/raid1/www/Hosts/bankrupt/TCR_Public/210111.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, January 11, 2021, Vol. 25, No. 10
Headlines
232 SEIGEL: Asks Court to Extend Plan Exclusivity Until May 10
ABILITY INC: Annual Meeting Set for Feb. 9
ADVANCED POWER: Seeks February 5 Plan Exclusivity Extension
ALPINE 4: Creates New Series D Convertible Preferred Stock
AMERICAN LIMOUSINE: Case Summary & 20 Largest Unsecured Creditors
ASTROTECH CORP: Mark Adams Quits as Director
ATVT LLC: Seeks to Hire Apel Associates as Accountant
BEST VIDEO: Unsecured Creditors to Recover 100% in 5 Years
BOSTON SCIENTIFIC: Egan-Jones Cuts Senior Unsec. Ratings to BB+
CAESARS ENTERTAINMENT: Egan-Jones Cuts Sr. Unsec. Ratings to CCC
CENTRAL PROCESSING: Complaint for Payment of IRS Taxes Dismissed
CHURCHILL DOWNS: Moody's Affirms Ba3 CFR, Alters Outlook to Stable
CLEARPOINT CHEMICALS: Feb. 23 Disclosure Hearing Set
COMMUNITY INTERVENTION: FBTS Buying All Assets of Futures for $7.5M
COMMUNITY INTERVENTION: SBTS Buying South Bays Assets for $32M
COMSTOCK MINING: Key Employees to Get 1.26M Performance Share Units
CRACKED EGG: Can't Use Chapter 11 to Stop County's Shutdown Attempt
CREATIVE REALITIES: Amends Loan Agreement to Extend Conversion Date
CRESTWOOD EQUITY: S&P Rates New Notes 'BB-'
CRESTWOOD MIDSTREAM: Moody's Rates New $700MM Unsec. Notes 'B1'
CWGS ENTERPRISES: Moody's Upgrades CFR to B1, Outlook Stable
DIOCESE OF BUFFALO: Seeks to Hire Jones Day as Special Counsel
EAST VILLAGE: Unsec. Creditors to Recover 25% in Liquidating Plan
FECK PROPERTIES: Court Confirms Sale Plan
FERRELLGAS PARTNERS: Removes Interim Tag from CEO Ferrell's Title
FIRST FLORIDA: Wants Solicitation Exclusivity Extended Thru March 1
FORUM ENERGY: Divests ABZ, Quadrant Valve Brands
FRANCESCA'S HOLDINGS: TerraMar Named Stalking Horse Bidder
GALAXY NEXT: Tysadco to Buy Up to $10M Worth of Common Stock
GARRETT MOTION: Equity Holders Should Shoulder Fees, Creditors Say
GASTON ENTERPRISES: Gets OK to Hire RP Valuation as Appraiser
GATEWAY RADIOLOGY: 11th Cir. Rules Debtors Can't Receive PPP Loans
GENESIS PLACE: Jan. 19 Hearing on Disclosure Statement
GENESIS PLACE: Unsecureds Get Monthly Payments Until Paid in Full
GI DYNAMICS: Inks Third Amendment to Preferred Stock Purchase Deal
GIRARDI KEESE: 2 Lawyers Accused of Covering Up Settlement Theft
GLOBAL HEALTHCARE: Appoints Clifford Neuman as Secretary
GRATITUDE TRAINING: Case Summary & 20 Largest Unsecured Creditors
GROWLIFE INC: Inks Third Amendment to Labrys Promissory Note
GULFPORT ENERGY: Taps Kirkland & Ellis as Bankruptcy Counsel
HURDL INC: Prepackaged Plan of Reorganization Confirmed by Judge
IMERYS TALC: Certain Insurers Say Confirmation Schedule Unrealistic
IMERYS TALC: Insurers Question Cyprus Deal, Object to Disclosures
INTERSTATE COMMODITIES: Architect Outbid Rivals to Buy Property
INVESTVIEW INC: Unit Reports $1.88M Monthly Bitcoin Mining Revenue
IONIX TECHNOLOGY: Signs $253,500 Funding Agreements with Labrys
JCV GROUP: Judge Rejects Plan & Disclosures
JDUB'S BREWING: $400K Sale of Mango Property to Fund Plan
K & L TRAILER: JPM Financial Buying Trailers for $5,000 Cash
KHAN REAL ESTATE: Feb. 2 Plan Confirmation Hearing Set
KOPIN CORPORATION: CEO Gets $600K Annual Salary Under Amended Deal
LAMAR ADVERTISING: S&P Alters Outlook to Stable, Affirms 'BB-' ICR
LE TOTE: Reaches HBC Deal; Unsecureds to Recover 8%
LE TOTE: Wilmington Trust to Raise Objections at Confirmation
LIDDLE & ROBINSON: Unsecureds to Recover Up to 2% in Trustee Plan
MARRONE BIO: Van Herk Exercises 33.3% of Outstanding Warrants
MDC HOLDINGS: Moody's Rates New $300MM Notes Due 2031 'Ba1'
MDC HOLDINGS: S&P Rates New $300MM Senior Unsecured Notes 'BB+'
MEDASSETS SOFTWARE: Fitch Assigns First-Time 'B' LongTerm IDR
MEXTEX OPERATING: Court OKs Changes to Disclosure Statement
MEXTEX OPERATING: Rocking Says Plan Disclosures Misleading
MOUNTAINEER GAS: Fitch Puts BB+ LongTerm IDR on Rating Watch Pos.
NEWELL MOWING: Seeks to Hire Berken Cloyes as Bankruptcy Counsel
NICE SERVICES: Payouts to Secured Claims Amended; Plan Confirmed
NINEPOINT MEDICAL: Tall Marmot-Backed Plan Confirmed by Judge
NORTH TAMPA: Unsecureds Will Receive 1% of Their Claims
NPC INTERNATIONAL: Reaches Deals With Flynn, Wendy's on $800M Sale
OAKSHIRE MUSHROOM: Has Deal on Avondale Sale, Unsecureds Get $87K
ORTHO-CLINICAL DIAGNOSTICS: S&P Places 'B-' ICR on Watch Positive
PBS BRAND: U.S. Trustee Appoints Creditors' Committee
PEAK SERUM: Trustee Taps Sender & Smiley, Cohen as Legal Counsel
PETERSEN-DEAN INC: SPI's SolarJuice Acquires Consumer Contracts
PG&E CORP: Victims Trustee Urges Court to Toss Plan Appeal
PINKLEY FARMS: $350K Sale of Springdale Property to Geels Approved
PLAINS END: Fitch Affirms B+ Rating on Subordinated Secured Bonds
PT RAHAJASA: Asks NY Court to Enforce $14.5M Award vs. Indonesia
R & R TRUCKING: To Seek Approval of 25% Plan on Feb. 23
REALOGY GROUP: Moody's Rates New $600MM Sr. Unsec. Notes 'Caa1'
REALOGY GROUP: S&P Rates New $400MM Senior Unsecured Notes 'B-'
RHA STROUD: Chapter 11 Cases Dismissed
RONNA'S RUFF: S&T Objects to 5-Year Reamortization of Vehicle Loans
RUBIO'S RESTAURANTS: Emerges From Chapter 11 Bankruptcy
RUTABAGA CAFE: Feb. 24 Plan Confirmation Hearing Set
RUTABAGA CAFE: Unsecured Creditors to Get 2% Dividend in Plan
SANUWAVE HEALTH: Stockholders OK 2 Proposals at Special Meeting
SENTINL INC: Court Confirms Plan After Parties Reach Deal
SK HOLDCO: S&P Raises ICR to 'CCC+' on Close of Refinancing
SMARTOURS LLC: Unsec. Creditors to Recover 100% in Confirmed Plan
SMP ENTERPRISES: Has Until March 2 to File Plan & Disclosures
STUDIO MOVIE: Files Plan After Shutting 15 of 33 Dine-In Theaters
TENTLOGIX INC: Seeks to Hire Carr Riggs as Accountant
TIRED TEXAN: Seeks Approval to Hire Verdant as Accountant
TMS INTERNATIONAL: S&P Assigns 'BB-' Rating to $150MM Term Loan B
TPT GLOBAL: Subsidiary Inks First SaaS Deal with MDamerica
TRATTORIA SAN DOMENICO: Restaurant Closes, Files for Chapter 7
TWO WHEELS PROPERTIES: Court To Dismiss Ch. 11 Case
TWO WHEELS PROPERTIES: Gets OK to Hire Accountant
UTZ QUALITY: S&P Rates $720MM Term Loan 'B'
VALARIS PLC: Denounces Lenders Efforts to Submit Rival Plan
VIDEOMINING CORP: Seeks to Hire ICAP as Patent Broker
WESTINGHOUSE ELECTRIC: Court Rejects Workers' WARN Suit vs. SCANA
WOODBRIDGE GROUP: Trust Announces $50M Distribution
YODEL TECHNOLOGIES: Judge Enters Plan Confirmation Order
ZUAITER COMPANY: Seeks Approval to Hire Bankruptcy Attorney
[*] 15 Businesses That Shut in Columbus, Ohio in 2020
[*] More Than 50 Restaurant & Retail Bankruptcies in 2020
[*] Navigating Chapter 11 Reorganizations During COVID-19
[^] BOND PRICING: For the Week from January 4 to 8, 2021
*********
232 SEIGEL: Asks Court to Extend Plan Exclusivity Until May 10
--------------------------------------------------------------
232 Seigel Development LLC and 232 Seigel Acquisition LLC, request
the U.S. Bankruptcy Court for the Southern District of New York to
extend the exclusive periods during which the Debtors may file a
Chapter 11 plan and solicit acceptances for the plan to May 10,
2021.
According to the Debtors, cause exists to extend the Exclusive
Periods for an additional 120 days. The Debtors state that most of
the Adelphia factors--(a) the size and complexity of the case; (b)
the necessity of sufficient time to negotiate and prepare adequate
information; (c) the existence of good-faith progress toward
reorganization; (d) whether the debtor is paying its debts as they
come due; (e) whether the debtor has demonstrated reasonable
prospects for filing a viable plan; (f) whether the debtor has made
progress in negotiating with creditors; (g) the time the case has
been pending;(h)whether the debtor is seeking the extension to
pressure creditors; and (i)whether unresolved contingencies
exist--support the Debtors' request for an extension of
exclusivity.
The Debtors suggest that under the circumstances, the Debtors are
making "good faith progress toward reorganization" since the
Debtors are on track to commencing marketing and confirm a plan
that is likely to pay all creditors in full. The third element
supports an extension.
The Debtors have few obligations post-petition and therefore submit
that the fourth element of generally paying bills as they come due
does not apply.
On the Debtors' reasonable prospects for reorganization, again the
Debtors are working cooperatively with all parties, have filed a
liquidating plan, and submit they have excellent prospects for
reorganization.
On the sixth factor, i.e. progress in negotiations with its
creditors, the progress has been made in obtaining cooperation of
the parties on a liquidating plan.
A copy of the Debtor's Motion to extend is available from
PacerMonitor.com at https://bit.ly/39cuit5 at no extra charge.
About 232 Seigel Acquisition
232 Seigel Acquisition classifies its business as Single Asset Real
Estate (as defined in 11 U.S.C. Section 101(51B)). 232 Seigel
Acquisition is the owner of a fee simple title to certain real
property in Brooklyn, New York, having a comparable sale value of
$18 million.
232 Seigel Development LLC and 232 Seigel Acquisition LLC sought
Chapter 11 protection (Bankr. S.D.N.Y. Case No. 20-22844 to
20-22845) on July 14, 2020. 232 Seigel Acquisition disclosed total
assets of $18,000,000 and total liabilities of $7,112,316.
The Honorable Robert D. Drain is the case judge. The Debtors
tapped Mark Frankel, Esq., at BACKENROTH FRANKEL & KRINSKY, LLP, as
counsel.
ABILITY INC: Annual Meeting Set for Feb. 9
------------------------------------------
Ability Inc. has invited its shareholders to attend the Annual and
Special General Meeting of the Company to be held at its offices
located at Yad Harutzim 14, Tel Aviv, Israel, 6770007, on Tuesday,
Feb. 9, 2021 at 11:00 a.m. (Israel time).
The purpose of the meeting is to consider and vote upon:
1. Discussion of the Company's financial statements for the
year
ended Dec. 31, 2019;
2. Re-election of each of Mr. Anatoly Hurgin and Mr. Alexander
Aurovsky to serve as members of the Company's Board of
Directors until its next annual general meeting and in
accordance with our amended and restated memorandum and
articles of association;
3. Ratification of the appointment of the independent public
accountants, Ziv Haft, Certified Public Accountants (Isr.), a
BDO Member Firm, for the financial year ending in 2020;
4. Election of Mr. Amir Ariel to serve as an external director
of
the Company for a period of three years commencing
Feb. 9, 2021 and in accordance with the Company's amended
and
restated memorandum and articles of association;
5. Approval of the Terms of Service and Employment of Mr. Amir
Ariel as an External Director of the Company; and
6. Approval of the appointment of the CEO of the Company, Mr.
Anatoly Hurgin, as Chairman of the Board, pursuant to
section
121(c) of the Israeli Companies Law (5759-1999), for a period
of 3 years, commencing on the date of the Meeting.
About Ability Inc.
Ability Inc. is a holding company operating through its
subsidiaries Ability Computer & Software Industries Ltd., Ability
Security Systems Ltd., and Telcostar, which provide advanced
interception, geolocation and cyber intelligence products and
solutions that serve the needs and increasing challenges of
security and intelligence agencies, military forces, law
enforcement agencies and homeland security agencies worldwide.
Ability Inc. reported a net and comprehensive loss of US$7.74
million for the year ended Dec. 31, 2019, compared to a net loss
and comprehensive loss of US$10.19 million for the year ended Dec.
31, 2018. As of June 30, 2020, the Company had US$14.14 million in
total assets, US$21.34 million in total liabilities, and a total
shareholders' deficit of US$7.20 million.
Ziv Haft, Certified Public Accountants (Isr.) BDO Member Firm, in
Tel Aviv, Israel, the Company's auditor since 2015, issued a "going
concern" qualification in its report dated June 15, 2020 citing
that the Company has an accumulated deficit, working capital
deficit, suffered recurring losses and has negative operating cash
flow. Additionally, the Company is under an investigation of the
Israeli Ministry of Defense, which ordered a suspension of certain
export licenses. Additionally, severe restrictions imposed by many
countries on global travel as a result of the coronavirus disease
of 2019 outbreak have impeded the Group's ability to complete the
phase of the systems acceptances. These matters, along with other
reasons, raise substantial doubt about the Company's ability to
continue as a going concern.
ADVANCED POWER: Seeks February 5 Plan Exclusivity Extension
-----------------------------------------------------------
Advanced Power Technologies, LLC, requests the U.S. Bankruptcy
Court for the Southern District of Florida, Fort Lauderdale
Division, to extend by 60 days the exclusive period during which
the Debtor may file a plan of reorganization through and including
February 5, 2021, and to solicit acceptances through and including
April 5, 2021.
The Debtor has only been in bankruptcy since March 11, 2020, and is
generally paying its post-petition debts as they come due. The
Debtor continues to negotiate with its largest general unsecured
creditor regarding payment of its claim and continues to negotiate
the terms of exit financing with its primary secured creditor.
These negotiations will dictate the substance of what the Debtor
believes will be a consensual chapter 11 plan.
This is the Debtor's third request to extend the Exclusivity
Periods and the Debtor is not seeking the extensions as a delay
tactic or to pressure creditors.
A copy of the Debtor's Motion to extend is available from
PacerMonitor.com at https://bit.ly/35gvtGQ at no extra charge.
About Advanced Power Technologies
Advanced Power Technologies, LLC --
http://www.advancedpowertech.com/-- offers interior and exterior
lighting, signage, and electrical service needs throughout the
United States and Canada. It works with commercial, hospitality,
industrial, institutional, restaurant, and retail clients to save
energy and reduce operating costs.
Advanced Power Technologies, LLC, based in Pompano Beach, Fla.,
filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 20-13304) on
March 11, 2020. In the petition signed by Devin Grandis,
president, the Debtor was estimated to have $1 million to $10
million in both assets and liabilities.
Judge Peter D. Russin Bradley replaced Judge Paul G Hyman Jr., who
previously oversees the case. Bradley S. Shraiberg, Esq., at
Shraiberg Landau & Page PA, serves as Debtor's bankruptcy counsel.
The U.S. Trustee was not able to appoint an Official Committee of
Unsecured Creditors for the Debtor.
ALPINE 4: Creates New Series D Convertible Preferred Stock
----------------------------------------------------------
The Board of Directors of Alpine 4 Technologies Ltd. approved the
filing with the Secretary of State of Delaware a Certificate of
Designation of Rights and Preferences for the creation of a new
Series D Convertible Preferred Stock.
On Dec. 28, 2020, the Company filed the Designation with the
Secretary of State of Delaware, which served to amend the Company's
Certificate of Incorporation to include the Designation. Pursuant
to the Company's Certificate of Incorporation, the Company's Board
of Directors is authorized to provide by resolution for the
issuance of shares of preferred stock, and to establish the
designation, powers, preferences, and rights of the shares of such
series of preferred stock.
The terms of the Series D Preferred Stock include the following:
- Number of shares: The Company designated 1,628,572 shares
of
Series D Preferred Stock.
- The Stated Value of the Series D Preferred Stock is $3.50
per
share.
- No dividends will accrue on the Series D Preferred Stock.
If
dividends are declared on the Company's Class A, Class B,
or
Class C Common Stock, the holders of the Series D Preferred
Stock will participate in such dividends on a per share
basis, pari passu with the Classes of Common Stock.
- Voting Rights
* The Series D Preferred Stock will vote together with
the
Class A Common Stock on a one-vote-for-one-Preferred-
share basis.
* As long as any shares of Series D Preferred Stock are
outstanding, the Company may not, without the
affirmative
vote or written consent of the holders of a majority of
the then outstanding shares of the Series D Preferred
Stock, (a) alter or change the powers, preferences or
rights given to the Series D Preferred Stock or alter or
amend the Certificate of Designation, (b) amend its
Certificate of Incorporation or other charter documents
in any manner that adversely affects any rights of the
holders of the Series D Preferred Stock, or (c) enter
into any agreement or arrangement with respect to any of
the foregoing.
- Liquidation
* Upon any liquidation, dissolution or winding-up of the
Company, whether voluntary or involuntary (a
"Liquidation"), the holders of the Series D Preferred
Stock shall participate on a per share basis with the
holders of the Class A, Class B, and Class C Common
Stock of the Company, and shall be entitled to share
equally, on a per share basis, all assets of the
Company
of whatever kind available for distribution to the
holders of all classes of the Common Stock. The
Company
shall mail written notice of any such Liquidation, not
less than 45 days prior to the payment date stated
therein, to each record holder of Series D Preferred
Stock.
- Conversion: The Series D Preferred Stock shall be convertible
automatically into shares of the Company's Class A Common
Stock as follows:
* Each share of Series D Preferred Stock will automatically
convert into shares of the Company's Class A Common
Stock
on the earlier to occur of (a) the fifth day after the
twenty-four month anniversary of the original issue date
or (b) the fifth day after the date on which the
Company's
Class A Common Stock first trades on a national
securities
exchange (including but not limited to NASDAQ, NYSE, or
NYSE American but excluding OTCQX Market).
* The number of shares of the Company's Class A Common
Stock
into which the Series D Preferred Stock shall be
converted
shall be determined by multiplying the number of shares
of
Series D Preferred Stock to be converted by the $3.50
stated value, and then dividing that product by the
Conversion Price. The Conversion Price shall be equal
to
the Variable Weighted Average Price ("VWAP") of the five
Trading Days prior to the Automatic Conversion Date.
"VWAP" shall be defined as the volume weighted average
price of the Company's Class A Common Stock on the OTC
Markets or other stock exchange or trading medium where
such shares are traded as reported by Bloomberg, L.P.
using the VWAP function. If for any reason, VWAP cannot
be thus determined, "VWAP" shall mean the average closing
or last sale prices over the five Trading Days prior to
the Automatic Conversion Date of the Company's Class A
Common Stock on the OTC Markets or such other exchange or
trading medium.
- Restrictions on Resales of Class A Common Stock
* The sale of shares of the Company's Class A Common Stock
issued at the time of conversion by any holder into the
market or to any private purchaser shall be limited to
not
more than 25% of all conversion shares received by such
holder at the time of the automatic conversion in any
given 90-day period.
- Company Redemption Rights
- At any time on or prior to the Automatic Conversion Date,
the Company shall have the right to redeem all (but not
less than all) shares of the Series D Preferred Stock
issued and outstanding at any time after the original
issue date, upon three business days' notice, at a
redemption price per share of Series D Preferred Stock
then issued and outstanding, equal to the stated value of
$3.50 per share.
- Registration Rights
* The shares issued on conversion of the Series D
Preferred
Stock have piggyback registration rights beginning on
that date which his six months after the date on which
the Company's Class A Common Stock trades on a national
securities exchange, and are subject to standard
underwriter holdback limitations.
About Alpine
Alpine 4 Technologies Ltd. is a publicly traded enterprise with
business related endeavors in software, automotive technologies,
electronics manufacturing, and energy services & fabrication
technologies. As of June 1, 2020, the Company was a holding
company that owned seven operating subsidiaries: ALTIA, LLC;
Quality Circuit Assembly, Inc.; American Precision Fabricators,
Inc.; Morris Sheet Metal, Corp; and JTD Spiral, Inc.; Deluxe Sheet
Metal, Inc,; and Excel Fabrication, LLC.
Alpine 4 Technologies reported a net loss of $3.13 million for the
year ended Dec. 31, 2019, compared to a net loss of $7.91 million
for the year ended Dec. 31, 2018. As of Sept. 30, 2020, the
Company had $36.59 million in total assets, $50.16 million in total
liabilities, and a total stockholders' deficit of $13.57 million.
MaloneBailey, LLP, in Houston, Texas, the Company's auditor since
2015, issued a "going concern" qualification in its report dated
June 1, 2020 citing that the Company has suffered recurring losses
from operations and has a net capital deficiency that raises
substantial doubt about its ability to continue as a going concern.
AMERICAN LIMOUSINE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: American Limousine LLC
DBA Addison Lee
DBA RMA Worldwide Chauffeured Transportation
DBA Tristar
DBA American Limousine Group LLC
DBA Flyte Time Worldwide
90 Mckee Drive
Mahwah, NJ 07430
Business Description: American Limousine LLC operates in the taxi
& limousine services industry.
Chapter 11 Petition Date: January 8, 2021
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 21-10121
Debtor's Counsel: Dean G. Sutton, Esq.
DEAN G. SUTTON, ESQUIRE
18 Green Road
P.O. Box 187
Sparta, NJ 07871
Fax: 973-729-6685
Tel: 973-729-8121
Total Assets: $540,528
Total Liabilities: $14,371,280
The petition was signed by Michael Fogarty, 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/V35VSTI/American_Limousine_LLC__njbke-21-10121__0001.0.pdf?mcid=tGE4TAMA
ASTROTECH CORP: Mark Adams Quits as Director
--------------------------------------------
Mark Adams informed Astrotech Corporation that he is resigning as a
member of the Board of Directors of the Company. The resignation
was effective as of Dec. 31, 2020. Mr. Adams' resignation was not
in connection with any known disagreement with the Company on any
matter.
About Astrotech
Astrotech (NASDAQ: ASTC) -- http://www.astrotechcorp.com-- is a
science and technology development and commercialization company
that launches, manages, and builds scalable companies based on
innovative technology in order to maximize shareholder value. 1st
Detect develops, manufactures, and sells trace detectors for use in
the security and detection market. AgLAB is developing chemical
analyzers for use in the agriculture market. BreathTech is
developing a breath analysis tool to provide early detection of
lung diseases. Astrotech is headquartered in Austin, Texas.
Astrotech reported a net loss of $8.31 million for the year ended
June 30, 2020, compared to a net loss of $7.53 million for the year
ended June 30, 2019. As of Sept. 30, 2020, the Company had $3.18
million in total assets, $4.63 million in total liabilities, and a
total stockholders' deficit of $1.44 million.
Armanino LLP, in San Francisco, California, the Company's auditor
since 2019, issued a "going concern" qualification in its report
dated Sept. 8, 2020, citing that the Company has suffered recurring
losses from operations and has net cash flows deficiencies that
raise substantial doubt about its ability to continue as a going
concern.
ATVT LLC: Seeks to Hire Apel Associates as Accountant
------------------------------------------------------
ATVT LLC seeks approval from the U.S. Bankruptcy Court for the
Western District of Wisconsin to employ Apel Associates Inc., as
its accountant.
The firm's services will include a review of the Debtor's
previously filed tax returns for credits and the 2020 and 2021
income tax returns.
The firm will be paid at a flat fee of $3,500.
Apel Associates is not holding an advanced fee deposit or retainer
of any kind.
Apel Associates is a "disinterested person" as the term is defined
in Section 101(14) of the Bankruptcy Code, according to a court
filing.
The firm can be reached at:
Kari Apel
Apel Associates Inc.
6255 University Ave., Suite #101
Middleton, WI 53562
Phone: 608-960-4700
Fax: 608-960-4750
Email: info@apelcpa.com
Phone: (608) 643-2700
About ATVT LLC
ATVT, LLC, sought Chapter 11 protection (Bankr. W.D. Wis. Case No.
20-11746) on July 6, 2020. At the time of the filing, the Debtor
disclosed assets of between $1 million and $10 million and
liabilities of the same range.
William Wallo is the Subchapter V Trustee appointed in the Debtor's
bankruptcy case. Judge Catherine J. Furay oversees the case.
The Debtor tapped DeMarb Brophy LLC as its legal counsel and Apel
Associates Inc., as its accountant.
BEST VIDEO: Unsecured Creditors to Recover 100% in 5 Years
----------------------------------------------------------
Best Video Studio, LLC, d/b/a IGOTOFFER, filed with the U.S.
Bankruptcy Court for the Eastern District of New York a Disclosure
Statement for Plan of Reorganization on January 5, 2021.
The bankruptcy filing was precipitated by the unilateral and
unappealable action of Amazon Capital Service, Inc., whereby on May
28 of 2018, the Debtor's Amazon account was suspended without an
explanation or possibility of appeal of the decision. Moreover,
the referenced suspension of the Amazon account was further
compounded by the fact that Amazon Capital Service, Inc. has, from
the inception of the case and up through the present time, held and
restrained inventory of the Debtor valued at in the approximately
$1,200,000. Due to the resulting severe financial strain.
The plan provides treatment for creditors that is generally divided
into three classes. The secured class of creditors, designated as
class 1, provides 100% claim distribution to the two secured
creditors in the case.
The unsecured class of creditors, designated as class 2, provides
100% distribution to the holders of undisputed proofs of claim in
the case. The class of unsecured consumer claims, designated as
class 3, provides court ordered treatment to all consumer
claimants, constituting a 100% distribution to the respective
proofs of claim. Holders of allowed claims in Class 2 and Class 3
will receive a 100% dividend in 60 monthly installment payments.
Svetlana Ustinova, the 100% shareholder of the Debtor, comprises
class 4, entitled equity interest holders, and shall retain her
equity interest in the Debtor, having committed to a new value
contribution in the amount of the current estimated business value,
in the amount of approximately $200,000 over the plan terms.
The creditor Amazon Capital Service, Inc., for their respective
unsecured portion of the claim in the amount of $263,732 will not
receive treatment under the Plan, as the Debtor believes that its
financial distress was precipitated by the unilateral actions of
Amazon Capital Service, in restraining the referenced Amazon
account, as well as inventory and the critical fact that the
estimated value of the Debtor's inventory retained by Amazon, far
exceeds the creditor's alleged claim.
The equity interest holder will retain her interest in the Debtor
following confirmation, in consideration of a new value
contribution, being made by her as the equity holder toward the
payment of general unsecured creditor claims. Svetlana Ustinova
will be contributing a total amount of $200,000 over the term of
the plan, in monthly payments, to supplement monthly plan
distributions, as needed.
The Plan will be financed from ongoing business operations, as well
as funds accumulated in the debtor-in-possession bank account of
the Debtor.
A full-text copy of the Disclosure Statement dated Jan. 5, 2021, is
available at https://bit.ly/3bh2Qgo from PacerMonitor.com at no
charge.
Attorney for the Debtor:
ALLA KACHAN, ESQ.
3099 Coney Island Ave, 3rd Floor
Brooklyn, NY 11235
Tel: (718)513-3145
Fax: (347)342-315
E-mail: alla@kachanlaw.com
About Best Video Studio
Best Video Studio, LLC -- https://igotoffer.com/ -- owns an online
business providing the service for consumers to exchange their used
Apple products, such as iPhone, iPad, MacPro, etc. for cash,
through the company's virtual platform.
Best Video Studio filed a Chapter 11 petition (Bankr. E.D.N.Y. Case
No. 19-45523) on Sept. 13, 2019. The Hon. Nancy Hershey Lord
oversees the case. At the time of filing, the Debtor had $200,510
total assets and $1,143,830 total liabilities. Alla Kachan, Esq.
of LAW OFFICES OF ALLA KACHAN, P.C., is the Debtor's counsel.
BOSTON SCIENTIFIC: Egan-Jones Cuts Senior Unsec. Ratings to BB+
---------------------------------------------------------------
Egan-Jones Ratings Company, on December 28, 2020, downgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Boston Scientific Corporation to BB+ from BBB-.
Headquartered in Marlborough, Massachusetts, Boston Scientific
Corporation develops, manufactures, and markets minimally invasive
medical devices.
CAESARS ENTERTAINMENT: Egan-Jones Cuts Sr. Unsec. Ratings to CCC
----------------------------------------------------------------
Egan-Jones Ratings Company, on December 28, 2020, downgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Caesars Entertainment Corporation to CCC from CCC+.
Headquartered in Las Vegas, Nevada, Caesars Entertainment
Corporation provides entertainment, gaming, and lodging services.
CENTRAL PROCESSING: Complaint for Payment of IRS Taxes Dismissed
----------------------------------------------------------------
Judge Terrence G. Berg of the United States District Court for the
Eastern District of Michigan, Southern Division, will dismiss the
complaint brought by the United States of America, on behalf of the
Internal Revenue Service (IRS), for taxes owed by Central
Processing Services.
Central Processing Services (CPS) was the debtor in a prior Chapter
11 bankruptcy case. CPS is in the business of providing printing,
mailing, and lockbox services in the fundraising and medical
industries. The owners are Richard T. Cole and Robert W. Burland.
Cole and Burland also own Associated Community Services, Inc.
(ACS), which is in the business of soliciting donations for
charitable organizations by direct mail and telephone. ACS
previously filed its own Chapter 11 case on March 13, 2014. The
largest creditor in the ACS bankruptcy proceeding was the IRS.
After extensive litigation, ACS and the IRS agreed to an order that
allowed the IRS a claim of just under $12 million. As part of the
settlement, CPS agreed to guarantee part of ACS's debt to the IRS.
On March 6, 2019, CPS also filed for Chapter 11 bankruptcy. Once
again, the IRS was by far the largest creditor. Much like the ACS
Case, the predominant issue in CPS's bankruptcy case was the
treatment of the IRS's claim. On June 28, 2019, CPS filed an
objection to the IRS's proof of claim. On September 5, 2019, the
bankruptcy court issued an opinion holding that the IRS's allowed
claim was entitled to priority under Section 507(a)(8) of the
Bankruptcy Code.
While CPS and the IRS litigated over the allowance and priority of
the IRS's proof of claim, the IRS was also active in seeking other
relief in the case. On August 1, 2019, the United States of
America, on behalf of the IRS, filed a motion to dismiss the
Chapter 11 bankruptcy matter. Plaintiff argued that there was
cause for dismissal under Section 1112(b)(1) of the Bankruptcy Code
for two reasons. First, cause existed under Section 1112(b)(4)(A)
because of a substantial, continuing loss to CPS' estate and the
absence of any reasonable likelihood of rehabilitation. Second,
cause existed under Section 1112(b)(4)(I) because CPS failed to
timely pay post-petition taxes to the IRS.
Plaintiff had attached the form of a proposed order to the
dismissal motion that succinctly stated only that the dismissal
motion is "granted" and that the "bankruptcy case is dismissed for
cause, pursuant to 11 U.S.C. Section 1112(b)(1)." Despite having
submitted such a proposed order, Plaintiff changed course and
indicated at the hearing that it wished to submit a revised
proposed dismissal order. Plaintiff then handed the bankruptcy
judge a paper copy of a revised, much longer proposed order with
the following new provisions: an injunction barring CPS from filing
a bankruptcy case for 180 days; a directive that CPS file all
past-due state and federal tax returns within 30 days; an
injunction barring any payments to CPS' professionals, principals,
and related companies until all post-petition state and federal
taxes were paid in full; a directive that CPS file a schedule of
all post-petition disbursements made by it to its professionals,
principals, and related companies within 30 days; and a provision
for the bankruptcy court to retain jurisdiction "to hear any
motions for disgorgement of any disbursements and payments
necessary to unwind the bankruptcy, and over any fee applications
and objections thereto." Plaintiff explained that it had not yet
circulated a copy of the revised proposed order to CPS, the United
States Trustee, or any other parties, but had copies available to
distribute to them at the hearing.
CPS, the United States Trustee, and all creditors in attendance at
the hearing requested that they be given an opportunity to review
and approve the form of any revised proposed dismissal order before
submission to the bankruptcy court for entry. The bankruptcy court
granted the dismissal motion, finding that Plaintiff had
established cause for dismissal under section 1112(b), and finding
that the IRS, CPS, the United States Trustee, and all creditors in
attendance at the hearing agreed that the case should be
dismissed.
However, the bankruptcy judge explained that he would not try to
settle the form of the proposed order on the record at the hearing
because CPS, the United States Trustee, and the creditors at the
hearing had not yet seen Plaintiff's revised proposed order with
its new provisions. In addition, CPS and the United States Trustee
both stated that they too had additional terms that they wished to
include in the order. The bankruptcy judge instructed Plaintiff,
as the prevailing party, to prepare and circulate to CPS, the
United States Trustee, and the creditors who attended the hearing a
draft of a proposed order and seek their approval as to its form.
The bankruptcy judge further instructed Plaintiff that if it was
unable to promptly obtain approval by all parties to the form of a
dismissal order, then Plaintiff should use the procedure set forth
in the Local Bankruptcy Rules for the presentment of a proposed
order.
The bankruptcy judge was willing to permit the parties some time
following the hearing to agree on the form of an order to
memorialize the bankruptcy court's ruling dismissing CPS' Chapter
11 case. However, two weeks went by after the hearing without a
proposed order being submitted to the court. Hearing nothing
further from the parties, on September 23, 2019, the bankruptcy
court entered an order dismissing the case to avoid further delay.
The dismissal order stated that the dismissal motion was granted
and that the Chapter 11 case was dismissed under section 1112(b) of
the Bankruptcy Code. The dismissal order granted only the
dismissal of CPS' Chapter 11 bankruptcy matter, and contained none
of the additional provisions that Plaintiff sought to be included
in the draft of the revised proposed order that it presented to the
bankruptcy judge and the parties at the hearing. The only
difference between the dismissal order and the original proposed
order that Plaintiff had attached to the dismissal motion was that
the dismissal order required any fee applications or other requests
for relief to be filed no later than October 7, 2019. The
bankruptcy court added that deadline to ensure that if there were
any further filings by any party in the dismissal case, they would
be made as soon as possible so that the court could promptly close
the case consistent with its ordinary practice.
On October 2, 2019, CPS' professionals, Defendants here, filed
applications for compensation, or fee applications, for their
services rendered during the course of the bankruptcy proceeding as
allowed pursuant to 11 U.S.C., to which the Plaintiff objected.
The bankruptcy court scheduled a hearing on the fee applications
for November 22. Around the same time, after the bankruptcy court
dismissed the CPS' bankruptcy matter, Plaintiff filed a
post-dismissal request for relief, moving for an accounting and
disgorgement of the Defendants' professional fees, to which the
Defendants objected.
While the parties were awaiting the hearing on the fee
applications, on November 5, 2019, the bankruptcy court issued an
opinion and order denying Plaintiff's motion to disgorge. The
bankruptcy court found that it had jurisdiction over the
disgorgement motion because the acts giving rise to the motion
occurred while CPS was a debtor. The bankruptcy court declined to
exercise its jurisdiction, finding that the request for an
accounting was a discovery request and that, because there was no
pending matter within the bankruptcy case, there would be no
bankruptcy-law purpose to granting such discovery. The bankruptcy
court agreed that all administrative expense claims were entitled
to pro rata treatment, however, it declined to order such treatment
because there had been no distribution of estate property and would
be no distribution of estate property because the case had been
dismissed and the property had revested. On November 20, 2019,
Plaintiff appealed the bankruptcy court's order to the District
Court.
At the November 22, 2019 hearing on Defendants' fee applications,
Plaintiff made an oral motion for reconsideration of the
disgorgement motion or, in the alternative, for the bankruptcy
court to abstain from ruling on the fee applications filed by the
Defendants. On December 3, 2019, the bankruptcy court issued orders
granting in part and denying in part the fee applications and
denying Plaintiff's oral motion for reconsideration or abstention.
The bankruptcy judge found that Plaintiff had waived those
arguments because it did not raise them in writing or at any time
before the hearing. The bankruptcy judge added that Plaintiff
cited to no case law in support of its oral requests. As it had
with the opinion and order denying Plaintiff's motion to disgorge,
Plaintiff also appealed the order to the District Court.
On September 18, 2020, the District Court issued orders affirming
the two decisions of the bankruptcy judge.
While Plaintiff's two appeals were pending, Plaintiff filed its
Complaint before the District Court. Plaintiff advanced two new
theories related to the same disputed funds that were at issue in
CPS' Chapter 11 bankruptcy matter. For its first claim, Plaintiff
alleged that because CPS failed to pay some of its tax obligations,
the fees Defendants received from CPS were subject to a trust held
in favor of the United States. In its second claim, Plaintiff
alleged that the fees held by Defendants are subject to federal tax
liens that arose upon assessment of tax against ACS. In opposing
the action, Defendants each filed a motion to dismiss for failure
to state a claim on the theory that res judicata bars Plaintiff's
claims.
Judge Berg explained that "in the bankruptcy matter, Plaintiff
asserted its statutory right by requesting an accounting and
arguing that it was entitled to pro rata sharing of the bankruptcy
estate pursuant to the Bankruptcy Code... But the bankruptcy court
rejected both of Plaintiff's assertions, reasoning that because
there was no pending matter within the bankruptcy case, a request
for accounting amounted to an inappropriate discovery request... As
for pro rata sharing of the funds to Plaintiff pursuant to the
Bankruptcy Code, the bankruptcy court declined to order such
treatment after it found that there had been no distribution of
estate property and would be no distribution of estate property...
In light of its findings, the bankruptcy court then concluded in
its discretion that it should not exercise jurisdiction... The
decision to decline to exercise jurisdiction for related to the
underlying merits of Plaintiff's arguments; it is not comparable to
a dismissal for lack of subject matter jurisdiction. Accordingly,
the bankruptcy court's decision to decline Plaintiff's requested
relief under certain statutory rights constituted 'the death knell
of the litigation and has the same effect as a dismissal on the
merits.'"
Judge Berg held that all the elements of res judicata were present.
"Plaintiff advances two allegations against Defendants which
relate to some if not all of the fees that the bankruptcy court
awarded the Defendants... But in attempting to disprove that there
is an identity of claims, Plaintiff misses the mark. Plaintiff
does not argue that the facts are different in this case from the
bankruptcy case—it does not claim, for example, that the funds in
dispute before this court are different from those that were in
issue before the bankruptcy court. Rather, Plaintiff is offering
different legal bases to support its claims as to which party is
entitled to take possession of the exact same funds. These are
questions of law regarding the same operative facts and series of
transactions. And they are the kinds of questions that the
bankruptcy court already addressed at length and that this Court
affirmed. See Bankr... Therefore, the Court finds that there is an
identity of claims between this case and the preceding bankruptcy
matter." he said.
The case is UNITED STATES OF AMERICA, Plaintiff, v. SCHAFER AND
WEINER, PLLC, et al., Defendant, Case No. 2:19-CV-13696 (E.D.
Mich.). A full-text copy of the Order Granting Defendants' Motion
to Dismiss, dated December 30, 2020, is available at
https://tinyurl.com/y5tdwfcq from Leagle.com.
About Central Processing Services
Central Processing Services, LLC, based in Southfield, Mich., is a
provider of printing, mailing and lockbox services in the
fundraising and medical industries. The Debtor filed a Chapter 11
petition (Bankr. E.D. Mich. Case No. 19-43217) on March 6, 2019.
The case was pending for just about six months. On August 1, 2019,
the United States of America, on behalf of the Internal Revenue
Service, moved to dismiss the Debtor's case, which the Court
granted at a hearing on September 6, 2019.
In the petition signed by Richard T. Cole, authorized member, the
Debtor estimated $1 million to $10 million in assets, and $10
million to $50 million in liabilities. The Hon. Maria L. Oxholm
oversees the case. John J. Stockdale, Jr., Esq., at Schaefer and
Weiner, PLLC, serves as bankruptcy counsel, and Harmon Partners,
LLC, is the financial advisor.
CHURCHILL DOWNS: Moody's Affirms Ba3 CFR, Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service revised Churchill Downs Incorporated's
outlook to stable from negative. Moody's also affirmed CHDN's Ba3
Corporate Family Rating, Ba3-PD Probability of Default Rating, Ba1
senior secured, and B1 senior unsecured ratings. Churchill's SGL-2
Speculative Liquidity Rating remains unchanged.
Moody's decision to revise CHDN's rating outlook to stable from
negative follows the company's recent announcement that it repaid
approximately $545 million of outstanding revolver borrowings from
its existing cash resources. Pro forma for the repayment, the
company has about $546 million of availability under its revolver,
and approximately $50 to $60 million of unrestricted cash.
"The revolver repayment along with a lower cost structure and
relatively strong quarterly results reported for the quarter ended
30-Sept 2020, a trend Moody's believes will continue despite the
ongoing effects of COVID-19, has improved the company's ability to
bring its debt-to-EBITDA leverage back down to a range more
consistent with CHDN's Ba3 Corporate Family Rating by the end of
2021 - between 4.5x and 5.5x times," stated Keith Foley, a Senior
Vice President at Moody's.
"Additionally, the stable outlook assumes CHDN's gaming and horse
racing businesses will continue to operate without interruption and
that capacity restrictions will be eased over time," added Foley.
CHDN's debt/EBITDA pro forma for the revolver repayment on a
Moody's adjusted basis for the latest 12-month period ended
September 2020 was 8.4x and significantly affected by several
months of temporary asset closures during March through June
related to the coronavirus pandemic.
Moody's also assumes in the stable outlook that CHDN will maintain
good liquidity including the ability to comfortably meet the 4.0x
senior secured debt-to-EBITDA leverage ratio covenant that returns
during the September 30, 2021 quarter. On April 28, 2020, CHDN
entered into the second amendment to its credit agreement, which
provided for a financial covenant relief period through the fiscal
quarter ending June 30, 2021. Senior secured covenant leverage was
about 3.4x as of September 2020 and Moody's estimates was
approximately 2.8x pro forma for the revolver repayment.
Moody's took the following rating actions:
Affirmations:
Issuer: Churchill Downs Incorporated
Probability of Default Rating, Affirmed Ba3-PD
Corporate Family Rating, Affirmed Ba3
Senior Secured Bank Credit Facility (revolver and term loan),
Affirmed Ba1 (LGD2)
Senior Unsecured Regular Bond/Debenture, Affirmed B1 (LGD5)
Outlook Actions:
Issuer: Churchill Downs Incorporated
Outlook, Changed To Stable From Negative
RATINGS RATIONALE
CHDN's credit profile and Ba3 CFR reflects the strong history,
popularity and performance of the Kentucky Derby along with the
company's practice of operating with moderate leverage during
normal operating conditions. Also viewed favorably is the
consistent and stable performance of TwinSpires.com, the company's
horse racing digital wagering platform.
Key credit concerns include the highly discretionary nature of
consumer spending on traditional gaming and betting activities in
general. Additionally, despite some level of asset, product and
geographic diversity, the Kentucky Derby continues to account for a
significant portion of the company's consolidated segment EBITDA.
Also of concern are CHDN's current high leverage, continued
pressure from efforts to contain the coronavirus, potential for a
slow longer-term recovery, and long-term fundamental challenges
facing regional gaming companies.
The coronavirus outbreak, the government measures put in place to
contain it, and the weak global economic outlook continue to
disrupt economies and credit markets across sectors and regions.
Moody's analysis has considered the effect on the performance of
CHDN from the current weak US economic activity and a gradual
recovery for the coming year. 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 Moody's 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 gaming sector has been one of the sectors most significantly
affected by the shock given its sensitivity to consumer demand and
sentiment. More specifically, the weaknesses in CHDN's credit
profile, including its exposure to travel disruptions and
discretionary consumer spending have left it vulnerable to shifts
in market sentiment in these unprecedented operating conditions and
CHDN remains vulnerable to the outbreak continuing to spread.
CHDN, like other casinos owners and operators, is exposed to
elevated social risks, particularly in terms of evolving
demographic and societal trends that may drive a change in demand
away from traditional casino style gaming. The risks are somewhat
mitigated by having non-gaming attractions including hotels,
restaurants, bars, and entertainment venues.
Data security and customer privacy risk is elevated given the large
amount of data collected on customer behavior. In the event of data
breaches, the company could face higher operational costs to secure
processes and limit reputational damage.
Governance factors include targeting a moderate leverage level, but
with event risk related to debt-funded acquisitions. The company
also pays a dividend that weakens free cash flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade include a high degree of
confidence that the gaming sector has returned to a period of
long-term stability, positive free cash flow and the maintenance of
good liquidity, and the ability and willingness of CHDN to achieve
and maintain debt/EBITDA at 4.0x or lower on a Moody's adjusted
basis.
A downgrade could result if revenue and earnings decline due to
renewed facility shutdowns, reduced visitation or increased
competition, it appears that CHDN will not be able to achieve and
maintain debt/EBITDA below 5.5x on a Moody's adjusted basis, or
liquidity deteriorates for any reason.
CHDN is a racing, online wagering and gaming entertainment company
that owns and operates: The Kentucky Derby; three pari-mutuel
gaming entertainment venues in Kentucky: Derby City Gaming, Oak
Grove Racing, Gaming, and Hotel, and Newport Racing and Gaming;
TwinSpires.com, which is the largest online horse racing wagering
platform in the U.S.; Sports betting and iGaming through the
BetAmerica platform in multiple states; and brick-and-mortar casino
gaming with approximately 11,000 slot machines and video lottery
terminals and 200 table games in eight states. CHDN is organized in
3 reporting business segments: Churchill Downs, On-line Wagering,
and Gaming. Net revenue for the latest 12- month period ended
September 30, 2020 was $1,056 billion. The company is publicly
traded (NASDAQ:CHDN).
The principal methodology used in these ratings was Gaming
Methodology published in October 2020.
CLEARPOINT CHEMICALS: Feb. 23 Disclosure Hearing Set
----------------------------------------------------
On Jan. 4, 2021, debtor Clearpoint Chemicals, LLC, filed with the
U.S. Bankruptcy Court for the Southern District of Alabama a
disclosure statement and plan. On Jan. 5, 2021, Judge Jerry C.
Oldshue, Jr. ordered that:
* Feb. 23, 2021 at 9:30 a.m. at the U.S. Bankruptcy Court,
Judge Oldshue's Courtroom 2 East, 5th Floor, 113 St. Joseph Street,
Mobile AL, 36602 is the hearing to consider the approval of the
disclosure statement.
* Feb. 16, 2021 is fixed as the last day for filing and
serving written objections to the disclosure statement with the
Court.
The Debtor has filed a Plan of Reorganization. The Debtor will
restructure and shall fully pay all secured claims over a period of
60 months with a balloon payment at the end of the 60-month term.
Unsecured creditors, owed $18.28 million, will receive the sum of
$1 million over a five year term in five annual payments of
$200,000 each.
A full-text copy of the order entered Jan. 5, 2021, is available at
https://bit.ly/3s7bVhB
A copy of the Disclosure Statement filed Jan. 4, 2021, is available
at https://bit.ly/38qqcOC
About Clearpoint Chemicals
Clearpoint Chemicals, LLC, operates in the specialty chemical
services industry. It develops customer-specific chemical
solutions, provides in-house last mile logistics, and delivers
on-site application and management, and continued communication and
project assessment services.
Clearpoint Chemicals sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Ala. Case No. 20-12274) on Sept. 29,
2020. At the time of the filing, the Debtor estimated assets of
between $10 million and $50 million and liabilities of the same
range.
Judge Jerry C. Oldshue oversees the case.
The Debtor tapped Silver, Volt & Garrett as its bankruptcy counsel
and R. Tate Young, Esq., an attorney practicing in Houston, as its
special counsel.
COMMUNITY INTERVENTION: FBTS Buying All Assets of Futures for $7.5M
-------------------------------------------------------------------
Futures Behavior Therapy Center, LLC, an affiliate of Community
Intervention Services, Inc. ("CIS"), asks the U.S. Bankruptcy Court
for the District of Massachusetts to authorize the sale of
substantially all of Futures' assets it utilized in operating its
assets to FBTC Transitional Sub, LLC ("FBTS") or its eligible
designee for $7.5 million, subject to certain adjustments, subject
to overbid.
The assets include without limitation to:
(i) Futures' rights under two leases of real property at
which Futures operates its facilities,
(ii) certain personal property, including equipment,
furniture and inventory,
(iii) certain contracts with third parties,
(iv) certain permits and licenses authorizing the provision
of certain services to South Bay clients (to the extent
transferable), and
(v) certain other miscellaneous, specified assets as set
forth in the Asset Purchase Agreement dated as of
Jan. 5, 2021, between the Debtors and FBTS, including
the right to use Futures' trade names and other
intellectual property.
Futures has filed a related motion for approval of sale procedures
filed concurrently with the Motion.
The Assets are subject to various liens and security interests,
including those senior secured liens and security interests of
Capital One, National Association and Fifth Third Bank, acting
through Capital One as thee Senior Agent. As of the Petition Date,
the Senior Lenders hold a prepetition first priority senior secured
claim against the Debtors in the amount of at least $48,708,645,
exclusive of accrued and accruing legal fees and expenses and
additional interest and loan charges accruing on or after Dec. 30,
2020, evidenced by a series of agreements and instruments
including, inter alia:
(a) that Credit Agreement dated as of July 16, 2015, by and
among CIS, South Bay, Futures, and certain other
non-Debtors, as borrowers ("Borrowers"), Debtor Community
Intervention Services Holdings, Inc., and certain other
non-Debtors as guarantors, Senior Agent and the other
Senior Lenders; and
(b) that certain Guaranty and Security Agreement dated as of
July 16, 2015, by and among the Borrowers, Guarantors, and
Senior Agent ("Senior Loan Documents").
Futures commenced operations in Beverly, Massachusetts in 2006,
initially as a one-room and later as a two-room facility, providing
treatment to children and adolescents with autism spectrum
disorders. Currently, the program operates at two locations, in
Beverly and West Boylston, Massachusetts. The West Boylston
location opened in March of 2019. In total, Futures employs
approximately 104 individuals (including applied behavior analysis
therapists, registered behavior technicians, occupational
therapists, speech pathologists) on a full-time basis, and
approximately 22 employees on a part-time basis.
Futures was acquired by CIS in 2015. CIS was formed in 2012 by the
private equity fund manager H.I.G. Capital, LLC to pursue
acquisitions of behavioral health companies; the Debtor South Bay
was its first acquisition. One hundred percent of the shares of
CIS are held by Community Intervention Services Holdings, Inc.
H.I.G. Growth Partners-CIS, LLC holds a majority of Holdings'
shares (over 70%); the remaining shares are held by various
investors.
The Debtors financed their acquisitions and operations with secured
financing provided by institutional and private lenders. Their
largest creditors are the Senior Lenders, who made available a $55
million credit facility evidenced by the Senior Loan Documents. As
of the Petition Date, the total aggregate amount of the Senior
Lender Claim was at least $48,708,645, exclusive of accrued and
accruing legal fees and expenses and additional interest and loan
charges accruing on or after Dec. 30, 2020.
Pursuant to the Senior Loan Documents, the Senior Agent, on behalf
of itself and the Senior Lenders, holds a first priority security
interest in substantially all assets of the Debtors. That security
interest entitles the Senior Lenders to the net proceeds of the
Proposed Sale, and the Debtor in its proposed sale order provide
for such payment.
The Debtors (together with the Non-Debtor Entities) also obtained
subordinated secured financing pursuant to a Credit Agreement dated
July 16, 2015, as amended, with Triangle Mezzanine Fund LLLP,
acting for itself and as agent for certain other lenders, pursuant
to which they borrowed $25.25 million secured by a second-priority
security interest in the assets of the Debtors and the Non-Debtor
Entities. Triangle subsequently assigned its rights under the
Mezzanine Loan Documents to BSP Agency, LLC. Pursuant to the
Mezzanine Loan Documents and the Subordination Agreement, the
Mezzanine Lenders hold a security interest in substantially all
assets of the Debtors that is junior in priority to the security
interest held by the Senior Lenders.
Because of the payment and lien subordination along with the
magnitude of the Senior Lender Claim and the apparent value of the
Debtors' assets subject to the Senior Prepetition Liens, the
Debtors believe that the Mezzanine Agent and the Mezzanine Lenders
will receive no sale proceeds.
Aside from their substantial obligations to their secured
creditors, the Debtor South Bay is obligated to pay $1.82 million
to the Commonwealth of Massachusetts arising out of a 2018
settlement of certain whistleblower litigation, and $7.8 million in
advance payments made in spring 2020 to support the Debtors'
operations during the COVID-19 pandemic. The Debtors have
generally maintained good relationships with their trade creditors,
and have endeavored to avoid any substantial build-up of
"out-of-term" trade payables.
Other significant liabilities include Futures' obligations under
two leases of real property at which Futures conducts its autism
education programs. As of the Petition Date, Futures was current
in the payment of its lease obligations. The Debtor expects that
these two leases will be assumed and assigned to FBTS (or other
purchaser) pursuant to Section 365 of the Bankruptcy Code as part
of the Proposed Sale, and that there will be minimal if any cure
costs associated with such assumption and assignment.
The Senior Lenders have agreed to fund the Debtors' sale effort
through the Chapter 11 case pursuant to an agreed budget and
proposed cash collateral order attached to their Motion for Interim
and Final Orders Authorizing Use of Cash Collateral, based on the
Debtors' agreement that the net sale proceeds from each of the two
asset sales (i.e. (i) the Proposed Sale and (ii) the South Bay
sale) will immediately be turned over to the Senior Agent, on
behalf of the Senior Lenders, on account of the Senior Lender
Claim.
The APA and the designation of FBTS as the stalking horse bidder
for the Proposed Sale is the result of a prepetition sale process
undertaken by the Debtor under the guidance of its financial and
legal advisors and with the assistance of their investment bankers.
That sale process will continue pursuant to sale procedures
approved by the Court.
The Debtor has filed a motion asking such approval, for a sale
process leading to solicitation of competing bids by no later than
Jan. 25, 2021; an auction among competing bidders conducted soon
thereafter; the Debtor's prompt post-auction selection of the
winning bidder to purchase the Assets pursuant to the final
negotiated APA; a sale hearing to be conducted promptly thereafter
to obtain the Court's approval of the Proposed Sale; and the
closing of the sale of the Assets pursuant to the final APA as
promptly as the closing conditions can be satisfied.
Under the APA, the Assets to be sold constitute substantially all
of Futures' assets it utilized in operating its business, including
without limitation the Leases and the Futures Assumed Contracts.
Because the Proposed Sale contemplates the sale of Futures'
business as a going concern, and because the Debtor believes that
the highest and best value for their assets will be obtained
through a sale of Futures' business as a going concern, the Debtor
does not anticipate that prospective competing bidders will be
interested in acquiring less than substantially all of Futures'
assets. The Debtor, in consultation with the Secured Lenders, will
designate which offer (or combination of offers) represents the
highest or otherwise best offer for their assets, and will ask
Court approval of such offer.
FBTS has agreed to pay the Debtor $7.5 million for the Assets
(subject to certain adjustments as set forth in the APA). Under
the APA, FBTS has delivered an earnest money deposit of $375,000.
The deposit will be applied to the cash purchase price at closing.
Under the APA, FBTS has agreed to assume only certain, limited
liabilities of the Debtor--principally, its obligations under the
Assumed Contracts that first arise post-closing. FBTS has,
however, conditioned its acquisition of the Assets on the full
payment of all pre-closing obligations owed by the Debtor to those
of their employees that will be hired by FBTS incident to the
closing of the sale.
In addition, the APA requires that the following obligations be
paid from closing proceeds: (i) the costs of curing defaults
arising under the Assumed Contracts, and (ii) investment banking
fees. The Debtor's proposed sale order provides for the payment of
the Buyer Payment Amount by FBTS with the remainder of the sale
proceeds at closing being remitted at closing to the Senior Agent
in partial satisfaction of the Senior Lender Claim. The Debtor, in
consultation with the Senior Agent, will take offers to assume
liabilities into account in determining the highest or otherwise
best offer to be obtained by the Debtor and its bankruptcy estates
through the sale process.
The Debtor presumes that any prospective purchaser of the Assets
would want to retain most of its employees through offers of
employment to be effective at closing of the sale transaction.
FBTS contemplates that it will do so, and the Debtor would expect
any prospective bidder to offer employment to substantially the
same degree as FBTS has indicated it plans to do.
The Proposed Sale of the Assets, including the assignment of the
Assumed Contracts, is to be made free and clear of all liens,
claims, and interests.
The ability of FBTS--or of any other acquirer of the Assets--to
operate Futures' business is conditioned on its having been
approved and licensed to do so by the Commonwealth of Massachusetts
acting through its Department of Early Education and Care. The
Debtor expects that necessary regulatory approval can be sought
promptly after Court approval of the Proposed Sale, and that such
approval can reasonably be obtained within 30 days after being
sought.
In consideration of FBTS' expenditure of considerable time and
expense in pursuing the Proposed Sale and entering into the APA by
which FBTS serves as the stalking horse bidder, the Debtor has
agreed to pay FBTS a break-up fee of $350,000 if another competing
bidder submits a higher or otherwise better offer to acquire the
Assets that is accepted by the Debtor, approved by the Court, and
closes.
To ensure that the overall value from sale of the Assets is not
diminished by the necessity of paying the break-up fee, the
Debtor's proposed sale procedures provide that the minimum amount
of any competing bids must have a value not less than $450,000 more
than the $7.5 million cash purchase price provided.
The Debtor has concurrently with the sale motion filed a motion for
an order of the Court establishing procedures for its solicitation
of competing bids to acquire the Assets, and otherwise governing
the conduct of the Proposed Sale.
Incident to the Proposed Sale and following the payment by FBTS of
the Buyer Payment Amount, the Debtor will ask Court authority to
disburse sale proceeds to pay the remaining net sale proceeds to
the Senior Agent, on behalf of and for the benefit of the Senior
Lenders, on account of the Senior Lender Claim. Payments proposed
to be made from sale proceeds at closing that would otherwise be
paid to the Senior Lenders include the payment of amounts due to
certain members of the Debtor's senior management team pursuant to
a management incentive plan approved by the Senior Agent and Senior
Lenders.
No payment will be made to the Mezzanine Lenders from sale
proceeds. The Debtor currently anticipates that there will be
insufficient proceeds from the sale of the Assets to pay anything
on account of general unsecured claims.
Given these considerations, the Debtor believes that the Proposed
Sale provides the best path forward for the bankruptcy estate, the
Debtor's creditors, and its clients who stand to benefit greatly
from the sale of Futures' business as a going concern.
Any party interested in submitting an offer to purchase the Assets
(or any portion thereof) should contact the Debtors' counsel at the
earliest possible date, and comply with the deadline and governing
procedures for submission of offers to be established by the
Court.
A copy of the APA is available at https://bit.ly/3op5Yuh from
PacerMonitor.com free of charge.
About Community Intervention
Services, Inc.
Community Intervention Services, Inc. sought Chapter 11 protection
(Bankr. D. Mass. Case No. 21-40002EDK). The case is being
jointly administered with the bankruptcy cases of its affilliates
Community Intervention Services Holdings, Inc., Futures Behavior
Therapy Center, LLC, and South Bay Mental Health Center, Inc.
COMMUNITY INTERVENTION: SBTS Buying South Bays Assets for $32M
--------------------------------------------------------------
Community Intervention Services, Inc. ("CIS") and South Bay Mental
Health Center, Inc. ask the U.S. Bankruptcy Court for the District
of Massachusetts to authorize the sale of substantially all of
South Bay's assets it utilized in operating its assets, to SB
Transitional Sub, LLC ("SBTS") or its eligible designee for $32
million, subject to certain adjustments, subject to overbid.
The assets include without limitation to:
(i) South Bay's rights under leases of real property at
which South Bay operates its clinics,
(ii) certain personal property, including equipment,
furniture and inventory,
(iii) certain contracts with third parties,
(iv) certain permits and licenses authorizing the provision
of certain services to South Bay clients (to the extent
transferable), and
(v) certain other miscellaneous, specified assets as set
forth in the Asset Purchase Agreement dated as of
Jan. 5, 2021, between the Debtors and SBTS.
The Assets are subject to various liens and security interests,
including those senior secured liens and security interests of
Capital One, National Association and Fifth Third Bank, acting
through Capital One as thee Senior Agent. As of the Petition Date,
the Senior Lenders hold a prepetition first priority senior secured
claim against the Debtors in the amount of at least $48,708,645,
exclusive of accrued and accruing legal fees and expenses and
additional interest and loan charges accruing on or after Dec. 30,
2020, evidenced by a series of agreements and instruments
including, inter alia:
(a) that Credit Agreement dated as of July 16, 2015, by and
among CIS, South Bay, Futures, and certain other
non-Debtors, as borrowers ("Borrowers"), Debtor Community
Intervention Services Holdings, Inc., and certain other
non-Debtors as guarantors, Senior Agent and the other
Senior Lenders; and
(b) that certain Guaranty and Security Agreement dated as of
July 16, 2015, by and among the Borrowers, Guarantors, and
Senior Agent ("Senior Loan Documents").
Founded in 1986, South Bay has grown to be one of the largest
for-profit outpatient and community-based providers of behavioral
health services in Massachusetts. At present, it operates through
22 offices, with 21 located throughout the Commonwealth and one
office in Hartford, Connecticut. In the first 10 months of 2020,
South Bay generated approximately $48.45 million in revenue. It
provides services to more than 20,000 clients, for whom these
services provide critical assistance in managing behavioral health
and substance abuse problems.
In 2012, South Bay was acquired by CIS, its sole stockholder. CIS
was formed in 2012 by the private equity fund manager H.I.G.
Capital, LLC to pursue acquisitions of behavioral health companies;
South Bay was its first acquisition. One hundred percent of the
shares of CIS are held by Community Intervention Services Holdings,
Inc. ("Holdings"). H.I.G. Growth Partners-CIS, LLC holds a
majority of Holdings' shares (over 70%); the remaining shares are
held by various investors.
CIS financed its acquisitions and its subsidiaries' operations with
secured financing provided by institutional and private lenders.
The Debtors' largest creditors are the Senior Lenders, who made
available a $55 million credit facility evidenced by the Senior
Loan Documents. As of the Petition Date, as noted, the total
aggregate amount of the Senior Lender Claim was at least
$48,708,645, exclusive of accrued and accruing legal fees and
expenses and additional interest and loan charges accruing on or
after Dec. 30, 2020.
The Debtors (together with the Non-Debtor Entities) also obtained
subordinated secured financing pursuant to a Credit Agreement dated
July 16, 2015, as amended, with Triangle Mezzanine Fund LLLP,
acting for itself and as agent for certain other lenders, pursuant
to which they borrowed $25.25 million secured by a second-priority
security interest in the assets of the Debtors and the Non-Debtor
Entities. Triangle subsequently assigned its rights under the
Mezzanine Loan Documents to BSP Agency, LLC. Pursuant to the
Mezzanine Loan Documents and the Subordination Agreement, the
Mezzanine Lenders hold a security interest in substantially all
assets of the Debtors that is junior in priority to the security
interest held by the Senior Lenders.
Because of the payment and lien subordination along with the
magnitude of the Senior Lender Claim and the apparent value of the
Debtors' assets subject to the Senior Prepetition Liens, the
Debtors believe that the Mezzanine Agent and the Mezzanine Lenders
will receive no sale proceeds.
Aside from their substantial obligations to their secured
creditors, the Debtor South Bay is obligated to pay $1.82 million
to the Commonwealth of Massachusetts arising out of a 2018
settlement of certain whistleblower litigation, and $7.8 million in
advance payments made in spring 2020 to support the Debtors'
operations during the COVID-19 pandemic. The Debtors have
generally maintained good relationships with their trade creditors,
and have endeavored to avoid any substantial build-up of
"out-of-term" trade payables.
Other significant liabilities include the Debtors' obligations
under leases of real property at which they conduct their business
operations; South Bay is a tenant under 22 leases, and CIS is a
tenant under one lease. As of the Petition Date, the Debtors were
current in the payment of their lease obligations. They expect
that most if not all of these leases will be assumed and assigned
to SBTS (or other purchaser) pursuant to Section 365 of the
Bankruptcy Code as part of the Proposed Sale, and that there will
be minimal if any cure costs associated with such assumption and
assignment.
The Senior Lenders have agreed to fund the Debtors' sale effort
through the Chapter 11 case pursuant to an agreed budget and
proposed cash collateral order attached to the Debtors' Motion for
Interim and Final Orders Authorizing Use of Cash Collateral, based
on the Debtors' agreement that the net sale proceeds from each of
the two asset sales (i.e. (i) the Proposed Sale and (ii) the
Futures sale) will immediately be turned over to the Senior Agent,
on behalf of the Senior Lenders, on account of the Senior Lender
Claim.
The APA and the designation of SBTS as the stalking horse bidder
for the Proposed Sale is the result of a prepetition sale process
undertaken by the Debtors under the guidance of their financial and
legal advisors and with the assistance of their investment bankers.
That sale process will continue pursuant to sale procedures
approved by the Court.
Under the APA, SBTS has agreed to assume only certain, limited
liabilities of the Debtors--principally, the Debtors' obligations
under the Assumed Contracts that first arise post-closing. SBTS
has, however, conditioned its acquisition of the Assets on the full
payment of all pre-closing obligations owed by the Debtors to those
of their employees that will be hired by SBTS incident to the
closing of the sale.
The Debtors presume that any prospective purchaser of the Assets
would want to retain most of their employees through offers of
employment to be effective at closing of the sale transaction.
SBTS contemplates that it will do so, and the Debtors would expect
any prospective bidder to offer employment to substantially the
same degree as SBTS has indicated it plans to do.
The Proposed Sale of the Assets will be free and clear of all
liens, claims, and interests. Any and all such liens, claims, and
interests will attach with equal effect and priority to the
proceeds of sale.
The ability of SBTS--or of any other acquirer of the Assets--to
operate South Bay's business is conditioned on its having been
approved and licensed to do so by the Commonwealth of Massachusetts
acting through its Department of Public Health. The Debtors expect
that necessary regulatory approval can be sought promptly after
Court approval of the Proposed Sale, and that such approval can
reasonably be obtained within 60 days after being sought.
In consideration of SBTS' expenditure of considerable time and
expense in pursuing the Proposed Sale and entering into the APA by
which SBTS serves as the stalking horse bidder, the Debtors have
agreed to pay SBTS a break-up fee of $640,000 if another competing
bidder submits a higher or otherwise better offer to acquire the
Assets that is accepted by the Debtors, approved by the Bankruptcy
Court, and closes. The break-up fee will be paid only upon closing
of the alternate sale transaction, and only out of the proceeds of
sale.
To ensure that the overall value from sale of the Assets is not
diminished by the necessity of paying the break-up fee, the
Debtors' proposed sale procedures provide that the minimum amount
of any competing bids must have a value not less than $890,000 more
than the $32 million cash purchase price provided by the APA.
These arrangements are subject to approval of the Court incident to
the Debtors' motion to establish sale procedures for the Proposed
Sale.
In addition, the APA requires that the following obligations be
paid from closing proceeds: (i) the costs of curing defaults
arising under the Assumed Contracts, (ii) payments to The
Commonwealth of Massachusetts deemed necessary to effectuate the
conveyance of the Assets and (iii) investment banking fees. The
Debtors' proposed sale order provides for the payment of the Buyer
Payment Amount by SBTS with the remainder of the sale proceeds at
closing being remitted at closing to the Senior Agent in partial
satisfaction of the Senior Lender Claim.
The Debtors have filed a motion asking such approval, for a sale
process leading to solicitation of competing bids by mid-February;
an auction among competing bidders conducted soon thereafter; the
Debtors' prompt post-auction selection of the winning bidder to
purchase the Assets pursuant to the final negotiated APA; a sale
hearing to be conducted promptly thereafter to obtain the Court’s
approval of the Proposed Sale; and the closing of the sale of the
Assets pursuant to the final APA as promptly as the closing
conditions can be satisfied.
Any party interested in submitting an offer to purchase the Assets
(or any portion thereof) should contact the Debtors' counsel at the
earliest possible date, and comply with the deadline and governing
procedures for submission of offers to be established by the Court.
The deadline for submitting an objection will be set by the Court,
as will the date of the hearing on the Motion at which objecting
parties may be heard.
A copy of the APA is available at https://bit.ly/3pWu0gK from
PacerMonitor.com free of charge.
Counsel for Debtors:
Michael J. Goldberg, Esq.
A. Davis Whitesell, Esq.
Hanna J. Ciechanowski, Esq.
CASNER & EDWARDS, LLP
303 Congress Street
Boston, MA 02210
Telephone: 617-426-5900
E-mail: whitesell@casneredwards.com
About Community Intervention
Services, Inc.
Community Intervention Services, Inc. sought Chapter 11 protection
(Bankr. D. Mass. Case No. 21-40002EDK). The case is being
jointly administered with the bankruptcy cases of its affiliates
Community Intervention Services Holdings, Inc., Futures Behavior
Therapy Center, LLC, and South Bay Mental Health Center, Inc.
COMSTOCK MINING: Key Employees to Get 1.26M Performance Share Units
-------------------------------------------------------------------
The Compensation Committee of the Board of Directors of Comstock
Mining Inc. authorized a grant of 1,260,000 performance share units
to key employees of the Company. The Executive Chairman and CEO of
the Company was among the recipients of such performance share
units, with a grant of 500,000 performance share units. Vesting of
the awards is conditioned upon the achievement of strategic
performance objectives of the Company described in the Comstock
Mining Inc. 2020 Equity Incentive Plan, for half of the award, and
achieving a per share price of $12 per share or greater for the
other half of the award.
About Comstock Mining
Comstock Mining Inc. -- http://www.comstockmining.com-- is a
Nevada-based, precious and strategic metal-based exploration,
economic resource development, mineral production and metal
processing business with a strategic focus on high-value,
cash-generating, environmentally friendly, and economically
enhancing mining and processing technologies and businesses.
Comstock Mining recorded a net loss of $3.81 million for the year
ended Dec. 31, 2019, compared to a net loss of $9.48 million for
the year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company
had $48.17 million in total assets, $12.98 million in total
liabilities, and $35.19 million in total equity.
Deloitte & Touche LLP, in Salt Lake City, Utah, the Company's
auditor since 2011, issued a "going concern" qualification in its
report dated March 30, 2020 citing that the Company has incurred
recurring losses and cash outflows from operations, has an
accumulated deficit and has debt maturing within 12 months from the
issuance date of the financial statements that raise substantial
doubt about its ability to continue as a going concern.
CRACKED EGG: Can't Use Chapter 11 to Stop County's Shutdown Attempt
-------------------------------------------------------------------
Matthew Santoni of Law360 reports that the Allegheny County,
Pennsylvania Health Department can proceed with a lawsuit seeking
to shut down Cracked Egg, a Pittsburgh-area restaurant, for
refusing to follow pandemic precautions, after a federal bankruptcy
judge on Thursday lifted the stay imposed when the restaurant filed
for Chapter 11 protection.
After reciting the state, national and worldwide death tolls of the
COVID-19 pandemic, U.S. Bankruptcy Judge Jeffery Deller's opinion
said the Health Department could pursue its enforcement action
against The Crack'd Egg and its parent company, The Cracked Egg
LLC, for ignoring statewide orders regarding facemasks and indoor
occupancy limits, even though the business filed for bankruptcy.
"The mere fact that a debtor has filed for bankruptcy protection
does not obviate the requirement that a debtor abide by applicable
law," Judge Deller wrote. "The automatic stay in bankruptcy is a
shield and not a sword designed to afford a party with a litigation
advantage. While the automatic stay in bankruptcy is designed to
afford the honest but unfortunate debtor with respite from creditor
collection activities ... the automatic stay does not provide a
debtor in bankruptcy with a carte blanche excuse to avoid health
and safety regulations."
Judge Deller's orders Thursday, January 7, 2021, lifted the
automatic stay on the county's case and remanded it to the
Allegheny County Court of Common Pleas.
The restaurant had allegedly ignored statewide mandates that all
employees wear face coverings and that customers cover their faces
when not eating or drinking, and it had operated at full capacity
despite mitigation orders limiting indoor occupancy to 25% or 50%
of its usual limits. The health department suit, filed in state
court in September, said the county had cited the restaurant
repeatedly and revoked its operating permit, but the owners
remained open anyway.
The Cracked Egg filed a federal counter-suit trying to overturn the
mitigation measures, but also filed for bankruptcy in early October
and brought a halt to all the litigation.
The Cracked Egg's attorney argued Tuesday that the pandemic
mandates the health department sought to enforce were illegal, and
thus the lawsuit was not an enforcement action exempt from the
bankruptcy stay.
But Judge Deller said it was not for the bankruptcy court to decide
whether the state's orders were legal.
"The debtor's defense to the motion is to essentially request that
this court declare the COVID-19 Control Measure Orders
unconstitutional and therefore deny the motion for relief from
automatic stay," he wrote. "The court, however, declines to accept
the debtor's invitation to insert itself into the fray."
Federal law does not require the bankruptcy court to be a
"gatekeeper" that determines whether a police or regulatory action
is legitimate in the first place, Judge Deller said, and even if he
did have the power to weigh the legality of the restrictions, there
were contradicting federal rulings on other mitigation orders. The
other state and federal courts would be able to decide the legality
of those measures as The Cracked Egg's cases moved ahead, he said.
"This court is not undertaking an exhaustive analysis of the
constitutional issues presented by the debtor's challenge to the
COVID-19 control measure orders. The court is merely pointing out
the fact that the debtor's case is hardly the proverbial
'slam-dunk," the judge wrote. "Given the fact that the debtor's
objection... does not lend itself to an obvious ruling in the
debtor's favor, the court's discretion is that it is better to
leave the determination of these issues to the court of competent
jurisdiction that will ultimately preside over this dispute."
James R. Cooney of Robert O. Lampl Law Office, representing the
restaurant, said he didn't agree with the judge's opinion but it
was well reasoned, and the restaurant would still have the
opportunity to argue its opposition to the pandemic orders in the
other courts.
"The bright spot for us is that he did not decide the merits of the
opposition," he told Law360 Thursday.
The Allegheny County Health Department is represented in-house by
Michael A. Parker and Vijya Patel, and by Frances Liebenguth of the
Allegheny County Law Department.
The Cracked Egg is represented by James R. Cooney, Robert O. Lampl,
Sy O. Lampl, Alexander L. Holmquist and Ryan J. Cooney of Robert O.
Lampl Law Office.
The cases are County of Allegheny v. The Cracked Egg LLC, case
number GD-20-9809, in the Court of Common Pleas of Allegheny
County, Pennsylvania; and The Cracked Egg LLC v. The County of
Allegheny et al., case number 2:20-cv-01434 in the U.S. District
Court for the Western District of Pennsylvania.
About The Cracked Egg LLC
The Cracked Egg LLC is family-owned and operated culinary driven
gourmet eatery in Brentwood, Pennsylvania that serves breakfast and
lunch.
Cracked Egg 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 Debtor was estimated to have less than
$50,000 in assets and $100,000 to $500,000 in liabilities.
Robert O Lampl Law Office and BeanCounters Tax and Accounting
Services serve as the Debtor's legal counsel and accountant,
respectively.
CREATIVE REALITIES: Amends Loan Agreement to Extend Conversion Date
-------------------------------------------------------------------
Creative Realities, Inc. entered into an Eleventh Amendment to Loan
and Security Agreement with its subsidiaries and Slipstream
Communications, LLC ("Lender"). Pursuant to the Amendment, the
parties agreed to extend the date on which the Lender's existing
$2,000,000 special loan to the Company (with accrued and unpaid
interest) automatically converts into a new class of senior
preferred stock of the Company, from Dec. 31, 2020 to Jan. 31, 2021
(or upon an earlier event of default).
About Creative Realities
Creative Realities, Inc. -- http://www.cri.com-- is a Minnesota
corporation that provides innovative digital marketing technology
and solutions to retail companies, individual retail brands,
enterprises and organizations throughout the United States and in
certain international markets. The Company has expertise in a
broad range of existing and emerging digital marketing
technologies, as well as the related media management and
distribution software platforms and networks, device management,
product management, customized software service layers, systems,
experiences, workflows, and integrated solutions.
Creative Realities reported net income of $1.04 million for the
year ended Dec. 31, 2019, following a net loss of $10.62 million
for the year ended Dec. 31, 2018. As of Sept. 30, 2020, the
Company had $21.10 million in total assets, $16.92 million in total
liabilities, and $4.18 million in total shareholders' equity.
Creative Realities received a letter from The Nasdaq Stock Market
LLC on April 28, 2020, advising the Company that for 30 consecutive
trading days preceding the date of the Notice, the bid price of the
Company's common stock had closed below the $1.00 per share minimum
required for continued listing on The Nasdaq Capital Market
pursuant to Nasdaq Listing Rule 5550(a)(2). The compliance period
for the Company will expire on Dec. 28, 2020.
CRESTWOOD EQUITY: S&P Rates New Notes 'BB-'
-------------------------------------------
S&P Global Ratings assigned its 'BB-' issue-level rating and '4'
recovery rating to U.S.-based master limited partnership Crestwood
Equity Partners L.P.'s subsidiaries'--Crestwood Midstream Partners
L.P. and Crestwood Midstream Finance Corp.--proposed note
issuance.
The company plans to use the proceeds from the financing primarily
toward repayment of its existing senior notes due in 2023 and any
balance toward payment of outstanding borrowings on the company's
corporate revolving credit facility and related issuance fees and
expenses.
The 'BB-' issue-level rating and '4' recovery rating on the notes
reflect S&P's expectation that lenders would receive average
(30%-50%; rounded estimate: 45%) recovery if a payment default
occurs. The issuer credit rating is unchanged.
CRESTWOOD MIDSTREAM: Moody's Rates New $700MM Unsec. Notes 'B1'
---------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Crestwood
Midstream Partners LP's (CMLP) proposed $700 million senior
unsecured notes due 2029. CMLP is wholly owned by Crestwood Equity
Partners LP. Proceeds from the notes, which are being co-issued by
Crestwood Midstream Finance Corp., are expected to fund a tender
offer for CMLP's 6.25% Senior Notes due 2023. Crestwood and CMLP's
other ratings and Crestwood's negative outlook remain unchanged.
Assignments:
Issuer: Crestwood Midstream Partners LP
Senior Unsecured Notes, Assigned B1 (LGD5)
RATINGS RATIONALE
Crestwood's operating subsidiary, Crestwood Midstream Partners LP's
senior unsecured notes are rated B1, one notch below Crestwood's
Ba3 CFR reflecting their effective subordination to the $1.25
billion senior secured revolving credit facility. Crestwood's
preferred units are rated B2, reflecting their subordination to the
unsecured notes and secured debt. The preferred units receive 100%
equity treatment in our analysis.
Crestwood's Ba3 Corporate Family Rating reflects its basin
diversification, good distribution coverage, and a contract profile
with a high portion of fixed fee and take-or-pay contracts. The
rating also reflects the company's relatively moderate stand-alone
leverage. Crestwood is constrained by its relatively small scale,
the inherent volumetric risks in its gathering and processing
business, customer counterparty risk and the additional debt burden
at its parent, Crestwood Holdings LLC, that is serviced by the
partnership's distributions.
Crestwood's SGL-3 rating reflects Moody's expectation that the
company will have adequate liquidity through early 2022. The
company had $446 million available under its $1.25 billion
revolving credit facility as of September 30, 2020. The revolver
expires in October 2023. Moody's expects Crestwood will be able to
fund its basic cash obligations, including capital spending and
distributions, through operating cash flow and generate free cash
flow in 2022. Financial covenants under the Crestwood credit
facility are EBITDA/Interest of at least 2.5x, net Debt/EBITDA of
not more than 5.5x, and senior secured leverage ratio of not more
than 3.75x. Moody's expects the company to maintain compliance with
these covenants through early 2022. Following completion of the
tender for the notes due in 2023, Crestwood's next debt maturity is
in 2025 when its $500 million senior notes issue comes due.
Holdings' term loan matures in March 2023.
The negative outlook reflects uncertainty around the pace of
recovery in Crestwood's oil-focused basins and the spending plans
of certain of its major counterparties.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be considered for an upgrade if the company is
able to sustain debt to EBITDA below 4x, family leverage (including
Holdings debt) less than 5x and distribution coverage remains above
1.2x. The ratings could be downgraded if leverage increases, with
standalone debt to EBITDA rising above 5x or if there is an
increase in Holdings' debt, or distribution coverage falls below
1x.
Crestwood, a master limited partnership, through its subsidiaries
develops, acquires, owns or controls, and operates primarily
fee-based assets and operations within the energy midstream sector.
Through its ownership in Crestwood, Crestwood Holdings, a private
holding company owned primarily by a fund managed by First Reserve
Corporation, indirectly controls Crestwood.
The principal methodology used in these ratings was Midstream
Energy published in December 2018.
CWGS ENTERPRISES: Moody's Upgrades CFR to B1, Outlook Stable
------------------------------------------------------------
Moody's Investors Service upgraded the ratings of CWGS Enterprises,
LLC, including the Corporate Family rating, which was upgraded to
B1. The outlook is stable.
"The rating action reflects the continuing strength in Camping
World's operating performance as strong RV demand fuels sales of
both new and used vehicles and increasing levels of operating
income," stated Moody's Vice President Charlie O'Shea. "Positive
impact on key credit metrics include debt/EBITDA approaching 3.5
times and interest coverage approaching 4 times, both of which are
well inside the upgrade triggers," continued O'Shea. "Liquidity
remains good, with cash and equivalents of $438 million and
floorplan offset availability of $104 million at Q3 end, and
Moody's expects these favorable trends in operating performance to
continue into 2021."
Upgrades:
Issuer: CWGS Enterprises, LLC
Probability of Default Rating, Upgraded to B1-PD from B2-PD
Corporate Family Rating, Upgraded to B1 from B2
Senior Secured Bank Credit Facility, Upgraded to B1 (LGD3) from B2
(LGD4)
Outlook Actions:
Issuer: CWGS Enterprises, LLC
Outlook, Remains Stable
RATINGS RATIONALE
Camping World's B1 rating considers its improved quantitative
credit profile, industry fundamentals that rebounded quickly from
pandemic-related softness, its leading market position within the
recreational vehicle segment, its flexible business model that
provides multiple sources of revenue, with retail sales, membership
sales, and parts and accessories through its dealership and retail
networks, as well as the risks inherent in its acquisition-based
growth strategy. Liquidity at September 30, 2020 is good with cash
and equivalents of $483 million and floorplan offset of $104
million, with meaningful maturities long-dated.
The stable outlook reflects Moody's view that the company has
flexibility surrounding its mix between new and used vehicles, as
well as the fairly predictable profit streams from Good Sam, and a
variable cost structure that can flex such that it can limit the
potential downside that could result from a potentially lingering
demand "shock."
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if operating performance continues its
positive trend, resulting in debt/EBITDA sustained below 3.5 times
and EBIT/interest being sustained above 4 times, while maintaining
at least good liquidity, and an overall balanced financial strategy
that ensures maintenance of this profile no matter the industry
environment. Ratings could be downgraded if debt/EBITDA increased
to over 4.5 times, or if EBIT/interest dropped below 3 times, if
liquidity were to weaken, or if financial strategy became more
aggressive.
The principal methodology used in these ratings was Retail Industry
published in May 2018.
CWGS Enterprises, LLC operates businesses predominantly involved in
the recreational vehicle industry including: (1) FreedomRoads RV
dealerships, which sells new and used RVs, parts, and services
under the Camping World brand name (2) Membership Services,
including Good Sam, which sells club membership, products, services
and publications to RV owners, and (3) Retail, which includes
Camping World retail stores that provide merchandise and services
to RV users, as well as Gander RV & Outdoors stores. September 2020
LTM revenues were around $5.3 billion.
DIOCESE OF BUFFALO: Seeks to Hire Jones Day as Special Counsel
--------------------------------------------------------------
The Diocese of Buffalo, N.Y. seeks approval from the U.S.
Bankruptcy Court for the Western District of New York to employ
Jones Day as special litigation counsel.
The Debtor needs the firm's legal assistance in a case filed by New
York Attorney General Letitia James in the Supreme Court of the
State of New York. The case is styled The People of the State of
New York, by Letitia James, Attorney General of the State of New
York v. Diocese of Buffalo et al.
The lawsuit seeks injunctive relief for alleged violations of New
York Religious Corporations Law, Not-for-Profit Corporation Law and
Estates, Powers and Trusts Law stemming from the Debtor's handling
of allegations of sexual abuse by clergy.
The standard hourly rates charged by Jones Day are:
Partners $1,025 to $1,250
Associates $500 to $900
Jones Day agreed to discount its standard hourly rates by 10
percent.
John Goetz, Esq., a partner at Jones Day, 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:
John D. Goetz, Esq.
Jones Day
500 Grant Street, Suite 4500
Pittsburgh, PA 15219-2514
Phone: + 1 412 391 3939
Fax: + 1 412 394 7959
About The Diocese of Buffalo N.Y.
The Diocese of Buffalo, N.Y., is home to nearly 600,000 Catholics
over eight counties in Western New York. The territory of the
diocese is co-extensive with the counties of Erie, Niagara,
Genesee, Orleans, Chautauqua, Wyoming, Cattaraugus and Allegany in
New York State, comprising 161 parishes. There are 144 diocesan
priests and 84 religious priests who reside in the Diocese.
The diocese through its central administrative offices (a) provides
operational support to the Catholic parishes, schools and certain
other Catholic entities that operate within the territory of the
Diocese "OCE"; (b) conducts school operations through which it
provides parish schools with financial and educational support; (c)
provides comprehensive risk management services to the OCEs; (d)
administers a lay pension trust and a priest pension trust for the
benefit of certain employees and priests of the OCEs; and (e)
provides administrative support for St. Joseph Investment Fund,
Inc.
Dealing with sexual abuse claims, the Diocese of Buffalo sought
Chapter 11 protection (Bankr. W.D.N.Y. Case No. 20-10322) on Feb.
28, 2020. The diocese was estimated to have $10 million to $50
million in assets and $50 million to $100 million in liabilities as
of the bankruptcy filing.
The Hon. Carl L. Bucki is the case judge.
Bond, Schoeneck & King, PLLC, led by Stephen A. Donato, Esq., is
the diocese's counsel; Connors LLP is its special litigation
counsel; and Phoenix Management Services, LLC is its financial
advisor. Stretto is the claims agent, maintaining the page
https://case.stretto.com/dioceseofbuffalo/docket.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on March 12, 2020. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP and Gleichenhaus, Marchese &
Weishaar, PC.
EAST VILLAGE: Unsec. Creditors to Recover 25% in Liquidating Plan
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East Village Properties LLC, et al., submitted a Second Amended
Joint Plan of Liquidation and a Third Amended Disclosure Statement
on Jan. 8, 2021.
The Debtors own 15 residential apartment buildings located in the
East Village area of New York City located at 27 St. Marks Place,
514 East 12th Street, 223 East 5th Street, 229 East 5th Street, 231
East 5th Street, 233 East 5th Street, 235 East 5th Street, 66 East
7th Street, 253 East 10th Street, 510 East 12th Street, 228 East
6th Street, 325 East 12th Street, 327 East 12th Street, 329 East
12th Street and 334 East 9th Street (collectively, the
"Properties").
The Debtors' Properties are encumbered by five mortgages granted to
EVF1 LLC ("EVF1").
A notice of auction sale of the Properties was published in the New
York Real Estate Journal but did not result in there being any
qualified bidders for the Properties. Therefore, the means of
implementation of the plan were for EVF1 to fund certain sums to
fund the plan and for EVF1 or its nominee or designee to take title
to the Properties in full and final satisfaction of its secured
claim.
The Debtors timely filed a joint plan of reorganization and
disclosure statement for joint plan of reorganization on May 30,
2017; a first amended joint plan of reorganization and first
amended disclosure statement for joint plan of reorganization on
June 23, 2017; and a second amended joint plan of reorganization
and second amended disclosure statement for second amended joint
plan of reorganization on July 5, 2017. The Debtors sought
approval of the second amended disclosure statement for second
amended joint plan of reorganization which was granted by the
Bankruptcy Court by order entered on July 5, 2017. The Debtors
then served the solicitation materials in order to seek
confirmation of the proposed plan. The Debtors subsequently filed
their plan supplement on Aug. 8, 2017 and a third amended joint
plan of reorganization on Oct. 10, 2017. A ballot certification
with respect to the Debtors' second amended plan was filed on Oct.
19, 2017 reflecting that three impaired classes of claims cast
ballots voting to accept the plan and one impaired class of claims
cast ballots voting to reject the plan. The confirmation hearing
for the third amended plan of reorganization was scheduled to
proceed on Aug. 18, 2017. However, the Debtors did not proceed
with confirmation of the third amended plan of reorganization and
the confirmation hearing has been continuously adjourned since Aug.
18, 2017.
A number of intervening factors made confirmation of the third
amended joint plan of reorganization an impossibility. The plan
was to be implemented by EVF1 funding the amount of $13,500,000 in
exchange for EVF1 taking title to the Debtors' Properties. At the
time the Debtors and EVF1 agreed to this funding amount, it was
anticipated that unsecured creditors would receive a substantial
distribution on account of their claims. It was also anticipated
that confirmation and the transfer of title of the Properties to
EVF1 or its nominee or designee would take place in the fall of
2017.
However, in September 2017, the Office of the Attorney General of
the State of New York ("AG") through their Consumer Frauds Bureau
filed proofs of claim4 (the "AG Proofs of Claim") against each of
the Debtors alleging as their basis: "Investigation for fraud,
illegality and deceptive practices" and seeking restitution and
statutory penalties in the amount of $5,000,000, which claims, if
recognized as valid, would result in a substantial dilution of the
unsecured creditor distribution, including tenants at the
Properties, the constituency the AG is charged with protecting.
The investigation referenced in the AG Proofs of Claim was the
investigation of amongst other things, into the acquisition of the
Properties by the Debtors through their former manager, which
acquisition was funded by loans originated by EVF1. EVF1 turned
its focus towards the AG investigation and confirmation of the plan
was put on hold.
The Properties were in severe disarray upon the Debtors' bankruptcy
filing. Although it was under no obligation to do so, EVF1
installed its own management group, Silverstone Property Group LLC
("SPG"), to manage the Properties and funded the carrying costs for
the Properties, including, but not limited to payment of real
estate taxes, building maintenance and repairs and tenant buyouts,
at EVF1's sole cost and expense. Ultimately, SPG's effective
management resolved many the prepetition issues it inherited to the
benefit of all tenants at the Properties.
During this time period while the confirmation hearing was carried
on the Court's calendar, there was a significant change to NYS rent
laws through the enactment of the Housing Stability and Tenant
Protection Act of 2019. This change in law materially impacted the
prospective rent roll at the Properties as 259 of the 279 units are
subject to rent stabilization protections. As a result the
Properties' fair market value decreased. This factor alone made
the prior plan unconfirmable and EVF1 would not be required to
advance any additional funds towards the plan.
Finally, while EVF1 was eventually able to resolve the AG
investigation, which resolution is documented by a settlement
agreement (the "Settlement Agreement") which is being presented to
the Bankruptcy Court for approval pursuant to F.R.B.P. Rule 9019
simultaneous with approval of this disclosure statement, in March
of 2020, as the COVID-19 pandemic overwhelmed New York City's
hospital system, New York Governor Andrew Cuomo signed an executive
order "New York State on Pause", effectively closing all
non-essential businesses as of March 22, 2020 in an effort to
"flatten the curve" and slow the spread of the virus. The
financial impact of the statewide shutdown is not quantifiable at
this juncture, but the value of real estate has further diminished.
As a result of all of these factors, the previously agreed to
plan funding amounts needed to be re-negotiated by the Debtors and
EVF1 if there was to be a viable exit from bankruptcy.
The Third Amended Disclosure Statement and the accompanying
proposed plan of liquidation filed Jan. 8, 2021, are meant to
supersede the prior plans and disclosure statements filed in the
Debtors' Chapter 11 cases and to be the governing documents for the
conclusion of the Chapter 11 Cases.
Plan of Liquidation
According to the Third Amended Disclosure Statement, the Second
Amended Joint Plan of Liquidation will be funded by EVF1 LLC
("EVF1" or "Secured Creditor"). The sum of $3,125,000 will be
funded by EVF17 to: (i) pay, as provided for in accordance with the
terms and conditions set forth in the Plan, the Allowed Claims in
Classes 1, 3 and 6, (which amount is not inclusive of amounts due
for Administrative Claims except as set forth herein, Priority Tax
Claims, Fee Claims and United States Trustee Fees; (ii) to pay the
entire Manager Administrative Claim (as defined hereunder); and
(iii) to pay a pro rata distribution, over time, to Allowed Claims
in Classes 4 and 5 (a portion of which will be paid from the Post
Effective Date Payments upon the sale of the Properties) in
accordance with their relative priorities provided for in the
Bankruptcy Code.
On or before the Effective Date, EVF1 will fund the amount of
$150,000 for the Class 6 AG Claim and $1,487,500 for a portion of
the Administrative Claim of the Debtors' post Commencement Date
Manager (the "Manager Administrative Claim"); and the initial pro
rata distribution, to holders of Allowed General Unsecured Claims
and Allowed Tenant Claims. After the Effective Date, EVF1 will fund
the amount of $1,487,500 ("Post Effective Date Payments"), for the
remaining pro rata distribution to Allowed Tenant Claims and
Allowed General Unsecured Claims and the Manager Administrative
Claim.
All such Post Effective Date Payments will be paid from
distributions from the sale of each of the Properties in an amount
no greater than $250,000 per sale, or, if no sales have occurred,
or amounts remain unpaid, by EVF1, from the Post Effective Date
Payments, no later than July 1, 2022, provided, however, if there
are additional Allowed Claims for General Unsecured Claims and
Tenant Claims (other than the Allowed Claims for General Unsecured
Claims and Tenant Claims as of the Effective Date) after the
Effective Date, EVF1 will fund, if necessary, up to an additional
sum of no greater than $125,000 (the "Disputed Claim Reserve"), if
the $3,125,000 is depleted, to pay no greater than 25% of such
claims, so that total payments to Allowed General Unsecured Claims,
Allowed Tenant Claims and the Manager Administrative Claim, which
shall be treated on a pari passu basis, will not exceed $3,100,000
and once total payments to Allowed General Unsecured Claims,
Allowed Tenant Claims and the Manager Administrator Claim, reach
$3,100,000, there will not be any further distributions and funding
obligations from EVF 1 on account of such claims, regardless of
whether the foregoing payments have been totally made. After
confirmation, EVF1 will be responsible to fund the Disputed Claim
Reserve for distributions required to be made towards payment of
25% of Disputed Claims up to the amount of $125,000 (once the
claims become Allowed Claims) and to make any other post Effective
Date payments required under the Plan, limited to payments for
Administrative Claims (not including the Manager Administrator
Claim which will be paid solely from the $3,125,000) Priority Tax
Claims, Fee Claims and United States Trustee Fees (collectively,
with the $3,125,000, the "Plan Fund"). In addition, EVF1 will
receive the Debtors' Cash Collateral as of the Effective Date of
the Plan.
Under the Plan, all creditors holding Allowed Claims (except for
General Unsecured Creditors and Tenant Claims who will receive
their initial distribution on the Effective Date) will be paid in
accordance with the priorities provided for under the Bankruptcy
Code and on the Effective Date.
The Properties and remaining Cash Collateral held by the Debtors'
Estates as of the Effective Date are the only distributions to be
made to EVF1 on account of the EVF1 Secured Claim in full and final
satisfaction of the EVF1Secured Claim, regardless of whether EVF1
or its nominee or designee elects to take title to the Properties
subject to the existing EVF1 Mortgages.
Class 4 General Unsecured Claims owed $8.157 million to $8.288
million are projected to recover 25% under the Plan, subject to
resolution of pending claims objections.
A full-text copy of the Third Amended Disclosure Statement as
further modified on Jan. 8, 2021, is available at
https://bit.ly/3i1zOmd from PacerMonitor.com at no charge.
Attorneys for the Debtors:
A. Mitchell Greene, Esq.
Fred B. Ringel
Lori Schwartz
ROBINSON BROG LEINWAND
GREENE GENOVESE & GLUCK P.C.
875 Third Avenue
New York, New York 10022
Tel. No.: 212-603-6300
About East Village Properties
East Village Properties, LLC, and its affiliates own 15 residential
apartment buildings located in the East Village area of New York
City.
East Village Properties, LLC, and affiliates sought Chapter 11
protection (Bankr. S.D.N.Y. Case No. 17-22453) on March 28, 2017.
In the petition signed by David Goldwasser, authorized signatory of
GC Realty Advisors LLC, manager, the Debtor was estimated to have
assets and liabilities in the range of $0 to $50,000. Judge Robert
D. Drain is assigned to the case. The Debtors tapped Arnold
Mitchell Greene, Esq., at Robinson Brog Leinwand Greene Genovese &
Gluck, P.C., as counsel.
FECK PROPERTIES: Court Confirms Sale Plan
-----------------------------------------
Judge Caryl E. Delano has entered an order confirming the Plan of
Feck Properties, LLC, pursuant to Sections 1129 and 1191(b) of the
Bankruptcy Code.
All objections to the Plan are overruled in all respects.
The Ballot Tabulation as filed on Nov. 16, 2020, reflects that:
Classes 1 and 6 are unimpaired and therefore deemed to have
accepted the Plan; Classes 2 and 4 are impaired but affirmatively
voted for the Plan; Class 3 is impaired and voted to reject the
Plan; and Class 5 is impaired and did not vote to accept or reject
the Plan. Therefore, the Ballot Tabulation reflects the acceptance
by creditors of two Classes.
The Plan satisfies all of the requirements of Section 1129(b) of
the Bankruptcy Code. The Court specifically finds that the Plan
does not discriminate unfairly and is fair and equitable, with
respect to each class of claims or interests that is impaired
under, and has not accepted, the Plan.
In open court at the Confirmation Hearing, counsel for the Debtor
accepted the Court's suggestion that the first payment to Ms.
Hollis should be made on Jan. 1, 2021, which suggestion is hereby
incorporated into the Plan. The claim of Gina Hollis will be
treated as allowed in the principal amount of $2,058,999 only for
the purpose of calculating the monthly adequate protection
payments.
The Court will conduct a post-confirmation status conference in the
Chapter 11 case on Jan. 25, 2021 at 2:00 p.m. EST. Effective March
16, 2020, and continuing until further notice, Judges in all
Divisions will conduct all preliminary and non-evidentiary hearings
by telephone. For Judge Delano parties should arrange a telephonic
appearance through Court Call (866-582-6878).
Under the Plan, Class 5 General Unsecured Creditors, excluding
insiders, will be paid, up to the full allowed amount from:
cash-flow of the Company after payment in full of the claims in
Classes 1,2, 3, and 4; and the net proceeds of the sale of the MA
Property, and/or the FL Property. This class is impaired and
entitled to vote on the Plan. Insiders will not be paid until or
unless all other allowed claims are paid in full. According to the
liquidation analysis, unsecured creditors will recover 100% under
the Plan, compared with just 20% in a Chapter 7 liquidation.
A copy of the Third-Amended Plan is available at
https://bit.ly/3qbApo7
About Feck Properties
Feck Properties is primarily engaged in real estate rentals
business in Florida and real estate development and sales business
in Massachusetts.
Feck Properties filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
20-05209) on July 7, 2020. In the petition signed by Stanley B.
Feck, manager, Debtor disclosed $4,750,000 in assets and $2,773,630
in liabilities. Kevin Christopher Gleason, Esq., at Florida
Bankruptcy Group, LLC represents Debtor as legal counsel.
FERRELLGAS PARTNERS: Removes Interim Tag from CEO Ferrell's Title
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Ferrellgas, Inc., the general partner of Ferrellgas Partners, L.P.
and Ferrellgas, L.P., and James E. Ferrell entered into (i) an
offer letter, effective as of Dec. 30, 2020, and (ii) an Employment
Agreement and an Executive Confidentiality and Restrictive
Covenants Agreement, both effective as of Dec. 31, 2020
("Commencement Date"), pursuant to which Mr. Ferrell will serve as
president and chief executive officer of the General Partner
beginning on the Commencement Date, transitioning from his current
title of interim president and chief executive officer, which
interim title he has held since Sept. 27, 2016. Mr. Ferrell will
continue to serve as the principal executive officer for purposes
of the Securities Exchange Act of 1934, as amended.
Pursuant to the Offer Letter, Mr. Ferrell will report to the board
of directors of the General Partner. As compensation for Mr.
Ferrell's services he will: (i) be paid an annual base salary of
$900,000, (ii) receive a sign-on bonus of $2,000,000, (iii) be
eligible to participate in the General Partner's Short Term
Incentive Plan, and (iv) be eligible for medical, dental and
visions benefits provided by the General Partner. Consistent with
the terms of the Offer Letter, the Employment Agreement further
provides that Mr. Ferrell will be included, to the extent eligible
under the terms and conditions, in all of the General Partner's
plans providing benefits for its employees.
Pursuant to the terms of the Employment Agreement, Mr. Ferrell will
serve as president and chief executive officer for a period
beginning on the Commencement Date and continuing for two years,
unless earlier terminated by Mr. Ferrell or the General Partner as
provided for in the Employment Agreement, with the Employment
Agreement automatically terminating on Dec. 31, 2022, unless either
party provides no less than 90-days advance written notice prior to
expiration. Mr. Ferrell will be entitled to receive the base
salary, short-term incentive plan participation and eligibility for
medical, dental and vision benefits as described in the Offer
Letter, as well as certain severance benefits based on the nature
of his termination. Upon termination for Cause (as defined in the
Employment Agreement), or upon resignation without Good Reason (as
defined in the Employment Agreement), death or disability, Mr.
Ferrell will be entitled to receive: (i) all accrued unpaid base
salary through the date of termination; (ii) all accrued but unused
vacation days; and (iii) any properly documented reimbursable
business expenses.
If Mr. Ferrell's employment is terminated by the General Partner
without Cause or if Mr. Ferrell parts with the General Partner for
Good Reason, Mr. Ferrell will be entitled to receive: (i) the
Accrued Obligations; (ii) a lump sum payment of any amounts
remaining under the Employment Agreement; and (iii) subject to Mr.
Ferrell's election of and qualification for continuation coverage,
for a period of 12 consecutive months following termination of
employment, premium costs for certain insurance benefits in the
monthly amount the General Partner was paying toward Mr. Ferrell's
General Partner-provided group health plan insurance coverage
immediately prior to his cessation of employment.
The Employment Agreement also requires that Mr. Ferrell enter into
the Confidentiality and Restrictive Covenants Agreement, pursuant
to which Mr. Ferrell covenants not to compete with the General
Partner or any of its subsidiaries and affiliates, or solicit
members of senior leadership or business partners, during his
employment and for five years thereafter. The Confidentiality and
Restrictive Covenants Agreement also contains customary
confidentiality and non-disclosure covenants.
On Dec. 30, 2020, the Compensation Committee of the Board of
Directors of the General Partner awarded Mr. Ferrell a one-time
bonus of $1,500,000, less applicable withholdings, in his capacity
as interim chief executive officer and president, for his effort in
executing the operational turnaround of the business and overseeing
the execution of the Transaction Support Agreement entered into on
Dec. 10, 2020 by the General Partner and certain of its
affiliates.
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.
Ferrellgas reported a net loss of $64.54 million for the year ended
July 31, 2019, compared to a net loss of $256.82 million for the
year ended July 31, 2018. As of Oct. 31, 2020, the Company had
$1.65 billion in total assets, $1.12 billion in total current
liabilities, $1.64 billion in long-term debt, $83.34 million in
operating lease liabilities, $49.54 million in other liabilities,
and a total partners' deficit of $1.24 billion.
* * *
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.
FIRST FLORIDA: Wants Solicitation Exclusivity Extended Thru March 1
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First Florida Living Options LLC requests the U.S. Bankruptcy Court
for the Middle District of Florida, Jacksonville Division to extend
the exclusive periods during which the Debtor may solicit
acceptances for the plan through and including March 1, 2021.
The Debtor said that cause exists in that the Debtor, the
purchaser, and counsel for principal creditors, Melvin and Marian
Kunz, are in the process of finalizing the proposed Order Approving
the Sale and the Debtor anticipates that the Sale Order will be
submitted to the Court for consideration shortly. The sale of the
Debtor's business is the most significant event in this case and
the cornerstone of the Debtor's Chapter 11 Plan.
Moreover, the Debtor and its largest creditor, the Estate of
Shirley A. Yandle, have settled their dispute. On November 12,
2020, the Debtor filed a Motion to Approve Compromise of the Yandle
Claim on negative notice. The deadline for parties to respond to
the Compromise Motion is December 7, 2020. If approved, a
$10,000,000 claim will be reduced to $175,000 and payment of the
settlement amount will be made by the Debtor's parent corporation,
or Florida Living Options, Inc.
Finally, the Debtor and Kunz, participated in a mediation
conference and have also come to an agreement settling their
disputes. The Debtor and Kunz are finalizing the Mediated
Settlement Agreement and the Debtor anticipates that it will be
filing a Motion to Approve the Settlement Agreement shortly.
Given the circumstances and the pending sale, as well as the
pending settlement agreements, the Debtor asserts there is
sufficient cause to grant their request for an extension. The
Debtor's request is not submitted for purposes of delay and will
not prejudice any party.
A copy of the Debtor's Motion to extend is available from
PacerMonitor.com at https://bit.ly/3hY2nkv at no extra charge.
About First Florida Living Options
First Florida Living Options LLC, formerly known as Surrey Place of
Ocala, conducts its business under the names Hawthorne Health and
Rehab of Ocala, Hawthorne Village of Ocala, and Hawthorne Inn of
Ocala. The company is based in Ocala, Fla.
First Florida Living Options filed a Chapter 11 petition (Bankr.
M.D. Fla. Case No. 19-02764) on July 22, 2019. The petition was
signed by John M. Crock, vice president. The Debtor estimated $1
million to $10 million in both assets and liabilities as of the
bankruptcy filing.
Judge Jerry A. Funk oversees the case. Johnson Pope Bokor Ruppel &
Burns, LLP and Shawn Harrison Associates, PLLC serve as the
Debtor's bankruptcy counsel and special counsel, respectively.
Michael Phillips has been appointed as patient care ombudsman.
FORUM ENERGY: Divests ABZ, Quadrant Valve Brands
------------------------------------------------
Forum Energy Technologies, Inc. has completed the sale of assets
associated with its ABZ and Quadrant valve brands to Anvil and
Smith-Cooper International. Total consideration for the
transaction was $105 million in cash. As part of the transaction,
Anvil and Smith-Cooper will employ the ABZ and Quadrant employees
primarily located at the operations located in Madison, Kansas and
Broussard, Louisiana.
Cris Gaut, Forum's chairman and chief executive officer, commented,
"This important transaction significantly improves our liquidity
and financial flexibility, and continues the improvements made to
Forum's capital structure during 2020. Pro-forma for the sale
proceeds, our net debt would be reduced by over one-third from the
$308 million level at September 30, 2020. In 2021 we will remain
focused on further improving our financial position and continuing
quarterly positive free cash flow.
I am enthusiastic about Forum's strategic positioning and future
for a number of reasons:
* Our cash balance equates to more than 150% of our equity
market
capitalization;
* The further cost reduction measures we announced in our third
quarter 2020 earnings call will improve our profitability and
further enhance our earnings leverage as revenue grows;
* We expect our revenues to remain highly correlated with the
recovering level of drilling and completion activity; and
* Our balance sheet, with significant cash on hand, a virtually
undrawn credit facility that matures in late 2022 and
convertible notes maturing in 2025, positions Forum to thrive
in this opportunity-rich market environment.
In 2020, the ABZ and Quadrant product families generated revenues
of approximately $42 million and made an EBITDA contribution of
approximately $12 million. In each of 2018 and 2019, ABZ and
Quadrant represented approximately 15% of the Adjusted EBITDA
contribution from all Forum product lines, before corporate costs.
This divestiture increases Forum's focus on the growing level of
drilling and completion activity, with the U.S. drilling rig count
up by over 40% since August 2020.
"The teams at ABZ and Quadrant have been a part of the Forum family
since 2010 and we are grateful for their contribution over these
many years. These brands will prove complementary to Anvil and
Smith-Cooper International and we believe the ABZ and Quadrant
employees will see new and expanding opportunities as a result."
Anvil and Smith-Cooper International is a global provider of
high-quality pipe connection, support system, fire protection,
fabrication, and flow control products and services to the
commercial, industrial, manufacturing, oil and gas, and power
generation industries. The Company's portfolio of brands includes
AFCON®, Anvil, Anvil EPS, Basic-PSA, Beck, Catawissa, Cooplok,
Cooplet, FlexHead, FPPI, Gruvlok, J.B. Smith, Merit, Megawatt,
North Alabama Pipe, SCI, Sharpe, SPF, and SprinkFLEX. Anvil and
Smith-Cooper International has headquarters in Commerce, CA, and
Exeter, NH, with manufacturing and distribution locations
strategically located throughout North America.
About Forum Energy
Forum Energy Technologies is a global oilfield products company,
serving the drilling, downhole, subsea, completions and production
sectors of the oil and natural gas industry. The Company's
products include highly engineered capital equipment as well as
products that are consumed in the drilling, well construction,
production and transportation of oil and natural gas. Forum is
headquartered in Houston, TX with manufacturing and distribution
facilities strategically located around the globe. For more
information, please visit www.f-e-t.com
Forum Energy reported a net loss of $567.06 million for the year
ended Dec. 31, 2019, compared to a net loss of $374.08 million for
the year ended Dec. 31, 2018. As of Sept. 20, 2020, the Company
had $924.02 million in total assets, $496.74 million in total
liabilities, and $427.28 million in total equity.
* * *
As reported by the TCR on Aug. 21, 2020, S&P Global Ratings raised
its issuer credit rating on Houston-based oilfield products and
services provider, Forum Energy Technologies Inc., to 'CCC+' from
'SD' (selective default) after the company completed its debt
exchange for the majority of its 6.25% senior unsecured notes due
2021.
Also in August 2020, Moody's Investors Service upgraded Forum
Energy Technologies, Inc.'s Corporate Family Rating to Caa2 from
Ca. "The upgrade of Forum's ratings reflects the extended debt
maturity profile and resulting improvement in liquidity," said
Jonathan Teitel, a Moody's analyst.
FRANCESCA'S HOLDINGS: TerraMar Named Stalking Horse Bidder
----------------------------------------------------------
Francesca's Holdings Corporation on Jan. 8, 2020, announced that
the U.S. Bankruptcy Court for the District of Delaware has
authorized francesca's to conduct an auction process for the
Company. The auction process is designed to achieve the highest
and best offer for the Company's assets and would be conducted
under the Court's supervision and in accordance with the U.S.
Bankruptcy Code.
The Company previously entered into a Letter of Intent with
TerraMar Capital, LLC, an investment firm that provides debt and
equity capital to middle-market businesses, for TerraMar or an
affiliate to become the stalking horse bidder for the auction and
sale process. On Jan. 8, the Company announced the execution of
the stalking horse Asset Purchase Agreement (the "Stalking Horse
APA") with TerraMar's affiliate, Francesca's Acquisition, LLC, and
with Tiger Capital Group, LLC (collectively, the "Buyers"). The
Stalking Horse APA sets the minimum acceptable bid at the auction
and will be subject to higher or better offers.
Under the terms of the Stalking Horse APA, the Buyers have agreed
to purchase substantially all of the assets of the Company and its
subsidiaries for approximately $17 million of cash, subject to
certain adjustments, plus the assumption of substantial
liabilities. The transaction is subject to the approval of the
Bankruptcy Court and the satisfaction of customary closing
conditions. It is also subject to higher or better offers in
accordance with the bid procedures previously approved by the
Bankruptcy Court, which require other bids to be submitted by Jan.
13, 2021.
"We are pleased to announce the signing of a Stalking Horse
Agreement with the Buyers and that the court has authorized us to
proceed with the bid, auction and sale process. We are excited to
partner with TerraMar, keeping us on track to position francesca's
(R) for long-term success," said Andrew Clarke, Chief Executive
Officer of francesca's (R).
"We are very excited to have reached an agreement with francesca's
(R) and are enthusiastic for the strength of the brand and the
future prospects for the business," said Joshua Phillips, Managing
Partner of TerraMar Capital.
* * *
According to Bloomberg News, TerraMar had previously submitted a
letter of intent to buy Francesca's, but the Debtor was negotiating
with other potential bidders in recent weeks. Francesca's
stalking horse purchase agreement with a TerraMar affiliate calls
for a $17 million cash purchase price, subject to certain
adjustments, along with more than $6.6 million in assumed
liabilities.
About Francesca's Holdings
Francesca's Holdings Corporation is a specialty retailer that
operates a nationwide-chain of boutiques providing a diverse
assortment of apparel, jewelry, accessories and gifts. As of Dec.
1, 2020, Francesca's operated 558 boutiques in 45 states and the
District of Columbia, and also serves customers through
www.francescas.com, its e-commerce website, and its recently
launched mobile app.
Francesca's Holdings and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No.
20-13076) on Dec. 3, 2020. Francesca's Holdings had total assets
of $264.7 million and total liabilities of $290.5 million as of
Nov. 1, 2020.
Judge Brendan Linehan Shannon oversees the cases.
The Debtors tapped O'Melveny & Myers LLP and Richards, Layton &
Finger P.A. as legal counsel, FTI Capital Advisors LLC as financial
advisor and investment banker, and A&G Realty Partners as real
estate advisor. Bankruptcy Management Solutions Inc. is the
notice, claims and balloting agent.
Buyers TerraMar Capital, LLC, and Francesca's Acquisition, LLC,
have retained the services of McDonald Hopkins LLC and Young
Conaway Stargatt & Taylor, LLP as counsel.
GALAXY NEXT: Tysadco to Buy Up to $10M Worth of Common Stock
------------------------------------------------------------
Galaxy Next Generation, Inc. and Tysadco Partners LLC entered into
an Amended and Restated Purchase Agreement between the Company and
the Investor, which amends and restates the Purchase Agreement
entered into with the Investor on May 31, 2020, as amended on July
9, 2020 between the Company and the Investor. Also, on Dec. 29,
2020, the Company executed a Registration Rights Agreement, and a
Securities Purchase Agreement with the Investor.
Pursuant to the Amended Purchase Agreement, the Investor committed
to purchase, subject to certain restrictions and conditions, up to
$10.0 million worth of the Company's common stock over a period of
24 months from the effectiveness of the registration statement
registering the resale of shares purchased by the Investor pursuant
to the Amended Purchase Agreement. The Company has issued 50.0
million shares of its common stock to the Investor as a commitment
fee.
The Amended Purchase Agreement provides that at any time after the
effective date of the Registration Statement, from time to time on
any business day selected by the Company, the Company shall have
the right, but not the obligation, to direct the Investor to buy
the lesser of 500,000 shares of its common stock per sale or 300%
of the average shares traded for the 10 days prior to the closing
request date, at a purchase price of 85% of the lowest average
daily traded price during the ten trading days commencing on the
first trading day following delivery and clearing of the delivered
shares, with a minimum request of $200,000. The payment for the
shares covered by each request notice will occur on the business
day the Investor receives the trade settlement for the purchased
shares.
In addition, the Investor will not be obligated to purchase shares
if the Investor's total number of shares beneficially held at that
time would exceed 9.99% of the number of shares of the Company's
common stock as determined in accordance with Rule 13d-3 of the
Securities Exchange Act of 1934, as amended. In addition, the
Company is not permitted to draw on the facility unless there is an
effective registration statement to cover the resale of the
shares.
The Amended Purchase Agreement also contains customary
representations and warranties of each of the parties. The
assertions embodied in those representations and warranties were
made for purposes of the Amended Purchase Agreement and are subject
to qualifications and limitations agreed to by the parties in
connection with negotiating the terms of the Amended Purchase
Agreement. The Amended Purchase Agreement further provides that
the Company and the Investor are each entitled to customary
indemnification from the other for, among other things, any losses
or liabilities they may suffer as a result of any breach by the
other party of any provisions of the Amended Purchase Agreement or
Registration Rights Agreement.
The Company has the unconditional right, at any time, for any
reason and without any payment or liability, to terminate the
Amended Purchase Agreement following the Commencement Date (as
defined therein). In addition, the Amended Purchase Agreement
automatically terminates upon certain bankruptcy events, if the
commencement of Investor's purchase of shares thereunder shall not
have occurred on or before March 31, 2021, or if the Company sells
the entire $10.0 million of shares of common stock subject to the
Amended Purchase Agreement.
Pursuant to the terms of the Registration Rights Agreement, the
Company is obligated to file a registration statement with the SEC
within 30 days after entering into the Amended Purchase Agreement
to register the shares issuable under the Amended Purchase
Agreement and the Commitment Shares.
Pursuant to the terms and conditions of the SPA, the Company sold
and the Investor purchased 100 million shares of the Company's
common stock for an aggregate purchase price of $500,000.
About Galaxy Next Generation
Headquartered in Toccoa, Georgia, Galaxy Next Generation, Inc. --
http://www.galaxynext.us-- is a manufacturer and distributor of
interactive learning technologies and enhanced audio solutions. It
develops both hardware and software that allows the presenter and
participant to engage in a fully collaborative instructional
environment.
Galaxy Next reported a net loss of $14.03 million for the year
ended June 30, 2020, compared to a net loss of $6.66 million for
the year ended June 30, 2019. As of Sept. 30, 2020, the Company
had $5.21 million in total assets, $11.34 million in total
liabilities, and a total stockholders' deficit of $6.13 million.
Somerset CPAs PC, in Indianapolis, Indiana, the Company's auditor
since 2018, issued a "going concern" qualification in its report
dated Sept. 28, 2020, citing that the Company has suffered
recurring losses from operations and has a net capital deficiency
that raise substantial doubt about its ability to continue as a
going concern.
GARRETT MOTION: Equity Holders Should Shoulder Fees, Creditors Say
------------------------------------------------------------------
Law360 reports that the unsecured creditors of Garrett Motion Inc.
on Jan. 6, 2021, asked a New York bankruptcy judge to reject an
equity holder request that the debtor pay $2.5 million to potential
investors, saying the shareholders should cover any investor
incentives.
In a motion filed Wednesday, Jan. 6, 2021, the unsecured creditors
committee said the request from the equity holders committee to pay
the fees and expenses of a pair of investors with equity funding
proposals was an attempt by the shareholders to get Garrett Motion
to underwrite an attempt to boost what they will recover from the
bankruptcy.
About Garrett Motion Inc.
Based in Switzerland, Garrett Motion Inc. (NYSE: GTX) designs,
manufactures and sells highly engineered turbocharger and
electric-boosting technologies for light and commercial vehicle
original equipment manufacturers ("OEMs") and the global vehicle
and independent aftermarket.
Garrett Motion and its affiliates sought Chapter 11 protection
(Bankr. S.D.N.Y. Lead Case No. 20-12212) on Sept. 20, 2020.
Garrett disclosed $2,066,000,000 in assets and $4,169,000,000 in
liabilities as of June 30, 2020.
The Debtors tapped SULLIVAN & CROMWELL LLP as counsel; QUINN
EMANUEL URQUHART & SULLIVAN LLP as co-counsel; PERELLA WEINBERG
PARTNERS as investment banker; MORGAN STANLEY & CO. LLC as
investment banker; and ALIXPARTNERS LLP as restructuring advisor.
KURTZMAN CARSON CONSULTANTS LLC is the claims agent.
GASTON ENTERPRISES: Gets OK to Hire RP Valuation as Appraiser
-------------------------------------------------------------
Gaston Enterprises, LLC received approval from the U.S. Bankruptcy
Court for the District of Arizona to hire Scottsdale, Ariz.-based
appraiser, RP Valuation Group LLC.
The Debtor needs the firm to appraise its commercial real
properties located at 23630 N. 35th Drive and 23640 N. 35th Drive,
Glendale, Ariz.
RP Valuation will be paid the amount of $4,500 to prepare an
appraisal report. In addition, the firm will charge between $250
and $325 per hour for time spent attending conferences and meetings
and for testifying in depositions or trial.
The Debtor will provide the appraiser with a retainer in the amount
of $4,500.
Dan Paulus of RP Valuation disclosed in court filings that his firm
is disinterested as that term is defined in Section 101(14) of the
Bankruptcy Code. .
The firm can be reached through:
Dan A. Paulus, MAI
Catherine N. Zeibig, MAI
RP Valuation Group LLC
4835 E Cactus Rd Ste. 320
Scottsdale, AZ 85254
Phone: +1 480-212-7631
About Systems Integrators LLC
Systems Integrators, LLC is a privately owned and operated
manufacturing company that offers custom gasket manufacturing, a
full-service CNC machine shop, machine vision systems or part
inspection equipment, fatigue testing equipment, concentration
analyzers, flow meters, electronic assembly and repair.
Systems Integrators filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No.
20-12056) on Nov. 2, 2020. Samuel M. Gaston, managing member,
signed the petition. At the time of the filing, the Debtor
estimated $1 million to $10 million in both assets and
liabilities.
Judge Eddward P. Ballinger Jr. oversees the case.
Randy Nussbaum, Esq., at Sacks Tierney P.A., represents the Debtor
as counsel.
GATEWAY RADIOLOGY: 11th Cir. Rules Debtors Can't Receive PPP Loans
------------------------------------------------------------------
W. Glenn Jensen of Roetzel & Andress wrote an article on JDSupra
titled "The Eleventh Circuit Decides That Chapter 11 Debtors In
Possession Cannot Receive Loans Under The Paycheck Protection
Program ("PPP")."
As many property owners and business operators continue to face the
economic malaise associated with government shutdown orders, a
decline in foot traffic in many of the traditional brick and mortar
businesses, and a slow roll out of the COVID-19 vaccines, a recent
decision that is binding in all of the bankruptcy courts in
Florida, Alabama and Georgia has decided that debtors in those
states cannot obtain PPP loans.
Bankruptcy courts have been split on whether a debtor is qualified
to obtain a Small Business Administration ("SBA") PPP loan that
could be forgiven provided certain conditions are met by the
debtor. However, the Eleventh Circuit In re Gateway Radiology
Consultants, P.A., has now thrown away the proverbial "life raft"
to debtors in bankruptcy by deciding that the SBA did not act
improperly by its rule making authority or violate the CARES act
when the SBA decided that debtors do not qualify for loans under
the PPP program. The SBA excluded companies in bankruptcy from
getting PPP loans because they would present an unacceptably high
risk for unauthorized use of funds or non-repayment of unforgiven
loans.
As a result of this decision, many of the business that relied on
PPP loans as part of a restructuring effort in bankruptcy are now
limited in their efforts to obtain a successful reorganization.
Equally important, Congress could have fixed this problem in
passing the most recent $900 billion stimulus package that was
signed by President Trump on December 27th. However, the
Congressional "grinch" did not fix this problem when it allocated
billions of dollars in new PPP monies to borrowers. As a result,
many businesses will likely just close their doors rather than file
for Chapter 11 bankruptcy and hand the lender the keys to the
business. This could trigger a tsunami of guaranty litigation if
the banks decide to pursue the guaranties on the debt owed.
GENESIS PLACE: Jan. 19 Hearing on Disclosure Statement
------------------------------------------------------
Judge Jimmy L. Croom has entered an order that the hearing to
consider the approval of the Disclosure Statement of Genesis Place,
LLC will be held on Jan. 19, 2021, at 10:00 a.m., by Telephone, if
necessary.
Objections to the disclosure statement can be filed at any time
prior to the actual approval of the disclosure statement.
About Genesis Place
Genesis Place, LLC classifies its business as single asset real
estate (as defined in 11 U.S.C. Section 101(51B)).
Genesis Place sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. W.D. Tenn. Case No. 20-24485) on Sept. 15, 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
David S. Kennedy oversees the case. The Debtor tapped Glanker
Brown, PLLC as legal counsel and Valbridge Property Advisors as
valuation consultant and expert appraiser.
GENESIS PLACE: Unsecureds Get Monthly Payments Until Paid in Full
-----------------------------------------------------------------
Genesis Place, LLC, submitted a Plan and a Disclosure Statement.
The Debtor's principal asset consists of a multi-family apartment
complex located at 3007 Getwell Road, Memphis, Tennessee known as
Genesis Place Apartments.
Class 8 Prepetition General Unsecured Non-Priority Non-Insider
Claims are impaired. Class 8 claims aggregate approximately
$270,626. Allowed Class 8 will receive pro rata monthly
distributions commencing 30 days following the Effective Date in
the amount of $7,518 per month until such claims have been paid in
full.
On the Effective Date, the Debtor will continue to operate its
business of operating the Genesis Place apartment complex.
A full-text copy of the Disclosure Statement dated December 14,
2020, is available at https://bit.ly/3rh6BrL from PacerMonitor.com
at no charge.
Attorneys for Genesis Place:
Michael P. Coury
Ricky L. Hutchens
GLANKLER BROWN, PLLC
6000 Poplar Avenue
Suite 400
Memphis, TN 38119
Tel: (901) 576-1886
Fax: (901) 525-2389
E-mail: mcoury@glankler.com
About Genesis Place
Genesis Place, LLC, classifies its business as single asset real
estate (as defined in 11 U.S.C. Section 101(51B)).
Genesis Place sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. W.D. Tenn. Case No. 20-24485) on Sept. 15, 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
David S. Kennedy oversees the case. The Debtor tapped Glanker
Brown, PLLC as legal counsel and Valbridge Property Advisors as
valuation consultant and expert appraiser.
GI DYNAMICS: Inks Third Amendment to Preferred Stock Purchase Deal
------------------------------------------------------------------
Effective as of Dec. 22, 2020, GI Dynamics, Inc. entered into a
Third Amendment to the Series A Preferred Stock Purchase Agreement,
by and between the Company and Crystal Amber Fund Limited, as the
purchaser, pursuant to which the Company and Crystal Amber agreed
to further extend the final closing date of the offering of Series
A Preferred Stock from Dec. 22, 2020 to Jan. 29, 2021.
About GI Dynamics
Founded in 2003 and headquartered in Boston, Massachusetts, GI
Dynamics, Inc. (ASX:GID) is a developer of EndoBarrier, an
endoscopically-delivered medical device for the treatment of type 2
diabetes and the reduction of obesity. EndoBarrier is not approved
for sale and is limited by federal law to investigational use only.
EndoBarrier is subject to an Investigational Device Exemption by
the FDA in the United States and is entering concurrent pivotal
trials in the United States and India.
GI Dynamics reported a net loss of $17.33 million for the year
ended Dec. 31, 2019, compared to a net loss of $8.04 million for
the year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company
had $6.45 million in total assets, $4.88 million in total
liabilities, $5.32 million in redeemable preferred stock, and a
total stockholders' deficit of $3.76 million.
Wolf and Company, P.C., in Boston, Massachusetts, the Company's
auditor since 2019, issued a "going concern" qualification in its
report dated March 26, 2020 citing that the Company has suffered
losses from operations since inception and has an accumulated
deficit and working capital deficiency that raise substantial doubt
about the Company's ability to continue as a going concern.
GIRARDI KEESE: 2 Lawyers Accused of Covering Up Settlement Theft
----------------------------------------------------------------
Law360 reports that the two former Girardi Keese attorneys should
be held in contempt, Edelson PC attorneys told an Illinois federal
judge in the second week of December 2020, saying the pair engaged
in a cover-up that allowed name partner Tom Girardi to allegedly
steal $2 million in settlement funds meant for widows and orphans
of plane crash victims.
David Lira and Keith Griffin, former partners at the now-insolvent
law firm, worked closely with Tom Girardi and knew that the
celebrity attorney hadn't fulfilled a court order by U.S. District
Judge Thomas Durkin to make sure Boeing Co.'s settlements were paid
to a number of Indonesian families whose relatives died.
About Girardi & Keese
Girardi and Keese or Girardi & Keese was a Los Angeles-based law
firm founded in 1965 by lawyers Thomas Girardi and Robert Keese.
It served clients in California in a variety of legal areas. It
was known for representing plaintiffs against major corporations.
An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No.
20-21022) was filed in December 2020 against GIRARDI KEESE by
alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian,
Erika Saldana, Virginia Antonio, and Kimberly Archie.
The petitioners' attorneys:
Andrew Goodman
Goodman Law Offices, Apc
Tel: 818-802-5044
E-mail: agoodman@andyglaw.com
Elissa D. Miller, a member of the firm SulmeyerKupetz, has been
appointed as Chapter 7 trustee.
The Chapter 7 trustee can be reached at:
Elissa D. Miller
333 South Grand Ave., Suite 3400
Los Angeles, California 90071-1406
Telephone: 213.626.2311
Facsimile: 213.629.4520
E-mail: emiller@sulmeyerlaw.com
GLOBAL HEALTHCARE: Appoints Clifford Neuman as Secretary
--------------------------------------------------------
Global Healthcare REIT, Inc. has appointed Clifford L. Neuman to
serve as the Company's secretary, effective immediately. Mr.
Neuman will replace Jacob Taylor as the Company's secretary. Mr.
Neuman previously served as the Company's secretary prior to 2017.
About Global Healthcare
Global Healthcare REIT, Inc., acquires, develops, leases, manages
and disposes of healthcare real estate, and provides financing to
healthcare providers. The Company's portfolio will be comprised of
investments in the following three healthcare segments: (i) senior
housing, (ii) post-acute/skilled nursing and (iii) bonds securing
senior housing communities.
Global Healthcare reported a net loss attributable to common
stockholders of $891,614 for the year ended Dec. 31, 2019, compared
to a net loss attributable to common stockholders of $2.02 million
for the year ended Dec. 31, 2018. As of Sept. 30, 2020, the
Company had $46.06 million in total assets, $44.13 million in total
liabilities, and $1.93 million in total equity.
MaloneBailey, LLP, in Houston, Texas, the Company's auditor since
2016, issued a "going concern" qualification in its report dated
July 10, 2020, citing that the Company has suffered recurring
losses from operations and has a net capital deficiency that raise
substantial doubt about its ability to continue as a going concern.
GRATITUDE TRAINING: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Gratitude Training, LLC
3901 NE 25th Ave
Lighthouse Point, FL 33064-8035
Business Description: Gratitude Training, LLC is a coaching
company offering transformational trainings.
Chapter 11 Petition Date: January 8, 2021
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 21-10143
Judge: Hon. Peter D. Russin
Debtor's Counsel: Chad Van Horn, Esq.
VAN HORN LAW GROUP, P.A.
330 N Andrews Ave. Ste. 450
Fort Lauderdale, FL 33301-1012
Tel: (954) 765-3166
E-mail: chad@cvhlawgroup.com
Total Assets: $40,811
Total Liabilities: $1,788,435
The petition was signed by Josephine Englesson, president.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/XU7ZYBQ/Gratitude_Training_LLC__flsbke-21-10143__0003.0.pdf?mcid=tGE4TAMA
A copy of the petition is available for free at PacerMonitor.com
at:
https://www.pacermonitor.com/view/XKAAA7Q/Gratitude_Training_LLC__flsbke-21-10143__0001.0.pdf?mcid=tGE4TAMA
GROWLIFE INC: Inks Third Amendment to Labrys Promissory Note
------------------------------------------------------------
GrowLife, Inc. entered into Amendment No. 3 to the
Self-Amortization Promissory Note as originally issued by the
Company to Labrys on Aug. 31, 2020. Pursuant to Amendment No. 3
the Company issued 340,000 restricted shares of the Company's
common stock to the Holder on or before Dec. 31, 2020 and issued a
common stock purchase warrant for the purchase of 1,033,057 shares
of the Company's common stock to the Holder on Dec. 31, 2020. In
exchange for the Warrant and Amendment Shares, the outstanding
payment of $125,000 owed on or before Dec. 31, 2020, was amended as
follows: In lieu of the Company's payment of the Outstanding
Payment to the Holder, the payment schedule in Section 4.17 of the
Note shall be amended as follows: (i) all references to
"$51,041.66" in Section 4.17 of the Note shall be replaced with
"$61,458.33" and (ii) the reference to "$51,041.74" in Section 4.17
of the Note shall be replaced with "$61,458.33."
About GrowLife
GrowLife, Inc. (PHOT)-- http://www.shopgrowlife.com-- aims to
become the nation's largest cultivation service provider for
cultivating organics, herbs and greens and plant-based medicines.
Through a network of local representatives covering the United
States and Canada, regional centers and its e-Commerce team,
GrowLife provides essential goods and services including media,
industry-leading hydroponics and soil, plant nutrients, and
thousands of more products to specialty grow operations. GrowLife
is headquartered in Kirkland, Washington and was founded in 2012.
GrowLife reported a net loss of $7.37 million for the year ended
Dec. 31, 2019, compared to a net loss of $11.47 million for the
year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had
$4.29 million in total assets, $7.65 million in total current
liabilities, $2.19 million in total long term liabilities, and a
total stockholders' deficit of $5.54 million.
BPM LLP, in Walnut Creek, California, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
April 1, 2020 citing that the Company has sustained a net loss from
operations and has an accumulated deficit since inception. These
factors raise substantial doubt about the Company's ability to
continue as a going concern.
GULFPORT ENERGY: Taps Kirkland & Ellis as Bankruptcy Counsel
------------------------------------------------------------
Gulfport Energy Corporation and its affiliates seek approval from
the U.S. Bankruptcy Court for the Southern District of Texas to
employ Kirkland & Ellis LLP and Kirkland & Ellis International LLP
as their legal counsel.
Kirkland will provide services in connection with the Debtors'
Chapter 11 cases, which include:
(a) advising the Debtors with respect to their powers and
duties in the continued management and operation of their
businesses and properties;
(b) advising and consulting on the conduct of the cases,
including all of the legal and administrative requirements of
operating in Chapter 11;
(c) attending meetings and negotiating with representatives of
creditors and other parties in interest;
(d) taking all necessary actions to protect and preserve the
Debtors' estates, including prosecuting actions on the Debtors'
behalf, defending any action commenced against the Debtors, and
representing the Debtors in negotiations concerning litigation in
which they are involved;
(e) preparing legal papers;
(f) representing the Debtors in connection with obtaining
authority to continue using cash collateral and postpetition
financing;
(g) advising the Debtors in connection with any potential sale
of assets;
(h) appearing before the bankruptcy court and any appellate
courts;
(i) advising the Debtors regarding tax matters;
(j) taking any necessary action on behalf of the Debtors to
negotiate, prepare and obtain approval of a disclosure statement
and confirmation of a Chapter 11 plan; and
(k) other necessary legal services including (i) analyzing the
Debtors' leases and contracts and the assumption and assignment or
rejection thereof; (ii) analyzing the validity of liens against the
Debtors; and (iii) advising the Debtors on corporate and litigation
matters.
Kirkland will be paid at these hourly rates:
Partners $1,075 - $1,845
Of Counsel $625 - $1,845
Associates $610 - $1,165
Paraprofessionals $245 - $460
The Debtors will reimburse Kirkland for work-related expenses
incurred.
The Debtors paid $1 million to Kirkland, which constituted an
"advance payment retainer" and an additional advance payment
retainer totaling $9,851,508.65.
Steven Serajeddini, Esq., president of Steven N. Serajeddini, P.C.,
a partner of Kirkland, disclosed in court filings that Kirkland is
"disinterested" within the meaning of Section 101(14) of the
Bankruptcy Code.
Mr. Serajeddini also made the following disclosures in response to
the request for additional information set forth in Paragraph D.1
of the Revised U.S. Trustee Guidelines:
a. Question: Did Kirkland agree to any variations from, or
alternatives to, Kirkland's standard billing arrangements for this
engagement?
Answer: No. Kirkland and the Debtors have not agreed to any
variations from, or alternatives to, Kirkland's standard billing
arrangements for this engagement. The rate structure provided by
Kirkland is appropriate and is not significantly different from (a)
the rates that Kirkland charges for other
non-bankruptcy representations or (b) the rates of other comparably
skilled professionals.
b. Question: Do any of the Kirkland professionals in this
engagement vary their rate based on the geographic location of the
Debtors' Chapter 11 cases?
Answer: No. The hourly rates used by Kirkland in
representing the Debtors are consistent with the rates that
Kirkland charges other comparable Chapter 11 clients regardless of
the location of the case.
c. Question: If Kirkland has represented the Debtors in the 12
months prepetition, disclose Kirkland's billing rates and material
financial terms for the prepetition engagement, including any
adjustments during the 12 months prepetition. If Kirkland's
billing rates and material financial terms have changed
postpetition, explain the difference and the reasons for the
difference.
Answer: Kirkland's current hourly rates for services
rendered on behalf of the Debtors range as follows:
Billing Category U.S. Range
Partners $1,075 - $1,845
Of Counsel $625 - $1,845
Associates $610 - $1,165
Paraprofessionals $245 - $460
Kirkland represented the Debtors from Jan. 1, 2020 through the
petition date using those hourly rates.
Kirkland represented the Debtors from Nov. 14 to Dec. 31, 2019
using the following hourly rates:
Billing Category U.S. Range
Partners $1,025 - $1,795
Of Counsel $595 - $1,705
Associates $595 - $1,125
Paraprofessionals $245 - $460
Kirkland's hourly rates for services rendered on behalf of the
Debtors on and after Jan. 1, 2021 range as follows:
Billing Category U.S. Range
Partners $1,085 - $1,895
Of Counsel $625- $1,895
Associates $625 - $1,195
Paraprofessionals $255 - $475
d. Question: Have the Debtors approved Kirkland's budget and
staffing plan, and, if so, for what budget period?
Answer: Yes, for the period from Nov. 13, 2020 to Jan. 31,
2021.
Kirkland can be reached through:
Steven N. Serajeddini, Esq.
Steven N. Serajeddini, P.C.
601 Lexington Avenue
New York, NY 10022
Tel: +1 212 446 4800
Fax: +1 212 446 4900
Email: steven.serajeddini@kirkland.com
About Gulfport Energy Corp.
Gulfport Energy Corporation (NASDAQ: GPOR) --
http://www.gulfportenergy.com/-- is an independent natural gas and
oil company focused on the exploration and development of natural
gas and oil properties in North America and a producer of natural
gas in the contiguous United States. Headquartered in Oklahoma
City, Gulfport holds significant acreage positions in the Utica
Shale of Eastern Ohio and the SCOOP Woodford and SCOOP Springer
plays in Oklahoma. In addition, Gulfport holds non-core assets
that include an approximately 22% equity interest in Mammoth Energy
Services, Inc. (NASDAQ: TUSK) and has a position in the Alberta Oil
Sands in Canada through its 25% interest in Grizzly Oil Sands ULC.
Gulfport Energy reported net loss of $2.0 billion for the year
ended Dec. 31, 2019 as compared to net income of $430.6 million for
the year ended Dec. 31, 2018. As of June 30, 2020, Gulfport had
$2.58 billion in total assets, $2.35 billion in total liabilities,
and $231.34 million in total stockholders' equity.
As of Sept. 30, 2020, Gulfport had $2,375,559,000 in assets and
$2,520,336,000 in liabilities.
Gulfport and its subsidiaries sought Chapter 11 protection (Bankr.
S.D. Tex. Lead Case No. 20-35562) on Nov. 13, 2020.
The Hon. David R. Jones is the case judge.
The Debtors tapped Kirkland & Ellis LLP as their bankruptcy
counsel; Jackson Walker L.L.P. as local bankruptcy counsel; Alvarez
& Marsal North America, LLC as restructuring advisor; and Perella
Weinberg Partners L.P. and Tudor, Pickering, Holt & Co. as
financial advisor; and PricewaterhouseCoopers LLP as tax services
provider. Epiq Corporate Restructuring LLC is the claims agent.
Wachtell, Lipton, Rosen & Katz is counsel for the special committee
of Gulfport's Board of Directors while Chilmark Partners is the
financial advisor.
Katten Muchin Rosenman LLP is counsel for the special committee of
the governing body of each Debtor other than Gulfport while M III
Parnters, LP is the financial advisor.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on Nov. 27,
2020. The committee is represented by Norton Rose Fulbright US LLP
and Kramer Levin Naftalis & Frankel, LLP.
HURDL INC: Prepackaged Plan of Reorganization Confirmed by Judge
----------------------------------------------------------------
Judge Shelley C. Chapman has entered findings of fact, conclusions
of law and order confirming the Prepackaged Plan of Reorganization
of Hurdl Inc.
As more fully described in the Plan, the Debtor executed the
Restructuring Support Agreement ("RSA") on Nov. 12, 2020 that
provided for terms of a Prepackaged Plan of Reorganization. It
commenced solicitation on Nov. 24, 2020. Pinnacle Bank, the Holder
of Class 1 First Lien Claims, immediately returned its ballot.
Because of the Debtor's dire financial condition, there is less
than $10,000 of cash in the Debtor's business operating account.
The Debtor was able to reach an agreement with the holders of First
Lien Claims and the requisite number of voting Bridge Loan Claims
for confirmation regarding the terms of a consensual restructuring
after hard-fought negotiations with Pinnacle and other parties.
Those terms were memorialized in the Amended and Restated
Restructuring Support Agreement (the "RSA") and the Debtor's
proposed chapter 11 plan reflecting the RSA's terms.
Among other things, the restructuring contemplates: partial payment
for the First Lien Claims; a seven cent recovery to Bridge Loan
Claims and a 1.5% interest, in the aggregate, of the Reorganized
Debtor; and a five cent recovery to General Unsecured Claims if
that class votes in favor of the Plan, which is expected to occur.
The Plan contemplates a complete deleveraging of the Debtor's
approximately $4.7 million of liabilities, working capital to fund
the Debtor's ongoing operations during the chapter 11 case and upon
emergence, and enables the Debtor to maintain its critical business
relationships with customers and vendors.
The Plan contemplates, among other things, that Pinnacle Bank, the
Holder of Allowed Class 1-First Lien Claims, will receive a
ten-cent recovery on account of its secured claim against the
Debtor; and Holders of Allowed Class 3-General Unsecured Claims, if
the class votes in favor of the Plan, which is expected, will
receive a five-cent recovery on account of their respective Allowed
General Unsecured Claims.
A full-text copy of the Plan Confirmation Order and Prepackaged
Plan entered Jan. 7, 2021, is available at https://bit.ly/35nyCo8
Proposed Counsel to the Debtor:
Joseph A. Pack
PACK LAW, P.A.
777 Westchester Avenue, Suite 101
White Plains, NY 10604
Telephone: (212) 949-9300
About Hurdl Inc.
Hurdl Inc. is in the business of live event data capture and
personalized SMS marketing.
Hurdl Inc. sought Chapter 11 protection (Bankr. S.D.N.Y. Case No.
20-12768) on Nov. 30, 2020. Hurdl disclosed total assets of
$484,613 and total liabilities of $4,877,677 as of the bankruptcy
filing. The Hon. Shelley C. Chapman is the case judge. PACK LAW,
P.A., is the Debtor's counsel. GLASSRATNER ADVISORY & CAPITAL
GROUP, LLC, is the financial advisor.
IMERYS TALC: Certain Insurers Say Confirmation Schedule Unrealistic
-------------------------------------------------------------------
Century Indemnity Company, Federal Insurance Company, and Central
National Insurance Company of Omaha, TIG Insurance Company,
International Surplus Lines Insurance Company, Mt. McKinley
Insurance Company, Fairmont Premier Insurance Company, Everest
Reinsurance Company, The North River Insurance Company, Employers
Mutual Casualty Company, First State Insurance Company, and
Hartford Accident & Indemnity Company (collectively, "Certain
Insurers") object to both the proposed disclosure statement for
fifth amended plan and proposed confirmation schedule of Imerys
Talc America, Inc. and Its Debtor Affiliates.
On Dec. 22, 2020, the Debtors filed the Fifth Amended Plan and a
Disclosure Statement. The Plan contains broad new changes that lead
to new questions about the sufficiency of the Disclosure Statement
that could not have been anticipated when Certain Insurers filed
their objections to the Second Amended Plan.
These new objections are limited to the additional material in the
Disclosure Statement that relate to the Cyprus settlement. The
Insurers address the Debtors' most recent proposed confirmation
schedule, which is seriously outdated without even taking into
account the additional discovery that may be appropriate regarding
the Cyprus settlement.
Certain Insurers still assert that:
* The key changes made by the Fifth Amended Plan, compared to
the previous two iterations of the plan, incorporate the "Cyprus
Settlement," the terms of which are set forth in Section 10.10 of
the Plan. With respect to the Cyprus Settlement, the Disclosure
Statement for the Plan mostly repeats what is in the Plan, with no
additional explanation.
* The Disclosure Statement does not explain why the Cyprus
Settlement is beneficial to the Debtors and their estates. The
Disclosure Statement should be revised to provide the grounds
supporting Debtors' contention that the settlement should be
approved under Rule 9019.
* Debtors continue to propose an unrealistically rapid
confirmation schedule that should be rejected by the Court. The
schedule needs to build in a reasonable amount of time for Plan
Proponents to respond to discovery being served this week and for
objectors to review Plan Proponents' discovery responses and
produced documents before having to start taking depositions.
* Certain Insurers are prepared to work hard. But the schedule
proposed by Debtors is both unrealistic and unreasonably one-sided.
The Court should reject Debtors' proposed schedule in favor of one
that is both more realistic and more even-handed.
A full-text copy of Certain Insurers' objection dated Jan. 7, 2021,
is available at https://tinyurl.com/yxarn4cs from PacerMonitor.com
at no charge.
Attorneys for Century Indemnity:
Marc S. Casarino
WHITE AND WILLIAMS LLP
Courthouse Square
600 N. King Street, Suite 800
Wilmington, Delaware 19801
Phone: (302) 654-0424
E-mail: casarinom@whiteandwilliams.com
Mark D. Plevin
CROWELL & MORING LLP
Three Embarcadero Center, 26th Floor
San Francisco, California 94111
Phone: (415) 986-2800
E-mail: mplevin@crowell.com
Tacie H. Yoon
CROWELL & MORING LLP
1001 Pennsylvania Ave., N.W.
Washington, D.C. 20004
Phone: (202) 624-2500
E-mail: tyoon@crowell.com
Attorneys for TIG Insurance:
Marc J. Phillips
MONTGOMERY MCCRACKEN WALKER & RHOADS LLP
1105 North Market Street, Suite 1500
Wilmington, Delaware 19801
Phone: 302-504-7823
Fax: 215-731-3777
E-mail: mphillips@mmwr.com
George R. Calhoun
IFRAH PLLC
1717 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Phone: (202) 525-4147
E-mail: george@ifrahlaw.com
Attorneys for The American Insurance:
John S. Spadaro
JOHN SHEEHAN SPADARO LLC
724 Yorklyn Rd, #375
Hockessin, Delaware 19707
Telephone: (302) 235-7745
E-mail: jspadaro@johnsheehanspadaro.com
Leslie A. Davis
TROUTMAN SANDERS LLP
401 9th Street, N.W.
Washington, DC 20004
Telephone: (202) 274-2950
E-mail: Leslie.davis@troutman.com
About Imerys Talc America
Imerys Talc and its
subsidiaries--https://www.imerys-performance-additives.com/ -- are
in the business of mining, processing, selling, and distributing
talc. Talc is a hydrated magnesium silicate that is used in the
manufacturing of dozens of products in a variety of sectors,
including coatings, rubber, paper, polymers, cosmetics, food, and
pharmaceuticals. Its talc operations include talc mines, plants,
and distribution facilities located in: Montana (Yellowstone,
Sappington, and Three Forks); Vermont (Argonaut and Ludlow); Texas
(Houston); and Ontario, Canada (Timmins, Penhorwood, and Foleyet).
It also utilizes offices located in San Jose, California and
Roswell, Georgia.
Imerys Talc America, Inc., and two subsidiaries, namely Imerys Talc
Vermont, Inc., and Imerys Talc Canada Inc., sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 19-10289) on Feb. 13,
2019.
The Debtors were estimated to have $100 million to $500 million in
assets and $50 million to $100 million in liabilities as of the
bankruptcy filing.
The Hon. Laurie Selber Silverstein is the case judge.
The Debtors tapped Richards, Layton & Finger, P.A., and Latham &
Watkins LLP as counsel; Alvarez & Marsal North America, LLC as
financial advisor; and Prime Clerk LLC as claims agent.
IMERYS TALC: Insurers Question Cyprus Deal, Object to Disclosures
-----------------------------------------------------------------
Law360 reports that a group of insurers is asking a Delaware
bankruptcy judge to reject Imerys Talc America's latest Chapter 11
plan disclosure, saying it includes a poorly explained $130 million
settlement with Imerys' former parent company.
Groups of both primary and excess insurers said Imerys' fifth
Chapter 11 plan disclosure contains too little information on the
newly announced settlement with Cyprus Mines Corp. and Cyprus Amax
Minerals Co., in particular how a Cyprus Mines bankruptcy filing
that is part of the settlement will affect the deal.
As reported in the TCR, Imerys Talc America, Inc., et al. and
Imerys Talc Italy S.P.A., filed the Disclosure Statement for Fifth
Amended Joint Chapter 11 Plan of Reorganization. The Plan
effectuates a global settlement (the "Cyprus Settlement") among the
Debtors, Cyprus Mines Corporation, Cyprus Amax Minerals Company,
and Freeport-McMoRan Inc. ("Freeport," and together with Cyprus,
the "Cyprus Parties"), the Tort Claimants' Committee, the FCR, and
the Imerys Plan Proponents (collectively, the "Cyprus Settlement
Parties"), which represents a comprehensive resolution of all
issues between and among the Cyprus Settlement Parties, and
resolves (i) the treatment of Talc Personal Injury Claims relating
to Cyprus, (ii) disputes between Cyprus and the Debtors regarding
entitlement to certain insurance proceeds between Cyprus and the
Debtors, and (iii) disputes between Cyprus and the Debtors
regarding ownership of certain indemnification rights. The Cyprus
Settlement, like the Imerys Settlement and the Rio Tinto/Zurich
Settlement, provides a significant benefit to holders of Talc
Personal Injury Claims.
A full-text copy of the Fifth Amended Joint Plan dated Dec. 22,
2020, is available at https://bit.ly/2WUUGlp from PacerMonitor at
no charge.
About Imerys Talc America
Imerys Talc and its subsidiaries --
https://www.imerys-performance-additives.com/ -- are in the
business of mining, processing, selling, and distributing talc.
Talc is a hydrated magnesium silicate that is used in the
manufacturing of dozens of products in a variety of sectors,
including coatings, rubber, paper, polymers, cosmetics, food, and
pharmaceuticals. Its talc operations include talc mines, plants,
and distribution facilities located in: Montana (Yellowstone,
Sappington, and Three Forks); Vermont (Argonaut and Ludlow); Texas
(Houston); and Ontario, Canada (Timmins, Penhorwood, and Foleyet).
It also utilizes offices located in San Jose, California and
Roswell, Georgia.
Imerys Talc America, Inc., and two subsidiaries, namely Imerys Talc
Vermont, Inc., and Imerys Talc Canada Inc., sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 19-10289) on Feb. 13,
2019.
The Debtors were estimated to have $100 million to $500 million in
assets and $50 million to $100 million in liabilities as of the
bankruptcy filing.
The Hon. Laurie Selber Silverstein is the case judge.
The Debtors tapped Richards, Layton & Finger, P.A., and Latham &
Watkins LLP as counsel; Alvarez & Marsal North America, LLC as
financial advisor; and Prime Clerk LLC as claims agent.
INTERSTATE COMMODITIES: Architect Outbid Rivals to Buy Property
---------------------------------------------------------------
Robin K. Cooper of the Albany Business Review reports that
architect Tony D'Adamo outbid at least three competitors to become
the prospective buyer of Interstate Commodities Inc.'s warehouse
and office complex in South Troy, New York.
Through a real estate holding company called 1000 Davis LLC, the
architect submitted a $570,000 offer to purchase the property on
Madison and First streets. The offer comes less than two months
after a federal bankruptcy court judge authorized broker NAI
Platform to find a buyer for the 1.1-acre complex.
Judge Robert Littlefield Jr. could approve the sale before the end
of January 2021. A closing is tentatively scheduled for Jan. 29,
2021, according to court records.
"A number of people wanted to use the property or develop it," said
listing agent Deanna Dal Pos of NAI Platform. "There are a lot of
disappointed players out there."
Property owner Interstate Commodities Inc. is selling rail cars and
real estate to pay down a portion of its debt after filing for
Chapter 11 bankruptcy protection in August. The 74-year-old corn,
grain and soybean trading company at one time managed more than
10,000 rail cars and operated grain and fertilizer plants across
the country.
Broker Doug Bricker of Coldwell Banker Prime Properties represented
1000 Davis LLC, according to bankruptcy court records.
The Madison Street complex includes about 37,000 square feet of
office and warehouse space and multiple parking lots, according to
real estate records. The sale also would include 7,450 tons of
feed and a wireless antenna lease with T-Mobile.
In November, Judge Robert Littlefield authorized the property to be
listed for $450,000. 1000 Davis LLC made an all-cash offer of
$570,000 that included a $57,000 deposit, court records show.
About Interstate Commodities
Interstate Commodities Inc. engages in the merchandise of
commodities. It offers whole corn, soybean meal, soybeans, soy
hulls, soyhull pellets, corn gluten meal, canola meal, sunflower
meal, beet pulp pellets, citrus pulp pellets, and wheat.
Interstate Commodities filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D.N.Y. Case No.
20-11139 on Aug. 26, 2020. The petition was signed by Michael G.
Piazza, chief operating officer. At the time of filing, the Debtor
disclosed $12,558,336 in assets and $25,513,305 in liabilities.
Gerard R. Luckman, Esq., at FORCHELLI DEEGAN TERRANA LLP, is the
Debtor's counsel. NAI Platform is the real estate broker.
INVESTVIEW INC: Unit Reports $1.88M Monthly Bitcoin Mining Revenue
------------------------------------------------------------------
Investview, Inc. reported that its SafeTek subsidiary has reached a
new all-time-high monthly revenue and profit margin. SafeTek
increased its Bitcoin mining revenue by an estimated 33.5% (from
approximately $1.40 million in November 2020 to approximately $1.88
million in December 2020) and profit margin by an estimated 30%
(from approximately $817,000 in November 2020 to approximately
$1.06 million in December 2020). SafeTek produced nearly 86
Bitcoin in December- averaging approximately 2.77 BTC per day.
This growth was made possible through INVU's strategic investments
in cryptocurrency mining hardware, software & enhanced IT
operations, and was further bolstered by significant Bitcoin price
increases which appreciated by over 48% in December to near
$28,700.
Investview's EVP of Crypto Operations Rob Walther commented, "We
are pleased to announce that INVU's strategic decisions to increase
investment into additional mining hardware, optimize mining
software, and enhance our IT operation, combined with the
substantial increase in the price of Bitcoin, continues to
contribute to the largest revenue and profit margin ever earned by
SAFETek, INVU's digital asset mining operation. This represents a
new milestone for SafeTek with revenue growth of 33.5% to $1.88
million and profits expanding by nearly 30% to $1.06 million in
December."
About Investview
Headquartered in Salt Lake City, Utah, Investview, Inc. --
www.investview.com -- is a diversified financial technology and
global distributor organization that operates through its
subsidiaries to provide financial education tools, content,
research and management of digital asset technology that mines
cryptocurrencies, with a focus on Bitcoin mining and the generation
of digital assets.
Investview reported a net loss of $21.28 million for the year ended
March 31, 2020, compared to a net loss of $4.98 million for the
year ended March 31, 2019. As of Sept. 30, 2020, the Company had
$9.71 million in total assets, $29.32 million in total liabilities,
and a total stockholders' deficit of $19.61 million.
Haynie & Company, in Salt Lake City, Utah, the Company's auditor
since 2017, issued a "going concern" qualification in its report
dated June 29, 2020, citing that the Company has suffered losses
from operations and its current cash flow is not enough to meet
current needs. This raises substantial doubt about the Company's
ability to continue as a going concern.
IONIX TECHNOLOGY: Signs $253,500 Funding Agreements with Labrys
---------------------------------------------------------------
Ionix Technology, Inc. executed and closed on the following
agreements with Labrys: (i) Securities Purchase Agreement dated Dec
21, 2020; and (ii) Self-Amortization Promissory Note dated Dec. 21,
2020. The Company entered into the Labrys Agreements with the
intent to acquire working capital to fund current operations and
grow the Company's business.
The total amount of funding under the Labrys Agreements is
$253,500. The Notes carry an original issue discount of $30,000, a
transaction expense amount of $3,000, and a fee to J. H. Darbie &
Co. of $13,500, for total debt of $300,000. The Note has an
amortization schedule of $35,000 at each month end beginning April
23, 2021 through Dec. 21, 2021. The Company issued commitment
shares related to the Labrys Agreements as follows: 447,762 shares
of Common Stock and 1,119,402 shares of Common Stock. The Second
Commitment Shares must be returned to the Borrower's treasury if
the Note is fully repaid and satisfied on or prior to the Maturity
Date. The Company agreed to reserve 7,052,239 shares of its common
stock for issuance if any Debt is converted. The Debt is due on or
before Dec. 21, 2021. The Debt carries an interest rate of five
percent. The Note is not convertible unless in Default, as defined
in the Note. If the Note is in Default, the Debt is convertible
into the Company's common stock at a conversion price which shall
equal the lesser of (i) the closing bid price of the Common Stock
on the Principal Market on the Trading Day immediately preceding
the Issue Date or (ii)the closing bid price of the Common Stock on
the Principal Market on the Trading Day immediately preceding the
date of the respective conversion, subject to adjustment as
provided for in the Note.
About Ionix
Headquartered in Liaoning Province, China, Ionix Technology, Inc.
-- http://www.iinx-tech.com-- is a holding company that is
principally engaged in the photoelectric display and smart energy
industries. The company has four operating subsidiaries: Changchun
Fangguan Photoelectric Display Technology Co., Ltd, a company which
specializes in developing, designing, producing, and selling TN and
STN LCD, STN, CSTN, and TFT LCD modules as well as other related
products; Shenzhen Baileqi Electronic Technology Co., Ltd, a
company which specializes in LCD slicing, filling, researching and
designing, manufacturing and selling of LCD Modules (LCM) and PCBs;
Lisite Science Technology (Shenzhen) Co., Ltd., a company engaged
in the production of intelligent electronic devices; and Dalian
Shizhe New Energy Technology Co., Ltd., a company engaged in
photo-voltaic power generation, electric vehicles and charging
piles with corresponding operation and maintenance and three
dimensional parking.
Ionix reported a net loss of $277,668 for the year ended June 30,
2020, compared to net income of $397,047 for the year ended June
30, 2019. As of Sept. 30, 2020, the Company had $17.12 million in
total assets, $7.23 million in total liabilities, and $9.89 million
in total stockholders' equity.
JCV GROUP: Judge Rejects Plan & Disclosures
-------------------------------------------
Judge Martin Glenn ordered that for the reasons stated on the
record at the hearing held on Jan. 7, 2021, the Court DENIES
approval of JCV Group LLC's Amended Disclosure Statement and DENIES
confirmation of the Debtor's Chapter 11 Plan.
The order did not state the judge's reasons for rejecting the plan
documents.
To recall, on Dec. 8, 2020 the Bankruptcy Court authorized the
Debtor to solicit votes to accept or reject the Debtor's Plan of
Reorganization fixed a Jan. 7 hearing to consider confirmation of
the Plan and final approval of the Disclosure Statement.
The Debtor's Plan sought to implement a transfer on the Effective
Date to the Litigation Trust which will be administered by the
Debtor's existing owners acting as the Trustee for the benefit of
the Class 3 General Unsecured Claims. The Litigation Trust is
funded by: (i) all of the Debtor's rights to recover sums resulting
from the Warehouse Inventory valued at $657,948 and which will be
pursued against Capital Logistics & Warehousing and/or against the
Debtor's insurer, Traveler's Insurance Company for the value of the
Warehouse Inventory; and (ii) the value of any recovery from the
Debtor's prepetition claim against National Bankruptcy Stores
estimated to be in the amount of $364,137.35. The Debtor estimates
the value of its contribution to the Litigation Trust to be
approximately $1,022,085. While the face amount of Claims
described below in Class 3 exceeds the value of the Debtor's
contribution to the Litigation Trust, the Debtor, pursuant to the
Plan shall engage in the claims objection process to reduce
substantially the claims asserted in Class 3 on the basis that more
than 50% of the Class 3 Claims appear to be vastly overstated in
connection with the Claims Objections. The Debtor believes that in
good faith it will recover 100% of the Allowed Amounts owed to
Class 3 Creditors leaving a surplus balance for Class 4 Equity
Interests upon completion of the Litigation Trust.
A full-text copy of the Amended Disclosure Statement dated Dec. 14,
2020, is available at https://bit.ly/3h8Fzy6 from PacerMonitor.com
at no charge.
Attorneys for the Debtor:
Eric S. Medina, Esq.
Medina Law Firm LLC
641 Lexington Avenue
Thirteenth Floor
New York, NY 10022
Telephone: (212) 404-1742
Facsimile: (888) 833-9534
About JCV Group LLC
JCV Group LLC -- http://jcvbrands.com-- designed, manufactured,
and licensed wholesale baby, pet, and household bedding products
that it sold domestically and internationally. JCV was established
in New York City, operating from its offices and showroom at 65
West 37th Street, Suite 300, New York, New York. JCV's members
boast 30 plus years of experience in manufacturing and wholesale.
JCV Group LLC filed a voluntary petition for relief under chapter
11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 19-13563) on
Nov 06, 2019. In the petition signed by David Maleh, chief
executive officer, the Debtor estimated $1 million to $10 million
in both assets and liabilities. Eric S. Medina, Esq. at MEDINA LAW
FIRM LLC is the Debtor's counsel.
JDUB'S BREWING: $400K Sale of Mango Property to Fund Plan
---------------------------------------------------------
JDub's Brewing Company, LLC, has filed its Second Amended Chapter
11 Plan that contemplates, among other things, the transactions the
sale of its assets at its brewery in Sarasota, Florida, as a means
to effectuate the Second Amended Plan.
Prior to the Petition Date, the Debtor operated a craft beer
brewery and tap room located at 1215 Mango Avenue, Sarasota,
Florida 34237 (the "Mango Property"). The Debtor occupied the
Mango Property pursuant to a lease of nonresidential real property
with 1215 Mango, LLC.
Since the onset of the COVID-19 pandemic, the Debtor has been
determined to refine its business model to emphasis methods of
marketing and distribution of "JDub's" branded beers and products
through business relations, including joint ventures or other
avenues.
As part of this, the Debtor has considered the sale of the Mango
FFE and business operations at the Mango Property as a "turnkey
operation." The Debtor has approached numerous industry contacts
who may have synergy or who have expressed interest in the Mango
FFE and operating a business at the Mango Property (including those
contacts referred to it by J.J. Taylor Distributing Florida, Inc.).
The Mango FFE is subject to a security interest claimed by
American Momentum Bank ("AMB").
Brew Theory LLC has submitted a written offer to purchase the Mango
FFE, and the Mango Lease for $400,000.
As operations at the Mango Property will cease, the Debtor will
distribute its products through revised agreements with Brew Theory
which the Debtor will likewise seek authority for. The Debtor does
not believe resolicitation is necessary as the projected disposable
income available to the unsecured claims remains the same.V.
Lone Plan Objection
There is one objection to the Plan filed by J.J. Taylor
Distributing Florida, LLC. Prior to the Petition Date, the Debtor
and JJT entered into a Distribution Agreement. However, JJT failed
to perform under the agreement and during the course of the
bankruptcy case the Debtor rejected the same. In the wake of the
rejection, JJT filed an exorbitant $1,860,451 claim for rejection
damages. The Debtor has filed its Objection to Claim 12 of,
objecting to the claim for three reasons: (i) the claim fails to
properly depict how it arrived at the calculations, (ii) the claim
includes damages beyond the rejection date and (iii) the Debtor
objected to the claim to the extent it was filed in bad faith. In
response to the Debtor's objection, JJT filed 12 objections to
confirmation. The Debtor asserts that the JJT Objection as a whole
is frivolous and wholly lacking merit. The objections ask
questions that are readily apparent on the face of the Plan.
Treatment of Claims
Under the Plan, Class 6 General Unsecured Claims ($3,158,388.78
excluding any deficiency claims or the portion of any Allowed Claim
classified as a Secured Claim that is determined to be an Unsecured
Claim identified in the above classes) will share pro rata in the
Unsecured Creditor Amount in equal annual installments over 5
years.
"Unsecured Creditor Amount" means the amount by which Projected
Disposable Income over a 5-year period that exceed the amount of
Allowed Administrative Expense Claims, Priority Tax Claims, other
payments that may be due on the Effective Date and payments made to
the Holders of Allowed Secured Claims. For the purposes of
confirmation, the Debtor estimates the Unsecured Creditor Amount
will be $51,000.
A full-text copy of the Second Amended Chapter 11 Plan dated Dec.
14, 2020, is available at https://bit.ly/3rh2dc5 from
PacerMonitor.com at no charge.
Counsel for the Debtor:
David S. Jennis
Daniel E. Etlinger
Jennis Law Firm
606 East Madison Street
Tampa, FL 33602
Telephone: (813) 229-2800
Email: djennis@jennislaw.com
detlinger@jennislaw.com
About JDub's Brewing Company
JDub's Brewing Company, LLC, is a privately held company in the
beverage manufacturing industry.
The company sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. Fla. Case No.20-02926) on April 6, 2020. In the
petition signed by CEO Jeremy Joerger, the company disclosed
$697,542 in assets and $1,687,781 in debt. Judge Michael G.
Williamson is assigned to the case. Daniel Etlinger, Esq., at
David Jennis, PA, d/b/a Jennis Law Firm, is serving as the Debtor's
counsel.
K & L TRAILER: JPM Financial Buying Trailers for $5,000 Cash
------------------------------------------------------------
Gary Murphey, the Chapter 11 trustee for K & L Trailer Leasing,
Inc., asks the U.S. Bankruptcy Court for the District of Tennessee
to authorize the sale of the trailers listed on Exhibit A to JPM
Financial, LLC for $5,000 cash.
A hearing on the Motion is set for Feb. 4, 2021, at 10:00 a.m.
By Order entered Oct. 23, 2020, the Court approved the sale of
substantially all of the Debtor's assets to JPM Financial.
Community Trust Bank, Inc. had liens in the Trailers listed on
Exhibit A as evidenced by the proof of claim filed as Claim 67 on
behalf of Community Trust in the Chapter 11 case and elected to
remove the Trailers from the Sale. All of the Trailers were being
leased by the Debtor to customers in the ordinary course of
business and continue to be subject to such leases that have been
assigned to JPM Financial pursuant to the Sale.
Following the Sale, JPM Financial purchased the claims held by
Community Trust and now asserts a secured claim in the Trailers in
the amount of $86,618. The Trustee believes that the Trailers have
a value reflected on Exhibit A in the amount of at least $90,000,
which exceeds the amount of liens held by JPM Financial, and by the
Motion, the Trustee asks to sell the Trailers to JPM Financial.
The Trustee and JPM Financial have reached an agreement to sell the
Trailers to JPM Financial "as is," without warranty, and free and
clear of any liens in the Trailers for the amount of $5,000 cash to
be paid within three business days following the entry of an order
approving the Motion.
The Trustee and JPM Financial will pro rate or adjust all
applicable personal property taxes as of the Closing Date and JPM
Financial requires that the order approving the Sale include the
following findings: (i) the Sale will be free and clear of all
liens, (ii) JPM Financial has acted in good faith pursuant to
Section 363(m) of the Bankruptcy Code, and (iii) the stay under
Rule 6004(h) will not apply.
Therefore, the Trustee asks that the Proposed Sale Order be
effective immediately to permit the Sale to close without any
delay. The 14-day stay under Bankruptcy Rule 6004(h) should be
waived.
A copy of the Exhibit A is available at https://bit.ly/3nhMLt3 from
PacerMonitor.com free of charge.
About K & L Trailer Leasing
K&L Trailer Leasing, Inc., a company based in Knoxville, Tenn.,
filed a Chapter 11 petition (Bankr. E.D. Tenn. Case No. 20-31620)
on June 29, 2020. At the time of the filing, Debtor was estimated
to have $10 million to $50 million in both assets and liabilities.
Judge Suzanne H. Bauknight oversees the case.
Gentry Tipton & McLemore, P.C. is Debtor's bankruptcy counsel.
Gary M. Murphey was appointed as Debtor's Chapter 11 trustee. He
is represented by Bradley Arant Boult Cummings.
KHAN REAL ESTATE: Feb. 2 Plan Confirmation Hearing Set
------------------------------------------------------
On Jan. 5, 2021, the U.S. Bankruptcy Court for the District of
Montana held a hearing on final approval of the Disclosure
Statement for the Plan of Liquidation filed by debtor Khan Real
Estate LLC dated Nov. 20, 2020. Judge Benjamin P. Hursh approved
the Disclosure Statement and ordered that:
* Feb. 2, 2021, at 9:00 a.m. in the Ella Knowles Courtroom,
4th Floor Room 4805, James F. Battin United States Courthouse, 2601
2nd Avenue North, Billings, Montana is the hearing on confirmation
of the Plan.
* Jan. 22, 2021, is fixed as the last day for filing and
serving written objections to confirmation of Debtor's Plan, and
for filing written acceptances or rejections of said Plan.
After filing for bankruptcy, the Debtor received a buy/sell offer
for $1,480,000 from HAB Development Corporation for the Debtor's
real property and $160,000 for the furnishings, fixtures and
equipment owned by Western Inn LLC. The sale was approved by the
Court and closed on Oct. 7, 2020.
Pender West Credit I REIT, the secured creditor, was paid the sum
of $1,250,000 from the sale of the Debtor's real property. Crowley
Fleck PLLP's $75,000 claim and Yellowstone County Treasurer's
$17,745 claim have also been paid in full. Mansoor A. Khan has an
unsecured claim of $5,000, but Khan is an equity holder and will
not receive monies through the Plan. Under the Plan,
administrative claims will be paid within 30 days after approval of
the fees. Priority tax claims will be paid from what's left of the
sale proceeds.
A full-text copy of the Order entered Jan. 5, 2021, is available at
https://bit.ly/3pXOtSc
A copy of the Disclosure Statement dated Nov. 20, 2020, is
available at ttps://bit.ly/2L5P2uE
The Debtor is represented by:
James A. Patten, Esq.
Molly S. Considine, Esq.
Patten, Peterman, Bekkedahl & Green, PLLC
2817 2nd Avenue North, Ste. 300
P.O. Box 1239
Billings, MT 59103-1239
Telephone: (406) 252-8500
Facsimile: (406) 294-9500
E-mail: apatten@ppbglaw.com
mconsidine@ppbglaw.com
About Khan Real Estate
Khan Real Estate is engaged in the business of building management
in Yellowstone County, Montana. Khan Real Estate LLC was a single
asset real estate (as defined in 11 U.S.C. Section 101(51B)) -- it
owned the Western Motel property located at 3311 2nd Avenue North,
Billings, Yellowstone County, Montana.
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.
KOPIN CORPORATION: CEO Gets $600K Annual Salary Under Amended Deal
------------------------------------------------------------------
The Compensation Committee of the Board of Directors of Kopin
Corporation approved the tenth amended and restated employment
agreement with Dr. John C.C. Fan, chief executive officer of Kopin,
which became effective as of Jan. 1, 2021 and terminates on Dec.
24, 2022. Pursuant to the Employment Agreement, Dr. Fan will be
paid salary at an annual rate of $600,000 per year, subject to the
Board's right to determine his salary and benefits for each
subsequent year. If prior to the expiration of the Employment Term
as defined in the Employment Agreement (i) Dr. Fan is terminated by
the Employer without Cause, as defined in the Employment Agreement,
other than by reason of disability, (ii) Dr. Fan dies, or (iii) Dr.
Fan resigns for Good Reason, as defined in the Employment Agreement
within 12 months following a Change in Control, as defined in the
Employment Agreement, of the Employer, Employer shall pay any
prorated unpaid cash bonus earned and accrued but unpaid vacation
benefit and immediately vest all options to purchase Employer's
stock, all stock appreciation rights, all restricted stock awards,
and any other compensatory equity awards, granted by the Employer
to the Employee. Provided that Dr. Fan does not resign prior to
the end of the Employment Term and is not terminated by the
Employer for Cause, the Employer shall pay to Dr. Fan (or in the
event of his death prior to completion of all installments to his
surviving spouse, or if none to his estate) a cash retirement
benefit of $1,500,000 in 24 equal monthly installments commencing
with the next regularly scheduled pay date for executives following
Dec. 24, 2022. Provided that Dr. Fan does not resign prior to the
end of the Employment Term and is not terminated by the Employer
for Cause, each January the Employer shall pay to Dr. Fan (or in
the event of his death prior to completion of all installments to
his spouse) for supplemental health coverage $40,000 per year
commencing with January 2023 and ending with January 2032. Dr. Fan
is entitled to indemnification from claims made against him in
connection with his service to the Company. In addition, the
Company will reimburse Dr. Fan for legal expenses if he prosecutes
a successful legal action against the Company to enforce the
Employment Agreement unless he is not the prevailing party. Under
the terms of the Employment Agreement Dr. Fan assigns all
inventions and agrees to a covenant not-to compete for a period of
12 months following termination.
In addition, Dr. Fan received two grants of restricted stock of
144,422 and 144,421, respectively - upon the achievement of two
milestones. The first milestone must be achieved by Dec. 31, 2021
and the second by June 30, 2022. As of the Employee's Termination
Date, all rights to earn any of the Performance Equity Awards to
the extent not previously earned shall terminate. In the event of
Employee's death prior to earning the Performance Equity Awards any
earned but unvested portion of the Performance Equity Awards shall
vest and be distributed to the Employee's surviving spouse or if
none to his estate. Dr. Fan was also granted five tranches of
188,000 shares of restricted stock which are to vest at the end of
the first 20 consecutive trading day period following the grant
date (Dec. 31, 2020) during which Kopin Corporation's common stock
trades at various price points of the Company's common stock. The
period to achieve the stock price milestones are from Jan. 1, 2021
through Dec. 31, 2023.
Dr. Fan will also be entitled to receive an annual cash bonus and
an annual stock incentive award consistent with and subject to
substantially similar conditions as any annual cash bonuses and
annual stock incentive awards granted to other senior executives.
About Kopin
Kopin Corporation -- http://www.kopin.com-- is a developer and
provider of transmissive and reflective active matrix liquid
crystal and organic light emitting diode (OLED) micro displays for
integration into systems for military, industrial and consumer
products. Kopin's technology portfolio includes ultra-small
displays, optics, and low-power ASICs.
Kopin reported a net loss of $29.47 million for fiscal year 2019, a
net loss of $34.48 million for fiscal year 2018, and a net loss of
$25.38 million for fiscal year 2017. As of Sept. 26, 2020, the
Company had $37.66 million in total assets, $11.93 million in total
current liabilities, $255,050 in noncurrent contract liabilities
and asset retirement obligations, $992,712 in operating lease
liabilities (net of current portion), $1.17 million in other
long-term obligations, and $23.30 million in total stockholders'
equity.
RSM US LLP, in Stamford, Connecticut, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
March 11, 2020, citing that the Company has suffered recurring
losses from operations and recurring negative operating cash flows
that raise substantial doubt about its ability to continue as a
going concern.
LAMAR ADVERTISING: S&P Alters Outlook to Stable, Affirms 'BB-' ICR
------------------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' issuer credit rating on
U.S.-based Lamar Advertising Co. and revised its outlook to stable
from negative.
The stable outlook reflects S&P's expectation that outdoor
advertising spending in Lamar's markets will gradually recover in
2021, and the company will maintain leverage in the 4.5x-5x range.
The outlook revision reflects Lamar's better-than-expected
operating performance through the first three quarters of 2020 and
S&P's expectation that the company will maintain adjusted leverage
in the 4.5x-5x range through 2021. Lamar generates most of its
revenue and EBITDA from billboards in small and midsize U.S.
markets. These boards rely on local advertising and automobile
traffic and have been more resilient throughout the pandemic and
recession than the performance of billboards in large markets with
a higher percentage of national advertising revenue. To date,
drivership in Lamar's markets has largely recovered. The company
does not have significant exposure (less than 10%) to transit and
airport advertising displays, which have experienced steep declines
as the pandemic greatly reduced commuter ridership and air traffic.
S&P said, "We expect traditional billboard advertising will recover
back to prepandemic levels by the end of 2021, likely faster than
transit and airport advertising. We expect a full recovery in the
sector in the 2022/2023 timeframe because compared to television,
radio, and print, outdoor advertising is inexpensive and primarily
target a stable demographic of drivers, commuters, and
pedestrians."
"Although the recession has negatively impacted Lamar's operating
performance through the first three quarters of 2020 and will
likely hurt its performance over the next few quarters, we believe
it is unlikely to exceed our 5.5x downgrade threshold. We expect
leverage will remain below 5x in 2020 and will gradually decline
toward 4.5x in 2021 as revenue and EBITDA recover over the course
of the year."
Lamar's margins have sequentially improved as revenue declines have
improved, and the company enacted cost-cutting initiatives.
Excluding S&P's EBITDA adjustment for operating leases, Lamar's
third-quarter 2020 EBITDA margin was 44.2%, well above its 38%
margin in the second quarter of 2020 as revenue declines improved
to 15.7% in the third quarter from 22.5% in the second quarter.
Since the second quarter, Lamar has cut back compensation and
commission-based costs and reduced its variable lease expenses,
which decline if the company's displays aren't generating revenue.
Operating lease payments accounted for about 40% of the company's
operating expenses in 2019. S&P believes Lamar has renegotiated the
payment terms with its billboard landowners to reduce or defer a
small percentage of its required payments in 2020.
S&P said, "We expect future deleveraging will depend mostly on
EBITDA growth. As Lamar's operating performance recovers from the
recession, we expect the company will return to using most of its
cash flow to fund shareholder distributions, digital billboard
conversions, and acquisitions. As a REIT, the company is required
to distribute 90% of its taxable REIT income to its shareholders.
Although the company had the flexibility to cut its dividend in
half during the pandemic, we expect it will increase its dividend
toward its prepandemic level as the business recovers. And though
the company reduced its growth capital expenditures (capex) and
acquisition activity in 2020 because of the pandemic and recession,
we expect the company will allocate more cash toward each in
2021."
In 2020, Lamar refinanced its entire capital structure through a
series of transactions. These transactions provided the company
with significant interest cost savings and pushed out maturities as
well as removed all mandatory amortization payments. This provided
the company with more financial flexibility; however, it removed
any requirement to pay down its outstanding debt balance through
contractual amortization payments. S&P expects Lamar will use any
future voluntary debt payment to partially pay down any outstanding
revolver draws used to fund acquisitions.
S&P said, "The stable outlook reflects our expectation that outdoor
advertising spending in Lamar's markets will gradually recover over
the course of 2021, and the company will maintain leverage in the
4.5x-5x range."
"We could lower our rating on Lamar if we expect its leverage to
increase above 5.5x in 2021 and remain elevated. This could occur
if spikes in coronavirus cases cause additional stay-at-home orders
in Lamar's markets and vaccine distribution efforts stall, and
Lamar is unable to sufficiently reduce its cost base to adequately
offset the decline in its revenue."
"We could raise our rating on Lamar if we expect its leverage to
decrease and remain below 4.5x on a sustained basis. This could
occur if the company's EBITDA generation returns near prepandemic
levels at its current outstanding adjusted debt balance, which
occurs in 2022 in our base-case scenario."
LE TOTE: Reaches HBC Deal; Unsecureds to Recover 8%
---------------------------------------------------
Le Tote, Inc., et al., submitted an Amended Joint Chapter 11 Plan
and a corresponding Disclosure Statement on Dec. 21, 2020.
A hearing on the Amended Disclosure Statement is scheduled for Feb.
2, 2021 at 11:00 a.m. at Judge Phillips' Courtroom, 701 E. Broad
St., Rm. 5100, Richmond, Virginia. (Williams, Jeremy). The hearing
was previously scheduled for Jan. 7 but was reset to Feb. 2 at the
behest of the parties.
The Plan achieves an orderly wind-down of the Debtors' estates that
maximizes the value of all estate assets, including the Debtors'
remaining inventory and certain potential litigation assets
stemming from the 2019 acquisition (the "Acquisition") of Lord &
Taylor LLC from HBC US Holdings Inc. ("HBC Holdings"), a subsidiary
of Hudson's Bay Company ULC (f/k/a Hudson's Bay Company) ("HBC"),
and HBC US Propco Holdings LLC ("HBC Propco" and together with HBC
Holdings and Hudson's Bay, the "HBC Parties"), a subsidiary of HBC
Holdings, and certain post-Acquisition transactions, and certain
other litigation claims.
The Plan is the culmination of more than six months of successful
going-out-of-business sales, asset sales outside of the ordinary
course business, investigations and related diligence into the
Debtors' assets by the Debtors' independent directors and their
advisors, and approximately three months of hard-fought
post-petition negotiations with HBC. Importantly, the proposed
Plan incorporates an integrated settlement of claims and causes of
action among the Debtors and HBC. Through this settlement, the
Plan provides the ability of the Debtors to satisfy administrative
and priority claims in full and to make a significant distribution
to unsecured creditors who likely otherwise would receive minimal
and substantially delayed, if any, recovery.
On Dec. 10, 2020, following an investigation of potential claims,
estate causes of action, the Debtors and HBC parties reached an
agreement in principle on a proposed settlement of certain claims,
causes of action and challenges against the HBC Parties. The Plan
provides this value by settling estate claims and causes of action
against HBC Holdings and HBC Propco on account of the Acquisition
and the parties' subsequent business dealings and other potential
claims arising on or before the effective date of the Plan (the
"HBC Settlement"), the terms of which are encompassed in the term
sheet attached to the Disclosure Statement. In exchange, the HBC
Parties have, among other things, agreed to subordinate their
secured claims under their seller note to administrative and
priority claims and split recoveries on account of the Debtors'
remaining assets with unsecured creditors. The HBC Parties have
also agreed to provide key operational support, enabling the
Debtors to extend their store-closing sales and deliver additional
value. Finally, the HBC Parties have consented to the disallowance
of certain rejection damages claims on account of a master lease
held by an affiliate of the HBC Parties and to certain pricing
reductions for the Debtors' critical transition services agreement
with certain of the HBC Parties. The HBC Settlement provides the
Debtors a path forward to exit these chapter 11 cases while
delivering significant value to unsecured creditors -- an outcome
that would be fraught with significant uncertainty and litigation
risk, and likely not achievable at all, absent the HBC Settlement.
The official committee of unsecured creditors (the "Committee")
disagrees and believes that the HBC Settlement falls below the
lowest point in the range of reasonableness. The Committee has
said it will file an objection to the HBC Settlement. The Court
will also consider the HBC Settlement at the Feb. 2 hearing.
The Plan provides the following recoveries to stakeholders:
* Administrative Claims and other Priority Claims will be paid
in full in cash or otherwise unimpaired except to the extent that
an individual holder agrees to less favorable treatment.
* Allowed Other Secured Claims will receive, at the election of
the Debtors: (a) payment in full in Cash; (b) the Collateral
securing such Allowed Other Secured Claim; (c) reinstatement of
such Allowed Other Secured Claim; or (d) such other treatment
rendering such Allowed Other Secured Claim Unimpaired.
* Holders of the Seller Note Secured Claim and General Unsecured
Claims will receive their pro rata share of Distributable Cash
pursuant to the Waterfall Recovery. The Waterfall Recovery
establishes the following recoveries following payment in full of
Administrative Claims (other than the TSA Shortfall Claim) and
Priority Claims:
-- Distributable Cash other than Urban Proceeds is allocated
as follows: (i) first, to holders of the TSA Shortfall Claim; (ii)
second, to holders of the Seller Note Secured Claim, until such
holders receive $8 million on account of the Seller Note Secured
Claim; (iii) third, to holders of Allowed General Unsecured Claims,
until such holders have received $3 million on account of such
claims; (iv) fourth, split 50/50 between holders of the Seller Note
Secured Claim and the holders of Allowed General Unsecured Claims
until the Seller Note Secured Claim is paid in full; and (v) fifth,
to the holders of Allowed General Unsecured Claims.
-- The Urban Proceeds are allocated as follows: (i) first to
holders of Allowed General Unsecured Claims until such holders have
received $1 million on account of the Allowed General Unsecured
Claims; (ii) second, split 50/50 between holders of the Seller Note
Secured Claim and holders of Allowed General Unsecured Claims; and
(iii) third, to holders of Allowed General Unsecured Claims.
The Plan maximizes creditor recoveries, provides the Debtors a path
forward to quickly and efficiently complete the chapter 11 cases
while extending their store closing sales to further increase
recoveries, and has the support of the HBC Parties and the Debtors'
independent directors. The Debtors encourage you to vote to accept
the Plan.
Class 4 General Unsecured Claims totaling $82.8 million and will
recover 8% of their claims. Except to the extent that a Holder of
an Allowed General Unsecured Claim agrees to less favorable
treatment, in full and final satisfaction, compromise, settlement,
and release of and in exchange for each Allowed General Unsecured
Claim, each Holder of an Allowed General Unsecured Claim shall
receive its pro rata share of the Distributable Cash allocated to
Allowed General Unsecured Claims, if any, pursuant to the Waterfall
Recovery. The projected recovery to holders of Class 4 General
Unsecured Claims does not include potential recoveries on account
of proceeds of the litigation against Urban Outfitters, the value
of which is not yet determined but the Debtors believe to be
significant.
A full-text copy of the Disclosure Statement dated Dec. 21, 2020,
is available at https://bit.ly/2Kqudtx from PacerMonitor.com at no
charge.
Co-Counsel to the Debtors:
Steven N. Serajeddini, 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
- and -
David L. Eaton
Jaimie Fedell
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle Street
Chicago, Illinois 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
Co-Counsel to the Debtors:
Michael A. Condyles
Peter J. Barrett
Brian H. Richardson
KUTAK ROCK LLP
901 East Byrd Street, Suite 1000
Richmond, Virginia 23219-4071
Telephone: (804) 644-1700
Facsimile: (804) 783-6192
About Le Tote Inc.
Le Tote, Inc. and its affiliates operate both an online,
subscription-based clothing rental service and a full-service
fashion retailer with 38 brick-and-mortar locations and a robust
e-commerce platform. In response to the COVID-19 pandemic, Le Tote
temporarily closed all retail locations in March 2020, although
they continue to operate the Le Tote and Lord & Taylor Web sites.
Le Tote and its affiliates sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. 20-33332) on
Aug. 2, 2020. At the time of the filing, the Debtors disclosed
assets of between $100 million and $500 million and liabilities of
the same range.
The Debtors have tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as their legal counsel, Kutak Rock LLP as local
counsel, Berkeley Research LLC as financial advisor, and Nfluence
Partners as investment banker. Stretto is the notice, claims and
balloting agent and administrative advisor.
LE TOTE: Wilmington Trust to Raise Objections at Confirmation
-------------------------------------------------------------
Wilmington Trust, National Association, as Trustee in Trust for
Holders of Hudson's Bay Simon JV Trust 2015-HBS, Commercial
Mortgage Pass-Through Certificates, Series 2015-HBS, acting by and
through Situs Holdings, LLC, its Special Servicer, filed on Dec.
31, 2020, its reservation of rights with respect to approval of the
Amended Disclosure Statement for the Joint Chapter 11 Plan of Le
Tote, Inc. and its Debtor Affiliates.
Certain material defects in the Amended Plan (which, along with the
Amended Disclosure Statement, was filed just 10 days before the
current objection deadline) will prevent confirmation thereof in
its current form. However, the Trust believes those issues are
more appropriately addressed in connection with confirmation,
particularly where further amendments of the Amended Plan are a
near certainty. Accordingly, the Trust reserves the right to
object to confirmation of the Amended Plan, or any other plan
proposed in these Chapter 11 cases, along with any other or
further amended disclosure statement filed in connection therewith,
each including all amendments, supplements, exhibits, schedules, or
other documents filed in connection therewith, on any grounds
whatsoever.
The Trust is the holder of an $846,229,966 commercial
mortgage-backed securities loan made to, among others, twenty-four
non-debtor landlords of debtor Lord & Taylor LLC. L&T pays all
rents and other sums due to the L&T Landlords under a single,
unitary master lease. The Master Lease serves as collateral for the
Loan.
In addition to its other obligations under the Master Lease, L&T is
required to pay both fixed rent and additional rent on a monthly
basis. Monthly fixed rent installments under the Master Lease are
presently $5,405,672 per month. L&T has not paid any postpetition
rent since the commencement of the Chapter 11 Cases, even after the
temporary rent deferral approved by the Court expired on Oct. 1,
2020.
In its objection to the Original Disclosure Statement, Wilmington
Trust pointed out that the existing Plan and Disclosure Statement
appear to have been filed solely as placeholders at the outset of
the Chapter 11 Cases. As a result, the Disclosure Statement omits
substantially all of the material events that have occurred
throughout the Chapter 11 cases and does not adequately describe
the proposed path forward for the Debtors' estates.
Counsel for Wilmington Trust:
Andrew Behlmann
Colleen Maker
LOWENSTEIN SANDLER LLP
One Lowenstein Drive
Roseland, New Jersey 07068
Telephone: (973) 597-2500
Facsimile: (973) 597-2400
- and -
Paul A. Driscoll
ZEMANIAN LAW GROUP
223 East City Hall Avenue, Suite 201
Norfolk, Virginia 23510
Telephone: (757) 622-0090
Facsimile: (757) 622-0090
About Le Tote Inc.
Le Tote, Inc. and its affiliates operate both an online,
subscription-based clothing rental service and a full-service
fashion retailer with 38 brick-and-mortar locations and a robust
e-commerce platform. In response to the COVID-19 pandemic, Le Tote
temporarily closed all retail locations in March 2020, although
they continue to operate the Le Tote and Lord & Taylor websites.
Le Tote and its affiliates sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. 20-33332) on
Aug. 2, 2020. At the time of the filing, Debtors disclosed assets
of between $100 million and $500 million and liabilities of the
same range.
The Debtors have tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as their legal counsel, Kutak Rock LLP as local
counsel, Berkeley Research LLC as financial advisor, and Nfluence
Partners as investment banker. Stretto is the notice, claims and
balloting agent and administrative advisor.
LIDDLE & ROBINSON: Unsecureds to Recover Up to 2% in Trustee Plan
-----------------------------------------------------------------
Jonathan L. Flaxer, the chapter 11 trustee for the bankruptcy
estate of Liddle & Robinson, L.L.P., filed a Chapter 11 Plan and a
Disclosure Statement for the resolution of claims against the
Debtor's estate.
Throughout the Debtor's Chapter 11 Case, the Trustee has monetized
assets for the benefit of the Estate, including collecting
outstanding fees owes by then-current and former clients of the
Debtor. As of Nov. 30, 2020, the Estate holds approximately
$268,400.
The Plan is built around a compromise and settlement of the
disputes between the Estate and Counsel Financial, the Debtor's
secured creditor. As part of this settlement, under the Plan, the
Estate and Counsel Financial agree on the treatment of Counsel
Financial's secured claims as well as their alleged "diminution in
value" claim. The Trustee believes that the Plan is a reasonable
compromise and settlement of the disputes concerning the value of
Counsel Financial's collateral with respect to its claims.
Class 1 Allowed Counsel Financial Secured Claims are impaired.
Class 1 will recover 13% to 35% of the claims. With respect to the
Allowed CFII Secured Claim, CFII shall receive (i) the amount of
$1,226,611; provided, however, that the Adequate Protection Payment
shall credited against this amount, plus (ii) the Fee Share
attributable to any Fee Amounts paid to the Debtor or Liquidating
Debtor, as applicable. With respect to the Allowed LIG Secured
Claim and Allowed CFH Secured Claim, upon the payment in full of
the Allowed CFII Claim, the Fee Share attributable to any Fee
Amounts paid to the Debtor or Liquidating Debtor, as applicable.
If each of the Allowed CFII Claim, Allowed LIG Claim, and Allowed
CFH Claim is paid in full, then the Fee Share attributable to any
Fee Amounts paid to the Debtor or Liquidating Debtor, as
applicable, subsequent to the Effective Date.
Class 3 General Unsecured Claims in the amount of $33,193,000 will
recover 0% to 2%. Holders of Allowed General Unsecured Claims will
receive a pro rata share of the Cash in the Post Confirmation Fund
after payment in full of Allowed Administrative Claims, Allowed
Priority Claims, Allowed Priority Tax Claims, funding of Reserves,
and payment of United States Trustee fees (including Quarterly
Trustee Fees), and payments, if any, with respect to the Allowed
Counsel Financial Secured Claims in accordance with Section 4.2 of
the Plan.
Class 4 Partnership Interests are impaired. Holders of Partnership
Interests shall neither receive nor retain any property under the
Plan. Partnership Interests shall be cancelled effective upon
entry of a Final Order closing the Chapter 11 Case.
On the Effective Date, all Property of the Estate, including Claims
and causes of action, whether or not an action or proceeding has
been commenced with respect thereto, that have not been assigned to
Counsel Financial pursuant to the Plan, shall vest in the
Liquidating Debtor in accordance with section 1141 of the
Bankruptcy Code, subject to the Allowed Counsel Financial Secured
Claims as set forth in the Plan.
A full-text copy of the Disclosure Statement dated Dec. 14, 2020,
is available at https://bit.ly/3nSysw4 from PacerMonitor.com at no
charge.
Counsel to Chapter 11 Trustee Jonathan L. Flaxer:
Michael S. Weinstein, Esq.
GOLENBOCK EISEMAN ASSOR BELL & PESKOE LLP
711 Third Avenue
New York, New York 10017
(212) 907-7300
About Liddle & Robinson
Liddle & Robinson, LLP -- http://liddlerobinson.com/-- provides
legal representation primarily to individuals but also to financial
services firms, hedge funds and other businesses in high-stakes,
cutting-edge employment, securities and commercial litigation
matters.
Liddle & Robinson sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 19-12346) on July 22,
2019. The case is jointly administered with the Chapter 11 case of
Jeffrey Lew Liddle (Bankr. S.D.N.Y. Case No. 19-10747) filed on
March 11, 2019. Judge Sean H. Lane oversees both cases.
At the time of the filing, Liddle & Robinson had estimated assets
of between $1 million and $10 million and liabilities of between
$10 million and $50 million. Foley Hoag LLP is the Debtor's legal
counsel.
Jonathan Flaxer was appointed as the Debtor's Chapter 11 trustee.
The Trustee is represented by Golenbock Eiseman Assor Bell & Peskoe
LLP.
MARRONE BIO: Van Herk Exercises 33.3% of Outstanding Warrants
-------------------------------------------------------------
Effective Dec. 29, 2020, an amendment was made to a prior warrant
agreement with Van Herk Investments that extends the maturities of
its existing warrants. As a result, Van Herk exercised 33.3% of
its outstanding warrants, reducing the total number of its
outstanding warrants, and providing $1.7 million in funds to
Marrone Bio Innovations, Inc.
"With this warrant amendment, our prior warrant restructurings and
recent warrant exercises and expirations, only 27.6% percent of the
total warrants outstanding at the beginning of 2020 are currently
outstanding. Assuming full cash exercise of remaining warrants
from our restructuring transactions, we would receive $6.2 million
in the first quarter and $5.5 million in the fourth quarter of
2021," said chief executive officer Kevin Helash. "Our warrant
overhang will be essentially removed by the end of this year."
"These warrant transactions have provided financial and timing
flexibility to the company that allows us to pursue strategic
alternatives to strengthen our position as the leader in
agricultural biological solutions," Helash added.
About Marrone Bio Innovations
Based in Davis, California, Marrone Bio Innovations, Inc. --
http://www.marronebio.com-- discovers, develops and sells
innovative biological products for crop protection, plant health
and waterway systems treatment. MBI has screened over 18,000
microorganisms and 350 plant extracts, leveraging its in-depth
knowledge of plant and soil microbiomes enhanced by advanced
molecular technologies to rapidly develop seven effective and
environmentally responsible pest management products to help
customers operate more sustainably while uniquely improving plant
health and increasing crop yields. Supported by a robust portfolio
of over 400 issued and pending patents around its natural product
chemistry, MBI's currently available commercial products are
Regalia, Grandevo, Venerate, Majestene, Haven Stargus and
Amplitude, Zelto and Zequanox.
Marrone Bio reported a net loss of $37.17 million for the year
ended Dec. 31, 2019, compared to a net loss of $20.21 million for
the year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company
had $72.06 million in total assets, $48.96 million in total
liabilities, and $23.10 million in total stockholders' equity.
Marcum LLP, in San Francisco, CA, the Company's auditor since 2018,
issued a "going concern" qualification in its report dated March
16, 2020 citing that the Company 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.
MDC HOLDINGS: Moody's Rates New $300MM Notes Due 2031 'Ba1'
-----------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to M.D.C. Holdings,
Inc.'s proposed $300 million notes due 2031. M.D.C.'s other ratings
and stable outlook remain unchanged. The Speculative-Grade
Liquidity rating also remains unchanged at SGL-2. The proceeds of
the new notes will be used for general corporate purposes. The
immediate impact of the transaction will result in an increase to
M.D.C.'s adjusted homebuilding debt-to-capitalization to 45.1% on a
pro forma basis as of September 30, 2020, from 35.3%. M.D.C. has a
meaningful backlog of sold homes going into 2021 in excess of 6,500
units and Moody's forecasts total annual sales of over 10,000
units, which will result in deleveraging through earnings growth.
Moody's expects leverage to decline to 33.8% by year-end 2021,
which is modestly higher than our prior projection of 30.8%.
Assignments:
Issuer: M.D.C. Holdings, Inc.
Senior Unsecured Notes, Assigned Ba1 (LGD4)
RATINGS RATIONALE
M.D.C.'s Ba1 Corporate Family Rating reflects the company's success
at reducing land impairment risk through its build-to-order
strategy and history of moderate land supply. In addition, M.D.C.
has a diverse geographic footprint and growing presence in
affordable product offerings, a category experiencing stronger
demand as affordability issues persist. Demand for new
single-family housing across all product categories has increased
as a result of the COVID-19 pandemic, with families seeking to
relocate to suburban areas with more personal space as they spend
more time at home. These factors are offset by rising land, labor
and materials costs which can place downward pressure on the
company's gross margin. In addition, the homebuilding industry is
highly cyclical and could lead to protracted revenue declines in a
downturn.
M.D.C.'s proposed and existing senior notes are unsecured and the
credits have the same priority of claim as M.D.C.'s unsecured
revolving credit facility. The Ba1 ratings assigned to the senior
unsecured notes, at the same level with the CFR, reflects that this
class of debt represents the preponderance of debt in the capital
structure.
Moody's expects M.D.C. to maintain good liquidity over the next 12
to 18 months. In addition to $503 million of unrestricted cash at
September 30, 2020, the company has almost full availability on its
newly expanded $1.2 billion senior unsecured revolver.
Approximately $1.125 billion of facility commitments have been
extended to December 2025, with the remaining commitment continuing
to expire December 2023. The revolver has an accordion feature that
permits M.D.C. to increase the commitment to $1.7 billion.
M.D.C.'s governance risk is low and reflects the maintenance of a
conservative financial policy, with no joint ventures or
off-balance sheet recourse obligations, as well as low financial
leverage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if M.D.C. demonstrates maintenance of
strong credit metrics, including homebuilding debt to book
capitalization below 35% and EBIT interest coverage in the high
single digits on a sustained basis. An upgrade would also require
maintenance of a very good liquidity profile, including strong free
cash flow generation. Finally, an upgrade would require a
meaningful increase in size and scale while maintaining its
conservative financial policy and demonstrating a commitment to
attaining and maintaining an investment grade rating, both to
Moody's and to the debt capital markets. The ratings could be
downgraded if M.D.C. shifts to a more aggressive financial policy
or if operating results decline such that debt leverage approaches
45%, EBIT interest coverage declines below 5x or liquidity
weakens.
The principal methodology used in these ratings was Homebuilding
And Property Development Industry published in January 2018.
Founded in 1972 and headquartered in Denver, CO, M.D.C. Holdings,
Inc. is a mid-sized national homebuilder that builds and sells
primarily single family detached homes to first time and first time
move up buyers under the name "Richmond American Homes". The
homebuilding divisions operate across three regions, including the
states of Arizona, California, Nevada, Washington, Oregon,
Colorado, Utah, Virginia, Maryland, and Florida. For the 12 month
period ended September 30, 2020, the company's revenue and net
income were approximately $3.8 billion and $313 million,
respectively.
MDC HOLDINGS: S&P Rates New $300MM Senior Unsecured Notes 'BB+'
---------------------------------------------------------------
S&P Global Ratings assigned its 'BB+' issue-level and '3' recovery
ratings to MDC Holdings Inc.'s proposed $300 million senior
unsecured notes due 2031. The '3' recovery rating indicates S&P's
expectation for meaningful (50%-70%; rounded estimate: 60%)
recovery in the event of a payment default. S&P expects the company
to use the proceeds from this issuance for general corporate
purposes.
MEDASSETS SOFTWARE: Fitch Assigns First-Time 'B' LongTerm IDR
-------------------------------------------------------------
Fitch Ratings has assigned a Long-Term Issuer Default Rating (IDR)
of 'B' with a Stable Outlook to MedAssets Software Intermediate
Holdings, Inc. (nThrive TSG). Fitch has also assigned a senior
secured first-lien term loan rating of 'BB'/'RR1'. Fitch's actions
affect approximately $440 million of to-be-issued debt. A complete
list of rating actions follows at the end of this release.
nThrive TSG is a provider of revenue cycle management (RCM)
software and services, defined as the administrative and clinical
functions that contribute to the capture, management, and
collection of patient service revenue. The company provides its
offerings in charge integrity, claims management, contract
management, patient access, analytics and education through a
cloud-hosted, multi-tenant software-as-a-service ("SaaS") platform.
On Nov. 15, 2020, nThrive TSG entered into a definitive agreement
to be acquired by Clearlake Capital Group, L.P. (Clearlake). Total
purchase price of $1.115 billion represents approximately 12.1x LTM
Sept. 30, 2020 pro forma adjusted EBITDA. Clearlake is an
investment firm founded in 2006 operating across private equity and
credit strategies with experience in the healthcare IT software
sector.
KEY RATING DRIVERS
Reliable Growth Trajectory: Fitch expects nThrive TSG to experience
consistent midsingle-digit organic growth through the forecast
horizon as a result of strong secular trends in U.S. healthcare
spending and utilization. The Centers for Medicare and Medicaid
Services (CMS) forecasts national health expenditure growth of 5.6%
per year through 2026 due to long-standing trends including an
aging demographic, medical procedure/drug-cost inflation and
utilization growth. In addition, increased regulatory burdens,
claims processing complexity and pressures on provider
profitability serve as strong tailwinds for continued software
adoption by providers.
The company's growth prospects are further reinforced by strong
retention rates that are supported by high switching costs that
involve staff retraining, implementation costs, business
interruption risks and reduced productivity when swapping vendors.
Despite the strong tailwinds, Fitch expects growth to be somewhat
limited relative to peers due to a fully penetrated end-market with
cross-sell efforts as the primary mechanism for future growth.
Fitch believes that the secular tailwinds and high switching costs
produce a dependable growth trajectory that benefits the credit
profile.
Low Cyclicality: Fitch expects nThrive TSG, which has maintained
consistent growth though the current pandemic driven macro
downturn, to continue to exhibit low cyclicality for the
foreseeable future. Fitch believes the company will exhibit strong
correlation to overall U.S. healthcare spend and utilization, which
is highly non-discretionary and has experienced uninterrupted
growth since at least 2000 according to CMS. As a result, Fitch
believes the company will demonstrate a stable credit profile with
little sensitivity to macroeconomic cycles.
Strong Recurring Revenue and Margin Profile: nThrive TSG's software
offerings are delivered through a multi-tenant, single-instance
cloud platform with 92% of revenue generated from
subscription-based revenue and annual recurring revenue (ARR)
predominantly comprised of fixed-fee products. The high degree of
recurring revenue promotes visibility and is further supported by
99% gross retention rates.
nThrive TSG's profitability compares well to peers with Fitch
forecasting EBITDA margins of 41 - 42% over the ratings horizon,
above the 32% average and near the top of the 13%-45% range for
Fitch-rated HCIT peers. The strong margin profile is supported by a
highly variable cost structure typical of software developers.
Fitch believes the strong margins contribute to robust FCF
potential and supports the ability to sustain elevated leverage.
High Leverage: nThrive TSG is being acquired by PE sponsor,
Clearlake, in a deal valued at $1.1 billion, financed with $750
million of new debt, including a $150 million preferred equity
issuance, and the balance provided by an equity contribution from
the sponsor. Fitch calculates initial pro forma leverage of 7.9x,
well above the 6.25x and 5.6x median for Technology issuers in the
'B' category and for Fitch-rated healthcare IT issuers,
respectively. Fitch expects modest deleveraging due to the limited
EBITDA growth opportunity with margins that already benchmark well
relative to peers, forecasts for midsingle-digit revenue growth,
and the PE ownership that is unlikely to promote voluntary debt
repayment. As a result, Fitch forecasts minimal decline in leverage
to 7.7x over the ratings horizon. However, Fitch believes the
leverage is supported by the company's dependable growth prospects,
strong margin profile, declining capital intensity, and low
cyclicality.
Strategic Risks: Fitch believes nThrive TSG faces elevated risks in
the pending transaction that seeks to carve out and separate the
unit from the prior company, given the complexity and execution
demands such a process typically creates. Management has taken
several steps to mitigate this risk including, the separation of
sales, marketing and G&A functions completed in early 2020,
retention of all IT assets and vendor contracts, and the
implementation of a TSA with the remaining company that promotes
continuity.
Fitch also notes risk in the company's sales strategy targeting
large hospital system customers with growth reliant primarily on
cross-selling efforts with existing clients, followed by new logo
growth. The go-to-market strategy positions nThrive in direct
competition with larger RCM providers, such as Change Healthcare,
Inc. and Experian Information Solutions, Inc., who could quickly
scale up product investment and go-to-market efforts. In addition,
large Electronic Health Records (EHR) providers, such as EPIC or
Virence, which was combined with athenahealth, Inc. in 2019, are
thoroughly entrenched in hospital IT systems and may leverage their
position and vertically integrate their software stack by expanding
RCM capabilities. This risk is somewhat mitigated by the
substantial switching costs involved in replacing an RCM vendor,
evidenced by the company's historical retention rates near 100%.
Evolving Marketplace: nThrive TSG faces risks from a continually
evolving healthcare marketplace including consolidation in large
hospital systems and impacts from ongoing efforts to slow cost
growth. Long-standing profitability pressures on hospitals has led
to rising M&A activity as large systems combine or absorb smaller,
independent hospitals. The trend may limit growth prospects as the
target set of customers narrows, with Deloitte forecasting a 50%
decline in existing systems by 2024, or may lead to increased churn
as newly merged providers rationalize software platforms.
Additionally, nascent efforts to shift to value-based care, in
which reimbursements are directed toward successful outcomes rather
than toward volume of procedures, will likely require the company
to re-examine its current go-to-market and pricing strategies.
nThrive TSG will need to develop a pricing strategy that aligns
more closely with the emerging incentives that are based on medical
outcomes. Fitch believes that such a major shift in pricing
strategy introduces a risk of disruption and rejection from the
marketplace that may result in decreased growth. However, Fitch
notes that the transition to value-based case is also slow-moving
and any impacts are outside of the ratings horizon.
DERIVATION SUMMARY
Fitch is evaluating nThive TSG pending its transaction to be
acquired by private equity sponsor, Clearlake Capital. Fitch
believes the company benefits from a favorable growth opportunity
as processing volumes continue to expand due to long-standing
trends in the US healthcare industry including, an aging
demographic, medical procedure/drug cost inflation and utilization
growth. In addition, the company exhibits strong revenue growth
prospects by leveraging its platform that addresses the increased
regulatory burdens, claims processing complexity and profitability
pressures to generate significant cross-selling opportunities in
the existing client base. Fitch believes growth is further ensured
by a high degree of recurring revenue, strong client-retention
rates, high switching costs and robust sales efforts. Finally,
similar to the company's continued positive organic growth during
the pandemic-led downturn, Fitch expects the company to demonstrate
minimal cyclicality and durable resistance to economic cycles due
to the non-discretionary nature of healthcare spend.
While Fitch views the high visibility into revenue growth
positively, the company's prospects are partially limited relative
to HCIT peers given the company's target market in the large
hospital system segment that is characterized by a fully penetrated
client base, a rapidly consolidating set of potential customers,
larger scale competitors, and entrenched EHR software providers
that may seek to expand RCM offerings over time.
The company scores positively on profitability metrics with Fitch
forecasting EBITDA margins of 41%-42% over the ratings horizon,
which compares well to the 32% average and is near the top of the
13%-45% range for Fitch-rated HCIT peers. Fitch also expects
consistent FCF margins in the mid-teens over the forecast horizon
due to strong EBITDA margins, significant tax shields and declining
capital intensity as the company completes certain growth
investments in product and infrastructure. Fitch believes strong
FCF will be sustainable due the low cyclicality of the business, a
rapid cash conversion cycle and low capital intensity.
Despite these attractive characteristics, Fitch calculated pro
forma leverage of 7.9x is materially higher than the 6.25x median
for Technology issuers in the 'B' ratings category. Fitch expects a
moderate decrease in leverage to 7.7x over the ratings horizon as
private equity ownership and a constrained EBITDA growth profile
likely limit further deleveraging. Fitch views leverage as the
primary determinant of the 'B' rating. No country-ceiling,
parent/subsidiary or operating environment aspects had an impact on
the rating. Fitch applied its Hybrid criteria to the expected
issuance of preferred equity as part of the transaction and
determined that no equity credit should be assigned.
KEY RECOVERY RATING ASSUMPTIONS
-- The recovery analysis assumes that nThrive TSH would be
reorganized as a going-concern in bankruptcy rather than
liquidated.
-- Fitch has assumed a 10% administrative claim.
Going-Concern (GC) Approach
-- The GC EBITDA estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which Fitch bases the
enterprise valuation (EV). Fitch contemplates a scenario in
which elevated competition from larger RCM providers results
in increased client churn and decreased revenue growth, as
well as increased sales and R&D expenses to address the
challenges. As a result, Fitch expects that nThrive TSG would
likely be reorganized with a similar product strategy and
higher than planned levels of operating expenses as the
company reinvests to ensure customer retention and defend
against competition.
-- Under this scenario, Fitch believes EBITDA margins would
decline such that the resulting going-concern EBITDA is
approximately 15% below September 2020 LTM EBITDA.
-- An EV multiple of 7x EBITDA is applied to the GC EBITDA to
calculate a post-reorganization enterprise value. The choice
of this multiple considered the following factors:
Comparable Reorganizations: In Fitch's 13th edition of its
"Bankruptcy Enterprise Values and Creditor Recoveries" case study,
the agency notes seven past reorganizations in the technology
sector, where the median recovery multiple was 4.9x. Of these
companies, only two were in the software subsector: Allen Systems
Group, Inc. and Aspect Software Parent, Inc., which received
recovery multiples of 8.4x and 5.5x, respectively. Fitch believes
the Allen Systems Group, Inc. reorganization is highly supportive
of the 7.0x multiple assumed for Waystar given the mission critical
nature of both companies' offerings.
M&A Precedent Transaction: A study of M&A in the healthcare IT
industry from 2010 to 2017 that included an examination of 35
transactions involving RCM providers established a median EV/EBITDA
transaction multiple of 15.5x. More recent comparable M&A such as
the buyouts of athenahealth, Waystar and eSolutions continue to
support similar transaction multiples.
Fitch evaluated a number of qualitative and quantitative factors
that are likely to influence the GC valuation:
-- 1) Secular trends and regulatory environment are highly
supportive as increased regulatory burdens, claims
processing complexity and reimbursement pressures promote
demand growth;
-- 2) Barriers to entry are high relative to software issuers as
deep domain and regulatory expertise are required to
develop solutions for automated claims processing;
-- 3) nThrive is a top five RCM software provider to large
hospital systems but is still of significantly smaller
scale than certain competitors such as Change Healthcare,
Inc. and Experian Information Solutions, Inc.;
-- 4) Revenue and cash flow outlook is favorable as long-standing
secular trends in health expenditures are supportive of
revenue growth while strong profitability and low capital
intensity promote FCF margins in the mid-teens;
-- 5) Revenue certainty is high as a result of the 92% recurring
revenue profile;
-- 6) EBITDA margins are near the top of the 13%-45% range for
Fitch-rated HCIT peers; and
-- 7) Operating leverage is durable given a highly variable cost
structure typical of software developers. Fitch believes
these factors reflect a particularly attractive business
model that is likely to generate significant interest,
resulting in a recovery multiple at the high-end of Fitch's
range.
The recovery model implies a 'BB' and 'RR1' Recovery Rating for the
company's first-lien senior secured facilities, reflecting Fitch's
belief that lenders should expect to recover 91% or greater in a
restructuring scenario.
HYBRIDS TREATMENT
As part of the financing package for Clearlake's buyout of nThrive
TSG, the company expects to issue $150 million of preferred equity
to an unaffiliated investor. The entity incurring the obligation
has not been determined, but is expected to be outside the
restricted group. The preliminary terms of the preferred equity
include a provision that would trigger mandatory redemption in the
event of an acceleration under the first or second lien credit
facilities. Under Fitch's hybrid criteria, any cross-acceleration
clause would result in no equity credit. Fitch has thus determined
to treat the preferred equity as debt.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Transaction: purchase of nThrive TSG by private equity sponsor
Clearlake Capital Group completed for total consideration of
$1.15 billion, funded under the currently contemplated
financing terms including, the issuances of a $75 million
first lien undrawn RCF, a $440 million first-lien term loan, a
$160 million second-lien term loan, as well as $150 million of
preferred equity the balance provided by an equity
contribution from the sponsor;
-- Revenue: growth of 4.9% in 2020, consistent with YTD results;
growth of 5%-5.5 % per year thereafter, due to cross selling
efforts, new logo growth and increasing medical procedure
volumes, consistent with end-market forecasts;
-- Margins: EBITDA margins of 41%-42% in 2020 - 2021 with margin
expansion of 50bp per year thereafter due to scaling
efficiencies and declines in G&A declines resulting from
operating leverage associated with infrastructure
requirements;
-- Capex: capital intensity of 12% in fiscal 2020 due to product
and infrastructure investments, gradually declining to 6.5%,
consistent with HCIT peers;
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- (Cash flow from operations - capex)/total debt with equity
credit sustained above 6.5%;
-- Reduction in debt leading to total debt with equity
credit/operating EBITDA sustained below 5.5x;
-- Revenue growth consistently in excess of Fitch's forecasts;
-- Strengthened competitive positioning and increased scale.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- (Cash flow from operations - capex)/total debt with equity
credit sustained below 5%;
-- Total debt with equity credit/operating EBITDA sustained above
7.5x;
-- Revenue declines resulting from market share losses or \
deterioration in competitive position.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Fitch expects nThrive TSG to maintain
sufficient liquidity following the transaction given moderate
operating expense requirements that result in strong margins, a
highly variable cost structure, a short cash conversion cycle due
to monthly billing, and declining capital intensity. Pro forma for
the transaction, liquidity is expected to be comprised of $5
million in cash and an undrawn $75 million revolving credit
facility (RCF). Liquidity is further supported by Fitch's forecast
for nearly $75 million in aggregate FCF over 2021-2022. Fitch
forecasts steady growth in liquidity, approaching $145 million by
2022 due to accumulation of FCF and the expectation for the RCF to
remain undrawn.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3' - ESG issues are credit
neutral or have only minimal credit impact on the entity, either
due to their nature or the way in which they are being managed by
the entity.
nThrive TSG has an ESG Relevance Score of '4' for Governance
Structure due to its ownership by private equity sponsor Clearlake
Capital, who is assumed to be heavily biased in favor of
shareholder returns.
MEXTEX OPERATING: Court OKs Changes to Disclosure Statement
-----------------------------------------------------------
On Dec. 21, 2020, the U.S. Bankruptcy Court for the Western
District of Texas held a hearing to consider approval of a
Disclosure Statement dated Nov. 12, 2020, for a Plan of
Reorganization dated Nov. 4, 2020, filed by MexTex Operating
Company, Inc.
At the hearing the Court instructed Debtor make several changes to
the Plan and Disclosure Statement which the Debtor undertook and
filed the Amended Disclosure Statement and First Amended Plan of
Liquidation on Jan. 4, 2021.
Judge H. Christopher Mott on Jan. 4, approved the Amended
Disclosure Statement and ordered a hearing to consider confirmation
of the Plan for Feb. 23, 2021 at 1:30 p.m. (CT), at the U.S.
Bankruptcy Court, Courtroom No. 2, 903 San Jacinto Blvd., Austin,
Texas. The Court will conduct the hearing via CISCO Webex
Meetings.
Feb. 2, 2021 at 5:00 p.m. (CT) is fixed, as the last day for filing
and serving written objections to confirmation of the Plan, for
submitting ballots for acceptances or rejections of the Plan.
Terms of Plan
MexTex Operating Company, Inc., submitted an Amended Disclosure
Statement.
On July 12, 2019, Rocking R and Debtor entered into a Memorandum of
Understanding (the "MOU"), whereby the Debtor agreed to transfer
all of its working interests and overriding royalty interests in
wells in Sutton County, Texas to Rocking R. Section 1.6 of the MOU
provided that the sale also included the right to operate the wells
for $200,000. Rocking R has breached its indemnification
obligations to the Debtor and has breached numerous provisions of
its purchase and sale contracts with Debtor. Rocking R claims that
if Debtor is successful in pursuing its claims, then Rocking R
would have no cash to pay out against a judgment. Based on
information and belief, Rocking R continues to pour money into the
Fort Terret Field.
MexTex urges the creditors to vote for the Plan as they strongly
believe there will be a judgment won against Rocking R.
The Plan contemplates that all secured claims will be paid in full
on the Effective Date. As for general unsecured claims asserted
against the Debtor, the Plan will create a Creditor Trust that will
receive all remaining funds on hand, which can be used to pursue
claims against Rocking R for the benefit of all general unsecured
claims.
Class 3 Allowed General Unsecured Claims are impaired. Each holder
of an Allowed General Unsecured Claim will receive an interest in
the Creditor Trust on a pro rata basis of the total amount of
Allowed General Unsecured Claims.
Class 5 Allowed Common Stock is impaired. The holders of Class 5
Common Stock will receive no distribution under the Plan.
A full-text copy of the Amended Disclosure Statement dated Jan. 4,
2021, is available at https://bit.ly/3onsnbt from PacerMonitor.com
at no charge.
A full-text copy of the Order dated Jan. 4, 2021, is available at
https://bit.ly/3omwftm from PacerMonitor.com at no charge.
Attorneys for the Debtor:
Randall A. Pulman
Thomas Rice
PULMAN, CAPPUCCIO & PULLEN, LLP
2161 NW Military Highway, Suite 400
San Antonio, Texas 78213
Tel: (210) 222-9494
Fax: (210) 892-1610
E-mail: rpulman@pulmanlaw.com
trice@pulmanlaw.com
About MexTex Operating Company
MexTex Operating Company is an Austin, Texas-based company that
provides support activities for the mining industry.
MexTex Operating Company filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No.
20-10768) on July 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 H. Christopher Mott oversees the case.
Pulman, Cappuccio & Pullen, LLP, represents Debtor.
MEXTEX OPERATING: Rocking Says Plan Disclosures Misleading
----------------------------------------------------------
Rocking R Investments, Inc., objects to the Disclosure Statement
Regarding Plan of Reorganization for MexTex Operating Company.
Rocking R points out that the Disclosure Statement does not contain
adequate information and should not be approved. It also contains
false statements, misleading statements, and statements presented
as fact that are hotly disputed. All such statement should be
removed, corrected, and/or disclaimed as being assertions as
opposed to fact.
Rocking R is likely to oppose confirmation of the Plan for multiple
reasons and reserves all its right to object to and oppose
confirmation of the Plan.
Rocking R complains that the Debtor's Plan is primarily a vehicle
for the Debtor to retain control of litigation claims it asserts it
will bring against Rocking R. As a result, the Disclosure
Statement should include an adequate description of the potential
for a favorable outcome if the Plan is confirmed and the Debtor is
permitted to pursue those claims.
Rocking R asserts that:
* The Disclosure Statement also contains false and misleading
statements that must be removed, corrected, and/or disclaimed as
being assertions as opposed to fact. For example, on page 5, the
Debtor states "MexTex had no responsibility nor any involvement in
the decisions made or actions taken regarding field operations.
* Another false statement is "For the avoidance of doubt,
Rocking R directly entered into contracts with vendors to perform
operations and services on the wells..." This statement is not just
false, it is legally impossible.
* Another oft-repeated MexTex lie must be removed from the
Disclosure Statement and the lie forever put to rest. MexTex's
allegations that Rocking R was acting on behalf of MexTex without
authority are false, as shown by months of extensive e-mail
correspondence whereby Rocking R was given express authority.
Rocking R requests that the Debtor be ordered to include a position
statement prepared by Rocking R in the Debtor's Disclosure
Statement.
Attorneys for Rocking R Investments:
Nathaniel Peter Holzer
Jordan, Holzer & Ortiz, PC
500 North Shoreline Blvd, Suite 900
Corpus Christi, TX 78401-0341
Telephone: 361.884.5678
Facsimile: 361.888.5555
E-mail: pholzer@jhwclaw.com
About MexTex Operating Company
MexTex Operating Company is an Austin, Texas-based company that
provides support activities for the mining industry.
MexTex Operating Company filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No.
20-10768) on July 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 H. Christopher Mott oversees the case.
Pulman, Cappuccio & Pullen, LLP, is the Debtor's legal counsel.
MOUNTAINEER GAS: Fitch Puts BB+ LongTerm IDR on Rating Watch Pos.
-----------------------------------------------------------------
Fitch Ratings has placed Mountaineer Gas Company's (MGC) 'BB+'
Long-Term Issuer Default Rating (IDR) and 'BBB-'/'RR1' senior
unsecured debt rating on Rating Watch Positive following an
announcement by UGI Corporation that it has entered into a
definitive agreement to acquire Mountaintop Energy Holdings LLC,
owner of MGC. The transaction has an enterprise value of $540
million, which includes the assumption of $140 million of privately
placed debt. The acquisition is expected to close in 2H21, subject
to the necessary regulatory approvals, including that of the Public
Service Commission of West Virginia (WVPSC).
Fitch views UGI Corporation's acquisition of MGC as a credit
positive for MGC due to the elimination of credit quality
constraints associated with MGC's current private equity ownership,
along with the benefits associated with joining a larger natural
gas utility family. Fitch also projects MGC's leverage metrics to
remain strong enough to support a higher rating. This acquisition
aligns MGC's interests with those of UGI in regards to natural gas
growth investments, highlighted by further enhancing the pipe
replacement program currently in motion by MGC.
Fitch would look to resolve the Rating Watch Positive upon the
closing of the acquisition. MGC's ratings could be upgraded one or
two notches, pending further clarity of the company's financial
profile post-acquisition. Fitch notes that West Virginia's
challenging regulatory environment limits the upward rating
trajectory. The WVPSC does not currently allow revenue decoupling
or weather normalization, leading to potential volatile credit
metrics, and use of a historical test year results in regulatory
lag and lower earned ROEs.
MGC's current ratings primarily reflect the utility's small scale
of operations, private equity ownership and a challenging
regulatory environment in West Virginia. MGC's ongoing pipe
replacement program will keep capex elevated throughout the
forecast period. Fitch considers the infrastructure replacement and
expansion program (IREP) cost-recovery rider to be credit positive
as it partly alleviates regulatory lag.
KEY RATING DRIVERS
Private Equity Ownership: MGC's ratings are restricted by the
utility's private equity ownership. MGC's holding company,
Mountaineer Gas Holdings Limited Partnership (MGH), is owned by
private equity funds ultimately owned by iCON Infrastructure LLP,
and IGS Utilities LLC (IGS LLC). Fitch considers private equity
ownership to present an increased level of credit risk due to the
typically more aggressive dividend payout policy, weaker financial
flexibility, and less transparent corporate governance compared
with a publicly traded company. However, MGC's owners have provided
support through equity infusions and a lower dividend payout as the
utility undergoes its large capex plan.
After UGI Corporation completes the acquisition, Fitch expects MGC
to benefit from being part of a larger utility and energy family.
UGI Corporation's natural gas distribution operations in nearby
Pennsylvania may provide some logistical and operational synergies,
and supportive ownership could enhance MGC's financial
flexibility.
Challenging Regulatory Environment: Fitch considers the regulatory
environment in West Virginia to be challenging. The WVPSC does not
currently allow revenue decoupling or weather normalization,
contributing to sometimes volatile cash flows and credit metrics.
MGC's 9.75% authorized ROE is in line with industry averages.
However, the WVPSC's use of a historical test year with typically
an average rate base valuation methodology in rate case decisions
causes significant regulatory lag and makes it difficult for the
company to earn its allowed ROE. Regulatory lag is partially
mitigated by the IREP cost-recovery rider, which provides
more-timely recovery of costs related to system expansion and pipe
replacement.
Small Scale of Operations: MGC's current ratings are also
restricted by the utility's small scale of operations. Over the
last three years, operating EBITDA and FFO have each averaged less
than $35 million per year, making MGC the smallest stand-alone
investor-owned utility rated by Fitch. Small changes in revenue or
expenses can have a material impact on financial metrics, causing
the utility to be more vulnerable to external shocks. Such changes
in revenue are not unlikely given the regulatory environment in
West Virginia, which does not allow revenue decoupling or weather
normalization.
2019 Rate Case Settlement: Fitch considers MGC's recent rate case
outcome to be relatively constructive. On Dec. 26, 2019, the WVPSC
adopted a rate settlement which allowed MGC to implement a $13.4
million natural gas distribution base rate increase, which was then
reduced by about $1.0 million of refunds related to the Tax Cut and
Jobs Act. The rate order also included a reduction to the IREP
cost-recovery rider of $5.2 million. The 9.75% ROE authorized by
the commission was in line with MGC's previous rate case. The new
rates took effect Jan. 1, 2020.
In this rate order, the WVPSC calculated rate base and depreciation
using the terminal value of plant assets in the test year, matching
the more constructive method used by the IREP rider. Previously,
the WVPSC calculated rate base and depreciation using a 13-month
average balance, which resulted in more regulatory lag. MGC filed
its rate case with the WVPSC on March 6, 2019 and requested a net
rate increase of approximately $13.1 million, consisting of a base
rate increase of $19.3 million and a reduction to the IREP
cost-recovery rider of $6.2 million.
Supportive, but Volatile, Credit Metrics: Fitch expects MGC's
financial profile to remain supportive of the ratings throughout
the forecast period. However, the company's small size, large
seasonal working capital needs, and exposure to the effects of
weather could result in significant swings in credit metrics, both
on a seasonal basis and year-to-year. In 2019, leverage was
significantly weaker due to an abnormally mild winter. Assuming a
return to normal weather, Fitch expects FFO leverage and total debt
with equity credit/operating EBITDA to average approximately 4.7x
and 4.8x, respectively, through 2023.
Elevated Capex: Fitch expects MGC's capex to remain elevated over
the next several years, driven largely by the replacement of aging
infrastructure and bare steel pipe. The IREP cost-recovery rider
helps to alleviate concerns related to the large capex plan.
ESG Considerations:
MGC has an Environmental, Social and Governance (ESG) Relevance
Score of '4' for Group Structure and Financial Transparency, as
private equity-backed entities typically have less structural and
financial disclosure transparency than publicly traded issuers.
This has a negative impact on the credit profile and is relevant to
the rating in conjunction with other factors. Upon close of the
acquisition, Fitch would revise these ESG scores to '3'.
DERIVATION SUMMARY
MGC has a weaker business risk profile than the following peer
entities: The Berkshire Gas Company (BGC; A-/Stable), Connecticut
Natural Gas Corporation (CNG; A-/Stable) and The Southern
Connecticut Gas Company (SCG; A-/Stable). This is largely due to
West Virginia's challenging regulatory environment. BGC, CNG and
SCG operate in relatively balanced regulatory environments in
Massachusetts and Connecticut and benefit from full revenue
decoupling. MGC's ratings also have limited upside due to the
utility's private equity ownership, lack of weather normalization
or revenue decoupling, and greater leverage. Unlike MGC, which is a
stand-alone utility, BGC, CNG and SCG benefit from being owned by
AVANGRID, Inc. (BBB+/Stable), which is a large parent consisting of
eight regulated electric and natural gas distribution utilities.
MGC's credit metrics are weaker than its peers and are expected to
remain elevated throughout the forecast period as it executes its
capex program. Fitch expects MGC's FFO leverage and total debt with
equity credit/operating EBITDA to average approximately 4.7x and
4.8x, respectively, through 2023, considerably higher than peers
BGC, CNG and SCG.
KEY ASSUMPTIONS
Fitch's key assumptions within its rating case for the issuer
include:
-- Rate cases filed in 2021 and 2023, with incremental rates
going into effect on Jan. 1, 2022 and Jan. 1, 2024;
-- Capex between $53 million and $59 million over the forecast
years 2020 through 2023;
-- Equity infusion of $15 million in 2023 to help fund capex and
maintain MGCs regulated capital structure; and
-- Additional long-term debt of $40 million in 2021;
-- Normal weather.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Completion of the acquisition by UGI;
-- A material improvement in the regulatory environment that
results in more constructive rate design, including a
reduction in regulatory lag and implementation of revenue
decoupling or weather normalization, which would reduce
volatility of financial metrics;
-- FFO leverage expected to remain below 5.0x on a sustained
basis.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A termination of the pending acquisition;
-- FFO leverage expected to exceed 6.0x on a sustained basis.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Fitch considers MGC's liquidity to be adequate,
primarily supported by a $100 million unsecured committed RCF which
expires Nov. 26, 2024. The RCF includes an accordion feature that
could expand the size to $200 million to account for the
possibility of unusually high natural gas prices and sales volumes
that could occur during an abnormally cold winter heating season.
Fitch expects the RCF to provide sufficient liquidity to support
working capital needs and expects the company to extend the
facility prior to maturity or enter into another facility with
substantially similar terms. MGC had $32.5 million of borrowings
outstanding under the RCF as of Sept. 30, 2020, leaving $67.5
million of availability.
The seasonal nature of MGC's natural gas distribution business
leads to larger sales volumes during the winter months, often
requiring the company to temporarily finance rising natural gas
inventories and customer receivables with short-term borrowings
under its revolving credit facility (RCF). Short-term borrowings
typically peak in late December and are paid down by the end of the
first quarter.
The credit facility includes financial covenants requiring MGC to
maintain a minimum EBITDA interest coverage ratio of 2.0x and a
maximum debt-to-capitalization ratio of 65%. Long-term debt
maturities are manageable. MGC does not have any long-term debt
maturing until Dec. 20, 2027, when $40 million of 4.2% senior
unsecured bonds comes due.
ESG Considerations
MGC has an Environmental, Social and Governance (ESG) Relevance
Score of '4' for Group Structure and Financial Transparency, as
private equity-backed entities typically have less structural and
financial disclosure transparency than publicly traded issuers.
This has a negative impact on the credit profile and is relevant to
the rating in conjunction with other factors. Upon close of the
acquisition, Fitch would revise these ESG scores to '3'.
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.
NEWELL MOWING: Seeks to Hire Berken Cloyes as Bankruptcy Counsel
----------------------------------------------------------------
The Newell Mowing, Co. seeks approval from the U.S. Bankruptcy
Court for the District of Colorado to hire Berken Cloyes, P.C. as
its legal counsel.
The firm will provide services in connection with the Debtor's
Chapter 11 case, which include:
(a) analyzing the Debtor's financial situation;
(b) advising the Debtor of its powers and duties;
(c) preparing legal documents;
(d) representing the Debtor at the meeting of creditors and in
contested matters and adversary proceedings arising from or related
to the case; and
(e) other necessary legal services.
Berken Cloyes will be paid at these hourly rates:
Stephen E. Berken $350
Sean Cloyes $350
Joshua B. Sheade $300
Associate Attorney $200
Paralegals $125
The Debtor tendered the sum of $15,000 to Berken Cloyes for
pre-banruptcy services and costs incurred.
Acoridng to a court filing, Berken Cloyes is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code,
Berken Cloyes can be reached at:
Joshua B. Sheade, Esq.
1159 Delaware Street
Denver, CO 80202
Tel: (303) 623-4357
Fax: (720) 554-7853
Email: joshua@berkencloyes.com
About Newell Mowing
The Newell Mowing Co. filed for Chapter 11 bankruptcy protection
(Bankr. D. Colo. Case No. 20-17988) on Dec. 16, 2020. At the time
of the filing, the Debtor had estimated assets of between $100,001
and $500,000 and liabilities of between $500,001 and $1 million.
Berken Cloyes, P.C. is the Debtor s legal counsel.
NICE SERVICES: Payouts to Secured Claims Amended; Plan Confirmed
----------------------------------------------------------------
Judge Michael G. Williamson has entered an order approving the
Disclosure Statement and confirming the Plan of Reorganization of
Nice Services, Inc.
The entry of the plan confirmation order contemplates the
amendments to the following Classes:
* Class 3 consists of the Secured Claim of Caterpillar Financial
Services Corporation. The amount owed under Contract 791061 will be
amortized over 12 months at six percent interest per annum from the
petition date. The first payment shall be made by March 16, 2020.
The Debtor will pay to this Creditor equal monthly payments so that
payment is received by the 16th of each month until the total
allowed secured claim is paid in full. There is no prepayment
penalty. There is a 10-day grace period for each payment.
* Class 4 consists of the Secured Claim of John Deere Financial.
The secured amount shall be amortized over 48 months at 6 percent
interest per annum from the Petition Date. Equal monthly payments
of $1,580 will be made beginning with the payment due by March 16,
2020 and continuing so that payment is received by the 16th of each
month until the total allowed secured claim is paid in full.
* Class 5 consists of the Secured Claim of John Deere Financial.
The secured amount in this Class will be amortized over 48 months
at 6 percent interest per annum from the petition date. Equal
monthly payments of $823.78 will be made beginning with the payment
due by March 16, 2020 and continuing so that payment is received by
the 16th of each month until the total allowed secured claim is
paid in full.
* Class 6 consists of the Secured Claim of John Deere Financial.
The Debtor scheduled this claim for Deere in the amount of $28,533
secured by a Crawler Dozer 450 LGP in error, as Deere does not hold
any such claim. Class 6 which addresses this claim is deleted from
the Plan.
* Class 12 consists of the Secured Claim of Webster Capital
Finance, Inc. The secured amount allowed shall be amortized over 36
months at 6.0 percent interest per annum. The Debtor will pay to
this creditor equal monthly payments of $2,047 until the total
allowed secured claim is paid in full. The payments shall commence
30 days from the entry of the confirmation Order with a 10-day
grace period for each payment. This Creditor shall retain its lien
until paid in full and Debtor shall, on a periodic basis, provide
proof of insurance.
* Class 11 consists of the Secured Claim of Volvo Financial
Services, a Division of VFS US, LLC. The Secured Claim will be
amortized over 48 months at 6 percent interest per annum to be paid
in full by Nov. 30, 2023. The Debtor shall pay to this creditor
equal monthly payments of $5,318 until the total allowed Secured
Claim is paid in full as set forth in the Stipulation Regarding
Plan Treatment of Volvo Financial Services, a Division of VFS US
LLC (DE 92-1) (the "Stipulation"). The terms of the Stipulation,
which were approved by the Bankruptcy Court, will govern the
treatment of Class 11 and the Stipulation. Volvo Financial waives
its entitlement to payment in full of its administrative claim upon
confirmation in light of the incorporation of the Stipulation's
terms into this Confirmation Order.
* Class 12 consists of the Secured Claim of Webster Capital
Finance, Inc. The secured amount allowed will be amortized over 36
months at 6.0 percent interest per annum. The Debtor will pay to
this creditor equal monthly payments of $2,047 until the total
allowed secured claim is paid in full. The payments will commence
30 days from the entry of the confirmation Order with a 10-day
grace period for each payment. This Creditor will retain its lien
until paid in full and Debtor shall, on a periodic basis, provide
proof of insurance.
A paragraph in the Plan Confirmation Order provides, "Repayment of
Class 15 & 16 Claimants. Eventually the Debtor will propose an
Amended Order Confirming the Plan of Reorganization with
spreadsheet attached as Exhibit "A" and incorporated therein by
reference to represent the Debtors' payments to the Classes 15 and
16 claimants. These payments will become final and binding 30 days
after the filing of the Certificate of Substantial Consummation by
the Debtor."
Class 15 pertains to all unsecured claims of New York Lenders and
Class 16 comprises all general unsecured claims allowed under Sec.
502 of the Bankruptcy Code. The Plan provides that the Debtor will
fund $480,000 to a plan pool for unsecured creditors, to be paid in
20 equal distributions.
A status conference will be held in, Courtroom 8A, Sam M. Gibbons
United States Courthouse, 801 N. Florida Ave., Tampa, FL 33602 on
Jan. 27, at 9:30 a.m., before the Honorable Michael G. Williamson,
United States Bankruptcy Judge
A full-text copy of the Plan Confirmation order dated Jan. 7, 2021,
is available at https://bit.ly/3nv66HA
A copy of the Disclosure Statement dated Dec. 27, 2019, is
available at https://bit.ly/39nKec9
A copy of the Plan dated Dec. 27, 2019, is available at
https://bit.ly/2Xvi5Kq
Attorney for the Debtor:
Thomas C. Little
THOMAS C. LITTLE, P.A.
2123 N.E. Coachman Road, Suite A
Clearwater, Florida 33765
Telephone (727) 443-5773
Email: janet@thomasclittle.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.
NINEPOINT MEDICAL: Tall Marmot-Backed Plan Confirmed by Judge
-------------------------------------------------------------
Judge Karen B. Owens has entered findings of fact, conclusions of
law and an order approving the Disclosure Statement and confirming
the Second Amended Chapter 11 Plan of Reorganization of NinePoint
Medical, Inc.
The Plan proposed by the Debtor contemplates that the Debtor will
be reorganized and all of the Reorganized Debtor's equity interests
will be owned by Tall Marmot. The Distribution Trust is required
to make all payments under the Plan pursuant to the Distribution
Trust Agreement and, upon the Effective Date, the Plan Sponsor will
pay the Consideration to the Distribution Trust or the Debtor, and
such amounts (together with the Remaining Cash) will be distributed
in accordance with the Plan.
The Distribution Trust Agreement, substantially in the form filed
in the Notice of Filing of Revised NinePoint Medical Distribution
Trust Agreement, is approved and the Debtor is authorized to
execute and to take any action necessary or appropriate to
implement, effectuate, or consummate the Distribution Trust
Agreement. The appointment of RCNPM, LLC as Distribution Trustee
is approved.
Tall Marmot is the Plan Sponsor and the DIP Lender.
According to the Disclosure Statement, the Plan provides that:
* To the extent the DIP Lender exercises the subscription
option, the DIP Lender will receive New Equity of the Reorganized
Debtor.
* In exchange for payment of the Consideration of $1,325,000 in
cash on the Effective Date, plus (ii) all remaining cash (if any),
the Plan Sponsor, will receive the remainder of the New Equity of
the Reorganized Debtor.
* On or about the Effective Date (x) if and only if holders of
General Unsecured Claims vote in sufficient number and amount such
that Class 4 accepts the Plan, then each holder of an Allowed
General Unsecured Claim will receive its pro rata share of the GUC
Recovery; and (y) if holders of General Unsecured Claims do not
vote in sufficient number and amount such that Class 4 accepts the
Plan, then there will be no GUC Recovery. "GUC Recovery" means
$100,000.
* All existing equity interests will be deemed automatically
cancelled, released, and extinguished without further action by the
Debtor or the Reorganized Debtor.
A full-text copy of the Plan Confirmation order entered Jan. 7,
2021, is available at https://bit.ly/38vnOGp
A copy of the Plan is available at https://bit.ly/3q4TjNC
A copy of the Disclosure Statement is available at
https://bit.ly/38whcaT
About Ninepoint Medical
NinePoint Medical, Inc., is a privately held medical device company
that designs, manufactures and sells an Optical Coherence
Tomography (OCT) imaging platform for the evaluation of human
tissue microstructure.
NinePoint Medical sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 20-12618) on Oct. 16,
2020. In the petition signed by CRO Brian Ayers, the Debtor was
estimated to have $1 million to $10 million in assets and $10
million to $50 million in liabilities.
The Hon. Karen B. Owens oversees the case.
The Debtor tapped McDermott Will & Emergy LLP as its bankruptcy
counsel, Rock Creek Advisors LLC as restructuring advisor, and
Stretto as claims and noticing agent.
NORTH TAMPA: Unsecureds Will Receive 1% of Their Claims
-------------------------------------------------------
The hearing regarding confirmation of Joint Amended Chapter 11 Plan
of Reorganization filed by debtors HLPG Newaco, LLC, and North
Tampa Anesthesia Consultants, PA, held on Dec. 17, 2020, has been
rescheduled to Jan. 19, 2021 at 02:30 p.m. in Courtroom 8B, Sam M.
Gibbons United States Courthouse, 801 N. Florida Avenue, Tampa, FL
33602.
North Tampa Anesthesia Consultants, P.A., and affiliate HLPG
NEWACO, LLC, submitted on Dec. 14, 2020 an Amended Joint Chapter
11, Subchapter V Plan of Reorganization.
The Plan proposes to pay the Debtors' creditors from cash flow from
operations, contributions from the Principals, future income, and
the sale of HLPG's aircraft. The Principals have also already
reduced their salaries during the pendency of these cases, and they
commit to making the Plan payments.
In addition, Fifth Third and the Principals have agreed in
principle to a deal wherein the Principals, through the Debtors,
pay to Fifth Third $43,000 ("Forbearance Payment") on the Effective
Date and provide Fifth Third with a stipulated judgment from the
Principals in the State Court Suit ("Fifth Third Judgment") in the
full amount of the indebtedness owed, to be held in escrow, in
exchange for Fifth Third forbearing from exercising rights and
remedies against the Principals under the Fifth Third Judgment
under certain conditions. Fifth Third and the Principals are
finalizing the details of this arrangement in a separate agreement
to be approved by the Principals, the Debtors, Fifth Third, and the
State Court ("State Court Settlement Agreement").
The Principals, through the Debtors, have also agreed to make
certain additional payments towards Fifth Third's loan balance if
the Aircraft is not sold within two years from the anniversary of
the Effective Date.
The Plan calls for substantive consolidation for both Debtors and
no creditors will be prejudiced.
Non-priority general unsecured creditors holding allowed claims
will receive distributions, which the proponents of the Plan have
valued at approximately one cent on the dollar.
Class 3 consists of the claims of the Allowed general unsecured
creditors in the estimated amount of approximately $6,201,693.
However, the Debtor filed an objection to Claim No. 6. The Debtor
will pay 1 percent of the allowed claims of the Class 5 claimants
by making equal monthly payments of $1,034 per month beginning upon
the Effective Date of the Plan and continuing each month thereafter
for a total of 60 months, in full satisfaction of any and all
liabilities of the Debtor and its current and former Principals
arising out of the Class 3 claims, except for Claim No. 6.
A full-text copy of the Amended Joint Chapter 11, Subchapter V Plan
of Reorganization dated Dec. 14, 2020, is available at
https://bit.ly/3awICia from PacerMonitor.com at no charge.
Attorneys for the Debtor:
Angelina E. Lim
JOHNSON, POPE, BOKOR, RUPPEL & BURNS, LLP
401 E. Jackson Street, Ste. 3100
Tampa, FL 33602
Telephone: 813-225-2500
Facsimile: 813-223-7118
E-mail: Angelinal@jpfirm.com
About NTAC and HLPG
North Tampa Anesthesia Consultants, P.A. ("NTAC"), a Florida
professional association, is a medical practice that provides
anesthesia services to various hospitals around the area. It has
been in operations for over 20 years. NTAC has its offices at 1402
W. Fletcher Avenue, Tampa, FL 33612.
NTAC's doctors have historically used helicopters for
transportation purposes. For many years, NTAC's affiliate, HLPG
NEWACO, LLC, owned a helicopter that was used by NTAC's doctors to
quickly and conveniently fly from one location to another to
fulfill NTAC's contractual obligations to provide anesthesia
services. HLPG's most recent helicopter is an Italian make
helicopter-1990 Agusta A109C, U.S. helicopter, U.S. Reg. No.
N109GL, S/N 7623; Rolls Royce 250-C20R/1 Engines, S/N 295559 and
295560; Main Rotor Blades EM0264, EM0301, EM0628, and EM0626
("Aircraft)".
NTAC and HLPG sought Chapter 11 protection (Bankr. M.D. Fla. Case
No. 20-02101 and 20-02102) on March 10, 2020. In the petition
signed by Gabriel Perez, director/practice administrator, NTAC was
estimated to have $1 million to $10 million in both assets and
liabilities. Angelina E. Lim, Esq., at Johnson Pope Bokor Ruppel &
Burns, LLP, serves as bankruptcy counsel to the Debtors. Jennis
Law Firm, is special counsel.
NPC INTERNATIONAL: Reaches Deals With Flynn, Wendy's on $800M Sale
------------------------------------------------------------------
NPC International, Inc., announced on Jan. 7, 2021 that, following
a successful mediation process, the Company has reached separate
asset purchase agreements with Flynn Restaurant Group and Wendy's
International LLC which would result in the sale of substantially
all of NPC's assets and pave the way for NPC to complete its
chapter 11 restructuring.
A hearing before the United States Bankruptcy Court for the
Southern District of Texas to consider the approval of the sale
transactions is currently scheduled for January 15, 2021.
The combined purchase price of the two sale transactions is
approximately $801 million. The asset purchase agreements filed
with the Court provide for the following:
* Flynn will acquire over 925 of NPC's Pizza Hut restaurants;
about half of NPC's Wendy's restaurants; and substantially all of
NPC's shared service assets.
* Wendy's will acquire NPC's remaining Wendy's restaurants and
assign the right to acquire restaurants to five current Wendy's
franchisees (the "Wendy's Purchasers," and together with Flynn, the
"Purchasers").
* The Purchasers have agreed to offer positions of employment
to all of NPC’s restaurant field operations employees and
substantially all other non-field NPC employees.
"This is an excellent outcome for NPC's Wendy's restaurants and our
team," said Carl Hauch, CEO & President of NPC's Wendy's division.
"We are very pleased that our restaurants will be joining the ranks
of established, high performing restaurant franchise groups. We
are grateful to Judge Isgur for his guidance during the mediation
process and to Wendy's, Flynn, the Wendy's franchisee acquirers and
our lenders for working diligently to allow for this result."
"We are confident that NPC's Pizza Hut restaurants will be in very
good hands as part of Flynn Restaurant Group," said Jon Weber, CEO
& President of NPC's Pizza Hut division. "We have developed
excellent teams at our Pizza Hut restaurants around the country,
and I'm extremely proud of the way our organization rallied
together in 2020 and maintained our commitment to delivering
excellent quality and service."
"Flynn Restaurant Group has built our business over the last twenty
plus years by focusing on managing superior operations with great
teams of people at premier restaurant concepts," said Greg Flynn,
Founder, Chairman and Chief Executive Officer of Flynn Restaurant
Group. "The Pizza Hut and Wendy's restaurants we have agreed to
acquire from NPC align perfectly with this strategy, and we're
confident that our new team members will fit right in at Flynn
Restaurant Group."
Subject to Court approval, the execution of definitive
documentation, and the approval of certain matters subject to
Wendy's and Pizza Hut's consent of Flynn Restaurant Group as a new
franchisee, the sale transactions are expected to close by the end
of the second quarter of 2021.
About NPC International
NPC International, Inc. -- https://www.npcinternational.com/ -- is
a franchisee company with over 1,600 franchised restaurants across
two iconic brands -- Wendy's and Pizza Hut -- spanning 30 states
and the District of Columbia. NPC is the largest Wendy's and Pizza
Hut franchisee, operating nearly 400 restaurants of the burger
chain to go along with 900 units of the pizza concept. It is also
the second largest franchisee in the U.S. -- one spot behind FRG,
which operates Arby's, Applebee's, Panera Bread and Taco Bell.
NPC International and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No.
20-33353) on July 1, 2020. At the time of the filing, the Debtors
estimated assets of between $1 billion and $10 billion and
liabilities of the same range.
Judge David R. Jones oversees the cases.
Weil, Gotshal & Manges LLP is acting as NPC's legal counsel,
Greenhill & Co., LLC is acting as financial advisor, AlixPartners
LLP is serving as restructuring advisor, A&G Realty is acting as
real estate advisor to the Company, and The Cypress Group is acting
as quick-service restaurant M&A advisor in connection with the
transaction. Epiq Corporate Restructuring, LLC, is the claims,
noticing and solicitation agent and administrative advisor.
Davis Wright Tremaine LLP and Kirkland & Ellis LLP are serving as
legal counsel to Flynn Restaurant Group LP.
Cleary, Gottlieb, Steen & Hamilton LLP is acting as legal counsel,
and Jefferies LLC is acting as financial advisor to Wendy's.
McDermott, Will & Emery LLP is acting as legal counsel, and FTI is
acting as financial advisor to Pizza Hut, LLC.
OAKSHIRE MUSHROOM: Has Deal on Avondale Sale, Unsecureds Get $87K
-----------------------------------------------------------------
Oakshire Mushroom Farms, Inc. ("OMF") and Oakshire Mushroom Sales,
LLC ("OMS") submitted an Amended Joint Chapter 11 Plan and
corresponding Disclosure Statement on Jan. 6, 2021.
The Debtors filed the Amended Plan seeking to provide a basis for
resolving outstanding claims against them through four general
mechanisms:
(1) subject to Shore United Bank's ("SUB") approval, the
Debtors intend to market and sell the Avondale Property to generate
requisite funds to implement this Plan;
(2) pending the sale of the Avondale Property and, at the
closing on the such sale, the funds necessary for the
implementation of the Plan will be utilized from
(a) sale proceeds of the Debtors' commercial trucks, the
proceeds of which will first be used to fund PACA Creditors'
Claims,
(b) 25 percent of rent or lease proceeds from the Avondale
Property until the closing on a sale
(c) monthly contributions from Gary Schroeder, the
Debtors' principal and
(d) the recoveries, if any, from Preference Actions;
(3) an Unsecured Creditor Carve Out from the proceeds of the
sale of the Avondale Property and
(4) the Schroeder New Value Contribution.
In March 2020, when restaurants were forced to close dining rooms
due to COVID-19, restaurants effectively stopped buying fresh
foods, including mushrooms. As a result, the Debtors' sales
plummeted. Since that time, SUB and the Debtors have worked
together to address the disposition of OMF's remaining assets,
namely the Avondale Property. The Plan filed on Jan. 5, 2021,
reflects the agreement between SUB and the Debtors and provides the
foundation for a distribution to subordinate creditors, including,
but not limited to, unsecured creditors, who would otherwise not
participate in a distribution due to SUB's undersecured claim
status.
Total allowed claim amounts have been dramatically decreased during
the Chapter 11 cases as a result of (i) Bankruptcy Court Orders
authorizing periodic payments to PACA creditors and to SUB, (ii)
Bankruptcy Court Orders approving settlement and payment of claims
to the largest PACA creditors, and (iii) the reduction of SUB's
claims from the sale of non-Debtor property. Debtors' counsel has
begun the Claims review process and shall begin objecting to
Disputed Claims, including the very large and Disputed Claims filed
after the Bar Date. After the necessary adjustments are made for
the Court authorized payments on account of Allowed Claims, the
principal/interest reduction of SUB's indebtedness following the
liquidation of non-Debtor Assets (including a scheduled sale of
additional non-Debtor real property for April 2021), the Disputed
Claims and the Barred Claims, the Debtors believe that total
reduced Secured Claims will be $2,699,000 and total reduced
Unsecured Claims are no greater than $4,400,000.
Class 1 consists of the Secured Claims of SUB by virtue of its
UCC-1 liens on all assets of the Debtors, together with its first
priority mortgage in the Avondale Property securing the Debtors'
obligations to SUB under the SUB Loan Documents, as well as SUB's
adequate protection claims and superpriority claims granted to SUB
by orders of the Bankruptcy Court in the Case. SUB's Secured Claim
is Impaired and SUB is entitled to vote to accept or reject the
Plan on account of its Class 1 Secured Claim. From and after the
Effective Date, SUB will receive 75 percent of rent or lease
proceeds from the Avondale Property, if any, and payment of the
proceeds of sale of the Avondale Property at closing, less
reasonable closing costs and less the Unsecured Creditor Carve Out.
Any remaining sums due on account of SUB's Allowed Secured Claim
shall be paid in full on or before December 31, 2021.
Class 5 Unsecured Creditors will receive a pro rata share of (I)
the Unsecured Creditor Carve Out totaling $87,000 if (a) the
Avondale Property is sold on or before the earlier of (i) a default
on the Plan and (ii) Dec. 31, 2021 (or any subsequent date for a
sale of the Avondale Property under the Plan as agreed to by SUB)
and (b) the sale is subject to the Transfer Tax Exemption and (II)
the Schroeder New Value Contribution in favor of Allowed Class 5
Unsecured Creditors totaling $35,000 funded on or before Dec. 31,
2021 by Mr. Schroeder. Based upon the General Unsecured Claims
scheduled by the Debtors, the Unsecured Claims timely filed by
Class 5 Creditors and the anticipated deficiency claims, including
the MCA Companies, the Debtor estimates the percentage distribution
to Class 5 Allowed Claims of approximately 2.8% to 3.0%.
Subject to SUB's approval of an acceptable marketing plan for the
sale of the Avondale Property that provides for the payment of all
Avondale Property real estate taxes, insurance and carry costs to
be funded until the earlier of the closing on such sale or December
31, 2021 (unless such date is extended by SUB), Debtors intend to
market and sell the Avondale Property to generate requisite funds
to implement this Plan. The Avondale Property is being marketed
for sale at $1,900,000. Pending such sale and, thereafter, at the
closing on the such sale, the funds necessary for the
implementation of the Plan shall be utilized from (1) sale proceeds
of the Debtors' three commercial trucks, the proceeds of which will
first be used to fund PACA Creditor Claims and any remainder to
fund other costs arising under the Plan, (2) 25 percent of rent or
lease proceeds from the Avondale Property, if any, until the
closing on a sale, (3) monthly contributions from Mr. Schroeder,
which contributions shall be deposited in OMF's existing BB&T DIP
escrow account in advance of the projected monthly expenses (per
the SUB approved budget) on or before the last business day of the
preceding month to fund all Avondale Property carrying costs until
the closing, and (4) the recoveries, if any, from the Preference
Actions, (5) the proceeds from the sale of the Avondale Property
allocated to the Reorganized Debtors under the Plan, (6) the
Unsecured Creditor Carve Out and (7) the Schroeder New Value
Contribution.
A full-text copy of the Amended Joint Plan and Disclosure Statement
dated Jan. 5, 2021, is available at https://bit.ly/3nkKq0A from
PacerMonitor.com at no charge.
The Debtors are represented by:
SMITH KANE HOLMAN, LLC
Robert M. Greenbaum, Esquire
112 Moores Road, Suite 300
Malvern, PA 19355
Tel: (610) 407-7216
Fax: (610) 407-7218
E-mail: rgreenbaum@skhlaw.com
About Oakshire Mushroom Farm
Oakshire -- http://www.oakshire.com/-- has been a grower of
specialty mushrooms since 1985. Its offices are located in Kennett
Square, Pa.
Oakshire Mushroom Farm, Inc., and its affiliate Oakshire Mushroom
Sales, LLC, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Pa. Lead Case No. 18-18446) on Dec. 28, 2018. At
the time of the filing, each Debtor estimated assets of less than
$1 million and liabilities of $1 million to $10 million. Judge
Jean K. FitzSimon oversees the cases. The Debtors tapped Smith
Kane Holman, LLC, as legal counsel.
ORTHO-CLINICAL DIAGNOSTICS: S&P Places 'B-' ICR on Watch Positive
-----------------------------------------------------------------
S&P Global Ratings placed all its ratings on In vitro diagnostics
provider Ortho-Clinical Diagnostics Bermuda Co. Ltd., including the
'B-' issuer credit rating, on CreditWatch with positive
implications.
S&P expects to resolve its CreditWatch when the IPO closes and
Ortho-Clinical repays the debt as intended. Based on the proposed
use of proceeds, the rating agency expects to raise the issuer
credit rating to 'B' from 'B-'.
Ortho-Clinical has filed a public form S-1, indicating the expected
use of proceeds from its upcoming IPO. Ortho-Clinical intends to
redeem $160 million of its 7.375% senior notes due in 2025, $270
million of its 7.25% senior notes due in 2028, and the remainder
for general corporate purposes, including to repay borrowings under
the senior secured term loan facility.
S&P said, "We are placing the ratings on Ortho-Clinical on
CreditWatch based on our expectation for material debt reduction
and improved cash generation following the close of its IPO this
quarter. Based on the intended senior notes repayment of $430
million, we expect 2021 adjusted leverage to decline to the mid-6x
area, down about one turn from our previous expectation of 7.6x. We
also expect free cash flow to improve substantially, driven by at
least $30 million in reduced interest burden."
"We now expect free operating cash flow (FOCF) generation in excess
of $60 million and FOCF to debt greater than 3%. These credit
measures would be even further improved if Ortho-Clinical elects to
use excess proceeds to repay a portion of the senior security term
loan facility."
"We expect to resolve the CreditWatch on Ortho-Clinical when the
IPO closes in the first quarter and the debt is repaid as intended.
Based on the proposed use of proceeds (a reduction of $430 million
of senior notes), which would reduce leverage and improve cash flow
due to a lower interest burden, we expect to raise the issuer
credit rating to 'B' from 'B-'."
"If Ortho-Clinical elects to also substantially repay borrowings
under the senior secured term loan facility, leading us to believe
it would maintain adjusted leverage comfortably below 5x, we could
consider taking further positive action."
PBS BRAND: U.S. Trustee Appoints Creditors' Committee
-----------------------------------------------------
The U.S. Trustee for Region 3 on Jan. 6, 2021, appointed an
official committee to represent unsecured creditors in the Chapter
11 cases of PBS Brand Co., LLC and its affiliates.
The committee members are:
1. ARC WEMPSMN001, LLC
Attn: Michael Anderson
c/o John Elrod, Esq.
Terminus 200, 3333 Piedmont Rd NE, Suite 2500
Atlanta, GA 30305
Phone: 678-553-2259
E-mail: ElrodJ@gtlaw.com
2. Scout Media Design dba Conveyor
Attn: Andee Conner Foutch
P.O. Box 6479
Denver, CO 80206
Phone: 720-220-1190
E-mail: andee@conveyormedia.com
3. Wynwood DS, LLC
Attn: Scott Srebnick, Esq.
22124 N.W. 1st Place, 2nd Floor
Miami, FL 33127
Phone: 305-285-9019
E-mail: Scott@srebnicklaw.com
4. Brookfield Properties Retail, Inc.
Attn: Julie Minnick Bowden
350 N Orleans Street, Suite 300
Chicago, IL 60654
Phone: 312-960-2707
E-mail: julie.bowden@brookfieldpropertiesretail.com
5. Simon Property Group
Attn: Ronald M. Tucker
225 West Washington Street
Indianapolis, IN 46204
Phone: 317-263-2346
E-mail: rtucker@simon.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 PBS Brand Co. LLC
PBS Brand Co. LLC and its affiliates are a chain of "eatertainment"
venues that blends best in category scratch-kitchen culinary
specialties, and craft cocktail and craft non-alcoholic programs.
Each of the Punch Bowl locations is a design-forward environment
that provides its patrons with a different and diverse selection of
games including, among other things, bowling, scrabble,
shuffleboard, virtual reality, billiards, karaoke, vintage arcade
games, ping-pong, darts, and skee-ball, and in one location, a
nine-hole miniature golf course, that create a setting conducive to
large corporate gatherings as well as a la carte sales.
PBS Brand Co. and its affiliates concurrently filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Case No. 20-13157) on Dec. 21, 2020. Stacy Johnson
Galligan, authorized representative, signed the petitions. At the
time of the filing, PBS Brand was estimated to have $10 million to
$50 million in both assets and liabilities.
Judge John T. Dorsey oversees the cases.
The Debtors tapped Morris James LLP as counsel, Gavin/Solmonese as
restructuring advisor, and Omni Agent Solutions as claims,
noticing, and balloting agent.
PEAK SERUM: Trustee Taps Sender & Smiley, Cohen as Legal Counsel
----------------------------------------------------------------
Jay Roderick, the Chapter 11 trustee for Peak Serum, Inc., received
approval from the U.S. Bankruptcy Court for the District of
Colorado to hire Sender & Smiley, LLC and Cohen & Cohen, P.C. as
his legal counsel.
The law firms will handle general representation of the trustee and
litigation matters arising in the Chapter 11 case of the Debtor.
The law firms will be paid at these hourly rates:
John C. Smiley $550
Harvey Sender $550
Robertson B. Cohen $400
Katharine S. Sender $295
Paralegals $115
Katharine Sender, Esq., at Cohen & Cohen, and John Smiley, Esq., at
Sender & Smiley, disclosed in court filings that their firms are
"disinterested persons" as the term is defined in Section 101(14)
of the Bankruptcy Code.
The law firms can be reached at:
John C. Smiley, Esq.
Sender & Smiley, LLC
600 17th Street, Suite 2800 South
Denver, CO 80202
Tel: (303) 454-0540
Fax: (303) 568-0102
Email: jsmiley@sendersmiley.com
-- and --
Katharine S. Sender, Esq.
Cohen & Cohen, P.C.
1720 S Bellaire St, Suite 205
Denver, CO 80222
Tel: (303) 933-4529
Email: ksender@cohenlawyers.com
About Peak Serum
Headquartered in Wellington, Colo., Peak Serum is a privately owned
and independent supplier of life science laboratory products. Its
core focus is Fetal Bovine Serum (FBS) for cGMP/clinical trial
research and diagnostics applications. It offers a wide range of
100% US Origin and USDA-Approved FBS products for all levels of
research compliance.
Peak Serum sought Chapter 11 protection (Bankr. D. Colo. Case No.
19-19802) on Nov. 13, 2019. At the time of the filing, Debtor
disclosed total assets of $956,300 and total liabilities of
$3,580,644. Thomas Kutrubes, president and chief executive
officer, signed the petition.
Judge Joseph G. Rosania Jr. oversees the case.
Debtor tapped Wadsworth Garber Warner Conrardy, P.C. as its legal
counsel and Dennis & Company as its accountant.
PETERSEN-DEAN INC: SPI's SolarJuice Acquires Consumer Contracts
---------------------------------------------------------------
SPI Energy Co., Ltd., (NASDAQ:SPI), a global renewable energy
company and provider of photovoltaic (PV) and electric vehicle (EV)
solutions for business, residential, government, logistics and
utility customers and investors, announced Jan. 6, 2021, that its
wholly owned subsidiary, SolarJuice American, Inc., acquired the
consumer contracts of Petersen-Dean, Inc., one of the largest
full-service, privately-held roofing and solar companies in the
US.
Petersen-Dean was generating $300 million to $400 million in sales
annually with favorable profit margins prior to COVID-19. "Our
acquisition of these consumer contracts could save thousands of US
jobs that were in jeopardy following Petersen-Dean's Chapter 11
filing in June 2020. This is also a major win for us as we work to
accelerate our penetration in the vast US markets and create better
renewable products and services for American residential
customers," stated Xiaofeng Peng, Chairman and CEO of SPI Energy.
The U.S. installed 3.8 gigawatts (GW) of solar PV capacity in Q3
2020 to reach 88.9 GW of total installed capacity, enough to power
16.4 million American homes. Wood Mackenzie forecasts 43% annual
growth in 2020, with more than 19 GW of installations expected. In
total, the U.S. solar market will install more than 107 GW of solar
over the next five years.
About SPI Energy
SPI Energy Co., Ltd. (SPI) -- http://www.SPIgroups.com/-- is a
global renewable energy company and provider of photovoltaic (PV)
and electric vehicle (EV) solutions for business, residential,
government, logistics and utility customers and investors. The
Company provides a full spectrum of EPC services to third party
project developers, as well as develops, owns and operates solar
projects that sell electricity to the grid in multiple countries,
including the U.S., the U.K., Greece, Japan and Italy. The Company
has its US headquarters in Santa Clara, California and maintains
global operations in Asia, Europe, North America and Australia.
SPI is also targeting strategic investment opportunities in green
industries such as battery storage and charging stations,
leveraging the Company's expertise and growing base of cash flow
from solar projects and funding development of projects in
agriculture and other markets with significant growth potential.
About Petersen Dean Inc.
Founded in 1984, Petersen-Dean was one of the nation's largest
independently owned solar and roofing companies that specialized in
new residential construction. At its peak, the company employed
nearly 3,000 solar and roofing employees in nine states: Arizona,
California, Colorado, Florida, Hawaii, Louisiana, Nevada, Oklahoma
and Texas. On the Web: http://www.petersendean.com/
Petersen-Dean, Inc., and 15 affiliates, including Red Rose, Inc.,
sought Chapter 11 protection on June 11, 2020. The lead case is In
re Red Rose, Inc. (Bankr. D. Nev. Case No. 20-12814).
Red Rose was estimated to have $10 million to $50 million in assets
and liabilities.
Judge Mike K. Nakagawa oversees the cases.
The Debtors are represented by Fox Rothschild, LLP.
PG&E CORP: Victims Trustee Urges Court to Toss Plan Appeal
----------------------------------------------------------
Law360 reports that the trustee for PG&E Corp.'s wildfire victims
urged a California federal judge Thursday, January 7, 2021, to toss
an appeal by Adventist Health, Comcast and others challenging the
utility's bankruptcy plan, arguing that they failed to preserve
their rights to challenge the plan and that finding otherwise would
have a "catastrophic" effect on 80,000 victims.
During a telephone hearing, Eric Goodman of Brown Rudnick LLP,
trustee to the wildfire victims, told U.S. District Judge Haywood
S. Gilliam Jr. that the organizations' appeal is moot because they
never sought a motion to stay the plan's confirmation before the
bankruptcy judge.
About PG&E Corp.
PG&E Corporation (NYSE: PCG) -- http://www.pgecorp.com/-- is a
Fortune 200 energy-based holding company, headquartered in San
Francisco. It is the parent company of Pacific Gas and Electric
Company, an energy company that serves 16 million Californians
across a 70,000-square-mile service area in Northern and Central
California.
PG&E Corp. and its regulated utility subsidiary, Pacific Gas and
Electric Company, said they are facing extraordinary challenges
relating to a series of catastrophic wildfires that occurred in
Northern California in 2017 and 2018. The utility said it faces an
estimated $30 billion in potential liability damages from
California's deadliest wildfires of 2017 and 2018.
On Jan. 29, 2019, PG&E Corp. and its primary operating subsidiary,
Pacific Gas and Electric Company, filed voluntary Chapter 11
petitions (Bankr. N.D. Cal. Lead Case No. 19-30088).
Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP served
as PG&E's legal counsel, Lazard was its investment banker and
AlixPartners, LLP, was the restructuring advisor to PG&E. PG&E
appointed James A. Mesterharm, a managing director at AlixPartners,
LLP, and an authorized representative of AP Services, LLC, to serve
as CRO. Morrison & Foerster LLP, was the special regulatory
counsel, and Munger Tolles & Olson LLP, was special counsel. Prime
Clerk LLC was the claims and noticing agent.
The Office of the U.S. Trustee formed an official committee of
creditors. The Committee retained Milbank LLP as counsel; FTI
Consulting, Inc., as financial advisor; Centerview Partners LLC as
investment banker; and Epiq Corporate Restructuring, LLC, as claims
and noticing agent.
The U.S. trustee appointed an official committee of tort claimants.
The tort claimants' committee was represented by Baker & Hostetler
LLP.
* * *
PG&E announced July 1, 2020, that it has emerged from Chapter 11
bankruptcy, successfully completing its restructuring process.
PG&E in June 2020 won bankruptcy court approval of a $58
billion-dollar reorganization plan that includes settlements
exceeding $25 billion to resolve claims by wildfire victims and
regulatory agencies. PG&E retired expensive, high-coupon debt and
replaced it with lower-cost debt, yielding annual savings of $250
million annually.
PINKLEY FARMS: $350K Sale of Springdale Property to Geels Approved
------------------------------------------------------------------
Judge Ben Barry of the U.S. Bankruptcy Court for the Western
District of Arkansas authorized Pinkley Farms, Inc.'s sale of the
real property located at 3194 Pinkley Road, in Springdale,
Arkansas, Assessor's Parcel Number 21-00167-565, to Steve Geels and
Linda Geels for $350,000.
The Real Estate is subject to a judgment lien and decree of
foreclosure of a consensual mortgage given by the Debtor to First
Security Bank, all addressed in Benton County, Arkansas Circuit
Court case 04CV-20-1608 with an approximate judgment amount of
$173,909. The Real Estate does not include any of the real
property subject to the decree of foreclosure referred to.
The sale is free and clear of all mortgages, liens, claims, and
interests of any kind.
The lien of First Security Bank will attach to the proceeds of the
sale to the extent of its claims on the date of closing, including
accrued interest, its costs, and attorney's fees, and such proceeds
will be paid to First Security Bank or its designee at closing by
the closing agent. Specifically, the sales proceeds will be used
to pay in full loan numbers ending in 0879 and 0287 due and owing
by the Debtor to First Security Bank, inclusive of principal,
interest and late fees, costs in connection with collection,
including attorneys' fees, owing on the loans as of the closing
date. The amount due and owing First Security Bank as of Jan. 4,
2021, is $188,962 with interest accruing at the rate of $84 per
day.
The Debtor, via its legal counsel, will provide to First Security
Bank at least seven days before the date first scheduled for
closing a closing statement for its approval. And First Security
Bank's legal counsel will provide the final sum due and owing to it
for insertion into the closing statement.
The closing agent will remit to the IOLTA trust account of the
legal counsel for the Debtor all remaining net sums pending further
orders of the Court.
The sale will close within 30 days of the date of entry of the
Order, and if not closed, the Order will become void without
prejudice to subsequent Motion to Sell filed by the Debtor or
provisions in a subsequently proposed chapter 11 plan.
About Pinkley Farms, Inc.
Pinkley Farms, Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Ark. Case No. 20-72281) on Nov. 5,
2020.
The petition was signed by Terry Pinkley, the company's president.
At the time of the filing, Debtor had estimated assets of less
than
$50,000 and liabilities of the same range.
Judge Ben T. Barry oversees the case. Bond Law Office is Debtor's
legal counsel.
PLAINS END: Fitch Affirms B+ Rating on Subordinated Secured Bonds
-----------------------------------------------------------------
Fitch Ratings has affirmed Plains End Financing LLC's senior
secured bonds at 'BB+' and the subordinated secured (junior) bonds
at 'B+'. The Rating Outlook for both the senior secured and
subordinate secured bonds is Stable.
RATING RATIONALE
Summary: The ratings reflect expectations of continued stable
operational and cost profiles. Plains End benefits from fixed-price
tolling-style power purchase agreements (PPAs) with an
investment-grade counterparty. However, the cash flow profile is
susceptible to fluctuations in project dispatch and operating
costs, resulting in an average rating case debt service coverage
ratio (DSCR) of 1.37x for the senior notes through the senior
debt's maturity in 2028. Additionally, the junior note's
three-notch rating difference reflects potential refinance risk,
structural subordination and a minimum consolidated rating case
coverage of 1.12x through the subordinated debt's maturity in
2023.
The outbreak of coronavirus and related government containment
measures worldwide create an uncertain global environment for the
oil and natural gas markets in the near term. While performance
data of Plains End through most recently available issuer data may
not have indicated impairment, material changes in revenue and cost
profile are occurring across the energy sector and will continue to
evolve as economic activity and government restrictions respond to
the ongoing situation. Fitch's ratings are forward-looking in
nature, and Fitch will monitor developments in the sector as a
result of the virus outbreak as it relates to severity and
duration, and incorporate revised base and rating case qualitative
and quantitative inputs based on expectations for future
performance and assessment of key risks.
KEY RATING DRIVERS
Operational Stability Mitigates Cost Increases - (Operation Risk:
Midrange)
The project, consisting of two peaking facilities (PEI and PEII),
was designed to provide backup generation for nearby wind projects
due to the intermittency of wind resources. Operating costs
fluctuate based on the level of dispatch and, in the past,
heightened dispatch substantially accelerated the timing of planned
major maintenance events. However, dispatch has decreased from the
2008 high and future operating risk is partially mitigated by
strong availability and a stabilized cost profile.
Low Supply Risk - (Supply Risk: Stronger)
The tolling-style PPAs are with Public Service Company of Colorado
(PSCo; A-/Stable). Under the contracts, all variable fuel expenses
are passed through to PSCo, subject to heat rate adjustments. The
contracts represent a stronger attribute that limits the fuel
supply risk to the project.
Stable Contracted Revenues - (Revenue Risk: Midrange)
The project benefits from stable and predictable revenues under two
20-year fixed price PPAs with a strong utility counterparty, PSCo.
Under the PPAs, PEI and PEII receive substantial capacity payments
that account for nearly 90% of consolidated revenues. However,
energy margins may not sufficiently fund accelerated overhaul
expenses resulting from increased dispatch.
Typical Structural Features- (Debt Structure (Senior): Midrange)
Plains End's senior debt has standard structural features,
including a forward- and backward-looking dividend lock-up at 1.20x
consolidated DSCR, a six-month debt service reserve and is both
fully amortizing and fixed rate.
Refinance Risk for Subordinated Debt- (Debt Structure
(Subordinate): Weaker)
While the senior debt benefits from a typical project finance
structure, the 'B+' rating on the subordinate notes reflects the
potential for refinance risk in 2023 if the project is unable to
meet target amortization amounts. Under the Fitch rating case,
which demonstrates the effect of reduced cash flow to the
subordinate tranche, sufficient cushion remains to repay the sub
notes by 2023. If the project only pays the minimum amortization
payments, there would be a balloon in 2023 for the outstanding
amount. Plains End management team has confirmed that the project
has met all target amortization to date.
Financial Summary
Historical average coverage ratios have remained consistent with
Fitch's rating case metrics. Under Fitch's rating case, which
incorporates increased dispatch to accelerate costs as well as a 5%
increase in operating costs and a 10% increase for major
maintenance, the average senior DSCR is 1.37x with a minimum of
0.96x during the final year. The consolidated DSCR for the
subordinate bonds averages 1.15x with a minimum of 1.12x.
PEER GROUP
Mackinaw Power, LLC (Mackinaw; BBB-/Stable) is a portfolio of
natural gas-fired plants that operates under tolling-style PPAs
similar to Plains End. However, Mackinaw benefits from adequate
cost recovery from higher dispatch. Mackinaw's average rating case
DSCR is 1.46x, resulting in the higher rating. Lower-rated projects
typically exhibit higher sensitivity to operational stresses and
have lower rating case coverages.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to a
positive rating action/upgrade:
-- For the senior bonds, improvements in cost savings, structural
revenue enhancements, or any other material improvements to
cash flow resulting in coverage exceeding 1.4x on average in
the rating case.
-- For the subordinate bonds, improvements in cost savings,
structural revenue enhancements, or any other material
improvements to cash flow resulting in a consolidated coverage
profile exceeding 1.2x in the rating case.
Factor that could, individually or collectively, lead to a negative
rating action/downgrade:
-- Sustained increased dispatch that accelerates major
maintenance, or any increase in costs, that negatively impacts
cash flow and financial metrics to below rating case
expectations.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Sovereigns, Public Finance
and Infrastructure issuers have a best-case rating upgrade scenario
(defined as the 99th percentile of rating transitions, measured in
a positive direction) of three notches over a three-year rating
horizon; and a worst-case rating downgrade scenario (defined as the
99th percentile of rating transitions, measured in a negative
direction) of three notches over three years. The complete span of
best- and worst-case scenario credit ratings for all rating
categories ranges from 'AAA' to 'D'. Best- and worst-case scenario
credit ratings are based on historical performance.
CREDIT UPDATE
September (3Q) 2020 YTD operating performance was favorable with
overall dispatch at less than 1%, leading to ancillary and energy
revenues that represented approximately 0.4% and 12.0% of total
revenues, respectively. Management attributes the lower dispatch
levels to the increased presence of hydro and renewable power
facilities and anticipates dispatch levels to remain at
approximately 1%. Plant availability remained high at 100%, and
capacity payments, the project's largest source of income, remained
stable at about 88.0% of total revenues. Fitch views favorably that
the project has continued benefiting from a low capacity factor as
sustained increases in dispatch and resulting energy sales may not
fully compensate for the increases in associated maintenance
costs.
YTD operating results through October 2020 show that the project's
operational and financial performance has remained stable. Total
operating revenues have remained within 0.2% of budget at $20.8
million, while operating expenses have remained under budget. The
project's availability has remained strong at 100% and capacity
factor has tracked closely to the fiscal 2020 budget. Fitch views
Plains End's performance favorably, and believes that the project's
fiscal 2020 performance is likely to represent another year of
solid financial and operational performance.
Fitch is awaiting final results for 4Q20; however, 3Q20 YTD
performance led to a Fitch-calculated DSCR of 1.36x (senior) and
1.11x (consolidated). The project is poised to perform
approximately at the Fitch base case level for fiscal 2020, if the
project's solid performance persisted through the close of 4Q20.
The project's FY 2019 performance remained strong with financial
and operational performance tracking quite closely to budget.
Capacity factors remained under 1%, availability averaged 99.8%,
and dispatch remained at low historical levels of roughly 1%. These
favorable operating conditions led to revenues of $24.9 million,
and expenses remained under budget at roughly $9.7 million.
Additionally, the project's planned deposit into its major
maintenance reserve account was made in accordance with budget,
experiencing no unplanned escalation. This combination of events
translated to a Fitch-calculated DSCR of 1.37x (senior) and 1.12x
(consolidated). Fitch views the project's FY 2019 performance
favorably.
Plains End completed the remaining 12,000-hour overhaul in January
2020, representing the last planned major maintenance through the
life of the project's PPAs. All major maintenance was covered under
the project's long-term service agreement. The scheduled nature of
the final overhaul minimized the potential impact to availability.
Management has advised that any further major maintenance would
require the plant's running hours to increase such that capacity
factor reaches a level of 4%-5% over a duration of several years.
As such, there are no further major overhauls expected for PEI and
PEII over the remaining debt term due to the expected low dispatch
of the project. Management is not planning to make further deposits
into the project's major maintenance reserve account (MMRA). The
project's current MMRA balance is currently around $1.3 million,
and management believes that amount is more than sufficient for any
other maintenance activities through the tenor of the PPAs. Should
it become necessary, additional funds could be deposited into the
account.
Plains End entered into a new O&M agreement with its current
provider, North American Energy Services (NAES), on January 2021
given that the prior agreement reached its maturity. The
contractual mechanisms and protections afforded under the agreement
remain substantially the same relative to the prior O&M agreement.
Further, Plains End expects to receive the same level of parts and
service from Wartsila, the engine manufacturer.
FINANCIAL ANALYSIS
Fitch's base case assumes a forced outage rate of 0.8%, 99.2%
availability, an average heat rate of 9,036 Btu/kWh, consolidated
capacity factor of 1.6%, and a 2.5% cost escalator. The resulting
profile produces an average senior DSCR of 1.40x and minimum of
0.99x. The final year of repayment is adequately supported by
liquidity available in the debt service reserve account. On a
consolidated basis for evaluation of the subordinate bonds, the
DSCR averages 1.18x with a minimum of 1.15x.
Fitch's rating case assumes a forced outage rate of 1.0%, 99.0%
availability, consolidated capacity factor of 1.6%, and elevated
costs 5.0% above the base case. The resulting profile produces an
average senior DSCR of 1.37x and minimum of 0.96x and, for the
subordinate bonds, an average consolidated DSCR of 1.15x and a
minimum of 1.12x.
Asset Description
Plains End consists of two peaking facilities located in Arvada,
Jefferson County, Colorado with a combined capacity of 228.6MW,
used primarily as a back-up for wind generation, as well as other
generation sources. The project is indirectly owned by Tyr Energy
(50%), John Hancock (35%) and Prudential (15%). Combined cash flows
from both plants service the obligations under the two bond
issues.
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.
PT RAHAJASA: Asks NY Court to Enforce $14.5M Award vs. Indonesia
----------------------------------------------------------------
Law360 reports that a bankrupt internet provider has asked a New
York federal court to enforce a $14.5 million arbitral award
against Indonesia's communication ministry over unfulfilled
payments after laying groundwork for internet access throughout the
country.
High-speed fiber optic internet provider PT Rahajasa Media Internet
said that Badan Arbitrase Nasional Indonesia, also known as BANI
Arbitration Center, issued the $14.5 million award in 2017 and that
the company has since gone bankrupt while waiting for Indonesia to
fulfill the award. Rahajasa took out a loan from the Indonesian
state bank PT Bank Pembangunan Daerah Jawa Barat dan Banten to
finance the five project.
The case, filed Dec. 30, 2020, is PT Rahajasa Media Internet v.
Telecommunication and Informatics Financing Provider and Management
Centre, Directorate General of Post and Information Administration,
Ministry of Communication and Information, Republic of Indonesia
(S.D.N.Y. Case No. 1:2020cv11035).
PT Rahajasa Media Internet, also known as Radnet, was founded in
1994 by Roy Rahajasa Yamin. Radnet was the first internet service
provider in Indonesia.
R & R TRUCKING: To Seek Approval of 25% Plan on Feb. 23
-------------------------------------------------------
R&R Trucking, Inc., and Ricardo and Rosa Cantu are slated to seek
confirmation of their Chapter 11 Plan on Feb. 23, 2021 at 10:00
a.m.
The Debtors won approval of the explanatory Second Amended
Disclosure Statement on Dec. 23, 2020.
The Debtors estimate they can continue to operate and pay creditors
over an extended period of time. The Debtor currently receives
$39,500 per month from R&R Trucking Logistics, Inc., which is an
operating entity that is also wholly owned by debtors Ricardo and
Rosa Cantu, for the lease of the vehicles owned by R&R Trucking,
Inc. The Debtors' monthly rent receipts of $39,500, which is its
source of cash flow, have been consistent and have been sufficient
to service adequate protection payments during the pendency of the
bankruptcy. The $39,500 will be applied to creditors to fund the
Plan and will be sufficient to pay creditors over an extended
period of time under the terms of the Plan. Modest rental
increases will take place after confirmation. Beginning in Year 3
of the Debtor's Plan, the rent paid from R&R Trucking Logistics
will be increased to $40,000. In year 4, the rent will be
increased to $41,000. From years 5 through 8, rent will be
increased to $42,000.
The general unsecured claims against R&R Trucking in Class 8 and
general unsecured claims against Ricardo and Rosa Cantu in Class 14
will be paid 25%. It is projected payments to unsecured creditors
will begin within the first year following the effective date of
the Plan.
A full-text copy of the Second Amended Disclosure Statement dated
Dec. 14, 2020, is available at https://bit.ly/3nMG9nS from
PacerMonitor.com at no charge.
Attorneys for the Debtors:
William L. Hames
John W. O'Leary
Joshua J. Busey
Hames, Anderson, Whitlow & O'Leary, P.S.
601 W. Kennewick Avenue
P.O. Box 5498
Kennewick, WA 99336-0498
Tel: (509) 586-7797
Fax: (509) 586-3674
E-mail: billh@hawlaw.com
johno@hawlaw.com
About R&R Trucking
R & R Trucking, Inc., based in Pasco, WA, filed a Chapter 11
petition (Bankr. E.D. Wash. Case No. 19-00473) on March 1, 2019.
In the petition signed by Ricardo Cantu, president, the Debtor
estimated $1 million to $10 million in both assets and
liabilities.
On April 26, 2019, Ricardo and Rosa Cantu, owners of R&R Trucking,
and personal guarantors on many of R&R Trucking's obligations,
filed a Chapter 11 bankruptcy proceeding (Bankr. E.D. Wash. Case
No. 19-01089).
The two cases are administratively consolidated.
The Hon. Frederick P. Corbit oversees the case.
William L. Hames, Esq., at Hames Anderson Whitlow & O'Leary, serves
as bankruptcy counsel to the Debtors.
REALOGY GROUP: Moody's Rates New $600MM Sr. Unsec. Notes 'Caa1'
---------------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to Realogy Group
LLC's proposed $600 million senior unsecured notes due 2029. At the
same time, Moody's upgraded the existing senior secured bank credit
facility to Ba2 from Ba3 and affirmed the company's B2 Corporate
Family Rating, B2-PD Probability of Default Rating, B3 senior
secured second lien notes rating and Caa1 senior unsecured notes
rating. The Speculative Grade Liquidity rating remains SGL-2. The
outlook is stable.
Realogy plans to use the net proceeds from the new $600 million
notes issuance to refinance a portion of the existing term loan A
due 2023 and term loan B due 2025. Separately, the company intends
to amend its existing credit agreement to extend the term of all or
a portion of the remaining balance of the term loan A and its
revolving credit facility to 2025 from 2023, as well as reduce the
maintenance covenant requirement under its secured leverage ratio.
The upgrade of the senior secured bank credit facility to Ba2
reflects the issuance of new senior unsecured notes which increases
the proportional amount of the junior debt relative to the first
lien debt in Realogy's pro forma capital structure. The newly
issued notes would absorb more of the losses in a stress scenario,
helping recovery prospects of the first lien bank facility.
RATINGS RATIONALE
"Although the proposed transactions are debt and leverage neutral,
the issuances extend Realogy's debt maturity profile from 2023 to
2025 and beyond, so the plan is a positive credit and liquidity
development," said Edmond DeForest, Moody's Vice President and
Senior Credit Officer.
The B2 CFR reflects Moody's expectations for a low single digit
revenue growth rate, at least $200 million free cash flow and debt
to EBITDA of 6.3 times as of September 30, 2020 to decline and
remain below 6 times in 2021. Moody's anticipates strong recovery
in the existing home sales market nationally, including the New
York City suburbs, although not the city itself, fueled in part by
historically low interest rates and renewed interest in existing
homes from consumers since the coronavirus began to wane this
summer is expected to continue in 2021. The substantial rebound in
Realogy's operating and financial results depends in part on
adverse coronavirus-related impacts continuing to wane in 2021.
Moody's notes that strong tailwinds supporting Realogy's business
in late 2020 could reverse quickly if coronavirus-related
disruption forces real estate brokerages to cease operations again.
Profitability rates may not recover from historically low EBITA
margins around 7.5% in the 12 months ended September 30, 2020 in
2021 due to the return of around $120 million of expenses (largely
compensation and investment) temporarily eliminated during the
pandemic in 2020. Over the longer term, expected revenue growth,
operating leverage in its owned brokerage unit and permanent cost
reduction initiatives should help EBITA rates rebound toward their
historical range between 10% and 13%.
All financial metrics cited reflect Moody's standard adjustments.
Additional support is provided by a strong portfolio of brands and
leading existing homes sale brokerage market position. Realogy's
owned brokerage operations are concentrated in the largest US
markets, including most large suburban markets experiencing an
existing home sale market boom, but also in New York City, where
Realogy has a large, multi-brand owned brokerage presence and
existing home sales conditions are not as robust as elsewhere in
the country. Moody's considers the residential real estate
brokerage market volatile, cyclical and seasonal. Although
commission costs are variable, Realogy's owned brokerages have a
high degree of fixed operating costs. A high proportion of its
profits reflect home sale market activity as opposed to
less-transactional franchise fees. Realogy's leading position in
the residential real estate brokerage market positions the company
well to improve financial metrics steadily if existing home sale
volume and price growth is sustained.
Moody's expects that the residential real estate brokerage industry
will remain subject to severe financial and operating consequences
if coronavirus impacts rise further. Realogy is also under
competitive pressure from other traditional brokers that have
sought to recruit Realogy's best-performing sales people.
Competition from non-traditional technology-enabled competitors
including RedFin and Zillow, own-to-rent buyers and home flippers
has grown. Additionally, Realogy's high operating and financial
leverage could limit its flexibility if the negative impacts of the
pandemic on the existing home sale market linger for an extended
period. Moody's regards the coronavirus outbreak as a social risk
under its ESG framework, given the substantial implications for
public health and safety.
As a public company, Realogy provides transparency into its
governance and financial results and goals. The 10 person board of
directors is controlled by independent directors. Moody's expects
Realogy to maintain conservative financial strategies including
building liquidity and eschewing large debt-funded M&A or any share
repurchase activity until its financial leverage is reduced.
Additionally, Realogy does not exhibit material environmental
risks.
The Ba2 rating on the senior secured obligations reflects their
priority position in the capital structure and a Loss Given Default
assessment of LGD2. The debt is secured by a pledge of
substantially all of the company's domestic assets (other than
excluded entities and excluding accounts receivable pledged for the
securitization facility) and 65% of the stock of foreign
subsidiaries. The Ba2 rating, three notches above the CFR, benefits
from loss absorption provided by the junior ranking debt and
non-debt obligations.
The B3 rating on the senior secured second lien notes reflects
their subordination to the existing first lien senior secured bank
facilities, seniority to the senior unsecured notes, and a LGD
assessment of LGD4. The second lien note is secured by a second
lien on substantially all of the company's domestic assets (other
than excluded entities and excluding accounts receivable pledged
for the securitization facility) and 65% of the stock of foreign
subsidiaries.
The Caa1 rating on the senior unsecured notes reflects the B2-PD
PDR and an LGD assessment of LGD5. The LGD assessment reflects
effective subordination to all the secured debt. The senior notes
are guaranteed by substantially all of the domestic subsidiaries of
the company (excluding the securitization subsidiaries).
The SGL-2 liquidity rating reflects Realogy's good liquidity
profile. As of September 30, 2020, Realogy had a cash balance of
$380 million. Moody's anticipates at least $200 million of free
cash in 2021 and full availability under the company's $1.425
billion revolving credit facility. Realogy's cash flow is seasonal,
with negative cash flow typically in the 1st fiscal quarter.
Moody's expects good headroom under the maximum senior secured net
debt to EBITDA (as defined in the facility agreement) financial
maintenance covenant applicable to the secured first lien debt over
the next year. Realogy has $62 million of required term loan
principal payments in 2021.
The stable outlook reflects Moody's expectations for debt to EBITDA
below 6 times, good liquidity and creditor-friendly financial
strategies emphasizing repayment of debt. The stable outlook also
anticipates Realogy will repay or refinance its 2023 debt
maturities well in advance of their due dates.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Moody's expects Realogy will
sustain debt to EBITDA below 5.5 times, free cash flow to debt of
at least 5%, good liquidity, and balanced financial strategies,
including an emphasis upon repaying debt and extending its debt
maturity profile.
The ratings could be downgraded if Moody's anticipates debt to
EBITDA will remain above 6.5 times, diminished liquidity, or
aggressive financial strategies featuring large, debt-financed
acquisitions or shareholder returns.
Affirmations:
Issuer: Realogy Group LLC
Corporate Family Rating, Affirmed B2
Probability of Default Rating, Affirmed B2-PD
Senior Secured Regular Bond/Debenture, Affirmed B3 (LGD4) from
(LGD5)
Senior Unsecured Regular Bond/Debenture, Affirmed Caa1 (LGD5)
Assignments:
Issuer: Realogy Group LLC
Senior Unsecured Regular Bond/Debenture, Assigned Caa1 (LGD5)
Upgrades:
Issuer: Realogy Group LLC
Senior Secured Bank Credit Facility , Upgraded to Ba2 (LGD2) from
Ba3 (LGD2)
Outlook Actions:
Issuer: Realogy Group LLC
Outlook, Remains Stable
Realogy Holdings Corp. (NYSE: RLGY) is the leading and most
integrated provider of U.S. residential real estate services,
encompassing franchise, brokerage, relocation, and title and
settlement businesses as well as a mortgage joint venture.
Realogy's diverse brand portfolio includes Better Homes and
Gardens(R) Real Estate, CENTURY 21(R), Coldwell Banker(R), Coldwell
Banker Commercial(R), Corcoran(R), ERA(R), and Sotheby's
International Realty(R). The company operates in three segments:
franchise, brokerage, and title. Moody's expects 2021 revenues of
over $6 billion.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
REALOGY GROUP: S&P Rates New $400MM Senior Unsecured Notes 'B-'
---------------------------------------------------------------
S&P Global Ratings assigned its 'B-' issue-level rating and '6'
recovery rating to Madison, N.J.-based real-estate services
provider Realogy Group LLC's proposed $400 million senior unsecured
notes due 2029. The '6' recovery rating indicates S&P's expectation
for negligible (0%-10%; rounded estimate: 5%) recovery for the
unsecured noteholders in the event of a payment default.
S&P said, "We expect Realogy to use a significant proportion of the
issuance proceeds to repay its first-lien secured term debt (term
loan A and B), which will ultimately increase the recovery
prospects for its second-lien noteholders. Therefore, we are also
raising our issue-level rating on its existing secured second-lien
notes due 2025 to 'B' from 'B-' and revising our recovery rating to
'5' from '6'. The '5' recovery rating indicates our expectation for
modest (10%-30%; rounded estimate: 15%) recovery for the secured
notes."
"The transaction does not affect our 'B+' long-term issuer credit
rating or stable outlook on Realogy. We believe the company will
continue to benefit from stable housing demand in 2021, leading it
to sustain debt leverage in the 5x area while generating good free
cash flow to support its strong liquidity position."
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario contemplates a payment default
occurring in 2025 due to a steep decline in EBITDA and market
share, combined with its inability to refinance a significant
portion of its capital structure. Specifically, persistent declines
in transaction volume driven by a prolonged U.S. recession and
increasing competitive pressures, particularly from new entrants
that disrupt the traditional home buying model are likely factors.
-- In a hypothetical default, S&P believes the company's lenders
would pursue a reorganization rather than a liquidation and thus
apply a 6.5x multiple to S&P's emergence EBITDA to reflect
Realogy's diverse brand portfolio and extensive agent network.
-- Realogy's capital structure currently comprises a senior
secured credit facility that includes a $1.425 billion revolving
credit facility due 2023, a $694 million term loan A due 2023, and
a $1.05 billion term loan B due 2024. In addition, the company has
$550 million of senior secured second-lien notes due 2025, senior
unsecured notes totaling $957 million maturing between 2023-2027,
and an unrated $200 million accounts-receivable securitization
program (Cartus Relocation).
-- The senior secured credit facility is secured by substantially
all of the company's assets and domestic subsidiaries and 65% of
the capital stock of its foreign subsidiaries, subject to certain
exceptions. The senior secured notes due 2025 are backed by the
same collateral package but on a second-lien basis to the credit
facilities and rank senior to the unsecured notes. The new 2029
senior unsecured notes will rank pari passu with the existing
unsecured notes and will be subordinated to all of the company's
existing and future secured debt.
Simulated default assumptions
-- Simulated year of default: 2025
-- EBITDA at emergence: $465 million
-- EBITDA multiple: 6.5x
Simplified waterfall
-- Net enterprise value (after 5% administrative expenses): $3.03
billion
-- Obligor/nonobligor valuation split: 88%/12%
-- Priority claims: $208 million
-- Estimated first-lien secured debt: $2.47 billion
-- Value available for first-lien claims: $2.55 billion
--Recovery expectations: 90%-100% (rounded estimate: 95%)
-- Estimated second-lien secured debt: $571 million
-- Collateral value available for second-lien claims: $73 million
-- Recovery through deficiency claims: $31 million
-– Recovery expectations: 10%-30% (rounded estimate: 15%)
-- Estimated senior unsecured debt claims/deficiency claims from
first- and second-lien claims: $1,405 million/$498 million
-- Value available to unsecured claims: $119 million
-– Recovery expectations: 0%-10% (rounded estimate: 5%)
Note: All debt amounts include six months of prepetition interest.
RHA STROUD: Chapter 11 Cases Dismissed
--------------------------------------
Judge Sarah A. Hall of the United States Bankruptcy Court for the
Western District of Oklahoma dismissed RHA Stroud, Inc. and RHA
Anadarko, Inc.'s Chapter 11 cases and denied the Debtors' motion to
use cash collateral as moot.
The FG Group consisting of Rural Hospital Acquisition, LLC, First
Physicians Realty Group, LLC, First Physicians Business Solutions,
LLC, First Physicians Services, LLC, and First Physicians
Resources, LLC, sought the dismissal of the Chapter 11 cases.
Debtors operate two licensed "Critical Access Hospitals," one in
Stroud, Lincoln County, Oklahoma, and one in Anadarko, Caddo
County, Oklahoma. Each Debtor has 25 beds and emergency rooms.
Charles Eldridge acquired Debtors in 2011. Eldridge subsequently
contributed his equity interests in Debtors to One Cura Wellness,
Inc. Debtors are currently owned 100% by One Cura. Eldridge is
the president and a director of Debtors and is also the founder and
sole employee of One Cura. One Cura's only source of income is a
"director's fee" paid by Debtors to One Cura. One Cura pays
Eldridge's salary, currently $225,000 annually, as its only
employee.
As part of the purchase in 2011, Debtors executed notes in favor of
RH Acquisition, which were later amended and restated in 2015, as
follows: $5,928,028.05 by Debtor Anadarko and $8,097,684.06 by
Debtor Stroud. The Notes are interest only, with quarterly
payments, and the principal amounts are due and payable in full on
March 31, 2021. To secure the Notes, Debtors granted blanket liens
on all Hospital assets to RH Acquisition including accounts
receivable and rights of Debtors to payment of money or any other
form of consideration.
Debtors operate on land and in facilities that are owned by FP
Realty. Debtors entered into a lease with FP Realty for the
Hospital land and facilities dated April 1, 2011. The Lease has a
20-year primary term commencing April 1, 2011, and is renewable.
The current aggregate monthly rent under the Lease owed by Debtors
to FP Realty is approximately $110,000 per month.
The Hospitals' state licenses to operate are tied to the Hospitals'
physical locations. The Medicare designations as Critical Access
Hospitals are also tied to the physical locations and state
licenses. Neither the Critical Access Hospital designations nor
the state licenses are transferrable. Debtors cannot reorganize
without the long-term Lease of the physical locations and
facilities.
Debtors also entered into multiple service contracts with the
various members of the FP Group. Debtors also entered into multiple
contracts with the various members of the FP Group including: (a)
FP Business — Management Services Agreements to furnish
management and support services to Debtors; (b) FP Resources —
Staff Leasing Agreements to lease clinical, administrative, and
other personnel, physicians, and senior executives to Debtors; (c)
FP Services — Ancillary Services Agreements to furnish
information technology, diagnostic testing services, electronic
health records, software and systems, management of professional
services, and other ancillary services to Debtors.
The MSAs with FP Business provide that FP Group is not obligated to
pay third-party vendors unless there are sufficient funds to do so.
As a result of the Service Contracts: (a) FP Group handles all
day-to-day operations and transactions for Debtors; (b) FP Group
prepares the Hospitals' financial statements and provides them to
Eldridge monthly; (c) Debtors have no employees as all physicians,
medical staff, and other employees are retained by FP Group; (d)
revenues generated by the Hospitals are swept daily by FP Group and
used to pay third-party vendors and a portion of its fees under the
Service Contracts; (e) FP Group submits to Eldridge weekly cash
disbursements by vendor, the cost report and supporting financial
documentation, and a daily status on the Hospitals; and (f) FP
Group maintains and has possession of Debtors' books and records.
Debtors generate significant revenues and cash flow but are not
profitable and have not been so since 2014. Debtors have two
sources of active cash flow: cash and check by patients deposited
directly to the respective operating account for each Debtor and
wires directly into Debtors' lockbox accounts from insurance,
Medicare, Medicaid, Veterans Administration benefits, and merchant
services. A significant portion of Debtors' revenues is derived
from Medicare reimbursements. Debtors are reimbursed based on cost
reports submitted to Medicare once a year containing a breakdown of
the reimbursable expenses. It is critical that the costs reports be
correct and are generally prepared by an expert in Medicare cost
reimbursement. However, because of the structure of Debtors'
operations and One Cura's lack of involvement therein, Debtors are
entirely dependent on FP Group to provide the necessary accounting
information to complete the cost reports.
Historically, Debtors' expenses and costs have exceeded cash flow,
so FP Group prioritized payment of Debtors' third-party vendors,
suppliers, and One Cura over the interest, rent payments, and fees
due FP Group under the various contracts with Debtors, and then
paid itself whatever was left. After payment of third-party
invoices, One Cura's director's fee, and professional fees, there
was never enough cash flow to pay FP Group in full. FP Group made
the decision to not pay or otherwise defer its payments; neither
Debtors nor One Cura directed such action. FP Group prioritized
any payment it received to its fees under the Service Contracts and
then to interest on the Notes to try to keep the Notes current.
Eldridge never directed any different payment priority of FP
Group's fees and debts.
Debtors have never paid any rent under the Lease as there has not
been sufficient cash flow. They have never paid any principal on
the Notes and only minimal interest, again because there was always
insufficient cash flow to pay third-party vendors, One Cura, FP
Group's fees under their Service Contracts, rent under the Lease,
and Note payments.
As of September 30, 2018, as part of an audit, Debtors recognized,
and FP Group confirmed, the following amounts to be outstanding on
the Notes and Lease: Debtor Anadarko Principal: $5,881,443 Lease
Payable: $5,600,421 Interest: $725,580 Accounts Payable: $4,754,980
Debtor Stroud Principal: $8,050,797 Lease Payable: $4,536,105
Interest: $663,025 Accounts Payable: $3,923,772,
Since 2011, FP Group's fees steadily increased, some years more
than 30-40%. This increase was due in part to increased
collections as fees charged by FP Group were tied to revenue
collections, and revenue increased due to increased operations
which required more staffing and services as the Hospitals were
managing more patients. As a result, One Cura, Debtors, and FP
Group began having discussions to renegotiate and lower costs to
Debtors under the Service Contracts.
In February 2019, Debtors and FP Group were negotiating a Staff and
Provider Leasing Agreement, which was unsigned although Debtors
claim it was executed and held in escrow until the other agreements
were renegotiated and signed. The Amended Staffing Agreement
provided that FP Group shall "cure" the accrued, unpaid interest on
the Notes and the unpaid rent on the Lease by the end of the
Initial Term (February 2023). The Amended Staffing Agreement was
raised by Debtors and One Cura as a "Hail Mary" to defeat the
accrued and unpaid interest on the Notes and rent payments under
the Lease. The Amended Staffing Agreement further provided for
payment to One Cura of $62,500 per month per Debtor for oversight
fees (reduced from the monthly $100,000 director's fee that was
being paid to One Cura but above the original $25,000 a month
director's fee previously paid to One Cura). No other contract
references the $62,500 per month per Debtor amount for One Cura's
director's fees. The $62,500 per month per Debtor director's fee
was authorized and paid by FP Group prior to and after the date of
the Amended Staffing Agreement.
As of September 30, 2019, Debtors continued to recognize, and FP
Group confirmed, the Lease payable balances and the accounts
payable owed to FP Group under the Lease by Debtor: Debtor Anadarko
— $5,704,000; and Debtor Stroud $4,620,000.
In late 2019, as a continuation of their efforts to renegotiate and
lower costs to Debtors under the Service Contracts, FP Group and
One Cura met. The meeting did not go well as One Cura wanted more
money in the form of an increased director's fee and a joint
venture arrangement with FP Group which is not permitted by
Medicare.
Subsequently, Eldridge renegotiated Debtor Anadarko's agreement
with Southern Plains Medical Group (which managed and staffed
Debtor Anadarko's surgery department). The new agreement required
Debtor Anadarko to pay Southern Plains prior to charts being
completed. As a result, Debtor Anadarko was required to pay
Southern Plains without first confirming it can bill for the
charges, putting the risk of non-reimbursement on Debtors rather
than Southern Plains.
In January 2020, Eldridge, without input from FP Group, reached out
to third parties about possibly obtaining new management for the
Hospitals, specifically Sean Kirrane (former CEO of FP Group),
Cohesive Healthcare Solutions, and Southern Plains, but nothing
concrete developed at the time.
In January 2020, FP Group ceased remitting the monthly director's
fee to One Cura and also ceased remitting payment of One Cura's
professionals' fees.
On February 17, 2020, RH Acquisition declared the payment of the
Notes to be in default and the unpaid principal balance to be
immediately due and payable, together with the unpaid accrued
interest through February 14, 2020, and demanded immediate payment
as follows: Debtor Stroud Principal $8,050,797.26 Interest
$719,315.10; Debtor Anadarko Principal $5,881,442.78 Interest
$1,010,547.82. On February 17, 2020, FP Realty also declared
defaults under the Lease and demanded immediate payment of the
unpaid, outstanding rent of $10,324,000. Debtors did not respond
to either the Note Demand Letters or the Lease Demand Letter, and
Debtors did not remit payment on the Notes or the Lease.
First Physicians then filed a lawsuit against Debtors seeking money
judgment on the Notes and the Lease, to evict Debtors from the land
and facilities, and to appoint a receiver in the District Court of
Lincoln County, State of Oklahoma. Eldridge viewed the State Court
Action as a threat to Debtors' ability to keep operating the
Hospitals and providing health services in Stroud, Anadarko, and
their surrounding communities as he believed the proposed receiver,
David Rhoades, would liquidate and sell the Hospitals. FP Group
asked for the appointment of a receiver because a receiver was the
best way to protect patients, the Hospitals, and their licenses
during the litigation. A receiver needed to be in place before FP
Group obtained an order of eviction to protect the licenses, the
provider agreements, and the patients in the Hospitals.
On September 14, 2020, the District Court held a hearing on RH
Acquisition's and FP Realty's motion for appointment of a receiver
in the State Court Action. Following the hearing, the District
Court entered its Order on September 25, 2020 in which the Court
found Debtors to be insolvent, the Hospitals to be running smoothly
and efficiently, the Notes and the Lease to be in default with
amounts "undisputably" owed thereunder, and the relationship
between FP Group and Debtors to be broken down and "toxic." As a
result, the District Court concluded a receiver was necessary to
"neutralize the parties" during the State Court Action in order "to
aid the [H]ospitals to continue their successful operations." The
Receiver Order further directed the parties to submit an agreed
order appointing a receiver.
Debtors filed their chapter 11 bankruptcy cases on Sunday, October
25, 2020. According to Eldridge, Debtors sought bankruptcy
protection because: (i) Debtors' losses were impacting Debtors'
mission as they could not expand services (because FP Group refused
to expand); (ii) operating costs kept increasing as FP Group's fees
increased beyond Debtors' cash flow and FP Group refused to
renegotiate; (iii) Debtors needed to reject the FP Group contracts;
(iv) a receiver had been appointed which impaired Debtors' mission
to provide quality health care to their communities; and (v)
bankruptcy would turn off FP Group's sweep of Debtors' lockbox
accounts and allow money to be paid to One Cura and its
professionals.
Prior to the Bankruptcy Cases, FP Group paid the Hospital vendors
current in the ordinary course of business, and no vendors had
threatened action against or demanded different terms from the
Hospitals pre-bankruptcy. In fact, the Hospitals had very good
vendor relations pre-bankruptcy. The only payments FP Group
disputed and withheld pre-bankruptcy were payments to One Cura and
its professionals.
On the Petition Date, the aggregate amount owed by Debtors on the
Notes totaled $14,025,712.11, exclusive of accrued and unpaid
interest. The amounts due under the Lease as of November 30, 2020,
are: Debtor Anadarko $6,352,936; and Debtor Stroud $5,145,611.
Debtors made no effort to forewarn, much less coordinate with, FP
Group regarding the filing of the Bankruptcy Cases notwithstanding
that FP Group operates and manages Debtors. Adrian Reeder, FP
Group's CFO, learned of the bankruptcy filings through a colleague
who received a news article on October 26, 2020.
Neither Debtors nor One Cura reached out to Debtors' vendors in
advance of the filing of the Bankruptcy Cases which is not
surprising given that FP Group, rather than Eldridge and One Cura,
has the relationships with Debtors' vendors and service providers.
As a result, vendors and suppliers were surprised and took actions
to protect themselves upon learning of the Bankruptcy Cases, such
as shutting down service, freezing accounts, and demanding payment
in full on post-petition accounts. This took place during a time
of high occupancy in the Hospitals — and all hospitals — due to
the Covid-19 pandemic. If the Hospitals were unable to get the
supplies and services needed for patients, then the Hospitals would
need to transfer the patients to other hospitals; however, due to
the Covid-19 pandemic, the Hospitals were unable to transfer due to
high occupancy rates, thus putting patients in jeopardy. FP Group
was put in the untenable position to "beg" for supplies and
services and was required to make immediate payment for services
and supplies to ensure patient protection.
The bankruptcy filing by Debtors also caused a contractual payment
due to Southern Plains not to be paid; such payment would have been
made in the ordinary course but for the bankruptcy filing. Debtors
do not have sufficient cash flow post-petition to cover their
operating expenses, Note payments, Lease payments, professional
payments, UST fees, and patient ombudsman's fees.
The Court approved Debtors' continued use of cash collateral at the
conclusion of a hearing held on November 2, 2020. On November 11,
2020, this Court entered the Order Authorizing the Hospitals'
Interim Use of Cash Collateral and Scheduling a Final Hearing. The
Interim Cash Collateral Order provides for FP Group to continue to
act as paying agent for Debtors and to compile and submit
third-party invoices to Eldridge for payment approval. Once
submitted, Eldridge has 36 hours to review and approve the invoices
for payment. Eldridge has not satisfied this obligation in at
least two, if not three, instances post-petition.
FP Group filed the Motion to Dismiss on November 6, 2020.10. On
November 7, 2020, one day after the Motion to Dismiss was filed,
Eldridge contacted Kirrane to determine his interest in providing
management and staffing services to Debtors. Kirrane had previously
spoken to Eldridge in January 2020 in general terms but there had
been no follow-up. Nine days later, by motions filed on November
16, 2020, Debtors sought to reject the FP Contracts, excepting only
the Lease, and to enter into new management services agreements
with Arcadia Health Partners as manager of the Hospitals.
Arcadia is a company formed by Kirrane11 in November 2020, after
the Motion to Dismiss was filed. Arcadia is not currently
registered to do business in Oklahoma, has no employees, no
contracts, no cash on hand, no office other than Kirrane's home,
and no business at the time of the hearing.
The Arcadia Proposal proposes to bring together several key
individuals instrumental, per Kirrane, for the way the Hospitals
operate today, Cohesive and Southern Plains, in a joint venture of
sorts to operate the Hospitals. Kirrane has no contracts with any
of the individuals, Cohesive, or Southern Plains committing them to
the "gentlemen's agreement," the timing thereto, or the pricing.
Additionally, the Arcadia Proposal would affect a wholesale
replacement of the management, physicians, medical staff, and all
other employees at Debtors notwithstanding the excellent patient
care being provided by the current staff as per Eldridge. The
Arcadia Proposal includes lowering some costs through reduced
management fees and assumes the savings from the lowered costs will
be allocated to new, more productive service lines, such as
outpatient surgery or opening the surgery center at Stroud. This
would require an investment in personnel until the Medicare cost
reimbursement catches up. The Arcadia Proposal reduces costs to
Debtors through payment of lower management fees. While FP Group
gets reimbursed for actual costs plus a 100% markup, Arcadia will
get reimbursed for actual costs plus a 75% markup.
No financing is lined up or even preliminarily lined up but Debtors
and Kirrane intend to look for donors and debtor-in-possession
financing. However, Debtors first need a plan to lower costs before
focusing on financing.
Kenneth DeGraw, with the Debtors' auditor WithumSmith+Brown, P.C.,
prepared a 13-week cash budget for Debtors. However, DeGraw has no
experience with Medicare reimbursement, never worked with a
Critical Access Hospital before, and did not investigate these
matters prior to preparing the 13 week cash budget supporting
Debtors' use of cash collateral. DeGraw's comparison of FP Group's
costs to the Arcadia Proposal costs only looks at the cost savings
while using the revenue levels generated by FP Group under its
existing Service Contracts notwithstanding approximately 65% of
Debtors' revenues being tied to costs subject to Medicare cost
reimbursement rules.
DeGraw's 13 week budget also includes no Lease payments to FP
Realty and no adequate protection to RH Acquisitions. Being a cash
budget, it also fails to include accrued but unpaid fees and
expenses of Debtors' professionals in the Bankruptcy Cases. Even
without these expenses, however, the 13-week cash budget reflects
at the end of the 13 weeks Debtors will have unpaid accrued
expenses in excess of $7.9 million just in management fees due FP
Group for which no provision for payment has been made other than
the re-allocation of costs savings. Under Debtors' own proposed
budget, Debtors become more administratively insolvent every week
without payment of professional fees, rent under the Lease, or
interest on the Notes.
Judge Hall said that "the evidence before the Court was that
Debtors commenced the bankruptcy cases with $3.1 million in cash on
hand and that substantially less, although not quantified, remains
on hand today. In addition, Debtors are not paying interest on the
Notes, rent under the Lease, or any professional fees. However,
all of these expenses are accruing and will continue to accrue.
Similarly, Debtors are not paying FP Group's management fees in
full, and these also continue to accrue on a post-petition basis.
And, Debtors will soon have to pay UST quarterly fees based on
disbursements in these Bankruptcy Cases... All of these expenses
are also administrative expenses subject to priority in payment.
Where, during the pendency of a bankruptcy case, a debtor's assets
decline, cash declines, and administrative expenses and
professional fees accrue, there has been a substantial loss to the
estate... To add insult to injury, Debtors have not, and currently
do not have sufficient post-petition cash flow to cover operating
expenses, Note payments, Lease payments, professional payments, UST
fees, and patient ombudsman fees. Negative cash flow alone can
establish a continuing loss or diminution of the estate under
Section 1112(b)(4)(A)... Clearly, Debtors' estates are suffering a
substantial and continuing loss or diminution in value during these
bankruptcy cases."
"Debtors clearly expressed their motive was to protect the equity
interests of One Cura and its receipt of director's fees and
payment of its professionals at the cost of third-party vendors
who, prior to the Petition Date, had been paid in the ordinary
course of business and were exerting no pressure on Debtors, and FP
Group. Debtors want to preserve the cash generating Hospitals for
their own benefit rather than give up control to RH Acquisition and
lose the Lease to FP Realty, neither of which has received payment
since 2011. Against these facts, Debtors' motives are clear, bad
faith is found," Judge Hall added.
The case is In re: RHA Stroud, Inc., Chapter 11, Debtors, Case No.
20-13482-SAH, (Bankr. W.D. Okla.). A full-text copy of the Order
(A) Granting FP Group's Amended Motion to Dismiss or Abstain, with
Brief, and With Notice of Opportunity For Hearing, and (B) Denying
Debtors' Motions for Entry of Interim and Final Orders (i)
Authorizing the Hospitals to Use Cash Collateral; (ii) Granting
Conditional Adequate Protection to the Secured Party, (iii)
Scheduling a Further Interim Hearing; (iv) Scheduling a Final
Hearing, and (v) Granting Related Relief, dated December 30, 2020,
is available at https://tinyurl.com/yxeugogx from Leagle.com.
About RHA Stroud LLC
RHA Stroud Inc. and RHA Anadarko, Inc. operate two hospitals in
rural Oklahoma -- the Stroud Regional Medical Center in Stroud,
Okla., and The Physicians' Hospital in Anadarko, in Anadarko, Okla.
They are the largest non-profit health-care system in Lincoln and
Caddo counties, with combined annual revenues of $94.3 million in
fiscal year 2019. Both hospitals are designated critical care
facilities.
One Cura Health, formerly known as One Cura Wellness, is the parent
non-profit organization.
RHA Stroud and RHA Anadarko sought Chapter 11 protection (Bankr.
W.D. Okla. Case Nos. 20-13482 and 20-13483) on Oct. 25, 2020. RHA
Stroud was estimated to have $10 million to $50 million in assets
and $50 million to $100 million in liabilities.
Akerman LLP, led by David W. Parham, Esq., and Esther McKean, Esq.,
is the Debtors' bankruptcy counsel. Rubenstein & Pitts, PLLC, led
by Michael A. Rubenstein, Esq., is the Oklahoma counsel.
RONNA'S RUFF: S&T Objects to 5-Year Reamortization of Vehicle Loans
-------------------------------------------------------------------
S&T Bank objects to approval of the Disclosure Statement and to
confirmation of the Chapter 11 Plan of Debtor Ronna's Ruff Bark
Trucking, Inc.
S&T Bank is a party-in-interest in this case as it is a secured and
unsecured creditor of the Debtor. The Debtor has stipulated and
agreed that it is obligated to S&T Bank.
The Disclosure Statement indicates that, for Class 1a claims, for
the collateral that the Debtor intends to retain, the secured
claims of S&T shall be paid in full over 60 months by way of
graduated monthly installment payments, including interest at
5.25%. For Class 1b claims, for the collateral that the Debtor
intends to sell or surrender, the secured claims of S&T shall be
paid from the sale proceeds of any auction or private sale, with
any surplus to be applied to Claim No. 4.
S&T Bank claims that it is unclear from the Disclosure Statement
whether the vehicles under the Class 1a claim will have much value
at the end of the 60 months. Therefore, S&T is unable to make an
informed decision about whether the proposed reamortization of the
loan over 60 months is reasonable.
S&T Bank points out that it is unclear from the Disclosure
Statement whether the auction to be conducted by BigIron will pay
S&T's Class 1b claim in full. S&T also holds a blanket security
interest in all assets of the Debtor, including all inventory,
chattel paper, accounts, equipment and general intangibles.
Counsel for S&T has also asked the auctioneer to provide additional
information as to whether the vehicles that are being sold pursuant
to the Debtor's motion to sell will result in a full payoff of
S&T's liens on the vehicles. As of the date of the filing of this
objection, the auctioneer is still in the process of obtaining this
information.
S&T Bank objects to the Debtor's proposed treatment of any
deficiency balance under the Class 1b claim as a general, unsecured
claim as S&T's loan documents contain cross-collateralization
language. S&T also holds a blanket security interest in all assets
of the Debtor, including all inventory, chattel paper, accounts,
equipment and general intangibles.
S&T Bank asserts that without any reliable information about the
value of the vehicles at the end of 60 months, or the requested
information from the auctioneer, S&T is unable to agree to the
current treatment under the Plan.
A full-text copy of S&T Bank's objection dated January 7, 2021, is
available at https://bit.ly/3bmeeaR from PacerMonitor.com at no
charge.
Attorney for S&T Bank:
GRENEN & BIRSIC, P.C.
Elizabeth L. Slaby, Esquire
PA ID No. 209503
One Gateway Center, 9th Floor
Pittsburgh, PA 15222
412-281-7650
E-mail: bslaby@grenenbirsic.com
Small Business Plan
The Debtor filed a Chapter 11 Small Business Plan and a Disclosure
Statement on Nov. 23, 2020.
As per the Debtor’s President and shareholder, Erick Merryman,
the Debtor intends to downsize operations by auctioning and/or
selling certain vehicles, thereby reducing overhead. The Debtor
intends to retain BigIron Online Auction Co. to conduct an online
auction or auctions of certain vehicles for the purposes of
reducing its debt to S&T Bank. The Debtor may also enter into a
private sale prior to the engagement of BigIron. The Debtor then
intends to reamortize its remaining vehicle loans over the life of
a five-year (60 month) plan to render regular contractual payments
more feasible.
General unsecured and unsecured tax claims will be paid the
approximate amount of 5 percent of the current Class 4 Claims, or
approximately $8,903 total, over the course of five years after the
Effective Date. The Debtor will make an initial pro rata
distribution in cash ($2,968) three years after the Effective Date
of the Plan and equal annual pro rata distributions thereafter.
A copy of the Disclosure Statement is available at
https://bit.ly/38tkSdA
About Ronna's Ruff Bark Trucking
Ronna's Ruff Bark Trucking, Inc., is in the business of logging and
over-the-road hauling.
Ronna's Ruff Bark Trucking, based in Shippenville, Pa., filed a
Chapter 11 petition (Bankr. W.D. Pa. Case No. 19-11167) on Nov. 25,
2019. In the petition signed by Erick Merryman, the owner, the
Debtor was estimated to have $1 million to $10 million in both
assets and liabilities.
The Honorable Thomas P. Agresti is the presiding judge. Michael S.
JanJanin, Esq., at Quinn Buseck Leemhuis Toohey & Kroto, Inc.,
serves as bankruptcy counsel.
No committee, examiner, or trustee has been appointed in the case.
RUBIO'S RESTAURANTS: Emerges From Chapter 11 Bankruptcy
-------------------------------------------------------
On Dec. 22, 2020, the U.S. Bankruptcy Court for the District of
Delaware entered an order confirming the Second Amended Joint
Prepackaged Chapter 11 Plan of Reorganization of Rubio's
Restaurants, Inc., and its debtor affiliates.
The effective date of the Plan occurred on Dec. 30, 2020 (the
"Effective Date"), according to a notice served by the Debtors'
counsel. Requests for payment of administrative claims, Other
Priority Claims and General Unsecured Claims must be filed with
claims agent Bankruptcy Management Solutions Inc. (d/b/a Stretto)
by Feb. 16, 2021, the first business day that is the 45th after the
Effective Date. Requests for payment of allowed Governmental Unit
Claims must be filed with the Notice and Claims Agent on or before
April 26, 2021, which is the first Business Day that is the 180th
day after the Petition Date.
Under the Plan, Holders of Allowed General Unsecured Claims will be
entitled to their pro rata share of a distributions pursuant to
Article IV of the Plan only if such holders elect to opt-in and be
bound by the Releases set forth in Article IX of the Plan by
appropriately completing and filing with the Notice and Claims
Agent the opt-in and proof of claim form on or before the Claims
Bar Date. Holders will be eligible to receive their pro rata share
of the Claims Cash Pool (after deducting all fees and expenses
incurred by the General Unsecured Claims Administrator) on account
of their Allowed General Unsecured Claims; provided that no holder
of a General Unsecured Claim will be entitled to receive more than
18% of the Allowed amount of its General Unsecured Claim.
Under the Debtors' Plan, Class 3 Secured Loan Claims are impaired.
Each Holder thereof shall receive their pro-rata share of: (A) a
portion of the $52 million exit credit facility in a principal
amount equal to $37 million and (B) the interests of reorganized
MRRC Hold Co.
Class 4 General Unsecured Claims are impaired. On the Effective
Date, all General Unsecured Claims will be cancelled, released, and
discharged, and will be of no further force or effect. Therefore,
Holders of General Unsecured Claims will not receive any
distribution on account of those claims.
Notwithstanding the above treatment, each Holder of an Allowed
General Unsecured Claim will be eligible to receive the
consideration being provided to Holders of Allowed General
Unsecured Claims that timely elect to opt-in to the releases, as
described in Article IV of the Plan.
On the Effective Date, all Equity Interests will be cancelled
without any distribution on account of such interests.
A full-text copy of the Second Amended Joint Prepackaged Chapter 11
Plan of Reorganization dated Dec. 14, 2020, is available at
https://bit.ly/34y4vKe from PacerMonitor.com at no charge.
Counsel for the Debtors:
Gregg M. Galardi, Esq.
Cristine Pirro Schwarzman, Esq.
ROPES & GRAY LLP
1211 Avenue of the Americas
New York, New York 10036
Telephone: (212) 596-9000
- and -
M. Blake Cleary, Esq.
Edmon L. Morton, Esq.
Ryan M. Bartley, Esq.
Betsy L. Feldman, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square, 1000 North King Street
Wilmington, Delaware 19801
Telephone: (302) 571-6600
About Rubio's Restaurants
Rubio's Restaurants, Inc. and its affiliates are operators and
franchisors of 170 limited service restaurants in California,
Arizona, and Nevada under the Rubio's Coastal Grill concept. On
the Web: http://www.rubios.com/
Rubio's Restaurants, Inc., and its debtor affiliates filed
concurrently filed voluntary petitions for relief under Chapter 11
of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 20-12688) on
Oct. 26, 2020. The petitions were signed by Melissa Kibler, the
CRO. At the time of the filing, the Debtors estimated $50 million
to $100 million in assets and $100 million to $500 million in
liabilities.
Judge Mary F. Walrath oversees the cases.
The Debtors tapped Ropes & Gray LLP as counsel, Young Conaway
Stargatt & Taylor, LLP as Delaware counsel, Mackinac Partners LLC
as restructuring advisor, Gower Advisers as investment banker, and
B. Riley Financial, Inc., as real estate advisor. Stretto is the
claims, noticing, solicitation and balloting agent.
RUTABAGA CAFE: Feb. 24 Plan Confirmation Hearing Set
----------------------------------------------------
On Jan. 5, 2021, Debtor Rutabaga Cafe/Soiree Catering, LLC filed
with the U.S. Bankruptcy Court for the Northern District of
Florida, Panama City Division, a disclosure statement and plan. On
Jan. 7, 2021, Judge Karen K. Specie conditionally approved the
disclosure statement and established these dates and deadlines:
* Feb. 17, 2021, is fixed as the last day for filing and
serving written objections to the disclosure statement, and is
fixed as the last day for filing acceptances or rejections of the
plan.
* On or before Jan. 25, 2021, the plan of reorganization, the
disclosure statement, ballot for accepting or rejecting the plan,
and this Order conditionally approving the disclosure statement
shall be transmitted by mail by the attorney for the proponent of
the plan sought to be confirmed to creditors, equity security
holders and other parties in interest.
* Feb. 24, 2021, at 1:30 p.m. via Zoom Video Conference is the
confirmation hearing.
A full-text copy of the order entered Jan. 7, 2021, is available at
https://bit.ly/2LGn2NN
Attorneys for the Debtor:
Bruner Wright, P.A
Byron Wright III
Robert C. Bruner
2810 Remington Green Circle
Tallahassee, FL 32308
Office: (850) 385-0342
Fax: (850) 270-2441
E-mail: twright@brunerwright.com
rbruner@brunerwright.com
About Rutabaga Cafe/Soiree Catering
Rutabaga Cafe/Soiree Catering, LLC, a Chattahoochee, Fla.-based
restaurant company, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Fla. Case No. 20-40247) on June 10,
2020. At the time of the filing, the Debtor was estimated to have
assets of less than $50,000 and liabilities of between $100,000 and
$500,000. Judge Karen K. Specie oversees the case. The Debtor has
tapped Charles M. Wynn Law Offices, PA as its legal counsel.
RUTABAGA CAFE: Unsecured Creditors to Get 2% Dividend in Plan
-------------------------------------------------------------
Rutabaga Cafe/Soiree Catering, LLC, filed with the U.S. Bankruptcy
Court for the Northern District of Florida, Panama City Division, a
Chapter 11 Small Business Plan and a Disclosure Statement on Jan.
5, 2021.
The Debtor's primary reason for filing this case was due to
substantial tax debt. The Debtor needs to reorganize its business
affairs and pay off the tax debt.
The Debtor has experienced challenges due to the pandemic, but the
Debtor has increased its projected profitability by scheduling more
catering events and continue its restaurant operations.
The identity and fair market value of the estate's assets are
checking account, inventory, kitchen equipment, furniture, goodwill
with $11,620 approximate value.
Classes 2 to 5 consist of General Unsecured Claims.
Class 2 general unsecured creditors will be paid a 2 percent
dividend. The Class 3 claim of Christopher and Andrea Diamantis is
based on a judgment lien obtained in Leon County, Florida. Because
there is no collateral that secures the claim, it is fully
unsecured and will be paid a 2 percent dividend in the same manner
as Class 2.
The Class 4 claim of Retail First Insurance Company is based on a
judgment lien obtained in Gadsden County, Florida. Because there
is no collateral that secures the claim, it is fully unsecured and
will be paid a 2 percent dividend in the same manner as Class 2.
In addition, the Class 5 claim of US Foods, Inc., is based on a
judgment lien obtained in Gadsden County, Florida. Because there
is no collateral that secures the claim, it is fully unsecured and
will be paid a 2 percent dividend in the same manner as Class 2.
Equity interest holders Billy Ray Austin & Robert Derrell Gibson,
Jr., will waive distributions under the Plan as additional new
value consideration to retain their equity interests.
Payments and distributions under the Plan will be funded by the
income generated from the operation of Debtor's business.
A full-text copy of the Disclosure Statement dated Jan. 5, 2021, is
available at https://bit.ly/3biFSFC from PacerMonitor.com at no
charge.
Attorneys for the Debtor:
Bruner Wright, P.A
Byron Wright III
Robert C. Bruner
2810 Remington Green Circle
Tallahassee, FL 32308
Office: (850) 385-0342
Fax: (850) 270-2441
E-mail: twright@brunerwright.com
rbruner@brunerwright.com
About Rutabaga Cafe/Soiree Catering
Rutabaga Cafe/Soiree Catering, LLC, a Chattahoochee, Fla.-based
restaurant company, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Fla. Case No. 20-40247) on June 10,
2020. At the time of the filing, the Debtor was estimated to have
assets of less than $50,000 and liabilities of between $100,000 and
$500,000. Judge Karen K. Specie oversees the case. The Debtor has
tapped Charles M. Wynn Law Offices, PA, as its legal counsel.
SANUWAVE HEALTH: Stockholders OK 2 Proposals at Special Meeting
---------------------------------------------------------------
At a special meeting of stockholders of Sanuwave Health, Inc. held
on Dec. 30, 2020, the Company's stockholders:
(a) approved an amendment to the Company's Articles of
Incorporation to increase the number of authorized shares
of
the Company's Common Stock by 200 million Shares to 800
Million Shares; and
(b) authorized the Board of Directors to Amend the Company's
Articles of Incorporation to effect a reverse stock split of
the Company's Outstanding Common Stock at a Ratio of
1-for-50.
About SANUWAVE Health
Headquartered in Suwanee, Georgia, SANUWAVE Health, Inc.
(OTCQB:SNWV) -- http://www.SANUWAVE.com-- is a shockwave
technology company initially focused on the development and
commercialization of patented noninvasive, biological response
activating devices for the repair and regeneration of skin,
musculoskeletal tissue and vascular structures. SANUWAVE's
portfolio of regenerative medicine products and product candidates
activate biologic signaling and angiogenic responses, producing new
vascularization and microcirculatory improvement, which helps
restore the body's normal healing processes and regeneration.
SANUWAVE applies its patented PACE technology in wound healing,
orthopedic/spine, plastic/cosmetic and cardiac conditions. Its lead
product candidate for the global wound care market, dermaPACE, is
US FDA cleared for the treatment of Diabetic Foot Ulcers. The
device is also CE Marked throughout Europe and has device license
approval for the treatment of the skin and subcutaneous soft tissue
in Canada, South Korea, Australia and New Zealand. SANUWAVE
researches, designs, manufactures, markets and services its
products worldwide, and believes it has demonstrated that its
technology is safe and effective in stimulating healing in chronic
conditions of the foot (plantar fasciitis) and the elbow (lateral
epicondylitis) through its U.S. Class III PMA approved OssaTron
device, as well as stimulating bone and chronic tendonitis
regeneration in the musculoskeletal environment through the
utilization of its OssaTron, Evotron and orthoPACE devices in
Europe, Asia and Asia/Pacific. In addition, there are
license/partnership opportunities for SANUWAVE's shockwave
technology for non-medical uses, including energy, water, food and
industrial markets.
SANUWAVE reported a net loss of $10.43 million for the year ended
Dec. 31, 2019, compared to a net loss of $11.63 million for the
year ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had
$32.87 million in total assets, $33.74 million in total
liabilities, and a total stockholders' deficit of $873,002.
Marcum LLP, in New York, NY, the Company's auditor since 2018,
issued a "going concern" qualification in its report dated March
30, 2020 citing that the Company has a significant working capital
deficiency, has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
SENTINL INC: Court Confirms Plan After Parties Reach Deal
---------------------------------------------------------
Judge Mark A. Randon has entered an order confirming Sentinl Inc.'s
Plan as modified.
Before the judge confirmed the PLan, the Debtor, creditors JVIS
USA, LLC and Iltefat Hamzavi; Subchapter V Trustee; and United
States Trustee signed a stipulation providing for changes to the
Plan in order for the court to confirm a consensual Subchapter V
Plan.
Sentinl Inc. filed its Subchapter V Plan on Oct. 26, 2020. Copies
of the Plan and a ballot were served on all creditors, equity
security holders and other interested parties on Oct. 30, 2020.
The hearing on confirmation was held on Dec. 14, 2020. All filed
and unfiled objections have been resolved and those creditors
voting on the plan have accepted the Plan as amended by the
parties' stipulation.
The parties agreed that:
* The Debtor and creditor JVIS-USA, LLC, will on or before the
effective date enter into an agreement regarding terms of a control
account (the "Control Account") and open the Control Account at an
FDIC insured financial institution to hold proceeds from the
ordinary course sale of the Debtor's inventory where JVIS will be
entitled receive a direct transfer of $74.10 for each unit of
inventory sold plus net proceeds equal to its pro rata unsecured
claim from each unit sale after deducting the $74.10 and debtor's
cost of sale for sales taxes and shipping and handling.
* The Debtor and JVIS's agreement will stipulate that the Debtor
and JVIS are only entitled to direct transfer from the Control
Account after each inventory sale becomes final in accordance with
the Debtor's terms and conditions of ordinary course sales.
* In the event this case is converted to a Chapter 7, all
property of the Debtor and reorganized debtor will revest in the
estate.
* The Debtor will remain responsible for filing timely Monthly
Operating Reports until this case is confirmed, dismissed or
converted to Chapter 7.
* Nothing in the agreement will prevent the Debtor from
pre-purchasing any amount or type of inventory at $74.10 per
completed inventory unit or $2.50 per adapter viaa direct payment
to JVISprior to delivery. JVIS and Debtor will work together to
arrange for reasonably prompt delivery of inventory upon Debtor's
tender of pre-payment for inventory. The Debtor will use its best
efforts to sell the inventory in a prompt manner in accordance with
the Debtor's ordinary business judgment.
* Claim No. 4 filed by JVIS will be deemed an Allowed Claim for
all purposes under the Plan.
* Within 10 days of Plan Termination, the Debtor will distribute
any and all remaining funds, pro-rata to the General Unsecured
Creditors.
* The following terms of the Plan are hereby amended:
a. Article 3, Page 2 - general unsecured creditors will
receive approximately 3.7 cents on the dollar.
b. Appendix B, JVIS GUC Claim = $551,790.60.
c. Appendix E-4.A:
i. JVIS will receive approximately $20,427 for its
unsecured claim.
ii. VAST will receive approximately $5,687 for its
unsecured claim.
iii. Dr. Hamzavi will receive approximately $3,700 for his
unsecured claim.
iv. Adams Outdoor Advertising will receive approximately
$185.40 for its unsecured claim.
A copy of the Plan Confirmation Order dated Dec. 14, 2020, is
available at:
https://bit.ly/3bkCDh3
A copy of the Subchapter V Plan dated Oct. 26, 2020, is available
at:
https://bit.ly/3npNfxj
About Sentinl Inc.
Sentinl Inc. sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Mich. Case No. 20-48110) on July 7,
2020, listing under $1 million in both assets and liabilities. The
Debtor has tapped Maxwell Dunn, PLC, as its legal counsel and
Rabbaig and Haque, PLLC as its accountant.
SK HOLDCO: S&P Raises ICR to 'CCC+' on Close of Refinancing
-----------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on SK HoldCo LLC
(Service King) to 'CCC+' from 'CCC' and removed it from
CreditWatch, where S&P placed it with positive implications on Dec.
8, 2020. The outlook is negative.
At the same time, S&P is raising the issue-level rating on the
company's unsecured notes to 'CCC-' from 'CC' and removing it from
CreditWatch. The '6' recovery rating indicates its expectation for
negligible recovery (0%-10%; rounded estimate: 0%) in the event of
a default.
Service King's refinancing improves its maturity profile and
liquidity. The company refinanced its senior secured credit
facilities with a new $91 million revolver and $775 million term
loan B, extending the maturity of its revolver to 2024 and the
maturity of its term loan to 2025. Liquidity also increases
substantially with the revolver fully available and pro forma cash
of roughly $139 million, which includes $75 million reserved for
qualified purchases or redemptions of the company's notes due in
October 2022.
S&P said, "Consequently, we revised our liquidity assessment to
adequate from weak. We believe Service King would have sufficient
cushion under the new financial covenant. The company is now
subject to a $35 million monthly minimum liquidity (cash and
revolver availability) covenant, which will be tested on a
quarterly basis. We expect Service King to remain in compliance
over the next several quarters."
The negative outlook reflects both uncertainty in collision volumes
over the next 12 months and the risk Service King would engage in a
restructuring transaction that S&P would consider distressed.
COVID-19 cases are surging, and vehicle miles traveled likely fell
in the last month. It is also unclear when collision volumes will
return to more normal. Peak driving conditions remain less
congested since people continue to work from home. Furthermore,
Service King still has unsecured notes trading below par and due in
2022, so there is a risk of a distressed restructuring.
Although Service King has improved its operational efficiency since
2019, leverage will remain high. The company redesigned its front
office by streamlining employee roles and workflows, implementing
new production systems, and centralizing its support. As a result,
it reduced store overhead $44 million. Also, given the COVID-19
pandemic, Service King has adjusted its cost footprint and reduced
corporate overhead, cutting labor costs $10 million.
Service King is focused on integrating its production and back
office systems, deepening linkages with those of its insurance
carriers. Moreover, it is investing in tools and capabilities to
optimize utilization. Nevertheless, even looking past 2020 and the
adverse effects of the pandemic on performance, S&P expects debt to
EBITDA to remain high at about 10x in 2021.
The negative outlook reflects the risk Service King could engage in
a refinancing or restructuring transaction S&P would consider
distressed, whereby debtholders receive less than the original
promise. It also reflects the uncertainty of how quickly revenues
and margins will stabilize given the recent pandemic surge.
Downside scenario
S&P could lower the rating if:
-- S&P foresees an increased likelihood Service King engages in a
refinancing or restructuring transaction it considers distressed;
-- It fails to address the maturity of its notes by July 2021,
since the new first lien debt is subject to a springing maturity if
the notes have not been reduced below $135 million by July 1, 2022;
or
-- Liquidity contracts due to lower revenues and margins than
expected as a result of the pandemic.
Upside scenario
S&P could revise the outlook to stable if:
-- Service King increases margins sufficiently to at least break
even on free cash flow for a sustained period. This could occur if
cost savings from the new business approach can be maintained as
collision volumes recover; and
-- S&P views the risk of a partial debt restructuring as
significantly reduced.
SMARTOURS LLC: Unsec. Creditors to Recover 100% in Confirmed Plan
-----------------------------------------------------------------
Judge Karen B. Owens entered findings of facts, conclusions of law
and an order confirming smarTours, LLC's Modified Second Amended
Joint Chapter 11 PLan of Reorganization dated Dec. 14, 2020.
Only Holders of Claims in Class 1 (Term Loan Claims against
smarTours), Class 2 (Term Loan Claims against Holdings), Class 7
(Customer Priority Deposit Claims), Class 8 (Customer Unsecured
Deposit Claims) and Class 10 (General Unsecured Claims) were
entitled to vote on the Plan. All Voting Classes voted to accept
the Plan, and all Impaired Classes accepted the Plan.
The Plan is the culmination of significant arm's-length
negotiations with the Committee, the DIP Lenders, the Required
Lenders, the Equity Sponsor, the Debtors, and other constituencies
and is proposed with the honest purposes of substantially reducing
the Debtors' outstanding debt and expeditiously making the
distributions provided for in the Plan, and the release,
exculpation, compromise, settlement, and indemnification provisions
contained in the Plan are consistent with such purpose.
On Dec. 7, 2020, Trip Mate, Inc., filed a Limited Objection to
Smartours LLC's Notice of Assumption of Contract, which objected to
the Debtors' proposed cure amount in connection with the proposed
assumption of that certain trip insurance agreement between Trip
Mate, Inc. and smarTours, LLC (the "Trip Mate Agreement"). For the
avoidance of doubt, the Trip Mate Agreement is not being assumed
pursuant to this Order. A hearing on the assumption of the Trip
Mate Agreement is continued to a date to be determined. All of the
parties' rights with respect to the assumption or rejection of the
Trip Mate Agreement are reserved including, but not limited to, (i)
Trip Mate's right to file a proof of claim if the Trip Mate
Agreement is rejected, and (ii) the Debtors' right to reject the
Trip Mate Agreement and object to Trip Mate's claims. For the
avoidance of doubt, Trip Mate does not object to confirmation of
the Plan.
Modified Second Amended Plan
smarTours, LLC et al. submitted a Modified Second Amended Joint
Chapter 11 Plan of Reorganization on Dec. 14, 2020.
Class 1 Term Loan Claims against smarTours in the aggregate
principal amount of $23.8 million are impaired. On the Effective
Date, the $23.8 million aggregate principal amount outstanding
under the Term Loan shall be reduced to $16.0 million, with the
remaining outstanding principal balance of $7.8 million converted
to (i) 3.8 million New Class B Units in Reorganized Holdings and
(ii) 15,000 New Class A Units in Reorganized Holdings
(collectively, the "Lender Reorganized Holdings Equity Interests").
Each Holder of a Term Loan Claim against smarTours will receive
(i) its pro rata share of the Lender Reorganized Holdings Equity
Interests and (ii) reinstatement of such Term Loan Claim subject to
these modified terms: (a) the aggregate principal amount due under
the Term Loan will be $16.0 million, consisting of a $10.0 million
first out loan and a $6.0 million second out loan.
Class 2 Term Loan Claims against Holdings in the aggregate
principal amount of $23.8 million are impaired. On the Effective
Date, the $23.8 million aggregate principal amount outstanding
under the Term Loan will be reduced to $16.0 million, with the
remaining outstanding principal balance of $7.8 million converted
to the Lender Reorganized Holdings Equity Interests. Each Holder
of a Term Loan Claim against Holdings will receive (i) its pro rata
share of the Lender Reorganized Holdings Equity Interests and (ii)
reinstatement of such Term Loan Claim subject to the following
modified terms and conditions: (a) the aggregate principal amount
due under the Term Loan will be $16.0 million, consisting of a
$10.0 million first out loan and a $6.0 million second out loan.
Class 7 Customer Priority Deposit Claims are impaired. Each such
holder will receive a credit for any future trip offered by
Reorganized smarTours equal to the amount of its Allowed Customer
Priority Deposit Claim.
Class 8 Customer Unsecured Deposit Claims are impaired. Each such
holder will receive a Customer Credit equal to the amount of its
Allowed Customer Unsecured Deposit Claim.
Class 10 General Unsecured Claims are impaired. Each such holder
will receive, at the sole option of the Debtors with the consent of
the Required Lenders and the Equity Sponsor either:
(i) payment of 50 percent of the Allowed Unsecured Claims on
the Effective Date and 50 percent of the Allowed Unsecured Claims
on the six-month anniversary of the Effective Date; or
(ii) other treatment which renders such Claim Unimpaired
pursuant to Section 1124 of the Bankruptcy Code.
All Interests in Holdings in Class 13 will be deemed cancelled,
released, and extinguished and shall be of no further force and
effect, whether surrendered for cancellation or otherwise, and
there will be no distributions to Holders of Interests in Holdings
on account of any such interests.
The Debtors will fund distributions under the Plan, as applicable,
with: (a) the Debtors' cash on hand; (b) the up to $5 million
revolving Exit facility; and (c) $5.0 million investment by equity
sponsor Summit Park II, L.P., for new equity contributions.
A full-text copy of the Disclosure Statement dated Dec. 14, 2020,
is available at https://bit.ly/3ri1x6l from PacerMonitor.com at no
charge.
A full-text copy of the Plan Confirmation Order dated Dec. 15,
2020, is available at: https://bit.ly/38tQVKd
Co-Counsel to the Debtors:
Richard C. Pedone
NIXON PEABODY LLP
53 State Street
Boston, Massachusetts 02109
Telephone: (617) 345-1000
Facsimile: (617) 345-1300
E-mail: rpedone@nixonpeabody.com
- and -
Christopher M. Desiderio
Christopher J. Fong
55 West 46th Street
New York, NY 10036
Telephone: 212-940-3724
Facsimile: 855-900-8613
E-mail: cdesdierio@nixonpeabody.com
cfong@nixonpeabody.com
Christopher P. Simon
Kevin Mann
CROSS & SIMON, LLC
1105 North Market Street, Suite 901
Wilmington, Delaware 19801
Telephone: (302) 777-4200
Facsimile: (302) 777-4224
About smarTours LLC
SmarTours LLC is a travel company that offers tour packages with
airfare, hotels, and more included. Founded in 1996, smarTours is a
provider of direct-to-consumer, value-oriented travel experiences
to a variety of domestic and global destinations. It offers both
pre-packaged tours with pre-set departure dates for individual
travelers and customized private tours for passenger groups
consisting of more than 20 persons.
SmarTours, LLC and SPST Holdings, LLC sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 20-12625) on Oct. 19, 2020. The
petitions were signed by Christine Petersen, CEO. At the time of
the filing, smarTours estimated to have $1 million to $10 million
in assets and $10 million to $50 million in liabilities, while SPST
Holdings estimated to have less than $50,000 in assets and $10
million to $50 million in liabilities.
The Hon. Karen B. Owens is the case judge.
The Debtors tapped Nixon Peabody LLP as their bankruptcy counsel,
Cross & Simon, LLC as local Delaware counsel, and Ariste Advisors
LLC and Province, Inc., as financial advisors. Prime Clerk LLC is
the claims agent.
SMP ENTERPRISES: Has Until March 2 to File Plan & Disclosures
-------------------------------------------------------------
Judge Carlota M. Bohm of the U.S. Bankruptcy Court for the Western
District of Pennsylvania has ordered that the deadline for Debtor
SMP Enterprises, Ltd. for filing of the Reorganization and
Disclosure Statement is extended until March 2, 2021.
A full-text copy of the order entered Jan. 7, 2021, is available at
https://bit.ly/38wchqt
Counsel for the Debtor:
Jeffrey T. Morris, Esq.
Elliott & Davis, PC
425 First Avenue, First Floor
Pittsburgh, PA 15219
Tel: (412) 434.4911, ext. 34
Fax: (412) 774.2168
Email: morris@elliott-davis.com
About SMP Enterprises Ltd.
SMP Enterprises, Ltd. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case No. 20-22595) on Sept. 4,
2020. At the time of the filing, the Debtor estimated assets of
between $100,001 and $500,000 and liabilities of the same range.
Judge Carlota M. Bohm oversees the case. Jeffrey T. Morris, Esq.,
at Elliott & Davis, PC, serves as the Debtor's bankruptcy attorney.
STUDIO MOVIE: Files Plan After Shutting 15 of 33 Dine-In Theaters
-----------------------------------------------------------------
Studio Movie Grill Holdings, LLC and its debtor affiliates filed
with the U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, a Joint Plan of Reorganization and a Joint
Disclosure Statement on January 5, 2021.
The Debtors operated 33 dine-in movie theaters when they sought
bankruptcy protection. The Debtors have been engaged in
identifying which theaters are not profitable, which ones are
profitable, and which ones can be profitable; and renegotiating
leases with landlords. To date, the Debtors have filed motions to
reject 22 lease locations. As of the filing of this Disclosure
Statement, the Debtors have rejected 13 leases covering 15 theater
locations. The Debtors have and continue to negotiate with all
landlords. These negotiations have been largely successful, as the
Debtors have negotiated revised lease terms with many of their
landlords that incorporate some form of percentage rent to weather
the current depressed demand for theater experiences. At present,
18 theaters of the Debtors are open at a limited capacity due to
Covid-19 restrictions.
The Debtors have also dedicated substantial efforts evaluating
their options for a viable exit strategy. Those options include a
sale of the Debtors' business or a plan of reorganization. Based
on discussions their advisers, the DIP Lenders and their advisors,
and with the Committee and its advisors, the Debtors have
determined that a restructuring of their business through an equity
sale implemented through a chapter 11 plan is the best way to
maximize the value of the estates. To ensure that this is the
optimum option however, the Debtors have undertaken to market a
proposed sale of assets of the Debtors to potential buyers
(including the Prepetition Lenders) and obtained approval of the
Bidding Procedures to create a fair and orderly process to solicit
bids on either the stock in the Debtors or their assets, while
maintaining the flexibility to reorganize the Debtors.
The Plan provides for a reorganization of the Debtors as a going
concern, with a reduced number of theaters to focus on profitable
locations. The Debtors will fund distributions under the Plan
with, as applicable: cash on hand; future revenue; and an exit
facility.
Prepetition lenders owed $111.7 million in Class 2 will recover 3.4
percent. Prepetition lenders will receive (1) if an Equitization
Restructuring occurs, (a) its Pro Rata share of the New Units; plus
(b) its pro rata share of the Agent Trust Assets; plus (c) its Pro
Rata share of the Exit Facility allocable to the Prepetition
Lenders' Claims as determined by the Agent, and upon receipt
thereof, each such Holder shall become an Exit Facility Lender; or
(2) if an Asset Sale Restructuring occurs, (a) all cash of the
Debtors (including, if the Asset Sale Restructuring is to a Third
Party Purchaser, the Sale Proceeds) other than the GUC
Consideration and the Cash required to fund the Wind-Down Budget,
plus (b) its Pro Rata Share of the Agent Trust Assets.
Class 5 General unsecured creditors owed $65 million to 80 million
have an "unknown" estimated percentage recovery under the Plan,
according to the Disclosure Statement. If Class 5 votes as a Class
to accept the Plan, each holder of an Allowed GUC Claim in Class 5
will receive its pro rata share of the GUC Consideration. If Class
5 votes as a Class to reject the Plan, each such holder of an
Allowed GUC Claim in Class 5 will receive the value as such holders
are entitled to receive under Section 1129(a)(7) of the Bankruptcy
Code as determined by the Court at the Confirmation Hearing.
The GUC Consideration is based upon cash flows that have been
estimated by the Debtors, which are inherently subject to
significant variability based on factors related to COVID, the
Debtors' business operations, the quality of films released,
consumer preferences, and other factors.
Each Holder of GUC Claims in an aggregate Allowed amount greater
than $2,500 may irrevocably elect on its ballot to have such claim
irrevocably reduced to $2,500 and treated as a Convenience Class
Claim for the purposes of the Plan rather than as a GUC Claim.
Class 6 Convenience Claims (claims each not greater than $2,500)
will each receive within 30 days after the date such Claim is
Allowed payment in cash in an amount equal to 10% of the holder's
claim.
Class 9 Interests in SMG Holdings will be deemed canceled,
discharged, released, and extinguished, and there will be no
distribution to holders of interests in SMG Holdings on account of
those interests.
A full-text copy of the Joint Plan and Disclosure Statement dated
Jan. 5, 2021, is available at https://bit.ly/3hUwauf from
PacerMonitor.com at no charge.
Attorneys for the Debtors:
FRANK J. WRIGHT
JEFFERY M. VEVETO
JAY A. FERGUSON
Law Offices of Frank J. Wright, PLLC
2323 Ross Ave., Suite 730
Dallas, TX 75201
Telephone: (214) 935-9100
Email: frank@fjwright.law
jeff@fjwright.law
jay@fjwright.law
About Studio Movie Grill
Studio Movie Grill and its affiliates operated a chain of movie
theatres that include full-service dining during the show. Studio
Movie Grill is based in Dallas and ran 33 theater-restaurants.
On Oct. 23, 2020, Studio Movie Grill Holdings, LLC, and its
affiliates sought Chapter 11 protection (Bankr. N.D. Tex., Case No.
20-32633). Studio Movie Grill was estimated to have $50 million to
$100 million in assets and $100 million to $500 million in
liabilities.
The Hon. Stacey G. Jernigan is the case judge.
The Debtors tapped The Law Offices of Frank J. Wright, PLLC as
their legal counsel, Keen-Summit Capital Partners as real estate
advisor, Donlin, Recano & Company, Inc., as noticing, balloting and
administrative agent, and CR3 Partners, LLC as restructuring
advisor. William Snyder, a partner at CR3, was appointed as the
Debtors' chief restructuring officer.
The Office of the U.S. Trustee appointed a committee to represent
unsecured creditors in the Debtors' Chapter 11 cases on Nov. 16,
2020. The committee tapped Pachulski Stang Ziehl & Jones, LLP as
its lead counsel, Norton Rose Fulbright US LLP as local counsel,
and Dundon Advisers LLC as financial advisor.
TENTLOGIX INC: Seeks to Hire Carr Riggs as Accountant
-----------------------------------------------------
Tentlogix Inc. seeks approval from the U.S. Bankruptcy Court for
the Southern District of Florida to hire Carr Riggs & Ingram as its
accountant.
The Debtor needs the firm to provide accounting and tax services,
which include:
(a) preparing tax returns;
(b) compiling monthly balance sheets and income statements;
(c) preparing monthly reports required by the U.S. Trustee's
Office;
(d) assisting the Debtor in connection with its Chapter 11
reorganization; and
(e) other necessary accounting and tax services.
The fees for the firm's services will be based on the time spent by
staff members of the firm at their regular rates for similar
services.
Todd Laycock, a certified public accountant at Carr Riggs,
disclosed in court filings that his firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
Carr Riggs can be reached at:
Todd Laycock, CPA, EA
Carr Riggs & Ingram
33 SW Flagler Avenue
Stuart, FL 34994
Tel.: (772) 283-2356
Fax: (772) 287-1887
About Tentlogix Inc.
Tentlogix Inc. filed for Chapter 11 bankruptcy protection (Bankr.
S.D. Fla. Case No. 20-22971) on Nov. 27, 2020. Gary Hendry, chief
executive officer, signed the petition.
At the time of the filing, the Debtor disclosed $3,135,866 in
assets and $10,689,420 in liabilities.
Judge Mindy A. Mora oversees the case.
The Debtor tapped Kelley, Fulton & Kaplan, P.L. as its legal
counsel and Carr Riggs & Ingram as its accountant.
TIRED TEXAN: Seeks Approval to Hire Verdant as Accountant
---------------------------------------------------------
Tired Texan BBQ, LLC seeks authority from the U.S. Bankruptcy Court
for the District of Nebraska to hire Verdant, a Vista, Neb.-based
accounting firm.
The firm's services will include assisting the Debtor in completing
its monthly operating reports and preparing year end taxes for the
Debtor.
The firm will charge a flat rate of $800 per month for its
services.
Verdant has no connection with any of the Debtor's creditors or any
other "party in interest," according to court filings.
The firm can be reached through:
Brian Goracke,
Verdant
12110 Port Grace Blvd #100
Vista, NE 68128
Phone: +1 402-330-1200
About Tired Texan BBQ, LLC
Tired Texan BBQ, LLC sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. D. Neb. Case No. 20-81197) on Sept.
29, 2020, listing under $1 million in both assets and liabilities.
Judge Brian S. Kru oversees the case. Patrick Patino, Esq., at
Patino Law Office LLC, serves as the Debtor's counsel.
TMS INTERNATIONAL: S&P Assigns 'BB-' Rating to $150MM Term Loan B
-----------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue-level rating and '2'
recovery rating to U.S. steel mill services provider TMS
International Corp.’s $150 million term loan B due 2024. The '2'
recovery rating indicates its expectation for substantial recovery
(70%-90%; rounded estimate: 75%) in the event of a payment
default.
The company will apply the proceeds from term loan B toward its
acquisitions of competitor The Stein Cos. and an energy,
environmental, and material services provider based in Louisiana
for a total of $170 million.
S&P said, "We expect TMS' leverage to increase closer to 6x at
closing, from an estimated 4.6x earlier in 2020, which is still
below our 7x downgrade threshold. We anticipate the company's
leverage will fall back below 5x toward the end of 2021 if its
integration of the two companies proceeds smoothly and the recent
recovery in domestic steel demand and steel mill utilization rates
holds."
S&P's ratings on TMS International continue to reflect its close
correlation with the cyclical steel industry and the highly
competitive steel mill services market. These risks are partly
offset by its long-term contracts and variable cost structure.
TPT GLOBAL: Subsidiary Inks First SaaS Deal with MDamerica
----------------------------------------------------------
TPT Global Tech, Inc.'s subsidiary TPT MedTech executed its first
Software as a Service (SaaS) licensing agreement with MDamerica, a
New York based wellness, laboratory testing and medical supply
company. MDamerica operates several laboratory testing facilities
in New York and California and partners with numerous other
laboratories throughout the U.S. MDamerica provides COVID-19
testing as well as laboratory testing for some of the largest
companies in the entertainment and corporate sectors. The company
has a Preferred Vendor program offering medical devices and
supplies to over 20,000 laboratories, pharmacies and health care
facilities across the United States. MDamerica will be marketing
TPT MedTech "QuikLAB" and "QuikPASS" technology platforms as a
co-branding partner to its customers. MD America will pay TPT Med
Tech a monthly software licensing fee as well as a per test
transaction fee.
Once the software on-boarding and training activities are complete,
TPT MedTech and MDamerica have a target launch date of Jan. 10,
2021. For the initial launch MDamerica intends to on-board its
primary laboratories and pharmacy partners such as Esco Drug
Company in New York, Middle Port Health Center in Middle Port, NY.
Middle Village Pharmacy in Clifton NJ, Super Health Pharmacy of
Hopelawna in Perth Amboy NJ., Niagara Apothecary Inc. in Niagara
Falls NY, Wurlitzer Family Pharmacy in North Tonawanda NY and Rio
Grande Pharmacy in El Paso Texas.
TPT MedTech developed its "QuikPass" Check and Verify and
Vaccination monitoring platform for Corporations, Government
Organizations, Schools, Airlines, Hospitals, Sports Venues,
Restaurants, Hotels and Nightclubs to check and verify that an
individual has been tested for Covid 19 or Vaccinated providing
proof individuals are virus free and able to gain access to venues
with the idea that everyone inside that venue would be Covid free.
The "QuikPass" "Check and Verify" platform works with third party
testing labs and organizations that participate on the "QuikPass"
Network and will be offered FREE to US domestic and international
business commerce and government organizations around the world.
"We are very excited to be working with TPT MedTech to bring an
effective solution to our customers for reporting and tracking of
test results and vaccinations. We believe this technology will be
streamline this process and make it easier for patients, employers,
and travel providers to verify and validate COVID-19 test results
and vaccinations" said Jason Polete CEO of MDamerica.
"It is amazing how hard our development teams are working to bring
new innovative products to market to help fight against this
pandemic. We here at TPTW will continue to sort out those missing
pieces to the puzzle and develop new products that will help rid
our planet of the virus that has changed our lives," said Stephen
Thomas, CEO.
About TPT Global Tech
TPT Global Tech Inc. (OTC:TPTW) based in San Diego, California, is
a Technology/Telecommunications Media Content Hub for Domestic and
International syndication and also provides technology solutions to
businesses domestically and worldwide. TPT Global offers Software
as a Service (SaaS), Technology Platform as a Service (PAAS),
Cloud-based Unified Communication as a Service (UCaaS) and
carrier-grade performance and support for businesses over its
private IP MPLS fiber and wireless network in the United States.
TPT's cloud-based UCaaS services allow businesses of any size to
enjoy all the latest voice, data, media and collaboration features
in today's global technology markets. TPT's also operates as a
Master Distributor for Nationwide Mobile Virtual Network Operators
(MVNO) and Independent Sales Organization (ISO) as a Master
Distributor for Pre-Paid Cellphone services, Mobile phones
Cellphone Accessories and Global Roaming Cellphones.
TPT Global reported a net loss of $14.03 million for the year ended
Dec. 31, 2019, compared to a net loss of $5.38 million for the year
ended Dec. 31, 2018. As of Sept. 30, 2020, the Company had $15.96
million in total assets, $36.86 million in total liabilities, $4.79
million in total mezzanine equity, and a total stockholders'
deficit of $25.69 million.
Sadler, Gibb & Associates, LLC, in Salt Lake City, UT, the
Company's auditor since 2016, issued a "going concern"
qualification in its report dated April 14, 2020 citing that the
Company has suffered recurring losses from operations and has a net
capital deficiency which raise substantial doubt about its ability
to continue as a going concern.
TRATTORIA SAN DOMENICO: Restaurant Closes, Files for Chapter 7
--------------------------------------------------------------
Laura Smythe of the Philadelphia Business Journal reports that a
family-run Italian restaurant in Newtown Square in Pennsylvania has
filed for Chapter 7 bankruptcy as the Covid-19 pandemic brings the
eatery's 15-year run to a close.
Trattoria Giuseppe, located at 4799 West Chester Pike, was a fan
favorite in Greater Philadelphia known for authentic fare including
pizzas, pastas, salads and appetizers like calamari and bruschetta.
The business is owned by Giuseppe Musso, a chef who has worked in
kitchens in Sicily, Italy, and Switzerland. He operated the
concept alongside his wife, son and daughter.
The suburban restaurant additionally operated a robust banquet
facility at its Newtown Square location dubbed Bella di Notte,
which could accommodate up to about 200 people prior to the
pandemic, said Allen Dubroff, the lawyer representing the
bankruptcy filing.
Given the Chapter 7 filing, there is no going forward for the
restaurant, Dubroff said, and "there's no doubt that the pandemic
put the final touch on an industry that it's hard to make a living
in." Trattoria Giuseppe was able to hold a few banquets in March
2020, but that arm of the business has been at a standstill ever
since. The banquet facility was a large component of the
restaurant's lease, Mr. Dubroff said.
That blow to business coupled with the "great cost" it would take
to build out the restaurant's outdoor dining space for cold winter
weather were the final straws.
"It's just a calamity and a business that's being harmed in this
world by the pandemic," Mr. Dubroff said. "It's absolutely a
casualty of this."
Trattoria Giuseppe served a limited number of people on
Thanksgiving and was open for takeout. It then closed over the
holiday weekend, according to Dubroff.
The eatery received between $150,000 and $350,000 in federal
Paycheck Protection Program loans earlier this year, according to
federal data. A second round of PPP might have helped the
restaurant survive, Mr. Dubroff said, because Trattoria Giuseppe
never laid off any of its 26 employees, instead paying the whole
team "until it exhausted all their means."
"I give that husband-and-wife team a lot of credit," Mr. Dubroff
noted. "They kept paying everybody and it killed them."
Trattoria Giuseppe announced its closure via Facebook on Monday,
and hundreds of people lamented the shuttering in the comments.
"You were truly a huge part of this community!" one person wrote.
"I've shared so many special occasions at Giuseppe's and many
family dinners. I'm devastated to hear this news."
"This is breaking my heart. I am crying," another added. "You
were the one place we could ALWAYS count on for the most delicious
meals and fantastic atmosphere! We will miss you SO MUCH!"
Mr. Dubroff anticipates many more "hospitality downfalls" in the
coming months.
"It still makes my stomach gurgle and I still feel upset because
you sometimes represent clients that ruined their own business, but
this isn’t the case," he said. "This is something none of us
could have predicted."
About Trattoria Giuseppe Restaurant
Trattoria Giuseppe Restaurant is family-run Italian restaurant in
Newtown Square, Philadelphia that is famous for authentic fare
including pizzas, pastas, salads and appetizers like calamari and
bruschetta. The business is owned by Giuseppe Musso, a chef who
has worked in kitchens in Sicily, Italy, and Switzerland. He
operated the concept alongside his wife, son and daughter.
The corporate entity, Trattoria San Domenico, doing business as
Restaurant Guisseppe, filed a Chapter 7 petition (Bankr. E.D.N.Y.
Case No. 20-14582) on Nov. 30, 2020. The Debtor was estimated to
have debt between $500,001 and $1 million, while assets fall
between $100,001 and $500,000.
The Debtor's Attorney:
ALLEN B. DUBROFF
Tel: 215-568-2700
E-mail: allen@dubrofflawllc.com
The Chapter 7 Trustee:
TERRY P. DERSHAW
Dershaw Law Offices P.O. Box 556
Warminster, PA 18974
The Trustee tapped Gellert Scali Busenkell & Brown LLC as general
counsel.
TWO WHEELS PROPERTIES: Court To Dismiss Ch. 11 Case
---------------------------------------------------
Judge Eduardo V. Rodriguez of the United States Bankruptcy Court
for the Southern District of Texas will dismiss Two Wheels
Properties, LLC's chapter 11, subchapter V case.
Two Wheels Properties, LLC was dissolved by forfeiture of its
charter by the Texas Secretary of the State on February 2, 2018.
On November 2, 2020, Two Wheels Properties filed its initial
petition under chapter 11, subchapter V of title 11 of the Code.
On December 8, 2020, during the initial status conference the
Court, sua sponte, questioned the Debtor's standing to file a
chapter 11 proceeding given forfeiture of its Texas corporate
charter.
Two Wheels Properties alleged that two courts have opined whether
debtors are able to seek bankruptcy relief in the name of the
forfeited corporation: the court in In re ABZ Insurance Services
and the court in In re American Heartland Sagebrush Secs. Invs.,
Inc. It further alleged that "the ABZ Court held that a forfeited
corporation under the Texas Tax Code was eligible for bankruptcy
relief within three years of dissolution because the Code provided
that dissolved corporations continue their existence for three
years following dissolution for limited purposes of liquidation and
distribution of assets. The American Heartland Court held that a
corporation that was forfeited under the Texas Tax Code more than
ten years earlier could not file chapter 7 bankruptcy because its
existence as a dissolved corporation for purposes of winding down
its operations continued for only three years following its
dissolution." Based on those cases, Two Wheels Properties
concluded that it is properly a debtor in the case because three
years have not lapsed since its forfeiture.
Judge Rodriguez said that "the court in In re ABZ Insurance
Services, the only case favorably cited by Debtor, considered an
entity's ability to file a chapter 7 bankruptcy petition. As
pointed out by the United States Trustee in its responsive brief,
distinguishing between chapter 7 and chapter 11, subchapter V
relief is important because of the provisions of sections 11.053,
11.356, and 11.201 of the Texas Business Organizations Code. As
correctly recited in Debtor's brief, by statute, forfeited entities
retain limited survivability after termination. However, an
entity's limited survivability persists for the entity to wind up,
for which there exists a statutory procedure that includes ending
the business and liquidating the business's property to discharge
all of the entity's liabilities and obligations." Judge Rodriguez
added that "Debtor cannot reinstate its corporate charter under
sections 11.2011 and 11.356(b) of the Texas Business Organizations
Code because '[a] terminated filing entity may not continue its
existence for the purpose of continuing the business or affairs for
which the terminated filing entity was formed unless the terminated
filing entity is reinstated under Subchapter E.' And '[a]
terminated entity may not be reinstated under this section if the
termination occurred as a result of . . . forfeiture under the Tax
Code.' Debtor's corporate charter was forfeited for failing to
report and pay franchise taxes. Thus, its termination occurred as
a result of forfeiture under the Texas Tax Code and Debtor cannot
continue the business or affairs for which it originally formed and
it cannot reinstate its charter. Debtor may only wind up and apply
its property to its liabilities and obligations."
Judge Rodriguez explained that "an entity that forfeits its
corporate charter is permitted to prosecute a chapter 7 bankruptcy
case within 3 years of such forfeiture because it is liquidating
its assets to satisfy its liabilities and obligations. Here, Two
Wheels Properties, LLC cannot properly be a debtor under chapter
11, subchapter V, to the extent it seeks to continue its business
or affairs through the pendency of this case and post-confirmation
of any plan of reorganization. Thus, this case will be
dismissed."
The case is IN RE: TWO WHEELS PROPERTIES, LLC, Chapter 11, Debtor,
Case No. 20-35372, (Bankr. S.D. Tex.). A full-text copy of the
Memorandum Opinion, dated December 30, 2020 is available at
https://tinyurl.com/y4cekz2u from Leagle.com.
About Two Wheels Properties, LLC
Two Wheels Properties, LLC filed an emergency voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Tex. Case No. 20-35372) on Nov. 2, 2020. At the time of filing, the
Debtor estimated $500,001 to $1 million in both assets and
liabilities. Judge Eduardo V. Rodriguez oversees the case. Alex
Olmedo Acosta at Acosta Law, P.C. serves as the Debtor's counsel.
TWO WHEELS PROPERTIES: Gets OK to Hire Accountant
-------------------------------------------------
Two Wheels Properties, LLC received approval from the U.S.
Bankruptcy Court for the Southern District of Texas to hire John
Bell, an accountant practicing in Cypress, Texas.
The Debtor requires the services of an accountant to prepare
documents to reinstate the corporate chapter with the Secretary of
State of Texas.
Mr. Bell has agreed to provide bookkeeping and monthly operating
report preparation services at a flat rate of $150 per hour and to
prepare tax returns at the flat rate of $400 per return.
Mr. Bell, and its members and associates, are disinterested persons
within the meaning of Section 101(14) of the Bankruptcy Code,
according to court filings.
The accountant can be reached at:
John T. Bell
26906 Autumn Timbers Lane
Cypress, TX 77433
Phone: (713) 826-4007
Fax: (832) 201-7640
About Two Wheels Properties LLC
Two Wheels Properties, LLC filed an emergency voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Tex. Case No. 20-35372) on Nov. 2, 2020. At the time of the
filing, the Debtor estimated $500,001 to $1 million in both assets
and liabilities. Judge Eduardo V. Rodriguez oversees the case.
Alex Olmedo Acosta at Acosta Law, P.C. serves as the Debtor's
counsel.
UTZ QUALITY: S&P Rates $720MM Term Loan 'B'
-------------------------------------------
S&P Global Ratings assigned its 'B' issue-level rating on Utz
Quality Foods LLC's (operating subsidiary of parent company, Utz
Brands Inc.) proposed $720 million term loan B due in seven years.
The recovery rating is '3', indicating its expectations for
meaningful recovery (50%-70%; rounded estimate: 60%) in the event
of a payment default. Concurrent with this transaction, the company
is upsizing its asset-based lending (ABL) revolving credit facility
to $160 million from $116 billion. The lowered recovery ratings on
the new term loan from the prior facility reflects the increase in
priority debt from the larger ABL and increase in the senior
secured debt, which weakens its recovery prospects. S&P will
withdraw the ratings on the existing first lien term loan after the
deal closes.
Utz will use the proceeds from the new term loan along with about
$181 million cash proceeds from redemption of its outstanding
public warrants to refinance the company's existing $410 million
(outstanding) term loan B due Nov. 2024 and to repay the $490
million bridge financing used to fund the December 2020 acquisition
of Truco Enterprises, which sells tortilla chips, salsa, and queso
under the ON THE BORDER brand.
S&P said, "Our issuer credit rating on Utz Brands Inc. remains 'B'.
Pro forma for the acquisition and the proposed debt issuance, we
estimate its leverage will increase modestly to nearly 5x from
about 4.7x as of the 12 months ended Sept. 27, 2020. Truco will add
about $200 million of revenues and $50 million in EBITDA. The
acquisition will strengthen the company's market position in salty
snacks, add scale in fast growing tortilla chips, and expand its
channel and geographic presence. It will also provide Utz entry
into the adjacent salsa and queso categories. Given its asset-light
model, Truco will be accretive and will improve the overall
company's margins and cash flow profile. We also expect little
integration risk given the asset-light model and low cost synergy
estimate of $5 million."
"If the final terms and conditions materially differ from what was
presented to us, we could reassess our ratings."
Issue Ratings—Recovery Analysis
Following this transaction, the company's debt structure will
comprise:
-- A $160 million ABL facility due 2024 (not rated); and
-- A $720 million term loan B due in seven years
Key analytical factors
-- Utz Quality Foods LLC is the borrower of the revolver and
first-lien term loan. The term loan receives guarantees from all of
the company's existing and future direct and indirect domestic
restricted subsidiaries.
-- The ABL is secured on a first-priority basis by accounts
receivable, inventory, and the proceeds thereof, as well as a
junior lien on the term loan collateral (excluding real estate).
The first-lien term loan is secured by a first lien on all non-ABL
priority collateral (excluding real estate) and a second lien on
the ABL borrowing base collateral of Utz and all of the
guarantors.
-- Utz is headquartered in Pennsylvania and substantially all of
its assets and operations are in the U.S. In an insolvency
proceeding, S&P expects the company to file for bankruptcy
protection in the U.S. under the federal bankruptcy court system.
Simulated default assumptions
-- S&P raised its enterprise valuation to reflect the EBITDA
contribution of Truco and the company's higher interest expense.
-- S&P's simulated default scenario assumes a payment default
occurring in 2023 because of lower revenue, reflecting increased
competition, a product recall, or a quality issue that erodes its
brand equity and sparks a major deterioration in its operating
performance. Because of this, the company would need to fund its
cash flow shortfalls with available cash and revolver borrowings.
-- Eventually, its liquidity and capital resources would
deteriorate to the point that it could not cover its fixed
charges.
-- Due to the company's well-known brands and solid distribution
network, S&P believe the company would reorganize following a
bankruptcy. S&P values the company based on the emergence EBITDA
multiple approach and apply a multiple of 6.0x to estimate a gross
recovery value of $577 million. S&P's valuation assumes the company
emerges from bankruptcy, regains some lost sales, and cuts costs to
restore some of its EBITDA.
Calculation of EBITDA at emergence:
-- Debt service: $54 million (default year interest plus
amortization)
-- Capex: $15 million
-- Default EBITDA proxy: $69 million
-- Operational adjustment: $28 million (40%)
-- Emergence EBITDA: $96 million
Simplified waterfall
-- Emergence EBITDA: $96 million
-- Multiple: 6x
-- Gross recovery value: $577 million
-- Net recovery value for waterfall after administrative expenses
(5%): $549 million
-- Priority claims: $98 million
-- Obligor/nonobligor valuation split: 100%/0%
-- Collateral value available to first-lien debt: $450 million
-- Estimated first-lien claims: $727 million
-- Recovery expectations for first-lien debt: 50%-70% (rounded
estimate: 60%)
VALARIS PLC: Denounces Lenders Efforts to Submit Rival Plan
-----------------------------------------------------------
Maria Chutchian of Reuters reports that Valaris PLC has defended
its request to maintain control of its bankruptcy proceeding
against opposition from certain lenders, who the company says are
trying to secure a larger payout than it is owed.
In court papers filed on Thursday, January 7, 2021, Valaris,
represented by Kirkland & Ellis, urged U.S. Bankruptcy Judge Marvin
Isgur to reject the lenders' contention that the London-based
driller has strong-armed creditors into backing its restructuring
proposal. The dispute arises as Valaris requests an additional four
months of its exclusive period to file a Chapter 11 plan without
the threat of creditors making competing proposals, which Isgur
will consider during a virtual hearing on Jan. 11, 2021.
About Valaris PLC
Valaris plc (NYSE: VAL) provides offshore drilling services. It is
an English limited company with its corporate headquarters located
at 110 Cannon St., London. On the Web: http://www.valaris.com/
On Aug. 19, 2020, Valaris and its affiliates sought Chapter 11
protection (Bankr. S.D. Tex. Lead Case No. 20-34114). The Debtors
had total assets of $13,038,900,000 and total liabilities of
$7,853,500,000 as of June 30, 2020.
The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as
their bankruptcy counsel, Lazard as investment banker, and Alvarez
& Marsal North America LLC as their restructuring advisor. Stretto
is the claims agent, maintaining the page
http://cases.stretto.com/Valaris
Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer &
Feld LLP serve as legal advisors to the consenting noteholders
while Houlihan Lokey Inc. serves as their financial advisor.
VIDEOMINING CORP: Seeks to Hire ICAP as Patent Broker
-----------------------------------------------------
Videomining Corporation seeks authority from the U.S. Bankruptcy
Court for the Western District of Pennsylvania to employ ICAP
Patent Brokerage LLC to market its patents through Feb. 28.
ICAP will receive a one-time payment of $10,000, plus a commission
on the sale of the Debtor's intellectual property portfolio as
follows:
a. 20 percent for any sales price up to $1,000,000;
b. 15 percent if the sales price is between $1,000,001 and
3,000,000;
c. 12 percent if the sales price is between $3,000,0001 and
$5,000,000; and
d. 10 percent if the sales price is greater than $5,000,000.
Neither ICAP nor the professionals at the firm who will be
performing the services have any connection with the Debtor,
creditors or any other "party in interest," according to court
filings.
ICAP can be reached through:
J. Douglas Rhoten
ICAP Patent Brokerage, LLC
173 Huguenot St., Suite 200
Rochelle, NY 10801
Tel: 408-809-1772
Fax: 646-786-3322
About Videomining Corporation
VideoMining Corporation -- http://www.videomining.com/-- is an
in-store behavior analytics for Consumer Packaged Goods (CPG)
manufacturers and retailers. VideoMining's analytics platform
utilizes a patented suite of sensing technologies to capture
in-depth shopper behavior data. These previously unmeasured
insights are then integrated with multiple other data sources such
as transactions, planograms, product mapping, loyalty and
promotions to fuel comprehensive solutions for optimizing shopper
experience and sales performance.
VideoMining Corporation filed a Chapter 11 petition (Bankr. W.D.
Pa. Case No. 20-20425) on Feb. 4, 2020. In the petition signed by
Rajeev Sharma, chief executive officer, the Debtor was estimated to
have between $10 million and $50 million in assets and between $1
million and $10 million in liabilities.
Judge Gregory L. Taddonio oversees the case.
Robert O Lampl Law Office and Onmyodo, LLC serve as the Debtor's
legal counsel and financial consultant, respectively.
WESTINGHOUSE ELECTRIC: Court Rejects Workers' WARN Suit vs. SCANA
-----------------------------------------------------------------
Law360 reports that a South Carolina judge has ruled that the
utility behind the nuclear project that helped bankrupt
Westinghouse Electric is not liable for failing to give workers
sufficient warning before the plant's abrupt shutdown. U.S.
District Court Judge J. Michelle Childs rejected the workers'
arguments that SCANA Corp. and Westinghouse were effectively acting
as a single employer and were both responsible for warning workers
before the Virgil C. Summer Nuclear Generating Station was canceled
in 2017 and issued a summary judgement dismissing claims against
the utility. SCANA, owner of utility South Carolina Electric & Gas
Co. , contracted Westinghouse to build two nuclear plants.
About Westinghouse Electric
Westinghouse Electric Company LLC --
http://www.westinghousenuclear.com/-- is a U.S.-based nuclear
power company founded in 1999 that provides design work and
start-up help for new nuclear power plants and makes many of the
components. Westinghouse manufactures and supplies the commercial
fuel products needed to run the plants, and it offers training,
engineering, maintenance, and quality management services. Almost
50% of nuclear power plants around the world and about 60% of U.S.
plants are based on Westinghouse's technology. Westinghouse's
world headquarters are located in the Pittsburgh suburb of
Cranberry Township, Pennsylvania.
On Oct. 16, 2006, Westinghouse Electric was sold for $5.4 billion
to a group comprising of Toshiba (77% share), partners The Shaw
Group (20% share), and Ishikawajima-Harima Heavy Industries Co.
Ltd. (3% share). After purchasing part of Shaw's stake in 2013,
Japan-based conglomerate Toshiba obtained ownership of 87% of
Westinghouse.
Amid cost overruns at U.S. nuclear reactors it was building,
Westinghouse Electric Company LLC, along with 29 affiliates, filed
voluntary petitions for relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 17-10751) on March 29,
2017. The petitions were signed by AlixPartners' Lisa J. Donahue,
the Debtors' chief transition and development officer.
The Debtors disclosed total assets of $4.32 billion and total
liabilities of $9.39 billion as of Feb. 28, 2017.
The Hon. Michael E. Wiles presides over the cases.
Weil, Gotshal & Manges LLP serves as counsel to the Debtors. The
Debtors hired AlixPartners LLP as financial advisor; PJT Partners
Inc. as investment banker; Kurtzman Carson Consultants LLC as
claims and noticing agent; K&L Gates as special counsel; and KPMG
LLP as tax consultant and accounting and financial reporting
advisor.
The Debtors retained PricewaterhouseCoopers LLP as independent
auditor and tax services provider to perform audit services in
connection with Toshiba Nuclear Energy Holdings (US) Inc. and
Toshiba Nuclear Energy Holdings (UK) Ltd.
Toshiba Nuclear Energy Holdings (UK) Ltd. is represented by Albert
Togut, Esq., Brian F. Moore, Esq., and Kyle J. Ortiz, Esq., at
Togut, Segal & Segal LLP.
The Board of Directors of Westinghouse appointed a special panel
called the U.S. AP1000 Committee to oversee the company's
activities related to certain AP1000 nuclear plants located in
Georgia and South Carolina.
On April 7, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. Proskauer Rose LLP is
the committee's bankruptcy counsel, and Houlihan Lokey Capital,
Inc., serves as its investment banker.
WOODBRIDGE GROUP: Trust Announces $50M Distribution
---------------------------------------------------
Woodbridge Liquidation Trust announced Jan. 7, 2021, that its
Liquidation Trustee, with the approval of the Trust's Supervisory
Board, has declared an aggregate cash distribution of $50,000,000
on the Trust's Class A Liquidation Trust Interests (the "Class A
Interests"). This amount includes a reserve of approximately
$717,000 for the issuance of additional Class A Interests based on
estimated bankruptcy claims subject to future allowance pursuant to
the First Amended Joint Chapter 11 Plan of Liquidation dated August
22, 2018 of Woodbridge Group of Companies, LLC and its Affiliated
Debtors (the "Plan").
The distribution amounts to $4.28 per Class A Interest, and will be
paid on or about January 27, 2021 to holders of record of Class A
Interests as of close of business on Monday, January 18, 2021.
Regarding the distribution, the Trust's Liquidation Trustee Michael
Goldberg said, "I am pleased to be able to announce this additional
interim distribution to our holders. We continue to anticipate
making additional distributions in the future from time to time."
About Woodbridge Group
Headquartered in Sherman Oaks, California, The Woodbridge Group
Enterprise -- http://www.woodbridgecompanies.com/-- was a
comprehensive real estate finance and development company. Its
principal business was buying, improving, and selling high-end
luxury homes. The Woodbridge Group Enterprise also owned and
operated full-service real estate brokerages, a private investment
company, and real estate lending operations.
Woodbridge filed for bankruptcy as a result of a massive,
multi-year Ponzi scheme perpetrated by Robert Shapiro between (at
least) 2012 and 2017. As part of this fraud, Shapiro, through the
Woodbridge entities, raised over one billion dollars from
approximately 10,000 investors -- as either noteholders or
unitholders.
Woodbridge Group of Companies and certain of its affiliates filed
Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case No.
17-12560) on Dec. 4, 2017. Woodbridge estimated assets and
liabilities at between $500 million and $1 billion. The Chapter 11
cases are being jointly administered. Judge Kevin J. Carey
presided over the case.
Gibson, Dunn & Crutcher, LLP, and Young Conaway Stargatt & Taylor,
LLP, served as the Debtors' bankruptcy counsel. Homer Bonner
Jacobs, PA, served as special counsel; Province, Inc., as expert
consultant; and Moelis & Company LLC, as investment banker.
The Debtors' financial advisors were Larry Perkins, John Farrace,
Robert Shenfeld, Reece Fulgham, Miles Staglik, and Lissa Weissman
at SierraConstellation Partners, LLC. Beilinson Advisory Group
served as independent management to the Debtors. Garden City
Group, LLC, served as the Debtors' claims and noticing agent.
An official committee of unsecured creditors was appointed in the
Chapter 11 cases. Pachulski Stang Ziehl & Jones served as counsel
to the Official Committee of Unsecured Creditors; and FTI
Consulting, Inc., acted as its financial advisor.
On Jan. 23, 2018, the Court approved a settlement providing for the
formation of an ad hoc noteholder group and an ad hoc unitholder
group.
Woodbridge Group won confirmation of its plan of liquidation in
October 2018.
About Woodbridge Liquidation Trust
Woodbridge Liquidation Trust is a Delaware statutory trust that,
together with its wholly-owned subsidiary Woodbridge Wind-Down
Entity LLC, was formed on Feb. 15, 2019 to implement the terms of
the First Amended Joint Chapter 11 Plan of Liquidation dated August
22, 2018 of Woodbridge Group of Companies, LLC, and Its Affiliated
Debtors (the "Plan"). The purpose of the Trust is to prosecute
various causes of action acquired by the Trust pursuant to the
Plan, to litigate and resolve claims filed against the debtors
under the Plan, to pay allowed administrative and priority claims
against the debtors (including professional fees), to receive cash
from certain sources and, in accordance with the Plan, to make
distributions of cash to holders of interests in the Trust subject
to the retention of various reserves and after the payment of Trust
expenses and administrative and priority claims. On the Web: visit
http://www.woodbridgeliquidationtrust.com/
YODEL TECHNOLOGIES: Judge Enters Plan Confirmation Order
--------------------------------------------------------
Judge Michael G. Williamson has entered an order approving the
Disclosure Statement and confirming the Amended Plan of
Reorganization of Yodel Technologies, LLC.
The parties informed the Court that the parties had reached various
agreements to resolve their disputes regarding confirmation issues
during the Dec. 16, 2020 hearing.
The Debtor and Uber have come to an agreement whereby the Class 3
unsecured creditors pool will be increased to a $250,000 plan pool
with allowed claims in this class to receive a pro-rata
distribution in 36 months with payments commencing in 60 days
following the effective date of confirmation to be paid quarterly;
in addition, the Debtor's objection to Uber's claim is resolved
such that Uber's claim shall be allowed as a general unsecured
claim in the amount of $10 million.
Class 4 Equity Security Holders and Insider claims will receive no
distribution until Class 2 and Class 3 Creditors have been paid in
full.
The Plan was proposed with the honest and legitimate purpose of
maximizing the value of the Debtor's estate and the payments to
creditors. The Plan was developed in good faith on the part of the
Debtor and in good faith negotiations with various creditors.
Therefore, 11 U.S.C. Sec. 1129(a)(3) is met.
A status conference will be held in, Courtroom 8A, Sam M. Gibbons
United States Courthouse, 801 N. Florida Ave., Tampa, FL 33602 on
Feb. 24, 2021, at 9:30 a.m., before the Honorable Michael G.
Williamson, United States Bankruptcy Judge.
A full-text copy of the Plan Confirmation Order entered Jan. 7,
2021, is available at ttps://bit.ly/2MPEVdQ
Attorney for the Debtor:
Buddy D. Ford, Esquire
Jonathan A. Semach, Esquire
Heather M. Reel, Esquire
BUDDY D. FORD, P.A.
9301 West Hillsborough Avenue
Tampa, Florida 33615-3008
Telephone: (813) 877-4669
Facsimile: (813) 877-5543
Office E-mail: All@tampaesq.com
E-mail: Buddy@tampaesq.com
Jonathan@tampaesq.com
Heather@tampaesq.com
About Yodel Technologies
Yodel Technologies, LLC -- https://www.yodelvoice.com/ -- is a
Florida-based telemarketing company that develops and uses
soundboard technology in combination with live agents to enhance
interactions with prospective clients or customers.
Yodel Technologies filed a Chapter 11 petition (Bankr. M.D. Fla.
Case No. 20-00540) on Jan. 23, 2020. In the petition signed by
Robert Pulsipher, managing member and chief operating officer,
Debtor disclosed $3,126,219 in assets and $6,027,981 in
liabilities. Judge Michael G. Williamson oversees the case.
The Debtor tapped Buddy D. Ford, P.A. as bankruptcy counsel;
Weinberg Partners, Ltd. as accountant; and Triumvir Management, LLC
as property manager.
ZUAITER COMPANY: Seeks Approval to Hire Bankruptcy Attorney
-----------------------------------------------------------
Zuaiter Company, Inc. seeks authority from the U.S. Bankruptcy
Court for the Northern District of Alabama to hire Steven Mitchell
Howie, Esq., an attorney practicing in Hunstville, Ala., to handle
its Chapter 11 case.
The attorney will charge an hourly fee of $300 for his services.
He expects to receive a retainer in the amount of $10,000.
Mr. Howie disclosed in court filings that he is a "disinterested
person" as defined under the Bankruptcy Code.
Mr. Howie can be reached at:
S. Mitchell Howie, Esq.
100 Jefferson Street, Suite 200
Hunstville, AL 35801
Phone: (256) 533-2400
Fax: (256) 533-3488
Email: mitchhowielaw@gmail.com
About Zuaiter Company Inc.
Zuaiter Company, Inc. sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. N.D. Ala. Case No. 20-82554) on Dec.
10, 2020, listing under $1 million in both assets and liabilities.
Judge Clifton R. Jessup, Jr. oversees the case. S. Mitchell Howie,
Esq., serves as the Debtor's legal counsel.
[*] 15 Businesses That Shut in Columbus, Ohio in 2020
-----------------------------------------------------
Cynthia Rosi of NBC4i reports that 2020 was a hard year for
businesses in Columbus as there were 25 closures, bankruptcies, and
struggling businesses.
Small business owners struggled to make ends meet throughout in
2020. Brides canceled their weddings, restaurants and bars were hit
by shut-down orders and curfews, and retail stores saw business
shift from in-person to online sales.
Here are 15 businesses that will be missed, and 10 more on the edge
-- although some, like Dock 580 and the AMC Lennox, have already
found new owners and new names.
* La Scala Italian Bistro, Dublin
This summer of 2020, longtime owner and chef at LaScala, Willi
Lalli, died after contracting COVID-19. His son, Nick Lalli, who
worked alongside his father as co-owner, took the sad and painful
decision to close, after doing everything he could to remain open.
* Noah's Event Venue, New Albany
NOAH filed for Chapter 11 reorganization bankruptcy in May of 2019,
but in February 2020, a judge and a U.S. Bankruptcy trustee
overseeing the case changed it to a Chapter 7 liquidation, Court
files state the venue couldn't accept any more payments or book
additional gigs after their filing. However, it was unlikely that
customers would receive a refund from NOAH.
* Dock 580
The wedding venue announced in June 2020 that it would close its
doors, and that it couldn't return couples' deposits. Catering by
Milo's took over the venue in November, and rebranded three spaces:
The Juniper is now Revery; The Venue becomes Brick & Mortar; and
The Loft turns into Post 4. Instead of Dock 580, it's now all under
the umbrella North Fourth Corridor.
* Paper Moon Arts Studio for Children, and Firefly Play Cafe
In May 2020, Paper Moon Arts Studio for Children and Firefly Play
Cafe both announced they would not be able to reopen due to loss of
business resulting from Ohio's Stay-At-Home orders. Both
businesses cited financial hardship as the reason they shut their
doors.
* AMC Lennox shuts. Phoenix Theatres takes over management
The former AMC Lennox Town Center movie theater shut its doors, but
Phoenix Theatres leapt in quickly to re-open the venue in December
2020. AMC announced the closure of the Clinton Township theater
near Ohio State's campus late November, where the 24-screen movie
theater is a longtime fixture.
* Firefly American Bistro in New Albany, and The Table in Victorian
Village
In May 2020, the owners of Firefly Bistro in New Albany announced
on Facebook they were closing for good. Kathleen Perrine, one of
the owners, says because they are debt-free, taking a risk simply
wasn't worth it. The Table in Victorian Village closed as well, and
its owners said they intended to sell to the right person. Even
though they weren't opening to the public, The Table was still
doing carryout until further notice.
* Art Van Furniture
In March 2020, Michigan-based Art Van Furniture shuttered all its
locations across the country, a move that impacted about 5,500
employees across five states.
"Despite our best efforts to remain open, the company's brands and
operating performance have been hit hard by a challenging retail
environment," company spokeswoman Diane Charles said in a
statement.
The retailer's sole Central Ohio location had opened a year before
1551 Gemini Place with a high-profile opening celebration attended
by Cindy Crawford and Nigel Barker.
* Traxler Printing
In September 2020, Founder and CEO of Traxler Printing Zachary
Traxler knew he couldn't sustain the business any longer.
"I've spent a third of my life building this company, creating jobs
for this company and for this community and having it all go away
based on a pandemic was really difficult," Traxler said.
* Pier 1 Imports
In February 2020, home goods retailer Pier 1 Imports Inc. filed for
bankruptcy protection. The company, founded in 1962, had been
struggling with increased competition from online retailers.
* Guitar Center, Macy's, GNC, Sur La Table, Ruby Tuesday, Stein
Mart, Lord & Taylor, Sizzler, California Pizza Kitchen
Although these chains may still have business open in Columbus,
they've all been hard-hit by the pandemic, and the way it's changed
shopping and dining habits.
A few of Traxler's employees created a small printing company
called InkLine.
[*] More Than 50 Restaurant & Retail Bankruptcies in 2020
---------------------------------------------------------
Legal Readers reports that popular retailers and restaurants are
filing bankruptcy due to the pandemic.
Data shows there were more than fifty restaurant and retail
bankruptcies in 2020 due to the pandemic. Some of the chains that
filed have been well-known for years to the communities in which
they serve. One of the most recent eateries to file, Punch Bowl
Social, declared Chapter 11 bankruptcy in late December 2020.
Prior to the pandemic, the restaurant's twenty locations served as
a "eatertainment" hot spot, combining social venues with a much
sought-after menu. Established in 2012, Punch Bowl Social had
secured a $140 million investment from Cracker Barrel. But as the
shutdowns began in the states where the chain was most popular,
such as California, Texas, and areas of the Midwest, CEO Robert
Thompson left, and signs of problems emerged.
"In a now too-familiar tale, the debtors' businesses were
immediately and significantly adversely affected by COVID-19,"
Punch Bowl said in its bankruptcy court filing. "Unfortunately,
because of restrictions limiting the number of patrons at each
venue, as well as the public's uneasiness of going out to eat or
drink in public during a pandemic, each of those venues was losing
money on a daily basis."
Other significant shakeups to the restaurant world took place as
the coronavirus spread. Parent company for Brio Italian
Mediterranean and Bravo Fresh Italian, FoodFirst Global
Restaurants, was forced to file for Chapter 11 mid-April 2020.
Pre-pandemic, the company had already shuttered ten locations and
that number skyrocketed to 71 of its 92 restaurants after the
outbreak.
Logan's Roadhouse is another chain impacted by COVID-19 closures.
The restaurant, based in Nashville, Tennessee was operating 230
locations in 23 states. In 2018, Craftworks Holdings acquired the
already struggling name. Then, in March 2020, it filed Chapter 11.
The following month, Craftworks announced all Logan's locations
would remain closed for the foreseeable future.
NPC International Inc., the parent company of Pizza Hut and
Wendy's, also filed for Chapter 11 bankruptcy in July 2020. It
looks like both infamous chains are surviving, however, and will
hopefully make a comeback. IHOP's CFRA Holdings declared
bankruptcy in mid-May, closing 49 restaurants in North Carolina,
South Carolina, Tennessee, and Virginia.
Chuck E. Cheese's parent company, CEC Entertainment Inc., filed for
Chapter 11 in June 2020. The company tried to stay afloat by
operating under an alias Pasqually's Pizza and Wings on delivery
apps like GrubHub, DoorDash and UberEats. However, the revenue
earned apparently was not enough to make ends meet. When the
strategy didn't work, CEC wasn't sure what direction it could take
the franchise. An ever-popular place for children's parties, the
Chuck E.'s announced it may close indefinitely.
Lim Hyatt, CEO of California Pizza Kitchen, announced at the end of
July 2020 that the eatery would file in Texas with the future of
other CPK locations nationwide still up in the air. Additional
brands making Chapter 11 moves due to shutdowns include Men's
Wearhouse, which plans to close 500 stores "over time," Ann Taylor,
Lane Bryant, New York & Company, Brooks Brothers, Lucky Brand,
Neiman Marcus, J. Crew, True Religion, Pier 1 Imports, J.C. Penney,
and many others.
[*] Navigating Chapter 11 Reorganizations During COVID-19
---------------------------------------------------------
Javier Sosa of Proskauer wrote on JDSupra an article titled
"Navigating Chapter 11 Reorganizations during COVID-19: New
Complications or Business as Usual?"
In the best of times, a chapter 11 reorganization is an uncertain
and stressful process for all involved. When the disruptive
effects of COVID-19 are added to the mix, and many businesses face
significant economic difficulties, one can begin to appreciate the
daunting task facing bankruptcy courts, debtors, creditors, and
their lawyers.
The pandemic has challenged many industries, but has had a
particularly destructive effect on those relying on foot traffic,
such as retailers and restaurants. For many, declaring bankruptcy
is the only life line left, and, given the ongoing economic
uncertainties, a successful chapter 11 reorganization has become
all the more important. This continues to occur on the national
level, with Ruby Tuesday becoming one of the latest major
restaurant chains to file for chapter 11 protection in order to
address the financial impact of COVID-19. Restaurants facing
chapter 11 can perhaps look to the recent successful confirmation
of American Blue Ribbon Holdings' ("ABRH") chapter 11
reorganization plan for a glimpse of how COVID-19 may have changed
the process.
In Re American Blue Ribbon Holdings, LLC
ABRH is the parent company of several popular restaurant chains,
including Village Inn and Bakers Square. On January 27, 2020, it
filed for chapter 11 bankruptcy, shortly before the outbreak of
COVID-19 in the United States. Eight months later, on September
16, 2020, the U.S. Bankruptcy Court for the District of Delaware
issued its order confirming the chapter 11 reorganization plan.
How did COVID-19 change the arguments and decisions made during
this process, if at all?
To confirm a chapter 11 reorganization plan, a court must generally
consider whether a plan is:
* Feasible;
* Proposed in good faith;
* In the best interests of creditors; and
* Fair and equitable.
Each of these principal considerations can present a difficult
hurdle for a plan proponent to overcome under court and creditor
scrutiny. In this case, the confirmation of the plan hinged on the
feasibility of their proposed plan. As defined in the Bankruptcy
Code, feasibility simply means that confirmation of the plan "is
not likely to be followed by the liquidation, or the need for
further financial reorganization, of the debtor" unless proposed in
the plan. See 11 U.S.C. § 1129(a)(11).
Verlander Enterprises, a creditor and Village Inn franchisee,
questioned the feasibility of the plan in its objections. As a
franchisee, Verlander was contractually obligated to purchase pies
from ABRH's designated supplier, Legendary Pies. Verlander alleged
COVID-19 had caused Legendary Pies to shut down one of its plants
and make other operational changes that were negatively impacting
their products and ultimately Verlander's sales.
As originally constituted, the plan provided that ABRH would assume
eleven of the existing franchise agreements with Verlander, which
meant that Verlander would have had to continue its duties as a
Village Inn franchisee. Verlander objected to this portion of the
plan by arguing that, given the debtors' financial state and damage
to its brand, the operational changes at Legendary Pies, and the
continuing uncertainty surrounding operating a successful
restaurant business during a pandemic, ABRH "ha[d] not—and
cannot—provide adequate assurance of future performance."
Because of these factors, Verlander argued, ABRH's plan was likely
to be followed by liquidation or the need for further financial
reorganization and so was not "feasible" under the standards of 11
U.S.C. Sec. 1129(a)(11). Predictably, ABRH forcefully objected to
Verlander's claims, arguing they were merely attempts to use the
bankruptcy process to amend the franchise agreements in its favor,
and the plan would not result in further liquidation or
reorganization. How this argument would have been evaluated by the
court remains unknown, however, because on the final day of the
confirmation hearings, counsel for ABRH notified the court that a
settlement had been reached that would allow Verlander to move on
from being a Village Inn franchisee, thus clearing the way for one
of the few major restaurant reorganizations during the COVID-19
era.
Takeaways
As more and more companies turn to chapter 11 for relief, the
economic recovery will partially turn on whether businesses can
effectively use a reorganization plan as an opportunity for the
future. During the bankruptcy process itself, however, companies
and their counsel should consider the ways the ever-present
pandemic can affect traditional arguments. While ABRH was able to
confirm its plan without encountering novel difficulties, its
experience shows the ways COVID-19 can have a disruptive ripple
effect on all the parties involved, from franchisees to
manufacturers and suppliers, which may further complicate a
successful chapter 11 reorganization.
[^] BOND PRICING: For the Week from January 4 to 8, 2021
--------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
AMC Entertainment Holdings AMC 5.750 17.228 6/15/2025
AMC Entertainment Holdings AMC 6.125 14.582 5/15/2027
AMC Entertainment Holdings AMC 5.875 13.773 11/15/2026
Acorda Therapeutics ACOR 1.750 55.000 6/15/2021
American Airlines 2013-1
Class B Pass
Through Trust AAL 5.625 99.232 1/15/2021
BPZ Resources BPZR 6.500 3.017 3/1/2049
Basic Energy Services BASX 10.750 16.876 10/15/2023
Basic Energy Services BASX 10.750 16.876 10/15/2023
Briggs & Stratton Corp BGG 6.875 8.625 12/15/2020
Bristow Group /old BRS 6.250 6.250 10/15/2022
Bristow Group /old BRS 4.500 6.250 6/1/2023
Buffalo Thunder
Development Authority BUFLO 11.000 50.125 12/9/2022
Burlington Northern &
Santa Fe Railway Co
2002-2 Pass
Through Trust BNSF 5.140 99.664 1/15/2021
CBL & Associates LP CBL 5.250 38.125 12/1/2023
Chesapeake Energy Corp CHK 11.500 17.000 1/1/2025
Chesapeake Energy Corp CHK 8.000 5.375 6/15/2027
Chesapeake Energy Corp CHK 5.500 5.625 9/15/2026
Chesapeake Energy Corp CHK 8.000 4.250 1/15/2025
Chesapeake Energy Corp CHK 6.625 6.188 8/15/2020
Chesapeake Energy Corp CHK 7.000 5.750 10/1/2024
Chesapeake Energy Corp CHK 5.750 4.250 3/15/2023
Chesapeake Energy Corp CHK 4.875 4.250 4/15/2022
Chesapeake Energy Corp CHK 11.500 16.000 1/1/2025
Chesapeake Energy Corp CHK 6.875 4.678 11/15/2020
Chesapeake Energy Corp CHK 7.500 6.063 10/1/2026
Chesapeake Energy Corp CHK 8.000 5.750 3/15/2026
Chesapeake Energy Corp CHK 8.000 5.313 6/15/2027
Chesapeake Energy Corp CHK 8.000 5.139 1/15/2025
Chesapeake Energy Corp CHK 8.000 5.210 3/15/2026
Chesapeake Energy Corp CHK 6.875 5.149 11/15/2020
Chesapeake Energy Corp CHK 8.000 5.210 3/15/2026
Chesapeake Energy Corp CHK 8.000 5.313 6/15/2027
Chesapeake Energy Corp CHK 8.000 5.139 1/15/2025
Chinos Holdings CNOHLD 7.000 0.332 N/A
Chinos Holdings CNOHLD 7.000 0.332 N/A
Colony Capital CLNY 3.875 99.760 1/15/2021
Dean Foods Co DF 6.500 0.625 3/15/2023
Dean Foods Co DF 6.500 0.750 3/15/2023
Diamond Offshore Drilling DOFSQ 5.700 12.875 10/15/2039
Diamond Offshore Drilling DOFSQ 7.875 14.500 8/15/2025
Diamond Offshore Drilling DOFSQ 3.450 16.000 11/1/2023
ENSCO International VAL 7.200 5.750 11/15/2027
Energy Conversion Devices ENER 3.000 7.875 6/15/2013
Energy Future Competitive
Holdings Co LLC TXU 1.024 0.072 1/30/2037
Exela Intermediate LLC /
Exela Finance EXLINT 10.000 30.695 7/15/2023
Exela Intermediate LLC /
Exela Finance EXLINT 10.000 30.731 7/15/2023
Extraction Oil & Gas XOG 7.375 18.500 5/15/2024
Extraction Oil & Gas XOG 5.625 18.500 2/1/2026
Extraction Oil & Gas XOG 7.375 18.301 5/15/2024
Extraction Oil & Gas XOG 5.625 18.479 2/1/2026
Federal Home Loan
Mortgage Corp FHLMC 1.850 99.710 1/13/2025
Federal Home Loan
Mortgage Corp FHLMC 1.670 99.818 1/13/2023
Federal Home Loan
Mortgage Corp FHLMC 1.810 99.709 1/13/2025
Federal Home Loan
Mortgage Corp FHLMC 1.820 99.665 1/13/2025
Federal Home Loan
Mortgage Corp FHLMC 1.650 99.807 1/13/2023
Fleetwood Enterprises FLTW 14.000 3.557 12/15/2011
Frontier Communications FTR 10.500 55.000 9/15/2022
Frontier Communications FTR 7.125 52.563 1/15/2023
Frontier Communications FTR 8.750 49.000 4/15/2022
Frontier Communications FTR 6.250 50.125 9/15/2021
Frontier Communications FTR 9.250 44.500 7/1/2021
Frontier Communications FTR 10.500 55.163 9/15/2022
Frontier Communications FTR 10.500 55.163 9/15/2022
GNC Holdings GNC 1.500 1.250 8/15/2020
GTT Communications GTT 7.875 39.482 12/31/2024
GTT Communications GTT 7.875 39.263 12/31/2024
General Electric Co GE 5.000 92.250 N/A
Goodman Networks GOODNT 8.000 10.000 5/11/2022
Great Western Petroleum
LLC / Great Western
Finance Corp GRTWST 9.000 57.000 9/30/2021
Great Western Petroleum
LLC / Great Western
Finance Corp GRTWST 9.000 57.950 9/30/2021
Hertz Corp/The HTZ 6.250 51.002 10/15/2022
Hi-Crush HCR 9.500 0.063 8/1/2026
Hi-Crush HCR 9.500 0.051 8/1/2026
High Ridge Brands Co HIRIDG 8.875 1.500 3/15/2025
High Ridge Brands Co HIRIDG 8.875 1.243 3/15/2025
HighPoint Operating Corp HPR 7.000 39.510 10/15/2022
Hornbeck Offshore Services HOSS 5.875 1.071 4/1/2020
J Crew Brand LLC /
J Crew Brand Corp JCREWB 13.000 52.131 9/15/2021
JC Penney Corp JCP 5.875 7.750 7/1/2023
JC Penney Corp JCP 5.875 7.750 7/1/2023
JCK Legacy Co MNIQQ 6.875 0.462 3/15/2029
JCK Legacy Co MNIQQ 7.150 0.299 11/1/2027
K Hovnanian Enterprises HOV 5.000 11.958 2/1/2040
K Hovnanian Enterprises HOV 5.000 11.958 2/1/2040
LSC Communications LKSD 8.750 10.819 10/15/2023
LSC Communications LKSD 8.750 12.875 10/15/2023
Liberty Media Corp LMCA 2.250 47.625 9/30/2046
MAI Holdings MAIHLD 9.500 15.747 6/1/2023
MAI Holdings MAIHLD 9.500 15.747 6/1/2023
MAI Holdings MAIHLD 9.500 15.747 6/1/2023
MF Global Holdings Ltd MF 6.750 15.625 8/8/2016
MF Global Holdings Ltd MF 9.000 15.625 6/20/2038
Mashantucket Western
Pequot Tribe MASHTU 7.350 15.000 7/1/2026
Men's Wearhouse LLC/The TLRD 7.000 1.750 7/1/2022
Men's Wearhouse LLC/The TLRD 7.000 1.309 7/1/2022
NWH Escrow Corp HARDWD 7.500 32.500 8/1/2021
NWH Escrow Corp HARDWD 7.500 30.277 8/1/2021
Navajo Transitional Energy LLC
NVJOTE 9.000 62.500 10/24/2024
Neiman Marcus Group LLC/The NMG 7.125 4.345 6/1/2028
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.000 4.239 10/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 14.000 27.250 4/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.750 5.110 10/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.000 4.239 10/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 14.000 27.250 4/25/2024
Neiman Marcus Group LTD
LLC / Neiman Marcus
Group LLC / Mariposa
Borrower / NMG NMG 8.750 5.110 10/25/2024
Nine Energy Service NINE 8.750 43.996 11/1/2023
Nine Energy Service NINE 8.750 44.062 11/1/2023
Nine Energy Service NINE 8.750 43.765 11/1/2023
Northwest Hardwoods HARDWD 7.500 30.750 8/1/2021
Northwest Hardwoods HARDWD 7.500 30.075 8/1/2021
OMX Timber Finance
Investments II LLC OMX 5.540 1.250 1/29/2020
Peabody Energy Corp BTU 6.000 69.333 3/31/2022
Peabody Energy Corp BTU 6.000 69.072 3/31/2022
Pride International LLC VAL 6.875 7.250 8/15/2020
Pride International LLC VAL 7.875 8.188 8/15/2040
Renco Metals RENCO 11.500 24.875 7/1/2003
Revlon Consumer Products REV 6.250 34.194 8/1/2024
Rolta LLC RLTAIN 10.750 2.344 5/16/2018
SESI LLC SPN 7.125 32.250 12/15/2021
SESI LLC SPN 7.750 32.000 9/15/2024
SESI LLC SPN 7.125 31.905 12/15/2021
SESI LLC SPN 7.125 29.750 12/15/2021
Sable Permian Resources
Land LLC / AEPB
Finance Corp AMEPER 7.125 0.771 11/1/2020
Sears Holdings Corp SHLD 8.000 2.004 12/15/2019
Sears Holdings Corp SHLD 6.625 4.337 10/15/2018
Sears Holdings Corp SHLD 6.625 4.333 10/15/2018
Sears Roebuck Acceptance SHLD 7.000 0.603 6/1/2032
Sears Roebuck Acceptance SHLD 6.500 0.453 12/1/2028
Sempra Texas Holdings Corp TXU 5.550 13.500 11/15/2014
Senseonics Holdings SENS 5.250 42.500 2/1/2023
Summit Midstream Partners SMLP 9.500 25.000 N/A
TerraVia Holdings TVIA 5.000 4.644 10/1/2019
Toys R Us TOY 7.375 1.317 10/15/2018
Transworld Systems TSIACQ 9.500 27.000 8/15/2021
Voyager Aviation Holdings
LLC / Voyager Finance Co VAHLLC 9.000 54.774 8/15/2021
Voyager Aviation Holdings
LLC / Voyager Finance Co VAHLLC 9.000 55.404 8/15/2021
*********
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
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*********
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