James D. Wilson Working Interest/ $30,518 Attn: James D. Wilson, Jr. Royalty Address on File 23. E Minerals, L Working Interest/ $30,518 Attn: President or Royalty General Counsel 16952 East State Highway 21 Bryan, TX 77808 Fax: 979-229-1970 Email: jbnewcom@wildblue.net 24. CML Exploration LLC Working Interest/ $31,025 Attn: Shirley Smith Royalty P.O. Box 841738 Dallas, TX 75284 Tel: 325-573-0749 Fax: 325-573-0750 Email: rogersl@cmlexp.com; owensk@cmlexp.com 25. Horace P Dansby III Working Interest/ $28,406 Address on File Royalty 26. Dalton S Whitmire and Working Interest/ $28,568 Ella L. Whitmire Royalty Address on File 27. David Grimmer and Working Interest/ $30,163 Donna Venable Royalty Address on File 28. Oak Tree Minerals, LLC Working Interest/ $27,030 Attn: President or Royalty General Counsel 2601 Network Blvd. Suite 404 Frisco, TX 75034 Tel: 214-975-2526 Fax: 214-987-6000 Email: operations@oaktreemineralsem.com 29. Mediapark Limited Working Interest/ $26,557 Attn: Emily Davis Royalty 1030 West Georgia St. Suite 918 Wanvouver, BC V6E 2Y3 Canada Fax: 604-628-5616 Email: edavis@v1.ca; emily@tyandsons.com 30. Woodroe McMahon & Mercedes Working Interest/ $24,190 Attn: Kenneth McMahon Royalty P.O. Box 534 North Zulch, TX 77872 Fax: 936-399-6233 MICHAEL'S GOURMET: Unsecured Creditors to Recover 2% Over 5 Years ----------------------------------------------------------------- Michael's Gourmet Coffee's, Inc., filed with the U.S. Bankruptcy Court for the Southern District of Florida, Fort Lauderdale Division, a Disclosure Statement in support of Chapter 11 Plan of Reorganization. The Debtor filed this case to continue operations and preserve the going concern value of its operations for the benefit of its creditors and the estate. The Debtor will restructure its existing debts with various creditors to allow it to function without the constant threat of collection activity. The Debtor will be adding several new accounts in Europe and as a result expects an increase in revenues to an average of about $28,000 per month. Debtor forecasts an average of $2,050 per month for the next five years in net profit. A profit of $2,000 per month will adequately fund the Debtor's Plan of Reorganization. Class 5 constitutes the general unsecured claims. The total amount of allowed general unsecured claims is $294,440. General unsecured creditors will be paid 2% of their claim ($5,889) over 60 months in 20 quarterly installments of $294.44. The bar date for filing a Proof of Claim was March 16, 2020. The two insiders of the Debtor are John Hodgson, CEO and Joseph Mistretta, President. Each own fifty percent (50%) of the Debtor. Upon the effective date of the Debtor's Plan of Reorganization, John Hodgson and Joseph Mistretta shall each remain a 50% equity shareholder in the newly reorganized Debtor. The funds to make the initial payments will come from Debtor in Possession’s Bank account. Funds to be used to make cash payments pursuant to the Plan shall derive from Debtor's net profits. Debtor asserts that it is able to perform all of Debtor's obligations under the Plan, and as such, the Debtor's Plan satisfies Sec. 1129(a)(11) of the Code. A full-text copy of the Disclosure Statement dated August 25, 2020, is available at https://tinyurl.com/y4jf7gpq from PacerMonitor at no charge. The Debtor is represented by: Chad Van Horn, Esq. Van Horn Law Group, P.A. 330 N. Andrews Ave., Suite 450 Fort Lauderdale, Florida 33301 Telephone: (954) 765-3166 Facsimile: (954) 756-7103 E-mail: Chad@cvhlawgroup.com About Michael's Gourmet Coffee's Based in Pompano Beach, Florida, Michael's Gourmet Coffee's, Inc., sought Chapter 11 protection (Bankr. S.D. Fla. Case No. 19-25705) on Nov 21, 2019. In the petition signed by Joseph Mistretta, president, the Debtor was estimated to have under $1 million in both assets and liabilities. Chad T. Van Horn, Esq., represents the Debtor. NAJEEB A. KHAN: Trustee Selling Deer Lodge Property for $212.5K --------------------------------------------------------------- Mark T. Iammartino, as the Chapter 11 Trustee for the estate of Najeeb Ahmed Khan, asks the U.S. Bankruptcy Court for the Western District of Michigan, to authorize the sale of the real property commonly known as 66 Skaggs Hollow Road, Deer Lodge, Montana to Dan Hollingsworth, solely in his capacity as the Trustee of the Hollingsworth Family Trust, for $212,500, subject to higher and better offers. As of the Petition Date, the Debtor owned the Property. The Debtor's wife, Nancy Khan, previously asserted a marital interest in the Property before entering into a settlement agreement with the Chapter 11 Trustee and various other parties ("Global Settlement Agreement"), which agreement the Court approved in an order entered on July 28, 2020. However, Mrs. Khan waived any right to the Property pursuant to the terms of the Global Settlement Agreement and the July 28 Order. The Trustee has secured a non-insider buyer willing to purchase the Property according to the terms set forth in the Purchase Agreement. The Buyer (or such other non-insider willing to purchase the Property on terms equal to or better than the Offer), is willing to purchase the Property for $212,500. The Trustee has researched the market for the Property, including by obtaining an appraisal of the Property (Exhibit C). The Purchase Price approximates the pre-pandemic appraised value of the property, and no real estate agents will be involved in the transaction, which will eliminate any brokerage fees or commissions paid from the sale proceeds. In addition, the Property is a vacant lot in a 10-year old development in which numerous original lots remain unsold. Accordingly, the Trustee believes the Purchase Price is fair and reasonable. The sale to the Buyer is subject to Court approval and any better offers submitted to the Trustee up until the deadline to object to the sale. Better offers may (i) the Chapter 11 Trustee, Mark T. Iammartino, Development Specialists Inc., 10 S. LaSalle Street, Suite 3300, Chicago, IL 60603, e-mail be submitted, and so as to be received by Oct. 13, 2020, to: miammartino@dsiconsulting.com; and (ii) the counsel to the Trustee, McDonald Hopkins LLC, 300 N. LaSalle Street, Suite 1400, Chicago, IL 60654 (Attn: Nicholas M. Miller), email: nmiller@mcdonaldhopkins.com. In the event that there are competing bidders, the Chapter 11 Trustee will establish bidding procedures to obtain the highest purchase price. The Trustee asks that the Property be transferred to the Buyer free and clear of all Interests, with such Interests to attach to the proceeds of the sale. The Trustee asks that the Court enters an order authorizing the sale to take immediate effect notwithstanding Fed. R. Bankr. P. 6004(h). A copy of the Agreement is available at https://tinyurl.com/y38vuwww from PacerMonitor.com free of charge. About Najeeb Ahmed Khan Najeeb Ahmed Khan sought Chapter 11 protection (Bankr. W.D. Mich. Case No. 19-04258) on Oct. 8, 2019. The Debtor tapped Denise D. Twinney, Esq., and Robert F. Wardrop, II, Esq., at Wardrop & Wardrop. P.C., as counsel. On Oct. 29, 2019, the Court appointed Mark. T. Iammartino, as the Chapter 11 Trustee. On Nov. 1, 2019, the U.S. Trustee appointed an official committee of unsecured creditors. NAMASTE INDIAN CUISINE: Files for Chapter 7 Bankruptcy ------------------------------------------------------ Namaste Indian Cuisine LLC filed for voluntary Chapter 7 bankruptcy protection (Bankr. M.D. Tenn. Case No. 20-04271) on Sept. 22, 2020. According to the Nashville Business journal, the Debtor listed an address of 505 Bell Trace Ln., Antioch, and is represented in court by attorney Steven Lefkovitz. Namaste Indian Cuisine listed assets up to $30,000 and debts up to $135,181. The filing's largest creditor was listed as AM Investors LLC with an outstanding claim of $134,981. Namaste Indian Cuisine LLC is a restaurant that offers fine Indian cuisine, located in Crofton, Maryland. The Debtor's counsel: LEFKOVITZ AND LEFKOVITZ, PLLC Steven Lefkovitz Tel: 615-256-8300 E-mail: slefkovitz@lefkovitz.com NEUMEDICINES INC: Sets Bidding Procedures for All Assets -------------------------------------------------------- Neumedicines, Inc., asks the U.S. Bankruptcy Court for the Central District of California to authorize the bidding procedures in connection with the auction sale of substantially all assets. The majority of the Debtor's assets consist of its valuable intellectual property patents on its IL-12 drug HemaMaxTM, which has demonstrated anti-tumor effects and is being evaluated for use to generate sustained and durable anti-tumor responses, its inventory of HemaMax on hand and its cell lines. The Debtor believes that its assets are valued at not less than $25 million based on the estimated net present value of the offers received. The Debtor generates no income. While its overhead is minimal (approximately $20,000 to 25,000 per month), the expenses the Debtor must pay are critical as they support its valuable intellectual property and related assets. Based upon current operations, the Debtor projects that its company cash will be exhausted on Sept. 30, 2020. The Debtor has secured a loan from one of its directors, Dr. Raphael Nir, Ph.D., which subject to Court approval, will enable the Debtor to maintain its assets until the closing of the sale. Given the foregoing, it submits that it is critically important for a sale of its assets to be consummated as soon as possible. As there are at least two potential buyers, the Debtor believes that proceeding with the Bidding Procedures and Auction is the best way for the estate to realize the maximum value of its business and its assets. The Debtor has conducted extensive in person and telephonic negotiations with the two companies who wish to acquire the Purchased Assets. One buyer has been engaged in extensive diligence and is believed to be near completion. The other proposed buyer has completely its due diligence, waived that condition and is prepared to proceed to Auction subject to an agreed upon form of APA. The Debtor has exchanged detailed extensive terms sheets with both potential buyers. Both potential purchasers described made written offers to acquire the Purchased Assets on terms which include (i) non-contingent consideration of approximately $7 million payable at closing, which will pay all allowed claims in full and provide a significant distribution to the Debtor's shareholders; and (ii) $78 million in consideration which is contingent upon the occurrence of conditions believe to be extremely likely to occur under management of a biopharmaceutical company with the funds and expertise needed to complete the drug trials. By selecting one of these potential purchasers as a Stalking Horse, the Debtor will be able to negotiate an APA with such purchaser that will serve as the Template APA and increase the prospect of a competitive Auction that will maximize the value of its estate. The Break-Up Fee and expense reimbursement proposed by the Debtor will adequately compensate the Stalking Horse for those additional efforts while also maintaining an open environment for competitive bidding in preparation for the Auction. In connection with the Auction, the Debtor will provide such financial and operational information pertaining to its business and assets as is requested by any party, subject to the execution of a Confidentiality and Non-Disclosure Agreement and will embark on an orderly sale process, including contacting any other prospective buyers who have expressed an interest in acquiring its assets. In addition to providing notice of the Auction to all of the prospective buyers, the Debtor will provide notice of the Auction to all of its creditors and equity interest holders in the hope that some may be interested or may know of others who would be interested in purchasing the Assets. In order to maximize the value of the estate, the Debtor is asking that the Court approves the Bid Procedures Motion in order to conduct and orderly sale process designed to maximize value for the estate and provide prospective bidders with sufficient amount of time possible under the circumstances to (i) understand the Auction sale process, (ii) conduct due diligence, and (iii) formulate a purchase offer to be presented in connection with the Auction. The salient terms of the Bidding Procedures are: a. Bid Deadline: Five business days prior to the Auction b. Initial Bid: In addition to any debt that any Prospective Bidder desires to assume and any other form of consideration any Prospective Bidder desires to provide, a Prospective Bidder must agree to pay cash to the Debtor’s estate of not less than $5 million. c. Deposit: $500,000 d. Auction: The Debtor proposes that the Auction occur no later than Nov. 15, 2020, subject to the availability of the Court. e. Bid Increments: $50,000 f. Sale Hearing: Immediately after the conclusion of the Auction g. Closing: Nov. 30, 2020 h. Expense Reimbursement: $150,000 i. Break-up Fee: $175,000 The Debtor asks authority to designate a Stalking Horse Bidder 14 days in advance of the auction scheduled by the Court and approval of its Template Asset Purchase Agreement (which will be filed with the Court not less than seven days prior to the hearing on the Motion), and approval of the Notice and the scheduling an auction and the hearing to consider approval of the sale. A hearing on the Motion is set for Oct. 14, 2020 at 11:00 a.m. A copy of the Bidding Procedures is available at https://tinyurl.com/y2up7sue from PacerMonitor.com free of charge. About Neumedicines Inc. Neumedicines, Inc. is a clinical stage biopharmaceutical company in Arcadia, Calif., which is engaged in the research and development of HemaMax, recombinant human interleukin 12 (rHuIL-12), for the treatment of cancer in combination with standard of care (SOC, radiotherapy, chemotherapy, or immunotherapy) and Hematopoietic Syndrome of Acute Radiation Syndrome (HSARS) as a monotherapy. Visit https://www.neumedicines.com for more information. Neumedicines filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 20-16475) on July 17, 2020. In the petition signed by Timothy Gallaher, president, Debtor was estimated to have $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Judge Ernest M. Robles presides over the case. The Debtor has tapped Weintraub & Seth, APC as its bankruptcy counsel and Sheppard, Mullin, Richter & Hampton, LLP as its special counsel. NOBLE CORP: Gets Court OK to Solicit Bankruptcy Plan Votes ---------------------------------------------------------- Allison McNeely of Bloomberg News reports that Noble Corp. won court approval to gather support for its bankruptcy plan that would cut nearly all of its $4 billion of debt. The offshore service company's disclosure statement and proposed rights offering were approved by Judge David R. Jones in bankruptcy court Friday, October 9, 2020. Noble can proceed with soliciting stakeholder votes in support of its bankruptcy plan, with an aim to secure court approval of the restructuring at a hearing next month, according to a court filing. Noble proposes to borrow $675 million under a new first-lien credit facility provided by existing lenders. About Noble Corporation PLC Noble -- http://www.noblecorp.com/-- is an offshore drilling contractor for the oil and gas industry. Noble performs, through its subsidiaries, contract drilling services with a fleet of 25 offshore drilling units, consisting of 12 drillships and semisubmersibles and 13 jackups, focused largely on ultra-deepwater and high-specification jackup drilling opportunities in both established and emerging regions worldwide. Noble is a public limited company registered in England and Wales with company number 08354954 and registered office at 10 Brook Street, London, W1S 1BG England. Noble Corporation PLC and subsidiaries recorded a net loss of $874.37 million in 2019, a net loss of $1.13 billion in 2018, and a net loss of $493.93 million in 2017. As of Dec. 31, 2019, the Company had $8.28 billion in total assets, $4.62 billion in total liabilities, and $3.66 million in total equity. * * * As reported by the TCR on April 24, 2020, S&P Global Ratings lowered its issuer credit rating on U.K.-based offshore drilling contractor Noble Corp. PLC to 'CCC-' from 'CCC+'. S&P said the collapse in oil prices has led to a sharp drop in demand for oilfield services, and it expects offshore activity levels to be hit particularly hard. NUTRACEUTICAL INT'L: Moody's Withdraws B3 CFR Upon Debt Repayment ----------------------------------------------------------------- Moody's Investors Service withdrawn Nutraceutical International Corporation's ratings including the B2 Corporate Family Rating (CFR), the B2-PD Probability of Default Rating (PDR), and the B1 rating on the company's senior secured first lien bank credit facilities, consisting of a $20 million first lien revolver due 2022 and a $248 million first lien term loan due 2023. The rating action follows the full repayment and cancelation of its credit facilities. The following ratings/assessments are affected by The action: Withdrawals: Issuer: Nutraceutical International Corporation Corporate Family Rating, Withdrawn, previously rated B2 Probability of Default Rating, Withdrawn, previously rated B2-PD $20 Million Senior Secured First Lien Revolving Credit Facility due 2022, Withdrawn, previously rated B1 (LGD3) $248 Million Senior Secured First Lien Term Loan due 2023, Withdrawn, previously rated B1 (LGD3) Outlook Actions: Issuer: Nutraceutical International Corporation Outlook, Withdrawn, previously rated Stable RATINGS RATIONALE Moody's has decided to withdraw the ratings because Nutraceutical's debt previously rated by Moody's has been fully repaid following Nutraceutical's debt refinancing. Nutraceutical, headquartered in Park City, Utah, is a manufacturer and distributor of dietary supplements, personal care and healthy foods. The company is focused primarily in the health food store channel. Some of the company's core products include Solaray, Kal, Zhou Nutrition, Dynamic Health, Life-Flo and Heritage Store. The company is owned by private equity firm HGGC, LLC. Nutraceutical generates roughly $235 million in annual revenues. ODYSSEY ENGINES: Seeks to Use Cash Collateral --------------------------------------------- Odyssey Engines LLC and its debtor-affiliates ask the U.S. Bankruptcy Court for the Southern District of Florida, Miami Division, to enter an order authorizing their continued use of cash collateral to pay operating expenses, payroll and related expenses, and the payment to vendors and suppliers. Synovus Bank asserts a lien on some or all of the Debtors' assets, including, its cash and other manifestations of ready funds. Preferred Bank may also allege a lien on the Debtors' Cash Collateral. The Debtors, without agreeing that Preferred or Synovus in fact has a valid lien on the Cash Collateral, state the Banks' claims are at least sufficiently colorable to require the filing and granting of the Motion pursuant to Section 363 of the Bankruptcy Code. Among other reasons, the impact of the Covid Pandemic has been disastrous to the Debtors and to the airline industry generally. The businesses used to produce cash flow nearly sufficient to maintain themselves and pay their basic operating costs. The Covid Pandemic continues to hamper, almost completely, that ability. The Debtors also seek the entry of an Order authorizing them to borrow cash from their various owners, to wit: David Alan Boyer and Joel Plasco -- or entities under their control -- or from third parties with which they have relationships. The Owners are prepared to fund any cash shortfalls from the operations of the Debtors, excluding debt service. The Debtors also request that, subject to a determination of the Banks' interest in the Debtors' collateral, the Banks be granted replacement liens in post-petition assets, to the same extent and priority as their alleged pre-petition liens and security interests. The Debtors note that the Banks are also adequately protected by the infusions of cash contemplated by the Owners. These infusions can only enhance the value of the alleged collateral. A copy of the Debtors' motion is available at https://bit.ly/30x1MyT from PacerMonitor.com. About Odyssey Engines LLC Odyssey Engines, LLC and its affiliates own, lease and maintain aircraft engines. On June 23, 2020, Odyssey Engines and its affiliates concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Lead Case No. 20-16772). The petitions were signed by David Alan Boyer, president. At the time of the filing, each Debtor disclosed assets of $1 million to $10 million and liabilities of $10 million to $50 million. Judge Robert A. Mark oversees the cases. The Debtors have tapped David R. Softness, P.A. as legal counsel; GGG Partners, LLC as chief restructuring officer; Bedford Advisers as financial advisor; and Pat Duggins Consulting Services Inc. as appraiser. Synovus Bank is represented by Daniel Gold, Esq. -- Daniel.gold@bipc.com -- at Buchanan Ingersoll & Rooney as counsel. Preferred Bank is represented by Daniel DeSouza, Esq. -- ddesouza@desouzalaw.com -- as counsel. OMNI SPECIALIZED: Trustee Selling Remnant Assets to Oak for $5K --------------------------------------------------------------- Jeana K. Reinbold, the Chapter 7 Trustee for the bankruptcy estate of Omni Specialized, LLC, asks the U.S. Bankruptcy Court for the Central District of Illinois to authorize the sale of remnant assets, consisting of known or unknown assets or claims, which have not been previously sold, assigned, or transferred, to Oak Point Partners, LLC for $5,000, subject to overbid. Since being appointed, the Trustee has administered the Estate for the benefit of its creditors in accordance with her power and duties. She is now in the process of winding down the administration of the case. To that end, she has engaged in efforts to ensure that the maximum value of the Estate's remaining assets is realized, which efforts include pursuing the sale of any remaining assets. The Trustee has determined that there might exist property of the Estate, consisting of the Remnant Assets. Potential unknown assets might include unscheduled refunds, overpayments, deposits, judgments, claims, or other payment rights that would accrue in the future. The Trustee has conducted due diligence and remains unaware of the existence of any Remnant Assets, and certainly none that could return value to the Estate greater than the Purchase Price. Accordingly, she has determined that the cost of pursuing the Remnant Assets will likely exceed the benefit that the Estate would possibly receive on account of the Remnant Assets. The Trustee and the Buyer have negotiated their Asset Purchase Agreement for the sale of all the Remnant Assets for $5,000. In accordance with the APA, the Remnant Assets do not include (i) cash held at the time of the APA in the Trustee's fiduciary bank account for the Debtor's case; provided, however, that any cash that exists in such bank account one year after the date of the closing of the Debtor's case will be Remnant Assets; (ii) any and all Goods (e.g., office furniture) of the Estate; (iii) the claims, and related litigation and settlement proceeds, including those pursuant to that certain Settlement and Release Agreement, pending Court approval, held by the Estate against Donald A. Orr, Christine Orr, Thomas Witt, and Janet Witt, as asserted in Adv. Proc. No. 19-8035; and (iv) the Purchase Price for the Remnant Assets. Contemporaneously with the Motion, the Trustee has submitted to the Court a notice of the Motion, with which the Court will set the Response Deadline. While she is prepared to consummate the sale of the Remnant Assets to Oak Point pursuant to the terms set forth and in the Purchase Agreement, in the event a party other than Oak Point wishes to purchase the Remnant Assets, the Trustee asks that the Court approves the following Bidding Procedures: a. Each Competing Bidder who wants to participate in the overbid process must notify the Trustee of their intention to do so in accordance with the Notice on or before the Response Deadline; b. the first overbid for the Remnant Assets by a Competing Bidder must be at least $2,000 more than the Purchase Price, or a total of $7,000; c. each Competing Bidder must submit a Cashier's Check to the Trustee in the amount of such Competing Bidder's first overbid at the time such overbid is made; d. each subsequent overbid for the Remnant Assets must be in additional increments of $1,000, unless otherwise agreed by the parties or directed by the Court; e. the bidder must purchase the Remnant Assets under the same terms and conditions set forth in the Purchase Agreement, other than the purchase price; and f. in the event of an overbid that meets the foregoing conditions, the Trustee will schedule an auction of the Remnant Assets in advance of the hearing date and will request that the Court approve the winning bidder at the auction as the purchaser at the hearing on the Motion. The Trustee believes that the sale of the Remnant Assets in accordance with the terms of the Purchase Agreement, and as provided in the Motion, serves the best interests of the Estate and creditors, as the sale will allow her to realize additional funds for the benefit of the Estate. Finally, to successfully implement the Purchase Agreement, the Trustee also asks a waiver of the 14-day stay under Bankruptcy Rule 6004(h). A copy of the APA is available at https://tinyurl.com/y5o9gxlt from PacerMonitor.com free of charge. About Omni Specialized Omni Specialized, LLC -- https://www.omnispecialized.com/ -- is an over-dimensional and general commodity carrier serving 48 states. The Company claims to have an outstanding reputation for safe, reliable service along with a large selection of specialized trailers. Omni's fleet of specialized and general commodity equipment includes a 100% complement of 53 flatbed and low-profile stepdecks with RGN Double-Drop trailers. The Debtor sought Chapter 11 protection (Bankr. C.D. Ill. Case No. 17-80801) on May 29, 2017. Judge Thomas L. Perkins is assigned to the case. The Debtor estimated assets and liabilities in the range of $1 million to $10 million. the Debtor tapped Gregory Otsuka, Esq., at Hellmuth & Johnson, PLLC as counsel. The petition was signed by Thomas Witt, manager. On June 22, 2017, the Debtor's case was converted to a case under chapter 7. Jeana K. Reinbold was appointed as chapter 7 trustee on the same date. ONCE A DOG: Shareholder Buying Frederick Property for $1 Million ---------------------------------------------------------------- Once A Dog, Inc., asks the U.S. Bankruptcy Court for the District of Maryland to authorize the sale of the improved real property located at 6 S. Bentz St., Frederick, Maryland, to David Schiller for $1 million, free and clear of all liens, claims, encumbrances and interests Among the assets of the bankruptcy estate is the interest of the Debtor in the Property. The Debtor is owned by these individuals who hold stock interests as follows: Eugene Souder President, Shareholder 32% Interest David Schiller VP, Secretary, Shareholder 32% Interest John Duchaj Shareholder 10% Interest Lori Herman Shareholder 1.5% Interest H. Shelby Scaggs, III Shareholder 10% Interest Bruce Meyers Shareholder 0.5% Interest Scott Speier Shareholder 0.5% Interest Robert Bourgeois Shareholder 4% Interest Mitch Meyers Shareholder 0.5% Interest Mike Sloan Shareholder 2% Interest Mike Gurevich Shareholder 0.5% Interest Mark Lawson Shareholder 1.5% Interes Kim Daitch Shareholder 1% Interest George Miller, III Shareholder 1% Interest Edward Smith Shareholder 1.5% Interest Douglas Seigal Shareholder 1% Interest Estate of Brian Woods Shareholder 0.5% Interest The Debtor leased its sole parcel of improved real property, the Property, to a series of bar and restaurant businesses, but consistently lost money year over year. The last tenant, without notice, vacated the premises abandoning its lease obligations in 2019. The business premises are not currently leased. The residential units on the second floor have been leased. The outstanding loans on the building exceed the fair market value of the Property. The Debtor had determined that its best prospect was to cut its losses and sell the Property. It was unable to resolve the specifics of a sale of the Property internally, because it required the unanimous consent of its shareholders. David Schiller was one of the petitioning creditors who filed the involuntary petition against the Debtor resulting in the Order for Relief being entered. Since the Debtor has entered bankruptcy, Eugene Souder has acted as the manager of the DIP. Schiller has not been involved in the management of the Debtor. Over the years, in order to avoid default by the Debtor of its financial obligations to its secured creditors, Schiller had lent and or advanced significant amounts of money to continue the operations. The Debtor from 2008 until November 2019, immediately preceding the involuntary bankruptcy filing, had accepted the loans and it paid interest to Schiller on his loans. There have been numerous corporate meetings over the years discussing the debt, the Debtor's operations, the value of the Property, and sale of the Property. In 2019, with the loss of the last business tenant, the majority shareholders called a meeting to discuss the debt of the corporation, reviewed options regarding the fate of the corporation including dissolution, bankruptcy and the potential sale of transfer of the Property. After that meeting, it was agreed by the majority shareholders, including by Duchaj and by Herman, that the Property would be listed for sale with a licensed Frederick commercial realtor for $1.2 million dollars. Ken Breen was hired as realtor, and the Property was listed and advertised for sale. Today the Covid 19 pandemic has occurred further impacting the operation of the Debtor's business and the value of its property. David Schiller has offered $1 million to purchase the Property. The Debtor agrees that Schiller's offer is fair and reasonable. On the Debtor's Schedule A, the Property's value was estimated to be $850,000. On the Debtor's Schedule D, creditor Sandy Spring Bank's secured claim for its first priority mortgage deed of trust is given as $498,644. Sandy Spring Bank has not yet filed a Proof of Claim. On the Debtor's Schedule D, creditor Sidney Schiller's secured claim for her second priority deed of trust is given as $143,846. Sidney Schiller has not yet filed a Proof of Claim. On the Debtor's Schedule E/F, a total of $418,322 in unsecured claims are given. Two creditors have filed Proofs of Claim: Potomac Edison in amount $494 and David Schiller in amount $413,500. The Debtor has filed, by separate motion filed contemporaneously with the Motion, an objection to the proof of claim of David Schiller to determine the amount thereof. The Debtor desires to sell the subject Property satisfying the liens of Sandy Spring Bank and Sidney Schiller, and to use the net proceeds of sale to fund its Chapter 11 Plan filed separately and contemporaneously with the Motion. About Once A Dog Inc. Once A Dog, Inc.is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). On March 9, 2020, creditor Sidney Schiller filed an involuntary petition against Once A Dog under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Md. Case No. 20-13102). The case is assigned to Judge Thomas J. Catliota. Wolff & Orenstein, LLC is Debtor's legal counsel. OUTLOOK THERAPEUTICS: Gets Noncompliance Notice from Nasdaq ----------------------------------------------------------- Outlook Therapeutics, Inc., received a written notification from the Listings Qualifications Department of The Nasdaq Stock Market LLC on Oct. 8, 2020, that the bid price for the Company's common stock had closed below the minimum $1.00 bid price requirement for continued listing on The Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(a)(2), for the 30-business day period ended Oct. 7, 2020. Under Nasdaq Listing Rule 5810(c)(3)(A), the Company has a grace period of 180 calendar days, through April 6, 2021, to evidence compliance with the Rule. In order to satisfy the Rule, the Company must evidence a closing bid price of at least $1.00 per share for a minimum of 10 consecutive business days (and generally not more than 20 business days) on or before April 6, 2021. The notice has no effect on the listing or trading of the Company's common stock on Nasdaq at this time. If the Company does not regain compliance with the Rule prior to the expiration of the 180-day compliance period, under Nasdaq Listing Rule 5810(c)(3)(A)(ii), if the Company meets the continued listing requirement for market value of publicly held shares and all other applicable standards for initial listing on The Nasdaq Capital Market, with the exception of the minimum bid price requirement, it will be afforded an additional 180-day compliance period, unless the Company does not indicate its intent to cure the deficiency, or if it does not appear to Nasdaq that it is possible for the Company to cure the deficiency, in which case the Company will not be eligible for the additional compliance period. If the Company is unable to regain compliance during the 180-day period (and the additional compliance period, if available), the Company's common stock will be subject to delisting. The Company intends to actively monitor the minimum bid price of its common stock and may, as appropriate, consider available options to regain compliance with the Rule. About Outlook Therapeutics Outlook Therapeutics, Inc., formerly known as Oncobiologics, Inc. -- http://www.outlooktherapeutics.com/-- is a late clinical-stage biopharmaceutical company working to develop the first FDA-approved ophthalmic formulation of bevacizumab for use in retinal indications, including wet AMD, DME and BRVO. If ONS-5010, its investigational ophthalmic formulation of bevacizumab, is approved, Outlook Therapeutics expects to commercialize it as the first and only on-label approved ophthalmic formulation of bevacizumab for use in treating retinal diseases in the United States, Europe, Japan and other markets. Outlook Therapeutics reported a net loss attributable to common stockholders of $36.04 million for the year ended Sept. 30, 2019, compared to a net loss attributable to common stockholders of $48.02 million for the year ended Sept. 30, 2018. As of June 30, 2020, the Company had $30.24 million in total assets, $19.28 million in total liabilities, and $10.96 million in total stockholders' equity. KPMG LLP, in Philadelphia, Pennsylvania, the Company's auditor since 2015, issued a "going concern" qualification in its report dated Dec. 19, 2019, on the consolidated financial statements for the year ended Sept. 30, 2019, citing that the Company has incurred recurring losses and negative cash flows from operations and has a stockholders' deficit of $16.1 million, $6.7 million of convertible senior secured notes that become due on Dec. 22, 2019, $3.6 million of unsecured indebtedness due on demand and $1.0 million of unsecured indebtedness also due on demand, but subject to a forbearance agreement through March 2020, that raise substantial doubt about its ability to continue as a going concern. PATRICK JAMES: Files for Chapter 11 Bankruptcy Protection --------------------------------------------------------- The Business Journal reports that Fresno men's clothing store Patrick James, a Fresno institution that has been clothing business professionals for nearly 60 years, is the latest apparel retailer to file for bankruptcy protection. Founded in Fresno by Patrick Mon Pere Sr. in 1962, Patrick James has survived some of the country's worst economic declines while employing hundreds of people as a family-owned business with locations in three different states. Since his father's passing in 2018, Pat Mon Pere, Jr., president of Patrick James, is looking ahead to the future of the company. "It is with a heavy heart that we announce the current state of the Company with the new filing of Chapter 11," explains Pat Mon Pere. "As we work with our partners and ask for their grace, we will emerge from the filing as a healthier company moving forward, continuing to serve our communities as we have been since 1962." The filing in federal bankruptcy court was made Oct. 9, 2020. A voluntary petition filed with the court lists more than $3.24 million in debt to Patrick James' 20 largest creditors. As part of the bankruptcy plan, Patrick James has secured a commitment to use cash collateral and debtor-in-position financing from existing lender UMB Bank, N.A. to continue operation. Patrick James closed a 40-year-old location in Palo Alto last month, and plans to relocate or reduce in number its remaining 11 brick-and-mortar locations in California, Nevada and Arizona. About James Patrick Patrick James, Inc. -- https://patrickjames.com/ -- is Fresno, California-based retailer of men's apparel. It offers sport shirts, trousers, sweaters, leather jackets, activewear, footwear, accessories, and more. Patrick James sought Chapter 11 protection (Bankr. E.D. Cal. Case No. 20-13293) on Oct. 9, 2020. The Debtor was estimated to have assets and liabilities of $1 million to $10 million. The Hon. Jennifer E. Niemann is the case judge. The company's restructuring counsel is Hagop T. Bedoyan of McCormick Barstow, Sheppard, Wayte & Carruth in Fresno. Its financial advisor is Michael Bergthold of Stapleton Group. PRESSER CONSTRUCTION: Taps Corral Vela as Litigation Counsel ------------------------------------------------------------ Presser Construction, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ Corral Vela as its special litigation counsel. The firm will render the following services: a. assist the Debtor with the resolution of contested claims; b. advise the Debtor with regard to civil litigation matters; c. prepare pleadings; d. provide other litigation services. The firm's services will be provided mainly by Adam Corral, Esq., who will be paid at the rate of $350 per hour. Mr. Corral disclosed in court filings that he is a "disinterested person" within the definition of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Adam Corral Corral Vela, LLP 7103 Broadway St. Pearland, TX 77581 Tel: (346) 444-8352 Fax: (346) 444-8355 About Presser Construction Presser Construction, Inc. provides oil and gas pipeline construction, dirt work services, utility construction, hydrovac services, and railroad construction services. Visit https://presserconstruction.com for more information. Presser Construction filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-33986) on Aug. 6, 2020. Joseph L. Presser, Jr., president and chief executive officer, signed the petition. At the time of the filing, Debtor disclosed total assets of $304,875 and total liabilities of $4,556,974. Judge Eduardo V. Rodriguez oversees the case. James Q. Pope, Esq., at The Pope Law Firm, is Debtor's legal counsel. PURDUE PHARMA: Caplin 2nd Updated List of Govt. Entities -------------------------------------------------------- Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure, the law firm of Caplin & Drysdale, Chartered submitted a second amended verified statement to disclose an updated list of Multi-State Governmental Entities Group in the Chapter 11 cases of Purdue Pharma L.P., et al. On October 30, 2019, the MSGE Group filed with the Court its Verified Statement Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure [ECF No. 409]. The MSGE Group's membership has since increased to approximately 1,317 entities: 1,245 cities, counties and other governmental entities, 9 tribal nations, 13 hospital districts, 16 independent public school districts, 32 medical groups, and 2 funds across 38 states and territories. Caplin & Drysdale, Chartered serves as bankruptcy counsel to the MSGE Group. A list of the MSGE Group's members as of the current date is attached hereto as Exhibit A. As of Oct. 9, 2020, members of the Governmental Entities and their disclosable economic interests are: Economic Interest ----------------- City of Tarrant Unliquidated Claim Alabama Schumacher Medical Unliquidated Claim Corporation of Alabama, Inc. Alabama Apache County Unliquidated Claim Arizona Bullhead City Unliquidated Claim Arizona City of Glendale Unliquidated Claim Arizona City of Prescott Unliquidated Claim Arizona City of Surprise Unliquidated Claim Arizona La Paz County Unliquidated Claim Arizona Pinal County Unliquidated Claim Arizona Alicia Unliquidated Claim Arkansas Almyra Unliquidated Claim Arkansas Alpena Unliquidated Claim Arkansas Amagon Unliquidated Claim Arkansas Anthonyville Unliquidated Claim Arkansas Arkansas County Unliquidated Claim Arkansas Ashley County Flat Unliquidated Claim Arkansas Avoca Unliquidated Claim Arkansas Banks Unliquidated Claim Arkansas Bauxite Unliquidated Claim Arkansas Baxter County Unliquidated Claim Arkansas The information set forth in Exhibit A, which is based on information provided by the applicable members of the MSGE Group through their counsel to Caplin & Drysdale, is intended only to comply with Rule 2019 of the Federal Rules of Bankruptcy Procedure and is not intended for any other purpose. The MSGE Group makes no representation herein as to the amount, validity, or priority of any particular member's claims and reserves all respective rights thereto. This Amended Verified Statement and the attached Exhibit A should not be read as to waive or limit any of the rights of the MSGE Group or its members to assert, file, or amend any claims in accordance with applicable procedures established by this Court. The MSGE Group reserves the right to further amend or supplement this Second Amended Verified Statement as necessary in accordance with Rule 2019 of the Federal Rules of Bankruptcy Procedure. Counsel for the Multi-State Governmental Entities Group can be reached at: Caplin & Drysdale, Chartered Kevin C. Maclay, Esq. Todd E. Phillips, Esq. Ann Weber Langley, Esq. George M. O'Connor, Esq. One Thomas Circle, NW, Suite 1100 Washington, DC 20005 Tel: (202) 862-5000 Fax: (202) 429-3301 E-mail: kmaclay@capdale.com tphillips@capdale.com alangley@capdale.com goconnor@capdale.com A copy of the Rule 2019 filing, downloaded from PacerMonitor.com, is available at https://bit.ly/3lAbeJN About Purdue Pharma 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. RANDAL L. LOEHRKE: Selling Saxeville Residential Home for $82.5K ---------------------------------------------------------------- Randal L. Loehrke and Marjorie K. Loehrke ask the U.S. Bankruptcy Court for the Eastern District of Wisconsin to authorize the sale of the residential home located at N7189 29th Drive, Town of Saxeville, Waupaca, Wisconsin, Tax Parcel No. 030-00224-0200, to Brandon R. Loehrke for $82,500. The Debtors are the owners of the Property. An offer to purchase the Property was submitted by the Buyer in the amount of $82,500, in accordance with the terms of the Offer to Purchase and the Amendment. The Offer was amended on Aug. 31, 2020. On the Petition Date, the Debtors were indebted to the Walworth County Treasurer for real estate taxes owed on the Property for 2018 in the amount of $748. Interest is accruing on the foregoing indebtedness at the rate of 12% per annum. That interest rate is the highest interest rate being charged by the Debtors' creditors. First National Bank & Trust Co., also known as Bank First, NA, holds three property perfected mortgages on the Property. The Mortgages have all been recorded in the Waushara County Register of Deeds Office as Document Numbers 495420, 510008, and 514806. As of the date of the Motion, the Debtor is indebted to the Bank in the amount of $1,315,926. The Mortgages are also recorded against the properties listed on Exhibit C. The Debtors ask authority to sell the Property free and clear of all liens, claims, encumbrances, and interests, with all net proceeds, except as requested, to be applied to the total liability due and owing the Bank. The Debtors ask authority to pay (i) all usual and customary closing costs, including but not limited to, title insurance, transfer fees, real estate taxes, and recording fees; (ii) the Treasurer $748 for the real estate taxes owed on the Property from the sale proceeds; and (iii) First National Bank the remaining funds from the sale. Payment of proceeds from the sale of the Property to First National Bank upon closing is in the best interest of the bankruptcy estate, as doing so will reduce the debt owed the Bank more quickly and, therefore, as the Debtors sell other real property, there will be more net sale proceeds available to pay their other creditors. A copy of the Agreement and Exhibit C is available at https://tinyurl.com/y5ne9vsq from PacerMonitor.com free of charge. Randal L. Loehrke and Marjorie K. Loehrke sought Chapter 11 protection (Bankr. E.D. Wisc. Case No. 20-24784) on July 9, 2020. The Debtors tapped Michelle A. Angell, Esq., at Krekeler Strother, S.C. as counsel. REGIONAL SITE: Unsecured Creditors to Have 10% Recovery in Plan --------------------------------------------------------------- Debtor Regional Site Solutions, Inc., filed the Disclosure Statement for the Second Plan of Liquidation Dated August 21, 2020. This Plan contemplates payments to the various classes of creditors from Earnings received from the wind down of operations and the liquidation of assets. Based on the value of Debtor’s assets, including real and personal property and accounts receivables, it is estimated that unsecured creditors shall receive, after payment of administrative costs and priority claims, a dividend of ten percent (10%) on their Allowed Claims based on the liquidation value of the estate. Regional owns real property at 5985 Old Mendenhall Road, Archdale, NC 27263 which it proposes to liquidate in an orderly fashion using a real estate broker. Funds from any sale of the properties after approved closing cost will first be used to pay creditors with a security interest on the Real Property with any remaining funds being used to pay creditors pursuant to priorities as set forth in this Plan. Class XIV - General Unsecured Creditors. Each holder of an Allowed Unsecured Claim shall be paid a pro rata amount from the funds received from the liquidation of the Debtor’s assets after all classes with superior claims are paid in full. Debtor shall make distributions pursuant to terms set forth in Wind Down and Liquation Section as funds allow upon payment in full of superior liens. The provisions of the Plan call for the wind down of the Debtor’s operations and the orderly liquidation of its assets. As is more fully set forth in the section for Wind Down and Liquation, Sale Procedure for Sale of Real Property and Article I, this is a Plan of Liquidation and not a Plan of Reorganization. As such the source of funds shall be the liquidation of the Debtor’s assets, the collections of outstanding accounts receivables and funds obtained from the completion of current outstanding jobs. A full-text copy of the Amended Plan dated August 21, 2020, is available at https://tinyurl.com/yyglgfhq from PacerMonitor at no charge. Attorney for the Debtor: Dirk W Siegmund Ivey, McClellan, Gatton & Siegmund Greensboro, North Carolina 27402 Telephone: (336) 274-4658 Facsimile: (336) 274-4540 About Regional Site Solutions Regional Site Solutions, Inc., is a privately held company that operates in the surfacing and paving business. Regional Site Solutions sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D.N.C. Case No. 19-11191) on Oct. 28, 2019. At the time of the filing, the Debtor was estimated to have assets of between $500,000 and $1 million and liabilities of between $1 million and $10 million. The case is assigned to Judge Lena M. James. Dirk W. Siegmund, Esq., at Ivey, McClellan, Gatton & Siegmund, LLP, is the Debtor's legal counsel. RESTAURANT 104: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------- Debtor: Restaurant 104 LLC DBA Hudson Grille Sandy Springs 183 12th Street, NE Atlanta, GA 30309 Business Description: The Debtor operates the Hudson Grille restaurant located in Sandy Springs, Georgia. Chapter 11 Petition Date: October 13, 2020 Court: United States Bankruptcy Court Northern District of Georgia Case No.: 20-70720 Debtor's Counsel: J. Robert Williamson, Esq. SCROGGINS & WILLIAMSON, P.C. 4401 Northside Parkway Suite 450 Atlanta, GA 30327 Tel: 404-893-3880 Email: centralstation@swlawfirm.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Jeffrey R. Landau, managing member. A copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/2B7TTSA/Restaurant_104_LLC__ganbke-20-70720__0001.0.pdf?mcid=tGE4TAMA REVELANT HOLDINGS: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Revelant Holdings, LLC DBA Enercat USA, LLC DBA Revelant, LLC 4611 Plettner Lane Suite 200 Evergreen, CO 80439 Business Description: Revelant Holdings, LLC -- https://revelant.com -- is a technology company bringing the Enercat tool to the oil and gas industry as an entirely new and innovative way to improve the properties of fluids downhole and at the surface. With its corporate office now in Houston and four regional USA offices serving the oil & gas industry, Revelant is currently focusing on the Permian Basin, Eagle Ford, Mid-Continent and San Juan Basin. Chapter 11 Petition Date: October 12, 2020 Court: United States Bankruptcy Court District of Colorado Case No.: 20-16717 Judge: Hon. Michael E. Romero Debtor's Counsel: Jeffrey A. Weinman, Esq. WEINMAN & ASSOCIATES, P.C. 730 17th Street, Suite 240 Denver, CO 80202 Tel: (303) 572-1010 Email: jweinman@weinmanpc.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by W. Tracy Fotiades, president. A copy of the Debtor's list of 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/TPCR3LA/Revelant_Holdings_LLC__cobke-20-16717__0003.0.pdf?mcid=tGE4TAMA A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/O7WNHVQ/Revelant_Holdings_LLC__cobke-20-16717__0001.0.pdf?mcid=tGE4TAMA RISEN INC: Case Summary & 2 Unsecured Creditors ----------------------------------------------- Debtor: Risen, Inc. 1220 NW Murphy Blvd. Joplin, MO 64801 Business Description: Risen, Inc. is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: October 13, 2020 Court: United States Bankruptcy Court Western District of Missouri Case No.: 20-30430 Debtor's Counsel: Norman E. Rouse, Esq. COLLINS, WEBSTER, & ROUSE, PC 5957 East 20th Street Joplin, MO 64801-8765 Tel: 417-782-2222 Fax: 417-782-1003 Email: twelch@cwrcave.com Estimated Assets: $0 to $50,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Garrett Reincke, president/CEO. A copy of the petition containing, among other items, a list of the Debtor's two unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/H4BXBZA/Risen_Inc__mowbke-20-30430__0001.0.pdf?mcid=tGE4TAMA ROCHESTER DRUG: Merck Sharpe Says Plan Unconfirmable ---------------------------------------------------- Merck Sharpe & Dohme Corp., for itself and on behalf of its subsidiaries and affiliates, objects to the Disclosure Statement to Accompany Chapter 11 Plan of Liquidation of Debtor Rochester Drug Cooperative, Inc. Merck objects to the approval of the Disclosure Statement on the basis that the Disclosure Statement lacks adequate information and the Plan in its present form does not meet the requirements of section 1129(a)(1) of the Bankruptcy Code. Merck also joins in the objections of the Office of the United States Trustee on these and similar grounds. Merck believes the Plan contains provisions that make it unconfirmable, and while Merck reserves all rights to object to the Plan and is not waiving any rights, Merck believes it is appropriate to raise these issues at this time. Merck files this objection now to preview its view that there are a number of overreaching and problematic provisions while Merck recognizes that certain of these issues are issues for consideration at a hearing on confirmation of the Plan. A full-text copy of Merck's objection to disclosure and plan of liquidation dated August 21, 2020, is available at https://tinyurl.com/y5w53pse from PacerMonitor.com at no charge. Counsel to Merck: Jeffrey A. Dove Barclay Damon LLP Barclay Damon Tower 125 East Jefferson Street Syracuse, New York 13202 Telephone: (315) 703-7346 Email: jdove@barclaydamon.com -and- Rosa J. Evergreen, Esq. (admitted pro hac vice) ARNOLD & PORTER KAYE SCHOLER LLP 601 Massachusetts Ave., NW Washington, District of Columbia 20001 Telephone: (202) 942-5572 Email: rosa.evergreen@arnoldporter.com About Rochester Drug Co-Operative Rochester Drug Cooperative, Inc., is an independently owned New York cooperative corporation formed in 1905 and incorporated in 1948 with a principal office and place of business located at 50 Jet View Drive, Rochester, New York 14624. Its principal business is to warehouse, merchandise, and then distribute, on a cooperative basis, drugs, pharmaceutical supplies, medical equipment and other merchandise commonly sold in drug stores, pharmacies, health and beauty stores, and durable medical equipment business. It is a wholesale regional drug cooperative that operates as both a buying cooperative and a traditional drug distribution company created for the purpose of helping independent pharmacies compete in the current healthcare environment. Rochester Drug Cooperative sought Chapter 11 protection (Bankr. W.D.N.Y. Case No. 20-20230) on March 12, 2020, for the purpose of winding-down the Debtor's operations and liquidating its assets. The Debtor was estimated to have $50 million to $100 million in assets and $100 million to $500 million in liabilities. The Hon. Paul R. Warren is the case judge. The Debtor tapped Bond, Schoeneck & King, PLLC, led by Stephen A. Donato, as counsel and Epiq Corporate Restructuring, LLC as the claims and noticing agent. ROCHESTER DRUG: U.S. Trustee Objects to Plan Disclosures -------------------------------------------------------- William K. Harrington, the United States Trustee for Region 2, objects to the Disclosure Statement explaining the Chapter 11 Plan of Liquidation of debtor Rochester Drug Cooperative, Inc. The United States Trustee claims that the Disclosure Statement should not be approved because it fails to provide creditors with sufficient information to allow them to make an informed choice as to whether to accept or reject the Debtor's Chapter 11 Plan of Liquidation dated July 21, 2020. The United States Trustee points out that the Disclosure Statement fails to fully articulate the reasons and under what legal theory it proposes to award a KEIP, CEO Incentive Payments and a KERP that have not been approved by the Court pursuant to 503 of Title 11 of the United States Code. This missing information is crucial for a creditor to make an informed decision whether to accept or reject the Plan. The United States Trustee asserts that the Disclosure Statement fails to adequately explain an estimate and appraisal of assets and, distributions to be made. In that regard, the Debtor does not provide any information as to the amounts that could be recovered on a claim by a general unsecured creditor. In that same regard, there are no timelines, dates, conditions or deadlines for distributions except for distributions to M&T Bank on a "rolling basis". The United States Trustee further asserts that the Liquidating Trust Agreement contains vital and material information that should not be disclosed at such a late date. As this information is not contained in the Disclosure Statement, the Disclosure Statement does not contain adequate information and cannot be approved. The United States Trustee states that the Debtor includes language to receive a discharge in the Disclosure Statement which is impermissible pursuant to the plain language of Section 1141(d)(3) of the Bankruptcy Code. Thus, any reference to a discharge should be excluded from the Plan and Disclosure Statement. A full-text copy of the U.S. Trustee's objection to the Plan of Liquidation dated August 21, 2020, is available at https://tinyurl.com/y6xm52rz from PacerMonitor.com at no charge. About Rochester Drug Co-Operative Rochester Drug Cooperative, Inc., is an independently owned New York cooperative corporation formed in 1905 and incorporated in 1948 with a principal office and place of business located at 50 Jet View Drive, Rochester, New York 14624. Its principal business is to warehouse, merchandise, and then distribute, on a cooperative basis, drugs, pharmaceutical supplies, medical equipment and other merchandise commonly sold in drug stores, pharmacies, health and beauty stores, and durable medical equipment business. It is a wholesale regional drug cooperative that operates as both a buying cooperative and a traditional drug distribution company created for the purpose of helping independent pharmacies compete in the current healthcare environment. Rochester Drug Cooperative sought Chapter 11 protection (Bankr. W.D.N.Y. Case No. 20-20230) on March 12, 2020, for the purpose of winding-down the Debtor's operations and liquidating its assets. The Debtor was estimated to have $50 million to $100 million in assets and $100 million to $500 million in liabilities. The Hon. Paul R. Warren is the case judge. The Debtor tapped Bond, Schoeneck & King, PLLC, led by Stephen A. Donato, as counsel and Epiq Corporate Restructuring, LLC as the claims and noticing agent. RSG INDUSTRIES: 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 RSG Industries Corp., according to court dockets. About RSG Industries Corp. RSG Industries Corp. sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-19238) on Aug. 26, 2020, listing under $1 million in both assets and liabilities. Judge Scott M. Grossman oversees the case. Chad Van Horn, Esq., at Van Horn Law Group, P.A., is the Debtor's legal counsel. RUBY TUESDAY: Gets Court Permission to Tap $18.5 Mil. Ch. 11 Loan ----------------------------------------------------------------- Law360 reports that bankrupt casual restaurant dining chain Ruby Tuesday received permission Oct. 9, 2020, from a Delaware judge to tap into a portion of an $18.5 million debtor-in-possession loan that will help fund its operations as it pursues a Chapter 11 reorganization. During a hearing conducted virtually, debtor attorney Maxim B. Litvak of Pachulski Stang Ziehl & Jones LLP said the financing is a critical factor in the company's restructuring hopes and without it the business would likely not be able to continue operating as is and the value of its assets would fall. About Ruby Tuesday Inc. Founded in 1972 in Knoxville, Tennessee, Ruby Tuesday, Inc. -- http://www.rubytuesday.com/-- is dedicated to delighting guests with exceptional casual dining experiences that offer uncompromising quality paired with passionate service every time they visit. From signature handcrafted burgers to the farm-grown goodness of the Endless Garden Bar, Ruby Tuesday is proud of its long-standing history as an American classic and international favorite for nearly 50 years. The Company currently owns, operates and franchises casual dining restaurants in the United States, Guam, and five foreign countries under the Ruby Tuesday brand. On Oct. 7, 2020, Ruby Tuesday, Inc., and 50 affiliates sought Chapter 11 protection. The lead case is In re RTI Holding Company, LLC (Bankr. D. Del. Lead Case No. 20-12456). Ruby Tuesday was estimated to have $100 million to $500 million in assets as of the bankruptcy filing. The Hon. John T. Dorsey is the case judge. Ruby Tuesday is advised by Pachulski Stang Ziehl & Jones LLP as legal counsel, CR3 Partners, LLC, as financial advisor, FocalPoint Securities, LLC, as investment banker, and Hilco Real Estate, LLC, as lease restructuring advisor. Epiq is the claims agent, maintaining the page https://dm.epiq11.com/RubyTuesday SAEXPLORATION HOLDINGS: Executives Accused by SEC of $100M Fraud ---------------------------------------------------------------- Law360 reports that the U.S. Securities and Exchange Commission (SEC) accused bankrupt oilfield services company SAExploration Holdings Inc., its former CEO Jeffrey Hastings and three other former executives on Thursday, Oct. 8, 2020, of overseeing a $100 million accounting fraud, the same day New York federal prosecutors announced criminal fraud charges against Hastings. In a 49-page complaint filed in New York federal court, the SEC accused Houston-based SAE of artificially inflating its revenue by transacting with a purportedly independent organization known as Alaskan Seismic Ventures LLC, a seismic data library company. But the agency says SAE actually created ASV, and that ASV remained under the control of Hastings. About SAExploration Holdings SAExploration Holdings -- http://www.saexploration.com/-- is an international oilfield services company offering a full range of vertically-integrated seismic data acquisition, data processing and interpretation, and logistical support services throughout North America, South America, Asia Pacific, Africa, and the Middle East. In addition to the acquisition of 2D, 3D, time-lapse 4D and multi-component seismic data on land, in transition zones and offshore in depths reaching 3,000 meters, SAE offers a full suite of data processing and interpretation services utilizing its proprietary, patent-protected software, and also provides in-house logistical support services, such as program design, planning and permitting, camp services and infrastructure, surveying, drilling, environmental assessment and reclamation, and community relations. SAE operates crews around the world, performing major projects for its blue-chip customer base, which includes major integrated oil companies, national oil companies and large independent oil and gas exploration companies. With its global headquarters in Houston, Texas, SAE supports its operations through a multi-national presence in the United States, United Kingdom, Canada, Peru, Colombia, Bolivia, Malaysia, and Singapore. SAExploration recorded a net loss of $22.61 million in 2019 compared to a net loss of $59.56 million in 2018. As of March 31, 2020, the Company had $136.03 million in total assets, $149.8 million in total current liabilities, $6.34 million in long-term debt and finance leases, $5.09 million in other long-term liabilities, and a total stockholders' deficit of $25.15 million. Pannell Kerr Forster of Texas, P.C., in Houston, Texas, the Company's auditor since 2014, issued a "going concern" qualification in its report dated April 13, 2020 citing that the Company has experienced recurring losses from operations and has been unable to renegotiate its expiring senior loan facility which raises substantial doubt about its ability to continue as a going concern. SEASPRAY RESORT: Seeks Court Approval to Hire Accountant -------------------------------------------------------- Seaspray Resort, Ltd. seeks authority from the U.S. Bankruptcy Court for the Southern District of Florida to hire M. Alam Chaklader, a certified public accountant at Professional Tax & Insurance. The services Mr. Chaklader will provide are as follows: a. advise the Debtor of its reporting requirements; b. take all necessary actions to protect and preserve the Debtor's estate; c. prepare all tax returns, business financial management reports, and monthly operating reports; d. provide all other necessary accounting services. The accountant will charge $550 per hour for his services. Mr. Chaklader is a "disinterested party" as required by Section 327(a) of the Bankruptcy Code, according to court filings. Mr. Chaklader can be reached at: M. Alam Chaklader, CPA, MBA Professional Tax & Insurance 1489 N Military Trl #214 West Palm Beach, FL 33409 Tel: (561) 444-2016 About Seaspray Resort LTD Seaspray Resort, LTD., a company engaged in casino hotel business, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-17868) on July 20, 2020. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge Mindy A. Mora oversees the case. Townsend, LLC is Debtor's legal counsel. SECURITY FIRST: 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 Security First Corp. About Security First Security First Corp. is a developer of advanced data-centric cyber security solutions. Visit https://securityfirstcorp.com for more information. Security First sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del., Lead Case No. 20-12053) on Aug. 31, 2020. Pankaj Parekh, chief executive officer, signed the petition. At the time of the filing, Debtor had estimated assets of $1 million to $10 million and estimated liabilities of $10 million to $50 million. Judge Brendan Linehan Shannon oversees the cases. William D. Sullivan, Esq., at Sullivan Hazeltime Allinson LLC, serves as Debtor's legal counsel. SERVICE LOGIC: Moody's Assigns B3 CFR, Outlook Stable ----------------------------------------------------- Moody's Investors Service assigned first-time ratings to Service Logic Acquisition, Inc. (Service Logic), including a B3 Corporate Family Rating (CFR) and a B3-PD Probability of Default Rating. Moody's has also assigned a B2 rating to the proposed $520 million first lien senior secured term loan, $150 million first lien senior secured delayed draw term loan, and $100 million revolving credit facility. A $180 million second lien senior secured term loan and $50 million second lien senior secured delayed draw term loan is also to be issued to partially finance the acquisition of Service Logic by Leonard Green & Partners, L.P. The outlook is stable. Service Logic's B3 CFR reflects the company's high leverage and event risk associated with an aggressive acquisition-driven growth strategy. The B2 rating on the first lien credit facilities, which is one notch higher than the B3 CFR, reflects a priority position in the capital structure ahead of a considerable amount of second lien debt, which would be expected to absorb losses ahead of the first lien facilities in a distress scenario. The facility is secured by a first priority security interest in substantially all assets of the borrower and its guarantors, which include the parent holding company and domestic subsidiaries. The assigned ratings are subject to the transaction closing as proposed and receipt and review of final documentation. Assignments: Issuer: Service Logic Acquisition, Inc. Corporate Family Rating, Assigned B3 Probability of Default Rating, Assigned B3-PD Senior Secured 1st lien Term Loan, Assigned B2 (LGD3) Senior Secured 1st lien Delayed Draw Term Loan, Assigned B2 (LGD3) Senior Secured 1st lien Revolving Credit Facility, Assigned B2 (LGD3) Outlook Actions: Issuer: Service Logic Acquisition, Inc. Outlook, Assigned Stable RATINGS RATIONALE The B3 CFR reflects Service Logic's business profile as a one-stop-shop service provider across all OEM HVAC equipment, as well as, the company's predictable revenue stream stemming from the non-discretionary nature of its preventative maintenance services and pull-through capabilities of higher-margin services in situations where emergency repair or equipment replacement is required. The credit profile also benefits from a high customer retention rate and long-standing relationships with customers. The asset-light nature of the business and low capital requirements will help improve free cash flow generation and support de-leveraging. The B3 rating is tempered by Service Logic's high leverage, which Moody's estimates to be 7.2x (debt to LTM EBITDA) pro forma at June 30, 2020. Moody's projects adjusted debt to EBITDA to be 6.8xand 6.2x by the end of 2021 and 2022, respectively. Furthermore, the seasonal nature of the business and exposure to weather dependent demand swings is a constraining factor on the rating. Moody's also evaluates one or more environmental, social, or governance factors as being material to the rating. Governance risks for Service Logic are above average given the company's private equity ownership, which carries the risk of an aggressive financial policy, including debt funded acquisitions. M&A remains a risk, along with integration, given the company's long-term acquisitive growth strategy. Social and Environmental risks are not material to Service Logic. The stable outlook reflects Moody's expectations that Service Logic will grow organically and through acquisitions. The company will lower financial leverage through EBITDA growth, while maintaining good liquidity. Moody's expects Service Logic to maintain good liquidity over the next 12 months with available cash on the balance sheet, positive free cash flow of $44 and $39 million in 2020 and 2021, respectively, and access to a $100 million revolving credit facility, which is expected to be undrawn at close. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's would likely consider a downgrade if revenues and EBITA margins decline, financial leverage is sustained above 7.0x, or if the company experiences a weakening in its liquidity profile. Ratings could also be downgraded if the company accelerates its debt funded acquisition activity or undertakes a significant shareholder return. Moody's could upgrade the rating if the company generates organic revenue growth while increasing EBITA margins and maintaining strong free cash flow. To support a higher rating, Service Logic would need to sustain debt to EBITDA below 6.0x and maintain conservative financial policies along with a good liquidity profile. Headquartered in Charlotte, North Carolina, Service Logic provides aftermarket maintenance, repairs, and replacement services for commercial HVAC equipment, chilled water systems, and building automation and controls systems. The company operates through 76 branches across the United States. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. TAILORED BRANDS: Plan Voters to Obtain Alternative Valuation ------------------------------------------------------------ Law360 reports that a Texas bankruptcy judge on Thursday told Men's Wearhouse parent Tailored Brands that its creditors need to see a dissenting opinion on what the company's worth before they vote on its equity-swap Chapter 11 plan. At a remote hearing, U.S. Bankruptcy Judge David Jones approved Tailored Brands' Chapter 11 disclosure statement, with the condition it include information on a valuation commissioned by the company's unsecured creditors that puts the worth of its assets several hundred million dollars north of Tailored's own estimates. About Tailored Brands Tailored Brands, Inc., (NYSE: TLRD) is an omni-channel specialty retailer of menswear, including suits, formal wear 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. TARGET DRILLING: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Target Drilling, Inc. 1112 Glacier Dr. Smithton, PA 15479 Business Description: Headquartered in Southwestern Pennsylvania, Target Drilling, Inc. -- https://www.targetdrilling.com -- provides contract directional drilling services to drill horizontal boreholes from within underground mines and horizontal, vertical and vertical-to-horizontal boreholes from the surface. Chapter 11 Petition Date: October 9, 2020 Court: United States Bankruptcy Court Western District of Pennsylvania Case No.: 20-22899 Judge: Hon. Thomas P. Agresti Debtor's Counsel: William R. Lauer, Esq. WILLIAM R. LAUER, ESQ. P.O. box 10152 Pittsburgh, PA 15237 Tel: 412-638-6909 Email: wrl@alleghenycapital.com Total Assets as of September 30, 2020: $4,178,464 Total Liabilities as of September 30, 2020: $3,014,346 The petition was signed by Stephen J. Kravits, president/CEO. A copy of the Debtor's list of 20 largest unsecured creditors is available for free at: https://www.pacermonitor.com/view/V6FD45A/Target_Drilling_Inc__pawbke-20-22899__0008.0.pdf?mcid=tGE4TAMA A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/U3IWJDY/Target_Drilling_Inc__pawbke-20-22899__0001.0.pdf?mcid=tGE4TAMA THAKORJI INC: Gets Approval to Hire Resource Tax as Accountant -------------------------------------------------------------- Thakorji, Inc. received approval from the U.S. Bankruptcy Court for the Northern District of Georgia to employ Resource Tax and Accounting, LLC as its accountant. The firm's services will include the preparation of reports to be filed with the bankruptcy court, tax returns and financial documents. The firm will charge $175 per hour for accountants and $100 per hour for bookkeepers and paraprofessionals. Resource Tax represent does not represent interests adverse to the Debtor and its bankruptcy estate in the matters upon which it is to be engaged, according to court filings. The firm can be reached through: Kathy E. Reising, CPA Resource Tax and Accounting, LLC 1551 Jennings Mill Road, Suite 900A Watkinsville, GA 30677 info@resourcepartnerscpa.com Phone: (706)353-2016 Fax: (706)613-8973 About Thakorji Inc. Thakorji, Inc., is a single asset real estate as defined in 11 U.S.C. Section 101(51B). It owns a hotel located at 7910 Mall Ring Road, Lithonia, Ga. Thakorji filed a voluntary Chapter 11 petition (Bankr. N.D. Ga. Case No. 18-70018) on Nov. 30, 2018. At the time of the filing, Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Danowitz Legal, P.C. serves as Debtor's legal counsel. TOWN SPORTS: NY Sports Club Sale Process Approved ------------------------------------------------- Law360 reports that the parent company of New York Sports Club can move forward with its plans to find a buyer for its assets after a Delaware bankruptcy judge said Friday, Oct. 9, 2020, that the proposed timeline for a Chapter 11 sale was acceptable. During a virtual hearing, debtor attorney Joshua M. Altman of Kirkland & Ellis LLP said the company's investment bankers have already begun marketing its assets and have reached out to more than 60 potential bidders in an effort to achieve the highest and best price ahead of an early-November sale hearing. About Town Sports Town Sports International, LLC and its subsidiaries are owners and operators of fitness clubs in the United States, particularly in the Northeast and Mid-Atlantic regions. As of Dec. 31, 2019, the Company operated 186 fitness clubs under various brand names, collectively serving approximately 605,000 members. Town Sports owns and operates brands such as New York Sports Clubs, Boston Sports Clubs, Philadelphia Sports Clubs, Washington Sports Clubs, Lucille Roberts and Total Woman. Town Sports and several of its affiliates filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 20-12168) on Sept. 14, 2020. The petitions were signed by CEO Patrick Walsh. The Debtors were estimated to have $500 million to $1 billion in consolidated assets and consolidated liabilities. The Hon. Christopher S. Sontchi presides over the cases. Young Conaway Stargatt & Taylor, LLP, and Kirkland & Ellis LLP have been tapped as bankruptcy counsel to the Debtors. Houlihan Lokey, Inc. serves as financial advisor and investment banker to the Debtors, and Epiq Corporate Restructuring LLC acts as claims and noticing agent to the Debtors. TOWN SPORTS: U.S. Trustee Appoints Creditors' Committee ------------------------------------------------------- The U.S. Trustee for Region 3 appointed a committee to represent unsecured creditors in the Chapter 11 cases of Town Sports International, LLC and its affiliates. The committee members are: 1. 575 Lex Property Owner, LLC Attn: Darren Xu 315 Park Avenue South New York, New York, 10010 Phone: 212-433-4117 Email: Darren.xu@columbia.reit 2. Philips International Holding Corporation Attn: Seth I. Pilevsky 295 Madison Avenue, 2d Floor New York, New York 10017 Phone: 212-951-3869 Email: spilevsky@pihc.com 3. BDG 99QB, LLC Attn: Brad Blumenfeld 300 Robbins Lane Syosset, New York 11791 Phone: 516-624-1999 Email: bblumenfeld@bdg.net 4. Mykola Kolomiichuk 81 Beacon Hill Dr, Apt B26 Dobbs Ferry, NY 10522 Email: kolomiichuk@gmail.com 5. Nancy Radford 1313 Washington Street #307 Boston, MA 02118 Email: nancyradford@gmail.com Official creditors' committees serve as fiduciaries to the general population of creditors they represent. They may investigate the debtor's business and financial affairs. Committees have the right to employ legal counsel, accountants and financial advisors at a debtor's expense. About Town Sports Town Sports International, LLC and its subsidiaries are owners and operators of fitness clubs in the United States, particularly in the Northeast and Mid-Atlantic regions. As of Dec. 31, 2019, Town Sports operated 186 fitness clubs under various brand names, collectively serving approximately 605,000 members. Town Sports owns and operates brands such as New York Sports Clubs, Boston Sports Clubs, Philadelphia Sports Clubs, Washington Sports Clubs, Lucille Roberts and Total Woman. Town Sports and several of its affiliates filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 20-12168) on Sept. 14, 2020. The petitions were signed by Patrick Walsh, chief executive officer. The Debtors were estimated to have $500 million to $1 billion in consolidated assets and consolidated liabilities. The Hon. Christopher S. Sontchi presides over the cases. The Debtors have tapped Young Conaway Stargatt & Taylor, LLP and Kirkland & Ellis LLP as their bankruptcy counsel, Houlihan Lokey, Inc. as financial advisor and investment banker, and Epiq Corporate Restructuring LLC as claims and noticing agent. TRC FARMS: Kirseys Buying Dover Property for $74.5K --------------------------------------------------- TRC Farms, Inc. field with the U.S. Bankruptcy Court for the Eastern District of North Carolina a notice of its proposed private sale of real estate and improvements identified as approximately 23.81 acres and all improvements constructed thereon located off Highway 55, Dover, Craven County and more particularly described in that certain deed description located at Book 3179, Page 19, Tax Parcel 3-022-18000, Craven County Registry, North Carolina, to Kristopher J. Kirsey and Amanda L. Kirksey for $74,500. Among the assets owned by the Debtor as of the petition date was the Property. By way of a proposed Contract to Purchase, the Debtor asks authority to sell its interest in the Property by private sale to the Buyers for the gross purchase price of $74,500. Per the Contract, the Purchasers will escrow the sum of $1,000 with Mossy Oak Properties. The Debtor asserts that (i) the proposed purchase price is fair; (ii) the Debtor has had no prior personal or business relationship with the prospective Purchaser; (iii) the offer is not subject to a financing contingency; and (iv) a sale of the Property to the Buyers is in the best interest of the estate and all creditors. The Debtor asks an order of the Court declaring that the sale of the Debtor's Property be made free and clear of any and all liens, encumbrances, claims, rights, and other interest, including but not limited to the following: A. Any and all liens and/or security interests in favor of Truist Bank (formerly known Branch Banking and Trust Co.). B. Any and all liens and/or security interests in favor of Harvey Fertilizer and Gas Co. C. Any and all real property-taxes due and owing to any City, County or municipal corporation, and more particularly, to the Craven County Tax Collector. D. Any and all remaining interests, liens, encumbrances, rights and claims asserted against the Property, which relate to or arise as a result of a sale of the Property, or which may be asserted against the buyer of the Property, including, but not limited to, those liens and claims, whether fixed and liquidated or contingent and unliquidated, that have or may be asserted against the Property by the North Carolina Department of Revenue, the Internal Revenue Service, and any and all other taxing and government authorities. If any creditor claiming a lien or interest in the Property does not object within the time allowed, then that creditor will be deemed to have consented to the sale of the property free and clear of its interest. The proceeds of the sale will be subject to (i) estimated quarterly fees arising from the disposition of the sales proceeds, which will be held in reserve pending disbursement of the sale proceeds among secured creditors; and (ii) the terms and conditions of the Offer to Purchase and Contract. The net proceeds will be paid at closing to the holders of valid liens and security interests, in accordance with their respective priority. Objections, if any, must be filed 14 days from the date of the Notice. A copy of the Contract is available at https://tinyurl.com/y2e4nfex from PacerMonitor.com free of charge. About TRC Farms Inc. TRC Farms, Inc., a privately held company in the livestock farming industry, filed a petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. N.C. Case No. 20-00309) on Jan. 23, 2020. In the petition signed by Timmy R. Cox, president, the Debtor disclosed $3,846,275 in assets and $5,412,282 in liabilities. Judge Joseph N. Callaway oversees the case. The Debtor tapped Ayers & Haidt, PA, as its legal counsel, and Carr Riggs & Ingram, LLC as its accountant. URSA PICEANCE: 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 Ursa Piceance Holdings, LLC. About Ursa Piceance Holdings Ursa Piceance Holdings LLC -- http://www.ursaresources.com/-- is engaged in the development and production of oil and gas in the Piceance Basin, principally in rural areas of Western Colorado. Its operations are focused on natural gas and natural gas liquids. Ursa Piceance Holdings LLC and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-12065) on Sept. 2, 2020. The petitions were signed by Jamie Chronister, chief restructuring officer. The Hon. Karen B. Owens oversees the cases. The Debtor was estimated to have assets and liabilities of $100 million to $500 million as of the bankruptcy filing. Sidley Austin LLP has been tapped as general bankruptcy counsel to the Debtors while Young Conaway Stargatt & Taylor LLP has been tapped as Delaware counsel. Conway MacKenzie Management Services LLC serves as interim management services provider to the Debtors. Lazard Freres & Co. LLC is the Debtors' investment banker, and Prime Clerk LLC is the Debtors' claims and noticing agent. UTEX INDUSTRIES: Gets Court Nod to Tap $25 Million DIP Financing ---------------------------------------------------------------- Law360 reports that UTEX, a manufacturer of sealing components for the energy industry, can tap into $25 million in debtor-in-possession financing while it seeks approval of its plan to slash about $700 million in debt, a Texas bankruptcy judge said Friday. UTEX Industries Inc. may use the funds to finance operations during its bankruptcy proceedings and can proceed with a number of other requests in its first-day motions, such as paying employees, trade partners and utility companies, U.S. Bankruptcy Judge David R. Jones said in a hearing. About UTEX Industries UTEX -- https://www.utexind.com/ -- is a privately held designer and manufacturer of engineered seals and related components. Most of UTEX's products have short lifecycles and must be replenished periodically. The company's products primarily serve the completions, production, and drilling segments of the oil and gas industry. UTEX is headquartered in Houston, Texas, with manufacturing and technical sales facilities across Texas, Oklahoma, Singapore, and Malaysia, and distribution centers located in Texas, Pennsylvania, and Colorado. On Oct. 8, 2020, UTEX Industries, Inc., and its affiliates sought Chapter 11 protection (Bannkr. S.D. Tex. Lead Case No. 20-34932). UTEX was estimated to have $100 million to $500 million in assets and $500 million to $1 billion in liabilities as of the filing. The Debtors tapped WEIL, GOTSHAL & MANGES LLP as counsel; HOULIHAN LOKEY CAPITAL, INC. as investment banker; and ALIXPARTNERS, LLP, as financial advisor. OMNI AGENT SOLUTIONS is the claims agent. UTEX INDUSTRIES: Moody's Withdraws Ca CFR on Bankruptcy Filing -------------------------------------------------------------- Moody's Investors Service withdrawn UTEX Industries, Inc.'s (UTEX) ratings, including its Ca Corporate Family Rating (CFR), D-PD Probability of Default Rating (PDR), Ca first lien revolving credit facility rating, Ca first lien term loan rating and C second lien term loan rating. The negative rating outlook was also withdrawn. These actions follow the company's filing of voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas. Ratings Withdrawn: Issuer: UTEX Industries, Inc. Probability of Default Rating, Withdrawn, previously rated D-PD Corporate Family Rating, Withdrawn, previously rated Ca Senior Secured First Lien Revolving Credit Facility, Withdrawn, previously rated Ca (LGD3) Senior Secured First Lien Term Loan, Withdrawn, previously rated Ca (LGD3) Senior Secured Second Lien Term Loan, Withdrawn, previously rated C (LGD5) Outlook Actions: Issuer: UTEX Industries, Inc. Outlook, Changed to Rating Withdrawn from Negative RATINGS RATIONALE The Chapter 11 bankruptcy filing has resulted in the withdrawal of UTEX's ratings. UTEX Industries, Inc., headquartered in Houston, Texas, is a designer, manufacturer and distributor of highly engineered custom-tailored elastomer and thermoplastic spring energized seals, downhole products, and pressure pumping consumable products to the oil & gas extraction industry, particularly the well completions market. UTEX was acquired by affiliates of Riverstone Holdings LLC in April 2013. VALARIS PLC: Hires Alvarez & Marsal as Financial Advisor -------------------------------------------------------- Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire Alvarez & Marsal North America, LLC, as their financial advisor. The services Alvarez & Marsal will render are: (a) assist the Debtors with information and analyses required pursuant to the Debtors' use of cash collateral, and, if applicable, debtor-in-possession financing; (b) assist with the identification and implementation of short-term cash management procedures; (c) assist the Debtors in the preparation of financial-related disclosures required by the Court, including the Debtors' Schedules of Assets and Liabilities, Statements of Financial Affairs and Monthly Operating Reports; (d) analyse of creditor claims by type, entity, and individual claim, including assist with development of databases, as necessary, to track such claims; (e) assist with the identification of executory contracts and leases and performance of evaluations to support the Debtors analysis and decision to assume or reject each contract and lease; (f) attend at meetings and assist in discussions with pre-petition creditors and potential investors, banks, and other secured lenders, any official committee(s) appointed in these chapter 11 cases, the United States Trustee, other parties in interest and professionals hired by same, as requested; (g) assist in the preparation of financial information for distribution to creditors and others, including, but not limited to, cash flow projections and budgets, cash receipts and disbursement analysis, analysis of various asset and liability accounts, and analysis of proposed transactions for which Court approval is sought; (h) advise assist in connection with obtaining approval of key employee compensation and benefit programs; (i) assist the Debtors and their advisors in connection with possible implementation mechanisms of the chapter 11 plan in the UK; (j) assist in the preparation of information and analysis necessary for the confirmation of a plan of reorganization in these chapter 11 cases, including information contained in the disclosure statement; (k) assist in the evaluation and analysis of avoidance actions, including fraudulent conveyances and preferential transfers; (l) provide expert witness testimony on issues directly related to the services provided by A&M, as requested by the Debtors and agreed to by A&M; and (m) render such other general business consulting or such other assist as the Debtors' management or counsel may deem necessary consistent with the role of a financial advisor, and agreed to by A&M, to the extent that it would not be duplicative of services provided by other professionals in this proceeding. Alvarez & Marsal's hourly rates are as follows: Restructuring Managing Director $900-1,150 Director $700-875 Analyst/Associate $400-675 Case Management Managing Director $850-1,000 Director $675-825 Analyst/Consultant $400-625 The firm will be reimbursed for work-related expenses incurred. Alvarez & Marsal does not represent any other entity having an adverse interest in connection with Debtors' Chapter 11 cases pursuant to Bankruptcy Code Section 1103(b). The firm can be reached through: Edgar W. Mosley II Alvarez & Marsal North America, LLC 2100 Ross Avenue, 21st Floor Dallas, TX 75201 Tel: +1 214 438 1000 Fax: +1 214 438 1001 About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VALARIS PLC: Hires Ernst & Young to Provide Tax Services -------------------------------------------------------- Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire Ernst & Young LLP as their tax services provider. EY LLP will perform certain projects covered by this agreement, including: -- assistance with tax issues by answering one-off questions; providing comments on discrete tax calculations; drafting memos describing how specific tax rules work; assisting with general transactional issues; and assisting Client in connection with its dealings with tax authorities (other than representing Client in an examination or an appeal before the IRS or other taxing authority). EY LLP will provide the following tax services in two phases: Phase 1: Examine Valaris plc's equity transactions since Jan. 1, 2020 through the equity transactions occurring on or before Dec. 31, 2020 (the "Owner Shift Analysis") to determine whether Client experienced an ownership change as described in IRC Section 382(g) during the period beginning July 1, 2020 and ending December 31, 2020 (the "Analysis Period"). EY LLP's deliverable to Client for Phase 1 shall include the owner shift computations for each testing date during the Analysis Period. Phase 2: If requested by Client, for each ownership change as defined in Section 382(g) that is identified in Phase 1, EY LLP will compute the Section 382 annual limitation applicable to the ownership change including an analysis to determine the increase to the Section 382 annual limitation from net unrealized built-in gain, if any, under a safe harbor approach described in Notice 2003-65. EY LLP's deliverable to Client for Phase 2 shall include detailed work papers showing the calculation of the Section 382 annual limitation and net unrealized built-in gain analysis for each Section 382 ownership change identified during the Analysis Period. A methodology report describing the facts, assumptions, analysis and conclusions from Phases 1 and 2 is not included in the Services. EY LLP will perform expatriate tax services, including: tax return compliance and consulting services for both employer and Participant in the United Kingdom, Trinidad, Canada, Norway, Malaysia, Indonesia, Turkey and Suriname. EY LLP will perform Federal Tax Return services: review procedures with respect to EGILP's U.S. federal return (Form 1065) for the taxable year ended Dec. 31, 2019. EY LLP will be compensated as follows: (a) ROCTA Engagement Letter EY LLP will bill on an hourly basis based on the rates set forth below: Level Hourly Rate Partner/Principal $775 Ex. Director $730 Senior Manager $655 Manager $525 Senior $390 Staff $230 A 15% premium may be applied on rates for non-US, national, or specialty practice tax professionals. (b) Section 382 Engagement Letter EY LLP will bill on a time and material basis based on agreed Phases: -- The Debtors shall pay EY LLP a fee of $12,000 to $15,000 for the Phase 1 Services. -- If Phase 2 proceeds, the cost will be approximately $25,000 per limitation calculation. (c) PAS Engagement Letter EY LLP shall apply a combination of fixed fee and hourly rate card fee, depending on the type of service provided. The following global tax compliance services will be billed based on the fixed fees: -- Annual Individual Federal tax return (standard complexity) - $1,222 Per return -- State and local income tax return(s) (standard complexity) - $364 Per return -- Request for extension to file, assuming no detailed calculation required - $156 Per extension -- Annual tax reimbursement calculation, as required (standard complexity) - $468 Per calculation -- Entry/Exit orientation meeting/call, limited to one hour duration - $520 Per form -- Hypothetical tax calculation (standard complexity) - $415 Per calculation -- Shadow payroll calculation (for locations of Trinidad and United Kingdom) - $154 Per calculation -- Global Coordination service - 12% global fees Additional expatriate global tax services for Participants will be billed at the following hourly rates: Level Hourly Rate Partner/Principal $628 Senior Manager $564 Manager $426 Senior $356 Staff $164 D. Brock Griffiths, partner of Ernst & Young LLP, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtors and their estates. Ernst & Young can be reached at: D. Brock Griffiths, CPA Ernst & Young LLP 5 Houston Center, 1401 McKinney St Suite 2400 Houston, TX 77010 Phone: +1 713-750-1500 About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VALARIS PLC: Hires Slaughter and May as Special Counsel ------------------------------------------------------- Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire Slaughter and May as its special corporate counsel. Services Slaughter and May will render are: (a) provide legal advice as to how best to achieve the aims of the chapter 11 cases insofar as they relate to English law matters; (b) advise on questions relating to English corporate and insolvency law and the duties applicable to the directors of Valaris plc as a company incorporated in England in the context of the chapter 11 cases; (c) advise on implementation options in relation to the proposed transactions contemplated by the chapter 11 cases; (d) advise on the recognition of the chapter 11 cases in the UK Courts, including any relevant proceedings in the UK Courts; (e) to the extent that English law advice is necessary or desirable, draft, review and agree the full form documents required to implement: (i) the proposed restructuring of the Debtors' existing debt obligations; and (ii) the recapitalization of the Debtors under the terms of the Restructuring Support Agreement and Backstop Agreement; (f) review English law contractual arrangements and contractual arrangements involving UK incorporated companies of the Debtors and considering how the chapter 11 cases may impact them; (g) notwithstanding anything to the contrary in Slaughter and May's Terms and Conditions of Business, advise on UK tax aspects of the structuring and implementation of the chapter 11 cases; (h) advise in respect of the use of certain ancillary proceedings which may be required in order to implement the restructuring in the UK including one or more schemes of arrangement or restructuring plans under the Companies Act 2006 (UK) and potential administration proceedings under Part II of the Insolvency Act 1986 (UK) (including, without limitation, advice provided to the Debtors or their respective English insolvency officeholders during any such proceedings); (i) advise on antitrust issues in relation to the proposed transactions contemplated by the chapter 11 cases; (j) provide additional English law work connected with the Debtors' chapter 11 cases; and (k) advise, through Slaughter and May's Hong Kong office, on matters of Hong Kong law in relation to the chapter 11 cases and the transactions proposed thereby. Slaughter will be paid at these hourly rates: Partners GBP 905 Senior Associate 4 years plus GBP 795 Middle Associate 2-4 years GBP 660 Junior Associate 0-2 years GBP 510 Trainee GBP 285 Slaughter and May has also agreed that a volume discount of 5 percent will be applied on fees billed between GBP 550,000 and GBP 1,100,000 and a volume discount of 7.5 percent will be applied on fees billed in excess of GBP 1,100,000. The aggregate of fees already billed is in an amount such that the volume discount of 7.5 percent will apply to all fees billed as of the date of the Application. Slaughter will also be reimbursed for reasonable out-of-pocket expenses incurred. In accordance with Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, the following is provided in response to the request for additional information: -- Slaughter and May and the Debtors have not agreed to any variations from, or alternatives to, Slaughter and May's billing arrangements because of the chapter 11 cases -- The hourly rates used by Slaughter and May in representing the Debtors are consistent with the rates that Slaughter and May charges regardless of the location of the chapter 11 case. -- Slaughter and May's hourly rates for services rendered in prepetition engagements are as follows: Partners GBP 905 Senior Associate 4 years plus GBP 795 Middle Associate 2-4 years GBP 660 Junior Associate 0-2 years GBP 510 Trainee GBP 285 Slaughter and May has also agreed that a volume discount of 5 percent will be applied on fees billed between GBP 550,000 and GBP 1,100,000 and a volume discount of 7.5 percent will be applied on fees billed in excess of GBP 1,100,000. The aggregate of fees already billed is in an amount such that the volume discount of 7.5 percent will apply to all fees billed as of the date of the Application. Slaughter and the Debtors are in the process of developing and finalizing a budget and staffing plan. Any disclosure of such budget and staffing plan will be retrospective only in conjunction with the filing of fee applications by the Firm. Ian Stuart Johnson, partner of Slaughter and May, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Slaughter can be reached at: Ian Stuart Johnson, Esq. SLAUGHTER AND MAY One Bunhill Row London, EC1Y 8YY United Kingdom Tel: +44 020 7600-1200 Fax: +44 020 7090-5000 About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VALARIS PLC: Seeks to Hire Jackson Walker as Conflicts Counsel -------------------------------------------------------------- Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire Jackson Walker LLP as co-counsel and conflicts counsel. The Debtors require the firm to: a. provide legal advice and services regarding local rules, practices, and procedures, including Fifth Circuit law; b. provide certain services in connection with administration of the chapter 11 cases, including, without limitation, preparing agendas, hearing notices, witness and exhibit lists, and hearing binders of documents and pleadings; c. review and comment on proposed drafts of pleadings to be filed with the Court; d. at the request of the Debtors, appear in Court and at any meeting with the United States Trustee, and any meeting of creditors at any given time on behalf of the Debtors as their local and conflicts bankruptcy co-counsel; e. perform all other services assigned by the Debtors to the Firm as local and conflicts bankruptcy co-counsel; and f. provide legal advice and services on any matter on which K&E may have a conflict or as needed based on specialization. The Firm received a retainer of $860,000 for services performed and to be performed in connection with, and in contemplation of, the filing of this case. The firm's hourly rates are: Partners $445-895 Paraprofessionals 175-$185 Matthew D. Cavenaugh's hourly rate is $750. Matthew Cavenaugh, Esq., a partner at Jackson Walker, disclosed in court filings that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. In response to the request for additional information set forth in Paragraph D.1 of the U.S. Trustee Fee Guidelines, Mr. Cavenaugh made the following disclosures: -- Jackson Walker and Debtors have not agreed to any variations from, or alternatives to, the firm's standard billing arrangements for its engagement. -- The hourly rates used by the firm in representing Debtors are consistent with the rates that it charges other comparable Chapter 11 clients regardless of the location of the cases. -- Mr. Cavenaugh's hourly rate is $750. The rates for other restructuring attorneys at the firm range from $445 to $895 an hour while the paraprofessional rates range from $175 to $185 per hour. The firm represented the Debtors during the weeks immediately before the petition date using those rates. -- The firm has not prepared a budget and staffing plan. Jackson Walker can be reached through: Matthew D. Cavenaugh, Esq. Jackson Walker LLP 1401 McKinney Street, Suite 1900 Houston, TX 77010 Telephone: (713) 752-4200 Facsimile: (713) 752-4221 Email: mcavenaugh@jw.com About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VALARIS PLC: Seeks to Hire Kirkland & Ellis as Legal Counsel ------------------------------------------------------------ Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire Kirkland & Ellis LLP and Kirkland & Ellis International LLP as their attorneys. Kirkland & Ellis will render these legal services: (a) advise Debtors with respect to their powers and duties in the continued management and operation of their businesses and properties; (b) advise and consult on the conduct of Debtors' Chapter 11 cases; (c) attend meetings and negotiate with representatives of creditors and other parties-in-interest; (d) take all necessary actions to protect and preserve Debtors' estates; (e) prepare pleadings; (f) represent Debtors in connection with obtaining authority to continue using cash collateral and post-petition financing; (g) advise Debtors in connection with any potential sale of assets; (h) appear before the court and any appellate courts; (i) advise Debtors regarding tax matters; (j) take any necessary action to negotiate, prepare and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and (k) perform all other necessary legal services for Debtors in connection with the prosecution of the cases. The firms' hourly rates for matters related to the cases range as follows: Partners $1,075 - $1,845 Of Counsel $625 - $1,845 Associates $610 - $1,165 Paraprofessionals $245 - $460 In addition, the firm will charge Debtors for its actual, out-of-pocket expenses. Ross M. Kwasteniet, president of Ross M. Kwasteniet, P.C., a partner of the law firm of Kirkland & Ellis LLP, assures the court that Kirkland is a "disinterested person" within the meaning of section 101(14) of the Bankruptcy Code, as required by section 327(a) of the Bankruptcy Code, and does not hold or represent an interest adverse to the Debtors' estates. Mr. Kwasteniet also made the following disclosures in response to the request for additional information set forth in Paragraph D.1 of the Revised U.S. Trustee Guidelines: -- Kirkland and the Debtors have not agreed to any variations from, or alternatives to, Kirkland's standard billing arrangements for this engagement. -- The hourly rates used by Kirkland in representing the Debtors are consistent with the rates that Kirkland charges other comparable chapter 11 clients, regardless of the location of the chapter 11 case. -- Kirkland's current hourly rates for services rendered on behalf of the Debtors range as follows: Billing Category U.S. Range Partners $1,075-$1,845 Of Counsel $625-$1,845 Associates $610-$1,165 Paraprofessionals $245-$460 -- the Debtors approved Kirkland's budget and staffing plan for the period from August 19, 2020 through Nov. 30, 2020. The firm can be reached through: Ross M. Kwasteniet, Esq. Ross M. Kwasteniet, P.C. Kirkland & Ellis LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VALARIS PLC: Seeks to Hire KPMG LLP as Tax Consultant ----------------------------------------------------- Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire KPMG LLP to provide audit, tax compliance, and tax consulting services. Services KPMG will perform are: Tax Compliance Services (a) Review the following tax returns/forms/work papers related to the Debtors' 2019 federal income tax return(s) as follows: (i) Consolidated Form 1120 for Ensco International Incorporated and Subsidiaries; and (ii) Form 1065 for Ensco Global Investments LP. Tax Consulting Services (a) Provide services related to a unilateral Advance Pricing Agreement ("APA") for fiscal years ending December 31, 2011 through December 31, 2021; (b) Assist the Debtors with representation before the IRS in connection with the Debtors' application for a pre-filing agreement with respect to whether the liquidation of Ensco United LLC would entitle its affiliates to take a deduction for a loss under Internal Revenue Code § 165(g)(3) with respect to the fiscal year ending December 31, 2019; (c) Review and analysis of section 1248 Earnings & Profits analysis as it relates to ENSCO Development Limited ("EDL"); (d) Review and analysis of the outside US tax basis in EDL stock based on inception to-date reorganizations and contributions made to EDL and distributions made by EDL; (e) Review and analysis of US tax consequences related to an internal sale of assets held by EDL; (f) Review and analysis of US and UK tax consequences associated with the internal transfer of EDL stock; (g) Prepare macro tax step-plan describing the tax steps required to consummate the internal transfer of EDL; (h) Provide routine tax advice concerning the federal, state, local, and foreign tax matters related to the preparation of the prior year's federal, state, local, and foreign tax returns; (i) Provide routine tax advice concerning the federal, state, local, and foreign tax matters related to the computation of Debtors' taxable income; (j) Provide routine dealings with federal, state, local or foreign tax authority; (k) Provide tax consulting services related to analyzing the U.S. tax implications to the Debtors associated with business tax provisions enacted as part of the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act"); (l) Review and analysis of any Section 382 issues related to any restructuring alternatives, including a sensitivity analysis to reflect the Section 382 impact of the proposed and/or hypothetical equity transactions; (m) Review and analysis of "net unrealized built-in gains and losses" and Notice 2003-65 as applied to the ownership change, if any, resulting from or in connection with the restructuring; (n) Review and analysis of Debtors' tax attributes including net operating losses, tax basis in assets, and tax basis in stock of subsidiaries as relevant to the restructuring; (o) Review and analysis of cancellation of debt ("COD") income, including the application of Section 108 and consolidated tax return regulations relating to the restructuring of non-intercompany debt and the completed capitalization/settlement of intercompany debt; (p) Review and analysis of the application of the attribute reduction rules under Section 108(b) and Treasury Regulation Section 1.1502-28, including a benefit analysis of Section 108(b)(5) and 1017(b)(3)(D) elections as related to the restructuring; (q) Review and analysis of the tax implications of any internal reorganizations and proposal of restructuring alternatives; (r) Provide cash tax modeling of the tax benefits or tax costs of restructuring alternatives; (s) Review and analysis of potential bad debt and retirement tax losses associated with the restructuring; and (t) Review and analysis of the tax treatment of restructuring related costs. Integrated Audit Services (a) Audit of consolidated balance sheets as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive income (loss), and cash flows for each of the years in the three-year period ended December 31, 2020 and the related notes to the financial statements; (b) Audit of internal control over financial reporting as of December 31, 2020; and (c) Quarterly review procedures for the quarter ended March 31, 2020, June 30, 2020 and Sep. 30, 2020. The firm will charged the following hourly rates for certain specific individuals: Mark Martin Partner/Principal $835 Mark Horowitz Partner/Principal $765 Tracy Gomes Managing Director $635 Joshua McConkey Senior Manager $590 Lillian Sullivan Manager $550 The fees to be charged for other professionals reflect a reduction of approximately 40 percent from KPMG's normal and customary rates and are as follows: Tax Consulting Services Rate Partners and Principals $840 Managing Directors $815 Senior Manager $720 Manager $625 Senior Associate $515 Associate $310 The fees to be charged for other professionals reflect a reduction of approximately 45 percent from KPMG's normal and customary rates and are as follows: Tax Compliance Services Rate Partners and Principals $781 Managing Directors $726 Senior Manager $671 Manager $561 Senior Associate $473 Associate $286 The fees to be charged for other professionals reflect a reduction of approximately 30 percent from KPMG's normal and customary rates and are as follows: Tax Consulting Services Rate Partners and Principals $966 – $1,106 Managing Directors $896 – $1,022 Senior Manager $840 Manager $700 – $784 Senior Associate $602 Associate $364 KPMG and the Debtors have agreed to a fixed fee of $2,200,000 for services relating to the Integrated Audit Services. Approximately $1,670,000 of the Fixed Fee was paid prepetition. The remaining amounts will be billed in the amount of $530,000 on Dec. 31, 2020. For such Out-of-Scope Services, KPMG will be compensated based on hourly rates, not to exceed our standard hourly rates those rates are: Integrated Audit Services Rate Partners and Principals $940 - $1,580 Managing Directors $950 - $1,320 Senior Manager $790 - $1,220 Manager $690 Senior Associate $615 - $860 Associate $390 - $425 KPMG LLP will also be reimbursed for reasonable out-of-pocket expenses incurred. Brad Ringleb, partner of KPMG LLP, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. KPMG LLP can be reached at: Brad Ringleb, CPA KPMG LLP 345 Park Ave. New York City, NY 10154 Phone: (212) 872-2920 About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VALARIS PLC: Seeks to Hire Lazard Freres as Investment Banker ------------------------------------------------------------- Valaris PLC and its debtor-affiliates seek authority from the US Bankruptcy Court for the Southern District of Texas to hire Lazard Freres & Co. LLC as their investment banker. The Debtors require Lazard Freres to: (a) review and analyze the Debtors' businesses, operations, and financial projections; (b) evaluate the Debtors' potential debt capacity in light of its projected cash flows; (c) assist in the determination of a capital structure for the Debtors; (d) assist in the determination of a range of values for the Debtors on a going concern basis; (e) advise the Debtors on tactics and strategies for negotiating with the Stakeholders; (f) render financial advice to the Debtors and participating in meetings or negotiations with the Stakeholders and/or rating agencies or other appropriate parties in connection with any Restructuring; (g) advise the Debtors on the timing, nature, and terms of new securities, other consideration or other inducements to be offered pursuant to any Restructuring; (h) advise and assist the Debtors in evaluate any potential Financing transaction by the Debtors, and, subject to Lazard's agreement so to act and, if requested by Lazard, to execution of appropriate agreements, on behalf of the Debtors, contacting potential sources of capital as the Debtors may designate and assist the Debtors in implementing such Financing; (i) assist the Debtors in preparing documentation within Lazard's area of expertise that is required in connection with any Restructuring; (j) attend and present at meetings of the Board of Directors and any committees of the Board of Directors, as applicable, with respect to matters on which Lazard has been engaged to advise hereunder; (k) provide testimony, as necessary, with respect to matters on which Lazard has been engaged to advise hereunder in any proceeding before the Bankruptcy Court; and (l) provide the Debtors with other financial restructuring advice. The Debtors will compensate Lazard as follows: (a) A monthly fee of $250,000, payable on Sep. 15, 2020 and on the 15th day of each month thereafter until the earlier of the completion of the Restructuring or the termination of Lazard's engagement pursuant to Section 11 of the Engagement Letter. Fifty percent of all Monthly Fees paid in respect of any months following Sep. 2020 shall be credited (without duplication) against any Restructuring Fee or Financing Fee payable. (b) A fee equal to $17,000,000, payable upon the consummation of any Restructuring (the Restructuring Fee); provided, that if a Restructuring is to be completed solely through a Senior Notes Exchange, the Restructuring Fee shall be equal to 40 basis points (0.40 percent) of the aggregate principal amount of Senior Notes exchanged in such Senior Notes Exchange, which fee shall not exceed $17,000,000. (c) A fee equal to $5,000,000, which shall be in addition to the Restructuring Fee provided in Section 2(b) of the Engagement Letter, payable upon the consummation of a Restructuring in the event a Restructuring is consummated either (i) through a Chapter 11 plan of reorganization in which all classes of third-party claims and interests have voted to accept the plan or are deemed to accept the plan, or (ii) through a scheme of arrangement in which all classes of creditors and equityholders have voted in support of the transaction (the Enhanced Restructuring Fee). (d) A fee payable on consummation of any Senior Notes Exchange, other than a Senior Notes Exchange that results in a Restructuring, equal to 40 basis points (0.40 percent) of the aggregate principal amount of Senior Notes exchanged in such Senior Notes Exchange, which fee shall not exceed $17,000,000 (the Exchange Fee); provided, that 100 percent of any Exchange Fee actually paid shall be credited against any Restructuring Fee payable in the event that a Senior Notes Exchange is followed by a Restructuring. (e) For any debtor in possession (DIP) Financing and, if Lazard is requested by the Debtors to provide advice and assistance (which shall include, without limitation, solicitation of potential funding sources to provide funding) to the Debtors with respect to any Financing that is not DIP Financing, a fee or fees (each a Financing Fee) shall be payable as follows: (i) If Lazard acts as the sole financial advisor to the Debtors with respect to a Financing, the Financing Fee shall be equal to the total gross proceeds provided for in any Financing (including all amounts committed but not drawn down under credit lines or other facilities) multiplied by (i) .75 percent with respect to any senior secured debt financing, government or DIP Financing, (ii) 1.5 percent with respect to any junior secured or unsecured debt financing or (iii) 3.0 percent with respect to any equity or equity-linked financing. The Financing Fee shall be payable upon the earlier of signing a commitment letter or definitive documentation for such Financing. Fifty percent (50 percent) of any Financing Fee(s) paid pursuant to Section 2(e)(i) of the Engagement Letter shall be credited (without duplication) against any Restructuring Fee subsequently payable. (ii) If Lazard acts as a financial advisor to the Debtors, together with one or more investment banks, with respect to a Financing, a customary fee shall be payable upon consummation of such Financing, which fee shall be in an amount to be mutually agreed in good faith by the Debtors and Lazard and shall be consistent with the fees paid to investment banks of similar standing acting in similar situations and shall be no less favorable to Lazard than the fees paid to any other investment banks or other financial advisors engaged by the Debtors in such Financing. (f) For the avoidance of any doubt, fees may be payable pursuant to all of clauses (a) through (e) above and more than one fee may be payable pursuant to clauses (d) and (e) above. (g) In addition to any fees that may be payable to Lazard and, regardless of whether any transaction occurs, the Debtors shall promptly reimburse Lazard for all reasonable and documented out-of-pocket expenses incurred by Lazard in the performance of its engagement hereunder (including travel and lodging, data processing and communications charges, courier services and other expenditures) and the reasonable and documented out-of-pocket fees and expenses of counsel, if any, retained by Lazard in the performance of its engagement hereunder; provided, however, that the fees and expenses of outside legal counsel to be reimbursed pursuant to this clause (g) shall not exceed $100,000 without prior written consent of the Debtors, which consent shall not be unreasonably withheld (it being understood, for the avoidance of doubt, that any limitation on reimbursement of expenses in this clause (g) shall not apply to the Indemnification Letter in any capacity). With respect to any monthly expenses in excess of $50,000, Lazard shall first obtain the written approval of the Debtors, which shall not be unreasonably withheld and may be provided via e-mail. (h) The Debtors and Lazard entered into the Indemnification Letter, which agreement remains in full force and effect. As part of the compensation payable to Lazard, the Debtors and Lazard agreed that the Indemnification Letter also applies to our engagement pursuant to the Engagement Letter. (i) All amounts referenced hereunder reflect United States currency and shall be paid promptly in cash after such amounts accrue hereunder. Ari Lefkovits, a managing director at Lazard, attests that his firm is a "disinterested person" within the meaning of section 101(14) of the Bankruptcy Code, as modified by section 1107(b) of the Bankruptcy Code, and as required by section 327(a) of the Bankruptcy Code. Lazard can be reached through: Ari Lefkovits LAZARD FRERES & CO. LLC 30 Rockefeller Plaza New York, NY 10112 Phone: 1-212-632-6000 About Valaris plc Valaris plc (NYSE: VAL) provides offshore drilling services. It is an English limited company with its corporate headquarters located at 110 Cannon St., London. Visit http://www.valaris.com/for more information. On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as their bankruptcy counsel, Lazard as investment banker, and Alvarez & Marsal North America LLC as their restructuring advisor. Stretto is the claims agent, maintaining the page http://cases.stretto.com/Valaris Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer & Feld LLP serve as legal advisors to the consenting noteholders while Houlihan Lokey Inc. serves as their financial advisor. VIRGINIA-HIGHLAND: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------------- Debtor: Virginia-Highland Restaurant, LLC DBA Hudson Grille Sandy Springs 183 12th Street, NE Atlanta, GA 30309 Business Description: The Debtor operates the Hudson Grille restaurant located in Sandy Springs, Georgia. Chapter 11 Petition Date: October 13, 2020 Court: United States Bankruptcy Court Northern District of Georgia Case No.: 20-70718 Debtor's Counsel: J. Robert Williamson, Esq. SCROGGINS & WILLIAMSON, P.C. 4401 Northside Parkway Suite 450 Atlanta, GA 30327 Tel: 404-893-3880 Email: centralstation@swlawfirm.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Jeffrey R. Landau, managing member. A copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/F35O4YA/Virginia-Highland_Restaurant_LLC__ganbke-20-70718__0001.0.pdf?mcid=tGE4TAMA WATERSIDE CONSTRUCTION: Unsecures to Be Paid 100% in 5 Years ------------------------------------------------------------ Debtor Waterside Construction Services, LLC filed with the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, a Plan of Reorganization dated August 20, 2020. Class 5 General Unsecured Creditors will be paid 100 percent of their claims, without interest, in 20 quarterly payments with payments commencing on the start of the calendar quarter immediately following the Effective Date of Confirmation and continuing for a total of twenty-four consecutive quarters. The Debtor projects its disposable income as $196,485 per year. Promissory notes will be issued to each creditor in this class with allowed claims to evidence payments, which promissory notes shall be enforceable in any Court of Competent Jurisdiction. The amount of the pro rata distribution will be considered final and binding 30 days after the filing of the Certificate of Substantial Consummation by the Debtor. Class 6 Equity Security Holders of the Debtor will retain ownership in the Debtor post-confirmation. No distributions will be made to equity until such time as all payments in Class 6 have been made. The Debtor's Plan will be funded by the continued operation of the Debtor. A full-text copy of the plan of reorganization dated August 20, 2020, is available at https://tinyurl.com/yy4r85zh from PacerMonitor at no charge. Attorney for Debtor: BUDDY D. FORD, P.A. Buddy D. Ford, Esquire E-mail: Buddy@tampaesq.com Jonathan A. Semach, Esquire E-mail: Jonathan@tampaesq.com Heather M. Reel, Esquire E-mail: Heather@tampaesq.com 9301 West Hillsborough Avenue Tampa, Florida 33615-3008 Telephone #: (813) 877-4669 Office Email: All@tampaesq.com About Waterside Construction Services Waterside Construction Services, LLC, a general and roofing contractor based in Largo, Florida, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-04260) on June 1, 2020, listing under $1 million for both assets and liabilities. Buddy D. Ford, P.A., led by Buddy D. Ford, Esq., represents the Debtor as counsel. WATERTECH HOLDINGS: Payouts to Depend on Outcome of Liquidation --------------------------------------------------------------- Watertech Holdings, LLC, filed with the U.S. Bankruptcy Court for the District of South Carolina a Combined Plan of Liquidation and Disclosure Statement dated August 21, 2020. The Debtor's ultimate goal is to liquidate its remaining assets to provide the maximum recovery to creditors of this Chapter 11 Estate. The Debtor has created this recovery through the sale of substantially all of its assets pursuant to the Debtor's Motion for Order Authorizing the Sale of Assets of the Debtor Free and Clear of Liens, Claims, Encumbrances, and other Interests filed on March 2, 2020. On August 14, 2020 the Court entered its Order Authorizing the Sale of Assets of the Debtor Free and Clear of Liens, Claims, Encumbrances, and Other Interests, approving the sale of the Debtor’s assets to PureCycle. This asset sale to PureCycle provides sale proceeds in the gross amount of $525,000 for distribution to the holders of Allowed Claims. Class 1 General Unsecured Creditors consists all creditors, who are not members of the Debtor, that are holders of Allowed Claims. The maximum amount of all Class 1 claims that could be allowed is $919,795. However, the Debtor believes that pursuant to its claim analysis, the appropriate amount for all claims in Class 1 is $571,078. The holders of Class 1 claims will be paid a pro rata distribution from the proceeds from the sale of Debtor's assets. Class 2 Membership Loans consists of all creditors with a membership interest in the Debtor who provided loans to the Debtor to support its obligations. The maximum amount of all Class 2 claims is $1,319,169. However, the Debtor believes that pursuant to its claim analysis, the appropriate amount for all claims in Class 2 is $1,241,128. All Class 2 creditors will receive a pro rata distribution of the net proceeds from the sale of Debtor's assets. Class 4 consists of the Equity Interests in the Debtor. The Equity Interests will be terminated to the extent that net proceeds are insufficient to satisfy the claims of Class 1 through Class 3, unless such classes consent to alternative treatment. The Debtor's Plan calls for distribution of the proceeds generated by the Debtor from liquidation of the Debtor's assets. The Debtor believes that because all assets have been liquidated the Plan is not likely to be followed by further liquidation or the need for further reorganization of the Debtor. A full-text copy of the Combined Disclosure Statement and Plan of Liquidation dated August 21, 2020, is available at https://tinyurl.com/y6qs5sc7 from PacerMonitor.com at no charge. Attorneys for the Debtor: McCARTHY, REYNOLDS, & PENN, LLC G. William McCarthy, Jr., I.D.#2762 Daniel J. Reynolds, Jr., I.D.#9232 W. Harrison Penn, I.D.#11164 1517 Laurel Street (29201) P.O. Box 11332 Columbia, SC 29211-1332 Tel: (803) 771-8836 Fax: (803) 765-6960 About Watertech Holdings Watertech Holdings, LLC, is in the disinfecting services business. Watertech Holdings sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Cal. Case No. 20-00662) on Feb. 6, 2020. In the petition signed by Robert Fei, manager, the Debtor disclosed $2,115,000 in assets and $2,187,115 in liabilities. The firm is represented by G. William McCarthy Jr., Esq. at McCarthy, Reynolds & Penn, LLC. WILSONART LLC: Moody's Affirms B2 CFR, Outlook Stable ----------------------------------------------------- Moody's Investors Service affirmed the B2 Corporate Family Rating (CFR), B2-PD Probability of Default Rating and B2 term loan rating of Wilsonart LLC. Concurrently, Moody's assigned a B2 rating to the company's amended revolving credit facility expiring 2023 and withdrew the B2 rating on the company's previous secured revolving credit facility. The outlook remains stable. The affirmation of Wilsonart's B2 CFR and the stable outlook reflect Moody's view of improving, but still strained, credit metrics that will be supported by strong demand fundamentals within the repair and remodel sector. Affirmations: Issuer: Wilsonart LLC Corporate Family Rating at B2 Probability of Default Rating at B2-PD Senior Secured Term Loan due 2023 at B2 (LGD3) Assignments: Senior Secured Revolving Credit Facility due 2023 at B2 (LGD3) Withdrawals: Senior Secured Revolving Credit Facility due 2021 at B2 (LGD3) Outlook Actions: Issuer: Wilsonart LLC Outlook, Remains Stable RATINGS RATIONALE Wilsonart's B2 CFR reflects Moody's expectations that the company will reduce debt to EBITDA to approximately 5.5x and improve interest coverage to 2.5x within the next 12 to 18 months, from 7.3x and 1.8x, respectively, at and for the twelve months ended June 30, 2020. Moody's expectations incorporate full availability on the company's $175 million revolver through the remainder of 2020 and into 2021. The revolver had been almost fully drawn in March out of an overabundance of caution at the start of the coronavirus pandemic and was repaid in full in Q3. Moody's also expects further deleveraging through a partial repayment of its term loan from remaining, unused proceeds on the sale of its Asia segment, which was completed in the fourth quarter of 2019. Moody's forecast also assumes modest top line growth and margin improvement in 2021, reflecting solid fundamentals in the repair and remodel sector which will support demand for the company's products. Moody's expects that Wilsonart will maintain good liquidity over the next 12 to 18 months. Moody's anticipates that the company will generate sufficient cash flow to fund its working capital needs as well as maintenance capital expenditures and mandatory debt amortization. A key governance consideration is Wilsonart's aggressive financial policy, which tends to favor shareholders over creditors. Wilsonart pays a regular dividend to its parent company, Wilsonart International Holdings LLC, which is majority owned by Clayton, Dubilier, and Rice, LLC and Illinois Tool Works Inc. Furthermore, the company has a history of growth through acquisitions and operating with high financial leverage. The stable outlook reflects Moody's expectation of strong demand dynamics within the repair and remodel sector through the end of 2021 and Wilsonart's maintenance of good liquidity. FACTORS THAT COULD LEAD TO AN UPGRADE OR A DOWNGRADE OF THE RATINGS The ratings could be upgrade if Wilsonart operates with debt to EBITDA consistently below 5.0x and EBITA to interest coverage sustained above 3.0x. In considering an upgrade Moody's would also take into account the overall aggressiveness of the company's balance sheet management. The ratings could be downgraded if the company operates with debt to EBITDA consistently over 6.0x and EBITA to interest coverage below 1.5x. Additionally, significant debt-financed acquisitions or shareholder-friendly actions affecting the company's leverage or liquidity profile could adversely impact the ratings. The principal methodology used in these ratings was Manufacturing Methodology published in March 2020. Headquartered in Austin, Texas, Wilsonart is a manufacturer and distributor of decorative engineered surfaces for commercial and residential markets. The company's product offering includes high pressure laminates, solid surfaces, quartz, adhesives, and worktops designed for construction and repair and remodeling. Wilsonart is one of the largest players in its segment in North America and operates in several European markets as well. Revenues for the twelve months ended June 30, 2020 were approximately $1.2 billion. YACHT CLUB: Taps Withum+Brown to Prepare Tax Returns ---------------------------------------------------- Yacht Club Vacation Owners Association, Inc. received approval from the U.S. Bankruptcy Court for the Western District of Missouri to hire Withum+Brown, P.C. to prepare its federal and state tax returns for 2019. The firm will charge the Debtor $750 to $1,000 for the federal tax returns and $500 for each state tax return, plus a standard data security and technology fee. Withum+Brown is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Ray D. Bastin, CPA Withum+Brown, PC 200S. Orange Avenue, Suite 1200 Orlando, FL 32801 Phone: (407) 849 1569 Fax: (407) 849 1119 About Yacht Club Vacation Owners Association Yacht Club Vacation Owners Association, Inc. filed its voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Mo. Case No. 20-41555) on Aug. 28, 2020, listing under $1 million in both assets and liabilities. Daniel D. Doyle, Esq., at Lashly & Baer, P.C., Attorneys at Law, serves as Debtor's legal counsel. YKL LLC: Seeks Approval to Hire Mullin Hoard as Legal Counsel ------------------------------------------------------------- YKL, LLC seeks authority from the U.S. Bankruptcy Court for the Northern District of Texas to hire Mullin Hoard & Brown. L.L.P. as its legal counsel. The firm's services will include the preparation of a Chapter 11 plan and those related to Debtor's Chapter 11 case. Mullin Hoard will be paid at hourly rates as follows: Attorneys $185 to $450 Paralegals $80 to $155 The firm will also be reimbursed for out-of-pocket expenses incurred. David Langston, Esq., disclosed in a court filing that his firm neither represents nor holds any interest adverse to the Debtor and its estate. The firm can be reached through: David R. Langston, Esq. Mullin Hoard & Brown, LLP P.O. Box 2585 Lubbock, TX 79408-2585 Tel: (806) 765-7491 Fax: (806) 765-0553 Email: drl@mhba.com About YKL LLC YKL, LLC filed for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex Case Bo. 20-50172) on Sept. 4, 2020. Everett Allen Lash, managing member, signed the petition. At the time of the filing, Debtor had estimated assets of less than $50,000 and liabilities of between $1 million and $10 million. Mullin Hoard & Brown, LLP serves as Debtor's legal counsel. [*] Bankruptcy Filings in Hawaii Continue to Decline ---------------------------------------------------- Dave Segal of Star Advertiser reports that Hawaii bankruptcies continue to decrease even as individuals and businesses struggle to make ends meet in the slowing economy. The number of filings declined 10.7% in September 2020 to 125 from 140 in the year- earlier period, according to new data from the U.S. Bankruptcy Court, District of Hawaii. The number of cases have now fallen seven of the nine months this year. Year to date through September, bankruptcy filings were down 8.1% to 1,149 from 1,250 during the same period in 2019. "Though bankruptcies rise during economic recessions, it is different this time," said Eugene Tian, chief economist for the state Department of Business, Economic Development and Tourism. "I think the decrease is mainly because of the federal assistance programs. We still have the rental and the mortgage assistance programs in place. That is the most important part." There has been renewed talk that Congress still may be able to come to an agreement on fiscal stimulus that could provide additional weekly payment besides the regular unemployment benefits. One-time stimulus checks also are under discussion. Tian said that possibility of additional federal aid may be another reason people are holding off filing for bankruptcy. "I think people are expecting there will be more assistance coming," he said. "That may be one of the major reasons bankruptcy filings are low. During the last recession, 3,101 bankruptcy cases were filed in 2009 and 3,954 cases were filed in 2010. As of this week, a total of over $10 billion in federal money was allocated to Hawaii. This greatly helped the people and businesses in Hawaii during this difficult time." In July 2020, Chapter 7 liquidation filings — the most common type of bankruptcy — edged up by just one to 96 from 95 in the year-earlier period. Chapter 13 filings, which allow individuals with regular sources of income to set up plans to make installment payments to creditors over three to five years, dropped 37.8% to 28 from 45. There was one Chapter 11 reorganization filing last month compared with none in the year-earlier period. The Chapter 11 filing was by R&H Machinery Inc. of Kapolei. Bankruptcies fell in three of the four major counties. Honolulu County filings fell to 91 from 101, Hawaii County filings dropped to seven from 11 and Kauai County filings ticked down to four from five. Maui County filings remained at 23. [*] Bankruptcy Filings in U.S. Show Surprising Decrease ------------------------------------------------------- Peter Coy of Bloomberg News reports that when the Covid-19 recession hit it seemed certain that a wave of bankruptcy filings would follow, swamping the court system and possibly even leading to a systemic collapse. Oddly, though, there hasn't been any wave. By one key measure, bankruptcy filings have actually declined from last year. While Chapter 11 filings overall are up 21% from last year, that number has been swelled by a sharp increase in filings by companies that have multiple affiliates, each of which files separately, says Ed Flynn, a consultant to the American Bankruptcy Institute. Counting just parent companies and those with no affiliates, Chapter 11 filings are 28% lower for March 1 through Sept. 30, 2020 compared with the same period a year earlier, according to Flynn’s calculations. "It's kind of amazing," he says. For the week ended Oct. 4, 2020, total filings under all bankruptcy chapters (7, 9, 11, 12, 13, and 15) were down 32% from the same week a year earlier, says Flynn. This is mostly good news—a sign that companies and households aren't as stressed at this stage as many economists and bankers expected them to be. "This really seemed like it had the potential to be a huge collapse," says David Mericle, chief U.S. economist of Goldman, Sachs & Co. "For most people, and I would include myself, this has come as a pleasant surprise." On other hand, bankruptcy filings aren't a perfect measure of hardship. Many companies are barely hanging on and could be forced to file soon if a new round of coronavirus relief isn't forthcoming. Also, many small businesses and low- to middle-income households go bust without ever showing up in federal bankruptcy court. Goldman Sachs economists have been tracking the recession and recovery since April. Mericle summarized their latest findings in an Oct. 7, 2020 note to clients titled "The Surprisingly Limited Scarring Effects from the Pandemic Recession." In addition to citing favorable bankruptcy data, the note says that many businesses that closed have since reopened, and that there has been a surge in business formation, to a rate about 50% higher than the average of the past decade. On the household side, Mericle's note says, employment has rebounded, and about half of those who remain jobless say they're on temporary layoff—which means they could be called back to work soon if conditions continue to improve. What's more, about 60% of the remaining unemployment is in industries that are virus-sensitive and "will likely benefit from a surge in demand once a vaccine becomes widely available, which we expect in the first half of 2021," the note says. Goldman Sachs economists challenge some bankruptcy statistics that appear threatening. Bloomberg's Corporate Bankruptcy Index, which covers companies with at least $50 million in liabilities, has more than doubled to around 223 from under 100 in February, but Mericle writes that Goldman Sachs credit analysts have concluded that many of the companies that filed, including some retailers and energy producers, were already weak, "not otherwise healthy businesses needlessly sunk by an unprecedented shock." The economists also dispute a recent study by the Federal Reserve Bank of San Francisco that says the insolvency risk for nonfinancial U.S. companies is "comparable to the peak of the 2008 global financial crisis," and "Chapter 11 bankruptcy filings are running at their fastest pace since 2013." That increase is mainly because of a change in the bankruptcy code that went into effect earlier this year making Chapter 11 more attractive, the Goldman note says, and has been offset by a decline in other types of bankruptcy filings. (This explanation is different from, but compatible with, the explanation of Ed Flynn of the American Bankruptcy Institute.) Mericle attributes the lower-than-expected number of bankruptcy filings to three things: federal relief, including the $500 billion-plus Paycheck Protection Program; a sharp rebound in business activity; and forbearance by landlords, lenders, and suppliers. You might expect small companies to fare worse because they have fewer options for raising money if they get in trouble. Aside from the cash they generate, they rely mostly on bank loans, in contrast to large companies that can issue shares, bonds, commercial paper, and so on. Yet the National Federation for Independent Business reported on Oct. 1, 2020 that business for its members is so strong that finding qualified workers is one of their main problems. The federation's Small Business Optimism Index rose above its 46-year average in August. That's not to say all is well. The NFIB announced on Oct. 7, 2020 that 86% of its members that received Paycheck Protection Program loans have spent all the money and 49% "anticipate needing additional financial support over the next 12 months." "Financial distress is going to have a long tail before it shows up in bankruptcy court," says Robert Lawless, a professor at the University of Illinois College of Law and administrator of the blog Credit Slips. "We should be happy that there aren’t more filings, but I don't think we should extrapolate that out to not worrying about future bankruptcies," agrees Ed Tillinghast, a bankruptcy lawyer who is a partner at Sheppard Mullin, an international law firm. "The longer this goes on, the more difficult it's going to be for businesses to manage." [*] G&S: Bankrupt Retailers Seek Extraordinary Relief in Covid -------------------------------------------------------------- Yara Kass-Gergi, Vanessa Moody and John White III of Goulston & Storrs PC wrote an article on JDSupra titled "Bankrupt Retailers Seek Extraordinary Relief in Time of COVID." The COVID-19 pandemic has forced big-name brands to pursue unique strategies to secure fiscal relief. Even prior to the pandemic’s outbreak, certain retailers experienced financial difficulties and filed for Chapter 11 bankruptcy. The pandemic only exacerbated retailers' difficulties by effectively shuttering stores nationwide, thus halting certain retailers' "going out of business" sales. The suspension of such sales has led to the rise of requests of the bankruptcy court for extraordinary relief—namely, the authorization to suspend rent payments. To be clear, while such requests are far from the norm, they are not entirely unsupported by bankruptcy law. At the request of bankrupt retailers, courts are invoking little-known and seldom-utilized provisions of the Bankruptcy Code to grant these debtor-retailers relief, namely sections 305 and 365(d)(3). Section 305 of the Bankruptcy Code allows the court to dismiss a case or suspend all proceedings in certain situations – if the interests of creditors and the debtor would be better served by such an action. Section 365(d)(3) of the Bankruptcy Code allows a court to extend, for cause, the time for performance of any obligations under unexpired leases that arise within 60 days following the date of the order for relief (which usually means the date on which the case is filed); however, the time for performance is normally not allowed beyond such a 60-day period. In evaluating a request under section 305, the court considers a wide range of factors, such as the economy and efficiency of having the bankruptcy court handle the matter and the possible prejudice to the various parties, but the weight given to each factor depends on the facts of the individual case. One of the first retailers to ask the court for a suspension of proceedings pursuant to section 305 was the long-time sporting goods store, Modell's. Modell's requested that the bankruptcy court defer its rent obligations for 60 days following its bankruptcy filing. In effect, the retailer requested the bankruptcy court press 'pause' on its bankruptcy proceeding while the government-mandated store closures were in effect. After deliberation and a two-hour hearing, the bankruptcy judge decided to allow Modell's to suspend its bankruptcy case—including rent payments—for 30 days, reasoning that without the ability to conduct its "going-out-of-business" sales, Modell's ability to conduct productive liquidation sales was significantly impaired. Later, the Modell's bankruptcy court granted a second 30-day suspension of the case, citing the continued consequences of the COVID-19 pandemic as warranting such relief. In fact, the judge granted this second extension over the objections of 44 landlords, which cumulatively held the leases for around half of the retailer's 134 stores. The bankruptcy judge however, did acknowledge the plight of these landlords in these novel times by verbally cautioning Modell's to consider allocating funds from its sales to the landlords for rent payable during the suspension period when the stores finally reopened. The bankruptcy judge's decision to suspend Modell's bankruptcy proceeding and its rent obligations resulted in a domino effect of retailers thinking "outside-the-box" and requesting relief through unorthodox requests. Without requesting that their bankruptcy cases actually be suspended, other retailers have achieved relief from lease obligations through section 365(d)(3). Following Modell's success, retailers Pier 1 and Chino's (J. Crew and Madewell) both requested the deferral of the payment of rent for 60 days after having filed for bankruptcy. Both courts granted this requested relief by relying upon the precedent set by Modell's case. The granting of such relief, especially in the case of Chino's, should underscore the economic significance of these bankruptcy court's decisions, as the clothing retailer's achieved rent relief amounts to 23 million monthly. Pier 1 successfully pursued additional relief, as the bankruptcy judge overseeing its case both suspended rent payments, pursuant to section 365(d)(3), and ordered a 45-day adjournment for all motions for relief from the automatic stay, further keeping creditors at bay. Of note is the fact that the 60-day rent deferral in the Pier 1 case was approved and extended outside of the initial 60 days of the case, which timing is not supported by the Bankruptcy Code. The bankruptcy judges in both the Chino's and Pier 1 cases cited the same reason in granting such relief— that the pandemic and its direct economic impact on businesses justifies debtors receiving relief to which they normally would not be entitled. It bears noting, however, that the latitude extended by the bankruptcy courts during this pandemic has its limits, as demonstrated in the case of the Regus Corporation. In Regus, multiple subsidiaries of the corporation, a common workspace provider, filed for bankruptcy protection. These subsidiaries, which are single-purpose entities, all hold commercial leases for worksharing locations. Another subsidiary of Regus owns all furniture, fixtures, and equipment found in these workspaces. The bankrupt subsidiaries filed an emergency motion and requested the bankruptcy court to extend bankruptcy protections (namely, the automatic stay) to these furniture, fixtures, and equipment—property of the non-bankrupt subsidiary—to the extent that landlords to leases with non-debtor tenant entities would have been required to provide prior notice of any lease termination to the Regus bankruptcy estate. The bankruptcy judge summarily denied this request on an interim basis, citing the fact that landlords had little time to object to the proposed relief, and that there was no showing the debtor companies were entitled to such relief. Regus later withdrew its motion. Despite the apparent limitations imposed by the Regus court, COVID-19 and the government-mandated store closures have highlighted a new trend of bankruptcy courts to consider unorthodox strategies and grant extraordinary and unprecedented relief. It will be important to monitor this new trend to try to better predict the direction of future retail bankruptcy cases in these extraordinary times. It remains to be seen if the pendulum will swing back to normalcy as more and more retail stores re-open during this pandemic. ********* 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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