/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/201016.mbx T R O U B L E D C O M P A N Y R E P O R T E R Friday, October 16, 2020, Vol. 24, No. 289 Headlines 3MB LLC: Seeks Court Approval to Employ Special Counsel ALCAMI CORP: S&P Upgrades ICR to 'CCC+' on Improved Liquidity ALCHEMY INTERNATIONAL: S&P Lowers ICR to 'B-'; Outlook Stable ALPHATEC HOLDINGS: Expects Q3 Revenue Growth of 41% to 43% ALPHATEC HOLDINGS: Offering $85 Million Worth of Common Stock ALTRA MORTGAGE: Hires Michael Jay Berger as Counsel AMC THEATERS: Mulls Bankruptcy Filing as Moviegoers Stay Home AMERICAN TIMBER: Seeks Approval to Retain Operations Manager AMERICAN TIMBER: Seeks to Hire Roop Law Office as Legal Counsel AMINE LLC: Seeks to Hire Barry A. Friedman as Legal Counsel ANCHOR GLASS: S&P Cuts ICR to 'SD' on Distressed Debt Exchange ARCHDIOCESE OF NEW ORLEANS: TMI Trust Removed as Committee Member ASCEND LEARNING: S&P Lowers First-Lien Debt Rating to 'B-' ASPIRA OF FLORIDA: Files for Chapter 7 Liquidation Due to Pandemic BALDUCCI'S & KINGS FOOD MARKETS: Albertson Plans to Buy 27 Stores BEAMABLE INC: Continues to Operate Despite Bankruptcy Filing BENJA INCORPORATED: Voluntary Chapter 11 Case Summary BMZ LLC: Seeks to Hire Steven M. Fishman as Bankruptcy Counsel BOOTS SMITH: Seeks Approval to Hire Horne LLP as Accountant BOY SCOUTS: Victims Ask Court for Role in Chapter 11 Case CAH ACQUISITION: Selling All Assets to Lauderdale for $8 Million CARDINAL CARE: Seeks to Hire David A. Boone as Legal Counsel CBAC PROPERTIES: May Use Rio Bank's Cash Collateral Thru Oct. 21 CHARTER SCHOOL OF EDUCATIONAL EXCELLENCE: S&P Rates Rev Bonds 'BB' CHESAPEAKE ENERGY: Gets $85M Chapter 11 Bid for Oklahoma Wells CHIEF OILFIELD: Taps Patterson Earnhart as Litigation Counsel CHOBANI LLC: Moody's Rates New Secured Bank Debt 'B1' CLEVELAND BIOLABS: Signs Consulting Contract with CSO CNT HOLDINGS: S&P Assigns 'B' ICR; Outlook Negative COMCAR INDUSTRIES: Joey Martin Buying Low Value Assets for $3K COMCAR INDUSTRIES: K&K Truck Buying Low Value Assets for $7K COMCAR INDUSTRIES: Southeast Buying 4 Dry Cement Tankers for $13.8K COMCAR INDUSTRIES: TAC Auction Buying Reefer Trailer for $6K CONNECTING CULTURES: To File Exit Plan within Statutory Timeframe CONTURA ENERGY: Incurs $238.3 Million Net Loss in Second Quarter CONTURA ENERGY: Issues Statement on MG Capital Letter COVIA HOLDINGS: Committee Says Disclosures Inadequate COVIA HOLDINGS: Gets Court Nod to Seek Reorganization Plan Votes COVIA HOLDINGS: Unsecureds Will Recover 9% to 12% of Claims CRACKED EGG: Broke Covid Rules, Now in Chapter 11 CYCLE HOUSE: Case Summary & 20 Largest Unsecured Creditors DEAN FOODS: Food Lion Tells Court It Needs More DFA Co-Op Docs DEERLICK TRUCKING: Seeks to Hire Quinn Law Firm as Attorney DEWIT DAIRY: Seeks to Hire Angstman Johnson as Attorney DIESEL REALTY: Taps Parker & Associates as Bankruptcy Counsel DMM HOLDINGS: Taps Parker & Associates as Bankruptcy Counsel DN ENTERPRISES: Selling 2 Omaha Investment Properties for $96K DPW HOLDINGS: NYSE Accepts Plan to Regain Compliance EDWARD DAWSON: Juarez Buying Warden Property for $3K Cash EFS COGEN: S&P Rates New Term Loan, Revolving Credit Facility 'BB-' EMERGENT CAPITAL: Case Summary & 2 Unsecured Creditors EMPIRE GENERATING: Lenders' Appeal from Plan Ruling Underway EPICOR HOLDINGS: S&P Affirms 'B-' ICR on Pending Acquisition EPR PROPERTIES: S&P Lowers ICR to 'BB+' on Tenant Headwinds ESPORTS USA: Case Summary & 15 Unsecured Creditors FARBER BALLET: Seeks Approval to Hire Accountant FERRELLGAS PARTNERS: Incurs $83 Million Net Loss in Fiscal 2020 FIELDWOOD ENERGY: Committee Taps Cole Schotz as Co-Counsel FIELDWOOD ENERGY: Committee Taps Stroock & Stroock as Counsel FILTRATION GROUP: S&P Rates New $400MM Incremental Term Loan 'B' FOOT AND ANKLE: Seeks to Hire Bonnie Bell as Legal Counsel FORD STEEL: U.S. Trustee Unable to Appoint Committee FREEDOM MORTGAGE: S&P Rates New Senior Unsecured Notes 'B-' FULTON PROPERTIES: Case Summary & 6 Unsecured Creditors G WEALTH 88: Operator Files for Chapter 11 Bankruptcy Protection GB HOLDINGS: U.S. Trustee Unable to Appoint Committee GENERAL MACHINE: Seeks to Hire Daniel L. Freeland as Legal Counsel GEORGIA DIRECT: Dills Buying Richmond Property for $81.5K GIGA WATT: Trustee Selling Moses Lake Equipment for $42K GNC HOLDINGS: Court Approves Chapter 11 Sale to Harbin Pharma GNC HOLDINGS: Court Confirms Plan After $780 Mil. Stores Sale GNC HOLDINGS: Expects Sale Closing Prior to Sale Hearing GROW CAPITAL: Incurs $2.35 Million Net Loss in Fiscal 2020 HALS REALTY: Trustee Selling 401-411 Parcel to Rhinebeck for $21M HENNEPIN AVENUE: Butcher & the Boar Owner Liquidating in Chapter 7 HERITAGE HOTEL: Taps Walters Levine as Special Litigation Counsel HERITAGE RAIL: Seeks Approval to Hire Moglia Advisors, Appoint CRO IRONCLAD ENCRYPTION: Seeks to Hire Pendergraft & Simon as Counsel JACOBSON HOTELS: Taps J. Beard as Real Estate Broker JAGGED PEAK: TradeGlobal Still in Business After $9.4M Sale JIM'S DISPOSAL: Nov. 12 Auction of Assets Set JRL FITNESS: Seeks to Hire Latham Luna as Legal Counsel K & K TECHNOLOGY: Taps James Shepherd as Bankruptcy Counsel K&W CAFETERIAS: Hires Leonard Ryden Burr as Real Estate Broker K.G. IM LLC: Secured Lenders Sign Deal to Purchase Assets KADMON HOLDINGS: To Transfer U.S. Stock Exchange Listing to Nasdaq KHAN REAL ESTATE: HAB Buying Billings Property for $1.64 Million KIDS FIRST: Seeks to Hire G.L. Milller as Accountant KLX ENERGY: Moody's Lowers CFR to Caa1, Outlook Stable LILIS ENERGY: Court OKs Solicitation of Bankruptcy Plan Votes LILIS ENERGY: Mineral Lienholders Object to Disclosure Statement LILIS ENERGY: Plaintiffs Say Disclosures Misleading LIQUIDNET HOLDINGS: Moody's Puts Ba3 CFR on Rating Review LIQUIDNET HOLDINGS: S&P Places 'BB-' ICR on Watch Positive LOS ANGELES SCHOOL: Seeks to Hire Kogan Law as Bankruptcy Counsel LUCKY TEETH: Seeks to Hire Edwards & Associates as Accountant MAD RIVER: U.S. Trustee Appoints Creditors' Committee MALLINCKRODT PLC: S&P Lowers ICR to 'D' on Chapter 11 Filing MALLINCKRODT PLC: Top Creditors Oppose Its Chapter 11 Strategy MANZANA CAPITAL: Hires Strom Commercial as Real Estate Agent MARTIN DEVELOPMENT: Seeks to Hire Parker & Associates as Counsel MRO HOLDINGS: S&P Affirms 'B' ICR; Outlook Negative NEFFGEN FAMILY: Hires Terry to Liquidate Store/Warehouses Inventory NEPHROS INC: Lends $1.3 Million to Subsidiary for Clinical Trial NEW HOME CO: S&P Rates New $250MM Senior Unsecured Notes 'B-' NICE SERVICES: Taps Steven M. Fishman as Bankruptcy Counsel NSHE CA BULLS: Taps Dalton Real Estate as Real Estate Broker OLDSMAR JJ: Seeks to Hire Steven M. Fishman as Bankruptcy Counsel OLIYAN TACOS: Hires DeMarco-Mitchell as General Counsel ONPOINT OIL: Case Summary & 20 Largest Unsecured Creditors PARKING MANAGEMENT: To Pay At Least $1.45M to Settle JBG Smith Suit PHILADELPHIA PERFORMING ARTS: S&P Raises Revenue Bond Rating to BB+ PHIO PHARMACEUTICALS: Stockholders Pass All Proposals at Meeting PIVOTAL HOLDINGS: S&P Raises ICR to 'B+'; Rating Withdrawn PLANTERS EXCHANGE: Seeks Approval to Hire Accountant PRIMO FOODS: Seeks to Hire Joyce W. Lindauer as Legal Counsel PROVIDENT GROUP: S&P Cuts Rating on 2015A-B Revenue Bonds to 'B' REAGOR-DYKES MOTORS: Court Narrows Claims in Suit vs FirstCapital RGN-AUSTIN XV: Voluntary Chapter 11 Case Summary ROBBIN'S NEST: Seeks Approval to Hire Accountant ROBERT MICHELENA: Homestead Right on Property is 66.6%, Court Says RUSSEL METALS: Moody's Rates Proposed Unsecured Notes B1 SABER INTERMEDIATE: S&P Assigns 'B-' ICR; Outlook Stable SEA OAKS GOLF: Still Searching for Buyer SHAKY TOWN: Case Summary & 20 Largest Unsecured Creditors SHIFT4 PAYMENTS: S&P Rates New $450MM Senior Unsecured Notes 'B' SIRINE LLC: Seeks to Hire Barry A. Friedman as Legal Counsel SMG US 2: Moody's Lowers CFR to Caa1, Outlook Negative SOVOS BRANDS: S&P Upgrades ICR to 'B'; Outlook Stable SSA RETAIL: Seeks Approval to Hire MD Universal as Accountant STEIN MART: Committee Seeks to Hire Frost Brown as Legal Counsel STEIN MART: Committee Taps FTI Consulting as Financial Advisor STEIN MART: Committee Taps Gray Robinson as Local Counsel STEM HOLDINGS: Inks Definitive Agreement to Acquire Driven STONEWOOD HOMES: Case Summary & 6 Unsecured Creditors TAILORED BRANDS: Porter, Gibson Update List of Term Lenders TARGA RESOURCES: S&P Affirms 'BB' ICR; Outlook Stable TERRANCE J. MCCLINCH: Limited Discovery Authorized in Palsa Suit TESLA INC: S&P Raises ICR to 'BB-' on Strong Competitive Position TJ HOLDINGS: Seeks to Hire Crabtree CPA as Accountant TMK HAWK: S&P Raises ICR to 'CCC'; Outlook Negative TOWNHOUSE HOTEL: Seeks Approval to Hire Scott Alan Orth as Attorney TRANSMONTAIGNE PARTNERS: Fitch Affirms 'BB' IDR, Outlook Stable TRAVERSE MIDSTREAM: S&P Affirms 'B' ICR on Term Loan Amendment TRILOGY INTERNATIONAL: Fitch Affirms CCC+ Issuer Default Rating TWIN RIVER: S&P Affirms 'B+' ICR; Ratings Withdrawn UNITED NATURAL: Moody's Upgrades CFR to B1, Outlook Stable VIDEO RIVER: Accounting Errors Found in Financial Statements WAVE COMPUTING: Sintegra Resigns From Creditors' Committee WEBER-STEPHEN PRODUCTS: S&P Assigns 'B' ICR; Outlook Stable WISCONSIN APPLE: Case Summary & 20 Largest Unsecured Creditors YMCA OF MILWAUKEE: Closes Downtown Branch Permanently YOGAWORKS INC: Case Summary & 20 Largest Unsecured Creditors YOGAWORKS INC: Files for Chapter 11 to Sell to Serene [*] Eagle Ford Shale's Biggest Bankruptcy Filings in 2020 [*] Notable Bankruptcy Filings in Bay Area Since the Pandemic ********* 3MB LLC: Seeks Court Approval to Employ Special Counsel ------------------------------------------------------- 3MB LLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of California to hire Nathan Hodges, Esq., an attorney at Hodges Law Group, as its special counsel. The Debtor needs legal assistance in connection with the lawsuits filed by the City of Bakersfield, which stemmed from a settlement agreement involving the Debtor's real property. Mr. Hodges will be paid based on the firm's normal and usual hourly billing rates, plus reimbursements for cost incurred by the firm. Mr. Hodges is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, according to court filings. Mr. Hodges holds office at: Nathan M. Hodges, Esq. Hodges Law Group 1925 G Street Bakersfield, CA 93301 Telephone: (530) 219-2591 About 3MB LLC 3MB LLC owns a mixed-used shopping center, commonly referred to as the Village at Towne Center. The Shopping Center comprises of four buildings, two of which include second story office space. The Shopping Mall has a current value of $12 million. 3MB first sought bankruptcy protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Calif. Case No. 18-14663) on Nov. 19, 2018. The Debtor again sought Chapter 11 protection (Bankr. E.D. Cal. Case No. 20-12642) on Aug. 11, 2020. Robert Bell, Esq., signed the petition. At the time of the filing, Debtor had total assets of $12,276,441 and liabilities of $10,249,027. Judge Jennifer E. Niemann oversees the case. The Law Office of Leonard K. Welsh is Debtor's legal counsel. ALCAMI CORP: S&P Upgrades ICR to 'CCC+' on Improved Liquidity ------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Alcami Corp, a pharmaceutical contract development, testing, and manufacturing organization (CDMO), to 'CCC+' from 'CCC' and its issue-level rating on its first-lien term loan and revolver to 'CCC+' from 'CCC'. The second-lien term loan is unrated. S&P's '3' recovery rating on the senior secured debt remains unchanged. The stable outlook reflects S&P's belief that the company's current cash balances will be adequate to fund its projected negative free cash flows over the next 12 months while it scales the operations at its TriPharm sterile manufacturing facility and improves its EBITDA and cash flow. The upgrade reflects Alcami Corp.'s significantly improved liquidity following the sale of its API facility. S&P said, "However, our ratings also reflect the new management team's near-term challenge to restore the company's profitability and free cash flow. If management is unable to restore Alcami's profitability and free cash flow, we may deem its current capital structure as unsustainable." The Germantown, Wis. API facility accounted for over one-third of Alcami's forecast revenue and was an important component of its end-to-end development and manufacturing capability. The facility was also the impetus for the majority of the company's revenue growth in the first half of 2020. Despite this loss, the sale of the facility will enable Alcami's new management team to focus more on its core offerings and substantially lower its working capital needs while generating greater profitability as it expands its laboratory business and begins manufacturing at the TriPharm facility. The company will begin manufacturing on two of the four lines at its new TriPharm facility this month and aims to launch the other two, larger lines in spring 2021. S&P said, "The stable outlook reflects our belief that Alcami's current cash balances will be adequate to sustain its operations over the near term given its expectation for negative free cash flow over the next 12 months as it scales its operations at its TriPharm sterile manufacturing facility." Given its substantial cash balance following the sale of the API facility, a downgrade is unlikely over the next 12 months. However, S&P could lower its rating on Alcami if it underperforms its expectations for improvement and experiences persistent cash flow deficits that lead it to believe it is at risk of undertaking a distressed exchange or a restructuring in the next 12 months. This could occur if there are additional delays with the TriPharm facility or the company's operating performance deteriorates further, reducing S&P's confidence in the company's ability to meet its debt obligations and comply with its springing financial covenant. S&P could raise its rating on Alcami to 'B-' if it improves its EBITDA margins and generates sustainably positive free cash flow that--along with debt reduction--leads to a significant decline in its leverage. ALCHEMY INTERNATIONAL: S&P Lowers ICR to 'B-'; Outlook Stable ------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based metals powder producer Alchemy International Holdings LLC (Kymera) to 'B-' from 'B' to reflect its expectation for weaker credit measures. At the same time, S&P is lowering its issue-level rating on the company's $420 million first-lien term loan due 2025 ($413 million outstanding) to 'B-' from 'B'. The '3' recovery rating remains unchanged. "The stable outlook reflects our expectation that Kymera's debt leverage will remain above 6x over the next 12 months. Nevertheless, we anticipate that the company will maintain adequate levels of liquidity despite our anticipation for a prolonged recovery in its end markets," S&P said. S&P forecasts that Kymera's credit measures will remain weaker than the rating agency previously anticipated over the next 12-24 months. Because of the decline in its end-market demand and the pressure on its margins, the company's interest coverage is currently below 2x and S&P expects the company's leverage to remain above 8x through the end of 2021. This is in contrast to S&P's previous expectations for a strong performance this year following Kymera's $250 million acquisition of Reading Alloys, which closed in March 2020. S&P believed the acquisition of Reading would provide the company with high-value-add products due, in part, to its access to the aerospace end markets. However, the aerospace industry has been among the hardest hit by the pandemic, which has suppressed Kymera's volumes and delayed the prospects for an expansion in its EBITDA margin to more than 15% well into 2021. Kymera's volumes already faced pressure from geopolitical uncertainties starting in 2019, and the coronavirus pandemic has further stifled the activity in its end markets. Prior to 2020, Kymera had already been dealing with headwinds associated with the uncertainties of Brexit and U.S. trade policy. S&P forecasts that the global economy will recover in 2021. Specifically, S&P estimates that North American and eurozone real GDP will expand by 4.0% and 6.1%, respectively, in 2021, which will be just short of offsetting the contraction the rating agency anticipates for 2020. However, S&P expects the recovery in Kymera's end markets to be well behind these industry-wide expectations. That is because the significant reduction in global air travel has led the airlines to defer or cancel their orders. Furthermore, the industrial segments, which have been facing COVID-19 related plant shutdowns since the end of March 2020, were hard hit by the pandemic and S&P anticipates their turnaround will lag the general economic recovery. S&P expects these end markets to continue to struggle for the balance of 2020 and believe the worst is still ahead for certain of the company's aerospace customers. In response to its deteriorating demand, Kymera has implemented a number of cost-savings initiatives, including shift reductions, furloughs, the elimination of overtime, delaying staff replacements, and selected job eliminations. Despite these initiatives, S&P expects the company's volumes and earnings to continue to decline for the second half of 2020, given that the fourth quarter is generally a seasonally weak quarter, even as its revenue rises by about 10% for the year due to the Reading acquisition, which accounts for roughly one-third of its gross margin." S&P expects Kymera to maintain sufficient liquidity over the next 12 months despite its difficult operating environment. The company's global footprint and supplier relationships enable it to support a diverse group of customers spread all over the world. Given the current broad economic decline, these attributes are what lead S&P to forecast a measured and prolonged recovery. However, S&P anticipates that these attributes would also partially insulate Kymera from sharp region- or industry-specific declines. Furthermore, the company's toll-based pricing structure allows it to pass through a large portion of the volatility in its commodity costs to its customers. In recent months, this has limited the effect of low commodity prices on its revenue, thus most of the decline in its performance has been because of its decreasing volumes. S&P expects Kymera to generate nominal levels of free operating cash flow (FOCF; operating cash flow less capital spending) over the next 12???24 months, especially if the recovery is slower than S&P anticipates or if the ongoing weather related shutdown at a key customer is not resolved in a timely manner. Notably, the company ended the second quarter of 2020 with just under $90 million in cash and revolving credit facility availability. This compares with its modest cash requirements, including most notably just under $11 million in mandatory annual debt amortization. Kymera has been acquisitive in the past, though S&P does not expect it to initiate such outflows in 2020 and forecast sustained capital spending of about $5 million before rising to more normalized levels in 2021. "The stable outlook reflects our expectation that Kymera's debt leverage will stay above 6x over the next 12 months. Nevertheless, we anticipate the company will maintain adequate liquidity despite our forecast for a prolonged recovery in its end markets," S&P said. "We could lower our ratings on Kymera if its earnings deteriorate sharply, possibly due to a delayed recovery in its key end markets or the permanent loss of one or more key customers," the rating agency said. Specifically, S&P would downgrade the company if: -- Its interest coverage fell below 1x; or -- The cushion under its financial covenant declined below 15%; or -- S&P assessed its liquidity as less than adequate. S&P could raise its ratings on Kymera if its end markets recover and its volumes improve closer to its expectations pro forma for the Reading acquisition. Under this scenario S&P would expect: -- Interest coverage of more than 2x; -- Debt leverage of less than 6x; and -- EBITDA margins of greater than 10%. ALPHATEC HOLDINGS: Expects Q3 Revenue Growth of 41% to 43% ---------------------------------------------------------- Alphatec Holdings, Inc., reports preliminary, unaudited financial results for the third quarter ended Sept. 30, 2020. Preliminary, unaudited third quarter 2020 results are expected to reflect U.S. revenue growth of 41% to 43% compared to third quarter 2019. Growth was driven primarily by the continuing rapid adoption of recently released ATEC technologies and strong pull-through from the SafeOp Neural InformatiX System. New product sales represented over 70% of estimated U.S. revenue for the quarter. At Sept. 30, 2020, the Company had approximately $41 million in cash and available borrowings under its senior secured credit facility. "In a year of considerable uncertainty, ATEC is bringing predictability to both the clinical experience and financial performance," said Pat Miles, chairman and chief executive officer. "We continue to deliver against the priorities that we committed to early this year: creating clinical distinction, revitalizing the sales force, and compelling surgeon adoption. This team has created significant value by advancing surgical outcomes in spine before, and we are fully committed to doing it again." The Company expects to announce third quarter financial and operating results on Nov. 5, 2020, after the market close. On that day, the Company will host a live webcast at 1:30 p.m. PT / 4:30 p.m. ET. The live webcast will be accessible via this link. An audiocast of the presentation will also be available domestically at (877) 556-5251 and internationally at (720) 545-0036. The conference ID number is 5178028. A replay of the webcast will remain available on ATEC's corporate website at www.atecspine.com until the Company releases fourth quarter financial results. In addition, a replay of the audiocast will be available until Nov. 15, 2020. The replay dial-in numbers are (855) 859-2056 for domestic callers and (404) 537-3406 for international callers. Please use the replay conference ID number 5178028. About Alphatec Holdings Alphatec Holdings, Inc. (ATEC) (www.atecspine.com), through its wholly-owned subsidiaries, Alphatec Spine, Inc. and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC architects and commercializes approach-based technology that integrates seamlessly with the SafeOp Neural InformatiX System to provide real-time, objective nerve information that can enhance the safety and reproducibility of spine surgery. Alphatec reported a net loss of $57 million for the year ended Dec. 31, 2019, compared to a net loss of $28.97 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $161.13 million in total assets, $42.79 million in total current liabilities, $66.07 million in long-term debt, $191,000 in operating lease liability, $9.65 million in other long-term liabilities, $23.60 million in redeemable preferred stock, and $18.82 million in total stockholders' equity. ALPHATEC HOLDINGS: Offering $85 Million Worth of Common Stock ------------------------------------------------------------- Alphatec Holdings, Inc. has commenced an underwritten public offering of $85 million of shares of its common stock. In connection with the offering, ATEC intends to grant the underwriters a 30-day option to purchase up to an additional 15% of the number of shares of common stock sold in the offering. All of the shares in the offering are to be sold by ATEC. There can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering. Morgan Stanley and Cowen are acting as joint book-running managers in the offering. Canaccord Genuity LLC is acting as lead manager in the offering with Lake Street Capital Markets, LLC and Northland Capital Markets acting as co-managers. The shares of common stock are being offered pursuant to a shelf registration statement on Form S-3 (File No. 333-241677) previously filed with and declared effective by the Securities and Exchange Commission. The offering will be made only by means of a written prospectus and prospectus supplement. A preliminary prospectus supplement and accompanying prospectus relating to the offering will be filed with the SEC and will be available on the SEC's website at www.sec.gov. When available, copies of the preliminary prospectus supplement and accompanying prospectus may also be obtained from Morgan Stanley, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, New York 10014, or by e-mail at prospectus@morganstanley.com or Cowen, c/o Broadridge Financial Solutions, Attn: Prospectus Department, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (833) 297-2926 or by email at PostSaleManualRequests@broadridge.com. About Alphatec Holdings Alphatec Holdings, Inc. (ATEC) (www.atecspine.com), through its wholly-owned subsidiaries, Alphatec Spine, Inc. and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC architects and commercializes approach-based technology that integrates seamlessly with the SafeOp Neural InformatiX System to provide real-time, objective nerve information that can enhance the safety and reproducibility of spine surgery. Alphatec reported a net loss of $57 million for the year ended Dec. 31, 2019, compared to a net loss of $28.97 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $161.13 million in total assets, $42.79 million in total current liabilities, $66.07 million in long-term debt, $191,000 in operating lease liability, $9.65 million in other long-term liabilities, $23.60 million in redeemable preferred stock, and $18.82 million in total stockholders' equity. ALTRA MORTGAGE: Hires Michael Jay Berger as Counsel --------------------------------------------------- ALTRA Mortgage Capital LLC seeks authority from the US Bankruptcy Court for the Central District of California to hire the Law Offices of Michael Jay Berger to represent in its Chapter 11 bankruptcy proceeding. The firm will provide all legal services reasonably required to represent Debtor in its Chapter 11 bankruptcy proceeding. These services will include, and have included, communicating with creditors of the Debtor, reviewing the Debtor's Chapter 11 bankruptcy petition and all supporting schedules, advising the Debtor of its legal rights and obligations in a bankruptcy proceeding, working to bring the Debtor into full compliance with reporting requirements of the Office of the United States Trustee, preparing status reports as required by the Court, and responding to any motions filed in Debtor's bankruptcy proceeding. In addition, Applicant will respond to creditor inquiries, review proofs of claim filed in Debtor???s bankruptcy, object to inappropriate claims, prepare Notices of Automatic Stay in all state court proceedings in which the Debtor is sued during the pending of Debtor's bankruptcy proceeding and, if appropriate, prepare a Disclosure Statement and Plan of Reorganization for the Debtor. The firm will charge these hourly rates: Sofya Davtyan, Senior Associate $495 Carolyn M. Afari, Mid-level Associate Attorney $395 Samuel Boyamian, Associate Attorney $350 Senior Paralegals and Law clerks $225 Bankruptcy Paralegals $200 The retainer fee is $20,000. Michael Jay Berger, Esq., disclosed in court filings that he has no prior economic, business or personal connections to Debtor, its creditors and other parties. The firm can be reached through: Michael Jay Berger, Esq. Law Offices of Michael Jay Berger 9454 Wilshire Boulevard, 6th Floor Beverly Hills, CA 90212 Tel: (310) 271-6223 E-mail: michael.berger@bankruptcypower.com About ALTRA Mortgage Capital LLC ALTRA Mortgage Capital LLC sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 20-11653) on Sep. 10, 2020. At the time of filing, the Debtor estimated 50,000 in assets and $500,001 to $1 million in liabilities. Law Offices of Michael Jay Berger represents the Debtor as counsel. AMC THEATERS: Mulls Bankruptcy Filing as Moviegoers Stay Home ------------------------------------------------------------- Katherine Doherty, Davide Scigliuzzo, and Kelly Gilblom of Bloomberg News report that AMC Entertainment Holdings Inc. has considered a range of options that include a potential bankruptcy to ease its debt load as the pandemic keeps moviegoers from attending and studios from supplying films. Lenders to the world's biggest cinema chain have held preliminary talks among themselves about providing the movie-theater company with financing if it decides to file for Chapter 11 court protection, according to people with knowledge of the matter. The fresh cash would keep AMC in business while it crafts a recovery plan, the people said. No formal proposals have been exchanged with AMC, said the people, who asked not to be identified discussing a private matter. The situation remains fluid and plans could change, depending on negotiations and market conditions, the people said. This includes the impact of the coronavirus, with ticket sales suffering because state and local officials are urging moviegoers to stay home. Run Out of Cash AMC said in a filing Tuesday that cash could run out by the end of this year or early next year if attendance doesn't pick up, and it's exploring actions to boost liquidity that include asset sales, renegotiating leases, joint ventures and debt or equity financing. There???s significant risk that its efforts will fall short or fail, AMC warned. Lenders are getting advice from lawyers at Gibson Dunn & Crutcher and bankers at Greenhill & Co., Bloomberg previously reported. Cinema chains are facing a chicken-and-egg problem with no near-term solution: As local capacity restrictions and audience skittishness keep U.S. theaters largely empty, studios are delaying most of their major film releases into 2021 and beyond, which gives consumers still less reason to buy tickets. AMC's attendance since the resumption of business in the U.S. is down about 85% from the same period a year ago, the company said. About AMC Entertainment AMC Entertainment Holdings, Inc., is engaged in the theatrical exhibition business. It operates through theatrical exhibition operations segment. It licenses first-run motion pictures from distributors owned by film production companies and from independent distributors. The Company also offers a range of food and beverage items, which include popcorn; soft drinks; candy; hot dogs; specialty drinks, including beers, wine and mixed drinks, and made to order hot foods, including menu choices, such as curly fries, chicken tenders and mozzarella sticks. It operates over 900 theatres with 10,000 screens globally, including over 661 theatres with 8,200 screens in the United States and over 244 theatres with approximately 2,200 screens in Europe. The Company's subsidiary also includes Carmike Cinemas, Inc. AMC Theatres has taken a major financial hit by the shutdowns of its locations across the country due to the coronavirus pandemic. With the company saddled in debt even before the pandemic hit, AMC Theatres has been on the verge of bankruptcy since it closed its locations in mid-March 2020. By Sept. 4, 2020, 70% of all U.S. AMCs resumed operations but ticket sales have remained low. AMERICAN TIMBER: Seeks Approval to Retain Operations Manager ------------------------------------------------------------ American Timber Marketing Group, LLC seeks approval from the U.S. Bankruptcy Court of the Southern District of West Virginia to retain David Alan Rice, the company's operations manager. Mr. Rice manages the operation of American Timber's saw mill and log home manufacturing facility in Nallen, W. Va. His duties require him to dedicate at least 40 hours per week in his capacity as manager. American Timber pays Mr. Rice a monthly salary of $6,000. Mr. Rice holds office at: David Alan Rice 8960 Wilderness Highway Nallen, WV 26680 Telephone: (304) 438-8933 About American Timber Marketing Group, LLC Based in Nallen, W. Va., American Timber Marketing Group, LLC is a privately held company in the hardwood lumber business. American Timber Marketing Group sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W. Va. Case No. 20-20341) on Sept. 24, 2020. At the time of the filing, Debtor had total assets of $1,005,279 and liabilities of $1,221,883. Judge B. Mckay Mignault oversees the case. Roop Law Office, LC is Debtor's legal counsel. AMERICAN TIMBER: Seeks to Hire Roop Law Office as Legal Counsel --------------------------------------------------------------- American Timber Marketing Group, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of West Virginia to employ Paul Roop, II, Esq., of Roop Law Office, L.C, as its legal counsel. The professional services to be rendered by the attorney are as follows: a. give the debtor legal advice with respect to its powers and duties; b. prepare legal papers; c. perform all other legal services for the Debtor. Roop Law Office has been paid a retainer for legal services in the sum of $5,000. The hourly rate of Mr. Woop for providing services in the case is $375 while the paralegal rate is $100 per hour. The firm does not represent any interest adverse to the Debtor or its estate. The firm can be reached through: Paul W. Roop, II, Esq. ROOP LAW OFFICE, L.C. P.O. Box 1145 Beckley, WV 25802 Telephone: (304) 255-7667 Facsimile: (304) 256-2295 About American Timber Marketing Group, LLC Based in Nallen, W. Va., American Timber Marketing Group, LLC is a privately held company in the hardwood lumber business. American Timber Marketing Group sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. W. Va. Case No. 20-20341) on Sept. 24, 2020. At the time of the filing, Debtor had total assets of $1,005,279 and liabilities of $1,221,883. Judge B. Mckay Mignault oversees the case. Roop Law Office, LC is Debtor's legal counsel. AMINE LLC: Seeks to Hire Barry A. Friedman as Legal Counsel ----------------------------------------------------------- Amine LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Alabama to hire Barry A. Friedman & Associates, PC as its legal counsel. The firm will provide the following services to the Debtor: 1. take appropriate action with respect to secured and priority creditors; 2. take appropriate action with respect to voidable preferences and transfers; 3. prepare legal papers; 4. investigate the accounts of the Debtor and the financial transactions related thereto; and 5. perform all other legal services for Debtor in Possession. Barry A. Friedman will be paid an hourly rate of $250 plus expenses. Barry A. Friedman does not represent any interest adverse to the Debtor or its estate. The firm can be reached through: Barry A. Friedman, Esq. Barry A. Friedman & Associates, PC Post Office Box 2394 Mobile, Alabama 36652 About Amine LLC Amine, LLC is a Mobile, Ala.-based convenience store, which conducts business under the name Super Stop. Amine sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ala. Case No. 20-11953) on Aug. 6, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and liabilities of between $100,001 and $500,000. Barry A. Friedman & Associates, PC is the Debtor's legal counsel. ANCHOR GLASS: S&P Cuts ICR to 'SD' on Distressed Debt Exchange -------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based Anchor Glass Container Corp. to 'SD' (selective default) from 'CC'. At the same time, S&P is lowering its issue-level rating on Anchor's second-lien debt to 'D' from 'CC'. The '6' recovery rating is unchanged, indicating S&P's expectation for negligible (0%-10%; rounded estimate: 0%) recovery of principal in the event of a payment default. The rating on the first-lien term loan remains 'CCC+'. The downgrade follows Anchor's announcement that it has completed the debt exchange offer, which S&P views as distressed. On Oct. 9, 2020, Anchor Glass completed its Dutch Auction process in which lenders exchanged their share of the second-lien loan for $60 million of first-lien debt. "We view the proposed exchange as tantamount to default because lenders received less than the original promise of the security," S&P said. "We expect to reevaluate our issuer credit and issue-level ratings on Anchor in the coming days, likely raising our rating on Anchor to the 'CCC' category to reflect our view that the company's capital structure remains unsustainable. Our review will focus on the long-term viability of the company's capital structure against a backdrop of accelerating secular shifts away from glass packaging amid the COVID-19 pandemic," the rating agency said. ARCHDIOCESE OF NEW ORLEANS: TMI Trust Removed as Committee Member ----------------------------------------------------------------- David Asbach, acting U.S. trustee for Region 5, disclosed in a court filing that the following creditors are the remaining members of the official committee of unsecured creditors in the Chapter 11 case of of the Roman Catholic Church of the Archdiocese of New Orleans: 1. James Adams (Chairperson) c/o Richard C. Trahant, Esq. Attorney at Law 2908 Hessmer Ave. Metairie, LA 70002 Phone: 504-780-9891 Fax: 504-780-7741 trahant@trahantlawoffice.com 2. Patricia Moody c/o Brittany R. Wolf-Freedman Gainsburgh, Benjamin, David, Meunier & Warshauer, LLC 2800 Energy Centre 1100 Poydras Street New Orleans, LA 70163 Phone: 504-522-2304 Fax: 504-528-9973 bwolf@gainsben.com 3. George Coulon c/o Damon J. Baldone, Esq. Damon J. Baldone & Associates 162 New Orleans Blvd. Houma, LA 70364 Phone: 985-868-3427 Fax: 985-872-2319 dbaldone@hotmail.com 4. Theodore Jackson c/o John H. Denenea, Jr. Sheaman-Denenea, LLC 4240 Canal Street, 2nd Floor New Orleans, LA 70119 Phone: 504-304-4582 Fax: 504-304-4587 jdenenea@midcitylaw.com 5. Jackie Berthelot c/o Richard C. Trahant, Esq. Attorney at Law 2908 Hessmer Ave. Metairie, LA 70002 Phone: 504-780-9891 Fax: 504-780-7741 trahant@trahantlawoffice.com 6. Eric Johnson c/o John H. Denenea, Jr. Sheaman-Denenea, LLC 4240 Canal Street, 2nd Floor New Orleans, LA 70119 Phone: 504-304-4582 Fax: 504-304-4587 jdenenea@midcitylaw.com TMI Trust Company's name did not appear in the notice. The company was appointed as committee member on June 10, court filings show. About the Archdiocese of New Orleans The Roman Catholic Church of the Archdiocese of New Orleans is a non-profit religious corporation incorporated under the laws of the State of Louisiana. For more information, visit https://www.nolacatholic.org/ Created as a diocese in 1793, and established as an archdiocese in 1850, the Archdiocese of New Orleans has educated hundreds of thousands in its schools, provided religious services to its churches and provided charitable assistance to individuals in need, including those affected by hurricanes, floods, natural disasters, war, civil unrest, plagues, epidemics, and illness. Currently, the archdiocese's geographic footprint occupies over 4,200 square Miles in southeast Louisiana and includes eight civil parishes -- Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. John the Baptist, St. Tammany, and Washington. The Roman Catholic Church for the Archdiocese of New Orleans sought Chapter 11 protection (Bankr. E.D. La. Case No. 20-10846) on May 1, 2020. The archdiocese was estimated to have $100 million to $500 million in assets and liabilities as of the bankruptcy filing. Judge Meredith S. Grabill oversees the case. The archdiocese is represented by Jones Walker LLP. Donlin, Recano & Company, Inc. is the claims agent. The Office of the U.S. Trustee appointed a committee of unsecured creditors on May 20, 2020. The committee is represented by Pachulski Stang Ziehl & Jones, LLP and Locke Lord, LLP. Berkeley Research Group, LLC is the committee's financial advisor. ASCEND LEARNING: S&P Lowers First-Lien Debt Rating to 'B-' ---------------------------------------------------------- S&P Global Ratings affirmed its 'B-' issuer credit rating on U.S.-based Ascend Learning LLC. At the same time, S&P lowered its rating on the first-lien credit facility to 'B-' from 'B' and revised the recovery rating to '3' from '2', to reflect the increase in first-lien debt and decline in recovery prospects from the proposed transaction. The '3' recovery rating reflects its expectation of a meaningful (50%-70%; rounded estimate: 65%) recovery in the event of a default. S&P affirmed its 'CCC' rating on the company's unsecured notes and '6' recovery rating. Concurrently, S&P is assigning its 'B-' rating and '3' recovery rating to the proposed $350 million incremental term loan B due 2024. "The stable outlook reflects our expectation that Ascend will continue to report healthy organic growth and generate FOCF of about $50 million, such that leverage improves to the mid-7x area over the next 12 months," S&P said. "The affirmation reflects Ascend's better-than-expected first-half 2020 operating performance and our expectation for continued earnings growth, resulting in credit metrics improvement over the next 12 months," the rating agency said. Ascend's operating performance was above S&P's expectations, with net revenues and adjusted EBITDA growth of roughly 14% and 22%, respectively during the first half of this year mainly from robust growth in the clinical health care and fitness and wellness segments. Pro forma for the proposed transaction, S&P Global Ratings-adjusted leverage is 8.8x as of June 30, 2020, up from 7x before the deal and is expected to decrease to around 8x by year-end 2020. Relative to its initial forecast of mid- to high-single-digit percentage revenue growth and about $175 million in adjusted EBITDA in 2020, S&P now forecasts revenue growth of about 15% and about $215 million in adjusted EBITDA. S&P expects solid nursing enrollment growth, market share gains, and strong growth in higher-margin product offerings in clinical health care and fitness wellness segments, supported by the company's new remote proctoring solutions offerings. S&P also expects margins to expand on cost savings from virtual delivery and operating leverage. S&P expects Ascend to maintain its aggressive financial policies and manage its leverage above 7x under its equity sponsor owners, Blackstone Group Inc. and Canada Pension Plan Investment Board. Ascend plans to raise incremental debt to partially fund a $390 million dividend to its owners. Although S&P believes that continued solid operating performance should help moderate leverage to about 7.5x and grow FOCF generation over the next 12 months, the rating agency believes any significant credit metric improvements will be temporary and Ascend will continue to opportunistically reward its private-equity sponsors with dividends or pursue debt-funded acquisitions rather than prioritizing debt repayment. S&P has not forecast any large acquisitions over the next 12 months, rather it expects Ascend will continue to invest in its platform and make small tuck-in acquisitions with cash to increase capabilities and new product offerings. Ascend has good growth prospects because of favorable business relationships, market position, and opportunities to expand product offerings in the health care sector. Ascend has a leading market position in the highly fragmented clinical health care education segment with long-standing business-to-business customer relationships with high retention rates and multiyear agreements, including over 70% of nursing schools in the U.S. In addition to its large customer base, Ascend has favorable growth prospects because of regulatory and accreditation requirements in the clinical health care sector. Increased demand for health care professionals due to the aging U.S. population and shortage of physicians and nurses will continue to support enrollment growth in the institutions that Ascend counts as customers. These secular factors will continue to present favorable nursing employment opportunities and demand for Ascend's products, even in an economic downturn. Furthermore, the company's strategy to expand product offerings in its core segments and investments in adjacent markets could boost revenue growth longer term. Ascend faces high levels of competition and lacks geographic diversity despite a good competitive position. Ascend has a niche focus in the health care end markets, has smaller scale than its peers, and low geographic diversity. The company competes against larger and better-capitalized peers such as Kaplan Education, a subsidiary of Graham Holdings Co. With the exception of its U.K. Premier Global business (under the Fitness & Wellness segment), Ascend has limited geographic diversity outside the U.S. In S&P's view, there are relatively low barriers to entry with minimal switching costs that would afford market share protection for Ascend, particularly in the Fitness & Wellness and Professional Education business segments. The stable outlook reflects S&P's expectation that Ascend will report healthy organic growth from continued demand for medical professionals that will drive revenue in the company's core verticals. S&P expects Ascend's credit metrics to improve over the next 12 months on earnings growth, with debt to EBITDA in the mid-7x area and FOCF to debt of about 4% by the end of 2021. "We could lower the rating over the next 12 months if operating performance deteriorates, leading to sustained negligible FOCF. This could occur if Ascend faces operating challenges such as inability to sufficiently grow its revenues due to failed product launches, loss of key customers to competition, or inability to integrate significant acquisitions. We could also lower the rating if we expect the company to face liquidity challenges over the next 12 months," S&P said. "An upgrade is unlikely over the next 12 months and will be driven primarily by a change in the company's financial policy. For an upgrade, we would look for the company to exhibit a track record of maintaining adjusted debt leverage below 7.5x and adjusted FOCF above 5%," the rating agency said. ASPIRA OF FLORIDA: Files for Chapter 7 Liquidation Due to Pandemic ------------------------------------------------------------------ Brian Bandell of South Florida Business Journal reports that ASPIRA of Florida, an educational nonprofit that previously ran charter schools in South Florida, filed for Chapter 7 liquidation amid the impact of the Covid-19 pandemic. Founded in 1981, the Miami-based organization was dedicated to the social advancement of the Puerto Rican/Latino community through education and leadership programs. It previously ran the ASPIRA Raul Arnaldo Martinez Center School, the ASPIRA Arts DE/CO Charter School, the ASPIRA Eugenio Maria de Hostos Charter School and the ASPIRA South Youth Leadership Charter School, but they were all voluntarily closed in 2019. The organization continued with its leadership training programs for youths. Many of the programs served children in after-school clubs, but the pandemic forced most education online. "It's a very unfortunate situation, driven in large part by the impact of the pandemic," said Miami attorney Luis Salazar, who represents the organization in the bankruptcy. About ASPIRA of Florida ASPIRA of Florida, Inc. started in 1982 as ASPIRA Youth Leadership Program, as a part of the national APSIRA Association, with a vision to empower the Puerto Rican and Latino community through advocacy and the education and leadership development of its youth. In 2000, ASPIRA opened its first charter school in Miami, ASPIRA Raul Arnaldo Martinez (RAM) Charter School. It has since opened up two other schools, ASPIRA Leadership and College Preparatory Academy (LCPA) and ASPIRA Arts Design Communication (Arts DECO) Charter School. ASPIRA RAM and ASPIRA Arts DECO currently serve grades 6-8 and ASPIRA LCPA serves grades K-2 and 6-8. ASPIRA of Florida, Inc., ASPIRA Properties, Inc., and ASPIRA Support Organization, Inc., filed Chapter 7 bankruptcy petitions (Bankr. S.D. Fla. Case Nos. 20-20930 to 20-20932) on Oct. 6, 2020. Each of the three cases listed assets of less than $50,000. Miream Sierra was listed as the president and CEO. The Debtors' counsel: Luis Salazar, Esq. Salazar Law Tel: 305-374-4848 E-mail: luis@salazar.law BALDUCCI'S & KINGS FOOD MARKETS: Albertson Plans to Buy 27 Stores ----------------------------------------------------------------- Don Day of Boise Deve reports that Albertsons Companies announced Wednesday, October 14, 2020, it would buy up 27 new store locations in the mid-Atlantic region. It also announced a new cash dividend payment for stockholders. The stores, which carry the Kings Food Markets and Balducci's Food Lover's Markets, will fold into Albertsons' Acme Markets division. The stores will keep their current branding -- a practice Albertsons used in other markets across the country. The Kings and Balducci's brands will give Albertsons more than 20 different store banners in the US. "Our company has a history of managing small, differentiated chains that offer an elevated experience, like Andronicos and Haggens in the western U.S.," Albertsons Companies' Mid-Atlantic President Jim Perkins said. "When we leverage their team's expertise and continue to deliver what their customers want, these stores can thrive. We are excited to add these two premium, gourmet banners to our east coast operations." Albertsons will pay $96.4 million for the package of stories. The deal will need approval from the Federal Trade Commission. About KB US Holdings Inc. KB US Holdings, Inc. -- http://www.kingsfoodmarkets.com/and http://www.balduccis.com/-- is the parent company of King Food Markets and Balducci's Food Lover's Market. Kings Food Markets, headquartered in Parsippany, New Jersey, has been a specialty and gourmet food market across the East Coast. In 2009, Kings acquired specialty gourmet retail grocer, Balducci's Food Lover's Market. As of the Petition Date, the Debtors operate 35 supermarkets across New York, New Jersey, Connecticut, Virginia, and Maryland. About Albertsons Cos. Inc. Albertsons Companies Inc. provides customers with a service-oriented shopping experience, including convenient and personalized value-added services, through 1,784 pharmacies, 393 adjacent fuel centers, and home delivery via online and mobile applications. The company is based in Boise, Idaho. BEAMABLE INC: Continues to Operate Despite Bankruptcy Filing ------------------------------------------------------------ Dean Takahashi of Venture Beat reports that Beamable Inc. will still continue its game monetization business despite filing Chapter 11 bankruptcy protection. Game monetization firm Beamable has filed for Chapter 11 bankruptcy protection this week, but in an interview, CEO Jon Radoff said the company still plans to operate. Mr. Radoff said the company hopes to go through a quick bankruptcy process and clean up its balance sheet so it can continue its work handling server and monetization tasks for game developers. "We are not shutting down," he said in an interview with GamesBeat. "We are keeping our employees and last month was the best month we had as Beamable." The Framingham, Massachusetts-based Beamable, formerly known as Disruptor Beam, filed in U.S. Bankruptcy Court in Worcester, Massachusetts, saying it had $3.4 million in liabilities and $637,987 in assets. The creditors include a venture fund that is owed $1 million; Silicon Valley Bank, which processed the company???s Paycheck Protection Program payments and is owed $900,000; and equipment finance firms owed $920,000. As Disruptor Beam, the company made games based on TV shows such as Game of Thrones, The Walking Dead, and Star Trek. It sold off Star Trek: Timelines to Tilting Point in May. At that time, 19 of Disruptor Beam's employees went to work for Tilting Point. And about 14 stayed with Disruptor Beam, which pivoted as Beamable with a focus on monetization and server tasks. About 10 people were laid off in the transition. Radoff said the company had some obligations it no longer needed during the pandemic, such as a lease on offices that could house 150 people that it had for a couple of years. The company no longer needs that space, and it hasn't been able to use it during the pandemic. "The $3 million-plus in liabilities is a lot of liabilities to carry on the balance sheet of a company that is rebooting," Mr. Radoff said. "The reality of Disruptor Beam was that we built some great games, but we weren't really able to turn that into a sustainable business where we could crank out hit after hit. But we did create this very valuable technology platform along the way. We will clean up the balance sheet, and then compete like any other startup." Radoff said the company is seeking to reorganize under the new Subchapter V of the Chapter 11 law, which enables companies to emerge from bankruptcy more quickly. As a result of the COVID-19 pandemic, the CARES act expanded the Small Business Reorganization Act (SBRA) to include companies such as Beamable. Under the process of a Subchapter V restructuring, the court appoints a trustee. Beamable will work with the trustee and remaining creditors to propose a restructuring plan, Radoff said. This will provide for a streamlined and efficient process that will minimize distraction to the business and permit the employees to focus on providing service to customers, Radoff said. He said the company has the support of its investors, but he noted that having a clean balance sheet will help position it as a startup that could, in the future, once again raise some money. "The last thing our investors wanted was a messy balance sheet," Radoff said. "We hope to get through this in a short time. We're keeping our employees. We think this is in everybody's collective interest." Radoff said Star Trek: Timelines uses Beamable, as does East Side Games??? Archer: Danger Phone. He said new customers are signing up at about a rate of one per day for the company's software-as-a-service subscription. Beamable works with Unity's game engine. It competes with Microsoft???s PlayFab, GameSparks, and Heroic Labs. "We see our service as like a Unity game engine for the server," Radoff said. "We handle the social and the monetization, making that easier for developers. And people really like what we are doing." About Beamble Inc. Beamable, Inc. -- https://www.beamable.com/ -- is a software company in Framingham, Massachusetts. Beamable enables game makers to easily add social, commerce and content management features to their games with drag-and-drop prefabs inside Unity3D without the need of a game server. A Unity package features ready-to-ship user interfaces distilled from best-practices with every feature, and a visual skinning designer so they seamlessly integrate with the developer's game. Beamable, Inc., formerly Disruptor Beam, Inc., sought Chapter 11 protection (Bankr. D. Mass. Case No. 20-40986) on Oct. 1, 2020. In the petition signed by Jon Radoff, CEO, the Debtor disclosed total assets of $637,987 and total liabilities of $3,356,584. ASCENDANT LAW GROUP LLC, led by Jesse I. Redlener, is the Debtor's counsel. BENJA INCORPORATED: Voluntary Chapter 11 Case Summary ----------------------------------------------------- Debtor: Benja Incorporated 845 Market Street, 450A San Francisco, CA 94103 Business Description: Benja Incorporated -- https://benja.co -- operates a shoppable media network. Chapter 11 Petition Date: October 15, 2020 Court: United States Bankruptcy Court Northern District of California Case No.: 20-30819 Judge: Hon. Dennis Montali Debtor's Counsel: Paul S. Manasian, Esq. 1310 65th St Emeryville, CA 94608 Tel: 415-730-3419 E-mail: manasian@mrlawsf.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Andrew J. Chapin, president & CEO. 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/JJG4LAQ/Benja_Incorporated__canbke-20-30819__0001.0.pdf?mcid=tGE4TAMA BMZ LLC: Seeks to Hire Steven M. Fishman as Bankruptcy Counsel -------------------------------------------------------------- BMZ, LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Steven M. Fishman, P.A. as its bankruptcy counsel. The professional services to be rendered by Steven M. Fishman are: a. analyze the financial situation, and render advice and assistance to the Debtor; b. advise the Debtor with regard to its powers and duties; c. prepare legal documents required by the court; d. represent the Debtor at the Section 341 Creditors' meeting; e. give the Debtor legal advice with respect to its powers and duties f. advise the Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements and with the rules of the court; g. prepare legal papers; h. protect the interest of the Debtor in all matters pending before the court; i. represent the Debtor in negotiation with its creditors in the preparation of the Chapter 11 plan; and j. perform all other bankruptcy related legal services for the Debtor. The firm will be paid at hourly rates as follows: Steven Fishman, Esq. $350 Assistant Attorney $150 Paralegal $75 The Debtor has agreed to pay a retainer in the amount of $10,000, plus $2,500 for costs. Steven Fishman, Esq., an attorney at the firm, disclosed in court filings that the firm does not represent any interest potentially adverse to the Debtor or its estate. The firm can be reached through: Steven M. Fishman, Esq. Steven M. Fishman, P.A. 2454 McMullen Booth Road, Suite D0607 Clearwater, FL 33759 Telephone: (727) 724-9044 E-mail: steve@attorneystevenfishman.com About BMZ, LLC Based in Clearwater, Fla., BMZ, LLC is a privately held company in the fast food and quick service restaurants business. BMZ sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-07203) on Sept. 26, 2020. Scott Zieba, managing member, signed the petition. At the time of the filing, Debtor had estimated assets of between $100,000 and $500,000 and liabilities of between $1 million and $10 million. Steven M. Fishman, PA is Debtor's legal counsel. BOOTS SMITH: Seeks Approval to Hire Horne LLP as Accountant ----------------------------------------------------------- Boots Smith Completion Services, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Mississippi to hire Horne, LLP as its accountant. The firm will provide accounting services to the Debtor in connection with its Chapter 11 case. The firm will receive compensation at its usual and customary hourly rates and reimbursement of actual, necessary expenses. Wes T. Winborne, a certified public accountant at Horne, LLP, disclosed in court filings that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Wes T. Winborne, CPA Horne, LLP 661 Sunnybrook Road, Suite 100 Ridgeland, MS 39157 Telephone: (601) 326-1000 Email: wes.winborne@hornellp.com About Boots Smith Boots Smith Completion Services, LLC, is an oilfield service company, helping oil and gas companies enhance production through a variety of applications, including completion, workover, and optimization. Boots Smith sought Chapter 11 protection (Bankr. S.D. Miss. Case No. 20-51081) on July 1, 2020. At the time of filing, the Debtor was estimated to have up to $50,000 in assets and $10 million to $50 million in liabilities. William J. Little, Jr., Esq., at Lentz & Little, P.A. is the Debtor's counsel. BOY SCOUTS: Victims Ask Court for Role in Chapter 11 Case --------------------------------------------------------- Law360 reports that the proceedings got testy at times as a coalition representing thousands of individuals who have lodged sexual abuse allegations against the Boy Scouts argued Wednesday, October 14, 2020, for an expanded role in the organization's Chapter 11 case and its determination of how victims will be compensated. During an all-day virtual hearing, the ad hoc Coalition of Abused Scouts for Justice told U.S. Bankruptcy Judge Laurie Selber Silverstein that the group should have a seat at the negotiating table in the Boy Scouts of America's Chapter 11 proceedings as mediators work to steer the bankruptcy toward a plan to make distributions to creditors. About Boy Scouts of America The Boy Scouts of America -- https://www.scouting.org/ -- is a federally chartered non-profit corporation under title 36 of the United States Code. Founded in 1910 and chartered by an act of Congress in 1916, the BSA's mission is to train youth in responsible citizenship, character development, and self-reliance through participation in a wide range of outdoor activities, educational programs, and, at older age levels, career-oriented programs in partnership with community organizations. Its national headquarters is located in Irving, Texas. The Boy Scouts of America and affiliate Delaware BSA, LLC sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on Feb. 18, 2020, to deal with sexual abuse claims. Boy Scouts of America was estimated to have $1 billion to $10 billion in assets at least $500 million in liabilities as of the bankruptcy filing. The Debtors tapped Sidley Austin LLP as general bankruptcy counsel; Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel; and Alvarez & Marsal North America, LLC as financial advisor. Omni Agent Solutions is the claims agent. CAH ACQUISITION: Selling All Assets to Lauderdale for $8 Million ---------------------------------------------------------------- CAH Acquisition Company 11, LLC, asks the U.S. Bankruptcy Court for the District of Kansas to authorize the bidding procedures in connection with the sale of substantially all assets to Lauderdale Community Hospital, LLC for a cash purchase price of 8 million cash at closing plus assumption of the Assumed Liabilities, subject to overbid. Prior to the Petition Date, the Debtor owned and operated the Lauderdale Community Hospital, a critical access hospital located in Ripley, Tennessee. Since the Petition Date, the Debtor has worked diligently toward providing continued healthcare treatment and services by the Lauderdale Community Hospital to the citizens of Lauderdale County, Tennessee and surrounding counties. Prior to filing the bankruptcy petition, Stone Bank filed a civil action against the Debtor on Jan. 8, 2019 in the Chancery Court of Lauderdale County, Tennessee (Case No. 15859). Subsequently, on Jan. 14, 2019, the Debtor removed the Civil Action to the U.S. District Court for Western District of Tennessee (Case No. 19-02040). At the time of removal, Stone Bank had pending requests in state court for the appointment of a receiver and other injunctive relief. Stone Bank had been, at the time of removal, granted a Temporary Restraining Order by the Chancery Court. The District Court extended the TRO until the entry of a subsequent order which appointed Marianna Williams, Special Master, and as Special Master she was directed to obtain, review and evaluate the financial records and operations of the Debtor and make a report to the District Court of her findings by the close of business on Feb. 18, 2019. A final hearing was held on Feb. 21, 2019 to determine whether to grant Stone Bank's request for the appointment of a receiver. The District Court found that there were sufficient grounds for the appointment of a receiver for the Debtor, and the Court orally granted the Motion for Appointment of Marianna Williams. The Court entered the Order Appointing Receiver and Granting Related Injunctive Relief on Feb. 27, 2019. With Receiver Order, the District Court issued a stay of all acts, actions or proceedings to obtain possession of, exercise control over, or enforce a judgment against receivership property and to enforce a lien against receivership property to the extent the lien secures a claim against Debtor. The stay applied to any judgment creditor seeking to enforce a judgment against any funds in Debtor's account(s). On March 6, 2019, an Expedited Motion for Authority to File Bankruptcy was filed with the District Court, seeking approval to allow Ms. Williams to file a petition for relief under the Bankruptcy Code. On March 7, 2019, the District Court granted Ms. Williams' Motion for Authority to file Bankruptcy, thereby giving Ms. Williams the authority to file the instant case. Subsequently, on March 13, 2019, the District Court clarified its March 7, 2019 order and specifically granted Ms. Williams all rights, powers and duties of DIP and that she be authorized to not only administer the assets of the Debtor but also to act for and on behalf of the Debtor. Since her appointment over the Debtor's assets, Ms. Williams has become familiar with the business of the Debtor. As a part of efforts to stabilize the operations of Lauderdale Community Hospital, a management agreement was negotiated with Cohesive Healthcare Management + Consulting, LLC. Since the execution of the management agreement, Cohesive has handled the day to day management of the hospital. With the assistance and support of Stone Bank, the Receiver instituted a marketing campaign for the sale of the assets of the Debtor. The Debtor asserts that, given the nature of the hospital industry and the status of current operations that it is imperative to promptly seek a sale of substantially all of its assets. It proposes to effectuate a sale of the assets of Lauderdale Community Hospital pursuant to certain bidding and sale procedures as authorized by the Court. The Debtor received the Stalking Horse Bid in the form of an Asset Purchase and Sale Agreement from the Proposed Buyer to purchase certain assets as that term is defined in the Proposed APA for a cash purchase price of $8 million at closing plus assumption of the Assumed Liabilities. The Proposed Purchase Price will be funded by the Proposed Buyer through a combination of cash funded directly by the Proposed Buyer and the Buyer's Financing. The Proposed APA provides for, among other things, the Sale of the Acquired Assets free and clear of any and all liens, claims, encumbrances, and other interests, along with the assumption of certain executory contracts and unexpired leases. The Acquired Assets constitute substantially all of the Debtor's assets, but do not include estate causes of action. The Acquired Assets includes the rights to receive the remaining proceeds of the CARES Act Provider Relief Funds as of the Closing if allowable by order of the Bankruptcy Court and/or agreement with the United States Department of Human Services. In connection with maximizing the value of the Debtor's estate, the Debtor asks to establish reasonable bid and sales procedures in order to solicit higher and better cash offers for the Acquired Assets and to provide for an auction, if necessary. To that end, the Debtor requests entry of an order establishing bidding procedures and an order authorizing the Sale of the Purchased Assets to Lauderdale Community Hospital, LLC or such other party (or parties) that may submit a higher and better offer for the Acquired Assets. Additionally, in connection with the Bidding Procedures, the Debtor asks the Court's approval of the form and manner of notices to be provided to counterparties to potentially assumed and assigned executory contracts or unexpired leases, which will include the amounts that the Debtor believes is necessary to cure any defaults thereunder. The Debtor proposes the following timeline: a. Bid and Sale Procedures, Bid Protections Hearing - Sept. 29, 2020 at 10:00 a.m. (CT) b. Solicitations of Competing Bids - Commenced immediately after entry of the Bidding Procedures Order c. Notice to Contract/Lease Parties of Potential Assignment or Rejection - Commenced immediately after entry of the Bidding Procedures Order d. Proposed Cure Schedule - Oct. 20, 2020 e. Competing Bid Deadline - Oct. 27, 2020 at 10:00 a.m. (CT) f. Auction, if necessary, and Announce Results - Oct. 29, 2020 at 1:00 p.m. (CT) at the offices of Baker Donelson Bearman Caldwell & Berkowitz, PC, 165 Madison Avenue, Suite 2000, Memphis, TN, or at such later time as determined by the Debtor, who will notify all Qualified Bidders, Stone Bank, and the United States Trustee. Due to concerns related to COVID-19, the Auction may be conducted via Zoom or similar electronic means. g. Contract/Lease and Sale Hearing Objection Deadline - Oct. 30, 2020 at 5:00 p.m. (CT) h. Sale Hearing - Nov. 3, 2020 at 10:00 a.m. (CT) i. Closing Deadline - Nov. 30, 2020 The Debtor notes the following important aspects of the Sale Motion and Bidding Procedures: a) At this time, none of the assets are contemplated to be sold to an "insider" within the meaning of 11 U.S.C. Section 101(31). Neither the Proposed Buyer nor the members of the Proposed Buyer are insiders of the Debtor. b) At this time, the Debtor does not anticipate any private sale or elimination of competitive bidding. c) At this time, the Debtor anticipates that the only deadlines that may effectively limit notice involve the potential supplemental notice(s) to parties to executory contracts and unexpired leases, after the Bid eadline and Auction, if any. These limited notice circumstances are unavoidable under the circumstances and mitigated by the general notice being provided to all parties in interest. d) The Debtor is requesting to have the Sale declared exempt from taxes under 11 U.S.C. Section 1146(a). The Debtor will provide notice of the Sale Motion to the relevant taxing authorities. e) At this time, the Debtor anticipates transferring some of the Debtor's business records relating to the ongoing operation of the Lauderdale Community Hospital as part of the Sale process, but also anticipates arranging to have adequate access to, such business records as are needed to pursue any further activity in the case after the Closing. f) At this time, the Debtor does not anticipate selling any avoidance actions under Chapter 5 of the Bankruptcy Code. g) By the Sale Motion, the Debtor asks relief from the 14-day stay imposed by Fed. R. Bankr. P. 6004(h) and 6006(d) for the reasons noted. The other salient terms of the Bidding Procedures are: a. Initial Bid: The bid must offer a purchase price of at least $200,000 more than the Proposed Purchase Price set out in the Proposed APA of the Proposed Buyer and must contain terms and conditions no less favorable to Debtor than the terms and conditions of the Proposed APA. b. Deposit: 5% of the aggregate proposed purchase price in the Overbid c. Bid Increments: $50,000 d. The Debtor acknowledges that Stone Bank will be entitled to credit bid at the Auction. If and only to the extent that any other creditor may claim a security interest in or lien on the assets to be sold at Auction, such creditor will be permitted to exercise its credit bid rights only if such creditor's bid includes cash in an amount (a) necessary to pay the secured claims of Stone Bank in full, or (b) otherwise satisfactory to Stone Bank. e. Bid Protection: $100,000 Break-Up Fee and the Expenses capped at $50,000 The Proposed APA includes provisions (Sections 3.2 and 3.3) whereby the Proposed Buyer may ask the Debtor to assume and assign certain executory contracts and unexpired leases. The Debtor also anticipates that, in the event of an Auction, a Successful Bid at the Auction may include provisions requesting that the Debtor assume and assign, or reject, certain unexpired leases or executory contracts, which may or may not be the same as those requested by the Proposed Buyer. In addition, the Proposed Buyer may add or delete other proposed Acquired Assets at or before the Auction. The Debtor also anticipates that, in the event of an Auction, a Successful Bid at the Auction may add or delete Acquired Assets not specified in the Proposed APA. However, the Debtor does not know exactly which tangible assets may be included or excluded at this time. The Debtor also asks that the Sale Order provide that the Sale of the Acquired Assets is free and clear of any interest held by any third party in any of the assets to be sold. Based on the results of analysis of the Debtor's ongoing and future business prospects and the ownership status of the Debtor, it is asserted that a Sale as a going concern in accordance with the process set forth in the Bidding Procedures is the best method to maximize recoveries and ensure that the value of the Debtor's assets is maintained for the benefit of its creditors and estate. Maximization of asset value is a sound business purpose, warranting authorization of the Sale. In light of the current circumstances and financial condition of the Debtor and the Bankruptcy Estate, the Debtor asserts that in order to maximize value and preserve jobs, the sale of the Acquired Assets should be consummated as soon as practicable. Accordingly, the Debtor requests that the Sale Order be effective immediately upon entry of such order and that the 14-day stay under Bankruptcy Rules 6004(h) and 6006(d) be waived. The Debtor respectfully asks that the notice be shortened and an expedited hearing be set to take up the Debtor's requests in the Sale Motion. A copy of the Agreement and the Bidding Procedures is available at https://tinyurl.com/y5skzg89 from PacerMonitor.com free of charge. About CAH Acquisition Company 11 CAH Acquisition Company 11, LLC, which conducts business under the name Lauderdale Community Hospital, is a provider of health care services including diagnostic and therapeutic services, 24-hour emergency care, convenient and specialized outpatient resources, and pharmaceutical services and other services. On Feb. 27, 2019, Marianna Williams was appointed as receiver. CAH Acquisition Company 11 sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tenn. Case No. 19-22020) on March 8, 2019. At the time of the filing, the Debtor was estimated to have assets of between $1 million and $10 million and liabilities of the same range. The case has been assigned to Judge Paulette J. Delk. Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, is the Debtor's legal counsel. No official committee of unsecured creditors has been appointed in the Chapter 11 case. CARDINAL CARE: Seeks to Hire David A. Boone as Legal Counsel ------------------------------------------------------------ Cardinal Care Management, LLC seeks approval from the U.S. Bankruptcy Court for the Northern District of California to hire the Law Offices of David A. Boone to handle its Chapter 11 case. David Boone, Esq., and Anh Nguyen, Esq., the firm's attorneys who will be providing the services, will charge $450 per hour and $425 per hour, respectively. The firm received $20,000 from the Debtor as a pre-bankruptcy retainer. David A. Boone is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: David A. Boone, Esq. Law Offices of David A. Boone 1611 The Alameda San Jose, CA 95126 Telephone: (408) 291-6000 About Cardinal Care Management Cardinal Care Management, LLC, operator of a residential care facility for the elderly, filed a Chapter 11 petition (Bankr. N.D. Cal. Case No.20-41557) on Sept. 24, 2020. Steve Chou, managing member, signed the petition. The Debtor was estimated to have $0 to $50,000 in assets and $1 million to $10 million in liabilities. Judge Charles Novack oversees the case. The Law Offices of David A. Boone is the Debtor's legal counsel. CBAC PROPERTIES: May Use Rio Bank's Cash Collateral Thru Oct. 21 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Southern District of Texas, McAllen Division, has authorized CBAC Properties, Ltd. to use the cash collateral of Rio Bank on an interim basis. On September 14, 2012, Rio extended to the Debtor a loan in the principal amount of $1,475,000. The Loan is evidenced by a Promissory Note executed by the Debtor in favor of Rio. On October 5, 2017, an extension of Real Estate Note and Lien was executed by the parties. The Debtor disclosed that Rio holds a pre-petition first mortgage lien on the Debtor's real property and improvements located at 1502 W. Pike Blvd., Weslaco, TX 78596 (real property and improvements). The real property is a warehouse. The Debtor believes the real property has a current market value in the amount of $52,225,000.00 based upon the appraisal district valuation and market conditions. As of the Petition Date, Rio held an allowed secured claim against the Debtor for money loaned under the terms of its loan documents in an amount not less than $1,207,581.08, plus accruing interest, reasonable attorneys' fees and costs and other amounts owing under the Loan Documents. As of the Petition Date, Rio held an allowed secured claim against the Debtor for money loaned under the terms of the Loan Documents in an amount not less than $207,581.05, plus accruing interest, reasonable attorneys' fees and costs, and other amounts owing under the Loan Documents. The Interim Order provides Rio is granted a valid, binding, enforceable, and automatically perfected post-petition liens that are co-extensive with Rio's pre-petition liens and security interest in: all currently owned or hereafter acquired property and assets of the Debtor to the extent that such property and assets constitute Rio's Collateral under the Pre-Petition Loan Documents; and all proceeds, products, and profits of the foregoing. The Replacement Liens will be effective and perfected as of the same validity, priority, and enforceability as Rio's lien and security interest in and on the Collateral on the Petition Date. As partial adequate protection to Rio, the Debtor will pay the bank regular monthly payments in the amount of $11,000.00 beginning September 2020, and maintain insurance pursuant to the terms of the Loan Documents with Rio as a named loss payee. The payments (including August 2020) will be applied to accrued interest in the amount of $6,472.00, with the remainder to be placed in escrow to satisfy the 2020 ad valorem taxes. A further hearing on the use of cash collateral is scheduled for October 21 at 10:30 a.m. A full-text copy of the Debtor's motion is available at https://bit.ly/3m2SYtB from PacerMonitor.com. About CBAC Properties, Ltd. CBAC Properties, Ltd., sought Chapter 11 protection (Bankr. S.D. Texas Case No. 20-70233) on Aug. 3, 2020. CBAC Properties, Ltd. is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). At the time of the filing, Debtor disclosed estimated assets of $1 million to $10 million and estimated liabilities of the same range. Judge Eduardo V. Rodriguez oversees the case. Langley & Banack, Inc. is the Debtor's legal counsel. CHARTER SCHOOL OF EDUCATIONAL EXCELLENCE: S&P Rates Rev Bonds 'BB' ------------------------------------------------------------------ S&P Global Ratings assigned its 'BB' long-term rating on Yonkers Economic Development Corp., N.Y.'s $12.4 million series 2020A and 2020B educational revenue and refunding bonds. At the same time, S&P Global Ratings affirmed its 'BB' long-term rating on the corporation's series 2010 educational revenue bonds. All bonds were issued for Charter School of Educational Excellence (CSEE). The outlook is stable. The series 2020 fixed-rate bond proceeds will be used primarily to refund the 2010 bonds outstanding in the amount of $10.6 million. Additionally, proceeds in the amount of $2.0 million will be used to convert an existing leased facility into instructional space for CSEE's growing high school vocational program. "The rating reflects our view of CSEE's weakened pro forma lease-adjusted maximum annual debt service coverage, substantial additional debt, construction risk associated with the high school building project, and inherent risk associated with charter reauthorization," said S&P Global Ratings credit analyst David Holmes. The stable outlook reflects S&P's expectation that during the outlook period, the school will complete its construction projects successfully with no additional cost overruns beyond what management has reported, continue expansion into high school while preserving its kindergarten through 10th-grade enrollment, produce positive operations on a full-accrual basis, and continue to have sufficient liquidity to help offset its highly leveraged debt profile. In S&P's view, Charter School of Educational Excellence is exposed to elevated health and safety social risk given the impact of COVID-19-related economic uncertainty on state funding and the school's dependency on state revenue. Despite the elevated social risk, S&P believes the school's environmental and governance risk are in line with the rating agency's view of the sector as a whole. CHESAPEAKE ENERGY: Gets $85M Chapter 11 Bid for Oklahoma Wells -------------------------------------------------------------- Law360 reports that oil and gas driller Chesapeake Energy Corp. has told a Texas bankruptcy court that it has accepted an $85 million stalking horse bid for its Oklahoma drilling operations from Blackwell Group-created Tapstone Energy Co. In papers filed Tuesday, October 13, 2020, the company asked the court to approve Tapstone's stalking horse offer for 736,000 acres of oil and gas leases in Oklahoma and northern Texas as it heads toward an auction of the assets in two weeks. About Chesapeake Energy Headquartered in Oklahoma City, Chesapeake Energy Corporation's (NYSE: CHK) operations are focused on discovering and developing its large and geographically diverse resource base of unconventional oil and natural gas assets onshore in the United States. Chesapeake Energy reported a net loss of $308 million for the year ended Dec. 31, 2019. As of Dec. 31, 2019, the company had $16.19 billion in total assets, $2.39 billion in total current liabilities, $9.40 billion in total long-term liabilities, and $4.40 billion in total equity. Chesapeake Energy and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33233) on June 28, 2020, after reaching terms of a Chapter 11 plan of reorganization to eliminate approximately $7 billion of debt. The Debtors tapped Kirkland & Ellis LLP as legal counsel; Alvarez & Marsal as restructuring advisor; Rothschild & Co and Intrepid Financial Partners as financial advisors; and Reevemark as communications advisor. Epiq Global is the claims agent, maintaining the page http://www.chk.com/restructuring-information. Wachtell, Lipton, Rosen & Katz serves as legal counsel to Chesapeake Energy's Board of Directors. MUFG Union Bank, N.A., the DIP facility agent and exit facilities agent, has tapped Sidley Austin LLP as legal counsel; RPA Advisors, LLC, as financial advisor; and Houlihan Lokey Capital, Inc., as investment banker. Davis Polk & Wardell LLP and Vinson & Elkins L.L.P. serve as legal counsel to an ad hoc group of first lien last out term loan lenders while Perella Weinberg Partners and Tudor, Pickering, Holt & Co. serve as the group's investment bankers. Franklin Advisers, Inc., has tapped Akin Gump Strauss Hauer & Feld LLP as legal counsel; FTI Consulting, Inc., as financial advisor; and Moelis & Company LLC as investment banker. CHIEF OILFIELD: Taps Patterson Earnhart as Litigation Counsel ------------------------------------------------------------- Chief Oilfield Services, LLC seeks approval from the U.S. Bankruptcy Court for the District of North Dakota to hire Patterson Earnhart Real Bird & Wilson LLP as its special litigation counsel. The firm will assist the Debtor in appeal and any other litigation matters that arise outside of the bankruptcy case. Patterson Earnhart's current hourly rates for matters relating to the Chapter 11 case range as follows: $300 per hour for partners, $200 per hour for associates, $100 per hour for law clerks. Jeffrey Rasmussen, Esq., a partner at the firm, disclosed in court filings that the firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Jeffrey S. Rasmussen, Esq. Patterson Earnhart Real Bird & Wilson LLP 601 Pennsylvania Ave., NW South Building, Suite 900 Washington, DC 20004 Telephone: (202) 434-8903 Facsimile: (202) 639-8238 About Chief Oilfield Services Chief Oilfield Services, LLC is a Dickinson, N.D.-based company that provides oil and gas field machinery and equipment. Chief Oilfield Services filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D.N.D. Case No. 20-30444) on Aug. 17, 2020. Leon Keator, vice president of operations, signed the petition. At the time of the filing, Debtor disclosed estimated assets of $100,000 and $500,000 and estimated liabilities of $1 million and $10 million. Judge Shon Hastings oversees the case. Fredrikson & Byron, P.A. serves as Debtor's legal counsel. CHOBANI LLC: Moody's Rates New Secured Bank Debt 'B1' ----------------------------------------------------- Moody's Investors Service affirmed ratings of Chobani, LLC including its B1 secured debt ratings and Caa2 senior unsecured rating. Moody's also assigned B1 ratings to proposed secured bank debt instrument ratings, including a new $150 million revolving credit facility, and $500 million first lien term loan. Finally, Moody's has assigned a B3 Corporate Family Rating ("CFR") and B3-PD Probability of Default Rating to Chobani, LLC. These ratings are being moved from the parent company Chobani Global Holdings, LLC which will not be a borrower under the new facilities. The outlook is stable. The proposed $150 million senior secured revolving credit facility will have a tenor of 3.5 years and replace the existing $150 million senior secured revolving credit facility expiring April 2022. The proposed $500 million first lien term loan will have a tenor of 7 years and will be used to repay a portion of the $793 million outstanding under an existing first lien term loan due October 2023. The company plans to retire the remaining amount outstanding under the existing term loan through a subsequent issuance of secured notes. Moody's expects that the remaining amount outstanding under the existing loan will be refinanced through other secured debt. Moody's considers the proposed refinancing to be a credit positive because the company will extend its debt maturities without materially affecting its cash flow. However, the company's CFR remains at B3 because leverage is largely unchanged. Chobani's high financial leverage -- debt/EBITDA is currently about 7.9x -- is a key risk factor. Moody's expects that Chobani will be able to reduce debt/EBITDA to approaching 6.5x over the next 18 months, partly due to stronger earnings stemming from favorable retail demand related to the coronavirus pandemic. New Assignments: Issuer: Chobani, LLC Corporate Family Rating, Assigned B3 Probability of Default Rating, Assigned B3-PD Senior Secured 1st Lien Revolving Credit Facility, Assigned B1 (LGD3) Senior Secured 1st Lien Term Loan B, Assigned B1 (LGD3) Ratings Affirmed: Issuer: Chobani, LLC GTD Senior Secured 1st Lien Revolving Credit Facility, Affirmed B1 (LGD2) GTD Senior Secured 1st Lien Term Loan B, Affirmed B1 (LGD2) GTD Senior Unsecured Notes, Affirmed Caa2 (LGD5) Ratings Withdrawn: Issuer: Chobani Global Holdings, LLC Corporate Family Rating, Withdrawn, previously rated B3 Probability of Default Rating, Withdrawn, previously rated B3-PD Outlook Actions: Issuer: Chobani Global Holdings, LLC Outlook, Withdrawn, previously Stable Issuer: Chobani, LLC Outlook, Remains Stable RATINGS RATIONALE Chobani's B3 Corporate Family Rating reflects its high financial leverage, significant exposure to milk input price volatility, and high concentration in the U.S. Greek yogurt category, which until recently, has experienced volume declines and increasing competitive activity. While category sales have increased in recent months due to the pandemic, Moody's believes that the longer-term prospects for category growth remain weak. The ratings also reflect high execution risk in Chobani's rapid product development strategy, which is a key component of its plan for earnings growth, margin expansion and financial deleveraging. Corporate governance remains a key credit negative, reflecting the concentrated control of the board of directors and key senior executive roles held by the founder and CEO. Chobani's credit profile is supported by good profit margins and the strong equity value of the Chobani brand that holds a leading position in the $3 billion U.S. Greek yogurt category. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The stable outlook reflects Moody's expectation that Chobani will make progress in reducing financial leverage through earnings growth while maintaining adequate liquidity, including positive free cash flow, over the next 12-18 months. The proposed $150 million revolving credit facility is expected to remain undrawn over this time. Chobani's ratings could be downgraded if debt/EBITDA is sustained above 8.0x, free cash flow remains negative, or if liquidity otherwise deteriorates. Ratings could be upgraded if Chobani successfully grows earnings, is able to sustain debt/EBITDA below 7.0x beyond the current demand surge and is likely to generate sustained positive free cash flow. The principal methodology used in these ratings was Consumer Packaged Goods Methodology published in February 2020. Chobani Global Holdings, LLC, based in Norwich, New York, is a leading manufacturer of Greek and traditional yogurt sold under the "Chobani" master brand. Annual sales approximate $1.4 billion. The company is majority owned by its CEO and founder Hamdi Ulukaya. CLEVELAND BIOLABS: Signs Consulting Contract with CSO ----------------------------------------------------- Cleveland BioLabs, Inc. entered into a consulting agreement with Dr. Andrei Gudkov, Ph.D., D. Sci., the Company's chief scientific officer. The Consulting Agreement replaces Dr. Gudkov's previous employment agreement, which expired in accordance with its terms in July 2020. Under the Consulting Agreement, Dr. Gudkov will continue to serve the Company as chief scientific officer as an independent contractor, and not an employee, for the term of six months, unless extended by mutual agreement of the Company and Dr. Gudkov, or earlier terminated. The Company has agreed to pay Dr. Gudkov, through his consultancy, the rate of $225 per hour for his services, which will be focused on clinical development responsibilities associated with the development of the Company's principal drug candidate, entolimod, as a medical radiation countermeasure, and such other duties and responsibilities associated with his continued services as chief scientific officer. Both Dr. Gudkov and the Company may terminate the Consulting Agreement for convenience upon 14 days' prior written notice. Upon termination, the Company will pay all fees owed to Dr. Gudkov for services rendered prior to the termination date, but he will not be entitled to any severance or other post-termination payments. About Cleveland BioLabs Cleveland BioLabs, Inc. -- http://www.cbiolabs.com/-- is a biopharmaceutical company developing novel approaches to activate the immune system and address serious medical needs. The Company's proprietary platform of Toll-like immune receptor activators has applications in radiation mitigation and oncology. The Company's most advanced product candidate is entolimod, which is being developed as a medical radiation countermeasure for the prevention of death from acute radiation syndrome and other indications in radiation oncology. The Company was incorporated in Delaware in June 2003 and is headquartered in Buffalo, New York. Cleveland Biolabs recorded a net loss of $2.69 million for the year ended Dec. 31, 2019, compared to a net loss of $3.71 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $4.08 million in total assets, $787,335 in total liabilities, and $3.29 million in total stockholders' equity. Meaden & Moore, Ltd., in Cleveland, Ohio, the Company's auditor since 2005, issued a "going concern" qualification in its report dated April 14, 2020 citing that the Company continues to have negative cash flow from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. CNT HOLDINGS: S&P Assigns 'B' ICR; Outlook Negative --------------------------------------------------- S&P Global Ratings assigned its 'B' issuer credit rating to CNT Holdings I Corp., the parent company of 1-800 Contacts. At the same time, S&P assigned a 'B' issue-level rating and a '3' recovery rating to the company's proposed first-lien facilities and a 'CCC+' issue-level rating and a '6' recovery to the company's proposed second-lien term loan facility. "The negative outlook reflects the risk that we could lower the ratings if leverage does not improve to around 7x in 2021 as a result of better performance and the company committing to pay down debt with excess cash flow," S&P said. "The 'B' rating reflects our expectation for a material increase in leverage in 2020, with substantial deleveraging to about 7x in 2021, driven by EBITDA base expansion and voluntary debt pay down," S&P said. KKR's acquisition will lead to funded debt of around $1.27 billion, nearly double pre-transaction levels. This leads to S&P Global Ratings' adjusted leverage increasing to above 10x on a pro forma basis, from 7.4x as of June 30, 2020. However, S&P forecasts leverage will rapidly decline as a result of better credit ratios. Driving this improvement is organic EBITDA expansion on higher sales as consumers shift their purchases online during the COVID-19 pandemic and expectations for lower legal expenses. S&P also expects the company to pay down debt with excess cash flows. CNT has benefited from its position as an online retailer during the pandemic, with accelerated revenue growth for 2020 before returning to a more normalized growth rate in 2021. Retail revenues, which the company generates entirely online, expanded 29% in the first half of the year. This is a sizable step from historic growth in the high-single to low-double-digit range. "In our view, the company has benefited as consumers sought online solutions for optical care and contact lens purchases as competitors' closed stores temporarily and consumers practiced social distancing. We believe the pandemic has provided a tailwind to an already consistent shift to online purchases," S&P said. As the pandemic continues to affect the lives of American consumers, S&P anticipates they will continue to seek alternatives to in-store shopping, which includes in-person interaction for contact lens purchases. S&P believes CNT's solid growth will continue through the end of 2020, before returning to a more normalized level in 2021. However, S&P believes the pandemic has permanently increased the cohort of consumers that choose to shop online, a trend that will remain a tailwind for CNT. Furthermore, while significant uncertainty remains in the path of the pandemic through 2020 and into 2021, S&P views contact lens purchases as largely non-discretionary which should provide stability to CNT's results. However, execution risks related to rapid growth and expansion of new businesses amid potential effects from the pandemic lead us to believe the risk for performance volatility is high over the next 12 months. Historically onerous legal expenses will cease to hinder margins in 2021, which, combined with expectations for revenue growth, lead to a EBITDA base expansion and contribute to deleveraging. Over the past several years, ongoing legal costs related to an FTC complaint and an associated consumer class action have hindered CNT's profitability. The company has agreed to pay a $15 million settlement in 2020, and as a result should have no material legal expenses in 2021. These expenses ranged from $10 million to $30 million annually since 2017 and were included in S&P adjusted EBITDA, suppressing margins substantially near the 12% to 14% range. Going forward into 2021 and 2022, S&P forecasts margins will increase to the 16% to 17% range. S&P anticipates the company will continue to invest heavily in advertising and its new businesses (including 6over6 and Liingo), expenses that over time should leverage off expanding sales. As a result, S&P is revising its business risk profile score to fair from weak. Expectations for continued fast revenue growth and EBITDA margin expansion leads to better free operating cash flow (FOCF) forecast. "We now expect FOCF of $75 million to $100 million annually, which compares favorably with other similarly rated peers, partially because CNT has relatively low levels of capital spend as an online retailer. We expect the company will use nearly all excess cash to pay down debt, which is a key factor in it meeting our outlined deleveraging path to 7x in 2021 and below 6x in 2022," S&P said. CNT has a good niche in the optical retail sector, but remains small in its addressable market. CNT has a solid position within the optical retail sector as the largest online contacts retailer, capturing roughly 50% of online contact sales and 11% of the U.S. contact lens market. However, independents capture a significant portion of the market, and in the broader optical retail market there are competitors with more substantial scale, including Luxottica. CNT has robust marketing campaigns, extensive selection of inventory with a high in-stock rate, and high levels of repeat orders that differentiate it from peers. Nonetheless, S&P views competition as intense, and believes CNT's position could be threatened to the extent other companies enter its market or existing players step up their marketing efforts. S&P views contact lenses as nondiscretionary, so they should hold up well in an economic slowdown. The negative outlook reflects the risk that credit metrics may take longer than anticipated to improve from high post-transaction levels. S&P expects debt to EBITDA to be around 7x in 2021 as EBITDA expands and the company uses excess cash flows to pay down debt. "We could lower the rating if we expect debt to EBITDA will remain higher than 7x on a sustained basis. This could occur if revenues do not grow in line with our expectation and margins are weaker than anticipated, or if the company does not utilize excess cash to pay down debt," S&P said. "We could revise the outlook to stable if we believe leverage will decline to around 7x in 2021, with expectations for further deleveraging on good free operating cash flow generation and EBITDA expansion," the rating agency said. COMCAR INDUSTRIES: Joey Martin 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 Joey Martin Auctioneers for $2,950, 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 for $2,950, 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/y25wv3n8 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. 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: K&K Truck Buying Low Value Assets for $7K ------------------------------------------------------------ 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 K&K Truck Parts for $7,000, 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 for $7,000, 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 & Co., Inc., at https://www.donlinrecano.com/Comcar. A copy of the Exhibit A is available at https://tinyurl.com/y4xhulvy 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. 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: Southeast Buying 4 Dry Cement Tankers for $13.8K ------------------------------------------------------------------- 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 four 2006 TRLKG APB 1000 dry cement tankers, as set forth in the Bill of Sale (Exhibit A), to Southeast Trailer Mart for $13,800, 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 Dry Cement Tankers to the Purchaser. The total selling price for the Sale to the Purchaser is for $13,800, 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/yygwpkll 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. 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: TAC Auction Buying Reefer Trailer for $6K ------------------------------------------------------------ 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 a 2010 Utility reefer trailer, Unit No. F220421, as set forth in the Bill of Sale (Exhibit A), to TAC Auction Services for $6,000, 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 Reefer Trailer to the Purchaser. The total selling price for the Sale to the Purchaser is for $6,000, 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 & Co., Inc., at https://www.donlinrecano.com/Comcar. A copy of the Exhibit A is available at https://tinyurl.com/yyvuknr4 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. 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. CONNECTING CULTURES: To File Exit Plan within Statutory Timeframe ----------------------------------------------------------------- Paul G. Swanson, Esq., at Steinhilber Swanson LLP, counsel to Connecting Cultures, Inc., advised the U.S. Bankruptcy Court for the Eastern District of Wisconsin the Debtor will file its Plan of Reorganization within the statutory timeframe and serve it on all creditors and interested parties. "The Debtor has, since the filing of the bankruptcy, repaired relationships with various customers of its medical translation services," Swanson said. "The precipitating event which caused the filing was the levy by the Internal Revenue Service of the various hospitals' and healthcare providers' accounts due the Debtor. Convincing these customers that it was alright to pay the Debtor direct was an effort. Additionally, adequate protection payments have begun to the IRS and the Debtor is analyzing its current and future revenue streams and business operations. "The Debtor believes that it will be able to, given its cash flows, propose what will be a consensual plan as the terms of repayment on priority taxes will be within the statutory limits and payments to unsecured claims should be 100% of allowed claim amounts over a reasonable period of time." Judge G. Michael Halfenger previously authorized Connecting Cultures to use cash collateral to pay prepetition compensation, pay and honor medical and other benefit programs, and to continue employee benefit programs on an interim basis. A final hearing on the motion was held September 29. Judge Halfenger has scheduled a Section 1188(a) Conference on October 26 at 1:30 p.m. by Telephone Hearing. The Court was advised by the parties that an agreement had been reached concerning the use of cash collateral and the provision of adequate protection as between the Debtor and the IRS. The IRS has an interest in the Debtor's cash collateral which consists of accounts receivable, office equipment, and other personal property of the Debtor of approximately $177,000. The Debtor is not aware of any other creditor who claims to have an interest in the Collateral. The Interim Cash Collateral Order provides that the IRS will be granted a post-petition security interest in post-petition generated accounts receivable to the extent of the use by the Debtor of prepetition accounts receivable in its post-petition operations. Additionally, by way of adequate protection, the Debtor will commence paying to the IRS the sum of $4,000 per month commencing October 1, 2020, and on the first day of each month hereafter until further Court Order. In his pe-conference report, Swanson said the Debtor does not believe that its assets need to be valued nor will there be any complicated pre-confirmation proceedings. The Debtor has reviewed the potential claims against it and has settled a certain dispute with a major unsecured creditor for an amount which was agreed as between the parties. "The Debtor's business is to provide translation services between physicians or other healthcare professionals and patients who do not speak English as a first language. The Debtor fell behind in certain payroll taxes as a result in lapse of prior management which lasted for a period of time. The Debtor's founder, Rashelle LeCaptain, has resumed the leadership roles which she had briefly removed herself from to raise a family. She has also obtained the services of the Chief Financial Officer who possesses substantial experience in managing the financial aspect of the business. The reorganization plan will simply repay all creditors over a reasonable period of time including the major secured creditor, the Internal Revenue Service," Swanson disclosed. About Connecting Cultures Connecting Cultures Inc. is a Wisconsin corporation that provides translation services to medical patients in Northeast Wisconsin. It specializes in translating Spanish, Hmong, and Somali to English. Connecting Cultures services medical providers in several counties in Northeast Wisconsin, including Prevea Medical Group, Managed Health Services of Wisconsin, Catalpa Health, Aurora Sports Medicine, ThedaCare, Baycare Physician Partners, Neurosciences Group, and Valley Eye Associates, among others. Connecting Cultures filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code (Bankr. E.D. Wis. Case No. 20-26091) on September 4, 2020, listing under $1 million in both assets and liabilities. Paul G. Swanson, Esq., at Steinhilber Swanson LLP is the counsel for the Debtor. CONTURA ENERGY: Incurs $238.3 Million Net Loss in Second Quarter ---------------------------------------------------------------- Contura Energy, Inc., filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q disclosing a net loss of $238.30 million on $411.84 million of total revenues for the three months ended June 30, 2020, compared to a net loss of $113.66 million on $656.21 million of total revenues for the three months ended June 30, 2019. For the six months ended June 30, 2020, the Company reported a net loss of $278.11 million on $882.30 million of total revenues compared to a net loss of $106.85 million on $1.26 billion of total revenues for the same period during the prior year. As of June 30, 2020, the Company had $2.04 billion in total assets, $1.63 billion in total liabilities, and $409.41 million in total stockholders' equity. At June 30, 2020, the Company had total liquidity of $240.2 million, including of cash and cash equivalents of $238.4 million, and $1.8 million of unused commitments available under the Amended and Restated Asset-Based Revolving Credit Agreement. Contura said, "Weak market conditions and depressed coal prices have resulted in operating losses in recent quarters. If market conditions do not improve, we expect to continue to experience operating losses and cash outflows in the coming quarters, which would adversely affect our liquidity. In particular, we expect a decrease in cash and cash equivalents to the extent that capital expenditures and other cash obligations, including our debt service obligations, exceed cash generated from our operations. "The COVID-19 pandemic has had negative impacts on our business, results of operations, financial condition and cash flows. A continued period of reduced demand for our products could have significant adverse consequences on our business. The full extent of the impact of the COVID-19 pandemic on our operational and financial performance will depend on various developments, including the duration and spread of the outbreak, its impact on our customers and suppliers and the range of governmental and community reactions to the pandemic, which are still uncertain and cannot be fully predicted at this time. "We have continued to take steps to enhance our capital structure and financial flexibility and reduce cash outflows from operations in the near term, including reductions in our operating, SG&A, and overhead costs, reductions in production volumes, and the amendment of our credit facility. We expect to engage in similar efforts in the future as opportunities arise through refinancing, repayment or repurchase of outstanding debt, amendment of our credit facilities, and other methods, and may consider the sale of other assets or businesses, and such other measures as circumstances warrant. We may decide to pursue or not pursue these opportunities at any time. Access to additional funds from liquidity-generating transactions or other sources of external financing is subject to market conditions and certain limitations, including our credit rating and covenant restrictions in our credit facility and indentures." A full-text copy of the Form 10-Q is available for free at: https://www.sec.gov/ix?doc=/Archives/edgar/data/1704715/000170471520000038/ctra-20200630.htm About Contura Energy Contura Energy (NYSE: CTRA) -- http://www.conturaenergy.com/-- is a Tennessee-based coal supplier with affiliate mining operations across major coal basins in Pennsylvania, Virginia and West Virginia. With customers across the globe, high-quality reserves and significant port capacity, Contura Energy reliably supplies both metallurgical coal to produce steel and thermal coal to generate power. Contura Energy reported a net loss of $316.32 million for the year ended Dec. 31, 2019. As of June 30, 2020, the Company had $2.04 billion in total assets, $1.63 billion in total liabilities, and $409.41 million in total stockholders' equity. * * * As reported by the TCR on June 5, 2020, S&P Global Ratings lowered its issuer credit rating on U.S.-based coal producer Contura Energy Inc. to 'CCC+' from 'B-'. S&P expects earnings to deteriorate due to continued weakness in coal markets further accelerated by the COVID-19 pandemic. In April 2020, Moody's Investors Service downgraded all long-term ratings for Contura Energy, Inc., including the Corporate Family Rating to Caa1 from B3. "Contura has idled the majority of its mines due to weak market conditions. Moody's expects that demand for metallurgical coal will weaken further in the near-term as blast furnace steel producers adjust to reduced demand due to the Coronavirus," said Ben Nelson, Moody's vice president -- senior credit officer and lead analyst for Contura Energy, Inc. "The rating action is entirely driven by macro-level concerns resulting from the global outbreak of Coronavirus." CONTURA ENERGY: Issues Statement on MG Capital Letter ----------------------------------------------------- Contura Energy, Inc. issued the following statement in response to the letter the Company's Board of Directors received from MG Capital Management, Ltd.: Contura welcomes the opportunity to engage with its shareholders and we welcome constructive input relating to enhancing shareholder value. We remain focused on delivering long-term shareholder value and will continue to take actions to achieve that objective. Although we would have preferred that MG Capital engage with Contura privately, we have reviewed and considered the MG Capital letter. MG Capital, the Board, and the executive management team are closely aligned in their goals and strategic direction for the Company; however, we believe that a number of the underlying assertions in the letter are inaccurate and we wish to clarify some of them. As coal industry investors are aware, the last year has been one of the most challenging years for U.S. coal producers due to a variety of factors, including weak global coal demand, low coal prices, and, of course, the COVID-19 pandemic. Contura's executive management, in concert with its Board, acted quickly to rationalize its production and cut costs to manage through these issues. The Board of Directors and the executive team share MG Capital's desire that Contura exit the thermal coal sector as efficiently as possible consistent with the best interests of the shareholders. The Company has already undertaken and announced various steps to achieve that goal. As previously announced, Contura is actively marketing the Cumberland mine for divestiture, which, if successful, will constitute a major element of the Company's planned exit from the thermal coal sector. The Board of Directors has fully supported the executive team in both the development of the Company's thermal exit strategy and in the steps that have already been taken to implement that strategy. Contura attempted to divest its Powder River Basin thermal coal properties through a transaction with Blackjewel L.L.C. in December 2017, prior to the merger between Contura and Alpha Natural Resources. Unfortunately, Blackjewel filed for Chapter 11 bankruptcy protection on July 1, 2019, before the transfer of certain mining permits to Blackjewel was completed. Because the transfer of the permits had not been completed, the contingent reclamation liability related to the permits remained an obligation of Contura. When this occurred, Contura was able to move quickly to relieve itself of all liabilities related to the former Wyoming operations with a transaction with Eagle Specialty Materials. This transaction was completed with the unanimous support of the Board of Directors. This concluded the Company's exit from its thermal-coal operations in the Powder River Basin and it no longer retains any contingent liability related to those operations. With respect to Board and executive management compensation, the Board has in fact reacted to the COVID-19 pandemic. In May 2020, each member of the executive management team voluntarily took a 5% reduction in salary. In the same month, the Board's compensation committee, which includes all of the "legacy directors," as defined in the MG Capital letter, unanimously determined that all of the Company's non-employee directors should join the Company's executive management in this effort by accepting a 5% reduction in their annual retainers. We have been advised by our compensation consultants that our Board compensation is well within the norms of our peers. Contura's executive management team believes that each of the Company's directors, including the "legacy directors," have provided value to the Company and its stockholders, and that executive management has the complete support of the Board, including with respect to the Company's focus on strategic initiatives, such as its transition to a pure-play metallurgical products provider, its focus on safe and productive operations, and its pursuit of aggressive cost control. Pursuant to our corporate governance guidelines, the Board routinely considers issues such as the size and composition of the Board of Directors to provide fresh perspectives and additional expertise consistent with our goals. Indeed, as the needs of the Company have evolved, the Board reduced the overall size of the Board by two, with four directors leaving, while adding two new directors -- Emily Medine and Scott Vogel -- since mid-2019. The Board welcomes input from the Company's stockholders, including MG Capital, regarding size and composition of the Board. About Contura Energy Contura Energy (NYSE: CTRA) -- http://www.conturaenergy.com-- is a Tennessee-based coal supplier with affiliate mining operations across major coal basins in Pennsylvania, Virginia and West Virginia. With customers across the globe, high-quality reserves and significant port capacity, Contura Energy reliably supplies both metallurgical coal to produce steel and thermal coal to generate power. Contura Energy reported a net loss of $316.32 million for the year ended Dec. 31, 2019. As of June 30, 2020, the Company had $2.04 billion in total assets, $1.63 billion in total liabilities, and $409.41 million in total stockholders' equity. * * * As reported by the TCR on June 5, 2020, S&P Global Ratings lowered its issuer credit rating on U.S.-based coal producer Contura Energy Inc. to 'CCC+' from 'B-'. S&P expects earnings to deteriorate due to continued weakness in coal markets further accelerated by the COVID-19 pandemic. In April 2020, Moody's Investors Service downgraded all long-term ratings for Contura Energy, Inc., including the Corporate Family Rating to Caa1 from B3. "Contura has idled the majority of its mines due to weak market conditions. Moody's expects that demand for metallurgical coal will weaken further in the near-term as blast furnace steel producers adjust to reduced demand due to the Coronavirus," said Ben Nelson, Moody's vice president -- senior credit officer and lead analyst for Contura Energy, Inc. "The rating action is entirely driven by macro-level concerns resulting from the global outbreak of Coronavirus." COVIA HOLDINGS: Committee Says Disclosures Inadequate ----------------------------------------------------- The Official Committee of Unsecured Creditors (the "Committee") of Covia Holdings Corporation, et al., submitted an objection to the Covia Holdings Corporation, et al.'s motion for entry of an order (I) Approving the adequacy of the Disclosure Statement, and (II) Granting related relief. The Committee pointed out that: * The court should not approve the Disclosure Statement at this time, particularly in light of the standing motion. * The Amended Disclosure Statement does not contain adequate information. * Claims against Sibelco, former fairmount shareholders, the Covia board, and the lenders. * Failure to clearly Disclose Unsecured Creditor recoveries. Committee further points out that: * Additional material issues requiring adequate disclosure or modification. * The third party opt-out releases are not appropriate. * The Amended Plan contains numerous confirmation-related defects that will be challenged by the committee. * A Committee letter should be included in the solicitation materials. Counsel for the Official Committee of Unsecured Creditors of Covia Holdings Corporation, et al.: Michelle Pector MORGAN, LEWIS & BOCKIUS LLP 1000 Louisiana, Suite 4000 Houston, TX 77002 Telephone: +1.713.890.5000 Facsimile: +1.713.890.5001 michelle.pector@morganlewis.com - and - Kurt A. Mayr (admitted pro hac vice) One State Street Hartford, CT 06103-3178 Telephone: +1.860.240.2700 Facsimile: +1.860.240.2701 E-mail: kurt.mayr@morganlewis.com - and - Andrew J. Gallo (admitted pro hac vice) One Federal Street Boston, MA 02110-1726 Telephone: +1.617.341.7700 Facsimile: +1.617.341.7701 E-mail: andrew.gallo@morganlewis.com About Covia Holdings Corporation Covia Holdings Corporation and its affiliates -- http://www.coviacorp.com/-- provide diversified mineral-based and material solutions for the energy and industrial markets. They produce a specialized range of industrial materials for use in the glass, ceramics, coatings, foundry, polymers, construction, water filtration, sports and recreation, and oil and gas markets. Covia Holdings Corporation, based in Independence, Ohio, and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33295) on June 29, 2020. In its petition, Covia disclosed $2,504,740,814 in assets and $1,903,952,839 in liabilities. The petition was signed by Andrew D. Eich, executive vice president, chief financial officer, and treasurer. The Hon. Marvin Isgur presides over the case. The Debtors tapped KIRKLAND & ELLIS LLP, and KIRKLAND & ELLIS INTERNATIONAL LLP, as counsel; JACKSON WALKER L.L.P., as co-counsel; KOBRE & KIM LLP, as special litigation counsel; PJT PARTNERS LP, as investment banker; ALIXPARTNERS, LLP, as financial advisor; and PRIME CLERK LLC, as claims and noticing agent. COVIA HOLDINGS: Gets Court Nod to Seek Reorganization Plan Votes ---------------------------------------------------------------- Daniel Gill of Bloomberg Law reports that bankrupt Covia Holdings Corp. received court approval to seek creditor votes for a reorganization plan that would cut the frac sand producer's $1.6 billion debt nearly in half by giving senior lenders ownership of the company. It???s expected that the unsecured creditors committee will contest the plan on the grounds that it undervalues certain assets and provides too small a return, Covia said in the disclosure statement approved Tuesday, October 13, 2020, by Judge David R. Jones of the U.S. Bankruptcy Court for the Southern District of Texas. Eligible creditors will be able to vote in advance of a four-day mini-trial on plan. Covia Holdings Corporation Covia Holdings Corporation and its affiliates -- http://www.coviacorp.com/-- provide diversified mineral-based and material solutions for the energy and industrial markets. They produce a specialized range of industrial materials for use in the glass, ceramics, coatings, foundry, polymers, construction, water filtration, sports and recreation, and oil and gas markets. Covia Holdings Corporation, based in Independence, Ohio, and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33295) on June 29, 2020. In its petition, Covia disclosed $2,504,740,814 in assets and $1,903,952,839 in liabilities. The petition was signed by Andrew D. Eich, executive vice president, chief financial officer, and treasurer. The Hon. Marvin Isgur presides over the case. The Debtors tapped KIRKLAND & ELLIS LLP, and KIRKLAND & ELLIS INTERNATIONAL LLP, as counsel; JACKSON WALKER L.L.P., as co-counsel; KOBRE & KIM LLP, as special litigation counsel; PJT PARTNERS LP, as investment banker; ALIXPARTNERS, LLP, as financial advisor; and PRIME CLERK LLC, as claims and noticing agent. COVIA HOLDINGS: Unsecureds Will Recover 9% to 12% of Claims ----------------------------------------------------------- Covia Holdings Corporation, et al., submitted a Plan and a Disclosure Statement. The deadline to vote on the Plan is November 4, 2020, at 11:59 P.M. (Prevailing Central Time). The Plan is supported by the Debtors and certain parties in interest that have executed the Restructuring Support Agreement, including Holders of approximately 58.4 percent of Term Loan Claims. The Debtors urge Holders of Claims or Interests whose votes are being solicited to vote to accept the Plan. To address their burdensome balance sheet, in the period leading up to the Petition Date, the Debtors began to engage with the principals and advisors of an ad hoc group of Holders of Term Loan Claims (collectively, the "Senior Creditors") represented by Paul, Weiss, Rifkind, Wharton, & Garrison LLP, as counsel ("PW"), and Centerview Partners LLC, as financial advisor ("Centerview" and, together with the Senior Creditors and PW, the "Term Loan Group"). Following extensive discussions and negotiations between the Debtors and the Term Loan Group, on June 29, 2020, the Debtors and the Senior Creditors entered into the Restructuring Support Agreement, which was amended and restated on July 7, 2020. Although the Restructuring Support Agreement provided the framework for many of the key components of the Debtors' Plan, it did not resolve certain matters that remained open and subject to negotiation, including the distributable value associated with the Debtors' unencumbered assets. Accordingly, the Restructuring Support Agreement did not specify a treatment for General Unsecured Claims, other than to specify that the recovery on such Claims would be provided in the form of equity in the Reorganized Debtors. The material terms of the Plan and Restructuring Support Agreement are as follows: * Each Holder of a Claim against TechniSand that is an Allowed General Unsecured Claim, Term Loan Deficiency Claim, or Swap Agreements Deficiency Claim shall receive, in full and final satisfaction of such Allowed Claim, its Pro Rata share of the TechniSand Unsecured Claims Equity Pool. * Each Holder of a Claim against Cheyenne that is an Allowed General Unsecured Claim, Term Loan Deficiency Claim, or Swap Agreements Deficiency Claim shall receive, in full and final satisfaction of such Allowed Claim, its Pro Rata share of the Cheyenne Unsecured Claims Equity Pool. * The Plan incorporates a settlement between the Debtors and the Senior Creditors regarding the amount of the Debtors' unencumbered going concern distributable value and the form in which that value will be distributed (the "Unencumbered Value Settlement"). The Unencumbered Value Settlement takes into account certain disputed issues, including: (1) how the Debtors' estimated total enterprise value should be allocated among the Debtors and their non-Debtor foreign subsidiaries; and (2) whether certain of the Debtors' accounts receivable are subject to the security interests securing the Debtors' obligations under the Term Loan Credit Agreement. In addition, solely as part of the Unencumbered Value Settlement, the Senior Creditors have agreed that a change of control with respect to the Reorganized Debtors will not constitute an event of default or an acceleration event under the New Term Loan Documents. As described in greater detail below, the Debtors believe that the Unencumbered Value Settlement strikes a reasonable balance between divergent views and legal theories. Accordingly, the Unencumbered Value Settlement provides for reasonable recoveries to the Debtors' stakeholders???both secured and unsecured. Moreover, the recoveries to the Debtors' stakeholders under the Unencumbered Value Settlement significantly exceed those that the Debtors anticipate would be available in a liquidation, satisfying the "floor" established by section 1129(a)(7) of the Bankruptcy Code. Finally, the component parts of the Unencumbered Value Settlement constitute an interconnected, integrated, and indivisible compromise and are not severable from one another. A more detailed discussion of the Unencumbered Value Settlement is provided in Article II.E of this Disclosure Statement. Value Allocation To guide them in developing the Plan, the Debtors, with the assistance of their advisors, created a "natural recovery model" (the "Recovery Model"). As described below, this Recovery Model allocates the Debtors' going concern distributable value across each of the Company's geographic segments (U.S., Canada, Mexico, China, and Denmark). It also allows for the Debtors to analyze the effect of modifying certain assumptions regarding the key drivers of unencumbered value to account for parties' divergent views and legal theories. It then calculates creditor recoveries on a waterfall basis based on the underlying assumptions and in accordance with the priority of each creditor's respective Claims. 1. Estimation of Total Distributable Value For purposes of the Recovery Model, the Debtors estimated the total distributable value at $1.193 billion. This estimate comprises two components: (1) the estimated total enterprise value of the Company as described in the valuation analysis attached as Exhibit G hereto (the "Valuation Analysis"); and (2) the Company's projected excess balance sheet cash as of December 31, 2020 (excluded from the Debtors' estimated total enterprise value) prior to the excess cash sweep in respect of the New Term Loan. The estimated value of each component is summarized as follows: Component Component --------- --------- Debtors' Total Enterprise Value $1,025 Distributable Excess Cash $168 Total Distributable Value $1,193 The Debtors' total distributable value estimate does not assign any value to potential claims or causes of action related to the UFS Merger, as the Debtors do not believe there are any colorable claims related to the UFS Merger and the Plan releases any such claims. See Article VI.E of this Disclosure Statement, entitled "Appointment of Independent Directors and Investigation of Potential Causes of Action Related to the UFS Merger" for further discussion of these matters. 2. Potential Sources of Unencumbered Value For purposes of calculating creditor recoveries under the Recovery Model, the Debtors, with the assistance of their advisors, undertook a thorough, rigorous analysis of potential unencumbered distributable value, including taking into account various legal theories that parties could assert and engaging in discussions with the Committee's advisors. In undertaking this analysis, the Debtors used their selected total distributable value midpoint of $1.193 billion as described in Exhibit G hereto and evaluated the range of reasonable potential outcomes if the issues that are being settled pursuant to the Unencumbered Value Settlement were litigated to conclusion. Based on this analysis, the Debtors estimated that if litigated, the reasonable range of value of the collateral securing the Term Loan/Swap Claims (the "Term Loan Collateral") would likely fall between approximately $1.01 billion and $1.10 billion in the aggregate (the "Collateral Value Range") and the total unencumbered going concern distributable value would likely fall between approximately $93 million and $183 million (the "Unencumbered Value Range"). In an effort to strike a reasonable balance between parties' divergent views and legal theories, the Debtors engaged in arm's-length, good faith negotiations with the Term Loan Group regarding an appropriate settlement amount to ascribe to the unencumbered going concern distributable value. These negotiations resulted in the Unencumbered Value Settlement, which takes into account the Debtors' estimated Collateral Value Range and Unencumbered Value Range as well as the litigation risk associated with particular value allocation approaches. The Unencumbered Value Settlement's values with respect to the Term Loan Collateral and the total going concern unencumbered distributable value (as well as the reasonable low and high cases) are set forth in the following chart: Distributable Value ($ in millions) Value Type Low Case Unencumbered High Case (Illustrative) Value Settlement (Illustrative) -------------- ---------------- -------------- Collateral Value $1,100 $1,078 $1,010 Unencumbered Value $93 $115 $183 Certain key components and considerations regarding the Unencumbered Value Settlement's values for the Term Loan Collateral (the "Collateral Value") and the total unencumbered going concern distributable value (the "Unencumbered Value") are discussed in greater detail below. (a) No Distributable Value Assigned to Potential Causes of Action Related to the UFS Merger As noted above, the Debtors' total distributable value estimate does not assign any value to potential causes of action related to the UFS Merger, and the Plan releases any such claims. Accordingly, none of the Collateral Value or Unencumbered Value is assigned to such potential causes of action. (b) Allocation of Enterprise Value (i) Step 1: Allocation of Enterprise Value Among the Debtors and Their Non-Debtor Foreign Subsidiaries As noted above, one potential disputed issue that the Unencumbered Value Settlement takes into account is the appropriate allocation of the Company's estimated enterprise value among the Debtors and their non-Debtor foreign subsidiaries. This issue bears on the Debtors' unencumbered going concern distributable value because the Term Loan Credit Agreement Documents' security and collateral provisions distinguish between the equity interests of different Company entities, generally providing for a pledge of 65% of the Debtors' equity interests in the non-U.S. subsidiaries.8 Pursuant to the Unencumbered Value Settlement, the Debtors and the Senior Creditors have agreed to allocate the Company's estimated enterprise value across the Debtors and their non-Debtor foreign subsidiaries as follows: Enterprise Value Entities ($ in millions) %age -------- ----------------- ------- Debtors $689 67.3% Non-Debtor Mexican Subsidiaries $163 15.9% Non-Debtor Canadian Subsidiaries $147 14.3% Other Non-Debtor Foreign Subsidiaries $26 2.5% The Unencumbered Value Settlement allocation is based on the Debtors' thorough analysis of various allocation methods, the particular value allocations that these methods yield, and the litigation risks associated with each. Specifically, the Debtors believe that the Unencumbered Value Settlement allocation reflects an appropriately weighted allocation among the Debtors' "base case" allocation (the "Base Case") and potential alternative allocations. Based on the Debtors' analysis, summarized below, the Debtors believe that the Unencumbered Value Settlement allocation is within the range of reasonableness. Base Case The Base Case allocates the Company's estimated enterprise value across each of the Company's geographic segments (U.S., Canada, Mexico, China, and Denmark) based on each segment's average adjusted EBITDA contribution for the twelve-month periods ending on December 31, 2019, April 30, 2020, and June 30, 2020, resulting in the following allocation: Enterprise Value Entities ($ in millions) %age -------- ----------------- ------- Debtors $735 71.6% Non-Debtor Mexican Subsidiaries $141 13.8% Non-Debtor Canadian Subsidiaries $127 12.4% Other Non-Debtor Foreign Subsidiaries $22 2.2% The adjusted EBITDA figures used for enterprise value allocation in the Base Case incorporate adjustments to account for historic above-market railcar expenses, excess rail terminal expenses, and certain intercompany sales commissions, while the use of multiple reference periods controls for certain atypical historic macroeconomic conditions. The adjustment with respect to railcar and rail terminal expenses is based on the Debtors' rationalization of their railcar and rail terminal portfolio through the Chapter 11 Cases and the Plan. This rationalization will significantly reduce the Debtors' railcar and rail terminal expenses going forward, contributing between approximately $55 million and $80 million of additional EBITDA annually over the next several years (primarily associated with the U.S. Debtors). The adjustment with respect to intercompany sales commissions is based on the termination (or modification) of the corresponding intercompany arrangements following the Effective Date. Alternative Allocation Methods The Unencumbered Value Settlement allocation also takes into account potential alternative methods of allocating the Company's estimated enterprise value among the Debtors and their non-Debtor foreign subsidiaries that the Committee (and other parties in interest) may advocate. For example, the Committee has expressed to the Debtors that it believes an appropriate allocation of value between the Debtors and their non-Debtor foreign subsidiaries is closer to a 50%-50% split. The Debtors do not believe that the allocations that such alternative methods yield accurately reflect their operative reality on a historic or go-forward basis. Accordingly, the Debtors believe that if the Committee (or other parties in interest) were to advocate adoption of such an allocation in a litigation scenario, they likely would not prevail on the merits. Based on the foregoing, the Debtors believe that the Unencumbered Value Settlement allocation is within the range of reasonableness. Allocation of Value of Certain Accounts Receivable The Unencumbered Value Settlement also addresses the extent to which certain of the Debtors' accounts receivable are subject to the security interests securing the Debtors' obligations under the Term Loan Credit Agreement (such security interests, the "Term Loan Liens"). Pursuant to the orders entered at Docket Nos. 86 and 405, on July 1, 2020, the Debtors terminated their prepetition receivables financing facility (the "Receivables Financing Facility") and transferred the outstanding letters of credit thereunder to a new letter of credit arrangement (the "L/C Facility"). In connection with the termination of the Receivables Financing Facility, and as a key feature of the termination transaction (i) Covia transferred approximately $39.5 million of the Term Loan/Swap Claimants' Term Loan Cash Collateral to an account maintained by non-Debtor Covia Financing LLC ("Covia Financing"), a bankruptcy-remote special purpose vehicle, to repay all amounts owed the Receivables Financing Facility and to cash collateralize the letters of credit transferred to the L/C Facility; and (ii) Covia Financing transferred back to Covia accounts receivable totaling approximately $85.6 million in aggregate face amount (the "Returned Receivables"). Allocation of Distributable Cash The Debtors' Recovery Model allocates substantially all distributable cash ("Distributable Cash") to Collateral Value, as the Debtors believe that substantially all of their cash constitutes Term Loan Collateral.17 The Bank Accounts18 used in the Debtors' cash management system are subject to the Term Loan Liens. None of the Bank Accounts, however, are (or were) subject to a deposit account control agreement in favor of the Term Loan/Swap Claimants or the Term Loan Agent or held at an institution of any Term Loan/Swap Claimants or the Term Loan Agent. SUMMARY OF EXPECTED RECOVERIES Class 2 Other Secured Claims. The projected amount of claims is $13.6 million. Class 3 Other Priority Claims. The projected amount of claims is $1.5 million. Class 4 Secured Term/Swap Claims. The projected amount of claims is $1,614 million and will recover 66% of claims. Class 5A Parent General Unsecured & Deficiency Claims. The projected amount of claims is $782 million - $857 million and will recover 9-12% of claims. Class 5B TechniSand General Unsecured & Deficiency Claims. The projected amount of claims is $633 million -$1,726 million and will recover 1% of claims. Class 5C Cheyenne General Unsecured & Deficiency Claims. The projected amount of claims is $518 million - $1,610 million. Each Holder of a Claim against TechniSand that is an Allowed General Unsecured Claim, Term Loan Deficiency Claim, or Swap Agreements Deficiency Claim will receive, in full and final satisfaction of such Allowed Claim, its Pro Rata share of the Cheyenne Unsecured Claims Equity Pool. Class 5D Other General Unsecured & Deficiency Claims. The projected amount of claims is $195 million - $208 million. All Other General Unsecured & Deficiency Claims shall be discharged, cancelled, released, and extinguished as of the Effective Date, and will be of no further force or effect, and Holders of Allowed Other General Unsecured & Deficiency Claims will not receive any distribution on account of such Allowed Other General Unsecured & Deficiency Claims. A full-text copy of the Disclosure Statement dated September 26, 2020, is available at https://tinyurl.com/y3bots45 from PacerMonitor.com at no charge. Co-Counsel to the Debtors: Matthew D. Cavenaugh Vienna F. Anaya Genevieve M. Graham Victoria N. Argeroplos JACKSON WALKER L.L.P. 1401 McKinney Street, Suite 1900 Houston, Texas 77010 Telephone: (713) 752 -4200 Facsimile: (713) 752-4221 Email: mcavenaugh@jw.com vanaya@jw.com ggraham@jw.com vargeroplos@jw.com Jonathan S. Henes, P.C. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 Email: jonathan.henes@kirkland.com - and - Benjamin M. Rhode Scott J. Vail 300 North LaSalle Street Chicago, Illinois 60654 Telephone: (312) 862-2000 Facsimile: (312) 862-2200 Email: benjamin.rhode@kirkland.com scott.vail@kirkland.com About Covia Holdings Corporation Covia Holdings Corporation and its affiliates -- http://www.coviacorp.com/-- provide diversified mineral-based and material solutions for the energy and industrial markets. They produce a specialized range of industrial materials for use in the glass, ceramics, coatings, foundry, polymers, construction, water filtration, sports and recreation, and oil and gas markets. Covia Holdings Corporation, based in Independence, Ohio, and its affiliates sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-33295) on June 29, 2020. In its petition, Covia disclosed $2,504,740,814 in assets and $1,903,952,839 in liabilities. The petition was signed by Andrew D. Eich, executive vice president, chief financial officer, and treasurer. The Hon. Marvin Isgur presides over the case. The Debtors tapped KIRKLAND & ELLIS LLP, and KIRKLAND & ELLIS INTERNATIONAL LLP, as counsel; JACKSON WALKER L.L.P., as co-counsel; KOBRE & KIM LLP, as special litigation counsel; PJT PARTNERS LP, as investment banker; ALIXPARTNERS, LLP, as financial advisor; and PRIME CLERK LLC, as claims and noticing agent. CRACKED EGG: Broke Covid Rules, Now in Chapter 11 ------------------------------------------------- Paula Reed of Trib Live reports that the Brentwood restaurant, Crack'd Egg, which made news last September 2020 for continuing to operate despite a health department order requiring it to close, has filed for Chapter 11 bankruptcy. The process will allow the Crack'd Egg to reorganize its debt while continuing to operate. According to the voluntary petition filed Friday, October 9, 2020, in U.S. Bankruptcy Court in Pittsburgh, the Crack'd Egg, owned by Kimberly Waigand, has just under $445,000 in unsecured debt. Attorney Sy O. Lampl said that the Brownsville Road restaurant, which opened five years ago, has been struggling following the March shutdown orders by Gov. Tom Wolf in response to the covid-19 pandemic. The Crack'd Egg has seen a significant decrease in revenue, Lampl said. Even with restaurants allowed to operate at 50% capacity, he said, the Crack'd Egg's location is very small. "This was a necessary move to preserve the financial enterprise of the Crack'd Egg," Lampl continued. "This is their lives. They've put everything into this." Of the money owed, $350,000 comes from a loan to the business made by Kimberly's husband, Donald Waigand, Lampl said. That loan came from proceeds from a personal injury case, he said. "They took their whole life savings and put it into this. They wanted to reinvest in their community." Typically, Lampl said, a Chapter 11 case concludes within a year. The restaurant's reorganization plan is due on April 7, 2020. The Crack'd Egg was ordered by the Allegheny County Health Department to close on Aug. 11, 2020 after inspectors found that the restaurant was failing to follow state orders to require employees and patrons to wear masks inside and for failing to adhere to occupancy limits and enforce social distancing. However, the restaurant continued to operate ??? and Kimberly Waigand spoke at a Harrisburg rally in which she encouraged others to do the same. On Sept. 16, the health department filed a complaint and emergency motion for a preliminary injunction against the restaurant in state court. A week later, the Crack'd Egg filed a federal lawsuit against Allegheny County and the health department alleging civil rights violations and claiming that the orders forcing it to close were illegal. All of those matters will now be automatically stayed pending the bankruptcy case, Lampl said, and the restaurant continues to operate. About Crack'd Egg Crack'd Egg is family owned and operated culinary driven gourmet eatery in Brentwood that serves breakfast and lunch. The Cracked Egg LLC filed a Chapter 11 petition (Bankr. W.D. Pa. Case No. 20-22889) on Oct. 9, 2020. In the petition signed by Kimberly Waigand, the owner, the Company was estimated to have less than$50,000 in assets and $100,000 to $500,000 in liabilities as of the filing. The Debtor's counsel: Robert O Lampl Robert O Lampl Law Office Tel: 412-392-0330 E-mail: rol@lampllaw.com CYCLE HOUSE: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Lead Debtor: Cycle House LLC 8511 Melrose Avenue West Hollywood, CA 90069 Business Description: The Debtors own and operate luxury indoor cycling studios. Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court District of Delaware Five affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Cycle House LLC 20-12595 8511 Melrose Avenue West Hollywood, CA 90069 Cyc Holdings LLC 20-12594 700 8th Avenue New York, NY 10036 Cyc Fitness Partners LLC 20-12596 700 8th Avenue New York, NY 10036 Zengo Fitness LLC 20-12597 4866 Cordell Avenue Bethesda, MD 20814 Cycle House LA II LLC 20-12598 8511 Melrose Avenue West Hollywood, CA 90069 Debtors' Counsel: David M. Klauder, Esq. BIELLI & KLAUDER, LLC 1204 N. King Street Wilmington, DE 19801 Tel: 302-803-4600 Email: dklauder@bk-legal.com Cycle House's Estimated Assets: $100,000 to $500,000 Cycle House's Estimated Liabilities: $1 million to $10 million Cyc Holdings' Estimated Assets: $0 to $50,000 Cyc Holdings' Estimated Liabilities: $0 to $50,000 Cycle House LA II's Estimated Assets: $0 to $50,000 Cycle House LA II's Estimated Liabilities: $100,000 to $500,000 Cyc Fitness Partners' Estimated Assets: $1 million to $10 million Cyc Fitness Partners's Estimated Liabilities: $1 million to $10 million Zengo Fitness' Estimated Assets: $0 to $50,000 Zengo Fitness' Estimated Liabilities: $100,000 to $500,000 The petitions were signed by Marc Caputo, managing member. Copies of the petitions containing, among other items, lists of the Debtors' largest unsecured creditors are available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/N4EZX4Q/Cycle_House_LLC__debke-20-12595__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/NTVUMPA/Cyc_Holdings_LLC__debke-20-12594__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/QRC7SUQ/Cycle_House_LA_II_LLC__debke-20-12598__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/QA6AK6Y/Cyc_Fitness_Partners_LLC__debke-20-12596__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/QJX2YEY/Zengo_Fitness_LLC__debke-20-12597__0001.0.pdf?mcid=tGE4TAMA DEAN FOODS: Food Lion Tells Court It Needs More DFA Co-Op Docs -------------------------------------------------------------- Law360 reports that Food Lion has told a North Carolina federal court it needs additional documents from Dairy Farmers of America related to settlement negotiations with enforcers for its purchase of assets from bankrupt milk producer Dean Foods as the grocery retailer challenges part of the cooperative's acquisition. Food Lion filed an objection Oct. 13,2020, to a magistrate judge's order denying a bid to compel the discovery of documents from DFA concerning its negotiations with the U.S. Department of Justice over its $433 million deal with Dean Foods. The grocery chain and another dairy co-operative are challenging the acquisition of three processing facilities in the Carolinas. About Dairy Farmers of America Dairy Farmers of America, Inc., headquartered in Kansas City, Kansas, is the leading US national milk marketing cooperative. It is owned by and serves more than 13,000 dairy farmer members representing more than 7,500 dairy farms in 48 states. DFA reported revenue of approximately $16 billion for the twelve months ended December 31, 2019 and annual revenue pro forma for the Dean acquisition is approximately $20 billion. The cooperative markets about 30% of the total milk volume in the United States. About Dean Foods Southern Foods Group, LLC, d/b/a Dean Foods, is a food and beverage company and a processor and direct-to-store distributor of fresh fluid milk and other dairy and dairy case products in the United States. The Company and its 40+ affiliates filed for bankruptcy protection on Nov. 12, 2019 (Bankr. S.D. Tex. Lead Case No. 19-36313). The petitions were signed by Gary Rahlfs, senior vice president and chief financial officer. Dean Foods was estimated to have assets and liabilities of $1 billion to $10 billion as of the bankruptcy filing. Judge David Jones oversees the cases. David Polk & Wardell LLP serves as general bankruptcy counsel to the Debtors, and Norton Rose Fulbright US LLP serves as local counsel. Alvarez Marsal is financial advisor to the Debtors, Evercore Group LLC is investment banker, and Epiq Corporate Restructuring LLC is notice and claims agent. DEERLICK TRUCKING: Seeks to Hire Quinn Law Firm as Attorney ----------------------------------------------------------- Deerlick Trucking & Sales LLC seeks authority from the US Bankruptcy Court for the Western District of Pennsylvania to hire Quinn Law Firm as its attorney. Services Quinn Law Firm will render are: (a) advice the Debtor on its powers and duties under Chapter 11, including legal matters related to the operation of its business; (b) prepare amendments to Debtor's Schedule of Assets, Schedule of Liabilities and Statement of Financial Affairs; (c) prepare and confirm a Chapter 11 plan of reorganization; (d) provide other legal actions, as necessary, to avoid liens, object to claims, enforce the automatic stay, recover preferences and defend motions and/or complaints against the Debtor; (e) prepare and file applications, motions, reports, etc. on behalf of the Debtor, including but not limited to motions for sale as necessary and appropriate; and (f) perform other legal services for the Debtor as may be necessary and appropriate in connection with the case. Quinn is not holding retainer. Post-Petition fees and costs are subject to Bankruptcy Court approval. Quinn is disinterested as that term is defined in the Bankruptcy Code, according to court filings. The firm can be reached through: Michael P. Kruszewski, Esq. Michael S. Jan Janin, Esq. THE QUINN LAW FIRM 2222 West Grandview Boulevard Erie, PA 16506-4508 Telephone: 814-833-2222 Facsimile: 814-833-6753 E-Mail: mkruszewski@quinnfirm.com mjanjanin@quinnfirm.com About Deerlick Trucking & Sales LLC Deerlick Trucking & Sales LLC sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No. 20-10596) on Sep. 4, 2020, listing under $1 million in both assets and liabilities. Michael S. JanJanin, Esq. at QUINN, BUSECK, LEEMHUIS, TOOHEY, & KROTO, INC. represents the Debtor as counsel. DEWIT DAIRY: Seeks to Hire Angstman Johnson as Attorney ------------------------------------------------------- Dewit Dairy seeks authority from the US Bankruptcy Court for the District of Idaho to hire Angstman Johnson, PLLC, as its counsel. Dewit Dairy requires Angstman to: a. prepare and file of a petition, Schedules, Statement of Financial Affairs, and other related forms; b. attend at all meetings of creditors, hearings, pretrial conferences, and trials in the case or any litigation arising in connection with the case, whether in state or federal court; c. prepare, file, and presentation to the Bankruptcy Court of any pleadings requesting relief; d. prepare, file, and presentation to the court of a disclosure statement and plan of arrangement under Chapter 11 of the Bankruptcy Code; e. review of claims made by creditors or interested parties, prepare, and prosecution of any objections to claims as appropriate; f. prepare and presentation of a final accounting and motion for final decree closing the bankruptcy case; and g. perform all other legal services that may be necessary. Billing rates for attorneys at Angstman Johnson range between $195 and $350 per hour. Paralegal billing rates are $95 and $130 per hour. Matthew T. Christensen, Esq. at Angstman Johnson attests that he and his firm are disinterested persons as defined in 11 U.S.C. Sec. 101(14) and represent no interest adverse to the debtor in possession or bankruptcy estate. The firm can be reached at: Matthew T. Christensen, Esq. ANGSTMAN JOHNSON 199 N. Capitol Blvd, Ste 200 Boise, ID 83702 Phone: (208) 384-8588 Fax: (208) 853-0117 Email: mtc@angstman.com About Dewit Dairy Dewit Dairy operates a dairy farm in Wendell, Idaho. Dewit Dairy sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Idaho Case No. 20-40734) on Sep. 18, 2020. At the time of filing, the Debtor estimated $10,000,001 to $50 million in assets and $1,000,001 to $10 million in liabilities.Matthew Todd Christensen, Esq. at Angstman Johnson, PLLC, represents the Debtor as counsel. DIESEL REALTY: Taps Parker & Associates as Bankruptcy Counsel ------------------------------------------------------------- Diesel Realty, LLC and its affiliates seek approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Parker & Associates LLC as their bankruptcy counsel. The firm will render the following legal services: (i) advise the Debtors with respect to their rights and duties; (ii) prepare requisite schedules and statements of financial affairs; (iii) represent the Debtors at all hearings; (iv) prepare all legal papers and review all financial and other reports to be filed in the Chapter 11 proceedings; (v) review the nature and validity of any liens asserted against the Debtors' properties; (vi) review the claims against the Debtors, the treatment of such claims and the preparation of any objections to claims; (vii) perform all other legal services to the Debtors. The firm will seek compensation based upon its normal and usual hourly billing rates, and reimbursement of expenses incurred on behalf of the Debtors. The firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, according to a court filing. Parker & Associates can be reached through: Nina M. Parker, Esq. Marques C. Lipton, Esq. Parker & Lipton Parker & Associates LLC 10 Converse Place, Suite 201 Winchester, MA 01890 Telephone: (781) 729-0005 Email: nparker@parkerlipton.com mlipton@parkerlipton.com About Diesel Realty, LLC Diesel Realty, LLC is a privately held company whose principal assets are located at 115 Main Street Amesbury, Mass. On September 23, 2020 Diesel Realty and its affiliates filed voluntary Chapter 11 petitions (Bankr. D. Mass. Lead Case No. 20-40935). The petitions were signed by David M. Martin, manager. At the time of the filings, Diesel Realty had estimated assets of between $1 million and $10 million and liabilities of the same range. Judge Elizabeth D. Katz oversees the case. Debtors are represented by Parker & Lipton. DMM HOLDINGS: Taps Parker & Associates as Bankruptcy Counsel ------------------------------------------------------------ DMM Holdings, LLC and its affiliates seek approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Parker & Associates LLC as their bankruptcy counsel. The firm will render the following legal services: (i) advise the Debtors with respect to their rights and duties; (ii) prepare requisite schedules and statements of financial affairs; (iii) represent the Debtors at all hearings; (iv) prepare all legal papers and review all financial and other reports to be filed in the Chapter 11 proceedings; (v) review the nature and validity of any liens asserted against the Debtors' properties; (vi) review the claims against the Debtors, the treatment of such claims and the preparation of any objections to claims; (vii) perform all other legal services to the Debtors. The firm will seek compensation based upon its normal and usual hourly billing rates, and reimbursement of expenses incurred on behalf of the Debtors. The firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, according to a court filing. Parker & Associates can be reached through: Nina M. Parker, Esq. Marques C. Lipton, Esq. Parker & Lipton Parker & Associates LLC 10 Converse Place, Suite 201 Winchester, MA 01890 Telephone: (781) 729-0005 Email: nparker@parkerlipton.com mlipton@parkerlipton.com About DMM Holdings, LLC DMM Holdings, LLC classifies its business as single asset real estate (as defined in 11 U.S.C. Section 101(51B)). On September 23, 2020 DMM Holdings and its affiliates filed voluntary Chapter 11 petitions (Bankr. D. Mass. Lead Case No. 20-40935). The petitions were signed by David M. Martin, manager. At the time of the filings, DMM Holdings had estimated assets of between $500,000 and $1 million and liabilities of between $1 million and $10 million. Judge Elizabeth D. Katz oversees the case. Debtors are represented by Parker & Lipton. DN ENTERPRISES: Selling 2 Omaha Investment Properties for $96K -------------------------------------------------------------- DN Enterprises, Inc., asks the U.S. Bankruptcy Court for the District of Nebraska to authorize the sale of the following two investment properties located at: (i) 4104 N. 40th Avenue, Omaha, Nebraska to Lepco, LLC or successors and assigns for $44,000; and (ii) 4632 N. 36th Street, Omaha, Nebraska to Kezia Theophilus or successors and assigns for $52,000. As part of its overall reorganization plan, the Debtor intends to sell several its investment properties for the purpose of reducing its debts. To that end, Debtor sought and obtained the employment of Colleen Mason and P.J. Morgan Real Estate Group as the Debtor's Real Estate Broker in June of 2019. The Debtor proposes to sell its the Properties pursuant to the terms of the Purchase Agreements. It has conferred with its Real Estate Broker and submits that the Purchase Agreements represent fair market purchase prices for the Properties. The sale will be free and clear of all Interests. The Debtor can project that there will be closing costs, real estate commissions, and other administrative expense claims associated with the sales of the Properties and its bankruptcy case. At this time, and by the Motion, the Debtor asks approval and authority to deduct from the gross proceeds received by the estate at closing: (i) the Debtor's share of necessary closing costs; (ii) the Real Estate Broker's commission and fees pursuant to its listing agreement; and (iii) the sum of $5,000 for administrative expenses incurred or to be incurred by the estate. The balance of the proceeds received by the Debtor will be paid to First State Bank. At this time, the Debtor cannot reasonably determine the amount of taxable income Debtor may realize from the Sales. However, it is possible that it will incur taxable income as a result of the Sales. The Debtor obtained limited title reports on the Properties from DRI Title. Having exercised sound business judgment, the Debtor has determined and submits to the Court that the Sales of the Properties free and clear of all Interests is in the best interests of Debtor, the estate, and the creditors thereof. As such, the Sales should be approved free and clear of all Interests. In order to permit the Sales to proceed as expeditiously as possible and to avoid further degradation or loss of value to the Properties, the Debtor asks the Court to waive the 14-day stay provided in Rule 6004(h). A copy of the Agreements is available at https://tinyurl.com/y6ypjwz3 from PacerMonitor.com free of charge. About DN Enterprises Inc. DN Enterprises, Inc., owns and operates approximately 35 residential properties as rental investments. DN Enterprises sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Neb. Case No. 18-81526) on Oct. 20, 2018. At the time of the filing, the Debtor estimated assets of $1 million to $10 million and liabilities of $1 million to $10 million. The case is assigned to Judge Thomas L. Saladino. Dvorak Law Group, LLC, is the Debtor's counsel. DPW HOLDINGS: NYSE Accepts Plan to Regain Compliance ---------------------------------------------------- DPW Holdings, Inc., was notified by the NYSE American, LLC that the Company has been granted a listing extension until Jan. 24, 2022 on the basis of the plan recently submitted by the Company to regain compliance with the NYSE American Company Guide. Specifically, the Company has demonstrated how it intends to regain compliance with Sections 1003(a)(ii) and (iii) of the Listing Standards by having stockholders' equity be $6.0 million or more. The Company will be subject to periodic review by NYSE during the extension period. Failure to make progress consistent with the plan or to regain compliance with the continued Listing Standards by the end of the extension period could result in the Company being delisted from the NYSE. About DPW Holdings DPW Holdings, Inc. -- http://www.DPWHoldings.com/-- is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive technologies with a global impact. Through its wholly and majority-owned subsidiaries and strategic investments, the Company provides mission-critical products that support a diverse range of industries, including defense/aerospace, industrial, telecommunications, medical, and textiles. In addition, the Company owns a select portfolio of commercial hospitality properties and extends credit toselectentrepreneurial businesses through a licensed lending subsidiary. DPW's headquarters are located at 201 Shipyard Way, Suite E, Newport Beach, CA 92663. DPW Holdings recorded a net loss available to common stockholders of $32.93 million for the year ended Dec. 31, 2019, compared to a net loss available to common stockholders of $32.34 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $40.49 million in total assets, $37.46 million in total liabilities, and $3.03 million in total stockholders' equity. Ziv Haft., Certified Public Accountants (Isr.) BDO Member Firm, the Company's auditor since 2012, issued a "going concern" qualification in its report dated May 29, 2020 citing that the Company has a 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. EDWARD DAWSON: Juarez Buying Warden Property for $3K Cash --------------------------------------------------------- Edward A. Dawson and Marcia A. Meade ask the U.S. Bankruptcy Court for the Eastern District of Washington to authorize the sale of the real property legally described as Lots 1 and 2, Block 60, Grand Coulee Addition to Warden, according to plat thereof recorded in Volume 2 of Plats, Page(s) 101 and 102, records of Grant County, Washington, to Mr. Jose A. Juarez for $3,000 cash. The purchases will be "As Is." The Debtors further ask the Court for an order approving the sale free and clear of liens and interests, including, but not limited to, the following: Liens, Judgments and Warrants identified as numbers 6 through 11 on Exhibit 1. They further ask the Court that at closing, the following disbursements be made: 1. A 10% real estate commission will be paid to realtors Joyce DeLeon of Gary Mann Real Estate; and 2. General and delinquent real estate taxes shown on Exhibit 1. The Debtors further ask the Court for an order shortening the time period to object to their proposed sale and disbursement to a period equal to 12 days from the date of mailing the notice. A copy of the Exhibits is available at https://tinyurl.com/y6ap5wfb from PacerMonitor.com free of charge. Edward A. Dawson and Marcia A. Meade sought Chapter 11 protection (Bankr. E.D. Wash. Case No. 18-01857) on June 29, 2018. The Debtors tapped Dan ORourke, Esq., at Southwell & ORourke, as counsel. EFS COGEN: S&P Rates New Term Loan, Revolving Credit Facility 'BB-' ------------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' project finance issue rating and '2' recovery rating to EFS Cogen Holdings I LLC's (EFS Cogen) new $1.0 billion term loan B (TLB) and $100 million revolving credit facility (RCF). The rating replaces the preliminary 'BB-' project finance issue rating S&P assigned Sept. 8, to EFS Cogen's proposed debt issuance, which we affirmed Sept. 23, after the project upsized the TLB. EFS Cogen used the proceeds from the issuance to refinance existing debt, as well as for general corporate purposes, including a one-time dividend payment to its equity holders, and payment of transaction-related fees and expenses. S&P also withdrew its 'BB-' issue rating on the company's refinanced $1.05 billion TLB and $125 million RCF, which are being replaced by the new debt. The refinancing transaction results in incremental debt, but DSCRs remain strong through TLB maturity, and above S&P's downside trigger during asset life. EFS Cogen has raised $1.1 billion in financing to repay the existing senior secured TLB and RCF, as well as for general corporate purposes, including a one-time distribution to its owners. The issuance consists of a $1.0 billion senior secured TLB with a term of seven years; and a senior secured RCF with a capacity of $100 million, expiring in five years. Proceeds from the transaction will be used to repay existing debt ($839 million); as well as for general corporate purposes ($136 million), including the one-time dividend payment to its equity holders; and payment of transaction-related fees and expenses ($25 million). Although the transaction results in incremental debt of about $161 million, S&P notes that the maturity of the TLB will be pushed out by more than four years, the period during which the project will sweep cash, offsetting some of the impact from increased borrowing. S&P now forecasts a minimum DSCR of 1.31x and an average DSCR of 2.0x for EFS Cogen throughout its reliable asset life. S&P also notes that the new TLB structure will no longer require EFS Cogen to comply with a target debt balance requirement, which reduces S&P's expectation of cash sweeps relative to the previous TLB, increasing forecast debt at maturity (September 2027), and weakening the project life coverage ratio (PLCR) to 1.51x at that time. The PLCR, which is a measure of a project's refinancing risk, compares the present value of its future cash flows relative to forecast debt at the point of maturity, establishing the likelihood that the project will ultimately repay its debt. The analysis is particularly relevant for projects that have market-sensitive cash flows and are financed with structures that materially rely on cash sweeps for the repayment of debt. Based on S&P's assessment of the project's operating risk, a 'B+' cap would apply at a PLCR below 1.5x. S&P also notes, however, that the PLCR is sensitive to changes in the rating agency's assumptions of variables such as the discount rate, spark spreads, asset life, and capital spending; as well as the project's actual financial performance, which will determine cash sweeps and consequently the debt outstanding at TLB maturity. "The stable outlook reflects our view that EFS Cogen will continue to operate in line with historical performance and generate strong DSCRs for the rating level through TLB maturity, as well as in the 2x area over the next two years," S&P said. S&P also expects that the minimum DSCR will remain above 1.3x in the post-refinancing period (2027-2035), in which the rating agency assumes a fully amortizing debt structure. "We could lower the rating if declining market prices or persistent operating difficulties, such as low availability factors or heat rate degradation, lead to minimum DSCRs below 1.3x on a sustained basis and heightened refinancing risk," S&P said. "We could consider raising the rating if the NYISO Zone J capacity market improved considerably or spark spreads widened, resulting in the project sweeping more cash than expected and reaching DSCRs above 2.0x consistently throughout the remaining life of the asset," S&P said. EMERGENT CAPITAL: Case Summary & 2 Unsecured Creditors ------------------------------------------------------ Two affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Emergent Capital, Inc. 20-12602 FKA Imperial Holdings, Inc. FKA Imperial Holdings, LLC 1200 North Federal Highway Suite 200 Boca Raton, FL 33432 Red Reef Alternative Investments, LLC 20-12601 1200 North Federal Highway Suite 200 Boca Raton, FL 33432 Business Description: Emergent Capital, Inc. -- www.emergentcapital.com -- is a holding company that, through its subsidiaries, owns a 27.5% equity investment in White Eagle Asset Portfolio, LP, which entity holds a valuable portfolio of life settlement assets. Chapter 11 Petition Date: October 15, 2020 Court: United States Bankruptcy Court District of Delaware Debtors' Counsel: Richard M. Pachulski, Esq. Maxim B. Litvak, Esq. Colin R. Robinson, Esq. PACHULSKI STANG ZIEHL & JONES LLP 919 North Market Street, 17th Floor P.O. Box 8705 Wilmington, DE 19899-8705 ( Tel: (302) 652-4100 Fax: (302) 652-4400 E-mail: rpachulski@pszjlaw.com mlitvak@pszjlaw.com crobinson@pszjlaw.com Emergent Capital's Total Assets as of May 31, 2020: $175,122,000 Emergent Capital's Total Debts as of May 31, 2020: $115,856,000 Red Reef's Estimated Assets: $0 to $50,000 Red Reef's Estimated Liabilities: $0 to $50,000 The petitions were signed by Miriam Martinez, chief financial officer of Emergent Capital. Copies of the petitions are available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/VSPWELY/Emergent_Capital_Inc__debke-20-12602__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/VLVE5RQ/Red_Reef_Alternative_Investments__debke-20-12601__0001.0.pdf?mcid=tGE4TAMA List of Emergent Capital's Two Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Convertible Unsecured 5.00% Senior $67,836,966 Notes Trustee Unsecured plus any U.S. Bank National Convertible accrued and Association Notes Due unpaid Attn: Corporate Trust 2023 interest, One Federal Street, 10th Floor fees, costs Boston, MA 02110 and expenses and other amounts Foley & Lardner LLP Richard J. Bernard, Esq. 90 Park Avenue New York, New York 10016 Tel: 212.682.7474 Fax: 212.687.2329 Email: rbernard@foley.com 2. Phyllis & Allan Pohl, Litigation Unliquidated Kimberly Sheris c/o Jonathan B. Butler, Esq. Ciklin Lubitz 515 N. Flager Drive, 20th Flr. West Palm Beach FL 33401 Tel: (561) 832-5900 Fax: (561) 833-4209 E-mail: jbutler@CiklinLubitz.com EMPIRE GENERATING: Lenders' Appeal from Plan Ruling Underway ------------------------------------------------------------ Minority lenders and appellants ASSF IV AIV B Holdings III, L.P., AEIF Trade, LLC, and SPTIF Parent, LLC in the case captioned ASSF IV AIV B HOLDINGS III, L.P., et al., Appellants, v. EMPIRE GENERATING CO, LLC, et al., Appellees, Consolidated Action No. 19-cv-09146 (NSR) (S.D.N.Y.) took an appeal from the U.S. Bankruptcy Court for the Southern District of New York's orders granting the motions of Empire Generating Co, LLC, and certain of its affiliates to approve the sale of their assets and to confirm their proposed reorganization plan. Appellants filed notices of appeal with the District Court on Oct. 1, 2019, and Oct. 2, 2019, respectively. On Oct. 16, 2019, the Appellants filed a motion before the Bankruptcy Court to stay consummation of the Sale Order and Confirmation Order pending the resolution of their appeals. The Appellants filed additional motions to stay consummation of the Sale Order and Confirmation Order pending the resolution of their appeals and to expedite the briefing schedule on their appeals. Upon review, District Judge Nelson S. Roman held that since the parties have reported that consummation of the Sale Order and Confirmation Order occurred as of Nov. 4, 2019, and briefing of the appeal was completed as of Jan. 21, 2020, the Appellants' motions are rendered academic and are therefore denied as moot. The Appellants' bankruptcy appeal is deemed fully submitted and remains pending before the District Court. Judge Roman said that on Nov. 4, 2019, the Appellees filed a Notice of Occurrence of Effective Date of the Debtors' Modified Amended Joint Chapter 11 Plan in the Bankruptcy Court. The Notice indicated that, pursuant to the Confirmation Order, the Effective Date of the Debtors' restructuring plan occurred on Nov. 4, 2019, and that as a result, "Debtors have emerged from the chapter 11 proceeding as Reorganized Debtors." On Nov. 5, 2019, the Appellants filed additional supplemental motions reporting the foregoing development to the District Court and stating that expedited briefing of their appeals remained warranted. However, the District Court declined to set an expedited schedule and briefing was completed pursuant to the Federal Rules of Bankruptcy Procedure as of Jan. 21, 2020. A copy of the Court's Opinion and Order is available at https://bit.ly/3iTlWtW from Leagle.com. About Empire Generating Empire Generating Co LLC engages in the generation and sale of natural gas fired electricity in New York. It owns and operates a power plant in Rensselaer, New York. Empire Generating is ultimately owned by non-debtor TTK Power, LLC, which in turn is indirectly owned by three sponsors: Tyr TTK Power, LLC ("Tyr"), KPIC USA, LLC ("Kansai") and TG TTK Power, LLC. Empire Generating Co, LLC, Empire Gen Holdco, LLC, Empire Gen Holdings, LLC, and TTK Empire Power, LLC sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 19-23007) on May 19, 2019. Empire Generating estimated assets and liabilities of $100 million to $500 million as of the bankruptcy filing. The Hon. Robert D. Drain is the case judge. The Debtors tapped Hunton Andrews Kurth LLP and Steinhilber Swanson LLP as counsel; RPA Advisors as financial advisor and OMNI Management Group, Inc. as claims agent. EPICOR HOLDINGS: S&P Affirms 'B-' ICR on Pending Acquisition ------------------------------------------------------------ S&P Global Ratings affirmed its 'B-' issuer credit rating on Epicor Holdings Corp. and Epicor Software Corp. At the same time, S&P affirmed its 'B-' issue-level and '3' recovery ratings on the first-lien debt and also its 'CCC' issue-level and '6' recovery ratings on the company's existing second-lien debt. "The stable outlook on Epicor reflects our belief that, despite higher levels of adjusted debt, Epicor has good prospects to sustain leverage in the high-8x area over the next year," S&P said. In its base case, S&P is projecting continued growth in net new bookings, low- to mid-single-digit-percent organic revenue growth, relatively stable EBITDA margins (in the high-30% area) and free operating cash flow (FOCF) generation of about $115 million. Funds affiliated with Clayton, Dubilier & Rice are finalizing their agreement to acquire Epicor Holdings from its existing financial sponsor, Kohlberg Kravis Roberts & Co. Inc., for $4.7 billion. "The acquisition of Epicor by affiliates of CD&R is viewed as a financial transaction and does not alter our view of Epicor's competitive position and overall business risk," S&P said. S&P's assessment of Epicor's business continues to be underpinned by a good market position in the enterprise resource planning (ERP) software industry (the sixth-largest vendor, according to Gartner Inc.), the mission-critical nature of ERP systems, Epicor's strong and tenured relationships (historical renewal rates in the mid-90% area) with a diverse group, and its significant proportion of recurring revenue streams (cloud, maintenance, and services accounted for more than 70% of its total revenue as of June 30, 2020)." These factors are partly offset by the fragmented and competitive nature of the enterprise software solutions market and exposure to industry cyclicality. Epicor will operate with a substantial debt burden, and its weak credit measures will be further pressured by the inclusion of about $300 million of preferred equity in S&P's calculation of adjusted debt. S&P considers this preferred equity that CD&R will raise to partially fund the acquisition of Epicor as having minimal equity credit; the rating agency includes this obligation as debt in its adjusted calculation since it is held by a single investor, carries a high payment-in-kind (PIK) interest rate of 11.5%, and is callable by the company two years from the issuance date. S&P now estimates that for the 12 months ending Sept. 30, 2020, and pro forma for this preferred equity issuance, Epicor will have a pro forma adjusted debt balance of about $3 billion, compared to $2.7 billion, and a leverage ratio in the high-8x area, compared to low 8x." That said, since preferred equity agreement does not require mandatory cash interest or dividend payments, there should be no effect on the company's liquidity position, cash flow generation prospects, or its ability to comply with its financial covenants. "We think Epicor can sustain good operating performance over the next 12 months, which should keep adjusted leverage well below 10x over the next year," S&P said. For the nine months ended June 2020, Epicor's revenue increased by about 3.5% while its EBITDA rose by about $30 million. Although knock-on effects from COVID-19 remain a risk, S&P expects Epicor's growing proportion of recurring revenue alongside a year-over-year reduction in sales compensation expense and discretionary spending should enable it to modestly improve its EBITDA margins (to about 38%). In S&P's view, this level of EBITDA improvement, coupled with Epicor's mandatory term loan amortization payments of about $19 million annually, should partially offset higher preferred equity balances, due to the PIK interest feature, and support leverage of 9x or better over the next year. The potential for very aggressive financial policies stemming from its financial sponsor ownership also continues to be a risk. "The stable outlook on Epicor reflects our belief that, despite higher levels of adjusted debt, Epicor has good prospects to sustain leverage in the high-8x area over the next year," S&P said. In its base case, S&P projects continued growth in net new bookings, low-to mid-single-digit-percent organic revenue growth, relatively stable EBITDA margins (in the high-30% area) and FOCF generation of about $115 million. "We could lower our rating on Epicor if operating difficulties weaken its credit metrics toward the 10x area or its cash flow generation declines to negligible levels or turns negative with limited prospects for improvement. We believe this would likely occur if the company's software sales decline because of significant customer losses, increased competition from larger industry players, or technological shifts that reduce the usefulness of its products," S&P said. "Although unlikely given Epicor's very high levels of leverage and potential for very aggressive financial policies, we could raise our rating on Epicor if we believe it can reduce and sustain leverage of less than 7.5x. For this to occur, Epicor's operating performance would need to significantly exceed our current expectations and also make voluntarily debt repayments of at least $200 million of debt," the rating agency said. EPR PROPERTIES: S&P Lowers ICR to 'BB+' on Tenant Headwinds ----------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S. net-leased REIT EPR Properties ($6.2 billion in undepreciated real estate assets) to 'BB+' from 'BBB-'. S&P is lowering its issue-level rating on the company's senior unsecured notes and credit facilities to 'BB+' and assigning a '3' recovery rating. S&P is also lowering its issue-level rating on the company's preferred stock to 'B+' from 'BB'. "The negative outlook reflects our view that tenant distress from the COVID-19 pandemic and the recession could persist for a prolonged period, resulting in material tenant disruption, hurting EPR's tenant level rent coverage, and causing credit metrics to deteriorate beyond our thresholds for the current rating," S&P said. S&P expects the lingering impact from COVID-19 and social distancing to hurt EPR's business prospects and profitability. Given EPR's niche focus on experiential proprieties, actions taken to slow the spread of COVID-19 caused significant business disruption. The company collected just 24% of second-quarter contractual base rents and mortgage payments, with most properties closed for several months. While cash rent collection has since improved modestly, reaching 33% and 39% in July and August, respectively, rent collection remains among the lowest in the traditional REIT sector. S&P expects pandemic-related disruption to persist, impairing EPR's tenant-level rent coverage and leading to sustained deferrals for some tenants. At this time, S&P is uncertain if EPR's properties will return to pre-pandemic profitability, especially as tenant credit quality deteriorates. In particular, S&P is concerned about theaters, which comprised close to 50% of the company's pre-pandemic annualized revenue. While S&P had expected theater reopenings to be gradual and at reduced capacity, attendance was weaker than anticipated. Moreover, recent announcements by studios to push back film releases, as well as Regal's decision to temporarily suspend U.S. operations, indicates a longer road to recovery. As a result, until studios release more films and consumer demand picks up, S&P expects theaters to either remain closed (like Regal) or face a significant cash flow burn. "We therefore have doubts about tenants being able to pay current and future rents, even at a later date, despite restrictions easing throughout the third quarter in most geographies. Instead, we expect disruption from deferrals to last for a prolonged period, with many properties still operating at reduced capacity," S&P said. Most deferral agreements are structured such that rent collection ramps up through the end of 2020 (and in some cases in 2021) with collections extending beyond 2021. S&P thinks that some deferrals could eventually be written off to keep tenants or as additional tenants are placed on cash-based accounting/restructure leases as credit quality deteriorates. Furthermore, since EPR's nontraditional real estate assets depend on consumer discretionary income, S&P believes they could be under pressure from the recession, as well as continued wellness and safety concerns until a vaccine or effective treatment is widely available. In particular, S&P expects a sustained change in demand for experiential properties from certain demographics (especially those that are more vulnerable due to age or underlying health conditions) that continue to avoid nonessential activities over health concerns. S&P expects this could remain until individuals can safely partake in nonessential activities without elevating their risk of contracting the virus, such as when an effective vaccine is readily available, which the rating agency thinks could be around mid-2021. Headwinds facing theaters could lead to prolonged deferrals, write-offs, and/or additional lease restructurings. Movie cinemas have been among the hardest-hit property types amid the pandemic, with reopenings only recently beginning in certain markets while others (like New York City and Los Angeles) still remain under mandated government closures. S&P recently took a number of negative rating actions on theaters, including AMC ('CCC-/Negative'), Cineworld ('CCC-/Negative'), and Cinemark ('B+/Watch Neg') amid liquidity concerns and near-term pressure from weak theater attendance and delayed film releases. Due to continued health and safety concerns and social distancing orders, S&P expects theater attendance to remain challenged well into 2021, especially should there be another wave of coronavirus cases that lead to more lockdowns. This heightened risk of tenant default could prove challenging for EPR, given close to 50% of its pre-COVID revenue was derived from movie theater operators. That being said, EPR owns better-quality and more productive properties than the national average, with higher historical revenue relative to its theater market share. Moreover, the company proactively restructured its leases with AMC in the second quarter, which permanently lowered rent but also provided some downside protection in a bankruptcy scenario via a master lease agreement. S&P believes tenant distress could significantly affect EPR's credit metrics, especially if bankruptcies accelerate. It is concerned about the company's ability to tackle rent deferrals and tenant troubles for a prolonged period while maintaining credit protection measures in line with the current rating. S&P believes EPR's tenants--the vast majority of which are unrated or speculative grade--could face liquidity concerns from material declines in revenue, resulting in elevated bad debt expenses and write-offs over the next several months or more. This could result in additional declines in occupancy and operating cash flow, keeping debt to EBITDA above 7.5x without a path to deleverage. S&P thinks distress would be further prolonged if vacancies increase since EPR's special-purpose properties have weaker potential for profitable adaptive reuse, with re-tenanting expected to take longer than traditional commercial real estate. EPR currently has adequate liquidity to weather rent deferrals--including $1 billion of cash on hand--which includes its precautionary draw of $750 million on its revolving credit facility, with no debt maturing until 2022. The company also suspended its share repurchase program and common dividends as a stipulation for its credit amendment executed in the second quarter, which preserves additional cash flow. Provided rent collections continue to improve modestly, S&P thinks the company will generate sufficient cash flow to cover its operating costs. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety "The negative outlook reflects our belief that tenant distress from the COVID-19 pandemic could persist for a prolonged period, resulting in heightened bankruptcies and weakening tenant-level rent coverage, causing credit metrics to deteriorate beyond our thresholds for the rating," S&P said. "We view this as possible given current deferrals are expected to last beyond 2021 and because normalized cash collection will not resume until attendance at entertainment properties returns to somewhat historical levels," the rating agency said. S&P could lower its rating if the following occurs: -- Disruption from the recession and pandemic cause elevated write-offs and prolonged deferrals, such that debt to EBTIDA remains above 7.5x without a feasible path to deleverage over the next year; or -- Property closures and tenant distress persists for a prolonged period, materially weakening tenant-level rent coverage and resulting in material tenant bankruptcies. S&P could revise the outlook back to stable if: -- Cash rent collection improves materially, with most tenants open with limited risk of further lockdown measures that could lead to additional deferrals. -- There are minimal write-offs and lease restructurings, such that S&P anticipates the company's leverage will trend below 7.5x over the next year as EBITDA improves. -- S&P sees improvement in EPR's tenant credit quality, with occupancy levels and in-place rents expected to stay relatively steady. ESPORTS USA: Case Summary & 15 Unsecured Creditors -------------------------------------------------- Debtor: ESports USA Holdings, Inc. dba Valhalla ESports Lounge 710 B West Sixth Street Austin, TX 78701 Business Description: ESports USA Holdings, Inc. owns and operates Valhalla Esports Lounge, an esports bar and restaurant in Austin, Texas. Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court Western District of Texas Case No.: 20-11125 Judge: Hon. Tony M. Davis Debtor's Counsel: Stephen W. Sather, Esq. BARRON & NEWBURGER, P.C. 7320 N. MoPac Expwy., Suite 400 Austin, TX 78731 Tel: (512) 476-9103 E-mail: ssather@bn-lawyers.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Mahmood Z. Mumtaz, CFO. A copy of the petition containing, among other items, a list of the Debtor's 15 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/CR7BW5Q/ESports_USA_Holdings_Inc__txwbke-20-11125__0001.0.pdf?mcid=tGE4TAMA FARBER BALLET: Seeks Approval to Hire Accountant ------------------------------------------------ Farber Ballet, Inc. seeks approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire Marianna Lanzman, a certified public accountant practicing in New York. The accountant will provide the following services: a. oversee the internal accounting systems employed by the Debtor; b. prepare federal and state tax returns; c. prepare audited year-end financial statements; d. assist the Debtor in preparing a reorganization plan; e. assist the Debtor in preparing and reviewing financial projections; f. assist the Debtor in complying with the Operational Guidelines and Reporting Requirements promulgated by the Office of the U.S. Trustee; and g. provide such additional financial analysis, projections, and other accounting and tax services as may be required. The accountant will be paid as follows: $375 per hour during tax season; $260 per hour from May-December; and $ 80 per hour for staff. Ms. Lanzman disclosed in court filings that she is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Ms. Lanzman holds office at: Marianna A. Lanzman, CPA 2241 East 64th Street Brooklyn, NY 11234 Telephone: (718) 376-5111 About Farber Ballet Inc. Farber Ballet Inc., a ballet school in New York City, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 20-43010) on Aug. 20, 2020. At the time of the filing, Debtor had estimated assets of up to $50,000 and liabilities of between $100,001 and $500,000. Judge Nancy Hershey Lord oversees the case. David A. Feinerman, Esq. is Debtor's legal counsel. FERRELLGAS PARTNERS: Incurs $83 Million Net Loss in Fiscal 2020 --------------------------------------------------------------- Ferrellgas Partners, L.P., filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing a net loss of $83 million on $1.49 billion of total revenues for the year ended July 31, 2020, compared to a net loss of $64.54 million on $1.68 billion of total revenues for the year ended July 31, 2019. As of July 31, 2020, the Company had $1.66 billion in total assets, $1.09 billion in total current liabilities, $1.65 billion in long-term debt, $89.02 million in operating lease liabilities, $51.19 million in other liabilities, and a $1.21 billion total partners' deficit. Ferrellgas stated in a press release that, "Despite significant economic and operational uncertainties in the US, the Company produced exceptionally strong results through the end of fiscal 2020, leading to a $35.6 million increase in operating income, or 32% growth over the prior year and set a foundation for continued growth in fiscal 2021. Due to warmer winter weather and the slowdown in the economy, the gallons of propane sold for the year were 873.5 million, compared to 904.8 million last year. However, these decreases were partially offset by a continued increase in residential demand resulting from 3% retail customer growth as the Company continues to aggressively seek market share. Additionally, Blue Rhino sales locations increased over 8%. Margin per gallon for the year was 7.0??, or 9% higher than the prior year, attributable to strategic product placement, sound supply chain logistics strategies and lower wholesale propane prices. Overall, the increase in margin and increases in tank exchange volumes and customer growth were partially offset by decreased industrial and commercial sales volumes due to the slowdown of the economy. This has resulted in an increase in gross margin dollars of $36.4 million. Operating expenses increased due to the growth of new customers, but also included a $17.3 million reserve for bad debt related to Bridger, a non-core acquisition that has now been divested. Additionally, the $35.6 million growth in operating income was complimented by a $38.4 million, or 35.3%, decrease in capital expenditures as the Company focused on the utilization of existing assets and negotiated lower steel prices. "The Company has numerous initiatives underway to increase efficiency and profitability. These initiatives helped to produce strong results in the fourth quarter and enable continued high performance in the areas of growth and operational expense management. Strong execution by a leaner and more agile workforce of essential workers is driving high performance throughout the Company, both in the field and in corporate locations. Successful transition of essential workers from a corporate work-place to a technology centric work-from-home environment decreased various general and administrative expenses as well as travel expense throughout the Company. Lastly, our continued commitment to safely serving our over 700 thousand customers while adapting to the ever-changing circumstances and new operating protocols to help protect the health and safety of our customers and employees remains our top priority." For the quarter, the net loss attributable to Ferrellgas Partners, L.P. was $70.0 million, or $0.71 per common unit, compared to prior year's fourth quarter net loss of $71.0 million, or $0.72 per common unit. Adjusted EBITDA, a non-GAAP measure, increased by over $35 million, or 15%, compared to prior year. For the fourth quarter, Adjusted EBITDA was $26.7 million compared to $4.0 million in last year's quarter resulting from the previously discussed initiatives. As previously announced, the Company indefinitely suspended its quarterly cash distribution as a result of not meeting the required fixed charge coverage ratio contained in the senior unsecured notes due 2020. Additionally, as the Company continues to evaluate options to address its leverage, the Company does not intend to comment further on its progress in this regard or on potential options until further disclosure is appropriate or required by law. Going Concern Grant Thornton LLP, in Kansas City, Missouri, the Company's auditor since 2013, issued a "going concern" qualification in its report dated Oct. 15, 2020, citing that as of July 31, 2020, the Partnership has $357.0 million in unsecured notes due June 15, 2020, which the Partnership failed to repay, and $500.0 million in unsecured notes of its consolidated subsidiary, Ferellgas, L.P., due May 1, 2021, that are each classified as current in the consolidated financial statements and its current liabilities exceeded its current assets by $546.0 million and its total liabilities exceeded its total assets by $1,208.3 million. The Partnership's business plan contemplates restructuring or refinancing its long-term arrangements and reducing outstanding indebtedness. The Partnership's ability to achieve the foregoing elements of its business plan, which may be necessary to permit the realization of assets and satisfaction of liabilities in the ordinary course of business, is uncertain and raises substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/Archives/edgar/data/922358/000155837020011490/fgp-20200731x10k.htm About Ferrellgas Ferrellgas Partners, L.P. (www.ferrellgas.com), through its operating partnership, Ferrellgas, L.P., and subsidiaries, serves propane customers in all 50 states, the District of Columbia, and Puerto Rico. * * * As reported by the TCR on June 23, 2020, S&P Global Ratings lowered its issuer credit rating on Kansas-based propane distributor Ferrellgas Partners L.P. to 'SD' (selective default) from 'CC'. The downgrade reflects Ferrellgas Partners' decision not to make the final maturity payment on its senior unsecured notes due June 15 and its subsequent decision to enter into a forbearance agreement with the noteholders on June 7. FIELDWOOD ENERGY: Committee Taps Cole Schotz as Co-Counsel ---------------------------------------------------------- The official committee of unsecured creditors of Fieldwood Energy LLC and its affiliates seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to retain Cole Schotz P.C. as its co-counsel effective as of August 20, 2020. The Committee requires Cole Schotz to: i. advise the Committee with respect to its rights, duties, and powers in these Chapter 11 Cases; ii. assist and advise the Committee in its consultations with the Debtors relative to the administration of these Chapter 11 Cases; iii. assist the Committee in analyzing the claims of the Debtors' creditors and the Debtors' capital structure and in negotiating with holders of claims; iv. assist the Committee in its investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtors and of the operation of the Debtors' business; v. assist the Committee in its investigation of the liens and claims of the Debtors' lenders and the prosecution of any claims or causes of action revealed by such investigation; vi. assist the Committee in its analysis of, and negotiations with, the Debtors or any third-party concerning matters related to, among other things, the assumption or rejection of leases of nonresidential real property and executory contracts, asset dispositions, financing or other transactions, and the terms of one or more plans of reorganization for the Debtors and accompanying disclosure statements and related plan documents; vii. assist and advise the Committee in communicating with unsecured creditors regarding significant matters in these Chapter 11 Cases; viii. represent the Committee at hearings and other proceedings; ix. review and analyze applications, orders, statements of operations, and schedules filed with the Court and advise the Committee as to their propriety; x. assist the Committee in preparing pleadings and applications as may be necessary in furtherance of the Committee's interests and objectives; xi. prepare, on behalf of the Committee, any pleadings, including without limitation, motions, memoranda, complaints, adversary complaints, objections or comments in connection with any of the foregoing; xii. handle matters that are not appropriately handled by Stroock because of actual and potential conflict of interest issues; and xiii. perform such other legal services as may be required or requested or as may otherwise be deemed in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code, Bankruptcy Rules or other applicable law. Cole Schotz will be paid at these hourly rates: Members $435 - $1,050 Associates $275 - $650 Paralegals $210 - $330 The attorneys and paralegals primarily responsible for representing the Committee, and their current standard hourly rates are: Michael D. Warner Member $900 Benjamin L. Wallen Associate $375 Kerri L. LaBrada Paralegal $290 In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Mr. Warner discloses that there are no alternative fee arrangements from customary billing and that no professional varies his or her rate based on geographic location. Mr. Warner further discloses that Cole Schotz has not represented the Committee or any member of the Committee in the 12 months prepetition; and the firm is in the process of developing a prospective budget and staffing plan for the Committee's review and approval. Cole Schotz will also be reimbursed for reasonable out-of-pocket expenses incurred. Michael D. Warner, Esq., Member of the law firm of Cole Schotz P.C., attests that his firm is disinterested within the meaning of section 101(14) of the Bankruptcy Code. Cole Schotz can be reached at: Michael D. Warner, Esq. COLE SCHOTZ P.C. 301 Commerce Street, Suite 1700 Fort Worth, TX 76102 Tel: (817) 810-5250 About Fieldwood Energy Fieldwood Energy is a portfolio company of Riverstone Holdings focused on acquiring and developing conventional assets, primarily in the Gulf of Mexico region. It is the largest operator in the Gulf of Mexico owning an interest in approximately 500 leases covering over two million gross acres with 1,000 wells and 750 employees. Visit https://www.fieldwoodenergy.com for more information. Fieldwood Energy and its 13 affiliates previously sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 18-30648) on Feb. 15, 2018, with a prepackaged plan that would deleverage $3.286 billion of funded by $1.626 billion. On Aug. 3, 2020, Fieldwood Energy and its 13 affiliates again filed voluntary Chapter 11 petitions (Bankr. S.D. Tex. Lead Case No. 20-33948). Mike Dane, senior vice president and chief financial officer, signed the petitions. At the time of the filing, Debtors disclosed $1 billion to $10 billion in both assets and liabilities. Judge David R. Jones oversees the cases. Debtors have tapped Weil, Gotshal & Manges LLP as their legal counsel, Houlihan Lokey Capital, Inc. as investment banker, and AlixPartners, LLP as financial advisor. Prime Clerk LLC is the claims, noticing and solicitation agent. The first lien group has employed O'Melveny & Myers LLP as its legal counsel and Houlihan Lokey Capital, Inc. as its financial advisor. The RBL lenders have employed Willkie Farr & Gallagher LLP as their legal counsel and RPA Advisors, LLC as their financial advisor. The cross-holder group has tapped Davis Polk & Wardwell LLP as its legal counsel and PJT Partners LP as its financial advisor. FIELDWOOD ENERGY: Committee Taps Stroock & Stroock as Counsel ------------------------------------------------------------- The official committee of unsecured creditors of Fieldwood Energy LLC and its affiliates seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to retain Stroock & Stroock & Lavan LLP as its counsel. The Committee requires Stroock to: a) advise the Committee with respect to the Committee's powers and duties under Bankruptcy Code section 1103 of the Bankruptcy Code; b) assist and advise the Committee in its consultations, meetings and negotiations with the Debtors, other creditors, and other parties-in-interest; c) assist the Committee in its investigation of the acts, conduct, assets, liabilities, and financial condition of the Debtors; d) assist the Committee in connection with any proposed sale of the Debtors' assets; e) assist the Committee in analyzing the claims of the Debtors' creditors and the Debtors' capital structure; f) assist and advise the Committee in negotiating with holders of claims, including analysis of possible objections to the priority, amount, subordination, or avoidance of claims and/or transfers of property in consideration of such claims, in coordination with the Committee's efficiency counsel; g) advise and represent the Committee in connection with matters generally arising in these Chapter 11 Cases, including the Debtors' motion to incur DIP financing, certain "second day" pleadings and other pleadings, in coordination with the Committee's efficiency counsel; h) assist the Committee in its review, analysis and negotiation of any potential compromises or settlements, and the assumption and rejection of executory contracts and unexpired leases in coordination with the Committee's efficiency counsel; i) assist the Committee in connection with any chapter 11 plan(s) that may be filed, and any disclosure statement and other documentation accompanying such plan(s), or any other disposition of these Chapter 11 Cases; j) appear before this Court, any other federal, state or appellate court, or the Office of the United States Trustee, on behalf of the Committee; k) take all necessary actions to protect and preserve the interests of the Committee and unsecured creditors generally, including (i) review and analysis of any reports or analyses prepared in connection with the Debtors' potential claims and causes of action, (ii) investigate any potential claims and causes of action, including prepetition transactions involving third parties; (iii) potential prosecution of actions on the Committee's behalf, (iv) if appropriate, negotiations concerning all litigation in which the Debtors are involved, and (v) advise the Committee with respect to the foregoing and perform such other diligence and independent analysis as may be requested by the Committee; l) respond to inquiries, as appropriate, from individual creditors as to the status of, and developments in, these Chapter 11 Cases; m) prepare, on behalf of the Committee, any pleadings, including without limitation, motions, applications, orders, memoranda, complaints, answers, objections, replies, responses, and papers with respect to any of the foregoing; and n) perform such other legal services as may be required or are otherwise deemed to be in the interests of the Committee in accordance with the Committee's powers and duties as set forth in the Bankruptcy Code, Bankruptcy Rules, or other applicable law. Stroock's hourly rates are: Partners $1,150 ??? $1,650 Associates/Special Counsel $550 ??? $1,195 Paraprofessionals $370 ??? $450 Stroock is "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code, according to court filings. Stroock can be reached through: Kenneth Pasquale, Esq. Stroock & Stroock & Lavan LLP 180 Maiden Lane New York, NY 10038 Phone: 212-806-5881 / 212-806-5400 Fax: 212-806-6006 Email: kpasquale@stroock.com About Fieldwood Energy Fieldwood Energy is a portfolio company of Riverstone Holdings focused on acquiring and developing conventional assets, primarily in the Gulf of Mexico region. It is the largest operator in the Gulf of Mexico owning an interest in approximately 500 leases covering over two million gross acres with 1,000 wells and 750 employees. Visit https://www.fieldwoodenergy.com for more information. Fieldwood Energy and its 13 affiliates previously sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 18-30648) on Feb. 15, 2018, with a prepackaged plan that would deleverage $3.286 billion of funded by $1.626 billion. On Aug. 3, 2020, Fieldwood Energy and its 13 affiliates again filed voluntary Chapter 11 petitions (Bankr. S.D. Tex. Lead Case No. 20-33948). Mike Dane, senior vice president and chief financial officer, signed the petitions. At the time of the filing, Debtors disclosed $1 billion to $10 billion in both assets and liabilities. Judge David R. Jones oversees the cases. Debtors have tapped Weil, Gotshal & Manges LLP as their legal counsel, Houlihan Lokey Capital, Inc. as investment banker, and AlixPartners, LLP as financial advisor. Prime Clerk LLC is the claims, noticing and solicitation agent. The first lien group has employed O'Melveny & Myers LLP as its legal counsel and Houlihan Lokey Capital, Inc. as its financial advisor. The RBL lenders have employed Willkie Farr & Gallagher LLP as their legal counsel and RPA Advisors, LLC as their financial advisor. The cross-holder group has tapped Davis Polk & Wardwell LLP as its legal counsel and PJT Partners LP as its financial advisor. FILTRATION GROUP: S&P Rates New $400MM Incremental Term Loan 'B' ---------------------------------------------------------------- S&P Global Ratings assigned its 'B' issue-level and '3' recovery ratings to Filtration Group Corp.'s (FGC's) proposed $400 million incremental first-lien term loan due 2025. The '3' recovery rating indicates S&P's expectation for meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a payment default. FGC intends to use the proceeds from this issuance to fund a dividend to shareholders, consisting predominantly of affiliates of privately held Madison Industries. "We believe the debt-funded dividend will cause the company's S&P Global Ratings-adjusted debt-to-EBITDA to approach our 7.5x downside rating trigger at the end of 2020, which reduces the cushion for operating underperformance or additional debt-funded outflows," the rating agency said. Still, FGC has a history of reducing leverage, primarily through EBITDA growth, and many of the company's end markets are seeing favorable demand trends, which supports S&P's forecast that leverage will decline to about 7x over the next 12 months. Specifically, S&P expects demand for indoor air quality, medical, bioscience, and pharmaceutical filtration products will continue to grow during the pandemic as customers perceive health and safety risks as heightened, while industrial product demand slowly recovers. Under S&P's base case scenario, revenue will decline by 4-9% in 2020 before increasing by a mid-single digit percentage in 2021. S&P expects FGC will maintain healthy high-teen percentage EBITDA margins through 2021 on favorable product mix, as well as productivity and sourcing initiatives, and generate good free cash flow of about $100 million or more, on an S&P Global Ratings-adjusted basis. Therefore, S&P's 'B' issuer credit rating and stable outlook on FGC are unchanged. Issue Ratings--Recovery Analysis Key analytical factors -- S&P's simulated default scenario assumes a payment default in 2023. The scenario contemplates a broad decline in business activities in FGC's key end markets, late adoption of new technologies, and increased competition from its more-established business counterparts, resulting in a significant decrease in revenue. -- S&P values the company on a going-concern basis. S&P bases the gross enterprise value of $1.09 billion on an emergence EBITDA of $199 million and a valuation multiple of 5.5x. The valuation multiple reflects FGC's replacement and recurring demand pattern, which it views favorably. -- S&P's recovery analysis assumes that in a default, after satisfying unpaid priority and administrative expenses, the first-lien secured debtholders would see meaningful (50%-70%; rounded estimate: 50%) recovery. Simulated default assumptions -- Simulated year of default: 2023 -- EBITDA at emergence: $199 million -- EBITDA multiple: 5.5x -- Jurisdiction: U.S. Simplified waterfall -- Net enterprise value at default (after 5% administrative costs): $1.04 billion -- Valuation split (obligor/nonobligor): 60%/40% -- Priority claims: $9 million -- Value available for first-lien creditors (collateral/unpledged value): ($885 million/$144 million) -- Estimated first-lien debt claims: $2.05 billion -- Recovery range: 50%-70% (rounded estimate: 50%) -- Value available to unsecured claims: $144 million -- Deficiency claims on secured debt: $1.17 billion -- Total unsecured claims: $1.17 billion -- Recovery expectations: Not applicable Note: Debt amounts include six months of accrued interest that it assumes will be owed at default. Collateral value includes asset pledges from obligors (after priority claims) plus equity pledges in nonobligors. S&P generally assumes usage of 85% for cash flow revolving facilities at default. FOOT AND ANKLE: Seeks to Hire Bonnie Bell as Legal Counsel ---------------------------------------------------------- The Foot and Ankle Center of Colorado, P.C. seeks approval from the U.S. Bankruptcy Court for the District Of Colorado to hire the Law Office of Bonnie Bell Bond, LLC as its legal counsel. The firm will render the following legal services: a. advise the Debtor with respect to its rights and duties; b. assist the Debtor in the development of a plan of reorganization or sale of its property; c. prepare legal papers; d. represent the Debtor in any litigation; e. perform all legal services for the Debtor. The legal services performed by the firm will be billed at the hourly rate of $300 and the paralegal services at the rate of $125 per hour. The firm received a retainer from the Debtor on the sum of $7,500. Bonnie Bell Bond, Esq. 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: Bonnie Bell Bond, Esq. Law Office of Bonnie Bell Bond, LLC 8400 E. Prentice Avenue, Suite 1040 Greenwood Village, CO 80111 Telephone: (303) 770-0926 Facsimile: (303) 770-0965 Email: bonnie@bellbondlaw.com About The Foot and Ankle Center of Colorado P.C. The Foot and Ankle Center of Colorado P.C. is a health care business corporation based in Highlands Ranch, Colo. The Foot and Ankle Center of Colorado sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Case No. 20-16282) on September 22, 2020. At the time of the filing, Debtor had estimated assets of less than $50,000 and liabilities of between $100,001 and $500,000. Law Office of Bonnie Bell Bond, LLC is Debtor's legal counsel. FORD STEEL: U.S. Trustee Unable to Appoint Committee ---------------------------------------------------- The Office of the U.S. Trustee on Oct. 14, 2020, disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of Ford Steel LLC. About Ford Steel LLC Ford Steel, LLC is in the business of steel product manufacturing from purchased steel. It fabricates for a wide variety of industries including the petrochemical industry, waste water treatment, transmission communication and broadcast towers, mining, and oil and gas industries. Visit http://www.fordsteelllc.comfor more information. Ford Steel filed a voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Case No. 20-34405) on Sept. 1, 2020. Herbert C. Jeffries, managing member, signed the petition. The Debtor estimated $1 million to $10 million in both assets and liabilities at the time of the filing. Judge Eduardo V. Rodriguez oversees the case. Cooper & Scully, PC serves as Debtor's legal counsel. FREEDOM MORTGAGE: S&P Rates New Senior Unsecured Notes 'B-' ----------------------------------------------------------- S&P Global Ratings assigned its 'B-' issue rating to Freedom Mortgage Corp.'s (B-/Stable/--) proposed senior unsecured notes due 2026. The recovery rating is '4' (30%), reflecting its view of average recovery in a simulated default scenario. S&P expected the transaction to be largely leverage neutral with only a small portion of the $500 million of proceeds used for general corporate purposes and paying associated fees and expenses; the primary uses of the proceeds are to refinance the existing 10.75% senior unsecured notes due 2024, repay the remainder of the Bank of America term loan, and pay off a portion of the KeyBank facility. Due to record origination levels over the past six months, leverage at the end of the second quarter was less than 2x, as measured by debt-to-EBITDA, well below historical levels. However, EBITDA declines in 2021 or 2022 due to declines in refinance volume could push leverage back above 5x. During the second quarter, the company reported strong EBITDA and originations driven by a favorable mortgage refinance origination environment and the company's ability to refinance its large book of servicing assets. "We expect the company to continue having strong origination volume for the remainder of 2020 as consumers refinance their mortgages and take advantage of the low interest rate environment. We expect eventual normalization in originations at some point when refinance volumes decrease, though the timing of this is difficult to predict," S&P said. Volume will also likely decline when Fannie Mae and Freddie Mac implement a 50-basis-point "market condition credit fee" on refinance activity, which is now slated to go into effect Dec. 1. The fee should not have an impact on Freedom's Federal Housing Administration lending, which continues to represent the largest share of the company's origination activity. S&P's ratings on Freedom factor in the volatility in earnings inherent in mortgage originations and particularly innate to refinance activity. FULTON PROPERTIES: Case Summary & 6 Unsecured Creditors ------------------------------------------------------- Debtor: Fulton Properties of Ohio LLC 700 Liverpool Dr Valley City, OH 44280 Business Description: Fulton Properties of Ohio LLC is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: October 15, 2020 Court: United States Bankruptcy Court Northern District of Ohio Case No.: 20-51878 Judge: Hon. Alan M. Koschik Debtor's Counsel: Frederic P. Schwieg, Esq. FREDERICK P SCHWIEG ATTORNEY AT LAW 19885 Detroit Rd #239 Rocky River, OH 44116-1815 Tel: 440-499-4506 Fax: 440-398-0490 Email: fschwieg@schwieglaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Douglas Perau, sole member/manager. A copy of the petition containing, among other items, a list of the Debtor's six unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/XCRSQKA/Fulton_Properties_of_Ohio_LLC__ohnbke-20-51878__0001.0.pdf?mcid=tGE4TAMA G WEALTH 88: Operator Files for Chapter 11 Bankruptcy Protection ---------------------------------------------------------------- Sonya Sorich of Sacramento Business Journal reports that the operator of a Japanese eatery on Broadway has filed for bankruptcy, amid a separate legal dispute that alleges the restaurant violated numerous California Labor Code provisions. G Wealth 88 Inc. voluntarily filed for Chapter 11 bankruptcy protection last month in the U.S. Bankruptcy Court for the Eastern District of California. G Wealth 88 is the entity behind Miso Japanese Restaurant, at 1517 Broadway in Sacramento. The restaurant has continued to operate during the pandemic and is not closing, said Winnie Fok, one of Miso's owners. "Business is not bad," Fok said. "We are still surviving." The bankruptcy is "a reorganization case and we expect that the restaurant will remain open," said Stephen M. Reynolds, of Davis-based Reynolds Law Corp., the attorney for G Wealth 88. The bankruptcy filing lists assets up to $61,726.84 and liabilities up to $41,946. The filing estimates that G Wealth 88 has between one and 49 creditors. It appears the Small Business Administration is the largest creditor, with an outstanding claim of $32,734, according to the filing. The SBA claim is tied to the pandemic, according to Reynolds, who said it was either a Paycheck Protection Program loan or an Economic Injury Disaster Loan. He did not immediately provide additional details. Both the PPP and EIDL are programs from the SBA to provide economic relief to businesses disrupted during Covid-19. G Wealth 88 is also facing a separate lawsuit, which was filed in July in Sacramento County Superior Court. In that lawsuit, plaintiff Roger Lee is seeking compensatory and punitive damages from the business for alleged violations of labor code provisions. The lawsuit says Lee is the former owner of Miso, and he sold the business to Wing Sze Fok and G Wealth 88 around late 2015/early 2016. "During the sale, Plaintiff continued to manage the restaurant on behalf of G Wealth 88 Inc. while they transitioned to living in the United States of America," the lawsuit states. Among other allegations, the lawsuit alleges G Wealth 88 misclassified Lee as an exempt employee. The defendants also "failed to provide mandatory sick leave as required by California law, failed to pay overtime pursuant to California statute, despite such overtime being worked and made unauthorized deductions and alterations in Plaintiff's salary which were not agreed to," the lawsuit states. It adds, "Further, Plaintiff was forced to work at times without breaks and/or meal periods without agreeing to such arrangement and/or without a justifiable basis in the nature of the work pursuant to California law." Miso's operators dispute the allegations, Fok told the Business Journal this week. One of Lee's attorneys -- David L. Cohen of Young, Cohen & Durrett LLP in Arden-Arcade -- declined to further discuss the lawsuit with the Business Journal, citing a policy of not commenting on ongoing litigation. Reynolds, the bankruptcy attorney for G Wealth 88, has petitioned Sacramento County Superior Court for an automatic stay on Lee's lawsuit, based on the bankruptcy filing. Miso has four stars on Yelp, based on more than 350 reviews. About G Wealth 88 Inc. G Wealth 88, Inc., the entity behind Miso Japanese Restaurant, at 1517 Broadway in Sacramento, California, sought protection under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. E.D. Cal. Case No. 20-24356) on September 15, 2020. At the time of the filing, the Debtor had estimated assets of between $50,001 and $100,000 and liabilities of less than $50,000. Stephen M. Reynolds, Esq., is the Debtor's legal counsel. GB HOLDINGS: U.S. Trustee Unable to Appoint Committee ----------------------------------------------------- The Office of the U.S. Trustee disclosed in a court filing that no official committee of unsecured creditors has been appointed in the Chapter 11 case of GB Holdings of Georgia Inc. About GB Holdings of Georgia Inc. GB Holdings of Georgia Inc., a Decatur, Ga.-based single asset real estate corporation, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No. 20-68647) on Aug. 3, 2020. At the time of the filing, the Debtor had estimated assets of less than $50,000 and estimated liabilities of less than $50,000. Judge Paul Baisier oversees the case. Giddens, Mitchell & Associates P.C., is Debtor's legal counsel. GENERAL MACHINE: Seeks to Hire Daniel L. Freeland as Legal Counsel ------------------------------------------------------------------ General Machine Solutions, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Indiana to hire Daniel L. Freeland & Associates, P.C. as its legal counsel. The firm will render the following professional services: (a) give Debtor legal advice with respect to its power and duties; (b) defend complaints and motions for relief to stay filed by creditors of the Debtor; (c) protect the Debtor's interest in any executory contracts; (d) prepare legal papers; (e) perform all other legal services for Debtor; and (f) prepare and file plans, disclosures and other papers. The firm's current hourly rates for services which are to be performed for the Debtor is in the amount of $400 per hour for Daniel Freeland, Esq., and $300 and $275 for associates. The firm received a retainer of $15,000 prior to the filing of the bankruptcy case. Daniel L. Freeland neither holds nor represents any interest adverse to the Debtor and its estate. The firm can be reached through: Daniel L. Freeland, Esq. Daniel L. Freeland & Associates, P.C. 9105 Indianapolis Blvd. Highland, IN 46322 Telephone: (219) 922-0800 Facsimile: (219) 922-1261 Email: dlf9601@aol.com About General Machine Solutions Inc. General Machine Solutions Inc. is a licensed and bonded freight shipping and trucking company running freight hauling business from East Chicago, Ind. General Machine Solutions sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ind. Case No. 20-21885) on Sept. 24, 2020. At the time of the filing, Debtor had estimated assets and liabilities of less than $50,000. Daniel L. Freeland & Associates, P.C. is Debtor's legal counsel. GEORGIA DIRECT: Dills Buying Richmond Property for $81.5K --------------------------------------------------------- Georgia Direct Carpet, Inc. ("GDC"), Georgia Direct West, LLC and M3 Holdings, LLC, ask the U.S. Bankruptcy Court for the Sothern District of Indiana to authorize the private sale of GDC's parcel of real estate commonly known as 1513-1530 South 9th Street, Richmond, Indiana, and more accurately described as Lots 38, 39, 40, 41, 42, 43, 44, 45, 46, 92 & 93 Beallview Exc Right of Way Grant to State & Lot 37 Beall Exc 82.6 x 101 feet to state, to John W. Dills for $81,500. Baumgartner Commercial, Inc. has marketed the Real Estate and has received an offer to purchase it for a price lower but to that for which it was listed but still commercially reasonable in the opinion of the Broker, the Debtors, and 3Rivers Credit Union, formerly known as West End Bank, S.B. GDC currently owns the Real Estate, which was financed through the Bank. As set forth in Proof of Claim No. 34, the Bank has a lien on the Real Estate, which lien amount exceeds the Purchase Price for the Real Estate. The Purchase Agreement details the terms of the proposed sale of the Real Estate between M3 and the Purchaser. There is no known relationship between Debtors or any insiders of the Debtors and the Purchaser either currently or anticipated following consummation of the sale. The Purchaser has agreed to purchase the Real Estate for $81,500. In light of the Bank's lien on the Real Estate, the Purchase Price will be paid directly to the Bank. The only material contingency of the potential sale is approval from the Court. The sale does not involve the sale of any personally identifiable information. Pursuant to 11 U.S.C. Section 363(f), the Real Estate would be sold free and clear of all known liens. The Debtors submit that the sale of the Real Estate through the means of a private sale is an exercise of their sound business judgment. They also submit that proceeding with the purchase of the Real Estate through a private sale is in the best interest of the estate and its creditors. About Georgia Direct Carpet Georgia Direct Carpet, Inc., also known as Georgia Carpet Direct, owns and operates a carpet and flooring store in Richmond, Ind. It offers carpets, hardwoods, laminate flooring and ceramic tile floor products. Georgia Direct Carpet and its affiliates sought Chapter 11 protection (Bankr. S.D. Ind. Lead Case No. 19-06316) on Aug. 26, 2019. In the petition signed by Anthony Bledsoe, president, Georgia Direct Carpet estimated assets and liabilities at $1 million to $10 million. The Hon. Robyn L. Moberly is the case judge. The Debtors tapped Mattingly Burke Cohen & Biederman LLP as their legal counsel; Mattingly Burke Cohen & Biederman LLP, as special counsel; and Barron Business Consulting, Inc. as their financial advisor. The Office of the U.S. Trustee appointed creditors to serve on the official committee of unsecured creditors on Oct. 9, 2019. The committee is represented by Mercho Caughey. On Aug. 7, 2020, the Court appointed Baumgartner Commercial, Inc., as real estate broker. GIGA WATT: Trustee Selling Moses Lake Equipment for $42K -------------------------------------------------------- Mark Waldron, the Chapter 11 trustee for Giga Watt Inc., asks the U.S. Bankruptcy Court for the Eastern District of Washington to authorize the bidding procedures in connection with the sale of the equipment located at the Debtor's facility in Moses Lake, Washington, Chain Lodge 1, LLC for $42,000, free and clear of all liens, claims and interests, subject to overbid. The Buyer pays refundable deposit of $4,200. The Deposit will be applied to the Purchase Price, if approved. If the Sale is not approved, the Trustee to return to deposit to the Buyer. The following are excluded ffrom the sale (i) five Antminer S9 miners and 95 Panda B3 miners being transferred to Allrise IP Holding, Inc., by separate agreement; (ii) Equipment located in Pod 8 of the ML Facility; (iii) the electrical infrastructure, any shelving, and Power Distribution units ("PDUs") located at the ML Facility; and (iv) the forklift or any property or items not listed on Schedule 1. The sale is subject to overbidding in increments of $5,000. The Buyer may participate in the overbidding. The Trustee completes delivery by making ML Equipment available to the Buyer at their current location. The Buyer assumes all responsibility, expense and risk of moving ML Equipment. The Closing will occur seven calendar days after entry of order approving the Sale. The Notice will be served upon the Master Mailing List and all the parties who have contacted the Trustee regarding equipment purchase. Finally, the Trustee asks that the Court waives the 14-day stay provided by Bankruptcy Rule 6004(h). A telephonic hearing on the Motion is set for Oct. 6, 2020 at 10:30 a.m. Telephone: (509) 353-3183. The objection deadline is Oct. 2, 2020. A copy of the Agreement is available at https://tinyurl.com/y6ctsdlr from PacerMonitor.com free of charge. About Giga Watt Inc. Giga Watt Inc., a cryptocurrency mining services provider based in East Wenatchee, Washington, filed for Chapter 11 protection (Bankr. E.D. Wash. Case No. 18-03197) on Nov. 19, 2018. In the petition signed by Andrey Kuzenny, secretary, the Debtor estimated up to $50,000 in assets and $10 million to $50 million in liabilities. The case is assigned to Judge Frederick P. Corbit. Winston & Cashatt, Lawyers, led by shareholder Timothy R. Fischer, is the Debtor's counsel. The Office of the U.S. Trustee appointed an official committee of unsecured creditors on Dec. 19, 2018. The committee tapped DBS Law as its legal counsel. On Jan. 23, 2019, the court approved the appointment of Mark D. Waldron as the Chapter 11 trustee for the Debtor's estate. The Trustee is represented by CKR Law LLP. GNC HOLDINGS: Court Approves Chapter 11 Sale to Harbin Pharma ------------------------------------------------------------- Law360 reports that health and nutrition product retailer General Nutrition Centers (GNC) received a Delaware bankruptcy judge's approval Thursday, September 17, 2020, for an up to $770 million Chapter 11 sale to China's Harbin Pharmaceutical Group Holding Co. Ltd. , with Harbin to pick up at least 1,400 of the chain's stores. U.S. Bankruptcy Judge Karen B. Owens gave a nod to the transaction after a series of last-minute compromises, bolstered by concessions that cleared away objections from GNC's official committee of unsecured creditors. "The settlement not only resolves the committee's objections to the sale, but also forms the cornerstone to a fully consensual plan. Leslie A. Pappas of Bloomberg Law reports that the creditors of GNC Holdings opposed to the bankruptcy sale. Bankrupt GNC Holdings Inc.'s proposed $770 million sale to its largest shareholder is an "insider" deal that offers few benefits and includes a "death trap that seeks to silence" objectors, the nutrition supplement retailer's unsecured creditors say. GNC hasn't shown that the sale price to China-based Harbin Pharmaceutical Group Holding Co. is fair or that the sale is better than a stand-alone restructuring, a committee of unsecured creditors argued in a court filing. About GNC Holdings Inc. 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. GNC HOLDINGS: Court Confirms Plan After $780 Mil. Stores Sale ------------------------------------------------------------- Law360 reports that health supplement and vitamin retailer GNC received approval Wednesday, Oct. 14, 2020, in Delaware bankruptcy court for its Chapter 11 plan centered on disbursing the proceeds of a $780 million sale of 1,400 of its stores. During a virtual confirmation hearing, GNC attorney Richard A. Levy of Latham & Watkins LLP said the plan enjoyed the overwhelming support of impaired creditors and was being presented on a nearly consensual basis with just a single objection outstanding at the start of the hearing. Levy said that 100% of term loan lenders, who were owed $441 million, had voted in favor of the plan. 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. GNC HOLDINGS: Expects Sale Closing Prior to Sale Hearing -------------------------------------------------------- GNC Holdings, Inc., et al. submitted a Fifth Amended Joint Chapter 11 Plan of Reorganization. The Debtors and the Required Consenting Parties have agreed that the Debtors will pursue on a parallel path basis both the Restructuring and a Sale Transaction. On Sept. 18, 2020 the Bankruptcy Court entered a sale order, authorizing the sale of the Debtors' assets to ZT Biopharmaceutical LLC, as designee of the successful bidder. At this time the Debtors anticipate that the sale transaction will close prior to the confirmation hearing. However, if the sale transaction is terminated or is no longer in full force and effect or is not consummated, or is not capable of being consummated, in each case, by the applicable Outside Sale Date in accordance with the terms of the Sale Transaction Documents, then the Debtors and Required Consenting Parties have agreed to consummate the Restructuring in accordance with this Plan. If the Sale Transaction is consummated, the proceeds therefrom shall be distributed in accordance with this Plan. The Plan reflects the terms of a global settlement among the Debtors, the Ad Hoc Group of Crossover Lenders, the FILO Ad Hoc Group, the Successful Bidder, the Committee, and the Ad HocGroup of Convertible Notes, all as more fully set forth in the Settlement Motion. Bankruptcy Court approval of the global settlement set forth in the Settlement Motion and the Settlement Order becoming a Final Order is a condition precedent to the occurrence of the Effective Date. A full-text copy of the Fifth Amended Joint Chapter 11 Plan of Reorganization dated September 30, 2020, is available at https://tinyurl.com/y6mmbq5c from PacerMonitor.com at no charge. Counsel for the Debtors: Michael R. Nestor (No. 3526) Kara Hammond Coyle (No. 4410) Andrew L. Magaziner (No. 5426) Joseph M. Mulvihill (No. 6061) Jared W. Kochenash (No. 6557) YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, Delaware 19801 Telephone: (302) 571-6600 Facsimile: (302) 571-1253 Email: mnestor@ycst.com kcoyle@ycst.com amagaziner@ycst.com jmulvihill@ycst.com jkochenash@ycst.com - and - Richard A. Levy (admitted pro hac vice) Caroline A. Reckler (admitted pro hac vice) Asif Attarwala (admitted pro hac vice) Brett V. Newman (admitted pro hac vice) LATHAM & WATKINS LLP 330 North Wabash Avenue, Suite 2800 Chicago, Illinois 60611 Telephone: (312) 876-7700 Facsimile: (312) 993-9767 Email: richard.levy@lw.com caroline.reckler@lw.com asif.attarwala@lw.com brett.newman@lw.com - and - George A. Davis (admitted pro hac vice) Andrew C. Ambruoso (admitted pro hac vice) Jeffrey T. Mispagel (admitted pro hac vice) 885 Third Avenue New York, New York 10022 Telephone: (212) 906-1200 Facsimile: (212) 751-4864 Email: george.davis@lw.com andrew.ambruoso@lw.com jeffrey.mispagel@lw.com About GNC Holdings GNC Holdings Inc. is a global health and wellness brand with a diversified omni-channel business. In its stores and online, GNC Holdings sells an assortment of performance and nutritional supplements, vitamins, herbs and greens, health and beauty, food and drink, and other general merchandise, featuring innovative private-label products as well as nationally recognized third-party brands, many of which are exclusive to GNC Holdings. Visit www.gnc.com for more information. GNC Holdings and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-11662) on June 23, 2020. 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. GROW CAPITAL: Incurs $2.35 Million Net Loss in Fiscal 2020 ---------------------------------------------------------- Grow Capital, Inc. filed with the Securities and Exchange Commission its Annual Report on Form 10-K reporting a net loss of $2.35 million on $2.37 million of total revenues for the year ended June 30, 2020, compared to a net loss of $2.33 million on $1.06 million of total revenues for the year ended June 30, 2019. As of June 30, 2020, the Company had $1.91 million in total assets, $1.92 million in total liabilities, and a total stockholders' deficit of $8,045. As of June 30, 2020, the Company had total current assets of $774,537 and a working capital deficit of $269,576, compared to total current assets of $2,950,256 (including stock based compensation recorded as prepaid expenses of $1,380,459) and working capital of $1,766,261 as of June 30, 2019. The decrease in the Company's working capital was primarily a result of the disposition of assets held for sale, the reduction in prepaid expenses, collection of a subscription receivable and a reduction in cash, offset by an increase in related party receivables and promissory note receivables. L J Soldinger Associates, LLC, in Deer Park, Illinois, the Company's auditor since 2017, issued a "going concern" qualification in its report dated Oct. 13, 2020, citing that the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. A full-text copy of the Form 10-K is available for free at: https://www.sec.gov/Archives/edgar/data/1448558/000144586620001527/grwc_10k.htm About Grow Capital Grow Capital (f/k/a Grown Condos, Inc.) -- http://www.growcapitalinc.com/-- was a call center that contracted out as a customer contact center for a variety of business clients throughout the United States. Over time its main business became a third-party verification service. While continuing to operate as a call center, in 2008 the Company expanded its business plan to include the development of a social networking site called JabberMonkey (Jabbermonkey.com) and the development of a location based social networking application for smart phones called Fanatic Fans. HALS REALTY: Trustee Selling 401-411 Parcel to Rhinebeck for $21M ----------------------------------------------------------------- Michael Goldberg, the Trustee to Hals Realty Associates Limited Partnership's Chapter 11 case, asks the U.S. Bankruptcy Court for the Southern District of Florida to authorize the bidding procedures in connection with the sale of the real property located at 401-411 South County Road and 175 Worth avenue, Palm Beach County, Florida to Rhinebeck Realty, LLC, pursuant to their Asset Purchase Agreement for $21 million, subject to overbid. The Debtor is the owner in fee simple title to the 401-411 Parcel. The Debtor has three unexpired leases with the following tenants, which leases will be assumed and assigned pursuant to the Stalking Horse APA: a. The July 20, 2012 lease agreement between JP Morgan Chase Bank N.A. and the Debtor for a portion of the 401-411 Parcel with the address of 411 South County Road, Palm Beach, FL 33480 and any amendments thereto. Chase further has a right of first refusal pursuant to the Chase Lease in regards to any offers made for the purchase of the 401-411 Parcel and has 45 days from the notice of any offer to purchase the 401-411 Parcel to match the offer ("Chase ROFR"). b. The 1998 lease agreement between the United States Postal Service and the Debtor for a portion of the 401-411 Parcel with the address of 401 South County Road, Palm Beach, FL 33480 (the ???USPS Lease???) and any amendments thereto. c. The Dec. 7, 2000 lease agreement between Tourneau Jewelers Inc. and the Debtor for a portion of the 401-411 Parcel with the address of 175 Worth Avenue, Palm Beach, FL 33480 and any amendments thereto. After arms'-length negotiations, the Trustee, together with the Stalking Horse Bidder, agreed in principal and subject to Court approval to the terms of the Stalking Horse APA for the Sale of the 401-411 Parcel for the aggregate purchase price of $21 million. The material terms of the Stalking Horse APA are: a. Purchase Price: $21 million b. Initial Deposit: $250,000, no later than 24 hours after the Court's issuance of an order approving the form of the Stalking Horse APA c. First Additional Deposit: $800,000, within two Business Days after the expiration of the Inspection Period, Stalking Horse Bidder d. Second Additional Deposit: $1.05 million, if there are any Qualified Bids submitted by the Bid Deadline, within two Business Days after the Bid Deadline, Stalking Horse Bidder e. Acquired Assets: The Prevailing Bidder will acquire the 401-411 Parcel, all buildings and improvements thereon, and including, if any, all of the right, title, and interest of the Debtor in and to all rights-of-way, easements, public and private streets, roads, avenues, and alleys, in front of or abutting the Property or any portion thereof, if any, and Leases. f. Free and Clear: The Prevailing Bidder will acquire the 401-411 Parcel free and clear of all liens, claims, interests, and encumbrances, with the exception of Permitted Liens, with any such valid liens, claims, interests and encumbrances attaching to the proceeds of the sale. g. Assumed Liabilities: The Trustee will assign to the to the Prevailing Bidder the Debtor's interest in and to the Unexpired Leases, by duly executing an assignment and assumption agreement. h. Closing Date: The Sale will close no later than 30 days following the entry of the Approval Order, which Approval Order will contain a waiver of any stay pending appeal. i. Inspection Period: The Stalking Horse Bidder will have 45 days from the Effective Date to conduct such tests, inspections, analysis and reports relating to the 401-411 Parcel as the Stalking Horse Bidder deems necessary. j. As-Is Where Is: The Prevailing Bidder accepts the condition of the 401-411 Parcel "as is, where is, with all faults." k. Breakup Fee: $200,000 The salient terms of the Bidding Procedures are: a. Bid Deadline: 45 days from the entry of the Court's order approving the requested Bid Procedures and scheduling a Sale Hearing b. Initial Bid: $21.25 million c. Deposit: $2.1 million d. Auction: If one or more Qualified Bids are received, the Trustee will conduct an auction with respect to the 401-411 Parcel prior to the Sale Hearing via Zoom or similar video or electronic format and all Qualified Bidders will be provided login credentials to participate. e. Bid Increments: $50,000 Within 72 hours after the conclusion of the Auction, the Trustee will file a notice identifying the Prevailing Bidder and any Backup Bidders with the Court. The Trustee asks that service of the Motion be deemed sufficient notice to Chase, who holds a right of first refusal in regards to the Debtor's sale of the 401-411 Parcel pursuant to the Chase Lease, to trigger the 45-day deadline Chase has to match the Stalking Horse Bid and to participate in the Auction. To the extent that Chase declined to exercise the Chase ROFR, the Trustee will solicit a written waiver from Chase of the Chase ROFR prior to any proposed Auction among competing bidders. The Trustee asks that, in a preliminary hearing, the Court, approves his entry into the Stalking Horse APA, approves the Bid Procedures and Breakup Fee contained in the Stalking Horse APA, approves the form and manner of notice of the Sale, schedules a Bid Deadline, schedules an Auction, and schedules a Sale Hearing. The Trustee submits that the assumption and assignment of the Unexpired Leases to the Prevailing Bidder is necessary to the consummation of the Sale and is well within his sound business judgment. Accordingly, he submits that the assumption and assignment to the Prevailing Bidder of the Unexpired Leases should be approved as an exercise of his sound business judgment. It is critical that the Trustee close the sale of the 401-411 Parcel as soon as possible after the final Sale Hearing. All parties in interest, including Chase and the other tenants, will have more than sufficient time to determine whether or not to object or otherwise have their interests heard prior to the Sale Hearing. Accordingly, the Trustee asks that the Court waives the 14-day stay periods under Bankruptcy Rules 6004(h) and 6006(d). A copy of the APA and the Bidding Procedures is available at https://tinyurl.com/y4q4s7cn from PacerMonitor.com free of charge. About of Hals Realty Associates Hals Realty Associates Limited Partnership sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-13103) on March 5, 2020. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $10,000,001 and $50 million. Judge Mindy A. Mora oversees the case. Furr and Cohen, P.A. is Debtor's legal counsel. Michael Goldberg is the appointed trustee to Debtor's Chapter 11 case. He is represented by Eyal Berger, Esq., at Akerman LLP. HENNEPIN AVENUE: Butcher & the Boar Owner Liquidating in Chapter 7 ------------------------------------------------------------------ Dylan Thomas of Minneapolis/St. Paul Business Journal reports that the entity that operated as the now-closed downtown Minneapolis restaurant Butcher & the Boar filed Oct. 5, 2020 for Chapter 7 bankruptcy protection. Opened in 2012 and nominated the following year for a James Beard Award for "Best New Restaurant," the original Hennepin Avenue location of Butcher and the Boar closed permanently in September. Owner Doug Van Winkle cited the impact of Covid-19 and social unrest in the Twin Cities over the summer as two factors behind the decision. A second Butcher & the Boar location opened in 2019 in a Charleston, South Carolina, suburb continues to operate. Van Winkle, also named as a creditor in the filing, lists an apartment address less than three blocks away from that location. Van Winkle opened Butcher & the Boar with former co-owner Tim Rooney, who died in 2018. In a 2015 interview with the Business Journal, Van Winkle said he originally purchased the Butcher & the Boar property at 1121 Hennepin Ave. with plans for a residential development before deciding instead to open a restaurant on the site. The property sold in 2016 for $6 million in a sale-leaseback deal with a Scottsdale, Arizona-based Store Capital Corp., a real estate investment trust, according to a certificate of real estate value. The certificate indicates the lease period was 180 months, or 15 years. Store Capital is listed as one of the creditors in the bankruptcy filing. U.S. Bankruptcy Court for the District of Minnesota scheduled a meeting of Butcher & the Board creditors for Oct. 29, 2020. About Butcher & the Boar Hennepin Avenue Restaurant LLC operated Butcher & the Boar, a restaurant located at Hennepin Avenue in downtown Minneapolis was known for its bourbon, ample meat portions, and a year-round, heated beer garden. Hennepin Avenue Restaurant LLC filed a Chapter 7 petition (Bankr. D. Minn. Case No. 20-42367) on Oct. 5, 2020. Hennepin Avenue Restaurant listed estimated assets of not more than $50,000 and liabilities of between $10,000,001 and $50 million. The Debtor's counsel: Chad A. Kelsch Kelsch Law Firm PA Tel: 763-398-1676 E-mail: chad@kelschlawfirm.com HERITAGE HOTEL: Taps Walters Levine as Special Litigation Counsel ----------------------------------------------------------------- Heritage Hotel Associates, LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Walters Levine Lozano DeGrave as its special litigation counsel. The firm will represent the Debtor in connection with pending litigation involving CCP SP Hotel, LLC on issue related to the sale of a hotel property and the claims acquired by CCP. The firm's current hourly rates are as follows: $400 for Stuart Jay Levine, $300 for associates, and $140 for paralegals. The Debtor desires to pay the firm a $20,000 post-petition retainer from cash on hand. Stuart Jay Levine, Esq., at Walters Levine, disclosed in court filings that the firm neither holds nor represents any interest adverse to the Debtor or its estate. The firm can be reached through: Stuart Jay Levine, Esq. Walters Levine Lozano DeGrave 601 Bayshore Blvd. Ste 720 Tampa, FL 33606-2760 Telephone: (813) 254-7474 E-mail: slevine@walterslevine.com About Heritage Hotel Associates Heritage Hotel Associates, LLC, is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). Heritage Hotel Associates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 19-09946) on Oct. 21, 2019. At the time of the filing, the Debtor was estimated to have assets of between $10 million and $50 million, and liabilities of between $1 million and $10 million. Johnson Pope Bokor Ruppel & Burns, LLP, is the Debtor's legal counsel. Berkadia Real Estate Advisors, LLC, is the real estate agent. HERITAGE RAIL: Seeks Approval to Hire Moglia Advisors, Appoint CRO ------------------------------------------------------------------ Heritage Rail Leasing, LLC seeks approval from the U.S. Bankruptcy Court for the District of Colorado to hire Moglia Advisors to provide restructuring services and designate Alex Moglia as its chief restructuring officer. The Debtor desires to employ Moglia to provide the following chief restructuring officer services: a. assess the financial and operational facts and circumstances; b. manage the sales and leasing activities of the Debtor; c. prepare and maintain a cash flow projection; d. manage all operations and finances of the Debtor; e. discuss regularly the progress of the case with the U.S. Trustee, Big Shoulders Capital, LLC, all other secured, priority, and unsecured creditors; f. prepare and file monthly operating reports to the court; g. evaluate the merits of pursuing any litigation; h. perform other services; and i. maximize proceeds for the benefit of creditors, on a priority basis. Moglia Advisors received a retainer in the amount of $10,000. The firm is a "disinterested person" as defined within Bankruptcy Code Section 101(14), according to a court filing. The firm can be reached through: Alex Moglia Moglia Advisors 1325 Remington Road, Suite H Schaumburg, IL 60173 Telephone: (847) 884-8282 Facsimile: (847) 884-1188 Email: amoglia@mogliaadvisors.com About Heritage Rail Leasing, LLC Janesville, Wis.-based Heritage Rail Leasing, LLC leases railrolling stocks, locomotives, and track equipment. Heritage Rail Leasing sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Colo. Case No. 20-15606) on August 21, 2020. Judge Thomas B. McNamara oversees the case. Brownstein Hyatt Farber Schreck, LLP is Debtor's legal counsel. IRONCLAD ENCRYPTION: Seeks to Hire Pendergraft & Simon as Counsel ----------------------------------------------------------------- IronClad Encryption Corporation seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Pendergraft & Simon, LLP, with Leonard H. Simon, Esq. to serve as its lead bankruptcy counsel. The professional services Mr. Simon and the firm intend to render are the following: a. analyze the financial situation, and render advice and assistance to the Debtor in determining whether to file petitions under Title 11, United States Code; b. advise Debtor with respect to its powers and duties; c. conduct appropriate examinations of witnesses, claimants and other persons; d. prepare legal papers, and advise the Debtor-in-Possession in connection with the operation of or the termination of the operation of the business; e. represent the Debtor at the meeting of creditors and such other services; f. represent Debtor-in-Possession in all proceedings before the court; g. prepare a disclosure statement and plan of reorganization; h. consult with the Debtor-in-Possession concerning questions arising in the conduct of the administration of the estate; i. investigate pre-petition transactions and prosecution, preference and other avoidance actions; j. defend any motions to lift the automatic stay, contested matters and/or adversary proceedings; k. appear before the court; l. assist Debtor-in-Possession with real estate and business organizations issues; m. assist Debtor in any matters relating to or arising out of the case. The firm's hourly rate for counsel and staff are: Leonard Simon $500 William P. Haddock $300 Senior paralegal/senior law clerk $200 Junior paralegal/senior law clerk $100. Leonard H. Simon, Esq. disclosed in court filings that the firm, along with its attorneys, employees, and agents are "disinterested persons" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Leonard H. Simon, Esq. William P. Haddock, Esq. Pendergraft & Simon, LLP 2777 Allen Parkway, Suite 800 Houston, TX 77019 Telephone: (713) 528-8555 Facsimile: (713) 868-1267 About IronClad Encryption Corporation Based in Houston, Texas, IronClad Encryption Corporation is engaged in the business of developing and licensing the use of cyber software technology that encrypts data files and electronic communications. Visit https://www.ironcladencryption.com for more information. IronClad Encryption sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-34332) on August 28, 2020. The petition was signed by J.D. McGraw, president. At the time of the filing, Debtor had estimated assets of between $500,000 and $1 million and liabilities of between $1 million and $10 million. Judge Christopher M. Lopez oversees the case. Pendergraft & Simon LLP is Debtor's legal counsel. JACOBSON HOTELS: Taps J. Beard as Real Estate Broker ---------------------------------------------------- Jacobson Hotels, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire The J. Beard Real Estate Company as its real estate broker. The Debtor requires the firm to market and sell its real estate located at 18484 Interstate 45 S., Shenandoah, Texas, which is essential to funding its anticipated plan of reorganization. The firm is entitled to receive a real estate broker's commission, upon the consummation of any such sale and shall be paid from escrow, a real estate broker's commission in an amount equal to 3 percent of the closing sales price with no buyer's broker, and a 50 percent split of 5 percent of the closing sales price with a co-broker for the buyer. Steven Jeffrey Beard, the founder of J. Beard Real Estate, disclosed in court filings that the firm and its principals are "disinterested persons" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Steven Jeffrey Beard The J. Beard Real Estate Company 10077 Grogan's Mill Road Suite 135 The Woodlands, Texas 77380 Telephone: (281) 367-2220 About Jacobson Hotels Jacobson Hotels, Inc., based in Shenandoah, TX, filed a Chapter 11 petition (Bankr. S.D. Tex. Case No. 20-33957) on Aug. 4, 2020. In its petition, the Debtor disclosed $5,757,149 in assets and $3,850,120 in liabilities. The petition was signed by Grace L. Jacobson, director. The Hon. Jeffrey P. Norman presides over the case. DEVINE LAW FIRM, PC, serves as bankruptcy counsel to the Debtor. JAGGED PEAK: TradeGlobal Still in Business After $9.4M Sale ----------------------------------------------------------- Ohio-based TradeGlobal LLC was expected to close its doors following its voluntary chapter 11 bankruptcy last year. Instead it has opened them wider than ever, with the company emerging under new ownership. Force 10 Partners, a premier operational and financial restructuring consulting firm, led the TradeGlobal LLC restructuring. "The Force 10 team pulled off an impressive recovery against incredible odds," said Michael Mercier, the former CEO of TradeGlobal. "Without them, we could have lost so much. I can't thank them enough." TradeGlobal's Ohio fulfillment center and its technology platform for managing international transactions were sold in an accelerated process led by Force 10 Partners, with the advisory firm's Jeremy Rosenthal serving as TradeGlobal's chief restructuring officer and Nicholas Rubin leading the firm's financial advisory services. Mr. Rosenthal and Mr. Rubin then guided the company through the sale and to a confirmed plan that implemented an intricate settlement with TradeGlobal's international parent, its sister-company Jagged Peak, Inc., the Unsecured Creditors Committee and the estates' largest creditor. When TradeGlobal, which specializes in online retail services, entered bankruptcy last year, media anticipated a closure that would cost the area more than 350 jobs. "We saw incredible value worth preserving in TradeGlobal. TradeGlobal provided essential fulfillment services for a number of major brands and stable good-paying jobs to the community," said Rosenthal, a principal at Force 10 Partners. "We focused on preserving TradeGlobal's impressive operations, client base and cutting edge technology platform while we pursued a sale. At the end of the case we anticipate making significant distributions to creditors???all in a case some thought was headed into a chapter 7 liquidation." Under Force 10's guidance, TradeGlobal's business was sold for $9.4 million following a 10-round auction that improved the purchase price by approximately $3.6 million. About Force Ten Partners Force Ten Partners, LLC, is an advisory firm with deep domain knowledge in financial and operational corporate restructuring, valuation, forensic accounting, and complex litigation support. Force 10 serves middle-market companies as well as their creditors, stakeholders, and professionals by providing turnaround-management services (CRO), financial advisory services, expert witness support, and investment banking and M&A advisory services. About Jagged Peak Jagged Peak Inc. and its subsidiaries are software companies in Tampa, Florida. TradeGlobal is an end-to-end eCommerce provider, offering a full range of services, solutions and systems tailored to meet our clients' specific needs. Jagged Peak, et al., deliver end-to-end global eCommerce solutions that help companies break into new markets and build customer base by creating a seamless experience across borders for all product types. Jagged Peak, Inc., based in Tampa, FL, and its affiliates sought Chapter 11 protection (Bankr. D. Nev. Lead Case No. 19-15959) on Sept. 16, 2019. In the petitions signed by CRO Jeremy Rosentha, Jagged Peak, and TradeGlobal, LLC, were estimated to have assets of $50 million to $100 million and liabilities of $10 million to $50 million; and TradeGlobal North America Holding, Inc., was estimated to have assets of $1 million to $10 million and liabilities of less than $50,000. The Hon. Mike K. Nakagawa oversees the cases. Gregory E. Garman, Esq., at Garman Turner Gordon, serves as bankruptcy counsel to the Debtors. BMC Group, Inc., is the claims and noticing agent to the Debtors. JIM'S DISPOSAL: Nov. 12 Auction of Assets Set --------------------------------------------- Judge Brian T. Fenimore of the U.S. Bankruptcy Court for the Western District of Missouri authorized the bidding procedures proposed by Jim's Disposal Service, LLC ("JDS") and Byrdland Properties, LLC in connection with the proposed sale of (i) a solid waste processing facility, or Transfer Station, located at 17200 Industrial Drive, in the Village of River Bend, Missouri, owned by JDS; (ii) the 21-year Solid Waste Processing Facility Operating Permit issued by the Missouri Department of Natural Resource to operate the Transfer Station; and (iii) certain other assets, consisting of the trucks and equipment, to River Bend Recycling and Transfer, LLC for $4,623,800, subject to overbid. The salient terms of the Bidding Procedures are: a. Bid Deadline: Nov. 5, 2020 at 5:00 p.m. (CT) b. Initial Bid: Equal to or greater than the sum of: (i) the purchase price set forth in the stalking horse Purchase Agreement ($4,623,800); (ii) the Break-Up Fee ($10,000); and (iii) $100,000 (the sum of which will be the initial incremental bid amount) c. Deposit: 5% of the purchase price proposed by the potential bidder d. Auction: The Auction will commence at 11 a.m. (CT) on Nov. 12, 2020, by video conference; provided, however, in the event that no Qualified Bids are received by the Bid Deadline, JDS will not be required to conduct an Auction. Qualified Bidders will receive a calendar invite with the participation instructions. All other interested parties must request the participation instructions at the earliest practicable time, but in no case later than 5:00 p.m. (CT) on Nov. 10, 2020. Requests should be made to rbaran@conroybaran.com / 816.616.5009 or lpittman@conroybaran.com / 816210.9680. e. Bid Increments: $50,000 f. Sale Hearing: Dec. 1, 2020 at 1:30 p.m. (CT) g. Sale Objection Deadline: Nov. 24, 2020 h. 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). JDS is authorized to extend the deadlines set forth in the Order or adjourn, continue, or suspend the Auction or the Sale Hearing for any reason, only by motion for order the Court after five calendar days' notice to Notice Parties and Potential Bidders. The Notice of Auction and Sale Hearing is approved. Within three business days after the entry of the Order, JDS will cause a copy of the Bidding Procedures, the Notice of Auction and Sale Hearing, and the Order to be served upon the Notice Parties as well as the parties that conducted diligence and/or made offers for the Assets. Within three business days after the entry of the Order, JDS will cause a copy of the Notice of Auction and Sale Hearing, and the Order to be served upon the Additional Notice Parties. The Objection Deadline is seven days before the sale hearing. All time periods set forth in the Order will be calculated in accordance with Bankruptcy Rule 9006(a). A copy of the Bidding Procedures is available at https://tinyurl.com/yyozgu96 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 up to $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. JRL FITNESS: Seeks to Hire Latham Luna as Legal Counsel ------------------------------------------------------- JRL Fitness, LLC, seeks approval from the US Bankruptcy Court for the Middle District of Florida to hire the law firm of Latham, Luna, Eden & Beaudine, LLP, as its counsel. The legal services to be provided by the law firm are: (a) advise as to the Debtor's rights and duties in this case; (b) prepare pleadings related to this case, including a plan of reorganization; and (c) take any and all other necessary action incident to the proper preservation and administration of this estate. The standard hourly rates of the firm's attorneys and paralegals are: Experienced attorneys $575 Junior paraprofessionals $105 The hourly rates for the attorneys primarily working on this matter are: Daniel Velasquez $300 Justin Luna $425 Prior to the commencement of this case, the Debtor paid an advance fee of $4,995.50 for pre- and post-petition services and expenses to be incurred in connection with this case. The payment was to satisfy a debt that Akcel Construction owed to Alpha Building Group. The firm received d $3,004.50, on a current basis, for services rendered and costs incurred prior to commencement of this case, including the preparation of the petition for reorganization under Chapter 11 of the Code and all related initial pleadings filed in this case, and prepetition expenses in this case, including the filing fee for the voluntary petition. To the best of Debtor's knowledge, the firm represents no interest adverse to the Debtor or to the estate in matters upon which it is to be engaged, and the employment of the firm would be in the best interest of the estate. The firm can be reached through: Justin M. Luna, Esq. LATHAM, LUNA, EDEN & BEAUDINE, LLP 111 N. Magnolia Avenue, Suite 1400 P.O. Box 3353 (32802-3353) Orlando, FL 32801 Telephone: (407) 481-5800 Facsimile: (407) 481-5801 E-mail: jluna@lathlamluna.com About JRL Fitness, LLC JRL Fitness, LLC, filed its voluntary petition under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-04940) on August 31, 2020, listing under $1 million in both assets and liabilities. Justin M. Luna, Esq. at LATHAM LUNA EDEN & BEAUDINE LLP represents the Debtor as counsel. K & K TECHNOLOGY: Taps James Shepherd as Bankruptcy Counsel ----------------------------------------------------------- K & K Technology Corp. seeks approval from the U.S Bankruptcy Court for the Northern District of California to hire the Law Offices of James Shepherd as its bankruptcy counsel. The firm will render the following legal services: i) assist the initial debtor interview and meeting of creditors conducted by the U.S. Trustee; ii) prepare monthly operating reports; iii) assist all wage, cash collateral, and motions related to other operational issues; iv) assist in handling of contested matters; v) respond to creditor and U.S. Trustee inquiries; vi) assist with ensuring compliance with applicable laws, guidelines and procedures; vii) coordinate with other professionals appointed to represent the Debtor; viii) appear in court proceedings; ix) negotiate confirmation of a Chapter 11 plan and assist with post-confirmation issues; x) perform all services related to the case. On September 8, 2020, Kawaljit Kaur, Debtor's proposed responsible individual, deposited with the firm $2,000 less a third-party transaction fee of $71.15, on behalf of the Debtor. On September 11, 2020, Ms. Kaur deposited an additional $28,000.00 of her funds with the frim on behalf of the Debtor, of which $20,000 is being held in proposed counsel's client trust account as a deposit/retainer for proposed litigation counsel Glen L. Moss of the Moss & Murphy law firm, with the remaining $8,000 being held in trust as a deposit/retainer. James Shepherd, Esq. disclosed in court filings that the firm is a "disinterested person" as defined within Bankruptcy Code section 101(14). The firm can be reached through: James A. Shepherd, Esq. Law Offices of James Shepherd 3000 Citrus Circle, Suite 204 Walnut Creek, CA 94598 Telephone: (925) 954-7554 Facsimile: (925) 281-2341 E-mail: jim@jsheplaw.com About K & K Technology Corp. K & K Technology Corp. is a single asset real estate corporation based in Pleasanton, Calif. K & K Technology sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 20-41366) on August 20, 2020. The petition was signed by Kuldeep Singh, member. At the time of the filing, Debtor had estimated assets of between $1,000,001 and $10 million and liabilities of the same range. K&W CAFETERIAS: Hires Leonard Ryden Burr as Real Estate Broker -------------------------------------------------------------- K&W Cafeterias, Inc., seeks authority from the U.S. Bankruptcy Court for the Middle District of North Carolina to employ Leonard Ryden Burr Real Estate as its broker for the purposes of marketing two parcels of real property. Leonard Ryden will market the following parcels: a. Residential home on Lake Norman, and located at 20703 Pointe Regatta Drive, Cornelius, NC. The Debtor is not aware of any liens or encumbrances with respect to this property, with the exception of accrued 2020 property taxes. The recommended listing price for this property is $1,400,000. b. Undeveloped parcel near Lake Norman, and located at 20221 Sloop Court, Cornelius, NC. The Debtor is not aware of any liens or encumbrances with respect to this property, with the exception of accrued 2020 property taxes. The recommended listing price for this property is $175,000. The Debtor has agreed to pay LRB Real Estate a 5 percent commission at closing. Leonard Ryden Burr is a disinterested person as that term is defined in 11 U.S.C. Sec. 101(14), according to court filings. The firm can be reached through: Molly Allred Leonard Ryden Burr Real Estate 201 S Stratford Rd #200 Winston-Salem, NC 27103 Phone: +1 336-779-9200 About K&W Cafeterias K&W Cafeterias, Inc., based in Winston Salem, NC, filed a Chapter 11 petition (Bankr. M.D.N.C. Case No. 20-50674) on September 2, 2020. The Hon. 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. NORTHEN BLUE, LLP, is the Debtor's counsel. BELL DAVIS & PITT, P.A., is special corporate counsel. CONSTANGY BROOKS SMITH & PROPHETE, LLP, is the special employment counsel. DHG CORPORATE FINANCE, LLC, is the financial advisor. K.G. IM LLC: Secured Lenders Sign Deal to Purchase Assets --------------------------------------------------------- Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York will convene a telephonic hearing on Oct. 15, 2020 at 10:00 a.m. (ET) to consider the bidding procedures proposed by K.G. IM, LLC and its debtor-affiliates in connection with the sale of substantially all assets to BSP Agency, LLC, subject to overbid. The Objection Deadline is Oct. 14, 2020 at 5:00 p.m. (ET). The Debtors commenced these chapter 11 cases to in an effort to stabilize business operations in the face of the global Covid-19 pandemic and assess potential restructuring alternatives. At the commencement of these cases, the Debtors were engaged in a significant dispute with its prepetition secured lenders BSP, and faced with the prospect of expensive, drawn-out litigation. However, the Debtors and BSP were able to settle that dispute. Since that time, the Debtors have engaged in a thorough assessment of its restructuring alternatives, which lead first to intensive negotiations with BSP with respect to potential DIP financing ($3.2 million). Those negotiations ultimately led to discussions over a more holistic approach to the resolution of these bankruptcy cases, with BSP providing a DIP Facility and serving as a stalking horse bidder for a sale process designed to facilitate a value-maximizing restructuring transaction. Importantly, BSP's bid for substantially all of the Debtors' assets includes a commitment to fund various budgeted expenses that will provide for the orderly wind-down of the Debtors' estates and the potential for, among other things, a small recovery for general unsecured creditors. Thus, the baseline set by the Stalking Horse Bid, along with the DIP Facility, ensures that the Debtors will be able to engage in a fulsome sale process to elicit the highest and best offer for their assets and that these chapter 11 cases can be properly administered and wound down thereafter. The Debtors believe that the process represents the best opportunity available to the Debtors to maximize value for the benefit of all stakeholders and entry into the Stalking Horse APA, and asking approval of the Bidding Procedures are sound exercises of their business judgment. The salient terms of the Stalking Horse APA are: a. Buyer: BSP Agency, LLC, Providence Debt Fund III L.P., Benefit Street Partners SMA-C L.P., Benefit Street Partners SMA LM L.P., Providence Debt Fund III Master (Non-US) Fund L.P., and Benefit Street Partners SMA-C SPV L.P, with their permitted successors, designees and assigns. b. Purchase Price: On the terms and subject to the conditions contained herein, the purchase price for the Purchased Assets will consist of: a credit bid in an amount equal to the sum of: (i) $2.2 million consisting of a portion of the outstanding Liabilities under the DIP Facility as of the Closing Date; and (ii) $15.8 million consisting of a portion of the Liabilities arising under, or otherwise relating to, the IL Mulino Prepetition Credit Documents, plus such additional amount as may be credit bid pursuant to the Bidding Procedures Order in connection with the Auction and the Credit Bid and Release whereby Buyer acknowledges the satisfaction of the portion of the DIP Obligations and a portion of the IL Mulino Prepetition Obligations, each as included in the Credit Bid Purchase Price; (iii) the payment or other satisfaction of all Cure Amounts in cash; (iv) the assumption of the Assumed Liabilities; and (v) the payment of $100,000 to be set aside by the Sellers for distribution to holders of allowed general unsecured claims in the Chapter 11 Cases. c. Breakup Fee: $700,000 d. Purchased Assets: All of the, direct or indirect, right, title and interest of Sellers in, to and under the tangible and intangible assets (including goodwill), properties, rights, going concern value, claims and Contracts used, useful, or held for use in, or related to, the Business (but excluding Excluded Assets) wherever situated and of whatever kind and nature, real or personal, as of the Closing. e. Assumption and Assumed Liabilities: All Cure Amounts under any and all Assumed Contracts; all Liabilities under the Assumed Contracts, Assumed Permits from and after the Closing Date as well as any Liabilities to the extent arising exclusively out of the Purchased Assets, in each case, from and after the Closing Date; accounts payable and any open purchase orders, in each case solely to the extent arising exclusively out of the Business, incurred in the Ordinary Course of Business, and solely related to the receipt by the Buyer of goods and services provided to the Buyer following the Closing Date; all accrued payroll, accrued and unused vacation, and accrued payroll Taxes, in each case, after the Closing Date to the extent related exclusively to a Transferred Employee incurred in the Ordinary Course of Business and arising and related to the period following the Closing Date; the Sellers' obligations under the Long Island Mortgage, if assigned to the Buyer; and all Transfer Taxes in accordance with Section 6.5. Additionally, under the Stalking Horse APA, the Debtors will transfer (i) all rights and interests of K.G. IM, LLC, as "Manager" of each Debtor pursuant to the applicable operating agreements, including the management rights and interests vested in the CRO pursuant to the CRO Appointment Order; and (ii) all ownership and/or membership rights of each Debtor in any non-Debtor affiliates free and clear of any restrictions, conditions or limitations in any of the organizational documents governing such management, ownership and/or membership interests. The salient terms of the Bidding Procedures are: a. Bid Deadline: Nov. 16, 2020 at 5:00 p.m. (ET) b. Initial Bid: The value of each Bid must (I) provide a cash component in U.S. dollars that exceeds the aggregate sum of (a) the amount of the Stalking Horse Bid representing the credit bid of a portion of the Prepetition Secured Claims and a portion of the DIP Claims (which aggregate amount is $18 million), (b) the GUC Payment of $100,000 , (c) the Breakup Fee and the Expense Reimbursement (which amount is $1.1 million), (d) $250,000 ("Initial Overbid Amount"), (e) the Cure Amounts; and (f) the Investment Banker Incremental Cash Fee equal to the product of 7.5% multiplied by the excess of the Bid over the Threshold Amount); (II) assume the Assumed Liabilities as provided for in the Stalking Horse APA; and (III) provide substantially similar or better terms than the Stalking Horse Bid. c. Deposit: 10% of the total purchase price d. Auction: Auction, if necessary, to be conducted on Nov. 20, 2020 at 10:00 a.m. (ET) at the offices of Alston & Bird LLP, located at 90 Park Avenue, New York, New York 10016, or such other location, including by virtual meeting, as will be timely communicated to all entities entitled to attend the Auction. e. Bid Increments: $250,000 f. Sale Hearing: Nov. 24, 2020 g. Sale Objection Deadline: Nov. 23, 2020, at 5:00 p.m. (ET) As soon as reasonably practicable, but no later than three business days after entry of the Bidding Procedures Order, the Debtors will serve the Motion, the Sale Hearing, the APA, and the Sale Transaction to the Notice Parties. As soon as reasonably practicable, but no later than five business days after entry of Bidding Procedures Order, the Debtors will publish the Sale Notice, on one occasion, in The New York Times. The Debtors are also asking approval of the Assumption Procedures to facilitate the fair and orderly assumption and assignment of the Assumed Contracts in connection with the Sale. The sale will be free and clear of any and all liens, claims, and encumbrances against the Purchased Assets. To implement the foregoing successfully, the Debtors ask that the Court enters an order providing that notice of the relief requested satisfies Bankruptcy Rule 6004(a) and that the Debtors have established cause to exclude such relief from the 14-day stay period under Bankruptcy Rule 6004(h). An expedited telephonic hearing to consider the interim and final relief sought in the Debtors' Motion for Entry for Entry of Interim and Final Orders (I) Authorizing the Debtors to Obtain Postpetition Financing and to Use Cash Collateral, (II) Granting Adequate Protection to Prepetition Secured Lenders, (III) Confirming the Debtors' Authority to use PPP Funds to Fund Particular Budgeted Items, (IV) Scheduling a Final Hearing, and (V) Granting Related Relief (the ???DIP Motion???) will also be held on Oct. 15, 2020 at 10:00 a.m. (ET). The DIP Motion Objection Deadline is also Oct. 14, 2020 at 5:00 PM. (ET). A copy of the Stalking Horse APA and the Bidding Procedures is available at https://tinyurl.com/y44bcyzm from PacerMonitor.com free of charge. About K.G. IM, LLC K.G. IM, LLC, based in New York, NY, and its affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11723) on July 29, 2020. The Hon. Martin Glenn presides over the case. In the petition signed by Gerald Katzoff, manager, the Debtor was estimated to have $50 million to $100 in assets and $10 million to $50 million in liabilities. ALSTON & BIRD LLP, serves as bankruptcy counsel to the Debtors. TRAXI LLC, and DAVIS & GILBERT LLP, serve as special counsel. KADMON HOLDINGS: To Transfer U.S. Stock Exchange Listing to Nasdaq ------------------------------------------------------------------ Kadmon Holdings, Inc. will voluntarily transfer its stock exchange listing from the New York Stock Exchange to the Nasdaq Global Select Market. The Company will retain the "KDMN" ticker with trading on the Nasdaq expected to begin on Oct. 26, 2020. ??? "Nasdaq is home to an array of leading, innovative biotechnology companies and is a natural fit for Kadmon. We look forward to leveraging Nasdaq's market infrastructure and potentially broadening our exposure to new constituents following our inclusion in the Nasdaq Biotechnology Index," said Harlan W. Waksal, M.D., president and CEO of Kadmon. "We are grateful to the NYSE for their services and support as our listing partner." About Kadmon Holdings Based in New York, Kadmon Holdings, Inc. -- http://www.kadmon.com -- is a clinical-stage biopharmaceutical company that discovers, develops and delivers transformative therapies for unmet medical needs. The Company's clinical pipeline includes treatments for immune and fibrotic diseases as well as immuno-oncology therapies. Kadmon Holdings recorded a net loss attributable to common stockholders of $63.43 million for the year ended Dec. 31, 2019, compared to a net loss attributable to common stockholders of $56.26 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $213.24 million in total assets, $49.98 million in total liabilities, and $163.26 million in total stockholders' equity. BDO USA, LLP, in New York, New York, the Company's auditor since 2010, issued a "going concern" qualification in its report dated March 5, 2020, citing that the Company has incurred recurring losses from operations and expects such losses to continue in the future. These factors raise substantial doubt about the Company's ability to continue as a going concern. KHAN REAL ESTATE: HAB Buying Billings Property for $1.64 Million ---------------------------------------------------------------- Khan Real Estate, LLC, asks the U.S. Bankruptcy Court for the District of Montana to authorize the sale of the real property described as 3311 2nd Avenue North, Billings, Yellowstone County, Montana, known as the Western Inn, to HAB Development Corp. for $1.48 million, and $160,000 for the furnishings, fixtures and equipment located thereon. The parties have executed their Buy-Sell Agreement and Addendum #1. The sale will be free and clear of liens. The sale could close by Oct. 1, 2020, if there is timely Court approval. The Debtor's Chapter 11 Plan of Reorganization will provide for sale of the property. The Debtor has asserted a usury claim against Pender West Credit 1 Reit, LLC in the pending litigation between them. After costs of sale, including commissions and property taxes, the balance remaining due to Debtor will be held in escrow pending resolution of the litigation. The secured creditors will retain their priority liens on the sale proceeds. If the sale is not timely approved, the Debtor's estate may suffer irreparable harm. If the sale is approved, the existing secured creditors will not be harmed and it will put them in a better debt/asset ratio. All other creditors will benefit as well. The following creditors have lien priorities on the subject property: a) Yellowstone County property taxes of approximately $17,322. b) Pender West Credit 1 Reit, LLC of approximately $1,381,340 (disputed). c) Crowley Fleck of approximately $88,000. Yellowstone County will be paid current at the time of sale. The remaining monies will be held in escrow pending Court Order. Accordingly, in the event an objection is filed, the Debtor asks that the Court schedules a hearing on shortened notice relative to its Motion, with regard to the sale of the real property set out in the Buy-Sell Agreement. Pursuant to F.R.B.P. 6004(h), the Debtor also asks that the Order authorizing the sale of the property be effective immediately and not stayed for 14 days. A copy of the Agreement is available at https://tinyurl.com/y4apcazp from PacerMonitor.com free of charge. About Khan Real Estate Khan Real Estate LLC is a single asset real estate (as defined in 11 U.S.C. Section 101(51B)). Its principal assets are located in Billings, Mont., having an appraised value of $1.69 million. Khan Real Estate sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Mont. Case No. 20-10140) on July 27, 2020. The petition was signed by Mansoor A. Khan, member. At the time of the filing, the Debtor disclosed total assets of $1,870,711 and total liabilities of $1,210,322. Judge Benjamin P. Hursh oversees the case. Patten, Peterman, Bekkedahl & Green, PLLC is the Debtor's legal counsel. KIDS FIRST: Seeks to Hire G.L. Milller as Accountant ---------------------------------------------------- KIDS FIRST Swim Schools, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Maryland to hire G. L. Miller & Company, P.A. as its accountant. G.L. Miller will assist with Debtor's monthly bookkeeping and general accounting, tax preparation and filing, and payroll entry. The Debtor requires G.L. Milller to: (a) render tax compliance and tax consulting services to the Debtor; (b) consult with the Debtor and counsel in connection with other business matters relating to the Debtor's financial activities; (c) provide expert testimony as required; (d) work with accountants and other financial consultants, if any; (e) assist with such other tax and financial matters as the Debtor may request from time to time; and (f) provide accounting advice to the Debtor as/when needed in order to assume the continued accuracy of the Debtor's internal accounting records. G.L. Miller will charge $6,300 for preparation of the Debtor's federal and state corporate income tax returns along with composite tax returns for the year ending Dec. 31, 2019. In addition, G.L. Miller will charge $1,750 per month for bookkeeping and payroll services. Gary L. Miller, CPA, owner of G.L. Miller, assures the court that his firm neither represents nor holds any known interest adverse to the Debtor or its estate is a disinterested person under Bankruptcy Code Section 101(14). The firm can be reached through: Gary L. Miller, CPA G L Miller & Company 2219 Conowingo Rd Bel Air, MD 21015 Phone: +1 410-893-8531 About KIDS FIRST Swim Schools Inc. Based in Fallston, Md., KIDS FIRST Swim Schools, Inc. is a provider of year round warm water swimming instruction, operating 37 locations across seven states. Visit https://kidsfirstswimschools.com for more information. KIDS FIRST Swim Schools sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 20-18161) on Sept. 3, 2020. KIDS FIRST President Gary L. Roth signed the petition. At the time of the filing, Debtor had total assets of $7,003,878 and total liabilities of $2,846,065. Yumkas, Vidmar, Sweeney & Mulrenin, LLC is Debtor's legal counsel. KLX ENERGY: Moody's Lowers CFR to Caa1, Outlook Stable ------------------------------------------------------ Moody's Investors Service (Moody's) downgraded KLX Energy Services Holdings, Inc.'s (KLXE) Corporate Family Rating (CFR) to Caa1 from B3, Probability of Default Rating (PDR) to Caa1-PD from B3-PD, senior secured notes rating to Caa1 from B3 and Speculative Grade Liquidity (SGL) rating to SGL-2 from SGL-1. The rating outlook is stable. "KLXE's downgrade reflects its deteriorating leverage metrics amid a challenging operating environment, while operating cash flow improvement is reliant on achieving synergies after combining with Quintana Energy Services," commented Amol Joshi, Moody's Vice President and Senior Credit Officer. Downgrades: Issuer: KLX Energy Services Holdings, Inc. Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Speculative Grade Liquidity Rating, Downgraded to SGL-2 from SGL-1 Corporate Family Rating, Downgraded to Caa1 from B3 Senior Secured Notes, Downgraded to Caa1 (LGD4) from B3 (LGD4) Outlook Actions: Issuer: KLX Energy Services Holdings, Inc. Outlook, Remains Stable RATINGS RATIONALE KLXE's downgrade reflects its deteriorating leverage metrics in a low commodity price environment. While challenging operating conditions have led to high earnings volatility, KLXE's expected combination synergies and good liquidity underpinned by a sizeable cash balance are supportive of its stable rating outlook. KLXE Caa1 CFR reflects its relatively small scale and limited operating history, while providing a range of well completion, intervention and production services in a highly cyclical industry. KLXE relies on exploration and production (E&P) capital spending and activity levels to support its cash flow, while volatility in demand has resulted in significant swings in operating performance. The oilfield services industry is highly competitive and includes some significantly larger companies that have greater financial resources and product diversity. The company has a diversified footprint with a presence in major US onshore producing regions, and the company's cash flow is spread across multiple service offerings. But lower E&P activity has significantly hurt KLXE's revenue, operating income and leverage metrics. KLXE's business has grown through several acquisitions. The company was part of KLX Inc. prior to being spun out in September 2018, and it completed the Motley acquisition towards the end of 2018. The company expects that its combination with Quintana Energy Services, Inc. (QES) completed in late-July should deliver at least $40 million in annualized cost synergies by the second quarter of 2021. KLXE's secured notes are rated Caa1, consistent with its CFR. The company's $100 million ABL revolver is subject to a borrowing base and has a first lien on the ABL collateral including accounts receivable and inventory. The secured notes have a second lien on the ABL collateral and a first lien on most other assets. While the ABL revolver has a first lien on the relatively more liquid ABL collateral, given the proportionately smaller borrowing base of the ABL facility as compared to the secured notes and the low projected utilization of the ABL, the secured notes are rated the same as the CFR. An increasing proportion of ABL relative to secured notes in the capital structure due to factors including a meaningful increase in the borrowing base of the ABL facility or high utilization of the ABL could result in the secured notes rating being below the CFR. The SGL-2 rating reflects Moody's expectation that KLXE will maintain good liquidity based on its cash balance and revolver availability. At July 31, the company had $99 million of cash on its balance sheet. The company also has a $100 million asset-based revolving credit facility maturing in September 2023. The ABL revolver was undrawn and it had $6.3 million of outstanding letters of credit at July 31. Availability under the ABL revolver is reduced when KLXE's fixed charge coverage ratio is less than 1x, and is also constrained by its borrowing base. ABL availability was about $15 million at July 31, and the revolver has no financial maintenance covenants. KLXE secured notes are due in 2025. The stable outlook reflects KLXE's sizeable cash balance supporting good liquidity. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Factors that could lead to a downgrade include EBITDA to interest expense below 1.5x or a deterioration in liquidity. Factors that could lead to an upgrade include growing EBITDA in a stable to improving industry environment, EBITDA to interest expense exceeding 2.5x, maintenance of good liquidity and a conservative financial profile. KLXE is a publicly-traded provider of completion, intervention and production services and products, primarily to E&P companies in major US onshore producing regions. The principal methodology used in these ratings was Global Oilfield Services Industry Rating Methodology published in May 2017. LILIS ENERGY: Court OKs Solicitation of Bankruptcy Plan Votes ------------------------------------------------------------- Alex Wolf of Bloomberg Law reports that Judge Marvin Isgur of the U.S. Bankruptcy Court for the Southern District of Texas approved Chapter 11 plan materials during a telephonic hearing Wednesday, October 14, 2020, following the company's agreement to final disclosure revisions. The plan and accompanying settlement provide general unsecured creditors with a recovery pool between $600,000 and $1 million, depending on the final outcome of a company sale. About Lilis Energy Lilis Energy, Inc. -- https://www.lilisenergy.com/ -- is a publicly-traded, independent oil and natural gas company focused on the exploration, development, production, and acquisition of crude oil, natural gas, and natural gas liquids. Headquartered in Fort Worth, Texas, Lilis is a pure play Permian Basin company with focused operations in the Delaware Basin. Lilis Energy and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 20-33274) on June 28, 2020. As of Dec. 31, 2019, the Debtors had total assets of $258.6 million and total liabilities of $251.2 million. Judge David R. Jones oversees the cases. The Debtors tapped Vinson & Elkins, LLP as legal counsel; Barclays Capital, Inc., as investment banker and financial advisor; BDO, USA LLP as accountant and tax advisor; and Stretto as notice, claims and solicitation agent. LILIS ENERGY: Mineral Lienholders Object to Disclosure Statement ---------------------------------------------------------------- Bell Supply Company, LLC; Bronco Oilfield Services, Inc.; Cudd Pressure Control, Inc.; Culberson Construction, LLC; Newpark Drilling Fluids, LLC; PCS Ferguson, Inc.; Peak Oilfield Services, LLC; QES Wireline LLC; Select Energy Services, LLC; and Thru Tubing Solutions, Inc. (collectively, Mineral Lienholders) files this limited objection and reservation of rights to the Disclosure Statement for the Proposed Joint Liquidating Chapter 11 Plan of Lilis Energy, Inc., and its Debtor Affiliates. Mineral Lienholders claim that the Disclosure Statement fails to contain adequate information to allow creditors to make an informed choice regarding the Plan. Specifically, it lacks the following: * The Disclosure Statement makes sweeping statements that creditors would receive less in a Chapter 7 liquidation; however, the referenced Liquidation Analysis at Exhibit D is blank; * The Disclosure Statement fails to address the need for a determination of mineral lien validity and priority, and fails to provide different treatment for the Mineral Lienholders separate from the general unsecured creditors; * The Mineral Lienholders object to any inference that might suggest a waiver of priority, especially because there has never been any effort to determine the validity, priority or effectiveness of the liens filed by trade creditors; * The Disclosure Statement lacks information relating to any funds the Debtors may have received from non-operating working interest owners, and of equal importance, any funds that remain payable to Debtors but were withheld as a result of pre-lien notice letters to non-operating working interest owners; and * The Disclosure Statement at Section 11, page 57/106 states that there may be significant plugging and abandonment liability as a result of the Sales Process without providing any estimate of this exposure. A full-text copy of the Mineral Lienholders' objection to the disclosure statement dated October 1, 2020, is available at https://tinyurl.com/y43mvnlx from PacerMonitor.com at no charge. Attorneys for the Mineral Lienholders: DORE ROTHBERG MCKAY, P.C. Carl Dor??, Jr. Allyson Sasha Johnson 17171 Park Row, Suite 160 Houston, Texas 77084 Tel: (281) 829-1555 Fax: (281) 200-0751 E-mail: cdore@dorelaw.com ajohnson@dorelaw.com About Lilis Energy Lilis Energy, Inc. -- https://www.lilisenergy.com/ -- is a publicly-traded, independent oil and natural gas company focused on the exploration, development, production, and acquisition of crude oil, natural gas, and natural gas liquids. Headquartered in Fort Worth, Texas, Lilis is a pure play Permian Basin company with focused operations in the Delaware Basin. Lilis Energy and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 20-33274) on June 28, 2020. As of Dec. 31, 2019, the Debtors had total assets of $258.6 million and total liabilities of $251.2 million. Judge David R. Jones oversees the cases. The Debtors tapped Vinson & Elkins, LLP as legal counsel; Barclays Capital, Inc., as investment banker and financial advisor; BDO, USA LLP as accountant and tax advisor; and Stretto as notice, claims and solicitation agent. LILIS ENERGY: Plaintiffs Say Disclosures Misleading --------------------------------------------------- ARM Energy Management LLC, Salt Creek Midstream, LLC, SCM Water, LLC and SCM Crude, LLC (and collectively with ARM Energy, Salt Creek and SCM Water, the "Plaintiffs") file this Objection to Disclosure Statement for Lilis Energy, Inc., et al's Proposed Joint Liquidating Chapter 11 Plan. The Plaintiffs object to the approval of the Disclosure Statement on the grounds that it does not contain adequate information to allow a reasonable creditor to cast an informed vote, as required by section 1125 of the Bankruptcy Code. Plaintiffs point out that: * While the Disclosure Statement does include some discussion regarding the Contracts and the Adversary Proceeding, that discussion is misleading because it is one-sided and because it omits material information necessary to making an informed decision. * The deficiency is not because the Disclosure Statement describes the Contracts in a manner that is favorable to the Debtors. That is to be expected. What is improper and materially misleading is the Disclosure Statement's failure to make any mention of the Plaintiffs' positions in the Adversary Proceeding, such as the existence of covenants running with the land under the Dedications and the wrongful termination of the Firm Sales Contract. * The Debtors are unable to establish any of the Metrocraft factors. COUNSEL TO ARM ENERGY MANAGEMENT LLC, SALT CREEK MIDSTREAM LLC, SCMWATER, LLC AND SCM CRUDE LLC: Mark D. Sherrill David A. Baay Garrett A. Gibson EVERSHEDS SUTHERLAND (US) 1001 Fannin Street Suite 4300 Houston, Texas 77002 Tel: (713) 470-6100 Fax: (713) 637-3593 marksherrill@eversheds-sutherland.com davidbaay@eversheds-sutherland.com garrettgibson@eversheds-sutherland.com About Lilis Energy Lilis Energy, Inc. -- https://www.lilisenergy.com/ -- is a publicly-traded, independent oil and natural gas company focused on the exploration, development, production, and acquisition of crude oil, natural gas, and natural gas liquids. Headquartered in Fort Worth, Texas, Lilis is a pure play Permian Basin company with focused operations in the Delaware Basin. Lilis Energy and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 20-33274) on June 28, 2020. As of Dec. 31, 2019, the Debtors had total assets of $258.6 million and total liabilities of $251.2 million. Judge David R. Jones oversees the cases. The Debtors tapped Vinson & Elkins, LLP as legal counsel; Barclays Capital, Inc., as investment banker and financial advisor; BDO, USA LLP as accountant and tax advisor; and Stretto as notice, claims and solicitation agent. LIQUIDNET HOLDINGS: Moody's Puts Ba3 CFR on Rating Review --------------------------------------------------------- Moody's Investors Service placed Liquidnet Holdings, Inc.'s ratings on review with direction uncertain, including the firm's Ba3 corporate family rating (CFR) and Ba3 senior secured term loan rating. This follows the October 9 announcement by TP ICAP plc (TP ICAP, unrated) that it has agreed to acquire Liquidnet for a price between $575 million and $700 million. Issuer: Liquidnet Holdings, Inc. Placed on review direction uncertain: Corporate Family Rating, currently Ba3 Senior Secured 1st Lien Term Loan, currently Ba3 Outlook Actions: Issuer: Liquidnet Holdings, Inc. Outlook, Changed to Rating Under Review from Negative RATINGS RATIONALE / FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's has initiated a review of Liquidnet's ratings following TP ICAP's announcement that it intends to acquire Liquidnet. The transaction could have positive and negative ratings implications and the review is to assess the effects of the transaction and ownership change on Liquidnet's financial profile and strategy. Liquidnet's successful business model has benefited from its independence and ability to service its members and trade anonymously on the firm's network. Being part of TP ICAP, dealers and clients would be trading on venues owned by one of the largest interdealer brokers, resulting in potential conflicts and client retention challenges, leading to possible adverse revenue implications. During its review, Moody's will seek additional understanding of the effects of the proposed transaction on Liquidnet's creditworthiness, potential impact on member retention, and potential support from the company's new owners. TP ICAP's agreement is to acquire Liquidnet for a price between $575 million and $700 million. The upper end of the acquisition price includes up to $125 million in payments contingent upon performance targets at Liquidnet's equities business and payable after three years from transaction close. Moody's said that Liquidnet's credit agreement contains mandatory prepayment clauses resulting in full repayment of the firm's debt balance ($120 million as of June 2020) upon successful close of the acquisition, which TP ICAP expects to complete in the first quarter of 2021. Subsequent to the successful closing of the transaction, Moody's will withdraw Liquidnet's senior secured loan rating. Liquidnet's credit profile reflects the firm's reliance on trading volumes which could exert volatility on its revenue and profitability, especially when volumes are down and during periods of growth when expense management could be limited. Moody's also noted that this reliance on trading volumes had a positive impact when volatility spiked during the first quarter of 2020, resulting in record revenue for Liquidnet. The ratings could be upgraded if Moody's were to assess that on a combined basis, the firm's creditworthiness would benefit from the combined operations through the larger combined scale and without substantial adverse effect on client relationships and revenue. The ratings could also be upgraded should EBITDA margins improve on a sustainable basis and the firm is able to manage through periods of reduced revenue by nimbly altering its cost base. The ratings could be downgraded if Moody's were to assess that the new ownership would weaken Liquidnet's credit profile, resulting in long-lasting member retention issues. The ratings could also be downgraded should transaction revenue decline via a reduction in member trading volumes or if a change in financial policy occurs towards favoring increased debt leverage or shareholder distributions Moody's would confirm Liquidnet's ratings if it assesses that the credit impact of being part of TP ICAP is neutral. Liquidnet is a privately-held regulated broker-dealer that designs, develops and operates alternative trading systems and electronic marketplaces that facilitate equity and fixed income securities trading for institutional investors worldwide. TP ICAP is the world's largest voice interdealer broker. The company acts as an intermediary and data provider in wholesale financial, energy, and commodity markets, facilitating the trading activities of institutional clients, including dealers, banks, asset managers, and hedge funds, across a wide range of products. The principal methodology used in these ratings was Securities Industry Service Providers Methodology published in November 2019. LIQUIDNET HOLDINGS: S&P Places 'BB-' ICR on Watch Positive ---------------------------------------------------------- S&P Global Ratings placed its 'BB-' issuer credit and senior secured debt ratings on Liquidnet Holdings Inc. on CreditWatch with positive implications. "We are placing the ratings on CreditWatch positive to reflect the potential benefit to Liquidnet of it being acquired by the larger and more diversified TP ICAP, the London-based largest inter-dealer broker. Further, we believe that the acquisition will involve the repayment of Liquidnet's existing rated senior unsecured debt, improving Liquidnet's financial risk profile," S&P said. "At the same time, the CreditWatch listing reflects uncertainty as to the combined group's overall creditworthiness and Liquidnet's importance to the TP ICAP group after the close," the rating agency said. S&P recognizes the benefit of the combined group's improved scale and diversification from the combination of TP ICAP's larger organization and interdealer franchise with Liquidnet's predominantly buy-side crossing business. However, S&P also believes that there is a risk that putting the buy-side and the sell-side businesses together could put off some of either firm's clients. The need to manage this risk could lead to Liquidnet being operated somewhat separately, which could result in S&P considering it more of a strategic than a core part of the TP ICAP group. "We expect to resolve the CreditWatch by assessing the creditworthiness of the combined Liquidnet-TP ICAP, and Liquidnet's role and importance to the resulting larger group," S&P said. LOS ANGELES SCHOOL: Seeks to Hire Kogan Law as Bankruptcy Counsel ----------------------------------------------------------------- Los Angeles School of Gymnastics, Inc. seeks approval from the U.S. Bankruptcy Court for the Central District of California to hire Kogan Law Firm, APC as its bankruptcy counsel. The firm will perform the following services: (a) advise the Debtor regarding matter of bankruptcy law; (b) advise the Debtor with respect to its rights, powers, duties and obligations; (c) assist the Debtor with respect to compliance with the requirements of the U.S. Trustee; (d) represent the Debtor in any court proceedings or hearings; (e) prepare legal papers; (f) assist the Debtor in the implementation of a Chapter 11 reorganization plan and all matters relating thereto; and (g) perform any and all legal services. The firm received a prepetition retainer from the Debtor in the amount of $21,717. Michael S. Kogan, Esq., who will mainly provide the legal services, will be paid at an hourly rate of $600, and the associate who works on his matters will be billed at $350 per hour. The firm's paralegals are billed at an hourly rate of $200-$300. Mr. Kogan disclosed in court filings that the firm does not hold or represent any interest adverse to the Debtor's estate. The firm can be reached through: Michael S. Kogan, Esq. Kogan Law Firm, APC 1849 Sawtelle Blvd., Suite 700 Los Angeles, CA 90025 Telephone: (310) 954-1690 E-mail: mkogan@koganlawfirm.com About Los Angeles School of Gymnastics, Inc. Los Angeles School of Gymnastics, Inc. offers gymnastics programs for kids. The school has served families with gymnastics instruction, innovative programs and well-rounded curriculum supporting children since 1975. Visit https://www.lagymnastics.com for more information. Los Angeles School of Gymnastics sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 20-18203) on September 8, 2020. The petition was signed by Tanya Berenson, chief executive officer. At the time of the filing, Debtor had estimated assets of between $500,000 and $1 million and liabilities of between $1 million and $10 million. Judge Deborah J. Saltzman oversees the case. Kogan Law Firm, APC is Debtor's legal counsel. LUCKY TEETH: Seeks to Hire Edwards & Associates as Accountant ------------------------------------------------------------- Lucky Teeth Pediatric Dentistry PLLC seeks approval from the U.S. Bankruptcy Court for the Eastern District of Texas to hire Edwards & Associates as its accountant. The firm will render the following accounting and financial advisory services: a. assist the Debtor in the analysis of the Debtor's financial position, assets, and liabilities; b. assist the Debtor in the accounting of all receipts and disbursement from the estate and the preparation of all reports; c. assist the Debtor in the development of a plan of reorganization and in the preparation of a disclosure statement; d. assist the Debtor in the preparation of a final report and final accounting of the administration of the estate; e. perform all other accounting and financial advisory services. The compensation to be paid to Edwards & Associates shall be $300 per hour for Robert Edwards, CPA and $125 per hour for staff. Mr. Edwards disclosed in court filings that the firm is a "disinterested person" as such term is defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Robert Edwards, CPA Edwards & Associates 17060 Dallas Parkway, Suite 200 Dallas, TX 75248 Telephone: (972) 267-9191 About Lucky Teeth Pediatric Dentistry Lucky Teeth Pediatric Dentistry PLLC filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tex. Case No. 20-41794) on August 20, 2020, listing under $1 million in both assets and liabilities. Joyce W. Lindauer Attorney, PLLC serves as the Debtor's counsel. MAD RIVER: U.S. Trustee Appoints Creditors' Committee ----------------------------------------------------- The U.S. Trustee for Region 17 appointed a committee to represent unsecured creditors in the Chapter 11 case of Mad River Estates, LLC. The committee members are: 1. Clinton Wiley P.O. Box 667 Redway, CA 95560 Phone: (707) 496-4684 cwmadriverestates@gmail.com Counsel: Steven M. Spector, Esq. Buchalter 1000 Wilshire Blvd., Suite 1500 Los Angeles, CA 90017 Phone: (213) 891-5008 sspector@buchalter.com 2. Matt Leaidicker 1884 Allard Avenue, #38 Eureka, CA 95501 Phone: (209) 753-8097 mleaidicker@gmail.com Counsel: Steven M. Spector, Esq. Buchalter 1000 Wilshire Blvd., Suite 1500 Los Angeles, CA 90017 Phone: (213) 891-5008 sspector@buchalter.com 3. Redwook Coast Fuel Attn: Michael Sahlbach 3471 N. State Street Union, CA 95482 Phone: (707) 234-4599 Michael@barbicuitrading.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 Mad River Estates LLC Mad River Estates, LLC is a Korbel, Calif.-based company engaged in activities related to real estate. Mad River Estates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Cal. Case No. 20-10470) on Aug. 14, 2020. At the time of the filing, Debtor had estimated assets of between $1 million to $10 million and liabilities of the same range. Dean Bornstein, the company's manager, signed the petition. Judge William J. Lafferty oversees the case. Paul A. Beck, APC is Debtor's legal counsel. MALLINCKRODT PLC: S&P Lowers ICR to 'D' on Chapter 11 Filing ------------------------------------------------------------ S&P Global Ratings lowered its long-term issuer credit rating and all of its issue-level ratings on Mallinckrodt PLC to 'D'. S&P intends to reevaluate its ratings when the company emerges from the Chapter 11 proceedings. S&P lowered its ratings on Mallinckrodt PLC to 'D', including its long-term issuer credit rating and issue-level ratings, due to its recent filing of Chapter 11 petitions that include the parent entity, substantially all of its U.S. subsidiaries, and certain international subsidiaries. The company intends to use the Chapter 11 process to reduce its debt balance and resolve its opioid-related litigation and Acthar Gel-related disputes. The company reported that a number of parties have agreed in principle to a restructuring support agreement (RSA), including 84% of its unsecured debtholders, 50 states and territories, and the court-appointed plaintiffs' executive committee for the opioid multidistrict litigation (MDL). The proposed plan includes a $1.6 billion payment to the opioid claimants over seven years in a front-loaded structure. In addition, it includes a $260 million payment related to its Acthar Gel sales with Medicaid over seven years. The restructuring plan proposes to reinstate the current first- and second-lien loans and bonds at their existing rates and maturities. The guaranteed unsecured noteholders (currently about $1.65 billion of principal outstanding) would receive a pro rata share of $375 million of new second-lien notes and essentially all of the common equity. The proposed plan would provide no recovery to the non-guaranteed unsecured noteholders and common equity holders. MALLINCKRODT PLC: Top Creditors Oppose Its Chapter 11 Strategy -------------------------------------------------------------- Law360 reports that a top Mallinckrodt PLC lender group warned Wednesday, October 14, 2020, that it opposes the bankrupt global drugmaker's "flawed" plan to shed $1 billion of its debt in a Delaware Chapter 11 that also seeks nearly $2 billion in multiyear settlements for opioid suits and other claims. Scott J. Greenberg, counsel to the drug company's ad hoc group of first-lien term lenders, told U. S. Bankruptcy Judge John T. Dorsey in a hearing that Mallinckrodt's $5. 3 billion debt restructuring was developed with "zero input" from his group, made up of Mallinckrodt's largest and most-senior lenders. Greenberg's summary was among several speed bumps raised by attorneys representing groups involved. 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. MANZANA CAPITAL: Hires Strom Commercial as Real Estate Agent ------------------------------------------------------------ Manzana Capital, Inc., seeks authority from the U.S. Bankruptcy Court for the Southern District of California to employ Strom Commercial Real Estate to represent it in the sale of the C Street property during its Chapter 11 proceeding. Prior to filing the instant case the Debtor had entered into a real estate sales listing agreement with Strom Commercial Real Estate to sell the Debtor???s real property located at 2504 C Street, San Diego, California. Strom Commercial's commission will be 6 percent of the purchase price if outside broker represents the Buyer, 4.5 percent of the purchase price if Strom Commercial acts as dual agent and the Buyer has not previously engaged with the Owner, or 2 percent of the purchase price if the Buyer has engaged with the Owner and Strom Commercial acts as dual agent. To the best of the Debtor's knowledge, information and belief, Strom Commercial Real Estate has no other connection with the Debtor, creditors, any other party in interest, their respective attorneys and accountants, the United States trustee, or any person employed in the office of the United States trustee, and is otherwise disinterested in these proceedings. The firm can be reached through: Joe Vergilio Strom Commercial Real Estate 675 G Street San Diego, CA 92101 Phone: 619-243-1244 Fax: 619-243-1246 About Manzana Capital Manzana Capital, Inc., filed a Chapter 11 bankruptcy petition Bankr. S.D. Cal. Case No. 20-04045) on Aug. 10, 2020, disclosing under $1 million in both assets and liabilities. The Debtor hired Daniel Masters, Esq., as counsel. MARTIN DEVELOPMENT: Seeks to Hire Parker & Associates as Counsel ---------------------------------------------------------------- Martin Development, LLC, and its affiliates seek approval from the U.S. Bankruptcy Court for the District of Massachusetts to hire Parker & Associates LLC as their bankruptcy counsel. The firm will render the following legal services: (i) advise the Debtors with respect to their rights and duties; (ii) prepare requisite schedules and statements of financial affairs; (iii) represent the Debtors at all hearings; (iv) prepare all legal papers and review all financial and other reports to be filed in the Chapter 11 proceedings; (v) review the nature and validity of any liens asserted against the Debtors' properties; (vi) review the claims against the Debtors, the treatment of such claims and the preparation of any objections to claims; (vii) perform all other legal services to the Debtors. The firm will seek compensation based upon its normal and usual hourly billing rates, and reimbursement of expenses incurred on behalf of the Debtors. The firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, according to a court filing. Parker & Associates can be reached through: Nina M. Parker, Esq. Marques C. Lipton, Esq. Parker & Lipton Parker & Associates LLC 10 Converse Place, Suite 201 Winchester, MA 01890 Telephone: (781) 729-0005 E-mail: nparker@parkerlipton.com mlipton@parkerlipton.com About Martin Development, LLC, Martin Development, LLC is a freight shipping broker based in North Andover, Mass. On September 23, 2020 Martin Development and its affiliates filed voluntary Chapter 11 petitions (Bankr. D. Mass. Lead Case No. 20-40935). The petitions were signed by David M. Martin, manager. At the time of the filings, Martin Development had estimated assets of between $1 million and $10 million and liabilities of the same range. Judge Elizabeth D. Katz oversees the case. Debtors are represented by Parker & Lipton. MRO HOLDINGS: S&P Affirms 'B' ICR; Outlook Negative --------------------------------------------------- S&P Global Ratings affirmed all of its ratings on aircraft maintenance provider MRO Holdings Inc. (MROH), including the 'B' issuer credit rating. The negative outlook reflects S&P's concern over a recovery in demand for MROH's services as a result of the coronavirus pandemic. S&P expects MROH's credit metrics to be weak in 2020, but recover in 2021. As a result of lower air traffic because of the coronavirus pandemic, S&P expects demand for MROH's maintenance, repair, and overhaul (MRO) services to be down significantly in 2020. Commercial airlines are delaying maintenance as most of their fleets remain grounded. This will result in lower revenue and earnings for MROH, weakening its credit metrics. S&P expects some recovery commercial air travel in 2021, as travel restrictions lessen, a vaccine likely becomes available, and companies return to more normal operations with business travel. The rating agency also expects that MROH will gain a larger market share due to its lower-cost services. S&P expects debt to EBITDA to be above 8x in 2020 due to lower earnings, but to improve below 6x in 2021 as demand recovers. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety The negative outlook reflects S&P's expectation that MROH's credit metrics, which will likely weaken materially due to the pandemic in 2020, may not recover as S&P expects next year. The rating agency now expects debt to EBITDA to be above 8x in 2020, but to recover to below 6x in 2021. "We could lower our ratings on the company over the next 12 months if we believe the impact on earnings and free cash flow from the coronavirus will be greater than we currently expect, resulting in debt to EBITDA remaining above 7x or sustained negative free cash flow that constrains liquidity," S&P said. "We could revise our outlook on MROH to stable if the company maintains debt to EBITDA of around 5x and break-even free cash flow. This would likely be the result of a quicker-than-expected recovery in maintenance demand," the rating agency said. NEFFGEN FAMILY: Hires Terry to Liquidate Store/Warehouses Inventory ------------------------------------------------------------------- Neffgen Family Stores, LLC, asks the U.S. Bankruptcy Court for the District of South Carolina to authorize it to hire Terry Howe & Associates as its Liquidator to liquidate the inventory and other assets in the Hendersonville, North Carolina store and the warehouses on Bramlett Road and Rutherford Road in South Carolina. A hearing on the Motion is set for Nov. 3, 2020, 10:30 a.m. Objections, if any, must be filed within 21 days of service of the notice. The Debtor owns a number of Family Stores that contain approximately 1.3 million items of inventory. Its business model is similar to its competitors such as "One Dollar Stores," "Dollar General Stores," etc. Both prior to the filing of its bankruptcy petition, and subsequent thereto, the Debtor closed certain of its stores, and moved all assets from those closed stores to a warehouse and/or stores that remained open. It decided to maintain the following stores, which remained open: Greenville, Spartanburg, and Duncan, South Carolina, plus a store in Hendersonville, North Carolina. The Debtor also decided to close one of two warehouses in Greenville, South Carolina, and maintain the larger warehouse in that city. The purpose of the Debtor's a petition under chapter 11 of the Code was to reorganize its financial commitments. The intent to liquidate the inventory and the search for a liquidator is discussed in the disclosure statement. While preparing the plan and disclosure statement, the counsel for the Debtor mentioned to Al Neffgen, the sole owner and managing member, that a company known as Terry Howe is a local liquidator that has been approved by the Court on a number of occasions for the purpose of liquidating business assets for bankruptcy trustees. Both agreed to contact the company and discuss options with its members. Those discussions "on the record" at that hearing included selling assets of the two warehouses and the Hendersonville, North Carolina store as those parties did not object. The counsel for the debtor in possession agreed, of course, that Terry Howe would need to be employed as professionals to undertake that endeavor. The Debtor now asks the Court to allow Terry Howe to liquidate the inventory and other assets in the Hendersonville, North Carolina store and the warehouses on Bramlett Road and Rutherford Road in South Carolina. Exhibit A is the copy of said inventory and description of other assets. The plan for liquidating assets by Terry Howe is described on Exhibit B. The Debtor has filed a separate Application to Employ Terry Howe & Associates as professionals. The Debtor asks the Court to review the matter, schedule a hearing after notice, and enter its order granting the relief sought. About Neffgen Family Stores Neffgen Family Stores, LLC is a seller of home goods with various locations in upstate South Carolina. Neffgen Family Stores sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. S.C. Case No. 20-00571) on Feb. 1, 2020. At the time of the filing, the Debtor had estimated assets of between $500,000 and $1 million and liabilities of between $1 million and $10 million. Judge Helen E. Burris oversees the case. The Debtor is represented by The Cooper Law Firm. NEPHROS INC: Lends $1.3 Million to Subsidiary for Clinical Trial ---------------------------------------------------------------- Nephros, Inc., entered into a loan agreement with Specialty Renal Products, Inc., a majority-owned subsidiary of the Company. The purpose of the Loan Agreement is to allow SRP to fund the preparation and submission to the FDA of SRP's hemodialysis filtration product for 510(k) clearance and to conduct clinical trial and commercial launch activities for SRP's HDF product. The Loan Agreement allows SRP to borrow up to $1,258,555 from the Company pursuant to a Convertible Promissory Note. As of Oct. 7, 2020 (the date of entry into the Loan Agreement), the Company has already made a disbursement of $758,555 to SRP. Further disbursements of up to $500,000 may be made upon written request from SRP to the Company until the Commitment Period Expiration Date, which is the earlier of (i) the date on which an Event of Default (as defined in the Loan Agreement) occurs, or (ii) Nov. 30, 2021. Simple interest will accrue daily on the unpaid principal balance of the amounts funded under any disbursement commencing on the date such disbursement is made and continuing until repaid or converted in full at a rate per annum equal to 8.00%. If SRP fails to make any payment of principal or interest with respect to the loan, SRP shall pay, in respect of the outstanding principal amount and interest of the loan, interest at the rate per annum equal to the interest rate plus 4.00% for so long as such payment remains outstanding. Such interest will be payable on demand. Upon the occurrence of a Financing Event (as defined in the Loan Agreement) in which SRP sells $2,000,000 or more of New Securities (as defined in the Loan Agreement), the Company shall have the right to convert all or a portion of the loan balance into that number of shares or units of New Securities sold by SRP determined by dividing the Conversion Amount by the Conversion Price, each as defined in the Loan Agreement. In the case of conversion, all rights of the Company with respect to such Conversion Amount shall terminate. The Loan Agreement contains customary affirmative covenants and customary covenants that limit the ability of SRP and its subsidiaries to, among other things, merge into or consolidate with another entity, sell its assets other than in the ordinary course of its business, change its state of incorporation, guarantee or otherwise become liable for obligations of any third party, or grant or permit to exist any other security interest or lien in any of SRP's assets. The Loan Agreement contains customary events of default, such as the failure to pay obligations when due, SRP's failure to perform its obligations under the Loan Agreement, initiation of bankruptcy or insolvency proceedings, or one or more judgments against SRP, which in the aggregate exceed $100,000. Upon an event of default, the Company may, subject to customary cure rights, require the immediate payment of all amounts outstanding under the Loan Agreement. About Nephros Inc. River Edge, N.J.-based Nephros, Inc., is a commercial stage medical device company that develops and sells high performance liquid purification filters. Its filters, which are generally classified as ultrafilters, are primarily used in hospitals for the prevention of infection from water-borne pathogens, such as legionella and pseudomonas, and in dialysis centers for the removal of biological contaminants from water and bicarbonate concentrate. Nephros reported a net loss of $3.18 million for the year ended Dec. 31, 2019, compared to a net loss of $3.33 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $16.65 million in total assets, $4.37 million in total liabilities, and $12.27 million in total stockholders' equity. NEW HOME CO: S&P Rates New $250MM Senior Unsecured Notes 'B-' ------------------------------------------------------------- S&P Global Ratings assigned its 'B-' issue-level and '3' recovery ratings to The New Home Co. Inc.'s proposed $250 million senior unsecured notes due 2025. The '3' recovery rating indicates S&P's expectation for meaningful (50%-70%; rounded estimate: 50%) recovery in the event of payment default. S&P expects the company to use the proceeds from this offering and cash on hand to fund the redemption of all $292 million of its outstanding existing notes due in 2022 and to pay related fees and expenses. NICE SERVICES: Taps Steven M. Fishman as Bankruptcy Counsel ----------------------------------------------------------- Nice Services, Inc. seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Steven M. Fishman, P.A. as its bankruptcy counsel. The firm will render the following professional services: a. advise the Debtor with regard to its powers and duties; b. prepare legal documents required by the court; c. give the Debtor legal advice with respect to its powers and duties; d. advise the Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements; e. prepare legal papers and appear at court hearings; f. protect the interest of the Debtor in all matters pending before the court; g. litigate Adversary Proceeding 8:19-bk-00427-MGW; h. represent the Debtor in negotiation with its creditors in the preparation of the Chapter 11 plan, if necessary; and i. perform all other bankruptcy related legal services. The firm will be paid on an hourly basis for services rendered at the standard rates which range from $350/hour for the services rendered by Steven M. Fishman, Esq., $150/hour for assistant attorney, and $75/hour for services rendered by paralegal services. The retainer agreed upon was $17,000 and $500 costs. Steven M. Fishman, Esq. disclosed in court filings that the firm does not represent or hold any interest adverse to the Debtor or its estate. The firm can be reached through: Steven M. Fishman, Esq. Steven M. Fishman, P.A. 2454 McMullen Booth Road, Suite D-607 Clearwater, FL 33759 Telephone: (727) 724-9044 E-mail: steve@attorneystevenfishman.com About Nice Services Inc. Nice Services, Inc. is a privately held company headquartered in Tampa, Fla. Nice Service filed for Chapter 11 bankruptcy protection (Bankr. M.D. Fla. Case No. 19-04386) on May 9, 2019. At the time of the filing, the Debtor estimated $1 million to $10 million in both assets and liabilities. Thomas C. Little, P.A., led by founding partner Thomas C. Little, is serving as the Debtor's counsel. NSHE CA BULLS: Taps Dalton Real Estate as Real Estate Broker ------------------------------------------------------------ NSHE CA Bulls, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of California to hire Dalton Real Estate as its real estate broker. Dalton Real Estate will assist the Debtor in the sale of its real property located at 6392 Camino de la Costa in La Jolla, Calif. The broker will be paid a flat fee of $149. Emmett Dalton, a principal at Dalton Real Estate, disclosed in court filings that the firm is a "disinterested person" as such term is defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Emmett Dalton Dalton Real Estate 2109 Montrose Dr Thousand Oaks, CA 91362 Telephone: (805) 496-6132 E-mail: steve@attorneystevenfishman.com About NSHE CA Bulls LLC NSHE CA Bulls, LLC is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). NSHE CA Bulls sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Cal. Case No. 19-07519) on Dec. 17, 2019. At the time of the filing, Debtor had estimated assets of between $10 million and $50 million and liabilities of between $1 million and $10 million. Judge Laura S. Taylor oversees the case. Debtor has tapped The Law Offices of Kit J. Gardner as its legal counsel, and 3C Advisors, LLC and Anderson Appraisal Services, Inc. as its consultants. On March 16, 2020, Debtor filed its Chapter 11 plan, which proposes to pay unsecured creditors in full. OLDSMAR JJ: Seeks to Hire Steven M. Fishman as Bankruptcy Counsel ----------------------------------------------------------------- Oldsmar JJ, LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Steven M. Fishman, Esq. and the law firm of Steven M. Fishman, P.A. as its bankruptcy counsel. The firm will render the following professional services: a. analyze the financial situation, and render advice and assistance to the Debtor in determining whether to file a petition under Title 11, United States Code; b. advise the Debtor with regard to its powers and duties; c. prepare legal documents required by the court; d. represent the Debtor at the Section 341 Creditors' meeting; e. give the Debtor legal advice with respect to its powers and duties; f. advise the Debtor with respect to its responsibilities in complying with the U.S. Trustee's Operating Guidelines and Reporting Requirements; g. prepare legal papers and appear at hearings; h. protect the interest of the Debtor in all matters pending before the court; i. represent the Debtor in negotiation with its creditors in the preparation of the Chapter 11 Plan; and j. perform all other bankruptcy related legal services. The firm will be paid on an hourly basis for services rendered at the standard rates which range from $350/hour for the services rendered by Steven M. Fishman, Esq., $150/hour for assistant attorney, and $75/hour for services rendered by paralegal services. The retainer agreed upon was $10,000 and $2,500 costs. Steven M. Fishman, Esq. disclosed in court filings that the firm does not represent or hold any interest adverse to the Debtor or its estate. The firm can be reached through: Steven M. Fishman, Esq. Steven M. Fishman, P.A. 2454 McMullen Booth Road, Suite D-607 Clearwater, FL 33759 Telephone: (727) 724-9044 E-mail: steve@attorneystevenfishman.com About Oldsmar JJ, LLC Oldsmar JJ, LLC is an Oldsmar, Fla.-based privately held company in the fast-food & quick-service restaurants business. Oldsmar JJ sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 20-07204) on September 26, 2020. The petition was signed by Scott Zieba, managing member. At the time of the filing, Debtor had estimated assets of between $100,000 and $500,000 and liabilities of between $1 million and $10 million. Steven M. Fishman, PA is Debtor's legal counsel. OLIYAN TACOS: Hires DeMarco-Mitchell as General Counsel ------------------------------------------------------- Oliyan Tacos, LLC, seeks authority from the US Bankruptcy Court for the Eastern District of Texas to hire DeMarco-Mitchell, PLLC, as its counsel. The Debtor requires DeMarco-Mitchell to: a. take all necessary action to protect and preserve the Estate, including the prosecution of actions on its behalf, the defense of any actions commenced against it, negotiations concerning all litigation in which it is involved, and objecting to claims; b. prepare on behalf of the Debtor all necessary motions, applications, answers, orders, reports, and papers in connection with the administration of the estate; c. formulate, negotiate, and propose a plan of reorganization; and d. perform all other necessary legal services in connection with these proceedings. DeMarco-Mitchell's hourly rates are: Robert T. DeMarco $350 Michael S. Mitchell $300 Barbara Drake $125 DeMarco-Mitchell has been paid a retainer of $6,717 (inclusive of the filing fee of $1,717.00) for legal services to be rendered. DeMarco-Mitchell does not hold or represent any material interest adverse to the Debtor or the bankruptcy estate; and is a "disinterested person"?? as that term is defined in section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Robert T. DeMarco, Esq. Michael S. Mitchell, Esq. DeMarco-Mitchell, PLLC 1255 W. 15th Street, 805 Plano, TX 75075 Tel: 972???????578???????1400 Fax: 972???????346???????6791 Email: robert@demarcomitchell.com mike@demarcomitchell.com About Oliyan Tacos, LLC Oliyan Tacos, LLC, filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code (Bankr. E.D. Tex. Case No. 20-41942) on Sep. 14, 2020. At the time of filing, the Debtor estimated $50,001 to $100,000 in assets and $500,001 to $1 million in liabilities. Robert T. DeMarco, Esq. at Demarco-Mitchell, PLLC, is the Debtor's counsel. ONPOINT OIL: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: OnPoint Oil & Gas, LLC 1620 S.W. 122nd Street, Suite 200 Oklahoma City, OK 73170 Business Description: OnPoint Oil & Gas, LLC is a privately held company in the oil and gas extraction industry. Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court Western District of Oklahoma Case No.: 20-13383 Debtor's Counsel: O. Clifton Gooding, Esq. THE GOODING LAW FIRM, P.C. 650 City Place Building 204 N. Robinson Avenue Oklahoma City, OK 73102 Tel: (405) 948-1978 Email: cgooding@goodingfirm.com Total Assets: $129,668 Total Liabilities: $2,840,455 The petition was signed by Brent Cook, owner. 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/TSMZPLA/OnPoint_Oil__Gas_LLC__okwbke-20-13383__0001.0.pdf?mcid=tGE4TAMA PARKING MANAGEMENT: To Pay At Least $1.45M to Settle JBG Smith Suit ------------------------------------------------------------------- Daniel J. Sernovitz of Washington Business Journal reports that Parking Management Inc. has agreed to pay at least $1.45 million and to take other measures to settle a lawsuit filed against it by an affiliate of JBG Smith Properties in response to the District-based parking operator's Chapter 11 bankruptcy efforts. Representatives for PMI, which is led by CEO Kingdon Gould III, filed a motion on Friday, seeking approval of the settlement agreement from the U.S. Bankruptcy Court in Greenbelt, where its Chapter 11 reorganization case, filed in May, is still pending. In addition to the $1.45 million, JBG Smith (NYSE: JBGS) will also have an unsecured claim of $800,000 in PMI's bankruptcy proceedings alongside other unsecured creditors. And PMI will take steps to modify the terms of its relationships with its landlord at JBG Smith-owned properties, including working toward terminating a management agreement between the two that dates back to 2006. Michael Lichtenstein, an attorney with Potomac-based Shulman, Rogers, Gandal, Pordy & Ecker PA, who is representing PMI in its bankruptcy case and the JBG Smith lawsuit, told the court in his settlement motion that the agreement accomplishes several goals as the parking management operator seeks a path forward from Chapter 11. Among them, it saves his client additional costs in defending itself from the lawsuit, limits the potential payout to JBG Smith in the event the latter prevailed in court and allows its employees to focus on their daily jobs rather than fielding discovery requests and attending court hearings and depositions. The resolution comes amid what PMI claims is a larger decline in profitability for the parking operation business due to the increase in ride-sharing services and other factors. The Covid-19 crisis that shuttered or significantly reduced occupancy at many office garages only accelerated that decline. PMI has moved to close underperforming locations and terminate its leases with select property owners in order to put itself on a path toward profitability. Even before the pandemic, the company posted a loss of $1.9 million in 2019, but with the closure of select locations, it projected it would have earned a profit of $700,000. About Parking Management Parking Management, Inc. -- https://www.pmi-parking.com/ -- is a parking operator in Washington, DC. It operates 88 leased or managed properties throughout the Washington, DC and Baltimore metropolitan areas, specializing in complex mixed-use properties and has experience in all levels of commercial and residential parking operations. Parking Management sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 20-15026) on May 7, 2020. At the time of the filing, the Debtor disclosed assets of between $1 million and $10 million and liabilities of the same range. Judge Thomas J. Catliota oversees the case. Shulman, Rogers, Gandal, Pordy & Ecker, PA, is the Debtor's counsel. JW Infinity Consulting, LLC, is the Debtor's financial advisor. PHILADELPHIA PERFORMING ARTS: S&P Raises Revenue Bond Rating to BB+ ------------------------------------------------------------------- S&P Global Ratings raised its rating on Philadelphia Authority for Industrial Development's series 2013 revenue bonds, issued for Philadelphia Performing Arts Charter School (PPACS) to 'BB+' from 'BB'. At the same time, S&P assigned its 'BB+' rating on the authority's series 2020 revenue bonds to be issued for PPACS. The outlook on all ratings is stable. "The higher rating reflects our view of PPACS' financial profile, which has strengthened notably in recent years, now reflecting a track record through fiscal year 2020 (unaudited) of healthy operating surpluses, sustained improvement in maximum annual debt service coverage, and growth in days' cash on hand," said S&P Global Ratings analyst Mel Brown. "The improvement in financial metrics since our last review, combined with the school's sound and large enrollment, good demand, and ability to navigate prior per-pupil funding volatility, provide cushion at the current rating to weather unexpected challenges that might arise because of the current pandemic and financial pressures that could stem from the anticipated slow and uneven economic recovery." The stable outlook reflects S&P's expectation that PPACS will sustain steady enrollment and healthy demand, while maintaining MADS coverage and liquidity consistent with the current rating level. S&P also anticipates that the school will successfully execute its charter contract as planned. PHIO PHARMACEUTICALS: Stockholders Pass All Proposals at Meeting ---------------------------------------------------------------- Pho Pharmaceuticals Corp. held its 2020 Annual Meeting of Stockholders on Oct. 8, 2020, at which the stockholders: (a) elected Robert J. Bitterman; Geert Cauwenbergh Dr. Med. Sc.; Gerrit Dispersyn Dr. Med. Sc.; H. Paul Dorman; Robert L. Ferrara; Jonathan E. Freeman, Ph.D.; and Curtis A. Lockshin, Ph.D. as directors to serve until the Company's 2021 Annual Meeting of Stockholders; (b) ratified the appointment of BDO USA, LLP as the Company's independent registered public accounting firm for the year ending Dec. 31, 2020; and (c) approved the Company's 2020 Long Term Incentive Plan. About Phio Phio Pharmaceuticals Corp. is a biotechnology company developing the next generation of immuno-oncology therapeutics based on its self-delivering RNAi therapeutic platform. The Company's efforts are focused on silencing tumor-induced suppression of the immune system through its proprietary INTASYL platform with utility in immune cells and/or the tumor micro-environment. The Company's goal is to develop powerful INTASYL therapeutic compounds that can weaponize immune effector cells to overcome tumor immune escape, thereby providing patients a powerful new treatment option that goes beyond current treatment modalities. Phio reported a net loss of $8.91 million for the year ended Dec. 31, 2019, compared to a net loss of $7.36 million for the year ended Dec. 31, 2018. As of June 30, 2020, the Company had $20.21 million in total assets, $2.48 million in total liabilities, and $17.73 million in total stockholders' equity. "If we are unable to achieve or sustain profitability or to secure additional financing, we may not be able to meet our obligations as they come due, raising substantial doubts as to our ability to continue as a going concern. Any such inability to continue as a going concern may result in our common stockholders losing their entire investment. There is no guarantee that we will become profitable or secure additional financing. Our financial statements do not include any adjustments to, or classification of, recorded asset amounts and classification of liabilities that might be necessary if we were unable to continue as a going concern. Changes in our operating plans, our existing and anticipated working capital needs, the acceleration or modification of our expansion plans, increased expenses, potential acquisitions or other events will all affect our ability to continue as a going concern," the Company stated in its 2019 Annual Report. PIVOTAL HOLDINGS: S&P Raises ICR to 'B+'; Rating Withdrawn ---------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on global provider of payment processing solutions Pivotal Holdings Corp. to 'B+' from 'B-' and subsequently withdrew this rating as the entity is no longer part of the corporate structure. At the same time, S&P assigned its 'B+' issuer credit rating to the parent company Nuvei Corp. S&P is also raising its issue-level rating on the company's first-lien debt to 'B+' from 'B-', based on a recovery rating of '3' (rounded estimate recovery of 60%). Pivotal Holdings raised about $833 million of gross proceeds from its IPO and concurrent private placement. The company used the proceeds to repay most of its debt, contributing to a material reduction in leverage. Nuvei has repaid its outstanding second-lien term loan, and S&P is subsequently withdrawing its 'CCC' issue-level rating on this debt. Nuvei used IPO proceeds to redeem debt, therefore reducing leverage substantially and improving future free cash flows. The company deployed all proceeds to repay $477 million of first-lien term loan and fully repay its second-lien term loan of $139 million and convertible debentures of $93.4 million. The transaction lowered leverage to about 1.1x from 6.9x as of June 30, 2020. Furthermore, the lower debt balance will reduce interest costs by over $60 million on annual basis and contribute to higher free cash flow generation. "Our business risk assessment on Nuvei is unchanged, reflecting our view of the company's small scale, narrow end-market focus, and e-commerce capabilities in the highly competitive and fragmented global payments industry. Offsetting these risks are strong industry fundamentals such as ongoing secular conversion to digital payments and e-commerce same-store sales growth that should continue to support revenue growth and margin expansion," S&P said. "In addition, Nuvei boasts a well-diversified global merchant base with higher exposure to the financial services, regulated gaming, and discretionary spending verticals," the rating agency said. S&P anticipates that Nuvei will continue to enhance scale, geographic footprint and expand its capabilities through acquisitions. Nuvei completed the acquisition of SafeCharge on Aug. 1, 2019. The strategic combination allowed Nuvei to migrate to the fast-expanding online channel from a more mature partnership-based model, leveraging SafeCharge's processing capabilities and risk management tools. The acquisition strengthened the company's market position and scale by expanding its global footprint into Europe, Asia, and Latin America, and diversifying its end-market exposure and customer base from predominately small to midsize businesses (SMB) to larger, more sophisticated customers. The company expects to complete the acquisition of Smart2Pay in the second half of 2020. Smart2Pay is a European-based payments technology company that serves a blue-chip customer base with a focus on digital gaming. This acquisition will further diversify Nuvei's merchant base and revenue streams, while bolstering its market share in the digital gaming vertical and online marketplaces. With a stronger balance sheet and manageable debt load, S&P expects acquisitions to be the primary uses of capital over the medium term particularly given the consolidating nature of the payment industry. Nuvei is somewhat insulated from the impact of COVID-19 due to its vertical exposure, diversity of payment types, geographic footprint, and tech-enabled integrated solutions. Although S&P expects the company's SMB-focused, card-present payment processing business to be impaired by shelter-in-place and social distancing mandates across the U.S. and Canada, the e-commerce business is positioned for significant growth. The company generated approximately 71% of its revenues through its e-commerce business, which will offset weakness in traditional merchant acquiring. In addition, it has significant exposure to a few of the better performing sectors such as regulated gaming and gambling. Highly affected discretionary spending categories such as travel and restaurants are not big contributors. Notwithstanding uncertainty around the trajectory and nature of the pandemic recovery path, S&P believes the company's performance will remain resilient throughout this downturn. Nuvei's acquisitive history and ownership structure could limit likelihood of leverage sustaining at these low level. Following the IPO, Novacap and Caisse de depot et placement du Quebec (CDPQ) account for about 60% of the company's voting shares and 46% of the total outstanding shares. Although S&P continues to view Nuvei as a financial sponsor-owned entity, it revised its financial policy assessment on Nuvei from FS-6 to FS-5 reflecting its expectation that the risk of re-leveraging the company beyond 5x is very low incorporating M&A assumptions. A more conservative financial policy assessment would require the anticipation of the sponsor's relinquishment of control over the near to medium term, and a track record of consistently operating with leverage below 4x. The stable outlook reflects S&P's expectation that despite macroeconomic weakness due to the COVID-19 pandemic, Nuvei will outperform its peers and generate revenue in the low-double-digit percentage area driven by its robust e-commerce verticals and the ongoing shift in consumer spending to digital payment channels. "We could consider raising our rating on Nuvei if it exhibits organic revenue growth above our forecast and substantially increases its scale. We would also look for current private-equity ownership to relinquish the majority control in the company," S&P said. "Although unlikely over the next year, we could lower our rating on Nuvei if its leverage approaches 5x. This could occur if the company experiences material deterioration in its revenue and profitability or completes a large debt-funded acquisition," the rating agency said. PLANTERS EXCHANGE: Seeks Approval to Hire Accountant ---------------------------------------------------- The Planters Exchange, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Florida to hire Matt Gilbert, a certified public accountant practicing in Florida. Mr. Gilbert will provide accounting services to the Debtor to assist in the prosecution of the bankruptcy petition of the Debtor. The accountant has agreed to represent the Debtor for compensation at the rate of $325 per hour, plus expenses. Mr. Gilbert neither holds nor represents any interest adverse to the Debtor or its estate. Mr. Gilbert holds office at: Matt H. Gilbert, CPA Carr, Riggs, & Ingram 2633 Centennial Boulevard, Suite 200 Tallahassee, FL 32308 Telephone: (850) 878-8777 Facsimile: (850) 878-2344 E-mail: MGilbert@cricpa.com About The Planters Exchange Inc. The Planters Exchange, Inc. is a Havana, Fla.-based company that sells used merchandise such as clothing, antiques, furniture, books and jewelry. Planters Exchange filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Fla. Case No. 20-40322) on Aug. 19, 2020. Planters Exchange President Wayne H. Gregory signed the petition. At the time of the filing, Debtor disclosed total assets of $1,074,500 and total liabilities of $405,000. Judge Karen K. Specie oversees the case. The Law Office of Allen P. Turnage serves as the Debtor's legal counsel. PRIMO FOODS: Seeks to Hire Joyce W. Lindauer as Legal Counsel ------------------------------------------------------------- Primo Foods and Beverage, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to hire Joyce W. Lindauer Attorney, PLLC as its legal counsel. The firm will assist the Debtor to effectuate a reorganization, propose a plan of reorganization and effectively move forward in its bankruptcy proceeding. The hourly billing rates of the firm's attorneys and paraprofessionals are as follows: Joyce W. Lindauer $395 Kerry S. Alleyne $250 Guy H. Holman $205 Dian Gwinnup $125 Paralegals and Legal Assistants $65 to $125 The firm has been paid a retainer of $11,717, which included the filing fee of $1,717 in connection with the bankruptcy case. Joyce W. Lindauer, the owner of the law practice Joyce W. Lindauer Attorney, PLLC, and contract attorneys, Kerry S. Alleyne and Guy H. Holman, disclosed in court filings that the firm is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Joyce W. Lindauer, Esq. Kerry S. Alleyne, Esq. Guy H. Holman, Esq. JOYCE W. LINDAUER ATTORNEY, PLLC 1412 Main Street, Suite 500 Dallas, TX 75202 Telephone: (972) 503-4033 Facsimile: (972) 503-4034 E-mail: joyce@joycelindauer.com About Primo Foods and Beverage, LLC Primo Foods and Beverage, LLC, a Fla.-based limited liability company, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No. 20-60627) on September 21, 2020. At the time of the filing, Debtor had estimated assets of between $1,000,001 and $10 million and liabilities of the same range. Joyce W. Lindauer Attorney, PLLC is Debtor's legal counsel. PROVIDENT GROUP: S&P Cuts Rating on 2015A-B Revenue Bonds to 'B' ----------------------------------------------------------------- S&P Global Ratings lowered its rating on New Jersey Economic Development Authority's series 2015A tax-exempt and series 2015B taxable student housing revenue bonds, issued for Provident Group???Rowan Properties LLC, four notches to 'B' from 'BB+' and removed the rating from CreditWatch, where S&P Global Ratings had placed it with negative implications on July 23, 2020. The outlook is negative. "The multinotch rating action reflects our view of the uncertainty and financial risk Rowan Properties faces due to significantly lower occupancy in its residence facility as a direct result of COVID-19," S&P said. Due to substantially reduced rental revenue, debt service coverage is projected to decrease below covenanted levels, projected at 0.46x debt service coverage in fiscal 2020, fiscal year-end Dec. 31. The rating action also considers S&P's view of current project reserves, which have weakened from already modest levels, limiting budgetary flexibility and elevating credit risk. While the project did not draw on the debt-service-reserve fund to meet the July 1, 2020, payment, management intends to use the debt-service-reserve fund to make its Jan. 1, 2021, payment on time and in full. The negative outlook reflects S&P's view that the project will likely generate weaker rental revenue during the outlook period, which will likely necessitate the use of the debt-service-reserve fund, coupled with continued uncertainty regarding its ability to replenish these funds. Fiscal 2019 financial statements reflect a going-concern emphasis of matter due to uncertainty from COVID-19. In S&P's opinion, financial operations are not sustainable, which will likely lead to an event of default without additional support from the university. "We could lower the rating further if coverage and payments were to experience continued pressure; if the university cannot improve occupancy to historical levels, whether due to restrictions or weakened demand; and if COVID-19-related pressure were to continue to have an effect on the trajectory of the project's finances and continue to weaken reserves," said S&P credit analyst Kevin Barry. "We could revise the outlook to stable if the housing project were to improve occupancy so that debt service coverage consistently improves and if the project were to stabilize operating performance and materially replenish available reserves." The rating action also reflects S&P's opinion of the operating pressure that faces Rowan Properties due to its view of the sudden loss of rental revenue as students vacated the residence facility following the onset of COVID-19. S&P views the risks posed by COVID-19 to public health and safety as a direct social risk under its environmental, safety, and governance factors that support the downgrade because of the pandemic's uncertain duration. Due to COVID-19, Rowan University transitioned to remote learning to protect the health and safety of students and limit community spread. Despite elevated social risk, S&P thinks the project's environmental and governance risks are in-line with its view of the sector as a whole. Total debt outstanding is roughly $124 million. Rowan Properties used series 2015A and 2015B bond proceeds to finance Holly Pointe Residence Hall, a 1,415-bed facility on the campus of Rowan University. The bonds are nonrecourse obligations of Rowan Properties, secured by net facility revenue. A leasehold mortgage and security agreement provide additional security for bondholders and supplement the student residential facility revenue pledge. The university owns the facility's land and leases it to Rowan Properties for a term extending beyond the 32-year final maturity of the series 2015 bonds. The project maintains a debt-service-reserve fund equal to maximum annual debt service. Debt service for the bonds is a fixed rate and structured on an escalating basis for the first nine years. Annual debt service coverage was about $7.1 million for fiscal 2019, the first year excluding capitalized interest. As of Sept. 30, 2020, management reports it has roughly $2.77 million in its operating and surplus reserve funds. The project also maintains $8.5 million in its debt-service-reserve fund. Project ownership will revert to Rowan University once Rowan Properties repays the bonds. REAGOR-DYKES MOTORS: Court Narrows Claims in Suit vs FirstCapital ----------------------------------------------------------------- In the case captioned REAGOR AUTO MALL, LTD., REAGOR-DYKES AMARILLO, LP, REAGOR-DYKES FLOYDADA, LP, REAGOR-DYKES IMPORTS, LP, REAGOR-DYKES PLAINVIEW, LP, REAGOR-DYKES MOTORS, LP, REAGOR-DYKES SNYDER, L.P., Plaintiffs, v. FIRSTCAPITAL BANK OF TEXAS, N.A. Defendant, Adversary No. 20-05002 (Bankr. N.D. Tex.), FirstCapital Bank of Texas, N.A. filed a motion under Bankruptcy Rule 7012(b) and Federal Rule of Civil Procedure 12(b)(6) seeking dismissal of all counts of Plaintiffs' Original Complaint. The plaintiffs filed their response opposing dismissal; in the alternative, they requested an opportunity to amend the complaint. Upon analysis, Bankruptcy Judge Robert Jones has determined that Reagor-Dykes has not sufficiently pleaded the transfer element of its preference and fraudulent transfer counts and thus, if not amended, such causes, as well as Counts Three and Five, are subject to dismissal. Judge Jones denied the motion as to Counts Four, Six, and Seven. The Debtors argued that their rogue CFO, Shane Smith, collaborated with FirstCapital to, in effect, defraud the Debtors and their creditors. This was done by the daily movement of funds among the Debtor-entities' bank accounts in amounts that far exceeded the Debtors' ability to honor. FirstCapital was in the middle of Smith's scheme by allowing the Debtors to maintain large overdrafts in the Debtors' accounts at FirstCapital and by accommodating the Debtors' "perverted" use of sight drafts to create immediate credit and several days' "float" that allowed the scheme to persist. The Debtors alleged the scheme both generally and anecdotally. Smith, "no later than February 2017, began collaborating with FirstCapital in fraudulent schemes to defraud the Debtors and their creditors." For 2017 and 2018, RAM, with monthly sales of $14.3 million, had monthly deposits and credits of over $70 million. From late 2017 through August 2018, $383 million was disbursed from a RAM account to other Reagor-Dykes accounts. In March 2017, the Amarillo account at FirstCapital was overdrawn by $611,000; in January 2018, RAM, Amarillo, and Floydada's accounts were each overdrawn by almost $1.4 million. The complaint states that RAM's and Amarillo's average daily balances for February 2018 were a negative $3.95 million and a negative $1.328 million, respectively. And they each maintained a negative average balance every month from December 2016 through February 2018. Smith and FirstCapital's representative communicated on an almost daily basis about Reagor-Dykes' abusive use of its accounts at FirstCapital. FirstCapital accommodated and took "active measures" to help Smith carry-out his "sales" and "meaningless churning of inventory between dealerships," so that Smith could obtain funds to deploy where needed at the moment. The allowed overdrawing of accounts and the float created by use of sight drafts constituted interest-bearing loans by FirstCapital to the Debtors. FirstCapital benefitted by going along with Smith's electronic kiting scheme. The Debtors' deposit accounts were highly inflated and thus, as a result, so was the bank's perceived financial position. This was all happening at a time when the bank was looking to purchase another bank. It had the effect of reducing the cash needed for the purchase and avoided a "cascade of defaults" throughout the Reagor-Dykes enterprise, including a default on FirstCapital's floorplan financing of Reagor-Dykes. By the complaint, the Debtors alleged that the bank is an insider as to the Debtors under both the Bankruptcy Code -- because Rick Dykes was one of two ultimate owners of Reagor-Dykes and a director of FirstCapital -- and common law. The Debtors also alleged that upon the August 2018 bankruptcy filings, FirstCapital agreed, upon Rick Dykes's pledge of over $7 million of additional collateral, to provide an additional $2.1 million of floorplan financing to Reagor-Dykes. FirstCapital never provided the loan. The Debtors asserted seven grounds for recovery: Count One for Preferential Transfers under section 547; Count Two for Actual Fraudulent Transfers under section 544, 548(a)(1)(A), 550, and 551; Count Three for Recovery of Avoided Transfers under ?? 550; Count Four for Equitable Subordination; Count Five for Objection to and Disallowance of Claims; Count Six for Willful Violation of the Automatic Stay; and Count Seven for Attorneys' Fees and Costs. FirstCapital said it was, at most, a mere conduit on the Debtors' movement of funds in-and-out of their accounts at FirstCapital. But to the extent the movement of funds constituted transfers to FirstCapital, the Debtors have failed to plead the transfer-based causes -- Counts One, Two, Three, and Five -- with sufficient particularity. FirstCapital said it is impossible to identify the transfers and sticking a label on a type of transfer is inadequate to provide notice. Each transfer must be identified by date, the transferor, the transferee, and amount. These counts must therefore be dismissed, FirstCapital argued. And if the underlying preference and fraudulent transfer claims are dismissed, so too must Count Three for recovery of avoided transfers and Count Five for disallowance of FirstCapital's claim (there would be no avoidable transfer to repay or offset). FirstCapital raised purely legal grounds for dismissal of the Debtors' claims of equitable subordination, for willful stay violation, and attorneys' fees. FirstCapital argued that the Debtors do not have standing to bring an equitable subordination claim; that its administrative freeze of accounts is not, as a matter of law, a stay violation; and that attorneys' fees are simply not recoverable on the Debtors' claims. Addressing the equal subordination claim, the Court denied FirstCapital's request. FirstCapital asked the Court to dismiss the Debtors' equitable subordination claim based on its in pari delicto defense. Judge Jones stated that in pari delicto is "an equitable defense that bars a plaintiff's recovery where the plaintiff itself bears responsibility for the violations he seeks to redress and preclusion of the suit would not impede public policy concerns." According to Judge Jones, bankruptcy courts disagree on whether an in pari delicto defense would even apply to an equitable subordination claim. For example, a line of cases finds it inappropriate to apply a state common law defense to a federal law cause. Other cases have looked to the language surrounding equitable subordination and have found that the unclean hands doctrine (a close relative to in pari delicto) "is not a defense to an equitable subordination claim because the claim focuses on the inequitable conduct of the creditor, not the debtor." The Court, therefore, denied FirstCapital's request to dismiss the Debtors' equitable subordination claim. After a thorough analysis of the claims, Judge Jones concluded that without curative amendments, Counts One and Two of Reagor-Dykes' complaint must be dismissed for failure to adequately plead the transfers that support both the preferential and fraudulent transfer claims under section 547 and 548, respectively. If such claims fail, so too must the causes at Count Three and Count Five. The Court denied FirstCapital's motion to dismiss Counts Four, Six, and Seven. The Court granted the Debtors fifteen days to amend the complaint. A copy of the Court's Memorandum Opinion is available at https://bit.ly/3mEsPBy from Leagle.com. About Reagor-Dykes Motors Dykes Auto Group -- https://www.reagordykesautogroup.com/ -- is a dealer of automobiles headquartered in Lubbock, Texas. The Company offers new and used vehicles, automobile parts, and other related accessories, as well as car financing, leasing, repair, and maintenance services. Some of its new vehicles include brands like Ford, Toyota, GMC, Cadillac, Chevrolet and Buick. Reagor-Dykes Motors, LP, based in Lubbock, TX, and its debtor-affiliates sought Chapter 11 protection (Bankr. N.D. Tex. Lead Case No. 18-50214) on Aug. 1, 2018. In its petition, the Debtors were estimated $10 million to $50 million in both assets and liabilities. The petition was signed by Bart Reagor, managing member of Reagor Auto Mall I, LLC, general manager and Rick Dykes, managing member of Reagor Auto Mall I, LLC, general partner. The Hon. Robert L. Jones presides over the case. David R. Langston, Esq., at Mullin Hoard & Brown, L.L.P., serves as bankruptcy counsel. BlackBriar Advisors LLC is serving as CRO for the Debtor. RGN-AUSTIN XV: Voluntary Chapter 11 Case Summary ------------------------------------------------ Debtor: RGN-Austin XV, LLC 3000 Kellway Drive Suite 140 Carrollton, TX 75006 Business Description: RGN-Austin XV, LLC is primarily engaged in renting and leasing real estate properties. Chapter 11 Petition Date: October 15, 2020 Court: United States Bankruptcy Court District of Delaware Case No.: 20-12605 Judge: Hon. Brendan Linehan Shannon Debtor's Counsel: Ian J. Bambrick, Esq. FAEGRE DRINKER BIDDLE & REATH LLP 222 Delaware Avenue, Suite 1410 Wilmington, Delaware 19801 Tel: (302) 467-4200 Email: Ian.Bambrick@faegredrinker.com Debtor's Financial Advisor: ALIXPARTNERS Debtor's Restructuring Advisor: DUFF & PHELPS, LLC Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by James S. Feltman, responsible officer. The Debtor filed an empty 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/HGWJOJI/RGN-Austin_XV_LLC__debke-20-12605__0001.0.pdf?mcid=tGE4TAMA The Debtor will move for joint administration of its case for procedural purposes only pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure under the case captioned In re RGN-Group Holdings, LLC, et al. (Bankr. D. Del. Lead Case No. 20-11961). ROBBIN'S NEST: Seeks Approval to Hire Accountant ------------------------------------------------ Robbin's Nest for Children, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire John Coggin, a certified public accountant practicing in Texas. The accountant will provide the following services: a. assist the Debtor to assimilate the data necessary to provide bookkeeping services; b. prepare bank account reconciliation, financial coding, classifying and preparation of financial statements; and c. prepare monthly operating reports or any other business services directly related to these proceedings. Mr. Coggin charges a monthly fee of $500 for the provision of the services mentioned. Mr. Coggin disclosed in court filings that he does not represent or hold any interest adverse to the Debtor or its estate. Mr. Coggin holds office at: John F. Coggins, CPA 700 Milam St., Suite 1300 Houston, TX 77002 About Robbin's Nest for Children LLC Robbin's Nest for Children LLC sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 20-33824) on July 31, 2020, listing under $1 million in both assets and liabilities. Margaret M. McClure, Esq. at the LAW OFFICE OF MARGARET M. MCCLURE represent the Debtor as counsel. ROBERT MICHELENA: Homestead Right on Property is 66.6%, Court Says ------------------------------------------------------------------ Bankruptcy Judge Eduardo V. Rodriguez sustained, in part, and overruled, in part, the objection filed by Monica Michelena, Debtor Robert Marcus Michelena's former spouse, to Robert's declaration of his Texas homestead exemption. It is commonly understood that "Texas Homesteads are favorites of the law, and are liberally construed by Texas courts." The Debtor's Texas homestead exemption pursuant to Tex. Const. art. 16 sections 50, 51; Texas Prop. Code. Sec. 41.001-.002 shall encompass only his 66.6% undivided interest in the 7.07-acre tract and his 100% interest in the 0.24-acre tract that together comprise Manlorson's Estates All of Lot 1 Block 1, 7.31AC more commonly known as 5121 W. Business Highway 83, McAllen, Texas 78501. At issue is a 7.31-acre tract known as "Manlorson's Estates All of Lot 1 Block 1 7.31AC," and known locally as 5121 W. Business Highway 83, McAllen, Texas 78501 (the "Property"). On March 4, 2019, the Debtor filed his initial petition and schedules under Chapter 11 of the Bankruptcy Code. On the Debtor's Official Form 106 A/B, ("Schedule A") the Debtor listed the Property as his homestead, valued it at $700,000, and claimed a 100% interest. On the Debtor's Official Form 106C, ("Schedule C"), the Debtor claimed he alone had a 100% interest in the Property's full value, pursuant to Tex. Const. art. 16 sections 50, 51; Texas Prop. Code. Sec. 41.001-.002. On April 4, 2019, Michelena filed an objection to the Debtor's claimed homestead exemption. Subsequently, on April 23, 2020, Ms. Michelena filed a pleading self-styled as "Monica Michelena's Amended Objection To Property Claimed As Exempt." On April 26, 2019, the Debtor filed an amended Schedule A and now lists only a 2/3 fee simple interest in the Property but increased its value to $823,061. An amended Schedule C, however, was not filed. On April 28, 2019, Debtor filed his response to Ms. Michelena's Objection. On May 13, 2019, the Debtor filed, inter alia, an amended Schedule A still claiming a 2/3 interest in the Property but decreasing its value to $820,195 and asserting that the value of his claimed 2/3 interest is $546,741.99. Curiously, the Debtor only asserted a claimed exemption in the amount of $459,303.38 on Schedule C. Nevertheless, on June 6, 2019, the Debtor once more filed, inter alia, an amended Schedule A, in which the value of the Property remained the same as the May 13, 2019 amendment; however, on amended Schedule C, the Debtor now claimed up to 100% of fair market value up to any applicable statutory limit which the Debtor asserted is $546,741.99. On August 23, 2019, the Court held an initial hearing, inter alia, on the Objection and continued the matter to Sept. 20, 2019. On Sept. 16, 2019, the Debtor filed, inter alia, an amended Schedule A still claiming a 2/3 interest in the Property but now increasing its value to $2,272,552. On amended Schedule C, the Debtor continued to assert up to 100% of fair market value up to any applicable statutory limit which the Debtor asserted is now $1,514,883.16. On Sept. 20, 2019 the Court held a further hearing, inter alia, on the Objection and continued the matter to Nov. 22, 2019. On Nov. 22, 2019, the Court held a further hearing, inter alia, on the Objection and continued the matter to Dec. 3, 2019. On Dec. 3, 2019, the Court held a further hearing, inter alia, on the Objection and continued the matter to a final hearing on Dec. 19, 2019. Lastly, on Dec. 19, 2019, the Court held a final hearing, inter alia, on the Objection. At the conclusion of the hearing, evidence was closed and the Court ordered the appointment of a chapter 11 trustee and abated all proceedings related to the Objection pending such appointment. On Dec. 23, 2019, Catherine Stone Curtis was appointed chapter 11 trustee. On Jan. 22, 2020, the Court held a status conference in which all parties requested additional time to attend a mediation in an attempt to settle the Objection. The Court granted the parties' request and continued the status conference to March 3, 2020. On March 3, 2020, the Court held its second status conference in which the parties announced that a settlement could not be reached. At the conclusion of the hearing, the Court ordered briefing on the following discrete issues: a. Whether Debtor can claim a valid Texas homestead exemption on the entirety of 7.31-acre tract known as Manlorson's Estates All of Lot 1 Block 1, 5121 W. Business Highway 83, McAllen Texas 78501; b. What impact, if any, do the following have on the Debtor's claimed homestead exemption: i. The April 30, 1992 gift deed of a 0.24-acre tract of land to the Debtor; ii. The Last Will and Testament of the Debtor's mother, Loretta Michelena; iii. The Last Will and Testament of the Debtor's father, Manuel Michelena; iv. The Debtor's claim of 100% ownership of Hidalgo County of Manlorson's Estates All of Lot 1 Block 1, 5121 W. Business Highway 83, McAllen Texas 78501; and v. 11 U.S.C. section 522(p)(1). Ms. Michelena argued that because the Debtor never lived in the Large House, he never established the 7.07-acre tract of the Property as his homestead, and thus his homestead exemption claim is limited to the 0.24-acre tract of the Property known as the Cottage. Ms. Michelena also argued that because the Debtor shares ownership of the 7.07 acres with his brothers, Ronald Michelena and Ricardo Michelena, he is not entitled to a homestead exemption for that tract. In the alternative, Ms. Michelena argued that if this Court found that the Debtor did establish the 7.07-acre tract as his homestead, he has since abandoned that homestead. In support of her contentions, Ms. Michelena testified that video and picture evidence of the Large House prove that it has not been occupied for several years because there is mildew throughout the home, and it is infested by rodents. Ms. Michelena further testified that a utility bill for the Large House reflecting a charge of about seven dollars indicates that the Large House is not being used by anyone. The Court found Ms. Michelena's arguments unremarkable. Ms. Michelena argued that the Debtor's homestead claim is limited to the 0.24-acre tract that was conveyed to him on April 30, 1992, because the Debtor resides in the Cottage built on that tract of land. Ms. Michelena maintained that the Debtor never occupied the Large House and never used the 7.07-acre tract for homestead purposes. Despite Ms. Michelena's arguments, the Debtor has cleared the short hurdle necessary to establish a homestead claim under Texas law because he owns, possesses, and uses the entire Property as his homestead. Ms. Michelena also argued that even if the Debtor has not abandoned the 7.07-acre tract, the Debtor jointly owns that tract with his two brothers, Ricardo Michelena and Ronald Michelena, as evidenced by the probated will of Debtor's father, Manuel G. Michelena,74 and thus is not entitled to a homestead exemption in the 7.07-acre tract. However, the Debtor's joint ownership of the Property with his brothers has no bearing on the validity of his homestead exemption as to Debtor's 66.6% undivided interest in the 7.07-acre tract. As a co-tenant, the Debtor is entitled to a homestead exemption coextensive with his undivided interest in the entire tract of land. According to Judge Rodriguez, to claim a jointly owned tract of land as a homestead, a claimant must have a present possessory interest in that land. The probated wills of Manuel G. Michelena and Loretta Michelena vested Debtor and his brothers with joint ownership of 7.07 acres of the Property, making the brothers tenants-in-common under Texas law. As a tenant-in-common, the Debtor has a present possessory interest in the Property and is in fact presently occupying the Property. Furthermore, each co-tenant must have "an equal right to the occupancy, use and enjoyment of the estate, and [the right to] compel a partition of same." Under Texas law, the co-tenancy relationship between Debtor and his two brothers conferred to each of them a right to possess and use the land and a right to sell or otherwise convey one's undivided interest in the 7.07 acres, without the consent of the other brothers.82 Because each of the brothers has the aforementioned rights in the 7.07 acres and Debtor has met his burden in establishing the homestead character of the Property, he is entitled to a homestead exemption in his undivided interest in the entire tract of land. While the Debtor's joint ownership of the 7.07-acre tract does not invalidate his homestead exemption claim, that claim is necessarily limited to his 66.6% undivided interest in the 7.07 acres and his fee simple interest in the 0.24 acres. A debtor's "homestead right in property can never rise any higher than the right, title, or interest that one owns in the property." Allowing the Debtor's homestead right in the tract to exceed 66.6% would prejudice the rights of his brothers because it would elevate Debtor's homestead interest above his brothers' right to partition the 7.07-acre tract. Texas law forbids such. Therefore, the Debtor's homestead interest in the 7.07-acre tract extends only to the 66.6% undivided interest he owns and his homestead exemption is coextensive therewith. The Court held the Debtor's total homestead exemption is for the 0.24-acre tract he owns in fee simple and 66.6% of the 7.07-acre tract. The bankruptcy case is in re: ROBERT MARCUS MICHELENA; dba MANLORSONS ESTATES, CHAPTER 11 Debtor(s),Case No: 19-70068 (Bankr. S.D. Tex.). A copy of the Court's Memorandum Opinion is available at https://bit.ly/2FYiOhC from Leagle.com. Robert Marcus Michelena sought Chapter 11 protection (Bankr. S.D. Tex. Case No. 19-70068) on March 4, 2019. The Debtor tapped Richard O. Habermann, Esq., as counsel. RUSSEL METALS: Moody's Rates Proposed Unsecured Notes B1 -------------------------------------------------------- Moody's Investors Service assigned a B1 rating to Russel Metals, Inc.'s proposed new senior unsecured notes. Proceeds will be used to refinance existing unsecured notes. Assignments: Issuer: Russel Metals, Inc. Senior Unsecured Regular Bond/Debenture, Assigned B1 (LGD5) RATINGS RATIONALE Russel's credit profile (Ba3 corporate family rating) benefits from its 1) solid market position in the Canadian metal service center industry and the diversity benefits of its US operations, 2) moderate leverage that is expected remain below 4x (4.2x at Q2/20), and 3) counter-cyclical working capital that enhances liquidity in down markets. It is however constrained by 1) low profit margins (2.5% operating margin LTM Q2/20), 2) inconsistent free cash flow and 3) a high dividend payout ratio. In addition, the rating incorporates Russel's material exposure to the highly cyclical oil & gas sector and to steel price volatility, both of which have caused high variability in its operating results and credit metrics. Russel announced that it will redeem CAD150 million of its senior unsecured notes due April 2022, which will reduce leverage metrics compared to second quarter 2020. Russel has produced weak operating results in 2019 and the first half of 2020, caused by a decline in carbon steel and energy tubular prices and as a result, Russel's adjusted EBITDA declined by about to CAD137 million for the twelve months ending June 2020 versus CAD336 million in 2018. Moody's expects Russel's operating results to continue to be under pressure in 2020 as continued local regulations in response to the COVID-19 pandemic has slowed construction activity, and reduced manufacturing activity, and the drop in oil prices has significantly weakened demand and lowered prices for oil country tubular goods (OCTG) and Russel's other energy focused products. Russel is exposed to carbon transition risks due to its reliance on the oil & gas sector. Efforts by many nations to mitigate the impacts of climate change through tax and regulatory policies that are intended to shift global demand towards other sources of energy or conservation are an emerging threat to oil and gas companies' profitability, cash flow and capital spending. Any reduction in capital spending by the oil & gas sector will negatively impact Russel. Russel has good liquidity over the next year (SGL-2), with about CAD330 million of available liquidity sources versus about CAD20 million of uses. Pro forma the note redemption, Russel Metals will have about CAD330 million undrawn on its revolving credit facility (matures September 2023) and Moody's expects the company to consume about CAD20 million of free cash flow over the next 12 months. The credit facility consists of CAD400 million under Tranche I to be utilized for borrowings and letters of credit and CAD50 million under Tranche II to be utilized only for letters of credit. The borrowings and letters of credit are available up to an amount equal to the sum of specified percentages of the company's eligible accounts receivable and inventories, to a maximum of CAD450 million. Russel has financial covenants associated with its credit facility, including a fixed charge coverage ratio and current ratio which the company will remain in compliance of. Russel has CAD150 million of notes that mature April, 2022 and CAD150 million of notes due in March 2026. The stable outlook reflects its expectation that Russel will maintain its leverage below 4x and will manage its inventory levels to match market conditions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING Russel's ratings could be upgraded should there be a recovery in its end markets, adjusted debt to EBITDA is sustained below 4.0x (4.2x at Q2/20), EBITA interest coverage is maintained above 3x (2.2x at Q2/20) and operating margins move back above 5% (2.5% at Q2/2020). Negative rating pressure could develop if the company's leverage ratio is expected to be maintained near 5.0x (4.2x at Q2/20), its interest coverage declines below 3.0x (2.2x at Q2/20) or operating margins remain below 3% (2.5% at Q2/2020). A weakening of the company's credit profile, or sustained negative free cash generation (especially at the expense of maintaining its dividend) could also result in a downgrade. Russel Metals, Inc. headquartered in Mississauga, Ontario, is a leading North American metal distributor. The company runs segments: (1) Metal Service Centers (~50% of revenues) (2) Energy Products (~40%), and (3) Steel Distributors (~10%). Revenues in 2019 were CAD3.7 billion. The principal methodology used in this rating was Distribution & Supply Chain Services Industry published in June 2018. SABER INTERMEDIATE: S&P Assigns 'B-' ICR; Outlook Stable -------------------------------------------------------- S&P Global Ratings assigned its 'B-' issuer credit rating to Saber Intermediate Corp. and Service Logic Acquisition Inc., the borrower of the proposed debt. Saber Intermediate Corp., the parent holding company of Service Logic Acquisition, issues the group's financial statements and guarantees its debt. At the same time, S&P is assigning its 'B' issue-level rating and '2' recovery rating to the group's proposed first-lien debt facilities. The second-lien debt is unrated. The stable outlook reflects S&P's expectation that Service Logic will continue to expand its preventative maintenance customer base, which will enable it to generate an increased level of repair work, organically expand its business, and undertake a steady cadence of acquisitions to improve its top line in 2021. Therefore, S&P expects the company's debt leverage to decline to the mid- to high-6x area in 2021, from about 7.2x estimated pro forma for the transaction at year-end 2020, while it achieves a free operating cash flow (FOCF)-to-debt ratio around the mid-4% area. The stable outlook reflects S&P's expectation that Service Logic will continue to expand its preventative maintenance customer base, which will enable it to generate an increased level of repair work, organically expand its business, and undertake a steady cadence of acquisitions to improve its top line in 2021. Therefore, S&P expects the company's debt leverage to decline to the mid- to high-6x area in 2021, from about 7.2x estimated pro forma for the transaction at year-end 2020, while it achieves a free operating cash flow (FOCF)-to-debt ratio around the mid-4% area. "Our rating on Service Logic incorporates its high starting debt leverage, aggressive acquisition strategy, and profit margins that are competitive but reflect its high labor costs and limited pricing power," S&P said. "At the same time, we view its key strengths, including its focus on largely nondiscretionary HVAC services, its good growth execution both organically and through well-integrated acquisitions, and FOCF generation of about $40 million-$45 million before semi-fixed earn-out payments, as partially offsetting these risk factors," the rating agency said. While the company's operating profitability (in the 9%-10% area) is competitive for its industry, S&P believes the company's high labor and wage rates and limited pricing power will provide it with minimal operating flexibility to offset its high starting debt leverage. The commercial HVAC servicing industry is highly fragmented as it comprises thousands of small regional contractors and mom-and-pop shops, as well as large original equipment manufacturers (OEMs) and building management companies that choose to in-source their routine maintenance work, due to the limited barriers to entry. Because of this, the level of competition is high and providers have limited pricing power given that they typically compete on the strength of their relationships in the local market and their ability to deliver high-quality work on time. As a national-scale operator with sophisticated technology, a diverse geographic footprint, and growing partner network, Service Logic can offer value to customers looking to use a single provider nationwide. Service Logic's national-scale platform is growing with a solid sales pipeline that S&P expects will support organic growth, though it remains a small portion of revenue at this time. Although only 16% of the company's revenue is contracted through maintenance agreements, which are generally 1-5 years in length, the company benefits from a high rate of re-ocurring revenue (around 90%) that provides sales visibility. Costs associated with switching providers are low. However, building operators tend to rely on technicians experienced with their building's complex equipment for any incremental ad-hoc work, including emergency repairs, break fix, and replacement/retrofitting work, which is typically completed on a 12-15 year cycle as needed. As such, the company derives nearly half of its revenue from its contracted customer base and has focused on expanding its maintenance base to win additional follow-on jobs. This has been successful as Service Logic states that it has achieved organic revenue growth of 8%-9% over the last couple of years by having its sales staff prioritize its maintenance-first and incremental work pull-through strategy. Around 40% of its other recurring sales are derived from buildings that self-perform routine maintenance work but regularly call on Service Logic for complex, non-standard services. The company generates the remaining 10% of its revenue from new and non-reoccurring customers. Given Service Logic's reliance on its existing customer relationships, maintaining high labor quality is key to sustaining its high recurring revenue. Therefore, S&P believes the company's profitability is constrained by its dependence on its technician workforce. Due to the complexity of commercial building HVAC equipment, these technicians are skilled laborers that demand high wages, thus the bulk of Service Logic's cost base is comprised of cost of sales (70%) which is largely labor, subcontractor, and union workforce costs. Accordingly, S&P believes that margin expansion opportunities are limited because these high labor expenses burden its cost structure, though the rating agency notes that these challenges are felt amongst most competitors within the HVAC and broader facilities services industry, and not unique to the company whose profit margins are, in its view, above peer-levels. Altogether, given the high debt servicing costs stemming from the contemplated transaction, Service Logic will have limited operational flexibility to withstand any unanticipated operating issues. The company's high starting leverage of more than 7x, aggressive debt-funded acquisition strategy, and financial-sponsor ownership support S&P's expectations that its leverage will remain above 6.5x over the next 12-18 months. Pro forma for the transaction, S&P forecasts that Service Logic's adjusted leverage will be high at about 7.2x on an S&P-adjusted basis as of year-end 2020. S&P expects the company's organic and acquired earnings growth to enable it to reduce its leverage to the mid-to-high-6x area by the end of 2021. Outside of its organic focus, the company's growth is predicated on continuing its acquisition strategy. The company has a history of successfully integrated acquisitions (including over 12 acquired companies during 2019 that contributed to its 42% revenue growth for the year). S&P expects the company will fund these purchases with free cash flow and debt, including borrowings from its sizeable proposed delayed-drawn term loan facilities ($150 million in proposed first-lien commitments and $50 million in second-lien delayed draw facilities), over the next 12-18 months. The company's historic acquisition multiples in the 5x-6x area will likely support leverage reduction over time. However, as Service Logic draws on its incremental facilities, this will further increase its already high interest payments. The company's minimal capital expenditure (capex) requirements and manageable annual working capital outflows support good free cash flow conversion, though S&P views it as burdened by growing acquisition earn-out payments. Service Logic's contingent performance-based earn-out considerations totaled nearly $30 million as of the most recent quarter ended June 30, 2020. With $17 million in maximum payments scheduled through 2021 (assuming it maintains its robust performance), S&P views its actual free cash flow as being around $25 million to $30 million. S&P assesses the company's leverage tolerance as aggressive due to its high starting debt leverage and financial-sponsor ownership. In S&P's view, financial sponsors have a tendency to institute aggressive financial strategies, including the use of debt to maximize shareholder returns. As such, S&P expects Service Logic's debt to EBITDA to remain above 6.5x over the rating agency's forecast period. S&P expects Service Logic will maintain its stable growth prospects despite the global recession and COVID???19 related service disruptions. Pro forma revenue missed the company's budget by about 15% in the second quarter of 2020 because of coronavirus-related shutdowns. S&P believes this decline was largely due to access issues as technicians were unable to complete routine repair work during certain facility shutdowns. In addition, there is less demand for repair work during periods of low occupancy because buildings' HVAC systems are less stressed. Coming out of the shutdown, S&P expects Service Logic's volume of emergency repair work to rebound materially, supported by its favorable geographies and low exposure to the most affected retail and hospitality end-markets. Service Logic's footprint in less dense metropolitan cities should support a slightly quicker return to work post-shutdown than cities with high public transit use; even partial building occupancy necessitates HVAC use, wear, and tear. The company's replacement and retrofitting (nearly 50% of total revenue) business will likely be the most affected by the pandemic, though S&P believes core demand will recover in 2021. S&P believes that some of these projects are vulnerable to delays as cost pressures on businesses and governments stemming from the recession weigh on the volume of discretionary work. Still, the value of Service Logic's HVAC focus supports the rationale that these projects can only be deferred to a certain degree before presenting mission-critical business risks. The importance of maintaining good air quality has been further emphasized by the health concerns surrounding the coronavirus pandemic. As such, S&P forecasts the company's organic revenue will decline by about 3% in 2020 before rebounding by nearly 10% in 2021 as the cadence of maintenance, repair, and retrofitting work normalizes over the next 12 months. The stable outlook reflects S&P's expectation that Service Logic will continue to expand its preventative maintenance customer base, which will enable it to generate an increased level of repair work, organically expand its business, and undertake a steady cadence of acquisitions to improve its top line in 2021. Therefore, S&P expects the company's debt leverage to decline to the mid- to high-6x area in 2021, from about 7.2x estimated pro forma for the transaction at year-end 2020, while it achieves a free operating cash flow (FOCF)-to-debt ratio around the mid-4% area. "We could lower our ratings on Service Logic over the next 12 months if operating performance issues related to customer losses, an inability to pass along increased costs or manage its labor pool, or poorly timed acquisitions weaken the company's liquidity. We could also lower our rating if we conclude that its debt capitalization is unsustainable and believe it depends on favorable business conditions to meet its debt servicing obligations," S&P said. "While unlikely over the next 12 months, we could raise our rating on Service Logic if it reduces and maintains leverage below 6.5x while sustaining FOCF to debt in the mid- to high-single digit percent area. A higher rating would reflect our belief that the company and its financial sponsor will refrain from undertaking aggressive, large debt-funded dividends or releveraging acquisitions," the rating agency said. SEA OAKS GOLF: Still Searching for Buyer ---------------------------------------- Pat Johnson of the Sand Paper reports that Sea Oaks Golf Resort and Country Club in Little Egg Harbor Township has not been sold, according to spokesman Jon Whelan. "Presently, all parties are waiting for the judge to approve a sale to the secured creditor and to rule on an unsecured creditor issue, which is still pending. Once those issues are addressed and the property can be sold 'free and clear,' we will reach out to the 30+ groups that have expressed interest in purchasing the property," he said in an email. In June 2020, Joseph Mezzina, owner of Sea Oaks in Little Egg Harbor Township, filed for protection from creditors in federal bankruptcy court. The golf resort includes an 18-hole premier golf course and 31-room inn. Both have been closed since the pandemic emergency started in March. Also shuttered is the Sea Oaks restaurant and banquet hall. In the Chapter 11 filing, the golf resort had liabilities of about $10.3 million, with most of that owed to Atlantic Homes Inc. of Toms River. Atlantic Homes sued Sea Oaks in state court in February. Atlantic Homes holds a 49 percent stake in Sea Oaks Golf Club, according to the filing in U.S. Bankruptcy Court, Trenton. Sea Oaks Country Club LLC also sought Chapter 11 protection with liabilities of almost $13 million. The country club leases the property from Sea Oaks Golf Club. Unsecured creditors of the country club include people who have booked the club for celebrations. Sea Oaks also has approvals to develop 29 condominiums on a former practice range. When reached on Friday, 79-year-old Joseph Mezzina said his attorney would not allow him to comment on the court proceedings. However, Mezzina said he sold his real estate agency on Radio Road in Little Egg Harbor 10 years ago and continues to operate an air quality and mold remediation business, Synatech, with his son. The Sea Oaks Homeowners Association, owners of the common property in the senior development surrounding the golf course including two pools and club for members, is a separate entity and not involved in the bankruptcy proceedings. One resident who wanted to remain anonymous said some homeowners purchased lifetime memberships in the golf club and are anxious to know if those will be honored if a new buyer is found and approved by the court. The grounds of the golf course are being maintained during the bankruptcy, said the resident. Unconfirmed rumors are swirling on who potential buyers might be, including former Eagles quarterback and ESPN commentator Ron Jaworski, who owns seven golf courses, five in New Jersey. Hotel LBI developer Christopher Vernon may also be interested. About Sea Oaks Country Club Sea Oaks Golf Club LLC is a golf resort that offers 18 hole semi-private golf course that is open to the public, Golf Shop, Restaurant & Grill Room. Sea Oaks Country Club LLC manages the golf course and leases the property from Sea Oaks Golf Club. Sea Oaks Country Club and Sea Oaks Golf Club sought Chapter 11 bankruptcy protection (Bankr. D.N.J. Lead Case No. 20-17229) on June 3, 2020. Sea Oaks Country Club disclosed $344,900 in assets and $12.92 million in liabilities. Sea Oaks Golf Club reported assets of about $5.3 million in a Chapter 11 filing. Joseph Mezzina, managing member of J & J Partnership, signed the petitions. Timothy P. Neumann of Broege Neumann Fischer & Shaver, LLC, serves as counsel to the Debtors. SHAKY TOWN: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------- Debtor: Shaky Town Express, LLC 11013 690th Ave. Emmons, MN 56029 Business Description: Shaky Town Express, LLC is a privately held company in the general freight trucking industry. Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court District of Minnesota Case No.: 20-32409 Judge: Hon. William J. Fisher Debtor's Counsel: John D. Lamey III, Esq. LAMEY LAW FIRM, P.A. 980 Inwood Ave N Oakdale, MN 55128-7094 Tel: 651-209-3550 Email: jlamey@lameylaw.com Total Assets: $937,875 Total Liabilities: $1,128,953 The petition was signed by Steve Petersen, president. A copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/YSALO7Y/SHAKY_TOWN_EXPRESS_LLC__mnbke-20-32409__0001.0.pdf?mcid=tGE4TAM SHIFT4 PAYMENTS: S&P Rates New $450MM Senior Unsecured Notes 'B' ---------------------------------------------------------------- S&P Global Ratings assigned its 'B' rating to Allentown, Pa.-based Shift4 Payments Inc.'s $450 million senior unsecured notes. The notes are being issued by subsidiary, Shift4 Payments LLC. S&P expects the independent merchant acquirer and payment solutions provider will use the net proceeds to fully repay its first-lien term loan due in 2024. The recovery rating is '4', indicating its expectation of average (30%-50%; rounded estimate: 30%) recovery of principal in the event of a payment default. S&P is also raising the rating on the $90 million revolving credit facility due in 2022 to 'BB-' from 'B', commensurate with lower secured debt in the capital structure. The recovery rating is '1', reflecting S&P's expectation of very high (rounded estimate: 95%) recovery of principal in the event of a payment default. S&P's 'B' issuer credit rating on Shift4 is unchanged. The rating reflects the company's modest scale, small market position within the highly competitive payment processing industry, and lack of geographic and product diversity. This is partially offset by increased consumer adoption of electronic payments, continued merchant conversion from gateway to end-to-end solutions and low customer concentration. S&P's rating also reflects its expectation that Shift4's performance will improve in the second half of 2020, though uncertainty from the COVID-19 pandemic remains a risk. "The stable outlook reflects our view that the company's operating performance will gradually improve as lockdowns across the nation ease in the second half of 2020, contributing to leverage sustained below 7x over the coming year," S&P said. S&P could lower the rating if weak operating performance or high merchant attrition decrease EBITDA, causing sustained leverage above 7x. It could also lower the rating if the company adopts a more aggressive financial policy such that leverage remains above 7x, or if it maintains free cash flow to debt below 3%. S&P could raise the rating over the longer term if the company achieves steady revenue growth with continued client adoption of its payments and software solutions while maintaining consistent EBITDA margins, causing leverage to remain below 5x. Issue Ratings--Recovery Analysis Key analytical factors S&P's simulated default scenario assumes a default in 2023 because of a weak economic environment, a significant decline in merchant transaction volumes, and industry disruption that leads to heightened competition or pricing pressure. The rating agency values the company on a going concern basis using a 6x multiple, in line with the multiple for peers of similar size. Simulated default assumptions -- Year of default: 2023 -- EBITDA at emergence: $41.5 million -- Implied enterprise value multiple: 6x -- Revolver 85% drawn at the time of default Simplified waterfall -- Net enterprise value (after 5% administrative costs): $236.4 million -- Valuation split (obligors/nonobligors): 100%/0% -- Collateral value available to secured creditors: $236.4 million -- Secured first-lien debt: $79.4 million -- Recovery expectations: 80%-100% (rounded estimate: 95%) -- Collateral value available to senior unsecured notes creditors: $157 million -- Senior unsecured notes debt: $460 million -- Recovery expectations: 30%-50% (rounded estimate: 30%) SIRINE LLC: Seeks to Hire Barry A. Friedman as Legal Counsel ------------------------------------------------------------ Sirine, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Alabama to hire Barry A. Friedman & Associates, PC as its legal counsel. The firm will provide the following services: 1. take appropriate action with respect to secured and priority creditors; 2. take appropriate action with respect to possible voidable preferences and transfers; 3. prepare legal papers; 4. investigate the accounts of Debtor and the financial transactions related thereto; and 5. perform all other legal services in connection with Debtor's Chapter 11 case. The firm have agreed to an hourly rate of $250 plus expenses. The firm will receive a retainer fee of $2,500. Barry A. Friedman does not represent interests adverse to Debtor, according to court filings. The firm can be reached through: Barry A. Friedman, Esq. Barry A. Friedman & Associates, PC 257 St Anthony St. Mobile, AL 36603 Telephone: (251) 439-7400 Email: bky@bafmobile.com About Sirine LLC Sirine LLC, a Mobile, Ala.-based gas station, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ala. Case No. 20-11952) on Aug. 6, 2020. At the time of the filing, Debtor had estimated assets of up to $50,000 and liabilities of between $50,001 and $100,000. Barry A Friedman & Associates, PC is Debtor's legal counsel. SMG US 2: Moody's Lowers CFR to Caa1, Outlook Negative ------------------------------------------------------ Moody's Investors Service downgraded SMG US Midco 2, Inc.'s (dba ASM Global (ASM)) ratings, including its corporate family rating (CFR) to Caa1 from B3, probability of default rating to Caa1-PD from B3-PD and first lien term loan rating to Caa1 from B3. Concurrently, Moody's downgraded the instrument ratings on SMG Holdings, LLC's revolver to Caa1 from B3. The ratings outlook remains negative. The downgrade of the CFR reflects expectations that the coronavirus pandemic will drive continued deterioration in the company's financial results and credit metrics due to suspension of events at least through the first half of 2021. The effects of the coronavirus pandemic have continued to last longer than was anticipated in March of this year and as a result deterioration in the financial condition of the company has continued. While ASM benefits from the fixed income component associated with its management accounts, a large portion of its profitability is tied to venue performance driven by events, attendance and ancillary income from the sale of food & beverage. Moody's acknowledges the company's liquidity position of $289 million as of June 30, 2020, which is adequate through the current disruptive period. The negative outlook reflects further downside risk to the current earnings and cash flow forecast if the disruptive period extends beyond the first half of 2021 and events are not held at all or if only a limited number of events are held with restricted attendance. The entertainment and leisure sector is subject to heightened uncertainty, even with the potential for recovery prospects in second half of 2021. Downgrades: Issuer: SMG Holdings, LLC Senior Secured Bank Credit Facility, Downgraded to Caa1 (LGD3) from B3 (LGD3) Issuer: SMG US Midco 2, Inc. Corporate Family Rating, Downgraded to Caa1 from B3 Probability of Default Rating, Downgraded to Caa1-PD from B3-PD Senior Secured Bank Credit Facility, Downgraded to Caa1 (LGD3) from B3 (LGD3) Outlook Actions: Issuer: SMG Holdings, LLC Outlook, Remains Negative Issuer: SMG US Midco 2, Inc. Outlook, Remains Negative RATINGS RATIONALE ASM Global's Caa1 CFR is constrained by: (1) the continued significant negative impact of the coronavirus pandemic on its revenue and profitability; (2) elevated leverage (MCO adjusted Debt/EBITDA), limited ability to generate cash and expectations that leverage will be sustained above 9x through the next 12 to 18 months (leverage was 9.1x for the FYE December 31, 2019 period); and (3) high level of customer concentration. The company's rating benefits from: (1) leading position with over 322 properties in 21 countries and improved diversity across geographies, venues and contract types; (2) long-term contracts with retention rate of above 90% and increasing trends of outsourcing of facilities by municipalities; and (3) good growth prospects post-pandemic from pent up demand and ability to quickly ramp up with good vendor relationships. 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. Its analysis has considered the effect on the performance of corporate assets from the current weak 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. The events management industry has been one of the sectors most significantly affected by the pandemic since concerts, sporting events, conventions and theaters are inherently dependent on people being able to gather in a common space and that is impossible in the current condition on a global basis. As a result of the spread of the virus, live events have been postponed or canceled. While ASM Global has gone through cyclical downturns over time, the impact of the pandemic on its profitability and cash flow is far worse than observed in previous cycles. The rating action reflects the impact on ASM Global of the breadth and severity of the shock, and the broad deterioration in credit quality it has triggered. ASM Global's social risk is elevated. The coronavirus pandemic is expected to continue to impact operations in the event management sector and in turn the company's earnings and cash flow until a vaccine becomes available. Even when a vaccine is available, social risk may be elevated since there may be people who will voluntarily not take the vaccine and thus expose themselves and others to the infection. ASM Global's governance risk is elevated given its private equity ownership, which could lead to aggressive financial policies in the future. ASM's liquidity is adequate and consists of its unrestricted cash position of $289 million as of June 30, 2020. Cash flows are expected to remain negative over the next 12 months which will reduce liquidity. In addition, the company's $96 million revolver is almost fully drawn. The revolver matures in 2024. There are no significant debt maturities until 2025 and the credit facilities only require a 1% annual amortization on the first lien term loan. Moody's expects adequate coverage of the required term loan amortization. The revolver is subject to one financial maintenance covenant that is a minimum liquidity covenant of $20 million, tested monthly. Moody's expects the company to be able to comply with this covenant over the next 12-18 months. The company recently amended its financial covenants to suspend the springing first lien net leverage covenant through 4Q2021. There are no term loan financial maintenance covenants. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings will be downgraded if the company's revenue growth or EBITDA margin decline further if suspension of live events continues in mid-2021, resulting in worse than expected free cash flow and if liquidity becomes weaker. Conversely, for an upgrade to be considered, the company must demonstrate stable operating performance, eliminate its cash burn through free cash flow generation while sustaining Debt/EBITDA below 8.5x. ASM Global is a leading venue management company including arenas, convention centers, stadiums and theaters. The company typically assumes full managerial responsibility for all aspects of facility operations, including event booking and event management, and may also provide certain ancillary services such as food and beverage service. Pro forma for the acquisition of AEG Facilities, ASM Global generated $363 million in revenue for the LTM period ended June 30, 2020 and $518 million for FY2019. ASM is co-owned by funds affiliated with Onex Partners and AEG Venue Management Holdings, LLC. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. SOVOS BRANDS: S&P Upgrades ICR to 'B'; Outlook Stable ----------------------------------------------------- S&P Global Ratings raised the issuer credit rating on branded food company Sovos Brands Intermediate Inc. to 'B' from 'B-'. S&P also raised its issue-level rating on Sovos' senior secured credit facilities to 'B' from 'B-' with a '3' recovery rating (50%-70%; rounded estimate: 55%). S&P is assigning its 'B' issue-level and '3' recovery ratings to the proposed senior secured credit facilities. We will withdraw the issue-level ratings on the existing $280 million first-lien term loan when this transaction closes. All ratings are based on preliminary terms and are subject to review of final documentation. All ratings are based on preliminary terms and are subject to review of final documentation. "The stable outlook reflects our expectation that the company's will continue to benefit from an elevated level of at-home consumption and improved cash flow generation while maintaining debt to EBITDA in the low- to mid-5x area," S&P said. The higher rating reflects Sovos' reduced leverage resulting from strong organic EBITDA growth, which S&P believes it will sustain, driven by an increased level of at-home consumption due to the coronavirus pandemic. The company's organic revenue rose by 56% in the second quarter ended June 27, 2020, due to strong demand across its portfolio, including its Rao's and Michael Angelo's products. The increase in Sovos' EBITDA led to significant deleveraging as its debt to EBITDA improved to 4.5x for the 12 months ended June 30, 2020. Although the Birch Benders acquisition will modestly increase its pro forma debt to EBITDA to just above 5.0x, S&P expects continued mid-single digit percent sales and EBITDA growth will enable the company to quickly reduce leverage below the 5x area by next year. Although S&P expects the level of at-home food consumption to moderate over the coming quarters, the rating agency forecasts that the demand for Sovos' products will remain strong as consumers continue to eat more meals at home. While governments have eased their COVID-19 related stay-at-home orders over the past couple of months, there are still restrictions on in-restaurant dining in most regions and S&P believes many consumers remain hesitant to dine at restaurants because of fears around contracting the virus. Notwithstanding these tailwinds, S&P expects the company's revenue growth to moderate in 2021, relative to 2020, because it is unlikely there will be a round of lockdowns in 2021 like those imposed during the spring of 2020 given that most states continue to ease COVID-19 restrictions. Nevertheless, S&P believes Sovos' 2021 revenue will remain higher than 2019 and steadily expand because its portfolio of clean-label, "better-for-you" products is well positioned to increase its market share. As the company expands its portfolio, S&P forecasts EBITDA margins to stabilize in the mid???teen percent area, which will enable it to generate consistent FOCF. Although raw material cost inflation has negatively affected the profitability of Sovos' noosa segment in the past, the market share gains for its Rao's products along with the addition of Birch Benders will improve its profit stability. Specifically, S&P forecasts the company will likely sustain EBITDA margins in the 14%-16% range. Its most volatile commodity input, milk, now accounts for less than 10% of its sales. Moreover, Sovos has been able to partially offset the inflation in its milk costs with cost savings in its noosa business, including reducing administrative expenses and rationalizing and consolidating its cold storage. Rao's, the company's largest brand (over 50% of pro forma 2020 sales), is a co-manufactured product under a fixed-price contract, which reduces the risk of large swings in its input costs and requires fairly modest capital expenditure (capex). S&P forecasts Sovos to maintain margins in the 14%-15% range as it realizes better economies of scale from the Birch Benders acquisition and increases its channel distribution and household penetration." This expected margin stability, coupled with its modest annual maintenance capex requirements of $5 million-$7 million, will enable the company to consistently generate annual FOCF of more than $30 million. The acquisition of Birch Benders will add another fast-growing, clean-label brand to its portfolio. Birch Benders is a producer of better-for-you pancake and waffle mixes, toaster waffles, and pancake and baking cups. The acquisition will expand Sovos Brands' presence in the pancake mix category (a $560 million category), which is experiencing strong tailwinds from the increased level of at-home consumption related to COVID-19, with growth of over 26% in the last year (versus more than 7% a year ago). S&P expects the acquisition to bolster the company's product diversity in a new category by providing it with a premium product offering that will account for about 10% of its pro forma 2020 sales. Still, Birch Benders is a very small player in a highly competitive segment that is dominated by much larger and more-established brands such as Aunt Jemima (Quaker Oats Co.) and Bisquick (General Mills). S&P expects further product diversification into new breakfast products and packaging sizes, as well as greater distribution with new retail customers, to lead to increased household penetration, additional market share gains, and continued sales growth. "The stable outlook reflects our expectation for continued good organic operating performance by Sovos' underlying businesses, FOCF of over $20 million in fiscal year 2021, debt to EBITDA of less than 6x, fewer one-time charges, and a full year of contributions from Birch Benders and the recent innovations in its Rao's and noosa segments," S&P said. "We could lower our ratings on Sovos if we believe its leverage will weaken and remain above 6.5x while its FOCF declines significantly below our expectations. This could occur if the company experiences a significant increase in its commodity costs or a material supply chain disruption," S&P said. Although unlikely over the next year, S&P could raise its ratings on Sovos if: -- The company increases its scale and brand diversity or geographic reach and S&P favorably reassesses its business risk, which could occur if it believes it will maintain healthy organic growth rates and solid profitability; and -- The company and its financial sponsor owner commit to manage leverage below 5x. This could occur if discretionary cash flow is used for debt repayment and not the pursuit of additional debt-financed acquisitions. SSA RETAIL: Seeks Approval to Hire MD Universal as Accountant ------------------------------------------------------------- SSA Retail Management LLC and affiliates seek approval from the U.S. Bankruptcy Court for the Northern District of Texas to hire MD Universal Services, Inc. as their accountant. The firm will provide the following services to the Debtors: -- provide monthly bookkeeping services, preparation of monthly operating reports for bankruptcy proceedings, as well as financial statements utilized to prepare tax returns; -- assist in processes of gathering and assembling information to assist in determining creditor claims against the client; -- prepare federal and state tax returns for reporting periods to be identified; -- assist the Debtors if the client's tax return is selected for examination or audit; and -- perform additional services not contemplated by this communication but deemed necessary. The firm's compensation will be paid out of property of the estate from time to time and shall be computed based upon an hourly rate of $150 per hour. The firm is a "disinterested person" within the meaning of Sections 327 and 101(14) of the Bankruptcy Code, according to a court filing. The firm can be reached through: Kumod Rimal, CPA MD Universal Services, Inc. 300 Republic Lane Euless, TX 76040 About SSA Retail Management SSA Retail Management LLC, conducts business under the name Ale Taco, filed a Chapter 11 bankruptcy petition (Bankr. N.D. Tex. Case No. 20-32025) on July 29, 2020, disclosing under $1 million in both assets and liabilities. The Debtor is represented by Hayward & Associates PLLC. STEIN MART: Committee Seeks to Hire Frost Brown as Legal Counsel ---------------------------------------------------------------- The official committee of unsecured creditors of Stein Mart, Inc. and its affiliates seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Frost Brown Todd LLC as its legal counsel. The firm will render the following services to the committee: a. provide legal advice with respect to the committee's rights, powers and duties in the Chapter 11 cases; b. prepare legal papers; c. represent the committee in any and all matters involving contests with the Debtors, alleged secured creditors and other third parties; d. analyze a potential sale or liquidation of substantially all of the Debtors' assets and the interests of unsecured creditors with respect to such a sale; e. review pre-petition transactions and relationships; f. negotiate plans of reorganization or liquidation; g. assist the committee in analyzing the claims of the Debtors' creditors and the Debtors' capital structure; h. assist the committee's investigation of the assets, liabilities and financial condition of the Debtors; i. advise the committee as to its communications to the general creditor body; j. review and analyze all applications, orders, statements of operations and schedules filed with the court; k. perform all other legal services for the committee. The firm 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: Ronald E. Gold, Esq. Douglas L. Lutz, Esq. A.J. Webb, Esq. Erin P. Severini, Esq. Frost Brown Todd LLC 3300 Great American Tower 301 East Fourth Street Cincinnati, OH 45202 Telephone: (513) 651-6800 Facsimile: (513) 651-6981 Email: rgold@fbtlaw.com dlutz@fbtlaw.com awebb@fbtlaw.com eseverini@fbtlaw.com About Stein Mart Stein Mart, Inc. (NASDAQ: SMRT) -- http://www.SteinMart.com/-- is a national specialty omni off-price retailer offering designer and name-brand fashion apparel, home decor, accessories and shoes at everyday discount prices. Stein Mart provides real value that customers love every day. The company operates 281 stores across 30 states. Stein Mart Inc. and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case Nos. 20-02387 to 20-02389) on Aug. 12, 2020. As of May 2, 2020, the Debtors had total assets of $757.6 million and total liabilities of $791.2 million. Judge Jerry A. Funk oversees the cases. The Debtors tapped Foley & Lardner LLP as their legal counsel, Clear Thinking Group LLC as financial advisor, and Stretto as claims and noticing agent. On August 18, 2020, the Office of the United States Trustee appointed the official committee of unsecured creditors. The committee selected Frost Brown Todd LLC as its legal counsel and Steven J. Solomon and Gray Robinson, P.A. as its local counsel. STEIN MART: Committee Taps FTI Consulting as Financial Advisor -------------------------------------------------------------- The official committee of unsecured creditors of Stein Mart, Inc. and its affiliates seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire FTI Consulting, Inc. as its financial advisor. The firm will provide the following financial advisory services: -- assist in the review of financial related disclosures required by the court; -- assist in the preparation of analyses required to assess any proposed Debtor-In-Possession financing; -- assist with the assessment and monitoring of the Debtors' short term cash flow, liquidity, and operating results; -- assist in the review and monitoring of the asset sale process; -- assist with review of any tax issues; -- assist in the review of the claims reconciliation and estimation process; -- assist in the review of other financial information prepared by the Debtors; -- attend meetings and assist in discussions with the Debtors, potential investors, and other secured lenders; -- assist in the review and/or preparation of information and analysis necessary for the confirmation of a plan; -- assist in the evaluation and analysis of avoidance actions; -- assist in the prosecution of committee responses/objections to the Debtors' motions; and -- perform other general business consulting or such other assistance as the committee or its counsel may deem necessary. The customary hourly rates charged by FTI professionals anticipated to be assigned to the case are as follows: Senior Managing Directors $920 - $1,295 Directors/Senior Directors/Managing Directors $690 - $905 Consultants/Senior Consultants $370 - $660 Administrative/Paraprofessionals $150 - $280 Cliff A. Zucker, senior managing director at the firm, disclosed in court filings that the firm does not hold or represent any interest adverse to the Debtors or their estates. FTI can be reached through: Cliff A. Zucker FTI Consulting, Inc. Three Times Square, 9th Floor New York, NY, 10036 Telephone: (212) 841-9355 Facsimile: (212) 841-9350 E-mail: cliff.zucker@fticonsulting.com About Stein Mart Stein Mart, Inc. (NASDAQ: SMRT) -- http://www.SteinMart.com/-- is a national specialty omni off-price retailer offering designer and name-brand fashion apparel, home decor, accessories and shoes at everyday discount prices. Stein Mart provides real value that customers love every day. The company operates 281 stores across 30 states. Stein Mart Inc. and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case Nos. 20-02387 to 20-02389) on Aug. 12, 2020. As of May 2, 2020, the Debtors had total assets of $757.6 million and total liabilities of $791.2 million. Judge Jerry A. Funk oversees the cases. The Debtors tapped Foley & Lardner LLP as their legal counsel, Clear Thinking Group LLC as financial advisor, and Stretto as claims and noticing agent. On August 18, 2020, the Office of the United States Trustee appointed the official committee of unsecured creditors. The committee selected Frost Brown Todd LLC as its legal counsel and Steven J. Solomon and Gray Robinson, P.A. as its local counsel. STEIN MART: Committee Taps Gray Robinson as Local Counsel --------------------------------------------------------- The official committee of unsecured creditors of Stein Mart, Inc. and its affiliates seeks approval from the U.S. Bankruptcy Court for the Middle District of Florida to hire Gray Robinson, P.A. as its local counsel. The firm will render the following services to the committee: a. provide legal advice with respect to the committee's rights, powers and duties in the Chapter 11 cases; b. prepare legal papers; c. represent the committee in any and all matters involving contests with the Debtors, alleged secured creditors and other third parties; d. analyze a potential sale or liquidation of substantially all of the Debtors' assets and the interests of unsecured creditors with respect to such a sale; e. review pre-petition transactions and relationships; f. negotiate plans of reorganization or liquidation; g. assist the committee in analyzing the claims of the Debtors' creditors and the Debtors' capital structure; h. assist the committee's investigation of the assets, liabilities and financial condition of the Debtors; i. advise the committee as to its communications to the general creditor body; j. review and analyze all applications, orders, statements of operations and schedules filed with the court; k. perform all other legal services for the committee. The firm 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: Steven J. Solomon, Esq. Gray Robinson PA 333 S.E. 2nd Avenue, Suite 3200 Miami, FL 33131 Telephone: (305) 416-6880 Facsimile: (305) 416-6887 Email: steven.solomon@gray-robinson.com About Stein Mart Stein Mart, Inc. (NASDAQ: SMRT) -- http://www.SteinMart.com/-- is a national specialty omni off-price retailer offering designer and name-brand fashion apparel, home decor, accessories and shoes at everyday discount prices. Stein Mart provides real value that customers love every day. The company operates 281 stores across 30 states. Stein Mart Inc. and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case Nos. 20-02387 to 20-02389) on Aug. 12, 2020. As of May 2, 2020, the Debtors had total assets of $757.6 million and total liabilities of $791.2 million. Judge Jerry A. Funk oversees the cases. The Debtors tapped Foley & Lardner LLP as their legal counsel, Clear Thinking Group LLC as financial advisor, and Stretto as claims and noticing agent. On August 18, 2020, the Office of the United States Trustee appointed the official committee of unsecured creditors. The committee selected Frost Brown Todd LLC as its legal counsel and Steven J. Solomon and Gray Robinson, P.A. as its local counsel. STEM HOLDINGS: Inks Definitive Agreement to Acquire Driven ---------------------------------------------------------- Stem Holdings, Inc., Driven Deliveries, Inc. ("DRVD"), and Stem Driven Acquisition, Inc. ("SDA") entered into an Agreement and Plan of Merger wherein DRVD would merge with and into SDA, with DRVD being the surviving entity and, following closing of the merger transaction, DRVD would become a wholly-owned subsidiary of STEM. Pursuant to the Merger Agreement, STEM will exchange one newly-issued share of STEM common stock for each issued and outstanding share of DRVD. Immediately prior to the closing of the Merger, STEM will issue to each holder of warrants, options or convertible debentures to purchase DRVD shares, warrants, options and convertible debentures that are equal in value and on the same terms as the respective holder's DRVD warrants, options and debentures. Additionally, certain outstanding DRVD of the Company will be converted into shares of the Company's common stock in accordance with the terms of the Merger Agreement. Management believes that the merger transaction will close prior to the end of calendar year 2020, subject to satisfaction of all terms and conditions of the Merger Agreement and completion of due diligence by all entities. DRVD is an e-commerce and DaaS (delivery-as-a-service) provider with proprietary logistics and omnichannel UX/CX technology. At the closing, STEM would be re-named Driven by Stem and would maintain its corporate headquarters in Boca Raton, Florida. Management of both DRVD and STEM believe that following completion of the merger transaction, Driven by Stem will be the first vertically-integrated cannabis company with a DaaS platform, which will meet the needs of all cannabis consumers in markets served. Presently, STEM is traded on the OTCQX market and Canadian Stock Exchange under the symbols STMH and STEM, respectively. DRVD is presently traded on the OTCQB market. At the effective date of the closing of the merger transaction, all shares of DRVD will be converted into the right to receive shares of STEM Common Stock. The Merger Agreement includes interim covenant provisions applicable prior to the earlier of the (i) closing of the Merger or (ii) termination of the Merger Agreement that, among other things, restrict the Company's ability to take certain actions with respect to the Company's organizational documents. Under the terms of the Merger Agreement, DRVD shareholders will receive (based on closing share prices as of Oct. 8, 2020) an aggregate purchase price of approximately US$27.5M. Based on the Oct. 8, 2020 closing prices of both DRVD and STEM, Driven by Stem would have a combined market capitalization of approximately US$54 million, based on to closing market price of the Stem Shares and Driven Shares on the OTCQX and the OTCQB, respectively, on Oct. 8, 2020 and 65M Stem Shares and 75M Driven Shares being outstanding on October 8, 2020. The Board of Directors of each of Stem and Driven Deliveries have unanimously approved the Acquisition and it is expected to close in late 2020, subject to regulatory and stockholder approvals, completion of final due diligence and other customary closing conditions. Driven by Stem, the combined entity after giving effect to the Acquisition, will maintain its headquarters at Stem's current location in Boca Raton, FL. Following the completion of the merger transaction, management believes that the combined companies will achieve synergies in sales and operations and reduced sales, general and administrative expense as a percentage of sales. Management also believes that the merger transaction will lead to further organic growth and margin expansion. The merger transaction is an arm's length transaction. Following the effective date of the merger transaction, the shares of common stock of the combined companies are expected to continue to trade under STEM's current symbols (OTCQX: STMH CSE: STEM). Driven by Stem will integrate DRVD's delivery capability and its robust technology in every state in which STEM currently operates and add STEM's iconic cannabis brands to DRVD's platform of over 400 cannabis products. Stem's brand offerings cover multiple cannabis product categories, particularly flower, extracts, edibles and topicals with award-winning brands including TJ's Gardens and Yerba Buena; Cannavore an edible brand; and Doseology, a CBD mass market brand launching in 2021. As a cannabis technology company, DRVD's Budee and Ganjarunner e-commerce platforms will also partner with leading cannabis companies in new geographies to meet demand for quick and accurate product deliveries. Initial operations will span nine states. Management and Corporate Governance Upon the closing of the merger transaction, the members of senior management of Driven by Stem expected to be: * Adam Berk, chief executive officer and chairman: Adam Berk is the current CEO of STEM and a member of DRVD's Board of Directors. Mr. Berk is the former CEO of Osmio (currently GrubHub), which was the first patented web-online food ordering system. * Steve Hubbard, chief financial officer: Steve Hubbard is the current CFO of STEM. * Ellen Deutsch, EVP/chief operating officer: Ellen Deutsch is the current executive vice president and COO of STEM. Ms. Deutsch was an executive of Hain Celestial for over 20 years prior to joining STEM. * Salvador Villanueva III, president: Salvador Villanueva III is the current president of DRVD. * Brian Hayek, chief compliance officer & special projects: Brian Hayek is a co-founder and current chief financial officer of DRVD. Synergies Management of both companies believe that the merger transaction will be accretive to EPS of the combined companies in calendar year 2021. Other expected benefits are: (1) increased scale to drive sales growth, (2) leveraging DRVD's proprietary technology in new markets to drive market share; (3) cost savings estimated at $1.5M in the first year of combined operations through productivity initiatives, vertical supply chain efficiencies, and reduction and consolidation of overhead and administrative costs. Both STEM and DRVD have taken steps to commence equity raises of up to $20M on a combined basis. The merger transaction is not expected to increase debt levels. The completion of the merger transaction is subject to satisfaction or waiver of various closing conditions, including (i) the receipt of all required approvals of the stockholders of all merger participants and any required third-party consents and regulatory clearances, (ii) the absence of any governmental order or law that makes consummation of the merger transaction illegal or otherwise prohibited, (iii) the effectiveness of a Registration Statement on Form S-4 to be filed by STEM pursuant to which the shares of Common Stock to be issued in connection with the merger transaction are registered with the SEC, (iv) the completion of equity financings by STEM and DRVD and (v). The completion of due diligence by all parties and the absence of any material adverse change prior to the effective date of the merger transaction. The obligation of each party to consummate the merger transaction is also conditioned upon the other party's representations and warranties being true and correct (subject to certain materiality exceptions) and the other party having performed in all material respects its obligations under the Merger Agreement. If either party fails to meet its obligations under its equity financing closing conditions, either party may elect to terminate the Merger Agreement or proceed to close the merger transaction. Further, either party to the merger transaction could elect to waive certain conditions to the closing of the Merger in order to effect the transaction and, as a result, there can be no assurance that the combined organization will have the benefit of the conditions to closing described above or otherwise set forth in the Merger Agreement. Either Parent may terminate the Merger Agreement if the Merger has not been consummated by Dec. 31, 2020. About Stem Holdings Headquartered in Boca Raton, Florida, Stem Holdings, Inc. -- http://www.stemholdings.com/-- is a multi-state, vertically integrated, cannabis company that purchases, improves, leases, operates and invests in properties for use in the production, distribution and sales of cannabis and cannabis-infused products licensed under the laws of the states of Oregon, Nevada, California, and Oklahoma. Stem Holdings reported a net loss of $28.98 million for the year ended Sept. 30, 2019, compared to a net loss of $8.70 million for the year ended Sept. 30, 2018. As of June 30, 2020, the Company had $46.39 million in total assets, $17.72 million in total liabilities, and $28.67 million in total shareholders' equity. LJ Soldinger Associates, LLC, in Deer Park, IL, the Company's auditor since 2017, issued a "going concern" qualification in its report dated March 1, 2020, citing that the Company and its affiliates reported net losses of $28.985 million and $8.698 million, negative working capital of $2.635 million and $2.273 million and accumulated deficits of $37.082 million and $11.533 million as of and for the year ended Sept. 30, 2019 and 2018, respectively. In addition, the Company has commenced operations in the production and sale of cannabis and related products, an activity that is illegal under United States Federal law for any purpose, by way of Title II of the Comprehensive Drug Abuse Prevention and Control Act of 1970, otherwise known as the Controlled Substances Act of 1970. These factors raise substantial doubt as to the Company's ability to continue as a going concern. STONEWOOD HOMES: Case Summary & 6 Unsecured Creditors ----------------------------------------------------- Debtor: Stonewood Homes LLC 22 Larchwood Irvine, CA 92602 Business Description: Stonewood Homes LLC provides residential building construction services. Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court Central District of California Case No.: 20-12881 Judge: Hon. Theodor Albert Debtor's Counsel: William J. King, Esq. THE WJK LAW FIRM, PC 5151 California Ave., Ste 100 Irvine, CA 92617 Tel: 844-487-8784 Email: wking@wjklawfirm.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Jodi Di Tolla, managing member. A copy of the petition containing, among other items, a list of the Debtor's six unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/SUEH5DI/Stonewood_Homes_LLC__cacbke-20-12881__0001.0.pdf?mcid=tGE4TAMA TAILORED BRANDS: Porter, Gibson Update List of Term Lenders ----------------------------------------------------------- Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure, the law firms of Gibson, Dunn & Crutcher LLP and Porter Hedges LLP submitted a second amended verified statement to disclose an updated list of Ad Hoc Group of Term Loan Lenders that they are representing in the Chapter 11 cases of Tailored Brands, Inc., et al. In April 2020, certain members of the Ad Hoc Group of Term Loan Lenders retained Gibson, Dunn & Crutcher LLP to represent them as counsel in connection with a potential restructuring of the outstanding debt obligations of the above-captioned debtors and certain of their subsidiaries and affiliates. Subsequently, on or about July 31, 2020, Gibson Dunn contacted Porter Hedges LLP to serve as Texas co-counsel to the Ad Hoc Group of Term Loan Lenders. As of the date of this Second Amended Verified Statement, Gibson Dunn and Porter Hedges represent the members of the Ad Hoc Group of Term Loan Lenders in their capacities as lenders under that certain Term Credit Agreement, dated as of June 18, 2020, by and among the Men's Wearhouse, Inc., as borrower, Tailored Brands, Inc., as holdings, certain of the other Debtors, as guarantors, Wilmington Savings Fund Society, FSB, as successor administrative agent and collateral agent, and the several lenders from time to time parties thereto. Gibson Dunn and Porter Hedges do not represent or purport to represent any other entities in connection with the Debtors' chapter 11 cases. Gibson Dunn and Porter Hedges do not represent the Ad Hoc Group of Term Loan Lenders as a "committee" and do not undertake to represent the interests of, and are not fiduciaries for, any creditor, party in interest, or other entity that has not signed a retention agreement with Gibson Dunn or Porter Hedges. In addition, the Ad Hoc Group of Term Loan Lenders does not represent or purport to represent any other entities in connection with the Debtors' chapter 11 cases. Each member of the Ad Hoc Group of Term Loan Lenders does not represent the interests of, nor act as a fiduciary for, any person or entity other than itself in connection with the Debtors' chapter 11 cases. Upon information and belief formed after due inquiry, Gibson Dunn and Porter Hedges do not hold any disclosable economic interests in relation to the Debtors. As of Oct. 7, 2020, members of the Ad Hoc Group of Term Lenders and their disclosable economic interests are: CIFC Asset Management, LLC 875 3rd Ave New York NY 10022 * Term Loan Indebtness: $11,222,842.79 CIFC VS Management LLC 875 3rd Ave New York NY 10022 * Term Loan Indebtness: $8,938,786.47 CIFC CLO Management LLC 875 3rd Ave New York NY 10022 * Term Loan Indebtness: $35,373,902.36 CVC Credit Partners, LLC 5th Ave, 42nd Floor New York, NY 10019 * Term Loan Indebtness: $43,710,761.73 Intermediate Capital Group 600 Lexington Ave. New York, NY 10022 * Term Loan Indebtness: $51,698,844.68 * Unsecured Notes Indebtness: $898,000.00 PGIM, Inc. 655 Broad Street, 7th Floor Newark, NJ 07012 * Term Loan Indebtness: $65,098,735.70 Silver Point Capital, LP c/o Silver Point Capital Credit Admin Two Greenwich Plaza, First Floor Greenwich, CT 06830 * Term Loan Indebtness: $162,871,909.00 Voya Investment Management Co. LLC 7337 E. Doubletree Ranch Road Scottsdale, AZ 85258 * Term Loan Indebtness: $15,953,232.81 Voya Alternative Asset Management LLC 7337 E. Doubletree Ranch Road Scottsdale, AZ 85258 * Term Loan Indebtness: $33,914,616.10 Voya Investment Trust Co. 7337 E. Doubletree Ranch Road Scottsdale, AZ 85258 * Term Loan Indebtness: $9,940,578.09 Aegon USA Investment Management, LLC 27 West Monroe Street, Suite 6000 Chicago, IL 60606 * Term Loan Indebtness: $17,557,367 ALCOF II NUBT, L.P. c/o Arbour Lane Fund II GP, LLC 700 Canal Street, 4th Floor Stamford CT, 06902 * Term Loan Indebtness: $52,772,192.25 Canaras Capital Management, LLC 130 West 42nd Street, Suite 1500 New York, NY 10036 * Term Loan Indebtness: $8,064,939.78 Carlson Capital, L.P. 2100 McKinney Ave, Suite 1800 Dallas, TX 75201 * Term Loan Indebtness: $20,037,478.44 First Eagle Alternative Credit, LLC 227 W. Monroe, Suite 3200 Chicago, IL, 60606 * Term Loan Indebtness: $26,176,461.29 The Guardian Life Insurance Company of America 10 Hudson Yards, 20th Floor New York, NY 10001 * Term Loan Indebtness: $24,651,642 H.I.G. Capital 200 Crescent Court, Suite 1414 Dallas, TX 75201 * Term Loan Indebtness: $5,878,646.58 Bowery Funding ULC c/o The Bank of Nova Scotia 40 King Street West 68th Floor Scotia Plaza Toronto, ON Canada M5H 1H1 * Term Loan Indebtness: $989,843.48 Marathon Asset Management One Bryant Park, 38th Floor New York, New York 10036 * Term Loan Indebtness: $13,893,149.32 Marble Point Credit Management LLC 600 Steamboat Road, 2nd Floor Greenwich, CT 06830 * Term Loan Indebtness: $26,396,230.53 Medalist Partners, LP 12 East 49th Street, 38th Floor New York, NY 10017 * Term Loan Indebtness: $4,695,427.51 MJX Asset Management LLC 12 E 49th Street, 38th Floor New York, NY 10017 * Term Loan Indebtness: $34,526,518.51 Teachers Advisors LLC 8500 Andrew Carnegie Boulevard Charlotte, NC 28262 * Term Loan Indebtness: $24,210,237.41 Five Arrows Managers North America LLC 633 West 5th Street, Suite 6700 Los Angeles, CA 90 * Term Loan Indebtness: $6,349,594.00 WhiteStar Asset Management, LLC Crescent Court, Suite 1175 Dallas, TX 75201 * Term Loan Indebtness: $5,792,323.01 Trinitas Capital Management, LLC Crescent Court, Suite 1175 Dallas, TX 75201 * Term Loan Indebtness: $14,180,980.79 Wells Fargo Bank, N.A. 45 Fremont St, Floor 29 San Francisco, CA 94105 * Term Loan Indebtness: $5,360,238.89 ZAIS Group, LLC 101 Crawfords Corner Road, Suite 1206 Holmdel, NJ 07733 * Term Loan Indebtness: $21,550,126.89 Investcorp Credit Management US LLC 280 Park Avenue, 36th Floor New York, NY 10017 * Term Loan Indebtness: $3,915,844.53 Canyon Capital Advisors, LLC 2000 Avenue of the Stars, 11th Floor Los Angeles, CA 90067 * Term Loan Indebtness: $2,923,766.67 Canyon CLO Advisors LLC 2000 Avenue of the Stars, 11th Floor Los Angeles, CA 90067 * Term Loan Indebtedness: $1,949,177.78 Benefit Street Partners 399 Boylston Street, Suite 901 Boston, MA 02116 * Term Loan Indebtedness: $29,144,206.26 Crescent Capital Group, LP 11100 Santa Monica Blvd, Suite 2000 Los Angeles, CA 90025 * Term Loan Indebtedness: $20,577,729.66 Rockford Tower Capital Management, LLC 299 Park Ave, Suite 40 New York, NY 10171 * $9,328,590.00 Par-Four Investment Management, LLC 50 Tice Boulevard Woodcliff Lake, NJ 07677 * Term Loan Indebtedness: $7,340,041.07 Counsel for the Ad Hoc Group of Term Loan Lenders can be reached at: PORTER HEDGES LLP Aaron J. Power, Esq. 1000 Main Street, 36th Floor Houston, TX 77002-2764 Telephone: (713) 226-6000 Facsimile: (713) 226-6248 Email: apower@porterhedges.com - and - GIBSON, DUNN & CRUTCHER LLC Scott J. Greenberg, Esq. Matt J. Williams, Esq. Keith R. Martorana, Esq. Jeremy D. Evans, Esq. 200 Park Ave. New York, NY 10166 Tel: (212) 351-4000 Fax: (212) 351-4035 Email: sgreenberg@gibsondunn.com mjwilliams@gibsondunn.com kmartorana@gibsondunn.com jevans@gibsondunn.com A copy of the Rule 2019 filing, downloaded from PacerMonitor.com, is available at https://bit.ly/2SM1kbz 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. TARGA RESOURCES: S&P Affirms 'BB' ICR; Outlook Stable ----------------------------------------------------- S&P Global Ratings affirmed its 'BB' issuer credit rating on Targa Resources Corp. following the company's announcement that it has authorized a $500 million share repurchase plan. At the same time, Targa announced that it forecasts its EBITDA will be at or near the high end of its previously provided outlook while its net growth capital spending will be at the low end of its previous guidance. "The stable outlook reflects our expectation that Targa will maintain leverage of about 5.5x in 2020 and 2021 if it uses all of the $500 million available under its share repurchase plan," S&P said. S&P views Targa's announcement that it has authorized a $500 million share repurchase plan as a credit-negative event. Targa took numerous actions to reduce its debt in March 2020 when commodity prices collapsed, including a 90% reduction to its common dividend payout, which amounts to about $750 million in annual savings. Additionally, the company announced that it reduced its expected 2020 operating and G&A expenses. Furthermore, Targa also lowered its capital spending plans for 2020. However, S&P views the company's recent announcement that it has authorized a $500 million share repurchase plan as a credit-negative event. Management also announced that it expects its EBITDA to be at or around the high end of its previously provided outlook while its net growth capital spending will be at the low end of its previous guidance. S&P views the share repurchase plan as a shareholder-friendly activity. "The stable outlook on Targa reflects our expectation that the company will maintain leverage of about 5.5x in 2020 and 2021 if it uses all of the $500 million available under its share repurchase plan. If the company does not use all of the $500 million available on the stock repurchase plan, we would expect the company's leverage to be lower than 5.5x," S&P said. The company took steps to reduce its debt in early 2020, including decreasing its net growth capital spending, cutting down on its operating and G&A expenses, and implementing a 90% reduction to its common dividend payment. However, S&P views Targa's recently announced share repurchase program as a clear credit-negative event. "We would consider taking a negative rating action on Targa if we expect its leverage to remain close to 6x for a sustained period, which would likely be due to lower-than-expected volumes on its assets. This could occur if drilling in the Permian remains at very low levels for an extended period. The company's leverage could also increase due to aggressive financial policies," S&P said. "We view a positive rating action on Targa as unlikely in the near term. However, we would consider taking a positive rating action if the company demonstrated a commitment to maintaining leverage of less than 4.5x for a sustained period. This could occur if industry fundamentals improve significantly and Targa maintains a more conservative financial policy," the rating agency said. TERRANCE J. MCCLINCH: Limited Discovery Authorized in Palsa Suit ---------------------------------------------------------------- Bankruptcy Judge Michael A. Fagone authorized the parties in the case captioned as, Joseph A. Palsa, in his Capacity as Trustee Under the Arthur L. McClinch Trust Dated April 3, 1981, Plaintiff. V. Terrance J. McClinch, Defendant, Adv. Proc. No. 20-1004 (Bankr. D. Maine) to conduct limited discovery. Judge Fagone said the discovery must be completed by Nov. 2, 2020. In this case, the Plaintiff filed a Motion to Dismiss Counterclaims with Prejudice and the Defendant filed a timely Objection. Three days prior to the scheduled hearing on the motion to dismiss, the Plaintiff submitted the Declaration of Kyle G. DeValerio, Esq. The declaration represents an effort to authenticate four documents, all of which appear to have been issued by the Fairfield (Connecticut) Probate Court. At a hearing on the motion to dismiss on August 20, 2020, the Defendant urged the Court to strike the DeValerio declaration on two grounds. First, the Defendant argued that the declaration was not timely filed under D. Me. LBR 9013-2. Second, the Defendant argued that the documents attached to the declaration are not properly considered by the Court in ruling on a motion under Fed. R. Civ. P. 12(b)(6). In an attempt to put a finer point on it, the Defendant argued that the Plaintiff could "save the documents for summary judgment or trial and then raise the issues again." While the Defendant's attempt to stave off a dismissal of his counterclaims is understandable, the Court saw things differently. Perhaps there is room to question the timing of the filing of the DeValerio declaration or to argue about the propriety of considering the documents appended to that declaration in connection with a motion to dismiss, Judge Fagone said. But the result of any such questioning should not be a denial of the motion to dismiss with an inexorable march through expensive discovery, motion practice, and trial, particularly when a more targeted approach may cure any unfair prejudice to the Defendant from the timing of the filing and, at the same time, foster a just, speedy and inexpensive determination of the Defendant's counterclaim and at least one of the affirmative defenses raised by the Plaintiff. The Court, therefore, issued an order authorizing the parties to conduct limited discovery with respect to the following factual issues: 1. Whether the Defendant was afforded an opportunity to participate in the Connecticut Probate Proceedings; 2. Whether, and if so, when the Defendant received notice of the existence of the Connecticut Probate Proceedings; 3. What, if any, documents were sent to Defendant in connection with the Connecticut Probate Proceedings; 4. Whether the Defendant actually received documents sent to him in connection with the Connecticut Probate Proceedings; and 5. Any other aspect of the Connecticut Probate Proceedings that is, or may be, material to the Plaintiff' request for a dismissal of the Defendant's counterclaim on res judicata grounds. All such discovery must be completed on or before Nov. 2, 2020. Judge Fagone authorized the Plaintiff to file a supplement to the motion to dismiss on or before Nov. 16. The Defendant was authorized to file a supplement to his objection to the motion to dismiss on or before Nov. 30. The supplements should be limited to facts that are, or may be, material to the Plaintiffs' res judicata argument. In his July 22, 2020 order, Judge Fagone said the case is a core proceeding and there is no Constitutional impediment to the entry of judgment. The Court will hear and determine the proceeding. According to Judge Fagone, the Plaintiff's complaint does not seek to augment the estate; rather, the Plaintiff's complaint appears to be an effort to assert a claim against the estate (whether or not the confirmation order is revoked under 11 U.S.C. section 1144). The Court concluded that the case is a core proceeding. A copy of the July 22 order is available at https://bit.ly/2XcQ1vE from Leagle.com. A copy of the Court's Limited Discover Order dated August 24, 2020 is available at https://bit.ly/35PstlP from Leagle.com. Terrance J. McClinch sought Chapter 11 protection (Bankr. D. Maine Case No. 18-10568) on Sept. 27, 2018. The Debtor tapped D. Sam Anderson, Esq., at Bernstein Shur Sawyer & Nelson. TESLA INC: S&P Raises ICR to 'BB-' on Strong Competitive Position ----------------------------------------------------------------- S&P Global Ratings raised its issuer credit rating on Tesla Inc. to 'BB-' from 'B+' and its issue-level ratings on the company's unsecured debt to 'BB-' from 'B+'. The stable outlook reflects S&P's view that Tesla's competitive position remains solid and its credit metrics will stay in line with the rating agency's expectations. Improved execution, increasingly efficient production, and global expansion continue to strengthen the company's competitive position. On Oct. 2, 2020, the company announced that it had delivered nearly 140,000 vehicles in the third quarter, which was above its expectations. In its latest forecast, S&P expects Tesla deliveries of over 470,000 in 2020. While the battery electric vehicle (BEV) market remains a sliver of total U.S. auto sales, Tesla's BEV market share in the U.S. stood at almost 80% in the first half of 2020. Production at its existing facilities continues to improve. Although its Model Y production line was only operating for about four months in the first half of 2020 due to shutdowns, it exited the second quarter with Model Y production running at installed capacity. This ramp up in production was significantly faster than its initial Model 3 ramp up, which took over nine months to reach the same weekly rate. "We expect further improvements in efficiency, cost, and technology as Telsa builds on lessons learned from prior factories. We think deliveries could reach over 800,000 in 2021, as production for Model Y ramps up," S&P said. Environmental, social, and governance (ESG) credit factors for this credit rating change: -- Health and safety The stable outlook reflects S&P's view that Tesla's financial performance will stay in line with its expectations, namely: a weighted free operating cash flow (FOCF) to debt ratio above 5%, even as it expands its manufacturing footprint around the world. S&P could consider raising the ratings if: -- The company continues to ramp up its production of its Model 3 in China and the Model Y, and demonstrates consistent operational improvements. -- S&P expects demand for Tesla's EVs will continue to grow, even as the number of EVs from competing automakers proliferate and provide a wider selection to consumers. -- Gross margins are stable to increasing and FOCF to debt is consistently greater than 10%. S&P could lower the rating if: -- The company encountered problems expanding its manufacturing footprint around the world. -- Demand for EVs does not match the newly installed capacity. Competition from traditional automakers intensifies and draws customers away from buying Tesla's vehicles. -- FOCF to debt falls below 5% on a sustained basis. TJ HOLDINGS: Seeks to Hire Crabtree CPA as Accountant ----------------------------------------------------- TJ Holdings, Inc. seeks approval from the U.S. Bankruptcy Court for the District of Massachusetts to employ Crabtree CPA & Associates to prepare and file its tax returns. Crabtree's standard hourly rates are as follows: Partner $225 Manager $150 Senior Accountant $120 Staff Accountant $100 Junior $75 Administrative & Bookkeeping $75 Crabtree CPA is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Douglas Crabtree, CPA Crabtree CPA & Associates 426 North St Hyannis, MA 02601 Phone: +1 508-790-2727 About TJ Holdings Inc. TJ Holdings, Inc. filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 20-11732) on August 21, 2020, listing under $1 million in both assets and liabilities. The Law Office of Peter M. Daigle is the Debtor's counsel. TMK HAWK: S&P Raises ICR to 'CCC'; Outlook Negative --------------------------------------------------- S&P Global Ratings raised its issuer credit rating on U.S.-based TMK Hawk Parent Corp. (Trimark) to 'CCC' from 'SD' (selective default) after the company completed a distressed exchange, amended its first-lien credit agreement, and placed a new $120 million super-priority first out term loan. S&P also raised its issue-level rating on the company's remaining unexchanged $261.5 million first-lien term loan and $235 million second-lien term loan to 'CC' from 'D'. The '6' recovery rating indicates S&P's expectation for negligible recovery (0%-10%; rounded estimate: 0%). The 'CC' rating reflects the debt's subordinated payout status relative to the company's existing asset-based lending (ABL) facility and new first- and second-out term loans. At the same time, S&P is assigning its 'B-' issue-level rating and '1' recovery rating to the company's new $120 million super-priority first out term loan due 2024 and its 'CCC' issue-level rating and '3' recovery rating to the $307.5 million super-priority second out term loan. The '1' recovery rating indicates S&P's expectation for very high recovery (90%-100%; rounded estimate: 95%) for lenders in the event of a payment default. The '3' recovery rating indicates S&P's expectation for meaningful recovery (50%-70%; rounded estimate: 60%) for lenders in the event of a payment default. "We believe Trimark's capital structure remains unsustainable, especially amid the current uncertain economic environment, which could continue to pressure its operating performance and cash flow. The company continues to operate with an unsustainable level of leverage and its business remains focused on distributing products to the hard-hit restaurant and away-from-home food sector," S&P said. Although its demand has sequentially improved from the very depressed levels in late March and April, it remains relatively weak and there's still significant uncertainty around the severity and duration of the coronavirus pandemic's effects on the foodservice equipment and supplies (FE&S) industry. Specifically, S&P believes there could be a sustained shift in consumer behavior toward working from home and less dining out. Industry demand may also be impaired for the long term due to the sizable job losses and business closures both at restaurants and in other related industries. S&P expects Trimark's sales and profits to decline materially in fiscal year 2020 relative to its pre-coronavirus levels, which will lead to elevated leverage and materially negative FCF. Therefore, S&P continues to view the company's capital structure as unsustainable and forecast that its leverage will remain elevated at about 15x in 2021 while it generates negative FCF. Trimark's liquidity could tighten again if a spike in coronavirus cases causes consumers to avoid food-away-from-home establishments or if governments tighten their restrictions on restaurants, including possible shutdowns. The company could have a hard time sustaining sufficient interest coverage absent a substantial improvement in its demand. "The negative outlook reflects the potential that we will lower our rating on Trimark if it is unable to improve its operating performance and we believe a default is inevitable in the next six months," S&P said. S&P could lower its ratings on Trimark if it is unable to improve its revenue and EBITDA performance while rebuilding its working capital, leading to a further deterioration in its FCF and heightened risk for a default in the next six months. This could occur if restrictions on restaurant capacity, widespread permanent restaurant closures, or consumer hesitancy to resume consuming food away from home continues to hurt its sales. This could also occur if infection rates spike and lead to additional lockdowns, a protracted recession and high unemployment rates dramatically reduce consumer discretionary spending on food-away-from-home products, or its competition escalates. "We could take a positive rating action on Trimark if it stabilizes its revenue and EBITDA, leading it to generate positive FCF, maintain a sufficient forecast covenant cushion, and report EBITDA interest coverage approaching the low-1x area. This could occur if infection rates subside and the volume of away-from-home food consumption steadily expands as macroeconomic conditions improve," S&P said. TOWNHOUSE HOTEL: Seeks Approval to Hire Scott Alan Orth as Attorney ------------------------------------------------------------------- Townhouse Hotel, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Florida to hire the Law Offices of Scott Alan Orth, P.A. as its attorney. The professional services the attorney will render are as follows: a. advise the Debtor with respect to its powers and duties; b. advise the Debtor with respect to its responsibilities in complying with the U.S. Trsutee's Operating Guidelines and Reporting Requirements; c. prepare legal documents; d. protect the interest of the Debtor in all matters pending before the court; e. represent the Debtor in negotiation with its creditors in the preparation of a plan. The firm 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: Scott Alan Orth, Esq. Law Offices of Scott Alan Orth, P.A. 3860 Sheridan St., Suite A Hollywood, FL 33021-3624 Telephone: (305) 757-3300 Facsimile: (305) 757-0071 Email: scott@orthlawoffice.com About Townhouse Hotel LLC Townhouse Hotel LLC, a Miami Beach, Fla.-based boutique hotel, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 20-19997) on September 16, 2020. The petition was signed by Abraham Kramer, manager of G & A Miami LLC, manager of Townhouse Hotel LLC. At the time of the filing, Debtor had estimated assets of between $1 million and $10 million and liabilities of between $500,000 and $1 million. Judge Robert A. Mark oversees the case. The Law Offices of Scott Alan Orth, P.A. is Debtor's legal counsel. TRANSMONTAIGNE PARTNERS: Fitch Affirms 'BB' IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings has affirmed TransMontaigne Partners LLC's (TLP) Long-Term Issuer Default Rating at 'BB' and affirmed the senior unsecured rating at 'BB'/'RR4'. The Rating Outlook is Stable. TLP owns and operates refined product storage and terminaling assets in 20 states across the U.S. Refined product terminaling companies receive, store, treat, blend, and distribute foreign and domestic cargos to and from oil refineries, wholesalers, retailers and ultimate end users. Fitch expects revenue to be stable and predictable. Essentially all revenues come from fee-based services, while roughly 75% of total revenue is underpinned by term contracts with fees earned from take-or-pay minimum volume commitments. By revenue, approximately 42% percent of contracts have at least three years in remaining duration. Roughly 28% percent of contracts have one year or less in remaining duration, meaning they could be terminated in a year or less. However, 69% of these contracts were previously renewed by the customer. The ratings are reflective of the fixed-fee, long-term contracted business and the beneficial market conditions for storage. As a result of reduced demand and pricing for crude oil and refined petroleum products that began in March 2020, TLP benefited from stronger demand for storage capacity, and had approximately 97% of storage capacity contracted as of 2Q20. Under more normal operating conditions, the amount of contracted assets usually fluctuates around the low to mid-90% level. The ratings also consider that counterparty credit risk has been somewhat mitigated by the quality of the company's diverse customer base and TLP's ability to place a lien on product held in its storage tanks. Leverage (total debt with equity credit/operating EBITDA) improved from elevated levels in 2017. Fitch expects leverage to approach the 4.0x positive sensitivity over the forecast period. The company's size constrains its credit profile at the 'BB' level. KEY RATING DRIVERS Coronavirus Impacts: The ongoing coronavirus pandemic and related stay-at-home orders that began in March 2020 across the U.S. and Canada led to a decrease in travel and economic activity, resulting in a decline in the pricing and demand of refined products. The refined products futures market shifted into contango (the future price of the commodity is higher than the spot price) in 2Q20, resulting in strong demand for storage capacity. TLP benefited from these market conditions as almost all previously uncontracted tank capacity is contracted. Terminaling throughput across the system was conversely down slightly yoy in 2Q20. However, these revenues make up a smaller relative proportion of consolidated revenue. Furthermore, TLP's terminaling services agreements include minimum volume commitments whereby TLP will receive payment whether or not product is moved through its system. Contracts Provide Predictable Revenue: TLP generated stable cash flows, with approximately 75% of revenues from storage and terminaling services with take-or-pay/minimum volume commitments in fiscal 2019 through 2Q20. Under the terms of these contracts, payment is made whether or not customers use the related throughput and storage services, essentially providing a revenue floor. These multiyear minimum volume commitment contracts form the backbone of TLP's strategy to generate stable cash flows. Essentially all of TLP's roughly 39 million barrels (bbl) of storage capacity is contracted as of 2Q20. Approximately 42% of TLP's contracts have three or more years of term remaining. TLP earns the balance of its revenue from uncontracted ancillary services, including heating and mixing of stored products, product transfer, pipeline tariffs, railcar handling, butane blending, wharfage and vapor recovery. Contract Renewal Risk: The U.S. Gulf Coast refinery complex is the main product source for TLP. This refinery complex has no superior large competitor region anywhere in the world. End users of the refined products that migrate through TLP's systems exhibit very low-price elasticity of demand. The competitive strength of the Gulf Coast refineries and the durability of end-user demand combine to mitigate the risk that contracts due to expire in the short and medium term might be replaced by much lower priced contracts. Fitch views positively the fact that from inception, the weighted (by revenue) average customer life for contracts of one year in duration or less is just over seven years, which increased from 6.44 years one year ago. Mix of Counterparties: TLP has a good track record avoiding losses due to counterparty financial distress. TLP is able to place a lien on customers' inventory that resides in TLP storage tanks. The company has had little to no collection issues. Approximately 90% of revenue as of 2Q20 is generated from 20 customers and TLP has a diverse set of customers that include major integrated energy companies, national oil companies, independent refiners, large fuel retailers and global commodity trading firms. As for contract cliffs, the company has a well-spread portfolio of contracts with respect to inception date. Recent results of repricing expiring contracts have been a boost to EBITDA. New contracts are generally agreed upon with five-year terms plus extension options. It is possible the evolution of the portfolio may exhibit some large contract expirations. Sponsor Relationship: ArcLight Energy Partners Fund VI, L.P. (ArcLight) has been invested in TLP since early 2016 and took TLP private in February 2019. ArcLight has a wealth of expertise in operational best practices and financial structuring. The firm invested or committed $23 billion in equity capital in the energy sector since 2001. Improving Leverage: TLP's leverage has been improving following the West Coast terminals acquisition-related increase to just under 5.5x in 2017. Aside from the acquisition, debt has been used to fund growth capex, given there have been no direct equity infusions since 2013. Leverage historically remained lower, in the 2.8x-3.4x range, dating back to 2013. Fitch forecasts leverage to approach 4.0x over the forecast period as EBITDA is bolstered by the completion of attractive growth projects and higher near-term storage utilization, as well as expected debt reduction from reduced quarterly/annual distributions. DERIVATION SUMMARY TLP is a terminaling company operating in 20 U.S. states, with slightly less capacity than its closest comparable within Fitch's midstream coverage universe, ITT Holdings LLC (BBB-/Negative). Both companies operate diversified petroleum liquids storage assets strategically located across the U.S. ITT has some operations in Canada and TLP has assets that distribute product into Mexico. Both companies have assets that make up critical portions of the regional petroleum value chain where operated. ITT is roughly 13% larger than TLP by storage capacity. However, ITT is approximately double the size of TLP by EBITDA. Leverage is another factor, as Fitch expects TLP's 2020 leverage to decline closer to 4.0x, while expecting ITT's leverage to rise modestly above 4.2x driven by capex spending. Similarly rated Buckeye Partners, L.P. (BPL, BB/Stable) is larger in terms of size and scale, and had greater asset base diversity compared with TLP's focus on terminaling operations. EBITDA is closer to $1 billion, significantly larger than TLP, and BPL operates in the crude oil, refined products pipelines and storage terminal segments. While TLP's operations are smaller in size and more concentrated on terminaling and storage, leverage compares favorably and is expected to be just above 6.0x for BPL at YE 2020 before declining closer to 5.0x at the end of 2021. Compared with lower rated Zenith Energy U.S. Logistics Holdings, LLC (B-/Negative), TLP is larger and has a stronger credit profile. Both companies are similar in terms of operating liquids terminaling and storage assets, but are dissimilar in terms of size, with TLP having significantly greater storage capacity and generating roughly double the annual EBITDA. Zenith derives approximately 66% of its revenues from take-or-pay contracts with a tenor of approximately 2.5 years. Zenith's leverage at YE 2019 was 10.0x, more than double TLP's. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer: -- Oil and refined product production consistent with the Fitch price deck, including 2021 and 2022 West Texas Intermediate of $42/bbl and $47/bbl, respectively; -- Several expansion projects with fully contracted customer commitments are completed and placed into service by mid-2021. Future capex spending does not meaningfully benefit results within the forecast period; -- Current year and future spending needs beyond cash flows from operations are funded by the company's existing revolving credit facility; -- A portion of contracts that have terms remaining of less than one year and are non-evergreen are assumed to be renewed at lower rates; -- Cash distributions insignificantly in excess of estimated TLP Finance Holdings, LLC (Holdings) debt service. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- A positive rating action could occur if the storage and terminaling business grows to $300 million-$350 million of EBITDA per annum, total debt with equity credit to operating EBITDA is expected to be below 4.0x for a sustained period and the company grows at the rate that it has in the recent past. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- A significant reduction in the percent of revenues from take-or-pay contract terms, or the adoption of a strategy to sign new contracts that are two years or less. Given the breakdown of total debt into a credit facility committed amount of $850 million and the senior unsecured notes, and given the impact of Recovery Ratings on the senior unsecured rating, negative actions may trigger multinotch downgrades in the senior unsecured rating; -- Leverage greater than 4.8x for a sustained period. Multinotch downgrades are possible; -- Impairments to liquidity; -- Cash distributions significantly in excess of estimated Holdings debt service obligations. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: Considering TLP's size, scale and plans for growth capex, Fitch views its liquidity as adequate. The company had $300 million of senior unsecured notes due 2026 and $349 million of borrowings on its senior secured revolving credit facility (held at a TLP subsidiary) as of June 30, 2020. The borrower for the credit facility is TransMontaigne Operating Company, L.P., which is also one of the guarantors on an unsecured basis of the senior unsecured notes outstanding at TLP. The company had approximately $501 million of unused capacity on its $850 million credit facility. TLP had a cash balance of $928,000 in addition to the revolver availability. The revolving credit facility matures on March 13, 2022. Fitch expects growth capex to be funded by draws on the revolver and cash flow from operations in the near term. 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. TRAVERSE MIDSTREAM: S&P Affirms 'B' ICR on Term Loan Amendment -------------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on Traverse Midstream Partners LLC. At the same time, S&P is affirming its 'B' issue-level rating on Traverse's term loan B. Following the principal reduction, S&P is revising its recovery rating to '3', indicating meaningful recovery (50%-70%; rounded estimate 50%) in the event of a payment default. The previous recovery rating of '4' indicated average recovery (30%-50%; rounded estimate 45%). "The stable outlook reflects our expectation of debt to EBITDA below 8.5x in 2020, declining to about 8x in 2021 following the term loan principal reduction," S&P said. The affirmation of S&P's 'B' issuer credit rating on Traverse Midstream reflects the announced amendment to its $1.4 billion term loan B maturing in September 2024. The amendment will allow for the sale of Traverse's 25% interest in Ohio River System, a dry gas gathering pipeline. While Traverse is not planning to sell Ohio River in the near term, the amendment gives the company flexibility to do so to reduce leverage in the future, if needed. It will also allow Traverse to make capital calls to Rover Pipeline to cover previously incurred expenditures related to slip repair and soil stabilization project. Lenders will receive a $53 million of principal reduction at closing of the transaction, additional $25 million reduction paid in March and June 2021, and a pricing increase. S&P's rating also reflects the differentiated credit quality between the company and its investees, Rover Pipeline and Ohio River. Traverse does not have other substantive assets and relies on distributions from the two investees to service its term loan B and fully drawn $53 million revolving credit facility (unrated). S&P's assessment of Traverse's credit profile incorporates its financial ratios, as well as Rover's and Ohio River's cash flow stability, ability to influence investees' financial policy, and ability to liquidate investments in both entities to repay the term loan. Following the term loan principal reduction, S&P forecasts debt to EBITDA of below 8.5x in 2020, declining to about 8x in 2021, and an EBITDA interest coverage ratio of 1.8x-2x. S&P assesses Traverse's financial metrics as negative due to the elevated leverage ratios. S&P's assessment takes into account Rover's and Ohio River's tangible counterparty risk as more than half of their combined revenue comes from shippers in the 'CCC' and low 'B' ratings categories. The multinotch downgrades of Ascent Resources Utica Holdings LLC, Antero Resources Corp., Gulfport Energy Corp., and Range Resources Corp. earlier this year indicate an overall deterioration of the shippers' credit quality. However, counterparty risk is partially mitigated by letters of credit that can provide 12 to 18 months of support if the lower-quality shippers fail to honor their contractual obligations. S&P views Traverse's cash flow stability as positive because the rating agency expects it to receive steady distributions from Rover over the next two years. Distributions from Rover make up about 80% of Traverse's EBITDA and are supported by Rover's fully operational status, pipeline utilization rate of more than 90%, and low maintenance capital expenditures projected in the medium term. While Rover's and Ohio River's contract profiles consist of take-or pay agreements, S&P notes a relative lack of diversity as more than half of revenues come from speculative-grade shippers. Also, Ohio River pipeline's utilization rate remains relatively low, about 55% of its total capacity. S&P assesses Traverse's corporate governance and financial policy as positive, due to significant governance rights over Rover. Traverse has the right to veto any changes to Rover's distribution policy, including incurrence of debt above a certain threshold. In addition, Rover is required to distribute all of its free cash flows to Traverse and ET Rover Pipeline LLC, a joint venture between BCP Renaissance Parent LLC and Energy Transfer L.P. While the governance rights over Ohio River are not as strong, S&P's assessment remains positive because it accounts for less than 20% of Traverse's cash flows. "We view Traverse's ability to liquidate its investments in Rover and Ohio River as negative due to their private ownership status," S&P said. The stable outlook reflects S&P's expected debt to EBITDA below 8.5x in 2020 declining to about 8x in 2021, following the repayment of the $75 million term loan principal balance. Traverse's credit metrics are supported by the distributions from Rover and Ohio River underpinned by take-or-pay contracts, and letters of credit posted by the shippers. "We could lower our ratings if distributions from Rover or Ohio River decline due to inability of the shippers to meet their contractual agreements. In addition, we could take a negative rating action if debt to EBITDA deteriorates to 9x or above, or EBITDA interest coverage ratio declines below 1.5x on a sustained basis," S&P said. "Although unlikely in the near term, we could consider a positive rating action if the credit quality of Traverse' shippers improved, while the company maintained debt to EBITDA of less than 8.5x on a sustained basis," the rating agency said. TRILOGY INTERNATIONAL: Fitch Affirms CCC+ Issuer Default Rating --------------------------------------------------------------- Fitch Ratings has affirmed all of Trilogy International Partners, LLC's ratings, including its 'CCC+' Issuer Default Rating (IDR). The ratings affirmation reflects the expected increase in near-term liquidity resulting from a transaction with existing bondholders and shareholders to raise $50 million of new notes by Trilogy International South Pacific LLC, (TISP), a subsidiary that owns the equity interests in TIP Inc.'s New Zealand business. The proceeds of the TISP notes would be used to fund the payment of interest on the existing $350 million secured notes, and to pay interest on the TISP notes. The notes transaction would create a first-lien creditor class ahead of the existing $350 million senior secured notes following noteholder consent approval. Trilogy has indicated that holders of greater than 75% in principal amount of the outstanding existing notes intend to provide their consents in response to the solicitation. Fitch anticipates the transaction would reduce recovery prospects such that, the recovery rating for the $350 million secured notes would lower to 'CCC+'/'RR4' from 'B-'/'RR3' following the consent approval that is anticipated to occur on Oct. 20, 2020. The consents being solicited would also authorize amendments to the indenture governing the secured notes to permit TIP Inc.'s operating subsidiary in Bolivia, NuevaTel, to be sold for non-cash consideration, subject to certain terms and conditions. The transaction does not address the upcoming maturity of the $350 million senior secured notes in May 2022 and increases debt in the capital structure, which Fitch views as a credit negative. Fitch believes an inability to successfully complete an asset sale of the NuevaTel operating assets and a refinancing of the secured notes before the notes become current in May 2021 could lead to a ratings downgrade and increase the risk for a distressed debt exchange (DDE). KEY RATING DRIVERS Near-term Liquidity Headroom Improved: The $50 million of new secured notes will improve liquidity reserves in the near to medium term following the expected consent approval. The consent solicitation is also expected to enhance M/A flexibility by permitting TIP Inc.'s operating subsidiary in Bolivia, NuevaTel, to be sold for non-cash consideration, subject to certain terms and conditions. Fitch believes Trilogy, which was in discussions with potential buyers for Bolivian assets prior to the pandemic, will renew sale discussions following the election in 4Q20 that could allow for greater regulatory clarity. Given the numerous unknowns and uncertainties as to the overall effects from the pandemic, combined with political and regulatory environment in Bolivia, this creates additional uncertainty around timing for any asset sale. Thus, Fitch's base case does not consider an asset sale of NuevaTel. OpCo Capital Structure: Both operating subsidiaries have also taken steps during 2020 to address near-term maturities and increase liquidity. 2degrees completed a bank syndication for a new three-year senior facilities agreement in February 2020 with an upsized aggregate commitment for NZD285 million, or USD183 million based on FX in June 2020, from NZD250 million. In August 2020, Trilogy announced that NuevaTel commenced a two series bond offering of up to USD24.2 million. NuevaTel will use the net proceeds of the offering to repay existing indebtedness of approximately USD11.8 million, which matures within the next year, as well as for capital expenditures. Inefficient OpCo/HoldCo Structure: The corporate structure is less than optimal when upstreaming dividends due to cash leakage from withholding taxes and minority interest distributions in both Bolivia and New Zealand. Upstreaming dividends are also subject to FX risk. NuevaTel was historically a dividend contributor and paid dividends of more than USD300 million to Trilogy since 2008. However, due to the deterioration in the Bolivian operations, Trilogy has become heavily reliant on dividends from New Zealand operations. While Fitch believes 2degrees could upstream sufficiently cash to the HoldCo level, this would require the New Zealand operations to materially reduce capital investment absent Trilogy's $50 million new bond issuance, which could begin to affect 2degrees' competitive position in the medium-to-longer term. The $50 million debt issuance at TISP allows 2degrees more flexibility to make growth related investments. Over the medium-term, Fitch believes a sale of the Bolivian operation is key strategically as net proceeds could be used to reduce debt at the HoldCo level while allowing Trilogy further opportunities to simplify and create a more sustainable organizational structure that eliminates the current friction on moving cash to the HoldCo level. Fitch believes an inability to successfully complete an asset sale of the NuevaTel operating assets and a refinancing of the secured notes before the notes become current in May 2021 could lead to a ratings downgrade and increase the risk for a distressed debt exchange (DDE). Coronavirus Effects on Telecoms: In general, Fitch does not expect the same level of disruption to telecoms as other sectors from the coronavirus pandemic, as there are recurring payments from subscription-based plans for wireless and broadband that are generally a high priority consumer payment. Operators have material flexibility to reduce costs in the short term, due in part to a variable cost structure and the ability to flex capital intensity in the short to medium if required. Fitch expects the wireless industry will experience an increase in bad debt expense, given the abrupt changes in general economic conditions resulting from the coronavirus. NuevaTel experienced material disruption in its ability to receive cash payments from its subscriber base due to the restrictive lockdowns. In New Zealand, roaming revenues, which are in the low-single digits as a percentage of service revenues, were negatively affected due to travel restrictions. 2degrees and NuevaTel also have higher exposure to pre-paid service revenues as subscribers have lowered usage during the lockdown period. New Zealand has effectively contained the coronavirus, which has helped support business reopenings, although borders remain essentially closed. Cost management actions in New Zealand include a reduction in 2degrees' workforce, discretionary capex and other non-essential projects with the flexibility to further reduce spending as required. Fitch believes these steps should result in relatively stable levels of cash generation at 2degrees. In Bolivia, the coronavirus lockdowns restricting movement created material challenges with cash collections due to closed retail stores. Fitch believes while subscriber payments will improve throughout the remainder of 2020, as the economy reopens, Bolivia will continue to experience EBITDA pressure. As such, the company will need to aggressively manage costs and capital spending to preserve liquidity particularly if the shortfall in operating performance is materially greater than expected. The new bond offering is expected to support NuevaTel's liquidity position. Good Momentum in New Zealand: Prior to the coronavirus pandemic, the New Zealand operations demonstrated good operational momentum with post-paid churn declining close to historical levels, increased post-paid subscribers and expanded EBITDA margins that continued into early 2020. 2degrees generated service revenue and EBITDA growth during 2019, excluding the effects from FX, and the new revenue standard of 4% and 12%, respectively. On an organic basis, service revenue and EBITDA during the second quarter 2020 increased 5% (-3% reported) and 12% (-3% reported), respectively. 2degrees' market challenger strategy has enabled the company to take market share from the incumbents. The operating environment is supported by a stable, three-competitor wireless market. The company improved execution around its sales strategy by bundling broadband packages, which is a lower cost acquisition channel. The results were an increase in 2019 of broadband subscribers of 26,000 compared with 13,000 in 2018. Bolivian Operations Challenged: Significant cash flow deterioration occurred in the Bolivian operations during the past several years. This was due to the competitive environment from mobile number portability, social unrest from political instability and aggressive promotional offers resulting in significant subscriber and ARPU erosion. Pre-paid subscribers declined by roughly 700,000 subscribers to approximately 1.1 million and post-paid subscribers declined by roughly 30,000 subscribers to approximately 314,000 since 2016. Blended ARPU declined to USD8.40 as of YE 2019 compared with USD9.70 in 2016 with further declines during first-half of 2020 to USD7.52. As a result, LTM EBITDA declined to approximately USD22 million from approximately USD82 million in 2016. Increased Leverage Expected: Fitch expects Trilogy's core telecommunications leverage, measured as total debt/EBITDA, will increase to the low-to-mid 6x range in 2020 compared with 4.3x in 2019, adjusted for handset-related financial services operations. The leverage increase is driven by EBITDA pressure related to the deterioration in the Bolivian operations, the negative effects from the coronavirus pandemic and the expected increase in debt. To determine core telecom leverage, Fitch applied a one-to-one debt/equity ratio to the company's installment plan device receivables. DERIVATION SUMMARY Trilogy's 'CCC+' rating reflects its small scale, material exposure to the higher risk operational environment in Bolivia, challenger brand strategy, low profitability and constrained financial profile. 2degrees in New Zealand and NuevaTel in Bolivia compete against much larger peers in three-competitor markets. Both operating companies maintain market share in the low to mid 20% range with substantial exposure in both markets to lower-valued pre-paid subscribers. The ratings are not constrained by Bolivia's operating environment or Country Ceiling of 'B+', but the company is wholly exposed to FX fluctuations due to its reliance on servicing HoldCo debt from international operations, although the Bolivian boliviano is pegged to the U.S. dollar. 2degrees competes with a former operating subsidiary of Vodafone Group Plc (BBB/Stable) in New Zealand, which has a more expansive scale, geographic scope and financial resources. Vodafone sold the operations to a New Zealand infrastructure company and Canadian asset management firm. In early 2020, 2degrees and Vodafone entered into a network sharing arrangement which supports more efficient capital deployment. In Bolivia, NuevaTel competes against Tigo, S.A., an operating subsidiary of Millicom International Cellular S.A. (MIC; BB+/Stable), which has a much stronger business and financial profile. MIC's ratings reflect the company's geographic diversification, strong brand recognition and network quality. These factors contributed to MIC's leading positions in its key markets and solid cash flow generation. Trilogy's ratings are similar to Oi S.A. (CCC+) with a smaller scale. Oi's ratings reflect weak operating trends and deterioration in the Brazilian operating environment, which will hinder a return to growth. While Oi has adequate liquidity in 2020, its business model and financial performance is unsustainable, relative to capex requirements and debt service, in 2022 and beyond. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer in 2020: -- Consolidated EBITDA of roughly USD100 million. -- Capex materially lower than 2019. -- Consolidated ending cash of at least USD100 million. -- A moderate FCF deficit. -- Annual operating cash costs of roughly USD45 million required for Trilogy at the HoldCo level supported by the USD50 million debt issuance. -- Leverage in the low-to-mid 6x range. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- A recovery in operating performance that demonstrates subscriber growth and ARPU stabilization following the lockdowns within the New Zealand and Bolivian operations; -- Refinancing of the HoldCo notes; -- An asset sale of the Bolivian NuevaTel operations; -- Maintain sufficient liquidity throughout the organizational structure including HoldCo debt service requirements combined with adequate flexibility to make growth-related capital investments in New Zealand to sustain 2degrees' competitive position. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- The inability to complete an asset sale agreement of the NuevaTel operations and a refinancing of the secured notes before the notes become current in May 2021; -- Deterioration in operating performance, driven by subscriber losses and ARPU compression in the mobile segment for New Zealand and/or Bolivian operations, which results in further revenue and EBITDA pressure; -- Trilogy enters into an agreement with HoldCo bondholders that could be classified as a DDE per Fitch's Distress Debt Exchange Rating Criteria; -- Insufficient liquidity due to an inability, or any material limitations, with upstreaming cash from operating subsidiaries. This could include any unforeseen impediment, regulatory or of another nature, in upstreaming cash to the parent level. LIQUIDITY AND DEBT STRUCTURE Limited Liquidity Headroom: Trilogy's consolidated cash, cash equivalents and short-term investments was approximately USD68 million for second-quarter 2020 (compared to USD47 million in the first-quarter) including USD30 million held at 2degrees (compared to USD9 million in the first-quarter), USD31 million held at NuevaTel (compared to USD22 million in the first-quarter) and USD7 million held at the parent level. The expected debt issuance supports improved near-term liquidity for debt service at the HoldCo level. Trilogy does not have a revolving bank facility at the HoldCo level and is subject to FX fluctuations that could negatively affect debt servicing costs at the HoldCo. The company has suspended the dividend at Trilogy International Partners, Inc. of CAD0.02 per common share, roughly CAD1 million. The consolidated leverage debt incurrence covenant, less than or equal to 4.0x, in the HoldCo secured notes, limits additional debt within Trilogy's capital structure. However, carveouts within the indentures offer some additional debt flexibility. Carveouts include debt at the Bolivian subsidiary of USD50 million, permitted receivables financing not to exceed NZD50 million, indebtedness at 2degrees not to exceed the greater of an aggregate total debt of NZD245 million, or on a pro forma basis, consolidated leverage of 2.0x, after incurrence of additional debt and carveouts for spectrum. Both 2degrees and NuevaTel operations have local facilities agreements to provide local debt capacity for operational support. 2degrees completed a bank syndication for a new three-year senior facilities agreement in February 2020 with an upsized aggregate commitment for NZD285 million, or USD183 million based on FX in June 2020, from NZD250 million. The agreement consists of a NZD235 million, or USD151 million, facility that was fully drawn at closing with no amortization requirements, a NZD30 million investment facility or USD19 million, that was fully drawn following the end of second-quarter 2020, and a NZD20 million working capital facility or USD13 million that was undrawn. The senior facilities agreement provides for an uncommitted NZD35 million accordion facility that can be used to fund capex. 2degrees has substantial cushion under its main covenants, including net leverage of not greater than 3.00x until Dec. 31, 2020; 2.75x from Jan. 1, 2021 to Dec. 31, 2021; and 2.50x thereafter. 2degrees must also maintain a total interest coverage ratio of not less than 3.0x. An additional covenant limits permitted distributions to 100% of FCF and requires a leverage ratio of 2.0x, immediately following the permitted dividend distribution. In Bolivia, during first-quarter 2020, NuevaTel entered into an USD8.3 million secured bank loan due July 2021 with Banco Nacional de Bolivia S.A. to repay the outstanding balance under NuevaTel's USD25 million syndicated bank loan facility due 2021. As part of the new agreement, the financial covenant requirement was removed from the new bank loan agreement. NuevaTel also has two other bank loans totaling USD7 million and USD8 million at the time of the initial draw with modest amortization requirements that mature in 2022 and 2023, respectively. The amount outstanding was USD4.8 million and USD6.2 million, respectively, as of June 30, 2020. The 2022 and 2023 bank loan agreements do not contain financial covenants. In August 2020, Trilogy announced that NuevaTel commenced a two series bond offering of up to USD24.2 million. NuevaTel will use the net proceeds of the offering to repay existing indebtedness of approximately USD11.8 million, which matures within the next year, as well as for capital expenditures. The bonds will be secured with certain sources of NuevaTel cash flows. The bonds contain certain financial covenants including a debt service ratio. The debt service ratio will be applicable starting with the first quarter of 2022. The bonds have no recourse to TIP Inc. or its subsidiaries other than NuevaTel. NuevaTel has received commitments for approximately USD19.5 million of the bond offering, including all of Series A (USD9.7 million). The bond offering will be open through October 31, 2020. 2degrees has spectrum-related installment payments required for the 1,800MHz and 2,100MHz license renewal of approximately NZD10 million annually for the next six years starting in early 2021. 2degrees made its final payment related to the 700 MHz license in 2019. Bolivia does not have any further spectrum-related payments due over the ratings horizon following the USD30 million payment in 2019 for the 1900 MHz spectrum renewal. Recovery Considerations The recovery analysis assumes Trilogy would be considered a going concern in a bankruptcy and the company would be reorganized rather than liquidated. Fitch assumed a 10% administrative claim. The Recovery Rating (RR) considers the structural subordination to the local operating subsidiaries' debt. Fitch believes the recovery analysis for Trilogy is best performed using a "sum of the parts" approach, where a waterfall analysis for recovery is performed individually for each operating subsidiary and rolled up to the parent level. Consequently, Fitch determined a going-concern EBITDA for each operating subsidiary. The recovery also takes into account the minority stakes at each operating subsidiary and assigns a proportionate EBITDA to Trilogy. Fitch's recovery analysis includes an additional discount related to the withholding tax the company is subject to in Bolivia of 12.5% and New Zealand of 7.5%. The going-concern EBITDA assumes both depletion of the current position to reflect the distress that provoked a default and a level of corrective action Fitch assumes would have occurred during restructuring or would be priced into a purchase price by potential bidders. The recovery analysis reflects a scenario in which EBITDA declines as a result of continued erosion of the subscriber base in both Bolivia and New Zealand. This is due to aggressive price discounting by the larger, financially stronger competitors that causes a repricing of the subscriber bases and additional challenges for Bolivia, which could be due to a combination of country risk factors including political, social, economic and legal. For Bolivian operations, the going-concern EBITDA of approximately USD15 million, represents an approximate 33% decline to LTM EBITDA as of June 30, 2020. Fitch believes the current political instability, past social unrest and competitive environment, combined with the negative effects from the coronavirus pandemic, provide limited clarity on the going-concern EBITDA. This increases uncertainty around the ongoing run-rate EBITDA post-pandemic. Thus, Fitch has taken a conservative view on valuations for the recovery analysis. For New Zealand operations, the going-concern EBITDA of USD80 million, represents an approximate 28% decline to the LTM EBITDA. The going-concern EBITDA reflects 2degrees' solid momentum with a good competitive position in New Zealand's stable three-player operating environment. Fitch believes the going-concern EBITDA also represents the level of sustainable cash flow to support required investments for network infrastructure and the expected spectrum payments to maintain its competitive position. Fitch assigned a multiple of 4.0x to NuevaTel based on a range of multiples used for similar companies using near-proxy sectors in the Latin American region. The multiple reflects the challenges with the current uncertainty and instability in the operating/political environment and the state of the company's business model, which experienced significant operational disruption and loss of market share during the past couple of years. New Zealand's multiple of 6.5x reflects the materially better overall operating fundamentals than Bolivia. This includes market position, growth prospects and the country's better ranking, in creditor friendly policies, and general enforceability. The multiples compare with the 5.5x median Technology, Media and Telecommunications emergence enterprise value/forward EBITDA multiple and the median 6.1x cross-sector multiple. Fitch uses a recovery cap based on analysis weighted by the economic value realized from Trilogy's existing markets of operation in Bolivia and New Zealand per Fitch's Country-Specific Treatment of Recovery Ratings Criteria. The criteria limit the upward notching of issue ratings from Issuer Default Ratings to reflect recovery expectations for entities based on the effect of country-specific factors. The criterion provides a cap of 'RR4' on Bolivia and 'RR2' on New Zealand based on country groupings leading to a combined weighted cap of 'RR3'. The assumptions result in a recovery rate for the senior secured notes at Trilogy within the 'RR3' range to generate a one-notch uplift to the debt rating from the IDR. Upon completion of the new notes' transaction, Fitch would lower the recovery rating on the $350 million notes to a 'RR4'/'CCC+' from a 'RR3'/'B-' to reflect the lower recovery prospects. 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. TWIN RIVER: S&P Affirms 'B+' ICR; Ratings Withdrawn --------------------------------------------------- S&P Global Ratings affirmed its 'B+' issuer credit rating on U.S. gaming operator Twin River Worldwide Holdings Inc., and removed the ratings from CreditWatch, where they were placed with negative implications on March 20, 2020. S&P also affirmed its 'BB-' rating on the company's senior secured credit facility and its 'B-' rating on the company's senior unsecured notes due 2027 (including the $125 million add-on), and removed all issue-level ratings from CreditWatch. Twin River's leverage will likely improve below 5x in 2021, despite the incremental leverage from recently announced acquisitions and its $125 million senior unsecured notes add-on. If recent revenue and margin improvement trends can be sustained, S&P believes the company's pro forma leverage incorporating announced acquisitions could improve to below its 5x downgrade threshold by the end of 2021 after spiking to very high levels this year due to the months-long closure of its casinos amid the COVID-19 pandemic. Twin River's EBITDA could continue to increase over the next several quarters assuming a modest improvement in its EBITDA margin compared to 2019 due to the cost cuts management implemented over the past few months, particularly related to its labor and marketing expenses. Additionally, the company could continue to improve margin because many of its lower-margin or loss-leading amenities, such as buffets, will likely remain closed for some time to comply with health and safety measures intended to limit the spread of the coronavirus. All of Twin River's current properties were reopened as of June 16, 2020. These properties are operating at reduced visitor and gaming capacity and with other social distancing and health and safety measures in place. Since reopening however, the company has reported strong property-level operating results???-reflecting a modest decline in revenues offset by a material improvement in EBITDA margin year over year, which is similar to reporting from other regional gaming operators. At its Biloxi, Miss., property, the company reported a 2% increase in revenues in June 2020 and adjusted EBITDA margin improved over 2,400 basis points (bps) during the month, which it opened in late May; while at its Dover Downs, Del., property, which opened June 1, despite a decrease in revenues of 31.6%, adjusted EBITDA margin increased by more than 1,100 bps. Twin River's Rhode Island properties, reopened on June 8 on an invitation-only basis. These restrictions were relaxed on June 30 and the properties were able to open to the general public with capacity limitations. Since then, Twin River has reported similar operating trends. "We believe strong initial performance at several properties after reopening is partly due to a lack of other entertainment options, including bars and restaurants, movie theaters and live sporting events, leading to regional gaming operators being able to attract a younger demographic that offsets the apprehension older customers may feel about entering a casino. Nevertheless, we expect unemployment to remain high through at least 2021, which could pressure discretionary spending at casinos," S&P said. "In our view, these factors may translate into Twin River's revenue and EBITDA (excluding the effect of recently completed and planned acquisitions) being below 2019 levels through 2021, despite improvement over the next few quarters," the rating agency said. S&P's 2021 base case assumes: -- U.S. GDP contracts by 4% in 2020 and improves by 3.9% in 2021. -- U.S. consumer spending declines 4.4% in 2020 and improves by 4.9% in 2021. -- U.S. unemployment remains elevated in 2020 and 2021 at 8.4% and 6.7%. "Excluding the impact of recently completed and planned acquisitions, we expect revenues will be 5%-15% lower in 2021 compared to 2019. We expect a modest improvement in 2021 EBITDA margin compared to 2019 because of the relatively high flow through from slot machines and our expectation that some cost reductions made during property closures may be more permanent, especially in a scenario where demand does not recover to prepandemic levels quickly," S&P said. "We assume recent and pending acquired properties will add $90 million-$100 million in pro forma EBITDA in 2021, assuming Twin River owns the properties for a full year in 2021. We assume revenues at these properties will be 5%-15% lower in 2021 compared to 2019 given our expectation for a weak economy, with elevated levels of unemployment and weak consumer discretionary spending," the rating agency said. Notwithstanding our forecast for 2021 revenue and EBITDA to be lower than in 2019, on average, S&P believes Twin River will continue to generate good levels of free operating cash flow through 2021, which the rating agency assumes it will use to fund its capital investment projects at Casino KC in Kansas City, Mo., and update its Lincoln, R.I., facility to add 40,000 square feet of additional gaming space. Although Twin River announced a new $100 million capital return program in February 2020 and the company could begin to return capital to shareholders once the covenant relief period expires in March 2021, S&P believes the company will prioritize acquisition integration, capital expenditures (capex) spending, and leverage improvement in lieu of share repurchases and dividends at least through 2021. The Jumer acquisition is leveraging. Twin River is acquiring the Jumer property at a 7.4x EBITDA multiple based on pre-COVID operating performance. The combination of the leveraging multiple and the incremental $125 million in funded debt as a result of the acquisition leave the company with little cushion compared to our 5x adjusted leverage downgrade threshold. Additionally, this acquisition largely offsets the potential deleveraging impact of Twin River's other pending acquisitions (Eldorado Shreveport, MontBleu, and Bally's Atlantic City), which were being done at a blended multiple lower than 5x based on the last 12-month performance pre-COVID. However, S&P acknowledges a potentially weaker economy including higher unemployment could result in all of these multiples being higher at the closing of the acquisitions and therefore having a more pronounced impact on leverage in 2021. Twin River continues to expand its geographic footprint, but remains susceptible to competitive pressures. Twin River's acquisition strategy continues to improve its geographic diversity, which can help mitigate some of the effects of regional economic weakness, changes in the competitive landscape, and other event risks in a single market, in an otherwise healthy macroeconomic environment. However, Twin River's gaming properties, including pending acquisitions are located in highly competitive markets (Missouri, Mississippi, New Jersey, Louisiana, Illinois, and Nevada), with a number of properties nearby and are not typically leaders in their respective markets. Notwithstanding, the company continues to reduce its concentration in Rhode Island, which contributed about 60% of 2019 revenue and EBITDA. Twin River's concentration in Rhode Island exposes it to competition from Connecticut and Massachusetts casinos, requiring elevated promotional and marketing spending to attract customers. Concentration can hurt margins in its primary market, especially when a new competitor opens. Additionally, its Rhode Island properties are subject to a more onerous tax rate than in other gaming markets, which can hurt cash flow. Pro forma for the pending acquisitions, Twin River's Rhode Island EBITDA concentration will be below 50%. Although S&P removed the ratings from CreditWatch, reducing the probability of a downgrade over the very near term, the rating agency believes downside macroeconomic risks are heightened that could materially impair the company's operating performance and recovery prospects compared to our current base case through the remainder of 2020 and into 2021. The negative outlook also reflects a high degree of uncertainty around containment of the virus and the impact of continued implementation of social distancing measures on consumer discretionary spending at casinos. The negative outlook also reflects the risk of a second wave of infections later this year, which could slow leverage improvement in 2021. "We could lower the rating if failure to contain the coronavirus in Twin River's operating markets leads to additional operating restrictions, if a weak economic environment causes Twin River to underperform our current base case, or if Twin River undertakes further leveraging acquisitions and we no longer believe that Twin River would be able to improve leverage to below 5x by year-end 2021. Leverage could also increase above 5x if Twin River adopted a more aggressive financial policy than we are incorporating with regard to capex spending or shareholder returns," S&P said. "It is unlikely that we will revise our outlook on Twin River to stable over the next few quarters given our forecast that its adjusted leverage will remain high and above our downgrade threshold into 2021. That said, we could revise our outlook to stable once we are confident that Twin River's operating performance has stabilized in a manner that supports adjusted leverage improving below 5x. We would consider raising our ratings if we believe Twin River will sustain leverage below 4x," the rating agency said. UNITED NATURAL: Moody's Upgrades CFR to B1, Outlook Stable ---------------------------------------------------------- Moody's Investors Service upgraded the Corporate Family Rating and Probability of Default Rating of United Natural Foods, Inc to B1 and B1-PD from B2 and B2-PD, respectively. Moody's also assigned a B3 rating to the company's new proposed senior unsecured notes. Concurrently, Moody's also upgraded the rating of the company's senior secured term loan to B2 from B3. The company's Speculative Grade Liquidity rating is upgraded to SGL-1 from SGL-2. The outlook is stable. "UNFI's operating performance has been better than expected as the integration of the Supervalu operations is nearing completion and the company has lowered its debt burden while improving EBITDA thereby improving credit metrics", Moody's Vice President Mickey Chadha stated. "The increase in sales volumes due to pantry loading during the coronavirus pandemic has also been a tailwind for the company and Moody's expects the demand for specialty groceries will remain high even after consumer buying patterns normalize", Chadha further stated. Upgrades: Issuer: United Natural Foods, Inc Corporate Family Rating, Upgraded to B1 from B2 Probability of Default Rating, Upgraded to B1-PD from B2-PD Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Senior Secured Bank Credit Facility, Upgraded to B2 (LGD4) from B3 (LGD5) Assignments: Issuer: United Natural Foods, Inc Senior Unsecured Regular Bond/Debenture, Assigned B3 (LGD5) Outlook Actions: Issuer: United Natural Foods, Inc Outlook, Remains Stable RATINGS RATIONALE UNFI's B1 Corporate Family Rating is supported by its very good liquidity, its formidable size in food distribution and its leadership position in the fast growing natural, organic and specialty food business. The acquisition of SUPERVALU diversified UNFI's customer base as well as its product offerings and has improved profitability and growth through leveraging fixed costs of the distribution operation and cost synergies. Although still high, the transaction reduced UNFI's sales concentration to Whole Foods from about 38% of total sales prior the acquisition to below 20% on a combined basis. The company did have some initial integration issues regarding consolidating distribution centers that negatively impacted operating performance post acquisition, however those issues have been resolved and Moody's expects further improvement in profitability and credit metrics in the next 12-18 months. At the closing of the transaction UNFI's lease adjusted leverage proforma for the divestiture of the retail operations and excluding any synergies was over 6.0x on a combined basis. Moody's expects lease adjusted leverage to be below 5.0x in the next 12 months. The company recently signed a 10-year supply contract with Key Food to serve as the primary grocery wholesaler to Key Food with expected sales to UNFI of approximately $10 billion over 10 years. The added revenue growth will also result in increased profitability. The distribution business is a low margin fixed cost business therefore topline growth is important to grow profitability. However, Moody's believes that the business environment will remain highly competitive once buying patterns normalize especially for the independent food retailers or small retail grocery chains. These customers are being squeezed by larger, better capitalized traditional supermarkets and alternative food retailers thereby pressuring their growth and profitability. The stable rating outlook reflects its expectation that UNFI's operating trends will remain positive, credit metrics will continue to improve, liquidity will remain good and financial policies including but not limited to acquisitions will be balanced. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded if the company demonstrates sustained growth in sales, and profitability and maintains good liquidity. Quantitatively, ratings could be upgraded if debt/EBITDA is sustained below 4.5 times and EBITA/interest expense is sustained above 2.25 times. Ratings could be downgraded if operating performance deteriorates. Ratings could also be downgraded if debt/EBITDA is sustained above 5.5 times or EBITA/interest is sustained below 1.75 times or if liquidity deteriorates or if acquisition activity causes deterioration in cash flow or credit metrics. UNFI is a leading distributor of natural, organic, and specialty, produce, and conventional grocery foods and non-food products, and provider of support services in the United States and Canada. The company has 55 distribution centers and over $26 billion in revenue. The principal methodology used in these ratings was Distribution & Supply Chain Services Industry published in June 2018. VIDEO RIVER: Accounting Errors Found in Financial Statements ------------------------------------------------------------ The staff of the Division of Corporation Finance of the Securities and Exchange Commission performed a periodic review of Video River Networks, Inc.'s Form 10-12G, filed on June 10, 2020 and raised a concern on the classification of the Company's Real Estate Inventory balance, which was inadvertently accounted for using "Fair market" value instead of the "historical cost" required by U.S. GAAP. After the review, the management of the Company reached a determination that, due to certain accounting errors, the following consolidated financial statements of the Company may no longer be relied upon: (i) the audited consolidated financial statements for the year ended Dec. 31, 2019, included in the Company's Form 10-K for the year ended Dec. 31, 2019; and (ii) the unaudited consolidated financial statements for the periods ended March 31, 2020, included in the Company's Forms 10-Q for the periods then ended. Management reached such conclusions following its evaluation of the SEC staff's comments and consultations with its independent auditor, for the following reasons. Based upon management's evaluation of the SEC staff's comments, the Company has concluded that the classification of the Company's Real Estate Inventory balance was done in error and must be reclassified and such reclassification will require a restatement of the Company's audited consolidated financial statements for the years ended Dec. 31, 2019, and its unaudited financial statements for the periods ended March 31, 2020. Management of the Company is evaluating the impact of the restatements of the previously issued financial statements on its assessments of the effectiveness of its internal control over financial reporting as of the applicable periods and such assessment will be included in the amendments to the foregoing filings. About Video River Headquartered in Torrance, California, Video River Networks, Inc. has two lines of real estate business: (1) promote and preserve affordable housing and economic development across urban neighborhoods in the United States; and (2) acquire hold and manage specialized assets including hemp and cannabis farms, dispensaries, CBD related commercial facilities, industrial and commercial real estate, and other real estate related services to the CBD and the legal cannabis industry. Dylan Floyd Accounting & Consulting, in Newhall, California, the Company's auditor since 2020, issued a "going concern" qualification in its report dated July 24, 2020, citing that the Company has an accumulated deficit of $19,150,865 for the year ended Dec. 31, 2019. These factors raise substantial doubt about the Company's ability to continue as a going concern. WAVE COMPUTING: Sintegra Resigns From Creditors' Committee ---------------------------------------------------------- James Snyder, acting U.S. trustee for Region 12, on Oct. 14, 2020, disclosed in court filings that Sintegra, Inc. resigned from the official committee of unsecured creditors appointed in the Chapter 11 cases of Wave Computing Inc. and its affiliates. The remaining committee members are Synopsis Inc., Avnet Inc., Ensilica India PVT Ltd., and PFIL North America Inc. About Wave Computing Wave Computing, Inc. is a Santa Clara, Calif.-based company that revolutionizes artificial intelligence (AI) with its dataflow-based solutions. For more information, visit https://wavecomp.ai Wave Computing and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Cal. Lead Case No. 20 50682) on April 27, 2020. At the time of the filing, Debtors had estimated assets of between $1 million and $10 million and liabilities of between $50 million and $100 million. Judge Elaine M. Hammond oversees the cases. The Debtors have tapped Sidley Austin, LLP as their bankruptcy counsel, Affeld Grivakes LLP as conflict counsel, Paul Weiss Rifkind Wharton & Garrison LLP as special counsel. Lawrence Perkins, chief executive officer of SierraConstellation Partners LLC, is Debtors' chief restructuring officer. The Office of the U.S. Trustee appointed a committee of unsecured creditors on May 18, 2020. The committee is represented by Hogan Lovells US, LLP. WEBER-STEPHEN PRODUCTS: S&P Assigns 'B' ICR; Outlook Stable ----------------------------------------------------------- S&P Global Ratings assigned its 'B' issuer credit rating to Weber-Stephen Products LLC. At the same time, S&P assigned its 'B' issue-level rating and '3' recovery rating to the company's senior secured first-lien credit facilities indicating its expectation for meaningful (50%-70%, rounded estimate: 65%) recovery. S&P's ratings reflect the company's scale, strong market position, and brand recognition, albeit in the narrow outdoor grilling category with exposure to input cost volatility. Weber has a leading market position and strong brand recognition in the $5 billion global outdoor grilling/barbecue industry and in the smaller grilling fuel, accessories, and consumables category. Moreover, it has grilling products across all price ranges, unlike its peers, which are much smaller and have a narrow product focus. With a diverse product portfolio backed by strong brand awareness, Weber is able to cater to a wide range of consumer essentials, resulting in greater household penetration and a higher installed base. Weber is the only competitor within the barbecue industry with extensive global presence and a distribution footprint across 75 countries, which provides entry into high-growth developing markets (in contrast a to very mature U.S. market). The company has also increased its innovation spend and filled a gap in its portfolio with a late entry into the fast-growing wood pellet grill market in the U.S. Product innovation is a key driver of long-term growth and Weber has increased its focus on new innovations. Still, Weber has a narrow product focus as a niche manufacturer of barbecue grills and related accessories, which is more discretionary and susceptible to change in consumer preferences. The company has a fair degree of customer concentration. Its top 10 customers account for about 50% of its estimated fiscal 2020 revenues and its largest customer represents close to 15% of sales globally. The loss of any of these customers could have a material impact on the company's operations and profitability. Weber is also exposed to raw material cost volatility due to its exposure to commodity inputs (mainly cold rolled steel and aluminum). Weber may also face foreign exchange (FX) volatility as related to currency translation as its products are sold in various geographies including Australian, Canadian and Western Europe. S&P's ratings also reflect the company's ownership's shareholder-friendly financial policies, and high but not excessive pro forma leverage for the transaction. Although the company's pro forma leverage for this transaction is not as high as similar transactions for sponsor-owned companies, S&P believes future M&A and/or shareholder returns are likely to continue, which will keep the company from materially deleveraging. Upon the closing of the transaction, S&P estimates Weber's pro forma fiscal 2020 debt to EBITDA to be approximately 6.0x on an adjusted basis and the rating agency forecasts it will decrease to 5.0x-5.5x by the end of fiscal 2021. S&P believes Weber will manage its leverage in the 5x range as it continues to execute on its growth strategy to maintain its leadership in the grilling category. Still, this refinancing is providing additional funds that the company could use for either acquisitions or a one-time dividend of up to $350 million within the next six months if no acquisition opportunities arise. In addition, S&P expects the company to use the majority of its free operating cash flow, which the rating agency estimates will total over $100 million annually, to expand manufacturing capacity. Therefore, S&P believes the company will likely sustain leverage at or above 5x over the next 12 months. Industry dynamics are favorable and should support longer-term earnings growth for the company, while EBITDA margins should rebound after one-time charges roll off in fiscal 2021. With more people staying at home, instances of home cooking and gatherings at home have increased. Even after the pandemic subsides, S&P expects the company to see low- to mid-single-digit growth in the long run due to favorable consumer preferences and more people moving to suburbs and low-density areas. Outdoor grilling and barbeques are also an entrenched part of American culture, which further supports the demand for Weber's products. While consumers may possibly trade down on the price point, the demand for grills is largely recession resilient. In fact, the company's revenues grew during the prior recession from 2008 to 2010. Although Weber's EBITDA margin was below historical levels in fiscal 2019 and S&P estimates margins to remain flat in fiscal 2020, the rating agency expects margins to rebound to historical levels in fiscal 2021. The decrease in margins in fiscal 2019 was mainly due to increased operating expenses, including higher freight expenses and increased steel costs due to the U.S.-China trade war, which started in earnest in September 2018. S&P does not anticipate these costs will recur in FY 2021, which should enable the company to restore its margins. The stable outlook reflects S&P's expectation for continued good operating performance resulting in leverage below 6.0x as the company continues to benefit from increased demand for outdoor grilling as more consumers spend time at home. "We could lower our ratings if the company's operating performance deteriorates and it sustains debt to EBITDA above 7x. Any ongoing unexpected coronavirus-related costs, increased commodity volatility, or increased competition could lead to lower demand or lost market share and cause leverage to increase above 7x. We could also lower our ratings if the company's financial policy becomes more aggressive, with significant debt-financed shareholder distributions or acquisitions that materially increase leverage above 7x," S&P said. "Although unlikely in the next 12 months, we could raise our ratings if the company's operating performance substantially improves and it adopts a less-aggressive financial policy, including a commitment to sustain leverage below 5x. An upgrade would also be predicated on a commitment from the controlling shareholder not to pursue debt-financed dividends or acquisitions that would lead to a meaningful deterioration of credit ratios," the rating agency said. WISCONSIN APPLE: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Wisconsin Apple LLC 3909 Ambassador Caffery Parkway Lafayette, LA 70503 Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court Western District of Louisiana Case No.: 20-50775 Judge: Hon. John W. Kolwe Debtor's Counsel: Douglas S. Draper, Esq. HELLER, DRAPER, PATRICK, HORN & MANTHEY LLC 650 Poydrass Street Suite 2500 New Orleans, LA 70130 Tel: 504-299-3300 Email: ddraper@hellerdraper.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Seenu G. Kasturi, member. 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/4FMEVIA/Wisconsin_Apple_LLC__lawbke-20-50775__0002.0.pdf?mcid=tGE4TAMA A copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/6DGBNWQ/Wisconsin_Apple_LLC__lawbke-20-50775__0001.0.pdf?mcid=tGE4TAMA YMCA OF MILWAUKEE: Closes Downtown Branch Permanently ----------------------------------------------------- Rich Kirchen of Milwaukee Business Journal reports that the YMCA of Metropolitan Milwaukee permanently closed its downtown Milwaukee branch in the Plankinton Arcade building and is negotiating for space in the adjacent structure at The Avenue as the organization transitions to smaller "boutique" locations. "We will no longer be the big box YMCA," president and CEO Carrie Wall said in an interview Wednesday with the Milwaukee Business Journal. The nonprofit is reinventing itself to focus on healthy living, youth development and social responsibility, Wall said. In another development, the North Side branch at 1350 W. North Ave. also will remain largely closed to members and the Rite-Hite branch in Brown Deer will serve as the only full-fledged fitness facility, she said. "We're looking at smaller boutique, healthy-living centers," Wall said. The organization's back-office functions already relocated from the downtown site to Rite-Hite while some headquarters employees including Wall are working from home during the Covid-19 pandemic, she said. The YMCA of Metropolitan Milwaukee has reduced its staff from about 700 a year ago to about 200 as of Wednesday, Wall said. She said the organization plans to operate with a balanced budget for the current fiscal year that started Sept. 1, 2020. The YMCA leased 50,000 square feet in the shuttered downtown site at 161 W. Wisconsin Ave., where the branch has been located since 1998. The organization has run a location in downtown Milwaukee throughout its 160-year history and that won't end with the branch closing, Wall said. The organization is negotiating with the owners of The Avenue in the former Shops of the Grand Avenue for pop-up fitness activities on the first floor near Walgreens, she said. Wall said she is discussing possibly leasing the former Rainbow Shops space east of Walgreens for a branch that would be about half the size of the one that just closed. The downtown branch temporarily closed in March due to Covid-19 and reopened from June 10 to Aug. 1, 2020 with Covid-19 protocols before closing again with the Y citing the concentration of cases in the city of Milwaukee. The North Side branch will reopen only its gym when the Milwaukee College Prep school at the site reopens, which may be this winter, Wall said. Rite-Hite has been largely open to members and its pool and locker room are scheduled to reopen in November, Wall said. The Milwaukee Y's Camp Minikani in Hubertus operated as a day camp this summer rather than its usual overnight residential camping, which hurt revenue. Wall said the goal is to resume overnight camp operations for summer 2021. The Milwaukee Y has struggled financially for years even after emerging from a July 2014 Chapter 11 bankruptcy case. A reorganization plan won approval in U.S. Bankruptcy Court in January 2015, including the sale of four suburban branches for a total of $9 million. The Milwaukee Y's leaders decided to focus on an "urban mission" with branches in the city of Milwaukee and one in Brown Deer while retaining ownership of Camp Minikani. A fundraising campaign under then-president and CEO Julie Tolan in 2015 netted $2.3 million but fell $1.5 million short of its goal. That was followed by a "venture philanthropy" campaign in 2016 that Tolan said drew commitments for more than $1 million designed to keep the organization running while working to increase revenue. Wall, a former Dane County YMCA CEO, started in Milwaukee in July 2017, said the Milwaukee Y's leadership already was discussing the changes announced this week but that the pandemic caused the "re-engineering" to happen faster. "We're focusing on the city of Milwaukee and serving the entire community," she said. YOGAWORKS INC: Case Summary & 20 Largest Unsecured Creditors ------------------------------------------------------------ Two affiliates that concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- YogaWorks, Inc., a Delaware C-Corporation 20-12599 2215 Main Street Santa Monica, CA 90405 Yoga Works, Inc., a California C-Corporation 20-12600 2215 Main Street Santa Monica, CA 90405 Business Description: The Debtors are providers of yoga classes with yoga studios in Atlanta, Baltimore, Boston, Houston, Los Angeles, Orange County, San Francisco Bay area, and Washington D.C. For more information, visit https://www.yogaworks.com/ Chapter 11 Petition Date: October 14, 2020 Court: United States Bankruptcy Court District of Delaware Debtors' Delaware Restructuring Counsel: Thomas J. Francella, Jr., Esq. COZEN O'CONNOR 1201 North Market Street, Suite 1001 Wilmington, DE 19801 Tel: 302-295-2000 302-295-2023 Fax: 302-250-4495 Email: TFrancella@cozen.com Debtors' Restructuring Counsel: Alan J. Friedman, Esq. Melissa Davis Lowe, Esq. SHULMAN BASTIAN FRIEDMAN & BUI LLP 100 Spectrum Center Drive, Suite 600 Irvine, CA 92618 Tel: (949) 427-1654 Fax: (949) 340-3000 E-mail: afriedman@shulmanbastian.com mlowe@shulmanbastian.com Debtors' Financial Advisors: FORCE TEN PARTNERS, LLC Chad Kurz Office: (917) 514-6500 Email: ckurtz@force10partners.com Debtors' Claims, Noticing, & Solicitation Agent and Administrative Advisor: BMC GROUP, INC. https://www.bmcgroup.com/restructuring/geninfo.aspx?ClientID=466 Each Debtor's Estimated Assets: $1 million to $10 million Each Debtor's Estimated Liabilities: $10 million to $50 million The petitions were signed by Brian Cooper, chief executive officer. Copies the petitions containing, among other items, lists of the Debtors' 30 largest unsecured creditors are available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/D4GDE6I/Yoga_Works_Inc_a_California_C-Corporation__debke-20-12600__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/HKMYQGQ/YogaWorks_Inc_a_Delaware_C-Corporation__debke-20-12599__0001.0.pdf?mcid=tGE4TAMA YOGAWORKS INC: Files for Chapter 11 to Sell to Serene ----------------------------------------------------- YogaWorks, one of the leading providers of authentic yoga instruction in the United States, announced Oct. 14, 2020, that it has voluntarily filed petitions under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the "Court"). As part of this process, YogaWorks has entered into a purchase agreement ("Agreement") with Serene Investment Management ("Serene"), pursuant to which Serene will serve as the stalking-horse bidder and has agreed to acquire the YogaWorks digital and education business and intellectual property. YogaWorks expects to conduct an auction pursuant to Section 363 of the U.S. Bankruptcy Code, in which the Serene purchase agreement sets the floor for the auction, a process designed to achieve the best offer, subject to approval by the Court. Under the direction of its existing management team, YogaWorks' operations will continue via its live stream and on-demand digital platforms, YogaWorks Live and MyYogaWorks, as well as its teacher training and workshop departments, with all of its in-person studio locations around the country closing due to the ongoing effects of the COVID-19 pandemic. The Company does not expect there to be any significant changes to employees??? day-to-day job responsibilities, and expects that current employees will continue to be paid and receive benefits in the ordinary course of business. "The COVID-19 pandemic has created unprecedented challenges for our industry and business, including mandatory studio closures and social distancing-imposed attendance restrictions even where studios have been permitted to reopen," said Brian Cooper, Chief Executive Officer of YogaWorks. "We have been taking action to adapt to these challenges, including expanding our digital platform that now offers YogaWorks students over 40 live streaming yoga classes per day and over 1,000 hours of pre-recorded classes and yoga workshops - all from the best teachers in the business. We have also successfully transformed our world renown teachers training and certification offering for our students and teachers to a virtual environment creating new and exciting revenue opportunities for the Company. After considering a number of alternatives to overcome the financial challenge of the studio closures, we determined that implementing an orderly restructuring process is in the best interest of all of our key stakeholders, most notably our dedicated teachers and passionate students. With the improved financial flexibility provided through this process, we will continue to build upon the strengths of our digital and educational platforms, both of which have proven to be successful and have experienced significant growth over the course of the past several months. We look forward to continuing to serve our loyal students and positioning YogaWorks for long-term success." In connection with the Chapter 11 filing, Serene has also provided a commitment for debtor-in-possession ("DIP") financing, which will provide the liquidity to support YogaWorks through the pendency of the reorganization. YogaWorks' digital business has been profitable since it was established, with strong fundamental growth, and a unique and compelling foundation for the growth of the company, brand, and many of the world???s top yoga instructors. Mr. Cooper added, "I would like to extend my sincere appreciation to our employees and teachers for their tireless commitment to YogaWorks over the past several months, years, and in many cases decades. We are so impressed by the passion and love that our teams have displayed despite the many challenges faced. We have also been humbled by the support and dedication that we continually receive from our students as we've fought through these uncharted challenges together, displaying the amazing impact that YogaWorks has had in the communities we serve. We will continue to make decisions that provide the most benefit to our team, students, and partners, and we are confident that we will emerge from this process a stronger organization." About YogaWorks YogaWorks is a leading provider of progressive and quality yoga that promotes total physical and emotional well-being. YogaWorks caters to students of all levels and ages with both traditional and innovative programming. It is also an international teaching school, cultivating the richest yoga talent from around the globe and setting the gold standard for teaching. For more information on YogaWorks, visit yogaworks.com. YogaWorks, Inc., and Yoga Works, Inc., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-12599) on Oct. 14, 2020. In the petition signed by CEO Brian Cooper, YogaWorks was estimated to have $1 million to $10 million in assets and $10 million to $50 million in liabilities. The Debtors tapped SHULMAN BASTIAN FRIEDMAN & BUI LLP as restructuring counsel; COZEN O'CONNOR as Delaware restructuring counsel; and FORCE TEN PARTNERS, LLC as financial advisor. BMC GROUP, INC., is the claims agent. [*] Eagle Ford Shale's Biggest Bankruptcy Filings in 2020 --------------------------------------------------------- Jessica Corso of San Antonio Business Journal reports that the Eagle Ford Shale has been the site of a handful of billion-dollar bankruptcies this year. Between oil and gas production companies and oil field services firms, there have been at least 72 bankruptcies filed since an industry downturn caused, in part, by the Covid-19 pandemic began in March, according to law firm Haynes and Boone LLP. While not all of those companies operate in South Texas' biggest oil field, the ones that do collectively reported tens of billions of dollars in debt. Using Haynes and Boones calculations, the Business Journal assembled a list of some of the largest bankruptcies to hit the Eagle Ford since the downturn began. * Chesapeake Energy Corp. Debt: $11.8 billion Oklahoma-based Chesapeake was the second-most active driller in the Eagle Ford Shale last year by number of permits filed. Soon after it filed for Chapter 11 protection in June, the Business Journal dug into the possible ramifications of its bankruptcy for South Texas, and that was before mineral rights owners in the Eagle Ford sued for $160 million. * Hi-Crush Inc. Debt: $3.8 billion Hi-Crush is a frac sand miner that sells its sand to drillers throughout North America, including in the Eagle Ford. The company emerged from Chapter 11 bankruptcy protection on Oct.9, saying it had shed $450 million in debt from its balance sheet. * Gavilan Resources LLC Debt: $1.2 billion Funded by private equity behemoth Blackstone Group, Gavilan was founded in 2017 following the $2.3 billion purchase, in partnership with Sanchez Energy, of Eagle Ford assets from Anadarko Petroleum. Sanchez, having recently emerged from bankruptcy itself, bought Gavilan's assets at auction this month for $50 million. * Calfrac Well Services Ltd. Debt: $745 million Canadian oil field services provider Calfrac entered the Eagle Ford Shale in 2013 with the purchase of Mission Well Services. The company has an office in San Antonio and provides hydraulic fracturing services to companies operating in South Texas. * FTS International Inc. Debt: $705 million With an office in Pleasanton, FTS provides provides pressure pumping services to production companies in the Eagle Ford Shale. It's the most recent company to declare bankruptcy on this list, having filed for Chapter 11 protection on Sept. 22. * BJ Services LLC Debt: $506 million Houston-based BJ Services warned the Texas Workforce Commission in July that it could close its San Antonio office, laying off all 200 workers, if it can't work out a deal in bankruptcy. BJ Services is in the oil field services industry, fracking and cementing wells in fields throughout the U.S. and in Canada. * Pioneer Energy Services Corp. Debt: $489 million Pioneer wasn't the largest oil field services company to file for bankruptcy this year, but it was the largest one based in San Antonio. While the company filed a few days before oil futures began plummeting, its path out of bankruptcy was certainly altered by the downturn. Four months after exiting bankruptcy, the company continues to struggle to meet even the modest goals it laid out for debtors. * Freedom Oil & Gas Inc. Debt: $50 million Again, there were larger companies than Freedom Oil to file for bankruptcy this year. But the company is one of only three Eagle Ford producers, along with Chesapeake and Gavilan, to do so since the downturn. The company operates in the shale play as Freedom Production Inc., where it has submitted applications for 22 permits to drill wells in Dimmit County since 2017. [*] Notable Bankruptcy Filings in Bay Area Since the Pandemic ------------------------------------------------------------- Brian Rinker of the San Francisco Business Times reports that many Bay Area businesses have closed their doors for good, sought bankruptcy protection or quietly slipped away into insolvency since the region went under lock-down orders in mid-March to curtail community spread of the coronavirus. Since then, some notable local companies have sought bankruptcy protection as a way to stay in business or as a way to liquidate assets and close forever. Nationwide, retail chains like Men's Wearhouse, J.C. Penny, Neiman Marcus, J. Crew and Ascena Retail -- owner of Ann Taylor and Lane Bryant -- have sought bankruptcy protection as in-person shopping has shrunken dramatically in the wake of Covid-19. The Bay Area has had some notable Covid-related bankruptcies, from the gym chain 24 Hour Fitness to the cookie and sandwich chain Specialty's Caf?? and Bakery to aerial imagery startup Terravion. But there have also been many filings since March from companies whose long-running financial problems or internal scandals are the real reasons behind the business landing in bankruptcy court. Flip through the slideshow above to see 10 of the most notable bankruptcies since the pandemic. In addition to this, many small businesses and local favorites that are not on the notable bankruptcies list have nonetheless closed for good. For a rundown on Bay Area restaurants that have shuttered, see the following slideshow: 1.) 24 Hour Fitness: The San Ramon-based fitness gym chain filed for Chapter 11 bankruptcy in June 2020 and at the time said that because of Covid-19 it was permanently shuttering about 130 clubs, including 13 in the Bay Area. "If it were not for Covid-19 and its devastating effects, we would not be filing for Chapter 11," said Tony Ueber, the gym's CEO. 2.) Crosscode: Information technology startup Crosscode filed for bankruptcy last September 2020, but it wasn???t coronavirus that felled the pre-revenue Foster City company. It was a good old-fashioned clash between the founder and the board of directors and investors. Crosscode sought Chapter 11 bankruptcy protection after mounting legal expenses over the fallout of firing founder and former CEO Aditya Sharma and his attempt to reclaim his role drained the startup's coffers and made it unable to pay its debt. 3.) DOSA: The San Francisco upscale Indian restaurant DOSA has permanently closed its swanky Fillmore Street location and filed for Chapter 8 bankruptcy liquidation. DOSA had money problems before the pandemic, closing a location on Valencia Street and filing for Chapter 11 in 2019, but the owners held out hopes they could get their debt under control. But those hopes were dashed due to Covid-19. The owners will transition to a ghost kitchen model. They also still have a fast casual restaurant in Oakland. 4.) 11965 San Pablo LLC: The owner of the 142-unit Polaris Apartments development at 11965 San Pablo Ave. in El Cerrito, dubbed the Polaris Apartments, filed for Chapter 11 bankruptcy in September 2020. The plan was to build an eight-story apartment building to replace an old Taco Bell in North El Cerrito. The LLC owes between $1 million and $10 million to fewer than 50 creditors. 5.) Galileo Learning: The Oakland-based summer camp for kids filed for Chapter 11 bankruptcy in May 2020 after being forced to close 70 summer camps across three states in response to the coronavirus pandemic. The 18-year old company had taken in nearly $12 million in tuition for camps this summer from more than 10,000 families, according to bankruptcy documents. Galileo proposed to the bankruptcy court two options for how families can recoup their tuition. Under the proposal, families could accept either a 110% credit toward the online camps the company expects to roll out in the next couple of weeks, or a 50% discount toward any program within the next five years. 6.) Professional Financial Investors: The Novato real estate investment company sought Chapter 11 bankruptcy protection in July 2020 after coming under federal investigation for an alleged Ponzi scheme. The alleged wrongdoing was three decades in the works and only came to light after the death of its owner, Ken Casey. It's estimated that there are 1,000 victims and hundreds of million of dollars that went into Casey's pocket before he died, according to court documents. The Marin Independent Journal reported that the company owes $250 million to investors and has roughly $400 million in debt. 7.) Proteus Digital Health: The biotech company, known for its efforts to create smart pills to track patients, filed Chapter 11 bankruptcy in June 2020. Two months later, the company, which is headquartered in Redwood City and has a production facility in Hayward, was sold out of bankruptcy court to Otsuka Pharmaceuticals Inc. for $15 million. The company's hard times began well before Covid-19 as it burned through money trying to create a pill with a microchip on it. In December 2019, the 18-year-old company laid off or furloughed nearly 300 employees. 8.) RealtyShares: The San Francisco crowdfunding real estate investment startup filed a petition on July 31, 2020 for Chapter 7 liquidation bankruptcy. It was a once-promising startup that had risen to stardom only to fizzle out after running out of money. The problems with the company came to a head in 2018, way before the coronavirus descended on the world. "RealtyShares was one of the first real estate crowdfunding platforms in the world. It was a big deal with a pretty powerful brand. And for a while it was riding high doing well," said Jeff Holzmann, CEO of IIRR Management Services, which took over management of RealtyShares investment portfolio. "But at the end of the day, it was a failed business that had run out of money." 9.) Specialty's Caf?? and Bakery: The Pleasonton-based bakery, known for big, hot, fresh cookies, filed for Chapter 7 bankruptcy liquidation in May 2020, closing down all 55 locations for good after 33 years in business. The company posted the followings statement on its website that "current market conditions attributed to Covid-19 and shelter-in place policies have decimated company revenues." At the end, the company's total assets totalled between zero and $50,000 and it owed nearly 1,000 creditors somewhere between $1 million and $10 million. 10.) TerrAvion: Arial imagery startup TerrAvion, which once attracted prominent Bay Area venture firms like Initalized Capital and Merus Capital, filed for Chapter 11 bankruptcy protection in September 2020. Days later, Ag Web reported CEO Robert Morris sent customers an email saying the company was closed and that clients should download any data they had immediately. The exact reason why the startup is seeking bankruptcy protection is unclear, but the likely culprit was the economic challenges brought about by Covid-19. ********* 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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